gas plant

Parent firm of COP26 sponsor opened big gas plants in Mexico

The parent company of one of the ‘green’ sponsors of the COP26 climate summit in Glasgow has opened four new gas-fired power plants in Mexico since 2019.

Spanish-based utilities giant Iberdrola signed 25-year contracts to construct, operate and maintain the new plants, which have a combined capacity of nearly 3.5 gigawatts, in 2018. Construction of the plants was completed between 2019 and 2020, and all four are now operational.

In November 2020 Iberdrola’s British subsidiary, ScottishPower, was selected by the UK Government as one of the principal corporate partners of the global climate summit (COP26), which is due to be held in Glasgow in November 2021.

The UN’s annual Conference of the Parties (COP) events bring together political leaders and delegates from across the world to discuss solutions to the climate crisis. At previous COPs, principal partners have been granted privileged access to delegates and policymakers, as well as a platform to promote their businesses as climate-friendly.

Critics said the Mexican plants meant that Iberdrola would continue to produce carbon emissions for the duration of the 25-year contracts, adding that polluters should be “kicked out” of the climate crisis talks in Glasgow.

However ScottishPower stressed that its “credentials as a green energy company are clear for all to see”.

A spokesperson noted that ScottishPower was the first energy company in the UK to produce 100 per cent clean energy when it stopped all British fossil fuel generation in 2018.

Iberdrola’s huge investment in these gas-powered electricity stations mean carbon emissions will be pouring out for the lifetime of the 25-year contracts.

Professor James Curran

But the former chief executive of the Scottish Environmental Protection Agency (SEPA), Professor James Curran, told The Ferret that Iberdrola’s growing natural gas portfolio in Mexico “fits uneasily” with its company policy to move past fossil fuel energy production.

“Iberdrola’s huge investment in these gas-powered electricity stations mean carbon emissions will be pouring out for the lifetime of the 25-year contracts – that’s up to 2045 – by which time Scotland will already be net-zero,” Curran added.

The US President Joe Biden is expected to attend COP26, which is being hosted by the UK Government in Glasgow. Climate experts have described the event as the last chance to finalise the 2015 Paris Agreement, which aims to keep global temperature rises well below 2°C.

COP26 was postponed from 2020 to 2021 due to the Covid-19 pandemic, and it is unclear whether the format of this year’s event might also be affected by the ongoing risk posed by the virus.

ScottishPower made the news in 2018 after it sold all of its fossil fuel assets in the UK to Drax, in a deal worth £702m. This made it the first major UK energy company whose British portfolio was 100 per cent renewable.

Observers at the time suggested that it was exposure to unstable merchant energy markets, rather than concern about carbon emissions, that motivated the switch to renewable energy in the UK, however.

In total, ScottishPower owns three gigawatts of installed renewable capacity in the UK. This figure is less than is produced by the four new Mexican plants alone, and is dwarfed by the seven gigawatts of natural gas energy produced by Iberdrola in Mexico as a whole.

In June 2020, Iberdrola had to shelve plans to invest a further $1.2bn (£877m) in a gas-fired plant in the Mexican city of Tuxpan because they couldn’t secure a supply of natural gas.

The UK Government required all of its sponsors to be signed up to the Science Based Targets initiative, which helps companies to bring their carbon emissions in line with Paris Agreement limits.

Iberdrola is signed up to the initiative and has announced plans to become carbon neutral in Europe by 2030, and reduce its global emissions by 86 per cent over the same period. It has also promised to invest over €34bn (£30bn) to double its global renewable capacity by 2025.

COP26 ‘greenwashing’

Head of campaigns at Friends of the Earth Scotland, Mary Church, described ScottishPower as a “convenient COP26 sponsor for the UK Government” given its focus on renewables.

But, she added: “Behind its climate-friendly facade is its parent company Iberdrola’s growing fossil fuel portfolio.

“Big polluters and those who would promote their greenwash must not be allowed to influence these vital talks. Just like the World Health Organisation banned big tobacco from its spaces, climate polluters – like Iberdrola – must be kicked out of the climate talks.”

The value of the sponsorship deals with principal partners are yet to be revealed, with the UK Government saying this information will be released after the Glasgow summit.

At COP25 in Madrid, ‘diamond tier’ sponsorship, the equivalent of principal partnership, reportedly cost sponsors €2m (£1m).

‘Diamond tier’ sponsorship bought access to the event’s civil society ‘green zone’ where sponsors held exhibitions, had direct access to ministers and delegates from across the world, and made big announcements to the press. Iberdrola was also a ‘diamond tier’ sponsor of COP25.

The Scottish Greens’ energy spokesperson, Mark Ruskell, noted that the previous COP was criticised for “the amount of powerful lobbyists who were allowed in as sponsors”.

“It will be up to the Green movement around the world to ensure that the voices of those most threatened by the climate emergency are the ones heard most loudly, not the sponsors,” he added.

The selection of two other principal partners, NatWest and SSE, have also provoked a backlash from climate campaigners.

According to a report by the Rainforest Action Network, NatWest has invested £9.15bn in fossil fuel companies and projects since 2016.

SSE operates Scotland’s most polluting power station at Peterhead, and is building the UK’s only new gas-fired facility at Keadby in North Lincolnshire.

Responding to criticism of the choice of sponsors, a COP26 spokesperson said: “All Principal Partners have shown commitment to taking positive climate action and met a high bar to be selected as sponsors, including making science-based carbon emissions reductions plans to achieve Net Zero by 2050 or earlier”.

Photo thanks to iStock/af_istocker.

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