Data Centres As Grid Infrastructure – Iberdrola Announces New Data Centre Joint Venture

Iberdrola has announced a €2 billion joint venture with Echelon Data Centres to build a new generation of large, renewable-powered data centres across Spain – a notable move for an organization traditionally rooted in energy, not digital infrastructure. The first site, a 144MW hyperscale campus south of Madrid, will run fully on clean power. The news signals Iberdrola’s intention to play directly in the data centre market, rather than simply supply electricity from the sidelines.

Data centres have become a significant enough element of the electricity system that utilities now want to be directly involved in their rollout. Hyperscalers are no longer just large customers, they are among the most dominant sources of new demand on the grid – the average size of a US data centre will be around 60MW by 2028. Iberdrola’s decision to co-develop data centres reflects an intention to bring that demand inside the planning tent, rather than reacting to it after the fact.

From a utility perspective, this makes a great deal of sense. Grid operators have a detailed understanding of where capacity exists, where reinforcement is already planned and where renewable generation can be integrated most efficiently. When utilities are involved early in data centre development, location decisions can be made with the network in mind – reducing bottlenecks, avoiding costly upgrades, and aligning compute growth with the physical realities of the grid. Iberdrola’s venture suggests a shift toward grid-led siting of data centres, marking a change in how digital infrastructure is rolled out. Historically, data centre locations have been dictated by fibre routes, real estate availability and tax incentives, with power treated as something to be secured later. Iberdrola’s investment is a reversal of that logic: electricity availability, grid topology and renewable integration move to the top of the agenda. That alone is a meaningful evolution, and one we are likely to see repeated as AI-driven demand accelerates.

There is also a longer-term implication: once utilities are co-developers rather than distant suppliers, the relationship between grids and data centres can evolve further. Over time, hyperscale facilities could move from being treated as fixed, inflexible loads to becoming more integrated system assets – capable of demand flexibility, load shifting and deeper coordination with renewable generation. That future is not the headline of Iberdrola’s announcement, but the structure of the partnership could be a foot in the door.

Seen in this light, Iberdrola’s data centre investment is less about diversification and more about control and coordination. It reflects a recognition that data centres now sit at the centre of electricity demand growth, and that utilities which help shape where and how they are built will be better positioned to manage the grid, integrate renewables and remain relevant in an AI-driven energy system.