Spanish renewable energy giant Iberdrola said on Monday it would invest nearly 14 billion euros ($15 billion) in Britain through 2028 in grids and renewable projects.
The plan is in line with the company's broader investment strategy, which has seen a growing focus on networks, whose returns tend to be predictable, and a more selective approach to renewable projects, favouring those yielding higher returns.
It adds some 8 billion euros to the investment Iberdrola had already pledged in Britain for the period between 2023 and 2025.
Some of Europe's energy giants have turned more cautious on renewables, as the sector faces high interest rates and rising debt costs.
Additional investment in grids are necessary to strengthen the system given the increased role played by intermittent electricity production from renewables.
Italian energy group Enel has adopted a similar script, with a new investment plan that will focus on power grids while being more cautious on renewable energy projects.
Iberdrola said transport and distribution networks would get roughly two-thirds of the planned investment, including more than 3 billion euros for a subsea cable able to transport enough renewable energy to power two million households.
The construction of the cable, Eastern Green Link 1, will start early next year.
The Spanish firm also pledged to invest in solar and wind projects, including the offshore wind project off Britain's eastern coast known as East Anglia 3, as well as in green hydrogen.
The overall investment - which came alongside several others announced by the UK government - may rise with further opportunities in offshore wind, Iberdrola said.
"With stable and predictable regulatory frameworks in the United Kingdom, we are more committed than ever to continue promoting our investments in networks and renewables to continue promoting the energy transition and the achievement of the country's climate objectives," Executive Chairman Ignacio Sanchez Galan said in a statement.
($1 = 0.9168 euros)
(Reuters - Reporting by Pietro Lombardi; Editing by David Latona and Mark Potter)