22/01/2026 in Developments, News

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Data centre operator Echelon Data Centres and power utility Iberdrola have formally completed a strategic alliance to build and operate large-scale data centres in Europe, starting in Spain. Echelon Iberdrola Digital Infra has initial planned investments of more than €2bn, making it the largest European joint venture between a data centre developer and energy company.

Initially announced in July 2025, the joint venture received regulatory approval from the European Commission last month.

Echelon Iberdrola Digital Infra will develop capacity for hyperscale and AI technology companies. The company’s first development project will be Madrid Sur, a 160,000 sqm data centre campus. The site has already secured a 230MW grid connection. Power will be provided by an on-site solar PV facility alongside additional clean energy capacity from Iberdrola, ensuring the data centre’s electricity needs are fully met by renewable sources. This project will generate about 1,500 direct and indirect jobs.

Under the partnership, Echelon will be responsible for planning, design, commercialisation, and day-to-day operations of the campus, while Iberdrola will secure strategically located sites with robust grid access and ensure a continuous 24/7 supply of clean energy. Echelon will own 80% of the JV, with Iberdrola owning the remaining 20% through its dedicated digital infrastructure subsidiary, CPD4Green.

Echelon Iberdrola Digital Infra introduces a new model for scale data centre development that directly addresses the three biggest constraints in the sector: land, grid power availability and speed of delivery. By combining utility-led site and power development with operator-led design and delivery, Echelon Iberdrola Digital Infra mitigates risk, providing the certainty that investors require to make quicker and more confident decisions.

Already, more than 700 MW in electricity connections have been secured by Iberdrola in strategic areas near Madrid for potential new projects that result in an additional €6bn of investment.

David Smith, Deputy CEO, at Echelon Data Centres, said: “Entering the Spanish data centre market has been a strategic goal for Echelon due to the clear benefits for our customers: access to large-scale renewable energy and exceptional construction and operational capacity.

“Partnering with Iberdrola to create Echelon Iberdrola Digital Infra allows us to create a new model for the development of scale data centre infrastructure across Europe – one that brings certainty in key areas that affect data centre decision-making and ensures the timely delivery of world-class data processing infrastructure.”

David Mesonero Molina, Corporate Development Director of Iberdrola, said: “Our joint venture reinforces Iberdrola’s strategy of facilitating the development of data centres, which are a key vector for growth in electricity demand. Echelon’s participation allow us to add significant value to our portfolio of sites.

“They have access to power connection and safe, clean and competitive energy 24 hours a day, 365 days a year, and the scale data infrastructure planned for the sites will be delivered by experts and innovators in the field.”