Spanish renewables giant Iberdrola has secured an agreement that gives it an option to enter five offshore wind projects in the Philippines at very early stages of development.

The deal, involving up to 3.5 gigawatts (GW) of capacity, was signed with Stream Invest Holding, a Swiss renewable energy group, and Triconti ECC Renewables, the Philippines’ largest independent wind developer.

All projects have secured a wind energy service contract from the Philippines’ Department of Energy and would be jointly developed by the companies.

The alliance opens the opportunity for Iberdrola to enter the country’s offshore wind market, which the firm believes offers strong growth potential over the coming decades. The Philippines has a BBB+ credit rating from S&P Global, an expected GDP growth above 6% and electricity demand set to expand at approximately 6% annually between now and 2040.

The deal could also see the Spanish firm supporting the country in efforts to develop its clean energy market and meet its decarbonization targets, while becoming a major long-term renewable energy investor in the country. The country’s National Renewable Energy Programme (NREP) for 2020-2040 has set a target of 35% share of renewable energy in the power generation mix by 2030 and 50% by 2040.

The development of the five offshore wind projects is expected to contribute to local economic development, job creation and skills development.

Iberdrola has several other renewable energy deals in Asia, including offshore wind projects in Taiwan and Japan and onshore wind farms and a 50-MW floating photovoltaic project in Vietnam.