[Non-English content] . Good morning, ladies and gentlemen. First of all, we would like to offer a warm welcome to all of you who have joined us today for our 2021 fiscal year results presentation. Secondly, we wish you a healthy 2022 for all of you and your families. Now, onto the reason why we are all here, our 12-month results presentation, which will follow the normal format. Firstly, we will begin with an overview of the results and the main developments during the period given by the senior executive team that we usually have with us, our Chairman and CEO, Mr. Ignacio S. Galán, Mr. Armando Martínez, Business CEO, and finally, Mr. José Sáinz Armada, CFO. Following this, we will move on to the Q&A session. I would also like to highlight that we are only going to take questions submitted via the web.
Please ask your question only through our webpage, www.iberdrola.com. Additionally, I would now like to ask you to focus your question on the 2021 results because our big financial magnitudes for the next years will be released on March 22 at our Capital Markets Day to be held in London. Finally, we expect that today's event will not last more than 70 minutes. Hoping that this presentation will be useful and informative for all of you, now, without further ado, I would like to give the floor to our Chairman and CEO, Mr. Ignacio Galán. Thank you very much again. Please, Mr. Galán.
Good morning, everyone, and thank you very much for joining today's conference call. In 2021, net profit reached EUR 3,885 million, up 8%, beating once again our expectation. Reported EBITDA grew 20% to EUR 13 billion, thanks to the strong operating performance in the United States and Brazil, along with growth in renewables in all countries. More than offsetting the negative impact of higher spot prices, which were far above the prices fixed at which we had previously sold the energy to our customers. This affected our retail activities in Spain and U.K. in Iberdrola and in energy international. Investment reached a new record of EUR 9,840 million, more than previous year, 3% more.
We store 3,500 MW of renewable capacity, and we have 7,800 in construction that we will provide additional growth in the near future. Of this capacity under construction, 2,600 correspond to offshore wind power in U.S., France, and Germany. As we will see later, over the year, we have accelerated offshore wind expansion worldwide with new project like Commonwealth Wind in Massachusetts, ScotWind in U.K. or Windanker in Germany, giving more visibility to our growth in the next decade. In Networks, we have also accelerated investment in all geographies, adding EUR 2 billion to our regulated assets base, which has reached EUR 33 billion already. We have combined this expansion investment with a strong financial position. This, along with our resilient business profile, put us in a balanced position to navigate the current macro and commodity scenario.
80% of group debt has fixed rates. About half of our operating margin is automatically protected from inflation as a result of regulatory frameworks and contracts with indexed prices. For the remainder, we expect market prices to reflect increasing costs. In addition, our major supply contracts for 2022 are already closed with fixed or hedged prices, protecting ourselves from any potential duration or price shock in the global supply chains. This set of results has allowed the Board of Directors to propose the Annual General Shareholders' Meeting total shareholder remuneration of EUR 0.44 per share with an increase of close to 5%, in line with our guidance and beyond the targets included in our long-term plan. EBITDA reported is up 20% to EUR 12 billion, even after a negative FX impact of EUR 169 million.
In Networks, operating profit grew in all our countries, driven by the expansion of our regulated assets base, both in transmission and distribution. A new tariff in all countries, mainly in United States, where our growth rate reflect the full year impact of the new New York rate case approved in November 2020. Finally, EBITDA increase in Brazil, led by the tariff adjustment and reviews, the contribution of new transmission investment and the integration of the Neoenergia Distribuição Brasília. As our CFO, José Sainz, will explain in this result, we are reporting all energy production and customer activities combined to better reflect the dynamics of these businesses, as most of the renewable production is sold to our own customers at fixed prices.
The increase in EBITDA of this business was driven by additional offshore production up by 26%, mainly due to Rampion offshore wind farm fully operational in U.K. Higher onshore output led by increased load factors and capacity addition over the last three months, despite low wind factors in U.K. and the United States. Results reflect the positive impact of reversal by the courts of levies and access charges in Spain in previous year. These factors were partly offset by the impact of wholesale and retail market dynamics driven by high gas prices, as Iberdrola maintained the fixed prices previously agreed with our customers in a context of increasing energy costs. In fact, if we had not maintained our commitment to customers and we had sold our production in the spot market, result would have been higher by EUR 1 billion. Net profit we have already had in our accounts.
In the U.K., we also suffered the impact of a price cap that is in reality become a price floor in the market, as this did not reflect costs. This has driven more than 30 retailers to go bankrupt in the country, as probably you know. We expect an increase in the cap defined by the regulator will help to normalize the situation, although it is still insufficient. Investment in 2021 reached a new investment record with EUR 9,040 million, 3% up versus 2020. Close to 90% of this amount was invested in networks and renewables, almost equally split. Brazil's investment increased heavily in Brazil, both in networks with integration in Neoenergia Distribuição Brasília, a further expansion in our transmission distribution assets, and renewables, where investment multiplied by three due to the acceleration of the onshore wind project.
In renewables, globally, we have added 3,400 new renewable megawatts in the last 12 months, increasing our total renewable capacity by 9% to more than 38,000 MW. This capacity addition include 1,150 MW of new onshore wind farms in all our geographies, mainly Brazil, the U.S., Australia, Poland, and Greece. Almost 1,200 solar PV, more than in Spain, with projects across the whole country. In fact, the renewable power installed in Iberdrola in Spain is, in 2021, more than double next competitors. We have 1,000 new megawatts in Portugal at the Tâmega after completing the construction of two of these three facilities, Gouvães and Daivões.
Finally, we put in 170 MW of battery storage in Australia, Spain, and U.K., including standalone batteries and hybrid facilities to provide backup for wind and solar PV. On top of that, we have close 7,800 under construction. 1/3 of this capacity is in Spain in solar PV and onshore wind project. Almost another 33% correspond to United States, mainly in offshore wind, but also in onshore wind and solar PV. The remaining 1/3 is spread among offshore wind in Germany and France, and onshore wind and solar in Brazil, Australia, Portugal, Greece, Poland, U.K., etc., etc.
ScottishPower recently in the U.K. acquired a portfolio of 17 solar projects with a combined capacity of 100 MW in an advanced stage of development, positioning the company at the forefront of the solar industry in the country. In terms of contribution to result, all these new projects, one-third of total capacity under construction correspond to offshore wind, which generate between 2x and 3 x the energy per megawatt of solar PV and multiplies its EBITDA contribution almost 4x . In fact, offshore wind has become a major growth vector for the group, taking advantage of our position as first movers. After 50 years of development, we have 1,300 in operation in Germany and the U.K., 2,600 under construction on track to be commissioned by 2025.
4,600 secured projects that will be operational between 2026 and 2027. In addition, we have growth opportunities to develop more than 26,000 from 2028 in our traditional market and other geographies with a strong potential such as Japan, Sweden, or Poland. In the last 12 months, we have taken major step in consolidating our position in offshore wind. We have started the construction of first large-scale offshore wind farm in the U.S., Vineyard Wind 1, for which we also closed the financing in a transaction recognized as the Global ESG Deal of the Year by Project Finance International.
We also reached an agreement with Copenhagen Infrastructure Partners to take full ownership of 2,000 additional MW in New England corresponding to Park City Wind, an 800 MW project with PPA already secured with Connecticut and 1,200 MW Commonwealth Wind project awarded last December. As part of the project, we will transform Salem Harbor into tier-one offshore wind logistics center. We have reached an agreement with our cable supplier to create Massachusetts' first marine cable factory in Brayton Point. At the same time, at the same site where was located New England's largest coal-fired power plant. This showed the huge potential of offshore wind to create industrial development and jobs. In Europe, we will build Windanker, our third offshore farm in the German Baltic Sea with 308 MW of capacity after Wikinger and Baltic Eagle.
Together, the three of them will have a total capacity for more than 1,100 MW. In Scotland, Iberdrola has awarded the seabed rights to develop three areas for a total capacity of 7,000, including one fixed bottom site and two floating sites in partnership with Shell. On top of that, we closed several deals to open new strategic markets in Asia and Taiwan. Moving to networks, gross investment increased by 23% to reach EUR 4,438 million. Our regulated network assets reached EUR 33 billion, up EUR 2 billion, driven by investment in distribution in all markets, and the development as well of transmission projects, mainly in Brazil and United States. This trend will continue in the coming years. A huge investment are needed to expand electrification with renewables and reach fully decarbonized energy system.
As you know, our listed subsidiaries, Avangrid and Neoenergia, released their results in these days showing a strong performance. In the United States, Avangrid net profit reached $707 million, up 22%. EBITDA increased by 7% on the period to $2,263 million. Likewise, investment increased by 20% to almost $3,300 million, mainly in networks, where the company-regulated entities rates grew $1 billion to reach $11.7 billion. Network results benefit from the full year application of the NY rate case approved in November 2020, as well as the new tariff for United Illuminating in Connecticut agreed until 2023. Avangrid continues reinforcing customer service and quality metrics, as reflected by the award received by all our utilities from Edison Electric Institute for their best-in-class response following Hurricane Ida.
The company has also made significant progress in the construction of renewable project with 330 MW installed in the year, including onshore wind and solar PV, and 2,500 under construction. As mentioned, Avangrid is pioneering the development of the offshore wind industry in the United States with 2,100 under construction or ready to build. Regarding PNM Resources, the merger agreement was extended until 2023, until mid of 2023, and a notice of appeal was filed with the Supreme Court of New Mexico against the decision of the New Mexico Public Regulation Commission. We remain fully confident that the transaction will go ahead. We have received the federal and Texas state approval in New Mexico, and the transaction in New Mexico is supported by 23 of the 24 parties involved in the proceeding.
Moving to Neoenergia, the company net profit reached BRL 3,125 million, 40% more than in 2020. EBITDA increased 52% to BRL 9,156 million, driven by organic investment, which exceeds BRL 9,300 million, up 48%, the contribution of Neoenergia Distribuição Brasília , higher renewable production, and tariff reviews and adjustment without a fully reflected higher cost. After Pernambuco and Brasília review this year, only Neoenergia's distribution companies have regulatory framework fixed at least to April 2023. In addition, Neoenergia result captured the additional revenues from transmission investment. In 2021, for instance, the company concluded the transmission installation of 730 km Jalapão line, the longest ever built by the company.
All in all, our total regulated base in Brazil has exceeded BRL 34 billion, almost BRL 8 billion more than last year. This trend will continue in the coming years, driven by new transmission projects like the 500 kW substation in the state of Minas Gerais, award in transmission auction in last December. We also expect growth to accelerate in renewables with BRL 3.5 billion invested in 2021. The Chapecó and Oitis project will be fully operational in the coming months, adding more than 1,000 MW to the company wind capacity. As you know, the rebounding economic activities that started in this calendar year is creating supply chain constraints in some raw materials as well as inflationary pressure in most economies. However, our balanced business in financial profile protects the company from potential impact in this scenario.
Fixed rate debt amounts approximately 80% of the total of our average debt maturity. Our average debt maturity is six years. Close to 70% of our revenues come from A-rated countries in currencies such as dollar, euro, pound. Around 50% of our operating margin has an explicit hedge against rise in inflation, including all our activities in Brazil and most of our renewable PPAs. We expect cost inflation to be translated to prices in our remaining business, as we already see in new power purchase agreement in the United States. At the same time, supply contracts for 2022 are closed, with prices already hedged or secured, protecting ourselves from potential supply bottlenecks or price shocks. The resiliency of our business model is reflected in our strong cash flow generation.
Operating cash flow increased 9% to EUR 8,114 million. This has also a positive impact in our solvency ratios. Our liquidity position reached EUR 9,019.5 million, covering 24 months of financial needs. We maintain our access to financial market in a very competitive terms. In 2021, Iberdrola signed almost EUR 60 billion of new green financing, commercial paper, and credit lines linked to sustainability indicators, bringing our ESG financing to almost EUR 39 billion. This transaction has consolidated Iberdrola as the largest corporate issuer of green bonds in the world. The good performance during 2020 has allowed us to reaffirm our commitment to the development of industry growth opportunities and jobs in all the regions where we operate.
Following our strategy that combines profitability with the highest environmental, social, and governance standard, this commitment was recently recognized by Standard & Poor's, who assigned Iberdrola the best ESG score of all energy companies globally, as such you can see in the next with PricewaterhouseCoopers report. In 2021, our emissions were reduced again to 60 g per kWh in Europe, almost four times lower than our competitors and peers in the continent. We have reached 388,000 renewable megawatts, and we have no coal or fuel oil plants in operation, avoiding any write-offs of additional costs associated with the decommissioning. This year we demolished the chimneys of the coal plants of Velilla, Spain, and Longannet in Scotland, showing that the move from fossil fuel to renewable energies has no way back.
Just a week ago, Iberdrola was included among the top five companies that lead the energy transition of all sectors, according to the Clean200 Global List. We are the first utility in the ranking. We are promoting decarbonization hand-in-hand with our supply chains, with purchases worth EUR 12.2 billion just in 2021 to large, medium, and small companies which employ 400,000 people. In alliance with several organizations and companies from all sectors, including financial groups like MAPFRE and Macquarie, oil companies who are now our partners in offshore wind like Shell, major players in industries investing in green hydrogen like steel or fertilizers, or in the mobility sector from Volkswagen to Volvo. One of the key areas in this alliance is innovation.
Only last year, we invested EUR 340 million in R&D, making Iberdrola the most innovative private utility in the world according to the European Commission R&D Scoreboard. With initiatives like Global Smart Grids Innovation Hub, we opened in Bilbao a few months ago. This center is bringing together more than 60 partners involving 120 projects to develop new solutions for the electricity grids of the future. An industry in transformation like ours can only be successful if we attract and retain the best talent. In 2021, we hire more than 5,500 people, of which 40% were young professionals under 30 years old. We increased the training hours per employee to 59 hours, far above the average in Europe.
We also continue promoting gender equality with women accounting now for 31% of total management position in the group, something that seems impossible in our sector a few years ago. In terms of financial reporting and disclosure, we have in place ERM and SASB reporting standard, and we have fully implemented the recommendation of the Task Force on Climate-related Financial Disclosures in 2018. Our governance and sustainability system, which is the basis of all our ESG activity, has continued to receive international recognition in 2021, like Best Corporate Governance Award in Spain and in the United States, granted by World Finance. These results have allowed Iberdrola Board of Directors to propose to our AGM a shareholder remuneration of EUR 0.44 per share, an increase of close to 5%.
For this purpose, a supplementary dividend of EUR 0.27 will be approved in the next annual general meeting to be distributed, on top of the interim remuneration of EUR 0.17 already paid this month, delivering our commitment to an increasing shareholder dividend. I will now hand over to the CFO, who will present the result in detail.
Thank you, Chairman. Good morning to all of you. Let me start with the non-recurring post-tax impacts that we have been accounting in 2021 to adjust the income statement. EUR 455 million corresponding to the U.K. deferred taxes when they have increased this tax from 19% to 25%. That will happen in 2023, so this is a non-cash item, and it is accounted in the corporate tax line. EUR 800 million after taxes due to Spanish court rulings and legal measures accounted in levies and net financial results. 166 million after taxes also corresponding to efficiency measures and non-recurring provisions with positive effects in next years that we have taken in the fourth quarter as our reported results gave us margin to do them.
The transition from the 2021 reported EBITDA that was over EUR 12 billion, up 20% versus last year, to the adjusted EBITDA in 2021 excludes EUR 95 million of these efficiency measures. The rest up to EUR 166 million net of taxes are below the EBITDA line. The 913, before taxes, million euros of the Spanish court rulings and legal measures. After all these adjustments, the EBITDA increased 11.4% to EUR 11.2 billion. Revenues increased 18% to EUR 39 billion and procurements 29.7%, reaching EUR 22 billion, also affected by high prices of commodities. Gross margin grows by 5.7% to EUR 17 billion and 7.3% excluding EUR 267 million of negative FX impact.
Net operating expenses improved 1.4% to EUR 4.2 billion. Excluding FX, net operating expenses was almost flat as higher costs driven by the new businesses, growing workforce, and efficiency plan costs were compensated by the contribution and other operating income from asset rotation, which is included in the exhibit of net external services. As the Chairman has said, as a result of the current situation, distorting very much the result of the different divisions of the energy markets and the actual operation of these markets in the electricity production and customer relationship, for this time, we have decided to report business on a two segmental basis.
Network activities, basically regulated, and energy and production customer activities as a whole in order to better reflect the evolution and dynamic of these businesses as most of our energy, as the chairman has said, is sold to our customer base. If you need more information, our IR team will give you more granularity. Analyzing the results of these two businesses and starting by networks, EBITDA grew 12.8% to EUR 5.4 billion. EBITDA grew in all geographies, thanks to our investments that increased the asset base, thanks to the improvement of our quality service, continued efficiency measures, and successful integration of new businesses. You can see in the slide, Spain contributed 30%, Brazil reached 27%, the U.S. 23%, and the U.K. contributed another 20%.
In Spain, EBITDA grew 1.1% to EUR 1.6 billion due to the positive contribution of new investments. EUR 80 million of positive settlements from previous years, more than offsetting the lower remuneration that falls from 6% in 2020 to 5.58% in 2021. In Brazil, EBITDA grew 46% to BRL 9.3 billion, driven by tariff updates and inflation-linked adjustments in distribution, lower energy losses, and increased contribution from transmission and from the integration of our distribution company in Brasília. As you know, Brazil recognizes inflation on tariffs on an annual basis, protecting the margins. In the U.S., IFRS EBITDA was 19% up to $1.5 billion due to higher investments and past cost recognitions in IFRS.
U.S. GAAP EBITDA amounted a little bit more, $1,574 million over the IFRS, $95 million over the IFRS EBITDA, mainly due to higher regulatory assets. Finally, in the U.K., EBITDA grew 1.6% to GBP 900 million, thanks to the higher asset base. Energy production and customer business EBITDA rose 24% to over EUR 6.4 billion. Key drivers of the business were as follows. Output was flat, with renewable production increasing up 8% due to a 9% higher installed capacity, reaching above 38,000 MW installed, offset by lower thermal output. It included a net positive one-off of the Spanish court rulings and legal measures.
There were higher wholesale prices that negatively affected Spain and the U.K. businesses as we maintained previously agreed contracts with our customers at lower fixed prices. In addition, we had cold snaps that impacted negatively in Spain, Mexico, and the international business, especially in the first quarter of 2021. Let me point out that on a like-for-like basis, excluding the different elements or one-offs that have affected, EBITDA was flat, as the increase in the energy cost has not benefited the group, as the chairman has pointed out. In Spain, EBITDA was EUR 2.7 billion, 25% up, excluding EUR 930 million of Spanish court rulings and legal measures, with 1.9% higher output, driven by 9.5% higher renewable production. It additionally includes EUR 230 million of asset rotation.
Higher wholesale energy purchases at higher prices versus 2020 with output already sold at lower fixed prices depressed our margins. All in all, as in for the whole business, on a like-for-like basis, EBITDA grew around 10%. In the U.S., EBITDA increased 25% to $851 million, with positive contribution from the Texas cold snap and increased installed capacity, but with lower output due to a 1.2 percentage points lower wind resource. In the U.K., EBITDA fell 34% to GBP 591 million in a context of higher energy procurements at higher prices, as in Spain, due to larger than expected demand linked to weather conditions and the obligation to take clients at the last resort tariff. The business was also affected by lower renewable production than expected.
Onshore production was 8% lower than in 2020, and offshore production was 11% up due to East Anglia in full operation since the beginning of the year. In Mexico, EBITDA fell 9% to $921 million due to a negative impact from the Texas cold snap and increase of access fees with gas costs not yet passed to tariffs. Partially, this was compensated by a 56% higher average operating capacity in renewables with 477 MW more in operation. In Brazil, EBITDA grew 60% to BRL 1.6 billion as a consequence of the extension of our hydro concession to recover costs from previous years in our hydro plants, 2.4 percentage points higher wind resource, and a better performance from our thermal Pernambuco CCGT due to the drought.
Finally, in international business, EBITDA fell 2%, with higher contribution from Australia, France, and Poland, offset by lower production from the German offshore and by our supply business impacted by cold snaps, development costs, and lower margins. Earnings before interest and taxes was up 32% to EUR 7.3 billion. D&A was 5.6% up to EUR 4.2 billion, but excluding FX grew 6.7%, mainly due to the larger asset base and activity. Provisions were down 6.6% to EUR 467 million as a consequence of lower bad debt provisions related to COVID as collections improved. Net financial expenses were flat, around EUR 1 billion, with the increase in debt related costs mostly compensated by the improvement in non-debt related costs that includes several positive one-offs.
Debt related costs increased EUR 136 million due to the higher cost of debt that increased 42 basis points to 3.6% due to the higher cost of our Brazilian inflation-linked debt, more than offset this higher cost at the EBITDA level by revenues indexed to inflation. Excluding Brazil, cost of debt decreased to 2.89%. Non-debt related costs improved by EUR 124 million, including a one-offs linked to the Spanish court rulings, as I have said previously, and Wallbox capital gains, partially compensated by the negative impact of positive FX hedges in 2020. As the chairman has pointed out, the Iberdrola balance sheet is well positioned for the rise in inflation and interest rates, as we have had a prudent approach in funding.
Our debt is 80% fixed if we include EUR 4.7 billion of forward-starting swaps. As you can see in the slide, we have a fixed debt structure much higher than our fixed revenue structure. Our average life of debt is around six years. The only exception in our debt is Brazil, which is inflation-linked indexed as our revenues, as I have commented, are directly linked to Brazilian inflation. Our adjusted net debt was EUR 39.1 billion affected by investments, organic, non-organic, and work in progress that grew EUR 2 billion, FX and working capital impacts accounted for in the last quarter that will be mostly recovered in 2022. Our cash flow generation grew 8.6% to close to EUR 9 billion. As a consequence, we maintain solid credit metrics. Our adjusted net debt EBITDA improved to 3.2x.
Our FFO adjusted net debt reached 23%. Our retained cash flow adjusted net debt is 20.6%, and our adjusted leverage improved to 41%. Reported net profit increased 7.6% to EUR 3,885 million. Excluding the already explained impacts from Spanish court rulings and legal measures, the U.K. deferred taxes and efficiency measures and one-off provisions, adjusted net profit reached EUR 3,705 million, in line with the guidance provided previously. Thank you. Now the chairman will conclude the presentation.
Thank you, José. As you have seen, 2021 has been a good year for Iberdrola thanks to our strong operational performance in a very complex market environment. The EUR 10 billion invested has allowed us to increase our network asset base and our renewable capacity, offsetting the negative impact of higher spot pricing in our retail activities. We also benefited from new tariff frameworks and continue improving our operating efficiency and financial structure. This positive trend is expected to continue in 2022. We'll put in operation 3,100 MW of new renewable capacity for a total of more than 7,000 in just two years. In networks, we will continue expanding our asset base, both in distribution with tariff frameworks for 2022 already set in our countries and in transmission, mainly in Brazil.
These factors will drive strong cash flow generation, which along with our active debt management, will maintain our financial strength. We have several safeguards to protect the company from inflationary pressure as planned. As a consequence, we are reaffirming today our net profit guidance for 2022 to EUR 4 billion-EUR 4.2 billion and a dividend growing in line with net profit growth. To conclude, in this 2021, Iberdrola has delivered strong results and has improved its positioning to benefit from the investment cycle we are entering the industry, driven by the urgent needs of cleaner and more competitive energy as well as reliable and resilient infrastructure. We are currently finalizing an update of our business plan for the coming years. As Ignacio was commenting, we'll show you in detail in our Capital Markets Day in March 2022.
I hope to see you in London. Now, Ignacio, we will start the Q&A session. Thank you.
Okay, let's start with the Q&A session. First question comes from Javier Suarez, Mediobanca, and Rob Pulleyn, Morgan Stanley. It's about the guidance. Does the EUR 4.0 billion and EUR 4.2 billion 2022 guidance include PNM Resources? If not, how will we compensate it? Does the 12 billion euros EBITDA indication still apply?
We feel comfortable with our net profit outlook of EUR 4 billion-EUR 4.2 billion, which even with the delay of PNM Resources contribution. Thanks to from one side the normalization of the energy markets. I think high prices affected, as I mentioned, negatively to our retail activities in 2021, especially U.K. and other countries as well. Higher regulated assets in networks, around EUR 5 billion in both years, in 2021 and 2022. We are going to start, as I mentioned, increase our capacity renewables in both year close to 7,300. We expect the recovery wind resource after very unusual year. For instance, I think in Britain especially this year in Britain the production is increasing by 40% and close to 20% United States.
I think, because I imagine you are going to make to me the question about the Spain's today lower hydroelectricity in Spain. I think partially is going to be compensated, not only because of this increase in renewable production and in installed power, but as well, even in hydroelectric with the Tâmega. The Tâmega River is beginning in operation at now already and as well in Brazil, what we are in this moment, almost doubling the production towards previous year. Of course, we will continue with our operating operational efficiency, operational measures to reduce cost.
Second question comes from Jorge Guimarães, JB Capital, and is related to the reporting of this set of results. Should we read any strategic reorientation from the decision to merge the reporting lines of renewables and liberalize and supply?
I think it's José mentioned we are committed with transparency. I think we understand that this breakdown reflects better the reality of the dynamics of this particular situation. I say this particular situation of the markets. I think on one hand, we have already regulated network activity. That's clear, everybody understand very well. I think on this side, we have non-regulated activities that we sell our renewable production and our production forward to our customers. Therefore, it makes no sense to reflect theoretical positive or negative margin between renewables and retail. They are not impacting our consolidated basis. We are not already selling at pool prices. We are selling at fixed prices, the agreement with our customers and according with the cost we are already generating.
I think that for this reason, I think that already give more clarity in this particular pricing scenario. I think you can imagine if there are any additional cost, we have to pass already to the customers if there are any increases for whatever reason. I think that's why I think they give better. We're going to do in the future. Your Investor Relations will explain to you. I think I would like to say that that is very particular scenario we are seeing. We have not really never seen a situation where the prices move from 50 to 200 at the pool prices, but we've not been selling at 200.
I think I would like to insist, if instead of selling at the price we've been selling, we had already been selling at 200, our result had already doubled. I think that is a good, clear message that we have not really had windfall profit. The windfall profit was not a reality because we have never been selling our power, our energy at the pool prices, especially the Spanish market. Just the opposite. I think the opposite, that we had already been keeping and maintaining our policy of fixed prices to our customers.
That has already, many countries has already produced already negative effect, not only not benefiting, but negative effect because in the case we have not already enough power, we've been forced to buy already in the market at higher prices, which is, for instance, the case of the United Kingdom.
Next question comes from Ahmed Farman. Do we expect further regulatory intervention as prices remain high? Ahmed comes from Jefferies, sorry.
I think it is the European Commission has reacted quickly to the current price environment scenario, publishing a toolbox. I would like to emphasize this one because I think it has already been clear rules were to be made. For one side, the reason of the current prices is the gas is responsible for that one. The second one is reaffirming the market principle and the good functioning of the CO2 market, the ETS. The third one urges the member state to accelerate the deployment of renewables. Now it is even more needed, not only because of the prices of the emission, but as well for diminishing the external dependency of energy. We are already suffering at this moment problems of price because we have external dependency.
If instead of that, we will have already our own energy production that will help on that one. Include as well measures to lower energy bills, mainly to benefit customers without affecting the market. It incentivize bilateral contracts, exactly what we are doing. I think we need to make more and more bilateral contracts. I think thanks to this bilateral contract, in our case, we have already managed to maintain the price to our customers. The bill mostly has not been affected to most of our customers for this changing of the spot market. I think if we had not really had that one, I think the situation will be much worse.
I think the situation in the U.K. with the intervention a few years ago with the price cap shows that artificial market intervention usually provide undesired result to customers and taxpayers. At the same time, they're damaging the retail companies as well. In any case, I would like to insist we have not already had windfall profit, as you can see in our 2021 result. But I would like to be clear, any tax increases is an increasing cost. And any increasing cost, that will reflect it in the price in one manner or another in the future.
Next question comes from Gonzalo Sánchez-Bordona, UBS, and Jorge Guimarães, JB Capital. What is your expectation regarding the clawbacks in Spain? Do you think the gas clawback will be extended beyond Q1 2022? When do you expect the CO2 clawback to be passed, and in which form?
I would like to insist already that what the European Commissioner has already said about the situation of prices. I think this toolbox reaffirms the principle of the good function in the CO2 market, identifies the gas as the reason of the current prices, asks member states to accelerate deployment of renewables, includes measures to reduce bills mainly to vulnerables, incentivizes bilateral contracts. I would like to insist because I think it's clear, this point. Nevertheless, I will give you a final idea when we see the final outcome. I would like only to give you some numbers.
The cover actions, revenues, according to European Union, have to be used to protect the vulnerable customer in European Union. That is what it recommends. I think only in the case of Spain, the collection this year at today's prices, the carbon prices, is close to EUR 6 billion. EUR 6 billion, which can be easily to be used for already those which are vulnerable. I would like to insist again, if there are any additional cost in our prices with whatever type of taxes, charges or whatever thing, that increase the cost of power generation, and that will already force to modify and increase the prices to our consumers. The fact our contracts with the customers at a fixed price is reflecting this possibility.
Next question comes from Harry Wyburd, Bank of America Merrill Lynch, Javier Suarez, Mediobanca, Jorge Alonso, Société Générale, and Ahmed Farman, Jefferies. Can you give us details for your forward selling strategy in Spain and the U.K. in terms of volume and prices? Would you expect positive outlook prices to persist in 2023 and beyond?
Selling strategy. Perhaps, Armando Martínez, you can already explain this one. I think it's selling strategy for Spain. How is the position in our price? That is the question, no?
If we see this trend in 20-
Yeah, yeah. You make the comments.
Okay. Good morning, everybody. For us, let me try to give you some flavor about retail business. For instance, in 2021, we have sold around EUR 85 per Kilowatt-hour. Once included all costs of retail margin, that is all the cost. But this is equivalent to around EUR 60 of wholesale price, okay, for our product, for our own production. That's this price will continue same level more or less to 2022, and this will allow us to maintain the strategy of providing long-term contracts and maintain fixed prices to our customers. This is what we are doing now to try to sell fixed prices to alleviate the high prices of energy.
I think it's very important to know, as the chairman is saying, that we are not benefiting from any windfall profits. We are able to sell our own electricity around a price that is slightly higher than the cost itself of our production. In the U.K., I think, the chairman has explained about what is the situation now with the price cap, and we will see what is going on in the next months.
Next question comes from Jorge Alonso, Société Générale, and is related to a kind of additional color in the U.K. supply unit for 2022. Perhaps you can already explain, Armando.
Okay. Again, I think you know how the situation of the U.K.'s retail business last year, very pressed about this price cap. Again, I think the situation now is the result of a very poor design of the price floor. The price cap has become the price floor. I want to remind again and repeat that this is when you intervene the markets like this, the situation is something that we are seeing in the U.K. The situation is that more than 30 retailers has been failed during this situation, and this have an extremely high cost that will be paid for the rest taxpayers.
We have been waiting for Ofgem in order to have a response of this situation, and we heard about that, the price cap update. I think they have gone in the positive direction, but that does include all the costs, and we will see what is going on about methodology for the next price cap, things about that. Many things we still need to hear about how to do that. But again, this is a perfect example of what happens with market intervention. At the end, these measure don't work and companies fails, customer are not benefited, and taxpayers needs to pay the cost.
Nevertheless, I think it is, as I mentioned before, the measures already taken are in the good direction. I think recognizing mostly the costs incurred, but I think it still is not enough. I think we have already generated certain losses in the past, then one way or another, we have to recompensate it. I think for the time being, they are trying to solve the future, but it's still not solving what we have already suffered in the past. I think we have already now in talks with the regulator, and we hope that we'll reach a good agreement for the future. I think it's positive, the move, but it's not enough.
Next question comes from Alberto Gandolfi, Goldman Sachs. Can you update on the IRRs you are seeing on recent renewable awards? Are you seeing PPAs, FITs adjusting to reflect equipment cost inflation?
IRR? I think it's, as I mentioned, we sell most of the energy to our customers. We are not already dependent of the auction, I think we're dependent of the market condition. I think it's clear the competition in this segment is increasing the market, and I think that is impacting the lower added-value technologies. It's starting more to lower added-value technologies, like PV, than other, like offshore. I think we are convinced that offshore gives good opportunities, and that's why we are reading that one, and the spread in this segment still is much higher than other one. Nevertheless, I think we are seeing the prices are increasing in most, either in the, especially in PPAs, partially to the higher CapEx.
I think I was already last week in the U.S., and I was talking with our people there, and the PPAs they are saying in this moment are really higher prices than they were before because I think simply because the CapEx I think is higher than they were. Nevertheless, I think we have already on the 22nd, we can already provide you more detail on the 2nd of March of all these things in our Capital Markets Day . I think certainly the prices are going to be affected, higher prices because higher CapEx. I think in our case most of electricity is not dependent on auction, is dependent on how agile we are ready to move in the different markets.
Ahmed Farman and Harry Wyburd from Bank of America are interested in knowing the potential spin-off of the offshore wind business.
I would like to say that in this moment, it's not in our table. As you know, we are already now focused in a different manner with more partnership with other companies as you had already seen and I already presented. It still is an option. I think it's not in our table, but it's an option. Now we are focused in partnership with other companies more than making already an IPO on this segment.
Some professionals want to know the latest trend in input costs of our investments.
The input cost?
Number one.
Latest trends, I think, with our input cost. So far, I think we have around 708,000 MW under construction, as I mentioned. I have to say that, and I think that was informed last week in the U.S. as well, we have only been affected in two solar projects, United States, with altogether $300 million, if I remember. One is Macon and another one, beer, Great Beer or One Beer or something like that. I think 300 MW in 7,800. The news I got, I think that was because of the suppliers' solar panels, but I think because they had certain delays. I think as far as I know, that has been already solved.
The terms have been agreed, and I think they're expecting that this starts to receive during this quarter and beginning next quarter. I think we are going to have major delays on that one. In terms of for the future, for 2022, I mentioned already our equipment I think is mostly purchased globally. We have already advanced orders in the last 2 years for EUR 20 billion, as I've been telling you in the last meetings. 80%-90% of these CapEx are already fixed cost before we take the investment decision. I think we fixed the prices of the equipment prior to taking the investment decisions.
I think also we use hedges for our major procurement costs, especially in things which are related with FX, which I think José has done good work on that one for avoiding surprises in this area.
Next question comes from J.J. Ruiz, Barclays, and Jorge Alonso, Société Générale, and it is the following: How will you cover the shortfall in hydro production in Q1 in Spain? Will there be a cost implied in this move?
Well, as I mentioned already, we have already our energies solved. All our estimates contemplate already this scenario. I think we have enough power CCGTs for already providing this. But I think as I mentioned, I think it's Spain is a piece in the global. Spain can be affected in hydro, but I think Spain and Portugal are already the same market. Tâmega is already now in operation, and Tâmega alone is over 1,000 MW of power, which I think is roughly 10% of our total hydroelectric power in Spain.
Also, I think we are already compensated with, as well with, other countries with the wind and the new renewable we are building in the country. I think we are not any longer a company we are depending on hydroelectric condition of Spain. We are a company we are more global, and I think if the Spanish drop, as last year was already very low production of wind, as I mentioned in U.K., a very bad year in wind as well, United States. With this year is precisely the opposite direction, much higher production. Last year was very bad in Brazil. This year we are almost doubling the production of hydroelectric in Brazil.
I think that will affect, but in the global terms will not really affect almost nothing because we'll be compensated with the production in other places.
Question 11 comes from Alberto Gandolfi, Goldman Sachs. My opinion is that it has something to do with the next 22nd March event, but I'm going to read it. There seems to be no shortage in opportunities in green energy. How do you plan to fund this while still creating value for shareholders? Do you still see balance sheet headroom, or do you need disposals?
Well, as you mentioned very well, I think it's a question that we are going to comment to you in the next Investor Day on 22nd of March. Probably we'll use all means for really funding that one. I think we have already plenty of ideas how to finance all those things. No, of course, not equity, as José mentioned to me. Not equity, except a note.
Next question from Rob Pulleyn, Morgan Stanley, and it's regarding PNM deal. What gives Iberdrola confidence it can overturn the existing opposition to the deal and that this will proceed in 2023?
Well, I think the opposition doesn't exist. I think it's either of the 23 or 24 parties involved in the deal, which represent all the sectors of the New Mexico economy and the New Mexico population are in favor. The second one we have the full political support of that one. The third one we have all federal permits. It's only that one. I think I heard already that the Attorney General also is already taking action against the regulator, and we are already in this moment already going together with PNM to the Supreme Court of New Mexico because the decision they took, nobody understand.
I think it's 23 parts of the 24 already approving and supporting that one, which are those parts represent the immense majority of the New Mexican people. That's why I think the attorney general and the government and the society are very supportive. I think we are very confident that that is going to happen. That's why we already went to the Supreme Court, and we expect that we have already positive answer in the near future.
Next question comes from Harry Wyburd, Bank of America, Jorge Guimarães, JB Capital, and Jorge Alonso, Société Générale. What is the current outlook in Mexico, given recent comment from the Mr. AMLO? Are you confident you can maintain your operation and earnings?
Well, I have to say that we continue operating normal, in the normal condition. I think it's there already a constitutional reform which is still in the Congress. I think we will see how it evolve, and we will see what is the final decision. I think it's at the level of availability and utilization of our plant is well above 80%. I think it's well in the normality. I think that is what I can say.
Next question comes from Gonzalo Sánchez-Bordona, UBS, and probably is related to José. What is the reason for the negative working capital evolution in Q4? And which amount do you expect to recover, and when?
José?
Yeah. Hi, Gonzalo. I mean, yeah, we had a relatively large impact. The largest part of the impact comes from the VAT. As you know well, the VAT is paid on the spot prices. As the spot prices were high, we had to pay the 21%. In addition to that, now we are charging a 10% to customers, so there is a big distortion there. Well, more than EUR 500 million, and we are expecting to recover that in six months. The other element has been that we have a volatility in commodities derivative settlements. Obviously, we are expecting also to recover that. It is difficult to say, but we are expecting to recover that also.
Finally, there was some delays in invoicing due to all the regulatory changes that we have seen in Spain, and obviously that will be recovered in the next month. I would say that between three and six months, we will recover most of the negative working capital movements.
Next question comes from Javier Suarez, Mediobanca, and is related to the Senate case and the possible calendar of this thing.
I think regarding this case, we have already provided all the information to the investigation. I think we've been for years not having access to the files. We had already offered last year to the investigation team the testimony of any director or employee of the company. I think finally, we have already had the opportunity of making these testimonies. This matter now is in the hands of our legal services. Maybe, I think Gerardo Codes, our business legal director, can give you more detail. Gerardo, can you explain?
Okay, Chairman, thank you. The latest facts clearly show that the investigation is being promoted by a competitor who is using his position in the process to try to damage the company's reputation in its own interest, okay? The procedure could still take some time. After the testimonies, this case is now only one more of the thousands that we have all over the world because we maintain the same conclusion. There is no irregular conduct for any employee or director based on the conclusions of the internal investigation, which is based on an independent forensic carried out by PwC with no limitation, and all the clarifications given to the judge by employees and directors.
We have asked for legal opinions to different Spanish and international law firms, Garrigues, Baker McKenzie, Allen & Overy, and their conclusion are that there is no case under Spanish law and under U.K. and U.S. law. This case against the directors and employees that are currently in Iberdrola would not even be presented by a prosecutor to a court or a jury.
Thank you very much. Ignacio, more questions?
Okay. No. As today is a day full of results, we want to keep our commitment to be in relation to the duration of this conference call. This is why I'm now passing the floor or give you the floor to conclude this event, Mr. Galán.
Thank you very much for taking part of this conference call. Let me remind you that, always, as always, our Investor Relations team will be available for any further information you may require. In a month, we will be present in London, and we will update our business plan in our next capital market, and I'll be very pleased to have the opportunity to meet all of you. Thank you very much and see you in March. Thank you.