Under the contract, Iberdrola will construct, own, operate and maintain the power generation plant which can generate electricity required to power 2 million Mexican consumers.
The Mexican Federal Electricity Commission (CFE) will purchase the power generated from the facility under 25-year power purchase agreement with fixed capacity charges.
Constriction work on the Noreste power plant is scheduled to be commenced in early 2016 and be completed in July 2018.
Iberdrola will also develop infrastructure including the power lines and the transformer substation, required for connecting the power plant to the national electricity system.
Mitsubishi Hitachi Power Systems (MHPS) will provide gas turbines and a steam turbine for the Noreste station, which will also feature Foster Wheeler-built boilers.
In June, Iberdrola has agreed to develop energy projects in Mexico, in partnership with the Federal Electricity Commission (CFE), as part of the framework of the cooperation agreement signed in May 2014.
Iberdrola is planning to invest up to $5bn in the country over the next five years.
The company, till date, invested over $1bn in energy generation projects in Mexico. It is developing two new combined-cycle power plants, three cogeneration plants as well as the Pier 2 and Dos Arbolitos wind farms.
Image: A Mexican combined cycle power plant located n La Laguna. Photo: courtesy of Iberdrola, S.A.
