Spanish utility Iberdrola has reported increasing its 2006 full year profit by a healthy 20.1% on the back of price rises and higher volumes sold.

The renewable energy expert, which has a sizable ‘green’ energy portfolio, said that its net profit came in at E1.66 billion, E280 million up on the 2005 income of E1.38 billion. Meanwhile, earnings before tax and other standard considerations were E3.89 billion, a 15.2% improvement on the figure for fiscal 2005.

Fourth quarter profit rose 6.5% on higher prices and increased volume sales, allowing Iberdrola to deliver net income for Q4 of E424 million.

The financial declaration comes as Iberdrola, Spain’s second largest utility, is in the middle of a process to acquire UK energy firm ScottishPower. It also comes as fresh speculation has linked the Iberian power provider to another possible future merger, this time with domestic compatriot Union Fenosa.