Iberdrola S A : Supplement to the information memorandum relating to the terms and conditions of the second edition of the "Iberdrola Retribución Flexible" optional dividend system corresponding to the fiscal year 2020

Julián Martínez-Simancas

Secretary of the Board of Directors

Bilbao, 8 January 2021

To the National Securities Market Commission

Subject: Other relevant information / Supplement to the information memorandum (documento informativo) relating to the terms and conditions of the second edition of the "Iberdrola Retribución Flexible" optional dividend system corresponding to the fiscal year 2020

Pursuant to article 227 of the restated text of the Securities Market Law approved by Royal Legislative Decree 4/2015, of 23 October (texto refundido de la Ley del Mercado de Valores aprobado por el Real Decreto Legislativo 4/2015, de 23 de octubre) and related provisions, and further to our notices of other significant information (comunicaciones de otra información relevante) filed with this National Commission on 21 October 2020 and 15 December 2020 (with official registry numbers 5,108 and 6,219, respectively), we hereby advise you that on the date hereof the matters summarised below regarding the terms and conditions of the second edition of the "Iberdrola Retribución Flexible" optional dividend system corresponding to the fiscal year 2020 have been determined.

In particular, the following matters have been determined in connection with: (a) the implementation of the second paid-up capital increase approved by the General Shareholders' Meeting of Iberdrola, S.A. ("Iberdrola") held on 2 April 2020 under item number fourteen on the agenda and under the section titled «Common terms and conditions of the dividend distribution and increase in capital resolutions proposed under items number twelve, thirteen and fourteen on the agenda, by virtue of which the "Iberdrola Flexible Remuneration" optional dividend system is implemented» (the "Capital Increase") and (b) the distribution of an interim dividend corresponding to the fiscal year 2020 (the "Interim Dividend"):

1. The maximum market value of reference for the Capital Increase amounts to 1,085 million euros. This amount guarantees a gross amount of the Interim Dividend of, at least, 0.168 euros per share.
2. The maximum number of shares to be issued by means of the Capital Increase is 90,715,157.
3. The number of free-of-charge allocation rights required to receive one new share is 70.
4. The maximum nominal amount of the Capital Increase is 68,036,367.75 euros.
5. The gross amount of the Interim Dividend per share is 0.168 euros.

NOTICE: This document is a translation of a duly approved Spanish-language document, and is provided for informational purposes only. In the event of any discrepancy between the text of this translation and the text of the original Spanish-language document which this translation is intended to reflect, the text of the original Spanish-language document shall prevail.

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1. The aggregate maximum gross amount of the Interim Dividend is 1,066,810,248.00 euros. This amount results from multiplying the total number of outstanding shares of Iberdrola as of the date hereof1 (without deducting Iberdrola's treasury stock) by the gross amount per share previously mentioned (i.e., 0.168 euros).

Likewise, and for the purposes of article 1.5.(g) of the Regulation (EU) 2017/1129 of the European Parliament and of the Council, of 14 June 2017, on the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market, and repealing Directive 2003/71/EC (the "Regulation"), we provide you with the supplement to the information memorandum (documento informativo) regarding the implementation of this second edition of the "Iberdrola Retribución Flexible" optional dividend system corresponding to the fiscal year 2020, which is attached as an annex and which has been approved today.

In this respect, pursuant to article 1.5.(g) of the Regulation, the admission to trading of the new Iberdrola's shares issued within the context of the optional dividend system "Iberdrola Retribución Flexible" shall not entail the obligation to publish the prospectus established in the Regulation, "provided that the said shares are of the same class as the shares already admitted to trading on the same regulated market and that a document is made available containing information on the number and nature of the shares and the reasons for and details of the offer or allotment".

Likewise, it is stated that the aforementioned information memorandum (documento informativo), together with its referred supplement, constitutes the document referred to in article 1.5.(g) of the Regulation, and renders the preparation and publication of a prospectus (folleto informativo) with respect to the Capital Increase unnecessary.

Please be advised that the summary included above is part of the supplement to the above referred information memorandum, and should therefore be read in conjunction with such supplement.

This information is provided to you for the appropriate purposes.

Secretary of the Board of Directors

1 Assuming that the number of outstanding shares of the Company as of 13 January 2021 (record date) will be the same (i.e., 6,350,061,000 shares).

NOTICE: This document is a translation of a duly approved Spanish-language document, and is provided for informational purposes only. In the event of any discrepancy between the text of this translation and the text of the original Spanish-language document which this translation is intended to reflect, the text of the original Spanish-language document shall prevail.

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IMPORTANT INFORMATION

This communication does not constitute an offer to purchase, sell or exchange or the solicitation of an offer to purchase, sell or exchange any securities. The shares of Iberdrola, S.A. may not be offered or sold in the United States of America except pursuant to an effective registration statement under the Securities Act or pursuant to a valid exemption from registration.

This communication contains forward-looking information and statements about Iberdrola, S.A., including financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future operations, capital expenditures, synergies, products and services, and statements regarding future performance. Forward-looking statements are statements that are not historical facts and are generally identified by the words "expects", "anticipates", "believes", "intends", "estimates" and similar expressions.

Although Iberdrola, S.A. believes that the expectations reflected in such forward-looking statements are reasonable, investors and holders of Iberdrola, S.A. securities are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of Iberdrola, S.A., that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. These risks and uncertainties include those discussed or identified in the documents filed by Iberdrola, S.A. with the Comisión Nacional del Mercado de Valores and which are not available to the public.

Forward-looking statements are not guarantees of future performance. They have not been reviewed by the auditors of Iberdrola, S.A. You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date they were made. All oral or written forward-looking statements hereby made or otherwise attributable to Iberdrola, S.A. or any of its members, directors, officers, employees or any persons acting on its behalf are expressly qualified on its entirety by the cautionary statement above. All the forward- looking statements included herein are based on information available to Iberdrola, S.A. on the date hereof. Except as required by applicable law, Iberdrola, S.A. does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

NOTICE: This document is a translation of a duly approved Spanish-language document, and is provided for informational purposes only. In the event of any discrepancy between the text of this translation and the text of the original Spanish-language document which this translation is intended to reflect, the text of the original Spanish-language document shall prevail.

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Annex

Supplement to the information memorandum relating to the terms and conditions of the second edition of

the "Iberdrola Retribución Flexible" optional dividend system corresponding to the fiscal year 2020

NOTICE: This document is a translation of a duly approved Spanish-language document, and is provided for informational purposes only. In the event of any discrepancy between the text of this translation and the text of the original Spanish-language document which this translation is intended to reflect, the text of the original Spanish-language document shall prevail.

www.iberdrola.com

Take care of the environment.

Printed in black and white and only if necessary

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