Proxy Statement 2023				Notice of 2023 Annual Meeting

Notice of 2023 Annual Meeting of Shareholders

Items of Business 

Record Date

Date These Proxy Materials Are First Being Made Available

Sincerely,

R. Scott Mahoney

Senior Vice President – General Counsel and Corporate Secretary

180 Marsh Hill Road

Orange, Connecticut 06477

		Proxy Statement 2023				Table of Contents

Table of Contents

		Proxy Statement 2023				Proxy Statement Summary		|     1

Proxy Statement Summary

This summary highlights the proposals to be acted upon, as well as corporate governance and compensation information described in more detail in this proxy statement for our 2023 annual meeting of shareholders (the “Annual Meeting”). In addition, this summary provides a brief description of our purpose and values and sustainability achievements during 2022. In this proxy statement the terms “Avangrid,” “company,” “we,” and “our” refer to Avangrid, Inc.

		Proxy Statement 2023				Proxy Statement Summary		|     2

Attending our Annual Meeting

The health and well-being of our employees and shareholders are paramount. Shareholders who seek to attend the Annual Meeting in-person may be subject to screening with regard to COVID-19 exposure.

We continue to monitor developments related to COVID-19 and there is a possibility that we may reconsider the date, time, method, and/or location of the Annual Meeting, including by changing the format of our meeting to limit attendance and participation to a virtual format. If we determine it appropriate to make such changes to the Annual Meeting logistics, we will announce the decision to do so in advance.

		Proxy Statement 2023				Proxy Statement Summary		|     3

How to Vote and Matters to Be Voted On

		Proxy Statement 2023				Proxy Statement Summary		|     4

Director Nominees

Key Statistics

		Proxy Statement 2023				Proxy Statement Summary		|     5

Purpose and Values

Our purpose reflects our commitment to transforming the current energy model towards a new one that prioritizes the well-being of people and the conservation of the planet:

OUR VALUES

For more information about our purpose and values, please see the Corporate Governance section at www.avangrid.com.

		Proxy Statement 2023				Proxy Statement Summary		|     6

Committed to Sustainable Development

Sustainability is firmly entrenched in the values and principles that guide our board of directors, and respect for people, safety, communities, and the environment are key priorities driving our business strategy. In 2016, we pledged to reduce emissions intensity from our power plants 25% by the end of 2020 compared to 2015, and to be 100% carbon neutral by the end of 2035, making Avangrid the first U.S. utility to set a goal for carbon neutrality. In September 2022, we announced new and expanded environmental, social, governance, and financial stewardship (“ESG+F”) goals to reflect the breadth of our commitment to sustainability. We added eight new goals that include commitments to implement new emission reducing technologies, improve employee safety and cybersecurity, and maintain our best-in-class compliance and governance practices. Our most aggressive environmental commitment is to speed up our carbon neutrality targets to reach carbon neutrality in both our Scopes 1 and 2 emissions by 2030 - five years faster than our prior commitment which focused solely on our Scope 1 emissions. Avangrid continues to be one of the cleanest energy companies in the U.S. with an intensity emission approximately six times lower than the U.S. utility average in 2021.⁽¹⁾ These commitments are articulated in our sustainable development policies, which have been adopted by our board and are available in the Corporate Governance section of www.avangrid.com, and support the Sustainable Development Goals (SDGs) approved by the member states of the United Nations.

Our actions, investments, and goals to address climate change reflect our net zero strategy, and we continue to see positive impacts of these actions across our operations. In 2022, these impacts included the following:

In 2022, we continued to be recognized for our ESG leadership, including receiving the following awards and recognitions:

		Proxy Statement 2023				Proxy Statement Summary		|     7

2022 Business Highlights

At Avangrid, we are accelerating America’s clean energy transformation. By defining a clear focus on operational and financial excellence, consistent execution, and sustainable value creation, we delivered on our strategic objectives and drove growth in 2022. Highlights of our performance include:

		Fiscal year 2022 consolidated net income of $881 million (or $2.28 per share); consolidated adjusted net income of $901 million (or $2.33 per share)(1) increasing by approximately 25% and 16% year-over-year, respectively. In addition, we invested $2.7 billion in our Networks and Renewables businesses and announced a plan to invest $21.5 billion through 2025.
		Delivered strong operating performance in Networks, including double-digit improvements year-over-year in average reliability across our electric utilities, 8% rate base growth, and superior storm response recognized by the Edison Electric Institute. In addition, we filed rate cases to drive continued investments in grid modernization and clean energy transformation.
		Brought ~400MW of new onshore wind and solar into operations, including Avangrid’s largest solar project and delivered high energetic availability across our fleet. As of April 17, 2023, we have ~1.4 GW of additional onshore and offshore renewables capacity under construction and expected to come online in 2023 and 2024.
		Signed agreement with Sempra Infrastructure to support potential joint development of green hydrogen and ammonia projects and engaged in seven hydrogen hub coalitions nationwide.
		Initiated export cable installation and manufacturing of all major components for Avangrid’s 806 MW Vineyard Wind 1, putting our landmark project on track to deliver its first power by the end of 2023.

		Proxy Statement 2023				Proxy Statement Summary		|     8

Executive Compensation Highlights

Our executive compensation program is designed to effectively reward performance while reflecting the responsibilities of our executive officers. Our compensation philosophy is to offer compensation that makes it possible to attract, retain, and motivate highly-talented professionals in a way that aligns with our long-term business goals and values, without motivating or rewarding excessive risk-taking. At our 2022 annual meeting, approximately 99% of the votes cast were in favor of our named executive officer compensation.

The key elements of our program are:

		Proxy Statement 2023				Proxy Statement Summary		|     9

Corporate Governance Highlights

We believe that effective corporate governance is not a one-size-fits-all approach. We carefully consider our corporate governance practices to ensure that they are appropriately tailored to our business and promote the long-term interests of our shareholders. We encourage constructive dialogue with and feedback from all our shareholders to help shape our governance practices. Highlights of our corporate governance include:

		Proxy Statement 2023				Directors		|     10

Directors

This section describes the director nomination process and the experience and qualifications of our board members and how they are compensated.

		Proxy Statement 2023				Directors		|     11

Director Nomination Process

The compensation and nominating committee (formerly known as the compensation, nominating and corporate governance committee) is responsible for identifying and evaluating potential director candidates, reviewing board and committee composition and making recommendations to the full board. In order to maintain a board with an appropriate mix of experience and qualifications, the compensation and nominating committee routinely assesses the composition of the board. While the compensation and nominating committee has not established minimum qualifications, it aims to strike a balance between the knowledge and understanding of the business that comes from longer-term service on the board with the fresh ideas and perspective that can come from adding new members and also considers the expertise and cognitive diversity that is needed as our business changes and expands, as well as the importance of diversity of age, gender, race, ethnicity, culture, thought, geography, and nationality on the board. The compensation and nominating committee may engage an external search firm or a third party from time to time to assist it in identifying and evaluating director-nominee candidates, in addition to current members of the board standing for reelection.

Our criteria for directors are discussed in our corporate governance guidelines and compensation and nominating committee charter, copies of which are available on our website at www.avangrid.com. Consistent with these guidelines, the compensation and nominating committee ensures that the nominees are qualified with relevant expertise, competence, experience, and training. Each nominee must also have the time and commitment to meet their respective responsibilities as a member of the board of directors. The compensation and nominating committee has no specific policy on diversity. However, Avangrid is committed to cultivating a diverse and inclusive work environment and the board recognizes the benefit of having directors who reflect differing individual attributes to contribute to the board’s discussion, evaluation, and decision-making, and considers diversity of knowledge, experience, origin, nationality, and gender. In the board’s annual performance evaluations conducted by the board and its committees, the board from time to time considers whether the members of the board reflect such diversity and whether such diversity contributes to a constructive and collegial environment.

The compensation and nominating committee will consider persons recommended by shareholders for election to the board. The compensation and nominating committee will review the qualifications and experience of each recommended candidate using the same criteria for candidates proposed by board members and communicate its decision to the candidate or the person who made the recommendation. For the procedures for submission of stockholder nominations of members of our board, see “Other Information – Submission of Proposals by Shareholders.”

To recommend an individual for board membership, write to:

		Proxy Statement 2023				Directors		|     12

Director Qualifications and Experience

		Proxy Statement 2023				Directors		|     13

Your Board’s Nominees for Director

The following biographies describe the skills, qualities, attributes, and experience of the nominees that led the board, on the recommendation of the compensation and nominating committee, to determine that it is appropriate to nominate these individuals for election at the Annual Meeting to hold office until the 2024 annual meeting and until their successor is elected and qualified. All the nominees currently serve as directors and have indicated that they will be willing and able to serve as directors. All the nominees other than Mr. Delgado Martín were elected at the 2022 annual meeting of shareholders. On December 12, 2022, Mr. Josè Ángel Marra Rodríguez resigned from the board, and Mr. Delgado Martín was appointed to fill the vacancy. Mr. Delgado Martín was identified as a candidate by the chair of the board.

		Proxy Statement 2023				Directors		|     21

Director Compensation

Members of the board who are not employees of Avangrid (“non-employee directors”) received compensation for their board service, which is reviewed annually by the compensation and nominating committee and the board. For 2022, the board determined the form and amount of non-employee director compensation described below. In 2022, non-employee directors received an annual cash retainer of $140,000. In 2022, each of the chair and the vice chair of the board of directors received an additional annual cash retainer of $60,000; the chair of each of the audit committee, compensation and nominating committee, governance and sustainability committee, and the unaffiliated committee received an additional cash retainer of $30,000; and each non-employee director that was a member of one or more committees of the board received an additional cash retainer of $30,000. All retainers are paid in quarterly installments. The following table shows information regarding the compensation earned during 2022 by each non-employee director serving on the board during 2022. Our former Chief Executive Officer, Mr. Arriola was appointed to the board in July 2020 and notified Avangrid of his intention to leave the business, effective May 28, 2022, and did not receive any compensation for his service as a member of the board. On May 31, 2022, Mr. Arriola resigned from the board. As Mr. Delgado Martín joined the board on December 15, 2022, he did not receive any compensation as a director during 2022.

		Proxy Statement 2023				Directors		|     22

At its meeting on February 16, 2023, after reviewing the compensation and nominating committee’s recommendation and reviewing a comparison of compensation payable to comparable companies that qualify as “controlled companies” within the meaning of the NYSE rules, the board determined to maintain the same form but increase the amount of director compensation from 2022 for 2023. In 2023, each non-employee director will receive an annual cash retainer of $170,000. In 2023, the chair of the board will receive an additional annual cash retainer of $70,000 and the vice-chair of the board will receive an additional cash retainer of $40,000. In 2023, the chair of each of the audit committee, compensation and nominating committee, governance and sustainability committee, and unaffiliated committee will receive an additional cash retainer of $40,000 and each non-employee director that was a member of one or more committees of the board received an additional cash retainer of $30,000.

		Proxy Statement 2023				Corporate Governance		|     23

Corporate Governance

This section describes our governance and sustainability system and the role and structure of our board.

		Proxy Statement 2023				Corporate Governance		|     24

Governance and Sustainability System

Avangrid’s governance and sustainability system (the “Avangrid Governance and Sustainability System”) is integral to the company’s corporate purpose and the creation of sustainable value for society, customers, and shareholders. Reflecting the purpose and values of the Avangrid group, the Avangrid Governance and Sustainability System is inspired by and based upon a commitment to ethical principles, transparency, and leadership in the application of best practices in good governance, and is designed to be a working structure for principled actions, effective decision-making, and appropriate monitoring of both compliance and performance. Avangrid’s charter, by-laws, corporate policies, internal corporate governance rules, and the other internal codes and procedures approved or adopted by Avangrid’s board of directors form the framework of governance of Avangrid, including our corporate governance guidelines, code of business conduct and ethics, and committee charters. Reflecting our commitment to continuous improvement and best practices, the board approved a refreshment of the Avangrid Governance and Sustainability System that, among other things, established a new governance and sustainability committee responsible for overseeing and maintaining the Avangrid Governance and Sustainability System, Avangrid’s compliance with legal and regulatory requirements, oversight of Avangrid’s environmental, social, and governance (“ESG”) performance, activities and initiatives, and non-financial sustainability reporting. The Avangrid Governance and Sustainability System, including our corporate governance guidelines, code of business conduct and ethics, and committee charters are publicly available in the Corporate Governance section of Avangrid’s website at www.avangrid.com.

Board Leadership Structure

The board periodically reviews its leadership structure and the responsibilities and composition of its standing committees to determine whether they continue to serve Avangrid and its shareholders. The structure and composition of the board and its committees are intended to leverage the diverse experience of the board members and promote effective oversight.

The Avangrid Governance and Sustainability System allows the flexibility to separate or consolidate the positions of chairman of the board and chief executive officer. The board believes its current leadership structure, which separates the roles of chairman and chief executive officer, best serves the objectives of the board’s oversight of management, the board’s ability to carry out its roles and responsibilities on behalf of Avangrid’s employees, customers, shareholders and other key stakeholders, and Avangrid’s overall corporate governance. The board also believes that the separation of the roles of chairman and chief executive officer allows the chief executive officer to focus more of his time and energy on operating and managing the company and leverages the chairman’s experience in the energy industry.

		Proxy Statement 2023				Corporate Governance		|     25

The Controlled Company Exemption

Avangrid is a “controlled company” within the meaning of the rules of the NYSE because Iberdrola, S.A. owns more than 50% of the company’s outstanding shares of common stock. Consequently, Avangrid is not required to comply with certain of the NYSE listed company requirements, such as the requirement to have a majority of “independent” directors on Avangrid’s board of directors, or the requirement to have compensation and nominating/corporate governance committees comprised of fully “independent” directors. Nonetheless, the board has established a compensation and nominating committee and a governance and sustainability committee comprised of a majority of independent directors, and an unaffiliated committee, comprised solely of independent directors, to assist the board in exercising its oversight responsibilities.

Director Independence

Due to Avangrid’s status as a “controlled company,” we rely on certain exemptions from the rules of the NYSE that would otherwise require that our board be comprised of a majority of “independent” directors as defined under the rules of the NYSE. Avangrid is required to have an “independent” audit committee under the NYSE’s listed company requirements. See the section entitled “Corporate Governance—Audit Committee” for additional information.

The board has undertaken a review of the independence of each director nominee. Based on this review, the board has determined that each of Mmes. Báñez García, Herbert, Jacobs, and Joseph Varlack and Messrs. Baldacci, Duffy, Lahey, and Solomont do not have a material relationship with the Avangrid group of companies (either directly or as a partner, shareholder, or officer of an organization that has a relationship with the Avangrid group of companies) and that each of these nominees is “independent” under the rules of the NYSE.

Board Meetings

During 2022, the board held nine meetings, with each member of the board attending all of the board meetings. Avangrid expects all directors to attend the Annual Meeting of shareholders. All directors serving at the time attended our 2022 annual meeting of shareholders.

		Proxy Statement 2023				Corporate Governance		|     26

Committee Composition

The board has established five standing committees—an audit committee, compensation and nominating committee, governance and sustainability committee, executive committee, and unaffiliated committee. The board also has established an ad hoc special committee more particularly described below. The current composition and responsibilities of each standing committee is described below. Members serve on committees until their resignation or until otherwise determined by the board of directors.

Director

Audit Committee

Executive Committee

Unaffiliated Committee

Compensation and Nominating Committee

Governance and Sustainability Committee

Special Committee

Ignacio S. Galán

John Baldacci

Daniel Alcain Lopez

Pedro Azagra Blázquez

Robert Duffy

Teresa Herbert

Patricia Jacobs

John Lahey

Agustín Delgado Martín

Santiago Martínez Garrido

José Sáinz Armada

Alan Solomont

María Fátima Báñez García

Camille Joseph Varlack

  Chair                           Member

		Proxy Statement 2023				Corporate Governance		|     27

Audit Committee

The audit committee assists the board with oversight and monitoring of Avangrid’s financial statements and other financial information provided by Avangrid to its shareholders and others; compliance with legal, regulatory, and public disclosure requirements; the independent auditors, including their qualifications and independence; Avangrid’s systems of internal controls, including the internal audit function; treasury and finance matters; enterprise risk management; physical and cybersecurity; and the auditing, accounting, and the financial and non-financial reporting process generally. The audit committee also appoints Avangrid’s independent registered public accounting firm and pre-approves the services performed by such firm.

Mmes. Herbert and Varlack currently serve on and, during 2022, served on the audit committee, with Ambassador Solomont serving as the chair. Ms. Timm served on the audit committee during 2022 until her term ended on July 20, 2022 at the annual meeting of shareholders. All current members of the audit committee meet the requirements for financial literacy under the applicable rules and regulations of the NYSE. In addition, the board has determined that Ms. Herbert is an audit committee financial expert within the meaning of Item 407(d) of Regulation S-K under the Securities Act of 1933 and has the requisite accounting or related financial management expertise as set forth in the NYSE corporate governance rules. The board has determined that each of the members of the audit committee is “independent” as defined under the NYSE listing standards and under Rule 10A-3(b)(1) of the Exchange Act of 1934, as amended (the “Exchange Act”). The audit committee operates under a written charter adopted by the board in accordance with applicable rules of the NYSE and the SEC, which is available on the company’s website at www.avangrid.com. The audit committee met nine times during 2022, with each of the committee members attending all of the meetings.

Compensation and Nominating Committee

The compensation and nominating committee (formerly known as the compensation, nominating and corporate governance committee) is responsible for reviewing and approving executive officer compensation and executive incentive compensation plans and equity-based plans; administering the company’s executive incentive compensation plans and equity-based plans; reviewing, and recommending to the board for approval, director compensation; periodically reviewing the chief executive officer succession plan; determining the qualifications, qualities, skills, and other expertise required to be a director; and reviewing and making recommendations to the board regarding the selection and approval of the nominees for director. For a description of the compensation and nominating committee’s processes and procedures, including the roles of the independent compensation consultant and Avangrid’s executive officers in support of the compensation decision-making processes, see the section entitled “Executive Compensation—Compensation Discussion and Analysis.”

Ms. Jacobs and Mr. Sáinz Armada currently serve on and, during 2022, served on the compensation and nominating committee, with Mr. Lahey serving as chair. Ms. Jacobs and Mr. Lahey are “independent” as defined under the NYSE

		Proxy Statement 2023				Corporate Governance		|     28

listing standards applicable to compensation committee members. The company relies on the controlled company exemption from the rules of the NYSE that would otherwise require the compensation and nominating committee be comprised of solely “independent” directors as defined under the rules of the NYSE.

The compensation and nominating committee operates under a written charter adopted by the board, which is available on the company’s website at www.avangrid.com. The compensation and nominating committee held 13 meetings during 2022, with each committee member attending all of the meetings.

To the extent the board and compensation and nominating committee deem appropriate, executive compensation matters relating to or governed by Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), or Rule 16b-3 of the Exchange Act, are delegated to a subcommittee of the compensation and nominating committee comprised entirely of two or more directors who qualify as “outside directors” within the meaning of Section 162(m) of the Code and “non-employee directors” within the meaning of Rule 16b-3 of the Exchange Act (the “compensation subcommittee”). Ms. Jacobs and Mr. Lahey currently serve on the compensation subcommittee. The compensation subcommittee serves to (i) establish, administer, approve, and certify (for the purposes of satisfying the performance-based compensation exception under Section 162(m) of the Code, to the extent still applicable) performance goals for employee compensation awards and (ii) review and approve (for purposes of Rule 16b-3 of the Exchange Act) compensation grants and awards by the company of its securities to an officer or director of the company. Prior to the payment of any compensation awarded by the compensation subcommittee, all compensation decisions by the compensation subcommittee are subject to ratification from the full board.

Governance and Sustainability Committee

On October 19, 2022, reflecting the strategic importance of ESG+F, the board of directors established the governance and sustainability committee. The governance and sustainability committee is responsible for overseeing the company’s corporate governance policies and procedures, ESG risk management and non-financial sustainability reporting, the company’s compliance and ethics program, the company’s Governance and Sustainability System, and the board and committee annual self-evaluation process. Ms. Varlack and Mr. Sáinz Armada currently serve on and, during 2022, served on the governance and sustainability committee, with Ms. Báñez García serving as chair. Mr. Martínez Garrido served on this committee from its establishment in October 2022 until his resignation from the committee on December 14, 2022.

The governance and sustainability committee operates under a written charter adopted by the board in accordance with applicable rules of the NYSE and the SEC, which is available on the company’s website at www.avangrid.com. The governance and sustainability committee met once during 2022, with each of the committee members attending the meeting.

		Proxy Statement 2023				Corporate Governance		|     29

Executive Committee

The board has established an executive committee, which may exercise all the powers of the board when the full board is not in session, to the extent permitted by applicable law. In particular, the executive committee has not been delegated, and may not exercise, the authorities and duties assigned to the audit committee or the unaffiliated committee. Messrs. Azagra Blázquez, Lahey, and Sáinz Armada and Ms. Báñez García currently serve on and, during 2022, served on the executive committee, with Mr. Galán serving as chair. Mr. Arriola served on the executive committee during 2022 until his resignation from the board on May 31, 2022. The executive committee held three meetings during 2022, with each of the committee members attending all of the meetings.

Unaffiliated Committee

The unaffiliated committee was established in accordance with the shareholder agreement, dated December 15, 2015, between Avangrid and Iberdrola, S.A., (the “Shareholder Agreement”) and, among other things, is responsible for reviewing and approving all transactions entered into between the company and Iberdrola, S.A., or its affiliates, and ensuring that such transactions are entered into on an arms’ length basis. The unaffiliated committee operates under a written charter adopted by the board, which is available on the company’s website at www.avangrid.com. Ms. Jacobs and Mr. Baldacci currently serve on, and during 2022, served on the unaffiliated committee, with Mr. Duffy serving as the chair. The unaffiliated committee is comprised solely of “independent” directors. The unaffiliated committee held five meetings during 2022, with each of the committee members attending all of the meetings.

Special Committee

The board has established a special committee, which is responsible for, among other things, carrying out the responsibilities delegated by the board relating to oversight of New England Clean Energy Connect (NECEC) transmission line project. The special committee operates under a written charter adopted by the board, which is available on the company’s website at www.avangrid.com. Messrs. Azagra Blázquez and Martínez Garrido currently serve on and, during 2022, served on the special committee, with Mr. Baldacci serving as the chair. The special committee held seven meetings during 2022, with each of the committee members attending more than 85% of the meetings.

Executive Sessions

In accordance with our corporate governance guidelines, to ensure that non-management directors serve as an effective check on management and to encourage open discussion among such non-management directors, our non-management directors meet in executive sessions without management directors or management present on a periodic basis but no less than twice a year. Our chair, a non-management director, presides at these meetings. In accordance with the NYSE rules, our independent directors also meet in an executive session at least once a year. Mr. Lahey presided at the executive sessions of independent directors during 2022.

		Proxy Statement 2023				Corporate Governance		|     30

Annual Board Assessment

The board utilizes a comprehensive, multi-part process for its ongoing self-assessment to ensure that the board and its committees are working effectively together and its processes reflect best practices. The board also uses the results of this self-assessment process to assist it when reviewing its composition. While the formal self-assessment and independent corporate governance review described below is conducted on an annual basis, directors share perspectives, feedback, and suggestions continuously throughout the year. The governance and sustainability committee designs and establishes the overall assessment framework.

		Proxy Statement 2023				Corporate Governance		|     31

Risk Management Oversight

In the normal course of its business, Avangrid is exposed to a variety of risks, including political and regulatory risks, climate-related risks, credit and investment risks, and cybersecurity and other operational risks. In connection with the board’s oversight function, the board oversees management’s identification, assessment, and mitigation of risks related to our company, business, and people and Avangrid’s policies and procedures for managing risk.

Selected areas of board, committee, and management risk oversight in 2022:

Transparency

We publicly disclose information about our business across a number of topics including our environmental, social, and governance efforts across the company including our commitments, programs, and progress on our ESG+F goals. This includes our annual sustainability report, Global Reporting Initiative (GRI) report, EEI and AGA ESG/sustainability report, Sustainability Accounting Standard Board (SASB) report, and UN Energy Compact report, each of which is available in the Sustainability section of www.avangrid.com.

		Proxy Statement 2023				Corporate Governance		|     32

Shareholder Engagement

We proactively engage with shareholders and other stakeholders throughout the year to learn their perspectives on significant issues, including company performance and strategy, corporate governance, executive compensation, climate action, and other important ESG+F topics. This engagement helps us better understand the issues that matter most to our shareholders and address them effectively. We take feedback and insights from our engagement with shareholders and other stakeholders into consideration as we review and evolve our practices and disclosures, and further share them with our board as appropriate. In 2022, we reached out to shareholders to discuss the structure of the Avangrid Governance and Sustainability System, executive compensation, the skills of our directors, and our sustainability achievements. The board carefully considers shareholder feedback.

Communications with the Board

Any shareholder or interested party who wishes to communicate or request a meeting with members of the board or with only non-management directors or any specified individual director may do so by writing to Avangrid’s corporate secretary at the address below. All communications will be reviewed by our legal services division who will, in consultation with our chairman of the board, determine whether the subject matter of the communication deals with the functions of the board or committees thereof or that our legal services division, in consultation with our chairman of the board, otherwise determine should be brought to the attention of the non-management directors, the full board, or one or more of its committees, as well as whether any response to the communication is appropriate. Any such response will be made only in accordance with applicable law and regulations relating to the disclosure of information.

Code of Business Conduct and Ethics

Avangrid has a code of business conduct and ethics that applies to all employees including Avangrid’s principal executive officer, principal financial officer, principal accounting officer, directors, and other senior financial officers. The code is intended to provide guidance to employees, management, and the board to assure compliance with law and promote ethical behavior. Any amendment to the code, or any waivers of its requirements, will be disclosed if required on the company’s website at www.avangrid.com.

		Proxy Statement 2023				Corporate Governance		|     33

Compensation and Nominating Committee Interlocks and Insider Participation

Messrs. Lahey and Sáinz Armada and Ms. Jacobs deliberated on executive compensation matters in their capacity as members of the compensation and nominating committee during 2022. None of these directors is, or has ever been, an officer or employee of Avangrid or any of our subsidiaries. In addition, during the last fiscal year, none of our executive officers served as a member of the board of directors or the compensation committee of any other entity that has one or more executive officers serving on our board.

Review, Approval, or Ratification of Transactions with Related Persons

The board has adopted a written policy for approval of transactions in which Avangrid was, is, or will be a participant and in which its directors, director nominees, executive officers, greater than 5% beneficial owners, and each of their respective immediate family members has or will have a direct or indirect material interest, where the amount involved in the transaction exceeds or is expected to exceed $120,000. A copy of this policy, the related party transaction policy, is available in the Corporate Governance section on the company’s website at www.avangrid.com. The policy provides that the audit committee reviews all transactions subject to the policy (other than transactions between Avangrid and/or one of its subsidiaries, on the one hand, and Iberdrola, S.A. and/or its affiliates, on the other hand, which are subject to review by the unaffiliated committee to ensure that such transactions are entered into on an arms’ length basis pursuant to the Shareholder Agreement) and determines whether or not to approve or ratify those transactions. In addition, the audit committee has delegated authority to the chair of the audit committee to pre-approve or ratify transactions under certain circumstances. The policy prohibits any director from participating in any review, discussion, consideration, or approval of any transaction subject to the policy for which such director or his or her family member is a related party, except that such director is required to provide all material information concerning the interested transaction to the audit committee. In reviewing the transactions subject to the policy, the audit committee, or the chair of the audit committee, as applicable, considers among other factors it deems appropriate:

		Proxy Statement 2023				Corporate Governance		|     34

Certain Relationships and Related Party Transactions

Relationship with Iberdrola, S.A.

Iberdrola, S.A. currently directly holds 81.5% of the outstanding shares of Avangrid common stock. As the company’s controlling shareholder, Iberdrola, S.A. continues to exercise significant influence over Avangrid, including the composition of our board and any action requiring the approval of our shareholders. Transactions with Iberdrola, S.A. relate predominantly to pass-through charges of corporate services/management fees. These corporate services are entered into on an arm’s length basis and are aimed at maximizing our operating efficiency in an efficient and flexible service model. The corporate services are provided at market quality, and subject to audit and dispute resolution procedures.

The Shareholder Agreement

On December 16, 2015, we completed the acquisition of UIL pursuant to a merger agreement. In connection with the transaction, we entered into the Shareholder Agreement on December 16, 2015 with Iberdrola, S.A. The Shareholder Agreement sets forth certain governance arrangements and contains various provisions relating to, among other things, representation on our board, minority protections that limit the disposal or transfer of shares of the company by Iberdrola, S.A., registration rights, preemptive rights, and the requirements for the approval of affiliate transactions and business opportunities, which are described in more detail below.

		Proxy Statement 2023				Corporate Governance		|     36

Any amendments to the Shareholder Agreement requires prior approval of both our board and a majority of the members of the unaffiliated committee. The Shareholder Agreement will remain in effect as long as Iberdrola, S.A. owns more than 20% of the outstanding voting stock of the company. Following any termination of the Shareholder Agreement, Iberdrola, S.A. will have one demand registration right, subject to customary limitations and exceptions, and piggyback registration rights with respect to any registration proposed by the company, subject to customary “cut back” provisions. The laws of the State of New York will govern the Shareholder Agreement as long as we remain a New York corporation. If we are redomiciled to Delaware, the laws of the state of Delaware will govern the Shareholder Agreement.

The Framework Agreement and Declaration of Acceptance

On July 16, 2015, we entered into the Declaration of Acceptance with Iberdrola, S.A. (“2015 declaration of acceptance”), making us a party to the framework agreement for 2015 and detailing the corporate services Iberdrola, S.A. provided to us or to any of our affiliates in 2015. The framework agreement governs the relationship between Iberdrola, S.A. and the various Iberdrola, S.A. entities, with respect to the corporate services Iberdrola, S.A. contracts to provide each relevant entity. Pursuant to the framework agreement, and under the Iberdrola group’s “One Corporation” structure, Iberdrola, S.A. provided efficient and flexible corporate services to us and our subsidiaries. Our entry into the 2015 declaration of acceptance was approved by a committee comprised solely of our independent directors. On July 14, 2016, the unaffiliated committee approved a new declaration of acceptance detailing the corporate services Iberdrola, S.A. provided to us or any of our affiliates (“2016 declaration of acceptance” and together with the 2015 declaration of acceptance, the “declarations of acceptance”).

Pursuant to the declarations of acceptance, Iberdrola, S.A. provides various corporate services to us including, among other services, those relating to the management of buildings and leases, surveillance and maintenance of buildings, international and corporate security, human resources, brand management, procurement, management of the SAP corporate platform, research and development, quality control, insurance, information technology, and general administration. Pursuant to the 2015 declaration of acceptance and in accordance with the merger agreement, the foregoing services and the price thereof were entered into on an arms’ length basis and on financial and other material terms no less favorable to us and our subsidiaries than applicable agreements or arrangements in respect of such corporate or other shared services existing as of February 25, 2015, and did not result in a higher cost to us or our

		Proxy Statement 2023				Corporate Governance		|     37

subsidiaries and affiliates than the aggregate costs for such services reflected in the 2014 IFRS audited consolidated financial statements of Avangrid, except to the extent related to ordinary course market adjustments made on an arm’s length basis or as otherwise approved by the majority of the members of the unaffiliated committee. All new, future services to be provided by Iberdrola, S.A. or its affiliates to us and our subsidiaries must be on an arm’s length basis and approved by the unaffiliated committee.

By entering into the 2016 framework agreement via the 2016 declaration of acceptance, any previous framework agreements between us and Iberdrola, S.A. were terminated by operation of law. The framework agreement covers any services provided by Iberdrola, S.A. as of January 1, 2016, and remains in force as long as we and/or our subsidiaries continue to operate as a subsidiary of Iberdrola, S.A. in accordance with the provisions of Article 42 of the Spanish Commercial Code. As soon as Avangrid or any of our subsidiaries ceases to be a subsidiary of Iberdrola, S.A., the contractual relationship under the framework agreement will be terminated between such Avangrid entity and Iberdrola, S.A. This declaration of acceptance remains in force under the same terms unless any ground for termination of the framework agreement arises.

Under the framework agreement, Iberdrola, S.A. must provide the relevant services pursuant to standard market conditions. Iberdrola, S.A. cannot receive financial or other types of consideration on a more favorable basis than what a third party in a substantially similar circumstance would receive. Iberdrola, S.A. must provide the relevant services in a manner that will not impair our decision-making capacity, while we must provide accurate and complete information to Iberdrola, S.A. to enable Iberdrola, S.A. to effectively provide the relevant services. Iberdrola, S.A. must provide the relevant services with a level of expertise, care, and diligence that a company providing these services on the open market would provide. We assume any liability that may derive from damage or losses attributable to the instructions or information provided to Iberdrola, S.A.; provided that Iberdrola, S.A. will only be liable for non-performance, defective performance, or negligence. Iberdrola, S.A. is also required to notify us before December 31 of each year regarding the estimated price for each service contracted for the following year.

The framework agreement contains provisions relating to confidentiality, requiring each party to safeguard all information received by the other under the framework agreement. The framework agreement is governed by the laws of Spain and contains arbitration provisions for purposes of dispute resolution. The framework agreement cannot be modified or assigned without our prior written consent or the prior written consent of Iberdrola, S.A. We made payments to Iberdrola, S.A. pursuant to the framework agreement in the approximate amount of $28.7 million for the year ended December 31, 2022.

Agreements Related to Liquidity Resources and Guarantee and Support

We manage our overall liquidity position as part of the broader Iberdrola group of companies and, on December 1, 2017, entered into a customer liquidity agreement (the “Customer Liquidity Agreement”) with Bank of America, National

		Proxy Statement 2023				Corporate Governance		|     38

Association (“BOA”), Iberdrola, S.A., Iberdrola Mexico, S.A. de C.V., and Scottish Power Ltd. Under the Customer Liquidity Agreement, the participants, including Avangrid, may deposit funds with or borrow from BOA, provided that the balance of funds deposited less funds borrowed by all participants in the aggregate is not less than zero. Deposits are available for next day withdrawal. Simultaneous with entry into the Customer Liquidity Agreement, Avangrid and Iberdrola, S.A. entered into an indemnification agreement pursuant to which Iberdrola, S.A. has agreed to indemnify Avangrid against all damages, charges, costs, fees, and other expenses that the company or its subsidiaries may incur arising out of the deposits or borrowings by Iberdrola, S.A., or by the subsidiaries or affiliates of Iberdrola, S.A., other than Avangrid or its subsidiaries pursuant to the Customer Liquidity Agreement. Deposit amounts, if any, are reflected in our consolidated balance sheet under cash and cash equivalents. There was no balance under this agreement on December 31, 2022.

On June 18, 2018, Avangrid entered into a credit facility with Iberdrola Financiacion, S.A.U., a member of the Iberdrola group. The facility has a limit of $500 million and matures on June 18, 2023. Avangrid pays a facility fee of 10.5 basis points annually on the facility. Avangrid has not borrowed any amounts under this credit facility.

On October 20, 2020, Avangrid entered into an agreement and plan of merger (the “Merger Agreement”) with PNM Resources, Inc. (“PNMR”), and NM Green Holdings, Inc., a wholly-owned subsidiary of Avangrid (“Merger Sub”), pursuant to which Merger Sub will merge with and into PNMR (the “Merger”), with PNMR surviving the Merger as a direct wholly-owned subsidiary of Avangrid.

In connection with the Merger, Iberdrola provided Avangrid with a commitment letter (“Iberdrola Funding Commitment Letter”), pursuant to which Iberdrola unilaterally agreed to provide to Avangrid, or arrange the provision to Avangrid of, funds to the extent necessary for Avangrid to consummate the Merger, including the payment of the aggregate Merger Consideration. The specific terms of any transaction effecting such funding commitment will be negotiated between Iberdrola and Avangrid on an arm’s length basis and must be approved by both (i) a majority of the members of the unaffiliated committee of the board of directors of Avangrid, and (ii) the entire board of directors of Avangrid.

On April 15, 2021, Avangrid entered into a side letter agreement with Iberdrola, which sets forth the terms and conditions relating to the Iberdrola Funding Commitment Letter (the “Side Letter Agreement”). The Side Letter Agreement provides that any drawing in the form of indebtedness made by the company pursuant to the Funding Commitment Letter shall bear interest at an interest rate equal to 3-month LIBOR plus 0.75% per annum calculated on the basis 360-day year for the actual number of days elapsed and, commencing on the date of the Funding Commitment Letter, we shall pay Iberdrola a facility fee equal to 0.12% per annum on the undrawn portion of the funding commitment set forth in the Funding Commitment Letter. The Side Letter Agreement automatically extended upon the extension of the consummation date for the Merger under the Merger Agreement.

		Proxy Statement 2023				Corporate Governance		|     39

On December 14, 2020, Avangrid entered into an intra-group loan agreement with Iberdrola (the “Intra-Group Loan Agreement”), which provides the company with an unsecured subordinated loan in an aggregate principal amount of $3,000,000,000. The loan bears interest until June 15, 2021, at a rate per annum equal to 0.20%, which shall increase one (1) basis point each month following the first month of the term of the Intra-Group Loan Agreement up to a maximum interest rate of 0.25% per annum, and from June 16, 2021 until the loan and any accrued and unpaid interest is repaid in its entirety, at Avangrid’s equity cost of capital as published by Bloomberg. Interest is payable on a monthly basis in arrears. Avangrid is required to repay the loan in full upon certain equity issuances by Avangrid in which Iberdrola participates or a change of control. In addition, on or after June 15, 2021, upon five business days’ notice to Iberdrola, Avangrid may voluntarily repay the loan and any accrued and unpaid interest, in whole or in part, without prepayment premium or penalty if there is a change in Avangrid’s business plan and Avangrid determines that the loan is no longer required. The Intra-Group Loan Agreement was repaid with proceeds of the Private Placement Shares described below.

On May 12, 2021, Avangrid entered into a share purchase agreement (the “Hyde Purchase Agreement”) with Hyde Member LLC (“Hyde”), a Delaware limited liability company and wholly owned subsidiary of Qatar Investment Authority, to issue and sell to Hyde in a private placement (the “Hyde Private Placement”) approximately $740,000,000 of Avangrid’s common stock (the “Hyde Placement Shares”), at the purchase price of $51.40 per share (which was the closing price of the shares of the Common Stock on the New York Stock Exchange as of May 11, 2021) (the “Purchase Price”). Also on May 12, 2021, Avangrid entered into a share purchase agreement with Iberdrola (the “Iberdrola Purchase Agreement” and, together with the Hyde Purchase Agreement, the “Purchase Agreements”), to issue and sell to Iberdrola in a private placement (the “Iberdrola Private Placement” and, together with the Hyde Private Placement, the “Private Placements”) approximately $3,260,000,000 of Avangrid’s common stock (the “Iberdrola Placement Shares” and, together with the Hyde Placement Shares, the “Private Placement Shares”) at the Purchase Price.

On May 18, 2021, Avangrid closed the sale of the Hyde Placement Shares pursuant to the Hyde Purchase Agreement and the sale of the Iberdrola Placement Shares pursuant to the Iberdrola Purchase Agreement. In connection with the closing, Avangrid issued 14,396,887 shares of common stock to Hyde in consideration for an aggregate purchase price of approximately $740 million and 63,424,125 shares of common stock to Iberdrola in consideration for an aggregate purchase price of approximately $3.26 billion. Three billion dollars ($3.0 billion) of the proceeds were used to repay the intra-group loan under the Intra-Group Loan Agreement described above. After the effect of the private placements, Iberdrola retained its 81.5% ownership interest in Avangrid.

On April 6, 2022, Avangrid entered into a Deposit Agreement with Iberdrola in which Avangrid can make term deposits to Iberdrola between one day and twelve months at a rate agreed upon by both parties. There were no deposits outstanding under the agreement as of December 31, 2022.

		Proxy Statement 2023				Corporate Governance		|     40

Other Agreements with Iberdrola, S.A. or its Affiliates

Avangrid and Iberdrola, S.A. or its affiliates are also parties to the following additional agreements that primarily relate to the provision of additional corporate services and the recharge of expenses related to the employment of personnel from Iberdrola, S.A. or its affiliates by the company:

		Proxy Statement 2023				Executive Compensation		|     42

Executive Compensation

This section describes the compensation program for our named executive officers and includes the required executive compensation tables.

		Proxy Statement 2023				Executive Compensation		|     43

Compensation Discussion and Analysis

As a purpose-driven organization, we believe sustainable growth requires a diverse and inclusive workplace built on individual accountability and commitment to serving others. We are continuing to invest in initiatives that unleash individual potential, value and reward performance, champion well-being, and foster meaningful connections between each other and the communities we serve. The 2022 compensation of our named executive officers (“NEOs”) appropriately reflects and rewards their significant contributions to Avangrid’s strong performance in a year that presented unique and nuanced challenges for our executive team to manage. This Compensation Discussion and Analysis explains the guiding principles and practices upon which our executive compensation program is based, and the compensation paid to our NEOs for their fiscal year 2022 service: