Orsted to invest $57 billion to become leader in green energy
COPENHAGEN, June 3, 2021 – Danish offshore wind farm developer Orsted has announced a USD 57-billion investment plan to become the global leader in green energy by 2027.
The company made the announcement on Wednesday at the Capital Markets Day 2021 event.
After selling its oil and gas business in 2017, Orsted aims to be carbon neutral by 2025 and has a target of completely neutral carbon footprint by 2040.
The company currently ranks at the top of the Corporate Knights 2021 global index of the most sustainable corporations and is recognised on the CDP Climate Change A List as a global leader on climate action.
The move comes at a critical junction where competition in the offshore wind market is ramping up. For example, Spanish company Iberdrola, Europe’s biggest wind power generator, has committed USD 182 billion by 2030 to triple its renewables capacity and double its network assets, and oil majors such as BP, Shell and TotalEnergies are shifting towards an increasing role in renewable energies.
Facing this scenario, Orsted has upped its previous planned investment of 200 billion crowns by 2025 to 350 billion crowns (USD 57 billion) by 2027. The goal is to quadruple its installed renewable energy capacity to 50 GW, from a previous 30-GW target, and speed up the expansion in onshore wind and green hydrogen.
“Our aspiration is to become the world’s leading green energy major by 2030,” Mads Nipper, Orsted CEO, said at Capital Markets Day. According to him, Orsted will move into more renewable energy areas as customers increase their demand for integrated green energy solutions. This goal will be tested throughout the decade as profitability will be challenged in a growing market where competition will intensify.
In this scenario, green hydrogen – hydrogen produced with renewable energy – is increasingly becoming an attractive renewable energy source and investment given its ability to decarbonise energy-intensive sectors such as aviation, shipping and long-haul trucking and heavy industries such as mining and steel.