Orsted has unveiled a new strategic vision for the company that includes an ambition to hit 15GW of installed offshore wind capacity by 2025, up from the previous target of 12GW.
The Danish energy giant said it expects to reach more than 30GW of operational projects across its renewables portfolio, including onshore wind, “towards 2030”, up from around 10GW due online in 2020, and will invest Dkr200bn by 2025.
Offshore wind will account for between 75% and 85% of the investment, onshore wind 15% to 20% and the remainder covering bioenergy and customer solutions.
Orsted said as a result of the investment it expects operating income growth from offshore and onshore wind of 20% a year reaching Dkr25-26bn in 2023.
The multiple for the capital investments in the Borssele 1&2, Hornsea 2, Gode Wind 3&4 and German Cluster 1 offshore projects is expected to be on average Dkr13.5m per MW excluding transmission assets and based on 2019 prices.
Return on capital employed for 2019-2025 is expected to be about 10%, which is less than earlier estimates.
Orsted said the reduction is the “result of earnings from the partial divestment of Hornsea 1 in 2018 being outside this period and of the acquisitions of Lincoln Clean Energy and Deepwater Wind, which increase the capital expenditure in these years and contribute to the earnings with a time lag”.
Overall, the strategic plan is expected to increase the share of green energy in the company’s generation mix to 99% by 2025 from 64% in 2017.
Chief executive Henrik Poulsen, who mapped the targets ahead of the company’s Capital Markets Day in Copenhagen today, said new goals will be reached “provided the build-out creates value for our shareholders”.
“We have a strong growth platform to support our strategic ambition. We want to maintain our position as global market leader in offshore wind and continue our build-out in Europe, North America and Asia,” he said.
“Our second growth platform is our onshore business, consisting of onshore wind, solar energy and energy storage. It’s our ambition to create a leading North American company within renewable energy.”
He added: “In addition, we’ll continue to explore the growth and value creation potential in our Bioenergy business and strengthen the route to market for our product portfolio in Customer Solutions.”