Taiwan-based Cathay Life Insurance will acquire 50% of Orsted’s 583MW Greater Changhua 4 Offshore Wind Farm through its affiliate Cathay Wind Power Holdings.
The Greater Changhua 4 site is part of Orsted’s 920MW offshore wind farms Greater Changhua 2b and 4, which the Danish developer is currently constructing and expect to finalise by the end of 2025.
The total sales price for the Greater Changhua 4 Offshore Wind Farm comprises the acquisition of a 50% ownership share and the commitment from the partners to fund 50% of the payments under the EPC contract for the wind farm.
The total value of the transaction is approximately DKK11.6bn (€1.55bn), which is to be paid in 2024 and 2025.
All regulatory approvals have been obtained, and the closing of the transaction is expected before the end of the year, Orsted said.
As part of the agreement, Orsted will construct the Greater Changhua 4 Offshore Wind Farm under a full-scope EPC contract.
Orsted will also provide long-term operations and maintenance (O&M) services from its O&M hub at the Port of Taichung.
Rasmus Errboe, deputy chief executive and chief commercial officer at Orsted, said: “We’re pleased to apply our partnership model in Asia Pacific once again and advance the development of offshore wind in the region with Cathay, with whom we have great collaboration experience.
“We’re satisfied with the transaction as it represents another important milestone in our partnership and divestment programme and ensures further progress towards our mid- and long-term targets.”
Cathay Life Insurance is a subsidiary of Cathay Financial Holdings, who is also an investor in Orsted’s Greater Changhua 1 Offshore Wind Farm, through its Cathay Private Equity affiliate.
Andrew Liu, president of Cathay Life Insurance, added: “We’re delighted to partner with Orsted on the development of the Greater Changhua 4 Offshore Wind Farm project.
“This investment underscores our dedication to supporting the government’s renewable energy transition while simultaneously generating stable, long-term returns that align with the investment goals of the insurance sector.”
The financing package, which was structured and led by Orsted, will be supported by guarantees from six export credit agencies (ECAs).
These are Credendo, the Export and Investment Fund of Denmark (EIFO), Export Finance Australia (EFA), Korea Trade Insurance Corporation (KSURE), National Credit Guarantee Administration (NCGA), and UK Export Finance (UKEF).
This is the first time that the government-run NCGA has guaranteed offshore wind financing.
Greater Changhua 4 is currently under construction alongside Greater Changhua 2b, where Orsted has full ownership.
The total 920MW capacity of Greater Changhua 2b and 4 is covered by a 20-year fixed-price corporate power purchase agreement with the Taiwan-based semiconductor company TSMC.
The Greater Changhua 2b and 4 offshore wind farms are located next to the 900MW Greater Changhua 1 and 2a, which are in full operation.