Orsted plans $ 57 billion to become No.1 in green energy

By Tim Barsoe and Stine Jacobsen

COPENHAGEN (Reuters) -Orsted, the world’s largest developer of offshore wind farms, increases investment in renewable energy to $ 57 billion by 2027, seeking to become a global leader in green energy and push back the growing competition.

The Danish company, which sold its oil and gas business in 2017, has benefited enormously from the policies implementing the 2015 Paris Agreement, a collective attempt to limit global warming.

But competition is intensifying as utilities and energy companies, including oil majors such as Total, BP and Shell, ramp up spending on renewables.

Europe’s largest wind power producer, Iberdrola, pledged earlier this year to spend 150 billion euros ($ 182 billion) by 2030 to triple its renewable capacity and double its grid assets .

Orsted, which has installed more than a quarter of the world’s offshore wind capacity, on Wednesday announced plans to invest DKK 350 billion ($ 57 billion) by 2027, against a previous target of DKK 200 billion. by 2025.

“Our aspiration is to become the world leader in green energy by 2030,” Managing Director Mads Nipper, who joined Orsted in January, told investors at a Capital Markets Day.

The company aims to more than quadruple its installed renewable energy capacity over the next decade to 50 gigawatts (GW), compared to its previous target of 30 GW, and to step up expansion in areas such as wind terrestrial and green hydrogen.

“The question is whether Orsted can maintain profitability when the market is growing and competition intensifies,” said Nordnet analyst Per Hansen.

At 12:40 GMT, Orsted stock was down 4.8% to 881.6 Kroner, with Citi analysts saying the stock already reflected strong growth despite increasing competition.

Orsted is moving towards more renewable energy areas as customers increasingly demand integrated green energy solutions with, for example, both solar and wind, Nipper said.

It aims to become a world leader in green hydrogen – or hydrogen produced using renewable energies – which is considered crucial to replace fossil fuels in hard-to-decarbonize sectors such as shipping, aviation. and heavy industries like mining.

($ 1 = 6.1011 Danish kroner)

(Reporting by Tim Barsoe and Stine Jacobsen, editing by David Goodman and Mark Potter)

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