ORSTED TO INVEST $305 MILLION IN GREEN ENERGY TOWARDS 2025

December 03, 2018

In connection with the company’s Capital Markets Day, Ørsted’s Board of Directors approved the group’s new strategic ambition and financial targets.
CEO and President Henrik Poulsen said:
“We expect the global market for renewable energy to more than triple towards 2030. As one of the leading companies within renewable energy, Ørsted has a strong platform to take part in this build-out.
Today, our portfolio consists of 11.9GW of offshore and onshore wind farms and biomass-fired combined heat and power plants that are either in production, under construction or have been given final investment decision (FID). We also have projects with a capacity of 4.7GW for which we’ve been awarded the concessions to construct, but are yet to make the FID. In addition, we have a strong pipeline of projects under development. Towards 2030, it’s our strategic ambition to reach an installed capacity of more than 30GW, provided that the build-out creates value for our shareholders. As an important step, we’re raising our 2025 ambition for offshore wind from 11-12GW to 15GW.”

Summary
• Gross investments: Around DKK 200 billion from 2019-2025
• Investment allocation:
• Offshore 75-85%
• Onshore 15-20%
• Bioenergy and Customer Solutions 0-5% in total
• Operating income growth from offshore and onshore wind farms: Annual average growth of 20% in the years 2017-2023, corresponding to an EBITDA of DKK 25-26 billion in 2023
• Multiple for the capital investments at 13.5 DKKm/MW, excluding transmission assets, in Borssele 1&2, Hornsea 2, Gode Wind 3&4 and German Cluster 1 (average weighted capacity, real 2019 prices)
• Unlevered lifecycle IRR of 7.5-8.5%, average weighted capacity, for offshore wind projects won in competitive tenders since 2015 (Borssele 1&2, Hornsea 2, Gode Wind 3&4, German Cluster 1, Greater Changhua 1&2a and 2b&4 and Revolution Wind)
• ROCE: 10%, average 2019-2025
• Dividend policy until 2025: Annual dividend increased with high single-digit
• Share of regulated or contract-based operating income (EBITDA): 90%, average in 2019-2025.

(Source: Orsted)