Ørsted is slashing investment and dropping its targets for developing new renewable energy as part of a second drastic attempt to restore its struggling share price and boost confidence in its strategy.
Under its new plans, Ørsted is scrapping its target of developing 35-38GW of renewables by 2030, and is cutting investment plans for 2024-2030 by 25 per cent to DKr210bn-DKr230bn ($29.3bn-$32.10bn).
The state-backed company announced on Wednesday plans to prioritise building existing projects as it tries to recover from a troubled foray in the US.
It also faces a difficult environment for offshore wind with the election of Donald Trump, while attempting to maintain its investment-grade rating and avoid new fundraising to shore up its balance sheet.
The move highlights the challenges facing global attempts to move away from fossil fuels, with some other developers also scaling back their renewables ambitions due to flagging returns or practical challenges.
The announcement came hours after Equinor, Norway’s state-owned energy group and a major Ørsted shareholder, said it was also cutting renewables targets and instead planned to pump more oil to boost shareholder returns and cash flow.
Analysts at RBC said: “It is a positive step, given the funding challenges for the business and the lack of credit given for growth by the market.”