Ørsted posts bumper earnings, eyes hydrogen investments, PPAs

Walney offshore wind farm

Ørsted earnings for 2019 “exceeded expectations” with operating profit up 17 per cent to DKK17.5bn (£1.99bn) on a like for like basis.

The firm said a windy December provided an end of year boost.

While divestments made during 2019 will impact earnings next year, CEO Henrik Poulsen suggested 2020 will also deliver strong growth as the company continues to build out wind farms around the world.

Ørsted said 86 per cent of its heat and power generation activities are now “green”, up from 75 per cent last year. The company is targeting carbon neutrality in its own operations by 2025.

PPAs: gradual progress

The firm’s annual report cites the 100GWh direct PPA deal signed with Northumbrian Water last year as a landmark agreement.

However, while the volume of corporate PPA deals globally is increasing, Poulsen said the market remains nascent.

“We are still in market looking for corporate PPAs,” said Poulsen, with Ørsted hunting “meaningful opportunity”.

However, “there is still a lot of work to be done in terms of having supply and demand meet up,” with “education” required on both sides of the deal.

“We expect 2020 to increase on last year, but I’m not sure I would expect to see an explosion [in deals],” said Poulsen.


Ørsted is starting to actively explore hydrogen, setting up a dedicated hydrogen team and  commencing a small-scale trial to produce hydrogen via electrolysis in Copenhagen.

The scheme, powered by near two near shore wind turbines, will produce hydrogen for use in buses around the Danish capital, and potentially trucks. “Based on that experience, we may later on start to scale up the project,” said Poulsen.

He said Ørsted will invest in electrolysis facilities “if we can find investment cases that stack up”.

“From there on, some of the green hydrogen needs to be further refined into methanol or ammonia – which will take further investment. We are considering whether to integrate into that part of the value chain,” said Poulsen.

“We need to further understand the commercial and technical [aspects] and see if we can find further investment opportunities. If we can, we will certainly invest.”

Sweden’s Vattenfall is also investing in hydrogen production and the broader supply chain.

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