Global Offshore Wind Leader Ørsted to Cut Investment by 25 Percent - 2025

Wind Energy / Economics

AAPG's Nie reported in February 2025 that the world leader in offshore wind, Ørsted, announced plans to cut its investment in the sector by 25 percent until 2030. The cuts reflect challenges facing the offshore wind industry—especially following Trump’s re-election.

                                                                                                         Nuttawutt Uttamaharad/ Shutterstock.com

Ørsted’s decision:

Ørsted will cut its capital program by 25 percent from 2025–2030 by 25 percent to DKr 210–230 billion ($29.3–32.1 billion), according to the Financial Times. The move will scrap Ørsted's previous target of developing 35–38 gigawatts of renewable energy by 2030, already down from the target of 50 gigawatts set prior. Ørsted will focus on finishing construction for several ongoing offshore wind projects totaling 8.4 gigawatts of capacity. Ørsted said that it would increase its installed wind capacity from 18 gigawatts to more than 27 gigawatts by 2027. The company also announced plans to “restore” dividends in 2026.

Ørsted’s previous rise:

Ørsted was once considered a successful example of transforming a traditional oil and gas company (DONG Energy) into a renewable energy company (Ørsted). It assumed its new name in 2017 and is traded on the Oslo Stock Exchange. Ørsted’s share price reached a high of 1,250 Danish Krone ($175) per share in January 2021, with a market cap of $74 billion.

Current struggles:

Over the past four years, Ørsted’s share price dropped 76 percent. Its market cap is now at $18 billion. On 1 February 2025, Ørsted appointed a new CEO, Rasmus Errboe, who replaced Mads Nipper as leader of the struggling company. In February 2024, Ørsted announced a pause for dividends that will extend until at least the end of 2025. It also announced job cuts. In February 2024, Ørsted decided to exit three offshore wind markets in Norway, Spain, and Portugal.

New CEO Errboe said that Ørsted continues to believe in the long-term future of offshore wind and renewable energy.
What they’re saying:

“The renewable energy market has fundamentally changed since January 2021. The impacts on our business of the increasingly challenging situation in the offshore wind industry, ranging from supply chain bottlenecks, interest rate increase, to a changing regulatory landscape, mean that our focus has shifted”—Lene Skole, Ørsted Board Chairman

“We’ll reduce our investment program toward 2030 through a stricter, more value-focused approach to capital allocation”—Errboe.

What to watch:

Shell also said that it would quit the Atlantic Shores offshore wind project near New Jersey and wrote down $996 million in its Q4 2024 results.

What might other companies do with their offshore investment projects?