Orsted's Q3 offshore wind output up 14% on year as new projects ramp up

London — Orsted's third-quarter offshore wind generation increased 14% year on year as new turbines at Hornsea 1 and Borssele 1 and 2 ramped up, boosting installed capacity by 22% to 6.8 GW, the Danish energy company said Oct. 28 in a results statement.

Wind speeds came to a portfolio average of 8.2 meters per second for the quarter, down 3% year on year, but the year-to-date average remains 5% higher year on year.

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Wind farm availability of 94% was just above Q3 2019.

Of a total 3.2 TWh generated during the quarter, 2 TWh came from UK wind farms, including the world's biggest, Hornsea 1.

Revenue from offshore wind farms in operation increased 15% to DKK4.2 billion ($650 million), but EBIT for the core unit fell 51% to DKK0.9 billion, it said.

Group EBITDA guidance for 2020 was unchanged from August at DKK16 bilion-17 billion with an estimated DKK0.1 billion direct impact from COVID-19.

"Despite the tenacious COVID-19 pandemic, our operations and financial performance in Q3 remain stable and fully in line with our expectations from the beginning of the year," outgoing CEO Henrik Poulsen said, with Orsted appointing Mads Nipper as new CEO during the quarter.

The company highlighted adverse coronavirus-related impacts, especially on the UK power market. It also flagged its currency hedging mostly relating to UK activities, reducing its exposure to sterling for the coming five years from DKK61 billion (GBP7.3 billion) to DKK20 billion, it said.

UK power prices for the first three quarters declined 27% year on year to GBP32.7/MWh, it said, adding that low power demand led to negative prices in July, lower expected ROC recycle prices, and higher balancing tariffs (BSUoS) from National Grid in the third quarter. UK power prices recovered in the third quarter, averaging only 3% lower at GBP38.1/MWh.

25-30 GW offshore wind tenders over next 15 months

A busy tender schedule over the next 15 months underlines Orsted's growing geographical footprint, with 25-30 GW of offshore wind projects to be awarded in the US, UK, Japan, Taiwan, the Netherlands, Germany, France and Denmark, it said.

All 94 turbines at its 752 MW Borssele 1, 2 project in Dutch waters were installed by the end of September, with 70 turbines having passed the 240-hour test, it said.

Construction for the 1.4 GW Hornsea 2 project in UK waters was on track for a H1 2022 start, it said, with the first six of 165 offshore foundations installed.

The development consent order for Hornsea 3 was now expected by the end of 2020.

Orsted has been awarded a further 4 GW of projects already financed, with another 5 GW awarded awaiting FID.

In Europe, national offshore targets were firmed, with the UK targeting 40 GW by 2030 and Germany 40 GW by 2040.

Outside of Europe, Orsted submitted bids in the auction of up to 2.5 GW in New York, with auction results expected before year-end, it said.

Orsted also launched a green hydrogen project with fertilizer company Yara that includes plans for a 100 MW electrolyser at Yara's Sluiskill plant in the Netherlands to produce green ammonia, abating 0.1 million tonnes of CO2/year, it said with Orsted involved in similar projects in the UK, Germany and Denmark.