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Ørsted presents Greater Changhua funding plans

By: Tom Russell 07/03/2018 Ørsted

General Windfarms

Marianne Wiinholt, Chief Financial Officer of Ørsted, today met the top Taiwanese financial executives at the “Ørsted Financing Symposium Taiwan”. The purpose was to share Ørsted’s financing strategy for the Greater Changhua Projects in Taiwan, and to present Ørsted’s unique partnership model.

Ørsted’s four offshore wind projects located off Changhua County in Taiwan were amongst the successful applicants the Taiwanese Environmental Protection Administration approved in a recent review. With the EIA approvals, Ørsted has secured exclusivity over the development of these four sites. The total capacity of the four wind farms, which will be located between 35 and 60km from shore, is expected to be 2.4GW.

Ørsted explained that it will use its financial position to finance the Greater Changhua projects directly on the balance sheet by obtaining substantial local NTD debt from local banks and institutions, and use the partnership model to further enhance the opportunities for Taiwanese financial and institutional investors to become long-term partners with Ørsted in the projects.

Marianne Wiinholt said: “We are very committed to the Taiwanese offshore wind market and are interested in engaging in long-term partnerships with local companies. With 50.1% shares owned by the Kingdom of Denmark, Ørsted’s corporate balance sheet and Investment Grade credit rating of BBB+/Baa1 demonstrate that we have the financial capabilities necessary to successfully develop, construct, operate and own world-class wind farms in Taiwan.”

Matthias Bausenwein, Ørsted’s General Manager for Asia Pacific, said: “The Greater Changhua projects have a maximum capacity of 2.4GW to be built out from 2021 to 2025. Undertaking such large-scale offshore construction projects requires huge experience, a comprehensive set of technical skills and strong financial capabilities. If successful in the grid allocation, our four Greater Changhua projects require total investments of approximately NTD 380 billion – 6 times the construction cost for Taipei 101 building and close to the total construction costs of the Taiwan High Speed Rail . A substantial part of that amount will be direct investments in developing a local supply chain to support the development, construction and operations of our Greater Changhua projects benefitting the local communities for many years to come.”

With the capital structure and financial position of the company, Ørsted stated it is well positioned to finance projects from funds available through the corporate balance sheet. Marianne Wiinholt said the company will fund the Greater Changhua projects by capital provided by the Ørsted Group combined with debt capital sourced from local Taiwanese banks and financial institutions - backed by a Ørsted A/S parent company guarantee. This structure has been well-received by leading local and international banks in Taiwan.

Matthias Bausenwein said that Ørsted is seeking to share the experience of offshore wind financing with Taiwan's financial community, and is interested in seeking partners such as institutional investors and financial institutions to establish long-term partnerships for the "Greater Changhua projects".

Ørsted’s vision is a world that runs entirely on green energy.The company stated that issuing green bonds is a natural step in its green transition as one of the world’s largest green energy companies. In 2017, Ørsted invested a total of NTD 85 billion in renewable projects. With green bonds, a wider group of investors were invited to join the green transformation.

Ørsted intends to engage in the development of a green NTD-denominated corporate bond market in Taiwan. Leveraging its experience as a corporate bond issuer and from its existing Green Bond Framework, Ørsted has been in dialogue with the Taiwanese banks, the Taipei Exchange and the financial authorities on this matter. It hopes to build a strong NTD denominated corporate green bond market for diversifying Ørsted’s NTD-funding base and for the benefit of the Taiwanese offshore wind industry where significant funding is needed to realise the ambitious offshore wind build-out plan.

In Taiwan, Ørsted has taken a project financing approach to invest in Taiwan's first offshore wind farm - Formosa I. With 35% share ownership, Ørsted also provides project consultancy services to ensure that the Phase 1 Formosa 1 project can be delivered smoothly on schedule.

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Ørsted presents Greater Changhua funding plans

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