Lessons Learned From an Energy Company's Green Transformation
by Columbia Center on Sustainable Investment | April 12, 2019

Ørsted’s Burbo Bank offshore wind farm, off the northeastern coast of the U.K. Photo: Ørsted

Ørsted, formerly Danish Oil and Natural Gas Energy, is one of few energy companies to transition primarily to renewable energy from fossil fuels. The largest power producer in Denmark, Ørsted sold its upstream oil and gas business in 2017, reduced coal use by 81 percent between 2006 and 2018, and is the planet’s leading offshore windfarm developer. The company also has an ambitious science-based climate target that is aligned with the Paris Climate Agreement and foresees that 99 percent of its power and heat generation will come from renewables by 2025.

Nicolas Maennling from the Columbia Center on Sustainable Investment had the pleasure to talk with Jakob Askou Bøss, head of strategy and communication at Ørsted, about lessons learned from Ørsted’s transition, and their implications for other energy companies hoping to succeed in a decarbonized economy.

When did Ørsted decide to become a renewable energy company? What convinced the board to approve the change?

The company decided to transform in 2008. Climate change was on the agenda, and the EU had adopted targets to build renewables. We believed that, to succeed in the long-term, the company would need to change its energy generation mix from fossil fuels to renewables. Initially, it was a vision of where the company wanted to be in the long-term and, when the vision was formulated, it did not entail shutting down specific coal-fired power plants or building new wind farms. It was a vision with a 30-year horizon, which is roughly the lifetime of our assets. This vision meant that we would start investing more in “green” and stop investing in “black” power and heat production. At the time, we thought that this transformation would take 30 years, thereby allowing our “black” assets to retire on schedule while installing renewables to meet new demand.

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