Ørsted Shares Plummet 16% Amid Woes in U.S. Offshore Wind Projects
Ørsted shares have plummeted 16% as the company has announced a substantial impairment charge due to challenges in its U.S. offshore wind projects. Rising financing costs, devalued seabed leases, and execution hurdles, particularly at the Sunrise Wind project, have contributed to the loss. The company cited a congested construction schedule and escalating costs for critical components at Sunrise Wind as major factors behind the impairment, which totals DKK 12.1 billion.
The impairments have raised concerns over Ørsted’s U.S. offshore wind ambitions and the growing pressures in the sector. Sunrise Wind, which is the first U.S. offshore wind farm to utilize an HVDC system, has been delayed and commissioning is now expected in the second half of 2027. The company attributed the project’s delay to supply chain constraints, increased costs, and construction and offshore installation work challenges.
Ørsted also cited market uncertainties, lower valuations for offshore wind sites, and reassessments of their long-term strategic value, resulting in an impairment of DKK 3.5 billion for seabed leases off the coasts of New Jersey, Maryland, and Delaware. Meanwhile, a rise in U.S. long-term interest rates added to the woes, leading to a DKK 4.3 billion impairment across its U.S. offshore wind projects.