Danish power company Ørsted announced today that it has completed the acquisition of US onshore wind farm developer Lincoln Clean Energy (LCE) for a total of $580 million.
The move is in keeping with the power firm’s attempts to shift away from fossil fuels and embrace renewable energy sources. Chief Executive Henrik Poulsen said: “The purchase is consistent with our strategic priority to pursue growth opportunities in other green energy technologies outside of our core business of offshore wind.”
He added that it would enable the company to tap into the substantial growth potential that a transition to green energy offers, as well as create additional value for its shareholders.
Poulsen said the acquisition of LCE would provide a ‘strong growth platform’ in the US, an area identified by the company as a key market in the emerging onshore industry alongside Taiwan, in which Ørsted won the right to develop two projects with a combined capacity of 1820MW.
Ørsted entered the US renewables market in 2015. The firm currently holds the rights to develop Bay State Wind and Ocean Wind, which have a potential offshore wind capacity of 4GW. In addition, Ørsted has announced plans to construct two wind turbines in Virginia, each with a capacity of 6MW. The company has invested in battery storage and solar development projects in Austin, Texas to help lead these schemes.
The Danish company has also commissioned a windfarm in the Irish Sea. Once operational, it will be the world’s largest windfarm in operation, expected to provide more than half a million UK homes with green power.
The company announced plans to invest in energy storage, solar projects and onshore wind in February. It was previously involved in onshore wind but sold the business in 2013 due to financial difficulties.
In its interim report for 2018, Ørsted said the share of renewable energy in its energy mix increased from 59% to 71%, while green share production was up to 80%. It said this was driven by the conversion of its power plants to biomass, and the continued expansion of its offshore wind business.
Poulsen also told journalists Ørsted was likely to sell 50% of offshore windfarm Hornsea 1, located in the British part of the North Sea. The transaction is expected to be completed in the second half of 2018 and EBITDA, including new partnerships, is expected to be significantly higher than the DKK 22.5 billion achieved in 2017.
Founded in 2009, LCE has to date developed more than 1.8GW of renewable power projects in California, New Jersey and Texas, and in 2017 was found to be the largest non-utility wind developer in the US. The company has a portfolio of 513MW recently commissioned wind and solar assets, and 300MW wind assets under construction.