Ørsted Issues Inaugural €100 Million Blue Bonds to Finance Biodiversity, Sustainable Shipping Projects
Energy provider Ørsted announced today its first-ever blue bonds offering, raising €100 million with proceeds aimed at financing the company’s ocean biodiversity and sustainable shipping initiatives.
According to the company, the blue bond offering, the first by an energy company, comes amidst a “substantial funding gap for sustainable ocean action,” with only 1% of the ocean economy’s value invested in sustainable projects over the past decade.
In a statement announcing the offering, Ørsted said:
“As pioneers in the industry, we believe the moment is right to introduce blue bonds. Our ambition is that our blue bonds will seed momentum to attract more investment and unlock the potential of a sustainable blue economy.”
Ørsted outlined the planned use of proceeds from the offering, including scaling up its efforts on marine biodiversity, and supporting the transition to sustainable shipping.
Ørsted is looking to significantly ramp its offshore wind capacity over the next several years. In June 2021, Ørsted announced a target to grow its renewable energy capacity to 50 GW by 2030 and stated that it expects roughly 30 GW to come from offshore wind. The company is currently involved in several major offshore wind development programs, including a recently awarded contract for the world’s single biggest offshore wind farm, UK’s Hornsea 3.
Offshore wind deployments can often result in harmful impacts to ocean biodiversity, however, including habitat loss, collision mortality, and noise, among other effects.
Ørsted has committed by 2030, all of its new projects commissioned must have a net-positive biodiversity impact, and the company’s initiatives to achieve this goal include piloting techniques such as artificial habitat restoration, which it said was one of the motivations for launching the blue bonds.
The company also aims to allocate proceeds to its sustainable shipping initiatives, including the development of green ocean fuels and to decarbonize ocean vessels. In December 2022, for example, the company announced plans to proceed with the FlagshipONE e-methanol project, and acquiring full ownership of the project, aimed at producing 50,000 tonnes of e-methanol per year, produced using renewable electricity and captured biogenic carbon dioxide, to help decarbonize shipping.
Daniel Lerup, Chief Financial Officer at Ørsted, said:
“As pioneers in the industry, we believe the moment is right to introduce blue bonds, which are in a similar position to where green bonds were 10 years ago. We’re seeing strong interest from investors who recognise the chance to align their investment strategies with sustainability objectives, diversify their portfolios, tap into growth sectors, and make a positive impact.”