Eksfin provides 525 Million Euro in loan financing to Ørsted based on Norwegian exports to Hornsea 3 offshore wind farm in the UK

Export Finance Norway (Eksfin) is providing loan financing of EUR 525 mn to Ørsted of Denmark, one of the world’s largest offshore wind developers. The financing is based on the purchase of two transformer platforms from Norway’s Aibel for the Hornsea 3 offshore wind farm project in the UK. The transaction increases Eksfin’s total offshore wind financing to nearly EUR 3.5 bn.

Hornsea 3, situated off the Norfolk/South Yorkshire coast, will be the world’s single largest wind farm. It is expected to generate a minimum of 2.9 GW of electricity when in operation in 2027, enough to supply around three million homes with clean energy. It will be Ørsted’s third gigawatt-scale project in the Hornsea zone following Hornsea 1 (1.2 GW) and Hornsea 2 (1.3 GW), which are already in operation.

Promoting Norwegian exports

Building large offshore wind farms is capital intensive. Partnering with banks, Eksfin offers state-backed loans and guarantees directly to developers based on the purchase of equipment and services from Norway. The financing for Ørsted, together with last year’s EUR 45mn financing for Spanish energy companyt Iberdrola, falls into this category.

Our cooperation with leading offshore wind developers is vital for the Norwegian offshore wind cluster. This latest transaction strengthens the relationship between Ørsted and Norwegian exporters and helps create opportunities for future co-operation, said Eksfin Managing Director Tone Lunde Bakker.

Offshore wind is currently the main driver for the Norwegian supply industry’s strong growth in renewables. Norwegian companies specialise in platform construction, cable laying and maritime installations and have secured major export contracts. In 2022, the Norwegian offshore wind industry had an international market share of 7.5 per cent. The Norwegian government’s target for the Norwegian offshore wind industry is a world-wide market share of 10 per cent by 2030.

Eksfin’s guarantees contribute to solving our customers’ financing needs, which is in turn crucial for strengthening our competitiveness in the international offshore wind market, said Aibel CEO Mads Andersen.

Increased focus in the UK

Ørsted currently manages 12 wind farms in the UK, which is one of the world’s most mature offshore wind markets backed by broad political support and the provision of Contracts for Difference (CfDs) that lock in a minimum price for green electricity. Ørsted secured attractive CfDs for Hornsea 3 with a duration of 15 years.

The support by Eksfin and similar institutions plays a very important role in the green energy transition given the capital intensity of the sector. From Ørsted’s side, we are very satisfied with the cooperation with and flexibility shown by Eksfin in relation to the loan financing for our Hornsea 3 offshore wind farm, said Rasmus Errboe, Interim CFO.

The UK government’s ambition is to have 50 GW of offshore wind in operation by 2030 and to be net zero by 2050, requiring a total of between 65 and 125 GW of installed renewable power. This makes it a key market for Norwegian offshore wind suppliers going forward, and by default for Eksfin.