Ørsted divests stakes in key U.S. renewable energy projects to fuel growth

Ørsted, a global leader in renewable energy, has announced a pivotal transaction with Energy Capital Partners (ECP), further cementing its strategy to scale its U.S. operations. The Danish company has sold a 50% equity stake in three significant renewable energy projects to ECP, a prominent investor specializing in energy transition assets. This farm-down aligns with Ørsted’s long-term vision of accelerating clean energy deployment across key U.S. markets while leveraging strategic partnerships to maximize financial returns.

What Renewable Energy Projects Are Involved?

The divestment includes three major onshore renewable energy developments:

Mockingbird Solar, a 468 MW solar farm in Texas

Sparta Solar, a 250 MW solar farm also located in Texas

Eleven Mile Solar Center, a dual-purpose project in Arizona that combines 300 MW of solar capacity with a 300 MW/1,200 MWh battery storage system

All three projects began operations in 2024, featuring robust tax equity partnerships and secured long-term power purchase agreements (PPAs), ensuring stable revenue streams for stakeholders.

Why is This Farm-Down Strategy Significant?

Ørsted’s decision to divest a portion of its stake is part of its broader farm-down program, a strategic approach where the company sells partial ownership of operational assets to reinvest in new renewable energy projects. The $572 million transaction with ECP underscores this intent. Including earlier tax equity funding and a tax credit transfer agreement, Ørsted has raised over $1.3 billion for these projects, further solidifying its position in the U.S. renewable energy market.

James Giamarino, Head of Commercial in Region Americas at Ørsted, described the transaction as a testament to the company’s ability to collaborate with diverse financial and operational partners. According to Giamarino, the partnership with ECP not only supports Ørsted’s current portfolio but also paves the way for future renewable energy projects.

How Will Ørsted Use the Proceeds?

The proceeds from the divestment will be recycled into Ørsted’s U.S. operations, enabling the development of additional wind, solar, and battery projects. By reinvesting capital, the company aims to address growing electricity demand in high-load markets such as Texas and Arizona, where renewable energy plays an increasingly vital role in meeting grid stability requirements.

The Role of Energy Capital Partners

ECP’s involvement highlights its commitment to advancing large-scale clean energy infrastructure in the U.S. With a proven track record in managing renewable assets, ECP will collaborate with Ørsted to ensure operational excellence for the three projects. Matt Himler, Principal at ECP, noted that the projects align with the nation’s renewable energy goals, providing critical infrastructure to reduce carbon emissions and support energy transition efforts.

Ørsted’s Expanding U.S. Footprint

With the addition of Mockingbird Solar, Sparta Solar, and Eleven Mile Solar Center, Ørsted now boasts a diversified U.S. portfolio exceeding 6 GW of wind, solar, and battery storage projects in operation or under construction. This latest milestone builds on Ørsted’s prior partnership with ECP, which included a 2022 farm-down of three wind farms and one solar farm.

Cody Castaneda, Ørsted’s Head of Partnerships & M&A Americas, emphasized that the collaboration with ECP underscores the value of Ørsted’s diversified renewable portfolio. Castaneda noted that such partnerships are instrumental in scaling renewable energy infrastructure, which is essential for meeting long-term energy transition goals.

The Future of Renewable Energy in the U.S.

Ørsted’s successful execution of its farm-down strategy reflects a broader trend in the renewable energy sector, where financial and operational partnerships drive growth and innovation. As Ørsted reinvests in new projects, its commitment to advancing the clean energy transition remains clear.

Through collaborative efforts with industry leaders like ECP, Ørsted continues to address critical energy challenges while delivering sustainable, long-term value for investors and communities alike.