At Domini, we conduct proprietary in-house research to evaluate the environmental and social performance of our investments. Our in-depth ESG research and our standards help create value not only for portfolios but for people and planet too. During our research process, we uncover many innovative initiatives worth sharing.
Renewable energy, often referred to as clean energy, comes from natural renewable sources like the sun, wind, and ocean tides, which are mostly inexhaustible. Moving away from fossil fuels and shifting to renewable energy is essential in reducing greenhouse gas emissions and helping mitigate the mounting effects of climate change. As impact investors, we pay particular attention to companies striving to find new renewable energy solutions.
Headquartered in Denmark, Ørsted SA is an innovative utility company. Founded in 1972, Ørsted was the first company to transition to clean energy from fossil fuels. Today, they operate more offshore wind energy projects than any other company in the world. With diverse clean energy activities, including offshore wind, onshore wind, and bioenergy, to name a few, Orsted is dedicated to transforming the global energy landscape. In addition, the company is very diverse. In 2023, its ten-member executive team was comprised of 30% women, and 41% of all new hires were women.
Renewable Energy Capacity and Achievements
Ørsted’s offshore segment is a cornerstone in its renewable energy strategy, with various global projects in countries like the U.K, Germany, Denmark, Poland, Taiwan, and the U.S. As of 2023, the company advanced offshore wind capacity in the U.S. to a total of 19.2 GW, a substantial increase from previous years. The onshore segment, though smaller, plays a vital role with a 4.5 GW installed capacity in the U.S., the UK, and Taiwan.
Sustainability and Green House Gas Emissions Reduction
In 2023, Ørsted made significant strides in its sustainability journey. The company’s installed renewable capacity grew by 4% to reach 15.7 GW, with 93% of its heat and power generation coming from green sources. This achievement is a testament to Ørsted’s commitment to carbon neutrality by 2025. The company also made substantial progress in reducing emissions, with a 94% decrease in greenhouse gas emissions (GHGs) intensity across Scope 1, 2, and 3 emissions and a remarkable 49% reduction in Scope 3 emissions compared to 2022.
Innovation in Recycling and Lifecycle Management
In 2023, Ørsted demonstrated its commitment to innovative sustainability practices by partnering with Plaswire to recycle onshore wind turbine blades into polymer bricks for construction. This initiative contributed to the company successfully diverting its waste from landfills in 2023, with 100% of its turbines being turned into new products.
Navigating challenges
Authorities ordered the company to continue operating coal-fired power stations. Still, it is unwaveringly dedicated to sustainable practices, such as using significant amounts of biomass in its thermal energy capacity.
Overall, Ørsted showcases strong leadership in the utility sector, aligning closely with Domini’s goal of ecological sustainability and affordable, environmentally sustainable electricity generation. While the clean utility firm continues to navigate challenges in its thermal power generation, its unwavering commitment to expanding renewable energy capacity, reducing GHG emissions, and fostering sustainable practices positions it as a key player in the global transition to a greener future. Through transparent ESG reporting, Ørsted continues to showcase that there is a clear pathway towards a sustainable and resilient energy system.