Denmark-based Orsted is reducing its global activities in offshore wind. It is exiting the Norway, Spain, and Portugal markets, and also reducing its focus on Japan. The firm’s divestment programme will also be accelerated.

Last year Orsted announced it had ceased the development of US offshore wind projects Ocean Wind 1 and Ocean Wind 2 in the form that they were awarded by the New Jersey Board of Public Utilities.

The company will primarily focus its US offshore portfolio towards the North-East Atlantic.

Project cancellations and phasing of capital expenditure across the portfolio will result in around €4.7 billion (US$5 billion) of capital expenditure relief in 2024-2026, according to Orsted.

Impairments of over US$5 billion were already announced in 2023, resulting from project cancellations and cost overruns.

On February 7 Standard & Poor's downgraded Orsted from BBB+ to BBB.

Citing Orsted's high leverage, S&P said the firm’s credit profile had been diluted by weak project management. S&P considers the construction of offshore wind parks as riskier than in the past, notably in the US, and views Orsted's future lower US exposure as a positive. In Europe, the key challenge is the effect of inflation on capex, the rating agency said.