Equinor, the Norwegian energy company, has announced plans to reduce its involvement in early-phase renewable energy projects as part of a strategic shift in response to evolving market dynamics. In a recent capital markets update, the company revealed it would trim its decade-long green energy targets from 12-16 gigawatts (GW) to 10-12 GW.
As part of this new direction, Equinor will be halting renewable development activities in Southern Europe, exiting its projects in Vietnam, and pausing its work off the coast of California. However, the company is continuing to develop offshore wind expansions in the United Kingdom and its Empire Wind 1 project in the United States.
Equinor also emphasized its commitment to cost reductions, targeting a 20% decrease in renewable energy expenses. This is part of a broader goal to achieve $2 billion in group-wide cost savings, which will be discussed in further detail at today's investor presentations.
The company cited “adjusting market conditions” as the key reason behind its revised strategy, with a focus on maintaining discipline in the highly competitive offshore wind sector. Equinor's approach will include selectively farming down projects and remaining “disciplined” in offshore wind auctions. Furthermore, the company will aim to secure “strike price improvements” while leveraging its stake in Ørsted, which provides exposure to operating renewable assets.
“Equinor will remain disciplined in a ‘heated' offshore wind market by farming down where appropriate and remaining disciplined in auctions,” the company stated in the presentation slides.
