As a business, you have a much broader responsibility than just making money.
You have to make a profit, otherwise there's no reason for running the business -
- but you need to assume responsibility and make a broader contribution to society.
What we learned is, these things aren't in opposition to each other.
In fact, I fundamentally believe they very much go hand in hand.
The first major turning point in our transformation to renewable energy -
- was in September 2008 -
- when our CEO at the time announced a new vision.
When we started talking about this vision -
- 85 % of our power and heat production came from fossil fuels, 15 % from renewables.
The vision was that by 2040, this would have flipped around.
It was the realisation that long-term, it wouldn't be sustainable for us -
- to be producing energy based on fossil fuels.
In 2006, we started project development -
- for a large coal-fired power plant in Greifswald, Germany.
We were world champions in building efficient coal-fired power plants.
At that point, there was recognition of sustainability issues about coal -
- but the realisation back then was still: "We need coal".
In 2008, the no-coal resistance started building up -
- and the Board of Directors decided to terminate this project.
We realised that our thermal power plants weren't a sustainable business -
- both from a financial and an environmental perspective.
The pressure would increase.
So therefore, it became clear to us that this wasn't an area we wanted to invest in.
We needed to change and be at the forefront of change -
- to avoid being left behind with a dying technology -
- leaving us in a position where we wouldn't be shaping our own destiny.
When you've worked with a business for many years, you get emotionally attached to it -
- and not only the business because you know the risk profile and the value chain -
- but also the people working in it.
And then, to disappoint one part of the business and say:
"No, we want to invest in another area because we believe we have a future here."
That was really hard.
If you get cornered, and you can't find a way out of that corner -
- obviously, that can be life-threatening for a business.
There was very little growth in the business -
- and it was essentially standing on a legacy business platform -
- which had very little value creation to offer.
That's basically where we began to realise -
- that we had to transform the business more fundamentally.
We saw that we couldn't continue on the track we were on.
So we looked at our business -
- and found out that the only place where we had a competitive edge -
- and we could, if all went well, look into a scalable business -
- was offshore wind.
We were looking at our inventory.
What technology platform did we have? Where did we have competences and skills?
Where could we build a competitive advantage? That was in wind power.
That, of course, caused a lot of pushback and resistance in the company.
Especially, it wasn't clear to everybody why we were doing this.
"Is the world really changing so much?"
People said, "Yes, you can technically do it, but it comes at a huge cost."
"It's an engineering dream."
"It's not something that's really going to change how we power societies."
The first commercial-scale wind farm that we built in Denmark wasn't a success.
Actually, it didn't work. The wind turbine didn't perform the way we had hoped.
We had to demount the wind turbines, bring them back to shore -
- retrofit them to make them work in an offshore environment, and install them again.
So, the first project was expensive and a challenging learning curve.
Before I joined the wind industry, I was constructing roads in Africa.
At that point in time, my Danish boss came and visited me on the road -
- and he said, "Something new is happening in Europe, and it's called offshore wind."
I didn't doubt it because I could see with my environmental heart -
- that this was a way for me to contribute -
- but we had to reduce costs, make it smarter and more efficient.
So, it's not one place we've been optimising.
It's been a mindset in the industry.
For instance, we made an agreement with Siemens on the delivery of 500 wind turbines -
- significantly more than what was installed at that time.
The financial commitment was mind-blowing, both from us and from our suppliers.
The only way to do this economically was to do it at scale.
There's a learning around once you've found a technology, a business, or a product -
- with competitive differentiation -
- and there's a growth opportunity, you should go all in.
You should really devote yourself and your capital to mobilise behind that opportunity.
Firstly, it's not just governments or businesses that change the world.
It has to be governments and businesses working together.
Businesses can be quite good at getting things done.
Governments have a key role to play in setting the agenda -
- describing a vision, maybe setting some targets.
In that balance of energy security, energy costs, and the environment, or carbon -
- we in offshore wind got a strong message from government early in the last decade:
Offshore wind was too expensive to play a major part.
And that was a formative, transformative, clear message.
In the industry, we set a target for the cost of electricity from offshore wind -
- and started tackling that end-to-end.
We had to bring the costs down because support from governments and society -
- for offshore wind as a new technology class wouldn't remain -
- unless we brought down the costs and became competitive.
That's when we formulated a target, a round figure -
- a number which seemed completely crazy at the time.
And we made a top-down decision which wasn't backed up by any calculations.
It was a revolution to make a statement everybody subscribed to.
We've set a long-term vision of contributing to a world that runs entirely on green energy.
Then, we translated that into a strategic business ambition:
To become a global leader in green energy.
We set a handful of targets to basically guide that ambition -
- something that provides tangibility to the long-term ambition.
Then, we rolled that back into a set of action items for each employee in the company -
- things that we expect that member of the team to focus on over the next year.
If we pursue the right long-term vision, the long-term targets -
- and we execute Monday on what's needed to move us in that direction, we'll be fine.
Most of our new colleagues are really motivated by our purpose and vision.
We're doing the right things in the market, and we're doing something good for Taiwan.
We're at the frontline of this battlefield to make things happen.
We know how we'll develop, construct, and operate the wind farms -
- but our stakeholders haven't made that journey.
We need to take every chance to communicate with them -
- and also be patient and understanding throughout the communication process.
This is me, and it means where I want to be when I grow up -
- because I'm close to a wind turbine.
And then I have another one over here, and here's a little whale.
In those early days, for the first year and a half or so -
- it was getting people comfortable with the industry and our company.
Our biggest tactic was not sitting behind our desks.
We attended every meeting that discussed energy issues, political issues.
It was really that true grassroots engagement -
- that we were doing with folks in the United States.
It's a lot of hard work. When we came into the market a few years ago in the US -
- people told us we were crazy, that we'd never be able to do this.
The question is no longer when will offshore wind be a reality?
It's when will it become bigger and better?
Off the record, I wondered if there were any moments -
- when you thought this was maybe a dangerous move.
No. I never had any reservations. This was the right thing to do.
I mean, the world depends on energy, so we needed to make renewables work.
Otherwise, we wouldn't be able to power modern society in the future.
By 2025, our production will essentially reach carbon neutrality.
It's now cheaper to build offshore wind farms -
- than developing new coal- or gas-fired power plants.
The same, by the way, is true for onshore wind and solar energy.
This is a major breakthrough for the green transformation.
We must be ready to make near-term sacrifices to get it done -
- and as it's been said earlier today: Business as usual is not going to be enough.
We cannot tell our grandchildren we failed to protect the planet -
- because we were too focused on protecting our own well-being. We must act now.
You need to face that reality -
- and you need to make decisions as to how you move out of those legacy businesses -
- and start building a new long-term business platform.
If you really want to enter onto a new roadmap -
- make sure you've connected all the dots in terms of proving your concept.
Have the right competences and skills, and really think about how to scale -
- how to scale up, and what it takes.
Look at your stakeholders. Look outside the company.
Who're the stakeholders and partners you need to team up with -
- and join forces with in order to move forward?
With a transformation of this magnitude, it's impossible to chart a linear path and say:
"We're here. We want to go there. So, we need to take these five steps."
Because you can't.
You'll work in an interplay with the environment, with a lot of factors -
- so you need to do something and then see how the world responds.
How does that work? And if that works fine, you'll take the next step.
Each step has to make sense and point in the direction that you want to take -
- but it's impossible to draw a linear path and say, "This is the road we're taking".
You see many companies having a vision -
- of something that the company would like to achieve.
It's often a vision of what the company should be -
- not what contribution the company can make -
- to a better and more sustainable long-term future for the planet.
It's important because many visions are about the company wanting to be this or that.
But for it to be truly aspirational, it has to make a bigger contribution.
It has to be a bigger idea. It's not about the company.
It's about what the company can contribute to a more sustainable world.
When we started out, 7 % of our profits came from renewables. Today, it's close to 100 %.
So, the transformation is pretty much complete.
So, there's been a lot of calculated risk-taking in the company.
But it has built a certain culture, which is quite entrepreneurial and ready -
- to make big decisions in relatively fast processes -
- and assume quite a bit of risk.
How do you preserve that culture? The journey ahead is all about green growth.
The task in front of us is enormous, but that means a massive growth opportunity.
There's a transformation to be done, global infrastructure to be renewed and changed -
- new technologies to be deployed, massive investments to be funded -
- and thousands upon thousands of people -
- who've got to bring their skills and disciplines to bear on making it happen.
That's an incredible opportunity.
That's the kind of growth opportunity for business, the kind of demand-pull -
- which businesses love.
It's been a difficult transformation -
- but if you get the right momentum, you can do much more than what you could imagine.
The next step for us is to help the world transform.
We now face the opportunity, from a strong platform -
- but also the obligation, to ensure we don't stop here and rest on our laurels.
That we say, "How can we contribute globally -
- to scale and accelerate the solutions that are already there?"
And how can we ensure that we stay an innovation leader in crafting new solutions -
- that'll make it even easier to accelerate the journey the world needs to be on?
I believe Ørsted's next transformation is to leverage the strengths and the insights -
- and the capabilities we have to ensure that we help countries all over -
- make a transformation for everybody and accelerate the fight against climate change.
The biggest risk of climate change is the perception that somebody else will solve it.
Everybody who has a position in society or in a company where they're able to act -
- through clarity of direction or courage in taking action has an obligation to do so.
And to me, the word 'obligation' is vital.
This isn't just an opportunity. It's an obligation.