Ørsted halts $1.8bn South Korea wind project: Why the 1.4GW gamble failed
Danish developer pulls bid for Incheon project, citing 'internal investment criteria'.
Danish energy company Ørsted has put its ambitious 1.4-gigawatt offshore wind project in South Korea on hold, withdrawing from the country’s upcoming fixed-price contract auction. The decision affects what would have been the largest offshore wind development by a single private developer in South Korea, located off the coast of Incheon.
The company announced it will temporarily shelve the project and conduct a comprehensive review of its global operations, including its South Korean subsidiary. In an internal notice, Ørsted stated the Incheon project no longer meets its internal investment criteria, prompting the suspension.
The Incheon project was designed in two phases—an 800-megawatt stage followed by a 600-megawatt expansion. However, South Korea’s push to lower offshore wind power prices has raised concerns about profitability. The government aims to reduce costs to 250 won per kilowatt-hour by 2030 and below 150 won by 2035, a move that could further strain the economic viability of such developments.
Financial pressures behind the suspension: offshore wind project
Despite the setback, Ørsted has not abandoned the project entirely. The company plans to redesign the Incheon development to improve its financial outlook before re-entering future bidding rounds. Meanwhile, South Korea’s renewable energy targets remain unchanged, with a goal of 220 gigawatts of total capacity by 2040, including 45 gigawatts from offshore wind.
The suspension highlights the challenges private developers face in markets where government pricing policies clash with commercial viability. Whether South Korea adjusts its approach or turns to state-backed alternatives to meet its targets remains an open question.
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