According to Financial Times News, Denmark’s Ørsted has agreed to sell a 50% equity stake in the Hornsea 3 offshore wind farm to Apollo Global Management in a $6.5 billion deal that includes funding half of the project’s remaining construction costs. The 2.9 gigawatt project, located 160km off the Yorkshire coast, is scheduled for completion around the end of 2027 and will become the world’s largest offshore wind farm upon finishing. Ørsted CFO Trond Westlie described Apollo’s involvement as bringing “infrastructure expertise and scaled capital” to the project, while Apollo partner Leslie Mapondera emphasized their role as a “provider of long-term and flexible capital solutions.” This transaction follows Ørsted’s recent $9 billion rights issue and comes amid significant political and economic challenges for the offshore wind industry, particularly in the United States where the company faced project cancellations and regulatory obstacles. This landmark deal reveals much about the evolving financial landscape of renewable energy.
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The Private Capital Tipping Point
Apollo’s record $17 billion in European energy infrastructure deals this year represents a watershed moment for renewable energy financing. We’re witnessing the maturation of offshore wind from a niche sector dominated by specialized developers to a mainstream asset class attracting sophisticated institutional capital. The scale required—Hornsea 3’s 2.9GW capacity could power approximately 3 million homes—has simply outgrown traditional development models. What’s particularly telling is Apollo’s parallel investments in Germany’s electricity grid with RWE and the $4.5 billion financing for EDF’s Hinkley Point C nuclear plant. This isn’t scattered betting; it’s a coordinated strategy to build integrated clean energy ecosystems where massive generation projects connect to upgraded transmission infrastructure.
The Developer’s Existential Dilemma
Ørsted’s pivot toward partnership reflects a broader industry reckoning. The company’s traditional “develop-and-divest” model worked well when projects were smaller and interest rates were negligible. Today, with $4 billion in US project write-downs and political headwinds from the Trump administration’s hostility to offshore wind, even the world’s largest developer can’t shoulder these risks alone. The timing is crucial—this deal follows Ørsted’s abandonment of two major US projects and comes as the company faces stop-work orders on other developments. What we’re seeing is the end of the era where single companies could develop multi-billion dollar projects independently. The future belongs to consortiums and strategic partnerships that can distribute both capital requirements and political risk.
The Political Risk Reckoning
The Hornsea 3 deal underscores how political volatility has become the single greatest threat to renewable energy megaprojects. Ørsted’s experience with the Trump administration—where presidential intervention thwarted their Sunrise Wind project sale and resulted in stop-work orders—demonstrates that even technically sound projects can fall victim to political winds. This reality is forcing developers to rethink geographic concentration and risk management. The appeal of the UK market, despite its own challenges, lies in relative policy stability and clear decarbonization targets aiming for a fully clean electricity system by 2030. Going forward, we’ll see more developers building political risk mitigation into their financing structures, potentially through sovereign guarantees or multilateral development bank participation.
The Future of Project Finance
This transaction establishes a new template for how the next generation of offshore wind projects will be funded. The combination of Ørsted’s development expertise with Apollo’s “scaled capital” represents an optimal risk-sharing arrangement. Look for similar structures to emerge across the industry, particularly for projects exceeding 1GW capacity. The critical insight here is that private capital isn’t just providing funding—it’s bringing sophisticated infrastructure management capabilities that can optimize operations across an asset’s 25-30 year lifespan. As renewable capacity growth accelerates globally, this partnership model will become essential for managing the complex interplay between construction timelines, supply chain constraints, and evolving regulatory frameworks.
Global Implications Beyond Europe
While this deal focuses on European infrastructure, its implications extend globally. The demonstrated willingness of private capital to commit billions to long-duration energy assets signals confidence in offshore wind’s fundamental economics, despite short-term challenges. This should accelerate development in emerging markets from Asia to Latin America where local developers lack the balance sheet strength for solo projects. However, the concentration of such large-scale capital in fewer hands raises questions about competition and innovation. Will the entry barriers become so high that only consortiums of giants can play? The next 12-24 months will reveal whether this model enables faster decarbonization or creates new bottlenecks in the energy transition.
