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Ørsted, TSMC Ink 'world’s Largest' Renewable Corporate Power Purchase Agreement

During the 20-year fixed-price contract, the Greater Changhua 2b & 4 offshore wind farm will receive a price for power including T-RECs.

Ørsted, TSMC ink 'world’s largest' renewable corporate power purchase agreement

Global offshore wind and renewable major Ørsted and the world’s largest semiconductor foundry TSMC (Taiwan Semiconductor Manufacturing Company) have signed a corporate power purchase agreement (CPPA). Under the new agreement, touted as “the world’s largest renewables corporate power purchase agreement”, TSMC will offtake the full production from Ørsted’s 920MW Greater Changhua 2b & 4 offshore wind farm. 

Martin Neubert, executive vice president and CEO of Ørsted Offshore, said in a statement, “Signing the largest-ever corporate PPA with the world’s leading semiconductor company shows that Ørsted is a trusted renewable energy partner for corporates and governments.”

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During the 20-year fixed-price contract, the Greater Changhua 2b & 4 offshore wind farm will receive a price for power including T-RECs (Taiwan renewable energy certificate). If Danish energy firm Ørsted’s final investment decision, expected in 2023, remains in favour then Greater Changhua 2b & 4 will be Ørsted’s third offshore wind farm in Taiwan. WIth a capacity of 920MW, the wind farm will be located in the Taiwan Strait off the coast of Changhua County.

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J.K. Lin, senior vice president of Information Technology and Materials Management & Risk Management at TSMC, said in a statement, “TSMC is happy for this opportunity to collaborate with Ørsted and not only expand the adoption of renewable energy, but also to work towards Taiwan’s energy transition to build world-class industrial environment.”

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In order to accommodate for Taiwan’s buildout of offshore wind, Taiwan’s transmission system operator, Taipower will be building new transmission grid. The operator is expected to provide Greater Changhua 2b & 4 with grid access in late 2025. The information provided in this announcement does not change Ørsted’s previous financial guidance for the financial year of 2020 or the announced expected investment level for 2020.

Martin Neubert, Executive Vice President and CEO of Ørsted Offshore, said in a statement: “We commend TSMC for their leadership in renewable energy sourcing and for taking tangible action to deliver on their ambitious greenhouse gas reduction targets. By sourcing renewable energy at an unprecedented scale, TSMC demonstrates strong support for the development of renewable energy. Signing the largest-ever corporate PPA with the world’s leading semiconductor company shows that Ørsted is a trusted renewable energy partner for corporates and governments.”

Renewable corporate PPA is a deal where an energy producer sells power to a business at a fixed price over a set period of time. In the recent past, various major U.S. firms, like Google and Amazon, signed these types of agreements to buy renewable energy. Besides, Microsoft also signed a 15-year PPA for the energy produced by a 74-MW solar power facility in North Carolina. In 2019, social media giant Facebook described itself as “a leading corporate purchaser of renewable energy globally” in 2019.

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