Constructing windfarms in Taiwan was a new challenge for Ørsted’s treasury. The 920MW Greater Changhua 2b and 4 offshore wind farm is one of the company’s largest global projects and follows the construction of Ørsted 900MW Changhua 1 and 2a wind farm.

The Greater Changhua 2b and 4 project is funded by capital provided by Ørsted, including debt capital sourced from the domestic Taiwanese market by the Ørsted group. However, simplifying payment flows for multinational suppliers is crucial, due to the high frequency of invoices and large transaction values involved. Firstly, Ørsted aims to improve net working capital by extending payment terms in general.

Secondly, the project involves a large component of both local and foreign suppliers, and with Taiwan being a regulated market where banks have their own stringent process for supply chain financing, a legal assignment approach over the full receivable is the current market practice. This created a new challenge as Ørsted could only issue one invoice under one receivable for each vendor, and given the large transaction size, it was challenging for a singular banking partner to finance even one receivable, let alone the full project.

Addressing these challenges were important for the successful execution of the project. It is uncommon to have a centralised platform providing a consistent, digitalised and fully automated supply chain solution for such a large project and volume, which is time sensitive.