Orsted Cancels 2.4 GW Hornsea 4 Wind Project, Incurs $837.85 Million Cost, Impacting UK 2030 Plan

18 posts • GPT (4.1)

Updated May 7, 2025, 09:46 PM

Orsted, the world's largest offshore wind developer, has cancelled the Hornsea 4 offshore wind project in the UK, which was planned to have a capacity of 2.4 gigawatts and 180 turbines. The project, located off the Yorkshire coast in the North Sea, was awarded in the AR6 allocation round in September 2024 under the UK's Contracts for Difference scheme, with a strike price of approximately £83 per megawatt-hour. The Danish company cited increased supply chain costs, higher interest rates, and rising execution risks as reasons for discontinuing development. Orsted stated that these adverse macroeconomic developments and operational challenges have eroded the expected value creation of the project, making it uneconomical despite the 15-year government contract. The cancellation will result in breakaway costs of up to 5.5 billion Danish crowns ($837.85 million), or between £400 million and £512 million. Orsted reported core earnings of $1.31 billion for the first quarter of 2025, a 14% year-on-year increase, and confirmed its full-year EBITDA and investment guidance, excluding the impact of the Hornsea 4 cancellation. The company’s shares have fallen nearly 40% over the past year. Hornsea 4 was a major part of the UK's offshore wind pipeline and its removal reduces the total contracted or constructed capacity by 2.4 GW, impacting Ed Miliband's Clean Power 2030 plan. Orsted will retain the project rights and consider future development options for the site. The Department for Energy Security and Net Zero said it will work with Orsted to explore options for future development and continues to pursue a strong pipeline of projects to deliver clean power by 2030.

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#Orsted #UK #Yorkshire #North Sea #Contracts for Difference #Danish #Ed Miliband #Clean Power 2030 #Department for Energy Security #Net Zero

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Mark Jenkinson 🇬🇧

@markjenk

“Wind energy is cheap” latest. Nearly twice the price of the current nuclear generation and it ‘doesn’t make economic sense’. Suspect they think Ed will simply hand over more cash. They may be right. https://t.co/txnYso8jG7

Reuters

@Reuters

Orsted will abandon a major offshore wind farm project in Britain. The Danish company said canceling Hornsea 4 would cost it up to $837.85 million https://t.co/qS9n8z1ZmY https://t.co/LCVjA9HzDZ

OilPrice.com

@OilandEnergy

Ørsted beat Q1 expectations with $1.31B in core earnings (+14% y/y), but warned of “mounting headwinds” in offshore wind. High costs, rates, and execution risks just led to shelving the Hornsea 4 project. #OffshoreWind #Orsted #Renewables https://t.co/xkAKmNlqj2