The Danish group Ørsted, one of the world’s largest players in wind at sea, announced on Wednesday July 3 to give up ” in its current form In the Hornsea 4 project, an offshore wind farm of 2,400 MW which was to complete its emblematic cluster off the British coast of the North Sea.
The obstacles underlined by Ørsted
HORNSEA 4 would have emerged near the Parks HORNSEA 1, 2 and 3, already in service or under development by Ørsted. With combined power exceeding 5 GW, this complex was to become the largest offshore wind area in the world in operation.
But Ørsted indicates in its press release that ” The HORNSEA 4 project has faced several unfavorable developments, in particular the continuous increase in cost chain costs, increased interest rates and an increase in risks linked to construction and exploitation (…) qUI increased the risk of execution and deteriorated the creation of the project value ».
These difficulties reflect a global movement in the offshore wind sector in recent months: many developers – including Vattenfall, BP or IBERDROLA – have been forced to review or abandon certain projects, affected by the surge of costs (steel, cables, ships, etc.) and the level of interest rates.
-Ørsted difficulties in the United States
While the Ørsted group is faced with the suspension or the reconfiguration of several of its projects across the Atlantic, in particular in New Jersey (“Ocean Wind 1 and 2”), the decision announced this Wednesday will have the direct financial consequence an impact on the EBITDA estimated between 3 and 3.5 billion Danish crowns, which will be counted at 2e quarter 2025, according to the group.
During the presentation of its first quarter results, Ørsted nevertheless displayed a net profit almost doubled at 4.8 billion crowns (655 million euros). Its turnover increased by 8% over one year to reach 20.7 billion crowns, although this amount is lower than market expectations (Factseet consensus at 21.73 billion).
The future of British offshore wind in question
Management stresses that The Hornsea 4 project is not abandoned. « We will keep the rights of the Hornsea 4 project in our development portfolio and we will seek to develop it later in a way that is more creative for us and our shareholders “Said Rasmus Errboe, president Europe at Ørsted.
The Horsea 4 stoppage, however, questions the ability of the United Kingdom to hold its ambitious objectives: the country targets 50 GW offshore offshore installed by 2030 according to the national energy strategy. The European sector calls for political adjustments for more flexibility in calls for tenders and an increased account of the cost increase.
