Ørsted has decided to hit pause on the Hornsea 4 offshore wind project in the UK—at least in its current form. Since landing a Contract for Difference (CfD) in round 6 last September, the 2,400 MW project has run into some major headwinds. Rising supply chain costs, higher interest rates, and growing challenges in getting such a large-scale project built on schedule have all played a part.
Together, these issues have made the project riskier and less financially attractive. So for now, Ørsted is stopping any further spending and ending its supplier contracts for Hornsea 4. This means it won’t move ahead under the CfD deal it won in 2024.
That said, Ørsted isn’t walking away completely. The company still holds rights to the seabed, has a grid connection agreement in place, and a Development Consent Order—so there’s room to revisit the project in a different form down the line.
Rasmus Errboe, Group President and CEO of Ørsted, says:
”We remain fully committed to being an important partner to the UK government to help them achieve their ambitious target for offshore wind build-out and appreciate the work they’ve done to deliver a clear framework to support offshore wind. However, our capital allocation is based on a strict and value-focused approach, and after careful consideration, we’ve decided to discontinue the development of the Hornsea 4 project in its current form, well ahead of the planned Final Investment Decision later this year.”
“We’ve been maturing the project over the past nine months and have been working relentlessly with stakeholders and suppliers to manage the different project risks for a project of this scale. Throughout the development phase we’ve been very diligent in our approach to capital commitment to our suppliers, and our committed capital is well below our threshold. The adverse macroeconomic developments, continued supply chain challenges, and increased execution, market and operational risks have eroded the value creation.”
“I’d like to emphasise that Ørsted continues to firmly believe in the long-term fundamentals of and value perspectives for offshore wind in the UK. We’ll keep the project rights for the Hornsea 4 project in our development portfolio, and we’ll seek to develop the project later in a way that is more value-creating for us and our shareholders.”
Ørsted expects to take a financial hit from stepping away now, with break-away costs estimated at DKK 3.5 to 4.5 billion in 2025. The impact on earnings before interest, tax, depreciation, and amortisation (EBITDA) is expected to be DKK 3.0 to 3.5 billion, including write-downs and contract cancellation costs. An additional DKK 0.5 to 1.0 billion in capitalised construction costs will also be written down (this won’t affect EBITDA).
Even with this setback, Ørsted is sticking to its full-year guidance for 2025. EBITDA is still expected to land between DKK 25–28 billion, and total investments are still forecast at DKK 50–54 billion.
About Ørsted
Ørsted is working toward a world fully powered by green energy. The company builds and runs offshore and onshore wind farms, solar energy systems, energy storage, and bioenergy facilities. Ørsted is a global leader in climate action, with net-zero targets certified by the Science Based Targets initiative. Headquartered in Denmark, Ørsted employs about 8,300 people and is listed on Nasdaq Copenhagen. In 2024, it brought in revenue of DKK 71.0 billion (around EUR 9.5 billion).