Work halted on huge windfarm in North Sea amid rising costs
Energy giant Orsted has said it is stopping work on one of the UK's biggest upcoming offshore wind projects, in a blow to the Government's clean energy plans.
The world's largest offshore wind developer said it will halt its Hornsea 4 project, a massive planned wind farm in the North Sea that could have powered more than one million homes.
Orsted said the project had suffered rising supply chain costs, higher interest rates and increasing risk of not finishing the project on time.
It said the problems had 'increased the execution risk and deteriorated the value creation of the project'.
The move comes as the Government tries to massively ramp up Britain's renewable energy generation capacity, mainly through offshore and onshore wind and solar power.
The transition is part of its plan to decarbonise the power grid by 95% by the end of this decade.
Chief executive Rasmus Errboe said: 'I'd like to emphasise that Orsted 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.'
The Danish energy company said the move could cost it up to £513 million in break costs from cancelling contracts with suppliers.
A spokesperson for the Department for Energy Security and Net Zero said: 'We recognise the effect that globally high inflation and supply chain constraints are having on industry across Europe, and we will work with Orsted to get Hornsea 4 back on track.
'We have a strong pipeline of projects to deliver clean power by 2030 and our mission-led approach ensures we can steer our way through global pressures and individual commercial decisions to reach our targets.'
Orsted has had a difficult few years, after high interest rates worsened the economics of developing renewable energy, and it recently replaced its former chief executive with Mr Errboe earlier in 2025.
It said in February that it would cut investment to 2030 by 25%, as part of an attempt to restore its falling share price, which has dropped more than one-third in the last year.
Meanwhile, the state-backed firm's recent foray into the US was also delivered a significant blow when Donald Trump was elected, promising to halt green energy and refocus on fossil fuels.
Andrew Bowie, the Conservative acting shadow energy secretary, said the decision indicated that the UK Government's net zero goal is 'not sustainable'.
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