Danish firm shelves huge UK windfarm project over rising costs
The world's biggest wind power developer has cancelled plans for one of the UK's largest offshore windfarms, in a significant blow to the government's green energy targets.
The Danish wind power company Ørsted said the Hornsea 4 project no longer made economic sense because of soaring costs in the industry's global supply chain, after it won a government contract last year.
The decision to halt work on the project is a major blow to the government's plan to quadruple the UK's offshore wind capacity by the end of the decade to help create a virtually fossil-fuel-free electricity system.
The fourth phase of the huge Hornsea windfarm, located off the Yorkshire coast, was expected to use 180 giant turbines to generate enough green electricity to power the equivalent of 1m homes, or 2.4 gigawatts of power capacity.
Ørsted's chief executive, Rasmus Errboe, said 'the combination of increased supply chain costs, higher interest rates and increased execution risk' meant the project was unlikely to provide value for the company.
The project is the latest to be derailed by increased costs caused by higher inflation and interest rates combined with problems in the global offshore wind supply chain in recent years.
Last year Ørsted scrapped two offshore wind projects off the US coast because of concerns over rising costs and delayed the start of a third project off the coast of Rhode Island and Connecticut by a year, to 2026.
In 2023 the Swedish energy company Vattenfall stopped work on the multibillion-pound Norfolk Boreas windfarm in the North Sea, which was designed to power the equivalent of 1.5m British homes, because it was no longer profitable.
Ørsted said on Wednesday that the wind industry faced short-term challenges such as supply chain issues and 'regulatory and macroeconomic developments'.
Such problems have led to concerns over the UK government's renewable energy goals, piling pressure on its auction for new renewable energy contracts.
The government plans to double the UK's onshore wind, triple its solar power and quadruple its offshore wind power capacity by the end of the decade. It hopes to relegate gas plants to just 5% of the UK's electricity generation by 2030 to create a clean power system.
Dhara Vyas, the chief executive of Energy UK, which represents the industry, said the loss would 'raise the stakes' on the the next auction round, due in the summer, and it was 'vital that the government doubles down to ensure [it] is a success'.
Jane Cooper, the deputy chief executive of RenewableUK, another industry group, said the auction's parameters should reflect the industry's costs.
Cooper also called on the government to rule out the introduction of controversial plans to overhaul the electricity market by introducing 'zonal pricing', which she said would 'drive the cost of investment up even further'.
skip past newsletter promotion
Sign up to Business Today
Get set for the working day – we'll point you to all the business news and analysis you need every morning
Privacy Notice: Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Privacy Policy. We use Google reCaptcha to protect our website and the Google Privacy Policy and Terms of Service apply.
after newsletter promotion
A government spokesperson said it continued to have 'a strong pipeline of projects' to provide clean power by 2030 and it would work with Ørsted to get Hornsea 4 back on track.
The spokesperson added: 'Through our mission we will deliver an energy system that brings energy bills down for good and bolsters Britain's energy security as part of our plan for change.'
For US windfarm developers the economic challenges facing the industry have been compounded by the incoming Trump administration's vow to end offshore wind development 'on day one'. It has issued a stop-work order to a major offshore wind project developed by Norway's state energy company Equinor.
However, Ørsted said the long-term outlook for offshore was strong because of the world's growing demand for electricity and a fresh focus on 'energy security and affordability' that renewable energy provides.
It has been a turbulent time for Ørsted: it implemented a restructuring plan in 2024, and it cancelled dividend payouts to shareholders for the 2023-25 financial years in an attempt to bolster its finances. Its market value has plunged by about 80% since its peak in 2021.
Britain's offshore energy industry took another blow on Wednesday when the largest oil and gas producer in the North Sea set out plans to shrink its Aberdeen-based workforce by a quarter.
Harbour Energy blamed the UK government's windfall tax on North Sea oil and gas revenues – the so-called energy profit levy – for its financial struggles, which could lead to up to 250 jobs being cut from the company in the coming months.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
36 minutes ago
- Yahoo
Fact check: More people leave than arrive on current youth mobility schemes
On the BBC's Today programme on May 19, from around two hours and 21 minutes, Business and Trade Secretary Jonathan Reynolds said the UK's youth mobility arrangements with other countries reduce net migration. Asked 'how do you know there will be fewer people coming here than leaving?' Mr Reynolds said: 'Well, I've got 13 schemes in action already and that's the evidence of them.' He later added: 'I tell you the evidence of the current schemes just so you know is that they're a net negative on immigration.' Around 24,400 youth mobility visas were issued to people wanting to come to the UK in 2024. Although figures are patchy for how many Britons go abroad, data from just three countries – Australia, New Zealand and Canada – suggests that 68,495 British citizens travelled to those countries in 2024 (the Australian data is for the 12 months to the end of June 2024). That would suggest that Mr Reynolds is right. However it does not take into account that Britons going abroad on these temporary visas will sooner or later come back, as will those who come to the UK. It is also not clear that this pattern will repeat in any similar deal with the EU. The UK population is much larger than those of Australia, New Zealand and Canada, so there are more Britons who can go to those countries than can come here. With the EU that is reversed. How many people come to the UK on a youth mobility visa? Government data shows there were 24,437 people who were handed a youth mobility visa last year. Most of these were from one of the 13 countries with which the UK has a reciprocal arrangement. A small handful of visas – 131 in total – were for people from countries other than the 13. The Migration Observatory at the University of Oxford has suggested that these are the result of errors in data recording, or due to people having dual nationalities. The top three countries that sent people to the UK on youth mobility visas between January and December 2024 were Australia (9,754 visas), New Zealand (4,304 visas) and Canada (3,060 visas). How many Britons go abroad on youth mobility type schemes? Figures are patchy on how many British people have gone abroad on a youth mobility scheme. The Department for Business and Trade was unable to share data. Australia publishes a twice-yearly report into what it calls its working holiday visa programme. That is the Australian equivalent to the UK's youth mobility scheme. The latest such report covered the 12 months to the end of June 2024. That report showed that Australia issued 48,973 working holiday visas to UK citizens. Data from New Zealand is available on the website of the Ministry of Business, Innovation and Employment. Using its migration data explorer produces a spreadsheet which shows that there were 9,486 working holiday visas granted by New Zealand to UK citizens in between January and December 2024. Canadian data does not appear to be publicly available, but the figures were provided to the PA news agency by the Canadian Department for Immigration, Refugees and Citizenship. The data shows that in 2024 there were 9,972 work permits issued to UK and UK overseas territories citizens under the country's working holiday scheme, and a further 64 people had their permits extended. How do incoming youth mobility visas compare to outgoing? Net migration is a figure which subtracts the number of people coming into the country from the number of people leaving. The data cited above suggests that while 9,754 Australians came to the UK on youth mobility visas, 48,973 Britons went in the opposite direction. It must be noted that the time periods measured here are different, the Australian data is for the 12 months ending June 2024, while the UK data is for the 12 months ending December 2024. Meanwhile the data suggests that 4,304 New Zealanders came to the UK while 9,486 Britons went in the other direction. Data further shows that 3,060 Canadians came to the UK in 2024, while 9,972 Britons went in the other direction. This suggests that for each of these three countries the youth mobility schemes are – as Mr Reynolds suggested – reducing net migration. In fact Australia alone appears to receive twice as many Britons (48,973) as all people who the UK receives from all 13 countries added together (24,437). However, it should be noted that because youth mobility schemes are time-limited, Britons going abroad and people who have come to the UK on such visas will eventually be forced to return. This means the UK's inbound migration figures should take into account not just Australians and Canadians – for example – coming to the UK, but also Britons returning from Australia and Canada after their youth mobility visas expire. If it is assumed that everyone returns then over a longer time frame the youth mobility programmes will have a neutral impact on net immigration because every Briton who leaves the UK will come back and every non-Briton who comes to the UK will leave. This does not take into account the people – both Britons abroad and non-Britons in the UK – who apply for a different visa to stay in their adopted country. Do these conclusions also apply to the EU scheme? The impact on net migration of the potential EU scheme will depend on the details of the agreement between London and Brussels. Madeleine Sumption, director at the Migration Observatory, told the PA news agency that the size of the cap on the programme would be vital for the impact on net migration. She said the fact the UK sends more people to Australia, Canada and New Zealand than it receives from them 'probably results from the fact that the UK has a much larger population than they do, so we just have more young people potentially interested in moving'. With the EU scheme, Ms Sumption said, the population sizes are flipped – that is to say the EU's population is much bigger than the UK, leaving more young people who might be willing to come here. Therefore the smaller the cap on the number of visas is, the more likely both the EU and UK will fill their quotas. If both fill their quotas – and the quotas going both ways are the same – then the impact on net migration will be zero. However if the cap is large then it is more likely that there will not be as many Britons going to Europe as are coming in the opposite direction, which will bring up net migration. But, as with the existing schemes, both Britons in Europe and Europeans in the UK will eventually have to leave unless they find another visa, which over the long run should mean that the programme has a neutral impact on net migration. BBC – Today, 19/05/2025 Migration Observatory – What is the Youth Mobility Scheme and how does it work? (archived) – Entry clearance visas granted outside the UK (archived page and spreadsheet, using tab Data_Vis_D02) Australian Department of Home Affairs – Visitor visa statistics (archived) Australian Department of Home Affairs – Working Holiday Maker visa program report (archived) New Zealand Ministry of Business, Innovation and Employment – Migration data explorer (archived page and downloaded spreadsheet. To download the correct spreadsheet, instructions can be found at (archived): In dataset select 'W1 work decisions', in time period select 'calendar year' and in variables select 'application substream', 'application criteria' and 'decision type') Canadian data provided to PA news agency (archived) Madeleine Sumption profile (archived)
Yahoo
an hour ago
- Yahoo
Factbox-UK Market Exodus: Companies that have moved away from a London listing
(Reuters) -British money transfer firm Wise became the latest UK listed firm on Thursday to say that it intends to move its primary listing to the U.S. from London. A growing number of companies have shelved or shifted plans to list in London, due to investor pushback and Brexit-related challenges that have pressured UK market valuations. Instead, they have opted for the U.S. and other markets, where they see stronger appetite and higher valuations. Cobalt: The Glencore-backed metals investor scrapped its plans for a London IPO on Wednesday, which, according to one source, was driven by a lack of demand. The company, valued at around $230 million, would have seen London's largest market debut since Air Astana's listing in February 2024. Indivior: The drugmaker said on Monday it will cancel its secondary listing on the London Stock Exchange effective July 25, citing cost savings and a desire to align more closely with its U.S.-focused operations. The 1.25 billion pound ($1.70 billion) pharmaceutical firm will retain its primary listing on the Nasdaq. BHP: The world's largest miner by market value ($125.10 billion) made Australia its primary stock market when it ended its dual-listing structure in 2021. The company was the second largest by market value in London when it left the stock market. Unilever: The Ben & Jerry's maker in February picked Amsterdam as the primary listing for its ice cream business. The business, which generated a turnover of 8.3 billion euros ($9.47 billion) in 2024, will have secondary listings in London and New York. Glencore: The Swiss miner said in February it was considering moving its primary listing from London. The company, with a market value of 34.5 billion pounds, said New York was at the top of the list under consideration. Shein: The online fast fashion retailer is working towards a listing in Hong Kong after its proposed initial public offering (IPO) in London failed to secure the green light from Chinese regulators, three sources with knowledge of the matter told Reuters in May. However, before its attempt to list in London, Shein had pursued a listing in New York, as part of its efforts to gain legitimacy as a global, rather than a Chinese company, and access to a wide pool of large Western investors. Ashtead: The second-largest equipment rental company in the U.S. said in December it plans to shift its listing to New York. With a market value of 18.3 billion pounds, Ashtead has been listed in London since 1986, and transformed into a major U.S. player in the early 2000s. Just Eat Takeaway: The Amsterdam-listed food delivery company delisted from the London Stock Exchange in December, citing efforts to reduce administrative and regulatory costs. The company has a market value of 4.05 billion euros. Flutter Entertainment: The FanDuel-owner in 2024 moved its primary listing to the New York Stock Exchange (NYSE), just a few months after it added a secondary listing in the US. CRH: The building materials solutions provider, which has $61.29 billion in market value, switched its primary listing to the NYSE in 2023, while maintaining a standard listing on the London Stock Exchange. Arm Holdings: The UK-based chip designer chose Nasdaq over London for its 2023 IPO — the largest of that year. The company, now valued at just over $138 billion, was previously listed in London for 18 years till 2016, when it was taken private by SoftBank in a $32 billion acquisition. ($1 = 0.8763 euros) ($1 = 0.7355 pounds) Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
an hour ago
- Yahoo
Geely won't build plants in U.S., Europe amid excess global capacity, founder Li Shufu says
Geely Holding Group will not build assembly plants in Europe or the United States as the auto industry's globalization push stalls and the world faces a surplus of factories, founder and chairman Li Shufu said. The company instead should further enhance coordination with Volvo and other partners, including Renault and several other automotive companies, in the U.S. and Europe, Li said during a recent internal meeting at the company. He didn't elaborate on what he meant by coordination, according to a video of the meeting released by Geely on May 28. Sign up for the weekly Automotive News China newsletter, including commentary by journalist Yang Jian and highlights from top manufacturers and supplier news from China and Asia. Geely and other automakers face increased competition in China from legacy automakers and startups such as Xiaomi. BYD has launched a bruising price war that sparked a recent sales surge but is also undercutting profits across the industry as other automakers are forced to match the discounts. Li's comments come amid a trade war between the U.S. and China that has effectively locked Chinese automakers out of the American market because of high tariffs on electric vehicles. BYD, Chery and other Chinese automakers are also making a push to expand sales overseas with foreign plants or through exports, adding more competition in key markets including Brazil. In Europe, Chinese automakers also face steep tariffs on EVs, prompting them to localize output. Globalization has come to an end after expanding for more than 40 years, and it is time for Geely to adjust its global strategy, Li said. 'We should avoid constructing production facilities, which involves purchasing land, building factories, buying equipment and hiring employees, as this is not an optimal approach given the global surplus in auto production capacity,' he said. RELATED ARTICLE: Geely, in leadership shakeup, appoints Zeekr head as new group CEO; Q1 profits jump In South Korea and other markets, Geely 'should do what it can to cooperate with Renault and other Western automakers on [utilizing their] production capacity,' Li added. Geely is still seeking what he called 'breakthroughs' in some 'key' markets, Li told staffers at the internal meeting. 'For example, in Southeast Asia, particularly in Malaysia, we must accelerate localization efforts, including the localization of components and talent,' he said. 'This is an urgent priority that requires immediate action,' he added. Geely Holding Group, based in Hangzhou, the capital of east China's Zhejiang province, builds and markets gasoline and electrified cars and light trucks under Geely and other brands. The private Chinese conglomerate owns Swedish carmaker Volvo Car Corp. and British taxi manufacturer London EV Co., previously known as London Taxi Co. It also holds shares in German luxury carmaker Mercedes-Benz and British sports car brands Aston Martin and Lotus, as well as Malaysian car brand Proton. Geely Holding Group assembles and distributes battery-electric vehicles for Smart and Lotus brands in China. Outside China, the Chinese group produces vehicles under the Geely brand in Belarus. It also produces and markets vehicles under Proton in Malaysia. In October 2022, Geely Holding Group acquired a 32 percent stake in Renault Group's Korean subsidiary to produce hybrid vehicles and internal combustion engine models for the local market. The two sides created a joint venture in London in May 2024 to develop hybrid and combustion powertrain systems including engines, transmissions, hybrid systems and batteries for their own brands and other global automakers including Nissan Motor Co. and Mitsubishi Motors Corp. On Feb. 18, Geely Holding Group signed a preliminary deal with Renault allowing it to use the French automaker's plants and distribution network in Brazil to build and sell vehicles locally. Have an opinion about this story? Tell us about it and we may publish it in print. Click here to submit a letter to the editor. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
