ØRSted Work on Wind Farm in the UK widespread attention to high costs

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The world’s largest wind developer in the world stops working on a large project in the UK that blames the costs of height and the risk of delay, in a blow to the clean energy goals in Britain.

On Wednesday, Ørsted said it stopped spending and canceling its contracts for the Hornsea 4 project in the North Sea, a 2.4 GB project that was able to operate more than a million homes.

The project won a contract from the UK government last year, which guarantees a fixed electricity price of 58.87 pounds per hour of megabytes, however Ørsted He said that it cannot currently make the proposed wind farm.

“Developments of the harmful total economy, the ongoing challenges of the supply chain, and the increase in implementation, market and operation have eroded the creation of value.”

He added that the company will retain development rights and “seek to develop the project at a later way in a more interesting way for us and our shareholders.”

The Danish Energy Company said that the decision will cost DKR3.5BN-DKR4.5 billion this year (399 million pounds-513 million pounds) in the costs of breaking the canceled contracts with suppliers.

The UK government wants to expand the ability of the country’s marine winds more than three times by 2030 to achieve its goal of removing carbon in the electricity system by that time.

Horny 4, off the coast of Yorkshire, was the largest wind farm abroad to secure a government contract in the auction round last year and one of only two projects for the first time.

The decision of Ørsted comes because he tries to restore his credibility with the shareholders after a few bruises, as it moved away from foreign projects in the United States.

Errboe, one of the company’s familiarity, was appointed CEO in January to replace the MADS Nipper, who headed a decrease of 80 percent at the company’s share price from the heights in January 2021. The company’s value is currently estimated at $ 112 billion (12.7 billion pounds).

The wind sector abroad is fighting increasing costs over the past few years arising from the strains of the supply chain and higher interest rates. This industry was exposed this year to increase the decision of US President Donald Trump to suspend development permits.

Errboe warned last month that the industry was at the risk of a “landmark” and called on European governments to do more to support the sector.

The Hornsea 4 project is followed by the Swedish Vattenfall Hospital Project in July 2023 to withdraw from the 1.4GW Wind Farm Project off the Norfolk coast, due to high costs.

The project, Norfolk Purias, was later sold to the German Energy Group, which is planning to develop it.

“It will work with Ørsted to obtain Hornsea 4 on the right track.”

“We are aware of the impact of inflation restrictions and the high supply chain globally on industry throughout Europe. We have a strong pipeline of projects to provide clean energy by 2030.”