There are a couple of aspects to the story that broke this morning - that mega offshore wind developer Ørsted, one of my all-time favorite Green villains, had pulled the plug on a British project known as 'Hornsea 4.'
Is that a consumately British name or what?
In any event, a number of hard realities have come to bear on the company's plans, the most important of which being anything that dents their already fragile profit margin. Therefore, they have decided to get out of the Hornsea offshore farm before it's even gotten off the ground, well before the drop-dead date in their contract.
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 two years ago.
This abomination was going to be massive, but the sheer size meant nothing to Ørsted's bottom line.
...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.
However, 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.
'Providing value to the company' was impacted because while supply issues, interest rates, and insurance costs have all increased, what has not done so have been the already exorbitant and extortionate rates baked into the contract for what's known as 'differences.'
...Wind farm operators have complained that soaring supply chain costs has pushed up the price of wind turbines, while increases in global interest rates have raised refinancing costs substantially.
They say this has rendered government subsidy contracts, known as Contracts for Difference, unviable.
A contract for differences is an agreement between a buyer and seller, where the buyer will pay the seller the difference between the current value of an asset and its value at the time the contract was made.
And all it does is guarantee the developer a profit at the expense of the unwitting consumer at the far-end of the deal the government's made for them.
...Dan Slater, an analyst at Zeus Capital, said: “This is a direct consequence of the cost increases we have seen in the offshore wind industry, and is a signal from the sector that the UK is likely to have to pay yet higher guaranteed electricity prices if the country wants to continue increasing the volume of new renewables in its energy mix.
“This also highlights how challenging the government’s current renewable power target is likely to prove, and how expensive it could be to achieve.”
At what point does the British government cry 'uncle' out of mercy for the British utility rate payer?
With Labour in charge and Ed Miliband at the head, who could say?
Miliband's plans are to take the power generation mix for the United Kingdom to a renewables-heavy grid by 2030 - that's only *does #mathz* five short years away.
The man is out of his mind and taking the country down with him.
Mind you, the rest of the country polls overwhelmingly 96%-4% in favor of chucking all the renewables and just keeping the bloody lights and heat affordable and on.
It's simple. That's all anyone requires.
The climate cultists in Labour don't want to hear any of it, and are going to be thrice as determined to power forward and impose their dystopian future on their fellow citizens after this setback.
...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 added that it was “vital that the government doubles down to ensure [it] is a success”.
Disgustingly, they are also predictably playing into the wind giant's hands, as energy officials are already talking about making sure the next round of wind auctions are sufficiently greased with enough lard to make it worth the wind developers' time and effort, not to mention making sure there are no burdensome regulations concerning pricing controls.
...This should include making sure that the auction’s parameters reflect the industry’s costs, according to Jane Cooper, the deputy chief executive of RenewableUK, another industry group.
Cooper also called on the government to rule out the introduction of controversial plans to overhaul the electricity market by introducing “zonal pricing” which would “drive the cost of investment up even further”.
There had already been widespread speculation that Ørsted was only stepping back from this contract temporarily in order to be able to rebid for it at far more lucrative and favorable terms in a subsequent round, counting on a desperate Miliband to sweeten the money pot in order to reach his 2030 goal.
...Industry experts have suggested Ørsted latest move could be tactical, potentially allowing it to bid in the next round of contracts this autumn which is is widely expected to offer more favourable terms than previously. It means Ørsted could make far greater profits by shifting to a new subsidy regime.
Andrew Bowie, acting shadow energy secretary, said: “Once again, the full cost of Labour’s net zero madness is on stark display.
They couldn't make the project happen at an already astronomical guaranteed £83/MWh. So they're gonna wait around for a chance this fall to see if they can suck more out.
So, obviously, the project needs even a higher guaranteed electricity price (and that means, a CfD above, or well above, current average wholesale prices). If the UK governments delivers that extra subsidy, how that would be compatible with lowering costs for consumers?
— Javier Blas (@JavierBlas) May 7, 2025
Miliband is not above changing rules to get where he wants the country to go, and he has one helluva hill to climb to finish destroying Britain's energy security completely.
Miliband is already behind his CP2030 plan, with capacity in 2024 well behind target. The removal of Hornsea Project Four makes the task even harder (4/n) pic.twitter.com/tORYu7QWRy
— David Turver (@7Kiwi) May 7, 2025
No worries. Labour knows best.
WE GET YOUR MONEY FOR DOING NOTHING
GREEN ENERGY INDUSTRY
— Günter Bartsch (@BOXERR100R) May 7, 2025
Wind power industry / Intensive care unit
The wind power industry is actually clinically dead. It is only being kept alive artificially by GIGANTIC subsidies.
The same applies to the solar photovoltaic industry, etc.
Germany Dortmund/Witten pic.twitter.com/5QvO8QohjZ
Unicorn farts and Green fever dreams.
Yes, the costs of Net Zero are astronomical.
— ralph ellis (@ralfellis) November 26, 2024
About £4 trillion.
The basic costs are fairly straightforward.
If we go all wind, we need 350 gwh of wind
(more, if we have hydrogen storage).
Hornsea-3 is 3gw costing £10 billion.
So we need 116 Hornsea-3s, costing £1,160 billion… pic.twitter.com/eaJ39moAfl
...Hornsea-3 is 3gw costing £10 billion. So we need 116 Hornsea-3s, costing £1,160 billion
But they conveniently forget they will need replacing in 25 years, so in a 50-year plan (to compare with nuclear), we need to double this. Call it £2,000 billion for cash, for a full wind-array.
The CCC and RS then say that economies of scale will halve this figure. But as I have pointed out, the huge demand for materials, like rare earths and copper, are likely to send costs soaring.
I have disregarded solar, as it does not work in winter. Thus we will need another generation system, just for winter.
...The CCC then conveniently forget about stored backup, while the RS seriously underestimate the costs. We need 30,000 gwh of backup.
...In fact, to service an all-electric economy, we would need to double the number of gas power stations. So this is not Net Zero at all. And these extra gas power stations will cost an additional £35 billion, plus gas usage costs.
Thus - total cost of renewables is £4 trillion. And this does not include replacement of transmission lines, and all the domestic and commercial appliances.
...And if Millipede goes for CO2 capture, costs will increase once again. Carbon capture is purely parasitic, in terms of cost and energy usage. It provides nothing.
What, Labour worry? Not at all.
...A spokesman for the Department of 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 Ørsted to get Hornsea 4 back on track.
Keep calm and carry on.
It's only money.
