DAVID TURVER
On Wednesday, Ørsted, the leading offshore wind developer in the UK, announced it is cutting its investment plans out to 2030 by 25%. They said:
“We’ll reduce our investment programme towards 2030 through a stricter, more value-focused approach to capital allocation. We do this to ensure a stronger balance sheet, supporting a solid investment grade rating, and to ensure that we only invest our capital in the most financially attractive opportunities.
“Our number one priority throughout the next three years will be to deliver on our committed 8.4 GW offshore wind construction programme, which will almost double our installed offshore wind capacity. The market remains challenging, but delivering on this programme will solidify our position as the undisputed global leader in offshore wind.
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“These adjustments will not affect the execution of the 9 GW of renewable projects that Ørsted is currently constructing. The construction portfolio brings line of sight to an expansion of renewable capacity from 18 GW to more than 27 GW.
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“The previous ambition for installed renewable capacity of 35-38 GW by 2030 and the targeted EBITDA (excluding new partnerships) of approx. DKK 39-43 billion in 2030 have been discontinued.”
Danish firm Orsted is the leading offshore wind developer in the UK and claims to be the leading offshore wind developer in the world. Yesterday’s announcement comes hot on the heels of Orsted’s CEO being replaced last month and the chairman, finance chief and operating officer being fired last year. Yesterday’s news was not specific about which projects will continue and which will be cancelled. It looks like Hornsea Project 3 that is already under construction will continue.
However, significant doubt has been placed over the 2.4GW Hornsea Project Four (H4) that won a Contract for Difference (CfD) at a 2024 price of £82/MWh in Allocation Round 6 (AR6) when the results were announced last September. According to H4 latest newsletter, the project has been granted planning permission and won a CfD but it has not yet passed the Final Investment Decision. It certainly looks like this project is on the chopping block to be cancelled.
It is all but certain that Orsted will not be participating in the forthcoming Allocation Round 7 (AR7) to win new subsidy contracts. Of course, this torpedoes Ed Miliband’s plan to almost quadruple offshore wind capacity by 2030. The loss of Hornsea Project Four and the lack of participation of Orsted in new auctions will leave a massive gap to be filled. If the world’s leading offshore wind developer is feeling the pinch, then we can be fairly sure that other developers will be facing significant challenges too.
This sudden announcement may explain why AR7 announcements appear to be behind schedule. The Administrative Strike Prices for AR6 were announced in November 2023, more than four months before the auction process began in March 2024 and some ten months before the results were announced. Yet, we do not yet know the strike prices for AR7, nor the date for the start of applications. We might expect Miliband to offer even more of our money to try and keep his plans on track and for strike prices to rise again.
It is certainly looking like Miliband’s insane plans for offshore wind to provide the bulk of our electricity generation by 2030 are holed below the waterline. Instead of the answer blowing in the wind, it’s an entirely different fluid emanating from a different orifice.
I have used Twitter/X to ask Orsted UK for comment.
[Update 6/2/25] Orsted has released its investor presentation that moves Hornsea 4 out of the investment plan.
[/Update]
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This article (Orsted Cuts Investment Plans and Torpedoes Miliband’s Clean Power 2030) was created and published by David Turver and is republished here under “Fair Use”
See Related Articles Below
Where Will Miliband Get His Offshore Wind Farms From?
PAUL HOMEWOOD
https://www.neso.energy/publications/clean-power-2030
Yesterday I discussed the likelihood of Orsted pulling out of Hornsea 4, as part of their retrenchment. And with Vattenfall already opposed to joining future CfD auctions, there is now an enormous gap between Miliband’s 2030 plans and reality.
As NESO’s Clean Power 2030 makes clear, we will need to increase offshore wind power from 14.7 GW to 50.6 GW by 2030:
https://www.neso.energy/publications/clean-power-2030
Assuming Orsted do pull out of Hornsea 4, there is about 12 GW of new build offshore wind capacity due on stream, which already have CfDs. That takes us to about 27 GW.
East Anglia 2, which along with Hornsea 4, won contracts in last year’s AR6 CfD auction, is targeted to come on stream in 2028/29. It is therefore likely that if projects do not get CfDs this year will not be ready by 2030 anyway.
But more to the point, are we honestly going to find anyone prepared to build another 23 GW in the next five years?
SOURCE: Not a Lot of People Know That
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Equinor Cut Green Investment In Half
More bad news for the idiot Miliband:
Norwegian energy giant Equinor is halving investment in renewable energy over the next two years while increasing oil and gas production.
PAUL HOMEWOOD
Chief executive Anders Opedal said that the transition to lower carbon energy was moving slower than expected, costs had increased, and customers were reluctant to commit to long term contracts.
Mr Opedal told the BBC he was confident that Rosebank – a giant new oil field in the North Sea – would go ahead, despite a recent court ruling that consent had been awarded unlawfully.
He also warned that gas prices could rise next winter as European gas storage levels were lower now than this time last year.
“We are scaling down our investments in renewables and low carbon solutions because we don’t see the necessary profitability in the future,” Mr Opedal said.
It will cut investments in renewables to $5bn over the next two years, down from about $10bn.
It will also drop a target to spend half of its fixed assets budget on renewables and low carbon products by 2030.
By contrast, Equinor will be increasing oil and gas production by 10% over the next two years.
https://www.bbc.co.uk/news/articles/c1jg7k1kjwyo
This is of course part of a much wider trend, as we saw today with Orsted’s decision to call a halt to offshore wind development. Renewable energy is wholly dependent on govt subsidy, which as President has shown is illusionary.
Incredibly the far-left BBC still believe that “Rosebank is not straightforward”
What could not be more straightforward than a British oil field which could supply ultra cheap oil and gas to the country, sustain thousands of well paid jobs, send millions in tax revenues to the govt, provide an element of energy security and actually reduce emissions in comparison with importing the stuff.
Only the British hating BBC could object to that!
BTW
I cannot help but be reminded what the Xi’s useful idiot, Ambrose Evans-Pritchard said last week, when he said that the world’s investors were chasing green energy because that was where the money was!
Dream on, Ambrose!!!!!!!!!!!!!
SOURCE: Not a Lot of People Know That
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Billpayers face £800 hit from Miliband’s carbon capture gamble
MPs warn over ‘significant’ impact on household costs of pursuing ‘unproven’ technology
JONATHAN LEAKE
Ed Miliband’s decision to spend £22bn on “unproven” carbon capture technology is a high-risk “gamble” that will have a “significant” impact on bills, MPs have warned.
A damning report from the Commons Public Accounts Committee (PAC) said the technology had never been tested, was likely to prove very expensive and may not work.
Mr Miliband, the Energy Secretary, has said the UK can only reach net zero by deploying carbon capture and storage (CCS), where CO2 from power stations and factories is captured and buried underground.
The Government has committed to investing £22bn into the technology, most of which will be loaded on to consumer bills with the rest coming from taxpayers.
Based on the UK having 28m households, this equates to £800 per UK household, albeit with the costs spread over some years. Non-domestic users will also contribute, meaning the final amount paid by household users may be somewhat lower.
MPs said Mr Miliband had not properly investigated whether the technology was affordable and raised the alarm about the viability of the technology.
The PAC report said: “The Government’s backing of unproven, first-of-a-kind technology to reach net zero is high risk.
“We are calling on the Government to assess whether its full carbon capture, usage and storage (CCUS) programme will be affordable for taxpayers and consumers, given wider pressures on energy bills and the cost of living.”
The report, based on evidence from multiple experts, points to growing doubts over whether the technology can ever be viable.
It said: “There are no examples of CCS technology operating at a commercial scale in the UK, meaning the performance of early projects is uncertain.
“Evidence submitted raises concerns that CCS may not capture as much carbon as expected and experience from Norway suggests that performance on the scale expected by the Department for Energy Security and Net Zero is far from guaranteed.”
It added: “The costs of the CCUS programme are significant: in November 2024 the Government announced £21.7bn of funding over 25 years to cover only the first five CCUS projects.”
Schemes under way include Hynet, designed to capture CO2 from industries in Northwest England and North Wales and pipe it into depleted gas fields in Liverpool Bay; the East Coast Cluster in Teesside and the Humber; and the Acorn project in north-east Scotland.
The report said: “The Department [of Energy Security and Net Zero] has not indicated the likely cost of these projects. The Department and HM Treasury expect that around 75pc of the cost of supporting these early projects will be met by levies on consumers who are already facing significant financial pressures, with the remainder funded by the Exchequer.”
Responding to the report, Richard Tice, energy spokesman for the Reform Party, said: “This is another cost threatening to impoverish the UK for a technology that will not work.”
Mr Miliband launched the UK’s carbon capture programme last October, with direct support from Sir Keir Starmer and Rachel Reeves.
In a joint statement they said the technology would “create 4,000 new jobs, sustain important British industry, and help remove over 8.5m tonnes of carbon emissions each year – the equivalent of taking around 4m cars off the road”.
Ms Reeves said carbon capture was “at the heart of our plan to deliver strong growth and investment, so we can rebuild Britain and make everyone better off”.
Carbon capture forms a key part of Mr Miliband’s plans to decarbonise Britain’s power system by 2030. It will be relied on to strip up to 30m tonnes of CO2 from UK emissions each year by 2030 – and more than 100m tonnes by 2050.
Ministers hope the technology can “green” power stations and energy-intensive industries that still burn fossil fuels or wood.
Emissions are passed through a process that strips out waste CO2. This is then compressed into a liquid and pumped deep underground for permanent storage, eventually reacting with and becoming part of the surrounding rocks.
In practice, however, no one has succeeded in developing a full-scale operating carbon capture system, partly because of engineering problems but also because of the huge costs.
Scientists estimate that capturing and burying the CO2 generated by a typical gas-fired power station could absorb 20pc of its energy production.
A separate report by the National Audit Office raised similar concerns about the technology last year. It said: “There is a particular risk associated with the technology being unproven at the scale being planned, and with dependence on specialist expertise and equipment.
“For example, one of the UK emitter projects is planning to build a gas-fired power station with carbon capture, but this would be 40 times larger than any existing examples globally.”
The Telegraph: continue reading
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