Ørsted, the Danish energy company and world’s largest offshore wind developer, refers to a recent announcement to revive its Hornsea 4 project in the North Sea.

This comes after UK Energy Secretary Ed Miliband (under the Labour government) rolled out a major subsidy package in January 2026 via the Contracts for Difference (CfD) scheme, aimed at accelerating offshore wind development to meet the UK’s 2030 clean power targets.

Miliband’s “blitz” involves Allocation Round Seven (AR7) of CfD auctions, awarding contracts to six new offshore wind farms (including others beyond Hornsea 4). Key changes:

Strike Price: Developers are guaranteed a minimum of about £95 per megawatt-hour (MWh) for generated power—up from roughly £85/MWh in prior rounds. If wholesale market prices fall below this (which they often do, averaging around £50-£60/MWh lately), the government covers the difference.

Contract Length: Extended from 15 to 20 years, providing longer-term revenue certainty.

Total Cost: The Department for Energy Security and Net Zero estimates these subsidies could reach up to £1.8 billion annually by 2032-33 as projects ramp up. Overall CfD spending on renewables is projected by the Office for Budget Responsibility to climb from £2.3 billion currently to around £6 billion by decade’s end.

Funding Mechanism: Not direct taxpayer money, but via levies added to consumer and business energy bills. Critics argue this could add £10-£20 per household annually, though proponents say it avoids higher long-term fossil fuel volatility and supports energy security.

Ørsted cited rising construction costs, supply chain issues, and lower-than-expected wholesale prices as reasons for the initial cancellation. The higher subsidies address these, making the math work for investors. Miliband has framed it as essential for decarbonizing the grid by 2030, creating jobs (potentially thousands in supply chains), and reducing reliance on imported gas.

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Orsted will resubmit plans for Hornsea 4, a project it cancelled last year because the grants on offer were too low

A Danish energy giant has revived plans for a massive North Sea wind farm after Ed Miliband promised billions more in subsidies. The Telegraph has the story.

Ørsted, the world’s largest wind farm operator, said it would resubmit plans for the Hornsea 4 wind farm off the east of England next year after Mr Miliband offered a much higher subsidy for the power generated.

The group blew a hole in the Energy Secretary’s net zero hopes last year by cancelling the project. It said government-backed grants under the Contracts for Difference (CfD) scheme were too low.

Mr Miliband last month announced plans to boost the annual subsidies on offer, promising them minimum average prices of £95 per megawatt hour, which is about £10 more than Ørsted would have received under a prior deal.

Another decision by Mr Miliband means the contracts guaranteeing the payments, estimated by the energy department to cost up to £1.8bn a year, were also extended from 15 years to 20 years.

Hornsea 4 is a 180-turbine project off the coasts of Norfolk and Yorkshire. It would have a capacity of 2.4 gigawatts, among the largest ever built, generating enough power for 2.6 million homes on a windy day.

Ørsted’s rethink will be welcomed by Mr Miliband. When he originally approved the project, he heralded it as a key step towards decarbonising Britain’s electricity grid by 2030.

At the time, the Government had guaranteed developers £85 per megawatt hour as a minimum price for any power generated.

Wholesale power is usually well below this price, so the Government makes up the difference, funding the costs via a levy on consumer and business bills.

At the time it was widely predicted across the energy industry that the price would have to rise, or Mr Miliband’s 2030 target would never be met.

That belief prompted some developers to hold back schemes in the hope of getting extra subsidy – a view that has since proven to be correct.

The Office for Budget Responsibility predicts that the cost of CfD contracts for renewable generators are set to rise from £2.3bn to around £6bn by the end of the decade once the cost of new wind farms is included. All such costs will be met via a levy on power bills.

Read the full story here.