One of the UK's largest planned offshore wind farms has been canceled by its developer Danish wind energy company Ørsted due to higher costs and greater risks.

Phase 4 of the giant corner wind development near the Yorkshire coast is expected to include 180 giant turbines capable of generating the equivalent of enough green electricity to reach one million homes.

However, Rasmus Errboe, CEO of Ørsted, said in a statement to investors: "The project's expected value for the project reduces the project's expected value, with rising supply chain costs, higher interest rates and increased execution risks."

As a result, the company is expected to incur separation costs of 3.5 billion to 4.5 billion Denmark Krona (£399 million to £513 million).

The final investment decision for the project will expire later this year.

The cancellation is Ørsted's latest financial blow, which forced it to cancel two major wind developments on the northeastern coast of the United States at a cost of £300 million and cut hundreds of jobs.

The company is the majority owned by the Danish government and has previously undertaken other plans to expand its offshore wind business as the global wind industry faces rising costs.

Developers have been facing increased costs, caused by inflation and rising interest rates, as well as problems in the global offshore wind supply chain.

ØRSTED said on Wednesday that the wind energy industry “faces headwind challenges related to supply chain, regulation and macroeconomic development in the near term.”

Since taking office in January, U.S. President Donald Trump has expressed strong opposition to sea winds.

However, Ørsted said the long-term outlook at sea “because of growing global electricity demand, enhanced energy security and affordability through renewable energy and enhanced framework conditions in several major markets”.

The Hornsea 4 project received the green light from the last government in July 2023. With a capacity of 2.6GW, it is the second largest wind power, and the second largest wind approved by the government, second only to the Hornsea 3 project, which has a capacity of 2.8GW and is expected to be completed in 2027.

The first two stages of horn development have been run.

ØRSTED's latest project cancellation comes after the company's turbulent time, which led to the implementation of the restructuring plan in 2024, while it canceled dividend expenses from shareholders for fiscal year 2023-25 ​​to strengthen financial position. Since its peak in 2021, its market value has dropped by about 80%.

Hornsea 4 cancelled because the company reported higher-than-expected first-quarter operating profit.

At the time of construction, the Hornsea 2 was the world's highest-capacity offshore wind. It generates enough energy to power over 1.4 million homes and covers 178 square miles of area.