Ørsted Gets Favorable Tax Opinion on Two UK Offshore Wind Farms

Ørsted Gets Favorable Tax Opinion on Two UK Offshore Wind Farms

Charles Kennedy

Fri, September 11, 2026 at 5:30 AM GMT+3 2 min read

• ORSTED.CO -0.18%

Danish offshore wind giant Ørsted has received a final opinion supporting its approach to the taxation of two major UK offshore wind farms, potentially providing a framework for resolving similar disputes involving other projects.

An advisory commission established under the EU Arbitration Convention concluded that Walney Extension and Hornsea 1 have genuine legal and economic purposes and should therefore be taxed primarily in the country where the projects are located.

For the two wind farms, that means taxation principally falls to the UK over the projects' operating lives as they generate electricity and revenue.

The opinion is significant for Ørsted because it broadly validates the tax principles the company has used for the projects and addresses the risk of the same income being taxed in both Denmark and the UK.

The dispute stretches back more than a decade. Ørsted approached the Danish Tax Agency and Britain's HM Revenue & Customs in 2015 seeking clarification over how taxation rights should be divided between the two countries. After the authorities failed to reach an agreement, the matter was referred to an advisory commission in 2023.

Ørsted said the outcome will result in a small upward adjustment to its Danish tax position, including associated interest. The company said the amount is already covered by provisions made for uncertain tax positions and is expected to be largely offset over time by lower taxes in the UK.

The financial impact therefore appears limited, while the wider significance may lie in how the opinion is applied to other Ørsted offshore wind projects facing similar Danish tax assessments.

Ørsted said it will now discuss those projects with the Danish Tax Agency and expects any resolution to follow the same principles established in the Walney Extension and Hornsea 1 case. It will also hold discussions with HMRC over implementation of the opinion.

The decision comes as offshore wind developers across Europe face heightened scrutiny over project economics, financing costs and regulatory frameworks. Greater certainty over cross-border taxation could reduce another area of financial uncertainty for Ørsted's UK offshore wind portfolio.

Ørsted has 11 GW of installed offshore wind capacity globally and another 7.2 GW under construction. The Danish group reported operating profit excluding new partnerships and cancellation fees of DKK 25.1 billion in 2025.

By Charles Kennedy for Oilprice.com

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