Ørsted Receives Favorable Tax Opinion on Two UK Offshore Wind Farms
Danish offshore wind developer Ørsted has received a favorable tax opinion from an EU advisory commission regarding its Walney Extension and Hornsea 1 projects in the United Kingdom. The ruling confirms that these projects should be taxed primarily in the UK, where they operate and generate revenue. This decision supports Ørsted’s existing tax strategy for cross-border offshore wind farms and reduces the risk of double taxation between Denmark and the UK. The dispute over how to allocate tax rights began in 2015 when Ørsted sought clarity from Danish and British authorities, but no agreement was reached until an advisory commission was established under the EU Arbitration Convention. The outcome is expected to have limited direct financial impact on Ørsted due to existing provisions for uncertain tax positions. However, it could serve as a precedent for resolving similar disputes across other offshore wind projects. The ruling provides greater certainty in cross-border taxation and may help reduce financial uncertainty for Ørsted’s UK portfolio at a time when European offshore developers face increased scrutiny over project economics and regulatory frameworks.
Topics: international taxation offshore wind Ørsted UK tax law