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Wind power in Denmark

General

The importance of energy independence in Denmark is underlined in the government plan ‘A Visionary Danish Energy Policy’ (January 2007) in which also the importance of renewable energy sources is stressed. Denmark is known for its high penetration rates of wind power in the electricity systems that locally may result in overcapacity during certain time-frames. Heat supply through distribution networks is common practice in Denmark. The major developments of the district heat sector took place in the 1980s and 1990s, focusing on cogeneration of electricity and heat. According to the present policy Denmark should have at least 30% energy supply from renewable energy in 2025, which corresponds to a wind power production of around 50% of electricity consumption.

According to the Directive 2009/28/EC of the European Parliament and of the Council on the promotion of the use of energy from renewable sources the target for the share of energy from renewable sources in gross final consumption of energy in the year 2020 for Denmark is 30% (in the year 2005 the share was 17.0%). The Directive has a mandatory 10 % target for transport to be achieved by all Member States, which refers to renewable sources as a whole, not biofuels alone.

Renewable energy projections according to the National Renewable Energy Action Plan for Denmark   
   
The National Renewable Energy Action Plan (NREAP) for Denmark was submitted in July 2010. The target according to Annex I of Directive 2009/28/EC is 30% for the year 2020 and the projected NREAP share in that year exactly matches the target.  According to the projection, the most important contribution in the year 2020 is expected from biomass (renewable heating and cooling) (2643 ktoe, 54% of all renewable energy). Second important contribution is expected from wind power (11.7 TWh or 1007 ktoe, 20% of all renewable energy). The third largest contribution is from biomass (renewable electricity) (8.8 TWh or 761 ktoe, 15% of all renewable energy). Wind power contributes with 4.0 GW (11.7 TWh) in the year 2020 (onshore wind 2.6 GW and 6.4 TWh, offshore wind 1.3 GW and 5.3 TWh). For solar photovoltaic the 2020 contribution is projected to be 0.0 GW (0.0 TWh). For solar thermal the 2020 contribution is projected to be 16 ktoe. The two most important biofuels are projected to contribute 167 ktoe (biodiesel) and 94 ktoe (bioethanol / bio-ETBE) by 2020. The renewable electricity production from solid biomass amounts to 6.3 TWh (546 ktoe) and for biogas it is expected to be 2.5 TWh (214 ktoe). The consumption of renewable heat is expected to amount to 2470 ktoe for solid biomass and 165 ktoe for biogas.    

Renewable Electricity: wind power

Denmark promotes the generation of electricity from renewable sources through a price regulation, according to the "Law on the promotion of renewable energy, 27 December 2008". System operators receive a variable bonus on top of the market price. The sum of the bonus and the market price shall not exceed a certain statutory maximum, which depends on the date of connection of the system and the source of energy used. In certain cases, system operators are granted a guaranteed bonus and are thus not subject to a statutory maximum. If the market price exceeds the total amount specified by statutory law, the exceeding amount will be deducted from future bonus payments. The period of payment is usually 10 years. The maximum period of payment is 20 years. The costs of the promotion system are borne by the consumers.

As part of the Danish energy policy 2008-2011, the renewable energy initiatives include increasing the deployment of wind turbines both on land and offshore. From 2008 to 2012 800 MW new offshore capacity, and 500 MW onshore wind power capacity is accepted by the Parliament. Consequently the wind power share of electricity consumption is supposed to be close to 30% in 2012.

Subsidies for wind power

Subsidies for wind power in Denmark depend on the date of grid connection and the age of the turbine. No difference exists between private and commercial players. The text below refers to tariffs, being the sum of market price and subsidy. The market price for electricity is defined as the spot market price at Nord Pool in the area the turbine is connected.

Onshore wind turbines connected to the grid after February 2008 will receive the Nord Pool market price plus 3.3 €cents/kWh for 22,000 full load hours (approximately 10 years), plus 0.4 €cents/kWh to cover "balancing costs" plus 0.06 €cents/kWh from the "green fund" (the latter providing specific support to co-operatives for the costs in the relatively risky and expensive pre-investment examination phase). Wind turbine owners will effectively receive 3.7 €cents/kWh. On top of this, removal of an old wind turbine, with a capacity of 450 kW or less, will net the owner 1.2 €cents/kWh for around six years. With the present prices at the Nord Pool spot market this will result in a total price per kWh of 8-10 €cents/kWh for new onshore wind turbines.

Wind turbines connected to the grid before February 2008 are subject to different tariffs depending on the applicable law at the time of grid connection.

For construction of off-shore wind farms permits are required. The permits are subject to decision by the Minister of Climate and Energy after tendering or application.

For urban turbines having a capacity of 25 kW or less, which are connected to the grid via the consumption installation, the system operator will sell the surplus production on the spot market. A subsidy together with the market price ensures a tariff of 8.0 €cents/kWh.

Schemes for expansion the wind power capacity

 

The "Law on the promotion of renewable energy, 27 December 2008" introduced four new schemes for the promotion of expansion using wind turbines:

·         Loss of value of property due to the erection of wind turbines (for neighbours to wind turbines).

·         Model for local ownership through purchasing rights to wind turbines for local inhabitants.

·         A Green plan for reinforcing local countryside and recreational values.

·         A guarantee scheme for financing preliminary investigations by local wind turbine associations etc.

 

In 2010 the Danish government decided on the construction of a national test centre at Østerild for large wind turbines of up to 250 metres in height (20 MW), to give the wind turbine industry and research institutions the optimum opportunity for staying ahead.

Future programme changes expected
No information on future policy.

Sources
Danish Energy Agency, www.ens.dk

World Wind Energy Association, Wind Energy International 2007/2008, http://www.wwindea.org, October 2007

Directive 2009/28/EC of the European Parliament and of the Council of 23 April 2009 on the promotion of the use of energy from renewable sources, http://ec.europa.eu/energy/renewables/transparency_platform_en.htm

 

Legal sources on renewable energy: http://res-legal.eu (sourced October 2009)

World Wind Energy Association (WWEA): World wind energy international 2009/2010, ISBN: 978-3-940683-01-4

The National Renewable Energy Action Plans (NREAPs) are all published on the Transparency Platform on Renewable Energy: http://ec.europa.eu/energy/renewables/transparency_platform/action_plan_en.htm
(sourced July 2010 - January 2011)   
   
Renewable Energy Projections as Published in the National Renewable Energy Action Plans of the European Member States, http://www.ecn.nl/nreap
(sourced December 2010)   

Interactive EurObserv’ER Database
http://www.eurobserv-er.org
Last update: January 2011


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