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National Energy and Climate Plan: Denmark

Explore Denmark's center-right government's market-oriented energy approach, renewable energy targets, taxation reductions, technology-neutral tender processes, and upcoming climate agreements.

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National Energy and Climate Plan: Denmark

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  1. National Energy and Climate Plan: Denmark Jay Sterling Gregg 8 May 2019

  2. Summary • Center-right government seeks a more market-oriented approach • Energy agreement reached in 2018 • Maintained pledge for carbon neutrality by 2050 • Renewable energy target of 50-55% by 2030 • Scrapage of onshore wind in favor of offshore development • Technology neutral tender process • Reduction of electricity taxes • Tech export focus • Climate agreement forthcoming, likely after election

  3. Recent Developments Klimaaftale ??? April 2018 June 2018 October 2018 ?

  4. Energy for a green DenmarkApril 2018 • Push for a more market oriented, competition-based approach over “inflexible” energy planning • Tax reforms, uniform subsides on all technologies • Elimination of house-hold based subsidies • Emphasis on offshore wind development in North Sea (w/o subsides, through tender)

  5. Energy Agreement June 2018 • 50% Renewable Energy by 2050 • 3 offshore wind parks: 2400 MW • Technology neutral tender process • Funding for biogas, energy savings, renewables, and green transportation • Reduction of electricity and heating taxes

  6. Together for a greener futureOctober 2018 • 38 initiatives • Shipping and transport- • timetable to phase out new petrol and diesel buses, cars, and hybrids; • 40% reduction in per tonne CO2 in shipping 2008 vs. 2030 • Agriculture • Promotion of precision farming • Climate friendly pork production • Buildings • Double exports of clean air technologies • Biological and technological CCS • Climate labelling on goods, foods, and services

  7. Upcoming • Election • Climate agreement • Transportation plan • Agriculture / Sustainable biofuel plan?

  8. 2019 election Gallup poll: Climate change and the environment is the voters’ top priority

  9. NECPDecember 2018 • More detailed proposals and policies for Renewable Energy deployment, the energy market, and R&D funding • Less detail in policies for greenhouse gas reductions, energy efficiency, energy security • Some sector-specific targets

  10. Dimension: DecarbonizationGreenhouse Gases Objectives & Targets Policies many polices (taxes, regulations, labelling, landuse, agreements, etc.) related to emissions The transition to come through the (forthcoming) Danish climate policy. • Carbon neutral by 2050

  11. Dimension: DecarbonizationRenewable Energy Objectives & Targets Policies Phase out of coal by 2030 in electricity sector 3 new 8MW offshore wind parks (total 2,400 MW). 2019/20, 2021, 2023 reduce the number of land based wind turbines from approx. 4,300 today to maximum 1,850 in 2030 • 55% R.E. by 2030 • With current polices, DK is on track to achieve 48% R.E. by 2030. • R.E. within electricity sector is expected to exceed 100% by 2030. • 90% non-fossil heating by 2030

  12. Dimension Energy Efficiency Objectives & Targets Policies Ministries are at liberty to pursue the instruments most cost effective in their particular circumstances, including deep renovations, behavioural measures etc. Energy Savings Obligation: Voluntary agreement between Danish companies and Ministry of Energy, Utilities and Climate Information campaign • Currently lowest energy intensity of GDP in EU • 2020: Reduction of gross energy consumption by 16.9% from 2006 levels • 2020: Reduction of final energy consumption 7.7% from 2006 levels. • 2020 Targets: • 707.2 PJ Gross • 615.5 PJ Final

  13. Dimension Energy Security Objectives & Targets Policies Cybersecurity plan (in cooperation with private companies) Risk assessment groups with Nordic/ Baltic countries. Legal agreements with Germany and Sweden forthcoming • No national objectives for reducing energy imports (dependencies are limited due to diversification of energy sources and the production of oil and gas within Denmark). • Net exporter of gas since 1984 • Gas will be 12% of domestic energy mix by 2030

  14. Dimension Internal Energy Market Objectives & Targets Policies Danish TSO (transmission system operator) shall procure all energy and non-energy services through market-based mechanisms. Non household-scale RE producers are obliged to sell their production into the market New renewable energy production cannot receive subsidies in hours with negative market prices Break up of vertically integrated monopolies Smart meters to all consumers by 2020, dynamic pricing for small customers • Interconnectivity (= import interconnection/ net generation capacity) currently at 50.6%; no further goals, though interconnection projects to UK (electricity), Germany (electricity), & Poland (gas) are planned. • Private self-generation is not a particular objective

  15. Dimension Research, Innovation, and Competitiveness Objectives & Targets Policies Double public funding for R&D to € 78 mil in 2020. € 134 mil on energy & climate research and development by 2024. € 67 mil over 2020-2024 for green transport solutions € 8 mil to smart energy test facilities • No research funding earmarked for the Energy Union • No target for specific tech deployment • Double exports of energy tech and services from 2015 to 2030

  16. Sectors

  17. Electricity & Heat • A roadmap for smart energy • “Significant” increase in heat pumps • Smart meters and dynamic pricing to all consumers by 2020 • Emphasis on solar PV and wind, also solid biomass to convert of coal power plants • Technology-neutral RES tenders 2020-2024. • Tenders for offshore wind: contracts signed 2019: 400 MW, 2020: 350 MW, and 2021: 600 MW. • Additional tenders for three offshore wind parks: 2,400 MW have also been decided. • Tenders for solar PV installations less than 1 MW • Future potential for wave and hydropower technologies • Phase out of PSOs (public service obligations) to finance support for RE • Reduce the electrical heating tax by from € 0.04/kWh to € 0.02/kWh, effective 2021. Reduces cost to that of fossil energy / wood heating. • General electricity tax reduced from €0.123/kWh today to €0.104/kWh in 2025. Electricity tax reduced to EU minimum for some businesses.

  18. Buildings • a long-term renovation strategy for existing buildings is being developed. This strategy will include indicative milestones for building renovation for 2030, 2040 and 2050. • Electricity for self-consumption is exempt from electricity tax (however, feed-in tariff is rather low, variable, and has a price ceiling)

  19. Transformation • Biogas certificates for biomethane • €32 mil/year over 20 years to continue support for biogas and other types of green gas. • €19 mil/year to support the production of advanced biofuel – undecided how to allocate this yet • From 2020, €13.4 mil/year to support use of waste heat • Electricity and heat from solid biomass: 1) Non-depreciated installations: continued fixed premium of 2 € cent/kWh 2) Depreciated installation: fixed premium, difference in operating cost in using biomass compared to alternative fossil reference. 3) New installations: a grant pool is established, which would give the possibility of aid for new capacity for the production of electricity using biomass, biogas and other green gasses after application.

  20. Transport • Target: over 1 million “green cars” by 2030 • No 2019-2020 vehicle registration tax on green cars under €53,500 • New busses CO2 neutral by 2020 • Phase out of new petrol and diesel cars by 2030 • Phase out of new plug-in hybrids by 2035 • 5.75% biofuel blend requirement for transport fuels • 2020: 0.9% blend of advanced biofuels • Parking and bus lane incentives for green cars

  21. Agriculture • Bioenergy sustainability policy under development with NSEC (North Sea Energy Cooperation) and AGFE (Working Group for Renewable Energy) in anticipation for the EU REDII (Renewable Energy Directive)

  22. (VAT registered businesses)

  23. Analysis by DTU: http://www.klimaaftalen.tokni.com/tab2

  24. Analysis by DTU: http://www.klimaaftalen.tokni.com/tab2

  25. Projected impact WEM = baseline with existing EU and National policies WAM = with additional measures

  26. Summary (reiterated) • Market-oriented approach • Ambitious pledges for renewable energy and GHG reductions • Maintained pledge for carbon neutrality by 2050 • Renewable energy target of 50% by 2030 • Lacking detail in specific measures • Climate agreement forthcoming, likely after election

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