Nine out of ten prequalified players have withdrawn from the state's CCS tender of 28.7 billion DKK for CO2 capture and storage. This leaves Aalborg Portland as the only remaining bidder, and according to Dansk Fjernvarme, competition in the tender has effectively disappeared.
The industry organisation states in a press release that the lack of competition could mean that CO2 reductions become unnecessarily expensive, and therefore believes that the pool should be cancelled and the funds re-tendered on different terms.
- Right now, the CO2 reductions that can come through the CCS pool risk becoming significantly more expensive than necessary, because there is no longer a competitive parameter around which the pool is built, says Kim Mortensen, CEO of Dansk Fjernvarme.
Dansk Fjernvarme's interest in the CCS tender is not a coincidence. When the prequalified players were presented in May 2025, nine out of ten came from the district heating sector, which, among other things, operates waste-to-energy and biomass plants.
According to the industry organization, the sector has significant potential for CO2 capture, but since the prequalification, all district heating players have withdrawn from the tender. According to the organization, this is mainly due to tender conditions that have been too risky for municipally owned companies.
- The combination of market conditions and tender conditions has made it difficult to establish a CCS value chain in the time required by the fund. And the financial risk in the form of fines for not succeeding within the time frame is too great – especially when municipal owners have to balance the risk against other municipal tasks such as education, welfare and climate adaptation. It is a shame when CCS is such an important tool for climate goals and climate neutrality, says Kim Mortensen.
I would rather see more reductions than a faster timetable
The organization believes that the state should assume a greater share of the risk in a market that is still under construction, especially when access to CO2 storage is limited. At the same time, Dansk Fjernvarme suggests that the focus be directed more towards total CO2 reductions over time rather than fixed requirements for deliveries as early as 2030.
- Wouldn't it be better to have more CO2 reductions per year from 2032 than fewer per year from 2030? It is good and important that we have ambitious climate goals in Denmark, but it is the accumulated CO2 emissions into the atmosphere that matter, says Kim Mortensen.
According to Dansk Fjernvarme, the funds in the CCS pool should either be re-tendered with significantly more lenient terms, lower risk for bidders and a more realistic timeline, or the state should consider another model for supporting CCS if Denmark is to ensure the most possible CO2 reductions for the money.
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