The citizens are paying too high a price for the district heating fiasco in Odsherred, the municipality believes. Now it wants to change the rescue plan for the ailing heating company, and is making a clear call to a major creditor.
On Monday, the Odsherred city council will meet extraordinarily to discuss the latest developments in the case of the district heating scandal in Odsherred Forsyning. There is a proposal for a repayment model for the debt of 1.5 billion kroner on the table from the reconstructors, which the politicians must decide on.
Prior to the city council meeting, the municipality's executive board has prepared a proposal to change the reconstruction plan for Odsherred Varme. The agenda shows that the municipality is proposing that the dividend – i.e. the part of the debt that the company must pay back to the creditors – be reduced from 59.18 percent. to 52 percent.
The purpose is to give the company a better chance of surviving financially over the 45-year repayment period, and at the same time ensure a heating price that customers can pay and do not flee from. Because if customers flee, the ability to pay creditors decreases, the assessment is.
As lenders, Nordea and KommuneKredit are the two largest creditors in the ailing heating company with loans of DKK 680 and DKK 583 million respectively to finance the district heating project.
In the reconstruction proposal for Odsherred Varme, citizens are faced with an average heating bill of DKK 26,011 per year excluding unit rent. This is the prerequisite for the company to be able to pay its debt.
But fundamentally, the municipality believes that the set heating price is set far too high. The administration estimates that the heating price should be reduced to DKK 24,000 per year excluding unit rent. A price above that amount will entail a very high risk that customers will do whatever they can to be disconnected from the district heating network.
The proposed amendment does not come out of the blue. Before the restructurer for Nordea, Christian Jul Madsen, took over the management of the utility company, the previous board had discussed precisely the critical point between consideration for creditors and a significant customer exodus.
Here too, the recommendation was to keep the heating price at a maximum of DKK 24,000, as the proportion of customers who have lapsed could otherwise undermine the company's finances and thus its ability to survive.
"A lower heating price creates a better basis for retaining current customers and attracting new ones, according to the recommendation to the city council.
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