It would be a real bombshell in the district heating sector if it were to happen, and now it has become a reality. Six Jutland consumer-owned district heating companies are not allowed to include millions in losses from speculation in consumers' heating prices. At the same time, an amount of millions must be refunded to consumers. This is what Energiwatch writes.
The Danish Utilities Authority confirms this in its final decision, whereby the six district heating companies must recover the millions lost in other ways.
"The Danish Utilities Authority decides that the losses incurred as a result of the agreements in question cannot be considered necessary expenses that can be included in the heating price," it is clear from six identical decisions.
Must pay over 40 million DKK back
These are the district heating companies Oksbøl Varmeværk, Sdr. Herreds Kraftvarmeværk, Snedsted Varmeværk, Hirtshals Fjernvarme, Vildbjerg Varmeværk and Veddum-Skelund-Visborg Kraftvarmeværk.
Together, the six district heating companies have lost a total of DKK 44.6 million as a result of the bankruptcy of Dansk Kraftvarme Kapacitet (DKVK). They have included part of this amount in the heating price, which must now be paid back to consumers, the decision states.
Only the amounts differ among the six decisions. In the case of Snedsted Varmeværk, which lost DKK 7.7 million DKK in connection with the bankruptcy, the decision reads:
"That Snedsted Varmeværk must, as a consequence, return DKK 2,304,754 to the heating customers, which has already been collected for the period 2018-2022, and also return what may have been collected in the budget for 2023 in the case."
Millions lost on speculation in electricity prices
The case stems from the bankrupt company DKVK, through which the district heating companies speculated in the period 2018-2021 that electricity prices would remain at a low level. However, DKVK went bankrupt when electricity prices exploded in the second half of 2021.
This left the six consumer-owned district heating companies and the municipally owned Silkeborg Forsyning with a bill of over DKK 100 million. DKK. However, Silkeborg Forsyning has not been involved in the Danish Utilities Authority's work in this case.
With the announcement, the Danish Utilities Authority cements its preliminary decision from September. As a result of the decision from then, the six district heating companies warned that it could have extensive consequences for the industry as a whole.
- It is brave if they stand by the decision, because it is a bomb under the district heating industry as a whole, Oksbøl Varmeværk's chairman, Erhardt Jull, told EnergiWatch in November.
How the money will be recovered, if it cannot be through consumers' heating prices, is unknown.
- We are a consumer-owned company, and everything the company has earned has gone to the consumers. This is the concept of a consumer-owned company, so the company has no equity, pointed out Anders Andersen, operations manager and chairman of Veddum-Skelund-Visborg Cogeneration Plant, in November.
The Danish Energy Regulatory Authority further writes in its final decision that no decision has been taken on the plants' participation as cooperative members in DKVK.
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