The government closes the so-called open door scheme. This is what the Ministry of Climate, Energy and Supply writes in a press release.
The open door scheme - subsidy-free offshore wind - is a model where companies can apply to be allocated offshore areas without payment. In return, they themselves must bear all costs for the development and construction of the project.
In the Danish energy industry, it was received with shock when the authorities put the open door scheme on hold on 6 February 2023. The scheme was put on hold as it could be in breach of EU law.
Climate, Energy and Supply Minister Lars Aagaard (M) had otherwise hoped that the scheme could continue with some adjustments so that it complies with the EU rules for state aid.
- The scheme was put on hold because officials said it was in breach of EU rules. It turned out to be true. We have then worked to get as many open door projects as possible through. But since we cannot make an adjusted arrangement, we will stop, says Aagaard.
Rejection of three applications
According to the ministry, it has not proved possible to adjust the open door scheme within the framework of EU regulation in a way that would result in faster offshore wind expansion.
According to the ministry, following Tuesday's announcement, the Danish Energy Agency will now reject the three remaining applications at Vikinge Banke, Kadet Banke and Paludan Flak. Next, the open door scheme will be closed by law.
However, case processing continues on the open door projects which are well advanced and which have already received permits "in a different market situation, for lifetime extensions and for permits for repowering and testing".
The minister is taking the closure of the open door scheme quite calmly.
- We have objectives to produce more green electricity in Denmark than we ourselves will use. Towards 2030, it has been agreed to enable enough green power for approximately 30 million Danish and European households, says Aagaard.
The government and a broad majority in the Folketing entered into an agreement in May, among other things, on how Denmark's power from offshore wind turbines can be multiplied. In the agreement, the parties have agreed on the framework for tendering offshore wind farms with a total of 9 gigawatts of power. Potentially it could be 14 GW or more.
DI not impressed
Dansk Industri (DI) represents the companies that have had their applications rejected in the open door scheme. DI's political director, Emil Fannikke Kiærs, is not impressed.
- The last three offshore wind projects could together supply Danish companies and households with 2 GW of green energy. Today we get 2.3 GW from offshore wind, so it is almost a doubling that we are missing out on, which could have accelerated Denmark's green transition, he says in a written comment.
Dansk Erhverv calls it "sad news" that the scheme is closing.
- In Dansk Erhverv we must now look forward and hope that the government will work to ensure that a new market-based scheme for offshore wind can be established as soon as possible. Because we need all the green energy we can make if we are to transition from Russian gas and meet our climate goals, says head of department for energy Esben Thietje Mortensen in a written comment.
Frustrating chapter
According to the industry organization Green Power Denmark, "a frustrating chapter in Danish offshore wind history" is now being put to rest.
- The companies were otherwise ready to invest in offshore wind turbines at no cost to the state, and they had applied in accordance with current regulations. Now it's all shut down, and thus consumers are missing out on very large amounts of cheap, green electricity, says Thomas Aarestrup Jepsen, director of renewable energy production at Green Power Denmark, in a written comment.
On Wednesday, it is planned that Aagaard, Foreign Minister Lars Løkke Rasmussen (M) and Business Minister Morten Bødskov (S) will have an open consultation about the open door scheme.
/ritzau/
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