Historic Offshore Wind Agreement Fuels Denmark’s Green Transition
The agreement promises to generate significant volumes of affordable green electricity within just seven years, signaling a new era of green opportunities for the country. The agreement involves a decision on 20% state ownership in the offshore wind farms as well as establishment of minimum criteria on sustainability and social criteria as well as mandatory monitoring of nature impacts and establishment of a Marine Nature Fund.
Currently, the combined capacity of all offshore wind turbines in Danish waters is 2.3 GW, a total achieved over 32 years. This agreement adds up to 14 GW to this capacity through state tenders in the next seven years, a six-fold increase.
Kristian Jensen, CEO of Green Power Denmark and former Foreign Minister and Finance Minister of Denmark, comments.
“This is a historic and remarkable agreement. We’re poised to produce a wealth of green electricity, enough to cater to our domestic needs. Moreover, this agreement sets us on a path to become a net exporter of affordable, climate-friendly energy, signifying the extension of our green efforts beyond national borders.”
The agreement sets forth the framework for the upcoming tenders, boasting several key features.
“A large, consolidated tender for the wind turbines is planned, aiming to streamline the process and ensure the wind turbines are installed swiftly and efficiently” Jensen remarks.
He continues, “The wind turbines we’re setting up will span extensive maritime areas, supplying green energy for the next three to four decades. We’ve advocated for the creation of a robust maritime nature fund, capable of fostering sustainable coexistence between nature and wind turbines. We are pleased that Denmark is showing leadership in this area.”
The state’s 20% ownership in the upcoming offshore wind farms is an untested approach globally, and Green Power Denmark had previously expressed concerns over this element of the agreement.
Fortunately, most of the concerns have been addressed. The state’s stake has been decreased from the initial government proposal, thus creating a clear separation between the government-run enterprise and the political echelons. Measures are being taken to prevent any potential delays in the construction process.
“The response of investors and developers to the state’s role as a stakeholder will be interesting” states Jensen.
The political agreement is dual-faceted. One part specifies the tendering of 6 GW of offshore wind turbines in the North Sea and Kattegat.. The other part pertains to 3 GW of offshore wind turbines associated with Energy Island Bornholm in the Baltic Sea.
The possibility of reaching a total of 14 GW stems from the provision allowing the winners of the tenders to install additional turbines, if deemed feasible. This strategy is commonly referred to as “overplanting”.
The decision regarding Energy Island Bornholm has been complex, primarily due to the high cost of establishing an interconnector. The goal is to link the energy island with Germany and Zealand, a venture the government estimates will require DKK 17.6 billion (approx. €2.37 billion).
“Deciding to proceed with the Energy Island Bornholm plans was a complicated decision, particularly due to the cost of the interconnector. However, Energy Island Bornholm is crucial to our energy infrastructure and security of supply. It is projected to bring down electricity prices and strengthen the ties between the Danish and German electricity markets. It’s a wise investment in the long run” Jensen concludes.
You should consider reading
Indian wind market on the rise: Need for Danish knowhow and solutions28 September 2023
H2RES: State-of-the-art-green hydrogen production2 August 2022
Green hydrogen is Danish hydrogen19 September 2023
Why Danish hydrogen is green hydrogen18 September 2023
Towards 100% renewable electricity production18 September 2023