Energi Danmark handles the balance in a ground-breaking PPA between Chr. Hansen and Better Energy

With a PPA, Chr. Hansen and Better Energy take responsibility for adding entirely new renewable energy to the Danish electricity system. Energi Danmark’s role will be to balance both the consumer and the producer as well as manage price risks and ensure Chr. Hansen’s desire to create a green balance with their consumption.

Buying sustainable energy has so far been a matter of reserving some of the energy that already existed. However, for all parties included in this agreement, there has been a desire to do even better – a desire for a solution that brings new sustainable energy to the market at a competitive price.

No price risk and a goal of 100 % green energy

In general, Energi Danmark solves two challenges associated with a traditional PPA agreement; namely, eliminating the price risk and managing the difference between consumption and production.

With this PPA agreement, we as balance responsible removes the price risk that the customer carries in a traditional PPA agreement. The price risk exists for both the consumer and the producer when consumption and production does not match, e.g. if the sun does not shine. We make sure to remove that risk while creating overview and transparency in the settlement,” says Viggo Aavang, Head of Sales at Energi Danmark and continues:   

We are very proud of this agreement. It shows that not only the large data centers can enter PPA agreements but that all types of companies and public customers can now contribute to add more new sustainable energy into the system in Denmark,” he adds.


Sustainability combined with budget security

The PPA agreement means that Chr. Hansen continues to be the world’s leader within sustainability while also ensuring budget security.

“As for Chr. Hansen, it has been essential that, in addition to adding new sustainable energy in Denmark, we can continue to achieve budget security in terms of our electricity costs. In fact, you can say that Energi Danmark, rather than buying electricity on the electricity exchange for us, buys the price hedging of Better Energy,” says Jesper Deela Nielsen, Senior Category Manager, Global Sourcing at Chr. Hansen and continues:

In addition to this agreement, we have asked Energi Danmark to create a green balance 24/7/365 based on the ordinary certificate market. Hereby, Chr. Hansen’s takes responsibility not only to supply new renewable energy to the system but also to ensure that the electricity market in the future consists of a mix of renewable energy,” concludes Jesper Deela Nielsen, Senior Category Manager, Global Sourcing at Chr. Hansen.

As a balance responsible party for both consumption and production, Energi Danmark will continue to work constructively with flexible electricity consumption and optimize supply and demand in the market for the benefit of the entire society.

“Creating more new renewable energy is the focal point in the transition to a green energy supply. The PPA agreement brings Chr. Hansen at the forefront of the transition to sustainable energy in Denmark and it paves the way for similar innovative solutions to be established for small and medium-sized companies that want to contribute positively to Denmark’s overall energy accounts,” says Peter Munck Søe-Jensen, Head of Power Production & Asset Management at Better Energy.

About author

The Energi Danmark Group is one of the Nordic region’s leading energy trading groups with activities in physical and financial energy trading, carbon and gas trading, portfolio management and associated trading in derivative financial instruments.

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Kim Nielsen

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