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Wind and solar power to battle in first-ever technology-neutral tender in Denmark

State of Green
By State of Green, September 27, 2018

Today, Danish energy policy is making history as wind turbine and solar cell projects for the first time ever in Denmark are given the opportunity to bid in a technology-neutral tender, competing for delivering as much green power for the money as possible.

On 27 September, the Danish Ministry of Energy, Utilities and Climate will initiate the first technology-neutral supply of wind and solar ever in Denmark. Thus, onshore wind turbines, solar panels and open-door offshore wind turbines will be competing for access to subsidies for a total of EUR 113 million corresponding to approx. 140 MW. The Ministry expects the 140 MW to cover more than 100,000 households’ annual power consumption. By comparison, during the last five years Denmark saw an average of 252 MW of wind power installed each year.

The bidding round is open from 27 September to 26 November, and the final result is expected to be presented in early December.

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“It is a big day for Danish energy politics. For the first time ever, the technologies will compete to deliver as much green energy for the money as possible for the benefit of the whole society, and I have great faith in the wind and solar industries presenting some great bids,” said Lars Chr. Lilleholt, Minister of of Energy, Utilities and Climate.

Towards more market-based renewable energy
The previous wind turbine support scheme expired on 21 February 2018, while the open support scheme for solar cells has been discontinued. Therefore, the government and the supporting Danish People’s Party last year decided to introduce, among other things, annual technology-neutral supply of wind and solar in 2018 and 2019 for a total of EUR 113 million.

The technology-neutral tender of wind and sun in 2018 marks the first important step away from traditional, handheld and expensive support schemes and towards a more market-based approach to renewable energy support.

“The goal is that renewable energy will be able to compete on market conditions. We are not quite there yet. However, I hope that this technology-neutral tender will be a good rehearsal, which can give an idea of how far we are from the goal before launching the even bigger tenders that the Danish parliament has agreed on in the Energy Agreement,” said Lars Chr. Lilleholt.

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This technology-neutral tender of wind and solar is the first of two such tenders. Tender number two will be in 2019, and it will include a larger amount of money, namely EUR 80 million.

The next important steps in the direction of a subsidy-free future for renewable energy have already been taken with the Energy Agreement of 29 June 2018, where a unified parliament decided, among other things, to allocate a total of EUR 523 million for renewable energy development from 2020 to 2024.

Facts

  • The tender documents are available on a procurement portal accessible via the Danish Energy Agency website.
  • Bids can be submitted in this bidding round from 27 September to 26 November 2018.
  • The decision on the technology-neutral tender is expected to be announced in December 2018.
  • In 2019, another technology-neutral bidding round for wind and solar will be opened.
  • From 2020 through 2024, the technology-neutral tenders will be expanded in both extent and size, cf. the Energy Agreement of 29 June 2018.

Source: The Ministry of Energy, Utilities and Climate (in Danish)

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