Policy status:Unknown
Policy Type:
Policy Target:
Description:Power utilities are obliged to purchase the electricity from "small-scale" CHP plants (plants outside the centrally supplied areas, not connected to a district heating network and rarely exceeding an electrical capacity of 1 MW) . The feed-in tariffs equal the purchasing utilitys own long-term marginal cost (avoided cost). Danish electricity feed-in tariffs are based on a three-tier tariff system, with tariffs reflecting electricity demand patterns (low, medium and high tariff periods). The main fuels used in small-scale CHP are natural gas and waste and, to a lesser extent, biogas and other biomass. Heat prices from small-scale CHP are very sensitive to variations in the gas price, but less sensitive to changes in interest rates and investment costs. As a result of the support measures, the capacity of local CHP was 3.4 times as high in 2000 as it was in 1993, whereas "central" power capacity remained stable. Small-scale CHP also received government support through a 1986 Parliamentary decision, adopted by the power utilities, to establish 450 MWe of small-scale CHP using indigenous fuels (natural gas, waste, biogas or biomass). In connection with the presentation of the Energy 2000 plan in 1990, a more ambitious programme for small-scale CHP was put forward. To accelerate the establishment of small-scale CHP, a state subsidy was introduced in 1992 for power production from waste incineration, natural gas and renewables used in small CHP plants. The subsidy originally amounted to 10 øre per kWh but has been reduced to 7 øre per kWh, except for plants smaller than 3 MW.

Last modified: Wed, 29 Aug 2012 14:21:58 CEST