Policies in Denmark

Denmark has for many years supported electricity production from renewable energy sources through various support schemes. In recent years, a shift has been made from technology specific support to a higher degree of technology neutrality and a more marked based approach through e.g., multi-technology tenders. Support for certain technologies has also been phased out recently. This includes biomass, where a premium tariff scheme was phased out in 2019 (but remains for depreciated installations) and biogas, where a scheme including direct grants for end-users was phased out in 2020. Concerning biogas, it was however later decided to introduce a new subsidy tender for biogas and other green gasses in the period 2024-2030. This has not yet been adopted (NECP Denmark, 2019; Climate Agreement 2020).
In the 2018 Energy Agreement the Danish Parliament agreed to aim for a renewable share of total energy consumption of approximately 55% in 2030. This is expected to result in a renewable share in electricity above 100% of consumption by 2030 (NECP Denmark, 2019).

• Loan (loan guarantees for local projects) - guarantees for loans for local owner associations and initiative groups wishing to establish certain RES installations
• Premium tariff (test wind turbines and depreciated biomass installations) – support through a premium tariff for test wind turbines within and outside national test centres and for depreciated biomass installations. A premium tariff scheme for biomass in general was phased out in 2019.
• Tenders (offshore wind farms) - site- and size-specific tenders for offshore wind farms decided in broad political agreements.
• Tenders (technology neutral) – tenders covering offshore wind established following an unsolicited application procedure, onshore wind, solar PV, wave power and hydroelectric power.
• Net-Metering – exemption from certain public tariffs and electricity tax on the electricity produced and consumed within one hour.

DEA

In Denmark, heat production from renewable energy sources is generally supported by the absence of energy tax and CO2 tax which is levied on fossil fuels.
Further, several subsidy schemes support the deployment of heat pumps both for district heating production and for individual heating. Besides the three schemes covered below that directly support deployment of heat pumps, the so-called scrapping scheme and decoupling scheme, that support scrapping of oil- and gas-burners and decoupling from the gas grid respectively, also promote heat pumps and other renewable technologies by subsidising termination of the use of fossil alternatives.
Support for other specific technologies until recently included a scheme with direct grants for end-users of biogas including for heat production. This was phased out in 2020, but it was later decided to introduce a new subsidy tender for biogas and other green gasses in the period 2024-2030. This has not yet been adopted (NECP Denmark, 2019; Climate Agreement 2020).
Denmark expects the renewables share in the heating and cooling sector to increase from 53.5 % in 2020 to 59.9 % in 2030. This share is expected to be achieved mainly through the use of biomass and heat pumps (NECP Denmark, 2019).

• Subsidy (heat pumps) – three different schemes support the deployment of heat pumps both for district heating production and for individual heating
• Tax regulation mechanism (absence of energy tax and CO2 tax) – The energy tax does not cover biomass for heat production and the CO2 tax only applies to fossil fuels

• DEA
• DTA

In Denmark, the support schemes for RES-T focuses on reducing taxes for zero and low emissions transport as well as mandating that biofuel is mixed in with conventional fuels.
Denmark has set a general goal of a reduction of greenhouse gas emissions of 70% by 2030. For the RES-T sector, Denmark expects to phase out new purchases of fossil fuel-based cars by 2030. It is expected that by 2030, 19% of the energy consumption in the transport sector will be from renewable sources. (NECP Denmark, 2019)

• Biofuel quota – For petrol and diesel fuels, at least 7.6% of the volume must be biofuels and the total greenhouse gas output for fuels must be reduced by 6% (compared to 2010 levels).
• Electricity tax reduction for charging EVs – The electricity tax is reduced for charging EVs at corporate premises.
• Reformed vehicle registration tax – The registration tax for new vehicles is reduced, but a second charge is applied to petrol or diesel-driven vehicles and to plug-in hybrid vehicles at a reduced rate. Until 2030, the tax reduction is gradually tapered off.

• DTA
• DEA
• DRA