Energy Strategy 2050 – from coal, oil and gas

A greater use of biomass
Background The government will
Biomass has the potential to replace large amounts of
coal and natural gas cost-effectively in the relatively short
term. In the long term, conversion from fossil fuels to
renewable energy outside Denmark can lead to pressure
on biomass resources and thus rising prices, and possible
challenges to security of supply. On the other hand,
it must be anticipated that the technologies used in the
production of biomass and biofuels will undergo developments
which can lower the price of energy produced
from biomass.
At present, the majority of large-scale power plants in
Denmark can use biomass for part of their production,
while many natural gas fired small-scale plants have
long had an ambition to convert to biomass-based heat
production.
The largest Danish cities have ambitious climate plans
and have expressed their wish to make heating from
large-scale plants carbon-neutral within the next 20
years. The government will therefore allow for a greater
degree of freedom of contract between producers and
buyers of district heating in the larger cities. Furthermore,
the government will remove the restrictions on the free
choice of fuel for smaller plants outside the ETS sector,
so that these plants can replace natural gas with
biomass.
By removing these restrictions and introducing the free
choice of fuel, the government can also contribute to
lower heating prices in the district heating areas involved.
This will especially benefit the open-field plants, some
of which today charge very high prices. The free choice
of fuel will also make for greater use of local biomass
resources by smaller plants, for instance straw and chippings,
to the extent that this is profitable.
• Change the provisions of the Danish Heat Supply
Act, so that the settlement of prices on heating
produced from biomass at large-scale CHP plants
will no longer be limited by non-profit regulation. In
this way, producers and buyers of CHP can agree
on a price by which they share the tax benefits of the
transition to biomass
• Allow plants of up to 20MW a free choice of fuel,
which will enable a number of natural gas fired plants
to convert to production based on biomass
• Carry out an analysis of the use of biomass for
energy-related purposes in Denmark. The analysis
will focus on whether the right framework conditions
for efficient and environmentally sustainable use of
biomass resources are in place. The analysis will
prepare a long-term strategy for the use of biomass
resources for energy purposes and will draw on
experience from other counties
Energy Strategy 2050 – from coal, oil and gas to green energy.
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