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Close to agreement on new wind market framework
1 April 2004
The Danish government is ready to set national wind power development rolling once again with legislation to stimulate investment in projects for DKK 10 billion (EUR 1.3 billion) over the next six to eight years. This can mean new offshore wind plant and improved regulatory conditions for wind power generated by new stations on land. But details of the current round of intense energy policy negotiations between the government, its coalition partner, and left wing opposition parties are in short supply. The aim is for a broad cross-party agreement on liberalisation of the Danish energy market that will not be overturned by a change of government to ensure a stable and long term market. Former energy and environment minister under the previous left wing government, Svend Auken, a staunch wind power supporter, is leading the talks. As the price for his agreement to the broad energy plan he is demanding legislation to stimulate more onshore and offshore wind development. Neither side will comment on discussions, but it seems the Auken wing is demanding two 200 MW demonstration offshore wind plant beyond the two already built at Horns Reef and Nysted. His original plan was for five. The current government has said it will accept two, one at Omø Stålgrunde in the Great Belt between the big islands of Funen and Zealand, and an extension of the 160 MW Horns Reef station off the coast of Jutland. Moreover, the current cap on the price paid for wind electricity of DKK 36 (EUR 0.05/kWh) will not be applied to new offshore development. The cap applies to new turbines and old turbines no longer in receipt of subsidised payment. Auken's second demand is for stimulation of more repowering of outdated wind plant, this time with a financial reward for replacement of all turbines with capacity ratings of 450 kW and less. The previous three year program, which came to a close January 1, led to 1480 smaller turbines -- with a combined capacity of 122 MW -- being replaced by 272 larger turbines that added 324 MW to the national total, now at 3115 MW. There is apparent agreement that incentives must be available over several years to maintain stability in the domestic market. The turbine manufacturing industry is currently moving jobs out of Denmark. The goal is to reach an agreement by April 8, but in mid March progress was slow and the atmosphere between the two sides acrimonious. Meantime, the global industry is left waiting for the promised government tender for new offshore wind power generation.
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