District heating and cooling as part of Danish energy and climate policy

In December 2019 the Danish Parliament agreed on the first-ever Danish Climate Law with binding targets, obligating current as well as future governments to work actively on reducing CO2 emissions. Importantly, the law sets a goal of 70 pct. CO2 neutrality in 2030, compared to 1990 levels. 

Danish energy and climate policy

Danish energy policy was introduced in the wake of the 1970s oil crisis, where district heating played an important factor. In Denmark, the climate and energy policies have different aims, but both strive for CO2 neutrality. The Danish climate policy is more general, aiming at determining and managing greenhouse gas emissions from the energy sector and other sectors. The Danish energy policy, on the other hand, aims at securing stable and secure energy supply in a way that takes into account that Denmark should cease to be dependent on fossil fuels (coal, oil and gas) by 2050.

The Danish Energy policy is an ambitious strategy, which entails that Denmark must be able to cover the whole of its net energy consumption with renewable energy by 2050. Net consumption means that fossil energy will still be required in certain cases, subject to Denmark being able to export a corresponding quantity of renewable energy to other countries.

There are two main strategies towards a reorganization of the energy system: increasing the supply of renewable energies and securing energy optimization. Therefore, the Danish energy and supply sector is currently undergoing a transition towards energy production based on renewable energy sources, such as solar, wind, biomass and geothermal energy.

To ensure energy efficiency, research is being done on how to improve energy systems (as an example Green Energy Association’s research on large heat pumps). The transition will solve problems with regard to security of supply and challenges posed by the climate.

The role of district heating

The Danish district heating and cooling sector is no exception in the transition towards a more sustainable energy policy. Energy efficiency gains and green transition characterize the development of the sector, which annually bases an increased proportion of the supply on green energy sources. In consequence, over half of the energy used for district heating production today comes from green energy.

Denmark is a front-runner on green energy within renewable energy and energy efficiency. But for Denmark to remain in this position, district energy is essential and district heating is necessary.

With the increasing focus on the UN Sustainable Development Goals (UN SDGs) in all aspects of business Danish district heating is becoming more relevant as a collective approach to sustainability, because district heating in many ways already fulfil or contribute to several of the SDGs. Danish District Heating Association (DDHA) is actively working on the SDGs with a specific focus on several of them. See District Heating and the UN Sustainable Development Goals.

Green heating

Part of the 70 pct. reduction target by 2030 is a sustainable and green transition of the existing building stock in Denmark. With a joint proposal from DDHA, district heating will be able to contribute to 44 pct. of the necessary CO2 reductions by 2030.

The proposal contains three areas:

1. DDHA has an objective of 100 pct. CO2 neutrality of the district heating sector by 2030. If carried out, this will contribute to approx. 33 pct. of the Danish 2030 target.
2. DDHA has launched a new concept aiming to secure a green transition of 500,000 fossil fueled households. This will contribute an additional 7 pct.
3. The Danish district heating sector should contribute to the green transition of the industrial sector and will thus contribute an additional 5 pct., reaching the joint contribution of 44 pct. 

The Governments reform program Denmark can do more  

In August 2021 the government presented the first part of its ambitious reform program, Denmark can do more l. The reform program focuses on expanding the work force as well as investments in education, research and green transition. 

The government has presented a proposal for Denmark can do more II, which sets the direction for a greener and safer Denmark. The proposal is an extension of several green agreements between the government and other parties. The proposal points to five concrete paths that lead to faster phasing out of natural gas and acceleration of the green transition: 

1. More sustainable heat. Natural gas must be phased out. 
2. More renewable gas.  
3. Far more renewable electricity. 
4. A tax reform to ensure green transformation of the industry. 
5. Danish renewable energy solutions to promote sustainable conversion in Europe. 

The proposal includes an initiative regarding accelerated roll-out of district heating to more households, which must be completed by 2028. This means that the municipalities must have made heating plans so that all homeowners heating with individual gas or oil receive a letter about whether they can get district heating or not. There are currently around 400,000 Danish homes that are heated with natural gas. For 30-50 percent of them, the government estimates that district heating will be the best alternative.  

DDHA supports the governments proposal and is pleased to see an ambitious supply plan, which reflects the increasing public interest in getting rid of natural gas and switching to sustainable district heating. 

DDHA’s political initiative A Faster Way Towards a Sustainable Denmark 

If Denmark is to achieve the goal of green transition and phase out natural gas with sustainable district heating by 2028, as the Government's proposal Denmark can do more II propose, it is important to pitch some initiatives to meet these ambitions. 

DDHA on behalf of its members presents an ambitious climate and supply proposal that shows a sector that is ready to take its share of the responsibility for the change that Denmark needs. DDHA’s political initiative A Faster Way Towards a Sustainable Denmark lists six concrete initiatives that will help to ensure the objectives. 

DDHA suggest the following: 

1. Existing political climate agreements must be revisited, and the goals must be more incisive.
2. We must continue to have high security of supply.
3.  The phasing out natural gas must be accelerated. 
4. CO₂ tax must ensure conversion to renewable energy and negative emissions.  
5. Ambitions for CO₂ capture must be significantly raised.
6. We must exploit the potentials of waste heat.