Danish Power Deficit May Triple Over Next Five Years, Lobby Says

Denmark will probably triple its dependence on power imports over the next five years as gas- fired plants become uneconomical, the country’s District Heating Association said.

“Power production from natural gas-fired cogeneration plants cannot compete with coal-fired plants, since coal is so cheap and gas is so expensive,” resulting in as many as 250 combined heat and power plants, mostly fired with natural gas, probably being closed by the end of 2018, John Tang, technical consultant at Dansk Fjernverme, the country’s district heating association, said today on the lobby group’s website.

That means Denmark’s deficit in power production capacity during peak demand will grow from 600 megawatts today to 2,400 megawatts over the next five years, the association said.

In cold periods, the Danish power supply depends on a “very high usage of the import capacity” to maintain supply, Entsoe, a Brussels-based group of national grid operators, said in a Nov. 19 report on its website.

As of 2019, cogeneration plants will no longer receive a state subsidy which has guaranteed their operation in spite of cheaper production from wind farms and coal-fired cogeneration plants, and this may prompt their closure, the Danish district heating association said. It costs 150 kroner ($27.04) a megawatt-hour to produce power from coal at a cogeneration plant, and 300 to 350 kroner to generate electricity from gas, Tang said.

In the first 11 months of last year, power production from public combined heat and power plants dropped 29 percent from a year earlier to 3 terawatt-hours, data published by the Danish Energy Agency showed last week.

To contact the reporter on this story: Torsten Fagerholm in Helsinki at tfagerholm@bloomberg.net

To contact the editor responsible for this story: Lars Paulsson at lpaulsson@bloomberg.net

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