Danish Parliament adopts new rules to support geothermal
The Danish Parliament has set new rules for the price regulation of geothermal energy, paving the way for large-scale geothermal heating projects.
The Parliament of Denmark has adopted a new law that effectively exempts geothermal heat projects from the current price regulation. Instead, pricing will be determined through a contract between the district heating company and the geothermal operator, thus placing a ceiling on the costs consumer will pay for the geothermal heat.
The new law is expected to further encourage the development of geothermal heating projects in Denmark. It balances the needs for protecting the consumers and the district heating companies from risks related to geothermal resource development and the need for long-term and stable framework conditions.
The Danish Supply Authority, as an independent authority, will have the discretion to approve the exception and ensure the conditions are met. This will guarantee that consumers do not bear the risks and associated costs in connection with geothermal drilling.
The new rules for geothermal heat are paving the way for Denmark’s first large-scale heating plant in Aarhus. The project is being developed by Danish developer Innargi A/S and district heating company Kredsløb. Earlier this year, Innargi announced that drilling locations have been identified for the first two heating plants in Aarhus.
“Our ambitious climate goals make it necessary to use all green energy technologies. With the new rules, we are paving the way for green heat from the underground to 35,000 Aarhusian homes by providing good conditions for investment, while at the same time keeping a hand under the consumers”, said Lars Aagaard, Minister for Climate, Energy, and Utilities.
“Similar projects are already being worked on in other cities, and I hope that in the long term these can follow Aarhus’ example, so that we make full use of the hot water under our feet, and more Danes are supplied with green heat from the underground,” added Aagaard.