Denmark to Renationalize Transmission Grid

Denmark is to renationalize its power transmission grid to allow fairer access conditions to wind and distributed generation.

Broad agreement was reached at the end of March between parties of the ruling coalition in Denmark on a transfer of ownership of the electricity grid from the present grid system operators, ELTRA and Elkraft, to a new state-owned enterprise, EnergiNet Danmark, as of January 2005. The present operators will not receive any remuneration from the state.

Minister for Economic and Business Affairs in Denmark, Bendt Bendtsen, commented: ‘This is a far-sighted agreement to provide the necessary conditions for an energy market which should function more smoothly in future. The whole electricity grid in Denmark will belong to the government, ensuring that it is open to all users of the network on equal footing. On my part it is also important to point out that this agreement provides a stable framework for investors in the Danish electricity market.’

Preben Maegaard of the Folkecenter for Renewable Energy and President of the World Wind Energy Association described as ‘sensational’ the decision to nationalize the high-voltage power transmission system in order to allow all users equal access to the grid.

Measures will also stimulate upwards of 750 MW new wind power capacity in Denmark over the coming five years, through two new large offshore wind farms and a five-year scheme to replace outmoded, small-capacity wind turbines with newer, larger turbines. Minister Bendt Bendtsen said that the whole production of energy from wind turbines and district CHP plants would now be sold under market conditions.

However, it has also been agreed that power distribution systems below 132 kV and power production plants now owned by municipalities and/or consumer co-operatives can be taken over by private enterprises and perhaps sold to foreign investors. How this change of ownership will influence independent power producers, especially wind power and CHP that account for over 50% of electricity in Denmark, is still under discussion, says Maegaard.


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to UK distributed generation

UK energy regulator Ofgem and the Government’s Department of Trade and Industry have published the second annual report of the Distributed Generation Co-ordination Group (DGCG), which shows that at least half of the 24 barriers to the development of small-scale distributed generation (DG) identified by the DGCG when it was founded have been removed. Many, but not all, of these distributed generators are wind farms or other renewable generation schemes.

UK Energy Minister Stephen Timms said: ‘The DGCG has made real progress in addressing many of the barriers faced by distributed generation and is to be congratulated on its work to date. However, much more remains to be done, particularly in addressing the significant barriers to the connection of smaller-scale generation that remain in place.’

The focus of the DGCG has been the removal of barriers to the development and connection of DG. The report says that barriers removed include a lack of:

  • a standard approach by distribution companies where more than one generator is seeking connection to the same section of the distribution network
  • standard technical guidance on the connection of distributed generation
  • a modern methodology for assessing the contribution of modern types of distributed generation to network security

Meanwhile, Ofgem has re-affirmed its commitment to supporting electricity distribution companies in removing barriers for DG connecting to distribution networks.

Ofgem Chairman, Sir John Mogg, said: ‘Companies running regional electricity networks are facing a period of significant change and great opportunity, particularly with the Government’s drive to develop renewable generation. We have been developing a regulatory framework that will give real incentives to the distribution companies to invest efficiently and quickly to secure maximum value and benefit for customers from the growth of distributed generation.’

The regulatory framework will provide incentives for distribution companies to take a proactive and positive approach to generators wanting to connect. Companies will have real opportunities for high returns if they connect DG in a timely and cost-effective manner. The framework will also provide strong protection against any downside risk they may face, says Ofgem.


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