Danish Government could stop further development of nearshore projects as it is contemplating lowering the country’s energy transition ambitions, saying Public Service Obligations (PSO) levy is too high and therefore wants to reopen the energy agreement.
A proposal for changing the PSO system was presented by Danish Energy Minister Lars Christian Lilleholt and Business and Growth Troels Lund Poulsen on Friday, ahead of budget negotiations, Politiken reported.
Five nearshore wind farms planned to be built off Danish coasts would be completely dropped as part of this plan. Canceling the nearshore wind projects would save the country some DKK 7 billion, according to Minister Lilleholt.
The country would have to pour DKK 70 billion into the energy transition over the next 10 years, which is far more than previously expected, he said.
The main reason for this is not only the development of renewable energy, but also low electricity prices. The lower the price of electricity is, the more does it take in support for renewable energy, the Minister explained.
The nearshore tender initially comprised six sites, but Danish authorities recently removed the Sejerø Bugt site from the bidding process.
The deadline for submitting final bids for the five nearshore wind sites is 1 September.