Foto: Thomas Rousing/Scanpix Denmark

Topic: Energy crisis

Denmark is currently facing the possibility of a serious energy crisis due to the war in Ukraine. There is an elevated risk of power shortages and Danes are being encouraged to conserve energy.

The war in Ukraine and the reduction of gas supplies from Russia has caused greater uncertainty for the energy supply situation in Europe. This situation has resulted in a greater risk of power shortages and it has had consequences for the heating of buildings, street lighting and energy consumption in Denmark.

Although the situation is currently stable for all energy sources, Danish consumers are nonetheless encouraged to continue conserving energy. This helps both to support the supply of energy in Denmark and it can also help to protect consumers from high energy bills.

This page contains information about the current situation and what it means for consumers and society at large.

CURRENT STATUS:

Energy supply is stable for all energy sources. Prices vary and can be high during certain periods. The situation could change quickly at any moment.

The Danish Energy Agency monitors energy supply and publishes a monthly status report which you can find here:

Status of energy supply - Information in Danish (ens.dk)

Will there be power shortages in the first half of 2023?

If consumers continue to conserve energy as they have been doing so far, and provided the weather remains moderate over the remainder of the cold period, the Danish Energy Agency does not expect power shortages first half of 2023.

However, the risk of power shortages is still higher than normal, and you can read more about what this means here:

Risk of power shortages in Denmark

How will energy prices develop?

Energy prices are high across Europe – in part, because energy markets are reacting to the current situation.

However, it is likely that the supply situation will continue to impact energy prices in Europe – both for electricity and gas. Oil prices are also high.

 

Read more about high energy prices on SparEnergi.dk (in Danish)

What can I do?

The Danish Energy Agency encourages all citizens to conserve energy. It is vital for the supply of energy next winter that we all continue to conserve energy – even when the warmer weather returns and we start using the heating less. Some ways you can conserve energy include:

  • Turning down the heat, but not below a minimum of 18 degrees
  • Limiting your use of hot water
  • Saving electricity – turn off appliances when you are not using them and switch off lights when they aren’t needed
  • Use electricity when it’s cheapest – spread your energy usage throughout the day

By conserving energy and using power when the prices are lower, we can benefit both the climate and our finances. You can find many more tips on how to save energy at SparEnergi.dk. This website also contains more information on how you can apply for help with your electricity and heating bills, and for the energy renovation of your home. Read more here (in Danish):

The best savings tips for winter (sparenergi.dk)

Heat your home safely

We all need to conserve energy, but when the temperatures drop, it is also important that we heat our homes.

If you use newer heating sources, you can follow these tips from the Danish Emergency Management Agency and be sure to heat your home safely.

Read the advice and find tips for different heat sources here (in Danish):

Heat your home safely (brs.dk)

Save energy at work

We spend about one-third of our days at work. By changing your habits, you can help make your workplace a part of the solution to the difficult energy situation that we are currently facing.

Remember to switch off lights, screens, computers and other electronic devices before leaving a room or going home.

Find more tips and advice for your workplace from SparEnergi.dk here:

How to save energy at work (information in Danish):

Save oil

You can save petrol and diesel by changing your driving habits ever so slightly. Reducing your speed slightly, checking your tyre pressure and driving without air conditioning are all ways to save fuel.

What are the state, municipalities and regions doing to conserve energy?

The Danish Government, Local Government Denmark and the Danish Regions all agree there is a need to save energy across all public buildings in the country. They therefore launched a project to reduce energy consumption on 8 September 2022.

The measures implemented include:

  • The measures implemented include:
  • Lowering the temperature to 19 degrees in offices and similar
  • Switching off lights in public buildings
  • Reducing the heating season by 14 days at each end
  • Employee information following the Energy Agency's campaign materials containing good tips for the workplace – this is a list of tips and measures that employees can do themselves, such as switching off lights and screens when leaving a meeting room, for example.

In Danish: The Danish Government, Danish Regions and Local Government Denmark agree to conserve energy in the public sector (kefm.dk)

What is the state doing to alleviate the effect of dramatic price rises on Danish consumers?

The government and many of the parties in Parliament have been continuously adopting a range of initiatives to help households and businesses through the crisis. The last agreement on winter aid was made on 23 September 2022.

Below is an overview of some of the most central initiatives taken:

From 1 October 2022, the general electricity tax has been reduced by 4 øre per kWh.

In the first half of 2023, the general electricity tax of 69.7 øre per KWh was temporarily reduced to the EU minimum rate of 0.8 øre per kWh.

Investigations are also being made into the possibility of reducing the electricity tax on heat pumps and of passing some of the windfall revenues made from higher energy prices back to consumers.

Temporary increase of the child and youth benefit by DKK 660 per child. The amount was paid out in January 2023.

In order to shield consumers from even higher prices, a temporary and voluntary deferral scheme was introduced for the share of household and business costs for electricity, gas and district heating that exceed the prices in Q4 2021.

Read more from the Danish Energy Agency (in Danish): The deferral scheme now enters into force (ens.dk)

In the case of district heating, this applies to the share that exceeds the district heating price in January 2022 for the ten most expensive district heating providers.

The deferral scheme means that this share of the electricity, gas and heating bills can be deferred and paid later.

Financial support for a range of disadvantaged citizens affected by rising energy prices. This includes pensioners who receive supplementary pension contributions.

The maximum employment allowance for income years 2022 and 2023 has been raised so the allowance can amount to a maximum of DKK 43,500 for income year 2022 and DKK 44,300 for income year 2023.

Read more on Retsinformation here (in Danish): Act amending the act on the taxation of electricity and the tax assessment act (Reduction of the general electricity tax in the fourth quarter of 2022 and in 2023 and the increase of the maximum employment allowance for income years 2022 and 2023) (retsinformation.dk)

One-off payments of DKK 6,000 were paid out in August, targeted at financially disadvantaged households affected by high price rises.

Better supply of wood pellets: A number of measures have been implemented to support the security of supply for wood pellets, including a crisis response cooperation that will be closely monitoring the supply situation

Scrapping scheme extended to include pellet boilers: The scrapping scheme, which provides grants for the scrapping of oil and gas boilers, has been amended as of 1 December 2022 so that households with pellet boilers can also benefit from the funds. The scheme was increased by DKK 10 million in 2022 and provides support for switching to subscription heat pumps.

Increase of the fund pool for the roll-out of district heating: To accelerate and bolster the roll-out of district heating, the roll-out pool was increased by DKK 150 million in 2022 and by DKK 100 million in 2023.

Increase of subsidies for disconnecting from the gas network: The agreement allocates a further DKK 35 million of subsidies for disconnecting from the gas network in 2023.

Denmark's energy supply

GAS

Gas supplies are stable and European gas storage reserves have been well supplied. Due to the warm autumn, we have only recently begun to use these reserves. But the relatively warm winter conditions so far have meant that the need has been limited. Moreover, the Danes have been good at conserving energy.

The Danish Energy Agency does not consider that it will be necessary to interrupt consumer gas supplies first half of 2023. However, this does not mean that Danes should abandon their efforts to conserve energy.

There remains a risk of gas shortages in the winter of 2023/24, because the lower import levels may result in our storage reserves not being sufficiently filled over the course of summer 2023. It is therefore crucial that we make efforts even now to conserve as much gas as possible.

The Danish Energy Agency issued an early warning on 20 June 2022, which is a call to actors on the gas market to prepare for the risk of a genuine supply crisis.

Our security of supply is better than in many other countries. In 2022, 34 percent of domestic gas consumption was covered by our biogas production and some gas continues to come in from the Syd Arne oil field. At the same time, we have also been transforming our industry, heat and electricity production over several years.

FAQ about the current energy situation - information in Danish (ens.dk)

Unprotected gas customers are large companies with an annual gas consumption of at least 2.3 million Nm3 per year. In the event of a gas supply crisis involving a shortage of gas, these companies may be notified that they are required to reduce their gas consumption.

In the event of an acute gas shortage, the authorities can implement various emergency measures in order to comply with EU requirements to ensure the supply of households and other protected customers for a minimum of 30 days in a period of unusually cold weather.

FAQ about the current energy situation - information in Danish (ens.dk)

ELECTRICITY

Denmark’s electricity supply remains stable. However, the war in Ukraine has posed a challenge to the electricity market in Europe.

Electricity supply could potentially face huge pressures, especially if we enter into a very cold period without wind. This would increase the risk of power outages during this winter and in the coming winter. However, the Danish Energy Agency currently does not expect that it will be necessary to interrupt power supplies first half of 2023.

It is particularly between the hours of 6:00 and 10:00 and between 16:00 and 20:00 in the dark winter months that the risk of power shortages is higher than usual. It is during these periods that the most electricity is used. That is why it is important to both conserve energy and to spread energy usage over a broader period.

Read more about power shortages here

FAQ about the current energy situation - information in Danish (ens.dk)

OIL

The situation in Denmark is robust because we produce some of the oil we use ourselves and have access to imports from the global market. However, we are continuing to monitor the situation closely and we have plans in place should problems occur.

We do not expect any immediate issues in securing oil, petrol and diesel as these can be purchased on the global market. However, this could mean higher prices.

Read more about the oil situation from the Danish Energy Agency (information i Danish)

FAQ about the current energy situation - information in Danish (ens.dk)

WOOD

Supply is stable and the Danish Energy Agency does not expect shortages of biomass, including wood pellets.

Danish energy producers purchase wood biomass from a wide range of countries across the world and biomass is relatively simple to transport and store. The prices may be impacted, however. There is greater uncertainty around the indirect effects, particularly the import of wood biomass from the Baltic states, which cover almost a third of Denmark’s total consumption of wood pellets and wood chips for electricity and district heating.

Wood biomass is comprised largely of waste from the timber industry which previously received a lot of wood from Russia.

FAQ about the current energy situation - information in Danish (ens.dk)

COAL

The coal used in Denmark is imported primarily from Russia, however there are a number of other possible suppliers. According to the energy statistics, coal accounted for less than 10% of gross energy consumption in 2020 and all major consumers are currently phasing coal out. In 2020, coal accounted for 10.7% of electricity production and 5.7% of district heating production.

FAQ about the current energy situation - information in Danish (ens.dk)

Russian coal represents a considerable share of the global market and so it is expected that any boycott of Russian coal would affect the market price.

FAQ about the current energy situation - information in Danish (ens.dk)