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On 8 February 2023, the Minister for Climate, Energy and Utilities presented Bill no. L 37 to amend the Electricity Supply Act (lov om elforsyning) and the Act on Taxation of Electricity (lov om afgift af elektricitet), following up on the March 2022 voting agreement.

Among other things, the Bill authorises the Minister for Climate, Energy and Utilities to lay down rules making it impossible to issue new permits (or allow essential changes regarding the permits) for electricity production based on coal and promotes a new use of electricity for PtX facilities, heat pumps and new green electricity production based on wind and sun energy. The Bill will follow up on the voting agreement by the Danish Government and several other parties from the Danish Parliament of 15 March 2022 regarding "Development and promotion of hydrogen and green fuels (Power-to-X-strategy)", on the COP26 agreement "No new coal compact" and on the agreement of 18 December 2020 regarding the implementation of Article 21 RED-II on a special arrangement for local solar cells and solar cell analysis.

The Bill includes the following elements:

  • The Bill offers the opportunity to establish commercially owned direct lines for electricity clients and manufacturers connected to the grid at a 10 KV voltage level and above. The purpose of the direct lines is to secure improved framework conditions for green technologies such as PtX facilities and to contribute to a more effective exploitation of the collective grid including an opportunity to economise on grid investments. 
  • The Bill intends to adjust the ban on geographically differentiated user tariffs, making it possible for collective electricity supply companies like Energinet and grid companies to differentiate user tariffs geographically for electricity users connected to the grid at a 10 KV voltage level and above.
  • The Bill provides a definition of users who produce their own renewable energy, aka renewables self-consumers (VE-egenforbruger), for the Electricity Supply Act. Renewables self-consumers are defined as electricity clients who within their place of consumption produce renewable electricity for their own consumption.
  • The Bill implies codification of the existing practice for "internal grids" in the Electricity Supply Act, referring to internal grids as "internal electricity connection", which will be defined as an electricity connection which is not owned by a collective electricity supply company and which is used as 1) a connection of an electricity client's production facility, set up in connection with the electricity client's place of consumption, for their own consumption facility and distribution of electricity for the consumer's own use and storage behind the production facility, 2) the distribution of electricity supplied by the collective electricity supply network to the client's consumption facility and for the client's own use behind the production facility and 3) distribution of the electricity in one and the same building occupied by one or several electricity clients.
  • An amendment to the Act on Taxation of Electricity will consist of new rules for metering, accounting, invoice claims, control requirements and penalties in connection with the electricity distributed through a direct line.

Under the Energy Supply Act, the Minister for Climate, Energy and Utilities will be given authority to

  • lay down rules that make it impossible to establish new production facilities using coal in Denmark
  • provide further rules governing renewables self-consumers
  • lay down rules regarding internal electricity connections
  • lay down rules for new, state-owned solar cell installations regarding set-off of the savings made by the state-owned agencies compared with the electricity tax on the use of electricity produced by renewables self-consumers who produce their own electricity from the solar cell installations
  • lay down rules regarding the registering of data for facilities producing electricity, facilities for energy storage and facilities for electricity consumption in the Master Data Register (Stamdataregistret).

The first parliamentary reading of the Bill is scheduled for today, 23 February 2023. 

Bech-Bruun is among the leading advisers in the area of renewable energy. Our specialists are internationally recognised for their significant industry knowledge and advise on all legal aspects of the energy area. With our longstanding experience from major utility projects, complex transactions in the solar and wind industries and extensive contracts, we have built unique market insight to the benefit of our clients' businesses. And with our position at the cutting-edge of the green transition, including multiple carbon projects, we provide advice to our clients on the green solutions of the future.