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Denmark to hike gas production, quadruple green power to displace Russian gas

Highlights

Production at Tyra II to start as soon as possible

Plans to add up to 4 GW offshore wind by 2030

Natural gas in heating to be phased out

  • Author
  • Andreas Franke    Stuart Elliott
  • Editor
  • Agamoni Ghosh
  • Commodity
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  • Energy Transition Europe Energy Price Crisis Environment and Sustainability War in Ukraine

Denmark plans to quadruple green power production by 2030, boost green gas and temporarily hike domestic natural gas production to displace Russian gas, the energy ministry said April 19.

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The plans include removing administrative barriers so that the Tyra field in the North Sea can resume gas production as soon as possible as well as up to 4 GW additional offshore wind capacity by 2030, the ministry said.

"We will supply Europe with green energy and displace Russian gas," Minister for Climate, Energy and Utilities Dan Jorgensen said.

The strategy consists of five tracks accelerating the green transition, boosting green heat, phasing out natural gas, boosting green electricity and a green tax reform.

Boosting gas production

In the near term, to displace Russian gas, Copenhagen plans to advance and temporarily increase the extraction of natural gas in the North Sea on already licensed fields, it said.

The Tyra field is the largest in the Danish sector of the North Sea, but was closed for redevelopment work in 2019.

The government pledged to "clear any administrative barriers so that the Tyra field can produce natural gas as soon as possible."

France's TotalEnergies, which operates Tyra, has said that it expects to restart the field in mid-2023 with production of some 60,000 b/d of oil equivalent, of which two thirds would be gas.

TotalEnergies said April 12 that it had lifted the Tyra II utility and living quarters into its final position.

It added that the key processing platform would be delivered from Indonesia in the second half of 2022.

Denmark also wants to explore the possibility of increasing Danish gas supply via the Baltic Pipe gas pipeline from Norway to Poland, it said.

This also includes higher biogas production, which already reached a 25% share in gas consumption in late 2021, including a planned tender, it said.

Green power drive

The government plans to make available an additional 1-4 GW offshore wind for deployment by end-2030 with specific proposals before the summer break, it said.

The country, which already has 7 GW wind generating half the country's electricity, plans to develop more energy islands and remove barriers and better balance environmental regulation onshore.

Plans for the first two energy islands hosting 5 GW offshore are underway with an artificial island to be constructed in the North Sea and a second hub planned offshore Bornholm.

The projects combine wind generation with green hydrogen production as well as power interconnectors.

The expansion of renewables will make Denmark a net exporter of green energy by 2030, it said.

Wind and solar generated some 17 TWh of electricity in 2021.

Phasing out natural gas

Denmark plans to reduce the consumption of natural gas in order to become independent from Russia as soon as possible, the government said, setting a 100% target for green gas in heating by 2030.

Approximately 400,000 homeowners with fossil heating have to find another heat source by 2028 with the roll-out of green district heating to be accelerated.

For homes that cannot get district heating, the goal is to replace the boiler with a green heat pump or replace gas with green gas, it said.

The government also plans to present a proposal for a green tax reform, which will be a big driver for the decarbonization of industry.

Denmark already has a plan to reduce CO2 emissions in 2030 by 70% over 1990 with green electricity at its core.

The country already halved its natural gas demand to around 2.3 bcm in 2021, while electricity production is projected to rise with surplus energy exported or used for green hydrogen production.

Wholesale power prices in Denmark are traditionally at a discount to Continental Europe, but vary depending on the supply of wind and imports from the Nordics.