The European Commission has green lighted, under EU state aid rules, a €400m scheme to support power generation from renewables in Denmark. The scheme will support electricity produced from renewables, namely onshore wind turbines, offshore wind turbines, wave power plants, hydropower plants and solar PV, through a tender organised in 2021-2024 and will take the form of a two-way Contract-for-Difference (CfD) premium. Under the so-called two-way CfD premium model, the renewable power producer will receive a premium on top of the reference price (established based on an auction) when the actual electricity price is lower than the reference price but will correspondingly pay the Danish State when the reference price is higher than the offered bid price.
The measure follows a previous Danish aid scheme for electricity from renewable energy approved by the European Commission in August 2018, which expired on 31 December 2019.