The Biomass Agreement

In 1993, the government set an objective to increase biomass use from 50 PJ to 75 PJ by 2000 (10% of total fuel consumption) and to establish two to three large biomass plants before 2003. The two main electricity suppliers (Elsam and Elkraft) were to incorporate the use of 1.2 million tonnes of straw and 0.2 million tonnes of wood in large-scale power plants. These objectives were not met. Modifications to the Biomass Agreement in 1997 and 2000 provided more flexibility in the choice of biomass procured. The targets were maintained but the time for fulfilment was prolonged until 2005. With the modification in 2000, the costs to the utilities for fulfilment of the Biomass Agreement were transferred to electricity consumers as an extra charge. A feed-in tariff provides a ten-year guarantee of DKK 0.30/kWh settlement price and an additional DKK 0.10/kWh until the green certificates market is established and green certificates replace this portion.

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