The Danish government will provide a DKK1.25bn ($200mn) state subsidy scheme for hydrogen production as part of a new plan to build 4-6GW of electrolysis capacity by 2030.

A cross-party agreement was reached on the funding following Russia’s invasion of Ukraine.

“Europe is intensely searching for alternatives to fossil fuels, and we are in a hurry not only to become green, but also to become more independent from Russian fossil energy,” says Dan Jorgensen, minister for climate, energy and utilities.  

The government will also present a plan for expanding onshore and offshore renewable energy generation in Denmark to power the electrolysers.

4-6GW – Targeted electrolyser capacity

The hydrogen scheme will operate as a fixed price subsidy for a ten-year period. The agreement also puts in place further mechanisms that will funnel more than DKK3bn towards the development and maturation of green hydrogen production, including DKK57mn for a hydrogen taskforce that will provide guidance to project developers and authorities and a DKK344mn innovation fund.

The government will also initiate a full review of Denmark’s legislation in relation to hydrogen and develop a national market regulation for the fuel.

National transmission system operator Energinet and gas distributor Evida will be granted licences to own and operate hydrogen infrastructure.

Building on ‘Fit for 55’

The Danish Energy Agency’s analyses show that the proposals in the EU ‘Fit-for-55’ package will create a major demand for hydrogen in Denmark and the EU in general.

The proposals are still passing through the legislative process, and the government says it will push for ambitious requirements in that package.

“These requirements will result in a higher national and international demand for power-to-X products [such as hydrogen] through fundamentally uniform framework conditions across the EU that will contribute to promoting the use of power-to-X where it has viable long-term applications,” says the agency’s latest strategy document. 

The government is to work on creating demand and will release separate strategies within the next two years with a focus on industry, road transport, shipping and aviation.

Playing to strengths

Denmark has good wind resources and a well-established wind energy industry.

The Brande Hydrogen test site in western Denmark produced the first green hydrogen from an electrolyser powered by a dedicated wind turbine last year.

Danish wind firm Orsted is involved in several projects aiming to deliver sustainable fuels for maritime transport, including the Green Fuels for Denmark project in Copenhagen.

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Author: Tom Young