The European Commission (EC) has approved a state aid scheme of approximately €550 million to support electricity production in existing and depreciated biomass installations in Denmark, the EC announced Tuesday.
The Commission said the scheme is necessary to prevent the switch of supported installations to fossil fuels.
The installations benefitting from the scheme will receive support in the form of a premium covering the additional operating costs of producing electricity from biomass compared to electricity production from a coal plant, the statement said.
According to the EC, the premium will be calculated on an annual basis and capped at approximately €0.015 per kilowatt-hour (kWh). The scheme will run until Dec. 31, 2029.
The scheme is also expected to help Denmark reach its target of 55% of electricity production from renewable energy by 2030 and its objective of phasing out coal from its electricity production by the same year.
The Commission concluded that the scheme will contribute to the EU's energy and environmental objectives and the goals set by the European Green Deal, without unduly distorting competition.
"On this basis, the Commission approved the measure under EU State aid rules," the EC said.
By Ebru Sengul Cevrioglu