13 BEYOND WIND: NEW CHALLENGES TO THE EXPANSION …
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Here we focus our attention on Denmark as a case study of energy
transformation. To this end, we first present a concise and recent history
of Denmark’s energy economy and policy. Our history reveals that over
the years, Denmark has successfully combined centralized planning of the
energy sector together with market integration in an ad hoc manner.
Then we identify and investigate four of the most critical challenges
for the present and future of the ongoing Danish transition. These are:
greening the Danish transportation sector, reforming the Danish district
heating sector while increasing the share of renewables in heat production, removing the cost barriers in the usage of electric transportation
and heating, and finally, meeting the increasing flexibility requirements
in conjunction with dwindling domestic backup capacity. In the third
section, we identify both transferrable and non-transferable lessons for
other countries. Finally, we conclude with a series of policy recommendations useful for Denmark and other countries aiming at transforming
their energy systems.
A Concise and Recent History
of Denmark’s Energy Economy and Policy
In 1972, Denmark’s gross fuel consumption was highly concentrated:
92% was oil. It was the most important fuel source for space heating
(78%), electricity generation (75%), and transportation (100%). This
meant that the first oil crisis (October 1973), which began when the
Organization of Petroleum Exporting Countries (OPEC) declared an oil
embargo, hit Denmark particularly hard (Sovacool 2013). Average international crude oil prices (non-deflated) more than tripled in a very short
period, going from 3.29 USD/barrel in 1973 to 11.58 USD/barrel in
1974 (BP 2018). As an immediate reaction, Denmark decreed car-free
Sundays, imposed stricter speed limit restrictions on motorists, ordered
crude oil savings for industries and transport, and promoted energy
conservation during the crisis’ winter months.
The crisis gave momentum to the energy policy debate in Denmark.
For the first time, there was an initiative to define an energy plan
with clear goals over a two-decade timeframe. Shifting from oil to coal
and developing nuclear power were leading components of the Danish
government’s first energy plan (1976). In 1974, the government had
announced nine possible nuclear sites in the country, proposing to deploy
6.2 GW between 1985 and 1999. Another initiative of the first plan was
321
Here we focus our attention on Denmark as a case study of energy
transformation. To this end, we first present a concise and recent history
of Denmark’s energy economy and policy. Our history reveals that over
the years, Denmark has successfully combined centralized planning of the
energy sector together with market integration in an ad hoc manner.
Then we identify and investigate four of the most critical challenges
for the present and future of the ongoing Danish transition. These are:
greening the Danish transportation sector, reforming the Danish district
heating sector while increasing the share of renewables in heat production, removing the cost barriers in the usage of electric transportation
and heating, and finally, meeting the increasing flexibility requirements
in conjunction with dwindling domestic backup capacity. In the third
section, we identify both transferrable and non-transferable lessons for
other countries. Finally, we conclude with a series of policy recommendations useful for Denmark and other countries aiming at transforming
their energy systems.
A Concise and Recent History
of Denmark’s Energy Economy and Policy
In 1972, Denmark’s gross fuel consumption was highly concentrated:
92% was oil. It was the most important fuel source for space heating
(78%), electricity generation (75%), and transportation (100%). This
meant that the first oil crisis (October 1973), which began when the
Organization of Petroleum Exporting Countries (OPEC) declared an oil
embargo, hit Denmark particularly hard (Sovacool 2013). Average international crude oil prices (non-deflated) more than tripled in a very short
period, going from 3.29 USD/barrel in 1973 to 11.58 USD/barrel in
1974 (BP 2018). As an immediate reaction, Denmark decreed car-free
Sundays, imposed stricter speed limit restrictions on motorists, ordered
crude oil savings for industries and transport, and promoted energy
conservation during the crisis’ winter months.
The crisis gave momentum to the energy policy debate in Denmark.
For the first time, there was an initiative to define an energy plan
with clear goals over a two-decade timeframe. Shifting from oil to coal
and developing nuclear power were leading components of the Danish
government’s first energy plan (1976). In 1974, the government had
announced nine possible nuclear sites in the country, proposing to deploy
6.2 GW between 1985 and 1999. Another initiative of the first plan was