Public supply of heat is widespread throughout Denmark. Approximately 60% of all households are heated with district heat from district-heating plants and co-generation plants, from which heat is piped directly to consumers.
Authorities
The local authorities are the central players in the public heat-supply. They develop heating plans and have responsibility for expanding district heating and for implementing any changes made necessary by amendments to the regulations in the Law on Heat Supply.
The Danish Energy Authority has set the general conditions for the establishment and operation of district heating. These conditions are intended to ensure that both cost-effectiveness and consumers' heating costs are taken into consideration.
The Danish Energy Regulatory Authority and the Energy Supplies Complaint Board monitor the district-heating sector and handle complaints regarding prices and conditions.
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THE DANISH ENERGY REGULATORY AUTHORITY
The Danish Energy Regulatory Authority (DERA) monitors the district-heating sector and handles complaints of a general nature. All district-heating and co-generation plants are obliged to keep the DERA informed about consumer prices and conditions so that it is able to handle any complaints or objections. The DERA usually deals with general questions such as those regarding tariffs and delivery conditions.
THE ENERGY SUPPLIES COMPLAINT BOARD
The Energy Sector Board of Appeal, on the other hand, deals with private consumers' complaints regarding energy companies' purchase and delivery of heat. It was set up on 1 November 2004. |
District heating: from plants to consumers
To a large extent, district-heating supply is a natural monopoly. It would not be cost-effective to have a parallel supply network distributing heat to individual consumers. The costs involved are so prohibitive that there is often only one provider in a given area.
The production of district heating for a supply network is also monopoly-like in nature. This is a question, as is the case with the distribution of district heating in costly pipe-systems, of economies of scale.
The establishment and operation of a network and the sale of district heating is usually organised within a single company.
In smaller areas, this is often a consumer-owned company; in the larger cities, it is usually the local authority which owns the local network.
The district-heating sector is owned and operated in various ways. There are co-operatives, joint-stock companies and local-authority companies (often interest-group companies and local-authority supply bodies).
District-heating plants are organised in two associations: Danish District Heating and the Association for Decentralised Co-Generated Heating and Electricity.
Consumerprices for districts heating
DH is often cheaper than individual heating. In 2008, only 1% of DH customers pay more than it would cost to produce the heat they consume with oil boilers. Compared to the cost of heat from an individual natural gas boiler, 4% of DH customers pay more for their heat.
The more efficient plants, the more lower prices. The efficiency of plants' co-generated heat and electricity has risen sharply, from 50% in 1980 to approximately 70% in 2000, because increased co-generation of heat and electricity saves large amounts of fuel. In addition, continued technological improvements mean that more electricity and heat can be generated from a given amount of fuel.
Danish companies producing and exporting district heating technology
The Danish Board of District Heating represents the leading actors within the energy sector. Their homapage contains a host of information on DH in Denmark, the latest development of the sector, selected articles etc.