The European Commission on March 28 determined that its support of the 600-MW Kriegers Flak offshore wind farm in Danish territorial waters is in line with EU state aid rules. The commission said the project will help Denmark reduce CO2 emissions, in line with EU energy and climate goals, without unduly distorting competition.
"The Kriegers Flak offshore wind farm will help to cut carbon dioxide emissions while the support is carefully designed to avoid distorting competition in electricity markets. I'm glad to be able to approve state support for this project," Margrethe Vestager, commissioner in charge of competition policy, said in a statement.
According to the commission, Denmark in February submitted a notice to the commission for a state support measure consisting of a competitive bidding process for the design, construction and operation of Kriegers Flak.
The support will be granted as a premium on top of the electricity price in the Nord-Pool market, the commission said. The tender was carried out in 2016 and the winning bid was DKK 0.372/kWh (around US$53/MWh) to be paid for a total of 30 TWh of production. No aid will be granted when prices are negative.
In addition, a new interconnector will be established to link the Danish island of Zealand to Germany via the Kriegers Flak offshore wind farm and two German offshore wind farms — Baltic 1 and Baltic 2. The commission said that the interconnector will allow for an increased exchange of electricity between Denmark and Germany.