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With more than 100 years of experience in district heating, Denmark is a showcase for how district heating can provide cost-effective, energy-efficient and resilient heating. Read more in our white paper as we unpack district energy as a key solution in a futureproof energy system.
Discover the white paperOn Friday the 17th of January, the Danish government reached a long-awaited agreement with multiple political parties to remove a price cap on excess heat, paving the way for businesses to channel surplus energy to heat Danish homes. This move aims to make better use of waste heat from industries, such as data centres, while reducing energy waste.
Also read: The world’s largest untapped energy source: Excess heat
By removing the price cap, the government has eliminated a regulatory barrier that previously limited the use of surplus heat from industries such as data centres and manufacturing. This change allows district heating companies to negotiate directly with businesses to incorporate excess heat into their systems.
“We are now removing a specific barrier and providing greater flexibility to enable the development of excess heat solutions. At the same time, district heating companies will take on greater responsibility to ensure that projects involving businesses are economically viable and beneficial for consumers. The price cap initially made sense to protect consumers, but it has become clear that the framework has been too restrictive. I am pleased that we have reached a solution together with the other parties.” Lars Aagaard, Denmark’s Minister for Climate, Energy, and Utilities
Currently, excess heat accounts for approximately 4 percent of district heating production in Denmark. The government expects this share to grow as new projects emerge under the updated framework.
Excess heat has the potential to be a competitive green energy source, offering lower heating costs for consumers while providing financial benefits for the businesses that supply it.
This surplus heat can come from various types of companies, including those relying on fossil-based production as long as such operations continue. However, the government and agreement parties see even greater potential in large-scale facilities powered by renewable energy, such as hydrogen production, carbon capture, and data centres.
Excess heat from industry has the potential to heat up millions of homes. Currently, the amount of heat wasted in the EU industry corresponds to the heat demand of 10 million single family households. This is one of the reasons why it is imperative to engage in sector coupling from a district heating perspective.
