Denmark’s government abandoned plans to build five offshore wind power farms Friday amid fears the electricity produced there would become too expensive for Danish consumers.
“Since 2012 when we reached the political agreement, the cost of our renewable policy has increased dramatically,” said Climate Minister Lars Christian Lilleholt, a Liberal Party politician representing the country’s minority government, according to Reuters.
The government would have had to pay $10.63 billion to buy electricity from the five wind farms — a price deemed too expensive for consumers who already face the highest electricity prices in Europe.
“We can’t accept this, as the private sector and households are paying far too much. Denmark’s renewable policy has turned out to be too expensive,” Lilleholt said.
Denmark gets about 40 percent of its electricity from wind power and has a goal of getting half of its electricity from wind by 2020. But that goal has come up against a stronger prevailing headwind: high energy prices.
Danes have paid billions in taxes and fees to support wind turbines, which has caused electricity prices to skyrocket even as the price of actual electricity has decreased. Now, green taxes make up 66 percent of Danish electricity bills. Only 15 percent of electricity bills went to energy generation.
Electricity prices have gotten so high, the government has decided to slash green taxes on consumer energy bills.
“The PSO tariff is expensive and ineffective. We have long believed that the rising costs are unsustainable and now it is abundantly clear that we have to find an alternative. Therefore the government is ready for a showdown over the PSO levy,” Tax Minister Karsten Lauritzen said Tuesday.
Danish politicians still want the country to be completely independent of fossil fuels by 2050 as part of their effort to combat global warming, but ratcheting down green energy taxes means they’ll have to find other ways to finance wind projects.
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