The Danish Energy Model

Building on 40 year's experience

The rethinking of the Danish energy system took its start in the wake of the 1970’s oil crisis. Until then, the Danish energy production had relied almost entirely on imported oil.

During the following 40 years, Denmark began constructing a domestically sourced energy supply, upscaling the use of renewables and making the entire system more energy efficient. Through clearly defined ambitious targets, Denmark has changed the structure of the energy system to be holistic and integrated, yet fully reliable.

One coherent system 

An important aspect of the Danish Energy Model is focusing on interactions among sectors and systems establishing synergies between them, as opposed to focusing on individual components and concepts. Public-private cooperation, coupled with stable political and regulatory frameworks, has fostered important innovation and breakthroughs in energy concepts. The Danish Energy Model has a threefold foundation: Energy efficiency, renewable energy and system integration/development including electrification.

The coherent integration of all three is essential, as the sectors support each other. Making the energy system efficient makes it possible to meet energy demands with renewables that would otherwise initially be disproportionately expensive. An integrated system is able to balance the use of renewables, like wind, with conventional sources, ensuring security of supply. Additionally it is crucial that the system is supported through a power exchange with the neighbouring countries. Also, the extended use of combined heat and power and district heating has allowed Denmark to integrate large proportions of wind into the energy system, e.g. in electrified heat production.

Teaming up supply and demand structures

The Danish Energy Model concentrates on renewables and energy efficient technology, as well as increasing energy consciousness and altering consumer behaviour. Incentivized to reduce energy consumption through initiatives, such as improved energy standards for buildings, energy labelling schemes for electrical appliances, public campaigns to promote energy savings in households and energy saving agreements with industry, the energy policy is well rooted in the everyday lives of Danish citizens and businesses. Danish environmental and energy taxes also contribute to a better reflection of the environmental costs of production, use and disposal in consumer prices on energy.

Henrik Breum
Special Advisor Centre for System Analysis, Energy Efficiency and Global Cooperation (+45) 3392 7812