DONG Energy pledges to phase-out coal by 2023

Utility company DONG Energy has today (2 February) announced an "important step" in its green transformation, with a pledge to completely phase-out coal from its heat and power generation by 2023.

Since 2006, the Danish firm has reduced its coal consumption by 73%, mainly by converting operational coal-fired Combined Heat and Power (CHP) plants to run on biomass. As part of a financial overview, the firm’s president confirmed the phase-out date.

“We’ve decided to take the final step and phase out the use of coal at all our power stations. The future belongs to renewable energy sources, and therefore we’re now converting the last of our coal-fired power stations to sustainable biomass,” DONG’s president Henrik Poulsen said.

“We will continue the green transformation in 2017. We expect to complete the offshore wind farm Burbo Bank Extension, the bioconversion of Skærbæk Power Station and the REnescience plant in Northwich. And today, we have announced that we will completely phase out coal from our power and heat generation by 2023.”

The firm revealed late last year that it was also attempting to sell-off its oil and gas arm to raise funds for future renewables investment. Figures for 2015 revealed that DONG was producing 115,000 barrels of oil and gas daily. But with the financial briefing describing the arm as “discontinuing operations”, the company is hoping to strike a sale by the end of 2017.

Even before the sale takes place, renewables generation is now close to accounting for half of all of DONG Energy’s generation. The 2023 timeframe for the phase-out has also been accompanied by a goal to reduce carbon emissions by 96% against a 2006 baseline.

DONG Energy has been making strides to deploy renewables in the UK over the past few years, specifically with the acquisition and development the world’s largest offshore wind farm, Hornsea Project One, off the coast of Yorkshire.

The 1.2GW development will provide enough electricity to power more than a million UK homes. It is expected to be fully operational in 2020 and will have a capacity nearly double that of its nearest rival, the Walney extension.

Coal conversion

The firm’s reduction in coal generation has coincided with a huge upgrade in renewable capacity and the company has set aside a further $5.5bn to be spent mainly on offshore wind farms this year.

DONG Energy is also relaying this transition onto customers. Last year, the firm announced that it will offer UK businesses the chance to purchase renewable electricity at a subsidised rate, by absorbing cost premiums to ensure that green energy prices are no higher than traditional “brown energy” sources.

The consumer-facing approach to renewables has also seen the company turn to demand response to incentivise businesses. DONG Energy has a scheme in place that offers commercial customers financial rewards for turning down their consumption or increasing onsite generation when the wind isn’t blowing.

While many of DONG Energy’s CHP conversions have occurred in Denmark, the UK has also reaped the benefits of the wind provider’s green transition. The world’s first biogas plant that can handle unsorted and untreated household waste will be built in Northwich in Cheshire, by the firm, which will have an annual capacity of up to 120,000 tonnes of waste. It will be the first of its kind to handle previously untreated household waste using enzymes.

Matt Mace

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