10 companies shortlisted to vie for Denmark’s C02 storage funding

The Danish Energy Agency has prequalified ten companies eligible to submit proposals for funding available under its carbon capture and storage (CCS) initiative aimed at helping the country reach its climate goals.

The companies were selected from a larger pool based on their experience with CCS projects and activities, or with major infrastructure projects, the Agency said. The DKK 28.7 billion, or approximately $4.31 billion, funding is expected to help reduce Denmark’s annual CO2 emissions by 2.3 million tonnes from 2030.

“We are well on our way to establishing a market for carbon capture and storage in Denmark. And that is important, because it holds enormous potential for addressing the climate challenge,” noted Peter Christian Baggesgaard Hansen, Deputy Director General of the Danish Energy Agency.

“There is strong interest in the tender, and we have now identified the 10 companies that will be prequalified and get the opportunity to apply for funding. I am pleased that so many can see the opportunities in CCS in Denmark and want to contribute to reaching our climate goals.” 

In March, 16 companies applied to be prequalified to compete for Denmark’s CCS fund, which will cover the costs of capture, transportation and geological storage of fossil, biogenic or atmospheric CO2 over a 15-year contract period.

Now, AffaldPlus Affaldsenergi, ARGO CCS, E.ON Carbon Capture Solutions, Copenhagen ApS, Energnist CaptureCo, Fjernvarme Fyn Fangst, Gaia ProjectCo P/S, HOFOR DSS SPV, Kredsløb Holding, Ørsted Bioenergy & Thermal Power, and Aalborg Portland have been shortlisted for the funding.

One of the shortlisted companies, Ørsted Bioenergy & Thermal Power, won a 20-year contract for Denmark’s first full-scale CCS project in 2023.

According to Baggesgaard Hansen, CCS is one of several tools available to reduce Denmark’s CO2 emissions and move closer to its climate goals. He explained that the fund is designed to ensure actual reductions, so the money will only be paid out once the CO2 is stored.

The funding will be paid out per tonne of CO2 captured and stored. It must be captured within the country to be included in Denmark’s climate targets, but it can be geologically stored either in Denmark or abroad. 

As for the next stage, the prequalified companies have until August 26, 2025, to submit detailed project descriptions and bids, followed by a negotiation phase between the Danish Energy Agency and the bidders.

Final and binding offers are due by December 17, 2025, with contract awards planned for April 2026. The implementation of the CCS fund is subject to state aid approval from the European Commission.

The first-ever permit for a CO2 storage project in Denmark was awarded to INEOS E&P and Wintershall Dea for the Greensand Pilot Injection Project in late 2022. In March 2023, the partners completed the first injection of CO2 in the North Sea.