Public consultation concerning the deployment of the CCS fund

On 20 September 2023, a majority in the Danish Parliament signed an Agreement on strengthened framework conditions for CCS in Denmark (in Danish: “Aftale om styrkede rammevilkår for CCS i Danmark”). The agreement merged the second phase of the CCUS fund (as established by the Danish Climate Agreement for Energy and Industry of 22 June 2020) and the GSR fund (as established by the Agreement on green tax reform for industry of 24 June 2022) into one combined fund (the “CCS fund”). Since then, a political decision has been made to deploy the CCS fund through one competitive bidding process. The fund will provide subsidy for a value chain for carbon capture, transport and storage (“CCS”). The Danish Energy Agency (“the DEA“) is responsible for the deployment of the CCS fund. The overall framework for the CCS fund is set out in the Agreement on strengthened framework conditions for CCS in Denmark of 20 September 2023. It is noted that the granting of subsidy under the CCS fund is a subsidy scheme encompassed by the European Commission’s Guidelines on State aid for climate, environmental protection and energy 2022 (“CEEAG”). The DEA will notify the CCS fund to the European Commission as an aid scheme in accordance with the procedure prescribed by Article 108 under TFEU and the granting of subsidy and conclusion of one or several Contracts under the CCS fund is dependent on the European Commission’s prior approval. The DEA is currently in the process of preparing the competitive bidding process for the deployment of the CCS fund. On 18 December 2023 the DEA initiated a market dialogue and thus invited all interested market operators to provide written contributions on selected themes and questions with the possibility of the DEA inviting a limited number of operators to participate in dialogue meetings. Reference is made to prior information notice no. 769507-2023 as amended by notice no. 775322-2023 and the DEA’s website https://ens.dk/ansvarsomraader/ccs-fangst-og-lagring-af-co2/ccs-udbud-og-anden-stoette-til-udvikling-af-ccs, see the tab “Udbud af CCS-puljen”, where the invitation to the market dialogue and a summary note dated 26 February 2024 is published. This prior information notice concerns the DEA’s public consultation that the DEA must conduct according to section 4.1.3.4 of CEEAG including the DEA’s current assumptions and considerations regarding the deployment of the CCS fund. The DEA wishes to invite all interested operators to provide written contributions to the public consultation. The public consultation will provide an opportunity for potential bidders and other relevant market actors to contribute to the DEA’s considerations in the preparation of the tender material. It is emphasised that all operators who have an interest in the CCS fund (regardless of e.g. which part of the CCS value chain the operator belongs to) are invited to submit written contributions to the public consultation. The DEA has published a note on the DEA’s website https://ens.dk/ansvarsomraader/ccs-fangst-og-lagring-af-co2/ccs-udbud-og-anden-stoette-til-udvikling-af-ccs, see the tab “Udbud af CCS-puljen”, which includes e.g. the DEA’s current assumptions and considerations regarding the competitive bidding process. The note also includes information on how to participate in the public consultation and the dead-line for submitting written contributions. Input received after the deadline might not be taken into consideration by the DEA. The written contributions may potentially be elaborated on in writing and/or discussed at dialogue meetings between the operator and the DEA if deemed relevant by the DEA. The DEA may ask a limited number of operators specific additional questions and/or invite a limited number of operators to participate in dialogue meetings regarding additional questions. If the DEA deems it relevant to ask the potential bidders additional questions, the DEA expects that such additional questions to the potential bidder will be published on the DEA’s website. The DEA might also publish additional information about assumptions and considerations regarding the competitive bidding process and/or documents for the foreseen competitive bidding process on the DEA’s website. The DEA wishes to emphasise that no final determinations and decisions have been made with respect to e.g. the legal framework and structure of the deployment of funds and the foreseen bidding process and that all aspects of the assumptions and considerations presented in the published note may be subject to change. In accordance with CEEAG the DEA will publish a summary after the public consultation regarding the input received in the public consultation. The estimated value stated in this notice reflects the total maximum available subsidy of the CCS fund covering the period from and including 2029-2044. The value is including VAT and including potential derived tax losses (in Danish: afledt afgiftstab). The value is specified in 2024-prices. The estimated date of publication of the contract notice, stated in this notice, is based on the DEA’s current expectations. The date might be subject to change.