Introduction
The Danish government has on 26 June 2023 released a draft of new legislation aiming to simplify and expedite the process of repowering existing offshore electricity production facilities. Repowering involves the refurbishment of renewable energy production plants, including the partial or complete replacement of systems and equipment to enhance capacity and productivity. This article will highlight the main points of the upcoming, proposed legislation and the considerations behind it.
Current Regulations
The definition of repowering as stated in the VE II Directive is implemented in the Danish Electricity Supply Act §5, no.27. The Renewable Energy Act also adopts the same definitions. According to these acts, repowering involves the renewal of renewable energy production facilities, including the replacement of equipment and systems to replace or increase capacity.
In Denmark, permission to utilize energy in the Danish territorial waters and exclusive economic zone is granted according to the rules outlined in the Renewable Energy Act. Establishing new energy production facilities, including those utilizing wind and water, as well as significant modifications to existing facilities, require prior authorization from the Minister of Climate, Energy and Utilities.
Proposed Amendments and Considerations
To comply with the VE II Directive's provisions for a simplified and fast-track authorization process for offshore repowering projects, the Danish government has proposed granting the Minister of Climate, Energy and Utilities the authority to establish specific rules to simplify and enhance transparency in the application and approval process for repowering projects on the sea. These rules will be outlined in a forthcoming regulation (executive order) expected to take effect on January 1, 2024.
The Ministry proposed a broad delegation of authority to the Minister due to the evolving nature of offshore repowering projects and the absence of definitive design parameters at the time of the legislation's proposal.
Proposed Arrangements
The proposed legislation includes the insertion of a new provision, §29b, no. 3, in the Renewable Energy Act, which grants the Minister of Climate, Energy and Utilities the authority to establish specific rules to simplify and expedite the application and approval process for repowering existing renewable energy production facilities on the sea, as outlined in §§25 and 29 of the Act.
The forthcoming regulation will provide guidelines to simplify and increase transparency in the approval process for repowering projects, ensuring that significant changes to existing facilities covered under §25, no. 1, necessitating approval, are clearly defined. The regulation will also determine which repowering applications fall outside the scope of such guidelines.
According to the government it is important to note that the delegation of authority and the subsequent regulation will not impact the jurisdictional responsibilities for processing approvals related tothe provisions outlined in Article 16 of the VE II Directive.
Conclusion
The Danish government's proposed legislation aims to streamline and expedite the process of repowering existing offshore electricity production facilities. By granting the Minister of Climate, Energy and Utilities the authority to establish specific rules, the government intends to simplify the application and approval process for repowering projects.
It remains to be seen if such measures will contribute to development and expansion of renewable energy generation in Denmark's territorial waters and exclusive economic zone.
WSCO law firm advises both developers, investors and contractors in the offshore wind industry, on both corporate and commercial law matters, as well as on the regulatory framework for offshore wind in Denmark.
WSCO will continue to monitor legislative developments in this highly dynamic and import industry sector.
