16 applicants pursuing Denmark’s $4.1 billion carbon capture and storage fund

The Danish Energy Agency has received applications from 16 companies in the call for its third fund for carbon capture and storage (CCS) projects, with DKK 28.7 billion (around $4.1 billion) available to help Denmark in its path to climate neutrality.

The CCS Fund will cover the costs of capture, transportation and geological storage of fossil, biogenic or atmospheric CO2 over a 15-year contract period, with the subsidies including a requirement for the commissioning of capture facilities by December 1, 2029, and full capture and storage from 2030.

Overall, it is estimated that the fund will reduce Denmark’s annual carbon emissions by 2.3 million tonnes from 2030, which corresponds to around 5% of the country’s total current emissions over a year.

In the third call for the fund, which expired on March 25, 16 companies applied, with the Danish Energy Agency now starting the assessment of the applications in order to select the 10 most suitable that will have the opportunity to participate in the tender.

The prequalified companies are expected to be announced before the summer. The deadline for submitting initial bids is August 26, after which the Agency will enter into negotiations with the bidders towards a final bid.

The deadline for submitting final and binding bids is expected to be December 17, with the contracts to be awarded in April 2026.

“We are very pleased with the great interest and that there are so many players who can see opportunities in contributing to the green transition via capture and storage of CO2,” said Peter Christian Baggesgaard Hansen, Deputy Director General of the Danish Energy Agency.

“This shows that we are well on our way to establishing a market for CCS in Denmark. It is an important piece in the work to achieve the Danish climate goals. Now it is our task at the Danish Energy Agency to drive the work forward so that the money in the CCS pool can be converted into concrete CO2 reductions.” 

The first CCUS pool, worth approximately DKK 8 billion, was secured by Ørsted, which will capture and store 430,000 tonnes of CO2 annually from 2026 and 20 years onwards. First CO2 capture and storage is expected to occur this year.

The second pool, the NECCS pool, was concluded in May 2024, when the Danish Energy Agency entered into a contract with three companies to ensure the capture and storage of 160,350 tonnes of biogenic CO2 annually in the period from 2026 to 2032.