Municipalities fear green slowdown due to government bonus proposal

The Danish Local Government Association (KL) expresses strong dissatisfaction with the government’s proposed incentive model for green energy, presented on Thursday. Martin Damm, the association’s chairman and mayor, warns that the model might halt the installation of wind turbines and solar panels. The proposition includes a 200 million DKK annual bonus to municipalities that erect the most renewable energy infrastructure on land, starting from 2026. Damm criticizes the funding approach, as it involves reallocating funds from the communal block grant, risking other municipalities potentially facing welfare cutbacks. Damm states that this could encourage municipalities to delay projects in order to qualify for the bonus. The government, represented by Climate Minister Lars Aagaard, acknowledges the competitive intent of the policy, aiming to motivate a ‘green contest’ among municipalities.