Denmark's DONG drops coal projects in UK, Germany

* DONG Energy drops coal projects in Scotland and Germany

* Says to focus on low-carbon technologies

* Says still undecided on Greifswald coal power plant

COPENHAGEN, Oct 12 (Reuters) - Danish state-owned DONG Energy [DONG.UL] has dropped plans to build a coal-fired power station in Scotland and another in Germany for environmental reasons, a senior executive said on Monday.

The company has cancelled plans plants in North Ayrshire, Scotland, and Emden, Germany, but will proceed with a project at Humberside, England, by fitting it for gas and biomass rather than coal.

“We wish to create a greener profile,” Executive Vice President Niels Bergh-Hansen told Reuters.

DONG Energy now gets 85 percent of its electricity from fossil fuels and 15 percent from renewable energy sources, mainly wind, but the strategy is to reverse those numbers in about 30 years.

“There are several ways of doing this, for example by using CCS (carbon capture and storage) technology, which removes CO2 from the fumes and stores it elsewhere,” Bergh-Hansen said.

“But this technology is unlikely to be commercially available this side of 2020,” he said.

So in the shorter term, DONG Energy’s strategy is to switch from coal to biomass and to install more wind power capacity.

DONG is already the world leader in offshore wind parks, and further wind developments will be part of its transformation.

But after 2020 a wide range of new renewable energy technologies will be on the scene, Bergh-Hansen said.

“There will be new technologies in the years up till 2050 that we haven’t even heard of today,” he said.

DONG's decision to drop the UK and German coal-fired projects is part of a wave of project rethinks, which most recently included Germany E.ON's EONG.DE postponement of an investment decision on a new coal power plant in Kingsnorth in Britain. [ID:nL7082010]


In Germany, DONG Energy is still planning to build a new coal-fired power plant in Greifswald, Bergh-Hansen said.

“The project is so far advanced that it would be very costly to give up at present,” he said.

DONG has received a building permit for the plant but still awaits environmental approval from the authorities after which a decision will be made on whether to carry out the project.

“The big question is ‘What are you against?’ Are you an opponent to coal or an opponent to CO2?” Bergh-Hansen asked.

He estimated that the Greifswald power plant would be able to reduce CO2 emissions by 12 million tonnes per year compared to old, less efficient plants currently in operation at Greifswald in Mecklenburg in eastern Germany.

DONG Energy last week said it would reduce net investment in 2010 and 2011 to lighten its debt load and strengthen its capital base. [ID:nDKT004653]


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