Danish energy company suspends fixed rate contracts

A local Danish energy provider has suspended fixed rate contracts with private and business customers.

Danish energy company suspends fixed rate contracts
An illustration photo of an electricity meter. A Danish electricity provider has ripped up fixed rate contracts amid soaring costs. Photo: Kristian Djurhuus/Ritzau Scanpix

Recent months have seen both households and companies in Denmark suffer from drastic increases in the price of electricity. The effects are now impacting electricity customers who signed deals to protect themselves against price changes, broadcaster DR reports. 

Electricity provider SK Energy, which is located in the Zealand town of Slagelse, made the decision to suspend fixed rate business and private contract in light of rocketing electricity and gas prices, DR writes.

The decision was described as regrettable but necessary by the company’s CEO Henrik Birch.

“This is a highly unusual situation and I can only deeply apologise for us doing this. But I think we have to do it because we don’t know what will happen this coming winter,” Birch told DR.

The CEO also said he understands customers who feel let down after signing fixed rate contracts to protect themselves against price changes, DR writes. He added he hoped they would understand the nature of the situation.

The changes take effect three months from now.

The average price of electricity in Denmark was in May reported to have climbed 18 percent from the last quarter of 2021 to the first of 2022.

Several factors are behind the upward trend in the price of electricity, but the primary reason is the cost of natural gas, which has multiplied since late 2021. That has resulted in higher overheads for electricity suppliers. Gas supplies from Russia to Europe have meanwhile broken down following the Russian invasion of Ukraine.

READ ALSO: ‘Shop around’: Danish agency as electricity prices climb 18 percent in three months

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Copenhagen to retain but reduce Christmas lights amid energy crisis

Christmas lights on Copenhagen’s central shopping street Strøget will be partially switched on this winter, with savings necessary due to high energy costs.

Copenhagen to retain but reduce Christmas lights amid energy crisis

The decision was confirmed by the head of the Copenhagen traders’ association KCC, Michael Gatten, to local media TV2 Lorry.

“We have to make sure that retail here can attract visitors and Copenhageners. Christmas decorations are a precondition for revenue in shops and cafes. And it’s also a tradition,” Gatten said.

“Copenhageners and people from elsewhere come for a cultural experience of seeing the Christmas decorations in the Inner City,” he said.

Christmas lighting will however be reduced compared to recent years. Energy consumption for the decorations is to be 60 percent lower than last year, according to the report.

To achieve this, the lights will be switched on between 3pm and 9pm. Last year, lights in most streets were on from 7am until midnight.

Additionally, lights will first be used on November 27th, the first day of advent – two weeks later than in 2021.

Several municipalities in Denmark are considering reduced street lighting to save energy this winter, while some towns have cancelled their regular winter ice skating rinks.

Most of Copenhagen’s Christmas lighting energy bill is paid by the KCC trade association, with Copenhagen Municipality also contributing.