In addition to pushing electricity tax close to zero and raising the existing standard welfare payment for families, a provision to delay payment of excess energy bills has also been approved.
As previously proposed by the government, the deal will allow energy bills exceeding 2021 prices to be paid at a delayed time and in instalments. The additional cost of the bill, not the entire bill, will be eligible for delayed payment. The option will be available to both businesses and individuals.
Parliament has agreed the new measures to provide additional help to people, particularly families, who are struggling with energy costs. The deal was scheduled to be presented at the Ministry of Finance on Friday.
Some of the measures won’t kick in until the new year, however.
A core component of the package includes lowering the electricity tax from 69.7 øre per kilowatt-hour to 0.8 øre – equivalent to the minimum rate permitted by the EU – for the first six months of 2023. An øre, literally translating to ‘ear,’ is a kroner-cent.
This measure alone is estimated to cost the Danish state 3.5 billion kroner.
Additionally, the family benefit sent to families in January 2023 will be temporarily increased by 660 kroner per child.
The benefit, which has the official name børne- og ungeydelse but is also commonly called the børnecheck (“child cheque”), is paid out quarterly to all families. It normally ranges from 966 kroner to 4,653 kroner per quarter, depending on the age of the child.
More money will also be set aside to help expand district heating and substitute gas boilers with more efficient forms of heating, broadcaster DR reported.
The total cost of the package to the government is around five billion kroner.
“To give Danish households more security, the government has reached a broad agreement on a delayed [energy] payment scheme, a lower electricity tax and increased child cheque,” Finance Minister Nicolai Wammen said in a press statement.
“With this agreement, all Danish households and businesses get a helping hand. The agreement doesn’t solve all problems but can give more security over the winter,” he said.
Parties on both the right and left wings have agreed to vote through the deal. These are the Liberals (Venstre), Socialist People’s Party (SF), Social Liberals (Radikale Venstre), Red Green Alliance (Enhedslisten), Conservatives, Denmark Democrats, Alternative and Moderates, along with the governing Social Democrats.
The deal could be officially adopted by parliament as early as next week, DR reports.