District heating is the dominate heating solution for households in Denmark, accounting for a 63.3% share of the market, increasing from 61.3% in 2008. Denmark has committed great investment to district energy, including 500 million Euro for district heating in 2013.The number of households heated by district heating has grown with more than 100,000 over the period from 2008 to 2013. Individual heating with natural gas is second for market share, with 15.6% of the market.
District heating satisfies 63% of heat demand in Denmark and 98% of all buildings in Copenhagen are connected to district heating. The below graph demonstrates the fuels used to supply district heating, which shows that renewable sources have grown to a market share of 46.6%. The use of solar, as well as geothermal, heat has also grown considerably, but still only contributes 0.8%. Even though district heating dominates heat demand, heat pump solutions have grown from approximately 20,000 installations in 2010 to 45,500 in 2013, equivalent to 1.7% of the market.
Denmark has long-term policy goals for Danish energy supplies to further progress to more renewable energy sources and the government aims to eliminate fossil fuel use in electricity and heat by 2035. Furthermore, the policy statement aims to ban the installation of fossil fuel boilers in new buildings as of 2013 and aims to convert large-scale combined heat and power (CHP) plans from coal to biomass. CHP contributed to 66% of electricity generation in 2013, but CHP plants are encountering challenging economic conditions, due to the availability of cheap Nordic electricity.