European Commission Approves €626 Million Danish State Aid Scheme to Support Forest Planting

Strategic Insights -

The European Commission has approved a €626 million (DKK 4,672 million) Danish scheme to support afforestation, contributing to the EU's Common Agricultural Policy objectives of environmental protection and climate change mitigation and adaptation. The measure is part of the Danish political agreement to convert 10% of Denmark's total land area into nature and forest by 2045. The scheme will run until 31 December 2030 and will cover the costs of planting forest on agricultural land, forest maintenance, and foregone agricultural income.

Key Takeaways:

  • The Danish scheme aims to convert 10% of Denmark's total land area into nature and forest by 2045, as part of the country's commitment to a green transition.
  • The scheme will cover up to 100% of eligible costs, including planting, maintenance, and foregone agricultural income, for landowners who convert agricultural land into forests.
  • The European Commission approved the scheme under EU State aid rules, finding it necessary and appropriate to meet Denmark's afforestation goals and foster forestry development in the context of climate change.
  • The aid will be provided in the form of direct grants to owners of agricultural land suitable for afforestation and will take effect until 31 December 2030.
  • The scheme aligns with the 2022 Guidelines for State aid in the agricultural and forestry sectors and in rural areas, which provide a flexible framework to help Member States support national measures and contribute to EU goals.
  • The non-confidential version of the decision will be made available under the case number SA.118866 in the State aid register on the Commission's competition website.

Statistics:

  • €626 million: The total amount of the Danish State aid scheme approved by the European Commission.
  • DKK 4,672 million: The equivalent amount in Danish Kroner of the scheme.
  • 10%: The percentage of Denmark's total land area to be converted into nature and forest by 2045.
  • 2045: The target year for achieving the 10% afforestation goal in Denmark.
  • 31 December 2030: The end date for the scheme.

Sources:

  • European Commission press release: "Commission approves €626 million Danish State aid scheme to support afforestation" (August 27, 2023)
  • European Commission State aid register: Case number SA.118866
  • 2022 Agricultural Guidelines for State aid in the agricultural and forestry sectors and in rural areas (European Commission)
  • European Commission competition website (Competition Weekly e-News)