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31 January 2022

Arla and Better Energy sign record green PPA on four solar parks

Four new solar parks will cover about one third of Arla’s electricity consumption in Denmark from 2024. This is the outcome of a new, ambitious collaboration between Arla and renewable energy company Better Energy. The solar parks will produce approximately 250 GWh of green electricity per year. This corresponds to the average annual energy consumption of 156,000 Danes and is thus the largest ever supply of new subsidy-free green electricity through a power purchase agreement from a Danish company.

Arla has just announced a new 2030 climate target to double CO2 reduction in operations from 30 to 63 per cent. As part of this new climate strategy, Arla will convert to 100 per cent green electricity in Europe before the end of 2025. This is to be achieved primarily through purchase agreements for green electricity and investment in wind and solar projects. Now, Arla is ready with the next big step on this part of their climate journey.

Arla and Better Energy have entered into an agreement on the establishment of four new solar parks. Over a 10-year period, Arla has committed to purchasing most of the power output from the parks. This collaboration marks the largest power purchase agreement in Danish history supplying new and additional subsidy-free green electricity to the grid.

The parks will produce approximately 250 GWh, corresponding to the average annual energy consumption of 156,000 Danes. The agreement will cover about one third of Arla Denmark’s total electricity consumption. A significant proportion of Arla’s emissions from dairies and logistics is linked to precisely that, says Country Director at Arla Denmark Helle Müller Petersen. Consequently, it is Arla’s clear goal to convert to 100 per cent green power by the end of 2025:

“Already today, our nearly 300 organic farmers and our largest dairies use exclusively green electricity. The agreement with Better Energy is another step on the way to being self-sufficient in green electricity, and at the same time it is a way in which Arla can contribute directly to adding new green energy to the Danish power grid”.

Subsidy-free green energy in early 2024

The first solar power production from the parks is expected from early 2023, and all the parks are scheduled to supply electricity by the beginning of 2024. Better Energy owns and is responsible for the construction, operation and maintenance of the solar parks that total 280 hectares. They welcome the new collaboration with Arla:

“We are pleased that Arla has chosen to buy new green electricity that has a real effect on the green transition in Denmark. Arla has an extensive production infrastructure in Denmark, and it is evident that it must be operated with sustainable, fossil-free, Danish-produced electricity. There has been somewhat of a revolution in solar power in recent years, and it is both a positive development and a wise choice by Arla to think solar power into their value chains,” says Rasmus Lildholdt Kjær, CEO of Better Energy.

The four solar parks will all be located in Denmark. The first park will be built in Ebberup in Assens Municipality, while the final location of the remaining three parks is awaiting approval.

Facts about the solar parks

  • The solar parks will produce approximately 250 GWh, corresponding to the average annual energy consumption of around 156,000 Danes.
  • In collaboration with Better Energy, Arla has entered into a 10-year agreement (power purchase agreement), in which Arla commits to purchasing most of the electricity from the four solar parks.
  • The solar parks are the outcome of the largest power purchase agreement in Danish history that supplies new, additional and subsidy-free green electricity to the electricity grid.
  • The new solar parks will consist of four parks at four different locations on Danish soil. The first park will be built in Ebberup in Assens Municipality, while the locations of the remaining three parks await final approval.
  • This agreement is a major step towards achieving Arla’s goal that 100 per cent of their electricity consumption in Europe must come from renewable energy sources by the end of 2025. This will mainly be reached through purchase agreements for additional green electricity and investment in wind and solar projects.
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