April 11, 2012. Dong Energy A/S, Denmark's state- controlled utility, plans to invest about 500 million pounds ($795 million) to convert three of its coal- and gas-fired power stations to generate heat and electricity from wood pellets. The Danish plants will have a capacity of about 1 gigawatt. Denmark plans to cut its energy consumption by 12 percent by 2020 from 2006. It already gets 70 percent of its renewable-energy use from biomass such as straw, wood and waste. Lower taxes on biomass than coal and gas power generation encouraged Dong Energy to convert the plants. The decision on whether to proceed depends on securing environmental permits and long-term agreements with heating customers. Dong, which owns 17 coal and gas- fired power plants, plans to lower carbon-dioxide emissions in power and heat production per energy unit produced to 15 percent of 2006 levels by 2040, according to its website. In 2010, 14.5 percent of the company's power output came from wind energy.