Denmark is proving itself to be a decarbonisation leader, happy to turn its back on its history of oil and gas production and heavy reliance on coal. Its ambitious goal of cutting GHG emissions by 70% by 2030 makes it a global policy frontrunner, second only to Finland which aims to be climate neutral by 2035. Thibault Menu references his report for IFRI that asks what makes Denmark special. It has a long tradition of providing stability and predictability in energy policy. There is a high level of participation from public and private actors. It backs innovative technologies that are brought to market through generous policy schemes. Both policy and its implementation are made simpler thanks to the relatively flat social structure of Danish society and high level of institutional trust. Its geography and high wind speeds give it an advantage committing to wind power. Its power grid is one of the most interconnected in Europe, enabling the export and import – and therefore commercialisation – of excess power. Aside from wind, other successes include combined heat and power (CHP) and district heating. Menu notes that questions remain over the sustainability of biomass, a major source of heat power, and the country’s current total primary energy supply still relies on 60% fossil fuels. Today Denmark is a valuable case study. If it keeps to its plan it can become a role model.
In recent years, Denmark has steadily emerged as a leader and role model in the global green energy transition. Its greenhouse gas (GHG) emissions since 2010 have been reduced at greater pace than those of the European Union (EU) average.
This transformation is all the more impressive, given that the country used to be a significant oil and gas producer which also relied heavily on coal for power generation. From its highly publicised success in offshore wind to its ambitious goal of cutting GHG emissions by 70% by 2030 – which would put Denmark as a European and global frontrunner, with only Finland being more ambitious and planning to be climate neutral already by 2035 – as well as its pioneering green energy policies, the country has transformed itself into a beacon for low carbon technologies and public policies. The country has a record high share of renewable energy sources in power generation, with wind in the lead.
A model for other nations
Given the recent announcements and climate goals set by the Von der Leyen Commission, Denmark serves as an interesting case study for other European and world nations alike on how to embark on their own energy transitions. This paper assesses whether the country is really successful in accelerating even more than its European peers in its decarbonisation process. And if so, what is so special about Denmark and what can be learned from its transformation?
Policies range from well-publicised successes, such as the country’s ability to nearly rid itself from coal in its power mix in less than thirty years by increasingly developing its wind power potential, in leading the offshore wind segment and championing repowering, but also its lesser-known achievements, such as the diffusion of combined heat and power (CHP) and district heating across the country. Another success point of the country’s strategy relies in promoting energy efficiency in the industrial sector as well as its use of energy taxation for enhanced decarbonisation, even in challenging sectors such as transportation.
Questions remain open, especially concerning the sustainability credentials of biomass, a fuel which is a key component of the country’s energy mix, but also the future role of natural gas, which has an important balancing role in power generation, given the country decision to rid itself of oil and gas (O&G) production by the middle of the century.
To a large extent, the Danish success story so far can be linked to a combination of socio-political factors including:
- a high level of stability and predictability in energy policy stemming from Denmark’s long historical tradition of broad energy agreements,
- a cross-sectoral and holistic approach to developing the nation’s energy policy involving a high level of participation from various public and private actors,
- a willingness to back innovative technologies, combined with generous public policy schemes in order to bring them to market-level competitiveness. Next frontiers will consist of large-scale carbon capture and sequestration projects, as well as low carbon energy islands.
Geography, grids, society
However, it would be somewhat reductive to simply equate Denmark’s success story to these previously mentioned factors. Indeed, the Scandinavian nation also benefits from certain geographical dispositions which are great assets for its path to decarbonisation. For one, the country is ideally placed to develop variable renewable energy sources, most notably wind power given its topography and its strong wind resources.
On top of this, Denmark also benefits from an incredibly reliable and interconnected power grid thereby making renewable energy integration into the wide energy system all the easier. In addition, the fact that its power grid is one of the most interconnected in Europe entails that excess renewable energy production can quickly be exported when the wind blows, just as imports can hastily be called upon when wind is found to be lacking.
Finally, from a more socio-political perspective, the relatively flat social structure of Danish society as well as the country’s high level of institutional trust, makes policymaking and policy implementation simpler as well as more effective than in other European states.
As such, although this paper identifies important lessons to be learnt from Denmark’s decarbonisation strategies, the context as well as the particular characteristics of the country in which these were implemented should nevertheless be considered when seeking to establish similarly successful carbon reduction policies.
In any case, Denmark is still far from coming close to achieving its objectives and will have to accelerate its decarbonisation on all fronts: the country’s current total primary energy supply still relies on 60% fossil fuels.
Thibault Menu was recently a research assistant at the IFRI Centre for Energy & Climate and now works for Kayrros
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