Debate contribution by Annika Lund Gade, brought to the Alting on 7 September 2022.

Global warming. Climate crisis. For many, these are very abstract concepts. Or it has been. Because despite the fact that the news stream is full of stories about war in Europe, galloping energy prices and an impending general election, there is also another type of story that is gradually filling the media picture very well. Stories of New Extreme Weather Records; extreme drought, extreme rainfall, floods, forest fires. Global warming is no longer abstract, it has become quite concrete now that it is increasingly affecting our own weather. And our food system. Because food production takes place out there in the 'climate', and as the consequences of global warming set in, our task becomes twofold – to reduce our total greenhouse gas emissions and prepare our food production systems for a new, more extreme reality.

Shift focus from maximization
In the big, global picture, Denmark's contribution to food production is very small. Therefore, our focus must not be on maximizing our own food production, but on developing the technologies and cultivation methods that are part of the green transition towards sustainable agriculture. We can export this knowledge, and in that way ensure a far greater effect than we could even dream of achieving within our own national borders. We've done it before. The transformation of agriculture can become a new wind turbine adventure.

In the Green Transition Denmark, we believe that agriculture, in line with other industries, should be covered by a general tax on greenhouse gas emissions – a CO2 equivalent (CO2e) tax that includes all greenhouse gases. Including specifically nitrous oxide and methane, which make up the vast majority of agriculture's greenhouse gas emissions.

A tax is the most economically cost-effective way to achieve the necessary reductions in greenhouse gas emissions. With a tax, a clear financial incentive is created for the individual farmer to reduce the emissions from his own farm most effectively. Therefore, it will also be the measures that cost the least per tonnes of CO2e reduced, which will be prioritized. The farmer's knowledge of his own farm and preferences come into play in this way, instead of it being, for example, a central authority that has to decide whether a certain technology or practice is to be established, whether production is to be rescheduled, whether land is to be set aside of operation, plant forest etc. The revenue from the tax can be returned to agriculture as support for the transition, for example as subsidy schemes for new technology, restructuring support and climate advice. And in this way the knowledge, experience and technology that we have to export abroad is developed.

Can accelerate other environmental problems
The climate crisis is not the only environmental challenge for agriculture. If we do not look at the whole ecosystem, we risk forgetting or even accelerating other environmental problems in our pursuit of CO2 reductions. We have a responsibility to ensure that our food production is future-proofed and adjusted to operate within all the planetary limits in terms of climate, but also nutrients, biodiversity and resource consumption. Therefore, the CO2e tax must be thought of together with the EU's agricultural support scheme and other initiatives within the improvement of the water environment, biodiversity and circular economy. The socio-economic calculations for means of action must therefore include both positive and negative side effects, as this can be of decisive importance for the prioritization of means of action. Previous calculations of climate change measures for agriculture clearly showed that when synergy is taken into account – especially effects on the water environment – ​​the social economy of climate change measures is much better. 

Start with simple fee model
Agriculture is characterized by a large import of e.g. feed and fertiliser, and feed imports in particular are associated with large greenhouse gas emissions and negative environmental effects. A climate tax on agriculture's national greenhouse gas emissions will increase the incentive for imports, e.g. of soy, as the production of imported goods does not count in the Danish CO2 accounts. Such imports will shift emissions abroad instead of reducing them. Measures are therefore needed to avoid this. We have already come a long way via support for Danish protein sources such as horse beans and grass refining as an alternative to soy imports. But the conventional soy in particular is so cheap that the Danish protein sources cannot yet compete. Therefore, further measures are needed here.

Finally, we recommend that the climate tax on agriculture be phased in at the same time as the general CO2 tax. It cannot be emphasized enough how busy we are with the green transition. It is therefore crucial to introduce this financial incentive as soon as possible. We therefore recommend starting with a relatively simple fee model that is very flexibly put together so that it can be expanded and developed continuously.