Black clouds over EU methane regulation – Denmark's efforts can break the cloud cover

Denmark's ambitious and proactive implementation of the EU's methane regulation can set a crucial precedent for a harmonized implementation across the EU. Denmark has shown that regulation is feasible. But without active defense of regulation, we risk throwing the baby out with the bathwater and thereby losing one of our fastest and most effective means of achieving our reduction goals and slowing global temperature increases.

Right now, the risk is that harmonisation will be a knee-jerk reaction to the lowest common denominator. This is because the Commission's official guidelines for implementation are still pending, while regulation is once again a model for significant pressure for deregulation and simplification. 

The EU itself describes the methane regulation as one of the most important climate laws, as it addresses emissions of methane, which is a short-lived but extremely potent greenhouse gas. So potent, in fact, that it warms the climate more than 80 times as much as CO2 over 20 years – which is why methane reductions also constitute the climate's emergency brake. 

Therefore, it is bad news when the pressure for deregulation continues. In the past week, five EU member states, Bulgaria, Romania, Slovakia, the Czech Republic and Hungary, have demanded that the regulation be postponed by two years. At the same time, the US ambassador to the EU claims in a recently published article in the Financial Times that the regulation could lead to a new energy crisis. The claim that methane regulation threatens Europe's energy security is also made by certain parts of the oil and gas industry and individual member states. Several analyze However, it shows that this is a fallacy. On the contrary, diluting regulation right now will only disrupt an already volatile energy market. and create instability for investors. Back in October 2025 urged 44 institutional investors, which together represent more than 4,85 trillion euros, therefore the EU summit to maintain the regulation.

The pressure comes before a expert group meeting for methane regulation this week. Here the Commission and the member states met to discuss and presumably standardize key elements of the regulation, including guidelines for fines and verification, which are under great pressure to be diluted. 

Denmark has done exemplary and proactive work with the implementation, meets all deadlines and actively contributes implementation experiences to the Commission and other member states. At the same time, Denmark's former Minister for Development Cooperation and Global Climate Policy Dan Jørgensen, as Commissioner for Energy and Housing, now has the main responsibility for the rollout of the regulation. He has made it clear that he believes the energy crisis will be the ultimate boost to the green transition, and he appeals to the member states to ensure just this from Brussels. With one of the EU's most important climate policies under pressure under the guise of energy security, Denmark's exemplary implementation should stand as a guiding star. A future Danish government can proudly lean into the thorough work of the Danish Energy Agency and cement Denmark's role as a green pioneer.

By |2026-05-05T11:59:03+01:0030. April 2026|Comment|Comments closed to Black clouds over EU methane regulation – Denmark's efforts can break the cloud cover
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Joint appeal to EU leaders from 26 international NGOs: Stay the course in implementing the EU Methane Regulation

Denmark is one of very few member states to have implemented the EU Methane Regulation both in a timely and ambitious manner, and the Danish methane law and executive order serve as inspiration for other countries. It sets a high but pragmatic standard with a focus on harmonisation across member states. At the same time, all member states are still awaiting the Commission's official guidelines, and in the vacuum where pressure on regulation continues to increase from many sides, Denmark's exemplary implementation should serve as a precedent so that the important harmonisation does not risk becoming a race towards the bottom. 

The EU itself calls the Methane Regulation one of the most important climate legislation in recent times, as it limits emissions from the extremely potent greenhouse gas methane, which, measured over a 20-year period, warms the atmosphere more than 80 times as much as CO2. 

But in recent months, the EU's regulation of methane emissions in the energy sector has once again come under intense pressure for deregulation from, among others, the US government, the fossil fuel and gas industry and individual EU member states. This is problematic because the regulation is central to limiting emissions of the powerful greenhouse gas methane and, not least, ensuring the EU's energy security in a time of geopolitical unrest. 

Therefore, the Green Transition Council, together with 25 international NGOs, calls on EU leaders to stay on track and ensure timely implementation of the regulation in line with its ambitions. Here, it is obvious to look to Denmark, which has shown that ambition on paper can also be translated into practice.

In the joint call, we emphasize that reopening or delaying regulation will only create further uncertainty at a time when the energy system is already under significant pressure. At the same time, it will undermine investors' confidence in regulation as a means to reduce risks in investment portfolios and support decarbonization goals.

When advocates of deregulation claim that supply pressures and the resulting price increases are due to the requirements of the EU Methane Regulation, this is a misdiagnosis. The fluctuations we are currently seeing are a direct consequence of geopolitical shocks such as the war in Iran and the accompanying destruction of energy infrastructure. Rather, the regulation supports the EU’s energy security by creating transparency and predictability – and any methane reduction that compliance with its requirements ensures is equal to captured gas. For example, the International Energy Agency estimates that methane reductions could have secured as much as 100 billion cubic meters of gas by 2024 – comparable to Qatar’s annual exports of liquefied natural gas.

The Commission and the Member States must therefore ensure a continued ambitious implementation of the Regulation and refrain from actions that delay or dilute it. This is necessary to mitigate climate change, ensure reduction targets and strengthen security of supply.

Read the invitation below:

Joint NGO letter: Methane transparency as a pillar of EU energy security

By |2026-04-22T08:22:42+01:0022. April 2026|Comment|Comments closed to Joint appeal to EU leaders from 26 international NGOs: Stay the course in implementing the EU Methane Regulation
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Joint call for a future government to phase out gas in Danish home heating

It is an important task in terms of economy, security and supply policy.

In 2022, energy prices came to the fore as Russia's invasion of Ukraine disrupted supply chains and gas prices rose sharply. Before that, gas prices in Europe had been very stable as imports were based on pipeline gas delivered under long-term contracts through established infrastructure.

After 2022, Europe has replaced pipeline gas from Russia with liquefied natural gas, LNG, where the world market for LNG sets the price on the European gas exchange. In 2026, gas prices will rise again, but this time due to the unrest in the Middle East and the closure of the Strait of Hormuz, where 20% of the world's LNG passes. 257.000 households still have gas as a source of heating. They are exposed to volatile gas prices when geopolitical developments take hold on the European gas exchange. Consumers with gas as a heating supply will be directly financially affected by developments on the international gas market, regardless of the amount of green gas and the degree of self-sufficiency in the Danish pipeline network.

“The ambition to phase out gas boilers by 2035 is already firmly established. Now the task for a future government is to deliver a plan so that we help customers move on from gas heating and prioritize gas resources where they contribute most to Europe's security of supply.” Says Britt Dam, advisor for Climate and Energy at the Green Transition Denmark.

Choosing a heat source is a decision with great personal financial significance. Therefore, we do not find it reasonable to put citizens with a gas boiler in sight, that gas is a future-proof, stable and cheap heat source. That this is not the case, we saw in 2022, we will see in 2026. We will see this in the future, regardless of the share of green gas and the degree of self-sufficiency. Because gas flows to where people will pay the most for it. And in Danish households, we have good opportunities to replace gas with far less climate-damaging solutions such as district heating and heat pumps.

The excess biogas can be sent south to the common interconnected gas network in Europe; one less gas boiler in Denmark reduces Europe's gas imports and the transfer of money to countries we do not want to support.

The phase-out of gas requires a clear direction

We recommend that the incoming government confirm the ambition to phase out gas in Danish home heating by 2035 and investigate the possibilities of expanding the ambition to also include oil boilers and wood pellet boilers. A concrete plan should be drawn up for the phase-out of gas boilers in Danish homes, which should provide clarity and help motivate gas consumers to choose district heating and heat pumps when replacing their gas boilers.

Let's get clarification and confirm the political agreement to phase out gas boilers in homes, so that we can ensure that Denmark has a future-proof heating supply.

The joint call is made by the Green Transition Denmark, Green Power Denmark, Concito, Danish Business, Synergi, the Consumer Council Think and Danish District Heating.

Also read the invitation below.

Phasing out gas in Danish home heating – joint call for new government

By |2026-03-31T10:03:07+01:0031. March 2026|Comment|Comments closed to Joint call to a future government to phase out gas in Danish home heating
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Danish Parliamentary Election 2026 – Our common future is green, electric and balanced

To create change, you have to be able to imagine the future. For us at the Green Transition Council, our shared future is green, electric, and where there is a balance between people, nature, and the environment. Below you can see how we get there by focusing on four crucial areas.

In recent years, we in Denmark have been through a roller coaster ride in the climate and environmental field. We have seen progress, decline and stagnation. In some cases, politicians have taken active action and got things done, while other cases and decisions have pulled us far back. Therefore, the three words climate, environment and biodiversity must be lifted right into the middle of politicians' field of vision again. We must act now - together - and we must do so for several reasons: for the climate, the environment, nature and biodiversity and thus also our health, economy, cohesion and security. It can also be said more briefly: for our own sake, our children and grandchildren.

Most of what we are pointing to has already been proven to have a big impact on our society. Now we need the right politicians and cooperation to make it happen. The next four years will make a big difference.

The greenest greetings

Green Transition Denmark

Four focus areas on the path towards a shared green future

Clean drinking water and a healthy ocean

If we want to be able to tap clean drinking water and bring life back to our oceans, we must address a particularly sore spot for our society: our consumption of chemicals. Substances like PFAS have been a kind of wonder chemical, making our kitchenware easier to wash, our clothes drier and industrial processes easier to run. But unfortunately, the chemicals have a serious downside. Study after study shows that they harm our health and environment, and they find their way into every corner of our society: drinking water, the marine environment, crops, livestock and our blood. Now, joint efforts must be made to turn off the tap, ban the harmful chemicals, develop alternatives, and clean up and tidy up.

Food for people with respect for nature

Agriculture must find the balance again, so that good quality food is produced for people and with respect for nature, climate and the environment. We must gain experience from those who are already taking action. The farmers who are converting to organic farming and working to reduce their climate footprint. The young people who are joining forces to produce food in a way that takes into account the aquatic environment, biodiversity, the soil and the well-being of animals. The Green Tripartite Agreement must reduce some of the nitrogen emissions to the aquatic environment and reduce agriculture's CO2 footprint further. But we must also have agriculture free of harmful pesticides, and that produces more plant-based food and has fewer cows, pigs and poultry. This benefits our environment, climate and health.

Green transport on the roads

Can you imagine walking through a city without the noise of car engines and smoke and smells from exhaust pipes? The way to get there depends on us getting more electric cars and buses on the roads, while fossil fuels have to put down their clogs. Unfortunately, many forces in the automotive industry are pulling the opposite way in the EU. At the same time, efforts are needed to get trucks and ferries to run on electricity, and to develop more green fuel for large ships and aircraft. Self-driving technology has great potential and can reduce the number of cars on the roads. A transformation of the transport sector will make a big difference to health, the environment and the climate, because today the sector is responsible for more than a quarter of the climate impact in Denmark and the EU.

Clean energy – a joint project

To slow down climate change, protect our environment, increase biodiversity and ensure cleaner air, we must completely end fossil fuels. We must stop extracting coal, oil and gas from the ground and burning biomass in heating plants. Instead, we must get all our energy from the sun, wind, water and geothermal energy. And we must save energy and use it more efficiently. The good news is that we have the technologies to base our society on renewable energy, but it must be rolled out, and it must be done in a way that makes sense − also for local communities. The green transition will only be fully successful when it is anchored and becomes a joint project.

By |2026-03-20T18:02:58+01:004. March 2026|Comment|Comments closed for the 2026 Danish Parliament Election – Our common future is green, electric and balanced
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The 2030 target is at risk: The Climate Council's status requires concrete action and a deal with overly positive assumptions

The Climate Council's status report provides a serious and necessary reminder that Denmark has no longer made it likely that the 2030 target will be achieved. The Council points out that several planned measures have not yet been implemented at the necessary pace. At the same time, the Climate Council emphasizes the need for a plan B if the targets are to remain credible.

This is worrying. According to the Danish Climate Council, when emissions in 2030 are higher than the government's climate projection from 2025 shows, it is mainly because the government's CCS tender appears to deliver fewer reductions than expected, and because the projections underestimate emissions from a number of areas, including agriculture, farmland and refineries. The Danish Green Transition Denmark believes that this calls for political action that ensures actual reductions rather than relying on optimistic assumptions.

Less technological one-sidedness and greater robustness in the energy system
The Climate Council points to challenges in connection with the CCS tenders and recommends a broader approach to support and instruments. Green Transition Denmark shares the assessment that Denmark must not become dependent on individual technologies, and that subsidies for transition elements other than CCS can be advantageously brought forward. Electrification and direct reductions should be the main path in a structural, long-term transformation. 

Stopping wood burning strengthens climate accounting
The Climate Council also highlights the need to strengthen net removals in the LULUCF sector and manage bioresources carefully. Green Transition Denmark further recommends a stop to the burning of wood for electricity and district heating from 2030. 

The use of Danish wood directly affects Denmark's climate accounts through the carbon balance in the forests. A stop will improve the climate accounts in the years after 2030 and contribute to raising the reduction level towards 2035. It reduces the need for uncertain compensation solutions and strengthens the transition to an energy system based on fossil-free electricity from wind and solar.

Uncertainties about potent methane require a national plan
The Climate Council points to uncertainties in several sectors, including agriculture and land use. A significant part of these uncertainties relates to underestimates of emissions and leaks from biogas production, manure management and livestock farming, all of which are associated with methane emissions.

Methane is a powerful greenhouse gas with a large short-term climate impact, which, measured over a 20-year period, warms the planet more than 80 times as much as CO2, and even small increases can have an impact on future climate goals. Similarly, reductions have a fast-acting effect on global warming and short-term climate goals.

The Council ofr Green Switchg therefore recommends that the government present a comprehensive national plan for methane reduction with measurement requirements, tighter methane limits and regulation of the entire biogas chain. A national methane reduction plan will also be a key element in concretizing the path towards meeting the climate target for 2035, as the Climate Council recommends the government do. Reducing uncertainties requires measuring and managing methane emissions much more systematically, and requires transforming agriculture towards less livestock production and more plant-based food production. 

The Climate Council's status report shows that Denmark cannot afford to let goal achievement rest on optimistic assumptions. Ambitious climate goals require timely implementation, a real Plan B and prioritization of solutions that directly strengthen the climate accounts.

By |2026-02-26T14:04:02+01:0026. February 2026|Comment|Comments closed to the 2030 target is at risk: The Climate Council's status requires concrete action and a deal with overly positive assumptions
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Road taxation and electric trucks: A new way forward

The road tax for trucks came into effect at the turn of the year, and it has already proven to be a success. Both Danish and foreignDanish trucks are now paying a small amount to drive on Danish roads, and since the payment is differentiated according to CO2discharge is there a incentive to choose less polluting vehicles

According to Sund & Bælt, around 300 million kroner has been collected in the first two months of the year. Most of the collections have been carried out correctly, but there have been some beginner's mistakes. It is not unusual for errors to occur in a large IT project that has to connect different hardware. However, it is positive that Sund & Bælt has control over the task, so that the road taxation can be rolled out to the entire public road network and hopefully soon can also include vans.  

Along with the road tax, an increase in the diesel tax of 52 øre is motivating for hauliers who want to switch to electric trucks. To support this transition, the Green Transition Denmark recommends that the Ministry of Transport accelerate the funding for the purchase of electric trucks and for the establishment of charging infrastructure at hauliers. Support is needed now, as electric trucks are more than twice as expensive as diesel trucks. 

Together with DTL, Mobility Denmark and Drivkraft Denmark, the Green Transition Denmark recommends that the remaining pool of approximately DKK 675 million be distributed in 2025 and 2026. Originally, the plan was to distribute DKK 125 million each year until 2030. Although this may have made sense when the pool was established, expectations from PWC show that it will become more economically attractive to buy electric trucks from 2027. Therefore, it is important to support the market now. 

There are three good reasons why truckers should switch to electric trucks. Firstly, electricity is a cheaper fuel than diesel. Secondly, we can produce electricity ourselves, which makes us less dependent on unstable foreign regimes. And last but not least, we will significantly reduce the amount of CO2 emissions. 

By |2025-03-18T09:05:59+01:0018. March 2025|Comment|Comments closed to Road Taxation and Electric Trucks: A New Way Forward
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The lack of offshore wind bids in the North Sea has shaken the government and Denmark's green transition

There were no bids for the large offshore wind supply in the North Sea. Zero. What causes it?
It depends, among other things, on together with the fact that great uncertainty has been created in the market due to the government's stop-and-go policy of the past year: Last year, the open-door scheme was abruptly shut down, which gave wind turbine companies the opportunity to set up offshore wind after a first-come, first-served principle, thus closing the door to 23 GW of additional offshore wind and creating new uncertainty in the market. Since then, new requirements were set for state co-ownership, tighter delivery times and lengthy mapping, which weakened the supply as a business case. Yes, there have also been additional costs in the wind turbine market, which since 2022 has struggled with increasing inflation throughout the value chain, but it is getting under control.

Last year, the German state received a total bid of DKK 94 billion. DKK from companies that want to set up 7 GW of offshore wind in the Baltic Sea, so if we had approached the process like the Germans and stuck to a reformed open-door system, instead of delaying and bureaucratizing the tender, Climate Minister Lars Aagaard would hardly stand around inventing bad excuses now. It is deeply disappointing that the Danish offshore wind adventure has come to a standstill. It damages the wind turbine industry, and the politicians should have red ears.

Lobbyists in the industry and the hydrogen business now claim that the companies cannot get finance in the wind projects because there is no clarity about the hydrogen pipeline to Germany. They are therefore pushing to get the state to put its hand on the stove here and provide money or state loan guarantees to build an expensive new hydrogen infrastructure. They do this because the green hydrogen produced in electrolysis plants will swallow large amounts of green electricity from the sea wind.

Havvinden's business cases cannot be fixed with a hydrogen tube

But the equation hardly holds. In reality, it is very uncertain that a good business case can be created for exporting large quantities of green hydrogen with a hydrogen pipe to Germany and spending up to DKK 130 billion. DKK over 15-20 years to build a new hydrogen infrastructure across the border. And there are several reasons for this:

Firstly: Green hydrogen cannot compete with direct electrification because there are large conversion losses compared to the technological alternatives powered by direct green electricity. Even a number of the heavy and energy-intensive industries, such as aluminum and steel, appear to be electrified, and up to 92-98 per cent. of Europe's industry can be powered by green electricity. Even innovative cement factories are on the move. We will see a price race between direct electricity and hydrogen, with the latter losing out. If nations invest in building large, heavy hydrogen economies and a heavy hydrogen gas infrastructure, they will be crushed in the global competition by the nations that, among other things, China puts green power into the economy.

Secondly: Hydrogen should be used sparingly and to a limited extent. We will need green hydrogen to produce the next generation of e-fuels for air and long-distance shipping, for e-fertilizers and the chemical industry. When you produce these green fuels with green electricity, it effectively corresponds to an indirect electrification of air and maritime transport, which can eliminate fossil fuels. But green hydrogen is very expensive to produce, and i.a. therefore, it should not be used in road transport and in the heating sector, because here the electrical solutions, which are much cheaper, win

Thirdly: Price always makes a difference. Green hydrogen is several times more expensive than fossil hydrogen, so it can only manage on the market with heavy government support if much higher CO2 taxes are introduced or the EU makes even tougher displacement requirements.

Fourthly: Competitive pressure challenges the business case for exporting green hydrogen. Although Denmark has enormous wind resources in the North Sea, green hydrogen from Denmark can hardly compete with the price of green hydrogen from Spain, France and North Africa, which not only have large amounts of wind energy, but are also enriched with much larger solar resources. Several analyzes show that green hydrogen from Denmark can be more expensive than, for example, green hydrogen from Spain, Polish onshore wind or Dutch offshore, and the Germans are hardly so stupid that they will buy more expensive hydrogen from Denmark if they can get it cheaper from other countries ?

Fifth: Localization is best. Global hydrogen production today is highly localized because it is both expensive, difficult and risky to transport hydrogen over long distances. It is the world's smallest molecule, and the risk of leakage – with fatal climate effects and major health risks – is significant. It takes three times as much energy to transport hydrogen as gas, and over a 30-year period, according to energy expert Paul Martin lose at least 10 times as much energy by transporting hydrogen over long distances as by sending green electricity through high-voltage lines.

Sixth: The German chemical industry is expected to demand a lot of green hydrogen in the future, but the problem for the Danish offshore business case is that land-based solar and wind in Germany are cheaper in lifetime costs than Danish offshore wind. The Danish state should not waste money on a hydrogen pipeline across the border to service the German chemical industry or Dutch refineries, because there does not seem to be a solid market pull or a sensible business case for it. Also in the future, it will be more cost-effective for the Germans and the Dutch to set up more wind turbines and solar cell systems - what they currently does at a much faster pace than Denmark – and then produces the green hydrogen locally where it is to be used. Likewise with Denmark.

Seventh: We need more green hydrogen in Denmark, so don't export the molecules. In the Green Transition Denmark's climate and energy plan for a fossil-free Denmark in 2040, we propose that more green hydrogen must be produced in Denmark, but that it must be used to locally produce e-fertilizer and e-fuels for the ships and aircraft on the long distances that bunker energy in Denmark. Highly localized industrial clusters should be built – e.g. in Esbjerg, Åbenrå and a few other places - where local production of both renewable energy and e-fuels can be scaled up in strong industrial clusters. It will also ensure more Danish jobs and more green value creation in areas that may otherwise be challenged by emigration to the larger cities. Calculations carried out by EA Energy Analysis for RGO show that in 2040, Denmark must produce approximately 90 petajoules of green e-fuels in order to decarbonize Danish ships and planes abroad. At the same time, the advantage is that it is much easier and cheaper to export e-fuels than the raw hydrogen molecules, if the demand is there in the market.

How to solve it: Put turbo on the electrification

So how to create a better business case for more offshore wind in Denmark? There is another, faster and more direct way than hydrogen to create increased demand for green electricity, and that is the direct electrification of all sectors. That transition should be accelerated, and here the politicians can make a big difference with forward-looking regulations.

Only 19 per cent of Danish society is electrified today, and that electrification has been stalled for the last two decades. One of the reasons see i.a. appears to be that green electricity has paid higher taxes, charges and grid tariffs than fossil fuels - at least if the latest figures published by European Energy are to be believed. Another reason is that massive government support has been given to the burning of wood biomass and biogas, which prolongs the combustion society. In this decade alone, over 30 billion is given. DKK in state support for biogas, and from 2022 to 2029 biomass burning will receive almost DKK 5 billion. DKK in direct state aid. That form of state support distorts the market in favor of combustion energy at the expense of the green power from renewable energy. And that delays the electrification of Danish society.

More than half of Denmark's energy consumption is still fossil, and if you add heating biogas and biomass, it is still up to 87 per cent. of all energy in Denmark that is burned. Only 13 per cent comes from completely clean energy solutions such as solar and wind energy, geothermal energy, hydropower and heat pumps. In the future, Denmark's fossil energy consumption and power plants should be electrified, which is also more efficient, as large energy losses are avoided in the process. In rough figures, it will require us to use three times as much green electricity in the future if we are to convert the existing fossil and biomass consumption into electricity. If this Danish electricity consumption is to be covered by offshore wind alone, one can safely list the 23 GW of offshore wind that was already in the open-door pipeline, which the government unfortunately slammed the door on.

The timing is important, and the expansion will realistically take place in several stages. The large energy islands in the North Sea and Bornholm have now been postponed because the project economics have become enormously expensive. There is no reason to cry about that. The construction does not fit together. The state does not have to pay for the expansion with offshore wind. Instead, you can choose a market-based development without requirements for state co-ownership and create a new model for profit sharing. Instead of running strict retail management on the part of the Danish Energy Agency, we can allow the developers of the renewable energy to bid themselves with the solutions in relation to capacity, net coupling and turbine density, as long as they meet set requirements for the environment and biodiversity. It is a new kind of open-door model, and Germany has shown the way, and they have received the European Commission's acceptance that it is also within the competition rules.

The wind developers must have a business case, and here the politicians have a very important role. It is not enough to make airy and hopeful future promises from Esbjerg to Marienborg. You also have to do your homework. Here, it is urgent above all to speed up the electrification of Danish society, so that the demand for green electricity increases in the coming years. We need to get out of the current stalemate. Politicians can start by removing all fossil subsidies, introducing a climate tax on wood biomass, lowering electricity taxes more and letting the state co-finance part of the electricity grid – as is also done in Germany. And then you should quickly clean up all the crooked support schemes that today massively favor the burning of wood biomass and biogas at the expense of solar and wind energy, heat pumps, geothermal energy and energy storage. And the double taxation of batteries should be removed, so that it becomes attractive to invest in future energy storage on batteries.

Far-sighted and proactive regulation is needed. You can, for example, adopt a 2035 end date for piped gas to households with gas boilers, and now ban the sale of new oil and gas boilers. Biogas can be used better and provides higher value if, for example, it is used to produce the next generation of e-fuels in aviation. The gas must not be burned off in people's households, because there are good alternatives in district heating and heat pumps. You should also ban the sale of new fossil-fuel cars from 2025/26 or put extra high penalty charges on new fossil-fuel cars so that they are priced out of the market completely. Preferably quickly.

A 100 percent electrification of road transport will, according to RGO's calculations require approximately 18-20 TWh, and according to figures from EA Energianalyse, electrifying road transport towards 2040 is a profitable private business. If the state subsidy for biomass is removed, and a climate tax is introduced on biomass burning, it can boost the electrification of the heating sector. Thus, industrial heat pumps and electric boilers, powered by clean solar and wind energy, will have a fairer competitive situation, which is only fair, as they are clean green heating solutions. A faster electrification of the heating sector, industry, road transport plus agricultural and construction machinery can increase the demand for green power in the coming years, and thus provide a better business case for the developers who want to set up solar cell systems or wind turbines on land and at sea. It is high time that the politicians took action in this toolbox.

Add green power to Denmark's competitiveness

The direct electrification of these sectors will be economically advantageous and strengthen Denmark's competitiveness. Green electricity produced with solar and wind is already cheaper than fossil energy, and it is a unique opportunity that Danish politicians should not let go to waste.
Electrification of all sectors in Denmark is actually much more important than betting on hydrogen export via a hydrogen pipe, for which the industry's lobbyists want the state's help. Towards 2035, there may not be more than 4-6 GW of green hydrogen production in Denmark. Perhaps Copenhagen Infrastructure Partners and other players dream of raising the figure to perhaps twice as much, but right now it seems that there is no business case for it, as many green hydrogen products do not reach the decisive investment decision .

In round numbers, 6 GW of hydrogen requires approximately 24 TWh of green power, and not much more is needed to produce e-fuels for planes and cargo ships that refuel on Danish soil. So instead of fantasizing about that hydrogen tube and imagining the Danes that it will cause our wind adventure to run aground, the politicians should get into work clothes and turbocharge the electrification of Danish society. We must also invest more in expanding the electricity grid for our neighboring countries. In the future, we must sell even more green electrons to our partners in the EU community, who must begin to free themselves from the fossil fuels that are currently imported for over DKK 390 billion. euros per year.

If the green transition is to speed up, it requires a sharp focus on the most cost-effective measures and having them scaled up more quickly. In Danish climate and energy policy, too much time and too many state subsidy kroner are currently being wasted on green hydrogen export, pyrolysis and CO2 capture. But you can get much more climate effect for the money if you instead focus sharply on electrifying Danish society and arrange support schemes, taxes and charges so that they promote more solar and wind energy, batteries, heat pumps and geothermal energy.

This is a slightly edited version of a comment that Bjarke Møller has written for the magazine Ræson, and which was published in the magazine on Wednesday 11 December 2024

By |2024-12-12T09:05:27+01:0012. December 2024|Comment|Comments closed to The lack of offshore wind bids in the North Sea has shaken the government and Denmark's green transition
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Is Denmark's Green Tripartite Agreement really as groundbreaking as it claims?

A historical agreement. That's how Denmark's latest political agreement – ​​the Green Tripartite Agreement – ​​is being described, as it introduces the world's first carbon tax on agriculture.

In December 2023, the Danish government established a 'green tripartite' of agriculture, environmental and industry groups to find long-term solutions to its climate and environmental challenges. After lengthy negotiations, an informal tripartite agreement was reached in June. With a parliamentary majority, the government expected the process of transforming this agreement into something more concrete to be straightforward. However, the negotiation was protracted, marked by debate, protests from environmental groups and an unlikely alliance of opposition parties from different wings. Despite these challenges, almost a year later, the Green Tripartite Agreement was signed on 18 November.

So, what are the key elements of the agreement? Here are the four defining areas of Denmark's latest announcement:

1. The world's first carbon tax
It is certainly historic that Denmark will introduce a carbon tax on agriculture, with the revenue going straight back into the sector. Starting in 2030, the tax will be €40 per tonne of CO2e from livestock, rising to €100 in 2035. But a 60 per cent base deduction means the actual tax rate will be much lower, just €16 per tonne in 2030 and €40 in 2035. As a result, the tax may fall short of driving the structural transformation needed to shift agriculture away from industrial animal production.

A few production adjustments and the use of technologies, some of which are already widely used, will in some cases be sufficient to exempt farmers from paying the tax altogether. However, there is a risk that this could undermine the carbon tax by allowing large scale industrial livestock production to continue business as usual or to invest further in technology and expansion. This could create a long term lock-in to industrial livestock production rather than incentivising more structural production changes.

2. Nitrogen pollution finally on the agenda
Another key battleground during the negotiations, between the government and an alliance of opposition parties from the left and right, was the urgent need for a reduction of nitrogen pollution. This year was the second consecutive year of historic oxygen depletion in Danish waters. The opposition's demands were largely met in the end, with a reduction goal of 13,780 tonnes by 2027. Despite these planned reductions, Denmark is still set to breach the EU Water Framework Directive, which requires all water bodies to reach 'good status' (good chemical and ecological status) by 2027. Currently only five out of 109 Danish waters meet this standard and recovery for some areas could take decades.

3. A new approach to land use
The Green Tripartite Agreement aims to enhance nature, tackle biodiversity loss and improve coastal ecosystems through land use changes. To achieve this, a green area fund of €5.8 billion will be created. More than 15 per cent of Denmark's agricultural land will be set aside, for the creation of 250,000 hectares of new forests and the rewetting of 140,000 hectares of carbon rich peatlands. Strategic land acquisition will be initiated for purposes including nitrogen reduction and land consolidation.

The changes will be driven by voluntary action by landowners through incentive schemes. However, experts question whether the incentives for farmers to give up land are strong enough to meet the targets. The agreement states that strict nitrogen regulation will come into force in 2027 if the voluntary schemes are not used, but the type of regulation is uncertain and will be decided in 2025.

4. Technological solutions have been prioritized
The agreement provides a further €65 million in subsidies for feed additives, such as Bovaer, and €1.3 billion for biochar storage through pyrolysis, a process that turns organic material into a stable form of carbon for long term storage in soil. There are dilemmas surrounding the use of these technologies. For example, while studies indicate that Bovaer can reduce methane emissions from dairy cows by up to 30 per cent, its use alone is not cost effective or sufficient to meet global commitments. While these technologies have a methane-reducing effect, they are not a panacea and may come with their own risks, such as incentivising more intense production practices. A structural transformation in agriculture, reducing livestock numbers, would be a far more effective and forward thinking solution.

Technology and voluntary measures are heavily relied on
The Green Tripartite Agreement is an important step forward for the green transition, particularly with its carbon tax and major land use changes. Other countries should take note that it is possible to put a price on agriculture's climate impact without widespread uproar. Hopefully, the changes to how we use land will lead to a reduction of industrial livestock farming. But, still, the agreement relies too heavily on technological solutions and voluntary measures. Although historic in some respects, its long-term success will depend on implementation and whether it can drive the necessary structural changes in the agricultural sector.

 

This blog post was written by Lærke Kjærbye-Thygesen, project employee at the Green Transition Denmark, and Niklas Sjøbeck Jørgensen, senior advisor at the Green Transition Denmark and was published in the Green Alliance Blog "Inside Track" on December 11, 2024.

By |2024-12-12T09:47:59+01:0011. December 2024|Comment|Comments closed to Is Denmark's Green Tripartite Agreement really as groundbreaking as it claims?
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The hidden green funds of the Finance Act

The other day, a number of media outlets chose to summarize the financial law agreement's contribution to the green transition in four points, which in total amount to DKK 430 million. DKK next year. But it is actually just a drop in the ocean of what will be given to the green transition in Denmark next year. Because did you know that more than 7 times as much is given to biogas? And 1 1/2 times as much is given in support to cogeneration plants that burn solid wood biomass.

If you zoom right in on the financial law agreement concluded between the Government, the Socialist People's Party and the Radical Left, you can find four results that have been highlighted as green. But how green are they? 400 million DKK the tradesman deduction for energy renovations, climate protection and service deductions. There are also three circular initiatives with DKK 15 million. DKK for deductions for repairs of white goods, DKK 10 million. DKK to develop a textile action plan and 5 million DKK to a partnership for takeaway packaging.

However, the way in which the tradesman's deduction is screwed up is quite problematic. Why should government funds be used for a service deduction of DKK 17.500? per person, which can also be used in relation to cleaning, window cleaning, childcare and garden help - also for well-to-do families who should be able to afford it themselves? And seen through green glasses, it would have been much better to spend all 400 million. DKK for energy renovations and climate protection.

The three new efforts in the circular area are so small that their green effects are relatively uncertain. Denmark needs a new resource strategy that effectively reduces our excessively high resource consumption – 25,9 tonnes per year. inhabitant per year, but then it will take a few years and a bit of hands to develop a textile business plan. It is fine to make partnerships for take away and promote a little more repairs of white goods, but who believes that 10-15 million DKK per year will move quite a lot? Instead, the climate and resource footprint of public procurement for DKK 448 billion could be much more effectively reduced. DKK per year, and it would be badly needed, because CO2e emissions from public procurement appear to be increasing, not decreasing, towards 2030.

In that light, the four "green" measures mentioned above are drops in the ocean. More symbolic politics than significant green measures.

The big winners

So let's instead go in search of the big green money in the Finance Act. That is, those that really express a prioritization. First, mention should be made of the implementation of the green tripartite agreement for agriculture, which, in addition to the parties behind the Finance Act, was also concluded with the Conservative People's Party and the Liberal Alliance. In 2025, DKK 4,6 billion will be realized here. DKK, where almost half goes to removing carbon-rich low-lying soils. This is really positive, because there has long been a rush to extract the low-lying soils, which release a lot of CO2 into the atmosphere.

DKK 782 million will also be given. DKK for increased afforestation, and DKK 1,2 billion DKK for a number of nitrogen-reducing measures, and our much-needed water environment really needs that. These are efforts that can contribute to promoting the green transition.

In the Green Transition Denmark, we still recommend that you go much further in terms of making a structural change in agriculture, away from intensive animal production and towards more plant-based production. There we must state that the implementation agreement for the green tripartite does not do away with intensive agricultural production, which in recent decades has had a very high price for nature and the environment. On the positive side, however, it should be mentioned that next year there will be 50 million to the plant fund and for the promotion of plant-based foods, and this amount will be increased in 2026 to DKK 80 million. DKK per year. Organic agriculture also receives a small helping hand of DKK 10 million. DKK These are not major transformative measures, but they are the beginning of a long journey.
Agriculture is still the big winner when the Finance Act's many billions are distributed. Together with the EU's support schemes, agriculture will receive over DKK 15 billion next year. DKK in state aid.

Biogas and heating with wood biomass will receive billions of dollars in support

If you go deeper into the Finance Act's many grants, however, there are also large amounts of support for parts of the energy sector. And no. It is not for sun, wind and heat pumps. Next year, DKK 3 billion will be given. DKK in subsidies for biogas. It is actually more than twice as much as the Ministry of the Environment gets to protect the environment and nature!

In 2025, 682,5 million has also been set aside. in direct support to cogeneration plants that burn biomass to transform it into electricity. This happens even though Denmark's heating with wood biomass has an immediate discharge of over 15 million tonnes of CO2, and the time-weighted emission after twenty years is at least 4 million ton per year. Over a twenty-year period, the large-scale Danish heating with wood biomass emits a whopping 114 million tonnes of CO2, but if the climate crisis is taken seriously, this practice should be phased out as soon as possible. However, that doesn't happen.

So it's a long nose for those who think that the state is really betting hard on wind and solar energy. In terms of support and deductions, this is not the case at all. Fortunately, there is already a good alternative to burning wood biomass. Because it is possible to electrify Denmark's entire heat supply. As gas and biomass heating is phased out, we can provide households with a cheaper heating solution with industrial heat pumps and electric boilers powered by green electricity from solar and wind energy. This is shown by the Green Transition Denmark climate and energy plan, which can ensure a fossil-free Denmark in 2040. A renewable energy system can deliver safe and stable energy to the Danes if you also invest in energy storage in dam heat storage and batteries. But neither solar and wind energy, heat pumps nor battery storage are prioritized in the Finance Act.

Landvind has an outlook of DKK 216,9 million. DKK in support, and the solar cells receive DKK 98 million. DKK Today, solar and wind are the absolute cheapest sources of energy on lifetime costs, and we need much more to free ourselves from fossil energy. Havvind receives DKK 238,8 million. DKK for screening/preliminary investigation plus DKK 254,4 million. DKK to offshore wind next year, but if you zoom out for the entire period 2022-2028, the government expects to earn over DKK XNUMX billion. DKK on sea breeze. So the needy wind industry has no prospect of getting a helping hand from the public.

More than half of Denmark's gross energy consumption is still fossil fuels, so we need much more solar and wind energy, but a lot of the tax dollars are being wasted on providing massive state support for biogas and biomass burning, where we could get much more in terms of energy economics and climate the money elsewhere.

We can get more bang for our buck

If the state wants a quick and large climate effect, priority should be given to solar, wind, energy efficiency improvements, heat pumps and electrification first. But unfortunately that doesn't happen. Even the subsidy for energy savings of 546,1 million DKK next year is far behind biogas and biomass. Perhaps the time has soon come to revisit the green transition and take a critical look at whether we could get much more bang for the buck by investing differently. Several of the existing support schemes and tax exemptions provide large direct and indirect state support to selected industries and energy sources at the expense of others. Under this, the direct and indirect state support for fossil energy, which amounts to up to DKK 3,6 billion, could be appropriately phased out. DKK per year. It is harmful in relation to achieving the climate act's goals, but in the finance act there will still be a good opportunity for energy-intensive companies and agriculture to continue to receive a full deduction for their payment of fossil taxes when they use oil, gas and coke.

And then we probably also need a critical discussion of whether it is okay for the Danish state to sell CO2 quotas for DKK 1871,2 million. DKK in 2025, which enables others abroad to emit extra greenhouse gases. In the period 2024-28, the government expects to earn a total of DKK 7,47 billion. on the sale of CO2 quotas. In RGO, we believe that these quotas should be cancelled, so that you do not actively promote climate leakage with the help of the state. The latest green agricultural agreement must also be partly financed in this way.

It is not because the Danish state lacks money for a green transition. But the main problem is that we still get far too little climate and environmental effect for the money.

By |2024-11-28T18:39:19+01:0025 November 2024|Comment|Comments closed to the hidden green funds of the Finance Act
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IMO closer to agreement on CO2 regulation, but obstacles remain

Global shipping has for decades avoided necessary climate regulation, despite being responsible for about 3% of global greenhouse gas emissions, equivalent to Japan's emissions. As around 90% of global trade takes place by sea, the sector's emissions are expected to continue to rise unless specific measures are taken.

At the beginning of October, delegates from over a hundred countries met in London for an important meeting of the International Maritime Organization (IMO). The aim was to find a common agreement on how to decarbonise international shipping and put the sector on track to reach net-zero emissions by 2050, as expressed in the IMO's Greenhouse Gas Strategy. Denmark, supported by its strong maritime industry, played an important role in trying to negotiate an ambitious but politically sustainable agreement home.

Bridging the gap between fossil fuels and e-fuels

Much attention was devoted to temporary measures that can effectively bridge the price gap between conventional fossil marine fuels and sustainable renewable electricity-based fuels, so-called e-fuels. The need for this is particularly clear in light of Ørsted's announcement to abandon its FlagshipONE e-methanol project in Sweden, even though the project had previously received a final investment decision.

Lack of demand and slow market progress have been cited as the main reasons for the termination. At the same time, shipping companies such as Maersk invest in dual-fuel ships, but find it challenging to secure the necessary quantities of e-methanol at a competitive price.

The IMO and its Member States thus have a unique opportunity to help solve this chicken-and-egg problem by creating a stable and predictable regulatory environment that can ensure demand for clean e-fuels in the years to come. A combination of regulations and financial incentives should provide the necessary boost.

Combination of economic and technical measures

Firstly, a binding sub-target for sustainable e-fuels and an ambitious but realistic target to reduce the carbon intensity of maritime fuels will both contribute to reducing emissions and guarantee a minimum uptake of e-fuels by 2030. In addition, a reward factor for use of sustainable e-fuels when calculating the carbon intensity of ships further encourage early adopters.

Second, a global CO2 tax on emitting fuels will help offset costs and make sustainable fuels more competitive. Its revenues can then be used to at least partially support least developed countries and small island states in their decarbonisation efforts, in line with the principle of just transition. In addition, financial incentives for e-fuel producers will help kick-start the production of e-fuels by providing targeted subsidies to reduce the price gap with fossil fuels.

Last but not least, establishing a strict definition of zero and near-zero emission fuels that takes into account their full life cycle is necessary to exclusively promote fuels with the potential for full decarbonisation. This would ensure limited uptake of transition fuels, which may appeal in the short term, but whose long term impact would cause more harm than good. Examples of these are biofuels, which carry significant environmental and biodiversity risks, or LNG, which releases methane, which contributes to global warming.

The countries are getting closer, but more needs to be done
There was a sense of urgency at the IMO meeting, particularly from small island states that are already experiencing the catastrophic effects of climate change. However, due to different views on several issues, in particular the universal CO2 tax, no agreement has been reached. The word that resonated most was "convergence". The list of options on the table is narrowed and there is a better understanding of where the proponents of the various measures are coming from.

Much attention has been paid to the effects of the universal CO2 tax on the most vulnerable states. While several studies have already confirmed that a higher tax combined with a generous fund financed by the revenue would have a net positive impact on LDCs and their GDP, attention has now turned to food security. Although this is a critical issue to address, it is important to remember that food security is primarily threatened by climate change as well as deforestation and unsustainable production and consumption of biofuels, which are touted by some countries as the solution to decarbonizing shipping.

More work must be done before next spring, when the measures must be formally approved. It is in Denmark's interest as a major maritime nation as well as a country with high potential in green energy and e-fuel production to strive for a global agreement that will not only benefit its economy, but also its ailing marine environment.

By |2024-12-10T11:32:12+01:0016 November 2024|Comment|Comments closed to IMO closer to agreement on CO2 regulation, but obstacles remain
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