Denmark’s journey as a green growth leader

Denmark is often highlighted as one of the leading examples of how to transition to a green and sustainable economy. Since 1980, Denmark has grown to become a global leader in the development of new sustainable technologies and solutions. During the same period, the Danish economy has grown by almost 80 per cent without increasing gross energy consumption.

This has not happened overnight as it has involved changing the energy system as a whole, promoting efficient use of resources for both industry and private households and developing regulation to support the transition.

1973 oil crisis as a catalyst

But Denmark did not start out with the vision to become a green growth champion. Because the journey started well before the global community started discussing global warming and climate change as one of the main issues. In 1973 an oil crisis hit the world when the Arab members of OPEC (Organization of the Petroleum Exporting Countries) plus Egypt and Syria declared an oil embargo which significantly increased oil prices. At the time 90% of Denmark’s energy consumption was covered by oil. This led to restrictions on energy use for households (lighting and heat) and e.g. car-free Sundays where it was forbidden to use cars. The Danish economy was hit hard and unemployment rose. It became clear that importing almost all of the country’s energy in the form of one commodity was too vulnerable and risky for the Danish economy.

So where would Denmark get it’s energy from? Nuclear was immensely unpopular with the Danes and was eventually scrapped as a national energy source so a two-pronged strategy was initiated; 1) it was decided to search for and develop oil fields in the North Sea, and 2) it was decided to fund research and support new renewable sources of energy (e.g. wind, solar, biomass etc.). This development has had a great impact on the national energy system as Denmark is a net oil exporter and has the highest penetration of renewable energy sources globally.

The world’s highest penetration of renewable energy

Denmark is home to some of the worlds leading technology companies within environment and renewable energy sectors. Vestas (the worlds largest wind energy company), Danfoss (valves and pump), Haldor Topsoe (catalytic processes) and many more. More than 1500 companies have “green” products or services accounting for a major line of business (Oxford Research).

Apart from renewable energy the area of energy efficiency has been tremendously important for Denmark to become a green economy. A combination of high energy prices and a focus on resource efficiency has made Danish industries competitive on the global market as companies are not as vulnerable to fluctuating energy prices as in many other countries.

Fossil free by 2050

Denmark has the ambitious goal of becoming the world’s first fossil fuel free country by 2050. The ambitious goal will be reached by the following actions:

  1. increasing energy efficiency and resource optimisation,
  2. expanding the share of renewable energy from sources such as wind and biomass
  3. driving the development of an intelligent energy system capable of managing the fluctuations of decentralised renewable energy generation.