Towards net zero emissions in Denmark
Denmark has been a frontrunner in policies that reduce greenhouse gas emissions and
now plans to cut emissions by 70% by 2030 from 1990 levels and to achieve carbon neutrality
by 2050. Such ambition induces halving emissions from 2019 levels and making the same
emission abatement effort in ten years than the past thirty years. Cutting emissions
at such fast pace will be challenging with substantial disruptions and macroeconomic
consequences. A balanced mix of pricing policies, public investment, regulation and
enabling policies should allow smoothing the potential economic and social shocks
and accompanying the reallocation of resources.
This paper investigates further sectoral climate strategies in Denmark. In the energy
sector (electricity and district heating), past progress made to ramp up clean technologies
provides a good blueprint to achieve further decarbonisation, but the focus will need
to be put soon on lowering reliance on woody biomass. In the transport sector, emissions
have continued to increase despite the shift to more fuel-efficient vehicles, highlighting
the need for more transformative policies to expand alternatives to individual car
uses. In agriculture, little has been done so far to cut emissions, especially from
livestock. The sector is subject to leakage risks, but nonetheless should be encouraged
to transform its practices. Helping farmers to monitor their GHG emissions should
be combined with more stringent regulation.
Published on April 04, 2022
In series:OECD Economics Department Working Papersview more titles