| Contents |

Denmark's Third National Communication on Climate Change

Under the United Nations Framework Convention on Climate Change

Contents

Foreword

The ultimate objective of international climate cooperation is described in Article 2 of the UN Framework Convention on Climate Change, namely to achieve a "stabilization of greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system".

In September 2001, the UN Intergovernmental Panel on Climate Change (IPCC) presented its Third Assessment Report. The report shows that there is now stronger evidence for a human influence on the global climate than previously assumed, and that most of the observed warming at the Earth’s surface over the last 50 years is likely to have been due to human activities. The climate changed during the twentieth century, and larger changes are expected in the twenty-first century.

No one knows the exact scope of future climate change. However, today no one can doubt the risk that climate change will affect humans and the environment in both the rich and the poor parts of the world. Taking climate change seriously has become a prerequisite for achieving sustainable development.

The Danish government takes global climate change seriously, and it will fully meet Denmark’s international commitments.

Within the framework of the Kyoto Protocol, under the auspices of the EU, Denmark is committed to reducing its emissions of greenhouse gases by 21% in 2008-12 compared to the level in 1990, taking into account the unusually high import of electricity in 1990. This is one of the hardest reduction targets in the world.

Since Denmark issued its First (1994) and Second (1997) National Communication under the UN Climate Convention, the Kyoto Protocol has been adopted, and the Conference of the Parties has taken the decisions necessary on realisation of the Protocol. Denmark ratified the Kyoto Protocol together with the other EU countries on 31 May 2002. The Danish government hopes that the Protocol will enter into force in 2003.

This Third National Communication is the result of extensive work, coordinated by the Danish Environmental Protection Agency, and with the participation of a large number of public institutions. The report contains information on implementation by Denmark, Greenland, and the Faeroe Islands of the commitments under the UN Convention on Climate Change, including emissions and uptake of greenhouse gases, policies and measures, and the expected effects of these.

The report also contains information on the Danish government’s new national climate change strategy, which the Danish Parliament, Folketinget, endorsed in March 2003. The strategy’s objective is to meet Denmark’s Kyoto target by achieving more environment for the money. The strategy therefore combines cost-effective national measures with use of the Kyoto Protocol’s flexible mechanisms and the EU system for trading with emissions.

Throughout the 90s, Denmark initiated considerable national efforts within the climate area, and these efforts will continuously contribute to reductions in the future. With regard to total emissions of all greenhouse gases, in 2000 Denmark achieved the target in the Convention on Climate Change to reduce to 1990 levels. Despite significant economic growth, CO₂ emissions have returned to the level in 1990. While electricity export to Scandinavia has increased, CO₂ emissions caused by domestic activities have decreased by more than 13%.

One of the most recent measures introduced is a tax on industrial greenhouse gases (HFCs, PFCs, and SF₆), which entered into force in March 2001. In July 2002 this was followed by rules on phasing out the use of these substances. With some exceptions, phase out will take place over the period 2003-2006.

The climate challenge requires targeted, long-term, and united action in accordance with the principle of common but differentiated responsibilities for countries. The industrialised countries must continue to lead the way with reductions in emissions of greenhouse gases, and grant assistance to the developing countries, including transfers of technology and capacity building. However, economic developments in several countries not listed in Annex I of the Convention on Climate Change are now so favourable that they will soon also be able to make greater contributions to curbing the increasing emissions of greenhouse gases. Not at the expense of their economic development, but to the advantage of it. Today there are many technological opportunities to promote economic development, and at the same time reduce emissions of greenhouse gases. Renewable energy is a good example.

We must initiate a process as soon as possible that builds upon openness and credibility between the Parties, and that aims at further action after 2012 -with a view to meeting our common goal, the ultimate objective of the Convention on Climate Change.

Copenhagen, May 2003

Hans Chr. Schmidt
Minister for the Environment

Introduction

At the United Nations Conference on Environment and Development in Rio de Janeiro in June 1992, more than 150 countries signed the UN Framework Convention on Climate Change (the Climate Convention).

On 21 December 1993 the Climate Convention was ratified by enough countries, including Denmark, for it to enter into force on 21 March 1994.

According to decisions made in pursuance of Article 12 of the Climate Convention information by the Par-ties, the Convention’s industrialised countries must sumit a Third National Communication to the Convention secretariat.

In accordance with guidelines under the Climate Convention, this Third National Communication contains a summary (Chapter 1), information on the national circumstances relevant to greenhouse gas emmissions and removals (Chapter 2), green-house gas inventory information (Chapter 3), policies and measures affecting greenhouse gas emissions and removals (Chapter 4), projec-tions and the total effect of policies and measures (Chapter 5), vulnera-bility assessment, climate change impacts and adaptation measures (Chapter 6), financial ressources and transfer of technology (Chapter 7), research and systematic observations (Chapter 8), and education, training and public awareness (Chapter 9).

This report thus contains information about Denmark’s implementation of the obligations under the Climate Convention.

Denmark also contributes to the European Union’s implementation of the Climate Convention’s obligations, including in connection with inventories of the EU greenhouse gas inventory and in connection with the implementation of common and coordinated policies and measures to reduce greenhouse gas emissions, including under the European Climate Change Programme (ECCP).

Further information on the EU’s climate policy etc. is to be found in the EU’s Third National Communication.

Since Denmark’s ratification of the Climate Convention covers the entire Kingdom, this communication also contains information on Greenland and the Faroe Islands. Unlike Denmark’s Second National Communication from 1997, it is now possible to show preliminary inventories of Greenland’s and the Faroe Islands’ greenhouse gas emissions, because such inventories are now included in the annual emission reports to the Climate Convention.

With respect to Denmark’s inventories and projections of emissions and removals of greenhouse gases it should be noted that these are shown both in the form that must be used under the Climate Convention and in the form expected to be used under the Kyoto Protocol. Summary inventory information for the economic sectors in Denmark is also shown. Further information and more detailed data combinations are available on the Danish Environmental Protection Agency’s website (www.mst.dk).

The Kyoto Protocol was adopted by the Parties to the Convention in November 1997, and after the agreement on the EU Member States’dis-tribution of the burden of the EU’s total obligation under the Kyoto Pro-tocol, Denmark and the other EU Member States ratified the Protocol in May 2002. Territorial reservation was taken for the Faroe Islands in connection with Denmark’s ratification of the Protocol. It should be noted that only Denmark’s greenhouse gas emissions are included in the EU’s distribution of the burden under Article 4 of the Protocol because Greenland and the Faroe Islands are not members of the EU.

Besides the Danish Environmental Protection Agency (DEPA), which is in charge of the work, the following institutions have contributed to this Third National Communication:

1 Executive Summary

1.1 National circumstances relevant to greenhouse gas emissions and removals

1.1.1 General

The Kingdom of Denmark comprises Denmark, Greenland and the Faroe Islands. The UN Framework Convention on Climate Changes has been ratified on behalf of all three parts of the Kingdom.

Today, Denmark has a population of slightly more than 5.3 million and a total area of 43,000 km². More than 60% of the area is used for agricultural purposes, while 11% is forested and 13% is towns, roads and scattered housing, while the rest consists of natural areas, including lakes, bogs, heath, etc.

The Danish climate is temperate with precipitation evenly distributed over the year. The mean annual temperature is 7.7ºC and mean annual precipitation is 712 mm.

Since 1993 Denmark has benefitted from considerable economic growth, and Gross National Product (GNP) has risen on average by 2.7% per year. In the year 2000 GNP amounted to over DKK 1,300 billion, corresponding to DKK 245,000 per capita.

1.1.2 Energy, transport and the domestic sector

Denmark is self-sufficient in energy, due primarily to the production of oil and gas in the North Sea, but renewable energy is also increasingly contributing to the country’s energy supply. Denmark’s total own production of energy has more than tripled during the last decade.

Despite strong economic growth, energy consumption has remained largely unchanged at around 800 PJ in the period in question.

Denmark’s dependence on oil and coal has fallen, and particularly within electricity and heat production, Denmark has succeeded in substituting with other fuels. Renewable energy accounts for about 12% of Denmark’s actual energy consumption. Actual energy consumption, which amounted to 829 PJ in 2001, was distributed over the following energy sources: oil 366 PJ (44%), natural gas 194 PJ (23%), coal 175 PJ (21%) and renewable energy 96PJ (12%). The net export of electricity was relatively small, corresponding to 2 PJ.

The distribution of gross energy consumption in 2001 was as follows: industry and agriculture accounted for 27%, domestic sector for 27%, transport for 24% and commerce and service for 15%. Refining and non-energy purposes accounted for the remaining 7%.

More than 2/3 of the electricity supply comes from large primary power stations or CHP plants, while the district heat supply covers almost half of the need for heating. The energy sector alone (energy production and supply) accounts for 40% of Denmark’s total emissions of greenhouse gases.

Traffic has increased considerably in the last 10 years. Passenger traffic (excl. motor cycle, 2-stroke and bicycle traffic) increased from 64 billion person-kilometres in 1990 to 74 billion in 2001. In the same period, freight transport by road increased from 12 billion tonne-km to14 billion. The transport sector accounts for 18% of Denmark’s total greenhouse gas emissions.

The domestic sector accounted for about 6% of Denmark’s total emissions of greenhouse gases in 2001.

1.1.3 Business sector and waste

Industry’s production value accounts for about 30% of total production. The largest sectors of industry are food and beverages, engineering, electronics and the chemical industry. The total business sector (industry, building and construction, together with public and private services) accounts for about 13% of Denmark’s total emissions of greenhouse gases. By far the largest part of these emissions, is CO₂ from energy consumption, but the sector is also a source of emissions of industrial greenhouse gases.

The waste sector’s methane emissions account for 2% of the total greenhouse gas emissions. Methane emissions from the waste sector are expected to fall in the future due to the obligation the municipalities have had since 1997 to send combustible waste for incineration. In addition, gas from a number of landfill sites is used in energy production, which helps to reduce both CO₂ and methane emissions.

1.1.4 Agriculture and forestry

In the last 40 years the agricultural area in Denmark has fallen from 72% (30,900 km²) of the total area in 1960 to 62% (26,756 km²) in 2001. The number of farms has fallen by 50%, from 119,155 in 1980 to 53,489 in 2001, while the average size of farms has increased by more than 100% in the same period, from 24 ha to 50 ha. At approximately 11%, agricultural exports will account for a considerable proportion of all Danish exports. The agricultural sector accounted for about 20% of Denmark’s total emissions of greenhouse gases in 2001.

Approximately 11% of Denmark is forested, and the Forestry Act protects a very large part of the existing forest from other land use. The ambition is to have about 20-25% of Denmark’s area forested by the end of the 21st century.

1.1.5 Greenland and the Faroe Islands

Greenland is the world’s largest island, with an area of 2.2 million km², 85% of which is covered by the ice cap. From north to south, Greenland extends over 2,600 km. Greenland has a population of slightly more than 56,000, and fishing is the main occupation.

Greenland’s climate is Arctic, and forests do not grow in Greenland. The warmest recorded temperature since 1958 is 25.5ºC, while temperatures can go down below –70 ºC on the inland ice.

The Faroe Islands consist of 18 islands with a total area of 1,399 km² and have a population of around 47,000. The climate is characterised by mild winters and cool summers and the weather is often moist and rainy. The mean annual temperature is 6.5 ºC.

Fish and fisheries account for 98% of the Faroe Island’s total export earnings, apart from exports of ships, which vary greatly over the years. Agriculture was the main occupation until the end of the 19th century but now only accounts for 0.7% of gross national product at factor cost. There are more than 1,000 head of cattle and about 70,000 sheep on the Faroe Islands.

Table 1.1
Denmark’s total emissions and removals of greenhouse gases 1990-2001

Look here!

1.2 Greenhouse gas inventory information

Denmark’s greenhouse gas inventories are prepared in accordance with the guidelines from the Intergovernmental Panel on Climate Change (IPCC) and are based on the methods developed under the European CORINAIR programme. Table 1.1 shows Denmark’s total emissions of the greenhouse gases CO₂, CH₄ and N₂O and the industrial gases HFCs, PFCs and SF₆ from 1990 to 2001, calculated in CO₂ equivalents in accordance with the general rules for inventories under the Climate Convention. Inventory based on the rules under the Kyoto Protocol will involve some changes with respect to base year and removals in connection with land use change and forestry (LUCF). As will be seen from this table, the total emissions in 2000 and 2001 were slightly below the total emissions in 1990. The main reasons for this are explained under the individual greenhouse gases and sectors.

1.2.1 Carbon dioxide, CO₂

Almost all CO₂ emissions come from combustion of coal, oil and natural gas at power stations and in residential properties and industry, although road transport also contributes a considerable proportion – about 20%. The relatively large fluctuations in the emissions from year to year are due to trade in electricity with other countries – primarily the Nordic countries.

The reduction in CO₂ emissions in recent years is due mainly to the fact that many power stations have changed their fuel mix from coal to natural gas and renewable energy. As a result of the reduced use of coal in recent years, most of the CO₂ emissions now come from combustion of oil.

Table 1.2
Denmark’s, Greenland’s and the Faroe Islands’ total emissions and removals of greenhouse gases, 1990 – 2001

Look here!

1.2.2 Methane, CH₄

The biggest source of man-made methane emissions is agriculture, followed by landfill sites and energy production. The emissions from agriculture are due to the formation of methane in the digestive system of farm animals and the handling of manure. The emissions from agriculture and landfill sites have both fallen by 10-11% since 1990 – in the first case because of a change in farm animal population, with a reduction in the cattle population and an increase in the pig population, and in the second because of increased collection and use of landfill gas in the period in question.

The emissions from energy production are rising because of increasing use of gas engines, which have large methane emissions compared with other combustion technologies.

1.2.3 Nitrous oxide, N₂O

Agriculture is by far the main source of emissions of nitrous oxide because this forms in soil through bacterial conversion of nitrogen in fertiliser and manure. Bacterial conversion of nitrogen also occurs in drain water and coastal water. It will be seen that there has been a considerable fall in nitrous oxide emissions from agriculture since 1990. That is due to less and better use of fertiliser. A small proportion of the nitrous oxide emissions comes from the exhaust of cars fitted with a catalytic converter.

1.2.4 The industrial gases HFCs, PFCs and SF₆

The contribution of industrial greenhouse gases (HFCs, PFCs and SF₆) to Denmark’s total emissions of greenhouse gases is relatively modest, but in percentage terms, the emissions of these gases showed the biggest rise during the 1990s. The HFCs, which are primarily used in the refrigeration industry, are the biggest contributor to industrial greenhouse gas emissions. In 2001 industrial gases accounted for about 1% of total emissions of greenhouse gases, corresponding to approximately 700,000 tonnes of CO₂ equivalents. However, in 2001 and 2002 new regulatory instruments, including both taxes and bans, were adopted.

1.2.5 Denmark’s, Greenland’s and the Faroe Islands’ total emissions and removals of greenhouse gases

The total inventories for Denmark, Greenland and the Faroe Islands are reproduced in table 1.2. As will be seen the Climate Convention’s goal of reduction of the emissions to the 1990 level in 2000 was achieved. The combined level for Denmark, Greenland and the Faroe Islands in 2000 was 1.1% below the 1990 level.

For the time being, the inventories from Greenland contain only inventories of the CO₂ emissions from combustion of fossil fuels. However, this is regarded as by far the main source of greenhouse gases.

The inventories for the Faroe Islands contain not only the CO₂ emissions from fossil fuel but also the methane and nitrous oxide emissions.

In accordance with the rules of the Kyoto Protocol, Denmark has chosen 1995 as the base year for industrial greenhouse gases and, in the calculation under the Protocol has – for the time being – included only the removals in forests occurring as a consequence of afforestation since 1990. Denmark’s reduction obligation of 21% in 2008-2012 in relation to the base year (1990/95), is related to the EU’s total reduction obligation through the so-called burden-sharing agreement. The Faroe Islands are not covered by the Kyoto Protocol because of a territorial reservation taken at the time of the Kingdom of Denmark’s ratification of the Protocol.

The preliminary inventories form the basis for Denmark’s climate strategy described in chapter 4.

1.3 Policies and measures

Since the end of the 1980s and up through the 1990s a number of initiatives have been taken to reduce emissions of greenhouse gases. The initiatives have produced important results – particularly with respect to CO₂ – and will also result in further reduction of greenhouse gas emissions in the future.

The initiatives have been, and still are, targeted mainly on the sectors of society in which the activities result in considerable emissions of greenhouse gases and have had the purpose of broad environmental improvements in Denmark.

In February 2003 the government published Denmark’s new climate strategy. Cost effectiveness is a vital planning consideration in order to gets more environment for the money. The basis of the strategy is that Denmark must fulfil its international climate obligations under the Kyoto Protocol and according to the subsequent burden – sharing agreement in the EU.

On the basis of the latest projection of Denmark’s emissions of greenhouse gases, it is now estimated that, without new initiatives, there will be a shortfall of 20-25 million tonnes of CO₂ equivalents per year in the period 2008-12. The Kyoto Protocol makes it possible to plan climate action that is more flexible and that, globally, gives more environment for the money. The climate strategy combines cost-effective domestic measures with use of the Kyoto Protocol’s flexible mechanisms.

For many of the energy producers and a large part of the energy-intensive industry, the coming EU Directive on a Community scheme for trading with greenhouse gas emissions will form the framework for the coming action. The companies that are covered by the scheme, and whose activity will thus be limited by a quota, will be able to plan their climate action themselves. They can choose to reduce their own emissions, when it is most appropriate or buy quotas or credits from projectbased emission reductions, when it is deemed most suitable. The companies covered by the scheme will thus have the possibility of ongoing adjustment of their action so that it is always as effective as possible.

Besides quotas and the use of flexible mechanisms, the climate strategy includes a number of national measures, including existing measures that are being continued and new, potential measures that will be considered on the way.

Since the reduction costs in the different sectors are continuously changing, in part due to technology development and changed economic framework conditions, the strategy includes regular evaluation of the action so that the most cost-effective policies and measures are chosen.

In connection with the climate strategy it is estimated that the international price level for quotas/credits is hardly likely to exceed DDK 100 per tonne CO₂ equivalent, with a price level of DKK 40-60 as the most probable.With this price level, it will be considerably cheaper to buy international quotas/credits than to implement most of the national reduction measures.

In a comparison with the national mechanisms it is important to be aware that these must typically be seen in a sector-political context, in which climate is only one among many considerations in the policy being planned. For example, a fundamental consideration in the energy sector is security of supply, which, all else being equal, is improved by lower energy consumption and a multiple energy supply.

An interministerial committee will regularly evaluate the cost effectiveness of the national measures, including new policies and measures. The government has set an economic benchmark of DKK 120/tonne CO₂ equivalent to be used as a basis for implementing national policies and measures outside the area covered by the EU trading scheme. The latest calculations indicate that only relatively few national policies and measures with a significant potential that do not exceed DKK 120/tonne CO₂ equivalent would be able to compete with the price of using the flexible mechanisms. This must also be seen in the light of the fact that Denmark has already done a great deal nationally up through the 1990s, while there is a large, unexploited potential in other countries.

For the national measures, where the analyses show relatively low reduction costs, all in all the potential is not sufficient to remove the Danish shortfall. On the other hand, there is considered to be sufficient potential to buy quotas and credits internationally.

The energy sector

The energy sector is at the centre of the efforts to reduce the emissions of CO₂. Many initiatives have been taken over a long period of years to reduce the emissions, and work is still going on to find the best and most cost-effective initiatives.

Some measures can bring general pressure to bear on players in the energy sector to reduce their CO₂ emissions. Denmark’s Quota Act, which regulates the emissions of CO₂ from the open, market-regulated production of electricity, is an example.

Taxes have also been used for a number of years as measures to reduce the CO₂ emissions from the energy sector – partly with a view to a general reduction and partly to promote the use of fuels with lower CO₂ emissions, mainly biomass. Such taxes are still used.

Increased use of CHP and enlarging the areas receiving district heat have been main elements of the Danish strategy to promote efficient use of energy resources ever since the end of the 1970s.

Renewable energy sources are promoted with economic measures, including the tax system and through direct production grants.

It is estimated that expected rising electricity exports would result in a considerable increase in emissions unless measures were taken to prevent this. However, electricity production is covered by the proposal for an EU Directive on a scheme for emissions trading, and Denmark’s climate strategy is thus based on the assumption that electricity production will be covered by the EU’s quota scheme from 2005.

The transport sector

Efforts to turn the upward trend in emissions of greenhouse gases in the transport sector have so far failed, in part because it is extremely difficult to reduce the CO₂ emissions in this sector in Denmark, which is not a carmaking country, without international initiatives.

The transport sector’s possibility, with national measures, of contributing to reduction of Denmark’s CO₂ emissions shows that the cost-effectiveness of the measures depends entirely on the side effects. The decision to implement the different measures within the transport sector must therefore to a great extent be evaluated on the basis of the measure’s other effects and not simply from the point of view of reduction of CO₂ emissions.

The business sector

The ongoing initiatives to reduce the emissions from the business sector include both promotion of energy savings and energy efficiency improvements, conversion of energy production to cleaner fuels and initiatives to reduce the emissions of industrial gases.

Work to improve energy efficiency in the public sector has been going on for more than 10 years, and considerable savings have been achieved. However, there are still economically viable possibilities for savings. In continuation of the provisions in the Act on Promotion of Savings in Energy Consumption from 2000 and several energy policy agreements, plans are in hand to tighten the action, especially in the public sector.

The regulation of emissions of the industrial greenhouse gases (HFCs, PFCs and SF₆) is 2-phased, consisting partly in a tax and partly in a statutory order on discontinuation of the use of the gases in new installations. The tax is imposed on the substances on importation because none of them is produced in Denmark.

In July 2002 a statutory order on regulation of the industrial greenhouse gases went into force. It includes a general ban on use of the industrial greenhouse gases in a wide range of new installations/products from 1 January 2006, including, for example, domestic refrigerators and freezers, PUR foam, etc.

Agriculture, forestry and fisheries

Within the agricultural sector the following measures have reduced or will reduce emissions: i) ban on burning of straw on fields, ii) the biomass agreement on use of straw for fuel, iii) Action Plans for the Aquatic Environment I and II and Action Plan for Sustainable Agriculture, and iv) the Ammonia Action Plan.

The Action Plans for the Aquatic Environment and the Action Plan for Sustainable Agriculture have, in particular, reduced the emissions of nitrous oxide, and most of the changes in emissions of nitrous oxide from the agriculture sector that have taken place since 1990 can be attributed to these action plans.

2001 brought the adoption of an Ammonia Action Plan, which together with Action Plans for the Aquatic Environment I and II, will reduce ammonia evaporation.

The purpose of banning burning of straw has been to reduce air pollution from this activity. The ban has resulted in greater return of carbon to the soil and increased use of straw as a fuel.

The purpose of the biomass agreement is to increase use of biomass for energy purposes through the establishment or conversion of power stations and CHP plants for use of this fuel. Straw as a fuel substitutes fossil fuels.

The national forest programme includes evaluation of the possibilities offered by the Kyoto Protocol for economically viable CO₂ sequestation sequestation in forests. The political goal with the most direct influence on increased carbon sequestation is the declaration of intent from 1989 to double the forested area in Denmark within 100 years.Various measures have been taken towards achieving this goal. For instance, a government grant scheme has been establish that supports private afforestation on agricultural land and the state itself establishes new forests. In addition, some private individuals choose to establish forests on agricultural land without a government grant.

The domestic sector

With a view to reducing both direct and indirect CO₂ emissions from the domestic sector, a wide range of initiatives have been launched. The initiatives promote i) electricity savings, ii) savings in energy consumption for space heating and iii) fuel conversion (from electric heat and oil to district heat, natural gas and renewable energy).

Following up on the climate strategy new energy-saving initiatives are expected, including of standards for products’ energy efficiency.

The waste sector

The waste sector’s contribution to reduction of greenhouse gas emissions consists mainly in: i) reducing landfilling of organic waste, ii) utilising gas from discontinued/existing landfill sites and iii) using the waste as an energy source.

In 1996 the statutory order on waste was amended to introduce a municipal obligation to assign combustible waste to incineration (corresponding to a ban on deposition of combustible waste). As a result of this, large quantities of combustible waste that used to go to landfill sites are now either recycled or used as fuel in Denmark’s incineration plants. Future action will consist mainly in a continued ban on landfilling of combustible waste and implementation of Waste 21.

Table 1.3
Denmark’s Expected Emissions Of Greenhouse Gases

*Note: The base year data and shortfall calculation used in connection with the climate strategy are shown in brackets.

1.4 Projections and the total effect of policies and measures

The latest projections from February 2003 cover the period 2001-2017. The calculations for the period 2013-2017, however, must be described as somewhat less certain that the projections up to 2013 because the uncertainty concerning the policies and measures and their expected effect increases with time. In the climate strategy from February 2003, the inventories of how much Denmark is expected to lack in order to meet the obligations entered into on the basis of the existing mechanisms, policies and measures have been calculated both taking account of electricity import in 1990 and not taking account of this.

According to the latest inventories of greenhouse gas emissions, Denmark’s legal reduction obligation of 21% means that the emissions must be reduced from 69.5 million tonnes CO₂ equivalents in the base year 1990, to 54.9 million CO₂ equivalents in the period 2008-2012, as shown in table 1.3.

It should be noted that the latest historical inventory of greenhouse gas emissions covers the period 1990-2001, so the projection for 2001 in this report has been replaced with the historical inventory for 2001. Since this new inventory also includes an update of the 1990 figures as a consequence of new knowledge, the base year – and thus also the shortfall – has been changed slightly in relation to the inventory in the climate strategy.

Denmark’s expected annual emissions in the period 2008-2012 have been calculated at 80.1 million tonnes CO₂ equivalents. However, the size of the total greenhouse gas emissions depends greatly on CO₂ emissions related to electricity exports, which are expected to account for 9.9 million tonnes CO₂ equivalents per year in 2008 - 2012.

1.5 Vulnerability assessment, climate change impacts and adaptation

Analyses with global and regional climate models show the following general trend for the climate in Denmark in 2100 in relation to 1990:

The analyses do not directly give scenarios for future changes in water level, but earlier studies show slightly smaller rises around Denmark than the global rises because of vertical land movements. For example, it is estimated that an average global rise in water level of 0.5 m will lead to a rise of about 0.4 m around Denmark.

The general conclusion has been that the direct impacts in moderate climate scenarios will be moderate for Denmark and can be countered by suitable, ongoing adaptation. Danish studies of – and preparation for – impacts of climate changes have so far been very modest, and there are as yet no actual action plans.

For Danish agriculture, the overall effects are estimated to be advantageous. Changes in cultivation practice can be implemented at short notice, and production is expected to grow with rising temperature and CO₂ concentration.

Danish field and greenhouse studies have shown that climate change will generally promote tree growth, particularly for the species with the northern limit of their spread in Southern Scandinavia. The only species of tree that will show decline is the Norway spruce.

About 1,800 km of the 7,400 km coastline are protected with dikes or other permanent installations, and increasing use is being made of soft solutions, particularly beach feeding.

Analyses with global climate models show the following general trend for the climate in Greenland in 2100 in relation to 1990:

Analyses with global climate models show the following general trend for the climate on the Faroe Islands in 2100 in relation to 1990:

1.6 Financial resources and transfer of technology

The Danish development cooperation is financed mainly by a facility for assistance to developing countries (DKK 10.5 billion in 2002), the main purpose of which is to promote sustainable development through poverty-oriented growth. Denmark has been in the lead with respect to making funds available for environmental action in the developing countries and the countries of Central and Eastern Europe, partly in the facility for assistance under the Developing Countries Facility and partly through the establishment of the Environment, Peace and Stability Facility (MIFRESTA) as an element of Denmark’s follow-up on the Rio Conference in 1992. Overall, Denmark will continue to provide extensive support for the benefit of the environment in the developing countries, since it is estimated that more than 15% of the facility for assistance to developing countries is used for environmental assistance.

1.7 Research and systematic observations

Research and observations within climate in the broad sense of the word are going on at a number of institutes and organisations and cover a wide range of disciplines, from natural science to evaluation of policies and measures and societal aspects.

Denmark’s Meteorological Institute (DMI) carries out observations of climate parameters (atmosphere and ocean), including observations under the World Meteorological Organisation (WMO)’s programmes and subprogrammes. Climate observations, together with climate research, have been one of DMI’s main tasks for more than 125 years, with measurement, theory and modelling.

The Danish research competence concerning physical expressions of past climate change is to be found at Geological Survey of Denmark and Greenland (GEUS), which also has competencies in glaciological studies of Greenland’s ice cap and its interaction with climate change, and the importance of climate change for water’s cycle in nature. Besides research in the climate system, the climate-related research includes research concerning the driving forces for emissions of greenhouse gases and their burden on the environment, the state of the environment – physical, chemical and biological, effects and climate changes and society’s possibilities for response and regulation.

The National Environmental Research Institute, the Danish Forest and Landscape Research Institute, the Danish Institute of Agricultural Sciences and Risø National Laboratory are all involved in these climaterelated research areas. In addition, several of the country’s universities also work with different aspects of climate research.

It is partly only the basis of research competencies in the above-mentioned areas that Denmark also participates actively in IPCC’s work. In addition, the Danish climate research contributes to a wide range of international projects under the World Climate Research Programme. Danish climate research increased steadily in the period 1998 to 2001, from 172 man-years in 1998 to 189 man-years in 2001. The budget increased correspondingly from DKK 94 million in 1998 to DKK 114 million in 2001. Of this, foreign funding accounted for just under 30%.

Since the establishment of DMI in 1872 the institute has monitored the main climate parameters. In the climate monitoring programme, classic methods of measurement are used and new, satellite-based observation methods are developed.

DMI operates around 200 automatic measuring stations in the Kingdom (Denmark, Greenland and the Faroe Islands) with a broad measuring programme ranging from automatic water level or precipitation stations that measure only one parameter to stations with a full measuring programme, including automatic cloud height detectors and weather type detectors. For collection of precipitation data DMI also operates a network of 500 manual precipitation stations, which are used mainly for mapping the precipitation climatology.

Besides being of use for national programmes, the observations concern Denmark’s international contribution in the form of observation components from Danish territory to the worldwide meteorological observation network WWW (World Weather Watch), GCOS (Global Climate Observing System) and other international programmes for mapping weather and climate.

The meteorological observations are stored in DMI’s database, and observations from many Danish stations are available in electronic form right back to 1872, water level measurements back to 1890, and measurements of the surface temperature of the sea back to 1931. In 2001, 75,000 observations were added to the database each day, and the total number of observations in the database is around 245,000,000.

1.8 Education, training and public awareness

In Denmark there is an ongoing public debate in the media and elsewhere about the manmade greenhouse effect and its political reaction in the form of policies and measures. Denmark has a long tradition for involving the public and, in the environment field, this tradition was followed up by an international agreement – the Århus Convention from 1998. A considerable amount of information on climate change and Danish policies is provided on the websites of the Ministry of Environment (www.mim.dk), the Danish Environmental Protection Agency (www.mst.dk), the Ministry of Finance (www.fm.dk), the Ministry of Economic and Business Affairs (www.oem.dk) and the Danish Energy Authority (www.ens.dk).

NERI has prepared a range of climate reports, which, together with other climate information, e.g. climate data, are published on NERI’s website www.dmu.dk. DMI has a climate website at www.dmi.dk, providing current and historical climate data, together with a basic description of the climate system and climate processes, and themes on new results from the international scientific literature.

DMI participates in a number of international projects, with support primarily from the EU Commission’s framework research programmes, which involve exchange of knowledge and post-graduate training of Danish research scientists. In addition, addition, the Institute contributes to IPCC’s work, and the results from that, which are communicated to the public.

A number of initiatives are being carried out to promote environmentally sound behaviour in companies and households, particularly for climate reasons, and with respect to energy use. Labelling schemes, printed matter, information lines, media spots and similar are used to increase public knowledge of possibilities for action and knowledge of less environmentally harmful technologies.

2 National circumstances relevant to greenhouse gas emissions and removals

The Kingdom of Denmark comprises Denmark, Greenland, and the Faroe Islands. The UN Framework Convention on Climate Change has been ratified on behalf of all three parts of the Kingdom, and this report therefore contains information on all three. However, at the present time, more information is available on Denmark than on the other parts of the Kingdom. Where tables, figures, and other information in this report also cover Greenland and/or the Faroe Islands, this is stated.

2.1. Denmark

Denmark is a constitutional monarchy, and the power of the state is divided between the legislative branch, the executive branch, and the judicial branch. According to the Kingdom’s Constitution, legislative power lies with the Folketing (the Danish Parliament), which consists of 179 members, two of whom are elected on the Faroe Islands and two in Greenland. The members are elected by the population for a period of normally four years.

The executive branch – the government – cannot have a majority of the Folketing against it, and the government is often a majority government. The number of ministers in the government varies. Since 1973 Denmark has had a Minister for the Environment and a Ministry of the Environment. They conduct the international negotiations in the climate area on behalf of Denmark and also have the primary responsibility for coordination of legislation, plans, etc. with respect to climate.

For the last ten years or so, other ministries have also worked with environmental and climate issues. In 1988 the government decided to follow up on the UN report on sustainable development – the Brundtland Report in which one of the main messages of which was the necessity of integrating the environmental issue into the administration within such sectors as transport, agriculture and energy.

For this reason, a number of sector ministries have drawn up action plans in which the environment is an integral element. Examples are sector plans for energy, transport, agriculture, and development assistance. In the climate area, further to the previous government’s status report Climate 2012 from 2000, the government presented a overall status in connection with the presentation of its proposal for ratification of the Kyoto Protocol in April 2002. This status report was followed in February 2003 by a government proposal for a national climate strategy for Denmark, including analyses from the sector ministries, which was adopted by the Folketing on 13 March 2003.

One of the main cornerstones of Danish democracy is autonomous local government, and specific environmental action takes place not only at national level but also at county and municipal level. The state sets the national rules and framework for environmental administration, while the counties and municipalities, working within this framework, plan and decide initiatives that implement and support the national legislation.

The importance of local involvement is stressed in "Agenda 21 – a global agenda for sustainable development in the 21st century", which was adopted at the Rio Conference in 1992. The government supports the popular interest and participation in climate and environmental issues in different ways – including through implementation of the Pan-European Århus Convention and support for the local Agenda 21 work initiated by most of the Danish municipalities.

2.1.2 Population

Today, Denmark has a population of slightly more than 5.3 million. As will be seen from table 2.1, population growth has been relatively small in the last 20 years.

Table 2.1:
Population of Denmark

Source: Statistics Denmark

The latest forecasts show that population growth will continue to be moderate in the years ahead. For example, the population is expected to reach 5.5 million in 2010, rising to 5.7 million in 2020. The low birth rate in the 1980s means that young people between the ages of 15 and 24 years make up only 11% of the population, while the elderly, between 50 and 64 years of age, account for 19%.

Today, the population density is slightly more than 120 per km².

Two-thirds of Danish wage earners are employed in service trades, while 20% are employed in manufacturing.

2.1.3 Geography

Denmark consists of the Jutland peninsula and more than 400 islands. It has a total area of 43,075 km² and lies at about 55º N and 11º E.

The whole of the country is lowland. The surface was formed by Ice Age glaciers and glacial streams. The highest hill is approximately 170 metres above sea level.

The coastline has a length of more than 7,400 km. To protect low-lying land against flooding and storm surge, it has been necessary to build dikes or other permanent installations along about 1,800 km of coastline. In addition, sandbags, breakwaters and similar protect other parts of the coastline, which would otherwise erode because they consist of soft materials deposited during the last Ice Age.

A rise in the water level due to climate change would obviously affect the protection of the coasts and create a greater risk of flooding and erosion.

The Danish landscape is indelibly stamped by the high population density. More than 60% of the land is used for agriculture or horticulture. Woodlands take up 11%, while towns, roads and scattered habitation take up 13%. The rest is nature, for example, lakes, bogs, heaths, and dunes.

In relation to its size, Denmark is home to a wide variety of flora and fauna – in all, about 30,000 species.

2.1.4 Climate

Denmark has a temperate climate, with rainfall evenly distributed over the year. The country lies in the zone of prevailing westerly winds, which is characterised by fronts, low pressure, and changeable weather. Compared with other regions on the same latitude as Denmark, the climate is relatively warm due to the warm North Atlantic current that originates in the tropical sea off the east coast of the USA.

As mentioned, Denmark has a distinctly coastal climate, with mild, damp winters and cool, unsettled summers. Average temperatures vary from about half a degree in winter to about 15 degrees in summer. However, the weather in Denmark is greatly affected by the proximity of both the sea and the continent. This means that the weather can change, depending on the prevailing wind direction. The west wind from the sea brings relatively uniform weather in summer and winter: mild in winter and cool in summer. When the wind comes from south or east, the weather in Denmark is more similar to that of the continent: warm and sunny in summer and cold in winter. The weather in Denmark thus depends very much on the wind direction and the season.

Atmospheric pressure

Average atmospheric pressure in Denmark shows seasonal variation, reaching a minimum in November and a maximum in May.

Denmark’s highest-ever atmospheric pressure, 1062.5 hPA, was recorded in Skagen on 23 January 1907, while just one month later, on 20 February, the lowest atmospheric pressure in the history of Denmark was also recorded in Skagen, at 943.9 hPa.

Temperature

The annual mean temperature varies from year to year, from below 6ºC to more than 9ºC, with an average of 7.7ºC. The coldest year so far was 1879, with a mean temperature of 5.9ºC, while the hottest recorded year was 1990, with 9.3ºC. Since 1988, almost every year has been hotter than normal, and the temperature showed a sharply rising trend in the 1990s. Taken over the last 100 years, the temperature in Denmark has risen by about 0.5ºC, but the ten hottest years occurred from the 1930s to the 1990s.

Figure 2.1:
Annual mean temperature in Denmark 1873-2000 , corrected values in ºC
  

Figure 2.2:
Denmark’s annual precipitation 1874-2000
   

Figure 2.3:
Annual hours of sunshine in Denmark 1920-2000 in percent
  

Figure 2.4:
Annual mean cloud cover in Denmark 1874-2000 Source: Denmark’s Meteorological Institute

The temperature in January and February averages around 0ºC but can vary greatly from 12ºC to below -31ºC. The average temperature in July and August is around 15ºC, but again can vary from below -3ºC to more than 36ºC.

Precipitation

Average annual precipitation varies greatly from year to year and from place to place. The lowest annual precipitation for the country as a whole was 464 mm in 1947, and the highest was 905 mm in 1999, while the average annual precipitation is 712 mm.

The wettest months are normally September, October, and November, while the driest are February to May. In the winter months, the precipitation is sometimes in the form of snow. Annual precipitation in Denmark has on average increased by about 80 mm since 1940.

Hours of sunshine and cloud cover

On average, Denmark as a whole has about 1,701 hours of sunshine annually, but as in the case of the precipitation, this figure varies greatly from year to year. The sunniest year was 1947, with 2,022 hours, and the least sunny was 1954, with 1,437 hours.

December is the least sunny month, with less than 40 hours of sunshine in most places, while June is the sunniest, with an average of 250 hours. Average annual cloud cover is 67%. 146 days are cloudy, i.e. with cloud cover at >80% and only 31 days are clear, with cloud cover at <20%. Since 1980, the trend has been towards more hours of sunshine and less cloud cover.

Wind

Countrywide, annual mean wind velocity is 5.8 m/s, and the wind is most frequently from westerly directions, from which about 25% of all winds come.

The number of days with severe wind (>10.8 m/s) varies from about 30 in some places inland to almost 170 days at Skagen. On average, storm-force (> 24.5 m/s) occurs along the Danish coasts every three to four years. In December 1999 large parts of Denmark were hit by the worst-ever measured hurricane, and in some places mean wind velocities (average over 10 minutes) of more than 40 m/s were recorded, with gusts of up to 50 m/s.

2.1.5 Economy

Since 1993 Denmark has benefited from considerable economic growth, with GNP (Gross National Product) rising at an average of 2.7% per year. In 2000 GNP was more than DKK 1,300 billion, corresponding to DKK 245,000 per capita. (1 Euro equals approximately DKK 7.4).

In 2000 the public debt stood at 47% of GNP, compared with 78% in 1993. In the same period, foreign debt was reduced from 32% of GNP to 17%.

From table 2.2, which shows key figures for the Danish economy, it will be seen that Denmark has a very open – and thus sensitive economy, in which exports account for a substantial part of total demand. In addition, public expenditure accounts for a large part of GNP. Tabel 2.3 shows the business sector’s contribution to GNP

Table 2.2:
Key figures for the Danish economy. Current prices, year 2000, in DKK mill. Source: Statistics Denmark

2.1.6 Energy and the domestic sector

Energy production and energy-consuming activities are the main contributors to the emissions of greenhouse gases in Denmark. The energy sector on its own, i.e. energy production and supply, accounts for 40% of the total emissions of greenhouse gases, mainly CO₂, to which must be added the emissions from the energy-consuming activities in the transport sector, industry and households.

In the energy sector the economic trend, related to domestic energy consumption and the trend in CO₂ emissions have been decoupled, CO₂ emissions have been reduced despite strong economic growth.

Production and supply

Denmark is self-sufficient in energy, see table 2.4. This is mainly due to the production of oil and gas in the North Sea, but renewable energy is also increasingly contributing to the country’s energy supply. As will be seen from table 2.5, Denmark’s own production of energy has more than tripled in the last decade.

Table 2.3:
The business sector’s contribution to GNP. Current prices, year 2000, in DKK mill.

Source: Statistics Denmark

Today, more than 10% of the demand for energy is supplied by renewable energy. The renewable energy resources are mainly wind energy and biomass, which are used to produce electricity, combined heat and power, or district heating. Internationally, Denmark is among the leading nations in wind energy.

Table 2.4:
Degree of self-sufficiency in %

Source: Danish Energy Authority

Energy consumption

Despite the economic growth, total energy consumption has remained largely unchanged at approximately 800 PJ in the last ten-year period, cf. tables 2.6 and 2.7.

Denmark’s dependence on oil and coal has fallen. Particularly in the production of electricity and heat, oil and coal have been substituted with other fuels. Thus, natural gas, waste and biomass are increasingly being used in small-scale and industrial CHP plants, natural gas and renewable energy is increasingly being used in large scale electricity production, and natural gas is increasingly being used for individual heating of buildings.

Figure 2.5 shows adjusted energy consumption, sector by sector. In the last 20 years relative consumption by the transport sector has risen, whereas relative domestic sector consumption has fallen.

Structure of the market

The structure of the market in the energy sector is characterised by a division between electricity, gas, and district heating supply.

Table 2.5:
Energy production in PJ

Source: Danish Energy Authority
  

Table 2.6:
Actual energy consumption in PJ

Source: Danish Energy Authority
  

Table 2.7:
Gross energy consumption, breakdown by fuels, adjusted for inter-annual temperature variations and net export in PJ

Source: Danish Energy Authority

More than two-thirds of Denmark’s electricity supply comes from large primary power stations and CHP plants. Just under one-third is supplied by small-scale and industrial CHP plants and wind turbines. The large primary power stations are organised in two companies, which are owned by around 80 regional grid companies whose owners are municipalities, limited liability cooperatives, independent institutions, etc. The small-scale plants are primarily organised in municipally owned and consumer-owned district heating companies. The wind turbines are primarily privately owned or owned by the electricity companies.

Figure 2.5:
Adjusted energy consumption, breakdown by sector

Source: Danish Energy Authority

In connection with the implementation of the EU Directive on liberalisation of the electricity sector, a reform of the sector has been carried out. As part of the reform, the market was fully opened on 1 January 2003, which means that all electricity customers can now use the electricity supplier of their choice.

Figure 2.6:
Energy prices for domestic users in current prices in DKK

Source: Danish Energy Authority

Most production of natural gas and oil is taken care of by a private company, DUC (Dansk Undergrunds Consortium), while the state-owned company DONG (Dansk Olie og Naturgas) takes care of the transportation of natural gas to the shore. DONG also owns and operates the national transmission grid for natural gas and part of the distribution grid. In addition, three regional gas companies under municipal ownership, own and operate regional natural gas grids, with distribution to the end users.

In the gas sector, too, a law reform has been passed to implement the EU Directive on liberalisation of the gas market, and the government’s aim is for the gas market to be open for all gas customers from 1 January 2004.

Approximately half of the demandfor heating is supplied by district heating. The heat is supplied from primary and small-scale CHP plants, waste incineration plants and biomass-fired district heating stations. Apart from the primary plants, the plants are owned either by municipalities or by local cooperatives that are owned by the consumers. Initially, district heating will not be covered by the liberalisation process, but the government will investigate whether it is possible in the longer term to have a more free choice of supplier in areas with large, interconnected district heating grids.

Prices and taxes

Energy prices are one of the key factors governing energy consumption. In 2000 total spending on energy, including taxes and VAT, amounted to DKK 118.1 billion. Of this figure, domestic users paid DKK 56.2 billion, manufacturing industries DKK 27.7 billion, and the commercial sector and the service industries, including public services, DKK 24.5 billion. As a general rule, enterprises subsequently receive a full refund of energy taxes and VAT, but not of CO₂ taxes.

Figures 2.6 and 2.7 show the energy prices paid by domestic users. Figure 2.6 shows the current consumer prices, including taxes and VAT. Figure 2.7 shows the development in fixed 2001 prices. The fixed prices have been adjusted for the change in general prices according to the consumer price index.

The prices of heating oil and natural gas follow each other because this is laid down by law. The tax on petrol has varied considerably over time, which has affected the price of petrol.

Measured in fixed prices, the prices of petrol, heating oil and natural gas fell from 1980 until the early 1990s, cf. figure 2.7. The price of electricity remained relatively constant for the whole of the period, although with a rising trend in the later years, primarily because of higher taxes.

As an added incentive to enterprises to improve their energy efficiency, a green tax package with gradually increasing CO₂ and energy taxes was introduced in 1996. Enterprises with a particularly high energy consumption can contract with the Danish Energy Authority on energy-efficiency improvements in return for a discount in the CO₂ taxes.

In 2000 the revenue from energy taxes amounted to DKK 33.0 billion, up from DKK 31.9 billion in 1999. The largest contribution, DKK 10 billion, comes from petrol. Total revenue has increased by 140% in relation to 1990, when there were no CO₂ and sulphur taxes. In 2000 energy taxes accounted for more than 5% of total tax revenue.

Figure 2.7:
Energy prices for domestic users. Fixed 2001 prices in DKK

Source: Danish Energy Authority
   

Figure 2.8:
Revenues from energy, CO₂, and sulphur taxes. Current prices in billion DKK

Source: Danish Energy Authority

Trade

In 2000 net foreign exchange earnings from energy products amounted to DKK 13.1 billion. There was a profit on the trade in oil, natural gas, and electricity, but a loss on the trade in coal.

2.1.7 Transport

Efficient and flexible transportation of goods and persons is a vital element of the foundation of the modern welfare society. At the same time, transport is in itself an important economic sector that contributes to economic growth, employment, and foreign exchange earnings.

The positive effects of the transport sector must be seen against the fact that the sector burdens society in different areas – traffic accidents, air pollution, noise, congestion, and CO₂ emissions. In Denmark, this burden has been reduced in some important areas – primarily in the form of better traffic safety and less air pollution – at the same time as traffic has increased.

Table 2.8:
Import and export of energy

Look here!

However, there has not been a corresponding development with respect to CO₂, and the transport sector has not yet succeeded in decoupling economic growth and greenhouse gas emissions, as has been done in the energy sector. Transport activity, energy consumption and CO₂ emissions within the transport sector have developed largely in step with economic growth. One reason for this is that a number of measures that have been used in other sectors, e.g. the energy sector, including efficiency improvement and substitution of energy sources, have not been directly available or have been associated with heavy costs in the transport sector.

The developments in passager and goods transport activities are shown in table 2.9 and 2.10 respectively In 2001 the transport sector’s CO₂ emissions were approximately 18% higher than the level in 1990. In 2001 the transport sector accounted for about 22% of Denmark’s total CO₂ emissions. Its contribution to Denmark’s total greenhouse gas emissions are calculated as a share of the total emissions of greenhouse gases, which include industrial gases, methane, and nitrous oxide. Calculated in this way, the sector is responsible for about 18% of total emissions. The trend in CO₂ emissions in the transport sector is therefore of considerable importance to the total trend in the greenhouse gas emissions.

Table 2.9:
Trend in passenger transport activity, in bill. person km

Source: Ministry of Transport
  

Table 2.10:
Trend in goods transport activity, bill. tonne km

Note: 1 Pipelines not included
Goods transport by air accounts for only a small proportion of total goods transport.
Source: Ministry of Transport

2.1.8 Business sector

In Denmark the production value of industry is approximately 30% of total national production. Table 2.11 shows that the largest industries in Denmark are the food, drink and tobacco, engineering, electronics, and the chemical industry.

The business sector as a whole (industry, building and construction, and public and private services) accounts for around 13% of Denmark’s total emissions of greenhouse gases. CO₂ from energy consumption accounts for by far the largest part of these emissions, but the sector is also a direct source of emissions of industrial greenhouse gases.

In Denmark, the industrial sector’s energy consumption accounts for about 20% of total energy consumption. This 20% does not include energy consumption for transport and space heating.

The sector’s energy consumption has varied greatly over the last 20 years. Up to 1983, consumption fell considerably due to increases in the price of oil. When oil prices fell in 1986, energy consumption began rising again. In the period 1990-2001 energy consumption in the industrial sector rose by just under 9%, while electricity consumption in the same period increased by almost 22%.From 2000 to 2001 energy consumption rose by just under 2% owing to a considerably higher level of activity. Since 1994 energy consumption per produced unit has fallen,see figure 2.9.

Table 2.11:
Turnover by industry in 2002, DKK mill.

Source: Statistics Denmark

The main action against the industrial sector’s energy consumption has hitherto been based on the green tax package for businesses passed by the Folketing in 1995. The package contained a combination of taxes and rebates to enterprises through, among other measures, government grants to promote energy savings by enterprises.

Figure 2.9:
Energy and electricity intensity in the industrial sector, based on energy data adjusted for inter-annual temperature variations

Source: Danish Energy Authority and Odyssee

The development in the last few years since the introduction of the green tax package shows that it is possible to increase industrial growth without a corresponding increase in energy consumption and CO₂ emissions. On the contrary, during increased growth it has proven possible to keep energy consumption constant and reduce CO₂ emissions from energy consumption by the industrial sector.

For industrial greenhouse gases (HFCs, PFCs and SF6), regulation through taxes, and rules on phasing out the use of these substances have been implemented. With certain exceptions, the phasing-out process is expected to take place in the period 2003-2006.

2.1.9 Waste

The waste sector’s contribution to the emissions of greenhouse gases consists only of methane. Methane emissions come from the decomposition of organic waste at landfill sites. Emissions of the industrial gases HFC and SF6 from disposal of, for example, refrigerators and certain thermal glazing, which contain these substances, are included under the business sector.

There are also CO₂ emissions in connection with disposal of oil-based products, e.g. packaging, plastic bags, etc. Since waste incineration in Denmark is included in energy production, these CO₂ emissions must be included under the energy sector in accordance with the inventory rules from the IPCC.

Methane emissions from the waste sector are expected to fall in the future because the municipalities are now obliged to assign all waste suitable for incineration to incineration plants. This means that only a small quantity of organic waste will be deposited at landfills compared with the quantity deposited before the introduction of this obligation in 1997.

In addition, gas from a number of landfills is being used in energy production, which contributes to reducing both CO₂ and methane emissions.

Table 2.12:
Key figures for building stock in the year 2001, in mill. m²

Source: Statistics Denmark

Finally, in connection with incineration, some of the waste is used as an energy source. As many of the incineration plants as possible have been converted to CHP production. In other words, the heat is used to supply district heating, and the electricity is sold to electricity suppliers. In 2001, 32 incineration plants in Denmark converted 25% of the entire waste production and contributed 3% of the entire Danish energy production.

2.1.10 Buildings and urban structure

One-twentieth of the area of Denmark is urbanised. 85% of Danes are town-dwellers, and most enterprises, institutions, etc., are situated in owns. Many pollution problems are therefore concentrated in the towns.

Today, the total built-up area is 654 mill. m². Table 2.12 shows the distribution of the area between housing, factories, offices, etc.

Today, about 16,000 homes are built per year, which is one-third of the number built in the first half of the 1970s. House building is expected to remain at this level. In recent years, house building has accounted for slightly more than half of all investment in building activities, and about half of the investment in the housing sector has gone on alterations and extensions. Building for industry and commerce now accounts for around half of all building in towns.

Table 2.13:
Development in the main forms of heating in buildings, in % of total heated space

Source: Statistics Denmark

Towns and cities are generally characterised by separation of residential and industrial areas, industrial buildings being situated in specially designated zones on the outskirts of the towns. The growth in the service industries and the growth in manufacturing with a small environmental impact imply new possibilities for integrating industry and housing, thereby reducing the need for transport between home and work.

Table 2.14:
Use of agricultural land, livestock, and nitrogenous fertiliser

Source: Danish Institute of Agricultural Sciences, Danish Research Institute of Food Economics, Statistics Denmark.
* Data for the year 2000

Approximately two-thirds of the total building space is heated. The main forms of heating are district heating and central heating based on oil and natural gas. Half of the heated space is heated by district heating and, as seen from table 2.13, the use of both district heating and natural gas has increased at the expense of oil.

2.1.11 Agriculture

In the last 40 years the area used for agriculture has fallen from 72% (30,900 km²) of the total area in 1960 to 62% (26,756 km²) in 2000. Table 2.14 shows the breakdown by type of crop over the last 30 years. The proportion of agricultural land under grass and greenfeed in rotation and permanent grass fell considerably from 1970 to 1990, but rose considerably during the 1990s, due partly to increasing use of grass fields for dairy farming, and partly to the change in EU subsidy schemes, which means that grass or industrial seed must be grown on set-aside land.

From 1980 to 2001 the number of farms fell from 119,155 to 53,489. In the same period the average size of farms increased from 24 ha to 50 ha. This development has reduced the importance of agriculture to employment and the national economy. However, agricultural production has grown, both in quantity and value, and agricultural exports still make up a large proportion - 11% - of Denmark’s total exports.

During the 1990s interest in organic farming increased considerably. In 2001 organic farms accounted for approximately 5% of land under cultivation.

In the last 30 years use of nitrogen by agriculture has varied greatly, cf. table 2.14. Up to 1990 there was a big increase in the use of nitrogenous fertiliser, but during the 1990s use of this type of fertiliser fell considerably, and in 2001 nitrogen consumption was below the 1970 level. The nitrogen content of manure has probably remained approximately unchanged in the entire period in question. Consumption of phosphorus and potassium in fertilisers fell throughout the period.

The cattle population fell by 33% from 1970 to 2001, cf. table 2.14. Most of the cattle are dairy cows. Since milk production remained approximately unchanged throughout the period, the fall in cattle population is due to higher productivity per animal. In the same period, the pig population increased by 51%. The sheep population has doubled in relation to 1970, while after falling during the 1980s, the poultry population is now higher than it was in 1970.

Agriculture was responsible for 20% of Denmark’s total emissions of greenhouse gases in 2001. The proportion is expected to be down at 16% in 2010. The gases are mainly methane and nitrous oxides. CO₂ from fuel consumption in the agricultural sector accounts for 3.6% of total Danish emissions.

2.1.12 Forestry

Approximately 11% of Denmark is forested. Originally focus was mainly on the potential of conifers, but in recent years focus has changed towards indigenous, deciduous tree species as offering greater long-term production and nature potential. Denmark’s forests are managed as closed canopy forests. The main objective is to ensure sustainable and multiple-use management of the forests and to manage them in line with the overall management of the countryside. Instead of clear-cut systems, forest owners are to a higher degree applying near-to-nature forest management regimes. Unlike our Scandinavian neighbours, Denmark is not a country in which forestry plays an important role in the national economy.

The Danish Forest Act protects a very large part of the existing forests against conversion to other landuses. Afforestation, for which public subsidies are made available, is as standard protected as forest reserve. In principle, this means that most of the forested land in Denmark will remain as forest.

A target has been set of 20-25% of Denmark being forest landscapes by the end of the 21st century. A considerable increase in the forest area is therefore to be achieved.

Denmark is the only part of the Kingdom in which forestry is practised. Greenland and the Faroe Islands have almost no forest.

2.2 Greenland

Greenland has had home rule since 1979. The Home Rule Government consists of a directly elected parliament (the Landsting), comprising 31 members. A general election is held every four years. The Landsting elects a government (the Landsstyre), which is responsible for the central administration under the Prime Minister (the Landsstyreformand). The members of the government head the various ministries.

However, since Greenland is part of the Kingdom of Denmark, some fields of responsibility remain under the state, including the Constitution, the right to vote, eligibility for election to the Folketing, the administration of justice, the concept of citizenship, foreign policy and the National Bank.

The Home Rule Government is responsible for other areas, including transport and communication, and the environment and nature. Greenland is not a member of the EU, but has an OCT scheme (Overseas Countries and Territories scheme) that ensures the country open access to the European market for its fish products.

International agreements entered into by the Danish government also cover Greenland and apply to Greenland to the same extent unless the Home Rule Government specifically requests exemption or deviation from them. Denmark’s ratification of the Climate Convention and the Kyoto Protocol both cover Greenland.

2.2.2 Population

Greenland has a population of slightly more than 56,000, 88% of which were born in Greenland. Most of the remainder of the population comes from Denmark.

Fishing is the main industry, and it is estimated that about 2,500 people are directly employed by it. In addition, around 3,000 people work in the fisheries industry and derivative occupations.

2.2.3 Geography

With an area of 2.2 mill. km², Greenland is the world’s largest island. It extends over almost 24 latitudes. Nordpynten lies only 700 km from the North Pole, and Kap Farvel, 2,600 km further south, is level with Oslo. Towards the south, the height of the sun and thus the length of day and night are almost as in Denmark. Towards the north there is the midnight sun and winter darkness, both lasting for two thirds of the year.

85% of Greenland is covered by a continuous, slightly convex ice cap, which reaches a height of more than 3,000 m above sea level. In a borehole drilled in the central part of the ice cap, the drill reached a depth of 3,030 m in the bedrock.

The remaining 15% of the island is home to Greenland’s flora and fauna, and here, on the edge of the ice cap, the people live – mainly in the coastal areas, from which there is access to open water.

2.2.4 Climate

Greenland’s northern location and the cold and more or less ice-filled seas that surround it are the main reasons for its cold climate.

Greenland has a mostly arctic climate, and forests cannot grow there. Particularly the northern part of the country is close to the North American continent, separated from it by only a relatively narrow and ice-filled sea. The position of south Greenland, on the other hand, means that the climate here is influenced by the North American continent to the west, and the ocean to the east.

Atmospheric pressure

Atmospheric pressure is generally highest in April/May. The weather in Greenland is most stable at this time of year. After this, in the summer months, the variation in atmospheric pressure is small, but in winter it is much greater, with a generally higher atmospheric pressure towards the north than towards the south, leading to a higher frequency of cold winds from northerly directions and higher wind velocities.

The biggest pressure extremes in Greenland occur in the winter period because of the great temperature contrasts in the atmosphere. The highest atmospheric pressure measured in Greenland was 1059.6 hPa, which was recorded in January 1958. The lowest was 936.2 hPa, recorded in 1986 and 1988.

Wind

Storms typically occur in connection with the passage of low-pressure systems. Between these systems, there are undisturbed periods of varying duration throughout the year, when the wind is governed by local conditions.

An example is the ice cap’s katabatic wind system, the extent of which is enormous. A katabatic wind is a wind that blows down an incline, moving from the central part out towards the edge. The wind velocity accelerates with increasing incline of the surface, and the topography can cause channelling, resulting in an extremely high velocity at the edge of the ice.

Greenland has many days with little or no wind. In some places on the east coast this is the case for 60% of the time.

Gusts can be very strong. Gusts of up to 75.1 m/s were measured in Danmarkshavn in 1975, but even stronger gusts undoubtedly occur in connection with the so-called piteraqs. These fall winds, which are katabatic, locally channelled winds from the ice cap, occur in several locations in Greenland, and are characterised by a very abrupt change from light wind to storm. In Greenlandic, piteraq means "that which assaults one".

Look here!

Figure 2.10 :
Annual mean temperature 1873-2000 in ºC, stations in Denmark, the Faroe Islands and west Greenland
   

Look here!

Figure 2.11 :
Annual mean temperature 1873-2000 in ºC, stations in Denmark, the Faroe Islands and east Greenland

Temperature

The summer temperatures on both the west and the east coast differ by only a few degrees from south to north, despite a distance of more than 2,600 km. The reason for this is the summer midnight sun in north Greenland. Conversely, winter darkness and the absence of warm sea currents mean that the temperature during the winter period differs considerably from north to south.

There is also a big difference in the temperature conditions at the outer coast and inside the fjords. In summer, drift ice and the cold water along the coast can mean that it is warmer inside the fjords, while in winter, on the other hand, the presence of the sea makes it warmer in the coastal areas than inside the fjords.

Foehn winds can disturb this picture in the wintertime. Foehn winds are very common in Greenland, and in winter the hot, dry winds can cause the temperature to rise by 30ºC within a relatively short space of time, resulting in melting of snow and ice. The temperature record of 13.9ºC from 23 November 1987 in Nuuk is an example of the effect of a Foehn wind.

The highest temperature recorded in Greenland since 1958 is 25.5ºC. It was recorded at the "ice cap" station in Kangerlussuaq in July 1990.

In Greenland, frost can occur in all the months of the year except deep inside the fjords at Narsarsuaq Airport and Kangerlussuaq for a couple of the summer months. The "frostfree" period in southern Greenland varies from 60 to 115 days per year.

The coldest place in Greenland is naturally on the ice cap, where the temperature can fall to below -70ºC. Temperatures in Greenland have shown a slightly rising trend for the last 125 years, although, on a shorter time scale, temperatures have generally fallen since the 1940s. This has been most marked on the west coast, where a rising trend has only been seen over the last few years. On the east coast, however, there has been a rising trend since the 1970s.

Precipitation

Recorded precipitation in Greenland decreases with rising latitude and from the coast to the inland area. Particularly for southern stations there is considerable seasonal variation.

Right down in the south and particularly in the south-eastern region, precipitation is significant, average annual precipitation ranging from 800 to 2,500 mm along the coasts. Further inland, towards the ice cap, considerably less precipitation is recorded. In the northern regions of Greenland there is very little precipitation, from around 250 mm down to 125 mm per year. In a few places there are "arctic deserts", i.e. areas that are almost free of snow in winter, and where evaporation in summertime can exceed precipitation.

Not surprisingly, snow is very common in Greenland. In fact, at most stations in the coastal region it can snow all year round without snow cover necessarily forming. There are thus many days with snow during the year, mostly in the southern part of the country. The snow depth is greatest in southern Greenland, averaging from one to more than two metres in all the winter months and sometimes reaching up to six metres. In southern Greenland the snow cover can disappear altogether during the winter in connection with warm Foehn winds.

Towards the north, snow cover has already formed in most places by September and normally disappears again in June/July.

Hours of sunshine

The part of Greenland north of the Polar Circle, 66,5ºN, has midnight sun and polar night of varying length depending on the latitude. Midnight sun means that the sun is in the sky 24 hours a day, while polar night means that the sun does not rise above the horizon at all.

Despite the polar night, the northern stations have more hours of sunshine than the southern stations. This is due to the "long" day, of course, but also to generally less cloud cover. However, although the surface of the soil receives more solar heat than in the tropics at around the summer solstice because of the long day, a considerable part of the energy is reflected because of the oblique angle of incidence and the snow- and icecovered surfaces.

2.2.5 Economy

Principal income for the Home Rule Government comes from transfers from the Danish state – the so-called block grant. In addition, the Landsstyre and the municipalities have revenue from personal and corporate taxes, indirect taxes, and licences. There is no VAT. In addition, Greenland receives payment from the EU for access by EU fishermen to Greenland’s fishing waters.

Greenland uses the Danish currency, and Danish currency laws apply in connection with the transfer of funds between Greenland and other countries. This means that, in several areas, Greenland is affected by factors, e.g. interest and exchange rates that are determined by external factors.

Exports

87% of Greenland’s exports of DKK 2,251 million in 2001 consisted of fish products, 60% of which were prawns. The export value of fish products is heavily dependent on the prices on the world market. Although there was a considerably greater production of prawns in 2001, falling prices on the world market considerably reduced the export value.

Imports

Apart from fishery and hunting products, only a few goods are made in Greenland. Imports therefore include primarily all goods used in households, businesses and institutions, and for investment. In 2001 imports amounted to DKK 2,466 million.

2.2.6 Energy

As in other modern societies, a large part of Greenland’s CO₂ emissions come from energy production and supply. Approximately 55% of all energy consumption is used for heating and electricity. Because of the big distances between towns in Greenland it is neither financially nor technically viable to establish a supply grid connecting them. This means that each town has its own power plant or CHP plant, and each village has its own power plant – so-called island operation. At the same time, the climatic conditions mean that the towns cannot tolerate lengthy interruptions in their electricity supply. It is therefore also necessary to have reserve and emergency plants.

Renewable energy

Up to 1993 all energy production for electricity and district heating was based on diesel-driven power, heating and CHP plants. From 1993, when the hydropower station at Buksefjord went into operation, the capital Nuuk, where around 25% of the Greenland’s population live, has been supplied with hydroelectricity for electric heating, lighting, and power. A small hydropower plant is now under construction in east Greenland, and a hydropower plant is planned in South Greenland.

Together with heat utilisation from waste incineration plants, this means that in 2001 about 8% of Greenland’s energy consumption (incl. transport, industry, etc.) came from renewable energy sources.

Regular studies have been carried out with a view to utilising other renewable energy sources, but for various reasons, including the high requirements concerning security of supply, the forms of energy utilisation in question have not been of interest so far in Greenland.

Heating

Since 1993 all buildings built with public subsidies in Nuuk have been supplied with electric heating, and electric boilers with interruptible electric heating have been installed in existing district heating stations. The electric boilers operate as long as surplus electricity is available. When it is not, the oil boilers take over. The electricity for this is supplied at a competitive price. In the year 2001, 35% of all electricity produced in Greenland went to permanent and interruptible electric heat in Nuuk.

In 10 towns the residual heat from electricity production is used for district heating. In addition, blocks of flats have their own individual heating plant, while most single-family houses have oil-fired central heating.

In the villages, most of the houses have a central heating furnace or oil stoves.

Electricity

Nuuk’s electricity comes from the hydropower station. The electricity in the other towns and villages is produced at diesel-driven power plants. Work is going on to optimise the utilisation of the power plants.

2.2.7 Transport

Passenger transport

All passenger transport to and from Greenland is by air, via either Copenhagen-Kangerlussuaq or Copenhagen-Narsarsuaq. From Nuuk and Kangerlussuaq there is a connection via east Greenland to Iceland.

Between towns and villages in Greenland, passenger transport is by passenger ship, aeroplane, or helicopter. Up through the 1990s both sea and air passenger traffic increased, and the increase in air traffic has resulted in a big rise in consumption of aviation fuel.

There are bus services in the larger towns, while in the smaller ones, passenger transport is by taxi. To get out into the surroundings people usually use sailing boats and dinghies. There are around 5,000 dinghies in Greenland. The use of private cars, which is not deemed to have much effect on Greenland’s CO₂ emission, is increasing. In 1990, 1,410 ordinary cars were registered by private owners, while in 2001, the figure rose to 2,097 – a 50% increase.

Goods transport

Almost all goods transport, both to and within Greenland, is by sea. A small proportion, mainly mail and perishable goods, is transported by air.

2.2.8 Business sector

The principal industry in Greenland is fishing/fisheries. In 1996, 25% of the workforce was employed by this industry. In 2001 the fishing fleet and the land-based production facilities for fish, crabs and prawns accounted for about 30% of Greenland’s entire energy consumption. The consumption is based mainly on fossil fuels. The industry is very sensitive to market fluctuations and it is therefore difficult to predict how it will develop.

A large part of the rest of trade and industry consists of service enterprises. Except for electricity and district heating, energy consumption and CO₂ emissions are not calculated separately for this part.

Exploration for oil and minerals is under way. If large-scale extraction and production are started up at some time in the future, this could have a big effect on Greenland’s CO₂ emissions.

There do not appear to be any enterprises using industrial gases in their production.

2.2.9 Waste

Approximately 30,000 tonnes of waste are produced in Greenland each year. Three incineration plants in towns incinerate about 40% of the waste, while 47 small incineration plants in villages together incinerate 13%. Less than half of the waste is sent to landfills or burnt. Three new incineration plants are expected to go into operation in 2003, which will reduce the amount of waste sent to landfills/burnt to less than 25%.

In the three existing incineration plants in towns, the heat from waste incineration is used for district heating. The heat from the three coming plants will be used in the same way, which means that the energy from more than 60% of Greenland’s waste is expected to be utilised in 2003.

The possibilities for reducing the quantity of waste sent to landfills/ burnt are being investigated.

2.2.10 Buildings and infrastructure

The government plays a very important role in the housing sector. Most housing is government housing or built with a government grant. Most private housing is built by the owners themselves, and the government offers grants for this purpose. The cooperative housing system was introduced in 1990 with government support.

A large proportion of the houses are more than 15 years old, and a refurbishment programme has been initiated. This modernisation includes reducing the energy consumption of individual houses.

2.2.11 Agriculture

Geographically, Greenland’s agriculture is placed in the south and has a very limited impact on CO₂ emissions. It consists mainly of sheep farming, and 25,000-30,000 lambs are produced each year. There are also two farms with domesticated reindeer. The number of sheep has remained relatively constant since 1990, whereas the number of domesticated reindeer has more than halved. The area farmed has increased by 85% since 1990 due to cultivation of a large quantity of coarse fodder.

2.2.12 Forestry

There is no forestry in Greenland apart from four experimental plantations with conifers, with a total area of 100 ha.

2.3 The Faroe Islands

The Faroe Islands have home rule status, and their internal affairs are governed by the Faroese parliament (the Lagting). The Faroe Islands are not a member of the EU.

International agreements entered into by the Danish government cover the Faroe Islands and apply to them to the same extent unless the Faroese government specifically requests exemption or deviation from them.

Denmark’s ratification of the Climate Convention covers the Faroe Islands as well, but at the request of the Faroese government, geographical exemption was taken for the Faroe Islands in connection with Denmark’s ratification of the Kyoto Protocol.

2.3.2 Population

In 2001 the Faroe Islands had a population of slightly less than 47,000 – an increase of 5,000 since 1977. Net immigration was relatively small up to the beginning of the 1980s but increased relatively sharply in the years 1984-89 as a consequence of a high level of economic and employment activity.

Table 2.15
Agriculture in Greenland

Source: Grønlands Statistik and the Home Rule’s Department for Trade and Industry

In the years 1990-1995 this picture changed to extensive emigration due to a serious deterioration in the economic and employment situation. In 1993 and 1994 alone, net emigration corresponded to 8% of the total population. Since 1996, the population has been growing. In 2001 the capital, Thorshavn, had a population of 18,000, corresponding to slightly less than 40% of the entire population.

2.3.3 Geography

The Faroe Islands consist of 18 small, mountainous islands situated in the North Atlantic at about 62oN and 7oW. The islands extend over 113 km from north to south and 75 km from east to west, and the total area is 1,399 square kilometres. The highest points, almost 890 metres above sea level, are on the northern islands. 17 of the islands are inhabited.

2.3.4 Climate

The climate on the Faroe Islands is strongly affected by the warm North Atlantic current and frequent passage of cyclones, which, depending on the location of the polar front, mainly come from southwest and west. The climate is characterised by mild winters and cool summers and is sometimes very damp and rainy.

The high pressure over the Azores sometimes shifts towards the Faroe Islands. This can result in stable summer weather lasting several weeks, with quite high temperatures. In winter, on the other hand, the low pressure systems can move more southerly around the islands than normal, bringing in cold air from the north and a lengthy period of sunny winter weather.

The maritime climate is also a result of the cold east Iceland current (polar current), which splits into two currents from eastern Iceland towards the Faroe Islands. The mixing of the water masses from this and the warm Gulf Stream causes a relatively big difference in the sea temperatures around the islands, and this in turn causes local variations in the climate.

Atmospheric pressure

The normal atmospheric pressure at sea level in Thorshavn is 1008 hPa on an annual basis, lowest from October to January (1004-1005 hPa) and highest in May (1014 hPa). The lowest atmospheric pressure recorded was 948.6 hPa on 11 January 1986, and the highest was 1046 hPa recorded on 20 February 1965. The islands have long periods with both low pressure and high pressure.

The Faroe Islands lie close to the normal cyclone paths over the North Atlantic, and big and frequent changes in atmospheric pressure, with rises and falls of 20 hPa within 24 hours are common throughout the year. Sometimes, however, such violent cyclones develop that pressure falls of more than 24 hPA/24 hours occur.

Temperature

The annual mean temperature in Thorshavn is 6.5°C. The temperature in January and February is around 3.5°C, and in July and August, around 10.5°C. The annual mean temperature varies from place to place and is lowest at Vága Floghavn, 6.0°C, and highest in Sandur on the island of Sandoy, 7.0°C.

In the 1990s the temperatures in Thorshavn exhibited a slightly rising trend.

Precipitation

Annual precipitation in Thorshavn is 1284 mm, most in autumn and least in summer. There are big geographical variations in precipitation, mainly due to the topography of the islands.

It rains a lot on the Faroe Islands. Indeed, the Hvalvík has as much as 300 days with precipitation, and Thorshavn, 273 days. In the winter, precipitation is often in the form of snow. On average,Thorshavn has 44 days of snowfall per year, mostly in December and January. There is no snow at all in June, July, and August, but there can be snow in September.

Precipitation in Thorshavn has exhibited a distinctly rising trend since the mid-1970s.

Thorshavn has 840 hours of sunshine per year, most in May and June, the average being around 125 hours. In some Decembers there are no hours of sunshine at all. The highest number of hours of sunshine in a calendar month was 232 hours, observed in May 1948 and in May 2000.

The location in the North Atlantic, combined with frequent low-pressure fronts, results in a large number of cloudy days (>80% cloud cover) – 221 days in Thorshavn. The number of hours of sunshine in Thorshavn has remained stable for the last 20 years.

The Faroe Islands have a moist climate, and the relative humidity is very high, 88% on an annual basis in Thorshavn. It is highest around August, and this is also when most fog occurs.

Wind

The mean wind is generally high on the Faroe Islands, particularly in autumn and winter (6-10 m/s). The wind is normally lightest in summer (4.5-6 m/s). There are normally no storms from April to August, while autumn and winter are windy, with many storms, some of which can reach hurricane force.

The highest 10-minute mean winds are about 50 m/s, recorded at Mykines Lighthouse in March 1997 and January 1999. In 1997, gusts of almost 67 m/s were recorded at Mykines Lighthouse.

Although the weather is generally windy, there are also still periods, mostly in summer and mostly of short duration.

2.3.5 Economy

Since 1995 the Faroese economy has grown rapidly, due particularly to strong growth in fisheries. In 2001 exports increased by 12%, while imports fell by just under 4%, resulting in a surplus of DKK 160 million on the balance of trade. About 80% of exports from the Faroe Islands go to EU countries. Of this, Denmark accounts for 25% and the UK for 18%. In 2001 the Faroe Islands’ GNP was DKK 9.36 million.

In the last few years, the Faroe Islands have turned a net foreign debt into a net credit balance, although with a big difference between the private and the public sector. At the end of 2001 the private sector had a net credit balance of more than DKK 5 billion, while the public sector’s net foreign debt stood at almost DKK 3 billion. Unemployment has fallen sharply in the last few years and is now around 3%. Table 2.16 shows the development and breakdown by trade and industry, measured in gross national product at factor cost.

In 2001 the surplus on the balance of payments, which, besides the balance of trade, includes services, wages, interest, transfers from the Danish state (approx. DKK 1.2 billion) and Danmarks Nationalbank, amounted to approximately DKK 900 million

The Faroe Islands use the Danish currency and are part of the Danish currency area, although they have their own notes.

2.3.6 Energy

The joint municipal company SEV is responsible for the production and sale of electricity on the Faroe Islands. In 2001, production amounted to about 230 mill. kWh. Of this, more than 30% was based on hydroelectricity, while the remainder was produced at diesel-driven plants. There is not much electricity production based on wind power – only 0.3% or 0.5 mill. KWh in 2001. The reason for this is partly the very harsh wind conditions on the Faroe Islands, which make special demands on the wind turbines and thus the investment, and partly the fact that it is deemed difficult to adapt the great alternative production of this type to the relatively weak supply grid. Calculations show that there would be room for approximately 4.5 MW wind power in the grid in the area around Thorshavn.

Table 2.16
Gross national product at factor cost, 1997 - 2001, breakdown by sector

Source: Færøernes Landsbank
    

Table 2.17
Electricity production 1998-2001, in GWh

Source: The Faroe Islands Ministry of Oil

Of the electricity sold in 2001, 33% went to domestic users, 35% to industry, agriculture, and fisheries, 14% to the service sector, and the remainder to street lighting etc.

Since a number of oil finds in British territorial waters close to the Faroese border in the 1990s, there has been a reasonable presumption that there is oil in Faroese territory, and the first licensing round was held in the spring of 2000. The first licences for exploration and production of hydrocarbons in the subsoil off the Faroe Islands were granted in August 2000. The first three exploration wells were drilled in the summer and autumn of 2001. In one of these, oil and gas were found. An evaluation programme is now being carried out to determine whether this find is commercially viable.

2.3.7 Transport

Goods transport between the Faroe Islands and the rest of the world is mainly by sea. Two Faroese shipping companies operate freighter services all year round. Since 1998, the Smyril Line has carried freight in connection with their passenger winter sailings to Denmark. The Icelandic company EMISKIP also operates freight services throughout the year and has an office on the Faroe Islands.

Besides Vagar Airport, the Faroe Islands have 12 helicopter pads. Air services are provided by MAERSK AIR, ICELAND AIR and the Faroese company ATLANTIC AIRWAYS. The number of air travellers to and from the Faroe Islands has risen sharply in the last few years.

Passenger transport by sea takes place mainly in the summer period. There are both regular services (Smyril Line) and cruise liners. The number of foreign passenger ships calling at the Faroe Islands has been increasing in recent years.

For 20-30 years up to the beginning of the 1990s and again over the last few years, major investments have been made in enlarging and modernising the transport infrastructure on the islands and the communication links with the outside world. Constructing roads, tunnels, and harbours is costly because of the difficult topographical conditions. Since an economic downturn at the beginning of the 1990s, the number of motor vehicles has increased by almost 1,000 and now stands at 21,000 motor vehicles, of which 16,000 are cars and 3,500 lorries and vans.

2.3.8 Business sector

Excluding exports of ships, which vary considerably over the years, 98% of the Faroe Islands’ export earnings comes from fish and fish products. The fishing industry is therefore of vital importance to earnings and employment on the Faroe Islands. The limited opportunities in other sectors of industry reinforce still further the totally dominant role of the fishing industry. Small villages in particular are almost entirely dependent on fisheries. In 2001 more than 27% of total wages on the Faroe Islands came from the fishing industry. Today, the number of man-years in the fishing fleet itself is estimated to be about 2,000.

Besides the actual fish industry, a number of workshops and industrial enterprises have been built up to make equipment etc. for fishing vessels and the fisheries industry. This group includes shipyards and firms making fishing tackle, and machines and equipment for filleting factories. The last few years have seen the establishment of companies exporting fishing-system solutions to countries in the third world and elsewhere. The absence of a large domestic market, high transport costs for raw materials and finished goods, and – in an international context - a relatively high level of overall costs have hitherto prevented the Faroe Islands from establishing export-oriented industries apart from the fishing industry and the firms supplying it. The Faroese government supports the development of small industry and manual trades based on sales to the domestic market.

2.3.9 Buildings and urban structure

For many years, the Faroese authorities have made every effort to counteract migration from the small or isolated villages and islands, in particular through a major road-building programme and other transport measures. However, population development is generally poorer in these outlying areas than in other parts of the country.

Housing is predominantly singlefamily houses, most of which are relatively large and of high standard.

2.3.10 Agriculture

Until the end of the nineteenth century, farming was the Faroe Islands’ main industry, but with the economic and industrial development since then, particularly within fisheries, farming today accounts for only 0.7% of the Faroe Islands’ gross national income at factor cost.

With a view to increasing the selfsufficiency of the Faroe Islands, the government is providing grants for investments in farming.

With about 5% of the land under cultivation, the Faroe Islands can supply just over half of its total demand for lamb and mutton, most of its demand of milk, a fraction of its demand for beef and eggs, and half of the demand for potatoes. In 2001 the Faroe Islands had 1,170 dairy cows and about 70,000 sheep.

2.3.11 Forestry

There is no commercial forestry on the Faroe Islands, but there are a number of plantations on the islands, which are maintained by the Faroese forestry authority.

3 Greenhouse gas inventory information

3.1 Greenhouse gas inventories

Denmark’s greenhouse gas inventories are prepared in accordance with the guidelines from the Intergovernmental Panel on Climate Change (IPCC) and are based on methods developed under the European CORINAIR programme (COordination of INformation on AIR emissions) for calculating national inventories¹.

The inventories follow the method described in CORINAIR’s guidelines² and IPCC’s guidelines³. However, in accordance with the latter guidelines, the methods and emission factors have been modified for some of the inventories so that they reflect better Danish conditions.

A description of methods, emission factors and activity data is given in Denmark’s national emission inventory reports (NIR)⁴ to the Climate Convention. For the last two years these reports have included data in the common reporting format(CRF). The latest NIR and the latest combined Danish inventory of greenhouse gases and other air pollutants can be seen at the National Environmental Research Institute’s website⁵ and in Illerup et al., 2002.

Preliminary greenhouse gas inventories, for Greenland and the Faroe Islands are included in the annual inventory report to the Climate Convention.

3.2 Denmark’s emissions and removals of greenhouse gases

Denmark’s emissions of the greenhouse gases CO₂ (carbon dioxide), CH₄ (methane), N₂O (nitrous oxide) and the so-called industrial gases, which include HFCs (hydrofluorocarbons), PFCs (perfluorocarbons) and SF₆ (sulphur hexafluoride), for the period 1990 to 2001 are shown in tables 3.1-3.4 broken down into IPCC’s six main categories and the most relevant sub-categories. The total emissions of these greenhouse gases, calculated in CO₂ equivalents on the basis of the individual gases’ global warming potential, is shown in table 3.5. The development 1990-2001, broken down by source in table 10 in the reporting format CRF reported in NIR 2002, is reproduced in Annex A.

3.2.1 Carbon dioxide (CO₂)

Almost all the CO₂ emissions come from combustion of coal, oil and natural gas at power stations and in residential properties and industry, although road traffic also accounts for a considerable part of it.

The relatively large fluctuations in the emissions from year to year is due to trade in electricity with other countries – mainly the Nordic countries. The large emissions in 1991 and 1996 resulted from large electricity exports.

From 1990 to 1996, emissions showed a rising trend, but they have fallen since 1997 because many power stations have changed their fuel mix from coal to natural gas and renewable energy. As a result of the reduced use of coal in the last years, most of the CO₂ emissions now come from combustion of oil.

Emissions from road transport in 2001 accounted for more than 20% of the total CO₂ emissions.

Table 3.1:
Trend in CO₂ emissions 1990 - 2001

Look here!
        

Table 3.2:
Trend in CH₄ emissions 1990 - 2001

Look here!
   

3.2.2 Methane (CH₄)

The man-made emissions of methane (CH₄) come from agriculture, landfill sites and energy production, with agriculture by far the largest source. The emissions from agriculture are due to the formation of methane in the digestive system of farm animals and due to treatment of manure.

The methane emissions from landfill sites are falling because the amount of waste deposited is decreasing year by year as a consequence of the abrupt fall in the quantity of landfilled waste that has occurred since 1997.

The emissions from energy production are rising because gas engines account for an increasing proportion. Gas engines have large emissions of methane compared with other combustion technologies.

Source: National Environmental Research Institute
    

Table 3.5:
Danish greenhouse gas emissions in CO₂ equivalents 1990 - 2001.

Look here!
   

The contribution of industrial greenhouse gases (HFCs, PFCs and SF₆) to Denmark’s total emissions of greenhouse gases is relatively modest, but has shown the strongest percentage rise during the 1990s. The HFCs, which are primarily used within the cooling industry, contribute most to the industrial greenhouse gas emissions. In the period 1990 to 2001, HFC emissions rose from 0 tonnes to 647,000 tonnes CO₂ equivalents. There has been a relatively small increase and decrease in PFC emissions, while SF₆ emissions have fallen considerably in the last few years.

Figure 3.1:
Danish greenhouse gas emissions in CO₂ equivalents 1990 - 2001

Source: National Environmental Research Institute
   

Figure 3.2
Greenhouse gas emissions in Denmark, breakdown by source/sector 1990 - 2001

Source: National Environmental Research Institute
  

Table 3.6.
Denmark’s, Greenland’s and the Faroe Islands’ total emissions and removals of greenhouse gases 1990 - 2001

Look here!
   

3.2.5 Denmark’s total emissions and removals of greenhouse gases

Table 3.5, figure 3.1 and figure 3.2 show the trend in Denmark’s emissions and removals of greenhouse gases, given in CO₂ equivalents and broken down into gases and sources in accordance with the general rules for inventories under the Climate Convention. CO₂ is the main greenhouse gas, followed by N₂O and CH₄. It will be seen that there was a general fall in these emissions from 1996, when total emissions were (excluding LUCF) 90.8 million tonnes CO₂ equivalents, to 2000, with total emissions of 68.1 million tonnes CO₂ equivalents, while the total emissions in 2001 were 69.3 million tonnes CO₂ equivalents. Of the total greenhouse gas emissions in CO₂ equivalents, CO₂ accounted for 78%, methane for 8%, nitrous oxide for 13% and the industrial gases HFCs, PFCs and SF₆ for 1% in 2001. After deduction of the CO₂ removals in forests, the total net Danish greenhouse gas emissions were 65.9 million tonnes CO₂ equivalents in 2001.

As will be seen from section 3.4, an inventory based on the rules under the Kyoto Protocol means certain changes with respect to base year and removals in connection with land-in-use change and forestry (LUCF).

3.3 Denmark’s, Greenland’s and the Faroe Islands’ total emissions and removals of greenhouse gases

The total inventories for Denmark, Greenland and the Faroe Islands (the Kingdom) are given in table 3.6. As will be seen, the Climate Convention’s goal of getting the level in 2000 down to the 1990 level was achieved. In 2000, the total level for Denmark, Greenland and the Faroe Islands lay 1.1% below the 1990 level.

For the time being, the inventories from Greenland contain only inventories of the CO₂ emissions from combustion of fossil fuels, which must, however, be regarded as by far the most important source of greenhouses gases.

The inventories from the Faroe Islands include both an inventory of CO₂ emissions from combustion of fossil fuels and inventories of methane and nitrous oxide emissions from agriculture.

As will be seen from the table, Greenland’s and the Faroe Islands’ greenhouse gas emissions are small compared with those of Denmark (each about 1% of the total emissions), and they have been almost constant since 1990. The sudden rise in CO₂ emissions in the Faroe Islands in 1999 was due to a relatively big rise in imports of coal briquettes, while a similar rise in Greenland was due to increased sales of arctic gas oil in the towns.

3.4 Preliminary inventories under the Kyoto Protocol and the EU’s burden-sharing

In sections 3.2 and 3.3, Denmark’s, Greenland’s and the Faroe Islands’ emissions and removals of greenhouse gases are calculated in accordance with the guidelines under the Climate Convention. Since the rules for inventories under the Kyoto Protocol differ on some points from the rules under the Convention, preliminary inventories are also made in accordance with the rules of the Protocol with a view to following the trend in relation to the obligation under the Protocol.

In accordance with the rules of the Protocol, Denmark has chosen 1995 as the base year for industrial greenhouse gases (HFCs, PFCs and SF₆),  and, for the time being, the calculation under the Protocol includes only the removals occurring in forests as a consequence of afforestation since 1990.

Denmark’s reduction obligation is related to the EU reduction obligation through the so-called burden-sharing agreement. The Faroe Islands are not covered by the Kyoto Protocol since territorial reservation was made in connection with Denmark’s ratification of the Protocol⁶.

It was a condition of agreement by Denmark to a reduction contribution of 21% to the EU’s total reduction obligation of 8% from 1990 to 2008- 2012 that account be taken of Denmark’s relatively large electricity import in 1990 by adjusting CO₂ emissions in 1990 so that these corresponded to the national energy consumption. It can thus be seen from Denmark’s declaration, given in connection with, that the basis for the 21% reduction contribution has been adjusted. In connection with the EU ratification of the Kyoto Protocol, Denmark gave a legal undertaking to deliver a 21% reduction on the basis of the actual emissions level in 1990. The Council decision on the EU’s ratification of the Protocol also refers to the fact that, in connection with the signing of the EU’s agreement on the distribution of burdens in June 1998, certain Member States presented assumptions concerning emissions in the base year and common and coordinated policies and measures. In June 1998, Denmark was the only country to present a declaration with written assumptions concerning the base year. In connection with the decision on ratification by the EU, the Council and the Commission agreed on a joint declaration. This stated, inter alia, that the permitted emission levels (measured in tonnes CO₂ equivalents) for the period 2008-2012 should be set taking account of the assumptions concerning emissions in the base year that also appear in the relevant declarations made in connection with the signing of the agreement on the distribution of burdens in June 1998. The permitted emission levels (measured in tonnes) are to be set not later than  2006. The setting of emission levels for the Member States will not affect the EU’s total reduction target of 8% measured in tonnes.

Table 3.7 shows the trend in Denmark’s emissions and removals under the Kyoto Protocol in relation to the goal of a 21% reduction from the base year   (1990/95) to 2008-2012, which Denmark has given a legal undertaking to achieve. To show the importance of the above-mentioned reference and declarations, table 3.7 also shows the trend in relation to a base year in which the CO₂ emissions in 1990 are adjusted for electricity imports.

Table 3.7.
Denmark’s total emissions and removals of greenhouse gases, 1990 – 2001, cf. the Kyoto Protocol and the EU’s distribution of burdens

Look here!

As far as is known, the trend in Greenland’s emissions, calculated under the Kyoto Protocol,does not differ from the preliminary inventories of CO₂ from use of energy calculated under the Climate Convention and appearing in table 3.6.

The preliminary inventories form the basis for Denmark’s climate strategy, as described in chapter 4.

4 Policies and measures

4.1 Climate policy and the decision-making process

Since the Brundtland Commission’s report "Our Common Future" from 1987, Denmark’s climate policy has been developed in interaction with the different sectors of society, international climate policy and the results of related research.

Since the end of the 1980s many initiatives have been taken to reduce the emissions of greenhouse gases. The initiatives have produced important results – particularly with respect to CO₂ – and will lead to further reductions in the emissions of greenhouse gases in the future.

The initiatives have been – and still are –  directed primarily towards the sectors of society whose activities are connected with considerable emissions of greenhouse gases.

The initiatives have the objective of broad environmental improvements in society and include environmental taxes and involvement of the population in the debate and the decisionmaking process in the environmental field.

A new objective is to ensure cost-effective action in order to achieve more environment for the money.

In order to monitor the development of the overall effect of the initiatives on the emissions of greenhouse gases from energy consumption in Denmark, the basis for and follow-up on Denmark’s action to reduce the emissions include emission inventories that are adjusted for inter-annual temperature variations and variations in Denmark’s import/export of electricity .

International climate objectives

Since 1990 Denmark has undertaken or committed itself to several targets with respect to reducing greenhouse gas emissions:

Section 4.1.1 gives a short description of the general, democratic decision-making processes, to which Denmark’s climate policy is also subject.

4.1.1 National action plans

In 1988 the government of that time issued "The Government’s Action Plan for Environment and Development". The plan was a follow-up on the Brundtland Report and was based in principle on striving for environmentally sustainable development. One of the main messages in the plan was the need to integrate environmental considerations in decisions and administration within such sectors as transport, agriculture and energy.

In the years since then a number of ministries have prepared sector action plans in which environment is an integral element. The sector action plans thus deal with the entire development in a sector combined with solutions of environmental problems caused by the sector. The sector  plans for energy, transport, forestry, agriculture, aquatic environment, waste, and development assistance are important examples.

The plans from the 1990s all contained specific environmental objectives and, usually, deadlines for a hieving them. In addition, there were a number of concrete initiatives that are intended to lead to achievement of the objectives. Progress has been evaluated regularly to check whether the implementation of the plans resulted in achievement of the objectives. The results of the evaluations have been presented in political reports from the sector ministries or in special follow-up reports.

The evaluations and follow-up have often given rise to the preparation of new action plans, either because additional initiatives have been necessary in order to achieve the objectives or because the development of society or the development within the area in question has made it necessary to change both objectives and initiatives.

Major sector plans that have been of importance for the reduction of greenhouse gas emissions are:

The sector plans deal with different aspects of the climate problem. In the energy and transport sectors the main environmental concern has been the emissions of the greenhouse gas CO₂. The plans in these sectors were therefore to a great extent concerned with reducing CO₂.

The other sector plans are not primarily focused on reducing greenhouse gas emissions, in part because the sectors are battling with other major environmental problems that efforts have been made to solve through the plans. The main concern in the agricultural sector has been pollution of the aquatic environment. In the waste sector it has been reduction of the volume of waste, and in the industrial sector, reduction of emissions/discharges of harmful substances to the atmosphere/aquatic environment, the use of toxic substances, etc.

However, the implementation of the sector plans has to a great extent also resulted in reduction of greenhouse gas emissions. For example, the reduction in the agricultural sector’s nitrogen emissions, which the aquatic environment plans are resulting in, is at the same time reducing the emissions of the greenhouse gas nitrous oxide. The initiatives to reduce waste quantities mean fewer landfill sites and thus less formation and emissions of methane, and the ongoing increase in forested area will mean increased removals of CO₂.

In addition, the energy and transport plans meant that changes were made in the energy and transport areas in all sectors. The initiatives in the energy area have thus resulted in reduced energy consumption and, with that, reduced CO₂ emissions within a wide range of sectors, including the domestic sector and the business sector.

In June 2002 the government’s national strategy for sustainable development in Denmark, "A SHARED FUTURE – balanced development" was adopted by the Folketing. The strategy must be seen in part as one of Denmark’s responses to the challenge of Agenda 21, which was adopted at the UN General Assembly in Rio in 1992. The government lists eight objectives and principles for creating sustainable development:

1. The welfare society must be developed and economic growth must be decoupled from environmental impacts.
2. There must be a safe and healthy environment for everyone, and we must maintain a high level of protection.
3. We must secure a high degree of biodiversity and protect ecosystems.
4. Resources must be used more efficiently.
5. We must take action at an international level.
6. Environmental cosiderations must be taken into account in all sectors.
7. The market must support sustainable development.
8. Sustainable development is a shared responsibility, and we must measure progress.

The strategy is built up with a number of sectors: food production, forestry, industry, transport, energy, urban and housing development, and intersectoral action: climate change, biodiversity, environment and health, resources and resource efficiency, knowledge and policies and measures, the global dimension and public participation.

In order to follow developments in relation to the strategy, regular indicator reports are prepared. The first, from August 2002, contains 14 key indicators – including indicators for economic growth, greenhouse gas emissions, air pollution, employment and discharge of nutrients to the marine environment. In addition, the trend in a wide range of more specific indicators is being monitored. Examples of these indicators are the l ng term development in average temperatures near ground level globally and in Denmark, the beginning and the size of the pollen season, the incidence of asthma, the thickness of the ozone layer, by-catches of porpoises, the amount of PCB in cod liver and the number of organic farms. The conclusion of the indicator report is that Denmark is on the way to sustainable development since the indicators show that Denmark’s stable economic growth has happened without corresponding increases in a number of environmental parameters. For example that energy consumption and greenhouse gas emissionss have not risen in step with the economy, and that the consumption of drinking water and discharges of acid substances have fallen.

On the environment policy front, Denmark has participated actively in improving environmental protection in Europe through the EU cooperation and through bilateral environmental assistance to Central and Eastern European countries. On a number of points, the EU’s environmental regulation has put Europe ahead of the rest of world environmentally. There are also many examples of EU rules having helped to strengthen environmental protection in Denmark. With the adoption of the Amsterdam Treaty, sustainable development became a main objective for the EU, and integrating environmental considerations in the EU’s sector policies became an obligation.

4.1.2 Denmark’s new climate strategy

In February 2003 the government published Denmark’s new climate strategy. The basis of the strategy is that Denmark must fulfil its international climate obligations following from the Kyoto Protocol and the subsequent EU burden sharing agreement.

Although many important initiatives have already been launched in order to live up to the climate objective, considerable work still remains before Denmark can live up to its very ambitious Kyoto objective. According to the latest projection of Denmark’s emissions of greenhouse gases¹, it is estimated that, unless additional measures are initiated, Denmark will be 20-25² million tonnes CO₂ equivalents per year short of achieving its reduction obligation under the Kyoto Protocol in the period 2008-2012.

It is therefore vital in the climate strategy to plan the action cost-effectively.

The Kyoto Protocol offers the possibility of planning climate action that is more flexible and that, globally, gives more environment for the money. The climate strategy combines cost-effective national measures with use of the Kyoto Protocol’s flexible mechanisms.

For many of Denmark’s energy producers and a large part of the energy- intensive industry, the coming EU Directive on a scheme for trading with greenhouse gas emissions within the Community will form the framework for the coming action. The companies that will be covered by the scheme, and whose activity will be   regulated by a quota, will be able to plan their climate action themselves. They can choose to reduce their own emissions when that is most appropriate or to buy quotas or credits from project-based emission reductions when that is deemed most suitable. This means that the companies  concerned will be able to adjust their action on an ongoing basis so that it is always as effective as possible.

Reduction is primarily a task for the private sector, but government action can supplement the private sector action and, in the start-up phase, help to get the market for CO₂ credits going.

Besides quota management and use of flexible mechanisms, the climate strategy includes a number of national measures, including initiatives to promote continued energy savings and improve of energy efficiency.

Within the agricultural sector there may also be possibilities for reducing greenhouse gas emissions. However, the potential has not been sufficiently clarified at the present time, and the possibilities for additional cost-effective measures within this sector willbe analysed in connection with a coming Action Plan for the Aquatic Environment III.

Within transport the selected analyses carried out show that national solutions for the most part are relatively expensive. However, it is estimated that more efficient and less expensive initiatives may be carried out jointly at EU level.

Since the reduction costs in the different sectors are constantly changing as a consequence of technological development and changed economic framework conditions, the strategy includes regular evaluation of the action in order to ensure that the most cost-effective policies and measures are chosen.

The picture of potentials and economic reductions in costs that can be given at the present time for selected national measures to reduce greenhouse gas emissions are shown in table 4.1.

Table 4.1
Reduction possibilities and cost of selected measures to reduce greenhouse gas emissions

DKK 100 per tonne CO₂ equivalents, and will most likely be DKK 40-60, assuming that the USA remains outside the Kyoto system. With this price level it will be considerably cheaper to buy international quotas/ credits than to implement most of the national reduction measures. However, to be able to compare the economic unit costs of the national reduction measures with the price of international quotas/credits, the price must first be adjusted with the socalled net tax factor, whereby the cost of acquiring quotas/credits is calculated in consumer prices, which are the comparable quantity across measures. In an economic analysis, the main price estimate for quotas/credits of DKK 40-60 is an expression of costs of DKK 50-70 per tonne CO₂ equivalents.

In a comparison with the national policies and measures, it is important to be aware that these must typically be seen in a sector-political context, in which climate is just one of many considerations in the policy planned. For example, a fundamental consideration in the energy sector is security of supply, which, all else being equal, is improved by a lower energy consumption and a diversified energy supply.

The analyses carried out do not cover every conceivable national measure, and the costs may change in the coming years as a consequence of new knowledge and new technologies. An interministerial committee will regularly evaluate the costeffectiveness of the national policies and measures, including new ones that are not mentioned in table 4.1. The government has set an economic marker of DKK 120/tonne CO₂ equivalents to be used as a basis for implementing national policies and measures outside the area covered by the EU trading scheme. The analyses show that only relatively few national policies and measures with a significant potential, that do not exceed DKK 120/tonne CO₂ equivalents, would be able to compete with the price of using the flexible mechanisms. This must be seen in the light of the fact that Denmark has already made a massive national effort up through the 1990s, while there is a large, unexploited potential in other countries.

For the national policies and measures, where the analyses show relatively low reduction costs, the potential is, all in all, insufficient to meet the need for making up the Danish reduction shortfall. On the other hand, there is considered to be a considerable potential for buying quotas and credits internationally.

For these reasons, the government's cost-effective strategy for meeting Denmark's reduction obligation is to a certain extent based on the use of flexible mechanisms - emissions trading and the project mechanisms, Joint Implementation and the Clean Development Mechanism. The EU trading scheme will be a key instrument. The actual composition of the action will therefore depend on the extent to which the companies concerned choose to implement their own reduction measures or to buy quotas abroad.

Table 4.2
Aggregation of sources/sectors in the CRF/IPCC format to the six main economic sectors in Denmark

Table 4.3
Denmark’s emissions of climate gases in 1990/95 and 2001, together with projections, breakdown by economic sector

Look here!

4.2 Policies and measures and their effects in Denmark's economic sectors

In sections 4.2.1 to 4.2.6 below, policies and measures of importance for emissions and removals of greenhouse gases are examined within the following six economic sectors: energy, transport, the business sector, agriculture and forestry, the domestic sector and waste. Table 4.2 shows how the sector classification that is to be used in connection with the annual emission inventories (the CRF/IPCC format) is aggregated to the six economic sectors.

Table 4.3 shows the main result of this aggregation for the base year, 2001, 2008-2012 and 2013-2017.

Figure 4.1
Denmark’s emissions of greenhouse gases in 2001, breakdown by economic sector

Source: National Environmental Research Institute and the Danish Environmental Protection Agency

4.2.1 Energy

The energy sector's production, conversion, and distribution of energy account for 40% of Denmark's total greenhouse gas emissions, and mainly the greenhouse gas CO₂ is emitted. 97% of the total greenhouse gas emissions from the energy sector is CO₂, 2% is methane (CH₄) and 1% is nitrous oxide (N₂O).

CO₂

Energy production and energyconsuming activities in the transport sector, industry and the other sectors are the main contributors to the total emissions of CO₂ due to use of large quantities of coal, oil and natural gas.

The energy sector is therefore centrally placed in the efforts to reduce the emissions of CO₂. Many initiatives have been taken over the years to reduce the emissions, and work is still going on to find the best and most cost-effective measures with a view to fulfilling Denmark's international climate obligations.

The focus of this section is energy production and energy supply. The energy-consuming activities and the possibilities for energy savings in the different sectors of society are dealt with in greater detail in the subsequent sections.

Implemented policies and measures

Some policies and measures can bring general pressure to bear on players in the energy sector to get them to reduce their CO₂ emissions. Denmark's national Quota Act, which regulates the emissions of CO₂ from open, market-regulated production of electricity is an example.

The CO₂ Quota Act puts a ceiling on the electricity producers' CO₂ emissions. If the producers exceed a set quota, a penalty tax is imposed on them for every tonne by which the quota is exceeded. The producers can decide for themselves how they keep to the quota - whether by energy efficiency improvements at their plants, by changes in fuel or by reducing production. The Danish producers can also trade quotas among themselves.

Taxes have also been used for many years as an instrument for reducing the CO₂ emissions from the energy sector, since fuels used for heat production have been subject to a CO₂ tax and an energy tax for many years, partly with a view to a general reduction in energy consumption and partly to promote fuels with lower CO₂ emissions - primarily biomass, on which there is no CO₂ tax and, in the case of most applications, no energy taxes either. R&D activities include energy savings, more efficient energy conversion and renewable energy technologies.

Table 4.4
Policies 0r measures in the energy sector