The Referential Significance of “Danish Green Development Model” to China’s Construction of Eco-Civilization and Resource-saving Society

Che Wei 2013-08-28
From:BFA
After more than three decades of fast economic growth, China is now confronted with increasingly higher pressure from energy shortage and environment deterioration. How should China take a sustainable development? Is there any reference from other countries that can be borrowed to reduce detour and waste?

 

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fter more than three decades of fast economic growth, China is now confronted with increasingly higher pressure from energy shortage and environment deterioration.  How should China take a sustainable development? Is there any reference from other countries that can be borrowed to reduce detour and waste? Our comparative studies of the climate and energy development of other countries in the world show that the Nordic countries are ahead of others to different degrees. Among them, Denmark is particularly noticeable for its successful experience. The “Danish Green Development Model”aiming at “zero-carbon” has become the most successful laboratory for the world in searching for solutions to energy supply and safety, evidence that as long as the mankind finds the right development path, it is possible to completely break the energy bottleneck constraining the social economic development. Moreover, the best practices of the “Danish Green Development Model”offers valuable lessons for the ongoing efforts for sustainable urbanization and eco-civilization construction in China.

The genesis and formation of “Danish Green Development Model”

Before the 1970s, 93% of Denmark’s energy consumption relied on import. But the 1st world oil crisis that broke out in 1973 pushed up oil price by 3-4 folds. The 2nd world oil crisis in 1979 further increased Denmark’s international income deficit. After the two heavy hits by the crisis, Denmark began to change the traditional energy pattern that heavily relied on oil imports, but to shift from “reliance” to “self-reliance”.

The result: From the 1980s to today, Denmark’s economy has accumulatively grown by 78%, while the energy consumption aggregation increased by zero, and the CO2 emission dropped by 13%, successfully decoupling economic growth from energy consumption, which is strong evidence that GDP growth and higher living standard do not necessarily equal to higher energy consumption. Denmark has now become a net exporter of oil and natural gas. In the field of renewable energy sources exploitation and utilization, especially the wind power and biomass energy cogeneration application, it takes the leading position in the EU member states. The Danish various indicators in the aspects of energy supply and greenhouse gas reduction are generally superior to other developed countries due to widely use energy-saving technology and energetically developed renewable energy industry. Now, the Danish energy self-sufficiency rate is 156%, compared with 18% and 71% in the Japan and The US respectively; Denmark’s per capita energy consumption is 3.6 tons oil equivalent, compared with 4 tons and 7.7 tons for Japan and the US respectively; Denmark’s per capita greenhouse gas emissions is 10.4 tons, compared with 9.4 tons and 19.7 tons in Japan and the US respectively. On this basis, Denmark sets a new goal; building a nuclear energy free energy system that completely independent from fossil fuel, which is known as “the second energy revolution in Denmark”.  While the goal set by EU to use renewable energy sources by 2020 is 20% of the total, Denmark has already achieved this goal in 2011, and plans to enhance this ratio to 35% in 2020, making wind power generation account for 50% of total electricity consumption in the whole country(21% for now). The percentage of Danish green technology and product export volume in their total export volume rank first among15 EU green tech exporting countries.  Now most reference frame in EU`s energy policy, can be traced back to Denmark.

Five key elements contributing to the success of “Danish Green Development Model”

The successful experiences by Danes in building a “Green Laboratory” for mankind and formulating the sustainable development model can be summed up in the following five elements.

1. Policy-driven

The Danish government prioritizes low-carbon economy as a national strategy and developed an energy strategy tailor-made for the country. Aware of the importance of a national and powerful organization that taking the lead, the government set up Danish Energy Agency in 1976 to solve the problems of energy security. Later, the Agency on the level of national interests mobilized resources from different industries and organizations and collectively designed the national energy development strategy. It also supervised the implementation of this strategy, while shifting the focus from energy to also covering domestic energy production, supply and distribution, as well as energy saving. Since the first day of establishment, the Agency stressed the importance of energy saving and proactively explore the utilization of different renewable energy, in other words, promoting both “reducing consumption” and “opening new sources”. Following this principle, the government made great efforts in developing high-quality resources, guiding the energy consumption pattern, and adjusting the structure. Particularly, the government listened to the voice from the people and gave up the plan of nuclear development that was previously on the agenda. Instead, taking a long-term perspective, it promptly launched the new energy policy that encouraged renewable resources such as wind power and bio mass. Soon after the country successfully realized energy structure upgrading and decoupling the economic development from energy consumption and carbon emission, the Danish government set up an ad hoc organization, the Danish Commission on Climate Change Policy, which designed the overall picture for the country to end the reliance on fossil fuel and to build non-fossil fuel energy system, and also set up the roadmap towards this goal.

The Danish government has adopted a series of policies and measures to promote zero-carbon economy, such as fiscal subsidies and price incentives that encourages the entering-into-market of renewable energy, more specifically the preferential price for green consumption of electricity and offshore wind power, andfiscal subsidies for biomass power generation. Denmark adopted the fixed wind power price to ensure the wind energy investors’ profits by giving them preferential price on the power grid and adding a premium by using government subsidies, so that the price that customers paid are fixed. Moreover, Danish government introduced the “energy-saving account”mechanism into the building industry. To explain, the building owner pays a fund to the account every year. The amount of money was divided into several ranks according to the product that building efficiency standard multiply by heating area. There is no need to pay fund if reach the supreme grade. The buildings after energy efficiencyreconstruction can be ranked afresh as a basis for reduction or exemption from the disbursement of funds to energy-saving account.

2. Legislation Support

In the process that Denmark developed the sustainable development, its government played a very important role, which was accomplished mainly through legislation, or more specifically, economic regulation and tax policy, making Denmark the first EU country really realized green tax revolution. Denmark gradually formed an energy system of environmental tax with energy taxes as the core, including 16 types of taxes such as water, garbage, waste and plastic bags, and specific measures of energy taxes including increasing the existing carbon dioxide tax since 2008 and starting implement the new standard of nitric oxide tax since 2010.

Consumption of fossil fuel is charged the highest tax rate in Denmark. For example, 57% of the electricity fee is tax. If the user does not take any energy-saving measures, he or she has to pay even higher costs. Take the car purchase as another example. Car buyers need to pay value-added tax and license registration fee, which jointly account for about 200% of the car price. This is why the car price in Denmark doubles that in other EU countries. As a part of the energy tax, Denmark raises the CO2 taxrate in 2008 and started to implement even stricter nitrogen oxide tax rate in 2010. On the other hand, the government offered tax deduction to climate and energy industries and energy-saving behaviors. For instance, to encourage investment in wind power, the government levied no income tax on wind power generation from early 1980s to mid-1990s. In the transportation sector, electrical cars are also free of purchase tax, and the goal has been set up to increase the percentage of bio fuel to 10% of all fuels consumed by the transportation industry by 2020, as required by EU. Such tax policies serve as effective guides that encourage people to choose energies with lower costs and lower pollution.

Noticeably, the government also established rules and preferential policies that ensure the road safety of bicycle riders and facilitate the transfer between bicycles and public transportation. As a result, bicycle has become the most preferred transportation means for the Danish in their daily life, from the royal family and high-level government officials to the ordinary people. Today, there are more than 4.25 million bicycles in this country of 5.5 million-population, or 0.83 per capita on average (vs. 0.32 in China).  Denmark is thus a real “kingdom of bicycles”.

3. Public-Private Partnership (PPP)

Denmark’s green development strategy is built on the basis of the public-private partnership. By combining the top-down policies and bottom-up solutions in the development of national and regional large-size green projects, PPP can effectively facilitate the leading enterprises, investors and public organizations to play up their differentstrengths and complement each other in order to more efficiently achieve public welfare objectives.ProjectZero, a pilot zero-carbon project implemented in Sonderborg in Southern Denmark is anexemplaryPPP case. (More details in the appendix: About ProjectZero.)

4. Technological Innovation

Denmark is a small country with limited resources, and is heavily impacted by the climate change. Therefore theDanish government and citizens maintain a sense of crisis, regarding energy efficiency and renewable energy technological innovation as the essential driving force behind the national development. On the other hand, the rising concern over global warming and climate change drives the business and academic sectors to develop new technologies and also provides business opportunities. Energy efficiency improvement and renewable energy technologies have become the most effective measures to reduce the greenhouse gas. In recent years, energy technology has been regarded as a priority area that the government R&D funding went into. The government also released “Energy Technology R&D and Demonstration Plan” to ensure fast increase in the investment into energy technologies, which aims at helping the high-cost renewable energy technology enter the market. In addition, the Danish Green Development Model has motivated all social forces. Guided by the government’s legislation and tax policies, the new energy policy has always emphasized the importance of sufficient investment into the energy sector. This is joined by the efforts from industrial companies, which have invested considerable capitals and human resources in technological innovation and thus gave birth to a massive green industry. After years of endeavor, Denmark has mastered the most advanced energy-saving and renewable energy technologies that can reduce greenhouse gas and has thus become a global leader in the climate and energy industry. Denmark is also the No. 1 exporter of green technologies among all EU countries. In short, Denmark’s technological innovation focuses on “energy-saving” and “developing new energies”:

“Energy Saving”:Promote district heating and develop the building efficiency technologies. Located in North Europe, Denmark has a long heating season. In extreme cases, some buildings use heating in all seasons throughout the year. To deal with such needs, Denmark actively develops building efficiency technologies, characterized by CHP and centralized heating (also known as “district heating”). Today, more than 60% of the buildings in Denmark have adopted centralized heating. By using the distributed energy technology, Denmark heavily adopts renewable energy technology to implement centralized heating, including methane centralized heating, straw and mixed-burning centralized heating. Today, renewable energy has become the single largest source for heating in Danish, higher than natural gas or coal.

As for the low-carbon building, Denmark established strict building standards and promoted energy-saving building. The major measures of Danish building energy conservation are as follows: Requiring real estate developers toput up energy-efficient building signs; classifying the buildings based on their energy efficiency level andadministrating them accordingly, while users are able to make choice according to their needs; simplifyingthe energy-efficiency inspection method; stressing and monitoring the heating preservation effects of doors, windows and walls, so that real estate developers cannot delivery low-quality buildings; offering subsidies to existing building energy renovation projects, such as window replacement andheat preservation of the outer wall. The Danish government greatly decreased building energy consumption by popularizing building energy-saving technologies and implementing classified administration, thus significantly cutting energy consumption. Compared with 1972, Denmark's heating space has increased by 50%, while the relative energy consumption has dropped by 20%, equivalentto a decrease by 70% per unit. 

Danfoss, the global leader in district heating and low-carbon building, developed itself in this process. Founded in 1933 in Sonderborg of Southern Denmark, Danfoss has grown into one of the largest industrial companies in Denmark, with factories and branches all over the world, covering businesses scopes including heating, ventilation and air conditioning (HVAC), building efficiency, motor drives, and new energy technologies such as solar and wind power. Danfoss has helped to greatly improve the life comfort and boosted the development of climate and energy industry. As a representative of the innovation-based companies, Danfoss has played a significantly positive role in the process of Denmark’s green development.

“Developing new energies”:Actively develop renewable energies, leading the world in wind power technology. Starting from 1980, Denmark began to leverage its natural resource advantages to invest heavily into the development of renewable energy, especially wind and bio mass. Today, more than 60% of the wind turbines that have been accumulatively installed in the world are produced by Denmark, accounting for nearly 70% of all the wind turbine trade in the world. Denmark made great efforts in developing distributed energy and CHP and district heating by using bio mass energies. Power generated by renewable energy accounted for 30% of all the power generated in Denmark in 2005, five years ahead of EU’s goal that aims to hit 29% by 2010.

In addition, Denmark drives EU to accelerate the pace of offshore wind power development, trying to transmit offshore wind power to Europe by connecting to the power grid in North Europe through Germany and Poland. EU has approved this plan and made it a demonstration offshore wind power project of EU. Denmark has thus raised the current goal of 300,000 kWh offshore wind power by 2020 to 3 million kwh, and has started to supply wind power to power grid in North Europe on a large scale.

Today, Vestas and DONG Energy are one of the few companies in the world that have really mastered the offshore wind power equipment manufacturing and have real-world operation experiences. They started cooperation in the offshore wind power field in Zealand of Denmark, for which Vestas supplied low-cost offshore wind turbines. After many years of practices, Denmark has made remarkable progress in offshore wind power equipment manufacturing and real-world operation and became a leader in theworld.

5. Education as the Cornerstone

The “zero-carbon” transition in Denmark, like its transition from an agriculture-oriented country to a modernized industrial country that took place more than a century ago, is based on the unique lifetime grass root “civil education”offered to all citizens in the country. By creating commonmental “positive energy” and thus realizing physical“positive energy”, Denmark successfully completed the “Green Upgrading” characterized by a more people-centric,nature-respecting development model in a virtuous cycle. Since the two international energy crises broke out in 1970s-1980s, the Danish people constantly reflected on the lessons they had learnt, from anxiety over the national energy security, to consideration of sustainable development and human being’s future living environment, and further to caring about a wider range of issues including the natural environment, economic growth, fiscal distribution, and social tax structure. Based on this, Denmark’s green development strategy came into shape. A detailed roadmap with magnificentvision has thus been designed and implemented in civil education, and finally become a part of the lifestyle and mindset of the Danish.

Conclusion and Suggestion

In the past 40 years, through key elements including policy-driven approach, legislation support, public-private partnership, technological innovation and education as the cornerstone, Denmark followed the principle of emphasizing both “energy saving” and “developing new resources” and successfully devised and implemented a set of complete energy development and energy security strategy and measures. It thus built a balanced and stable triangle structure among wealth creation, sustainable development and energy supply assurance in the framework of technological innovation.  The result is harmonious development among the society, the mankind and the nature, and a steady progress towards the goal of building a “zero-carbon” city by 2050.

Denmark is a small Nordic country, which is very different from the situation in China. However, its size and development level is on a par with a number of Chinese cities. In addition, the traditional energy structure of Denmark 40 years ago is very similar to China’s today, i.e., heavily relying on coal and gas. Besides, the principle of emphasizing both “energy saving” and “developing new resources” as the solution to the energy issue is in fact the same as the traditional business wisdom in China. As a consequence, the Danish national culture of saving that got enhanced in this process of the green development share a lot in common with the traditional diligence and frugality of the Chinese people. In this sense, Denmark’s transformation in the past several decades are relevant to some cities and towns in China that are heading towards urbanization and can serve as good reference.

We therefore make the following suggestions: (1) Build pilot districts in cities and towns where the condition is mature, starting from the more approachable areas and the smaller areas. By learning from the basic elements of the Danish Green Development Model, offer preferential tax policies and supports, build a complete set of low-carbon index system that fits the real-world condition of China, and implement to a larger region, such as cities in the relatively more developed coastal areas. (2) Conduct a general overview and analysis of the existing low-carbon cities and areas, find out the more successful cases and give greater support to them, so as to expand them to a larger size. For example, the urban heating system optimization project in Anshan, which is in cooperation with Denmark, is effectively reducing energy consumption while utilizing the surplus heat from Anshan Steel Company to supply hot water and heating to residential buildings.  In short, a reasonable utilization of the best practices of Denmark by considering the situation in China will help us to accelerate the face of building an eco-friendly and energy-saving society, and finally achieving a “beautiful China” where the mankind, the nature and the society are in ultimate harmony.

 

Appendix: ProjectZero in Sonderborg, Denmark

The case of ProjectZero, successfully implemented in Sonderborg in southern Denmark is a good example to tell how the Danish Green Development Model is practiced and implemented on a micro level.

Sonderborg has a population of 80,000 people and territory of 500 square km. Starting from 2007, the city began to implement ProjectZero, aiming at making Sonderborg a zero carbon city by 2029. Today, Sonderborg is already a famous pilot green city in Europe. It won the Sustainable Energy Europe Award from the EU in 2010, and is one of the 18 partner cities in the Clinton Climate Positive Development Project. During his visit to Sonderborg in 2012, former US president Bill Clinton said, “ProjectZero is a good model to the rest of the world”. Today, Sonderborg has become sister cities with Baoding of China, and they have started cooperation in district heating and building efficiency.

The birth of ProjectZero could be traced back to 2004, when Jorgen Clausen, then Danfoss President, said, “We have to think ahead and focus on the future. We have to fully consider the sustainability of our city and make it world-class.” Based on his idea, Think Tank Future planned and devised the road of ProjectZero, setting the goal of making the city carbon neutral by 2029, which is 21 years ahead of Denmark’s national goal in 2050. Think Tank Future is composed of more than 80 partners, including the government, business sector and energy companies, and has got funding from five big funds, including City of Sonderborg, Danfoss and DONG Energy. The project finally rolled out in 2007. It is a model of

In the beginning, the carbon emission per resident in Sonderborg is 12 tons/year, about the same as the national average. ProjectZero sets the goal to reduce urban energy consumption by 38% compare with 2007, and realize zero carbon by utilizing renewable energy. This will be approached mainly through three measures: (1) Massive focus on smart use of energy. Lowering consumption by energy efficiency improvement is estimated to reduce energy consumption by 40% compared to baseline 2007. (2) Conversion to multiple renewables including efficient use of the areas manure and waste from farming, geothermal heat, wind, solar heat and photovoltaic. (3) Creation of the world first intelligent, dynamic energy system in close cooperation with SE (Utility Company) and other stakeholders.

This project applies to the area’s 18,600 home owners, who will now gain inspiration and knowledge about energy renovations that both ensure future housing values and reduce energy consumption. 1,200 homeowners will be offered free energy advice. More than 600 completed reviews have already sparked a growing demand for contractors who can implement energy renovations.

Another great initiative of ProjectZero is to promote and develop “Energy+ House”, where the energy produced by the house is greater than the energy consumed. The “Energy+ House” mainly relies on solar power for electricity and heating with solar panels installed on the roof, combined by optimized insulation layer that prevent heat from leaking into the outdoor air, so as to reduce energy consumption as much as possible. In Sonderborg, such an “Energy+ House” with solar panels can generate 6000 kWh of power per year on average.

According to the roadmap of ProjectZero, enterprises in Sonderborg need to cut energy consumption by 5% per year by 2015, and gradually phase out fossil fuels. In addition, the area will give strong support to green industries to create new development opportunities. ProjectZero will create at least 5,000 green jobs in the local communities. AaseNyegaard, Mayor of Sonderborg, said, “ProjectZero can realize energy self-supply and zero carbon, while also build more green job positions by driving the climate and energy industry, to achieve win-win to the benefits of the economy, the society and the environment. “