The cement giant Aalborg Portland is Italian-owned. An Irish company owns Holmegaard’s glass factory. Four masonry in South Jutland, Funen, Helsinge and Thy have been acquired by the Austrian group Wienerberger.
What is the common thread between these companies? Enormous CO2 emissions – among the largest in Denmark. But they are no irregularities.
About 62 percent of the industry’s CO2 pollution in Denmark comes from foreign-owned companies whose emissions are covered by free EU quotas, according to a DR report showing figures from the EU Commission and the Danish Energy Agency.
For one of the EU’s most climate – conscious countries, it is a stain on the green agenda. So what is Denmark’s move?
Achilles Heel for Danish climate goals
The government is under pressure to raise the tax on CO2 emissions. Conservatives, Liberals and Radicals, as well as the Climate Council and the Economic Council, have expressed concern that private companies are getting away with polluting at low cost.
Jakob Roland Munch, professor of economics at the University of Copenhagen, supports the proposal – but predicts that it could harm business interests.
“For foreign-owned companies, it will probably be easier to move their production out of Denmark if a higher CO2 tax is introduced,” he said.
Henrik Dietrichsen is CEO of Egernsund Wienerberger’s branch in the Nordic region. Wienerberger is one of Denmark’s largest polluters and produced 37,000 tonnes of CO2 last year.
Dietrichsen reiterated Munch’s concerns about future viability by operating in Denmark under higher taxation. “If there is a CO2 tax in Denmark, as proposed, and not in other countries, then it will naturally have consequences for jobs.”
“The polluter must pay”
In the autumn, an expert group will present the first proposal for a green tax reform to raise the CO2 tax in Denmark and cover the industries that are exempt today.
Today, companies pay 180 kroner per. Tons of CO2 – but the largest CO2 emitters such as Wienerberger are exempt from Danish CO2 tax. The proposed increase will result in a tonne of greenhouse gas costing DKK 1,500.
“The polluter must pay. That’s the principle we think is healthy, ”Munch said.
The Minister of Taxation, Morten Bødskov – even though he supports the increase – has been wise about hard numbers. “How much the increase will be exactly is a question we have left to an expert group,” he said.
Grants for green alternatives
In the meantime, DKK 6 billion has been set aside to support the companies’ green transition if they choose to go green instead of going home.
“We want to help the industry get on the green track and avoid being taxed as a result of too many CO2 emissions,” said Bødskov.
Several of Denmark’s neighbors, such as Germany, Sweden and Norway, have already introduced a higher tax on CO2 or plan to do so.
While Denmark’s current tax per. Ton is 180 kroner, Germany’s 450 and Sweden’s 85, while Norway has raised taxes to 1,500, according to Mikael Skou Andersen from Aarhus University.
For once, it seems that it is time for Denmark to follow suit instead of leading the accusation on the climate agenda.
“It will be easier to introduce a higher CO2 tax in Denmark when other countries do the same. We do not have to worry so much about production moving out, ”Munch assured.
Source: The Nordic Page