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Ladies and Gentlemen, Prime Minister Kubilius,
Thank you for this opportunity to share with you my thoughts on the climate and energy issues confronting our societies.
Modern societies are built on energy. Our most basic functions in society depend on energy. Without energy no heating, no transportation, no production. Without energy no progress, no growth, no prosperity.
Also, the societies we live in today are built on a specific type of energy: fossil fuels. And this presents, as we all know, huge challenges. Challenges which will only be intensified in the future.
Firstly, demand for energy will increase rapidly. The main reason being the growing economies in Asia and the Americas where rapid growth in the economy is coupled with millions and millions of citizens lifted out of poverty and into a modern market economy with prosperity - and rapidly increased energy consumption. That is a reality.
We welcome this development which creates huge opportunities both in the emerging economies and in the rest of the world.
At the same time, we must be aware that as we move ahead, we have to find ways to grow our economies in ways that do not require increased consumption of fossil fuel - the reserves of which are shrinking. This is the challenge. And this is the opportunity.
This is most evident in the case of oil. Already production from existing facilities is decreasing. And expanding production capacity will take large investments.
In short, we must foresee rising prices on energy. And a more narrow supply base compared with today.
With the 2008 collapse in the world economy and our efforts to secure recovery, we can no longer afford to pay more on the energy bill than we need to.
Producing more with less is a key objective and we need to concentrate on the opportunities inherent in smarter ways of producing and consuming energy.
Secondly, we can’t afford that increasing demand for energy speeds up climate change. Scientific evidence of man made global warming and increase in extreme weather conditions are piling up and the dire consequences are already being felt in many places around the globe.
Often, the adverse effects hid hardest on those least capable to cope – and least responsible for the emissions.
And thirdly, it is inconsistent with our national interests to depend for our welfare on exports of oil and gas from few and often faraway producers – and to transfer to them huge sums of money every year – money that we badly need to growth and employment in our own economies.
In short, we need to take action with a view to preparing economies and our enterprises for the next “oil-price-shock” and ensure our competitiveness in the future world economy.
To provide a solid basis to meet these challenges, the Danish Government back in 2008 established the Danish Commission on Climate Change Policy. Ten independent experts have worked intensively for more than two years to solve how we can free ourselves of fossil fuels as well as further reduce emissions of carbon dioxide.
We asked the Commission to go all the way, preparing a blue print for a complete phasing out of fossil fuel from our economy.
I know, of course, that this cannot be achieved tomorrow. And I know that if this is to be achieved with continued growth and welfare development, it will take decades with intelligent steering and incentives. Still, we need to get started.
As you may know the Commission delivered its report just yesterday. Chairman Katherine Richardson is present here today, and I would like to say to you that you have done a magnificent job.
The commission has mapped a way towards an energy system fully independent of fossil fuels. Making the vision of independence of fossil fuels not an abstract scenario but a very possible solution to our twofold challenge: Ensuring energy security and fighting climate change.
My Government will study the recommendations of the Commission very closely as we work ourselves into the complex green issues. We will present a roadmap setting a date for freeing ourselves from fossil fuels. And we will devise a concrete strategy in order to reach this goal. I believe it will be among the first roadmaps in the world on how to become fully independent of fossil fuels.
This is by no means a work over and I have no illusion that achieving this is “beyond politics”. Rather to the contrary: A planned for transition like this will touch every part of society and every corner of politics.
We are facing tough choices, painful priorities and difficult decisions. Let my highlight a few examples:
• In houses and homes, energy consumption must be reduced by 50 percent compared with today. That is a challenge.
• In electrical devices (ovens, dishwashers, computers etc) energy consumption must be reduced by 50 percent compared with today.
• In transport we need to drive cars using only one third of the energy used today.
It is possible to achieve it. And at the same time we must balance a number of priorities: employment, sound public finances and competitiveness.
If we look back on the Danish experience so far we will see what has to be done.
Up to the crisis in 2008 our economy grew by almost 80 percent during the last three decades. But energy consumption remained broadly speaking unchanged. The result is an economy which is among the most energy efficient in the world.
At the same time we have gradually built up our capacity in green energy. App. 20 percent of our electricity is generated by wind power. A total of 17 percent of energy consumption is covered by renewables. And we aim to be one of the leading hubs for electrical cars in the years to come.
In short the Danish example shows that growth and prosperity is possible without increasing energy consumption. And it shows that the future of modern energy is green.
Basically, it is within this paradigm that our green transformation must take place.
The first pillar is to continue efforts to improve energy efficiency even more. We have already decoupled economic growth and energy consumption. But in the years to come we will aim at lowering energy consumption in real terms – using less energy tomorrow than today.
In short, saving energy is good business. For citizens, companies and the society. Improving energy efficiency will reduce vulnerability to rising energy prices. And the more energy we save, the easier and cheaper it will be to build a new green energy system.
Green energy is the second pillar. We must expand the use of green energy on a massive scale - making it a cornerstone of the new green economy.
In many respects the technology is already there. The challenge is to make green energy the every day choice of consumers and business. In order to do this, green technologies must be accessible and “ready to use”.
This is why the Danish Government has chosen to exempt electrical cars from car tax until 2015. This will help make electrical cars an attractive and competitive alternative to fossil fuel cars over the years.
A number of strong and innovative Danish companies have profited from our energy policy over the last decade and some have become world leading within their field of activity. And as they have profited, so have we in the Danish society.
Some of those entrepreneurs are here to day, and it is my hope, that as I speak in ten years from now on a different venue but on a similar occasion more will be sitting in the hall, representing up starts we don’t even fancy today. And who knows? Maybe some will be world leading in their field of activity!
The green transformation in Denmark cannot stand alone. The Danish Government will actively and persistently try to expand green thinking and green economy wherever we see fit.
This is especially relevant in relation to the EU. As you are well aware, EU has taken the international lead by declaring it self willing to cut carbon dioxide emissions by 20 percent before 2020. If certain conditions are met, emissions will be cut by 30 percent.
The Danish Government believe that time has come to further increase the green commitment of the EU. Therefore we believe that we should set an EU-target of reducing carbon dioxide emissions by 30 percent in 2020 – unilaterally.
Denmark consequently supports that the EU goes to a 30 per cent reduction target on the conditions that it does not harm competitiveness and employment and that we reach a fair burden sharing between all EU member states.
The Danish Government will use all its persuasive powers in order to convince its partners within EU to support this. We need to solve these issues on an EU-level.
I believe that such an initiative will send a very strong signal to our global partners that EU is more committed than ever to fight climate change
Furthermore, by raising our climate goals, we reaffirm our commitment to creating a low carbon economy. Setting such an ambitious goal will help stimulate development of new technologies and markets for green tech.
The challenges of climate change and a low carbon economy cannot be met by Denmark alone. The challenges cannot be met by Europe alone. We need to build up global capacity in green problem solving and solutions.
Right now we are witnessing a massive movement towards loosening the ties of fossil fuels. Societies across the world seek new ways to make their economies greener. And they do so simultaneously.
This entails a huge potential for concrete and “hands on”-oriented dialogue focused on how to make our economies even greener.
Therefore my government has decided that it will seek to establish a forum for green growth.
The Forum should be a leading venue for the development and discussion of green strategies. It should provide for cross-cutting discussions related to business models, technology, strategy and regulation. And it should be aimed at global experts and decisionmakers from both the public and the private sector, regulators, business and investors.
The first meeting will take place in second half of 2011. I hope you will all join!
This is also why I find this conference hosted by Mandag Morgen particularly helpful. It aims at bringing together possible solutions to creating a green economy with decisionmakers and experts. This is exactly what we need if we are to increase our capacity in green problem solving!
Thank you for inviting me to open this important gathering and thank you to all of you for your attention.
We need to take action in order to create a low carbon economy. Your presence and this conference will help us getting it done.