TCS Daily

Danes Cut Back on Hot Air

By Herbert Inhaber - February 13, 2002 12:00 AM

We think of Denmark as a peaceable land, with lots of windmills dotting the horizon, and greens everywhere. But as far as environmental groups are concerned, there is now something rotten in the kingdom.

A recent news story trumpeted the headline: "Denmark to Slash Environmental Spending." Following a victory by center-right parties in the November elections, cuts in environmental policy-making and aid to developing countries have been instituted.

The government is still socialist by American standards -- the $800 million saved from abolishing a plethora of boards and councils will go to hospitals and to introduce one-year maternity leave, something not found in this country.

But about one in seven civil servants at the environment ministry will lose their jobs. The biggest proportional cuts have come at the Danish National Energy Agency, where about one in three employees will be let go. Environment Minister Hans Christian Schmidt said, "We are not dismissing staff in the environmental ministry because they have been poor workers, but because we think the money is better put to use in other areas."

"We're doing what people have wanted for many years in Danish politics. We have the desire and the will to judge how we will use taxpayers' money in the best way possible," said finance minister Thor Pedersen.

From the American viewpoint, the most curious aspect of Danish energy policy is its reliance on wind energy. About 10% of all electricity in the nation comes from wind, making it the highest proportion in the world. And since Danish windmills were first installed in 1891, shortly after the beginning of commercial electricity, wind is thus the oldest energy system still being subsidized.

However, Louise Guey-Lee of the Energy Information Administration points out that Danish wind energy is highly subsidized. It is difficult to estimate exactly the size of the subsidy, since there are all sorts of cross-subsidies, but it is fair to say that the Danish wind industry would disappear if the subsidies were removed. No word yet if the new government is planning this step.

The Danes have been able to pound their chests with pride at international energy meetings, using the 10% statistic. It even was once mentioned in National Geographic in an article written by Garrison Keillor on the homeland of his ex-wife. He said that the Danes hate nuclear energy and love wind. I pointed out in a letter to the magazine that the Danes were only too glad to import nuclear power from its neighbor, Sweden, when the wind didn't blow.

What the Danes don't mention in these international energy and climate change confabs is that most of the rest of their electricity comes from that old stand-by, that 800-pound gorilla in the room that everyone ignores, coal.

The cuts in Danish foreign aid will also change wind energy in that country. Although much of the public thinks that "development aid" constitutes bundles of cash handed out to foreign potentates, the vast majority is paid to domestic industries, both in the U.S. and Denmark. In the latter case it has funded large wind projects in India and other Third World countries. Those nations would never have bought Danish windmills without Danish cash paying for them. Cuts in foreign aid will slow down future juicy windmill deals.

The Senate Democratic energy bill (and to a somewhat lesser extent, the Bush-supported House-passed bill) relies strongly on an increase in renewables, including wind energy. Moreover, it appears that the Bush administration is going to approve caps (mandatory and voluntary) on some emissions, thus prompting either massive energy use reductions or an even greater shift to alternatives. Given the changes in Denmark -- the greatest proponent of wind energy -- a reasonable person might say that before we rush ahead with energy suppression schemes, we should see how the Danish situation plays out. But Diogenes would have trouble finding a reasonable person in Washington.

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