Energy Strategy 2050 – from coal, oil and gas

The transition to fossil fuel independence will not be free.
It will cost money to convert to more energy efficient
technology and renewable energy. It will require investment
which in the long term will mean lower fuel costs,
but which in the short term will often be more expensive
than the fossil alternatives. In the longer term, transition
will result in an economy less vulnerable to fluctuating
energy prices, and Denmark will make its contribution to
meeting the costs arising from extensive global climate
change. If these benefits are taken into consideration,
the extra costs of the transition to a society without fossil
fuels will overall be modest, although transition will have
to be gradual and over a long time period.
An economically responsible transition is important for
the Danish government. Therefore all the new initiatives
in the government’s strategy are fully financed. Furthermore
the financing has been designed with full respect
for existing economic policies and in a way, which retains
the overall competitiveness and employment of Danish
companies, and which provides new opportunities for
green growth.
The transition to fossil fuel independence
will not be free.
In line with the phasing out of fossil fuels, government
revenues from taxes on fossil fuels will naturally fall as
well. This means that the government’s revenue base will
deteriorate with an unchanged tax system. This in turn
means that there will be a need to gradually introduce
taxes on other energy sources to ensure government
revenues, and thus the basis for continued welfare.
Together with continued taxes on fossil fuels, transition
can be financed while also ensuring the right incentives
to reduce the use of fossil fuels.
In any case, changes in the existing tax system will have
to take full account of the competitiveness of Danish
businesses and the finances of individual households.
There is no benefit in conducting energy and climate
policy at the cost of Danish businesses and Danish jobs.
However, neither is it possible to exempt the business
community entirely from the burden of transition to fossil
fuel independence. The government’s strategy has
established a balance between competitiveness and the
need for a fair distribution of the burden of transition.
Energy Strategy 2050 – from coal, oil and gas to green energy.
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