New report scrutinises the energy sector and illuminates its important contribution to Danish society. Quartz+Co has prepared the report The Historical Transformation of the Danish Energy Industry and Its Significance for Danish Society, published in connection with a conference on the energy industry in Denmark in February, 2015.
The report examines the development of the energy system, its contribution to Danish society, its performance among European peers as well as areas where the Danish energy sector has built unique competences and strong positions.
Over the past 40 years, Denmark has managed to readjust its energy model from being highly dependent on imported oil from the Middle East to being one of the greenest and most efficient energy models in the world. Indeed, the increasing export of made-in-Denmark energy solutions benefits us all. The energy sector’s strategic importance is significant, and its continued development is decisive to Denmark’s competitiveness and societal wealth.
Throughout five chapters, the report outlines the historical development of the Danish energy model, highlighting the most important events that have influenced its current state. In addition, the report examines how the Danish energy model compares to those of our European peers on a number of key parameters. The overall conclusion is that Denmark has managed to create one of the most efficient energy systems in Europe with high energy security and low energy intensity. We are also among the countries that have progressed the most when it comes to the transition towards green energy, in fact the share of energy produced from renewable sources in Denmark is more than twice the EU average.
The economic contribution of the energy sector to the Danish economy is also substantial. The entire Danish energy industry, encompassing the energy sector as well as technology and service companies, employs around 56,000 people and accounts for exports of around 125 billion Danish kroner.
Challenges in sight
Denmark has built significant positions of strength within key areas of the energy sector. Among these are oil and gas, wind energy and district heating as well as energy optimisation. Add to these upcoming areas such as smart grid and bio energy, where Danish research is among the best in the world, but where the potential has yet to fully materialise.
Even though Denmark has indeed come far in transforming its energy model into a green and competitive system, there are still challenges in sight. The ambitions for the next phase are equally high, but so are the challenges related to achieving them. We have to further reduce CO2 emissions while maintaining competitive prices. Renewable energy will form the core in the future energy system, and this will not only change how we produce energy, but also how the rest of the system will function. Simultaneously, the income from the energy sector will take a notable dive as the oil and gas production in the North Sea decreases.
The most important components to overcome these challenges and make the next chapters of the energy saga a success story are: to keep bringing down the costs, to find ways to attract the capital needed to invest in a continued transformation and to fully exploit the competences we have created to further strengthen the exports of Danish-made energy solutions.