Denmark’s new government will reduce the amount of money it spends on “green” energy by 67 percent, according to a Sunday New York Times article.
Denmark and other Nordic countries have long been viewed as environmental utopias, but the government plans to reduce spending on green energy to save money and lower the country’s electricity rates, which are among the world’s highest.
Denmark’s government will have a higher than expected budget deficit of 3.3 percent in 2015, triggering the cuts to green energy. This deficit is higher than the 3.0 percent allowed for member countries of the European Union. Denmark’s new cuts will reduce green energy spending from $55 million to $18 million. The New York Times claims that Denmark’s spending reduction will cause job losses.
Denmark currently has some of the highest electricity prices in the world at 41 cents per kWh. Electricity in Denmark is almost four times more expensive than in the United States. Impoverished citizens in the lowest Danish income brackets spend about 8.9 percent of their total budget on electricity. The poorest citizens in neighboring Sweden, which doesn’t subsidize green energy to the same extent, spend only 3.6 percent of their household budget on electricity. The lowest income brackets in the United States spend a mere 2.9 percent of their household budget on electricity.
The high price of electricity in Denmark means many citizens can’t afford the electricity required to meet day to day living requirements. Raising electricity prices has a massively regressive impact, harming low-income individuals far more than wealthy ones. Poorer, working-class people tend to spend a higher proportion of their income on basic needs like electricity and fuel than the wealth do.
Denmark planned to stop burning all coal, oil and natural gas by 2050, and heavily invested in the wind power industry. Denmark has an incredibly windy climate and began subsidizing wind power heavily in 1973 to reduce dependence on imported oil. Despite more than 40 years of investment and research, Denmark gets a mere 39 percent of its energy from wind power on extremely windy days. Other sources of green energy provide a very low percentage of Denmark’s electricity.
Denmark has two major geothermal power plants, but neither produces any electricity.
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