With Norway and Sweden having had their time in the spotlight, this week it was Denmark’s turn to see whether it could deliver on climate policy. Generally the Danish news seems better, with the country on track to meet its 2025 target, albeit with some questions around the amount of carbon stored in its soil. But the 2030 target will be a stretch, with much hanging on whether politicians can forge an agreement around policies that drive down agricultural emissions.
In Sweden, reality is becoming a little clearer. This week the Minister for Energy, Business and Industry spoke ominously about the amount of electricity that would be available to industry in 2030.
Recently we’ve highlighted the challenging situation for many start-ups, with new funding being very difficult to obtain. Now we report that CAKE, a maker of e-bikes has been sold in bankruptcy, and Re:NewCell is following it there, despite having had a strong investor list.
In a final nod to reality, we observe that the IEA reported global emissions hit a record high in 2023. Sadly, the curve is not bending fast enough.
And with that, I wish you a nice weekend ahead.
Sean Williams, Head of Mundus Green Impact
Climate discussions in Denmark are reaching a critical point, with a focus on the nation's ability to meet its ambitious CO2 emission reduction targets: a 50-54% cut by 2025 and a 70% reduction by 2030, as per the Climate Act. The Climate Council's latest annual status report brings a cautiously optimistic view for the 2025 target, suggesting the lower threshold is within reach. However, achieving the 2030 goal poses a greater challenge, with current government plans barely aligning with the necessary emission reductions.
The report emphasises the urgency of addressing agricultural regulations and curbing climate-damaging consumption patterns, particularly in food, highlighting the potential for a CO2 tax on agriculture to impact competitiveness negatively. The Climate Council did not include the report from an expert group, which last week came up with three different models for introducing a climate tax in agriculture. Politiken argues that it is a failure of politics to produce a plan, which needs to be agreed in the government's 'Green Tripartite', with several parties, including Denmark's Nature Conservation Association and Agriculture and Food Council, trying to reach an agreement.
To navigate challenges, the Climate Council has put forward 7 key recommendations:
Reevaluate the CO2 tax for industry promptly.
Implement a greenhouse gas tax to drive the agricultural sector's green transition.
Increase the diesel tax to align with Germany's, suggesting a rise to 90 øre per litre from the proposed 50 øre.
Amplify global climate efforts.
Initiate actions against climate-damaging consumption, starting with food.
Develop a comprehensive biomass strategy for a more accurate representation of its climate impact.
Expand the development of green electricity through solar and wind energy, alongside enhancing flexibility, for instance, through storage solutions.
Sweden’s energy policy bill will be put to its parliament on March 12, but whether it will receive broad political support is uncertain. The opposition has called for clear targets for 2030, which the Energy Minister says she has listened to. But, she shies away from being clear about the targets as “it is difficult to know what one dares to promise.” Pointing at the many large industrial investments in the pipeline Busch offers words that must send a chill up business’s spine: "We will have a very tough discussion about what we will have to offer business in 2030, regardless of whether we have goals for 2030 or not.”
Busch also addressed NATO. "With the offshore wind power, naturally there will be much greater defence interests and thus also a much greater risk that the Defense will say no."
EV manufacturer Polestar has secured USD 950 million (approximately SEK 10 billion) in new financing through a three-year loan from twelve international banks, including BNP Paribas, Natixis, Standard Chartered, BBVA, HSBC, and SPDB. While the amount falls short of the initially targeted USD 1.3 billion, the funding will help close the company’s financial gap. Polestar, is currently in an intense development phase with two new models launching this year, has faced losses, revised sales forecasts, and a 70% stock value decline over the past year. The loan aims to support Polestar during its expansion, with the company expecting to break even in cash flow by next year.