56 PERSPECTIVES ON BUSINESS AND ECONOMICS | VOL 41 | 2023 energy to meet changing energy demands driven by emerging technologies and greater electrification. The electrification of Denmark Energy production and use are essential for any nation to have a functioning, let alone dynamic, economy. Electricity plays a crucial role in this balance with an interdependency to almost every facet of the national economy. Electricity is needed to pump water; to electrify transportation; to support communications, information technology, and industry; and even to facilitate the operation of oil, natural gas, and biomass electric power generation plants. One of the most effective strategies to reduce greenhouse gas emissions is electrification. Electrification refers to the process of replacing fossil fuel–powered technologies with electricity-powered alternatives, which can be generated from low-emission renewable sources. As Denmark pursues its strategy of greater electrification, electricity consumption is projected to increase significantly in the period up until 2030 (Danish Energy Agency, 2021), and, with that demand, Denmark will need to continue investing in clean sources of electricity production. As of 2020, Denmark produces 103 PJ of electricity, of which 85 PJ, approximately 82%, is from renewable sources. However, Denmark requires more electricity than it produces, which results in a net import of electricity of nearly 25 PJ. The net import brings the percentage of renewable electricity consumed down to 68%. Although this percentage represents a massive improvement over the 1990 and 2000 rates of 5.3% and 15.9%, respectively, there is still room for significant improvement (Danish Energy Agency, 2020a). Denmark plans to meet its future clean electricity needs primarily through wind energy and on an interim basis with bioenergy. Currently, renewable electricity production is driven mainly by bioenergy and wind energy, representing 48.5% and 48.0% of the total production, respectively, with solar contributing the remaining 3.5% (Danish Energy Agency, 2020a). Electricity generated from wind power is intermittent as it relies on variable weather patterns that can lead to times with low electricity output, a result of the wind not blowing. On the other hand, bioenergy, which the country has been using for more than two decades, is readily dispatchable and can serve the crucial role of providing electricity when wind turbines are suffering from intermittency. Together the two forms of generation can readily complement each other. Denmark must continue to invest heavily in clean electric generation with its predominant focus on wind and bioenergy. By doing so, the country can reduce its greenhouse gas emissions while maintaining the requisite electricity supply needed to power a fruitful economy and a healthier society. Demand for biomass and biogas energy A 2017 Danish Council on Climate Change report identified a list of elements that would reduce CO2e, at the same time meeting the future demands for energy and electricity. Although the nation’s long-term strategy is to expand total wind turbine capacity in order to satisfy electricity demand, the report also included the increased development of wood pellet boilers and the integration of biogas in the natural gas grid (Danish Council on Climate Change, 2017). An updated 2020 report detailed plans to use bioenergy as a transitory electricity source while domestic wind capacity is increased to meet total electricity demand. The report notes that biomass electricity production must meet criteria for sustainability. For biomass, this means the carbon emitted from combustion must be less than the carbon absorbed while growing. In addition to electricity production, the report specifically describes the need to increase biogas production to 35 PJ by 2025 in order to replace natural gas use (Danish Council on Climate Change, 2020). Biomass that is used strategically to combat intermittency caused when the wind is not blowing or the sun is not shining will remain a crucial part of the Danish energy strategy for the foreseeable future even as wind turbine capacity is increased (Danish Council on Climate Change, 2020). None- theless, there are concerns about the long-term sustainability of such a high reliance on biomass for electricity production. First, biomass electricity production still requires the combustion of natural material, and the concern is that emissions from combustion may outweigh the carbon absorbed during the growing process. Second, Denmark imports biomatter, which could cause high carbon emissions from transportation. Finally, Denmark’s use of biomass per capita is nearly three times the sustain- able supply of biomass-based energy available globally (Danish Council on Climate Change, 2018). Because global influence plays such a large role in the Danish Climate strategy, the scalability of biomass electricity production becomes doubtful. The next decade of developments in domestic electricity demand will bring into question the viability of bioenergy to meet these changing demands. Bioenergy is certain to play a major role in the Danish energy economy, but it is not a strategy that can be implemented globally.
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