The Nexus between Water, Energy and Climate: Shaping Long Term Policy to Create Jobs and Business Success for a Resource Efficient Economy

The Royal Danish Embassy and the Environmental and Energy Study Institute (EESI) held a Congressional forum focused on how Denmark, which currently holds the Presidency of the European Union (EU), is meeting the economic, environmental, and energy challenges of the 21st Century. Denmark’s Minister for Trade and Investment, Pia Olsen Dyhr, was the keynote speaker for the event. Minister Dyhr focused on the nexus of energy, water and climate. These are issues important in the Congressional discussion underway on the Farm Bill and other energy and environmental legislation. Moreover, trade, investment, and international competitiveness are major concerns of Congress and the country overall, and Minister Dyhr made the case for long-term, stable investment as the gateway to job creation and economic growth.

The role of stable, long-term policy has been essential in providing the certainty and “rules of the road” that businesses everywhere say are critical to their economic well-being. Without this, many companies lack the market certainty that is crucial to how they make their investment decisions. In a world of heightened global competitiveness and fast-moving technology changes, Denmark has positioned itself as a global energy technology leader. It is a country moving quickly to a low-carbon and highly efficient economy, and a country with a very robust economy and high standard of living. The story of how this can be accomplished was discussed by Minister Dyhr and two senior executives of major cutting-edge technology companies that also have deep involvement in the United States.

Highlights:

• Denmark, a world leader in transitioning to sustainable, clean energy, currently uses no foreign fossil fuels for its energy, and the Danish government has set the goal of being completely independent of fossil fuels by 2050. The United States can learn much from Denmark about “best practices” and how to transition to a cleaner economy.
• According to Danish Minister for Trade and Investment Pia Olsen Dyhr, the Danish economy has grown 78 percent since the seventies, comparable to other developed countries, while its energy consumption has remained flat.
• Climate, energy and water are interrelated, and should be tackled together. Indeed, according to Jes Munk Hansen, the CEO of Grundfos North America, 20 percent of US energy use goes to pumping water, while 200 billion gallons of water are used to cool coal power plants each day.
• Strong business-government relationships benefit society. After the oil crisis during the 1970’s, Denmark enacted clear policies to reduce dependence on foreign oil. Today, Denmark obtains 22 percent of its energy from wind, is energy independent and a net energy exporter, and has globally competitive businesses.
• Denmark used North Sea oil as a bridge to energy independence. The country heavily relies on local, district power plants, which are more than 80 percent energy efficient (compared to a maximum energy efficiency of 40 percent at U.S. coal fired power plants).
• Energy efficiency and environmental stewardship can go hand-in-hand with high standards of living. Public transit, bicycles, taxes on cars, and home and building energy efficiency targets help the average Dane consume half as much energy as the average American.
• Reliable, long-term, fair rules and targets are essential. Businesses will work to meet ambitious and forward-thinking targets. The resulting innovation benefits society, while keeping companies at the cutting edge and globally competitive. Both Grunfos and Novazyme prefer stable policy and targets to subsidies.
• According to Jes Munk Hansen, CEO of Grundfos North America, as the world population grows, energy demand is expected to increase by 35 percent in the next 25 years. It makes sense for businesses to begin thinking about energy efficiency and climate change effects early: leading in the green revolution can catalyze economic success and change lives for the better while avoiding high future costs.
• Grundfos North America CEO Jes Munk Hansen is a strong proponent of transparent labeling programs, which can educate engineers and consumers about the performance of different technologies, raising awareness for clean technology and driving the deployment of innovative solutions.
• Modern technology can be used to increase system efficiency, and is waiting to be implemented, creating a “win-win-win” for society, the consumer and the environment.
• Example: commercial building water systems tend to use old, inefficient pump technology which runs all of the time. Creating a “smart” system of electronics that sends data back to the equipment can ensure that the pump only runs when it is needed, reducing pump energy use by half.
• Public-private partnerships that link government agencies, university researchers and private companies, or invite private companies to solve specific problems, are valuable tools for generating and implementing new ideas.
• “The goalpost doesn’t move.” Clear, long-term targets and smart regulation encourage innovation and new products, while providing a level playing field.