CLIMATE SOLUTIONS DENMARK

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CLIMATE

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Scandinavia’s most important marketplace for clean tech & energy solutions

Copenhagen 25-26 November 2008

COPENHAGEN CLIMATE SOLUTIONSis Scandinavia's largest marketplace for stakeholders within climate change, energy and clean tech. Taking form as a combined conference and exhibition, the event is the ideal place to advance solutions to tackle climate change. While the conference identifies current challenges and opportunities, the exhibition presents state of the art solutions for achieving a low carbon economy.

In 2007,COPENHAGEN CLIMATE SOLUTIONSbrought together more than 600 decision makers from Scandinavia. In 2008, the aim is to gather 1.000 CEOs, environmental managers, politicians, clean tech investors, technical advisors, and buyers and sellers of the leading businesses and industries of Northern Europe.

For further details, please contact Meik Wiking at mwi@mm.dk or +45 3393 9323

www.copenhagenclimatesolutions.com Who will participate?

• CHIEF EXECUTIVESwith an interest in contributing to a low carbon economy, including: managing directors,

environment managers, quality managers, production managers, service managers, development managers, architects, business leaders within the farming industry and other stakeholders within the field of energy efficiency, climate solutions and sustainable development.

• MANUFACTURERS OF CLEAN-TECH SOLUTIONSwithin the field of sustainable energy, construction, transport, water technology, renovation, farming, etc.

• INVESTORS, including representatives from banks and financing corporations, venture and equity funds

• PHDS AND OTHER TOP STUDENTS

• DECISION MAKERSfrom ministries, regions and local governments, including city managers, technical managers and environment managers

• BUSINESS JOURNALISTS AND COMMUNICATION PROFESSIONALS

• ENERGY AND ENVIRONMENT ADVISORS, CONSULTING ENGINEERS AND NGO REPRESENTATIVES

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5

T

he world is currently facing one of its greatest-ever challenges. The effects of climate change will have a dramatic impact on the world and can spark social unrest and conflict – which is why Al Gore and the IPCC were awarded the Nobel Peace Prize in 2007. This award contributed to the mounting pressure on world leaders to combat climate change, and this is an agenda that has now caught the attention of the world.

On first consideration, the task of reducing emissions of carbon dioxide and other greenhouse gases while still maintaining economic growth might seem overwhelming. However,

Denmark has been able to keep energy consumption stable while the economy has grown by 70% since 1980. In other words, it is possible to break the traditional lockstep of growth rates and pollution levels (see An energy fairytale?).

Henceforth, a key part of the struggle to combat climate change is effective

communication. By now the devastat- ing effects of climate change should be apparent for all. Accordingly, the task at hand is not a matter of com- municating why we need to act – but of putting across the message about how we can actually achieve low-carbon living in a low-carbon economy.

Fortunately, the crisis plays a key role in driving the development of solutions for low-carbon living, and we must commend businesses and industries that cater for the low-carbon economy to come. This publica- tion is a tribute to their achievements.

In Climate Solutions Denmark, industries such as energy, transport and construction present what can actually be done in the fight against global warming, using solutions that are available here and now.

Furthermore, Climate Solutions Denmark focuses on where the battle will take place (see Cities are the solution to climate change) and what will drive the market (see The clean

tech boom). In essence, this makes Climate Solutions Denmark a survival guide for stakeholders in the fields of energy and the environment.

The climate crisis is no longer a matter for debate or discussion – it is a matter of finding solutions.

•

Monday Morning

From why to how

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D

enmark has achieved the remarkable feat of breaking the traditional lockstep between economic growth rates and pollution rates, partly on account of having opted to establish a focus on wind energy thirty years ago. As a result, the world often looks towards Denmark when considering solutions to the climate crisis. Nevertheless, Denmark does still face some key challenges.

The Danish economy has grown substantially over the last thirty years. The Danes have become notably richer – and it shows, both in people’s homes and throughout the Danish countryside. The number of vehicles on the roads has broken all records, and there has been widespread expansion of the highway infrastructure. . More and more houses and other dwellings have been built, and the number of domestic appliances has mushroomed. However, the gross energy consumption remains the same as it was thirty years ago. This is remarkable, because the energy consumption of other countries has risen significantly. Elsewhere, growth and development have resulted in energy-gobbling housing estates, cars and factories.

In the US, energy consumption is out of control to such

an extent that some states have witnessed several large- scale blackouts due to power overloads. In China, the appetite for energy is so insatiable that 30 new nuclear plants are planned. This makes the overall picture regarding energy consumption in Denmark exceptional – and it is the result of one of the unheralded successes of the Danish business community – the energy industry. A unique degree of collaboration between innovative knowledge and research centres, visionary companies, critical consumers and com- mitted politicians has brought Denmark in the global élite as regards wind energy, efficient energy systems and the mainstream integration of renewable energy. As a result, Denmark has succeeded in serving as a national-level laboratory for new forms of energy and their efficient use.

A survey conducted by The Danish Ministry of Economic and Business Affairs maps more than 400 clean tech companies with over 60,000 employees, and 46 research centres working at the interface between energy production and the efficient use of such energy in industry. But the search for ” good energy” permeates all aspects of Danish society, from national energy planning and the decentralised energy

Denmark has achieved the remarkable feat of breaking the traditional lockstep between economic growth rates and pollution rates, partly on account of having opted to establish a focus on wind energy thirty years ago. As a result, the world often looks towards Denmark when considering solutions to the climate crisis. Nevertheless, Denmark does still face some key challenges.

An energy fairytale?

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structure to industry clusters and Danish homes, which are normally insulated from top to bottom.

In Denmark, the interest in renewable and environmentally friendly energy is deeply embedded. It is striking that the shares of Vestas – the largest Danish manufacturer of wind turbines – are mainly owned by small Danish investors and private individuals. Furthermore, polls continue to show that the Danish population wishes to remain self-sufficient in terms of energy supplies, and to achieve this without resorting to nuclear energy. It was the domestic market that ensured the build-up and continuity in the Danish wind power industry. This development has also been driven by a grassroots-driven interest in wind turbines, which resulted in a decentralised production set-up as local associations erected wind turbines at a rapid rate in the 1980s. Later on, new wind turbines were often set up by local farmers.

So while the use of nuclear power spread throughout Germany, Finland and Sweden, the Danes looked towards alternative forms of energy. Not even the Danish oil and gas successes of the 1980s and 1990s altered this basic strategy – quite the contrary, in fact. These two aspects of the energy business have made a significant contribution to Denmark’s leading position in the field of effective utilisa- tion of energy.

Today, more than 20%of Danish electricity consumption is met on the basis of wind energy. Furthermore, the cost of producing energy this way has fallen by 75% since 1970.

These wind energy achievements, along with the world’s most efficient lean coal technology, are some of the key reasons for Denmark having the lowest energy consumption per unit of gross domestic product in the European Union (2005 data).

However, Denmark does still face challenges. Much of the country’s energy production is still based on coal – the least CO—friendly of the fossil fuels – and Denmark has an above-average carbon dioxide emission per capita compared with other European countries. Furthermore, Denmark is currently struggling with the cost of establishing new offshore wind turbines. Even though most Danes are wind energy aficionados, few would like to see a turbine in their own backyard.

And wind can be a capricious affair. Natural fluctuations in the amount of wind available mean that the wind can meet all energy needs in one place, while no energy at all is being produced somewhere else. Experiments are currently under way to find new ways to harness wind energy or to store the large amounts produced when the wind is strong.

However, for the time being Denmark still relies on maintaining energy production systems that can function with no aid from the wind, thus still leaving room for improvement in terms of environmental effect.

Nevertheless, Denmark has been able to decouple growth rates and pollution rates. Since 1980, Denmark has maintained a stable level of energy consumption while still achieving 70% economic growth over the same period. In short, Denmark has become both wealthy and environmentally conscious while barely increasing its own consumption of energy, not least by harvesting the power of the wind.

•

Monday Morning

7 More than 50% of Danish power and heat is produced at

combined heat and power plants – the most sophisticated energy production infrastructure of this kind anywhere in the world. While many other countries simply discard the heat from power production, 80% of the heat produced in Danish combined plants is in fact a by-product of generating electrical energy. In addition, much of the Danish production of heat and power is decentralised, which reduces energy losses that stem from transporting heat over long distances. This makes the Danish system the most energy-efficient in the world.

60 80 100 120 140 160 180

1980 1985 1990 1995 2000 2006

Index 1980 = 100

GDP, 2000 Prices

Gross Energy C onsumption, Adjusted GDP and Gross Energy Consumption

Source: Danish Energy Authority Energy Statistics 2006

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F

orget all about the short and bloated dotcom boom of the last hectic years of the 20th century. The first half of the 21st will be one long clean tech boom, making the dotcom incident look like quick foreplay for Silicon Valley geeks. This time it is for real. A global mega-market for clean tech and new energy-efficient solu-

tions is growing with giant strides from one day to the next. From Silicon Valley to Europe and China, venture capitalists are stampeding to get their hands on this market and to exploit its

potential for revolutionising the global economy during the 21st century.

Already, billions and billions of dollars are being traded on the clean tech market, and clean tech champions are chasing the big prize.

The clean tech market will multiply in the coming years, as the oil prices soar. The growth of the global econo-

my will drive the demand for energy, and the mounting evidence of climate change taking place will pressure politicians at the UN Climate Summit in Copenhagen in 2009 to reduce

greenhouse gas emissions still further.

In the autumn of 2007, more than 600 business leaders, scientists, engineers, architects and other experts gathered at the annual Copenhagen Climate Solutions conference. This event showed that a lot of businesses have a historic opportunity to reap the financial benefits. However, doing so requires leadership, the development of new solutions and the ability to capitalise on the substantial amounts of research carried out and the energy-efficient technologies already developed, awaiting large-scale com- mercialisation.

The oil peak strengthens clean tech

The decisive driver behind the clean tech boom is the price of oil. In the last decade, energy prices have increased fivefold and in the next ten years the price on oil might triple. “The price of oil has reached a historic high

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The clean tech boom

We have only seen the beginning of the clean tech boom of the 21st century. An oil price of 200 dollars per barrel will be the driving force behind the demand. 8 out of 10 businesses see commercial

opportunities in clean tech and scores of companies have a strong basis for making substantial profits.

However, the train is moving – fast.

The price of oil has reached a historic high and may soon rise above 100 dollars per barrel.

During the next decade the price of oil may exceed 200 dollars per barrel.

Christian Motzfeldt, CEO, Vaekstfonden

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and may soon rise above 100 dollars per barrel. During the next decade the price of oil may exceed 200 dollars per barrel,” says Christian Motzfeldt, one of those attending the

Copenhagen Climate Solutions event, and CEO of Vaekstfonden, one of the largest venture capitalist players in Denmark. Careful analysis of the supply and demand curves makes Motzfeldt draw these conclusions.

Supply will soon be unable to rise any further because production from most of the known large oilfields has peaked, while the demand for energy is intensifying due growth in the global economy. Naturally, this has a serious impact on oil prices. The global economy is expanding at an annual rate of

4% and Motzfeldt anticipates that the coming decade will surpass the previ- ous in terms of growth rates.

A comparatively large part of this growth will take place in places like China and India but also in Latin America and Africa, and these are all young economies engaged in building infrastructure. This takes its toll on the energy account, says Motzfeldt. He points to the US, where the annual consumption of oil until 1975 rose to 30 barrels per person. Since then, this consumption has levelled off to 24 barrels per person. This pattern of development repeated itself in Japan, only much quicker between 1950 and 1970. We are now facing the construction of a modern infrastructure in

heavily populated regions such as China, India, Latin America and even- tually Africa. In China alone, the authorities will be building 50 airports, 5,500 km of high-speed railways and thousands of kilometres of highway within the next 5 years. This will inevitably be followed by a boom in transport, and both phases are activities that guzzle energy- at a high rate.

The need for energy is already huge.

Wars, natural disasters or political conflicts are usually the causes of heavy increases in the price of oil, resulting in supply falling and stocks shrinking. But now the stocks are diminish despite there being no wars, storms or political conflicts to cause significant interruptions in the produc-

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tion of oil, Motzfeldt points out. This means we have witnessed a fundamental change, he believes. Oil production in the US peaked in 1970, in Great Britain in 1999, and in Norway in 2001. The CEO of Vaekstfonden does not consider it likely that we will find sufficiently large new oilfields in the Mexican Gulf or in Disco Bay near Greenland to replace the old ones within a foreseeable future. “It’s like having a few outs in poker. The new fields to be discovered cannot entirely replace production at the old fields, nor keep up with the global demand for energy,” he says.

Beyond break-even

The wind turbine industry achieved the break-even point when the price of oil reached 50 dollars per barrel. The higher the oil price, the more competitive energy produced by wind turbines becomes. The global production of wind energy exceeded 74,000 MW in

2006 and capacity expanded by 32%, to the extent that the manufacturers are currently struggling to keep up.

Wind turbine manufacturers are not the only ones with full order books, however. The markets for solar panels and cells have experienced annual growth rates of 38% since 2001. The use of ethanol as a fuel is booming from Brazil to the US, and wave energy, hydro-electric power and energy- saving technologies, as well as nuclear and hydrogen energy, are facing a prosperous future.

“In Silicon Valley alone, more than 2.5 billion dollars have been invested in projects designed to find the successor to fossil fuels in transport, and all the major companies in Silicon Valley are tripping over themselves to put solar cells on the roof,” says Marianne Toftegaard Paulsen, Director at Innovation Centre Denmark in Silicon Valley.

In the US, venture capitalists have increased their investments in energy technology from 916 million dollars to 2.4 billion dollars in 2006.

Enthusiasm is so massive that several of the celebrities of the Internet revo- lutions, such as Bill Gates, Steve Case and John Doerr, have predicted that the 21st century will be the era of green tech. Each member of this trio has invested millions of dollar in clean tech companies. Pension funds are also betting a lot of money on the clean tech boom.

“The financial climate change has really set in this year,” says Erik Alhøj, Manager at GES Investment Services.

“In the first seven months of 2007, 17% of the European security funds were invested in green funds. This is a very substantial growth compared to last year when green investment only accounted for 3%,” he points out.

London-based New Energy Finance estimates that venture capitalists and private equity funds invested 18 billion dollars in renewable energy sources during 2006. Their analysts anticipate an annual growth rate of 17% over the next five years.

Carbon footprints by giants

The largest companies in the world are also moving towards increasingly higher environmental standards and technologies. The report produced by The Carbon Disclosure Project 2007 had studied how the 2,400 largest companies in the world were behaving with regard to climate change. Among the top 500, eight out of ten believes climate changes pose a commercial risk in the form of measures such as new regulations. Roughly the same num-

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USD/bbl

Crude oil - dated Brent Spot

Source: Danish Energy Authority Energy Statistics 2006

10 20 30 40 50 60 70 80 90 100

April ’91 April ’92 April ’93 April ’94 April ’95 April ’96 April ’97 April ’98 April ’99 April ’00 April ’01 April ’02 April ’03 April ’04 April ’05 April ’06 April ’07

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bers of companies see commercial opportunities. 76% state that they have set goal for reductions in greenhouse gas emissions in their company.

This is a substantial increase compared to the year before, when only 42% wanted to do better. Climate change is becoming big business and the biggest companies see no alternative to seizing the challenge instantly.

Dell wants to cut its carbon footprint by 15% within five years and the target is zero emissions. Timberland has started marking all its products in terms of the carbon footprint they leave behind, and Wal-Mart has asked its 60,000 suppliers to measure their carbon footprint. At Boots, the British pharmaceutical and health retailer, Sustainable Development Manager Andrew Jenkins has been measuring

the carbon footprint of the entire supply chain. “The climate change is a symptom of a much larger disease, which is an unsustainable lifestyle,”

Jenkins argues. “The global population grows, the consumption soars and the levels of inefficiency rise, all resulting in waste problems and loss of biodi- versity. As a company, we wish to do something and reduce our carbon footprint.” Andrew Jenkins believes that lean and green management go hand in hand. “Good green management is a sign of fiscal health because it reduces all unnecessary waste throughout the supply chain and min- imises energy consumption.”

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Bjarke Møller

The climate change is a symptom of a much larger disease, which is an unsustainable lifestyle.

Andrew Jenkins, Sustainable Development Manager, Boots

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G

lobal climate change confronts our cities with massive challenges that radically question the way we have planned, governed and used our cities to date. Our cities have become the main driving force in the global economy – yet the creation of wealth has its price. Almost 80% of all CO2 emissions stem from urban activities, which make cities the biggest contributors to global warming. This means we need to focus on climate solutions for the cities of the world, as they represent both the cause and the key to the crisis.

Today, most cities are the product of a development process that favours effectiveness, production and human consumption over environmental needs. The troubling results of this mindset are becoming apparent to us today. It is no longer possible to overlook the fact that climate changes are affecting the life of urban dwellers both in their own cities and on a global scale. Cities everywhere are being confronted with a shared dilemma: how best to respond to environmental challenges via a reduction in emissions while at the same time remaining competitive and attractive in a globalised economy. The answer is to be found in the development of the sustainable city.

The sustainable city

By nature, cities are environmentally friendly because they concentrate populations, and reduce the amount of energy needed for heating and transport of goods and people. But so far we have not succeeded in creating environmentally sustainable cities, as we have failed to understand the com- plexity of the urban challenges that we face.

The cities of the world account for the majority of the global emissions of carbon dioxide. However, these self-same cities also hold the key to the solution of the climate crisis. Concepts for the sustainable city of the future are developing – but they require a fundamental change in our approach to thinking, planning, building and managing cities.

Cities are the solution to climate change

During 2000–2030, the world’s urban population is projected to grow at an average annual rate of 1.8 per cent, nearly double the rate expected for the total population of the world (almost 1 per cent per year).

At this rate of growth, the world’s urban population will double in 38 years.

United Nations Population Division

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We have become used to thinking and acting fragmental- ly: rather than consulting health experts, geographers and anthropologists, city officials have focused on the technical design of buildings and urban areas. This has resulted in the construction of cities that fail to meet the most basic needs necessary to secure future liveability. Current urban development ignores the fact that we need cities to be environmentally, socially and economically sustainable at the same time. Climate change should not only to be seen as an environmental issue, but as much an issue of growing poverty, rising inequity and lack of education. The need to understand cities from this interrelated perspective is con- firmed by the growing number of problems caused by climate change, extensive globalisation and increasing urbani- sation all taking place simultaneously.

Besides putting great pressure on the environment and public utilities, this development leads to fewer resources, growing social discrepancies, rising crime rates, lack of affordable housing and a rise in chronic diseases – to men- tion just some of the challenges facing our cities on a glob-

al scale. These challenges must be met within city borders.

As well as the city causing these challenges, we need to look into how the city can solve them. This is why we need to optimise and concentrate all our efforts into developing and strengthening the sustainable city.

To secure our urban future, we need quick action. We have therefore asked 50 of the world’s foremost urban experts to tell us what it will take to create sustainable cities. Representing all parts of the world and from a wide

range of disciplines, they all agree that to make cities sustainable we need a radical change of mindset, new strategies, and – finally, but crucially – new governance models to support development and foster a new generation of urban

leadership. These statements and observations have been distilled into the following 10 principles for future sustainable governance, aimed at existing as well as future urban residents, academics, professionals and leaders – all with the aim of encouraging and strengthening the development of sustainable cities.

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It seems we have to reassess our role as designers – the

expectations for design solutions need to be broader and include a much more complex vision for urban development.

John Peterson, Founder, Public Architecture, San Francisco

By using the existing institutional structure, we will not be able to resolve the climate issues, the local environmental issues or even the economic issues. To solve these problems we need a major institutional reform.

Eric Britton, Founding Director, The Commons, Paris

World population

Source: United Nations Population Division 0

1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000 8,000,000 9,000,000 Total (000’s)

Rural population

Urban population

1950 1970 1990 2010 2030

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1. REDISCOVER THE CITY.We need a radical change of mindset: A city is much more than a discharge valve for the process of consumption. It must become a self-sus- taining organism – complementary to nature, rather than acting as hostile opposition to it.

2. REDEFINE CITY VALUE.A sustainable city depends on the attitude and behaviour of each urban individual and user. We-must encourage a sense of citizenship and individual responsibility towards sustainable values, rather than mere consumerism.

3. INVOLVE EVERYDAY EXPERTS.Sustainable cities are participatory cities. We must encourage user-driven self- governance. Through new partnerships between city users, a common understanding of the sustainable city must be developed and initiatives agreed upon.

4. BREAK DOWN SILOS.Sustainable city planning is inherently multidisciplinary. This is why old administra- tive structures should be abandoned in favour of innovative, cross-sector cooperation.

5. REDISTRIBUTE URBAN DECISION-MAKING.

Environmental changes do not respect city borders.

Vertical cooperation between local, national and international public institutions is crucial for sustainable city planning.

6. DE-DESIGN URBAN PLANNING.City planning should be people-centred, rather than design-centred. A city is a constantly evolving organism, and city planning must adopt a perspective that is broader than the design of individual buildings.

7. PROMOTE CORPORATE URBAN RESPONSIBILITY.

Sustainable cities and successful commerce are inter-

dependent. Companies must be considered stakeholders and invited to participate in city planning and take on responsibility for urban sustainability.

8. GO GLOBAL.Climate change is a global challenge.

Global cooperation on the development of environmental technologies is essential, and a joint effort to solve the massive problems of the developing world’s cities is urgently required.

9. EMBRACE CHAOS, CRISIS AND CHANGE.A sustainable city must be capable of adapting to unexpected change.

The ability to fight both current and future climate change is crucial. Flexible governance and an innovative mindset to overcome crisis are vital.

10. ENCOURAGE PASSION IN URBAN LEADERSHIP.More will be expected of urban leaders of the future. They must be able to manage the complex interlinking of new institutions and partnerships. A mix of business management, political leadership and creativity is demand- ed from the future generation of urban leaders.

The Next step Copenhagen Agenda for Sustainable Cities was established to lay down an agenda for creating the sustainable city. To do this, the initiators will continue to work with relevant national and international stakeholders to ensure that the 10 principles are put into action. Projects, exhibitions and initiatives that aim to gather and distribute international best practice are among the activities included in this effort. The results will be presented ahead of the UN Climate Summit that will take place in Copenhagen in 2009.

Find the extended version of these 10 principles at:

www.mm.dk/filer/10principles.pdf

•

Ida Strand

If you just say: ‘Stop polluting’, nothing will happen. But if you create a market for sustainable behaviour, businesses will see the potential and then take action.

Chris Steins, Director, Urban Insight, Los Angeles

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Every step in the right direction counts. In every step you take, PwC can help you respond and implement the climate change management system relevant to your business.

Please contact our climate change expert Birgitte Mogensen.

E-mail: bmo@pwc.dk or phone: +45 3945 9276.

Visit us in Denmark: www.pwc.dk/sustainability

Visit our global webpage: www.pwc.com/sustainability PwC’s climate change

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I

n December 2009, the world will have its eyes on Copenhagen. Some 10,000 participants from approximately 170 countries will take part in the most important meeting since the UN Climate Summit in Kyoto in 1997.

As the Kyoto Protocol expires in 2012, the UN Summit in Copenhagen in December 2009 is a key piece in the puzzle that establishing a successor involves.

Not surprisingly, this has created a lot of excitement in Denmark and the Nordic region – a part of the world with a strong tradition for sustainability, and hence green competencies. The forthcoming UN summit and the rapid- ly accelerating focus on the climate crisis on the global agenda have cata- pulted both efforts and levels of ambi- tion in this regard. Politicians and business leaders alike strive to take the lead in the field of sustainability and in reducing carbon footprints.

Politicians overbid each other in their ambitions for increasing the pro- portion of energy consumption based on renewable sources. Approximately 15% of Denmark’s energy consumption currently stems from renewable

energy sources. Demark has been pointed out to take the lead in this effort as 30% of the Danish energy supply must derive from renewable sources in 2020. Businesses are also racing towards ensuring “greener” profiles for themselves. Solar panels are being installed, carbon-neutral buildings are being erected, and guaran- tees of renewable energy deliveries are being snapped up like hot cakes.

One result of this is that the market for green technology in Denmark is thriving. This is evident when CEOs, environmental managers, politicians, clean tech investors, technical advisors, buyers and sellers of the leading

businesses and industries of Northern Europe gather once a year at the Copenhagen Climate Solutions event.

This is a highly focused conference and exhibition at which numerous industries present what it is in fact possible to achieve in the fight against global warming, by fielding technologies and solutions that are available right now.

The fight against global warming has sparked what Professor John Elkington, founder of SustainAbility and an active participant in the environmental debate for 30 years, calls a new wave of globalisation. This time around the focus is on innovation and

Cool Competencies

For decades, Danish companies have been taught to think and operate in an environmentally

responsible manner. As climate change ascends the global agenda, this makes Danish companies well positioned in the clean tech race. However, the path to green gold is not without hurdles.

Broad smiles at the annual Copenhagen Climate Solutions event as Danish businesspeople discuss the potential in the clean tech market.

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creativity – the exact competencies embedded in Danish businesses.

“You in Denmark have the culture of innovation and creativity. We in America have the markets, we have the capital, we have the scale, and we have the collaborators to harness that creativity to change the world. Some of the great commercial success stories of recent days have come from partnerships between Denmark and America.”

Innovation and creativity are part of the explanation for Denmark’s position as the third most competitive economy on the planet. This competitiveness is rooted in a plethora of fast-reacting small and medium-sized businesses.

Only two Danish companies are large enough to be included in the Fortune Global 500 list: A.P. Moller-Maersk and The Danske Bank. An additional source of strength for this myriad of small and medium-sized companies is their position in key growth fields such as design, renewable energy and environmental technologies. A study conducted in 2003 by The Danish Enterprise and Construction Authority’s Division for Research and Analysis revealed no fewer than 420 such companies and more than 60,000

employees whose work focuses on environmental technologies. These numbers have undoubtedly increased since then.

Furthermore, Danish competitiveness and competencies in the clean tech market have been strengthened by a tradition for environmental pro- tection policies in Denmark. This forces Danish companies to both think and operate with a mindset based on sustainable solutions. Danish compa-

19

You in Denmark have the culture of innovation and creativity. We in

America have the markets, we have the capital, we have the scale, and we have the collaborators to harness that creativity to change the world.

Some of the great commercial success stories of recent days have come from partnerships between Denmark and America.

James P. Cain, US Ambassador to Denmark at Copenhagen Climate Solutions 2007.

30% of the Danish energy consumption must stem from renewable energy sources by 2025. At Copenhagen Climate Solutions 600 key stakeholders gave their input on how to achieve this goal.

The Global Competitiveness Ranking

Source: World Economic Forum

United States Switzerland Denmark Sweden Germany Finland Singapore Japan

United Kingdom Netherlands

1 2 3 4 5 6 7 8 9 10 2007-2008

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nies are therefore well-positioned to grab a share of the winnings as and when the market for clean energy quadruples in the decade to come.

Danish businesses are clearly aware of this, resulting in broad smiles and optimism a at clean tech meeting grounds such as Copenhagen Climate Solutions events.

However, while being small and agile has certain advantages, Danish businesses might still lack a key elements in the scramble for the green Klondike – financial muscle. Although the innovative and creative competencies of Danish businesses have created solutions that help tackle global warming, such companies often lack the ability to capitalise on these solu-

tions. The downside of being small and responsive is lacking the muscle to commercialise products on a large scale in the global marketplace. As a result, Danish companies are often in a position of seeking partners and venture capital to help them exploit

the full potential of their competencies for reining in global warming.

•

Meik Wiking

COPENHAGEN CLIMATE SOLUTIONSis Scandinavia’s largest meeting place for key stakeholders in the fields of energy and clean technology to advance solutions that help combat climate change. The annual Copenhagen Climate Solutions event takes place as a combined conference and exhibition. While the conference identifies current challenges and opportunities, the exhibition presents state-of–the-art solutions for achieving a low-carbon economy. This makes it the most important and largest marketplace for energy-focused and clean technology solutions in Scandinavia.

www.copenhagenclimatesolutions.com

• sustainable product development

• solar screening and urban windmills

• energy-saving façade systems

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• furniture from recycled materials

• building components

• infrastructure elements

• plan holistically

• design with environmental awareness

• integrate natural ventilation

• regulate indoor climate thoughtfully

• vary energy balance via building façades

• use underground thermal capacity

• integrate solar and wind energy

GeoCenter Møns Klint, DK

www.plh.dk

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Is your company taking responsibility for climate challenges?

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T

he need for energy will continue to grow. Much of this increased demand will come from the developing world, where nations will need more energy to build critical infrastructure and grow their economies, improve the lives of their people. Overall, the demand for energy is expected to rise by more than 50 percent by 2030.

This growing demand for energy is a sign of a vibrant, global economy. Yet it also raises serious challenges.

When we burn fossil fuels we release greenhouse gases into the atmosphere, and the concentration of greenhouse gases has increased substantially. There is now overwhelming evidence that emission of greenhouse gases will have to be reduced very substantially during the coming decades.

This means that climate change is today and will remain for the foreseeable future an important item on the political agenda and an important element of the business agenda.

Managing the security of energy supplies is also increasingly becoming a major issue.

New technology is the long-term solution

For many years those who worried about climate change and those who worried about energy security were on oppo- site ends of the debate. It was said that we faced a choice between protecting the environment and producing enough energy. Today we know better. These challenges share a common solution: technology. By developing new low-emission technologies, we can meet the growing demand for

energy and at the same time reduce air pollution and greenhouse gas emissions.

The electricity industry, in particular in the industrialised world, plays an important, pro-active role in providing economically feasible solutions for ensuring security of supply and achieving reductions in greenhouse gas emissions.

But no sector or no country has all the answers, including Denmark. But important parts of the solutions can be found among the Danish energy companies.

World leader in power generation

Future progress in power generation technologies is of paramount importance on the path towards a sustainable electricity system. Technologies providing CO₂-free or CO₂-low electricity are of key importance, alongside improvements in thermal efficiency and the introduction of technologies to capture and store carbon dioxide.

Danish Energy producers are among the world leaders when it comes to the ability to produce electricity and heat from fossil fuels, wind power, biomass and waste.

Companies in the Danish Energy sector are major investors in renewable energy and when it comes to off-shore wind they are the global leading firms.

Three out of five of the world’s most efficient fossil-fuel power plants are placed in Denmark. A major driving force behind the high efficiency is a long-termed effort to com- bine electricity and heat generation. This progress has been

Denmark; a melting pot for solutions

Everyday energy brings countless benefits to the world’s population. Energy powers hospitals and

schools so we can live longer and more productive lives. Energy transforms the way we produce food, so

we can feed the worlds growing populations. Energy enables us to travel and communicate across great

distances.

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possible merely through a close partnership between the energy sector and the national and local authorities.

Let us suppose for the sake of argument that all power plants in the world were as efficient as the Danish then the global emission from the fossil-fuel power plants could be reduced with 30 percent equivalent to a reduction in CO₂ emission with approx. 2 bn tons per year.

Carbon capture and storage

CO₂, the most important anthropogenic greenhouse gas, is produced in every process in which carbon is burned. CO₂ emissions are thus a major issue for any use of fossil fuels, whether in transport, industry or power generation. “De-car- bonising” electricity production from large-scale fossil-fuel power plants is therefore a tempting political and techno- logical goal. Improving thermal efficiencies alone will help, but will not enable the total removal of CO₂emissions. One of the most promising technology paths for the future is carbon capture and storage (CCS), in which the CO₂from power plants would be captured at the plant and then transported and injected into the underground. This will require the development of new solutions. Many of the required technologies actually already exist in smaller-scale industrial applications, but the main challenge for electricity production is to develop them for secure and economic use by large thermal power plants.

Denmark is in the lead when it comes to developing CCS technology. Vattenfall has decided to carry out the first examinations of the underground in Northern Jutland. The objective is to verify Danish and foreign geologists assess- ments that the underground in Northern Jutland is one of the most ideal places in the world for storage of CO₂. Subsequently they will start planning the construction of a full-scale CCS plant in connection with the power plant Nordjyllandsværket. If the underground is suited for CO₂ storage and if the technical challenges are solved, the plant is expected to be ready for operation in 5 to 10 years. The other major Danish energy company Dong Energy takes an active part in developing the future CCS technology as well.

Wind, Flexible Consumption and Electric Vehicles

In the years to come Denmark will be increasing our wind power production. Some would claim that 60 percent of the

electricity supply will derive from wind power. This poses serious challenges to the Danish electricity market and -system. For several hours per year we will experience that the wind turbines will be producing more than 100 percent of the electricity needed in Denmark. The surplus production must be exported or we will have to find new ways to use the power. In the years to come Denmark will have to focus on development of a much more flexible electricity consumption and one of the promising technologies is electric and plug-in hybrid vehicles for private road transport. Ja nogen siger op imod 60% af el forsyningen vil komme fra vind. Det rejser alvorlige udfordringer for det dansk elmarked og det danske elsystem. Vi vil opleve mange timer på året hvor el produtkionen fra windturbinerne vil producere mere end 100% af det danske behov for el. Den ekstra strøm skal eksporters eller vi skal have fundet nye måder at bruge strømmen på. Danmark skal derfor i de kommende år satse hårdt på udvikling af et langt mere fleksibnelt el forbrug og en af de meget lovende teknologier er el biler og Plug-In Hybrid Electric Vehicle for private road transport.

Energy efficiency

Energy efficiency improvements will be an important goal in all energy applications but they will be paramount in the transport sector, which is not only the major user of energy, but also relies overwhelmingly on imported oil as its energy source. To a significant extent, the same consideration holds for space heating, relying on imported gas and oil.

Still it is the case that a lot of energy efficiency technology is not applied early enough. The Danish energy companies have made an agreement with the Danish government that ensuring of energy efficiency initiatives is part of the service package.

Energy efficiency improvements are substantial when it comes to a sustainable future and therefore it must be a central focus area both in EU and nationally.

A bright future

Energy-efficiency improvements must be exploited to the full. The move to a low-carbon electricity system must be accelerated by pro-actively using and developing all low-carbon technologies. And, last but not least, it is essential to develop the remarkable potential offered by combining low- carbon electricity with efficient electro-technologies. These

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hold the promise of making both the heating & cooling and road transport sectors much more energy efficient, drasti- cally less carbon emitting and far less dependent on imported hydrocarbons.

A European energy policy based strongly on demand-side energy efficiency, active development of all low-carbon supply sources and active exploitation of the synergy between low-carbon electricity supply and efficient electro-technologies will ensure the transition to a low-carbon economy while contributing to both the security of Europe’s energy supply and the competitiveness of the economy.

I the European context Denmark must strive to be a leader when it comes to investment in future technologies, research and development.

Curbing climate change is about combining technology, finance and policy in a wise way. Technology is not an unsolvable problem, given time and incentives, neither is financing. The real challenge is policy.

Electricity has the potential to contribute substantially to the three main pillars of energy policy. It holds the key to substantial reductions in greenhouse gas emissions at rea- sonable cost to the economy, while at the same time helping to reduce oil and gas dependency. In order to seize this opportunity, a clear energy policy pathway must be imple- mented without delay. Thisnew pathenergy policy for the coming decades must be based on five equally important keystones, which must be pro-actively developed in parallel.

Unleash the potential of energy efficiency

An energy savings culture must be encouraged among all elements of society, using a variety of tools. Education, incentives, standards and labelling, research and technolog- ical development – each one must contribute to fostering energy-efficiency in all sectors of the economy: in house- holds, in industry and service sectors, in transport and through all energy vectors and technologies.

Develop a low-carbon electricity system by using all available options

The next decades must see further progress towards a low- CO₂electricity generation mix through the pro-active use and development of all available options: hydropower, wind, biomass, waste and clean an efficient fossil-fuel technology including carbon capture and storage.

Intelligent electrification of the economy

Intelligent electrification of the economy entails two vital imperatives. The first is to improve electricity efficiency on both the supply and demand side by developing more efficient power generation technologies and by improving efficiency in all kinds of applications including lighting, standby power, motor drives, etc. The second is to actively develop the far-reaching synergy between CO₂-low electricity supply and energy efficient demand-side electro-technologies. This process must be accelerated in many industrial or commercial applications and public transport and must be pro- actively extended to two sectors where electrification allows very substantial progress in terms of energy efficiency, CO₂- emissions reduction, and oil/gas dependency: heating and cooling through the useof heat pumps; and road transport via plug-in hybrid cars.

Consistent deployment and a market-oriented approach The benefits of both existing and new technologies, on both the demand and supply side, must be exploited through practical take-up. This calls for a consistent deployment strategy oriented both to making widespread use of existing technologies, and to making new technologies a business reality through R&D, demonstration programmes, long-term CO₂price signals and removing barriers to market integration.

Public support policies, where these prove to be necessary, should be organised in such a way as to promote cost- efficiency, marked based and to foster speedy integration of new technologies into the market. The long-term nature of supply-side and of certain demand-side energy investments requires long-term visibility for carbon pricing so as to facili- tate the integration of climate change action into investments and business strategies.

Global cooperation on global issues

The magnitude of the energy challenge makes it impossible for a single country or continent to solve it on its own.

Therefore, we have to develop solidarity mechanisms, partnerships between suppliers and users of energy at international level and in the business domain, international cooperation on R&D and demonstration projects, and an international framework for climate change policies and cooperation.

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Intensive R&D work focusing on aero- dynamics and blade profiles has enabled LM Glasfiber to improve the efficiency of wind turbine blades, and thus extract even more energy from the wind.

LM Glasﬁber has boosted the ability of composite materials to meet demands for lower weight and greater strength, without compromising on blade reliability.

We operate the most comprehensive testing programme in the industry,

right from laboratory materials testing on individual ﬁbres to full-scale testing of blades. This ensures maximum reliability with minimal blade maintenance costs over the service life of the wind turbine.

Experience gained from manufacturing more than 80,000 wind turbine blades, along with a global manufacturing, sales and service organisation, ensures highly efﬁcient, reliable blades for your next wind energy project.

Striving to reduce the cost of energy

www.lmglasﬁber.com

LM Glasﬁber

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ABB is a leader in power and automation technologies that enable utility and industry customers to improve performance while lowering environmental impact. The ABB Group of companies operates in 100 countries and employs about 110,000.

ABB in Denmark is within ABB the corporate global leader within wind power and district heating and employs about 800 people.

How ABB cuts emissions

ABB focuses its climate change efforts on three main areas:

• Supporting efforts by customers – particularly in utilities and industry – to cut greenhouse gas emissions

• Raising energy efficiency within the company and its manufacturing processes

• Strengthening the use of clean energy sources such as wind power

ABB’s greatest contribution to the reduction of greenhouse gases is through products, systems and solutions. They

include: High-efficiency motors and variable-speed drives for motors; advanced industrial information technology to control and optimize power grids and industrial processes;

and certain types of substation and transformer which have minimal losses.

Not surprisingly, climate change has boosted interest in clean energy technology and renewable power sources.

As a leading supplier of equipment to the global wind power industry, ABB has a strong role to play. Its ability to harness wind power and integrate it into electrical grids is ongoing underlined by major contracts. As an example ABB is going to supply the German utility E.ON Netz GmbH with the power equipment that will connect the world’s largest offshore wind farm (Borkum 2) to the German grid.

A group-wide internal energy-savings program, designed to cut consumption by 5 % on production sites over two years is on track to meet its targets. In a country like Denmark, ABB has since 1998 managed over time to double its office square metres at its head office and at the

Power and Productivity

for a better World

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27 same time keep the energy consumption level below the

1998 level.

Contributing to at better world

ABB’s products, systems and solutions contribute to a better world in a variety of ways – such as saving energy and cutting harmful emissions. Below we highlight some of these contributions:

•

Sustainability in motion

High-efficiency motors and variable speed drives from ABB save enough power every year to supply five million people, while cutting nearly 100 million tons of carbon dioxide emissions. Since motor-driven machines consume about 60 % of the power used by industry, even small improvements add up to big electricity and cost savings. ABB’s motors convert power to motion efficiently and have a long lifespan.

Using ABB motors and drives, a factory assembly line, escalator, baggage conveyor belt, air conditioner or a ski lift will operate at the exact speed they need to go, rather than at any pre-set speed. Customers, consumers and the environment all benefit.

•

Bulk power transmission with low impact

ABB’s high-voltage direct current (HVDC) and HVDC Light transmission systems carry bulk power over long distances efficiently and with minimal environmental impact.

The Technology is featured in several European projects;

In Denmark an underground and underwater HVDC cable linking the two islands of Funen and Sealand to connect grids for the first time and stabilize power supplies. And in Germany a 100 km underground HVDC Light cable is going to connect wind-generated power to the mainland from the world’s largest offshore wind farm.

•

High-efficiency transformers

Transformers are key to the transmission and distribution of electrical power, acting as “gear boxes” to ensure the right type of voltage reaches the consumer. They account for most of the otherwise low level of energy losses in grids.

ABB has improved their design and use of raw materials to raise overall efficiency. Our technology allows for highly compact transformers, saving copper, electromagnetic steel and insulating oil, and reducing energy losses.

ABB was also the first manufacturer to have environmental product declarations for power and distribution transformers.

The greenest energy is energy saved

Barely a day goes by without talk of climate change.

Renewable energy, carbon capture and biofuels are among the main solutions put forward to mitigate climate change.

They are valid methods and must be pursued but the truth is that most of the technologies are either not ripe, still too expensive or have unwanted side effects.

There is a quicker, cheaper and more effective way of reducing carbon dioxide emissions that can be applied right now: energy-efficient technologies that are commercially available and proven. Energy efficiency is the low-hanging fruit in the campaign to protect the environment because the technologies exist and we know the savings they will deliver.

In industry, the biggest reductions in emissions in the short term will come from measures to run processes more efficiently. To give one example, about 40 % of electricity is consumed by industry, and two-thirds of that is used by electric motors. Devices to regulate the speed of a motor can reduce their energy consumption by 50 % in many applications. Yet less than 10 % of motors are equipped with such a device.

Fitting them to all the motors shipped last year alone would avoid 200 million tons of carbon dioxide emissions per year, more than three times the annual emissions of Denmark. And there are many more energy saving opportunities like this.

Thus, ABB will focus on energy efficiency in its sponsor- ship of the upcomming Copenhagen Climate Solutions 2008. This is a great opportunity to raise awareness of the need to use existing resources more carefully. Industry can make a huge positive contribution but political will and support are needed to exploit its full potential.

ABBCOMPANY PRESENTATION

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The Danish company AllSun A/S, belonging to the group TopSun A/S, develops and manufactures intelligent and multifunctional energy controllers with interactive communication. The technology of the energy controllers is based on the experience gained through several years of development and application of concepts in the for- mer company PentaCom A/S, which developed and manufactured the first wireless control system for floor heating in the world.

In connection with the sale of PentaCom A/S to Danfoss A/S in 2002, activities concerning solar energy were concentrated in the company AllSun A/S, which was established early 2003.

Domiciled in an energy-saving building

In order to reduce the CO₂emission of the company we make an effort to reduce andmake the energy consumption more efficient; compared to a conventional new building, our total energy consumption is reduced by more than 50%.

The premises of AllSun A/S are domiciled in “the Brundtland Center Denmark”, a building which is based upon energy-saving technology and renewable energy.

The Brundtland Center Denmark can be seen as an energy system and such an approach calls for an integrated design process in order to achieve maximum utilization of passive and active solar energy, natural daylight and passive cooling. Thus, the multi-purpose facade is a key element in the building. The upper third is a daylight window with light reflecting blinds, the middle part is a vision window with movable solar shading, and PV panels are integrated in the