Danish companies cannot
afford to go it alone in solving current
climate issues. International collaboration
is called for, as shown by the results of
an MSc thesis from Aarhus University, Business
and Social Sciences.
2012.01.10 | Camilla
Hyldmar Knudsen
International agreements are required to
solve the climate problems. The Danish Commission
on Climate Change Policy’s proposal to introduce
an energy tax risks making it both harder
and more expensive for energy-intensive
Danish companies to compete globally.
- If it was possible to draw up broad energy
agreements in the EU, Denmark would enjoy
a strong position because we have the technology
and innovative skills to survive. However,
if the proposals are only introduced by
Denmark, then we are such a small player
compared to other countries that the energy
tax will act as a penalty for Danish businesses,
says Stefan Kirkedal, who holds an MSc in
International Economic Consulting.
Together with Cæcilie Thielke Mølgaard,
he has written a thesis: “Environmental
regulations and competitiveness – An analysis
of the effects of the Danish Commission
on Climate Change Policy’s recommendations
on the competitiveness of Danish industry”.
The two graduates have the full support
of their supervisor, Philipp Schröder,
an acknowledged economics professor from
Aarhus University, Business and Social Sciences:
- Denmark can achieve much more by influencing
European legislation instead of allowing
itself to be restricted by a national plan,
says Philipp Schröder, who also says
that the Commission’s proposal should, as
a minimum, be implemented throughout the
EU.
Companies will be penalised
In their thesis, Stefan Kirkedal and Cæcilie
Thielke Mølgaard explore, among other
things, how the energy tax on fossil fuels
will affect Danish industry in the short
and long term.
- Danish companies cannot afford the burden
of higher costs if they are not also imposed
on foreign companies. It would mean that
the energy tax will act as a penalty for
companies in the short term, says Stefan
Kirkedal, while adding that the higher costs
may also lead to companies not having the
necessary resources to innovate and find
new solutions.
However, in the longer term, the energy
tax may help to strengthen Danish businesses,
as they will be forced to streamline operations
and find new and greener production methods.
But nobody knows how long such a process
will take.
- There may be serious implications for
Denmark if we are looking at a ten-year
period of being unable to compete with foreign
companies. Many companies will be forced
to close, and workplaces will be outsourced,
says Cæcilie Thielke Mølgaard.
However, she adds that those companies which
make it will enjoy a huge competitive advantage
over foreign companies without green ambitions.
Framework agreements required
The results of the thesis also show that
some sectors will be harder hit by the energy
tax than others. Industrial companies in
particular will bear the brunt.
According to Stefan Kirkedal and Cæcilie
Thielke Mølgaard, the Danish state
and industry should together agree on a
solution which suits both parties if international
support for stricter climate regulation
is not forthcoming.
- It is far from ideal that Danish companies
are expected to shoulder the costs on their
own. The state should introduce subsidy
schemes or framework agreements which make
it possible for companies to change their
energy consumption without undermining their
competitiveness because of the significant
costs involved, says Cæcilie Thielke
Mølgaard.
- The crucial question, of course, is who
will be left footing the bill. It is in
everyone’s interest that agreements are
reached which serve all the parties involved,
says Stefan Kirkedal.
An important task
Stefan Kirkedal and Cæcilie Thielke
Mølgaard defended their thesis in
September, and both were awarded top marks.
Their supervisor, economics professor Philipp
Schröder, was very impressed with the
result.
- They have identified a subject which is
very relevant for the broader social debate,
and they have shed light on the topic from
several different angles. This has produced
a solid piece of research. Anyone wanting
to know more about the subject should definitely
read the thesis, says Philipp Schröder.
+ More
Carbon to be returned
to the soil
Biochar may be one of
the solutions to reducing emissions of harmful
greenhouse gases from agricultural land
and to improving soil fertility. These are
the research objectives of the EU research
project Refertil, which scientists at Aarhus
University are participating in.
In contrast to miners that dig the coal
out of the soil, a new research project
supported by the EU will be putting the
coal back into the soil.
Biochar is the name for the product of the
so-called pyrolysis of biomasses such as
straw and woodchip. Biochar has in recent
years emerged as an interesting research
topic, because the coal may constitute a
solution not only for reducing emissions
of greenhouse gases that exacerbate climate
change but also for increasing the carbon
content of soils. The latter will benefit
soil fertility as carbon in soil helps to
capture nutrients and in that way to halt
some of the processes that lead to leaching
and gaseous losses of nitrogen.
Lars Elsgaard, lecturer at Aarhus University,
is leader of one of the projects of a large
EU research project which over the next
four years will be looking into whether
biochar can be used as a soil amendment
product.
It would appear that biochar can be used
as a soil improver and as a source of stable
carbon in the soil that is very recalcitrant.
Biochar also has good adsorption properties
and this means that it is able to retain
the nutrients in the soil so they are available
to plants. The good adsorption properties
can also delay the conversion of ammonium
to nitrate and thus restrict the formation
of the powerful greenhouse gas nitrous oxide,
he explains.
Side effects
Together with the Knowledge
Centre for Agriculture the scientists will
be using two different types of biochar
and will record yields and greenhouse gas
emissions at four different locations in
Denmark.
The scientists from Aarhus University will
also be looking at possible side effects
of biochar and at how biochar may affect
the microbial processes in soil, particularly
the nitrogen cycle.
The pyrolysis process converts biomass to
gas, biochar and oil at high temperatures
and under anoxic conditions. This means
that a number of chemical compounds are
formed, depending on how the process progresses.
With our partners in the project we will
be testing how different types of biochar
affect soil microorganisms and we will look
at how it behaves in the soil, says Lars
Elsgaard.
The scientists from Aarhus University have
previously shown that pyrolysed straw and
woodchip from Danish sources did not appear
to have any harmful effects on microorganisms
and they expect to be able to also document
this for the types of biochar used in the
new EU project.
We believe that the levels of harmful substances
in biochar would have to be unrealistically
high for it to be an impediment to the physiological
processes in the microorganisms, explains
Lars Elsgaard. And Lars Elsgaard has clear
expectations of the final results.
I hope that at the end of the project we
will be able to document that biochar has
a function as a soil improver and that we
will be able to measure this in yields.
We will also have good documentation for
the influence of biochar on the soil ecosystem.
And we will finally have found the right
technology and biomass for the generation
of biochar to help reduce the emission of
greenhouse gases.
There are 14 partners in the project including
a large number of private European companies.
Text: Søren Tobberup Hansen
