Denmark announces DKK 100 million contribution for coal phase-out

Published 04-11-2021

Fossil energy is one of the biggest obstacles to a green future. Therefore, Denmark is taking targeted measures to phase out the use of coal.

Denmark will donate DKK 100 million to efforts to purchase and decommission coal power plants and invest in new energy sources. Minister for Foreign Affairs Jeppe Kofod announced the Danish contribution on Thursday in connection with COP26 in Glasgow.

“Climate change is the greatest challenge of our time, and phasing out of fossil fuels is key to reaching our goal in the fight to stop it. As part of our comprehensive climate efforts, the Danish Government is working to phase out coal while also investing massively in new green energy sources,” says Jeppe Kofod.

Coal represents the largest single cause of the global temperature rise.

Minister for Climate, Energy and Utilities Dan Jørgensen says: “It is more urgent than ever before to replace coal with green energy if we are to keep the 1.5 degree goal of the Paris Agreement within reach. The new Danish financing will help coal-intensive countries reduce their coal consumption and create new income opportunities in local communities, which is absolutely vital to accelerating the energy transition.”

The Danish contribution will go directly to the Climate Investment Fund’s new “Accelerating Coal Transition” programme. The primary focus will initially be on South Africa, India, Indonesia and the Philippines, and the programme includes efforts supporting alternative employment of the local population in impacted areas.

“We must have sustainable plans for decommissioning coal power plants. For example, we need to ensure alternative employment for the local population, including retraining programmes. As Minister for Foreign Affairs, it is important to me that we demonstrate the viability of a ‘leave no one behind’ green transition. I think that Denmark can take the lead and set a good example,” says Jeppe Kofod.

To maintain the Paris Agreement goal of limiting global temperature rise to 1.5 degrees, the United Nations has called for the phasing out of coal in all OECD countries by 2030 and the rest of the world by 2040. 

The four primary recipient countries – South Africa, Indonesia, India and the Philippines – were chosen according to the greatest available emissions reductions. Denmark already has extensive government cooperation in the energy sector with South Africa, Indonesia and India. The new programme will thereby supplement Danish efforts for renewable energy and energy efficiency in these countries. 

The UK, US, Canada and Germany have also pledged to support the Climate Investment Fund’s coal phase-out programme.

The Danish donation is part of the Government’s 2022 Finance Bill.

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