Winds of Vanity

COPENHAGEN – Copenhagen, Denmark’s capital, wants to be the world’s first CO2-neutral city by 2025. But, as many other well-meaning cities and countries have discovered, cutting CO2 significantly is more difficult than it seems, and may require quite a bit of creative accounting.

More surprisingly, Copenhagen’s politicians have confidently declared that cutting CO2 now will ultimately make the city and its citizens wealthier, with today’s expensive green-energy investments more than paying off when fossil-fuel prices rise. But how can deliberately limiting one’s options improve one’s prospects? These sound more like the arguments of green campaigners – and they are most likely wrong.

The first challenge that Copenhagen faces in reaching its zero-emissions goal is the lack of cost-effective alternatives for some sources of CO2, particularly automobiles. Denmark already provides the world’s largest subsidy to electric cars by exempting them from its marginal 180% car-registration tax. For the most popular electric car, the Nissan Leaf, this exemption is worth $85,000 (€63,000). Yet, just 1,536 of Denmark’s 2.7 million cars are electric.

There is also the challenge inherent in wind-generated electricity: ensuring that the city can continue to run when the wind is not blowing. To address this problem, Copenhagen has had to devise an electricity-generation strategy that enables it sometimes to run on coal-fired power when necessary, without creating net emissions.