Danish PM responds to climate demands with $1.6 billion green fund

Danish Prime Minister Mette Frederiksen delivers her opening speech during the official opening of the Danish Parliament in Copenhagen, Denmark, October 6, 2020. Liselotte Sabroe/Ritzau Scanpix/via REUTERS

COPENHAGEN (Reuters) - Denmark’s prime minister on Tuesday pledged to spend $1.58 billion on new climate initiatives in response to calls from business leaders and politicians for quicker action towards cutting greenhouse gas emissions.

The Danish government has said meeting its ambitious target of cutting emissions by 70% in 10 years is doable, but has faced headwinds for counting too much on technologies that take years to become commercially viable.

Prime Minister Mette Frederiksen defended her government’s plans for targeted investment in new technologies such as carbon capture, green hydrogen, sustainable farming and plastic recycling.

“Denmark must be a showcase for the world. But no one will follow us if our path is expensive, unmanageable and socially unjust,” Frederiksen told parliament.

The government proposed taking 10 billion Danish crowns ($1.58 billion) from the EU’s Recovery Fund and from a coronavirus “war chest” announced in August and spending it on investment in new technologies until 2025.

Earlier on Tuesday, 139 Danish business leaders, scientists and politicians, including Chief Executive Henrik Poulsen of energy group Orsted ORSTED.CO, signed an appeal for a more ambitious climate plan, accusing the government of dragging its feet.

Since parliament agreed on the ambitious climate law in December last year, the government has launched initiatives that will cut emissions by around 25% of the targeted reduction until 2030.

($1 = 6.3169 Danish crowns)

Reporting by Tim Barsoe and Nikolaj Skydsgaard; Editing by Jacob Gronholt-Pedersen and Giles Elgood