Denmark’s Green Future Fund to boost green solutions
The Danish government and four signatory parties have now agreed on the framework for establishing Denmark's Green Future Fund. The foundation will contribute to developing tomorrow's Danish green solutions.
Based on experience with previous investment projects, the Green Future Fund is expected to become a lever for private financing worth up to EUR 11 billion. In total, Denmark's Green Future Fund can thereby generate up to EUR 15 billion for financing green companies and projects.
With the fund's establishment, Denmark's investments in green solutions and green exports get a significant boost. Based on experiences from companies that have previously received funding from the underlying funds, the Green Future Fund is expected to create a basis for supporting 27,500 green jobs.
"We can support thousands of green jobs at a time when the government is focusing on the economic recovery of our society"
- Nicolai Wammen, Danish Minister of Finance
Good for Denmark, good for the world
In connection with the announcement, the Danish Minister of Finance, Nicolai Wammen said:
"Today we begin an important chapter in the green transition. With Denmark's Green Future Fund of EUR 3.3 billion, we can boost Danish green solutions, which can benefit both domestically and in the rest of the world. For many years, Denmark and Danish companies have been at the forefront of the development of green technology, and the Green Future Fund will contribute to us being able to maintain our green leadership position and push society in a more sustainable direction. At the same time, we can support thousands of green jobs at a time when the government is focusing on the economic recovery of our society."
With the establishment of the Fund, the government follows up on the Finance Act agreement for 2020, where the government and four signatory parties decided to allocate a total of EUR 3.3 billion to Denmark's Green Future Fund.
Capital injection to existing investors
The Green Future Fund will be established on the shoulders of existing and well-proven investors, notably EKF, Denmark's Export Credit Agency but also the Danish Green Investment Fund, Vaekstfonden and the Investment Fund for Developing Countries (IFU).
Minister of Industry, Business and Financial Affairs, Simon Kollerup said:
"If the climate battle is to be won, we need good, green business ideas that will have the opportunity to flourish and make a green difference in Denmark and abroad. And this is exactly what the Green Future Fund's EUR 3.3 billion should provide.
We have the opportunity for the global green agenda to become a green business adventure in Denmark, and the Green Future Fund should help create both green business successes and green jobs. I know that the Fund already has a number of exciting, green projects in mind, which can now be realised. This is not only good for the Danish climate ambitions, but also for the Danish economy."
Corona crisis makes it more important
Peter Thagesen, who is Director, International Policy at the Confederation of Danish Industry is quoted by EnergiWatch:
“We can only fulfill our high ambitions for the climate if we invest purposefully in the green transition. So it is positive and necessary that the government and the signatory parties establish a future fund that supports green projects. The Green Future Fund was adopted in connection with the Finance Act last year. But the corona crisis makes it even more important that we focus and invest.”
"Every time a Danish company participates in a renewable energy project somewhere in the world, renewable energy displaces more polluting energy sources"
- Kirstine Damkjær, CEO, EKF
More than half of the Fund money (EUR 1.9 billion) is allocated to EKF, Denmark's Export Credit Agency. EKF’s CEO Kirstine Damkjær said in a press release (in Danish):
“This initiative will affect both the green transition and employment in Denmark. Danish exporters are world leaders in green technologies, and the wind sector alone employs 33,000 people. Every time a Danish company participates in a renewable energy project somewhere in the world, renewable energy displaces more polluting energy sources. This is a positive spiral that the Green Future Fund can strengthen.”
Denmark’s Green Future Fund must annually report the total CO2 effect of the activities at both national and global level.
Source: The Danish Ministry of Finance (in Danish)
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