Denmark is getting off fossil fuels. Are there lessons for Canada?
With oil and gas demand forecast to peak before 2030, academics, workers and union leaders look to what's next
After more than a decade spent thinking about fossil fuels and climate change, Angela Carter was looking for a "beacon of hope" to inspire Canada with alternative visions for what an oil and gas-dependent society could become.
Carter, an energy transition specialist with the International Institute for Sustainable Development and associate professor of political science at the University of Waterloo, found that hope when Denmark made a landmark decision to cancel future permitting for oil and gas exploration in the North Sea in late 2020.
A country of 5.8 million people, Denmark earned the equivalent of $109 billion from oil and gas extraction in the North Sea between 1972 and 2020. The country aims to be independent of fossil fuels by 2050, and has committed to renewable power for all energy demands — including electricity, heating, industry and transportation — by that date.
In November 2021, Denmark was one of the founding members of the Beyond Oil and Gas Alliance, along with six other countries and the province of Quebec.
It made Carter curious to understand why a country so "entrenched" in fossil fuels would decide on "an end date on its fossil fuel extraction," she said. She followed her curiosity to Denmark to find out.
With many analysts forecasting fossil fuel demand to peak and start dropping by 2030, academics like Carter, concerned workers and union leaders are having conversations about what this means for jobs and communities.
There's fear among Canadian workers that the energy transition will leave them out. But some are looking internationally to Denmark and Germany for inspiration on how to adapt.
The 'ingredients' to energy transition in Denmark
Esbjerg, a town on Denmark's west coast, has long been a hub for industry in the North Sea. As its large fishing industry began to decline, offshore oil and gas development took off in the early 1970s.
Now, wind turbines and related technology make up a multibillion-dollar export industry.
Walking around the town's port, Carter found the hope she'd looked for. "The blades on these wind turbines are over 100 metres long. It's hard to imagine even the scale of them. And they're everywhere," she said.
Seeing the wind industry in Denmark first-hand was, to Carter, the promise of "what the future can be" in Canada.
She compared Denmark's energy transition to making a cake. The "ingredients" include government investment, climate and energy policy, support for workers — and importantly, "massive public engagement," she said.
Extreme heat and drought conditions in Denmark over the summer of 2018 put climate change in the spotlight, prompting protests ahead of the 2019 election. Social Democrat Mette Frederiksen won on a platform that included climate change.
The Danish government decided to revisit the upcoming licensing round to explore for oil and gas in the North Sea "in light of the elections and in light of the … public demands for climate action," said Jens Mattias Clausen, EU director for Concito, a Copenhagen-based think-tank.
At the time, Clausen worked for Denmark's ministry of climate and energy. The French oil and gas company Total withdrew its application for further offshore exploration "because of the uncertainty" the delays in licensing had caused, said Clausen.
How government helped build supply chains in wind energy
Where controversy has been a recent hallmark of public debate about energy transition in Canada, things are less polarized in Denmark, said Jesper Bank, the chief commercial officer at Port Esbjerg.
"We do not see this transition as a choice between one type of energy or another type of energy, we see this as a progression or a natural development," he said.
In 2021, 43.8 per cent of Denmark's power production was from wind electricity from both on and offshore turbines, according to the International Energy Agency. But the success of wind energy in Denmark didn't happen without help from the Danish government. Some of that came in the form of funding to build wind farms.
"That was a good way to build up supply chains," said Bank, explaining that by about 2019, the wind farm proposals no longer needed financial support because the industry had taken off.
"Then we started investing in vessels," he said. "The port started investing in more direct infrastructure for offshore wind."
Bank has toured guests from around the world through the busy port — in one week alone welcoming visitors from port associations in Poland and Baltic countries, an Australian government official and a group from the Netherlands.
Denmark has become a destination for visitors from Canada, too. Last month, employees from the Nova Scotia government visited to learn lessons as it embarks on a plan to develop an offshore wind farm by 2030 to produce green hydrogen.
Support for workers key to Danish energy transition
When Jakob Lykke was growing up in Esbjerg, his future career seemed inevitably tied to the North Sea: working in the shipping, fishing or fossil fuel sectors.
"I chose the oil and gas [sector]," said Lykke, who now works as a union leader representing workers at the port, called dockers.
Many dockers work in both offshore wind and offshore oil and gas, he said, describing them as "ready to do the job" of working in the wind sector as more work becomes available with Denmark's push to build more offshore turbines.
The "Offshore Academy" allows workers to study full time for as short as a week up to a few months, learning skills that allow them to hop between industries, all while making what Lykke calls "a decent salary."
Angela Carter noticed that oil and gas workers thought of themselves as "energy workers" and were "delighted to make that transition" to wind if jobs were available.
"If we can unlock this in the Canadian context, we can't help but win."
Worker fears of what might be lost
In Canada, there are signs of change in the oil and gas sector.
In 2022, about 126,000 people were employed in oil and gas extraction and support services, compared to about 158,000 in 2012, according to Statistics Canada.
But some Canadian workers say renewables don't currently offer the same quality of life.
"I have had offers to go work in wind farms and … [it] just wasn't financially beneficial to me to do it," said a Newfoundland oil and gas worker named Chris in an interview with Laura Lynch for What On Earth.
CBC has agreed not to use his last name to protect his job security in his role working for a company that does inspections for industry, including oil and gas sites.
Chris lives an hour outside of St. John's with his wife and young child, and normally travels across Canada for work on various industrial sites.
"Our system is based around money, unfortunately, so it really limits my ability and my drive to seek out those jobs," he said.
"Everybody keeps talking about these so-called green jobs," said Terry O'Connor, who is a heavy equipment operator on oil and gas construction projects and lives in Pemberton, B.C. "Where are they? What are they?"
How worker opposition lead to change in Germany
Making sure workers were financially supported was a crucial part of another case study Angela Carter and other academics have studied: Germany's plan to phase out coal, which started for economic reasons decades ago, before climate concerns.
After Germany signed coal import agreements with other countries in the wake of the Second World War, it saw its domestic industry rebound in the late 1950s, creating a glut quite literally piling up outside mines, said Petra Dolata, an energy historian and associate professor at the University of Calgary.
The first big protest by miners happened in 1959, said Dolata, who grew up in Germany's Ruhr Valley, a coal mining region. Workers speaking up for their job security would play a large role in the phaseout of coal in the coming decades. Between then and the mid-1960s, 165,000 miners lost their jobs, she said.
Because of public outcry, Germany made a plan to support workers.
Unions, industry and governments "sat together and talked about, 'How can you make this phaseout, this closing of mines, more socially acceptable?'" said Dolata.
The result was the creation of a "semi-public" coal company in 1969, which covered about 80 per cent of coal mines. It was based on what Dolata translates as "the German coal adjustment act."
The act mapped out a "controlled phaseout" that allowed workers at closing coal mines to find work at other mines within the company, and offered retraining to other employees.
While Germany was subsidizing the coal industry, it also invested in new economic opportunities in the region, including car manufacturing, textile factories and universities.
Energy transition not just about climate
Germany's last hard coal mine closed in 2018 and a full phaseout of coal power generation is planned for 2038 as part of the country's climate plan.
Carter says there's an economic case for Canada to invest in new industries like Germany did.
"If we know that global oil demand is declining … preparing for that and preparing communities and workers is really … an essential act to take right now," she said.
Germany's coal phaseout slowed down in the 1970s and 1980s when the global oil crisis hit, but by the 1990s things started to change.
"In 1997, the German government at the time announced that it would no longer be willing to subsidize coal the way it did before, and that really was a major turning point," said Dolata.
Again, miners took to the streets, prompting renewed government support for workers. Her father, Werner Dolata, found out that he would start his own phaseout to retirement early, at age 53. While it meant some financial loss, he was happy for the new plan, calling it Geschenk des Lebens, roughly translated to "gifted life."
Not all workers were as well protected as Dolata's father, she said. For example, women working in stores in mining towns who lost jobs as their workplaces closed.
"That's for me the interesting parallel when we even talk about Alberta," said Dolata. People who aren't directly employed in the sector may have fears or "trepidations about what would happen to a region that is so defined and identifies with one energy carrier," she said.
In January, Alberta Premier Danielle Smith called the term just transition "divisive, polarizing language." In March, the federal government released its Sustainable Jobs Plan, dropping the term just transition.
"This has become almost a moral battle.… Either you believe that we need to stop producing oil and gas or you don't," said Dolata. "That's a very different battle than saying we need to make sure that people keep their jobs."
Dolata thinks a key lesson Canada could learn from Germany is the role that unions played in negotiating with industry and government to provide support for workers.
A spokesperson with the Natural Resources Canada said the federal government plans to release its sustainable jobs legislation by the end of 2023.
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