Drilled There, Drilled Then, Now Denmark Paying Less
Conn Carroll /
Matthew Yglesias kicked off his new Center for American Progress blog this week with a post favorably citing a Thomas Friedman article on Denmark’s energy sector. Yglesias writes:
Denmark, by contrast, some time ago adopted policies aimed at promoting energy efficiency and conservation and, consequently, has an infrastructure that’s well-adapted to energy being expensive. Not only does that make Denmark greener than the United States but it also makes Denmark much less vulnerable to energy supply shocks than the United States is.
And it is true, Denmark is more buffeted from energy price shocks than the U.S. But not for the reason Matt states. Friedman, at least, nods towards reality in passing when he writes:
Unlike America, Denmark, which was so badly hammered by the 1973 Arab oil embargo that it banned all Sunday driving for a while, responded to that crisis in such a sustained, focused and systematic way that today it is energy independent. (And it didn’t happen by Danish politicians making their people stupid by telling them the solution was simply more offshore drilling.)
What was the trick? To be sure, Denmark is much smaller than us and was lucky to discover some oil in the North Sea. …
We don’t know what Danish politicians told their people at the time, but the facts on the ground (and in the sea) seem to indicate that a big part of the solution they sold their people on after 1973 was offshore drilling. Not only were the Danes “lucky to discover some oil in the North Sea,” unlike America, Denmark had the political will to develop those resources. Denmark now produces more 344,000 barrels of oil per day and 369 billion cubic feet of natural gas every year. This makes them a net exporter of both oil and natural gas which not only helps their bottom line, but also protects them from Russian threats to cut off natural gas supplies.
For as green as Denmark is, however, it still is not energy independent. All the money they take from oil and gas exports helps pay for the 6.5 million tons* of coal Denmark has to import every year just to keep the lights on (neither Friedman nor Yglesias bother to mention this inconvenient truth).
UPDATE: * figure now correct. Earlier version mistakenly identified coal imports by nt Btu imports.