Is Denmark’s Circular Economy Too Comfortable?

Photo by Anders Mortensen on Unsplash

Denmark is known for its high levels of education and respect for nature. The country serves as an inspiration to others due to its sustainable development approach. However, while production-based emissions are in decline, consumption-based impacts remain high. This issue must be quickly addressed by the political leaders of Denmark, or its circular economy transition risks being stalled. According to the European Parliamentary Research Service, the country has made substantial investments in sustainability, innovative policies, and high levels of public-private partnerships. Denmark’s production-based impacts fell significantly in comparison with consumption-based ones, and that is becoming a cause for concern for the Danish Council on Climate Change (DCCC). The DCCC argues that Denmark’s high consumption-based climate footprint has not been adequately highlighted in the national or global sections of the climate program and its global climate efforts lacks clear objectives.

With recent policy approaches such as mandatory use of eco-labels and Total Cost of Ownership (TCO) in public procurement, streamlining pictograms, and GreenREFORM, all welcomed strategies that support the transition, overlook the importance of social aspects.

Strengths: Reduction of Production-Based Impacts

Denmark has successfully reduced its greenhouse gas (GHG) emissions by 44.7 million tonnes (Mt) between 2005 and 2023, and met its 2020 EU GHG emissions, share of renewable energy, and energy consumption targets. The 2020 Danish Climate Act intends to cut down its GHG emissions in 2030 by 70% compared with 1990 levels, and to achieve climate neutrality by 2050. In 2023, Denmark’s emissions per capita are close to the EU average, of 7.1 tonnes of carbon dioxide equivalent (tCO2e), which is a 45% decrease compared with 2005. In 2025, Climate Change Performance Index (CCPO) rated Denmark as fourth in climate protection performance and forward-looking climate policies and all future tender rounds for hydrocarbon exploration and extraction.

Furthermore, the country is shown to successfully implement several plans that account for a green transition and a circular model. Denmark published its Roadmap for Green Fuels in Transport and Industry, the National Recovery and Resilience Plan (NRRP and the North Sea Agreement (NSA) that cuts gas production and oil offshoring by 2050.

• Policy Initiatives and Sustainable Arrangements

  
  

Denmark introduced several policy initiatives at the local, regional, and national levels that show its commitment to reducing the state’s consumption and to developing environmentally friendly products through procurement.

To reduce the environmental impact of Denmark’s public consumption, the government created initiatives where public procurement and purchasing rules were adjusted to include a wider variety of eco-labelled products and more attention to lifecycle costs. Public procurement made it mandatory to sell a growing selection of eco-labelled products, where competition and price difference between products is minimal. This is mandatory only for products that are eco-labelled or contain printed matter or paper, some hygiene products, soap, and other cleaning agents, indoor painting, and standard batteries. It is also required to use Total Cost of Ownership (TCO) as an economic price parameter in state procurement for 25 product groups, and government is developing TCO tools for more procurement areas.

Denmark has also designed national streamlined pictograms, collection schemes for household waste, and sorting criteria in order to reduce market fragmentation. GreenREFORM, an integrated environmental-economic CGE model system connected to the Green national account, shows the impact on specific circular economy activities to policymakers prior to policy implementation.

The country’s business promotion programmes feature circular economy models and green technologies in collaboration with Horizon Europe and other EU instruments. Denmark outlined the Circular Economy Action Plan and the Green Transition Act, which aim to foster sustainable standards across sectors.

These sustainable standards can be encountered in Aalborg and Almere Port, where entire turbine blades are repurposed as structural components for several uses, such as for bus and bike share. Other sustainable activities are found in the projects ‘Upcycle Rows’ and ‘The Resource Rows’, where construction materials are recovered and reused in different buildings.

Denmark has created a blueprint for institutional and sustainable arrangements. The nation has the intellectual power, political might and innovative strenghts to change the current ecosystem for a decarbonised one.

Gaps: A consumption-based Predicament

The problem is those strengths are limited. They apply only to state procurement, do not fully account for social factors and gendered consumer choices, and lastly, do not yet successfully address imported consumption-based emissions nor global climate efforts to transition to a circular economy.

• High Consumption Footprint and Import Dependency

  
  

Consumption-based climate footprint includes all GHG emissions caused by Danish consumption, not just within Denmark, but abroad, in countries such as China or Germany. In 2020, it was estimated that the total climate footprint from Danish consumption was 64 milliontons CO2e, more than 50% higher than the country’s total national GHG emissions. Denmark’s material footprint is still above the EU average, and its material import dependency remains high, which accounts for its high consumption rates on food, clothing, personal care and electronics.

Current government policy is lacking when it comes to setting a target for the CO2e footprint for Danish consumption and reducing the climate footprint from public procurement. The DCCC suggested that the public procurement could be an option to reduce Dane’s climate impact and that the target should add the 70% target for 2030 and other national climate targets, not a replacement. A cause for concern lies on the fact that the government stated that its plan to achieve the 2030 targe may not be fulfilled, and that there is no current plan B for meeting the 2030 targets should plan A fail. There is a possibility that future GHG emissions increase, which is why there should be an aim for further emission reductions, but the government has not clarified what its plan of action is should that situation occur.

The government’s statements exude scepticism over their policy and decision making skills, putting its green leadership credibility to question. Without clearly set objectives that target emissions, Danish consumption footprint will continue to rise.

• Limitations within Procurement and Lack of Mandatory Tools

  
  

While the government has innovative practices such as national streamlined pictograms, collection schemes for household waste, and sorting criteria in order to reduce market fragmentation, mandatory eco-labelling of products, circular construction projects and TCO. These are limited to public procurement and reach only a small portion of the total demand. Although GreenREFORM is useful for policy-makers on which policies contribute to significant reductions in consumption-based emissions, the tool is not mandatory for use which reduces accountability in practice and success in meeting targets.

• Lack of Social Factors into the Circular Model

  
  

The government wants there to be a conversation on what it means for Denmark to become a green country, but it seems as though the government is underestimating the worst outcomes and persisting in using the same approaches. Conversations revolving around the circular economy from businesses, industry, and the government regularly highlight manufacturing methods, technological aspects, and the use of sustainable materials. Whereas furthering research on behavioural science is being given less attention.

Individuals with a higher income produce a higher climate footprint and consumption than those with lower incomes. This also suggests a high material import dependency within Denmark. Although an individual’s consumption is associated with large emissions, the Danish Council for Climate Change (DCCC), states that these two factors are not being properly addressed by its government in its climate programme. If the government wishes to achieve a just transition, then it must reshape consumption standards by addressing the importance of behavioural science and the social aspect of the circular economy, which is often not discussed.

Insightful conversations and research on values, gender, practices, and social norms tied to the circular economy, particularly the challenges that individuals feel when transitioning to circular consumption standards, must be a part of the government’s climate programme. As it is evident that a person’s everyday consumption is motivated by several social components, which then affect consumption-based impact rates. For many individuals, purchasing a piece of clothing from Shein, which comes all the way from China to Denmark, is seen as less of a burden for low-income individuals. Purchasing a piece of clothing from abroad may also reflect an individual’s lack of awareness of the consumption-based climate footprint. There needs to be a government, business and societal collaboration in order for consumers to resist single use products, by considering individuals’ interests and values in consumption and helping to modify their everyday practices.

Gender influences circular attitudes and the consumption routines, which generate imbalances that increase inequality and stereotyping unless policies are designed to avoid them. Circular solutions must be more than managing waste or technological innovations. The current government must recognise the importance of the social factors that affect people’s daily lives and their level of income, to reduce the consumption-based climate footprint. Danes must be incentivised and encouraged to adjust their preferences and routines by modifying existing behaviours and mindsets, by creating and adopting better standards that add more value to the country. The government should create national behavioural studies targeting gender, low/high-income households/earners and high-impact consumption choices such as personal care, textiles and electronics to address these issues.

• Biomass Dependency

  
  

There is a dependence in biomass within Denmark that may interfere with material use, and it needs to be addressed and consequently reduced. In order for the energy transition to occur, the government must create a fairer incentive structure where all available renewable energy sources in Denmark are given the same importance as biomass.

Endless Possibilities

Danish leadership must agree on and establish a set of objectives to meet its targets in order to find success. Denmark is close to see that success, now it needs to be bold in its pursuit with the use of legislation, policy implementation and a shared vision.

• Create a clear strategy for long-term climate goals

The government’s climate goals must show how it will achieve climate neutrality by 2045 and how capture and storage of CO2 technologies and pyrolysis will succeed.

• Set a quantitative consumption target for CO2e footprint for Danish consumption

Adopt a national quantitative target for consumption-based impacts (e.g. 50% reduction by 2035) and publish annual reports.

• Create a proper plan B

Every plan needs a carefully planned plan B. In this case, it should be put into action in case plan A fails to meet its milestones. The plan could have specific measures that would be adopted in case specific milestones in plan A were not met.

• Fund behavoral science and national social studies

Create national behavioural research programmes based on income, gender and consumption preferences, blending with procurement, subsidies and regulations.

• Expand greener public procurement beyond the state

Add green procurement targets at the regional and national level to meet CO2 targets for high-consumption activities.

• Use green research funds for measures focused on consumption

These green funds can also be used to fund for measures focused on consumption such as rental subsidies and repair infrastructure.

• Societal Commitment

Incentivise citizens to reduce single-use consumption and support circular economy initiatives.

Outgrowing the Comfort Zone

Denmark’s climate strategy has the ambition to succeed, however, there are policy and leadership plateaus that stand in its way. The country must make a joint effort, the government, business, and civil society, to take on the consumption-based impact with established objectives. With clear government arrangements, set milestones and accountability, Denmark will make history for its systemic change into a greener future.