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Denmark: Higher Pollution Tax to Take Effect

(Dec. 27, 2011) For 2012, Denmark is raising taxes on pollution by district heating facilities to a level five times as high as those previously in force. While at one time it was estimated that the impact on heating bills would be only about 125 kroner (about US$22) per year, it now appears that the cost will be much higher, placing a particular burden on low-income families. (Pollution Tax to Raise Heating Bills, THE COPENHAGEN POST (Dec. 19, 2011).)

The tax is applied to nitrogen oxide, one of the greenhouse gases, which is produced during combustion. According to Kim Mortensen of the district heating association Dansk Fjernyarme, the tax “will become noticeably more expensive but the precise bill will depend on what the [local district heating] plant is powered by.” (Id.) For example, residents of the town of Brønderslev have been informed that an ordinary-sized house will end up with a heating bill increase next year of 787.5 kroner (about US$138). The district heating plant manager in that town noted that the tax will increase their costs dramatically and that “we will have to retrieve that cost from our customers.” (Id.)

Mortensen also stated that the increase will make it more expensive for customers to choose to receive heat from district plants, saying that the change puzzled him. “I thought with the government's green push that they would think that district heating was a good thing,” he added. (Id.)