Source: https://ieep.uk/news/blog-what-should-and-shouldnt-the-uk-take-from-the-danish-tax-on-ghg-emissions-from-agriculture/

• The Green Tripartite Agreement also includes:
  • A Green Land Fund, with 40 billion DKK aimed at setting aside agricultural land, accelerating afforestation, and peatland rewetting to support biodiversity & carbon sequestration;
  • strengthening of the regulatory framework of nitrogen discharge
  • payments to incentivise farmers to reduce fertilizer and use biochar.
• Substantial negotiations between representatives of agricultural business organisations, environmental organisations, labour unions, industry and government
• The marginal rate will be 300 DKK (about £34) /ton of CO2e in 2030 rising to 750 DKK (about £84)/ton CO2e, in 2035. Whilst this tax is expected to lead to a 4% decline in overall agricultural production, it is designed to motivate more efficient production.
• Farmers will receive a rebate for the first 60% of average emissions per animal, meaning that if a farmer is able to take advantage of developments in feed, technology and manure management to reduce the lifetime emissions of an animal to 40% less than average, they would pay no tax on that animal.
• They have tried various approaches to cut emissions, most of which have not made a lot of impact. So the tax has been argued by some as an acceptance that these previous measures have not worked and something tougher is needed.
• It also has a Climate Change Act (2008), which following a 2019 amendment also requires net zero emissions, based on 1990 levels, by 2050 and agriculture is covered by it.
• Whilst fossil fuel electricity generation has been subject to effective taxation via the UK Carbon Price Floor
• Northern Ireland’s Beef Carbon Reduction Scheme, which aims to reduce the lifetime GHG emissions of cattle, makes an interesting comparison.   It offers £75 per animal that is fattened sent to slaughter by a maximum age: 30 months in 2024 dropping to 26 months from 2027 onwards
• The NI scheme uses the carrot rather than stick, paying for reduced emissions rather than taxing excess; but whilst it might at first glance appear that NI  farmers are much better off than their Danish counterparts, it is important to consider the overall agricultural support context.
• There are also caps on the number of animals eligible for payment at 352,000 per year for the whole of Northern Ireland.
• Quick fattening and early slaughter is the only way for NI cattle farmers to benefit from the scheme.
• The impact of feed production is also out of scope in the Danish Tax. Whether the tax will incentivise increased feed use (as an attempt to reduce on farm emissions via earlier slaughter) or reduce it by lowering livestock numbers should be monitored as should the consequential whole-system greenhouse gas impact.
• The Danish Tripartite Agreement has been criticised for setting the effective rate too low (less than half that of other industries); its reliance on relatively untested technologies to reduce emissions per animal; the lack of an overall systems approach; and for not being ambitious enough on nitrogen to meet the Water Framework Directive targets for 2027.

AI suggested related notes

These notes appear semantically similar based on Smart Connections embeddings:

• Jacobs et al., 2022 (similarity: 64.1%)
• Manure from animal agriculture (similarity: 62.1%)
• Denmark’s Agricultural Transition Policy– Fiscal Mechanisms for Plant-Based Sector Development (Rethink Priorities) (similarity: 61.7%)