Focusing On The Future
BY HELEN HERNANE-PALAPAG
SUSTAINABILITY IS THE NAME OF THE GAME. DANISH AMBASSADOR FRANZ-MICHAEL MELLBIN EXPLAINS HOW OUR COUNTRIES’ DIPLOMATIC RELATIONSHIP COULD HELP ACHIEVE CLEANER AND CHEAPER ENERGY FOR THE PHILIPPINES.
Three years ago, Denmark’s Parliament passed a Climate Act that aims to reduce the country’s greenhouse gas (GHG) emissions by 70 percent below 1990 levels in 2030 and net zero emissions by 2050. In addition, Denmark also aims to phase out fossil fuel production within three decades.
“[These] are enormous, ambitious goals. And 2030, that’s like ‘tomorrow’ in the energy world because energy takes time to build,” Mellbin says. He further adds that their country is working on building a massive amount of additional renewable power production; plus energy savings and electrification.
This strategy will result in “a very flexible energy system.” What ensures their plan’s success, Mellbin notes, is that Denmark implements sector coupling. This energy technology buzzword means integrating the renewable power production sector (solar, wind, biomass, geothermal, or water) with the energy-consuming sector—commercial and residential buildings (cooling and heating); transport and mobility; and industry, trade, and commerce.
It aims to address the major problems that the renewable energy sector encounters—consistency and storage. Energy generation varies between seasons, with the output being too much or too little and lack of storage facilities mean loss of excess energy or lack of supply during downtimes. Sector coupling could offset these supply shifts and by using “Power-to-X” technologies, excess energy could be directed to power various sectors.
“It’s not just about focusing on [one energy-consuming sector]. It’s taking a societal view of how do we build a more efficient energy system,” he explains, further adding that Denmark has the lowest cost of electricity among the Organisation for Economic Co-operation and Development (OECD) countries—a 38-member intergovernmental organization focused on stimulating trade and economic progress.
“We pay a lot of taxes, but [energy] production cost is the lowest [among the OECD countries]. As an example, I have a 200-square-meter apartment in Copenhagen. It’s very energy efficient and I admit that not everybody will have that situation. I pay $15 per month for hot water and heating and it’s a very large apartment. My bill was so little that when I first received it I thought it was a mistake and they’ll tell me to pay thousands of dollars at the end of the year. But they actually gave me back $3 by the end of the year, I was amazed! That’s how cheap it could be when you do sector coupling and do [energy systems] right,” the ambassador shares.
CLEAN ENERGY FOR THE PHILIPPINES
Currently, renewable energy contributes around 22 percent of the country’s energy mix. The Philippine government aims to increase this to 35 percent by 2030 and to 50 percent of our portfolio by 2040.
In order to achieve this, the Department of Energy (DOE) has partnered with the Danish government and Copenhagen Infrastructure Partners (CIP). Founded in 2012, CIP is the world’s largest fund manager dedicated to supporting renewable energy investments all over the world. Earlier this year, CIP Associate Partner Przemek Lupa signed three offshore wind energy service contracts with DOE Secretary Raphael Lotilla. Ambassador Mellbin witnessed the event which marked the first time a renewable energy (RE) project fully owned by a foreign company pushed through since it was allowed by the Philippine government in 2022.
“The Philippines is very fortunate because you have a lot of renewable energy options. Unfortunately, due to lack of action, you still have difficulty when it comes to generating electricity and there are still millions of Filipinos with no access to electricity,” Mellbin stresses. According to 2021 World Bank data, approximately 2.85 million Filipinos have no access to electricity.
“Not only that, but everybody is paying a lot for electricity. So the country needs more energy generation capacity. The advantage for the Philippines is you can do offshore wind energy, solar, biomass, waste-to-energy, biothermal, and hydro. There are a lot of renewable energy options and by combining these energy sources, you can build a very robust, resilient energy system that is reliable on your country’s own sources and delivers energy at a much lower cost.”
Mellbin cites a World Bank report that shows the country has the potential capacity based on offshore wind alone to generate roughly 178 gigawatts (GW) of energy, which is more than the country consumes annually. In 2021, the country consumed 106.12 GW of electricity.
“Of course, you’re not going to plaster the whole sea with windmills, and it’s going to be less than what you could expect but the potential is huge. And again, the big advantage of the Philippines is you could combine various sources. So I’m quite optimistic when it comes to renewable energy in this country and what it could mean for Filipinos—both when it comes to accessing energy and also [having electricity at] a more affordable price,” the ambassador adds.
As the world leader in wind energy, Denmark has plenty to offer the Philippines when it comes to wind energy advancements. Technology-wise, their country has developed improvements that could be applied here. First, offshore wind energy generation means less land consumption. Generation costs have also decreased because they have made their turbines larger. With a total height of around half a kilometer, these massive structures are able to harness wind energy better.
Mellbin puts simply: “When it comes to wind energy, size matters. The biggest windmills will win because they generate more power from wind [energy].”
Another factor that helps decrease production cost, the ambassador shares, is the longevity of the windmills. Originally, their data projected that their offshore turbines would last up to 15 years only. But their latest data reveals that these windmills at sea could easily last up to double that lifespan.
The offshore wind energy projects will be located in Camarines Norte and Sur; Northern Samar; Pangasinan; and La Union, and are expected to generate over 4,500 jobs. Danish investment firm CIP is looking to invest around US$5 billion in these projects. Aside from the financial support, however, the ambassador underscores that the company’s expertise and knowledge on successfully building and running wind farms are far more important. This increases the potential to reel in more foreign investors as they feel more comfortable with CIP at the helm.
“The Philippines has a great future and Denmark wants to be a strong partner in shaping that future. We believe that we can work together in a wide range of important areas,” Mellbin says.
MAKING DIFFICULT DECISIONS
Denmark is the second happiest country in the world, the 2023 World Happiness Report reveals. Nordic countries occupy most of the top ten slots, with Finland in the lead and trailing behind in third place is Iceland, Sweden in sixth place, and Norway in seventh place. Scandinavian countries figuring most in the list begs the question: What is it about their culture that makes people so happy?
“I’m very unhappy that we’re not the happiest. We have to do something about that,” Mellbin quips, their signature Nordic dry humor shining—or rather, seeping—through.
In all seriousness, however, the ambassador cites trust as one very important factor behind the “happiness” in Denmark, and in the region.
“Level of trust in Denmark is extraordinarily high. Having trust reduces daily friction; you can turn your back to your neighbors and strangers and expect that bad things will not happen. A deal is a deal to a very high degree and we trust our politicians to act in our best interests,” Mellbin stresses.
Highlighting their culture further is the discussion on the debt ceiling. Denmark and the United States (US) are the only two democratic countries in the world that have a fixed debt ceiling inscribed into their constitutional laws. While the US Congress recently scrambled not to default before ultimately deciding on a debt ceiling of US$31.4 trillion, their Danish counterpart has never encountered any problems.
Denmark only increased their debt ceiling once, in 2010, because of the 2008 recession. However, the parliament fixed the ceiling at such a high level that there is virtually zero political impact and would never incite any debate. The current Danish debt ceiling is fixed at DKK2,000 billion (Danish Kroner), triple their actual outstanding gross debt which is roughly DKK658 billion. In comparison, the US national debt stands at around US$30.1 trillion, leaving only a small margin between its ceiling and its actual debt.
Why is it so simple? Denmark’s general societal trust extends to a high level of confidence in their institutions government, judiciary, police, and healthcare industry. In the 2022 Corruption Perceptions Index (CPI) by Transparency International, Denmark tops all countries with a score of 90 out of 100. Trailing behind in the 2nd place with a score of 87 are Finland and New Zealand. The Philippines, however, ranks in the 116th place with a score of 33 out of 100.
Secondly, he adds, their welfare systems ensure that nobody falls behind too much that they cannot or it’s impossible to recover. Lastly, over time, they’ve created a society that highly values social peace.
“We can look at politics as an example. In a lot of countries, there is a very antagonistic relationship between various parties and political opinions. In Denmark, all big political decisions are made by the vast majority of the public. The compromise culture is very high and that is driven, I believe, by this very high desire for social consensus. This makes people feel very comfortable and allows people to live the life they would like to live which is becoming increasingly important,” Mellbin explains.
All over the world, the youth, he adds, is greatly impacted by social media because they want their self-reflection to be accepted and reflected. They want to build their own identity and in Denmark, people can create the life they want and it doesn’t matter, unlike other countries where a person’s identity is a difficult discussion that sparks even bigger conflict.
As Aarhus University Political Science Professor Gert Tinggaard Svendsen puts it, flipping the oft-quoted Vladimir Lenin phrase: “Control is good, but trust is cheaper. Trust pays off, pure and simple, so wherever trust can replace control, it should be used.”
Mellbin credits their country’s “stable politics” which allows them to make difficult decisions, saying: “As a society, one of the reasons why Denmark has been so successful over the last 30 years is because they did a lot of structural reforms. Structural reform is always the worst because it’s about sticking your hand in the hornet’s nest. But we’ve had a long rule of different governments who have made enormous compromises about structural reform which precedes crisis. We anticipate where the world’s moving and adjust policies to meet those needs.”
It was never rainbows and sunshine, however, the ambassador admits. “When I was young, they were very bad at structural reform and politicians sort of pushed away the problems in front of them or closed their eyes. But we had this sort of awakening as everything was going haywire in the 80s which led to a sea of change in political thinking and it has stayed with our politicians to this day.”
BETTER INTERNATIONAL RELATIONSHIPS
Tensions are rising all around the world. In Europe, the Ukraine-Russia war rages on with no clear end in sight. If anything, recent events have only ignited further conflict. The North Atlantic Treaty Organization (NATO) Summit in Vilnius, Lithuania recently ended with one of the key outcomes being increased support for Ukraine. In addition, Russian President Vladimir Putin emphasized their country’s resistance against Western sanctions and provocations, and strengthening ties with the member states of the Shanghai Cooperation Organization (SCO), which includes China and India.
Danish Foreign Minister Lars Løkke Rasmussen said that Denmark would like to host peace talks between Russia and Ukraine in the near future, urging certain countries (such as India, China, and Brazil) to participate.
On another side of the globe, the South East Asia (SEA) region is also facing a territorial crisis but of a maritime nature. On July 12, 2016, the United Nations Convention on the Law of the Sea (UNCLOS) arbitration ruling voted in favor of the Philippines when it comes to our country’s ownership over the West Philippine Sea. Despite this ruling, China has continued encroaching on the Spratly Islands and Scarborough Shoal.
“There are a lot of things that need to be done and need to be changed [in the SEA region]. I think the most important is that the countries find a better way of engaging with each other. You could have better dialogue and less action. One of the problems that we’re seeing in Asia today is that people are taking irreversible steps and making it very difficult to meet each other at the negotiation table,” Mellbin says, also lamenting China’s actions to ignore the UNCLOS ruling.
“Our country can do its part by upholding and supporting the rule of law amongst the nations. Because abiding by international law is the best way you can create a stable, predictable world order. For a lot of countries, especially small countries like Denmark and the Philippines, it is very important that we can rely on these internationally agreed rules.”
Mellbin adds that Denmark can support the Philippines in other ways, such as sending naval vessels and engaging in multilateral deals to boost trade and global cooperation. The ambassador, however, recognizes that while the Marcos administration has come out with a clear statement of being “a friend to all, [an] enemy to none,” the Republic of China has not shown equal goodwill.
“The pathway was clear: [for the Philippines] to have a better relationship with everyone. Unfortunately, that didn’t work out quite the way that the Marcos administration had hoped for and intended. Now it depends on the tools the Philippines has in its toolbox. You don’t have a strong, naval presence, or a strong coastguard. With these encroachments, it’s natural for your country to seek out a larger, stronger partner to support itself,” Mellbin explains.
He clarifies, however, that militarizing conflicts is not the only tool in the toolbox, and doing so could be even dangerous. But he empathizes with the country’s decision to push for closer, strategic relationships with the United States (and other global giants) because our government is hardly receiving a positive response on any level of dialogue.
With decades of diplomatic experience under his belt, Mellbin is all too familiar with international conflicts. In 2016, Mellbin, who was then the European Union (EU)’s special representative for Afghanistan, brokered a peace agreement between the Afghan government and Hezb-i-Islami. Led by Gulbuddin Hekmatyar, the country’s second-largest militant group signed an accord with former Afghan President Ashraf Ghani to abandon violence.
"I was traveling to the major capitals—Washington D.C., Moscow, Beijing—to ensure everyone’s backing [of the peace agreement] when I suddenly got a call from Kabul telling me the deal I had facilitated was off. It was a terrible blow, but by chance, I knew where to find the person responsible for the breakdown and we met on neutral ground. I have never been better prepared and it was tough. I was down to my very last argument: ‘Do you want to go down in history as the man that stood between the Afghan people and peace?’ That sealed the deal; I could hardly believe it,” Mellbin shares.
“Peace is the most important thing we have. That agreement showed the Afghan people that peace is possible and it paved the way for a ceasefire during Eid with the Taliban. In spite of many being skeptical back then, it is still the longest-standing peace agreement in modern Afghan history—which sadly says a lot about how difficult it is to end conflict in the region.”
The University of Copenhagen alumnus has received numerous awards for his diplomatic efforts, most notable of which are the Ghazi Wazir Mohammad Akbar Khan Medal, the Grand Cordon of the Order of the Rising Sun, Order of the Dannebrog, and the German Honour Cross in Red.
While he takes pride in the recognition he has received throughout his career, Mellbin shares that the best part of his work is meeting some of the most talented, smart, innovative, creative, and interesting people in the world.
“I cannot stress enough what a tremendous privilege it is to be an ambassador. You learn so much and understand the world better. On the other hand, the challenge is, because I’m introverted, I’m so often drained of energy by the evening because being an ambassador means engaging and meeting new people all the time. By the way, an interesting fact is that most senior diplomats are introverts,” Mellbin reveals.
Having been a lawyer, an employee of Denmark’s Ministry of Taxation, and a University of Copenhagen professor teaching human rights and constitutional law, the ambassador boasts a wealth of experience even prior to joining the Danish Foreign Service in 1985. But despite the challenges it presents to his introverted nature, he would never trade his work for anything else.
“An embassy is a microcosm of all the wide-ranging interests and ambitions of your country. And Denmark is very ambitious. While there is no typical day for an ambassador, I focus my daily work on ensuring that our embassy is an agent of change for the benefit of Denmark and the Danish people. We are not onlookers; we are movers. We do not analyze what is happening. We analyze how to make things happen,” Mellbin ends.