Netherlands, Denmark and Estonia lead Europe's energy transition

13 July 2022 4 min. read
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The Netherlands is leading Europe’s energy transition, according to a new benchmark by Oliver Wyman, with Denmark and Estonia hot on the heels of the Dutch.

As the world pushes to decarbonise its economies, Europe is looking to play a leading role. The European Commission's Green Deal policy programme of 2019 named climate action as the number one priority for the European Union, for example, with the goal of becoming the first climate-neutral continent by 2050.

In the years since, most European Union member states have boosted their renewable plans, putting them on course to cut fossil fuel use this decade.

At the same time, the headwinds of the last three years have spurred, not derailed their green transition. Of the EU’s 27 member countries, 17 have increased their plans to increase renewable energy since 2020, according to think tanks Ember and the Centre for Research and Clean Air. If achieved, the countries’ latest plans would see 63% of EU electricity produced from renewables by 2030.

That could in turn lead to a drop in EU fossil fuel-based power generation to 595 terawatt hours in 2030, down from 1,069 terawatt hours in 2021.

Overall index results

Now, new research from Oliver Wyman has revealed the European nations – in and out of the EU – driving that transition. The management consultancy benchmarked 29 countries across Europe, weighing up their progress made in the transition towards environmental sustainability. The firm scored each country in the categories of overall economy, nature, manufacturing, utilities, waste, buildings, and transport.

With an overall green transition index (GTI) score of 53.7 out of 100, Scandinavia performed strongest in terms of nature – rating 68.3 for protected land, organic farming, its policies on water exploitation, air pollution and particulates. However, its dependency on oil meant that utilities still lagged behind on a score of 36.1. Even so – this still saw the region outperform Western Europe – its closest rival – by some distance.

Scored an overall 53, Western Europe’s highest rating was 74.7, for manufacturing – due to its policies on emissions intensity, energy intensity and hazardous waste intensity – while utilities rated a lowly 30.4.

On an individual basis, however, it was a country from Western Europe which topped Oliver Wyman’s findings. The Netherlands scored a 57.4 GTI rating. The Dutch performed strongest on the grounds of waste management – rated at 75.2 – due to its policies on waste generation of households, its high circularity and recycling rate, and approaches to landfill and waste disposal.

Utilities category results

Meanwhile, the Netherlands also scored a higher rating than average for utilities, relating to renewable and transition technologies, of 52 out of 100.

Researchers from Oliver Wyman noted, “In waste, the Netherlands achieved the highest score in circularity rates (defined as share of material recycled and fed back into the economy), while the country ranks fifth in municipal landfill waste per capita. Decisive government action has laid the foundation for this success: Already in 2016, the Dutch government had set the target to achieve a 100% circular economy by 2050, by 2030 the country wants to achieve a 50% reduction in raw material consumption.”

Further reading: The view on sustainability in Dutch boardrooms (in 5 charts).

Economic power

Countries were not only lauded on the basis of where their transitions were, however. While Norway are seen as one of the continent’s top 10 in terms of its overall green transition index score, it was found to be ‘underperforming’ by Oliver Wyman, alongside Luxemburg and Ireland, as its higher rate of GDP per capita had not been used to help its green transition.

GDP per capita vs Overall GTI Score

In contrast, while Italy ranks lower on the GTI list, it is seen as over-performing on the basis of its lower GDP per capita. Similarly, Estonia, which is ranked third overall, is the most remarkable of these over-performers.

Oliver Wyman noted that Estonia performed especially strongly in the economy category. There, Estonia achieved the highest score, by reducing absolute GHG emissions and primary energy consumption over the 2015-2020 timeframe, while it ranks second in the share of value-added in the environmental goods and services sector, as percentage of total country value-added – meaning it is building its future economy around green produce.