04/03/2013 10:30 GMT | Updated 04/05/2013 06:12 BST

What Happened to Denmark's Green Credentials?

Denmark, a country that despite its small size and population, continues to be seen as a world leader on sustainable development, green growth, energy efficiency and bold carbon reduction plants. The country was once a world leader in both offshore and onshore wind power, and marine energy; today they only remain a world leader in onshore wind. But nevertheless, in Vestas they have the largest wind turbine manufacturer in the world who undertake operations globally, their main rival German Siemens Energy, also have their headquarters in Denmark. This results in a lot of global interest in Denmark. Global economic giants like China, South Korea and the USA are building up business ties with the Scandinavian minor due to its expertise in green growth.

Therefore it was quite astonishing to see that in Denmark's new growth plan, which was unveiled last week by Prime Minister Helle Thorning-Schmidt, that it would cut CO2 tax on electricity and also ease other green taxes.

This has been criticised by several MP's within the coalition ,that apart from the Social Democrats, includes The Socialists Peoples Party and The Radical Left. The Green think thank Concito are also critical to the proposals of which it says will increase Denmark's CO2 emissions.

This comes in the wake of the problems with the European Union's Emissions Trading Scheme (ETS) in which the carbon price is far too low, at around €5 per tonne emitted for the scheme to be effective. Connie Hedegaard is pushing for a reform in the EU, but as I recently wrote about, they are up against stiff opposition from climate-intensive Poland. Denmark has been one of EU's strong allies on climate policies, and have worked closely together with Hedegaard on increasing the EU's emissions target from 20% to 30% by 2020, but the latest announcements by Denmark are unlikely to be either helpful or endorsed by her and her team.

Denmark has shown that growth should not happen by sacrificing the environment, and that you can have sustainable growth and still protect the environment. Countries like the United Kingdom oppose this and favour going down the dirty gas route with it's dash for gas, it's tax breaks for oil and gas companies, and it's support for carbon-intensive industries. Denmark should continue to innovate, lead on green growth and show a sustainable business model, not back away from it. More importantly it must show that a fossil fuel economy is not a viable economic model, but a green economy is; Denmarks new growth plan unfortunately does not indicate this.

This has been cross-posted with A greener life, a greener world.