Pioneering greenhouse policy.

Something is rotting in the state of Denmark. It is called biomass, and is mostly made up of manure, straw, and wood chips. Local farmers in a northern province of the Jutland peninsula dump it by the truckload into a cooperatively owned biogas plant - a large, closed tank that siphons off the combustible methane that evolves from natural bacterial decay. Along the way, the farmers are getting energy from a clean (if somewhat unsanitary) energy source and making extra money as well. Government subsidies for this project are just one of the ways a couple of small European nations are leading the industrialized world toward sustainable energy policy.

When global temperatures rose noticeably in the late 1980s, renewing fears of long-term global warming, both the Netherlands and Denmark were quick to respond. The Netherlands declared its intention to cut domestic carbon dioxide emissions 5 percent by 2000, and Denmark announced that it would aim for a 20 percent reduction by 2005 and 50 percent thereafter. Germany and several other European countries have also announced reduction targets, but Denmark and the Netherlands have actually translated their goals into comprehensive plans and begun implementing them.

Certainly, these small countries have an easier time changing policy directions than do heavyweights like France and the United Kingdom. Their total populations (15 million Dutch plus 5 million Danes) only slightly exceed the combined tally for the capital cities of Paris and London, and are relatively homogeneous in terms of income and cultural origins - which tends to minimize social divisions, promote a productive relationship between citizens and the government, and foster a national sense of community that is essential for addressing tough, long-term problems.

In the Netherlands, a widespread awareness of environmental limits also seems to have spurred government activism. After decades of industrial development, the Dutch have come too late to realize that their landscape, with more people per square kilometer than any other European country - and probably more chemical plants, oil refineries and pesticide-intensive farms - has become the most polluted in Western Europe.

Since energy comes in so many forms, and is used in so many ways, no single policy measure, unless draconian, could possibly suffice to reverse a historical climb in national carbon emissions. Recognizing this, both the Danish "Energy 2000" plan, introduced in 1990, and the Dutch "National Environment Plan" (NEP), first presented in 1988, aim to reshape every aspect of energy use, from the initial choice of fuels to their ultimate use in buildings and motor vehicles.

On the supply side, both countries plan to continue increasing their use of domestically produced natural gas, gradually replacing more carbon-intensive coal. The Danish government also says it will continue to encourage the development of biogas - a renewable source that adds essentially no new carbon to the biosphere.

And the popularity of wind turbines, a clean and increasingly economical energy source, should soar. To encourage the growth of wind and other alternative types of electricity generation that traditional utilities are often slow to explore, both governments have invited outside companies into the electricity business, ending decades of monopoly protection for the power-generating industry. The Netherlands hopes that utilities and independent producers together will have installed 1,000 megawatts of wind capacity by the year 2000. Denmark plans on 1,500 megawatts by 2005, enough to generate a tenth of its electricity, compared to 3 percent today.

The two countries are also supporting the aggressive growth of cogeneration, an efficient technology that simultaneously generates electricity and heat. A standard fossil fuel power plant discards huge amounts of heat (usually all but 33 percent of the heat energy released in combustion), pumping it into the air as steam, or into a nearby river as hot water, disrupting downstream ecosystems. At the same time, thousands of people in the region will buy additional energy to heat homes, offices, and factories. A cogenerating plant eliminates this tremendous waste by supplying its leftover heat to nearby factories, or to whole neighborhoods via underground pipes. If half the heat is put to good use, the overall efficiency of cogeneration doubles to a typical 66 percent. If most of the heat can be used, 90 percent efficiency is possible.

But the cheapest carbon emission reductions may come from improving the energy efficiency of buildings. In both the Netherlands and Denmark, regulators have proposed insulation requirements for new buildings that would add little to construction costs yet reduce heat demand significantly over many decades. Similarly, they have written rules requiring that new electrical appliances, such as refrigerators and dishwashers, come with efficiency rating labels, and eventually meet tight efficiency standards. Designed for efficiency from start to finish, the new appliances should cost about the same as current ones, while often using only half the energy and saving hundreds o dollars in electricity over their lifetimes.

Improvements on a number of fronts can combine for even greater overall savings. For example, compared to a coal-fired electric plant powering an average refrigerator, a cogenerating natural gas plant running an energy-efficient refrigerator would use a third of the energy and emit a quarter of the carbon dioxide. If the cogenerating plant burned biogas, net carbon emissions would fall to zero.

Unfortunately, transportation - the fastest and most relentlessly growing source of carbon dioxide - seems to defy such straightforward technological fixes. Denmark and the Netherlands can exercise only limited influence over the large foreign manufacturers who supply the lion's share of their cars, trucks, and buses. Until they, like Switzerland (see "Jump Start" in this issue), commit seriously to fostering a new clean car industry, they will have to focus less on changing how motor vehicles are made than on how they are used.

The Netherlands, with the world's highest density of motor vehicle ownership (except for the city-state of Singapore), has historically taken strong steps to curtail car use, by heavily taxing gasoline and working to make bicycling and train commuting more convenient. Continuing in this tradition, the Dutch government is now proposing an expansion of its strong bike path network, an increased long-distance public transportation service, and revised zoning regulations that would coordinate new development with public transportation planning.

The greatest danger facing "Energy 2000" and the NEP is that world energy prices will remain low enough to negate many of the voluntary incentives for cleaner energy use. Cheap coal could make wind turbines and cogeneration uncompetitive. Cheap oil will only encourage driving. As a result, the success of the national plans may ultimately depend on their governments' willingness to raise fuel prices through new energy or carbon taxes.

Here the countries' sizes will hamper effective policy rather than help it. Small, developed countries tend to specialize in a few types of industry, trading their wares on the international market for goods they do not produce themselves. And a country that depends heavily on exports must be particularly wary of raising the cost of doing business within its borders, to avoid putting domestic industry at a disadvantage against foreign competitors.

In the Netherlands, the current centrist government has essentially sidestepped this difficult dilemma by assuming that international energy prices will rise substantially over the next decade and obviate the need for taxes - a projection that seems unrealistic. In Denmark, a new and more progressive government has pushed hard but unsuccessfully for the European Community (EC) to adopt a uniform energy and carbon tax - putting all EC member states on a level playing field - and to offset it with other tax cuts. Until recently, the EC countries seemed willing to implement an energy tax, but only if their major global competitors, particularly the United States, levy similar taxes at the same time.

At last year's Earth Summit in Rio, leaders of the major West European powers publicly criticized the United States for hindering international attempts to confront the global warming threat, and particularly for refusing to cooperate on taxes. But cynics accused the Europeans of taking secret comfort in the United States' obstructionism. Now that President Clinton has proposed his own energy tax, and has committed to stabilizing greenhouse gas emissions in the United States, the Europeans can no longer so easily blame the Americans for their own continuing inaction.

A year after the Rio conference, the large European powers have yet to prove the cynics wrong by matching their admirable goals with tangible deeds. Perhaps they should look to their smaller neighbors for inspiration.