The construction sector is central to the green transition, and Denmark has introduced CO₂ requirements for new buildings in the form of a limit value that is expected to be gradually tightened in the coming years. However, unlike in other sectors, where CO₂ regulation typically takes the form of a tax or price, there is currently no standardised way to assess and compare the socio-economic consequences of such requirements in construction.
In the Plena Imago project, Copenhagen Economics has developed a new model to address this gap. Combined with GrønREFORM, the model links detailed industry data with macroeconomic modelling, enabling analysis of impacts from the individual building level to the Danish economy as a whole. The model is designed as an analytical tool and does not recommend specific limit values or phase-in timelines, nor does it assess individual building materials as ‘good’ or ‘bad’.
The report analyses three scenarios with gradually stricter limit values compared to a baseline without tightened limits. Under the first scenario, additional costs are limited to below DKK 100 per m² in 2027, corresponding to less than 1 per cent of construction costs. In the stricter scenarios, costs increase substantially, reflecting the need to adopt more expensive construction materials to comply with lower limit values.
Overall, the report finds a trade-off between the ambition to reduce limit values markedly and quickly on one hand, and socio-economic costs on the other. Both the limit value and the pace of implementation matter. To our knowledge, this is the first time this relationship has been analysed and estimated.
The study was commissioned by Bygge- og Anlægsbranchens Samarbejdsfond (3F Byggegruppen and Dansk Industri), NCC, Rockwool, and TopDanmark.
The analysis estimates the business and socio-economic consequences of different scenarios for stricter CO₂ requirements in new construction, based on a model linked to GrønREFORM and applying standard socio-economic modelling principles. It does not take a position on the appropriate ambition level, recommend regulatory choices, or include the benefits of reduced climate damage, lower pollution, or other environmental effects.
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