HOT|COOL NO. 2/2023 "AI & Digitalization"

international position as a result of the special democratic organization and regulation that has made comprehensive energy efficient and made expansion of the district heating network possible. A report conducted by the center-left think tank CEVEA, 2018 concludes that the consumer-owned dis- trict-heating suppliers in Denmark offered lower prices than the privately owned suppliers. About The Danish Research Institute for Democratic Businesses: The Danish Research Institute for Democratic Business- es promotes and unites democratic companies so that the Danish business community supports an engaging democracy and becomes the solution to contemporary economic, environmental, and social challenges. We do this by producing knowledge, participating in the public debate, and creating networks in the democratic sector. About Danish District Heating: The Danish district heating sector provides 64% of all Danish households with district heating. This makes Denmark one of the countries in Europe with the most developed district heating supply networks. A large proportion of Danish district heating companies are op- erated as cooperatives. This means that the cooperative is owned by its customers and works to promote their common interests. Alongside the non-profit principle, this creates an efficient heat supply at the lowest possi- ble price for the end-user. The extensive reach of the dis- trict heating grid bears witness to the comprehensive welfare system present in Denmark. District heating is a collective solution to the provision of heating, and the benefit of this scheme is that the more households are attached to the grid, the cheaper the heating costs will be. By being both collective and efficient, district heat- ing is creating values beyond the short-term, economic ones, contributing to the importance of district heat- ing in the Danish energy framework. Today the Danish District Heating Association (Dansk Fjernvarme) is very much focused on developing and using the democrat- ic ownership-model to strengthen and broaden district heating even further in Denmark.

pliers that the price is not decisive. They are happy to pay extra to use companies where they are co-owners and can influence the companies' values and products. The rapport underlines that Danes are motivated by direct in- fluence. Many would like to make a difference in specific mat- ters of importance or get involved to achieve personal gain. And personal gain does not only have to do with money. It can also be experienced just as valuable to be part of a community, to be useful, or to gain new skills. On the downside, the report shows that over half of Danes know nothing or little about the democratic companies they are part of, and only about half know they are co-owners or members of a democratic company. This dramatically influences Danes' ability to use their democratic rights and influence the compa- nies they co-own or are a member of. And more importantly, it shows the need for democratic companies to be more proac- tive and vocal about the fact that they are democratic. Democratic companies are productive and stable. The development in productivity is an important factor in the extent to which Danish companies create growth and prosper- ity in Denmark. Common myths about democratic companies are that they are less productive and so enclosed with bureau- cracy making them unable to make decisions efficiently. These claims are, however, no more than misconceptions based on ideological and false myths. Our analysis shows that demo- cratic companies have on average, a high level of productivity, and democratic ownership does not seem to stand in the way of growth and development in the business world - it rather seems to be the contrary. Studies conclude that the produc- tivity of democratic companies meets the productivity of other companies and even, on some factors, exceeds the productiv- ity levels of other companies. Furthermore, democratic com- panies are more stable and rarely go bankrupt. Finally, studies show that democratic companies reinvest a higher percentage of their profits compared to other Danish companies. The high productivity of democratic companies is even more remarkable because democratic companies tend to be evalu- ated based on alternative factors and other advantages (social and environmental, for example). Our studies underline that not only can they be compared to other companies' productiv- ity they also exceed them in some areas. The case of the democratic district heating The conclusion above has underlined some of the advantages of democratic companies and established that prejudices stat- ing that democratic companies are unproductive or unstable are just that, groundless prejudice. Within the energy sector, turnover accounts for around a quarter of the total turnover of Danish companies. If one looks even closer into the ener- gy sector, democratic district heating plays a significant role in Denmark. The district heating sector in Denmark has a unique

For further information please contact: Magnus Skovrind Pedersen,

30 HOTCOOL no.2 2023

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