Denmark will impose a carbon tax on livestock farmers for the greenhouse gases emitted by their cows, sheep, and pigs starting in 2030. This makes Denmark the first country in the world to implement such a tax, targeting a major source of methane emissions, one of the most potent contributors to global warming.

The goal is to reduce Denmark’s greenhouse gas emissions by 70% from 1990 levels by 2030, according to Taxation Minister Jeppe Bruus.

Beginning in 2030, Danish livestock farmers will be taxed $43 per ton of carbon dioxide equivalent, a figure that will rise to $108 by 2035. However, a 60% income tax deduction will bring the actual cost per ton down to $17.3 initially, increasing to $28 by 2035.

While carbon dioxide is often highlighted for its role in climate change, methane traps about 87 times more heat over a 20-year period, according to the U.S. National Oceanic and Atmospheric Administration.

Methane levels, released from sources like landfills, oil and natural gas systems, and livestock, have risen sharply since 2020. Livestock accounts for approximately 32% of human-caused methane emissions, reports the U.N. Environment Program.

“We will take a significant step towards becoming climate-neutral by 2045,” Bruus stated, adding that Denmark “will be the first country globally to introduce a real CO2 tax on agriculture” and expressed hope that other nations would follow suit.

New Zealand had enacted a similar law scheduled to take effect in 2025. However, the legislation was removed from the statute book on Wednesday following substantial criticism from farmers and a change in government at the 2023 election, shifting from a center-left ruling bloc to a center-right one. New Zealand announced its intention to exclude agriculture from its emissions trading scheme and explore alternative methods to reduce methane.

In Denmark, the agreement was reached late Monday between the center-right government and representatives from farmers, the industry, unions, and other stakeholders. It was presented on Tuesday.

Denmark’s action follows months of protests by farmers across Europe against climate change mitigation measures and regulations that they claim are pushing them towards bankruptcy.

The Danish Society for Nature Conservation, the largest nature conservation and environmental organization, characterized the tax agreement as “a historic compromise.”

“We have managed to reach a compromise on a CO2 tax, which sets the stage for a restructured food industry – even beyond 2030,” said Maria Reumert Gjerding, head of the organization, following the discussions in which they participated.

A typical Danish cow produces 6.6 tons of CO2 equivalent annually. Denmark, a major dairy and pork exporter, will also tax pigs, though cows emit significantly higher emissions than pigs.

The tax requires approval in the 179-seat Folketing, or parliament, but the bill is expected to pass given the broad-based consensus.

According to Statistics Denmark, as of June 30, 2022, there were 1,484,377 cows in the Scandinavian country, representing a slight decrease compared to the previous year.