EU leaders divided over costs as climate talks begin

BRUSSELS (Reuters) - European leaders met on Thursday to forge energy policy to cut climate-warming gas emissions in the years to 2030, but haggled over how to share out the costs of a deal.

hidden October 24, 2014 01:45:10 IST
EU leaders divided over costs as climate talks begin

EU leaders divided over costs as climate talks begin

BRUSSELS (Reuters) - European leaders met on Thursday to forge energy policy to cut climate-warming gas emissions in the years to 2030, but haggled over how to share out the costs of a deal.

The 28 member states want to set the pace for a global pact to be agreed in Paris next year with industrial powers from Asia, North America and the rest of the world.

That pact would aim to improve on two decades of stuttering cooperation and rein in carbon dioxide emissions blamed for a disruptive rise in temperatures.

There is broad acceptance of an overall EU goal of cutting carbon emissions from homes, power plants, cars, planes, farms and other sources by 40 percent by 2030, compared with the global benchmark year of 1990.

Conflict between Ukraine and Russia, the EU's biggest energy supplier, has also focused the EU on reducing its reliance on imported fossil fuels by increasing use of renewable energy and using domestic sources more wisely.

Arguments about helping poorer eastern states may drag the negotiations through the night into Friday, diplomats said, though they still predicted a deal could be achieved.

As host of next year's United Nations summit to negotiate a global climate deal, French President Francois Hollande said Europe had to take the lead.

"If there isn't an agreement in Brussels among the countries that are furthest ahead on this issue, how are we going to convince the Chinese or the Americans or the poorer countries?" Hollande said on his arrival for the Brussels talks.

German Chancellor Angela Merkel was more cautious.

"I cannot say whether there will be an agreement today," she said. "I don't think the talks will be easy, as we also need to look at our international competitiveness."

EU policymakers have sought to strike a balance between big business, which says more ambitious targets will drive away industry, and innovative companies and green campaigners, who say the outline goals lack ambition and will nip Europe's renewable technology sector in the bud.

For instance, ArcelorMittal has said the EU plans would make European steelmaking uncompetitive. On the other side of the debate are the likes of Acciona and Unilever, which have called for an ambitious set of 2030 goals to encourage EU investment.

The plan is to build on existing green policy goals to 2020, which have greatly increased the amount of renewable energy used and cut overall energy use through measures such as increased building insulation and more fuel-efficient cars.

POLLUTING INDUSTRIES

At present EU carbon emissions are nearly 20 percent below 1990 levels, helped by the collapse of polluting industries in eastern states after the fall of communism 25 years ago.

After six years of economic crisis, many states say their national budgets will struggle to cover the cost of more ambitious targets. And leaders fret about the reaction of voters to a range of related effects.

Coal-dependent Poland - whose new prime minister Ewa Kopacz is attending her first EU summit - fears the political fallout from policy that could shut mines a year before an election.

British counterpart David Cameron wants nuclear options kept open and says too much red tape will fuel Eurosceptic demands to quit the EU.

Portugal and Spain, meanwhile, are keen to export energy and have pressed for stricter targets and incentives that would push France to accept more power connections being built to link Iberia across the Pyrenees.

France has said the infrastructure is too difficult and too costly.

EU sources, speaking on condition of anonymity, said the German, French, Polish and Portuguese leaders had held separate talks with European Council President Herman Van Rompuy ahead of the debate of all 28 member states to try resolve their various concerns.

The European Commission, the EU executive, has laid out three 2030 targets: as well as cutting emissions by 40 percent from 1990, they propose green fuel should provide at least 27 percent of energy with energy efficiency improved to 30 percent.

While some nations, such as Denmark, say more efficiency will cut reliance on Russia, others point to the cost of implementing it.

Britain has led opposition to a strong energy savings goal and an updated document, seen by Reuters, on the state of negotiations put forward an energy savings target of 27 percent and underlined it would apply to the EU as a whole, not to individual countries.

Any deal agreed this week will commit governments in principle for years to come, but detailed law will only be worked out later and could take account of how far other global powers follow suit.

(Additional reporting by Alastair Macdonald, Julia Fioretti, Philip Blenkinsop, Adrian Croft and Andreas Rinke; Editing by David Goodman and David Holmes)

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