‘New green deal’ to cost extra €175bn year by 2020, says EU

EU environment chief Stavros Dimas has revealed that by 2020, an extra €175bn will need to be invested every year to reduce global emissions.

Half of this money will be dedicated to helping developing countries reduce emissions.

At the launch of the commission communication on how to finance a successor to the Kyoto protocol, Dimas said, “This is a new green deal that will tackle the economic crisis and lay the basis for a low-carbon economy in the future.”

But he cautioned that if countries do not stick to the terms of the EU’s €200bn financial stimulus plan – which includes a commitment to investing in energy efficiency and clean technologies – a global climate agreement to succeed Kyoto will not be possible. “No money, no deal,” he warned.

The EU has already committed to reducing its greenhouse gas emissions to 20 per cent below 1990 levels by 2020, or 30 per cent if a global climate deal is agreed. The commission’s plan suggests that developing countries also reduce emissions by 15 to 30 per cent below “business as usual” levels by 2020.

But industrialised countries should continue to take the lead on reducing greenhouse gas emissions, and targets for each country should be decided based on GDP per capita, current emissions, population trends and past emissions – the most “fair” way to ensure comparable efforts are made by everybody, says the EU.

The €175bn to fund the reductions could be generated by linking countries’ contributions to their GDP and emission levels, or by auctioning permits within an emissions trading system.

However, environmental and aid groups have come out against the proposal, saying that it backtracks on previous promises – earlier versions of the proposal had included a commitment to spend €30bn a year on developing countries by 2020.

“The commission has come up with a decent blueprint, but has shown it is unable to put its euros where its mouth is and support credible amounts of aid to prevent a global climate catastrophe,” said Joris den Blanken, Greenpeace EU climate and energy policy director.

Greenpeace is calling on industrialised countries to pledge a total of €110bn a year in assistance, and for the EU to dedicate €25bn on top of its current aid commitments.

Friends of the Earth, meanwhile, argues that the EU should commit to a 40 per cent emissions reduction target. Climate campaigner Esther Bollendorff says, “Europe accounts for 30 per cent of developed countries’ emissions and 22 per cent of global GDP – for these reasons it must live up to its responsibilities and commit to adequate action at home.”

The commission’s text is the first position paper the EU has released in the run-up to the crucial UN climate conference in Copenhagen this December. It will still have to be agreed by EU leaders in March at the spring summit.

Dimas also wants the EU to lead on creating an OECD-wide carbon market by 2015, linking all national emissions trading systems. It should be expanded by 2020 to include emerging economies, he said.

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