Policy Focus

EU moves towards climate deal despite industry pressure

The EU is inching towards a common position on climate change following a highly controversial vote today on the EU’s emissions trading scheme.

MEPs in the environment committee adopted a report on the emissions trading scheme (ETS) drafted by Irish centre-right deputy Avril Doyle, who described it as a “very balanced position”.

“All we are asking is that there is a reduction in fossil fuel emissions at the least cost to industry,” she told reporters shortly after the vote.

“There is now a platform for negotiation...the main message here is the overwhelming support that my compromise line took.”

The report, which was adopted with 46 votes in favour to 20 against, with one abstention, proposes a complete auctioning of permits for power generators from 2013, meaning that they will have to buy permits for all the CO2 they produce.

However, for certain energy-intensive sectors, the report proposed the less drastic measure of introducing 15 per cent auctioning in 2013 to eventually 100 per cent by 2020.

Doyle said that while the EU had a duty to lead on climate change, it also had to take into account competition from those industries outside Europe which are not subject to these emissions regulations.

“I want to ensure that if any energy-intensive sectors are exposed to competition through carbon leakage, that they have protection,” she said.

UK Green deputy Caroline said that the result of today’s vote showed an assertive European parliament taking action despite pressure from business.

“We are relieved that it preserved the crucial principle of allocation by auctioning, whereby industry must pay for the right to emit.

“The environment committee today recognised the issue of carbon leakage, but underlined that problems faced within certain industry sectors must be addressed with a remedy for each specific ailment, once the international agreement is concluded, rather than with an overdose of free carbon credits for all,” she said in a statement.

Environmental NGOs said, however, that it was vital to clarify which particular industries would be identified as energy-intensive.

“The crucial thing now is for the commission to come out very firmly looking at the market structure of the energy-intensive sector, so that we can start to rule out the ones who are in with possible criteria for carbon leakage,” Sanjeev Kumar of the Brussels-based Climate Action Network told theparliament.com.

“Regarding the 15 per cent auctioning, we were actually expecting the parliament to improve upon the original 20 per cent proposal, but given the intense scaremongering that’s going on right now, as long as it’s not zero.”

The environment committee also voted on a report by Finish Green MEP Satu Hassi, which proposes a particular programme of effort-sharing among member states to reduce greenhouse gas emissions in the EU.

MEPs supported the national targets originally proposed by the commission, which would allow some countries, such as Bulgaria, to increase their emissions by up to 20 per cent, whereas others, such as Denmark, Ireland, and Luxembourg, would have to reduce theirs by 20 per cent.

The report, adopted by 65 votes in favour with one abstention, also proposes sanctions for those countries that fail to meet the targets, with the fines being equivalent to those proposed under the ETS, set at €100 per tonne of CO2 equivalent emitted.

Furthermore, this report suggests new post-2020 reduction targets of at least 50 per cent by 2035 and between 60 and 80 per cent by 2050, compared to 1990 levels.

The two reports, along with a report by Chris Davies on carbon capture and storage, form part of the climate-energy package, which will now go on to be discussed by national governments in the council.

Hassi told theparliament.com that she was “pleased and relieved” about the outcome of the vote, and hoped that a first-reading agreement could be reached with the council by December this year.

“Negotiations between the parliament and the council start now. There are many issues where we will face some tough negotiations, such as long-term targets...especially on the sanctions which we are demanding for those member states that do not comply,” she said.

“I feel that I have a very good basis for negotiations with the council,” she added

It is hoped that some form of agreement on this package can be reached by the end of the year and then carried forward to the international climate negotiations taking place in Poland in December, and later in Copenhagen in 2009.

Environment commissioner Stavros Dimas welcomed the votes, saying that it was now up to member states to take the matter forward.

“The climate-energy package sets an example which our international partners are watching closely, and each step towards finalising it is important. I expect further impetus in this direction from the European council next week and the environment council on 20 October,” he said in a statement.

Doyle also added that the upcoming negotiations would be very important to the overall aim of securing an international agreement to tackle climate change.

“For once, let’s get short-term answers on long-term problems. We’re going to have to deliver on this,” she said.