* European Commission to announce new climate targets on
* EU executive expected to pare back its climate ambitions
* Aim likely to be reduction in CO2 emissions by 40 percent
By Barbara Lewis and Charlie Dunmore
BRUSSELS, Jan 20 Seven years after it set some
of the world's most stringent environmental targets, the
European Union is about to revise its long-term goals to take
more account of industry and changed economic circumstances.
Following years of economic turmoil, low growth and rising
energy costs, the EU is looking to strike a balance between
tackling climate change and giving industry room to manoeuvre as
it prepares to unveil new targets on Wednesday.
Instead of the "Holy Trinity" of goals laid down in 2007 - a
20 percent reduction in carbon dioxide emissions from 1990
levels by 2020, 20 percent use of renewable energy sources and
20 percent gains in energy efficiency - the new targets for 2030
are likely to be simpler.
As the United States enjoys an energy boon because of the
exploitation of vast shale gas reserves - its natural gas prices
are roughly a third of EU levels - Europe will also avoid
putting obstacles in the way of its own shale exploration.
But while the targets are less ambitious and the atmosphere
more realist, the expected headline goal would demand effort.
EU officials say they expect the European Commission, the
executive arm of the 28-nation bloc, to suggest cutting CO2
emissions by 40 percent from 1990 levels by 2030 - still a
higher benchmark than any other industrialised region.
"We still have a responsibility of leadership, but we should
not believe we can do this alone," one of the officials involved
in drafting the policy paper said, acknowledging that the EU
cannot afford to be as ambitious as it was in 2007.
While the shift reflects realism at a time when the EU's
biggest trading partners, including the United States, Japan and
Canada, have scaled back their climate commitments, it is also a
nod to the lobbying influence of European industry.
Major companies and utilities have said that overly
stringent targets will drive business out of Europe, making it
harder for the continent to compete. With growth negligible and
unemployment at record highs, that is an argument that has found
traction in Brussels.
"The high cost of non-competitive technologies to
decarbonise the power sector cannot be borne by our companies in
addition to already uncompetitive energy prices," heads of
industry said in a letter to the Commission this month.
The 14 signatories, who asked for "one single, realistic
target" plus a goal on industrial growth, included top
executives from chemical companies BASF and Dow
, and steelmaker Arcelor Mittal.
Roger Pielke, a professor of environment at the University
of Colorado at Boulder, says it is an "iron rule" that economics
dominates climate goal-setting.
"When politics focused on economic growth confronts politics
focused on emissions reductions, it is economic growth that will
win every time," he wrote in his book "The Climate Fix".
Or, as analysts Andrei Marcu and Christian Egenhofer at
Brussels' think-tank CEPS put it in a paper this month:
"The economic crisis, which has contributed to achieving EU
greenhouse gas emissions reduction targets, has also made
industry margins shrink, and so too the industry's ability to
invest in existing and new facilities in the EU. Most
governments' fiscal room for manoeuvre was strongly reduced."
The adjusted attitude has many detractors including
Germany, the EU's largest economy and most influential country,
which is shifting from nuclear power to renewable energy.
It is intent on having tough targets not just for overall
CO2 levels, but for renewables in each member state. It wants
individual binding targets, not the loose EU-wide one expected
to be proposed, which critics say could never be enforced.
German industry finds itself pulled two ways. Many of its
companies are involved in the solar and wind sectors, but it
also has major utility companies, which would prefer a single
target on cutting emissions.
Europe's emissions-cutting goal will form the basis for the
EU's negotiating position at U.N. climate talks, which have a
2015 deadline for agreeing a successor to the 1997 Kyoto
Protocol, the current global pact to combat climate change.
According to Commission data, a 40 percent cut in EU
emissions of CO2, leading towards an 80 percent cut by 2050, is
the least the bloc must do to help prevent global temperatures
from warming by 2 degrees Celsius (3.6 Fahrenheit) compared with
United Nations climate change experts say a rise of more
than 2C would lead to catastrophic effects, including a sharp
rise in sea levels.
Many scientists disagree with the Commission analysis and
say the EU needs to go further than announcing a headline cut of
40 percent on Wednesday, arguing it must deliver at least 50
percent by 2030. And developing nations, which argue at U.N.
talks that the industrialised world must carry a greater share
of the burden, are unlikely to be impressed by the EU offer.
Wednesday's Commission announcement will be followed by
debate at EU summits in March and June and a draft law, probably
early next year.