EU lawmaker calls for clean coal incentives

By Pete Harrison

BRUSSELS (Reuters) - The European Union must craft new financial incentives to "jump start" clean coal technology if it is to achieve ambitious targets to combat climate change, a leading lawmaker said on Monday.

Carbon capture and storage (CCS) is designed to trap carbon dioxide (CO2) emissions from power plants and heavy industry and store it underground. Supporters see it as a potential silver bullet in the fight against global warming.

The geological sequestration process, yet to be proven on an industrial scale, could keep up to a third of global carbon emissions out of the atmosphere, notably in emerging economies such as India and China, as well as EU states like Poland.

The EU aims to have up to 12 such pilot plants running by 2015 but has not yet put in place financial incentives, aside from sparing such plants the expense of buying carbon emissions permits.

Industry has so far been slow to respond, citing high initial building costs.

"There is a risk that the targets the Commission set on renewables and energy savings are not going to be met, so we need to accelerate CCS development," said Chris Davies, the lawmaker responsible for steering CCS legislation through the European Parliament.

"As of this moment, not one single project has been confirmed and time is not on our side," he told Reuters before a meeting with oil majors, power firms and environmentalists on Monday to discuss likely targets.

Giving power generators extra emissions credits for early projects could spur a dash to develop the new technology, while forcing them to equip new plans for CCS could spell the end of dirty coal, Davies added.