The package is a set of legislative proposals on emission cuts, renewable sources, carbon capture and revision of the emission trading scheme. All major CO2 emitters will be given an incentive to develop clean production technologies through a thorough reform of the Emissions Trading System (ETS) that will impose an EU-wide cap on emissions. The package seeks to deliver the European Union to reduce greenhouse gases by at least 20% and increases to 20% the share of renewable energies in the energy consumption by 2020, as agreed by EU leaders in March 2007. The emissions reduction will be increased to 30% by 2020 when a new global climate change agreement is reached.
Commission President Barroso: '20 / 20 / 20 by 2020'
The President of the European Commission, José Manuel BARROSO, unveiled to the European Parliament on Wednesday the Commission's plans to tackle climate change and to ensure Europe has more secure energy supplies in future. At the heart of the proposed legislation is the principle of '20 / 20 / 20 by 2020' (a 20% increase in energy efficiency, a 20% cut in greenhouse gases and a 20% share of renewables in total EU energy consumption, all by the year 2020).
According to Mr Barroso, 'The struggle against climate change and the quest for secure, sustainable and competitive energy touches on every European, every day'. Indeed, he added, 'Europeans want a vision, and a plan of action' on this issue. He welcomed the EP's backing so far, saying 'The clear commitment of this Parliament to this cause has been essential. Your work over the past year has been critical in building the political momentum in favour of action.'
The Commission president then outlined the package, which aims 'to bring about a 20% cut in our greenhouse gas emissions by 2020, and be ready to step up to 30% with an international agreement'.
The five main points of the package are:
- an updated Emissions Trading System;
- specific, binding national targets;
- a new approach to promote renewable targets, again including binding national targets;
- new rules to stimulate carbon capture and storage;
- new state aid rules.
In view of growing concern over biofuels (which will have to account for 10% of vehicle fuel), Mr Barroso stressed that environmental sustainability would also be taken into account.
He then explained that the package was prepared with five key principles in mind:
- respecting the targets;
- recognition of Member States' different investment capacities and starting points;
- competitiveness, by minimising the costs to the European economy;
- the need for an international agreement to cut greenhouse emissions;
- the need to start work now to halve global emissions by 2050.
On climate change, action would be cheaper than inaction, said Mr Barroso: the cost of the proposals would be 'less than 0.5% of GDP by 2020', which 'amounts to about €3 a week for everyone'. He added, 'Even on the most optimistic assumptions of the Stern Report, the cost of inaction is more than ten times that'. Moreover, 'every day the price of oil and gas goes up, the real cost of the package falls. Instead of costs, we really should be talking about gains for the EU'.
As to the concerns expressed by business, Mr Barroso acknowledged that 'there is no point in Europe being tough if it just means production shifting to countries allowing a free-for-all on emissions'. Thus, under the package, 'energy intensive industries would have ETS allowances free of charge' and 'if our expectations about an international agreement are not met, we will look at other options such as requiring importers to obtain allowances alongside European competitors', provided this was compatible with WTO rules.
The Commission president added 'we must not forget the huge economic opportunity represented by Europe's transition into a low-emissions economy', adding that 'There are real opportunities there: the renewables sector alone will bring one million jobs by 2020'.
In conclusion, he saw the package as 'an opportunity for Europe to show itself at its best. Tackling an issue of fundamental long-term importance. Using the EU's continental scale to best effect.' Indeed, 'if some have doubts about the European Union, this kind of policy shows why we need a strong EU more than ever', since 'even bigger Member States do not have the leverage to push this forward'.
Political group speakers
Marianne THYSSEN (BE) speaking for the EPP-ED group said: 'Today is a historic day. A day which will influence our way of thinking, behaving and living. This Commission will be remembered as the Commission which presented a masterplan for energy.
Europe is showing it is not afraid to shoulder responsibility for climate. But we need to reconcile ambition with feasibility.
We feel the plan is balanced and we support the 5 underlying principles. We will also be looking at the proposals for each Member Stare to see if they are fair and feasible.
We know there will be a lot of proposals to weaken and water down the proposals but we are basing ourselves on the principle that those who shout loudest won't necessarily get their way.
Inaction will cost us more than action. We need a balance between reaching climate targets and building a strong economy, but all of us, business and citizens, are going to have to change.'
Hannes SWOBODA (AT) speaking for the Socialist group said: 'You have set the right goals. When it comes to implementation, on biofuels for example, we are sceptical about present technologies. We have to have better technology for biofuels and that is something we'll need to look at in our budget discussions.
Many will say that a 20% cut is too little, but I agree that there is no point Europe going alone unprotected. We need international agreement as soon as possible and need to be thinking now what we should to do if we don’t get these agreement - would be go for import duties then or a CO2 tax?
We need to look at what we achieved with the REACH chemicals laws as a model for this package. With such an alliance of ecologists, industry and workers we can take forward our economic goals and ensure a cleaner Europe.'
Graham WATSON (ALDE, UK) said: 'Climate change is the biggest challenge facing this planet. The biggest problem facing our governments and the biggest worry facing our citizens. Yet for all the lip service paid to environmental protection Europe's leaders have failed to put their money where their mouth is and pay the price for a cleaner, greener world.
It's high time our leaders realised a percentage here and a decimal point there won't make a blind bit of difference Because percentages pale into insignificance when compared to the cost of doing nothing. The Stern Report - the most authoritative environmental survey ever published - estimates global warming will cost the world up to £3.68 trillion unless it is checked within a decade. That means spending 1 per cent of global GDP now, of facing a bill up to 20 times higher, later, for damage caused by letting it continue. Seen in that light, the Commission's proposals while a welcome - and, by today's standards, radical - departure from short term economic thinking are still only the tip of the iceberg when it comes to tackling climate change'.
Liam AYLWARD (UEN, Fianna Fáil, East, IE) said the energy package would allow us to 'set targets to reduce CO2 emissions and increase the renewable balance in the energy mix. This legislation will give stability to markets, the business sector, scientists and investors'. Regarding the use of bio fuels, Mr. Aylward said that the EP does not claim it is a bad solution to deal with CO2, but that many say the 10% target is too high. 'Above all, this legislation must be sustainable', he said.
'The EU can win back the approval of its citizens through a good climate protection policy', said Rebecca HARMS (Greens/EFA DE). But she sees this threatened because 'we don't see action following the words.' She also criticised the industry sector: 'The attacks by European Industry are unacceptable because it was after all the free market which created the problem with the climate, it was not China or India. They are not the ones who had these wasteful economies and created too many emissions. The free market therefore needs to be regulated.'
Roberto MUSACCHIO (GUE/NGL, IT) named several points of the Commission's proposal which he can not agree with, for example 'the excessive role for biofuels, despite increasing doubts concerning them.' Also, 'exemption to certain countries and certain polluting sectors are squandering European credibility at this decisive stage.' Mr. MUSACCHIO considers the exemptions for the steel sector as very dangerous. 'We can agree to the 20/20/20 goals, but we have to include measures for cars and airplanes, we have to have a credible vertical approach.'
Johannes BLOKLAND (IND/DEM, NL) noted the criticism levelled against the Commission's proposals by heavy industry. The impact of the legislation, he acknowledged, 'will be painful for some sectors', 'but we must take these steps'. In this light, he added, we 'look forward' to the provisions on Carbon Capture and Storage (CCS). The biofuels target, meanwhile, 'is one we are critical of': when looking at biofuels, he said, 'we need to make sure that sustainability is taken into account'.
The UN conference at Bali laid the groundwork for an international agreement on climate change, recalled Irena BELOHORSKÁ (NI, SK). The EU, she urged, 'must take leadership' in future climate talks. However, inasmuch as Europe needs the developing world and India and China to get on board - 'China and India must be compensated for reducing carbon emissions', she also noted - 'our efforts will be useless until the US starts taking climate change seriously.'
British and Irish speakers
Graham BOOTH (IND/DEM, UKIP, South West, UK) stated that climate change is precisely that: climate changes all the time. 'So, what if earth’s climate decides to cool down instead of warm up? Will it then be suggested that we must produce much more carbon dioxide to try and offset the cooling? Of course not. They are so committed to their present global warming prediction that will not be an option, but sadly it looks as if that is what is happening. '
Summing up, Mr Booth said that if global warming has been just a temporary blip 'we are now heading relentlessly for the next ice age.' Any reductions, he said, in CO2 emissions will have precisely the opposite assertive effect to that which is intended. In the billions of years of earth’s existence, a very brief pause to check the facts is surely not too much to ask, he concluded.
Chris DAVIES (ALDE, Liberal Democrat, North West, UK) stated that he had two principal fears. First is that governments will sign the pledge but fail to deliver, so he questioned how we are going to build in some sort of interim targets, some penalty structure, to ensure that the promises are delivered at the end of the day. His second fear is that in trying to do good, we will do some harm.
Mr Davies said that his biggest concern here is over biofuels. 'I hear the comments of the Energy Commissioner but the idea that we could risk tropical forest destruction and force up world food prices in order to featherbed our car manufacturers is frankly sickening and we must be very cautious indeed about the sustainability criteria. I have concerns too about the direction of our own budget. We promote schemes that stimulate CO2 emissions and it seems to me that we have to run faster just to catch up with ourselves. '
Concluding, Mr Davies said there are fine judgments to be made on many of these issues. This package of measures, he said, will promote innovation and stimulate investment and create millions of jobs. It must be seen not as a threat, he said, but as an opportunity for us all.
While welcoming the package in principle, Giles CHICHESTER (EPP-ED, Conservative, South West, UK) said that we must recognise that renewables and efficiency gains are a domestic EU asset, which yields benefits for us, both as a sustainable low-carbon economy and for security of supply. We must, he said, also recognise that renewables are not the free lunch that some people think: they have costs attached, which include financial, environmental and inflexibility factors. He shared President Barroso’s determination that we achieve our targets without loss of global competitiveness and without exporting jobs and businesses. Whilst we are on the subject of targets, he continued, we must break with the past performance where the EU has a dismal record in failing to meet targets. We can only agree to binding targets if they are achievable, he said.
Mr Chichester welcomed the approach of market mechanisms, like the Emissions Trading System, but he hoped that the methodology can be improved and made to work better to achieve our aims.
Finally, he suggested that we should 'resist the temptation to be technology specific, we should resist being obsessive about renewables as the solution, when it is the objective of drastic emissions reduction that matters most and, therefore, we must use the full range of means available and not rule out any option.'
Avril DOYLE (EPP-ED, East, Fine Gael, IE) welcomed the announcement of this most important package and looked forward to the legislative debate that will follow. It is timely to remind those, she said, 'especially in my own country, who are rightly exercised about global warming, climate change and greenhouse gas emission increases and who have concerns, on the other hand, about ratifying the Lisbon Treaty – or the Reform Treaty, as we underline – that the environment and climate change are specifically included in the Lisbon Treaty as distinct from the past Constitutional Treaty: a most important point to underline.'
Following Bali, she said, it is clear that Europe, as a Union of 27 Member States, has the capacity and the ability to lead the world on this most critical of issues: climate change. And with this package at its centre, Bali produced a road map for global agreement by 2009, recognising the urgency for clear and transparent international agreements – in President Barroso’s words – to ensure at least a 50% decrease in greenhouse gas emissions by 2020. And while remaining competitive is ever pressing, she said, we cannot solve our numbers and targets by exporting jobs through relocation to regions which have no legislation to reduce greenhouse gas.
Background to the package from the European Commission:
It comprises a set of key policy proposals that are closely interlinked. They include:
(1) a proposal amending the EU Emissions Trading Directive (EU ETS);
(2) a proposal relating to the sharing of efforts to meet the Community's independent greenhouse gas reduction commitment in sectors not covered by the EU emissions trading system (such as transport, buildings, services, smaller industrial installations, agriculture and waste);
(3) a proposal for a Directive promoting renewable energy, to help achieve both of the above emissions targets.
Other proposals that are also part of the package include a proposal for a legal framework on carbon capture and storage, a Communication on the demonstration of carbon capture and storage and new guidelines for environmental state aid.