Higher emissions target ‘could save money’

Commission report to support higher carbon emission reduction targets for 2020.

A report to be issued by the European Commission in the coming weeks will bolster the case of those who want the EU to move to a higher carbon emissions reduction target for 2020. It will show that such a move could actually save money in the long run.

The EU has committed itself in international UN negotiations to a 20% emissions reduction by 2020 compared to 1990 levels , but analysis has shown that this will be easily achieved. The Commission report, requested by member states, will show that moving to a 30% target would have far less negative economic effects than previously thought, according to a leaked draft.

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Moving to a 30% target would cost Europe about 0.5% of gross domestic product, according to the draft. This is far less than previous analyses had predicted, as the economic crisis has reduced industrial activity and lowered the price of carbon in the EU’s emissions trading scheme (ETS). The deficit would be made up through lower fuel costs and the economic contribution of new green industries, the report finds.

Taking the lead

Jo Leinen, a German centre-left MEP, said it was now clear that the EU must move to 30% in order to be taken seriously in international climate negotiations. “If we have the figures now on the table, how easy it is to achieve 20%, then the EU can only be a front-runner if we increase the target,” he said. “I’m quite optimistic that it will be done, either this year or next year.”

But there has been stiff resistance from some member states to raising the target, particularly from Poland, which is heavily reliant on coal. Last year, Poland refused to support the Commission’s low-carbon roadmap because it appeared to suggest moving to a 25% emissions target by 2020. The Polish government said it could not agree to the roadmap until the Commission conducted an analysis of the economic impact.

The resulting report shows Poland has reason for concern. Though overall the economic impact of a higher target could be positive for the EU, the move would be expensive for some central and eastern member states, including Poland. As a possible solution, the draft suggests western states such as Germany set aside ETS allowances in order to increase the carbon price and allow other member states to make more from their auctions.

Call for support

Denmark, which holds the rotating presidency of the EU’s Council of Ministers, supports the move to a 30% cut. But speaking in Brussels on Tuesday (24 January), Martin Lidegaard, Denmark’s climate and energy minister, said it will not put the issue on the agenda unless it sees increased support from member states.

The European Parliament has also been split. In July last year, centre-right MEPs refused to back a call for the EU to move unilaterally to a 30% target in a report by the environment committee. They instead wanted a 25% target. In the end, any call for raising the target was dropped after MEPs failed to agree.