FACTBOX: Key issues at the EU summit on climate and energy

(Reuters) - European Union leaders meet in Brussels on Thursday and Friday to discuss a common EU energy policy and new goals to fight climate change.

Below is a summary of the key issues and proposals made by the European Commission on January 10 along with views from member states, environmentalists and industry.

CLIMATE CHANGE

The European Commission proposed the 27-nation bloc commit to cutting greenhouse gas emissions blamed for global warming by 20 percent compared to 1990 levels by 2020, boosting that goal to a 30 percent cut if other industrialized nations join in.

EU governments have supported the targets and urged emerging nations such as China and India to do their part as well.

Some environmentalists say the EU should make 30 percent a minimum target. Industry says 20 percent is tough but realistic.

Carbon dioxide is the main greenhouse gas, which scientists say heats the earth, raising sea levels and melting glaciers. Others include methane and nitrous oxide.

The EU currently produces about 14 percent of the world's greenhouse gas emissions. The United States produces 25 percent.

The 15 EU nations that were members before the bloc's 2004 enlargement pledged under the Kyoto Protocol to cut emissions by 8 percent by 2012. They are behind on that goal. In 2004 their emissions were down 0.9 percent compared to 1990 levels.

RENEWABLE ENERGY AND BIOFUELS

The Commission proposed a binding target for renewable fuels to make up 20 percent of EU energy use by 2020. Leaders are unlikely to agree to make the goal mandatory at the summit.

The EU has a voluntary goal to raise renewables to 12 percent of the energy mix by 2010 but it is likely to be missed. Currently renewables make up less than 7 percent.

Renewable energy sources include wind, solar, tidal, and hydroelectric power. The EU is a world leader in renewables.

Separately, the Commission proposed that biofuels make up 10 percent of vehicle fuel by 2020. Governments have endorsed that goal, which will contribute to the renewable energy targets.

Environmentalists and the Commission say binding renewable targets will help meet the bloc's climate change goals and increase energy security.

BREAK-UP OF GAS AND ELECTRICITY GROUPS

The Commission proposed that big utility groups be forced to sell or separate their generation businesses and distribution grids in a process called "ownership unbundling."

It says that would bring prices down and help new entrants.

A second option would let companies keep ownership but hand over operation of their grids to an independent system operator.

An unofficial third option would involve regional grid operators taking over the operations of merged networks.

Governments are lukewarm about the proposals and some have declared ownership unbundling dead. EU energy ministers called for "effective unbundling," wording leaders are likely to echo.

Energy giants such as Germany's E.ON and RWE as well as Gaz de France and EDF would be affected by any new rules.

The Commission has also proposed other measures to complete the bloc's internal market in gas and electricity.

ENERGY EFFICIENCY

The Commission proposed an EU target to reduce energy use by 20 percent by 2020. Measures include making buildings, cars, power generators and electrical products more energy efficient. Governments support the proposals.

CLEAN ENERGY TECHNOLOGIES

The Commission wants to promote carbon capture and storage projects to make power production from coal, a plentiful but dirty fuel, cleaner. Governments are expected to back a plan to build up to 12 large-scale pilots of the technology by 2015.

ONE VOICE TO FOREIGN SUPPLIERS

The external relations dimension of the proposed energy policy calls on EU states to speak with one voice when negotiating with foreign suppliers, especially Russia, which supplies 25 percent of the bloc's oil and natural gas.