REFILE-Poland says cannot surrender UN pollution permits

Wed Nov 28, 2012 6:45am EST

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* Developing nations, campaigner say EU rift very serious

* Poland reiterates opposition to boosting EU ETS

By Barbara Lewis

BRUSSELS, Nov 27 (Reuters) - Poland cannot surrender any of its international pollution permits as they are a "sovereign right", Poland's environment minister said on Tuesday, dismissing arguments the nation's glut of the allowances could derail Doha climate talks.

Developing nations and campaign groups have said the rift within the European Union over the permits, known as Assigned Amount Units (AAUs), is the biggest obstacle to finding a way to take the Kyoto process on tackling climate change forward.

Those opposed to leaving a surplus in the system argue it makes it too cheap to pollute and would undermine any second Kyoto period on curbing greenhouse gas emissions after the first runs out on Dec. 31.

Poland disagrees.

"The AAUs are a completely minor issue," Polish Environment Minister Marcin Korolec told reporters in Brussels in a telephone link from Warsaw. "We have to concentrate on the real issues, not the minor issues."

So far, every EU effort to get a compromise has failed, in part because of the hard line on the issue taken by Poland's parliament.

Asked why Poland could not give up AAUs if they were so minor and with limited market value, Korolec said they were a right, which Poland earned by cutting its own emissions.

"It's a sovereign asset. It's up to the state to decide," Korolec said.

The real issues for Doha, he said, were to decide on the length of a second commitment period and on future emissions reductions.

EU LED LAST YEAR'S DURBAN DEAL

Poland, as holder then of the rotating EU presidency, took a leading role at last year's climate talks in Durban, South Africa, when the EU team was credited with clinching an interim deal to keep alive the Kyoto process, the only global pact to tackle climate change.

It is also offering to host in Warsaw next year's U.N. international climate summit.

But within the EU, Poland, which is heavily dependent on carbon-intensive coal, is at odds with many of its partners.

"The biggest split here in Doha is within the EU, with Poland opposed to the other EU nations over the issue of AAUs," Martin Kaiser, a campaigner at Greenpeace, said on the sidelines of the Doha talks, which began on Monday and continue for two weeks.

Poland opposes anything that might increase the cost of power generation and has also been blocking EU attempts to boost its own Emissions Trading Scheme (ETS), which is also sinking under a burden of surplus credits generated by recession.

The Commission has put forward a plan, known as backloading, to temporarily withdraw some of the surplus credits and in theory could vote on the issue at a meeting on Dec. 13.

"We are in the middle of a discussion," Korolec said, when asked if other EU nations were supporting the Polish position to block the Commission proposal.

"That would be for me quite a strange situation to have a vote on a proposal that has no legal grounds," he said. (Additional reporting by Alister Doyle in Doha; Editing by James Jukwey)

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