French proposal on 2030 EU energy goals could ease deadlock

BRUSSELS Fri Jun 27, 2014 9:12am EDT

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BRUSSELS (Reuters) - A new French strategy on how to offset the economic impact of proposed 2030 climate and energy goals could help EU leaders to agree on them later this year, diplomats said on the sidelines of a meeting of European leaders in Brussels on Friday.

Coal-dependent Poland has led opposition to an early deal on a suggested 40 percent cut in greenhouse gas emissions compared with 1990 levels, which the European Commission, the EU executive, has suggested as the EU negotiating stance ahead of talks on a new global agreement on climate change.

An international deal is meant to be sealed at a U.N. summit in late 2015 in Paris, so France, as the host nation, has a particular interest in getting EU leaders to agree.

In its position paper seen by Reuters, France outlined ways to share the financial burden of the Commission's proposed 40 percent emissions-cutting target for 2030.

It put forward solutions such allowing a share of revenues from trading carbon certifications on the Emissions Trading Scheme (ETS), the EU carbon market, to be given to member states with lower income.

Climate debate among EU leaders at Friday's summit talks was limited to a brief update on the state of play, diplomats said, as the crisis in Ukraine and nomination of a new European Commission president dominated talks.

Some ambitious member states and the environment lobby had initially hoped the June EU summit would get agreement on the 2030 goals, but EU leaders earlier this year pushed back the deadline for a decision to summit talks in October.

Diplomats said debate has proved difficult as many nations, not just Poland, have raised issues.

The European Commission's hopes of getting an outline deal on targets and leaving the finer points to later have faded as member states haggle over the detail of the economic costs, they said.

As in 2008 when the European Union finalised its existing set of 2020 goals, the French paper proposes sharing out the financial burden of 2030 targets on the basis of per capita gross domestic product.

INDUSTRY JITTERS

It also suggests implementing a clause in a neglected existing law that would allow firms regulated under the ETS to buy carbon credits from domestic carbon-cutting projects to help meet their obligations.

A handful of countries, including France, have developed so-called domestic offset projects to help meet 2020 targets in sectors outside the ETS, such as agriculture, housing and transport.

Aiming to allay concerns from industry that more ambitious green energy targets will make it less competitive, the French paper also states the need for continuing a system of providing help for industries most exposed to international competition.

One of the diplomats, who asked not be named, said it was the first real sign of flexibility from the French and was "a good starting point".

(Additional reporting by Ben Garside in London; Editing by Sophie Hares)

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