BRUSSELS The European Union executive is tempering its hopes of securing a legally binding climate deal in talks this year culminating in Cancun, Mexico, focusing instead on a 2011 summit in South Africa, a source said.
"The realistic approach is to aim for deliverables in the Bonn and Cancun meetings this year, and then to aim for a legally binding agreement in South Africa," the European Commission source said on condition of anonymity.
"But we should not give up hope of it being done earlier," the source added.
EU climate negotiators are struggling to find direction after Copenhagen talks in December ended in a weak accord.
Hopes of a strong global deal this year have faded since doubts emerged in January about the progress of climate legislation in the United States -- the world's number two emitter.
U.N. climate chief Yvo De Boer says it will be "very difficult" to agree a binding treaty in 2010.
European Climate Commissioner Connie Hedegaard is expected to lay out her hopes and strategy for climate talks next Tuesday, building on the Copenhagen Accord.
Europe's international standing in climate talks is being harmed by its failure to fulfill aid pledges, a leaked EU document warns.
"There is a risk of conflict with new financial commitments the EU has taken in the framework of the Copenhagen accord," warns the paper, seen by Reuters on Friday.
The EU has pledged to channel 7.3 billion euros ($9.92 billion) in "climate aid" to poor countries over three years to help them cut emissions from industry and tackle climate impacts on crops.
But the accord failed to agree concrete mechanisms for delivering the aid and poor countries worry it will never emerge.
"We need developing nations on our side and are looking to the EU for leadership," said British liberal politician Chris Davies. "There is a lot of cynicism about EU funding offers. This is a chance to prove our words have meaning."
"We need unity in the EU," Davies added. "Connie Hedegaard needs to establish her authority as the EU's lead voice on this."
(Reporting by Pete Harrison, editing by Anthony Barker)