* For other news from Reuters Global Climate Change Summit, click here
* Urges 40 percent CO2 cutting goal for 2030 for EU
* Says pan-European goals, certainty, will unleash investment
* CO2 prices need boost to help protect the climate better
By Vera Eckert and Tom Käckenhoff
DUSSELDORF, Oct 13 (Reuters) - The head of Germany’s biggest utility, E.ON, said on Monday an EU package of 2030 targets for tackling climate change looks likely to bring deep carbon emissions cuts and early reforms to the bloc’s Emissions Trading System.
Leaders of the 28 EU countries meet on Oct. 23-24 to agree on a package of 2030 targets for emissions cuts, the deployment of renewable energy and the improvement of energy efficiency, as the bloc prepares for a 200-nation summit in Paris next year to strike a new U.N. deal on tackling climate change.
“We hope that (next week) there will be clear support for an emission reduction target of 40 percent (over 1990 levels) for 2030,” said E.ON Chief Executive Johannes Teyssen, who was interviewed at the Reuters Global Climate Change Summit.
Poland is among those European countries opposed to stiff EU targets as it relies heavily on coal-fired power generation, but Teyssen said his recent discussions around Europe made him optimistic that an agreement could be found.
European businesses are sharply divided over how aggressively the European Union needs to reform the Emissions Trading System (ETS), which is meant to be the EU’s flagship policy to cut greenhouse gas emissions.
“It would be optimal if they also opened a discourse about bringing forward a (CO2) market strategic reserve earlier than previously planned (for the ETS),” said Teyssen, who is also president of European electric utility lobby Eurelectric.
Teyssen has long argued that only harmonised renewable targets and a strong ETS with prices encouraging Europe’s strategy towards a low-carbon economy can renew investors’ confidence and prevent a patchwork of national climate goals.
The ETS puts a mandatory price on emissions and forces more than 12,000 power plants, factories and airlines to surrender a permit for every tonne of CO2 they emit.
The permits are traded, but prices collapsed to a record low of less than 3 euros per tonne in April last year as a surplus of 2.2 billion permits built up, undermining attempts to drive businesses towards greener investment.
Industrial heavyweight Germany, and Europe’s biggest CO2 emitter, favours setting aside permanently hundreds of millions of surplus carbon allowances four years earlier than a previous 2021 target for a temporary permit reserve.
Thomson Reuters Point Carbon data shows that putting permits aside permanently could maintain CO2 prices above 10 euros a tonne. Otherwise, prices could slip to current levels below 6 euros a tonne later this decade if the temporarily withheld permits come back into the market.
At the moment, front-year EU carbon allowance futures are below levels that create incentives for green investment, and instead encourage CO2-intensive coal burning.
“There can only be pan-European climate targets,” Teyssen said at the summit that runs from Oct. 13-16 at various locations around the world.
In his Eurelectric role, Teyssen has to consider interests from coal-heavy Polish power producers that fear high carbon costs, to pro-business groups that want to shield EU industries from foreign rivals with looser environment laws, to offshore wind champions such as Denmark’s Dong Energy.
Teyssen said the ETS, which forces half of all EU emissions into the scheme, should become the driver for investment.
“If everyone can rely on the ETS, investment will be lucrative again,” Teyssen said. “This is not primarily a topic for the energy producing industries, but for all industries in the EU.”
The European Union emits 10 percent of global CO2 and wants to show the world that a transition to low carbon economies is possible without destroying industry.
E.ON, like German peer RWE, is among the European Union’s biggest CO2 polluters due to historically high numbers of fossil fuel-fired power stations. Both are trying to catch up on lucrative green energy production, but need help from outside investment given their large amounts of debt.
(For other news from Reuters Global Climate Change Summit, click here)
Follow Reuters Summits on Twitter @Reuters_Summits (Additional reporting by Barbara Lewis in Brussels; editing by David Clarke)