Three reports will be subject to votes by the Parliament's Environment (ENVI) Committee. The first and most controversial for heavy industry relates to the revision of the EU greenhouse gas emissions trading scheme (by Avril Doyle, an Irish EPP-ED group MEP). The second, prepared by Finnish Green MEP Satu Hassi, will determine how much each EU country should take on of the bloc's "burden" to slash greenhouse gas emissions by 20% by 2020.
The third and final report, prepared by UK Liberal MEP Chris Davies, establishes a legal framework for the geological storage of CO2 captured by coal-fired power plants during electricity generation.
Growth first, climate later?
Following the collapse or bail-out of several key banks in the US and in the EU, the 'usual' controversies surrounding the climate proposals have been eclipsed by concerns about grave economic recession, which overshadow Tuesday's vote and are casting doubt on whether Brussels will be able to push through its ambitious CO2 reduction programme (EurActiv 26/09/08).
The climate and energy package is in "deep trouble", The Economist reported on 4 October. German Chancellor Angela Merkel, a "green champion" in March 2007, "now sounds like a lobbyist for German business," the weekly commented.
Merkel has indeed indicated that she may not support an "ill-advised climate policy," and Germany's foreign minister last week admitted that the economic crisis "changes priorities," the Financial Times reported. "One cannot rule out that interest in protecting the climate will change because of such a crisis," the minister said.
Stern warnings
Advocates of ambitious policies to reduce climate change say this logic is faulty, drawing on findings and recommendations submitted in October 2006 to former UK Prime Minister Tony Blair by Sir Nicholas Stern.
The 'Stern report' argued that keeping global warming under control through massive investment today would cost the global economy far less than coping with the damage it will cause (EurActiv 31/10/06).
But many of Europe's industries say paying too much for emitting CO2 means they cannot stay competitive internationally and will be forced to move production and pollution outside the EU's borders, leading to a 'leakage' of carbon that would be environmentally counter-productive. To prevent such a scenario, they say, certain industrial sectors like aluminium and cement producers should be given up to 100% free emissions allowances.
The issue is the cause of an internal rift in the EP's largest political group, the Christian Democratic European People's Party (EPP-ED) party. Doyle, an EPP-ED member, is fighting to gain support in advance of the vote in the face of opposition from some MEPs, who say a stricter EU ETS would undermine European industries, according to ENDS Europe reports.
The coal equation
Competitiveness concerns are also at the heart of MEP Davies's report on carbon capture and storage (CCS). While the Davies report in itself has not been the focus of extreme controversy, the issue of how to pay for CCS has.
Davies has worked closely with Doyle in recent months to link CCS financing to the ETS proposal. The two rapporteurs have drafted an amendment that, if accepted by other MEPs and by the Council, would see the transfer of massive sums from a special ETS reserve fund to select CCS demonstration projects.
CCS is considered a vital tool in the fight against climate change, including by a number of environmental NGOs (with the exception of Greenpeace). It remains unclear how the expensive technology could be funded and made competitive, though a recent report by the business consulting firm McKinsey indicates that CCS could become commercially viable by 2030 (see EurActiv 24/09/08).
The votes are preliminary and need confirmation by the full plenary of the Parliament. But they will give an indication as to where the package as a whole is headed, and lay the basis for negotiations with the Council.
