Cooperation on market-based instruments is a “significant achievement” of EU-US talks on climate change, Environment Commissioner Stavros Dimas has told EURACTIV in an exclusive interview. Other topical subjects covered in the interview include: REACH, research on eco-technologies, impact assessments, the Lisbon strategy and the implementation of environmental legislation.
How different is your approach to environmental policy compared to your predecessor Mrs. Wallström? Do you have other priorities?
The work at the Commission is both continuation and change at the same time. The main priorities were those set in the 6th environmental action program and we decided to halt the loss of biodiversity, to combat climate change and cut greenhouse gas emissions, to create a healthy environment and to use resources that can be sustained. In each of these areas we have sub-categories of priorities that are also very important. It is very important to focus a lot of attention on implementation and integration – both very important priorities, along with simplification and better regulation.
Would ‘better regulation’ then be the differentiating factor compared to Mrs. Wallström?
Most of these priorities were set by the sixth environmental programme and I know that Mrs. Wallström’s high priorities also included implementation and integration which is actually a requirement by the treaties and the Cardiff process.
On the other hand, this Commission is focusing very much on the Lisbon agenda. Some NGOs have expressed concerns that by focusing on competitiveness and Lisbon, environmental policy might be neglected. Mr. Barroso used an analogy about the “three sons” (see EURACTIV, 3 Feb. 2005). Do you subscribe to this view?
First of all, it is correct that Lisbon is concentrating on jobs, employment and growth. In Europe, we all know that there are about 90 million people unemployed and in certain countries the unemployment is up to 18% like in Poland. In Germany, a record percentage of the population are unemployed. Yet, the growth rate in Europe has been revised and is going to be around 1.6%, which is not satisfactory. So, it is correct that we focus on jobs.
…at the expense of the environment?
But not of course at the expense of the environment. The Lisbon strategy clearly states, as has Mr. Barroso, that the heart of the strategy – the overarching principle – is sustainability. So we are looking at sustainable development and the European Council made it very clear that the three dimensions of the Lisbon strategy – economic, social and environmental – are of equal importance and will be mutually reinforced.
The opposite criticism comes from business which says that the sustainable development strategy is putting too much emphasis on the environment and not enough on the economy. So there are two ways of viewing the situation. How do you actually plan to bridge these two viewpoints?
In the communication on the Lisbon agenda, as well as on the strategic objectives that were published for the next five years, and also on the Lisbon guidelines, we stressed the fact that environmental policies are absolutely essential for boosting competitiveness. These include ecological innovations and ecological technologies, energy efficiency and the combination of these will help European industry.
It is important to note that eco-technologies and industries have a 5% yearly increase growth – more than any other industry. There is already a 500 billion euro market for eco-products in the world today. If the European industry moves ahead fast enough with certain eco-innovations, they will benefit from an increased market for ecologically orientated produce.
So it is our belief that the environment is reinforcing the competitiveness of European industry and the Lisbon strategy with its objectives which are employment and growth. We do not see a conflict between environmental objectives and the Lisbon objectives for growth and employment.
In the 7th Framework Program for research, two and a half million euros is earmarked for environment and climate change, while about 12 billion is foreseen for ICT. Isn’t there a big disparity there that contradicts what you are saying?
Firstly, what is invested in research related to the environment has been increased quite a lot. There has been a real substantial increase in investment in research for environmental purposes and other related sectors, such as renewables and energy efficiency which are both contributing to climate change and to fighting air pollution. So we have had a considerable increase in investment for environmental research.
Do you believe this is enough of an increase? Would you have liked to see more?
I think the increase has been quite substantial – greater than in other sectors – although you will never be satisfied with the amount allocated. The Americans, for example, have invested a lot more on areas such as climate change.
Commissioner Verheugen has said that he wanted to make a systematic use of impact assessment before any proposals are put forward by the Commission in the context of the refocused Lisbon strategy. How do you intend to integrate the environmental and health benefits in impact assessments? Business associations and industry are usually very good at producing impact assessments on economic costs. But it is reputedly more difficult to actually put forward figures for the benefits…
What we have said is that impact assessments should consider all three dimensions and Mr. Verheugen stressed the importance of the economic and competitiveness aspects. I don’t think this is wrong. It does not mean that the other two aspects of impact assessment will not receive an equal level of attention. This is the purpose of an impact assessment. It looks at all three dimensions. A good impact assessment considers all the costs and benefits
But impact assessments are about economic values and whereas some costs can be expressed in terms of money, a clean environment or cleaner water is not something that can be measured on a monetary scale…
This is correct, but it is still possible to measure the cost of inaction or the cost to health. It is possible to measure the cost of reversing damage done to the environment in monetary terms – calculating both the immediate cost and long-term costs. If the destruction to the environment now has to be undone five years later, this will require greater levels of investment. It is difficult to estimate in monetary terms, but it is possible. There are means that have been developed in order to calculate what the cost will be – and the impact assessments we have initiated up until now have successfully achieved this.
A well-known example in using impact assessments has been with the REACH proposal on chemicals. Around fifty were made which often contradicted each other. Is this not a sign that impact assessments are just an added tool, not actually the best device for policymakers as they can contradict each-other?
Impact assessments are of course a useful tool. Political decisions are something different. You take a political decision and you base your judgment and your ultimate decision on various elements that you have at your disposal. Impact assessments are an important element, but sometimes you have other political targets.
Nevertheless, impact assessments are a valuable asset and REACH is one example. You mentioned that there were fifty impact assessments. The Commission of course relies on its initial extended impact assessment which still stands – even after the one carried out under the memorandum of understanding – more or less confirming the findings of this impact assessment.
As we discussed before, health and environmental benefits are very difficult to calculate and put into monetary terms. In terms of benefits, you must calculate if possible the reputation of the products, the first mover advantage and the fact that downstream users are sure of the substances they are putting in their products guaranteeing safety to their customers. All these are benefits you cannot put into monetary terms.
One of the weak points of EU environmental policy has been implementation. Can the Commission do more than it is actually doing now to improve the process and make sure that member states deliver?
This is very important of course, taking into account that environment produces one third of European legislation. It is therefore very important to implement this legislation. If we do not do so, then future legislation loses its credibility. We are going to focus on implementation and, especially in 2006, pay a lot of attention to this problem. Time is needed in order to prepare.
What extra can you do?
First of all it is important that any new legislation is better drafted. Often better regulation is seen as being unwelcome for the environment, but we want better regulation. If it is better drafted and more simplified, it automatically becomes easier to implement. So this is one major target; to have better, simpler legislation which is easier to implement. We should also press for extensive consultation with the member states and the stakeholders from these states to exchange information, explain guidelines and generally facilitate the implementation process. Improved communication is very important in this aspect.
You recently had a good example with the Irish case that went to court…
We always prefer to deal with affairs in a voluntary and co-operative way, but sometimes you are compelled to take matters to court. I think we really need to endeavour to improve implementation.
Why 2006 specifically?
We have chosen this year because if you look at the development of the infringements you will see that in 2004 there is a levelling off of the infringement cases. We hope that in 2005 we will stabilise again and then in 2006 we will try to go for a decrease if possible.
One other element of environmental policy is the Cardiff process: getting environmental consideration into all different EU policies. Do you think that enough has happened there in the last few years and, if not, will you revise the Cardiff process?
First of all, I do not think that environmental matters can be dealt with in isolation. They need to be part of decisions made across wider inter-sectors. We have an example in transport policy. Transport is very important, for example, to fight climate change or air pollution. So we have to co-operate and integrate into transport policies the ways and means to combat greenhouse gas emissions, especially carbon dioxide and other pollutants.
Therefore you need to integrate and up till now, at least nine sectors have integrated environmental policy: transport, energy, trade, foreign relations, agriculture, fisheries, research, the internal market and consumers. This is the way to advance environmental objectives. In some of them, such as agriculture and fisheries, we already have very positive results. Of course, the developments regarding the Cardiff process are not really what we would have expected and we should reinvigorate this process and try to co-operate with all other sectors in order to integrate environmental objectives.
Will there be a Commission communication on this soon or do you have any plans for a Commission initiative on reviving the Cardiff process?
This is our objective. We do co-operate with other commissioners and DGs in order to promote our aims together. In many cases we do not receive simply environmental objectives but also their own objectives.
Internal Commission structures tend to create segmented approaches to policy-making, along departments (Directorate-Generals). Isn’t that detrimental to the Cardiff process? Is the Commission doing enough to promote co-operation between DG’s?
Let me give you an example: President Barroso’s initiative on maritime policy. This is a very good example of integrating environmental policy with other areas.
And the CARS 21 group (see EURACTIV, 8 April 2005)? Is that an area where DG environment is also involved?
Yes we are involved. This is another good example that involves not only enterprise but also transport and environment.
The Commission was at first hesitant to define precise targets for the EU’s post-2012 climate change policy. Why was this? How confident are you in succeeding to get the US and other big emitters on board?
First of all we were not hesitant about targets. We consider targets very useful and they have proven their usefulness in the past. At the same time, proposing targets now or when the communication was made would be premature as it would create certain difficulties in negotiating with other countries. The Environment Council accepted this approach and we discussed our targets. Although we didn’t set specific goals, we said that we were going to explore pathways, strategies and policies for reductions of the order of 30 to 50% for 2020 and 60 to 80% for 2050.
So despite not being targets, they were indications of what we consider acceptable aims according to today’s scientific data in order not to exceed the 2 degree Celsius level [referred to in the Kyoto Protocol]. In the European Council, they kept the same wording, but only put indications on estimated targets for 2020. So we have put these indications on the table, saying what we consider to be realistic reductions, but at the same time refraining from scaring off other countries that are very hesitant to enter into discussions now if they have to meet reductions as significant as this.
Was this strategy helpful when you were visiting New York and Washington in April (see EURACTIV, 18 April 2005)?
Yes, very helpful. In Washington we discussed climate change quite extensively with the deputy secretary of state, Miss Dobriansky, who is responsible for environment and climate change, with the president of the environmental quality office at the Whitehouse, Mr. Connaughton, the private council at the Whitehouse and with the secretary of NSE Mr. Boardman. We had a public event at the Brookings institute with the participation of many stakeholders where we had a very lively and interesting discussion showing the thinking regarding climate change and other environmental issues. We made it clear to the United States that we thought bilateral and regional co-operation was good.
But we also need multilateral co-operation and it appears that they agree, which is different to the position they have taken until now. It was also important that we stated to them that we value the agreement on technology and research, but it is not enough. So, further steps need to be taken. They agreed on this – a distinct improvement on their previous position. We also agreed that the G8 summit was a good place to discuss this. It was also decided to set up or re-activate a high level working group on the environment, discussing climate change and other environmental issues such as energy efficiency and renewables. We hope to have a meeting before COP-11. The significant achievement is our co-operation on market-based instruments which indirectly implies cuts.
Do you have the impression that it will be possible to draw the US into an international agreement after 2012?
What I think will happen is that at G8, the future of both programmes of reductions after 2012 will be discussed. There, I will not be satisfied by a simple agreement on technology and research.
There was a suggestion in the Commission proposal for post-2012 that a ‘G8’ of the world’s biggest emitters could be formed as a parallel forum to the Kyoto process, outside the UN framework. Is this a serious idea?
Agreements at every level are useful. Bilateral, regional partnerships and especially a group like this containing the countries that account for about 75% of emissions. But, of course, this will all be taken into account within the wider framework of the UN convention. If the US agrees then you can imagine that the rest will follow.
Coming back to the issue of technology and research, do you think the EU does enough in these domains? I tried to find out how much the EU is spending on technology and climate change and nobody at the Commission was able to tell me. If I call the US, I will have the answer within five minutes…
The Americans claim that they spend 5.8 billion dollars. I think that our figure will be about 3 billion euros, which is quite a considerable amount of money, especially when you consider that member states are also spending money on research and development. It is important that we do invest in research and climate change as well as the development of new technologies and deployment of existing technologies because new technologies do exist but they are not yet economically deployable. Perhaps the specific conditions in each country should also be studied. All these are factors to consider.