Barroso II must turn carbon cuts into growth


Green jobs and competitiveness will feature high on the incoming European Commission’s agenda as it takes on the challenge of delivering on pledges to lead the world in combating climate change.

As the global community prepares to meet in Copenhagen in December to hammer out a new international climate treaty, the next Commission will have to translate tougher climate commitments into policies while resuscitating Europe’s ailing economy. 

A general consensus has emerged that the answer is to deliver a ‘Green New Deal’ to help Europe meet the climate challenge, create new employment and boost low-carbon industries. 

This was what incumbent and continuing Commission President José Manuel Barroso had in mind when he detailed his priorities for the next five years to the European Parliament. He said that the next EU executive would concentrate on designing a favourable regulatory environment to foster the uptake of low-carbon technologies by European businesses.

“An industrial base which is modernised to use and produce environmental-friendly technologies and which exploits the potential for energy efficiency is the key to sustainable growth in Europe,” Barroso wrote in his guidelines.

Climate campaigners are hoping that the Commission will push for greater emphasis to be put on renewable energies and energy efficiency rather than propping up nuclear and clean coal technologies.

“The challenge for the next Commission will be to develop a blueprint detailing the structural changes that will be necessary for Europe’s transition to a sustainable economy. Dwindling natural resources, unemployment and CO2 emissions are only some of the problems that can be addressed by developing clean and efficient energy,” said Joris den Blanken, Greenpeace EU’s climate and energy director.

In any case, energy efficiency improvements, which unlike renewable energies and emission cuts are not supported by binding targets, will receive ever more attention. The incoming Commission will need to implement the EU’s new Energy Efficiency Action Plan, which the outgoing EU executive is planning to present next month.

Implementing Copenhagen agreement

The climate and energy package negotiated in December 2008 was a landmark of the outgoing Commission’s vision for an integrated approach to climate change mitigation. But depending on the level of ambition of the new international climate treaty, the EU executive will have to rethink the adequacy of existing policies.

The EU has pledged to upgrade its emissions reduction goal from 20% below 1990 levels to 30% by 2020 if other industrialised nations make similar commitments. But scientists say cuts to the tune of up to 40% are required from developed countries for there to be a fair chance of keeping global warming at sustainable levels.

“This of course cannot be achieved with ‘business as usual’, and fundamental changes will be needed in current climate and energy policies, boosting energy efficency and renewables. A complete overhaul is also needed in other policy areas such as transport, housing and agriculture,” said Esther Bollendorff, climate and energy campaigner at Friends of the Earth Europe.

Moreover, an ambitious agreement would need to come with a requirement to provide developing countries with substantial funding to help them tackle climate change and adapt to its inevitable consequences.

So far, the EU’s flagship climate instrument, its emissions trading scheme (EU ETS; see EURACTIV LinksDossier) only recommends that member states spend half of their revenue on climate activities. But the Commission’s blueprint for international financing foresees using these proceeds to finance efforts in developing countries.

“The ETS is promising in principle, but the cap is too lenient and won’t decarbonise electricity nearly on time,” said Jason Anderson, head of European climate and energy policy at WWF. He further criticised generous provisions allowing governments to use offset credits to count emissions cuts made abroad towards national targets.

“Barroso may create green jobs, but they won’t be in Europe if he doesn’t staunch the flow of offset crediting to meet our targets,” Anderson argued.

Taking on transport emissions

One way to upgrade the EU’s climate efforts will be to tackle CO2 emissions from the transport sector. Environmentalists have long urged the EU executive to address the glaring omission of transport from its climate and energy agenda.

Although directives on renewables, clean cars and fuel quality, part of the EU’s climate and energy package, include cars in the bloc’s efforts to fight climate change, voices calling for a more integrated agenda are likely to grow louder. If the Union is to reach its climate goals, it will have to ensure that soaring emissions from transport do not compromise CO2 cuts in the power and industry sectors.

Christian Egenhofer, senior research fellow at the Centre for European Policy Studies (CEPS), called on the Commission to draw up a transport and climate change package comparable to that in place for energy and climate change policy. “This package must give answers to fundamental strategic questions about what a sustainable EU transport system should look like and how it can be achieved,” he said.

Detailing his priorities for the next five years, President Barroso pledged to move towards decarbonising all transport modes, including maritime and aviation. He also said the EU would press ahead with developing clean and electric cars.

Precautions to protect European industry

Nevertheless, national capitals are already anxious about protecting domestic industries in case an agreement in Copenhagen fails to reassure them that their main competitors will put similar climate policies in place.

France has already started pushing for carbon adjustment tariffs at the EU’s borders (EURACTIV 14/09/09). This would involve levying a CO2 tax on imports into the Union from regions that do not impose a carbon price on their industries.

Many EU member states are still apprehensive about the implications such a move would have on deadlocked global negotiations. They are concerned about a rebuke from nations like China, which could contest the tax as a protectionist measure under WTO rules.

But the French have legal arguments in favour of a CO2 tax, after the WTO this summer said such tariffs would be possible if designed properly. Germany has since joined its neighbour (EURACTIV 18/09/09), and the US is considering a similar measure as part of its draft climate bill.

In addition, the Commission will be busy designing the conditions under which industries deemed exposed to international competition can receive free permits to pollute. On 21 September, member states approved a list of industrial sectors that the EU executive deems to be in danger of relocating to areas without restrictions on emissions, dubbed “carbon leakage” (EURACTIV 21/09/09).

The next Commission will be busy setting the benchmarks according to which the number of free permits for each installation are calculated. As only the 10% most efficient installations will get all their allowances for free, a heated debate is expected as industries will try to secure as large a free allocation as possible.

Greenpeace argued that while Commission President Barroso's priorities for the next five years recognise the urgency of climate change, these will now have to be translated into policies.

The NGO urged the next Commission to launch a detailed blueprint on how to develop a "clean, smart and interconnected energy system" based on renewables and energy efficiency, with a full phase-out of coal and nuclear. In addition, it argued that the EU executive needs to curb growing emissions from transport, setting a binding CO2 target of 80g/km on passenger cars.

The Centre for European Policy Studies (CEPS) called on the Commission to address the lack of an integrated response to rising greenhouse gas emissions, security of energy supply issues and innovation challenges in the transport sector.

"The Commission should build political consensus on implementing alternative low-carbon transport options by bringing up their cost-effectiveness," said Christian Egenhofer, senior research fellow at CEPS.

"The transition towards an EU low-carbon transport system is a European task. One or several member states alone will not be able to do it on their own. It is therefore up to the European Commission to start working on the new transport and climate package," he concluded.

Friends of the Earth Europe (FoEE) urged the new Commission to strengthen its climate policies and take on an emission reduction target beyond the current pledge of 30% if other developed nations take on similar commitments. It argued that 40% domestic cuts by 2020 are possible in line with what science says is necessary to avoid disastrous climate change.

"The challenge for the new commission is to integrate aggressive but ambitious climate abatement measures across sectors and across the whole economy," said Esther Bollendorff, FoEE's climate and energy campaigner. 

José Manuel Barroso won unanimous backing from EU heads of state and government in June for a second five-year mandate at the head of the European Commission (EURACTIV 19/06/09). 

Their political support was formalised by written procedure on 9 July. Sweden, the current holder of the rotating EU presidency, had insisted on having Barroso re-appointed as soon as possible, arguing that in a time of crisis, the Union needs a Commission president who is fully in power (see EURACTIV LinksDossier on the Swedish EU Presidency). 

On 3 September, Barroso, having worked over the recess, sent his 41-page programme for the next five years to the political groups in the European Parliament (EURACTIV 03/09/09). This included plans to decarbonise the transport and electricity sectors and to retain leadership on climate change in the run-up to 2020 (EURACTIV 07/09/09).

On 16 September, MEPs gave Barroso the legitimacy to steer the European Commission for a second term in a secret ballot (EURACTIV 16/09/09).

On 8 September, Fondation EURACTIV held a workshop on the priorities for the next Commission under Chatham House rules
. As the new EU executive settles in, EURACTIV will continue to cover the new EU executive's work programme in its 
EU Priorities section and during 'Special Week' coverage of the Spanish EU Presidency (
see programme here

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