Hilary Benn to propose global action to secure food supplies as population booms – along with starvation
Juliette Jowit
guardian.co.uk, Wednesday December 10 2008 12.45 GMT
Britain and the world face a "perfect storm" of threats to food security unless world leaders agree a global deal to tackle rising prices and environmental damage, the environment secretary Hilary Benn will warn tonight.
Benn will say there are a range of threats to producing enough food to feed an expected global population of 9 billion people by the middle of this century and will call for an international agreement to tackle global warming.
Benn's speech to the Fabian Society in London comes just a day after the UN warned that the number of people facing starvation worldwide rose 40 million to 963 million during 2008, mostly as a result of rising food prices, which in turn have been blamed on soaring demand for crops for food and fuel, and higher oil costs. In the UK annual food prices were more than 10% higher during this summer, and the sector is a driver of overall national inflation of 4.4%, according to the Office for National Statistics.
"Global food production will need to double just to meet demand," Benn is expected to say. "We have the knowledge and the technology to do this, as things stand, but the perfect storm of climate change, environmental degradation and water and oil scarcity, threatens our ability to succeed."
In particular, the UK food system's "dependence on oil will have to change" to use more renewable energy. He also hints that more controversial genetically modified technology could also be needed, described as "new crops and technologies".
"As a world, we need to own up to the true scale of the problem," adds an advance copy of the speech. "And we need a long-term plan for dealing with it. We need... to create a kind of new Kyoto – a new global deal to secure the future of our food." A department spokesman said a global deal would need to cover environmental damage, food security and prices.
The speech is likely to be welcomed as recognition that the UK needs a firmer policy on food security. In 2006 Defra said food security was "not an issue of primary concern" in rich nations.
However the government should not rely on an international treaty instead of making changes to domestic policy, said Tim Lang, professor of food policy at City University in London.
Lang said it was essential to protect natural resources like water and soil, while also cutting meat and dairy production, freeing up land to grow more fruit and vegetables.
"We have got to decide whether we want cheap, unsustainable food or a sustainable food system," said Lang. "This is a new imperialism… we're using other people's land to feed ourselves, taking food out of the mouths of others."
In 2007 the UK produced 61% of the food it consumed, ranging from 100% of cereals to 10% of fruit.
Thursday, 11 December 2008
Europe agrees energy targets for 2020
The Times
December 10, 2008
David Charter and Lewis Smith
Targets for 20 per cent of Europe’s energy to come from renewable sources by 2020 were agreed after EU countries decided to reduce the role of biofuels over concerns about the impact of growing crops for fuel in developing countries.
In concessions to smooth the deal EU states that cannot afford to meet their own individual renewable energy targets will be able to outsource some of their efforts by sponsoring green projects in other countries or buying credits from those countries that have exceeded the goal.
Instead of a parallel target proposed last year for 10 per cent of transport fuel to come from biofuels, this goal will now include all methods of sustainable transport such as electric cars and trains, while aviation will be exempt, meeting concerns from Britain that fuel technology would not be ready in time.
Renewable energy targets are a major part of the EU’s massive climate change package, due to be signed off by leaders from the 27 nations at a summit in Brussels later this week. Each country will have its own share of the overall goal, with Britain obliged to move to 15 per cent of renewable energy from 3 per cent this year — a target expected to mean that more than 30 per cent of electricity will have to come from renewable sources, with thousands more wind turbines needed.
The only outstanding point of disagreement on the renewables package is Italy’s demand for a full review in 2014, which will be debated by EU leaders at their summit on Thursday and Friday. In another concession, EU countries that exceed their individual renewable target will be able to sell the premium to an EU member struggling to meet its own target.
But fierce wrangling is still going on over another key plank, the emissions trading scheme, with a group of eastern EU countries heavily dependent on coal power, led by Poland, arguing for big subsidies from western European nations.
Jose Manuel Barroso, the European Commission President, said that he hoped for a comprehensive deal including emission trading, which could then be extended to include North America. “If we reach agreement this week, we should propose a transatlantic emission market which should be the basis for a global carbon market,” he said.
In Poznan, Poland, where UN climate talks are under way, green groups were broadly content with the EU deal on renewable energy but voiced alarm at another part of the 2020 climate package to be agreed at the Brussels summit, so-called effort sharing.
This sets energy use reduction targets for sectors, accounting for 55 per cent of EU emissions, that are not covered by trading in carbon emissions, including agriculture, transport and households.
A coalition of environmental groups called this a farce because polluters could offset as much as two-thirds of their emissions by investing in clean-technology projects in poor countries.
“This proposal, steered by the self-interest of EU member states, sets the bar far too low,” said the coalition, called the Climate Action Network .
December 10, 2008
David Charter and Lewis Smith
Targets for 20 per cent of Europe’s energy to come from renewable sources by 2020 were agreed after EU countries decided to reduce the role of biofuels over concerns about the impact of growing crops for fuel in developing countries.
In concessions to smooth the deal EU states that cannot afford to meet their own individual renewable energy targets will be able to outsource some of their efforts by sponsoring green projects in other countries or buying credits from those countries that have exceeded the goal.
Instead of a parallel target proposed last year for 10 per cent of transport fuel to come from biofuels, this goal will now include all methods of sustainable transport such as electric cars and trains, while aviation will be exempt, meeting concerns from Britain that fuel technology would not be ready in time.
Renewable energy targets are a major part of the EU’s massive climate change package, due to be signed off by leaders from the 27 nations at a summit in Brussels later this week. Each country will have its own share of the overall goal, with Britain obliged to move to 15 per cent of renewable energy from 3 per cent this year — a target expected to mean that more than 30 per cent of electricity will have to come from renewable sources, with thousands more wind turbines needed.
The only outstanding point of disagreement on the renewables package is Italy’s demand for a full review in 2014, which will be debated by EU leaders at their summit on Thursday and Friday. In another concession, EU countries that exceed their individual renewable target will be able to sell the premium to an EU member struggling to meet its own target.
But fierce wrangling is still going on over another key plank, the emissions trading scheme, with a group of eastern EU countries heavily dependent on coal power, led by Poland, arguing for big subsidies from western European nations.
Jose Manuel Barroso, the European Commission President, said that he hoped for a comprehensive deal including emission trading, which could then be extended to include North America. “If we reach agreement this week, we should propose a transatlantic emission market which should be the basis for a global carbon market,” he said.
In Poznan, Poland, where UN climate talks are under way, green groups were broadly content with the EU deal on renewable energy but voiced alarm at another part of the 2020 climate package to be agreed at the Brussels summit, so-called effort sharing.
This sets energy use reduction targets for sectors, accounting for 55 per cent of EU emissions, that are not covered by trading in carbon emissions, including agriculture, transport and households.
A coalition of environmental groups called this a farce because polluters could offset as much as two-thirds of their emissions by investing in clean-technology projects in poor countries.
“This proposal, steered by the self-interest of EU member states, sets the bar far too low,” said the coalition, called the Climate Action Network .
BioFuel Resolves Hedging Loss Issues, Strikes Cargill Deal
By Jessica Resnick-Ault and Mara Lemos Stein
Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones)-- Ethanol producer BioFuel Energy Corp. (BIOF) struck a deal with key creditor Cargill Inc. late Wednesday, allowing BioFuel to continue to operate despite significant hedging losses.
Denver-based BioFuel incurred $70.6 million in hedging losses for the quarter ended Sept. 30. After corn prices hit a record high in June, many ethanol producers made risky bets in the corn market, which resulted in losses throughout the third quarter as corn prices declined.
While the agreement will allow BioFuel to continue to operate, the company expects to continue losing money, unless ethanol margins improve. "The company's ability to amortize debt or achieve profitability will depend upon improved industry margins," BioFuel said in its press release after the market closed Wednesday.
BioFuel and other ethanol companies have struggled recently after going public following U.S. legislation encouraging increased use of the corn-based fuel. Oversupply of the fuel and a slowdown in demand have squeezed producers in this volatile commodity business.
Following payments of an undisclosed sum, Cargill has agreed to accept an additional $11.4 million from BioFuel as total repayment for existing debt. BioFuel must pay an additional $20 million to two holders of its subordinated debt.
BioFuel has been unable to make timely payments to Cargill since August, and failed to meet a Sept. 30 deadline for paying interest on its subordinated debt to two other creditors.
The company and its creditors have come to an agreement in which the remaining amounts owed to Cargill and the debt holders will be paid back at 5% a year, effective Dec. 1.
Cargill has agreed to waive all interest through Nov. 30.
BioFuel shares closed up 7.5% to 43 cents in regular trading, and were down 7% to 40 cents after hours.
-By Jessica Resnick-Ault, Dow Jones Newswires; 201-938-4435; jessica.resnick-ault@dowjones.com; and Mara Lemos Stein, 201-938-2354; mara.lemos-stein@dowjones.com
Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones)-- Ethanol producer BioFuel Energy Corp. (BIOF) struck a deal with key creditor Cargill Inc. late Wednesday, allowing BioFuel to continue to operate despite significant hedging losses.
Denver-based BioFuel incurred $70.6 million in hedging losses for the quarter ended Sept. 30. After corn prices hit a record high in June, many ethanol producers made risky bets in the corn market, which resulted in losses throughout the third quarter as corn prices declined.
While the agreement will allow BioFuel to continue to operate, the company expects to continue losing money, unless ethanol margins improve. "The company's ability to amortize debt or achieve profitability will depend upon improved industry margins," BioFuel said in its press release after the market closed Wednesday.
BioFuel and other ethanol companies have struggled recently after going public following U.S. legislation encouraging increased use of the corn-based fuel. Oversupply of the fuel and a slowdown in demand have squeezed producers in this volatile commodity business.
Following payments of an undisclosed sum, Cargill has agreed to accept an additional $11.4 million from BioFuel as total repayment for existing debt. BioFuel must pay an additional $20 million to two holders of its subordinated debt.
BioFuel has been unable to make timely payments to Cargill since August, and failed to meet a Sept. 30 deadline for paying interest on its subordinated debt to two other creditors.
The company and its creditors have come to an agreement in which the remaining amounts owed to Cargill and the debt holders will be paid back at 5% a year, effective Dec. 1.
Cargill has agreed to waive all interest through Nov. 30.
BioFuel shares closed up 7.5% to 43 cents in regular trading, and were down 7% to 40 cents after hours.
-By Jessica Resnick-Ault, Dow Jones Newswires; 201-938-4435; jessica.resnick-ault@dowjones.com; and Mara Lemos Stein, 201-938-2354; mara.lemos-stein@dowjones.com
Obama's US sets the recession-fighting tone and Barroso's EU can only follow
The European commission president is fooling himself with claims that the Americans are coming round to Europeans' way of thinking on the recession and climate change
David Gow in Brussels
guardian.co.uk, Wednesday December 10 2008 11.33 GMT
European commission president José Manuel Barroso. Photograph: Lefteris Pitarakis/AFP
Back in a dark and gloomy EU capital swept by snow and sleet after a sunny week in high-altitude New Mexico and there's palpable hubris in the air.
Europe has persuaded itself it has led the world in solving the banking crisis; now it thinks it can show Barack Obama how to reboot the global economy out of recession.
Ahead of a crucial EU summit this week, José Manuel Barroso, the European commission president, offered the US president-elect a transatlantic economic pact, a joint platform based on European ideas of how to stimulate the economy.
The Americans, an unusually combative Barroso opined, are coming round to Europeans' way of thinking — and not just on the recession but on climate change, with Obama set to adopt a cap-and-trade system for reducing carbon emissions pioneered by the EU.
His assertion of European power, both of ideas and policies, coincided with a series of papers from thinktanks such as the European Council on Foreign Relations (www.ecfr.eu) and Centre for European Reform (www.cer.org.uk) urging a "rewiring" of the US-EU relationship under Obama.
Sad to say but all these ambitious dreams are likely to be dashed. In New Mexico, a Republican red state turned Democrat blue on a huge popular swing on November 4, most people had never heard of Belgium or knew where it was located and the EU was an unknown entity.
What was the price of gas in Europe, they asked as they filled their pick-ups and SUVs at $1.60 a gallon (compared with $4 in the summer). $7 or $8 a gallon? Crazy, we'd riot at those prices. Oh, and isn't Europe being overtaken by Islamic terrorists?
Europe simply doesn't figure on the New Mexican radar screen. Instead, the crowds watching the lighting of the Christmas tree and children dancing the flamenco near the plaza in Albuquerque's old town or the few shoppers in Native American stores in upstate Taos are banking on Obama to lead them out of the crisis. So, one suspects, are a lot of Europeans.
Expectations of the first African-American to occupy the White House are as high — and burdensome — among largely respectful Americans as among the 200,000 over-joyed Germans and other Europeans who thronged the Victory Pillar in Berlin in early summer to hear him promise a new, multipolar start in US foreign relations.
He has already made an impressive start in the transition, setting the strict parameters for the bailout of the auto industry, and there are plenty of reasons for thinking it is he, rather than Gordon, Nicholas or Angela, let alone José, who will continue to set the tone in the coming months.
First, it is clear that EU leaders are divided among themselves about how to tackle the recession. For all the talk about the EC's €200bn (£175bn) stimulus package being a "toolbox" of measures for the 27 governments to choose, there is little or no sense of coordination.
Rather, it seems as if Germany, the EU's biggest economy yet pilloried so far for the paucity of its stimulus package, is waiting for an Obama lead before rebooting it, possibly with tax cuts. And it's not the only country to lie in waiting for the word from the White House and the Hill.
So far, Obama has talked of a $500bn stimulus package and maybe one twice as large despite the huge budget deficit he will inherit from Bush. Barroso is right to say it contains similar elements as the EC's plan: public investment in infrastructure, green technologies, innovation and energy efficiency.
He is also right to say US infrastructure, notably its power grids and schools, lags far behind that of a modernised EU. But he clearly underestimates the sheer scale of the likely Obama package: already up to three times that of the EC plan for stimulating a European economy that is $3tn larger than the US (on CIA figures for 2007). And, like Bush's discredited team, Obama will look more to Beijing, with its mammoth package, than to Brussels, centre of what the National Intelligence Council calls a "hobbled giant" in a paper the new president is bound to have studied.
Second, the new president is likely to dash EU hopes for a breakthrough in global trade liberalisation talks — the so-called Doha round — despite the push given at the G20 summit in Washington in mid-November. The US farm lobby, the 22 senators from farm states and, not least, Obama's base in Illinois, the second biggest of those farm states, point to a failure of the seven-year-old talks.
It's not that the new president is protectionist or ignores the dreadful import of the 1930 Smoot-Hawley Tarrif Act that provoked the Great Depression. Indeed, his centrist cabinet appointments, not least that of New Mexico governor Bill Richardson to head the commerce department, signal a pro-free trade stance. But, among all the conflicts of interest he'll have to balance, Doha may prove expendable.
Third, for all of Barroso's fine talk of the EU's continuing ambition to lead the world in fighting climate change and of the congruence of economic stimulus and low-carbon sustainability, there's plenty of evidence that Europe's own policies are in some disarray.
The keynote emissions trading scheme, supposedly the model for Obama's cap-and-trade plan, is at risk of being watered down, under business and national pressure, to the point of meaninglessness as countries and industries are granted exemptions from proposed auctions of carbon allowances. Countries such as the UK are also hoping to meet much of their green targets through projects in emerging economies or developing countries.
Obama's own $150bn plan to invest in new energy-saving technologies and slash CO2 emissions by 80% by 2050, along with his plans to create 2.5m jobs, owe more to Arnold Schwarzenegger of California than to Stavros Dimas of the EC.
The new US president, with his unruffled calm, embodies America's "can do" approach to life and its problems. Europe, a bigger bloc of 500m disparate peoples and cultures, has yet to walk the talk. It still waits for its lead to come from Washington.
David Gow in Brussels
guardian.co.uk, Wednesday December 10 2008 11.33 GMT
European commission president José Manuel Barroso. Photograph: Lefteris Pitarakis/AFP
Back in a dark and gloomy EU capital swept by snow and sleet after a sunny week in high-altitude New Mexico and there's palpable hubris in the air.
Europe has persuaded itself it has led the world in solving the banking crisis; now it thinks it can show Barack Obama how to reboot the global economy out of recession.
Ahead of a crucial EU summit this week, José Manuel Barroso, the European commission president, offered the US president-elect a transatlantic economic pact, a joint platform based on European ideas of how to stimulate the economy.
The Americans, an unusually combative Barroso opined, are coming round to Europeans' way of thinking — and not just on the recession but on climate change, with Obama set to adopt a cap-and-trade system for reducing carbon emissions pioneered by the EU.
His assertion of European power, both of ideas and policies, coincided with a series of papers from thinktanks such as the European Council on Foreign Relations (www.ecfr.eu) and Centre for European Reform (www.cer.org.uk) urging a "rewiring" of the US-EU relationship under Obama.
Sad to say but all these ambitious dreams are likely to be dashed. In New Mexico, a Republican red state turned Democrat blue on a huge popular swing on November 4, most people had never heard of Belgium or knew where it was located and the EU was an unknown entity.
What was the price of gas in Europe, they asked as they filled their pick-ups and SUVs at $1.60 a gallon (compared with $4 in the summer). $7 or $8 a gallon? Crazy, we'd riot at those prices. Oh, and isn't Europe being overtaken by Islamic terrorists?
Europe simply doesn't figure on the New Mexican radar screen. Instead, the crowds watching the lighting of the Christmas tree and children dancing the flamenco near the plaza in Albuquerque's old town or the few shoppers in Native American stores in upstate Taos are banking on Obama to lead them out of the crisis. So, one suspects, are a lot of Europeans.
Expectations of the first African-American to occupy the White House are as high — and burdensome — among largely respectful Americans as among the 200,000 over-joyed Germans and other Europeans who thronged the Victory Pillar in Berlin in early summer to hear him promise a new, multipolar start in US foreign relations.
He has already made an impressive start in the transition, setting the strict parameters for the bailout of the auto industry, and there are plenty of reasons for thinking it is he, rather than Gordon, Nicholas or Angela, let alone José, who will continue to set the tone in the coming months.
First, it is clear that EU leaders are divided among themselves about how to tackle the recession. For all the talk about the EC's €200bn (£175bn) stimulus package being a "toolbox" of measures for the 27 governments to choose, there is little or no sense of coordination.
Rather, it seems as if Germany, the EU's biggest economy yet pilloried so far for the paucity of its stimulus package, is waiting for an Obama lead before rebooting it, possibly with tax cuts. And it's not the only country to lie in waiting for the word from the White House and the Hill.
So far, Obama has talked of a $500bn stimulus package and maybe one twice as large despite the huge budget deficit he will inherit from Bush. Barroso is right to say it contains similar elements as the EC's plan: public investment in infrastructure, green technologies, innovation and energy efficiency.
He is also right to say US infrastructure, notably its power grids and schools, lags far behind that of a modernised EU. But he clearly underestimates the sheer scale of the likely Obama package: already up to three times that of the EC plan for stimulating a European economy that is $3tn larger than the US (on CIA figures for 2007). And, like Bush's discredited team, Obama will look more to Beijing, with its mammoth package, than to Brussels, centre of what the National Intelligence Council calls a "hobbled giant" in a paper the new president is bound to have studied.
Second, the new president is likely to dash EU hopes for a breakthrough in global trade liberalisation talks — the so-called Doha round — despite the push given at the G20 summit in Washington in mid-November. The US farm lobby, the 22 senators from farm states and, not least, Obama's base in Illinois, the second biggest of those farm states, point to a failure of the seven-year-old talks.
It's not that the new president is protectionist or ignores the dreadful import of the 1930 Smoot-Hawley Tarrif Act that provoked the Great Depression. Indeed, his centrist cabinet appointments, not least that of New Mexico governor Bill Richardson to head the commerce department, signal a pro-free trade stance. But, among all the conflicts of interest he'll have to balance, Doha may prove expendable.
Third, for all of Barroso's fine talk of the EU's continuing ambition to lead the world in fighting climate change and of the congruence of economic stimulus and low-carbon sustainability, there's plenty of evidence that Europe's own policies are in some disarray.
The keynote emissions trading scheme, supposedly the model for Obama's cap-and-trade plan, is at risk of being watered down, under business and national pressure, to the point of meaninglessness as countries and industries are granted exemptions from proposed auctions of carbon allowances. Countries such as the UK are also hoping to meet much of their green targets through projects in emerging economies or developing countries.
Obama's own $150bn plan to invest in new energy-saving technologies and slash CO2 emissions by 80% by 2050, along with his plans to create 2.5m jobs, owe more to Arnold Schwarzenegger of California than to Stavros Dimas of the EC.
The new US president, with his unruffled calm, embodies America's "can do" approach to life and its problems. Europe, a bigger bloc of 500m disparate peoples and cultures, has yet to walk the talk. It still waits for its lead to come from Washington.
Obama Picks Team to Guide Energy, Environment Agendas
By JONATHAN WEISMAN and STEPHEN POWER
President-elect Barack Obama has picked a Nobel laureate, a former Environmental Protection Agency administrator, and officials from New Jersey and Los Angeles to run his energy and environmental initiatives, putting heft into roles likely to dominate domestic policy in his first years in office.
Associated Press
Steven Chu, 60 years old, director of the Lawrence Berkeley National Laboratory and a Nobel Prize-winning physicist, will be nominated as secretary of energy, Democratic officials said Wednesday. Carol Browner, 52, who headed the EPA under President Bill Clinton, will coordinate energy policy from the White House in a new "energy czar" role.
Lisa Jackson, 46, a former environmental-policy official in New Jersey, will be EPA administrator, and Los Angeles Deputy Mayor Nancy Sutley is to be named chairwoman of the president's Council on Environmental Quality.
With the appointments and nominations, Mr. Obama is signaling his seriousness about combating climate change by curbing emissions of greenhouse gases and spending heavily to boost energy efficiency and promote renewable energy.
Obama's Advisers
President-elect Barack Obama has named his choices for some key jobs in his administration, and other announcements are expected soon.
He also appears to be moving to the left with some of his new choices -- at least on business issues -- after his early cabinet choices were widely seen as centrist and moderate. "What you've got are people who are committed to moving forward with regulation of greenhouse gases under the Clean Air Act, which we believe is a huge mistake," William Kovacs, vice president of the U.S. Chamber of Commerce, said in an interview. "If we're embarking on a new infrastructure program that's going to involve building a lot of roads and bridges, the last thing we want to do is hold it up with CO2 regulations."
The choice of Ms. Browner is particularly significant because the new post is expected to coordinate the many federal agencies that have a hand in energy policy. Ms. Browner has said publicly that the next president's priority should be to direct the EPA to reconsider the decision by President George W. Bush's current administrator, Stephen Johnson, to deny California a waiver from the Clean Air Act that would have allowed the state to regulate greenhouse-gas emissions from automobiles.
The auto industry and the United Auto Workers union have aggressively opposed such state-level controls.
Ms. Browner also has called for letting the EPA reconsider whether greenhouse gases "endanger" health or welfare -- the legal trigger for regulating them under the Clean Air Act. The EPA last year tentatively concluded that such emissions do endanger welfare, but later opted not to make the finding official. Business groups are lobbying the agency not to try to regulate such emissions under the Clean Air Act, warning it will lead to a cascade of unintended regulatory consequences covering bakeries, breweries, schools, places of worship and other relatively small emitters.
Carol Browner, head of the EPA under President Clinton, was picked to be 'energy czar' in the Obama White House.
Ms. Jackson -- currently chief of staff to Gov. Jon Corzine of New Jersey -- previously was commissioner of the New Jersey Department of Environmental Protection. A New Orleans native, she has led New Jersey's efforts to regulate greenhouse-gas emissions from automobiles and other sources. She is the third African-American nominated for a cabinet post, following United Nations Ambassador-nominee Susan Rice and Attorney General-nominee Eric Holder.
Officials familiar with the selections say Mr. Chu is likely to focus his attention on the Energy Department's core missions: basic science, nuclear weapons and cleaning up a nuclear-weapons manufacturing complex contaminated since the Cold War. Ms. Browner will coordinate renewable energy and energy efficiency policy from the White House, two areas that will feature prominently in a half-trillion-dollar economic-stimulus plan the new president hopes to sign into law as soon as he is inaugurated.
Mr. Chu brings sterling credentials as a scientist to a job that often has gone to former politicians. As an Asian-American, he also brings more ethnic diversity. He would inherit an agency that, despite its name, has little power to set energy policy, compared with agencies such as the Environmental Protection Agency, which regulates air quality, and the Transportation Department, which sets automobile fuel-efficiency standards.—Ian Talley and Neil King Jr. contributed to this article.
Write to Jonathan Weisman at jonathan.weisman@wsj.com and Stephen Power at stephen.power@wsj.com
President-elect Barack Obama has picked a Nobel laureate, a former Environmental Protection Agency administrator, and officials from New Jersey and Los Angeles to run his energy and environmental initiatives, putting heft into roles likely to dominate domestic policy in his first years in office.
Associated Press
Steven Chu, 60 years old, director of the Lawrence Berkeley National Laboratory and a Nobel Prize-winning physicist, will be nominated as secretary of energy, Democratic officials said Wednesday. Carol Browner, 52, who headed the EPA under President Bill Clinton, will coordinate energy policy from the White House in a new "energy czar" role.
Lisa Jackson, 46, a former environmental-policy official in New Jersey, will be EPA administrator, and Los Angeles Deputy Mayor Nancy Sutley is to be named chairwoman of the president's Council on Environmental Quality.
With the appointments and nominations, Mr. Obama is signaling his seriousness about combating climate change by curbing emissions of greenhouse gases and spending heavily to boost energy efficiency and promote renewable energy.
Obama's Advisers
President-elect Barack Obama has named his choices for some key jobs in his administration, and other announcements are expected soon.
He also appears to be moving to the left with some of his new choices -- at least on business issues -- after his early cabinet choices were widely seen as centrist and moderate. "What you've got are people who are committed to moving forward with regulation of greenhouse gases under the Clean Air Act, which we believe is a huge mistake," William Kovacs, vice president of the U.S. Chamber of Commerce, said in an interview. "If we're embarking on a new infrastructure program that's going to involve building a lot of roads and bridges, the last thing we want to do is hold it up with CO2 regulations."
The choice of Ms. Browner is particularly significant because the new post is expected to coordinate the many federal agencies that have a hand in energy policy. Ms. Browner has said publicly that the next president's priority should be to direct the EPA to reconsider the decision by President George W. Bush's current administrator, Stephen Johnson, to deny California a waiver from the Clean Air Act that would have allowed the state to regulate greenhouse-gas emissions from automobiles.
The auto industry and the United Auto Workers union have aggressively opposed such state-level controls.
Ms. Browner also has called for letting the EPA reconsider whether greenhouse gases "endanger" health or welfare -- the legal trigger for regulating them under the Clean Air Act. The EPA last year tentatively concluded that such emissions do endanger welfare, but later opted not to make the finding official. Business groups are lobbying the agency not to try to regulate such emissions under the Clean Air Act, warning it will lead to a cascade of unintended regulatory consequences covering bakeries, breweries, schools, places of worship and other relatively small emitters.
Carol Browner, head of the EPA under President Clinton, was picked to be 'energy czar' in the Obama White House.
Ms. Jackson -- currently chief of staff to Gov. Jon Corzine of New Jersey -- previously was commissioner of the New Jersey Department of Environmental Protection. A New Orleans native, she has led New Jersey's efforts to regulate greenhouse-gas emissions from automobiles and other sources. She is the third African-American nominated for a cabinet post, following United Nations Ambassador-nominee Susan Rice and Attorney General-nominee Eric Holder.
Officials familiar with the selections say Mr. Chu is likely to focus his attention on the Energy Department's core missions: basic science, nuclear weapons and cleaning up a nuclear-weapons manufacturing complex contaminated since the Cold War. Ms. Browner will coordinate renewable energy and energy efficiency policy from the White House, two areas that will feature prominently in a half-trillion-dollar economic-stimulus plan the new president hopes to sign into law as soon as he is inaugurated.
Mr. Chu brings sterling credentials as a scientist to a job that often has gone to former politicians. As an Asian-American, he also brings more ethnic diversity. He would inherit an agency that, despite its name, has little power to set energy policy, compared with agencies such as the Environmental Protection Agency, which regulates air quality, and the Transportation Department, which sets automobile fuel-efficiency standards.—Ian Talley and Neil King Jr. contributed to this article.
Write to Jonathan Weisman at jonathan.weisman@wsj.com and Stephen Power at stephen.power@wsj.com
Carbon capture funding row looms at Euro summit
Brussels showdown expected as nations argue over how to pay for technology to bury greenhouse gases
David Gow and Alok Jha
guardian.co.uk, Wednesday December 10 2008 17.46 GMT
Gordon Brown faces a bruising battle at Thursday's EU summit to persuade his fellow European leaders to back his proposal for subsidies to kickstart carbon capture and storage (CCS).
He wants more than 10bn euros for the technology, which would bury the emissions from burning fossil fuels, preventing them from contributing to global warming.
CCS is a key element of the climate package EU leaders are battling over, which aims to ensure the bloc meets its ambitious carbon-cut targets of 20% by 2020. The British prime minister is demanding that the EU sets aside 500m pollution permits from a special pot under the emissions trading scheme (ETS) to provide as much as 15bn euros to fund up to 12 CCS demonstration projects by 2015.
But it emerged on Wednesday that the French, who will chair the two-day summit, are proposing that only 150m permits – worth roughly 2bn euros – be allocated. A majority of the EU's 27 countries is willing to support only a maximum of 200m permits, senior diplomats said.
Chris Davies, Liberal Democrat MEP and chief European parliamentary negotiator on CCS, said MEPs would insist on obtaining their "final offer" of 350m permits. "The endgame on this critical issue takes place over the next 24 hours," Davies said. "The UK government has to be as belligerent as other governments on other issues in getting its way on this." The European parliament will meet on Saturday to assess the outcome – and could vote down the entire climate change package.
CCS takes CO2 from power stations and heavy industrial plants and stores it in underground rock formations. It is viewed as a key but controversial element of global efforts to combat global warming, as it would allow the continued heavy use of coal for power. The incoming Obama administration in the US, which backs it, is looking to the EU for a lead. On the eve of the summit, energy companies and green groups joined to urge the EU to commit the required funding, arguing that it is vital if Europe is to meet its emissions reduction targets and could create many tens of thousands of new jobs.
But Britain, as of Wednesday, can count on the support of only Poland, the Netherlands and, perhaps, the Czech Republic for its stand. Davies, however, suggested that Germany and Italy could be brought on board – if they win key concessions on other issues in the typical horse-trading at EU summits. "The government should treat this as a deal-breaker," he said. "There's no way 150m permits can pay for the full range of demonstration projects."
Some countries, such as Germany, are insisting that funding be taken from the existing EU budget, with each state paying its share according to GDP. Others, aware that none of the projects will be handed to them, are said to be digging in their heels over such subsidies. Poland, heavily dependent on coal, wants two of the projects for itself.
The International Energy Agency (IEA) predicts the world's use of power will increase by 50% by 2030, with 77% of that coming from fossil fuels. CCS technologies promise to trap up to 90% of the associated CO2 emissions. As such, it could be a vital tool for countries such as China, where the government's economic growth and poverty reduction targets depend on building huge numbers of coal-fired power stations.
"It is absolutely imperative that the heads of government commit to supporting the funding necessary to ensure that the demonstration projects can be operational by 2015," said Joan MacNaughton, formerly an adviser to the UK government on energy and now senior vice president of power and environmental policies at French engineering company Alstom.
Though each element of the CCS process is already proven and in use, until now no one has demonstrated a full-scale system – largely because developing it is likely to be very expensive. Many leading power companies have been reluctant to fund CCS individually, arguing that governments should shoulder some of the financial risks.
Whatever the EU decides, said Stuart Haszeldine, a geologist at the University of Edinburgh and an expert on CCS, projects will go ahead regardless in Norway, Australia, Canada and US, leaving the rest of Europe behind. "It would be very embarrassing for Europe not to do anything. It's not the end, but it means the ability to deliver the 2°C climate target, which Europe has always says is its top-level policy, the ability to deliver that becomes vanishingly small the longer this drags on."
In their letter, the environment and energy groups' coalition cited a study by the IEA, which pointed out that the the window of opportunity for CCS to make a material impact on climate change was closing. "Now is the time to act. Every day that full-scale demonstration of CCS is delayed, we lock in new CO2 emissions and make the challenge of meeting our CO2 targets harder."
Explainer: How carbon is captured and stored
David Gow and Alok Jha
guardian.co.uk, Wednesday December 10 2008 17.46 GMT
Gordon Brown faces a bruising battle at Thursday's EU summit to persuade his fellow European leaders to back his proposal for subsidies to kickstart carbon capture and storage (CCS).
He wants more than 10bn euros for the technology, which would bury the emissions from burning fossil fuels, preventing them from contributing to global warming.
CCS is a key element of the climate package EU leaders are battling over, which aims to ensure the bloc meets its ambitious carbon-cut targets of 20% by 2020. The British prime minister is demanding that the EU sets aside 500m pollution permits from a special pot under the emissions trading scheme (ETS) to provide as much as 15bn euros to fund up to 12 CCS demonstration projects by 2015.
But it emerged on Wednesday that the French, who will chair the two-day summit, are proposing that only 150m permits – worth roughly 2bn euros – be allocated. A majority of the EU's 27 countries is willing to support only a maximum of 200m permits, senior diplomats said.
Chris Davies, Liberal Democrat MEP and chief European parliamentary negotiator on CCS, said MEPs would insist on obtaining their "final offer" of 350m permits. "The endgame on this critical issue takes place over the next 24 hours," Davies said. "The UK government has to be as belligerent as other governments on other issues in getting its way on this." The European parliament will meet on Saturday to assess the outcome – and could vote down the entire climate change package.
CCS takes CO2 from power stations and heavy industrial plants and stores it in underground rock formations. It is viewed as a key but controversial element of global efforts to combat global warming, as it would allow the continued heavy use of coal for power. The incoming Obama administration in the US, which backs it, is looking to the EU for a lead. On the eve of the summit, energy companies and green groups joined to urge the EU to commit the required funding, arguing that it is vital if Europe is to meet its emissions reduction targets and could create many tens of thousands of new jobs.
But Britain, as of Wednesday, can count on the support of only Poland, the Netherlands and, perhaps, the Czech Republic for its stand. Davies, however, suggested that Germany and Italy could be brought on board – if they win key concessions on other issues in the typical horse-trading at EU summits. "The government should treat this as a deal-breaker," he said. "There's no way 150m permits can pay for the full range of demonstration projects."
Some countries, such as Germany, are insisting that funding be taken from the existing EU budget, with each state paying its share according to GDP. Others, aware that none of the projects will be handed to them, are said to be digging in their heels over such subsidies. Poland, heavily dependent on coal, wants two of the projects for itself.
The International Energy Agency (IEA) predicts the world's use of power will increase by 50% by 2030, with 77% of that coming from fossil fuels. CCS technologies promise to trap up to 90% of the associated CO2 emissions. As such, it could be a vital tool for countries such as China, where the government's economic growth and poverty reduction targets depend on building huge numbers of coal-fired power stations.
"It is absolutely imperative that the heads of government commit to supporting the funding necessary to ensure that the demonstration projects can be operational by 2015," said Joan MacNaughton, formerly an adviser to the UK government on energy and now senior vice president of power and environmental policies at French engineering company Alstom.
Though each element of the CCS process is already proven and in use, until now no one has demonstrated a full-scale system – largely because developing it is likely to be very expensive. Many leading power companies have been reluctant to fund CCS individually, arguing that governments should shoulder some of the financial risks.
Whatever the EU decides, said Stuart Haszeldine, a geologist at the University of Edinburgh and an expert on CCS, projects will go ahead regardless in Norway, Australia, Canada and US, leaving the rest of Europe behind. "It would be very embarrassing for Europe not to do anything. It's not the end, but it means the ability to deliver the 2°C climate target, which Europe has always says is its top-level policy, the ability to deliver that becomes vanishingly small the longer this drags on."
In their letter, the environment and energy groups' coalition cited a study by the IEA, which pointed out that the the window of opportunity for CCS to make a material impact on climate change was closing. "Now is the time to act. Every day that full-scale demonstration of CCS is delayed, we lock in new CO2 emissions and make the challenge of meeting our CO2 targets harder."
Explainer: How carbon is captured and stored
Greenwash: Are carbon offsetters ripping you off?
The cost of offsetting your carbon emissions produced when you fly varies wildly. Fred Pearce asks: genuine error or a convenient con-trick?
Fred Pearce
guardian.co.uk, Thursday December 11 2008 12.00 GMT
Flying somewhere this Christmas, or planning a ski trip? Arguably, given the carbon emissions involved, you just shouldn't.
But if you do, will you offset those flight emissions? Some people fuss that the offset companies are a green con. How do we know the trees we pay for won't die? Are we just subsidising renewable energy projects that were going to happen anyway?
Fair questions. But questions for another day. I have another problem. Why does the price of offsetting vary so much? Are we being ripped off?
Spend even a few minutes searching the internet offsetters and you will find two things. First, the prices charged for offsetting every tonne of CO2 you emit vary hugely. Second, the offsetters can't even agree on how great your emissions are for any particular flight.
Let's start with ClimateCare, based in Oxford. I have offset with them before, because I like the people and the projects. For a return economy flight from Heathrow to JFK in New York, they reckon my emissions are 1.53 tonnes. Earlier this week they wanted to charge me nearly £9 a tonne, making a total of £13.22. Type in your credit card details and it's done. Your money goes to fund some cooking stoves in Cambodia or wind turbines in Inner Mongolia.
But a more or less random sample of other offsetters this week provided me with some very different offers. The London-based CarbonNeutral company and Carbonpassport in Glasgow both say my New York return journey emits just over 1.3 tonnes. Terrapass in San Francisco puts it at just 0.84 tonnes. While Atmosfair in Berlin suggests I will be responsible for 3.48 tonnes. All are measuring the CO2 the same way; all are assuming a regular economy flight. The differences are baffling.
Then there is the price charged per tonne, which ranges from £17.50 at Carbonpassport to only half that with CarbonNeutral.
Put it all together, and Terrapass swears that I can offset my transatlantic hop with them for a measly $11.90 or £8.00. CarbonNeutral sound competitive at £11.90. But Atmosfairs wants 81 euros, or £69.85.
And my spot survey didn't find the full range. A couple of weeks ago, Paul Hooper of Manchester Metropolitan University's centre for air transport and the environment published his own study, conducted last winter, of more than 42 online offsetters. He found a sixfold difference in the price charged per tonne of carbon emitted. And, taking in the higher charges that some offsetting companies make for a bigger, business- or first-class seat, discovered price tags for a return trip from London to Sydney that ranged from £9.48 to a staggering £643.39, almost a 70-fold difference.
Now, if I was buying a laptop or something and got offered such a range of prices, I'd probably just pay the least and send it back if it didn't work. But with offsets, there is nothing to take out of the box. At the end of the day, I have no real idea what exactly it is that I have bought. And maybe it is ethically better to pay more. The offsetters are all supposed to be good guys, doing their bit for the planet, after all. The more money they get, the more they can help. But maybe not.
So what's going on? I'm still not quite sure why some companies reckon they can absorb a tonne of carbon so much more cheaply than others. I'd welcome inside information on this from any companies not delivering.
But after a bit of pestering, I have established why they can't agree on the mileage. There are a few technical things like how full you assume the plane is. And maybe the odd discrepancy over flight routes and aircraft type. New planes generally emit less. But the big difference is a scientific disagreement.
It turns out that the companies with low emission estimates simply calculate how much carbon dioxide planes kick out of their engines per passenger-kilometre. But the rest try to factor in other emissions from the engines that also add to the global warming. Things like the contrails and the nitrous oxide emissions that do a bunch of different things to atmospheric chemistry that I won't go into here.
The problem is that factoring these in is complicated. There is no single answer. Some companies reckon these emissions double the global warming effect. Some triple it. Some go even higher.
This is because the answer depends on timescales. If you mostly care about the short-term effects over the next decade or so, then these other gases are big players. But if you have your ambitions set on protecting the climate for your grandchildren, then they will have long since gone, while the CO2 will still be hanging round in the atmosphere. You would have thought the offsetting companies might have come up with some agreed rules about how to measure the overall global warming impact of greenhouse gases. But they haven't. Instead confusion reigns.
Once, we might have shaken our heads indulgently, thinking that at least they are encouraging us to cough up our cash for good projects that somewhere along the line will help clean up the atmosphere. Maybe the details don't matter too much. After all, you wouldn't insist on personally checking the health of an Oxfam goat before giving that to your nearest and dearest for Christmas.
But in recent months, there has been a shake-down in the carbon offsetting business. The start-ups are being taken over. The enthusiasts in cardigans and riding bicycles are giving way to money men in sharp suits driving limos. A few months ago my own favourite, ClimateCare, got gobbled up by Wall Street investment bank JPMorgan. Call me prejudiced, but suddenly I don't want to give them the benefit of the doubt any more.
Fred Pearce
guardian.co.uk, Thursday December 11 2008 12.00 GMT
Flying somewhere this Christmas, or planning a ski trip? Arguably, given the carbon emissions involved, you just shouldn't.
But if you do, will you offset those flight emissions? Some people fuss that the offset companies are a green con. How do we know the trees we pay for won't die? Are we just subsidising renewable energy projects that were going to happen anyway?
Fair questions. But questions for another day. I have another problem. Why does the price of offsetting vary so much? Are we being ripped off?
Spend even a few minutes searching the internet offsetters and you will find two things. First, the prices charged for offsetting every tonne of CO2 you emit vary hugely. Second, the offsetters can't even agree on how great your emissions are for any particular flight.
Let's start with ClimateCare, based in Oxford. I have offset with them before, because I like the people and the projects. For a return economy flight from Heathrow to JFK in New York, they reckon my emissions are 1.53 tonnes. Earlier this week they wanted to charge me nearly £9 a tonne, making a total of £13.22. Type in your credit card details and it's done. Your money goes to fund some cooking stoves in Cambodia or wind turbines in Inner Mongolia.
But a more or less random sample of other offsetters this week provided me with some very different offers. The London-based CarbonNeutral company and Carbonpassport in Glasgow both say my New York return journey emits just over 1.3 tonnes. Terrapass in San Francisco puts it at just 0.84 tonnes. While Atmosfair in Berlin suggests I will be responsible for 3.48 tonnes. All are measuring the CO2 the same way; all are assuming a regular economy flight. The differences are baffling.
Then there is the price charged per tonne, which ranges from £17.50 at Carbonpassport to only half that with CarbonNeutral.
Put it all together, and Terrapass swears that I can offset my transatlantic hop with them for a measly $11.90 or £8.00. CarbonNeutral sound competitive at £11.90. But Atmosfairs wants 81 euros, or £69.85.
And my spot survey didn't find the full range. A couple of weeks ago, Paul Hooper of Manchester Metropolitan University's centre for air transport and the environment published his own study, conducted last winter, of more than 42 online offsetters. He found a sixfold difference in the price charged per tonne of carbon emitted. And, taking in the higher charges that some offsetting companies make for a bigger, business- or first-class seat, discovered price tags for a return trip from London to Sydney that ranged from £9.48 to a staggering £643.39, almost a 70-fold difference.
Now, if I was buying a laptop or something and got offered such a range of prices, I'd probably just pay the least and send it back if it didn't work. But with offsets, there is nothing to take out of the box. At the end of the day, I have no real idea what exactly it is that I have bought. And maybe it is ethically better to pay more. The offsetters are all supposed to be good guys, doing their bit for the planet, after all. The more money they get, the more they can help. But maybe not.
So what's going on? I'm still not quite sure why some companies reckon they can absorb a tonne of carbon so much more cheaply than others. I'd welcome inside information on this from any companies not delivering.
But after a bit of pestering, I have established why they can't agree on the mileage. There are a few technical things like how full you assume the plane is. And maybe the odd discrepancy over flight routes and aircraft type. New planes generally emit less. But the big difference is a scientific disagreement.
It turns out that the companies with low emission estimates simply calculate how much carbon dioxide planes kick out of their engines per passenger-kilometre. But the rest try to factor in other emissions from the engines that also add to the global warming. Things like the contrails and the nitrous oxide emissions that do a bunch of different things to atmospheric chemistry that I won't go into here.
The problem is that factoring these in is complicated. There is no single answer. Some companies reckon these emissions double the global warming effect. Some triple it. Some go even higher.
This is because the answer depends on timescales. If you mostly care about the short-term effects over the next decade or so, then these other gases are big players. But if you have your ambitions set on protecting the climate for your grandchildren, then they will have long since gone, while the CO2 will still be hanging round in the atmosphere. You would have thought the offsetting companies might have come up with some agreed rules about how to measure the overall global warming impact of greenhouse gases. But they haven't. Instead confusion reigns.
Once, we might have shaken our heads indulgently, thinking that at least they are encouraging us to cough up our cash for good projects that somewhere along the line will help clean up the atmosphere. Maybe the details don't matter too much. After all, you wouldn't insist on personally checking the health of an Oxfam goat before giving that to your nearest and dearest for Christmas.
But in recent months, there has been a shake-down in the carbon offsetting business. The start-ups are being taken over. The enthusiasts in cardigans and riding bicycles are giving way to money men in sharp suits driving limos. A few months ago my own favourite, ClimateCare, got gobbled up by Wall Street investment bank JPMorgan. Call me prejudiced, but suddenly I don't want to give them the benefit of the doubt any more.
UN Climate Change Conference will produce enough CO2 to fill 150 buses
An international climate change conference will produce the same amount of carbon dioxide as 2,200 homes produce in a year.
By Louise Gray, Environment Correspondent Last Updated: 6:14PM GMT 10 Dec 2008
Representatives from 192 countries as well as environmental groups, aid agencies and industry groups have gathered in Poznan, Poland for the UN Climate Change Conference for talks on cutting carbon emissions.
However, 13,000 tonnes of carbon dioxide will be produced by the conference. This is enough to fill 150 London buses or the new Wembley Stadium six times over, according to carbon offsetting group Climate Care.
The same amount of carbon is produced every year by 2,200 homes or by powering a low energy light bulb for a year in half a million UK households, the Energy Saving Trust has calculated.
The Polish Goverment has vowed to offset all the emissions once the two week conference is over by planting trees or investing in green technologies.
The UK sent 32 delegates from the Department of Energy and Climate Change. About a third flew part of the way and on by train and the remaining two thirds flew direct. The Government also plans to offset emissions.
But Sara Shaw of Tearfund, a charity that campaigned to get more people to travel to the conference by train, said Governments could do more to set an example.
She said: "The reality is if you are convening people from all over the world they will have to fly but while talks are in Europe it would be great if Government delegations did their best to travel in the most carbon-friendly way.
"It shows integrity and sends a message that they are taking their own impact seriously."
By Louise Gray, Environment Correspondent Last Updated: 6:14PM GMT 10 Dec 2008
Representatives from 192 countries as well as environmental groups, aid agencies and industry groups have gathered in Poznan, Poland for the UN Climate Change Conference for talks on cutting carbon emissions.
However, 13,000 tonnes of carbon dioxide will be produced by the conference. This is enough to fill 150 London buses or the new Wembley Stadium six times over, according to carbon offsetting group Climate Care.
The same amount of carbon is produced every year by 2,200 homes or by powering a low energy light bulb for a year in half a million UK households, the Energy Saving Trust has calculated.
The Polish Goverment has vowed to offset all the emissions once the two week conference is over by planting trees or investing in green technologies.
The UK sent 32 delegates from the Department of Energy and Climate Change. About a third flew part of the way and on by train and the remaining two thirds flew direct. The Government also plans to offset emissions.
But Sara Shaw of Tearfund, a charity that campaigned to get more people to travel to the conference by train, said Governments could do more to set an example.
She said: "The reality is if you are convening people from all over the world they will have to fly but while talks are in Europe it would be great if Government delegations did their best to travel in the most carbon-friendly way.
"It shows integrity and sends a message that they are taking their own impact seriously."
Funds from sale of emission permits should be invested in green technology, say Lords
Peers say funds raised through emissions trading scheme should be spent on 'climate change-related measures'
Allegra Stratton
guardian.co.uk, Wednesday December 10 2008 08.54 GMT
A cross-party group of Lords has called on the government to reinvest the millions raised from the sale of carbon emission permits in green technology, following criticism that ministers are planning to add the funds to the Treasury's books.
In a bid by member states to reach the EU target of cutting carbon emissions by 20% by 2020, a portion of permits are already being auctioned within the emissions trading scheme (ETS), but plans to be decided in Poznan tomorrow could see 100% of permits auctioned.
The scheme puts a cap on emissions from about 12,000 factories and power plants across the EU responsible for about half of the region's emissions. Companies receive a quota of allowances that they can then trade, thereby creating a price for polluting.
If the plans go ahead, the environmental consultancy WSP predicts the UK government could possibly raise as much as £1bn from 85m permits in 2012 and £2.5bn in 2013.
Next year alone the British government plans to auction 25 million permits – a process that would raise nearly £350m.
Environmental groups fear a Treasury decision to keep the proceeds rather than ring-fence them for use in environmental projects plays into the hands of those who regard the ETS to be a stealth tax. Instead they point to Netherlands and Germany, which have pledged to spend the cash on measures such as improved energy efficiency and alternative energy.
In their report the Lords - who support a move towards 100% auctioning by 2013 - say the funds raised through the ETS should be ploughed back into "climate change-related measures" to "maintain the credibility of the scheme".
When EU leaders meet tomorrow in Poznan, member states such as Poland and other poorer ex-communist EU member states worried that the plans to cut carbon emissions by 20% from 1990 levels by 2020 will damage their economies would like an exemption.
They are supported by the German chancellor, Angela Merkel, who yesterday argued that industries facing higher costs and tougher international competition should be 80-100 % exempt from buying emission permits from the ETS.
Yesterday the Lords said the moves by some European countries to "postpone" the increase in auctioning until industry might be in a better position to absorb the costs, should be "resisted".
Referring to revenue raised by the current auctioning, the committee said the funds raised through the ETS should be ploughed back into "climate change-related measures" to "maintain the credibility of the scheme".
At the moment firms receive some of their permits for free but at the end of November the government carried out its first auction of carbon emission permits from the operator of Europe's largest coal-fired power station, Drax, and raised over £50m.
The Lords' report said: "It is our firm view that member states should invest considerable funds in climate change-related measures – including R&D and demonstration projects, as well as adaptation measures – and in measures to ease the social problems that may arise as a result of the ETS, such as increases in electricity prices. In our view this will be essential to maintaining the credibility of the scheme, by signalling that governments are willing to foot part of the bill that they are imposing on the private sector."
The Polish prime minister, Donald Tusk, is opposed to European commission plans to make power stations buy permits to pollute by 2013. Tusk has in the past threateneda Polish veto – fearing it would ramp up costs for its power sector, which is about 95% reliant on highly polluting coal.
Western European governments point to 10% of revenues earmarked for a 7.5b euro "solidarity fund" to compensate Poland the other ex-communist states for the heavy cost of overhauling their power stations.
Allegra Stratton
guardian.co.uk, Wednesday December 10 2008 08.54 GMT
A cross-party group of Lords has called on the government to reinvest the millions raised from the sale of carbon emission permits in green technology, following criticism that ministers are planning to add the funds to the Treasury's books.
In a bid by member states to reach the EU target of cutting carbon emissions by 20% by 2020, a portion of permits are already being auctioned within the emissions trading scheme (ETS), but plans to be decided in Poznan tomorrow could see 100% of permits auctioned.
The scheme puts a cap on emissions from about 12,000 factories and power plants across the EU responsible for about half of the region's emissions. Companies receive a quota of allowances that they can then trade, thereby creating a price for polluting.
If the plans go ahead, the environmental consultancy WSP predicts the UK government could possibly raise as much as £1bn from 85m permits in 2012 and £2.5bn in 2013.
Next year alone the British government plans to auction 25 million permits – a process that would raise nearly £350m.
Environmental groups fear a Treasury decision to keep the proceeds rather than ring-fence them for use in environmental projects plays into the hands of those who regard the ETS to be a stealth tax. Instead they point to Netherlands and Germany, which have pledged to spend the cash on measures such as improved energy efficiency and alternative energy.
In their report the Lords - who support a move towards 100% auctioning by 2013 - say the funds raised through the ETS should be ploughed back into "climate change-related measures" to "maintain the credibility of the scheme".
When EU leaders meet tomorrow in Poznan, member states such as Poland and other poorer ex-communist EU member states worried that the plans to cut carbon emissions by 20% from 1990 levels by 2020 will damage their economies would like an exemption.
They are supported by the German chancellor, Angela Merkel, who yesterday argued that industries facing higher costs and tougher international competition should be 80-100 % exempt from buying emission permits from the ETS.
Yesterday the Lords said the moves by some European countries to "postpone" the increase in auctioning until industry might be in a better position to absorb the costs, should be "resisted".
Referring to revenue raised by the current auctioning, the committee said the funds raised through the ETS should be ploughed back into "climate change-related measures" to "maintain the credibility of the scheme".
At the moment firms receive some of their permits for free but at the end of November the government carried out its first auction of carbon emission permits from the operator of Europe's largest coal-fired power station, Drax, and raised over £50m.
The Lords' report said: "It is our firm view that member states should invest considerable funds in climate change-related measures – including R&D and demonstration projects, as well as adaptation measures – and in measures to ease the social problems that may arise as a result of the ETS, such as increases in electricity prices. In our view this will be essential to maintaining the credibility of the scheme, by signalling that governments are willing to foot part of the bill that they are imposing on the private sector."
The Polish prime minister, Donald Tusk, is opposed to European commission plans to make power stations buy permits to pollute by 2013. Tusk has in the past threateneda Polish veto – fearing it would ramp up costs for its power sector, which is about 95% reliant on highly polluting coal.
Western European governments point to 10% of revenues earmarked for a 7.5b euro "solidarity fund" to compensate Poland the other ex-communist states for the heavy cost of overhauling their power stations.
Making the EU a greener place by law
Four new laws, or EU directives, are aimed at making the EU the world's first low-carbon economy
Ian Traynor in Brussels
guardian.co.uk, Wednesday December 10 2008 16.44 GMT
Emissions trading scheme (ETS)
The cap and trade scheme limits industrial emissions and forces companies to pay to pollute by buying permits for each tonne of carbon dioxide and other greenhouse gases. The permits are to be traded in an auction system. The new law revises the ETS which has been operating in embryo since 2005. This scheme is supposed to supply around half the greenhouse gas cuts. The draft exempts some sectors from paying on competition grounds. But Germany wants to vastly expand the exemptions and Poland wants its power stations' permits for free.
Effort-sharing
This law covers the other half of pollution total from sources not subject to the ETS, such as emissions from farming, the building sector, and transport. While the ETS is to be run on a Europe-wide basis, the effort-sharing targets are prescribed nationally. There are already agreements on new car emissions and road fuel, cutting CO2 emissions from most new cars by 19% over a three-year period from 2012 and stipulating that 10% of transport fuel is non-fossil.
Renewables
Agreement reached on Tuesday that 20% of Europe's energy mix comes from renewable sources, such as windfarms and hydro-power, by 2020. Progressive national targets and quotas have been set, with Britain needing 15% from renewables by the deadline.
Carbon Capture and Storage
A new law envisages the establishment of 12 "demonstration" CCS projects to sequestrate and bury CO2 from power plants. Expensive and futuristic, the scheme is to be off the ground by 2015, but is the subject of dispute over which countries get the pilot projects and how they are funded.
Ian Traynor in Brussels
guardian.co.uk, Wednesday December 10 2008 16.44 GMT
Emissions trading scheme (ETS)
The cap and trade scheme limits industrial emissions and forces companies to pay to pollute by buying permits for each tonne of carbon dioxide and other greenhouse gases. The permits are to be traded in an auction system. The new law revises the ETS which has been operating in embryo since 2005. This scheme is supposed to supply around half the greenhouse gas cuts. The draft exempts some sectors from paying on competition grounds. But Germany wants to vastly expand the exemptions and Poland wants its power stations' permits for free.
Effort-sharing
This law covers the other half of pollution total from sources not subject to the ETS, such as emissions from farming, the building sector, and transport. While the ETS is to be run on a Europe-wide basis, the effort-sharing targets are prescribed nationally. There are already agreements on new car emissions and road fuel, cutting CO2 emissions from most new cars by 19% over a three-year period from 2012 and stipulating that 10% of transport fuel is non-fossil.
Renewables
Agreement reached on Tuesday that 20% of Europe's energy mix comes from renewable sources, such as windfarms and hydro-power, by 2020. Progressive national targets and quotas have been set, with Britain needing 15% from renewables by the deadline.
Carbon Capture and Storage
A new law envisages the establishment of 12 "demonstration" CCS projects to sequestrate and bury CO2 from power plants. Expensive and futuristic, the scheme is to be off the ground by 2015, but is the subject of dispute over which countries get the pilot projects and how they are funded.
Europe pledges strict emissions cut to tempt China and India into climate deal
European climate chiefs to pledge 85-90% emissions cut by 2050 in exchange for 15-30% reduction by developing countries
David Adam
guardian.co.uk, Wednesday December 10 2008 11.16 GMT
European officials have offered to make the continent virtually zero-carbon in an attempt to lure China and other developing countries into a new global climate deal to replace the Kyoto protocol.
Stavros Dimas, European commissioner for the environment, told the Guardian that the EU could aim for a 80-95% reduction in greenhouse gas pollution by 2050 in exchange for greater efforts by developing nations to limit their emissions.
Dimas said the pledge has "already been put on the table" and that he was awaiting responses. In return, Europe would ask developing countries to reduce their forecasted carbon pollution growth by 15-30% over the next decade. "We haven't got any reaction, so they're floating somewhere," he said.
His comments came as ministers are due to arrive at UN climate talks in Poznan, Poland, which aim to set the stage for countries to agree a new global deal on global warming to succeed the Kyoto protocol.
They also come as European officials fight to agree a series of measures to cut carbon emissions across the continent 20-30% by 2020. Poland and Italy have complained about the cost of the package, which must be agreed by Gordon Brown and other European leaders in Brussels on Friday.
Dimas said "lots of concerns" had been expressed by member states, but that he was confident the targets would be approved. A failure or significant watering down of the proposals would weaken Europe's bargaining power in the negotiations over a new global deal, which officials aim to agree at a meeting in Copenhagen this time next year. "It is only logical to expect discussions, but we will find a solution," said Dimas.
He said the suggested European 80-95% cut for 2050 would be calculated on 1990 levels, and would include all sectors of the European economy, including the aviation and shipping industries. It is intended to maintain the EU position of limiting global temperature rise to 2°C.
"We follow up what the scientists tell us and we select [our target] accordingly, to not put our world at risk of irreversible damage," he said. "This is the reason we are changing the long-term target."
Dimas said the 80-95% cut was "still being discussed with the scientists" and would be published in a position paper next month. "I don't want to scare, not only the developing countries but also the developed. We should do it in a smooth way." The pledge would force the UK government to reassess its new Climate Change Act, which aims for 80% carbon cuts by 2050.
Rajendra Pachauri, chair of the Intergovernmental Panel on Climate Change and director of the Energy and Resources Institute in Delhi, said the 2050 European pledge was unlikely to impress developing countries, who wanted more action from all rich countries in the short-term. He said: "Unless the developed world comes up with strong, clear targets for 2020 themselves, I think it is unlikely the developing world will commit itself to reductions."
He said rich countries including the US needed to agree targets of 25-40% by 2020. "I think the most important development that could take place is for the US to make a major commitment. The extent to which the US is prepared to go is fundamental in creating the right atmosphere."
British officials are confident that President-elect, Barack Obama, will commit the US to such targets next year. They expect the negotiations on a Copenhagen deal to make little progress until then.
Henry Derwent, former UK chief climate negotiator and now head of the International Emissions Trading Association, said: "I cannot conceive of this problem being solved without a positive and well-intentioned US president, but he has domestic problems to resolve. I can't imagine that [Obama] as president will be driven by what the international community expects him to do."
David Adam
guardian.co.uk, Wednesday December 10 2008 11.16 GMT
European officials have offered to make the continent virtually zero-carbon in an attempt to lure China and other developing countries into a new global climate deal to replace the Kyoto protocol.
Stavros Dimas, European commissioner for the environment, told the Guardian that the EU could aim for a 80-95% reduction in greenhouse gas pollution by 2050 in exchange for greater efforts by developing nations to limit their emissions.
Dimas said the pledge has "already been put on the table" and that he was awaiting responses. In return, Europe would ask developing countries to reduce their forecasted carbon pollution growth by 15-30% over the next decade. "We haven't got any reaction, so they're floating somewhere," he said.
His comments came as ministers are due to arrive at UN climate talks in Poznan, Poland, which aim to set the stage for countries to agree a new global deal on global warming to succeed the Kyoto protocol.
They also come as European officials fight to agree a series of measures to cut carbon emissions across the continent 20-30% by 2020. Poland and Italy have complained about the cost of the package, which must be agreed by Gordon Brown and other European leaders in Brussels on Friday.
Dimas said "lots of concerns" had been expressed by member states, but that he was confident the targets would be approved. A failure or significant watering down of the proposals would weaken Europe's bargaining power in the negotiations over a new global deal, which officials aim to agree at a meeting in Copenhagen this time next year. "It is only logical to expect discussions, but we will find a solution," said Dimas.
He said the suggested European 80-95% cut for 2050 would be calculated on 1990 levels, and would include all sectors of the European economy, including the aviation and shipping industries. It is intended to maintain the EU position of limiting global temperature rise to 2°C.
"We follow up what the scientists tell us and we select [our target] accordingly, to not put our world at risk of irreversible damage," he said. "This is the reason we are changing the long-term target."
Dimas said the 80-95% cut was "still being discussed with the scientists" and would be published in a position paper next month. "I don't want to scare, not only the developing countries but also the developed. We should do it in a smooth way." The pledge would force the UK government to reassess its new Climate Change Act, which aims for 80% carbon cuts by 2050.
Rajendra Pachauri, chair of the Intergovernmental Panel on Climate Change and director of the Energy and Resources Institute in Delhi, said the 2050 European pledge was unlikely to impress developing countries, who wanted more action from all rich countries in the short-term. He said: "Unless the developed world comes up with strong, clear targets for 2020 themselves, I think it is unlikely the developing world will commit itself to reductions."
He said rich countries including the US needed to agree targets of 25-40% by 2020. "I think the most important development that could take place is for the US to make a major commitment. The extent to which the US is prepared to go is fundamental in creating the right atmosphere."
British officials are confident that President-elect, Barack Obama, will commit the US to such targets next year. They expect the negotiations on a Copenhagen deal to make little progress until then.
Henry Derwent, former UK chief climate negotiator and now head of the International Emissions Trading Association, said: "I cannot conceive of this problem being solved without a positive and well-intentioned US president, but he has domestic problems to resolve. I can't imagine that [Obama] as president will be driven by what the international community expects him to do."
European leaders clash over pledges on global warming
Germany, Italy and Poland pull in different directions at crunch summit on climate change
Ian Traynor, Brussels
guardian.co.uk, Wednesday December 10 2008 16.29 GMT
The EU summit must decide how the bloc will achieve its target of 20% emissions cuts by 2020. Photograph: PA/Haydn West
European leaders gather in Brussels on Thursday for a crunch summit, acutely divided over how to deliver on pledges to combat global warming almost two years after declaring they would show the rest of the world how to tackle climate change.
The EU is split between the poorer east and the wealthy west. Germany says that most of their industries need not pay to pollute, Italy says it cannot afford the ambitious scheme, and Britain says that the package on the table could result in huge windfall profits for companies.
"There is a very big chasm between the various parties," said a senior European diplomat.
Prime ministers and presidents appear to be getting cold feet over key decisions that need to be taken by the weekend to enact laws that will make the climate change package binding for 27 countries.
Failure is not an option, they say. But Polish veto threats, Italian resistance, and German insistence that it will not jeopardise jobs to help save the planet, suggest that the action plan will be diluted. The risk is the EU will draw withering criticism from climate campaigners and signal weakness and indecision to the US, China, India and other key players in the global warming fight.
"It's a question of credibility," said Jose Manuel Barroso, president of the European Commission who described the summit as the most important of his five-year term. "It would be a real mistake for Europe to give the signal that we are watering down our position."
A negative outcome to the talks would moreover cast a pall over the latest round of UN negotiations to secure a post-Kyoto treaty to limit global greenhouse gases.
But at talks in Poznan, Poland, yesterday, EU environment commissioner Stavros Dimas, said: "There are a few issues left but I cannot imagine that we're not going to get an agreement on Friday. We are going to deliver the targets."
The EU package represents the most ambitious legislative effort on climate change anywhere which includes four laws that mandate cuts in greenhouse gases by one-fifth by 2020 compared with 1990 levels, reduce energy consumption in Europe by one-fifth by the same deadline and stipulate that 20% of Europe's energy mix comes from renewable sources.
Germany's chancellor Angela Merkel engineered the deal as EU president in March last year. Since then the EU has been bragging about leading the world in the race to keep global temperatures from rising by more than 2C.
It falls to Nicolas Sarkozy, the French president, to end his dynamic six months in the EU hot seat with a deal that could see the entire package turned into law before Christmas.
Sarkozy is staring failure in the face. But he is widely viewed as a consummate fixer who may pull it off. The disputes are fundamentally about costs, a disagreement that has become magnified in the current economic climate. While everyone agrees the headline target of 20% cuts in greenhouse gases by 2020 is sacrosanct, the disputes are about how to get there.
The heart of the scheme is the "cap-and-trade" or emissions trading system which is to supply around half of the cuts in greenhouse gases. The ceiling for industrial pollution levels is progressively lowered and industries and companies pay to pollute by buying permits in an auction system.
The pay-to-pollute principle is supposed to kick in from 2013, but is hugely contentious. Germany, in particular, is demanding that 30 industrial sectors be given their permits free of charge. The sectors are responsible for 90% of emissions in the scheme. If the Germans win the argument, the incentives for going greener will be minimised and revenue from the scheme will collapse.
"The Germans have set out an extreme negotiating position," said another diplomat. "They want absolute protection for all of their industry."
The mighty industrial lobbies in Germany are complaining that their global competitiveness will be wrecked if they need to pay for the pollution permits and are threatening to move out of Europe.
Merkel this week said that the summit "must not take decisions that would endanger jobs or investments in Germany. I will see to that."
The dispute between "old" and "new" Europe is also deep, with many seeing it as the biggest obstacle to an agreement.
The poorer post-communist states of central Europe, led by Poland, feel they are getting a raw deal, that they cannot afford the package, that their economic development will be affected and that their costs of living will soar.
Poland, for example, generates more than 90% of its electricity from dirty coal. It wants its power stations exempted from buying the permits until 2019 as well as massive transfers of funds from west to east.
The subsidies are supposed to be funded from the proceeds of the permit auctions. But the pot of money will be small if Germany wins the free permits argument. Britain is leading opposition to this form of subsidy, arguing that transfers of money to central Europe should come from the EU budget.
Silvio Berlusconi, the unpredictable Italian prime minister, has also warned he could veto the package on the grounds that he was not in office when it was agreed in spring last year.
Since then, the financial meltdown and the threat of a deep economic recession have dampened enthusiasm among European leaders.
While Barroso and Gordon Brown emphasise the opportunities for investment and job creation through tackling climate change, the German and Italian leaders are spreading the gloomier message that fighting global warming will cost jobs and growth.
If a deal is struck, it will result from Sarkozy twisting arms in a series of face-to-face meetings with other leaders likely to run into the small hours of Saturday morning.
The deadline is daunting. If the laws are not enacted within a couple of months, the momentum will be lost because the current European parliament ends its term in the spring and a new European commission is due next October.
The Europeans will have forfeited the leadership role on global warming to the incoming Obama administration in Washington.
Ian Traynor, Brussels
guardian.co.uk, Wednesday December 10 2008 16.29 GMT
The EU summit must decide how the bloc will achieve its target of 20% emissions cuts by 2020. Photograph: PA/Haydn West
European leaders gather in Brussels on Thursday for a crunch summit, acutely divided over how to deliver on pledges to combat global warming almost two years after declaring they would show the rest of the world how to tackle climate change.
The EU is split between the poorer east and the wealthy west. Germany says that most of their industries need not pay to pollute, Italy says it cannot afford the ambitious scheme, and Britain says that the package on the table could result in huge windfall profits for companies.
"There is a very big chasm between the various parties," said a senior European diplomat.
Prime ministers and presidents appear to be getting cold feet over key decisions that need to be taken by the weekend to enact laws that will make the climate change package binding for 27 countries.
Failure is not an option, they say. But Polish veto threats, Italian resistance, and German insistence that it will not jeopardise jobs to help save the planet, suggest that the action plan will be diluted. The risk is the EU will draw withering criticism from climate campaigners and signal weakness and indecision to the US, China, India and other key players in the global warming fight.
"It's a question of credibility," said Jose Manuel Barroso, president of the European Commission who described the summit as the most important of his five-year term. "It would be a real mistake for Europe to give the signal that we are watering down our position."
A negative outcome to the talks would moreover cast a pall over the latest round of UN negotiations to secure a post-Kyoto treaty to limit global greenhouse gases.
But at talks in Poznan, Poland, yesterday, EU environment commissioner Stavros Dimas, said: "There are a few issues left but I cannot imagine that we're not going to get an agreement on Friday. We are going to deliver the targets."
The EU package represents the most ambitious legislative effort on climate change anywhere which includes four laws that mandate cuts in greenhouse gases by one-fifth by 2020 compared with 1990 levels, reduce energy consumption in Europe by one-fifth by the same deadline and stipulate that 20% of Europe's energy mix comes from renewable sources.
Germany's chancellor Angela Merkel engineered the deal as EU president in March last year. Since then the EU has been bragging about leading the world in the race to keep global temperatures from rising by more than 2C.
It falls to Nicolas Sarkozy, the French president, to end his dynamic six months in the EU hot seat with a deal that could see the entire package turned into law before Christmas.
Sarkozy is staring failure in the face. But he is widely viewed as a consummate fixer who may pull it off. The disputes are fundamentally about costs, a disagreement that has become magnified in the current economic climate. While everyone agrees the headline target of 20% cuts in greenhouse gases by 2020 is sacrosanct, the disputes are about how to get there.
The heart of the scheme is the "cap-and-trade" or emissions trading system which is to supply around half of the cuts in greenhouse gases. The ceiling for industrial pollution levels is progressively lowered and industries and companies pay to pollute by buying permits in an auction system.
The pay-to-pollute principle is supposed to kick in from 2013, but is hugely contentious. Germany, in particular, is demanding that 30 industrial sectors be given their permits free of charge. The sectors are responsible for 90% of emissions in the scheme. If the Germans win the argument, the incentives for going greener will be minimised and revenue from the scheme will collapse.
"The Germans have set out an extreme negotiating position," said another diplomat. "They want absolute protection for all of their industry."
The mighty industrial lobbies in Germany are complaining that their global competitiveness will be wrecked if they need to pay for the pollution permits and are threatening to move out of Europe.
Merkel this week said that the summit "must not take decisions that would endanger jobs or investments in Germany. I will see to that."
The dispute between "old" and "new" Europe is also deep, with many seeing it as the biggest obstacle to an agreement.
The poorer post-communist states of central Europe, led by Poland, feel they are getting a raw deal, that they cannot afford the package, that their economic development will be affected and that their costs of living will soar.
Poland, for example, generates more than 90% of its electricity from dirty coal. It wants its power stations exempted from buying the permits until 2019 as well as massive transfers of funds from west to east.
The subsidies are supposed to be funded from the proceeds of the permit auctions. But the pot of money will be small if Germany wins the free permits argument. Britain is leading opposition to this form of subsidy, arguing that transfers of money to central Europe should come from the EU budget.
Silvio Berlusconi, the unpredictable Italian prime minister, has also warned he could veto the package on the grounds that he was not in office when it was agreed in spring last year.
Since then, the financial meltdown and the threat of a deep economic recession have dampened enthusiasm among European leaders.
While Barroso and Gordon Brown emphasise the opportunities for investment and job creation through tackling climate change, the German and Italian leaders are spreading the gloomier message that fighting global warming will cost jobs and growth.
If a deal is struck, it will result from Sarkozy twisting arms in a series of face-to-face meetings with other leaders likely to run into the small hours of Saturday morning.
The deadline is daunting. If the laws are not enacted within a couple of months, the momentum will be lost because the current European parliament ends its term in the spring and a new European commission is due next October.
The Europeans will have forfeited the leadership role on global warming to the incoming Obama administration in Washington.
Merkel appears isolated on key EU policies
By Stephen Castle and James Kanter
Published: December 10, 2008
BRUSSELS: Germany's shift from reliable paymaster to a surprisingly recalcitrant partner has cast doubt on chances for success at a European Union summit opening Thursday, where expensive but contentious measures to combat recession and climate change top the agenda.
With the country that has long been at the heart of EU affairs increasingly defending its own corner, the European Commission president, José Manuel Barroso, found himself in the awkward position of having to make a formal denial that Berlin is now isolated within the EU.
"We need Germany and Germany needs Europe," he said Tuesday. Tellingly, the phrase is similar to language often used to implore skeptical countries, like Britain, to engage more with the EU.
At the two-day summit meeting, Chancellor Angela Merkel has made it clear that she will seek to shield Germany's heavy industry - and around 90 percent of EU industrial producers - from proposals to combat climate change, unless other countries outside Europe agree to similar moves. Berlin is also urging caution over a planned €200 billion, or $260 billion, stimulus package for the European economy.
Though for years the Germans bankrolled initiatives approved at EU summit meetings, this time they fear having to pick up the check for easing the burden of CO2 reduction measures on poorer, eastern, countries like Poland.
Though Merkel's leadership within the EU was widely praised only last year, she now seems happy to present herself as "Madame Non," as she's been dubbed by the French media.
Germany's more assertive stance, especially on climate change, derives from the structure of its economy which, Barroso pointed out, has a larger industrial sector than Britain and France combined.
But analysts said it also reflected evolving German attitudes to an EU that has enlarged over the decades from a tight unit of six nations, steered by Paris and Berlin, to a looser alliance of 27.
Charles Grant, director of the Center for European Reform in London, believes this has tested the affection of a new generation of politicians for the EU. "Both the Germans and the French," Grant said, "have discovered that, after its enlargement, the EU has really changed. If they don't run the EU, they won't support it in the same way, because they don't see it as the projection of their interests in the way they did."
Thomas Klau, senior analyst at the European Council on Foreign Relations, noted that Germany has resisted pressure from other member states in the past. What is new, however, "is Germany is giving the impression of not being in the vanguard of devising solutions after a major crisis, and not feeling responsibility for demonstrating that the EU can act as one."
At the Brussels summit meeting, Germany is particularly concerned about a French proposal that would offer countries like Poland free permits to produce carbon when generating electricity until late in the next decade. That proposal would award big benefits to Eastern European power producers, creating a competitive disadvantage for other coal-reliant power producers in Western Europe.
Tensions also are running high within Germany over the impact of the EU's climate plans. RWE, a German electricity utility that is the largest CO2 polluter in Europe, renewed protests this week against an EU proposal that would force power generators to buy 100 percent of their permits to generate electricity beginning in 2013.
Over dinner Tuesday night in Poznan, Poland, where global climate change discussions are under way, Johannes Lambertz, the chief executive of RWE Power, warned that Germany's future as an industrial power was at stake if Europe adopted the EU package without substantial modifications.
Speaking in the presence of the German environment minister, Sigmar Gabriel, Lambertz said its investments "must also offer us some return" if RWE was to spend more than €30 billion in power plants, mines and electricity grids.
That prompted a sharp response from Gabriel, according to his spokesman, Michael Schroeren.
Gabriel said the EU system needed urgent changes because RWE and other coal-burning utilities were making large windfall profits by passing through the cost of the permits they had received for free.
"RWE said of course it had made investments with that money," Schroeren said, referring to the windfall. "But the minister then told Mr. Lambertz, 'You got this money without doing anything with it."'
In a letter sent Wednesday to the International Herald Tribune, Jürgen Grossmann, the chief executive of RWE, wrote that "windfall profits were not pocketed, but rather translated in their entirety into investments in the order of €19 billion between 2005 and 2007."
Grossman wrote in response to an article published Tuesday in the International Herald Tribune about the size of windfall profits earned by utilities in Europe, and RWE in particular.
Bank analysts and environmental advocates estimate RWE has received a windfall of roughly €5 billion in the first three years of the system, concluding in 2007 - more than any other company in Europe.
Felix Matthes at the Institute for Applied Ecology, a German environmental research group, has estimated that RWE could benefit from a further €9.4 billion in windfall profits before 2013, when the system is supposed to be changed.
But Grant, the analyst, believes that other short-term factors have poisoned relations between Berlin and its partners including politics among coalition colleagues and rivals preparing for elections next year. Another issue, he says, is "the rudeness and arrogance of some German officials and political leaders when they deal with colleagues." One European diplomat this week described with distaste the blunt, uncompromising, manner in which the German finance minister Peer Steinbrück, contradicted the French economy minister, Christine Lagarde, at a recent meeting of finance ministers. The diplomat, who attended the session, spoke on condition of anonymity because of the sensitivity of the issue.
Though Merkel is famed for her polite, if steely, manner, her relations with the French president, Nicolas Sarkozy, are far from warm.
A scientist by training, with a mastery of detail, Merkel is instinctively at odds with her energetic and mercurial French counterpart. "The Germans," said another diplomat, also speaking on condition of anonymity due to the sensitivity of the subject, "hate the feeling that they wake up in the morning and have no idea what Sarkozy will do that day. They really hate it."
Klau put much of Germany's new-found obstinance down to the tensions within the ruling coalition.
"Germany has not become euroskeptic," Klau added, "but there is a growing and misplaced confidence in its ability to have a successful non-European foreign policy if the European policy available is one that Germany finds less palatable."
A German official, requesting anonymity to comply with government rules, argued that Berlin has put in place the biggest economic recovery package in Europe, worth €32 billion. But Germany makes few apologies for seeking to maintain fiscal discipline.
"Now we have already whisked our stimulus package through Parliament," the official said, "it is difficult to envisage Germany going on a spending spree beyond what we have already decided upon just in order to do 'something."'
Published: December 10, 2008
BRUSSELS: Germany's shift from reliable paymaster to a surprisingly recalcitrant partner has cast doubt on chances for success at a European Union summit opening Thursday, where expensive but contentious measures to combat recession and climate change top the agenda.
With the country that has long been at the heart of EU affairs increasingly defending its own corner, the European Commission president, José Manuel Barroso, found himself in the awkward position of having to make a formal denial that Berlin is now isolated within the EU.
"We need Germany and Germany needs Europe," he said Tuesday. Tellingly, the phrase is similar to language often used to implore skeptical countries, like Britain, to engage more with the EU.
At the two-day summit meeting, Chancellor Angela Merkel has made it clear that she will seek to shield Germany's heavy industry - and around 90 percent of EU industrial producers - from proposals to combat climate change, unless other countries outside Europe agree to similar moves. Berlin is also urging caution over a planned €200 billion, or $260 billion, stimulus package for the European economy.
Though for years the Germans bankrolled initiatives approved at EU summit meetings, this time they fear having to pick up the check for easing the burden of CO2 reduction measures on poorer, eastern, countries like Poland.
Though Merkel's leadership within the EU was widely praised only last year, she now seems happy to present herself as "Madame Non," as she's been dubbed by the French media.
Germany's more assertive stance, especially on climate change, derives from the structure of its economy which, Barroso pointed out, has a larger industrial sector than Britain and France combined.
But analysts said it also reflected evolving German attitudes to an EU that has enlarged over the decades from a tight unit of six nations, steered by Paris and Berlin, to a looser alliance of 27.
Charles Grant, director of the Center for European Reform in London, believes this has tested the affection of a new generation of politicians for the EU. "Both the Germans and the French," Grant said, "have discovered that, after its enlargement, the EU has really changed. If they don't run the EU, they won't support it in the same way, because they don't see it as the projection of their interests in the way they did."
Thomas Klau, senior analyst at the European Council on Foreign Relations, noted that Germany has resisted pressure from other member states in the past. What is new, however, "is Germany is giving the impression of not being in the vanguard of devising solutions after a major crisis, and not feeling responsibility for demonstrating that the EU can act as one."
At the Brussels summit meeting, Germany is particularly concerned about a French proposal that would offer countries like Poland free permits to produce carbon when generating electricity until late in the next decade. That proposal would award big benefits to Eastern European power producers, creating a competitive disadvantage for other coal-reliant power producers in Western Europe.
Tensions also are running high within Germany over the impact of the EU's climate plans. RWE, a German electricity utility that is the largest CO2 polluter in Europe, renewed protests this week against an EU proposal that would force power generators to buy 100 percent of their permits to generate electricity beginning in 2013.
Over dinner Tuesday night in Poznan, Poland, where global climate change discussions are under way, Johannes Lambertz, the chief executive of RWE Power, warned that Germany's future as an industrial power was at stake if Europe adopted the EU package without substantial modifications.
Speaking in the presence of the German environment minister, Sigmar Gabriel, Lambertz said its investments "must also offer us some return" if RWE was to spend more than €30 billion in power plants, mines and electricity grids.
That prompted a sharp response from Gabriel, according to his spokesman, Michael Schroeren.
Gabriel said the EU system needed urgent changes because RWE and other coal-burning utilities were making large windfall profits by passing through the cost of the permits they had received for free.
"RWE said of course it had made investments with that money," Schroeren said, referring to the windfall. "But the minister then told Mr. Lambertz, 'You got this money without doing anything with it."'
In a letter sent Wednesday to the International Herald Tribune, Jürgen Grossmann, the chief executive of RWE, wrote that "windfall profits were not pocketed, but rather translated in their entirety into investments in the order of €19 billion between 2005 and 2007."
Grossman wrote in response to an article published Tuesday in the International Herald Tribune about the size of windfall profits earned by utilities in Europe, and RWE in particular.
Bank analysts and environmental advocates estimate RWE has received a windfall of roughly €5 billion in the first three years of the system, concluding in 2007 - more than any other company in Europe.
Felix Matthes at the Institute for Applied Ecology, a German environmental research group, has estimated that RWE could benefit from a further €9.4 billion in windfall profits before 2013, when the system is supposed to be changed.
But Grant, the analyst, believes that other short-term factors have poisoned relations between Berlin and its partners including politics among coalition colleagues and rivals preparing for elections next year. Another issue, he says, is "the rudeness and arrogance of some German officials and political leaders when they deal with colleagues." One European diplomat this week described with distaste the blunt, uncompromising, manner in which the German finance minister Peer Steinbrück, contradicted the French economy minister, Christine Lagarde, at a recent meeting of finance ministers. The diplomat, who attended the session, spoke on condition of anonymity because of the sensitivity of the issue.
Though Merkel is famed for her polite, if steely, manner, her relations with the French president, Nicolas Sarkozy, are far from warm.
A scientist by training, with a mastery of detail, Merkel is instinctively at odds with her energetic and mercurial French counterpart. "The Germans," said another diplomat, also speaking on condition of anonymity due to the sensitivity of the subject, "hate the feeling that they wake up in the morning and have no idea what Sarkozy will do that day. They really hate it."
Klau put much of Germany's new-found obstinance down to the tensions within the ruling coalition.
"Germany has not become euroskeptic," Klau added, "but there is a growing and misplaced confidence in its ability to have a successful non-European foreign policy if the European policy available is one that Germany finds less palatable."
A German official, requesting anonymity to comply with government rules, argued that Berlin has put in place the biggest economic recovery package in Europe, worth €32 billion. But Germany makes few apologies for seeking to maintain fiscal discipline.
"Now we have already whisked our stimulus package through Parliament," the official said, "it is difficult to envisage Germany going on a spending spree beyond what we have already decided upon just in order to do 'something."'
Angela Merkel turns her back on green dream of EU
The Times
December 11, 2008
David Charter in Brussels
Angela Merkel was once the Green Goddess who pushed through tough climate change targets to show that Europe could lead the world in beating global warming.
Under huge pressure to shield German industry from the cost of going green, however, she has been transformed into Frau Nein — fighting to reverse key goals that she once championed.
As EU leaders meet to complete the targets today the German Chancellor, who was so firmly in Europe's driving seat just a year ago, also seems off-message over the other main item on the agenda: the size of the recovery plan needed to beat the recession.
Berlin is being accused of resorting to national self-interest just when Europe needs to pull together. Moreover, the importance of Europe sticking to its ambitious target of cutting CO2 by 20 per cent by 2020 has never been greater, with the chance of liaising with a sympathetic new US president to push for a global successor to the Kyoto Protocol fast approaching.
“On a broad range of issues the Germans seem to think the European Union no longer advances their interests and are more prone to go their own way,” said Charles Grant, director of the Centre for European Reform.
“In Brussels, Paris, Washington and other capitals, one increasingly hears the same complaint: Germany is acting unilaterally.”
A fierce battle has been raging behind the scenes in Europe's capitals ever since Mrs Merkel proudly announced the so-called 20/20/20 targets, under the German presidency of the EU in March last year.
The goals would be for a 20 per cent cut in emissions by 2020 compared to 1990 levels, combined with 20 per cent of fuel to come from renewable sources and a 20 per cent improvement in energy efficiency.
The targets themselves have survived — just — but the hard part has been putting them into practice by making sure that each country does its share.
One of the key mechanisms is the EU's emissions trading scheme, which, from 2013, will force companies to buy carbon credits — each worth one metric tonne of CO2 — which they can trade if they cut pollution.
Since the scheme was drawn up, however, the recession has given extra weight to arguments that the rump of European industry will be forced out of business by the extra costs.
German industry, in particular, has complained that it faces “carbon leakage” — the relocation of steel, aluminium and cement production to countries much less scrupulous about pollution and free from targets and emissions trading.
Mrs Merkel arrives in Brussels today demanding free carbon credits for 90 to 100 per cent of German factories until 2020 - blowing a hole in a key climate change scheme.
Where Germany leads, others follow. Mrs Merkel's demands have strengthened calls from a group of nine former Iron Curtain countries, led by Poland, for free credits and for massive cash subsidies from Western Europe to fund green technology.
The European Commission has proposed a “solidarity fund” for the coal-dependent countries worth 7.5 billion euros (£6.5 billion) in sales of carbon credits. They want twice as much; Britain opposes the principle of the subsidy.
President Sarkozy, who holds the EU's rotating leadership until the end of the month, is determined to resolve the climate clash over the two-day EU gathering, not least to send a positive signal to UN climate change talks held at the same time in Poznan, Poland.
His relations with Mrs Merkel have been difficult and he has not been helped by a piece of clumsy diplomacy which took him to London on Monday to meet Gordon Brown and José Manuel Barroso, President of the European Commission, in what looked to some Germans like a conspiracy.
Frank-Walter Steinmeier, the German Foreign Minister and also Mrs Merkel's rival for the Chancellorship in next year's elections, took the opportunity to make a barbed comment. “I do not think it is good that the three are meeting alone and that the Chancellor is not there,” he said.
It showed that open sparring has already started before next summer's election, which will serve to make Mrs Merkel more likely to put domestic self-interest first at the EU summit.
Jan Kowalzig, a climate change campaigner with Oxfam in Germany, said: “Angela Merkel was the first Environment Minister that Germany ever had. We were surprised at how progressive she was at first but she has now come back more to her conservative party position. In the context of the elections next year, she is giving the impression that German jobs are more important than climate change.”
Mr Sarkozy faces a tough job to forge a compromise that will not be seen as the abandonment of the green dream. He has one trick up his sleeve to save the summit from failing by tomorrow night: he has let it be known that he is prepared to convene another heads-of-government meeting between Christmas and the New Year to finish the job.
And nobody wants to interrupt their holidays to stay up all night arguing over the emissions trading scheme.
December 11, 2008
David Charter in Brussels
Angela Merkel was once the Green Goddess who pushed through tough climate change targets to show that Europe could lead the world in beating global warming.
Under huge pressure to shield German industry from the cost of going green, however, she has been transformed into Frau Nein — fighting to reverse key goals that she once championed.
As EU leaders meet to complete the targets today the German Chancellor, who was so firmly in Europe's driving seat just a year ago, also seems off-message over the other main item on the agenda: the size of the recovery plan needed to beat the recession.
Berlin is being accused of resorting to national self-interest just when Europe needs to pull together. Moreover, the importance of Europe sticking to its ambitious target of cutting CO2 by 20 per cent by 2020 has never been greater, with the chance of liaising with a sympathetic new US president to push for a global successor to the Kyoto Protocol fast approaching.
“On a broad range of issues the Germans seem to think the European Union no longer advances their interests and are more prone to go their own way,” said Charles Grant, director of the Centre for European Reform.
“In Brussels, Paris, Washington and other capitals, one increasingly hears the same complaint: Germany is acting unilaterally.”
A fierce battle has been raging behind the scenes in Europe's capitals ever since Mrs Merkel proudly announced the so-called 20/20/20 targets, under the German presidency of the EU in March last year.
The goals would be for a 20 per cent cut in emissions by 2020 compared to 1990 levels, combined with 20 per cent of fuel to come from renewable sources and a 20 per cent improvement in energy efficiency.
The targets themselves have survived — just — but the hard part has been putting them into practice by making sure that each country does its share.
One of the key mechanisms is the EU's emissions trading scheme, which, from 2013, will force companies to buy carbon credits — each worth one metric tonne of CO2 — which they can trade if they cut pollution.
Since the scheme was drawn up, however, the recession has given extra weight to arguments that the rump of European industry will be forced out of business by the extra costs.
German industry, in particular, has complained that it faces “carbon leakage” — the relocation of steel, aluminium and cement production to countries much less scrupulous about pollution and free from targets and emissions trading.
Mrs Merkel arrives in Brussels today demanding free carbon credits for 90 to 100 per cent of German factories until 2020 - blowing a hole in a key climate change scheme.
Where Germany leads, others follow. Mrs Merkel's demands have strengthened calls from a group of nine former Iron Curtain countries, led by Poland, for free credits and for massive cash subsidies from Western Europe to fund green technology.
The European Commission has proposed a “solidarity fund” for the coal-dependent countries worth 7.5 billion euros (£6.5 billion) in sales of carbon credits. They want twice as much; Britain opposes the principle of the subsidy.
President Sarkozy, who holds the EU's rotating leadership until the end of the month, is determined to resolve the climate clash over the two-day EU gathering, not least to send a positive signal to UN climate change talks held at the same time in Poznan, Poland.
His relations with Mrs Merkel have been difficult and he has not been helped by a piece of clumsy diplomacy which took him to London on Monday to meet Gordon Brown and José Manuel Barroso, President of the European Commission, in what looked to some Germans like a conspiracy.
Frank-Walter Steinmeier, the German Foreign Minister and also Mrs Merkel's rival for the Chancellorship in next year's elections, took the opportunity to make a barbed comment. “I do not think it is good that the three are meeting alone and that the Chancellor is not there,” he said.
It showed that open sparring has already started before next summer's election, which will serve to make Mrs Merkel more likely to put domestic self-interest first at the EU summit.
Jan Kowalzig, a climate change campaigner with Oxfam in Germany, said: “Angela Merkel was the first Environment Minister that Germany ever had. We were surprised at how progressive she was at first but she has now come back more to her conservative party position. In the context of the elections next year, she is giving the impression that German jobs are more important than climate change.”
Mr Sarkozy faces a tough job to forge a compromise that will not be seen as the abandonment of the green dream. He has one trick up his sleeve to save the summit from failing by tomorrow night: he has let it be known that he is prepared to convene another heads-of-government meeting between Christmas and the New Year to finish the job.
And nobody wants to interrupt their holidays to stay up all night arguing over the emissions trading scheme.
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