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Forging ahead on energy and climate targets

By David Baldock, director, Institute for European Environmental Policy
If European environmental policy still lies in the shadow of the Lisbon Agenda, climate policy is on a roll. Perhaps most impressively it has inspired agreement on mandatory targets for both emissions reductions and the share of renewables in Europe’s overall energy consumption. The development of legal measures to move forward on the 2020 targets agreed in March will loom large in the European commission’s work plan over the coming year.
One of the first challenges will be to propose a reasonable subdivision of both emission reduction and renewable energy targets between member states, following the “burden sharing” principle established in 1998 for meeting the EU’s Kyoto commitments. Allocating targets to individual countries will crystalise summit aspirations into specific obligations requiring urgent and sustained action. It will bring into focus the gap between collective vision and the national foot-dragging that has been apparent in many policy areas. The commission will need to present a well-argued rationale for contentious proposals.
We can expect a clearer analysis of where the potential for emissions reductions and investment in renewables is greatest. The process should also generate a helpful debate about the scope for action in the least energy-efficient economies.
Given the rather weak legal basis in the EU treaty for launching mandatory legislation, a negotiated consensus is required to bring potentially reluctant governments on board. This will mean confronting some difficult issues.
One is the fairly slow pace of action in agreeing mandatory product standards, which is one of the most effective ways the EU can improve energy efficiency. Last year’s green paper on energy efficiency contained over 70 useful measures, including ecolabelling and new energy standards – but it lacks impetus.
Economic incentives are clearly required as well, not least fiscal measures. Member states such as the UK that resist common EU tax measures will need to present a convincing case for coordinating action in some other fashion.
More fundamentally, countries in southern and central Europe that have emphasised growth over climate considerations will need to be persuaded that the deal offers something for them. On this count, it is fortuitous that a debate on the EU budget is due to be launched this year and brought to head in 2009.
There is an opportunity to consider how the budget could contribute more to the climate agenda – for example, by accelerating investment in countries where the scope is large but the political commitment more tentative. Improving energy efficiency in public housing in the poorer new member states is one of many opportunities. A new direction in the budget would be an invaluable complement to legislation in triggering the kind of investment needed to meet a set of sobering targets.
However long the lull while new proposals are prepared, the climate agenda has further to travel into the heart of EU affairs.

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