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EU announces new climate change targets

European President, Jose Manuel Barroso, has revealed ambitious targets to reduce EU greenhouse emissions by 20% and produce 20% of energy from renewable sources by 2020.

"Today's package adds up to a detailed roadmap to bring about the political vision agreed last year," he told the European Parliament this morning.

The EU targets could leap to 30% with international agreement, he said.

The EU package includes the following features:

- An borderless Emissions Trading System, to drive cuts in greenhouse gas emissions from big industrial emitters.

- Binding national targets, so member States, "know exactly what they have to do outside the ETS, in sectors like transport, buildings, agriculture and waste," he said.

- Actively promote renewable targets, again including binding national targets.

- Introduce new rules to stimulate carbon capture and storage.

- Bring in new state aid rules.

"Part of our mandate was the 10% target for biofuels, so that transport plays a part in emissions cuts. I want to be clear that in putting forward proposals on biofuels, we have also fully respected the other side of the mandate, the need for environmental sustainability."

The Environmental Audit Commission said that biofuels, while reducing overall greenhouse emissions, could damage the environment, on Monday.

"So the proposal creates the most comprehensive and sustainable system anywhere in the world for the certification of biofuels – and for domestic and imported biofuels alike. We will also continue to promote the rapid development of second generation biofuels," said Barroso.

One driver for these new targets was the desire to, "halve global emissions by 2050. This means working today to bring tomorrow's technology rapidly on stream."

Barroso said that the new targets have been driven by the Stern report, commissioned by the Treasury last year to examine the economic effects of climate change. "The additional effort needed to realise the proposals would be to less than 0.5% of GDP by 2020. This amounts to about €3 a week for everyone. A real commitment, but not a bad deal. Even on the most optimistic assumptions of the Stern Report, the cost of inaction is more than ten times that.

"And every day the price of oil and gas goes up, the real cost of the package falls. Instead of costs, we really should be talking about gains for the EU," he said.

Barroso said that certain industries would be protected, so they would not lose competitive advantage. "So energy intensive industries would have ETS allowances free of charge. And if our expectations about an international agreement are not met, we will look at other options such as requiring importers to obtain allowances alongside European competitors, as long as such a system is compatible with WTO requirements."

Fairness is also important at the level of the citizen. We are encouraging Member States to act in a sensitive way, such as using a share of the billions of euros to be gained in auctioning revenues to help the less-well-off to invest in energy efficient homes.

He also said that climate change was could be an opportunity. "But we must not forget the huge economic opportunity represented by Europe's transition into a low-emissions economy.

"There are real opportunities there: the renewables sector alone will bring one million jobs by 2020. I am sure that once again, European industry will show its ability to innovate and adapt. Europe can be the first economy for the low-carbon age: we must seize this chance."

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