Climate and energy package

The European Commission announced a comprehensive package of proposals on energy and tackling climate change, aiming to lead the world in legislative measures preventing global warming.By 2020, Europe must cut greenhouse gas emissions by 20%, produce 20% of its energy from renewable sources and increase energy efficiency by 20%, according to the proposals – or "20/20/20 by 2020," as commission President Jose Manuel Barroso called the targets.

In an address to the European Parliament introducing the various initiatives, President Barroso called the package "the most far-reaching set of legislative proposals to be made by the European Commission for many years...[Europe] will show how a modern economy can be designed to meet the challenge. This is sustainable development in action," he said.

"The proposals ensure we are a world leader of the low-carbon economy," said competition commissioner Neelie Kroes at a press conference unveiling the various elements of the package alongside President Barroso and energy and environment commissioners Andris Piebalgs and Stavros Dimas.

At the heart of its new measures, the commission is to tighten up the existing emissions trading scheme (ETS) by having carbon allowances set at the EU level, rather than at the member state level. Furthermore, over the period 2012 to 2020, the ETS will extend the number of industrial sectors it covers.

For those economic sectors not covered by the ETS such as agriculture, waste, buildings and transport, member states will receive binding national emissions targets, with richer countries receiving stricter targets than poorer ones.

Twelve of the less economically developed member states, including almost all of the countries that joined since 2004, will actually be permitted to increase their greenhouse gas emissions.

An increase in the use of renewable energy also figures prominently in the package, with the commission requiring 20% use of energy from renewable sources such as wind power, solar power and geothermal heat. Each member state has been assigned a specific target for the percentage of renewables in the energy mix. Countries that already have a well-established renewable energy sector will be assigned targets that are tougher still.

Additionally, the commission has set a target of 10% use of biofuels in transport, despite the objections of environmental groups and development NGOs, who worry that biofuels actually increase greenhouse gas emissions and undermine food security in the developing world.

The commission also says that saving 20% of energy consumption through energy efficiency is "a crucial part of the puzzle".

Of particular importance to cutting emissions, according to the commission, is the role of carbon capture and storage (CCS), a controversial new technology that "captures" carbon from power plants and stores it in underground geological formations or deep oceans instead of releasing it into the atmosphere.

New guidelines on state aid will provide a framework for countries to support environmental protection – in particular in the field of energy, but also for support for the development of CCS technology.

Environmental campaigners say the measures do not go far enough. By contrast, some representatives of industry say the measures go too far and will hurt European competitiveness.

The package must still be approved by the European Parliament and member states, meaning implementation of the proposals is unlikely to be achieved before 2009.