"GLOBAL LEADERSHIP MEANS DOMESTIC ACTION" Climate…

               "GLOBAL LEADERSHIP MEANS DOMESTIC ACTION"

Climate Action Network Europe and its member groups welcome the European Commission's pro-
posals on the 2020 effort sharing of greenhouse gas emission reductions and the review of the EU
Emissions Trading directive. The proposals are a bold move forward in the implementation and im-
provement of European climate change policies. However, they are only a limited and inconsistent
first step in implementing the decisions of the March 2007 Council on 2020 greenhouse gas emis-
sion reduction objectives. The European Union has a leadership role at the international climate
change negotiations. To retain credibility, this international leadership has to be mirrored by strong
domestic action. This is crucial to secure a robust and equitable global post 2012 agreement.
NGO's call on the EU Environment Council, the EU Energy Council and the European Parliament
to strengthen and align the proposals so that they are in line with Europe's stance at the interna-
tional stage.

The effort sharing proposal and the review of the EU Emissions Trading Scheme (EU ETS)
have an ambition level which is clearly insufficient to achieve the reductions demanded by
evidence presented by the IPCC and to keep the rise of global average temperatures below
2°C. The proposals, starting with a 20% reduction effort compared to 1990, are therefore inconsis-
tent with the United Nations Framework Convention on Climate Change (UNFCCC) ultimate objec-
tive of preventing dangerous Climate Change. It is also contrary to the EU's position at COP13 in
Bali where all EU Member States called for reductions of emissions of 25 - 40% by 2020 for indus-
trialised countries.

On top of the unambitious and inconsistent reduction targets, these proposals offer Member States
and EU ETS installations the opportunity to off-set their emissions by using large quantities of ex-
ternal credits (such as those from the Clean Development Mechanism (CDM)). These loopholes
are a major concern for NGOs because they will further limit domestic EU reduction efforts and
move the EU even further away from the required emission trajectory to stay well below a 2°C
warming.

Therefore Climate Action Network Europe calls for a 30% domestic EU reduction target by
2020 compared to 1990 levels. On top of this the EU must show a clear ambition to support
developing countries in addressing their greenhouse gas emissions and in achieving sus-
tainable development. European NGOs propose the introduction of binding, measurable,
and verifiable efforts, by EU Member States and EU ETS installations in contributing to GHG
mitigation in these countries. To quantify these efforts, we refer to a report by the UNFCCC1
secretariat, which states that by 2030 a financial investment of around 69 billion EUR is re-
quired for mitigation in developing countries. With the EU 27 responsible for 30% of green-
house gas emissions from industrialised countries in 1990, this implies that the EU should
invest around 21 billion EUR. 2

The European Commission has missed the opportunity to show EU leadership in setting quality
criteria for external credits that can enter the EU as from 2013. This goes against the overwhelm-
ing evidence that many CDM projects are not delivering real emission reductions and in several
cases are not contributing towards sustainable development.

1 Investment and financial flows to address Climate Change", UNFCCC, 2007
2 With an allowance price of around 25 EUR per tonne of CO2 this amount is comparable to about half of the EU 30%
domestic emission reductions compared to 1990 levels.
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We strongly stress that the use of external credits should fulfil strict environmental, social
and additionality criteria. These standards should as a minimum be equivalent to the "CDM
Gold Standard" developed and supported by NGOs3.

The limited enforcement and compliance provisions in the effort sharing proposal impose a further
risk to the achievement of the reduction targets. To keep EU Member States on track to meet their
2020 reduction targets, enforcement and compliance measures of equivalent strength as those
under the EU ETS have to be introduced in the effort sharing proposal. The effort sharing pro-
posal should be given the strongest enforcement tools available to make sure that Member
States reduce their emissions in a linear annual manner, as foreseen in the effort sharing
proposal.

Climate Action Network Europe applauds the streamlining of the EU ETS. By setting the cap at EU
level from 2013 onwards, the EU clearly demonstrates that some lessons from the past have been
learnt. The higher level of auctioning in the EU ETS review proposal moves it towards an instru-
ment that introduces a clear price on carbon through the whole production chain. However, exclud-
ing some sectors from full auctioning will harm the environmental effectiveness of the EU ETS.
Without a clear price on carbon we will miss the development and introduction of stepping stone
technologies that can take us to the necessary reduction target of at least 80% by 2050. Postpon-
ing the introduction of 100% auctioning will therefore only increase the reduction costs in
the longer term, due to the absence of R&D and market introduction of EU developed miti-
gation technologies.

According to the latest IPCC report anthropogenic climate change is already creating significant
costs for developing countries. These are environmental, economic and human costs caused by
the historical emissions of industrialised countries such as the EU Member States. Using the equity
and polluter pays principles; this implies that EU Member States have to compensate for the dam-
age already caused in developing countries by climate change. Climate Action Network Europe
strongly requests that at least 50% of the revenues from EU allowance auctioning is in-
vested to assist developing countries in adapting to the effects of climate change4 while at
the same time further assisting in their efforts to mitigate future climate change through the
development and transfer of technology, capacity building and support for sustainable poli-
cies and measures. The remaining 50% of the auctioning revenues should be used in the
EU for supporting the development and market introduction of environmentally sound
greenhouse gas reduction instruments and technologies.

With the rest of the world watching exactly how the EU will deliver its international and domestic
ambition in fighting climate change, strengthening the legislative proposals on effort sharing and
emissions trading will be of crucial importance. Failing to do this or, even worse, trying to weaken
the proposed legislation will have direct consequences on the international arena. EU Member
States and the Members of European Parliament must rise to this challenge. They now not only
bear a responsibility towards the current and next generations of European citizens but also to the
future of this planet.




3
  www.cdmgoldstandard.org
4
  OXFAM estimated that the financial need for adapting to the effects of Climate Change in developing coun-
tries amounts to 50 billion US dollars.
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                                        KEY NGO DEMANDS

·An overall 30% domestic EU reduction target compared to 1990 emission levels
·On top of the domestic reduction effort the EU has to commit to binding, measurable and verifi-
able greenhouse gas mitigation and adaptation efforts in developing countries. The financial effort
required amounts to around 21 Billion EUR for the EU 27 for mitigation alone.
·The compliance and enforcement of emission reduction targets for non-EU ETS sectors must be
as strong as those in place for companies under the EU ETS. The Commission should be given
the strongest enforcement tools available to make sure that Member States reduce their emissions
in a linear annual manner as foreseen in the proposals.
· External credits should only be eligible for use if they fulfil strict criteria (verifying their climate
benefit and guaranteeing their environmental and social integrity). At a minimum, CDM projects
must be required to meet the CDM Gold Standard.
·Full auctioning should be the default allocation method in the EU ETS from 2013.
·50% of the revenues from auctioning allowances in the EU ETS should be used for adaptation to
current and future damage caused by climate change and for mitigation in developing countries.
The other 50% of the auctioning revenues shall be used in the EU for supporting the development
and market introduction of greenhouse gas reduction instruments and technologies.




Contacts:

Matthias Duwe Director, Climate Action Network Europe,
E-mail: matthias@climnet.org, Tel: +32 2 229 5220

Mahi Sideridou, EU Climate & Energy Policy Director, Greenpeace European Unit,
E-mail: Mahi.Sideridou@diala.greenpeace.org, Tel: +32 2 274 1904

Stephan Singer, Head of the Climate Change Unit,WWF European Policy Office,
E-mail: ssinger@wwfepo.org Tel: +32 2 743 8817

Sonja Meister, Climate Campaigner, Friends of the Earth Europe,
E-mail: sonja.meister@foeeurope.org Tel: +32 4849 75107.