Luxembourg - European Union environment ministers on Wednesday shelved a bitter dispute over roughly 150 billion dollars' worth of greenhouse-gas emissions permits to begin setting out the bloc's demands for a global climate-change deal in December. The agreement takes some of the heat out of a row between Eastern and Western member states which on Tuesday deadlocked talks between finance ministers, but leaves the most sensitive problems unsolved.
"This should be seen as a clear message to the world that the EU is prepared for (United Nations) negotiations" in Copenhagen in December, Sweden's environment minister Andreas Carlgren, who brokered the deal, said.
Sweden currently holds the EU's rotating presidency.
The ministers' deal calls on the EU to cut its emissions to 80-95 per cent below 1990 levels by 2050 if other developed economies sign up to similar cuts in Copenhagen. The EU is currently committed to cutting emissions to 20 per cent below 1990 levels by 2020.
It also commits the bloc to pushing for binding worldwide emissions-reduction targets for airlines and shipping companies, to 10 and 20 per cent respectively below 2005 levels by 2020.
Making the companies buy permits to emit greenhouse gases could provide "very important sources of additional funding" for poor countries to help fight climate change, EU Environment Commissioner Stavros Dimas said.
But ministers failed to agree what to do about billions of dollars' worth of emissions permits, called Assigned Amount Units (AAUs) and nicknamed "hot air", created by the Kyoto Protocol.
According to EU officials, former-Communist states such as Russia, Ukraine, Poland and the Baltic States currently hold between 7.5 billion and 10 billion AAUs, with an estimated market value of 75-100 billion euros (112-150 billion dollars).
The EU's eastern members are fighting for the right to sell the permits. But Western states say that using the permits would destroy efforts to stop global warming because other governments would buy the permits and use them to pay fines for excess emissions, rather than trying to reduce their emissions.
"What we have to deliver for the next weeks is not hot air for sale, but real reductions," Denmark's climate minister Connie Hedegaard, who is to chair the Copenhagen meeting, said.
At the meeting, Poland tabled a compromise proposal which would have given Eastern states unlimited opportunities to boost their own emissions by paying for the increase with their AAUs, but would have limited their ability to sell them abroad.
That idea was "unacceptable for other member states," Carlgren said. Environment ministers will come back to the question before the Copenhagen talks, he said.
However, their next scheduled meeting is not set until the end of December, after the Copenhagen talks end, making it likely that they will have to hold an extra meeting in November.
Wednesday's meeting finalized the EU's stance on a wide range of issues ahead of the Copenhagen talks.
It called, for example, for rich states such as the US and Canada to set up their own systems for trading industrial emissions permits and to link them with the EU's one by 2015. Rising powers such as India and China should join by 2020.
It also called on the rising powers to make their emissions in 2020 some 30 per cent lower than they would have been without efforts to fight global warming.
And it called on forested states such as Indonesia and Brazil to manage their forests rather than cutting them down, offering to reward them with credits on the international emissions market.
But the EU still has to solve the question of AAUs and the larger question of how to pay for poorer countries to fight global warming.
On Tuesday, EU finance ministers failed to agree on even the basics of such a financing plan, in a damaging row between Eastern and Western member states.
That question is now set to go to the bloc's next summit on October 29-30. EU diplomats say that the debate is likely to be long and bitter, as billions of euros ride on the result and every member state has the right to veto proposals.
