BRUSSELS, April 30 - The refining, cement and
glass industries may get help dealing with the cost of meeting
European climate targets to safeguard their global
competitiveness, a draft European Commission report showed.
Steel and aluminium appear to be the most at risk, figures
seen by Reuters on Thursday showed, confirming a report last
year on risks to the two sectors.
Heavy industries in Europe and the United States are
battling hard to avoid paying for permits to emit carbon
dioxide, saying the added cost will harm their ability to
compete with overseas rivals, for example in India and China.
But environmentalists say politicians risk pushing the
planet further towards catastrophe by making too many
concessions to big polluters.
They also warn that the EU risks undermining its main tool
for curbing climate warming emissions, the Emissions Trading
Scheme (ETS) by handing windfall profits to industry.
The Commission's list was based on data from the EU's 27
governments, and that had given industry ample opportunity to
massage the figures, said campaigner Sanjeev Kumar of WWF.
"Should we trust governments to give accurate data? We've
been conned before," he added. "There have been cartel cases in
European cement and steel recently, so how can you trust the
trade data from those markets?"
The European Union agreed last year to cut CO2 emissions to
a fifth below 1990 levels by 2020, seeking to lead the world in
combating climate change and the floods, drought and famine it
is expected to bring.
But it deferred a decision on which industries should be
exempted from buying permits from 2013 under the ETS.
A draft report on potential exemptions was circulated on
Wednesday at a meeting between the European Commission, the 27
EU nations and representatives of industry and environmental
Sectors such as aluminium that face an increase in costs of
over 5 percent and have a high "trade exposure" are deemed at
risk from overseas competition and will probably receive free
permits to pollute between 2013 and 2020.
Aluminium, with a projected cost increase of 11.8 percent
was deemed as one of the sectors most at risk, followed by steel
with costs up 11.3 percent.
Campaigner Tomas Wyns at Climate Action Network challenged
the Commission's methodology, and said it should check its
"The Commission is treating big oil very kindly," he added.
"It is handing out hundreds of millions of euros to some sectors
A Commission spokeswoman said the list was preliminary and
would have no impact on EU carbon dioxide emissions, which are
controlled by the carbon market's steadily-reducing cap.
The main impact of free permits will be reducing the amount
of money generated by the ETS, much of which is earmarked for
green technology and to help poor regions like Africa deal with
the consequences of climate change.
(Editing by Dale Hudson and James Jukwey)
Copyright 2009 Reuters