InsideCounsel » April 2008
Earth Savers
European Union sets ambitious course to combat climate change.
The European Union, it seems, is bent on saving the world. On Jan. 23, the European Commission (EC) announced an ambitious, detailed plan to fight climate change and promote renewable energy to achieve the goals its leaders formulated at the March 2007 European Council.
Those goals include a 20 percent reduction in greenhouse gas emissions, a doubling to 20 percent of energy produced from renewable sources like wind and solar power, a 20 percent increase in energy efficiency and a 10 percent biofuel component in transportation fuel—all by 2020.
To reach the goals, the plan establishes national targets that will become law if passed by national governments and the European Parliament.
In general, the targets ask more of the wealthy nations than the poor. For example, the plan contemplates that Sweden will meet 49 percent of its energy needs from renewables, while Malta only needs to reach 10 percent. Denmark must cut emissions by 20 percent, but Bulgaria and Romania can let them rise by the same amount.
“The proposal still has to get by the European Council and the European Parliament before it becomes law,” says David Haverbeke, associate at Lydian in Brussels. “What will remain after these processes is unclear.”
It’s not just the member states that will be horse-trading over their obligations. Already business has criticized the plan, which EC President José Manuel Barroso has estimated as costing $86.6 billion and has said is too expensive or too damaging to certain sectors.
“There’s a whole lobby machine working intensively to lower the plan’s goals,” says Wim Vandenberghe, head of DLA Piper’s litigation and regulatory practice in Brussels.
Tough Targets
The business community’s objection is simple: It does not believe the plan’s targets can be achieved.
“It’s important to appreciate that industry is already making heavy investment in technology that consumes less, so perhaps the reduction side of the plan might work,” Haverbeke says. “But doubling green generation by 2020 is just not feasible.”
Because the targets vary from member state to member state, some countries will have to more than double the energy produced from renewable sources. Belgium, for example, now generates 2 percent of its energy needs via green energy, but the plan requires it to triple the green component to 6 percent by 2010.
“I’m involved in quite a few projects that have no hope of reaching that target,” Haverbeke says.
Vandenberghe also believes that there will be changes.
“But the changes won’t be in the broad overall targets, because the states agreed on these in March 2007,” he says. “Where the changes will come is in the apportionment between nations and in the pace and manner of implementation.”
