The program reinforces action at national level to control emissions, which are rising at a "worrying" rate. Under the Kyoto Protocol, the EU is committed to an 8% reduction of six greenhouse gases during 2008-2012 from 1990 levels. To meet this target, member states have negotiated national commitments under a "burden sharing" agreement. But emissions are still increasing, and at present rates will rise to 8% above 1990 levels. "Most countries are not on track for reaching their national targets," comments Wallstrom. Additional measures at the community level are needed, she says, stressing the need for "energy taxation within an overall strategy on climate change." Wallstrom blames government heads for failing to pursue the EC's proposal for an energy tax and for weakening the Save and Altener programs.
She proposes a series of policies and measures, focusing on areas of highest potential emissions savings. Among these are improved grid access for dispersed electricity production to help renewables, increased combined heat and power, more technology research and development, and an EU framework for emissions trading. Working groups will report back within 12 months, and from their findings the commission will develop concrete proposals.
The program launch coincides with the commission's proposal for a system of "emissions allowances" trading between EU companies by 2005. This will pave the way for international emissions trading -- also agreed to at Kyoto -- that could begin in 2008. The EC prefers an EU framework to a set of national schemes as this could knock nearly 20% off the cost of meeting the EU's Kyoto commitments, or some EUR 1.7 billion a year.
It proposes a step by step approach, initially confining trading to large fixed point sources of CO2 in the energy production and energy intensive sectors. Carbon dioxide accounts for 80% of the EU's greenhouse gas emissions. Key questions still to be answered are who should take part? How and by whom should allowances be allocated? How compatible is emissions trading with other measures such as energy taxes and energy efficiency? The commission seeks views by September 15.