1. EU leadership in climate change policy ? Rob Bradley, Climate Action Network Europe

2. Who is Climate Action Network Europe? • We focus on climate change • 85 European member organisations • More than 300 members of the Climate Action Network (CAN) • Global perspective • CAN a major player in the Kyoto process Rob Bradley, Climate Action Network Europe

3. What is climate leadership? • International dimension – ratification, coalition building, engagement with developing countries • Meet own target with strong and credible policies and measures • Show that technology forcing and creative PAMs achieve real emission cuts without economic disaster Rob Bradley, Climate Action Network Europe

4. Perverse subsidies Liberalisation increases energy demand Security of supply => more coal Export and trade policies Climate Policy Climate policy in the EU Rob Bradley, Climate Action Network Europe

5. Competitiveness worries Rob Bradley, Climate Action Network Europe

6. Energy market liberalisation • Slow and halting progress towards total market opening • Market still badly distorted by subsidies and strong incumbents • Lower prices and supply-focused reform make demand management very difficult Rob Bradley, Climate Action Network Europe

7. Security of supply • Issue raised to provide cover for coal and nuclear subsidies • Main threat in oil, but most action proposed in electricity • 15% rule explicitly allows market protection for favoured technologies Rob Bradley, Climate Action Network Europe

8. Domestic politics • Coal industry restructuring • Lobbying weight of the energy sector • Concerns over fuel poverty • Reluctance to tackle transport Rob Bradley, Climate Action Network Europe

9. So how are we doing? • Nice coherent package on paper • ECCP, ET, Kyoto mechanisms, member state actions balanced EU world champion at saying the right thing! Rob Bradley, Climate Action Network Europe

10. Emission trading: the proposal • Absolute cap to cover large point emitters • Target setting and allocation to be done by member states • Unrestricted trading within this cap • Compliance penalty €100/tonne (or 2x permit price) plus restitution Rob Bradley, Climate Action Network Europe

11. Emission trading: the debate • How does this sit with pre-existing climate policies? • Mandatory or voluntary? • Links with other mechanisms • Sector and gas coverage Rob Bradley, Climate Action Network Europe

12. Emission trading: the prospects • Germany opposed, UK going solo, many uninterested • Majority voting makes blocking hard • Growing enthusiasm among (non-German) industry • NGOs gradually warming to the idea Rob Bradley, Climate Action Network Europe

13. ECCP initiatives • Energy efficiency in buildings • Energy services/ DSM • Biofuels • Fluorinated gases • Cogeneration Rob Bradley, Climate Action Network Europe

14. Energy efficiency in buildings • Non-prescriptive approach – based on auditing requirements and some reporting • Was supposed to save 45 million tonnes CO2 • Timelines postponed too late to help with Kyoto Rob Bradley, Climate Action Network Europe

15. Energy services/ DSM • Energy services are the “magic bullet” of climate and liberalisation • DSM aspects of liberalisation legislation mostly rejected • Everyone seems unsure what this directive should even contain Rob Bradley, Climate Action Network Europe

16. Biofuels • Proposed Directive makes no attempt to ensure environmental advantages from biofuels • Commission estimates 100-150 Euro per tonne CO2 abatement cost • “Environmental” measure has become another agribusiness subsidy plan Rob Bradley, Climate Action Network Europe

17. Fluorinated gases • Commission proposing to amend reg. 20/37 on O3 depleting substances • Risks concentrating on containment (the “consensus”) • Needs to move much further in encouraging adoption of alternatives Rob Bradley, Climate Action Network Europe

18. Cogeneration Directive • Need for Directive as CHP often treated poorly in market liberalisation • Targets abandoned • Talk bogged down on definitions • Commission went slowly, now with Parliament Rob Bradley, Climate Action Network Europe

19. Fiscal measures • Many countries have electricity and/or carbon taxes • Proposal for harmonisation since 1992 – going nowhere slowly • Concerns include fuel poverty (UK), inflation (Spain) and competitiveness (everybody) • Tackling subsidies is even harder, but possibly more important Rob Bradley, Climate Action Network Europe

20. And against that… • Continuing subsidies to coal, nuclear and even to natural gas • Structural funds skewed in favour of road transport • Export credits, IFIs, bilateral aid… Rob Bradley, Climate Action Network Europe

21. The need for coherence • ECCP was a package for a reason • Perverse effects from unbalanced policy implementation – e.g. emission trading and trains • Many parts of government still have to realise that climate policy exists • EU policy famously multidirectional – this will not be temporary! (fishing, tobacco) Rob Bradley, Climate Action Network Europe