European Carbon Intensive Industries Subject To New Investment Rules By 2009
The main two factors about large scale plans to reduce greenhouse gases are the costs involved and the speed of implementation. European leaders appear to have opted to give speed priority and despite the fact that they baulk over costs involved, they said last Friday that they will stick to the goals they set themselves.
Europe’s agenda has yet to become clear but carbon footprint reduction plans on a sector by sector basis are materializing. Energy intensive industries are likely to face new rules as early as 2009 if an international new carbon reduction protocol hasn’t been reached before that time. New investments by these companies are going to be subject to new rules on legal preconditions.
Europe’s overall objective is to reduce carbon dioxide emissions by 2020 through a mixture of rules including relying on power generation by renewable energy sources for 20 percent of all energy needs. The 27 European countries also aim to have 10% of all transport fuelled by biodiesels.
One of the main factors undermining these efforts is the economic situation, which many leaders say makes investments in the environment seem unjustified. However, most of this thinking is related to short term turmoil on the financial markets. The avoidance of ‘excessive costs for member states’ was a precondition that European leaders made in their statement at the end of the meeting last Friday. Europeans have been more aggressive than the US in lobbying for climate change, but even they themselves are now citing the economy as having a prevalence over the environment.
Europe aims to reach 2020 greenhouse gas reduction targets by stepping up use of wind, solar, hydro, wave power and biofuel energy. Europe is leading the way in carbon trading. The carbon trading programme is Europe’s main effort to fight global warming. Companies that participate in carbon trading programs include those in the steel, cement, paper and aluminium industries.Business leaders that fear that they’ll become less competitive due to the carbon regulations were told that there are several flexible ways in which to achieve the targets. They were also told that leaders are thinking up ways to protect their industry against competition from companies which face less stringent carbon emission rules. Stopping short of a green tariff, some sort of compensation here might be on the cards; importing companies might very well be mandated to participate in carbon trading to offset the imported carbons.