Friday, February 22, 2008

Second thoughts from the commission?

Despite its avowed determination to force cuts in "greenhouse" emissions, the EU commission, we are told, is having second thoughts on how to deal with heavy industry.

Earlier, as we reported, the commission was forced to confront the reality that, if it imposed stringent quota cuts on Europe's steel, chemical and power sectors, it would do irreparable damage to them. Many players in steel and chemicals had threatened to move offshore.

Now, it seems, the commission is prepared to hold back on plans for these sectors to buy "carbon permits" from 2013, an impost which was set to raise manufacturing costs by €50 billion a year and increase electricity prices by 10-15 percent.

Needless to say el presidente Barroso is not abandoning the idea altogether (someone has to pay for those MEP expenses) but is looking at an "interim solution". He thus is suggesting that the commission should either continue, pro temp, with the current practice of giving energy-intensive industries free permits, or to require importers to obtain allowances alongside European competitors, so equalising the misery.

It also looks like another climb-down is on its way. The Economist is suggesting that, with a chorus of dissenting voices growing against the use of biofuels, it is going to drop its target for 10 percent biofuels by 2020.

Quite where all this leaves the EU with its ambitious plans to cut “greenhouse gasses” by zillions of tons by 2020 is anybody’s guess. But it looks like its overall scheme is going to be about as successful – even in its own terms – as the common fisheries policy – not that this should surprise anyone. What would really be the surprise would be that anything the commission turned its hand to in the real world might actually work.


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