EU leaders are preparing a clash over how to implement climate goals

European leaders are colliding on the imminent impact of radical emissions targets on their citizens and businesses, as the cost of getting green comes home across the EU.

A summit in Brussels on Monday and Tuesday will be dominated in part by debates on how to decarbonise areas of the European economy so that the bloc can meet its goal of reducing CO2 emissions by 55 percent by the end of the decade.

In particular, the summit may open up distribution issues to the heart of the green agenda as it will impact voters ’disposable income by increasing household energy bills, raising food prices and costs.

Officials expect a divisive debate pitting the richest countries in Western Europe against their poorer and more polluting counterparts in the south and east. As a sign of the contention that the debate may show, the ambassadors clashed on Friday over the draft environmental conclusions of the meeting.

An EU official said the summit would see leaders “reaffirming their sensibilities and priorities” in the climate debate, warning that many of the compromises would be “very difficult to resolve”.

One of the biggest battles will be how to set emission targets for industries not subject to the EU’s carbon pricing mechanism, as well as controversial plans to expand the scope of this emissions trading scheme (ETS ) to sectors such as the automotive industry.

Poland is leading the charge for substantial financial compensation to cushion the blow of the EU’s next plans, which it says will disproportionately target the poorest and most vulnerable households in its fossil fuel-dependent economy.

In July, the European Commission will propose legislative measures to establish the legal way for the bloc to achieve its revised target of reducing at least 55%. carbon emissions in 2030: a previous commitment of 40%.

Brussels will propose a series of far-reaching measures, including the potential expansion of the ETS to retail sectors such as the car and heating. If it goes ahead, households will have to bear part of the cost of Europe’s record price on heating bills and fuel pump prices. The price of EU carbon has exceeded € 50 a tonne of carbon in the last month.

The commission will also unveil its design for a carbon tax levy on imports. The measure is backed by EU companies such as steel, which are concerned that foreign competitors with higher emissions will be affected. But it has already sparked concern Russia, Ukraine, Turkey and other EU trading partners.

Brussels will also present new targets for renewable energy and update its forestry regulations to boost Europe’s carbon footprint.

Reaching an agreement on this set of commission measures will be an unprecedented feat for the EU, which has embarked on one of the most radical decarbonisation agendas of any developed economy. The EU aims to become the first continent to achieve zero zero carbon emissions by 2050.

But the nature of the bloc’s 27 member states, with their various economic models and energy mixes, means finding agreement on how to make decarbonisation a reality will be extremely difficult.

All elements have the potential to set member states down. With regard to forestry, for example, the Czech Republic is concerned about its ability to achieve its carbon reduction target due to the damage caused to its huge forests by bark beetles, an issue that has already been pointed out. Prime Minister Andrej Babis.

Leaders will also discuss how carbon reduction costs are shared among the poorest and richest countries. Under what is known as an effort-sharing regulation, which covers 60% of total EU emissions, the poorest states must do proportionately less than the richest.

The right is fiercely protected by the countries of the south and east. However, countries such as Denmark and the Netherlands want the commission to update the criteria so that richer, smaller countries do not bear most of the burden of European decarbonisation.

As for the other 40% of EU emissions, which are covered by the bloc’s ETS carbon pricing mechanism, Brussels has to decide whether to extend the system to sectors such as buildings and cars.

Hungary is among the countries that have opposed the extension, while Poland demands a larger share of the system’s revenue for countries that are more dependent on fossil fuels. Any agreement will need the support of a super majority of member states and MEPs.

Bas Eickhout, the Dutch Green MEP, said the leaders’ summit was being held at a “bad” time, just a few weeks before the Commission’s proposals. He warned that the inclusion of sectors such as cars in the ETS should not allow car manufacturers to escape the strict national regulations on CO2 emissions that have been established since 2019.

“We hope the heads of state and leaders give a clear message to the Commission not to put all the eggs in the ETS basket,” Eickhout said.