Industry body Eurofer says the rules for the Emissions
Trading Scheme (ETS) do not fairly set a benchmark that would
allow the industry’s most efficient 10 percent of factories to
get free pollution permits after 2013.

“Nowhere in the world is a steelworks that could operate its
plants at the level of this benchmark,” Eurofer Director General
Gordon Moffat said in a statement.

The European Commission, which oversees the ETS, could not
be reached to comment on the challenge, launched at the European
Court of Justice, the highest court in the EU.

The European Union aims to cut carbon dioxide emissions to
20 percent below 1990 levels over the next decade. Its main tool
for doing that is the ETS, which forces companies to acquire
permits for each tonne of carbon they emit.

Some industries, including steel, have been given permits
for free to prevent their costs rising above those of overseas
rivals.

That has often translated into windfall profits worth tens
of millions of euros for the companies involved, such as steel
giant ArcelorMittal .

From 2013, the EU aims to tighten up the ETS to eliminate
such windfall profits, and only the 10 percent most efficient
plants, which meet an efficiency benchmark, will receive free
permits.

It is these benchmarks that have caused the dispute.

The steel industry says its installations recycle waste
gases as an additional source of energy and has criticised the
decision not to give credit for that in the benchmarking
process.

“This is a clear infringement of the ETS directive, as the
best performers will be short of free allowances,” Moffat said.

Eurofer says the problems it sees with the benchmarks will
cost the industry about 5 billion euros ($7.1 billion) in the
period 2013-2020.

(Reporting by Pete Harrison, editing by Rex Merrifield)

($1 = 0.704 Euros)

Guenther Oettinger said biofuels’ indirect impacts were dangerous for the planet’s carbon balance and food supply.

“It is a real concern … particularly in the big producing countries, southeast Asia and in South America,” Oettinger told reporters. “This is an evolution which we cannot accept.”

The European Union agreed three years ago to get 10 percent of its road fuels from biofuels — at a time when such fuels were widely regarded as good for the environment — but since then controversy has raged in Europe over the target.

Oettinger took a first step toward limiting biofuels’ impact on the environment on Tuesday, launching a green standard to prevent companies from clearing forest, peatlands or grassland to grow biofuels for the European market.

The European biofuel market is expected to grow to about $17 billion a year and is being eyed by European farmers as well as growers of sugarcane in Brazil and palm oil in southeast Asia.

Oettinger named seven certification schemes, including Bonsucro and Greenenergy for Brazilian sugarcane, and the Round Table on Responsible Soy Association.

DEFORESTATION

But environmentalists were unimpressed, including activist lawyers ClientEarth, which sued the Commission in May for more details of its selection process.

“The way that this has been handled underlines the Commission’s practice of shutting out meaningful public participation in the development of its biofuels policy,” said ClientEarth lawyer Janet Pritchard.

Critics say the EU’s biofuel target creates an incentive for farmers to hack directly into forests to create space to grow fuel crops — known as direct land use change.

But they also charge that even biofuel crops planted in Europe can send shock waves through global food markets and indirectly promote deforestation — indirect land use change.

Recent research shows that when more food is needed, the majority of new farmland, possibly as much as 80 percent, comes from burning down forests.

“That would be dangerous for the CO2 balance if valuable rain forests no longer exist, and it can also be a problem in terms of ensuring that there is sufficient food in the region in question, in order to avoid famine,” Oettinger said.

Many biofuels are now thought to be worse for the climate than the fossil fuels they are intended to replace.

The European Commission’s own research shows it may lead to an indirect one-off release of around 1,000 megatonnes of carbon dioxide — over twice the annual emissions of Germany.

The industry argues that the science is still too uncertain to challenge the law.

“We can’t quantify it,” Oettinger said, adding that a new European strategy on the issue would be launched this year.

Research commissioned by Oettinger shows the biggest indirect impact comes from biodiesel from European rapeseed, Asian palm oil and South American soybeans.

A Greenpeace report on Tuesday showed those biofuels at sale at fuel stations around Europe.

The EU’s farming commissioner argues against redrawing the investment map overnight, and the Commission looks set to cushion the biodiesel industry.

But not all farmers favor the growth of biofuel.

Some agriculture ministers meeting in Brussels demanded a review on concerns that biofuels were pushing up the price of animal feed and, in turn, meat.

“A review of the EU policy on biofuels due to its relation to the increase of feed prices was requested by some delegations,” said notes from a discussion of the beef sector.

(Additional reporting by Charlie Dunmore, editing by Rex Merrifield and Jane Baird)

The new rules force national nuclear authorities to draw up disposal plans by 2015, which will be vetted by Europe’s energy commissioner Guenther Oettinger.

“After years of inaction, the EU for the very first time commits itself to a final disposal of nuclear waste,” Oettinger said in a statement.

The 14 European Union member states using nuclear power currently store the radioactive waste in surface bunkers or warehouses for decades while it cools down.

But crises such as Russia’s wildfires last summer and leakage at Japan’s stricken Fukushima plant have highlighted the risks posed by surface storage.

Nuclear energy has not been popular in Europe since the 1986 Chernobyl disaster, but it is even less so since Fukushima, and Germany has even agreed to phase out nuclear power completely by 2022.

DEEP STORAGE

Oettinger has made nuclear safety one of the main issues of his five-year tenure, pushing ministers to develop a pan-European safety strategy for the first time.

The first step in that strategy is a series of “stress tests” on nuclear plants, which started in June.

The second is Tuesday’s decision to dispose of spent nuclear fuel in secure repositories.

Oettinger’s team, which will vet the national strategies, has already stated its preference for “deep geological repositories” — caverns to be built in clay or granite rocks between 100 and 700 meters underground.

“National programs have to include plans with a concrete timetable for the construction of disposal facilities,” they said in a statement.

Safety standards drawn up by the International Atomic Energy Agency will also become legally binding as part of the plan.

Oettinger had initially proposed a total ban on exports of radioactive waste to other countries for reprocessing, but ministers created a loophole for future exports. Instead, waste can be shipped to countries that already have deep geological storage.

“At present, such deep geological repositories do not exist anywhere in the world nor is a repository in construction outside of the EU,” said Oettinger’s team. “It takes currently a minimum of 40 years to develop and build one.”

The EU’s 143 nuclear plants produce about 50,000 cubic meters (1.77 million cu ft) of radioactive waste each year, says nuclear industry body Foratom. About 15 percent of that is high level waste.

(Reporting by Pete Harrison, editing by Rex Merrifield)

The EU aims to lead the world in fighting climate change,
and says it needs to put a price on carbon dioxide emissions to
guard against future climate impacts such as crop failures,
droughts or flooding.

From January 2012, airlines flying to or from Europe will
have to buy permits from the EU’s Emissions Trading Scheme (ETS)
for 15 percent of the carbon emissions they produce during the
entire flight. They join 11,000 factories and power plants
already in the scheme.

China criticised the scheme on Tuesday ,
adding to fears of a brewing trade war.

The Air Transport Association of America (ATA) mounted its
challenge to the EU on two main fronts — that its climate
regulations breached U.S. sovereignty, and secondly that they
comprised an illegal charge under the main international treaty
on air travel, the Chicago Convention.

“The EU does not have competence to regulate third country
airlines in third country airspace,” Derrick Wyatt, a lawyer for
ATA, told the European Court of Justice in Luxembourg.

“It is astonishing that a U.S. airline must acquire an EU
licence to cover emissions at a U.S. airport.”

On a typical San Francisco to London flight, just under 9
percent of emissions occur in the EU, compared to 25 percent
over the Atlantic, 37 percent over Canada and 29 percent over
the United States, he added.

PREFERRED OPTION

EU lawyers said the cost of emissions permits for a
transatlantic flight amounted to little over 6 euros per
passenger, most of which the airlines would be granted for free.

They said the bloc had only chosen to include aviation in
its carbon market after airlines themselves chose the scheme in
preference to other tools such as eco-taxes or charges on jet
fuel.

“A market-based system is the system that IATA and the
airlines have always been urging — a system that is the most
economically efficient, as they recognise themselves,” said
European Commission lawyer Eric White.

“The claimants seem to think that extra-territoriality
equals illegality — of course that’s not the case,” he added.

Other EU lawyers also made the point that many valid laws
have an indirect impact in third countries, such the need for
travel visas or U.S. demands for the personal data of arriving
air travellers, but that does not render them illegal.

As a further example, European road safety laws prevent
truck drivers from driving more than nine hours in a day, even
if the first part of the journey takes place outside the EU,
argued Sam Wordsworth, on behalf of the British government.

Airlines say their emissions should only be tackled in U.N.
bodies, such as the International Civil Aviation Organization
(ICAO), which have clear rules to prevent countries imposing
illegal charges on each others’ airlines.

EU lawyers countered that ICAO had already ruled that the
ETS was quite distinct from, and preferable to, other charges
such as eco-taxes or jet fuel levies.

Environmentalists said global talks to find a solution to
aviation’s emissions had dragged on for 14 years, and airlines
should not attack the only meaningful piece of regulation.

“Instead of flying planeloads of lawyers to Europe, the
aviation industry should face up to its future and get on with
the job of cutting emissions,” said Bill Hemmings of green
transport campaigners T&E.
(Reporting by Pete Harrison, editing by Rex Merrifield and
Anthony Barker)

The EU-mediated talks target a tangle of problems crucial to Kosovo’s daily existence, which are a legacy of Serbia’s refusal to recognize its secession in 2008, but sidestep the question of Kosovo’s independence.

Under Saturday’s deal, the two sides will recognize national identification cards and education diplomas issues by each state, making travel easier and allowing for better access to jobs, particularly for Kosovars seeking employment in Serbia.

Belgrade has also agreed to share copies of Kosovo’s civil registry, crucial for the smooth operation of the judiciary and combating organized crime which is rife in the region.

“In particular the agreement on free movement is important,” EU mediator Robert Cooper said.

“An agreement on free movement in the Balkans in a material way not only helps ordinary people lead more normal lives, but makes it into a more European area.”

In return, Kosovo made concessions on the validity of its car registration plates, and any cars with newly issued plates will have to get a substitute at the Serbian border.

Many other issues remain unresolved. But progress is key to Kosovo’s struggling economy and will likely determine whether Belgrade or Pristina can move toward fulfilling EU membership aspirations.

In the short-term, Kosovo hopes to win visa-free travel to the EU, while Serbia is aiming for a green light to start EU accession talks.

Belgrade’s EU prospects have improved significantly in May when authorities apprehended war-time general Ratko Mladic, wanted by a U.N. tribunal on genocide charges.

But EU officials say they want to see some steps toward reconciliation with Kosovo before launching negotiations.

Serbia lost control of Kosovo, an impoverished landlocked province of 2 million people, in 1999 when NATO waged a bombing campaign to halt killings of ethnic Albanians in a counter-insurgency war.

Cooper, who has mediated negotiations since March, said the talks did not broach the subject of Kosovo’s independence.

“These agreements … don’t involve anyone giving away their positions. They do not prejudice the position of either state with respect to the status of Kosovo,” he said.

Many Serbs see Kosovo, where 90 percent of the population are ethnic Albanians, as the cradle of their Orthodox Christian religion, and any compromise on the province’s status could be a tough sell in Serbia.

Kosovo is recognized as an independent state by 75 countries, including the United States and most of EU members. Russia and China do not recognize Kosovo.

(Editing by Justyna Pawlak and Alison Williams)

The EU aims to lead the world in fighting climate change, and says it needs to put a price on carbon dioxide emissions to guard against future climate impacts such as crop failures, droughts or flooding.

From January 2012, airlines flying to or from Europe will have to buy permits from the EU’s Emissions Trading Scheme for 15 percent of the carbon emissions they produce. They join 11,000 factories and power plants already in the scheme.

Airlines warn of a looming trade war, but the EU says it will not back down. The carriers say their emissions should only be tackled in United Nations bodies, such as the International Civil Aviation Organization (ICAO).

The U.S. government demands an exemption. And on July 5, the Air Transport Association of America (ATA), American Airlines and United Continental will seek to overturn the EU scheme at Europe’s highest court.

EU officials say the international talks at ICAO have dragged on since 1997 without bearing fruit and they can wait no longer to start dealing with airlines’ emissions.

“We have been patient for many years,” EU climate commissioner Connie Hedegaard told Reuters. “Global solutions? I’m all for it. The EU has been fighting for global solutions for many years — unfortunately, without enough success.”

EU lawyers will argue at the European Court of Justice in Luxembourg that the EU only included aviation in its emissions scheme after receiving implicit approval from the U.N. body.

They will also point to the fact that airlines themselves chose the scheme — in preference to other tools such as eco-taxes or charges on jet fuel. That stance is well documented.

“Extending the EU ETS to cover aviation is probably the least-cost and most effective way of dealing with aviation’s climate impacts in Europe,” Brian Pearce, the chief economist of the International Air Transport Association (IATA), wrote in a paper in 2007, when the EU was preparing the move.

Economic analysis by IATA, which represents 93 percent of air traffic, concluded at the time: “The impact on airline profits would be marginal.”

U.S. airlines have pursued a similar line at home, with ATA telling Congress that an emissions trading scheme would be roughly a third of the cost of taxes or fuel levies, in a letter seen by Reuters.

Hedegaard added: “The question now is: For how long can a truly global sector claim they want to contribute but not take action and deliver solutions?”

Airlines deny they have zig-zagged to avoid regulation, and say their only complaint is with the detail of the EU scheme.

“We welcome the steps the EU took in designing an ETS for aviation, because we see a global ETS-type program as one of the options at the global level,” IATA’s director of environment, Paul Steele, told Reuters.

“It’s not about challenging the whole ETS,” he added. “It’s primarily the fact the EU is trying to impose the ETS on third- country airlines for flights that largely take place outside European air space. It’s the extra-territorial aspect.”

Court papers show the U.S. airlines will argue that only their own government has the right to regulate them as they fly over the north American continent or the Atlantic ocean. They will also say the EU has broken aviation’s main treaty, the Chicago Convention.

“We are very concerned about the prospects of a trade war,” said Steele. “It’s not going top solve anybody’s issues, and it certainly won’t reduce CO2 emissions.”

(Reporting by Pete Harrison, editing by Rex Merrifield)

EU Energy Commissioner Guenther Oettinger proposed new
rules in December to prevent market abuse in a wholesale market
estimated to be worth around 500 billion euros ($708 billion)
per year.

“As the EU internal energy market for electricity and gas is
becoming more and more liberalised and interconnected, the
potential for abuse and manipulation is also growing,” said a
statement from EU government negotiators.

“The proposed regulation sets up a framework for monitoring
wholesale energy markets in order to detect market abuse and
manipulation, thereby ensuring the integrity and transparency of
those markets,” it added.

A team of about 15 market monitors, based at the Agency for
the Cooperation of Energy Regulators (ACER) in Slovenia, will be
handed extensive powers to collect market data and act on
manipulative behaviour and insider trading.

The deal, which still needs approval by the European
Parliament, forces energy traders and other market participants
to sign up to national register and ACER’s European register.

Wednesday’s agreement also outlines the levels of fines for
non-compliance, aimed to be “proportionate, dissuasive and
effective”.

ACER will also have access to data on the trade of carbon
emissions permits in the EU’s Emissions Trading Scheme (ETS) to
prevent cross-market and cross-commodity abuses. The European
Parliament has already pushed for that option.

The EU’s executive Commission may follow up with a specific
proposal for regulating the ETS, which forces 11,000 factories
and power suppliers to obtain permits for each tonne of carbon
they emit.
(Reporting by Pete Harrison, editing by Rex Merrifield and
Anthony Barker)

($1=.7062 Euro)

The EU, home to 500 million people, has set a target for cutting average emissions from new cars to 130 grams of CO2 per kilometer by 2015.

Last year’s improvements bring the average emissions of new cars to 140 grams, putting the EU on track to overachieve on a target that was set in 2008 despite heavy lobbying from car makers in Germany, France and Italy.

In 2009, car emissions fell 5.1 percent.

“These data show again that setting targets… stimulates the car industry to put greener cars on the market,” said EU climate commissioner Connie Hedegaard. “These innovations also ensure Europe’s car industry remains competitive in the changing global market.”

The weight of cars rose by 28 kg in 2010, after falling in 2009, a trend that environmentalists blamed on increasing numbers of small sports utility vehicles (SUVs).

“That is no surprise,” said Arne Richters at transport campaigners T&E. “EU rules favor heavier cars by allowing them to emit more CO2. The EU should be favoring more efficient saloons, estates and hatchbacks rather than encouraging gas-guzzling, tall and heavy SUVs.”

Car industry group ACEA says cars with emissions below 120g per km now have a 29 percent market share.

“Most of the progress so far has been achieved through improved efficiency in the internal combustion engine,” said ACEA spokeswoman Sigrid de Vries. “The next step is to ensure the market introduction of new breakthrough technologies — and that is a significant step.”

The report from the EU’s environment watchdog, the European Environment Agency, showed the lowest average emissions from new cars sold in Denmark and Portugal, largely confirming a report in March.

Bulgaria, Denmark, Greece, Ireland, Latvia, Lithuania, Netherlands and Sweden recorded the largest annual reductions, of about 8 percent on average.

(Reporting by Pete Harrison, editing by Rex Merrifield)

The EU, home to 500 million people, has set a target for
cutting average emissions from new cars to 130 grams of CO2 per
kilometre by 2015.

Last year’s improvements bring the average emissions of new
cars to 140 grams, putting the EU on track to overachieve on a
target that was set in 2008 despite heavy lobbying from car
makers in Germany, France and Italy.

In 2009, car emissions fell 5.1 percent.

“These data show again that setting targets… stimulates
the car industry to put greener cars on the market,” said EU
climate commissioner Connie Hedegaard. “These innovations also
ensure Europe’s car industry remains competitive in the changing
global market.”

The weight of cars rose by 28 kg in 2010, after falling in
2009, a trend that environmentalists blamed on increasing
numbers of small sports utility vehicles (SUVs).

“That is no surprise,” said Arne Richters at transport
campaigners T&E. “EU rules favour heavier cars by allowing them
to emit more CO2. The EU should be favouring more efficient
saloons, estates and hatchbacks rather than encouraging
gas-guzzling, tall and heavy SUVs.”

Car industry group ACEA says cars with emissions below 120g
per km now have a 29 percent market share.

“Most of the progress so far has been achieved through
improved efficiency in the internal combustion engine,” said
ACEA spokeswoman Sigrid de Vries. “The next step is to ensure
the market introduction of new breakthrough technologies — and
that is a significant step.”

The report from the EU’s environment watchdog, the European
Environment Agency, showed the lowest average emissions from new
cars sold in Denmark and Portugal, largely confirming a report
in March.

Bulgaria, Denmark, Greece, Ireland, Latvia, Lithuania,
Netherlands and Sweden recorded the largest annual reductions,
of about 8 percent on average.

(Reporting by Pete Harrison, editing by Rex Merrifield)

“Following the ongoing re-assessment of nuclear plants in the EU, several neighboring countries will perform similar stress tests,” the European Commission said in a statement.

“Armenia, Croatia, Russia, Switzerland, Turkey, Ukraine and Belarus, agreed today that they will reassess their existing and planned nuclear power plants, using the stress tests developed by the EU as a reference,” it added.

Last month, European nuclear watchdogs agreed details of new safety checks on the region’s 143 reactors.

By June 1, regulators will have to start checking power plants’ resilience to earthquakes and tsunamis to avert any crisis like that at Japan’s stricken Fukushima plant, but terrorist scenarios will be left out.

The tests, which followed two months of dispute, also address the ability of reactors to withstand more common threats such as forest fires, transport accidents and the loss of electrical power supplies.

Thursday’s agreement with Europe’s six neighbors also includes a peer review, meaning that each national safety assessment will be checked by other countries’ experts, the Commission said.

“Nuclear safety is indivisible,” EU energy commissioner Guenther Oettinger said in a statement. “This is a huge joint step forward, for us, and for the neighbors on the European continent.”

Europe’s divisions over nuclear power have deepened since Fukushima, with Britain and France remaining steadfast supporters, Italy shelving plans to build new plants and Germany planning a 2022 phase-out.

While the EU stress tests will have no legal teeth, the details will be made public. That means any plant to fail will come under ever more intense pressure from the anti-nuclear lobby.

This could put particular pressure on plants without containment structures for reactors or fuel pools, or those that face seismic threats.

That could put the spotlight on Britain’s gas-cooled Magnox reactors, Russian-made units in Slovakia, Hungary and the Czech Republic, and old boiling-water reactors in Germany, Spain, Sweden and Finland.

(Reporting by Pete Harrison, editing by Rex Merrifield and Alison Birrane)