Last-minute energy package changes amid fierce lobbying

The energy package was the fruit of months of arcane policy work, lots of number-crunching and intense lobbying from member states, industry and green groups.

The EU’s target is to reduce emissions by 20% from 1990 levels, by 2020. Of the 20%, 6% has already been achieved.

To arrive at the burden-sharing targets - "effort-sharing" in Commission parlance - the Commission divided the remaining 14% between the 27 member states, skewing the burden towards older, richer member states. The UK, France and Germany must cut their emissions by 16%, 14% and 14% respectively by 2020, while Romania and Bulgaria can increase carbon emissions by 19% and 20% until 2020.

A similar logic was applied to the renewables targets. The EU has a shared target to get 20% of its energy from renewables by 2020, with 10% of transport fuels to come from biofuels. The EU already gets 8.5% of its energy needs from renewables, the remaining 11.5% will be divided between countries.

Member states lobbied hard to shape this directive. First, the eco-conscious early adopters, such as the Nordic countries, did not want their efforts overlooked, thus ‘rewarding’ renewable laggards such as the UK.

Second, some member states were worried about a proposal for trading renewables. Germany and Spain had protested that plans to trade renewables certificates could undermine their domestic feed-in tariffs, which have been behind the boom in renewable energies in those countries. The Commission’s environment department bowed to these concerns and has proposed a voluntary scheme. A senior Commission official said that this would make the scheme more expensive."By restricting trade we are opting for producing a more expensive system," the official said.

The most dramatic change for the Emissions Trading Scheme (ETS) is the move to full auctioning for power companies. The Commission wants to show that it has learnt some lessons from the first round of the ETS (2005-07) when the price of carbon collapsed after too many permits were given away for free.

After heavy lobbying from industry, some energy-intensive industries (probably cement, chemicals and steel) will get a proportion of free permits: around 40% of permits will be free in 2013, but this will decrease over the years.

A French-inspired idea of a tax on carbon-heavy imports was not proposed, but is still under consideration, along with other measures to ensure equal competition between European and non-European countries. Commission President José Manuel Barroso said: "We are not seeking to introduce protectionist measures…if they [third countries] think the measures are protectionist, please join us."

The energy package was the fruit of months of arcane policy work, lots of number-crunching and intense lobbying from member states, industry and green groups.