VZCZCXRO2367
RR RUEHIK
DE RUEHBS #1541/01 3221444
ZNR UUUUU ZZH
R 181444Z NOV 09 ZDK CTG NUMEROUS SVCS
FM USEU BRUSSELS
TO RUEHC/SECSTATE WASHDC
INFO RUEHZN/ENVIRONMENT SCIENCE AND TECHNOLOGY COLLECTIVE
RUCNMEM/EU MEMBER STATES COLLECTIVE

UNCLAS SECTION 01 OF 03 BRUSSELS 001541 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ECON EIND ENRG EWWT KGHG SENV TRGY
SUBJECT:  EU MEMBER STATES REMAIN DIVIDED DESPITE EU COUNCIL 
 
BRUSSELS 00001541  001.4 OF 003 
 
 
USEU would like to thank Embassy Stockholm for its reporting during 
the European Council. 
 
¶1. (SBU) Summary.  Although the European Council took several steps 
forward in defining its efforts to mitigate the effects of climate 
change, it failed to resolve several open issues, notably around 
financing.  Even among the agreed conclusions, it is apparent there 
remains disagreement among Member States as to their actual meaning. 
 The lack of agreement on at least two of the key open issues could 
impact the EU's flexibility in Copenhagen: 
 
   -- How the Member States will internally share the EU's financial 
burden.  The EU will create a Working Group to propose a solution, 
though the work is not likely to be completed in time for 
Copenhagen; 
 
   -- The EU's concrete financing contribution remains undefined. 
Lack of agreement on internal burden sharing could prevent the EU 
from bringing concrete numbers to Copenhagen; and 
 
   -- Eastern and Western Member States continue to disagree on how 
to address unused ssigned Amount Units (AAUs).  The EU only agree 
that the issue must be handled in a non-disciminatory manner, 
treating EU and non-EU partes equally.  End Summary. 
 
EU Further Defines Mitigation Targets 
------------------------------------ 
 
¶2. (SBU) The EU reiterated its ommitment to an agreement at 
Copenhagen that imits global temperature rise to two degrees 
elsius through reducing developed country emissions by 80-95% by 
2050 compared to 1990 levels and reducing global emissions by 50% by 
¶2050.  Specifically, the EU calls on developed countries to commit 
to ambitious emission reduction targets and advanced developing 
countries to commit to "appropriate mitigation actions, reflecting 
their common but differentiated responsibilities and respective 
capabilities." 
 
¶3. (SBU) For the first time, the EU presented its own 2050 objective 
to reduce emissions by 80-95% from 1990 levels.  The Council also 
restated that the EU will move from 20% to 30% reduction targets by 
2020, assuming comparable commitments from developed countries and 
adequate actions from developing countries.  However, comparability 
remains a significant gap in EU decision making, and a British 
official explained that ultimately, whether or not other countries' 
efforts are considered "comparable" will be a political decision 
made in Copenhagen. 
 
Financing remains almost completely unresolved 
--------------------------------------------- - 
 
¶4. (SBU) The Swedish Presidency quickly touted the Council as a 
success, noting that the EU put forth a target of 100 billions euros 
per year by 2020 for global financing, to come from a combination of 
public finance (in the range of 22 to 50 billion euros per year from 
all sources), an international carbon market, and self-financed 
efforts in developing countries.  However, key issues, including 
what financial amount the EU plans to contribute, how the EU Member 
States will internally share that financial burden, and according to 
an Italian official, even the 100 billion euro figure, remain open 
issues.  Prior to the Council, both Swedish and Danish 
representatives told USEU EconOffs that they wanted to come to 
agreement on all financing issues, particularly more clarity on what 
the EU will contribute, indicating the Council was not the success 
promoted by the Presidency. 
 
¶5. (SBU) Despite a strong push from the Presidency and several other 
Member States, including the United Kingdom and the Netherlands, the 
final Council was unable to secure agreement on concrete numbers for 
the EU's financial contribution to mitigating climate change in 
developing countries.  A British official told USEU EconOff that the 
repercussions from the failure of the Economic and Finance Ministers 
nt the week before wereh.  Poland and Hungary ln Member 
States opposication of financing numbees on how Member States wid 
financial burden.  pete numbers; a German@ff that Germany wants 
wait to see what other cUnited States, put on 
thhe lack of decision on Criven 
entirely by an @ernal burden sharing,e emissionle) as promoted by sevQ. 
Poland and the groQtes explained that furth heir already fragile econn 
agreed to set up aa proposal on how toQurden.  The results of 
 
BRUSSELS 00001541  002.4 OF 003 
 
 
must be agreed by a consensus of the Council, to ensure full 
agreement.  Embassy Stockholm reported by both Swedish PM Reinfeldt 
and Polish PM Tusk said that the EU will develop an internal 
mechanism that takes fully into account the ability to pay.  Poland 
has been pushing for heavy weighting on GDP, though a UK official 
told USEU EconOff that the UK is pushing for a 50/50 split between 
GHG emissions and GDP, with emissions given more weight over time. 
 
AAUs continue to be contentious 
------------------------------- 
 
¶7. (SBU) In addition to financing, the EU remained undecided on how 
to handle unused Assigned Amount Units (AAUs) from the Kyoto 
Protocol in any post-2012 efforts.  The EU has a unique situation 
with about half of its members owning large numbers of AAUs from 
substantial emissions reductions resulting from post-Soviet 
deindustrialization.  These Eastern Member States want to be able to 
continue to use their AAUs, but several Western Member States, 
notably the Swedish Presidency, are opposed, arguing that the 
environmental integrity of any deal will be compromised.  The issue 
is compounded as several EU Member States are concerned by the 
effect unused AAUs from Russia and Ukraine will have on a Copenhagen 
agreement.  The EU only could agree that the issue must be addressed 
in "a non-discriminatory manner treating European and non-European 
countries equally."  According to Council reporting from Embassy 
Stockholm, Polish Prime Minister Donald Tusk stated that unused AAUs 
are staying, unless there is global agreement on the symmetrical 
elimination of AAUs.  Several Member State representatives, both 
East and West, have explained that it is likely the AAUs will 
remain, but at a discounted rate. 
 
Lack of agreement may harm EU Copenhagen position 
--------------------------------------------- ---- 
 
¶8. (SBU) That the EU was unable to agree either on Copenhagen 
financing or internal financial burden sharing could put it in a 
difficult position entering Copenhagen.  Most Member States, 
including the EU Presidency, do not expect the Working Party to 
present its findings (or possibly even start its work) in advance of 
Copenhagen.  An Italian official told USEU EconOff that the EU may 
not be able to bring concrete financing numbers to Copenhagen with 
the burden sharing not agreed.  He explained that Poland would be 
unwilling to agree to EU financing if it did not already know its 
required contribution.  Instead, the official said that the 
financing discussion could move into 2010 in both the EU and the 
UN. 
 
¶9. (SBU) However, the "lack" of agreement could be part of a 
negotiating strategy.  Environment attaches from the Norwegian and 
Australian Missions to the EU had a different perspective on the 
Council's conclusions.  They heard that an informal agreement had 
been reached among the Member States to devise an equitable burden 
sharing arrangement on a finance package.  They also said that the 
EU would be prepared to discuss finance at Copenhagen, but for 
"strategic reasons" EU leaders did not want to publicize any figures 
or agreements on the subject.  A German official explained that 
Germany did not want to put forth any figures until it sees the 
potential contributions by other parties. 
 
Member States disagree on how to interpret Conclusions 
--------------------------------------------- --------- 
 
¶10. (SBU) Even with agreement by the 27 Heads of State and 
Government, EU Member State representatives have displayed 
inconsistency iuncil ompleted in time for Copenhagen, but it appears that there 
is overwhelming opposition from other Mmber States to do so, with 
Embassy Stockholm eporting that Swedish PM Reinfeldt said that thQ 
Working Party will be established after C/penhagen. 
 
¶11. (SBU) Comment.  The results of he Council struck a blow to the 
EU's efforts to head to Copenhagen with a strong mandate. 
Troughout 2009, the EU and the Swedish PresidencQ have argued that 
the EU would bring concrQte positions to the negotiations after the 
October Council.  However, inability to agree to soe of the key 
financing and AAU discussions has left the EU in a more difficult 
position.  Environment Ministers will meet informally on November 
23, and there looks to be an extraordinary EU Council prior to 
 
BRUSSELS 00001541  003.4 OF 003 
 
 
Copenhagen, but neither of these meetings is expected to provide any 
further clarity to financing.  Several Member States, notably 
Germany, are waiting to see how other countries act in Copenhagen. 
However, if others move ahead of the EU, particularly on financing, 
it has the potential to put the EU further on the defensive; the 
Council was strongly attacked for its failure to provide clarity. 
The EU is looking to maintain a leadership role, but there was clear 
concern regarding the EU's position among some Member State 
officials when discussing the results of the Council.  End comment. 
 
MURRAY