by Nick Mabey and me. Posted by Copenhagen, Independent blog, via Stop Warming, on 9 December 2009.

China and the United States have now put their opening bids for Copenhagen on the table. The US is offering a 17% reduction on its 2005 emissions subject to the passage of climate legislation by the Congress. China is offering a 45% reduction in the carbon intensity of its economy by 2020. While both are significant advances on their previous positions, neither is good enough to set the world on course to limit the rise in temperature below the two degree threshold of dangerous climate change. As a result, there is a serious risk that when President Obama and other world leaders come together in Copenhagen next week they will end up sealing a weak deal that falls short of Europe’s objectives and undermines momentum for global action.

This climate leadership vacuum presents European leaders with an exceptional opportunity as they gather for this week’s Summit in Brussels. On no other issue is it so clear that Brussels can deliver more for Europe’s citizens than could possibly be delivered from any one of its capitals. Even in Euro-sceptic Britain polls show that most people want action on the climate to be European in scale.

Europe has led the global drive to tackle climate change from the beginning. British diplomacy was instrumental in securing US participation in the first climate treaty in 1992. Initiatives launched in Europe transformed the global debate on climate science in 2005, on its economics in 2007 and on financing the necessary transformation in 2009. The EU’s unilateral commitment to reduce its own emissions by 20% by 2020, to increase its energy efficiency by 20% by the same date and to derive 20% of its energy from renewables set a clear benchmark for serious intent by the industrialised countries responsible for most of today’s carbon burden.

But it is the promise to go further and cut its emissions by 30% if a deal is done in Copenhagen that creates an exceptional opportunity. The world has changed profoundly since this commitment was first made. China is now investing heavily in low carbon technologies. The new Japanese government has promised a 25% reduction. Brazil has put 39% on the table and other economies are taking actions on climate that seemed out of reach two years ago. All but one country in the EU is now on target to meet its Kyoto commitments.

Furthermore, emissions have fallen so far as a result of the recession that the EU-27 is already half way towards achieving the 20% target. This could weaken the impact of the EU Emissions Trading System by creating an over-supply of permits and a weak carbon price. The UK’s Independent Climate Change Committee has slashed its forecast of the carbon price in 2020 to €22 per tonne, down from €56 per tonne in December 2008. Power companies and industries covered by the EU ETS have already accumulated surplus allowances which could lead to additional windfall profits for industry of €5.4 billion by 2013.

This presents two big problems. First, without a strong incentive to deploy clean, efficient technologies Europe risks being left behind in the race to create the low carbon industries of the future. Investment in renewable energy and electric cars is growing rapidly in China and elsewhere, with governments playing a strong role through regulation, concessional financing, carbon taxes and other policy instruments. To keep pace with these countries Europe needs a stronger and more reliable carbon price signal from the ETS.

The second problem is larger European budget deficits. From 2013 a growing number of companies covered by the ETS must purchase their allowances rather than receiving them for free. A fall in the carbon price from €40 to €20 will lower the amount of action revenue available to governments from 2012 onwards, with losses reaching €20 billion per year by 2020.

The EU should seize the moment and raise its unilateral emissions reduction target to 30% immediately. Because of the recession, a 30% target would cost substantially less now than 20% was expected to cost in 2008. Failing to move to a 30% trajectory will allow another generation of polluting infrastructure to be built as Europe emerges from recessions; investment which will be costly to remove as Europe moves to a zero carbon energy system in 2050.

A unilateral move to 30% reductions is in the EU’s domestic interest. But the EU should also commit to move to 40% as part of a fair, ambitious and binding global deal. This would boost confidence in the international carbon market and incentivise the investment needed to drive transformational change in the power, industry and transportation sectors. It could also be the key to unlocking the more ambitious moves needed from the US, China and other major economies if we are to achieve a two degrees deal at Copenhagen.

The last few years has seen many ask the question of what Europe is for in the 21st Century? The most pressing problems we face, from global terrorism to mass migrations, from organised crime to failing states, from pandemics to climate change all have one feature in common: no nation can solve them by acting on its own. The EU is the world’s largest, most sustained and successful example of the triumph of cooperation over rivalry. Seizing the opportunity to make a bold move to restore momentum towards a meaningful Copenhagen agreement that would provide climate security for world – including 450 million Europeans – would be a fitting answer to that question.