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EU climate talks head into overtime as countries scrap over funds

EU climate talks head into overtime as countries scrap over funds
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By Reuters
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By Kate Abnett

LUXEMBOURG -EU countries struggled on Tuesday to agree on new legislation to help combat climate change, with disagreements centred around a fund to help poorer citizens cope with CO2 costs and on how strict to make a 2035 phaseout of new fossil fuel cars.

Environment ministers from the European Union's 27 member states were meeting in Luxembourg to negotiate their joint positions on more ambitious laws to reduce planet-warming emissions this decade and require countries to step up efforts to make energy, industry and transport greener.

Agreement remained elusive on Tuesday evening, with talks still stuck over a fund to shield poorer households from CO2 costs under a new EU carbon market.

"I'm not sure if 8pm is the right time to start getting more difficult and to harden our positions," Spanish environment minister Teresa Ribera said, after other countries rejected compromise proposals and sought changes to the texts.

A proposal to fix the size of the fund at 59 billion euros, drafted by France which was chairing the meeting, was opposed by Latvia as too small, while Germany, Finland and Denmark - wealthier countries who would pay more into the fund than they would get back - said it was too big.

"No particular progress has been made since the morning," Dutch climate minister Rob Jetten said.

COST CONCERNS

The European Commisison had proposed the fund to accompany a new EU carbon market that will impose CO2 costs on polluting fuels used in transport and buildings from 2026. Its aim was to address the concerns of poorer eastern countries such as Poland and Romania, which fear the CO2 market could inflate citizens' energy bills.

Ministers also locked horns over reforms to the EU's current carbon market, which forces power plants and factories to pay when they pollute. Countries including the Czech Republic called for rules making it easier to intervene in the market if CO2 prices jump, and Poland said a compromise proposal looked like it was "designed not to work".

The raft of new laws is designed to deliver the EU's 2030 target of reducing net emissions by 55% from 1990 levels. The proposals that win ministers' majority support will form their position for upcoming talks with the EU Parliament on the final laws.

Countries did appear to be edging towards support for an EU plan to effectively ban new combustion engine car sales from 2035, which would require cars sold from this date to emit zero CO2. Italy, Portugal, Slovakia, Bulgaria and Romania had pushed to delay that to 2040.

Germany, the EU's biggest car market, mooted a compromise on Tuesday that kept the 2035 target but said cars able to run on renewable fuels could continue to be sold after 2035, prompting some confusion about what that would mean for Europe's automakers.

"We are all for compromises... but compromises that have, as a result, non-intelligible statements are more difficult to accept," said Portuguese secretary of state for energy Joao Galamba.

($1 = 0.9454 euros)

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