The 2007 EU-U.S. Summit Statement on “Energy Security, Efficiency and Climate Change”: Missed Chances on Energy Security and Climate Change
By Sascha Müller-Kraenner

The EU-U.S. Summit on April 30 passed a seven page statement on energy security, efficiency, and climate change that is strong on rhetoric but weak on substance. The good news is that both sides have started talking about climate change. The bad news, however, is, that the summit declaration remains non-committal and contains few concrete policy initiatives.

European and U.S. leaders have missed three opportunities:

a. to capitalize on the high public anxiety both on climate change as well as on the energy security issue (a recent study published by the Bertelsmann Foundation shows that, next to international terrorism, energy security and climate change are the top concerns of citizens in both the U.S. and in European countries);
b. to link the debates on energy security and climate change in a meaningful way by showing ways to energy independence through renewable energies and more efficient technologies;
c. to integrate energy and climate policy in the framework for transatlantic economic integration, by coordinating technological standards, defining sustainability criteria and streamlining administrative procedures in the transatlantic energy market.

As expected, both sides continue to disagree on the merits of a global climate change regime. The post-Kyoto negotiations, which will begin at a UN climate conference at the end of this year in Bali, Indonesia, will take place without meaningful U.S. participation. For the first time, the U.S. administration has acknowledged the scientific work of the Intergovernmental Panel on Climate Change. The climate skeptics have finally lost the debate even in Washington; however, the transatlantic partners disagree on how to respond to the climate challenge. International initiatives therefore gained scant attention in the summit statement. The U.S. focus remains on technology cooperation rather than on international law and treaties. Two initiatives to coordinate transatlantic policies on emerging, potentially climate-friendly technologies were presented: one on second generation bio-fuels and the other on clean coal technology. Both leave fundamental questions open and offer a menu of well meaning wishes rather than concrete policy initiatives.

Both U.S. President Bush in his 2007 State of the Union address and European leaders in a recent summit meeting have announced ambitious goals to increase the share of bio-fuels significantly by the year 2020. New technologies such as the use of cellulosic ethanol, bio-butanol, and improved bio-diesel will be necessary to achieve those goals. However, clear and agreed sustainability criteria for the production and use of bio-fuels are essential if "bio-energy" should make a positive contribution to environmental quality and reduced greenhouse gases. Today's bio-fuels frequently need more fossil fuel input than they produce in "green energy" output. Traditional ethanol production from corn falls in this both economic and, from a climate perspective, absurd category. The main impulse behind the current policy to expand ethanol production from corn seems to be to shift agricultural subsidies from classical production subsidies to "green" policies.

Another problem is that energy crops are frequently planted under unsustainable conditions with heavy pesticide input and on former pristine or protected lands. Imported bio-fuel from the tropics has frequently been grown on area that was former rainforest or peat swamp. A major step to promote the sustainable production of bio-fuels would be to abolish import taxes for environmentally-friendly ethanol from Brazilian sugarcane. Both the European and U.S. farm lobby continue to advocate against that sensible measure.

Clean coal technology seems like a panacea to many problems the energy industry faces today. Business-as-usual scenarios foresee that China and India will massively expand the use of their domestic coal resources. Coal is also the most abundant domestic energy resource in the U.S. Clean coal technologies could mean progress in two crucial areas: first, by a massive improvement in air quality through modern filter technologies; secondly, by the separation of carbon emissions from the combustion of coal and their storage in geological formations or in the deep sea.

The main problem with clean coal is technological uncertainty. No one knows today whether the idea is technologically feasible and can be implemented at a reasonable cost. China and India clearly demand that any additional costs would have to be covered by international donors if they were to make the switch to cleaner technologies. Europe has proposed using World Bank funding for that purpose. However, the current conflict within the World Bank's leadership made it impossible to discuss such an initiative at the summit.

Considering the fundamental doubts about the future of bio-fuels and clean coal technology, it is surprising why a stronger emphasis was not given to the dissemination of existing and proven technologies in the areas of renewable energy and energy efficiency. It seems to be reckless to build the future energy and climate strategy of Europe and the U.S. on technologies that have not been proven yet.

Sascha Müller-Kraenner is the Director of the Europe program at the Nature Conservancy and is a frequent participant in AICGS events.

This essay appeared in the May 11, 2007, AICGS Advisor.