EU warned by advisers not to weaken new climate goal

By Kate Abnett

BRUSSELS (Reuters) -The European Union's independent advisers have warned against watering down the bloc's planned 2040 climate goal, as EU officials consider softening the target to try to contain a political backlash against ambitious environmental policies.

The European Commission plans to propose in July a legally binding target to cut EU countries' emissions by 90% by 2040, from 1990 levels. But faced with pushback from governments, Brussels is assessing options including setting a lower target for domestic industries, and using international carbon credits to make up the gap to 90%.

The EU's climate science advisers, the European Scientific Advisory Board on Climate Change (ESABCC), warned against this approach, which they said risked diverting funds away from investments in European industries and infrastructure.

"Using international carbon credits to meet this target, even partially, could undermine domestic value creation by diverting resources from the necessary transformation of the EU's economy," the ESABCC said, in an analysis of the 2040 target, published on Monday.

A Commission spokesperson did not immediately respond to a request for comment.

Counting carbon credits would mean EU countries could buy credits from projects that reduce CO2 emissions abroad - for example, forest restoration in Brazil - and count them towards the EU goal.

Proponents say these credits are a crucial way to raise funds for CO2-cutting projects in developing nations. But some EU officials are wary. The EU banned international credits from its carbon market in 2013, after a flood of cheap credits with weak environmental benefits contributed to a carbon price crash.

Despite geopolitical headwinds, looming U.S. tariffs and high energy prices, the ESABCC said it was sticking to its recommendation from 2023, that the EU agree to a 90-95% net reduction in greenhouse gas emissions for 2040 - which, it said, is achievable and in line with global goals to avert worse climate change.

This would require a nearly entirely emissions-free power sector by 2040 and a shift to electrify polluting industries.

The advisers said this would bring benefits including less pollution-related health problems, driving investments to modernise industries, and improving security by reducing Europe's reliance on imported fossil fuels.

(Reporting by Kate Abnett; Editing by Kirsten Donovan)