Investing in our future: A European budget for climate security Russell Marsh Head of Policy – Green Alliance

Climate change: how much is stake? EU role in rising prosperity and security Climate change threatens both –Profound economic, social, security, and development implications –no region immune from economic impacts –will exacerbate inequalities within Europe

Where is Europe on climate change? Key progressive player globally Growing urgency among EU leaders in EU 2007 Spring Council (20, 20, 20) But… Poor record in cutting actual EU emissions No integration yet of either internal or external policy A step change in delivery required

Does the EU budget matter? Stern principles for global policy framework: –carbon pricing; –technology; – and behaviour change. Spending an element within all three. Early public investment critical to an effective transition to a low carbon economy EU action can deliver where national action cannot.

3 principles for future EU climate spending Focus limited funds where they make the greatest impact. Address the global and regional inequalities of climate change. Set the standard for global action. To deliver within and beyond Europe.

Impact of current EU budget Cohesion and structural funds. Common Agricultural Policy. Research and development. Contributes to increased EU emissions, and locks in EU countries to carbon intensive patterns of transport and economic activity.

Five priorities for EU spending (1) A new dedicated low-carbon fund for energy and transport infrastructure development, with climate proofing of all EU cohesion spending. Finance first phase of carbon capture and storage plants.

Five priorities for EU spending (2) Increase R&D funding to bring breakthrough technologies to market. Support development of low-carbon infrastructure in emerging economies through a sovereign investment fund. Meets 50% of EU’s fair share of the cost of adaptation for the poorest countries.

How should this be funded? Reform of current budget (CAP & cohesion funds). or Use of revenues from auctioning of power sector allowances in the third phase of the ETS post It’s a political choice.

Conclusion “Invest to save”. Early reform will pay greatest dividends. Can we afford to wait until 2013? Public support: economic, social, environmental and political benefits of a budget focused on climate change.