According to a new study by Bloomberg New Energy Finance, Europe’s already ambitious carbon reduction target of 20% by 2020 can be raised to 30% with a negligible raise in cost of .04% of GDP of EU countries.
And some member states would actually stand to get a net benefit from the raise.
The study was originally commissioned by the UK Department of Energy and Climate Change to see if raising the goal would actually damage the European economy.
It turns out that a 30% reduction in greenhouse gas emissions from 1990 levels would have very little impact. According to Guy Turner of Bloomberg New Energy and Finance, “Our analysis shows that increasing the 2020 target to 30% from the current 20% would result in an additional cost of 3.5 billion euros on average per year for the EU as a whole, from 2011 to 2020. This is equivalent to .03-.04% of EU GDP, or 7 to 9 euros per inhabitant per year. Clearly, a more ambitious policy would not be nearly as painful as some countries fear.”
Countries such as Belgium, Bulgaria, the Czech Republic, Estonia, Hungary, Lithuania, Poland, Slovakia and Slovenia all stand to gain from a move to the 30% target. These countries could sell their carbon allowances to other EU countries that are short of them. The surpluses would arise because its members will be able to take advantage of low-cost energy efficiency improvements. In fact, some of the aforementioned countries could see a boost of up to .05% of GDP.