PM hails EU climate fund 'breakthrough'

Europe to propose £90bn support package ahead of key Copenhagen talks

Europe's leaders will present a £90bn plan to cut the world's greenhouse gas emissions at the United Nations climate change summit in Copenhagen. After hours of wrangling at the EU summit in Brussels this week, they gave broad backing to Gordon Brown's calls for developed nations to put a price on tackling global warming.

The Prime Minister, who had warned that a failure to set out detailed figures would jeopardise the Copenhagen talks in December, hailed yesterday's agreement as a "breakthrough".

The EU will push for the world to agree a €100bn (£90bn) support package for developing countries trying to cope with the impact of climate change.

Under the plan, developed nations would pump between €22bn and €50bn a year into the fund by 2020, which is expected to include an overall EU contribution of €7bn to €10bn. The Prime Minister has already committed Britain to put £1bn into the fund.

The EU said its proposal was a "conditional offer" that depended on other countries backing the plan with their own money. The rest of the €100bn package, to be phased in from 2013, would come from the global emissions trading scheme as well as some contributions from wealthier developing nations such as China, Brazil and Mexico.

Mr Brown overcame opposition from several EU leaders to agree the deal in Brussels. He was forced to compromise on details of the plan, but the united European face to be presented at Copenhagen will put pressure on the US, Russia and other developed nations to agree a wide-ranging deal.

Mr Brown had originally pressed for the EU to support a worldwide contribution of €30bn to €40bn, but German Chancellor Angela Merkel, backed by the French, had resisted committing the EU to such a specific figure in advance of Copenhagen. In order to get her on board, the leaders agreed the wider €22bn to €50bn range, although British officials acknowledged a contribution as low as €22bn would make it difficult for the overall sums to add up.

Nine eastern and central European nations, led by Poland, protested at the size of the figures, arguing they already faced a big bill to reduce the emissions from their own Soviet-era heavy industries. Although the Brussels talks did not get into the detail of individual countries' payments into the fund, the former Iron Curtain countries won a private agreement that they would not be expected to contribute large sums.

In addition, the EU will propose creating a fund of £5bn to £7bn to help the developing world cope with climate change between 2010 and 2012, for which Britain already has £800m earmarked.

The EU has already promised to cut its emissions by 20 per cent by 2020, compared with 1990 levels, and has said it would aim for a 30 per cent reduction if other parts of the world follow suit.

Europe's leaders will also challenge the rest of the world at the Copenhagen summit to offer a reduction of between 80 and 95 per cent by the year 2050.

Mr Brown said: "This is a breakthrough that takes us forward to Copenhagen and makes a Copenhagen agreement possible. Now we want other countries to respond to what we're doing. I think developing countries can now say they are ready to cut their emissions substantially over the next few years."

The deal came after Ban Ki-moon, the UN secretary general, urged EU leaders to "provide the political leadership to achieve a breakthrough on climate financing". He told them a Copenhagen deal was unlikely without a "credible package on financing to support mitigation and adaptation in developing countries".

But Oxfam claimed the European offer was not large enough and warned there was no guarantee the money on the table would be "new" or diverted from existing aid commitments.

The EU deal: A step on the road to Copenhagen

What has been agreed?

*The EU has reached a conditional deal on how much it will pay to help other countries fight global warming, ahead of a major UN climate conference in Copenhagen in December.

*The fight against climate change would require €100bn (£90bn) a year by 2020, and that EU countries should contribute up to €50bn (£45bn), provided other nations meet the rest of the cost.

*If the offer is accepted at Copenhagen, the UK share of the EU contribution will work out at about £1bn a year.

*The contributions of other EU countries will depend on the size of their populations. Germany has 20 million more people than the UK and is expected to pay about £1.5bn, while France will pay £1bn as the size of its population is similar to ours. However, this rule will not apply to poorer eastern European countries, such as Poland, which will be asked to pay less.

What happens next?

*The next round of climate change discussions will take place in Barcelona next week. Thousands of delegates from 175 countries will meet to discuss how best to share out reductions in greenhouse gases, and how much money can be raised to help poorer countries tackle global warming.

*Delegates from 192 countries will then hold two weeks of talks in Copenhagen's swish Bella Centre, beginning on 7 December. The ultimate aim is to establish a new global treaty on climate change to replace the Kyoto Protocol, which expires in 2012.

*Four essential topics will need to be resolved: how far developed countries are willing to reduce their emissions; how far developing nations like China and India are willing to limit the growth of their emissions; how those countries are going to be helped financially to achieve this; and how that money will be managed.