Britain attacks EU partners over pollution

UK Government rounds on France, Spain and Italy for not enforcing rules to reduce carbon emissions. Clayton Hirst reports

Patricia Hewitt has accused France, Spain and Italy of wriggling out of new European rules designed to reduce carbon emissions, in a move that could damage British industry.

Patricia Hewitt has accused France, Spain and Italy of wriggling out of new European rules designed to reduce carbon emissions, in a move that could damage British industry.

The Secretary of State for Trade and Industry believes that the three countries have failed to sign up properly to the EU Emissions Trading Scheme, which begins in January. This will create a European environmental market, where "green" companies are awarded credits which can be traded with industries that produce large volumes of carbon dioxide.

A new report produced by environmental consultancy Ecofys and commissioned by the Department of Trade and Industry reveals that trading systems in some countries will allow companies to pollute without a large penalty.

"The UK believes that the very narrow scope used in France, Spain and possibly Italy is inconsistent with the Emissions Trading Directive and would create a damaging competitive distortion between EU countries," said the DTI in response to the report. It said that the chemicals, automotive and manufacturing sectors could be particularly affected by the distortion.

With the fresh evidence that some countries have not properly signed up to the scheme, Tony Blair is expected to take up the issue with the European Commission. In July the Prime Minister delivered a letter to outgoing Commission president Romano Prodi, urging him to police the introduction of the trading scheme. Also signed by Ms Hewitt and Environment Secretary Margaret Beckett, the letter said there was a need to "avoid severe competitive distortions from inconsistent implementation of the directive".

The letter concluded: "We have all invested significant political capital in the scheme: we need to go the extra kilometre to make sure it will be a success."

A spokesman for the Department for Environment Food and Rural Affairs confirmed that ministers would continue to lobby on the issue, singling out France, Spain and Italy for special scrutiny. The UK has set itself some of the toughest emissions targets in Europe. In particular, it wants a 20 per cent reduction in carbon dioxide pollution by 2010 - far exceeding the commitments under the Kyoto protocol.

But industry is concerned that its tough stance on pollution has left Britain out on a limb, making it more expensive to do business.

Jeremy Nicholson, director of the Energy Intensive Users Group, which represents the steel, chemical, glass and paper industries, said: "The UK Government is taking a stance [on the environment] in the hope that others will follow. But in doing so it is leaving our industry stranded. Industry feels let down by the Government in its attitude to emissions reduction."

However, Mr Nicholson added that the problem is exacerbated by other European countries' lax attitude to reducing pollution.

"Some countries are not honouring the letter or the spirit of the European emissions trading scheme," he said.