EU says saving planet must not cost the earth

By Paul Taylor and Ingrid Melander

BRUSSELS (Reuters) - European Union leaders pledged on Friday to agree laws within 12 months to implement their ambitious goals for combating climate change but promised to soften the blow for heavy industries.

A final statement at a two-day summit set a tight timetable for adopting mechanisms to curb greenhouse gas emissions and promote green energy sources but stressed they must be affordable at a time of economic downturn and market turmoil.

Concerns about slowing growth and financial instability prompted the 27 leaders to add the tell-tale phrase "so as to avoid excessive costs for member states" to the statement.

"We adopted the timeframe and the principles for the climate change and energy package," Slovenian Prime Minister Janez Jansa, whose country holds the EU presidency, told a news conference.

Failure to agree on the details by this time next year would weaken the bloc in United Nations talks on curbing emissions with other countries, including the United States, in Denmark in November 2009.

In a gesture to Germany, the European Commission pledged a binding commitment next year to make special allowance for energy-intensive industries if there is no global deal.

The 27 leaders pledged to enact laws by March 2009 to meet their goals of slashing greenhouse gas emissions by 20 percent by 2020 and increasing the share of wind, solar, hydro and wave power and biofuels in their energy mix by the same date.

They stressed the need to ensure that the high cost of carbon trading, the EU's central instrument in the fight against global warming, should not drive sectors like steel, cement, paper and aluminium out of Europe or out of business.