March 19, 2009

European Union plans to re-write the rules of a $6 billion scheme that pays developing nations to cut greenhouse gas emissions risks stalling climate investment, policymakers and industry leaders said on Wednesday.The EU's executive Commission this week detailed plans to force industry in advanced emerging economies such as China to meet efficiency or other standards before they qualify for carbon offsets from cutting carbon emissions.Commission officials want the new rules agreed at a major U.N.-led climate meeting this December in Copenhagen, meant to thrash out a new climate treaty to replace the Kyoto Protocol.

"We should agree by the end of this year the basic architecture," EU Commission official Peter Zapfel said on Wednesday."We're talking about a mechanism we want up and running by 2013," he added, speaking at a carbon market conference also held in Copenhagen.That tight timetable and lack of any clear rules worried investors, especially given that December's climate meeting already faces huge challenges to get 190 countries to agree ambitious action to fight climate change."I must admit I'm starting to get frightened about the Copenhagen meeting," said Nick Campbell, chair of the climate working group at Europe's biggest business lobby group BusinessEurope.