Europe to Ask Wealthy Nations to Adopt Carbon Trading System

By JAMES KANTER

BRUSSELS — The European Commission was preparing an appeal on Friday to wealthy countries — and to the United States in particular — to adopt carbon trading as one of the main mechanisms for curbing greenhouse gas emissions.

The Europeans are drafting their proposal as the United States enters a period of intense debate over the wisdom of adopting such market-based systems following the inauguration of President Obama.

Mr. Obama endorsed a similar system to cap and trade carbon dioxide, the main greenhouse gas, during his election campaign. That system sets a limit on emissions, and those who exceed it must buy or trade permits to meet it.

The main alternative to a cap-and-trade system is a tax on emissions. Many analysts say that would be a more straightforward way of limiting planet-warming gases from industry.

So far, Europe has created the largest single market for trading permits to emit carbon dioxide, while Australia and some groups of American states have begun their own initiatives. But the European system has also come under fire for doing too little to stop pollution and for creating vast windfall profits for some industries, like coal-burning utilities.

European officials have acknowledged that the European Union’s emissions trading system has had a rocky start. But they say it has become more effective following a pilot phase, which ran from 2005 to 2007.

European Union governments approved further measures late last year aimed at reducing the scope for lobbying by governments and industry that diluted the effectiveness of the system during the pilot phase.

The commission’s proposals could still change before they are officially presented Wednesday by Stavros Dimas, the European Union environment commissioner. They are meant to lay out Europe’s stance as nations prepare for international talks in December in Copenhagen to negotiate a successor agreement to the Kyoto climate treaty.

A centerpiece of the commission’s proposals is “strategic bilateral partnerships” with the United States “to create a trans-Atlantic carbon market,” according to the proposals, seen on Friday by The New York Times.

The proposals also seek to encourage the participation of developing nations by helping them finance ways to adapt to climate change and cut emissions.

In the past, efforts at reaching global, coordinated action on climate change have been undermined in large part because the United States insisted on binding emissions limits for countries like India and China. Those countries resisted mandatory rules, saying they had the right to industrialize and improve their citizens’ standards of living.

Some of the businesses that regard emissions regulation favorably because it could promote new investment opportunities welcomed the latest proposals.

Adam Nathan, a spokesman for the Carbon Markets and Investors Association, a trade group, praised the central role for the carbon market set out by the commission. But he warned that support from the United States and others would be critical.

“Cooperation with the Obama administration must focus on leveraging comparable action from the United States and supporting developing countries in their efforts,” he said.

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