KEY POINTS:
PARIS - The European Union faces a mighty challenge this week to its status as would-be saviour of the world's climate system.
At a summit on Friday and Saturday, the 27-nation bloc must overcome a rift over how to achieve the world's most ambitious target for curbing greenhouse-gas
emissions.
Anything other than a solid deal could have repercussions that would rumble far beyond Europe, say observers.
The summit in Brussels coincides with the climax of a 12-day meeting in Poznan, Poland, tasked with advancing to a new worldwide treaty on climate change under the United Nations umbrella.
The EU has championed this multilateral effort since 2001, when the United States abandoned the Kyoto Protocol, the historic UN pact for cutting carbon emissions.
Europe is now driving the goal to forge a more ambitious successor to Kyoto, scheduled to be completed in December 2009. So any fudge or bustup in Brussels could cripple these efforts just when they need momentum, say sources.
"What happens in Poznan at the end of this week will be a lot less important than what happens in Brussels," said a delegate with the European Commission attending the UN talks in Poznan.
"I don't even want to think about what will happen [to the UN climate forum] if they don't get a deal over there."
Another delegate said, more optimistically, that the EU could send a strong signal to Poznan by showing it could overcome entrenched problems.
"It would certainly change the general mood," said the source.
Last year, EU leaders threw down the gauntlet, declaring they would unilaterally curb their greenhouse-gas emissions by 20 per cent by 2020 compared with 1990 levels.
They offered to deepen this to 30 per cent if any other big advanced economy followed suit.
No other player has taken up the offer, and indeed most countries have yet to identify any emissions target for the medium term.
President-elect Barack Obama says he wants to return US emissions to 1990 levels by 2020.
The EU also set a goal of a 20 per cent increase in energy efficiency and giving clean renewables a 20 per cent share of the EU's power market by 2020. At present, renewables have a stake of only about 8.5 per cent.
Having vision is one thing but realising it is another - and more and more problems have emerged as the economic horizon has darkened in the past two months.
France, current EU president, is struggling to get Poland and Italy to drop threats to veto the package.
Poland is objecting to proposals setting down auctions in carbon dioxide quotas from 2013.
The country derives 94 per cent of its electricity from coal, the dirtiest fossil fuel. It argues that by setting a date that is just five years hence, its power producers will have to pay a fortune in so-called "pollution permits".
French President Nicolas Sarkozy flew to Gdansk yesterday for a working lunch with Polish leaders and the heads of other East European states who share Poland's concerns.
"I have good hopes that we'll get there, even though there is still ground to be covered," said Sarkozy. "We are in full negotiations, balances have to be found."
"We are close to the goal but we still have to sort out several points," said Polish Prime Minister Donald Tusk, who referred, without elaborating, to securing an "exemption" until 2019.
Sarkozy's other big headache is Italian Prime Minister Silvio Berlusconi, who is talking of nixing the package because of the cost to Italian businesses. And the French leader also has to deal with German Chancellor Angela Merkel, with whom he already has a notoriously tense relationship.
Merkel was previously a big supporter of the 2020 scheme but is now calling for most emissions allowances to be free for industry to help ease German corporate burdens.
Demands by Germany's carmakers have already caused the EU to water down its proposals for reducing carbon emissions from the road transport sector.
Green groups are dismayed at the rush to concessions.
"It is a disgrace that, just at a time when the rest of the world, including the US and China, is waking up and starting to act against climate change, the EU's leadership is melting away," Greenpeace, WWF and Friends of the Earth said last week in a joint statement.
Diplomats say the haggle is spiced by a race against time.
Sarkozy is desperate to stitch up a deal by the end of his EU presidency. This is not simply for reasons of ego, but also because France will hand the baton to the Czech Republic, whose president, Vaclav Klaus, is both a euro-sceptic and a climate-sceptic.
If the package is not sealed by December 31, it could well unravel under the Czech presidency, according to this argument.
"The night of December 11 will probably be very long," a French diplomat said in weary expectation.
