Financial Times

By Raphael Minder and George Parker

September 21, 2005

Controversial plans to improve Europe's air quality have been diluted by the European Commission following protests from industry, reducing projected annual compliance costs from ?12bn to ?7.1bn.

The proposal, expected to be approved by the EU executive today, aims to reduce the number of premature deaths caused by pollution in the EU from 370,000 a year to 225,000 by 2020. It would introduce tougher controls on particulate matter, or fine dust, which accounts for most premature deaths. But it would introduce less stringent emission ceilings for air pollutants such as nitrogen oxide, sulphur dioxide and ammonia than had been envisaged before the summer.

While recognising a "change in the level of ambition", Stavros Dimas, the European Union's environment commissioner, argued that the proposal was testimony to Brussels' determination to stick to an ambitious environmental agenda.

Following last July's meeting of the Group of Eight leading industrial nations in Gleneagles, which was largely devoted to climate change, the EU is also keen to maintain its profile as the main force behind the Kyoto protocol and initiatives to lower pollution levels.

Mr Dimas said: "Whatever way you look at it, the benefits of clean air far outweigh the costs. Nobody is immune from air pollution and I am sure that industrialists, who also breathe the same air, must be pleased."

Air pollution is one of seven areas seen as a credibility test for Mr Dimas, a former Wall Street lawyer whose appointment was greeted with scepticism by environmental groups. Separately, Mr Dimas is also preparing to tackle the environmental impact of the aviation sector with a proposal to include aviation in the EU's carbon dioxide emissions trading scheme.

This proposal is due to be tabled next week and could also prove controversial, notably because Mr Dimas is leaving open the issue of how it will apply to airlines that fly out of the EU.

However, Mr Dimas expects airlines to give at least lukewarm backing to his proposal as the lesser of possible evils, compared with the idea of a kerosene tax or a user charge.

Taking as an example prime minister Tony Blair's forecast that 25 per cent of British emissions will come from aviation by 2025, Mr Dimas argued that, if Brussels did not move ahead, governments would eventually impose alternative restrictions on airlines.

"Airlines know they will eventually have to make some sort of environmental contribution and it appears that this [emissions trading scheme] is the most acceptable alternative for them."

Concerning plans to overhaul the European chemical sector, Mr Dimas said he was confident that the legislation, known as Reach, would gain preliminary approval from the European parliament and EU member states by the end of the year.

He welcomed the latest revisions tabled by the UK, which holds the EU's rotating presidency.