Coal subsidies divide rich countries

RICH nations are divided ahead of talks in Paris on Thursday to seek a deal to phase out coal subsidies in a foretaste of the difficulty of agreeing on action to curb global warming at a UN summit later this year.

France, host of the UN climate summit, has piled on the political pressure to restrict a type of subsidy that helps nations export technology for power generation from coal.

Two days after confirmation of EU regulatory approval for US firm General Electric’s takeover of Alstom, France’s big manufacturer of coal plant technology, French Environment Minister Ségolène Royal said the government would scrap coal export credits.

The Organisation for Economic Co-operation and Development (OECD) has been trying to broker a phase-out for more than a year and holds new talks on Thursday.

It has said it wants an agreement this month, but EU sources say it may have to arrange more talks and time is running out. “It’s a total standoff,” one source said on condition of anonymity.

The problems in solving the coal export financing issue highlight the difficulty of brokering a wider deal at UN talks in Paris starting on November 30. Even Germany, which led Group of Seven calls for a tough stance on climate change, is heeding industry pressure to maintain support for coal.

Representing the biggest bloc within the 34-member OECD, EU officials have been seeking to agree on a compromise EU position to galvanise the talks. – Reuters