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Greater greenhouse gas reduction to bring major savings

If the EU and consequently Hungary decided to reduce harmful emission by 30% instead of the currently accepted 20% by 2020, major economic advantages could be achieved for comparatively small additional costs, a study commissioned by the Greenpeace environmentalist group shows.

According to the research conducted by the Ecofys institute, the economic crisis has already had a great and positive impact on the volume of harmful emission in the EU thanks to the drop in industrial production. As such, the community’s 20% greenhouse gas reduction goal by 2020 from the 2005 benchmark is not only realistic, it will almost certainly be reached at lower expense than earlier estimated. Consequently, the EU should now begin to seriously consider the other, more ambitious scenario, in which emissions are reduced by 30% by the same date, said Barbara Stoll, Greenpeace Hungary’s campaign chief for climate and energy.

Estimates show that the overall costs of reaching the 20% goal have been reduced to €48 billion from the initially calculated €70 billion laid out before the crisis. Now, an additional €11 billion bringing the total to €81 billion would suffice to up the figure to 30%.

“This investment would generate total savings of €2.5 billion for Hungary by 2020,” said Joris Koornreef, one of the authors of the study. Although the 20% target would have produced somewhat bigger savings of €2.6 billion, but given that the bigger emission cut is still in the positive cost-wise and its effect in the climate change effort is much bigger, it is a better choice, he added.

Ecofys also believes that a 30% commitment would produce a 10% rise in employment, mostly in the construction sector. The figure is an aggregate derived from the notable rise in building-industry employment from residential and industrial retrofitting efforts that offset a lapse in other sectors, like mining or electricity and gas utility services.

However, as Koornreef noted when asked by the BBJ, the model is only adequate in this respect to prove a mathematical output. It does not take into consideration outcomes, like gas workers not being able to automatically switch to the construction industry which is set to have higher workforce demand. The calculations also excluded the rise in welfare spending resultant of heightened unemployment in the adversely affected sectors.

Stoll told reporters that the study has also been sent to Péter Olajos deputy state secretary in charge of climate matters. The timing of the study deliberately corresponds with Hungary’s EU presidency given the country’s exceptional position to shape the European agenda in the first six month of 2011, Stoll added. (Gergő Rácz)