Latvia contests its EU carbon emissions quota

(RIGA) - Latvia is to legally challenge a European Union decision to slash its 2008-2012 carbon dioxide emissions quota as unfair, a minister said Tuesday.

Environment Minister Raimonds Vejonis told the Baltic News Service (BNS) agency that Riga was unhappy with the way Brussels had calculated its cap on emissions of one of the main gases held responsible for global climate change.

Riga wants the European Court to overrule the decision by the European Commission, the EU's executive arm, to allocate it an annual carbon dioxide emissions quota of 3.43 million tonnes.

Latvian authorities had sought a quota of 6.25 million tonnes.

Riga has expressed particular concern that the EU requirements would put the brakes on its energy and construction sectors. The allocations affect the metallurgy, oil refining and power segments which have high energy consumption levels and are responsible for nearly half of EU carbon dioxide emissions.

The commission is responsible for approving national governments' bids for carbon dioxide allocations as part of the 27-member EU's drive to curb emissions under the Kyoto Protocol.

Three weeks ago, Latvia's neighbour Estonia also decided to file a lawsuit over its emissions quota. Poland, the Czech Republic and Slovakia have likewise launched legal challenges.

The EU's ex-communist member states have been working to overcome a legacy of slack environmental standards and several have made major strides over the past decade.

However, they are concerned that a big clampdown on emissions will hamper their industries' efforts to bridge the economic gap with the older western members of the EU.

The quotas are the cornerstone of the EU's innovative emissions trading system, under which industrial polluters can buy and sell unused credits.

The system's credibility has taken a beating recently because member states have allotted more permits to pollute than industrial plants need.