As CEOs of leading European utility companies, we urge European leaders to move beyond the 20% economy-wide greenhouse gas emissions reduction target by 2020. This would contribute to a healthy and market driven EU investment climate for sustainable energy and put Europe back in the driving seat in the transition to a prosperous, low carbon Europe.

Recent international climate negotiations didn’t have the result many had hoped for and which science indicates is required. At the same time, market prices point to strong demand growth for key commodities, threatening our energy security. Yet, within the EU, the focus on effective climate change policies and their importance for our energy system seems to have lost momentum. Therefore we want to show our ambition and share the responsibility to maximize efforts to tackle climate change and maintain the leading role of European power companies in renewable and other low carbon technologies.

We acknowledge the analysis in the draft communication from the European Commission “A roadmap for moving to a low carbon economy in 2050”, that a move to 25% domestic reduction by 2020 represents the most cost-efficient pathway to the necessary reductions of 80-95% GHG emissions in 2050. We also support the clear vision for the power sector: moving away from fossil based electricity generation and reducing our sectoral emissions by around 60% by 2030, on the path to full decarbonisation by 2050.

As leaders of utility companies we know that the benefits of early action far outweigh the costs of inertia or delayed action. In the current economic context it is simply vital that the targets are both ambitious and unambiguous and provide a clear signal to Europe’s businesses and citizens. Private investors take their signals from such targets and more ambitious targets will stimulate more low carbon investment. This will deliver more new jobs in innovative environmental and clean technologies and will secure competitive advantage within the borders of the European Union.

Strengthening the EU Emissions Trading Scheme is key to this effort, along with effective national schemes to support renewable energy. In the short term, new efforts to meet the EU's energy efficiency target of 20% must be accompanied by renewed commitment to improve the effectiveness of the ETS, to ensure efficiency gains are not undermined by emissions from the industry and power sectors. For the period after 2020, the ETS cap must be aligned with the pathway set out in the roadmap.

On February 4th 2011, European Heads of State recognized that Europe needs a revolution in our energy system, which must start immediately. This will not happen if we don’t step up our ambition now. We therefore urge our leaders to deliver on their commitments, support that revolution and move beyond the 20% by 2020 target to a domestic target of at least 25%.

Our companies are prepared to play our part in the transition to a prosperous and low-carbon Europe. For us, tackling climate change should be a race to the top, not a case of settling for the lowest common denominator. This race is a competitive one, and the low carbon economy is ultimately the only winning strategy for future prosperity in Europe.