A report published by Bloomberg New Energy Finance states that raising the European Union's carbon reduction target for 2020 from 20% to 30% will cost EU countries under 0.04% of GDP, with some member states getting a net benefit.
According to the report's authors, a more ambitious programme of European emissions reduction between now and 2020 would cost no more than the equivalent of a few cups of coffee per person per year. The report argues that some countries stand to receive an economic benefit from any move to a 30% target, specifically Belgium, Bulgaria, Czech Republic, Estonia, Hungary, Lithuania, Poland, Romania, Slovakia and Slovenia.
These countries benefit by being able to sell surplus carbon allowances to other EU countries that are short of them. The first group will have those surpluses because its members will be able to make use of more low-cost abatement opportunities, such as energy efficiency improvements, and because of the structure of the proposed targets that take into account differing levels of national income across Europe. Some of these countries would benefit by up to 0.5% of GDP.
Countries facing the highest additional costs in absolute terms would be France, Germany, Italy and the UK, with between €1.1bn and €2.5bn per year of cost each. These costs would however represent a maximum of 0.05% of GDP.