Europe needs to spend billions to meet 2030 climate target: WoodMac

LONDON (Reuters) - Europe needs to invest billions in renewable power and storage or it will fail to meet its 2030 climate target, a report by consultancy Wood Mackenzie said on Thursday.

European Union leaders in December agreed to cut net greenhouse gas emissions by at least 55% from 1990 levels by 2030, substantially toughening an existing 40% target.

But the Wood Mackenzie analysis found that, under current plans, Europe would reach an emission reduction cut of 46% compared with 1990 levels by 2030.

To meet the new target the bloc needs a significant increase in renewable power capacity, such as wind and solar and electricity storage, equating to around $585 billion in investment by 2030, the report said.

Technology to capture and store carbon emissions (CCS), widespread use of hydrogen as a fuel, more electric vehicles and reforms of the bloc’s emissions trading system (ETS) including the introduction of a floor price on the cost of carbon emissions are also necessary, the report said.

A $65 per tonne carbon price would ensure the maximum possible shift from polluting lignite power coal plants to lower emission gas-fired power plants and would spur investment in technology, the report said.

The price level is almost 30% higher than current benchmark prices in Europe’s ETS of 39 euros/tonne ($47.03).

"Providing certainty on the carbon price now would help to grow that pipeline of CCS and hydrogen projects that’s needed," Wood Mackenzie Research Director Murray Douglas said.

($1 = 0.8292 euros)

(Reporting By Susanna Twidale; editing by Barbara Lewis)