David Miliband: We cannot curb global warming without EU action

Climate change is a global issue. We need international co-operation backed by rules

It may seem arcane and technical, but yesterday's decision by the European Commission to reject all the carbon caps submitted by EU nations, except the UK's, represents a landmark in the fight against climate change.

We need to be clear about what happened yesterday. The European carbon trading scheme rations emissions from power stations and energy-intensive businesses. Companies can either stick to their quota or buy permits from companies who have made reductions. Nearly half of Europe's carbon emissions are covered by the scheme. Carbon trading works only if governments ratchet down the quotas they give to companies in line with their Kyoto obligations. But, as the Brussels authorities made clear, the proposals by European countries were wholly inadequate and need to be strengthened.

Yesterday was the stuff of Eurosceptic nightmares - Brussels imposing discipline on sovereign European nations. But climate change is a global issue. We need international co-operation backed by rules and institutions. The UK makes up just 2 per cent of global emissions. Europe together can make a significant contribution to global emissions, and has the weight to bring other countries on board and convince developing countries that industrialised nations are prepared to show leadership.

The lesson I draw from the Commission's actions is that the UK can play a strong role in international leadership. The first major decision taken by Alistair Darling and me in our new posts was to reduce the carbon allowances given to UK companies by 8 million tonnes - the most ambitious option on which we consulted.

We argued at the time that a strong UK policy would strengthen the European Commission's ability to push for strong carbon reductions across Europe. As a result, the UK is the only country to have its National Allocation Plan agreed by the Commission (though our plan was formally rejected due to a technical issue to sort out in relation to Gibraltar), and the European Commission is now asking other countries to raise their levels of ambition.

That is why the UK, through the Climate Change Bill and through international negotiation, must be prepared to be leaders in the shift to a low-carbon economy and press others to follow.

The next six months will be a test for European nations and the EU itself. Each nation must set out new proposals for more ambitious reductions in carbon dioxide. The European Commission should take steps to bring aviation into the emissions trading scheme at the earliest opportunity. Beyond this, they must examine the case for more radical reforms of the scheme.

Europe must commit to reducing greenhouse gases by 30 per cent by 2020 and ensure the allocations within the EU Emissions Trading Scheme (EU ETS) are consistent with this goal. The Commission must secure the future of the EU ETS beyond 2012; link the scheme to emerging carbon markets around the world, such as California, so that it can become the basis of a global carbon market; and scale up the use of the Clean Development Mechanism that allows businesses to buy emissions reductions in developing countries - a mechanism that involves major transfers of resources from North to South.

The emerging role for the EU has a wider implication for British politics. The point is simple: any person who is serious about climate change has to be serious about strengthening the EU. This poses an ideological dilemma for the Tories. If David Cameron is to be credible on green issues, he will have to resolve the contradiction between being pro-climate change, but dogmatically anti-European. Just as New Labour in the 1990s was prepared to focus on ends not means, even if it meant shedding our attachment to particular policies or prejudices, so, too, must the Tories.

The EU can and must become a major player in the fight against climate change. Global problems require the global co-operation and the EU can achieve this. Yesterday's decision is a start, but over the next year, climate change must become the defining goal for the EU's institutions, policies and budget. At a time when the Second World War is no longer a memory for most citizens but an important piece of history, the EU must find a new raison d'être based on future threats not past achievements. The EU must forge an Environmental Union.

The writer is Secretary of State for the Environment