EU leaders divided over costs as climate deal talks start in earnest

BRUSSELS (Reuters) - European leaders aim to agree a new decade of energy policy to cut climate-warming gas emissions by 2030 at an EU summit on Thursday, but sharp differences over sharing the costs mean that securing a deal will be difficult.

The 28 member states want to set the pace for a global pact to be hammered out in Paris next year with industrial powers from Asia, North America and the rest of the world.

That pact would aim to improve on two decades of stuttering cooperation and rein in carbon dioxide emissions blamed for a disruptive rise in temperatures.

There is broad acceptance for an overall EU goal of cutting carbon emissions from homes, power plants, cars, planes, farms and other sources by 40 percent by 2030, compared with the global benchmark year of 1990.

Conflict between Ukraine and Russia, the EU's biggest energy supplier, has also focused the EU on reducing its reliance on imported fossil fuels by increasing use of renewable energy and using domestic sources more wisely.

Arguments about helping poorer eastern states may drag the negotiations through the night into Friday, diplomats said, though they still predicted that a deal could be achieved.

As host of next year's United Nations summit to negotiate a global climate deal, French President Francois Hollande said Europe had to take the lead.

"If there isn't an agreement in Brussels among the countries that are furthest ahead on this issue, how are we going to convince the Chinese or the Americans or the poorer countries?" Mr Hollande said on his arrival for the Brussels talks.

German Chancellor Angela Merkel, however, was cautious. "I cannot say whether there will be an agreement today," she said. "I don't think the talks will be easy, as we also need to look at our international competitiveness."

EU policymakers have sought to strike a balance between big business, which claims that more ambitious targets will drive away industry, and more innovative companies and green campaigners who say the outline goals lack ambition and will nip Europe's renewable technology sector in the bud.

For instance, ArcelorMittal has warned that the EU plans would make European steelmaking uncompetitive.

On the other side of the debate are the likes of Acciona and Unilever, which have called for an ambitious set of 2030 goals to encourage EU investment.