SCENESETTER FOR FRENCH MINISTER OF STATE BORLOO'S VISIT TO

UNCLAS SECTION 01 OF 05 PARIS 000294

SENSITIVE
SIPDIS

FROM THE CHARGE FOR:
DOE SECRETARY CHU
DOT SECRETARY LAHOOD
USEPA ADMINISTRATOR JACKSON
WHITE HOUSE FOR FROMAN AND BROWNER
STATE SPECIAL ENVOY STERN AND
ACTING OES A/S HARNISH

USDA FOR OA - AMB SUZANNE HALE, OCRA SHARYNNE NENON
USDA ALSO FOR OSTA LIZ JONES

E.O. 12958: N/A
TAGS: SENV ENGR TRGY KGHG PREL FR
SUBJECT: SCENESETTER FOR FRENCH MINISTER OF STATE BORLOO'S VISIT TO
WASHINGTON MARCH 4

REF: A) 2006 PARIS 2439, B) 2007 PARIS 4139, C) 2007 PARIS 4364; D)
2008 PARIS 714; E) 2008 PARIS 1071; F) PARIS 00039 G)2008 PARIS

2222.



Summary
--------------


1. (SBU): Minister of State Jean-Louis Borloo arrives in Washington
March 4 to engage the USG on climate change and energy policy. As
the head of France's "super ministry" combining environment,
transportation and energy under the rubric of sustainable
development, Borloo is the third ranking official in France after
the President and the Prime Minister. He maintains consistent high
public approval ratings as well as a reputation for volatility,
unpredictability, and late night bon-vivant habits. Borloo also has
an impressive track record of delivering both a domestic
environmental policy (the "Grenelle of the Environment") and a
European deal on a post-Kyoto emissions regime. The climate and
energy package was one of France's top priorities in its 2008 EU
presidency and the GOF intends to remain in the vanguard of the
European Union in pressing the Copenhagen negotiating process toward
success. End summary.

Background
--------------


2. (SBU) Jean-Louis Borloo, born in 1951, is a popular, self-made
and now independently wealthy business executive and lawyer whose
first public achievement was as mayor to transform a decaying
rust-belt town in northern France to a vibrant community. Unusual
in France, he had the support of the right, left and center parties.
A close confidante of President Sarkozy, who reportedly considered
him for Prime Minister, Borloo is a centrist and a leader of the
Radical Party. He rallied late in the last campaign to support
Sarkozy. Borloo served previously as Labor Minister and as Junior
Minister for Towns and Suburbs (the urban renewal equivalent.) He
understands some English but prefers to use an interpreter. He has
had mixed relations with USG officials and was decidedly hostile to
the Bush Administration. In contrast, Borloo had productive
meetings with New York Mayor Bloomberg and with Senator Boxer.

The Super Ministry and Sustainable Development
-------------- -


3. (SBU) Nicolas Sarkozy put the environment at the center of his
administration from his election in May 2007. One of his first
actions was to merge three ministries (Transportation, Ecology and
Sustainable Development, and Regional Planning) with the Energy
Division of the Ministry of Economy into a single "super ministry"
of sustainable development (the Ministry of Ecology, Energy,
Sustainable Development, and Regional Planning or MEEDDAT),headed
by a Minister of State. Borloo took up this portfolio after a brief
tenure as Finance Minister, and a public gaffe about raising taxes
that appeared to cost Sarkozy's party in legislative elections. The
fusion was a complete reorganization of the components rather than
just a merger putting multiple organizations under a single
minister. For example, energy and climate change have been combined
into a single division. The ministry is largely collocated in new
common office space at La Defense while a single Ministerial Cabinet
(with four state secretaries in charge of Ecology, Transportation,
Regional and Paris Planning, and over 80 experts) formulates policy
from the elegant Hotel de Roquelaure on the left bank of the Seine.


The Grenelle Process and Results
--------------

4. (U) Borloo's first MEEDDAT success was the national-level
roundtable on France's environmental policies which met during the
summer and fall of 2007 and concluded in October 2007 at Elysee
Palace event attended by Nobel laureates Al Gore and Wangari

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Maathai. The results were packaged into two legislative bills,
labeled "Grenelle I" and "Grenelle II", which spell out a new
national sustainable development action plan. The main axes are
energy, construction, transportation, urban planning, and
agriculture. (Refs A, B and C)

5. (U) The first Grenelle priority is to reduce France's energy
requirements to improve energy efficiency by 20 percent by 2020,
generate over 95 percent of carbon-free electricity, increase
renewable energy to 23 percent of consumption, and achieve a
reduction of GHG emissions to 25 percent of 1990 levels by 2050
("factor four"). By 2012, all new buildings built in France will
comply with the low energy consumption standards; and by 2020,
buildings are to produce more energy than they use. The GOF plans
to stimulate the demand for efficient buildings by increasing
household tax credits for energy efficient equipment and renewable
energy, removing from the market the highest energy consuming
products (e.g. incandescent lights and single-pane windows by 2010),
and increasing energy labeling of all electronic appliances.

6. (U) The GOF plans to invest massively in the transportation
sector by developing urban transportation lines and refurbishing the
inland waterway and sea transport systems. The Grenelle set an
overall 20 percent emission reduction goal in the transport sector
by 2020. For automobiles, the GOF has already implemented a method
to reduce emissions to an average 130 grams of CO2/km by 2012 using
a bonus-malus system to provide a rebate on new newly purchased
vehicles which emit less than 130 grams of CO2/km and an additional
tax on those that emit more than 160 grams.

7. (SBU) In the agriculture sector, the Grenelle called for a
suspension of the cultivation of pest-resistant Mon810, the only
genetically modified (GMO) variety approved for planting in the EU,
pending the EU's 10 year review of MON810. The Grenelle justified
this moratorium by citing the precautionary principle, despite
consistent findings by the European authorities that MON810 poses no
health or environmental risk. The Grenelle also endorsed a 20
percent increase in land devoted to organic farming by 2020, and
additional tax incentives to increase the use of organic food to 20
percent of institutional and school catering by 2012. Use of
pesticides known to be dangerous is to be cut by 50 percent within
the next ten years. What the Grenelle did not address was nuclear
power. It is understood that the Sarkozy Government allowed an
extreme anti-GMO recommendation from the Grenelle process in
exchange for keeping the nuclear energy issue outside the ambit of
the exercise. Subsequently, the anti-GMO stance, which has
overwhelming public support, has become a symbol for Sarkozy's
platform of protecting citizens.


8. (SBU) The Grenelle outcomes were unveiled to parliament in April
2008 and in October the National Assembly overwhelmingly approved
the Grenelle I bill which adopted in legislation the broad
principles, targets and goals of the Grenelle. In February 2009 the
Senate also approved the bill with broad support. The ambitious
Grenelle II law incorporates implementation plans and has been
delayed, in part by the economic crisis and its impact on the GOF
budget. The bill will move forward to parliament in March and will
likely be voted on by fall 2009. In a sidelight to the
Parliamentary debate in early 2008, Secretary of State for Ecology
Nathalie Kosciusko-Morizet publicly criticized Borloo and
Jean-Francois Cope, leader of the UMP party in the National
Assembly, for their positions on the GMO law, saying that the
parliamentary debate on GMOs was a "competition of cowards."
Sarkozy demanded a public apology and instructed her to mend fences.
Kosciusko-Morizet acquiesced and worked closely and effectively
with Borloo during the EU presidency. However, during Sarkozy's
cabinet reshuffle earlier this year, she lost out with a transfer to
the Prime Minister's office as State Secretary for Technology and
the Digital Economy. (Refs D and E)

Precautionary Principle
--------------


9. (SBU) French policy regarding biotechnology is based on the
precautionary principle, which in 2004 was written into the French

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constitution as part of the Environmental Charter. At the time, the
precautionary principle sparked debate over the prospect that it
would hamper research and lead to lawsuits. However, the GOF
eventually adopted a watered down version of the principle. The
GOF's application of the precautionary principle reflects both
widespread support by the French population, tinged with
protectionism. The French action to ban planting of MON810 was
taken despite the EU and French food safety agencies' scientific
determination of its safety. Citing the same principle, France
supports the EU Commission's REACH program for chemicals that
imposes stronger obligations on foreign firms selling into the
European market than on similar European firms. Finally, France is
likely to advise the EU to ban the importation and marketing of
products of cloned animals and their offspring. MEEDDAT champions
the concept of incorporating societal concerns and preferences into
the EU's biotech review process. MEEDDAT Minister Borloo himself
does not appear to have a strong personal stake in the GMO issue,
but neither has he been a champion for science-based policy.

The French EU Presidency
--------------


10. (U) With an agreed domestic package on environmental policy,
Borloo moved to the EU's climate change negotiations, which are
intended to prepare Europe for the December 2009 Copenhagen
negotiations. To motivate the EU Member States to accept a bold and
audacious "climate and energy package," in July 2008 France
organized an informal presidency workshop on climate negotiations.
Borloo's speech pointed out the high stakes when he said, "The
European Union, if it is to affirm its driving role in international
negotiations, must set a good example. The EU cannot demand global
effort in the fight against climate change if it has not managed to
share the effort that needs to be made between the Member States."
Borloo's goal was to reach an agreement on the EU climate package
before UN negotiations in Poznan. To bolster the ranks of its
negotiators, Borloo hired Peter Carl, a Dane who had served as the
Director General of the EU's Environmental DG, to work the EU member
countries on behalf of Borloo's goal of a strong package. In the
end, Borloo had to make some compromises with Poland on coal-fired
electric power plants, with Germany on automobile industry, and with
Italy on heavy industry. Environmentalists complained bitterly that
the compromises threatened the EU's ability to reduce GHG emissions
by 20 percent below 1990 by 2020. But Borloo decided that the EU's
"climate and energy package" was sufficient to give the EU
credibility in the negotiations at Copenhagen.

Borloo's Washington Agenda
--------------


11. (SBU) MEEDDAT officials have told us that Borloo's top three
items in Washington are: global climate change, Copenhagen
negotiations strategies, and methods for reducing GHG emissions;
nuclear power; and transportation, including expanding the high
speed rail network in the U.S.

Climate Change
--------------


12. (U) As Borloo's trip at the outset of the Administration makes
clear, the French want to be the first to engage the U.S. on climate
change negotiating strategy for Copenhagen. Some French officials
are concerned that if the USG does not define a strategy before the
EU decides on its strategy, the EU and American strategies might be
at odds in Copenhagen. They believe that a joint US-EU effort is
needed to bring the major developing country emitters into some
legal framework. Despite the economic crisis, Borloo still believes
he can sell the Sarkozy plan to even reluctant countries at
Copenhagen, especially if he can bring the U.S. on board at an early
date. (Ref F)

Comparability and Cap and Trade
--------------

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13. (SBU) French policy is to urge the U.S. to adopt an ambitious
EU-compatible "cap and trade" mechanism to push America's GHG
emissions below 1990 levels by 2020, falling into line with
Sarkozy's EU eco-timetable. A key French point is the need for
compatibility of any new American cap and trade system with the
existing EU Emission Trading Scheme (ETS). The French believe that
a common US-EU cap and trade system would then become the de facto
standard for other OECD member countries. The "comparability of
effort" question is important because the EU package includes the
principle of carbon import duties to prevent "carbon leakage" from
countries with insufficient effort to reduce GHG. Senior French
officials, while hoping for an ambitious U.S. GHG reduction target,
hint that a less ambitious goal, if written into U.S. law, could be
acceptable as a "comparable effort" because it starts the U.S. down
the GHG emission reduction road. In these officials' view, the
direction and degree of commitment of U.S. GHG policy are generally
more important than a numerically equivalent reduction.

Carbon Capture and Storage (CCS
--------------


14. (U) The French see CCS as a means of persuading fossil-fuel
dependent countries such as Poland to reduce their net carbon
emissions. Because France itself depends on nuclear and hydro for
about 90 percent of its electricity, France is mainly interested in
CCS for carbon intensive industries such as cement manufacturing and
steel smelting.

Major Economies Meeting (MEM) Process
--------------


15. (U) The French find the MEM process valuable, and hosted the
third MEM meeting in Paris last year. Sarkozy has stressed the need
for both developed and developing countries to take responsibility,
even if the responsibility is differentiated. The French may
encourage the Administration to continue the same process to
facilitate consensus during the climate negotiations.

Alternative Energies
--------------


16. (U) The French made an abrupt shift last year in their view of
renewable energy sources away from biofuel, and to a lesser extent
away from wind, in favor of solar. Previously, the French goal was
that biofuels should be 7 percent of transportation fuel by 2010,
and should be 10 percent by 2015. A MEEDDAT-sponsored think-tank,
the Agency for the Environment and Energy Management (ADEME) is
conducting a study of the future role of biofuels, focusing on
future prospects for second generation biofuels that would not
compete with food crops. French policy awaits the results, which
are scheduled for summer 2009. Borloo announced, last year, a
package of fifty measures to boost renewables in France's general
energy consumption mix to 23 percent. The initiative will accelerate
research and promote projects in bioenergy, hydraulic, wind,
geothermal, solar, and marine energies and develop industrial
capacity, especially for solar power. Solar is the big scheme.
France plans to reach 5,400 MW of photovoltaic power by 2020.
France will create a new feed-in-tariff electricity production
incentive (Euro 0.46/kWh) for large roofed buildings. The GOF plan
to increase installed wind capacity from 2,500 MW in 2007 to 25,000
MW in 2020, of which 6000 MW will be from off-shore wind farms. (Ref
G)

Aviation and Shipping
--------------


17. (SBU) The French think that the Kyoto Protocol was mistaken when
it acknowledged the roles of the International Civil Aviation
Organization (ICAO) and the International Maritime Organization
(IMO) in climate change and instructed Annex I parties to work
through them to tackle this issue. Concerned that the ICAO and IMO

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are moving too slowly, the European Commission has proposed setting
a deadline for the ICAO and IMO of end of the year 2010, or else
bringing this issue entirely into the UNFCCC framework.

Public Transportation
--------------


18. (SBU) The French are justly proud of their high speed TGV
railroad network. French policy is to promote the export of the
TGV. Longstanding efforts to introduce TGV projects in the U.S in
the Northeast Corridor, California and Texas are perennial subjects
for the French equipment producers and operators.

Nuclear Power
--------------


19. (SBU) Sarkozy is committed to the modernization of French
nuclear energy industry and know-how, while optimizing security and
nuclear waste handling. The GOF supports the third generation
European Pressurized Reactor (EPR) built by state owned AREVA. The
first EPR is currently under construction in Finland, with the
second in France's Normandy region. AREVA is France's National
champion for advanced civilian nuclear power, and already has a
substantial presence in the United States. AREVA is a constructing
a mixed oxide civil nuclear fuel rod plant at the Savannah River
Site, South Carolina. However, AREVA has encountered problems in
obtaining DOE security clearances for French technicians. France's
national power company, EDF has obtained Federal Energy Regulatory
Commission (FERC) approval to purchase 50 percent of Constellation
Energy of the US, and plans to build at least two EPR reactors on
Constellation sites.

U.S.-France Research Cooperation
--------------


21. (U) The French welcomed U.S. participation in the ITER (the
International Thermonuclear Experimental Reactor) Project in
Cadarache, about 50 miles northwest of Marseille, France. The GOF,
which provides strong financial support, is well aware that the U.S.
Congress has slashed funding over the past several years, with
implications for the future of the project. The French have asked
about the likelihood of the current Congress restoring funding. The
French are strong supporters of the Global Nuclear Energy
Partnership (GNEP),and last October Minister Borloo spent a
considerable amount of time at the GNEP ministerial in Paris.
MEEDDAT works closely with DOE on the fourth generation nuclear
power project (GEN 4). In October, the French signed an agreement
to cooperate with DOE on exchanging classified information on the
protection of nuclear material, but so far have not responded to DOE
efforts to move to the implementation phase.

Comment
--------------


22. (SBU) Jean-Louis Borloo can be unpredictable and at times
difficult, but his goal on this trip is to access the prospects for
a Franco-American partnership in global climate change negotiations.
The French are convinced that Europe and the United States have a
strong common interest and must work in tandem to bring the major
emerging countries into a consensus. France is, and will continue
to be, a leader in the EU on climate change policy and the GOF is
more inclined to think and act boldly than most European
governments. While the intellectual side of the French body politic
can be a source of frustration, it has led Europe's thinking over
the past several centuries.


PEKALA