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http://www.businessgreen.com/bg/news/1900455/eu-offer-kyoto-compromise-cancun

The EU will agree to a second commitment period for the Kyoto Protocol, provided a number of reforms are made to the international agreement and it is accompanied by a parallel second treaty that covers those countries that currently have no legal obligations under Kyoto.

UK Secretary of State for Energy and Climate Change Chris Huhne said the bloc has agreed a series of conditions under which it will sign up to an extension of the Kyoto Protocol before it expires in 2012.
The two main conditions concern changes to the second commitment period to ensure the "environmental integrity" of the Kyoto Treaty and the agreement of a second treaty that would see all countries make legally-binding climate change commitments.
Huhne said any extension of the Kyoto Protocol would have to address the glut of so-called "hot air" Assigned Amount Unit (AAU) carbon credits that are currently held by Russia and a number of eastern European countries.
Experts claim these credits, which built up following the collapse of the Russian and eastern European economies in the 1990s, could undermine any future emission reductions delivered through the Kyoto Protocol if they are not retired.
Meanwhile, the EU would also demand the finalisation of a parallel treaty that would aim to impose legally binding commitments on those developing nations that were only required to take voluntary action under the original Kyoto Protocol.
EU diplomats are likely to agree that under such a treaty each individual developing nation, including China and India, would be able to volunteer the package of actions and targets that would then become legally binding.
The commitments would be expected to be largely in line with those made as part of the voluntary Copenhagen Accord, although negotiators openly admit that the targets contained in that agreement still fall short of what is required to limit climate change to less than two degrees Celsius.
The EU's position is likely to be relatively well received by many poorer nations, some of which are pushing for a second commitment period for Kyoto and privately accept that they will have to make some binding pledge to curb their emissions growth in return for increased climate financing from industrialised nations.
However, the offer effectively mirrors the negotiating position adopted by the EU at last year's summit in Copenhagen, which was comprehensively rejected by India and China on the grounds that neither country would submit to legally binding emission targets until industrialised countries such as the US agreed to significantly more ambitious targets of their own.
Privately, EU negotiators admit there has been no evidence from China and India to suggest they will shift their position, beyond commitments from both countries that they will continue to increase investment in low carbon infrastructure.
Any parallel treaty would also have to include the US, which never ratified the Kyoto Protocol and is highly unlikely to gain approval from a Republican-controlled Congress for any new international climate change deal.
However, EU diplomats remain optimistic that some form of compromise may begin to emerge from Cancun which could see a critical mass of countries agree to conditions that could break the current deadlock.