(updates with quotes from news conference, reactions) By Jeff Mason BRUSSELS, Jan 10 (Reuters) - The European Commission has announced what it says are the world's most ambitious targets for fighting climate change, proposing the bloc cut greenhouse gases by at least 20 percent by 2020 from 1990 levels. With oil imports hit by the latest dispute involving Russia, Brussels set out on Wednesday a vision of a common energy policy for the 27-nation bloc that would seek to ease dependence on foreign suppliers and reduce the dominance of big utilities. The EU's executive Commission made fighting global warming the core of the new policy. "If this was adopted it would be by far the most ambitious policy ever -- not only in Europe but the world -- against climate change," European Commission President Jose Manuel Barroso told a news conference. The new plan goes beyond an existing target for an eight percent cut in emissions from 1990 levels in the 2008-2012 period adopted by the 15 members of the EU before its 2004 enlargement and which several countries are already struggling to meet. Brussels also challenged developed nations around the world to cut emissions by 30 percent by 2020, a move the EU would match if others joined in. The energy plan must now be approved by EU governments. The EU has repeatedly urged the United States -- the world's biggest polluter -- and other major economies to drop their opposition to binding targets for emissions cuts. "We need the United States with us," said Barroso who met U.S. President George W. Bush this week. "I personally believe the United States will change and they will be much more ambitious in the future when it comes to climate change." Energy has been at the heart of the EU since it was born as the European Coal and Steel Community half a century ago but policy remains largely in the hands of national governments. This week's dispute between Russia and Belarus, which has hit oil exports to several EU nations, has highlighted the bloc's vulnerability to foreign producers of fuel. ENERGY SHAKE-UP Environmentalists said the Commission was too modest in its ambitions. "Scientific findings show that it simply won't be enough for the EU to only reduce CO2 emissions by 20 percent by 2020 if we want to avoid catastrophic climate change," said Jan Kowalzig, climate campaigner at Friends of the Earth Europe. But business lobby UNICE said the target was too high and European business would suffer if other countries around the world do not agree to cuts. The Commission's report said shutting nuclear reactors will make cutting greenhouse gas emissions harder. It encouraged countries that are phasing out nuclear, such as Germany, to replace it with non-polluting sources of power generation. The Commission proposed that renewable energy sources, such as wind, make up 20 percent of the EU's energy mix by 2020. This would be a binding target and compares to an existing goal of 12 percent by 2010, which the bloc is likely to miss. The new plan also says biofuels should account for a minimum of 10 percent of fuel used by vehicles by 2020. On one of the most sensitive items, Barroso said Brussels favoured splitting up the generation and distribution businesses of power companies as the best way to tackle what his regulators said were "serious competition problems" in the sector. But Germany and France oppose that idea and the Commission offered a second option of utilities handing over management of grid businesses while retaining ownership. That option would mean more intrusive regulation, an EU source said. French power giant EDF <EDF.PA> said full separation of generation and distribution was unnecessary. For a FACTBOX of the Commission's plans please click on [ID:nL10161235] (additional reporting by William Schomberg, Stuart Penson, Ingrid Melander, Darren Ennis, Mark John, William Emmanuel)
