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By Pete Harrison and Marcin Grajewski
BRUSSELS (Reuters) - European Union leaders agreed an offer to put on the table at global climate talks in Copenhagen in December after healing a rift over how to split the bill.
Developing countries will need 100 billion euros ($148 billion) a year by 2020 to battle climate change, leaders said at an EU summit in Brussels on Friday.
About 22-50 billion euros of the total will come from the public purse in rich countries worldwide and the EU will provide a share of that. Many countries expect the EU's portion to be somewhere between 20 and 30 percent.
"I think this will be seen as one of the major breakthroughs that is necessary for us to get a Copenhagen agreement," British Prime Minister Gordon Brown said.
East European countries said the summit had settled a rift over how to split the EU's portion of the bill in a way that would not hurt their economies as they recover from crisis.
"We consider this a success for Poland," said the Polish minister for Europe, Mikolaj Dowgielewicz. "We want to develop quickly. We don't want to become the museum of folklore of eastern Europe."
Leaders fell short of agreeing a concrete formula for carving up the bill and handed that job to a new working party.
"I would prefer this burden-sharing mechanism to be ready now, but this proved too difficult," Polish Prime Minister Donald Tusk said.
MANDATE
The two-day summit secured a complex negotiating mandate for the Copenhagen talks to find a successor to the Kyoto Protocol, the United Nations anti-climate change scheme expiring in 2012.
Success at those talks is likely to hinge on money.
Developing countries say they will not sign up to tackling climate change without enough funds from rich nations, which bear most of the responsibility for damaging the atmosphere by fuelling their industries with oil and coal over decades.
Developing countries might use such funds to adapt their agriculture or find new sources of water in drought zones.
But the European leaders put on hold earlier plans to come up with "fast start" financing for developing nations in the three years before any new climate deal takes effect.
Anti-poverty group Oxfam said Europe's bid was insufficient and lacked guarantees that the money would not simply be diverted from existing aid commitments.
"If rich countries steal from aid budgets to pay their climate debt, the fight against poverty will go into reverse," Oxfam's Elise Ford said.
HOT AIR
The opposition to a deal from east European countries largely dissipated after Sweden, which chaired the talks, leveraged the divisive issue of so-called "hot air" -- the 17 billion euros of carbon permits held by eastern Europe.
The eastern European states, Russia and Ukraine hold spare permits for about 9 billion tonnes of carbon emissions, left over when their economies collapsed after communist rule ended.
The spare permits, known as AAUs, can be sold to big polluters such as Japan for about 10 euros per tonne.
The eastern European countries want to keep selling AAUs under the deal that replaces Kyoto. But some countries such as Germany say they undermine the integrity of the agreement and want to scrap them because they lessen the need for action to limit greenhouse gas emissions.
Sweden won eastern Europe's support for the overall deal in return for postponing any bold action on AAUs, one EU diplomat said.
The deal also included action on domestic emissions, with a pledge to strengthen cuts to 30 percent below 1990 levels by 2020 if other nations take similar steps.
(Reporting by Pete Harrison, John O'Donnell, Marcin Grajewski, Tim Castle and David Brunnstrom, writing by Pete Harrison, editing by Timothy Heritage and Dale Hudson)

Reuters