A surprising development from a country not known for backing down from a fight:

In a sign that Paris has little stomach for a fight over global warming, Francois Fillon, the Prime Minister, urged the European Union to retreat over plans to tax airlines for emitting greenhouse gases.

His letter to Jose Manuel Barroso, the European Commission President, undermined the EU’s claims to be united in its drive to impose ecological virtue on the aviation industry. The plan to force airlines to buy pollution permits when flying in European airspace has been denounced as illegal by other capitals, notably Beijing, Delhi and Washington.

The so-called coalition of the unwilling is pledging to retaliate unless Europe backtracks. Chinese and Indian airlines have been told by their governments to boycott the scheme.

Their American counterparts filed a lawsuit before withdrawing it last month and calling on the Obama Administration to take the lead in pressuring Europe to drop its aviation pollution package.

In France, concern has been fuelled by Airbus, the European aircraft maker, which said that China had shelved orders worth $US14 billion ($13.5 billion) because of the dispute.

The company said that officials in China, which represents 20 per cent of Airbus sales, were withholding their signature on contracts for 35 long-haul A330s and 10 A380 superjumbo planes.

Air France, British Airways, Virgin Atlantic, Lufthansa, Air Berlin and Iberia joined MTU Aero Engines and Safran, the enginemakers, and Airbus in writing to European governments last month to warn of the consequences of a trade war. They said that thousands of jobs and billons of dollars of sales were at risk.

In his letter, written last month but made public yesterday, Mr Fillon said that 2000 jobs were under threat at Airbus and its suppliers because of the Chinese boycott.

Globalwarming.org has not blogged extensively about the ongoing airline emissions saga, though it has been covered in our weekly newsletter, which you can sign up for on our home page. The E.U. wants to require foreign airlines which land in the E.U. to purchase carbon credits for a cap-and-trade program the E.U. recently implemented. The airlines, naturally, are opposed. As is the rest of the world, with major countries such as China, the U.S., Russia, and many more signalling opposition.

Up until now, the E.U. spoke as a unified force, stating confidently that they will not back down. In response, China raised the stakes by cancelling orders for aviation equipment which are worth billions of dollars. Numerous other countries are still in the process of planning a response. It seems now that not all of the E.U. agrees with their official stance, which will likely strenghten the resolve of the opposition groups. If the E.U. stays course, expect more punitive retaliatory measures.

Two days ago, the New York Times reported that the French Parliament is “leaning” towards a ban on hydraulic fracturing, the American-made technological revolution in production that has vastly increased the known economically recoverable global reserves of natural gas. According to the article,

French lawmakers opened debate on Tuesday on proposals to ban a method for extracting oil and gas deposits from shale because of environmental concerns, throwing up the first serious stumbling block to firms that want to use the practice.

Looking with alarm at the experience in the United States, where shale gas is booming, even members of President Nicolas Sarkozy’s governing conservative party have come out against the practice, known as hydraulic fracturing, in which water, sand and chemicals are pumped deep underground under high pressure to free scattered pockets of oil and gas from dense rock formations.

The article, while interesting, misses the big picture. For starters, it’s unclear why French lawmakers would look “with alarm” at the U.S. experience. While there is some evidence that poorly built “fracking” rigs could lead to the escape of methane into local groundwater wells, this isn’t as disturbing as it sounds. Methane (ie, natural gas) does not make water poisonous, and there is no evidence that the fluids used in the process, which could be toxic, have leaked into well water. Much more importantly, there is ZERO evidence that the process affects water tables used for utility scale water supply, although environmentalist special interests are quick to try to conflate well-water methane contamination with water table contamination. The upshot is that hydraulic fracturing has been used in this country for fifty years, without harming public health and environment.

The article also omits mention of why France might be inclined to dismiss fracking: namely, because it isn’t needed. Since 1980, the French government has made nuclear electricity generation a policy priority, and, as a result, the country gets more than 75 percent of its juice from atomic power. That’s the most in the world—by far. For comparison, the U.S. generates about 20 percent of its electricity with nuclear, and Japan gets about a quarter of electricity generation from nuclear. In light of the government’s singular promotion of nuclear, France has a much lower incentive for other forms of electricity generation, like gas. It can afford to pass on the fracking revolution.

The situation is very much different in the rest of Europe. Spain, for example, uses much imported liquid natural gas for electricity generation, so it is more amenable to domestic hydraulic fracturing. About seven months ago, I had breakfast with a representative from an American gas company that was working closely with Spanish energy companies to develop the technology there.

Then there’s Germany. In that country, the Green Party is anomalously powerful, and their influence renders new nuclear and coal verboten. That’s a problem, because the only alternative to coal and nuclear is Russian natural gas. I won’t review 150 years of European history, but suffice it to say, many Germans aren’t keen on being increasingly dependent on the Russian Bear. The two countries have quite a past.

This applies to much of Central and Eastern Europe. Thanks to the European Union’s climate policies, new coal power is difficult. And thanks to the Japanese nuclear crisis, nuclear is out of favor, too. But for these countries, for whom the Russian yoke is all too fresh on the mind, dependence on Gazprom is out of the question. They are very much amenable to hydraulic fracturing technology.

I rarely sing the Obama Administration’s praises on energy policy, but I must give the President props for identifying the geopolitical opportunity inherent to fracking. The State Department has been actively promoting the technology in Europe, no doubt as a counter to the prospect of European reliance on Russian gas.

To be sure, I hate the way politicians in this country use “energy independence” to justify myriad stupid energy policies, but the gas market is very different from the oil market. Whereas the latter is a global market, the former is bound by the logistical infrastructure (ie, pipes). As a result, it’s relatively easy for Russia to play hardball and use gas deliveries as a diplomatic bargaining chip. It has done so with the Ukraine and Belarus.

France doesn’t need fracking; the rest of Europe does, because it’s much more attractive an option than the alternative, reliance on Gazprom or imported LNG. These geopolitical concerns will drive a European turn to the practice.