German Chancellor Angela Merkel said on July 3 she would press ahead in August with legislation that will encourage Germans to save energy. After a "summit" with industry on cutting carbon-dioxide emissions, Merkel told reporters the broad lines of the legislation would be settled when the cabinet meets at a country retreat, Meseberg palace outside Berlin.

The legislation is expected to push power companies to cut emissions, building owners to improve insulation and consumers to switch to low-emission cars and low-energy appliances.

An agreed statement from the meeting said prompt legislation was needed at the German and European Union level to support experiments in collecting carbon dioxide from furnaces and sinking it into deep rock.

Industry had complained before the meeting that Merkel's emissions targets were unrealistic, but Merkel said the tone of the talks, the third and last round in a series that began in April last year, had been sober.

She said there would be annual climate-change talks with industry from 2010 onwards to review progress. "The European Union has adopted ambitious targets in and obviously Germany will make its contribution to achieving those targets," Deutsche-Presse-Agentur (dpa) quoted her as saying. "That is an integral, unalterable part of our future energy policy."

She added that a German offer to cut carbon-dioxide emissions by 40 percent remained conditional on most of the world joining in. The basic target was to cut CO2 emissions by 20 percent by 2020. Only if other nations joined in would Germany expand the cut to 30 or 40 percent and she could not promise that before negotiations were finished.

Scientists advised the meeting that Germany could cut its carbon- dioxide emissions from power generation by 45 percent if it allowed 17 nuclear power stations to operate for an additional 20 years.

But Merkel said that during her chancellorship to 2009, she would not she would not reopen the nuclear issue. Under existing legislation, Germany is to phase out nuclear power by 2021.

Juergen Thumann, president of the Confederation of German Industry BDI, questioned the targets anew later. "It is a risky matter to make structural choices on energy policy on this basis," he said. "It's like driving a car without putting your safety belt on."

He renewed a call for more nuclear power but said he approved Merkel's emphasis on future energy supplies being secure, affordable and environmentally responsible at the same time.

Environmentalists welcomed Merkel's backing for robust targets. Angelika Zahrnt of one group, Bund, said, "She seems to understand that you can only fight climate change by standing up to the big electricity companies."