LONDON, Jan 23 (Reuters) - The European Commission adopted a far-reaching plan on Wednesday to cut EU emissions of greenhouse gases blamed for global warming, boost renewable energy use and increase biofuels.

Key features include a major overhaul of the EU's flagship Emissions Trading System (ETS), including auctioning emissions permits that were previously handed out for free.

Immediately after the announcement, carbon emissions certificates for delivery in December 2008 fell by 35 cents, or 1.7 percent. They were trading 25 cents lower at 20.06 euros a tonne by 1617 GMT.

The following are reactions from government, industry, campaigners and analysts.

* INDUSTRY

SPOKESWOMAN FOR DRAX POWER LIMITED, UK'S BIGGEST SINGLE EMITTER OF CARBON

"What we must do now is work on the detail of that auctioning process with the government... What we want to do is ensure that the design of the auction that is adopted for the EU ETS is a good one, that it's fair, reasonable and efficient."

"In terms of whether we generate or not, the decision is no different because we only generate when it's economic to do so... We support a price for carbon. We believe it is the right mechanism to incentivise CO2 emission reduction."

"As soon as it becomes absolutely concrete and you know what it's going to be like out to 2020 it's a much better position to be in."

HELMA KIP, MANAGER OF SUSTAINABLE ENERGY AND REGULATORY AFFAIRS AT DUTCH GENERATOR ESSENT

"The ETS is a good system in principle but if you look at the proposals we feel that not everything is well thought-out, especially with regards to the auctioning."

"If you want to organise an auction, then you have to know who can participate, what are the times that you auction, what will you do with the money, and all of this has to be worked out in just a few years."

DAVID PORTER, CEO OF THE ASSOCIATION OF ELECTRICITY PRODUCERS, WHICH REPRESENTS COMPANIES PRODUCING 95 PERCENT OF BRITAIN'S POWER:

"One way or another reducing carbon emissions from the electricity industry costs money. It will be interesting to see how the revenue that is taken from the electricity industry is used when it gets into government hands."

JAKE ULRICH, MANAGING DIRECTOR, CENTRICA ENERGY:

"It is good news that in the power generation sector at least, the Commission is moving from a system of free handouts of allowances to emit CO2 to full auctioning instead. This will ensure that the polluter pays and will end huge windfalls to the highest polluting generators."

GRAEME SWEENEY, EXECUTIVE VICE-PRESIDENT, FUTURE FUELS AND CO2, SHELL:

"The European Commission and member states need to work together, as a matter of urgency, to ensure the financial support is there to enable the successful demonstration of this technology within an overall programme with shared learning."

PETER HUBBARD, CHIEF EXECUTIVE, AXA INSURANCE:

"The European Commission's proposals represent a welcome step towards developing the policy frameworks that are needed to move the EU towards a low carbon economy. Tackling climate change is the pro-growth strategy. Ignoring it will ultimately undermine economic growth."

CHRISTIAN KJAER, CHIEF EXECUTIVE, EUROPEAN WIND ENERGY ASSOCIATION:

"The target implies that renewable energy's share of electricity will increase from 15 percent today to more than a third of Europe's demand in 2020. Wind energy will be the biggest contributor to that massive increase in clean electricity production."

* GOVERNMENT

HILARY BENN MP, BRITISH ENVIRONMENT SECRETARY:

"This plan shows exactly what we are aiming for globally -- a comprehensive and affective agreement to tackle climate change, with the carbon market at its heart. With a global deal the EU will up it commitment to cut greenhouse gas emissions to 30 percent by 2020."

JOHN HUTTON MP, BRITISH BUSINESS SECRETARY:

"The Commission's proposals on removing regulatory barriers to Carbon Capture and Storage (CCS) are vital. Demonstration of this globally significant technology must happen as soon as possible and I hope that the UK's demonstrator plant, expected to be up and running by 2014, can fully participate in EU initiatives on CCS demonstration."

* CAMPAIGNERS

ROBERT BAILEY, OXFAM INTERNATIONAL SPOKESMAN:

"Oxfam is already seriously concerned that the EU's biofuels strategy fails to protect the land, livelihoods and human rights of vulnerable people, creating a huge threat to sustainable development where there should have been an opportunity. It is untenable for the EC to proceed with this legislation in the knowledge that it is unlikely to deliver on its primary policy objective of reducing emissions from transport."

MAHI SIDERIDOU, GREENPEACE EU CLIMATE AND ENERGY POLICY DIRECTOR:

"This package contains a number of progressive elements but one fundamental drawback: its emissions numbers do not yet add up to a 30 percent cut... As things stand, EU countries and industry will deliver less climate action than we need, by aiming for an inadequate emissions cut of 20 percent by 2020. The good news is that the level of its ambition must and can be easily revised upwards."

STEPHEN SINGER, HEAD OF EUROPEAN CLIMATE & ENERGY UNIT, WWF:

"The European Commission presented a relatively weak proposal and not a single European country supported more ambitious targets... Overall, it is a very small effort to cope with a threat that might lead to Arctic melting and displacement of millions of people in developing countries because of increased floods."

* ANALYSTS

ROBERT CASAMENTO, DIRECTOR IN UTILITIES TEAM, ERNST & YOUNG:

"Europe has been the global leader on emissions trading for the last three years -- but the EU needs to consider the pace and the scale of implementing changes to the developing ETS. It cannot continue to go it alone without others such as the U.S. and eventually India and China -- emissions trading schemes need to be developed worldwide."

MICHELLE THOMAS, HEAD OF RENEWABLES TEAM, EVERSHEDS LAWYERS:

"Realistically, it was always going to be a challenge for the UK to meet its targets. It is questionable what impact the current credit squeeze is going to have. We are not seeing any projects held back but we are experiencing late changes to credit terms."

TOM DELAY, CHIEF EXECUTIVE, CARBON TRUST:

"The measures announced for the next phase of the EU ETS are very welcome as they will increase and firm up the price of carbon -- essential if we are to drive investment in low carbon technologies at the scale required to deliver the deep carbon cuts necessary to mitigate the impact of climate change."

MARK SPELMAN, GLOBAL HEAD OF STRATEGY, ACCENTURE:

"Dirty energy will become a real and tangible cost for business. Despite the large venture capital investment going into renewables, the outlook is that we will remain hugely dependent on fossil fuels for the next 25 years... Renewables is a step in the right direction but coal remains the big, unanswered question." (Reuters energy desk)

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