By Jeff Mason

UNITED NATIONS, Sept 26 (Reuters) - The European Union pressed world leaders this week to follow its lead in fighting climate change, but a battle looms at home over how to share the burden of cutting greenhouse gas emissions.

The EU in March agreed to cut emissions blamed for global warming by 20 percent by 2020 compared to 1990 levels and 30 percent if the rest of the world joins in.

European leaders such as German Chancellor Angela Merkel urged their counterparts at the United Nations to follow suit.

"Industrialised countries must embrace ambitious absolute reduction targets," she told the U.N. General Assembly.

But the details of how the EU will achieve its goals are still being worked out, and the main sticking point will be how to divide up the overall target among the 27 member nations.

"It will be a battle," Danish Prime Minister Anders Fogh Rasmussen told Reuters in an interview in New York. "For all member states, this is a question of basic interests."

Countries that take a bigger share of the EU reduction will have to force their power generators and energy-intensive industries to cut back further carbon dioxide (CO2) emissions.

Circumstances have also changed since the first 15 members of the EU agreed collectively to cut emissions by eight percent by 2012 under the Kyoto Protocol.

Now there are 27 member states, and many of the newcomers are former communist countries whose economic catch-up ambitions trump their environmental aspirations.

"It's not going to be easy," European Commission President Jose Manuel Barroso told Reuters. "I expect, of course, difficult debates but I hope that as always ... in the end we will come to a good compromise."

BURDEN SHARING

The Commission is set to issue a plan in December that lays out how the targets should be distributed. That legislation, often referred to "burden sharing," will then have to be endorsed by national governments.

The EU executive body was working on a fair mechanism to determine each country's burden that would take into account different economic and environmental conditions, Barroso said.

"We have 27 different countries, we cannot pretend that the situation is all the same," he said.

Polish President Lech Kaczynski, for example, said deeper emissions cuts would be a challenge for his country, which burns coal to generate 90 percent of its electrical power. Help with costly "clean coal" technology would be vital, he told reporters during the U.N. conference.

The draft legislation will also include changes to the bloc's emissions trading scheme and national targets for another EU goal of having 20 percent of its energy come from renewable sources by 2020.

The proposals are slated to come out just before a U.N. climate change conference in Bali, where delegates hope to start talks on a successor treaty to the Kyoto Protocol.

EU leaders aim to show leadership at that conference, but they may still be squabbling about their own targets.

"This is a very critical negotiation process," said Denmark's Rasmussen. "But I think there is a strong political will and a strong political commitment to reach an agreement."

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