Amid widespread concerns that the global financial meltdown could hinder efforts to tackle climate change, European Commission plans to cut greenhouse gases face difficulties after EU environment ministers led by Italy called for significant changes at a meeting in Luxembourg on Monday.

Under the plans, the EU would cut greenhouse gases by 20% compared to 2005 levels by the end of the next decade. The major sticking point is proposed reforms to the existing carbon emission trading scheme, which when first implemented in 2005 gave carbon credits to industry for free.

Now the European Commission wants industry to buy emissions allowances at auction from 2013. According to press reports, some EU member states, including Italy and highly coal-reliant Poland, are concerned that the reforms would put them at a competitive disadvantage. They have threatened to block the plans unless amendments are made that would allow energy intensive industries such as cement and steel and the power sector to keep their free allowances until 2020.

“The package as it stands right now is not suitable. Significant changes are needed,” Italian environment minister, Stefania Prestigiacomo, told the EU Observer.

The member states’ concerns seem to have won some understanding from the EU Commission and the French presidency, according to the European Voice. The paper reports that Italy and the Commission will start a series of talks next week aimed at resolving the difficulties.

Meanwhile, Gordon Brown, the UK prime minister, is insistent that the credit crunch will not derail Britain’s target of cutting domestic green house gases by 80% of 1990 levels by 2050. According to Reuters, Brown sent a video message to a wind energy conference in London yesterday saying, “You may have heard some people say that these difficult economic times should or will reduce the government’s commitment to building a low carbon economy. They should not and will not.”