 European Union leaders will seek to make history this week with a new pact to cut greenhouse gas emissions, but a row over renewable energy threatens to taint the bloc's credentials in fighting climate change. The 27 leaders, meeting on Thursday and Friday, are set to make an ambitious commitment to cut emissions blamed for global warming by 20 percent by 2020 compared to 1990 levels and 30 percent if other industrialised and emerging nations join in. Those targets will form the basis of the EU's negotiating position for an international agreement to extend the Kyoto Protocol past 2012. "This week, the eyes of the world will be on the European Council -- from Washington to Moscow to Beijing," European Commission President Jose Manuel Barroso told a news conference. "The EU needs to continue to show world leadership." But details of how to meet the goals continue to divide the 27-nation bloc, which has yet to meet the more modest emissions-cutting obligations its members took on under Kyoto. France, keen to promote its nuclear industry, and several central European states object to a binding target that would have renewable energy sources such as wind and solar make up 20 percent of energy consumption by 2020. The European Commission, with strong support from German Chancellor Angela Merkel, who will chair the summit, says non-binding targets do not work. "These targets should be binding, for the success and credibility of our policy. Of course, national targets to achieve this must reflect national circumstances," Barroso said. The EU has a voluntary goal to raise renewable fuels to 12 percent of the energy mix by 2010 but it is likely to be missed. EU ministers failed in three meetings in the last month to make the target binding, and a German presidency source said he did not expect the summit to take "a gigantic step further". Environmentalists see the clash as a credibility test for the EU's stated goal of leading the world on global warming. "If they falter on renewables, then how are they going to make sure they stop dangerous climate change?" said Mahi Sideridou, policy director at environmental group Greenpeace. "It's between climate protection or more hot air." Greenhouse gas emissions from the 15 EU states that were members before the bloc's 2004 eastward enlargement were down 0.9 percent in 2004, far off the group's Kyoto target of an 8 percent cut by 2012 compared to 1990 levels. The EU accounts for about 14 percent of global greenhouse emissions, blamed by scientists for causing sea levels to rise, glaciers to melt, and storms to intensify. Gases including carbon dioxide (CO2) from power plants and cars, methane from livestock and fossil fuel production, and nitrous oxide (N2O) from fertilisers are all major culprits. But as industrial economies in China and India grow, the EU's share of the world's emissions will go down. EU leaders hope that setting an ambitious internal target now will spur other nations, especially the United States, to act too. Creating a low-carbon economy is central to a wider strategy for a common EU energy policy integrating energy efficiency, clean energy technology, diversifying fuel sources, and speaking with a unified voice to Russia and other major suppliers. But states are also split on how to bring more competition to gas and electricity markets. Governments have not endorsed Commission plans to force energy giants such as E.ON and Gaz de France to split their generation and distribution businesses, calling instead for 'effective unbundling' of such operations. Brussels has also proposed a second option allowing utilities to hand over management of grids to independent operators while retaining ownership. "My forecast is that we shouldn't expect the European Council to give preference to any single option," a German source said on Tuesday. "The differences are so great that we won't get beyond what has been agreed so far."