By Pete Harrison

BRUSSELS, BELGIUM (Reuters) - The auto industry could be forced to improve the fuel efficiency of vans sold in the European Union by over 10 percent by 2016 in the fight against climate change.

The proposal by the EU's executive arm would also help reduce the region's oil import bill of around 250 billion euros (S$519 billion) each year.

The final deadline would be four years later than first envisaged after powerful auto makers pushed hard for a delay until the region had recovered from the economic crisis.

Car makers said the final proposal was still too heavy a burden during an economic downturn, while environmentalists said it was insufficient in the face of a climate crisis.

"The level of ambition was not as high as it was initially, but it is still an important decision," European Environment Commissioner Stavros Dimas told reporters.

"This proposal is good for consumers, good for industry and good for the environment."

Average carbon emissions for each van would have to be cut between 2014 and 2016 to 175 grams for every kilometre driven, compared to an EU average of around 200 grams now, if EU countries and the European Parliament approve the proposal.

By 2020, van makers would have to hit a target of 135 grams.

BATTLE

The launch of the proposal was delayed several times in recent weeks as officials in the Commission's industry and environment units wrangled over the details.

But Dimas said the battle had not been as tough as when he brought out regulations to clamp down on gas-guzzling cars.

"A climate crisis is upon us," said Greenpeace campaigner Franziska Achterberg. "Urgent and ambitious action is what we need, not months of foot-dragging and a shamefully feeble proposal with delayed targets."

Europe's big auto-making nations - France, Italy and Germany - had pushed the Commission for a delay to 2017. Demand for new light commercial vehicles has dropped 34.4 percent this year, car lobby ACEA said.

"The automotive industry, and in particular the commercial vehicle industry, is still suffering from a continuing credit crunch and a depressed economy," ACEA secretary general Ivan Hodac said in a statement.

"Policy makers must deliver on the balancing act between environmental and economic priorities," he added.

Environment group T&E said automakers had little trouble meeting emissions curbs for cars, once forced, some by over 13 percent a year.

"As a way out of this crisis, it would be far better to invest precious financial resources in low carbon technology than to waste them on importing oil," said T&E's Kerstin Meyer.

Van makers that overshoot the targets face fines.

In an initial period until 2018, the penalty will be 5 euros per van for each gram in excess, 15 euros for the second gram, 25 for the third and 120 for every further gram exceeding the limit.

From 2019, the first gram will cost 120 euros per vehicle.