"This text is indeed a breakthrough as regards the environment and climate change policy of the European Union," Merkel said.
On Thursday, the 27 leaders committed themselves to a target of reducing EU greenhouse gas emissions, blamed for heating the planet, by 20 per cent by 2020 and offered to go to 30 per cent if major nations such as the United States, Russia, China and India follow suit.
European Commission President Jose Manuel Barroso called it "the most ambitious package ever agreed by any commission or any group of countries on energy security and climate protection.
The statement also set a 10 per cent minimum target for biofuels in transport to be introduced by 2020 in a cost-efficient way.
Renewables account for less than 7 per cent of the EU energy mix and the bloc is falling short of its existing targets both for low-carbon energy and to cut carbon dioxide emissions.
In an attempt to balance pro- and anti-nuclear power states, wording was added on the contribution of nuclear energy "in meeting growing concerns about safety of energy supply and CO2 emissions reductions while ensuring that nuclear safety and security are paramount in the decision-making process".
The Brussels summit outcome will form the basis of the EU's position in international talks to find a replacement to the UN Kyoto Protocol, which expires in 2012.