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China Agrees to Massive Climate Mitigation

EIA Demands Guarantee that Potent Climate Damaging By-product HFC-23 is Also Eliminated

China has agreed to accept up to US$385 million from the Montreal Protocol’s Multilateral Fund (MLF) for the elimination of its industrial production of ozone depleting substances known as HCFC (hyrdochlorofluorocarbons) and associated by-product HFC-23 in accordance with best practices to minimize associated climate impacts. The Environmental Investigation Agency (EIA), is seeking a phase-out of HFCs, today called on China to follow the lead of HCFC producers in the developed world and guarantee the immediate and continued destruction of HFC-23 in all Chinese HCFC production facilities.

HFC-23 is 14,800 times more damaging to the global climate than carbon dioxide. Numerous scientific studies have documented increasing concentrations of HFC-23 in the atmosphere in recent years which have been primarily attributed to venting of this gas at Chinese HCFC production facilities.

The decision, reached late Friday in Montreal, is a major step in the Accelerated Phase-out of HCFCs, which are not only ozone-depleting chemicals but also potent greenhouse gases. The elimination of the production of over 4.3 million metric tonnes of HCFCs will prevent emissions of 8 billion tonnes of carbon dioxide equivalent greenhouse gas emissions, almost one and a half the total annual emissions from all cars in the world.

“Elimination of China’s production of HCFC’s over the next 17 years is a great win for the environment,” said Mark W. Roberts, EIA’s Senior Policy Advisor. “However, it will be a hollow victory unless China adopts the best practices that prevents any HFC-23 from being vented into the atmosphere.”

In 2007, the Parties to the Montreal Protocol agreed to accelerate the phase-out of HCFCs with developing countries agreeing to reduce HCFC use and production to almost zero by 2030. Under the Montreal Protocol, developed countries fund the incremental costs associated with the ODS phase-outs in developing countries. However with China controlling 92% of the developing world’s HCFC production, discussions on the financial agreement under the Multilateral Fund have been extended and controversial.

According to reports, China will close and dismantle its production lines producing HCFCs for uses controlled under the Montreal Protocol and ensure that any HCFC plants that receive funding will not switch to producing HCFCs for industrial feedstock, a use not controlled by the Montreal Protocol. In order for the climate to truly benefit from this phase-out, China must destroy the HFC-23 by-product produced by all HCFC plants during the phase-out. Additionally, the phase-out does not cover the HCFC production facilities that already produce HCFCs as feedstock, and the concomitant production of HFC-23. China must also assure that best practices are applied and the HFC-23 from this production is also destroyed.

EIA has repeatedly urged the MLF and the Montreal Protocol to ensure that any agreement with China concerning the phase-out of the production of HCFCs guarantee the destruction of HFC-23 from all of the Chinese HCFC facilities. According to the press release issued by the Multilateral Fund, China has agreed to “… coordinate with stakeholders and make best efforts to manage HCFC production and associated by-product production in HCFC plants in accordance with best practices to minimize associated climate impacts.” This stops short of mandating HFC-23 destruction in all plants, but does indicate China’s intent to follow best practice as currently deployed by HCFC producers in developed countries. EIA calls on China to publically pledge to mandate the destruction of HFC-23 from all production.

The agreement to phase-out China’s entire HCFC production sector is a welcome step as EIA has been urging early controls over HCFC production to help combat a growing illegal trade in these environmentally destructive chemicals. Developed countries have a phase-out schedule some ten years ahead of developing countries, and are therefore either at or near the end of their phase-out. In Europe, the production and use of virgin HCFCs is already banned, and countries have until 1 January 2015 to stop the remaining use of recycled and reclaimed HCFCs. In the United States 90% of the production and consumption of HCFCs will be eliminated by 2015. Consequently HCFC prices in Europe, the United States and other developed countries are significantly higher than prices in China and India where they are still being mass produced, setting the stage for a profitable trade for smugglers.

Clare Perry, Senior Campaigner for EIA said today, “we welcome the decision to finance the closure of China’s HCFC facilities which will reduce the likelihood of illegal trade, while reducing 8 billion tons of CO2 equivalent, a greater reduction than the entire first phase of the Kyoto Protocol.”