HFC Amendment to Montreal Protocol Edges Closer

14 April 2016

Talks for a deal geared towards phasing down climate-warming hydrofluorocarbon (HFC) emissions held last week in Geneva, Switzerland, reportedly made good progress on addressing thorny issues, such as how to deal with different capacity levels and access to alternative technologies. Participants also discussed the role of intellectual property rights and financial support. 

“This week’s progress demonstrates that an HFC deal can be reached this year. While the strength of that deal hangs in the balance, the opportunity is there for another big win for climate protection in 2016,” said David Doniger, director of the Natural Resources Defense Council’s (NRDC) climate and clean air programme, in a blog post.

The meeting did not, however, have the opportunity to consider four draft amendment proposals that have been put forward over the last year or consider other issues such as the imposition and timing of a trade ban on HFCs.

“Overall, in this conference, progress has been made…But it was a disappointment that parties could not find solutions to all challenges,” wrote Rakesh Kamal, programme officer at the Centre for Science and Environment, at the close of last week’s talks. Kamal added that much was anticipated from meetings scheduled this year.

After over five years of deliberations, parties to the Montreal Protocol on Substances that Deplete the Ozone Layer agreed last November in Dubai to negotiate an HFC amendment in 2016, including by identifying solutions to challenges associated with this transition. (See BioRes, 11 November 2015)

HFCs – used primarily as coolants in refrigerators and air conditioners – were previously identified as a suitable alternative for hydrochloroflurocarbons (HCFCs) that are targeted for elimination by the Montreal Protocol.

However, while HCFCs are ozone-depleting substances (ODS) responsible for thinning the earth’s protective ozone layer, HFCs are greenhouse gases with atmospheric warming potential over 10,000 times more powerful than carbon dioxide.

In order to tackle HFCs, countries will need to identify new coolants or alternative technologies, and ensure rapid scale-up by the time a ban comes into effect.

Exemptions, funding

Parties reached tentative agreement last week on a four-year grace period from the HFC phase-out for the world’s hottest countries.

This will apply to developing nations, referred to as Article 5 countries, where average temperatures hit 35 degrees Celsius for at least two months a year over a decade. The exemption, which can be renewed if needed, would cover 34 countries.

Supporters of the exemption argue that it is necessary to allow for the development of alternatives able to cope with high ambient temperatures and that these are not yet widely available.

While several campaign groups had cautioned against providing too much leniency if the deal is to be effective, reports from last week’s meeting suggest that consensus on the exemption will prove key to securing agreement on the overall amendment.

According to Steve Seidel from the Center for Climate and Energy Solutions (C2ES), the HFC emissions covered by the exemption will only add up to a relatively small portion of the global total.

Parties also agreed by Friday to revise, within one year after adoption of the amendment, rules governing the Montreal Protocol’s funding platform in order to help poorer countries cope with the HFC phase-out.

Activities supported by the multilateral fund will include capacity-building and training for handling HFC alternatives, institutional support, licensing, reporting, demonstration projects, and national strategy development.

Further discussion on other financial issues will continue later this year, with some hurdles arising during the week around estimating funding levels before having agreement on the start date. A technical body has been charged with estimating costs based on schedules proposed in the four proposed draft amendments. 

Sources have said that securing the financial support package will be another essential part of ensuring a successful deal.

Intellectual property rights, trade

Many delegates reportedly said last week that the role of intellectual property rights (IPRs) was an important and potentially sensitive issue in the process.

According to media reports, some countries expressed concern about limited access to patented technology for HFC alternatives, adversely affecting efforts to make the switch. Associated incremental costs linked to patented technology could also have a negative impact on national economies.

According to a paper prepared by the UN Environment Programme’s Ozone secretariat, patent and royalty costs are included in the list of categories of costs eligible for compensation from the multilateral fund.

Reviewing past experiences linked with other phase-outs, the paper also suggests that such costs were directly included in project funding in certain cases and indirectly paid for as part of the overall technology cost in several other instances.

The paper adds, however, that given the number of patents and timing of their expiration on some HFC alternatives, parties may need to consider how existing policies and approaches under the Montreal Protocol could work in this context.

Parties will also have to decide in due course the provisions for trade measures associated with the HFC phase-out. Article 4 of the Montreal Protocol prohibits or restricts parties from trading controlled substances with non-parties. The inclusion of trade provisions in the treaty was designed to provide an incentive for states to become parties to the protocol and subsequent amendments.

However, with successive amendments over the years, parties have applied a degree of flexibility to the start date or implementation of non-party trade measures, taking into account particular circumstances and technologies.

All four current draft HFC amendments address non-trade provisions, but with different timelines and conditions such as the number of ratifications.

Next steps

Montreal Protocol parties will gather from 22-23 July in Vienna, Austria, for an extraordinary ministerial meeting geared towards moving the HFC amendment process forward. An informal preparatory meeting will be held prior to that occasion in order to continue discussions on financing and other matters.

Many parties and stakeholders alike are hoping to secure a text in time for agreement at the 28th Meeting of the Parties (MOP) to the Montreal Protocol to be held in Kigali, Rwanda, in October. 

ICTSD reporting; “Summary of the Thirty-Seventh Meeting of the Open-Ended Working Group of the Parties to the Montreal Protocol on Substances That Deplete the Ozone Layer,” EARTH NEGOTIATIONS BULLETIN, 11 April 2016; “Gulf states win concessions in HFC phase-out talks,” CLIMATE HOME, 11 April 2016.

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