TheMontrealProtocolandItsImplicationsforClimateChange

October2009

EXECUTIVESUMMARY

Inthecontextofinternationalenvironmentaltreaties,theMontrealProtocolhasseenunparalleledsuccess.Ratifiedby
almost every country in the world, and with both the developed and developing world broadly achieving their
productionphaseouttargetsforozonedepletingsubstances(ODSs),theagreementisontracktosignificantlyreducea
majorenvironmentalandhealththreat.Stratosphericozoneisexpectedtoreverttopre1980slevelsduringthesecond
halfofthiscentury,achievingtheprimarygoaloftheprotocol.

Yet the agreement failed to directly address another threat associated with these emissions: global warming. Both
existingODSsandtheirindustrysubstitutes,hydrofluorocarbons(HFCs),havesevereglobalwarmingpotential(GWP)in
somecasesmorethan10,000timesthatofcarbondioxide(CO2),themostprevalentgreenhousegasemittedbyhuman
activities.WhilefocusingontheglobalphaseoutofODSproduction,thetreatyhasdonelittletoaddressexistingbanks
ofODSsorincentivizetheircontrolleddestruction.Thenext20yearswillbecrucialindeterminingtheultimateimpact
ofODSsontheatmosphere.IfODSbanksremainunaddressed,thereisaconsiderableriskthatthesechemicalswillbe
released into the atmosphere within this timeframe, with significant implications for global warming and ozone
depletion. Only if these gases are collected and destroyed or recycled in a controlled, responsible manner can an
environmentalthreatbeconsideredtohavebeenaverted.

The treaty also has been instrumental in accelerating the growth of HFC production because they have no ozone
depletingpotentialandcanbeusedinalmostallthesamefunctionsinindustry.Theindustryisonlynowcompletinga
transferfromsecondgenerationODSstoHFCs,andsotheiratmosphericprevalencecontinuestoriserapidly.TheGWP
ofHFCemissions,bymass,surpassesthatofCO2byafactorofbetween100and12,500,andacollaborative2009study
reported that HFC emissions could account for 9 to 19 percent of projected global CO2equivalent emissions by2050
underthebusinessasusual(BAU)scenario(Veldersetal,2009).

Climatechangepresentsagrowingthreattohealth,theenvironment,andnationalsecurity.EmissionsfromODSsand
HFCsthreatentoundermineeffortsbeingtakentoreduceatmosphericCO2.Consequently,thereisincreasingpressure
for federal, international, or other climate legislation to address the threats posed by existing banks of ODSs and the
growingproductionofHFCs.

INTRODUCTION

ThisissuebriefaddressesthemagnitudeoftherisksposedbyODSbanksandHFCproductionandthestatusofcurrent
U.S. legislation and policy surrounding these issues. Where proposed solutions are widely voiced, these are listed.
However,thesetofpolicysolutionsdiscussedisonlyillustrativeandnotcomprehensive.

WithaworldwidephaseoutofODSproductioninplace,thisbrieffocusesonthefateofODSbanks.HFCvolumes,on
the other hand, are increasing rapidly. Therefore, projections are provided from accredited sources to set out the
businessasusual trajectory to 2050 for HFC production. There are no discernible reasons to oppose the safe
destructionofexistingODSbanksattheendoftheirusefullives.However,therearesignificantimplicationsattachedto
a phasedown of HFC production for the relevant industries and consumers. These are summarized herein. Given
fundamental differences, the report addresses ODS banks and HFC production separately throughout, including what
policiesareproposedandbeingappliedtoundertakeeachdistinctissue.

BACKGROUND

Bythemid1980s,athinningoftheozonelayerthatformsnaturallyinthestratospherewasobservedbyscientistsover
Antarctica. This effect was attributed to the increased atmospheric prevalence of a group of chemicals called
chlorofluorocarbons(CFCs)andcertainothersubstances,commonlyfoundinconsumerproductslikerefrigerators,fire
extinguishersandaerosolcans.Thesechemicalswereleakedintotheatmospherethroughouttheirproductionanduse,
breakingdownozonemoleculesthatforminthestratosphericlayerandabsorbmuchoftheultravioletradiationthat
reachestheEarth.Thisozonedepletionwasshowntohaveserioushealthandenvironmentalconsequencesforhuman
skin and eyes, crops and marine life. As a result, in 1987, world leaders signed the Montreal Protocol, a global
agreement for the phaseout of production of ODS. Since that time, continued scientific study has led to the
strengtheningofthisprotocol,whichhasnowbeenratifiedby196countries1(UNEP,2009).

SPECIFICTARGETSOFTHEMONTREALPROTOCOL

TheMontrealProtocolidentifiedbothfirstgenerationandsecondgenerationozonedepletingsubstances(seeFig.1).
The treaty was designed to restore the ozone layer by ending production of ODSs and by encouraging alternative
substitutesthroughasystemicphaseout.IntheUnitedStates,CongressamendedtheCleanAirAct(P.L.101549)in
1990toprovidealegislativeframeworkforensuringthetargetsidentifiedbythetreatyweremet.

Globally,therehasbeenequallysignificantprogress,andacompletephaseout(includingwithindevelopingcountries)
ofODSsisexpectedtooccurby2040.Assumingthecurrenttrajectoryismaintained,scientistsprojectthattheAntarctic
ozonelayermayreverttopre1980levelssomewherebetween2060and2075(EPA,2007).

AsofSeptember16,2009
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SecondGenerationODS

FirstGenerationODS

Figure1:SourceEPA,RegulatorySummary,UpdatedSeptember11,2008

ODSANDHFC:LIFECYCLEANDGLOBALWARMINGPOTENTIAL

ODSs, namely gases containing chlorine or bromine, and HFCs are synthetically produced. They are contained in
appliances(e.g.refrigerators),chemicalstockpiles,foams,andarereferredtointhisstateasbanks,whichasofyetare
notreleasedintotheatmosphereasemissions.

2% 3%

RefrigerationandAir
Conditioning

10%

Foams
16%

Aerosols
ElectricialEquipment
69%
OtherorUnknown

Figure2:Estimatedintendedusesoffluorinatedgasesreportedbycompaniesin2007(tons),SourceEuropeanUnionDatasheet

Intheory,banksshouldneverbereleasedasemissions,providedstorageintegrityremainsintact,andtheappliancesare
safelydisposedofattheendoftheirusefullife.Inpractice,thisdoesnotoccurinthemajorityofcases.Emissionsrates
varybysectorandbycountry,but,forexampleintheUnitedStatesandEurope,annualrefrigerantleakageratedata
fromover1700fullsupermarketsystemsaveraged18percent(IPCC,TEAP,2005).Totalvolumesstoredinbankscan
thereforereflect,alongwithstoragestandards,ameasureofthepotentialriskofemissions.

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Emissions
UnintentialLeakages

Production

Uses&Banks

EndOfLife

Destruction

Recycle

Figure3:LifeCycleofODSsandHFCs

ODS are regulated under the Montreal Protocol, while HFCs are currently included among the basket of six GHGs2
regulatedundertheKyotoProtocoltotheUnitedNationsFrameworkConventiononClimateChange(hereafterreferred
toastheKyotoProtocol).

The U.S. Environmental Protection Agency (EPA) defines the global warming potential (GWP) of a chemical by how a
givenmasscontributestoglobalwarmingovera100yearhorizoncomparedtothesamemassofcarbondioxide(CO2),
whoseGWPisdefinedas1.0.ODSsandHFCsarepowerfulgreenhousegases,withpotencyupto12,500timesthatof
CO2.

100,000

GWP(100Yr),CO2=1

10,000

CFC11
4750

CFC12
10890

Halon1301
CFC113
7140
6130
Halon1211
1890
CarbonTetrachloride
1400

SF6
22450

HFC23
12240
HFC134a
1320

1,000
HFC152a
122
100
MethylBromide
5

10

CO2
1
1

ODSs
MontrealProtocol

HFCs

OtherGHGs

KyotoAgreement

Figure4:GlobalWarmingPotentialofSelectODSsandHFCs,LogarithmicScale,Source:EPA

Carbondioxide(CO2),Methane(CH4),NitrousOxide(N2O),Hydrofluorocarbons(HFCs),Perfluorocarbons(PFCs),andSulphur
Hexafluoride(SF6)
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ODSBANKSANDPOTENTIALFOREMISSIONS

At this time, there are no regulatory restrictions on emissions of ODSs from existing banks under either the Kyoto or
MontrealProtocols,althoughnationshavedevelopedpoliciesindependently.

Withlittlenewproduction,CFCbanks aloneareestimated todeclinefrom16GigatonsCO2equivalent (GtCO2eq)in

2002 to 8 GtCO2eq in 2015, with most of the decline in the BAU scenario accounted for by emissions rather than
controlledrecovery.ThiscumulativedeclineisbroadlyequivalenttotheentireglobalCO2emissionsresultingfromthe
burningoffossilfuelsin2006.Overthenexttwodecades,thepreventionoftheseODSbanksemissionswouldreduce
thetotalwarmingimpactofglobalanthropogenicGHGemissionsby3to4percent(IPCC,TEAP,2005).

Mostrelevantly,inthenextdecadealone(20112020),itisestimatedthatpracticableandachievableimprovements
toendoflifemeasurescouldreduceemissionsbynearly3GtCO2eq,andimprovementsduringtheirusephasecould
contribute nearly 4 GtCO2eq in reductions (TEAP, 2007). The need for urgent action is clear from the timeline
associatedwiththeseemissions.

ThetotalODSvolumereadilyaccessibleinU.S.equipmentalonewasestimatedin2005tobe1.5GtCO2eq3,reflecting
thepotentialforactiondomestically(CCE,EPA,2007).

CURRENTANDPROPOSEDLEGISLATIONONODSBANKS

Refrigeration,airconditioningandfoamsrepresentthemostreadilyavailableODSbanks.IntheUnitedStates,likemost
developed countries, bans exist on venting ODS, with only licensed technicians able to perform refrigerant recovery
underspecificguidelines.Inthecaseofdomesticappliances,however,nostandardsforrecoveryareinplaceasofyet,
andnoreportingrequirementsexistforrefrigerantrecoveryoperatorsinthecommercialsector(ICF,2008).
IndevelopedcountriesoutsidetheUnitedStates,certainpolicieshavebeenimplementedwhichinclude:

Producer responsibility programs, mandating the recovery of both refrigerant and foam ODS (See Japan, UK,
Germany.TheU.S.hasavoluntarypartnershipprogram)
Producer responsibility programs in which rebates are provided for the return of used refrigerant, which is
subsequentlydestroyed(SeeAustralia,Canada)
Recoveryanddestructionoffluorocarbonsfrommobileairconditioners(MACs),aswellastherecyclingofparts
at vehicle endoflife. In response, industry has implemented a recycling program under which end of life
vehiclesaresenttoregisteredrecoveryoperators,whorecoverODSandarepaidbasedonthenumberofMACs
andquantityofrefrigerantrecovered(SeeJapan)

IntheAmericanCleanEnergyandSecurityActof2009(H.R.2454)(ACES,2009),whichpassedtheHouseonJune26,
2009,certaineconomicincentivesforselectODSrecoveryareconsidered.Thebillallowsforthedistributionofoffset
credits achieved through destruction of CFCs, equal to 0.8 times the number of tons of CO2eq emissions destroyed.
ThesecreditswouldoffsetCO2emissionsthatarenotreducedunderacapandtradesystem,butitlimitsthebuyersof
these offsets to importers and producers of CFC substitutes (namely HFC producers). While these offsets provide a
marketincentivetodestroyCFCbanks,thelimitationsonwhomaybuytheseoffsetsmaydepresstheircost.Criticsof
thisprovisionarguethattheseGHGemissionswouldbemoreeffectivelyregulatediftheseoffsetswereavailabletoall

350milliontCO2eqofCFCs,1050milliontCO2eqofHCFCsand100milliontCO2eqofHalons
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buyers,andsuchaprovisioniscontainedinthebillthatauthorizestheEPAtodothisatalaterdate.ODSgaseswhose
consumptionhasnotbeencompletelyphasedoutinternationally,(exceptforessentialuseorsimilarexemptions),will
notbeeligiblefordestructionoffsets.

A method that appropriately deals with the destruction or recovery of ODS banks while offering the lowest global
warmingimpactisessential.Todothiseffectively,measuresneedtobeimplementedurgentlywithclearstandardsfor
quantifyingandverifyingODSdestructionorrecoveryprojects.

HFCPRODUCTIONANDTHEPOTENTIALFOREMISSIONS

In its 2000 Special Report, the Intergovernmental Panel on Climate Change (IPCC) set out potential scenarios for HFC
emissions, and in 2005, updated its projections of future HFC emissions to account for its rapidly increasing use as a
replacement for CFCs and HCFCs. This latter report estimates that, in a businessasusual (BAU) scenario, direct HFC
emissionswillincrease300percentbetween2002and2015,from0.4GtCO2eqperyearto1.2GtCO2eqperyear.The
buildupofHFCsinbanksiscorrespondinglyprojectedtodevelop400percent,from1GtCO2eqto5GtCO2eq.

Veldersetal,(2009)updatedthesescenariosandpredictedthatthebaselinefor2050globalHFCemissionswouldrange
between5.58.8GtCO2eqperyear.WhileHFCemissionscurrentlyaccountfortheequivalentof2percentofglobal
CO2 emissions, they could ultimately represent anything from 10 percent to nearly 45 percent if CO2 emissions are
successfully mitigated, but HFC production is not addressed in any meaningful way. The source of this growth will
increasingly come from developing countries, whose HFC emissions are projected to overtake those from developed
countriesby2020,andby2050exceedthemby800percent.

Figure5:HFC,ODS,andCO2Emissionsto2050.Source:VeldersetAl,(2009)

Figure 5 represents the relative contributions towards to global warming of various GHGs. ODSs (CFCs and HCFCs)
historically dominated anthropogenic warming impacts, but over the past five years, HFC prevalence has increased.
Goingforward,theclimateforcingattributabletoHFCsisexpectedtoamplify.5Bplacesthisgrowthinthecontextof
globalCO2emissions;historically,HFCemissionswerecomparativelysmall,butgoingforwardtheyarelikelytobecome
a very significant component of GHG emissions, increasingly so if CO2 stabilization plans are realized. And if CO2
mitigationeffortsarenotsuccessful,HFCswillgreatlyexacerbateanalreadybadsituation.

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CURRENTANDPROPOSEDLEGISLATIONONHFCPRODUCTION

HFCsarecurrentlyregulatedinternationallyundertheKyotoProtocolaspartofagroupofsixGHGs,andnotsingledout
for separate regulation. Although they are not regulated under the Montreal Protocol, a recent proposal from the
FederatedStatesofMicronesiaandMauritiuscalledfortheMontrealProposaltobroadenitsmandatetoaddressHFCs
(MicronesiaandMauritius,2009).SupportforthisapproachwasannouncedbyUnitedStates,Canada,andMexico,on
September15,2009.

PolicyoptionstoregulateandpotentiallymitigateHFCproductioninclude:

Regulationslikebindingtechnologicalorperformancestandardsorproductbans
Financial incentives to reduce emissions, production, import or consumption or incentivize collection,
destructionorsubstitutes
Voluntaryagreementswithindustryandnonbindingbestpracticestandards

ItisalsonecessarytodevelopplansforaddressingHFCbanksinthefuture.ForthereasonsdiscussedregardingODSsin
the previous sections, reducing emissions associated with production and consumption of HFCs is not a complete
solution.Awellstructuredphasedown,ratherthanphaseout,thatsupportsintensifiedresearchintothedevelopment
ofHFCswithlowerGWPs,ornewalternatives,isthepreferredactionsupportedbyseveralindustrybodies.

TheAmericanCleanEnergyandSecurityActof2009(H.R.2454)includesprovisionsforHFCstoberegulatedinacap
andtradeprogramseparatefromotherGHGs.Section332ofH.R.2454requiresHFCconsumptiontobephaseddown
to 67 percent of the baseline4 by 2020, and to 15 percent from 2032. Allowances would be distributed through a
combinationofannualauctionsandallocations.Eightypercentofallowanceswouldbeplacedintoaproducerimporter
pool;ofthese,10percentwouldbeauctionedin2012,withtheauctionquotarisingby10percenteachyear,reaching
90percentin2020andremainingatthatlevelthereafter.

IMPLICATIONSOFREGULATINGHFCPRODUCTION

TheindustryisjustnoweffectingaprotractedtransitionawayfromHCFCstoHFCs.AworkableHFCphasedownneeds
to be consistent with availability of substitutes. Piecemeal solutions exist, but there are sectors of industry where
alternatives are not currently available. The most likely substitutes, ammonia and hydrocarbons (HCs), have short
atmospheric lifetimes and are considered to have a negligible effect on global warming if used incrementally in HFC
capacities. These substitutes have drawbacks however, among which is the flammability of hydrocarbons. New low
GWP HFCs are in development and may ultimately present a viable option; however at this stage these are not yet
widelyavailableandthelikelihoodofacomprehensivesolutioniscurrentlyunclear(seeEFCTC,2009&EPEE,2009).

SomeindustrybodiesfeelinclusionofHFCsinageneralemissionstradingschemeisnotappropriatebutthataspecific
scheme for progressively reducing high GWP HFCs in the market would likely stimulate technological developments.
Industryparticipantsalsopointoutthatcertainanalysesonlyconsiderthedirectimpactofemissionsthroughpotential
leakages. The energy efficiency of appliances that use any kind of refrigerant has to date been paramount, and
switchingtoalternativesmaydecreaseefficiencyandincreaseCO2emissionsassociatedwithincreasedenergyusage.
Thisneedstobeconsideredwhentakingaholisticviewtowardsdecarbonization;reversesinefficiencygainsachieved

Between280and370milliontCO2eq,tobedetermined
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bytheseappliancesresultingfromanypoliciesthataddressHFCsmustbetakenintoaccount(seeFischeretal,1991).
Furthermore,regulationofHFCsshouldnotbedetrimentaltothephaseoutofHCFCs,asanumberofcountriesareina
critical phase of transition. The overall goal must be emissions prevention, and the relationship between supply and
emissionsshouldnotbeassumedtobestatic.AnysystemforHFCregulationmaywanttotakeintoaccountpotential
improvementsincontainmentorendoflifedestruction.

Ultimately,affectedpartiessupportregulationofthesectortocontainorreduceHFCemissions,butarekeentopoint
outthataninternationalagreement,adheredtoonaglobalbasis,isvitaliftechnological,environmental,andeconomic
goalsaretobemet.

Authors:DavidSherandAmySauer
Editor:CarolWerner

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transportation,andurbanplanning.

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