MONTREAL — The executive committee of the Montreal Protocol’s Multilateral Fund has agreed to provide China, the largest producer and consumer of HCFCs, an amount up to $385 million for the complete elimination of its production of HCFCs by the year 2030.

China has not only agreed to retire its current HCFC production capacity but will also retire surplus production capacity that is currently not utilized. HCFCs, in addition to being the last remaining ozone depleting substances controlled by the Montreal Protocol, are also greenhouse gases. According to a statement by the government of China, the total amount of HCFCs to be eliminated over the period to 2030 will prevent the emission of over 4.3 million metric tonnes of HCFCs, equal to 8 billion tonnes of carbon dioxide equivalent greenhouse gas emissions. The Multilateral Fund for the Implementation of the Montreal Protocol was initiated to remove financial barriers that might have discouraged developing nations to agree to the Montreal Protocol. This is potentially the largest project approved so far under the Multilateral Fund since its inception.

China agreed to close and dismantle its production lines producing only HCFCs for uses controlled under the Montreal Protocol and ensure that any HCFC plants that will receive funding do not switch to producing HCFCs as industrial feedstock, a use not controlled by the Montreal Protocol. China also agreed to coordinate with stakeholders and make best efforts to manage HCFC production and associated byproduct production in HCFC plants in accordance with best practices to minimize associated climate impacts.

Over the next four years China will receive $95 million to cover the first stage of its HCFC production phaseout management plan (HPPMP) to assist the country to meet the freeze in HCFC production by 2013 and the reduction by 10 percent by 2015 as required by the Montreal Protocol’s HCFC phaseout schedule. The Multilateral Fund will ensure that China’s performance under the HPPMP is verified before further funding is released.

According to the Multilateral Fund, the latest data shows that China produces 92 per cent of the total HCFC production of developing nations. China’s HCFCs are supplied to the refrigeration, air conditioning, and foam manufacturing sectors and also used as solvents and to some extent for fire protection equipment and the sterilization of medical devices. The Multilateral Fund said the phaseout of HCFC production in China is thus fundamental to ensure the compliance of all developing nations with the Montreal Protocol.

Publication date: 4/22/2013