Some background to letter from Exec. Secretary of

Montreal Protocol

Christiana Figueres

March 2007

Basic Facts

• Most ozone depleting substances have been phased out or are in the process

• HCFCs main remaining ODS– Intermediate substance– later timetable for developing countries

• HCFC22 widely used refrigerant in developing countries (not in A1)– HFC23 is by product of HCFC22 production– GWP of HFC23 = 11,700

• Developing countries– HCFCs freeze Jan 2016 at 2015 baseline– Elimination 2040– Schedule set in 1990 (before CDM and accelerated

growth of developing countries)

• Concerns– 2015 baseline is incentive to continue to increase

consumption (consumption=production + imports - exports)

– CDM promotes HCFC22 consumption• Unexpected damage to ozone layer

– Phaseout costs may exceed Multilateral Fund possibilities

CDM Effect(levels are indicative)

• Seven proposals for MOP19 in Sept ‘07

• Options– Lower baseline (e.g. 2010 instead of 2015)– Accelerate the phase out (e.g. 2030 instead of

2040)– Channel effect of CDM

Option 1: Lower the baseline to 2010

Option 2: Accelerate the phase out to 2030

Option 3:Channel the effect of CDM

• New plants allowed, third party gets CERs, revenue used for environmental activities.

• Tech and Ec Assess Panel (TEAP) is requested to analyze scenarios

• Request to EB– Info on volumes of HFC23 expected on the

market– Info on CER price expectations– Collaboration with Ozone Secretariat