Mixed Signals and Missed Opportunities as India Puts the Brakes on HFC Phase-Down Talks

After a summer of diplomatic progress at the level of presidents and prime ministers, expectations were high that countries would launch negotiations on phasing down the dangerous heat-trapping chemicals called hydrofluorocarbons (HFCs) at meetings of the Montreal Protocol in Bangkok last week.

The leaders of the world’s largest nations unanimously committed at the September G-20 summit to use the Montreal Protocol to phase down production and consumption of HFCs.  President Obama announced bilateral agreements with China’s President Xi Jinping in June and September, and another with India’s Prime Minister Manmohan Singh in September, each committing to phasing down HFC production and consumption under the Montreal Protocol.

Here are the words of the G-20 declaration, which also appear in the Singh-Obama agreement:

We also support complementary initiatives, through multilateral approaches that include using the expertise and the institutions of the Montreal Protocol to phase down the production and consumption of hydrofluorocarbons (HFCs), based on the examination of economically viable and technically feasible alternatives. We will continue to include HFCs within the scope of UNFCCC and its Kyoto Protocol for accounting and reporting of emissions.

Taken together, the world leaders’ announcements raised hopes for the start of negotiations on HFC phase-down proposals at last week’s Montreal Protocol meeting.  In past years, the majority of nations, both developed and developing, had supported such negotiations, but China, India, and Brazil had banded together in opposition.  Now it looked as though the leaders of all three developing giants were ready to move as well. 

But hopes for progress tumbled on the first day when the Indian government unexpectedly backed away from Prime Minister Singh’s commitments.  While China and Brazil showed flexibility, India dug in its heels and reverted to its old position that HFCs should be addressed solely under the climate treaties. 

India took the lead in preventing formation of a “contact group” to begin negotiations on the pair of HFC phase-down amendments proposed by Micronesia and by Canada, Mexico, and the U.S.  Without a contact group, there was no way to start hammering out the technical, financial and other issues involved in negotiating an HFC phase-down. 

The parties managed to agree to continue a “discussion group” on HFC management set up last June.  By the end of the week, the parties agreed to task their Technical and Economic Assessment Panel for more studies on the availability of alternatives, for current and future demand scenarios, and to consider potential costs of avoiding HFCs.  These are all important steps, and they show the strong desire of majority of countries to move forward next year.  But they fell short of expectations that countries would begin real negotiations at this meeting.

A growing chorus of Indian civil society and business voices is expressing disappointment at the government’s stance in Bangkok.  “Embarking on a gradual phase down of HFCs would be a win-win for India,” said Bhaskar Deol, India representative for the Natural Resources Defense Council (NRDC). “But, unfortunately, India has missed an opportunity to take a real leadership role to support business innovation and protect communities from the worst effects of climate change. The time to act is now. India should join other nations in the global phase down of HFCs and actively engage in the Montreal Protocol process.”

The influential Centre for Science and Environment called on India to engage under the Montreal Protocol:  “The Government of India should agree to setup a contact group to discuss the management of HFCs where countries can turn in their submissions on how Montreal Protocol should address control of HFCs.” 

Arunabha Ghosh, CEO of the Council on Energy, Environment and Water, made a powerful case for India’s engagement in an op-ed published last week in two influential Indian newspapers, Times of India and Economic Times.  Ghosh argued:  “Action on HFCs offers some common ground in the protracted climate negotiations, potentially creates commercial opportunities for Indian firms, and allows India to assume the mantle of climate leadership.”  Ghosh methodically rebuts the arguments against Indian engagement. 

To those who claim HFCs are a small issue compared to carbon dioxide, Ghosh answered that both are critical because HFCs are so rapidly growing.  “In 2050 HFCs could account for 20%-40% of the warming attributed to carbon dioxide, if the latter’s levels were held to a two degree Celsius climate stabilisation scenario. In effect, action on carbon dioxide could be negated if HFC growth remains high between now and 2050, thanks to rapid expansion of refrigerant use in air conditioners.”

To those who contend HFCs should be addressed only under the climate treaties, Ghosh noted that the Montreal Protocol has a better track record of delivering Indian firms financial assistance for the transition costs they incur.  “Based on past experience, there is higher chance of getting money through the Montreal Protocol than through the UNFCCC, which has failed to deliver any significant funds for climate activity.”

Ghosh also argued for India to take a leadership position, both to avoid being boxed out by China and the U.S., and to gain credibility and leverage on other pollutants in climate treaty negotiations.  “If we refuse to talk about it, we cannot develop a strategy. Only China and U.S win in that case.” 

And to those who fear foreign chemical firms, Ghosh observed that:

Indian companies are also undertaking research and development for alternative chemicals (such as efficient hydrocarbons) as refrigerants in room air conditioners. Indian car companies are using lower emission refrigerants for cars meant for EU or US markets, where standards are changing. Business opportunity is not a prerogative of only the developed world. Arguing that we should not act on HFCs because someone else invented the alternatives is like saying we should not fly because two American brothers invented the aeroplane. 

Ghosh recommended a five-part strategy for the Indian government, including to “engage with Indian firms, particularly manufacturers of automobiles, home appliances and refrigerants. We need better understanding of the cost of transition, efficiency gains and losses, changing technical standards in export markets, commercial opportunities for Indian-made automobiles and home appliances, and potential patent-related concerns.” 

Other voices are already being heard.  In an editorial called “Climate Confusion,” the Indian business publication LiveMint reprimanded the government’s behavior:  “This paper has argued that India needs to strategize properly before it signs an agreement that can mar its economic prospects. But this is something else: reneging on a commitment is not a strategy at all. It gives the impression that India is not a reliable partner in addressing an important global problem.”

A start on a strategy that makes sense for Indian business is explored in Cooling India with Less Warming, a report issued earlier this year by NRDC, CEEW, and The Energy and Resources Institute (TERI) and the Institute for Governance & Sustainable Development (IGSD).  Examining the fast-growing room and auto air conditioning sectors, the report finds that the Indian and international companies active in India in these two sectors are readying themselves for a gradual HFC phase-down transition.  They are preparing to replace HFCs where they are used now, and to leapfrog over them in many applications that had been expected to adopt them.  The report examines the current and projected state of technology and the needs of Indian for financial assistance through the Montreal Protocol’s Multilateral Fund. 

Hopefully, Indian leaders will quickly reassess its HFC position.  Last week’s obstruction of action under the Montreal Protocol was a false step and a missed opportunity.  An HFC phase-down under this effective treaty still offers the best way forward to serve the needs of India’s domestic businesses, to repair strained relations with India’s international partners, and to protect India against devastating climate change.