Major HFCs Climate Opportunity Emerging for India

Significant momentum is building toward major progress on climate change. In a landmark announcement, more than 100 nations signaled strong action by agreeing to an early freeze of highly potent global warming hydrofluorocarbon (HFC) gases. Developed countries and private foundations pledged eighty million dollars to support an early transition in developing economies. More than 500 companies and over 100 subnational governments made strong commitments to an early phasedown of HFCs as well. As nations head to Kigali for the final discussions in a few weeks, the world looks to India to take action. 

In Kigali, countries will come together to agree on a schedule to control the use of highly global warming HFC refrigerant gases under the Montreal Protocol. HFC emissions are rising rapidly, especially in developing countries, where air conditioning demand is skyrocketing. While HFCs do not damage the ozone layer, their global warming effect is up to 15,000 times greater than that of carbon dioxide (CO₂). If started early, a phasedown of HFCs has the potential to shave off half a degree of expected warming by the end of the century—the single biggest step that the world can take to meet our global climate targets.

The agreement next month is critical to upholding the Paris Agreement’s ambition of limiting global temperature rise to 1.5°C. More than ever before, the world needs to come together and build on the ambition signaled by the countries in New York this week. India, in particular, can take this singular opportunity to ensure long lasting benefits for the country including access to new technology and funding from the Montreal Protocol’s Multilateral Fund for making an early shift.

Key elements of the announcement on HFCs in New York this week

• China, European Union, Argentina and the most climate vulnerable countries join the United States in leading more than 100 countries to support an early and ambitious phasedown of HFCs, some showing greater ambition on their previous positions.
• A major financial support package of eighty million dollars is on offer from the developed countries and private foundations starting 2017. This support is offered to developing economies to build institutional strength that will allow for an early phasedown and building programs centered on energy efficiency.
• More than 500 companies have pledged their commitment for supporting an early HFC phasedown and transition to more ozone-friendly, climate friendly and super energy-efficient technologies. And over 100 subnational governments showed that they want such an agreement. 

Significant Opportunity for India

a) Build global consensus to achieve this year’s biggest climate victory

Taking a cue from the ambitious announcements made in New York this week, India can play the role of bringing together the developed and developing economies in an agreement on aggressive phasedown schedules. Countries are already converging on a phasedown schedule for developed countries that may begin as early as 2019. A developing country freeze date is still under debate.

As illustrated by the table, the 54-nation African Group, Pacific Island countries, leading Latin American and Caribbean countries, the United States, European Union, Japan, and other OECD countries are leading in the developing country ambition with a proposal to begin the phasedown in 2021. As per the announcements, other Latin American and Asian countries including China have indicated their willingness to freeze before 2025, a move from their positions as indicated in the table. India, seeking to continue HFC growth for another 15 years, is proposing a freeze that is postponed to 2031. The 10-year gap between the most and least ambitious proposals makes a major environmental difference allowing at least 33 billion extra CO2-eq tons of HFC use—equal to world’s CO2 output for an entire year. 

By leading the countries towards consensus on an early freeze date for developing nations, India can play a key role in bringing the world together, as it did in Paris for the historic agreement in December 2015.  

b) Use early funding to kick start the transition and access new technology to build the economy

To help start that transition early, major governments and private foundations have committed eighty million dollars in new funding that can be made available as early as 2017. This will help developing countries including India to take advantage of this unique opportunity for manufacturers to redesign and optimize equipment for energy efficiency, delivering significant power sector benefits for the country and the growing consumer base in India. The economy can lock-in significant energy savings with greater energy security and energy access that align with the goals of the Indian government.

India can play a leadership role, as one leading Indian commentator pointed out, in ensuring that the Montreal Protocol helps incentivize the dual climate wins from an HFC phase-down and improved energy efficiency.

Companies can also seek funds to cover costs for transitioning to better alternatives in India. Since the technology is rapidly changing, Indian companies can also look ahead and avoid obsolete technology while covering transition costs from the MLF.

In keeping with the research and development announcements made in New Delhi last week, India can also use this additional funding to invest in innovation and be at the forefront of developing new cutting edge technologies.

As my colleague Jake Schmidt highlights, it is critical that developed countries mobilize additional finance to help developing countries with the transition that will occur with aggressive phase-down schedules that will hopefully be agreed next month. Developing countries should insist on this as a part of the final Montreal Protocol agreement. India can play a leadership role in helping ensure that developed countries deliver finance as a part of a strong Montreal Protocol agreement.

c) Leverage the business opportunity and economic benefit

More than 500 major companies and associations outlined that they are supporting an aggressive phase-down of HFCs this year. Companies are showing that they are fully behind efforts to secure the biggest climate win this year and put the world on a safer trajectory to achieve the Paris Agreement climate targets. These companies are reinforcing the clear signs that the market is shifting to air conditioners and refrigerators with reduced impact on the climate. They are showing that they are prepared to help speed that transition.

Building on the ambition signaled by the companies, Indian industry can leverage the opportunity to secure funding from the MLF, and gain access to markets that are opening up in developed countries.  Achieving a strong agreement would be a major win for India and its effort to transition to more modern and environmentally friendly technology. With the future of our only planet on the line, India can play a crucial role in ensuring that all countries come together to fulfill their responsibility and protect the planet for generations to come.