Instrumentation of HFC-23 emission reduction from the production of HCFC-22

Numerous Parties to the Protocol have expressed their fears that inclusion of this type of projects under the CDM will generate such high income that it would create a perverse incentive to invest in new HCFC-22 capacity or to expand the production of HCFC-22 in existing plants with the aim of generating additional CERs. The dispersive use of HCFC-22 is regulated under the Montreal Protocol, with production and consumption not being restricted until 2015 in developing countries.

Current projections indicate that production of HCFC-22 will increasingly shift from the developed to the developing countries, with an overall growth in production of 30% between 2005 and 2015, potentially leading to additional HFC-23 emissions of 90 Mt CO2-eq. per year. Given these relative high emissions and the availability of a technology (thermal oxidation) that reduces these emissions by over 90% at relative low costs ranging from 0.2 to 0.6 US$/tCO2, HFC-23 by-product emission reductions can play an important role in climate change mitigation.

The challenge is to find a framework that both supports the widespread implementation of this reduction option, and at the same time reduces any negative side-effects such as the disturbance of HCFC-22 markets and/or additional emissions of ozone depleting substances (ODSs) and greenhouse gases (GHGs). This framework could be found either within or outside the CDM, as discussed in this report.