BACKGROUND

1. Updates on alternative technologies and international developments in the Refrigeration and Air Conditioning Sectors

2. BACKGROUND • HCFC phase-out in developing countries has started. Short/medium term targets: Freeze in 2013, 10% reductions from 2015, 35% reductions from 2020. • HCFC-22 is the predominant refrigerant used in air- conditioners in developing countries • Consumption of HCFC-22 in manufacturing and servicing of air-conditioners in major developing countries is significant (typically >70% of total HCFC consumption) and growing rapidly

3. BACKGROUND (CONT’D) • UNDP is engaged in HCFC phase-out in the Air Conditioning sector in many developing countries • In many A5 countries, reduction in HCFC consumption in the Air Conditioning sector is essential for compliance with the 2013-2015 control targets, and also in significantly reducing CO2 emissions

4. MARKET FOR AIR-CONDITIONERS • Market for air-conditioners growing rapidly in developing countries • Estimated HCFC-22 based room air-conditioner sales (2009) in key developing countries in Asia-Pacific:

5. MARKET FOR AIR CONDITIONERS (CONT’D) • By 2020, market for air-conditioners in Asia-Pacific could reach >100 million units and sales >US$ 20 billion • Refrigerant charge volumes for new air-conditioners sold in Asia-Pacific (developing countries in 2009) estimated at ~40-50,000 metric tonnes annually(!)

6. TECHNOLOGY • Need for lifecycle management approach in technology selection • Manufacturing • Use • End of Life

7. TECHNOLOGY • MOP Decision XIX/6 urges maximizing climate benefits when phasing out HCFCs • Lifecycle CO2 emissions from air-conditioners are 60-95% indirect and 5-40% direct. In developing countries direct emissions are higher due to local conditions • Both energy-efficiency and refrigerant GWP are critical considerations to maximize climate benefits • Currently there is no perfect alternative for HCFC-22. HFC and HC candidates involve compromises and trade-offs

8. TECHNOLOGY (CONT’D) • R-410A (GWP = 2,088*) has been the preferred alternative in developed country markets since ~2000. • Population of air-conditioners with R-410A is already about 200 million, mostly in developed countries: about 200,000 metric tonnes of R-410A in banks and increasing! • R-410A energy-efficiency performance in general and in high-ambient conditions in particular • Is R-410A a sustainable alternative for minimizing adverse climate impacts? • ____________________________ • * IPCC 4th Assessment Report

9. KEY ISSUES AND CONCERNS • Reducing HCFC-22 consumption in developing countries without clear technology and policy signals, will result in unintended and adverse climate impacts • For example, if developing countries restrict HCFC-22 based air-conditioners (manufacturing or imports), automatic technology choice is likely to be R-410A. • Major developed-country technology providers showing preference for R-410A (e.g. R&D focus on optimizing R-410 systems and components, new products based on R-410A etc.)

10. KEY ISSUES AND CONCERNS • Significant expansion of HFC production facilities • Extensive introduction of high-GWP technologies will lead to rapid increase in population of air-conditioners in developing countries, based on these technologies • Considering prospective developing country markets by 2020, the net climate impact of HCFC phase-out with high-GWP technology, is most likely to be negative! • A better, more forward-looking and climate-conscious approach to alternatives is needed!

11. WAY FORWARD • What can industry do? • Introduce and promote low-GWP, energy-efficient alternatives (R-32, R-290, others) on priority • Support sustained R&D for new, better and safer molecules for substituting HCFC-22, as well as optimized components (e.g. compressors). • Cooperate with MP panels and implementing agencies for sharing and disseminating latest technologies (e.g. demonstration projects, technology workshops)

12. WAY FORWARD • What can governments do? • Support incentives for better alternatives • Support policies that ensure level playing field for the industry players • ‘ • Involve industry in formulation of policies and regulations • Support targeted and clear regulations that take into account GWP and energy efficiency

13. DEMONSTRATION PROJECTS • R-32 technology (UNDP): Commercial air conditioning and heat pumps at Tsinghua Tong Fang, China • Ammonia/CO2cascade technology (UNDP): Low-temperature refrigerating and freezing systems at Yantai Moon Group, China • Projects under implementation with target completion in 3Q2012. • ‘

14. RECENT DEVELOPMENTS • Manufacturing line for R-290 based room air-conditioners commissioned in China in June 2011 (at Gree Appliances, Zhuhai) • Japan and Indonesia announce partnership in June 2011, for R-32 based room air-conditioners. Panasonic will introduce R-32 based room air-conditioners in the Indonesia market from 2014. Indonesia will prohibit manufacturing, assembly and imports of R-22 based room air-conditioners from 01 January 2015. • ‘

15. THANK YOU! Comments, suggestions and questions welcome http://www.undp.org/chemicals/montrealprotocol.htm suely.carvalho@undp.org nandan.chirmulay@undp.org