New EU Legislation on F- Gases motivation, objectives, impacts, - PowerPoint PPT Presentation

New EU Legislation on F- Gases – motivation, objectives, impacts, innovation Arno Kaschl European Commission – DG Climate Action Tel Aviv – 31 March 2014 Climate Action

Relevance of fluorinated gases (F-gases) Gas GWP (AR 4, 100 year) CO 2 1 Methane 25 Nitrous Oxide 298 HFC 134a 1 430 HFC 404A 3 922 HFC 410A 2 088 HFC 125 3 500 PFC 14 7 390 Source: UNEP, 2011 SF6 22 800 Climate Action

Source: European Environmental Agency, 2014 http://www.eea.europa.eu/data-and-maps/indicators/emissions-and-consumption-of-fluorinated/assessment

Source: European Environmental Agency, 2014 http://www.eea.europa.eu/data-and-maps/indicators/emissions-and-consumption-of-fluorinated/assessment

MOTIVATION 2050 Low Emission Roadmap (2011) • Warming should be 100% 100% limited to 2 ° C • EU contribution to 40% Power Sector global effort is to 80% 80% Current policy reduce GHG emissions by 80-95% (1990- Residential & Tertiary level) 60% 60% • Sectoral contributions Industry 40% 40% F-gases are low-hanging fruits for mitigation Transport  Several suitable (safe, energy-efficient, cheap) 20% 20% low GWP alternatives Non CO 2 Agriculture available for most sectors Non CO 2 Other Sectors  Abatement costs are 0% 0% modest 5 1990 2000 2010 2020 2030 2040 2050

Pre-2014 EU F-gas Policy (2006+) for our 28 EU Member States (1) F-Gas Regulation Focus on "Containment" - leak prevention in existing equipment, e.g. leak checks - training and certification of relevant personnel - recovery of gases after use - record keeping and reporting - some bans (2) MAC Directive - bans of HFCs >150 in passengers cars and light trucks Also policies on ecodesign, ecolabelling, waste,…

OBJECTIVES New EU F- gas policy must …  contribute consistently and cost-effectively to the EU 2050 GHG reduction targets  stimulate innovation/improve market opportunities for alternative technologies/ gases with lower GWP  be consistent with international agreements  be efficient and proportionate 7

F-gas emissions in 1995-2050 without measures and the effects of the F-gas Regulation/MAC Directive Legislation from 2006 can achieve a stabilization of Without existing F-gas legislation emissions, reducing emissions by almost 50% With existing '2006 F-gas legislation'  Not sufficient for & MAC Directive EU climate goals, Roadmap Additional potential from New Fgas New Fgas Regluation Regulation will (2015+) decrease emission by >70 Mt CO2eq. (two-thirds of today!) • Source: Schwartz et al. 2011.

New Fgas Regulation from 2015 onwards Two strategies to reduce emissions • Prevent leakage and emissions • Emission prevention and leak checks -> Art. 2 - 4 • Control of by-production -> Art. 6 • End of life treatment of products and equipment -> Art. 7 • Training and qualification -> Art. 8 • Information for users (labelling, product infos) -> Art. 10 • Avoid the use of F-gases • Training and qualification • Ban on new applications -> Art. 9 • Ban on uses -> Art. 11 • Phase-down of HFC supply -> Art. 13 ff.

HFC phase-down – the main novelty  Limit HFC bulk gas & gas inside equipment placed on the EU market  Schedule: freeze 2015, first step 2016, reduction of HFC supply by 79% in 2030 (in CO 2 equivalent)  Baseline: reported 2009-2012  Quota allocation based on historical sales and new entrants reserve  Monitoring: Ex post, Independently verified reports

New EU F-gas proposal: Adoption European Parliament Council of the EU 754 Members Ministers from all directly-elected EU Member States Political Agreement reached in December 2013 European Parliament adopted on 13 March 2014 Will be in force from May 2014, apply from 2015!

IMPACTS Environment : By 2030 reduction of >70 Mt CO2 eq. or two-thirds compared to 2005. Proposal fully consistent with EU Low Carbon Economy Roadmap Economic : GDP impacts +0.006 to – 0.009%. Conservative estimation based on today's (2010) costs and availability of alternatives Social : -16.000 to +7000 jobs. No safety/occupational/health risks. European Commission, 2012, Impact Assessment http://ec.europa.eu/clima/policies/f-gas/legislation/docs/swd_2012_364_en.pdf Climate Action

Summary expected emission reductions [Mt CO2 eq.] Achieved Estimate Estimate Estimate (2010) 2020 2030 2050 Fgas Regulation 842/2006 4 33 42 80 MAC Directive 0 13 50 2006/40/EC New Fgas Regulation - 25 75 87 (xxx/2014) Σ 4 71 155 180 Cumulative emission savings by the new Fgas Regulation alone amount to 0.63 Gt by 2030, and 2.4 Gt by 2050. Total cumulative savings of all 3 pieces of legislation are estimated to be 1.5Gt by 2030, and >5Gt by 2050. Climate Action

Abatement Costs EU-27 MACC emission reduction vs. WM scenario 2030 Marginal abatement cost curve 150 100 € / tCO 2 eq 50 0 0 20,000 40,000 60,000 80,000 -50 • Source: Schwartz et al. 2011. ktCO 2 eq • Marginal abatement costs: 49 € / ton CO2 eq. • Average abatement costs: 16-17 € / ton CO2 eq. 14 Climate Action

Economic effects Detailed economic modelling • Effects are small , but vary by sector • (Small) direct positive effects on manufacturing • (Small) direct negative effects on energy sector (due to higher energy efficiency of alternatives) Different market players: F-gas producers, equipment manufacturers, importers/ exporters, service companies, end users.. 15 Climate Action

Economic effects: Competitiveness • Effects on competitiveness are small • Indirect effects e.g. on retail sector are marginal • Effects on consumer prices are marginal, 0,00 to -0,01% • Positive effects for innovative companies selling alternative equipment (" green growth ") • No replacement of existing equipment required Investment costs occur only at end-of-life  Burden on retailers (SMEs and micro-enterprises) is kept low • De minimis clauses 16 Climate Action

Other Economic & Social Effects • Administrative costs can be kept low • <0.1% of direct costs to industry for phase-down • Regional effects are small • ca. 1 € per inhabitant higher in Southern Europe due to higher use of AC equipment • Equal treatment for domestic producers and importers  no trade barriers • Phase-down incentivises alternatives globally 17 Climate Action

INNOVATION Approximate GWP Threshold % 2010 HFC for New Product Restrictions in EU legislation RAC Market Ban Demand 1400 2500 150 700 Domestic refrigeration 0.2% banned from 2015 (GWP>150) Commercial Small Hermetic 0.2% banned from 2020 (>2500) and 2022 (>150) banned from 2020 (>2500) Commercial Condensing Units 4% Refrigeration Commercial Multipack 33% banned from 2020 (>2500) and 2022 (>150) [allowing cascades with GWP<1500] Transport Refrigeration 1% Industrial Small / Medium DX 8% banned from 2020 (>2500) Industrial Large DX 3% banned from 2020 (>2500) Industrial chillers 1% banned from 2020 (>2500) Industrial flooded 0.1% banned from 2020 (>2500) Key to Traffic Lights Based on work by Ban suitable (but may need small number of exemptions in some sectors) SKM Enviros Ban may be suitable for part of sector, but more commercial development needed Ban not suitable at this time

Refrigeration options For smaller equipment (e.g. domestic fridges, standalone units), suitable alternatives are fully available, e.g. hydrocarbons are a safe, more energy-efficient alternative Climate Action

Source: Shecco Climate Action

Source: Shecco

Refrigeration options For larger commercial refrigeration, R404a is not cool anymore!  R404a has GWP of almost 4000  There are more energy-efficient options (less costs for endusers!) with lower GWP available, e.g. • R407 series as a drop-in solution (supermarkets in UK do it voluntarily!) • CO2 in cascades (avoid efficiency issue under high T!) <> CO2 transcritical Climate Action

Source: Shecco

Source: Shecco

Approximate GWP Threshold for New % 2010 HFC Product Ban Restrictions in EU legislation RAC Market Demand 1400 2500 150 700 Small portable units 1% banned from 2020 (<150) banned from 2025 (<750) Air-Conditioning and Heat Pumps Split systems 20% Packaged systems 0.4% VRF systems 2% Small and medium chillers 6% Large chillers 2% Domestic hydronic heat pumps 1% Other heat pumps 1% MAC: cars and vans 10% banned via MAC Directive (2011 for new car types, 2017 for new cars) MAC: large vehicles 7% Key to Traffic Lights Ban suitable (but may need small number of exemptions in some sectors) Based on work by Ban may be suitable for part of sector, but more commercial development needed SKM Enviros Ban not suitable at this time

Approximate GWP Threshold for New Product Ban Restrictions in EU legislation RAC Market 1400 2500 150 700 XPS banned from 2020 (>150) Foams Others incl. PU banned from 2023 (>150) For novelty use banned from 2009 (>150) Aerosols For technical use banned from 2018 (>150) HFC-23 banned from 2016 Fire protection Key to Traffic Lights Based on work by Ban suitable (but may need small number of exemptions in some sectors) SKM Enviros Ban may be suitable for part of sector, but more commercial development needed Ban not suitable at this time