Kigali Amendment

Will the US Ratify the Kigali Amendment in 2018?

I’ve seen quite a bit of articles published on this topic over the past month or so. Some of them stated that the United States was already in the process of ratifying the Kigali Amendment and other articles stated that the US wasn’t even considering ratification. The only sources that I have seen are from lower ranking members of the State Department. And I hate to say it, but the current administration has had conflicting messages before from their departments and the Executive leadership. What is the Kigali Amendment? Why is it important that the US ratify? How will it affect the industry? Let’s find out!

The Kigali Amendment

In a meeting in October of 2016 that took place in Kigali, Rwanda negotiators from more than one-hundred and seventy countries met together  for many days and nights until they all finally came to an agreement on HFC refrigerants. The reason this is called an amendment and not a treaty is because this is an addendum to the famous Montreal Protocol from the 1980’s. While this Kigali Amendment does not have to do with Chlorine or the Ozone layer the governments tacked this on as well instead of making a new treaty.

This amendment has been in the making for seven years and there have been numerous meetings over the years. The latest meeting that took place in Rwanda was where the agreement was finally agreed upon and signed. Since this was an amendment to the Montreal Protocol treaty there was no need for the United State’s Senate to review the documents. Instead, it was voted on by the numerous countries and passed without any involvement of the United State’s lawmakers. It didn’t mater that the last time this treaty was voted on was during the Reagan administration. They used the loophole and got around it.

Under the signed agreement developed countries, including the United States, must reduce their use of HFC refrigerants by ten percent by 2019 from 2011-2013 levels, and then by eighty-five percent by 2036. Along with this developed countries will also have to comply with a freeze of HFC consumption levels in the year 2024. By the late 2040’s all developed countries are expected to consume no more than fifteen to twenty percent of their baselines.

Another grouping of developing countries which include China and numerous African countries have committed to starting their transition in 2024. In these developing countries a reduction of ten percent should be achieved by 2029 and will be extended to eighty percent by 2045. A third grouping of countries which include India, Pakistan, and many Middle Eastern countries, must begin their process in the year 2028. Their target is to reduce their usage by ten percent by 2032 and then by eighty-five percent by 2047.

To top it all off the richer countries, including the US, will be expected to help finance the transition on the poorer countries. The cost is expected to be in the billions and will consist of grants for research for affordability, more efficient technology, and the development of new alternative refrigerants. The exact dollar amount and what we will be spending it on has not yet been determined. There is another meeting scheduled for 2017 that will provide more details.

Will They or Won’t They?

“Judith Garber, the principal deputy assistant secretary, at the Bureau of Oceans and International Environmental and Scientific Affairs, confirmed that the US supported the Kigali Amendment and had started the procedures necessary to ratify.” – Source. She continued to say that there is not an established timeline on when the United States would adopt the amendment. As I stated before this is not a higher ranking Trump Administration personnel. I honestly don’t know if we can take her word for this or not. Nothing against here, I’m just pointing out that this kind of thing has happened before.

I should mention that earlier this year the Trump Administration pulled out of the Paris Climate Accord. According to the administration this was due to the costly expenditures that the Paris Accord would instill on the United States. There is talk that we may have a repeat of this withdrawal on the Kigali Amendment. There is a key difference here though. With the Paris Accord there were many industries that were against it mainly due to the new taxes and regulations that would be forced upon them. With the Kigali Amendment all of the major players are in favor of it. This includes A-Gas Americas, Hudson Technologies, Honeywell, & Chemours. I’m sure there are others out there as well. It would seem that with all of these major companies backing the amendment that the Trump Administration would adopt it. The other side of the coin here is that the US, along with other wealthier countries, will have to pay billions of dollars to aid less fortunate countries to transition to achieve the Kigali agreement’s goals. To me this clause right here would be enough to kill it for Trump. He is not a fan of foreign aid. Will he or won’t he though? It’s a wildcard. The only thing I can use here as a type of barometer is the current court battle on the EPA’s 2015 SNAP Rule 20.

In August of 2015 the EPA announced Rule 20 to SNAP. This rule announced and scheduled the phase outs of various HFC refrigerants including some of the most popular ones like R-134a and R-404A. Up until the summer of 2017 everyone took this new rule as the law of the land and were planning accordingly. Then, in August of 2017 a Federal Court ruled against the EPA’s new Rule 20. This ruling against caused the rule to be overturned instantaneously and caused havoc for a few weeks in the refrigerant industry.

A few weeks later in September of 2017 an appeal was filed on this ruling by Honeywell and Chemours. Remember how I mentioned them earlier in favor of the Kigali Amendment? Well here they are again fighting for HFC’s to be pushed out. Now, I believe they have their own ulterior motives but I won’t get into that now. This appeal that they filed put a stay on the court’s ruling in August and basically put us back to where we were before August of 2017. So, the local HFC phase outs in the US are still on schedule. Everything is waiting on the next court ruling where a decision will be made on the appeal.

Depending on what decision comes before the other will be a great indicator on what the other decision will be. Confused? So am I. Let me put it like this if the court rules in favor of the EPA, Honeywell, & Chemours and keeps the EPA’s phaseout of HFCs then the US will be ratifying the Kigali Amendment. However, if the court rules against the EPA and strikes down the HFC phase out then I could easily see the US backing out of the Kigali agreement. If we have a Kigali update before the SNAP Rule 20 update then I could see the same thing happening but in reverse.

Conclusion

Regardless if the United States moves to adopt the Kigali Amendment in the near future or not we should all know that the days of HFC refrigerants are numbered and their time is coming up shortly. Depending on what refrigerant you work with you will be affected earlier then some of the other guys. If you are a 404A guy then chances are you’ve already started to see some of the changes either moving to Hydrocarbons or to new HFOs. R-134a is only a few years away here in the States and is already banned in the EU. While R-410A is still a ways away I wouldn’t get too comfortable. If I was to put a date on it I would say 2025 would be the start of a 410A phase out. The world is changing for refrigerant… again. Buckle up and get ready for the ride!

Thanks for reading and if you haven’t checked it out yet check out our new community forums dedicated to anything refrigerant!

Alec Johnson
RefrigerantHQ

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