Research and Assessment of Socio-economic Impacts when Vietnam ratifies the Kigali Amendment to the Montreal Protocol on Substances that Deplete the Ozone Layer

31.08.2018 | Category: News

The Montreal Protocol on ODS substances, signed on September 16, 1987 in Montreal, Canada, set out measures and obligations to eliminate certain CFCs and halons for developed countries (which Article 5 of the Protocol does not refer to) and developing countries (which Article 5 of the Protocol refers to). The Montreal Protocol has been amended five times, in which most recently the Kigali Amendments were adopted at the 28th Session among the participating parties to the Montreal Protocol on Substances that Deplete the ozone layer in October 2016.

In order to fulfill the obligation to eliminate ozone layer degradation in accordance with international commitments, in January 1994, the Government of Vietnam ratified the Vienna Convention for the Protection of the Ozone Layer and the Protocol Montreal on ODS, at the same time approving the two amendments: London (1990) and Copenhagen (1992), of the Montreal Protocol. In December 2004, the Government of Vietnam approved two amendments, Montreal (1997) and Beijing (1999) of the Montreal Protocol. In implementing the approved international commitments, the Government has assigned the Ministry of Natural Resources and Environment as the focal point and leader of the implementation of the Vienna Convention and the Montreal Protocol. In addition, Vietnam has received technical and financial support from the Multilateral Fund to implement the Montreal Protocol in order to assist domestic firms convert technologies, eliminate the use of ODSs and replace them with use of ozone-friendly and environmentally-friendly substances.

Amendments to the Kigali Supplement to the Montreal Protocol 2016 provide a roadmap for eliminating the production and consumption of hydrofluorocarbons (HFCs). According to the revised Kigali, Vietnam is a group of developing countries and is obliged to eliminate HFCs in accordance with the provisions of the Kigali Amendment and Supplementation when Vietnam ratifies and replaces Kigali. Accordingly, Vietnam will implement a roadmap to eliminate HFCs, stop consumption by 2024 and begin phasing out HFCs from 2029, gradually reducing to 20% consumption levels by 2045. As Vietnam does not produce HFCs, consumption of Vietnam's HFCs is calculated based on imports for use. Kigali's modification would make an apparent impact on a number of areas including: air conditioning production, household refrigeration equipment, commercial and industrial refrigeration equipment, automobile manufacturing and air conditioning transport and public transport, foam production, and related fields.

Viet Nam has implemented the National CFC, Halon and CTC and CFC (NCHP Plan) for the period 2005-2010 and eliminated the consumption of CFC, Halon and CTC from 01 January 2010. With the NCHP, Vietnam has completely eliminated the consumption of 500 tons of CFC, Halon and CTC from 1 January 2010. In case of refusal to participate and implement the Kigali amendment, Vietnam will contribute to greenhouse gas emissions from the use of HFCs approximately 4,607,908 tons of CO2 equivalent by 2020; and about 7,679,847 tons of CO2 equivalent by 2030.

According to experts, participation in the Kigali Amendment and Amendments will have positive effects in protecting the environment and avoiding rising global mean temperatures. However, the analysis concurrently pointed out the environmental and socio-economic difficulties. Specifically, due to the different thermodynamic and safety features of HFC substitutes, no substance is considered "one-size-fits-all," especially in some refrigeration sectors. In addition, Vietnam will face economic problems such as the cost of converting HFCs to climate-friendly refrigerants, leading to higher costs of consumption and maintenance, and a number of enterprises would not have enough equipment for technology transfer. In addition, the negative impact on the risk of fire and toxic gas leak is an issue that the current safety regulations have not been updated in accordance with technological progress. However, experts believe that the conversion of HFCs will bring long-term economic benefits from reducing the investment and operating costs for businesses. Moreover, the positive impact of protecting the ozone layer and repelling global warming is also a great strength that convince most of the businesses in the three areas using HFCs to approve the amendment of Kigali, suggesting that the technology transfer would not have a major impact. However, as conversion costs are not yet available, many companies in the air conditioning and automotive air conditioning sector are looking for financial support and technical advice for the transition process.

Given the specific context of Vietnam's participation in the Kigali Amendment and Supplementation, Vietnam is facing increasing population and economic development leading to increased demand for refrigeration equipment and air conditioning. Without developing alternatives to HFCs and the use of more energy-efficient equipment, economic development will undoubtedly put significant pressure on the implementation of the National Strategy on Climate Change and Strategy of green growth. Therefore, the Government of Vietnam is recommended to approve the amendment of Kigali to strengthen the management of HFCs, accelerate the elimination and replacement of HFCs in line with the national targets for energy conservation and reduce greenhouse gas emissions. In order to achieve this objective, some additional recommendations were made such as: development of mechanisms and policies to support implementation; make use of international financial support; apply strict procedures when evaluating technology; promote communication, information sharing and technical cooperation; and selection, tracking and management of monitoring indicators.