Annex III: Statement by the Chair of the Executive Committee of the Multilateral Fund for the Implementation of the Montreal Protocol on the work of the Executive Committee, the Multilateral Fund secretariat and the Fund’s implementing agencies
*Mr. President, distinguished delegates.
On behalf of the Executive Committee of the Multilateral Fund, I am pleased to report to the Parties on the relevant decisions taken since the Thirtieth Meeting of the Parties in 2018.
In my report I will present some of the significant achievements focusing on ongoing work related to HCFC phase-out; on matters related to monitoring, reporting, verification and enforceable licensing and quotas systems, including the increase in global emissions of CFC-11; and further development of the policies in respect to the Kigali Amendment. I draw your attention to document 31/9 which includes full information on policy matters; projects, their implementation and monitoring; and business planning, financial and administrative matters.
In the period under review, the largest part of the Executive Committee’s work continued to be focused on monitoring the implementation of HCFC phase-out management plans, referred to as HPMPs, and an HCFC production phase-out management plan, referred to as an HPPMP. The ongoing HPMPs for 144 Article 5 countries1 will address approximately 61.5 per cent of the HCFC consumption baseline, including the conversion of almost all of the foam-manufacturing enterprises and a significant number of the air-conditioning manufacturing enterprises, mainly to low-GWP technologies. Through their approved HPMPs, all countries are continuing to address the refrigeration-servicing sector.
The Executive Committee allocated a considerable amount of time of its meetings to in-depth discussions of the issue of monitoring, reporting, verification and enforceable licensing and quotas systems, as well as the increase in global emissions of CFC-11.
Following the Parties’ discussions and in response to their decision XXX/3, the Executive Committee discussed a document that outlined the related Fund policies and procedures with emphasis on the regulatory framework established by Article 5 countries under the Multilateral Fund; the relevance of the institutional strengthening projects through which funding has been provided to the national ozone units; the mandatory reporting on consumption and production of controlled substances and the consistency of the reported levels of consumption and production; the monitoring and evaluation activities; the conditions in multi-year agreements that need to be met before releasing funding tranches; the roles and responsibilities of the bilateral and implementing agencies; the implications of non‑compliance with the Agreements; and the role of the UNEP’s Compliance Assistance Programme in providing compliance assistance to Article 5 countries, and the tools, products and services that it has developed for customs and enforcement officers.
The Committee further considered a document which contained an overview of current monitoring, reporting, verification and enforceable licensing and quota systems, including the requirements and practices of the systems for reporting back to the Executive Committee that had been developed with support from the Multilateral Fund as well as ways to further strengthen the relevant procedures, systems and frameworks.
The two documents were made available to the Parties at their Forty-first meeting of the Open-ended Working Group, and the Committee will consider this matter again at its 84th meeting, taking into account any decisions that the Parties might take at this Meeting.
Mr. President, at its 83rd meeting, the Committee extensively discussed the issue of unexpected emissions of CFC-11 based on a series of reports including in relation to monitoring, reporting, verification and enforcement systems in China. The Committee welcomed a number of regulatory and enforcement actions to be undertaken by the Government of China, and noted that the Government would undertake additional steps in support of its enforcement actions and consider a number of suggestions intended to supplement and augment its regulatory and enforcement actions. These suggestions include engaging a non-governmental consultant to carry out a study to determine the regulatory, enforcement, policy or market circumstances that might have led to the illegal production and use of CFC-11 and CFC‑12. The Government of China undertook to report to the 84th and 86th meetings on the progress in implementing these activities.
With regard to the development of the policies related to the implementation of the Kigali Amendment, the Executive Committee focused its deliberations on the further development of draft cost guidelines for funding the phase-down of HFCs, energy efficiency, enabling activities for the phase-down of HFCs, the consideration of HFC investment project proposals to gather information on incremental costs, key aspects related to HFC-23 by-product control technologies and the level and modalities of funding for HFC phase-down in the refrigeration servicing sector.
- In continuing its deliberations on the cost guidelines, the Executive Committee focused on the starting point for sustained aggregate reductions in HFCs for the consumption and production sectors, the units to be used to measure the reductions and the methodology for setting the starting point, as well as how the interim use of high-global-warming potential technologies should be treated in the relation to the starting point for reduction in consumption. The Committee agreed on a basis for continuing its discussions on the cost guidelines at the 84th and future meetings, including on the matter of disposal of controlled substances, in light of the final report on the evaluation of pilot demonstration projects on ODS disposal and destruction.
- The Committee discussed a number of matters related to energy efficiency, such as: the way to operationalize paragraph 16 of decision XXVIII/2 and paragraph 2 of decision XXX/5, where the discussions resulted in a well-advanced draft recommendation as the basis for further consideration at its meeting in December; information on relevant funds and financial institutions mobilizing resources for energy efficiency that might be utilized when phasing down HFCs; and a report of the Technology and Economic Assessment Panel on issues related to energy efficiency. The Committee will continue its deliberations at its 84th meeting.
- The Committee has so far approved funding for enabling activities in 131 Article 5 countries, noting that those countries that had not yet ratified the Kigali Amendment submitted a letter indicating the intent of the Government concerned to make best efforts to ratify the Kigali Amendment as early as possible. In implementing these activities, the Committee provided flexibility for Article 5 countries to also undertake a number of activities related to energy efficiency using the funding already approved, as was decided by the Parties in decision XXX/5. It is expected that these activities will be completed by June 2020 and final reports submitted to the Committee within six months of the project completion highlighting lessons learned.
- In addition to the six HFC investment projects approved at previous meetings, at its 82nd meeting, the Committee approved three projects to convert enterprises manufacturing products and equipment in the foam and refrigeration sectors.
- The Committee had several discussions on options for controlling HFC-23 by-product emissions. At its 83rd meeting, the Committee started the discussion of one investment project proposal to control HFC-23 by-product emissions, and approved funding for preparation of a project proposal for the control of HFC-23 by-product emissions in the HCFC production sector. The two project proposals will be discussed at the 84th meeting.
- Discussions on the level and modalities of funding for HFC phase-down in the refrigeration servicing sector, which started at the 80th meeting, continued. At its 82nd meeting, the Committee discussed a preliminary document on all aspects related to refrigeration servicing sector that support the HFC phase-down and requested the Secretariat to prepare, for the 85th meeting, an analysis of the level and modalities of funding, taking into account the flexibility that Article 5 countries had in implementing their servicing sector activities and the activities in their HPMPs.
- With regard to the fast-start support for the implementation of the Kigali Amendment, provided voluntarily by 17 non-Article 5 parties, I am pleased to report that all of them had paid their contributions, totalling approximately US $25.5 million, by the 82nd meeting, and that all the funds had been disbursed by the 83rd meeting mainly for implementation of enabling activities for Article 5 group 1 countries, and for a few stand-alone HFC investment projects.
Work of implementing agencies
I would like to briefly address the main achievements of the implementing agencies of the Multilateral Fund during this reporting period, which were requested by the Committee to apply their corporate gender policies in the preparation and implementation of projects funded by the Multilateral Fund.
UNDP has continued assisting 47 countries with the implementation of HPMPs. With regard to the Kigali Amendment, UNDP has provided support to 16 countries with their enabling activities and to another five countries to develop HFC investment projects. UNDP has also continued to enhance the capacity building of Article 5 countries. For example, in May 2019, UNDP organized a workshop on HFC alternatives, which brought together participants from 20 Article 5 countries and experts to discuss challenges, opportunities and solutions to effectively implement the Kigali Amendment.
UNEP, through its OzonAction Compliance Assistance Programme, assists all Article 5 Parties with meeting and sustaining their Montreal Protocol commitments. It assisted 102 countries with the implementation of HPMPs, 104 countries with institutional strengthening projects, and 90 countries with HFC enabling activities in support of the Kigali Amendment. UNEP's current focus includes strengthening of national monitoring, reporting, verification and enforcement systems through policy measures, training of customs and enforcement officers, as well as regional networking. UNEP continues supporting the refrigeration servicing sector to safely and smoothly transition to new technologies. UNEP also builds the capacity of new national ozone officers to efficiently assume their new responsibilities.
UNIDO is currently implementing HPMPs in 72 countries, institutional strengthening projects in eleven countries and HFC enabling activities in 31 countries, as a result of which, a number of Article 5 parties have already ratified the Kigali Amendment. Furthermore, UNIDO is implementing four HFC investment projects. Seven country-level projects and two regional projects are undertaken to demonstrate climate friendly and energy-efficient alternative technologies to HCFCs, trans-critical CO2 refrigeration technology for supermarkets, refrigerant quality and feasibility study on district cooling. UNIDO organized a workshop “Kigali in action” that brought together national ozone units and provided an opportunity for sharing experiences and learning from each other.
The World Bank is currently assisting its partner countries in implementing their HPMPs, valued at nearly US $190 million, to reduce, as a priority, HCFC consumption at the enterprise level. A key goal in the World Bank country engagement is sustainable phase-out, which is why the Bank continues to focus on project design and preparation where country context and desired results are framed by due diligence, quality assurance, and risk management requirements. This establishes a system for countries to track and monitor project progress through completion. The Bank has also delivered technical assistance and advisory services for ratification of, and initial compliance with, the Kigali Amendment in three countries, through enabling activity funding.
Mr. President, distinguished delegates.
I would like to thank the Parties for their strong commitment to the implementation of the Montreal Protocol, and in particular their efforts to bring forward the activities aimed at the implementation of the Kigali Amendment. I would also like to take this opportunity to express my sincere appreciation to the Chair and members of the 2018 Executive Committee and my fellow members of the 2019 Executive Committee, the Fund Secretariat, and the bilateral and implementing agencies, for their continued hard work and dedication to our common goals.
* The statement is presented as received, without formal editing.
1 Except the Syrian Arab Republic.