CDM Executive Board and HFCs

Legal assistance paper

All reasonable efforts have been made to ensure the accuracy of this information at the time the advice was produced. However, the materials have been prepared for informational purposes only and may have been superseded by more recent developments. They do not constitute formal legal advice or create a lawyer- client relationship. To the extent permitted any liability is excluded. Those consulting the database may wish to contact LRI for clarifications and an updated analysis.

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Date produced: 01/03/2010

1. Would submitting a proposal to amend the Approved Methodologies via a DOE (Designated Operational Entity) improve the likelihood of the request being granted?

2. Does the EB analyze the request if it is based on an example project rather than a real existing one?

3. What should be done to get HFCs governed by Montreal Protocol? Does the submission have to go through a Party to the Protocol or could the civil society propose amendments? 

4. Is it true that new plants are not eligible under the current CDM rules?

1. The CDM Modalities require that all revisions of methodologies to be submitted through a DOE. The UNFCCC confirms this by stating “only DOEs can submit a new request”.

There have been four previous revisions to this methodology. It appears that all the previous  revisions have been proposed by project participants in relation to the HFC Decomposition Project in Ulsan, Republic of Korea.

Our preliminary review of requests for revision of methodologies on the UNFCCC website indicates that most successful requests are submitted by DOEs and that most are associated with particular projects.

Based on the CDM Modalities and practice, we consider that generally, submitting requests through a DOE may increase the likelihood of a request being granted. However the request in this case is distinguishable in that it does not relate to the operation of a specific project but is more directed at achieving broader environmental goals under the Protocol.

A DOE may nevertheless be able to strengthen the technical aspects of the request and if the DOE has experience in drafting such requests for revisions then this may increase the likelihood that the request would be approved.

2. The CDM Rules imply that it is intended that revision requests are based on real projects rather than example projects. The following in particular makes this clear:

(A) Paragraph 38 states that “if the DOE determines that the project activity intends to use a new baseline or monitoring methodology, as referred to in paragraph 37(e) (ii) it shall, prior to a submission for registration of this project activity forward the proposed methodology, together with the draft PDD, including a description of the project and identification of the project participants to the Executive Board for review“.

Although paragraph 38 applies specifically to new methodologies, paragraph 39 states that a revision of a methodology shall be carried out in accordance with paragraph 38.

It is arguable that the EB would be entitled to refuse to review the revision request if this was based on an example project and not a real project. This is because the proponent would not be able to submit the requisite documents as per paragraph 38, such as draft PDD.

There is nothing however in the CDM rules requiring the EB to refuse to consider an example project (and the EB is not “legally bound” by its rules in any event), and it is likely to exercise its discretion on a case by case basis.

3. In order to have HFCs governed by the Montreal Protocol it is likely that an amendment to the Protocol would be required. Article 9 states that:

any Party may propose amendments to this Convention or to any protocol… 

Amendments to this Convention shall be adopted at a meeting of the Conference of the Parties. 

Amendments to any protocol shall be adopted at a meeting of the Parties to the protocol in question“.

Paragraph 3 of Article 9 states that Parties shall make every effort to reach agreement on any proposed amendment by consensus, however if all efforts of consensus have been exhausted then amendment to the Convention shall at last resort be adopted by a three-forths majority vote (or two-thirds in the case of the Protocol).

We consider that civil society could have most impact on the process through attending workshops hosted by the Ozone Secretariat and by working with Parties to the Protocol so that they can put forward amendments. An example of such a workshop was the workshop proposed in Decision XX/8 of the 20th Meeting of the Parties, in which the COP requested the Ozone Secretariat host a workshop to discuss the cost, benefits, and options for regulating high-GWP HFCs based on the experience of the Montreal Protocol and to report to the Parties no later than June 2009.

It is also possible for civil society to participate in the COP / MOPs by being an observer. As per Article 11 of the Montreal Protocol, any non-governmental body, qualified in fields relating to the protection of the ozone layer which has informed the secretariat of its wish to be represented at a meeting of the Parties as an observer may be admitted unless at least one third of the Parties present object. The admission and participation of observers is subject to the rules of procedure adopted by the Parties.

4. The current version of AM0001 states that the methodology is only applicable if the “HCFC-22 production facility has an operating history of at least three years between beginning of the year 2000 and the end of the year 2004 and has been in operation from 2005”. Thus under this methodology it is true that new plants are not eligible under the current CDM rules.