Ozone-depleting Substances and Halocarbon Alternatives Regulations: consultation 2019

Official title: Proposed amendments to the Ozone-depleting Substances and Halocarbon Alternatives Regulations: 2019 consultation document

Introduction

This consultation document has been prepared to inform interested parties and solicit feedback on proposed amendments to the Ozone-depleting Substances and Halocarbon Alternatives Regulations (the regulations).

The objectives of the proposed amendments are:

• to revise the hydrofluorocarbons (HFCs) consumption baseline and
• to allow the consumption of HCFC‑123 (a hydrochlorofluorocarbon) for use as a fire-extinguishing agent until December 31, 2029

Interested parties may submit comments by February 28, 2019 to the address or the email provided below. Comments and information received in response to the consultation document will be considered in finalizing the proposed amendments. The proposed regulations are expected to be published in the Canada Gazette, Part I, by July 2019. Note that at this time, no further changes to the regulations are being considered as part of this amendment.

Background

The main purpose of the regulations is to implement Canada’s obligations under the Montreal Protocol on Substances that Deplete the Ozone Layer (Montreal Protocol), including the Kigali Amendment to phase down HFCs, in order to protect the ozone layer and the climate.

The Kigali Amendment that Canada ratified in November 2017 came into force on January 1, 2019. It requires Canada to phase down HFCs in accordance with a specific reduction schedule from a calculated consumption baseline. Hence the regulations were amended in 2017 (the 2017 amendments), to establish the Canadian consumption baseline and to put the HFC phase-down schedule in Canada in place.

Revising the HFC consumption baseline

The regulations implement the phase-down of HFCs through a consumption allowance system. The base consumption for each company is calculated in accordance with subsection 65.06(2) as follows:

Base consumption = C/D x E
Where
C = the person’s average HFC consumption for 2014 and 2015 (expressed as tonnes of CO₂ equivalent)
D = the average Canadian HFC consumption for 2014 and 2015 (expressed as tonnes of CO₂ equivalent)
E = the Canadian HFC baseline = 19 118 651 tonnes of CO₂ equivalent

Each base consumption value is reduced by 10% to reflect the first step in the HFC phase-down that commenced on January 1, 2019 (see table 1 below). The allowance quantities correspond to the amount of new bulk HFCs a company would be allowed to consume (import + manufacture - export in tonnes CO₂ equivalent) during a calendar year; starting on January 1, 2019.

On October 27, 2018, an interim order amending the Ozone-depleting Substances and Halocarbon Alternatives Regulations was published to revise the Canadian HFC consumption baseline (the E value) to reflect information obtained by the Government of Canada following the 2017 amendments coming into force. The baseline (the E value) is used to determine the quantities of HFC that can enter Canada under the HFC allowance and phase-down process starting on January 1, 2019. Following the interim order, a notice of intent to amend the regulations was published on November 3, 2018 to indicate the intention to amend the regulations to incorporate the revised Canadian HFC consumption baseline into the regulations.

Allowing the consumption of HCFC‑123 for use as a fire-extinguishing agent until 2029

The Montreal Protocol and the regulations also control the export, import, manufacture and certain uses of ozone-depleting substances and HFCs, as well as products containing or designed to contain them. Ozone-depleting substances include:

• chlorofluorocarbons (CFCs)
• bromofluorocarbons
• hydrobromofluorocarbons (HBFCs)
• methyl bromide and
• hydrochlorofluorocarbons (HCFCs)

In November 2018, an adjustment to the Montreal Protocol was adopted at the 30th Meeting of the Parties to the Montreal Protocol to allow the consumption of HCFCs until December 31, 2029, for the servicing of existing fire protection equipment that is in service as of December 31, 2019. Subsections 38(2) and 46(2) of the regulations currently restrict the consumption of HCFC‑123 for the use and sale as a refrigerant between January 1, 2020 and December 31, 2029. Consequently, it is proposed to modify the regulations to align with this adjustment.

Proposed amendments

At this time, only two amendments to the regulations are proposed:

• to revise the Canadian HFC consumption baseline to reflect updated Canadian consumption data and
• to allow the consumption of HCFC‑123 as a fire-extinguishing agent until 2029

Revising the Canadian HFC consumption baseline

On May 1, 2018 consumption allowance estimates were sent to companies who were entitled to a 2019 HFC consumption allowance under the regulations in accordance to the data received by the Government of Canada.

Following the distribution of these estimates, a number of companies contacted the Government of Canada to inform that they had:

• failed to provide their past HFC consumption data or
• submitted incorrect data in response to the mandatory survey notices on HFCs that were published in 2014 and 2016

The missing and erroneous data resulted in the E value established in subsection 65.06(2) of the regulations to be higher by approximately 6% than what it should have been had the actual average quantity of HFC imported in Canada between 2011 and 2013 been used in the calculation of the E value.

The revised baseline will provide significant environmental benefits resulting from avoided HFC consumption and subsequent emissions that would contribute to climate change. The change will also ensure that Canada remains in compliance with its obligations under the Montreal Protocol by aligning its baseline established in the regulations to the actual Canadian consumption of HFC that will also be calculated by the Ozone Secretariat for the purpose of the Kigali Amendment.

The interim order that was published on October 27, 2018 revised the Canadian HFC consumption baseline provisionally. It ceases to have effect on:

• the day it is repealed
• the day regulations having the same effect as the interim order are made or
• two years after the interim order is made, whichever event happens first

It is therefore proposed to amend the Canadian HFC consumption baseline, the E value in subsection 65.06(2) of the regulations, to 18 008 795 tonnes CO₂ equivalent, in accordance with the interim order.

Allowing the consumption of HCFC‑123 for use as a fire-extinguishing agent until 2029

Consumption of HCFCs in Canada is almost phased-out pursuant to the obligations established under the Montreal Protocol. Currently, the regulations only allow companies holding an HCFC allowance to import and manufacture small quantities of HCFC for use as refrigerants or fire extinguishing-agent until December 31, 2019, or December 31, 2029 in the case of HCFC‑123 when used as a refrigerant.

Since the 2017 amendments came into force, an adjustment to the Montreal Protocol was adopted at the 30th Meeting of the Parties to the Montreal Protocol. This adjustment allows the consumption of HCFC‑123 until December 31, 2029 for use as a fire-extinguishing agent for the servicing of existing fire protection equipment that is in service as of December 31, 2019. This adjustment was adopted because there may be no other alternative for certain aircraft rescue and fire-fighting applications at the current time. It is proposed to amend the regulations to align it with this adjustment adopted by the Parties to the Montreal Protocol.

There is no data to confirm whether or not any HCFC‑123 is still being imported or manufactured to service existing fire protection equipment in Canada. However such equipment has been imported in the past and may require some servicing beyond 2019. It is important to note that this proposed amendment to the regulations would not increase the total quantities of HCFC‑123 allowed to enter Canada as the quantities allowed under the HCFC allowance system between 2020 and 2029 will remain unchanged.

Next steps

The proposed amendments are expected to be published in the Canada Gazette, Part I, by July 2019 for a 75-day public comment period. The final regulations are expected to be published in the Canada Gazette, Part II by September 2020.

Related information

• Ozone layer

Contact us

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Email: ec.gestionhalocarbures-halocarbonsmanagement.ec@canada.ca