The Commission presents a report assessing the quota allocation method in accordance with Regulation (EU) No 517/2014 (the "F-gas Regulation"), which aims to create an efficient and proportionate mechanism for reducing emissions from fluorinated greenhouse gases to help achieve the Union's climate targets.

To recall, the Regulation provides for a gradual reduction up to 2030 of the total quantities of HFCs that might be imported or produced in the EU (i.e. "place on the market for the first time"), by businesses (measured in CO2 equivalent).

The F-gas Regulation is sufficiently ambitious to ensure that the EU can meet its global obligations under the Kigali Amendment, which was agreed in October 2016 by 197 countries in order to phase down the global consumption and production of HFCs under the Montreal Protocol.

Quota system: in order to stay within the annual HFC limit in a given year, the F-gas Regulation puts in place a quota system. Since 2015 undertakings need quota to legally place bulk HFCs on the market and the Commission allocates quotas to undertakings for free on an annual basis.

These quotas are: (i) allocated to "incumbent" undertakings on the basis of "grandfathering", and (ii) taken from a reserve on the basis of annual company declarations stating their need for quota.

About 1 100 undertakings are currently affected by the quota allocation method, of which approximately two-thirds are HFC "quota holders" (i.e. bulk producers and/or importers), while the remaining undertakings are importers of equipment.

The main conclusion of the report is that the Commission does not intend to amend the quota allocation method at this time. It makes several observations in this regard.

Assessment of the allocation method : the Commission considers that it is too early for an in-depth assessment of the functioning of the phase-down mechanism and to thoroughly appreciate all possibly impacts of the chosen quota allocation method. Indeed:

only one full "annual" cycle of the phase-down has been completed and the inclusion of refrigeration, air conditioning and heat pump equipment under the phasedown has only begun very recently, on 1 January 2017; furthermore, there are indications that the data currently available is still affected by an initial lack of understanding by stakeholders.

The analysis undertaken and the consultation of stakeholders indicate that the phase-down is functioning as it should . The chosen allocation method allows on the one hand for stability in the market and, on the other hand, flexibility for new market players to enter the market.

The price development is fully in line with expectations and there is good compliance with the total EU HFC limit :

company ex post reporting data show that the phase-down had been overachieved in 2015. The total quantities reported were 8% under the allowable limit. Furthermore, the possibility for incumbents to transfer quotas did not result in major changes as to how quota was distributed between companies; although it is not possible to draw definite conclusions at this early stage of the phase-down, it is nonetheless possible to observe a general upward trend of prices since 2014. The price increases observed vary for different types of HFCs, and generally show a higher increase for HFCs with high global warming potential (GWP). These price increases are an expected and desirable consequence of the phase-down measure.

Free quotas : the Commission stresses that since the quotas are allocated for free, some actors may benefit from these price increases more than others. Some stakeholders pointed out that quota holders were the ones profiting and that it would be more sensible to instead set up a system that would generate revenue which could be used for supporting domestic and international implementation of HFC reductions and where equipment importers could also get their own quota. Accordingly, the Commission will closely follow:

the development of the situation for small and for new gas importers; the market situation of equipment importers which, in the current allocation system, depend on quota holders to obtain authorisations for their imports, also requires continued monitoring.

Costs: the report notes that the current method allows, based on the online F-gas Portal, implementation of the quota system by the Commission with little extra burden on, or costs to, Member States.

Most of the recurrent costs in Member States are a result of obligations already established by the previous Regulation (EC) No 842/2006. However, Member States will be asked to make increased contributions to the Multilateral Fund in the future to finance the Kigali Amendment, in line with their obligations under the Montreal Protocol.

Way forward : the Commission will focus on:

enabling a smooth implementation of the existing method and helping all stakeholders better understand and comply with their obligations, in order to make the EU HFC phase-down a success; monitoring the functioning of the allocation method and its impacts closely while noting that a comprehensive review of the F-gas Regulation is required by 31 December 2022.

In accordance with Regulation (EU) No 517/2014, this report concerns the availability for maintenance personnel of training in the safe handling of climate-friendly technologies replacing fluorinated greenhouse gases or in reducing their use.

Regulation (EU) No 517/2014 requires a reduction in the quantities of hydrofluorocarbons (HFCs) that companies are allowed to place on the market in the European Union through imports or production.

When supplies of HFCs are reduced, manufacturers of equipment and products currently using HFCs will have to opt for substitute refrigerants whose properties, such as certain level of flammability or a high pressure, are sometimes unknown to end-users and equipment maintenance staff.

In order to ensure the safety of the installation and use of such equipment , staff should have access to appropriate training throughout the Union.

This report analyses the relevant EU legislation. It also examines the training currently available in all Member States as well as the participation rate of maintenance staff in these training courses in addition to other training initiatives currently in place.

Adequacy of legislation: the report concludes that the existing legislative framework, complemented by the existing European standards, appears sufficient to ensure the safe handling of such equipment provided that these rules are respected. Therefore, it is not necessary to resort to further European-wide legislation at the current stage

Existence of appropriate training materials: the problem of training is taken very seriously by the various stakeholders involved. In addition, there is now a satisfactory availability of training materials that can be used in training programmes on substitute refrigerants (EN 13331, European Association of Refrigeration and Air Conditioning guidelines - AREA, a “Real Alternatives” project funded by the EU, many national activities), many of which are freely available to technicians in all Member States.

Obstacles related to training opportunities: the information provided shows that the training in the use of climate-friendly substitution technologies currently available presents shortcomings in practice . These problems concern in particular:

lack of practical training infrastructure: delays in setting up an adequate number of training infrastructures appear to be linked to the investment costs required for their creation and their operating costs. It is therefore necessary to identify ways to encourage investment in such infrastructures; the lack of qualified engineers and technicians: according to the figures, the participation rate in training courses is insufficient to meet the medium- and long-term requirements for the phasing out of HFCs. In order to increase the number of technicians with the required training, the report stresses the importance of (i) using “train the trainer” programmes to address the existing geographical imbalance; (ii) ensuring that large retailers permit only technicians trained to work on their systems; (iii) defining, at the level of industry associations, minimum training requirements or setting up “skill card” systems enabling technicians to have an official record of their training and skills profile.

The report recommends intensifying efforts to ensure that the supply of training can meet the future increase in demand.

In this context, the Commission has made training on substitute refrigerants one of the key priorities of the 2016 call for proposals under the LIFE programme .

Moreover, national authorities could use available funding programmes to support the development of appropriate infrastructure and training programmes and to raise awareness of and disseminate existing rules and standards.

In accordance with Regulation (EU) No 517/2014, this report concerns the barriers posed by codes, standards and legislation to using climate-friendly technologies in the refrigeration, air conditioning, heat pumps and foam sectors.

Regulation (EU) No 517/2014 requires a reduction in the quantities of hydrofluorocarbons (HFCs) companies may place on the market in the EU.

Manufacturers of equipment and products using HFCs must therefore shift to the use of more climate-friendly alternatives. However, non-technological barriers may put this transition to more climate-friendly alternatives at risk and result in higher costs than necessary.

This report covers legislation and standards at a European and an international level, as these standards establish benchmarks, widely used by companies, for the safe use of equipment throughout Europe. Codes, standards and legislation may indirectly impact the use of alternatives to HFCs by specifying requirements for the design or manufacture of equipment and its components, the installation of equipment as well as its service, maintenance and dismantling that are not consistent with the use of a particular alternative technology.

Barriers posed by codes, standards and legislation : codes, standards or legislation at either a European or national level do not seem, for the most part, to pose a significant barrier to the use of ammonia or CO2 as a refrigerant.

On the other hand, on the basis of input from Member States' authorities and consultations with stakeholders it can be concluded that standards (at international, European and national level) regarding the use of flammable refrigerants appear to be an important barrier to the uptake of climate-friendly alternatives to HFCs.

Although the recent revision of EN 378 introduces a new flammability category for HFCs and HFOs, the following barriers for flammable refrigerants, in particular for hydrocarbons, require particular attention:

the European level standards unnecessarily restrict charge sizes beyond what is needed to guarantee a safe use of the equipment. In particular the charge size limits for human comfort cooling and below ground charge limits appear overly restrictive; product standards such as EN 60335-2-40 (safety requirements for electrical heat pumps, air conditioners, and dehumidifiers) and EN 60335-2-89 (safety requirements for commercial refrigerating appliances) are based on International Electrotechnical Commission (IEC) standards that are set at international level. Hence EU companies and policy makers can only partly influence the outcome; updates of standards are usually made at intervals of 5 years or longer ; the time lag between agreeing international amendments and having them reflected in the European product standards is often another 1-3 years; SMEs find it difficult to find the resources to participate in the lengthy and resource-intensive standard-setting processes; providing data and conducting the necessary risk assessments that would enable companies to market innovative solutions using climate friendly alternatives is a challenge; in some EU Member States there are national codes, standards and legislation that simply ban flammable refrigerants in certain applications.

Possible solutions : to facilitate the achievement of the EU HFC phase-down and emission reductions in the EU and third countries as required by the Paris Agreement, the report stressed the need for:

European standardisation organisations to facilitate the update of relevant standards at the European level;

companies and researchers to collect data and evidence enabling better risk minimization approaches for all flammable refrigerants and to make such information available to the relevant standard committees;

Member States that have restrictive national codes, standards or legislation to consider a review in the light of technical developments.

In addition, the Commission envisages:

a request to the European standardisation organisations in support of updating relevant standards at the European level, ensuring a technology neutral and consistent approach. In particular, there is a need to maximise charge sizes without compromising safety as well as allowing a more general use of risk management approaches for all refrigerants. A mandate for this request is under preparation; facilitating at an international level an exchange of information on standards , their review and related processes.

PURPOSE: to protect the environment by reducing emissions of fluorinated greenhouse gases.

LEGISLATIVE ACT: Regulation (EU) No 517/2014 of the European Parliament and of the Council on fluorinated greenhouse gases and repealing Regulation (EC) No 842/2006.

CONTENT: the objective of this Regulation is to protect the environment by reducing emissions of fluorinated greenhouse gases . Accordingly, the Regulation:

· establishes rules on containment, use, recovery and destruction of fluorinated greenhouse gases, and on related ancillary measures;

· imposes conditions on the placing on the market of specific products and equipment that contain, or whose functioning relies upon, fluorinated greenhouse gases;

· imposes conditions on specific uses of fluorinated greenhouse gases; and

· establishes quantitative limits for the placing on the market of hydrofluorocarbons.

The new Regulation should allow the reduction of emissions of fluorinated greenhouse gases in the Union by two-thirds (60-61%) compared to their current levels by 2030.

Such a reduction means that emissions would have to be reduced to approximately 35Mt of CO 2 equivalent by 2030.

The Resolution of the European Parliament of 14 September 2011 on a comprehensive approach to non-CO 2 climate-relevant anthropogenic emissions called for the exploration of ways of exploring an immediate reduction in hydrofluorocarbons under the Montreal Protocol.

The main elements of the Regulation are the following:

Containment : according to the Regulation, the intentional release of fluorinated greenhouse gases into the atmosphere shall be prohibited where the release is not technically necessary for the intended use.

Operators of equipment that contains fluorinated greenhouse gases must:

· take all measures which are technically and economically feasible to minimise leakage of fluorinated greenhouse gases;

· ensure that equipment that contains fluorinated greenhouse gases in quantities of 5 tonnes of CO 2 equivalent or more and not contained in foams is checked for leaks ;

· ensure that equipment containing fluorinated greenhouse gases in quantities of 500 tonnes of CO 2 equivalent or more, is provided with a leakage detection system which alerts the operator or a service company of any leakage.

· establish and maintain, for each piece of equipment subject to leak checks, registers in which they must log a certain amount of information.

The legislation also encourages the development of producer responsibility schemes for the recovery of fluorinated greenhouse gases and their recycling, reclamation or destruction.

Training and certification : Member States shall establish or adapt certification programmes, including evaluation processes. Training should be available for natural persons carrying out installation, servicing, maintenance, repair or decommissioning of the equipment listed in the Regulation.

Registry : by 1 January 2015, the Commission shall set up and ensure the operation of an electronic registry for quotas for placing hydrofluorocarbons on the market. Registration in the registry shall be compulsory, among others, for producers and importers to which a quota for the placing on the market of hydrofluorocarbons has been allocated in accordance with the Regulation.

Restrictions on the placing on the market : the Regulation introduces restrictions on the placing on the market of products with the aim of completely eliminating the use of fluorinated gases in some new sectors, for which other safe and effective solutions, from the point of view of energy and the economy, are possible, in particular :

fire protection equipment containing HFC-23 (market ban from 2016); refrigerators and freezers for commercial use: i) containing HFCs with GWP of 2500 or more (from 2020); ii) containing HFCs with GWP of 150 or more (from 2022); stationary refrigeration equipment containing HFCs with GWP of 2500 or more (from 2020); movable room air-conditioning equipment containing HFCs with GWP of 150 or more (from 2020); single split air-conditioning systems containing less than 3kg of fluorinated greenhouse gases containing fluorinated greenhouse gases with GWP of 750 or more (from 2025); foams that contain HFCs with GWP of 150 or more, extruded polystyrene (from 1 January 2020) and other foams (from 1 January 2023); technical aerosols that contain HFCs with GWP of 150 or more (from 2018).

Reduction of the quantity of hydrofluorocarbons placed on the market : the Regulation introduces a mechanism of progressive reduction to apply a ceiling decreasing to the total volume of HFC (in tonnes of CO 2 equivalent) placed on the market in the EU, with a freeze in 2015, followed by a first reduction in 2016-2017 (93%) to reach 21% of the volumes sold during the period 2009-2012 by 2030 .

Reports : no later than the end of 2020, the Commission should produce a report on the availability of hydrofluorocarbons on the Union market.

No later than 31 December 2022, it shall publish a comprehensive review on the effects of this Regulation , including notably: i) a forecast of the continued demand for hydrofluorocarbons up to and beyond 2030; ii) an assessment of the need for further action by the Union; iii) a review of the availability of technically feasible and cost-effective alternatives to products and equipment containing fluorinated greenhouse gases for products and equipment not listed in the Regulation.

ENTRY INTO FORCE: 09.06.2014. The Regulation shall apply from 01.01.2015.

DELEGATED ACTS: the Commission may adopt delegated acts in order to supplement or amend non-essential aspects of the Regulation. The power to adopt such acts shall be conferred on the Commission for a period of five years from 10 June 2014 . The European Parliament or the Council may object to a delegated act within a period of two months from the date of notification (this period can be extended for two months). If the European Parliament or the Council make objections, the delegated act will not enter into force.

The European Parliament adopted by 644 votes to 19 votes with 16 abstentions, a legislative resolution on the proposal for a regulation of the European Parliament and of the Council on fluorinated greenhouse gases.

Parliament adopted its position at first reading following the ordinary legislative procedure. The amendments adopted in plenary are the result of an agreement negotiated between the European Parliament and the Council.

Scope : the objective of this regulation is to protect the environment by reducing emissions of fluorinated greenhouse gases . Accordingly, this regulation:

establishes rules on containment, use, recovery and destruction of fluorinated greenhouse gases; imposes conditions on the placing on the market of specific products and equipment that contain, or whose functioning relies upon, fluorinated greenhouse gases; imposes conditions on specific uses of fluorinated greenhouse gases; and establishes quantitative limits for the placing on the market of hydrofluorocarbons (HFCs).

Leak checks : operators of equipment that contains fluorinated greenhouse gases in quantities of 5 tonnes of CO 2 equivalent or more and not contained in foams shall ensure that the equipment is checked for leaks.

Hermetically sealed equipment that contains fluorinated greenhouse gases in quantities of less than 10 tonnes of CO 2 equivalent, shall not be subject to leak checks , provided the equipment is labelled as hermetically sealed.

Leakage detection systems : the text foresees that operators of the equipment containing fluorinated greenhouse gases in quantities of 500 tonnes of CO 2 equivalent or more , shall ensure that the equipment is provided with a leakage detection system which alerts the operator or a service company of any leakage.

Training and certification : Member States shall establish certification programmes , including evaluation processes. Training shall be available for natural persons carrying out installation, servicing, maintenance , repair or decommissioning of the equipment listed in the regulation.

Registry : by 1 January 2015, the Commission shall set up and ensure the operation of an electronic registry for quotas for placing hydrofluorocarbons on the market. Registration in the registry shall be compulsory for importers of equipment placing pre-charged equipment on the market where the hydrofluorocarbons contained in the equipment have not been placed on the market prior to the charging of that equipment.

Restrictions on the placing of HFCs on the market : Parliament amended the Commission’s proposal to completely eliminate the use of fluorinated gases in several new sectors, for which other safe and effective solutions are possible, in particular:

Fire protection equipment containing HFC-23 : (prohibited from placing on the market from 2016); Refrigerators and freezers for commercial use : i) that contain HFCs with GWP of 2500 or more ( prohibited from placing on the market from 2020); ii) that contain HFCs with GWP of 150 or more ( prohibited from placing on the market from 2022); Stationary refrigeration equipment, that contains, or whose functioning relies upon, HFCs with GWP of 2500 or more ( prohibited from placing on the market from 2020); Multipack centralised refrigeration systems for commercial use with a rated capacity of 40kW or more that contain, or whose functioning relies upon, fluorinated greenhouse gases with GWP of 150 or more ( prohibited from placing on the market from 2022); Single split air-conditioning systems containing less than 3kg of fluorinated greenhouse gases, that contain, or whose functioning relies upon, fluorinated greenhouse gases with GWP of 750 or more ( prohibited from placing on the market from 2025); Foams : prohibited from placing on the market from 2020 for extruded polystyrene (and from 2023 for other foams); Technical aerosols that contain HFCs with GWP of 150 or more ( prohibited from placing on the market from 2018).

Where alternatives are not available or where the use of such alternatives would entail disproportionate costs, it should be possible for the Commission to authorise an exemption to allow the placing on the market of such products and equipment for a period of up to four years.

Producer responsibility schemes : the legislation shall also encourage the development of producer responsibility schemes for the recovery of fluorinated greenhouse gases and their recycling, reclamation or destruction.

Review : Parliament demanded that no later than 31 December 2022 , the Commission publish a comprehensive report on the effects of this regulation, including:

a forecast of the continued demand for hydrofluorocarbons up to and beyond 2030; an assessment of the need for further action by the Union and its Member States in light of existing and new international commitments regarding the reduction of fluorinated greenhouse gas emissions; a review of the availability of technically feasible and cost-effective alternatives to products and equipment containing fluorinated greenhouse gases for products and equipment, taking into account energy efficiency.

The Committee on the Environment, Public Health and Food Safety adopted the report by Bas EICKHOUT (Greens/EFA, NL) on the proposal for a regulation of the European Parliament and of the Council on fluorinated greenhouse gases.

The committee recommends that the European Parliament’s position adopted at first reading, following the ordinary legislative procedure, should amend the Commission proposal as follows:

Scope : the objective of this Regulation should be to protect the environment by reducing emissions of fluorinated greenhouse gases and to stimulate innovation in sustainable technologies. Accordingly, this Regulation should:

lay down rules on containment, use, recovery and destruction of fluorinated greenhouse gases; prohibit specific uses of such gases, whilst setting out quantitative limits for the placing on the market of HFCs; provide valuable input for the adoption of a future international agreement.

The regulatory approach used for ozone-depleting substances under Regulation (EC) No 1005/2009 of the European Parliament and of the Council on substances that deplete the ozone layer, should also be used to regulate HFCs.

Limits and bans on placing on the market (POM) of HFCs : the committee stated that placing on the market (POM) prohibitions are appropriate when sustainable alternatives can meet the demand for new equipment in a certain subsector. Such as:

Solvents that contain fluorinated greenhouse gases except for precision cleaning of electrical and other components in aerospace and aeronautics applications and in the manufacture of semiconductors : POM from 2020. Fire protection systems and fire extinguishers (except for certain applications) :POM from 2020. Foams : POM prohibition in 2016 for extruded polystyrene foams (from 2020 for other foams). Technical non-medical aerosols that contain fluorinated greenhouse gases from 2018. Refrigeration : POM prohibition in 2020 on stationary refrigeration. POM prohibition in 2025 on mobile refrigeration. Refrigerators and freezers for the storage, display or distribution of products in retail and food service - hermetically sealed systems that contain HFCs from 2018. Air-Conditioning : POM prohibition in 2020 for stationary air conditioning and cargo ships.

According to Members, the overall use of HFCs should be reduced to 16% of the current consumption by 2030 (against 21% suggested by the European Commission).

By 1 January 2018, the Commission should assess whether effective, reliable alternatives exist which:

make the replacement of SF6 possible , at a reasonable cost, in new medium-voltage secondary switchgear; make the replacement of fluorinated greenhouse gases possible, at a reasonable cost, in fire protection systems .

Allocation Fee : the report stipulated that each producer and importer shall transmit, prior to accessing their allocated quota or portion thereof, an allocation fee of EUR 10 per tonne of CO2 equivalent of HFCs for the quantities of HFCs to be placed on the market during the upcoming year.

The revenues collected shall be used to support the implementation of this Regulation and to address regional divergences especially targeted in countries with high temperatures, in relation to the extent of use of fluorinated greenhouse gases per capita, the cost of replacement technologies due to climatic conditions, creation of incentives for the proper recovery of fluorinated greenhouse gases and market surveillance to counter illegal trade.

The Commission should publish a report on the use of revenues on 1 January 2017.

Producer Responsibility Scheme : Members suggested that Member States shall ensure that producer responsibility schemes are in place for the recovery of fluorinated greenhouse gases and their recycling, reclamation or destruction . Such schemes shall be adopted by 1 January 2016. They should:

enable operators and persons to discard recovered fluorinated greenhouse gases, including products and equipment containing fluorinated greenhouse gases, at an accessible collection point in their vicinity at no charge; require operators and persons decommissioning equipment to discard recovered fluorinated greenhouse gases at an accessible collection point.

Review : Members requested that no later than 31 December 2022, the Commission should publish a comprehensive report on the effects of this Regulation, including: (a) a forecast of the expected demand for HFCs in 2024, 2027, 2030 and after 2030, (b) an assessment of the potential phaseout of HFCs by 2030 or soon thereafter.

PURPOSE: to ensure a high level of environmental protection by reducing substantially fluorinated greenhouse gas emissions responsible for climate change.

PROPOSED ACT: Regulation of the European Parliament and of the Council.

BACKGROUND: according to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change ("IPCC") of the United Nations Framework Convention on Climate Change ("UNFCCC"), to which the Union is party, on the basis of existing scientific data, developed countries would need to reduce greenhouse gas emissions by 80 % to 95 % below 1990 emissions by 2050 to limit global climate change to a temperature increase of 2°C and thus prevent undesirable climate effects.

The Roadmap for moving to a competitive low carbon economy in 2050 proposes a cost-effective way of achieving the necessary overall emission reductions in the Union by 2050. This roadmap establishes the sectoral contributions needed in six areas. Non-CO2 emissions (including fluorinated greenhouse gases but excluding non-CO2 emissions from agriculture) should be reduced by 72 % to 73 % by 2030 and by 70 % to 78 % by 2050 , compared to 1990 levels.

In September 2011 the Commission published a report on the application of Regulation (EC) No 842/2006 on certain fluorinated greenhouse gases. It concluded that the Regulation could deliver significant emission reductions if it was further improved and fully applied. It also stated that more needed to be done to further reduce F-gas emissions in the EU.

By ensuring that F-gases are replaced by safe alternatives with no or a lower impact on the climate, yearly emissions expressed in CO2 equivalent could be cut by two-thirds by 2030 at relatively low cost.

IMPACT ASSESSMENT: the Commission, finally, only retained those options that were shown to deliver substantial emission savings at low abatement costs and to be consistent with other EU policies. Full application of the F-Gas Regulation was set as the baseline option. Four other policy options were assessed in detail:

1) Voluntary agreements;

2) Extended scope for containment and recovery measures;

3) Quantitative limits on the supply of HFCs (phase-down);

4) A ban on placing certain products and equipment that contain F-gases on the EU market.

The methodological basis for the impact assessment was a detailed analysis of the feasibility of introducing safe, energy-efficient alternatives in the 28 main sectors that use F-gases.

The impact assessment showed that:

a phase-down of HFCs that introduces gradually lower limits until 2030 for the amounts of these F-gases to be put on the market in the EU would deliver the most emission savings, reducing today’s emissions by two-thirds by 2030 (roughly 70 million tonnes of CO2 equivalent); an emission reduction of two thirds would prepare EU industry for a phase-down . It would lead to cost reductions due to higher market penetration and to economies of scale for alternative technologies, thus helping to reach an agreement on the proposals under the Montreal Protocol.

Administrative costs can be kept relatively low (total administrative costs of around EUR 2 million a year for a phase-down).

LEGAL BASIS: Article 192(1) of the Treaty on the Functioning of the European Union (TFEU).

CONTENT: the proposal seeks to:

replace Regulation (EC) No 842/2006 on certain fluorinated greenhouse gases in order to ensure a more cost-efficient contribution to achieving the EU’s climate objectives by discouraging the use of F-gases with a high impact on the climate in favour of energy-efficient and safe alternatives, and further improving the containment and end-of-life treatment of products and equipment that contain F-gases; enhance sustainable growth, stimulate innovation and develop green technologies by improving market opportunities for alternative technologies and gases with a low impact on the climate; bring the EU into line with the latest scientific findings at international level, as described in the Fourth Assessment Report of the UN’s IPCC, e.g. with regard to the substances covered by this regulation and the calculation of their global warming potential (GWP); help to bring about a consensus on an international agreement to phase down hydrofluorocarbons (HFCs), the most relevant group of F-gases, under the Montreal Protocol; simplify and clarify Regulation (EC) No 842/2006 to reduce administrative burden in line with the Commission’s commitment to better regulation.

The key aspects of the proposal are as follows:

Adaptation of existing provisions: the proposal maintains the current provisions of the F-Gas Regulation, with adjustments to ensure better implementation and enforcement of the legislation by national authorities. Some containment measures have also been extended to refrigerated trucks and trailers.

Mechanism for the gradual reductions of HFCs: the most important new measure is the introduction of quantitative limits on the supply of bulk HFC substances in the EU, decreasing over time. The phase-down mechanism involves a gradually declining cap on the total placement of bulk HFCs (in tonnes of CO2 equivalent) on the market in the EU with a freeze in 2015, followed by a first reduction in 2016 and reaching 21 % of the levels sold in 2008–11 by 2030.

By means of this mechanism:

companies that place bulk HFCs on the EU market must have rights to place bulk substances on the EU market for the first time; the Commission allocates free quotas to companies based on past reporting data, with a reserve for new entrants; companies must make sure that they have enough rights to cover their actual placing of products and equipment on the market. They may transfer quotas among themselves; the Commission checks compliance the following year, with independent verification of reports; a threshold ensures that companies that only place small quantities on the market are exempted.

HFCs imported in pre-charged equipment: these should also be counted under the phase-down. Therefore, non-hermetically sealed HFC appliances would still be able to be produced in, or imported into, the EU but they would have to be filled at the place of installation. Similarly, the placing on the market of movable air conditioning containing HFCs will be banned from 2020.

Additional bans: a few additional bans are introduced to underpin the phase-down mechanism and restrict the use of other F-gases not covered by the mechanism.

Recharging of existing refrigeration equipment with a charge size over 5 tonnes of CO2 equivalent with HFC of very high GWP (>2500) will not be permitted from 2020 onwards as more adequate and energy efficient drop-in refrigerants of lower GWP are already widely available on the market.

Restrictions on the use of SF6 in magnesium die casting is extended also to facilities using less than 850 kg per year as technological progress has rendered such use obsolete.

Lastly, additional reporting obligations should enable monitoring of the use of F-gases that are not covered by current legislation.

BUDGETARY IMPLICATION: the proposal has no incremental impact on the budget of the European Union.

DELEGATED ACTS: the proposal contains provisions empowering the Commission to adopt delegated acts in accordance with Article 290 of the Treaty on the Functioning of the European Union.

PURPOSE: to ensure a high level of environmental protection by reducing substantially fluorinated greenhouse gas emissions responsible for climate change.

PROPOSED ACT: Regulation of the European Parliament and of the Council.

BACKGROUND: according to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change ("IPCC") of the United Nations Framework Convention on Climate Change ("UNFCCC"), to which the Union is party, on the basis of existing scientific data, developed countries would need to reduce greenhouse gas emissions by 80 % to 95 % below 1990 emissions by 2050 to limit global climate change to a temperature increase of 2°C and thus prevent undesirable climate effects.

The Roadmap for moving to a competitive low carbon economy in 2050 proposes a cost-effective way of achieving the necessary overall emission reductions in the Union by 2050. This roadmap establishes the sectoral contributions needed in six areas. Non-CO2 emissions (including fluorinated greenhouse gases but excluding non-CO2 emissions from agriculture) should be reduced by 72 % to 73 % by 2030 and by 70 % to 78 % by 2050 , compared to 1990 levels.

In September 2011 the Commission published a report on the application of Regulation (EC) No 842/2006 on certain fluorinated greenhouse gases. It concluded that the Regulation could deliver significant emission reductions if it was further improved and fully applied. It also stated that more needed to be done to further reduce F-gas emissions in the EU.

By ensuring that F-gases are replaced by safe alternatives with no or a lower impact on the climate, yearly emissions expressed in CO2 equivalent could be cut by two-thirds by 2030 at relatively low cost.

IMPACT ASSESSMENT: the Commission, finally, only retained those options that were shown to deliver substantial emission savings at low abatement costs and to be consistent with other EU policies. Full application of the F-Gas Regulation was set as the baseline option. Four other policy options were assessed in detail:

1) Voluntary agreements;

2) Extended scope for containment and recovery measures;

3) Quantitative limits on the supply of HFCs (phase-down);

4) A ban on placing certain products and equipment that contain F-gases on the EU market.

The methodological basis for the impact assessment was a detailed analysis of the feasibility of introducing safe, energy-efficient alternatives in the 28 main sectors that use F-gases.

The impact assessment showed that:

a phase-down of HFCs that introduces gradually lower limits until 2030 for the amounts of these F-gases to be put on the market in the EU would deliver the most emission savings, reducing today’s emissions by two-thirds by 2030 (roughly 70 million tonnes of CO2 equivalent); an emission reduction of two thirds would prepare EU industry for a phase-down . It would lead to cost reductions due to higher market penetration and to economies of scale for alternative technologies, thus helping to reach an agreement on the proposals under the Montreal Protocol.

Administrative costs can be kept relatively low (total administrative costs of around EUR 2 million a year for a phase-down).

LEGAL BASIS: Article 192(1) of the Treaty on the Functioning of the European Union (TFEU).

CONTENT: the proposal seeks to:

replace Regulation (EC) No 842/2006 on certain fluorinated greenhouse gases in order to ensure a more cost-efficient contribution to achieving the EU’s climate objectives by discouraging the use of F-gases with a high impact on the climate in favour of energy-efficient and safe alternatives, and further improving the containment and end-of-life treatment of products and equipment that contain F-gases; enhance sustainable growth, stimulate innovation and develop green technologies by improving market opportunities for alternative technologies and gases with a low impact on the climate; bring the EU into line with the latest scientific findings at international level, as described in the Fourth Assessment Report of the UN’s IPCC, e.g. with regard to the substances covered by this regulation and the calculation of their global warming potential (GWP); help to bring about a consensus on an international agreement to phase down hydrofluorocarbons (HFCs), the most relevant group of F-gases, under the Montreal Protocol; simplify and clarify Regulation (EC) No 842/2006 to reduce administrative burden in line with the Commission’s commitment to better regulation.

The key aspects of the proposal are as follows:

Adaptation of existing provisions: the proposal maintains the current provisions of the F-Gas Regulation, with adjustments to ensure better implementation and enforcement of the legislation by national authorities. Some containment measures have also been extended to refrigerated trucks and trailers.

Mechanism for the gradual reductions of HFCs: the most important new measure is the introduction of quantitative limits on the supply of bulk HFC substances in the EU, decreasing over time. The phase-down mechanism involves a gradually declining cap on the total placement of bulk HFCs (in tonnes of CO2 equivalent) on the market in the EU with a freeze in 2015, followed by a first reduction in 2016 and reaching 21 % of the levels sold in 2008–11 by 2030.

By means of this mechanism:

companies that place bulk HFCs on the EU market must have rights to place bulk substances on the EU market for the first time; the Commission allocates free quotas to companies based on past reporting data, with a reserve for new entrants; companies must make sure that they have enough rights to cover their actual placing of products and equipment on the market. They may transfer quotas among themselves; the Commission checks compliance the following year, with independent verification of reports; a threshold ensures that companies that only place small quantities on the market are exempted.

HFCs imported in pre-charged equipment: these should also be counted under the phase-down. Therefore, non-hermetically sealed HFC appliances would still be able to be produced in, or imported into, the EU but they would have to be filled at the place of installation. Similarly, the placing on the market of movable air conditioning containing HFCs will be banned from 2020.

Additional bans: a few additional bans are introduced to underpin the phase-down mechanism and restrict the use of other F-gases not covered by the mechanism.

Recharging of existing refrigeration equipment with a charge size over 5 tonnes of CO2 equivalent with HFC of very high GWP (>2500) will not be permitted from 2020 onwards as more adequate and energy efficient drop-in refrigerants of lower GWP are already widely available on the market.

Restrictions on the use of SF6 in magnesium die casting is extended also to facilities using less than 850 kg per year as technological progress has rendered such use obsolete.

Lastly, additional reporting obligations should enable monitoring of the use of F-gases that are not covered by current legislation.

BUDGETARY IMPLICATION: the proposal has no incremental impact on the budget of the European Union.

DELEGATED ACTS: the proposal contains provisions empowering the Commission to adopt delegated acts in accordance with Article 290 of the Treaty on the Functioning of the European Union.