+------------------------------------------------------------------------------+
World Bank Backs Credits for HFC Projects as UN Boosts Scrutiny
2010-08-23 09:00:51.656 GMT
By Mathew Carr
Aug. 23 (Bloomberg) -- The World Bank expressed support for
the United Nations-overseen program that awards tradable credits
for reducing hydrofluorocarbon-23 gases, saying it hasn't
inflated production of a chemical called chlorodifluoromethane.
HFC-23 gases, or trifluoromethane, are a byproduct in the
making of chlorodifluoromethane, which is known as HCFC-22 and
used in the air-conditioning and refrigeration industries.
HFC-23 gas's warming effect in the atmosphere is 11,700 times
more powerful than carbon dioxide.
The price of credits from the UN's Clean Development
Mechanism Executive Board surged last week after it requested
reviews for five HFC-23-cutting projects, spurring speculation
that a clamp down will reduce the supply of credits. HFC-23
offsets make up about half of the total issued in the program
since 2005. CDM offsets can be used for compliance in the
European Union carbon market, the world's biggest.
The World Bank said the availability of UN credits is
"clearly not" driving demand at chemical plants that make
chlorodifluoromethane. "If we look at China alone, where the
majority of HFC-23 projects are located, the overall national
production of HCFC-22 very significantly exceeds that of the
CDM" projects, the World Bank said in the report on its
website.
HCFC-22 production has increased by 25 percent a year for
uses such as cooling in developing countries, the report said.
An overproduction would mean that more HCFC-22 is produced
than consumed, the report said. In China, domestic consumption
alone would cover the annual HCFC-22 production capacity of the
11 Chinese HFC-23 destruction CDM projects, it said. That
excludes exports.
Volumes of produced HCFC-22 maintained on site were an
"extremely low" 3.7% on average for 2008 and 2009, the bank
said. "Demand is real and there is little surplus."
For Related News and Information:
Emission market news NI ENVMARKET <GO>
Today's top energy stories ETOP <GO>
European power-markets home page EPWR <GO>
--Editors: Mike Anderson
To contact the reporter on this story:
Mathew Carr in London at +44-20-7073-3531 or
m.carr@bloomberg.net
To contact the editor responsible for this story:
Stephen Voss at +44-20-7073-3520 or sev@bloomberg.net
