Halons Technical Options Committee

11.4Transformation of Halons

The term “transformation” refers to the conversion of halon into useful, commercially viable products. Ideally this transformation would produce environmentally friendly products that could be sold for profit. More information on the reaction chemistry for transformation of halons 1211 and 1301 can be found in Chapter 9 of the 2006 HTOC Assessment report.

The Chemicals Technical Options Committee (CTOC) has determined that halon 1301 is a very useful feedstock for the preparation of bioactive compounds. In particular, halon 1301 has been used for many years in the preparation of Fipronil, a broad-spectrum insecticide. In order to support Fipronil production, halon 1301 feedstock production in France has averaged approximately 400 MT per annum since the mid-1990s and more recently approximately 500 MT in China. As the demand for Fipronil (or other bioactive compounds) grows worldwide, it is conceivable that other manufacturing facilities may restart production of halon 1301 to support the feedstock needs. As yet, no Party has used this process to transform existing stocks of halon 1301.

CTOC has received information on one technology, the Newcastle process, covered by a US patent 0036719 (2009) to Kennedy, et al., which has processed halons and CFCs on a pilot scale. Operating at 25kg/hour, the process has a 99.8% conversion efficiency with vinylidene fluoride as a major product. At higher temperatures, the conversion efficiency is over 99.99% for halons and CFCs. No dioxins have been detected with this process. CTOC continues to review information on emerging technologies for potential transformation and destruction of halons and other ODS.

11.5Carbon Credits for ODS Destruction

11.5.1Avoiding Emissions of Unwanted ODS

Since the 2006 Assessment, there has been a renewed interest by the Parties to address the issue of continued emissions of ODS and the option of destroying unwanted ODS to avoid emissions altogether. The Parties have requested a number of reports and studies and held a number of workshops related to this issue. A recent study by the World Bank considered how ODS destruction could be financed through the voluntary carbon market (ICF, 2010) as ODS also have high GWPs. The study confirmed a limited window of opportunity over the next two decades in which ODS could potentially be available for destruction for credits as long as the appropriate incentives could be created to encourage increased recovery of ODS at equipment end-of-life. Even with increased recovery from a diminishing, accessible bank of ODS for credits, it is expected that ODS destruction projects will be a small percentage of the overall voluntary market in the coming years. The avoided emissions, however, could be significant and timely for ozone layer recovery and avoided emissions of GHGs.

11.5.2Voluntary Market Standards for ODS Destruction

According to the World Bank study mentioned above, the global carbon market is comprised of two key segments – a compliance market and a voluntary market. The Bank estimated that the global carbon market represented US$126 billion of total traded value in 2008, of which the voluntary market represented less than 1%. The markets can be further broken down into allowance-based and project-based markets. The project-based, voluntary market is the primary focus for ODS destruction projects where individual projects that demonstrate additional, verifiable, and permanent decreases in GHG emissions earn emission reduction credits that are tradable.

As of February 2010, ODS destruction is eligible for carbon credits under the following two standards: the Climate Action Reserve (CAR) and the Voluntary Carbon Standard (VCS). Neither of these standards provides credits for the destruction of halon under their protocols.

11.5.3Considerations for Halon Destruction

The availability of carbon credits for ODS destruction raises some specific issues with regard to halons which need further consideration. Halons, more than some of the other ODS, are readily accessible for collection, storage, and disposal, making them very attractive for potential ODS destruction projects under a carbon credit protocol. However, there are a number of issues with regard to the destruction of halons, in general, and as an offset credit project specifically.

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  Continued Demand: Owing to the continued global demand for halons, the HTOC has recommended that destruction as a final disposition option should be considered only if the halons are cross-contaminated and cannot be reclaimed to an acceptable purity. The global phase-out of halons has been planned based upon halons being reclaimed and reused until the end of the useful life of the systems they are employed in and until there are no longer any important uses. Early destruction of halons undermines the long-range plan set by the Parties, imposes significant financial burdens on users who invested in their halon systems, and puts at risk uses that generally have the potential for significant loss of life in a fire scenario. The actual amounts of the global halon inventory potentially available for destruction are highly uncertain due to business planning and economic considerations by users, potential local and regional imbalances of supply and demand, the availability of destruction technologies and facilities, inventory management approaches, and applicable disposal regulations.
  
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  Uncertain Climate Impact: A number of the voluntary standards have cited uncertainty with the actual global warming impact of halon destruction as the reason for its current exclusion from their protocols. The HTOC recommends that the Parties may wish to consider requesting the Scientific Assessment Panel to clarify the extent of the climate benefits, if any, resulting from destroying banked halons.
  
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  Avoiding Perverse Incentives: There are concerns that the availability of carbon credits for halon destruction may inadvertently lead to the wrong incentives – to actions that actually lead to more environmental harm and, worse, to potentially illegal activities. With halons, one concern is that the continued new production of halon 1301 used as a feedstock for a pesticide product may lead to production simply for destruction credits since newly produced halon is technically indistinguishable from recycled halon. In fact, there exists the potential under the Montreal Protocol for a Party to produce halons or any other ODS and destroy equivalent amounts of the same ODS in the same year, resulting in a net zero production and consumption profile for the Party. The Protocol definition of “production” subtracts the amount of ODS destroyed from any amount produced, so a Party reporting net zero production and consumption is in compliance with the Protocol. Further consideration by the Parties and the voluntary standards should be given to highlight this issue and consider if additional measures are needed to ensure that new production of halons or any other ODS for the sole purpose of destruction for carbon credits is avoided.
  
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  Avoiding New Production: The HTOC maintains the opinion that adequate global stocks of halons currently exist to meet the future service and replenishment needs of existing equipment until the end of their useful lives. However, the HTOC continues to be concerned of reported regional imbalances where excess agent supply in some regions reportedly cannot be used to meet shortages in other regions due to challenges presented by national or international regulations. Tipping this balance in supply and demand for halons by destroying unwanted but needed material too early concerns the HTOC, because this could result in an essential use exemption (EUE) nominations coming to the Parties and would represent an unacceptable step backward in the halon phase out under the Protocol.