Ozone Layer Protection Programme in Indonesia Docs/hpmp/HPMP... · control milestones 2009-2010...

By Anton SRI PROBIYANTONO

OZONE LAYER PROTECTION PROGRAMME

IN INDONESIA

Historical Perspective and Progress as of 18 November 2014

BRIEF

11/18/2014 OZONE LAYER PROTECTION PROGRAMME IN INDONESIA 2

1970s

Scientists discovered

ODS

1985

Vienna Convention

for the Protection of the Ozone

Layer adopted

1987

Montreal Protocol on Substances that Deplete the Ozone

Layer signed

1992

Indonesia ratified Vienna

Convention, Montreal Protocol (MP) & London

Amendment

1993-2003

Indonesia implemented

a Country Programme

in compliance

with MP

2004-2010

Indonesia implemented

National Phase-out Plan (NPP) to comply

control milestones

2009-2010

Assessment on the

consumption of HCFC

2012- present

HCFC Phase-out

Management Plan (HPMP)

STATUS OF RATIFICATION


Indonesia ratified Montreal Protocol and its amendments as given the table below:

Agreement Date of Ratification

Signature Vienna Convention -

Signature Montreal Protocol 21.07.1988

Vienna Convention 26.06.1992

Montreal Protocol 26.06.1992

London Amendment 26.06.1992

Copenhagen Amendment 10.12.1998

Montreal Amendment 26.01.2006

Beijing Amendment 26.01.2006

http://ozone.unep.org/new_site/en/treaty_ratification_status.php

INTRODUCTION

• In the 1970s, scientists discovered certain man-made compounds contributed to the depletion of

the Ozone Layer. These are the Ozone Depleting Substances (ODS) that have both Ozone

Depletion Potential (ODP) and Global Warming Potential (GWP). These can be found in such

every-day household items as refrigerators, Styrofoam cups, spray deodorants and cushions.

• In 1984, international attention was drawn to the urgent need of appropriate measures when it

was confirmed that the Ozone Layer over Antarctica was disappearing.

• In 1985, the global community then adopted the Vienna Convention for the Protection of the

Ozone Layer.

• Then, in 1987, they signed the Montreal Protocol on Substances that Deplete the Ozone Layer.

• To follow up on the global commitment, on 26 June 1992, Indonesia ratified the Vienna

Convention, the Montreal Protocol and London Amendment.


ACTIVITIES OF THE MONTREAL PROTOCOL


• In 1993-2003, Indonesia implemented a Country Programme to address the needs of institutional

measures, regulatory framework, incentive and disincentive measures, awareness and

information dissemination, investment and technical assistance and monitoring in compliance with

the Montreal Protocol.

• In 2004-2010, Indonesia implemented National Phase-out Plan (NPP) to eliminate the remaining

consumption of ODS through a multi-year performance-based agreement to comply with the

control milestones.

ACHIEVEMENTS


1. Relevant government agencies (Ministries of Environment, Health, Trade, Industry, Agriculture,

etc) released various regulations in compliance with the Environmental Law 23/1997 and the

Montreal Protocol to control and prohibit the import/use of certain ODS in cosmetics, agriculture,

households, shipping, etc.

2. As of 2008, Indonesia has already banned the import of Chlorofluorocarbons (CFCs).

3. As of 2010, Indonesia is successfully in compliance with the Montreal Protocol control schedule

for CFCs, Carbon Tetrachloride (CTC) and Halons.

4. As of 2012 until today, Indonesia has been implementing various activities to phase-out the

consumption of Hydrochlorofluorocarbons (HCFCs) in coordination with Multilateral Fund (MLF)

Secretariat, Implementing Agencies (UNDP, World Bank, UNIDO and UNEP), the Government of

Australia, private sector and experts.

LESSONS LEARNED


1. In 1993-2003, the programme was implemented using a top-down approach considering the

relatively low level of capacity and awareness existing in the ODS consuming industry sectors, on

the Montreal Protocol obligations of the country. For instance, projects followed a direct/agency

execution mechanism, with technical requirements for industry conversions determined by

international experts and implementation of enterprise-level projects was overseen by

implementing agency officials and experts. As a consequence, many enterprises did not take full

ownership of the ODS phase-out.

2. Learning from previous experience, the Multilateral Fund adopted sector/national phase-out

approaches, through multi-year performance-based plans with annual targets and penalties for

non-compliance. During2004-2010, the sector phase-out plans for various ODS consuming

sectors were implemented in Indonesia. There was a much larger involvement of government and

industry stakeholders in implementation. This contributed to building knowledge and capacity at

the country-level for implementing complex, performance-based and technical programmes,

including decentralized enforcement and monitoring responsibilities for local governments.

NEXT STEPS


1. Considering the lessons learned during implementation of the Montreal Protocol during 1993-

2003 and 2004-2010, the Deputy Minister for Natural Resources Conservation Enhancement and

Environmental Degradation Control, the Ministry of Environment (MOE), through a decree

no.01/Dep.III/KLH/04/2009, established 4 (four) Technical Working Groups (TWGs) comprising of

designated members of private sector (manufacturing industries and servicing companies),

relevant government agencies, academicians and other stakeholders, to advise the government

on the strategy to be adopted for compliance with the accelerated phase-out schedule for HCFCs.

2. MOE designated UNDP to be the lead agency for the HPMP in Indonesia focusing on

Refrigeration, Air Conditioning (RAC) and Firefighting (FF) sectors. World Bank (WB) and UNIDO

were designated as the cooperating agencies. WB focuses on Polyurethanes Foams sector while

UNIDO focuses on solvents sector and one group project in the Foams sector. MOE also

cooperates bilaterally with the Government of Australia to assist on technical aspect of refrigerant

management.

3. Facilitated by UNDP, GOI was working together with WB, UNIDO, with over 137 manufacturing

companies and over 2,000 servicing workshops to collect data, analyze it and prepare the

Indonesia HPMP Stage-I proposal.

NEXT STEPS


4. Industries were fully involved in the process together with government officials and experts.

5. As a result, GOI was able to submit a HPMP Stage-I proposal that accommodated the integrated

needs of Indonesia for compliance with the 2013 and 2015 control targets for HCFCs.

6. Indonesia’s HPMP Stage-I was approved by the Executive Committee of the Multilateral Fund in

its 64 meeting in July 2011 (ExCom Decision 64/42), noting with appreciation the exemplary

policy and other initiatives in the proposal

7. According to the agreed HCFC consumption targets, Indonesia will need to freeze its HCFC

consumption at the level of 403.92 ODP tonnes by 01 January 2013, reduce it to 363.53 ODP

tonnes from 01 January 2015 and to further reduce it to 323.14 ODP tonnes by 01 January 2018.

CONCLUSION


• ODS consuming industrial sectors are the heart of the Ozone Protection (Montreal Protocol)

Programme. These industries produce, store, consume, distribute and release the ODS through

their manufactured and/or serviced products. Their active engagement in the decision-making

processes is critical to freeze, reduce and eliminate ODS, with the assistance of designated

Implementing Agencies for Indonesia (UNDP, WB and UNIDO) and relevant government agencies

(Ministry of Environment, Ministry of Trade, Ministry of Health, Ministry of Finance/Directorate

General of Customs and Excise, Ministry of Energy and Mineral Resources, local governments),

experts and other relevant stakeholders. This would facilitate the enactment of forward-looking

regulations that would ensure compliance with the HPMP targets and also maximize climate

benefits.

• Industries’ active engagement in the process of the programme preparation and implementation

has been able to trigger higher interest of private sectors in promoting the importance of the

Ozone Layer Protection and Climate Change mitigation. The industries are encouraged to

propose their own data and targets to accelerate the progress. The road map to control the target

is clearer. It will not only give impact locally but also globally.

• The partnership is expected to strengthen the efforts of Indonesia in compliance with the Montreal

Protocol.

HYDROCHLOROFLUOROCARBONS (HCFC)

PHASE-OUT MANAGEMENT PLAN (HPMP)

Existing Programme

11/18/2014 OZONE LAYER PROTECTION PROGRAMME IN

INDONESIA 11

GENERAL INFORMATION


Project Title: HCFC Phase-out Management Plan (HPMP) for Compliance with

the 2013 and 2015 Control Targets for Annex-C, Group-I

Substances (HCFCs) in Indonesia

Objective: To reduce 80.4 ODP tonnes in the national HCFC consumption by

2018. In addition, the project will result in net CO2 equivalent direct

emission reduction of about 1.5 million tonnes annually from 2015.

UNDP Award ID/ Project ID: 00065312/ 00081873

Implementing Partner: Ministry of Environment

(Assistant Deputy for Atmospheric Function Preservation and

Climate Change Mitigation)

Start Date: 01 June 2012

End Date: 31 December 2018

Project Appraisal Committee

(PAC) Meeting:

27 March 2012

GENERAL INFORMATION


Donor: Multilateral Fund (MLF)

MLF Project Numbers: IDS/PHA/64/TAS/192

IDS/PHA/64/INV/193

IDS/PHA/64/INV/195

UNDP Award ID/ Project ID: 00065312/ 00081873

Period of Implementation: 2012-2018 (Stage-I)

Start Date: 01 June 2012

End Date: 31 December 2018

Prodoc signatures: 28 August 2012

by Ministry of Environment, Ministry of Finance and UNDP

Total Resources: Managed UNDP for Indonesia: US$ 8,901,102

Managed by WB for Indonesia: US$ 2,714,187

Managed by UNIDO for Indonesia: US$ 777,395

Total: US$ 12,392,684

BACKGROUND


• Indonesia acceded to the Vienna Convention and ratified the Montreal Protocol on Substances

that Deplete the Ozone Layer in June 1992. As of January 2006, Indonesia has ratified all the

amendments to the Montreal Protocol.

• Indonesia is classified as a party operating under Paragraph-1, Article-5 of the Montreal Protocol

(MP) qualified to receive technical and financial assistance.

• Indonesia has prohibited imports of Chlorofluorocarbons (CFCs), Halons and Carbon

Tetrachloride (CTCs) as of 1 January 2008.

• Indonesia’s HCFC Phase-out Management Plan (HPMP Stage-I) comprises of a combination of

interventions such as: technology transfer investments, policies and regulations, technical

assistance, training, awareness and communications and management, coordination and

monitoring in various HCFC consuming sectors.

• The most popular one that we know is “Freon” (produced by DuPont).

• HCFCs are used in Refrigeration (Ref), Air Conditioner (AC), Foams, Fire Fighting and solvents.

• Predominant HCFCs are HCFC-22 (RAC sectors).

• HCFCs are classified as controlled substances under Annex-C, Group-I of MP and subject to the

adjusted control schedule for Article-5 countries.

• Indonesia has to freeze the consumption of HCFC at baseline levels from 2013 and reduce 10%

from baseline levels as of 2015.

WHAT ARE HCFCS?

15

MONTREAL PROTOCOL DECISIONS

Recognizing the environmental benefits (ODP & GWP reductions), the XIX Meeting of Parties to

the Montreal Protocol (Sep.2007: XIX/6) accelerated the HCFC phase-out schedule as follows:

16

Step Activity Time

1st Control Freeze of production & consumption at Baseline

Level

As of 01 Jan 2013

2nd Control Reduction of 10% (from Baseline Level) As of 01 Jan 2015

Subsequent

Control

Reduction of 35% 2020

Reduction of 67.5% 2025

Reduction of 97.5% 2030

Complete phase-out As of 01 Jan 2040

CONSUMPTION OF HCFC (2007-2009)

Substance

2007 2008 2009

Metric

Tonnes

ODP

Tonnes

Metric

Tonnes

ODP

Tonnes

Metric

Tonnes

ODP

Tonnes

HCFC-141b 1,008 110.8 874 127.7 1,186 130.5

HCFC-22 3,094 170.2 3,668 201.8 4,327 237.9

HCFC-123 288 5.8 92 1.8 318 6.4

HCFC-225 - - 1 0 1 -

Total 4,390 286.8 4,635 331.3 5,832 374.8

17

PROJECTED HCFC CONSUMPTION

340.00

350.00

360.00

370.00

380.00

390.00

400.00

410.00

PROJECTED HCFC BASELINE 2009-2010

MAX CONSUMPTION LEVEL FROM 01 JAN 2013 - DEC 2014

MAX CONSUMPTION LEVEL AS OF 01 JAN

2015

Pro

ject

ed f

rom

th

e co

nsu

mp

tio

n o

f R

/AC

, FF,

Fo

ams

& S

olv

ents

18

STAGE-I (2012-2015) TARGETS

Note: there will be Stage-II (2015-2020) & subsequent targets established later.

STRATEGIC APPROACH


Approach Activities

Partnership Joint programme among Implementing Agencies (UNDP, WB,

UNIDO & UNEP), government agencies and private sector

(industries and associations)

Implementing/ Bilateral Agencies: 1. UNDP (Lead Agency)

2. Australia (Bilateral Cooperating Agencies)

3. World Bank (Cooperating Agency)

4. UNIDO (Cooperating Agency)

National Coordinating Agency: Ministry of Environment

Components: 1. Investment

2. Non Investment (policies, regulations, capacity

development, etc.)

Prioritization: 1. Focus of Stage-I: Manufacturing (2012-2015)

2. Focus of Stage-II: Servicing (2015-2020)

ROAD MAP

Milestones 2012 2013 2014 2015 2016 2017 2018

HCFC CONSUMPTION LIMIT (ODP Tonnes) N/A 403.92 403.92 363.53 363.53 363.53 323.14

TECHNOLOGY CONVERSIONS

• Finalization of implementation plan X

• Enterprise level agreements X

• Enterprise level conversions X X

• Commissioning X X X

PROJECT MANAGEMENT

• Finalization of implementation plan X

• Regulations development X X

• Enforcement X X X X X X X

• Monitoring & coordination X X X X X X X

• Awareness & capacity-building X X X X X X X

• Stakeholder consultations X X X X X X X

• Performance verification X X X X X

20

COMPANY CATEGORY


HPMP Stage-I

• Group-1 Enterprises (Refrigeration and Air Conditioner Manufacturing Companies)

• Group-2 Enterprises (Refrigeration and Air Conditioner Assembling Companies)

• Group-3 Enterprises (Refrigeration and Air Conditioner Installing Companies)

HPMP Stage-II

• HCFC-22 phase-out: servicing sector

• HCFC-123 phase-out in Fire Fighting applications

PROJECT BOARD

Senior Beneficiary Ministry of Environment, Ministry of Industry,

Ministry of Trade, Customs, Statistics, Industry

(private sector)

Executive Assistant Deputy for Atmospheric Function

Preservation and Climate Change Mitigation,

Deputy Minister for Environmental

Degradation Control and Climate Change

Senior Supplier UNDP

Project Assurance UNDP National Project Manager

Project Support 1. Project Assistance

2. Project Clerk

Air Conditioning Team Refrigeration Team Technical Coordinator

HPMP PROJECT ORGANIZATION STRUCTURE

PROGRESS AS OF 18 NOVEMBER 2014


Investment

• 7 RAC manufacturing companies (group-1) signed Memorandum of Agreement (MoA) to change their technology of production in Le Meridien Hotel, Jakarta on 20 March 2013. Later on, 1 AC manufacturing company signed MoA on 18 June 2013.

• 9 refrigeration assembling companies (group-2) are willing to proceed with HPMP

• 8 refrigeration installing companies (group-3) will receive Incremental Capital Cost (IOC)

• Other companies on RAC will change their technology to use non HCFC

Regulatory Framework:

• As of 1 January 2015, HCFC will be banned for refrigeration and air conditioner production process, blowing agent in domestic refrigeration, freezer thermoware, refrigerated trucks and integral skins, and imported goods that contain such substance. Accordingly, there are a number of decrees that have issued by relevant government agencies, i.e.:

• Decree of Minister of Trade Number 55/M-DAG/PER/9/2014 concerning the Terms and Conditions of Imported Cooling System Based Goods

• Decree of Minister of Industry Number 41/M-IND/PER/5/2014 concerning the Prohibition of Hydrochlorofluorocarbon (HCFC) in Industrial Sector

PROGRESS AS OF 18 NOVEMBER 2014


Regulatory Framework:

• National quotas are updated regularly (such as the issuance of letters by relevant Deputy Minister

Number B-12012/Dep.III/LH/12/2011 concerning National Quota for 2012 and B-

12581/Dep.III/LH/PPLH/12/2012 concerning National Quota for 31 HCFC Importers).

Introduction of New Technology

• The National Ozone Unit (NOU) invited manufacturing companies, especially the grant recipients,

to new technology conference in Bangkok, Thailand (July 2013).

• NOU also facilitated the promotion of new technology in several workshops in Jakarta, Indonesia.

Due Diligence on the Recipient Sites

• A Team consisting of officials of Ministry of Environment, UNDP and experts visited companies

interested in the project.

The Establishment of an Association

• Relevant industries agreed to establish Asosiasi Manajemen Refrigeran Indonesia (AMRI) or

Indonesia Refrigerant Management Association on 4 September 2013 in Jakarta.

MILESTONES OF GROUP-1


1. Implementation work plan comprising of the following:

• Overall activity schedule; Specifications of product models to be re-designed; Plant re-layout

drawings as applicable.

2. Plant and process modifications comprising of:

• Issuance of purchase orders/ contracts for major equipment and/or modifications thereof.

3. Installation comprising of:

• Installation of new/ retrofitted equipment; Completion of local civil, electrical and mechanical

works; Installation of safety systems as applicable.

4. Trials and commissioning comprising of:

• Product prototypes; Product testing; Trial production; Personnel training for operation,

maintenance and safety.

5. Completion and phase-out of HCFCs:

• Exhaustion of HCFC stocks; Disposal of redundant baseline equipment as applicable;

Product external certification as applicable.

Note: the milestones are stated in Memorandum of Agreement (MoA0 betweeen Ministry of Environment and companies

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