Decision 77/49

Following the report of the contact group, the Executive Committee decided:

1. To approve, in principle, stage II of the HCFC phase-out management plan (HPMP) for China for the period 2016 to 2026 to reduce HCFC consumption by 37.6 per cent of the baseline by 2020 and to achieve the total phase-out of HCFCs in the polyurethane (PU) foam, extruded polystyrene (XPS) foam and the solvent sectors by 2026, in the amount of US $500,100,000, plus agency support costs to be determined at a future meeting, for UNDP, UNEP, UNIDO, the World Bank, the Government of Germany, the Government of Italy and the Government of Japan; and noting that the national HCFC consumption target, as well as the targets for the industrial and commercial refrigeration and air-conditioning (ICR) sector and the room air‑conditioning manufacturing and heat pump water heaters (HPWH) (RAC) sector for the period 2021 to 2026 would be determined when stage III of the HPMP was submitted;
2. To note:
   1. That the Agreement between the Government of China and the Executive Committee would be considered at the 79^th meeting and should include in Appendix 4-A (Format of Tranche Implementation Reports and Plans) the amount of co-funding provided by China for the HCFC reductions;
   2. That the tonnage of HCFCs eligible and non-eligible for funding to be deducted from the remaining consumption eligible for funding would be as stipulated in document UNEP/OzL.Pro/ExCom/76/25;
   3. That any interest accrued by the Government of China in the implementation of each of the sector plans of stage II of the HPMP would be reported annually and that the Treasurer would be requested to offset such interest against future transfers to the relevant implementing agency, in line with decision 69/24;
   4. That any remaining funds would be returned in line with paragraph 7(f) of the template Agreement for stage II of HPMPs (Annex XIX to document UNEP/OzL.Pro/ExCom/76/66);
   5. The maximum allowable consumption and tranche funding values would be as reflected in the following table:

XPS foam sector

3. To approve, in principle, the XPS foam sector plan of stage II of the HPMP for China for the period 2016 to 2026 for the complete phase-out of all HCFCs in that sector, in the amount of US $112,786,630 of the total amount approved in principle for stage II of the HPMP, plus agency support costs for UNIDO and the Government of Germany, to be determined at a future meeting;
4. To deduct 646 ODP tonnes of HCFC-142b and 1,640 ODP tonnes of HCFC-22 from the remaining HCFC consumption eligible for funding associated with the XPS foam sector;
5. To approve the first tranche of stage II of the HPMP for the XPS foam sector, and the corresponding tranche implementation plans, in the amount of US $7,514,867, plus agency support cost of US $526,041 for UNIDO;

PU rigid foam sector

6. To approve, in principle, the PU rigid foam sector plan of stage II of the HPMP for China for the period 2016 to 2026 for the complete phase-out of all HCFCs in that sector, in the amount of US $141,471,210 of the total amount approved in principle for stage II of the HPMP, plus agency support costs for the World Bank, to be determined at a future meeting;
7. To deduct 3,733.08 ODP tonnes of HCFC-141b from the remaining HCFC consumption eligible for funding associated with the PU foam sector;
8. To approve the first tranche of stage II of the HPMP for PU rigid foam sector, and the corresponding tranche implementation plan, in the amount of US $7,045,027, plus agency support costs of US $493,152 for the World Bank;

ICR sector

9. To approve, in principle, the ICR sector plan of stage II of the HPMP for China for the period 2016 to 2021 to achieve, by 2020, a 33 per cent reduction in relation to the 2013 maximum allowable consumption in the sector, in the amount of US $89,144,797 of the total amount approved in principle for stage II of the HPMP, plus agency support costs for UNDP, to be determined at a future meeting, on the understanding:
   1. That a maximum quantity of 3,150 metric tonnes in the unitary air-conditioning (UAC) sub-sector could be converted to HFC-32;
   2. That the Government of China would have flexibility in the UAC sub-sector to convert to alternatives with a lower global-warming potential (GWP) than HFC-32 as long as the cost and tonnage to be phased out remained the same;
   3. That the Government of China would have flexibility to convert heat-pump water‑heater (HPWH) lines to HFC-32 on the understanding that UAC and HPWH conversions to HFC-32 combined would not exceed 3,150 metric tonnes;
   4. That at least 20 per cent of the total phase-out of HCFC-22 in the ICR sector would be from the conversion of small and medium-sized enterprises (i.e. those consuming 50 metric tonnes or less);
   5. That, in sectors other than the UAC sector, the Government of China would have flexibility to select from among the six low-GWP technologies identified in Table 8 of document UNEP/OzL.Pro/ExCom/76/25, excluding HFC-32, and would make best efforts to ensure that the tonnage remained within 30 per cent of the amount specified for each technology in that table, at no additional cost to the Multilateral Fund, and that any deviation from that range would be reported to the Executive Committee for its consideration;
10. To deduct 477.79 ODP tonnes of HCFC-22 and 2.70 ODP tonnes of HCFC-123 from the remaining HCFC consumption eligible for funding associated with the ICR sector;
11. To approve the first tranche of stage II of the HPMP for ICR sector, and the corresponding tranche implementation plan, in the amount of US $13,368,756, plus agency support cost of US $935,813 for UNDP;

RAC sector

12. To approve, in principle, the RAC sector plan of stage II of the HPMP for China for the period 2016 to 2021 to achieve, by 2020, a 45 per cent reduction in relation to the 2013 maximum allowable consumption in the sector, in the amount of US $89,144,797 of the total amount approved in principle for stage II of the HPMP, plus agency support costs for UNIDO and the Government of Italy, to be determined at a future meeting, on the understanding that the Government of China agreed to convert at least:
    1. Twenty manufacturing lines for the production of RAC equipment to HC-290;
    2. Three compressor manufacturing lines to HC-290;
    3. Three HPWH manufacturing lines to HC-290;
    4. Two HPWH manufacturing lines to R-744;
13. To deduct 1,027.13 ODP tonnes of HCFC-22 from the remaining HCFC consumption eligible for funding associated with the RAC sector;
14. To approve the first tranche of stage II of the HPMP for the RAC sector, and the corresponding tranche implementation plans, in the amount of US $16,698,065, consisting of US $14,671,089, plus agency support costs of US $1,026,976 for UNIDO, and US $891,892, plus agency support costs of US $108,108 for the Government of Italy;

Solvent sector

15. To note that the sector plan for the solvent sector had been approved in principle by the Executive Committee at its 76^th meeting, in the amount of US $44,800,000, plus agency support costs for UNDP, to be determined at a future meeting;
16. To approve an additional US $2,462,566 of the total amount approved in principle for stage II of the HPMP for the project management unit for the solvent sector for stage II of the HPMP;
17. To approve the first tranche of stage II of the HPMP for solvent sector, and the corresponding tranche implementation plan, in the amount of US $2,821,937, plus agency support cost of US $197,536 for UNDP;

Refrigeration and air-conditioning servicing sector and enabling programme

18. To note that the sector plan for the refrigeration and air-conditioning servicing sector and enabling programme had been approved in principle by the Executive Committee at its 76^th meeting in the amount of US $20,290,000, plus agency support costs for UNEP, the Government of Germany and the Government of Japan, to be determined at a future meeting:
19. To approve the first tranche of stage II of the HPMP for the refrigeration and air-conditioning servicing sector and enabling programme, and the corresponding tranche implementation plan, in the amount of US $4,090,183, consisting of US $3,299,132, plus agency support costs of US $364,651 for UNEP, US $300,000, plus agency support costs of US $36,000 for the Government of Germany, and US $80,000, plus agency support costs of US $10,400 for the Government of Japan.