New Zealand's phase down of hydrofluorocarbons to ratify the Kigali Amendment to the Montreal Protocol and associated supporting measures

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1 Ministry for the Environment Mariam Afo Te Taiao New Zealand's phase down of hydrofluorocarbons to ratify the Kigali Amendment to the Montreal Protocol and associated supporting measures SUBMISSION FORM The Government is seeking views on how to implement a phase down of hydrofluorocarbons (HFCs), a greenhouse gas, in New Zealand. Feedback is sought on the proposed controls, including an import permitting system, which would need to be put in place if New Zealand ratifies the Kigali Amendment to the Montreal Protocol. For more information about the Government's proposals read our consultation document. Submissions close at 5.00pm on Friday 23 June Making a submission You can provide feedback in three ways: 1. Use the online submission form available at This is our preferred way to receive submissions. 2. Complete this submission form and send to us by or post. 3. Write your own submission and send to us by or post. Publishing and releasing submissions All or part of any written submission (including names of submitters) may be published on the Ministry for the Environment's website Unless you clearly specify otherwise in your submission, we will consider that you have consented to website posting of both your submission and your name. Contents of submissions may be released to the public under the Official Information Act 1982 following requests to the Ministry for the Environment (including via ). Please advise if you have any objection to the release of any information contained in a submission and, in particular, which part(s) you consider should be withheld, together with the reason(s) for withholding the information. We will take into account all such objections when responding to requests for copies of, and information on, submissions to this consultation under the Official Information Act. The Privacy Act 1993 applies certain principles about the collection, use and disclosure of information about individuals by various agencies, including the Ministry for the Environment. It governs access by individuals to information about themselves held by agencies. Any personal information you supply to the Ministry in the course of making a submission will be used by the Ministry only in relation to the matters covered by this consultation. Please clearly indicate in your submission if you do not wish your name to be included in any summary of submissions that the Ministry may publish.

2 Submission form The questions below are a guide only and all comments are welcome. You do not have to answer all the questions. To ensure your point of view is clearly understood, please explain your rationale and provide supporting evidence where appropriate. Contact information Name* S; q (-Z ) 00 ) Organisation (if applicable) Address CoolDrive Distributions Lexton Road Box Hill Victoria 3128 Australia Phone (613) * Submitter type* S q0. )(ii ) Individual NGO Business / Industry Local government Central government Iwi Other (please specify) * Questions marked with an asterisk are mandatory. How HFCs are used in New Zealand 1. How would you characterise the use of HFCs in New Zealand in the different sectors? Automotive PMV / Heavy Vehicle / Agricultural / Machinery - For use in vehicle A/C and Climate control systems to ensure driver safety, through comfort and necessity to dehumidify cabins for safe clear driver vision. Current OH&S guidelines demand specific work temperature environments that are not achievable without use of A/C systems. 2. Are there alternatives to HFCs available in your business sector? Please provide evidence where possible. No Automotive Manufacturers have responded to HFC phase down requirements with the introduction of HFC refrigerant HFO-1234yf into newly manufactured vehicle platforms. Although still a HFC, the relevant GWP is 4, compared to R134a GWP rating at CoolDrive are actively importing HFO-1234yf to accommodate all demands and reduce use of R134a. This approach has been adopted by CoolDrive branches within New Zealand. 2

3 Limited Automotive manufacturers are releasing new vehicle platforms with CO2 equipped A/C and Climate Control systems, reducing further the GWP to What are the costs and benefits of the phase down on your business? Please provide evidence where possible. Current refrigerant decanting processes must be revised to accommodate lower GPW rated, flammable (HFO-1234yf) and/or increased pressure rated (CO2) refrigerants. Preliminary assessments indicate a cost impact in the vicinity of $200, This assessment is sometime from being finalised. There is no cost benefits related to the proposed phase down. Proposed import permitting system 4. Do you agree with the Government's preferred option for inclusion in the proposed import permitting system? 5. What would the impact of this approach be? Please provide evidence where possible. There is limited opportunity to agree to "portions only" of the Proposed Importing Permitting System CoolDrive agree that an import permit system that meets international obligations is necessary, and should remain fair between domestic and International companies. A section of the Preferred Option supports "incentivising a shift to alternates, because they will not require import permits". These alternates will encourage uncontrolled, flammable refrigerant use that is not approved or recommended by vehicle manufacturers. Dangerous work practices and safety risks to service agents are proven results of use within the Australian market. 6. What other options should be considered and why? Please provide evidence where possible. Serious consideration regarding what the original manufacturer of appliance, machine or vehicle intentions were in respect to type of refrigeration this item was designed to use. Redirecting the service agent to use an alternate refrigerant encourages use of non-original manufacturer intended refrigerant consumption. This may lower the overall GWP targets, but will jeopardise equipment / component integrity if not performed successfully. This can be avoided by introducing a "users licencing" system, which is available to users (service agents) once a competent handling of refrigerant is demonstrated. This competency is reliant on use of approved refrigerant recovery equipment and recording refrigerant usage. The Australian Refrigeration Council has this template in place. (clarification is required regarding exclusion of HFC's that are already "covered by the New Zealand Emissions Trading Scheme" - CoolDrive report all importation qty's of R134a and R404a to NZETS, and surrender all appropriate carbon credits - Are these two refrigerants excluded from this overall proposal based on detail top page 17?) 7. Do you agree with the proposed approach on who should have an import permit? 3

4 No 8. What would the impact of this approach be? Please provide evidence where possible. CoolDrive agrees that importers should hold the primary "import permits", however it is correctly highlighted that "end users" will then not have access to an HFC permit. This must be rectified by structuring two permit system. 9. What other options should be considered, and why? Please provide evidence where possible. A two permit system should be considered as - A/ Importing permit. (Wholesale, distribution) B/ User permit. (Service agent) Both would hold different areas of responsibility and accountability, but would jointly hold the responsible for safe use and minimising "refrigerant venting" within NZ atmosphere ultimately reducing environmental impact and importation volumes. 10. Do you agree with the proposed approach on how the baseline and phase-down steps should be designed? 11. What would the impact of this approach be? Please provide evidence where possible. question whether the proposed baseline and phase down places New Zealand industry in a position where targets are beyond those acknowledged as fair and reasonable by all other countries. The impact is greater pressure on NZ industry to meet guidelines that are beyond what has been recognised globally as achievable. 12. What other options should be considered, and why? Please provide evidence where possible. The key alternate option is to reward recycling and reuse of HFC's, promoting the safe recovery and recycle of HFC's for reuse - this restricts overall import volumes, while continuing to service the industry demands. 13. Do you agree with the proposed approach on how the permits should be allocated? 14. What would the impact of this approach be? Please provide evidence where possible. Allocating 80% market share to Grandfather Permits simply based on history is restrictive to any new importer that is prepared to import and manage the refrigerant responsibly. CoolDrive have managed refrigerant sales within Australia through R12 supply, retrofitting periods across to R134a and now HFO-1234yf. The business is trusted with the responsibility to collect recovered R134a refrigerant and manage the decant to bulk cylinders and return to Refrigerant Reclaim Australia. CoolDrive work very closely with Australian Refrigeration Council and your criteria 4

5 would eliminate this company and our experience with responsible refrigeration handling from your market. 15. What other options should be considered, and why? Please provide evidence where possible. Each importer should have the need to provide adequate evidence that they can handle and distribute the refrigeration products professionally, ensuring minimal impact on environment. 16. Do you agree with the proposed approach on how HFCs should be reported? 17. What would the impact of this approach be? Please provide evidence where possible. Demanding reporting methods from importers is expected and agreed, however the refrigerants are then on sold to end users and/or service agents. These end users must also be responsible to report their usage as their handling methods have the most impact on environment. 18. What other options should be considered, and why? Please provide evidence where possible. If compulsory recovery was introduced to the service agent, and compulsory reporting implemented, more refrigerant would be recovered, recycled and reused ultimately reducing the need to import virgin refrigerant. Other proposed rules 19. Do you agree with the proposed approach on how recycled imports of HFCs should be managed? 20. What would the impact of this approach be? Please provide evidence where possible. It is not viable to import recycled refrigerant, as it's not a manufacturing process in place within any region. 21. What other options should be considered, and why? Please provide evidence where possible. The drive to recycle refrigerants must start with the service agent - they are hands on at the appliance / machine / vehicle and determine the end of life status of any refrigerant. Reward for recovery and recycle by a licenced service agent will reduce the need to import virgin refrigerant. 22. Do you agree with the proposed approach on how the exports of HFCs should be managed? 23. What would the impact of this approach be? Please provide evidence where possible. s

6 Not rewarding companies that export, by subsidising equivalent export volumes with same import quotas will simply discourage export from NZ industry. 24. What other options should be considered, and why? Please provide evidence where possible. Any importer that also exports a volume of HFC, within the same licence period should be allowed to redeem that volume until end of next licence period. 25. Do you agree with the proposed approach on how the manufacture of HFCs should be managed? No 26. What would the impact of this approach be? Please provide evidence where possible. 27. What other options should be considered, and why? Please provide evidence where possible. 28. Do you agree with the proposed approach on how non-party trade provisions should be managed? No 29. What would the impact of this approach be? Please provide evidence where possible. 30. What other options should be considered, and why? Please provide evidence where possible. Reducing demand for HFCs, and moving to alternatives 31. What barriers/issues do you face to move to alternatives to HFCs? Barriers are predicted by Automotive vehicle manufacturers, as they progressively manufacturer vehicles with low GWP (HFO-1234yf), CoolDrive progress into distribution of this refrigerant and appropriate service tools. The industry must be educated as to the format of transition from R134a to HFO-1234yf. This can only be achieved as vehicles present, and to encourage a faster elimination of R134a by introducing non OE approved lower GWP alternate refrigerants will introduce practices against OE manufacturer specifications. 32. What would reduce your demand for high-gwp HFCs? The fast track of vehicle manufacturing with HFO-1234yf and CO2 A/C and Climate Control systems. 33. What are your suggestions for supporting measures? Please be as specific as possible. 6

7 The Automotive industry must be responsible as a whole for the use of high GWP refrigerants. The only way to reduce importation volumes is to introduce mandatory recovery and recycle process, and insist these processes are performed by licensed service agents who understand the impact to environment and business benefits of recovering refrigerants. Greater volumes recovered / recycled from vehicles reduce import quantities. 34. Which problems would these measures address? The need to establish and industry standard to achieve to be licensing status is at a cost. The process of licencing service agents is at a cost. This cost will be debated as unnecessary by the service agents. The tooling requirements will be at a cost to the service agents. 35. What would be the impact on New Zealand of these measures being put in place? The negative impact is cost related. The positive impact is a more responsible automotive industry, which targets the core solution to reducing initial importation of high GWP refrigerants. Other comments 36. Do you have any further comments you wish to make about the Government's proposals? CoolDrive would welcome the opportunity to present broader detail regarding our current refrigerant operation, which controls importation, distribution and recovery of reclaimed refrigeration's within the Australian Automotive industry. This is all done within the guidelines and requirements of Refrigerant Reclaim Australia and the Australian Refrigeration Council. Our intentions are to continue to import refrigerants into NZ market and maintain those same stringent guidelines. The current permit proposal denies us the business opportunity simply because we chose not to enter the refrigerant market within NZ until after This restricts any company with considerable experience that has invested substantial cost and effort into supporting and maintaining a responsible refrigerant handling program. Releasing submissions Your submission may be released under the Official Information Act 1982 and may be published on the Ministry's website. Unless you clearly specify otherwise in your submission, we will consider that you have consented to website posting of both your submission and your name. Please check this box if you would like your name, address, and any personal details withheld. Note that the name, , and submitter type fields are mandatory for you to make your submission. When your submission is complete If you are ing your submission, send it to HFCConsultation@mfe.govt.nz as a: PDF 7

8 Microsoft Word document. If you are posting your submission, send it to HFC Consultation, Ministry for the Environment, PO Box 10362, Wellington Submissions close at S.00pm on Friday 23 June s