For the latest in the occasional dog-bites-man stories that tend to pique my interest, let’s turn to the global specialty chemical industry. A few weeks ago, some of the world’s largest chemical manufacturers not only agreed to but actively promoted new restrictions on their ability to manufacture and sell a commercially important class of refrigerants that are very widely used in air conditioning units, heat pumps, and refrigeration equipment. As it happens, these refrigerants — hydrofluorocarbons (HFCs) — are also powerful greenhouse gases (GHGs), making their continued, and growing, use problematic from the standpoint of addressing global climate change.
The new restrictions are found in an amendment to the Montreal Protocol, a ground-breaking treaty signed by scores of nations in 1987 for the purpose of eliminating certain industrial gases that were causing the ozone layer in the stratosphere to deteriorate. This treaty is widely viewed as a great success, both because it was effective in reducing use (and subsequent releases) of the chemicals in question (chlorofluorocarbons (CFCs)) and because these reductions have allowed the then rapidly growing hole in the ozone layer to, effectively, heal over the past 30 years or so. Then as now, forward-looking executives in the chemical companies that would be most affected by a chemical phase-out have actively supported it, and for good business reasons. They realized that demand for their products (and related profits) would fall over time, for several reasons. Patents were expiring, manufacturing know-how was spreading to lower-cost geographies, and demands were growing to curtail these environmentally harmful products. DuPont, which had a very high share of the global CFC market, helped to lead the charge.
Past is prologue—among the more vocal supporters of the new agreement are such chemical industry heavyweights as Honeywell and Chemours, a DuPont spinoff. And it is no coincidence that these companies have developed alternatives to HFCs that are effective and much more climate-friendly. They enjoy first-mover advantages in bringing these new products to market.
The new treaty was signed by representatives of more than 170 nations in Kigali, Rwanda, following seven years of negotiations. Unlike the recently enacted Paris Climate Accords, this agreement carries the force of law. And although it focuses on only one class of GHG, given the potency of HFCs and their widespread use, the provisions of this amendment to the Montreal Protocol may prevent as much as 0.5° C in global temperature rise over the coming decades. Many environmental groups are reportedly not impressed by the perceived slow pace of implementation, but even they recognize that getting an agreement signed that has this level of potential impact is an important step forward. See a good story in the New York Times here: http://www.nytimes.com/2016/10/15/world/africa/kigali-deal-hfc-air-conditioners.html?_r=1
In this time of turbulent politics and suspicion of new regulations and restraints on industry, it is reassuring to see that reasonable people having very different interests and perspectives can work together to get important things done, and that enlightened (though self-interested) business people can play important, even catalytic, roles.
