COMMISSION STAFF WORKING DOCUMENT EXECUTIVE SUMMARY of the IMPACT ASSESSMENT Review of Regulation (EC) No 842/2006 on certain fluorinated greenhouse gases Accompanying the document Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on fluorinated greenhouse gases
Date: 2012-11-07
Institutions: European Commission
Subjects: climate change, disclosure of information, environmental monitoring, environmental standard, greenhouse gas, marketing standard, reduction of gas emissions, stratospheric pollutant

EUROPEAN 
COMMISSION 

Brussels, 7.11.2012  
SWD(2012) 363 final 

COMMISSION STAFF WORKING DOCUMENT 

EXECUTIVE SUMMARY of the IMPACT ASSESSMENT 
Review of Regulation (EC) No 842/2006 on certain fluorinated greenhouse gases 

Accompanying the document 

Proposal for a 
REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

on fluorinated greenhouse gases 

{COM(2012) 643 final} 
{SWD(2012) 364 final} 

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1. 

INTRODUCTION 

F-gases1 are increasingly used in a number of different application fields, such as refrigeration 
&  air  conditioning,  foams,  aerosols,  fire  protection  and  electrical  equipment.  F-gases  are, 
however,  very  potent  climate  gases.2  The  current  F-gas  Regulation  focuses  mainly  on 
reducing emissions of these greenhouse gases during the lifetime of equipment and its end-of-
life treatment, while it hardly restricts the use of F-gases in new equipment. At the same time, 
alternatives to F-gases that are safe and energy-efficient are already available today in nearly 
all fields of application. 

The  Commission  published  a  report  on  the  application,  effects  and  adequacy  of  the  F-gas 
Regulation.3  Certain  implementation  shortcomings  were  identified  which  need  to  be 
addressed. If fully applied, the F-gas Regulation in combination with the Directive on mobile 
air-conditioning  (Directive  2006/40/EC)  could  freeze  F-gas  emissions  at  today's  levels. 
However,  the  report  also  concluded  that  the  EU  should  take  additional  action  on  F-gases, 
given the potential to further reduce emissions at relatively low costs.  

Similarly, the European Parliament has repeatedly called for ambitious action in this field.4,5  

At the international level, more than 100 countries are calling for action on F-gases under the 
Montreal  Protocol  on  Substances  that  Deplete  the  Ozone  Layer.6  The  EU  has,  since  2009, 
supported  in  principle  the  proposals  made  for  a  global  phase-down  under  the  Montreal 
Protocol. In addition the initiative "Climate and Clean Air Coalition on Short-Lived Climate 
Pollutants",  which  includes  the  US,  G8  countries,  the  European  Commission  (EC),  World 
Bank and UNEP, promotes various actions on F-gases.7 

2. 

PROBLEM DEFINITION 

Climate  change  affects  everybody  in  terms  of  extreme  weather  conditions  and  adaptation 
costs. The international scientific consensus calls for limiting the global temperature increase 
to  2˚C  to  avoid  undesirable  climate  effects.8  In  total,  F-gases  account  for  2%  of  all 
greenhouse  gases  in  the  EU  today  but  have  a  much  more  potent  atmospheric  warming 
potential than CO2. According to the cost-effective pathway to decarbonise the EU economy, 
emissions of F-gases should be reduced in the order of 70-78% by 2050 and by 72-73% by 

1 

2 
3 

4 

5 

6 
7 
8 

F-gases include hydrofluorocarbons (HFCs), perfluorocarbons (PFCs) and sulphur hexafluoride (SF6). 
By weight, 98% of F-gases placed on the market in the EU were HFCs (2010 data). 
F-gases have global warming potentials that is up to 23,000 times stronger than that of CO2.  
COM(2011)  581.  "On  the  application,  effects  and  adequacy  of  the  Regulation  on  certain  fluorinated 
greenhouse gases (Regulation (EC) No 842/2006)". 26 September 2011. ec.europa.eu/clima/policies/F-
gas/docs/report_en.pdf  
European  Parliament  Resolution  of  14  September  2011.  "A  comprehensive  approach  to  non-CO2 
climate relevant anthropogenic emissions." P7_TA-PROV(2011)0384. 
European  Parliament  Resolution  of  15  March  2012.  "Competitive  low  carbon  economy  in  2050  –  EP 
resolution on a Roadmap for moving to a competitive low carbon economy in 2050" (2011/2095(INI)), 
P7_TA-PROV(2012)0086. 
ozone.unep.org/Meeting_Documents/mop/22mop/MOP-22-9E.pdf  
www.unep.org/ccac/ 
IPCC,  4th  Assessment  Report,  Climate  Change  2007:  Working  Group  III:  Mitigation  of  Climate 
Change. www.ipcc.ch/publications_and_data/ar4/wg3/en/contents.html  

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2030  at  a  marginal  abatement  cost  of  approximately  €50  per  tonne  CO 2  equivalent.9  This 
translates  for  the  F-gas  sector  to  a  decrease  of  ca.  70  million  tonnes  CO2  equivalents  (Mt 
CO2eq)  as  compared  to  emissions  expected  in  2030  under  a  full  application  of  current 
legislation. 

Global  F-gas  use  has  been  growing  rapidly  since  1990  and  will,  if  unaddressed,  lead  to  a 
considerable increase in emissions. Since equipment and products containing F-gases have a 
long lifetime of up to 50 years (e.g. building insulation foams), a lack of public intervention 
today would result in unnecessary, high emissions for many decades.  

Therefore, apart from addressing existing shortcomings in the application of the current F-gas 
Regulation  there  is  a  strong  need  to  further  reduce  future  emissions.  Analysis10  shows  that 
two-thirds of the expected emissions11 in the EU could be avoided cost-efficiently12 by 2030, 
if action is taken to avoid the use of F-gases where suitable alternatives exist. Cumulatively, 
emission savings of ca. 625 Mt CO2eq can be achieved cost-efficiently over the period from 
2015 until 2030.  

Lack of action in this area would result either in the EU missing its greenhouse gas emission 
objectives or require other industrial sectors to take more expensive action, thus causing a loss 
of cost competitiveness for industry as a whole.  

In  addition,  there  is  an  unexploited  potential  to  encourage  the  market  penetration  of  green, 
alternative technologies, thus stimulating innovation, green jobs and growth.13  

3. 

POLICY OBJECTIVES 

The  general  objective  of  the  review  of  the  F-gas  Regulation  is  to  ensure  a  cost-efficient14 
contribution to reducing greenhouse gas emissions in the EU by 80 to 95% in 2050 within the 
global challenge of keeping climate change below 2ºC of pre-industrial levels.  

This should be achieved in particular by  

– 

– 

– 

9 

10 

11 
12 
13 

14 

discouraging the use of F-gases with high GWP where suitable alternatives exist; 

encouraging the use of alternative substances or technologies without compromising 
safety, functionality and energy efficiency; 

preventing  leakage  from  equipment  and  proper  end  of  life-treatment  of  F-gas 
applications; 

greenhouse 

COM  (2011)  112.  "A  roadmap  for  moving  to  a  competitive  low  carbon  economy  in  2050."eur-
lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:52011DC0112:EN:NOT  
Schwarz  et  al.  (2011)  "Preparatory  study  for  a  review  of  Regulation  (EC)  No  842/2006  on  certain 
ec.europa.eu/clima/policies/F-
fluorinated 
gas/docs/2011_study_en.pdf  
Projected under the assumption that the F-gas Regulation is fully implemented. 
Often far below €50 / tonne CO 2eq 
Many of these "green growth" companies, often SMEs, have stated that they find it hard to market their 
products under current market conditions.  
Abatement costs below €50 per tonne of CO 2 abated are considered cost-efficient. 

gases."  Öko-Recherche 

al. 

et 

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– 

– 

– 

facilitating  convergence  towards  a  potential  future  agreement  to  phase  down  HFCs 
under the Montreal Protocol; 

enhancing sustainable growth, stimulate innovation and develop green technologies; 

limiting  any  undesirable  effects  on  SMEs,  competitiveness  and  employment,  the 
administrative burden for companies and authorities and preserving the competition 
in the Internal Market, to the extent possible.  

4. 

POLICY OPTIONS 

The impact assessment considers five policy options. The first option analysed is "no policy 
change"  (Option  A)  which  introduces  no  new  legislative  requirements  but  does  include 
clarifications  on  definitions  and  non-legislative  action  at  EU  level  to  support  a  better 
application  of  the  existing  requirements.  Current  legislation  is  considered  essential  but 
insufficient  to  reach  the  objectives  and  hence  it  is  used  as  the  baseline  against  which  four 
supplementary policy options are assessed: 

– 

– 

– 

– 

Option  B:  The  use  of  "voluntary  agreements"  among  industry  players  in  sectors 
where such agreements were considered realistic due to low abatement costs;  

Option  C:  The  option  "extending  scope  of  containment  and  recovery"  requires 
containment in sectors currently not covered by the F-gas Regulation;  

Option D: The "phase-down" option introduces step-wise declining limits until 2030 
for the amounts of HFCs that can be put on the EU market. This option also includes 
measures targeting HFCs in pre-charged equipment, to avoid that only EU-produced 
products would be affected by the cap;  

Option  E:  "Bans"  on  the  use  of  F-gases  in  sectors  where  replacement  technologies 
are already available today for 100% of the applications.  

Some of these policy options and the measures included thereunder are not mutually exclusive 
and may be combined with other policy options considered.  

Further  options  and  sub-options  have  been  screened  and  discarded  on  the  basis  of  four 
criteria: 

– 

– 

– 

– 

Effectiveness (less than 1 Mt CO2eq); 

Efficiency (more than 50 € per t CO 2eq abated); 

Technical constraints like safety or energy efficiency; 

Other constraints such as consistency with other EU policies.  

Hence, all the chosen options and their sub-options are from the onset effective, cost-efficient, 
energy-efficient  and  safe,  as  health  and  greenhouse  gas  lifecycle  concerns  are  inherently 
addressed in the screening analysis. 

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5. 

IMPACTS 

5.1. 

Environmental 

The  most  effective  option  to  reduce  greenhouse  gas  emissions  is  the  phase-down  approach 
(D), saving 71 Mt CO2eq by 2030 or two-thirds of today's emissions. Bans in certain feasible 
sectors  (E)  would  deliver  emission  reductions  of  53  Mt  CO2eq,  i.e.  about  half  of  today's 
emissions, while introducing voluntary agreements (B) could achieve 22 Mt CO2eq by 2030 
(Table 1). The emission reduction of extending scope of containment (C) would be very small 
as  limited  to  some  transport  modes  only.  These  emission  savings  include  energy  efficiency 
impacts (i.e. overall savings from alternatives). The methodological basis for these findings is 
a  detailed  and  comprehensive  analysis  of  the  feasibility  of  introducing  safe  and  energy–
efficient alternatives at costs lower than 50 € per ton of CO 2eq abated in each of the 28 main 
different sub-sectors that use F-gases15. Ecotoxicological risks due to release of substances to 
the environment are considered to be low or negligible for all options. 

5.2. 

Economic 

The  F-gas  sector  comprises  a  number  of  different  market  players  who  may  be  affected  in 
different  ways  by  policy  changes:  Producers  of  F-gases,  manufacturers  of  equipment, 
electricity  companies,  equipment  service  companies,  importers  and  exporters,  users  of 
equipment,  the  retail  and  raw  material  sectors  (e.g.  metals  and  products).  A  number  of 
different economic impacts were analysed (Table 1), using an input/output model (EmIO-F) 
and a general equilibrium model (GEM-E3). Overall effects are small, with the input/output 
model  suggesting  a  small,  positive  impact  on  overall  output  (up  to  0.009%)  and  GEM-E3 
predicting a small decline (up to -0.006%). These effects are strongest in case of a phasedown 
(D), followed by bans (E). For the directly impacted sectors, equipment manufacturing may 
experience small gains, while the energy supply sector could encounter losses due to higher 
energy  efficiency  of  alternative  equipment.  Effects  on  the  chemical  sector  are  low.  The 
models  predict  small  losses  for  the  service  sector  due  to  the  smaller  number  of  F-gas 
equipment  requiring  leakage  checks.  These  potential  losses  should  however  be  fully 
compensated by new servicing needs for alternative equipment as well as to date unexploited 
opportunities in the application of the existing containment provisions. 

The phase-down (D) touches the highest number of application sectors and hence stimulates 
novel (green) technologies to the highest degree and leads to the highest use of alternatives. 
For the same reason total direct costs (investments and operations) to users of equipment will 
also  be  somewhat  higher  (followed  by  bans  (E)  and  voluntary  agreements  (B)).  The 
underlying assessment is based on a conservative approach by only considering replacement 
options which are currently available and calculations were performed on the basis of today's 
costs.  The  likely  decline  of  costs  involved  due  to  future  technological  development  and 
economies of scale was thus not taken into account.  

Indirect  effects  are  considered  to  be  marginal.  Due  to  the  low  costs,  competitiveness  is 
generally  not  adversely  affected,  in  particular  since  none  of  the  policy  options  requires  the 
replacement of existing equipment, so that direct investment costs would only occur after the 
end-of-life.  The  impacts  on  consumer  prices  will  be  small  for  all  options  and  negligible  in 

15 

Schwarz  et  al.  (2011)  "Preparatory  study  for  a  review  of  Regulation  (EC)  No  842/2006  on  certain 
fluorinated greenhouse gases." Öko-Recherche et al.  

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macroeconomic  terms  (-0.01  to  0.00%  for  Options  D  and  E,  based  on  GEM-E3).  As  for 
regional  impacts,  the  direct  impact  could  be  €1  highe r  per  inhabitant  in  Southern  European 
countries due to the more common use of air conditioning equipment. 

SMEs form a large part of the overall companies active in sectors using F-gases. In line with 
the small economic effects observed in the analysis, no excessive burdens for these companies 
are expected. A phase-down (D) provides more flexibility to industry players than introducing 
bans (E), which was frequently highlighted by stakeholders. Safeguards, such as de minimis 
clauses,  can  be  introduced  to  exempt  very  small  F-gas  market  players  from  reporting  and 
certain obligations.  

All  options  are  designed  in  a  way  that  domestic  producers  and  importers  of  appliances  will 
face  the  same  conditions  for  placing  products  on  the  EU  market.  Therefore  international 
competitiveness will not be affected. First mover-advantages for European companies at the 
international  level  are  likely,  in  particular  if  a  global  agreement  to  phase-out  F-gases  is 
reached.  A  phase-down  (D)  and  bans  (E)  would  create  a  substantial  market  for  low-GWP 
technologies and thus incentivise the development of such technologies also in exporting third 
countries.  Administrative  costs  can  be  kept  relatively  low  as  the  existing  reporting  scheme 
under  the  F-gas  Regulation  will  form  the  backbone  of  data  needs  for  implementing  future 
policy  options.  Only  independent  verification  would  add  to  the  costs,  which  is  the  case  in 
particular for a properly executed voluntary agreement (B) approach. 

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Table  1:  Summary  table  of  environmental,  economic  and  social  impacts  of  the  policy  options  by 
203016 

IMPACTS 

Option B 

Option C 

Option D 

Option E 

Voluntary 
agreements 

Enlarged Scope 

Phase-down 

Bans 

ENVIRONMENTAL 

Emission Reductions 

SUM [Mt CO2eq] 

Total 
[(M€/year] 

direct 

costs 

Administrative 
[M€/year] 

costs 

Direct  effects  on  sector 
output (% change) 

[ % of 2007, I/O model] 

- machinery/ equipment 

- services/ maintenance 
- chemicals 

- electricity 

22.2 

530 

10.7 

0.006 

0.38 

-0.09 

-0.19 

-0.19 

GDP  impacts  (%  change, 
GEM-E3 model) 

smaller than D 

Impacts Regions 

Impacts SMEs 

Internal market 

Competiveness, trade& 
investment 

Third countries 

Consumer price 

Innovation & research  

Negl. 

no significant 
effects 

none 

small 

Negl. 

Negl. 

facilitates new 
technologies 
to low degree  

SOCIAL 

Employment: 
2030 [No. of jobs] 

impact 

in 

Safety & health risks 

+600 

Negl. 

16 

Negl. = negligible 

EN 

70.7 

1500 

0.2 

(+ 1.9 one-off) 

53.3 

1330 

1.2 

0.009 

0.003 

0.52 

-0.38 

0.17 

-0.59 

0.23 

-0.37 

0.03 

-0.26 

-0.006 

-0.003 

small effects on 
EU South 

smaller than D 

no significant 
effects 

no significant 
effects 

none 

small 

positive for 
alternatives 

incentivises 
alternatives 
globally 

None 

small 

positive for 
alternatives 

incentivises 
alternatives 
globally 

Negl. 

Negl. 

facilitates new 
technologies 
and products 

facilitates new 
technologies 
and products 

-16000 to  
+7000 

Negl. 

-12,000 to 
+4000 

Negl. 

1.4 

66 

0 

Negl. 

Negl. 

Negl. 

Negl. 

Negl. 

Negl. 

Negl. 

Negl. 

none 

Negl. 

Negl. 

Negl. 

Negl. 

Negl. 

Negl. 

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5.3. 

Social 

Effects on employment are small. For a phase-down (D) modelled effects range between an 
increase  of  around  7000  to  a  decrease  of  1600  to  16000  jobs.  As  the  effects  of  the  other 
options are lower the maximum expected effect on employment is in the order of +0.003% to 
-0.007% (Option D). Job creation effects would occur in the machinery and equipment sector 
as well as sectors providing input materials (e.g. basic metals, metal products). Job losses are 
predicted  in  the  energy  supply-sector  and  the  service  sector,  but  the  latter  effects  are  likely 
balanced out by other effects. 

Health  and  occupational  risks  for  alternatives  are  not  expected  to  increase  as  long  as  safety 
standards and procedures are followed. The feasibility analysis of alternatives was based on 
the precondition that only proven, safe and energy-efficient technologies should be deployed. 
Proposed  minimum  training  requirements  for  certified  personnel  covering  also  alternative 
substances further minimise safety risks.  

6. 

COMPARISON OF OPTIONS 

The  Impact  Assessment  concludes  that  a  phase-down  (D)  would  give  the  highest  additional 
environmental  benefit,  stimulate  innovation  to  the  highest  degree  and  would  come  at  a  low 
cost to the economy and society as a whole. It results in a reduction of around 60% in 2030 
compared to 2005 in line with the EU Low Carbon Economy Roadmap and is thus the only 
option sufficiently effective. This option is also seen as more flexible by many stakeholders, 
in  contrast  to  bans  (E).  Voluntary  agreements  (B)  and  even  more  extending  scope  of 
containment and recovery (C) are far from yielding sufficient emission savings in view of the 
overall objective. Social and economic impacts are considered marginal for all options.  

Overall, the highest effectiveness can be obtained by complementing the phase-down (option 
D) with the extension of containment provisions to some transport modes (Option C), as well 
as placing on the market bans in a few limited areas (gases not targeted by the phase-down 
and destruction of by-products, which are sub-options included under Option E). Measures to 
ensure  that  quantities  imported  in  pre-charged  equipment  are  counted  under  the  cap  are 
indispensable  for  the  environmental  integrity  of  the  phase-down  mechanism  and  a  level 
playing field in the market.  

Some stakeholders17 also recommend combining a phase-down with certain "supportive" bans 
e.g. in the field of refrigeration, to give more certainty of F-gas availability to those sectors 
where  a  replacement  is  more  difficult.  Such  bans  would,  in  principle,  not  affect  the 
environmental, economic or social impacts, as the "phasedown" would cover these sectors in 
any  case.  Consequently,  Option  D  together  with  Option  C,  as  well  as  complementary  and 
supportive bans, would achieve an emission reduction of ca. 72 Mt CO2eq (adding ca. 1 Mt 
CO2eq emission reductions to option D).  

17 

E.g the Network of Environmental Protection Agencies 

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