HPMP PREPARATION EXCOM POLICY AND ELIGIBILITY ISSUES AND INFORMATION REQUIREMENTS

1  Consistent with HPMP Guidelines (ExCom Decision 54/39 and Document UNEP/OzL.Pro/ExCom/54/59, Annex-XIX)  Accurate data needed at enterprise-level: - Date of establishment of HCFC-based capacity -Baseline equipment details -Product details including production volumes -HCFC consumption details -Previous MLF assistance -Exports to non-A5 countries -Non-A5 ownership -Alternative technology selected

2 INFORMATION REQUIREMENTS (CONT’D)  Detailed project rationale, description and justification for the proposed conversion (why it is necessary for meeting the country’s compliance targets for 2013 and 2015)  Detailed calculation of incremental capital and operating costs and justification for each line item  Determining eligible costs and funding based on ExCom guidelines For large countries, the above work needs at least one month after all the accurate baseline data is available.

3 ELIGIBILITY  Only capacity established prior to 21 September 2007 is eligible for funding  Enterprise should be in operation for at least three preceding years  Funding is available only for costs in proportion to the A5 ownership.  Funding deducted for exports to non-A5 countries proportionately  Funding is for agreed, eligible and incremental costs, not for all costs

4 ELIGIBILITY (CONT’D)  “Incremental Costs” means costs directly related to phase-out of HCFCs  Enterprise must undertake to bear costs over and above the agreed funding  Total funding is limited by cost-effectiveness thresholds: o Rigid Foams – up to US$ 7.83/kg-ODS o Integral Skin Foams – up to US$ 16.86/kg-ODS o Refrigeration – up to US$ 15.21/kg-ODS o Air Conditioning – N/A

5 ELIGIBILITY (CONT’D)  Incremental operating costs (recurring costs of products before and after conversion), are limited to: o PU Foams – up to US$ 1.60/kg-ODS o Refrigeration – up to US$ 6.30/kg-ODS o Air Conditioning – up to US$ 6.30/kg-ODS  Cost-effectiveness thresholds for overall funding can be increased by 25% if climate-friendly (low-GWP) options are chosen  Funding is provided for permanent HCFC phase- out/reductions (HCFC phase-out has to be permanent at enterprise level – cannot come back again!)

6 THANK YOU! Comments, suggestions and questions welcome