Loophole opens up black market in CFCs . . .
By DEBORA MacKENZIE in BRUSSELS Companies in Europe could import thousands of tonnes of banned or restricted ozone-destroying compounds this year because of a loophole in the Montreal Protocol, the international treaty that protects the ozone layer. Chemicals firms warn that a black market is growing in these compounds which could delay Europe’s switch to less damaging alternatives. Halons, used as fire extinguishers, have been banned since 1 January. CFCs, the main ozone-destroying chemicals, are to be banned in the European Union at the beginning of 1995. This year, according to Europe’s phase-out schedule, fridge makers, foam blowers and other users of CFCs are supposed to consume only 15 per cent of the amounts they used in 1986. But last month, the European Commission announced that it will allow companies to import 2000 tonnes of halons, with an ozone-destroying potential equal to 20 000 tonnes of CFCs. It will also permit 10 000 tonnes of CFCs into the EU for recycling, and 16 000 tonnes as feed-stocks – used to produce other chemicals. This will increase the amount of CFCs available in Europe from 15 per cent to 24 per cent of the amount used in 1986. The Commission says the Montreal Protocol allows ‘unlimited’ production of CFCs as feedstocks, and puts no limit on trade in used chemicals because recycling is better for the environment than prod-ucing new chemicals. But European chemicals companies, including France’s Elf-Atochem, Hoechst and the Chemical Industry Federation in Germany and Belgium’s Solvay, protested last week that there are few controls on whether the imports are really used as feedstocks or recycled. These companies have invested heavily in alternatives to CFCs and halons, and say sales of their replacements are being limited by a black market in the old ones. David Clow of Elf-Atochem says there is only one major user of CFCs as a chemical feedstock in Europe. Zeneca, the former biotechnology arm of ICI, modifies 1500 tonnes of CFCs a year to make a pesticide. But this year the Commission plans to award import quotas for 16 000 tonnes of CFCs to be used as feedstocks. It has already handed out quotas for 9544 tonnes, and some of those with quotas are not chemicals manufacturers. They include Efisol, a French company that makes expanded polyurethane foam, and a company in Belgium, International Gas and Services, which specialises in repackaging CFCs into small cylinders for sale to contractors that install refrigerators. Imports of used CFCs into the European Union for recycling or destruction were banned until 1992, when Sweden insisted on sending surplus CFCs back to the manufacturer, ICI, for disposal. Since then, the Commission has allowed used CFCs to be imported for this purpose. The Commission has awarded import quotas for 5630 of the 10 000 tonnes it will allow into the EU for recycling this year. Some quotas have been given, as intended, to the CFC producers such as ICI and Du Pont. But they also went to nonproducers such as National Refrigerant of America, a British subsidiary of an American company that repackages CFCs in cylinders. ‘Repackaging is not what was supposed to be meant by feedstocks or recycling,’ says Clow. Clow, and other industrialists who do not want to be named, say there is little to prevent new CFCs produced in Russia, for example, from being ‘coloured with a bit of bitumen to make them look used’. Then, they can be imported into the EU as recycled CFCs. Clow and others say several thousand tonnes were imported from Russia this way last year. ‘There is no CFC recycling industry in Russia or developing countries,’ says Clow, so imports from these countries are probably new CFCs, although this is extremely difficult to prove. Once in Europe, there are few controls on what is done with imported CFCs. And there is no shortage of buyers. Officials at the Commission admit a ‘crisis’ is looming among CFC users in Europe, especially fridge manufacturers. They are facing the imminent disappearance of CFCs, but so far few have switched to the more expensive replacements. Illicit sales would be profitable. ‘A tonne of Halon 1301 bought for $2000 per tonne outside the EU can be sold here for $7000 per tonne,’ says Clow. Other industry sources confirm that prices for CFCs in Europe have increased as supplies have fallen. Next month, as the Commission’s phase-out schedule begins to bite, prices are expected to climb steeply. In Russia and India – which has a huge spare capacity for making CFCs – prices are still stable because bans on the chemicals are not yet in force. Mike Harris of ICI says ‘we need to ensure this possible loophole is closed.’ ICI and other makers of alternative compounds are pressing the Commission not to issue import licences to the companies that have been given quotas. Apart from that, says Harris,