Polyurethane foam manufacturers in developing nations can receive financial reward for switching to blowing agents that do not contribute to climate change.
By deciding to use agents such as pentane, rather than climate-warming gases like hydrofluorocarbons in new manufacturing facilities, PU foam-blowing operations could earn as much as an additional $1.1 million a year.
The money is made available through the Kyoto Protocol, the international climate change agreement that allows the trading of greenhouse gas emission reductions, or ``carbon credits.''
The protocol creates demand by putting a cap on greenhouse gas emissions from 2008-12 in many industrialized countries, including European Union members and Japan, but not the U.S. The United States did not ratify the agreement. These industrialized countries can meet their caps by reducing domestic emissions or by offsetting - buying emission reductions created elsewhere.
The United Nations approved a methodology for a new type of project that would allow PU processors to earn carbon credits. Although carbon dioxide is the main greenhouse gas, the protocol counts others such as methane and nitrous oxide that also have a strong global warming effect. HFC blowing agents are particularly potent greenhouse gases - U.N. scientists estimate one metric ton (about 2,200 pounds) of HFC-134a has the same warming effect as 1,300 metric tons of carbon dioxide.
The methodology allows companies to claim credits for switching from HFC-134a, HFC-152a, HFC-365mfc and HFC-245fa, among others, to less damaging alternatives, like pentane. However, credit will be given only if the insulative characteristics of the product remain the same after the switch and the PU foam is sold in domestic markets.
The emission reduction is calculated over the manufacturing and usage of the product, but not its disposal, and companies can claim savings of no more than the equivalent of 60,000 metric tons of carbon dioxide a year.
Projects need the approval of a designated national authority and are verified by independent third parties to ensure the emission reductions are real, and the projects would not have otherwise occurred without the revenue that comes from selling the carbon credits.
Developing countries do not face caps, but under the Clean Development Mechanism plan established by the protocol, they can supply the carbon market with credits. Wind farms and industrial energy efficiency programs are among the types of projects issued a tradable credit for each metric ton of carbon dioxide they save from entering the atmosphere.
Since initiating the program, participating countries have prevented 63 million metric tons of carbon dioxide emissions from entering the atmosphere, according to the United Nations, which administers the system. Each credit is worth about $19.
Planners theorize when investment flows from rich, industrialized countries toward poorer, less developed countries - such as China, India, South Africa and the Philippines and others that have ratified the protocol - it will help put them on a path of low-carbon development. With the availability of such carbon capital, companies can make investments in clean technologies that would not otherwise be financially viable.