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A handful of Chinese and Indian chemicals companies seemingly have the world over a barrel – or rather a large number of barrels of a super-greenhouse gas called HFC-23, which is 14,800 times more potent than carbon dioxide.
This week, apparently following Chinese threats to vent stockpiles of HFC-23 into the atmosphere, a UN panel issued two million valuable carbon credits to a company called Juhua. It has a factory in Hangzhou, Zhejiang province, where the gas can be destroyed.
Nobody needs HFC-23. It is a waste by-product of the manufacture of a refrigerant called HCFC-22, used mostly in developing nations. To curb the release of HFC-23 into the atmosphere, the signatories to the Kyoto protocol agreed to pay carbon credits to refrigerant manufacturers that agree to capture and destroy it. The manufacturers can then sell the credits to western companies that want to offset their obligations to cut emissions of other greenhouse gases, under a Kyoto scheme known as the Clean Development Mechanism (CDM).
The offer only applies to HCFC-22 plants that were built before 2000. Even so it has proved highly lucrative. By some estimates, the value of the carbon credits is up to 100 times the cost of incinerating HFC-23. The resulting income of Chinese companies alone is estimated to reach $1.6 billion by 2012. As a result, the "waste gas" HFC-23 has become much more profitable to refrigerant factories than HCFC-22 itself. Watchdog groups like the London-based Environmental Investigation Agency (EIA) say the compensation system ends up providing a strong incentive to overproduce HCFC-22, using methods that maximise the output of HFC-23.
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http://www.newscientist.com/article/dn19878-carbon-trading-tempts-firms-to-make-greenhouse-gas.html?DCMP=OTC-rss&nsref=online-news
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