Conclusions and recommendations
Progress on reducing F-gases
1.We welcome the fact that the EU overachieved the 2015 and 2016 HFC Quota targets and that there is evidence of price rises for higher GWP refrigerants as their availability is restricted. However, the targets were fairly unambitious and it remains to be seen whether UK companies, especially SMEs, are prepared for the big cuts required in 2018 and 2021. There is a danger this year that some businesses will find that they will not be able to access the refrigerants that they need and may be tempted to acquire them illegally. This would pose a challenge for the Environment Agency in monitoring and enforcing compliance. We are concerned that the Environment Agency may lack the resources it will need to police and enforce F-gas regulations, especially when it is also preparing to take on new responsibilities as the UK leaves the EU. If the UK can meet the steeper cuts in 2018 and 2021, the Government should find ways to cut F-gas emissions even further. (Paragraph 19)
2.We are concerned that, despite the EU exceeding the 2015 and 2016 HFC Quota targets, the UK is in danger of moving away from the least-cost pathway that the Committee on Climate Change mapped out as part of the UK’s overall efforts to reduce GHGs. While the market-based approach adopted by the EU is making progress, the Government should be prepared to consider other measures to help get the UK back on track to hit the Fourth and Fifth Carbon Budgets. As discussed in the following sections we believe that the Government can take further action to make more progress in reducing F-gases and particularly HFCs. (Paragraph 22)
3.We recommend that low GWP inhalers should be promoted within the NHS unless there are specific medical reasons for not doing so. Promotion should include raising awareness of low GWP inhalers and training amongst NICE, the medical community and patients. The NHS should set a target that by 2022 at least 50% of prescribed inhalers are low GWP. It should publish annual progress reports. We were disappointed to find that so few MDIs are disposed of responsibly. We therefore recommend that the Government should work with medical professionals, pharmacists, the pharmaceutical industry and patients to significantly improve the recycling of MDIs; this makes both environmental and economic sense. The Government should ensure that by 2020, at least 50% of MDIs are recycled. The Government should publish annual data showing progress in reaching and exceeding this target. It should also consider medical waste, such as MDIs, in its waste strategy. (Paragraph 27)
4.The Government should ensure that heat pumps use low GWP refrigerants. The Government should reform the Renewable Heat Incentive schemes so that they encourage the deployment of heat pumps that use low GWP refrigerants, and that by 2020 all publicly-funded heat pump projects use low GWP refrigerants. It should publish annual data indicating which gases are being used in heat pumps so that Parliament and the Committee on Climate Change can track performance in this area. (Paragraph 29)
5.Government departments should lead from the front on reducing their environmental impact. The Greening Commitments set targets and measures for GHG emission reductions: We recommend that they should be amended include targets for departments to reduce their consumption of products containing high GWP F-gases. (Paragraph 31)
Enforcement of F-gas Regulations and the MAC Directive
6.We were disturbed to hear from industry and others that they suspect large levels of non-compliance. We are concerned that the Environment Agency does not have the adequate resources to tackle this problem. The low number of investigations and the single prosecution for a self-reported breach since the beginning of 2015, when the current F-gas Regulation came into effect, do not inspire confidence. This is especially concerning with deeper cuts in HFCs due in 2018 and 2021 and if the Environment Agency is to take on additional responsibilities as result of leaving the EU’s HFC Quota system in addition to the range of EU exit-related work it is already undertaking DEFRA and the Environment Agency should publish plans for monitoring non-compliance, especially on social media sites, and how they will ensure with HMRC that there are no weaknesses in the F-gas regime now and after the UK leaves the EU. Online sellers have the tools to end environmental criminality on their platforms. They should use them. (Paragraph 34)
7.The introduction of civil penalties may increase the number of prosecutions and deter non-compliance. However, without a properly resourced regime, prosecutions will be difficult. We question the Government’s decision not to retain more criminal sanctions, which would have added to the deterrence effect for non-compliance, especially for the worst offences. We recommend that the Government reviews the effectiveness of the F-gas compliance regime annually, indicating the actions it is taking, the resource it is assigning to such activities, the number of investigations carried out and the number of successful prosecutions achieved. (Paragraph 36)
8.It is essential that anybody who handles top-up refrigerants for car air conditioning units should be trained, certificated and monitored. Otherwise there is a real danger that high GWP HFCs will be discharged into the atmosphere. This appears in part a result of the wording of the Mobile Air Conditioning (MAC) Directive. The Government should set out how it will correct this deficiency and ensure that only qualified mechanics handle refrigerants for car air conditioning units. (Paragraph 38)
9.The fact that thousands of qualified engineers are not trained in relation to low GWP refrigerants is inhibiting the switch to low GWP alternatives. The Government should consult with industry and bring forward proposals to ensure that all those who handle refrigerants have up-to-date training. (Paragraph 40)
10.We are pleased that technical aerosols using high GWP refrigerants will now be banned. However, we do not believe the Environment Agency has the resources to ensure compliance in this area while it is preparing to take on additional responsibilities as the UK leaves the EU. The Government should provide more detail in response to this report, on how it will police these banned products and how this will be resourced. (Paragraph 42)
The Impact of leaving the EU on the UK’s F-gas Regime
11.There does not appear to be any appetite for the UK to leave the EU’s F-gas regulatory regime. The Government have said that they are planning for several scenarios, including the UK establishing its own F-gas system based on the EU’s regime. We welcome the Government’s commitment that it has no intention of lowering current emission targets. However, we do not believe that it would be a good deal for the UK if it were to replicate the EU system without a say on the rules that govern it, whilst businesses would be subject to the additional costs that two regulatory systems would impose. Businesses need certainty about whether the UK will remain in the EU system during the transitional period. We therefore recommend that the UK should seek to remain part of the EU’s quota system. This will not prevent the UK Government from being more ambitious in its efforts to reduce F-gas emissions through the measures outlined above. If, however, the Government decides to leave the EU system, it must set out concrete proposals showing how it will be able to achieve more progress on F-gases. (Paragraph 48)
12.Setting up a UK-based system may represent poor value for money for the UK taxpayer. In its response to this report, the Government should set out its assessment of how much funding would be required to run and police a UK-based system. The Government should publish a fully costed proposal for a UK scheme, including its assessment of the expected additional costs to taxpayers, businesses and the NHS of setting up a UK-based own system. We note that the track record of government IT projects staying within budget is not good, so we have little confidence that the £250K allocated to run a UK system will be sufficient. (Paragraph 50)
13.It is essential that there is independent oversight of Government policy to ensure the UK meets its obligations, for instance hitting HFC reduction targets agreed under the EU’s quota and under the Kigali Amendment to the Montreal Protocol. We have separately called for evidence on the Government’s proposals for the structures and principles which will underpin the governance of environmental policy across a range of areas, including F-gases. We welcome the Environment Secretary’s promised consultation on a new statutory body to enforce environmental law after exit day but we are concerned by its delay. We reiterate our previous recommendation for an Environmental Protection Act before the UK leaves the EU to ensure that EU environmental law does not end up as ‘zombie legislation’, whereby EU legislation transposed into UK law is not monitored, updated or enforced because it relies on EU policies and institutions. The Government’s approach to the EU (Withdrawal) Bill should recognise this risk. (Paragraph 53)
14.We welcome the Secretary of State’s remarks to our Committee and elsewhere that he will not allow trade talks to dilute the UK’s environmental standards. Reducing high GWP HFCs are part of the commitments we have made under the current EU targets (which the Government has said it will honour after we leave the EU) the Kigali Amendment to the Montreal Protocol and forms part of the package under the Kyoto Protocol and Paris Agreement to reduce our GHG emissions. We will hold the Government to their commitments. (Paragraph 56)
15.Though we recommend that the UK should remain within the EU’s HFC Quota system, if the Government decides to leave the EU’s HFC Quota system it must set out how UK businesses will manage their HFC quotas and not be put at a commercial disadvantage in relation to their European counterparts. (Paragraph 58)
16.The Government and the devolved administrations need to be pro-active in developing UK systems of future environmental enforcement as the UK leaves the EU. The ongoing uncertainty, along with the challenges that withdrawal from the EU Quota system pose, creates uncertainty for industry. We agree with the Minister that it would be best to have an overarching body to set and monitor UK-wide F-gas targets, based on a consensual agreement between the devolved legislatures and Westminster. The Government should publish in its response to this report a timetable for negotiating with the devolved Administrations on how F-gas emissions will be managed after the UK leaves the EU. (Paragraph 60)
17.We are concerned that, if UK and EU policies diverge in the future, Northern Ireland could become a back door for appliances containing F-gases which have been restricted or banned on only one side of the border. (Paragraph 62)
18.Whilst it seems unlikely that the UK will drop out of the Montreal Protocol and similar international multilateral mixed environmental agreements when it leaves the EU, there is nevertheless uncertainty as to what will happen after exit day. Some complex international agreements, such as the Kyoto Protocol, will a present significant challenge. The Government should undertake and publish legal analysis on the status of the UK’s international environmental treaties after it leaves the EU within two months of this Report being published. The Government should also give serious consideration to issuing a joint statement with the EU to provide clarity that the UK will fully assume its obligations under these treaties. (Paragraph 64)
Published: 25 April 2018