01 Nov 2010

In the context of our HFC-23 campaign, CDM Watch together with EIA, NOÉ 21 and German NGO Forum on Environment and Development has sent open letters to several companies regarding their involvement in HFC-23 projects.

Download company letters below:

• Open letter to Bank of America Merrill Lynch
• Open letter to Barclays Capital
• Open letter to Business Europe
• Open letter to Crédit Agricole CIB
• Open letter to Duetsche Bank
• Open letter to EDF
• Open letter to ENEL and ENDESA
• Open letter to EON
• Open letter to ESKOM
• Open letter to Eurelectric
• Open letter to JP Morgan
• Open letter to RWE

Sample letter to BusinessEurope

1 November 2010

OPEN LETTER: Civil society concerns about HFC-23 projects under the CDM

Dear Mr de Buck,,

As you are no doubt aware, HFC-23 projects under the CDM have come under increasing focus, in the media and at UN level, over their lack of environmental integrity.

An analysis of data of all registered HFC-23 projects clearly shows that some manufacturers are gaming the CDM system and that many of the carbon credits generated by HFC-23 projects do not represent real emission reductions.

Our key concerns are as follows: the current system effectively rewards those projects which produce the highest levels of HFC-23 by failing to punish the use of suboptimal waste gas production ratios. This has prevented the application of more efficient technology, resulting in the generation of millions of phony credits. The prospect of earning vast revenues from HFC-23 destruction also incentivizes and subsidizes the production of HCFC-22, of which HFC-23 is a by-product, and which is a potent ozone depleting substance and greenhouse gas in its own right.

As a result of these serious concerns, the CDM Executive Board has launched an official investigation into this matter, and has suspended the issuance of CERs for several HFC-23 projects. In addition, the European Commission is about to finalise a proposal to introduce quality restrictions on the use of credits from industrial gas projects in the post-2012 EU ETS.

On behalf of civil society and of the organisations listed above, we would like your feedback on the following:

• Does BusinessEurope share our concerns regarding multiple problems with the HFC-23 CDM methodology? In particular, are you aware of the allegations of fraud regarding a large number of these projects?
• Do you support a change in the CDM methodology to eliminate the perverse incentives inherent in the current system?
• Do you support calls for this type of CDM project to be excluded from current and future use within the EU ETS?
• Given that these credits have the potential to seriously undermine the EU ETS, do you support our call for a strict ban on banking these credits into Phase 3 of the EU ETS, regardless of the project’s approved crediting period?

BusinessEurope recently received the dubious honour of being nominated for the Worst EU Lobbying Award 2010 for its “aggressive lobbying to block effective climate action in the EU while claiming to support action to protect the climate”. We hope that you and your members will prove your critics wrong by making a genuine stand in favour of the climate.

We look forward to hearing from you. Please note that this is an open letter which will be shared with the media and other interested parties. We also plan to publish the contents of your response on our respective websites.

Yours sincerely,

the signatories