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Bad Romance in Ulaan Baatar
Nirmal Ghosh, ST Blogs, 17th July 2012

On the floor of the factory shed in a ramshackle potholed industrial zone on the outskirts of Mongolia’s capital, are strewn nine huge cylinders of hydrochlorofluorocarbons (HCFC), an industrial gas used in this case to make insulation pads for the walls of buildings.

The hundreds of foam pads are stacked up against a wall. After a couple of years of doldrums, Bilguun Trading can’t turn them out fast enough now. Ulaan Baatar is seeing a massive building boom on the back of Mongolia’s staggering 17.3 per cent economic growth last year driven mainly by controversial extraction of natural resources.

HCFC cylinders and green building insulation pads at a factory in Mongolia - building boom adds to global warming fears

The international media has lately been full of stories on the boom, and the transformation of the capital. There are so many big modern buildings coming up now that you can barely see the storied mountains outside the city or the big skies that the country is famous for. The statue of Lenin still standing outside the Soviet-era Ulaan Baatar hotel is being dwarfed by gleaming new high rises.

But none of the articles I have seen mention the sting in the tail which remains hidden from the public eye or lost in the clear blue sky.

Downtown Ulaan Baatar - Burst of new life, but a sting in the tail

The problem is, the HCFCs while relatively benign to the critical ozone layer, are significant drivers of global warming. The Mongolian government wants Mr Bataa to stop using HCFCs to comply with its international obligations.

HCFCs are only one of a two-pronged problem closely linked to economic growth and urbanisation. The other is another family of gases called hydrochlorofluorocarbon (HFC), used in air conditioning – an industry that is growing by 20 per cent per annum in Asia.

From Mongolia to Myanmar, and across Asia, new construction booms and a rising affluent middle class are fuelling a dangerous rise in the use of these gases.

At current rates of use and growth, HCFCs and HFCs used in building insulation, air conditioning and refrigeration, will drive 27 per cent of global warming by 2050. The biggest drivers are of course the giant economies of China and India. But no less critical are new sources coming on line as thus far low-impact cities like Ulaan Baatar and Yangon, enter the scene with their frantic building sprees fuelled by foreign investor interest.

In his first floor office, director of Bilguun Trading Mr Bataa Ch – who collects rare Mongolian-Tibetan Buddhist tangkhas in his spare time - spoke occasionally bitterly, with visiting government and United Nations (UN) experts about the difficulties of converting his production system.

Factory owner Mr Bataa Ch (right) with his building insulation pads, with Mongolia's ozone officer and former environment minister Adiyasuren Tsokhio: building boom adds to global warming fears.

Mr Bataa has two years to switch from HCFCs to another technology. He will get US$ 65,000 (S$83,000) to help him, from the Montreal Protocol. But that is not nearly enough, he says. Setting up a new production system could cost him a million Dollars.

Under the 1987 Montreal Protocol, considered the world’s most successful environmental agreement, the earlier family of gases used in refrigerators and air conditioners and propellants and foam from car seats to household upholstery – and which decimated the ozone layer - was phased out and replaced with HCFCs and HFCs.

But while that helped the ozone hole discovered in the 1970s to stabilise and even edge towards recovery, these gases pack a greenhouse gas punch far higher than carbon dioxide, the chief villain of global warming. HFCs for instance, have a greenhouse gas effect 2,100 times greater than carbon dioxide.

The Multilateral Fund under the Montreal Protocol, helps finance conversion to gases less harmful to ozone, and less powerful as agents of global warming. But conversion is difficult even without resistance from entrenched industrial interests.

Less harmful substitutes like hydrocarbons have been developed, but red tape and restrictions – because some are flammable - make them difficult to convert to. There are also industrial giants that produce HFCs – and resisting the use of natural refrigerants like hydrocarbons, experts say.

'If there are difficulties here, can you imagine what a problem it is in other countries like China and India where there are scores of factories like this,' the visiting United Nations Environment Programme (UNEP) expert Mr Atul Bagai said as the team left Bilguun Trading.

The 1987 Montreal Protocol deals with gases that destroy the ozone layer. The Kyoto Protocol – the subject of tortuous and by and large ineffective climate change talks from Copenhagen in 2009 to Durban last year – deals with a basket of 6 gases but only with total emissions, of which HFCs are still just a small portion.

HCFCs are under the Montreal Protocol. HFCs used in the booming air conditioner and refrigeration industries, are not. Many experts have been clamouring for HFCs to also be placed under the successful Protocol, which regulates their production and funds industry to convert to less harmful substitutes. But as of now, the gases remain under the failing Kyoto Protocol.

'The Montreal Protocol can no longer work in isolation,' warned Mr Bagai, Bangkok-based ozone programme coordinator for 38 Asian countries.

'Leapfrogging to environmentally friendly refrigerants has to be part of a much broader debate on food security, urbanisation, safe habitat, energy security and climate change.'