United Nations Development Programme Country: Belarus 1 PROJECT DOCUMENT

Project Title: “Initial Implementation of Accelerated HCFC Phase Out in the CEIT Region”

UNDAF Outcome: 3. Environmental sustainability is increased

Expected CPD Outcome: 3.2. Sustainable use of the country’s natural resources promoted

Expected CPD Output: 3.2.2. Sound management of chemicals (SMC) promoted

Executing Entity: Ministry of Natural Resources and Environmental Protection of the Republic of Belarus (MNREP)

Implementing Entity: UNDP Brief Description The current FSP is a response to the obligations incurred by Belarus under the phase out schedule for HCFCs of the Montreal Protocol. It is a timely capacity building effort (with investment elements for the servicing sector) designed to improve regulatory measures to help address the accelerated HCFC phase-out in the medium and longer term, and to strengthen the country’s preparedness for the complete phase-out of HCFCs from current use. The institutions in Belarus that were supported by the GEF for the past CFC-phase out efforts have been re-engaged in the proposal as much as possible. In the following document the two primary project components listed in the PIF are described along with their sub-components, namely: Component 1 “Regional information exchange and networking” addresses the barriers associated with incomplete knowledge and awareness and corresponds to the PIF Component 1; Outcomes 1(a-d). Component 2 “National capacity building and technical assistance” supports the adoption of the fully completed HCFC phase-out strategy (with selected legislative options to control HCFC import/use), capacity building and supply of analytical and servicing equipment/tools for the Environmental Inspectorate and Customs Departments and refrigeration technicians, technological conversions for solvents and rigid foams, modernization of HCFC re-use scheme in the country and demonstration of alternative technologies in refrigeration equipment and A/C sectors, pilot small-scale ODS destruction, the current absence of effective regulatory instruments and need to support ongoing institutional development. It is aligned with Outcome 2 (a) - Belarus. Programme Period: 2011-2015 Total allocated resources: US$ 9,095,000 Atlas Award ID: 00070086 Project ID: 00084272 o GEF^ US$ 2,200,000 PIMS #: 4309 Parallel financing: o Government: US$ 1,050,000 Start date: April 2013 o Other: US$ 5,845,000 End date: June 2015 Management Arrangements: NEX (reg DIM)

Ministry of Natural Resources and Environmental Protection of the Republic of Belarus

Vladimir G. Tsalko Minister Signature Date

UNDP Sanaka Samarasinha UNDP Resident Representative in Belarus Signature Date

1 For UNDP supported GEF funded projects as this includes GEF-specific requirements 2 List of Abbreviations and Acronyms

A/C Air Conditioner CEIT Countries with Economies in Transition CFC Chlorofluorocarbons CIS Commonwealth of Independent States EU European Union ExCom Executive Committee of the Multilateral Fund for the Implementation of the Montreal Protocol GEF Global Environmental Facility GDP Gross Domestic Product GWP Global Warming Potential HCFC Hydrochlorofluorocarbons HFC Hydrofluorocarbons HFO Hydrofluoroolefins HPMP HCFC Phase Out Management Plan DTIE Division of Trade Industry and Environment (UNEP) kw Kilowatt IA Implementing Agency iPIC Informal Prior Informed Consent MAC Mobile Air Conditioning MLF Multilateral Fund for the Implementation of the Montreal Protocol MP Montreal Protocol MNREP Ministry of Natural Resources and Environmental Protection of Belarus MSP Medium Size Project MT Metric Tonne NOU National Ozone Unit ODP Ozone Depleting Potential ODS Ozone Depleting Substance PU Polyurethane QPS Quarantine Pre-Shipment RAC Refrigeration and Air Conditioning RMP Refrigerant Management Plan TA Technical Assistance TEAP Technology and Economic Assessment Panel TEWI Total Equivalent Warming Impact UNEP United Nations Environmental Programme UNDP United Nations Development Programme

3 4 TABLE OF CONTENTS

1 SITUATION ANALYSIS...... 7 1.1 GLOBAL CONTEXT AND SIGNIFICANCE ...... 7 1.1.1 ISSUE BACKGROUND AND BASELINE 1.1.2 GLOBAL AND ENVIRONMENTAL BENEFITS 1.1.3 LINKAGES WITH CP, UNDAF AND CCA...... 8 1.2 KEY BARRIERS ...... 1316 1.3 STAKEHOLDER ANALYSIS ...... 1518 1.4 BASELINE ANALYSIS ...... 21

2 STRATEGY ...... 22 2.1 PROJECT RATIONALE AND POLICY CONFORMITY ...... 22

3 PROJECT GOAL, OBJECTIVES, OUTCOMES AND OUTPUTS/ACTIVITIES...... 24 3.1 COMPONENT 1 - REGIONAL ACCELERATED PHASE-OUT CAPACITY BUILDING (GEF FINANCING US$ 295,001 (INCLUSIVE OF REGIONAL PMC – US$ 45,000); NATIONAL CO-FINANCING US$ 450,000) ...... 25 3.1.1 OUTCOME 1A - LEGISLATIVE AND POLICY OPTIONS FOR HCFC PHASE-OUT AND CONTROL (US$ 55,556)

3.1.2 OUTCOME 1B - CAPACITY BUILDING FOR ENFORCEMENT OF HCFC CONTROL MEASURES BY CUSTOMS AND ENVIRONMENTAL25 /TECHNICAL INSPECTION AUTHORITIES (US$ US$ 55,556) 3.1.3 OUTCOME 1C - CAPACITY BUILDING FOR THE REFRIGERATION SECTOR, INCORPORATION OF ENERGY- EFFICIENCY AND GHG REDUCTION ELEMENTS (US$ 111,111) ...... 25 3.1.4 OUTCOME 1D - SUPPORT FOR THE DEVELOPMENT OF REGIONAL INSTITUTIONS, CAPACITY, AND COOPERATION (US$ 27,778) ...... 25 3.1.5 OVERVIEW COMPONENT 1 - REGIONAL ACCELERATED PHASE-OUT CAPACITY BUILDING 3.2 COMPONENT 2A - HPMP,...... NATIONAL...... LEVEL CAPACITY...... STRENGTHENING...... AND HCFC...... PHASE-OUT.....25 INVESTMENT (GEF FINANCE – US$ 1,965,000; NATIONAL CO-FINANCE – US$ 6,115,000) ...... 2628 3.2.1 OUTPUT 2A.1: IMPLEMENTATION OF THE APPROVED FORMAL HCFC PHASE-OUT STRATEGY AND ACTION PLAN 3.2.2 OUTPUT 2A.2: TRAINED WORKING LEVEL CUSTOMS AND ENFORCEMENT OFFICIALS, AND REFRIGERATION TECHNICIANS28 (USING RESOURCES (TRAINERS AND TRAINING MATERIALS) FROM COMPONENT 1 WITH RESPECT TO LEGISLATION, REGULATIONS, CUSTOMS CONTROLS, REFRIGERATION SERVICING TECHNIQUES, AND GENERAL BEST PRACTICES) 3.2.2.1 Customs and environmental control officials training and equipment support to enhance Customs control capability...... 30 3.2.2.2 Refrigeration technicians training and equipment support to enhance refrigeration-servicing practices 3.2.3 OUTPUT 2A...... 3 – TARGETED...... PHASE-OUT INVESTMENT...... AND...... PILOT PROJECTS...... 30 3.2.3.1 PU Foam conversion project: The phase-out the use of HCFC-141b at MAZ Kupava 33 3.2.3.2 Solvents conversion project: Elimination of the use HCFC-141b at Atlant...... (David-Gorodok...... 34 Electromechanical Plant) as a solvent in assembling/manufacturing processes ...... 35 3.2.3.3 Demonstration of natural cooling technologies for milk coolers and refrigerated equipment sectors 3.2.3.4 Upgrade of HCFC re-use system through strengthening R/R/R centers...... and improving...... local distribution... 36 of bulk HCFC/HFCs in support of container import regulations ..... 37 3.2.3.5 Destruction Pilot Project 3.3 COMPONENT 3 - MONITORING, LEARNING, AND ADAPTIVE...... FEEDBACK,...... OUTREACH AND...... EVALUATION4339 3.4 PROJECT INDICATORS, RISKS...... AND ASSUMPTIONS...... 4641 3.4.1 INCREMENTAL REASONING AND INCREMENTAL COST ANALYSIS

...... 46 5 3.5 PROJECT RESULTS FRAMEWORK...... 51 3.6 TOTAL BUDGET AND WORKPLAN...... 59 3.7 WORKPLAN IMPLEMENTATION SCHEDULE...... 62

4 MANAGEMENT ARRANGEMENTS...... 66

5 LEGAL CONTEXT...... 69

6 ANNEXES ...... 70 ANNEX 1 - RISK ANALYSIS ...... 70 ANNEX 2 - AGREEMENTS ...... 71 ANNEX 3 - TERMS OF REFERENCE:...... 72 PROJECT BOARD AND NATIONAL PROJECT MANAGER PROJECT MANAGER - TENTATIVE TERMS OF REFERENCE ADMINISTRATIVE AND FINANCE ASSISTANT - TENTATIVE...... TERMS OF R...... EFERENCE ...... 72 ANNEX 4 - MAZ KUPAVA CONVERSION PROJECT (141B...... TO C-PENTANE...... ) ...... 7478 ANNEX 5. ATLANT/DAVID GORODOK SOLVENT CONVERSION PROJECT (FOR “A...... TLANT”)...... 7597 ANNEX 6. PROVISION OF UNDP COUNTRY OFFICE SUPPORT SERVICES IN IMPLEMENTATION OF THE PROJECT “INITIAL IMPLEMENTATION OF ACCELERATED HCFC PHASE OUT IN THE CEIT REGION”...... 109

6 1 Situation Analysis

1.1 Global context and significance

HCFCs, a group of ozone-depleting chemicals, are used in a variety of applications such as refrigerants, foam-blowing agents, solvents, fire extinguishers and aerosols. In some cases HCFCs have replaced CFCs use due to their lower ozone depleting potential (ODP). The use of HCFCs is controlled by the Montreal Protocol on Substances that Deplete the Ozone Layer (Montreal Protocol or MP).

The Montreal Protocol was designed to reduce the production and consumption of ozone depleting substances in order to reduce their abundance in the atmosphere, and thereby protect the earth’s fragile Ozone Layer. The original Montreal Protocol was agreed on 16 September 1987 and entered into force on 1 January 1989. The Montreal Protocol includes a unique adjustment provision that enables the Parties to the Protocol to respond quickly to new scientific information and agree to accelerate the reductions required on chemicals already covered by the Protocol. The Parties to the Montreal Protocol have amended the Protocol to enable, among other things, the control of new chemicals and the creation of a financial mechanism to enable developing countries to comply. Specifically, four Amendments – the London Amendment (1990), the Copenhagen Amendment (1992), the Montreal Amendment (1997) and the Beijing Amendment (1999) have been made to the Protocol. Amendments must be ratified by countries before their requirements are applicable to those countries2.

The Copenhagen Amendment of the Montreal Protocol of 1992 stipulated that Article 2 countries need to reduce their HCFC consumption to 65% of their baseline in 2004, to 35% of that level in 2010, to 10% by 2015, to 0.5% in 2020 and finally achieve full phase out in 2030. The Beijing Amendment of 1999 extended control measures for HCFCs to production with a freeze in production by 2004 at the baseline. In September 2007, MOP 19 adopted the Montreal Adjustment on Production and Consumption of HCFCs, which entered into force on 14 May 2008. This requires that Article 2 countries accelerate both HCFC consumption and production to 25% of the baseline in 2010.

A number of GEF CEIT countries fall under Article 2 of the Montreal Protocol, and Belarus is a part of this group.

Such countries are generally eligible for GEF funding in support of HCFC phase out, subject to having ratified the Copenhagen amendment, which Belarus did in 2006 as detailed below.

Belarus is a developed country or Article 2 Party to the Montreal Protocol and all the amendments to it. As such it is subject to the phase out obligations so dictated, including those applied under Decision

2 http://ozone.unep.org/new_site/en/montreal_protocol.php

7 XIX/6 as addressed in the draft HCFC phase-out strategy. At the present time, Belarus is in compliance with all its obligations.

1.1.1 Issue background and baseline

Historically, the Republic of Belarus has never produced ODS, however, as in most industrialized countries, Belarus has been a consumer of CFCs and more recently of HCFCs. As a result, the country’s main efforts have and continue to be aimed at reducing and eliminating the use of such substances and replacing them with non-ODS alternatives. The main historical use of ODS has been in manufacturing of refrigeration equipment (blowing agent in the production of foam products and associated manufacturing, and/or as a solvent in metal parts and electronics cleaning during manufacturing processes), and in servicing refrigeration and air conditioning (RAC) equipment that was both manufactured in, or imported into the country.

The first stage of ODS consumption reductions was carried out between 1996 and 2000. In preparation for this, between 1993 and 1995, the Ministry of Natural Resources and Environment Protection of the Republic of Belarus (MEPNR) with the assistance of the Danish Government and the International Bank for Reconstruction and Development (IBRD) developed a National Program (Country Program) to end the use of ozone-depleting substances in Belarus, specifically in respect to the London Amendment and the Phase out of Annex A and B substances. This was formally adopted by Decree of the Cabinet of Ministers No. 115 in February 1996. It resulted in preparation of a GEF project entitled “Republic of Belarus: Ozone Depleting Phase Out Project”3 supported by a GEF project preparation grant and was approved by the GEF and IBRD for implementation in May 1997. This project, which involved US$6.9 million in GEF funding and US$7.9 million in national co-financing, was completed at the end of 20004.

The overall result of this project was the removal from use of more than 600 tons of Annex A ODS (CFC-11, CFC-12 and CFC-113) along with a significant improvement of the technological level and the competitiveness of manufactured products with introduction of the latest technological equipment. It also supported the establishment of the national regulatory and licensing system. More specifically, the project implemented the following sub-projects:

 Atlant CJSC (Minsk) converted from CFC-11 to cyclopentane in producing insulating foam and from CFC-12 to HCFC-134a (and subsequently R-600a) in the manufacture of domestic refrigerators as well as purchased equipment for the repair of domestic refrigerators by service centers throughout the country;

 Minsk Appliance Plant, Zavod Tsvetotron RUPP (Brest), Minsk Computer Production Association State Enterprise and Zavod Kamerton Unitary Enterprise (Pinsk), replaced cleaning of electronic components using CFC-113 and methyl chloroform with modern technology involving such things as a water-soluble solder flux process and high purity aqueous cleaning systems;

3 http://www.gefonline.org/ProjectDocs/Ozone%20Depletion/Belarus%20- %20Phaseout%20of%20Ozone%20Depleting%20Substances/Project%20Document.pdf 4 http://www-ds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2001/07/27/000094946_01071404014660/Rendered/PDF/multi0page.pdf http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2001/07/27/000094946_01071404014660/Rendered/INDEX/multi0page.txt

8  Beltorgprogress RPO acquired equipment for refrigeration equipment repair service centers and technicians for servicing commercial refrigeration throughout the country including: six recycling stations that recycle refrigerants for their subsequent reuse; a reclaiming station (fine purification of refrigerants); six ODS analyzers (gas analyzers); a gas chromatograph, and more than 1500 pieces of equipment for technicians, along with the training of 1,050 technicians; and

 Training in the recovery and replacement of halons in fire protection systems.

Overall, Belarus achieved the distinction of being the first country in the Former Soviet Union to meet its London Amendment obligations for Annex A and B ODS phase out and has generally been viewed as one of the most advanced countries in the region in addressing the ODS issue. Consistent with global practice, the replacement of CFC based technology has occurred in part through the use of HCFCs.

In terms of initial response to the GEF-4 cycle programme, a draft strategy document (HCFC phase-out strategy for Belarus) was developed in conjunction with the Ministry of Natural Resources and Environmental Protection of the Republic of Belarus (MNREP). The main objective of the strategy was to help ensure that the country be in respect of the obligations assumed under Decision XIX/6 of the Parties to the Montreal Protocol on the accelerated phase of HCFCs. It has been prepared as part of a regional Global Environmental Facility (GEF) project with UNDP/UNEP assistance and forms the basis for an intervention on continued capacity building of the country to implement the Montreal Protocol and investment support to strengthen national capabilities in dealing with HCFCs.

The HCFC consumption survey work, that was completed as a part of developing the draft phase-out strategy, provides a detailed description of the country’s regulatory framework and specifically control measures applied to HCFCs, and historical reporting of HCFC consumption based on the country’s established import licensing system. Using an analysis of regulatory control data related to HCFC consumption and direct surveys applied to distributors and end users of HCFCs, consumption estimates were updated and the nature of that consumption by application, sector and region were characterized. Likewise, analysis was undertaken for HCFC based equipment and products and on the utilization of non-ODS alternatives and technologies in the country.

The survey work conducted during the initial preparatory phase of the HCFC Phase-Out Strategy for Belarus indicated that the country was well advanced in terms of HCFC phase out relative to other CIS countries as some proactive actions such as HCFC import taxation had been implemented. The country has a strong regulatory framework in place, HCFC consumption is declining, remains well within the limits set by Decision XIX/6, and the country can generally be projected to achieve full phase out well in advance of 2020, when non-Article 5 countries must effectively achieve this status, if assistance additional to the previous CFC phase-out is provided to sustain the current capacities.

However, the country has some unique challenges imposed by its current Customs Union with the Russian Federation, something that has effectively negated its ability to comprehensively control imports of HCFCs as well as HCFC containing equipment and products as they enter the country. Historically, this has led to substantial under reporting of HCFC consumption. In recognition of this, Belarus adopted a methodology for HCFC regulatory control and consumption estimation based on the application of license limits applied internally within the country to end users of HCFCs. This approach has been used in 2009/2010 Montreal Protocol reporting and is recommended to be utilized in the

9 future, both for official reporting and establishing a phase-out schedule as the basis for HCFC phase- out.

In 2005, a study was undertaken for MNREP by the "Ekologia" Belarusian Research Center to evaluate consumption of ODS and particularly HCFCs in the country5 at the time. It appeared from the findings that ODS consumption, principally HCFCs, was approximately 180-200 MT/year. 50.6% was HCFC- 22, 23.4% were HCFC mixtures used as drop-in refrigerants in CFC-12 based equipment6, and 10.32% other HCFCs and mixtures, primarily HCFC-141b. This analysis demonstrated that the primary use of ODS was in the refrigeration and air conditioning sectors, mainly for servicing but with some manufacturing consumption. An analysis of overall refrigerant use in the country indicated that ODS accounted for 74% of all such use and with the elimination of residual CFC-12 use were effectively all HCFCs. The 16% share at that time for non-ODS refrigerants involved ammonia, HFC-134a and HFC- 404a. Smaller but more easily addressed consumption also occurs in the manufacturing sector, namely in the use of HCFC-141b in foam blowing and solvent applications.

The work undertaken to obtain estimates of actual HCFC consumption in the country was not definitive but allowed the range of consumption to be defined and an approximate consumption amount to be used for purposes of more realistic reporting and for developing a phase out strategy. The upper limit of HCFC consumption was assumed to be defined by the limits imposed by the licensing system applied to end users in the country. Given the official status of this information it can serve as an annual regulatory limit on consumption. In the absence of more accurate official data, this was used for reporting to the Ozone Secretariat, noting that it likely over reports actual consumption. This approach was taken in the country’s 2009 reporting where 10.4 ODP MT of consumption along with 2.9 ODP MT of HCFC-141b in fully formulated polyol were reported. This compared to the actual reported consumption against the 2009 limit of 3.2 ODP MT or the amount of 2008 consumption identified from direct end user surveys of 4.1 ODP MT7. It should be noted that it is anticipated that both the reporting of actual consumption as determined by reporting against limits or direct end user survey work can still be expected to underestimate real consumption by some degree.

Current HCFC consumption in Belarus is capped by a limit of 10.4 ODP MT by both end users and distributors. This trend would indicate that a complete phase out should be achievable by 2015, given adequate external assistance to facilitate, and this was recommended as the target on which the national HCFC phase out strategy was to be based.

Analysis of the data obtained during the preparation of the Draft Strategy described above suggests the following:

 Belarus’ overall official reported consumption of HCFC’s, based on import licenses, has been generally declining since 2004. Reasons behind that are related to the introduction of HCFC taxation on import and at the same time to underreporting due to inability to capture imports due the functioning of the Customs Union;

5 RUP Belarusian Research Center “Ekologia”, Report No 93/3.8/47-2005, State Registration No 20052742) 6 Primarily a proprietary Russian manufactured blend known as Astor 12 or C10M1 that is a mixture of HCFC-21, HCFC22 and HCFC-142b 7 Made up of 3.7 ODOP MT from the end user survey results, 0.4 ODP MT of manufacturing solvent use.

10  Reporting on the basis of internal licensed limits applied to end users and distributors suggests substantially higher consumption, although the level remains in compliance, and if this does not increase would be so through to 2015 after which potential non-compliance can be expected in a scenario that no action in the servicing sector is taken;  HCFC-22 has been the principal HCFC imported and used in the country although the officially reported amounts have dramatically declined since 2000/2001 to the point where HCFC-141b was the primary HCFC officially imported and reported;  Prior to 2004, consumption of the different types of HCFCs was consistent with a distribution of manufacturing and refrigeration servicing applications, notably a relatively high proportion of HCFC mixtures characteristic of use as drop-in replacements for CFC-12, something that suggested continued use of older inefficient CFC based equipment;  The above trends appear to continue based on corrected 2009 reporting

From an institutional point of view the previous capacity has degraded in recent years due to public sector budgetary reductions imposed further to current global and local economic conditions. In 2002 the Ozone Office was integrated into the Interregional Specialized Inspectorate for State Control over the Protection of Air within MNEP and the national budget assumed responsibility for all functions related to regulation, monitoring and international reporting related to ODS matters. This included dedicated staff, which was essential for the implementation of CFC phase-out programme. In 2006, the Specialized Inspection created a new department (4 persons) that were entrusted with the issues dealing with air and ozone layer protection and functioned as the NOU and international focal point. In late 2009, the Ministry of Natural Resources and Environment Protection was reorganized and ozone layer protection themes are now assigned to the Management of Regulatory Effects on Atmospheric Air and Water Resources. However, this was also associated with a substantial staff reduction.

In order to meet its Montreal Protocol obligations through effective HCFC phase-out, a Draft Strategy for HCFC Phase-Out in Belarus was formulated that describes a number of actions to be pursued in order to implement full phase out of HCFCs by 2015. These cover the following:

- Strengthening regulatory controls on HCFC consumption, limits and bans on import and licensed use of HCFC based equipment and products and enhanced regulation of refrigerant distribution and application practice; - Strengthening institutional and technical capacity through training of environmental enforcement, customs and refrigeration servicing personnel; - Elimination of HCFC consumption in the manufacturing sector with investment in conversion to non-ODS alternatives; - Upgrading technical capability in the refrigeration servicing sector with investment in refrigerant management equipment and infrastructure; and - Implementation of demonstration projects for low GWP refrigerants and application of incentives for HCFC equipment retrofit/replacement. It is anticipated that implementation of these actions will be supported by financing from a new GEF project, along with national funding.

11 The current full-size proposal is a response to the obligations incurred by Belarus under the phase out schedule for HCFCs of the Montreal Protocol, as amended by the Copenhagen amendment and the subsequent adjustment adopted by the Parties to the Montreal Protocol at MOP 19 in September 2007. Respectively, it further incorporates above listed components and it is a timely capacity building effort (with investment elements for the servicing sector) that is well placed to improve regulatory measures to help address the accelerated HCFC phase-out in the medium and longer term, and strengthen the country’s preparedness for the complete phase-out of HCFCs from current use.

In addition, as indicated below, there remain a number of significant issues that need to be addressed to sustain the positive progress toward eliminating HCFC consumption. It is expected that these will require a range of actions on the part of government and enterprises, forming the basis for the country’s phase out strategy:

 Limitations on ability to control imports - Due to the Customs Union arrangements with Russia and now Kazakhstan, Belarus presently has limited ability to control HCFC imports or apply available economic instruments;  Under utilization of current limits regulations - While an excellent regulatory framework exists for application of limits to the sale, distribution and end use of HCFCs internally this needs to be maintained and expanded to provide reliable ability to report and control HCFC;  Sustainability of institutional capacity - At a general level, the sustainability of Belarus’ good performance in ODS phase out requires maintenance of its historically strong institutional capacity in this area, something that has recently declined and could represent a significant risk to its progress in ODS phase out generally;  Manufacturing consumption - Residual HCFC consumption in the manufacturing sector using outdated technology remains and will likely diminish the competitiveness and export market access of these enterprises in the future;  Refrigerant management capacity - Given that refrigeration servicing remains the dominant application for HCFC technology, the country’s overall capacity in refrigerant management needs to be strengthened to ensure recovery and recycling is maximized, capacity for alternative technologies exists, and ultimately management of “end of life” refrigerants is provided for and fully utilized;  Introduction of Low GWP Technologies - While Belarus has effectively introduced non-ODS alternatives in the form of HFC based technology, there is limited penetration of newer low-GWP technology, except in domestic refrigeration (hydrocarbons) and a few large industrial refrigeration applications (ammonia). This technology will increasingly be the international standard in markets in which Belarus will compete.

The country strategy that is adopted for HCFC phase out essentially involves addressing each of the above issues. It is proposed that this be done with an overall strategic policy framework that sets specific national phase out objectives, and establishes and implements an action plan that defines the activities required to achieve this.

12 On the technical support level, the HCFC management plan, prepared in support of the HCFC phase- out strategy implementation and detailed in the current document, consists of two overall assistance components:

(-) Component 1 is in essence an enabling activity conceived as a regional strategy (regional component – implemented by the UNDP Bratislava Regional Centre in accordance with the respective UNDP rules and procedures) and includes four main sub-components; (-) Component 2 is nationally oriented and includes capacity building, training, manufacturing sector phase-out and servicing infrastructure investment.

The regional component aims to provide common Russian language regulatory guidance, “train the trainers” opportunities related to regulatory enforcement, customs control, expanded licensing and integration of HCFC Phase-out with energy efficiency/GHG reduction, training materials for transfer to national level programs, and expanded country exposure within the existing ECA network. It has been developed to build on the tools and networks currently in place for some CEITs and the Article 5 countries in the CIS and is to be accessible to all non-Article 5 CIS countries in the region, although direct participatory funding support will be confined to the four countries participating in this project (Belarus, Tajikistan, Ukraine and Uzbekistan).

At the regulatory level, the country specific components will ensure the implementation of enhanced HCFC regulation/import control, enhanced licensing systems, and introduction of HFC monitoring inclusive of working enforcement level training. These components will be complemented by training, to strengthen enforcement (environmental and Customs officers to control HCFC end-use and imports) and operational refrigeration-servicing sectors (training, certification, RAC Association), including promotion of energy efficiency and GHG reductions during servicing.

In addition, under this component, investment programs will cover technological conversions in solvent and rigid foam sectors, pilot retrofit/replacement incentive programs targeting priority high service demand sectors, and strengthening of refrigeration service capacity and optimizing chemicals distribution to allow control of container size, as well as preparing collection/storage modalities for destruction facilitated by a pilot destruction project.

Where cost effective/economically sustainable opportunities are identified, pilot investments in direct consumption phase-out will be undertaken specifically in the foam, refrigeration and solvent sectors.

1.1.2 Global and environmental benefits

The principal global environmental benefit from the project is the phase-out of HCFCs import and consumption in Belarus to assist the country to gradually reduce dependence on HCFCs and implement its obligations with respect of the Montreal Protocol.

This will be achieved directly during the project period by activities related to building the capacity of the country in better controlling the end use and imports of HCFCs and HCFC based equipment on one side and handling the demand for HCFCs by implementing HCFC re-use system on the other. Component 1 will support the country in exchanging important experiences with other Governments in the region, and, thus, improving HCFC management approaches at the national level. Component 2 will build the Government and private sectors’ capacity to reduce their dependence on imports of HCFCs

13 through technological conversions to low GWP technologies or closed loop processing (in case of solvents), strengthening the equipment maintenance practices and HCFC re-use scheme. Demonstration of alternative technologies (HFC, ammonia through equipment retrofit/replacement) in various sectors, such as commercial milk cooling equipment, will help reduce barriers related to the acceptance of such technologies on the national level (performance, costs of retrofits etc) and will also lead to energy savings to generate wider interest in these and incentivize larger scale technological transitions in future when HCFCs import will be limited. ODS destruction project will assist the country in disposing of obsolete ODS with the potential broader benefit of providing this capability regionally.

The following summarizes specific global environmental benefits attached to phase-out of HCFCs in Belarus that will be derived from the project:

 Country’s compliance with the Montreal Protocol by phasing out the total available HCFC consumption of 227.28 MT of HCFCs in an accelerated manner by 2015 and preparing the country’s capacity to sustain this achievement;  Strengthened institutional capacity of the country to improve decision-making related to HCFC phase-out approaches and to exercise effective regulatory controls over the end use and import of HCFCs and HCFC based equipment. This will be achieved through regional experience exchange with other Parties to the Montreal Protocol from the region, improvements in the current legislation as well as through building capacities of environmental inspectors to monitor and control HCFC end use and of Customs to detect HCFCs/blends/equipment at the entry points and enforce regulatory measures as required by the law;  Resulting enhanced knowledge base in terms of information management and technical capacity to sustain planning, decision making and program execution related to HCFC phase-out, as well as engage in effective information exchange nationally and globally;  Technological conversions in the manufacturing sector with selection of low GWP technologies such as c-pentane;  Improved Recovery/Recycling/Reclaim infrastructure to help strengthen the HCFC re-use scheme in the country to minimize the need for HCFC import and reduce HCFC emissions into the atmosphere;  Strengthened unwanted ODS waste storage capacity at the level of service centers in support of HCFC re-use scheme and to capture unusable quantities of HCFCs and unrecognizable blends containing HCFCs;  Pilot destruction demonstration project aiming to destroy unusable and/or contaminated/unrecognizable blends. This capacity will in addition provide regional destruction capability within the Customs union with Russia and Kazakhstan; Improved HCFC/blends analytical capacity at the country level to resolve arguments on the content of incoming refrigerant gas in case of mislabeling of packaging and in support of the HCFC re-use system to certify the quality of purified refrigerants;  Demonstration of strong synergies between the ozone layer depletion (HCFC phase-out) and climate change benefits (reduced HCFC emissions and energy-savings) when piloting alternative technologies retrofits/replacement) in the refrigeration and A/C sectors and testing the system of HCFC re-use/unwanted ODS storage;

14  Creating a high level of awareness by policy makers, stakeholders and the public on the need for HCFC phase-out, which will stimulate sustained attention to the issue and timely responses

In the context of inter-departmental cooperation, the project will improve collaboration between key Governmental departments (Ministry of Natural Resources and Environmental Protection, Customs) to strengthen overall sound chemicals management concepts. The principal global environmental benefit from the project is estimated to be the amount of avoided consumption, which would occur by achieving compliance as opposed to a base case of no action and continued growth in consumption.

1.1.3 Linkages with CP, UNDAF and CCA

This project seeks to give input to the preparation and implementation of formal HCFC Phase out strategy and action plan consistent with Decision XIX/6 and which serve as direct input to the updating of the existing Country Program.

The formal adoption of Decision XIX/6 control measures within the country’s legal and regulatory system, will give practical substance to being able to achieving and maintaining country compliance as committed to by countries through their ratification of current amendments to the Montreal Protocol.

The Republic of Belarus was among the first countries to sign the Vienna Convention and the Montreal Protocol. By signing the Montreal Protocol on January 22, 1988 and ratifying it on October 31, 1988, Belarus undertook to reduce and phase out the consumption of ODS and continues to fully implement these measures. The first of these obligations was practically assumed with the ratification of the London Amendment in 1996. On December 18, 2006, the Copenhagen, Montreal and Beijing amendments to the Montreal Protocol were adopted under Law No. 184-3 of the Republic of Belarus. The adopted amendments entered into force in the Republic on June 11, 2007. Belarus is a developed country or Article 2 Party to the Montreal Protocol and all the amendments to it. As such it is subject to the phase out obligations so dictated, including those applied under Decision XIX/6 as addressed in this strategy. At the present time, Belarus is in compliance with all its obligations.

The project is aligned with the Country Programme in ODS phase-out - specific policy priorities and commitments related to ODS phase-out are defined by Decree of the President of the Republic of Belarus No. 502 of October 15, 2007 "About the prohibitions and restrictions on the transfer of certain types of goods across the customs border of the Republic of Belarus" and Article 48 of the Customs Code of the Republic of Belarus. In parallel, the country has made similar policy commitments to a number of other chemicals related environmental conventions and agreements. These include the Stockholm Convention on Persistent Organic Pollutants (2004), and the Basel Convention on the Control of Trans-boundary Movement of Hazardous Waste and its Disposal (1999). The country has also subscribed to the 2008 Dubai Declaration on a Strategic Approach to International Chemicals Management (SAICM).

It fits with the country’s evolving priorities associated with sound chemicals management as reflected in the other priority environmental management initiatives related to addressing national priorities associated with other POPs issues, hazardous waste management and SAICM that are being supported by the Government.

15 The project is consistent with UNDAF through the following outcomes and outputs:

UNDAF Outcome 3. Environmental sustainability is increased:

 National system for sound management of chemicals is strengthened.  Health system capacity to better assess and address environmental determinants of health is strengthened.  Mechanisms of cross-sectoral cooperation and partnerships towards sustainable development are developed.  National cleaner production (CP) capacities are strengthened by fostering dialogue between industry and government, by enhancing investments for transfer and by development of environmentally sound technologies.

1.2 Key Barriers

Belarus, while proactively assuming national obligations under the Montreal Protocol has faced some gaps related to lack of technical assistance to continue with the successful implementation of such obligations that emphasizes the need to international support. At a more specific level, the following major barriers can be identified and which are being explicitly targeted in the project’s design:

 Advanced Accelerated HCFC Phase Out: Being in part geographically and economically driven, the country in effect would be attempting to rapidly harmonize its HCFC phase out performance with that of the European Union, which legislated phase out of new HCFCs in 2010. Therefore, in the proposed draft HCFC phase-out strategy, the country would like to opt for the phase out HCFCs totally by a date earlier than 2020 something that current trends would indicate would also be achievable, albeit likely with proactive action being taken in a number of areas. Based on these intentions, the project will help in removing those barriers listed below which prevent the country from doing as well as to remove the need to rely on additional technical assistance in future.  Sustainability of institutional capacity: At a general level, the sustainability of Belarus’ good performance in ODS phase out requires maintenance of its historically strong institutional capacity in this area, something that has recently declined and could represent a significant risk to its progress in ODS phase out generally. This limits the country from participating in regional knowledge sharing platforms and collaboration with other Governmental partners to assimilate and implement best available approaches in controlling HCFC import and phase-out. In order to help the country stay up-to-date with the current developments in the Montreal Protocol, assistance is required to continue regional and sub-regional cooperation of NOOs and other project partners such as Customs and refrigeration association.  HCFC consumption in the manufacturing sector that requires technical assistance: HCFC-141b, in the annual quantity of up to 60-65 metric tons, is consumed in the manufacturing sector in Belarus in terms of foam blowing and solvent agents. While the consumption of HCFC-141b in the manufacturing sector is rather minimal in comparison with HCFC use in servicing sector, the dependence on HCFC-141b cannot be removed without technical assistance in this area. Such residual HCFC consumption in the manufacturing sector using outdated technology remains, which will diminish the competitiveness and export market access of these enterprises in the future.

16  Refrigerant management capacity: The large majority of HCFC consumption is in the refrigeration servicing sector (96%) involving primarily HCFC-22 but also a significant consumption of HCFC mixtures used in obsolete old CFC-12 based equipment. Unlike many countries, the majority of identified service demand is for commercial refrigeration equipment (70%) rather than A/C equipment, although the significant unaccounted for consumption in the A/C sector exists and is being sustained by new HCFC equipment imports is in the A/C sector, specifically for smaller domestic units. Given that refrigeration servicing remains the dominant application of HCFC technology, the country’s overall capacity in refrigerant management needs to be maintained and strengthened to ensure recovery and recycling is maximized, capacity for alternative technologies exists, and ultimately management of “end of life” refrigerants is provided for.  Absence of ability to effectively limit import of HCFC containing equipment that creates a long- term HCFC “consumption bubble”: The system of import permitting as a control mechanism is more effective for HCFC containing equipment and products but it will also be substantially undermined by the Customs union with Russia which is a major supply route for refrigeration equipment (originating in Asia), particularly used equipment that would logically be targeted for limits and potentially bans under current regulations as a main method of phasing out HCFC consumption.  Current Import Licensing System is ineffective and unsuitable for Consumption Reporting: While a nominally comprehensive import licensing system is in place for HCFC chemicals, it is effectively not functional because of the absence of any effective customs control at the countries border with Russia which has led to the majority of HCFCs and essentially all refrigerants (which account for virtually all HCFCs actually consumed) now entering the country without permits to avoid the environmental taxation on ODS. In any event, the creation of a formal Customs Union with Russia and Kazakhstan in 2010 effectively eliminates the feasibility of import control by a licensing/customs control mechanism. Given that import licenses have historically been used as the basis for officially reported consumption to the MP Ozone Secretariat, it is imperative that another method be selected and officially adopted to more accurately report consumption for compliance purposes, such as HCFC sale, distribution and use permits. As noted in the draft outline of HCFC phase-out strategy, this does produce much more reliable information related to ODS consumption but remains limited by a combination of lack of awareness on the part of stakeholders, and MNEP resources to do so, particularly to establish a comprehensive registry of end users of refrigeration and A/C equipment using HCFCs for servicing, and implementing effective reporting from them.  Lack of ability to monitor the incoming ODS materials in gas containers: Due to challenges described above (Customs Union) as well as reported accumulation of emptied single-use containers with residual amounts of HCFC gas, one of the regulatory options the country would like to adopt and implement is the ban on use of such HCFC containing single-use containers. In support of this measure it is planned to establish a system of HCFC re-use with a limited scale, pilot destruction capability for the unwanted quantities of ODS. This will help in preparing the country’s capability for a full-cycle ODS management at national level.  Limited availability of technical tools to test gas composition and quality as well as to limit emissions of HCFCs during equipment maintenance: In combination with previously discussed measures to control consumption of HCFCs at sale, distribution and end-user level, and as there is a range of chemicals (HCFCs, HFCs and their blends) that may enter the country (from Ukraine, or other borders than with the Russian Federation), additional (universal) analytical equipment should be supplied to Customs to deal with a range of these chemicals as well as various mixtures. There

17 are gaps in technical capacity in the form of required analytical capability to test the content and quality of incoming HCFCs as single substances and in blends. Previously supplied portable analytical equipment is outdated due to elapsed operational time since its supply in the beginning of the previous decade.  Introduction of Low GWP Technologies: While Belarus has effectively introduced non-ODS alternatives in the form of HFC based technology, there is limited penetration of newer low GWP technology, except in domestic refrigeration (hydrocarbons) and a few large industrial refrigeration applications (ammonia). This technology will increasingly be the international standard in markets in which Belarus will compete. Such limited exposure to low GWP alternative technologies and understanding of energy-saving aspects of new modern equipment operational on new technologies are the main barriers in the equipment installation and servicing sector. A range of demonstration projects in this area should be planned for.  Lack of capability to address the growing amounts of unwanted ODSs: Country has been estimating a growth in obsolete ODSs, and expects that the HCFC phase-out process will further facilitate an increase in stockpile of HCFCs and their mixtures not suitable for recycling and re-use. Apart from that waste coming from the re-use system (accumulation rate is expected to reach 0.5 tons/year), approximately five thousand (5,000) cylinders are considered to be a reasonable amount for collection within an easier reach – around capital area (based on interviews with larger importers), though the work shall be legislatively mandated to take better effect. Sixty (60) percent account for HFCs and forty (40) percent for HCFCs (with 30% for HCFC-22 and the rest for its mixtures). Provided the minimum contained, non-evacuated fractions on the average representing 200g per cylinder (reaching 350g/unit), the content of halocarbons is expected to reach one (1) metric ton. There is an experience in the country of incinerating unwanted ODSs domestically, however, technologically it was found not be sound and safe. With further accumulation of such waste, the country requires capability to address these growing stocks through improved storage and accumulation capacity and then local level, limited scale destruction.

1.3 Stakeholder analysis

During the formulation of the HCFC phase-out strategy a stakeholder analysis was performed which is summarized below.

Name of the institution, organization Description of the role and activities Ministry of Natural Resources and Control of the use and consumption of ODS, licensing, Environment formulation of legal-normative documents

"Ekologia" Belarusian Research Center Scientific support in the area of control over the handling of ODS

Ministry of Agriculture and Food Implements the state policy in the area of the consumption of ODS Products by subordinate agricultural enterprises, as well as investing into the modernization of equipment

Ministry of Industry Implements state policy in the area of consumption of ODS by subordinate industrial enterprises (as part of solvents, foam- forming materials)

18 Name of the institution, organization Description of the role and activities Ministry of Trade Implements state policy in the area of consumption of ODS by subordinate retail enterprises in the cities State Customs Committee Provides control of the implementation of Council of Ministers Resolution No. 1397 during customs clearance of goods imported into (exported from) the country (ODS and ODS-containing products) Belarusian Republican Union of Implements state policy in the area of the consumption of ODS by Consumer Societies subordinate retail enterprises in rural settlements Belarusian Railway Coordinates the consumption of ODS by its structural units as the part of the Ministry of Transport and Communications Belarusian State Concern for Oil and Coordinates the consumption of ODS by enterprises in its group Chemistry Institute of Power and Nuclear Research into the characteristics of refrigerants, their application Research-Sosny of the National in various equipment. Academy of Sciences of Belarus Association of Microclimate and Cold Activity is related to production, design, delivery, maintenance of Industry Enterprises APIMH (non-profit refrigeration and air conditioning equipment organization) Belarusian National Technical Provides training in the field of refrigeration equipment and University, Faculty of Heat and technology Ventilation Mogilev State Food University HVAC Provides training in the field of refrigeration equipment and Faculty technology

Polotsk State University Provides training in the field of refrigeration equipment and technology Minsk State Vocational School No. 38 Provides trade training in the field of refrigeration equipment and of Processing Industry technology

Potolsk Commerce and Technology Provides trade training in the field of refrigeration equipment and College of the Belarusian Republican technology Union of Consumer Societies Kholodon CJSC, including its affiliates: Assembly of commercial refrigeration equipment and air- conditioning systems, sale, supply, installation, repair, maintenance, control, including remote control of the work of refrigeration equipment, supply of refrigerants, production of refrigeration units of various power configurations and for various purposes. Ostrov JLLC Assembly of industrial compressor and condensing units. Performs work on designing and manufacturing various models and configurations of refrigeration units on the basis of component parts from the world's leading manufacturers, as well as the completion, installation and implementation of commissioning. Government enterprise Repair of commercial refrigeration equipment TORGTEHNIKA and affiliates Stokfer LLC Delivery of refrigerants, sales of air conditioners, wholesale trade Bravo LLC Supply and sale of commercial refrigeration equipment SIBRO-INVEST LLC Supply and sale of Freon gas

19 Name of the institution, organization Description of the role and activities TODO Rostok Supply and sale of Freon gas, repair of refrigeration equipment Kholodilnoye Oborudovanye Trade, manufacture, supply, installation of refrigeration ALC (Refrigeration Equipment) equipment, supply of CFCs Agroprom-kholod Private Enterprise Trade, manufacture, supply, installation of milk-coolers and other commercial refrigeration equipment

Belfriteks LLC Refrigeration equipment, manufacture, supply, installation of industrial refrigeration equipment, liquids cooling systems, equipment for fruit and vegetable storage Brimstone-Bel JLLC Equipment for trade, refrigeration equipment, manufacture of commercial refrigeration equipment of ТМ Golfstream with remote and built-in cold Atlant CJSC Production, sale, repair of household and commercial refrigerators, Production of refrigeration compressors Nesvizhskiy Tayagroservis OJSC Production of milk-cooling systems for agriculture, reconstruction, formerly Nesvizhskaya RAPT repair, conversions to ozone-friendly refrigerants

The project will be implemented in close coordination and collaboration with relevant government institutions, regional authorities, industries, public and local authorities and NGOs, as well as with other related relevant projects in the region through enhanced networking. Organizations taking part in the pilot projects are responsible for custom clearance of the equipment and materials procured within the respective pilots.

There are a number of related international initiatives in Belarus and regionally with which this project will coordinate activities.

The following lists these specific initiatives:

 Regional MSP GEF/UNDP/UNIDO/UNEP/WB : “Preparing for HCFC phase out in CEITs: needs, benefits and potential synergies with other MEAs: Bulgaria, Kazakhstan, Ukraine, Tajikistan, Belarus, Uzbekistan, Azerbaijan and the Russian Federation” which has been instrumental in collecting HCFC consumption related data and formulating draft outlines of HCFC phase-out strategies for the involved countries;  Regional FSP GEF/UNDP: “Initial Implementation of Accelerated HCFC Phase Out in the CEIT Region: Ukraine, Belarus, Tajikistan and Uzbekistan” is currently under formulation (last stage) and helps develop approaches to HCFC phase-out in the region through future regional information and experience exchange;  MLF/UNDP/UNEP project on implementation of HPMP (HCFC phase-out management plan) in Kyrgyzstan (Stage 1 until 2015), which was approved in 2010 and is currently under implementation. The project has been designed to explore similar activities;  MLF/UNIDO project on implementation of HPMP in Turkmenistan (Stage 1 until 2020) which was approved in 2010 and is currently under implementation. The project has been designed to explore similar activities;

20  MLF/UNDP/UNEP project on implementation of HPMP in Armenia (Stage 1 until 2015), which was approved in 2010 and is currently under implementation. The project has been designed to explore similar activities;  MLF/UNDP project on implementation of HPMP in Moldova (Stage 1 until 2015), which was approved in 2010 and is currently under implementation. The project has been designed to explore similar activities;  MLF/UNDP project on implementation of HPMP in Georgia (Stage 1 until 2020), which was approved in 2010 and is currently under implementation. The project has been designed to explore similar activities;  MLF/UNDP PRP for formulation of ODS waste destruction project in Georgia;

The project will also cooperate with other HCFC phase-out initiatives in the region once those are formulated and approved for implementation.

1.4 Baseline analysis

In the absence of international assistance and specifically GEF funding, it is reasonable to assume that progress on the implementation of the HCFC phase-out strategy in the country would expectedly slow down with limited activities initiated to modernize HCFC use legislation and capacity, though with continued strategic orientation, in the view of proximity to, towards experiences on HCFC phase-out approaches and practices adopted in the European Union.

The currently applied approaches to monitor and control HCFCs imports (heavily levied as compared to HFCs substitutes) will continue to be substantially weakened by inability to register and regulate HCFC (and equipment) imports which, in their vast majority, originate coming through the Russian Federation. In result of current implications coming from the introduction of Customs’ Union between Belarus and Russia, growth in HCFCs imports and increase in HCFCs based refrigerated equipment banks are both expected which will undermine the ability to reduce HCFC consumption in the short to medium term. Institutional gaps, which appeared after recent post-restructuring cuts in ozone-program associated office personnel (whose current tasks focus more on air protection law enforcement activities) will undermine the efficiency of HCFC phase-out activities. GEF co-financing will help sustain a degree of political interest in the accelerated HCFC phase-out and keep required staff in place and in tune with the Montreal Protocol obligations incurred by the country. Finally, limitations in skills and modern HCFC/HFC recovery/re-use equipment/tools in the servicing sector will further reduce the preparedness of the country in successfully addressing the HCFC phase-out and environmentally safely handling HFCs as well as low GWP technologies serving HCFC substitute purposes.

The eventual, delayed replacement of HCFCs largely with HFCs and their blends, comparably to prevailing trends in EU countries, is the most realistic longer term scenario for the country. Without advanced legislative improvements to control handling of HCFCs on the end user level, in a manner as much as possible mirroring requirements of the EU F-Gas regulation despite recently reported implementation gaps8, and skilled law enforcement backed by increased and sustained capabilities of HCFC users to minimize leakage, increase HCFC re-use rates, and easier adoption of alternatives, the

8 http://ec.europa.eu/clima/policies/f-gas/index_en.htm

21 HCFC phase-out is unrealistic to achieve. Coupled with other legislative improvements such as forward looking bans on assembly and installation of used and new HCFC-based equipment, especially large units, and technician skills certification, the phase-out process will become more sustainable. The information exchange platform, which is planned for the regional cooperation with other partner countries, will greatly assist in more effective policy developments to better control HCFCs import and use in national settings.

In response to these challenges (baseline), GEF assistance will serve to support HCFC phase-out in the country, as was the case in the past with CFC phase-out.

2 Strategy

2.1 Project Rationale and Policy Conformity

The project is designed to be aligned with GEF strategic programs and priorities, and specifically the GEF Operational Strategy for ODS. This project is a response to the obligations incurred by Belarus as CEITs (non-Article 5) under the phase-out schedule for HCFCs of the Montreal Protocol, as amended by the Copenhagen amendment and Decision XIX/6.

At a high level, the project directly supports the overarching GEF goal for the ODS focal area to protect human health and the environment by assisting countries to phase out consumption and production, and prevent releases of ozone-depleting substances (ODS) according to their commitments to the Montreal Protocol phase-out schedules, while enabling energy-efficient alternative technologies and practices, and consequently contribute generally to capacity development for the sound management of chemicals. In meeting this overall objective, the project was designed to address the ODS focal area’s strategic programme, which is aimed at phasing out of HCFC (from production and consumption) and strengthening of capacities and institutions in participating countries. More specifically, this is in reference with the GEF Focal Area Strategy and Strategic Programming for GEF-4 document on Ozone (GEF/C, 31/10 May 11, 2007), which contains the following main objective:

 For the period of GEF-4, the GEF will assist eligible countries in meeting their HCFC phase out obligations under the Montreal Protocol, and strengthening capacities and institutions in those countries that still are faced with difficulties in meeting their reporting obligations.

More specifically, the project addresses the following two Outcomes of Strategic Program 1 on phasing out HCFCs and strengthening of capacities and institutions for GEF-4:

(a) HCFCs are phased-out according to Montreal Protocol schedule, or faster, in GEF-eligible countries; (b) GEF-eligible countries meet their reporting obligations under the Montreal Protocol

The GEF goal and its strategic objective are directly addressed in the project objective and its overall design. Similarly the project outcomes and the indicators match the impacts and main indicators defined in the GEF strategy as related to HCFCs, and the project meets the requirements of the Strategic Program 1 in the following Indicators:

22 (a) ODP adjusted tons of HCFCs phase-out from consumption – For Belarus, the project will achieve the reduction of 10.5 ODP tons of HCFCs which will represent the total HCFC phase-out in 2015 in advance of MP stipulated HCFC consumption reduction steps (inclusive of managing the latent demand of 67 MT (3.7 ODP)/annually); (b) Percentage reduction in HCFC consumption in the participating countries - the project will achieve country’s early compliance with the Montreal Protocol by phasing out 100% of remaining HCFC consumption; (c) Percentage of GEF-funded countries that meet their reporting obligations under the Montreal Protocol – Belarus will have sufficient capacity to meet its reporting obligations under the Montreal Protocol, thus, reducing the number of eligible countries.

In line with the GEF’s requirements for the type of projects to be supported, the present project is of a dual nature: (1) enabling-type of activities (such as regional Component 1 on experience exchange and networking as well as the full formulation and adoption of the HCFC phase-out strategy) and (2) technical assistance and capacity building activities (technological conversions in the manufacturing sector, tools supply to environmental and Customs inspectors, and technicians with required trainings, modernization of R/R/R capacity for larger service centers and Refrigeration Association, establishment of destruction pilot demonstration project, and demonstration of alternative technologies in the servicing sector through limited end-user equipment retrofits for milk cooling sector).

Through the combination of two such approaches (regional and national), the project is expected to achieve the GEF-4 indicators listed out above, and thus facilitate the country’s compliance with the Montreal protocol’s requirements.

The project is also consistent with GEF strategic objectives related to linkages to the Climate Change Focal area through promotion of low GWP alternatives, and preparation for potential future control measures on HFCs.

An additional aspect that needs to be considered is the integration of HCFC Phase out with other global environmental priorities as promoted by both Decision XIX/6 and the GEF-4 Operational Strategy for the Ozone Focal Area9 and looking forward to the GEF-5 Chemicals Focal Area Strategy10 that ODS interventions are a part of. The project is aligned with and reinforces broader global environmental priorities related to climate change and the principles of sound chemicals management.

Minimizing climate change impacts as part of HCFC phase out will generally involve the integration of the use of low GWP non-ODS alternative technology, and implementation of phase out measures that enhance energy efficiency such that the lowest Total Equivalent Warming Impact (TEWI) is achieved. This will mean that in the near term HFC based technologies with relatively high GWP will inevitably be utilized. This effectively mirrors the past and current experience in advanced non-Article 5 countries. However, the anticipated rapid commercialization of a number of low GWP options in these countries, particularly the EU, will create opportunities to introduce and demonstrate these technologies as they become more widely used and increasingly cost competitive in more mature markets.

http://www.thegef.org/gef/sites/thegef.org/files/documents/GEF_4_strategy_ODS_Oct_2007.pdf 9 http://www.thegef.org/gef/sites/thegef.org/files/documents/GEF5%20Focal%20Area%20Strategies.pdf 10

23 Additionally, the strategy’s emphasis on upgrading refrigeration-servicing capacity capitalizes on the linkage between improved maintenance and recovery practice with lower leakage rates (hence GHG emissions) and improved energy efficiency. ODS waste destruction will also provide benefits to climate change by reducing amount of ODSs reaching atmosphere.

3 Project Goal, Objectives, Outcomes and Outputs/Activities

The Project aims to speed up the phase out of facilitate phasing out ozone depleting substances, particularly HCFCs and their substitution with modern alternative substances in accordance with the respective Belarus’ obligations under the Montreal Protocol, along with strengthening the system of import control and management of HCFCs in Belarus.

The project task is to ensure Belarus’ compliance with the timetable for HCFCs phasing out established by the Montreal Protocol and compliance with the European Union requirements with respect to the use of ozone depleting substances to ensure free access for Belarusian manufacturers of refrigerating and other equipment and vehicles.

The overarching theme that underlies the GEF Project Scenario described below is providing the country with the tools to achieve effective compliance with respect its obligations in front of the Montreal Protocol and the objective of protecting human health and the environment by assisting countries to phase out consumption and production, and prevent releases of ozone-depleting substances.

The project design has been developed to specifically address the principal barriers identified above within the overall project component framework set out in the original PIF but with appropriate further elaboration and, where required, expansion of outcomes and outputs based on the PPG work.

In the following the two primary project components listed in the Project Framework are described along with the sub-components each of which are aligned with the outcomes and outputs as elaborated in Annex A:

 Component 1 (Regional information exchange and networking component). It addresses barriers associated with incomplete knowledge and awareness and is aligned with the PIF Component 1; Outcomes 1(a-d).  Component 2 (National capacity building and technical assistance component) targets support to the adoption of the fully completed HCFC phase-out strategy (with selected legislative options to control HCFC end use), capacity building and supply of analytical and servicing equipment/tools for Customs Department and refrigeration technicians, technological conversions in the manufacturing sector (MAZ-Kupava and Atlant/David-Gorodok) modernization of HCFC re-use scheme in the country and demonstration of alternative technologies in refrigeration equipment and A/C sectors, ODS destruction, the current absence of effective regulatory instruments and need to support ongoing institutional development and is aligned with Outcome 2 (a) - Belarus.

24 3.1 Component 1 - Regional accelerated phase-out capacity building (GEF financing US$ 295,001 (inclusive of regional PMC – US$ 45,000); National co-financing US$ 450,000) The component common across the four beneficiary countries consists of four sub-outcomes to clearly identify the institutional capacity building efforts through regional networking with non Art 5 and Art 5 countries. Activities are in full alignment with the PIF design. These are listed below and their details are provided in the table following this list. Given that activities above are interlinked with similar activities in the rest of participating countries in this regional project, it is expected to achieve savings in some of the budget items such as translation of materials (in case if materials are homogeneous in thematic focus and the language of translation is common) and further publication at one source. In this sense, it is planned to utilize the remaining resources at the end of the project more flexibly giving priority to the support of additional participation of NOUs in the network meetings. This component will ensure that Belarus will be able to meet its obligations under the Montreal Protocol with respect to accelerating the phase out of HCFCs.

3.1.1 Outcome 1a - Legislative and Policy Options for HCFC phase-out and control (US$ 55,556) The countries are provided with information resources and the necessary level of decision maker awareness to undertake national level updating of ODS legislation, regulations, licensing and reporting systems, economic instruments and qualification requirements necessary to ensure control of HCFC import and use consistent with phase-out obligations (inclusive of quota systems).

3.1.2 Outcome 1b - Capacity Building for Enforcement of HCFC control measures by customs and environmental/technical inspection authorities (US$ US$ 55,556) Russian language resource documentation and national trainers will be prepared for undertaking national working level training in Component 2 to equip customs and environmental/ technical inspection authorities in the enforcement of HCFC control measures related to import and application of HCFCs and HCFC containing equipment.

3.1.3 Outcome 1c - Capacity Building for the Refrigeration Sector, Incorporation of Energy- Efficiency and GHG reduction elements (US$ 111,111) User awareness tools, training modules and national trainers delivered for undertaking national working level training in Component 2 refrigeration technicians related to HCFCs and alternatives, taking Energy efficiency and GHG reductions into consideration, and enhancing the sustainability of such training by embedding it in national institutions

3.1.4 Outcome 1d - Support for the development of regional institutions, capacity, and cooperation (US$ 27,778) Regional cooperation, information exchange, and joint initiatives in areas of collective interest and concern, namely:  Development of a regional network of RAC associations;  Data collection and regional planning for ODS destruction;  Development of robust Prior Informed Consent (PIC) mechanisms across the region;  Ongoing and expanded participation of non-Article 5 countries in the ECA regional network.

25 3.1.5 Overview Component 1 - Regional accelerated phase-out capacity building

Outcome/Output Description Budget (US$) Outcome 1(a) - Legislative and Policy Options for HCFC phase-out and control 55,556 Output 1a.1 Preparation of The materials will be prepared for use by NOUs, customs authorities and other stakeholder government 10,000 Russian language resource agencies on the legislative and regulatory actions required for HCFC phase-out (i.e. step down quotas, materials bans, single use and container size restrictions, prior informed consent measures, proof of origin documentation, certification systems for technicians, and fiscal instruments to promote price equalization). In addition an assessment of the different modalities for ensuring the rapid and effective incorporation of HCFC phase-out elements and HFC monitoring in national ODS licensing mechanisms and associated regulations will be undertaken for each country. Output 1a.2 Training sessions for national decision-makers and NOUs respecting legislative and regulatory actions 14,556 Awareness training on legislative required for HCFC phase-out will be carried out in each of the four countries once yearly. An and regulatory actions environmental expert (International Consultant) will be requested to prepare the required materials to be delivered during an intensive training seminar. The costs associated cover fees, travel and home based work for international expertise and costs associated with local organization of the workshops. Output 1a.3 Regional networking between countries on implementation experience, consistency and cross border 31,000 Regional networking impacts related to HCFC control measures. Outcome 1b - Capacity Building for Enforcement of HCFC control measures by customs and 55,556 environmental/technical inspection authorities Output 1b.1 Russian language resource documentation and national trainers will be prepared and delivered for 10,000 Russian language resource undertaking national working level training in Component 2 to equip customs and environmental/ documentation and Training of technical inspection authorities in the enforcement of HCFC control measures related to import and National Trainer application of HCFCs and HCFC containing equipment. Output 1b.2 These will take place at the management level of enforcement authorities on CFC entry-point control 15,000 Awareness raising activities measures, major enforcement issues involved (packaging, labeling, identification, container sizes) and collectively identify the detailed scope, trainee numbers and supporting equipment requirements for Component 2. Output 1b.3 This activity aims to establish national cadres of trainers via ”TOT” training of customs and 10,000 Training of Trainers environmental authority decision-making staff to enforce the HCFC control measures related to import/export, distribution, and application of HCFCs and HCFC containing equipment. Output 1b.4 Technical support for comprehensive PIC network for ODS import/transit/export in the region linked 5,556 PIC Network bilaterally with major producing countries. Output 1b.5 Networking will be implemented through exchanges between countries on implementation experience, 15,000 Regional networking consistency and cross border impacts related to import/export issues and related enforcement. It is expected that one cross fertilization workshop will take place per year which will allow for all participants to learn from successes and challenges in order to facilitate

26 Outcome 1c - Capacity Building for the Refrigeration Sector, Incorporation of Energy-Efficiency and GHG reduction 111,111 elements Output 1c.1 Preparation of Preparation (and publishing and/or procuring ready sufficient number of copies in Russian) of these 85,000 Russian language training materials will take place in support of targeted national awareness on HCFCs and energy efficiency for manuals and information leaders in the refrigeration sector (major users and service sector association representatives), NOUs and materials agencies responsible for certification on: (i) Addressing long-term HCFC demand, and benefits of energy-efficient retrofit/replacement and the use of ‘natural’, low GHG refrigerants; (ii) Identifying the scope, trainee numbers and supporting equipment requirements for national level training for technicians in Component 2; (iii) Strengthening of Refrigeration Associations; (iv) Enhanced certification of service organizations and technicians; and (v) Sustainable mechanisms for future training. Output 1c.2 Enhanced general best practices “TOT” training at the regional level for selected principal staff from 26,111 ToT on Best Refrigeration technical universities and training centers involved in educational programmes for refrigeration Practices technicians to incorporate handling of HCFCs, promotion of ‘natural’/low GHG alternatives, energy efficiency aspects etc, with commensurate updating of national certification training curricula. Outcome 1d - Support for the development of regional institutions, capacity, and cooperation 27,778 Output 1d.1 These will be prepared on RAC technical issues, PIC, ODS destruction and other subjects of collective 5,000 Preparation of Russian language interest. information materials Output 1d.2 These will be actively promoted between RAC associations (i.e. web site, workshops, 2,778 Promotion of Information training/certification practice) and with major international networks and resources (i.e. IIR, AREA, exchange mechanisms ASHRA). Output 1.d3:Facilitation of This will focus in particular on and plans for ODS destruction including requirements for capture and 20,000 regional dialogue secure storage and linkages to general chemicals waste management (specifically POPs/chemicals disposal) in the region. Project Management for regional component 45,000 GEF financing of this component will be directed to international experience inputs as required, contractual services for compilation and translation of the documents as requested by the country, publication of materials in local language and facilitation of regional dialogues and networking with partner countries (including attendance of CAP assisted networks and sub-regional meetings).

National co-financing will be provided through staff and coordination logistics related cost contributions (for example when/if the country plays the role of a host country for any of thematic sub-meetings for the rest of participating non Art 2 countries) from principal institutional stakeholders in the government (Ministry of Natural Resources and Customs) involved in regulatory and import control of ODS, as well as from higher education institutions which will be responsible for technician trainings in the country in long term.

27 The following section details work to be undertaken under Component 2 and has been numbered as per the approved PIF which alphabetically assigned Component 2(a) to Belarus, Component 2(b) to Tajikistan, Component 2(c) to Ukraine and, finally, Component 2(d) to Uzbekistan.

3.2 Component 2a - HPMP, National Level Capacity Strengthening and HCFC Phase-Out Investment (GEF finance – US$ 1,965,000; National co-finance – US$ 6,115,000)

This Component constitutes the major component of the project for Belarus and it is directed to achieve the following goals:

 A finalized and adopted HPMP based on an accelerated phase-out strategy;  Implementation of national level training for the servicing sector and customs/enforcement authorities; and  Targeted HCFC phase out investment demonstrations projects/pilots undertaken in priority areas as described below

It is fully aligned with Outcome 2a and is further expanded based on work undertaken during PPG phase and related to detailed discussion with national level project partners.

The Component 2 will result:  Modernization of the technological processes of industrial plants in the refrigeration and transport sectors to insure that the plants’ products can enter international markets.  Register of refrigeration equipment, conditioning systems and technological processes using HCFCs.  ODS-free and energy efficient refrigeration equipment widely used in the agricultural, transport, industrial, trading and other sectors; capacity built to distribute, collect and regenerate HCFCs for their further use.  Improved service of refrigerating equipment resulted in decrease in the HCFC use and import in Belarus, increase in HCFCs reuse.  Reduced pollutant emission from Belarusian plants in the atmosphere.

3.2.1 Output 2a.1: Implementation of the approved formal HCFC Phase-out strategy and action plan

During the previously completed regional MSP project on developing the outlines of HCFC phase-out strategies for several non Art 5 countries in the region, GEF/UNDP assisted Belarus with the HCFC data collection and formulation of an advanced draft of the HCFC Action Plan. The adoption of the HCFC strategy and its follow-up implementation will depend on organization of final strategy consultation and awareness raising workshop(s) which will ensure cross-participation of various involved line Ministries and other important stakeholders who are considered to be directly or indirectly be affected by HCFC phase-out measures.

Amongst the actions considered in the approved HCFC phase-out strategy are the strengthening of the capacities of Customs and environmental enforcement officials, and refrigeration technicians via

28 training (training of trainers) and equipment/tools supply, as well as specific investment activities and demonstration projects. An important place in the strategy will be taken by practical introduction of certain provision of EU F-gas regulation (also in light of currently accumulated experience in its application) as it is equally applicable to HCFC handling in the servicing sector, and then with further extension to HFCs which are considered to come as main replacement for HCFCs in this important economic sector. These modern time requirements will be backed for implementation through the adoption of the HCFC phase-out strategy.

With the full deployment of the activities contemplated in this strategy, the country expects to have an integral control system for HCFCs and ODS in general, monitoring the substances from import authorization and through sale, distribution, handling, storage, treatment and recycling, among other stages. A registry of refrigeration equipment, conditioning systems and technological processes using HCFCs that would allow the in situ monitoring of the management and handling of these substances will complement the control system, as well as a certification scheme for technicians developed on the basis current EU systems with appropriate adjustment to local conditions.

The main activities under this output will serve to facilitate information exchange platform (workshop) for the main line-ministries and their relevant staff and will support endorsement of a finalized HPMP, based on the accelerated phase out strategy. This will include finalization of the strategy with updated information, translation of materials and support costs to ensure the full participation of stakeholders.

The cost estimate for this activity is provided below.

US$ GEF Co-Financing Total Cost estimate for Output 15,000 50,000 65,000

GEF financing will provide assistance for national level to support the implementation of the approved strategy on HCFCs, which will include information such as:

(-) latest HCFC consumption trends, (-) inputs from the regional component on final legislative options to control HCFCs import and use (HCFC equipment import quotas, improvement of inter-departmental cooperation on HCFC control between NOU and Customs, update of Customs codes etc), (-) results of regional cooperation on thematic areas (such as illegal trade, mislabeling of gas canisters, ODS destruction etc),

GEF finance will support translation of the documentation into local language and wider stakeholder discussions on adopting the strategy in terms of draft legislation for formal approval by the Government.

National co-financing will be based on the Governmental support to the implementation of the HCFC phase out strategy through allocation of legal personnel to draft required legislation and detailed consultations at line-Ministries’ level as well as defense of the legislation at the decision-making level of authority (Cabinet of Ministers, Parliament). Overall institutional coordination role of the Government is provided to support this output.

29 3.2.2 Output 2a.2: Trained working level Customs and enforcement officials, and refrigeration technicians (using resources (trainers and training materials) from Component 1 with respect to legislation, regulations, customs controls, refrigeration servicing techniques, and general best practices)

The draft HCFC phase-out strategy specifies the need for additional HCFC management capacity building in Belarus. Apart from filling in gaps in HCFC import control and re-use capabilities, an essential element for HCFC control in the servicing sector is considered to be the type of instrument that is contemplated by existing EU’s F-gas regulation. This regulation, though aimed at HFCs in the first place, provides a good foundation with comprehensive requirements for refrigerants handling with the main purpose of accurate reporting on the consumption and reducing emissions. These important aspects will form a part of comprehensive capacity building in the country for more effective control of HCFC use.

In order to improve HCFC import and use control capabilities for Customs, environment enforcement officials and refrigeration technicians, the national component will, based on the directions set by the strategy and inter-regional consultations held in the regional capacity strengthening component, provide for trainer-to-audience workshops and tools (both analytical and servicing) supply in support of the practical implementation of such hands-on trainings. This will be done using resources (trainers and training materials) from Component 1 with respect to HCFC import and management control legislation and regulations (HCFC and HCFC equipment import quota system, HCFC use and registration controls at end-user level, safety standards for alternative technologies, equipment logbooks), refrigeration equipment servicing techniques (certification of technicians, equipment repair/maintenance standards, R/R/R equipment requirements), and general best equipment servicing practices. In-country training capability for involved audience will be established and further strengthened where necessary with update of training programs will be updated.

The cost estimate for the proposed GEF support is presented in the summary table below. Each of sub- items is discussed in the following sections.

US$ GEF Co-Financing Total Cost estimate for Output 2a.2 588,200 1,400,000 1,988,200 Customs and enforcement 151,500 400,000 551,500 officials Technicians 436,700 1,000,000 1,436,700

Details by sub-component and associated breakdown budgets are provided in sections below.

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3.2.2.1 Customs and environmental control officials training and equipment support to enhance Customs control capability

US$ GEF Co-Financing Total Cost estimate for Output Customs and enforcement 151,500 400,000 551,500 officials

30 Training 23,000 Equipment 118,500 TA (nat/int) 10,000

The HCFC Phase Out strategy preparatory work and the PPG’s FSP formulation activities revealed gaps in the current capacity at the Customs and environment enforcement levels. For the latter group, the HCFC use control function becomes considerably more important in the view of HCFC import control limitations. These relate to:

 lack of regular training of Customs and environment enforcement officers on new developments in the area of HCFC and HCFC-based equipment import and use control measures/procedures for packaging and equipment checks at the border (and installed) which deteriorates the national level capacity to implement new coming legislation in support of the accelerated HCFCs phase-out;  outdated information and training materials;  lack of equipped training classes in support of improving officer qualifications; and  outdated/out-of-order CFC/HCFC and lack of HFC portable analytical equipment

In order to fill in the identified gaps that prevent from effective implementation of Customs’ function to control the import of HCFCs, PPG team had detailed discussions with the Customs office and agreed on the following assistance package.

For Customs, fifteen (15) advanced refrigerant identifiers will be provided for use at the principal points of entry (at borders not related to Russia such as Ukraine where illegal imports are suspected to take place), as well as an additional identifier for use in the Customs Training Institute for hands-on training for the Customs border officers. This would also improve the capacity of Customs to support implementation of Green Customs initiative as related to the Montreal Protocol’s objectives.

Ten (10) more identifiers will be supplied to regional (territorial) Environmental Inspectorates, inclusive of central authorities and inspectors training facility located at the Ministry of Natural Resources (Ministry of Environment educational centre), for monitoring of HCFCs on the domestic market in support of application of prototype F-gas regulation’s requirements to HCFC handling and use (with follow-on extension of the system to HFCs which is currently considered to become the principal resource of refrigerants in line with EU experience). The supply of this equipment will be supported by some spares such as a limited number of back-up accumulators, filters, connecting hoses, sampling tips, piecing pliers in sufficient quantities so as to ensure their successful and continued use for the duration of the project.

In order to support the sustained trainings of environmental inspectors and Customs officers, two (2) complete sets of training equipment (gas cylinders for practice, LCD and laptop) will be supplied to the MNR and Customs Training Institutes to equip two (2) dedicated classrooms. This will fit well regular trainings of new staff, as well as serve for regular updating of previously trained ones. The implementing partners have committed to allocate such a space in the Institutes, equip them with required furniture for trainings, and also to ensure that a new study curricula be developed and adopted in each Institute (in coordination with the Ministry of Education) to continue with essential personnel training, even in the time beyond the project duration. The Training Institutes will allocate trainers,

31 and in combination with established training curriculum, this will make any future training of enforcement officers more sustainable as compared to one-time trainings, which prevailed in the past.

The training component will feature three important elements:

 Training-of-trainers by international Customs specialist (both for environmental inspectors and Customs officers);  Immediate training (by trainers) for up to 40 working level environmental inspectors (10) and Customs officers (30) who operate in main territorial Environment and Customs departments and main posts affiliated with those offices;  Regular training of staff by the Training Institutes (mandatory for all new staff and regular qualification of existing staff).

The training sessions will be from 3 to 5 days long to ensure quality delivery and practical experience with use of all materials, tools and equipment.

The equipment supply will be preceded by the initial TOT trainings for 2 – to - 5 trainers (two of which will come from the MNR and Customs training institutes) as supported by the regional Component. A number of workshops then (five) will be supported by the project in order to deploy the trained personnel to the regions and train personnel in each province.

This will be supported using resources (trainers and training materials) from Component 1 with respect to HCFC import and end-use control legislation and regulations, Customs controls on illegal trade and mislabeling, and general information for environmental inspectors on general best-practice standards in servicing HCFC equipment and handling HCFC stocks (similar to F-Gas regulation’s requirements).

GEF financing will provide assistance for capacity building and technical assistance to the MNR and Customs Departments (and their dedicated Training Institutes) to enhance the training of enforcement officers, equip the departments with required tools to effectively implement HCFC import and end-use controls.

National co-financing will focus on allocating classrooms in the Training Institutes (and utility fees), the inter-departmental coordination for adoption of an updated training curriculum, providing trainers from the Training Institutes and their salaries during and beyond the project duration for the sustainable training of enforcement officers after the project’s closure, additional investment co- finance on improving general incoming goods scanning capacity (through parallel Customs modernization programs on establishing scanners for selective identification of goods imported in bulk – in trucks - which may contain HCFC cylinders and equipment), and allocating of a warehouse to be specifically dedicated to ODS materials/equipment. The MNR and Customs Departments will engage into inter-departmental coordination work on the implementation of HCFC Phase Out strategy.

32 3.2.2.2 Refrigeration technicians training and equipment support to enhance refrigeration- servicing practices

US$ GEF Co-Financing Total Cost estimate for Output Technicians 436,700 700,000 1,136,700 Training 80,000 Equipment 326,700 TA (nat/int) 30,000

The project will support the continued training and equipment supply (tools and equipment kits) for technicians (also those working for service centers) and ensure the sustainability of future trainings of refrigeration mechanics. The programme will be closely tied to developing regulations by the Belarusian side on application of EU-prototype HCFC/HFC handling requirements (for instance, F- Gas directive). Appropriate certification and licensing will form an integral part of this component.

A network of current training centers (technical universities, vocational schools and a training center of MNREP) will be deployed for this purpose. Apart from the training center at the Ministry of Natural Resources, the following higher level and vocational type of education institutions are currently active in the country:

 Minsk National Technical University;  Mogilev State University of Food Technologies;  Polotsk Trade Technological College;  Pinsk State College of Meat and Dairy Industry.

The listed training centers will receive a set of modern teaching equipment (laptop with software, LCD projector and white screen). Standard servicing tools for hands-on training will be provided too. Representatives of the institutions will participate in the train-the-trainers component proposed in Component 1.

The training modules will be designed with help of the Association and the trainings will be delivered with practical field trips to functional service centers for hands-on experience. Upon completion of trainings, the Association will issue certificates to endorse qualification of technicians, and on the basis of such confirmations MNREP will then print an official work license, which will include provision of a minimal tool kit and a training certificate.

It is expected that with the above, 800 technicians in Minsk and other regions will be trained. The duration of the trainings will be from 3 to 4 days.

Finally, there are currently an estimated number of four (4) operational service centers in Belarus, which employ from 30 to 50 technicians (and above in some cases) each. These service centers, along with the identified training institutions and Refrigeration Association, will provide support in training their staff or allocating available classrooms in distant regions for the specialized trainings delivered by trainers.

33 In total it is expected that around 150 kits will be procured for distribution to technicians and these will include a set of basic tools (manifold and hoses, piercing pliers, tube benders, leak detector, thermometer, voltmeter, etc.) as well as equipment (portable recovery unit, leak detector, portable recycling kit, reusable recovery cylinder, etc.) in support of best refrigeration practices.

GEF financing will support trainings, national expertise for the implementation of train-the-trainer element of the project and monitoring of basic equipment use by individual technicians and technical centers. Further, the support will cover the supply basic tools for refrigeration servicing sector, upgrade of one classroom at the Training Institute, strengthening of the Refrigeration Association and update of the training curriculum for technicians.

National co-financing will be attached to the GEF support in terms of allocation of training rooms (staff time, furniture, coordination of trainings, utility fees) at the Training Institute and technical centers. The trainings of technicians will be supported beyond the project duration to ensure sustainability of results on a self-sustained basis. Technical service centers will co-finance the project by supporting complementary equipment (basic tools) purchase, maintenance and operational costs for the tools and equipment (inclusive spare parts), and self-training of their staff beyond the project duration on recovery/best practices in preparing refrigerated equipment – the training will involve the cost of technician certification during the project and beyond. Some of technical centers will serve as model centers for improving hands-on experience of technicians in training to demonstrate best refrigeration practices and HCFC re-use scheme.

3.2.3 Output 2a3 – Targeted Phase-Out Investment and Pilot Projects

Another principal component of the project is the investment programme that was developed in support of:

 The phase-out the use of HCFC-141b at MAZ Kupava enterprise used in the manufacture of commercial trailers, vehicles, tourism vehicles and insulated trailers;  The elimination of the use HCFC-141b at Atlant (David-Gorodok Electromechanical Plant) as a solvent in assembling/manufacturing processes;  The updated and expanded HCFC Recycling and Reclaim (HCFC re-use scheme) capacity at the level of larger equipment service centers and Refrigeration Association;  The unwanted ODS Pilot Destruction Project; and  Demonstration of natural cooling technologies for milk coolers and refrigerated equipment sectors.

This Output will result in a foam conversion project with transition from HCFC-141b to c-pentane, the elimination of HCFC-141b in parts cleaning solvent applications with alternative chemical-based methods, and to the improvement of the HCFC re-use system through supply of modern Recycling and Reclaim equipment which is critically important at a stage when HCFC supplies will be more and more limited. It will additionally demonstrate possibilities and benefits of HCFC equipment retrofit/replacement in the refrigeration (commercial/agricultural) sector to disseminate information on

34 opportunities to reduce dependence on the HCFCs in longer term and will overall show linkages to climate change focal area in terms of achieving better energy-efficiency of new system set-ups on a limited basis. The project will also help demonstrate the full life-cycle management of HCFCs through pilot unwanted ODS destruction in its geographic location.

The cost estimate for the proposed GEF support is presented in the summary table below. Each of the sub-items is discussed in the following sections.

US$ GEF Co-Financing Total Cost estimate for Output 2a.3 1,361,800 4,965,000 6,326,800 Implementation of a foam conversion project at MAZ Kupava 547,800 2,715,000 3,262,800 Implementation of a solvent conversion project at 176,000 700,000 876,000 David Gorodok Electromechanical Plant Demonstration of refrigeration equipment replacement 260,000 300,000 560,000 with alternative low GWP technologies Upgrades of HCFC re-use system 181,000 850,000 1,031,000 Unwanted ODS destruction Pilot project 197,000 400,000 597,000

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3.2.3.1 PU Foam conversion project: The phase-out the use of HCFC-141b at MAZ Kupava

The objective of this investment sub-project project is to phase-out the use of HCFC-141b mixed in polyols in the manufacture of commercial trailers, vehicles, tourism vehicles and insulated trailers at MAZ Kupava enterprise.

Automobile trailers and bodies plant “MAZ-Kupava” Ltd (MAZ Kupava) was founded in 1990. The company is 100% locally owned and is the only PU foam manufacturing company operational in Belarus. The enterprise started the production of traveler trailers in 1990 with Slovenian design technology. Presently, MAZ Kupava manufactures more than 100 models and modifications of trailers and vans.

Its annual PU foam production capacity is 550 tons. In 2009 and 2010, the foam production was 338 tons and 392 tons respectively, which consumed 55.8 tons and 56.1 tons of HCFC-141b respectively. The company is economically stable, has prospects of development and is ready to take part and co- finance the project on HCFC phasing out. The company plans to increase its production volume by to 2-3 times in coming years.

The project has been designed for the enterprise to replace the current use of HCFC-141b with c- pentane technology with very low GWP characteristics. The total investment from the GEF is expected to be US$ 540,780. The layout of the project is presented in Annex 4 to this document, which has been prepared in line with applicable ExCom funding threshold standards.

GEF finance will cover standard technology replacement costs (capital) and technical assistance for the implementation of the project and for covering technical expertise provided for preparation of design

35 documentation, installation and tuning up of new equipment, along with training of the MAZ-Kupava staff on new equipment operation and adherence to the explosion and fire safety standards in the process of cyclopentene use. International consultants will also provide expert support to preparation of tender documentations for new equipment procuring.

National co-finance will address local engineering works to prepare the enterprise for the new flammable technology: modifications of presses and assembly tables, electric grounding, anti-static flooring, exhaust ventilation system and back-up electricity supply system. Further, the enterprise will cover the costs of civil works (local clearances, land excavation, soil transportation, establishment of pentane storages, ducting for polyol supply, steel/mineral wool insulation, ventilation enclosures, and building modifications). It will invest in regular training of personnel in equipment use and safety procedures; monitoring of equipment performance and maintenance/repairs as required, PR campaigns on the use of ozone- and climate friendly technology in products after the conversion.

US$ GEF Co-Financing Total Cost estimate for Output Implementation of a foam conversion project at 547,800 2,715,000 3,262,800 MAZ Kupava

3.2.3.2 Solvents conversion project: Elimination of the use HCFC-141b at Atlant (David-Gorodok Electromechanical Plant) as a solvent in assembling/manufacturing processes

The objective of this project is to eliminate the use of 7.33 T HCFC-141b in assembling/manufacturing processes at the David-Gorodok Electromechanical Plant manufacturing protection relay parts for the household fridge manufacturing plant “Atlant” (through its machine building branch at Baranovichi plant).

The application of HCFC-141b at the Atlant factory for degreasing of metal parts and compressors spares and inlets started with the purchase of used machinery in 1995. After 10 years operation with the equipment installed at Atlant in the capital city and due to emissive use of HCFC-141b, it was decided to relocate the operations to Atlant’s branch called Baranovichi machine-building factory in 2007 (western part of the country). This factory then in line with the Government programme to support the development of small towns and industries has leased the equipment out to a sub- contractor plant in David-Gorodok town – David-Gorodok Electromechanical Plant. The equipment was handed over on the conditions of lease, and the owner has been kept to be the Baranovichi machine-building factory – a branch of Atlant starting from 2005. The company is economically stable, has prospects of development and is ready to take part and cofinance the project on HCFC phasing out.

The ODS consumption in solvents sector (at the factory) constituted 3.98 metric tons of HCFC 141b in 2008 with an ODP value of 0.0438 tons. In 2009, this was already 6.81 metric tons with an ODP value of 0.749 tons and for 2010 it was 7.33 metric tons of HCFC 141b with an ODP value of 0.806 tons. The 2011 (projection) is 8.24 metric tons of HCFC 141b with an ODP value of 0.906 tons.

36 Replacement of HCFC-141b is planned with alternative chemical of a trans-blend group (see Annex 5). The project will be accomplished by (1) replacing the current cleaning methods with vapor degreasing units of closed cycle (to substantially minimize volatile emissions of newly selected solutions), with recycling capability and (2) using an alternative solvent. Annex 5 contains a separate project document for this project sub-component.

Given the scale of assistance to the company it is considered as a cost effective measure in line with the expressed company plans to expand and improve its industrial safety practices. The company is in the process of investing in expansion of its infrastructure to increase production processes.

GEF finance will support the procurement of closed-cycle vapour degreasing equipment for the company along with the technical advice on the use of new equipment and safety standards. It will also be used for covering technical expertise provided for preparation of design documentation, installation and tuning up of new equipment, along with training of the David-Gorodok Electromechanical Plant staff on new equipment operation and application of alternative solvents. International consultants will also provide expert support to preparation of tender documentations for new equipment procuring.

National co-financing (Atlant and Baranovichi) will relate to the local engineering works to prepare platforms for the new equipment, introduce safety standards (with procurement of PPE), install double-stage ventilation systems and area access signs, cover utility fees, maintain the equipment by adequate use and procurement of spare parts and constantly train staff on the safe use of this equipment. Operating expenses will be covered by the company.

US$ GEF Co-Financing Total Cost estimate for Output Implementation of a solvent conversion project at 176,000 700,000 876,000 Atlant/David Gorodok Electromechanical Plant

3.2.3.3 Demonstration of natural cooling technologies for milk coolers and refrigerated equipment sectors

HCFC consumption in agricultural and processing industry sub-sector in 2009 constituted 30% of HCFC-22 and blends of total demand for HCFCs in the country. This is the important sector of economy of the country as it is considered as important milk product producer in the region. The project therefore will aim at demonstrating alternative – primarily, natural cooling – technologies in this sector as larger in size equipment has been historically involved. Additional sectors for consideration are A/C or refrigerated equipment dependent sectors (buildings and facilities) where alternative non-ODS/low-GWP technologies could be demonstrated and promoted in order to maximize the capital, operational costs, performance and energy savings where those can be achieved and proved.

In particular, such demo projects could include CO2 - NH3 - HFC - HC based refrigerated packages through supply of new equipment or retrofit of applications in existing systems, where technically feasible. Apart from technological and energy-saving improvements, this component will directly

37 serve to increase the capacity of the equipment assembling, nationally based companies (who are also equipment servicing centers) to handle new technologies in the country.

A first selection process (through UNDP tender procedures) will be carried out to identify companies that can design, assemble and provide the necessary technical support to ensure the maintained operation of the new systems developed around centralized unit clusters. A second tender process to select the recipient enterprises will be carried out and will include conditions that recipients finance technology design, local engineering works, installation and maintenance, while the project will provide new equipment operating on alternative technologies. National expertise (collection of technology related data, support to IC, monitoring of equipment use and performance, report 1yr/part time), as well as international TA, trials, testing and audit & reporting will all be included in the project.

Demonstrations will be carried out on refrigeration systems and these will be replicated in similar or equivalent units such as A/Cs.

Illustrative manuals for training sessions (combined with technician training components and field trips) will be produced in national language. This will demonstrate new approaches to wider community of technicians and demonstrate proper installation/use and maintenance of such equipment and technologies in support of improved maintenance practices and standards.

Reporting on achieved results to highlight benefits and disadvantages and these pilot demonstration projects will be widely disseminated in workshop and publications and will include the results of close monitoring of the energy efficiencies obtained. In order to ensure this result, data loggers will be supplied to maintain a proper/verifiable registry of energy consumption.

GEF financing will be designed to cover the procurement costs of refrigerated equipment packages designed to work with CO2 - NH3 – HC (natural refrigerants), in some cases, geared towards two- stage refrigeration systems with the use of HFCs – this is the case of CO2 systems, along with covering technical expertise provided for preparation of design documentation, installation and tuning up of new equipment, along with training of the respective organizations staff on new equipment operation. International consultants will also provide expert support to preparation of tender documentations for new equipment procuring. It will further support national/international expertise to help with monitoring of equipment performance and safety audits, and a workshop to disseminate the results of the demonstration project.

National co-finance will involve local level support by the recipients of such equipment which will involve allocation of commercial/public areas to accommodate new technologies, technology design costs, all local engineering works in support of the project’s objectives, installation of equipment and maintenance costs to ensure effective use of the new technology during the project and beyond. Selected recipients of equipment will ensure required performance data reporting to the Government and provide staff for the coordination of all works.

38 US$ GEF Co-Financing Total Cost estimate for Output Demonstration of refrigeration equipment 260,000 300,000 560,000 replacement with alternative low GWP technologies Equipment 210,000 TA (nat/int) 40,000 Regional workshop 10,000

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3.2.3.4 Upgrade of HCFC re-use system through strengthening R/R/R centers and improving local distribution of bulk HCFC/HFCs in support of container import regulations

Given that refrigeration servicing remains the dominant application of HCFC technology, the country’s overall capacity in refrigerant management needs to be maintained and strengthened to ensure recovery and recycling is maximized, capacity for alternative technologies exists, and ultimately management of “end of life” refrigerants is provided for. It is understood from previous experience that it is at this point in time that such a system, coupled with market forces (the country, as compared to Art 5 countries in the region, slowly approaches final stages of eliminating import and consumption of HCFCs), demonstrates its full potential and in general results in substantial HCFC re- use rates.

The idea behind the strategy developed under this component is not to focus simply on recovery/recycling but to develop an integrated approach that encompasses the full life cycle of refrigerants in general for the country - from transfer of bulk containers into smaller use ones, all the way to destruction (see next section, below) with a network of recycling centers in support of it. The establishment of such system will also support the previous component on technician training, certification and tooling as well will serve to complete the establishment of HCFC/HFC re-use scheme in the country.

There are current limitations in technical capability and modern equipment to support effective management of HCFCs used in servicing and this project proposes the strengthening of four (4) existing recovery and recycling (R&R) and service centers, and establishing one new (1) regeneration (reclaim)/storage and destruction facility for ODS based gases used in refrigeration and air conditioning. With the future coming import limitations for HCFCs, the gas recycling and re-use scheme is in high demand as it was noted during the field survey of service centers. Therefore, the GEF assistance will be geared towards modernization of identified technical centers which deal with installation, maintenance and repairs of ODS based refrigeration equipment.

It should be noted that partial assistance to such centers in terms of basic gas recovery machines and servicing tools will come from the previously described component of tools supply for refrigeration technicians. Such tools will be distributed to mobile servicing brigades and as stationary tools to the centers.

39 The following two (2) primary Recycling centers and two (2) smaller sized technical service centers will be strengthened and will receive HCFC re-use equipment11:

 Holodon (recycling function)  Laminar (recycling function)  AgroPromHolod (advanced recovery equipment with recycling element)  HladAgent (advanced recovery equipment with recycling element)

A reclaim center (with GC and related equipment such as moisture meter) will be established, and it will demonstrate a model approach for integrated ODS management. Being the most expensive and sophisticated set of equipment, this center will be tendered out to a qualified servicing company with substantial record of activities in such area of work and will be combined with the following section on deploying a small-scale ODS destruction unit. This practical demonstration will help establish best practices on the full life-cycle management of ODS chemicals.

The Recovery/Recycling (service centers) and Reclaim Center(s) are expected to assist in meeting the demands of recycled and reclaimed refrigerants and is such a way to help facilitate the successful phase-out and as such to cover the end of HCFC phase-out in Belarus. Furthermore, these centers will be adequately equipped to assist with the HCFC based equipment retrofit/replacements to improve practical skills and experience and promote themselves as centers of excellence to backstop any future equipment retrofits in the time beyond the project’s duration.

As one of the important parts of country’s HCFC phase-out strategy is related to the ban on single-use HCFC containers, and import HCFC in bulk multi-use containers, it will be imperative to supply two (2) HCFC-22 re-filling lines (on a tender basis) for gas importers and distributors in order to allow the establishment of HCFC re-use system in the country in its full strength. This measure would promote a more centralized distribution system that would be easier to monitor and control. It would also foster more value added activity in the country by local filling, something that would also require some local infrastructure development. This approach will also facilitate penetration of reusable containers into the market, as well as eventually allow local importers to recondition large cylinders (13.6 kg and more) that they might import, into smaller sized canisters, in accordance with the needs of the market at any given time.

Overall, this project aims to strengthen the existing HCFC management capacities, and to build necessary future capacity, in order to ensure the country has the required tools and equipment to reduce its dependence on HCFC imports.

GEF financing will support the establishment of such R/R/R infrastructure across the country and implementation support through deployment of a part-time national expert to help monitor the equipment distribution and use, and one short-term international expert for development of the HCFC re-use system and procurement of specialized equipment.

11 Additionally, a refrigerated train depot of Minsk and Molodecheno will be considered for assistance during project implementation

40 National co-financing will be geared towards allocation of protected facilities by each of the participating service centers to place the R/R/R equipment and re-filling stations, utility charges, equipment maintenance, and staff costs to operate it. The centers will be planning to procure required spare parts to keep the equipment operational for the longer term – beyond the project duration. Additionally, centers have committed to regularly train their staff on the adequate use of this sophisticated equipment. The main part of co-finance is also coming from the centers’ plans to complementarily equip their mobile equipment maintenance brigades with basic tools mentioned in the technicians training component - those who will not receive assistance from the GEF – approximately 50% of brigades will be equipped by the hosting centers. Companies will commit to procure additional larger size multi-use gas containers as required by the operation of HCFC re-use scheme and without additional assistance from the GEF. Technical centers will ensure that reports on R/R rates are compiled regularly by their staff and presented to the Government. US$ GEF Co-Financing Total Cost estimate for Output Upgrades of HCFC re-use system 181,000 850,000 1,031,000 Training (supplier as part of tender) 0 Equipment 161,000 TA (nat/int) 20,000

3.2.3.5 Destruction Pilot Project

In line with current Government rules, all enterprises dealing with ODS are obliged to ensure collection and disposal of ODS chemicals received during maintenance, repairs or de-commissioning of ODS based refrigerated equipment. However the enforcement of such regulations has proven to be challenging, as there is for example not yet a centralized storage facility established to accept and handle this and other types of waste ODS gases.

Although some progress has been achieved in the validation of a cold-plasma technology prototype hazardous waste destruction equipment, which is in place in a laboratory setting in the capital, this equipment is not suitable for certified destruction. Indeed, as its primary design and function has been for test/trials objectives, it has no residual emission controls and is not certified by the National Standardization Committee. Therefore, although results from the trials will be useful in determining the applicability of the technology, the existing equipment is not suitable for processing of unwanted ODS stocks.

The current estimates of the rate of unwanted ODS accumulation represent as a reported minimum of 0.5 MT/annually (as determined by MNREP and corroborated by experts based on data from selected service centers12). In addition, a particular problematic is represented by the very large number of discarded “empty” single-use cylinders still containing fractions of refrigerants and/or blends. In some cases, depending on the quality of the recovery equipment or transfer pumps, this can represent from 0.15 to 0.30 Kg (150 to 300g) per cylinder, and although a final tally is not as of yet available, it was reported that one importer had a stock of close to 5,000 “empty” cylinders awaiting disposal. Sixty (60) percent of the stock is represented by remaining fractions of HFCs and blends, and forty (40) percent – by HCFCs (30%) and blends (10%).

12 Initial survey data indicated presence of 0.8 MT of C10M1 mxture

41 At present the baseline scenario is no or limited action, and/or lack of enforceability of the Government norms and in this perspective, the government is convinced that with renewed enforcement of regulations on HCFC use licensing (and also that of the previously mentioned regulations), combined with the presence of ODS destruction capability in the country, the situation has the potential to dramatically change.

In addition it is expected that this RRRD (Recover, reuse, reclaim, destruction) capacity will further contribute to the strengthening and improvement of the HCFC re-use/recycle scheme. In addition it is expected that the facility will start receiving and storing amounts of obsolete/unusable HFCs, which could also be potentially destroyed13

The NOU has requested UNDP to plan for inclusion of a mobile plasma arc-type destruction pilot into this project and further to this, UNDP held initial exploratory discussions with the GEF and it was determined at that stage that a pilot project, whose experience and results could be shared regionally, and specifically as an initial demo approach within the Customs Union, could be explored. Given the mobility of the technology, if necessary this will be deployed to the different storage facilities throughout the regions, depending on need/costs. The government strongly believes that in situ destruction of contaminated/unusable ODS is a cost effective and replicable technology that must be tested.

Measures will be put in place to ensure that the operation of the machine complies with all the local environmental and health and safety standards and regulations. In particular regarding wastewater discharge, the plasma arc machine has been found to meet with local standards. This pilot will help to demonstrate how to further reduce the operation costs through economies of scale and by increasing labor and machine productivity through efficient management and minimization of down time.

There are approximately 3.47 kg of CaF2 & CaCl2 generated for every kg of CFC-12 or 2 kg of HCFC-22 destroyed. In a year, there are about 16.6 tons of CaF2 & CaCl2 generated if 4.8 t of CFC- 12 or 9.6 t HCFC-22 are destroyed from one plasma arc machine. As there is no market for these by- products, the CaF2 & CaCl2 could either be land-filled or mixed with concrete cement as is the practice, for instance, in Japan. One plasma arc machine could annually destroy 4,800 kg of CFC-12 or 9,600 kg of HCFC-22 over a 20-hour/day batch.

In future, a workshop to share results, in agreement with UNEPs DTIE could be organized in the context of one of the UNEP Regional network Meetings, which could be designed to focus on the subject of destruction.

GEF financing of this component will be directed to procurement of a mobile ODS destruction unit, spares for 1 year of operation, consultations at the stages of design documentation preparation and installation, technical assistance from a supplier of the technology to commission installation and monitor the performance. A regional workshop will be further arranged with GEF funds to report on the results in linkage to UNEP-CAP MLF sponsored ECA network meetings. International consultants will provide expert input to preparation of tender documentation for procuring the mobile unit.

13 EU F-Gases report estimates that facilities are “unable to reclaim about 1/3rd of HFC gases collected” see (EC) No 842/2006 Sept 2011 http://ec.europa.eu/clima/policies/f-gas/docs/2011_study_en.pdf

42 National co-finance will support the allocation of facility (on a tender basis) to host the ODS destruction center, staff and utility costs to operate it in longer term, also beyond the project duration. Furthermore, local facility design, engineering works and safety measures will be covered by national co-finance as well as EIA costs and coordination efforts within the Governmental structures. The government will also be responsible for utilization costs of resulting waste products and strict emission/release controls during the operation of the station. All staff will be trained to handle the equipment. Maintenance costs after the first year of operation will also represent national co-finance.

US$ GEF Co-Financing Total Cost estimate for Output Unwanted ODS destruction Pilot project 197,000 400,000 597,000 Equipment 155,000 TA (nat/int) 27,000 Regional workshop 15,000

3.3 Component 3 - Monitoring, learning, and adaptive feedback, outreach and evaluation (GEF US$ 35,000)

This component links to Outcome 3, namely that the project results are sustained and replicable with outputs being i) M&E and adaptive management applied to project in response to needs and extract lessons learned (Output 3.1) and ii) Lessons learned and best practices are replicated at the national level (Output 3.2). Details are provided in Part I Section H: Budgeted Monitoring and Evaluation plan.

= = =

43 The table below provides a summary cost estimate covering the proposed GEF scenario by Component and Sub- Component described above:

Cost (US$) Project Outcome Outputs GEF National Total

Component 1: Reducing the HCFC Servicing Demand - Regional Accelerated Phase-out Capacity Building

Output 1a.1: Preparation of Russian language resource materials Outcome 1a: Legislative and Policy Options for Output 1a.2: Awareness training on legislative and 55,556 HCFC phase-out and regulatory actions control Output 1a.3: Regional networking Output 1b.1: Russian language resource documentation and Training of National Trainer Outcome 1b: Capacity Building for Enforcement Output 1b.2: Awareness raising activities of HCFC control measures 55,556 by customs and Output 1b.3: Training of Trainers environmental/technical Output 1b.4: PIC Network inspection authorities Output 1b.5: Regional networking

Outcome 1c: Capacity Output 1c.1: Preparation of Russian language Building for the training manuals and information materials Refrigeration Sector, 111,111 Incorporation of Energy- Output 1c.2: ToT on Best Refrigeration Practices Efficiency and GHG reduction elements Output 1d.1: Preparation of Russian language Outcome 1d - Support for information materials the development of Output 1d.2: Promotion of Information exchange 27,778 regional institutions, mechanisms capacity, and cooperation Output 1d.3: Facilitation of regional dialogue

Project management for Regional component 45,000 Total for Regional Component 295,001 450,000 745,001

Component 2(a): National HPMP, National Level Capacity Strengthening and HCFC Phase-out Investment -Belarus

Output 2a.1: Formal HCFC Phase-out strategy and action plan developed and endorsed 15,000 50,000 65,000 Output 2a.2: Trained working level Customs and enforcement officials, and refrigeration technicians Outcome 2(a): Finalized using resources (trainers and training materials) and adopted HCFC phase- from Component 1 with respect to legislation, 588,200 1,100,000 1,688,200 out strategy and action regulations, customs controls, refrigeration plan, implementation of servicing techniques, and general best practices national level training for the servicing sector and Customs/environmental inspectors training customs/ enforcement and equipment support to enhance 151,500 400,000 551,500 authorities, and targeted enforcement control capability phase-out investment Refrigeration technicians training and demonstrations undertaken equipment support to enhance refrigeration 436,700 700,000 1,136,700 in priority areas servicing practices

44 Output 2a.3 - Targeted HCFC Phase-out 1,361,800 4,965,000 6,326,800 Investment Program and Demonstration projects Implementation of a foam conversion project at MAZ Kupava 547,800 2,715,000 3,262,800 Implementation of a solvent conversion project at Atlant/David Gorodok 176,000 700,000 876,000 Electromechanical Plant Demonstration of benefits of natural cooling in one or two sectors such as agricultural 260,000 300,000 560,000 milk coolers Upgrade of HCFC re-use system through strengthening R/R/R centers and improving local distribution of bulk HCFC/HFCs in 181,000 850,000 1,031,000 support of container import regulations

Pilot unwanted ODS Destruction Project 197,000 400,000 597,000 Sub-total 1,965,000 6,115,000 8,080,000 Component 3(a): Monitoring, learning, adaptive feedback, outreach and evaluation - Belarus Output 3.1: M&E and adaptive management applied to project in response to needs and extract lessons learned 35,000 0 35,000 Output 3.2: Lessons learned and best practices are replicated at the national level

Sub-total 35,000 0 35,000 Total for National Component (w/o PMC) 2,000,000 6,115,000 8,115,000 Project Management for National Component 200,000 330,000 530,000 Total for National Component (with PMC) 2,200,000 6,445,000 8,645,000 Project Management for Regional Component 45,000 Total PMC (regional and national) 245,000 Total Project Costs 2,495,001 6,895,000 9,390,001

45 3.4 Project Indicators, Risks and Assumptions

The project Indicators, Risks and Assumptions are fully represented in the Strategic Results Framework (Annex A) as well as the Risk Identification and Mitigation tables in corresponding GEF CEO Endorsement Document (Section G). It is suggested to refer to these indicated annexes and sections of the CEO endorsement document for details.

3.4.1 Incremental Reasoning and Incremental Cost Analysis

International institutional and capacity building assistance for Belarus on ODS phase out began as early as 1996 (as detailed in previous sections) and this was instrumental in addressing the CFC phase-out challenge and strengthening the institutional capacity of the country to coordinate the implementation of the Montreal Protocol.

However, it was not designed to prepare the country to address HCFC phase-out and as a result, there is a serious technical and institutional capacity gap. The initial effort related to latter group of ODS substances took the form of a regional MSP project to enable the collection of HCFC consumption data and prepare the outline of HCFC phase-out strategies to amend the existing, outdated Country Programme on the Implementation of the Montreal Protocol. The project started at the end of 2008 and was finalized for Belarus end of 2010. Specific assistance to prepare for HCFC phase out was provided under the regional GEF MSP with a national allocation of US$75,000 (both for UNDP and UNEP with UNDP funds almost fully disbursed) and by a follow-on preparations for a regional GEF Full Scale Project (FSP) entitled “Initial HCFC Phase Out Implementation in the CEIT Region”14 that was included in the GEF-4 pipeline.

The formulated HCFC strategy can be considered as a full-fledged strategy given the initial objectives of the MSP for Belarus were exceeded. The strategy sets clear directions for the country on how to effectively address the growth in HCFC consumption and relies on the technical assistance provided through the GEF, as no capacity building action has been taken to upgrade the existing CFC management potential of the country which has become redundant in the absence of CFC related challenges in the servicing sector. As such all GEF funding and associated co-financing is considered incremental. In the current project formulated in line with the HCFC phase-out strategy forming the Government’s action plan to eliminate dependence on HCFCs, GEF funds are to be directed to achieving project outcomes which meet the project environmental objective – avoided HCFC consumption and compliance reporting to the Montreal Protocol authorities - and which result in important global environmental benefits. In terms of the project’s design, the outcomes and the resultant global environmental benefits match with the GEF goals, objectives and strategic programs for the ODS Focal Area during GEF-4 as described previously.

In the absence of GEF assistance, it would not have been possible to leverage substantial co-finance resources in support of achieving HCFC phase-out in line with Montreal Protocol reduction milestones in 2015 and further preparing the country to sustain the phase-out beyond 2020. Further, the country would not be able to advance the HCFC phase-out to 2015 stage as planned by the Government by pioneering updated HCFC control approaches adopted in developed non-Art 5 countries and which effectively emulate those adopted in the EU.

It is acknowledged that there are national benefits from the project overall and from the GEF’s contribution, which both relate to enhanced institutional and technical capacity to be in position to address the country’s dependence on HCFC imports as well the pursuit of linkage to climate change mitigation benefits at the national level (through better energy efficient approaches) by primarily addressing HCFC (ODS) dependence challenge

14 http://www.gefonline.org/projectDetailsSQL.cfm?projID=4102

46 with an element of information dissemination in the regional/sub-regional contexts. These benefits also apply equally in a regional and global context.

Technical and regulatory strengthening financed by the GEF brings additional benefits related to the capacity and knowledge to improve the general environmental protection system as it functions as of now in the country. It will involve inter-departmental cooperation on solving complex environmental challenges such as sound chemical management.

The level of global environmental benefit in terms of reduction in and further elimination of import and consumption of HCFC would not occur in the absence of the GEF’s intervention as the HCFC phase-out Strategy will not be initiated for implementation and no technical assistance will be provided geared towards this strategy. Therefore, this programme is considered as incremental.

The Incremental Cost Matrix prepared in CEO endorsement document provides an overall summary of the incremental costs, both the GEF and co-financing estimated for the project, linked specifically to the project outcomes from Annex A of CEO Endorsement, the baseline, and global environmental benefits.

Country Ownership: Country Eligibility and Country Drivenness

Belarus is a signatory and/or Party to a wide range of international agreements and conventions related to the environment. The principal ones with some relation to ozone protection issues are listed below.

Convention/Agreement Signature Ratification/ Acceptance (at) / Accession (ac) Vienna Convention 22/03/1985 20/06/1986 (at) Montreal Protocol 22/01/1988 31/10/1998 – London Amendment to the Montreal Protocol n/a 07/01/1998 (ac) – Copenhagen Amendment to the Montreal Protocol n/a 18/12/2006 – Montreal Amendment to the Montreal Protocol n/a 18/12/2006 – Beijing Amendment to the Montreal Protocol n/a 18/12/2006

The overall legal framework applicable to protection of the environment in Belarus is provided in Constitution of the Republic of Belarus, the Law of the Republic of Belarus "On Environmental Protection" (November 26, 1992 as amended as of December 31, 2009), and the Law of the Republic of Belarus “On protection of the Atmospheric Air” (April 15, 1997). This overarching commitment along with detailed aspects has been formalized in the form of national legislation and supporting government statements or resolutions addressing specific CFC/HCFC related issues. Details of such legislation are provided in the outline of the HCFC phase-out Strategy.

Overall, Belarus has a relatively comprehensive legal and regulatory framework that allows MNREP the authority and administrative flexibility to fully control ODS generally and specifically Annex C ODS (i.e. HCFCs). This includes:  Regular reporting of data on the types and quantities of ODS produced, imported, consumed, and exported ODS and ODS containing products and submission of an annual report to the Ozone Secretariat of the Montreal Protocol as required under Article 7;  Establishment of a licensing system applicable to the import, export, retail trade, and use of HCFCs and HCFC containing products which in the case of imports can range from bans (as is the case for Annex A

47 and B to quotas or annual limits as is the case for Annex C (HCFCs), and extended to equipment/products containing ODS (Annex D);  Application of economic instruments through the license fees and environmental charges on HCFCs and HCFC containing products upon production, import and/or sale;  Authority to require record keeping and reporting on the consumption of ODS from all stakeholders and to prescribe technical alternatives to ODS; and  Elimination of new uses of ODS (including HCFCs).

Belarus completed phase out of Annex A substances in 2000 and Annex B substances in 2001 and has maintained compliance with the London Amendment control measures since that time. The only current consumption of ODS in the country is HCFCs, in the form of HCFC-141b in the manufacturing sector (PU foams and solvents) to small extent and HCFC-22 utilized for refrigeration servicing as the main consuming sector in the country.

The table below provides additional information on ratification of other chemical related MEAs:

Convention/Agreement Signature Ratification/ Accession (a) / Approval (aa) /Acceptance (A) Stockholm Convention on Persistent Organic Pollutants - 03/02/2004 (a) Basel Convention on the Trans-boundary Movement of Hazardous - 10/12/1999 (a) Waste and their Disposal Rotterdam Convention on Prior Informed Consent for Certain n/a n/a Chemicals and Pesticides in International Trade UNECE Convention on Long-Range Trans-boundary Air Pollution 14/11/1979 13/06/1980 – Gothenburg Protocol to Abate Acidification, Eutrophication, and n/a n/a Ground-Level Ozone – Aarhus Protocol on Persistent Organic Pollutants n/a n/a – Aarhus Protocol on Heavy Metals n/a n/a Convention on Access to Information, Public Participation in Decision 16/12/1998 09/03/2000 (aa) Making, and Access to Justice in Environmental Matters – Protocol on Pollutant Release and Transfer Registers n/a n/a ESPOO Convention on Environmental Impact Assessment in a Trans- 26/02/1991 10/11/2005 (A) boundary Context UN Framework Convention on Climate Change 11/06/1992 11/05/2000 (aa) – Kyoto Protocol - 26/08/2005 (a)

The project is specifically aligned with the outline of HCFC phase-out strategy, which was prepared for Belarus.

Type of Financing Support Provided

The project is designed to provide continuity with the initial GEF regional HCFC survey project.

The financing support provided will be in the form of a grant that will cover costs where foreign expenditures are required, recognizing the limited government and enterprise resources available to address HCFC phase-out. However, the GEF grant will leverage significant cash co-financing for the project that would otherwise not be channeled towards this global issue. This type of Grant funding is consistent with the GEF Focal Area Strategy as described above.

48 Sustainability

The principal sustainability requirement for the project is the upgraded capacity of the country that will be used to effectively control the import and use/re-use of HCFCs to stay in compliance with the Montreal Protocol’s obligations on phasing-out HCFC imports.

In terms of its design, the project aligns the technical assistance in specific sub-components to the national institutions and private sector that have accumulated CFC phase-out expertise and strengthen the overall system to address HCFC challenge. By doing so, the project will ensure that a required level of ownership is achieved to ensure sustainable results.

The project will also re-establish connections to the current regional, Montreal Protocol related information exchange platforms which involve a number of Art 5 countries from Europe/CIS, to help with adopting more effective HCFC control measures based on other country experiences.

Within the above framework, the detailed project design, at the component and sub-component level, has a number of features that are intended to promote sustainability as noted below:

 The project places emphasis on the regional information exchange and assistance in support of effective HCFC import and consumption regulatory controls, training of trainers to further disseminate knowledge and strengthen skills of Customs, environmental inspectors, refrigeration technicians, as well to provide support to the establishment of Refrigeration Association. Required Russian/local language materials will be formulated to help improve practical working level skills in ODS management and control. High degree of interconnection to the so far accumulated materials under MLF assistance in the region will be ensured to bring in best practices. The materials that will be developed will also be of use to Art 5 countries in the region, where HPMP implementation started in 2011.  The emphasis is also placed for hands-on training of relevant project partners at the national level in support of the implementation of the national component. All training (regional and national) conducted under the project will utilize written and replicable training materials and a “train the trainer” approach. The new and updated training modules will be introduced into the study curriculum of national training institutions in the country such as the MNR and Customs training academies.  HCFC consumption in the manufacturing sector will be substituted with non-ODS and low-to-zero GWP alternative technologies. In the case of solvents, the project plans commissioning of closed- cycle operation equipment to minimize emissions of new substitutes. Participating companies commit not to use HCFCs after completion of technical assistance projects.  Changes in HCFC handling practices will require strengthening basic capacities of individual technicians and technical centers in terms of availability of equipment servicing tools, something the project will provide the basis for through procurement and supply of such instruments. Upon the closure of the project, the tools/machinery will be transferred to reliable users to make sure the capacity is sustained beyond the projects duration.

49  The project will contribute to strengthen and sustain the capacity for HCFC phase-out in the longer term through its support to the implementation of the HCFC phase-out strategy and which will provide the Government with a “road map” in addressing future HCFC related challenges. An appropriate level of international expertise and technology transfer will be facilitated with GEF support to provide the country with sustaining capacity in HCFC management. The programme will assist in improving the capability of the country to re-use HCFCs and demonstrate best practices in managing end-of-life HCFCs in order to address its HCFC consumption in a comprehensive manner. ODS destruction capability will address unwanted ODSs and demonstrate experience in the regional context.

Demonstration of energy efficient equipment working on alternatives and promotion of natural cooling technologies will be essential in order to assist the country, and other countries in the region, to make the appropriate and most efficient choices to ensure that low/non ODP and low/no GWP technologies are demonstrated in practice

Replicability

As mentioned above, the country is approaching the final HCFC phase-out dates, with 75% reduction in the HCFC consumption as compared to the baseline in 2010 and further 90% reduction to be achieved by 2015. Through the successful implementation of this technical assistance project the country will be able to provide a useable example to other CIS countries in particular as regards the accelerated phase-out by 2015 and challenges/achievements possible in relation to EU harmonization. This accumulated experience will also be available to other countries in the region that operate both under non-Art 5 status as well as Art 5. The regional information exchange component will ensure all replicable results of the project are shared with interested countries on the regional basis.

50 3.5 Project Results Framework

This project will contribute to achieving the following Country Programme Outcome as defined in CPAP or CPD: 3.2: Sustainable use of the country’s natural resources promoted.

Country Programme Outcome Indicators: Indicator: A Road Map for mainstreaming the priority SMC issues in Belarus’ decision-making officially adopted by the Government Baseline: None Target: SMC is being mainstreamed into national decision in accordance with the adopted Road Map.

Primary applicable Key Environment and Sustainable Development Key Result Area (same as that on the cover page, circle one):

Applicable GEF Strategic Objective and Program

Objectives: To protect human health and the environment by assisting countries to phase out consumption and production and prevent releases of ODS according to their commitments to Montreal Protocol phase-out schedules, while enabling low-GHG (Greenhouse Gas) alternative technologies and practices.

Program: For the period of GEF-4, the GEF will assist eligible countries in meeting their HCFC phase-out obligations under the Montreal Protocol, and strengthening capacities and institutions in those countries that still are faced with difficulties in meeting their reporting obligations. Applicable GEF Expected Outcomes: (1) HCFCs are phased-out according to Montreal Protocol schedule, or faster, in GEF-eligible countries (2) GEF-eligible countries meet their reporting obligations under the Montreal Protocol Applicable GEF Outcome Indicators:

(1) Indicators for Outcome 1: (a) ODP adjusted tons of HCFCs phased-out from consumption (GEF-4 replenishment target: HCFCs: 50-70 ODP tons) (b) Percentage reduction in HCFC consumption in the participating countries (2) Indicators for Outcome 2: (a) Percentage of GEF-funded countries that meet their reporting obligations under the Montreal Protocol

51 Project Strategy Objectively verifiable Baseline Target Sources of Assumptions indicators verification to speed  Belarus is in  Approved HCFC phase-out  HCFC phase-out strategy fully  Status of HCFC  Overall government up the phase out of compliance with the MP strategy; formulated and recommended for phase-out strategy as commitment and facilitateObjective phasing: out obligations for 2015 and  Customs union with the adoption and implementation; a formal government assumption of ozone depleting 2020, or accelerates the Russian Federation that results in  Effective regulatory strategic document; appropriate substances, phase-out earlier than uncontrolled import of HCFCs instruments to control HCFC use,  National legal and responsibility; particularly HCFCs MP requirements are and HCFC based equipment; and thus, import of HCFCs and regulatory registers  Regulatory and their substitution enforced  Gaps in institutional capacity HCFC containing equipment in  Art 7 reporting to enforcement resources with modern and HCFC use control system; place and effectively Ozone Secretariat on and capacity available; alternative  implemented; HCFC import and  Project stakeholders substances in Weak HCFC re-use capacity  Printed materials on various monitoring of HCFC actively participate in accordance with the and low-level of technical aspects related to HCFC phase- import reduction; the project respective Belarus’ knowledge and instrumentation to out (policy control options, implementation and obligations under the address HCFC in the servicing  Project Progress enforcement and illegal trade, realization of HCFC Montreal Protocol, sector and M/E reports alternative technologies and phase-out strategy; along with  Limited technical knowledge energy-efficiency, ODS strengthening the relating to good refrigeration  Accurate monitoring destruction, best refrigeration system of import practices as regards alternative and reporting. practices etc) available control and refrigerants (non-ODS/low GWP  management of such as ammonia, carbon dioxide, Current capacities of project HCFCs in Belarus. etc) stakeholders strengthened through Also the project aims  No current information capacity building and investment to achieve products and programs support in manufacturing and servicing sectors compliance of  Limited availability of Belarus with the technical tools to test gas accelerated composition and quality as well Montreal Protocol as to limit emissions of HCFCs HCFC phase-out during equipment maintenance requirements  Limited exposure to alternative through stabilization technologies and understanding of and progressive energy-saving aspects of new reduction of HCFC modern equipment operational on consumption. new technologies

52 Project Strategy Objectively verifiable Baseline Target Sources of Assumptions indicators verification Outcome 1: Regional accelerated phase-out capacity building (containing four sub-components)

Outcome 1 (a):  Russian language  Key stakeholders generally have  Availability of key guidance  National legal and  In-country interagency Legislative and Policy resource materials on limited awareness of the issue or documentation in Russian, or local regulatory registers coordination is sustainable Options for HCFC HCFC control options actions required on the higher or languages, where required, on HCFC Equivalence through high-level phase-out and control prepared technical level to address HCFC control options, Customs comparison to Government support and  Awareness training for phase-out; enforcement approaches and international standards allows for timely decision-makers on  Decision-makers from methodologies, refrigeration sector  Number of participation of various legislative and regulatory enforcement department (MNR, capacity building, energy-efficiency, regional/sub-regional departments in regional actions accomplished Customs) have limited knowledge ODS destruction etc; meetings attended by meetings  Regional networking on and lack practical skills on the  High-level decision-makers of each country, and  MLF/UNEP-CAP and the country with Art 5 and regulatory approaches to effectively MNR, Customs, territorial specific department other regional and sub- other non Art 5 countries control HCFC related challenges; inspectorates, other Governmental (organized by regional conferences and in the region is supported  Limited number or lack of trained agencies such as Ministry of MLF/UNEP-CAP team meetings are organized on trainers on enforcement and best Education, Standardization or by the current HCFC phase-out subjects Outcome 1 (b):  Russian language refrigeration aspects; Committee are well informed and project) etc Capacity Building for resource documentation  Required materials in Russian or support the objectives of HCFC  Number of materials,  Trainers are further Enforcement of HCFC  Awareness raising local languages, on HCFC control consumption phase-out and in Russian, or local deployed for the training at control measures by activities measures to address this process; customs and options, Customs enforcement languages, prepared and national level  Training of Trainers  environmental/technical approaches and methodologies, Training of a selected number of used by the countries  Any additional training trainers on the technical level inspection authorities  PIC Network refrigeration sector capacity  Number of will be organized at  Regional networking building, energy-efficiency, (Customs controls and refrigeration involved/trained national level (with or w/o alternative technologies and their practices) is complete on regional participation of Outcome 1 (c): decision makers and  Preparation of Russian application, illegal trade and PIC, level to initiate trainings on national international trainer) Capacity Building for trainers trained in each language training manuals technician certification and ODS level the Refrigeration country and information materials waste management related issues are  Regional networking with non Art Sector, Incorporation of  Monitoring of press  ToT on Best limited in availability or absent; 5 and other Art 5 countries re- Energy-Efficiency and and media coverage Refrigeration Practices established, contacts re-engaged, and GHG reduction  Regional networking with other  Project Progress and overall supports accelerated capacity elements partner countries in the region is M/E reports lacking which prevents information building of the country as well as Outcome 1 (d): Support  Preparation of Russian essential experience exchange on for the development of and experience exchange [see topics language information above]; important HCFC phase-out related regional institutions, materials  Cooperation between non-Art 5 topics capacity, and  Promotion of cooperation countries on effective action Information exchange standards is minimal or absent. mechanisms  Facilitation of regional dialogue

Outcome 2: National level phase-out capacity building

53 Project Strategy Objectively verifiable Baseline Target Sources of Assumptions indicators verification Outcome 2 (a –  Formal HCFC Phase-out  No formal HCFC strategy is  HCFC phase-out strategy fully  National legal and  Government Belarus): HPMP, strategy and action plan adopted and enforced through formulated, packaged as draft regulatory registers commitment to timely National Level developed and endorsed regulatory measures legislation for Government approval  Equivalence processing of required Capacity Strengthening  Inter-agency coordination to and cleared by line comparison to HCFC action plan and and HCFC Phase Out address HCFC phase-out is limited Ministries/departments for final international standards regulations Investment  No updated HCFC and HCFC endorsement  Confirmation  Art 7 compliance equipment import quota and use  Widely accessible information on correspondence from reporting to Ozone system is in place HCFC phase-out strategy and its Government to UNDP Secretariat  Low level of awareness related to elements  Monitoring of press  Interagency coordination HCFC phase-out across stakeholders  Inter-agency coordination related and media coverage is sustainable through and general public to HCFC phase-out is improved  Project Progress and high-level Government  No current information products  Effective regulatory measures M/E reports support and programs (quotas etc) are updated and  Stakeholders support enforced updated regulations  Main stakeholders are informed about HCFC phase-out strategy and regulatory measures related to HCFC import and use control  Trained and equipped  Key Government stakeholders as  Inclusion of HCFC control issues  Prepared and  Interagency coordination working level Customs and well as working level officials have into curricula of Customs and registered educational (Ministry of Education is enforcement officials, and limited awareness of HCFC phase- enforcement officials’ training curricula supportive of changes to refrigeration technicians out issue, challenges to address it institutions  Attendance at training curricula) is sustainable using resources (trainers and skills/tools to enforce HCFC  Update of study plans for information sessions through high-level and training materials) control measures in practice refrigeration technicians at and events Government support from Component 1 with  Limited active educational efforts specialized training centers and  Customs reporting  Sustaining interest and respect to legislation, or tools are available technical universities, vocational information capacity in educational regulations, customs  Illegal trade in ODS continues schools, MNR institute for  Procurement institutions to maintain controls, refrigeration unregistered and unnoticed inspectors training documents on supply of educational programs servicing techniques, and  No current information products  Well informed stakeholder equipment  Active participation and general best practices and programs community engaged in addressing  Project Progress and partnership with education  Lack of portable HCFC analytical HCFC phase-out issue with required M/E reports institutions and large scale equipment and skills to control end level of understanding and technical attendance of training use and illegal imports capacity events  General absence of basic servicing  Re-tooling (basic portable tools to strengthen HCFC re-use analytical and instrumentation for system servicing sector) of main stakeholder groups implemented  Illegal trade is registered and stopped at entry points  Targeted HCFC Phase- out Investment Program and Demonstration projects

54 Project Strategy Objectively verifiable Baseline Target Sources of Assumptions indicators verification  Implementation of a  MAZ-Kupava (foam product  MAZ-Kupava technologically  Procurement  Government requires foam conversion manufacturer) depends on HCFC- converted to non-ODS/ low GWP documents on supply of regular reporting and project at MAZ Kupava 141b in manufacturing processes; technology (HCFC-141b based equipment performs monitoring of  Alternative technologies are polyols to c-pentane)  Mission and site visits works scarcely available to the company  HCFC use at MAZ Kupava reports of international  Supplied equipment is for access and transfer, not tested at stopped and company committed not and national consultants adequately maintained and the facility and lack processing and to use HCFCs any longer  Company’s written used by company safety instrumentation for practical  Technical staff is knowledgeable commitments to stop  Company continues to introduction on correct use of new technology usage of HCFCs in co-finance the project as  Refrigerated trucks with foam manufacturing processesspecified in the co-finance insulation continue to be  Project Progress and commitments manufactured with the use of M/E reports HCFCs  Implementation of a  Atlant/David-Gorodok (solvent  Atlant/David-Gorodok  Procurement  Government requires solvent conversion users) depends on HCFC-141b in technologically converted to non- documents on supply of regular reporting and project at David manufacturing processes and this is ODS technology (HCFC-141b to equipment performs monitoring of Gorodok a high emissive use of HCFCs; transblends based on HFCs – closed  Mission and site visits works Electromechanical  Alternative technologies are loop cycle and minimization of reports of international  Supplied equipment is Plant scarcely available to the company agent use reduce emissions) and national consultants adequately maintained and for access and transfer, not tested at  HCFC use at Atlant/David-  Company’s written used by company the facility and lack processing and Gorodok stopped and company commitments to stop  Company continues to safety instrumentation for practical committed not to use HCFCs any usage of HCFCs in co-finance the project as introduction longer manufacturing processesspecified in the co-finance  Spares (compressors and others)  Technical staff is knowledgeable  Project Progress and commitments for refrigerators continue to be on correct use of new technology M/E reports manufactured with the use of HCFCs as degreasing agent

55 Project Strategy Objectively verifiable Baseline Target Sources of Assumptions indicators verification  Demonstration of  Limited proliferation of low GWP  Non-ODS/low-zero GWP (NH3,  National legal and  Interagency coordination benefits of natural alternatives (NH3, CO2 double CO2 double stage, HCs etc) regulatory registers on (Standardization cooling in one or two stage, HCs etc) to HCFCs in technologies in the servicing sector safety standards Committee is supportive of sectors such as refrigerated equipment; demonstrated and promoted through  Equivalence changes to standards) is agricultural milk  Safety standards for new low awareness raising; comparison to sustainable through high- coolers GWP alternatives do not exist  Stakeholder community international standards level Government support  Generally low awareness on new (private/public HCFC equipment  Procurement  Costs of new equipment alternative technologies in the user sector) well informed about documents on supply of does not exceed project servicing sector and benefits in new alternative technologies and equipment budget energy savings (co-benefits for their benefits;  Mission and site visits  Project participants economic operations as well as for  Local engineering companies gain reports of international maintain their interest in climate change); knowledge and skills to assemble and national consultants the use of new equipment  No current information products and operate such technologies in  Monitoring of press and co-finance local and programs; future; and media coverage design, installation and maintenance works  Lack of experience with,  Safety standards for new  Project Progress and knowledge of and skills to assemble, alternatives reviewed and adopted; M/E reports install, operate and maintain HCFC-  Performance of new equipment is free commercial/industrial regularly recorded; equipment using non-ODS/low-zero  Market is more prepared for the GWP technologies; acceptance of new alternatives.  Low readiness for/acceptance of new technologies by end-users.  Upgrade of HCFC re-  HCFCs are not re-used  Regulatory measures to ban single  Attendance of  Government informs the use system through domestically – lack of a use containers are effected and allow technical centers’ staff stakeholder community on strengthening R/R/R comprehensive HCFC re-use system,to create HCFC distribution system and other technicians at HCFC restrictions, HCFC centers and improving and country depends on imports in country; training and information phase-out strategy and local distribution of  HCFC re-cycling and reclaim  HCFC re-use system upgraded events; further limits HCFC and bulk HCFC/HFCs in equipment, or network, is generally through strengthening R/R/R centers  Procurement HCFC equipment imports; support of container outdated and not suited for HCFCs – country’s technical capacity is documents on supply of  Government requires import regulations in the former case and is absent in improved; equipment; regular reporting and the latter  HCFC re-use system is  Mission and site visits perform monitoring of  Analytical equipment for servicingimplemented in practice allowing to reports of international works; sector does not exist to ensure reduce dependence on import of and national consultants  Supplied equipment is quality of re-cycled/reclaimed HCFCs; on refrigerant adequately maintained and HCFC refrigerants and improve  Technical center staff is trained on recovery/recycling and used by company. confidence of buyers (servicing adequate use of equipment and best reclamation rates; centers/technicians or end-users) refrigeration practices in equipment  Project Progress and  Limited active educational efforts maintenance and retrofits; M/E reports. or tools on best refrigeration  Well informed stakeholder servicing practices are available community engaged in addressing HCFC phase-out issue with required level of understanding and technical capacity.

56 Project Strategy Objectively verifiable Baseline Target Sources of Assumptions indicators verification  Pilot unwanted ODS  Gradual accumulation of obsolete  Small-scale obsolete ODS  Procurement  Government supports Destruction Project ODS waste (unusable mixtures and destruction capacity established on a documents on supply of the acceptance of ODS emptied HCFC cylinders with ODS pilot basis to re-enforce the HCFC equipment destruction technology and fractions) and the acute need to re-use system and a planned ban on  Mission and site visits supervises its application dispose of such wastes; single use containers; reports of international and performance by  Only prototype laboratory  Staff trained to operate and and national consultants equipment recipients; equipment on hazardous waste maintain equipment; on refrigerant  Equipment recipients are processing exists with no emission  Stockpiles of obsolete ODS destruction rates available and willing to controls in place; destroyed by supplied technology;  Project Progress and operate the technology  Small quantities of obsolete ODS  Country is fully equipped to M/E reports with co-finance waste to generate interest for export handle full-cycle of ODS commitments ready to major hazardous waste destructionmanagement with demonstration sites element;  Lack of integration of ODS  Dissemination of results disposal into HCFC re-use system to performed on the regional scale. complete ODS management cycle  Generally lack of appropriate ODS destruction experience in Central Asia region Outcome 3:  M&E and adaptive  No Monitoring and Evaluation  Monitoring and Evaluation system  Project document  Availability of reference Monitoring, learning, management applied to system developed during year 1. inception workshop material and progress adaptive feedback, project in response to  No evaluation of project output  Mid-term-evaluation of project report. reports outreach and needs, mid-term evaluation and outcomes output and outcomes conducted with  Independent mid-term  Cooperation of evaluation findings with lessons lessons learnt at 30 months of evaluation report. stakeholder agencies and learned extracted. implementation.  Final evaluation other organizations.  Final evaluation report ready in report the end of project

Outcome 1 (a): Legislative and Policy Options for HCFC phase-out and control Output 1a.1: Russian language resource materials on HCFC control options prepared Output 1a.2: Awareness training for decision-makers on legislative and regulatory actions accomplished Output 1a.3: Regional networking on the country with Art 5 and other non Art 5 countries in the region is supported Outcome 1 (b): Capacity Building for Enforcement of HCFC control measures by customs and environmental/technical inspection authorities Output 1b.1: Russian language resource documentation Output 1b.2: Awareness raising activities Output 1b.3: Training of Trainers Output 1b.4: PIC Network Output 1b.5: Regional networking Outcome 1 (c): Capacity Building for the Refrigeration Sector, Incorporation of Energy-Efficiency and GHG reduction elements Output 1c.1: Preparation of Russian language training manuals and information materials Output 1c.2: ToT on Best Refrigeration Practices

57 Outcome 1 (d): Support for the development of regional institutions, capacity, and cooperation Output 1d.1: Preparation of Russian language information materials Output 1d.2: Promotion of Information exchange mechanisms Output 1d.3: Facilitation of regional dialogue Outcome 2 (a – Belarus): HPMP, National Level Capacity Strengthening and HCFC Phase Out Investment Output 2a.1: Formal HCFC Phase-out strategy and action plan developed and endorsed Output 2a.2.: Trained and equipped working level Customs and enforcement officials, and refrigeration technicians using resources (trainers and training materials) from Component 1 with respect to legislation, regulations, customs controls, refrigeration servicing techniques, and general best practices Output 2a.3: Targeted HCFC Phase-out Investment Program and Demonstration projects Outcome 3a: Monitoring, learning, adaptive feedback, outreach and evaluation Output 3a.1: M&E and adaptive management applied to project in response to needs, mid-term evaluation findings with lessons learned extracted. Output 3a.2: Lessons learned and best practices are replicated at national level

58 3.6 Total Budget and Workplan

Responsible Atlas Party/ Amount Amount Amount See Fund Donor Budgetary ATLAS Budget GEF Outcome/Atlas Activity Year 1 Year 2 Year 3 Total (USD) Budget ID Name Account Description Implementing (USD) (USD) (USD) Note: Agent Code

OUTCOME 1: Regional accelerated phase-out capacity building (to be implemented by UNDP Regional Center in Slovakia)

OUTCOME 2: HPMP, National Level Capacity Strengthening and HCFC Phase Out Investment

Contractual services 72100 (workshops, rent, $9,000 $0 $0 $9,000 x equipment, etc) Output 2.1: Formal HCFC Phase-out strategy and NIM 62000 GEF Contractual services action plan developed and endorsed 72100 $6,000 $0 $0 $6,000 x (publications etc)

Sub-total $15,000 $0 $0 $15,000

Equipment (Customs 72200 $100,000 $214,000 $95,200 $409,200 x and technicians) Contractual services 72100 (Training of Customs $40,000 $48,000 $0 $88,000 x and technicians) Office equipment Output 2.2.: Trained and equipped working level 72200 (Training equipment for $36,000 $0 $0 $36,000 x Customs and enforcement officials, and institutions) refrigeration technicians using resources (trainers NIM 62000 GEF International and training materials) from Component 1 71200 Consultants (to deliver $15,000 $0 $0 $15,000 x trainings) 71300 National consultant $10,000 $10,000 $10,000 $30,000 x Contractual services 72100 $5,000 $5,000 $0 $10,000 x (publications etc)

Sub-total $206,000 $277,000 $105,200 $588,200

Output 2.3: Targeted HCFC Phase-out Investment Program and Demonstration projects

Implementation of a foam conversion project at International NIM 62000 GEF 71200 $20,000 $10,000 $0 $30,000 x MAZ Kupava Consultant (TA)

59 71300 National consultant $5,000 $5,000 $0 $10,000 x 72200 Equipment $407,800 $100,000 $0 $507,800 x

Sub-total $432,800 $115,000 $0 $547,800

International 71200 $10,000 $10,000 $0 $20,000 x Consultant (TA)

Implementation of a solvent conversion project at 71300 National consultant $5,000 $0 $0 $5,000 x NIM 62000 GEF David Gorodok Electromechanical Plant 72200 Equipment $151,000 $0 $0 $151,000 x

Sub-total $166,000 $10,000 $0 $176,000 72200 Equipment $0 $100,000 $110,000 $210,000 x

International 71200 $0 $15,000 $5,000 $20,000 x Consultant (TA)

Demonstration of benefits of natural cooling in one 71300 National consultant $0 $5,000 $15,000 $20,000 x NIM 62000 GEF or two sectors such as agricultural milk coolers Contractual services 72100 (workshops, rent, $0 $10,000 $0 $10,000 x equipment, etc)

Sub-total $0 $130,000 $130,000 $260,000

72200 Equipment $50,000 $111,000 $0 $161,000 x

International 71200 $5,000 $0 $0 $5,000 Upgrades of HCFC re-use system NIM 62000 GEF Consultant (TA)

71300 National consultant $5,000 $5,000 $5,000 $15,000 x

Sub-total $60,000 $116,000 $5,000 $181,000 Equipment (with 72200 $0 $0 $155,000 $155,000 x support form supplier) 71300 National consultant $0 $0 $7,000 $7,000 71200 International expert $0 $10,000 $10,000 $20,000 Unwanted ODS Pilot Destruction Project NIM 62000 GEF Contractual services 72100 (workshops, rent, $0 $0 $15,000 $15,000 x equipment, etc)

Sub-total $0 $10,000 $187,000 $197,000 Total Outcome 2 $879,800 $658,000 $427,200 $1,965,000

60 OUTCOME 3: Monitoring, learning, adaptive feedback, outreach and evaluation - Belarus

International 71200 $0 $15,000 $20,000 $35,000 x OUTCOME 3: Monitoring, learning, adaptive Consultants NIM 62000 GEF feedback, outreach and evaluation - Belarus Total M & E $0 $15,000 $20,000 $35,000

71300 Local Consultants $30,000 $45,000 $45,000 $120,000 x

71600 Travel $20,000 $15,000 $10,000 $45,000 x

72200 Equipment $20,000 $0 $0 $20,000 x

Project Management Budget (PMB) NIM 62000 GEF Miscellaneous (office 74500 supplies, $5,000 $2,000 $2,000 $9,000 x communication) 74500 Miscellaneous (audit) $2,000 $2,000 $2,000 $6,000 x

Total Management national $77,000 $64,000 $59,000 200,000

PROJECT TOTAL national w/o PMC $879,800 $673,000 $447,200 $2,000,000

PROJECT TOTAL national $956,800 $737,000 $506,200 $2,200,000

61 3.7 WorkPlan Implementation Schedule

Year 1 Year 2 Year 3 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D OUTCOME 1: Regional accelerated phase-out capacity building (containing four sub-components) OUTCOME 1a: Internatio Legislative and nal Policy Options Consulta for HCFC phase- nts out and control OUTCOME 1b: Capacity Building Contractu for Enforcement al of HCFC control services measures by (worksho customs and ps, rent, environmental/tec equipmen hnical inspection t, etc) authorities OUTCOME 1c: Capacity Building for the Contractu Refrigeration al Sector, services Incorporation of (publicati Energy- ons etc) Efficiency and GHG reduction elements OUTCOME 1d: Support for the Travel development of (travel regional and institutions, DSA) capacity, and cooperation

62 OUTCOME 2: HPMP, National Level Capacity Strengthening and HCFC Phase Out Investment (containing four outputs) Contractual Output 2.1: services Formal HCFC (workshops, Phase-out rent, strategy and equipment, etc) action plan Contractual developed and services endorsed (publications etc) Equipment (Customs and technicians) Contractual Output 2.2.: services Trained and (Training of equipped Customs and working level technicians) Customs and Office enforcement equipment officials, and (Training refrigeration equipment for technicians institutions) using International resources Consultants (to (trainers and deliver training trainings) materials) from National Component 1 consultant Contractual services (publications etc)

63 Output 2.3: Targeted HCFC Phase- out Investment Program and Demonstration projects (containing four sub-components) International Consultant Implementation (TA) of a foam conversion project National at MAZ Kupava consultant Equipment International Implementation Consultant of a solvent (TA) conversion project at David Gorodok National Electromechanical consultant Plant Equipment

Equipment International Consultant Demonstration (TA) of benefits of National natural cooling in consultant one or two sectors such as agricultural Contractual milk coolers services (workshops, rent, equipment, etc) Equipment Upgrades of International HCFC re-use consultant system National consultant Equipment National consultant Unwanted ODS Contractual Pilot Destruction services Project (workshops, rent, equipment, etc)

64 OUTCOME 3: Monitoring, learning, adaptive feedback, outreach and evaluation International Consultants Local Consultants Travel Overall Management Equipment Components Miscellaneous (office supplies, communication) Miscellaneous (audit)

65 Belarus Refrigerant Management Plan

4 Management Arrangements

The Ministry of Natural Resources and Environmental Protection of Belarus (Ministry of Environment) acting as an executing agency for this project will take responsibility for overall coordination of project implementation, efficient use of project resources and achievement all the planned project results. The executing agency closely cooperates with UNDP to ensure successful implementation of all the projects activities and achievement of all the objectives and tasks. The executing agency (Ministry of Environment) will assign a senior official as the Project Director who will provide general coordination and support to the project on behalf of the Ministry of Environment.

The project organization structure (summarized in the figure below) will consist of a Project Board, Project Assurance, and a Project Implementation Unit (PIU).

Project Organization Structure

Project Board

The key national and Ministry of Environment UNDP international stakeholders

Project Assurance

Responsible UNDP Programme Officer PIU

Expert Team Expert Team Component 1 Component 2

A Project Steering Committee (PSC) will be established at the inception phase of the project to monitor the project progress, to guide its implementation and to support the project in achieving its listed outputs and outcomes. It will be chaired by the Project Director and include representatives from the main stakeholders, including the Ministry of Environment the State Customs Committee, APIMH, MAZ- Kupava, David-Gorodok Electromechanical and UNDP. Other members can be invited at the decision of the PSC on an as-needed basis, but taking due regard that the PSC remains sufficiently lean to be operationally effective. The project manager will participate as a non-voting member in the PSC meetings and will also be responsible for compiling a summary report of the discussions and conclusions of each meeting. The final list of the PSC members will be completed at the outset of project operations and will be approved by UNDP and the Ministry of Environment. The first PSC meeting will take place within 6 months from the project start date. The PSC will meet at least twice a year to discuss the issues related to project implementation. The PSC could meet more often if it will be deemed necessary.

66 Belarus Refrigerant Management Plan

The Project Assurance role supports the Project Board Executive by carrying out objective and independent project oversight and monitoring functions. The Project Assurance role will rest with the UNDP Belarus Environment Focal Point. The day-to-day management of the project will be carried out by a Project Implementation Unit under the overall guidance of the Project Steering Committee. The PIU will include Project Manager, Scientific Coordinator, who will provide scientific support to the project activities, including development and official approval of the a register of refrigeration equipment, conditioning systems and technological processes using HCFCs, Administrative and Financial Assistant and Procurement Specialist. The PIU staff will be selected through an open competitive process in accordance with the respective UNDP rules and procedures taking into account consultations with the Ministry of Environment. Effectiveness of the PIU staff work will be evaluated annually by the UNDP Belarus. Based on the evaluation results and consultations with the Project Director, a decision will be made on renewal/non-renewal of the PM contract. Tentative ToR for the PM presented in Annex 3.

A work plan for the first year of project implementation will be developed and approved by the Ministry of Environment and UNDP during the project inception stage. Work plans for the second and subsequent project implementation years will be prepared during the last month of an on-going year.

The UNDP Belarus will maintain the oversight and management of the overall project budget. It will be responsible for monitoring project implementation, timely reporting of the progress to the donor/donors. It will also support the executing agency in the procurement of the required expert services and other project inputs and administer the required contracts. Furthermore, it will support the co-ordination and networking with other related initiatives and institutions in the country. The description of UNDP Country Office support services is provided in Annex 6.

For successfully reaching the objective and outcomes of the project, it is essential that the progress of different project components will be closely monitored both by the key local and international stakeholders and, starting with the finalization of the detailed, component-specific work plans and implementation arrangements and continuing through the project’s implementation phase. The purpose of this is to facilitate early identification of possible risks to successful completion of the project together with adaptive management and early corrective action, when needed. During the implementation, proper care will be taken to have adequate communication and co-ordination mechanisms in place to ensure that areas of common interest can be addressed in a cost-efficient way.

Monitoring and Evaluation

The project will be monitored through the following M& E activities. The M& E budget is provided in the table below. Further explanatory details are provided in the regional (umbrella) project document.

Recruitments of M&E experts will be managed regionally through COA codes provided by UNDP Country Office.

M&E Work Plan and budget

Type of M&E Responsible Parties Budget US$ Time frame activity Inception . Project Manager Within first two Workshop and . UNDP CO, UNDP GEF Staff time months of project Report . International Technical start up

67 Belarus Refrigerant Management Plan

Type of M&E Responsible Parties Budget US$ Time frame activity Support/Safeguards Expert Measurement of . UNDP GEF RTA/Project Start, mid and end Means of Manager will oversee the None of project (during Verification of hiring of specific studies and evaluation cycle) project results. institutions, and delegate and annually when responsibilities to relevant required. team members. Measurement of . Oversight by Project Annually prior to Means of Manager None ARR/PIR and to the Verification for . Project team definition of annual Project Progress work plans on output and implementation ARR/PIR . Project manager and team None Annually . UNDP CO . UNDP RTA . UNDP EEG Periodic status/ . Project manager and team None Quarterly progress reports Mid-term . Project manager and team Indicative cost: At the mid-point of Evaluation . UNDP CO 15,000 project . UNDP RCU implementation. . External Consultants (i.e. evaluation team) Final Evaluation . Project manager and team, Indicative cost: At least three . UNDP CO 20,000 months before the . UNDP RCU end of project . External Consultants (i.e. implementation evaluation team) Project Terminal . Project manager and team At least three Report . UNDP CO months before the . local consultant Staff time end of the project . International Technical Support/Safeguards Expert Audit . UNDP CO None (cost in PM Yearly . Project manager and team Budget) Visits to field . UNDP CO For GEF supported Yearly sites . UNDP RCU (as appropriate) projects, paid from IA . Government representatives fees and operational . budget TOTAL indicative COST Excluding project team staff time and UNDP staff US$ 35,00015 and travel expenses

15 Costs only for International Consultant supporting M&E as part of Technical support/safeguards monitoring. It is estimated that additional US$15,000 from project management salaries will be devoted to M&E activities. Audit costs in the Project Management component are US$6,000.

68 Belarus Refrigerant Management Plan

5 Legal Context

This project document shall be the instrument referred to as such in Article 1 of the SBAA between the Government of the Republic of Belarus and UNDP, signed on September 24, 1992. Consistent with the Article III of the Standard Basic Assistance Agreement, the responsibility for the safety and security of the executing entity and its personnel and property, and of UNDP’s property in the executing entity’s custody, rests with the executing agency.

The executing entity shall: a) put in place an appropriate security plan and maintain the security plan, taking into account the security situation in the country where the project is being carried; b) assume all risks and liabilities related to the executing agency’s security, and the full implementation of the security plan.

UNDP reserves the right to verify whether such a plan is in place, and to suggest modifications to the plan when necessary. Failure to maintain and implement an appropriate security plan as required hereunder shall be deemed a breach of this agreement. The executing entity agrees to undertake all reasonable efforts to ensure that none of the UNDP funds received pursuant to the Project Document are used to provide support to individuals or entities associated with terrorism and that the recipients of any amounts provided by UNDP hereunder do not appear on the list maintained by the Security Council Committee established pursuant to resolution 1267 (1999). The list can be accessed via http://www.un.org/Docs/sc/committees/1267/1267ListEng.htm. This provision must be included in all sub-contracts or sub-agreements entered into under this Project Document.

Audit Clause: The Audit will be conducted in accordance with UNDP Financial Regulations and Rules and applicable audit policies on UNDP projects.

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6 Annexes

Annex 1 - Risk Analysis

Use the standard UNDP Atlas Risk Log template. For UNDP GEF projects in particular, please outline the risk management measures including improving resilience to climate change that the project proposes to undertake.

The Project Indicators, Risks and Assumptions are fully represented in the Strategic Results Framework (Annex A) as well as the Risk Identification and Mitigation tables in the corresponding GEF CEO Endorsement Document (Section G). It is suggested to refer to these indicated annexes and sections of the CEO endorsement document for more detailed information.

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Annex 2 - Agreements

Any additional agreements, such as cost sharing agreements, project cooperation agreements signed with NGOs16 (where the NGO is designated as the “executing entity”, letters of financial commitments, GEF OFP letter, GEF PIFs and other templates for all project types) should be attached.

GEF OFP Endorsement letter is attached to the submission package

16 For GEF projects, the agreement with any NGO pre-selected to be the main contractor should include the rationale for having pre-selected that NGO.

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Annex 3 - Terms of Reference17:

Project Board and National Project Manager PROJECT BOARD Composition and organization: The Project Board includes representatives (1) Ministry of Environment (2) UNDP and (3) main stakeholders (individual or group of individuals representing the interests of those who will ultimately benefit from the project). I. Specific responsibilities 1. Initiating a project: . Agree on PM’s responsibilities, as well as the responsibilities of the other members of the Project Management team; . Delegate any Project Assurance function as appropriate; . Review and appraise detailed Project Plan and AWP, including Atlas reports covering activity definition, quality criteria, issue log, updated risk log and the monitoring and communication plan. 2. Running a project: . Provide overall guidance and direction to the project, ensuring it remains within any specified constraints; . Address project issues as raised by the Project Manager; . Provide guidance and agree on possible countermeasures/management actions to address specific risks; . Agree on Project Manager’s tolerances in the Annual Work Plan and quarterly plans when required; . Review the Project Annual Review Report, make recommendations for the next AWP, and inform the Outcome Board about the results of the review. . Review and approve end project report, make recommendations for follow-on actions; . Provide ad-hoc direction and advice for exception situations when project manager’s tolerances are exceeded; . Assess and decide on project changes through revisions; 3. Closing a project: . Assure that all Project deliverables have been produced satisfactorily; . Review and approve the Final Project Review Report, including Lessons-learned; . Make recommendations for follow-on actions to be submitted to the Outcome Board; . Commission project evaluation (only when required by partnership agreement) . Notify operational completion of the project to the Outcome Board.

National Project Director As a representative the Executing Entity, the National Project Director has the main responsibility to ensure that the project is executed in accordance with the project document and the UNDP guidelines for nationally executed projects.

17 TORs for technical personnel will be formulated at implementation stage

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His/her main duties and responsibilities include:  Supervising the work of the Project Manager through meetings at regular intervals to receive project progress reports and provide guidance on policy issues;  Certifying the annual and, as applicable, quarterly work plans, financial reports, ensuring their accuracy and consistency with the project document and its agreed amendments;  Unless otherwise agreed, chairing the Project Steering Committee and representing the project in other required meetings;  Taking the lead in developing linkages with the relevant authorities at national, provincial and governmental level and supporting the project in resolving any institutional or policy related conflicts that may emerge during its implementation;

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Project Manager - tentative Terms of Reference

I. Position Information Position Title: Project Manager SC range: SC-9 Project Title: Duration of the service: 1 year (with possible extension subject to satisfactory performance) Work status Full-time Reports To: Head of Environment and Energy Unit

II. Background Under supervision of UNDP Belarus, manages the project

III. Functions / Key Outputs Expected  Responsible for day-to-day management, administration and decision-making for the project;  Oversees strategic planning process for the project and ensures its implementation in accordance with the signed project document;  Responsible for ensuring that the project produces the results specified in the project document, to the required standard of quality and within the specified constraints of time and cost;  Manage the realization of project outputs through activities;  Ensures that project contributes to the promotion of gender equality by reaching, involving and benefiting both women and men in its activities (gender mainstreaming);  Provide direction and guidance to project team(s)/ responsible party (ies);  Identifies partnership strategies with regard to providers of specialised expertise and possible co- financiers, and assists in resource mobilisation for project components;  Identify and obtain any support and advice required for the management, planning and control of the project;  Liaise with any suppliers;  Perform other duties related to the scope of work of the PM as required Running a project  Plan the activities of the project and monitor progress against the initial quality criteria;  Mobilize goods and services to initiative activities, including drafting TORs and work specifications;  Manage requests for the provision of financial resources by UNDP, using advance of funds, direct payments, or reimbursement;  Manage and monitor the project risks, submit new risks to the Project Board for consideration and decision on possible actions if required; update the status of these risks by maintaining the Project Risks Log;  Be responsible for managing issues and requests for change by maintaining an Issues Log;  Prepare the quarterly and annual financial and progress reports and submit the reports to the Project Board, UNDP and GEF, reports for the executing agency;  Monitors the implementation of project components, analyses problems that hamper their implementation and takes appropriate measures to ensure timely delivery of required inputs and

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achievement of project-wide results;  Monitors and reports to UNDP on all financial and procurement matters of the project, including proper utilization of funds and delivery, budget revisions, availability of funds, reconciliation of accounts, establishment of internal control mechanisms. Acts as a focal point to liaise with auditors and ensures follow-up actions. Ensures the accuracy and reliability of financial information and reporting;  Monitors and facilitates advocacy and mass media outreach activities, writing of success stories, newspapers coverage, PR campaigns;  Organize workshops, seminars and round tables to introduce project outputs to all stakeholders involved. Render support to related UNDP thematic activities such as publications, sharing of knowledge and group discussions;  Liaises with other UNDP and UNDP-GEF funded projects to implement possible synergies. Closing a Project  Ensure proper operational, financial and programmatic closure of the project;  Prepare Final Project Review Reports to be submitted to the Project Board and the Outcome Board;  Identify follow-on actions and submit them for consideration to the Project Board; Manage the transfer of project deliverables, documents, files, equipment and materials to national beneficiaries;  Prepare final CDR for signature by UNDP and the Implementing Partner.

IV. Recruitment Qualifications Masters degree in any of the following areas: Chemicals, Natural Resources Education: Management, Business Administration, Management or a related field. At least 5-years relevant experience. Working experience in international Experience: organizations is an advantage. Excellent command of spoken and written English, Byelorussian and Language Requirements: Russian are essential Understanding of development issues, national public institutional arrangements, knowledge of and experience in gender mainstreaming is an asset; Initiative and strong leadership skills; Result and client-orientations; Others: Strong analytical, communication and management skills; Excellent interpersonal and cross cultural communication skills, ability to work in a team and to work under pressure and with tight deadlines, ethics and honesty; Ability to use information and communication technology as a tool and resource

Administrative and Finance Assistant - tentative Terms of Reference I. Position Information Position Title: Administrative and Finance Assistant SC range: SC-6 Project Title: Duration of the service: 1 year (with possible extension subject to satisfactory performance) Full-time Work status Project Manager Reports To:

II. Background Under direct supervision of Project Manager, AFA is fully responsible for operational and programmatic

75 Belarus Refrigerant Management Plan management of the project according to the project document, UNDP corporate rules and procedures and for fulfilling the following functions.

III. Functions / Key Outputs Expected  Be responsible for logistics, procurement, finance and recruitment for the project, in accordance with corporate UNDP rules and regulations;  Prepare all financial and administrative documents related to the project implementation;  Develop quarterly and annual budget plans for recruitment of personnel; maintain financial records and monitoring systems to record and reconcile expenditures, balances, payments and other data for day-to- day transaction and reports;  Advise and assist Project staff, experts and consultants on all respects of allowances, salary advances, travel claims and other financial and administrative matters, and calculate and authorize payments due for claims and services;  Prepare detailed cost estimates and participates in budget analysis and projections as required to handle all financial operations of the project office and reconcile all accounts in required time frame;  Maintain, update and transmit inventory records of non-expendable equipment in accordance with UNDP rules;  Perform cash custodian’s duties being primarily responsible for project’s cash disbursements and maintain project’s petty cash book and payrolls related to the regional offices;  Ensure leave monitoring of project staff, check the accuracy and proper completion of monthly leave reports;  Analyze the potential problems concerning administrative-financial issues and take respective measures to provide adequate project’s resources in time for implementation of the project activities;  Define the cost-effective measures for optimal use of resources of the project;  Ensure full compliance of administrative and financial processes and financial records with UNDP rules, regulations, policies and strategies;  Encourage awareness of and promotion of gender equality among project staff and partners;  Perform other duties related to personnel, administrative and financial issues of project as required.

IV. Recruitment Qualifications Higher education in any of the following areas: Economics, Finance, Education: Business administration, Management or a related field. At least 3-years relevant experience. Working experience in international Experience: organizations is an advantage. Language Requirements: Fluency in English, Russian and Byelorussian Strong analytical, communication and management skills, result and client- orientation, ability to work in a team; Ability to work under pressure and with tight deadlines, ethics and honesty; Others: Ability to use information and communication technology as a tool and resource; Experience in handling web-based management systems Ability to handle multiple tasks simultaneously and ability to prioritize

At least 3 years of progressive work experience relevant to the above requirements, including experience of arranging and providing media Experience: coverage of round-tables/seminars. Working experience in international organizations is advantage. Experience in web content development is an asset

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Language Requirements: Proficient in English, Russian and Byelorussian Strong analytical, communication and management skills, client- orientation, ability to work in a team; Initiative, analytical judgment, ability to work under pressure and with Others: tight deadlines, ethics and honesty; Ability to use information and communication technology as a tool and resource.

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Annex 4 - Maz Kupava Conversion Project (141b to c-pentane)

PROJECT COVER SHEET – NON-MULTI-YEAR INVESTMENT PROJECTS

COUNTRY: PROJECT TITLE IMPLEMENTING AGENCY MAZ KUPAVA - Conversion from HCFC-141b to c-pentane in the manufacture of UNDP commercial trailers, vehicles, tourism vehicles and insulated trailers (REEFERS)

NATIONAL CO-ORDINATING AGENCY: LATEST REPORTED CONSUMPTION DATA FOR ODS ADDRESSED IN PROJECT A: ARTICLE-7 DATA (ODP TONNES) HHCCFFCCsss B: SECTORAL DATA (ODP TONNES, 2008)

ODS Name Subsector/quantity Subsector/quantity Subsector/quantity Subsector/quantity. HCFC-141b Foams: 56.1 (2010)

HCFC consumption remaining eligible for funding : not yet established CURRENT YEAR BUSINESS PLAN:

ODS USE AT ENTERPRISE 56.1 ODS t ODS TO BE PHASED OUT: 56.1 ODS t ODS TO BE PHASED IN 0 ODP t PROJECT DURATION: 36 Months PROJECT COSTS: Incremental Capital Cost US $ 498,000 Contingency (10%) on the requested grant US $ 49,800 Incremental Operating Cost (not eligible for funding) US $ 93,687 Total Project Cost US $ 547,800 LOCAL OWNERSHIP: 100 % EXPORT COMPONENT: 0 % REQUESTED GRANT: US $ 547,800 COST- EFFECTIVENESS: US$/kg ODP N/A US$/kg ODS 9,76

TOTAL COST OF PROJECT TO GEF: US $ 547,800 STATUS OF COUNTERPART FUNDING: Enterprise Commitment received PROJECT MONITORING MILESTONES INCLUDED: Included

PROJECT SUMMARY Under this project, MAZ Kupava will phase out the use of HCFC-141b in its production of insulated vehicles (REEFERS). The technology chosen is cyclo-pentane for the insulation foam. The company’s aim is to accelerate the phase-out of HCFC-141b foaming agent. IMPACT OF THE PROJECT ON COUNTRY’S MONTREAL PROTOCOL OBLIGATIONS: This project eliminates 56.1 t ODS which will contribute to the Belarus’s efforts to fulfill its commitment under the Montreal Protocol..

Prepared by: Risto Ojala Date: 08.11.2011

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1.0 PROJECT OBJECTIVE

The objective of this project is to phase-out the use of HCFC-141b in the manufacture of commercial trailers, vehicles, tourism vehicles and insulated trailers at MAZ Kupava and in this way contribute to Belarus’s compliance with the Montreal protocol HCFC consumption reduction requirements applicable to 2010 and 2015 targets (non Art 5 country’s obligation), and to do so such that it also will facilitate step-by-step elimination the use of high GWP HCFC-141b blowing agent.

2.0 SECTOR BACKGROUND

MAZ Kupava is the only PU foam manufacturing companies in Belarus.

3.0 ENTERPRISE BACKGROUND

Automobile trailers and bodies plant “MAZ-Kupava” Ltd (MAZ Kupava) was founded in 1990. The company is 100% local owned.

The enterprise started the production of traveler trailers in 1990 with Slovenian traveler trailer production technology. Presently MAZ Kupava manufactures more than 100 models and modifications of trailers and vans. Its annual PU foam production capacity is 550 tons. In 2009 and 2010, the foam production was 338 tons and 392 tons respectively, which consumed 55.8 tons and 56.1 tons of HCFC-141b respectively. 55% and 62% of the total production of the vehicles was exported to Russia, Ukraine and other neighboring countries in 2009 and 2010.

From 2009 to June 2011, the information of production of foam insulation panels and HCFC- 141b consumption by the company is below.

Table 1: Consumption of HCFC-141b.

Year Pre-blended Mass HCFC-141b in Total Polyol (ton) fraction of pre-blended Consumption of HCFC-141b polyol (ton) HCFC-141b in blended （ton） polyol (%) 2009 161 30% 55.8 20.36 2010 187 30% 56.1 30.04 2011 (first 6 102.9 30% 30.9 46.71 months)

Project site information:

Minsk, Babushkina Street, 14a; Industrial area Kolyadichi; industrial area – 5,200 m2

Address:

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18 Mashinostroitelej str, 220118 Minsk, Republic of Belarus http://www.maz-kupava.com Director General - Livshits Semen Borisovich Тel. +375 17 217 94 07 Fax. +375 17 242 98 83 [email protected]

Contact person for the project: Mr. Sergeev Pavel Evgenievich – Deputy Chief Engineer – Head of the Technical centre Теl. +375 17 217 91 73 Fax. +375 17 242 98 83 [email protected] The density of the rigid PU foams produced depends on the exact product and ranges between 39 and 55 kg/m³.

The production process is briefly described below.

Insulated trailer body parts fabrication:

Pre-painted Steel Sheet in roll is cut to size in thickness of 0.45 - 0.7 mm which is the basic raw- material for fabrication of outer and inner sheets of the sandwich panels used for the wall, roof and floor of the insulated vehicle parts.

Insulation /Foaming:

Inner sheets and outer sheets are positioned on the mowing assembly table of 3 meters in width and 14 meters in length, which is used as a mold for the sandwich panel manufacturing. The insulation space varies for different models from 25 to 150 mm. The maximum size of the sandwich panels to be manufactured is the said 3 meters x 14 meters. The actual size of the panels to be manufactured varies according to the insulated vehicle or trailer size. The press is preheated by means of hot water circulation. Later the assembly table/frame is loaded into the press. After selecting the desired program from the respective control panel, the required amount of material is laid-down by means of traversing movement of the mixing head in to the empty cavity of the wall / roof or floor panels subject to manufacturing by using high pressure PU Foaming Machine of Enersa HGM-300 MQ of capacity of 300 kg/min. The upper facing sheet in the press is kept in its position by means of vacuum through the upper press plate.

The photos below provide more of the process.

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Mixing head’s start and end position The press from the other end

Control board of the EnerSa unit Day tanks and pump units of the FM

Table 2: Basic production equipment.

Type of Model Serial Design Type Date of equipment number Capacity manufacture EnerSa HGM-300 N.A 300kg/min High pressure 2000 MQ One daylight EnerSa N.A 3 x 14 m Hydraulic 2000 press

Storage of raw materials Polyols, blended Polyols and MDI are stored in a warm warehouse nearby. The raw materials are supplied mainly by Dow, Basf and Huntsman. Foam Product specifications The size of polyurethane insulation panels according to different models required by the clients are from 25 mm in thickness up to 150 mm (in practice 120). The maximum size in width is 3 meters and in length 14 meters. Production capacity At present, the company can make 5 foamings / day. Working hours per day: 7 hours. Working days per year: 300 days.

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The production capacity per year: 5 panels x 300 days = 1,500 panels

4.0 PROJECT DESCRIPTION

MAZ Kupava intends to convert its foam operation from the current use of HCFC-141b to cyclo- pentane. The conversion plan includes:

The use of cyclo-pentane as an alternative-blowing agent for the insulation, which will result following changes:

1. The foaming reaction parameters will change. The change of mixing ratios will reduce the dispenser output and increase viscosities, which will reduce the flowability of the chemical mixture. 2. The miscibility of cyclo-pentane with polyol is significantly less than that of HCFC-141b. 3. Cyclo-pentane based foam will have a reduced thermal conductivity in relation to that produced with HCFC-141b. The impact on performance will be assessed to ensure that the present energy consumption is not increased. It is, however, assumed that the thickness of the insulation will remain as is. 4. Modifications to the plant and processes will have to be carried out to ensure safe operation (e.g. electrical installations meet area classification, ventilation, gas monitoring and other safety systems).

The impact on the foam production process due to the use of cyclo-pentane as an alternative blowing agent, as described above, would need to be addressed through plant modifications and through the installation and introduction of new equipment, components and processes, which are listed as below:

1. Cyclo-pentane of the required purity/grade is available through imports. A safe, reliable, convenient and economical storage, delivery and handling system for cyclo-pentane is required.

The drum storage facility, which is designed to be used with 1000 liter accumulator storage tank, the tank will be specially designed for storage of pentane, according to the physical and chemical properties of pentane. The tank shall be designed for the drum storage facility use. The supply shall also include all required flanges, pentane delivery pumps designed for explosive liquids and gas mixtures, explosion proof level gauges and controls (including current level control), saturators, safety valves, to avoid overfilling and over-pressure, remote operated valves etc. Prevention against static electricity must be installed. Velocity of liquid entering the tank should be reduced to max. 6 m/s in any case.

a. Delivery: Delivery of pentane can be accommodated by means of positive pressure of nitrogen in the accumulator tank or special designed pumps for cyclo-pentane will have to be installed, one operating and one standby. The electric drive motors are required to have explosion proof rating. b. Piping and fittings for carrying the cyclo-pentane from the storage tank to the pre-mixing unit. Also, piping and fittings for receipt of supply of cyclo-pentane, including gas return and pressure relief lines, will be required.

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2. As polyols cannot be delivered pre-blended with cyclo-pentane from the local polyol supplier, the existing arrangement for chemicals is not suitable for ensuring efficient and safe handling of cyclo-pentane in the polyol. A new pre-mixing station for handling of cyclo-pentane will need to be installed. a. Hydrocarbon sensor to be supplied as a package via safety panel. b. Electrical components are Ex-I (Intrinsically safe instruments and electrical barrier protection). c. Blended polyol tank with relief and safety valves, explosion proof level, magnetic-drive agitator and gas sensor.

3. The retrofitting of the existing sandwich panel production line has been examined. This would involve the following for enabling the dispenser to process the cyclo-pentane formulations: a. Replacement of EnerSa high pressure foaming unit for cyclo-pentane (max output 300 liters/min). The original foaming machine could not be converted into cyclo-pentane system equipment due to its age and software design. b. Install ventilation box for the foaming machine and premixing unit. c. Modification and provision of ventilation enclosure for the entire existing press to meet the requirements for the cyclo-pentane foaming. d. Move electrical parts out of the dangerous zone. Modify instruments to make it intrinsically safe. e. On request, control panels can be pressurized with dry air. f. Constant emissions of gaseous cyclo-pentane (CP) are present. Dilute the concentration (CP) into the external environment through the extract ventilation system. Monitor ventilation efficiency via differential pressure switch. Install gas sensors with 2 alarm system, warning at 20% LEL (Low Explosion Limit), emergency at 40% UEL (Upper Explosion Limit). Install enclosure. The aim is to define the zone so that any releases of flammable gas are contained within the enclosed area. g. Polyol tanks must have nitrogen blanketing for oxygen elimination. h. Properly earth all the metal parts. Metering units, mixing heads, fixtures must be properly grounded to a common earth to avoid electrostatic sparks. i. Re-installation of some of the high pressure and recirculation lines and components for safe operation. j. Introduction of explosion-proof electrical, in place of the existing ones consistent with the electrical classification of areas. k. Recalibration and additional trials.

4. Additional necessary changes: a. A water chilling unit with necessary controls, with capacity adequate to cover the cooling requirements for the pre-mixing buffer tank and component day tanks on the dispenser, and circulation pump. b. Interconnecting steel piping, valves, fittings and the necessary insulation for circulation of hot and cold water to the pre-mixing station, foam dispenser and press.

5. A ventilation and exhaust system for maintaining safe concentrations of cyclo-pentane will be required. This will involve sheet metal ducting and blowers/fans for supply of air as well as for exhaust of air extracted from the following vulnerable locations: a. The pre-mixing station area;

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b. The foam dispenser area and c. The sandwich panel foaming area and around the whole press

6. A safety system for detection and monitoring of cyclo-pentane concentrations and for prevention of fire and explosion hazards will be required. This will consist of the following: a. cyclo-pentane sensors/detectors (about 8 Nos. at assorted locations). b. Alarm and control system c. Water sprinkler system for fire extinguishing, covering the vulnerable areas and about 15 portable fire extinguishers for areas unsegregated from the vulnerable areas. d. A nitrogen system for blanketing the pentane tanks, premixer tank and polyol work tank. A packaged nitrogen generating plant is recommended, meeting the capacity required for the existing production lines. e. Anti-static flooring for the vulnerable areas amounting to about around 100 sq. m.

7. Electrical works for the conversion complying with safety regulations pertaining to areas handling flammable/explosive substances, will be required, covering the following: a. A main control panel and local distribution panels for the new electrical equipment (cyclo-pentane pump motors, pre-mixing station pump motors, dispenser pump motors, water pumps motors, fan motors, compressor motor, etc.) b. Power cabling, earthing and terminations. c. Control and interlocking wiring for the safety systems. d. Back-up AC electric power (EPS) covering the requirements of the ventilation, fire extinguishing, alarm and nitrogen systems.

8. Civil and miscellaneous works will be required covering the following: a. Cyclo-pentane storage facility foundations and housing. b. Miscellaneous civil works for pipe/duct/cable support installation, making and refinishing wall/floor openings, floor finishing, relocation of the dispenser, supports/foundations for installation of new equipment, etc.

9. Technical assistance from the equipment suppliers (or other external foam experts), to implement the new formulations and to ensure smooth transition to the new technology, will be needed.

10. Trials will be needed for validation of the new formulations and the new equipment. This will cover the cost of chemicals, raw materials/consumables and utilities required during the trials and commissioning.

11. On commissioning the plant, a safety audit will be required and be carried out and the plant will need to provide safety certificates issued by a competent authority through inspection.

13. The production personnel in the enterprises will be required to be trained by equipment suppliers to be able to work with the new formulations. Additionally, training for establishing safe practices in handling flammable/explosive cyclo-pentane will be required and provided by the chemical supplier. Such training will either be secured from specialized agencies (the suppliers) or through pre-trained officials of the enterprise.

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These changes will also result in incremental operating costs. Incremental operating costs originate from the following:

1. The cost of polyol for cyclo-pentane is higher than for HCFC-141b, resulting in increased consumption of polyurethane chemicals. 2. There would also be additional increased operating costs on amount of increased electricity consumption (due to the introduction of new equipment such as cyclo- pentane pumps, ventilation fans/blowers, water pumps, etc.), increased maintenance costs and increased insurance costs.

The ExCom’s guidance on HC safety (UNEP/Ozl.pro/ExCom/25/54) will be adhered to as much as possible.

5.0 TECHNOLOGY OVERVIEW AND SELECTION FOR REPLACEMENT OF HCFC-141B IN THE MANUFACTURE OF COMMERCIAL REFRIGERATORS AND SANDWICH PANELS

5.1 INTRODUCTION

To replace HCFCs in the production of PU insulation foams, following criteria ideally would apply:

A suitable boiling point with 250C being the Soluble in the formulation, target, Low diffusion rate, Low thermal conductivity in the vapor phase, Based on validated technology, Non flammable, Commercially available, Low toxicity, Acceptable in processing, Zero ODP, Economically viable. Low GWP, Chemically/physically stable,

No current replacement technology meets all of these criteria and compromises will be necessary. The actual choice will be impacted under others, by application, technical proficiency, plant layout and—investment as well as operating—costs. In the case of domestic refrigerators, maintaining product density and insulation value are of crucial importance and limit the choice to the technologies discussed below.

5.2 ALTERNATIVES

Following is a list of the main alternatives—validated, under validation or still under development—to replace HCFCs in rigid insulation foams. The molecular weight is mentioned as an indication of blowing efficiency and the incremental GWP as an indication how the technology performs compared to HCFC-141b on this environmental parameter:

MOLECULAR INCREMENTAL SUBSTANCE GWP1 COMMENTS WEIGHT GWP2 HCFC-141b 725 117 Baseline

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Used direct/indirect CO2 1 44 -725 (from water) Extremely Cyclopentane Negligible 72 -718 flammable HFC-245fa 1,030 134 443 HFC-365mfc 794 148 279 HFC-134a 1,430 102 522 Methyl Negligible 60 -725 formate Reported for co- Methylal Negligible 76 -725 blowing only Used in flexible Acetone Negligible 58 -725 slabstock FEA-1100 5 1644 -718 Under development HFO-1234ze 6 114 -719 Recently introduced HBA-2 <15 <134 >-708 Under development AFA-L1 <15 <134 >-708 Under development 1 Unless otherwise indicated, taken from IPCC’s Fourth Assessment (2007) 2 Derived from comparing GWPs compared to the baseline on an equimolar base. It should be noted that in practice formulators may make changes such as increased water or ABA blends that impact the global warming effect 4 Calculated from published formulations Green = beneficial GWP effect; red = unfavorable GWP effect These technologies are described in more detail below.

CARBON DIOXIDE - The use of carbon dioxide derived from the water/isocyanate chemical reaction is well researched. It is used as base blowing agent in almost all PU foam applications and as sole blowing agent in many foam applications that have no/ minor thermal insulation requirements. The relatively emissive nature of CO2 in closed-cell foam is, however, a challenge. To avoid shrinkage, densities need to be relatively high which has a detrimental effect on the operating costs up and above mitigating poor insulation values. Increased use of water/CO2 has been—and still is—an important tool in the HCFC phaseout. There is no technological barrier. However, the use of water/CO2 alone will at this time be limited to foams such as integral skin foams (with restrictions when friability is an issue), open cell rigid foams, and spray/in situ foams for non/low thermal insulation applications.

Some chemical manufacturers have proposed enhancing water based systems through the addition of formic acid under strictly controlled conditions (the reaction of MDI with formic acid creates equal amounts of CO2 and CO, with the latter being toxic).

Carbon dioxide can also be added directly as a physical blowing agent through the use of super- critical CO2. The reported finer cell structure would improve the otherwise poor insulation value. UNDP is in the process of assessing this option for MLF projects.

HYDROCARBONS (HCs) - There have been many HC-based/MLF-supported CFC-phaseout projects in refrigeration and in panel applications. The minimum economic size has been historically ~50 ODP t/y or US$ 400,000 US$ with (higher cost) exceptions for domestic refrigeration. Smaller projects were discouraged for reasons of cost and technological

86 Belarus Refrigerant Management Plan complexity. Consequently, there is hardly any use of HCs in SMEs. In addition, the technology was deemed unsafe for a multiple of applications such as spray and in situ foams. Generally, cyclopentane has been used for refrigeration and n-pentane for panels. Fine tuning through HC blends (cyclo/iso pentane or cyclopentane/isobutane) is are now standard in non-A5 countries is not widely spread in A5’s. Consequently, the investment costs are the same as at the time of phasing out CFCs and the technology will continue to be too expensive for SMEs and restricted to the same applications as before. There are, however, options to fine-tune project costs and investigate other applications:

The introduction of HC blends that will allow lower densities (lower IOCs) Addition of methylal to decrease cell size and improve insulation value (better performance) Direct injection (lower investment) Low-pressure/direct injection (lower investment) Centralized preblending by system houses (lower investment) Application-specific dispensing equipment (lower investment)

UNDP has initiated a study of these options with the goal to decrease the minimum economic size to ~25 t/y or US$ 200,000. Although this goal has not yet been achieved, the study shows encouraging results for centralized preblending as well as direct injection. Complete results are expected around for the 65th ExCom in November 2011.

Hydrofluorocarbons (HFCs) - Current HFC use in A5 countries is relatively insignificant. The low cost of HCFC-141b is just too compelling! These chemicals have, however, played a major role in the replacement of HCFCs in foam applications in non-A5 countries, despite their high GWP potentials. Formulations are frequently not straightforward molecular replacements. Generally, the use of water has been maximized and sometimes other co-blowing agents have been added. Therefore, an assessment of its environmental impact has to be based on actual, validated, commercial blends. There are currently three HFCs used in foam applications. Following table includes their main physical properties:

Parameter HFC-134a HFC-245fa HFC- 365mfc Chemical Formula CH2FCF3 CF3CH2CHF2 CF3CH2CF2CH3 Molecular Weight 102 134 148 Boiling point (0C) -26.2 15.3 40.2 Gas Conductivity (mWm0K at 10 12.4 12.0 (20 0C) 10.6 (25 0C) 0C) Flammable limits in Air (vol. %) None None 3.6-13.3 TLV or OEL (ppm) 1,000 300 Not established GWP (100 y) 1,410 1,020 782 ODP 0 0 0

METHYL FORMATE (MF) - also called methyl-methanoate, is a low molecular weight chemical substance that can be used as a blowing agent for foams. Following data on physical properties have been reported:

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Property Methyl Formate HCFC-141b Appearance Clear liquid Clear liquid Boiling point 31.3 oC 32 oC LEL/UEL 5-23 % 7.6-17.7 Vapor pressure 586 mm Hg @ 25 oC 593 mm Hg @ 25 oC Lambda, gas 10.7 mW/m.k @ 25 oC 10.0 mW/m.k @ 25 oC Auto ignition >450 oC >200 oC Specific gravity 0.982 1.24 Molecular weight 60 117 GWP 0 630 100 ppm TWA/150 ppm STEL 500 ppm TWA/500 ppm TLV (USA) STEL

In the USA, MF is not treated as a volatile organic component (not a smog generator) and is SNAP (USEPA’s Significant Mew Alternatives Program) approved. In Europe it is compliant with the RoHS (Restriction on Hazardous Substances) and WEEE (Waste Electrical and Electronic Equipment) directives. Acute toxicity is reported low with no special hazards. The MSDS mentions R12 (extremely flammable but not explosive); R20/22 (harmful by inhalation and if swallowed) and R36/37 (irritating to eyes and respiratory system). UNDP reports show process emissions to be much lower than 100 ppm (which is the STEL and TWA). Therefore no special precautions for MF blends in the manufacturing area are required. MF is normally sold as a system, which would allow restricting flammability issues to the supplier. Shipping of systems in the USA is possible without red (“flammable”) tags. The ExCom reviewed the outcome of two pilot projects to assess the use of methyl formate in all potential applications and recommended that countries will include this technology in their choices of HCFC replacement technologies.

METHYLAL (ML) – Methylal’s primary use is as a solvent. It is soluble in water and miscible with most common organic solvents. The use of Methylal as a co-blowing agent in conjunction with hydrocarbons and HFCs for rigid PU foam applications (domestic refrigeration, panels, pipe insulation and spray) has been described in the literature. It is claimed to improve the miscibility of pentane, promotes blending in the mixing head, foam uniformity, flow, adhesion to metal surfaces and insulation properties. The addition of a low percentage of Methylal to HFCs (245fa, 365mfc or 134a) makes it reportedly possible to prepare pre-blends with polyols of low flammability with no detrimental effect on the fire performance of the foam. Despite all literature references, public knowledge of Methylal’s industrial performance as blowing agent is limited. To alleviate this, the ExCom approved in July 2009 a UNDP pilot project to assess its use as a possible replacement of HCFCs for MLF projects in developing countries. The assessment in integral skin/microcellular foams is already completed and resulted in safe (flammability, toxicity) blends that create excellent foams compared with HCFC-141b. The assessment in rigid PU applications is ongoing.

Property Methylal HCFC-141b Appearance Clear liquid Clear liquid Boiling point 42 oC 32 oC LEL/UEL 2.2-19.9 % 7.6-17.7

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Vapor pressure 400 mm Hg @ 20 oC 593 mm Hg @ 25 oC Lambda, gas Non available 10.0 mW/m.k @ 25 oC Auto ignition 235 oC >200 oC Specific gravity 0.821 @ 20 oC 1.24 Molecular weight 76.09 117 GWP Negligible 630 1000 ppm TWA 500 ppm TWA/500 ppm TLV (USA) STEL

EMERGING TECHNOLOGIES - Since early 2008, a flood of new blowing agents for PU foams have been proposed by major international manufacturers of halogenated compounds. Four of them are worth mentioning:

HFO- HBA-2 FEA-1100 AFA-L1 1234ze Chemical Formula CHF=CHF3 n/k n/k n/k Molecular Weight 114 <134 161-165 <134 Boiling point (0C) -19 >15 <32 >25 >10 <30 Gas Conductivity (mWm0K at 13 n/k 10.7 10 10 0C) Flammable limits in Air (vol. None None None None %) TLV or OEL (ppm; USA) 1,000 n/k n/k n/k GWP (100 y) 6 <15 5 Negligible ODP 0 0 0 0 Manufacturer Honeywell Honeywell DuPont Arkema

These technologies are all geared towards replacement of HFCs and sometimes called “second generation” or “unsaturated” HFCs, although the name HFOs (hydrofluoroolefins) appears to be a more distinctive description. They share low/no flammability, zero ODP and insignificant GWPs:

Except HFO-1234ze, all these substances still are in the process of toxicity and application testing and will therefore not appear in the market in commercial quantities before around 2015.

5.3 SELECTION

MAZ-Kupava selected cyclo-pentane as potential HCFC replacement candidates as

 Water-based technology does not perform well on cost, density and insulation value;  HFCs are too expensive in operating costs and have too high GWPs;  Trials showed that methyl formate is not yet ready for their kind refrigeration applications.

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6.0 PROJECT COSTS

6.1 CALCULATION OF INCREMENTAL CAPITAL COST

The GEF investment costs are US$ 547,800. This includes a 10% contingency for items to be funded by GEF. Details of incremental capital costs are provided in Annex-1.

6.2 CALCULATION OF INCREMENTAL OPERATING COST

Incremental Operating Costs are US$ 93,687 for one year operation. The calculation is detailed in Annex-2. Incremental operating costs are not eligible for funding, and thus, this expense will be borne by the beneficiary company MAZ Kupava.

6.3 COST EFFECTIVENESS (CE) (Phased-out US$ / HCFC kgs/a)

Cost-effectiveness is calculated based on the actual capital cost of the proposed grant (See para 6.4). CE is US$ 547,800/56,100 kgs HCFC 141b = US$9.76/kg

6.4 PROPOSED GEF FUND GRANT

The proposed grant request, which is calculated according to the Montreal Protocol Executive Committee Decision 55/47 - Guide for Costing, totaling US$ 547,800, and representing 20% of investment cost US$ 2,715,000 from the side of MAZ-Kupava. MAZ-Kupava has provided a formal co-finance commitment letter.

7.0 PROJECT IMPLEMENTATION AND MONITORING

The project will be implemented using UNDP’s National Execution Modality. Implementation is targeted as follows:

Activity (per quarter) 1 2 3 4 5 6 7 8 9 1 1 1 0 1 2 MF Project approval X Submit Project doc. for X signature Project document signature X Equipment specification X Equipment procurement X X Installation of equipment X X Training X Testing and trials X Production Start-up X X Phase-In X X Project completed X HOP signature X

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MILESTONES FOR PROJECT MONITORING (measured from project approval)

TASK MONTH (a) Project document submitted to beneficiary 2 (b) Project document signature 3 (c) Bids prepared and requested 4 (d) Contracts Awarded 6 (e) Equipment Delivered 15 (f) Training Testing and Trial Runs 21 (g) Commissioning 32 (h) HOP signature 36

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7PROJECT IMPACT

Direct Benefits: This project will eliminate the use of 56.1 metric tonnes HCFC-141b, at baseline conditions. The project employs commercially available and environmentally superior technology effectively anticipating future control measures and addressing issues related to climate change impacts. The project also provides a key element of Belarus’s HCFC phase out strategy as being developed in its HPMP to meet HCFC reduction steps in 2015 and onwards.

Indirect Benefits: The new technology will allow Maz Kupava to retain and expand its competitive position and serve as a demonstration of accelerated adoption of low GWP technology in a smaller scale regional producer of commercial refrigeration equipment similar to that which exists in many Article 5 countries as well as Article 2 CEITs in the immediate region.

Furthermore, early conversion of this company will reduce the rate of increase in the banks of HCFC-141b based foams in the country thereby reducing future emissions of HCFCs into the atmosphere or “end of life” environmentally sound disposal costs.

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CALCULATION OF INCREMENTAL CAPITAL COSTS

Pos Item In US$ Counterpart funding (In US$) 1 Pentane drum storage facility 32,000 2 Premixing unit facility 85,000 3 Replacement of EnerSa 300 kg/min by means of High 230,000 Pressure foaming machine of similar capacity 4 Modification of existing press 150,000 5 Modification of PU feeding 5,000 6 Modification of assembly table 60,000 Plant Safety 7 Exhaust ventilation at the foaming area 6,000 8 Exhaust ventilation from around and underneath the 45,000 press and provision of enclosure around the entire press 9 Gas detection system for the press area, premixer, 18,000 foaming machine and pentane storage 10 Safety management system and connection to the gas 25,000 detection system 11 Fire protection & sprinklers 12,000 12 Antistatic floor 5,000 13 Electrical grounding and other electrical safeguarding 20,000 of all relevant equipment 16 Nitrogen generator 40,000 17 Standby electric generator 15,000 18 Safety Audit 15,000 General 19 Development and approval of civil works and project 100,000 documentation in accordance with national industrial and safety standards 20 Civil works (local preparations, land excavation, soil 500,000 transportation, ducting for polyol supply, steel/mineral wool insulation, ventilation enclosures, building modifications, other outside infrastructure) 20 Technology transfer 30,000 21 Trials and commissioning 20,000 Sub-total 498,000 915,000 22 Contingency 10% 49,800 - Total 547,800 915,000

In-cash (GEF grant): US$ 547,800

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In-cash, parallel financing - (MAZ Kupava): US$ 915,000 In-kind (MAZ Kupava): US$ 300,000 (regular training of personnel in equipment use and safety procedures; monitoring of equipment performance and maintenance/repairs as required, PR campaigns on the use of ozone- and climate friendly technology in products after the conversion) Add-on (MAZ Kupava): US$ 1,500,000 (general upgrade and improvements of the building where the technology is located)

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CALCULATION OF INCREMENTAL OPERATING COSTS

Foaming HCFC Cyclo- HFC Water Technology -141b pentan e Blowing agents 1.9 1.99 10 na Polyols 2.14 2.45 2.45 2.22 (without blowing agent) MDI 2.96 2.96 2.96 2.96

HCFC-141b Cyclo-pentane HFC-245fa Water system system system system foam Parts Price Parts Price Parts Price Parts Price Item (kg) (US$) (kg) (US$) (kg) (US$) (kg) (US$) Polyols (without blowing agent) 100 214 100 245 100 245 100 222 HCFC-141b 30 57 Cyclo-pentane 12 23.88 HFC-245fa 25 250 MDI 121.5 359.64 135 399.6 132.5 392.2 155 458.8 Subtotal 251.5 630.64 247 668.48 257.5 887.2 255 680.8 Foam usage 1 1 1 1.1 Foaming Price ($/kg) 2.51 2.71 3.45 2.94 Ratio of HCFC- 141b in the row material 0.119 0.049 IOC (US$/kgHCFC- 141b) 1.67 7.86 3.60 56,100 kg x Total HCFC- USD1.67/kg = 141b phase out 93,687

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ENVIRONMENTAL ASSESSMENT

Impact on the Environment based on CDM methodology

Name of Industry M CO2-eq (M Substance GWP tonnes/ tonnes/year) year Before Conversion

Rigid PU Foam HCFC 630 56.1 35,343 141b Total CO2 emission in MT 35,343

After conversion to c-pentane in the rigid PU insulation

Rigid PU Foam c-pentane 25 22.4 560

Total CO2 emission in 560 MT Net Impact from 34,783 conversion

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Annex 5. Atlant/David Gorodok Solvent Conversion Project (for “Atlant”)

THE MONTREAL PROTOCOL ON SUBSTANCES THAT DEPLETE THE OZONE LAYER

PROJECT COVER SHEET

COUNTRY: Belarus

PROJECT TITLE: Elimination of ODS (HCFC 141b ) used in the Production Line at Atlant/David-Gorodok Electromechanical Plant (for “Atlant”).

SECTOR COVERED: Solvent

ODS USE IN SECTOR: 7.33 t (ODS) of HCFC 141b solvent projected use in 2010 and growing

PROJECT IMPACT: Eliminate 7.33t/y (2010 data) of HCFC-141b

PROJECT DURATION: 2 years from the date when grant is in place

TOTAL PROJECT COST: Capital Cost: US$ 158,400 Incremental Operating Cost: US$ 66,07318 Contingency: US$ 17,600 Total Cost: US$ 176,000

COST EFFECTIVENESS: US$ 24/kg of HCFC-141b (GEF grant)

IMPLEMENTING AGENCY: UNDP

PROJECT SUMMARY

This project will phase out HCFC-141b used to clean metal parts and assemblies at the David- Gorodok Electromechanical Plant.

Replacement of ODS cleaning positions in the production processes will be accomplished by replacing the current cleaning methods with vapor degreasing units and using an alternative solvent.

Prepared by: Steve Cook

18 Covered by enterprise

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1. PROJECT OBJECTIVE

The objective of this project is to eliminate the use of 7.33 MT (2010 data) HCFC-141b in assembling/manufacturing processes at the David-Gorodok Electromechanical Plant manufacturing protection relay parts for the household fridge manufacturing plant Atlant (through its machine building branch at Baranovichi plant).

2. SECTOR BACKGROUND

This is the only application of solvents identified in the country.

HCFC-141b, being ODS with highest ODP among HCFC group of chemicals, requires that HCFC consumption in this sector be reduced as soon as possible, which is in conformance to the strategy that employs a focused, simultaneous approach on both the large scale users and the small and mid-sized users. This is technologically feasible since alternative processes exist.

3 ENTERPRISE BACKGROUND

The plant is located at No.68 Kalinina Str., David-Gorodok, 225540, in the Republic of Belarus, and the company employees over 500 people. The company produces electrical relays for refrigeration valves as their sole product. The company was founded in 1988. Their annual usage of HCFC 141b increased by 50% over the past four years.

Main data of the factory is as follows:

The production output in 2008 was 2,474 units; Projected total number of units produced in 2011 is 5,093

The application of HCFC-141b at the Atlant factory for degreasing of metal parts and compressors spares and inlets started with the purchase of used manufacturing machinery in 1995. After 10 years operation with the equipment installed at Atlant in the capital city and due to emissive use of HCFC-141b, it was decided to relocate the operations to Atlant’s branch called Baranovichi machine-building factory in 2007 (western part of the country). This factory then in line with the Government programme to support the development of small towns and industries has leased the equipment out to a sub-contractor plant in David-Gorodok town – David-Gorodok Electromechanical Plant. The equipment was handed over on the conditions of lease, and the owner has been kept to be the Baranovichi machine-building factory – a branch of Atlant starting from 2005. The company is economically stable, has prospects of development and is ready to take part and cofinance the project on HCFC phasing out.

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The company is 100% Belorussian.

4 PROJECT DESCRIPTION

4.1 Process Soils

The cleaning processes used at the The David-Gorodok factory are designed to clean the start-up and protection relays for refrigeration and freezers manufactured at the factory “Atlant”.

The main soils removed from the miscellaneous parts are primarily the coolant used for metal cutting, steel chips and dirt.

4.2 Present Process

Cleaning process

The David-Gorodok Electromechanical Plant currently cleans eight (8) different parts. All of these parts must be critically clean as they are spot welded after cleaning. The welding process is an electrical impulse spot weld. This weld is so finite that requires the parts be critically clean or the weld will not adhere. Using this manufacturing process on an experimental basis is how they determined that certain DuPont, and Solvay blends were inefficient cleaners. Neither of the products cleaned as efficiently as 100% HCFC 141b.

All products are purchased so the actual contaminants are not known. Upon inspection both visually and physically it was determined that the contamination was a light duty cutting fluid.

All of the products cleaned are metal as they do not clean any plastic parts. The metal being cleaned is:

 Steel coated with a silver alloy  Brass  Copper  Soft steel

All parts are being cleaned at one central location. The setup at this location is:

 Two ultrasonic cleaners.  Two vent hoods; one over each ultrasonic cleaner.  One chemical scrubber as the vapor phase of the solvent that is pulled up through the vent hoods go through a chemical filter to capture any solvent prior to being ventilated into the atmosphere.  Two drums of solvent: o One new o One reclaimed

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 New clean white napkins for cleanliness testing upon removing the parts from the ultrasonic cleaner.  Various size baskets for placement of the contaminated parts.  Various size baskets for placement of the clean parts.

This entire cleaning setup was purchased as one unit from SANYO in 1994.

The parts cleaning process is:

 All parts are cleaned using an ultrasonic unit.  The metal parts are placed in a basket that is the appropriate size for the ultrasonic unit.  The basket is then placed into the ultrasonic unit tank.  The ultrasonic unit is then filled with the cleaning solvent. o One liter of spent solvent and one liter of virgin solvent o 100% reclaim leaves slight residue  The lid is then placed on the ultrasonic unit to limit solvent loss in the vapor phase.  The ultrasonic unit is then turned on and ran for a fifteen minute cycle.  Upon completion of the cycle the basket is lifted out of the solution and the excess solvent is shaken off allowing it to fall back into the solvent tank.  The parts are then transferred to a second larger basket and spread out.  The parts are then checked for cleanliness both visually and manually by rubbing the parts with a clean white “napkin” and visually inspecting for residue.  The parts are then placed in an oven (at an offsite location) and dried at 55°C for 15 minutes.  The solvent is changed out when it is discolored or when it no longer cleans efficiently (usually after two to three cycles). Both tests are visual inspection.

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4.3 Proposed Alternative Process

 The equipment will be changed to vapor degreasing low emission machines. The parts can go through a process of dip into hot ultrasonic solvent---raise and hold in vapor space surrounded by cooling coils where the vapor condenses on the piece(s) to be cleaned-- move into vapor free zone where the piece(s) dries, and finally exits with little carry-out (primarily vapor).  Install proper ventilation systems, vent hoods, for the cleaning process to limit the chemical exposure that the workers are being subjected to.  Install a fixed bed adsorbing unit in line with the ventilation system.  Recycle, via distillation, the solvent once it no longer cleans sufficiently.  One distillation unit can serve the entire facility. The unit can be centrally located for increased efficiency. As this is a closed loop system no excess ventilating systems are required. o The solvent can be decanted into an appropriate vessel and transferred to the distillation unit. o Upon distillation and reclamation the recycled solvent may be used. o Periodically check the solvent for acidity before returning it to the process  Use either virgin or a blend of the recycled and virgin solvent. These parts have to be critically clean, so this can only be determined experimentally.

5 TECHNOLOGY PROPOSAL

The desired solvent characteristics as defined by The David-Gorodok Electromechanical Plant at the factory Atlant are:

 Cost needs to be close to HCFC 141b.

 The second criterion is that the solvent would be nonflammable.

 A third would be relatively low toxicity; time weighted average (TWA).

 A fourth requirement is that it has to clean as good as or better than 141b for the aforementioned reasons. The ideal product would be a better cleaner than 141b in a shorter time.

 A fifth requirement is that the cleaning solution cannot react with any of the metals being cleaned.

 A sixth, no ozone depletion potential. This is particularly important because HCFC-141b is being phased out because it has an ODP value of 0.11. The ideal replacement should have a minimal potential to avoid future government intervention and negative ecological impact.

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 A seventh requirement of the cleaning solution is that it has to have an evaporation rate closer to 141b than to other products. They stated that each employee is required to produce 10,000 parts per day with 20 working days in a month.

 The eighth requirement is the solvent must have a low enough surface tension to efficiency clean all of parts. Although there are only four different metals there are eight different parts designs being cleaned. Some parts have very little space around the components leaving little room for the solvent to penetrate for effective cleaning.

 A ninth criterion would be a solvent that is classified as a low VOC. A Volatile Organic Compound (VOC) is any volatile compound of carbon, excluding carbon monoxide, methane, carbon dioxide, carbonic acid, ammonium carbonate, metallic carbides or carbonates, and exempt compounds. VOC’s and the secondary photochemical oxidant products have a potential to cause damage to the environment and human health.

 A tenth criterion is a solvent with a low Global Warming Potential (GWP). This is how much a given mass of a chemical contributes to global warming over a given time period compared to the same mass of carbon dioxide. All GWP values shown are calculated over a 100-year time horizon. As CO2 is the standard it is assigned a value of 1, and water is assigned a value of 0. Most Hydro fluorocarbons (HFC) and Hydro chlorofluorocarbons (HCFC) have GWP’s ranging from 93 to 12,100.

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HCFC 141b Relative Comparison

Criteria Solvent 141b Trans HCFC Vertrel nPB TCE Hydro- (Pure or Blend AK225 KCD- carbon Blend) 9587

Cost (relative - Higher Much Slightly Slightly Lower Lower 1 to 141b) Higher Higher Higher Non 2 Flammable √ √ √ √ √ √ X Toxicity 3 TWA (ppm) 500 200 50 200 25 100 50 Cleaning Efficiency 1* 1.32 0.70 0.65 1.36** 1.34** 1.35 4 Relative to 141b Metal 5 compatibility √ √ √ √ √ √ √ 6 ODP 0.11 0 0.03 0 0.006 0 0 Relative 7 Evaporation 0.27 0.44 0.31 0.19 0.6 1 2.04 Rate <=TCE Surface 8 Tension 18.4 21.8 16.2 14.1 25.9 29.5 28 9 VOC content Exempt 1024 Exempt 446 1330 1462 690 10 GWP 630 790 370 1500 0 0 0

*141b given a cleaning value of 1 ** Suspected carcinogen

Globally, the primary solvent that has been used to replace HCFC 141b for general cleaning is Trans-1, 2- Dichloroethylene (Trans). The VOC and GWP values for Trans blends are slightly higher than HCFC 141b. Control measures can be put into place to offset these differences. Other solvents exists that have the same cleaning efficiency are all suspected carcinogens (**). Therefore, the latter group will not be a recommended replacement. The recommended solvent replacement for general cleaning will be a Tran’s blend. Solvents that could be tested for general cleaning are the following blends containing Tran, for instance, are: Vertrel SFR; SDG; SMT; MCA; MCA plus; 71DA, and 71DE. One hundred percent (100%) of Trans-1, 2- Dichloroethylene is flammable; however, all recommended Trans blends are not. Nor will they become flammable with extended use. The permissible exposure level of 1, 2- Transdichloroethylene is lower than that of HCFC 141b; however, the volatility of Trans is less than that HCFC 141b. Low emission vapor degreasing units will be used. These systems are designed with cooling coils in the upper side walls, and ends to depress any escaping vapor.

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Secondly the lids fit tightly on the machines allowing no vapor release when the machine is in use. A third safety control will be ventilation systems, vent hoods, above the units. Each ventilation system will eventually exhaust into the atmosphere. These additional control measures will offset the lower permissible exposure level of Trans based products.

The VOC and GWP values for Trans blends are slightly higher than HCFC 141b. Operational controls such as the fixed bed adsorbing units (activated charcoal beds) can be put in line with the exhaust ducts to capture any vapor emissions preventing any chemical vapor release prior to venting into the atmosphere.

The equipment will be changed to low emission machines. The parts can go through a process of dip into hot ultrasonic solvent---raise and hold in vapor space surrounded by cooling coils where the vapor condenses on the piece(s) to be cleaned--move into vapor free zone where the piece dries, and finally exits with little carry-out. This will compensate for the increased VOC and GWP values of the Trans blends.

In addition to the training of the operators, the site should also be prepared and modified. At each cleaning cell extra space will be needed for the vapor degreasing unit, and the ventilation systems.

6 PROJECT COSTS

6.1 Total Project Costs

As described below and presented in detail in the relevant annexes, the total project cost is US$ 176,000 and has been calculated as the financial capital cost.

6.1a Capital Costs:

As detailed in Annex 1, total investment cost is US$ 176,000 including contingencies.

6.1b Incremental Operating costs:

A net incremental operating cost is US$ 66,073 (as detailed in Appendix 2). Company will cover these costs of new materials as a contribution to the project to leverage additional co-finance.

6.1c Contingencies

Contingencies are estimated at 10% of the subtotal cost for all goods and services and represent US$ 17,600. This amount is included to ensure that the project receives the necessary funding due to escalation, and in case unforeseen costs arise.

7. PROJECT IMPACT

This project will eliminate 7.3 MT of HCFC-141b/year (2010 data) at the David-Gorodok Electromechanical Plant.

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8. ENVIRONMENTAL IMPACT

Under the current proposal the David-Gorodok Electromechanical Plant will use non-ODS depleting processes including vapor degreasing cleaning process to replace their current ODS emitting process. The cleaning process will include low emission machines where parts can go through a process of dip into hot ultrasonic solvent---raise and hold in vapor space surrounded by cooling coils where the vapor condenses on the piece(s) to be cleaned--move into vapor free zone where the piece dries, and finally exits with little carry-out. The factory will provide proper provisions of exhaust, and will have to obtain the applicable permits required by the Government to ensure that the operation of the new equipment conforms to regulations.

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9. IMPLEMENTATION SCHEDULE

The project will be implemented using UNDP’s National Execution Modality. Implementation is targeted as follows:

Activity (per quarter) 1 2 3 4 5 6 7 8 9 1 1 1 0 1 2 Project approval X Submit Project doc. for X signature Project document signature X Testing of Alternatives X X Equipment and process X specification Equipment procurement X X Installation of equipment X Training X Testing and trials X Production Start-up X X Phase-In X X Project completed X HOP signature X

10. MILESTONES FOR PROJECT MONITORING (measured from project approval)

TASK MONTH (a) Project document submitted to beneficiary 2 (b) Project document signature 3 (c) Testing of alternatives 5 (d) Bids prepared and requested 7 (e) Contracts Awarded 10 (f) Equipment Delivered 16 (g) Training Testing and Trial Runs 18 (h) Commissioning 19 (i) HOP signature 21

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CALCULATION OF INCREMENTAL CAPITAL COSTS

Pos Item In US$ Counterpart co- funding (In US$) Equipment 1 2 Vapor Degreasing Units 70,000 2 1 Distillation Unit for Reclamation 40,000 3 2 Fixed Bed Adsorbing Unit 10,000 Plant Safety 4 2 Ventilation Hoods and Ducting 10,000 5 Plant safety 60,000 6 Safety Audit 10,000 General 7 Development and approval of civil works and project 100,000 documentation in accordance with national industrial and safety standards 8 Civil works (local preparations, upgrade of storage area 363,927 for new chemical, safety signs and trainings for personnel, PPE, installation of ducting, building/site modifications, other outside infrastructure, equipment maintenance) 9 Technology transfer 18,400 10 Trials and commissioning 10,000 Sub-total 158,400 11 Contingency 10% 17,600 Total capital 176,000 533,927 Operating costs 66,073 Total 176,000 600,000

In-cash (GEF grant): US$ 176,000 In-cash (Atlant for internal modernization as described and for the new chemical): US$ 600,000

BREAKDOWN OF INCREMENTAL OPERATING COSTS

ITEM Costs

Solvent Costs 7,330 kg/yr 141b ($1.9/kg) $13,927 2,000 kg/yr Trans ($40/kg) $80,000

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TOTAL PRE-PROJECT COSTS PER YEAR: $13,927

TOTAL POST PROJECT COSTS PER YEAR: $80,000

TOTAL ANNUAL INCREMENTAL COST: $66,073

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Annex 6. Provision of UNDP country office support services in implementation of the project “Initial Implementation of Accelerated HCFC Phase Out in the CEIT Region”

The UNDP country office may provide at the request of the Ministry of Natural Resources and Environmental Protection of Belarus the following Implementation Support Services (ISS) for the activities of the project:

 Payments, disbursements and other financial transactions  Recruitment of project personnel and consultants  Procurement of goods and services  Organization of training activities, conferences and workshops

The support services provided by the UNDP country office shall be in accordance with the UNDP regulations, rules, policies and procedures. Direct project costs incurred with regards to UNDP support services are to be recovered to UNDP.

Pursuant to the relevant provisions of the Standard Basic Assistance Agreement (SBAA) between the Government of Belarus and UNDP, signed on 24 September 1992, and provisions of the project document, the provisions on liability and privileges and immunities shall apply. The Government shall retain overall responsibility for the nationally managed project through its Executing Entity. The responsibility of the UNDP country office for the provision of the support to the Executing Entity shall be limited to the services detailed in the table below.

Any claim or dispute arising under or in connection with the provision of support by the UNDP country office shall be handled pursuant to the relevant provisions of the SBAA.

In accordance with the provisions of the project document “Initial Implementation of Accelerated HCFC Phase Out in the CEIT Region”, the UNDP country office shall provide support at the request of the Ministry of Natural Resources and Environmental Protection of Belarus as described in the table below. Cost-recovery by UNDP country office for direct project costs shall be funded from the project budget using the following method:

Fee based ISS method, when UNDP Country Office charges the project for provided services based on number of transactions and transaction fee in accordance with the country office pricelist.

Schedule for the provision of ISS, cost and method are described in the table below. Schedule for the Cost to UNDP of providing such Amount and method of Support Services provision of the support services (where reimbursement of UNDP (where support services appropriate) appropriate) Processing of payments Based on request for transaction fee in accordance periodic billing based on actual disbursements and other financial payment with the country office pricelist number of transactions transactions Based on request and Procurement of goods and transaction fee in accordance periodic billing based on actual project annual work services with the country office pricelist number of transactions plan

Project personnel and Based on request transaction fee in accordance periodic billing based on actual consultants selection and and project annual with the country office pricelist number of transactions recruitment process work plan Based on request transaction fee in accordance periodic billing based on actual Travel arrangements and project annual with the country office pricelist number of transactions work plan

109 Belarus Refrigerant Management Plan

General administration (pouch Based on request transaction fee in accordance periodic billing based on actual service, visa support, customs and project annual with the country office pricelist number of transactions clearance, etc) work plan Based on request and transaction fee in accordance periodic billing based on actual IT services project annual work with the country office pricelist number of transactions plan Based on UNDP 1% of the UNDP resources Communications service country office Billing once a year contributed to a project communication plan

If the requirements for support services by the country office change during the life of a project, the annex may be revised with the mutual agreement of the UNDP Resident Representative and the Ministry of Natural Resources and Environmental Protection of Belarus.

International Public Sector Accounting Standards are financial reporting standards used in UNDP. The UNDP country office may provide support in execution of the project activities:

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