The Montreal Protocol (MP) was agreed in 1987 after scientists showed that certain man-made substances were contributing to the depletion of the Earth's ozone layer. The Multilateral Fund (MLF) for the Implementation of the MP was established by the London Amendment to the Protocol in 1990. It was the first financial mechanism to be borne from an international treaty.
The MLF provides funds to help developing countries comply with their obligations under the Protocol to phase out the use of ozone-depleting substances (ODS) at an agreed schedule. Since the adoption of the Kigali Amendment in October 2016 (Decision XXVIII/2) the MP also covers powerful climate-warming pollutants called hydrofluorocarbons (HFCs). Parties agreed to phase down HFC emissions over the next three decades, thereby building a fundamental pillar to achieving the ultimate climate goal set out in the Paris Agreement. The use of HFCs and their resulting emissions are reported to the UNFCCC as substances to be limited or reduced. An early phase-down of HFCs under the MP is one of the most cost-effective GHG mitigation options available today.
Fast start financing will be available from 2017 onwards. For this, some donors have pledged to provide an additional voluntary USD 27 million. According to the Kigali Amendment, the following activities would be eligible for funding to facilitate early ratification and rapid phase-down of HFCs: implementing HFC phase down strategies and public awareness; data reporting (HFC Inventories); enforcement and customs training; service sector training and capacity building as well as measures for safe introduction of hazardous alternatives.
The date from which developing countries (Article 5 of the MP) will be able to access regular MLF finance for activities to reach their first legally binding HFC reduction targets will be decided in 2017/18. The eligible funding will be provided on the basis of the country’s total HFC baseline consumption and in view of subsector specific cost guidelines. MLF funding guidelines will be developed within the next two years and submitted to the parties of the MP for their approval. Activities that will be funded under the MP comprise: technological transfer including industrial conversion; technical assistance; information dissemination as well as training and capacity building aimed at phasing out HFCs used in a broad range of sectors. During the phase down of HFCs, Article 5 parties will have the flexibility to individually select HFC sectors and replacement technologies, and adapt their strategies to their needs and national circumstances.
A5 countries, submitting project proposals via bilateral or multilateral implementing agencies, can request MLF resources to implement early actions on HFCs from 2017 onwards. In 2017/18 members of the ExCom will decide on the date at which developing countries will be able to access regular MLF funding for their HFC phase down plans. Refer to this resource sheet for more information.
Funding size varies according to replenishment term. The MLF is replenished on a three-year basis by the donor countries. Contributions from developed countries (non-Article 5 countries) are assessed according to the UN scale of assessment. As of December 2016 the total contributions accrued to over USD 3.6 billion. In the context of the Kigali amendment USD 27 million have been pledged by a group of donor countries to enable early action on HFCs. Hence, these additional voluntary funds are likely to be approved in 2017 for funding early action on HFCs between 2018 and 2020.