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Demand is hot for cool air. In certain urban areas of China, where air conditioners were practically unknown 20 years ago, almost every household now has one. Sales in countries like India are growing at over 10 percent a year. Altogether,

All this cooling has health and development benefits – preserving food, increasing productivity, and improving the quality of life for hundreds of millions of people.  

But it also comes at a steep cost to the climate. Air conditioning increases electricity use, especially at peak times, and cooling will soon outstrip heating as the primary driver of consumer power demand. Cooling technology also depends on hydrofluorocarbons (HFCs) - potent greenhouse gases that can have several thousand times the warming effect of CO₂.  

Until now.

On October 15, at a meeting in Kigali, Rwanda, the 197 parties to the  agreed to an amendment that would phase down the use of HFCs around the world. This single decision could reduce the rise in the global mean temperature by 0.5 degrees Celsius by the end of the century – one of the most significant steps in the fight against climate change, and a major contribution to the goals of the Paris Agreement, which will go into force on November 4.

As an implementing agency of the Montreal Protocol since 1991, the World Bank Group has channeled more than $1 billion in grants so far to phase out the consumption and production of ozone-depleting substances. And as President Jim Yong Kim made clear at this year’s Annual Meetings, the Bank Group plans to continue this work – supporting countries as they phase down HFCs and improve energy efficiency.

“We have developed a support plan that includes ramping up our lending for energy efficiency to accompany the HFC phase-down,” said Anna Bjerde, Acting Senior Director of Energy at the World Bank. “As part of our Climate Change Action Plan, we expect to do $1 billion in lending by 2020 for energy efficiency in urban areas. This could help support the development of high-efficiency cooling technologies that also use climate-friendly refrigerants.”

This work is already underway. In Thailand, for example, the World Bank has helped a local manufacturer launch a new line of air conditioners that uses a refrigerant that does not deplete the ozone layer and reduces greenhouse gas emissions by a third. 

Efforts to phase down HFCs will build on the Bank Group’s successful engagements with countries to end consumption and production of ozone-depleting substances under the Montreal Protocol.

In April 2013, the Government of China and the Bank Group started working with Chinese enterprises to phase out the production of ozone-destroying hydrochlorofluorocarbons (HCFCs). Five production facilities have been closed down so far – accounting for 16 percent of the country’s total HCFC production.  As part of this effort, China has also put in place incentives to destroy HFC-23, a greenhouse gas more than 10,000 times more potent than CO₂, with a goal of total phase-out by 2020.

“Going forward, we will target opportunities that deliver a triple win: projects that increase the efficiency of cooling technology, decrease energy consumption, and do away with chemicals that are dangerous to the climate,” said John Roome, Senior Director for Climate Change at the World Bank. “And we will increase our financing and technical assistance for this work.”

Beyond committing its own financing, the Bank Group will take four other steps to expand its work in this area:

• Undertake studies to identify where impacts could be the greatest.  (For example, one study in Pakistan estimated that a transition to new refrigerants could cut power consumption from air conditioning by 40 percent and reduce greenhouse gas emissions by 8 million tons).
• Integrate technical assistance and policy work with concessional financing
• Deploy new Montreal Protocol financing to help countries
• Share knowledge and practices across countries to accelerate action

Reaching the Kigali agreement took over half a decade of work, focusing on issues like technology safety and availability, intellectual property rights, and additional financial support. Throughout this process the World Bank worked with both developed and developing countries on key issues, including work to clarify patent expiry dates.

Since 1991, the Bank Group has supported more than 700 projects under the Montreal Protocol to phase out ozone-depleting substances in refrigeration, air-conditioning and the manufacture of foam products. These projects have phased out more than 300,000 tons of ozone depleting substances, the equivalent of avoiding more than 1.2 billion tons in CO₂ emissions.