It’s the worst United Nations treaty that you’ve never heard of, and the Senate is on the verge of ratifying it. The Kigali Amendment is bad for consumers and bad for American competitiveness, yet it may soon be the law of the land.
The Kigali Amendment restricts production of hydrofluorocarbons (HFCs) based on concerns that they contribute to (what else?) climate change. (RELATED: KHOSHBIN: Here’s How Nuclear Energy Can Save Coal Communities)
The problem is that HFCs are the refrigerants needed to run most home air conditioners, vehicle air conditioners and many millions of refrigeration systems used by businesses like restaurants and supermarkets. Replenishing HFCs lost from a leak will get costlier as supplies dwindle and prices rise.
In fact, it is already happening. Thanks to domestic HFCs limits imposed by the Environmental Protection Agency that took effect this year, the price of the refrigerant used in home air conditioners shot up 4-fold, and as a result certain repairs now cost hundreds more. Repair bills will likely rise in future summers as the HFC quotas get more stringent.
The Kigali Amendment would tighten the screws even further. Worst of all, unlike domestic legislation which can be amended or repealed, treaties are very hard to reverse. Thus, ratification of Kigali would very likely mean no Congressional recourse even if consumer costs skyrocket in the years ahead. In effect, the treaty would cede control of the issue to the UN.
HFCs also have uses in a number of industrial processes, and Kigali puts American manufacturers at a competitive disadvantage. Shockingly, the UN classifies China as one of the 150 developing nations under the Kigali Amendment, and extends far more lenient treatment to it.
This includes an HFC phasedown schedule that gives these countries an extra ten years. Thus, factories located in China will have access to cheap and plentiful HFCs long after supplies get tight for facilities located here. To make matters even worse, the U.S. is the single largest contributor to a UN fund that will assist China and other developing nations with compliance. So, we will be giving China an unfair advantage and sending them tax dollars as well.
The only beneficiaries of the Kigali Amendment are those in the air conditioning and refrigeration sector. For them, Kigali skews the market toward more expensive products.
These companies have engaged in an extensive lobbying effort, led by several chemical companies that have patented a suite of costly replacements for HFCs. But their gains come at the expense of the rest of us — both consumers and business that rely on air conditioning and refrigeration and will be paying more for it.
The Constitution requires that the Senate ratify treaties by a two-thirds margin — in other words 67 senators. All 50 Senate Democrats support the Kigali Amendment, and it may have the votes of 17 or more Senate Republicans as well.
One might think that a UN environmental treaty that constrains market competition, raises prices and has a separate set of rules for China would be a hard sell among Republicans, but several have expressed strong support. The vote is imminent, but no specific day has yet been scheduled.
Right now, the Kigali Amendment and its potential impacts are virtually unknown. But if it is ratified, millions of consumers and businesses will find out the hard way.
Ben Lieberman is a Senior Fellow with the Competitive Enterprise Institute, in Washington, D.C.
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