EC Control of Ozone Depleting Substances Update on the Draft EC Regulation Presented by Pacific Scientific at the International Halon Replacement Working Group Meeting Bremen - May 2000

EC Control of Ozone Depleting Substances May 2000Pacific Scientific Maidenhead UK2 Update on the Draft Regulation Background and Status Halon –Controls –Critical Use –Import / Export Impact for Aerospace Airline Strategy

EC Control of Ozone Depleting Substances May 2000Pacific Scientific Maidenhead UK3 Background New Regulation first seen in draft form in Aug Proposes controls on the production, use, sale, import, export and recovery of ODS’s, including Halon. Includes Halons, CFCs HCFCs etc. Will replace regulation 3093/94, which prohibited production of Halon and other ODS’s.

EC Control of Ozone Depleting Substances May 2000Pacific Scientific Maidenhead UK4 Current Status 2nd reading of the EU Parliament Dec 99 Some outstanding issues on HCFCs Halon aspects are agreed. Could be adopted June 2000.

EC Control of Ozone Depleting Substances May 2000Pacific Scientific Maidenhead UK5 Current Status - Entry into Force Probable date is 1st October UK and others suggested 1st Jan 2001 to allow time for national ratification. Will supersede current national legislation in those countries which already have local controls (e.g. Germany)

EC Control of Ozone Depleting Substances May 2000Pacific Scientific Maidenhead UK6 Halon Controls (Article 4) Prohibits sale or use of Halons after entry into force, except as allowed below: –Use and sale of recovered/reclaimed Halons in existing systems until 31 Dec 2002 –All systems and extinguishers must be de- commissioned by 31 Dec Exceptions for critical uses which are listed in Annex VII of the regulation.

EC Control of Ozone Depleting Substances May 2000Pacific Scientific Maidenhead UK7 Critical Uses of Halons (Aircraft) Halon 1301 –“In Aircraft for the protection of crew compartments, engine nacelles,cargo bays and dry bays.” Halon 1211 –“In hand-held fire extinguishers and fixed extinguisher equipment for engines for use on board aircraft” –“In Aircraft for the protection of crew compartments, engine nacelles, cargo bays and dry bays”

EC Control of Ozone Depleting Substances May 2000Pacific Scientific Maidenhead UK8 Import Controls (Articles 6 & 7) Import Licensing –The restrictions are similar to those in 3093/94. –An Import Licence issued by the Commission is required for bulk imports. There will be quantitative limits. –Affects both Free Circulation and IPR imports. –Free Circulation import only permitted for essential or critical use or destruction. –In the event of a Halon shortage, obtaining an import Quota/Licence is likely to be a protracted process. –No restrictions on products for critical uses.

EC Control of Ozone Depleting Substances May 2000Pacific Scientific Maidenhead UK9 Export Controls (Articles 11 & 12) Export of products and equipment containing Halon will be permitted for Critical Uses It is understood that bulk export of Halon will not be permitted, even for Critical Uses Applies from Entry into Force date. Export Licences issued annually with quantity limits and stated destinations. Applications will need the support of the national enforcement agency.

EC Control of Ozone Depleting Substances May 2000Pacific Scientific Maidenhead UK10 Impact for Aviation Users need to secure supplies before phase-out date. Affects non-EC users that are dependant on EC Service Providers. Airline is the Critical User, not Service Provider. Service Providers are unlikely to accept the full risk of Investment / Destruction Costs. US shortage of Halon could affect new aircraft deliveries ? Waste Bin Extinguisher not a Critical Use?

EC Control of Ozone Depleting Substances May 2000Pacific Scientific Maidenhead UK11 Factors Affecting Future Needs Unknown existing stocks (Banked or Installed) Unknown end dates for each application. Fleet growth New regulation (D to C, etc.) Consumption ( Fires, False Warnings, Hydrostatic Testing) Economics, Feasibility and Timescale for a changeout on existing aircraft. Emergence of new technologies.

EC Control of Ozone Depleting Substances May 2000Pacific Scientific Maidenhead UK12 Airline / Airframe Mfr Strategy Forecast of Future Needs is a priority. Strategy for continued availability. –Airline Halon Bank –Contracted Halon Bank or Contracted Supplies. Plan should consider the risk of a US Shortage –Possible need to source the Halon needed for new aircraft. Regular purchases during Phase-out –Minimise Financial Impact/Availability risks.

EC Control of Ozone Depleting Substances May 2000Pacific Scientific Maidenhead UK13 Support from Service Providers Provider/Repair Station probably can: –Assist with the Airlines requirements forecast. –Assist with the sourcing of Halon before Phase-out. –Provide recovery and banking facilities. –Provide ongoing Overhaul and Recharging facilities. Provider/Repair Station probably won’t/can’t : –Provide or guarantee the needs of the industry from their own resources. –Take the risk of subsequent destruction costs unaided. –Stabilise Halon prices - now a commodity.

EC Control of Ozone Depleting Substances May 2000Pacific Scientific Maidenhead UK14 Conclusion Airlines and Manufacturers need: –A forecast of future Halon requirements, which includes a “What if” analysis. –A plan on how this will be provided. –The plan should be reviewed regularly to take account of changing availability and alternatives progress. –Active management of their Halon source, either through an Airline Bank, a Contracted Bank or a Supply agreement. – Waste Bin Extinguisher replacement ?

EC Control of Ozone Depleting Substances May 2000Pacific Scientific Maidenhead UK15 Finally If an Airline is going to rely on a Supplier agreement alone: –They need to be pretty confident the supplier will still be in business and able to supply when Halon is needed. –They are gambling on the Airline’s future, because the Halon price could be nothing, or a fortune.