Common use of Problem Statement Clause in Contracts

Problem Statement. As ▇▇▇▇▇ has pointed out in its project proposal, the worldwide bank of blowing agents contained in foams was estimated to exceed 11 billion tons CO2-eq in 2002 and is likely to remain above 9 billion tons CO2-eq in 2015 under most business-as-usual scenarios. However, following the phase-out of the more emissive foam applications that were still using CFCs in the late 1990s, the emissions from foam banks are expected to settle in the range of 180 million tons CO2-eq annually over the next few decades – i.e., 2% of banked quantities per year. This means that losses from foams could continue well into the future – perhaps for in excess of 100 years – particularly if some of those foams are land-filled. However, because the annual baseline loss rate is relatively low, attention typically switches to preventing emissions from more emissive banks – e.g., refrigerants, where loss rates are often well in excess of 20% of banked quantities annually. This trend persists despite the fact that the foam banks are larger overall. It reflects the fact that measures can be more cost-effective and easier to introduce when preventing refrigerant emissions. Nevertheless, the opportunity for the mitigation of emissions from foams remains highly significant, particularly at end-of-life. Based on the US EPA model data, a 5 billion metric ton CO2-eq bank from ODS/HFC foam sources could be estimated for the USA in 2005, with annual emissions in the 1 The U.S. EPA’s Vintaging Model was developed as a tool for estimating the annual chemical emissions from industrial sectors that have historically used ODSs such as CFCs, HCFCs, and halons in their products. The Vintaging Model also estimates emissions from ODS substitutes such as HFCs. The model name refers to the fact that it tracks the use and emissions of annual “vintages” of equipment that enter service or are disposed in each of several end- uses that make up an industrial sector (▇▇▇▇▇▇, 2003). region of 92 million metric tons CO2-eq. By applying a population factor of 12.8% for California, based on the US census, the California ODS/HFC banks could be estimated at 640 million tons CO2-eq with 12 million tons CO2-eq being emitted per annum from ODS and HFC foam sources (US EPA, 2005). Original Air Resources Board estimates in 2007 noted that approximately 60% of the total bank of high-global warming potential greenhouse gases is from foam sources, with most of the remaining banks from refrigerants. CARB estimated that the foam banks account for some 385 million tons CO2-eq and generate an annual emission of approximately 9 million tons CO2-eq. (CARB, 2007a).

Problem Statement. As ▇▇▇▇▇ has pointed out in its project proposal, the worldwide bank of blowing agents contained in foams was estimated to exceed 11 billion tons CO2-eq in 2002 and is likely to remain above 9 billion tons CO2-eq in 2015 under most business-as-usual scenarios. However, following the phase-out of the more emissive foam applications that were still using CFCs in the late 1990s, the emissions from foam banks are expected to settle in the range of 180 million tons CO2-eq annually over the next few decades – i.e., i.e. 2% of banked quantities per year. This means that losses from foams could continue well into the future – perhaps for in excess of 100 years – particularly if some of those foams are land-filled. However, because the annual baseline loss rate is relatively low, attention typically switches to preventing emissions from more emissive banks – e.g., e.g. refrigerants, where loss rates are often well in excess of 20% of banked quantities annually. This trend persists despite the fact that the foam banks are larger overall. It reflects the fact that measures can be more cost-effective and easier to introduce when preventing refrigerant emissions. Nevertheless, the opportunity for the mitigation of emissions from foams remains highly significant, particularly at end-of-life. Based on the US EPA model data, a 5 billion metric ton CO2-eq bank from ODS/HFC foam sources could be estimated for the USA in 2005, with annual emissions in the 1 The U.S. EPA’s Vintaging Model was developed as a tool for estimating the annual chemical emissions from industrial sectors that have historically used ODSs such as CFCs, HCFCs, and halons in their products. The Vintaging Model also estimates emissions from ODS substitutes such as HFCs. The model name refers to the fact that it tracks the use and emissions of annual “vintages” of equipment that enter service or are disposed in each of several end- uses that make up an industrial sector (▇▇▇▇▇▇, 2003). region of 92 million metric tons CO2-eq. By applying a population factor of 12.8% for California, based on the US census, the California ODS/HFC banks could be estimated at 640 million tons CO2-eq with 12 million tons CO2-eq being emitted per annum from ODS and & HFC foam sources (US EPA, 2005)sources. Original Air Resources Board estimates in 2007 noted that approximately Approximately 60% of the total bank of high-global warming potential greenhouse gases is from foam sources, with most of the remaining banks from refrigerants. CARB estimated that the foam banks account accounting for some 385 million tons CO2-eq and generate an generating annual emission emissions of approximately 9 million tons CO2-eq. (CARB, 2007a).eq.1