Tectonic Shifts in Refrigeration; What Happens to Energy Use with the Great Shake to Natural Refrigerants?

In California, we’re used to the earth shaking from time to time and now the refrigerant world is also shifting seismically. The impacts of this shift on businesses and energy use in the state could be just as scary and pronounced unless we prepare.

The coming shift is another phase-out of refrigerants, but this time it’s actually a bigger deal than the previous shake ups. We’re on a track to phase out hydrofluorocarbons (HFCs) – refrigerants we “phased into” 25 years ago – and it’s going to produce a huge shift in how we keep our buildings comfortable and our food cold.

The good news is that, in some ways we’ve been here before. This time there could be a lot of opportunities created from these policy shifts, if we’re prepared and manage the changes well.

What changes? We already phased out “bad” refrigerants.

The phasing out of HFC refrigerants is seismically huge. HFCs are the biggest class of refrigerants still used in new equipment. They have been the go-to solution for many years in air conditioning, heat pumps and commercial refrigeration.

The first wave of refrigerant phase outs came in the 1990’s (more on that later) and since then, HFCs have taken over the market. Even though HFCs have zero ozone depleting potential (ODP), many are still strong greenhouse gases. Now the policy scales have tilted further and they’re on the way out.

The big policy drivers are coming, nearly simultaneously from 1) the rest of the world (i.e., outside the U.S.) and 2) California’s Air Resources Board (CARB). We’ll look briefly at each but first, let’s indulge in a feel-good environmental story…

The most successful environmental regulation you’ve never heard of, the Montreal Protocol.

So maybe you knew about it, but my guess if you’re here, you’re an energy geek. Most people don’t know about the Montreal Protocol because it was incredibly successful.

Scientists in the 1970s began sounding the alarm that substances with high ODP had the potential for destroying the earth’s protective ozone layer. Without the ozone layer, we would be exposed to drastically higher levels of ultraviolet radiation, with associated increases in sunburn, skin cancers, cataracts, etc. In short, it could have been very bad indeed.

In response, as scientific consensus arose (back in the days when scientists were respected for their work on behalf of society, rather than ridiculed for it), world leaders in policy and science met to propose a response to the issue. In 1987, a series of meetings culminated in Montreal and an accord was signed which went into effect January 1, 1989.

What did the protocol say?

Under the Montreal Protocol, the nations of the world would manage a global change to eliminate the use of substances that were highly damaging to the ozone later called ozone-depleting chemicals (ODCs). It was designed and initially amended to:

  • First, reduce the production and consumption of two types of ODCs to 80 percent of 1986 levels by 1994 and 50 percent of 1986 levels by 1999. These ODCs were chlorofluorocarbon (CFCs) and halons (carbon compounds with bromine and fluorine).
  • Then, further reduce and completely phase out CFCs and halons, as well as the manufacture and use of many other ODCs.

The signing countries then banded together to track progress towards this goal and authorize new changes to the process of phasing out ODCs.

Now I’ve painted a pretty picture here and, in retrospect, it all sounds like a lovely story. But at the time, there was a ton of resistance from, let’s call them, the usual suspects, who claimed:

  • The science isn’t complete.
    “Chairman Scorer of DuPont commented that the ozone depletion theory was “a science fiction tale…a load of rubbish…utter nonsense.”
  • Our studies show otherwise.
    “numerous critics of the ozone hole discovery claimed that Professor G.M.B. Dobson had measured an ozone hole in 1956 in the Antarctic, and thus an Antarctic ozone hole was a normal natural occurrence.”
  • The alternatives are too expensive.
  • It’ll ruin the economy.
  • But wait there’s more.
    You can find a great summary of ozone skepticism on wunderground here.

Though the original claims against the science of ozone depletion are decades old, they sound familiar, don’t they?

There’s lots we can learn from here. The good news is that, in spite of the usual suspects, world leaders came to a reasonable agreement, charted a course of action, followed it, and basically, succeeded. Which is why we now see, in the last few years, significant evidence of a “healing” ozone layer. But then that’s just according to a bunch of quacky rocket-scientists at NASA. They’re all just in it for the money and the groupies.

Which brings us…

Back to Kigali

Technically the new policies agreed upon at Kigali last year are an amendment to the Montreal Protocol. Essentially, the amendment shifts the mission from one of ozone depletion, to global warming mitigation. To do that, we need to get rid of HFCs, another type of ODCs.

Does the Kigali Amendment Matter? The US didn’t sign on.

YES! It absolutely matters.

The folks who put together the amendment didn’t just “fall off the turnip truck”. Knowing that the US, and its current political climate, might be a reluctant co-signer of the amendment, they chose a smart path.

The amendment required that the signers of the treaty agree that they would not trade in refrigerants with countries that did not ratify the amendment. “Article 4 of the Montreal Protocol restricts Parties from trading controlled substances with states not party to the Protocol”. While the US was not one of the original 21 countries that ratified the amendment, or the 35 that have signed it to date, if we want to sell refrigerants to those countries, we need to sign on too.

According to refrigerant experts like Keilly Witman, with the huge market for US refrigerants in most of Europe, there will be plenty of pressure on congress for us to ratify. So in this case, we might have Scott Pruitt’s job usurped by legislation backed by Dupont (“better living through chemistry!”).

Do CARB regulations matter? I don’t live in California.


Here in California, local regulators are also acting to hasten HFC phase out. Due to a lawsuit that overturned the EPA’s intention to phase out HFCs, California has stepped in to do the same, based on its own legislative commitment to mitigate global warming. This policy approach is common these days as the state has stepped in where federal leadership has evaporated.

Because California has an economy larger than most countries in the world, manufacturers consider those regulations carefully when designing new products. When California adopts regulations that limit the sales of air conditioners, or commercial refrigeration systems, the market takes notice and often shifts to serve the new need.

Those who don’t change fall behind, lose market share foothold, or run the risk of obsolescence. So even if you’re not one of us latte-sipping, tree-hugging, electric-scooter-riding neuvo California hippies, the market is going to change anyway.

Enter the naturals.

Big refrigerant users have been working on options for years. Through the GreenChill program, 238 stores in the US, 69 of which are in California, have committed to low- GWP approaches in their stores. Through those stores, many of the big grocery chains have piloted low- or no-GWP refrigeration designs.

As we consider options for natural refrigerants, it makes you appreciate why we picked CFCs in the first place. If you’re blind to ODP and GWP, the CFCs were great – odorless, non-flammable, non-toxic, non-reactive and inherently pretty efficient. Most of the substances we need to shift to, compromise on one or more of those criteria.

This leads me (and many others) to a couple of brief conclusions of what to expect in the market as we transition to low or no-GWP refrigerants:

  1. HFCs, hydrochlorofluorocarbons (HCFCs), CFCs and the like will all go the way of the dinosaur, and Kigali says that by 2030 the last of them will be reduced by at least 80%.
  2. The field of remaining “natural” refrigerants is not huge. Most new store designs rely on:
    1. CO2
    2. Ammonia
    3. Hydrocarbons (Isobutane and Propane, self-contained)
    4. Hydrofluoro-olefins (technically not really “naturals” but very low GWP)
  3. Experience with these options is growing fast, but isn’t yet vast in the US.
    Lots of workforce training will be needed to update the labor market used to design, install, and maintain these systems.
  4. Compromises will be made; and energy consumption may be a big one.

The potential impact of natural refrigerants on energy efficiency.

The realities of the vapor compression cycle, key to mechanical refrigeration, holds generally bad news for energy consumption. Most of the low-GWP or natural options come with an energy-use penalty that is sometimes very significant – as high as a 20% energy consumption penalty. With about 40,000 grocery stores in the US, that could be a very big deal.

The good news is that with change comes opportunity. I’m old enough to have been working in energy efficiency during the post-Montreal years. I have seen the energy saving opportunities created by refrigerant phase-outs due to necessary equipment turnover.

When you have to replace your compressors, and maybe your refrigerated cases, you’re already “in it up to your elbows.” It’s prudent to seize the opportunity to also update controls, upgrade to the best cases (low-E doors, no-heat doors, efficient case fan motors, doors on beverage cases, etc.). “Market Churn” provides opportunities, if we’re prepared to act.

So are you ready for the tectonic shift in refrigeration? Do you feel prepared for the next 10 years of shakes, bumps, and changes as things settle? What will big changes in refrigeration and air conditioning mean to your business plan? Your outreach plan? Your program design? I’m dying to know. Comment below or shoot me a message on LI.

I’ll be digging into these changes in much greater detail in the coming months. More soon.

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