An Inadequate Reaction

“It’s still mainly business as usual,” says Daniel de Graaf, Scientific Assistant at the German Environment Agency, who believes that the air conditioning and refrigeration sector’s adoption of low-GWP refrigerants in the country remains inadequate. This, he says, is the case despite stakeholders encountering problems with procuring refrigerants owing to the European F-Gas Regulation (Regulation (EU) No 517/2014), citing recent reports of refrigerant theft to highlight the sense of desperation in the market. “We had a wake-up call, last year, when refrigerant prices went through the ceiling,” he says. “In January 2017, in Germany, you paid EUR 100 for 12.6 kg cylinder of R 134a. Now it’s EUR 600 or even more.” Regarding R-404A, which is the standard refrigerant for commercial uses, such as supermarket refrigeration, de Graaf says, the price hike was even more dramatic at approximately 1,000% in one year and a half.

De Graaf says that due to the CO2 equivalent based HFC phase down approach of the F-Gas Regulation, there is lack of clarity about the question, ‘Which refrigerant is future-proof for the European market and which is not?’ This becomes more obvious with prohibitions, which have been put down for some applications in Annex III of the F-gas Regulation, for example, for household or air conditioning appliances. “With portable air conditioners,” he explains, “you’re only allowed to sell appliances that use refrigerants with a GWP of 150 or less, from 2020 on. In this segment, you have a complete halt for HFCs, with prohibition of mini-splits containing refrigerants with a GWP of more than 750 from 2025.” But even more important, de Graaf stresses, is the prohibition to the placing on the market of stationary refrigeration plants using refrigerants with a GWP of more than 2,500, such as R-404A, starting from 2020.

While the F-Gas Regulation provides a framework to restrict the amount of HFC, de Graaf says it is up to the market to find the most economical solution. “The problem is people do not want to adopt accordingly, because sometimes it just blows away their business case,” he says. “If you sell chillers with HFCs and made a lot of money and you are told you have to use something else — propane or ammonia, for instance — that’s not what you had as a business case. This is especially true if you don’t only sell the chillers but also the HFC refrigerant for the chillers. Natural refrigerants are definitely no business case for HFC or HFO manufacturers.” Rolf Werner, Director, Application Engineering, Wieland, adds that for manufacturers, there is a lack of clarity on the type of refrigerant that will take the lead in the market. “We can see CO2 applications on the rise for supermarkets and buildings,” he says. “That’s clear, but for all of the other refrigerants, it’s quite unclear and uncertain.” Maciej Danielak, Export Sales Director, Kampann, weighs in, saying that the increasing prices of refrigerant have paved the way for water-based systems, which has seen an uptake, adding that the companies dealing with refrigerants are looking to complement and expand their portfolio.

Dr. Karin Jahn, Technical Manager, Sector department, Refrigeration and Heat Pump Technology, VDMA, believes that the current environmental policy framework in Germany is boosting the demand for climate-friendly solutions in the refrigeration sector, stressing that the European F-Gases Regulation and the Kigali Amendment to the Montreal Protocol have triggered a lively discussion in the market about the use of various refrigerants, with renewed interest in natural alternatives.

De Graaf stresses that that there is further scope for natural refrigerants to be used, saying that manufacturers and end-users are settling for interim solutions that are unable to cope with looming targets. “R-32 is becoming more and more prominent in the market, when it comes to room air conditioners,” he says, “but R-32 still has a high GWP of 675. We need to get down to an average GWP of roughly 400 by 2030 — that’s still quite a gap to close. R-32 is not a final solution, but it’s what is marketed a lot right now in Germany and throughout Europe.”

Bottlenecks in the adoption of natural refrigerants, de Graaf says, can also be partially attributed to lack of training. Dr Jahn adds that many installers and workers are interested in converting existing refrigeration systems and ensuring the viability of future systems to be installed; however, the planning, installation and operation of systems with flammable refrigerants demands special legal expertise and safety-engineering know-how.

De Graaf believes craftsmen and technicians are the stakeholders that should be addressed, as they are the ones reluctant to move away from standard HVAC refrigerants and deal with flammable or toxic alternatives, with many apprehensive towards even R-32 appliances.

Dr Jahn remains optimistic, however, saying that the fundamentally high standard of training systems in Germany puts the industry in a very good position. “In principle, the training programmes in Germany are so broad that the graduates are familiar with all established refrigerant alternatives,” she says, “whether natural refrigerants, synthetic refrigerants or blends, and are able to pursue respective developments in refrigeration and air-conditioning companies.” Even so, Dr Jahn says that there remains a high demand for special seminars and courses to keep them up to date with the latest legislation and engineering developments.

De Graaf adds that, of late, there are a number of incentives, namely support programmes where end users can get money from the German government when opting for equipment with natural refrigerants. He also believes that investment into the development of new solutions with natural refrigerants makes economic sense for manufacturers, since they are F-Gas Regulation-proof also in the long run and outperform HFC as well as HFO equipment energetically. The latter is also important for end users, who accept higher initial investment costs when, due to lower energy costs, life cycle costs are equal or lower compared to HFC equipment.

Even with existing innovations, however, de Graaf expresses his concern at manufacturers’ reluctance towards introducing products to the market, citing instances wherein a manufacturer that received the German Blue Angel ecolabel certification for his product in March 2018, still refrained from introducing it to the market. “There are some other manufacturers, as well, for single split appliances with R-290 that still refrain from bringing them to the market because of the safety issue,” he says, “but they may be a little bit too cautious in this respect. In India, one such manufacturer sold 600,000 units, which are installed with no incident because technicians had proper training.” As such, de Graaf issues a plea to manufacturers that have solutions in their portfolio, “Please be a little braver in bringing your energy-efficient and climate- friendly solutions to the German and European market.”

An uncompromising stance

Italy’s relentless compliance with the European Union’s broader environmental targets is in the process of reshaping the HVACR sector in the country, with Andrea Guderzo, General Manager, Clivet Mideast FZCO, emphasising that the decarbonisation of the EU has created a new set of challenges and opportunities for the market in the country, as well as in the rest of Europe.

In agreement was Salah Eldeeb, AREA Export and Sales Manager, Castel, who says that there has been increasing demand for products that can accommodate new refrigerants with lower GWP in view of the F-Gas Regulation. “Everybody is focusing on these new regulations,” he says. “Within 2020, all HCFCs will be abandoned completely, so new projects and productions are going in with the new refrigerants.” Guderzo adds that the regulation has also led to a significant increase in the price of refrigerants and that those containing CFCs have already been withdrawn from circulation. “Today’s refrigerants may no longer be comparable with these, but their potential for harm cannot be ignored,” he says, emphasising that it is necessary to undertake step-by-step phase-down in refrigerants with a high-GWP.

Francesco Mastrapasqua, Marketing Manager, Refrigeration Systems, Epta, adds that the huge increase in price and the dramatic cut in the availability in the market, owing to F-Gas Regulation, has made every stakeholder consider very carefully the refrigerant for future applications. The market conditions created by these regulations, Guderzo says, has been driving innovation among HVACR manufacturers in Italy. As a temporary solution, he says, a number of producers are delivering units addressed to non-EU countries without refrigerants to cut down costs, which, he says, merely postpones the problem. However, Guderzo stresses that most producers are taking a more long-term approach by investing significantly in R&D to adopt new refrigerants, especially R-32, for small capacity units, which, he says is the same direction Clivet is taking. “Our company is facing the refrigerant challenge with great research and development work,” Guderzo says. “The first step is to adopt R32 refrigerant for units with inverter and scroll compressor for the medium- and low-capacity units. In the meantime, a joint task force involving the R&D units of Clivet and Midea, is developing new solutions using R1234ze refrigerant for high-capacity chillers. We are also studying to decrease overall the maximum quantity of refrigerant and the use of other low-GWP gases, especially for the medium-capacity chillers.”

The paradigm shift is especially palpable in the refrigeration sector, where Mastrapasqua says, natural refrigerants are being viewed as key to futureproofing equipment. “The refrigeration market in Italy is placing maximum importance on natural refrigeration solutions,” he says, adding that the company has, thus, ensured its scope of products offers a large variety of natural solutions. “The main technological trend and development have been for small-capacity systems; self-contained product adoption based on hydrocarbons, namely propane; and larger systems, which tend to be based on C02 for direct expansion market in Italy.” There has been strong determination in the market to adopt to this trend, he adds, as they are in accordance with F-Gas Regulation and Eco-Design Regulation. Mirko Travaglin, Marketing Manager Refrigeration – EMEA Region, Carel, seconds this, saying that in Europe, the use of natural refrigerants has mainly been implemented with trans-critical CO2 systems, which has, today, become a standard solution.

Bottlenecks in adoption: training

While the adoption of manufacturers is undeniable, Mastrapasqua says the main bottleneck for more widespread adoption is related to availability of skilled personnel that can ensure the performance and facilitate in the installation, commissioning and overall service of products with natural refrigerants. “There is still a need for training,” he says. “Despite all activities in place, the industry is still not coping with the demand. Still, competence and specific training is somehow a barrier in the adoption.”

Mastrapasqua says the industry, as a whole, has to work together to remedy this, in two aspects. “Aftersales service is one side,” he said. “On the other side is the need to provide simplified technology in our systems to fight against the very complexity of natural systems and provide the market with a product that eliminates all concerns.” Secondly, Mastrapasqua says the industry must take a more proactive stance towards training. Epta has made a move in this regard, with the recent inauguration of the Training Center for Refrigeration Experts, in Italy, which, the company says, is the only professional school in Italy to train future refrigeration technicians according to UNI EN 13313 and the first school in Europe, where a small store has been set up with trans-critical CO2 technology, made available by Epta. Costing over EUR 500,000 of investments and donations, the Training Center, the company says, was set up by the professional institute, ASLAM, together with the Assocold and Assofrigoristi associations, to address growing need for skilled expert to manage new natural refrigerants, which are the solutions of the future.

On the inauguration, Marco Nocivelli, Chairman and CEO of Epta and Chairman of Assocold, says: “Italy boasts a wealth of technical expertise in refrigeration and climate control. Passing that expertise on to young people will make a positive contribution towards increasing the success of the national system as a whole. The creation of the Institute bears tangible witness to our social commitment and our faith in the younger generations. It will allow them to achieve preparation of a high standard for a profession, which is increasingly in demand. The training is geared towards the future and will allow young people to become successful expert technicians that can provide effective responses to the challenges posed by constant technological progress, and by European and international regulations.”

Eldeep echoes the importance of proper training, saying that Castel, as an OEM provider, with 75% of its products compatible for refrigeration and only 25% going to air conditioning segment, is taking on a consultancy role to companies and providing assistance to develop products according to regulations. “We conduct a lot of seminars because of this, not only with the manufacturers but also with installers and maintenance,” he says. This, he says, has been especially vital, owing to the number of retrofits related to refrigerants. “In Italy,” he says, “new products and machines are going towards new refrigerants, but people have to know how they work. That is our role. We have to help them understand how it works and the difference between all the refrigerants for new technology and old technology.”

The need for skilled workforce, Matrapasqua says, is thoroughly recognised by the government, which has implemented a more stringent enforcement scheme for refrigerant management. “In Italy, we had the adoption of a new law, entering into force January of this year for the training and certification of equipment providers and refrigerant installation companies,” he says. “Contractors and services companies have to be certified to be allowed to perform any activity related to the refrigeration system. This is not new for our market in Italy. For several years, we have this requirement of certification; only, the process of training and certification is more strict, structured and more reinforced than ever before.”

The same law, Matrapasqua says, states that any official information related to operations performed on an F-Gas System will be downloaded in the country’s main database. “Whatever you do on an F-Gas system, whether you charge, adjust or check leakage of refrigeration, the details must be properly transmitted to the national database for a better control of these F-Gas refrigerants,” he says. “Laws and regulations on F-gas are more and more strict to ensure perfect control. If you choose natural refrigerants, there are less obligations and controls, so there is very strong discrimination in Italy. Of course, this drives the market to choose much easier refrigerants than F-Gas.”

Mastrapasqua believes that the narrative surrounding refrigerants in Europe is only the beginning of a trend that is already going global. “We believe the market is going to accept, more and more, natural refrigeration and CO2 systems, because they are the only sustainable solution for the future,” he says, with F-Gas, in Europe, and Kigali amendment, worldwide, driving forces in this direction.

Travaglin offers an example, as Carel, taking the key learnings from operations in Europe has released EmJ (Electronic Modulate Ejector) as the latest solution to allow trans-critical CO2 systems to work even in high-temperature climates. “In the Middle East,” he says, “close cooperation between Carel and the main OEMs in the region has created the opportunity to develop the first C02 supermarket, an UNIDO project in Amman, and a new supermarket in Masdar city in Abu Dhabi.”

Mastrapasqua says the industry is working towards making the system available and applicable globally. There will be a natural progression, more or less, everywhere in the world, he says. “Of course, at different times,” he admits, “but sooner or later, this is going to be accepted as the only solution.”