Raft of recommended natural substitutes signals death knell for HFCs in China

China has underlined its intention to facilitate a comprehensive market shift towards natural refrigerant technology in a draft list of recommended substitutes for HCFCs, which are likely to be followed swiftly by substantial policy evolution, subsidies and incentive schemes to further promote natural refrigerants in the region.

Published on June 5 by China’s Foreign Economic Cooperation Office, Ministry of Environmental Protection (FECO), ‘The First Catalogue of Recommended Substitutes for HCFCs’ lists 12 substitutes for HCFC refrigerants, foaming agents and detergents – 10 of which are natural chemicals including CO₂, ammonia, hydrocarbons and water.

In a clear indication of the government’s mindset as China turns its back on HFCs, the publication, collated by market intelligence firm CCM, is likely to be swiftly followed by substantial policy evolution further promoting natural refrigerants.

The Catalogue is the product of extensive market research by CCM into policies designed to transition away from HCFCs and fulfill China’s obligations to the Montreal Protocol.

The Catalogue explained

The citation of only one HFC in the Catalogue – R32 (with a GWP of 675) for unitary air conditioners, water chillers, heat pump water heaters, and condensing units – suggests China’s clear strategy to shift to natural refrigerants in as many applications as possible.

The government listed refrigerants and applications, which are currently installed and proven to be working in China. The catalogue does not include applications, which are demonstrated in other countries or which are showing potential. Nevertheless the intention is to update the catalogue as technologies become available in China.

Meanwhile, the presence of CO₂ for mobile air conditioners, ammonia for condensing units and propane (R290) for room air conditioners represents a huge potential shift in power towards natural refrigerants after the chemical giants heavily lobbied against them. Conversely, HFC R32 was not listed as a substitute for RAC.

Suggested natural refrigerants to replace R22 by application:

Propane (R290): Room air conditioners, stand-alone refrigeration
Isobutane (R600a): Stand-alone refrigeration
CO₂ (R744): Household heat pump water heaters, industrial & commercial heat pump water heaters, MAC, industrial/commercial freezing and refrigeration (transcritical and secondary refrigerant)
Ammonia (NH₃): Refrigerated warehouses, transport refrigeration, condensing units, industrial refrigeration

Previously, HFCs have encroached on the Chinese market as substitutes for HFCs – namely R134a in the vehicle air conditioner market, R410a in domestic air conditioners, and in the foaming agents and detergents markets.

However, according to CCM research operating rates for R134a have fallen by over 30% in China since 2012 and are currently under 50%.

Now, with the full weight of government support for natural refrigerants imminent, these green alternatives are likely to increase their market share in China substantially over the next few years, while the path to extinction for HFCs looking considerably shorter.

Industry feedback welcomed before June 30

The government will canvass opinions from stakeholders and the public until June 30 before practical policy frameworks are put in place to support natural substitutes for HCFCs.

If history is a guide then the draft suggestions are likely to become a reality. In 2012, when China announced its intentions to promote R290 as a replacement for R22 in domestic air conditioners, the government introduced several supportive policies to aid the transition.

These included an agreement to help air conditioner manufacturers overhaul their production lines in 2013, new subsidies for the production and marketing of R290 air conditioners in 2014, and the introduction of a new ‘Environmental Protection and Low Carbon Label’ in 2015 to encourage consumers to choose green air conditioners.

GUIDE to Natural Refrigerants in China – State of the Industry 2015

For more information on the business case for natural refrigerants in China, download shecco’s GUIDE China 2015, include the insights of nearly 1,100 responses from the Chinese HVAC&R industry on the opportunities and remaining challenges for natural refrigerants.

“This GUIDE is the most up-to-date and comprehensive report about the current use of, and future potential, of natural refrigerants in China. It puts forth evidence that a stronger focus on environmentally sustainable, and at the same time economically viable HVAC&R technologies, can solidify the (China’s) position as a world leader in a range of sectors, such as NH₃/CO₂ industrial refrigeration, CO₂ heat pumps, R290 room air conditioners, CO₂ supermarkets, and in f-gas free light-commercial refrigeration,” Lead Author GUIDE China 2015 and Deputy Managing Director shecco, Nina Masson.

The GUIDE features a range of detailed market maps, showing the distribution of natural refrigerants in the industrial, commercial and light commercial refrigeration sectors, in heat pumps, as well as in room air conditioners throughout China.