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May 2, 2005: Replacement, Conversion Of CFC Chillers Slower Than Expected

May 2, 2005
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ARLINGTON, Va. - Manufacturers of chillers used for comfort cooling in buildings replaced or converted 2,753 units that use chlorofluorocarbon (CFC) refrigerants during 2004, leaving an estimated 33,300 chillers still using CFCs. The use of CFC refrigerants in new equipment was banned under the Montreal Protocol at the end of 1995 due to concerns about CFCs eroding the earth's ozone layer.

The annual survey of chiller manufacturers by the Air-Conditioning and Refrigeration Institute (ARI) showed that building owners in the United States, as of Jan. 1, 2005, had replaced or converted 46,703 units, or 58 percent, of the 80,000 CFC chillers in use at the end of 1995. At the current pace, it will take more than 10 years to replace all the CFC chillers in operation today.

According to ARI, during 2004 there were 176 conversions and 2,753 chillers replaced with non-CFC equipment. The pace of the phase-out has been slower than expected due in part to federal tax laws, which require depreciation of the chillers over 39 years.

Congressman Peter Hoekstra (R-Mich.), a member of the Congressional Manufacturing Caucus, has introduced legislation, entitled H.R. 1241, the "Cool and Efficient Buildings Act," which will reduce the depreciation period from 39 years to 20 years for "any property which is part of a heating, ventilation, air conditioning, or refrigeration system and which is installed on or in a building which is non residential real property."

According to Hoekstra, "The current 39-year depreciation period on HVACR systems is not reflective of their average life span, and it is not cost effective. The Cool and Efficient Buildings Act will provide an incentive for businesses to invest in new equipment, which will save businesses money in the long run and provide another stimulus to the U.S. economy."

The legislation notes that the tax code change would decrease the nation's energy consumption by taking advantage "of the remarkable increase in energy efficiency due to technological advances" achieved by the air conditioning industry.

Building owners have replaced 37,643 and converted 9,060 CFC chillers, leaving an estimated 33,297 still in service, most of which use CFC-11 or CFC-12 refrigerants. ARI manufacturers estimated there will be 155 conversions and 2,674 replacements during 2005, bringing the total converted and replaced to 62 percent of the total by Jan. 1, 2006.

For more information, visit www.ari.org.

Publication date: 05/02/2005

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