When will the crunch come? When will the demand for R-22 surpass the supply? For a number of years the best guess was around 2015 when the phase down in the production of R-22 would no longer be offset by an adequate reclamation effort on the part of contractors.

But new findings are predicting that the crossover year could be much earlier.

“The recent Montreal Protocol changes and an updated look at supply-demand scenarios reveal that supplies in 2010 may be much tighter than originally anticipated, including the possibility that virgin R-22 supplies may be short,” said Kevin P. O’Shea, North American marketing manager for DuPont Refrigerants.

“Therefore, it is apparent that the industry must dramatically increase recovery of HCFCs in order to compensate for the shortfall expected as early as 2010.”

O’Shea noted the change that is having the greatest impact on the U.S. HVACR industry is the 75 percent reduction of HCFCs by 2010 versus the original consumption cap of 65 percent.

“A review of the projected 2010 HCFC demand versus the newly revised Montreal Protocol limit reveals that the industry should be taking immediate actions to reduce its dependence on refrigerants that contain HCFCs and to transition to non-ozone depleting HFC alternatives,” O’Shea said.

“Equipment owners that have a large base of HCFC systems in place today will need to actively implement plans to retrofit or replace equipment so they have sufficient time and budget for an orderly transition away from HCFCs.”

He went on to say, “Unless the HVACR industry immediately steps up actions and promotes techniques to ease demand for HCFCs and minimize potential supply shortfalls over the next eight years, accelerated HCFC phaseout targets in 2010 may significantly impact the availability and cost of R-22 in the marketplace sooner than originally thought. Contractors and equipment owners can mitigate the potential for a shortfall by taking action now to reduce demand for R-22 and reclaim the supply that is currently available. Additionally, they can implement proper maintenance and repair practices to increase the amount of viable R-22 that can be reclaimed.”


O’Shea factored in the recently accelerated phaseout schedule for R-22 with what is currently perceived as an inadequate effort in recovery-reclamation to come up with the predictions.

He noted, “At the 19th meeting of parties to the Montreal Protocol in September, delegates agreed to accelerate the phaseout of R-22 and other HCFCs as a means of further protecting the ozone layer. Under the newly revised Montreal Protocol, developed nations are obligated to meet the accelerated schedule through reduced consumption of HCFCs by specific dates.”

Those dates as listed at www.arap.org were:

Jan. 1, 1996:Consumption freeze capped at 2.8 percent of the ozone depletion potential of the CFCs plus the HCFCs consumed by a country in 1989.

Jan. 1. 2004:Cap reduced by 35 percent of above.

Jan. 1, 2010:Cap reduced by 75 percent.

Jan. 1, 2015:Cap reduced by 90 percent.

Jan. 1, 2020:Cap reduced by 99.5 percent; for service only, all countries.

Jan. 1, 2030:Cap reduced by 100 percent.

The September 2006 revised draft report from the Environmental Protection Agency (EPA) titled, “The U.S. Phase-out of HCFC Projected Servicing Needs in the U.S. Air-Conditioning and Refrigeration Sector,” outlined several assumptions about the amount of reclaimed R-22 needed to satisfy United States demand after 2010.

“EPA’s assumptions were based on a 10 percent and 50 percent HCFC recovery rate from retired and retrofitted equipment. Based on industry numbers, DuPont estimates the amount of R-22 reclaimed by EPA-certified reclaimers has been less than 10 percent,” O’Shea said.

According to this report, the original 2010 HCFC consumption cap was 96,980 metric tons (MT). Under the newly revised Montreal Protocol, the new U.S. HCFC consumption cap in 2010 will be no higher than 69,270 MT. The report evaluated a scenario in which 90 percent of the HCFC cap would be allocated to R-22, which would represent a supply of 62,345 MT, or 91 percent of the total cap. The report also estimated that R-22 demand for servicing existing equipment in 2010 would be 68,600 MT.

Based on a scenario that assumes 10 percent of R-22 is recovered, only 5 percent of the market demand would be met by this recovered refrigerant. The 62,345 MT of virgin R-22 would cover only 91 percent of market need, leaving a 4 percent (2,555 MT) shortfall.

Based on a 50 percent recovery scenario, 27 percent of the market demand would be met with recovered refrigerants. Enough virgin R-22 would be necessary to cover the remaining 73 percent.

The EPA anticipates a 10 percent reduction in demand between 2010 and 2015. Therefore, estimates for 2015, the next target phaseout date, will remain unchanged from previous calculations.

In 2015 the industry will have an estimated servicing demand of 43,400 MT, which exceeds the 24,938 MT manufacturing cap (based on 90 percent of cap allocated to R-22) by 57 percent. Based on a 10 percent recovery scenario, only 10 percent of market demand would be met with recovered refrigerants.

Virgin R-22 would meet approximately 57 percent of demand, leaving a 33 percent supply shortfall. Based on a 50 percent recovery scenario, recovered refrigerant would satisfy 52 percent of the market need, which is enough to mitigate an industry-wide supply shortage of R-22. Virgin refrigerant would meet the remainder of market need, approximately 48 percent.

Limited virgin manufacture will be allowed for servicing existing equipment through 2020. At that time, the projected servicing demand will be approximately 20,500 MT.

Based on a 10 percent recovery scenario, recovered refrigerant would satisfy 21 percent of the market need, leaving a 79 percent shortfall. Based on a 50 percent recovery scenario, recovered refrigerant would satisfy 100 percent of the market need.


“These amended calculations should reduce the market’s comfort with the supply and demand picture that was originally projected. However, the new estimates represent only the minimum level of adjustment,” O’Shea said.

He said the United States is currently determining what its accelerated schedule will be under the U.S. Clean Air Act (CAA) by regulating HCFC allocations (cap) in order to meet its obligation under the Montreal Protocol’s accelerated timetable.

The rulemaking is required because the current rule, “Protection of Stratospheric Ozone: Allowance System for Controlling HCFC Production, Import and Export,” which was issued in 2003, expires at the end of 2009. Therefore, the EPA will issue a new allocation rule effective 2010.

If the agency chooses to be more aggressive in setting phaseout targets, the scenarios presented above will likely change, further increasing the possibility and magnitude of an R-22 shortfall in 2010.

He added, “The cost of R-22 in 30-pound cylinders has more than tripled over the last five years. This is another critical factor urging equipment owners and contractors to develop plans and increase their service and recovery practices to allow for an orderly transition away from HCFCs.”

One way that contractors and equipment owners can immediately reduce demand for R-22 and decrease the possibility of a supply shortage is to transition to non-ozone depleting refrigerants, such as hydrofluorocarbon (HFC) retrofit options, which are cost-effective, easy to use, and help to minimize business disruption.

For more information, Kevin P. O’Shea can be reached via e-mail at Kevin.P.Oshea@usa.dupont.com.

Publication Date:12/10/2007