According to the U.S. Environmental Protection Agency (EPA), 10,804,918 pounds of ozone-depleting refrigerant was reported as reclaimed by EPA-certified reclaimers in 2016. That total includes 9,409,494 pounds of hydrochlorofluorocarbon (HCFC)-22 or R-22.
The 2016 numbers are up from the 9,514,001 total pounds and 7,812,805 pounds of R-22 reclaimed in 2015 but are below the highest-ever numbers of 12, 553,327 pounds total and 10,045,071 pounds of R-22 in 2008.
Those numbers aren’t insubstantial — there’s no denying that 10.8 million pounds is a lot of refrigerant — and it’s a tribute to the industry’s contractors and technicians that so much refrigerant is making its way back to be reclaimed to meet the purity standards of Air-Conditioning, Heating & Refrigeration Institute (AHRI) Standard 700. However, 10.8 million pounds is a disappointing number when viewed through the lens of what the EPA projected would be recovered, which, by various estimates, ranged from two to four times the 2016 levels.
So, where is the unreturned and unreclaimed R-22? Are contractors stockpiling it, legally reusing it in the same customer’s equipment, illegally using it in other customers’ equipment, or — worst of all — venting it to the atmosphere? The answers are maybe, maybe, maybe, and … yeah, maybe.
NOT ALL DOOM AND GLOOM
An EPA spokesperson noted that 20 percent more R-22 was reported as reclaimed in 2016 than in 2015. Additionally, the EPA data on the amount of refrigerant being sent to reclaimers show that the amount of R-22 returned for reclamation (although not yet reported as reclaimed) more than doubled between 2015 and 2016.
The spokesperson shared some basic reminders with The NEWS: New production and import of R-22 in the U.S. will cease in 2020, making proper recovery and reclamation especially important. To prevent the sale of potentially contaminated refrigerant, the EPA requires used refrigerant be reclaimed before it can be resold to a third party for use in an appliance.
“Owners and operators of multiple appliances may be keeping their recovered HCFC-22 to allow them to more easily service appliances they intend to continue operating well into the future,” the spokesperson said. “EPA does not collect data on the reuse of refrigerant. Increased reuse could reduce the amount of refrigerant sent for reclamation. Finally, the venting of refrigerant, while always illegal, is now a poor economic decision and deprives the market of that supply.”
BEWARE OF BAD ACTORS
Todd Washam, director of industry and external relations, ACCA, said good contractors are following the law, recovering and reclaiming R-22, because they care about the environment and because the ramifications present too great of a risk.
“We have not seen ACCA members stockpiling R-22 or illegally reusing it in other customers’ equipment, but we do know that EPA’s enforcement of refrigerant venting and leakage laws is pretty much nonexistent,” Washam said. “That lack of enforcement enables unlicensed and unqualified so-called contractors to undercut legitimate contactors.”
Washam said consumer education may be helpful in removing the bad actors from the equation.
“Good contractors will spend time properly recovering refrigerant, and that represents man-hours they have to build into the price,” he said. “But the unlicensed and unqualified guy walks up and gives a price that doesn’t include refrigerant recovery, and the homeowners go with the low price and never know any better.”
Richard Pelati, vice president, USA Refrigerants, said the situation is not as simple as good contractors versus bad contractors; it’s a case of the burden of reclamation not being evenly distributed by all the parties involved.
“What has basically happened is that the full burden of this reclamation process has been put on contractors,” Pelati said. “The economic burden is on them, the compliance burden is on them, and education of the consumer is on them.”
According to Pelati, economics is the key to changing the situation. He noted the price of R-22 has been dropping to the point that it’s now easier and less expensive to access a virgin molecule of R-22 than a reclaimed molecule.
Pelati suggested that an allowance system similar to what was put in place for chlorofluorocarbons (CFCs) would present a long-term solution.
“What we need to do is give these refrigerants a value,” he said. “There were model allocation and floor stock tax programs in the Clean Air Act for CFCs and HCFCs that drove the price because limited people had access to the refrigerant and could put a value on it. Why they have not applied both models to HFCs is beyond me.
“The big picture in making reclamation viable is creating an environment that’s conducive to recovery, and that means distributing the burden equally,” Pelati continued. “Right now, the economic burden is on the people least able to handle it financially or logistically — reclaimers and contractors. The economics of reclamation doesn’t benefit contractors at all.”
A STEADY STREAM
Carl Grolle, president, Golden Refrigerant, Livonia, Michigan, said since the recovery and reclamation rules became part of the Clean Air Act, the gross amount of refrigerant turned in to the reclamation industry has remained pretty constant. To him, this indicates that contractors are not necessarily stockpiling R-22 or mismanaging it but may be a case of inaccurate assumptions made by the EPA.
“The EPA has been guilty on a couple of occasions of making some assumptions that, on the surface, sound reasonable, but, in reality, are just completely off base,” Grolle said. “The amounts have been constant, and only a few things over the years have moved the needle, and even then, it has moved very little.”
According to Grolle, the numbers boil down to the fact that there is a certain steady base of mechanical contractors who always do their best to follow the laws. To them, doing what they’re supposed to do and doing it consistently is just part of the job.
“In my experience, this really applies to the higher tonnage guys and the established guys in the bigger shops,” he said. “The people who want to follow the laws, and whose customers expect them to follow the laws, are following the laws. And that’s why we’re getting a rather consistent return year after year regardless of what’s happening in the market.”
Grolle said the EPA may have simply overestimated the amount that would be collected each year or may have proceeded under the assumption that a scarcity of one refrigerant would cause the numbers to change. And while that may seem logical, it has never happened.
“The case can be made that on paper, there should be more than 15 million pounds of refrigerant being turned in to reclaimers every year,” Grolle said. “Maybe some contractors are stockpiling it, and maybe some are letting it fly. As the amount of gas that has been turned into the reclamation industry has been very consistent year in and year out, my view is simply that’s our pool of available material. I’m not expecting any magic pixie dust to come along and change it. If it does, I’ll be happy to work with it, but I think maybe that’s just our market.”
PROCESS AND RETURN
Jay Kestenbaum, senior vice president, sales and purchasing, Airgas Refrigerants, said he is seeing an increasing number of contractors who are wanting to “process and return” their refrigerants rather than selling back recovered R-22 to a reclaimer — a trend he attributes to the rising prices of new R-22.
“We also have seen multi-location customers move more toward using their own recovered refrigerants in their other locations rather than return those gases for reclamation,” Kestenbaum said. “They are then sourcing new product for future use.”
Kestenbaum reminded contractors that although the price of R-22 has not continued to spiral upward the past several months, in just two years — Dec. 31, 2019 — manufacturers will no longer be producing R-22.
“The phasedown and elimination of new R-22 will certainly result in continued shortages due to expected demand to service the enormous base of installed equipment, which can continue to operate long into the future,” he said. “We fully expect the continuation of increased pricing as the supply/demand imbalance continues.”
Gordon McKinney, vice president and COO, Icor Intl. Inc., said there are a number of factors that have contributed to low reclaim rates of R-22, but the primary reasons are reuse, leak rates that have always been grossly underestimated, and the lack of enforcement of existing federal regulations.
According to McKinney, many technicians and equipment owners have determined that reusing recovered R-22 is a more practical option than reclaiming the refrigerant. He said that although the practice of reuse does pose a number of safety and financial risks, for many, the risk does not outweigh having to deal with the reclaim process.
In regards to enforcement, McKinney noted that there have been a small number of high-profile prosecutions and a few sizable fines levied from refrigerant regulation infractions.
“However, I doubt you could find many people in our industry who would disagree that the EPA has never had the wherewithal to adequately enforce the majority of the regulations that pertain to refrigerant handling and use,” McKinney said. “For all practical purposes, it has been, and continues to be, much of an honor system that puts many law-abiding companies at a serious disadvantage. From my perspective, I see no evidence of widespread stockpiling of R-22 and do not see any practical way to boost R-22 reclaim levels to much more than what they are today, which are nearly three times lower than the estimates made by the EPA and many others associated with the reclaim industry.”
The contractors on the front lines told The NEWS they are not stockpiling or mismanaging refrigerants, but everyone has seen evidence that others are.
Kevin O’Neill, owner, O’Neill Cooling & Heating, Myrtle Beach, South Carolina, contends that a more likely scenario than contractors stockpiling R-22 is technicians not recovering it at all.
“Some contractors are recovering and keeping the refrigerant but not many,” O’Neill said. “I asked at my local supply houses, and they estimated that only about 25-35 percent of contractors recover refrigerant and turn it in, so it can be reclaimed.”
The others? O’Neill said they are either venting it or reusing it in other customers’ systems — both of which are illegal.
“The EPA doesn’t have enough people to go around and enforce it, so technicians figure if they’re not going to get caught, they’re not going to follow the rules,” he said.
Although contractors in his area can get paid about $5 per pound of recovered refrigerant, O’Neill said that is not enough of an incentive to sway those who prefer to save labor time by venting.
In addition, that $5 per pound payment assumes the refrigerant hasn’t been contaminated by technicians topping off a system with one of the R-22 alternatives on the market.
“The manufacturers of R-22 alternatives make it clear their products are not to be used to top off R-22 systems, but some technicians do it anyway,” O’Neill said. “When you don’t care, you don’t care. They don’t like the regulations, so they choose to ignore them.”
Although he’s aware of and unhappy about the bad practices some technicians and contractors engage in, O’Neill noted those who care about the law and the environment are doing the right thing every day.
“We can only control what we do,” he said. “We’re a small company, and I know it’s unlikely we would ever get caught, but there are severe financial penalties and even prison time for not following the EPA’s refrigerant handling rules. So, not only is it the right thing to do, it’s also not worth the risk of not doing it.”
Ray Isaac, president, Isaac Heating and Air Conditioning Inc., Rochester, New York, said his company has very little to no discussions about R-22.
“It is not an area of concern or focus for us,” Isaac said. “We have moved on to new refrigerants. In our opinion, to hold on to R-22 equipment or to stockpile refrigerant is like hanging on to your coal stove and stockpiling coal. We have some older refrigeration units that still are R-22, but, for the most part, it’s a non-issue in Isaac Land.”
Tom Casey Jr., chief quality officer, Climate Partners, Milford, Connecticut, agreed with Isaac, saying he believes contractors have accepted that R-22 is obsolete — and just as with other obsolete technologies, they’re not going to try to force a square peg into a round hole, let alone stockpile it.
“It’s not worth the squeeze to get the juice from R-22 sales,” Casey said. “It’s easier to simply upgrade the systems. Plus, government regulations and price escalations have ‘worked’ in the sense that costs have increased so much that it’s no longer cost-effective to keep an old residential R-22 system running.”
Casey said the low reclaim numbers could be the result of leaking systems. When all the refrigerant has leaked out, there’s nothing to reclaim, but there is a contingent of bottom feeders who continue to vent refrigerant.
“It’s surprising how many fly below the radar,” he said. “Legitimate companies with logoed trucks tend to play by the rules, and low-budget companies don’t. “It’s kind of like an IRS audit,” Casey continued. “It’s the legit taxpayer who gets his ticket punched while the criminals who don’t pay taxes don’t even get audited.”
So, dear readers, the explanation for the low reclaim numbers and the answers to where the “missing” R-22 is going may be in your hands or, better yet, your recovery cylinders.