As most of you know there is pending legislation within the United States Senate that aims to phase down HFC refrigerants across the country. It is titled the ‘S.2754 – American Innovation and Manufacturing Act of 2019.‘ I wrote about this when it was first introduced back in October of 2019. This legislation is yet another attempt to push HFC refrigerants out of use in the United States. We’ve seen the EPA’s SNAP rules from 2015 get over turned. We’ve seen the Kigali Amendment stall. Will it be any surprise if this proposed bill stalls as well? I think not.
That being said it does appear that the bill is picking up steam within the Senate. I took a look at the bill today and noticed that it now has thirty-three Senators as cosponsors. While there are still many hurdles to get through it may be time to start taking it seriously. As I said earlier the bill aims to phase down HFC refrigerants across the country. This covers all of your popular refrigerants such as R-134a, R-32, R-125, and R-143a. (There are others as well, for a full listing visit the actual bill text.) It should be noted that while R-410A and R-404A are not mentioned their components are… and if the components are phased down then the blends will be too.
Just like with other phase downs the approach is staggered over multiple years. The aim is to reduce usage based off of the baseline usage quotas from January 1st, 2011 to December 31st, 2013. The timeline is rather generous giving nearly sixteen years to achieve their final phase down goal. The proposed timeline in this bill looks like this:
Date
% of Production Baseline
% of Consumption Baseline
2020–2023
90 percent
90 percent
2024–2028
60 percent
60 percent
2029–2033
30 percent
30 percent
2034–2035
20 percent
20 percent
2036 and thereafter
15 percent
15 percent.
What is pushing this bill though folks is not the timeline but the benefits. Yes, according to the bill if we move forward with this plan to phase down HFC refrigerants then the United States will see thirty-three-thousand new manufacturing jobs created, billions invested into innovation/research, and over twelve billion per year in positive trade balance. At first glance who wouldn’t vote for this? It seems like a ‘jobs’ bill. Since its introduction I have seen very little arguments against it. It has been mostly positive from the larger players within the industry so it definitely got my attention when I found a dissenting opinion that was submitted to the Senate.
The Argument Against
At this point the bill is still in the Senate Environment and Public Works committee and has not been pushed to the Senate for a vote. In an effort to gain more knowledge on the industry and the impact of the potential bill the Senate introduced an information gathering session between March 25th and ending on April 8th. This period allowed submission of written testimony from any parties. There was also a similar period for questions to be submitted that ended on April 15th another period for answers to be submitted to the committee by April 29th (Tomorrow).
It was during the first period we had mentioned, March 25th to April 8th, that we saw the submission of a written testimony from Dave Stevenson at the Caesar Rodney Institute. The testimony can be found by clicking here or by visiting our sources page at the bottom of this article. There are a few arguments that he presented. The first is the assumption that if we pass this bill then the United States will become a leader in refrigerant technology which will cause a trade balance surplus in the billions. But as he argues, since the year 2000 the trade imbalance has been growing. Each year the United States is importing more and more refrigerant and related equipment while our exports are only slightly growing. The majority of these imports are coming from Mexico and Canada with China and Korea not too far behind. So, what will stop this from continuing? How will this bill incentivize these companies to start manufacturing in America again? Will we really see the new jobs that the bill promises?
The other argument, and the biggest one, is the factor of cost. As we all know the cost of HFC refrigerants versus the cost of HFO refrigerants is dramatic. For a perfect example just look at R-134a versus R-1234yf. R-134a can be anywhere from three to five dollars a pound. 1234yf can be anywhere between fifty to seventy dollars a pound. In the best case scenario we are still looking at a nine-hundred percent increase in cost.
Who will be paying this extra cost? All of this will be an extra burden on businesses and eventually end user consumers. Again, going with the car example we could see standard air conditioned repairs see their price tag raised by over a one-hundred dollars all because of HFC versus HFO refrigerant. Now imagine this extra cost passed on all air conditioning and refrigeration equipment found in homes, offices, gas stations, grocery stores, and everywhere else. There will be a significant impact to businesses and end users.
Conclusion
I believe Mr. Stevenson makes some valid points here. When the bill was proposed back in October I was very skeptical of the thousands of jobs and the billions of dollars of increased revenue. It all seems like a pipe dream that is told so that we can finally phase down HFC refrigerants. It is difficult to say if the promises in this bill will hold true. That being said, I believe we do need a comprehensive HFC legislation passed at the Federal level. Otherwise we are going to have a smattering of various state regulations that all vary slightly from state to state. This will make business difficult and burdensome for manufacturers and contractors. Having one centralized policy across the country will make things much easier for everyone.
Earlier this week the United States Department of Commerce (DOC) made a preliminary ruling on hydroflurocarbon refrigerant components coming in from China. The components are brought into the United States and then mixed or blended domestically in an effort to get around the 2016 antidumping tariffs. The 2016 ruling installed tariffs on the blended HFC refrigerants themselves such as R404A, R407A, R407C, R410A, and R507A. Because this ruling did NOT pertain to the actual components of these blended refrigerants the United States saw an over four-hundred percent increase in imports of R-32, R-125, and R-143a in the years after the initial 2016 ruling. To top it off, there was also nearly an eighty percent decrease of finished HFC blends being imported into the United States. It was obvious to anyone watching that the tariffs from 2016 had no impact.
It was in early April of last year that a new antidumping circumvention case was launched with the Department of Commerce. This case focused instead on the actual components to create these refrigerant blends. After some months of debate the DOC announced an official inquiry investigation would began in June of 2019. Since then it had been relatively quiet up until this week where the DOC preliminarily found that the imports of these refrigerant components are indeed circumventing the previous antidumping order. As a result of this the DOC ordered that Customs and Borders Protection suspend liquidation on these imports and also require large cash deposits on imports of the impacted refrigerant components.
Now I’ll be the first to tell you that I am not an import/export expert. At the time of writing this article I wasn’t fully aware what liquidation was when it came to customs enforcement. But, like anything, it can be learned. From my understanding and research the act of liquidation with imports is an agreement between Customs and Border Protection and the importer on duties, fees, and tariffs of the shipment. The CBP normally has a 314 day period from the time of import to the date of automatic liquidation. During this time the importer and CBP may go back and forth determining the proper fees that are owed. After the liquidation has occurred though the importer can no longer be responsible for tariffs or other new fees that occurred after… unless:
The one-year statutory liquidation requirement may also be suspended by statute or due to court action. Actions that might suspend liquidation include countervailing or anti-dumping duty investigations. Because the entry remains open, the importer is liable for any duty orders resulting from resolution of these investigations.” – Source ShippingSolutions.com
This is exactly what the DOC ruled this week on these HFC component refrigerants. The DOC ordered CBP to suspend liquidations on R-32, R-125, and R-143a as of June 18th, 2019. (The initial date of the investigation.) What this means is that all of the products that were imported at or after June 18th, 2019 COULD be subject to tariffs if the Department of Commerce rules in favor of the antidumping duties. The DOC is also requiring cash deposits to be submitted in estimation of what the proposed tariffs will be (Ranging from 101.82 to 285.73%). Lastly, the DOC announced that their final decision on this has been pushed back to July 2nd, 2020.
As you can imagine there is still quite a bit that is unclear at this time. I cannot imagine the position business owners or importers are in if this gets passed. Having to pay duties on product that you brought in nearly a year ago… that has most likely already been sold. It is going to hurt. This holds especially true the way the economy is right now. This latest news this week has also caused the prices on HFC refrigerants to rise and rise. A major refrigerant manufacturer announced that they were suspending all of their published pricing until further notice. This just shows you how much of an impact this ruling had on the marketplace. Now normally when we see this huge price increase it starts to settle back down… and we may see that as the final ruling is still three months away.
Lastly, there is a glimmer of hope for some companies out there. The DOC has said that they may entertain exclusions to a positive antidumping ruling. These exclusions could apply to companies who import these components but claim that they are NOT blending the refrigerant and are using it for other means. There was also talk of exclusion if the company doing the importing is an HFC refrigerant manufacturer as well. This can get a little gray though as what constitutes a manufacturer? If I am blending in house does that make me a manufacturer? Personally, I feel like these exclusions could get us down a rabbit hole and eventually lead us to more loop holes for companies to get around tariffs.
But Wait Folks… There’s More!
Another angle of this story folks is that it is not just about China anymore. Yes, it really has always been about China but there has been yet another loophole found since the 2016 ruling on HFC blended refrigerants. This time we had companies importing the Chinese blended refrigerants into India and then American companies buying these products from India. Along with our previous topic there was a second preliminary ruling decided this week by the DOC:
Further, in response to a request from the American HFC Coalition (the petitioners), we initiated an anti-circumvention inquiry, pursuant to section 781(b) of the Tariff Act of 1930, as amended (the Act), and 19 CFR 351.225(h), to determine whether HFC blends, containing HFC components from India and China, that are blended in India prior to importation into the United States, are subject to the Order. Based on the information submitted by interested parties and the analysis below, we recommend that, pursuant to section 781(b) of the Act, Commerce preliminary find that imports of HFC blends R-404A, R-407A, R-407C, R-410A, and R-507A/R-507 produced in India using one or more HFC components of Chinese origin, that are blended in India prior to importation into the United States, are circumventing the Order.”
The full scope of this antidumping investigation covers HFC blends R-404A, R-407A, R-407C, R-410A, and R-507A/R-507 produced in India using one or more HFC components of Chinese origin. This investigation started on the same day of the previous one, June 18th, 2019. In some cases the companies were importing fully blended product from China to India and then to the United States.
In other cases though R-32 would be imported from China to India and then an India company would blend it with domestic R-125. They would then import the finished R-410A product from India into the United States. You see the first way of importing the fully blended product from China and into India didn’t work as well as they still had to state the country of origin on their commercial invoice… but by doing some of the blending process in India they could claim that the country of origin was India.
For the reasons discussed above, and in accordance with 19 CFR 351.225(d) and (k)(1), we recommend finding that R-410A from India is not within the plain scope language of the Order because the Order covers HFC blends from China. However, U.S. imports of HFC blends from India consist of components imported from China, which are further blended in India into subject HFC blends, prior to being exported to the United States. Therefore, we recommend that, pursuant to section 781(b) of the Act and 19 CFR 351.225(h), Commerce issue a preliminary affirmative circumvention determination that imports of HFC blends R-404A, R-407A, R-407C, R-410A, and R-507A/R-507 produced in India using one or more HFC component of Chinese origin, are circumventing the Order.”
At this time it is not known exactly what percentages will be installed on these imports from India but in the document was a referenced amount of 216.37 percent. If this does go into effect then the India manufacturer will have to prove to the CBP that they have not bought or imported any Chinese refrigerant components in the last twelve months. So, the proposed tariff isn’t necessarily on India… but China.
Conclusion
All of this folks just seems to be a game of whack-a-mole. It seems that when the Department of Commerce makes a ruling it only takes a few months for some businesses and companies to find a loophole to get around it. Everyone is looking for that competitive edge… even if it isn’t the most ethical way to do it. After this summer passes and these two anti-dumping cases have either been passed or rejected there will always be more. That I can assure you. Heck, just a few months ago there was another new antidumping filed on R-32. Who knows what the next one will be…
So, the only real question I have here is if retroactive duties are imposed can the companies who have been importing survive the hit? Can they survive those tariffs coming all at once? Or, will we begin to see a consolidation the marketplace by having some companies fold?
Yesterday a Federal Court of Appeals ruled against the Environmental Protection Agency. This is a bit different then what we have seen over the past few years. In previous rulings the courts have been ruling against the Obama Era regulations and policies. This time though the court’s ruling struck down a rule made by the EPA during the Trump Administration. The court restored a prohibition on switching from ozone depleting substances to HFCs in uses such as large refrigeration systems in supermarkets.
In other words, lets say you have a supermarket that is running an old HCFC R-22 system. It needs to be replaced and soon before a major failure occurs. During the Obama EPA and up until a few years ago you would NOT be able to replace your R-22 system with a high Global Warming Potential HFC refrigerant as this was seen as harmful to the environment. Instead business owners had to work with more climate friendly refrigerants such as R-744, R-717, hydrocarbons, and the newer HFO lines from Honeywell and Chemours. These refrigerants had a low GWP number and had no Ozone Depletion Potential.
As most of you know, in 2017 a federal court ruled against the EPA’s suggested HFC phase down plan. The plan, known as SNAP Rules 20 and 21 aimed at phasing down high GWP HFC refrigerants such as R-404A and R-134a. About a year after this ruling the Trump Administration’s EPA announced that they would be rescinding all HFC regulations in response to the previous year’s court ruling. We also just saw another ruling by the EPA similar to this a few months ago when they announced they were removing the HFC leak regulations. (Article can be found here on this.)
In reference to today’s court decision, the EPA’s actions in 2018 allowed business owners to move their R-22 HCFC system over to an R-404A HFC system. This is what the court restored yesterday. The courts ruled that the EPA acted illegally in 2018 when it vacated this particular rule. The reason for their ruling was that the EPA did not allow for a notice and a comment period on their 2018 announcement to rescind the HFC regulations.
The case itself was pushed shortly after the EPA’s announcement in 2018. It was brought by the National Resource Defense Council (NRDC) and a collection of states with New York leading the way. Obviously, I have not ready every page of the documents but I was able to pull some excerpts from the document itself as well as from some of the key players.
The Mexichem court struck down (or, “vacated”) only part of the HFC rule. It upheld and left in place other parts of the rule. But the Administrator lifted the entire HFC rule – even the parts the court approved. And he did it with no rulemaking. No proposal, no opportunity to comment. This is doubly unlawful. ” – Lissa Lynch from NRDC
Another quote, this time from the court ruling document itself:
Notice and comment rule making is a central part of the administrative framework set forth in the APA and the Clean Air Act. When an agency issues a legislative rule by exercising its delegated authority to establish new obligations with the force of law, it must follow these procedures. In the 2018 Guidance, however, EPA simply interpreted the immediate and necessary consequences of our decision in Mexichem and left rewriting the regulatory framework for future notice and comment rulemaking. Because the 2018 Guidance advised the public of the EPA’s interpretation of legal obligations created by this court, it was an interpretive rule properly issued without notice and comment procedures. I respectfully dissent.” – Source
One more quote this time going into what the EPA did in 2018 and how it did not require comments or follow proper procedures:
In 2015, EPA issued a regulation disallowing the use of HFCs as a substitute for ozone-depleting substances. That rule was challenged in our court in Mexichem Fluor, Inc. v. EPA, 866 F.3d 451 (D.C. Cir. 2017). We determined that EPA could validly forbid current users of ozone-depleting substances from switching to HFCs. But we also concluded that EPA lacked authority to force users who had already switched to HFCs to make a second switch to a different substitute. We thus vacated the rule in part and remanded to the agency.
On remand, even though we had sustained EPA’s bar against use of HFCs with regard to entities who were still using ozone-depleting substances, the agency decided to implement our decision by suspending the rule’s listing of HFCs as unsafe substitutes in its entirety, meaning that even current users of ozone-depleting substances can now shift to HFCs. And EPA did so without going through notice-and-comment procedures.” – Official Court Document Source
Conclusion
So, what does all this mean? In the short term it means that business owners can no longer move their older CFC or HCFC systems over to HFC refrigerants. They will be forced to go with a lower GWP alternative. In the long term though it is quite uncertain. I was expecting a string of rulings in favor of the Environmental Protection Agency and the Trump Administration. I’m not advocating for that… it just the way the wind has been blowing lately.
Who knows though, maybe the winds have changed and we may begin to see a tighter grip on HFCs at a federal level.
Counterfeit Refrigerant is a growing problem throughout the world.
The other day I was notified by one of my contacts that there has been a rash of counterfeit R-421A refrigerant within the United States marketplace. I always try to cover these stories as counterfeit product can end up hurting not only the original manufacturers but also the end-users. 421A is a patented refrigerant made under the brand name of Choice Refrigerants. It is an R-22 alternative that is designed for an easy retrofit/conversion away from R-22.
421A is an HFC blended refrigerant that consists of R-125 (58%) and R-134a (42%). Its pressures are nearly identical to that of R-22 which makes for ease of retrofitting. The temperature glide is quite low due to the blend only containing two relatively similar refrigerants. There is also no oil change required so you can continue using the existing mineral oil within the system. All those benefits aside, R-421A does have a significant Global Warming Potential number of two-thousand six-hundred and thirty-one. So, it is not a perfect refrigerant – there never is one, but it is a very good choice when converting a system away from R-22.
As I had mentioned earlier, R-421 is patented and can only be distributed and supplied by Choice Refrigerants or an approved Choice Refrigerants distributor. Today there is counterfeit 421A product being distributed within the market. I will not get into what company is doing this, but the impact of this counterfeit product was significant enough to get Choice’s attention. This counterfeit product is not only infringing on the existing patent but it is also not the exact same formulation. This slightly different refrigerant can result in poor system performance and could even lead to damage to the system itself. Along with that, since it is counterfeit and slightly modified it is NOT approved by the Environmental Protection Agency’s SNAP program. That means that it is illegal to use or sell the counterfeit product.
R-421A Refrigerant
Legal action is being taken against the companies that are distributing this counterfeit product. In the meantime though you can tell that it is genuine R-421A refrigerant product through a few ways. The first is actually asking for the specific brand name of Choice Refrigerants. This product is patented and cannot be sold under any other brand name. Another way to identify if the product is legitimate is by reviewing the packaging. The package should show the ‘Choice’ brand name as well as their tag line stating, ‘The Easy Choice.’ Lastly, every cylinder made by Choice Refrigerants comes with a QR code printed on it. This code can be scanned by your phone or computer and will take you to a product information page from Choice.
We at RefrigerantHQ are partnered with a certified distributor and if you are interested in purchasing or trying out the product please reach out to me by following this link to our contact page.
The trend of recent years continues folks. Just a few days ago on February 26th Andrew Wheeler, the head of the Environmental Protection Agency, signed a rule on 608 refrigerant management regulations known as ‘Protection of Stratospheric Ozone: Revisions to the Refrigerant Management Program’s Extension to Substitutes.’
This version signed by Wheeler is not the final version, but there is little expected to change. It was sent to the Federal Register for final verification and once verified will be published for all to see. The draft rule can be found in our ‘Sources’ section at the bottom of this article. This announced change is not instantaneous. The leak detection and record keeping rules will change thirty days after the final version is published by the Federal Register.
The initial rule for leak detection on HFCs was announced by the Obama Administration’s EPA back in 2016. In essence, they copied the rules that were already on file for CFC and HCFC refrigerants such as R-12, R-502, and R-22. These new HFC rules applied mostly to commercial applications or businesses such as super markets, plants/factories, large refrigerated warehousing, ice rinks, and any other large scale operations.
With the repeal of this rule businesses across the country are estimated to save around twenty-four million dollars per year. (Source) That is a significant amount but another factor, that is very difficult to measure, is the overall peace of mind of these business owners and managers. They no longer have to worry about compliance or the threat of the EPA breathing down their neck. Let’s take a look at exactly what will change once the Federal Register has published the final rule:
Today, the following rules have to be followed for any appliance that holds fifty or more pounds of HFC refrigerants (Source from Hydrocarbons21.com):
Conduct leak rate calculations when refrigerant is added to an appliance.
Repair an appliance that leaks above a threshold leak rate.
Conduct verification leak tests on repairs.
Conduct periodic leak inspections on appliances that exceed the threshold leak rate.
Report to Environmental Protection Agency on chronically leaking appliances.
Retrofit or retire appliances that are not repaired.
Maintain related records.
Reading the above requirements can really illustrate just how many hoops and regulations that these business owners had to go through to stay compliant. Don’t get me wrong folks, I am not entirely against having these regulations. What I am against though is how they came about. Any of you who have read my posts in the past know exactly how I feel about this. But, for those who aren’t as familiar with what I am talking about let us review.
The EPA and the Obama Administration used the Clean Air Act as their basis for authority when it came to phasing down and the regulation HFC refrigerants. Herein lies the problem though. The Clean Air Act sections that they were referencing strictly refers to Ozone Depleting Substances. These are your CFC and HCFC refrigerants such as R-12, R-22, R-502 that we all saw get phased out over the past thirty years.
Here’s the thing though… HFC refrigerants do not harm the Ozone. Not in the slightest. HFCs do harm the environment though, just in a different way. HFC refrigerants are known as super-pollutants or greenhouse gases. They directly contribute to Global Warming when they are vented or released into the atmosphere. So, they do cause a problem… but they do not cause any problem to the Ozone.
This reasoning is what the current EPA used when repealing the Obama era regulations. They claimed that the EPA overstepped its authority when introducing these HFC laws. I agree with them. While their intention was good back in 2016 it was NOT the right way to go about it. It was an overreach of the government. Just like with everything though, there is an opposing argument. This argument comes from those who are in support of the 2016 leak regulations. Their argument is that the Clean Air Act authorized them to regulation Ozone depleting substances AND their replacements. Those last two words are where the debate comes from.
I am not going to get into who is right here and what side should win. Let us instead just look at the facts. The EPA is entirely biased depending on what administration is in control. It was biased for Obama and now it is again for Trump. So, the real question is will we see all of this change again after this year’s election cycle? Who knows…
Purchase Restrictions?
When the EPA originally announced last year that they would be looking at rescinding the HFC leak regulations there was also talk that they may rescind the Obama era purchase restriction on HFC refrigerants. I am sure everyone remembers when anyone could go out and buy a cylinder of R-134a or R-410A and keep them on hand for those just in case situations. On January 1st, of 2018 the option to purchase HFC refrigerants without being either 608/609 certified with the EPA went away.
No longer could anyone purchase refrigerant cylinders. They could still purchase smaller quantities like cans, but the option to purchase those large cylinders was gone. This was again an example of the EPA moving the original regulations on CFCs and HCFCs over to HFCs. Overall, I think this had a positive effect on the industry itself. Yes, there was less demand but the contractors who were selling refrigerant to their customers could enjoy that extra mark-up without the risk of the customer purchasing their own cylinder.
I am in favor of removing the purchase restriction. It opens the market back up and, to be honest with you, before the restriction I was selling quite a bit individual cylinders on this website. It’d be nice to have that revenue stream open back up again! Regardless of my opinion though, it is looking like the purchase restriction may be rescinded as well. After all, if they removed the leak detection requirements why not remove purchasing as well?
Conclusion
The announcement of this rule change by the EPA is only going to fuel the United States Climate Alliance. The Climate Alliance is a grouping of states across the country that was formed a few years ago when the Trump Administration announced that the US would be pulling out of the Paris Climate Accord. This alliance is dedicated to all forms of climate protection but one that has seen recent activity are regulations on HFC refrigerants.
With the removal of the EPA’s SNAP Rules 20 and 21 the Climate Alliance stepped up to the plate and began announcing their own HFC phase down laws. California, as usual, was the first of these states. It all began a domino effect though and we are seeing more and more states either pass HFC phase down legislation or announce that they are working on their own version. Just a week or so ago it was announced that Maine, Massachusetts and Rhode Island are all working on their own version of regulations. In most cases the phase down laws closely mimic the original EPA’s SNAP Rules 20 and 21 but there are some states, like California, who went for a stricter approach.
One thing is certain, the Federal Government and the States are heading towards very different goals. If we keep seeing these EPA regulations repealed then we will begin to see more and more states announce their own plans and all of these Federal changes won’t mean squat. But hey, at least the states are going about this the right way and not trying to circumvent the law by using the Clean Air Act as a cover.
During the summer of last year I wrote an article on the most recent anti-dumping petitions to be filed on HFC refrigerants. Anti-dumping petitions are nothing new to the refrigerant world. In fact there have been a slew of petitions filed over the past ten years. These range from R-134a, R-410A, R-404A, and other common refrigerants. Last year’s petition focused on the actual blending process on tariffed refrigerants. Most recently, just last month, another petition was filed this time on the HFC R-32.
There are now three major anti-dumping petitions out there. The first is a potential duty being installed on the blending process of common HFC refrigerants such as R-410A and R-404A. The duty would apply if the required refrigerants were imported from China and then blended within the United States. This would prevent the circumvention of already established duties on completed HFC blended refrigerants. A final ruling is expected on this petition by April 7th, 2020. I would highly expect the Trade Commission to rule in favor of anti-dumping duties on this. It is the logical decision based on their previous rulings.
Unfinished Blends
The second petition is similar to the first only it targets ‘unfinished blends’ being imported in from China. The term unfinished blends is rather ambiguous, but it basically means HFC blended refrigerants that are either already fully blended or are partially blended. This can get rather shady. What classifies a blended refrigerant as unfinished or finished?
There was a refrigerant distribution company that was importing blended refrigerant from China but labeling it as ‘unfinished blends.’ (I will not state this company’s name within this article.) It was unclear exactly what this company was doing to the product once it had reached the United States. How did it go from an unfinished blend to a finished blend? Was there a process involved at all, or was this just a clever way of skirting around the previously ruled anti-dumping duties on blended refrigerants?
The other refrigerant distributors out there were importing R-32, R-125, R-134a, R-143a refrigerants into the United States. Once there they would blend the refrigerants themselves to come up with R-410A, R-404A, R-407A, R-407C, etc. While this was still using a loophole from the previous rulings it was not a flat out deceit such as importing unfinished blends was.
The company involved in this petition declined to comment on a questionnaire that was sent to them. Because there was no reply the International Trade Commission announced a preliminary ruling on the case last week. Their ruling stated that:
“The Department of Commerce (Commerce) preliminarily determines that imports of unfinished blends of hydrofluorocarbon (HFC) components R-32 and R-125 from the People’s Republic of China (China) are circumventing the antidumping duty (AD) order on HFC blends from China. As a result, imports of blends of HFC components R-32 and R-125 from China will be subject to suspension of liquidation effective June 18, 2019. We invite interested parties to comment on this preliminary determination.”
“For the reasons described below, we preliminarily determine, pursuant to section 781(a) of the Act, that imports of unfinished blends of HFC components R-32 and R-125 from China are circumventing the Order.”
The final ruling on this case is expected in April as well, but at this time it looks like the International Trade Commission will be ruling against these unfinished HFC blends. Hopefully this is the last of the ‘unfinished HFC blends’ being imported into the United States.
R-32 Petition
Finally, the last and third petition is the most recent one. I touched on this one earlier but this petition was announced just last month and it focuses on the HFC refrigerant R-32. R-32 is a critical component when it comes to some of the most popular HFC refrigerant blends. As an example, R-410A is fifty percent R-32. If this petition is ruled in favor of we can expect to see a significant impact to the cost of refrigerant throughout the US market.
Within the petition it was stated that in the year 2018 there was an estimated twenty-one and a half million dollars worth of R-32 imports brought into the United States. I would say that nearly all of that imported refrigerant is being blended into HFC refrigerants that have duties assigned to them. (There is little stand alone R-32 applications in our market at this time.) This R-32 petition does seem a tad redundant though considering there is already a petition out there on the actual blending process. Who knows though, this latest petition from Arkema could be an insurance policy in case their petitions from last year fall through.
I am not sure how this one will go. If the ITC rules in favor of the blending petition then why would they bother with this one as well? We may see this one tossed out if the blended petition goes through. On the other hand, like I said earlier, if the blended petition falls through then Arkema has a fall black plan. I can only imagine what would happen to the price if both petitions were approved.
The International Trade Commission is expected to make a market injury determination on March 6th, 2020. If injury is found then the ITC can expect to make a preliminary determination on July 2nd, 2020. Lastly, if everything goes how it should a final ruling will be scheduled for October 5th of this year. If the ITC rules in favor of anti-dumping duties on R-32 then they could take effect on November 5th. The expected duty is 87.98 percent.
Conclusion
Ok, so I went through all of that and now my mind is spinning. There is a lot to these petitions and I have read through a number of documents that folks have sent my way. I believe I have a pretty firm grasp on the matters, but if I missed something or misstated something in this article please let me know! I intend for this to be accurate and do not like to have errors within the article. Feel free to contact me via e-mail.
I apologize for two e-mails in just a couple of days but it has been a busy week in refrigerants! Last week on the 23rd the Arkema Corporation filed a new petition with the United States’ International Trade Commission. For those of you who have followed this saga over the past few years you won’t be surprised that this was yet another anti-dumping petition.
This time the petition focuses on the HFC R-32. Arkema is stating that R-32 imported from China is being brought in at an unfair price and is causing the market and prices to crash. This mass import prevents domestic manufacturers, like Arkema, from selling their product… and if they are able to sell it is at very low margins. From what I have ready while doing research on this article it appears that Arkema is the ONLY domestic manufacturer of R-32 within the United States. (They have a plant in Calvert City, Kentucky.) If you know otherwise please let me know.
In this latest petition Arkema asks for a ninety percent anti-dumping levy put against Chinese R-32 imports. That is a hell of an increase, but some of you may be wondering why are they focusing on R-32? Why aren’t they focusing on the more popular HFC refrigerants like 410A? Well folks to understand that we have to travel back in time to 2016. Back then there was a similar case sent to the United States Trade Commission. This case was anti-dumping on R-410A. Arkema and others won this petition and anti-dumping levies were issued against Chinese R-410A .
The problem here though was that these levies were issued only against the fully blended R-410A refrigerants. The levy did NOT apply to the components of these blended refrigerants. What that meant was that you could import Chinese R-32 or R-125 into the United States without any levies or tariffs applied. So, what happened was that we had distributors and importers shipping in these components in mass and then blending them at their facilities within the United States. This got around the anti-dumping levies entirely and kept the market at rock bottom prices.
In 2018 the mistake was realized and the interested parties began to form a new plan. In April of 2019 a new case was filed by the HFC Coalition with the International Trade Commission. This one was slightly different. This time it aimed to add the levies to any imported refrigerants that were then used as components for blended refrigerants. An excerpt from the filing reads as follows (Source):
COMMERCE SHOULD INCLUDE HFC COMPONENTS, “COMPLETED OR ASSEMBLED” IN THE UNITED STATES INTO HFC BLENDS, WITHIN THE SCOPE OF THE ANTIDUMPING ORDER PURSUANT TO SECTION 781(A) OF THE ACT.
So this time folks they got a bit smarter and went after the actual components of refrigerants. The outcome of this case is still pending and a ruling is expected sometime this spring. Meanwhile, this new petition was filed just last week. As we said earlier, this one doesn’t focus on the blending process but instead solely on R-32. R-32 is the key ingredient when it comes to blending R-410A. So, if this does pass then we can all expect a hefty increase when it comes to pricing.
Conclusion
The question is will these new petitions work? If you ask me I say they will. I believe that the initial ruling back in 2016 was an oversight by the courts and by those who filed it. When they ruled for levies on R-410A I am sure that it was meant for the components as well… but that’s not how the law works. There are loopholes.
If they had ruled in the past that Chinese imports were damaging the market why would they not rule that way again on a more specific matter? If these rulings do come through what will be next? Can we expect to see a new petition filed on R-125 as well? And, even if all of these petitions work are businesses and consumers ready to pay those higher costs for the American made product? Time will tell…
Last Friday, the 26th of January, New Jersey Governor Phil Murphy signed into law Senate Bill 3919. This law mimics the Environmental Protection Agency’s SNAP Rules twenty and twenty-one. The New Jersey bill does have not specific dates set yet for each of the proposed phase downs. These will be released at a later time and will have to be modified from the EPA’s original dates.
This now brings the total up to five states who have now signed into law various HFC phase down measures. These include California, Washington, New York, Vermont, and now New Jersey. There are many more to come though folks as all of these states belong to what’s called the Climate Alliance. This Climate Alliance was formed in the summer of 2017 shortly after the Trump Administration pulled the United States out of the Paris Climate Accord.
The states that joined this alliance disagreed with the Trump Administration and announced that they would be taking their own individual state action. Their goal would be to honor the pledges made in the Paris Climate Accord as well as other climate treaties and regulations. As of today there are now twenty-three states in this Climate Alliance. This is important because all of the states that have moved forward on phasing down HFCs were part of this alliance and that the other states within this alliance have announced that they are looking towards HFC phase downs as well. It is just a matter of time before another state announces their HFC phase down plan.
We are beginning to see the domino effect here folks. But why? Why hasn’t the Federal Government or the EPA’s rules gone into effect? Well, to answer that I’ll have to give a bit of a history lesson. The infamous EPA SNAP Rules twenty and twenty-one were introduced in 2015. These rules were the initial HFC phase down regulations. They mainly targeted R-134a and R-404A. 404A wouldn’t be acceptable in new applications as of a certain date and R-134a wouldn’t be acceptable in automobiles as of a certain date.
When these new regulations were introduced it was taken as the law of the land and the industry moved forward. It wasn’t until the summer of 2017 that everything changed. You see there was a lawsuit brought against the EPA and their new SNAP rules. The suit stated that the EPA had overreached its authority when it came to phasing down HFC refrigerants. The EPA had cited authority from the Clean Air Act and the Montreal Protocol Treaty but both of these documents only referred to Ozone damaging substances. There was no mention of Greenhouse Gases or refrigerants with a high Global Warming Potential (GWP).
The EPA had truly stretched their authority here and the federal courts saw it this way too. The EPA’s SNAP rules twenty and twenty-one were overturned and the national HFC phase down was gone in a blink of an eye. Now on one knew what to do or what to expect. The industry had operated for the past two years on the knowledge that HFCs would be phased down shortly and now all of that was gone.
There were multiple appeals on this federal court ruling but they were all rejected. One such appeal went all the way to the Supreme Court but the court refused to hear it… probably because it was so cut and dry that the EPA overreached its authority. The other chance to phase down HFC refrigerants came from what’s known as the Kigali Amendment. This was an amendment to the Montreal Protocol that aimed at phasing down HFC refrigerants on a global scale… just like we did with the Montreal Protocol back in the 1990’s and 2000’s. The problem with the Kigali though is that it has never been sent to the United States Senate to ratify. The Trump administration has sat on it for years and they have shown no intention to send it to the Senate.
But wait folks, there’s more! As I write this article there are now two separate HFC phase down bills in the United States Senate and the United States House. Both of these bills more or less aim to accomplish the same thing: Give the EPA the power to phase down and phase out HFC refrigerants. So far these bills have stalled and do not look to be going anywhere. Even if they do pass both houses and a joint bill is reached chances are Trump will veto it and then we will be back to where we were earlier.
So, we are now left with states’ rights. Politically, I am a big states’ rights guy anyways. This is why we are seeing individual states come out with their own laws. As more time passes additional states will come aboard with their own HFC phase down plan. As more states join manufacturers will be forced to adapt to these states’ new requirements and regulations. What that means is that we will eventually get a national phase down rather we like it or not.
This will be a battle of convenience to the manufacturers out there. Is it easier and cheaper to comply with the strictest regulations and be able to sell in all fifty states? Or, do you stick with the status quo and only be able to sell your product in forty states? How many manufacturers are willing to write off the California and New York market? Not very many I’m guessing. This is why we will see these manufacturers actively start moving away from HFCs even without a federal program.
So, in closing folks… there is no need for a federal or EPA plan. Let’s just keep this going with States’ Rights and eventually over time HFCs will be a thing of the past… rather you like it or not.
A few months ago I had written an article on a newly introduced bill in the United States Senate. This bill known as the, ‘American Innovation and Manufacturing Act,’ aimed at phasing down the usage of HFC refrigerants over the next fifteen years. This same bill was actually introduced back in February of 2018 as well, but it ended up going nowhere. Now, in January of 2020, this bill has thirty-two backers from both parties.
It is still quite a long stretch if this bill gains further traction, but there was a sign of hope this week. A few days ago the United States House introduced their own version of the proposed HFC refrigerant phase down bill. The House bill was introduced into a subcommittee by two Democrats and two Republicans from New York, Texas, and California. The bill itself was very similar to the Senate bill. This House bill will phase down usage of HFC refrigerants by eighty-five percent over a fifteen year period.
Both bills aim to accomplish this by giving the phase down and phase out authority to the Environmental Protection Agency. It would then be up to the EPA to determine which refrigerants are phased down, phased out, and what timeline they would follow. You could think of this as the Montreal Protocol/Clean Air Act part two. It is the same thing that we saw in the 1990’s and 2000’s when the EPA began phasing out CFC and HCFC refrigerants such as R-12, R-502, and most recently R-22.
These bills are not only being backed by both Republicans and Democrats but they are also seeing outside support from such affiliations like the Air Conditioning, Heating, and Refrigeration Institute (AHRI); the Natural Resources Defense Council (NRDC); the US Chamber of Commerce; and the Alliance for Responsible Atmospheric Policy (ARAP). You will also see large refrigerant manufacturers like Chemours or Honeywell backing these bills. There is a lot of lobbying money involved with these bills.
All of these supporting parties claim that by phasing out HFC refrigerants the United States will see a tremendous growth in jobs and our economy. The numbers cited for the Senate bill state that over one-hundred and fifty-thousand jobs would be created and that we would see thirty-nine billion dollars in economic growth from the passing of this bill. On top of all that we would be introducing climate friendly polices.
History
What you read above was the official selling point for these bills. Jobs, growth, and climate. I’m sorry to say though folks, I just don’t buy it. These interested parties have been trying to phase down HFC refrigerants for the past five years and with each passing year they have been met with failure. I’m just glad that they are trying this the legal way now instead of trying to circumvent the system.
This all started back in the summer of 2015. It was then that the EPA introduced a new rule for their SNAP program. This rule, known as rule 20, was the first step at the EPA trying to phase down HFC refrigerants. Here’s the thing though, the EPA cited their authority to phase down HFC refrigerants from the Clean Air Act and the Montreal Protocol. The problem with this is that these laws/treaties were only meant for Ozone depleting substances such as CFC and HCFC refrigerants. These refrigerants contained chlorine and when that chlorine made its way into the Stratosphere it chipped away at the Ozone.
HFC refrigerants such as the ever popular ones like R-134a, R-404A, and R-410A do NOT damage the Ozone. Not in the slightest. These refrigerants do not contain chlorine and therefore cannot harm the Ozone. The problem with these refrigerants is what’s known as their Global Warming Potential (GWP). These refrigerants have a very high GWP number. This in turn means they are super Greenhouse Gases. The higher the GWP number the more impact the refrigerant has on Global Warming.
So, the EPA tried to extend their authority on Ozone depleting substances over to non-Ozone depleting substances. The sad part was that this was taken as the law of the land for a few years. After the new rule was introduced the industry and country just accepted it as the new status quo. It wasn’t until 2017 that a federal court ruled against the EPA citing that they overextended their authority and that they did NOT have the power to phase out HFC refrigerants as well. If they wanted to do this then they needed new legislation that would give them such powers.
This ruling caught everyone by surprise. Everyone had just assumed that the EPA’s overreach would just be accepted. Larger refrigerant manufacturers, who had a vested interest in phasing down HFC refrigerants, appealed the ruling hoping to get a different result in favor of the EPA. But, the results ended up being the same. The EPA’s plans for HFC phase down had been nixed. There was now no set plan within the US to phase down these climate damaging refrigerant gases.
It was a bit later that what’s known as the Kigali Amendment was moving forward. This amendment was an addendum to the now famous Montreal Protocol. The amendment was to phase down HFC refrigerants across the world. It was very similar to the EPA’s proposed HFC phase down plan. The United States, under the Obama Administration, signed the treaty amendment. All that needed to be done was to ratify the amendment in the Senate for it to become law within the United States. However, after Donald Trump came to power the Senate never received the chance to ratify the Kigali Amendment. There has been no indication from the Trump Administration that they will send the amendment to the Senate to ratify. It will instead sit in purgatory.
Conclusion
It was after the failed EPA ruling and the stagnation on the Kigali Amendment that lobbyists began working on creating the bills we now have within the Senate and the House. This seems to be the only chance left to phase down HFC refrigerants across the country. I am still very skeptical of this working though folks. Yes, while the chances have improved now that there are two bills in both Houses there is still on very large obstacle in the way… Donald Trump.
I mean think about it for a moment. If Trump hasn’t backed Kigali and has instead sat on it for years… why in the world would he sign these HFC bills coming from the Houses? It doesn’t make sense. Perhaps their hope here is that by the time the bills have left the lower committees and are ready to began being voted on the Election would have occurred and a new President could be coming to the White House.
Otherwise, if Trump is elected again then there is no chance that this bill misses the veto… and that is if it even clears both Houses. If we want an HFC phase down in the near future within the United States then there are two possible ways. The first is through attrition. Pressure the manufacturers to switch to newer more climate friendly refrigerants. Then, over time, the HFCs will slowly fade away. We are already seeing this with R-134a in automobile applications. Ninety percent of the vehicles made in 2020 are using the climate friendly 1234yf. R-134a is dying slowly.
The other option, which is admittedly more messy, is having states come up with their own individual phase down policies. There are quite a few states that have already done this such as California, New York, and Washington. If enough states get on board then you will have that war of attrition again as manufacturers will be forced to switch to more climate friendly options. The downside here is you get a mish-mash of laws and regulations that vary by state. This can make it very difficult for businesses and manufacturers to operate in multiple states.
All that being said folks, I don’t have much hope in these bills moving forward. Even if they gather the votes they have that almighty veto to contend with. I’ve been wrong before though, so who knows for sure. If nothing happens this year then watch the election and see whom gets elected. If it’s a Democrat then we may yet see HFCs being phased down sometime in 2021.
It is a few days before Thanksgiving and the weather is quite cold outside here in Kansas City. I’m in my office sipping on some coffee and enjoying some time off. As I’m sitting here I have been thinking about refrigerant. Yes, yes, nothing quite says time off like refrigerant. Or, at least it does for me. You see these winter months is when I get quite a bit of time off and everything is a lot less hectic. Everything has slowed down and I have some time to catch my breath, relax, and plan for the next year.
Over the past five years or so we here at RefrigerantHQ have spent some time creating our ‘refrigerant price per pound’ articles. These have been some of most successful posts just because there just isn’t other information out there. If you look elsewhere you either won’t find anything on the price of refrigerants or you will find something that is highly inflated and is way above the marketplace. Now, I will say that more often then not our articles on this website are more technical and geared towards the HVAC or automotive technician but I always make time for these price per pound articles for my end-user readers as well. There is nothing worse then being gouged on the price of a product… and then not even knowing you were gouged in the first place!
In this article we’re going to give you an accurate price per pound on R-134a. But, before we get into that I first want to take some time and go over some air conditioning basics for your vehicle. If you’re not interested in this and you are just looking for the price then please scroll towards the bottom of the article and look for a section titled, ‘Price Per Pound.’ Otherwise, if you are interested then please read on.
Know This Before Purchasing
Let’s say your vehicle’s air conditioner is no longer working. You’ve tried everything you can think of. You even tried a few AC recharge kits and the air only stayed cool for a few days. It is clear that you need a repair… but what should you expect with this repair? Obviously, every dealer or repair shop is going to charge differently for their parts and labor but the below section will at least give you some basic knowledge on what to expect as you take your car into the shop.
R-1234yf VS R-134a
Something that a lot of folks may not have realized is that in recent years the refrigerant that automobiles are using has switched. Yes, that’s right. A lot of newer vehicles are no longer using R-134a. Instead they have switched over to a newer HFO refrigerant known as R-1234yf. In the United States this switch started to occur in 2015 and with each passing year the number of cars that are using 1234yf has increased. In the next few years it is predicted that nearly ninety percent of the market will be using 1234.
Earlier this year I did an article where I put together a list of all cars and what refrigerant they were using for their 2019/2020 model years. This list took quite a bit of time as I had to dig through instruction manuals for all of these different vehicles. I didn’t find every single car but I found the majority. At the end of the exercise I had found that nearly seventy percent of cars produced in 2019 within the United States are using r-1234yf. That is a huge number folks. This article can be found by clicking here.
There is a really big downside when it comes to r-1234yf. That is the price. In most cases r-1234yf is ten times more expensive then r-134a. So, your thirty dollar recharge on r-134a may end up being close to three-hundred dollars on 1234yf. That is quite the difference and can result in a lot of angry consumers when they get their repair bill. The bad news here is that I have seen no sign of the 1234yf pricing dropping anytime soon either.
You Are Paying For Expertise
Ok folks, so the information that I am going to give you in our ‘Price Per Pound’ section is very nearly, if not exactly, the cost that your technician is paying for their R-134a refrigerant. What that means is that you can expect a markup. After all, the technician and the dealership need to make money as well. This is a specialized trade and requires trained expertise in order to succeed in. Thinking that you can do this yourself is never a good idea as there are a lot of intricacies that need to be accounted for. As an example, let’s go through and ask a few simple questions that a technician would either have to do or consider:
Do you know how to flush your system?
Do you know what refrigerants can be vented?
Are you 609 certified with the EPA to handle HFC refrigerants?
Do you know how to find, let alone fix, a refrigerant leak?
All of these questions and more are what you are paying your technician for. Remember that they need to make money too, but there is also a fine line between having profit and gouging. Reading this article, and reviewing the price per pound, will allow you to be educated and give you the power to negotiate the price of refrigerant.
Your AC Unit is a Closed System
Refrigerant Cycle in a Closed System
Even before you bring your car into the dealership to look at the air conditioner you should be aware that air conditioners are what’s known as closed systems. What that means is that the refrigerant in your air conditioner moves back and forth between different cycles and it, in theory, never runs out or needs refrigerant refilled.
If you find that your unit is low on refrigerant or is completely out do NOT just refill your machine with a new refrigerant. I repeat do NOT do this. Your system does not need a top off. It does not need just a little bit more refrigerant to get by. No. If you are running out of refrigerant that means that somewhere in the refrigerant cycle there is a leak. Your unit is leaking refrigerant and will continue to leak refrigerant until a repair is made. If you dump more refrigerant into it without fixing the leak you are literally throwing money down the drain.
I like to think of it as a above ground pool. If you get a puncture in the pool lining water will leak out. Sure you can always add more water but it’s not fixing the problem. Adding more refrigerant doesn’t fix the problem either. It’s just prolong the inevitable and wasting money.
Purchase Restrictions
This isn’t as big of a problem when it comes to automotive application but it is still worth mentioning. You see back in January 1st of 2018 a new regulation was implemented by the Environmental Protection Agency. This regulation known as the, ‘Refrigerant Sales Restriction,’ aimed at preventing novices from purchasing HFC refrigerants such as R-410A, R-404A, and yes… R-134a. These restrictions already existed on HCFC and CFC refrigerants but they were now moved over to HFC refrigerants as well. What this means is that you are no longer legally able to purchase R-134a unless you are 609 certified with the EPA. Now, there are a few slight exceptions to this such as:
The first exception is that if you purchase small cans of refrigerant that are under two pounds of refrigerant or less. This works great for automotive applications as they only need a few pounds to recharge an entire system. But, this can be difficult when trying to recharge a larger system with only a pound of refrigerant at a time. A typical split-system air conditioner may take up to twelve pounds of refrigerant. So, you could technically do this yourself but you would have to find a source for the cans and it still not legal to tamper or tinker on an air conditioning unit if you are certified with the EPA.
The other exception is providing the vendor you are buying from with an intent to resale form. What this means is that you state that you will NOT be using this refrigerant yourself but that you intend to resell it to another party. In this case the legal record keeping requirements would be passed onto you. So, if the supplier you bought from gets audited by the EPA their records will then point to you. The EPA will reach out to you and you better hope you either sold the product or are 609 certified!
If you do not meet the above exceptions and you try to purchase R-134A you will be asked for your 609 license number. If you cannot provide one then you will not be allowed to purchase. This was done to protect the environment. If R-134a is vented or leaked into the atmosphere it contributes to Global Warming. The restriction was put into place to prevent novices from playing around with the refrigerant and accidentally releasing it into the atmosphere. There was talk at the beginning of 2019 that the Trump Administration would rescind these restrictions but so far there has been no follow-through on this matter. As the law is today you are not able to purchase this refrigerant.
The good news here is that this doesn’t affect the automotive market too much. Yes, there was a time where a lot of folks were buying thirty pound cylinders of R-134a to have around. That can no longer be done, but you can still get the cans online at stores like Amazonor at any major automotive retailer.
R-134a Price Per Pound
Alright folks so we’ve gotten past the need-to-know section and now we can begin to dive into to see the exact cost per pound. Let me paint a picture for you now. Let’s imagine it is the middle of summer and your car’s air conditioner has gone out. No cold-air is blowing through and you’re stumped. You drive the car into the dealership for a repair, but what can you expect? The first thing is that you will need to pay for a repair to fix whatever caused the malfunction. This could be a faulty hose, a bad compressor, a bad evaporator, and so on and so on. On top of this you will also have to pay for a full refrigerant recharge. But, what price is fair here?
Before I give you the price on R-134a I first want to give you a few tools that will allow you to determine the true cost of R-134a at any given time. You see, I am writing this article in November of 2019 and I can bet that by the time summer rolls around and you’re reading this article that the prices have changed. Refrigerant pricing is ever changing and you never truly know where it will be at. The good news is that if you check Ebay.com and Amazon.com you can begin to see where the market is at any given time. Yes, it’s really that simple folks.
When looking at these prices on Ebay and Amazon be sure to look at the thirty pound cylinder pricing. That is going to be quite a bit cheaper then the cans and that is most likely what the dealer or repair shop you are at are buying. From my experience these dealerships will buy a pallet full of thirty pound cylinders and use them throughout the season. This gives them a very aggressive cost within the market.
Today, if we look at Ebay we can see that thirty pound cylinders are ranging from one-hundred and thirty to one-hundred and fifty dollars per thirty pound cylinder. For argument’s sake let’s take the highest dollar one at one-hundred and fifty dollars. In order to get the price per pound let’s do some simple math:
$150 / 30lb cylinder = $5.00 per pound.
There you have it folks, $5.00 for one pound of R-134a refrigerant. Now, please keep in mind that these prices CAN change. To give you a bit more help I have also included a feed from our Ebay partner below that shows you the current market price of R-134a:
$109.99 End Date: Tuesday Jun-9-2020 13:25:35 PDT Buy It Now for only: $109.99 Buy It Now | Add to watch list
Now each car is different and the amount of refrigerant that they need can be different as well. Some only require one pound and others upwards of eight to nine pounds. It is always best to check your owner’s manual or your dealership to see how much you need. In our example we’re going to call it three pounds of refrigerant to get a complete fill up of your vehicle.
3 pounds of refrigerant * $5.00 per pound = $15.00 for a complete fill up.
Conclusion
Alright folks, that should about cover it. I’ve gone through everything you should know when refilling your vehicle’s air conditioner as well at what price point to expect. One last thing I wanted to mention before closing this article is that you have to remember that there will be mark-up involved from your technician or HVAC company. The price that I gave you is going to be very close to their cost. So, while you may not get that $5.00 price per pound article it does give you a starting point for negotiations. Remember, that everything in this world is negotiable and if they quote you fifteen dollars a pound then you do your best to get them down to seven dollars a pound using this article as a point of reference.
Thanks for reading and I hope this article was helpful,
Greetings ladies and gentlemen and welcome to RefrigerantHQ! It’s just a few days before Thanksgiving. The weather is quite cold outside and I am sitting in my office, sipping at a cup of coffee, and thinking about refrigerant. Yes, it seems that refrigerant is always on my mind, even during these colder winter months. In fact it is actually quite a bit easier to get work done during this time of year. With summer gone and spring quite a ways in the future everything slows down a bit and I have time to catch a breather, gather my thoughts, and write some articles.
Most of the time the articles on this site are more of a technical nature and cater towards HVAC technicians and contractors. However, today we will be doing something slightly different. You see over the past four years we here at RefrigerantHQ have published a series of articles that go into the exact cost that business owners can expect when paying for refrigerant. This was a problem that I recognized a while back. When a business owner receives a quote on refrigerant they have no idea if it’s a fair price or if they are being gouged. There were very little references out there so it made it nearly impossible to negotiate or price shop.
In this article we are going to give you the exact cost per pound on R-404A refrigerant. This will give you the knowledge on rather or not you are being priced fairly. It could be that you own a gas station that needs a refrigerator or freezer repaired. Or, perhaps you drive a refrigerated truck and need an accurate quote on 404A for a repair. Or, you are a store manager at the local grocery store and you’ve had and entire row of freezers stop working. Whatever your line of work or the situation is you will need an accurate quote on R-404A and to make sure it is at an accurate price and to have the problem resolved as soon as possible. Each hour or day that goes by is lost business.
Now, before I get into the price details I am going to spend some time covering some basic HVAC and refrigerant knowledge. I can be a bit long-winded at times so if you find that you just want to find the price per pound then I suggest scrolling through towards the bottom of this article and look for the section titled, ‘Price Per Pound.’ However, if you’d like to learn a bit then please continue reading.
Know This Before Purchasing
Before we get into the price per pound when it comes to R-404A refrigerant I like to take some time in this section and inform you of a few basic things about your 404A system. Now I’ve written similar articles for homeowners as well on 410A and R-22. In those articles I always tell the homeowner to check their machine and determine exactly what kind of refrigerant i handles. While it is not as important as a business owner to know the exact refrigerant you are using it is still a good to know. Checking the system to see what kind of refrigerant it uses is a relatively easy task and can be done by locating a white sticker on the outside of the unit. These stickers are typically found in the back room or ‘control room’ of the system. If you are unable to find this sticker it’s not the end of the world, just be sure ask the technician that you call out to service the unit what kind of refrigerant your system is using.
Purchase Restrictions
If you thought that you could repair and recharge your system yourself then you are mistaken. You see, there was a time when this was possible. I knew quite a few small business owners who bought their own cans or cylinders of R-404A. They then repaired and recharged their system. You could find these 404A cylinders online on Amazon and in a lot of big box stores like Home Depot or Lowes.
The problem with this now is that as of January 1st, 2018 you can no longer purchase R-404A unless you are section 608 certified with the Environmental Protection Agency. Purchasing has been locked down to only certified technicians. This new rule is known as the ‘Refrigerant Sales Restriction.’ These restrictions already existed on HCFC and CFC refrigerants but they were now moved over to HFC refrigerants as well. This included R-404A. What this means is that you are no longer legally able to purchase R-404A unless you are 608 certified with the EPA. Now, there are a few slight exceptions to this such as:
Providing the vendor you are buying from with an intent to resale form. What this means is that you state that you will NOT be using this refrigerant yourself but that you intend to resell it to another party. In this case the legal record keeping requirements would be passed onto you. So, if the supplier you bought from gets audited by the EPA their records will then point to you. The EPA will reach out to you and you better hope you either sold the product or are 608 certified!
The other exception is that if you purchase small cans of refrigerant that are under two pounds of refrigerant or less. This works great for automotive and other smaller applications but can be difficult when trying to recharge a larger system with only a few pounds of refrigerant at a time. You could technically do this yourself but you would have to find a source for the cans and it still not legal to tamper or tinker on an air conditioning unit if you are certified with the EPA.
If you do not meet the above exceptions and you try to purchase R-404A you will be asked for your 608 license number. If you cannot provide one then you will not be allowed to purchase. This was done to protect the environment. If R-404A is vented or leaked into the atmosphere it contributes to Global Warming. The restriction was put into place to prevent novices from playing around with the refrigerant and accidentally releasing it into the atmosphere. There was talk at the beginning of 2019 that the Trump Administration would rescind these restrictions but so far there has been no follow-through on this matter. As the law is today you are not able to purchase this refrigerant.
You Are Paying For Expertise
Ok folks, so the information that I am going to give you in our ‘Price Per Pound’ section is very nearly, if not exactly, the cost that your contractor is paying for their R-22 refrigerant. What that means is that you can expect a markup. After all, the technician and the HVAC contractor need to make money as well. This is a specialized trade and requires trained expertise in order to succeed in. Thinking that you can do this yourself is never a good idea as there are a lot of intricacies that need to be accounted for. As an example, let’s go through and ask a few simple questions that a technician would either have to do or consider:
Are you 608 certified with the EPA to handle HCFC refrigerants?
Do you know how to find, let alone fix, a refrigerant leak?
All of these questions and more are what you are paying your contractor for. Remember that they need to make money too, but there is also a fine line between having profit and gouging. Reading this article, and reviewing the price per pound, will allow you to be educated and give you the power to negotiate the price of refrigerant.
Your AC Unit is a Closed System
Refrigerant Cycle in a Closed System
Even before you have a contractor come to your home and look at your air conditioner you should be aware that air conditioners are what’s known as closed systems. What that means is that the refrigerant in your air conditioner moves back and forth between different cycles and it, in theory, never runs out or needs refrigerant refilled.
If you find that your unit is low on refrigerant or is completely out do NOT just refill your machine with a new refrigerant. I repeat do NOT do this. Your system does not need a top off. It does not need just a little bit more refrigerant to get by. No. If you are running out of refrigerant that means that somewhere in the refrigerant cycle there is a leak. Your unit is leaking refrigerant and will continue to leak refrigerant until a repair is made. If you dump more refrigerant into it without fixing the leak you are literally throwing money down the drain. Potentially a lot of money too if yours is an R-22 unit.
I like to think of it as a above ground pool. If you get a puncture in the pool lining water will leak out. Sure you can always add more water but it’s not fixing the problem. Adding more refrigerant doesn’t fix the problem either. It’s just prolong the inevitable and wasting money.
R-404A Price Per Pound
Ok ladies and gentlemen you’ve made it through the boring section of the article. Now we can focus on the real reason you came here. How much exactly is 404A refrigerant per pound? So, let’s envision a scenario. A few of your refrigerators at your gas station are no longer working. You call a service technician to come out and diagnose them. He finds that the compressor has failed and that there is cracking in some of the pipes as well. That means you need a new compressor, new pipes, and most likely a full recharge of 404A refrigerant as well. This is going to be an expensive repair bill.
Before I tell you the exact cost per pound on 404A I want to make you aware that the price will change. I am writing this article in late November and I guarantee that when you are reading this the price will have changed since then. Do not fret though, there is good news. There are a few tools out there that will allow you to find the price of 404A real time. It is relatively easy as well. All you have to do is visit Ebay.com or Amazon.com and check the going rate for 404A. By checking these sites you get an up-to-date price and know right around where you should be paying. I will say that Ebay is the most reliable out of the two. Amazon’s listings of 404A are rather spotty but Ebay always has them on there.
Looking at Ebay today we can see an average price range is one-hundred and ten to one-hundred and fifty dollars for a twenty-four pound cylinder of 404A. I more of a fan of aiming too high rather then too low so let’s take that one-hundred and fifty dollar maximum as our price. Now it is time to do some math:
$150 / 24lb cylinder = $6.25 per pound.
There you have it folks, $6.25 for one pound of R-404A refrigerant. Now, please keep in mind that as I said above these prices can change at any given time. To give you a bit more help I have also included a feed from our Ebay partner below that shows you the current market price of R-404A:
Alright folks, that should about cover it. We’ve covered some need to know topics and also the exact price per pound on R-404A. One last thing I wanted to mention before closing this article is that you have to remember that there will be mark-up involved from your technician or HVAC company. The price that I gave you is going to be very close to their cost. So, while you may not get that $6.25 price per pound article it does give you a starting point for negotiations. Remember, that everything in this world is negotiable and if they quote you twenty-five dollars a pound then you do your best to get them down to ten dollars a pound using this article as a point of reference.
Thanks for reading and I hope this article was helpful,
Greetings ladies and gentlemen! It’s just a few days before Thanksgiving. The weather is quite cold outside and I am sitting in my office, sipping at a cup of coffee, and thinking about refrigerant. Yes, it seems that refrigerant is always on my mind, even during these colder winter months. In fact it is actually quite a bit easier to get work done during this time of year. With summer gone and spring quite a ways in the future everything slows down a bit and I have time to catch a breather, gather my thoughts, and write some articles.
Most of the time the articles on this site are more of a technical nature and cater towards HVAC technicians and contractors. However, today we will be doing something slightly different. You see over the past four years we here at RefrigerantHQ have published a series of articles that go into the exact cost that homeowners can expect when paying for refrigerant. This was a problem that I recognized a while back. When a homeowner receives a quote on refrigerant they have no idea if it’s a fair price or if they are being gouged. There were very little references out there so it made it nearly impossible to negotiate or price shop.
In this article we are going to give you the exact cost per pound on R-410A refrigerant. This will give you the knowledge on rather or not you are being priced fairly. Now, before I get into the price details I am going to spend some time covering some basic HVAC and refrigerant knowledge. I can be a bit long-winded at times so if you find that you just want to find the price per pound then I suggest scrolling through towards the bottom of this article and look for the section titled, ‘Price Per Pound.’ However, if you’d like to learn a bit then please continue reading.
Know This Before Purchasing
Now before I get into the price per pound information you should first understand the R-410A market and your R-410A air conditioner a bit more. The first point of note is do you have an R-410A system? The only way you can be exactly sure is by looking at the outside section of your air conditioner. There should be a white sticker located somewhere on the machine. This sticker will indicate exactly what kind of refrigerant your split-system is taking. If you are in the United States then the chances are that it will be one of two refrigerants. If the unit was manufactured and installed before 2010 then the chances are high that it takes R-22. However, if the system was manufactured after 2010 then it most likely takes the HFC R-410A. Again, it is always best to check for the sticker to identify exactly what kind of refrigerant you are dealing with.
Purchase Restrictions
If you thought that you could repair and recharge your system yourself then you are mistaken. You see, there was a time when this was possible. I knew quite a few folks who bought their own cans or cylinders of R-410A. They then repair and recharged their system. You could find these 410A cylinders online on Amazonand in a lot of big box stores like Home Depot or Lowes. The problem with this now is that as of January 1st, 2018 you can no longer purchase R-410A unless you are section 608 certified with the Environmental Protection Agency. Purchasing has been locked down to only certified technicians. This new rule is known as the ‘Refrigerant Sales Restriction.’ These restrictions already existed on HCFC and CFC refrigerants but they were now moved over to HFC refrigerants as well. This included R-410A. What this means is that you are no longer legally able to purchase R-410A unless you are 608 certified with the EPA. Now, there are a few slight exceptions to this such as:
Providing the vendor you are buying from with an intent to resale form. What this means is that you state that you will NOT be using this refrigerant yourself but that you intend to resell it to another party. In this case the legal record keeping requirements would be passed onto you. So, if the supplier you bought from gets audited by the EPA their records will then point to you. The EPA will reach out to you and you better hope you either sold the product or are 608 certified!
The other exception is that if you purchase small cans of refrigerant that are under two pounds of refrigerant or less. This works great for automotive applications but can be difficult when trying to recharge your system with only a few pounds of refrigerant at a time. A typical split-system air conditioner may take up to twelve pounds of refrigerant. So, you could technically do this yourself but you would have to find a source for the cans and it still not legal to tamper or tinker on an air conditioning unit if you are certified with the EPA.
If you do not meet the above exceptions and you try to purchase R-410A you will be asked for your 608 license number. If you cannot provide one then you will not be allowed to purchase. This was done to protect the environment. If R-410A is vented or leaked into the atmosphere it contributes to Global Warming. The restriction was put into place to prevent novices from playing around with the refrigerant and accidentally releasing it into the atmosphere. There was talk at the beginning of 2019 that the Trump Administration would rescind these restrictions but so far there has been no follow-through on this matter. As the law is today you are not able to purchase this refrigerant.
You Are Paying For Expertise
Ok folks, so the information that I am going to give you in our ‘Price Per Pound’ section is very nearly, if not exactly, the cost that your contractor is paying for their R-22 refrigerant. What that means is that you can expect a markup. After all, the technician and the HVAC contractor need to make money as well. This is a specialized trade and requires trained expertise in order to succeed in. Thinking that you can do this yourself is never a good idea as there are a lot of intricacies that need to be accounted for. As an example, let’s go through and ask a few simple questions that a technician would either have to do or consider:
Are you 608 certified with the EPA to handle HCFC refrigerants?
Do you know how to find, let alone fix, a refrigerant leak?
All of these questions and more are what you are paying your contractor for. Remember that they need to make money too, but there is also a fine line between having profit and gouging. Reading this article, and reviewing the price per pound, will allow you to be educated and give you the power to negotiate the price of refrigerant.
Your AC Unit is a Closed System
Refrigerant Cycle in a Closed System
Even before you have a contractor come to your home and look at your air conditioner you should be aware that air conditioners are what’s known as closed systems. What that means is that the refrigerant in your air conditioner moves back and forth between different cycles and it, in theory, never runs out or needs refrigerant refilled.
If you find that your unit is low on refrigerant or is completely out do NOT just refill your machine with a new refrigerant. I repeat do NOT do this. Your system does not need a top off. It does not need just a little bit more refrigerant to get by. No. If you are running out of refrigerant that means that somewhere in the refrigerant cycle there is a leak. Your unit is leaking refrigerant and will continue to leak refrigerant until a repair is made. If you dump more refrigerant into it without fixing the leak you are literally throwing money down the drain. Potentially a lot of money too if yours is an R-22 unit.
I like to think of it as a above ground pool. If you get a puncture in the pool lining water will leak out. Sure you can always add more water but it’s not fixing the problem. Adding more refrigerant doesn’t fix the problem either. It’s just prolong the inevitable and wasting money.
R-410A Price Per Pound
Alright folks so we’ve gotten through the precursor of this article. Now we can begin to look at the meat and potatoes. This is the reason you came to this article. Let’s say that for whatever reason your air conditioner is no longer working and your house is getting warmer. You call out a technician for a repair quote. Now in most cases when something goes wrong with your air conditioner the refrigerant will most likely leak out. Say for example one of the lines get a crack in the pipe. The refrigerant is going to leak through that pipe so not only do you have to replace the copper tubing but you also have to recharge your system with refrigerant. This is where it can get expensive. Just how much should you be paying for R-410A per pound?
The answer to this question is actually fairly simple. I will give you the exact cost per pound in just a but, but I also want to provide you with a few tools so that you can begin checking the prices yourself. I’m writing this article towards the end of November. There is no doubt in my mind that the market will change by the time you’re reading this in spring or summer. But, by using these tools you can still get a gauge for the market and an idea of how much you should be paying.
It is actually really simple too. All you have to do is visit sites like Ebay.com or Amazon.com and check the price of R-410A. Amazon may not always have a 410A listing but I can guarantee you that Ebay does. Let’s take a look at Ebay’s prices today. As of November 25th, 2019 I am seeing a price range of one-hundred and nine dollars to one-hundred and forty dollars on a twenty-five pound cylinder of 410A. To determine the price per pound let’s take a middle of the road number between those two prices. Let’s use one-hundred and twenty dollars. Now it’s time for some math:
$120 / 25lb cylinder = $4.80 per pound.
There you have it folks, $4.80 for one pound of R-410A refrigerant. Now, please keep in mind that as I said above these prices can change at any given time. To give you a bit more help I have also included a feed from our Ebay partner below that shows you the current market price of R-410A.
$139.00 End Date: Saturday Jun-13-2020 7:43:54 PDT Buy It Now for only: $139.00 Buy It Now | Add to watch list
Ok, so now that we have the cost per pound of R-410A now let’s determine how many pounds that you need to recharge your air conditioner. Now the typical rule of thumb is between two to four pounds of refrigerant per ton of your air conditioner. (You should always check the exact specifications of your machine, but most of the time the two to four pound guideline will be sufficient.) Most home air conditioners are between one ton and five tons. (Anything over five tons is considered a commercial grade unit.) So, let’s get on with our math problem. Let’s pretend that you have a middle of the road three ton air conditioning unit that is on the fritz with no refrigerant in it. In order to refill your unit entirely you will need the following:
4 pounds of refrigerant * 3 ton unit = 12 pounds of refrigerant needed.
12 pounds of refrigerant times the $4.80 per pound number we came up with earlier = $57.60 for a completely fill up of your unit.
Conclusion
Alright folks, that should about cover it. I’ve gone through everything you should know when refilling your air conditioner as well at what price point to expect. One last thing I wanted to mention before closing this article is that you have to remember that there will be mark-up involved from your technician or HVAC company. The price that I gave you is going to be very close to their cost. So, while you may not get that $4.80 price per pound article it does give you a starting point for negotiations. Remember, that everything in this world is negotiable and if they quote you twenty-five dollars a pound then you do your best to get them down to ten dollars a pound using this article as a point of reference.
Thanks for reading and I hope this article was helpful,
One of my most visited articles this year was on the topic of the Environmental Protection Agency’s proposed phase down and eventual phase out of the HFC R-134a. This article is a few years old now and it was referencing the EPA’s SNAP Rule 20 and 21. These rules, which were issued in 2015, stated that R-134a would no longer be acceptable for use in new 2021 model year vehicles.
When I wrote that article everyone was under the impression that this phase out would come to fruition and auto-makers would be forced to switch away from R-134a just as they had done in the 90’s with R-12. There was very little debate on it, it was just the next logical step. However, the winds of politics changed a few years after the EPA announced their new regulations.
In the summer of 2017 a federal court overturned the EPA’s regulations stating that they had overstepped their authority. The argument was that the EPA was using authority granted to them by the Clean Air Act and the Montreal Protocol. Both of these refer to Ozone damage done by products that contain chlorine. Since HFCs contain no chlorine and do not harm the Ozone the EPA does not have authority to phase them out. HFCs do harm the environment, just not in the specific way that these documents lay out. It may have been a loophole, but the law is the law.
This was a surprise to a lot of folks and it caught many companies off guard. I know that courts are supposed to be impartial when it comes to politics but I find it an odd coincidence that a short while after Trump is elected we see this significant overturn in government policy. The court’s ruling voided the EPA’s SNAP Rule 20 and 21 regulations including the one on R-134a. So, as of 2017 there is NOT a scheduled phase out date for R-134a. When I initially heard about this ruling I had assumed automakers would take the easy route and continue the status quo with R-134a.
I was wrong. Over the years more and more makes and models are switching their new vehicles away from R-134a and over to the HFO 1234yf. Earlier this year I wrote an article that attempted to gather a listing of ALL manufactured cars and what refrigerant they are using for their 2020 models. This article took quite a bit of time as I had to dig through instruction manuals for each of these vehicles in an effort to determine the refrigerant they used. The article can be found by clicking here.
The results were rather astounding. If you look at the top fifty selling cars within the United States there are only fifteen using R-134a. That is a seventy percent market share and those numbers are growing with each passing year. Over the next few years there is a prediction that up to ninety percent of cars will be using 1234yf. There are a few reasons for this but in my opinion one of the biggest is that the European Union and other countries have already begun phasing out R-134a. The EU is using R-1234yf and R-744 in their newer vehicles. Perhaps, in an effort of engineering simplification these auto-makers have decided to bite the bullet and switch to 1234yf.
The other major reason for this is pressure from state and environmental groups. While the Federal Government doesn’t have a phase out plan for R-134a there are many states that do. These states makeup what’s known as the Climate Alliance. While not all of these states have announced an HFC phase out plan a good portion of them have. Some of the largest are California, New York, and Washington State. These states can have enormous sway with auto-makers. Just imagine if Ford could no longer sell their trucks in California or New York. That would be a huge impact. Why not make ALL of their vehicles compatible and just use 1234yf?
Conclusion
So, instead of the phase out that occurred with R-12 we have seen a phase out occur due to attrition. Over time the amount of cars using R-134a is going to shrink and shrink. Yes, it may take another ten years or so to get most of the R-134a vehicles off the streets but, in essence, the phase out has already begun. With all of the twists and turns the R-134a phase out has had it is somewhat ironic that we may hit the ninety percent 1234yf usage by the year 2021. While we may have not met the EPA’s goal entirely we are going to be darn close.
Before I close this article I did want to bring up one additional point. This is a question that I’ve had in the back of my mind when it comes to 1234yf. You see, I work in the heavy duty trucking industry. Think over-the-road trucks, dump trucks, water trucks, etc. Through all of this talk on phasing out R-134a for automotive vehicles I have seen very little, or in some cases nothing, when it comes to R-134a usage in truck classes six, seven, and eight.
I have seen the amount of R-134a a single truck dealership can go through in a year. The numbers can be staggering. The question I have is when will these truck OEMs begin to seriously look at 1234yf? Has Kenworth or Freightliner already begun looking? The only news stories I could find on it are three or more years old and reference the original EPA rule as gospel. If we’re going to phase out R-134a in automotive we have to phase it out in heavy-duty as well.
I wonder, when will these OEM behemoths make the move?
Last week the United States Senate announced a bi-partisan bill that would give the Environmental Protection Agency the power to phase out HFC refrigerants over a fifteen year period. This bill is in response to the Trump Administration’s inaction on the Kigali Amendment. Back in 2016 the Obama Administration pledged their support of the Montreal Protocol amendment but when it came time for ratification the Trump Team sat on it and has not passed it to the Senate for review.
Over the past few years of there was a double blow to phasing out HFC refrigerants across the Untied States. Not only did Trump refuse to ratify the Kigali Amendment but we also saw the overturning of the EPA’s HFC phase down regulations. The EPA had planned a scheduled phase down and eventual phase out of popular HFC refrigerants such as R-404A and R-134a. This plan was announced back in 2015 but it was challenged in the courts by the MexiChem corporation.
The premise was that the EPA was using the Clean Air Act and the Montreal Protocol for their authority. The Clean Air Act was designed to phase out CFC and HCFC refrigerants due to the Chlorine that they contained. There was not a mention of HFC refrigerants in the law, only Chlorine Ozone damaging substances. The EPA’s SNAP Rule 20 was overturned by the courts and the proposed HFC phase down laws were erased.
The bill introduced last week is known as the American Innovation and Manufacturing Act. It was introduced by Democrat Senator Tom Carper of Delaware and Republican Senator John Kennedy of Louisiana. Fourteen other senators announced their support for the bill as well.
The bill itself aims at phasing down and eventually out HFC refrigerants over a fifteen period. The bill was written with the consultation of various industry experts so that a fair timeline could be established for businesses for the phase down.
Déjà Vu
I feel like this new bill is déjà vu. We’ve seen this before. In fact, back in February of 2018 a bill was introduced by the same two Senators with the exact same name. (Source) They even referenced the same job report and economic numbers as they did previously. With this new bill Senators are promising an addition of one-hundred and fifty-thousand jobs and thirty-nine billion dollars of growth for our economy.
I just don’t see it folks. First of all, this bill isn’t going anywhere. It’s going to die in the Senate. Even if it did get to the House and by some miracle they passed it then Trump would veto it and we would be back where we started. Secondly, I am very skeptical of those job numbers economic growth.
What are these jobs? Manufacturing and plant workers? HVAC installations and retrofits? Is there going to be that much more demand for these new refrigerants? If so, what is happening to the existing systems? Is this new economic growth number the result of business owners and home owners being forced to upgrade or retrofit their systems? If this is the case then I wouldn’t call a government mandated purchase ‘economic growth.’ Instead, it is forcing business owners into compliance and causing a burden, especially on small business owners. This ‘growth’ has to come from somewhere.
Don’t get me wrong folks, I am not entirely against phasing out HFC refrigerants… but I’m not a fan of the way they are selling this to the legislators and to the people. They already tried this once with the EPA through a loophole, they got caught, and now they are trying to push a bill through with false/hopeful promises. It’s left a bad taste in my mouth.
Getting back to the topic on hand though, I do not see this bill going anywhere. The only chance that there is to pass a full scale HFC phase down law is to wait until after the 2020 election and see what the new incoming Congress and President are like. If things stay the same then there will not be a Federal HFC phase down for quite a while within the United States.
Instead, we will be left with a spattering of States adopting their own HFC phase downs with each one being just a little bit different. If this trend continues I might have to get into consulting…
For more information on the bill check out our ‘Sources’ section below.
Over the past few years the biggest concern when it came to refrigerants has been their Global Warming Potential. The higher the number the more damage that refrigerant could do to the environment. The Ozone problem has been fixed, more or less, due to the Montreal Protocol. In fact, just this month scientists announced that the Ozone hole is at the smallest it has ever been recorded. The problem today though is Global Warming or Climate Change. It seems that ALL of the popular HFC refrigerants used today have a GWP problem. Alternatives needed to be developed.
As we all know, there is no perfect refrigerant. There are always sacrifices that have to be made when selecting a refrigerant rather this be safety, environment, performance, or cost. Because of all of the press and news coverage that Climate Change has been receiving the world has been focused on reducing all of these refrigerants’ environmental impact. The smaller the GWP number the more friendly the refrigerant is to the environment.
The problem here is that the alternatives on the marketplace today that have a lower GWP number also come with a higher flammability rating. The HFCs that we all know and love today are mostly all rated as a ‘1’ on ASHRAE’s flammability scale. These refrigerants show no sign of flame propagation when tested in air at 21° Celsius (69.8° Fahrenheit) and 101 KPA. (14.6488 pounds of force per square inch.) These refrigerants are also non-toxic and are rated as an A1 on ASHRAE’s scale. They are very safe to technicians and to end-users.
The alternative refrigerants that are now being used in place of R-410A, R-404A, R-134a, and other HFCs are NOT rated as a ‘Class 1’ on the flammability scale. Depending on the refrigerant you will most likely see them rated as a ‘Class 2’ or a ‘Class 2L.’ These refrigerants are slightly flammable, or have a lower flammability rating. In some cases HFC alternatives, like Hydrocarbons, are rated as a ‘Class 3’ on the flammability rating scale. These refrigerants are in the higher flammability risk zone, some examples of them are R-290 Propane and R-600a Isobutane.
While some of these replacement refrigerants have been around for decades, others are being developed in laboratories as we speak. Honeywell and Chemours both have their own newer product lines known as Solstice and Opteon. These lines mainly focus on HFO refrigerants but also have some HFC releases as well. In both instances though these new refrigerants are classified as lower flammability. Some examples of these are the ever-popular automotive application known as R-1234yf and then Honeywell’s R-452B (Solstice L41y.)
In the past the United States has been hesitant to use refrigerants with flammability risk. Safety was the priority for us. If the choice was between environmental harm or worker/end-user safety we seemed to choose safety most of the time. This isn’t as true for the rest of the world. Countries in eastern Asia have been working with hydrocarbons and other flammable refrigerants for decades without any major issues. But, there is a lot more training and precautions that have to be taken in order to work on a propane system correctly.
The question that I have in my head, and what caused me to write this article today, is that is the United States ready to adopt these flammable refrigerants? I’m not just talking about in vending machines or super market coolers folks. No, are we ready to accept flammable refrigerants in a traditional home or office split system? R-32 is looking to do just that. Over in Europe and Asia it has become one of the leading refrigerant for split system applications and is widely seen as the replacement for R-410A. R-32 is rated as 2L, so it is only slightly flammable, but the risk is still there.
Looking at the Environmental Protection Agency’s SNAP approved refrigerants list I do see R-32 on there as an approved refrigerant for home and office air conditioning. The catch is that it has to be “for use in self-contained room air conditioning; see rule for detailed conditions.” (Source). So, the applications are still limited for now, but that may change in the near future. Mini-split R-32s have become quite popular as well. I believe it’s only a matter of time before we start seeing R-32 in split systems.
I am curious, what my readers think of this. Do any of you see problems with flammable refrigerants? What are your thoughts on the refrigerant pendulum swinging away from safety and over to environmental? Will you feel comfortable working on systems with these types of refrigerants? I’m anxious to hear your thoughts on the matter as all I see on the topic are others who have written articles. Please feel free to e-mail me your thoughts!
This may be seen as a tired subject by now but over the past few months additional counties have come forward and ratified the Kigali Amendment. So far this month New Zealand and Mauritius have both ratified the document. The month before in September we saw Vietnam and Bhutan commit to the amendment.
For those of you who do not know, the Kigali Amendment is an addendum to the original Montreal Protocol that we all know so well. While the goal of the Montreal Protocol was to phase out Ozone damaging substances such as CFC and HCFCs the Kigali Amendment focuses instead on HFC refrigerants. This would include your R-404A, R-410A, R-134a, and others. Instead of the focus being on Ozone depletion we now look at Global Warming Potential.
There are a lot of nuances that come with this new amendment that I won’t get into here, but the end goal is to reduce HFC refrigerant usage significantly across the world. The thinking is that we have already done it once with CFC/HCFC refrigerants why not do it again with HFCs?
Each month that passes we have seen a steady stream of countries ratifying the amendment. As I write this article there are over eighty countries that have agreed to it. You can see the complete list of countries who have ratified the document by clicking here.
Notice anything after reviewing that list? Some of the biggest and most powerful countries in the world have not ratified the document. Some of these are India, Russia, China, and the United States. These countries are some of your biggest polluters in the world. (Mainly China and India.)
It is not a surprise that these other countries have not moved forward with the amendment. The real surprise is that the United States has not moved forward. Now, before I get further into this, I want to make a point that I do not get into politics on this website. It’s in poor taste and can alienate readers. That being said, prior to the 2016 election the United States was heading towards adoption of this amendment.
The Obama Administration was in Kigali, Rwanda at the time of the signing and had pledged to move forward with the amendment. However, since Trump was elected the status of the amendment has stalled. From what I understand, all that needs to be done is for the State Department to send the amendment to the Senate where the Senate will then ratify. But, Trump’s State Department has sat on the treaty and has no intention of sending it to the Senate. Even if the Trump Administration sent the amendment to the Senate there is still little hope of it being ratified by a Republican controlled majority.
The amendment itself was effective on January 1st, 2019 and now as we approach the end of 2019 I do not foresee this amendment showing up at the Federal level in the near future. It is just not on the top of anyone’s list. If the world wants to see the Kigali Amendment adopted by the United States then they will have to wait until the 2020 election and see how the American people vote.
If an alternative voice to Trump is elected then chances are the Kigali Amendment will move forward. But, if Trump is re-elected then the United States will be one of the few countries that haven’t signed the treaty.
At the time of the signing of the Kigali Amendment back in 2016 the United States had restrictive rules already on the books for HFC refrigerants. These rules were issued by the Environmental Protection Agency using their authority given to them by the Clean Air Act. However, shortly after Trump was elected a Federal Judge overturned these EPA rules stating that the EPA had overstepped it’s authority. The HFC rules were now null and void.
At the time of the signing the Kigali Amendment was seen as a similar step to the already existing EPA rules. There wasn’t much that would change between Kigali and the EPA’s rules. It was a logical next move. But in today’s world with the Kigali in limbo and the EPA’s rules overturned there is very little hope for a Federal plan on phasing down HFC refrigerants.
Without a change at the White House the only way to move forward now is through individual state mandates. Some states have already taken the imitative and proposed and passed their own HFC phase down rules. California was the first and New York wasn’t too far behind. There are now around a dozen states that either have passed HFC phase down laws or are currently working through their own documents within their state houses.
The downside here is that we get a mish mash of rules and regulations that vary from state to state. This can make it very difficult for manufacturers and even contractors/technicians from servicing multiple states. The other side of this who knows how long these state HFC phase downs will last. There was a story in the news a few weeks ago on how the Environmental Protection Agency had voided California’s automotive mileage per gallon rules.
California has their own version of the EPA known as the California Air Resource Board (CARB). CARB had created their own rules when it comes to automotive mileage per gallon. Recently though Trump’s EPA announced that those rules were voided and that the EPA had precedent over California’s CARB. This was a hostile move seen by California but frankly, there’s not much they can do about it. They may challenge it in court and we may see a ruling down the road, but my money is on the Federal Government winning. The Federal Government has even threatened to withhold Federal highway dollars to California if they do not comply with EPA authority. California is definitely in a tight spot here and it will interesting to watch this fight in the future.
All of this leads me to question all of these states that are passing individual HFC phase down laws. Do they have authority to do this? Will the EPA come after them for overstepping their bounds? Will we see ALL of these regulations tossed out? Will the United States ever phase out HFC refrigerants, or will we be using them the same way we are now in ten or twenty years from now? Time will only tell.
7-Eleven, the world’s largest convenience store with sixty-eight thousand stores, has announced a partnership with Honeywell and their Solstice refrigerant line. Specifically, 7-Eleven has announced that they will be switching their condensers away from R-404A and over to the Solstice N40 refrigerant in the United States and Canadian markets. That is nearly twelve-thousand stores. This was the next logical step for 7-Eleven as last year they began a similar transition in their Japanese market. This switch was mandated by law, but it must have gave 7-Eleven the encouragement to switch additional stores over in North America.
I’m not an expert on supermarket or gas station coolers, but I noticed that when I was reading about this that they only intend to replace the condensers and not the rest of the machine. I am assuming that these are cascade systems that are being replaced and that the other refrigerant used is more climate friendly such as R-744. If any of you know of a different approach that they could be using feel free to let me know. It is always good to learn something new!
The replacement refrigerant known as Solstice N40, or R-448A, is a newer refrigerant from the Honeywell corporation. This refrigerant is a zeotropic blend between numerous refrigerants and is classified as an HFC/HFO mixture. It contains twenty-six percent of HFC R-32, twenty-six percent of HFC R-125, twenty-one percent of HFC R-134a, seven percent of HFO R-1234ze, and twenty percent of HFO R-1234yf. Just by the numbers I would call R-448A an HFC refrigerant rather then an HFO.
R-448A is designed as a replacement for R-404A in supermarket systems and can be used as a retrofit as well as on newer models. The retrofit is fairly simple and has been described as a near drop in replacement for R-404A. Notice I said ‘near.’ There are still some slight adjustments that have to be made before it can be used in an 404A system. 448A is meant for low and medium applications commonly found in super-markets, gas stations, vending machines, and other smaller systems.
It has a Global Warming Potential (GWP) of one-thousand two-hundred and seventy-three. While that is still quite a high GWP it is nowhere near it’s predecessor. R-404A has a GWP of three-thousand nine-hundred and twenty-two. By making the switch to R-448A 7-Eleven will see a nearly sixty percent reduction of GWP. It is also more efficient then R-404A. In the lower temperature applications users can expect to see five percent in energy savings. With the medium temperature systems users can see up to fifteen percent in energy savings.
Lastly, it is safe as well with an A1 rating from ASHRAE. That means it is non-flammable and non-toxic. The flammability rating is a big deal as so many newer refrigerants nowadays seem to sacrifice safety for environment. Take R-1234yf for example, it’s predecessor R-134a was not flammable at all. 1234yf on the other hand is rated as 2L or slightly flammable. It is good to see that a next generation refrigerant is able to tackle both GWP and public/technician safety.
Conclusion
While 7-Eleven moves forward with this new refrigerant the question that I have on my mind is how long will this refrigerant last? Yes, it is a definite improvement over the HFC R-404A but it still has a GWP of over one-thousand. This refrigerant may last for a while and companies can all give themselves a pat on the back for becoming more environmentally friendly, but chances are that they will have to be switching refrigerants again in another five to ten years due to the pressure of getting rid of high GWP refrigerants.
If it was me I would either hold off on replacing/updating my HFC equipment, or if I had to update then I would opt for a natural or hydrocarbon refrigerant such as R-744 or R-290. At least with these you know that you do not have the risk of phase down looming around the corner. If there is one thing business owners can’t stand it is uncertainty.
On April 4th, 2019 a suit was filed by the HFC Coalition to the International Trade Commission (ITC). This suit aimed at stopping the dumping of HFC blended refrigerants such as R-410A, R-404A, and R-407C. The ITC’s decision on rather or not to review the suit was set for a deadline in May, but it was then pushed back to July. We were all expecting a decision to come next month but it was announced at the tail end of this week that the ITC has decided to accept the case and began the inquiry.
There have already been anti-dumping tariffs on HFC blends for a few years now, but the ITC’s ruling back then stated that only the blended refrigerant could be subject to the tariff. The components of these blends were not subject to the tax. So, businesses could import R-32 and R-125 refrigerants from China and face no penalties. These same businesses would then blend the refrigerant here in the States and then circumvent the tariff.
This oversight by the International Trade Commission has led to what we have today. Dirt cheap prices on some of the most common HFC refrigerants used. In essence, the initial levying of tariffs on blended refrigerants had very little impact. Everyone was getting around the tariff by importing components. It was like nothing had changed.
This is where the new suit filed in April comes into play. This case targeted the components of these blended refrigerants. On the original announcement of the suit prices on HFC blends went up nearly forty to fifty percent. As the dust began to settle prices slowly sank back down to pre-suit levels. Now though, the ITC has announced that they will hear this new case.
The Inquiry
As I said previously, the Department of Commerce has decided to began an inquiry on HFC refrigerant components. Originally, everyone had thought that the inquiry would be solely focused the blending process of the components. So, if you imported the components and then blended them into an HFC blend that is tariffed then you would be subject to the tax.
To my surprise though there were four inquiries announced this week. Let’s take a look:
The first inquiry is what we just mentioned above. This is the blending of the components within the United States and circumventing the tariff. If the ITC agrees then a tariff would be installed on the blending process if the components are sourced from China.
The next is what’s known as unfinished blends. I’ll be upfront with you here, I don’t know one-hundred percent what this is but my educated guess is that this is Chinese refrigerant companies blending the refrigerants but NOT to the exact levels to meet the anti-dumping blended requirements. In other words, they get it close to R-410A… but not all the way. This process would also be taxed if the ITC approves.
The next inquiry is similar to our first point. This has to deal with importing components and blending them in a different country. The difference here though is that this is referencing India in particular. In this scenario, China exports the refrigerant components to India and then India blends them to create the blended HFC. This was yet another work around that companies found as the country of origin is India… even though the goods came from China. If approved anti-dumping would be installed in this scenario as well. While the initial inquiry only states India that does not mean that other countries are exempt. Say for example, China imports components into Vietnam and they blend there. If a decision is made here let’s hope it applies to all countries.
The last change is on the blended refrigerant R-421A. This refrigerant blend actually doesn’t have a tariff on it because the product is patented. Patented refrigerants were excluded from the previous anti-dumping order. R-421A is quite similar to the more popular blended refrigerant known as R-407C. So, folks were importing the non-tariff R-421A and then finishing the blend to create R-407C. To give an example here, R-421A is comprised of R-125 (58%) and R-134a (42%). R-407C is comprised of R-32 (23%), R-125 (25%), and R-134a (52%). The only thing missing between these two refrigerants is R-32 and that is easily enough imported in without a tariff. If the ITC rules in favor then these patented blends will see tariffs installed on them as well.
Call these work around what you want. Maybe they are clever loopholes found by hard working businessmen. Or, maybe, they are skirting the edge of the law and they should all be stopped. However you feel, it is all coming to a head now. Now that this inquiry has begun there is a great amount of uncertainty in the market. What will happen? Will they rule in favor of all four? Just some, or none at all?
Pricing Impact
The official inquiry by the Department of Commerce will be hitting the public register on Monday. From that date onwards, June 17th, there will be a three-hundred day period for the ITC to make their decision. Here’s the scary thing though folks. If the ITC decides to impose tariffs in any of the ways we described above then those tariffs could be retroactive. This is huge and this is the main reason we are seeing prices go haywire.
Look at this way. Let’s say I am a business owner and I am going to import a trailerload of R-32 and R-125 into the United States next week. The product comes in, I blend it to R-410A, and then sell all of the product a few months later. I could face a tariff on ALL of that imported product nearly a year after I had imported and sold it. The ITC has the power to make this ruling retroactive and because of that the importing of HFCs has become a lot less attractive. Business owners could be looking at an over one-hundred percent tax on product they already sold.
Everyone who saw this coming bought up on as much product as they could and now that the inquiry has begun prices have begun to rise. A few major manufacturers have already announced their price increases. The question now though is will these manufacturers put limits on what quantities businesses can buy as well? Or, will the high prices be enough?
If you were smart enough to buy ahead you can now make a killing since the import market has all but dried up. Let’s take a look at some of the pricing trends we’re seeing now since this inquiry began just a few days ago:
R-410A – Twenty-Five Pound Cylinder Pricing:
Fall 2017 – $140
Fall 2018 – $65
Jan 2019 – $68
Feb 2019 – $56
Mar 2019 – $49
Apr 2019 – $100 – News of possible tariffs
May 2019 – $78
June 2019 – $65 – Before Inquiry
June 2019 – $100 – After Inquiry
I will state that the $100 is with some vendors. I have seen some say one-hundred and fifty and even some at one-hundred and eighty dollars a cylinder.
R-404A – Twenty-Four Pound Cylinder Pricing:
Fall 2017 – $175
Fall 2018 – $80
Jan 2019 – $70
Feb 2019 – $58
Mar 2019 – $50
Apr 2019 – $105 – News of possible tariffs
May 2019 – $89
June 2019 – $60 – Before Inquiry
June 2019 – $105 – After Inquiry
R-407C – Twenty-Five Pound Cylinder Pricing:
I don’t have as much pricing information on this product but I can still show you the pricing swing that took place this month:
June 2019 – $85 – Before Inquiry
June 2019 – $105 – After Inquiry
Conclusion
With the announcement of these inquiries this week there is now a lot of uncertainty introduced within the market place. It is difficult to say what will happen with pricing now. In the earlier announcements there was still hope that the ITC wouldn’t take up the case, but now that it is official we may see prices stay at these levels, or even go higher. It could go as crazy as two-hundred dollars plus a cylinder late this summer for some of the more popular HFC blends. But, we just don’t know for sure.
After all, it’s been an unseasonably colder summer for most of the country. I just took a bike ride earlier today in seventy-four degree weather. That is unheard of in Kansas in the middle of June. It should be close to one-hundred degrees. I know New England and other areas are experiencing the same thing. This colder weather may act as a buffer to this pending inquiry and help insulate the pricing situation until a decision is made next year.
If you are looking to purchase refrigerant please check out our bulk purchasing page by clicking here. In many cases we can get you the best and most aggressive priced product on the market.
Thanks for reading,
Alec Johnson
RefrigerantHQ
Also, check out our other earlier articles on this same topic:
A few more dominoes fell this week in the HFC phase down across the United States. I had reported a few weeks ago that Washington State’s HFC phase down had passed the legislature and just needed the signature from the governor. Well, Governor Jay Inslee signed bill HB 1112 this week. This adds yet another state to the ever growing list that has begun phasing down HFC refrigerants. We now have California, New York, Maryland, Connecticut, and now Washington State phasing down HFC refrigerants. There are other states as well considering their own legislation.
So far all of these state planned phase downs have been modeled after the original Environmental Protection Agency’s SNAP Rule 20 and 21 from 2015. The same holds true for another state that announced their intentions to phase down HFC refrigerants: Vermont. Yes, Vermont has announced that they are intending to phase down HFC refrigerants as well through their new bill ‘S. 30.’ The bill passed the legislature last week and is expected a signature from the governor soon.
With an effective date of July 1st, 2019 Vermont is wasting no time. Just like with the other states Vermont begins their phase down by targeting R-404A applications and larger cold storage warehouses. 404A is always the first target as it has an extremely high Global Warming Potential. It’s the low hanging fruit of the HFC refrigerants. As the years progress Vermont will target other applications and HFC refrigerants through a staggered approach. The end goal of Vermont’s HFC phasedown is to see a forty percent usage reduction based on 2013 levels by the year 2030.
Vermont, along with twenty-three other states, is part of what’s known as the United States Climate Alliance.’ This alliance was formed when the Trump Administration pulled the United States out of the Paris Climate Accord. The goal of the alliance is to create a coalition of states that work together to fight Climate Change and Global Warming. Their thinking is if the Federal Government isn’t going to do anything then the states will have to.
The other states in the Climate Alliance are all expected to follow suit in the coming years. This all started with California and then we began to see the snowball effect take hold as New York and other New England states announced they were planning HFC phasedowns. Nearly half the states in The Union are part of this Climate Alliance and it’s only a matter of time before more HFC phase down announcements are made. What state will be next?
Conclusion
The Federal Government’s positions on HFC phase down has been a mystery for the past few years. The EPA’s SNAP Rule was thrown out by the courts. The Kigali Amendment went into effect at the beginning of this year but the United States never ratified the treaty. The EPA may announce something soon, but it is unclear what this announcement will be.
I’ve said this before in other HFC phase down articles but as more states are added to the list eventually manufacturing companies are going to be forced to move away from HFCs… even if there isn’t a Federal mandate. If enough states phase out HFCs then manufacturers will either have to produce two different models (One for HFC states and one for non-HFC states), or the manufacturers will have to do a complete switch over to lower GWP refrigerants. If I was in their shoes, I know what I would choose.
Regardless of what happens, we can all be assured that over the next ten years the usage of HFCs will be going down and we will seem them being replaced with either natural refrigerants, hydrocarbons, or HFOs. The industry is getting more diversified and that means more specialized training to deal with these varying refrigerants.
In the beginning of this year I got into the habit of writing refrigerant pricing updates as I saw them coming. Most of these have been fairly benign with a few percent increases here and there. It was last month though that I wrote a pricing update that had pricing doubling on some of the most popular refrigerants in just a matter of days. The article can be found here.
This huge jump in price can be tied to a new suit filed with the Department of Commerce. This suit which was filed by the HFC Coalition aimed at installing anti-dumping tariffs on HFC components. For those of you that do not know, a few years back there were anti-dumping tariffs put on some of the most popular HFC refrigerants used today: R-410A and R-404A. These tariffs targeted Chinese product that was being unloaded in the United States at ultra low prices.
The problem with these tariffs though was how they were written. The tariffs themselves ONLY applied to R-410A and R-404A. Remember folks, that these two products are blended refrigerants. While the tariff was on the finished product it wasn’t on the components to make the blend. So, your refrigerants like R-125 and R-32 were immune from the anti-dumping. This resulted in a halting of imports of R-410A/R-404A and instead we saw massive importing of the components to blend these refrigerants. This flood of refrigerant components caused the price to stay pretty much were it was before the anti-dumping tariffs were installed. Nothing had changed except now distributors were blending Chinese refrigerants in the United States.
The Suit
I won’t get into all of the details here as it would be repetitive from my last article. Instead I’ll give a short summary and then move onto the update. In order to prevent these low prices and the continuing flood of Chinese refrigerants a suit was introduced to the Department of Commerce. This suit aimed at solving the problem when it comes to HFC refrigerant blends by adding a tariff to ANY HFC components that were used to create a blend within the United States. In other words, you can import R-125 all day long but the moment you use R-125 to create R-410A then you have to pay a tariff.
This suit was filed in early April and originally a decision was to be made today May 20th, 2019. Well, the deadline came and went and there was still no decision made. Instead the Department of Commerce issued a statement saying:
“According to 19 CFR 351.225(c)(2), “{w}ithin 45 days of the date of receipt of an application for a scope ruling, the Secretary will issue a final ruling under paragraph (d) of this section or will initiate a scope inquiry under paragraph (e) of this section.” However, “unless expressly precluded by statute, the Secretary may, for good cause, extend any time limit.” We have determined that additional time is required to review and assess the HFC Coalition’s request. Thus, in accordance with 19 CFR 351.302(b), we are extending the time-period for initiating a formal anti-circumvention inquiry by 45 days, until July 3, 2019.”
So, the can has been kicked down the road and we are now left with even more uncertainty. Before I get into pricing I want to make sure everyone understands that IF the DOC decides to take this suit up on July 3rd then EVERY blended refrigerant from July 3rd up until the decision date of the suit could be retroactively taxed the tariff. So, if I imported a heap of R-125 and R-32 in August, mixed them as 410A, and then sold them in September then I could be liable for tariffs… even if the DOC’s decision doesn’t come until February of 2020.
Pricing Update
That clause I just mentioned above is why we saw prices go crazy last April. The price of HFC refrigerants seemed to jump overnight when news of this hit the industry. Everyone was buying up as much as they could from their distributors and the distributors were buying as much as they could from China before a decision was made to accept the suit or not. In some cases we saw prices double.
Today however, I have good news. The prices on HFCs have begun to settle down. It’s hard to say exactly why this is but it appears that the initial shock of tariffs on components have worn off. Or, it could be that everyone and their brother have bought up so much that the demand has ultimately died down. Whatever the reason is prices have gone down since May. While we are still not near where we were before, we are in a much better spot then we were a month ago.
In my last article I did a break down of pricing on R-410A and R-404A. Let’s take a look again but with this week’s prices:
R-410A – Twenty-Five Pound Cylinder Pricing:
Fall 2017 – $140
Fall 2018 – $65
Jan 2019 – $68
Feb 2019 – $56
Mar 2019 – $49
Apr 2019 – $100 – News of possible tariffs
May 2019 – $78
R-404A – Twenty-Four Pound Cylinder Pricing:
Fall 2017 – $175
Fall 2018 – $80
Jan 2019 – $70
Feb 2019 – $58
Mar 2019 – $50
Apr 2019 – $105 – News of possible tariffs
May 2019 – $89
Conclusion
As you can see, we are moving downwards… but it is very tough to say what will happen in the future. There is still a lot of uncertainty in the industry and it is anyone’s guess as to what the Department of Commerce will decide on July 3rd.
One other point to mention here is that there was some talk on the latest tariffs from the Trump Administration. These tariffs are unrelated to the anti-dumping tariffs but are instead retaliatory taxes in the ongoing trade war between the United States and China. They were to be twenty-five percent on selected harmonized codes.
At first I understood that HFC refrigerants, and components, were affected by this tariff. But now, I have heard that an exemption was made specifically for HFC components. I have searched online trying to find specific information but it is quite murky, and I have not been able to find anything concrete. If any of you have further information on this topic please reach out to me and I will update this article.
Thanks for reading and hope everyone has a great Memorial Day! I’ve got a barbecue with my name no it. Cheers!
