It seems as if we enjoy shooting ourselves in the foot. Back in 1990, Congress passed the latest modification of The Clean Air Act. Among other things, the 1990 version required the Environmental Protection Agency (EPA) to set up a program for phasing out the production and use of chemicals that have a high ozone-depletion potential, such as chlorofluorocarbons (CFCs) and hydrochlorofluorocarbons (HCFCs). This included refrigerant R-22.
In May 1993, the EPA set up regulations to ban the production of heat pumps and air conditioners that contained R-22 after December 31, 2009. Some manufacturers anticipated this deadline and produced extra R-22 units for sale after the production ban went into effect. Six to nine months into 2010, most of these “extra” units ran out, and consumers had no choice but to replace their cooling units with complete matched systems using R-410a. Not only was this good for the environment because fewer HCFCs were being produced that could be released, it should have been good for contractors, because we could start selling complete R-410a systems. It also should have been better for consumers because a complete system should have better energy efficiency and a longer life than a system made up of mixed-and-matched equipment.
Alas, sometime during 2010, after most of the R-22 units made in 2009 ran out, an HVAC equipment manufacturer discovered a loophole in the law. They saw that it was allowed to manufacture and sell system components as long as these components contained no refrigerant. The reason for this wording was to allow items such as coils, compressors, and the like to be manufactured to repair existing systems. A manufacturer decided a condenser was a component, not a complete system, and therefore was a repair part. The EPA didn’t challenge this, and many more manufacturers started manufacturing “dry” (uncharged) outdoor units.
I recently talked to the suppliers in my area. I asked them how many dry units they sell compared to complete R-410a systems. One supplier told me it was about even. Several more said they sell slightly more dry units than R-410a systems. One supplier told me they sell four to five times as many dry units as complete systems.
That’s not right. The allocation rights were designed to allow contractors to service existing equipment without experiencing shortages; they were never intended to permit continued production of equipment that uses R-22. But that’s what has happened. Fortunately for contractors, until recently R-22 has been available and affordable, because the existing allotments were more than enough to meet demand. So even those installing dry units have been able to buy enough R-22 at a reasonable price to continue operations.
The whole idea of phasing out R-22 units 10 years before production of R-22 ceased was so there would not be a large inventory of nearly new R-22 units with no way of servicing them. Imagine a consumer buying a dry unit in 2018, then three years later needing R-22 added because the older indoor coil had sprung a leak. A contractor could put in a new air handler and change the metering device, but where would he get R-22 to charge or top off the system? The consumer would have to replace the whole thing all over again and throw away a three-year-old condensing unit. So now the EPA has to contend with closing an unintended loophole. I can’t say that I didn’t see this coming. Everyone in the industry had to realize that there would be some repercussions. Well, the repercussions are here now.
According to the Heating, Airconditioning & Refrigeration Distributors International (HARDI), from 2005 through 2010, only about 77% of consumption allowance for R-22 was used, so there was a surplus of R-22 in the market. Thus, the EPA has revisited the allocation question—not just for now, but for the future.
On December 30, 2011, the EPA published its proposed rule for HCFC-22 Production and Consumption Allocation Rights for 2012. The previous rule allocated 100 million pounds in 2011 and 90 million pounds in 2012. In the new rule, the EPA has proposed to reduce the 2012 allotment for production and import to between 55 million pounds to 80 million pounds. Since this was a proposed rule, for the first part of January, 2012, it was illegal to produce or import into the U.S. any R-22 for air conditioning or refrigeration. Once this became known, panic buying ensued.
On January 20, the EPA issued “non-enforcement” letters to producers and importers so that reduced levels of R-22 would be available until the final rulemaking is made. However, the non-enforcement letter states that the production and importation of R-22 should be limited to 17% of the 2011 baseline until the final rulemaking. This will keep supplies of R-22 tight. Once the final rule is written, importation and production of R-22 can be increased or decreased to meet the restrictions imposed by the final rulemaking.
Meanwhile, prices for R-22 have skyrocketed. As of this writing they seem to have stabilized, as no contractors are buying pallet loads at the new pricing. Panic buying has stopped for now. But even a contractor who purchased significant amounts of R-22 prior to the big price increases still has to charge the customer enough for R-22 so he can afford to buy new refrigerant when his supplies run low.
The question remains: Are we going to stop shooting ourselves in the foot, and start selling matched systems to customers so they receive the full efficiency, capacity, and longevity they paid for? Or, are we going to continue selling mismatched dry units with no idea of the performance they ultimately deliver?
If we choose the latter, there’s the possibility of further repercussions. I hope we have enough vision to make the first, wiser choice.
Kevin ONeill, CM, is the co-owner of ONeill-Bagwell Cooling & Heating, Myrtle Beach, SC. He has 35 years of experience in the HVAC service business and is a 28-year member of Refrigeration Service Engineers Society (RSES). Kevin can be reached at 843/385-2220, or by email at firstname.lastname@example.org.