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California’s HFC Phase-down: Costs, Energy, Leaks and Incentives

RajanRajendran2 Rajan Rajendran | V.P., System Innovation Center and Sustainability

Emerson Commercial & Residential Solutions

As Jennifer Butsch and I discussed in our most recent E360 Webinar, the California Air Resources Board (CARB) has adopted the Environmental Protection Agency’s (EPA’s) Significant New Alternatives Policy (SNAP) regulations 20 and 21. ACHR NEWS, which attended our webinar and CARB’s most recent public stakeholder meeting, has compiled a report on the implications of CARB’s hydrofluorocarbon (HFC) phase-down efforts. Below is a synopsis of their article, which you can read here in its entirety.

California’s HFC Phase-down: Costs, Energy, Leaks and Incentives

In early March, CARB held its first of several public technical working group meetings of the year. While the focus of this workshop was on stationary AC equipment, the scope of the issues discussed also extended to matters impacting commercial refrigeration. The purpose of these meetings is to gain insights into the many questions surrounding the implementation of its current and future regulations governing the state’s HFC phase-down. In this session, CARB posed several questions related to equipment costs, refrigerant leaks, the intersection with energy efficiency regulations and incentives for making the transition to lower-GWP refrigerants. And while these questions were targeted to California stakeholders, their relevance extends to the larger United States, where it is estimated that a federal mechanism to phase down HFCs will eventually be reinstated.

First costs, installation and maintenance

As we discussed in our most recent webinar, the commercial refrigeration sector is where the industry will continue to experience a proliferation of refrigeration systems. But this presents a series of challenges for OEMs and component manufacturers as we attempt to balance refrigerant GWP limits with economic viability — with hopes to minimize first costs, install costs and long-term service expenses of new equipment.

Opinions about cost considerations varied at the CARB meeting, though attendees generally agreed that first costs on AC equipment could range from 5 to 15 percent in various categories of equipment. CARB estimated that install and maintenance costs could increase anywhere from 5 to 10 percent, especially considering the need for additional contractor and technician training and tools to work with lower-GWP refrigerants such as A2Ls.

Factoring energy into the equation

For OEMs, meeting CARB’s GWP limits is only one of the regulatory milestones they will face in the next few years. The Department of Energy’s (DOE’s) new energy efficiency requirements are scheduled for 2023, which means OEMs need to factor both energy-related equipment upgrades and the refrigerant transition into their design cycles. This was another topic of debate at the CARB meeting.

CARB members suggested that OEMs could try to offset upgrade expenses and achieve economies of scale by combining design cycles. Representatives from the Air-Conditioning, Heating and Refrigeration Institute (AHRI) took the position that these upgrades would require separate efforts. To help CARB understand the implications of these scenarios, AHRI cited survey data in which its members considered the costs of efficiency upgrades before addressing required refrigeration changes.

Leak reduction and prevention

Meeting attendees reached a consensus when discussing the problem of refrigerant leaks. As an AHRI representative pointed out: none of California’s GWP targets will be attainable if the industry can’t figure out this critical issue. They cited a UN Environmental Program report that estimated up to 60 percent of GWP sources from HVACR equipment can be traced to leaks.

And as we reported in our recent webinar, supermarkets that in the EPA’s GreenChill program have achieved drastically reduced leak rates, sometimes more than 50 percent. It’s also a reminder that as California and the rest of country continue their transitions to lower-GWP refrigerant alternatives, proper reclamation, recycling and disposal of HFCs will be extremely important.

Incentivizing participation

When the California Senate Bill No. 1013 (aka the California Cooling Act) was passed in 2018, it included an incentive mechanism via the Fluorinated Gases Emission Reduction Incentive Program. To date, this program has remained unfunded in the 2019 budget, although there still is yet a possibility for budget adjustments this year.

As was noted in the article, California’s tradition of incentives has helped create momentum to move the state toward lower-GWP refrigerants, systems with lower leak rates and better recordkeeping. Regardless, early adopters of climate-friendly cooling will have a variety of options from which to choose for new low-GWP systems, retrofits and upgrades.

What’s next?

CARB has stated that it will hold further stakeholder meetings this year, including a workshop focused on commercial refrigeration at the end of May. These meetings will conclude with a draft of the proposed new rulemaking along with continued economic analysis. As the industry awaits an update from the EPA on HFC-related regulations, California continues to be the country’s torchbearer for low-GWP refrigeration and cooling systems. As I was quoted in the article, our industry still has a lot of learning to do in the next four or five years, as the refrigerant transition will continue to drive equipment changes.

 

HVACR Contractors Offer Practical Perspectives on Refrigerant Regulations

BobLabbett_Blog Bob Labbett | V.P. – Aftermarket Distribution, Cold Chain

Emerson Commercial & Residential Solutions

At a recent E360 Breakfast, Emerson hosted a panel of three Atlanta-area HVACR contractors to glean their firsthand insights into the biggest challenges and emerging trends impacting their businesses and customers. A recent article covers a wide range of topics and issues, including this discussion about the impacts of refrigerant regulations on contractors and their customers. You can read the full article here.

The service impacts of refrigerant regulations

Imagine showing up to a job site and not knowing which refrigerant is being used in the refrigeration or AC system. According to Martin Hoover, owner of Empire Heating & Air Conditioning in Atlanta, this has become an all too common scenario. “When pressures aren’t reading true, we have to start from scratch with a total refrigerant evacuation, recovery and recharge before even attempting a diagnosis,” he said. Hoover noted that the transition from legacy refrigerants to today’s lower-GWP options comes at a cost, even for those refrigerants that are considered “drop-in” replacements.

Michael Duffee, owner of Restaurant Equipment Services, Inc. of Tucker, Ga., added that customers are not happy to see recovery and disposal fees tacked onto their bill, and this is putting competitive pressures to use shortcuts on small contracting businesses. “Many companies may not be following proper recovery protocols to win business, which can put companies like ours at a disadvantage,” noted Duffee. “It is obviously counterproductive from an environmental standpoint.”

When asked if customers were even interested in the trend toward using lower-GWP refrigerants, Duffee said that in his experience, cost considerations are his customers’ first priority. Even if their legacy systems are leaking, customers are reluctant to invest in replacement equipment. They may be more open to discussing new refrigerants when that investment eventually becomes inevitable.

Presenting new refrigerants as an opportunity to add value

Jim Wharton, area vice president of Link Network, ABM in Atlanta, serves a much larger enterprise customer base. He said his customers have demonstrated more interest in making these investments, and his company is trying to frame the transition as an opportunity. “It’s challenging to align customers’ goals with the available equipment options, but there are some cases where federal and regional regulations are forcing a change.” Wharton added that change isn’t always good news for customers, but he helps them understand the real values of their investment, including total lifecycle costs, energy efficiency and performance advantages.

Too many options result in too much complexity

All three of the contractors said that refrigerant uncertainty is also adding complexity to the equipment decision-making process. Hoover noted his customers are concerned about the long-term viability of the changes. “The last thing they want after investing in a new system is for it to be phased out in four to five years due to a refrigerant change.” All three contractors agree that the industry would benefit by standardizing. Hoover added, “Preferably, we’d like to see one refrigerant, not five or six different options, to replace the old ones.” He pointed out that many contractors simply aren’t able to carry multiple varieties of refrigerants in their trucks at all times. And since these different refrigerants often have unique performance characteristics, variety only adds complexity to service calls.

At Emerson, we’ve seen the wide range of new refrigerant options as a technical challenge, developing equipment and retrofits to accommodate and optimize their performances. But it’s our interactions with contractors and customers that give us insights into how options ultimately impact end users. Their answers shed much-needed light on potential solutions — such as a press toward a single, standard and regulatory-compliant refrigerant.

HVACR Contractors Discuss the Potential of New Technologies

BobLabbett_Blog Bob Labbett | V.P. – Aftermarket Distribution, Cold Chain

Emerson Commercial & Residential Solutions

At a recent E360 Breakfast, Emerson hosted a panel discussion among HVACR contractors to glean their insights and opinions on the biggest challenges and emerging trends impacting their businesses. It was a valuable opportunity to get a working perspective on issues more often discussed by industry analysts. A recent article covers a wide range of topics, including talks of new, high-end technologies at a practical level. You can read the whole article here.

The new technologies, IoT and analytics in the field

In recent years, the HVACR industry has experienced an influx of new electronic controls, connected technologies and data analytics enabled by the internet of things (IoT). As these technologies have come online, each of the three contractors on the E360 panel, with companies and customer bases of different sizes, has had different degrees of experience and interaction with these technologies in the field — from working with component-level information to gathering insights on facility management.

Making better use of data and analytics in the enterprise

Jim Wharton, area vice president of Link Network, ABM in Atlanta, works with an enterprise-level customer base. He explained that while data collection capabilities have been available for decades in different forms of energy management systems (EMS), many operators don’t use them to their full potential. Many may glance at their facility dashboards, see multiple areas running in the red (out-of-tolerance conditions), and may simply ignore the potential problems. “Most operators know the way their building behaves, and if they see an alarm in a certain area, they also know whether it will go away or if they need to act on it,” he said. He added that advanced data analytics now offer more insights and the potential to add tangible operational value by helping to drive informed decision making, detecting performance trends and providing equipment diagnostics and troubleshooting.

Embracing new technologies at home

Residential consumers are also embracing whole-home automation, said Martin Hoover, owner of Empire Heating & Air Conditioning in Atlanta. He said that his customers love getting notified of routine maintenance items, such as when to change filters or fix a water clog or leak. But most importantly, homeowners are using these systems to diagnose problems. “They like the fact that their home automation systems can let us know if something’s broken, so we can fix it before it affects their comfort levels,” said Hoover. But from a contractor’s perspective, he stressed that a home system also helps properly trained and educated technicians perform their own diagnostics. “This doesn’t allow us to take someone straight out of high school and put them in the field, but it certainly makes it easier,” he added.

On-board compressor controls are also helping service contractors gain deeper insights into overall refrigeration system performance. Michael Duffee, owner of Restaurant Equipment Services, Inc. of Tucker, Ga., cautions that these advanced controls require trained technicians. “If they’re not familiar with the technology, then you have to train them to avoid misdiagnosis, as there’s still the potential for things to go wrong,” he said.

Developing new technology for the real world of refrigeration

Designing new sensor technologies to be resistant to the impacts of weather, water and humid conditions are also very important considerations for Duffee. For example, he said, “In walk-in cooler environments, where it’s wet and sometimes caustic with the food and so forth, we’ve seen issues with consistency and where sensors and microprocessors can cause problems.”

With our broad knowledge of the full range of commercial refrigeration applications, Emerson keeps these environmental considerations upfront as we develop and introduce next-generation sensors and controls. For applications as simple as automated residential controls or as the source of real-time data for enterprise and IoT analytics, Emerson continuously consults with end users on the real-world issues raised by new technology.

How HVACR Contractors Are Responding to the Labor Shortage

BobLabbett_Blog Bob Labbett | V.P. – Aftermarket Distribution, Cold Chain

Emerson Commercial & Residential Solutions

At a recent E360 Breakfast, Emerson hosted a panel discussion among HVACR contractors to glean their insights and opinions on the biggest challenges and emerging trends impacting their businesses. In an article written about the discussion, a wide range of topics was covered, from the impact of new regulated refrigerants to the potential of today’s emerging high-end technologies, and more. One issue dominated the discussion: the impact of the labor shortage in contracting businesses. You can read the entire article here.

“We all would agree that labor is our number one issue.”

This statement by Martin Hoover, owner of Empire Heating & Air Conditioning in Atlanta, phrases American HVAC contractors’ key concern in a nutshell. Throughout the panel discussion, the technician shortage was a recurring theme — regardless of the topic discussed. When the conversation zeroed in on their labor challenges, each contractor was eager to detail how it was impacting his business and what steps the industry could take to help improve the situation.

The recruiting is non-stop

Finding qualified candidates starts at the company level, and each panelist has different approaches to the recruitment, onboarding and training processes. Hoover said his recruitment never stops. “We’re a small company and we recruit 24/seven/365,” he said. His company has developed an accelerated career progression plan for promising candidates, one specially designed to appeal to younger people new to the trade. “We’ve divided career steps into 30-day increments, which engages the younger generation from the entry level and allows them to progress very quickly,” he said. The goal is to accelerate their path to senior technician level and provide ample avenues for advancement.

Changing the perceptions of a valuable skill

Michael Duffee, owner of Restaurant Equipment Services, Inc. of Tucker, Ga., said one of his biggest recruitment hurdles continues to be the negative public perception of the trade. “Let’s face it, the trades sometimes have a less than positive image, and our trade is very demanding,” he said. “We get our hands dirty, we work with heavy equipment, on rooftops in the pouring rain, in snow and 100-degree temps.” Because of these factors, Duffee’s company places a premium on candidates who are enthusiastic and possess positive personality traits.

According to Duffee, the industry needs a renewed focus at the high school level to promote the trades. As experienced technicians retire from the industry, Duffee sees the labor shortage only getting worse in the coming years. “We all should be aware and take whatever steps necessary to change this trend,” he concluded.

Putting HVACR careers on the radar

Adding to Duffee’s point, Jim Wharton, area vice president of Link Network, ABM in Atlanta, noted that HVACR has fallen off the radar of many high schools with trade programs. “When you talk to high schools about trades, no one is talking about HVACR, so most don’t know it is an option.” Instead, Wharton’s company relies on alternative sources for recruitment, reaching out to former members of the U.S. military, vocational schools and technical colleges, and career and technical organizations.

Wherever recruits are found, Hoover stresses that on-the-job experience is the final step toward developing a well-rounded technician. “Tech schools don’t really teach someone how to present yourself to a customer and have the proper communication skills,” he said.

New challenges in HVACR bring new opportunities to technicians

With the introduction of new refrigerants and technologies, there’s no question that the HVACR service technician trade is more challenging than ever. But within this growing knowledge base lie growing career opportunities. As Hoover pointed out, “The technician shortage will drive up pay rates.” And the influx of connected technologies, software and analytics transforming the industry may help make the job more attractive to younger, tech-savvy candidates.

At Emerson, we believe that creating awareness of HVACR technologies and career opportunities at high schools and technical colleges is one of the keys to attracting the next generation of candidates. Even as technologies advance to provide more proactive and predictive capabilities, the industry will still need highly skilled individuals in the field to apply their own experiential know-how to system diagnosis and repair.

 

[New E360 Webinar] GreenChill Will Report on Supermarket Refrigeration Trends in New E360 Webinar

JohnWallace_Blog_Image John Wallace | Director of Innovation, Retail Solutions

Emerson Commercial & Residential Solutions

For more than a decade, the Environmental Protection Agency’s (EPA’s) GreenChill Advanced Refrigeration Partnership program has worked with supermarkets across the country to help them implement “greener” refrigeration strategies. In our next E360 Webinar, Tom Land, manager of the program, will present findings from GreenChill’s recent report examining 10 years of supermarket data trends. Join us on Thursday, June 20 at 2 p.m. EDT/11 a.m. PDT for this informative update.

As we all know, the supermarket industry is experiencing a significant transition in its approach to refrigeration. Global, federal and regional environmental regulations have mandated the use of more environmentally friendly refrigeration alternatives. At the same time, many supermarket retailers are being driven by corporate sustainability objectives as well as market pressures to implement more sustainable practices in all their operations. The net result is an industry that is in varying degrees of conversion, from legacy refrigeration systems to new alternatives that do not rely on ozone-depleting refrigerants and offer lower global warming potential (GWP) and improved energy efficiency.

Since launching in 2007, the EPA’s GreenChill program has partnered with companies representing nearly one-third of U.S. supermarkets. Its goals are to reduce refrigerant emissions and decrease their negative impacts on the environment. To date, more than 350 individual stores have met GreenChill’s stringent certification criteria by demonstrating their commitment to environmentally friendlier commercial refrigeration systems with minimal leaks.

Because of its unique position, the GreenChill program is a microcosm for understanding larger refrigeration trends in the food retail industry — as well as providing insights into how companies are responding to increasing environmental mandates. In our next E360 Webinar, which will take place on Thursday, June 20 at 2 p.m. EDT/11 a.m. PDT, Tom Land, manager of the EPA’s GreenChill program, will report on the 10-year data trends gathered from companies participating in the program.

Attendees will learn:

  • Emissions and refrigerant leak rates of refrigeration systems
  • Types of refrigerants installed and emerging system architectures
  • Technology innovations and refrigerant transition trends in GreenChill-certified stores

Register now for this informative free webinar.

 

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