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1) Are HFC’s really going away?? well sort of.
2) Canada’s’ Kigali Commitment, should I care?

In case you have not heard, Canada has joined the EU and several other developed countries implementing a scheduled phase down of high global warming (GWP) gases. The refrigerants targeted for phasedown, are the non-ozone depleting refrigerants, we have just become accustomed to as we transitioned out of ozone depleting substances. On Jan. 1 St. 2019, Environment and Climate Change Canada (ECCC) officially introduced a quota or allowance system limiting the overall imports of HFC’s into Canada. The allowance holders are limited to a small group of companies who were actively importing HFC’s into Canada in 2014-2015 and their quota is based on their market share at that time.  

The real issue for refrigerant users is the time frame used to establish the “Baseline” or maximum amount of CO2e allowed to be imported into Canada. Try to think back at how much R410a you were purchasing annually in the years 2011-2013 and compare that to what you purchased last year.  If you are like most, your use of R410a and other HFC refrigerants is 4 to 5 times greater what is was in 2011-13, which is the time frame used to establish the maximum “baseline” that all of Canada will have to live with going forward. The baseline years where just a few years after R22 was official phased out in new equipment in 2010. To make matters worse, the 2019 maximum that quota importers where issued included a 10 % reduction right off the bat to coincide with Kigali commitments made by Canada. To be clear, the “allowance system” does not specifically target R410a, or any HFC refrigerant, as it is solely based on the overall GWP rating of the HFC imported. It will be up to the importers how they decide to use the quota allowed, but in simple terms importing high GWP refrigerants like R404a with a GWP of 3920, will use about 3 times as much quota, then a similar amount of R134a with a GWP of 1430. All things being equal, it would seem inevitable that the higher GWP refrigerants are going to be imported in limited volumes which under basic supply and demand rules will likely mean higher costs. The EU has a similar CO2e GWP based quota system, which caused a 500% to 600% increase in the cost of R404a and R507 in the first couple years of their quota system being implemented.

To add to all this, ECCC has also introduced refrigerant use regulations, again based on maximum GWP levels, which will limit the GWP level for various refrigeration and air-conditioning applications. The HFC use regulations will be kicking in January 2020, but more on these will have to wait, as the ramifications of those regulations are worthy of another article.     

So, bottom line, what does all this mean for your secret stash of refrigerants in your garage? I would ditch the R12 (as it is now worthless), keep the R22, cause, all R22 imports both virgin and reclaimed will be banned on January 1, 2020, add a pinch of R404a (for investment purposes) and maybe add a dash of R410a (just for supply insurance).  

PS: don’t blame the wholesalers for the crazy prices and inconsistent supply, as it really isn’t their fault, this time.

Jim Flowers

Business Director, A-Gas Canada