The American Innovation and Manufacturing Act of 2020, or AIM was passed as part of the 2021 appropriation bill, passed on December 27, 2020. Although you probably would not know it from the title, the AIM Act is about phasing down HFCs. This is a phasedown, not a phase out. This table shows the phasedown schedule. Noite, we started the 60% of baseline period this year.
AIM Act HFC Phasedown Schedule | ||
Date | % of Production Baseline | % of Consumption Baseline |
2020 – 2023 | 90% | 90% |
2024 – 2028 | 60% | 60% |
2029 – 2033 | 30% | 30% |
2034 – 2035 | 20% | 20% |
2036 – | 15% | 15% |
Allowances
Because this is a phasedown and not a phaseout, some HFCs will still be available for a long time. However, ALL HFCs will not necessarily be available. The phasedown is regulated by assigning allocations for production and/or importing HFCs to producers and distributors. How quickly a company uses up their allocation is calculated by multiplying the quantity of HFC produced or used times its exchange value, which is basically its AR4 GWP. For example, R410A has an exchange value of 2088, R32 has an exchange value of 675, and R454B has an exchange value of 465. This means that a company can make 3 times as much R32 as 410A, or almost 4.5 times as much R454B as 410A.
Still Using HFCs?
One interesting situation is that the “new” refrigerants which will be replacing the current high GWP HFC refrigerants also contain HFCs. R32 is an HFC and it is on the list of refrigerants being phased down. Other alternatives being studied, such as R454B, are blends that contain R32. Phasing down R32 will eventually make both R32 and R454B not practical for equipment manufacturers. They will probably be replaced in ten years or less.
Making the Switch
HFC allowances are currently 60% of the baseline. If manufacturers continue to make exactly the same equipment with the same HFC refrigerants that they have been using, they will run out of their HFC refrigerant allowance before the end of the year. I believe most manufacturers will start producing R32 and R454B equipment this year. Just by switching from R410A to R32 a manufacturer can triple the amount of refrigerant they can use. Doing the math 60% x 3 = 180%. Suppose they used up half of their allowance on R410A before switching, that would be 30% x 3 = 90%. This means they could actually increase their overall production. The math is even better for R454B. 60% x 4.5 = 270%, or 135% if you had already used up half your allocation on R410A.
Down the Road 2029
Things get a bit tighter down the road in 2029 when HFCs are restricted to 30% of baseline. Now the R32 calculation is 30% x 3 = 90%, meaning you are restricted to less than the baseline for your entire production. The manufacturer will either have to use a refrigerant with a lower GWP or figure out a way to reduce the charge of the systems they produce. R454B looks a bit better with 30% x 4.5 = 135%, so you are still in business assuming you have not increased production a great deal and you are not using your HFC allocation for anything else.
Down the Road 2034
By 2034 manufacturers will definitely need to have more answers because the allocation drops to 20% of baseline. Now the R32 calculation is 20% x 3 = 60% and the R454B calculation is 20% x 4.5 = 90%: both fall short, and that is before accounting for any growth or using your HFC allocation for any other purpose.
Crystal Ball
In ten years or less I believe we will see systems using other refrigerants start to take over. At this point, I think the manufacturers are thinking HFOs. They are already widely used in car air conditioning and have very low GWPs. What remains to be seen is whether they will be widely accepted. The European Union is pushing back against fluorochemicals in general. They want “natural” refrigerants such as propane or carbon dioxide. Europe seems more comfortable with R290 in larger systems than we are in the US. I don’t think the added fire risk of R-290 is going to be accepted in larger systems in the US. I don’t believe CO2 is practical in smaller systems the size of residential air conditioners and heat pumps. Whatever the form, I believe in ten years we will be looking at very different equipment.