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F-gas threatens Euro manufacturers

GERMANY: The German air conditioning and refrigeration industry has warned that refrigerant shortages and high prices risk putting European equipment manufacturers at a severe disadvantage in global markets.

At a meeting with the German Environment Agency (UBA) Umweltbundesamt in Dessau, yesterday, a group of seven associations were joined by EPEE and the European Heat Pump Association (EHPA) in voicing their concerns over the state of the refrigerant market in the face of the European HFC phase down.

In a joint statement, the groups called for pre-charged equipment manufactured in Europe and exported out of the EU to have the refrigerant credited back to the allowable quota. The associations also called for greater clarity on the use of flammable A2L and A3 refrigerants in the light of current construction law and safety regulations.

While emphasising that they supported all efforts to sustainably reduce global greenhouse gas emissions, the associations point out that the F-gas Regulation interferes with the market structure to the detriment of the consumers of refrigerants and their customers, and presents considerable challenges for the industries concerned.

The meeting was instigated by the three industry associations BIV, VDKF and ZVKKW, after complaining at the end of last year that their members had been reporting “massive” refrigerant supply problems. This not only affected the high GWP refrigerants such as R404A or R507, companies were also reporting shortages of other refrigerants, like R134a.

The joint statement claims that the pace and extent of developments in recent months has not been foreseen and had overrun many companies. “Thus, the prices of the main marketable refrigerants according to official surveys commissioned by the European Commission between the first and third quarter of 2017 has risen by a factor of 2 to 5,” the group states. “In view of the fact that the  quota volume of 93% of the baseline available in 2017 should be sufficient in principle, these price increases have not been foreseeable for many companies.”

They argue that this sudden development affects especially small and medium-sized service companies, which are confronted with sometimes serious procurement problems. “The plant operators, who have to bear significantly higher service costs or whose systems can only be maintained with a delay, are indirectly affected as well.” it says.

With pre-charged equipment now included in the phase down, all pre-filled devices placed on the European market, whether manufactured in Europe or imported, must be included within the quota system. However, the group claims that pre-filled equipment subsequently exported outside of Europe is not credited back to the quota. It is estimated that this could account for at least 5% of the currently available quota.

“This handling bypasses the objective of the F-gas regulation and could even be counterproductive,” the statement says. In addition the associations claim that European manufacturers, while pioneering the use of lower GWP refrigerants are being disadvantaged by the shortage of refrigerants and “excessive” prices. “They are losing out in global competition, with the result that other companies outside Europe, who are more likely to use higher GWP refrigerants, are taking over the market,” they claim.

The signing associations are:

BIV, the Federal Guild of German Refrigeration Contractors
BTGA, Federal Industrial Association of Building Services
BDH, Federal Association of the German Heating Industry
BWP, Federal Heat Pump Association
EHPA, European Heat Pump Association
EPEE, The European Partnership for Energy and the Environment
FGK, the Association of Building Climate
VDKF, Association of German Refrigeration and Air Conditioning Companies
ZVKKW, Central Association of Refrigeration, Air Conditioning and Heat Pumps

Related stories:

German government to discuss gas shortages18 December 2017
GERMANY: The German refrigeration and air conditioning industry has been granted the opportunity to put its concerns over refrigerant shortages to the German government. Read more…

Germany reacts to refrigerant shortages – 21 November 2017
GERMANY: Leading German air conditioning and refrigeration associations are demanding meetings with the government over refrigerant shortages. Read more…

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