What to know about the upcoming R22 phase out

The amount of virgin R22 production from 2012 through 2020 in millions of pounds. The production has greatly decreased, and production will cease all together by 2020. Courtesy AllTemp Solutions, EPA

Matt Koenig
Sales manager, Haynes Mechanical Systems, Greenwood Village

R22 refrigerant is being phased out and property managers and building owners are likely going to be caught off guard. The problem – good for the environment, bad for operating expense budgets – is that the Environmental Protection Agency has begun a phase-out program for R22 refrigerant set to completely eliminate new production and imports in the marketplace by 2020. This issue is coming on the heels of several other recent initiatives affecting building heating, ventilation and air-conditioning systems such as Energize Denver. Most owners and managers see this phase out as just another impending expense that’s out of sight and out of mind. Unless owners and managers have the in-house expertise or a trusted vendor partner, the waters of “what to do with my R22 system” can be tricky to navigate.

The most immediate effect is the sheer cost of R22. In 2013, a pound of R22 refrigerant might cost you around $11 per pound retail. Today, the cost we are seeing in the marketplace can be as high as $37 per pound retail. That’s a 300 percent increase in cost and when some systems carry over 200 pounds of refrigerant – a catastrophic loss will be a costly expense. Supply houses have begun to stockpile, but the demand simply is outweighing the supply.

There are companies claiming “drop-in” style refrigerants at a lower price point that are made to be added to R22 in current systems. However, we’ve seen ill-fated results in compressors, valves and other components due to the different oil properties that current systems don’t account for.

What’s more, due to the spike in cost, we are seeing an uptick in unfamiliar brands advertising cheap R22, among several other refrigerant types. Buyer beware, these brands may be counterfeit and contain compounds such as R-40 and other contaminants that often come from countries outside the U.S. Simply dropping counterfeit refrigerant into existing systems can cause major damage to components within the refrigerant system, cause premature replacement of your overall systems and injurious equipment failures. It is good practice to stick with familiar brands from reputable, reliable sources if you plan on purchasing or stockpiling yourself.

The first step in preparing is to identify if you have a system that uses R22 refrigerant. If your system is more than 10 years old and sits on your roof (air cooled, not water cooled), chances are that you do. The second step is to determine how large your system is. This will determine your overall strategy of simply adding more leak checks to your maintenance program, engineering a conversion or replacing your system all together.

For smaller systems that are 5 tons or less, we recommend increasing the maintenance visits to include at least four leak checks per year, repairing leaks immediately, and recovering, recycling or reclaiming refrigerants.

For equipment larger than 5 tons, we recommend the same strategy of increasing leak checks but also recommend exploring the potential of a refrigerant conversion to an alternative refrigerant. Alternative refrigerants such as R438A and others are recommended for equipment 15 tons and less that do not have an effective means to drain oil. Alternative refrigerants such as R407C and others are recommended for equipment larger than 15 tons with an effective means to drain oil.

Either way, there needs to be some engineering performed on a system-by-system basis. This practice is needed to determine if converting to an alternative refrigerant is a viable option given that such a conversion will impact the energy efficiency and cooling capacity of the original system. In some cases, other technologies such as evaporative pre-coolers for condensers must be used to ensure the system will operate adequately after the conversion.

Deciding to pay for a refrigerant conversion obviously will depend on the age of the system. You don’t want to sink money into a system that is approaching or past its useful life. ASHRAE gives packaged unitary equipment a median lifespan of 15 to 20 years, so your system really has to be in the 10- to 14-year mark if you want to explore a conversion. If your system is more than 15 years old, your best bet is to plan for a capital expense to replace the unit.

The converting of refrigerant also can create issues for potential buyers of new buildings. In most cases, the documentation and maintenance records for equipment is largely lacking from sellers and it is incredibly important to know if a building’s system has gone through a conversion. Buyers need to ask what type of refrigerant systems are in prospective buildings and perform an analysis of refrigerant if there is reason to believe a system has been converted or contaminated.

If you’ve done the analysis and determined you have to replace the system, the next step is working with a partner who understands the various options and can help you develop your financial strategy. Some owners and managers are using the Colorado Commercial Property Assessed Clean Energy program as an option to perform change outs of their R22 systems. This strategy allows for a holistic change out of systems while still maintaining positive cash flow but often needs to occur at the same time as a lighting retrofit and/or building automation upgrade.

Featured in CREJ’s October Property Management Quarterly.

Edited by the Colorado Real Estate Journal staff.