In recent years, the grocery industry has seen an unprecedented demand for online shopping. To meet the needs of consumers making the switch to online shopping, many retailers are choosing to expand their warehouses or grocers, and that means expanding their refrigerated warehousing. As the footprint of refrigerated warehouse space and infrastructure grows, it’s important to understand how refrigerants align with corporate sustainability goals as well as how to plan for the evolving regulatory landscape.

With new and more stringent refrigerant regulations on the horizon, more clients are exploring alternative refrigeration systems to holistically reduce annual greenhouse gas emissions. CO2, which has the ASHRAE designation of R744, is a natural refrigerant with an ultra-low environmental impact. CO2 has been an intriguing alternative refrigerant for some time, but higher costs associated with the equipment and operation have prevented CO2 from being widely adopted in the U.S., until now.

Fortunately, those previous barriers to CO2 systems are being overcome by greater familiarity, economies of scale, and emerging technologies designed to overcome system inefficiencies. Meanwhile, regulatory restrictions continue to increase on traditional refrigerants.

When looking specifically at grocery stores, 40% of energy consumption is tied to refrigeration systems. The average store can contain up to two miles of refrigerant piping, which is equal to the length of 30 football fields. These pipes and the systems can leak at a rate of 25% each year.

Switching to low-impact, sustainable refrigerants like CO2 will help reduce emissions by 108 gigatons globally. A hundred and eight gigatons is equivalent to the emissions from operating every home in the U.S. for 104 years, or switching four trillion incandescent lamps to LED, or the amount of carbon sequestered by planting 1.7 trillion trees left alone to grow for 10+ years.

Regulations and GWP

Historically, refrigerants used in commercial refrigeration systems are synthetic refrigerants made of either hydrofluorocarbons (HFCs) or blends with both HFCs and Hydrofluro-Olefins (HFOs). These synthetic refrigerants have come under increasing scrutiny because of their high Global Warming Potential (GWP). GWP is defined by the U.S. Environmental Protection Agency (EPA) as “a measure of how much energy the emissions of 1 ton of a gas will absorb over a given period of time, relative to the emissions of 1 ton of carbon dioxide (CO2)”. A higher GWP translates to a higher contribution to global warming and climate change. Most HFC and HFO blends suitable for refrigeration have GWPs ranging from the low 1,000s to nearly 4,000. CO2 has a GWP of 1.

For example, R407A, a widely used HFC, has a GWP of about 2,100, which means when released into the atmosphere, one pound would be 2,100 times more detrimental than one pound of CO2. Annual leak rates (the amount of refrigerant that leaks out of systems) can be up to 25% of the total refrigerant in the systems for a standard grocery chain. A 25% leakage rate for a grocery store refrigeration system with 1,200 pounds of refrigerant would leak 300 pounds/year. In terms of GWP impact, this R407A system would release the equivalent of 630,000 lbs. of CO2 into the atmosphere (300 lbs. x 2,100 GWP). The impact of a comparable CO2-based system would only be 300 pounds (300 x 1 = 300 lbs.) When we account for all the grocery stores and refrigeration systems around the world, it starts to make sense how CO2 emissions can be reduced by 108 gigatons.

Federal Regulations

AIM (American Innovation and Manufacturing) Act

The AIM Act was signed into law in December 2020 and represents the most impactful federal legislation regulating refrigerants in decades. The AIM Act regulates high GWP refrigerants by creating phasedown requirements in the production and consumption of HFCs. The AIM Act also controls the use of HFCs in specific applications by what is referred to as sector-based control limits.

The phasedown schedule was effective in 2022. The market impact will become most evident in 2024, when production and consumption are reduced by 40% compared to the 2020 level.

The EPA proposed sector-based controls are outlined in their report, “Protecting our Climate by Reducing Use of Hydrofluorocarbons”. The sector-based controls have not yet been implemented. A final ruling by the EPA is set for October 2023. Currently, the only commercially available refrigeration system with a GWP ≤ 150 using a non-toxic and non-flammable refrigerant is a CO2-based system.

Clean Air Act: Section 608

In addition to the aforementioned regulations on high GWP refrigerants, the EPA’s Clean Air Act (CAA) Section 608: Regulatory Requirements for Stationary Refrigeration and Air Conditioning limits the allowable refrigerant leak rate on systems with more than 50 lbs. of refrigerant to 20% annually for commercial refrigeration and 30% annually for industrial process refrigeration. The CAA also specifies leak repair requirements and establishes guidelines for refrigerant reclamation, sales restrictions, technician certification, service practices, appliance disposal, equipment recycling, and recordkeeping. This rule was modified on February 26, 2020, so that some of these requirements, such as the leak repair requirements and associated recordkeeping and reporting provisions, will only apply to ozone depleting refrigerants as of April 10, 2020. Nevertheless, these requirements are a bellwether for what can be expected at a state level in the coming years. The California Air Resources Board (CARB) already has a refrigerant management program that requires facilities with refrigeration systems containing more than 50 lbs. of a high GWP refrigerant to conduct and report periodic leak inspections, promptly repair leaks, and keep service records on site.

State Regulations

California has led the way in regulations on HFC reduction. As of January 2022, new refrigeration systems containing more than 50 lbs. of refrigerant in new facilities must use a refrigerant with a GWP ≤ 150. The regulation also requires a phasedown of high GWP refrigerants in existing facilities. The State of Washington is expected to implement a similar, and perhaps more restrictive, regulation effective January 2025. New York and other states are on track to implement similarly restrictive regulations. The state regulations will be in addition to the previously described federal regulations.

CO2 Systems

Transcritical CO2 systems use CO2 (R744) as the sole refrigerant and are so named because CO2 reaches its critical point (the point at which a substance’s liquid and vapor phase boundaries converge and liquid and vapor become indistinguishable from each other) at 87.8°F. Above this temperature, the high-pressure side of the system operates supercritically or transcritically without condensing from a vapor to a liquid. Other CO2 refrigeration systems, such as CO2 cascade or CO2 liquid overfeed systems, avoid the inefficiencies associated with operating transcritically but at the expense of using CO2 in conjunction with another (often high GWP) refrigerant and of incurring the associated costs and inefficiencies of adding additional heat exchangers and associated equipment. For the purposes of this discussion, we will focus on transcritical CO2 systems.

CO2 Advantages

Because CO2 is the baseline when measuring GWP, its GWP is 1. The use of CO2 refrigeration will therefore allow retailers to future-proof their refrigeration systems against any upcoming refrigerant regulation changes at both the state and national levels. Additionally, given its  classification as an A1 refrigerant (non-toxic and non-flammable) by ASHRAE, R744 does not require additional safety mitigation measures. Installation costs have been decreasing as installers have become more comfortable with CO2 systems. Some installers are even reporting lower installation costs compared to systems with synthetic refrigerants due to the smaller pipe sizes used on CO2 systems. Bill Zornes, director of refrigeration at Key Mechanical, states that his company has seen installation costs for CO2 systems that are 10–12% less than traditional refrigerant systems with similar design styles. Bill doesn’t foresee a big learning curve for installers who are less familiar with R744: “I believe there is a small learning curve on the service side, but once technicians understand the system has the same components and operates in the same manner as we have all known it to be, it’s quickly overcome. [On the] installation side, I see no real learning curves providing you are using best industry practices.”

Equipment costs are also coming down as more CO2 systems are installed throughout the United States. Hill Phoenix, a refrigeration system manufacturer based near Atlanta, GA, has installed more than 1,100 Transcritical CO2 systems in North America and more than 15,000 systems worldwide under the brand Advansor. Derek Gosselin, director of technical product support at Hill Phoenix, stated that the equipment costs vary based on design choices and location and that there still is a cost premium of 15–25% for CO2 systems vs. systems using synthetic refrigerants but that the costs are coming down. He notes that it is best to compare the total installed cost, including equipment, refrigerant management, and installation. According to Derek, the total installed cost of a CO2 system can be as little as 5–10% higher compared to equivalently sized systems using synthetic refrigerants. In addition to the environmental considerations, the lower cost of the CO2 itself is another point in its favor. CO2 is about $2/lb. to $4/lb. whereas most traditional refrigerants range from $20/lb. to $100/lb. With decrease in production of HFCs driven by the AIM Act, the cost of traditional HFC refrigerants are likely to see significant future price increases.

Transcritical CO2 Challenges

The efficiency of every refrigeration system decreases as the saturated condensing temperature increases, but the deterioration in efficiency is more dramatic for transcritical CO2 systems. Transcritical CO2 systems can achieve equal or better efficiency than synthetic refrigerant systems at condensing temperatures at or below about 60–65°F, but as the ambient and condensing temperatures rise, the synthetic refrigeration systems become increasingly more efficient compared to transcritical CO2 systems. Thus, any comparison of the annual energy usage between the two systems will be heavily dependent on the location and climate chosen as the basis of the comparison. Chart 2 below gives the results of a study Henderson Engineers performed in 2016 to compare the annual energy usage between a transcritical CO2 system (R744) and systems using synthetic refrigerants R407A and R448A.

The conclusion of this analysis was that energy usage differences were minor in cooler climates but significant in warmer locations. When comparing the overall climate impact of a refrigeration system, the increased energy usage needs to be considered based on the carbon intensity of the electricity sourced from the regional grid. Even in the most unfavorable weather conditions (e.g., warm and wet areas such as Austin, TX), CO2 systems could have a lower life-cycle carbon footprint when factoring in the additional energy use, especially over time as renewable energy sources continue to come online.

Mitigating CO2 Challenges

Limits to compressor operating windows preclude operating CO2 compressors below a condensing temperature of about 55°F. However, advances in technologies that allow lowering the minimum condensing temperature would make the advantages of a CO2 system more pronounced in lower ambient temperatures. Other energy-saving technologies, such as parallel compression, ejectors, and various low-superheat options, are more commonplace for transcritical CO2 systems. Overall, there is reason to think that proper equipment selection and continuing technological advances will make CO2 competitive with synthetic refrigerant systems in cool to moderate climates. And in warmer and more humid climates where transcritical CO2 systems should be expected to use more energy than an equivalent synthetic refrigeration system, other factors such as government regulations and the desire to use natural refrigerants may dictate the use of CO2 refrigeration systems despite any energy penalties associated with the system.

Conclusion

The changing regulatory landscape is requiring our industry to look at alternatives to traditional synthetic refrigeration systems. Sustainable refrigerant design will be a crucial component in grocery stores as they try to reduce their carbon footprint. Transcritical CO2 is not without its challenges, particularly in warmer climates such as those in the southern half of the continental U.S., but increasing contractor familiarity, decreasing manufacturing costs, and continuing technological advances are making CO2 refrigeration systems more viable than ever before.