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Prepared for the Department of the Environment

8 April 2015

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Assessment of environmental impacts from the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989

Table of ContentsGlossary.......................................................................................................................................7

Abbreviations............................................................................................................................12

1 Executive summary..............................................................................................................14

2 Introduction.........................................................................................................................242.1 Modelling Frameworks....................................................................................................................................................242.2 Model Outputs......................................................................................................................................................................252.3 Equipment Categories...................................................................................................................................................... 272.4 GWPs of ODS and SGGs.....................................................................................................................................................30

3 BAU Model...........................................................................................................................313.1 BAU Sales Mix....................................................................................................................................................................... 38

4 No Measures Scenario..........................................................................................................404.1 Modelling framework....................................................................................................................................................... 404.2 No Measures: Model Outputs........................................................................................................................................454.2.1 No Measures: Bank.............................................................................................................................................................. 454.2.2 No Measures: Total Direct Emissions.......................................................................................................................... 474.2.3 No Measures: Emissions 2014 to 2030....................................................................................................................... 484.2.4 No Measures: Disposable and Refillable Cylinders................................................................................................494.2.5 No Measures: Destruction................................................................................................................................................ 514.2.6 No Measures: Indirect Emissions.................................................................................................................................. 524.2.7 No Measures: End-of-life................................................................................................................................................... 53

5 New Measures.....................................................................................................................555.1 GWP Restrictions and Sales Mix...................................................................................................................................555.2 Leak Reduction Strategy..................................................................................................................................................615.3 Maintenance..........................................................................................................................................................................645.4 Log Books............................................................................................................................................................................... 665.5 New Measures Combined................................................................................................................................................67

6 Enhanced compliance and workforce engagement...............................................................686.1 Data the key to understanding the workforce and measuring economy wide benefits......................686.2 Workforce data can assist target improved handling practices....................................................................686.3 Improved Handling Practices with Mobile Air Conditioning Service..........................................................72

7 End-of-Life Equipment and Vehicles.....................................................................................757.1 End-of-life Refrigeration and Air Conditioning.....................................................................................................767.2 End of life Vehicles............................................................................................................................................................. 79

8 Fire Protection Systems........................................................................................................828.1 Introduction.......................................................................................................................................................................... 828.2 Model Outputs......................................................................................................................................................................848.2.1 Fire protection summary.................................................................................................................................................. 848.2.2 Fire Protection Bank.......................................................................................................................................................... 858.2.3 Fire Protection Consumption.......................................................................................................................................... 868.2.4 Halons....................................................................................................................................................................................... 888.2.5 Fire Protection New Measures....................................................................................................................................... 898.2.6 Model Assumptions............................................................................................................................................................. 91

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8.2.7 Emerging Technology and the Bank........................................................................................................................... 91

9 Conclusions and Recommendations.....................................................................................93

AppendicesAppendix A: Summary of the direct and indirect emissions by measures for 2003 to 2013; 2014 to 2020 and 2021 to 2030

Appendix B: GWP Threshold timetable modelled

Appendix C: Leak rates assumptions for each scenario

C1: Business as Usual

C2: No Measures

C3: Leak Reduction and Maintenance

Appendix D: New equipment sales mix for each scenario

D1: Business as Usual

D2: No Measures

D3: Leak Reduction and Maintenance

Appendix E: Methodology

Appendix F: Direct Emissions, GWPs and refrigerant compositions

Appendix G: Leak Reduction and Maintenance thresholds

Appendix H: Indirect emissions

Appendix I: End-of-life assumptions and outputs

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List of FiguresFigure 1: 2013 service consumption by major sector based on bottom-up analysis of equipment, % share by tonnes..........29Figure 2: 2013 bank by major sector based on bottom-up analysis of equipment, % share by tonnes...................................29Figure 3:Refrigerant bank transition from 2013 to 2030 by gas species in tonnes based on model assumptions..................31Figure 4: Refrigerant bank transition from 2013 to 2030 by gas species in Mt CO2-e (AR4) based on model assumptions....32Figure 5: Projected refrigerant consumption from 2013 to 2030 by gas species in tonnes and Mt CO2e based on model

assumptions..................................................................................................................................................................34Figure 6: Calculated refrigerant leaks of SGGs from 2013 to 2030 by gas species in tonnes and Mt CO2e based on model

stock and leak rate assumptions...................................................................................................................................37Figure 7: Projected sales mix of new supermarket equipment from 2013 to 2030 by gas species.........................................38Figure 8: Transition of the bank in Mt CO2e and ODP tonnes for No Measures and BAU from 2003 to 2030.........................46Figure 9: Additional Direct Emissions for No Measures Scenario versus BAU baseline from 2003 to 2030............................49Figure 10: Direct Emissions for Savings from GWP Restriction Measures commencing 2017 in Mt CO2e..............................57Figure 11: Small MAC Bank BAU and GWP Threshold Measures in tonnes............................................................................58Figure 12 Transition of the Small MAC bank in Mt CO2e for BAU and New Measures from 2014 to 2030.............................59Figure 13: Direct Emissions for Savings from Leak Reduction strategies from 2017 to 2030 in Mt CO2e................................63Figure 14: Dissection of RTA holders by number of licensed employees.................................................................................71Figure 15: Direct Emissions Savings from MAC Service Measures from 2017 to 2030 in Mt CO2e..........................................73Figure 16: RRA destruction volumes in kilograms from 2003 to current, and future projections to 2030..............................76Figure 17: Refrigeration and Air Conditioning End-of-life Business as Usual Scenario with refrigerant projections of EOL,

technically recoverable, destruction and recoverable emitted to atmosphere or reused in Mt CO2e............................78Figure 18: Refrigeration and Air Conditioning End-of-life characteristics with refrigerant projections for EOL and emission

savings due to enhanced compliance recovering 40% recoverable emitted to atmosphere or reused in Mt CO2e........79Figure 19: Number of ELVs by refrigerant type in Australia from 2013 to 2030.....................................................................80Figure 20: Summary of discharges reported by type of agent from 2006 to current..............................................................83Figure 21: Summary of discharges reported by application from 2006 to current.................................................................84Figure 22: Estimate of FM-200® / FE-227TM standing bank in kilograms.................................................................................86Figure 23: Estimate of FM-200® / FE-227TM consumption from introduction to 2030 in kilograms.........................................87Figure 24: Predicted new sales mix for major classes for BAU and No Measures.................................................................108Figure 25: Predicted new sales mix for major classes for BAU and GWP Threshold Measures.............................................113

List of TablesTable 1: Impact of the Act - Summary of the estimated direct and indirect emissions avoided from 2003 to 2030 in Mt CO2e

as compared to a No Measures scenario......................................................................................................................17Table 2: Summary of the estimated direct and indirect emissions savings from 2017 to 2030 in Mt CO2e............................19Table 3: Summary of the emission abatement in the context of Kyoto and Montreal Protocols from 2003 to 2030 in Mt CO2e

and ODP tonnes for existing and new measures...........................................................................................................20Table 4: Characteristics of major equipment categories used in the EUCE model..................................................................27Table 5: Characteristics of the regulatory and market environment......................................................................................41Table 6: Summary of Technology Opportunities for New Equipment by GWP Threshold.......................................................56Table 7: Annual leak rates and emission savings by major equipment class in 2013, and 2030 BAU versus 2030 with Leak

Reduction strategy........................................................................................................................................................62Table 8: Summary of the leak inspection and detection requirements, number of devices in 2017 and emission saving in Mt

CO2e by equipment type...............................................................................................................................................64Table 9: Summary of the estimated direct and indirect emissions savings from routine maintenance in Mt CO2e................65Table 10: Split of Large RTAs and RHLs by Sector...................................................................................................................71Table 11: Estimated consumption by substance in 2013 and ODS/GWP properties...............................................................83Table 12: Summary of the estimated emissions avoided from 2003 to 2030 in Mt CO2e as compared to a No Measures

scenario........................................................................................................................................................................85Table 13: Additional FP Emissions compared to BAU: No Measures Scenario........................................................................88

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Table 14: Emissions Abatement from FP: New Measures Scenario........................................................................................90Table 15: Handling and discharge assumptions for modelled scenarios................................................................................91Table 16: Summary of the direct emissions by measures for 2003 to 2013; 2014 to 2020 and 2021 to 2030 in Mt CO2e......98Table 17: Summary of the indirect emissions by measures for 2003 to 2013; 2014 to 2020 and 2021 to 2030 in Mt CO2e.. .99Table 18: GWP Threshold timetable modelled for each major equipment class...................................................................100Table 19: Leak rates for Business as Usual scenario: 2003 to 2013......................................................................................101Table 20: Leak rates for Business as Usual scenario: 2014 to 2030 and rates of improvement............................................102Table 21: Leak rates for No Measures scenario: 2003 to 2013.............................................................................................103Table 22: Leak rates for No Measures scenario: 2014 to 2030 and rates of improvement...................................................104Table 23: Leak rates for Leak Detection and Maintenance measures scenarios: 2003 to 2013............................................105Table 24: Leak rates for Leak Detection and Maintenance measures scenarios: 2014 to 2030 and rates of improvement. 106Table 25: Leak rates for MAC Service measures scenario: 2003 to 2030..............................................................................107Table 26: GWP factors of main refrigerant gas species........................................................................................................123Table 27: ASHRAE Refrigerant designation and refrigerant mass composition of common blends used in Australia..........125Table 28: Refrigerant charges by common substance for CO2 thresholds............................................................................126Table 29: Leak Reduction requirements and frequency of leak checks relative to the CO2e thresholds................................127Table 30: Summary of Leak Reduction and Maintenance requirements by major equipment classes.................................127Table 31: Assumptions for indirect emission savings for leak reduction and maintenance requirements............................127Table 32: Indirect (scope 2) emission factors from consumption of purchased electricity from grid by year........................128Table 33: No Measures Energy Improvement Assumptions by Major Equipment Class.......................................................130Table 34: Technical characteristics for product categories (average charge, end-of-life factors and EOL model used).......131Table 35: EUCE Model End-of-life Outputs for Refrigeration and Air Conditioning equipment in kilograms........................134Table 36: EUCE Model End-of-life Outputs for Refrigeration and Air Conditioning equipment in Mt CO2e...........................135

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This paper has been prepared for the Australian Government, Department of the Environment, (DoE) Environment Quality Division, Ozone Protection and Synthetic Greenhouse Policy Team.

Prepared by Peter Brodribb of the Expert Group (A.C.N. 122 581 159) and Michael McCann of Thinkwell Australia Pty Ltd (A.C.N. 113 454 112).

Level 1, 181 Bay Street, Brighton, Victoria 3186

Ph: +61 3 9592 9111

Email: [email protected]

Web address: www.expertgroup.com.au

Disclaimer

This document is produced for general information only and does not represent a statement of the policy of the Commonwealth of Australia. The Commonwealth of Australia and all persons acting for the Commonwealth preparing this report accept no liability for the accuracy of or inferences from the material contained in this publication, or for any action as a result of any person’s or group’s interpretations, deductions, conclusions or actions in relying on this material.

The Expert Group and associated parties have made their best endeavours to ensure the accuracy and reliability of the data used herein, however makes no warranties as to the accuracy of data herein nor accepts any liability for any action taken or decision made based on the contents of this report.

ISBN: XX

For bibliographic purposes this report may be cited as: Assessment of environmental impacts from the Ozone Protection and Synthetic Greenhouse Gas Management Act, Peter Brodribb and Michael McCann 2014, Canberra.

© Commonwealth of Australia 2014

This work is copyright. You may download, display, print and reproduce this material in unaltered form only (retaining this notice) for your personal, non-commercial use or use within your organisation. Apart from any use as permitted under the Copyright Act 1968, all other rights are reserved. Requests and enquiries concerning reproduction and rights should be addressed to Department of the Environment, Public Affairs, GPO Box 787 Canberra ACT 2601 or email [email protected].

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GlossaryAmmonia Refrigerant Anhydrous Ammonia (R717) has excellent thermodynamic properties, making it effective as a

refrigerant, and is widely used in industrial and process refrigeration applications because of its high energy efficiency and relatively low cost. Ammonia is used less frequently in commercial refrigeration applications, such as in supermarket and food retail, freezer cases and refrigerated displays due to its toxicity, and the proximity of the general public. Ammonia is widely used in large cold storage distribution centres and a GWP of zero; therefore we have excluded this application from the refrigerant carbon chain.

Article 5 Countries Article 5 countries are developing countries (e.g. African nations; China, India and Thailand; and South American and most Middle Eastern countries) and non-Article 5 countries are developed countries (e.g. Australia; European Union members such as Germany, Denmark and United Kingdom; Japan; Canada and the United States).

Azeotrope See refrigerant glide.

Bottom-up model A method of estimation whereby the individual appliances, equipment and product categories that make up the equipment bank are estimated separately. The individual results are then aggregated to produce an estimate of the refrigerant bank by refrigerant species. In the context of this study, consumption estimates (i.e. leakage plus local manufacture plus exports) is reconciled with the top down data (i.e. bulk imports), except in 2012 where stockpiling occurred and adjustments were made to account for changes in industry behavior.

Bulk importers Companies with a licence to import bulk refrigerant take delivery of ship borne ISO containers each carrying between 10 and 18 tonnes of gas (depending on the type). These refrigerants are typically pumped into large vertical or horizontal storage tanks at the importer’s yards. The larger tanks will generally be capable of holding between 20 and 70 tonnes of gas, depending on the volumetric capacity and pressures of the refrigerant. Importers decant gas into tradeable quantities depending on purpose and market.

Cascade refrigeration system

A cascade system is made up of two separate but connected refrigeration systems, each of which has a primary refrigerant. The separate refrigerant circuits work in concert to reach the desired temperature. Cascade systems in operation today in Australia are R404A/R744 (CO2); R134a/R744 and R717 (ammonia)/R744. A cascade refrigeration system is also sometimes referred to simply as an ‘advanced refrigeration system’.

CHF1 Cold Hard Facts 1, the original refrigeration and air conditioning (RAC) study undertaken by the authors in 2007 based on 2006 data.

CHF2 Cold Hard Facts 2, an updated study of the RAC industry in Australia with an expanded brief to encompass new application/equipment classes, new and emerging refrigerants, and report on the refrigerant bank.

Chlorofluorocarbons (CFCs) Molecules containing carbon, fluorine, and chlorine. CFCs are the major ozone depleting substance phased out by the Montreal Protocol on Substances that Deplete the Ozone Layer. Many CFCs are potent greenhouse gases.

Coefficient of performance (COP)

The ratio of the heat extraction rate divided by the power consumed by the refrigeration compressor(s) and necessary ancillaries. The COP is dimensionless and is used to express the system efficiency.

Compressor A device in the air conditioning or refrigeration circuit which compresses refrigerant vapour, and circulates that refrigerant through to its phases of condensation and evaporation, in order to produce the refrigeration effect. The compressor is available in many forms such as piston, scroll, or screw.

Compressor rack The machine assembly which accommodates the main high pressure components of a refrigeration circuit in a single structure, allowing off site connection to associated pipe work and vessels.

Condensing unit Condensing units exhibit refrigerating capacities ranging typically from 1 kWr to 20 kWr, they are composed of one (or two) compressor(s), one condenser, and one receiver assembled into a ‘condensing unit’.

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CO2 refrigerant A widely used industrial refrigerant with high thermodynamic properties is suitable for process refrigeration applications, and automotive air conditioning use. In the past its high operating pressures have limited its use in small to medium commercial refrigeration applications. Technical innovation such as micro cascade systems and commercial availability of components such as compressors and other in line accessories is assisting its transition into smaller scale applications.

CO2e Carbon dioxide equivalent is a measure that quantifies different greenhouse gases in terms of the amount of carbon dioxide that would deliver the same global warming.

Cumulative distribution function

Cumulative distribution function of the normal distribution with mean (μ) and standard deviation (σ) evaluated at a point in time (year x).

Direct emissions Global warming effect arising from emissions of refrigerant, or any other ‘greenhouse gas’, from the equipment over its lifetime.

Energy Efficiency Ratio (EER)

The ratio of the cooling output (kWr) divided by the total electric energy input. The EER is dimensionless and is used to express the air conditioning system cooling efficiency.

Energy consumption per year

Energy consumption of the appliance, equipment or system per annum in kWh per year, or GWh per year for an application or equipment sector.

End-of-life equipment Domestic, commercial or industrial device reaching the end of its useful lifespan.

End- of-life (EOL) emissions End- of-life (EOL) emissions are direct emissions from ozone depleting substance (ODS) and synthetic greenhouse gases (SGG) refrigerants not recovered for destruction or reclamation.

End-of-life vehicles (Assignment definition)

Passenger and light commercial vehicles with a gross vehicle mass less than 3.5 tonnes that have been de-registered according to the State and Territory motor vehicle registration authorities (i.e. assumes a one month period of grace with renewals).

Equivalent Carbon Price (ECP)

Synthetic greenhouse gases listed under the Kyoto Protocol had an equivalent carbon price applied through the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 between July 2012 and June 2014. Gases covered were hydrofluorocarbons, perfluorocarbons (excluding gases produced from aluminium smelting) and sulfur hexafluoride, whether in bulk form or contained in equipment.

Equivalent refrigerant charge

The equivalent charge size relates to the amount of high GWP HFC that is used or will be displaced by an alternative refrigerant, not the actual charge of the lower GWP refrigerant which can be up to 30 per cent less. This also represents a worst case scenario in GWP terms. Refer refrigerant charge in glossary.

E3 Equipment Energy Efficiency Committee of the Council of Australian Governments (COAG) operating under the Ministerial Committee on Energy and administered by the Equipment and Appliance Energy Efficiency Team in the Department of Industry, Innovation, Climate Change, Science, Research and Tertiary Education.

Gas A general term used throughout this report, referring to ozone depleting substances, synthetic greenhouse gases and natural refrigerants. The term can refer to refrigerants when the substance is used as a working fluid in equipment or used in other applications.

Gas Species A gas species is defined as a refrigerant category based on its chemical family. For example CFCs, HCFCs and HFCs are all synthetic gases and are defined as different gas species. Similarly Hydrocarbon refrigerant is another gas species, and HC-600a, HC-290 and HC-436 (a blend of HC-600a and HC-290) refrigerants are all part of this family. Other gas species include anhydrous ammonia and Carbon Dioxide.

Global Warming Potential (GWP)

A relative index that enables comparison of the climate effect of various greenhouse gases (and other climate changing agents). Carbon dioxide, the greenhouse gas that causes the greatest radiative forcing because of its abundance is used as the reference gas. GWP is also defined as an index based on the radiative forcing of a pulsed injection of a unit mass of a given well mixed greenhouse gas in the present-day atmosphere, integrated over a chosen time horizon, relative to the radiative forcing of carbon dioxide over the same time horizon. The GWPs represent the combined effect of the differing atmospheric lifetimes (i.e. how long these gases remain in the atmosphere) and their relative effectiveness in absorbing outgoing thermal infrared radiation. The Kyoto Protocol is based on GWPs from pulse emissions over a 100-year time frame.

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Greenhouse Gases (GHG) The Kyoto Protocol covers emissions of the six main greenhouse gases, namely Carbon dioxide (CO2); Methane (CH4); Nitrous oxide (N2O); Hydrofluorocarbons (HFCs); Perfluorocarbons (PFCs); and Sulfur hexafluoride (SF6). The scope of this study covers the equivalent in carbon dioxide due to indirect emissions from electricity generation, and direct emissions from HFCs.

GWh Gigawatt hours is a unit of measurement for electricity use (1 watt hour x 109).

High GWP substances or refrigerants

This term is used to refer to refrigerants commonly used today with GWPs greater than 1400. This includes the widely employed HFC-404A (GWP of 3922), HFC-410A (GWP of 2088) and HFC-134a (GWP of 1430) (Also refer to definition of Reduced GWP refrigerants and Low GWP Refrigerants).This term is used to refer to substances commonly used today such as HFC-404A (GWP of 3922), HFC-410A (GWP of 2088) and HFC-134a (GWP of 1430). Whereas HFC-32 (GWP 675) and future blends with reduced GWPs are defined as reduced GWP substances as they have reduced GWP relative to those historically used by application. For example N40 (R-448A) with a GWP of 1387 is a zeotropic blend designed to serve as a replacement for HCFC-22 and HFC-404A in supermarket refrigeration retrofits or new systems is defined as a reduced GWP refrigerant versus the substances it replaces (also refer to low GWP substance definition).

Hydrocarbons (HCs) The term hydrocarbon refers to the main types and blends in use in Australia including HC-600a, HC-290 and HC-436 (a blend of HC-600a and HC-290). HC-600a is the preferred hydrocarbon refrigerant in domestic refrigeration applications as it is suited to both refrigerator and freezer applications. HC-290 is the preferred hydrocarbon option for non-domestic stationary applications as its performance characteristics are more suited to medium temperature applications (i.e. greater than zero degrees Celsius). Hydrocarbons are not currently used as an OEM refrigerant in mobile air conditioning in any production vehicles, although HC-436 is a hydrocarbon blend that is sometimes used in after market applications to replace or top up the refrigerant charge in mobile applications.

Hydrochlorofluorocarbons (HCFCs)

Chemicals that contains hydrogen, fluorine, chlorine, and carbon. They deplete the ozone layer, but have less potency compared to CFCs. Many HCFCs are potent greenhouse gases. HCFC-22 is the most common refrigerant in the Australian refrigerant bank.

Hydrofluorocarbons (HFCs) Chemicals that contain hydrogen, fluorine, and carbon. They do not deplete the ozone layer and have been used as substitutes for CFCs and HCFCs. Many HFCs are potent greenhouse gases.

Hydrofluoro-olefins (HFOs), and HFO blends

Chemicals known as hydrofluoro-olefins that contain hydrogen, fluorine, and carbon, and are described as unsaturated HFCs. They do not deplete the ozone layer and have very low GWP values. For example HFO-1234yf, with a GWP of 4 and HFO-1234ze with a GWP of 6. Refer Section 3.4 for further details.

HVAC&R Heating, Ventilating, Air Conditioning and Refrigeration

Indirect emissions Global warming effect of the CO2 emitted as the result of the generation of the electrical energy required to operate electrical equipment, sometimes also referred to as ‘energy related emissions.’

Indirect emission factor The indirect or CO2 emission factor is the mass of CO2 emitted by the power generator per kWh of electrical power supplied to the refrigeration installation taking in efficiency losses in generation and distribution.

kWr Refers to kilowatts of refrigeration capacity where as kW relates to kilowatts of electrical power.

KWh Kilowatt hour (1 watt hour x 103).

Kyoto Protocol The Kyoto Protocol sets binding emissions limits for the six greenhouse gases listed in the Protocol. The Australian Government is committed to reducing emissions of the six main greenhouse gases, which includes the synthetic greenhouse gases (SGGs) listed under the Kyoto Protocol, including hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), sulfur hexafluoride (SF6) and nitrogen trifluoride.

Lifespan Lifespan is the expected useful life of the equipment in years.

Low GWP substances or refrigerants

This term is used to refer to refrigerants with a GWP of less than or equal to 10, including the 'natural' refrigerants (CO2, Ammonia, hydrocarbons), and the newly commercial HFOs being scaled up by the major synthetic greenhouse gas manufacturers for use in all new passenger vehicles in Europe by 2017, that are also sometimes referred to as low GWP HFCs (also refer to the definitions

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for High GWP Refrigerants and Reduced GWP Refrigerants).

Low temperature refrigeration

Temperatures below 0oC that the general public would often think of as the point of ‘freezing’.

Minimum energy performance standards (MEPS)

Regulatory requirements for appliances or equipment manufactured or imported to Australia to ensure a set level of energy efficiency performance is met or exceeded. In the RAC industry MEPS typically cover appliances such as domestic refrigerators, some refrigerated display cases, and a wide range of air conditioners (excluding single duct portable, spot coolers, chillers below 350 kWr, etc.).

Montreal Protocol The Montreal Protocol on Substances that Deplete the Ozone Layer sets binding progressive phase out obligations for developed and developing countries for all the major ozone depleting substances, including CFCs, halons and less damaging transitional chemicals such as HCFCs.

Natural refrigerants Hydrocarbons (R600a, R290 and R436), ammonia (R717) and carbon dioxide (R744) are commonly referred to as natural refrigerants. The term ‘natural’ implies the origin of the fluids as they occur in nature as a result of geological and/or biological processes, unlike fluorinated substances that are synthesised chemicals. However it has to be noted that all ‘natural’ refrigerants are refined and compressed by bulk gas manufacturers via some process and transported like other commercial gases so also have an ‘energy investment’ in their creation, storage and transport.

Operating hours per year The number of hours the appliance, equipment or system operates at full input load or maximum capacity.

Ozone depleting substances (ODS)

Chemicals that deplete the ozone layer (e.g. HCFCs) and controlled under the Montreal Protocol. The Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 controls the manufacture, import and export of ozone depleting substances in Australia.

PJ Petajoule (1 Joule x 1015).

Pre-charged equipment (PCE)

Pre-charged equipment is defined as any equipment, primarily air conditioning equipment or refrigeration equipment, (including equipment fitted to a motor vehicle) that is imported containing an ODS or SGG.

RAC Refrigeration and air conditioning.

Recovery efficiency Proportion of refrigerant charge that is recovered from a system when it is decommissioned at the end of its useful working life. The Recovery/recycling factor has a value from 0 to 1.

Reduced GWP substances or refrigerants

A number of recently developed or used HFC substances with a GWP lower than those commonly used today such as HFC-32 (GWP 675) and similar blends, with GWPs less than 1400 and greater than 10, are referred to as reduced GWP refrigerants as they have significantly reduced GWP relative to those refrigerants that they are designed to replace. For example N40 (R-448A) with a GWP of 1387 is a zeotropic blend designed to serve as a replacement for HCFC-22 (GWP of 1810) and HFC-404A (GWP of 3922) in supermarket refrigeration retrofits, or in new systems (also refer to definition of High GWP Refrigerants and Low GWP Refrigerants).

Refrigerant Working fluid in the vapour compression refrigeration cycle.

Refrigerant bank The ‘bank’ of refrigerant gases is the aggregate of all compounds and substances employed as working fluids in the estimated 44 million mechanical devices using the vapour compression cycle in Australia.

Refrigerant charge The original refrigerant charge of refrigerant used as the working fluid for heat transfer inside a piece of equipment.

Refrigerant consumption The Montreal Protocol definition of consumption is bulk imports plus manufacturing minus exports. Australian has not manufactured refrigerant since 1996. Bulk refrigerant is imported and consumed largely for servicing the existing refrigerant bank of equipment, as well as charging new equipment not imported as pre-charged equipment (PCE) and in other applications including foams, fire protection, aerosols, export and other.

Refrigerant decanting into tradable quantities

There are three significant import/decanting facilities in Australia. Gas is decanted at these sites into thousands of cylinders ranging in size through 10 kg, 18 kg, 60 kg and then larger transportable tanks. Transportable tanks with a volumetric capacity of approximately 900 litres are commonly

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referred to as ‘one tonners’, and ‘half tonners’ for tanks with a 450 litres capacity. These transportable tanks can contain between 400 kg and 700 kg of product depending on the gas involved.

Refrigerant glide The difference between the saturated vapour temperature (or dew point is the temperature at which all of the refrigerant has been condensed to liquid) and the saturated liquid temperature (temperature at which a liquid refrigerant first begins to boil in the evaporator) is referred to as the temperature glide of the refrigerant.At a given pressure, single component refrigerants such as HFC-134a have zero glide and are therefore azeotropes. Refrigerant mixtures (blends) behave somewhat differently and have measurable temperature glide when they evaporate (boil) and condense at a constant pressure. HFC-507A is an azeotropic blend whereas HFC-404A is a near azeotrope.

Refrigerant leak rate or effective leak rate

The annual leak rate referred to in this report is expressed as a percentage of the initial charge per annum and is calculated as the sum of gradual leaks during normal operation plus; catastrophic losses amortised over the life of the equipment plus; losses during service and maintenance plus; gas that is lost along the supply chain. In the case of mobile air conditioning equipment, the annual leak rate takes into account losses from vehicle crashes, which are classed as catastrophic losses.

Refrigerant recovery Removal of refrigerant from a system and its storage in an external container.

Refrigerated cold food chain (RCFC)

The refrigerated cold food chain is part of the food value chain, which involves transport, storage, primary and secondary processors, distribution and retailing of chilled and frozen foods from farm gate to consumer. However, in this report domestic refrigeration and freezers are treated as a separate segment.

Remote condensing unit Condensing unit located remotely from the evaporator, typically outdoors (see condensing unit).

Remote RDC Refrigerated display cabinet (RDC) with its refrigerating machinery sited remote from the cabinet structure.

Self‐contained RDC Refrigerated display cabinet with its refrigerating machinery sited remotely from the cabinet structure.

Second Assessment Report (AR2)

Second Assessment Report of the United Nations Framework Convention on Climate Change, released in 1996. Australia’s legally binding emission obligations under the first Kyoto Protocol commitment period were calculated based on AR2.

Fourth Assessment Report (AR4)

Fourth Assessment Report of the United Nations Framework Convention on Climate Change, released in 2007. Australia’s legally binding emission obligations under the second Kyoto Protocol commitment period are calculated based on AR4.

Synthetic greenhouse gases (SGGs)

SGGs listed under the Kyoto Protocol and regulated under the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 include hydrofluorocarbons (HFCs), perfluorocarbons (PFCs) and sulfur hexafluoride (SF6).

Synthetic substances or synthetic refrigerants

HCFCs, HFCs and HFOs are commonly referred to as synthetic substances or synthetic refrigerants.

Technology segment A term used by the authors to refer to a defined set of technologies within the heating, ventilation, air conditioning and refrigeration (HVAC&R) industry sector. A segment of the broad family of technologies employed in the HVAC&R sector is defined by the application (i.e. mobile or stationary, commercial or residential) and then bounded by a range of size of the charge of working gas, although for the purpose of modeling, an average charge size for each segment has been calculated.

Truck refrigeration unit (TRU)

TRUs are refrigeration systems powered by dedicated diesel internal combustion engines designed to refrigerate fresh and frozen perishable products (mostly food but also pharmaceuticals and other materials) that are transported on semi-trailers, rigid trucks and rail cars. Fresh is typically classed as 2oC and frozen -20oC.

Walk‐in cool room A walk‐in cool room is a structure formed by an insulated enclosure of walls and ceiling, having a door through which personnel can pass and close behind them. The floor space occupied by this structure may or may not be insulated, depending on the operating temperature level.

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AbbreviationsAC Air conditioning

AR2 Second Assessment Report of the IPCC

AR4 Fourth Assessment Report of the IPCC

ABS Australian Bureau of Statistics

ANZSCO Australian and New Zealand Standard Classification of Occupations

ARC Australian Refrigeration Council

BCA Building Code of Australia

CHF Cold Hard Facts

CO2e Carbon dioxide equivalent

DCCEE Department of Climate Change and Energy Efficiency, now Department of Industry, Appliance Energy Efficiency Team (DoI)

DEWHA Department of Environment, Water, Heritage and the Arts, now Department of the Environment

DSEWPaC Department of Sustainability, Environment, Water, Population and Communities, now Department of the Environment

DoE Department of the Environment

ELV End-of-life vehicle

EOL End-of-life

EUCE End Use Control of Emissions

GHG Greenhouse Gas

GWh Gigawatt hour

HVAC&R Heating, ventilation, air conditioning, and refrigeration

IEA International Energy Agency

IPCC Intergovernmental Panel on Climate Change

kWh Kilowatt hour

kt Kilo tonnes, or thousand tonnes

LPG Liquefied petroleum gas

L Litre

MEPS Minimum energy performance standards

MAC Mobile air conditioning

MJ Megajoule

Mt Mega tonne, or million tonnes

ODS Ozone depleting substances

OEM Original Equipment Manufacturer

OHS Occupational Health and Safety

PJ Petajoule

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RAC Refrigeration and air conditioning

RCFC Refrigerated cold food chain

RHL Refrigerant handling licence

ROI Return on investment

RRA Refrigerant Reclaim Australia

RTA Refrigerant trading authorisation

SGG Synthetic greenhouse gas

TAFE Technical and Further Education

The Act Ozone Protection and Synthetic Greenhouse Gas Management Act 1989.

Tonne Metric tonne

UNFCCC United Nations Framework Convention on Climate Change

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1 Executive summaryOzone depleting substances (ODS) and synthetic greenhouse gases (SGGs) employed in refrigeration and air conditioning (RAC) equipment, and in some fire protection systems, are regulated in Australia under the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 (the Act)1.

Emissions to the atmosphere of ODS and SGGs from RAC equipment, and from the fire protection industry, result from the mix of technology employed; supply line and workplace skills and practices; and, maintenance regimes adopted by owners. All of these factors can be significantly impacted by regulatory and non-regulatory measures developed by policy makers.

Licensing requirements for the handling and management of ODS and SGGs, commenced operation under the Act in 2005 for the enterprises and the workforce that supplies, installs, maintains and decommissions equipment that use ODS and SGGs.

A numeric model of ODS and SGG consumption in the Australian economy was developed to calculate the impact of these ‘end-use’ licensing controls on emissions, and to forecast the impact of potential new end-use controls. This model is referred to as the End-Use Control of Emissions (EUCE) Model.

The main outputs of the EUCE model are:

Direct Emissions from all RAC technology and FP;

Indirect Emissions as a result of energy use by targeted (based on GWP thresholds) RAC technology owned by commercial enterprises;

The Bank of working gas;

Sales Mix of new equipment by refrigerant type; and,

End-of-Life Emissions from the entire stock of equipment.

The EUCE Model calculates that end-use licensing controls in Australia avoided the equivalent of 24.7 Mt 2 of CO2 (16.7ODS / 8.0SGG)3 emissions between 2003 and 2013, as a result of reducing leaks of ODS and SGGs. These controls are projected to avoid a further 59.3 Mt CO2e (18.0ODS / 41.3SGG) of direct emissions of ODS and SGGs in the period from 2014 to 2030.

Over the entire period modelled, 2003 to 2030, direct emissions avoided are calculated as being more than 84 Mt CO2e (34.8ODS / 49.2SGG) as a result of the end-use licensing introduced under the Act (BAU), as compared to a scenario in which these controls were not put in place (No Measures scenario).

It can be reasonably concluded that controls introduced under the Act have also produced significant gains in energy efficiency in some of the hardest working classes of RAC equipment. Energy efficiency improvements are delivered as a result of equipment running for longer hours on optimal working charges of refrigerant.

1 The Act implements Australia’s commitment to the international community under two separate international treaties, the Montreal Protocol and the Kyoto Protocol. Under the Montreal Protocol Australia committed to the phase out of ODS, under the Kyoto Protocol Australia committed to targets for the reduction of greenhouse gases, including SGGs that are listed in the Kyoto Protocol as ‘industrial gases’. 2 In many places throughout this report emissions of gases that are subject to the Act are calculated and reported as emissions equivalent to a number of mega tonnes of CO2. A mega tonne of CO2 is a million tonnes of CO2. A mega tonne of CO2 is a significant quantity of emissions. As an indication of the scale of a mega tonne of CO2, for the past decade Australia’s total annual CO2 emissions has ranged from around 550 to 620 Mt CO2. The Australian Government has a target to lower its emissions to five per cent below 2000 levels by 2020.3 Where an output from the model is cited, either in terms of metric tonnes of gases or as the equivalent tonnes of CO 2, it is then followed by two numbers, in brackets, with superscript of ODS and SGG following to identify the proportion of each stream of emissions that comprise the aggregate number i.e. XX Mt CO2e (YYODS / ZZSGG).

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Improvements in energy efficiency are calculated to have delivered indirect emissions reductions, because of reduced electricity use, of at least 3.6 Mt CO2 between 2003 and 2013, and are projected to avoid a further 7 Mt CO2 between 2014 and 2030. These improvements in energy efficiency will have delivered equipment owners with hundreds of millions of dollars of energy cost savings.

These conclusions of the EUCE Model are explored in more detail below.

Summary of Emissions Abatement 2003 – 2013

The EUCE Model calculates that the introduction of end-use licensing controls and trading authorisations, in a process starting in 2003, has avoided direct emissions between 2003 and 2013 equivalent to 24.7 Mt of CO 2

(16.7ODS / 8.0SGG).4

This emissions abatement is equal to 22.8% of the 108 Mt CO2e of ODS and SGGs that it is estimated was emitted between 2003 and 2013 under a BAU scenario. In other words, without the existing licensing controls being in place for the last decade, direct emissions of ODS and SGGs from RAC equipment and fire protection systems would have been at least 22% greater than they have been. Significant sources of direct emissions avoided include:

Reductions in handling losses and leaks from all classes of RAC equipment avoided 19.37 Mt CO 2e (14.01ODS / 5.36SGG);

The continuation of Refrigerant Reclaim Australia’s industry stewardship scheme and its expansion to SGGs avoided 3.28 Mt CO2e (2.14ODS / 1.14SGG);

The banning of disposable cylinders and a delayed move by wholesalers to centralised decanting of bulk ODS and SGGs avoided 1.69 Mt CO2e (0.55ODS / 1.14SGG); and,

Reductions in handling losses and leaks from special hazard of fire protection systems as a result of the Act produced a reduction in emissions, avoiding 0.33 Mt CO2e (0.001ODS / 0.33SGG). Theses estimates exclude the ODS and CO2e emissions avoided due to the operation of the National Halon Bank (NHB) and associated end-use licensing controls equating to around 10,225 ODP tonnes and 7 Mt CO2e recovered for disposal.5

Increases in recovery of ODS and SGGs from end-of-life equipment, including both stationary equipment and vehicles, following introduction of the end-use controls, are represented in the material returned to the RRA for destruction. ODS and SGGs recovered for re-use are not counted as contributing to reductions in direct emissions.6

The largest pools of avoided direct emissions between 2003 and 2013 were from:

Stationary Air Conditioning equipment – 6,585 tonnes of avoided leaks of ODS and SGG equivalent to 11.4 Mt CO2e (13.68ODS / -2.24SGG). The vast majority of this abatement (5,670 tonnes ODS and SGGs equivalent to 9.93 Mt of CO2e (12.64ODS / -2.71SGG) was achieved in the Medium AC class of split and light commercial air conditioning systems. The net abatement in this application for this period was all ODS.7

4 Calculated using AR4 GWP-100 values.5 Halon was the primary fire suppressant employed in special hazard systems for at least three decades, from the 1970s through to the mid-1980s. The NHB and management of halons as a controlled substance significantly predates the introduction of end-use licensing controls and therefore was not included in the modelling of the impact of the Act. The NHB and the estimated emissions avoided are discussed later in this report in Section 8.2.4.6 This is partly due to the lack of sound data on the volumes of refrigerant currently being re-used in the economy.7 Under the No Measures scenario the model assumes a delay in the introduction of HFC-410A due to the need for improved skills and specialised tooling required to handle the higher pressures and the associated risks. Thus the delay in the transition from HCFC-22 to HFC-410A has the effect of increasing the volume of HCFC-22 consumption, and reducing the consumption of HFC-410A over this period, delivering a "net increase" in total volume of thermal media employed in the cooling task.

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Mobile Air Conditioning equipment – 1,805 tonnes of avoided leaks of ODS and SGG equivalent to 2.5 Mt CO2e (0.01ODS / 2.49SGG). The vast majority of this abatement was 1,760 tonnes of SGG equivalent to 2.43 Mt of CO2e) achieved in passenger and light commercial vehicles.

Commercial refrigeration – 1,344 tonnes of avoided leaks of ODS and SGG equivalent to 5.3 Mt CO 2e (0.33ODS / 5.02SGG). The vast majority of this abatement - 888 tonnes ODS and SGGs equivalent to 2.8 Mt of CO2e (0.31ODS / 2.46SGG) - is achieved in remote condensing units.

Reducing leaks from RAC systems during the last decade will also have produced reductions in energy use in that equipment, due to longer hours of operation with optimal refrigerant charges, improving the thermal efficiency of the energy services provided.

The EUCE Model calculates that these efficiency improvements between 2003 and 2013 would have reduced energy related emissions by at least 3.6 Mt CO2, avoiding the use of some 3,547 GWh of electricity - delivering valuable energy cost savings to equipment owners over the past decade worth more than $354 million.8

Summary of Projected Emissions Abatement 2014 – 2030

The EUCE Model projects that end-use licensing controls and trading authorisations currently in place will avoid total direct emissions, over the projection period from 2014 to 2030, equivalent to 59.3 Mt CO 2 (18.0ODS / 41.3SGG).

This emissions abatement is equal to more than 58% of the 101 Mt CO 2e estimated to be emitted in aggregate across the projection period of 2014 to 2030, under a BAU scenario. In other words, without the existing licensing controls being in place in the decade and a half ahead, the global warming impact of direct emissions of ODS and SGGs is projected to be at least 58% greater than they are presently expected to be.”

This abatement is achieved by:

Improvements in handling losses and leaks from all classes of RAC equipment - 43.62 Mt CO 2e avoided (13.80ODS / 29.82SGG);

The continuation of Refrigerant Reclaim Australia’s industry stewardship scheme - 12.74 Mt avoided (CO 2e 4.06ODS / 8.68SGG);

Decreasing but continuing abatement resulting from the early ban of disposable cylinders - 1.61 Mt CO2e avoided (0.17ODS / 1.44SGG); and,

Improvements in reducing handling losses and leaks from all classes of fire protection systems that employ SGGs - 1.31 Mt CO2e avoided (0.00ODS/ 1.31SGG), excluding the ODS and CO2e emissions avoided from halon.

Continuing energy consumption savings are projected to flow from longer periods of equipment running with optimal refrigerant charge. Indirect emissions avoided over the projection period as a result of the improved efficiency of certain classes of hard working commercial refrigeration and AC are projected to be at least 7 Mt CO2. This represents reductions in electricity consumption of at least 7,600 GWh of electricity that would cost more than a billion dollars at 15 cents per kWh as an average electricity price.

A useful benchmark against which to compare the scale of this abatement is Australia’s UNFCCC emissions reduction target. These improvements to containment of SGGs in the stock of equipment, reduction in supply line handling losses, end of life recoveries for destruction, the removal of disposable cylinders from the supply line and energy efficiency improvements, are calculated to deliver 3.3 Mt CO2e of avoided emissions in 2020. This is equivalent to 2.5% of the projected 131 Mt CO2e that Australia needs to reduce its projected BAU

8 Calculated based on the conservative assumptions of efficiency improvements across categories of equipment as set out in Table 24, and at an average commercial electricity price over the period 2003 to 2013 of just $0.10 per kWh, a period that actually saw electricity prices for most commercial customers treble to $0.15 to $0.24 per kWh for most SME business operators.

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emissions in order to lower its emissions to five per cent below 2000 levels by 2020.9 However it should be noted that some of the avoided emissions are ozone depleting substances which are not counted under the Kyoto Protocol framework.

Additional to the environmental benefits, and to the hundreds of millions of dollars of savings to businesses and individuals that the reduced losses of ODS and SGGs have already delivered, a case for improved end-use controls is difficult to ignore when the energy cost savings are included. Table 1 below provides a summary of the estimated and projected direct and indirect emissions avoided over the entire period from 2003 to 2030.

Table 1: Impact of the Act - Summary of the estimated direct and indirect emissions avoided from 2003 to 2030 in Mt CO2e as compared to a No Measures scenario.

Emissions avoided (Mt CO2e) 2003 to 2013 2014 to 2030 (1)

Direct emissions by improvement measure ODS SGG Total ODS SGG Total

Improvements in reducing handling losses and leaks from all classes of RAC equipment 14.01 5.36 19.37 13.80 29.82 43.62

The continuation of Refrigerant Reclaim Australia’s industry stewardship scheme and its expansion to SGGs 2.14 1.14 3.28 4.06 8.68 12.74

The banning of disposable cylinders and a delayed move by wholesalers to centralised decanting of bulk 0.55 1.14 1.69 0.17 1.44 1.61

Improvements in reducing handling losses and leaks from all classes of fire protection systems 0.00 0.33 0.33 0.00 1.31 1.31

Total direct emissions 16.70 7.97 24.67 18.03 41.25 59.28

Indirect emissions reductions, as a result of reduced energy use (2) 3.6 7.0

Grand totals 28.27 66.28

1. Emission estimates for the period 2014 to 2030 are projections based on the assumption that current end-use controls are maintained.

2. These estimates only include avoided emissions from electricity use by stationary RAC equipment. The primary fuels used in transport refrigeration services (road and marine) and in mobile air conditioning are liquid fuels. Cold Hard Facts 2 (DoE 2013) estimated that transport refrigeration and mobile air conditioning consumed 46.5 PJ in liquid fuels. If we assume 1% of these emissions were avoided in 2012 due to end-use controls, this equates to an additional 31.2 kt CO2e. Assuming this estimate is typical of the average saving across the 28 year period, the cumulative emissions avoided would be in the range of 0.5 to 1 Mt CO2e for the period 2003 to 2030.

3. Refer to Table 16 and Table 17 in Appendix A for a summary of the direct and indirect emissions by measures for 2003 to 2013; 2014 to 2020 and 2021 to 2030.

9 Australia’s Abatement Task and 2013 Emissions: http://www.environment.gov.au/system/files/resources/51b72a94-7c7a-48c4-887a-02c7b7d2bd4c/files/abatement-task-summary-report_1.pdf.

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http://www.environment.gov.au/system/files/resources/51b72a94-7c7a-48c4-887a-02c7b7d2bd4c/files/abatement-task-summary-report_1.pdf

http://www.environment.gov.au/system/files/resources/51b72a94-7c7a-48c4-887a-02c7b7d2bd4c/files/abatement-task-summary-report_1.pdf

Summary of Potential Additional Emissions Abatement

A range of new measures were modelled to assess the potential to avoid emissions of greenhouse gases additional to BAU projections over the period from the present to 2030. For the purpose of the modelling it was assumed that new measures would come into effect from 2017. Thus no avoided emissions are expected from new measures in 2015 and 2016. Some of the new measures showed very strong abatement over the period 2017 to 2030.

The most rewarding new measures modelled include:

A Leak Reduction strategy involving leak inspection routines and automatic leak detection on certain classes of commercial RAC equipment avoiding the equivalent of 8.5 Mt of CO2 (0.15ODS / 8.32SGG) in direct emissions as compared to BAU and delivering indirect emissions savings as a result of improved efficiency of 4.7 Mt CO2; and,

Introduction of GWP based restrictions on the use of SGGs in certain RAC applications, with the timing of the introduction roughly modelled to align with proposed restrictions on SGGs in the EU, avoiding the equivalent of 6.7 Mt of CO2 (0.00ODS / 6.70SGG) in aggregate as compared to BAU.

Because of the high degree of confidence in the EUCE Model stock data, and as these two measures are so technically focussed, these outcomes are modelled with high levels of confidence. The Leak Reduction strategy modelled delivers the majority of emissions abatement from avoided direct emissions of SGGs, because only a relatively small, and over the course of the projection period, a declining percentage of the stock of larger equipment classes to which the measure would apply, are charged with ODS.

The GWP based restrictions modelled are similarly focussed entirely on reducing the GWP of virgin refrigerant entering the stock of equipment, and as the use of virgin ODS is now effectively banned, the benefits of this measure are entirely in avoided SGG emissions.

Other measures are modelled that produce comparable abatement, but with lower levels of confidence, because the measures must include assumptions regarding market place and workforce behaviour, such as improvements in technical skills and refrigerant handling practices, and industry wide rates of compliance with preventative maintenance regimes.

For instance substantial energy savings have been demonstrated repeatedly in case studies as a result of routine maintenance and cleaning of medium and large commercial RAC systems. Across the entire stock of equipment significant additional abatement is reasonably expected to be able to be captured, particularly in the area of indirect emissions, as a result of introducing equipment and maintenance log books, and requiring simple maintenance practices on certain classes of commercial refrigeration and AC equipment. The model has to assume levels of compliance with such regimes based on experience of the authors in the field, and their understanding of the market forces at play.

Proposed maintenance practices would be consistent with ISO 5149-4: 2014 Refrigerating systems and heat pumps -- Safety and environmental requirements -- Part 4: Operation, maintenance, repair and recovery, and include, as examples of highly effective and simple preventative maintenance program elements:

Regular inspection and cleaning of air filters, or replacement if required;

Regular inspection and clearing of the surfaces of condensers, evaporators, fans blades and fan guards;

Improved containment practices on equipment connections, hoses, pipes and accessories;

Regular inspection and repairs improving vapour sealing of cool rooms by replacing door gaskets and sealing of insulation to minimise ambient air/moisture ingress to the refrigerated space.

Based on a range of assumptions for energy efficiency gains on certain classes of commercial equipment, it is expected that a skilfully implemented comprehensive maintenance program, built around ISO 5149-4, could, on its own, avoid as much as 38.1 Mt CO2 of energy related emissions, while also delivering billions of dollars in

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energy cost savings, and providing community wide benefits in reduced electricity demand and lower peak loads on constrained electricity transmission and distribution grid infrastructure.

The supply line for HFC-134a into the more than 15 million mobile air conditioning (MAC) units also presents opportunities for reduction in direct emissions. While data on the equipment in this application, and its general performance and physical leak rates, are quite well understood, the total effective leak rate from the bank in mobile equipment is calculated as being at least equivalent to 1.4 tonnes of CO 2 in 2013. A significant portion of this is from handling losses in the supply line, and most likely at the point of service. As such, modelling reasonable assumptions about changes in workforce behaviour and improvements in handling practices shows potential reductions in direct emissions from this segment equivalent to approximately 0.2 Mt CO2 per annum equating to cumulative savings of 3.0 Mt CO2 from 2017 to 2030.

While the recovery of residual refrigerant from end-of-life equipment can be modelled into the future, at this point no significant improvement in recovery rates is expected that did not involve some form of product stewardship scheme. Such appliance, equipment and vehicle product stewardship schemes are beyond the authority of the Act. The volume of the pool of residual refrigerants expected in end-of-life equipment over the modelled period is discussed in Section 8.

Table 2: Summary of the estimated direct and indirect emissions savings from 2017 to 2030 in Mt CO2e.

Potential emission savings (Mt CO2e) Direct Indirect Total

Improvement measure (1) ODS SGG Total

Leak Reduction strategy involving leak inspection routines and automatic leak detection on certain classes of commercial equipment

0.15 8.32 8.47 4.7 13.2

GWP based restrictions on the use of SGGs in certain applications (as set out in Table 18 on page 100) - 6.77 6.77 - 6.8

Maintenance activities (2) 0.15 8.32 8.47 38.1 46.6

Improved Handling Practices with Mobile Air Conditioning Service - 3.01 3.01 - 3.0

1. Abatement is calculated as commencing from 2017, which was nominated as the earliest potential date for implementation of improvement measures.

2. Modelling of emissions abatement resulting from a mandatory maintenance regime assumes the same level of improved containment achieved under the Leak Reduction strategy, as such, in combination with the Leak Reduction strategy. Maintenance activities include a comprehensive Leak Reduction strategy as well as other activities to improve the efficiency of the equipment that would deliver indirect emissions.

Emissions Abatement in the context of Kyoto and Montreal commitments

Australia reports consumption of ODS and emissions of SGGs to the Montreal Protocol and the Kyoto Protocol respectively.

The Montreal Protocol, established in 1987, was designed to limit and eventually to stop consumption of ODS and thereby emissions to the atmosphere. The Kyoto Protocol, established in 1997, was designed to reduce emissions of greenhouse gases to the atmosphere, including of the SGGs that now form the larger portion of the bank of working gas in RAC and FP systems in Australia.

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The EUCE model has produced estimates of the impact of the Act on reducing emissions of all synthetic refrigerant gases and fire suppressants, which can then be separated into ODS and SGGs as set out in the following table.

Table 3: Summary of the emission abatement in the context of Kyoto and Montreal Protocols from 2003 to 2030 in Mt CO2e and ODP tonnes for existing and new measures.

Act measures (1)

Kyoto Protocol Montreal Protocol

Direct emissions (Mt CO2e)

Indirect emissions (Mt CO2)

ODP (t)Direct

Emissions (Mt CO2e)

Existing RAC measures (2)

2003 to 2013 5.4 3.6 425.8 (3) 14.0

2014 to 2030 29.9 7.0 419.4 13.8

Total period 35.2 10.6 (4) 845.3 27.8

Existing FP measures

2003 to 2013 0.33 - - -

2014 to 2030 1.31 - - -

Total period 1.64 - - -

New Measures: 2017 to 2030

Leak Reduction strategy 8.3 4.7 0.5 0.15

GWP based restrictions on the use of SGGs (5) 6.7 - - -

Maintenance activities (7) 8.3 38.1 0.5 0.15

Improved Handling Practices with Mobile Air Conditioning Service 3.0 - - -

1. The above estimates are based on the business as usual base case scenario. The definitions of base, mid and high case scenarios are provided in the Appendices and estimates for less conservative scenarios are provided throughout the body of the report.

2. The above estimates of BAU emissions abatement delivered by existing measures exclude avoided emissions that result from: The continuation of Refrigerant Reclaim Australia’s industry stewardship scheme; Banning of disposable cylinders and a delayed move by wholesalers to centralised decanting of bulk imported

gases; and, Petrol and diesel emissions used by transport refrigeration and mobile air conditioning.The abatement from these actions is listed in Table 1.

3. Ozone Depleting (ODP) tonnes is calculated by multiplying the metric tonnes of HCFC substances avoided by the ODP multiplier (e.g. HCFC-22 = 0.055). Australia's cumulative ODP cap for the period 2003 to 2013 was 1,140 ODP tonnes.

4. The base case scenario for indirect emissions avoided due to improvements in leaks from all classes of RAC equipment for the entire period modelled, 2003 to 2030, is 10.6 Mt CO2e, whereas the mid case is 26.7 Mt CO2e and the high case 37.3 Mt CO2e for the same period.

5. The GWP based restrictions on the use of SGGs apply only to certain applications (as set out in Table 6).6. The Leak Reduction strategy involves leak inspection routines and automatic leak detection on certain classes of

commercial equipment. The base case scenario for the indirect emissions avoided due to the Leak Reduction strategy

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for the period 2017 to 2030 is 4.7 Mt CO2e, whereas the mid case is 8.8 Mt CO2e and the high case 14.2 Mt CO2e for the same period.

7. Maintenance activities include a comprehensive Leak Reduction strategy as well as other activities to improve the efficiency of the equipment. The base case scenario for the indirect emissions avoided due to the Maintenance activities for the period 2017 to 2030 is 38.1 Mt CO2e, whereas the mid case is 49.9 Mt CO2e and the high case 61.63 Mt CO2e for the same period.

Workforce and Supply Chain Licensing the Key to Delivering Abatement

The most important outcome of the end-use licensing scheme in delivering abatement and improved energy efficiency has been the identification of, engagement with, and training of a skilled and highly technical workforce, supplied by an informed and motivated supply chain.

The administration and delivery of competency based licensing under the Act has defined a significant technical workforce that has directly benefited from the distinction provided by the ‘certification’ of their skills. The skills and practices of this workforce has also been the single most important influence on reducing direct and indirect emissions across the stock of RAC and MAC equipment in the economy.10

Prior to the establishment of Australian Refrigeration Council (ARC), entry to this industry was available via trade training and VET courses provided through TAFE and apprenticeship schemes. However the competency based workplace licensing scheme allowed skilled tradespeople, who may have acquired all of their skills in the field, to apply for and be granted a licence to work with ODS and SGGs, and some of the many classes of equipment dependent on these substances, without having necessarily entered the industry through a traditional apprenticeship training path.

As a result, in less than 10 years, this national licensing scheme has issued more than 57,000 licences to skilled personnel, while establishing an effective benchmark in the workplace for technical competency.

This had a dual effect of both ensuring a minimum competency, while also creating an industrial identity, a class of technician who ‘owned’ the technology in the workplace, whose livelihood was in part defined by a set of skills not possessed by the broader workforce. This ‘ticketed’ workforce, reinforced by public education and marketing campaigns about the need to use licensed technicians, established a barrier to entry to unskilled workers. Prior to the advent of end-use licensing it was common to find unskilled workers for instance, attempting ‘dodgy installs’ of smaller air conditioning equipment, or attempting a quick fix repair of a MAC.

These practices were quite common prior to the introduction of licensing when almost any builder, electrician, plumber or motor mechanic may have occasionally found themselves in a situation where additional income was available to deal with RAC or MAC equipment.

Importantly, for licensed technicians to earn and maintain their licence, they must both know how to use, and carry with them specialised tools for the handling and containment of ODS and SGGs - a refrigerant leak detector and recovery machine. The simple proliferation of these tools in the workplace, combined with a ban imposed under the Act on topping up a refrigerant charge without first repairing any leaks, are responsible for significant improved containment, and the delivery of waste gas into the RRA reverse supply chain to ensure destruction of waste ODS and SGG.

Additionally the ARC has issued more than 17,000 refrigerant trading authorisations (RTAs) to enterprises in the supply line for ODS and SGGs. Like the licensed workforce, these enterprises derive at least a part of their revenue from handling these gases, and thus have a clear and vested economic interest in maintaining those rights. At the same time as excluding competitors unable to meet the minimum standards to secure an authority, the RTAs establish minimum codes of practice and equipment required for handling gases, directly reducing sloppy handling practices and thus losses to atmosphere.

10 Stationary RAC equipment for instance is the single largest class of electricity consuming equipment in the Australian economy, estimated to consume more than 22% of all ‘sent-out’ electricity in Australia in 2013.

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It would be reasonable to expect that if the licensing scheme were removed, the effect of the decade of investment in improving recognition for the skill set, and establishing benchmark competencies and minimum standard tool sets, would continue to deliver improved ODS and SGG containment for at least a short period.

However the absence of licensing requirements would immediately remove barriers to unskilled participants in the industry. Inevitably this would result in larger portions of the stock of equipment being installed and attended to by less skilled service people. A flood of unlicensed service providers into the sector would change the market dynamics with new entrants bidding lower prices into competitive markets, driving the industry into a race to the bottom for pricing their services, resulting in a reversal of the trend to higher standards established by the instruments of the Act. Unlicensed service providers driving pricing down and delivering reduced standards of care and attention would add long term costs to equipment owners including lost gas, increased energy use, and shorter equipment life as a minimum - without even considering the potential for business disruptions as a result of equipment breakdown, stock losses and costs of increased electricity demand that faulty and less reliable RAC equipment can cause.

As earnings and margins erode in the industry as a result of competition of unskilled entrants, many better skilled participants are likely to focus on market niches and even new industries where technical skills earn better returns. As the industry deskills, its capacity to quickly adopt and deploy new generations of technology will fall, increasing the risk for companies wishing to introduce new technologies into the market place, slowing the deployment of new generations of RAC equipment, many of which operate at higher pressures, exacerbating the effect of leaks.

New Tickets for New Skills Should Accelerate Abatement

On the basis of the significant emissions abatement achieved in the first decade since the introduction of end-use licensing, it would be reasonable to expect that the addition of certification of specialist skills in the RAC and FP industry could reinforce the trend to improved containment and better management of ODS and SGGs.

For instance certain sections of the workforce have the capacity to deliver much larger abatement per capita than others, due to the type of equipment they routinely deal with, and their level of skills and experience. This is particularly the case for technicians and engineers who design, specify, install, commission and maintain commercial air conditioning and chillers, and remote condensing units in commercial refrigeration and supermarkets.

These categories of equipment make up only a small proportion of the total stock of equipment, but due to their size, the cooling demand they supply and their generally long hours of operation, they employ a larger portion of the bank of gas and produce more direct and of indirect emissions than the smaller and residential classes of equipment. Additional competency based certificates too both improve skills and market place recognition, that would address these harder working classes of commercial equipment could, for instance, be based on refrigerating capacity.

A number of other competency based certifications would assist parts of the workforce achieve greater recognition and reward for their skills, and would also dovetail with measures to ensure better information management in some key equipment categories.

Possible competency certificates that directly support the most rewarding potential new measures could be, for example:

Leak detection, analysis and repair module;

Refrigerant testing and identification module;

New refrigerants handling module; and,

Data management and log book establishment and maintenance module.

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Similarly a requirement for a minimum commitment to annual continuing professional development training hours to maintain licence and/or certifications would greatly assist reinforce best practice in the workforce.

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2 IntroductionDelivering cooling and refrigeration services in the Australian economy is estimated to consume more than 20%11 of all of the electricity sent out every year. The refrigeration and air conditioning (RAC) industry employs more than 170,000 people and adds an enormous amount of economic value to the cold food chain and in providing comfort conditions in workplaces and commercial buildings. This is a significant industry, creating a notable fraction of the gross domestic product. Any action that improves the overall efficiency of this industry will have positive implications for the wider Australian economy.

Like the RAC industry the fire protection (FP) industry delivers services that are not optional. Not only are fire protection systems of various sorts mandatory in most building types, but in the area of concern for this report, ‘special hazard systems’ that must use specialised fire suppression substances, the industry is protecting the telecommunications and computing infrastructure of the nation.

This cooling task, whether it is delivered by a domestic refrigerator, a vast chilled food distribution centre, or the air conditioning in a country school, and the special hazard protection systems delivered by the FP industry, rely on supplies of a range of manufactured gases many of which are regulated in Australia under the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 (the Act).

A numeric model of ODS and SGG consumption in refrigeration and air conditioning (RAC) equipment and from fire protection (FP) systems has been developed to understand the impact of end-use licensing controls on emissions of controlled gases.

The model is called the End-Use Controls Emissions Model, or EUCE Model. The EUCE Model generates a number of outputs modelled over the period 2003 to 2013, and then projections for the period from 2014 to 2030.

The EUCE Model has, as its starting point, the Expert Group RAC Stock Model, the parameters of which are set out in the Appendices.

2.1 Modelling FrameworksThe EUCE Model calculates emissions from 2003 to 2013, as they are presently understood, as a ‘BAU’ model. It then projects emissions from 2014 until 2030, under the BAU parameters, to provide an estimate of annual and aggregate emissions over the 17 year projection period under the existing regulatory regime.

The EUCE model also generates a ‘No Measures’ projection. This illustrates the potential emissions from RAC and FP that may reasonably have been expected to occur, had the existing end-use licensing arrangements not been in place. The conditions that comprise this ‘No Measures’ model are set out in Table 5 on page 41.

Two specific conditions were agreed as part of the No Measures parameters:

The continuation of use of disposable containers beyond 2003, and

The winding back of the Refrigerant Reclaim Australia (RRA) destruction program after 2003 as its original objective of dealing with ODS is progressively achieved, and its continuation as a purely voluntary program, similar to the voluntary program operating in New Zealand, rather than one supported by licence conditions as the present Australian program is.

Both of these specific conditions occupy their own worksheet in the model as stand-alone examples of significant sources of emissions that could reasonably have been expected to occur, had existing regulations not been put in place.

11 Cold Hard Facts 2, A study of the refrigeration and air conditioning industry in Australia by Expert Group for the Department of the Environment (DoE 2013).

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Finally the BAU model is used to generate estimates of changes in emissions that could be achieved given a number of New Measures. The New Measures projection produces calculations of annual and aggregate changes to emissions in the period from 2014 to 2030 in response to a number of new controls.

The conditions and parameters of these three main modelling frameworks, BAU, No Measures, and New Measures, are further explained in the relevant sections on each framework below.

2.2 Model OutputsThe main outputs from the model under each scenario are:

The Bank of working gas, by gas species and by equipment category;

Total Direct Emissions by gas species in metric tonnes from all RAC technology and FP, and total direct emissions in terms of the CO2 equivalent value of those emissions;

Indirect Emissions in Mega tonnes of CO2 as a result of energy use by RAC technology;

Sales Mix of equipment charge by equipment category; and,

End-of-life Emissions from the entire stock of equipment.

It is important to note that ‘Total Direct Emissions’ from any particular category of equipment may also be referred to in some instances as the ‘effective leak rate’. This is because total direct emissions from any class of equipment, or any piece of equipment incorporates:

Gas that leaks from equipment, either from slow leaks in operation, or as a result of ‘catastrophic’ losses when a piece of equipment suffers some sort of breakdown or failure of containment and the entire charge is lost to air;

Gas that is lost through handling losses during installation and commissioning of equipment and servicing of equipment;

Plus gas that is lost along the supply chain for the species of gas that the class of equipment requires while gas is being transported, decanted or handled.

The total of these losses comprise the ‘effective leak rate’ of which the losses from a piece of equipment during operation are only one part.

Annual consumption of bulk imports of SGGs is a proxy for the effective leak rates, after deducting;

Gas required for charging new systems at the point of commissioning (particularly commercial refrigeration and large AC equipment that is pre-charged with nitrogen until it is installed and commissioned); and

Gas consumed by OEMs during assembly of new equipment.

This is the balance of the bulk gas imports that is consumed maintaining and servicing the stock of operating equipment.

Total Direct Emissions does not include calculated end-of-life emissions, which are calculated separately (see Section 7). This is where the methodology in the EUCE model differs from the calculation of emissions of HFCs used in the Australian National Greenhouse Gas inventory (NGGI). The EUCE methodology differs from the methodology used by the NGGI in a number of ways.

Firstly the EUCE model captures changes in the stock of equipment, supply line and operating losses to air and volumes of both ODS and SGGs, (HCFCs and HFC) as its purpose is to define the effects of the Act on the environment, irrespective of the gas involved. The NGGI, which is completed annually as part of Australia’s

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commitment to reporting to its obligations under the Kyoto Protocol, is only concerned with calculating losses to air of HFCs.12

Secondly the level of confidence in the EUCE calculations of Total Direct Emissions is very high, as it reconciles very well with bulk imports and market intelligence on sales of ODS and SGGs. A number of uncertainties, particularly the level of recovery and recycling of gas from end-of-life equipment and conflicting reports in the industry regarding rates of recovery of gas from end-of-life equipment, mean that confidence in the calculation of end-of-life is lower than that for Total Direct Emissions. As a result it was determined to separate these two sources of emissions in the report and recommend further primary research be undertaken into the rates of recovery of end-of-life refrigerant from some of the main classes of equipment.

Finally, for the purpose of modelling the impact of the Act and potential new measures, it was apparent that, had Total Direct Emissions and End-of-Life emissions been aggregated into a single value, the positive effect of proposed new measures on Total Direct Emissions from the supply line and operating equipment would have been somewhat obscured by the relatively intractable problem of the pool of residual refrigerants in end-of-life equipment.

This problem is of course almost entirely economic. The vast majority of decisions to dispose of end-of-life equipment, and end-of-life vehicles, are taken by equipment owners or building owners, and can be taken without regard to the fate of the refrigerant charge. In the vast majority of the medium and smaller classes of equipment and in vehicles, there is would be a cost to an equipment owner who may decide that they had to pay for gas recovery before disposal. The cost of recovering the gas from most equipment is far greater than the value of gas recovered. So there is no economic incentive for equipment owners to pay for recovery, nor for industry participants to voluntarily recover gas. And while the metal contents of end-of-life equipment and vehicles is generally worth far more than the value of any gas that could be recovered the economics are stacked heavily against gas recovery from end-of-life equipment and vehicles.

The measure modelled in this report, focussed as they are mainly on opportunities to improve refrigerant containment and management along the supply line and in operating equipment where the economic outcomes of such measures are much more positive, are unlikely to make any impact on those economic disincentives to improved recoveries from end of life equipment.

12 National Greenhouse Gas Inventory Report 2012 (Volume 1): http://www.environment.gov.au/climate-change/greenhouse-gas-measurement/publications/national-inventory-report-2012.

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http://www.environment.gov.au/climate-change/greenhouse-gas-measurement/publications/national-inventory-report-2012

http://www.environment.gov.au/climate-change/greenhouse-gas-measurement/publications/national-inventory-report-2012

2.3 Equipment CategoriesThe EUCE Model generates outputs against the broad categories of RAC equipment listed below.

Table 4: Characteristics of major equipment categories used in the EUCE model.

Category Description Approximate Stock of Equipment

Domestic Refrigeration Domestic refrigerators and freezers, and some portables primarily operating in residential premises.

17.1 million domestic refrigerators and freezers in Australia that contain approximately 2,200 tonnes of high GWP HFCs.

Small Refrigerated Cold Food Chain (RCFC): Self-contained equipment

Stand-alone refrigeration equipment often referred to as ‘self-contained’ equipment includes plug-in-type food retail and supermarket cabinets and other small charge (<1.5 kg) refrigeration equipment with its refrigerating machinery sited inside the cabinet structure.

Around 810,000 pieces of stand-alone commercial refrigeration equipment operating in Australia of which more than 730,000 are charged with more than 900 tonnes of high GWP HFCs.

Medium RCFC: Remote condensing units

Remote condensing units typically range from 1 kWr to 20 kWr in refrigerating capacity, are composed of either one or two compressors, one condenser, and one receiver and are assembled into a ‘condensing unit’, which is typically located outdoors or ‘remote’ from the trading floor or refrigerated space.

Remote condensing units employ a bank of approximately 3,040 tonnes of high GWP HFCs in around 300,000 pieces of equipment.

Large RCFC: Supermarkets Supermarket systems are sometimes referred to as centralised systems as they are found in plant rooms in major supermarket chains and some independent operator stores.

These large hard working systems form a large portion of the final commercial step in the extensive and mission critical cold food chain, employing approximately 1,130 tonnes of high GWP refrigerants in more than 3,000 major installations.

Small Stationary AC: Self contained

Small self-contained AC primarily covers packaged room AC units (window/wall units) intended to be inserted through a hole in a wall or through a window aperture of a home, shop or worksite demountable; portable AC for domestic use and spot cooling in commercial and industrial applications.

Small AC equipment is estimated to contain close to 1,700 tonnes of high GWP refrigerant gases in more than 2.4 million appliances, although more than 1,100 tonnes of that is HCFCs.

Medium Stationary AC A broad class of equipment covering non ducted split systems including single or multiple indoor units in a variety of styles such as wall hung, cassette, console and under ceiling, as well as ducted systems; Variable refrigerant volume (VRV/VRF) split systems with multiple indoor units, and roof top packaged systems.

By far the largest group numerically, containing the largest aggregate bank of working gas with an estimated stock of around 9.4 million pieces, containing a total of approximately 23,500 tonnes of refrigerant gases.

Large Stationary AC Space chillers employed in large There are estimated to be about 28,400

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commercial buildings, mining and industry.

chillers operating in Australia, containing in total approximately 3,400 tonnes of refrigerant gases.

Small Mobile AC: Registered vehicles (excl. buses > 7 m)

Small MAC includes registered vehicles with an air conditioner such as passenger and light commercial vehicles; rigid, articulated and non-freight trucks, and mini-buses (commuter and small buses less than 7 meters in length).

It is estimated that in total there are more than 15.6 million vehicles of all types that employ small mobile AC systems.

The mobile AC bank of high GWP HFCs is estimated to be around 9,500 tonnes.

Large Mobile AC: Off-road vehicles (including buses > 7 m)

Large MAC systems are most often used in public transport such as in buses and trains, in large road freight systems such as B-Doubles and road trains, but also in unregistered vehicles including heavy equipment and off-road vehicles.

Approximately 64,000 large MAC systems are estimated to be operating employing more than 340 tonnes of high GWP working gases.

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Figures 1 and 2 provide illustrations of the dissection of service consumption and the refrigerant bank by major equipment category for 2013.

2013 service consumption by major sector (% by tonnes)

42%

36%

1%

21%

Stationary ACMobile ACDomestic refrigerationRefrigerated cold food chain

Figure 1: 2013 service consumption by major sector based on bottom-up analysis of equipment, % share by tonnes.

2013 bank by major sector (% by tonnes)

63%

21%

5%

11%

Stationary ACMobile ACDomestic refrigerationRefrigerated cold food chain

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Figure 2: 2013 bank by major sector based on bottom-up analysis of equipment, % share by tonnes.

2.4 GWPs of ODS and SGGsThis report often refers to the global warming potential (GWP) value of the various gases that are the subject of this study.

Australia’s legally binding emission obligations under the first Kyoto Protocol commitment period were calculated based on the GWP values published in the Second Assessment Report (AR2) of the International Panel on Climate Change (IPCC) released in 1996. Therefore Australian legislation also cites GWPs from AR2.

However revised GWP values were reported in the Fourth Assessment Report (AR4) in 2007. The 2nd Kyoto Protocol commitment period is based on AR4 values and Australia will adopt these values from 2015.13

This report uses one hundred year GWP values from the Fourth Assessment Report (AR4 GWP-100), in line with decisions made under the UNFCCC. A new class of substances that are mentioned in this report are the very low GWP unsaturated HFCs known as hydrofluoro-olefins (HFOs) that were not available at the time of publication of AR4. As such the GWPs attributed to HFOs and HFO blends that are discussed herein are based on industry data.

Table 26 in Appendix F lists both AR2 and AR4 GWP values as a reference for readers, and details of the refrigerant mass composition of common blends used in Australia is used to calculate the GWPs of the blends from the IPCC reports is in Table 27.

The Act implements Australia’s commitment to the international community under two separate international treaties, the Montreal Protocol and the Kyoto Protocol. Under the Montreal Protocol Australia committed to the phase out of ODS, under the Kyoto Protocol Australia committed to targets for the reduction of greenhouse gas emissions, including SGGs that are listed in the Kyoto Protocol as ‘industrial gases’. In many places in this report, where an output from the model is cited it is then followed by two numbers, in brackets, with superscript of ODS and SGG following to identify the proportion of each stream of emissions that comprise the aggregate number for example “100 Mt CO2e (XXODS / YYSGG)” where XX and YY represent the value of ODS and SGG emissions respectively.

13 The IPCC 5th Assessment Report has been released however the modelling for this report was completed before the release of the 5 th

Assessment Report.

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3 BAU ModelThe business-as-usual (BAU) model is, in effect, a model of the current market and real emissions of ODS and SGGs in Australia. By definition this market incorporates all of the regulatory measures already in place under the Act aimed at reducing emissions of ODS and SGGs in Australia. Other aspects of the Act, such as the requirement for importers of bulk ODS and SGGs, and importers of pre-charged equipment, to report those imports, have provided an important source of high quality data that underpins the ability to model the real economy.

This BAU case has, as its starting point, the Expert Group RAC Stock Model (EGRS Model). This model reports and predicts consumption, leak rates, growth in the bank of ODS and SGG, and retirements from the bank of working gas, reconciled against bulk gas imports, pre-charged equipment imports, and destruction data provided by RRA.

The EGRS Model is explained further in Appendix E: Methodology however it is a living model that has been constantly updated and frequently expanded during the course of the last 7 years of research by the authors. The BAU model for this report also includes the addition of some recently developed data on fire protection; although as a new dataset that market segment is not, as yet, completely integrated into the larger interactive numeric model.

The BAU model depicts the state of the knowledge of all uses of ODS and SGGs in Australia between 2006 and 2013, and the emission levels achieved within the existing regulatory framework. It then provides projections of ODS and SGG use under the existing regulatory framework out to 2030. The model can then generate illustrations of the bank of gas that is projected to be in place in the decade ahead as in Figure 3 and Figure 4 below.

Refrigerant bank by gas species in tonnes

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GWP <10

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HFC-Mix

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HFC-410A

HFC-404A

HFC-134a

HCFC-Mix

HCFC-22

Re

frig

era

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ba

nk

(to

nn

es)

Figure 3:Refrigerant bank transition from 2013 to 2030 by gas species in tonnes based on model assumptions.

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Refrigerant bank by gas species in Mt CO2e

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HCF-134a

HCFC-123

HCFC-22

Re

frig

er

an

t b

an

k (

Mt

CO

2e

)

Figure 4: Refrigerant bank transition from 2013 to 2030 by gas species in Mt CO2-e (AR4) based on model assumptions.

The EUCE model calculates the size of the bank by multiplying well established average refrigerant charges by the numbers of devices employed in each application. It then assumes an equivalent volume of charge when a low, or reduced GWP refrigerant, displaces a high GWP refrigerant.Actual charge size for some of the lower GWP refrigerants can be as much as 50 per cent smaller than the higher GWP refrigerant displaced, because some of the lower GWP refrigerants are more thermally efficient (i.e. a smaller charge is needed to transport the same amount of heat).Thus in calculating the displacement of high GWP refrigerants by the more effective lower GWP refrigerants, the EUCE model uses these ‘equivalent refrigerant charge sizes’ to calculate the volume of high GWP HFC that will be displaced by an alternative refrigerant, with the result that the absolute metric tonnes of refrigerants with GWP <1000 in the bank projections may be overstated. This is particularly the case in relation to the transition from HFC-410A to HFC-32 where medium sized air conditioners typically have refrigerant charges in the order of 30% less.An easier and more accurate way to visualise the change in the composition of the bank is with the projections of the GWP of the bank. Overall GWP falls steadily throughout the projection period, while the actual cooling task continues to expand. Some may argue that the changing composition of the bank and thus the reducing environmental liability of the aggregate GWP of the bank suggests that end-use licensing could be discontinued at a point in the future. However the scale of the energy services being delivered (i.e. what may also be thought of as the ‘national refrigeration task’, or national demand for air conditioning and refrigeration services) make the continuation of high quality services and management of the stock of equipment, and of the bank, ever more important in the context of the economic benefits those services deliver to the wider Australian economy. Overall the required refrigerant charge to deliver any cooling services is expected to decline over time as micro channel heat transfer technology and other techniques to reduce refrigerant charge mature.

There are some significant features to note regarding the bank of working gases in RAC, as illustrated in Figure3, that go to the core of the purpose and intent of the Act.

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The first feature of note is that the EUCE Model calculates that the phase out of HCFC is continuing to deliver steady declines in the bank of HCFC-22. This bank of high GWP ODS has declined from its peak of more than 13,400 tonnes in 2007, to around 9,600 tonnes in 2013. The EUCE model projects that bank of HCFC-22 will drop rapidly over the course of the next decade to less than 500 tonnes with a residual ‘tail’ persisting in long lived equipment out to the end of the projection period in 2030, at which point it is predicted that there will be a negligible amount ODS to be found in operating equipment.14

Given the potential for this considerable pool of retiring gas to be lost to air, all opportunities to increase recoveries of this material from end-of-life equipment should be reviewed.

The second feature to note about the future bank is that the quantity of high GWP SGGs in Australia is projected to continue to grow, as the stock of equipment expands using present generations of technology.

The greatest contribution to this increase is growth in the stock of small and medium AC charged with HFC-410A. This trend is predicted to peak towards the start of 2019 when the total bank stands at more than 53,000 tonnes, with HFC-410A projected to comprise more than 25,000 tonnes of that total.

The effect of the growing bank of HFCs can be seen in the similar peak of the bank, as visualised in terms of its GWP equivalent, in Figure 4.

The overall decline of the GWP impact of the bank after 2018 is predicted to flow from the introduction of new generations of low and reduced GWP substances, such as HFC-32 (GWP-675), and HFOs, in particular HFO-1234, HFO blends and other substances with a GWP less than 10 including CO 2, hydrocarbon and ammonia.

There are two substantial implications of this projection. One is the dependence of this projection on the successful introduction to the Australian economy of a range of new thermal media, and the challenges that the industry and its workforce will face in handling and deploying these new gases. This is a subject that has been previously explored by the authors in the report “HFC Consumption in Australia in 2013 and an Assessment of the Capacity of Industry to Transition to Nil and Lower GWP alternatives”, (DoE 2014a).

Another important aspect of this projection is that by 2018 the bank will have grown to be a body of some 52,000 tonnes of material with a GWP equivalent to more than 94 Mt CO2e.

The vast majority of the high GWP material is expected to retire in the course of the next two decades. The model predicts recovery for destruction rates to grow at around 5 per cent per annum compounding to 990 tonnes in 2030. However if current rates of recovery and destruction were to be maintained, at less than 500 tonnes per annum, as much as 80 per cent of that significant body of SGGs will be lost to air.

The BAU model of consumption shows the remarkable achievements of the Australian industry in both terms of the decline in absolute levels of consumption, and in the dramatic fall predicted in the GWP potential of annual consumption.

Figure 5, below, which illustrates actual and projected consumption of all ODS and SGGs in tonnes, from 2003 to 2030, reveals a substantial reduction in consumption of high GWP substances, following the peak of consumption from 2004 to 2007 at over 5,200 tonnes.

Projected refrigerant consumption by species above (tonnes) and below (Mt CO2e) (1)

14 Some industry participants have proposed that the bank of HCFC-22 is some 10% higher in 2013 than the EUCE Model predictions, which suggests actual life spans may be longer than those used in the model. Extending the equipment lifespans in the model would increase the size of the entire bank, however not change consumption it reconciles leak rates based on historical consumption.

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20032005

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HFC-410A

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HFC-134a

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HCFC-22

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Figure 5: Projected refrigerant consumption from 2013 to 2030 by gas species in tonnes and Mt CO 2e based on model assumptions.

1. The above projections also include consumption from Foams, Fire protection, aerosols and other applications.

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Imports of HCFC-22 began a concerted decline around that time as Australia worked towards meeting the commitment it had made under the Montreal Protocol for an accelerated phase out of this ODS. A major contributor to the decline in HCFC consumption was the migration of foam blowing systems to lower, or to zero GWP alternatives, and the closure of HCFC foam blowing capacity. However there were also declines in demand for HCFCs from some RAC applications as first HFC-404A and HFC-407C, and then HFC-410A, were adopted by the market in applications that would have previously used HCFC-22.

Some of the initial decline in bulk gas import was likely offset by an increase in pre-charged equipment imports, particularly in single split AC as local manufacturing of split systems experienced a rapid decline. There was an annual reduction in demand of some several hundred tonnes per annum as on-shore AC equipment manufacturers ceased production between the late 1990s and 2010. Setting this aside, there has, however, been a continuing decline in bulk imports starting in 2007, where from a peak of some 5,250 tonnes15, imports declined more than 16 per cent to less than 4,400 tonnes in 2013.

This absolute decline in all bulk imports from 2007 to the present was the result of a combination of factors, including, as already noted, the decline in HCFC-22 imports, plus an increase in the price of Fluorospar16 around that time, and the impact of the GFC on new business investment and consumer spending. However the decline continued and was further reinforced by the introduction of the equivalent carbon tax in 2012, with the impact that policy had on prices for HFCs.

It should be noted that the capacity for the industry to rapidly and constructively react to the price signal of the 2012 equivalent carbon tax, for instance to be able to rapidly increase recovery and recycling of valuable gases, and to improve leak detection and containment, would not have been as robust if it had not been for the skills and tools required under the end-use-licensing scheme established under the Act.

Improved containment and recovery for reuse of some species of gas from some equipment categories has continued post the removal of the equivalent carbon tax, delivering what appears to be an effective permanent reduction in consumption. This is particularly notable with HCFC-22 in which, while not subject to the equivalent carbon tax, the declining import quota has kept prices for HCFC-22 high (~$100 per kg), even while HFCs have effectively returned to pre-tax prices (e.g. HFC-404A reduced from ~$100 per kg under the equivalent carbon tax to $25 to $40 per kg post the tax).

Under the EUCE Model, driven by a mix of design improvements in new equipment, improved containment and increased recycling of HCFC-22, BAU imports are predicted to continue to decline slowly to around 4,100 tonnes (comprising 76 per cent high GWP, 10 per cent reduced GWP and 14 per cent GWP <10, based on equivalent refrigerant volumes17) in total in 2019. Bulk gas imports are then predicted to rise slightly to the end of the projection period at around 4,300 tonnes in 2030, still nearly 14 per cent below the historical high of 2007, and with high GWP substances 19 per cent below the historical high.

At the same time the stock of equipment that the imported gas will be required to service will have expanded at least in line with general economic growth over the period, into a total stock at least one third larger across most categories by 2030 compared to 2013.

The changing mix of the bank from 2014 to 2030, and the reduced GWP of the bank, is also reflected in the changing mix of imports shown in Figure 5 illustrating the shift to lower GWP thermal media. HFOs make up a

15 An alternative peak was estimated based on Refrigerant Reclaim Australia records comprising 4,824 tonnes in 2004 plus an additional 597 tonnes to allow for foam blowing, aerosols, solvents, fire protection and export rebates (i.e. automotive and RAC) not included in their values, equating to a total of more than 5,420 tonnes in 2004.16 Fluorospar is an essential mineral feedstock into the manufacturing process of HCFCs and HFCs. Rapidly growing demand for refrigeration and air conditioning, and for SGGs in other applications around the world during the long period of economic growth from 1997 to 2007 led to a shortage of Fluorospar, and strongly rising prices for a period.17 The EUCE Model incorporates adjustment factors for projections to compare demand for various gas species based on the work that the different thermal media can deliver. Some natural refrigerants, for instance, in some applications, can deliver the same amount of work with smaller volumes and lower energy inputs than some synthetic refrigerants that may have been used in those applications.

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larger proportion of bulk imports, particularly from 2017 onwards when HFOs or CO2 refrigerants are required as the refrigerant charge in all MACs in vehicles manufactured in Europe.

HFC-32 in classes of small AC also makes a significant contribution to the declining GWP of bulk imports. An increase in the use of natural refrigerants, off a low base, also contributes to the overall effect of lowering the GWP of bulk gas imports.

Figure 6 illustrates the modelled losses from 2003 to 2030 along the supply line and from operating equipment of Kyoto substances (i.e. SGGs) in tonnes (at top), and Mt CO2e (below). These charts illustrate the predicted substantial reduction in service demand of high GWP substances which is expected to peak at 5.7 Mt CO 2e in 2017 and 2018.

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Calculated emissions from leaks of SGGs by species above (tonnes) and below (Mt CO2e)

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Em

iss

ion

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ks

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Figure 6: Calculated refrigerant leaks of SGGs from 2013 to 2030 by gas species in tonnes and Mt CO 2e based on model stock and leak rate assumptions.

1. The above projections also include consumption from Foams, Fire protection, aerosols and other applications.2. This chart only provides calculated emissions from leaks of substances covered by the Kyoto Protocol (i.e. SGGs) and

does not provide a full picture of what goes to atmosphere (the UNFCCC definition) as it does not include end-of-life emissions nor losses of ODS from the bank and at end-of-life (HCFCs and CFCs).

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3.1 BAU Sales MixBecause the EUCE Model has detailed and robust data sets in the various equipment categories, projections of sales of equipment in each category, by charge type from 2013 to 2030 are able to be generated. The sales mix is an important output from the model as it represents the new stock moving into the stock of equipment which, over time, influences the composition of the bank, and thus the GWP of losses, and the demand for imports to service the stock of equipment.

Sales mix charts generated under BAU, No Measures, and under selected New Measures scenarios are published in Appendix C, and are referred to throughout the report whenever projected differences in future sales mixes are used as examples.

Some BAU sales mix projections are discussed in various places in later sections. However all of the BAU sales mix projections clearly illustrate one of the fundamental trends in the RAC industry, which is the rapid diversification in thermal media being employed.

The international chemical industry that manufactures SGGs, to a significant degree driven by changes to regulation in the EU and the US, has moved in the last few years to develop reduced and low GWP gases for use in smaller classes of equipment, that however employ a large proportion of the bank. This is particularly notable with the rapid rise of HFC-32 in smaller AC, and with the increase in MACs containing HFOs. The same overseas regulatory changes have accelerated the resurgence of traditional refrigerant gases (now often referred to as ‘natural’ refrigerants) with a GWP <10 such as CO2, hydrocarbon and ammonia in various applications.

The degree of diversification in thermal media that the industry and regulators must face is probably best illustrated by the projections for supermarket systems. Figure 7 below illustrates this diversification of thermal media employed in supermarkets, and the rapid move to low GWP gases that is predicted. This is a significant transformation as compared to 2003 where the new sales mix was > 90 per cent HFC-404A with a GWP of 3922.

Projected sales mix of new supermarket equipment by gas species

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HFO-1234

HC

CO2

Figure 7: Projected sales mix of new supermarket equipment from 2013 to 2030 by gas species.

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The supermarket industry is extremely dependent on efficient and reliable cooling services. Unlike almost any other sector of the market, the major supermarket chains are highly informed customers who are active in the specification, design, installation and operation of their critical RAC systems. Despite their relatively long capital time frames, this industry has the buying power and demonstrated willingness to be early adopters and innovators in the RAC market.

Because of the mission critical nature of RAC in supermarkets, and the significant fraction of investment capital that supermarkets dedicate to acquisition and operation of RAC systems, supermarkets also generally assess RAC options on a full life cycle cost basis.

As such the changing product mix projected for supermarkets is also expected to align with the commercial driver for better energy efficiencies in the performance of these systems.

These observations of the supermarket business, and their management of RAC systems, have not always been the case. A number of influences have led to the present positive conditions in the supermarket industry that, in addition to the central importance of RAC to supermarket operations mentioned above, include:

Aggressive competitive practices between the industry majors, resulting in high volume thin margin business models, making a focus on costs along the supply chain a critical business imperative;

Leading supermarket groups in Australia being public companies, sensitive to public opinion, with well developed Corporate Social Responsibility policy frameworks in place, influenced by a decade and a half of Federal and State government environmental campaigns focused on GHG emissions reductions, other waste reduction, energy efficiency, NGERs reporting requirements, etc;

Active legal compliance management systems across their businesses including compliance with the Act;

Steadily rising energy prices and, from mid 2000s, increasing prices for HCFC-22 and rising SGG prices for a period after that; and

Technology globalization and major retailer commitments to international pacts such as the “The Consumer Goods Forum” which is the pursuit of business practices for efficiency and to begin phasing-out HFC refrigerants as of 2015 and replacing them with non-HFC refrigerants (natural refrigerant alternatives).

This mix of influences and circumstances has resulted in tremendous improvements in the management of, and performance of RAC systems among the supermarket industry leaders in the last decade. Management and capital/technology planning by leading supermarkets of their RAC assets, could be seen to some extent, as a case study of the effect of a range of approaches that can be taken to achieve performance improvements across the wider industry and in specific equipment categories.

However without the implementation of the Act, as it is presently operated, it is almost certain that the extent of improved containment witnessed, and the avoided direct emissions are unlikely to have been achieved as early, as easily, and as substantially, as they have been.

As technology and practice leaders, a close working relationship with supermarkets in the decade ahead could be a tremendous asset for policy makers seeking to demonstrate the benefits of new technology, and best practice across the wider industry. A close working relationship with the supermarket industry will be particularly important to drive improvements into the significant RAC infrastructure employed in the independent supermarket chains and back along the cold food chain to the farm shed.

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4 No Measures Scenario

4.1 Modelling frameworkTo understand the effect of existing end-use controls on emissions from RAC and FP, a model of how emissions from these sectors would have developed, in the absence of controls, has been constructed.

By developing a reasonable view on how emissions from the sector would have grown since 2003, in the absence of end-use controls, we can compare results with known emissions today, to demonstrate what existing controls have achieved, and project emissions abatement that existing measures are expected to deliver in the future.

In the process of constructing the ‘No Measures Model’, a reasonable ‘No Measures Framework’ of market and regulatory conditions was designed during a workshop with policymakers and regulators. The starting point of the No Measures framework is a scenario in which the present day national RAC workforce licensing scheme, and business trading authorisations, were not established in law in 2004, nor rolled out starting from 2005.

The conditions in Table 5 below are a comprehensive list of the conditions that have had a major impact on the development of the RAC and FP industries, and the technology employed in these sectors in Australia in the course of the last 30 years.

The conditions, starting from 2003 that are highlighted in the table are the ‘changing conditions’ - the conditions that were assessed as most likely to have been different to the current situation, if the national licensing scheme had not been introduced.

While some consideration was given to the potential for all changing conditions to impact the emissions of ODS and SGGs, some of the changing conditions cannot be effectively incorporated in a numeric model. Levels of confidence and considerations in modelling changing conditions are discussed in the notes provided below the table. The leak rate and model assumptions and methodologies are listed in Appendix C: Leak rates assumptions for each scenario: B2: No Measures, and calculation methodologies in Appendix E: Methodologies.18

18The ‘effective leak rate’ of a category of equipment includes the total refrigerant losses along the supply line, from point of import, to the annual physical leaks from a class of equipment and is primarily derived by reconciling bulk gas imports with the stock of equipment by equipment category and the service demand for each imported gas species. Effective leak rates have been developed over several years and have been validated on a range of data and studies including a review of the IPCC Guidelines underpinning the leak rates used in the Australian National Greenhouse Gas Inventories from 1996 to 2006, international studies on individual classes of equipment, Australian industry intelligence, and finally the reconciliation of bulk gas imports with the stock model.

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Table 5: Characteristics of the regulatory and market environment.

Year/ Period

Event Locus Would have happened anyway (Y/N)?

Changed conditions Modelled (Y/N)?

1989 Montreal Protocol commences. Australia ratifies Protocol International Y

1993 RRA established Local Y

1994 Mobile AC switch from CFC-12 to HFC-134a, and undergoes international design review to tighten up systems

International Y

Mid 1990s Low stationary AC sales volumes of 200,000 to 250,000 pieces per annum

Local Y

1996 As part of meeting its obligations under the Montreal Protocol, Australia ceased the import of and manufacture of all CFCs on 1 January 1996, with the exception of a very small number of internationally agreed essential uses (i.e. medical, etc.)

International Y

1996 Local manufacturing of refrigerant ceases Local Y

1997 Kyoto Protocol established International Y

2000 The Goods and Services Tax came into force on 1 July 2000 Local Y

2001 National Refrigeration and Air Conditioning Council established using GGAP grant

Local Y

2003 Review of the Ozone Act result in the States agreeing that the Commonwealth would have responsibility for fluorocarbons

Local Y

Early 2000s

Local manufacturing characterised by low volume manufacturing, inflexible workplace, jobbing shops with some production lines, globalisation applying extreme competitive pressures – equipment quality issues and poor containment designs. Major OEMs include:Stationary AC (Actron Air, Email Air, Westinghouse, APAC, Alcair, Temperzone, Brivis, Pioneer, Rheem, DUX and many others)Refrigeration (Lovelocks, Kirby, Frigrite, Orford Refrigeration, FC Muller, Bitzer, Williams Refrigeration, Stoddards, Walker Celano, Albany Refrigeration and many small cabinet makers)Domestic refrigeration (Email-Electrolux, F&P)Automotive (Ford, Holden, Mitsubishi, Toyota, and trucks)OEM consumption, greater than 1,500 tonnes including foam blowing, solvents and aerosols

Local Y

Disposable cylinders banned (2003) Local N Yes (Note 1)

Commercial refrigeration dominated by HFC-404A for both low and medium temperature applications, and HCFC-22

Local Y

HFC-407C and HFC-410A introduced in commercial quantities in Australia around 2003 in PCE and local manufacturing

Local Y (Delayed by 5 years)

Yes (Note 2)

Chinese manufacturers emerge (often in JV arrangements with International Y

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international companies) - high volume split systems factories start to improve consistency and quality of stationary AC

Local refrigeration filling stations throughout the wholesale branch network (>100 stations)

Local Y

Catastrophic failures of supermarket condensers. Supermarket leak rates >20%, and other commercial refrigeration significantly worse such as Milk Vat and fishing fleet, etc.

Local Y

Mid 2000s Australian Refrigeration Council (ARC) established in 2001 with competency based licensing to follow 2003/4 (replaced voluntary program, the National Refrigeration and Air Conditioning Council Ltd (NRAC).

Local NN

(Note 3)

First developmental cascade refrigeration system commissioned by Coles in 2005 and several other natural refrigerant systems to follow over the next couple of years, with the assistance of government funding


Y (Note 4)

2007 AC sales hits 1 million pieces per annum Local Y

Codes of practice updated to reflect national licensing requirements (Part 1, Part 2 and automotive). Effectiveness occurred from this point onwards

Local N or delayed

N

End 2000s to current

High leak rates continue in commercial refrigeration along the length of the cold food chain. ‘Cheaper to let leak than do maintenance’ – this was the opinion of even major supermarket chains before 2009

Local N Y (Note 5)

Major restructure of local RAC manufacturing with most factories closing and being absorbed into other operations including Email Air, Westinghouse, Alcair in early 2000s, and APAC in 2008. All AC factories have gone offshore except Actron Air and Temperzone plus some miscellaneous activitiesBitzer, Williams Refrigeration and some small cabinet makers remain manufacturing in relatively small volumesElectrolux announced closure in 2015/6 and F&P closed in 2010Automotive manufacturing declines, Mitsubishi closes first in 2008, then Holden with all other auto manufacturing scheduled to close by 2017 (except for some truck)The result of globalisation and restructuring is a significant decline in OEM consumption

Local Y

Hydrocarbon refrigerant becoming more widely used as a retrofit option in MAC and in some RAC applications. Current volumes are estimated at 100 tonnes in 2013

Local Y (Reduced rate of

adoption)

Y (Note 6)

Uniform training requirements develop – which tend to lead to: greater recovery and destruction rates, system/equipment testing and inspecting; higher quality installation; better practices in terms of equipment use, safety, maintenance, and end-of-life decommissioning

Local N N

Increased prevalence of leak detection and recovery equipment and systems to enable appropriate maintenance (e.g. recovery units and leak detection devices as a condition of RTA/EATA licences)

Local N (Delayed

until HCFC-22

N (Note 7)

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and equivalent carbon tax

Calling up codes of practice and standards in the regulations leading to better workmanship and reduced direct and indirect emissions

Local N N

Improved professional and workforce (and community) awareness and education (including through industry magazines (e.g. Gas Bag and Cool Change)

Local N N

Natural refrigerant more accepted by general RAC community. Current volumes of ammonia ~540 tonnes already widely used in cold storage and large food processing) and carbon dioxide ~80 tonnes in 2013

Local and international

Y

Very large majority of local refrigerant filling stations decommissioned, and replaced with cylinders supplied by central filling stations. This change in industry handling practices is expected to have occurred due to commercial factors such as the capital cost of cylinder losses and expense of refrigerant losses to air


2010 RRA report more than 500 tonnes of gas including more than 260 tonnes of HCFCs was recovered and destroyed. More than 15 years since the use of CFCs in new equipment was banned, RRA also reported the destruction of more than 30 tonnes of CFCs.Would have got to 150 tonnes instead (2003), grew at compound rate of 35% per annum after that point – driven by legislation.

Local N Y (Note 8)

2010 HCFC-22 Pre-charged equipment import and manufacture banned

Local Y

2012 Daikin and other international manufacturers commence commercialisation of HFC-32 split systems, releases patented technology to the market

International Y (Delayed intro into Australia)

Y (Note 9)

2012 Equivalent Carbon Tax introduced in July 2012, and now repealed

Local Y

2012 Timetable for EU Directives start development of low GWP alternatives (i.e. natural refrigerants, HFO and HFC blends)

International Y (Delayed intro into Australia)

Y (Note 10)

Current Certain end-user types particularly small to medium enterprises undertake little or no maintenance

Local Y

Notes:

1. Refrigerants were packaged into disposable containers for use by air conditioning and refrigeration service personnel in sizes ranging from 1 to 50 lb (453 grams to 22.76 kg) capacities. The ban on disposables prevented emissions from the heel (~5% in 30 lb (13.6 kg) cylinders and ~6% in one shot 1 lb cans), as well as removing the multiple handling risks as a result of multiple cylinders needing to be connected and disconnected in the process of filling a system. The ban also avoided waste to land fill from dumping single use cylinders. Prior to this anyone could import one shot canisters for charging MAC, and other equipment (including supermarkets). The effect of the ban not being put into place in 2003 is modelled with reasonable of confidence.

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2. Even with the existing licensing framework in place at the time there were difficulties and injuries sustained in the workplace as a result of the higher pressures required for operation of new gases (i.e. HFC-410A). It is assumed in a ‘No Measures’ environment that the absence of end-use licensing controls would have resulted in less of a focus on training, and generally lower levels of technical skills in some sections of the workforce, and that this would have acted as a brake on the introduction of gas species that required more technical expertise. The rate at which these gases were introduced into the stock of equipment is well known. In a No Measures environment, it is thought that there would have been a five year delay in the introduction of these species to the stock of equipment, resulting in an increase in installations of HCFC-22 charged equipment with higher leak rates for a period. This condition has been modelled with reasonable confidence.

3. The establishment of an end-user licensing scheme operated by the Australian Refrigeration Council is the central feature and manifestation of the No Measures environment. However, on its own, it is not a factor that can easily be numerically modelled. We can assume, from experience across the sector, such as rates of pre-2003 participation in national licensing schemes and through AIRAH/CIBSE, etc., that as much as 10% of the skilled workforce would have continued to work towards best practice in their segments of the industry. However that would have meant having between possibly 5,000 and 6,000 licensed operators working in RAC in 2013 as compared to approximately 57,000. The many impacts of this changed condition are modelled through the outcomes predicted for many of the other conditions, and the higher leak rates predicted resulting from handling losses by less skilled and aware practitioners.

4. A five year delay in demonstration of CO2 cascade systems and other low GWP refrigerants in commercial refrigeration has been modelled with reasonable confidence. The result is a lower penetration of CO2 in 2013 and beyond.

5. The continuation of pre-2005 practices in large commercial refrigeration systems of leaving leaks, that were relatively expensive to find and fix, and topping up with refrigerant instead, has been modelled with a high degree of confidence. For example in 2003 the leak rates were estimated to be 25% per annum in supermarket refrigeration. This leakage rate is based on statistical information from a sample of over 160 supermarkets undertaken over 2002/3. Under a BAU Scenario leak rates have improved to 12.5% in 2013, and are predicted to improve further to around 9% in 2030 across a smaller bank. Whereas under a No Measures Scenario leak rates in 2013 were estimated to be 17.5% and achieve the 2013 leak rates by 2030 instead. Similar leak rates are modelled for commercial refrigeration applications with remote condensing units for the two scenarios.

6. Slower rates of retrofits of hydrocarbon in MACs have been modelled with a high degree of confidence.

7. If practitioners were not required to own, and be able to operate, recovery equipment and a leak detector, a worst case scenario could have seen a large proportion of the stock of equipment across many equipment categories operating with significantly higher leak rates, requiring regular top ups, operating at decreasing levels of energy efficiency as charges decline, and with minimal End-of-life recoveries. The general knowledge of these recovery systems and processes in the service work force would be low, and the exercise of any duty of care would certainly be low. The majority of maintenance and service behaviour would mostly be characterized by least cost practices at every opportunity (i.e. venting to air rather than pumping down for recovery or destruction). Most equipment with small charges, MACs and the majority of Wall Hung Split System AC for instance, would not be economical to pump down versus the cost of recovery. The effect of having this tool set widely employed is however not modelled as a stand-alone condition, but rather the overall effect of a skilled and well equipped workforce is captured in the modelling of the leak rate reduction strategies and/or as generally increased maintenance.

8. The winding back of the Refrigerant Reclaim Australia (RRA) destruction program after 2003 as its original objective of dealing with ODS is progressively achieved, and its continuation as a purely voluntary program, rather than one supported by licence conditions as the present Australian program is. The model assumes a progressive scale down of RRA from 2005 to 2011 and substitution with a less universal and less well funded voluntary program, similar to the program operating in New Zealand with an effective compliance rate of around 40% of the existing program. The compliance rate was estimated based on the effectiveness of the voluntary program in New Zealand that has been in operation since 1993, combined with scaling up from the NZ consumption to arrive at a valid comparison with the Australian industry.

9. A predicted 5 year delay in the introduction of HFC-32 medium sized AC into Australia can be modelled with reasonable confidence.

10. A predicted 5 year delay in the introduction of a range of synthetic gases with GWPs <10 into Australia in certain technology segments can be modelled with reasonable confidence. However the impact of this has not been included in the No Measures calculation.

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4.2 No Measures: Model OutputsTo be able to assess the emissions abatement that the present regulatory regime has delivered the ‘No Measures’ (NM) model generates a range of indicators of how the market may have looked in 2013, and in 2030, had regulatory measures not been put in place in 2003.

Unsurprisingly the most significant difference between the BAU model and the NM model is in the level of direct emissions projected under the NM Scenario, in both metric tonnes and in terms of the GWP value of those emissions. However the NM Scenario also produces notable differences in the composition of the bank of working gas in RAC and standing gas in FP, and thus changes to the sales mix of product coming into the Australian market.

4.2.1 No Measures: BankThe influences of regulatory measures on market behaviour are well illustrated by modelled changes to the composition of the bank of working gas.

The EUCE Model calculates a NM Bank as being identical in 2013 as the BAU Bank, in terms of total metric tonnes of gas employed, at more than 46,000 tonnes. However somewhat surprisingly the 2013 NM Bank (85.51 Mt CO2e) is slightly smaller in terms of its calculated GWP than the BAU Bank (87.54 Mt CO2e).

This somewhat unexpected result is produced by the delay that it is assumed the market would have experienced in the uptake of HFC-410A (AR4 GWP-100 of 2088) and the resulting19 increase in the bank of HCFC-22 (GWP 1810) under the No Measures Scenario.

The NM Bank of HFC-410A in 2013 is projected to be approximately 7,400 tonnes, as compared to the BAU Bank estimated today to be more than 16,700 tonnes.

On the other hand the NM Bank of HCFC-22 is projected to have grown to more than 18,900 tonnes as compared to the estimated BAU Bank of approximately 9,500 tonnes that exists today.

Coupled with slower NM growth in the use of gases with a GWP <10 (down by 120 tonnes from around 1,000 tonnes to just 880 tonnes) the GWP of the NM Bank is modelled as being approximately 2 Mt CO2e smaller in 2013 than the BAU Bank.

While this result may initially appear somewhat perverse, it is both understandable and justifiable given the original intent of the Act to meet Australia’s commitments under the Montreal Protocol, an international treaty which had the objective of phasing out ozone depleting substances (ODS).

Thus the EUCE Model predicts that, in the absence of the end-use controls instigated under the Act, Australia would have seen a more than 50% growth in the bank of the ODS, HCFC-22, while the GWP of the NM Bank of all working gases would have been approximately 2% less than where it now stands.

The effect of the Act can be shown to have reduced the ODS component of the bank by more than half, at the cost of a 2% increase in the GWP of the bank in 2013, as compared to the NM Bank. This rapid move away from the well established and widely used HCFCs that formed more than half of the working bank of gas in 2003, was greatly facilitated by the regulatory certainty that the Act provided all sectors of the RAC industry. Equipment manufacturers and importers could rely on the workforce to be licensed and competent, and the communication channels were in place to get critical messages about the new technology widely disseminated.

19 HFC-410A was aggressively marketed and actively adopted as a replacement for the potent ODS HCFC-22. Because of the lower GWP of HCFC-22 as compared to HFC-410A, the expected delay in the adoption of the new alternative gas would logically result in continued employment of HCFC-22 and a longer period in which new equipment employing HCFC-22 entered into the stock of equipment.

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The relatively small increase in the total GWP of the Bank following the rapid adoption of higher GWP alternatives to the ODS that were displaced is only a relatively temporary effect. The continuing market momentum towards lower GWP working gases reducing the overall GWP of the bank soon erode this 2013 differential. By 2017 the NM Bank and the BAU Bank are modelled as standing roughly equal at 96 Mt CO2e.

From 2017 to 2028 the position reverses steadily with the NM Bank projected to stand at a GWP of approximately 78 Mt CO2e in 2028, a differential of 19.6 Mt CO2e greater than the BAU Bank at that time.

By the end of the projection period the NM Bank has moderated slightly with the continuing growth of low GWP media employed in the bank to stand at approximately 67.9 Mt CO2e in 2030, compared to the BAU Bank at 49 Mt CO2e. This is a significant reduction in the GWP of the Bank of more than 18.9 Mt CO2e, attributable to the effect of the Act.

Importantly in terms of the original objectives of the Act20, the BAU Bank of HCFC-22 in 2025 is expected to be less than 175 tonnes, dropping to less than 5 tonnes in 2030 as the majority of equipment charged with HCFC-22 reach the end of their effective life. This compares to the projection for the NM Bank of HCFC-22 that is expected to still stand at 788 tonnes in 2025, more than four times the BAU Bank, and to have more than 11 tonnes still employed in the economy in 2030.

Transition of Bank in GWP and ODP for No Measures and BAU

20032004

20052006

20072008

20092010

20112012

20132014

20152016

20172018

20192020

20212022

20232024

20252026

20272028

20292030

0

20

40

60

80

100

120

0.0

200.0

400.0

600.0

800.0

1,000.0

1,200.0

No Measures - GWP BAU - GWP No Measures - ODP BAU - ODP

Mt

CO

2e

OD

P t

on

ne

s

Figure 8: Transition of the bank in Mt CO2e and ODP tonnes for No Measures and BAU from 2003 to 2030.

1. The No Measures and BAU GWP curves show the Mt CO2e of both SGG and ODP substances.

2. ODP tonnes calculation is a projection based on HCFC-22 with an ODP multiplier of 0.055, and ignores residual CFCs in the bank.

20 One key section of the Act that has held Australia in good stead internationally has been the objective to ‘achieve a faster and greater reduction in the levels of production and use of ODS than required under the Montreal Protocol’.

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4.2.2 No Measures: Total Direct EmissionsThe starkest contrast in the modelled environmental performance of the RAC and FP industries under a NM Scenario is in the projections of an additional 24.7 Mt of CO2e (16.7ODS / 8.0SGG) total direct emissions between 2003 and 2013.

Thus the EUCE Model calculates that the introduction of end-use licensing controls and trading authorisations, in a process starting in 2003, have been the main factors in avoided direct emissions between 2003 and 2013 equivalent to 24.7 Mt of CO2.

The differential rate of emissions between the BAU and NM Scenarios commences immediately after the start of the modelled period in 2003, reaching a peak of more than 3.7 Mt CO 2e per annum greater emissions in 2014. This high point is right as the projection shows the market standing on the cusp of introducing or expanding a number of lower GWP thermal media into major applications, particularly small and light commercial stationary AC (HFC-32) and in MAC (HFO-1234yf), as well as a greater use of natural refrigerants.

Despite manufacturers and the international market driving rapid changes to the composition of the Australian sales mixes, particularly after 2016, the differential in emissions continues throughout the projection period to end 1.18 Mt CO2e higher per annum under a NM Scenario for 2030, as compared to BAU.

The decade of emissions abatement between 2003 and 2013 is equal to approximately 22.8% of the 108 Mt CO2e of ODS and SGGs that it is estimated was emitted between 2003 and 2013 under a BAU Scenario. In other words, without the existing licensing controls being in place in the last decade, direct emissions of ODS and SGGs would have been at least 22% greater than they have been. The significant sources of direct emissions avoided as a result of the Act include:

Improvements in reducing handling losses and leaks from all classes of RAC equipment avoided 19.37 Mt CO2e (14.01ODS / 5.36SGG); and

The continuation of Refrigerant Reclaim Australia’s industry stewardship scheme and its expansion to SGGs avoided 3.28 Mt CO2e (2.14ODS / 1.14SGG).

Increases in recovery of ODS and SGGs from end-of-life equipment, including both stationary equipment and vehicles, that would certainly have occurred following introduction of the end-use controls, are represented in the material returned to the RRA for destruction. ODS and SGGs recovered for re-use are not counted as contributing to reductions in direct emissions.

The largest pools of avoided direct emissions between 2003 and 2013 were from:

Stationary Air Conditioning equipment – 6,585 tonnes of avoided leaks of ODS and SGG equivalent to 11.4 Mt CO2e (13.68ODS / -2.24SGG). The vast majority of this abatement (5,670 tonnes ODS and SGGs equivalent to 9.93 Mt of CO2e (12.64ODS / -2.71SGG) was achieved in the Medium AC class of split and light commercial air conditioning systems. The net abatement in this application for this period was all ODS.21

Mobile Air Conditioning equipment – 1,805 tonnes of avoided leaks of ODS and SGG equivalent to 2.5 Mt CO2e (0.01ODS / 2.49SGG). The vast majority of this abatement was 1,760 tonnes of SGG equivalent to 2.43 Mt of CO2e achieved in passenger and light commercial vehicles.

Commercial refrigeration – 1,344 tonnes of avoided leaks of ODS and SGG equivalent to 5.3 Mt CO 2e (0.33ODS / 5.02SGG). The vast majority of this abatement was 888 tonnes ODS and SGGs equivalent to 2.8 Mt of CO2e (0.31ODS / 2.46SGG) achieved in remote condensing units.

21 Under the No Measures scenario the model assumes a delay in the introduction of HFC-410A due to the need for improved skills and specialised tooling required to handle the higher pressures and the associated risks. Thus the delay in the transition from HCFC-22 to HFC-410A has the effect of increasing the volume of HCFC-22 consumption, and reducing the consumption of HFC-410A over this period, delivering a "net increase" in total volume of thermal media employed in the cooling task.

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4.2.3 No Measures: Emissions 2014 to 2030Applying the conditions of the NM Scenario to the future demand for, and emissions of, ODS and SGG further illustrates the impact of the Act. The EUCE Model projects that under a NM Scenario an additional 59.3 Mt CO2e (18.0ODS / 41.3SGG) of direct emissions would have been produced by the RAC and FP industries.

Therefore the EUCE Model projects that end-use licensing controls and trading authorisations currently in place will avoid total direct emissions, over the projection period from 2014 to 2030, equivalent to 59.3 Mt CO2.

This emissions abatement is equal to more than 58% of the 101 Mt CO 2e estimated to be emitted in aggregate across the projection period of 2014 to 2030, under a BAU scenario. In other words, without the existing licensing controls being in place in the decade and a half ahead, the global warming impact of direct emissions of ODS and SGGs would be at least 58% greater than they are presently expected to be.

This significant abatement is achieved by:

Improvements in handling losses and leaks from all classes of RAC equipment - 43.62 Mt CO 2e avoided (13.80ODS / 29.82SGG);

The continuation of Refrigerant Reclaim Australia’s industry stewardship scheme - 12.74 Mt avoided (CO 2e 4.06ODS / 8.68SGG);

Decreasing but continuing abatement resulting from the early ban of disposable cylinders - 1.61 Mt CO2e avoided (0.17ODS / 1.44SGG); and,

Improvements in reducing handling losses and leaks from all classes of fire protection systems that employ SGGs - 1.31 Mt CO2e avoided (0.00ODS/ 1.31SGG), excluding the ODS and CO2e emissions avoided from halon.

Over the entire projection period, 2003 to 2030, total direct emissions are calculated as being 84 Mt CO 2e (34.73ODS / 49.22SGG) greater under a NM scenario as compared to BAU.

Importantly in terms of the original objective of the Act, in a NM environment it is projected that more than 15,400 tonnes of HCFC-22 would have been emitted over the entire projection period from 2003 to 2030 as compared to BAU.

In other words, without the existing licensing controls under the Act being in place, direct emissions of ODS between 2003 and 2030, are projected to be at least 15,600 tonnes greater, equal to being 85 per cent greater than under the BAU emission scenario.

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Additional Direct Emissions for No Measures Scenario (Mt CO2e)

20032005

20072009

20112013

20152017

20192021

20232025

20272029

0.000

0.500

1.000

1.500

2.000

2.500

3.000

3.500

4.000

Foam/other

FP

MAC

AC

MAC (Mobile AC), AC (Stationary AC), RCFC (Refrigerated Cold Food Chain), and DR (Domestic Refrigeration).

Figure 9: Additional Direct Emissions for No Measures Scenario versus BAU baseline from 2003 to 2030.

4.2.4 No Measures: Disposable and Refillable CylindersOne of the assumed outcomes in the NM Scenario is that there would have been no bans placed on the sale and use of refrigerant in disposable cylinders.

For many years prior to 2003 refrigerants were packaged into disposable containers for relative ease of use by air conditioning and refrigeration service personnel. Disposable cylinders were available in sizes ranging from 1 lb (454 grams) to 50 lbs (22.68 kg) capacities, however the most common sizes are the 1 lb canisters and a 30 lb (13.6 kg) cylinder.

The NM Scenario assumes that disposables would still be available to the trade, as they have been for instance in New Zealand and the USA, where observed market behaviour can be used to understand what is likely to have occurred if a similar situation existed in Australia.

Smaller disposable cylinders were very convenient to transport and easy to use in general RAC maintenance and in servicing of MACs. This was particularly in the smaller businesses or by mobile operators where there was little need or desire to hold larger stocks of refrigerant. Further up the value chain, disposable cylinders lower the barriers to entry (i.e. no filling facilities and cylinder fleet required) into supplying the market with existing or emerging refrigerants.

There were two main problems with disposables. The first problem was mainly a function of the capacity of the smaller disposables which in many situations, unlike the larger capacity reusable cylinders now in common use, required connection and disconnection of multiple disposable cylinders to deliver sufficient charge to a device. Every connection and disconnection involves some loss of gas.

The second and larger problem is with what was known as the ‘heel’. This is the gas remaining in the cylinder that could not be released into an application because the internal pressure of the cylinder would fall to a level

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which made it impossible to use the last of the gas. The heel is calculated as ~3% in 30 lb (13.6 kg) cylinders and ~6% in 1 lb (454 gram) canisters. This heel is eventually lost to atmosphere whereas this is not the case with refillable cylinders.

Refrigerant gas wholesalers had already commenced a move to centralised decanting from large ISO containers into the now common reusable cylinders prior to the ban on disposables being put in place.22 There were several factors driving a change to centralised filling stations including:

An increased focus on Occupational, Health and Safety by wholesale businesses following several injuries caused by gas burns; blown and flying hose ends; dropped cylinders on feet and hands, and some significant injuries with 1 tonne vessels resulting in rising work cover insurance premiums;

Branch efficiency, customer service and labour cost – on hot summer days there would often be a queue at many branches with mechanics coming in to have bottles filled;

Refrigerant losses to air amounting to more than 50 tonnes per annum (taking into account refrigerant provided free of charge to contractors as part of special deals) for each major wholesaler; and,

Contractors demanding to have ‘out of test’ cylinders refilled.

This move to centralised decanting, away from the previous supply chain where decanting to reusable cylinders occurred at most wholesale outlets, was primarily to address Occupational Health and Safety concerns and the very considerable costs being incurred by wholesalers. For these reasons the model assumes that in the absence of the ban, the move to centralised decanting continues, but is delayed by five years. Because there was no particular cost advantage enjoyed by either disposables or refillables, the fight over market share would have revolved around marketing and market power.

It is assumed that eventually the few large wholesalers, who had invested in centralised decanting to reusable cylinders, would have controlled the larger part of the market and supplied it with gas in reusable cylinders. This would be typical of market evolution in Australia where a combination of a relatively small market (in a global sense), organised around a handful of capital cities separated by long distances, tends to favour national chains of a certain scale who can benefit from being direct importers, enjoy the lower unit transport costs of dealing with larger volumes, and profit from regional opportunities and market developments as they occur.

Disposables would have maintained a smaller and decreasing market share in areas of greatest convenience, for instance in the main service markets where as much as 10% of the market would still have used 30 lb (13.6 kg) disposables and 5% of the MAC service market still using 1 lb (454 gram) canisters was the basis of the assumptions. Had disposables still been available at the time of the introduction of the equivalent carbon tax, in all likelihood they would have been used to supply and assist the emergence of a completely unlicensed Do-It-Yourself market among equipment owners prepared to avoid as much of the extra cost of the tax as possible.

Disposables would still have been employed in niche markets and for special lines. For instance when wholesalers launch new product ranges they would have used disposables until they were sure the market was sustainable before investing in the infrastructure required for filling and handling reusable cylinders.

With the model constructed around these expected market developments it calculates that, had disposable cylinders continued to be available, an additional 1.69 Mt CO2e (0.55ODS / 1.14SGG) of direct emissions would have been released between 2003 and 2013. The model further projects that at least another 1.61 Mt CO2e (0.17ODS / 1.44SGG) would have been lost to air in the period 2014 to 2030 had disposables not been banned.

These calculations are relatively conservative, and actual emissions would most likely be significantly worse. However there are a range of other considerations that cannot be modelled that may well include benefits as a result of this ban, equally or even more important than the direct emissions avoided.

22 Companies with a licence to import bulk refrigerant take delivery of ship borne ISO containers each carrying between 10 and 18 tonnes of gas (depending on the type). These refrigerants are typically pumped into large vertical or horizontal storage tanks at the importer’s yards. The larger tanks will generally be capable of holding between 20 and 70 tonnes of gas, depending on the volumetric capacity and pressures of the refrigerant. Importers decant gas into tradeable quantities depending on the purpose and market.

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Prior to the ban anyone could import smaller canisters for charging MAC and stationary RAC (including supermarkets). As Australia has no production of refrigerants, all these small importers would have inevitably developed a wide range of suppliers from a number of countries. This diversity of suppliers to multiple small importers would have inevitably led to product substitution and wide product quality variations.

Examples of product substitution that can be pointed to include cases of CFCs and HCFCs being sold as HFCs as is now the case in South Africa, Russia, and parts of South East Asia.

Without the ban on disposables, the equivalent carbon tax would have had a magnifying effect on disposable imports, and increased the demand for, and import of gas species that were not subject to the tax, such as HCFCs. The ban effectively locked out many end users and contractors from the stock piling that occurred in the wholesaler network in the lead up to the introduction of the equivalent carbon tax. Pre-purchasing refillable cylinders to a specification from a cylinder manufacturer was a significant obstacle. It is reasonable to assume that, just like the nearly threefold increase in wholesale bulk imports prior to the implementation of the equivalent carbon tax, if the disposables ban had not been in place in 2012, there would have been a similar increase in import of disposables.

Another small environmental benefit from the ban on disposables was the significant avoided solid waste to land fill from the dumping of tens of thousands of single use cylinders.

Once the Australian wholesalers and gas distribution facilities established their reusable cylinder fleet for virgin refrigerant, they moved onto supplying other rental cylinders including clean pump down cylinders for recovery of refrigerant, and reclaim cylinders for safe disposal of unwanted refrigerant.

As well as the significant avoided direct emissions, the closing down of an avenue of banned substances entering the market, and the reduced land fill, eliminating this inherently wasteful product format from the market changes the attitude of the market and the end user. Disposable product is diametrically opposed to the culture required for stewardship, and the ban on disposables was an important step in establishing one of the main tenants of a culture of stewardship – the entire supply chain has to work in both directions, waste and dumping of any sort is undesirable.

4.2.5 No Measures: DestructionA significant change to the industrial landscape under the NM scenario is the assumption that the refrigerant industry stewardship program for ozone depleting substances, Refrigerant Reclaim Australia (RRA), was not extended to recover HFCs and is phased out after 2003.

In the absence of RRA the EUCE Model predicts that an additional 3.28 Mt CO2e (2.14ODS / 1.14SGG) would have been emitted between 2003 and 2013.

The NM Model projects that the absence of the RRA will result in an additional 12.74 Mt CO2e (4.06ODS / 8.68SGG) of emissions between 2014 and 2030.

While RRA is not a direct instrument of the Act, its role in the industry, and the willingness of the RRA23 members to continue the scheme and extend it to HFCs is considered to be a direct result of the changes to the Act and establishment of the end-use licensing scheme after 2003.

Refrigerant importers in Australia as part of their collaborative efforts with Australian regulators established RRA, in response to the international efforts to reduce damage to the ozone layer. Since 2003 RRA has collected

23 The Act and associated regulations require that refrigerant importers must be members of a product stewardship program if such a program exists, and further requires that RTAs must return recovered gas to an approved recovery facility. The RRA scheme or something similar would almost certainly have been continued by industry post the introduction of the Act, however the operation and structure of the scheme, including its funding base and the economics of the reverse supply chain it operates, are entirely decided and managed by a Board of industry members.

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and destroyed more than 4,000 tonnes of ODS and SGGs equivalent to approximately 7.5 Mt CO 2e. This has included more than 398 tonnes of CFC, more than 2,100 tonnes of HCFCs and 1,580 tonnes of HFCs.

In its most successful year to date (2011) more than 515 tonnes of gas, including more than 260 tonnes of HCFCs, was recovered and destroyed. At that point, more than 15 years since the import of CFCs was banned, RRA still reported the destruction of more than 30 tonnes of CFCs.

The effect of RRA not extending its stewardship program into HFCs, and instead progressively winding down from 2005 to 2011, is modelled with a high degree of confidence due to the provision of very reliable data on actual volumes of gas received and destroyed by RRA over the period.

The data collected by RRA also serves to illustrate the effect of the Act on the behaviour of the market. RRA itself estimates that in the absence of the end-use controls coming into effect its collection and destruction efforts may have levelled out between 150 tonnes and 200 tonnes per annum after 2003. However with the advent of end-use licensing controls and the creation of an offence for preventable emissions, the rate of returns grew at 35% per annum towards the peak in 2011.

The EUCE Model does not assume that recovery and destruction activity completely ceases with the winding down of RRA. Because the industrial behaviour and reverse supply chain would have been well established by RRA for the HCFC phase out anyway, it is assumed that conscientious members of the industry, either from pure altruism and/or for marketing purposes, continue to recover and destroy gas.

An example of this sort of voluntary program can be seen in the voluntary destruction program that has been operating in New Zealand (Refrigerant Recovery NZ) for the past two decades. Based on the effectiveness of the New Zealand program a generous compliance rate of around 40% of the existing RRA program is assumed in the model for a post RRA voluntary Australian program.

If the model were to assume that no effective voluntary program continued in Australia, and that voluntary destruction delivered only 5% of the present RRA program, then an additional 1.9 Mt CO 2e emissions are calculated between 2003 and 2013 bringing total additional emissions between 2003 and 2013 to 5.2 Mt CO 2e (3.39ODS / 1.81SGG), and an additional 8.73 Mt CO2e of emissions are predicted for the period 2014 to 2030 raising the projection of total additional emission for 2014 to 2030 to 20.2 Mt CO2e (6.42ODS / 13.75SGG).

However it is thought that the model constructed around a continuing voluntary program achieving 40% of the present rate of RRA recoveries is a reasonable assumption. Figure 16 in Section 7 provides an illustration of the BAU projection for recoveries to 2030.

4.2.6 No Measures: Indirect EmissionsReducing leaks from RAC systems means that the equipment enjoys longer hours of operation with optimal refrigerant charges, thus improving the thermal efficiency of the cooling services provided and improving the overall efficiency of the energy services provided.

As a result of the end-use licensing scheme introduced under the Act, a number of hard working equipment categories, that are generally maintained and serviced reasonably regularly by licensed technicians, have been modelled to calculate energy savings across the category.

The commercial refrigeration and air conditioning equipment classes included in modelling for indirect emissions are listed in detail in Table 33 in Appendix H: Indirect emissions, however collectively they provide the backbone of the cold food chain and commercial buildings, and as a result are the classes of equipment with generally the longest running hours per annum.

The EUCE Model calculates that efficiency improvements between 2003 and 2013 across these equipment categories, as a result of longer hours running on optimal charges, would have avoided the use of at least 3,547

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GWh of electricity, delivering energy cost savings to equipment owners over the past decade of more than $354 million and reduced energy related emissions by at least 3.6 Mt CO2.24

Conversely one can draw the conclusion that, had the Act not established an end-use licensing scheme that underpins the greater awareness and commitment of the technical workforce, that over the period 2003 to 2013 indirect emissions of at least 3.6 Mt CO2 would have been produced as a result of equipment running on sub-optimal charges, at lower levels of efficiency, costing equipment owners hundreds of millions of dollars for additional electricity purchases.

These calculations are inherently conservative, firstly in terms of the efficiency improvements calculated for that proportion of the equipment assumed to have optimal charges, and secondly because electromechanical efficiencies (or inefficiencies) in practice feedback on themselves.

For instance the improved efficiency of having an optimal charge means that a cooling task is completed with less electricity consumed and possibly also in a shorter time. This means that less waste heat is generated by the electromechanical equipment (which cannot ever be 100% efficient) so some of the energy is converted to heat in operation. Thus the more efficient equipment can often operate with lower ‘ambient’ heat loads, because less waste heat is produced. This assists the overall efficiency. Efficiency compounds positively.

Conversely inefficient equipment produces additional waste heat, which works against the efficiency of the thermal services being delivered.

Continuing energy consumption savings of at least 7,600 GWh are projected to flow from equipment running with optimal refrigerant charge, between 2014 to 2030, as compared to a NM Scenario. This reduction in consumption of electricity will produce cash savings of more than three quarters of a billion dollars at just 10 cents per kWh and are projected to avoid energy related emissions of at least 7 Mt CO2.

Additional to the environmental benefits, and the hundreds of millions of dollars of savings to businesses and individuals that the reduced losses of ODS and SGGs have already delivered, a case for continuing and improved end-use controls is difficult to ignore when the energy cost savings and avoided energy related emissions are included.

4.2.7 No Measures: End-of-lifeEmissions from RAC equipment and vehicles that reach the end of their useful life are not counted as part of the effective leak rate used to calculate direct emissions from the stock of equipment.

Recovery of gas from end of life (EOL) equipment and vehicles is a materially different opportunity to containing losses during operation.

It was decided early in the development of the Expert Group RAC Stock Model (EGRS Model) that aggregating end-of-life emissions into a ‘full life cycle’ effective leak rate would distort the analysis of opportunities for improved containment, and in effect conceal the scale of the end-of-life environmental liability/opportunity.

Further, because recovery and destruction of gas by RRA, in effect, includes all recoveries from end-of-life equipment, the difference between the BAU recoveries from EOL equipment, and the projected losses from EOL under a NM scenario, cannot be any greater than the actual returns to RRA. Gas that may be recovered and reused by the industry is not counted as a reduction to EOL emissions, because while that gas may reduce imports, it is still in use in the stock of equipment or in inventory, and still has the potential to be emitted.

To get a sense of the overall scale of the pool of residual gas in end-of-life equipment and vehicles, the EUCE model calculates that in 2013 there was approximately 1,320 tonnes of ODS and SGGs 25 in end-of-life

24 Calculated on the basis of an average commercial electricity price over the period 2003 to 2013 of $0.10 per kWh.25 This EOL estimate is based on RAC equipment (excluding domestic refrigeration and MAC) retirements and takes into account a factor for end of life % remaining, however does not include the technical recovery factor which provides an estimate for refrigerant that is

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refrigeration and air conditioning equipment (not including domestic refrigerators). It is estimated that MACs in end-of-life vehicles in 2013 contained approximately 187 tonnes of ODS and SGGs of which approximately 19 tonnes was recovered and destroyed. Of this total of approximately 1,500 tonnes of residual gas it is estimated that some 358 tonnes was recovered and destroyed.

Thus in 2013 it is estimated that approximately 1,140 tonnes of ODS and SGGs was emitted to air from end-of-life equipment and end-of-life vehicles. This gas had an approximate equivalent global warming potential of 2.1 Mt CO2e, as compared to the losses from working equipment in that year with a GWP of 6.7 Mt CO 2e (1.27ODS / 5.43SGG).

As such, under the existing regulatory framework, including all supply line losses, direct emissions from the bank of working gas in operating equipment, and including losses to air from the pool of residual gas in end-of-life equipment, it is calculated that total emissions of ODS and SGGs was equal to 8.8 Mt CO 2e. This total is approximately 31% higher than just the ‘effective leak rate’.

These two sources of emissions of ODS and SGG to the atmosphere are dealt with separately throughout this report as the level of confidence in the calculation of the portion of the pool of residual gases in end-of-life equipment that is actually lost to the atmosphere is not as high as the confidence with which the ‘effective leak rate’ is calculated. This is due to a significant degree of uncertainty as to the volume of gas that may be recycled for reuse from end-of-life equipment (particularly HCFC-22) and due to widely differing views in some sectors as to the proportion of this pool that is ultimately recovered.

Throughout the model period, from 2014 to 2030, it is estimated that a total of some 40,400 tonnes of ODS and SGG will be contained in RAC equipment reaching the end of its life and that under a BAU scenario some 11,400 tonnes of that will be recovered and destroyed. Under a NM Scenario recovery and destruction over the projection period is expected to be at least 60% lower with only some 4,500 tonnes recovered and destroyed resulting in additional emissions of some 12.74 Mt CO2e (4.06ODS / 8.68SGG) as set out in the section on ‘No Measures Destruction’.

More analysis of the volumes of residual refrigerant in retiring equipment and vehicles, and the scale of the opportunity for enhanced recoveries from end-of-life equipment and vehicles, is explored in Section 7: End-of-Life Equipment and Vehicles.

technically recoverable.

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5 New MeasuresThe diverse and extensive RAC and FP industries in Australia offer a range of opportunities for the introduction of possible measures that could deliver meaningful reductions in direct and indirect emissions and improve the overall environmental performance of these sectors.

Possible new measures that could be considered include:

GWP Restrictions - Imposing restrictions on thermal media employed based on the GWP of the gas species in new equipment, particularly where viable lower GWP species are available that are suitable for the task;

Leak Reduction Strategies - Best practice voluntary or mandatory leak inspection and detection regimes for certain classes of equipment;

Maintenance Strategies - Best practice voluntary or mandatory maintenance programs for certain classes of equipment;

Log Books - Establishing process and documentation systems that provide full life cycle chain of custody documentation for selected classes of equipment;

Product Stewardship - Product stewardship programs that maximize the recovery of all useful and environmentally damaging materials at end-of-life; and

Skills Expansion Strategies – Continuing professional development of the skilled workforce with addition of competency based and instructor led certificated skills modules.

While all of these measures have potential to deliver significant abatement from the sector, the initiatives that are able to be modelled with high degrees of confidence, and that deliver very large abatement relative to the total emissions from these sectors, are GWP based restrictions on thermal media and leak inspection and detection regimes accompanied with log books.

The proposed new measures that could be numerically modelled have been modelled separately. However the suite of new measures would be very complimentary to each other, delivering compounding benefits. This is particularly the case with the proposed Leak Reduction and Maintenance strategies, and the proposed equipment Log Books. Potential synergies of these measures are discussed further in the sections below.

5.1 GWP Restrictions and Sales MixThe Australian industry has already successfully transitioned through two generations of thermal media, effectively eliminating CFCs from the economy, and is on track to remove HCFCs several years in advance of the requirements of the Montreal Protocol.

A third generation of lower GWP refrigerants and fire suppressants are starting to enter the market or are on the near horizon and are starting to become available to the Australian industry. The successful commercialisation of these lower GWP media give regulators an opportunity to accelerate changes to the sales mix of new equipment and thus direct the composition of the bank of working and standing gas in the decades to come.

Using what is known about emerging and near horizon gases, a timetable for restrictions on high GWP gases by equipment category has been modelled. The timetable and GWP threshold limits proposed (as set out in Table18 on page 100) are generally consistent with the proposed EU timetable for similar restrictions, except where a threshold restriction has already commenced under the EU program. Other aspects of the timetable are discussed in the footnote.26 A simple visual has been prepared in below for major equipment class to provide a technology

26 Equipment classes that have no EU thresholds proposed are not modelled as there is further technical development required with some equipment types within the sector. Difficult applications in the fishing industry are exempted as a result of the exemption for deep freeze applications <-50oC. There are many variants and safety issues with large MAC however it is thought that 50% of large MAC technology can achieve <150, other 50% requires further development.

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signal signals (green, amber and red) to indicate the general suitability of the GWP restriction. The GWP restrictions modelled only include product classes with green signals (excluding fire protection).

Table 6: Summary of Technology Opportunities for New Equipment by GWP Threshold.

New equipmentNew equipment technical capability (GWP threshold)

150 750 1500 2500

Domestic refrigeration

Self contained

Remote

Supermarket: other Refer above

Supermarket: Cascade Systems

Small AC (1)

Medium AC

Large AC: Chillers other

Large AC: Centrifugal Chillers

Small MAC

Large MAC

Fire Protection

Key to technology signals:

Threshold suitable (but may need small number of exemptions in some sectors)

Threshold may be suitable for part of sector, but more commercial development needed

Threshold not suitable at this time

1. Small AC comprises sealed (i.e. self contained) unitary equipment, mostly window/wall units and portable units sold into domestic applications. Portable units have no MEPs requirements and have been sold into Australia with hydrocarbon charges for at least 5 years (i.e. Delonghi). Australia currently has the highest MEPS levels in the world for window/wall units and no hydrocarbon charged units are currently registered in Australia. There are several overseas suppliers that manufacture window/wall units that operate on hydrocarbons and those products that do not currently meet Australian MEPs could be re-engineered to do so.

If the entire program of restrictions, as set out in the table, were to be adopted the EUCE model predicts that this measure would avoid total emissions equivalent to 6.7 Mt CO2e SGGs over the period from 2014 to 2030.

Abatement is only calculated as commencing from 2017, which was nominated as the earliest potential date for imposition of a restriction starting in domestic refrigeration and small MAC.

These avoided emissions are in the absence of any improvements in containment, and result purely from changing the composition of the bank and thus reducing demand for higher GWP refrigerants. These changes to the bank would continue to deliver reduced emissions well into the future, and must also reduce the environmental liability of the EOL pool of refrigerants.

The improvement in avoided emissions is particularly notable in the case of emissions from MAC in passenger and light commercial vehicles, a class of equipment that is responsible for delivering 4.13 Mt CO2e SGGs (>61%) of the total projected abatement as a result of GWP based restrictions (illustrated in Figure 10).27

27 This restriction is consistent with the European Union regulations (EC Directive 2006/40/CE) that place a ban on use of refrigerants with a GWP greater than 150 in all new vehicles from 2017. Leading vehicle manufacturers, such as GM, Ford, Chrysler, Honda and

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Direct Emissions Savings from GWP Threshold Measures (Mt CO2e)

2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 20300.000

0.100

0.200

0.300

0.400

0.500

0.600

0.700

Foam/other

FP

MAC

AC

MAC (Mobile AC), AC (Stationary AC), RCFC (Refrigerated Cold Food Chain), and DR (Domestic Refrigeration).

Figure 10: Direct Emissions for Savings from GWP Restriction Measures commencing 2017 in Mt CO2e.

Given the difficulty in recovery of residual refrigerants at end-of-life from MAC, this strategy may be ultimately the most effective means of mitigating the environmental liability of the EOL pool of refrigerants in this class of equipment.

The effect of GWP based restrictions can be seen in the changes to the bank of gas working in passenger and light commercial vehicles as compared to the BAU bank. The GWP based threshold restrictions dramatically accelerates the employment of low GWP refrigerants, reducing the bank of HFC-134a in 2030 by more than 2,500 tonnes.

others endorsed the use of HFO-1234yf in mobile AC for industrial gas manufacturers to commit to large scale production facilities, and several German manufacturers working on CO2 or a production mix of these low GWP alternatives. In May 2010, DuPont and Honeywell announced a manufacturing joint venture in China to produce HFO-1234yf. Daikin-Arkema also announced its intention to produce HFO-1234yf on an industrial scale in Europe to meet the time frame for the automotive industry established under European Directive (EC Directive 2006/40/CE).

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Small MAC Bank BAU and GWP Threshold Measures (tonnes)

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 20300

2,000,000

4,000,000

6,000,000

8,000,000

10,000,000

12,000,000

14,000,000

16,000,000

BAU GWP<10 BAU Other New Measure GWP<10

Figure 11: Small MAC Bank BAU and GWP Threshold Measures in tonnes.

The threshold ban in the timetable is GWP >150 however all of the primary commercially available alternatives have a GWP less than 10.

The effect of this change in the predominant species in the MAC bank on the total GWP of the bank in that class of equipment is illustrated below. Figure 12 compares the changing GWP throughout the projection period of the MAC bank under a BAU scenario, as compared to the GWP of the MAC bank under the GWP based threshold restrictions scenario.

The effect on the sales mix is illustrated in Figure 25 in Appendix C which compares the new equipment sales mix for BAU with New Measures with the GWP restriction.

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Transition of the Small MAC Bank BAU and New Measures (Mt CO2e)

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 20300.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

16.00

BAU New Measures GWP<10

Figure 12 Transition of the Small MAC bank in Mt CO2e for BAU and New Measures from 2014 to 2030.

The change in the composition of the bank is led by the change in sales mix of vehicles projected for the period. The two charts below compare the sales mix under a BAU scenario with the sales mix projected under the GWP threshold restrictions.

The second largest gain is made in remote condensers and self contained refrigeration used in the cold food chain that together deliver 2.42 Mt CO2e of SGGs (~ 36% of total abatement). For details on when restrictions commence refer to Table 18.

In the charts illustrating the changing sales mix for remote condensers below it is obvious that refrigerants employed in the cold food chain in general, and particularly in remote condenser systems is diversifying rapidly over the course of the projection period as new gas species and system designs are commercialised. Under the BAU scenario the predominance of the high GWP HFCs is eroded by increases in systems charged with ammonia, hydrocarbons, CO2, HFOs and a range of HFC blends that are emerging with GWPs<1000, and <2150.

Under the BAU scenario it is projected that by 2030 new sales of equipment containing HFC-134a, and HFC-404A will cease entirely.

Given this wide selection of refrigerant options, this class of equipment presents a range of opportunities for changes to the sales mix if subject to GWP based threshold limitations on refrigerants employed. The EUCE Model GWP threshold timetable calculates that with a ban on refrigerants with a GWP >2500 introduced by 2020, the market will cease new sales of remote condenser systems containing this high GWP refrigerant by that year, with sharp declines in sales projected for the three years prior to that point.

With measures like this, given the range of options open to the market, it is thought that regulators would be in a position to broadcast a date for such a ban well in advance of actual implementation, and the industry would respond competitively to bring alternative product lines to market well in advance of the deadline for such a restriction.

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A similar opportunity for market transformation is clearly visible in the charts illustrating the sales mix of self contained commercial refrigeration under a BAU scenario as compared to the sales mix projected under the terms of the proposed GWP based threshold limitations for this class. The combined saving for commercial refrigeration is 2.42 Mt CO2e of SGGs comprising 1.42 Mt CO2e from remote condensers, 0.32 Mt CO2e from self contained equipment and the balance of 0.68 Mt CO2e from the supermarket sector.

The EUCE model proposes restrictions on sales of new equipment containing refrigerant with a GWP >2500 commencing in 2020, which is quickly replaced by a restriction on sales of equipment containing refrigerant with a GWP >150 in 2022. That step down gives the market sufficient time to change product out of the supply lines for this class of equipment, which unlike remote condensers, is much closer to an appliance manufacturing model.

The effect of this two phase restriction on the sales mix of self contained equipment is to deliver a similar rate of decline in sales of equipment containing HFC-404A, as is seen in the remote condenser market, with HFC-404A sales ending in 2020. However the step down to a restriction on refrigerant with a GWP >150 in 2022 delivers a similar, although slightly delayed cessation of sales of equipment containing HFC-134a.

Once again, given the wide range of options for effective and energy efficient refrigerant charges that can be employed in this class, regulators could accelerate these changes with early announcements to the market of the intent of these restrictions, which is expected to lead to competitive forces ensuring aggressive marketing of the alternatives well in advance of the implementation date of such a measure.

Noting the changes in the bank of working gases during the last two decades as a result of bans on CFCs and HCFCs, and given the experience of industry and regulators in achieving successful transitions across generations of thermal media, the authors believe there is great potential for GWP based restrictions on refrigerants to deliver long term environmental benefits.

This is particularly the case in classes of equipment where significant improvements to containment and/or end of life recovery cannot be guaranteed. The effect of accelerating a reduction in the GWP value of these banks alleviates future impacts of less than optimal containment and low levels of end-of-life recoveries.

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5.2 Leak Reduction StrategyCore business for an industry that relies on phase change liquids and gaseous thermal media has to be improved containment and reduced handling losses of these materials.

A number of technical and process approaches to leak minimisation are known to deliver reliable improvements in containment and reduced handling losses. For instance, strategies that have been implemented in major supermarket chains during the last ten years are known to have reduced leaks from some of the hardest working classes of equipment by more than 50%.28

Improved containment also results in longer hours of equipment operating on optimal refrigerant charges, which has the effect of improving the efficiency of the thermal services provided, reducing energy used, and wear and tear on the equipment.

Thus leak reduction strategies can deliver compounding cost savings (i.e. reduced expenditure on replacement gas and reduced electricity costs), and in emissions abatement.

RAC equipment is estimated to consume more than 20% of all of the sent out electricity in Australia, and demand for electricity from RAC equipment during heat triggered peak demand events overloads the electricity distribution systems, dramatically increasing the risk of supply disruptions. As such, the fairly simple strategy of leak reduction from RAC equipment has the potential to deliver economy wide benefits.

Leak rates in RAC equipment have been improving as the result of improved equipment design and gas handling methods over the years, however the ‘natural’ rate of improvement to design and fabrication of consumer appliances and commercial equipment can be shown to be just a fraction of a per cent per annum, depending on the class of equipment.

Meaningful reductions in leak rates are achievable using very simple leak inspection routines and strategies.

A Leak Reduction Scenario was designed for the EUCE Model that is based on regulations for mandatory leak management strategies in the EU.

The strategy involves a mix of routine inspections for smaller classes of equipment (at least every 12 months), and automatic leak detection for equipment with larger charges (in GWP terms), greater than 500 tonnes CO 2e. The details of the strategy as applied to the various classes of equipment and charge sizes are set out in Table 30 in Appendix G.

Leak rates in 2013, and targeted rates for 2030 for the broad classes of equipment to which the strategy applies, are listed in the table below. Some of the 2013 rates, particularly supermarkets, have already seen significant improvements in the last decade. However even with these improved leak rates service demand for ODS and SGGs to replace lost gas required more than 3,200 tonnes of ODS and SGGs in 2013 in Australia.

The Leak Reduction strategy targeting larger classes of commercial equipment avoids the equivalent of 8.5 Mt of CO2 (0.15ODS / 8.32SGG) in direct emissions compared to BAU, as well as delivering indirect emissions savings of 4.7 Mt CO2 as a result of improved efficiency for the base case scenario.29 This indirect emission estimate is based on savings of around 2% in medium AC to 5% in commercial refrigeration applications with remote condensing units. Further details of the indirect emission assumptions can be found in Table 31 in Appendix G: Leak Reduction and Maintenance thresholds.

Table 7 provides an overview of the potential emission savings by major equipment class and the target leak rates for a Leak Reduction strategy versus BAU.

28 From leak rates above 20% per annum to 10% per annum.29 The base case scenario for the indirect emissions avoided due to the Leak Reduction strategy for the period 2017 to 2030 is 4.7 Mt CO2e, whereas the mid case is 8.8 Mt CO2e and the high case 14.2 Mt CO2e for the same period.

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Table 7: Annual leak rates and emission savings by major equipment class in 2013, and 2030 BAU versus 2030 with Leak Reduction strategy.

Major equipment class

Annual leak rates Direct emission savings by application (t CO2e)

2013 BAU 2030 Leak Reduction strategy 2030 ODS SGG

Domestic refrigeration 1.1% 1.1% Not applicable (1) - -

RCFC: Self contained 6.0% 6.0% Not applicable (2) - -

RCFC: Remote 15.0% 15.0% 7.5% 0.09 4.44

RCFC: Supermarket 12.5% 9.0% 6.0% - 0.48

Small AC 3.0% 3.0% Not applicable (3) - -

Medium AC 3.0% 3.0% 2.0% 0.04 3.10

Large AC 4.0% 4.0% 3.0% 0.02 0.24

Small MAC 11.5% 8.0% Not applicable (4) - -

Large MAC 12.0% 8.5% 6.0% - 0.06

Totals 0.15 8.32

1. Domestic refrigeration appliances are sealed units with very small refrigerant charges (~140 grams) with very low leak rates. Leak Reduction strategies are not practical for this class of equipment.

2. No leak minimisation measures are placed on this class of equipment in the EU as they are sealed units and have relatively small refrigeration charges. A significant portion of the annual losses in Australia potentially arise from handling practices, and whilst leak minimisations strategies are not assessed for this class of equipment we anticipate new measures would deliver savings from improved handling practices with this equipment class.

3. Similar to comments above, except small AC is already relatively low.4. Regular leak checks and/or log books on over 16 million vehicles is not practical or cost effective versus the potential

benefit as it is thought that a significant portion of the losses from this class of equipment arise from poor handling practices, and separate measures to address this is more effective.

If the Leak Reduction Strategy reduced leak rates in major classes of equipment to the rates listed at 2030, it would in aggregate, over the entire projection period, reduce direct emissions by at least 8.5 Mt of CO2 (0.15ODS / 8.32SGG) below BAU. These avoided emissions involve stopping direct emissions over the entire projection period of more than 5,400 tonnes of refrigerant, representing cost savings in the hundreds of millions of dollars to equipment owners.

Under a BAU scenario, with the predicted rates of migration of some parts of the stock to lower GWP refrigerants, this would have the effect of reducing demand for bulk imported gases from the approximately 4,400 tonnes consumed in 2013, to around 550 tonnes of high and reduced GWP substances in 2030, even while the stock of equipment and the total cooling task being delivered grows significantly.

This emission abatement is sourced from significant improvements in leak rates of commercial refrigeration equipment. Major contributions are made by remote condensing units (53%), and medium AC (37%). Smaller but still notable savings from improved containment in large AC (3%), large MAC (1%) and strong

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improvements among the independent supermarkets (6%) that are the less well maintained segment of the refrigerated cold food chain (RCFC Supermarket in Table 7).

Of the total of some 715 tonnes of reduced losses to air calculated in 2030, the majority of that will be as a result of reduced leaks from the medium class refrigeration equipment with remote condensers (319 tonnes) and from medium and light commercial AC (316 tonnes).

The chart below illustrates the direct emission reductions in Mt CO2e per annum for commercial refrigeration equipment with remote condensers and supermarkets in the refrigerated cold food chain (in red); and the projected savings from medium AC (i.e. split ducted and light commercial AC in commercial applications) and from large AC (in green) from the Leak Reduction Strategy. Savings from large MAC are just visible as a thin line at the top of the chart and represent the savings from Large MAC such as buses greater than 7 meters in length, locomotives and passenger trains.

Direct Emissions Savings from Leak Reduction strategies (Mt CO2e)

2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 20300.000

0.100

0.200

0.300

0.400

0.500

0.600

0.700

0.800

0.900

FP

MAC

AC

Figure 13: Direct Emissions for Savings from Leak Reduction strategies from 2017 to 2030 in Mt CO2e.

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The table below provides an overview of the number of devices and the types of leak inspection and measurement required relative to the potential abatement.

Table 8: Summary of the leak inspection and detection requirements, number of devices in 2017 and emission saving in Mt CO2e by equipment type.

Equipment types Leak inspection/ detection requirements

Number of pieces of equipment in

2017 (2)

Emissions (Mt CO2e)

Direct Indirect

Refrigerated Cold Food Chain – Remote Condensers

Manual every 12 months 238,100

4.5 1.1Manual every 6 months 45,600

Automatic leak detection 1,400

RCFC – Supermarket (independents only) (1) Manual every 6 months 1,900 0.5 0.1

Medium AC (commercial only) Manual every 12 months 1,481,9003.2 2.4

Manual every 6 months 13,300

Large AC (chillers) Manual every 12 months 700

0.3 1.1Manual every 6 months 23,400

Automatic leak detection 3,400

Large MAC (commercial busses and trains) Manual every 12 months 69,800 0.06 n.a.

Totals 1,879,500 8.5 4.7

1. The analysis excludes potentially 1,200 large and medium sized supermarkets that have refrigeration systems that meet the GWP threshold requirements for automatic leak detection systems.

2. The estimates of numbers of pieces of equipment in 2017 were assessed based on the refrigerant mix of 52 product types in Cold Hard Facts 2 (DoE 2013) as the manner in which the stock of equipment was modelled in this report using 9 broad product classes employs aggregate charge sizes that do not provide sufficient detail to assess GWP thresholds by type of leak inspection/detection requirement.

3. Whilst the mix of refrigerant in the entire working bank changes relatively slowly, certain technology categories are expected to transition to low or reduced GWP substances over the next decade, potentially lowering the number of devices requiring inspection and automatic leak detection. For example a typical ducted split system in 2014 (i.e. AC Medium) containing HFC-410A would require leak inspection every 12 months whereas a system containing HFC-32, a refrigerant that has recently been introduced too global markets in this application and that may become increasingly common in Australia in the course of the projection period would not meet the required GWP threshold for 12 month inspections.

5.3 Maintenance Routine maintenance of refrigeration and air conditioning equipment has been repeatedly demonstrated to greatly improve the energy efficiency of the equipment, and increase equipment longevity, across a wide range of equipment classes and types. The larger and harder working the system, the more there is to gain in terms of energy savings from routine preventative maintenance. provides a summary of the direct and indirect emissions savings that could potentially be gained from routine maintenance.

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Table 9: Summary of the estimated direct and indirect emissions savings from routine maintenance in Mt CO2e.

Potential emission savings (Mt CO2e) Direct Indirect Total

Type of equipment (1) ODS SGG Total

Refrigerated Cold Food Chain – Remote Condensers 0.09 4.44 4.5 10.8 15.3

RCFC – Supermarket (independents only) 0.00 0.48 0.5 1.1 1.6

Medium AC (commercial only) 0.04 3.10 3.2 18.2 21.4

Large AC (chillers) 0.02 0.24 0.3 8.1 8.4

Large MAC (commercial busses and trains) 0.00 0.06 0.06 n.a. 0.06

Totals 0.15 8.32 8.5 38.2 (2) 46.8

1. Abatement is calculated as commencing from 2017, which was nominated as the earliest potential date for implementation of improvement measures through to 2030.

2. The base case scenario for the indirect emissions avoided due to the Maintenance activities for the period 2017 to 2030 is 38.1 Mt CO2e, whereas the mid case is 49.9 Mt CO2e and the high case 61.6 Mt CO2e for the same period.

One central feature in a comprehensive preventative maintenance program of RAC equipment is always going to be checking that the appropriate gas charge is being maintained. As such, a proper maintenance program that included improved containment practices on equipment connections, hoses, pipes and accessories, would be expected to identify and remedy any leaks. As such the emissions and efficiency benefits of the Leak Reduction strategy set out in the section above, and the Maintenance strategy, are not cumulative.

However a preventative maintenance program would be go much further in addressing machine maintenance than just identifying and fixing leaks.

For instance a maintenance program consistent with ISO 5149-4: 2014 Refrigerating systems and heat pumps - Safety and environmental requirements - Part 4: Operation, maintenance, repair and recovery, would include, inter alia:

Regular inspection and cleaning of air filters, or replacement if required;

Regular inspection and clearing of the surfaces of condensers, evaporators and fans blades and guards; and,

Regular inspection and repairs improving poor vapour sealing of cool rooms and freezers cabinets. (Poor air tightness adds to the refrigeration load by replacing door gaskets and sealing of insulation to minimise ambient air/moisture.)

The cost of a comprehensive program is more than recovered in reduced operating costs on a range of commercial equipment. A detailed economic assessment would be required to specifically identify at what point the returns on an active maintenance program diminished to levels that were not sufficiently economically rewarding. However for equipment owners with long life assets, the extension to the operating life of the equipment alone, and what that implies for delays in new capital expenditure, can generally provide strong returns on its own.

From the point of view of reduced emissions, a comprehensive maintenance program achieves a much larger level of abatement than leak detection strategies on their own.

Based on a range of assumptions for energy efficiency gains on certain classes of commercial RAC equipment (see Table 30 and Table 31) it is expected that a comprehensive maintenance program, built around ISO 5149-4,

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could, on its own, avoid as much as 38.1 Mt CO2 of energy related emissions over the period from 2017 to 2030 for the base case scenario.30

The scale of this reduction in energy related emissions is very significant and would bring several important additional benefits particularly a saving of more than 41,700 GWh of electricity.31 This is a very significant operating cost saving windfall to equipment owners of at least $6.2 billion over the projection period. 32 Other indirect economic benefits include the potential to catalyse further hundreds of millions of delayed electricity network upgrades, providing community wide benefits in reduced demand and lower peak loads on grid infrastructure.

The emissions abatement and cost saving from reductions in energy use is based on achieving only a 1% per annum improvement in energy efficiency across the stocks of commercial RAC equipment modelled. This is a very conservative estimate.

Indirect emissions reductions are also additional to the 8.5 Mt CO2e (0.15ODS / 8.32SGG) of direct emissions avoided through avoided leaks from RAC equipment that would have occurred in the absence of a preventative maintenance program. The cost saving to equipment owners of the avoided leaks, and thus the reduced demand for service gas has not been calculated, however in total, over the projection period, it would be at least in the hundreds of millions of dollars.

This significant level of abatement and the resulting cost savings are not free as it would require routine expenditure by equipment owners to deliver an effective maintenance program that captured the most rewarding opportunities in the important classes of commercial refrigeration and AC.

However this would not be all new expenditure. Most large equipment owners, particularly with large AC systems and refrigeration in the cold food chain, outside the realm of the two major food retailers, will admit that more is presently spent on emergency call out of RAC contractors than is spent on routine maintenance. As such it would be expected that the costs of a routine maintenance program would displace the great majority of what is already spent on emergency call outs.

The effect of preventative maintenance will also therefore avoid additional costs of business disruption that an equipment breakdown causes. It would reasonably be expected that it would reduce some avoidable losses of foodstuffs that have low tolerance for temperature changes in the cold food chain (and the least tolerant foods are also almost always the most expensive ones – such as caviar, oysters, fine cheeses etc.).

The largest abatement and energy costs savings produced from a preventative maintenance program accrue from Medium AC (18.2 Mt CO2) followed by commercial refrigeration with remote condensing units (10.8 Mt CO2).

A detailed study of the total economic impact of preventative maintenance of major classes of commercial refrigeration and AC equipment would provide a framework in which the return on investment of maintenance regimes could be modelled, and the wider benefits to the workforce and the community could be estimated.

5.4 Log BooksA measure that has been proposed by various sectors of the industry over the past decade, and that would assist deliver and demonstrate results, is an equipment log book.

Many industry participants who service medium and large AC, and equipment in the cold food chain, will state that a lack of documentation reporting previous maintenance, or even providing basic documentation on system design and components, is a major impediment to good practice.

30 The base case scenario for the indirect emissions avoided due to the Maintenance activities for the period 2017 to 2030 is 38.1 Mt CO2e, whereas the mid case is 49.9 Mt CO2e and the high case 61.6 Mt CO2e for the same period.31 Calculated based on an average emission factor of 0.913 kg CO2e/kWh over the period 2017 to 2030.32 Assuming average commercial electricity prices of only 15 cents per kWh over the projection period 2017 to 2030.

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This has been reported as being a particularly acute problem in maintenance of mechanical services in large commercial and public buildings where AC systems can be very complex and extensive. Turnover of maintenance providers often results in loss of primary plans and documentation of systems. Maintenance records are either incomplete or missing entirely.

The HVAC High Efficiency Systems Strategy (HVAC HESS) endorsed by the Ministerial Council on Energy in 2008, noted that a ‘chain-of-custody’ of documentation on major capital equipment was quite plausible from the point of design through commissioning to long term maintenance. This form of a log book was estimated to be able to provide substantial economic benefits to building owners.

If a ‘chain-of-custody’ documentation system were required for all large RAC equipment (likely limited by a minimum charge size), the capacity of the industry to manage leak detection programs, or preventative maintenance programs for the least cost would be greatly enhanced.

Equipment log books could provide a first point of reference for any technician when examining a piece of equipment to analyse problems, or to understand the history of equipment performance and work completed.

Equipment log books, that in effect provide the ‘chain-of-custody’ of a piece of equipment by requiring licensed contractors to sign off against records of work completed, would also allow equipment owners to validate savings, and to understand and record operating costs of individual pieces of equipment over time, providing data that would make it easier to identify exceptions, such as periods of higher gas use, and to calculate efficient points for capital replacement.

Possibly most importantly an equipment logbook provides a record of all maintenance activity. This would support the introduction of any new measures, and the fulfilment of existing requirements and, by providing data on individual equipment maintenance costs, would help demonstrate the cost savings that result from efforts to reduce direct emissions and improve the energy efficiency of RAC equipment.

5.5 New Measures CombinedIn the case of the mix of technical and behavioural strategies discussed above, several are very complimentary, although not all of these measures can be easily modelled in a numeric model.

The combination of at least the Leak Reduction Strategy and the GWP based threshold restrictions can be modelled with high degrees of confidence. Together these two strategies are predicted to be able to deliver at least 15.24 Mt CO2e (0.15ODS / 15.09SGG) of avoided direct emissions and 4.7 Mt CO2e of avoided indirect emissions compared to BAU over the projection period from 2017 to 2030.

Because the assumptions used to construct the EUCE Model are inherently conservative, any new measure modelled is reasonably likely to achieve higher levels of abatement over the long term than the model calculates.

Any mix of the proposed new measures is likely to achieve better outcomes than the sum of the outcomes modelled for individual measures.

This is often the effect of any multi-pronged strategy. Because of differing approaches often delivered via different media through different parts of the supply chain and workforce, a multi-pronged strategy for behaviour or market change will capture a wider audience in total, than a single focus strategy. A multi-pronged approach will also end up attending to more of the total stock of equipment for the same reason.

As discussed in relation to the Maintenance and Log Books measures, the effect of improved equipment maintenance and performance data cannot be easily modelled in a numeric model. However even while assuming no compounding effect of having the sort of good data that one would expect a Log Book to provide on the costs and benefits of a Leak Reduction strategy, or an active Maintenance strategy, the EUCE model projects total avoided direct and indirect emissions from all proposed new measures combined equivalent to more than 56 Mt CO2 over the projection period 2017 to 2030.

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6 Enhanced compliance and workforce engagement

6.1 Data the key to understanding the workforce and measuring reduced emissions and economy wide benefits

The Act introduced Regulations to support competency based licences to the Australian RAC and FP workforce starting in 2005. The Australian Refrigeration Council (ARC) administers the licensing scheme for RAC, and Fire Protection Association Australia (FPAA) administers the scheme for FP, both on behalf of the Australian Government.

By the end of 2014 more than 58,000 licensed RAC technicians (RHLs) and more than 17,000 registered trading authorities (RTAs) were operating within the ARC scheme, in total more than 75,000 authorised businesses and licensed qualified technicians in Australia. This alone is a notable achievement in such a relatively short period.

The ARC services established to deliver the end-use licensing scheme produce a stream of invaluable data on the supply lines and the workforce that service the industry. This is an outcome that illustrates one of the very valuable and direct results of the Act.

The Act requires, or results in, various sources of high quality data, such as reporting of bulk imports and imports of equipment pre-charged with SGGs, that provide an unparalleled ability to analyse the industry and the use and management of ODS and SGGs.

Data gathered along the supply chain and from the licensing of the workforce has resulted in Australia having possibly the most advanced economic and technical model in the world of its RAC and FP industries.

The value of these rich data sources is hard to estimate, however it allows informed decision making by policy makers but also provides tremendous insights for many market participants that supports business planning and human resource planning. On top of that the insights into the industry have already led to Australia being in a position to provide very detailed analysis of emissions from this sector when reporting on its national emissions to the UNFCCC.

6.2 Workforce data can assist target improved handling practices in high reward equipment categories

The stream of data on the RAC and FP workforce, and the enterprises who make up the supply lines for ODS and SGGs, are a tremendous asset to policy makers who need to be able to both understand and communicate with the workforce that manages Australia’s cooling economy.

Due to various restrictions relating to the use of personal and commercial information, the potential for workforce demographic and business intelligence data that ARC could yield for policy makers is, in the opinion of the authors, not yet fully developed.

However as a relatively new organization, dealing with a significant industry, the ARC has proven itself to be an effective vehicle for implementing a complex regulatory scheme across a very significant population, and has established itself in a position of authority and credibility that, in the opinion of the authors, can be used to great effect to maintain and reinforce the efficacy, and the legitimacy of the Act and its objectives.

Two important industry developments that the authors believe that policy makers would possibly be able to use the ARC infrastructure to deliver:

Introduction of new, targeted competency based certificates that deliver the largest emissions abatement and would directly support realisation of the New Measures scenarios such as:

Leak detection, analysis and repair module;

Refrigerant testing and identification module;

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New refrigerants handling;

Data management and log book module; and,

Initiatives such as;

Improved handling practices in high leak rate equipment categories; and,

Introduction of voluntary programs for improved equipment and maintenance program data such as equipment labelling standards and equipment log book.

Establishment of the administrative and training frameworks for these certificates and initiatives could build on the ARC and FPAA infrastructure and target specific sectors of the workforce who routinely interact with high reward equipment classes – i.e. those classes of equipment that are expected to yield the largest direct and indirect emissions abatement with the least effort.

In harder working categories of refrigeration and AC, the key leak rates can still range as high as 15 per cent per annum in major segments of the cold food chain, and more than 11 per cent in MAC. The EUCE model demonstrates that the introduction of end-use licensing has delivered significant improvements across the industry, including reduced leak rates from the larger classes of equipment, however more improvement is possible. Some of this equipment has design lives of longer than 20 years, and will very likely still be losing high GWP SGGs to air beyond the horizon of the present model at these rates.

These categories of equipment present technological and business opportunities for reduced emissions coupled with strong economic returns to equipment owners to pursue improvements.

Of course the experience in the energy efficiency market in the past two decades has demonstrated that business management does not automatically adopt practices that can be shown to produce high rates of return on investments.

Even returns on investments in energy efficiency that produce effective real rates of return of close to 50% per annum can be ignored by business owners and managers because of lack of management time to consider the issues, lack of understanding of the technical risks and issues, concern about business interruption and lack of cash to spend on efficiency improvements, even those that will pay themselves back in a couple of years, and continue to generate cost savings for years to come. These barriers generally increase in importance as the scale of the business goes down.

Sadly experience shows that the smaller businesses, who would benefit the most from energy cost savings as a proportion of net profit, are usually the ones least likely to respond to a strong return on investment opportunity in capital equipment and operation.

This is a well known set of management barriers in the energy efficiency market which has been overcome in many markets using multi-pronged strategies that use a mix of incentives, sanctions, and marketing and promotion.

The RAC industry is a much more specialized market than the general market for industrial or commercial energy efficiency, however there are significant energy savings that flow from successful strategies to improve operation of RAC equipment, and lessons learned in the energy efficiency markets in the last two decades can be applied.

The highest reward RAC equipment categories are assessed as being;

Remote condenser systems, presently consuming more than 650 tonnes of high GWP SGGs per annum, or about 20% of the annual national consumption; and,

Medium AC systems, presently consuming more than 1,000 tonnes of high GWP SGGs per annum.

Greatest total emissions abatement (including direct and indirect emissions abatement), coupled with the greatest economic benefit, is expected to come from improving the operation of remote condenser systems because of

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their higher leak rate (15% per annum) than medium AC (4%) per annum, and the longer hours of operation and thus higher energy use in remote condenser systems.

Total direct emissions abatement potential over the period of modelling for New Measures, from 2017 to 2030, just for leak reduction in systems with remote condensers is estimated to be equivalent to 4.5 Mt CO2e (0.09ODS / 4.44SGG). Indirect emissions reduction as a result of the modelled Leak Reduction strategy captures a further 4.7 Mt CO2e of abatement from reduced energy use. Thus the Leak Reduction strategy is expected to be able to deliver a total of more than 9 Mt CO2e abatement from just remote condensers between 2017 and 2030.33

The more labour intensive and thus more expensive comprehensive Maintenance Strategy modelled on remote condenser systems is estimated to deliver the same reduction in direct emissions as the Leak Reduction strategy, because the technical behaviour proposed under both is effectively identical. However the Maintenance strategy is calculated as being capable of achieving abatement of as much as 10.8 Mt CO2e in indirect emissions over the same period, thus a total of potential abatement of more than 15.3 Mt CO2e between 2017 and 2030.

This is a significant opportunity for abatement from one small class of equipment, and one that would deliver very strong economic returns to equipment owners along the highly competitive and cost sensitive refrigerated cold food chain. However given the as yet uncertain cost-benefit of a regulated maintenance programs for business, the question should be asked as to how much of the Maintenance Strategy proposed might be achieved via a voluntary program that could then be used to establish a business case for a mandatory program? Or alternatively, perhaps the question should be, “How can the practical means for implementing a comprehensive Maintenance Strategy, and the robust economics of a such a program best be demonstrated?”

What the ARC data can tell us is something about the distribution of size of RTAs, in terms of the number of licensed employees they retain. This can, for instance, reveal the smaller number of larger enterprises, the industry leaders by size, on which policy makers might focus a multi-pronged non-regulatory strategy to transform some aspect of the market?

The most recent data available provides a distribution as set out in below.

33 The base case scenario for the indirect emissions avoided due to the Leak Reduction strategy for the period 2017 to 2030 is 4.7 Mt CO2e, whereas the mid case is 8.8 Mt CO2e and the high case 14.2 Mt CO2e for the same period.

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Dissection of RTA holders by number of licensed employees

1 2 to 5 6 to 10 11 to 15 16 plus

0

1,000

2,000

3,000

4,000

5,000

6,000

MAC

RAC

Number of RHLs Held

Nu

mb

er

of

RT

As

Figure 14: Dissection of RTA holders by number of licensed employees. (Source: Australian Refrigeration Council)

What this shows is that the top three enterprise size ranges, 6 to 10 RHLS, 11 to 15 RHLS, and greater than 16 RHLs, involve 1,202 RTAs. This is just 6.9 per cent of all RTAs issued.

While the ranges of RHLs employed by these larger RTAs does not allow for exact calculations, using the mid point of the lower two ranges, i.e. 8 RHLs in the 6 to 10 set, and 13 RHLs in the 11 to 15 set, and using just 18 RHLs per RTA for the largest category (which is almost certainly conservative), we can calculate that the 1,202 RTAs in the top three ranges employ possibly 12,900 RHLs, or more than 22.5 per cent of all licensed technicians in the market.

We also know from the ARC that the rough split of business focus of these large RHLs is 35 per cent in the auto sector and 65 per cent in the RAC sector. This proportion leads to split of entities as per Table 10 below.

Table 10: Split of Large RTAs and RHLs by Sector.

Substance MAC RACTotal

Large RTAs by Sector (1) 421 781 1,202

Per cent of Total RTAs 2.42% 4.49% 6.98%

RHLs in Large RTAs by Sector (1) 4,515 8,386 12,901

(Source: Australian Refrigeration Council)

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1. Using sector split 35 per cent MAC and 65 per cent RAC.

Thus we can see that in the RAC industry approximately 4.5 per cent of the RTAs on issue are possibly associated with companies that directly employ holders of as many as 14.65 per cent of all RHLs.

The market power of this small pool of large RTAs is even more starkly illustrated if we compare their share of RHLs to just the market in which they are operating. ARC advise that some 31,000 of all RHLs (54%) are employed in working with RAC.34 In that case the more than 8,300 RHLs associated with the large RTAs working in RAC represents more than 27 per cent of the RAC workforce.

Thus some 780 business entities employing more than 6 holders of an RHL employ more than one quarter of the RAC workforce.

Given the nature of the RAC service market place, it is almost certain that these 780 SMEs are employed mostly on servicing larger pieces of commercial equipment, such as remote condenser systems and supermarket systems in the cold food chain, and medium and large AC in commercial and public buildings. These two equipment categories are the highest reward equipment categories for the application of new measures, a large proportion of which is likely to be owned by medium to large business operators who have sufficient management expertise and cash flow to be able to respond to high ROI opportunities in plant and equipment.

This cross over point in the industry where all the highest return factors come together is where well designed programs can have the greatest influence on the wider industry. This sweet spot in the industry where the larger service providers, employing a large proportion of the workforce, dealing with larger customers of the industry, who own and operate categories of high reward equipment, is where policy makers should consider leveraging relationships and networks of influence to demonstrate strong economic returns from sensible programs that enhance the business of both the service provider, and the equipment owner.

Further detailed demographic and business research, using ARC and FPAA data as a valuable starting point, and the development of business cases for possible new measures, are recommended. However it is notable that once again, as a result of data collected (in this case by ARC and FPAA) in the process of implementation of the Act, Australian policy makers are in an enviable position to analyse options for action to drive emissions abatement and economic savings through the RAC and FP industries.

6.3 Improved Handling Practices with Mobile Air Conditioning ServiceThe potential for improvements in the skill and commitment of the workforce to minimise direct emissions is further illustrated by the EUCE Model projections of potential savings in the area of servicing and maintenance of small MAC.

Small MAC, with an estimated bank in 2014 of more than 8,900 tonnes of HFC-134a (and some 500 tonnes of residual CFCs) is the second largest portion of the bank (~21%), trailing only behind stationary AC. This bank is contained in a continuously growing fleet of more than 16 million passenger and light commercial vehicles that had a serviced demand for more than 1,000 tonnes of HFC-134a in 2014.

The environmental impact of this consumption of more than 1.8 Mt CO 2e is projected to decline throughout the projection period to around 0.8 Mt CO2e by 2030, due largely to the impact of low GWP gases being used in new vehicles from 2017.

However throughout the projection period, with no changes in compliance, total direct emissions from MAC in passenger and light commercial vehicles are predicted to be more than 13,900 tonnes of HFC-134a (plus more than 290 tonnes of CFCs) to air. These HFC emissions are equivalent to more than 20 Mt CO2.

34 The rest of the approximately 58,000 RHLs are on issue to people working in the automotive industry with mobile air conditioning systems

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This fleet of MACs is serviced by a workforce of more than 26,000 individual licence holders (RHLs), many of whom work through companies holding more than 8,100 registered trading authorities (RTAs).

Average gas charges in vehicles are relatively small, at around 600 grams to 700 grams. However because of the hard working, high vibration environment in which they operate, MAC across the entire vehicle fleet have relatively high effective leak rates, estimated to be at least 11.5 per cent per annum, as compared to domestic refrigeration at close to 1 per cent. Importantly for the implementation of the Act, vehicle owners tend to ensure that MAC are maintained in working order, as the expectation for AC to provide year round comfort conditions in vehicles is high.

The EUCE Model calculates that, by improving compliance with existing regulations among this workforce and thus reducing handling losses in the workplace, over the period from 2017 to 2030 at least 4,100 tonnes of direct emissions of HFCs, equivalent to more than 3 Mt of CO2, could be avoided. This is equal to nearly 20 per cent of the emissions projected under a BAU scenario during the period 2017 to 2030.

Direct Emissions Savings from MAC Service Measures (Mt CO2e)

2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0.000

0.050

0.100

0.150

0.200

0.250

0.300

Figure 15: Direct Emissions Savings from MAC Service Measures from 2017 to 2030 in Mt CO2e.

This potential for abatement compares favourably with the estimated 5.1 Mt CO2e (0.09ODS / 4.92SGG) abatement expected from Leak Reduction strategies in the refrigerated cold food chain and the nearly 3.4 Mt CO 2e (0.06ODS / 3.34SGG) expected from leak reduction strategies in medium and large AC.35

Increasing compliance with existing regulation in the automotive sector is also important, both from the point of view of the management of the GWP of the significant bank of ODS and SGGs still in use in the sector, but also to reinforce the legitimacy of end-use controls of ODS and SGGs across all sectors. At present there is acknowledgement within the industry that compliance in the auto sector is relatively low.

35 Savings from Large MAC (i.e. buses and trains) are only 0.06 Mt CO2e SGGs.

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Based on the present understanding of the direct mechanical leak rate of mobile air conditioning systems, the annual consumption of gas in the automotive sector points to emissions of refrigerant far greater than would be expected just from operating losses.

Annual imports of HFCs for consumption in this sector exceed, by a factor of at least three, what would reasonably be expected to be required if the majority of demand was merely for the replacement of mechanical losses of refrigerant.

If it is the case that there is widespread, habitual and avoidable emissions of refrigerant in the workshops servicing MAC, in the opinion of the authors this workplace culture presents a serious challenge to the legitimacy of the Act and its objectives across the entire RAC and FP industries. A relatively modest field research program would go a long way to identifying exactly the points where losses are most likely to be occurring in the supply chain, and during workshop management. However at this point, given what is known about the supply line, and noting where the financial incentives lie to contain gas (ie along the supply line up to the point of sale to workshops) and where the incentives lie to vent gas (because it is uneconomic to recover) it is assumed that most of the losses are as a result of venting to air from MAC being repaired and serviced in workshops.

Possible reasons for this behaviour may well be a mix of economic and mechanical factors – ie the time it takes to recover gas, or the difficulty in effectively recovering gas because, for instance, of design obstacles in MAC systems, given how much can be charged to service a system. However at this stage it has to be said that there is insufficient understanding of the real cause of the apparently excessive consumption in the area, and therefore no ability to prescribe detailed remedies. Further research into the underlying causes of emissions of HFCs in the MAC supply chain is recommended.

However the question must be asked as to how to cost effectively improve compliance across such a large workforce even if the problem was well understood, given the number of vehicles involved and the small charge sizes in MAC systems.

Once again a greater degree of insight into the demographic and business structures involved in servicing the stock of equipment might identify the low hanging fruit for policy makers to focus efforts on.

In the automotive sector, using the same data as was used in the previous section, it would appear that there are a relatively small number of RTAs employing a considerable proportion of the workforce.

In this auto sector, noting the uncertainties in the data available as previously stated, it is estimated that just 5.2 per cent of RTAs (421) employ nearly 17 per cent of all licensed technicians (4,442). These large employers are likely to be contracted to manage large fleets, hold contracts with taxi companies, or be directly associated with large car dealership networks in some manner.

These large RTAs are more likely to already have better rates of compliance and record keeping, and be more likely to respond to positive certification strategies and negative publicity strategies that might be employed to enrol this sector of the market in making higher compliance a routine.

As with the RAC contractors, it is reasonably expected that developing a higher level of expectation for, and familiarity with routine compliance in a key part of the auto sector workforce, will have the effect of raising standards across the wider sector as technicians change jobs and move around, and have the effect of underpinning a higher level of recoveries from ELVs as the skilled workforce brings greater awareness to the management of residual charges when opportunities to interact with ELVs arise.

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7 End-of-Life Equipment and Vehicles Every year significant volumes of ODS and SGG are emitted from equipment and vehicles that reach the end of their working life. Most of the RAC equipment and vehicles containing MAC that retire from use are scrapped to recover the recyclable metals. Some industry industry participants believe that the majority of the machinery and vehicles scrapped do not have refrigerant charges recovered before scrapping.36 For instance the EUCE model, uses industry accepted life cycles and equipment survival and scrapping curves across the entire stock of equipment calculate that there was more than 2,100 tonnes of residual gas in all end-of-life (EOL) RAC equipment in 2013, a year in which slightly more than 358 tonnes of gas was returned to RRA for destruction.

The ODS and SGG lost to air from EOL RAC equipment and end-of-life vehicles (ELVs), is not included in the effective leak rates used in the EUCE Model to calculate direct emissions.

EOL RAC equipment and ELVs present entirely different economic and technical challenges for the recovery of ODS and SGGs than does the maintenance and operation of equipment. Further it was decided early in the development of the stock model that including EOL and ELV emissions as part of the ‘effective leak rate’ of the stock of equipment, may obscure the scale and technical opportunities to reduce supply line and operating losses while also failing to clearly identify the pool of residual gas in end-of-life equipment.

Because the economic driver that dictates the management of end-of-life vehicles and equipment is primarily the recovery of valuable recyclable metals, that in many cases are worth orders of magnitude more than the value of the residual refrigerant, the pool of residual gas in EOL and ELVs is likely to be better managed by specific programs that take into account the circumstances of this body of gas which, particularly as the residual charges get smaller, are worth only a fraction of the labour cost of recovering them (DoE 2015).

The EUCE Model calculates the average numbers of pieces of equipment in various categories that can be expected to retire every year. Residual charges calculated as remaining in retiring equipment take account of leak rates applied during the service life and uses factors for end-of-life residual (%) and technical recovery (%) consistent with a previous report undertaken by Expert Group37 (SEWPaC 2013) and IPCC best practice guidelines.

There was no back casting done of the EOL RAC equipment or ELVs for the purposes of this report. Reported rates of destruction by RRA are taken as the proxy for volumes recovered from EOL RAC and ELVs. As noted elsewhere, and illustrated in Figure 16 this recovered and destroyed gas is assessed as largely the result of the influence of the Act.

Because of the very different types of equipment involved and the separate workforces and supply chains, EOL RAC and ELVs are discussed separately.

36 A recent report for the Department by KPMG (KPMG 2014) estimates that as much as 80% of refrigerant is recovered from some classes of domestic RAC equipment at the end of its useful life. This estimate was based on interviews with industry participants. However, other industry participants believe that this estimate is too high based on the volumes of waste refrigerant returned to RRA for destruction, their assessment of, levels of refrigerant recycling in the field, and the availability of recovery cylinders available.37 Clearing the Air, The options for a Rebate for Destruction of ODS and SGGs in Australia, for the Department of Sustainability, Environment, Water, Population and Communities, Jan 2013.

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RRA Destruction volumes from 2003 to current, and predictions to 2030 (kilograms)

Figure 16: RRA destruction volumes in kilograms from 2003 to current, and future projections to 2030.

Notes:1. Destruction values are for financial year rather than calendar years, and historical values are based on actual data

provided by RRA.2. Future projections are reported as being based on 5% growth from 2016 onwards, a point where destruction levels are

predicted by RRA to return to 2009 or 2011 levels. 3. The initial growth just after the turn of the century was largely due to industry education and enhanced marketing, etc.4. Growth in 2004 to 2005 was due to expansion of program to include HFCs, and an increase in rebates.5. Growth from 2005 onward was due to Ozone Act ban on preventable emissions, licensing, and compliance auditing,

etc.6. The dip in 2009/10 was due to GFC, and exacerbated by a simultaneous reduction in the rebate paid at that time from

$2 per kg to $10 per kg for returned gas.7. The decline from 2011/12 was due to the implementation of the equivalent carbon levy, coupled with the accelerated

phase-out and thus supply constraints of HCFC-22, causing an increase in the price of HCFC-22 and strong growth in HCFC-22 recycling and subsequent reductions in returns for destruction

8. The future projections were used in the EUCE model to calculate the gas lost to air, that was technically recoverable discussed in the next two Sections on EOL RAC and ELVs.

7.1 End-of-life Refrigeration and Air ConditioningIn a BAU scenario the EUCE Model calculates that in 2014 more than 1,128 tonnes of HCFCs and 418 tonnes of HFCs (excluding ELVs, and retiring domestic refrigeration) was contained in EOL RAC equipment – a total of more than 1,546 tonnes of ODS and SGGs from more than two million retiring pieces of equipment.

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Of this 2014 EOL gas, it is expected that approximately 224 tonnes (~15%) will be recovered and destroyed, although this is a notably low year for recoveries. RRA has reported recoveries of greater than 500 tonnes in two of the last five years and expects recovery rates to return to those levels in the next two years. It should be noted that gas RRA destroys includes gas recovered from ELVs.

These annual volumes of the EOL pool of gas rise steadily throughout the projection period, reaching a peak of more than 2,533 tonnes in 2030. This growth in the EOL pool is largely led by the growing retirements of AC, a result of the very rapid rate at which air conditioning systems in the economy grew throughout the last decade, much faster than general economic growth.

The total ODS and SGGs in EOL RAC over the projection period from 2014 to 2030, excluding domestic refrigeration and low GWP refrigerants, is projected to be greater than 40,100 tonnes (~83.7 Mt CO2e) of which a total of some 11,300 tonnes (~21.2 Mt CO2e, 6.7ODS / 14.5SGG) is projected to be recovered and destroyed under a BAU Scenario.

For the purpose of projecting recoveries in any year the EUCE Model applies a range of assumptions and calculations to the total projected volumes of EOL gases:

EOL – the total pool of refrigerant remaining in end-of-life equipment;

EOL Not Recoverable – that percentage of the pool that is technically not recoverable based on experience from the field on technical limits to recovery and assumptions of levels of unrecoverable gases in each category of equipment;

Recoverable – the EOL total pool, less the EOL Not Recoverable;

Destroyed – the volume of gas projected to be recovered and destroyed under a BAU Scenario; and,

Recoverable Emitted to Atmosphere or Reused – which is the Recoverable pool less the projection of Destroyed volumes in any one year.

This last classification is the gas that is lost to air, that was technically recoverable. It is likely that some of this technically recoverable gas is recovered by technicians and re-used in other equipment. This material recovered for reuse would reduce the estimated gas lost to air, but has not been included in the model as there is no reliable data available, however it is thought that it is not significant.

Because effective recovery of ODS and SGG from domestic refrigeration is economically challenging (i.e. very small average residual charges versus the cost of labour to recover), the stock of domestic refrigeration is excluded from the calculation entirely.

How these calculations play out across the projection period are represented in Figure 17 below which illustrates the BAU projection for EOL RAC emissions and destruction. For details on the EUCE model assumptions (i.e. EOL factors by equipment) and EOL outputs (kilograms and Mt CO2) refer to Table 34 to Table 36 in Appendix I: End-of-life assumptions and outputs.

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Refrigeration and Air Conditioning EOL BAU Scenario (Mt CO2e)

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0.000

1.000

2.000

3.000

4.000

5.000

6.000

EOL Recoverable

Destroyed Recoverable emitted to atmosphere or reused

Figure 17: Refrigeration and Air Conditioning End-of-life Business as Usual Scenario with refrigerant projections of EOL, technically recoverable, destruction and recoverable emitted to atmosphere or reused in Mt CO2e.

Given that the residual gas in EOL domestic refrigeration in 2014 for instance is calculated to be some 110 tonnes of HFCs, the EOL pool in that year, from which the recoveries are calculated is reduced by slightly less than seven per cent to approximately 1,540 tonnes. When the residual gas in retiring domestic refrigeration is excluded, even the very low year for RRA recoveries in 2014 at 224 tonnes, starts to look more effective at around 15 per cent of total estimated EOL gas in that year.

This report does not attempt to explore the options for policy makers to achieve enhanced recoveries, however the model can be used to project the additional volumes of ODS and SGG recovered and destroyed at various levels of enhanced recovery.

For instance the chart below (Figure 18) illustrates additional recoveries (orange bar) across the projection period should recovery across the entire stock of RAC equipment (excluding domestic refrigeration) be improved by 40%. This substantial increase is thought to be possible, and one that was likely to have been exceeded for a brief period as a result of a rapid increase in recovery of refrigerants during the period in which the equivalent carbon tax was applied to imports of virgin bulk gas.

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Refrigeration and Air Conditioning EOL Opportunity (Mt CO2e)

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0.000

1.000

2.000

3.000

4.000

5.000

6.000

EOL Recoverable emitted to atmosphere or reused

Enhanced compliance savings

Figure 18: Refrigeration and Air Conditioning End-of-life characteristics with refrigerant projections for EOL and emission savings due to enhanced compliance recovering 40% recoverable emitted to atmosphere or reused in Mt CO2e.

If such an increase in recoveries commenced by 2017, from that point up until 2030, an increase of 40% in recoveries improves total recovery and destruction above BAU by the equivalent of more than 18.8 Mt CO 2. This would increase total recoveries over the projection period to more than 40 Mt CO2e, or very nearly 50% of the entire EOL RAC pool of ODS and SGGs.

While this is an interesting academic exercise, the reality is that the economics of recovery of residual refrigerant from most classes of equipment is uneconomic other than possibly in a few classes of the largest equipment. A thorough assessment of the supply chain and attributes of each of the major classes of equipment is needed to understand the economics of EOL recovery and identify the most promising opportunities where some additional incentive or regulation might establish a viable process and foster a culture of routine EOL recovery.

7.2 End of life VehiclesA 2014 research report prepared by the Expert Group for the Department of Environment 38 calculated that in 2013, out of a fleet of some 16 million passenger and light commercial vehicles (PLVs), approximately 658,000 PLVs were not re-registered in Australia, effectively entering the population of end-of-life vehicles (ELVs).

The numbers of ELVs grow steadily throughout the projection period to reach more than 1 million units per annum by the end of the projection period. By that time an increasing number of them will have MAC charged with low GWP refrigerants. However the average life of the fleet of vehicles on Australian roads is 18 years, and the majority of ELVs throughout the projection period will be retiring with MAC designed and originally charged with a high GWP refrigerant.

38 Environmental Impacts of Refrigerant Gas in End of Life Vehicles in Australia, Expert Group for the Department of the Environment, Ozone and Synthetic Gas Team, March 2015 (DoE 2015).

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Number of ELVs by refrigerant type from 2013 to 2030

20132014

20152016

20172018

20192020

20212022

20232024

20252026

20272028

20292030

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

GWP <10

HFC-134a

CFC-12

No-MACEL

Vs

(un

its)

Figure 19: Number of ELVs by refrigerant type in Australia from 2013 to 2030.

Approximately one third of the ELVs in 2013 were damaged by a collision or event, or were part of the relatively small number of vehicles that were stolen. Approximately two thirds were not re-registered and retired from use as a result of old age, mechanical breakdown or due to economic circumstances decided by the vehicle owner.

It is estimated that as much as one third of all ELVs had no residual refrigerant charge when dismantled or crushed. However across the entire population of ELVs it is estimated that they contained on average 340 grams of refrigerant gas each. In aggregate ELVs in 2013 contained approximately 187 tonnes of high GWP refrigerant, comprising 166 tonnes of HFC-134a and 21 tonnes of CFC-12.39

The residual HFCs in ELVs had an equivalent global warming impact in that year of 237 kt of CO 2. While we expect that as much as 10 per cent of that pool was recovered by licensed recovery technicians that still means that HFCs equivalent to more than 200 kt CO2e were likely to have been emitted from ELVs. This is equivalent to more than 11 per cent of the estimated direct emissions from entire stock of operating mobile air conditioning systems in 2013.

The EUCE Model projects that emissions of ODS and SGGs from ELVs under a BAU scenario from 2014 to 2030 will be the equivalent of 6.79 Mt CO2e. In that period it is calculated that under a BAU scenario ODS and SGGs recovered from ELVs and destroyed will avoid emissions of 0.75 Mt CO2e at most.

The losses to air result from systems that individually may hold only 340 grams of ODS or SGGs inside what is effectively an industrial commodity (vehicles ready for scrapping) that is worth hundreds of times more for the

39 Environmental Impacts of Refrigerant Gas in End of Life Vehicles in Australia, Expert Group for the Department of the Environment, Ozone and Synthetic Gas Team, March 2015 (DoE 2015).

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spare parts and metals than the residual gas. Most of the value to be gained from scrapping an individual vehicle can also be achieved very cost effectively by essentially wrecking the vehicle.

The recent study by the Expert Group into this industry found that at most 10% of ELVs had gas recovered before scrapping (DoE 2015).

The economic and technical barriers to recovery of this residual pool of gas are considerable. The residual refrigerants are a almost valueless waste material in the $2 billion dollar a year industry that recovers second hand auto parts and valuable metals from this waste stream.

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8 Fire Protection Systems

8.1 IntroductionCertain types of ODS and SGG are used in what are known as Special Hazard Systems for fire suppression. These systems are required in the relatively small proportion of fire protection systems that have to operate in facilities where application of water, dry chemical agents, aqueous salt solutions or oxygen deprivation systems might not be suitable.

While only employing a quite small fraction of all ODS and SGG in the economy, fires suppression by special hazard systems are critical services in the facilities that employ them. Policy that can affect the availability or use of particular fire suppression agents must account for the potential for any restrictions or controls that could impact on the effective design, operation and maintenance of these systems.

Applications

Special hazard systems can most commonly be found in telecommunication facilities, computer rooms, data centres, and process control centres.

These types of ‘electronic assets’ protection applications are the most common use for special hazard systems, accounting for more than 75% of the installed base. This is a market expected to maintain steady growth in line with continuing demand for data and telecommunication services.

Land vehicles such as trains, defence vehicles and mining equipment; aircraft and some classes of marine craft, largely pleasure craft in Australia and some foreign flagged vessels, all use special hazard systems. These three markets comprise between 5 and 10% of the end uses each.

Cultural facilities, such as art galleries and libraries also use these waterless systems to avoid damage to their collections. Cultural facilities, while being very visible, comprise less than 5% of this market.

An even smaller and more specialized market for special hazard systems exists in motor sports.

ODS and SGGs employed in Fire Protection

Fire protection applications consumed approximately 1.3% (~54 tonnes) of all bulk ODS and SGGs imported into Australia in 2013 excluding halons.

FM-200® / FE-227TM (HFC-227ea, GWP of 2,900) is the main gas used in the majority of special hazard systems.

Small amounts of FE-25TM (HFC-125, GWP of 2,800) and FE-13TM (HFC-23 GWP 11,700) are used in flooding applications, and FE-36TM (HFC-236fa, GWP of 6,300) can occasionally be found in specialist streaming applications such as portable fire extinguishers for oil platforms.

Estimated annual consumption of common types of ODS and SGGs used in special hazard systems are listed below in .

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Table 11: Estimated consumption by substance in 2013 and ODS/GWP properties.

Substance ODP AR4 GWP-1002013 consumption

(tonnes)

Halon-1211 3 1890 ~ 1 tonne or 2%

Halon-1301 10 7140 ~ 2 to 2.5 tonnes or 4%

NAF-S-III ~ 0.036 ~1444 ~ 0.1 tonne or 0.2%

NAF-P-III ~ 0.014 ~340 ~ 0.1 tonne or 0.2%

FM-200® / FE-227TM 0 3220 = 50 tonnes or 92%

Other HFCs 0 - <0.5 tonnes or <1%

Total all ODS and SGGs ~ 54 tonnes(Sources: Industry consultation, 2013 aggregate survey DoE 2013a and DoE import data)

The predominance of FM-200® / FE-227TM is further illustrated in the chart in Figure 20 below, provided by the Fire Protection Association of Australia, which reports the known volumes of gas deployed to suppress fire, or lost as a result of accidental discharges between 2006 and 2014.

Summary of reported discharges by type of ODS and SGG

FE-360.1%

FM 20078%

Halon 12111%

Halon 13019%

NAF PIII1% NAF SIII

11%

Figure 20: Summary of discharges reported by type of agent from 2006 to current.

It must be noted that incident reporting is a voluntary activity of the members of the FPAA, and as such the data is quite incomplete. While reported discharges to prevent fires are probably reasonably close to total discharges, the real extent of accidental discharges is entirely uncertain. However of the more than 16,800 kg of all types of ODS and SGGs reported as being discharged throughout the period, approximately 3,500 kg was discharged as the result of fire while more than 11,800 kg was reported as discharged accidentally. The reason for discharge of

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a further approximately 1,400 kg was unknown. The FPAA notes that this is not a comprehensive report, as there is no legal requirement to report discharges from special hazard systems. Industry voluntarily reports incidents captured in the Board data, and it is thought that this would at least capture the significant incidents.

The volume of accidental discharges, particularly as compared to the volumes discharged to actually suppress fire, is one of the main reasons that FPAA is involved in a long standing campaign on establishing national mandatory standards for inspection and maintenance of special hazard systems based on the industry’s Australian Standard 1851-2012.

Figure 21, below shows an approximation of emissions by application based on FPAA records of known or reported discharges between 2006 and 2013. While the largest numbers of reported discharges were in buildings, the majority of incidents were not, however it is fair to assume that the proportion of incidents that were reported for aircraft is higher than that for almost any other category because of stricter regulatory and documentation requirements in that industry, other than possibly mining. The range of systems reported that suffered accidental discharge further illustrates the challenges faced by FPAA in its efforts to establish harmonised national regulation of special hazard systems. Some State governments have either called up AS 1851 into regulation, or have a timetable to do so, however thus far the standard has only been made law in building control regulation. Special hazard systems in aviation, defence vehicles, marine systems and in mines, for instance, are not subject to those regulatory initiatives.

Summary of reported discharges by application40

Aircraft25%

Boat9%

Building40%

Building/Mine1%

Mine9%

Unknown3%

Vehicle14%

Figure 21: Summary of discharges reported by application from 2006 to current.

40 Dissection based on number of incidents rather than kilograms.

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8.2 Model Outputs

8.2.1 Fire protection summaryA summary of the emission reductions associated with handling losses and leaks from special hazard of fire protection systems as a result of the Act is provided in Table 12. These estimates exclude the ODS and CO2e emissions avoided due to the operation of the National Halon Bank and associated end-use licensing controls equating to around 10,225 ODP tonnes and 7 Mt CO2e recovered for disposal.

Table 12: Summary of the estimated emissions avoided from 2003 to 2030 in Mt CO2e as compared to a No Measures scenario.

Emissions avoided (Mt CO2e) 2003 to 2013 2014 to 2030 (1)

Direct emissions by improvement measure ODS (1) SGG Total ODS SGG Total

Improvements in reducing handling losses and leaks from all classes of fire protection systems 0.00 0.33 0.33 0.00 1.31 1.31

1. Emission estimates for the period 2014 to 2030 are projections based on the assumption that current end-use controls are maintained.

2. ODS substances (i.e. NAF-P-III and NAF-P-III) represent around 0.2% of volumes consumed.

8.2.2 Fire Protection Bank For the first time key elements of market data have been assembled that allows for a reasonable estimation of the standing bank of SGGs used special hazard systems in Australia.

Carbon Dioxide was originally used in first generation special hazard system however the technology required a lot of space, relative to newer systems, and CO2 presents a risk of asphyxiation.

Halons became increasingly common place in military, aviation and electronic asset protection from the 1970s and were the mainstay for special hazard systems until the late 1980s when, following the introduction of the Montreal Protocol, it became a controlled substance and alternatives were rapidly introduced to the market.

HCFCs and HFCs were predominantly introduced as replacements for Halon 1301. HCFC blends (NAF-S-III and NAF-P-III) can be still be found in existing systems, however have not been installed in new systems for several years and their role has substantially been replaced by HFCs.The largest portion of the standing bank of SGGs in special hazard reduction applications is FM-200. As illustrated in chart below in Figure 22, the EUCE Model estimates that the bank of FM-200® / FE-227TM in 2013 (green) stood at about 1,100 tonnes. A significant proportion of this rapid growth in the bank of FM-200® / FE-227TM was as a result of the replacement of halon systems, however there is no data from the period to define the extent of the halon bank at the time.

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Estimate of FM-200® / FE-227TM standing bank in kilograms

19951997

19992001

20032005

20072009

20112013

20152017

20192021

20232025

20272029

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

No Measures BAU & New Measures

Figure 22: Estimate of FM-200® / FE-227TM standing bank in kilograms.

The red wedge shown in Figure 22 illustrates the difference in the bank predicted between the No Measures and BAU scenarios. In the absence of measures introduced in 2003 the EUCE model predicts that the Fire Protection bank in 2030 would have incorporated at least an additional 197 tonnes of FM-200® / FE-227TM. This projection is based on advice from the industry that the end-use licensing scheme, and the awareness of the GWP of the HFC based agents, underwrote and accelerated the market for HFC alternatives.

As there is no proposal to restrict fire suppressants based on GWP values of the material employed, there are no new measures modelled at this time that would have any significant impact on the composition of the bank into the future.

The predominance of FM-200® / FE-227TM in the market is once again illustrated when the stocks on hand are compared. At last count (December 2013) there was more than 25 tonnes of FM-200® / FE-227TM (includes recycled and reclaimed agent) in inventories in Australia (down from a pre-levy stockpile of 88 tonnes in June 2012), as compared to 310 tonnes of halons in the Australian civilian and defence reserves, and less than 6 tonnes of NAF.

8.2.3 Fire Protection Consumption The EUCE Model calculates that between 2003 and 2013 existing end-use licensing controls reduced emissions to air of SGGs equivalent to 272 kt in aggregate over the period.

Losses to air of ODS and SGGs associated with Fire Protection systems result from handling losses during management and shipping of gas, handling losses at times of system maintenance and system repair, and from accidental discharges of systems, some discharges to prevent fires and losses when systems are decommissioned. The higher levels of skills and awareness in the workforce as a result of the end-use licensing

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controls, and the higher awareness of equipment owners about the nature of the fire suppressant in their systems are reasonably expected to have reduced handling losses and accidental discharges.

The systems are carefully designed for purpose, and as such are very ‘tight’, so that they are ready to operate when needed. This is largely possible because, unlike RAC, there are no moving parts.

Slow and chronic leaks in Fire Protection systems are a significant threat to effective operation and the existence of any leaks would be easy to detect during maintenance if the system charge was low. Losses as a result of slow leaks in operational systems are thought to be negligible.

Coupled with the effect of the end-use licensing controls, annual consumption of FM-200 declined from around 100 tonnes per annum in 2003 to 80 tonnes in 2007, and then further to around 50 tonnes in 2013.

Global market forces resulting in shortages of Fluorspar, an ingredient used in the production of HFCs resulted in the cost of FM-200 increasing in Australia by as much as 40% around 2011.

This increase in price, in addition to the equivalent carbon tax, in place from July 2012 to June 2014, led into a period of economically viable recovery and reuse of FM-200® / FE-227TM and saw a decline in the use of virgin stock. After the repeal of the equivalent carbon tax from July 2014 the industry continued to move towards substitution with alternative agents. Consumption is projected to stabilise into 2015 at which point annual consumption is expected to commence a slow, long term decline to around 30 tonnes at the end of the projection period.

Estimate of FM-200® / FE-227TM consumption from introduction to 2030

20032004

20052006

20072008

20092010

20112012

20132014

20152016

20172018

20192020

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0

20,000

40,000

60,000

80,000

100,000

120,000

No Measures BAU & New Measures

Figure 23: Estimate of FM-200® / FE-227TM consumption from introduction to 2030 in kilograms.

Under a No Measures scenario the EUCE model predicts that consumption would have been as much as 80% higher by 2015 with an additional 40 metric tonnes required for service demand and lost to air during handling.

By 2030 this differential is projected to have closed somewhat although still projects additional consumption in 2030 of more than 25 tonnes of FM-200® / FE-227TM in the absence of existing end-use controls.

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Should the fire protection market operate under the No Measures scenario from 2014 to 2030 the model predicts that a further 1.28 Mt CO2e of emissions would result, more than half of which would result from losses at end-of-life, as set out in Table 13 below.

Table 13: Additional FP Emissions compared to BAU: No Measures Scenario.

Difference versus BAUEmissions (Mt CO2e)

Total handling End of life Total

No Measures: 2003 to 2013 +0.260 +0.073 +0.334

No Measures: 2014 to 2030 +0.531 +0.782 +1.313

8.2.4 HalonsHalons were the primary fire suppressant employed in special hazard systems from the 1970s through to the mid-1980s. There is not a comprehensive inventory on the amount of halon that was imported, installed and in use in various applications across Australia during this time.

The National Halon Bank (NHB) was established in Australia to manage disposal of halon recovered from decommissioned systems and to provide a strategic stockpile to meet Australia essential civilian uses of halon. This was in response to production of new halon being phased out in developed countries in 1994 under the Montreal Protocol and banning of non-essential halon applications under state and territory laws. In excess of 1,375 tonnes of Halon 1211 (ODP of 3) and 610 tonnes of Halon 1301 (ODP of 10) equating to 10,225 ODP tonnes in total has been recovered and sent to the NHB for disposal over the life of the program to date. A significant quantity of recovered halon was destroyed by the NHB, while 320 tonnes was retained as a strategic stockpile to meet Australia’s civilian essential use requirements. The halon recovered has the additional benefit of preventing 7 Mt CO2e of emissions due to its global warming potential (i.e. GWP of Halon 1211 is 1890 and GWP of Halon 1301 is 7140). These emission savings have not been included in the No Measures Scenario as it assumes the National Halon Bank would have continued without end-use licensing controls.

As worldwide production of halon has ceased, essential users in Australia continue to rely on stocks of recovered, recycled and reclaimed halon for fire protection purposes now and in future until suitable alternatives across all critical applications become available.

The main applications for halons at the present time are in:

Commercial and private aviation;

Defence; and

Maritime.41

The majority of halon systems were retired soon after legislation banning its import was introduced in 1993 and complementary bans on non-essential applications were introduced under state and territory legislation. An estimate of the remaining bank of halons in Fire Protection is between 150 tonnes and 200 tonnes. Given the vintage of halon charged equipment it is estimated that between 2017 and 2030 a portion of the installed halon will retire. This means that approximately 10 tonnes of halon per annum will be retiring over the next decade

41 Australian registered ships no longer use (excluding defence naval vessels) halon systems however some halon is supplied to foreign flagged vessels operating in or through Australian waters. It is impractical to retrofit halon systems on board ships and therefore the halon systems will remain in use until the vessel is retired. The NHB only supplies vessels registered in Montreal Protocol signatory countries and access to supplies is limited to the minimum requirements for recharging gaseous fire suppression systems to ensure safe operation.

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and a half. Nearly all of this gas is expected to be recovered and maintained in the NHB for use in essential uses such as in aviation systems.

Under the Montreal Protocol production of new halon was phased out in developed countries in 1994 and in developing countries in 2010. It was anticipated that all halon applications would be gradually replaced, with halon to meet essential applications sourced from stockpiles recovered from decommissioned equipment. In Australia at the time the Australian Halon Management Strategy was developed it was anticipated that halon essential uses would continue until 2030.

In critical applications there does not presently appear to be any equivalent or better technological available for rapid fire suppression, particularly in some aviation and defence applications. Alternative agents that might be used also have undesirable attributes that mean that in the majority of cases, on balance, halon is still the better solution.

The Halon Technical Options Committee of the Montreal Protocol has reported there appears to be sufficient banked halon to meet global demand but there is a global imbalance of where the stocks are held. The Halon Technical Options Committee has requested that excess halon not be destroyed while the imbalance remains. Australia does not destroy excess halon unless it is too contaminated to bring back to specification.

New aviation platforms, notably the Airbus A380 and the Boeing Dreamliner, have been designed and released to the market with a halon charged fire suppression systems. These aircraft have a design life of more than 30 years, and given that these large aircraft are very likely to be in production for at least another 20 years, it is possible that existing halon stocks may have to be managed to be available until the 2060s.

Halons in Australia have been the focus of extensive compliance and reporting systems for the past two decades and the majority of the bank of halons is owned by either institutional clients or by airlines, where engineering expertise is much higher than in the general population. As such it is considered unlikely that new measures contemplated for other fire protection applications will yield much improvement in halon handling and management, however there could be some value in further communication to small-time halon holders (if not users) to explain how they can hand it in. At the same time the importance of ensuring the continuation of best practice management including particularly the minimisation of accidental discharges, maintenance of halon quality, its availability from a demand point of view and comprehensive recovery of installed halons cannot be overstated.

Given the lack of an alternative technology for some applications, and with systems as complex and mission critical as the new aircraft mentioned above, still coming to market, Australian halon stocks are and continue to be a considerable strategic reserve.

At the time of writing total Australian halon holdings for civilian use were estimated at around 310 tonnes. (Halon 1301 ~ 196 tonnes, Halon 1211 ~ 114 tonnes).

8.2.5 Fire Protection New MeasuresThe main new measures proposed in Fire Protection is the establishment of mandatory equipment log books and support for application of AS-1851 to all special hazard systems.

These new measures proposed for the Fire Protection market are projected to provide further reductions in emissions to air, largely from increased recoveries from end-of-life systems, equivalent to nearly 1.35 Mt CO2e over the period.

Some consideration has been given to the effect of a GWP based threshold restriction on fire suppressants. If a restriction on the use of agents with a GWP greater than 2500 were to be introduced from 2017 the model predicts that approximately 430 tonnes of FM-200® / FE-227TM (equivalent to approximately 1.3 Mt CO2) would be displaced from use in new systems over the projection period. It is believed that viable alternatives are already available for most applications, although they are generally more expensive. Therefore a GWP threshold

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that restricted or banned use of FM-200® / FE-227TM would accelerate the projected decline in the employment of this agent at the expense of building owners. However this measure was not adopted in Europe, instead they have opted for a phase down.

Table 14: Emissions Abatement from FP: New Measures Scenario.

Difference versus BAUEmissions (Mt CO2e)

Total handling End of life Total

New Measures: 2017 to 2030 -0.087 -1.212 -1.300

This is based on assuming the industry achieves 70 per cent recoveries from end-of-life systems as compared to 20 per cent thought to be recovered from end-of-life systems now.

The present low rate of recoveries is attributable to a combination of factors including the significant cost of recovery and destruction of fire suppressant in old systems (estimated to be at least $20 per kg to the equipment owner), the lack of uniform requirements across Australian jurisdictions for equipment owners to ensure that all special hazard systems must be serviced and decommissioned by technicians licensed under the Act, and a lack of requirements for facility and equipment owners to maintain and be able to provide documentary evidence of special hazard system management, discharges and decommissioning. A proposal for an equipment log book in this sector would go some way to alleviating the lack of documentation.

Simply having the requirement under the Act for all HFC charged systems to have a dedicated log book that must be signed off by a licensed technician would provide the industry with a valuable opportunity to inform and educate equipment owners about the systems and the agents involved. A natural extension of a log book is to ensure all equipment subject to reporting has high visibility labelling. These simple measures would go some way to reduce the chance of accidental discharges caused by untrained and unlicensed personnel attending to equipment.

At present there is a split incentive between the equipment owner and the industry in relation to end-of-life equipment. In most circumstances an equipment owner would be expected to not want to incur any additional cost when decommissioning and removing old equipment than they believe is absolutely necessary. On the other hand, industry participants who might be quoting on installation of new equipment would not want to make themselves uncompetitive by insisting on full cost recovery of a licensed technician decommissioning the old equipment. In the majority of situations, recovery of gas charges in old systems will cost far more than the gas recovered is worth, so there is no economic incentive for an industry participant to provide this service ‘for free’.

A review of end-use controls should consider this, and possibly explore options for eroding the economic barriers to end-of-life recovery of fire suppressant. Given the projections that approximately 10 tonnes of halons, and as much as 40 tonnes of FM-200® / FE-227TM will be in end-of-life systems every year for the next decade and a half, this very discrete market presents opportunities for greatly elevated end-of-life recoveries.

If recoveries from EOL fire protection systems were to achieve 70 per cent that would deliver an additional 1.2 Mt CO2e of abatement over the projection period from 2017 to 2030.

Reduced handling losses as a result of new measures are smaller but still significant, and expected to avoid the equivalent of 95 kt CO2e over the period.

A requirement to maintain an equipment log book, combined with the effect that would have on the equipment owner’s selection of a service contractor, along with an increase in the application of AS-1851 procedures, is assumed to reduce handling losses and other leaks by around 0.3 per cent per annum, as set out in Table 15 below.

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Table 15: Handling and discharge assumptions for modelled scenarios.

Year Business as Usual No Measures New Measures

Discharge losses

Maintenance losses

Discharge losses

Maintenance losses

Discharge losses

Maintenance losses

2013 0.4% 0.4% 0.8% 0.8% 0.4% 0.4%

2030 0.4% 0.4% 0.8% 0.8% 0.2% 0.2%

8.2.6 Model AssumptionsThe EUCE Model for Fire Protection incorporates the following assumptions in the scenario modelled to produce the outputs discussed below:

100 per cent of equipment is retired in Year 18.

BAU maintenance losses equate to 5 to 10 per cent of charge every 10 years, plus 70 per cent of systems are serviced, which equates to around 0.5 per cent per annum.

New Measures commence from 2017 onward.

BAU EOL Compliance rate = 20 per cent

New Measures EOL Compliance rate = 70 per cent

No Measures EOL Compliance rate = 5 per cent

GWP-100 AR4 of FM-200® / FE-227TM = 2900

General business growth rate from 2015 onward is 1 per cent per annum.

8.2.7 Emerging Technology and the BankThe EUCE model, as it is applied to RAC equipment, projects changes to the bank of ODS and SGGs in RAC as new equipment stocks, charged with new generations of gases, are put into service in the economy. The changing mix of equipment stock is presented as projections of future equipment sales, defined by the type of gas the equipment is charged with.

For various reasons the standing bank of gas employed for fire protection changes much more slowly than the working bank of gas in RAC equipment.

Fire protection systems are generally designed to last for the life of the facility which they are protecting, certainly a design life of at least a couple of decades is common. As fire protection systems are designed very specifically around the delivery of particular types of fire suppressant, only a minority of fire protection systems are likely to be adapted to be charged with a substance different to the original material they were designed to employ.

The Fire Protection industry does not presently have the same diversity of technological options, nor the wide range of applications and equipment price points, as the RAC markets. Fire protection applications are also not optional extras. Fire suppression tasks are generally very clearly defined and the design requirements for systems to deliver the service are exacting. There are significant technical and commercial barriers to new technological entrants.

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In spite of these restrictions there are a range of low GWP alternatives that are technically suitable for many of the applications where ODS and SGG fire protection systems are currently used. They include a fluoroketone called NovecTM 1230 and inert gases and blends such as:

IG-01 (argon);

IG-100 (nitrogen);

IG-55 (nitrogen/argon blend); and,

IG-541 (nitrogen/argon/CO2 blend).

NovecTM 1230 (GWP of 1) is the most widely used replacement for HFC fire protection systems. There are technical challenges in applications involving large spaces as it cannot be piped long distances (i.e. boils off) and requires pocket systems that need to discharge together to be effective. In addition to this, inert gas systems are heavier, have a larger footprint and can take 60 seconds to discharge when compared to 10 seconds for HFC systems. These are important technical disadvantages in certain applications such as military planes or naval vessels.

A potential barrier to inert gas systems is infrastructure such as filling stations. Novec TM 1230 filling stations only exist on the eastern seaboard. FM-200® / FE-227TM is the main alternative used in the mining industry in Western Australia.

Inert gas systems can be also be relatively expensive which presents a commercial barrier to wider deployment of these systems. The removal of the equivalent carbon tax widened the price gap between HFC systems and low GWP alternatives.

The cost barriers do not appear to be insurmountable and shifts in the economic incentives for system selection would almost certainly accelerate the transition to low GWP alternatives. However at the time of writing there are no proposals that the authors are aware of, anywhere in the world, to impose GWP based restrictions on fire suppressants.

Emerging technology that could potentially be employed as an alternative to ODS and SGGs in some circumstances and that could play a part in changing the composition of the future bank include:

Condensed aerosols;

Water mist; and,

Oxygen reduction systems.

A watching brief should be maintained on emerging technologies in international markets that might prove to be effective alternatives to HFCs and to halons.

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9 Conclusions and RecommendationsThe primary and most valuable outcomes for the Australian community and economy that have resulted from the implementation of an end-use licensing scheme under the auspices of the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 (the Act), are the definition of a skilled technical workforce, delivering higher quality service to the RAC and FP industries, and the data on this major economic activity that the Act delivers.

The RAC and FP industries that require ODS and SGGs are a significant part of the Australian economy, possibly 1.8% of GDP, that provides essential or mission critical services into almost every other sector of the economy. The economic, energy, and environmental performance of the RAC and FP industries have real implications for the entire Australian economy.

Within the limitations and assumptions of the EUCE model it is apparent that the implementation of the Act has had a profound effect on the overall environmental and economic performance of the refrigeration and air conditioning industry, and the fire protection industry in Australia. The EUCE model calculates reduced direct emissions of significant scale in relation to Australia’s total greenhouse emissions, due to the improved management of ODS and SGGs in the supply line, and in the fleet of operating equipment. Because the EUCE model is essentially a model of the stock of this equipment in the economy, and is informed by quite exact data on imports of bulk gas and pre-charged equipment, confidence in the calculations of this abatement is very high. Any assumptions regarding the rates of improved containment, and reductions in leaks are also very conservative, so in fact the avoided direct emissions reported here can be taken as minimum likely savings.

The EUCE model also provides good estimates of reductions of energy related emissions, although with less confidence, due to the range of assumptions that have to be applied to the stock of equipment to establish the starting point of electricity demand to satisfy the national cooling task. Once again however the assumptions used are consciously highly conservative to ensure that the values reported for improvements in energy efficiency, the electricity cost savings to equipment owners, and the avoided energy related emissions can be taken as minimum values.

In other words the emissions abatement as a result of the implementation of the Act is highly likely to actually be greater than the total abatement claimed in this report as a result of the Act.

This appears even more reasonable when considering the outcomes of the Act in the economy that cannot easily be modelled in a numeric model.

For instance one of the obvious and important outcomes of the implementation of the Act has been the establishment of ARC to implement the end-use licensing scheme. By issuing more than 75,000 competency based licences and trading authorities in the past decade, and having the means of communicating with this now credentialed work force and supply line, the skills required for managing ODS and SGG have become ‘common’ knowledge, and at least in some sectors of the industry, such as in the professional services companies that install and maintain the larger classes of commercial refrigeration and AC equipment, widely complied with.

The real effect of this cannot easily be modelled, however the obvious outcomes of having tens of thousands of licensed technicians equipped with leak detection devices and recovery equipment, as a minimum tool kit, in the field goes some way to explaining the clear divergence of the steady demand for service gas in the stock of equipment, even while the physical stock and the cooling task it satisfies have grown dramatically in the last decade.

This ‘tooling up’ of a skilled workforce, and the establishment of core competencies required to participate in this very large industry servicing RAC and FP systems, provides a level of confidence to equipment manufacturers and gas importers in the capacity of the industry to adopt new technology. The value of this, while Australia is a technology taker in this sector, cannot be overstated. This ensures that the Australian economy has been able to take on new designs and new technology in this sector as an early adopting economy, allowing us to capture higher efficiencies and the benefit of lower GWP substances in the bank of working gas.

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An obvious demonstration of the powerful effect of this credentialed workforce has been Australia’s capacity to commit to and deliver on an accelerated phase out of ODS under its Montreal Protocol obligations.

By establishing the end-use licensing scheme, the Act has provided this workforce with the authority it needs to distinguish itself from the rest of the trades and technical workforce, and allowed this community to ‘own’ its technological and economic niche in society. Again, the value of the recognition this provides in the workplace, and in the competitive markets for technical and trade services, cannot be understated.

For exactly the same reasons that the full extent of the benefits of end-use licensing cannot easily be modelled, should the circumstances arise that the end-use licensing were removed for some reason, the full extent of the costs would be both impossible to calculate, and difficult to understate.

Certainly the market dynamic would be significantly disrupted once the skills barrier to entry to the services industry was removed. Large numbers of lower skilled participants could be expected to begin underbidding into the market to secure a share of the contract work. This would drive prices and margins down, reducing the capacity of the skilled workforce to compete and to deliver quality services.

The flow on effects of such a disruption to the market would inevitably lead to ‘shoddy’ installations, lower levels of service and equipment reliability that would ripple through the economy as business disruptions, greater electricity consumption, increasing costs of gas replacement as leak rates changed trend and began to rise, slower rates of new technology adoption, and higher capital expenditure as equipment service life fell.

Finally, the capacity of the industry, and policy makers to analyse trends in the industry, and to communicate directly to the community of licensed technicians, would abruptly end as the stream of industry data and personnel information that is required to be collected as part of the licensing process ceases. This data, and other industry and market data, that are a direct outcome of the Act, is what allows the degree of technical and economic modelling that underpins the findings of this report.

The authors strongly recommend that, due to the significant environmental benefits, and the broader economic benefits to the community, that have flowed from the first decade of the implementation of the Act, that all avenues for building on the administrative and economic infrastructure developed under the Act be explored and detailed cost benefit analysis of potential new measures be undertaken for both RAC and FP markets.

Development of new skill sets in the workforce, and the certification of these skill sets under the Regulations, is an obvious and almost certainly economically positive next step for the industry, and its clients, as new generations of technology and thermal media are starting to enter the market, increasing the diversity of technical options for efficiently satisfying the economy wide cooling task.

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Appendix A: Summary of emissions by measures for 2003 to 2013; 2014 to 2020 and 2021 to 2030

Table 16: Summary of the direct emissions by measures for 2003 to 2013; 2014 to 2020 and 2021 to 2030 in Mt CO2e.

Direct emissions (Mt CO2e) for period 2003 to 2013 2014 to 2020 2021 to 2030

Direct emissions avoided by improvement measure ODS SGG Total ODS SGG Total ODS SGG Total

Improvements in reducing handling losses and leaks from all classes of RAC equipment 14.01 5.36 19.37 11.86 11.99 23.85 1.94 17.83 19.77

The continuation of Refrigerant Reclaim Australia’s industry stewardship scheme and its expansion to SGGs 2.14 1.14 3.28 1.49 2.34 3.83 2.57 6.34 8.91

The banning of disposable cylinders and a delayed move by wholesalers to centralised decanting of bulk 0.55 1.14 1.69 0.17 0.54 0.71 - 0.90 0.90

Improvements in reducing handling losses and leaks from all classes of fire protection systems 0.00 0.33 0.33 - 0.46 0.46 - 0.84 0.84

Total direct emissions 16.70 7.97 24.67 13.52 15.33 28.85 4.51 25.91 30.42

Potential emissions savings for new measures ODS SGG Total ODS SGG Total ODS SGG Total

Leak Reduction strategy - - - 0.08 1.17 1.25 0.07 7.15 7.22

GWP based restrictions on the use of SGGs - - - - 0.88 0.88 - 5.89 5.89

Maintenance activities - - - 0.08 1.17 1.25 0.07 7.15 7.22

Improved Handling Practices with Mobile Air Conditioning Service - - - - 0.45 0.45 - 2.56 2.56

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Table 17: Summary of the indirect emissions by measures for 2003 to 2013; 2014 to 2020 and 2021 to 2030 in Mt CO2e.

Indirect emissions (Mt CO2e) for period 2003 to 2013 2014 to 2020 2021 to 2030

Indirect emissions avoided by improvement measure

Improvements in reducing handling losses and leaks from all classes of RAC equipment 3.6 3.0 4.0

The continuation of Refrigerant Reclaim Australia’s industry stewardship scheme and its expansion to SGGs - - -

The banning of disposable cylinders and a delayed move by wholesalers to centralised decanting of bulk - - -

Improvements in reducing handling losses and leaks from all classes of fire protection systems - - -

Potential indirect emissions savings for new measures

Leak Reduction strategy - 1.3 3.4

GWP based restrictions on the use of SGGs - - -

Maintenance activities - 10.8 27.3

Improved Handling Practices with Mobile Air Conditioning Service - - -

1. Abatement is calculated as commencing from 2017, which was nominated as the earliest potential date for implementation of improvement measures.2. Modelling of emissions abatement resulting from a mandatory maintenance regime assumes the same level of improved containment achieved under the Leak Reduction

strategy, as such, in combination with the Leak Reduction strategy. Maintenance activities include a comprehensive Leak Reduction strategy as well as other activities to improve the efficiency of the equipment that would deliver indirect emissions.

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Appendix B: GWP Threshold timetable modelled

Table 18: GWP Threshold timetable modelled for each major equipment class.

2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

Domestic refrigeration 150 150 150 150 150 150 150 150 150 150 150 150 150 150

Self contained 2500 2500 150 150 150 150 150 150 150 150 150

Remote 2500 2500 2500 2500 2500 2500 2500 2500 2500 2500 2500

Supermarket: Cascade 1500 1500 1500 1500 1500 1500 1500 1500 1500

Supermarket: Other 150 150 150 150 150 150 150 150 150

Small AC 150 150 150 150 150 150 150 150 150 150 150

Medium AC 750 750 750 750 750 750

Large AC None

Small MAC 150 150 150 150 150 150 150 150 150 150 150 150 150 150

Large MAC None

The above table is generally consistent with the EU timetable except where EU indicates that a threshold ban has commenced earlier. 2017 was nominated for domestic refrigeration and small MAC as the earliest practical date for implementation of regulation. The primary refrigerant circuit of cascade systems with HFCs ≥1500 GWP typically found in supermarkets can be used. Large MAC - Many variants and safety issues (50% of technology can achieve <150, other 50% requires further development).

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Appendix C: Leak rates assumptions for each scenarioC1: Business as UsualThe leak rates used in the model for the Business as Usual and GWP Thresholds scenarios are identical.

Table 19: Leak rates for Business as Usual scenario: 2003 to 2013.

Year

Dom refrig. Self contained Remote Supermarket Small AC Medium AC Large AC Small

MAC Large MAC

HFC HFC HCFC HFC HCFC HFC HCFC HFC HCFC HFCHCFC42 HFC HCFC HCFC-

123 HFC HCFC HFC

2003 1.5% 9.0% 9.0% 25.0% 25.0% 25.0% 25.0% 5.0% 5.0% 6.0% 15.0% 12.0% 12.0% 1.5% 17.0% 17.0% 17.0%

2004 1.4% 8.6% 8.6% 23.8% 23.8% 23.3% 23.3% 4.8% 4.8% 5.4% 14.1% 10.8% 10.8% 1.5% 16.3% 16.4% 16.4%

2005 1.4% 8.3% 8.3% 22.6% 22.6% 21.6% 21.6% 4.5% 4.6% 4.9% 13.3% 9.7% 9.7% 1.4% 15.7% 15.9% 15.9%

2006 1.3% 7.9% 7.9% 21.4% 21.4% 20.1% 20.1% 4.3% 4.4% 4.4% 12.5% 8.7% 8.7% 1.4% 15.0% 15.3% 15.3%

2007 1.3% 7.6% 7.6% 20.4% 20.4% 18.7% 18.7% 4.1% 4.2% 3.9% 11.7% 7.8% 7.8% 1.3% 14.4% 14.8% 14.8%

2008 1.3% 7.3% 7.3% 19.3% 19.3% 17.4% 17.4% 3.9% 4.1% 3.5% 11.0% 7.0% 7.0% 1.3% 13.9% 14.3% 14.3%

2009 1.2% 7.0% 7.0% 18.4% 18.4% 16.2% 16.2% 3.7% 3.9% 3.2% 10.3% 6.3% 6.3% 1.2% 13.3% 13.8% 13.8%

2010 1.2% 6.7% 6.7% 17.5% 17.5% 15.0% 15.0% 3.5% 3.8% 2.9% 9.7% 5.6% 5.6% 1.2% 12.8% 13.3% 13.3%

2011 1.1% 6.4% 6.4% 16.6% 16.6% 14.0% 14.0% 3.3% 3.6% 2.6% 9.1% 5.0% 5.0% 1.2% 12.3% 12.9% 12.9%

2012 1.1% 6.1% 6.1% 15.8% 15.8% 13.0% 13.0% 3.2% 3.5% 2.3% 8.6% 4.5% 4.5% 1.1% 11.8% 12.5% 12.5%

2013 1.1% 6.0% 6.0% 15.0% 15.0% 12.5% 12.5% 3.0% 3.0% 3.0% 8.0% 4.0% 4.0% 1.0% 11.5% 12.0% 12.0%

42 The sharp step down in leak rate from 8% to 6% in 2014 is due to large price increase in HCFC-22 from around $30 to $100 plus per kg.

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Table 20: Leak rates for Business as Usual scenario: 2014 to 2030 and rates of improvement.

Year


MAC Large MAC

HFC HFC HCFC HFC HCFC HFC HCFC HFC HCFC HFC HCFC HFC HCFC HCFC-123 HFC HCFC HFC

2014 1.1% 6.0% 6.0% 15.0% 15.0% 12.3% 12.3% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 11.3% 11.8% 11.8%

2015 1.1% 6.0% 6.0% 15.0% 15.0% 12.0% 12.0% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 11.0% 11.5% 11.5%

2016 1.1% 6.0% 6.0% 15.0% 15.0% 11.8% 11.8% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 10.8% 11.3% 11.3%

2017 1.1% 6.0% 6.0% 15.0% 15.0% 11.5% 11.5% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 10.6% 11.1% 11.1%

2018 1.1% 6.0% 6.0% 15.0% 15.0% 11.3% 11.3% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 10.4% 10.8% 10.8%

2019 1.1% 6.0% 6.0% 15.0% 15.0% 11.1% 11.1% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 10.1% 10.6% 10.6%

2020 1.1% 6.0% 6.0% 15.0% 15.0% 10.9% 10.9% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 9.9% 10.4% 10.4%

2021 1.1% 6.0% 6.0% 15.0% 15.0% 10.6% 10.6% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 9.7% 10.2% 10.2%

2022 1.1% 6.0% 6.0% 15.0% 15.0% 10.4% 10.4% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 9.5% 10.0% 10.0%

2023 1.1% 6.0% 6.0% 15.0% 15.0% 10.2% 10.2% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 9.3% 9.8% 9.8%

2024 1.1% 6.0% 6.0% 15.0% 15.0% 10.0% 10.0% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 9.1% 9.6% 9.6%

2025 1.1% 6.0% 6.0% 15.0% 15.0% 9.8% 9.8% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 8.9% 9.4% 9.4%

2026 1.1% 6.0% 6.0% 15.0% 15.0% 9.6% 9.6% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 8.7% 9.2% 9.2%

2027 1.1% 6.0% 6.0% 15.0% 15.0% 9.4% 9.4% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 8.6% 9.0% 9.0%

2028 1.1% 6.0% 6.0% 15.0% 15.0% 9.2% 9.2% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 8.4% 8.9% 8.9%

2029 1.1% 6.0% 6.0% 15.0% 15.0% 9.0% 9.0% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 8.2% 8.7% 8.7%

2030 1.1% 6.0% 6.0% 15.0% 15.0% 8.9% 8.9% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 8.0% 8.5% 8.5%

Annual rate of improvement (% p.a.) for nominate period

2003 to 2013 0.35% 0.42% 0.42% 0.50% 0.50% 0.70% 0.70% 0.50% 0.40% 1.00% 0.60% 1.03% 1.03% 0.30% 0.40% 0.34% 0.34%

2013 to 2030 0.00% 0.00% 0.00% 0.00% 0.00% 0.20% 0.20% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.21% 0.20% 0.20%

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C2: No MeasuresThe leak rates for No Measures start at the same leak rate as BAU in 2003 and generally achieve same outcome in 2030 rather than 2013.

Table 21: Leak rates for No Measures scenario: 2003 to 2013.

Year


MAC Large MAC

HFC HFC HCFC HFC HCFC HFC HCFC HFC HCFC HFCHCFC43 HFC HCFC HCFC-

123 HFC HCFC HFC

2003 1.5% 9.0% 9.0% 25.0% 25.0% 25.0% 25.0% 5.0% 5.0% 6.0% 14.4% 11.5% 11.5% 1.5% 17.0% 17.0% 17.0%

2004 1.5% 8.8% 8.8% 24.5% 24.5% 24.1% 24.1% 4.8% 4.9% 6.0% 13.8% 11.1% 11.1% 1.5% 16.7% 16.7% 16.7%

2005 1.5% 8.6% 8.6% 24.0% 24.0% 23.3% 23.3% 4.5% 4.8% 6.0% 13.3% 10.6% 10.6% 1.4% 16.5% 16.5% 16.5%

2006 1.5% 8.5% 8.5% 23.5% 23.5% 22.5% 22.5% 4.3% 4.6% 6.0% 12.7% 10.2% 10.2% 1.4% 16.2% 16.2% 16.2%

2007 1.5% 8.3% 8.3% 23.1% 23.1% 21.7% 21.7% 4.1% 4.5% 6.0% 12.2% 9.8% 9.8% 1.3% 16.0% 15.9% 15.9%

2008 1.5% 8.1% 8.1% 22.6% 22.6% 20.9% 20.9% 3.9% 4.4% 6.0% 11.7% 9.4% 9.4% 1.3% 15.8% 15.7% 15.7%

2009 1.5% 8.0% 8.0% 22.1% 22.1% 20.2% 20.2% 3.7% 4.3% 6.0% 11.3% 9.0% 9.0% 1.2% 15.5% 15.4% 15.4%

2010 1.5% 7.8% 7.8% 21.7% 21.7% 19.5% 19.5% 3.5% 4.2% 6.0% 10.8% 8.7% 8.7% 1.2% 15.3% 15.2% 15.2%

2011 1.5% 7.7% 7.7% 21.3% 21.3% 18.8% 18.8% 3.3% 4.1% 6.0% 10.4% 8.3% 8.3% 1.2% 15.1% 14.9% 14.9%

2012 1.5% 7.5% 7.5% 20.8% 20.8% 18.1% 18.1% 3.2% 4.0% 6.0% 10.0% 8.0% 8.0% 1.1% 14.8% 14.7% 14.7%

2013 1.5% 7.5% 7.5% 20.0% 20.0% 17.5% 17.5% 4.0% 4.0% 6.0% 15.0% 12.0% 12.0% 1.0% 15.0% 15.0% 15.0%

43 The sharp step down in leak rate from 8% to 6% in 2014 is due to large price increase in HCFC-22 from around $30 to $100 plus per kg.

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Table 22: Leak rates for No Measures scenario: 2014 to 2030 and rates of improvement.

Year


MAC Large MAC


2014 1.5% 7.5% 7.5% 19.7% 19.7% 17.2% 17.2% 4.0% 3.9% 5.8% 8.0% 5.9% 5.9% 1.0% 14.8% 14.8% 14.8%

2015 1.4% 7.5% 7.5% 19.4% 19.4% 16.8% 16.8% 4.0% 3.9% 5.5% 8.0% 5.7% 5.7% 1.0% 14.5% 14.6% 14.6%

2016 1.4% 7.5% 7.5% 19.1% 19.1% 16.5% 16.5% 4.0% 3.8% 5.3% 8.0% 5.6% 5.6% 1.0% 14.3% 14.4% 14.4%

2017 1.4% 7.5% 7.5% 18.9% 18.9% 16.2% 16.2% 4.0% 3.8% 5.1% 8.0% 5.4% 5.4% 1.0% 14.1% 14.2% 14.2%

2018 1.4% 7.5% 7.5% 18.6% 18.6% 15.9% 15.9% 4.0% 3.7% 4.9% 8.0% 5.3% 5.3% 1.0% 13.9% 14.1% 14.1%

2019 1.4% 7.5% 7.5% 18.3% 18.3% 15.5% 15.5% 4.0% 3.6% 4.7% 8.0% 5.2% 5.2% 1.0% 13.7% 13.9% 13.9%

2020 1.3% 7.5% 7.5% 18.1% 18.1% 15.2% 15.2% 4.0% 3.6% 4.5% 8.0% 5.1% 5.1% 1.0% 13.4% 13.7% 13.7%

2021 1.3% 7.5% 7.5% 17.8% 17.8% 14.9% 14.9% 4.0% 3.5% 4.3% 8.0% 4.9% 4.9% 1.0% 13.2% 13.5% 13.5%

2022 1.3% 7.5% 7.5% 17.5% 17.5% 14.7% 14.7% 4.0% 3.5% 4.2% 8.0% 4.8% 4.8% 1.0% 13.0% 13.3% 13.3%

2023 1.3% 7.5% 7.5% 17.3% 17.3% 14.4% 14.4% 4.0% 3.4% 4.0% 8.0% 4.7% 4.7% 1.0% 12.8% 13.2% 13.2%

2024 1.2% 7.5% 7.5% 17.0% 17.0% 14.1% 14.1% 4.0% 3.3% 3.8% 8.0% 4.6% 4.6% 1.0% 12.6% 13.0% 13.0%

2025 1.2% 7.5% 7.5% 16.8% 16.8% 13.8% 13.8% 4.0% 3.3% 3.7% 8.0% 4.5% 4.5% 1.0% 12.4% 12.8% 12.8%

2026 1.2% 7.5% 7.5% 16.5% 16.5% 13.5% 13.5% 4.0% 3.2% 3.5% 8.0% 4.4% 4.4% 1.0% 12.2% 12.7% 12.7%

2027 1.2% 7.5% 7.5% 16.3% 16.3% 13.3% 13.3% 4.0% 3.2% 3.4% 8.0% 4.3% 4.3% 1.0% 12.1% 12.5% 12.5%

2028 1.2% 7.5% 7.5% 16.1% 16.1% 13.0% 13.0% 4.0% 3.1% 3.3% 8.0% 4.2% 4.2% 1.0% 11.9% 12.3% 12.3%

2029 1.1% 7.5% 7.5% 15.8% 15.8% 12.8% 12.8% 4.0% 3.1% 3.1% 8.0% 4.1% 4.1% 1.0% 11.7% 12.2% 12.2%

2030 1.1% 7.5% 7.5% 15.6% 15.6% 12.5% 12.5% 4.0% 3.0% 3.0% 8.0% 4.0% 4.0% 1.0% 11.5% 12.0% 12.0%


2003 to 2013 0.00% 0.20% 0.20% 0.20% 0.20% 0.35% 0.35% 0.50% 0.25% 0.00% 0.40% 0.40% 0.40% 0.30% 0.15% 0.16% 0.16%

2013 to 2030 0.17% 0.00% 0.00% 0.15% 0.15% 0.20% 0.20% 0.00% 0.16% 0.40% 0.00% 0.17% 0.17% 0.00% 0.16% 0.13% 0.13%

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C3: Leak Reduction and MaintenanceThe leak rates used in the model for the Leak Reduction and Maintenance measures are identical.

Table 23: Leak rates for Leak Detection and Maintenance measures scenarios: 2003 to 2013.

Year


MAC Large MAC44


2003 1.5% 9.0% 9.0% 25.0% 25.0% 25.0% 25.0% 5.0% 5.0% 6.0% 15.0% 12.0% 12.0% 1.5% 17.0% 17.0% 17.0%

2004 1.4% 8.6% 8.6% 23.8% 23.8% 23.3% 23.3% 4.8% 4.8% 5.4% 14.1% 10.8% 10.8% 1.5% 16.3% 16.4% 16.4%

2005 1.4% 8.3% 8.3% 22.6% 22.6% 21.6% 21.6% 4.5% 4.6% 4.9% 13.3% 9.7% 9.7% 1.4% 15.7% 15.9% 15.9%

2006 1.3% 7.9% 7.9% 21.4% 21.4% 20.1% 20.1% 4.3% 4.4% 4.4% 12.5% 8.7% 8.7% 1.4% 15.0% 15.3% 15.3%

2007 1.3% 7.6% 7.6% 20.4% 20.4% 18.7% 18.7% 4.1% 4.2% 3.9% 11.7% 7.8% 7.8% 1.3% 14.4% 14.8% 14.8%

2008 1.3% 7.3% 7.3% 19.3% 19.3% 17.4% 17.4% 3.9% 4.1% 3.5% 11.0% 7.0% 7.0% 1.3% 13.9% 14.3% 14.3%

2009 1.2% 7.0% 7.0% 18.4% 18.4% 16.2% 16.2% 3.7% 3.9% 3.2% 10.3% 6.3% 6.3% 1.2% 13.3% 13.8% 13.8%

2010 1.2% 6.7% 6.7% 17.5% 17.5% 15.0% 15.0% 3.5% 3.8% 2.9% 9.7% 5.6% 5.6% 1.2% 12.8% 13.3% 13.3%

2011 1.1% 6.4% 6.4% 16.6% 16.6% 14.0% 14.0% 3.3% 3.6% 2.6% 9.1% 5.0% 5.0% 1.2% 12.3% 12.9% 12.9%

2012 1.1% 6.1% 6.1% 15.8% 15.8% 13.0% 13.0% 3.2% 3.5% 2.3% 8.6% 4.5% 4.5% 1.1% 11.8% 12.5% 12.5%

2013 1.1% 6.0% 6.0% 15.0% 15.0% 12.5% 12.5% 3.0% 3.0% 3.0% 8.0% 4.0% 4.0% 1.0% 11.5% 12.0% 12.0%

44 Large MAC devices would be included in the Leak Reduction and Maintenance measures (i.e. buses and trains).

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Table 24: Leak rates for Leak Detection and Maintenance measures scenarios: 2014 to 2030 and rates of improvement.

Year


MAC Large MAC


2014 1.1% 6.0% 6.0% 15.0% 15.0% 12.3% 12.3% 3.0% 3.0% 3.0% 8.0% 4.0% 4.0% 1.0% 11.3% 11.8% 11.8%

2015 1.1% 6.0% 6.0% 15.0% 15.0% 12.0% 12.0% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 11.0% 11.5% 11.5%

2016 1.1% 6.0% 6.0% 15.0% 15.0% 11.8% 11.8% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 10.8% 11.3% 11.3%

2017 1.1% 6.0% 6.0% 14.3% 14.3% 11.2% 11.5% 3.0% 3.0% 3.0% 6.0% 4.0% 4.0% 1.0% 10.6% 11.0% 11.0%

2018 1.1% 6.0% 6.0% 13.6% 13.6% 10.7% 11.0% 3.0% 3.0% 2.9% 5.8% 3.9% 3.9% 0.9% 10.4% 10.6% 10.6%

2019 1.1% 6.0% 6.0% 12.9% 12.9% 10.1% 10.4% 3.0% 3.0% 2.8% 5.7% 3.8% 3.8% 0.9% 10.1% 10.3% 10.3%

2020 1.1% 6.0% 6.0% 12.3% 12.3% 9.6% 9.9% 3.0% 3.0% 2.8% 5.5% 3.8% 3.8% 0.8% 9.9% 10.0% 10.0%

2021 1.1% 6.0% 6.0% 11.7% 11.7% 9.2% 9.5% 3.0% 3.0% 2.7% 5.4% 3.7% 3.7% 0.8% 9.7% 9.7% 9.7%

2022 1.1% 6.0% 6.0% 11.2% 11.2% 8.7% 9.0% 3.0% 3.0% 2.6% 5.2% 3.6% 3.6% 0.7% 9.5% 9.4% 9.4%

2023 1.1% 6.0% 6.0% 10.6% 10.6% 8.3% 8.6% 3.0% 3.0% 2.5% 5.1% 3.5% 3.5% 0.7% 9.3% 9.1% 9.1%

2024 1.1% 6.0% 6.0% 10.1% 10.1% 7.9% 8.1% 3.0% 3.0% 2.5% 4.9% 3.5% 3.5% 0.7% 9.1% 8.9% 8.9%

2025 1.1% 6.0% 6.0% 9.6% 9.6% 7.5% 7.7% 3.0% 3.0% 2.4% 4.8% 3.4% 3.4% 0.6% 8.9% 8.6% 8.6%

2026 1.1% 6.0% 6.0% 9.2% 9.2% 7.2% 7.4% 3.0% 3.0% 2.3% 4.6% 3.3% 3.3% 0.6% 8.7% 8.3% 8.3%

2027 1.1% 6.0% 6.0% 8.7% 8.7% 6.8% 7.0% 3.0% 3.0% 2.3% 4.5% 3.3% 3.3% 0.6% 8.6% 8.1% 8.1%

2028 1.1% 6.0% 6.0% 8.3% 8.3% 6.5% 6.7% 3.0% 3.0% 2.2% 4.4% 3.2% 3.2% 0.5% 8.4% 7.8% 7.8%

2029 1.1% 6.0% 6.0% 7.9% 7.9% 6.2% 6.3% 3.0% 3.0% 2.2% 4.3% 3.1% 3.1% 0.5% 8.2% 7.6% 7.6%

2030 1.1% 6.0% 6.0% 7.5% 7.5% 5.9% 6.0% 3.0% 3.0% 2.1% 4.1% 3.1% 3.1% 0.5% 8.0% 7.4% 7.4%


2003 to 2013 0.35% 0.42% 0.42% 0.50% 0.50% 0.70% 0.70% 0.50% 0.40% 1.00% 0.60% 1.03% 1.03% 0.30% 0.40% 0.34% 0.34%

2013 to 2030 0.00% 0.00% 0.00% 0.48% 0.48% 0.49% 0.49% 0.00% 0.00% 0.27% 0.28% 0.20% 0.20% 0.50% 0.21% 0.30% 0.30%

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C4: Mobile Air Conditioning Service MeasuresTable 25: Leak rates for MAC Service measures scenario: 2003 to 2030.

Year Small MAC Year Small MAC45

2003 17.0% 2020 8.7%

2004 16.3% 2021 8.2%

2005 15.7% 2022 7.8%

2006 15.0% 2023 7.4%

2007 14.4% 2024 7.0%

2008 13.9% 2025 6.6%

2009 13.3% 2026 6.3%

2010 12.8% 2027 5.9%

2011 12.3% 2028 5.6%

2012 11.8% 2029 5.3%

2013 11.5% 2030 5.0%

2014 11.3%

2015 11.0%

2016 10.8%

2017 10.2%

2018 9.7%

2019 9.2%

2003 to 2013 0.40%

2017 to 203046 0.53%

Appendix D: Predicted new equipment sales mix for each scenario45 Small MAC is not covered by leak detection measures and requires separate activities to improve compliance, practices and handling losses.46 Leak rates identical to BAU up to and including 2016, and then improve at a higher annual rate of improvement of 0.53% per annum to 2030.

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D1: Business as Usual and No Measures

Predicted new sales mix of new equipment by year

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

HFC-134a

HFO-1234

HC

No change to BAU.

Domestic refrigeration: BAU Domestic refrigeration: No Measures

Figure 24: Predicted new sales mix for major classes for BAU and No Measures.See other equipment classes on following pages.

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2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

10%

20%

30%

40%

50%

60%

HFC-134a

HFC-404A

GWP<2150

GWP<1000

HFO-1234

HC

CO2

No change to BAU.

RCFC: Self contained: BAU RCFC: Self contained: No Measures

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

10%

20%

30%

40%

50%

60%

70%

HFC-134a

HFC-404A

GWP<2150

GWP<1000

HFO-1234

HC

CO2

Ammonia

No change to BAU.

RCFC: Remote: BAU RCFC: Remote: No Measures

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2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

HFC-134a

HFC-404A

HFC-Mix

GWP<2150

GWP<1000

HFO-1234

HC

CO2

RCFC: Supermarket: BAU RCFC: Supermarket: No Measures (Delayed by 5 years from 2005)

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

HFC-410A

HFC-32

GWP<1000

HC

Stationary AC: Small: BAU Stationary AC: Small: No Measures (Delayed by 5 years from 2004)

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2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

HFC-410A

HFC-32

GWP<1000

HC

Stationary AC: Medium: BAU Stationary AC: Medium: No Measures (Delayed by 5 years from 2004)

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

10%

20%

30%

40%

50%

60%

70%

80%

HCFC-123

HFC-134a

HFC-410A

HFC-32

GWP<1000

HFO-1234

HC

Ammonia

No change to BAU

Stationary AC: Large: BAU Stationary AC: Large: No Measures

No change to BAU

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2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

HFC-134a

HFO-1234

HC

CO2

Small MAC: BAU (1) Small MAC: No Measures

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

HFC-134a

HFC-410A

HFC-407C

GWP<1000

HFO-1234

HC

CO2

No change to BAU

Large MAC: BAU Large MAC: No Measures

1. The proportion of HC indicated in this chart represents service replacement not new sales mix as no new passenger and light commercial vehicles are charged with HC.

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D2: Business as Usual and GWP Threshold Measures

Predicted new sales mix of new equipment by year

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

HFC-134a

HFO-1234

HC

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

HFC-134a

HFO-1234

HC

Domestic refrigeration: BAU Domestic refrigeration: GWP <150 ban from 2017 onward

Figure 25: Predicted new sales mix for major classes for BAU and GWP Threshold Measures.See other equipment classes on following pages.

of 135

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

10%

20%

30%

40%

50%

60%

HFC-134a

HFC-404A

GWP<2150

GWP<1000

HFO-1234

HC

CO2

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

-10%

0%

10%

20%

30%

40%

50%

60%

HFC-134a

HFC-404A

GWP<2150

GWP<1000

HFO-1234

HC

CO2

GWP<150 Ban

RCFC: Self contained: BAU RCFC: Self contained: GWP Threshold Measures

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

10%

20%

30%

40%

50%

60%

70%

HFC-134a

HFC-404A

GWP<2150

GWP<1000

HFO-1234

HC

CO2

Ammonia

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

10%

20%

30%

40%

50%

60%

70%

HFC-134a

HFC-404A

GWP<2150

GWP<1000

HFO-1234

HC

CO2

GWP<150 Ban

RCFC: Remote: BAU RCFC: Remote: GWP Threshold Measures

of 135

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

HFC-134a

HFC-404A

HFC-Mix

GWP<2150

GWP<1000

HFO-1234

HC

CO2

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

HFC-134a

HFC-404A

HFC-Mix

GWP<2150

GWP<1000

HFO-1234

HC

CO2

RCFC: Supermarket: BAU RCFC: Supermarket: GWP Threshold Measures

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

HFC-410A

HFC-32

GWP<1000

HC

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

HFC-410A

HFC-32

GWP<1000

HC

GWP<150 Ban

Stationary AC: Small: BAU Stationary AC: Small: GWP Threshold Measures

of 135

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

HFC-410A

HFC-32

GWP<1000

HC

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

HFC-410A

HFC-407C

HFC-32

GWP<1000

HC

GWP<750 Ban

Stationary AC: Medium: BAU Stationary AC: Medium: GWP Threshold Measures

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

10%

20%

30%

40%

50%

60%

70%

80%

HCFC-123

HFC-134a

HFC-410A

HFC-32

GWP<1000

HFO-1234

HC

Ammonia

No change to BAU

Stationary AC: Large: BAU Stationary AC: Large: GWP Threshold Measures

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2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

HFC-134a

HFO-1234

HC

CO2

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

HFC-134a

HFO-1234

HC

CO2

GWP<150 Ban

Small MAC: BAU (1) Small MAC: GWP Threshold Measures

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

HFC-134a

HFC-410A

HFC-407C

GWP<1000

HFO-1234

HC

CO2

No change to BAU

Large MAC: BAU Large MAC: GWP Threshold Measures

1. The proportion of HC illustrated in this chart is a service replacement rate not new sales mix as no new vehicles are charged with HC.

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D3: Leak Reduction and MaintenanceThe Leak Detection and Maintenance measures use the BAU sales mix scenario.

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Appendix E: MethodologyThe data presented in this report has been derived from an extensive Excel workbook that has, at its core, a stock model of RAC employed in Australia, as well of consumption for all ODS and SGG applications.

This model is referred to as the End Use Control of Emissions (EUCE) Model. The main outputs of the model are:

Direct Emissions from all RAC technology and FP;

Indirect Emissions as a result of energy use by targeted (based on GWP thresholds) RAC technology owned by commercial enterprises;

The Bank of working gas;

Sales Mix of new equipment by refrigerant type; and,

End-of-Life Emissions from the entire stock of equipment.

It is important to note that ‘Total Direct Emissions’ from any particular category of equipment may also be referred to in some instances as the ‘leak rate’, or ‘effective leak rate’, and at other times as ‘consumption’. This is because total direct emissions incorporates:

Gas that leaks from equipment, either from slow leaks in operation, or as a result of ‘catastrophic’ losses when a piece of equipment suffers some sort of breakdown or failure of containment and the entire charge is lost to air;

Gas that is lost through handling losses during installation and commissioning of equipment and servicing of equipment; and,

Plus gas that is lost along the supply chain for the species of gas that the class of equipment requires while gas is being transported, decanted or handled.

The annual leak rate referred to in this report is expressed as a percentage of the initial charge per annum and is calculated as the sum of gradual leaks during normal operation plus; catastrophic losses amortised over the life of the equipment plus; losses during service and maintenance plus; gas that is lost along the supply chain. In the case of mobile air conditioning equipment, the annual leak rate takes into account losses from vehicle crashes, which are classed as catastrophic losses.

Annual consumption of bulk imports of SGGs, after deducting gas used in installation of new systems (i.e. particularly refrigeration equipment pre-charged with nitrogen) and by consumed by OEMs during assembly, is a proxy for effective leak rates, as the balance of the gas is consumed maintaining and servicing the stock of equipment.

Data underlying the stock modelThis stock model was first developed in 2006 during research for what became the first edition of Cold Hard Facts (CHF 1). Primary data sources used for the construction of the original stock model included:

Australian Customs import reports for various product categories (primarily air conditioning equipment by capacity, and some categories);

Department of Environment Water Heritage and the Arts (DEWHA) data on pre-charged equipment imports for 2005 and 2006;

Commercial market research estimating the numbers of residential and small commercial split and packaged air conditioning systems sold in the few years prior to 2006 (by capacity and product type);

Various sales datasets, some partial, from 2004 and going back as far as 1995 for domestic refrigeration, residential and small commercial air conditioning was collected from a number of

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importers, manufacturers and from published market research, constructed into the early years of the model and then exposed for industry comment and review;

Personal communications and interviews with manufacturers and importers of commercial split systems and chillers, and

Personal communications and interviews with manufacturers of commercial and domestic refrigeration systems.

This extensive stock model eventually included estimates of stocks of equipment in all of the major classes of equipment and main applications from as early as 1996 through to 2006.

Equipment retirement rates were developed using knowledge of manufacturers’ warranty conditions, interviews with suppliers, designers and engineers.

Since 2007 when the CHF 1 was published, the stock model has been used by the original authors for several major studies in this field, each one adding something to the scope and substance of the model.

As a result, the original stock model has been extended and refined with new sources of data and market intelligence that included:

The latest issue the Department of Sustainability, Environment, Water, Population and Communities data including bulk and pre-charged equipment import statistics by quantity, mass, species, licence holder, product category from 2006 to 2013 (DoE 2014); 47

Reviews of data included in Regulatory Impact Statements and product profiles for air conditioning equipment (i.e. split systems, chillers, close control, portable, etc.), domestic refrigerators and freezers, non-domestic refrigeration (E3 2009), and other products such as hot water heat pumps (E3 2012);

Reviews of data created for models of domestic energy production;

Interviews with and surveys of manufacturers, importers and resellers of equipment, and with importers and wholesalers of refrigerant gas, parts and tools for the purpose of other RAC industry related studies;

Interviews with industry associations and professional bodies for the purposes of other industry and government programs;

In-confidence industry wide surveys of major participants selling commercial refrigeration condensing units and compressors dissected by capacity and refrigerant;

In-confidence industry wide surveys of suppliers, up-stream processors and end-users of natural refrigerants to establish aggregate industry measures.

Surveys of stock on the floor of domestic equipment retailers.

The authors were unable to identify any similar stock model for any other economy to compare the methodology with, the main outputs or the structure of the model.

The stock model has been further refined following more recent assignment including:

Cold Hard Facts 2 prepared the Department of the Environment, Ozone and Synthetic Gas Team 2013;

A study into HFC consumption in Australia in 2013, and an assessment of the capacity of Australian industry to transition in accordance with the North American Amendment proposal, under the Montreal Protocol, for the Department of the Environment, Ozone and Synthetic Gas Team, March 2014; and

Environmental Impacts of Refrigerant Gas in End of Life Vehicles in Australia December 2014.

Product category stock models47 Not all refrigerants need to be reported to Customs at the point of import, however all of the major classes of HCFCs and HFCs, the ‘synthetic greenhouse gas’ refrigerants must be reported.

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More sophisticated stock models have been developed for major product categories where sufficient quality historical sales data has been discovered. These models use a cumulative distribution function of the normal distribution function to develop survival curves, stock models and equipment retirement estimates by refrigerant species or type.

Where data was available, the model calculates the number of units of a particular vintage that remain in service at the end of a given year as the total number of units sold in the year of the vintage, minus the proportion of units that have been scrapped prior to the end of the given year.

We assume that the lifetime of a unit is normally distributed with a mean lifespan (in years) and standard deviation (in years). The model assumes that on average, units are sold in the middle of a year. So for example, the number of units that were sold in the year 2000 that remain in service at the end of 2012 is given by, N2000 (1-p), where N2000 is the number of units sold in 2000, and p is the proportion that have been scrapped between 2000 and 2012 inclusive and is given by the following function:

Φ (2012-2000+0.5;μ,σ) = Φ (12.5;μ,σ)

Where Φ (x;μ,σ) is the cumulative distribution function (CDF) of the normal distribution with mean μ and standard deviation σ evaluated at x.

The number of units of a particular vintage that are retired in a given year equates to the number of units sold in the year of the vintage that remained in service at the beginning of the given year, minus the number that remain in service at the end of the given year.

The historical sales data is dissected by refrigerant species or type to predict the refrigerant mix of the bank and retiring equipment. This methodology has been refined further for ELVs with a survival curve which is a normal distribution with a mean retirement age of 18.6 years and a standard deviation of 6.2 years up to age 27, then uniform distribution out to age 64 years where it hits 100% of retirements. This curve is simulates actual vehicle registrations in ABS Census of Motor Vehicles, 2014, TableBuilder.

Gas charges and speciesThe size of the gas charges in various equipment classes are known from manufacturers’ documentation and checks of equipment and appliances in the market and for sale. The size of gas charges can be correlated (to some extent) with the input power and size of the compressor employed and the resulting refrigerating capacity of a piece of equipment.

The gas species most commonly employed in the different products are known, although these are not entirely uniform. The proportion of any product in the stock of equipment that is estimated to employ a particular gas species can be checked in many cases by the mix of species employed in pre-charged equipment imports in any year, and against information gleaned from bulk importers and wholesalers of gas.

From 2006 to July 2012 DSEWPaC pre-charged equipment import data was dissected into specific equipment categories including:

Air conditioning chillers;

Packaged air conditioning equipment;

Window/wall units;

Portable air conditioning;

Splits systems (single and multi-head/variable refrigerant flow);

Aircraft;

Other heat pumps;

Mobile air conditioning (vehicles less than and greater than 3.5t gross vehicle mass);

Commercial refrigerated cabinets;

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Domestic refrigerators and freezers;

Transport refrigeration (self and vehicle powered truck refrigeration), and;

Other commercial refrigeration categories.

This information provided seven years of history that was reviewed in great detail to form or confirm views about average gas charges in various products, and the dissection and transition of refrigerant species in products.

The bank of working gasAverage charges of working gas in each product are used to calculate the total bank of working gas by equipment category and segment, and by gas species.

Leak rates for products operating on HFCs or HCFCs are used to calculate the volume of refrigerant gas applied to servicing equipment segments in any year. This service demand is reconciled against the known volumes imported. Refer Table 34 for details of average charge and nominal average lifespans.

DSEWPaC bulk import data provided detailed dissection of HCFC imports by type and blend, whereas HFC bulk import dissection was estimated based on reporting of HFC-134a, secondary refrigerants (HFC-23, HFC-32, HFC-125, HFC-143a, HFC-152a, HFC-227ea, HFC-236fa, HFC-245fa, HFC-365mfc, HFC-43-10mee, which are largely used in common refrigerant blends such as HFC-404A, HFC-410A and others) and ‘exotic’ refrigerants typically used for laboratory research. Mid-way through 2011 full details of HFC bulk imports were provided by type and blend. Bulk gas is primarily imported for servicing and manufacturing RAC equipment, however other uses include charging new commercial refrigeration equipment with remote condensers which are predominantly manufactured or imported with a nitrogen charge and gassed on site. Smaller volumes are used in non-RAC applications including foam blowing, aerosols, fire protection, as cleaning agents (solvents) and electricity distribution.

The volumes of refrigerant gas required for manufacturing is known by directly surveying equipment manufacturers with regard to their manufacturing output, the species employed in the equipment they make and sell, or charge and sell, and the charges employed in that equipment. Many manufacturers have also provided data on the volumes of bulk gases purchased in any year for their production.

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Appendix F: Direct Emissions, GWPs and refrigerant compositionsGlobal Warming Potential (GWP)This report often refers to the global warming potential (GWP) value of the various gases that are the subject of this study.

Australia’s legally binding emission obligations under the Kyoto Protocol are calculated based on the GWP values published in the Second Assessment Report (AR2) of the International Panel on Climate Change (IPCC) released in 1996. Therefore Australian legislation, including the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 (the Act), also cites GWPs from AR2.

However revised GWP values were reported in the Fourth Assessment Report (AR4) in 2007. The 2 nd

Kyoto Protocol commitment period is based on AR4 values and Australia will take on these values from 2015.

This report uses one hundred year GWP values from the Fourth Assessment Report (AR4 GWP-100). A new class of substances that are mentioned in this report are the very low GWP unsaturated HFCs known as hydrofluoro-olefins (HFOs) that were not available at the time of publication of AR4. As such the GWPs attributed to HFOs and HFO blends that are discussed herein are based on industry data. While the Fifth Assessment Report has been released, the AR5 GWP-100 values have not been used, as they were not available at the time of modelling.

Table 26 Below lists both AR2 and AR4 GWP values as a reference for readers, and Table 27 provides details of the refrigerant mass composition of common blends used in Australia that are used to calculate the GWPs of the blends from the IPCC reports.

Table 26: GWP factors of main refrigerant gas species

Common substances AR2 GWP-100 Year AR4 GWP-100 Year

Substances controlled by the Montreal Protocol

CFC-11 (1) 3800 4750

CFC-12 (1) 8100 10900

HCFC-123 90 77

HCFC-22 1500 1810

HCFC-141b - 725

HCFC-142b 1800 2310

HCFC-406A - 1943

HCFC-408A - 3152

HCFC-409A - 1585

HCFC-225ca (3) - 122

HCFC-225cb (3) - 595

Hydrofluorocarbons (HFCs)

HFC-125 2800 3500

HFC-134a 1300 1430

HFC-236fa 6300 9810

HFC-404A (2) 3260 3922

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HFC-407C 1526 1774

HFC-407F 1824 2107

HFC-410A 1725 2088

HFC-417A 1955 2346

HFC-428A 2930 2265

HFC-438A 1890 3667

HFC-507A 3300 3985

HFC-227ea (3) 2900 3220

HFC-245fa (3) - 1030

HFC-365mfc (3) - 794

Lower or nil GWP alternatives

HC-600a (4) - 3

HC-290 - 3

CO2 (R744) - 1

Ammonia (R717) - 0

HFO-1234yf (5) - 4

HFO-1234ze(E) - 6

HFO-1233zd - 6

HFC-152a 140 124

HFC-32 650 675

1. No longer in common use, banned in 1996. GWP values of blends such as HFC-404A and others are calculated based on the mass composition of substances listed in the IPCC assessment reports.

2. All references to HFC-404A include both HFC-404A with a chemical composition of HFC-125/143a/134a (44.0/52.0/4.0) and HFC-507A with a chemical composition of HFC-125/143a (50.0/50.0) as they are very similar in mass composition and service the same applications.

3. Not used as refrigerant in RAC applications, substances used for foam blowing applications, fire protection and as solvents.

4. HC-600a and HC-290 are not published in the AR2 or AR4.5. These are new substances and were not reviewed, included or published in the IPCC, Fourth Assessment Report

published in 2007. The GWP values of HFO substances are those cited by DuPont and Honeywell as based on AR4. The GWPs of HFOs has recently re-evaluated by the UN with HFO-1233zd and HFO-1234ze with a GWP of 1; and HFO-1234yf with a GWP of less than 1. This report uses previous cited values to maintain consistency. The ASHRAE refrigerant mass chemical compositions are used to calculate the GWP values of these blends.

6. Table 27 provides the refrigerant mass composition of common blends used in Australia.

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Table 27: ASHRAE Refrigerant designation and refrigerant mass composition of common blends used in Australia.

ASHRAE Refrigerant designation Refrigerant composition (Mass %)

Refrigerant blends: Zeotropes

404A R-125/143a/134a (44.0/52.0/4.0)

406A R-22/600a/142b (55.0/4.0/41.0)

407C R-32/125/134a (23.0/25.0/52.0)

407F R-32/125/134a (30.0/30.0/40.0)

408A R-125/143a/22 (7.0/46.0/47.0)

409A R-22/124/142b (60.0/25.0/15.0)

409B R-22/124/142b (65.0/25.0/10.0)

410A R-32/125 (50.0/50.0)

436A R-290/600a (56.0/44.0)

436B R-290/600a (52.0/48.0)

Refrigerant blends: Azeotropes

507A R-125/143a (50.0/50.0)

1. The contents of this table is from ANSI/ASHRAE 34-2010, Designation and Safety Classification of Refrigerant, which is published on the ASHRAE website.

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Appendix G: Leak Reduction and Maintenance thresholdsThe table below lists the CO2e thresholds and the calculated refrigerant charge for a range of common substances. Table 34 provides an overview of leak minimisation requirements and frequency of leak checks relative to the CO2e thresholds. Table 30 summarises how this applies to the major equipment classes.

Table 28: Refrigerant charges by common substance for CO2 thresholds.

Common substance

AR4 GWP-100 Tonnes CO2e Threshold

5 10 50 500

Charge thresholds (kg)

HCFC-123 77 64.9 129.9 649.4 6493.5

HCFC-22 1810 2.8 5.5 27.6 276.2

HFC-32 675 7.4 14.8 74.1 740.7

HFC-134a 1430 3.5 7.0 35.0 349.7

HFC-404A 3922 1.3 2.5 12.7 127.5

HFC-407C 1774 2.8 5.6 28.2 281.8

HFC-410A 2088 2.4 4.8 23.9 239.5

HFC-417A 2346 2.1 4.3 21.3 213.1

HFC-227ea 3220 1.6 3.1 15.5 155.3

HFC-245fa 1030 4.9 9.7 48.5 485.4

HFC-365mfc 794 6.3 12.6 63.0 629.7

HFC-Mix 3220 1.6 3.1 15.5 155.3

GWP<2150 1500 3.3 6.7 33.3 333.3

GWP<1000 500 10.0 20.0 100.0 1000.0

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Table 29: Leak Reduction requirements and frequency of leak checks relative to the CO2e thresholds.

CO2e Threshold Frequency of leak checks

No leak detection system Leak detection

5 tonnes CO2e 12 months 24 months

50 tonnes CO2e 6 months 12 months

500 tonnes CO2e Not applicable 6 months

Leakage detection systems are mandatory when the equipment contains more that 500 tonnes CO2e of refrigerant.

Table 30: Summary of Leak Reduction and Maintenance requirements by major equipment classes.

Year Leak Reduction Maintenance Indirect emission opportunity

Domestic refrigeration None No No

Self contained Mostly none - manual every 12 months on larger systems No No

Remote Manual every 6 to 12 months with auto on larger systems Yes Yes

Supermarket Automatic leak detection Yes Independents only

Small AC None No No

Medium AC Commercial only - manual every 6 to 12 (incl. ducted systems upwards) Commercial only Yes

Large AC Manual every 6 to 12 months with auto on larger systems Yes Yes

Small MAC None No No

Large MAC Manual every 6 to 12 months Yes No

Table 31: Assumptions for indirect emission savings for leak reduction and maintenance requirements.Leak Reduction

ScenarioMaintenance

ScenarioCombined Scenario

RCFC - Remote 5% 10% 12%

RCFC – Supermarket (independents only) 5% 10% 12%

Medium AC (commercial only) 2.5% 7.5% 9%

Large AC 2% 7.5% 8.5%

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Appendix H: Indirect emission calculationsAll RAC (vapour compressor) systems have an optimum refrigerant charge at which they achieve designed peak efficiency. Over time, as systems operate, a portion of this charge leaks out of the system causing a drop in refrigerating capacity, rated energy consumption and a deterioration in the co-efficient of performance.

There is a range of international research on performance degradation that supports the EUCE model assumption that RAC systems operating with a sub-optimal charge can easily be performing 10% below optimal energy efficiency levels, and as much as 25% below design efficiency (i.e. depending on the type of system, ambient conditions and the reduction from optimal charge).

The base case scenario calculations for indirect emission savings assume only one system in ten will operate at 10% below design efficiency, and that by eliminating that sub-optimal charge, improved containment practices will deliver a 1% reduction in energy consumption across the whole class of equipment.

The mid case scenario assumes one system in ten will be operating at 25% below design efficiency, and that by eliminating that sub-optimal charge, improved containment practices will deliver a 2.5% reduction in energy consumption across the whole class of equipment.

The high case scenario assumed there will be one piece of equipment in 10 operating at 10% below design efficiency and one piece of equipment in 10 operating at 25% below design efficiency, which when properly serviced deliver an energy saving of 3.5% across the entire class.

The table below lists the indirect emission factors used to calculate the emissions from equipment connected to the electricity grid. Table 33 provides a summary of the assumptions made to calculate the energy and emission saving from improved containment resulting from end-use controls from the Act.

Table 32: Indirect (scope 2) emission factors from consumption of purchased electricity from grid by year.

Year Emission factors (kg CO2-e/kWh) Year Emission factors

(kg CO2-e/kWh)

2003 1.036 2020 0.913

2004 1.032 2021 0.907

2005 1.028 2022 0.904

2006 1.033 2023 0.904

2007 1.035 2024 0.907

2008 1.032 2025 0.905

2009 1.030 2026 0.905

2010 1.022 2027 0.901

2011 1.001 2028 0.897

2012 0.993 2029 0.894

2013 0.982 2030 0.893

2014 0.988

2015 0.988

2016 0.986

2017 0.972

2018 0.951

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2019 0.929

1. Cold Hard Facts 2 used the indirect (scope 2) emission factors from consumption of purchased electricity from the grid as prescribed in NGERS technical guidelines for the estimation of Greenhouse Gas emissions by facilities in Australia, July 2012.

2. The indirect emission factors used in this report are those prepared by EnergyConsult for the Department of Industry in July 2014 for the Air Conditioning RIS.

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Table 33: No Measures Energy Improvement Assumptions by Major Equipment Class.

Major equipment class Energy Improvement from BAU Measures

(Yes/No)

Comment

Domestic Refrigeration No Sealed equipment


No 1% energy saving

Medium RCFC: Remote condensing units Yes 1% energy saving

Large RCFC: Supermarkets Yes 1% energy saving

Small Stationary AC: Self contained No Sealed equipment

Medium Stationary AC Yes 1% energy saving

Large Stationary AC Yes 1% energy saving

Small Mobile AC: Registered vehicles (excl. buses > 7 m) No Not on grid

Large Mobile AC: Off-road vehicles (including buses > 7 m) Yes

1% energy saving for equipment connected to the electricity grid such as locomotive and passenger

rail AC

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Appendix I: End-of-life assumptions and outputs

The table below provides a summary of the key EOL assumptions by major equipment classes and product categories in EUCE model, and Table 35 and Table 36 provides the model outputs in kilograms and Mt CO2e.

Table 34: Technical characteristics for product categories (average charge, end-of-life factors and EOL model used).

Major category Product category

Average charge (kg)

EOL Factors (%) Nominal Av.

Lifespan (Yrs)

EOL model EOL48 Tech

Rec49

STATIONARY AIR CONDITIONING

Small AC

Non-ducted: unitary 0-10 kWr 0.75

85% 90%

10

RAC modelPortable AC 0-10 kWr 0.6 7

HW heat pump: domestic 0.9 10

Medium AC

Single split: non-ducted: 1 & 3 phase 1.7

80% 90%

12

RAC model

Single split: ducted: 1 & 3 phase 4.7 12

RT Packaged systems 12.2 15

Multi split/VRF 8.0 15

Close control 30.0 15

HW heat pump: commercial 110.0 20

Pool heat pump 2.8 15

Large AC

<500 kWr 60

85% 95%

15

RAC model

>500 & <1000 kWr 210 20

>500 & <1000 kWr (HFC-123) 180 20

>1000 kWr 620 25

>1000 kWr (HFC-123) 670 25

MOBILE AIR CONDITIONING

Small MAC

Passenger vehicles 0.61

67% 90%

- ELV modelLight commercial vehicles 0.61 -

Rigid truck and other 1.00 - No

48 The EOL factor is used to calculate the residual EOL charge at end-of-life.49 The calculated EOL charge in each segment has a maximum technical recovery factor that is uniformly set at 90%, except for air conditioning chillers, supermarket systems and commercial refrigeration with remote condensing units where the technical recovery rates are set to 95%.

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Truck: articulated 1.00 -

Large MAC

Commuter buses 1.00

67% 90%

-

Buses (> 7m) 9.00 -

Passenger rail 7.00 10

Locomotive 4.00 10

Off-road, defence and other (boat, etc.) 2.75 15

DOMESTIC REFRIGERATION

Domestic refrigeration

Domestic refrigerators & freezers 0.14090% 90%

-No

Portable and vehicle refrigerators 0.06 8

REFRIGERATED COLD FOOD CHAIN


Refrigeration beverage vending machines 0.25

85% 90%

12

RAC model

Ice makers 0.7 10

Water dispensers (incl. bottle) 0.05 8

Portable refrigerators (commercial) 0.355 14

Small and Medium blend

Beverage cooling (post mix) 1.60

Blend of small and medium factors by

product class

8

RAC model

Refrigeration cabinets 2.00 15

Packaged liquid chillers 60.0 15

Walk-in coolrooms: mini 1.0 12

Walk-in coolrooms: small 5.0 12

Medium RCFC: Remote condensing units

Walk-in coolrooms: medium 17.0

80% 95%

12

RAC model

Walk-in coolrooms: large 23.0 15

Beverage cooling (beer) 40.0 15

Packaged liquid chillers 60.0 15

Milk vat refrigeration 40.0 20

Mobile refrigeration: road: trailer - inter-modal 10.0 10

Mobile refrigeration: road: diesel drive 7.0 10

Mobile refrigeration: road: off engine 4.0 10

Mobile refrigeration: marine 130.0 25

Process chilling 2.00 15

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Large RCFC: Supermarket

Supermarket refrigeration: small 160.0

90% 95%

15

RAC model

Supermarket refrigeration: medium 600.0 12

Supermarket refrigeration: large 900.0 12

Process and large kitchens 160.0 15

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Table 35: EUCE Model End-of-life Outputs for Refrigeration and Air Conditioning equipment in kilograms.

Year EOL EOL Not Recoverable

Recoverable Destroyed Recoverable emitted to

atmosphere or reused

2013 1,318,260 114,112 1,204,149 358,800 845,349

2014 1,546,223 136,482 1,409,741 223,774 1,185,967

2015 1,782,492 159,727 1,622,765 350,000 1,272,765

2016 2,001,654 181,277 1,820,377 500,000 1,320,377

2017 2,181,664 198,930 1,982,734 525,000 1,457,734

2018 2,312,761 211,721 2,101,040 551,000 1,550,040

2019 2,399,106 220,076 2,179,030 579,000 1,600,030

2020 2,451,922 225,117 2,226,805 608,000 1,618,805

2021 2,482,390 227,952 2,254,438 638,000 1,616,438

2022 2,500,688 229,589 2,271,099 670,000 1,601,099

2023 2,516,800 231,016 2,285,784 704,000 1,581,784

2024 2,537,425 232,897 2,304,528 739,000 1,565,528

2025 2,562,047 235,190 2,326,857 776,000 1,550,857

2026 2,583,908 237,249 2,346,659 814,000 1,532,659

2027 2,595,201 238,347 2,356,854 855,000 1,501,854

2028 2,591,228 238,085 2,353,143 898,000 1,455,143

2029 2,570,641 236,405 2,334,236 943,000 1,391,236

2030 2,533,255 233,356 2,299,899 990,000 1,309,899

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Table 36: EUCE Model End-of-life Outputs for Refrigeration and Air Conditioning equipment in Mt CO2e.

Year EOL EOL Not Recoverable

Recoverable Destroyed Recoverable emitted to

atmosphere or reused

Enhanced compliance

savings

2013 2.779 0.230 2.550 0.753 1.796 -

2014 3.218 0.272 2.945 0.482 2.463 -

2015 3.686 0.318 3.367 0.693 2.674 -

2016 4.139 0.363 3.776 0.961 2.815 -

2017 4.536 0.402 4.134 0.998 3.135 1.881

2018 4.851 0.433 4.418 1.037 3.381 2.029

2019 5.084 0.456 4.628 1.080 3.548 2.129

2020 5.246 0.472 4.775 1.129 3.645 2.187

2021 5.351 0.482 4.869 1.183 3.687 2.212

2022 5.414 0.488 4.926 1.240 3.685 2.211

2023 5.450 0.492 4.958 1.302 3.656 2.193

2024 5.469 0.494 4.975 1.367 3.608 2.165

2025 5.467 0.495 4.972 1.436 3.537 2.122

2026 5.429 0.492 4.937 1.506 3.432 2.059

2027 5.343 0.484 4.859 1.582 3.277 1.966

2028 5.206 0.471 4.735 1.661 3.074 1.844

2029 5.022 0.454 4.568 1.745 2.823 1.694

2030 4.794 0.433 4.361 1.832 2.530 1.518

Cumulative saving from enhanced compliance from 2017 to 2030 for 60% compliance rate 28.211

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