EPEE F-GAS INDUSTRY ROUNDTABLE - 15 April
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Agenda 13.00 – 14.00 Registration of participants - Lunch 14.00 – 14.10 Introduction - Andrea Voigt, EPEE 14.10 – 14.25 Evolution of HFC prices - Öko-Recherche 14.25 – 14.35 Q&A 14.35 – 15.05 EPEE EU HFC Model update - Ray Gluckman, Gluckman Consulting 15.05– 15.15 Q&A 15.15 – 15.30 Coffee break 15.30 – 15.45 Update on implementation of the F-gas Regulation - Arno Kaschl, Bente Tranholm-Schwarz, European Commission (DG CLIMA) 15.45 – 15.55 Q&A 15.55 – 16.05 Update on Brexit – Russell Patten, Grayling Brussels 16.05 – 16.15 Q&A 16.15 – 16.45 Dedicated industry activities – Andrea Voigt, EPEE; Angelica Candido, EFCTC; Wolfgang Zaremski, ASERCOM 16.45 – 17.00 Q&A 17.00 – 17.10 HFC phase-down implementation: from a global perspective – Didier Coulomb, International Institute of Refrigeration 17.10 – 17.20 Q&A 17.20– 17.30 Closing remarks Andrea Voigt, EPEE Director General
Development of HFC prices EPEE F-gas Roundtable 15 April 2019 EPEE offices, Brussels Julia Kleinschmidt Öko-Recherche GmbH Frankfurt am Main, Germany
Methodology Companies • from the RAC sector Level 1 • from all supply chain levels 2 to 3 gas producers (selling prices) • from eleven different EU Member Level 2 States (Austria, Czech Republic, 4 to 6 gas distributors (purchase and/or selling prices) Estonia, France, Germany, ~ 25 OEMs (purchase prices) Ireland, Italy, Portugal, Slovakia, Spain, UK) Level 3 ~ 30 service companies (purchase and selling prices) • provide data on purchase and/or selling prices of HFC Level 4 refrigerants and lower GWP alternatives (End-users) • provide additional information on sectoral use, regional availability, prices of quota authorisations ► On average, 60 companies per quarter 15 April 2019 7
Methodology • Ex-post price analysis • Data collected via 1) Standardised questionnaires 2) Personal interviews • Additional information on underlying factors, transition to alternative refrigerants in different sectors, expectations for market and price trends in the next quarters, etc. • More information and questionnaires for download (as excel files) on the Öko-Recherche website • https://www.oekorecherche.de/en/implementation-f-gas- regulation-eu-no-5172014 15 April 2019 8
Methodology Refrigerants covered by the price analysis so far: Refrigerant GWP100 years (AR4) Refrigerant GWP100 years (AR4) R134a 1430 R449A 1397 R404A 3922 R450A 604 R407A 2107 R452A 2105 R407C 1774 R513A 613 R407F 1825 R507A 3985 R407H 1495 R1234yf 4 R410A 2088 R1234ze 7 R422D 2729 R717 (ammonia) 0 R507A 3985 R744 (CO2) 1 R32 675 R290 (propane) 3 R448A 1387 R1270 (propylene) 2 ► Assessment of price developments for the entire refrigerant supply chain and each supply chain level 15 April 2019 9
Update on price developments in 2018 • 2018 was split into two parts: − Flattening of price increases after strong price rises at the beginning of the year − Price decreases in Q3 and Q4 • According to the interviewed companies, different aspects might have affected refrigerant prices − Residual quota quantities (mainly Q4) − Stockpiling in previous years € − Increased care in handling refrigerants − Move to lower GWP alternatives − Illegal trade 15 April 2019 10
Price development of R134a (GWP 1430) Average prices at all levels of the supply chain (price index, 2014 = 100 %) 900 Gas producers (selling price) 800 Gas distributors (purchase price) 700 OEMs (purchase price) 600 Service companies (purchase price) Percent 500 Service companies (selling price = end-user price) 400 300 200 100 Source: Öko-Recherche (2019) 15 April 2019 11
Price developments at service company level Average purchase prices of various HFC refrigerants (price index, 2014 = 100 %) 1500 1300 R404A (GWP 3922) R410A (GWP 2088) 1100 R407C (GWP 1774) 900 R134a (GWP 1430) Percent 700 500 300 * Data recorded in the previous price monitoring project 100 Source: Öko-Recherche (2019) 15 April 2019 12
Development of abatement costs at OEM level Average purchase prices of various HFC refrigerants (in €/t CO2e) 30 R404A (GWP 3922) 25 R410A (GWP 2088) R407C (GWP 1774) 20 R134a (GWP 1430) €/t CO2e 15 10 • Prices of R134a/R410A were stronger than for 5 R404A when considering the GWP 0 Source: Öko-Recherche (2019) 15 April 2019 13
Price developments at service company level Average purchase prices of various alternative refrigerants (price index, Q2/2017 = 100 %) 300 R448A (GWP 1387) 250 R449A (GWP 1397) R452A (GWP 2140) 200 R513A (GWP 631) Percent 150 R1234yf (GWP 4) R32 (GWP 675) 100 50 ► Natural refrigerants: no price changes 0 Source: Öko-Recherche (2019) 15 April 2019 14
Update on price developments in 2018 • Broad price ranges at service company level • Both purchase and selling prices of R404A, R410A, R407C and R134a differed widely ► 75 % – 230 % and 190 % – 280% difference between minimum and maximum prices, respectively • Regional price differences • Gas availability: • The indications have been significantly reduced towards the end of the year • Prices of quota authorisations varied from 15 to 28 €/t CO2e in Q4/2018 • Some gases sold at 50 % lower prices; these may be of illegal sources 15 April 2019 15
Short outlook to 2019 • According to first indications, the trend of late-2018 seems to continue in Q1/2019 − (Very) low demand − Further price reductions of refrigerants and quota authorisations 15 April 2019 16
Thank you very much for your attention! Julia Kleinschmidt julia.kleinschmidt@oekorecherche.de Öko-Recherche Büro für Umweltforschung und -beratung GmbH Münchener Str. 23 60329 Frankfurt/Main GERMANY www.oekorecherche.de @OekoRecherche
Any questions?
EPEE EU HFC Model update Ray Gluckman, Gluckman Consulting
Any questions?
Coffee break
Update on implementation of the F-gas Regulation Arno Kaschl, Bente Tranholm-Schwarz, European Commission (DG CLIMA)
Any questions?
Update on Brexit Russell Patten, Grayling Brussels
Any questions?
Dedicated industry activities Andrea Voigt, EPEE; Angelica Candido, EFCTC; Wolfgang Zaremski, ASERCOM
Illegal imports of HFCs into the European Union April 2019
What are HFCs and what are they used for?
Potential Impacts of Illegal trade in HFCs Impact of Illegal Imports • Scope: HFC-products affecting broadly into sectors STATAC, Heating, Refrigeration and Automotive (Service) • Import of potential serious health & safety hazardous products (flammability/pressure/toxicity) – and lower product performance • A missed economic revenue for Member States: • Loss in Duty & VAT revenue • The environmental goals of the F Gas Regulation are being undermined and postponed Confidential
Way forward to stop Illegal trade Targeted Action at Customs level is needed • Short term - URGENT: 1. Stop the illegal imports 1. from surrounding countries; 2. into main EU harbours 2. Identify false import declarations 1. into EU28; 2. in transit • Mid-term: need a solid electronic notification system for customs to access the F Gas Quota Database How can we work together to stop illegal HFC traffic in the EU and its Member States? 30 Confidential
EFCTC Action plan against illegal imports: Communication strategy • Press release: out on 28 March 2019 • Associations, magazines, journalists, users • Website: • Banner and Info tab published on the EFCTC website: https://www.fluorocarbons.org/
EFCTC hotline Reporting of Potential Illegal impacts • Action Line powered by EQS is active: • https://efctc.integrityline.org • Webform can be completed in any language • Reporting of suspicious illegal actions can be done in full confidence • Use of the Action Line will be confidential and independently operated by the consultant • EFCTC members will have no access to individual reports • Further information: https://www.fluorocarbons.org/ Title of Presentation 32
We need your help Basic immediate first steps • Register on the HFC Registry – your main tool for controlling product flows • Setup a Database for tracking product flows: imports/exports/local use/stockpiling • Increase controls, and notify your authorities and DG CLIMA of any suspicious activity: CLIMA-HFC-REGISTRY@ec.europa.eu • Check key Product codes at Customs (both EU and UN codes) • R134a, R404A, R410A, R32, R125 • Create a “Positive List” of responsible companies 33 Confidential
Conclusion – we have work to do! Together, we can have an impact on illegal trade • Many actions can happen today • Collaboration across all players: • At National level and in the region • EU Commission support • Industry support • We are here to listen • We need your local experience to better help you Title of Presentation 34
Contacts EFCTC – European Fluorocarbons Technical Committee Cefic – The European Chemical Industry Council Rue Belliard 40, Box 15 B-1040 Brussels, Belgium http://www.fluorocarbons.org/
Any questions?
Framework – Phase down The European F-Gas Regulation and other legal regulations are forcing a rethink within the HVAC & R industry: The refrigerants that currently dominate the market, such as R404A, R410 A and R134, the so-called hydrofluorocarbon's (HFCs), have to be gradually phased down by 2030! Refrigerants with a higher GWP value will be replaced be more environmentally friendly alternatives, such as flammable refrigerants. This will be accomplished to: New and longer term product solutions, that deliver equal and better cooling performance, but a lower GWP (global-warming potential) for new equipment's Supporting the market to adapt new technologies through training and awareness especially about the safe use of flammable solutions 17/04/2019 38
Framework – High relevance! Lack of individual advice: The market – decision makers, planners and operators – does not have the necessary individual solutions to be able to make the right short-term (refilling) and long-term decisions (new installation) within the prescribed time. Hight relevance for the HVAC & R industry: without solutions, the F-Gas Regulation cannot be implemented adequately! 17/04/2019 39
Coolektiv – Shaping change together. Industry experts developing solutions. The expert committee On the initiative of the Westfalen Group, experts from companies and institutions of all relevant market participants have joined forces. Within two years, solutions for the refrigerant market will be generated and made available to support the market. Every market perspective – whether a specialist company, manufacturer, operator, dealer or trade association – should be included. The aim is to illuminate and answer relevant questions on many different levels. 17/04/2019 40
Coolektiv market launch in October 2018 Panel discussion in front of 150 guests: as part of the Chillventa on the evening of the first day of the trade fair in Nuremberg Audience participation Subsequent survey of promoters: Guests commented very positively on the Coolektiv initiative and showed great interest in participating in further expert committee information events 17/04/2019 41
COOLEKTIV participants – initiated by the Westfalen Group Wolfgang Zaremski – Sebastien Casterman – Asercom AISBL Honeywell Deutschland GmbH Heribert Baumeister – Federal Guild Burkhard Rüßmann – Association (BIV) of the German L&R Kältetechnik Refrigeration Trade Egon Schrezenmaier – Laurent Zielezinski – Schrezenmaier Kältetechnik Chemours International GmbH & Co. KG Operations Sàrl Harald Conrad – Westfalen AG 17/04/2019 42
Goals of Coolektiv To identify the problems/challenges of the industry By compiling & evaluating existing market intelligence To prioritise and evaluate problems/challenges Expert committee & event formats (inclusion of other market participants) Develop solutions and tools for the market Expert committee To perform preliminary tests Market test & event formats (inclusion of other market participants) To make solutions and tools available to the market Implementation & publication by participants of the expert committee 43 17/04/2019
Market-relevant focus topics and working committees Policy Operators Training and and planners further Illegal placing on System concepts / education the market of refrigerants Normative refrigerants DIN standards / Security / insurance guidelines 17/04/2019 44
Work results and next steps 13.11.2018: Expert 18.01.2019: Expert 18.01.2019: Political March 2019: Political committee meeting, committee meeting, Neu- committee action committee action Dortmund Isenburg Definition of the relevant Cover letter on the illegal Development of three 2. Cover letter sent to topics / working placing on the market of focus topics customs offices, customs committees: refrigerants to the investigation offices and Definition of next steps Policy European Commission labour inspectorates on Operators & and politically responsible Discussion about the illegal placing on the planners institutions collaboration with VDKF market of refrigerants Training and further Supersmart, Mr Jeschkeit Feedback from the Various feedback education & Mr Egly European Commission Press release Press release Press release 45 Sample slides 17/04/2019
Work results and next steps 02.04.2019: EHI Refrigeration 10.04.2019: EFCTC 15.04.2019: EPEE F-Gas April 2019: Exclusive Technology WG, presentation meeting, presentation of round table, presentation interview KKA of COOLEKTIV COOLEKTIV of COOLEKTIV Exclusive interview in the Mr Casterman Mr Zielezinski/Mr Gerstel Mr Zaremski (Asercom) KKA with Mr Kemler, Mr (Honeywell) and Mr (Chemours) present presents COOLEKTIV and Zaremski & Mr Zielezinski Rössling (REWE) present COOLEKTIV and outline outlines the measures for on the illegal placing on COOLEKTIV, the measures for combating the import of the market of refrigerants presentation of case combating the import of illegal refrigerants studies illegal refrigerants After publication: Interview to be sent to entire refrigeration/air- conditioning press 46 Sample slides 17/04/2019
Work results and next steps 16.04.2019: EPEE F-Gas 08.05.2019: Expert 07.11.2019: COOLEKTIV working group, presentation committee meeting, Event, Grand Hall of COOLEKTIV Münster Zollverein, Essen Mr Zaremski (Asercom) to Development of further Presentation of the present the initiative and content and measures previously developed outline the measures for solutions / measures combating the import of Coordination of results with all experts Evaluation and further illegal refrigerants elaboration of solutions / Definition of next steps measures Press release Press release 47 Sample slides 17/04/2019
Events – The market is also participating in development COOLEKTIV is in a constant dialogue with the market This permits the best possible resolution and overcoming of market-relevant problems and challenges. At events, the market participants should evaluate the solutions developed so far, test them and provide a new and important impetus for further development. In cooperation with the market participants, COOLEKTIV will develop the best (individual) solutions for the market! Save the date, 07.11.2019 in the Grand Hall Zeche Zollverein in Essen! 17/04/2019 48
Contact Jeannine Daniels & Evelin Stusek Tel. 0049-251 695-934 / -144 coolektiv@westfalen.com
Any questions?
HFC phase-down implementation: from a global perspective Didier Coulomb, International Institute of Refrigeration
EPEE F-GAS ROUNDTABLE MONDAY 15 APRIL, 2019 HFC PHASE-DOWN IMPLEMENTATION: FROM A GLOBAL PERSPECTIVE Didier COULOMB Director General INTERNATIONAL INSTITUTE OF REFRIGERATION (IIR) ― www.iifiir.org www.iifiir.or 53 g
The Kigali amendment Entered into force in January 2019 Creates several categories of countries: →Developed countries, the EU is a pioneer →Developing countries, except Gulf countries and some South Asian countries →Other developing countries →Hot countries (stationary air conditioning) www.iifiir.or 54 g
A5 countries A5 countries A2 countries (Group 1)** (Group 2)*** Baseline 2011-2013 2020-2022 2024-2026 Formula Average HFC Average HFC Average HFC consumption consumption consumption HCFC 15% or 25% baseline* 65% baseline 65% baseline Freeze - 2024 2028 1st step 2019 – 10% 2029 – 10% 2032 – 10% 2nd step 2024 – 40% 2035 – 30% 2037 – 20% 3rd step 2029 – 70% 2040 – 50% 2042 – 30% 4th step 2034 – 80% Plateau 2036 – 85% 2045 – 80% 2047 – 85% * Belarus, Russia, Kazakhstan, Tajikistan, Uzbekistan ** Group 1: Article 5 parties not part of Group 2 *** Group 2: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, United Arab Emirates, India, Iraq, Iran, Pakistan www.iifiir.or g
Various willingnesses initially, thus various obligations But finally, a real ambition almost all over the world Examples: ‒India: R32, hydrocarbons … ‒Saudi Arabia: district cooling … US case Everywhere, however, the energy issue : A key discussion within the Montreal Protocol bodies A need for internal cooperation to define a national strategy: the Paris agreement www.iifiir.or 56 g
The EU is in advance illegal trade… But other regions start to change →An opportunity for EU companies →However, an adaptation is necessary: each country is different. We cannot simply export our models: ex: CO2 as a refrigerant. →Cooperation UNE – R. Gluckman →Presence of EPEE in international conferences: UN conference, IIR Congress … www.iifiir.or 57 g
25th IIR International Congress of Refrigeration 2019 www.iifiir.or g
Thank you! Questions? Didier Coulomb, Director general iif-iir@iifiir.org INSTITUT INTERNATIONAL DU FROID | INTERNATIONAL INSTITUTE OF REFRIGERATION www.iifiir.org | iif-iir@iifiir.org | | | | #refrigeration www.iifiir.or 59 g
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Closing remarks Andrea Voigt, EPEE
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