The Role Of Refrigeration and Air Conditioning in Energy Efficiency and GHG Emissions Reduction

The Role Of Refrigeration and Air Conditioning in Energy Efficiency and GHG Emissions Reduction

Air Conditioning and Refrigeration (HVAC&R) is obviously an important contributor to economic performance and the quality of life. It is seldom recognised as an industry and its contribution to energy consumption and Greenhouse Gas Emissions (GHG) is broadly misunderstood and understated.

The industry makes a central contribution to fundamental industries including the built environment, food production and distribution, healthcare and pharmaceuticals and virtually all other human activities. The importance of the HVAC&R industry in Australia is demonstrated by the following statistics:

  • 45 M individual installations
  • 2% of GDP, $26B annual spend, $ 6B capital investment PA, perhaps $100 B installed HVAC&R infrastructure at current $ value
  • 22% of electricity consumption 
  • 12/14 of national CO2e emissions (GHG emissions)
  • 20,000 firms, 170,000 direct employees, of whom about 70,000 are licensed to handle fluorocarbon refrigerants.

This same level of development is apparent throughout the industrialised world and is rapidly being realized in developing countries reflecting the fundamental role of HVAC&R in economic development. The industry offers major sources of energy efficiency and the resulting cost savings throughout the world.   

HVAC&R Climate Change Impact

The contribution of HVAC&R to greenhouse gas emissions is pervasively misunderstood and understated.

The energy consumption of the HVAC&R industry (indirect emissions) is extremely high (22.3% of electricity, about 10% of national emissions) reflecting the many operating systems and their continuous use. It is direct emissions that are little understood and pervasively misrepresented. The Australian national accounts report refrigerant emissions to be about 1% of national emissions. This dramatically understates the volume of direct emissions for a series of reasons that defy logic and give rise to a great deal of misunderstanding.

The real impact of the HVAC&R industry in Australia is in the order of 14% of national emissions. This is comprised of 10% of national emissions due to energy consumption and 4 % due to unintentional and intentional fluorocarbon refrigerant emissions.

This understatement matters a great deal. It has the effect of failing to recognise HVAC&R as a primary potential source of emissions reduction. It has the effect of failing to recognise that there are solutions available in Natural Refrigerants, for which direct emissions would be minimal. The natural refrigerants are highly energy efficient and therefore would contribute to reduced indirect emissions.  The use of natural refrigerants would eliminate direct GHG emissions and reduce indirect emissions by 20 to 50%, a potential total reduction in national emissions of 7%.

The Potential Role of Natural Refrigerants

The natural refrigerants are ammonia, carbon dioxide, hydrocarbons, air and water. These refrigerants are commercially proven and highly energy efficient when used in the right engineering context. They have been shown to be effective in meeting the wide range of refrigerant requirements by HVAC&R sector.

As a result their use can make a major contribution to HVAC&R energy efficiency and emissions reduction. The transition to NRBT (Natural Refrigerant Based Technologies) would virtually eliminating direct emissions because natural refrigerants have very low GWP and reduce indirect emissions by up to 50% through increased energy efficiency. The use of NRBT would pre-empt a major increase in GHG emissions in the developing world.  It is fundamental to recognise that the transition to NRBT will deliver major cost savings to end users of the HVAC&R services.  The potential cost savings in Australia are in the order of $ 8B per annum.


*Cold Hard Facts 2, Dept of the Environment, 2013 (A taxonomy of the HVAC&R industry)

This is the ARA’s estimate. Cold Hard Facts 2 says this is 11.7%. Contact ARA for explanation.

Contact the ARA for access to extensive files on the commercial use of NRBT