Low Global Warming Potential (GWP) Refrigerants Market Summary

The Montreal Protocol
The Montreal Protocol on Substances that Deplete the Ozone Layer is the landmark multilateral environmental agreement that regulates the production and consumption of nearly 100 man-made chemicals referred to as ozone depleting substances (ODS). When released into the atmosphere, those chemicals damage the stratospheric ozone layer, Earth’s protective shield that protects humans and the environment from harmful levels of ultraviolet radiation from the sun. Adopted on 16 September 1987, the Protocol is to date one of the rare treaties to achieve universal ratification.
The Montreal Protocol phases down the consumption and production of the different ODS in a step-wise manner, with different timetables for developed and developing countries (referred to as “Article 5 countries”). Under this treaty, all parties have specific responsibilities related to the phase out of the different groups of ODS, control of ODS trade, annual reporting of data, national licensing systems to control ODS imports and exports, and other matters. Developing and developed countries have equal but differentiated responsibilities, but most importantly, both groups of countries have binding, time-targeted, and measurable commitments.
Phase out of HCFCs – the Montreal Amendment
Hydrochlorofluorocarbons (HCFCs) are gases used worldwide in refrigeration, air-conditioning and foam applications, but they are being phased out under the Montreal Protocol since deplete the ozone layer. HCFCs are both ODS and powerful greenhouse gases: the most commonly used HCFC is nearly 2,000 times more potent than carbon dioxide in terms of its global warming potential (GWP). Recognizing the potential benefits to the Earth’s climate, in September 2007 the Parties decided to accelerate their schedule to phase out HCFCs. Developed countries have been reducing their consumption of HCFCs and will completely phase them out by 2020. Developing countries agreed to start their phase-out process in 2013 and are now following a stepwise reduction until the complete phase-out of HCFCs by 2030.
In Article 5 countries, this HCFC phase-out is in full swing, with support from the Multilateral Fund for the implementation of multi-stage HCFC Phase out Management Plans (HPMPs), investment projects and capacity building activities. Throughout this process, the Parties are encouraging all countries to promote the selection of alternatives to HCFCs that minimize environmental impacts, in particular impacts on climate, as well as meeting other health, safety and economic considerations. For the climate consideration, this means taking global-warming potential, energy use and other relevant factors into account. For refrigeration and air conditioning, this means optimizing refrigerants, equipment, servicing practices, recovery, recycling and disposal at end of life.
Phase down of HFCs – the Kigali Amendment
Another group of substances, hydrofluorocarbons (HFCs), were introduced as non-ozone depleting alternatives to support the timely phase-out of CFCs and HCFCs. HFCs are now widespread in air conditioners, refrigerators, aerosols, foams and other products. While these chemicals do not deplete the stratospheric ozone layer, some of them have high GWPs ranging from 12 to 14,000. Overall HFC emissions are growing at a rate of 8% per year and annual emissions are projected to rise to 7-19% of global CO2 emissions by 2050. Uncontrolled growth in HFC emissions, therefore, challenges efforts to keep global temperature rise at or below 2°C this century. Urgent action on HFCs is needed to protect the climate system.
The Parties to the Montreal Protocol reached an agreement at their 28th Meeting of the Parties on 15 October 2016 in Kigali, Rwanda to phase down HFCs. Countries agreed to add HFCs to the list of controlled substances and approved a timeline for their gradual reduction by 80-85 per cent by the late 2040s. The first reductions by developed countries are expected in 2019. Developing countries will follow with a freeze of HFC consumption levels in 2024 and in 2028 for some nations.
The issue has been under negotiation by the Parties since 2009 and the successful agreement on the Kigali Amendment (Decision XXVIII/1 and accompanying Decision XXVIII/2) continues the historic legacy of the Montreal Protocol. The Kigali Amendment will enter into force on 1 January 2019 for those countries that have ratified the amendment.
The pathway to implement the HFC phase down is to reduce dependency on high-GWP alternatives and increase the adoption of low-GWP, energy-efficient technologies as part of the HCFC phase-out process under the Montreal Protocol. Such a “smart approach” can achieve the Montreal Protocol’s objective of eliminating HCFCs while at the same time achieving energy efficiency gains and CO2 emissions reduction — a “climate co-benefit.”
The market for Low Global Warming Potential (GWP) refrigerants is undergoing a significant transformation driven by stringent regulatory frameworks, environmental concerns, and technological advancements. As global awareness of climate change intensifies, regulations such as the Kigali Amendment to the Montreal Protocol and the European Union’s F-Gas Regulation are mandating reductions in the use of high-GWP refrigerants like HFCs, propelling the shift towards alternatives with lower GWP. This regulatory pressure is fostering a rapid adoption of low-GWP refrigerants across various sectors including commercial, industrial, and residential refrigeration. Among the prominent low-GWP alternatives are hydrofluoroolefins (HFOs), which, such as HFO-1234yf, offer significantly reduced GWP compared to traditional HFCs, and are increasingly used in automotive air conditioning and other applications. HFC replacements like R32 (Difluoromethane) and R-152a are also gaining prominence. R32, with a GWP of around 675, is a direct and efficient replacement for higher-GWP refrigerants like R410A in air conditioning systems, while R-152a, with a GWP of 138, is used in specific applications where lower environmental impact is crucial, despite its flammability. Additionally, natural refrigerants like carbon dioxide (CO2), ammonia (R-717), and hydrocarbons (e.g., propane R-290) are gaining traction due to their negligible or zero GWP and high efficiency, making them suitable for diverse applications from commercial refrigeration to industrial processes. Technological advancements are also playing a crucial role in facilitating this transition, with innovations improving the efficiency, safety, and applicability of low-GWP refrigerants. For example, new system designs and refrigerant blends are enhancing the performance of low-GWP options and addressing challenges such as high pressures or flammability. The market is experiencing robust growth, driven by both regulatory compliance and the pursuit of sustainability. This growth is further supported by increasing investment in research and development, aimed at optimizing the performance and expanding the applications of low-GWP refrigerants. As industries and governments align with more ambitious climate goals, the trend towards low-GWP refrigerants is expected to continue accelerating, reshaping the refrigeration and air conditioning landscape with a focus on reducing environmental impact and enhancing energy efficiency.
Low Global Warming Potential (GWP) Refrigerants
Global and regional regulations are the primary drivers for the adoption of low-GWP refrigerants. Agreements like the Kigali Amendment to the Montreal Protocol, which mandates a global phase-down of HFCs, are pushing countries to reduce their reliance on high-GWP refrigerants. In the European Union, the F-Gas Regulation strictly limits the use of high-GWP refrigerants, further accelerating the transition. Similar initiatives in the U.S., Japan, and other regions are enforcing the shift to more sustainable refrigerant solutions.
As concerns over climate change grow, there is increasing pressure on industries to minimize their carbon footprints. Traditional HFC refrigerants contribute significantly to global warming due to their high-GWP values. Switching to low-GWP alternatives like HFOs, natural refrigerants (ammonia, CO2, hydrocarbons), and low-GWP HFCs (R32) allows companies to significantly reduce their greenhouse gas emissions.
Many low-GWP refrigerants, especially natural refrigerants and some HFOs, provide high energy efficiency, which leads to cost savings over time. This is particularly important in energy-intensive industries like refrigeration and air conditioning. The ability to combine environmental benefits with energy savings is a strong incentive for companies to make the switch.
One of the major challenges in adopting low-GWP refrigerants is the need to retrofit or replace existing refrigeration systems. Many low-GWP refrigerants, such as CO2 (R-744) or ammonia (R-717), require different system designs due to higher operating pressures or safety concerns like toxicity and flammability. This can result in significant upfront costs for companies, especially in industries with large refrigeration infrastructures.
Some low-GWP refrigerants, particularly natural refrigerants, pose safety challenges. Ammonia (R-717) is toxic, CO2 (R-744) requires high-pressure systems, and hydrocarbons like propane (R-290) and isobutane (R-600a) are flammable. Handling, storage, and system design need to adhere to strict safety standards, which increases the complexity and cost of adopting these refrigerants.
While low-GWP refrigerants often offer energy savings in the long run, the initial costs of adopting these technologies—whether through new systems or retrofitting—can be high. This financial barrier, especially for small and medium enterprises, slows the widespread adoption of low-GWP refrigerants.
Natural refrigerants like CO2, ammonia, and hydrocarbons are seeing increased adoption due to their minimal environmental impact and compliance with regulatory requirements. For example, CO2 (R-744) is being used in commercial refrigeration, particularly in supermarkets, while ammonia (R-717) is widely used in industrial refrigeration. These refrigerants offer long-term sustainability with zero or near-zero GWP.
Hydrofluoroolefins (HFOs) are increasingly being developed as replacements for high-GWP HFCs. HFOs, like HFO-1234yf, are widely used in the automotive and HVAC industries due to their ultra-low GWP and similar performance characteristics to HFCs. Additionally, HFC/HFO blends (e.g., R454B, R452A) are being used to balance system compatibility with lower GWP values, providing a transitional solution for industries that are not ready for full conversion to natural refrigerants.
The refrigeration and air conditioning industry is seeing rapid innovation in system designs that accommodate low-GWP refrigerants. For example, new technologies that safely handle the high pressures of CO2 (R-744) or mitigate the risks of flammable hydrocarbons are being developed. These advancements help improve system performance and safety, making low-GWP refrigerants more viable for a wider range of applications.
The combination of low-GWP refrigerants with energy-efficient system designs is becoming a significant trend. Refrigerants that not only have low environmental impact but also offer enhanced energy performance are in high demand. This is especially relevant in industries where refrigeration systems operate continuously, such as food processing, supermarkets, and cold storage facilities.

Refrigerant Trends
The F-gas regulation
The EU F-gas regulation is considered a front runner, preceding the Kigali Amendment to the Montreal Protocol and going beyond the latter. Explore the EU F-gas regulation and its impact on the refrigeration industry, including equipment bans, implications for heat pumps, and service bans.
HFC phase down
Discover sustainable refrigerant solutions and regulations driving the HFC phase-down. Specific market guidance and measures for reducing HFC consumption, including GWP limits, are spurring new technologies. The Montreal Protocol's Kigali Amendment aims to promote sustainable cooling solutions worldwide. Developed countries are phasing out HCFCs, with developing countries following until 2030. Governments are also implementing measures like GWP-weighted taxes and subsidies on low-GWP refrigerants to reduce high-GWP refrigerant consumption.
HCFC and CFC phase out
Learn about the global phase-out of HCFCs and CFCs, and the replacement with HFCs, which unfortunately also contribute to global warming. R22, a popular HCFC, is being phased out due to its minor ODS potential. Developed countries have already completed the phase-out, with others following until 2030.
Industry Chain Analysis
As we all know, with the introduction of more and more global environmental regulations and policies aimed at reducing the greenhouse effect of hydrofluorocarbons, the fourth-generation refrigerant HFO-1234yf has attracted much attention. This product has the characteristics of zero ozone potential (ODP), slightly flammable and low global warming potential (GWP). It is a new generation of ODS substitutes after hydrochlorofluorocarbons (HCFCs) and hydrofluorocarbons (HFCs) - hydrofluoroolefins (HFO). In recent years, with the EU's recognition of HFO-1234yf, HFO-1234yf is most likely to replace HFC-134a and become a new generation of automotive refrigerants. HFO-1234yf is mainly used in automobiles and refrigerators, and is also used in many large-scale fixed and commercial refrigeration equipment. At present, international chemical giants Chemours, Honeywell, and Arkema have accelerated the pace of building factories in China, and their future development prospects are worth looking forward to.
The current mainstream HFO-1234yf production processes are as follows:
①: HFO-1234yf is produced by the addition elimination method using hexafluoropropylene (HFP) as raw material;
②: HFO-1234yf is produced by the dehydrofluorination method using pentafluoropropane (HFC-245cb) as raw material;
③: HFO-1234yf is produced by the fluorine-chlorine exchange method using 2-chloro-3,3,3-trifluoropropene (HCFO-1233xf) as raw material;
④: Tetrafluoropropylene (HFO-1234yf) is produced by high-temperature cracking of methyl chloride and tetrafluoroethylene (TFE) as raw materials;
⑤: Tetrafluoropropylene (HFO-1234yf) is produced by using a mixture of hexafluoropropane (HFC-236ea) and pentafluoropropane (HFC-245eb) as raw material;
The main suppliers of hexafluoropropylene and trifluoropropylene are: Zhejiang Huanxin Fluoro Material, Zhejiang Sanhuan, Sinochem, etc. Major customers: General Motors, NIO, Volvo, Walmart, Hisense, Cryogiam, Art Serf, Pure Harvest Smart Farms, Trane, Midea, Daikin, Carrier, Johnson Controls, Rheem, BOHNETC.

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