Natural Refrigerants Market Size Forecast to Reach $1.3 Billion by 2026

(I-BusinessNews.Com, July 22, 2021 ) Natural Refrigerants Market size is forecast to reach $1.3 billion by 2026, after growing at a CAGR of 4.5% during 2021-2026. Natural refrigerants are chemicals that occur in nature’s biochemical processes. In addition, natural refrigerants, such as ammonia, carbon dioxide, with hydrocarbons, make no or only a small contribution to global warming as compared with the fluorinated refrigerants commonly available on the market, this is driving the market growth for natural refrigerants market. Transitioning to climate-friendly natural refrigerants is one of the most effective ways to permanently reduce greenhouse gas emissions and this is considered to be one of the most cost-effective climate mitigation strategies available. However, the risk of using flammable natural refrigerants can drop the market growth for natural refrigerants.

COVID Impact

The COVID-19 pandemic has created endless disruptions to the manufacturing or production industries due to a shortage of resources in various parts of the world. Due to the lockdowns around the world, there has been a serious impact on the distribution chains. COVID-19 has influenced foreign commerce, exports and imports, and has also contributed to a major decrease in demand in the industry. The major companies operating on the market try to clear their stock and concentrate on keeping their cash balances. The companies have also stopped investing in the newer R&Ds and relying on the existing products. Hence, the natural refrigerants market has declined during this time.

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Natural Refrigerants Market Segment Analysis – By Gas

The carbon dioxide segment holds the largest share in the natural refrigerants market in the year 2020 and is expected to grow at a CAGR of 4.6% during the forecast period. Carbon dioxide (CO2) is a colorless fluid, heavier than air at normal conditions and odorless at low concentrations. Being a non-flammable and non-toxic substance, it is classified as a high-quality refrigerant. The effect of Co2 based refrigerant on the ozone layer is null, having an ODP (Ozone Depletion Potential) value of 0. However, it can be considered that it does not contribute to climate change, as is obtained as a by-product from industrial processes and would otherwise be emitted into the atmosphere. Carbon Dioxide is used as an alternative to synthetic refrigerants, it is one of the most popular gases which is used for supermarket refrigeration. Whereas its other applications include heat pump water heaters, commercial refrigerated vending machines, secondary expansion systems, industrial and transport refrigeration systems, or vehicle air-conditioning systems. Thus, with the growing demand for refrigeration, the natural refrigerants market is expected to grow.

Natural Refrigerants Market Segment Analysis – By Application

The refrigerators sector has been the primary market for natural refrigerants in the year 2020 and is expected to grow at a CAGR of 4.9% during the forecast period. It consists various types such as Industrial, domestic, and others. For a better future, there is an immediate demand to look for clean refrigerants which are eco-friendly. The world is now looking for the refrigerants which do not contribute to ozone layer depletion and global warming, this has influenced the demand for the use of natural refrigerants such as CO2, NH3 and hydrocarbons which are vastly used in refrigerators. According to the IndustryARC experts insights, in the year 2020, the refrigerators production was 193.4 million unit. So, with the growing public interest and demand for domestic refrigerators, the natural refrigerant market is expected to grow in the upcoming years.

Natural Refrigerants Market Segment Analysis – By Geography

Europe has dominated the natural refrigerants market in the year 2020 and is expected to grow at a CAGR of 4.7% during the forecast period. Europe is attributed to the stringency in environmental legislations that have restricted the use of hydrofluorocarbon (HFC) and hydrochlorofluorocarbons (HCFC) refrigerants and has increased the demand for natural refrigerants. Europe is also projected to be the fastest-growing region in the market due to the high rate of natural refrigerant adoption by the end users in the region. Also due to the better financial state of people as compared to the other region the refrigerants market is expected to grow in this region. Natural refrigerants provide higher energy efficiency, low leakage rate and have lower refrigerant cost than fluorocarbons. Whereas according to the Air Conditioning and Refrigeration European Association (AREA), the European association of refrigeration, air conditioning and heat pump (RACHP) contractors, the annual turnover has approached $26.27 (€23) billion in 2020. The rising turnover shows the growing demand for natural refrigerants.

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Natural Refrigerants Market Drivers

Cost Effective

Natural refrigerants are inexpensive to produce, have long-term availability and enable efficient operation of refrigeration and air-conditioning systems. Although ammonia is an excellent fluid for refrigeration, and could be employed for heat pumping too (although with limitations due its high discharge temperature) its utilization is complex and in practice, it is only cost-effective for large capacity units in the industrial refrigeration and district heating sector.

Implementation of Stringent Environment Regulations

According to EPA (United Sates Environmental Protection Agency), in the United States, ozone-depleting substances (ODS) are regulated as class I or class II controlled substances. Class I substances, such as chlorofluorocarbons (CFCs) and halons, have a higher ozone depletion potential and have been phased out in the U.S, with a few exceptions, this means no one can produce or import class I substances. Class II substances are all hydrochlorofluorocarbons (HCFCs), which are transitional substitutes for many class I substances. New production and import of most HCFCs were phased out as of 2020. So, regulations like these are expected to drive natural refrigerants market.

Natural Refrigerants Market Challenges

Risk with Flammable Refrigerants

Using a flammable gas often comes with a chance. In many homes around the world, flammable gases are used for cooking, propane or natural gas, or heating. However, the aim of a heat pump that uses a flammable refrigerant is to hold the refrigerant in a hermetically sealed system. In comparison to refrigerators with IEC standards allowing up to 150 grams of flammable refrigerant, heat pumps with a charge of more than 150 grams have no practical standards. Some authorities have determined that the risk of using flammable refrigerants is reasonable if certain precautions are taken. Depending on the size of the room the charge might be limited. Ventilation of the heat pump installation room must be secured. In case of leakage there may not be any components that can ignite under normal conditions.

Natural Refrigerants Market Landscape

Technology launches, acquisitions and R&D activities are key strategies adopted by players in the Natural Refrigerants market. Major players in the natural refrigerants market are Airgas, Inc.,The Linde Group, A-Gas International, Hess Corporation, Sinochem, General Utilities, Puyang Zhongwei Fine Chemical Co.Ltd., HyChill, Engas Australasia, Tazzetti SpA, among others.

Acquisitions/Technology Launches

In August 2019, German industrial gases maker Linde AG has completed its sell of South India business to Japan’s Air Water Inc. (AWI) as part of a deal to complete its global merger with US-based Praxair Inc.

In March 2019, Airgas has completed the acquisition of TA Corporate Holdings, Inc. (“Tech Air”), a large independent distributor of industrial gases and welding supplies serving various geographies in the United States.

Key Takeaways

Asia-Pacific dominates the natural refrigerants market owing to increasing demand from various applications in domestic, industrial refrigerators.

The growing concerns towards global warming are likely to aid in the market growth of natural refrigerants market.

Natural Refrigerants works as alternatives for chlorofluorocarbon (CFCs), hence its demand in refrigerators and air conditions are rising, this tends to drive the market demand for natural refrigerants.

The risk with flammable natural refrigerants will create hurdles for the natural refrigerants market.

Related Reports :

A. Refrigerant Market

https://www.industryarc.com/Report/11662/refrigerant-market-analysis.html

B. HFC Refrigerants Market

https://www.industryarc.com/Report/1293/hfc-refrigerants-market-analysis.html

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