R22 Refrigerant Market is forecast to reach $1567.44 million by 2025, after growing at a CAGR of 4.5% during 2020-2025. The R22 refrigerant market is driven by refrigeration and air-conditioning application across a wide range of temperatures. R22 refrigerant has been used as a substitute of chlorofluorocarbon (CFC) after phase out, which has propelled the demand for R22 refrigerant across various segment.
- Asia-Pacific dominates the R22 refrigerant market owing to strong consumption of air conditioners in China, Japan, and other developing countries.
- The refrigerant industry is focusing towards the alternative to the Ozone Depleting refrigerant. As the industry faces the regulations to phase out Ozone Depleting Substances under the Montreal Protocol.
HVAC Device – Segment Analysis
Air conditioner held the largest share in the R22 refrigerant market in 2019. In 2018, the global demand for Air conditioner 110.97 million units which was the same as previous year according to The Japan Refrigeration and Air Conditioning Industry Association (JRAIA). The main market for air conditioners were Japan, China, Europe, and North America. In China the demand for air conditioners reached 44.63 million units in 2018 and demand occupies 40.2% of the overall world demand. According to International Energy Association (IEA) U.S. and China accounts for half of the world’s stock of air conditioners. With the rising population growth, climate condition, falling equipment prices and urbanization, the number of air-conditioning units installed globally is set to jump from about 1.6 billion to 5.6 billion according to IEA. The rise in utilization of air-conditioning units will fuel the demand of R22 refrigerant to be incorporated into air conditioners.
Application – Segment Analysis
Residential and light air conditioning has been the primary market for R22 refrigerant. Global warming caused by greenhouse emissions has raised the temperature and has become one of the major factors behind the increasing demand for HVAC. In 2018, carbon emission rose by 2%, the fastest pace in seven years. The extreme weather in 2018 resulted in increased demand for air conditioning, according to BP Plc in its annual energy sector review. Building Services Research and Information Association (BSRIA) stated that Residential and light air conditioning will have a modest growth due to urbanization and a rise in people’s purchasing power.
Geography – Segment Analysis
APAC dominated the R22 refrigerant market with a share of more than 41%, followed by North America and Europe. Globally China is the second largest market in commercial air conditioning after North America whose demand reached 2.48 million units in 2018. The third largest market is Asia, excluding Japan and China whose demand reached 1.70 million units. It was followed by Europe with 0.78 million units and Middle East with 0.6 million in 2018 according to The Japan Refrigeration and Air Conditioning Industry Association (JRAIA).
According to Building Services Research and Information Association (BSRIA) the revenue of air conditioning in U.S market rose by more than 14% in 2018 to reach $20.4 billion. BSRIA has estimated that the air conditioning market will see growth of just under 4% in terms of volume but over 8% in terms of value, to exceed $22bn this year. On the commercial side in the U.S., the market is seeing a higher penetration of air conditioning which will have a positive impact on the R22 refrigerant market.
Drivers – R22 Refrigerant Market
- Wide application of R22 refrigerant.
Montreal Protocol (1987), refrigerant R22, the generally accepted and most suitable refrigerant for air conditioners. At present R22 is extensively used in the industries for liquefaction of the gases like chlorine, for supplying chilled water to various processes, machines, chillers of central air conditioning systems, and others. R22 is non-toxic, making this refrigerant highly safe for domestic and industrial purposes is non-flammable.
Challenges – R22 Refrigerant Market
- The substitutes of R22 refrigerant can hamper the market.
Air conditioners transfer heat while circulating refrigerant between the indoor and outdoor units. R-32 is a new refrigerant currently receiving the most interest as R32 can efficiently conveys heat and can reduce electricity consumption up to approximately 10% compared to that of air conditioners using refrigerant R-22. Furthermore compared to the refrigerants widely used such as R-22 and R-410A R-32 has a one-third lower global warming potential (GWP) and is noteworthy for its low impact on the environment.
- Stringent environmental regulation
R22 is a single component refrigerant used traditionally across medium and low temperature refrigeration. But it have some severe impact on the environment which has forced the government to put forward stricter regulations. Regulations have increasingly become stricter from greater consideration for the global environment because of the Montreal Protocol in 1987 and the Kyoto Protocol in 1997, resulting in a shift to refrigerants with even lower environmental impact.
Technology launches, acquisitions and R&D activities are key strategies adopted by players in the R22 refrigerant market. In 2019, the market of R22 refrigerant has been consolidated by the top five players accounting for xx% of the share. Major players in the R22 refrigerant Market are Airgas Refrigerants Inc., Arkema, Chemours, Linde Gas, Honeywell, Daikin Industries, and DuPont Chemicals, among others.
- In August 2017, Hudson Technologies acquired Airgas-Refrigerants, Inc. in a transaction valued at approximately $220 million. The acquisition will enhance the product portfolio, geographic presence, customer base and broaden sales and distribution capabilities significantly.
- In November 2018, Daikin Industries Ltd. acquired Austria-based refrigeration company, AHT Group. The acquisition was valued at €881 million ($1,040.42 million). The acquisition has strengthen in expanding Daikin’s commercial refrigeration business in Europe.
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