Forecast Period | 2025-2029 |
Market Size (2023) | USD 377.71 Million |
CAGR (2024-2029) | 2.75% |
Fastest Growing Segment | Carbon Dioxide |
Largest Market | United States |
Market Size (2029) | USD 445.71 Million |
Market Overview
The North America Natural Refrigerants Market was
valued at USD 377.71 Million in 2023 and is anticipated to project robust
growth in the forecast period with a CAGR of 2.75% through 2029. Conventional refrigerants,
including R407A, R410A, R134a, and R544, have significant potential to
contribute to global warming and ozone depletion. The escalating apprehension
regarding global warming and related environmental concerns stands as the
primary driving force behind the market's expansion. Natural refrigerants are
synthesized through a biochemical process that harnesses naturally occurring
resources. Among the most widely utilized natural refrigerants in HVAC/R
applications are carbon dioxide (CO2, R-744), hydrocarbons such as propane
(R-290), isobutene (R-600a), and propylene (R-1270), as well as ammonia (NH3,
R-717). Additionally, water (H2O, R-718) and air (R-729) are among other
natural refrigerants in use.
These natural refrigerants are considered the
ultimate solution to mitigate the environmental harm caused by synthetic
refrigerants, primarily due to their extremely low or non-existent global warming
potential (GWP) and zero ozone depletion potential (ODP) result in driving the
growth of the North America Natural Refrigerants Market in the forecast period.
Key Market Drivers
Growing Demand for Sustainability
As the world intensifies its efforts to combat
climate change and embrace sustainable practices, there is a growing demand for
environmentally friendly solutions across diverse industries. In North America,
the adoption of natural refrigerants is witnessing a substantial increase as
businesses, policymakers, and consumers seek alternatives to traditional
synthetic refrigerants, which have been associated with detrimental
environmental consequences. This shift towards natural refrigerants reflects a
broader commitment to sustainability, energy efficiency, and the reduction of
greenhouse gas emissions. The escalating demand for sustainability in
refrigeration and cooling systems has propelled natural refrigerants to the
forefront. These substances, sourced from naturally occurring reservoirs,
exhibit significantly lower environmental impacts compared to synthetic
refrigerants notorious for their contributions to ozone depletion and global
warming. Various compelling factors contribute to the growing use
of natural refrigerants. The negative environmental effects of synthetic
refrigerants, particularly hydrofluorocarbons (HFCs), have raised widespread
concerns. These chemicals have been linked to ozone layer depletion and their
role in exacerbating climate change. Consequently, there is a pressing need to
seek greener and more environmentally responsible alternatives. International
agreements like the Kigali Amendment to the Montreal Protocol have spurred
action in multiple countries, including North America. Such agreements aim to
phase out refrigerants with high global warming potential (GWP) and promote the
adoption of low-GWP alternatives, such as natural refrigerants.
Natural refrigerants often demonstrate
higher energy efficiency compared to their synthetic counterparts. This
inherent efficiency can lead to reduced energy consumption and, consequently,
lower operational costs for businesses, reinforcing the economic viability of
natural refrigerants. With an increasing number of consumers prioritizing
environmentally conscious choices, there is a growing market demand for
sustainable products and services. This trend extends to refrigeration and
cooling solutions, encouraging businesses to embrace natural refrigerants to
meet consumer expectations.
The versatility of natural
refrigerants has led to their application in various sectors, including supermarkets,
restaurants, and convenience stores are increasingly adopting natural
refrigerants for cooling and storing products. This transition not only reduces
their carbon footprint but also aligns with their commitment to environmental
responsibility. Large industrial facilities are making the switch to natural
refrigerants for their cooling processes. This shift improves efficiency and
environmental performance, contributing to more sustainable operations. Natural
refrigerants are being explored for use in both residential and commercial air
conditioning systems. By doing so, they help maintain comfortable indoor
environments while minimizing their ecological impact. Therefore, increasing focus
on sustainability regarding the use of natural refrigerants led to the growth
of North America Natural Refrigerants Market.
Rising Demand of Natural Refrigerants in Commercial
Sector
The commercial sector plays a pivotal role in
shaping the demand for natural refrigerants, driven by a confluence of factors
that underscore the sector's growing commitment to sustainability and
environmental responsibility. As businesses, institutions, and enterprises seek
to reduce their carbon footprint and adopt more eco-friendly practices, the
adoption of natural refrigerants has become a prominent feature in the
commercial sector's transition towards greener and more sustainable cooling and
refrigeration systems. At the heart of this demand surge is an environmental
imperative. The detrimental effects of synthetic refrigerants, particularly
hydrochlorofluorocarbons (HCFCs) and hydrofluorocarbons (HFCs), have been
widely documented. These chemicals are notorious for their role in ozone layer
depletion and their significant contributions to global warming. In response to
these concerns, regulatory authorities have imposed stringent regulations aimed
at phasing out high-global-warming-potential (GWP) refrigerants, compelling
businesses to seek eco-friendlier alternatives. Natural refrigerants,
characterized by their minimal environmental impact, have emerged as the
preferred choice for many commercial entities.
Commercial refrigeration systems
encompass a wide range of applications, from supermarkets and grocery stores to
restaurants and convenience stores. In these settings, natural refrigerants
have found extensive use. For instance, transcritical CO2 systems, which
utilize carbon dioxide as a refrigerant, have gained popularity in large
supermarkets. These systems offer both excellent cooling performance and the
advantage of significantly lower GWP compared to HFC alternatives. Businesses
in the commercial refrigeration sector have recognized that embracing natural
refrigerants aligns with consumer expectations and regulatory requirements
while contributing to operational efficiency. Air conditioning systems in
commercial buildings, including offices, hotels, and shopping malls, are also
witnessing a shift towards natural refrigerants. Innovations in technology have
made it increasingly feasible to deploy natural refrigerants like hydrocarbons
(R-290 and R-600a) in air conditioning units, ensuring comfortable indoor
environments with minimal ecological impact. As businesses prioritize the
comfort and well-being of occupants while reducing their carbon footprint,
natural refrigerants have become a viable and sustainable choice for commercial
air conditioning.
Supportive Regulatory Scenario
In North America, the push for sustainability and
environmental responsibility has fostered the creation of a supportive
regulatory framework to promote the use of natural refrigerants. These
regulations are designed to reduce greenhouse gas emissions, safeguard the
ozone layer, and promote energy efficiency, thus driving the adoption of
natural refrigerants across various industries. This proactive approach aligns
with global efforts to combat climate change and transition towards more
environmentally friendly alternatives. Several regulatory measures, such as the
American Innovation and Manufacturing Act (AIM Act), enacted in December 2020,
focus on phasing out high-global-warming-potential (GWP) synthetic refrigerants
known as hydrofluorocarbons (HFCs). The AIM Act brings the United States in
line with the Kigali Amendment to the Montreal Protocol, establishing targets
for HFC phase-down and encouraging the transition to low-GWP alternatives,
including natural refrigerants.
The Environmental Protection Agency
(EPA) has implemented regulations under the Clean Air Act to control emissions
of ozone-depleting substances and high-GWP refrigerants. These regulations
mandate the use of eco-friendly alternatives, such as natural refrigerants, in
various applications like air conditioning and refrigeration. The
EPA's Significant New Alternatives Policy (SNAP) program evaluates and approves
substitute chemicals, including refrigerants, with a focus on identifying safe
and environmentally friendly alternatives. SNAP plays a crucial role in
promoting the adoption of natural refrigerants as replacements for high-GWP
synthetic refrigerants.
Government agencies like the Department of Energy
(DOE) establish energy efficiency standards for appliances and equipment,
including cooling and refrigeration systems. Natural refrigerants often surpass
these standards in terms of energy efficiency, further incentivizing their use.
As a result, the multitude of government initiatives related to natural
refrigerants is expected to drive demand in the North American Natural Refrigerants
Market in the forecast period.
Increasing Energy Efficiency
As North America strives to diminish energy
consumption and mitigate its environmental footprint, the adoption of natural
refrigerants is emerging as a strategic solution. These refrigerants not only
offer environmental benefits but also play a significant role in enhancing
energy efficiency across various sectors. Whether in commercial refrigeration
or air conditioning, natural refrigerants are ushering in a new era of
sustainable cooling that aligns with the nation's dedication to conserving
energy and safeguarding the environment. Energy efficiency is a fundamental
element of sustainable development, and North America recognizes its pivotal
role in addressing climate change and lowering energy expenditures. Derived
from environmentally friendly sources, natural refrigerants serve as a prime
illustration of how advancements in cooling technologies can effectively
address environmental concerns while achieving energy efficiency objectives.
Natural refrigerants boast several
advantages with regard to energy efficiency when compared to synthetic
counterparts like hydrofluorocarbons (HFCs). They possess substantially lower
Global Warming Potential (GWP), resulting in a diminished impact on global
warming, thus aligning with the country's emissions reduction objectives.
Moreover, natural refrigerants frequently exhibit superior thermodynamic
properties, leading to more efficient heat transfer and cooling processes.
This, in turn, can result in decreased energy consumption and reduced
operational expenses. The improved thermodynamic properties of natural
refrigerants can play a significant role in lowering energy demand, a
particularly critical factor in energy-intensive sectors such as air
conditioning and refrigeration. Thus, these factors dominate the growth of the North
America Natural Refrigerants Market in the forecast period.
Download Free Sample Report
Key Market Challenges
Limited Infrastructure & Availability
The lack of infrastructure to support the use of
natural refrigerants is another significant challenge. For example, the
availability of CO2 refrigerant suppliers and charging stations in North
America is not as extensive as that of synthetic refrigerants. This limitation
can hinder the widespread adoption of natural refrigerants, particularly in
remote or underserved areas. Moreover, the adoption of natural refrigerants
holds immense promise for a more sustainable and environmentally friendly
approach to cooling and refrigeration. However, one of the challenges in
transitioning to these alternatives is their limited availability. As
industries and governments prioritize sustainability and reduced carbon
footprints, addressing this challenge becomes crucial for a successful and
widespread adoption of natural refrigerants. The limited availability of
natural refrigerants can be attributed to several factors such as the
production and distribution of natural refrigerants may not be as established
or widespread as their synthetic counterparts, leading to limitations in supply,
regulations and standards governing the use of refrigerants vary across
regions. Some natural refrigerants might be restricted due to safety concerns
or lack of regulatory approval, some existing cooling and refrigeration systems
are designed to work with specific synthetic refrigerants, making it
challenging to retrofit them for natural refrigerants, and limited demand for
natural refrigerants in the past has resulted in a smaller market size, which,
in turn, impacts availability.
Safety Concern
Safety concerns associated with the use of natural
refrigerants are a critical challenge in the North America Natural Refrigerants
market. While natural refrigerants are generally considered safe when handled
correctly, they can pose risks if mishandled, especially in confined spaces or
poorly ventilated areas. For example, ammonia is known for its toxicity and
flammability, requiring rigorous safety measures in its use. Hydrocarbons can
be highly flammable, making proper storage and leak prevention essential.
Carbon dioxide systems operate at high pressures, necessitating robust
equipment design and maintenance.
Addressing safety concerns requires stringent
adherence to safety protocols, regular inspections, and ongoing training of
personnel. Enhanced safety standards and guidelines specific to natural
refrigerants should be developed and widely promoted which might hamper the
growth of North America Natural Refrigerants market in the projected period.
Key Market Trends
Regulatory Initiatives
One of the most significant drivers of the Natural
Refrigerants market in North America is the robust regulatory framework aimed
at curbing the use of synthetic refrigerants with high GWP. Governments and environmental
agencies have been instrumental in pushing for stricter regulations and
standards, aligning with international agreements like the Kigali Amendment to
the Montreal Protocol. This commitment has created a favorable environment for
the adoption of natural refrigerants. In the United States, the Environmental
Protection Agency (EPA) has implemented regulations that phase down the use of
hydrofluorocarbons (HFCs) while promoting the transition to low-GWP
alternatives. Similarly, Canada is actively pursuing measures to limit the use
of synthetic refrigerants. These regulations have propelled the adoption of
natural refrigerants, including carbon dioxide (CO2), ammonia (NH3), and
hydrocarbons (HCs), in various applications such as commercial refrigeration,
air conditioning, and industrial cooling.
Energy efficiency has become a paramount
concern in the cooling industry, driving the demand for natural refrigerants.
Natural refrigerants, particularly CO2 and ammonia, are known for their excellent
thermodynamic properties, resulting in more energy-efficient systems. In the
North America Natural Refrigerants market, there is a growing recognition that
environmentally friendly cooling solutions can also lead to significant energy
savings and operational cost reductions.
Commercial and industrial sectors are increasingly
adopting natural refrigerant-based systems to meet sustainability goals and
reduce their carbon footprint. Supermarkets, for instance, are transitioning to
CO2-based refrigeration systems due to their superior energy efficiency and
lower environmental impact. The combination of reduced emissions and
operational cost savings makes natural refrigerants an attractive choice for
businesses looking to align with green initiatives.
Advancement in Technology
The pursuit of sustainable and environmentally
friendly cooling solutions has driven remarkable advancements in the field of
natural refrigerants. As industries and researchers seek to address climate
change and reduce carbon footprints, technology has played a pivotal role in
making natural refrigerants more efficient, safe, and accessible. From improved
system designs to cutting-edge manufacturing processes, these advancements are
reshaping the way we think about cooling and refrigeration. Moreover, advanced
technologies are optimizing the performance of cooling systems that use natural
refrigerants. Innovations in heat exchangers, compressors, and system controls
enhance energy efficiency and overall system performance. Microchannel Heat
Exchangers which are compact and efficient heat exchangers improve heat
transfer and reduce refrigerant charge, contributing to more energy-efficient
systems. In addition to this, variable speed compressors that adjust their
speed based on cooling demands, providing precise and efficient cooling while
minimizing energy consumption.
Smart controls and Internet of Things
(IoT) technology is enabling remote monitoring and control of cooling systems,
optimizing their performance, and detecting issues in real-time. Transcritical
CO2 systems, for example, have become more efficient and cost-effective, making
them suitable for a wider range of applications, including hot climates.
Moreover, the development of advanced heat exchangers and controls has improved
the overall reliability and performance of natural refrigerant systems. This
technological evolution has accelerated the acceptance of natural refrigerants
in North America. Transport refrigeration is a particularly promising sector
where natural refrigerants are gaining traction. The use of ammonia-based
systems in refrigerated trucks and trailers is increasing, offering a
sustainable solution for cold chain logistics. Additionally, propane (R-290) is
making inroads in domestic refrigeration and small-scale air conditioning due
to its low GWP and energy efficiency.
Segmental Insights
Type Insights
Based on the type, the carbon
dioxide segment is expected to register the highest growth during the
forecast period 2025-2029. Carbon dioxide serves as an environmentally benign,
non-toxic, and non-flammable natural refrigerant. Possessing a Global Warming
Potential (GWP) value of 1, carbon dioxide serves as the benchmark for
evaluating the comparative environmental impact of various refrigerants on
global warming. As carbon dioxide is generated as a by-product of various
production processes, it is readily accessible for use as a refrigerant. This
accessibility contributes to the expansion of the North America Natural
Refrigerants Market in the projected period.
Application Insights
Based on the application,
the industrial segment is expected to register the highest growth during the forecast period, 2025-2029. The industrial sector encompasses
refrigeration systems utilized in extensive industrial settings, including
chemical manufacturing, pharmaceuticals, and food processing. Presently, carbon
dioxide refrigeration technology finds its primary applications in three key
areas: heat pumps, automotive air conditioning, and multi-stage refrigeration
systems. Given carbon dioxide's environmentally friendly nature, the development
and production of carbon dioxide compressors for diverse industries have been
undertaken. This development is expected to drive the expansion of the North
America Natural Refrigerants Market in the anticipated period.
Download Free Sample Report
Country Insights
The United States will witness the fastest growth during
the forecast period, 2025-2029. This is attributed to the widespread adoption
of natural refrigerants as government has been implementing regulations to
phase down the use of high-GWP synthetic refrigerants. For example, the
American Innovation and Manufacturing Act (AIM Act) aligns the country with the
Kigali Amendment to the Montreal Protocol, which sets targets for reducing HFC
emissions. This has led to a push for the adoption of natural refrigerants as
alternatives.
Recent Developments
- In January 2024, ALDI announced two groundbreaking sustainability milestones, advancing its goal to become the leading sustainable grocer in the country. First, ALDI achieved its target of eliminating all plastic shopping bags by the end of 2023, making it the first major U.S. retailer to remove plastic bags from its over 2,300 stores. This landmark move will prevent nearly 4,400 tons (approximately nine million pounds) of plastic from entering circulation annually. Second, ALDI set a new industry-leading objective to transition to natural refrigerants across all U.S. stores by the end of 2035. This initiative will ensure that as ALDI expands, it continues to maintain product freshness while supporting environmental sustainability. This new goal builds on the company’s existing use of eco-friendly refrigerants in over 600 stores, which has already helped reduce potential carbon emissions by nearly 60% each year.
- In March 2024, The New York State Department of Environmental Conservation (DEC) has announced the completion of two projects that effectively showcase the use of sustainable refrigerants as alternatives to climate-damaging greenhouse gas refrigerants. These projects, located at an ALDI store in Buffalo, Erie County, and a Walgreens in Islandia, Suffolk County, serve as models for future transitions to sustainable refrigeration in supermarkets and drugstores, particularly in underserved communities. The Climate Action Council Scoping Plan advocates for the phase-out of hydrofluorocarbons (HFCs), which are highly potent greenhouse gases, to achieve emission reductions in this sector. The successful implementation of these demonstration projects by Walgreens and ALDI will provide valuable insights for a statewide shift away from HFCs, support policy development, and contribute to New York’s emission reduction goals.
- In October 2023, PRO Refrigeration Inc., a leading innovator in refrigeration solutions, announced the launch of its cutting-edge PROGreen Hybrid Packaged Chiller System. This new system integrates two independent refrigeration units into a single packaged chiller. Notably, one unit uses all-natural CO2/R744 as its refrigerant, while the other employs R448, a synthetic refrigerant with a Global Warming Potential (GWP) below 1300. As industries globally seek to enhance environmental sustainability and reduce carbon footprints, the demand for eco-friendly refrigeration systems is increasingly pressing. PRO acknowledges the challenges customers face when adopting new or natural refrigerants and recognizes the need for effective, user-friendly solutions. The PROGreen Hybrid Solution is designed to simplify this transition by providing a reliable system that combines the advantages of a top natural refrigerant with one of the best synthetic refrigerants available on the market.
Key Market Players
- Emerson Electric Co.
- Airgas Inc.
- Daikin U.S. Corporation
- SWEP North America, Inc.
- Messer North America, Inc.
- National Refrigerants Inc.
|
By Type
|
By Application
|
By Country
|
- Carbon Dioxide
- Ammonia
- Hydrocarbons
- Others
|
- Industrial
- Commercial
- Domestic
|
- United States
- Mexico
- Canada
|
Report Scope:
In this report, the North America Natural
Refrigerants Market has been segmented into the following categories, in
addition to the industry trends which have also been detailed below:
- North America Natural
Refrigerants Market, By
Type:
o Carbon Dioxide
o Ammonia
o Hydrocarbons
o Others
- North America Natural
Refrigerants Market, By
Application:
o Industrial
o Commercial
o Domestic
- North America Natural
Refrigerants Market, By Country:
o United States
o Mexico
o Canada
Competitive Landscape
Company Profiles: Detailed analysis of the major companies
present in the North America Natural Refrigerants Market.
Available Customizations:
The North America Natural Refrigerants Market report
with the given market data, Tech Sci Research offers customizations according
to a company's specific needs. The following customization options are
available for the report:
Company Information
- Detailed analysis and
profiling of additional market players (up to five).
North America Natural Refrigerants Market is an
upcoming report to be released soon. If you wish an early delivery of this
report or want to confirm the date of release, please contact us at [email protected]