Low GWP Refrigerants Market size is poised to reach USD 86 Billion by the end of 2035, growing at a CAGR of 12% during the forecast period, i.e., 2023-2035. In the year 2022, the industry size of low GWP refrigerants was USD 22 Billion. The reason behind the growth is impelled by the rising demand for air conditioners for homes and workplaces. The change in climate during summer increases the temperature of the climate and to reduce this heat people buy air conditioners, and cooling fans as air conditioners reduce the heat inside the room by circulating cool air. Even companies buy air conditioners to maintain the temperature of the rooms and the systems i.e. computers and CPUs.
According to statistics, there are more than 1 billion heating, ventilation, and air conditioning (HVAC) units worldwide, and this number will increase by over 5 million by 2030.
The rising concern about global warming is believed to fuel the market growth. Hydrochlorofluorocarbon (HCFC) and chlorofluorocarbons (CFC) are two substances with high GWPs that can trap heat in the lower temperature resulting in climate change and global warming. As a result, there has been a shift in consumer preference for appliances with low GWP refrigerants such as carbon dioxide, ammonia, hydrocarbons, and HFOs as they are more environmentally friendly and have lower global warming potential. For instance, wealthy countries have produced the majority of the world's HFC emissions, which are anticipated to increase threefold by 2030.
Base Year Market Size (2022)
~ USD 22 Billion
Forecast Year Market Size (2035)
~ USD 86 Billion
A refrigerant used in vehicles' air conditioning systems makes a significant contribution to the greenhouse effect and to reduce this effect low-GWP refrigerants such as HFO-1234yf are used in the air conditioning systems which could greatly lessen the total equivalent warming impact.
According to data, over 70% of hydrofluorocarbon (HFCs) released globally come from the motor vehicle air conditioning, AC, and refrigeration industries.
Harmful Effects of Low GWP Refrigerants– Low GWP refrigerants are estimated to cause harmful effects on the environment therefore, people are choosing refrigerants with less toxicity, high performance, battery efficiency, low volumetric capacity, and ecofriendly product. This, as a result, is anticipated to hinder the growth of the market.
Type (Fluorocarbons, Hydrocarbons)
The hydrocarbons segment in the low GWP refrigerants market is estimated to gain a robust revenue share of about 70% in the coming years owing to the growing demand from the industrial sector. Hydrocarbons such as propane and isobutane are affordable, simple to acquire, and are frequently utilized as refrigerants in the industrial sector.
These refrigerants can be used for cooling industrial spaces since they provide efficient cooling performance and reduce the carbon footprint of the cooling systems. In addition, owing to their high-efficiency performance they have applications in chemical manufacturing and pharmaceutical processing.
Application (Commercial, Domestic, Industrial Refrigeration)
The commercial refrigeration segment in the low GWP refrigerants market is set to garner a notable share shortly owing to the increasing production of cold storage food items across the world. The commercial usage of refrigerators includes usage for storage of food, dairy products, juices, and frozen food, among others is necessary for preserving and distributing food while maintaining food nutrients. In many retail food refrigeration applications, refrigerants provide the best combination of efficiency, environmental friendliness, and safety, also help in maintaining near-zero downtime of the store applications, and reduce food losses by maintaining the precise temperature.
Moreover, international food companies encourage the use of propane refrigerant systems, and commercial refrigerators use the more recent hydrocarbon refrigerant R290 since it is becoming a favored refrigerant. For instance, switching to low GWP alternatives can significantly slow the rate of global warming as huge refrigeration systems can retain thousands of pounds of HFCs and frequently leak at a rate of over 18% per year. According to estimates, in 2022, frozen food sales in the United States reached over USD 70 billion.
Our in-depth analysis of the global market includes the following segments:
European Market Forecast
The low GWP refrigerants market in Europe is predicted to account for the largest share of about 37% by the end of 2035 impelled by the growing government initiatives to eliminate the utilization of HFC refrigerant. The European Parliament has set regulations such as fluorinated greenhouse gases (F-Gas) Regulation to prohibit the use of refrigerants with a global warming potential of more than 2500.
Under this regulation users of refrigeration and air conditioning equipment are subject to legal obligations and to primarily focus on preventing system leaks to reduce emissions. Further, the F-Gas regulation in Europe promotes the adoption of low GWP refrigerants and aims to reduce the EU's F-gas emissions by two-thirds in 2030.
Besides this, The EU's "Green Deal" is a European Commission's strategy to promote a circular economy, to make the EU carbon-neutral by 2050.
APAC Market Statistics
The Asia Pacific low GWP refrigerants market is estimated to be the second largest, during the forecast timeframe led by its international commitments to reduce greenhouse gas emissions. India joined the Kigali Agreement, to eliminate hydrofluorocarbons (HFCs), dangerous greenhouse gases used in air conditioning and refrigeration, and the country is expected to reduce its usage of HFCs by more than 80% by 2047.
In addition, in 2022 the Kigali Amendment (KA) to the Montreal Protocol has been ratified by Singapore, making it the 134th nation to reduce its HFC consumption by 80% over the following 20 years.
Author Credits: Smruti Ranjan, Rajrani Baghel