Thanks to dedicated efforts throughout the HVACR industry, almost everyone is now aware that we’ve begun a refrigerant transition driven by regulatory phasedowns of high-GWP HFC products. Most people are also aware that these phasedowns come with new opportunities to —through new equipment or retrofits — pursue solutions that will ultimately deliver enhanced performance while helping customers move away from legacy refrigerants.

However, fewer people are aware that along with these opportunities to do good for our industry and the planet, businesses face the danger of illegal refrigerant activity. Consider what happened in the European Union (EU) after HFC phaseouts began in 2015. According to the European Chemistry Industry Council, authorities in the EU seized hundreds of metric tons of illicit HFCs in 2019 and 2020.

To further illustrate why illegal refrigerant activities should be taken seriously across our industry, we can look to the 1990s. When phaseouts of CFCs escalated in the U.S., cocaine smugglers started using their routes and equipment to bring in illegal R-12. Believe it or not, the risk-reward for dealing in illegal refrigerants was more appealing than cocaine.

These events provide insights that can help us combat illegal activities as the AIM Act works to phase down HFC refrigerants. We experienced a 10% stepdown in HFCs in January under the AIM Act and are preparing for an additional 30% reduction in HFC production and consumption starting Jan. 1, 2024. Given the intended consequence of the AIM Act to reduce availability of certain HFCs, we can expect to see decreased supply for equipment service and maintenance. Furthermore, based on lessons of the past, this may increase the risk of illegal materials coming into the U.S. and Canada.

Many key players in our industry — including contractors, OEMs, refrigerant innovators, and manufacturers like Chemours — are investing in a smooth, successful transition away from HFCs to lower-GWP HFO-based refrigerants. Unfortunately, there are entities seeking to illegally capitalize on the situation. On the positive side, many influencers in our industry are making the effort to ensure everyone invested in HVACR is prepared to protect their people, customers, and businesses from illegal refrigerant activity. In addition, enforcement protocols are in place to discourage the activity.

The Concern

The overriding concern with illegal refrigerants is that you simply don’t know what is in that cylinder. Moreover, unless you are testing everything that comes into your shop or is used by your technicians — a highly time consuming and cost-prohibitive approach — you have no way of finding out until the damage is done. By damage, I mean potential physical and financial damage to your people, customers, and business; damage to your reputation; and damage to the environment. Let’s look at a few main factors driving significant concern about illegal refrigerants.

First, illegal imports can be extremely dangerous. Illegal products may have unknown flammable contents, such as hydrocarbons, impurities, and other contaminants. In addition, to increase profitability, individuals may mix the HFC with alternative refrigerants that are less expensive to buy. This creates significant safety risks for the technicians working with them and for the end user.

Secondly, poor quality can severely compromise equipment and performance. Chemours’ testing has demonstrated that the quality of illegal imports is poor at best, plus the AIM Act requires that all virgin or reclaimed refrigerant products sold in the U.S. meet AHRI 700 standards. System performance, energy efficiency, and overall system life can be negatively affected by poor-quality refrigerants.

Third, illegal refrigerants work against the environment — in essence, sabotaging what regional, national, and global phasedown efforts mean to achieve. The greater the influx of unregulated products into the market, the longer the delay in meeting climate objectives in the U.S., Canada, and elsewhere.

If you still don’t find these reasons concerning enough, consider the reputation and financial health of your business. Illegal imports are, in fact, illegal, and dealing with them can bring fines or worse. The EPA, in coordination with Customs and Border Protection and other agencies, has initiated enforcement protocols to stay ahead of illegal activities. Moreover, under the AIM Act in the U.S. and Ozone-depleting Substances and Halocarbon Alternatives Regulations (ODSHAR) in Canada, the import, distribution, and/or sale of illegally imported HFCs is subject to penalties, including confiscation, imprisonment, and fines.

What You Can Do

Increased risk of illegal activity is likely to persist as the phasedown of HFCs continues. While there is no single cure for ending these activities, learning from past events, such as those in the EU, has resulted in the development of stronger prevention and protection strategies. The AIM Act (EPA) and ODSHAR (Environmental Canada) are two manifestations of this. Other strategies include updates to refrigerant packaging. Chemours, for example, equips our cylinders with an anticounterfeiting security shrink sleeve, and single-use recyclable cylinders include an Izon® security label, which includes information you can use to check authenticity.

Protecting yourself from illegal refrigerants starts with your own awareness and being proactive in sourcing your products. My first rule is to only rely on a wholesaler with whom you have a proven relationship and to only use brands you trust. If you are unsure, do your homework and ask around to ensure you select a reputable refrigerants distributor for all purchases. In addition to following this golden rule, here are some other tips:

• Steer clear of an unbelievably low price, an “unlimited supply” suddenly becoming available in a market undergoing reduced production, internet deals, and other too-good-to-be-true situations;
• Make sure any price you receive for a refrigerant aligns with current industry pricing;
• Even with distributors you trust, always ask for a genuine refrigerant;
• Examine refrigerant packaging for key security features and authentication labels; and
• Ensure the authenticity of a refrigerant by scanning the QR code on the Izon security label or by entering its seven-digit code at GenuineRefrigerants.com.

Lastly, we all need to work together to protect our industry. The EPA website offers resources for reporting environmental violations, as well as a hotline (800-424-8802). If you are worried you’ve come into possession of a questionable refrigerant product or if you suspect illegal activity, take time to report it.