Hot Sales of Air Conditioning Units Driven by Legal Loophole

Hot Sales of Air Conditioning Units Driven by Legal Loophole

10/18/2011

 

A chilly battle has broken out in the air-conditioning market in the United States as manufacturers attempt to meet head-on the unwillingness of consumers to pay up for equipment that do not have an ozone-depleting refrigerant.

A legal loophole allows companies to continue producing air conditioning units containing a refrigerant that was banned last year in the United States. This move has driven a wedge between an industry that has been struggling to respond to a fragile economy and a declining housing market that dropped air conditioning shipments last year to 36% below degrees ten years ago.

Some executives cautioned against continuing to provide equipment containing R-22 or hydrocholoroflorocarbon-22 refrigerant, saying that this would make it difficult for them to attract more buyers for higher-margin and more energy efficient systems that use more environmentally friendly refrigerants.

According to John Mandyck, Carrier Corp’s chief sustainability officer, “It’s really bad environmental policy. We ought to be getting back on track with what’s been understood for decades, that R-22 should be phased out.”

Manufacturers had expected the sales of their latest models to receive a boost when the United States Environmental Protection Agency last ear prohibited the production and sale of home units that contain R-22. However, cash-strapped buyers have been choosing to overhaul their existing R-22 units with new outdoor condensers for $1,500 to $2,000 instead of paying $3,500 for a totally new system.

Manufacturers have started to again produce older-model condensers under a provision in the EPA regulation which allows them to manufacture replacement parts for R-22 systems as long as they are not loaded with the refrigerant at the factory. Instead, air conditioning and heating contractors add the refrigerant upon installation of the units.

WRITTEN BY:

blakeh@wellsdrew.com