USA Refrigerants Market Outlook to 2030

USA Refrigerants Market Overview

• The USA refrigerants market is valued at USD 5.1 billion, driven by the increasing demand for refrigeration and air conditioning systems across commercial, residential, and industrial sectors. This growth is further fueled by stringent environmental regulations encouraging the adoption of low global warming potential (GWP) refrigerants. The transition towards energy-efficient cooling systems, driven by consumer demand and government mandates, is a major factor propelling market size.

• Key cities and regions dominating the USA refrigerants market include California, Texas, and Florida. These areas are due to their high concentration of urban populations, increased adoption of air conditioning systems, and robust commercial infrastructure. Moreover, these states lead in regulatory initiatives aimed at phasing out high-GWP refrigerants, fostering the adoption of alternatives like hydrofluoroolefins (HFOs) and natural refrigerants. This makes them key regions contributing to market dominance.
• The Clean Air Act provides a comprehensive regulatory framework for the management and phase-down of ozone-depleting substances and high-GWP refrigerants in the U.S. Under this law, the EPAs phasedown of HFCs is expected to continue through 2036, with specific targets set for 2024 . Businesses in the refrigeration and HVAC industries must comply with these guidelines, which impact the availability and usage of refrigerants across various sectors. This ongoing regulatory pressure ensures that businesses increasingly turn to low-GWP refrigerants and other environmentally friendly solutions to meet compliance standards.

USA Refrigerants Market Segmentation

By Product Type: The market is segmented by product type into hydrofluorocarbons (HFCs), hydrofluoroolefins (HFOs), natural refrigerants (such as CO2 and ammonia), and refrigerant blends (R-404A, R-410A, R-32). Recently, hydrofluorocarbons (HFCs) have maintained a market share in the USA refrigerants market. HFCs have been widely used due to their efficiency in cooling and heating systems, especially in commercial air conditioning units and refrigeration systems. However, despite their market dominance, HFCs face regulatory restrictions due to their high GWP, leading to a gradual shift towards low-GWP alternatives such as HFOs and natural refrigerants.

By Application: The market is also segmented by application into commercial refrigeration, residential air conditioning, industrial refrigeration, and automotive AC systems. Among these, commercial refrigeration holds the dominant market share. This is primarily due to the widespread use of refrigerants in grocery stores, warehouses, and other cold storage facilities across the country. The growing demand for cold chain logistics in food distribution and pharmaceuticals has been a key driver for the commercial refrigeration segment.

USA Refrigerants Market Competitive Landscape

The USA refrigerants market is highly competitive, with several major players leading the industry. These companies dominate the market due to their strong presence in the production and distribution of various refrigerants, as well as their focus on developing environmentally friendly products. The market is characterized by both global players and local manufacturers, with Honeywell International and Chemours leading in the development of low-GWP refrigerants. These companies have made investments in research and development to comply with regulatory changes and meet the growing demand for eco-friendly solutions. Below is a comparison of major players in the market:

USA Refrigerants Industry Analysis

Growth Drivers

• Increasing Demand for HVAC Systems: The demand for HVAC systems in the U.S. is driven by growing urbanization and residential construction. In 2023, the U.S. added 1.6 million new housing units, increasing the need for residential HVAC systems to maintain comfort in varying climates. In the commercial sector, the ongoing expansion of retail, office spaces, and industrial units contributes to the demand for HVAC solutions. In 2024, around 600 million square feet of new commercial construction is expected to be completed in the U.S. This expansion of real estate drives refrigerant demand as more systems are installed.
• Stringent Environmental Regulations: U.S. regulations on refrigerants are a key driver for the market. The Environmental Protection Agency (EPA) enforces stringent laws under the Clean Air Act, including the phasedown of hydrofluorocarbons (HFCs). The EPA aims to reduce HFC consumption by 85% by 2036 under the Kigali Amendment, a legally binding global agreement. The 2023 phase-out plan is already underway, prompting HVAC manufacturers to shift to low-global warming potential (GWP) alternatives. The adoption of natural refrigerants and hydrofluoroolefins (HFOs) is supported by these environmental regulations, driving demand for compliant products.
• Expansion in Cold Chain Logistics: The cold chain sector has expanded , particularly in food and pharmaceutical logistics. In 2022, the U.S. cold storage capacity exceeded 4 billion cubic feet. This growth is driven by the increasing demand for frozen foods and the need for precise temperature control in vaccine distribution. The COVID-19 pandemic accelerated cold chain investments, particularly in pharmaceutical logistics. By 2023, over 800 million doses of vaccines were stored and distributed using cold storage facilities. This sustained demand drives the need for advanced refrigerants in these systems.

Market Challenges

• Regulatory Compliance and Phase-out of HFCs: Compliance with the phase-out of HFCs is a major challenge for manufacturers and service providers. Under Section 608 of the Clean Air Act, the EPA requires technicians to use certified refrigerants and follow strict handling guidelines. In 2024, the EPAs allocation framework for HFCs will limit the supply of high-GWP refrigerants, making it difficult for smaller businesses to access compliant alternatives. The cost of retrofitting existing systems to low-GWP refrigerants can also present financial and logistical challenges for HVAC operators.
• High Costs of Low-GWP Alternatives: While low-GWP refrigerants such as hydrofluoroolefins (HFOs) and natural refrigerants are environmentally friendly, their high initial costs pose a challenge. For example, the cost of HFOs is generally higher than traditional HFCs, sometimes by a factor of two or more. This cost differential makes it difficult for smaller operators to transition, especially in residential and light commercial applications. The adoption of these alternatives is slowed down by the economic burden they place on consumers and service providers, particularly in the context of retrofitting older HVAC systems.

USA Refrigerants Market Future Outlook

Over the next five years, the USA refrigerants market is poised for transformation. The increasing emphasis on reducing greenhouse gas emissions, coupled with government initiatives to phase out high-GWP refrigerants, will push the market towards adopting environmentally friendly alternatives. Additionally, advancements in refrigeration technology and the rising demand for energy-efficient cooling solutions will continue to shape the market's growth trajectory. As more industries, particularly the commercial and industrial refrigeration sectors, transition to low-GWP refrigerants, the market will witness a gradual decline in the use of HFCs and a rise in demand for HFOs and natural refrigerants.

Future Market Opportunities

• Transition to Natural Refrigerants: The transition to natural refrigerants such as ammonia (NH3) and carbon dioxide (CO2) presents an opportunity. These refrigerants have a negligible global warming potential and are exempt from current phase-out regulations. Ammonia is widely used in large-scale industrial refrigeration, particularly in food processing and cold storage, where U.S. capacity exceeded 4 billion cubic feet in 2022. CO2 is gaining traction in commercial applications due to its efficiency and environmental benefits, especially in supermarket refrigeration systems. This trend is expected to create more demand for natural refrigerants as industries adapt to sustainability goals.
• Growth in Renewable Energy-Powered Cooling Solutions: Renewable energy-powered cooling solutions are emerging as a promising opportunity in the refrigerants market. The U.S. generated over 1,200 terawatt-hours (TWh) of renewable electricity in 2023, providing a robust foundation for integrating solar and wind-powered cooling systems. These systems, which use environmentally friendly refrigerants such as HFOs or natural alternatives, reduce energy costs and emissions. The growing focus on sustainability and reducing operational costs is expected to drive adoption in both residential and commercial sectors. Government incentives for renewable energy adoption further boost this opportunity.