The Case for R-290 in U.S.

Commercial Foodservice

Reviewing the advantages and

challenges for wider adoption of this

low-GWP natural refrigerant alternative

Tucson, Ariz. October 12, 2016

Allen Wicher

Director, Marketing — Foodservice

Emerson

Mike Saunders

Senior Lead Innovation Technologist

Emerson

This presentation is intended to highlight changing developments in the law and industry topics. The law is frequently evolving and information and publications in this presentation may not reflect the latest changes in the law or legal interpretations. The statements and information provided in this presentation should not be construed as legal advice or legal opinion regarding any specific facts or circumstances, but is intended for general informational purposes only. The views and statements expressed during this presentation are the personal opinions of the presenter and do not those of Emerson Climate Technologies, Inc. or its affiliated companies. You should consult an attorney about your situation and specific facts and you should not act on any of the information in this presentation as the information may not be applicable to your situation. Although all statements and information contained herein are believed to be accurate and reliable, they are presented without warranty of any kind. Information provided herein does not relieve the user from the responsibility of carrying out its own tests and experiments. Statements or suggestions concerning the use of materials and processes are made without representation or warranty that any such use is free of patent infringement and are not recommendations to infringe on any patents. This presentation may not be copied or redistributed without the express written consent of Emerson Climate Technologies, Inc.

Disclaimer

2

Refrigerant Change Being Driven by Regulations and Voluntary Actions

3

Global Regulatory Actions to Ban High-GWP Refrigerants PlaceRenewed Emphasis on Natural Alternatives.

Organizations

Montreal Protocol Targets Ozone

Depletion (R-22) Signed in 1987North American Proposal

Targets CO2 Emissions

(High Global Warming)

F-Gas RegulationCarbon Tax

HFC Ban & Tax

INTERGOVERNMENTAL PANEL ON

climate change

Regulations

EPA’s Final Rule, July 20, 2015, and September 26, 2016Changed listing status of certain HFCs*

*Abbreviated – For complete listing, see EPA Final Rule; go to: https://www.gpo.gov/fdsys/pkg/FR-2015-07-20/pdf/2015-17066.pdf

See proposed rule; go to: https://www.gpo.gov/fdsys/pkg/FR-2016-04-18/pdf/2016-08163.pdf

Final Rule: July 20, 2015 Final Rule: September 26, 2016

Phase-out

refrigerant

Super-

market

(New**)

Super-

market

(Retrofit***)

Remote

condensing

unit

(New)

Remote

condensing

unit

(Retrofit***)

Stand-Alone Refrigerated

food processing

and dispensing

equipment

(New)

Cold storage

warehouses

(New)

Ice

machines

(New)

Very low-

temp

refrigeration

(New)

MT < 2,200 BTU/hr.

and not contain

flooded evap.

(New)

MT ≥ 2,200 BTU/hr.

with or without

flooded evap.

(New)

LT

(New)

LT and MT

(Retrofit***)

R-404A/507A Jan. 1, 2017 July 20, 2016 Jan. 1, 2018 July 20, 2016 Jan. 1, 2019 Jan. 1, 2020 Jan. 1, 2020 July 20, 2016 Jan. 1, 2021 ^Jan. 1, 2023 OK OK

R-410A OK - OK - Jan. 1, 2019 Jan. 1, 2020 Jan. 1, 2020 - Jan. 1, 2021 ^Jan. 1, 2023 OK OK

R-407A/C/F OK OK OK OK Jan. 1, 2019 Jan. 1, 2020 Jan. 1, 2020 OK ^Jan. 1, 2021

R-407C/F OK

R-407A:

^Jan. 1, 2023

OK R-407C only

HFC-134a OK OK OK OK Jan. 1, 2019 Jan. 1, 2020 OK OK OK OK OK -

Likely alternatives

(Emerson perspective)

R-448A/449A OK OK OK OKNeither SNAP-

approved, nor banned

Neither SNAP-

approved, nor bannedOK

OK for

LT only- - OK -

R-450A/513A OK OK OK OK OK OK OK OK OK OK OK -

R-290 - - - - OK OK OK - - - OK OK

R-744 OK - OK - OK OK OK - OK OK - OK

R-717OK

(in primary loop of

secondary system)

-OK

(In primary loop of

secondary system)

-OK

(in primary loop of

secondary system)

OK(in primary loop of

secondary system)

OK(in primary loop of

secondary system)

OK(in primary loop of

secondary system)

OK(in primary loop of

secondary system)

OK OK -

** Includes ice machines connected to a supermarket rack refrigeration system.*** EPA uses term “retrofit” to indicate the use of a refrigerant in an appliance that was designed for and originally operated using a different refrigerant.

Term does not apply to upgrades to existing equipment where the refrigerant is not changed.

4

Alternatives for Refrigerant Applications

5

Watch: EPA SNAP, AHRI’s A2L Research, Standards and Code Committees, Equipment Manufacturers’ New Product Launches, CARB Proposal (<150 GWP)

Environment

R-410A

like

capacity

R-404A &

R-407/22

like

R-134a

like

GWP level

400–675

< 1500

~600

~300

HFO 1234yf

HFO 1234ze

ARM-42

R410A

R22

R407A

R407C

R407F, R452A

0 500 1,000 1,500 2,000

Pressure

or

R32/HFC/HFO

Blends

R-32/HFO

blends

HFC/HFO

BlendsR134a

CO2

R404A

R507A

DR2, N12, ARC 1

R290

NH3

A1 – Non-flammable

A2L – Mildly flammable

A3 – Flammable

R-123 like

(v. low pr.)

(3922)

R-32

R-32/HFO

blends

R448A

R449A

R450A

R513A

R-444B = L20

L40, DR7

ARM-20b

HDR110

DR3

ARM-20a

R-446A, R-447A, ARM-71a

<150

B2L – Toxic, mildly flam. Qualitative; not to scale

EstablishedAvailable nowOEMs testing

Summary for Refrigerant Changes

6

No Silver Bullet Refrigerant Alternative

• Industry workhorse R-404A to be delisted in many applications

• You will continue to see refrigerant changes and a movement toward low-GWP refrigerants

• No clear path to a single replacement

• Natural refrigerants including R-290 gaining an increasing level of evaluation and adoption

• EPA SNAP listing of A2L alternative refrigerants expected by end of 2016

• Many lower-GWP (<150) refrigerant alternatives carry an increase in flammability

• Standards working groups discussing charge limit increases, IEC, UL, ASHRAE, etc. As R-290 limits go up, so will A2L limits.

• Increased charge limit and end use application adds for A2L and A3 refrigerants will drive a new cycle of regulation edits (design, servicing, building code, fire code, training and handling requirements)

Where We Are: Energy Regulations and Refrigerants

7

Redesigns Are Widespread. Results Require System-Wide Optimization.

Today 2019

EPA refrigerants

Low-GWP blend

CO2

Low GWP Blend

R-290

R-404A

R-290

Low-GWP blend

% M

ark

et

100%

40%

100%

50%

Today 2017 Today 2018 Today 2017

0

20

40

-37%-35%

-17%-25%

Today 2017

SupermarketCA Title 24

Walk-inIceReach-in

DOE energy

% E

ne

rgy

2012 2013Today 2018 Today 2020

88

Refrigerants and Regulations

2016 2017 2018 2019 2020

Supermarket (Rack)

Walk-In (Remote CDU)

Cooler

Freezer

Reach-In (Stand-Alone)

Cooler <2,200 BTU

>2,200 BTU

Freezer

Ice Machines

<2,500 GWP

<2,500 GWP

20–40%

<600 GWP

<1,500 GWP

30-50%

5–15%

1/1/17

1/1/18

3/27/17

1/1/18

1/1/20

1/1/19

1/1/20

20–30%

7th Circuit Upholds DOE’s Final Rule

<600 GWP

Next Two Years Are Very Active for the Industry

New

R-290

approved New

Expecting medium-pressure adds

Refrigerant and Minimum Energy Efficiency Regulations

Require Industry to Balance the Equation in U.S.

9

Seek Best Solution for End Users

• Reduce energy consumption with optimized refrigeration equipment system performance.

• Ensure EPA compliance and reduce GWP with refrigerant choices that minimize impact to equipment performance.

• Preserve reliability, serviceability and safety. Understand the toxicity, flammability and pressure implications.

• Estimate the total cost of ownership and viability of technology changes.

Refrigerant Properties

10

EnergyEnvironmentEquipment

Refrigerant

(safety group)

GWP

(AR4)

Critical

temp. (°F)

LEL

(% vol.)

UEL

(% vol.)

Ignition temp.

(°F)MT theor. cap. MT theor. EER Theor. sys. charge

R-404A (A1) 3,922 161.7 Non-flam Non-flam Non-flam 100% 100% 100%

R-22 (A1) 1,810 205.1 Non-flam Non-flam Non-flam 101% 113% 91%

R-134a (A1) 1,430 213.9 Non-flam Non-flam Non-flam 62% 114% 85%

R-290 (A3) 3 206.1 2.1% 9.5% 878 88% 112% 39%

• Refrigerant grade R-290 does not have odorant

• R-290 heavier than air

Higher flammability A3 B3

Lower flammability A2 B2

A2L* B2L*

No flame propagation A1 B1

Lower toxicity Higher toxicity

Safety group

Incre

asin

g fla

mm

abili

ty

Increasing toxicity

* Max burning velocity <=10 cm/s

R-404A and R-290 EER Comparison

11

R-290 Yields 20%+ Better EER Efficiency Over R-404A.

Environment

Energy

Results from Emerson’s test labs, comparing the Energy Efficiency Ratio (EER) of R-404A to R-290 in medium and low back pressure (MBP), show a significant improvement when using R-290.

+10%

+21%

+13%

+23%

+22%

+22%

R-290 Codes and Standards

12

Must Comply With Design and Safety Standards.

Be Sure to Check AHJ Before Installing Equipment.

• Refrigerant charge < 150 gm (5.3 ounces) for food retail stand-alone

– In line with the IEC 60335-2-89 standard for commercial appliances

• New equipment only — no retrofitting of equipment to R-290 is allowed

• Safety standards for equipment manufacturers

– UL-471

– IEC 60335-2-24: Household refrigerators and freezers

– IEC 60335-2-34: Motor compressors

– IEC 60335-2-89: Commercial refrigerators and freezers

– IEC 60335-2-40: Heat pumps, air conditioners and dehumidifiers

• AHJ (Authority Having Jurisdiction)

– Local authorities such as state, local as well as fire marshals may have other restrictions

EnvironmentEquipment

EPA’s ‘SNAP’ Program for Hydrocarbon Refrigerants

in Commercial Refrigeration

13

Various Use Conditions to Consider

• UL 471, SB1 contains additional specifics for flammable refrigerants

– Fitting types to be used (no quick connect, flare, compressor or packed stem valves)

– Design space and construction guidelines

– Leaks and leak tests to be performed

– Ignition tests to be done

– Labels and markings required on equipment

– Color-coded processing tubes to indicate use of a flammable refrigerant

• Other use conditions and recommendations

– Small containers: To prevent purchase by untrained people, the hydrocarbon refrigerants will not be sold in containers in quantities of less than five pounds (2.8 kg).

– Handling by trained personnel only: EPA recommends that only technicians specifically trained in handling flammable refrigerants undertake the servicing or disposal of equipment containing hydrocarbon refrigerants.

EnergyEnvironment

Economics

Equipment

Servicing

14

Adherence to Servicing Procedures a Must

• Specialized training for R-290 highly recommended– Refrigeration Service Engineers Society, RSES.org

• Flammable refrigerant leak detector required– Leave on while servicing

• Place safety placard advising no smoking or open flames

• R-290 may be recovered, but is not required. It can be vented to the atmosphere, per EPA regulations.

• Brazing recommendations– Work in well-ventilated, open spaces.

– Eliminate all ignition sources.

– Purge system with dry nitrogen to displace any trapped propane.

– Continue purging during brazing process.

– Tubes should be cut with tubing cutter vs. torch.

– Evacuate to minimum 500 microns.

• Charging procedures are same for R-290 as HFC refrigerants

EnvironmentEquipment

Flammable Refrigerants Create Challenges

15

Servicing Infrastructure Needs Development.

Refrigerants approved by the EPA under Significant

New Alternatives Policy (SNAP)

Limitations

• Stand-alone units only

• Equipment size due to limited charge (150 grams or 5.3 ounces)

• Currently no formalized certification of service technicians

• No channel developed for service replacements for compressors

• Liability concerns

EnvironmentEquipment

Guideline for technicians with info

on best practices

R-290 (Propane)

R-600a (Isobutane)

R-441A (a blend)

Relevant EN Standards for Hydrocarbon UsageCommercial refrigeration

16

Charge Limits Based on System Design and Location

• EN 60335-2-89 (Commercial Ref. Appliances): max. 150g

• EN 378 (Refrigeration Systems): see below

System Design and

System Location

Occupancy

Public AccessSupervised

Occupancy

Authorized

Access Only

System in occupied space 1.5 2.5 10

Compressor and receiver in

unoccupied space1.5 2.5 25

All refrigerant in unoccupied

space5 10 Unlimited

EN378: Max. Charge Limit for HC (Propane), kg

EnergyEnvironment

Economics

Equipment

Hydrocarbons UsageImplications for OEMs and operators

17

OEMs and Operators Need to be Aware of Increasing System Costs as Charge Increases.

Application OEM Operator

A3 Refrigerant

< 150g

R-290, R-1270

• Design and safety based on EN 60335-

2-89: Part 2-89

• No special requirements for installation and

operation of the system

A3 Refrigerant

150g … 1.5 kg

R-290, R-1270

• Conformity EN378

• ATEX 94/9/CE compliance

• Charge limit for vicinity with public:

max 1.5 kg or practical limit x volume*

• Risk analysis, raised complexity for service,

operation and personnel instructions

A3 Refrigerant

> 1.5 kg

R-290, R-1270

• Practically, systems can be moved

outside public area

• Conformity EN378

• ATEX 94/9/CE compliance

• Same as above

• Outside area, e.g., rooftop, restricted access

*Example: Practical limit R-290 = 0.008 kg/m3; Room 8 m x 8 m x 3 m => 1.54 kg

EnergyEnvironment

Economics

Equipment

Europe: The Usage of Hydrocarbons Has Been

Extended to Wider Refrigeration Applications

18

R-290 Has a Wider Market Acceptance in Europe vs. U.S.

Self-contained cases (MT)

Secondary systems

Small cascade systems

Condensingunits

• Emerging system

architecture

• Low charge allows HC usage

• Discounters, supermarkets

• Alternative natural ref. solution

• High-charge HC usage

• Supermarkets, hypermarkets

• R-290 / CO2 solution

• Total natural ref. solution

• Cold rooms, convenience

• Economical natural ref. solution

• Low charge allows HC usage

• Cold rooms, convenience

Hydrocarbons already established in low-temperature cabinets successfully

EnergyEnvironment

Economics

Equipment

Europe R-290 Case Study

19

Merchandising Flexibility and Ease of Service Drive Supermarket Adoption.

• Self-Contained Cases With R-290 Scrolls for Medium-Temp

- Fully hermetically sealed refrigeration system

- 2.5 and 3.75 m self-contained cabinets

- 4.8 to 7 kW cooling capacity

- Refrigerant charge 500 to 700g per cabinet

- ATEX components and safety sensors

EnergyEnvironment

Economics

Equipment

Water/Glycol

condensing

Feature Centralized DX Remote System Self-Contained Display Case

Flexibility Low High – Plug and Chill

Service Complexity High Low

Refrigerant Charge High Low (-85%↓)

System Lead Time Long Fast

On-site Installation Complex, Long Pipe Length Simple, Factory Built

Refrigerant Leak Rate High Minimal

Benefits Associated With Self-Contained

R-290 U.S. Commercial Applications Charge limits/codes/standards evolving

20

In U.S, Significant Headwinds Exist to Increase Charge Limits.

R-290: U.S. 300–500-gram charge limit in proposal (CE-2020)

R-290: European proposal to increase to 1 kg (IEC 60335-2-89)

A2L: U.S. 1 kg. charge limit in proposal (CE-TBD)

1/8HP 1/6 1/4 1/3 1/2

Domestic refrigerators

Vending mach.

Bev. dispensers

UC/prep

Bottle coolers

3/4 1

1DS 1DT 2DS 3DS 3DG

X = Use applications not approved by EPA

X

Ice

Walk-ins

Commercial reach-ins

X2DT

150g charge limit

Larger units achievable with multiple systems

(awaiting Federal Register release)

IEC/UL/ASHRAE:

EnergyEnvironment

Economics

Equipment

U.S. R-290 Case Study

21

Energy Savings, Sustainability and Ease of Service Drive Supermarket Adoption.

Name of the Store/Facility: H-E-B at Mueller

Location: Austin, Texas, United States

Type of Facility: supermarket; store area = 7,711 m2

Refrigerant/Product Used: R-290, self-contained cases

Project Background:

• Develop sustainable design test store

• Reduce energy and potable water consumption 50% vs. 2010 baseline

• Trial the use of climate-friendly refrigerants

EnergyEnvironment

Economics

Equipment

• New System Installation– 70 refrigerated cases (cooling capacity 1,013 MBTU’s)

– Majority of cases self-contained R-290 within store connected to water-chilled 134a condenser

– Chiller used for space cooling/heating and refrigeration (25% of load)• Majority have door or sliding lid; minimizes energy consumption and allows for small refrigerant charge

• Results– Performance data not available at case study

– 85% carbon footprint reduction vs. baseline store• 58% due to reduced energy use

• 27% due to direct emissions avoided b/c R-290 use

– Costs higher than baseline store but ROI will be realized

• No refrigeration contractor necessary

• Maintenance low, self-contained simple

• Reduced energy bill

• Challenges/Lessons Learned– Limited refrigerant charge (150g) meant more compressors than traditional

– Austin Fire Dept. required extra leak detection, alarm systems

U.S. R-290 Case Study

22

EnergyEnvironment

Economics

Equipment

U.S. R-290 Adoption

23

OEMs Working Directly With End Users on Integrating

Renewable Energy Solutions Like R-290 Where Applicable.

EPA SNAP-approved, very low-GWP alternative refrigerant

Efficiency benefits

Foodservice market leaders driving OEMs

http://www.fierceenergy.com/story/mcdonalds-

eyeing-net-zero-energy-restaurants/2015-02-03

EnergyEnvironment

Economics

Equipment

The Case for R-290 in U.S.

24

Charge Limit Increase in U.S. Will Bring a Revision Iteration of All Regulations Impacted.

Advantages• Hydrocarbon-based, non-synthetic

substance

• EPA-approved in commercial refrigeration applications

• Very low environmental impacts: GWP = 3; ODP = 0

• High-efficiency, high-performance, reliable

• LT and MT applications that address EPA and DOE compliance challenges

• Safe when proper protocols and procedures are followed

• Hydrocarbons can be used in multiple applications such as secondary systems, self-contained cases and condensing units

Challenges• Classified A3 flammable refrigerant

• Not a “drop-in” refrigerant, equipment and components designed for R-290

• Globally mandated low-charge limits of 150g restrict application range

• Difficulty getting approved in fire and building codes

• Lack of trained and certified technicians

• Market is currently missing a complete product and safety training course

• Charge limit, safety and related legislations/regulations are the key areas to address for hydrocarbons

EnergyEnvironment

Economics

Equipment

Questions?

DISCLAIMER

Although all statements and information contained herein are believed to be accurate and reliable, they are presented without guarantee or warranty of any kind, expressed or

implied. Information provided herein does not relieve the user from the responsibility of carrying out its own tests and experiments, and the user assumes all risks and liability for

use of the information and results obtained. Statements or suggestions concerning the use of materials and processes are made without representation or warranty that any such

use is free of patent infringement and are not recommendations to infringe on any patents. The user should not assume that all toxicity data and safety measures are indicated

herein or that other measures may not be required.

Thank You!

25

Allen Wicher

Director, Marketing — Foodservice

937-493-2496

allen.wicher@emerson.com

Mike Saunders

Senior Lead Innovation Technologist

937-726-4928

mike.saunders@emerson.com