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M(iNTREAL PROTOCOL ChillerRefrigeration ODS Phase-out Alternatives OORG CHILLER WORKING GROUP OZONEOPERATIONS RESOURCE GROUP REPORT NUMBER 10 JULY 1994 a TiIE W19RLD EAi-I L .', i L E' II " :S_hi;'NA 7 r'l Cv: DIPi7 D i NA!i NJ R ir,A> I 'El .AI ,l Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized

Transcript of Public Disclosure Authorized M(iNTREAL PROTOCOL · * Retrofits to both HCFC-123 and HFC-134a,...

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M(iNTREALPROTOCOL

Chiller RefrigerationODS Phase-out Alternatives

OORG CHILLERWORKING GROUP

OZONE OPERATIONS RESOURCE GROUPREPORT NUMBER 10

JULY 1994

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CONTENTS

Page

Preface i

Chiller Refrigeration ODS Phase-out Alternatives I

APPENDIX I: Definitive Recommendations 5

APPENDIX II: Cost-effectiveness of Options to Reduce OzoneDepleting Substances: Chillers and Motor Vehicle AirConditioners 11

APPENDIX III: OORG Publications List 43

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PREFACE

As sector-specific problems and issues arise and are identified as needing additional or special attention,OORG Working Groups are established under the coordination of the relevant OORG Sector Advisor andare comprised of technical experts from companies, laboratories and applied research institutions on theleading edge of technological developments in industry around the world. Working Group expertparticipants to date have included individuals from a growing number of developing countries, amongthem, Brazil, China, and India. OORG Working Groups prepare and periodically update sectoraloverview papers and recommendations as guidance to Bank task managers and client developing countriesin preparing investment projects for financing through the Montreal Protocol and the Global EnvironmentFacility.

By mid-1994, five OORG working groups had been assembled and met at least once to prepare sector-specific overview papers and associated definitive recommendations and guidance to the Bank and itsclients', namely: (1) the OORG Refrigeration Working Group, (2) the OORG Refrigeration/FreezerInsulating Foam Working Group, (3) the OORG Foam Pre-insulated Pipes Working Group, (4) the OORGProduction Alternatives Working Group, and (5) the OORG Chiller Working Group.2

I This particular report, OORG Report No. 10, includes an up-dated set of recommendations for the chiller refrigeration sector. Dr.Lambert Kuijpers, Technical University, Eindhoven, The Netherlands, is the OORG Refrigeration Sector Advisor to the World Bank and Chairmanof the OORG Chiller Working Group.

2 See present list of OORG publications, Appendix Ill.

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CONTENTS

Page

Preface

Chiller Refrigeration ODS Phase-out Alternatives 1

APPENDIX I: Definitive Recommendations 5

APPENDIX II: Cost-effectiveness of Options to Reduce OzoneDepleting Substances: Chillers and Motor Vehicle AirConditioners 11

APPENDIX III: OORG Publications List 43

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Ozone Operations Resource Group(OORG)

CHILLER REGRIGERATION ODS PHASE-OUT ALTERNATIVES

1. Background

The Ozone Operations Resource Group (OORG) was assembled by the World Bank to providespecialized sector-based technical advice and assistance to the Bank in fulfilling its role as one of the fourprincipal implementing agencies (with UNDP, UNEP and UNIDO) of the Multilateral Fund under theMontreal Protocol (MFMP). Within the context of the Bank's assistance to the developing countries toprepare Country Programs and investment projects for the phase-out of ozone depleting substances (ODS),the OORG keeps the Bank apprised of applicable sector-specific technological advances, commerciallyavailable ODS substitutes, the cost-effectiveness of the various sectoral options, and related developments.

The First OORG Chiller Working Group Meeting was convened by the World Bank inWashington, D.C., on July 15, 19943. Dr. Lambert J. Kuijpers, Chairman of the Working Group, andOORG Refrigeration Sector Advisor, began the meeting with an overview of key events leading up to themeeting. Of particular note were proposed chiller projects which the Bank had prepared for Thailand in1993 and which provided examples of some of the issues to be addressed by the Working Group. Thesecase studies were reviewed by the Group. Dr. Kuijpers recounted how problems raised by these projects(ie., the efficacy of funding chiller retrofit projects) prompted the Bank to commission ICF, Inc., in early1994, to undertake a special study of the principal cost factors driving the tradeoffs between CFCcontainment, conversion (retrofit), or replacement of chillers with non-CFC alternative refrigerants. Theresults of this study were presented at the regular OORG meeting in February 1994 and a copy of thepaper is presented in Appendix II of this report. In the meantime, an independent study on chiller optionswas also undertaken by the Fund Secretariat which produced very similar findings. The morning sessionwas devoted substantially to a presentation of these papers and discussion of the implications of theirconclusions by the Working Group.

2. Major Findings

Mr. Bernard Eydt, a Working Group member and one of the principal authors of the ICF study,presented a summary of the major findings. The study analysis employed a computerized model whichpermitted a variety of simulations of alternatives and sensitivity analyses of various tradeoffs. First andforemost was the confirmation that the overwhelming factor driving considerations of either chillerconversions or replacements is the potential for substantial energy efficiency gains. Second in importanceare capital costs. Of least importance, however, were ODS refrigerant prices and wage rates - widevariations in neither of which affected the relative cost-effectiveness of the various chiller optionssignificantly. Among the three options considered, retrofits were not found to be cost-effective because ofassumed generally lower energy efficiency when implemented. Also, the longer a representative owner

3/ The First OORG Chiller Working Group Meeting was convened at World Bank Headquarters, in Washington, D.C., on Friday, July 15,1994. The meeting was chaired by Dr. Lambert Kuijpers. Working Group members included: Dr. Lambert Kuijpers (Chairman, TechnicalUniversity. Eindhoven, The Netherlands), Dr. Mark Menzer (Air Conditioning and Refrigeration Institute, Arlington, VA.), Mr. Jim Crawford(The Trane Company, Arlington, VA.), Mr. Leong Kam Son (York Intemational, Petaling Jaya, Malaysia), Mr. James Parsnow (Carrier Corp.,Syracuse, NY), Mr. Bill Kopko (USEPA, Washington. D.C.), and Mr. Bernard Eydt (Environmental Law Institute, Washington, D.C.). Dr.Denis Clodic (Ecole de Mines de Paris, Paris, France), became a member subsequent to the meeting and participated in review of the finalrecommendations. Observers included representatives from the United Nations Environment Program (UNEP) and the Multilateral FundSecretariat, as well as World Bank staff.

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waits to retrofit his facility, the worse the retrofit option becomes and the relatively more attractive thereplacement choice is. Although the study assumed that retrofits did not extend the life of the facility atall - this limitation was unlikely to change the findings substantially. Indeed, the only circumstancementioned which might have favored retrofitting would be the existence of a unique structural or logisticalconstraint which might make conversion more cost-effective than replacement. The example cited was of achiller located in the basement of a building such that the only means of replacement might requireextremely costly excavation, wall removal, etc., or could put the structural integrity of the entire buildingat risk. Such circumstances were judged to be extremely rare in fact.

Mr. Valery Smirnov, Program Officer on the staff of the Multilateral Fund Secretariat, thenpresented a summary of the Fund Secretariat's study chiller alternatives. Although the study did notemploy a model or other analysis, it arrived at similar conclusions to the ICF study. The studyrecommendations were presented to the Executive Committee during its March 1994 meeting whichendorsed the findings.

Principal among these were the following:

1. The Total Equivalent Warming Impact (TEWI) should be considered in selectingalternative technology in the chiller sector, which would include both direct effects(refrigerant global warming potential) and indirect effects (system energy efficiency), andto human health and safety aspects.

2. Refrigerant containment and better operation and maintenance practices, includingrecovery/recycling/reclamation are approved as strategic options in ODS phase-out in thechiller sector in Article 5 countries. Article 5 countries should pursue a more aggressiverefrigerant containment program, including recovery/recycling/reclamation.

3. Conversion of CFC-based chiller manufacturing facilities is approved as a strategic optionin ODS phase-out in the chiller sector.

4. Replacement of CFC chillers is a first priority strategic option in ODS phase-out in thechiller sector. Energy savings should be taken into consideration when calculating theincremental costs of replacement.

5. Chiller retrofit project proposals should be deferred, except in special cases and whendefinite substitutes are used.

6. Appropriate regulatory and legislative action should be encouraged to facilitate theimplementation of CFC phase-out projects in the chiller sector. These should include theimmediate cessation of the installation of new CFC chillers.

During subsequent discussions it was pointed out that leak rates of 8 to 12 percent in developedcountries and as much as 15 to 20 percent in some developing countries could be substantially reducedthrough improved maintenance and repair (the containment option) to between 2 and 3 percent per annum.New replacement chillers with a good maintenance servicing contract can reduce leakage rates well below1 percent per annum (to .1 - .5 %). These conclusions hold regardless of whether or not the refrigerant isa high, medium or low pressure variety.

It was also clarified that while chillers are typically assumed to have a lifetime of only 20 years,many chillers in fact may experience operational lifetimes of 23 to 35 years when they are properly

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maintained.

Likewise, in many developing country settings, presently installed chiller equipment is oversizedwith often excessive and unnecessary back-up capacity, which could mean that an appropriately engineeredretrofit of lower gross capacity but equivalent net refrigeration production might be a cost-effectiveconsideration.

A number of suggestions for retrofit or replacement implementation schemes were proposed by theGroup, among them: (1) a program of service contracts with major multi-facility owners provided theysign an agreement not to purchase new CFC refrigerants; (2) a chiller rebate program which wouldreimburse owners after implementation of a replacement chiller was verified, based upon a set formulaaccording to the tonnage and age of the original chiller; and (3) providing financial assistance necessary toinduce establishment of a private entity to undertake CFC refrigerant reclamation, banking and recyclingon a for profit basis.

Finally, it was considered a first priority to promote the cessation of production of new CFC-basedchiller equipment in developing countries. It was noted that all major developed country manufacturershad already ceased production of CFC-based equipment. A very close second priority was to ensure thatno retrofit or replacement project be proposed without a certifiable plan for disposal of the CFC refrigeranthas been satisfactorily outlined and agreed to by the enterprise. Such certification should be verifiedthrough appropriate involvement of internationally recognized reputable manufacturers and theirrepresentatives in developing countries. Furthermore, training whether through the private sector orthrough government, should be included as a part of project preparation and/or demonstration and beaimed at the certification of technicians.

3. OORG Chiller Working Group Recommendations

Principal findings of the meeting included the following recommendations:

Refrigerant containment combined with recovery offers the most cost-effective option forreducing CFC consumption in chillers, assuming some supply of CFCs is available.

* Replacement of CFC chillers is a first priority strategic option in CFC phase-out for agingchillers. Energy savings should be taken into consideration when calculating theincremental and unit abatement costs of replacement.

* HFC-134a, HCFC-123, and HCFC-22 should all be regarded as viable alternatives for newchiller equipment.

* Ammonia is also a viable alternative for new chillers, especially for large plants, wherecommercially available and where appropriate application and safety requirements can bemet.

* Retrofits to both HCFC-123 and HFC-134a, respectively, are viable options to reduceCFC-11 and CFC-12 consumption in chillers, and offer a third strategic option for CFCphaseout in the chiller sector. However, a retrofit should only be carried out in situationswhere it will result in a substantial extension of the equipment lifetime, without a decreasein energy efficiency - and only when zero or low-ODP refrigerant substitutes are used.

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The complete list of final recommendations of the First OORG Chiller Working Group meeting arepresented in Appendix I of this report.

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APPENDIX I

OORGCHILLER WORKING GROUP

RECOMMENDATIONS

July 1994

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OORG CHILLER WORKING GROUP

RECOMMIENDATIONS

July 1994

Promote Strategic Planning of Chiller CFC Phase-out, Including Pre-conditions

1. Any plan for reducing the consumption of CFC in chillers should include strategicconsideration of: (a) high quality refrigerant containment, (b) replacements, (c)retrofits, and (d) cessation of CFC-based chiller equipment manufacturing.

2. Containment and management of refrigerants must be integral to any strategy forchiller retrofits and/or early replacements. Cost-effective reductions of CFCconsumption on a national and/or regional scale should be the first goal.

3. Article 5 countries should not receive grants for chiller conversion or replacementprojects before adequate refrigerant storage facilities are established and availablein that country. It would be advantageous if the country has access to reclamationfacilities as well.

4. Any chiller CFC phase-out project, whether for retrofit or early replacement,should be supported, through an appropriate service contract, by both theenterprise and the servicing and/or manufacturing organization.

Promote Appropriate Regulatory and Legislative Action

5. Appropriate regulatory and legislative action should be encouraged to facilitate theimplementation of CFC phase-out projects in the chiller sector. These shouldinclude the immediate cessation of the installation of new CFC chillers. If CFCchillers were installed after 1993, retrofits or replacements should not be eligiblefor Multilateral Fund support.

6. The transfer of decommissioned/refurbished CFC chillers to Article 5 countrieseither from Article 5 or non-article 5 countries should be prohibited, by makingthis part of the country's strategy to reduce CFC consumption in chillers. Thisimplies that appropriate regulatory and legislative action should be encouraged.

7. Project proposals involving retrofit, replacement and containment should preferablybe carried out for a group of chillers within a country or a region, in cooperationbetween Article 5 country government(s) and reputable chiller manufacturers andservicing agencies.

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8. Containment and maintenance programs should only be initiated if there is aguarantee that the refrigerant consumption of a chiller can be brought down to lessthan 10-15% per year.

9. Training programs by qualified organizations, involving reputable chillermanufacturers or their authorized representatives, are a first requirement toachieving substantial consumption reductions. Technician certification can be auseful incentive to promote training.

Promote CFC-Based Chiller Manufacturing Plant Conversion to Non-CFC

10. Conversion of CFC-based chiller manufacturing facilities should be recommendedas a first priority strategic option in CFC phase-out in the chiller sector.

Promote Contaimnent

11. Refrigerant containment and better operation and maintenance practices, includingaggressive recovery/recycling/reclamation, are recommended as strategic options inCFC phase-out in the chiller sector. Implementation of a containment programrequires elaboration of a specification sheet by the owner to ensure that theoperation, maintenance and repair activities are realized with minimal emissions.

12. Refrigerant containment combined with recovery offers the most cost-effectiveoption for reducing CFC consumption in chillers, assuming some supply of CFCsis available.

Promote Chiller Replacement

13. Replacement of CFC chillers is a first priority strategic option in CFC phase-outfor aging chillers. Energy savings should be taken into consideration whencalculating the incremental and unit abatement costs of replacement.

14. HFC-134a, HCFC-123, and HCFC-22 should all be regarded as viable alternativesfor new chiller equipment.

15. Ammonia is also a viable alternative for chillers, especially for large plants, wherecommercially available and where appropriate application and safety requirementscan be met.

16. Replacements should be carried out by reputable major chiller manufacturers ortheir authorized representatives.

17. Three bids from reputable chiller manufacturers should be obtained beforeproceeding with the development of a replacement project proposal. When this isnot possible, cost estimates from comparable competitively priced undertakingsshould apply.

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18. Funding of chiller replacement projects could be standardized as part of a global orregional rebate program that would offer fixed cash grants to participants ratherthan calculate costs on a case-by-case basis. This method of financing should bestudied further to determine its viability. A rebate approach mechanism has thepotential to both accelerate CFC reductions in the chiller sector and reduce thecosts of administering grants awarded by the Multilateral Fund.

Promote Chiller Retrofits Where Least-Cost Conditions Apply

19. Retrofits of chillers are a third strategic option for the CFC phaseout in the chillersector. However, a retrofit should only be carried out in situations where it willresult in a substantial extension of the equipment lifetime, without a decrease inenergy efficiency, such that least-cost UAC comparisons with containment andreplacement alternatives are favorable - and only when zero or low-ODPrefrigerant substitutes are used.

20. Retrofits to both HCFC-123 and HFC-134a are viable options to reduce CFC-11and CFC-12 consumption in chillers, respectively.

21. Chillers operated on CFC-1 13 and CFC-1 14 should not be retrofitted until suitablereplacement refrigerants have found wide acceptance and are proven reliable.

22. Retrofits should be carried out by reputable major chiller manufacturers or theirauthorized representatives.

23. Three bids from reputable chiller manufacturers should be obtained beforeproceeding with the development of a retrofit project proposal. When this is notpossible, cost estimates from comparable competitively priced undertakings shouldapply.

Promote Energy Efficiency

24. Energy efficiency is a great influence on the cost-effectiveness of all chilleroptions; differences in energy consumption costs should be considered in thedetermination of the unit abatement costs over an appropriate period of years.

25. However, the Total Equivalent Warming Impact (TEWI) measure should not be arequired component in chiller project proposals since it does not add sufficientinformation to warrant the time and expense of calculating it. Approximate TEWIcalculations of the chiller sector are recommended for the determination of theaggregate environmental impact of potential refrigerant substitution scenarios.

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APPENDIX II

COST-EFFECTIVENESS OF OPTIONS TOREDUCE OZONE DEPLETING SUBSTANCES:

CHILLERS AND MOTOR VEHICLE AIRCONDITIONERS

by

Bernard EydtPeter Linquiti

ICF Incorporated

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APPENDIX III

OORG OORG PublicationsReportNo.:

1. First OORG Refrigeration Working Group, "Reducing ODS Use by DevelopingCountries in Refrigeration", World Bank, Washington, D.C., October 1992.

2. First OORG Foams Working Group, "Reducing ODS Use in Foam-Blown Pre-Insulated Pipes (with particular reference to Poland) ", World Bank, Washington,D.C., December 1992.

3 . First OORG Refrigeration/Freezer Insulating Foams Working Group, "ReducingOzone Depleting Substance Use in Developing Countries in DomesticRefrigerator/Freezer Insulating Foams ", World Bank, Washington, D.C., October1993.

4 . First OORG Production Working Group, "Technical Considerations forChlorofluorocarbon Alternatives Production in Developing Countries ", WorldBank, Washington, D.C., October 1993.

5 . Fourth OORG Meeting, "The Status of Hydrocarbon and Other FlammableAlternatives Use in Domestic Refrigeration ", World Bank, Washington, D.C.,October, 1993.

6. OORG Production Sector, "CFC-12 to HCFC-22 Plant Conversion: OORGProduction Sector Case Study ", World Bank, Washington, D.C., February 1994.

7. Second OORG Refrigeration Working Group, "Domestic Refrigeration RefrigerantAlternatives", World Bank, Washington, D.C., May 1994.

8. Second OORG Foam Pre-Insulated Pipe Working Group, "Zero ODS Foam Pre-Insulated Pipe Alternatives ", World Bank, Washington, D.C., May 1994.

9. Second OORG Refrigerator/Freezer Foam Working Group, "Transitional and ZeroODS Domestic Refrigerator/Freezer Insulating Foam Alternatives ", World Bank,Washington, D.C., May 1994.

10. First OORG Chiller Working Group, "Chiller Refrigeration ODS Phase-outAlternatives", World Bank, Washington, D.C., July 1994.