CCM: 1000 sets of R290 room air conditioners used by Jiaxing Nanyang Polytechnic Institute 09-28-2016

On 3 June, 2016, Jiaxing Nanyang Polytechnic Institute (JNPI) held a ceremony in Jiaxing City, Zhejiang Province, for signing a contract with Guangdong Midea Refrigeration Equipment Co., Ltd. (Midea Refrigeration Equipment) about the purchase of room air conditioners.



Source: Baidu


Accordingly, the contract is targeted at 1,000 sets of propane (R290) room air conditioners, all flexible frequency ones with EEI (= energy efficiency index) at Grade 2. Advanced technologies for low carbon, high efficiency and energy saving are adopted.


Leaders and representatives from the Foreign Economic Cooperation Office, Ministry of Environmental Protection, United Nations Industrial Development Organization, China Household Electrical Appliance Association, Jiaxing municipal government and Zhejiang Environmental Protection Bureau attended the ceremony. A title “R290 Room Air Conditioner Demonstration Base” was awarded to JNPI.


The purchase is expected to bring demonstration effect to the market, to further improve consumers’ acceptance and recognition and accelerate the marketisation, and to finally follow the government’s environmental policies, according to analyst CCM.


                                             


China is the globally largest household air conditioner producing, consuming and exporting country. In 2015, the national output surpassed 110 million units, nearly 80% of the global total. Of this, about 40% were for exports.


In regard to refrigerant, now difluorochloromethane (HCFC-22) and R410a (a mixture of difluoromethane - HFC-32 and pentafluoroethane - HFC-125) are mainly applied in the domestic made room air conditioners. However, the prospects are not optimistic.


Accordingly, the Montreal Protocol on Substances that Deplete the Ozone Layer specifies to speed up the HCFC-22 elimination. Meanwhile, the use of R410a, a hydrofluorocarbon (HFC) highly GWPed (GWP= global warming potential), has been restricted or reduced by developed countries/regions such as the EU, the US and Japan.  


Also, China is actively participating in international meetings and is planning to list HFCs in the Montreal Protocol on Substances that Deplete the Ozone Layer. This indicates that R410a will be eliminated in the future.


China has chosen R290 as a substitute. In recent years, it has vigorously promoted the reconstruction projects, to have 18 R290 room air conditioner production lines and 4 R290 compressor production lines in total nationwide. Accordingly,


  • April 2015 - leading companies in succession launched R290 room air conditioners
  • June 2016 - Shenzhen University signed with Gree Electric Appliances, Inc. of Zhuhai about the purchase of the domestic first batch of R290 room air conditioners (243 units in total)


Now the sales of R290 room air conditioners are mainly reliant on orders from government and universities especially. Still it is a long period to achieve marketisation. However, in view of the domestic refrigerant market trend, R290 segment is growing for better.


By June 2016:


- Price (quotations)

  • HCFC-22: about USD1,518/t (RMB10,000/t)
  • R410a: about USD2,702/t (RMB17,800/t)
  • R290: about USD1,320/t (RMB8,700/t)


- Profit margin

  • HCFC-22: around USD379/t (RMB2,500/t)
  • R410a: around USD197/t (RMB1,300/t)
  • R290: around USD637/t (RMB4,200/t)


In this context, air conditioner manufacturers will benefit from low price R290. Refrigerant producers, attracted by high profit, will increasingly develop R290 business.

  

This article comes from China Fluoride Materials Monthly Report 1606, CCM

 



About CCM:

CCM is the leading market intelligence provider for China’s agriculture, chemicals, food & ingredients and life science markets. Founded in 2001, CCM offers a range of data and content solutions, from price and trade data to industry newsletters and customized market research reports. Our clients include Monsanto, DuPont, Shell, Bayer, and Syngenta. CCM is a brand of Kcomber Inc.

 

For more information about CCM, please visit www.cnchemicals.com or get in touch with us directly by emailing econtact@cnchemicals.com or calling +86-20-37616606.

 

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