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Natural Refrigerants Market to Reach USD 2.68 Billion by 2031 Owing to Growing Demand for Environmentally Friendly Solutions

The global Natural Refrigerants Market is experiencing significant expansion, according to a recent report by SNS Insider. The market size was valued at USD 1.62 billion in 2023 and is projected to reach USD 2.68 billion by 2031, growing at a CAGR of 6.4% over the forecast period (2024-2031).

Growing Demand for Green Cooling Technologies

“Green cooling” technologies are gaining traction across various sectors. Natural refrigerants like R600a (isobutene) and R290 (propane) are already used in 50% of newly produced refrigerators. Unitary air conditioning, the fastest-growing RAC subsector, is witnessing positive changes due to the widespread adoption of inverter technology. Major economies like China and India are introducing R290-based UAC systems, further driving market growth. Businesses are also recognizing the cost-saving benefits of green cooling. For example, Coca-Cola transitioned to HFC-free systems, reducing electricity use by 35% through intelligent energy management.

Natural refrigerants, derived from natural processes, offer numerous advantages. They have zero or near-zero global warming potential (GWP) and can reduce energy, gas, and water consumption. Switching to natural refrigerants is a crucial step towards sustainable cooling solutions and mitigating the environmental impact of traditional refrigerants. Hydrocarbons like propane (R290), propylene (R1270), butane (R600), and isobutene (R600a) are emerging as long-term alternatives for residential air conditioning and heat pumps, offering excellent performance and environmental benefits.

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Some of the Key Players Included are:

Puyang Zongwei Fine Chemical Co. Ltd, Sinochem, A-Gas International, Airgas Inc, Linde Group, Shangdong Yueon Chemical Co Ltd, Emerson Electric Co, GEA Group AG, Cooltech Applications, Carel Industries S.P.A., Danfoss A/S, and other key players are mentioned in the final report.

Several recent developments underscore the increasing momentum in the natural refrigerants market

  • In March 2023, Danfossacquired BOCK GmbH, a leading manufacturer of compressors for natural refrigerants like hydrocarbons and CO2, accelerating the global shift towards low-GWP solutions.
  • In February 2023, Lindesigned a significant agreement to supply clean hydrogen and nitrogen for a new blue ammonia plant in Texas, supporting the development of a sustainable cooling infrastructure.
  • In October 2022, A-Gas International Ltd.joined the Climate and Ozone Protection Alliance (COPA), demonstrating their commitment to promoting sustainable refrigerants and efficient lifecycle management practices.

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Segment Analysis

By Type, the hydrocarbons segment is expected to dominate due to their non-toxic nature, zero ozone depletion potential, and minimal impact on global warming. They offer excellent thermodynamic properties, making them a viable alternative to traditional refrigerants.

By Type

  • Ammonia
  • Carbon dioxide
  • Hydrocarbons

By Application

  • Industrial
  • Domestic
  • Commercial

Impact of Global Events

The Russia-Ukraine War has disrupted supply chains for key components and raw materials used in natural refrigerant production. Additionally, rising energy prices could impact the adoption of energy-efficient natural refrigerant systems. However, long-term, the war could also accelerate the adoption of alternative refrigerants as a hedge against energy price volatility.

A potential economic slowdown could dampen market growth in the short term. Reduced consumer spending and business investment could lead to a decline in demand for new appliances and refrigeration systems. However, the long-term outlook remains positive, driven by the increasing focus on sustainability and environmental regulations that restrict the use of traditional refrigerants.

Regional Landscape

Europe held the largest market share in 2023 due to its thriving commercial and automotive industries, driving demand for air conditioners and refrigeration systems. Stringent EU policies phasing out F-gases are prompting a shift towards natural refrigerants in heat pumps. Asia Pacific region is the fastest-growing market, driven by rising air conditioner adoption due to hot climates and growing disposable incomes. Additionally, the presence of low-cost manufacturing facilities is attracting companies to set up bases in the region.

Key Takeaways for the Natural Refrigerants Market Study

  • The market is driven by growing concerns about the environmental impact of traditional refrigerants and rising demand for sustainable cooling solutions.
  • Natural refrigerants offer advantages like low GWP and energy efficiency, promoting their adoption across various applications.
  • Regional regulations and industry trends will significantly influence the future of the natural refrigerants market.
  • The report highlights the importance for businesses across sectors to adopt green cooling solutions. Doing so reduces environmental impact, and potentially offers cost savings and a positive brand image.
  • The report identifies significant growth potential within the natural refrigerants market.  It offers insights into key segments (hydrocarbons, industrial applications) as well as promising regional markets (Asia Pacific).
Natural Refrigerants Market
Natural Refrigerants Market

Table of Contents – Major Key Points

  1. Introduction
  2. Research Methodology
  3. Market Dynamics
  4. Impact Analysis
    • COVID-19 Impact Analysis
    • Impact of Ukraine- Russia war
    • Impact of ongoing Recession
  5. Value Chain Analysis
  6. Porter’s 5 Forces Model
  7. PEST Analysis
  8. Natural Refrigerants Market Segmentation, By Type
  9. Natural Refrigerants Market Segmentation, By Application
  10. Regional Analysis
  11. Company Profiles
  12. Competitive Landscape
  13. Use Case and Best Practices
  14. Conclusion

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