The Natural Refrigerant Market was valued at US$ 1.6 billion in 2022 and it is anticipated to grow up to US$ 2.9 billion by 2032, at a CAGR of 6.1% during the forecast period.

A natural refrigerant is a chemical obtained from natural sources, which include ammonia, water, or carbon dioxide, that has favorable thermodynamic heat transfer qualities and is utilized in air conditioning and refrigeration systems. It has a low or zero ozone-depleting potential (ODP) and a low global warming potential (GWP), which makes it a greener option to synthetic refrigerants. Natural refrigerants have a low environmental effect and so provide a sustainable and energy-efficient cooling option.

Natural Refrigerant Market Scope and Report Structure

Market Drivers and Trends

The increasing stringency of government regulations are propelling the market growth. Ozone-depleting substances (ODS) are classed as class I or class II banned chemicals in the United States, according to the Environmental Protection Agency (EPA). Class I compounds, such as chlorofluorocarbons (CFCs) and halons, have a higher ozone depletion potential and, with a few exceptions, have been phased out in the United States. As a result, no class I chemicals can be manufactured or imported. Class II compounds are all hydro chlorofluorocarbons (HCFCs), which act as substitutes for a variety of class I substances. The bulk of HCFCs were forbidden from manufacturing and import as of 2020. As a result, such laws are expected to increase demand for natural refrigerants.

Furthermore, increasing awareness regarding environment-friendly refrigerants is likely to drive market growth during the projected period. Natural refrigerants form naturally through biological and chemical processes without human intervention. Natural hydrocarbons, carbon dioxide, water, and air have zero or near-zero GWP and may be used to minimize energy, gas, and water use. Switching to natural refrigerants that are better for the environment’s long-term growth constitutes one of the most efficient strategies to reduce greenhouse gas emissions. These drivers are likely to propel market expansion.

Market Restraints and Challenges

Using combustible gas is usually dangerous. Propane or natural gas is utilized for cooking and heating in many households. The purpose of a heat pump using a flammable refrigerant is to keep the refrigerant contained within a sealed system. Unlike refrigerators, which are controlled by International Electro technical Commission (IEC) regulations that allow up to 150 grams of flammable refrigerant, heat pumps that operate with flammable refrigerant charges more than 150 grams are not governed by any standards. Certain agencies have concluded that the danger of using flammable refrigerants is permissible if certain measures are followed. The cost may be limited depending on the size of the room. The heat pump installation compartment must be well-ventilated. In the case of a spill, there may be no components that can ignite. As a result, the dangers related to flammable refrigerants may stifle the expansion of the natural refrigerants industry. Hence, these factors are expected to restrain growth of the market during the forecast period.

Natural Refrigerant Market Segmental Overview

The report analyses the Natural Refrigerant Market based on type, application, and region.

Natural Refrigerant Market by Type

Based on type, the Natural Refrigerant Market is segmented into carbon dioxide, ammonia, hydrocarbons, and others. The hydrocarbons segment is further sub-segmented into propane, isobutene, ethane, ethylene, propylene, and others. The carbon dioxide segment is expected to dominate the market during the forecast period. Under normal conditions, carbon dioxide (CO2) is a colorless, odorless, heavier-than-air liquid. It is classified as an excellent refrigerant since it is non-toxic and inflammable. Because their ODP (Ozone Depletion Potential) is zero, CO2-based refrigerants have no impact on the ozone layer. However, it might be argued that since it is a byproduct of industrial operations, it would have been emitted into the atmosphere otherwise. Carbon dioxide is one of the most common gases used in supermarket refrigeration as a substitution for synthetic refrigerants.

The fastest-growing category in this area is ammonia. Ammonia is gaining appeal as a natural refrigerant due to its outstanding thermodynamic features, negligible ozone depletion possibility, and low global warming potential. Because of its high heat transfer coefficient and energy efficiency, it is an excellent substitute to synthetic refrigerants for industrial and commercial refrigeration systems.

Natural Refrigerant Market by Application

By application, the market is classified into refrigerators, air conditioning systems, and others. Based on refrigerators, the segment is further divided into industrial, commercial, domestic, and others. Similarly, the air conditioning systems segment is further sub-segmented into stationary, chillers, heat pumps, and others. The refrigerators segment dominated the market in 2022 in terms of revenue and is expected to be the fastest growing segment during the forecast period. There are many different types, including industrial, household, and others. For a brighter future, there is an urgent need to seek pure, eco-friendly refrigerants. The hunt for refrigerants that do not deplete the ozone layer or contribute to global warming has raised the desire for natural refrigerants such as CO2, NH3, and hydrocarbons, which are often used in refrigerators.

Regional Analysis of Natural Refrigerant Market

Region-wise, it is studied across North America, Europe, Asia Pacific, and the Rest of the World. Europe has the biggest market share in terms of Natural Refrigerant Market value followed by North America. This is due to the The surge in demand for natural refrigerants in Europe can be attributed to tight environmental restrictions that have curtailed the usage of hydrofluorocarbon (HFC) refrigerants. Europe is expected to be the fastest-growing area in the market owing to the region’s high rate of natural refrigerant consumption by end users. Furthermore, the market for refrigerants in this region is expected to grow as a result of the country’s improved level of living. Natural refrigerants use less energy, have less leakage, and are less costly than fluorocarbons. According to the Air Conditioning and Refrigeration European Association (AREA), the European Association of Refrigeration, air conditioning, and heat pump (RACHP) contractors, yearly turnover has surpassed $26.27 billion in 2020.

Major Players in the Natural Refrigerant Market

The key players studied in the global Natural Refrigerant Market are HyChill Australia Pty Ltd, A-Gas International Ltd, AGC Inc. , Evonik Industries AG , Daikin industries ltd., Air Liquide, Linde Plc, Puyang Zhongwei Fine Chemical Co., Ltd, Danfoss AS , and Johnson Controls International plc among others.

COVID-19 Impact

The COVID-19 pandemic has had a negative influence on every element of the global economy, including the market. Due to the pandemic, the refrigerant business has been through its worst period in recent years. The worldwide refrigerants sector experienced effects such as raw material shortages, logistical issues, work force shortages, and uncertainty, which led to the halting or shutdown of production facilities. Several players in the refrigerant business encountered issues such as fewer alternatives, increased material prices, and prolonged project cycles. Furthermore, ammonia and hydrocarbon manufacturers experienced crippled demand and stopped corporate operations. To protect their employees, market participants were required to implement additional safety precautions and maintain acceptable COVID behavior.

Recent Developments

• On March 2023, Danfoss announced the acquisition of BOCK GmbH, a producer of carbon dioxide and low-GWP compressors. BOCK GmbH possessed one of the most diverse natural refrigerant compressor portfolios, comprising hydrocarbons, CO2 (R744), and other low-GWP refrigerants. The agreement has advanced energy efficiency and the global transition to low-GWP and natural refrigerants.
• On February 2023, Linde engaged in a long-term agreement and committed to supplying clean hydrogen and nitrogen to OCI’s upcoming world-scale blue ammonia factory in Beaumont, Texas. The Beaumont project aspires to enhance and improve the world’s leading platform for blue ammonia and clean fuels.
• On October 2022, A-Gas International Ltd. has announced its membership in the Climate and Ozone Protection Alliance (COPA). The alliance aims to shift the cooling sector to more environmentally friendly refrigerants and to build better refrigerant lifecycle management. The strategy was designed to accelerate the growth of natural refrigerants and provide effective environmental solutions to the global market.
• On December 2022, The new separators at A-Gas went into service in early 2023, with more than double the separation capacity of the current facility, fulfilling a substantial need indicated by the NGO research.
• On August 2019, Linde AG, a German industrial gas manufacturer, has completed its purchase of its South India business to Japan’s Air Water Inc. (AWI) as a part of its global merger with Praxair Inc., located in the United States.

Natural Refrigerant Market Report Coverage

• The report offers a comprehensive quantitative as well as qualitative analysis of the current Natural Refrigerant Market outlook and estimations from 2022 to 2032, which helps to recognize the prevalent opportunities.
• The report also covers qualitative as well as quantitative analysis of Natural Refrigerant Market in terms of revenue ($Billion).
• Major players in the market are profiled in this report and their key developmental strategies are studied in detail. This will provide an insight into the competitive landscape of the Natural Refrigerant industry.
• A thorough analysis of market trends and restraints is provided.
• By region as well as country market analysis is also presented in this report.
• Analytical depiction of the Natural Refrigerant Market along with the current trends and future estimations to depict imminent investment pockets. The overall Natural Refrigerant industry opportunity is examined by understanding profitable trends to gain a stronger foothold.
• Porter’s five forces analysis, SWOT analysis, Pricing Analysis, Case Studies, COVID-19 impact analysis, Russia-Ukraine war impact, and PESTLE analysis of the Natural Refrigerant Market are also analyzed.

Frequently Asked Questions

Q1. How big is the Natural Refrigerant Market?

Ans. The Natural Refrigerant Market size was US$ 1.6 billion in 2022 and is anticipated to reach US$ 2.9 billion in 2032, growing at a rate of 6.1% from 2022 to 2032.

Q2. What is the Natural Refrigerant Market growth rate?

Ans. The growth rate of the Natural Refrigerant Market is 6.1% from 2022 to 2032.

Q3. Which region holds a major market share for the Natural Refrigerant Market?

Ans. Europe holds a major market share of the Natural Refrigerant Market in 2022.

Q4. Which segment accounted for the largest Natural Refrigerant Market share?

Ans. Based on type, the Natural Refrigerant Market is segmented into carbon dioxide, ammonia, hydrocarbons, and others. The carbon dioxide segment is expected to dominate the market during the forecast period.

Q5. Who are the key players in the Natural Refrigerant Market?

Ans. The global Natural Refrigerant Market report includes players such as HyChill Australia Pty Ltd, A-Gas International Ltd, AGC Inc. , Evonik Industries AG , Daikin industries ltd., Air Liquide, Linde Plc, Puyang Zhongwei Fine Chemical Co., Ltd, Danfoss AS , and Johnson Controls International plc among others.

Q6. What are the factors driving the Natural Refrigerant Market growth?

Ans. The major factor driving the growth of the market are the increasing stringency of government regulations and increasing awareness regarding environment-friendly refrigerants.

Q7. What are the key growth strategies of Natural Refrigerant Market players?

Ans. The key growth strategies of Natural Refrigerant Market players are product launch, partnerships, and government initiatives.

Q8. Which region will provide more business opportunities for the Natural Refrigerant Market during the forecast period?

Ans. The Europe region will provide more business opportunities for the Natural Refrigerant Market during the forecast period.