Retail Strategies for Achieving CARB Compliance

A global phasedown of hydrofluorocarbon (HFC) refrigerants is currently underway. On a national level, the Environmental Protection Agency (EPA) has introduced mandates that will drive the transition to lower-global warming potential (GWP) alternatives in the coming years. But for retailers in California, this transition started several years ago. In 2022, the California Air Resources Board (CARB) finalized regulation that requires the state’s retailers to reduce the GWP and/or greenhouse gas (GHG) emissions in their store fleets. In a recent article for Today’s Grocer, I reviewed strategies for calculating and achieving CARB compliance.

New versus existing stores

The first thing to understand about complying with CARB mandates is that all new refrigeration systems containing more than 50 pounds of refrigerant installed in new facilities will be required to use refrigerants with less than 150 GWP. Considering that most of today’s installed refrigeration systems are based on centralized, direct-expansion (DX) racks charged with thousands of pounds of high-GWP HFC refrigerants (R-404A has a GWP of 3,922), this is a significant change. Simply put, the installation of new large HFC-based refrigeration systems is no longer permitted in California.

For existing facilities within California, CARB compliance can be achieved by factoring in the refrigeration footprint of equipment charged with more than 50 pounds of refrigerant across a retailer’s entire fleet of stores. This includes existing stores that are undergoing new construction, retrofits and remodels. To help retailers avoid the costs of full-system replacements, CARB has provided two fleet-wide methods of compliance based on either the weighted-average GWP (WAGWP) or the GHG potential (GHGp) of their entire fleet.

Calculating CARB compliance

Although either path to compliance has its advantages, retailers will need to literally do the math to determine which approach aligns with their refrigeration preferences and operational objectives.

Option/equation 1: WAGWP reduction <1,400 GWP — This option requires retailers to reduce their statewide WAGWP for all refrigeration systems (within all stores they are operating in California) that contain more than 50 pounds of refrigerant to less than 1,400 GWP by 2030.

WAGWP is the sum of the total refrigerant charge, multiplied by the GWP values of the refrigerants in use, divided by the total refrigerant charge.

By aiming for that fixed target, this approach offers the following potential advantages to retailers:

• No requirement to track progress against a 2019 baseline
• Flexibility to choose which systems and stores to retrofit
• Rewards conversion to lower-GWP refrigerants in existing stores

However, retailers may need to apply this equation to multiple retrofit scenarios to successfully deploy this strategy.

Option/equation 2: GHGp reduction by 55 percent — Under this option, retailers will need to reduce their statewide GHGp (within all stores they are operating in California) by 55 percent below their 2019 baseline before 2030. This approach offers the flexibility to reduce both refrigerant charge and GWP across a retail fleet of stores in whatever manner retailers may choose — so long as it meets the targeted 55 percent reduction by 2030. Again, this applies to all stores containing systems with more than 50 pounds of refrigerant.

GHGp is the sum of the total refrigerant charge multiplied by the GWP values of the refrigerants in use.

Under this approach, retailers will receive credits for both refrigerant charge and GWP reductions as they retrofit or build new stores. But they also must track and report each store’s 2019 GHGp baseline as well as document and verify equipment changes. Advantages include:

• Flexibility to make retrofit decisions about each individual store and system
• Rewards both refrigerant charge and GWP reductions

Systems charged with more than 50 pounds of refrigerant per the 2019 baseline will be factored into the 2030 calculation. If the total system charge falls below 50 pounds during retrofit or charge reduction, this also must be reported and will count as credit. For example, if a retailer replaces an older 500-pound centralized system with three distributed systems — each charged with 45 pounds of refrigerant — these systems will be included in the GHGp calculation and credit will be given for the charge reduction.

Making informed compliance decisions

Whether California retailers choose to meet the WAGWP target of 1,400 or reduce their GHGp by 55 percent, they will soon face extensive equipment decisions within their store fleets. But CARB compliance should also be weighed within the context of a retailer’s individual operational, financial and sustainability goals. And since any retrofit or new system installation will likely be in service for years to come, this starts with gaining a clear understanding of the system’s total cost of ownership (TCO).

Copeland has created an internal fleet analysis calculator to help retailers evaluate multiple compliance scenarios and develop long-term refrigeration strategies for their fleets. With this tool, we can input all the current refrigeration system data in your stores — including system type, refrigerant used, GWP value and charge — and then select equipment upgrade options to compare their relative impacts. Options include:

• Retrofitting to a lower-GWP refrigerant
• Installing new architectures (with lower-GWP refrigerants)
• Employing a hybrid approach that blends both retrofit and new

The fleet analysis calculator provides estimated WAGWP and GWP reductions based on inputs or assumptions of the following data points:

• WAGWP values of the upgrade
• GHGp reductions of the upgrade
• Estimated total capital expenditures
• Estimated cost per WAGWP reduction

To leverage our fleet analysis tool for your CARB compliance evaluations, please contact your Copeland sales representative. To learn more about CARB and the dynamic regulatory landscape, please visit our E360 resource hub.