Honeywell's HFO-1234yf refrigerant has a GWP of less than 1, a 99.9% reduction compared to HFC refrigerants currently used in the Chinese market.

(Image credit: CnEVPost)

At a time when China's new energy vehicle (NEV) industry is growing rapidly, automakers are making increasing efforts to protect the environment.

Honeywell International Inc (NASDAQ: HON) is working with Nio (NYSE: NIO, HKG: 9866, SGX: Nio) to supply its flagship ET7 sedan with HFO-1234yf refrigerant, which has an ultra-low global warming potential (GWP), the US industrial conglomerate said.

The partnership makes Nio the first automaker to use HFO-1234yf, a refrigerant for automotive air conditioning systems that is a hydrofluoroolefin (HFO) in the Chinese market, according to a press release issued Tuesday by Honeywell.

HFO-1234yf refrigerant has a GWP of less than 1 and a 99.9 percent reduction in GWP compared to hydrofluorocarbon (HFC) refrigerants currently used in the Chinese market, Honeywell said, adding that it could help automakers meet increasingly stringent regulatory requirements for automotive air conditioning refrigerants.

HFO-1234yf refrigerant is an energy-efficient and safe alternative for automotive air conditioning applications that meets existing industry standards and is proven in automotive design, engineering and service.

By the end of 2021, HFO-1234yf refrigerant has been used in more than 120 million vehicles worldwide, Honeywell said, adding that the number is expected to reach about 185 million by the end of this year.

(Image credit: CnEVPost)

HFC-134a refrigerant, the so-called third-generation refrigerant, is commonly used in cars sold in China. HFO-1234yf, as a replacement for HFC-134a, is a fourth-generation refrigerant.

At present, the third-generation refrigerant has not been completely banned, so it is somewhat difficult to market the fourth-generation alternative, said an executive of a refrigerant manufacturer quoted by Shanghai Securities News in a report today.

One of the main reasons is the high cost, with a Honeywell source telling CnEVPost that the fourth-generation refrigerant is about 10 times more expensive than HFC-134a.

However, increasingly stringent environmental requirements worldwide are driving the use of environmentally friendly refrigerants.

The Kigali Amendment to the Montreal Protocol, adopted on October 15, 2016, brings high-GWP hydrofluorocarbons (HFCs) under regulation. The amendment came into force in China in September 2021.

With the Kigali Amendment in effect in China, the trend is for the country's automotive industry to strengthen controls on non-CO2 greenhouse gases such as HFCs in response to carbon neutrality and peak carbon targets, said Liu maoshu, vice president of Honeywell characteristic materials and technology group and general manager of Asia Pacific region.

Nio is ahead of the curve in China on removing 134a from local market vehicles. The company is doing this because it's good for the environment and their customers, the Honeywell source said, adding the EV maker has decided that yf is their choice for the next generation 134a replacement like the rest of the world has.

For Nio, its targeting of the high-end market is another important factor that enabled the company to be the first to use HFO-1234yf refrigerant in China.

Nio is currently the only local Chinese automaker with a firm foothold in the high-end car market, with its vehicles selling for an average price of over RMB 400,000 ($59,760), comparable to Mercedes-Benz and BMW.

The Nio ET7, which began deliveries in late March, started at RMB 448,000 and was raised by RMB 10,000 to RMB 458,000 on May 23.

In contrast, most other local Chinese brand vehicles are priced below RMB 200,000, for which they obviously cannot afford the current high price of HFO-1234yf refrigerant.