Real Estate Round-Up: phasing out R-22

When we think about “green” initiatives or environmentally friendly approaches, we generally think about clean air, water and land.

Recently, the state’s legislative branch has passed laws that focus, to a greater extent, on property owners. Many of the initiatives, at first glance, appear to be burdensome, but over the long haul, will improve and/or sustain the quality of life we all enjoy in California. As we modify and adapt our homes, to meet the revised standards, we are also improving the value of one of our biggest assets.

California is leading the nation when it comes to creating a “greener” earth. In 2018, Governor Jerry Brown signed Senate Bill 100, that eliminated fossil fuels from the state’s electric grid by 2045. California consumes 206 billion kilowatt hours of electricity per year. That is more than Indonesia’s population of 240 million consume.

Natural gas provides more than a third of the states power generation, which is down from 40% just two years ago. California has the political will for a greener grid, with over two-thirds of the residents supporting the state enacting its own climate-change policies, above and beyond the federal mandates.

California has one of the most ambitious environmental energy regulations in the United States, which includes the only economy-wide emissions cap-and-trade program in the nation. This program requires that 33% of retail sales of electricity come from renewable resources (wind, solar, geothermal, and biomass) by 2020 and 50% by 2050.

Cap and trade works like this. There are emission caps, that decline yearly. These caps limit the harmful emissions allowed by large electricity power plants, large industrial plants and fuel distributors. There are approximately 450 businesses included in this group. They produce approximately 85% of California’s greenhouse gas emissions. Each company receives an allocation of emissions, either through distribution or through quarterly auctions.

These companies can “trade” or “bank” any unused allocations. If a company is able to reduce their emissions below what is required, they can bank their unused allocation for the future, when the guidelines are stricter, or they can “trade” them to a company that has not been able to meet their requirements, and receive compensation for that relinquished allocation.

Closer to home, homeowners will be required to phase out R-22, freon. In 1994, automobile companies were required to replace R-12 with R-134a, because the new refrigerant decreased the ozone depletion by over 85%.

In homes, R-22 was the refrigerant used to produce cool air by compressing warm air sources into liquid through HVAC coils. Under the Clean Air Act of 1990, the United States began to outline a phase out for the use of R-22 that would unfold slowly over the course of 20 years.

On January 1, 2020, there will be a ban on production and import of R-22. Existing HVAC units that use R-22 will rely on any remaining stockpiles when service is needed. By January 1, 2030, there will be a complete ban on R-22 and the remaining stockpiles, as well as the importation of R-22.

What does this mean for you? As a homeowner, you are not required to stop using R-22 air conditioners, nor are you required to replace existing equipment. Homeowners should keep in mind that as supplies of R-22 becomes limited over time, they may experience an increase in price. Also, when it comes time to repair or replace your existing older unit, you might want to choose the latter.

The new energy efficient units use EPA-approved refrigerants, such as R410A. It is a non-ozone-depleting refrigerant. It is considered to be neutral to the environment and sold under the names such as, Puron, Gentron AZ-20 and SUVA.

If you have a home warranty, some companies will cover the conversion of the system, when deemed necessary. The typical replacement cost may be more than $5000. It might not seem like January 2030 is very close, but when I consider it was just yesterday that we were all concerned about Y2K, which is now nearly 20 years ago, perhaps a little proactive replacement would be a wise choice to make.

Kim Murphy can be reached at [email protected] or (760) 415-9292 or at 130 N Main Avenue, in Fallbrook. Her broker license is #01229921, and she is on the board of directors for the California Association of Realtors.