Extremely climate-damaging refrigerants for air conditioning systems often reach Europe illegally. The smuggling calls into question the EU’s strategy to promote environmentally friendly alternatives.
At the beginning of July, the EU anti-fraud authority, Olaf for short, achieved a great success for climate protection : the investigators seized 14 tons of so-called partially fluorinated hydrocarbons (HFCs) from China that were supposed to be illegally imported into the EU in the port of Rotterdam. These chemicals serve as refrigerants, for example for air conditioning systems or refrigerators and freezers – and are extremely harmful to the climate: If they get into the atmosphere, depending on their chemical composition, they contribute around 700 to 3900 times as much to global warming as the same amount of carbon dioxide.
The Rotterdam find is not an isolated incident. For several years now, EU investigators or customs authorities have repeatedly come across containers with smuggled refrigerants, mostly from China. On the other hand, there are many illegal imports that go undetected. The European Technical Committee for Fluorocarbons (EFCTC) – an association of European manufacturers – estimates that the black market for HFC refrigerants is up to a third of the legal market. This is shown by a new analysis, commissioned by the EFCTC, of import and export data from China and the EU as well as imports from neighboring EU countries.
Organized crime is probably behind it
“We strongly suspect that this is mainly due to organized crime. The large amounts suggest that,” says Felix Flohr of the manufacturer Daikin Chemical Europe on behalf of the EFCTC. The British environmental protection organization Environment Investigation Agency has also observed brisk trade in illegal HFCs, but has come up with lower numbers. In a 2018 study, she put the volume of the black market at around one sixth of the legal market.
“How much refrigerant is now being illegally imported into the EU cannot be precisely quantified, as the comparison of import and export data is only of limited meaning,” says Diana Thalheim from the Federal Environment Agency (UBA). “However, it is undisputed that illegal trade is a serious problem for climate protection.” Because the black market undermines the EU’s efforts to reduce the use of HFCs. The EU’s “F-Gas Regulation” stipulates that the amount of climate-damaging refrigerants that can be sold in Europe is steadily falling. In terms of the greenhouse gas effect of chemicals, only two thirds of what was sold in 2015 is allowed today; by 2030 it should still be a good fifth. With smuggling, however, large quantities also enter the market.
Maintenance companies in particular buy from smugglers
In addition, illegal imports are torpedoing the EU’s strategy of using prices as a tax instrument. In the first three years after the 2015 ordinance came into force, the shortage of supply meant that common HFCs were eight to ten times more expensive. This made climate-friendly alternatives such as propane or ammonia more attractive. Since 2018, however, the prices for some HFCs have fallen by around half in some cases, explains Matthias Schmitt, Managing Director of the Federal Guild Association of the German Refrigeration Industry. “This is, it is often assumed, primarily due to the increase in illegal imports,” says Schmitt.
The smugglers mainly find buyers in companies that take care of the maintenance of air conditioning systems in buildings and vehicles. One of their tasks is to top up the refrigerant that escapes when the systems are in operation. Many buyers are probably well aware of the illegal origin of the products – there are some clear signs that point to black market trading. “A typical feature of illegally imported refrigerants is that they are sold in disposable containers,” says UBA expert Thalheim. “Another thing is the price: if it is well below the market price, you can be sure that they are being sold illegally.”
The contraband is even sold on Ebay
Customers should also take a close look at the seller. “If it is a private person or a company where it is not clear where it is based, one should refrain.” The sellers still seem so sure of their cause that they even use public e-commerce platforms such as Ebay for their business. There are always cylinders with HFC refrigerants of undeclared origin, for which there is apparently no take-back system. Inquiries to dealers about how and where empty containers can be returned remain unanswered.
The manufacturer association ETCFC assumes that the volume of illegally imported HFCs into the EU corresponds to a CO equivalent of up to 34 million tonnes. For comparison: Germany emitted a total of 805 million tons of CO₂ in 2019. How much contraband actually finds its way into the atmosphere cannot be said, however. Some of the refrigerants from the black market are rendered harmless when the systems and devices are disposed of. However, the quantities that escape through leaks during operation should not be underestimated. According to the Federal Environment Agency, air conditioning systems in cars, for example, lose around ten percent of their refrigerant every year, and those in buses as much as 15 percent. With modern large air conditioning systems, for example for office buildings or shopping centers, it is 3.2 percent, with older systems it is six percent.
Good reasons for the Federal Environment Ministry to take more stringent measures against the illegal trade in HFCs. The ministry has drawn up a draft law which, among other things, provides for comprehensive documentation requirements throughout the supply chain. This should make it easier for the supervisory authorities to trace trade routes and punish criminal offenses. The ETCFC welcomes the law, but points out that its effectiveness ultimately depends primarily on how it is enforced and whether the penalties are sufficiently dissuasive. In the end, however, it is also important to be more aware of the problem, says Felix Flohr – “if no one purchases illegal goods anymore, the black market also loses its foundation”.