Homeowners See Rising Costs for New Air Conditioners

LENEXA, Kan. — The price of staying cool during a long, hot summer is going up for people repairing or replacing their air conditioners. Cooling contractors say a government mandate is to blame for sharply higher prices.

Many homeowners call for service when their air conditioner stops blowing cool air. The most common gas used in air conditioners costs 50 percent more now compared to 2011.

After 18 years of service, the air conditioner at a metro home stopped working and needs to be replaced. The new unit being installed costs thousands more than the one it’s replacing. That’s because it uses a new environmentally friendly refrigerant. The refrigerant doesn’t deplete the ozone but requires a lot more work.

“Outdoor unit, indoor cooling coil, typically the lines with refrigerant that connects the two, it has to be replaced as well,” said Steve Burbridge. “So, it’s not just replacing an outside unit anymore, which takes 4 – 6 hours, now it’s a whole system.”

The EPA has ordered manufacture of R-22 to stop. It’s the most common gas used in home air conditioners. The agency says R-22 has the potential to destroy the earth’s protective ozone layer. As availability of R-22 is limited, the price is skyrocketing making even a simple A/C recharge cost prohibitive for some homeowners.

The homeowner where the air conditioner is being replaced told FOX 4 she could’ve gotten a new A/C that uses the old refrigerant and saved some money. She said she decided to bite the bullet and buy a new system with new refrigerant because she likes the idea of it being safer for the environment.

“It does get costly to fill up a system now,” Burbridge said. “If it’s an older system, I say that if it’s out of warranty or older than 10 years or so, there is a known bad leak in the system. It probably should be replaced, otherwise you’re putting a lot of money into something with very diminishing returns.”

The new systems with ozone friendly refrigerant uses high pressure lines and are much more expensive. Burbridge said they top out at $20,000 depending on the home.

In addition to being good for the earth, Burbridge said the silver lining to the higher costs are the lower utility bills homeowners can expect with the new, energy-efficient systems.

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California Home Service Contract Association Reports: Value of Home Service Contracts Increases in Wake of EPA Proposal to Reduce Allowances of Freon(R)

VAN NUYS, Calif., May 17, 2012 (BUSINESS WIRE) -- As a steady increase in the price of a common air conditioning refrigerant prompts a spike in maintenance costs for homeowners across California and the nation, the California Home Service Contract Association (CHSCA) reports home service contracts are increasing in value.

On Jan. 1, 2010, the Environmental Protection Agency (EPA) placed a ban on the manufacture of new air conditioners using R-22, a refrigerant more commonly known as Freon(R), because of its ozone depleting effects. The use of R-22 was not banned, but allowances were dictated on its future manufacture and in order to service existing home air conditioners.

Then on Jan. 4 of this year, the EPA proposed a rule that, if adopted, would significantly reduce production and distribution of Freon(R) by as much as 50 percent. This has significantly increased, and in many cases, more than doubled the price of Freon(R) in recent weeks, according to the CHSCA.

"The majority of the time our industry repairs an existing air conditioning system, R-22 is involved in that repair," Jeff Powell, chairman of the CHSCA, said. "That means the cost of repairing air conditioners has gone up significantly. However, because home service contracts cover service and repair to existing systems, and providers have generally not increased the price of those contracts, the value to consumers has increased."

Home service contracts generally provide service, repair or replacement for items such as dishwashers, ovens, disposers, electrical and plumbing systems -- and most importantly, heating, ventilation and air conditioning systems. Many home service contract providers also offer a menu of optional items such as pool and spa equipment, well pumps, and free standing appliances such as refrigerators and clothing washers and dryers for an additional fee. Contracts do not cover pre-existing conditions, but provide service, repair or replacement for failures arising due to normal wear and tear during the contract period.

To learn more about home service contracts and providers in California, please visit http://www.homeservicecontract.org/california.htm .

About CHSCA
Members of the new CHSCA, which provide approximately 95 percent of all home service contracts in California, include 2-10 Home Buyers Warranty, American Home Shield Corporation, BPG Home Warranty, Fidelity National Home Warranty Company, First American Home Buyers Protection, HMS National/Cross Country Home Services, Inc., Home Security of America, Inc., Home Warranty of America, Inc. and Old Republic Home Protection Co., Inc.

About the National Home Service Contract Association
The NHSCA is a non-profit 501((C)) (6) industry trade organization of member companies serving home service contract providers and consumer interests throughout the United States. To learn more about the NHSCA and to find answers to the most common questions regarding the purchase of home service contracts, visit www.homeservicecontract.org .
SOURCE: California Home Service Contract Association

        
        For California Home Service Contract Association 
        Jeff Powell, 818-374-7477 
        Art Ansoorian, 805-653-1648

EPA freon policy raising prices, Lubbock A/C companies say

Consumers can reduce their costs by eventually replacing the old unit with a new one or keeping equipment repaired and leaky hoses fixed on older units.

Posted: May 3, 2012 - 5:52pm | Updated: May 4, 2012 - 12:30am

By Adam D. Younglubbockonline.com Copyright 2012 Lubbock Online. All rights reserved. This material may not be published, broadcast, rewritten or redistributed. May 3, 2012 - 06:52pm

EPA freon policy raising prices, Lubbock A/C companies say

AVALANCHE-JOURNAL

A decades-old Environmental Protection Agency policy aimed at eventually phasing out R-22 freon in hopes of preventing damage to the planet’s ozone layer is making an impact on consumers’ pocketbooks this year.

But Lubbock air-conditioning technicians have tips for consumers to curb the costs as prices rise.
Yearly EPA benchmarks set to phase out all production of Hydrochlorofluorocarbon-22, also known as R-22 freon, in the United States by 2020 have hit supply and availability particularly hard in 2012, and Hub City air-conditioning companies say they’re having to pass the costs along to
consumers — sometimes raising the cost of a refill from $20- to $40-plus per pound.

With cooling systems requiring up to eight pounds and sometimes more, that could mean an extra $160 or more per service just for R-22, said Greg Welch, co-owner of Lellem Welch Plumbing Heating & AC.

“In the past, we had some customers’ units where it was cheaper for them to put a little bit of freon in to top it off, but that’s just not the case anymore,” Welch said.

Both Welch and his father, co-owner Richard Welch, said they and every air-conditioning service they know of have noticed R-22 wholesale prices jump by 200 percent or more.

“We absorb some of that, but we have to pass it along to the consumer,” Greg Welch said. The Welches said they’ve held their price down to twice last year’s cost for R-22.

Greg Skarda, owner of Master Tech Heating & Air Conditioning, estimated his cost for R-22 is up 230 percent over last year.

He blamed the price hike in part on the reduced production set by the EPA and partly on distributors selling 30-gallon barrels of R-22 in lesser quantities than in the past.

Skarda said distributors, once able to offer discounts by selling 30-gallon drums in pallets of 20 or more, now sell the drums two or four at a time.

Increased R-22 prices along with higher costs for commodities used in repairs, such as copper and silver in solder, also affect the price of air-conditioning repairs, Skarda said.

Since shortly after scientists in the 1980s discovered the Hydrochlorofluorocarbons of R-22 likely damage the planet’s ozone layer, the EPA has recommended substitutes such as R-410A, a blend of hydrofluorocarbons that does not contribute to depletion of the ozone layer, but, like R-22, potentially contribute to global warming as a greenhouse gas, according to the EPA.

Since 2005, R-22 consumption in the United States has fallen by more than half, from 107,258 metric tons in 2005 to 42,974 in 2010, according to a statement from EPA spokeswoman Catherine C. Milbourn.

Data for 2011 was not available.

Both the Welches and Skarda said they have not noticed a difference in effectiveness between R-22 and 410-A, but both said the price of the replacement has become considerably cheaper.

“The 410 used to be more expensive, but its price hasn’t increased where R-22 has,” Skarda said.
The Welches said consumers can reduce their long-term costs for air conditioning by selecting a cooling unit using a compound like 410-A, which costs about $25 per pound.

Since 2010, the EPA has banned the use of R-22 in new residential cooling units, though some new units still are available without the R-22 coolant in them at purchase.

The consumer is forced to pay the difference.

Along with eventually replacing a cooling unit, the EPA and service providers recommend consumers still operating older units using R-22 have leaky hoses fixed and equipment repaired, rather than topping off their tanks.

Both Richard Welch and Skarda recommended homeowners keep their units' compressors clean and change air filters once per month to improve efficiency and increase the cooling system’s lifespan.

To comment on this story:
adam.young@lubbockonline.com • 766-8725
leesha.faulkner@lubbockonline.com • 766-8706


Source: Amount of HCFC-22 consumption in the U.S. as reported to the United Nations between 2005-2010 provided by the EPA.

West Bloomfield man busted for selling refrigerant on Craigslist without proper credentials

By Tresa Baldas

Detroit Free Press Staff

A West Bloomfield man’s posting on Craigslist landed him in federal court, facing a $5,000 fine. His crime? Trying to sell the refrigerant R-22, which is illegal to sell without proper credentials and training under federal law.

Douglas Mertz, 38, was sentenced before U.S. District Judge Denise Page Hood today for his 2009 Craigslist postings, which raised red flags among authorities.

One posting read: "If you cannot get R-22 on your own, no EPA card or license, we can do business," records show. Another posting stated: "I have virgin 30 lb jugs of R-22 that I will sell to anyone who can't otherwise get one for EPA or license reasons and the distributors deny you."

Mertz, who himself was certified, then obtained 10 containers of R-22 and sold them to a buyer who – unbeknownst to him – was an undercover federal agent. To conceal the illegal sale, Mertz prepared a document that falsely identified the buyer as an employee of his business.

"It is a serious offense to sell R-22 or other ozone-depleting refrigerants to people who haven't been trained to properly handle these substances,” said Randall Ashe, Special Agent in Charge of EPA's criminal enforcement program in Michigan.

“In this case, the defendant not only made this illegal sale, but went further and created a false document to cover his tracks. This case demonstrates that anyone who thinks breaking the law is worth the risk should think again."

According to the EPA, certain refrigerants, such as R-22 can, damage the earth's ozone layer if they are released to the atmosphere. Federal guidelines require that individuals who work with ozone-depleting refrigerants like R-22 are trained to properly handle the substances and minimize their release to the atmosphere.

As part of his sentence, Mertz was required to surrender his EPA certification, which allowed him to purchase and work with refrigerants such as R-22.

He was fined $5,000 for delivering a false document regarding a hazardous material. He also was sentenced to one year probation, and ordered to pay restitution up to $750.

Mertz's accomplice, Wasim Ibrahim Bony, was sentenced on April 19 for aiding and abetting Mertz in making and delivering a false document. He was fined $1,500, and ordered to pay up to $750 in restitution.