Honeywell expects double-digit growth in the Middle East as region becomes energy-efficient
The American multinational Honeywell expects its advanced materials segment to grow by double digits in the Middle East, as the region prepares to phase in more energy-efficient technology as part of diversification efforts.
“Our growth in the next fiveor seven-year period is expected to be double-digit because we expect a rapid adoption of new refrigerant technologies,” said George Koutsaftes, the president of Honeywell Advanced Materials.
“Today in the Middle East there is a diminishing use of HCFCs [hydrochlorofluorocarbons] that are harmful for the ozone and we’re seeing a transition away from those, which is good, so the region is using less refrigerants that are harming the ozone layer,” he said.
“But they’re still using a lot of HFCs that are global warmers and current HFC technology for refrigerants could ... [have] 2,000 or 3,000 times the CO2 [carbon dioxide] content of CO2 itself. From an emissions point of view, it will remain in the atmosphere for hundreds of years.”
HCFCs – which have commonly been used in cooling systems and chillers around the world – are blamed for the creation of a hole in the Earth’s protective ozone layer. Since the discovery of their harmful nature, the United Nations ratified a treaty called the Montreal Protocol on Substances that Deplete the Ozone Layer in 1987 to phase out their use.
Speaking at last month’s UN climate change conference in Bonn (COP 23), Frank-Walter Steinmeier, the German president, called for urgent action on climate change following last year’s Paris Agreement climate accord within the UN Framework Convention on Climate Change dealing with greenhouse gas emissions mitigation, adaptation and finance starting in the year 2020.
“The Paris Agreement will only have been a real breakthrough if the agreement is followed up with real action. Constructive, multilateral work under the umbrella of the UN is the only way forward,” Mr Steinmeier said.
Equally harmful greenhouse gas-generating HFCs have since been replaced in countries that heavily use refrigerants, such as in the Middle East.
The Gulf states remain some of the most heavily climate-controlled regions of the world with air-conditioning demand rising during peak summer. At a meeting last year in the Rwandan capital Kigali, an amendment was incorporated to also eliminate the use of HFCs.
The amendment calls for developed nations to slash their HFC consumption levels by at least 85 per cent of their annual average values for the period 2011-13, while countries in the Middle East such as Saudi Arabia and Kuwait will be required to phase them out by the same proportion based on their annual averages between 2024 and 2026, by 2047.
The region’s gradual reduction of energy subsidies is likely to drive future growth in an emerging segment for efficient and environmentally-friendly energy consumption, said Mr Koutsaftes.
“The phase-out of subsidies is a key driver for the appetite that the industry has for the solutions that are reducing energy consumption,” he said.
“Adopting the new refrigerants comes part and parcel with it being designed into new equipment that are much more efficient in their energy consumption profile and this is what the region needs. It absolutely needs this to achieve its ability to roll back subsidies and reduce energy consumption,” he added.
In the region, Honeywell preworks with the Dublin air-conditioning equipment and systems manufacturer Trane to deploy more energy-efficient technology and with Abu Dhabi’s Masdar City as well as in Al Ain, where it deploys environmentally friendly insulation in buildings.
The firm is currently eyeing projects in Saudi Arabia and is looking to develop local manufacturing capabilities to support future demand for less ozone-depleting refrigerants.
“We’re having multiple conversations with several participants. What we want to do is to ensure that we enable the region to achieve its objectives and if that means that the demand supports the need for investment, then we’ll make that work,” said Mr Koutsaftes.