Why Natural Refrigerants Are the Future of Industrial Cooling

Authors: Taylor Hendrix, Director of Engineering  |  Brian Cronk, President

For every industrial refrigeration plant, whatever the technology, design, or refrigerant employed, its operational mission can be boiled down to the basics: it converts electricity into cold. Simple mission, but widely variable in how it can be accomplished. The operational design, efficiency, safety and impact on the environment for each system is unique.

With current and oncoming federal regulations and an ever-increasing industry focus on sustainability, it’s time we began approaching industrial refrigeration with an “impact on the planet” perspective. It’s nothing new to progressive, technology-savvy refrigeration firms like PermaCold Engineering (PCE) and the nationwide group of commercial refrigeration and compliance experts we collaborate with as part of the Kelvin Group. Over the past four decades, researchers and industry innovators have recognized that older systems and outdated engineering approaches don’t just hurt the planet, they ultimately degrade the bottom line for refrigeration-reliant businesses.

As a long-time industry leader in highly energy efficient and “green” industrial refrigeration advances, PermaCold understands and knows how to apply the newest system technologies and innovations in natural refrigerants like CO2 and Ammonia. Our industry significantly impacts the planet, and PCE understands better than most how green and natural refrigeration can improve both the planet’s health AND a particular system’s ROI, safety and reliability.

PermaCold holds hard-earned experience as an award-winning engineering, installation, and service firm specializing in natural refrigerant systems, principally transcritical CO₂ (R-744) and ammonia (R-717). And we lean into that expertise, encapsulated in the PCE slogan “Our Planet, Our Responsibility” as a foundational operating principle behind what we do. As a leader in sustainability, PermaCold knows that principle is not just an environmental ethic; it’s the strategic playbook every industrial refrigeration operator in America should be following.

Why Refrigeration Matters in the Climate Conversation

Refrigeration is not a footnote in the climate discussion; it’s one of the main chapters. Industrial cooling is a significant consumer of power and other environment-impacting factors such as water use and sewage. 

Electricity production is a global driver of climate change. And in a typical refrigerated warehouse, the cooling system alone can consume 60–80% of total facility energy. Cold storage facilities are four to five times more energy-intensive than standard commercial buildings.

On top of that electrical load sits the refrigerant itself. It’s easy to see why the industry has shifted strongly and quickly to less toxic and natural refrigerants. A single kilogram of a common HFC released to atmosphere has a climate impact equivalent to roughly two metric tons of CO2. Contrast that with the natural refrigerants PermaCold designs around every day: CO2 has a Global Warming Potential of 1 and an Ozone Depletion Potential of 0; ammonia is zero on both.

The environmental math is clear, but so are the positives for the bottom line that the latest natural refrigeration system technology provides. Rather than generalize about those benefits, let’s take a quick look at a real-world example.

Proof in the Field

With an array of groundbreaking green refrigeration projects in our portfolio, PermaCold has a unique understanding that sustainability and high performance don’t have to be trade-offs.

In 2018, PermaCold engineered a 111,000-square-foot transcritical CO₂ freezer facility in Washington State. At the time it was commissioned, it was the first large-scale industrial freezer facility in North America built and operated solely on a transcritical CO₂ refrigeration system.

The system was engineered to use approximately 50% less energy than a comparable industry-standard ammonia system. And the system uses far less water, significantly cutting utility and sewer bills. Reliability has been high, maintenance costs low, and the facility's carbon footprint a fraction of inefficient old-school systems.

This innovative facility is one of our signature natural refrigerant projects, but not the only one. Across the Pacific Northwest and beyond (including projects by other Kelvin Group firms), our team designed, built, and maintains high-efficiency, natural refrigerant systems that are making a difference for our clients, their bottom lines, and the planet.

The Forces Driving Industry Trends Toward Natural Refrigerants

1. Federal Regulation Is No Longer a “Future” Concern

The American Innovation and Manufacturing (AIM) Act of 2020 was the most significant refrigerant regulation since the original CFC phaseout. It directs the EPA to phase down HFCs to 15% of baseline (an 85% reduction) by 2036. As of January 1, 2025, EPA's Technology Transitions Rule began restricting high-GWP HFCs across industrial and commercial subsectors, with cold storage warehouses, industrial process refrigeration, and remote condensing units facing strict GWP limits. Layer on EPA's HFC Leak Management Rule which mandates leak detection on systems with 15+ pounds of charge that took effect January 1^st of this year, and it becomes obvious why businesses need to consider natural refrigeration now. Due to regulatory imperatives, it is literally the future reality for industrial refrigeration.

2. The Economics Have Flipped

For years the argument against natural refrigerants was cost. That argument no longer holds. Modern transcritical CO₂ systems with parallel compression, ejectors, heat reclaim, and sophisticated controls can deliver up to 30% higher energy efficiency than conventional synthetic systems, and the gap is widening. Research shows coefficient-of-performance improvements of 18–23% from technologies like internal heat exchangers and expansion work-recovery devices, now moving from the lab into commercial deployment. Low-charge ammonia has followed a similar path, improving safety, reducing insurance exposure, and lowering lifecycle cost.

3. The Market Is Already Moving, and Fast

The global natural refrigerants market is projected to grow roughly 8.3–8.6% through 2029. There are already more than 46,500 transcritical CO₂ booster systems operating globally. Operators who wait are not saving money; they are buying stranded assets that will face rising refrigerant costs, shrinking parts availability, and depressed resale value long before their mechanical lives are over

4. Reputation Is a Revenue Driver

Major distribution companies, food brands, pharma companies, and logistics businesses are building sustainability criteria directly into procurement SOP. A cold storage partner running transcritical CO₂ or low-charge ammonia is not just greener, they are more marketable, more defensible to boards and lenders, and better positioned for green financing, tax credits, and utility rebates. Sustainability has graduated from a talking point to a revenue preserving strategy and marketing imperative.

Green Refrigeration Expertise: A Vital Consideration

A natural refrigerant system is not a retrofit kit you drop in, it is an engineering discipline. Transcritical CO₂ runs at significantly higher working pressures than traditional systems, requiring purpose-built components, exacting welding and fabrication standards, and advanced controls to manage supercritical operation across varying ambient conditions. Ammonia demands rigorous safety engineering and PSM/RMP compliance. Both deliver outstanding performance when done right, and real risk when done wrong.

This is exactly why PermaCold and Kelvin Group service providers have worked so hard to earn and grow an outstanding industry reputation in natural refrigeration expertise. As our other PermaCold slogan so aptly sums up, we believe “refrigeration is an engineered product,” custom-designed to each facility. If a company is making a large, strategic investment in a new refrigeration system, it literally pays to trust established, proven service providers with expertise in natural refrigeration engineering, construction, controls, service, and compliance.

The Takeaway

While once viewed as an unproven technology that was “nice to have if you can afford it,” natural refrigeration systems are no longer the future of industrial refrigeration. They are the present. The operators who recognize that now and move on it will be positioned to thrive in this new industry environment. In the process, they’ll also be doing their parts to preserve the planet for future generations, while boosting their refrigeration system performance, lifespan, and the corporate bottom line.