From Cold to Gold: Tradewater’s Plan for Destroying Greenhouse Gases

Did you know that greenhouse gases, ten thousand times as potent as carbon, possess the potential to destroy our climate or save it? Tradewater, a B-Corporation founded in 2016, has created a business model for collecting and destroying non-CO₂ Greenhouse Gases (GHGs) such as halocarbons and methane in the US and around the world. 

This innovative work is crucial for many reasons. From an environmental perspective, non-CO₂ gases trap heat in the atmosphere significantly faster than carbon dioxide; thus, they have a much higher global warming potential (GWP). Non-CO₂ GHGs account for about half of global warming since 1970, and there is no pathway to prevent 1.5 degrees Celsius of warming without addressing non-CO₂ gases. Furthermore, once these gases are released into the atmosphere, they cannot be removed (Brown 2024). The only option is to prevent their release in the first place. Tradewater works within current systems of compliance and voluntary carbon markets to incentivize the destruction of potent GHGs in exchange for high-quality, permanent offsets. 

The goal of this article is to explain the environmental impact and economic potential of the offset industry regarding refrigerant gases. Additionally, the aim is to convince Wesleyan University, among other schools, to exchange old refrigerants for alternatives with low GWP and ensure end-of-life destruction. 

Halocarbons Background

Tradewater primarily works with methane and halocarbons. This article will focus on halocarbons: chemicals that combine carbon and one or more halogen atoms, such as chlorine, bromine, fluorine, or iodine. They exist as refrigerants, solvents, fire-fighting agents, and aerosol propellants.

Refrigerants are gases that act as a cooling agent by absorbing and displacing heat, commonly used in air conditioning units, chillers, and refrigerators. Initially, toxic and flammable gases like ammonia, sulfur dioxide, and methyl chloride were used as refrigerants, but they resulted in many fatal accidents (Elkins 1999). In the mid-20th century, a variety of chlorofluorocarbons (CFCs) were popularized due to their colorless, odorless, nonflammable, and noncorrosive nature. However, CFCs are extremely potent GHGs and Ozone Depleting Substances (ODS). Compared to carbon dioxide, CFC emissions can trap up to 10,900 times as much heat in our atmosphere (California Air Resource Board 2024). 

In 1987, the Montreal Protocol effectively banned the production of virgin CFC material; however, the over 20 billion tons of CO₂ equivalent of CFC material that already existed continues to be reclaimed and circulated around the world today. Popular alternatives such as hydrofluorocarbons (HFCs) and hydrochlorofluorocarbons (HCFCs), which are also in the process of being phased out, have lower ozone depletion and GWP, but still much more than carbon dioxide. Better yet, some alternative refrigerants like isobutane have zero potential to deplete the ozone and practically no global warming potential (California Air Resource Board 2024).  

With the availability of reliable and environmentally friendly refrigerants, the repurposing of older, more harmful gases is negligent. The issue with this persistent use of CFCs, HFCs, and HCFCs is that no chilling system is 100% leakproof, meaning these potent GHGs continue to be released into the atmosphere. Additionally, storing and ridding of refrigerant gases is challenging to accomplish. They are most commonly found in cylinders and cans in garages, auto shops, HVAC stores, and in stockpiles owned by governments and businesses (Tradewater, 2021). The gas extracted from cooling systems is stored in metal tanks of various sizes that ultimately rust and leak gas.

Methodology of Destruction 

Tradewater has designed a process to prevent the release of refrigerants. Rather than leaving these tanks in storage, Tradewater sources them from individuals through small-scale aggregation programs and organizations through relationships-based pipelines. The material is then collected and sorted in a warehouse outside of Chicago. Once enough stock of a particular type of refrigerant is accumulated, the gas is shipped in a cylindrical truck to a destruction facility. There, the ozone-depleting potential of CFCs, HFCs, and HCFCs is rendered 99.99% inert through a process of incineration (Tradewater, 2023). Essentially, as the gas burns inside highly regulated and permitted equipment, the chemical compound separates, the chlorine is scrubbed out, and the carbon and hydrogen are released into the air. There is a small amount of carbon emissions as a byproduct of the destruction, but there is a net gain in preventing the release of extremely potent GHGs. This prevention of emissions can be considered a “carbon offset,” even though the material was not carbon dioxide, because it represents a reduction of GHG emissions above and beyond any regulatory requirements and can be calculated in terms of carbon dioxide equivalent (CO₂e).

Verification of High-Quality Offset Credits 

In order to issue carbon offset credits, an independent third party must verify that the project developers adhered to a strict protocol. Through the destruction process, continuous monitoring equipment ensures that international, federal, and local environmental regulations are met. There are different methodologies for each type of halocarbon, but all Tradewater projects follow offset protocols by the American Carbon Registry and California Air Resources Board for domestic ODS projects and Verra for international ODS projects (American Carbon Registry 2017). The guidelines generally conclude that “‘credits are of higher quality if the underlying project activities are truly “additional,” if the emissions avoided are “permanent,” and if the calculation of environmental benefit is “accurate” and transparent’”(Tradewater 2023). 

The first stipulation requires developers to prove that no other parties would have destroyed the refrigerants in the absence of their project. Despite banning production of ODS, the Montreal Protocol did not require an end-of-life solution for existing ODS. It is still permissible to buy, sell, and use ODS that was produced before the ban (EPA 2018). Since there is no mandate to collect and destroy ODS gases without the sale of carbon offset credits, the destruction of ODS would not take place, and the gases would escape into the atmosphere. 

The second stipulation has to do with the long-term impact, and clearly, permanent destruction is the best-case scenario. Other projects, such as forestry or soil preservation, calculate the offsets based on the amount of carbon sequestered over future decades. Still, human actions and natural processes can reverse the effects of the carbon capture. Through the destruction process described above, Tradewater’s projects ensure that over 99.99% of the chemicals are permanently destroyed (Tradewater 2023).

Lastly, the final stipulation must accurately reflect a reduction in net CO₂ emissions. When the carbon emissions produced during the project are not subtracted from the total reduction, baselines are incorrect, or uncertainties and complexities are inherent to the project, carbon offsets can be overestimated. Tradewater avoids these issues by having a third party weigh, sample, and analyze every container of ODS. Additionally, the offsets issued are reduced by an amount that corresponds with the collection, transport, and destruction of emissions.

Market Development 

The offset industry exists in voluntary and compliance markets. In the US, California and Washington have led the country in establishing compliance markets that function as a cap and trade program. This means the states put a cap that gradually decreases on GHG emissions for certain industries. Companies choose to operate more efficiently, burn less fossil fuels, or buy allowances from another company. Compliance markets reliably sell credits at higher costs and faster rates. The approximate price of compliance credits is in the mid $30s for California today. Voluntary credits, on the other hand, are typically sold at a lower price and are not limited by location or customer because there is no centralized market. Anyone can participate in the voluntary carbon market. In 2024, Tradwater’s voluntary credits sell for $19 per ton of CO2e (Tradewater 2024). The existing markets incentivize the destruction of potent greenhouse gases. 

Higher Ed Partnership

Universities and colleges have large volumes of refrigerants under their control. The older the equipment, the more it leaks, releasing potent greenhouse gases that can never be recovered from the atmosphere. ​Organizations can take action to prevent such damage by ensuring that their old refrigerants are responsibly destroyed at the end of life. In collaboration with Tradewater, colleges create an inventory of refrigerants across campus, develop a plan for destruction, and choose to receive cash for the material and/or carbon offset credits in return. The last part refers to the Pass Back Program in which the offsets produced by certain types of refrigerants are passed back to the school where they were found. Tradewater offers to buy CFCs and Halons or sell back the credits from the destruction of HCFCs and HFCs. The technical differences between the various gases result in distinct options for sale or purchase. In either case, the school makes a positive environmental impact and can benefit economically as well.

This process typically takes anywhere between three to nine months and depends on the timing and willingness of schools to convert to newer refrigeration systems. The comprehensive inventory is helpful for schools to know their potential GHG emissions and, once destroyed, their total climate benefit of avoided emissions. Through the Pass Back Program, these offsets can be applied toward the school’s sustainability commitments or other environmental, social, and governance (ESG) reporting mechanisms. Given the service costs are minimal and Tradewater’s lifetime partnership guarantees responsible management of old refrigerants for money and/or offset credits, there is no reason why organizations like Wesleyan University should still be utilizing and reclaiming refrigerants with high global warming potentials. This work is a critical part of the fight against climate change, and institutions of higher education should be prominent leaders in environmental efforts. It is time to switch to low GWP alternatives and ensure end-of-life destruction for extremely potent refrigerants. 

Terms

ARB: Air Resource Board

B Corp: A for-profit business that has been verified by B Lab to meet high standards of social and environmental performance, transparency, and accountability.

CFC: Chlorofluorocarbons 

CO2e: Carbon Dioxide Equivalent 

ESG: Environmental, Social, and Governance 

GHG: Greenhouse Gas

GWP: Global Warming Potential

HCFC: Hydrochlorofluorocarbons

HFC: Hydrofluorocarbon

HVAC: Heating, Ventilation, and Air Conditioning

ODS:  Ozone Depleting Substances

References

American Carbon Registry. “ACR Methodologies.” 2017.  https://acrcarbon.org/methodologies/approved-methodologies/.

Blumberg, A and Gonzalez, S. “Sell Me Your Climate Bombs.” Planet Money, NPR.  September 25, 2020. https://www.npr.org/2020/09/25/917060248/sell-me-your-climate-bombs.

Brown, Tim. “Why This Work Matters Now” https://tradewater.us/blog/why-this-work-matters-now/.

California Air Resource Board. “High-GWP Refrigerants.” https://ww2.arb.ca.gov/resources/documents/high-gwp-refrigerants.

EPA. “Section 608 of the Clean Air Act: Stationary Refrigeration and Air Conditioning.” USEPA. 2018. https://www.epa.gov/sites/production/files/2018-09/documents/section_608_of_the_clean_air_act.pdf.

Project Drawdown. “Refrigerant Management.” March 2, 2024. https://drawdown.org/solutions/refrigerant-management. 

Tradewater. “Evaluating Carbon Offset Credits: Why Credits Generated through the Destruction of Harmful Refrigerant Gas are Among the Highest Quality Available,” June 8th, 2021 https://tradewater.us/wp-content/uploads/2023/03/Tradewater_Offset-Quality-White-Paper_2023-Update.pdf.

Tradewater. “Offset Now.” September 26, 2024. https://tradewater.us/offsetnow/. 

UNEP Technology and Economic Assessment Panel. “Volume 2: Decision XXIX/4 TEAP Task Force report on destruction technologies for controlled substances.” 2018 https://ozone.unep.org/sites/default/files/2019-04/TEAP-DecXXIX4-TF-Report-April2018.pdf.

US Department of State. “The Montreal Protocol on Substances That Deplete the Ozone Layer.” https://www.state.gov/key-topics-office-of-environmental-quality-and-transboundary-issues/the-montreal-protocol-on-substances-that-deplete-the-ozone-layer/#:~:text=The%20Montreal%20Protocol%2C%20finalized%20in,%2C%20fire%20extinguishers%2C%20and%20aerosols.

Verra. “Verified Carbon Standard.”  https://verra.org/programs/verified-carbon-standard/?gad_source=1&gclid=CjwKCAiAxKy5BhBbEiwAYiW---ZsujpC3So4XiiMElInfcM8rC9RsVVpLRc9sJ6lW1-xnLCbehrlVRoCY8EQAvD_BwE.