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issue: January 2008 APPLIANCE Magazine

Air-Conditioning and Refrigeration Institute Editorial
2008: The Industry Comes Together

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by Stephen R. Yurek, president, Air-Conditioning and Refrigeration Institute (ARI)

2007 saw our industry weathering the effects of the U.S. 13 SEER federal minimum standard while facing a sharp decline in housing starts, a depressed housing resale market, and increased regulatory scrutiny both here and abroad. 2008 promises more of the same, but there are reasons for optimism.

Stephen R. Yurek

One of those reasons is that in 2007 the industry finally decided to come together as one—heating, cooling, and refrigeration all under one association umbrella. January 1, 2008, will herald the dawn of a new era of industry collaboration on three pillars: standards, certification, and advocacy. The merger of ARI and the Gas Appliance Manufacturers Association (GAMA) into the Air-Conditioning, Heating, and Refrigeration Institute (AHRI) creates a 370-member association with combined annual sales topping $27 billion. Instantly in the top 15% of trade associations in America, AHRI will wield the clout commensurate with the size, workforce, and sales volumes of its member companies.

We see opportunities for industry growth in areas where “developing” is fast becoming “developed,” such as parts of the Middle East and countries like Brazil, China, India, Korea, and Mexico.

Although overall shipments of residential air-conditioners and heat pumps were again down about 10% from the previous year, shipments of higher-efficiency equipment (that rated above 13 SEER) were higher in 2007. That means that consumers, concerned about high energy costs, are turning to our products as part of the solution. That information, combined with the fact that contractors printed 30% more certificates of ARI Certified Performance in 2007, suggests that our message of highly efficient, ARI-certified equipment is reaching consumers, both directly and through installers.

Ultimately, the challenge here is to find ways to accelerate replacement of the installed base of less-efficient central air-conditioners and commercial refrigeration equipment. Manufact­uring better, more-efficient equipment is good, and is what places our industry at the cutting edge of environmental technology. But the really important thing is getting that efficient equipment in homes and businesses, i.e., replacing the installed base. The installed base will naturally replace itself in about 20 years or so, but the high price of—and demand for—energy, coupled with increasing environmental pressures, make that replacement a more urgent matter.

While we support a national program, some states, like California, are considering pilot programs to require replacement of a five-plus-year-old, 13 SEER system when a house is sold, with the cost rolled into the buyer’s mortgage. It is abundantly clear that if saving serious energy is the goal, a piecemeal approach is not sufficient. And with evidence suggesting that more homeowners are opting to repair their old, inefficient systems rather than purchase new, high-efficiency units, the need becomes even more urgent.

Regulatory challenges abound, both here and abroad. Legislation and regulatory initiatives to address climate change both here and overseas will continue in 2008, as AHRI and our industry allies work to ensure protection of the refrigerants vital to the efficient operation of many of our products. Our initiatives to minimize emissions of those refrigerants into the environment will continue, as will our efforts to persuade the U.S. Environmental Protection Agency to regulate HFCs under the Clean Air Act and Congress to approve a plan to use levies on production of virgin refrigerants to fund reclamation, recycling, and/or destruction of used refrigerants.

Overseas, ARI will continue to work through the Brussels-based European Partnership for Energy and the Environment (EPEE) to ensure refrigerant choice and sound policies to address climate change and energy efficiency. AHRI and EPEE will continue to advocate for a successful program of industry self-regulation.

In 2007, we worked with counterpart associations in Europe, China, Mexico, and Brazil to establish a framework for cooperation on harmonization of standards and certification programs. That effort will continue—and expand—in 2008. It is essential to creat and maintain a level playing field in standards and certification in order to ensure free and fair access to all markets for our manufacturers.

Education issues continue on our agenda and will be a priority again this coming year. 2008 looks to be a year of significant activity on this front, as AHRI joins with the Association for Career and Technical Education to advocate for federal programs such as the Perkins Act and revision of the No Child Left Behind Act. In addition, the HVACR Instructor Workshop, now in its 14th year (and now also encompassing plumbing) will again be held in Lansdowne, VA, U.S., in March.

Separately, ARI and GAMA have successfully advocated for our respective parts of the industry at home and abroad. In 2008, as AHRI, we will stand as a powerful, united voice for the industry as we face shared challenges and embrace collective opportunities. 


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