1. HFC Workshop India Tom Catania Vice President Government Relations
Whirlpool Corporation
February 2011

2. Why is Whirlpool still using HFCs in USA?
Cost of transition
Energy efficiency advantages of HFC 245fa trumps GWP impact
Cheapest and least consumer utility compromise for achieving high efficiency
HFCs can be used responsibly and recovered
HCs still are subject to VOC emissions rules
Even modest litigation risk in USA when using isobutane refrigerant in a no-frost refrigerator can not be taken lightly in the US litigation, class action environment
Most importantly, new chemicals/technologies on short term horizon that may have positive characteristics of HFCs without the negatives of HCs or HFCs
“RETOOLING FATIGUE”

3. Simple Message: TEWI (Total Environmental Warming Impact)
The “Use” Phase of a long lived residential refrigerator and the power plant emissions associated with that use has a more significant environmental impact than the manufacturing phase or end of life—especially if the refrigerants and blowing agents are responsibly managed and recovered. The ideal combination of refrigerants and blowing agents in residential refrigerators would have zero ODP, very low GWP, low toxicity, be safe AND BE ABLE TO DELIVER THE HIGHEST POSSIBLE LEVEL OF ENERGY EFFICIENCY AT THE LOWEST POSSIBLE COST OR COMPROMISE OF CONSUMER UTILITY HYDROCARBON FOAM INSULATION AND BLOWING AGENTS MAY NOT BE THE BEST/LAST ANSWER Refrigeration manufacturers have “retooling fatigue.” - CFCs-HCFCs-HFCs-HCs-HFOs-? - continuous retoolings steal capital from investment in new environmental breakthroughs in the important areas of energy efficiency and smart products on smart grids, for example

4. Foam HFC / HCFC / NEW TECHNOLOGY?
ODP
GWP
ENERGY EFFICIENCY
CFC
HFO
CFC
HFC
HCFC
HCFC
HFO
HCFC
CFC
HFC HC HC HC
HFC
HFO
GWP
Energy
Zero
High
Low
High
Worst
Best
Showing ideal case scenario
Highlighting HFC usage in relation to GWP impact
HFO highlight
Ideal Equation for longer run would be 0 ODP , Low GWP , High Energy Efficiency
Foaming agents used today have element’s of all 3 , but not all the best characteristics
Managing proper disposal & usage of VOC’s ( Hydrocarbons ) during service , transport etc
HFC’s have been used extensively , however have a high GWP impacting the environment
HFO’s to provide the best new solution moving forward for energy & environmental benefits
Ideal Opportunity

5. GDP / GROWTH / PENETRATION / POTENTIAL – India Case
Refrigerators are a ~6.2 mn units industry, growing aggressively YOY
Currently, only 14% of the market is penetrated, expected to grow to 25% by 2015
Most of the Indian market is Direct Cool (78%)
DC market is growing faster than the Frost Free market,
driving refrigerator penetration in India
Potential Equation
India’s Economic Prosperity
CAGR 11.5%
CAGR 8% +
Indian Consumer’s buying potential =
Higher sales of refrigerators ( e.g. DC ) products on the market
78% of the consumer in India purchases a DC product
with GDP growth , better purchasing power more products to be sold ( 11% growth expected in the next few yrs)
DC consumer is very price sensitive , and buys a ref for primarly cooling food items
Need to be sure we are providing the best foam & energy benefits to assist with the Indian govt’s initiatives under energy & environmental
Need to make the right selection of Blowing Agents and refrigerants with the broader & longer environmental picture in mind
Growth of low income purchasers and total volume requires solutions that don’t drive the wrong behavior

6. Providing value to the masses
Entry-level consumers for both Direct Cool and No Frost are extremely price-conscious, seeking ‘value for money’
Energy efficiency / Eco moved up from 8th to 4th place in importance in purchasing an appliance (behind brand, price & color)
HC’s significantly increase the GWP effect on the environment moving forward
Early tests not in optimized refrigerator and assumes full venting of HFCs
Direct Cool sales in INR
No Frost sales in INR
Most sales are lower price point
Cost , Cost , Capacity are the most important factors while purchasing products
Energy & environmental has picked up over the years but needs to be managed carefully to prevent any offset
BULK SALES ON ENTRY LEVEL PRICES POINTS
HFO
HFC - 245 HC
HFC - 134
Source : DuPont
Consumers Understand Energy Efficiency, not GWP… Continue To Seek ‘Value’

7. Risk of converting too early?
HIGH ODP
LOW GWP
ZERO ODP
ZERO ODP . LOW GWP , ENERGY EFFICIENCY
HFC
CFC
HCFC HC
HFO
3-4 years until mass production ( est / 15)
BLENDS
Ideal Opportunity
Manufacturer’s globally as well as in India to comply with global regulations for material usage ( HFC etc )
Every step requires a large investment from a manufacturer that affects product cost , design etc
Investments need to be recouped from sales resulting in possible price increases
Unique situation in India as compared to mid 1990’s CFC phase out
Energy Regulations are very stringent from 2012 – 2014 ( 60% jump )
Environmental regulations force manufacturers to comply for chemical phase out
SHOULD NOT FORCE THE USE OF A CHEMICAL RATHER SUPPORT THE DEVELOPMENT OF THE RIGHT CHOICE FOR THE ENVIRONMENT

8. Impact on the Indian energy grid
Analysis of the impact of energy standard changes on the overall energy consumption
Today
Note: Illustrative calculations only, qualitatively correct; Market penetration & growth have been factored in
Consumer behavior needs to change….if not the impact of regulations would be negated on the grid & environment !
Currently, on average, India’s average buying is ~3.7 energy efficiency level
If they move up by 20%, then overall energy consumption will come down (GREEN)
If average buying behavior does not change due to cost, overall energy consumption will increase (RED)
Need to Promote Energy Efficiency & Eco Conscious Lifestyle for the Indian Consumer

9. Conclusion – India should not rush into a sub-optimum solution that limits potential “use phase” emission reductions*
*Or has the unintended consequence of consumers trading down to less expensive, but less efficient models
Our Proposal for residential refrigerators: Modest delay (1-2 years) in HCFC phase out
India could lead rest of the world in development and export of next generation solution

10. Thank you !

11. HFC Consumption Globally & India View
Source : EPA (
79% of refrigeration / AC appliances consumed HFC’s in 2010 across the world
Over Billion refrigeration appliances in global operation last year alone
Each refrigerator possibly has 1.5 kg of refrigerant & foaming agents
HFC have a high GWP ranging from
6-7% CAGR of refrigeration appliances in India ( Source : Euromonitor )
85% of refrigerator sales were in the < 142 lt ( ~5 cu.ft ) category
India’s growth lies in its masses with people purchasing refrigerator’s as a basic need
Need to monitor & select right chemical for the environment as refrigerators last years

12. Synergy between Energy Efficiency & TEWI
KEY TAKEAWAY’S
ENERGY
EFFICIENCY
ATMOSPHERIC
EFFECTS
ENERGY EFFICIENCY
20% JUMP IN 2012
40% JUMP IN 2014
RESPONSIBLE USE OF MATERIALS
2013 phase out for HCFC
Overall goal by Montreal Protocol to reduce carbon emissions by 2030
-Overview of the situation in India over the next 2-4 years
- Energy Efficiency & Environmental effects are two pieces of a puzzle that complement each other to get the best benefits under each space
RIGHT BALANCE NEEDS TO BE ACHIEVED AND NOT MUTUALLY EXCLUSIVE
INDIA FACED WITH CHALLENGES OVER THE NEXT FEW YEARS TO LOWER OVERALL ENERGY INTENSITY
WHILE PHASING OUT HCFCS

13. TODAY’S LANDSCAPE BUT NEED TO LOOK FURTHER?
Energy Benefits :
Low
Medium
High
No ideal BA found that has 0ODP , low GWP , and high energy benefits
CFC
Use of HFC’s growing however still has a high GWP
Environmental Impact
HCFC
HFC HC
HFO
Swift changes in regulations leading to bandaid approach , that is not entirely benefiting the environment
Innovative challenges under this space , have shown that with some more testing & development one could have the ideal BA
Time
Aim to drive right investment’s for an ideal blowing agent !
INNOVATION UNDER THIS SPACE TO PROVIDE MOST IDEAL BLOWING AGENT SOLUTION FOR THE ENVIRONMENT

14. Unique Issues to the Indian Market
Supply Base Impact if moved to a foam that impacted energy & environment:
Use of High Efficiency components like VIP’s , VCC compressor’s to meet energy regulations
Diminishing return’s and high cost’s could potentially lead to higher product cost
Consumer’s forced to purchase lower energy efficient product
These step’s would negate entire purpose of reducing energy & environmental impact in the country
Lack of Incentives for higher energy rated & environmentally friendly products
Lack of incentives by the govt to drive higher sales of energy & environmentally friendly products
Manufacturers forced to comply to standards however unsure on consumer behavior
Funding opportunities present in multiple regions like Mexico ( e.g. UNIDO funding )
Infrastructure Concerns
Servicing of VOC’s
Incremental increase in material costs & import duties
- Issues that persist today & perceived in the future
Other?

15. Opportunities for India
Infrastructure
Government & Manufacturers partnership in developing low cost components for the “World”
Foam ‘s , refrigerant’s , etc
Providing incentives for manufacturers to assist in the Indian government’s goal to help reduce energy efficiency & carbon emissions part of the 11th five year plan
Incentivize use of high cost components like VIP’s VCC’s etc
Create an EPR framework for safe disposal of components
Create awareness amongst Indian consumer for the need of supporting global cause
Look for opportunities beyond regulatory landscape that would help make “India a leader in this space”
Partner with key leader’s in technology development in new areas like Smart Grid
Consumer Awareness
Creating an awareness for the need & value to purchase energy & environmentally friendly products
Promote the use of product’s with special consideration’s from govt & manufacturers
Tax credit’s / rebates for energy & eco friendly product’s