Uniteo States
Environmental Protection
Agency
Office of Pesticides and
Toxic Substances
Washington, DC 20460
EPA-560/12-80-001b
October 1980
Toxic Substances
Regulating Chlorofluoro
carbon Emissions: Effects
On Chemical Production
Support Document for
Economic Implications of
Regulating Chlorofluorocarbon
Emissions from Nonaerosol
Applications
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EPA-560/12-80-OOlb
October 1980
REGULATING CHLOROFLUOROCARBON EMISSIONS:
EFFECTS ON CHEMICAL PRODUCTION
Contract No. 68-01-3882
& 68-01-6111
Project Officer:
Ellen Warhit
REGULATORY IMPACTS BRANCH
ECONOMICS & TECHNOLOGY DIVISION
OFFICE OF TOXIC SUBSTANCES
WASHINGTON, D.C. 20460
U.S. ENVIRONMENTAL PROTECTION AGENCY
OFFICE OF PESTICIDES AND TOXIC SUBSTANCES
WASHINGTON, D.C. 20460
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Disclaimer
This document is a support document for a contractor's study
done with the supervision and review of the Office of Pesticides
and Toxic Substances of the U.S. Environmental Protection
Agency. The purpose of the main study was to evaluate the
economic implications of alternative policy approaches for
controlling emissions of chlorofluorocarbons (CFCs) in the United
States.
The support document was submitted in fulfillment of
Contracts No. 68-01-3882 and 68-01-6111 by the contractor, The
Rand Corporation/ and by its subcontractor, International
Research and Technology, Inc. Work was completed in August 1980.
The study is not an official EPA publication. The document
can not be cited, referenced, or represented in any court
proceedings as a statement of EPA's view regarding the
chlorofluorocarbon industries, or of the impact of the
regulations implementing the Toxic Substances Control Act.
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-iii-
PREFACE
Scientific studies indicate that atmospheric emissions of chloro-
fluorocarbons (CFCs) contribute to depletion of the ozone layer that
protects the earth from harmful ultraviolet radiation. Since 1978,
almost all use of CFCs to propel aerosol products has been banned.
As part of a study to examine the economic impact of regulating CFC
emissions in nonaerosol applications, this Note assesses the im-
plications of potential regulations for the CFC and precursor chemical
producing industries.
The research was performed under contracts P.C. 68-01-3882 and
68-01-6111 for the U.S. Environmental Protection Agency. It is part
of a larger program sponsored by EPA in conjunction with the Consumer
Product Safety Commission and the Food and Drug Administration. Other
studies are concerned with evaluating the biological and economic im-
plications of ozone depletion. The present study specifically considers
the industries that use and produce CFCs. This Note focuses par-
ticular attention on the manufacture of the CFCs themselves and their
precursor chemicals. It should be of interest to readers in govern-
ment and industry with a basic understanding of chemical production.
Three other Rand reports documenting results of this study are
being produced. The first presents the detailed results of the study:
Adele R. Palmer et al., Economic Implications of Regulating Chloro-
fluorocarbon Emissions from Nonaerosol Applications, R-2524^EPA.
The second is based on a briefing to EPA summarizing the study results:
Adele R. Palmer et al., Economic Implications of Regulating Nonaerosol
Chlorofluorocarbon Emissions: An Executive Briefing (R-2575-EPA).
The third provides greater detail on the analysis of flexible foam
applications: William E. Mooz, Flexible Urethane Foams and Chloro-
fluorocarbon Emissions (N-71472-EPA).
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-V-
SUMMARY
Recent studies have indicated that chlorofluorocarbons (CFCs)
reach the stratosphere intact and contribute to depletion of the
ozone layer. Most uses of CFCs as aerosol propellants were banned
in the United States in 1978. This work is part of a study to exam-
ine the economic effects of regulations on nonaerosol CFG emissions.
Specifically, it addresses the implications of limiting emissions on
the CFG and precursor chemical production industries.
One purpose of this work is to update and extend the data base
on CFG and precursor chemical production. This document presents
estimates of the CFG production, sales, and aerosol and nonaerosol
use for 1970 through 1977. A method based on the chemical equations
for CFG production is used to estimate precursor chemical requirements
for the same historical period. Recent production capacity data for
the producers of CFCs and the precursor chemicals are also presented.
The second purpose of the work is to provide the framework for
examining the implications of future CFC emissions reductions on the
producing industries. Based on 1990 projections of CFC production,
the techniques developed here are used to estimate 1990 CFC use and
precursor chemical production requirements in the absence of policy
action. Finally, to illustrate the applicability of the methods,
two general policy strategies for limiting CFC emissions are con-
sidered. The effects on CFC and precursor chemical production of
five policy designs within the two general policy strategies were
examined. These five policy designs lead to cumulative (1980-1990)
CFC emissions reductions of between about 15 and 30 percent.
The findings indicate that the aerosol ban has had a severe impact
on production of CFCs used as propellants. Production of these CFCs
(CFC-11, CFC-12, and CFC-114) is not expected to reach 1976 levels
again until approximately 1990. The most stringent policy de-
sign considered for limiting nonaerosol emissions would lead to a 17
percent decline over the projected base case production of carbon
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-vi-
tetrachloride, one of the precursor chemicals. For the other pre-
cursor chemicals analyzed, the reduction would not exceed 7 percent.
This document contains information of general use for assessing
the effects on production of any proposed level of CFG emissions re-
duction. A knowledge of the value of any one of three variables,
CFC use, CFC production, or precursor chemical production, allows the
estimation of the values for the other two variables.
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ACKNOWLEDGMENTS
We are indebted to a large number of people who contributed
heavily of their time, knowledge, and ideas during this study. We
are particularly grateful to those in industry who reviewed the ini-
tial data and clarified many concepts.
We deeply appreciate the efforts of Gary Mills in his thorough
review of the draft. Finally, we wish to thank Anne Boren for typing
this document.
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-IX-
CONTENTS
PREFACE ..,..,,.,..,,,,.,,., ,
SUMMARY v
ACKNOWLEDGMENTS vii
TABLES xi
Section
I. INTRODUCTION 1
II. CFC PRODUCTION PROCESSES 5
CFC-ll/CFC-12 6
CFC-22 8
CFC-113/CFC-114 9
Precursor Chemicals 10
III. HISTORICAL PRODUCTION OF CFCs AND PRECURSOR CHEMICALS 11
CFC-ll/CFC-12 11
CFC-22 13
CFC-113/CFC-114 15
Precursor Chemicals 15
IV. HISTORICAL CFC END USE 18
Non-Use Emissions 18
Intermediate In-House Use 20
Inventories , 20
Exports , 21
Aerosol Use 21
Nonaerosol Use . , , 22
V. CFC AND PRECURSOR CHEMICAL PRODUCERS 26
CFC Producers , .., 26
Precursor Chemical Producers , 33
VI. FUTURE PRODUCTION AND THE EFFECTS OF POLICY ACTION >f 35
1990 CFC End Use 35
CFC Production and Sales ^ _ 35
Precursor Chemical Production ^ 39
Future Policy Action 41
VII. CONCLUSIONS 47
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-X-
Appendix
A. PRECURSOR CHEMICALS FOR CFC PRODUCTION . , , 49
B. HISTORICAL PRECURSOR CHEMICAL PRODUCTION , 60
C. HISTORICAL CFC APPORTIONMENT 72
D. CALCULATING CFC NONAEROSOL END USE . , , . . , 81
E. ALLOCATION OF CAPACITY ,. 85
F. CFC SALES ESTIMATES , 89
G. PRECURSOR CHEMICAL PRODUCERS 93
REFERENCES , , 103
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-XI-
TABLES
II-l. Precursor Chemicals for CFG Production 10
III-l. CFC-ll/CFC-12 Production and Sales—1970-1977 12
III-2. CFC-22 Production and Sales—1970-1977 13
III-3. CFC-113/CFC-114 Production and Sales—1970-1977 14
III-4. Precursor and Byproduct Chemicals for CFC Manufacture—1970-1977.. 16
III-5. Percentage of Precursor Chemical Production Devoted to
CFC Manufacture—1970-1977 17
IV-1. CFC Apportionment—1976 23
IV-2. Estimated CFC Nonaerosol End Use—1976 24
V-l. CFC Capacity by U. S. Producers 27
V-2. 1977 Capacity Apportionment 29
V-3. CFC Sales and Sales Value 30
V-4. CFC Historical Prices—1970-1977 31
V-5. 1977 CFC Sales 32
V-6. 1977 CFC and Total Sales 33
V-7. Precursor Chemical Production for CFCs 34
VI-1. Estimated Nonaerosol CFC End Use—1990 36
VI-2. Estimated Nonaerosol CFC Production and End Use—1990 37
VI-3. Estimated Precursor Chemical and Byproduct Production—1990 40
VI-4. Reduction in CFC Use Under Benchmark Controls and Four
Economic Incentive Policy Designs—1990 42
VI-5. Reduction in Precursor Chemical Requirements—1990 43
VI-6. Percent Reduction in Precursor Chemical Requirements—1990 45
A-l. Molecular Formulas and Weights 49
A-2. Chemical Equations for CFC Manufacture 50
A-3. Intermediate Precursor Chemical Factors 58
A-4. Preliminary Precursor Chemical Factors 58
A-5. Byproduct HC1 Factors 59
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-xii-
B-l. CC1, Production for CFCs--1970-1977 60
B-2. HF Production for CFCs—1970-1977 61
B-3. CHC13 Production for CFCs—1970-1977 62
B-4. C Cl, Production for CFCs—1970-1977 63
B-5. C12 Production for CFCs—1970-1977 64
B-6. CS Production for CCl^—1970-1977 66
B-7. Cl production for CHC1—1970-1977 67
B-8. Cl Production for CC1, —1970-1977 68
B-9. C12 Production for C2C14—1970-1977 69
B-10. HC1 Production from CFCs—1970-1977 70
B-ll. HC1 Production from Precursor Chemicals—1970-1977 71
C-l. CFC-11 Apportionment—1970-1977 73
C-2. CFC-12 Apportionment—1970-1977 74
C-3. CFC-22 Apportionment—1970-1977 75
C-4. CFC-113 Apportionment—1970-1977 76
C-5. CFC-114 Apportionment—1970-1977 77
C-6. CFC Aerosol and Nonaerosol End Use—1970-1977 80
E-l. CFC Production and Capacity—1970-1977 86
E-2. 1977 CFC Capacity 88
F-l. 1977 CFC Sales from Production Figures 89
F-2. 1978 Price List—CFC-11 91
G-l. CCl^ Plant Capacity—1977 94
G-2. HF Plant Capacity—1977 96
G-3. CHC13 and C Cl, Plant Capacity—1977 99
G-4. CS2 Plant Capacity—1977 100
G-5. C12 Plant Capacity—1975 102
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-1-
I. INTRODUCTION
In recent years, scientists have hypothesized that chlorofluoro-
carbons (CFCs) reach the stratosphere intact, and once there, con-
tribute to depletion of the ozone layer. Although the problem is
global, the United States has been the largest single user of CFCs.
The Environmental Protection Agency (EPA) and the Food and Drug
Administration (FDA) banned the use of CFCs as propellants in aero-
sol products in December 1978. In mid-1977, the EPA, together with
the FDA and the Consumer Product Safety Commission, asked Rand to
study the economic implications of regulatory strategies for limiting
nonaerosol CFC emissions.
This document is part of a study of the economic effects of
regulating CFC emissions. Its purpose is twofold. First, it up-
dates and extends the data base on CFC and precursor chemical pro-
duction, the production processes, and the producers. Second, it
examines the implications of a mandatory control and economic incen-
tives policy strategies for limiting emissions on future CFC and
precursor chemical production. To accomplish the second objective,
we developed techniques for relating precursor chemical production to
CFC production, and CFC production to CFC use and emissions. Thus this
document provides the framework for assessing the consequences of any
future level of CFC emissions on the CFC and precursor chemical pro-
ducing industries.
CFC uses are diverse and pervasive. It is a blowing agent for
flexible foam used in bedding and carpet underlay, a blowing agent
for foam used in food packaging applications, and an insulating medium
in foam used to insulate buildings and refrigeration devices. CFC
acts as a refrigerant in automotive air-conditioning units, home
refrigerators and freezers, retail food refrigeration systems and
commercial air-conditioning units, and as a solvent for metal clean-
ing and the defluxing of printed circuit boards. CFCs are used in a
variety of other ways, including the liquid fast freezing.of foods
and the sterilization of hospital goods.
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The CFC used in these numerous applications is manufactured by
five chemical firms. The chemicals used as precursors to CFC manu-
facture are produced by many chemical firms. All producers of these
chemicals would be affected by regulatory policies that limit non-
aerosol CFC emissions. Limiting emissions reduces use which in turn
reduces production of the CFCs and the precursor chemicals used in
their manufacture.
Although approximately a dozen CFCs are manufactured presently
in the United States, only three, CFC-11, CFC-12, and CFC-113, are
of primary concern, both because they are fully halogenated, and
because they are widely used. CFC-22, which is also widely used, is
not as hazardous to the ozone layer as those CFCs listed above. Anal-
ysis of CFC-22 is included here because it is a potential substitute
for the more hazardous CFCs in refrigeration applications. Another
chlorofluorocarbon, CFC-114, also fully halogenated, is used in
relatively small quantities in a limited number of applications.
CFC-502 and CFC-500, which are combinations of other CFCs in various
proportions, are, like CFC-114, not widely used.
This study provides estimates of production of the CFCs and the
most important precursor chemicals as well as estimates of total CFC
use from 1970 to 1977. Projections of annual production of the CFCs
and precursor chemicals extend through 1990. These projections form
a base case production profile in the absence of regulation. The
implications on CFC and precursor chemical production of limiting CFC
emissions and use under two general policy strategies which include
five policy designs are evaluated. These five policy designs result
in rather modest reductions in CFC emissions, between about 15 and
30 percent for the period 1980-1990.
One important finding of this study is that the ban on CFCs for
use as propellants has been very significant in decreasing CFC pro-
duction requirements. For those CFCs that were heavily used in
aerosols (CFC-11, CFC-12, and CFC-114), production will not again
reach 1976 levels until the end of the decade. Alternatively, pro-
duction of CFC-113 and CFC-22, neither of which was used as a pro-
pellant, has continued to increase.
A CFC that is fully halogenated contains no hydrogen.
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-3-
Limiting CFC emissions to the extent considered here will have a
much smaller effect on CFC and precursor chemical production than has
the aerosol ban. The precursor chemical that would be most affected
by these regulatory policies is carbon tetrachloride, used to manu-
facture CFC-11 and CFC-12. Even in this case, however, total pro-
duction would decline, at most, by 17 percent over projected base
case levels. The other precursor chemicals, since a smaller portion
of their production is devoted to CFC manufacture, would decrease by
less than 6 percent from the base case projections.
Section II of this document presents the chemical equations for
the production of the CFCs. The precursor chemicals that are most
dependent on continuing CFC production are identified.
Historical production of the CFCs from 1970 to 1977 is given in
Section III. These data, together with the chemical equations in
Section II, are used to develop estimates of the historical precursor
chemical production requirements for CFC manufacture. The techniques
for relating a particular level of CFC production to a particular
level of precursor chemical production are useful in a more general
sense. Production of a precursor chemical can be determined by mul-
tiplying production of any CFC for any year by the appropriate "factor"
(given in Appendix A) for the individual precursor chemical.
In Section IV, we discuss the destinations of the various CFCs
from the time they are produced until the time they are used. A
model for estimating CFC end use from CFC production is developed
using the historical production figures of Section III.
In Section V, the producers of the CFCs and precursor chemi-
cals are identified. We also assess the dependence of each pro-
ducer on CFC manufacture for the historical period based on plant
capacity and information obtained from industry sources.
Base case projections of 1990 CFC production, derived from
industry-supplied data, are given in Section VI. The techniques
developed in Section IV are used to estimate 1990 CFC use. These
use data are then compared with 1990 projections of CFC use developed
in this study for most major and some minor CFC applications. The
CFC production data are also used, together with the methods of
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Section III, to derive base case estimates of 1990 precursor chemical
production. Reductions in CFG use resulting from five policy designs
for reducing 1990 CFC emissions are presented. Using the techniques
developed in Sections III and IV, these reductions in use are trans-
lated into reductions in 1990 CFC and precursor chemical production.
In Section VII, we present the general conclusions of this study.
In addition, we stress the wider applicability of the methods developed
here. If a future value for any of the three variables (CFC use, CFC
production, or precursor chemical production) is available, values for
each of the other two variables can be estimated. The data and methods
of this document serve as a framework for assessing the effects of po-
tential future CFC emissions limitations on the producing industries.
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II. CFC PRODUCTION PROCESSES
The chemicals considered in this study are CFC-11, CFC-12,
CFC-113, CFC-114, and CFC-22. Because they contain both chlorine
and fluorine, they are referred to as chlorofluorocarbons (CFC).
They are highly unreactive and may not decompose prior to entering
the stratosphere. CFC-22, which contains a hydrogen atom, is hypo-
thesized to be more susceptible to decomposition. Even so, it is
important to consider CFC-22, both because it may reach the strato-
sphere intact, and because it is often mentioned as a potential
substitute for the fully halogenated CFCs in some applications.
Five U.S. companies currently manufacture CFCs: E. I. DuPont
de Nemours (DuPont), Allied Chemical Corporation (Allied), Kaiser
Aluminum and Chemical Corporation (Kaiser), Pennwalt Corporation
(Pennwalt), and Racon, Inc. (Racon), now part of Essex Chemical Company.
Another company, Union Carbide Corporation, recently discontinued pro-
duction of CFCs. All five producers manufacture CFC-11, CFC-12, and
CFC-22, while only DuPont and Allied produce CFC-113 and CFC-114.
As far as can be determined, similar production processes are
2
used by all the manufacturers. The pairs CFC-ll/CFC-12 and CFC-113/
CFC-114 are coproduced; plants designed for the production of one
3
pair cannot readily be converted to production of the other pair.
This section describes the chemical processes for CFC manufacture.
Some chemicals are highly dependent on CFC manufacture, either because
a large percentage of the total production is used for CFC manufacture,
or because they could not readily find use in other applications.
These precursor chemicals are identified as each CFC production pro-
cess is considered.
Union Carbide has sold its production equipment to IPI of Wichita,
Kansas, which may produce CFC-11, CFC-12, and CFC-22 in the future.
2
Although the same chemical equations apply for CFC manufacture,
the process conditions may vary from producer to producer.
Section V gives a brief discussion of plant conversion.
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CFC-ll/CFC-12
Two processes, commonly called the liquid phase process and the
vapor phase process, may be used to coproduce CFC-11 and CFC-12. Both
processes use the same chemical inputs, carbon tetrachloride (CC1,)
and anhydrous hydrogen fluoride (HF), and both yield CFC-11 and CFC-12
as well as byproduct hydrochloric acid (HC1). The main differences
between the two manufacturing methods are that the vapor phase process
uses higher temperatures in general, and is subject to over-fluorination
yielding CFC-13. According to knowledgeable industry sources, the HC1
produced as a byproduct in both processes is an extremely important
factor in the economics of production. Markets for the HC1 are dynamic,
and both the quality of the byproduct HC1 and CFC plant location can
influence the salability of this chemical.
Another important economic consideration to the producer is the
precursor chemical requirement for CFC production. Industry sources
estimate yields from the liquid and vapor phase processes as 98 and
97 percent respectively, which implies that the material costs for the
two processes are almost the same. Reference 1 asserts that material
costs represent more than 70 percent of the production cost in a CFC
plant operating at full capacity.
CFC-11 and CFC-12 are produced according to the following chemi-
cal equations:
CC14 + HF -> HC1 + CC1 F (II-l)
(CFC-11)
CC14 + 2HF •> 2HC1 + CC12F2 (II-2)
(CFC-12)
Nearly all of the CC14 and almost half of the HF2 produced domes-
tically are used in CFC manufacture. According to Reference 1 and
Industry individuals contend that there is very little market
for this CFC.
2
A large amount of HF is also used in the aluminum industry.
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industry sources, CC1, can be produced in three ways: using pro-
pylene (CLH,) and chlorine (Cl ) with coproduction of perchloro-
.3 D i <—
ethylene (C Cl,); using carbon disulfide (CS9) and chlorine; or
24 2
using methane (CH.) with chlorine. The three production processes
3
can be described as follows:
(7a-2b) C1 + (a-2b) CCl + (a+b) CC1 + 6aHCl
CS2 + 2C12 -> CC14 + 2S
4C12 + CC14 + 4HC1
C Hg, CH4, many of the chlorocarbons, and CH-OH are common raw
materials in high demand, and therefore they could probably find use
elsewhere if CFC production were in some way limited. The precursor
to CC14 production that could be affected by a change in CC1, demand
is CS2> Cl- would also be affected, but to a lesser extent.
Chemicals other than propylene, including hydrocarbons and
chlorocarbons, can be used to produce CC14. Industry sources indi-
cate that chlorocarbon byproducts obtained from other processes such
as vinyl chloride and propylene oxide production are frequently used
as feed.
2
Some CC1, is obtained using methanol (CH-OH) or methylchloride
(CH-C1) in the coproduction of methylene chloride (CH2C1 ) and chloro-
form (CHCl^). For simplification, since the starting material can be
traced to CH,, the process will be considered as described above.
In Equation II-3, the small letters, a and b, are meant to
indicate that the process can be varied to produce a different mix
of CC14 and C Cl depending on the proportions of the input chemicals
and reactor conditions. As will be seen later, C_C14 is used in the
production of CFC-113/CFC-114. This method of producing C2C14 and
CC14 is one of many examples which illustrate the interrelationships
in the chemicals industry. If production of a given chemical were
discontinued, all other downstream chemicals and possibly some up-
stream chemicals would also be affected.
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The other input to CFC-ll/CFC-12 manufacture, HF, is produced
using fluorspar (CaF^) and sulfuric acid (H-SO^) in the following way:
CaF + H2SO, -»• 2HF + CaSO^ (II-6)
Only a very small percentage of total H SO, goes toward CFC
manufacture. Although about one-third of the fluorspar consumed in
the United States is so employed, much of it is imported. Neither
H-SO, or CaF- will be considered further here, H-SO, because of its
minor use in CFC manufacture, and CaF« because much of it is mined
outside the United States. Both precursors, however, would be
affected by a change in CFC production.
CFC-22
This CFC is produced using chloroform (CHC1_) and HF in the fol-
i • 2
lowing manner:
CHC1 + 2HF -> 2HC1 + CHC1F2 (II-7)
(CFC-22)
In this case, as with CFC-ll/CFC-12, the marketability of the byproduct
HC1 can have a significant effect on the manufacturing economics.
Equation II-7 illustrates that CFC-22 production requires HF, as does
CFC-ll/CFC-12 production, but requires a different chlorocarbon. In
fact, some plants are designed to manufacture either CFC-ll/CFC-12 or
3
CFC-22 by changing the chlorocarbon feed.
Since much of the CHC1. produced goes toward CFC manufacture, this
chemical is highly dependent on continuing CFC production. The CHC1_
is made from either CH, or methanol and Cl? as follows:
There are, however, fluorspar mines within the United States
owned by Allied and Pennwalt.
2
A small amount of coproduct CFC-23 is also produced in this
process
3
Facilities of this type are referred to as campaign plants.
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CHC13 + 3HC1
CHC13 + HC1
HF manufacture was discussed previously, and the relevance of CH,,
CILOH and C12 has already been addressed.
CFC-113/114
There is less available information on the production of these
two CFCs than for CFC-11 and CFC-12. There are only two producers,
and frequently the data are considered proprietary. CFC-113 and
CFC-114 are manufactured using perchloroethylene (C.C1,), HF, and
Cl_ according to the chemical equations:
C2C14 + 3HF + C12 ->• C2C13F3 + 3HC1 (11-10)
(CFC-113)
C2C14 + 4HF + C12 -*• C2C12F4 + 4HC1 (11-11)
(CFC-114)
Less than 20 percent of total U. S. perchloroethylene output is
used in the manufacture of these CFCs. However, since much of it is
coproduced with CC14 as shown in Equation II-3, the implications of
limiting its production could be significant. Most of the remaining
C2C14 is produced using ethylene (C H^) and Cl to produce C C14 and
trichloroethylene (C HC1,,) according to Equation 11-12.
2C2H4 + 7 C12 -> C2HC13 + C2C14 + 7HC1 (11-12)
One of the CFC-113/CFC-114 producers, DuPont, employs a vapor
phase catalysis, while the other, Allied, utilizes a liquid phase
catalysis.
2
The disposal of HC1 produced in the process described by Equa-
tion 11-12 can be handled in a number of ways, according to industry
sources. Although we do not know the manner for dealing with the HC1
we rely on the industry assessment. Thus the HC1 generated from the
process given in Equation 11-12 will not be considered in the later
analysis.
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C-H, , a hydrocarbon in high demand, could readily find other uses
if CLC1, production were curtailed. The input Cl has already been
1
discussed.
PRECURSOR CHEMICALS
The production of each of the five CFCs is a final step in a
complex series of chemical reactions. The intermediate precursors,
those used directly in CFC manufacture, are, in turn, produced
using preliminary precursors. Table 1-1 summarizes the preliminary
and intermediate precursor chemicals that would be significantly
affected by a change in CFC production levels.
Table 'll-l
PRECURSOR CHEMICALS FOR CFC PRODUCTION
CFC
CFC-ll/CFC-12
CFC-22
CFC-113/CFC-11A
Intermediate
Precursor
CC1,
4
HF
CHCL
HF
C Cl
2 4
HF
Cl.
2
Preliminary
Precursor
C19
2
ci2
C19, CS.
2 2
Reference 2 states that 3 percent of the C Cl, is produced
using C2H_. This process will not be considered here since the
amount produced is negligible.
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III. HISTORICAL PRODUCTION
OFCFCs AND PRECURSOR CHEMICALS
In the last section, the processes for manufacturing the CFCs
were described, and the precursor chemicals used in these processes
were identified. Potential regulatory strategies for limiting CFC
emissions would lead to lower CFC production levels and, consequently
lower precursor chemical production requirements. The CFC aerosol
propellant ban has had major effects on production of some CFCs and
precursor chemicals. In light of future potential CFC emissions
limitations, it is thus useful to examine the historical trends. In
this section we present historical CFC production and sales data.
These data, together with historical precursor chemical production
figures, permit estimates of the portion of each precursor chemical
used for CFC manufacture.
CFC-ll/CFC-12
The historical production data on CFC-ll/CFC-12 are quite ex-
tensive and show good general agreement from source to source. Table
III-l shows production for 1970 to 1977 taken from Reference 3. His-
torical sales, which differ from production for a number of reasons,
are also shown in Table III-l.
The values of Table III-l illustrate that CFC-11 and CFC-12
production increased through 1974 and exhibited an abrupt decline in
2
1975. Prices of all chemicals increased markedly in 1974 and this
may have acted to reduce demand for CFCs. In addition, the fear of
shortages in 1974 resulted in large inventories in the supply chain.
One further event which almost surely contributed to the decrease in
production was the initiation of discussions concerning proposed con-
trols over CFC propellants.
The reasons for this difference are discussed in Section IV.
2
This was, in part, a result of the increase in petroleum prices
which occurred at that time.
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Table III-l
CFC-ll/CFC-12 PRODUCTION AND SALES--1970-1977
(millions of pounds)
Year
1970
1971
1972
1973
1974
1975
1976
1977
o
Production
244
258
300
334
341
270
256
213
CFC-11
(Percent
of Total)
(39)
(40)
(41)
(41)
(41)
(41)
(39)
(37)
Sales
237
237
286
329
321
254
239
197
*a
Production
375
390
439
489
487
393
393
358
CFC-12
(Percent
of Total)
(61)
(60)
(59)
(59)
(59)
(59)
(61)
(63)
Salesa
356
372
419
464
449
375
371
340
Total
Production
619
648
739
823
828
663
649
571
K3
I
Figures were taken from Reference 3.
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-13-
CFC-22
Historical CFC-22 production and sales as given in various
references is shown in Table III-2. Production of CFC-22, like that
of CFC-11 and CFC-12, shows a decline from 1974 to 1975. However,
unlike CFC-11 and CFC-12 production, CFC-22 production increased
dramatically from 1975 to 1977. We note that CFC-22 sales as a
fraction of production averaged about 72 percent for the period; the
value for CFC-ll/CFC-12 sales was approximately 95 percent. The
reason for this difference is discussed in Sections IV and V.
Table III-2
CFC-22 PRODUCTION AND SALES—1970-1977
(millions of pounds)
Year
1970
1971
1972
1973
1974
1975
1976
1977
Production
ioob
112b
V,
123
136b
141b
132a
170a
179a
Sales3
73
80
80
97
112
94
126
129
Values were taken from Reference 3.
Values were taken from Reference 1.
-------
Table III-3
CFC-113/CFC-114 PRODUCTION AND SALES—1970-1977
(millions of pounds)
Reference 1
Year
1970
1971
1972
1973
1974
1975
1976
1977
Production
CFC-113 CFC-114
36 22
43 23
50 25
59 26
64 27
—
—
—
Estimates
CFC-113
Production
43
44
51
68
72
65
72
84
Sales
41
42
49
64
69
62
69
80
CFC-114
Production
35
39
43
43
44
39
37
25
Sales
29
33
37
37
38
33
31
19
Total Production
78
83 £
94
111
116
104
109
109
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-15-
CFC-113/CFC-114
CFC-113/CFC-114 production is not as readily available as for
the other CFCs. Reference 3 has a category entitled "all other
fluorinated hydrocarbons," which presumably includes, but does not
specify individually, CFC-113 and CFC-114 production and sales.
Table III-3 shows CFC-113 and CFC-114 production and sales from
Reference 1 and as estimated by Rand. For purposes of this study,
the Rand estimates will be adopted since they derived from recent
conversations with industry sources and therefore should be more
reliable.
Table III-3 also shows the familiar decline in production from
1974 to 1975 for both CFC-113 and CFC-114. One apparent difference
between CFC-113 and CFC-114 is that CFC-113 shows an increase in sales
from 1975 to 1977 while CFC-114 shows a decrease. CFC-113 and CFC-22
are the only two CFCs which do exhibit this behavior. The reason this
trend might be expected for both CFCs is that only a miniscule amount
of each has been used to charge aerosol products, and production
would therefore not have been significantly affected by anticipation
of the propellant ban.
PRECURSOR CHEMICALS
The precursor chemicals that are highly dependent on CFC manu-
facture were identified in Section II as CC1,7 HF, CHC13, C-Cl,, CS2,
and Cl . The chemical equations for CFC manufacture together with
process efficiencies provide the basis for estimating precursor
chemical requirements for CFC production.
Appendix A presents the detailed procedure for calculating
precursor chemical requirements. Using the chemical equations and
industry-supplied data on individual process efficiencies, factors
End uses for each CFC are discussed more fully in Section IV.
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-16-
representing the fraction of each precursor chemical necessary for
a unit of CFC production were developed. These factors multiplied
by a specific level of CFC production give the corresponding pre-
cursor chemical requirements.
To illustrate this procedure, Appendix B presents estimates of
the precursor chemical requirements for historical CFC production.
The estimates are compared with information contained in available
data sources. Total production of the precursor chemicals is also
given to determine the portion of each precursor chemical devoted
historically to CFC manufacture.
Table III-4 summarizes the estimates of each precursor chemical
required for historical CFC production and also gives the quantity of
HC1 produced as a byproduct in CFC and some precursor chemical pro-
duction processes. The percent of total production of each precursor
chemical which went toward CFC manufacture during this time are provided
Table III-4
PRECURSOR AND BYPRODUCT CHEMICALS
FOR CFC MANUFACTURE—1970-1977
(millions of pounds)
Year
1970
1971
1972
1973
1974
1975
1976
1977
cci4
766
801
913
1017
1022
819
803
708
HF
245
260
291
325
331
279
296
281
CHC13
145
162
178
197
204
191
247
260
C2C14
75
79
90
106
110
99
103
102
cs2
151
158
181
201
202
162
159
140
Cl Byproduct HC1
1438
1520
1722
1924
1945
1617
1690
1572
846
897
1014
1132
1146
957
1054
951
SOURCE: Tables B-l through B-ll
-------
-17-
in Table III-5. A significant portion of CC1, , HF, and CHC1., pro-
duction demand was devoted to CFC manufacture.
The techniques developed in this section are intended to illus-
trate an approach for determining the precursor chemical requirements
for CFC manufacture. With this framework, given CFC production for
any future year, a simple calculation will yield the corresponding
amounts of precursor chemicals needed.
Table III-5
PERCENTAGE OF PRECURSOR CHEMICAL PRODUCTION
DEVOTED TO CFC MANUFACTURE—1970-1977
Year
1970
1971
1972
1973
1974
1975
1976
1977
CC1. HFa
4
76
79
92
97 44
88 41
90
94 46
88
CHC13
60
70
76
78
68
73
85
86
r n PQ n
^24 2 2
10
11
12 23
15 — 9
15 26 9
14
15
17
ETotal production for HF is unavailable for the historical
period. Reference 4 gives 1973 total production as 733 million
pounds, and Reference 5 gives 1974 production as 799 million pounds.
Industry sources have indicated that in 1976, 46 percent of total
HF went toward CFC manufacture.
References 6 and 5 give total 1972 and 1974 CS2 production as
775 and 772 million pounds respectively.
°References 6 and 5 give total C12 production figures for 1973
and 1974 of 20,804 and 21,236 million pounds respectively.
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-18-
IV. HISTORICAL CFC END USE
In the previous two sections, a method for estimating precursor
chemical production requirements from CFC production data was devel-
oped. To evaluate the implications of reducing CFC emissions, we
also need techniques for relating CFC emissions to CFC use which can
ultimately be translated into CFC and precursor chemical production.
Reference 8 examines 1976 CFC use and emissions in detail. These data
can be used to relate CFC emissions to CFC use in the historical case.
In this section, we develop a method for translating historical
CFC production into historical CFC end use. Estimates of historical
CFC nonaerosol use, together with the data of Reference 8, show the
method to be a reasonable one for translating a reduction in CFC non-
aerosol use directly into a reduction in CFC production requirements.
NON-USE EMISSIONS
Section III implicitly assumed that emissions during the CFC
production process occur prior to the reporting of production figures.
Reference 4 cites emissions estimates from production, storage, and
transport as 1 to 2 percent of total production. More recent esti-
mates from industry sources of 2 percent from production and a fur-
ther 2 percent from post-production activities (but prior to use)
are adopted here.
It will be assumed that the reported historical values for CFC
2
production already reflect the 2 percent production emissions loss.
Although one producer reports 1 percent losses, the 2 percent
loss is used as an industry average.
2
Those emissions which are classified as "production emissions"
probably refer to losses of CFC which occur during the manufacturing
process. It seems reasonable to assume that the reported production
figures reflect the amount of CFC remaining after these losses have
taken place. Many sources subtract production emissions from the pro-
duction figures; however, in this study, values for production will be
used with the assumption that these losses have already been taken into
account. Thus, production refers to the amount of CFC present in the
storage tanks of the producers.
-------
-19-
The additional 2 percent loss from such activities as distribution,
storage, packaging, and transport, remains to be considered.
In many cases, the CFC user does not purchase directly from the
producer. The producer may sell the CFC to a distributor who will
frequently repackage it before delivery to the user. Many large
users also repackage CFC prior to use. Unfortunately, data specifying
the losses during these different practices do not exist. Thus it will
be assumed here that the sales figures refer to producer sales, and
that the storage, packaging, and transport emissions occur after these
sales take place. Undoubtedly, some of these emissions occur before
and some after sales; however, since the sales and production values
do not differ significantly, the error introduced by assuming that
emissions occur following sales is insignificant.
One of the purposes of this study is to estimate and examine the
economic effects of reducing the emissions from nonaerosol CFC uses.
Even though the emissions described above occur prior to use, they
are nevertheless an emissions source of CFC. In our opinion, current
emissions from production, storage, packaging and transport are prob-
2
ably as low as can reasonably be expected at current CFC prices.
Because production emissions occur prior to producer sales, the pro-
ducer has an economic incentive to be conservative with the CFC. The
same situation applies to emissions from packaging by distributors or
users since all parties involved are concerned with maximizing the
amount of CFC ultimately available for sale or use. It is therefore
Reference 3, from which the sales figures for CFC-11, CFC-12,
and CFC-22 were taken, cites sales as those by the original manu-
facturer.
2
The energy crisis provides a useful analogy. As energy prices
increased, conservation techniques and practices, which may have once
seemed extreme, became commonplace. If CFC prices were to increase,
industry would almost certainly find ways to reduce these emissions
further. The technology for achieving this reduction is obviously
currently available since emissions from production of chlorocarbons
are negligible, as discussed in Appendix A.
-------
-20-
probably reasonable to assume that unless a program of specific
regulation on CFC output were enacted, there would be no reduction
in these emissions.
INTERMEDIATE/IN-HOUSE USE
The difference between the values given in Section III for CFC
production and sales can be attributed to intermediate and/or in-house
2
use of the CFC by the manufacturers. One example of intermediate use
by producers is the use of CFC-114 to produce CFC-115 which is com-
bined with CFC-22 to produce CFC-502, a refrigerant. There are
numerous other intermediate uses for each of the CFCs where emissions
are negligible. We accept that most of the difference between the
production and sales figures of Section III is due to these consumptive
uses of CFC that are not directly categorized as emissions.
Reference 9 details many small in-house uses of the CFCs, the most
common of which are refrigerants and solvents. This reference includes
CFC-113 in-house use in the sales figures. Consequently, for this CFC,
it will be assumed that in-house uses do not account for the difference
between production and sales. For the other CFCs, the in-house use,
together with intermediate use, accounts for the total difference be-
tween the sales and production figures.
INVENTORIES
The CFCs are inventoried in various places between production and
use. They may be stored by the producer prior to delivery, quantities
may be held at distribution or packaging points, and some may be in
transit in tank cars, cylinders, or drums.
Industry sources indicate that there is ongoing research intended
to reduce these emissions so that yields can be increased and costs de-
creased.
2
Intermediate use is defined here as use of the CFC for direct
conversion into another chemical compound. In-house use is defined as
use of the CFC itself.
3
CFC-502 is 48.8 percent CFC-22 and 51.2 percent CFC-115 by
weight.
-------
-21-
Industry sources indicate that 15 to 30 days elapse between CFC
sales and delivery for use. It therefore seems reasonable to assume
that about 6 percent of each year's sales will not be available for
emission until the following year." To a large extent, inventories
available from a previous year will cancel those taken out in a cur-
rent year. For this reason, inventories are not considered further
in this analysis.
EXPORTS
We have been told by knowledgeable sources that CFC imports have
historically been negligible. However, exports evidently account for
a more significant portion of sales. Although there is no information
on the amount of each CFC exported, there are some data on total CFC
exports.
Reference 4 indicates that 7 percent of the CFCs produced in 1973
fall into a category entitled "exports and other." In Reference 5,
exports are listed as having accounted for 4 percent of 1973 production.
Knowledgeable sources claim that CFC-113 annual exports are 4 to 6 per-
cent of sales. Given these data, it will be assumed that annual exports
were historically about 5 percent of sales.
AEROSOL USE
Each of the CFCs has more than one end use although, generally,
one primary application consumes a very large portion of use in each
case. Since we are concerned only with the nonaerosol uses and emis-
sions of the CFCs in this study, we need to estimate the magnitude of
historical use in aerosols, since the propellant ban will prevent CFC
4
from being used for this purpose in the future. Three of the CFCs
One industry source states that this time is 24 hours for bulk
sales.
2
It would serve no purpose to detail inventories on a more fre-
quent basis than annually.
In the future, this assumption may not be valid.
4
Anticipation of the aerosol ban led to many changes in the CFC
and precursor chemicals industries, which are discussed in more detail
in Section V.
-------
under consideration in this study, CFC-11, CFC-12, and CFC-114 were
used historically as aerosol propellants. There is no indication that
significant amounts of either CFC-22 or CFC-113 were used in this way.
Table IV-1 shows our estimates of 1976 production, intermediate use,
sales, emissions, exports, aerosol use, and nonaerosol use for each CFC.
Nonaerosol end use is the difference between the sales figures and emis-
sions, exports, and aerosol use. Appendix C presents complete historical
(1970-1977) estimates for the CFC apportionment, and discusses the values
for aerosol use in detail. The method for allocating CFC to the various
destinations of Table IV-1 is described mathematically in Appendix D.
NONAEROSOL USE
Reference 8 specifically addresses CFC nonaerosol use in all major
and some minor applications. Estimates of current and future use for
each CFC are presented. In most cases, 1976 was chosen as the most re-
cent historical point for which data were available. Comparison of
these data with the values for nonaerosol use in Table IV-1 provides an
indication of the validity of the method of accounting for the CFC after
it is produced.
Table IV-2 presents the amount of each CFC that went toward selected
end use categories in 1976 as taken from Reference 8. These include
various foam and refrigeration applications as well as solvents, LFF
(Liquid Fast Freezing), and sterilants. There are various other uses
for the CFCs that have not been included in Table IV-2. We refer to the
categories of CFC use included in Table IV-2 as analyzed applications
while all other CFC uses are unanalyzed applications.
The values of Table IV-2 for CFC-11 indicate that the major amount
of this CFC was consumed in the manufacture of foams in 1976. Smaller
quantities were used in refrigeration and miscellaneous applications
in 1976. According to Reference 9, CFC-11 was also used in industrial
refrigeration applications which could account for the balance of the
19 million pounds.
Some CFC-113 is packaged in aerosols and used for cleaning pur-
poses. In these cases, however, the CFC-113 is not used as the pro-
pellant. In any event, this application accounts for a negligible
percentage of total CFC-113 use.
-------
Table IV-1
CFG APPORTIONMENT—1976
(millions of pounds)
CFC
CFC-11
CFC-12
CFC-22
CFC-113e
CFC-114
Production
256
393
170
72
37
Intermediate
Use
17
22
44
6
Sales
239
371
126
31
a
Emissions
5
7
3
1
b
Exports
12
19
6
2
Aerosol
UseC
123
156
— —
26
Xonaerosol
Use"
99
189
117
69
2
i
N;
u;
1
Emissions cited in the table are those resulting from storage, packaging, and transport
and do not include CFC emitted during the production process.
Estimated at 5 percent of sales.
£
Estimated from available sources and industry-supplied data. See Appendix C for details.
Sales minus emissions minus exports minus aerosol use.
Reference 8 describes CFC-113 in detail.
-------
-24-
Table IV-2
ESTIMATED CFC NONAEROSOL END USE-1976
(millions of pounds)
Analyzed Applications CFC-11 CFC-12 CFC-22 CFC-113 CFC-114
Flexible Foam
a
Solvents
Rigid Foams:
Urethane
Nonur ethane
Mobile Air Conditioning
Other Refrigeration:
Chillers
Home Refrigerators
and Freezers
Retail Food
Misc ellaneou s :
LFF
Sterilants
Other
TOTAL
34
—
35
2
—
8
—
—
—
—
1
80
—
2
21
90
5
6
11
6
13
3
157
69
—
—
—
3 — 1
—
1
— —
— —
—
4 69 2
NOTE: Uses reported for individual applications exclude:
5 million pounds each of CFC-22 and CFC-115 used to form CFC-502;
less than 1 million pounds each of CFC-12 and CFC-152a used to
form CFC-500.
ft
Refrigeration and other relatively small miscellaneous uses
of CFC-113 are included in the solvents data.
Although most of the CFC-12 is used in refrigeration applica-
tions, it is also used in numerous other applications. Comparison
of the CFC-12 values of Tables IV-1 and IV-2 implies that more than
30 million pounds were used in unanalyzed applications in 1976.
Indeed, Reference 9 indicates that a large amount of CFC-12 was
used in industrial, transportation, and cold storage refrigeration.
The values of Table IV-2 show that only a small amount of
CFC-22 was used in the analyzed applications. Part of the balance
was probably consumed in other refrigeration (primarily air condition-
ing) applications. Industry sources have stated that a large portion
-------
-25-
of the CFC-22 Is used to produce tetrofluoroethylene (TFE) from which
teflon is manufactured. Although the large intermediate use of CFC-22
may account for this use, it could be that a large amount of CFC-22 is
also sold for TFE production.
In the case of CFC-113, the solvent application accounts for
96.3 percent of the CFC-113 available for use. Although possibly
2 million pounds was used to manufacture foam and in refrigeration
applications, all CFC-113 use is shown for solvents.
Table IV-1 shows that about 2 million pounds of CFC-114 were
available for nonaerosol end use. The values of Table IV-2 agree
well with this estimate, allocating about 1 million pounds each to
foam manufacture and use as a refrigerant in chillers.
The method for relating CFC production to CFC end use seems to
provide reasonable values for 1976 in light of the data of Refer-
ences 8 and 9. There remains, however, some degree of uncertainty in
the estimates of the parameters. For example, although industry
sources cannot specify export levels for each CFC, they have indicated
that the estimates derived here may be slightly high. However, with-
out more detailed information on the magnitude of the exports, the
estimates must suffice.
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-26-
V. CFC AND PRECURSOR CHEMICAL PRODUCERS
An understanding of CFC and precursor chemical market features
will provide insight into the possible behavior of the producers
under the conditions that a given future policy might imply. The ban
on CFC use as propellants had an influence on the CFC and precursor
chemical markets even before it was fully effective. The responses
of the producers to this impending limitation may provide an indi-
cation of future behavior if regulations regarding nonaerosol CFC
emissions were enacted. In this section, both historical and current
market features are discussed and some implications of reduced pro-
duction requirements are examined.
CFC PRODUCERS
DuPont is the largest U. S. producer with an annual capacity of
more than half of the entire industry. Allied is the. second largest
U. S. producer. These two producers manufacture all five CFCs. Only
CFC-11, CFC-12, and CFC-22 are manufactured by the other three pro-
ducers: Kaiser, Pennwalt, and Racon.
Annual Capacity
An important factor in a competitive market is the relative
market share held by each of the participants. Unfortunately, for
obvious reasons, production and sales data for each of the individual
CFC producers are not publicly available; however, total industry
data as given in Section II do exist for each CFC. These data,
together with company specific production capacity, provide the basis
for deriving estimates of each firm's portion of total sales.
Various references list the capacities of each producer for
particular years. As will be seen shortly, a number of changes have
taken place since the information contained within these references
was obtained. Table V-l gives the capacities specified by two refer-
ences, and also the capacities which we believe are currently more
accurate.
-------
Table V-l
CFC CAPACITY BY U.S. PRODUCERS
(millions of pounds)
Firm
Allied
DuPont
Kaiser
Pennwalt
Racon
Union Carbide
TOTAL
Reference 4
1973
Capacity
310
500
50
115
20
200
1195
•a
Percent
of Total
25.9
41.8
4.2
9.6
1.7
16.7
100.0
Reference 1
1976
Capacity
319
695
80
115
35
200
1435
Q
Percent
of Total
21.6
48,4
5.6
8.0
2.4
13.9
100,0
Estimated
1978
Capacity
240
600
80
90
50
—
1060
Percent
of Total
22,6
56.6
7.6
8.5
4.7
—
100,0
aThe values may not add to 100 percent due to rounding.
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-28-
The differences between the estimated 1976 capacities and those
of the other references may be attributable to plant closings. For
example, Union Carbide recently discontinued direct CFC production,
while DuPont, Allied, and Pennwalt closed entire facilities or por-
tions of them. The closing of these plants undoubtedly resulted
from anticipation of the aerosol ban, and should have involved pri-
marily CFC-ll/CFC-12 plants.
Capacity for CFC-114, which was also used in aerosols, would not
be affected since the amount produced is relatively small and CFC-114
plants are also used to produce CFC-113. It is true, however, that
within the last few years, two CFC-113/CFC-114 plants were closed by
current producers, as old units were phased out to bring new units
onstream. One notable event for which there is no obvious explanation
is that several years ago, Pennwalt and Union Carbide joined the
CFC-113 market, but left shortly thereafter. It may well be that the
CFC-113 demand could not support plants owned by four producers.
Table V-l shows the shift which occurred in the capacity share
held by each producer in the time period reflected by the values of
Reference 4 and those estimated for 1978. Racon, Kaiser, and DuPont
increased their capacity shares significantly, while Pennwalt's and
Allied's shares declined. The increase in share experienced by some
of the producers was governed by Union Carbide's discontinuing pro-
duction. It is clear, however, that the share held by Union Carbide
was not subsequently spread evenly among the other five producers.
Given the producers' total capacity, we now want to consider the
capacity for each CFC held by each producer. It is estimated that
DuPont holds about two-thirds and Allied one-third of total CFC-113/
CFC-114 capacity estimated at 150 million pounds. Reference 5 gives
the capacity of DuPont's single CFC-22 production facility as 120
million pounds; that estimate will be adopted here. The balance of
Although CFC-114 is largely used in aerosols, CFC-113 produc-
tion currently represents about 76 percent of total CFC-113/CFC-114
production. Thus, CFC-113/CFC-114 plant closings would .be unlikely
to occur based on less CFC-114 production. In fact, in 1977 only
14 million pounds of CFC-114 went toward aerosol uses.
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-29-
DuPont's capacity, 380 million pounds, can be allocated to CFC-11
and CFC-12 according to the 1977 relative production of each. After
accounting for CFC-113/CFC-114 capacity, Allied has 190 million pounds
of capacity remaining for CFC-11, CFC-12, and CFC-22. In 1977, CFC-22
production represented about 24 percent of combined CFC-11, CFC-12, and
CFC-22 production. If this percentage is applied to Allied's capacity
for these three CFCs, it is estimated that Allied's CFC-22 capacity is
45 million pounds. CFC-11 and CFC-12 capacities are then 54 and 91
million pounds respectively.
It will be assumed that this same reasoning applies to Pennwalt
and Kaiser, who each have one plant which produces the three CFCs.
Racon has one CFC-ll/CFC-12 plant, and two plants devoted entirely to
CFC-22 production. Thus, CFC-22 may account for as much as half of
Racon's production, and it will be assumed that this is the case.
Given these assumptions, Table V-2 presents the estimated capac-
ity and percent of total capacity for each CFC held by the individual
producers. Appendix E presents historical CFC capacity as well as a
method of apportioning capacity to each CFC.
Table V-2
1977 CAPACITY APPORTIONMENT
(millions of pounds)
Annual Capacity (Percent of Total Capacity)
Producer
Allied
DuPont
Kaiser
Pennwalt
Racon
TOTAL
CFC-11
54
142
23
26
6
251
(22)
(57)
(9)
(10)
(2)
(100)
CFC-12
91
238
38
43
19
429
(21)
(56)
(9)
(10)
(4)
(100)
CFC-22
45
120
19
21
25
230
(20)
(52)
(8)
(9)
(11)
(100)
CFC-113
38
77
115
(33)
(67)
(100)
CFC-114
12
23
35
(33)
(.67)
(100)
Total
240
600
80
90
50
1060
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-30-
CFC Sales
To gain a real understanding of the effects of potential regu-
lations on the CFC industry, we would ideally like to have CFC sales
data for the individual firms and total company sales data. Since
these data are not available, estimation techniques are necessary.
The apportionment of capacity to each producer in Table V-2
can be useful for determining the historical revenues derived from
CFC sales. If the amount of each CFC sold historically is known,
the apportionment scheme can be used, together with CFC prices, to
determine the CFC sales revenue realized by each producer.
In the previous subsection, estimated capacities for each CFC
were apportioned to each producer based on available capacity data
and historical production figures. The 1977 sales of each CFC can be
apportioned to the individual firms according to the percentage allo-
cations of Table V-2. Although this table was developed on the basis
of 1978 estimated capacities, it should be applicable to 1977 as well.
CFC pricing information is sparse and often does not refer to the
actual price at which the CFC was sold. Reference 3 gives the sales
value and amount sold for CFC-11, CFC-12, and CFC-22 for 1970 through
1977. These values are shown in Table V-3 and exclude any revenue
derived from sale as an intermediate. Prices for CFC-11, CFC-12, and
CFC-22 changed only slightly from 1976 to 1977.
Table V-3
CFC SALES AND SALES VALUE3
CFC-11
Year 10 Pounds Million $
1976 239 81.6
1977 197 66.9
CFC-12
10 6 Pounds Million $
371 151.4
340 135.9
CFC-22
105 Pounds Million $
126 88.3
129 88.1
The values in this table were taken from Reference 3.
As will be seen shortly, CFC is often priced according to size
of purchase. Thus, unknown amounts are purchased at prices which
have a considerable variance.
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Unfortunately, the values of sales for CFC-113 and CFC-114 are
unavailable. Table III-3 gave our estimates of the quantities of
these two CFCs sold in 1977. Using this information in conjunction
with 1977 CFC-113 and CFC-114 prices, a value of sales could be
determined for each. Table V-4 gives our estimates of historical
CFC-113 bulk prices and the only available CFC-114 price for the
historical period. Use of these bulk prices will almost certainly
lead to an underestimation of sales value. Nevertheless, the 1977
CFC-113 price of 56 cents per pound results in a 1977 CFC-113 sales
value of 45.4 million dollars. Using 65 cents per pound as the
CFC-114 selling price leads to a sales value of 12.4 million dollars.
Table V-4
CFG HISTORICAL PRICES—1970-1977
(cents per pound)
Year
1970
1971
1972
1973
1974
1975
1976
1977
CFC-113a
40
40
40
38.4
43.3
48.5
52
56
CFC-114
—
—
—
65b
— —
aThese prices for CFC-113 are
bulk prices.
bA "1974" price for CFC-114 and
the other CFCs is given in Reference 2.
These prices are 35, 42, 63, 63, and 65
for CFC-11, CFC-12, CFC-22, CFC-113, and
CFC-114 respectively. The report is
dated December 1975, and comparison with
the prices implied in Table V-3 indicates
that these are probably actually 1975
prices. Prices for CFC-114 for the
other years are not available.
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Table V-5 shows the allocation of the 1977 sales for the five
CFCs to each producing firm. The values were derived by assuming
that sales value can be apportioned according to the portion of
capacity held by each producer as given in Table V-2. The 1977 CFC
sales of each firm may be more meaningful when compared with total
company sales, as shown in Table V-6.
The limitations of Table V-6 in representing the actual sales
attributable to each firm are obvious. For example, it is true that
all of Racon's sales are from sales of CFCs. The values of Table V-6
indicate that direct sales of CFC-11, CFC-12, and CFC-22 account for
only about 55 percent of Racon's total sales. A number of factors
could contribute to the understatement of Racon's sales and also to
the understatement of the sales of all producers. These factors are
discussed in Appendix F.
Table V-5
1977 CFC SALES
(millions of dollars)
a
Producer
Allied
DuPont
Kaiser
Pennwalt
Racon
Total
CFC-11
14.7
38.2
6.0
6.7
1.3
66.9
CFC-12
28.6
76.2
12.2
13.6
5.4
136.0
CFC-22
17.5
45.6
7.0
7.9
9.6
72.7
CFC-113
15.0
30.4
—
—
—
45.4
CFC-114
4.1
8.3
—
—
—
12.4
Total
79.9
198.7
25.2
28.2
16.4
348.4
Assumes prices of 34 cents per pound for CFC-11, 40 cents per
pound for CFC-12, 68 cents per pound for CFC-22, 56 cents per pound
for CFC-113, and 65 cents per pound for CFC-114.
This allocation method is based on the assumption that the
amount of CFC produced by each firm is directly proportional to the
fraction of total capacity held by that firm. This may not be valid
in that some firms may produce at greater than stated capacity, and
others at less than stated capacity.
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Table V-6
1977 CFC AND TOTAL SALES
(millions of dollars)
Producer
Allied
DuPont
Kaiser
Pennwalt
Racon
CFC
Sales
79.9
198.7
25.2
28.2
16.4
Total
Salesa
2922.8
9434.8
2179.6
834.9
29.7
CFC Percent
of Total
2.7
2.1
1.2
3.4
55. 2b
•a
Total sales were obtained from Moody's
Industrial News Report, Vol. 49, 1978.
Racon1s CFC sales are actually 100 per-
cent of total sales.
PRECURSOR CHEMICAL PRODUCERS
The market for the chemicals which are precursors to CFC manu-
facture is more difficult to assess than the CFC market itself. The
CFCs are the end product in a long chain of production involving a
number of chemical processes. Many of the chemicals in this chain
can be manufactured using two or more different processes, and most
are used for a variety of purposes in addition to CFC manufacture.
The details of the capacity allocation to the producers of each pre-
cursor chemical are given in Appendix G.
The results of the allocation indicate that the CFC manufacturers
are heavily back-integrated into precursor production. Table V-7
indicates the magnitude of this involvement for each precursor chem-
ical. No year is given in this table since the capacity allocations
for the precursor chemicals were often given for different years. It
should be stressed that the values of this table refer to precursor
chemical production for CFC manufacture and not industry-wide pre-
cursor chemical production.
Of the CFC producers, the two largest, DuPont and Allied, are
the most heavily integrated into manufacture of the precursor chemicals
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considered here. Two points to note are that Racon does not pro-
duce any of the precursor chemicals, and that CS is not produced
z 2
by any of the CFC manufacturers according to Table V-7.
If future CFC production were limited, many of the precursor
chemical producers who are not CFC manufacturers would also be sig-
nificantly affected. Dow Chemical, the largest producer of the three
chlorocarbons and Cl^, would undoubtedly be one of these. Other com-
panies which appear to be heavily involved in precursor production
include Stauffer and Vulcan Materials.
Table V-7
PRECURSOR CHEMICAL PRODUCTION FOR CFCs
(millions of pounds)
Producer
Allied
DuPont
Kaiser
Pennwalt
Racon
Other
Total
cci4
151
399
__
—
—
158
708
HF
98
88
60
30
— b
6
282
CHC13
52
—
—
—
207
259
C2C14
—
67
—
—
33
100
cs2
—
__
a
—
140
140
C12
318
670
8
16
—
558
1570C
CFC Producers'
Percent of Total 78 98 20 67 0 64
a
Pennwalt does produce CS_, although not for CC1,.
There are other HF producers whose HF does not go toward CFC
manufacture.
c
This value excludes the production by the paper companies as
discussed in Appendix G.
If other precursor chemicals were included, the other CFC produ-
cers might show the back integration as markedly as DuPont and Allied.
2
The lack of CS2 back integration reflects the fact that most of
the CC1, used in CFC manufacture is not produced using CS_.
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VI. FUTURE PRODUCTION
AND THE EFFECTS OF POLICY ACTION
The relationships developed here for determining CFC and pre-
cursor chemical production based on a particular level of CFC use
can be used to estimate future requirements. In this section, we
present projections of base case 1990 CFC end use. We also provide
CFC production estimates based on industry supplied data and the
implied precursor chemical requirements. We then examine five
scenarios for reducing CFC emissions and discuss the implications
of each on the CFC and precursor chemical producing industries.
1990 CFC END USE
In Reference 8, projections of 1990 base case CFC use for
most CFC applications are developed. These data are shown in
2
Table VI-1. The analyzed applications did not include those in
which CFC-22 is heavily used (for example, home air-conditioning),
since that CFC is thought to pose less of a hazard to the ozone
layer than the fully halogenated CFCs.
CFC PRODUCTION AND SALES
Two knowledgeable industry sources provided us with data from
which projections of CFC production could be derived. The tech-
niques developed here for relating CFC production to the CFC avail-
able for use were then employed. Table VI-2 shows these estimates
of future production and the amount of CFC available for use.
The values of CFC-11 for use in analyzed applications in Table
VI-1 conflict with the projections of use in Table VI-2. The large
variation in the production data supplied by industry sources for
this CFC might account for the discrepancy.
The analyzed product areas account for about three-quarters of
total CFC use.
2
Reference 8 provides a detailed description of the techniques
used to derive the data.
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Table VI-1
ESTIMATED NONAEROSOL CFG END USE—1990
(millions of pounds)
Analyzed Applications CFC-11 CFC-12 CFC-22 CFC-113 CFC-114
Flexible Foam
Solvent sa
Rigid Foams
Ur ethane
Non-ur ethane
Mobile Air Conditioning
Other Refrigeration
Chillers
Home Refrigerators
and Freezers
Retail Food
Miscellaneous
Liquid Fast Freezing
Sterilants
Other
TOTAL
72
—
154
8
—
14
—
—
—
—
4
252
__
147
5
59
125
6 4 —
Q
10 1
]^5 __
40
11
280 5 147
1
2
—
—
—
—
—
3
SOURCE: Values were taken from Table 3.3 of Reference 8.
NOTE: Uses reported for individual applications exclude:
about 7 million pounds of CFC-22 and 8 million pounds of CFC-115
used to form CFC-502; 2 million pounds of CFC-12 and less than
1 million pounds of CFC-152a used to form CFC-500.
a
Refrigeration and other relatively small miscellaneous uses
of CFC-113 are included in the solvents data.
Reference 9 indicates that CFC-12 is used in mobile and indus-
trial refrigeration applications. These uses could account for the
difference of 47 million pounds in the total CFC-12 figure of
Table VI-1 and the end use value of Table VI-2.
The accuracy of the CFC-22 end use projections of Table VI-2
cannot be confirmed by comparison with the value of Table VI-1
since Reference 8 analyzed very few CFC-22 applications.
The end use values for CFC-113 in Tables VI-1 and VI-2 show
perfect agreement since projections for both estimates were derived
using the same data. The same holds true for CFC-502 end use,
which is referred to in the note to Table VI-1.
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Table VI-2
ESTIMATED NONAEROSOL CFC PRODUCTION
AND END USE--1990
(millions of pounds)
CFC
CFC-11
CFC-12
CFC-22
CFC-113
CFC-114
CFC-502
Production
262
363
385
147
32
16
End Use
228
327
265^
I47b
25
15
SOURCE: Industry supplied data and
calculations as described in the text.
*a
The values for end use were calcu-
lated under the assumption that use will
continue to be the same fraction of pro-
duction as in 1976.
The end use values for CFC-113
include estimates of imports, while
those for the other CFCs do not.
The value for 1990 end use of CFC-114 in Table VI-2 is far
higher than the total value for analyzed uses in Table VI-1. The
analyzed applications do not include intermediate use of CFC-114
for the production of CFC-115. Most of this intermediate use is
reflected in the difference between the values for production and
end use in Table VI-2. There are numerous specialty applications
in which CFC-114 acts as a refrigerant. Furthermore, the CFC is
used in various exempted aerosol applications, including some for
defense purposes. Although there are no available data on these
uses, they may account for the balance of CFC-114 end use.
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The 1990 values for CFC production given in Table VI-2 provide
the basis for considering the future CFC production capacity require-
ments. As mentioned earlier, the design capacity of a particular
production plant is only an approximation to the amount of the
chemical that is actually produced. Production of a chemical may be
less than the design capacity if the capacity is not fully utilized.
Alternatively, actual production may exceed the design capacity, some-
times by as much as 100 percent. Although the "rule of thumb" which
indicates that design capacity remains about 15 percent ahead of
actual production is useful, it is not necessarily always accurate.
Industry sources indicate that, in certain cases, plants may be run
at 200 percent of rated design capacity. Thus, any assessment of the
adequacy of current capacity for future production requirements is
necessarily somewhat speculative.
The values of Table VI-2 indicate that combined 1990 CFC-ll/CFC-12
production will be 625 million pounds. Existing capacity of CFC-11/
CFC-12 plants is about 680 million pounds according to the values of
Table V-2. This implies that if no policy action for limiting CFC
emissions is taken prior to 1990, current capacity will be sufficient
to produce CFC-11 and CFC-12 through 1990.
By 1990, CFC-22 production is estimated to be 385 million pounds
in the absence of policy action. The 1977 CFC-22 capacity cited in
Table V-2 is 230 million pounds. Some existing facilities were designed
to produce either CFC-ll/CFC-12 or CFC-22 by simply varying the pre-
cursor chemical feed. These plants could produce a mix of CFC-11/
CFC-12 and CFC-22. The 230 million pounds of CFC-22 capacity together
with the 55 million pounds of excess CFC-ll/CFC-12 capacity would not
be adequate to produce 385 million pounds of CFC-22 in 1990. However,
it is certainly possible that all plants could be run at higher than
design capacity. It seems reasonable to assume that existing capacity
will probably be adequate through 1990, but that shortly thereafter,
additional capacity will be necessary.
Current CFC-113/CFC-114 capacity is about 150 million pounds
according to the values of Table V-2. Combined CFC-113/CFC-114 produc-
tion in 1990 in the absence of policy action will total 179 million
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-39-
pounds. The production exceeds the existing design capacity by only
about 19 percent. Moreover, industry sources indicate that it takes
less capacity to produce one pound of CFC-113 than it does to produce
one pound of CFC-114. The same reasoning may also apply to CFC-11/
CFC-12 production. It seems reasonable to conclude that the current
capacity will probably suffice for the 1990 production levels, but
additional capacity will likely be needed a short time later.
Capacity for CFC-502 need not be considered. This CFC is pro-
duced by combining CFC-22 and CFC-115 which is in turn produced using
CFC-114. The 1990 production estimates of CFC-114 and CFC-22 given
in Table VI-2 include the CFC-114 used to manufacture CFC-115 and
the CFC-22 combined with it to form CFC-502.
PRECURSOR CHEMICAL PRODUCTION
Based on the CFC production levels of Table VI-2 and the methods
developed in previous sections, the 1990 baseline precursor chemical
requirements can be derived. These are shown in Table VI-3.
The values of Table VI-3 reflect only the amount of each pre-
cursor chemical required for CFC manufacture. They do not include
requirements for other applications. In other words, the values of
Table VI-3 represent the baseline 1990 precursor chemical require-
ments for the CFC production of Table VI-2.
By 1990, the baseline HF requirements for CFC production will
be 422 million pounds. According to the values of Table III-5, in
1976, 46 percent of the HF went toward CFC manufacture. Assuming
this same percentage to hold through 1990, the total HF requirement
in that year would be about 900 million pounds. If the "rule of
thumb" that plant capacity is 15 percent higher than production is
a reasonable estimating tool, HF capacity in 1990 should be about
Values for HF, C-C1,, CHC1_, and CS,., differ from those presented
in Table A-4 of Reference 8. In this case, precursor chemicals for
CFC-22 and CFC-114 are included, whereas they were not in Reference 8.
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Table VI-3
ESTIMATED PRECURSOR CHEMICAL
AND BYPRODUCT PRODUCTION—1990
(millions of pounds)
Year HF CCl, C0C1. CHCl,. CS_ Cl- HC1
424 3 2 2
1990 422 771 167 558 152 2224 1534
SOURCE: Derived as explained in the text.
1050 million pounds to produce the required HF. Since this is
significantly higher than the 1977 capacity of 683 million pounds
in Table G-2, HF capacity will probably be added by 1990.1
The values of Table VI-3 indicate that, by 1990, baseline
requirements of CCl, will be 771 million pounds. Assuming this value
represents 88 percent of total 1990 CCl, production and adopting the
"15 percent rule of thumb," 1990 CCl, capacity should be about 1000
million pounds. The total 1977 CCl, capacity (1205 million pounds)
o
given in Table G-l should therefore by adequate through 1990.
The 1990 C2C1^ baseline requirement for CFC manufacture of 167
million pounds leads to an implied capacity of about 1130 million
pounds assuming the "15 percent rule of thumb," and that 17 percent
of C2C14 will be devoted to CFC manufacture in that year. The 1977
total C2C14 capacity of 1180 million pounds given in Table G-3 should
be sufficient through that year.
The CHCl- baseline requirement in 1990, according to Table VI-3,
will be 558 million pounds. If 86 percent of the CHCl goes toward
CFC production in that year, the implied capacity will total about
750 million pounds. The current total capacity of approximately
Even more capacity would be necessary if Kaiser and Stauffer
were to close their HF facilities.
2
If FMC closes its facility, however, the capacity would not
be adequate.
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300 million pounds (Table G-3) would certainly be inadequate to
satisfy the need. To meet the 1990 requirement, current CHC1 capac-
ity would have to approximately double by that year.
According to Table VI-3, 1990 baseline CS2 requirements for CFC
manufacture will be 152 million pounds, only slightly larger than
the 1977 production of 140 million pounds. Existing capacity should
prove sufficient to satisfy the need.
Table VI-3 shows 1990 baseline Cl requirements for CFC produc-
tion as 2224 million pounds. Assuming that 9 percent of the Cl_ is
used for CFC manufacture in that year, the implied 1990 capacity
would be about 28,400 million pounds, about 6000 million pounds
higher than the 1977 capacity (Table G-5). Because this is only a
small percentage of the design capacity, Cl_ capacity for CFC manu-
facture probably will not be added before that time. Table VI-3 also
illustrates that in 1990, as a result of the CFC and precursor chem-
ical production requirements, there will be 1534 million pounds of
HC1 manufactured. This may or may not be a cost advantage depending
on the market for HC1 at that time.
The base line precursor chemical requirements serve as a basis
for determining the impacts on the producers if no policy action is
taken. However, in the event that policies for limiting emissions
are adopted, precursor chemical requirements will also be reduced.
FUTURE POLICY ACTION
In Reference 8, two general policy strategies for reducing
future emissions are discussed. The first strategy, mandatory con-
trols, involves setting rules and regulations requiring firms to
limit emissions by the use of specific technologies such as recovery
and recycle of CFC, equipment improvements, or chemical substitution.
The second strategy, economic incentives, entails manipulating CFC
prices so that it becomes profitable for firms to reduce emissions.
The implications of five policy designs involving these two
strategies were examined in Reference 8. The first, the benchmark
controls, is a mandatory control strategy. The other four policy
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designs are economic incentive strategies. Two of these, the con-
stant price design and the cost-minimizing design, achieve the same
reduction in emissions obtained through mandatory controls, about a
15 percent reduction in emissions between 1980 and 1990. The third
economic incentives strategy is a low-growth scenario in which
emissions would be reduced slightly more than under mandatory con-
trols. The final economic incentives strategy is zero-growth, which
would be equivalent in cumulative emissions reduction to prohibiting
growth in CFG use after 1980. A complete description of the features
of each policy is available in Reference 8.
Each of the five policies leads to a reduction in CFC emissions,
and thereby, to a reduction in CFC use. Table VI-4 presents these
CFC use reductions for the various policy cases for 1990. It should
Table VI-4
REDUCTION IN CFC USE UNDER BENCHMARK CONTROLS
AND FOUR ECONOMIC INCENTIVE POLICY DESIGNS—1990
(millions of pounds)
Policy Design
Benchmark
controls
CFC-11
40.5
CFC-12
20.3
CFC-113
32.5
CFC-114
-8.8
Economic Incentives Policies
That Achieve The Benchmark Reductions
Constant price
design 30.3 11.9 49.3 -8.8
Co s t-m in im iz ing
design 37.5 17.6 56.1 -8.8
Economic Incentives Policies
for Low- and Zero-Growth
Low-growth 57.8 36.4 79.3 -8.8
Zero-growth 57.8 36.4 79.3 -8.8
SOURCE: Table A-l of Reference 8.
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-43-
be emphasized that Reference 8, from which the values of Table VI-4
were taken, considered policies that would reduce CFC use only in
the applications analyzed in that document. Since no applications
using CFC-114 were analyzed, the table shows no reduction in CFC-114
resulting from the policy actions.
The precursor chemical requirement reductions that correspond to
the CFC reductions are shown in Table VI-5. The values were deter-
mined using the techniques developed here for relating CFC to pre-
cursor chemical production.
The values of Table VI-5 show an increase in CHCl- requirements
for all policy designs. This occurs because in each design, there
is a control strategy involving the substitution of CFC-502 for CFC-12
Table VI-5
REDUCTION IN PRECURSOR CHEMICAL REQUIREMENTS—1990
(millions of pounds)
Policy Design
Benchmark
controls
HF
21
CCIA
82
C2C14
24
CHC13
-7
cs2
16
C12
143
Economic Incentives Policies
That Achieve the Benchmark Reductions
Constant price
design 17 57 40 -7 11 122
Co s t-m in im iz ing
design 27 74 46 -7 15 155
Economic Incentives Policies
for Low- and Zero-Growth
Low-growth
Zero-growth
46
46
128
128
68
68
-7
-7
25
25
260
260
SOURCE: Derived as explained in the text.
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-44-
in all new medium-temperature retail food applications. Since CFC-502
is a combination of CFC-22 and CFC-115, substitution of CFC-502 for
CFC-12 leads to an increased demand for CHC1,. used to manufacture CFC-22.
The results of Table VI-5 are perhaps more meaningful when com-
pared with the future baseline precursor chemical requirements, assum-
ing no policy action is taken (Table VI-3). The percentage reductions
in precursor chemical requirements for CFC manufacture and for all
use under each of the policy designs over the baseline requirements
are given in Table VI-6.
The largest percentage reduction is shown for C^Cl, in both the
low-growth and zero-growth cases. If, in 1990, the same percent of
C?C1, goes toward CFC production as in 1977, then the reduction will
only affect 6 percent of total C~Cl, production. In fact, the only
precursor chemical for which total production would decline more than
6 percent over expected baseline levels is CCl,. Assuming 88 percent
of CCl, production is still devoted to CFC manufacture in 1990, total
CCl, production would decline about 15 percent over projected levels.
If FMC (as indicated in the footnote to Table G-l) indeed closed its
CCl, facility, the 1990 capacity requirement if either the low-growth
or the zero-growth policies were adopted would be about the same as
the current capacity available.
In 1976, aerosol applications of CFCs generated a significant
share of the market for each of the precursor chemicals except chloro-
form. This part of the precursor chemical market has now virtually
disappeared in the wake of the aerosol ban. It appears that the effects
of CFC nonaerosol regulation would be quite modest in comparison with
the effects of the aerosol ban. The largest impact of nonaerosol regu-
lations would occur in the CCl, market, where the reduction in total
The values for Table Vl-6 differ from those of Table A-6 of
Reference 8. Since this reference does not include baseline require-
ments for CFC-22 and CFC-114 production, only the values for CCl, and
CS~ agree with those presented here.
2
Since the assumption is that only 17 percent of C^Cl, went toward
CFC manufacture, only 6 percent reduction in C-C1, total production
would result.
-------
Table VI-6
PERCENT REDUCTION IN PRECURSOR CHEMICAL
REQUIREMENTS —1990
(millions of pounds)
Policy Design HF
Benchmark
Controls 5
Constant Price
Design 4
Cost -Minimizing
Design 6
Low-Growth 11
Zero-Growth 11
FOR CFC PRODUCTION
CC14 C2C14 CHC13 CS2 C12
11 14 -I
Economic
7 24 -1
10 28 -1
Economic
17 41 -1
17 41 -1
11 6
HF
2
Incentives Designs that Ac
The Benchmark Reduction
7 5
10 7
Incentives Designs
to Low Growth
16 12
16 12
2
3
FOR ALL USE3
CC1. C0C1, CHC10 CS0 C10
4/4 J / /
10 2 -1 3 1
hieve
i
6 4 -1 2 — b V1
7 5-1 31
Corresponding
5
5
15 7 -1 4 1
15 7 -1 4 1
SOURCE: Calculations explained in the text,
a.
Calculations assume that 46 percent of the HF, 88 percent of CC1,, 17 percent of C Cl 86 percent of
26 percent of CS?, and 9 percent of C12 are used in CFC manufacture.
Less than 1 million pounds.
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annual production could be as high as 15 percent. For the other
precursor chemicals, the effects of nonaerosol CFG regulation would
generally amount to less than a 7 percent reduction in the overall
markets.
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VII. CONCLUSIONS
The aerosol ban has had a significant effect on the CFG and
precursor chemical producing industries. Production of CFC-22 and
CFC-113, both of which were not widely used in aerosol products,
has steadily increased. In the absence of policy action between now
and 1990, growth for the two CFCs will continue. Alternatively,
production of CFC-11, CFC-12, and CFC-114, all of which were used
as propellants, will not again reach 1976 levels until about 1990.
In the absence of any policy action, we anticipate continued
growth in CHC1-, C Cl,, HF, and production of CC1, and CS_ to have
been adversely affected by the aerosol ban. Comparison of the values
of Tables VI-3 and III-4 indeed indicates continuing growth for CHC1~,
C2C1^, HF, and Cl , while production of CC1, and CS2 will not reach
1976 levels again until about 1990. Of the two precursor chemicals,
CC1, was affected more severely by the aerosol ban. This follows from
the fact that almost all of the CC1, produced is used in CFC manu-
facture, whereas only about one-fourth of the CS« production is devoted
to this use.
The effects of two general policy strategies for limiting non-
aerosol CFC emissions on precursor chemical production were examined.
One of these, a mandatory control strategy, requires firms to reduce
emissions by the use of specific technology. The second strategy,
economic incentives, involves manipulation of CFC prices so that it
becomes desirable to limit emissions. CFC emissions reductions that
would occur under five policy designs were used to determine the cor-
responding reductions in precursor chemical production requirements.
The first design, the benchmark controls, is a mandatory control
strategy; the other four designs are economic incentive strategies.
The five policy designs would lead to CFC emission reductions of be-
tween 15 and 30 percent over the period 1980 to 1990.
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The aerosol ban that primarily affected use of CFC-11 and
CFC-12 reduced the production requirements of those precursor chem-
icals used exclusively in their manufacture, CC1, and CS_. The five
policy designs for limiting nonaerosol emissions would lead to reduc-
tions in the use of CFC-113 in addition to CFC-11 and CFC-12. Pro-
duction requirements of several precursor chemicals—HF, CC1, , C_C1,,
CS,,, and Cl«—would also decline. The most stringent policy designs
for limiting emissions are the zero-growth and low-growth policies.
Under these policies, 1990 CC1, production would be about 15 percent
less than under base case projections which assume no policy action
will be taken. Production of the other precursor chemicals would
decline by 7 percent at most under the two policy designs. That the
greatest impact would be felt in the CC1, market is not surprising.
A very large amount of the total CC1, produced, 88 percent, is used
in the manufacture of CFCs. The very modest impact on the other pre-
cursor chemicals is also to be expected since much smaller percentages
of total production are devoted to CFC manufacture.
The techniques developed in this document have wide applicability.
They can be used to assess the effects of any level of CFC emissions
reduction on the precursor chemical production industries. An emis-
sions limitation imposed on a particular CFC implies a corresponding
limitation on its use. Reduced use leads to a reduction in CFC pro-
duction which, in turn, leads to a reduction in precursor chemical
requirements. This work provides the basis for translating a change
in any one of the three variables, CFC use, CFC production, and pre-
cursor chemical production into a change in any one of the other
variables.
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-49-
Appendix A
PRECURSOR CHEMICALS FOR CFG PRODUCTION
The purpose of this appendix is to develop factors that can be
used to calculate the amount of each precursor chemical used in CFC
manufacture. Given a level of CFC production and a knowledge of the
chemical equations and efficiency of the processes, this can be
accomplished readily. The molecular weights of each compound neces-
sary for the calculation are listed in Table A-l. For convenience,
Table A-2 reproduces the chemical equations presented in Section II.
Table A-l
MOLECULAR FORMULAS AND WEIGHTS
Compound Name
carbon disulfide
carbon tetrachloride
CFC-11
CFC-12
CFC-22
CFC-113
CFC-114
chlorine
chloroform
hydrogen fluoride
hydrochloric acid
methyl alcohol
perchloroethylene
trichloroethylene
Molecular Formula
cs2
cci4
CC13F
CC12F2
CHC1F2
C2C13F3
C2C12F4
C12
CHC13
HF
HC1
CH3OH
C2C14
C2HC13
Molecular Weight
76.14
153.84
137.38
120.93
86.48
187.39
170.94
70.91
119.39
20.01
36.47
32.04
165.85
131.39
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-50-
Table A-2
CHEMICAL EQUATIONS FOR CFC MANUFACTURE
HF ->- HC1 H
J
(CFC-11) (A-l)
CC14 + 2HF -> 2HC1
(CFC-12) (A-2)
a C H, + (7a-2b)Cl2 -»• (a-2b)CC!4 + (a+b)C2Cl4 + 6a HC1 (A-3)
2C12 -> CC14 + 2S (A-A)
CH. + 4C1,-. -* CC1, + 4HC1 (A-5)
4 i. 4
CHC13 + 2HF -»- 2HC1 + CHC1F2
(CFC-22) (A-6)
3C12 -> CHC13 + 3HC1 (A-7)
CH3OH + 2C12 -> CHC13 + HC1 + H20 (A-8)
3HF + C12 -> C2C13F3 + 3HC1
(CFC-113) (A-9)
4HF + C12 -»• C2C12F4 + 4HC1
(CFC-114) (A-10)
7C12 ->• C2HC13 + C2C14 + 7HC1 (A-ll)
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In addition to molecular weights, the calculations require knowl-
edge of emissions and production process efficiencies. Generally,
industry defines "process efficiency" as the product of an efficiency
factor and an emissions factor. In this work, the efficiency factor
will be considered to account for unreacted chemical inputs or un-
desirable byproducts, while the emissions factor will be assumed to
address mechanical losses after reaction of raw materials.
CFC emissions from the production process have been estimated by
knowledgeable sources at 2 percent of total production. Since it is
not known how this value varies depending on the CFC being produced,
the 2 percent loss figure will be adopted here for all CFC manufac-
turing processes. Emissions in the production of the intermediate
precursor chemicals are negligible according to industry sources.
This is probably due to the stringent emissions standards for the
chlorocarbons and also their much lower vapor pressures.
The second factor, the process efficiency, does vary somewhat
according to the chemical being produced. Through conversations with
industry individuals, we have made estimates of the magnitudes of
these factors for each process. These are explained in the develop-
ment of the factors for each precursor chemical below.
The general formula for calculating the precursor chemical
factors is as follows:
„ _ Precursor Molecular Weight
CFC Molecular Weight
X
Efficiency A (1-fraction Emitted)
INTEEMEDIATE PRECURSOR CHEMICALS
Equations A-l and A-2 may be used to determine the amount of
CC1, needed to produce one unit each of CFC-11 and CFC-12. The
These emissions are discussed in more detail in Section IV.
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-52-
losses here are primarily due to CFC production emissions. The
efficiency of producing CFC-11 and CFC-12 from CC1, is extremely high,
For CFC 11. 153.84 x
For CFC-11.
137_38 >999
For CFC-12: x __ x __ = ^30
HF
Equations A-l, A-2, A-6, A-9, and A-10 may be used to calculate
the amount of HF necessary per unit of CFC output. The efficiency of
producing CFC-11 and CFC-12 from HF is significantly higher than that
for producing CFC-22, CFC-113, and CFC-114.
F°r CFC-11: x
rorCFC.12:
_
For HCFC-22: • x - x -_ , 0.48
ForCFC.113;
_
x __ . 0.49
In this case, only Equation A-6 is needed. The production of
CFC-22 from CHC1 is extremely efficient, but to account for pro-
duction of CFC-23, a minor co-product, a value of .97 has been used.
-------
-53-
ForCFC-22:
C2C14
Equations A-9 and A-10 are necessary. Production of CFC-113 and
CFC-114 is not as efficient as the production of CFC-11 and CFC-121
ForCFC-113:
For CFC-114:
C12
Equations A-9 and A-10 are again those which are needed. The
consumption of Cl in the manufacture of CFC-113 and CFC-114 is
relatively inefficient.
For CFC-113: , ';L x ~^r x —^ = 0.42
For CFC-114: x -- x - = 0.46
PRELIMINARY PRECURSOR CHEMICALS
The relevant equation is Equation A-4 . As indicated previously,
the emissions of CCl, are negligible.
For CC14: >< X = °'52
-------
-54-
The necessary equations In this case are A-3, A-4, A-5, A-7,
A-8, and A-ll. Again, in each case, chlorocarbon emissions during
the production process are considered negligible.
For CHC1
•3 x 70 QI 1 I
in Equation A-7: - * -^ x _L = 1.94
For CHC1
in Equation A-8:
For CCl,
q,
in Equation A-4: 91 x x = 0.97
For CC14
in Equation A-5:
The Cl factors for CCl, and C^Cl, in Equation A-3 are more
complicated to derive because of a and b. One way to determine
values for these constants is to examine actual production for a
given year. In 1973, 1047 and 706 million pounds of CCl, and C Cl,
were produced respectively. Reference 1 states that 39 percent of
CCl, capacity is based on Equation A-3. Reference 2 asserts that
34 percent of C.C1, production is based on a process similar to
1
Equation A-3. It is a generally accepted fact that the inputs to
Equation A-3 can be continuously varied to provide different propor-
tions of C.Cl, and CCl,.
24 4
See Appendix B for a more complete discussion.
-------
-55-
On this basis, values for a and b can be derived in the follow-
ing way:
For CC14 produced in 1973: 1047 x 0.39 = 408
For C2C14 produced in 1973: 706 x Q.34 = 240
408 240
(a - 2b) 153.84 (a + b) 165.85
b = -0.22a
If a is assumed equal to 1, then b is -0.22 and Equation A-3 becomes:
4- 7.44 C12 + 0.78 C2C14 + 1.44 CCl^ + 6HC1
Of the 7.44 moles of Cl required to produce C Cl, and CC1, in
this equation, 63 and 37 percent were used to produce CC1, and C Cl,
respectively. Thus, the factors for Cl_ in this equation become:
For CC1,
7 44 x 70 91 1 1
in Equation A-3: . 63 x _;__^. x _ x ^-^ = 1 . 63
For C Cl,
2 * 0^ 7.44 x 70.91 1 v 1 _ . ,.
in Equation A-3: .37 x >78 x 165.85 792" ITOO ~
One industry source recommends that the input hydrocarbon in
this equation be treated as CH2 and multiple units of CH2. The fac-
tors resulting from this analysis do not differ significantly from
those shown above.
The Cl factor for C Cl, in Equation A-ll is also more difficult
to obtain because C Cl and C2HC13 are co-produced. Reference 2
states that about 90 percent of the C2CHl3 and 63 percent of the
-------
-56-
are manufactured using a method similar to Equation A-ll. For 1973,
Reference 3 gives total C.HCl. and C_C1, production as 452 and 706
pounds respectively.
On this basis, Equation A-ll was used to manufacture 407 and 445
million pounds of C^HCl and C2C14 respectively. This implies that
54 and 46 percent of the Cl. in Equation A-ll went toward C HCl,, and
X— £., -J
CC1, manufacture respectively. Thus, the Cl factor becomes:
For C2C14
in Equation A-ll: .46 x \ * ^'^ x _|_ x _i_ = 0.36
BYPRODUCT HCl
HCl is produced as a byproduct as a result of CFC manufacture
according to Equations A-l, A-2, A-6, A-9, and A-10. It is also pro-
duced in the preparation of the chlorocarbons for CFC manufacture in
Equations A-3, A-5, A-7, and A-8. Factors for each of these equa-
tions are developed below. The efficiency of the HCl recovery pro-
cess has been assumed to be 0.95 except in the case of CHC1« where
it is estimated at 0.90.
From CFC-11: —„ ' n x .95 x —— =0.26
x 36 47 1
From CFC-12: T * '95 X T98 ' °'58
2 x 36 47 1
From CFC-22: Q, . ' x .95 x -±- = 0.82
ob.4o . yo
From CFC-113: -\'^1- x -95 x _L = 0.57
The HCl byproduct from Equation A-ll is not included here.
See Section II,
-------
-57-
From CFC-114: 4 ** x.95 x -L- = 0.83
From CC1,
in Equation A-3 : .63 x * 6.47
_ ___
From CC1,
in Equation A-5: ±±- x .95 x = 0.90
From CHC1
in Equation A-7 : 3 * -90 x = Q.82
From CHC1
in Equation A-8: ' x .90 x - = 0.27
From C-Cl,
in Equation A-3: .37 x x .95 x = 0.59
Table A-3 summarizes the intermediate precursor chemical factors
derived above. The preliminary precursor chemical factors are given
in Table A-4. Finally, a summary of the factors for byproduct HC1
is provided in Table A-5.
These factors have been determined on the basis of the production
of one unit of product. It is a simple matter to multiply each factor
by the production of each chemical in a given year to obtain the total
amount of the precursor chemical which was used in the manufacture of
each CFC or intermediate precursor chemical that year. Comparison
of the factors determined for CC1,, HF, CHC1,, and C»C1, with those
provided by two of the CFC manufacturers shows good agreement.
-------
-58-
Table A-3
INTERMEDIATE PRECURSOR CHEMICAL FACTORS
(units of Precursor/Unit of CFG)
CFC Produced CC14
CFC-11 1 . 14
CFC-12 1.30
CFC-22
CFC-113
CFC-114
HF
0.15
0.34
0.48
0.34
0.49
CHC13 C2C14 C12
—
—
1.45
0.92 0.42
1.01 0.46
Table A-4
PRELIMINARY PRECURSOR CHEMICAL FACTORS
(units of Preliminary Precursor/
unit of Intermediate Precursor)
Intermediate ,, -
Precursor Produced 2 2
CC14 0.52 1.45a
CHC13 — 1.62b
C2C14 ~ 0.81°
Q
Calculated assuming 38, 39, and
23 percent of the CC14 for CFC produc-
tion was manufactured according to
Equations A-3, A-4, and A-5 respectively.
Half the CHCl- was produced accord-
ing to Equation A-7, and half according
to Equation A-8.
Q
Calculated assuming 35 percent of
the C_C1, used in CFC manufacture was
produced according to Equation A-3, and
65 percent according to A-ll.
-------
-59-
Table A-5
BYPRODUCT HC1 FACTORS
(Units of HCl/Unit of Chemical Produced)
Chemical Produced
CFC-11
CFC-22
CFC-22
CFC-113
CFC-114
cci4
CHC13
C2C14
HC1
0.26
0.58
0.82
0.57
0.83
0.43a
0.55b
0.21°
Q
Calculated assuming 38 percent of the
HC1 was produced according to Equation A-3
and 23 percent according to Equation A-5.
Calculated assuming half the HCl was
produced according to Equation A-7 and half
according to Equation A-8.
Q
Calculated assuming 35 percent of the
HCl was produced according to Equation A-3.
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-60-
Appendix B
HISTORICAL PRECURSOR CHEMICAL PRODUCTION
The purpose of this appendix is to establish the amount of each
precursor chemical used in CFG manufacture during the period 1970-1977
INTERMEDIATE PRECURSOR CHEMICALS
The intermediate precursor chemicals that would be greatly af-
fected by a change in CFG production were identified as CGI, , HF,
CHC1 , and C Cl , . Cl_ would also be affected, although to a lesser
extent. Each of these precursor chemicals is treated individually
below.
Table B-l shows total historical CCl^ production and the amount
that went toward CFC-11 and CFC-12 manufacture, derived using the
factors of Appendix A. Reference 1 states that in 1973, 97.2 percent
of CC14 went toward the production of CFC-11 (36.6 percent) and CFC-12
(60.6 percent). Table B-l shows excellent agreement, indicating that
97 percent of the 1973 CC1, production was used in CFC manufacture:
36 percent for CFC-11, and 61 percent for CFC-12.
Table B-l
CC1. PRODUCTION FOR CFCs— 1970-1977
4
(millions of pounds)
Year
1970
1971
1972
1973
1974
1975
1976
1977
Total3
1011
1009
997
1047
1163
906
857
809
For CFC-llb
278
294
342
381
389
308
292
243
For CFC-12b
488
507
571
636
633
511
511
465
Percent CC1, Used
For CFC Production
76
79
92
97
88
90
94
88
o
From Reference 3.
Calculated using the factors 1.14 and 1.30 for CFC-11 and CFC-12
respectively, given in Appendix A, and the production values of Table
III-l.
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-61-
HF
The historical HF production and the portion going toward CFC
manufacture are shown in Table B-2.
Values for total HF production for each year are not available.
Reference 4 does state that, in 1973, 305 million pounds or 41.6 per-
cent of total HF production went toward CFC production. This implies
a 1973 total production of 733 million pounds. Assuming this value
for total 1973 HF production, the estimates from Table B-2 imply that
44 percent of HF production was devoted to CFC manufacture, fairly
close to Reference 4's 41.6 percent.
Reference 5 gives 1974 total HF production as 799 million pounds.
On this basis, CFC manufacture accounted for 41 percent of total HF
production.
The values for 1973 in Table B-2 also agree fairly well with
Reference 4 which states that 55, 180, and 70 million pounds of HF
went toward CFC-11, CFC-12, and CFC-22 production, respectively.
Table B-?
HF PRODUCTION FOR CFCs—1970-1977
(millions of pounds)
Year
1970
1971
1972
1973
1974
1975
1976
1977
Fora
CFC-11
37
39
45
50
51
41
38
32
For
CFC-12
128
133
149
166
166
134
134
122
For
CFC-22
48
54
59
65
68
63
82
8<6
Forc
CFC-113
15
15
17
23
24
22
24
29
ForC
CFC-114
17
19
21
21
22
19
18
12
Total for
CFC Production
245
260
291
325
331
279
296
281
Calculated using the factors 0.15 for CFC-11 and 0.48 for
CFC-12 given in Appendix A, and the production values of Table III-l.
Calculated using the factor 0.48 for CFC-22 given in Appendix
A, and the production values of Table III-2.
Calculated using the factors 0.34 for CFC-113 and 0.49 for
CFC-114 given in Appendix A, and the production values of Table III-3,
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CHC13
Table B-3 shows total historical CHC1 production and the por-
tion that was used to manufacture CFC-22, determined using the
factor derived in Appendix A.
The 1973 value of Table B-3 agrees fairly well with Reference
4 which gives the amount of CHC1 going toward CFC-22 production as
205 million pounds or 81 percent of total CHCL, production.
Table B-3
CHC1 PRODUCTION FOR CFCs—1970-1977
(millions of pounds)
Year
Total
For CFC-22
Percent Used
For CFC-22
Production
1970
1971
1972
1973
1974
1975
1976
1977
240
231
235
253
302
262
292
302
145
162
178
197
204
191
247
260
60
70
76
78
68
73
85
86
From Reference 3.
Calculated using the factor 1.45 for
CFC-22 from Appendix A, and the production
values of Table III-2.
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-63-
Historical production of C Cl, and the amounts that were used
1
to manufacture CFC-113 and CFC-114 are given in Table B-4.
Reference 4 states that of the total 1973 C-Cl, production of
706 million pounds, 58 million pounds went toward the manufacture
of CFCs. Table B-4 indicates almost twice that amount. It is pos-
sible that Reference 1 was referring only to C-Cl, for CFC-113.
Table B-4
PRODUCTION FOR CFCs—1970-1977
(millions of pounds)
Year
Total'
For CFC-113
For CFC-114
Percent Used
For CFG
Production
1970
1971
1972
1973
1974
1975
1976
1977
707
705
734
706
734
679
669
603
40
40
47
63
66
60
66
77
35
39
43
43
44
39
37
25
11
11
12
15
15
15
15
17
Historical production was taken from Reference 3.
Calculated using the factors 0.92 for CFC-113 and 1.01 for
CFC-114 from Appendix A, and the production values of Table III-3,
A large portion of C2C1, is used as a solvent; in fact, it is
one of the potential substitutes for CFC-113.
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-64-
This compound is used as an intermediate precursor chemical
directly in the manufacture of CFC-113 and CFC-114. Table B-5 shows
historical production of Cl for the two CFCs.
Reference 4 gives total 1973 Cl_ production as 20,804 million
pounds, while Reference 5 states that in 1974, 21,236 million pounds
of Cl was produced. Thus, an almost negligible percent of the
total Cl? is used to produce CFC-113 and CFC-114. A much larger
portion of Cl? is used as a preliminary precursor chemical as
discussed below.
Table B-5
C12 PRODUCTION FOR CFCs—1970-1977
(millions of pounds)
Year
1970
1971
1972
1973
1974
1975
1976
1977
For CFC-113a
18
18
21
29
30
27
30
35
For CFC-114a
16
18
20
20
20
18
17
12
Total Used
For CFC
Production
34
36
41
49
50
45
47
47
a
Calculated using the factors 0.42 for CFC-113
and 0.46 for CFC-114 of Appendix A, and the pro-
duction values of Table III-3.
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-65-
PRELIMINARY PRECURSOR CHEMICALS
The significant preliminary precursor chemicals were identified
in Section II as CS and C10. They are used to make other chemicals
which, in turn, are used to produce CFCs. Both CS and Cl used in
this capacity are discussed below.
cs2
"CS is used to make CC1, which goes toward CFC-11 and CFC-12
manufacture. The calculation of the amounts of preliminary pre-
cursor chemicals used in CFC manufacture is not as straightforward
as that of the intermediate precursor chemicals. In general, the
only method for CFC preparation is one which uses the intermediate
precursor chemical, but the intermediate precursors are often pro-
duced from the preliminary precursor chemicals by several different
processes. For example, CC1, is produced using three different
methods, only one of which involves CS«.
According to Reference 1, about 38 percent of the CC1, capacity
uses the process described by Equation II-4. It will be assumed that
38 percent of CC1, is produced using CS« and further, that the same
percentage holds for the CC1, used in CFC-11 and CFC-12 manufacture.
On this basis, Table B-6 shows total historical CS? production
and the amount which went toward CFC manufacture. Reference 4 gives
1972 CS? production as 775 million pounds, and Reference 5 gives
1974 CS? production as 772 million pounds. From Table B-6, it can
be determined that CS« production for CFC manufacture represented
23 and 26 percent of total production for 1972 and 1974 respectively.
These values agree well with Reference 4 which states that 25 per-
cent of the CS,, was used to produce CFCs.
C12
In the discussion of intermediate precursor chemicals, the
amount of Cl_ which is used to produce CFC-113 and CFC-114 was
calculated. These are the only CFCs which directly employ Cl_ in
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-66-
Table B-6
CS- PRODUCTION FOR CCl^—1970-1977
(millions of pounds)
Year
1970
1971
1972
1973
1974
1975
1976
1977
For CCl4a
200
199
197
207
230
179
169
160
For CFC-lla
55
58
68
75
77
61
58
48
For CFC-12a
96
100
113
126
125
101
101
92
Total Used
For CFC
Production
151
158
181
201
202
162
159
140
a
Determined using the factor of 0.52 of Appendix A and the val-
ues of Table B-l and multiplying by 0,38.
their manufacture. Indirectly, however, Cl_ is necessary in the
preparation of some of the intermediate precursor chlorocarbons,
CHC13, CC14, and C2C14.
One knowledgeable source indicates the fraction of CHC1_ pro-
duced according to Equation II-9 is 50 percent or more. It will
be assumed here that half the CHCl, is manufactured using this pro-
cess. Table V-7 shows the amount of Cl which went toward CHCl,.
and, ultimately, CFC-22 manufacture.
See Equations 11-10 and 11-11.
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-67-
Table B-7
C12 PRODUCTION FOR CHC1.J—197 0-1977
(millions of pounds)
Year
1970
1971
1972
1973
1974
1975
1976
1977
For CHC13
388
373
380
409
488
423
472
488
For CFC-22a
234
262
287
318
329
308
399
420
ft
Calculated using an equal
weighting of the factors 1.94 and
1.29 and the values of Table B-3.
Table B-7 is in reasonable agreement with Reference 4 which
states that in 1973, 368 and 454 million pounds of Cl_ were used for
CFC-22 and CHC1, production, respectively, Given total Cl- production
of 20,804 million pounds in 1973 (Reference 6) and 21,236 million
pounds in 1974 (Reference 5), only about 2 percent of Cl_ was used
in CFC-22 manufacture.
CCl, can be prepared by three methods described by Equations
II-3, II-4, and II-5. According to Reference 7, about 23 percent
of the CCl, capacity is available to produce CCl^ by Equation II-5,
38 percent by Equation II-4, and 39 percent by Equation II-3. It
will be assumed that the percentage capacity devoted to each process
is the same as the percentage actually used in CCl, production. With
this in mind, Table B-8 shows the amount of Cl- which was used his-
torically to produce CCl, by the three methods, and finally, to
produce CFC-11 and CFC-12.
Reference 4 gives the amount of Cl? which went toward CFC-11
and CFC-12 production in 1973 as 640 and 970 million pounds, respec-
tively. The values of Table B-8 for 1973 are somewhat lower than
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Table B-8
C12 PRODUCTION FOR CC14—1970-1977
(millions of pounds)
Year
1970
1971
1972
1973
1974
1975
1976
1977
For CCl4a
1462
1459
1442
1514
1682
1310
1239
1170
For CFC-lla
402
425
495
551
562
445
422
351
For CFC-12a
706
733
826
920
915
739
739
672
Total Used
For CFC
Production
1108
1158
1321
1471
1477
1184
1161
1023
Determined using a weighting of 38 percent of the factor 1.63,
39 percent of the factor 0.97, and 23 percent of the factor 1.92 to-
gether with the values of Table B-l.
these numbers. From the total Cl_ production given in References 5
and 6, it can be determined that about 8 percent of Cl« is used to
manufacture CFC-11 and CFC-12.
Reference 1 disagrees somewhat with Table B-8 stating that 5.1
percent of Cl production went toward the manufacture of CCl, . A
quick calculation indicates that this would be the case if all CCl,
were produced using methane and Cl«. However, Reference 7, an
appendix to Reference 1, also gives the percentage breakdown of each
of the three methods for CCl, production used in this work. We do
not have an explanation for the discrepancy.
Cl is used to produce C_C1, according to Equations II-3 and
11-12. Reference 2 claims that 34 percent and 63 percent of the
C-C1, are produced according to Equations II-3 and II-2, respec-
1
tively. Table B-9 gives the amount of Cl,; required for C9C1, pro-
duction which then translates into CFC-113 and CFC-114 manufacture.
This reference also states that the remaining 3 percent of the
C?C1, is produced using acetylene (C9H~), but industry sources indi-
cate that this process is no longer used. We will assume here that
35 percent is manufactured according to Equation II-3 and 65 percent
according to Equation 11-12.
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-69-
The percent of total Cl used in the production of CFC-113 and
CFC-114 is very small, less than 1 percent. Reference 4 states that
the amounts of C12 used to make C Cl, and the CFCs in 1973 were 1062
and 88 million pounds respectively. Table B-9 gives a value for
CC1 about half of this, but agrees well for the CFCs.
Table B-9
C12 PRODUCTION FOR C2C14~1970-1977
(millions of pounds)
Year
1970
1971
1972
1973
1974
1975
1976
1977
For C2C1 a
571
570
593
570
593
549
541
487
For CFC-113a
32
32
38
51
53
48
53
62
For CFC-1143
28
32
35
35
36
32
30
20
Total Used
For CFC
Production
60
64
73
86
89
80
83
82
Determined using 35 percent of the factor 1.64 and 65 percent
of the factor 0.36 together with the values of Table B-4.
BYPRODUCT HC1
The HC1 produced in the manufacture of the CFCs is, as mentioned
previously, an important consideration. The market for the HC1 is
dynamic; at times, demand for the chemical is heavy; at other times,
neutralization or deepwelling must be used to dispose of it. Thus,
HCl conditions may have a significant economic impact on production.
Table B-10 presents the amount of HCl which was produced histor-
ically in the manufacture of each of the CFCs according to Equations
II-l, II-2, II-7, 11-10, and 11-11.
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-70-
Table B-10
HC1 PRODUCTION FROM CFCs—1970-1977
(millions of pounds)
From
Year CFC-11£
From From From From
CFC-12S CFC-22 CFC-113C CFC-114C Total
1970
1971
1972
1973
1974
1975
1976
1977
63
67
78
87
89
70
67
55
218
226
255
284
282
228
228
208
82
92
101
112
116
108
139
147
25
25
29
39
41
37
41
48
29
32
36
36
37
32
31
21
417
442
499
558
565
475
506
479
Determined using the factors of 0.26 for CFC-11 and 0,58 for
CFC-12 of Appendix A and the values of Table III-l.
Determined using the factor 0.82 for CFC-22 of Appendix A
and the values of Table III-2.
CDetermined using the factors 0.57 for CFC-113 and 0.83 for
CFC-114 of Appendix A and the values of Table III-3.
Table B-ll shows the amount of HC1 produced in CCl,, CHC13,
and C Cl, production for the manufacture of CFC-ll/CFC-12, CFC-22,
and CFC-113/CFC-114.
A summary of the amounts of each precursor chemical which
historically went toward CFC manufacture is provided in Section III,
Table III-4.
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-71-
Table B-ll
HC1 PRODUCTION FROM PRECURSOR CHEMICALS--1970-1977
(millions of pounds)
From CC1,
For
Year CFC-113
1970
1971
1972
1973
1974
1975
1976
1977
122
129
149
167
170
135
128
106
From CC1
For
CFC-12a
213
222
250
278
277
223
223
203
From CHC1-
For
CFC-22
79
88
97
107
111
104
135
142
From C7C1,
For
CFC-113C
8
8
10
13
14
12
14
16
From C Cl
For
CFC-1140
7
8
9
9
9
8
8
5
4
Total
429
455
515
574
581
482
508
472
'Determined using 39 percent of the factor 0.59 and 23 percent
of the factor 0.90 and the values of Table B-l.
Determined using 50 percent of the factor 0.82 and 50 percent
of the factor 0.27 and the values of Table B-3.
Q
Determined using the factors of Appendix A and Table B-4.
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-72-
Appendix C
HISTORICAL CFG APPORTIONMENT
The purpose of this appendix is to apply the method of allocating
CFC to its various destinations after it is produced to the period
1970-1977. We first discuss the activities before the CFC is used,
and then address aerosol use.
PRE-USE ACTIVITIES
Tables C-l through C-5 summarize historical production, inter-
mediate use, sales, emissions, exports, and nonaerosol use of the
five CFCs. For CFC-113, Table IV-4 presents values for only pro-
duction, sales, and nonaerosol use. A more detailed analysis of
this CFC is provided in Reference 3.
The values of Tables C-l and C-2 indicate that intermediate use
of CFC-11 and CFC-12 averaged about 5 percent of total production for
the historical period. Small quantities of both CFCs are used in-
house as refrigerants. Although there are no supporting data, they
may also be used consumptively as chemical intermediates.
For the same period, according to Table C-3, CFC-22 intermediate
use represented approximately 28 percent of production. This CFC is
used as one component of the refrigerant, CFC-502, and this would
account for part of the intermediate use. In 1976, approximately
10 million pounds of CFC-502 were sold as a refrigerant. About half
of this, or 5 million pounds, was CFC-22 and half was CFC-115. Some
CFC-22 is also converted to TFE which is used in the manufacture of
teflon. This apparently accounts for the balance of CFC-22 inter-
mediate use.
-------
Table Ol
CFC-11 APPORTIONMENT—1970-1977
(millions of pounds)
Year
1970
1971
1972
1973
1974
1975
1976
1977
Production
244
258
300
334
341
270
256
213
Intermediate
Use
7
21
14
5
20
16
17
16
Sales
237
237
286
329
321
254
239
197
Emissions
5
5
6
7
6
5
5
4
b
Exports
12
12
14
16
16
13
12
10
Available
For Use
220
220
266
306
299
236
222
183
u>
I
Emissions cited in the table are those resulting from storage, packaging, and transport
and do not include CFG emitted in the production process.
Assumed to be 5 percent of sales.
c
The figures in this column represent salss minus emissions minus exports. See Appendix
D for more detail.
-------
Table C-2
CFC-12 APPORTIONMENT--1970-1977
(millions of pounds)
Year
1970
1971
1972
1973
1974
1975
1976
1977
Production
375
390
439
489
487
393
393
358
Intermediate
Use
19
18
20
25
38
18
22
18
Sales
356
372
419
464
449
375
371
340
o
Emissions
7
7
8
9
9
8
7
7
Exports
18
19
21
23
22
19
19
17
Available
For Use0
331
346
390
432
418
348
345
316
Emissions cited in the table are those resulting from storage, packaging, and transport
and do not include CFG emitted in the production process.
Assumed to be 5 percent of sales.
The figures in this column represent sales minus emissions minus exports. See Appendix D
for more detail.
-------
Table C-3
CFC-22 APPORTIONMENT--1970-1977
(millions of pounds)
Year
1970
1971
1972
1973
1974
1975
1976
1977
Production
100
112
123
136
141
132
170
179
Intermediate
Use
27
32
43
39
29
38
44
50
Sales
73
80
80
97
112
94
126
129
0
Emissions
1
2
2
2
2
2
3
4
Exports
4
4
4
5
6
5
6
6
Available
For Use0
68
74
74
90
104
87
117
119
Emissions cited in the table are those resulting from storage, packaging, and transport
and do not include CFC emitted in the production process.
Assumed to be 5 percent of sales.
f*
The figures in this column represent sales minus emissions minus exports. See Appendix D
for more detail.
Ui
I
-------
Table C-4
CFC-113 APPORTIONMENT—1970-1977
(millions of pounds)
Year
1970
1971
1972
1973
1974
1975
1977
Production
43
44
51
68
72
72
84
Sales
41
42
49
65
69
69
80
Available
For Use3
41
42
49
65
69
69
80
The CFC-113 apportionment was accomplished
differently from other CFCs. The method is
described in Reference 8.
-------
Table C-5
CFC-114 APPORTIONMENT—1970-1977
(millions of pounds)
Year
1970
1971
1972
1973
1974
1975
1976
1977
Production
35
39
43
43
44
39
37
25
Intermediate
Use a
6
6
6
6
6
6
6
6
Sales
29
33
37
37
38
33
31
19
b
Emissions
1
1
1
1
1
1
1
0
c
Exports
1
2
2
2
2
2
2
1
Available,
For Use
27
30
34
34
35
30
28
18
Intermediate use for the historical period averaged about 6 million pounds per year.
Emissions cited in the table are those resulting from storage, packaging, and transport
and do not include CFC emitted in the production process.
Q
Assumed to be 5 percent of sales.
The figures in this column represent sales minus emissions minus exports. See Appendix; D
for more detail.
-vl
I
-------
-78-
For CFC-113, industry sources indicate that intermediate use is
negligible as indicated in Table C-4. For CFC-114, the values of
Table C-5 show that intermediate use averaged approximately 16 percent
of production for the period. Most of the CFC-114 used in this way is
converted to CFC-115, one component of CFC-502. As discussed before,
about 5 million pounds of CFC-115 were produced in 1976 for CFC-502.
The CFC-114 requirement was about 6 million pounds, which agrees exactly
with the 1976 value for CFC-114 intermediate use in Table C-5.
Emissions, as given in the tables, represent 2 percent of sales,
while exports represent 5 percent.
AEROSOL USE
References 1 and 4 claim that, in 1973, 237 million pounds of
CFC-11, 249 million pounds of CFC-12, and 25 million pounds of CFC-114
were used as propellants. Information provided by a knowledgeable
industry source indicates that, although the total amount of CFG used
in this way is in relatively good agreement with Reference 4, the mix
was quite different. According to these data, 1973 aerosol use ac-
counted for 170 million pounds of CFC-11, 265 million pounds of CFC-12,
and 45 million pounds of CFC-114.
Since the information of the industry source is more recent and
also more complete (values are given for 1973 through 1979), it will
be adopted here. Unfortunately, no data for 1970 to 1972 are avail-
able. Reference 4 states that the aerosol application accounted for
45 and 49 percent of total CFC use in 1968 and 1973 respectively.
The implication is that aerosol uses of the CFCs were slightly less
in 1970 than 1973 on a percentage basis.
Table C-6 lists the annual amount of CFC-11, CFC-12, and CFC-114
available for use and the amounts used in aerosols and nonaerosol
applications. The data in this table were derived in the following
manner:
1. The CFC available was taken from Tables C-l, C-2, and
C-5 of this work.
-------
-79-
2. The industry-supplied figures for CFC-11 and CFC-12
aerosol use were adopted for 1973 through 1977. This
source gives ranges for 1974 and 1975, and the mid-
points of these ranges are given in Table C-6.
3. For 1970, 1971, and 1972, it was assumed that 54 per-
cent of CFC-11, 60 percent of CFC-12, and 96 percent
of CFC-114 were used in aerosol applications.
4. Figures for nonaerosol end use are the difference
between the total amount of CFG available and the
amount used in aerosol applications.
Table C-6 illustrates a number of points. CFG used as a propel-
lant began declining in 1975, probably in anticipation of the propel-
laiit ban. In addition, the amount of the three CFCs available for use
(and thus their production and sales) has also declined. As was men-
tioned previously, this is not the case for CFC-22 and CFC-113, both
of which were not widely used as propellants.
Tables C-l through C-6 are summarized in Table IV-1 of Section IV
and compared with nonaerosol end use data from Reference 8.
-------
Table C-6
CFC AEROSOL AND NONAEROSOL END USE--1970-1977
(millions of pounds)
Year3
1970b
1971b
1972b
1973
1974
1975
1976
1977
Available
For Use
220
220
266
306
299
236
222
183
CFC-11
Aerosol
119
119
142
170
168
143
123
70
Non-
Aerosol
101
101
124
136
131
93
99
113
CFC-12
Available
For Use
331
346
390
432
418
348
345
316
Aerosol
199
207
232
265
235
186
156
91
Non-
Aerosol
132
139
158
167
183
162
189
225
CFC-114
Available
For Use
27
20
34
34
35
30
28
18
Aerosol
26
29
33C
33d
34e
29
26
14
Non-
Aerosol
1
lc
1C
1C
1C
1
2
4
00
o
Total CFC here does not include CFC-22 or CFC-113 since both are used exclusively in nonaerosol
applications.
The values for these three years are constructed numbers. See the text for more detail.
Q
Values do not represent the percentages indicated due to rounding errors.
The industry source reports that 45 million pounds of CFC-114 were used in aerosol applications
in 1973. It is unlikely, given the emissions, exports, captive, and in-house uses, that the amount
available for use could be as high as 45 million pounds. Reference 1 gives 1973 CFC-114 aerosol use
as 25 million pounds. It will be assumed here that 96 percent of the CFC-114 available for use was
used in aerosol applications in 1973.
The industry source reports that 39 to 40 million pounds of CFC-114 were used in aerosol appli-
cations in 1974. Since the total amount available for use is not that high, it will again be assumed
that 96 percent of the CFC-114 went toward aerosol applications.
-------
-81-
Appendix D
CALCULATING CFG NONAEROSOL END USE
This appendix describes a model for calculating the amount of
each CFG available for nonaerosol use based on production and/or
sales figures. Between the time the CFC is produced and the time
it is used, the CFC has various destinations. Each of these
destinations was discussed in detail in Section IV, and a summary
is given here.
1. Production Emissions
Emissions occur during the production process prior to the
reporting of production figures. The production figures
represent 98 percent of the CFC originally manufactured.
2. Storage, Packaging, and Transport Emissions
These emissions occur sometime between production and use
of the CFC. For convenience, they amount to 2 percent of
the reported sales figures.
3. Intermediate Use
This use of the CFC accounts for part of the difference
between reported production and sales figures, and its
magnitude varies among the CFCs. Since this use involves
converting the CFC to another chemical compound, emission
of the CFC itself is unlikely to occur.
4. In-House Use
This use, together with captive use, accounts for the
difference between the reported production and sales
figures. In-house use involves use of the CFC itself
by the producer. Some emissions may occur during this
use, but will be considered negligible.
-------
-82-
5. Market Inventories
Inventories may amount to 6 percent of each year's sales.
Since inventories in successive years frequently cancel
one another, they are not considered here.
6. Exports
CFC exports are assumed to be 5 percent of sales.
THE MODEL
The quantities for establishing the historical material balance
can be defined for a given year as follows:
M = the amount of CFC originally manufactured.
P = the reported CFC production.
PE = the quantity of CFC emitted during the production
process.
S = the reported CFC sales.
SPTE = the quantity of CFC emitted during storage,
packaging, and transport.
E = the amount of CFC exported.
CU = the quantity of CFC used as an intermediate.
IU = the quantity of CFC used in-house by the producers.
AU = the amount of CFC used in aerosol applications.
EU = the amount of CFC used in nonaerosol applications.
The relationships relating one variable to another are
as follows:
P = 0.98 M
PE = 0.02 M
P - S = CU + IU
SPTE = 0.02 S
E = 0.05 S
-------
-83-
The total amount of CFC available for end use in a particular
year is as follows:
EU = M - PE - SPTE - CU - IU - E - AU (C-l)
Since production figures for CFC are often available, this can be
rewritten:
EU = P - SPTE - CU - IU - E - AU
=0.93 (P - CU - IU) - AU (C-2)
If, alternatively, sales figures are given, the relationship is
simplified to:
EU = S - 0.07 S - AU
= 0.93 S - AU (C-3)
All of these relationships apply to CFC-11, CFC-12, CFC-22,
and CFC-114, but not to CFC-113. The material balance for CFC-113
was addressed in more detail in Reference 8.
AN EXAMPLE
As one sample application of the model, the production figures
of Table VI-2 can be used to determine the CFC available for end use.
For CFC-12, 1990 production is estimated at 365 million pounds.
Intermediate and in-house use of CFC-12 in 1976, the reference year,
were about 3 percent of production, and will be assumed to remain
at that level through 1990. Since propellant use has been banned,
AU is zero. Thus, using Equation C-3, the amount of CFC-12 available
for end use in 1990 is 327 million pounds which agrees with the end
use value in Table VI-2.
End use of CFC-11, CFC-22, and CFC-114 for 1990 can be deter-
mined in the same manner by using the 1976 level of intermediate
and in-house use. CFC-113 was treated somewhat differently and is
discussed in detail in Reference 8.
-------
-84-
The model is useful for estimating future production, sales,
or end use when one of the three variables is known. However, some
of the assumptions on which the model was based may not hold in the
future. For example, exports may not remain at 5 percent of sales,
or imports may increase. Nevertheless, the model does provide the
framework for calculating future production or end use by simply
varying the export level or including imports.
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-85-
Appendix E
ALLOCATION OF CAPACITY
The purpose of this appendix is to evaluate the applicability of a
technique for allocating capacity available for producing each CFC.
We first present historical total capacity estimates based on an
industry "rule of thumb." We then show a capacity allocation to
each CFC for 1977.
HISTORICAL TOTAL CAPACITY
We have been told by knowledgeable industry sources that plant
capacities historically remained approximately 15 percent ahead of
production requirements. Since production of the five CFCs represents
about 99 percent of total CFC production, the applicability of this
rule can easily be determined.
Total historical production, obtained by summing the values of
Tables III-l through III-3, is given in Table E-l with the implied
capacity according to the "rule of thumb" given above.
The 1977 implied capacity value agrees very well with the esti-
mated 1978 total capacity of 1060 million pounds given in Table V-l.
The historical trend in total production may also lend credence to
the difference in capacities specified by the two references in that
table. Reference 4's total capacity of 1195 million pounds would have
been adequate for the demand prior to 1973. Additional capacity was
obviously necessary to meet the increased production levels of 1973
and 1974. Reference 1's higher total capacity of 1435 million pounds
could reflect the fact that further capacity was added in this period.
The design capacity of a plant is often not a true indication of
the production capability. Frequently, with relatively modest capital
expenditures, a plant may have the capability to actually produce at
as much as 200 percent of design capacity. It should be kept in mind
that the use of design capacity for production allocation does have
limitations. The claim by industry that capacities have historically
remained 15 percent ahead of production may be a useful relationship
for the long-term situation; nevertheless, it is sometimes true that
short-term production can far exceed plant design capacity.
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-86-
Table E-l
CFG PRODUCTION AND CAPACITY—1970-1977
(millions of pounds)
Year Production Implied Capacity
1970 797 917
1971 843 969
1972 956 1099
1973 1070 1231
1974 1085 1248
1975 899 1034
1976 928 1067
1977 859 988
The decline in production which began in 1975 probably led to
the plant closings which are reflected in 1978 estimated total capac-
ity. In any case, the 15 percent rule of thumb provided by industry
sources seems to give a fairly good estimate of total capacity given
the total historical production data, and it is therefore useful for
predicting future capacity based on production projections.
It is necessary to have information detailing the plant capacity
of each producer by individual CFG in order to assess and possibly
separate the effects on the different firms of limitations of emissions
from the various end use areas. Unfortunately, no current data of this
type exist. However, some of the references do provide information
that can be used to allocate the current industry capacity for each
CFC to a particular firm.
Plants designed to produce CFG-113/CFC-114 are not presently used
to produce the three other CFCs. However, since these plants have the
most stringent construction requirements, they could, with some invest-
ment, be converted to CFC-ll/CFC-12 or CFC-22 production. The opposite,
however, does not obtain. CFC-ll/CFC-12 and CFC-22 plants are con-
structed for less stringent processing conditions and, therefore, they
cannot, without virtually being rebuilt, be converted to produce CFC-113/
Some storage facilities, however, can be used interchangeably for
CFC-ll/CFC-12 and CFC-113/CFC-114.
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-87-
CFC-114. Thus, it seems reasonable to assume that currently existing
plants either produce CFC-113/CFC-114 or the other three CFCs.
Reference 1 indicates that DuPont's one remaining CFC-113/CFC-114
plant has 100 million pounds of capacity. This reference also assigns
100 million pounds to one of Alliedfs locations where all five CFCs
are produced. This is the only Allied facility which presently pro-
duces CFC-113/CFC-114. According to industry sources, Allied's esti-
mated CFC-113/CFC-114 capacity is about 50 million pounds. Total 1977
CFC-113 and CFC-114 production was 109 million pounds, which, using
the "rule of thumb," would imply a combined capacity of 125 million
pounds for the two producers. This does not differ drastically from
the industry source estimate of 150 million pounds. The current 1978
estimate of total CFC-113/CFC-114 capacity by industry sources will
be adopted here, leaving 910 million pounds of capacity for CFC-11/
CFC-12 and CFC-22.
It is difficult to separate CFC-ll/CFC-12 from CFC-22 capacity.
Some plants were designed as "campaign plants." Such plants are
capable of producing either CFC-ll/CFC-12 or CFC-22 simply by varying
the feed. Thus, design capacity itself is not meaningful in this case.
What is meaningful is the portion of design capacity which was used
annually to produce CFC-22.
It will be assumed that the 910 million pounds of capacity re-
maining after CFC-113/"CFC-114 capacity has been taken into account
can be allocated according to the relative amounts of CFC-11, CFC-12,
and CFC-22 produced in 1977. It will also be assumed that the 150
million pounds of CFC-113/CFC-114 capacity can be apportioned accord-
ing to the relative 1977 production of each. Table E-2 shows the
results of this allocation scheme.
Total 1977 CFC-22 production was 179 million pounds. Using the
15 percent rule of thumb, this latter value implies a capacity of about
Although apportioning individual CFG capacities to plants pro-
ducing more than one CFC is not strictly correct, it does provide a
rough idea of capacity share devoted to each.
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-88-
Table E-2
1977 CFC CAPACITY
(millions of pounds)
CFC
CFC-11
CFC-12
CFC-22
CFC-113
CFC-114
TOTAL
Annual
Capacity
259
434
217
115
35
1060
Percent
of Total
24
41
21
11
3
100
205 million pounds for CFC-22, which agrees well with the value of
Table E-2. Actual 1977 combined production of CFC-11 and CFC-12 was
571 million pounds. Again, using the "rule of thumb," this would
imply a capacity of about 660 million pounds which, again, agrees
fairly well with the amount estimated in Table E-2.
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-89-
Appendrbc F
CFC SALES ESTIMATES
The estimates of Table V-6 understate CFC sales for Racon in
particular and probably for the other producers as well.
The factor that is probably most responsible for the under-
statement of the sales is intermediate CFC use. The figures for the
sales value of CFC-11, CFC-12, and CFC-22 given in Reference 3 do not
include sales of CFC used as an intermediate. For example, much of
the CFC-22 that is produced is used as an intermediate in a process
for manufacturing teflon which is marketed by DuPont. Clearly, part
of the sales of teflon is attributable to CFC-22. The same applies to
CFC-11, CFC-12, and CFC-114 which are also used to a lesser extent as
intermediates.
Perhaps a more accurate estimate of sales allocation to each
firm could be made by assuming that all the CFC that is produced is
sold at the average unit selling price for each CFC. Apportionment
could still be accomplished on the basis of portion of capacity held
but would include all the CFC that is produced.
Table F-l presents the 1977 CFC sales allocation .by firm based
upon the production of each CFC .
Table F-l
1977 CFC SALES FROM PRODUCTION FIGURES
(millions of dollars)
Producer
Allied
DuPont
Kaiser
Pennwalt
Racon
CFC-11
15.9
41.2
6.5
7.2
1.5
CFC-12
30.1
80.1
12.9
14.3
5.7
CFC-22
24.5
63.6
9.8
11.0
13.4
CFC-113
15.0
30.4
CFC-114
5.4
10.9
Total
90.9
226.2
29.2
32.5
20.6
TOTAL 72.3 143.1 122.3 45.4 16.3 399.4
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-90-
Comparing the total sales in Table F-l with that of Table V-5
shows that the allocation scheme based on production increases the
total sales by about 15 percent. In addition, Racon's sales, given
in Table F-l, are higher and thus closer to the actual sales of
$29.7 million. In fact, the sales of all firms are higher in Table
F-l than they are in Table V-5.
Racon's sales are still too low, probably for a number of reasons.
First, the sales allocation scheme, whether based on the amount of CFC
produced or the amount sold, assumes that sales is proportional to the
fraction of total industry capacity held by a particular firm. Racon
may run its plants at higher capacity and therefore be responsible for
a larger percentage of total sales. For this to be true, however, it
is required that one or more of the other producers' sales be less
than that indicated in Table F-l. That is, if Racon's sales share is
higher, since the total sales is constant, sales of the other pro-
ducers must be lower. To illustrate the sensitivity of the allocation
scheme, we note that if Racon actually sells 15 percent of the CFC-22
rather than 11 percent as indicated by the capacity apportionment,
then Racon's total sales in Table F-l would increase to $25.6 million
which is much closer to Racon's actual sales. If Racon's share of
CFC-11 and CFC-12 sales were also increased slightly, it is easy to
see how the actual sales of the firm could be realized.
Another factor that may contribute to the low estimate of Racon's
sales is sales of azeotropes. Racon markets two azeotropes, CFC-500
2
and CFC-502, which are sold as refrigerants. The price of CFC-502
is nearly three times that of CFC-12. On this basis, if only a few
million pounds of Racon's CFC-22 were sold as one component of the
azeotrope R-502 instead of in the pure form, Racon's CFC sales would
be much larger. Since azeotrope formulation is accomplished with CFC
used as an intermediate, this same factor may also contribute to
understatement of the other producers' sales.
Azeotropes are combinations of two or more chemicals.
2
CFC-500 consists of 74 percent CFC-12 and 26 percent CFC-152a
by weight.
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-91-
Probably the most important reason for Racon's low sales esti-
mate involves prices. The sales value of Reference 3 for CFC-11,
CFC-12, and CFC-22 is a total industry value. This number divided
by the amount sold gives an average industry selling price but does
not necessarily reflect the average selling price for a particular
firm. Racon may have sold less of these CFCs in large quantities
and more in smaller quantities with higher prices. To emphasize the
possible variations in price, a 1978 price list for CFC-11, according
to packaging for refrigeration, is given in Table F-2.
The values of this table indicate that price is highly influenced
by the type of packaging and the total amount delivered. CFC-11 is
also used in the foam-blowing industry, and it is likely that a price
list of CFC-11 for this application would differ significantly from
that shown in Table F-2.
Table F-2
1978 PRICE LIST—CFC-11
(cents per pound delivered)
Container Price
Bulk 40
One Ton Cylinder 52
650 Pound Drum 50
200 Pound Drum 54
100 Pound Drum 61
30 Pound Pressurized Cylinder 80
In deriving the values of Table V-6, a unit value of about 34
cents per pound was used for CFC-11 in 1977. This price is lower
than any of the prices in Table F-2, which could indicate a price
increase occurred from 1977 to 1978. Nevertheless, the table serves
to emphasize that there is a large variation in the prices at which
the CFC is sold and that caution must be exercised when using the
numerous quoted prices.
This unit value is calculated by dividing CFC sales value by
quantity sold.
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-92-
The final factor which may contribute to sales underestimates
involves the CFC-113 and CFC-114 prices. Eacon purchases these two
CFCs from their producers and sells them as refrigerants. Racon's
purchase is probably at bulk price and the subsequent sales are likely
in smaller packages at higher prices. These sales also have not been
included in Racon's calculated sales in Table V-6.
Because we know that 100 percent of Racon's sales derives from
sales of CFCs, we know that Table V-6 underestimates Racon's sales.
Some of the factors presented here provide possible reasons for the
low estimates. The fact that intermediate use of the CFCs is not
included in the sales values of Table V-6 implies that sales for all
producers are probably understated.
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-93-
Appendix G
PRECURSOR CHEMICAL PRODUCERS
In this appendix, we identify the producers of the precursor
chemicals, and apportion precursor chemical production to each pro
ducer based on capacity. Each precursor chemical identified in
Section II as being highly dependent on CFG manufacture is treated
in turn.
As Appendix B indicates, almost all of the CCl, which was pro-
duced historically has been used in CFG manufacture. Limitation of
CFC-11 and CFC-12 production would cause all CCl, manufacturers to
suffer.
Reference 1 gives the 1976 annual capacity of CCl, as 1325 mil-
lion pounds, while recent industry estimates indicate a lower value
of 1205 million pounds. The 1977 production of CCl, for CFCs totaled
708 million pounds, 243 and 465 million pounds of which went toward
CFC-11 and CFC-12 manufacture, respectively. Table G-l shows the
CCl, producers and their capacities from recent industry estimates.
The 1977 production of CCl, by each firm for CFC-11 and CFC-12
is also given in the table. Allocation of the production was based
on a number of assumptions. First, for DuPont, the only CFC pro-
ducer listed, it was assumed that CCl, production was equal to the
amount needed for its own CFC-11 and CFC-12 manufacture. Vulcan
materials is the precursor chemical supplier for Racon, and CCl,
production was assumed sufficient for Racon's CFC manufacturing needs.
Production allocation to the other two firms, Dow and Stauffer, was
accomplished on the basis of the relative capacity share held.
It should be mentioned here that CCl, "capacity" is somewhat
misleading since much of this chemical is manufactured with the co-
product C_C1,. Thus, in a sense, some portions of CCl, and C^Cl,
capacity are interchangeable.
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-94-
Table G-l
CCl, PLANT CAPACITY--1977
(millions of pounds)
Producer
Dow Chemical
DuPont
FMC3
Stauffer Chemical
Vulcan Materials
TOTAL
Annual
290
300
280
225
110
1205
Capacity
(24)
(25)
(23)
(19)
(9)
(100)
1977 CC14
For CFC-11
26
139
53
20
5
243
Production
For CFC-12
50
260
98
38
19
465
Q
Joint venture with Allied which apparently shut down in mid-1979.
According to Table III-5, 88 percent of the CCl, manufactured
in 1977 was used for CFG production. The total amount of CCl, pro-
duced that year was 809 million pounds. Using the same 15 percent
rule of thumb as applied to CFG capacity implies a 1977 CCl, annual
1 ^
capacity of about 930 million pounds. This is smaller than the
total 1977 capacity indicated in Table G-l. In 1974, CCl, production
was 1163 million pounds, which leads to a required capacity of about
1340 million pounds. This value agrees well with the total capacity
of Reference 1, but is higher than the industry estimates of Table
G-l. It may be that some plants have been closed since CCl, pro-
duction peaked in 1974 or it may be that C_C1, capacity has been
included in these estimates. Nevertheless, current CCl, capacity is
apparently underutilized.
One very interesting point concerning CCl, is the extremely
large difference between the production and sales reported in Ref-
erence 3. The 1976 total CCl, production was 857 million pounds
If FMC did, indeed, close its plant in mid-1979, the total
annual CCl^ capacity would be 925 million pounds, which agrees well
with the implied capacity for current production.
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-95-
while the sales total was only 459 million pounds, which indicates
a captive use of 398 million pounds, 46 percent of the amount pro-
duced. Since most CC1, is used to manufacture the CFCs, it might
be expected that the CC1, is used captively by the producers them-
selves for this purpose.
According to Table G-l, DuPont and Allied (with FMC) are the
only CFC producers who also manufacture CC1,. Although Vulcan
Materials is the precursor chemical supplier for Racon, its produc-
tion would probably be reported in the total sales figures of Ref-
erence 3. Combined CC1, production by FMC and DuPont, from Table
G-l, is about 550 million pounds, which is somewhat higher than the
captive use from Reference 3. However, it does not seem unreasonable
to assume that much of the CC1, is used captively by the CFC pro^
ducers themselves.
HF
Appendix B gives the quantities of HF used in CFC-11, CFC-12,
CFC-22, CFC-113, and CFC-114 manufactured in 1977 as 32, 122, 86, 28,
and 12 million pounds respectively. Reference 1 indicates that in
1976 there were nine HF producers with a combined annual capacity of
738 million pounds. Recent industry estimates give a current total
capacity of 683 million pounds. These capacities and the producers
who hold them are given in Table G-2 with an apportionment of the HF
to each producer.
Industry sources claim that Alcoa, Kewanee Industries, Ashland
Oil, and Stauffer Chemical produce no HF for CFC manufacture.
Thus, for these producers, Table G-2 shows no production of HF for
CFCs. The sources further indicate that Essex Chemical devotes about
50 percent of its HF production to CFC needs. All the other pro-
ducers produce most, if not all, of their HF for CFC manufacture.
For the remaining producers, the production apportionment given in
Table G-2 again assumes that production is proportional to relative
capacity.
Some HF for CFC manufacture is imported from Mexico, but this
will not be considered here.
-------
Table G-2
HF PLANT CAPACITY—1977
(millions of pounds)
Annual Capacity
(Percent of Total)
Producer
Allied
Alcoa
DuPont
Essex Chemical
Kewanee Industries
Kaiser
Ashland Oil
Pennwalt
Stauffer Chemical
TOTAL
f\
Total
169
110
150
22
36a
ioob
10
50
36b
683
For CFC
Manufacture
169 (35)
—
150 (31)
11 (2)
—
100 (21)
—
50 (11)
—
480 (100)
T
CFC-11
11
—
10
1
—
7
—
4
—
33°
CFC-12
43
—
38
2
—
26
—
13
—
122
g
CFC-22
30
—
27
2
—
18
—
9
—
86
CFC-113
10
—
9
1
—
6
—
3
—
29°
CFC-114
4
—
4
0
—
3
—
1
—
12
References 4 and 6 give 36 million pounds. Reference 1's total of 738 million pounds is not
correct unless this company's capacity is 36 million pounds.
Industry sources claim that both Kaiser and Stauffer will shortly close their HF plants.
£•
Due to rounding, the values do not add to the actual total given in the text.
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-97-
Racon is the only CFG producer who does not manufacture HF.
However, the firm is now wholly owned by Essex, which does produce HF.
The four CFG producers — Allied, DuPont, Kaiser, and Essex (via
Racon) — together hold 72 percent of the total HF capacity. Industry
sources have indicated that Kaiser and Stauffer will shortly close
their HF manufacturing facilities. There are, however, no published
data which confirm this.
Since Allied and DuPont are the only producers of CFC-113 and
CFC-114, it might be reasonable to assume that only HF produced by
these two companies is used to manufacture CFC-113 and CFC-114.
Unfortunately, the situation is not this straightforward. Although
the mandate of this study does not include a detailed examination of
the interrelationship among the various chemicals producers, many
informal conversations with industry sources have led us to believe
that there exists among chemical producers a high degree of mutual
"cooperation." That is, companies often accommodate the shortage or
surplus of a particular chemical on the part of one company by a
sale or purchase. Thus, although DuPont and Allied may use their
own HF for CFC-113 and CFC-114 manufacture, they probably also use
some manufactured by other producers.
According to Appendix B, 1977 HF production for CFCs totaled
280 million pounds. Assuming that this represents 46 percent of
total HF production (as indicated for 1976 in Table III-5) , and
using the 15 percent rule of thumb as before, the implied 1977 total
HF capacity would be about 700 million pounds. This agrees well with
the value given in Table G-2.
CHC13 AND
Appendix B gives the quantities of C~Cl, which went toward
CFC-113 and CFC-114 manufacture in 1977 as 77 and 25 million pounds
respectively. Also, according to Appendix B, 260 million pounds of
CHC1- were used in CFC-22 production that year.
This is, in fact, widely practiced for the purpose of saving
freight.
-------
-98-
Reference 4 is the only reference to list the producers and the
corresponding capacities for CHC1., and CLC1, . Unfortunately, this
information is dated 1973, and some changes have taken place since
that time. However, these data together with recent data from in-
dustry sources should be adequate. Table G-3 shows the producers,
their capacities, and the amount of CHC1., and C«C1, estimated to
1
have been used in CFC-22 and CFC-113/CFC-114 production in 1977.
The table indicates that CHC1, is produced by Allied, but not DuPont,
and CoCl, is produced by DuPont, but not Allied.
Appendix B indicates that total 1977 production of CHC1_ and
C Cl, were 302 and 603 million pounds respectively. These production
levels imply total capacities of about 350 million pounds for CHC1_
and 690 million pounds for C-Cl, according to the 15 percent rule of
thumb. The agreement with the CHC1. capacity of Table G-3 is fairly
good, while that for C?C1, is very poor. In the latter case, either
the data of Table G-3 are not current or the C?C1, capacity is far in
excess of that necessary for current production levels. One factor
that may account for the discrepancy is that some of the C^Cl, and
CC1, are co-produced and many of the plants that produce C_C1, may
have been originally sized for CC1, production. A comparison of
CjCl, and CC1, producers shows that four — Dow, DuPont, Stauffer, and
Vulcan Materials — are common to both. The CHC1,, production has been
apportioned to Allied and Vulcan Materials based on the amount of
CFC-22 produced by Allied and Racon. The remaining producers were
allocated CHC1- production according to the portion of capacity held.
For C«C1, , DuPont ' s production was assumed equal to the need for
CFC-113 and CFC-114 manufacture, and the other producers were al-
located production according to the percent of capacity held.
The producers of CS_ and their capacities are given only in
Reference 6 for an unspecified year. Table G-4 shows this informa-
Capacity of both C?C1, and CHC1_ are somewhat elusive in that
the former is produced as a co-product with CCl^ and the latter with
methylene chloride
-^
-------
Table G-3
CHG13 AND C2C14 PLANT CAPACITY—1977
(millions of pounds)
Producer
Allied
Diamond Shamrock
Dow Chemical
DuPont
Ethyl Corporation
Occidental /Hooker Chemical
PPG
Stauf f er
Vulcan Materials
TOTAL
Annual
Capacity Production
(Percent) For CFC-22
30 (10)
18 (6)
130 (44)
—
—
—
75 (26)
40 (14)
293 (100)
52
14
104
—
—
—
—
60
29
259a
Annual
Capacity Production
(Percent) For CFC-113
-
160
290
160
50
50
200
70
200
1180
-
(14)
(24)
(14)
(4)
(4)
(17)
(6)
(17)
(100)
—
4
8
50
1
1
5
2
5
76a
Production
For CFC-114
—
1
2
17
0
0
2
1
2
25
aValues listed here may not add to the total given in the text due to rounding.
-------
-100-
tion and the apportionment of the 1977 CS2 production of 51 and 87
million pounds for CFC-11 and CFC-12 respectively, to each producer.
Although Pennwalt and PPG do produce CS^, they do not use CS~ to
manufacture CGI, for CFC-11 and CFC-12, according to industry sources.
Thus, the apportionment of CS_ in Table G-4 only includes FMC and
Stauffer. It was assumed that the FMC production of CS2 was suf-
ficient for the CC1, requirements needed to manufacture CFC-11 and
CFC-12 by Allied Chemical. The balance of CS? production was al-
located to Stauffer.
Appendix B shows that 140 million pounds of CS~ went toward
CFC-ll/CFC-12 production in 1977. Assuming that this amount repre-
sents 26 percent of total CS2 production (given in Table III-5 for
1974) and that the 15 percent rule of thumb also holds, a 1977 ca-
pacity of about 620 million pounds is implied. This value is quite
a bit less than the figure shown in Table G-4. Perhaps the latter
capacity estimate is not recent. The 1974 total production of CS,,
was 772 million pounds, which agrees well with the capacity value
of Table G-4. It is possible that reduced CFC-ll/CFC-12 production
since 1974 may have caused some CS2 plant closings in recent years.
Table G-4
CS PLANT CAPACITY—1977
(millions of pounds)
Annual Capacity
(Percent of Total) CS
Producer Total For CFCs For CFC-11 For CFC-12 Total
FMC 180 (21) 180 (23) 28 51 79
Pennwalt 10 (1)
PPG 60 (7)
Stauffer 600 (71) 600 (77) 20 41 61
TOTAL 850 (100) 780 (100) 48 92 140
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-101-
This, however, is only speculation, and it may be that CS2 capacity
is simply in excess of that required currently. Industry sources
have mentioned the possibility that Stauffer has closed or may close
its plant in the near future.
This chemical, since it is used both as a preliminary and inter-
mediate precursor, is more complicated to assess. According to
Reference 4, intermediate use of chlorine accounts for about 47 per-
cent of the amount produced in 1973.
This reference also provides a list of 1975 Cl_ producers and
their capacities. This list is shown in Table G-5 with the relative
capacity share of each producer and the estimated 1977 Cl» production
devoted to each CFC. The amounts of Cl used to produce CFC-11,
CFC-12, CFC-22, CFC-113, and CFC-114 in 1977 taken from the text here
were 351, 672, 420, 97, and 33 million pounds, respectively. Table
G-5 indicates that Allied, DuPont, Kaiser, and Pennwalt, four of the
CFC producers, are involved in Cl? production in addition to Vulcan
Materials, the raw materials supplier for Racon.
It is likely that the CFC manufacturers listed in Table G-5
(including Vulcan Materials, the supplier for Racon) produced the
Cl- needed for their CFC production. DuPont, Allied (through the
joint venture with FMC) , and Vulcan Materials are CCl, producers
for which Cl_ is necessary. Thus, the Cl_ production for CFC-11 and
CFC-12 in Table G-5 was allocated to these three producers based on
their CCl, needs. The balance was allocated to the other producers.
Allied and Vulcan Materials also produce CHC13 . The C12 for CFC-22
was apportioned to these two firms according to their CHC1« needs
and the balance to the other producers. The Cl- for CFC-113 and
CFC-114 was allocated to DuPont for both C^l^ and direct CFC-113/
CFC-114 production and to Allied for CFC-113 /CFC-114 production in
the same manner .
-------
Table G-5
Cl PLANT CAPACITY—1975
(millions of pounds)
Producer
Dow Chemical
PPG Industries
Diamond Shamrock
Occidental Petroleum
Allied Chemical
01 in
BASF Wyandote
DuPont
Stauffer Chemical
Pennwalt
FMC
Ethyl Corporation
Kaiser
Shell Oil
Vulcan Materials
B. F. Goodrich
Monsanto
Total
Capacity
(Percent)
7920
2400
2304
1930
1188
1170
1116
720
706
684
568
460
386
270
270
216
180
22488
(35)
(11)
(10)
(9)
(5)
(5)
(5)
(3)
(3)
(3)
(3)
(2)
(2)
(1)
(1)
(1)
(1)
(100) b
For
CFC-11
26
8
8
6
77
4
4
201
2
2
2
1
1
1
7
1
1
352°
For
CFC-12
50
15
14
12
142
7
7
376
4
4
4
3
2
2
27
1
1
671°
For
CFC-22
109
33
32
27
84
16
15
10
10
9
8
6
5
4
47
3
2
420
For
CFC-113
9
3
3
2
11
1
1
62
1
1
1
1
0
0
0
0
0
96C
For
CFC-114
3
1
1
1
4
0
0
21
0
0
0
0
0
0
0
—
—
31c
Total
197
60
58
48
318
28
27
670
17
16
15
11
8
7
81
5
4
1570C
•a
AT- *». - 4- 1 0 Q /"\ «. -! 1 1 -! n« _ «. . « .4 ,« **. C ^l .« « _ J j- ._ -J_ 1_ ,^ 1 J 1 ._ .__ _ • ___._! .1 •* •
ALfuuu £. -ju u ui j_- u j_ j.un puuLiuo u j. ^-^-fj
to Reference 3, and these are not included here.
held by
others according
Because of rounding, the percent values do not add to 100 percent.
**
Because of rounding, the values do not add to the totals given in the text.
o
S3
I
-------
-103-
REFERENCES
1. International Research and Technology Corporation, The Economio
Impact of Potential Regulation of Chlorofluorocarbon-Propelled
Aerosols, EPA Contract No. 68-01-1918, April 1977.
2. Lapp, T. W., et al., An Assessment of the Need for Limitations
on Trichloroethylene, Methyl Chloroform, and Perchloroethylene,
Volume I, Midwest Research Institute, Draft Final Report, EPA
Contract No. 68-01-4121, September 1977.
3. United States International Trade Commission, Synthetic Organic
Chemicals, United States Production and Sales, 1970-1976.
4. Arthur D. Little, Inc., Preliminary Economic Impact Assessment
of Possible Regulatory Actions to Control Atmospheric Emis-
sions of Selected llalocarbons, September 1975.
5. Bureau of Domestic Commerce, Economic Significance of Fluoro-
carbons, December 1975.
6. Midwest Research Institute, Chemical Technology and Economics
in Environmental Perspectives, Task I—Technical Alternatives
to Selected Chlorofluorocarbon Uses, February 1976.
7. International Research and Technology Corporation, Short Range
Marginal Costs for Production of Fluorocarbons 11 and 12,
EPA Contract No. 68-01-1918, July 1978.
8. Palmer, Adele R., et al., Economic Implications of Regulating
llonaerosol Chlorofluorocarbon Emissions: An Executive Briefing,
The Rand Corporation, R-2575-EPA, March 1980.
9. E. I. DuPont de Nemours and Company, Nonaerosol Propellant Uses
of Fully Ealogenated Halocarbons, information requested by
the Environmental Protection Agency, March 1978.
-------
Sample C. Technical Report Data Sheet, EPA Form 2220-1
TECHNICAL REPORT DATA
(Please read Instructions on the reverse before complennzi
1. REPORT NO.
EPA-5fiO/12-80-00lb
3. RECIPIENT'S ACCESSION NO.
4. TITLE AND SUBTITLE
5. REPORT DATE 1no_
August, 1980
Regulating Chlorofluorocarbon Emissions;
Effects on Chemical Production
6. PERFORMING ORGANIZATION CODE
7. AUTHOH(S)
Kathleen A. Wolf
8. PERFORMING ORGANIZATION REPORT NO.
N-1483-EPA
9. PERFORMING ORGANIZATION NAME AND ADDRESS
The Rand Corporation
1700 Main Street
Santa Monica, California 90406
10. PROGRAM CLEMENT NO.
B2CL2S
11. CONTRACT/GHANT NO.
68-01-3882
68-01-6111
12. SPONSORING AGENCY NAME AND ADDRESS
Environmental Protection Agency
OTS/ETD/RIB (TS-779)
401 M Street, S.W., Washington, B.C. 20460
13. TYPE OF REPORT AND PERIOD COVERED
Final
14. SPONSORING AGENCY CODE
15. SUPPLEMENTARY NOTES
16. ABSTRACT
This report focuses on the manufacture of chlorofluorocarbons
and the precursor chemicals. It is a support document for the
Rand Corporation study: ' Adele R. Palmer, et. al., Economic
Implications of Regulating Nonaerosol Chlorofluorocarbon Emissions,
R-2524-EPA.
17.
KEY WORDS AND DOCUMENT ANALYSIS
DESCRIPTORS
b.IDENTIFIERS/OPEN ENDED TERMS
C. COSATI Field-Group
18. DISTRIBUTION STATEMENT
19. SECURITY CLASS {This Report!
non-sensitive
Unlimited Distribution
21. NO. OF PACES
l"^4-
20. SECURITY CLASS /This page I
non-sensitive
22. PRICE
CPA Form 2220-1 (»-7J)
12
•CIU.S. GOVERNMENT PRINTING OFFICE! 1980-341-085/4608
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