green cooling initiative: Economic incentives & taxes

Economic incentives and taxes

Financial instruments can provide economic incentives for a faster market penetration of green cooling technologies as well as prevent the investment in environmentally harmful cooling technologies. Such financing instruments can include incentives that directly promote the use of green cooling technologies through subsidies, or taxes that burden the use of cooling technologies with a high climate impact.

  • To further their dissemination, discounts should be available for green cooling technologies. These discounts could be financed, at least partly, through taxes on other, environmentally harmful technologies.
  • Taxes can be levied on the use of high GWP refrigerants, e.g. as practiced in several European countries. They discourage the use of high GWP substances.
  • Investment criteria for eligible technologies should be the use of natural refrigerants and reaching certain MEPS.  
  • Preferential loans (i.e. with lower than normal interest rates or less stringent guarantee requirements) and the integration of green cooling requirements on providing loans (i.e. requirements to install highly energy efficient equipment with natural refrigerants) are possibilities for public financing institutions.

Examples for typical financial instruments to promote green cooling technologies:



Some countries have introduced taxes on HFCs. The taxes are based on CO2 equivalents, so that refrigerants with higher GWP are taxed higher. In some countries, such as Norway, there is a refund of taxes if the refrigerant is returned for recycling or destruction. Assuming that there are no leaks, the tax essentially becomes a deposit scheme, and this gives operators an incentive to reduce leaks. In Denmark the tax is paid upon import and will only be returned without deductions if the same amount is exported after use. 

HFC taxes range from 2.88 Euro in Slovenia to 40 Euros in Norway per kg CO2eq.

Taxes in Slovenia were considerably higher until summer 2013 (up to 16 Euro/t CO2eq). However, a lack of taxes in neighbouring countries led to an HFC black market, rendering the tax ineffective. Other countries, such as Poland and France are considering or planning the introduction of HFC taxes.

Taxes on HFCs also exist in Spain, France, Poland and Switzerland.

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