Why CO₂ Refrigeration Is Catching on in Small Format Stores

The leading alternatives for small format operators today are newer HFO synthetic refrigerants or natural refrigerants such as propane (R-290) and CO₂ (R-744). Each carries tradeoffs that operators must weigh carefully against upfront costs and long-term ownership expenses. 

HFO Refrigerants 

Many of the EPA-approved HFO refrigerants with the lowest GWP are classified as A2L — mildly flammable — and require refrigerant detection systems on equipment. Building configuration may also dictate the need for additional roof or wall penetrations and new exhaust fans. 

Beyond installation requirements, some longer-term concerns are emerging. While several HFO blends are approved as lower-GWP refrigerants, their GWP ratings are still well above available natural refrigerants. Additionally, many HFO refrigerants contain PFAS compounds — per- and polyfluoroalkyl substances — commonly referred to as “forever chemicals.” Linked to cancer and other health risks, PFAS chemicals are already subject to regulation in Europe, raising the possibility of future domestic restrictions. For operators who have lived through multiple refrigerant transitions, these uncertainties are a material business consideration. 

Natural Refrigerants 

For small self-contained equipment, hydrocarbon refrigerants such as R-290 have proven effective. However, their flammability restricts their use in remote systems — the type commonly used for walk-in coolers and cold-room applications. For those installations, CO₂, or R-744, is drawing increasing attention. 

CO₂ has been used as a refrigerant for more than a century. Its use peaked in the 1930s before being displaced by HCFC refrigerants, which were easier and less expensive to apply. Advances in copper alloys and electronic controls have since made CO₂ systems more practical. Modern alloys can withstand CO₂‘s high operating pressures using standard brazing practices, replacing the specialized steel pipe welding that earlier systems required. Modern controls allow systems to maintain stable operation as ambient conditions change. 

CO₂ systems have been standard in supermarket applications for years and are increasingly common in industrial and cold storage settings. As adoption has grown, component availability has improved, and costs have declined — a trend now beginning to benefit smaller operators as well. 

At a recent natural refrigeration training summit hosted by the North American Sustainable Refrigeration Council (NASRC), more than a half-dozen manufacturers showcased remote CO₂ condensing units designed for small-footprint store applications. Contractors and end users had the opportunity to ask manufacturers directly about installation requirements and best practices. 

A consistent theme across presentations was the importance of ambient temperature management. CO₂ reaches its critical point — where temperature and pressure lose a direct relationship — at 88°F. Above that threshold, system efficiency declines. Manufacturers represented at the summit offered units rated for operation up to 110°F, with some offering adiabatic cooling options that use water to increase efficiency during high-ambient conditions. 

Manufacturers also emphasized that CO₂ units are designed to operate as similarly as possible to traditional HFC systems. Piping uses standard brazing practices, and electrical controls are described as user-friendly. Charging procedures and safe handling practices differ from conventional systems, and manufacturers have developed training programs to address those differences. 

Costs And Considerations 

Upfront costs for CO₂ systems remain higher than comparable A2L systems, though that gap is narrowing as production scales and component prices fall. Some states, including California, are exploring incentive programs to help offset initial costs. 

Over the long term, CO₂ systems can offer favorable economics. Energy efficiency is high when operating below 88°F, and CO₂ refrigerant itself is low-cost. Operators also avoid the compliance uncertainty tied to synthetic alternatives. 

Before committing to any system, operators should consult with their contractors and carefully evaluate the full range of costs — including potential future compliance expenses — associated with each option.