Top considerations for building owners evaluating variable refrigerant flow (VRF) systems


When considering the use of Variable Refrigerant Flow (VRF) systems, building owners should consider certain important factors that could lead to increased costs and concerns with energy efficiency and reliability.

Top considerations before installing VRF systems

VRF systems are a rapidly evolving solution and offer many appealing promises to building owners and property managers hoping to complete their projects without hiccups or large capital investments.

However, when looking past the initial benefits of VRF technology, it’s clear that there are some critical considerations to address before investing in these systems.

1. Maintenance and installation

While VRF systems are typically less expensive to install than chillers and boilers (hydronic systems), they require specialized training and maintenance expertise. VRF systems were introduced in Japan in the 1980s, but they are relatively new to the U.S., where it took 25 years to embrace this technology. Today, VRF systems command only 5% of the total heating and cooling market.

Because these refrigerant-based systems comprise several complex pieces of equipment, they are best served by technicians familiar with the best practices for VRF systems. Unlike hydronic systems, all parts for a VRF system are proprietary and made by a single manufacturer. Single sourcing provides the opportunity for many issues. First, the cost is dictated by a sole source manufacturer with no competition, so the aftermarket parts can be very costly. Second, supply chain issues can lead to problems in procuring alternative parts.

For today’s building owners opting for VRFs, qualified HVAC technicians will have to be kept onsite or hired to operate and perform preventative maintenance and repairs. As experts note, great care must be taken during installation to prevent moisture, dust, and contaminants from entering the refrigerant piping, and it must be installed tightly to prevent leaks. Improper installations run the risk of harmful leaks or premature equipment failures.

Unlike a chiller, which centrally locates refrigerant, VRF has many refrigerant lines running throughout a building. With a high volume of refrigerant lines and fittings, VRF systems have a higher probability of leaks, which are challenging to locate and repair. Furthering the issue, refrigerant lines are installed over occupied spaces; therefore, the refrigerant leaks into areas with occupants.

It’s important to prepare for ongoing maintenance costs, including regular inspections, filter replacements, and system cleaning when opting for VRFs. Alternative energy solutions, such as district energy, pose less of a concern regarding maintenance because energy generation is done offsite at a central facility and performed by the energy provider.

Risks associated with VRFs and onsite chillers, like potential refrigerant leaks, are eliminated and shifted to the central district energy facility, which is regulated and has strict safety standards to ensure staff and surrounding communities are safe. Further, maintenance is handled by district energy experts, meaning that building owners do not need to expend additional labor costs.

2. Electricity reliance

Electricity reliance should also be considered when thinking about installing VRF systems today. VRF systems require electricity to run, exposing buildings to multiple risks that are exacerbated in locations that experience high humidity and low temperatures.

Why? VRFs typically have to work harder than other heating and cooling systems. The compressors used in VRF systems are installed in a complex field refrigerant system and are forced to absorb outside air in heating mode. Air-source heat pumps can be more efficient, but rapidly lose efficiency, as the outside temperature drops below 40 degrees and require a backup heating source in cold climates like the Northeast. The compressor also spins faster when heating, reducing the life span of the bearings and compressor.

VRF systems are particularly unsuitable for certain buildings that have high energy and reliability needs or strict humidity control considerations, such as healthcare and life science labs. Should there be a power outage during a storm, the building cannot provide heating and cooling functions. This setback could endanger occupants and damage building assets and lab experiments. In buildings where indoor air quality (IAQ) is a concern, VRF systems would require increased emergency or standby generation capacity.

Electricity reliance also means that buildings are exposed to volatile electricity rates and the policy changes that may drive rates up, especially in cities like Baltimore and Philadelphia, where the electric grid’s capacity is struggling to meet demands.

Many buildings today are billed based on peak electricity usage rates, their usage during the hottest and coldest days of the year. VRFs can drive up peak demand and costs dramatically.

With VRFs, additional costs are incurred when building owners seek to retrofit older spaces. Owners need to consider the amount of electricity necessary for the older buildings because they typically do not have the required capacity and may require expensive upgrades.

Due to the unpredictable nature of retrofitting older buildings, district energy is appealing to owners that are looking to electrify but want to keep variable loads for heating or cooling low, creating a flat load profile with lower demand charges.

With a blend of hedging and market commodity prices, district energy solutions are able to guard against unexpected price spikes in the market and hedge fuel prices for a significant portion of our expected steam load for the heating season. Through these thoughtful hedging strategies, Vicinity’s customers experience more stable rates and greater budget certainty while achieving their sustainability goals.

3. Energy efficiency considerations

While VRFs are generally lauded for their high efficiency, their performance can vary depending on several factors. For example, some building owners have yet to be satisfied with the performance of their VRF systems when temperatures drop below 40 degrees.

Ultimately, certain factors influence whether a VRF system delivers the efficiency rates it promises:

  • System design
  • Installation of equipment
  • Outdoor temperatures
  • Original building design
  • Application of equipment
  • Ongoing maintenance of the building and VRF equipment

If installed incorrectly or improperly maintained, VRF systems will likely malfunction, causing a major disruption to building tenants. A study even found that VRF systems required replacement a decade earlier than other HVAC systems, which is why they are widely regarded as ‘throwaway’ systems.

Disposing of defective VRF equipment and replacing it altogether rather than repairing it is common practice. This practice can lead to a lapse in service, resulting in the wasteful disposal of mechanical equipment.

To avoid interrupted service, building owners should evaluate their potential VRF system’s energy efficiency ratings, seasonal performance, and the potential for energy savings in their specific building before making a purchase decision.

4. Capital costs

The average lifespan of a compressor is about 10 to 15 years, and the overall VRF system is life 15 to 20 years. Once the VRF system has reached the end of its useful life, the entire building’s HVAC system needs to be replaced. Even the refrigerant piping throughout the building is replaced, due to the changing requirements of new refrigerants.

A study done by the Washington State University estimated that the installed cost of a VRF system is approximately $18 per square foot served – compared with a code-minimum system cost of about $12 to $15 per square foot, a price difference that compounds quickly over the scale of an entire building.

Due to ever-more stringent indoor air quality requirements, specialized central air handlers, called dedicated outdoor air units, still require ductwork for each occupied space.

5. Building infrastructure requirements and risks

Infrastructure requirements for VRFs are critical for building owners to consider, especially when looking to avoid additional capital costs. These systems require specific infrastructure considerations, such as dedicated space for outdoor units, indoor unit placement, and appropriate refrigerant piping routes.

Owners should evaluate whether their building can accommodate these requirements without significant modifications or additional expenses. VRF systems are not ideal for use in high-rise buildings because the maximum allowable vertical distance between an outdoor unit and its farthest indoor unit is approximately 150 ft., and the maximum vertical distance between two individual indoor units is about 45 ft., meaning that valuable space on multiple floors is occupied by VRF equipment.

VRF systems are also typically housed on rooftops, precluding that space from being used for amenities like lounges, gardens, or rooftop pools, and require several roof penetrations, which can expose building envelopes to structural issues and potential leaks.

In comparison, district energy only requires about a parking space worth of equipment, typically in the basement of a building, and allows owners to maximize rooftop and basement spaces.

6. Use of refrigerants

Refrigerant-based systems like VRFs expose buildings to safety and financial risks, whether it be requiring specialized maintenance for repairs, or susceptibility to leaks that are potentially harmful to building occupants and the environment.

VRF refrigerants are flammable due to their base of propane and butane. The flammability of some refrigerants such as R32 is becoming a safety concern due to the high amount of refrigerant that is piped throughout a building within VRF systems, and their high potential for leaks. For this reason, building standards such as ASHRAE Standard 34-2019 have been established to limit the concentration of refrigerants within occupied spaces. Regulations on refrigerants are often changing. As regulations change, systems will require significant modifications or total replacement to be compatible with new refrigerants.

VRF system leaks are caused by several factors — one is chemical corrosion. The production of condensation and the use of chlorine in VRF pipe insulation can cause chemical corrosion of aluminum piping in the system. Holes in the aluminum piping can allow refrigerant to leak and cause the systems to stop performing and ultimately fail.

Making the best choice for commercial buildings

When planning for heating and cooling needs, building owners should consider all options and identify the best choice for reducing risk and ongoing capital investments. Below is a list of questions to help building owners and operators make the best choice for their buildings:

  • Life-cycle cost: What are the installation and ongoing costs associated with the VRF equipment or provider?
  • Maintenance: What maintenance is typically required for the VRF system? Does the VRF provider include service from specialized technicians?
  • Service life: How long does the VRF equipment typically last?
  • Regulatory compliance: What does the current regulatory landscape look like for VRF systems and their use of refrigerants?
  • Rooftop penetration: Can this building accommodate the rooftop penetration required by the VRF equipment?
  • Reliability: How critical are the building’s daily operations? Do they rely on uninterrupted energy to maintain strict indoor air quality (IAQ) standards?

Learn more about our electrification plan in our white paper.

Vicinity Energy White Paper - Revolutionizing Urban Sustainability

Nate Paist

Nate Paist is a Manager in Vicinity’s Business Development group responsible for technical support for our Sales and Account teams. His primary responsibility is to ensure that the energy solutions we provide to our customers meet their needs and support the growth and health of our business. Nate writes about topics relating to the energy industry and decarbonization solutions.