This article addresses the application of he three principle alternatives for R-22. They are R-134a, R-407C and R-410A. The application studied is split system unitary air- conditioners that are in common use in the U.S. The article is divided into two segments. The first segment presents an analysis of the impact of each refrigerant on the system performance. In the second segment, an analysis of the impact on manufacturing cost was performed on the two refrigerants that exhibited the best performance from the first segment, namely R-407C and R-410A. The performance/cost modeling was performed using a system performance computer model1 to optimize the design around the particular refrigerant to achieve the same capacity and efficiency as R-22 at the lowest cost.