Refrigerant Regulation Watch

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The cooling season is nearly upon us and contractors across the nation are prepping for a hopefully busy and profitable summer. Nevertheless while you and your crews are out on repair or replacement jobs, work in Washington continues on initiatives that have the potential to change the HVACR industry in a significant way. And 2014 is shaping up to be a landmark year for refrigerant policy.

In a confluence of several major policy actions related to the most commonly used refrigerants in the industry, what happens over the next year will decide the price and supply of HCFCs, how you purchase and handle HFC refrigerants, and whether the government expands the use of hydrocarbon (propane based) refrigerants.

The Last Legs Of The HCFC Production Phase Out
On December 24, 2013, the U.S. EPA initiated the process to set the annual production allocations for HCFCs, like R-22, for the years 2015-2019 through a notice and comment rulemaking. The comment period for the proposal closed on March 10, 2014, and following a review of the comments, the EPA will publish a final rule in the fourth quarter of this year.

The 2015-2019 Allocation Rule will be the final allocation leading up to the year 2020, when the phase out on the production of virgin R-22 is complete. Starting in 2020, it will be illegal to produce or import virgin HCFCs for sale in the United States. The sole legal source of R-22 for servicing purposes, will be stockpiled inventories of virgin gas produced before January 1, 2020, or recycled, recovered, or reclaimed R-22.
The EPA is working hard to conclude this rulemaking as quickly as possible to give the industry plenty of time to plan and prepare for the new allocation amounts. If the EPA cannot complete the rule before January 1, 2015, it’s likely the industry may see a repeat of the uncertainty over supply and price that occurred in early 2012 and 2013.

Despite the allowance to manufacture and install dry charged units, the demand for R-22 has waned in the last few years. Some stakeholders are pushing for EPA to zero out the allocation, a move that would cause the price to rise and encourage more R-22 recovery. In ACCA’s view, the EPA should allocate an appropriate amount that minimizes any market uncertainties in the last few years of the phase out.

Expanding Section 608 And The Montreal Protocol To Include HFCs
On January 31, 2014, the Alliance for Responsible Atmospheric Policy, an industry coalition of businesses and associations that use HCFCs and HFCs, petitioned the EPA to include hydrofluorocarbons (HFCs) under the provisions of Section 608 of the Clean Air Act, intended to reduce refrigerant gas emissions. In their view, including HFCs under Section 608 would reduce the emissions of these important compounds that provide safe and effective refrigeration and air conditioning services, but are also greenhouse gases. Section 608 already includes requirements for chlorofluorocarbons (CFCs) and HFCs like R-410a. The current rules under Section 608, prohibit a technician from knowingly venting HFC substitutes during the maintenance, service, repair, or disposal of appliances. HFC refrigerant substitutes that do not contain an ozone-depleting substance (such as R-410A or R-134a) are not covered under the refrigerant sales restriction. Therefore, Section 608 technician certification is not required in order to purchase HFC refrigerant substitutes that do not contain an ozone-depleting substance. It remains illegal.

Expanding The Significant New Alternatives Policy Program
Last year, the Obama Administration proposed to mitigate the effects of climate change by working internationally to phase down the use of HFCs through the Montreal Protocol. The Administration is also trying to expand the Significant New Alternatives Policy (SNAP) Program to encourage private sector investment in low-emissions technology by identifying and approving climate-friendly chemicals while prohibiting certain uses of the most harmful chemical alternatives. This year the EPA will initiate two rulemakings to expand the list of low-GWP alternatives and a SNAP alternatives status change rule. Some of the new low-GWP alternatives under consideration are flammable hydrocarbon refrigerants, so their approval would come with specific use conditions. EPA has already approved three hydrocarbon refrigerants for very limited uses, and only in small quantities, but this is an area where contractor and occupant safety, must be paramount.

It’s an election year with a lot on the line, so make sure you look past all the partisan noise this summer and pay attention to what the EPA is doing. Whether it’s the allocation of R-22 for the next five years, how HFC refrigerants are treated under the Section 608 Clean Air Act rules, or the safety of new refrigerants approved for use in the U.S., big changes for this industry are on the horizon and you will want to pay attention.

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Posted In: ACCA Now, Government