EPA Publishes New Rule Restricting the Use of HFCs in Nonroad Equipment

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10/26/2023

On Oct. 24, 2023, the Environmental Protection Agency (EPA) published its Technology Transitions Restrictions on the Use of Certain HFCs under the AIM ACT Final Rule, Phasedown of Hydrofluorocarbons: Restrictions on the Use of Certain Hydrofluorocarbons under the American Innovation and Manufacturing Act of 2020.

This Final Rule places restrictions on the use of hydrofluorocarbons (HFCs) in certain sectors and subsectors of the U.S. economy, including the off-road equipment industry.  The rule will require all U.S. manufacturers using HFCs in their mobile vehicle air conditioning (MVAC) systems to transition away from these refrigerants by Jan. 1, 2028, with a transition window of three years for manufactured equipment in inventory.  By Jan. 1 2031, all equipment sold into commerce will be fully restricted from using HFCs in MVAC systems.

Legislative Background

On Dec. 27, 2020, Congress passed the American Innovation and Manufacturing Act, also known as the AIM Act, which formally adopted the administrative provisions of the Kigali Amendment to the Montreal Protocol. Ratified in 1987, the Montreal protocol helped require signatory countries to phase out the use of certain halogenated hydrocarbons of concern (i.e., chlorofluorocarbons (CFCs)) responsible for depleting the ozone layer. The protocol eventual led to various sectors throughout the world’s economy adopting low or zero ozone depleting potential (ODP) refrigerants. For the off-road equipment industry, this meant the widespread adoption of HFC-134a. 

The Kigali amendment to the Montreal protocol requires signatory countries to replace their current refrigerants, like HFC-134a, with low global warming potential (GWP) substances. Specifically, the Kigali amendment seeks to gradually phasedown the production of high GWP HFCs by 80-85% over the next several decades. Policymakers estimate that the scarcity of HFC supply and the associated price increases will encourage manufacturers to adopt more climate friendly refrigerant solutions for their products.

AEM Response

Responding to this global movement to adopt more climate friendly refrigerant solutions, AEM initiated a project to list the refrigerant 2,3,3,3-tetrafluoroprop-1-ene, also known as HFO-1234yf with a GWP of 4, as acceptable to use in air conditioning systems of newly manufacturers nonroad vehicles under the EPA’s Significant New Alternatives Policy (SNAP) Program. Under Federal law, industry stakeholders must seek EPA approval under the SNAP program prior to adopting and implementing new refrigerants and refrigerant technologies in their end products. AEM submitted their final SNAP application in March of 2021, and received final approval on May 4, 2022 to use HFO-1234yf in the following nonroad equipment types:

  • Agricultural tractors greater than 40 hp;
  • Self-propelled agricultural machinery;
  • Compact equipment;
  • Construction, forestry, and mining equipment; and
  • Commercial Utility Task Vehicles

Final Rule

While the AIM Act seeks to reduce the total production and use of HFCs across the entire U.S. economy, it also allows the public and industry stakeholders to issue petitions asking EPA to issue further rules, regulations, and restrictions regarding their use. In response to petitions asking for full restrictions on the use of HFCs in various industry sectors on Oct. 7, 2021, and Sept. 19, 2022, the EPA initiated a new rulemaking addressing these external stakeholder requests.

Following a near yearlong rulemaking, the EPA announced the following requirements for nonroad equipment manufacturers:

  • A full restriction on the use of HFCs with a GWP above 150 in the nonroad equipment sector by Jan. 1, 2028;
  • A sell through period for established inventory of 3 years;
  • A labelling requirement for products, specified components, and systems that identifies the refrigerant in use and the date of manufacture of the machine (i.e., 4-digit year);
  • Additional recordkeeping and reporting requirements for any entity that domestically manufacturers or imports products or specified components that use or are intended to use regulated refrigerants.

This list of requirements is non-exhaustive and does not include many of the details and administrative processes mandated by the Final Rule. It is important for effected stakeholders to review the rule for themselves to determine their individual regulatory risks.

AEM will continue to engage with the EPA on this issue, among many others. If you, or your company, are interested in learning more about this rule, or are interested in drafting the industry response, please contact AEM Senior Director Safety & Product Leadership Jason Malcore at jmalcore@aem.org.

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