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New EPA HFC Rule in 2021 Under the AIM Act
Are you aware of the important milestone that happened recently with the AIM Act? The first proposed rulemaking under the AIM Act, or what we call the new EPA HFC rule, was published in the Federal Register in May 0f 2021. This article will bring you up-to-speed on what happened, and when, and what matters most.
First Proposed EPA Rule to Phasedown HFCs under the AIM Act
As you may recall, in December 2020, the AIM Act, a new HFC phasedown law in the U.S., was passed that authorizes a 15-year phasedown of HFC refrigerants for environmental sustainability.
The AIM Act has large bipartisan support as it will help the U.S. remain competitive in a global market and address climate change and our environmental footprint.
Essentially, this new regulation gives the EPA authority to address and manage HFCs in three ways:
- Phasing down production and consumption;
- Maximizing reclamation and minimizing releases from equipment; and
- Facilitating the transition to next-generation technologies through sector-based restrictions.
This new proposed rule falls under the first way: phasing down production and consumption by implementing an allowance allocation and trading program.
Allowance Allocation and Trading Program
The U.S. EPA is proposing to establish production and consumption baselines and codify the phasedown schedule for regulated HFCs:
Table 2: HFC Phasedown Schedule and Consumption & Production Allowance Caps
| Year | Consumption and Production Allowance Caps as a % of Baseline | Estimated consumption & production allowance caps in MMTEVe |
|---|---|---|
| Proposed Baseline** | Consumption: 299 MMTEVe Production: 375 MMTEVe | |
| 2022-2023 | 90 percent | Consumption: 269.1 Production: 337.5 |
| 2024-2028 | 60 percent | Consumption: 179.4 Production: 225.0 |
| 2029-2033 | 30 percent | Consumption: 89.7 Production: 112.5 |
| 2034-2035 | 20 percent | Consumption: 59.8 Production: 75.0 |
| 2036 & after | 15 percent | Consumption: 44.9 Production: 56.3 |
The initial methodology for issuing allowances for 2022 and 2023 will be established in this proposed rulemaking. The EPA is also requesting comment on past production and/or consumption values and which years to use.
Additionally, for compliance and enforcement, the EPA is proposing to establish a tracking system for HFC movement through commerce; require the use of refillable cylinders; establish administrative consequences for noncompliance (in addition to any civil and criminal enforcement action); and establish recordkeeping and reporting requirements.
Prepare for the HFC Phasedown
In terms of refrigerant compliance and refrigerant tracking, the AIM Act is solidifying the next refrigerant transition. Your stakeholders and workforce must be ready for the next generation of corporate sustainability, answering sustainability audit questions, and ESG reporting, and that's where the Refrigerant Geeks come in.
Our team of experts with more than 25+ years of experience can ensure you're prepared for the coming HFC phasedown. In the year of 2021 alone, much will be happening with the AIM Act. In fact, by September, this proposed rule will be final.
And if you're looking to get ahead of the game, get in touch with Trakref today. We're a software corporation that has been in the regulatory compliance software and environmental compliance calendar software space for years. As an environmental software provider, we make sure our refrigerant capabilities will keep you in compliance with new regulations.
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