On March 2, 2015, the U.S. Environmental Protection Agency published a final rule expanding the number of refrigerants approved for use in a variety of refrigeration and air-conditioning equipment as compliant with the “Stratospheric Ozone Protection” requirements of the Clean Air Act and implementing regulations.  (See 42 U.S.C. § 7671; 40 C.F.R. Part 82, Subpart F.)  The EPA issued the rule pursuant to its authority under the Act to identify and publish lists of acceptable and unacceptable class I and class II ozone-depleting substances.  The final rule authorizes the use of ethane, isobutene, propane, the hydrocarbon blend R-441A, and difluoromethane (HFC)-32 in new refrigeration appliances for various uses, including household refrigerators and freezers, stand-alone commercial refrigerators and freezers, vending machines and in-room air-conditioning units.

Background

The EPA is authorized under the Clean Air Act to assess and regulate substitutes for ozone-depleting chemicals as part of its Significant New Alternatives Policy (SNAP) Program.  One of the primary focuses of the SNAP Program is to approve low global warming potential substitutes for the ozone-depleting substances used in refrigeration and air conditioning.  If the EPA determines a substitute substance will reduce overall risk to human health and the environment, it will add the refrigerant to its approved list.  Some approved substitutes are subject to conditions limiting the approved methods of use.

Summary of the Final Rule

In the final rule, the EPA approved the use of ethane, isobutene, propane, the hydrocarbon blend R-441A and difluoromethane (HFC)-32 for the following end uses:

• Ethane for very low temperature refrigeration and nonmechanical heat transfer;
• Isobutene for retail food refrigeration and vending machines;
• Propane for household refrigerators, household freezers, household combination refrigerators and freezers, vending machines and in-room air-conditioning units;
• Hydrocarbon blend R-441A for retail food refrigeration, vending machines and in-room air-conditioning units; and
• Difluoromethane (HFC)-32 for in-room air-conditioning units.

In addition to authorizing the use of these substitutes, the new rule exempts four of the refrigerants, excluding difluoromethane (HFC)-32, from the Clean Air Act prohibitions on venting, release and disposal.  The EPA exempted these refrigerants because it found that neither their venting and release, nor their disposal, pose a threat to the environment.  Nonetheless, the EPA recommends that the authorized venting of these refrigerants occur in a well-ventilated area, preferably outside of any buildings.  The EPA continues to prohibit difluoromethane (HFC)-32 from being vented or otherwise released or disposed of by any person maintaining, servicing, repairing or disposing appliances containing the substitute.  Even for the exempted refrigerants, there may be other legal obligations pertaining to their handling and disposal.

The newly-approved refrigerants are subject to use conditions that address the flammability risks associated with the use of these refrigerants.  The EPA limits the amount of refrigerant allowed in each type of appliance and requires the use of warning labels and color-coded hoses on equipment to indicate the use of a flammable refrigerant.  In addition, the EPA recommends only technicians specifically trained in flammable refrigerant substitute protocols handle these substitutes when maintaining, servicing, repairing or disposing of equipment that contain them. 

Implications of the Final Rule

Manufacturers and users of refrigerants and refrigeration appliances are not required to convert to approved alternative refrigerants or to new appliances that accept them.  In fact, the substitutes are not authorized for all end uses.  However, conversion could potentially provide the following benefits to both refrigeration appliance manufacturers and industrial users, including pharmaceutical manufacturers, data centers, grocery retailers, cold-storage warehouses and distribution facilities, oil and gas production sites and appliance retailers:

• Exemptions from, and improved compliance with, the “Stratospheric Ozone Protection” requirements of the Clean Air Act and potential avoidance of enforcement penalties.
• Potential cost savings from purchasing less expensive refrigerants as hydrochlorofluorocarbon refrigerants, such as R-22, are phased out and become increasingly costly.
• Potential carbon credits or offsets in carbon cap-and-trade programs and potential incentives from power plants, utilities and/or state governments seeking to comply with the EPA’s pending Clean Power Plan.

Converting to an approved refrigerant could, however, impose additional costs.  The final rule limits the use of the newly authorized refrigerants to new equipment; the substitutes may not be used as a “retrofit” refrigerant in existing equipment.  Thus, manufacturers and industrial users are likely to incur substantial up-front costs for the replacement of existing appliances with those in which the approved alternatives may be used.  Additionally, given the flammability risks of the approved alternatives, manufacturers and industrial users may incur costs to redesign appliances to withstand flammability risks and for training staff on the safe handling of flammable refrigerants, as well as other efforts to comply with regulations promulgated by the Occupational Safety and Health Administration.