In the first of several actions coordinated with other HVACR manufacturing, distribution, and contracting associations, ACCA and its partners have filed suit to prevent increased refrigerant prices and a rushed transition to highly flammable A3 refrigerants that will threaten consumer affordability and safety.
EPA’s final Technology Transitions Rule (TTR) handed contractors a real win in May, lifting the installation deadline for R-410A equipment that ACCA had fought hard to remove. That was the central recommendation in ACCA’s comments on the rule.
But ACCA’s comments also urged EPA not to make changes that would increase demand for the limited supply of hydrofluorocarbon (HFC) refrigerants or hasten a transition to highly flammable A3 refrigerants. The final rule did exactly that. Allowing the continued manufacture of commercial refrigeration systems using legacy refrigerants until 2032 will significantly increase demand, and EPA’s own analysis projects a 12 to 24% increase in U.S. refrigerant prices by 2029.
ACCA announced on June 25 that they have joined the Heating, Air-conditioning, & Refrigeration Distributors International (HARDI) and Plumbing, Heating, Cooling Contractors – National Association (PHCC) in filing a petition for judicial review in the United States Court of Appeals for the D.C. Circuit, arguing that EPA did not follow required procedures in developing the Technology Transitions Reconsideration Final Rule.
In seeking legal review, the trade associations’ goal is to have the rule partially vacated and then participate in a proper process that balances the interests of grocers and cold storage facilities with all others who depend on a stable and predictable refrigerant market.
Why prices rise for every contractor and their customers
EPA gave supermarkets and cold storage warehouses years of extra time to install systems using higher-GWP refrigerants, setting interim limits of 1,400 GWP for supermarket and remote condensing systems and 700 GWP for cold storage, all through 2032. That’s a major retreat from the 150/300 GWP framework in the 2023 rule.
Signed into law by President Trump in 2020, the American Innovation and Manufacturing (AIM) Act’s HFC phasedown schedule is not expected to change, so every pound of refrigerant consumed by these outdated supermarket systems will effectively remove several pounds of R-32 or R-454B from the market. Prices will inevitably rise, and every home and business owner will pay more.
The refrigeration sector will suffer too. While these changes will result in significant short-term savings for grocers needing a system replacement, all refrigerant users will pay more in the long run. HARDI estimates $13 billion in added costs for the refrigeration subsector alone.
The bigger threat: a rushed transition to A3 refrigerants
Tighter supply and higher prices will also encourage states to rush a transition to A3 refrigerants like propane, which are highly flammable and nowhere near ready for mass adoption.
Even as contractors adjust to the A2L transition, New York, California, and Washington have already empowered their regulators to ban A2L equipment, with deadlines as soon as next year. The refrigeration changes in EPA’s rule will provide ammunition for advocates seeking new refrigerant regulations in at least a dozen other states. As that patchwork expands, pressure for another national transition will grow.
While ACCA believes another national refrigerant transition could be avoided under the prior rule, some industry experts believe these changes will make a national A3 transition inevitable as soon as 2032. That’s the outcome this petition is meant to head off.
What the HVACR industry is asking the court to find
The joint petition rests on two arguments. First, the AIM Act provides for a one-year waiting period before deadline changes take effect, which puts the rule’s 60-day effective date at odds with the plain meaning of the statute. Second, EPA’s analysis was arbitrary and capricious: the agency never clearly explained how it weighed the AIM Act’s statutory factors or why such a long delay is warranted for technologies it has already deemed acceptable.
ACCA and its partner associations believe the final rule’s rationale rests on the false premise that the original Technology Transitions Rule had already increased grocery consumers’ costs. The commercial refrigeration restrictions at issue had not yet taken effect when EPA proposed the reconsideration rule, and existing systems can continue to be used and serviced, so the rule could not have been responsible for higher grocery prices.
The petition leaves relief for residential and light commercial R-410A equipment untouched, targeting only the commercial refrigeration deadline changes made after October’s proposed rule.
Fighting for contractors on multiple fronts
ACCA contractor members highlighted minimizing disruption from refrigerant transitions as one of their top policy priorities. EPA’s action will destabilize the refrigerant market in several ways, so this week’s intervention is one front in that fight.
To head off a patchwork of state rules, ACCA is also calling on Congress to add federal preemption under the AIM Act. Finally, the association is partnering with Allied Contracting Organizations and contractor champions to fight these conflicting state regulations in New York, Washington, and wherever they emerge.
ACCA will keep members updated as the litigation and related efforts proceed.
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