A couple months ago I sat in on a presentation done by a friend of mine who is a refrigerant engineer for Daikin America (Daikin’s chemical division). The presentation mostly centered around the newly passed AIM Act and the implications this will have on HFC gases like the much loved R-507A and R-404A. The AIM Act was passed right before the new year and, like many people, I was unaware of the severe impact this will have on the refrigeration industry in just a few short years. Here is a summary of what I have uncovered so far through research.
On December 27, 2020, then President Trump signed into law the massive Consolidated Appropriations Act, 2021. Within this bill was the AIM Act (The American Innovation and Manufacturing Act). The AIM Act provides the EPA broad legal power to control the phase-down of HFCs through production and consumption limits. The AIM Act looks to phase down HFC use by 85% within 15 years using the 2011–2013 HFC consumption as the baseline. What makes this different from the previous SNAP rules is it now provides the EPA with broad legal authority to phase down the use of HFCs to meet this 15-year target. It does this by:
- Allows the EPA to put into place limits on HFC production
- The EPA can establish sector-based use restrictions of HFC’s
- Allows EPA to regulate HFC reclaim, servicing, repair, and disposal practices
Defined production and consumption targets for specific periods during the next 15 years
What does this mean?
One of the key takeaways is we will begin to see increasing prices of popular HFCs within the next 3-4 years because of the new production and consumption targets that must be met. This will also have some impact on blends like R-448A and R-449A because it will impact the price of the HFCs contained in those refrigerants. However, because these blends contain fewer HFCs the impact may not be as great as they are for pure HFC’s such as R-507A or R-404A. Make no mistake, the end goal is the elimination of all HFC’s in refrigeration and air conditioning systems, and then I believe they will turn their attention to the elimination of refrigeration blends.
In terms of price and availability, refrigerant blends like R-448A and R-449A offer the best longer term synthetic refrigerant option. However, natural refrigerants like CO2, ammonia, and propane are the much safer long-term refrigerant choices from an availability and price standpoint. With natural refrigerants there is no concern about being regulated out of existence. These new HFC limits will begin in 2022 but ratchet up during different periods as shown in the above table. At the end of last month the EPA issued its draft proposal. The EPA must have the final rule completed on or before September 23, 2021. At that time we will have a much clearer understanding of how this is going to be implemented.
Below are some links with more information for you to review at your convenience
Proposed Rule from EPA **Released May 3rd**
Article: US Enacts HFC Phase Down Law as Part of COVID Relief Bill