The Natural Resources Defense Council (NRDC), a global environmental NGO, has outlined the case against the U.S. Environmental Protection Agency (EPA)’s revision of the Technology Transitions Rule on HFC emissions announced in May.
The revision (or “reconsideration”) of the Technology Transitions Rule extends compliance deadlines by several years for the use of much lower GWP refrigerants in supermarket systems, remote condensing units and cold storage warehouses, among other changes.
For example, the revised rule allows new retail food supermarket equipment to use refrigerants with a maximum GWP of 1,400 beginning January 1, 2027, instead of requiring refrigerants with GWP limits of 150 or 300 (depending on charge size and equipment configuration). The lower limits are delayed until January 1, 2032.
The Technology Transitions Rule, originally finalized in 2023, is one of three parts of the American Innovation and Manufacturing (AIM) Act, an HFC emissions-reduction law enacted in 2020 with bipartisan and industry support. The others are the Emissions Reduction and Reclamation (ER&R) rule and the phasedown of HFC production and imports.
The NRDC on July 20 sued the EPA over the rollback of the Technology Transitions Rule rollback in the D.C. Circuit Court of Appeals, joining five industry groups that filed similar suits: the Heating, Air-conditioning & Refrigeration Distributors International (HARDI), the Plumbing, Heating, Cooling Contractors National Association (PHCC), the Air Conditioning Contractors of America (ACCA), the Air-Conditioning, Heating, and Refrigeration Institute (AHRI) and the Alliance for Responsible Atmospheric Policy. On July 21 a coalition of 18 state attorneys general and two localities took similar legal action. These various suits have been consolidated into a single case before the court.
“it will be at least a year, probably a year and a half, before anything gets settled associated with this litigation. And even then the uncertainty does not end when the court makes its decision. If the challenges to the rule are successful, that would restore the requirements established in 2023. But EPA could then decide to reissue a new rulemaking that attempts to cure the legal violations and delay those compliance deadlines again.”
Jeremy Arling, NRDC’s Senior Fellow, Super Pollutants, Climate & Energy
At the same time, several food retail industry groups filed a motion to intervene in the consolidated suit in support of the EPA’s revised Technology Transitions Rule. These include the Retail Litigation Center (RLC), the Food Industry Association (FMI), the American Frozen Food Institute (AFFI) and the National Grocers Association (NGA), who contend that stores need additional time to transition to compliant refrigeration systems.
In an email communication with NaturalRefrigerants.com, Jeremy Arling, NRDC’s Senior Fellow, Super Pollutants, Climate & Energy, estimated that “it will be at least a year, probably a year and a half, before anything gets settled associated with this litigation.” And even then, he added, “the uncertainty does not end when the court makes its decision. If the challenges to the rule are successful, that would restore the requirements established in 2023. But EPA could then decide to reissue a new rulemaking that attempts to cure the legal violations and delay those compliance deadlines again.”
Arling’s comments followed his discussion of the EPA lawsuits on August 18 in a webinar hosted by REEF (Refrigerant Emissions Elimination Forum) called “Refrigerant Reality Check: Navigating the AIM Act & State Policy Updates.” Prior to joining NRDC, Arling worked for two decades at the EPA implementing the phaseout of ozone-depleting substances under the Clean Air Act and phasedown of HFCs under the AIM Act.
Challenging the EPA
In a blog post on July 20 three NRDC officials in the Climate & Energy sector – David Doniger, Senior Attorney and Strategist; Richie Kaur, Senior Super Pollutant Reduction Advocate; and Arling – challenged the EPA’s reasoning in its reconsideration of the Technology Transitions Rule.
Use of legacy equipment
In announcing the revamped Technology Transitions Rule at the White House, President Donald Trump “ad-libbed” that “he is saving supermarkets and grocery stores from having to rip out and replace perfectly good refrigeration systems,” the NRDC noted. However, the rule has always applied only to new or remodeled systems. Legacy equipment can be kept until it needs to be replaced.
Purported savings from the revised rule
At the White House event, Trump and EPA Administrator Lee Zeldin claimed that their actions will save $2.4 billion (€2.06 billion), spread over the next 25 years. The NRDC explained that more than half of that ($1.5 billion/€1.28 billion), is what the EPA attributes to a separate rollback that it has proposed, weakening a requirement in the ER&R rule to cut HFC leaks from refrigerated trucks.
The savings claimed for the revision of the Technology Transitions Rule would be $976 million (€836 million), the NRDC noted, an average of $39 million (€33 million) per year over the next 25 years. For a family of four, the U.S. Department of Agriculture (USDA), estimates the average monthly grocery bill is $1,018 (€872). “If you could count on supermarkets to pass the savings from the rule on to consumers, that family would save about $0.03 (€0.026) per month,” NRDC calculated.
Higher costs of the revised rule
Consumers will actually pay more for groceries as well as for fixing home ACs as a result of the revised rule because of higher refrigerant prices that stores will pay, the NRDC explained.
The AIM Act mandates a phasedown in production and imports of HFCs, currently at 60% of the baseline and dropping to 30% in 2029 and 15% in 2036. The Technology Transitions rule was intended to spur adoption of unregulated low-GWP refrigerants (notably natural refrigerants), thereby moderating demand for HFCs and protecting against HFC price spikes. By delaying adoption of lower GWP refrigerants, the EPA will not be able to prevent steeper prices of HFCs; this will also impact appliances like home air conditioners.
With the rollback of the Technology Transitions Rule, the agency anticipates that HFC demand will exceed the supply available in 2029 by 24% percent and that HFC prices will rise by another 12–24%, the NRDC noted, adding that industry analysts put the overall refrigerant cost increase at nearly $8 billion (€6.85 billion) per year. This will drive “food price increases that will swamp the savings that the White House trumpeted.”
Supermarket chains like Kroger and Piggly Wiggly that supported the revision of the Technology Transition Rule “will pay more for HFCs in their existing stores than they will save in their new and remodeled ones,” the NRDC said.
Companies that geared up for the transition
Equipment manufacturers testified to the EPA that they made investments in new refrigeration systems in reliance on the transition schedule in the 2023 rule, the NRDC noted, adding, “Now the agency is pulling the rug out from under them.” While they can continue to sell their equipment, the EPA “acknowledged that they’ll be undercut by both domestic and foreign manufacturers of old-school products that hadn’t invested in the transition.”
Harm to the climate
The EPA estimates that the revised rule will lead to HFC emission increases of 68 million metric tons of CO2e between 2026 and 2050. “This is equal to the emissions of seven natural gas power plants,” said the NRDC, adding that the extra emissions will come, in large part, from illegal imports of HFCs into the U.S.
Breaking with decades of precedent and legal requirements, the EPA refused to estimate the dollar value of the increased climate-harming emissions its rollback will cause, the NRDC noted. The Biden administration’s EPA calculated that cutting a single ton of HFC emissions produces tens of thousands to hundreds of thousands of dollars in public health, environmental and economic benefits.
But under the Trump administration’s Office of Management and Budget, all agencies have stopped calculating the benefits of cutting greenhouse gases. “So now, the EPA values the damage from each ton of extra HFC emissions at $0,” said the NRDC.
