Greenhouse Gas Regulation: 2020 AIM Act and International Restrictions and Phasedowns of Hydrofluorocarbons

Calculations for Baselines, Establishments of Production and Allowance Mechanisms

This program has been cancelled

A live 90-minute CLE video webinar with interactive Q&A


Tuesday, November 9, 2021

1:00pm-2:30pm EST, 10:00am-11:30am PST


This CLE webinar will advise environmental counsel on recently issued rules on hydrofluorocarbon (HFC) regulation. The panel will discuss the calculations for baselines and establishments of production and allowance mechanisms. The panel will address the allowance system for the production and consumption of HFCs modeled on its prior success drawing down chlorofluorocarbons.

Description

Previous federal decisions ruled that the EPA could not restrict HFCs and blends containing HFCs because they could contribute significantly to global warming. Not only did the regulation limit these chemicals in refrigerants for vehicle air conditioners, coolers in groceries and other retail stores, and vending machines, it also limited their use as blowing agents that expand plastic into foam and in aerosol cans. Counsel for manufacturers and retailers of products that contain HFCs affected by the proposed phasedown face broad implications. HFCs are commonly used in air conditioning, refrigeration, fire suppression systems, foam blowing agents, and cleaning solvents, among other uses.

Allowance-based rules proposed in the American Innovation and Manufacturing Act of 2020 (AIM Act) are intended to reduce HFC "production" and "consumption" (i.e., generally manufacture and import) by 10 percent in 2022. By the time the AIM Act's phasedown is complete in 2036, those reductions will total at least 85 percent. The proposal includes numerous complex provisions, including establishing the phasedown baselines; several types of allowances; a proposed scheme for allocating allowances; rules for allowance transfers; new control requirements for the production of certain HFCs; rules on international trade; robust enforcement and compliance assurance provisions; and recordkeeping and reporting requirements.

To implement the phasedown, EPA proposes an allowanced-based system in which allowances could be used for any regulated HFC. To facilitate this inter-HFC allowance system, the rule would create a new legal concept, "exchange value equivalent" (EVe), to efficiently translate allowances between HFCs--and HFC-blends--of differing exchange value weights. The AIM Act specifies exchange values for 18 HFCs, ranging in heat-trapping potential from 53-times that of carbon dioxide (HFC-152) to 14,800-times the potency of carbon dioxide (HFC-23).

The EPA advises that it will take a strong posture regarding its enforcement priorities and will not hesitate to refer companies to enforcement personnel if it determines that they have previously failed to submit required data to the GHGRP. The EPA also intends to target any efforts to smuggle unauthorized HFCs into the country.

Listen as our expert panel discusses the future of HFC regulation under the AIM Act and how current U.S. laws intersect with cross-border regulation and enforcement. The panel will discuss best practices for compliance with proposed EPA allowances and what best evidence users of HFCs may present to the EPA before the end of the comment period.

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Outline

  1. History of HFC regulation and case law
  2. American Innovation and Manufacturing Act of 2020 (AIM Act)
    1. Allowance allocation
    2. Impact date of use and need by manufacturers
    3. Baseline phasedown
    4. Enforcement and compliance
    5. Environmental justice
    6. Costs and benefits

Benefits

The panel will review these and other relevant topics:

  • How did the prior holding in Mexichem Fluor Inc. v. EPA impact HFC regulation since 2017?
  • What are the major points of regulation of HFCs under the AIM Act?
  • What are the allowance measurements for HFCs under the AIM Act?
  • How is the AIM Act affected by the Montreal Protocol?

Faculty

Broome, Shannon
Shannon S. Broome

Partner; California Environmental Practice Group Leader
Hunton Andrews Kurth

Ms. Broome’s prior experience as a chemical engineer in the oil and gas industry affords her unparalleled...  |  Read More

Pilchen, Zachary
Zachary (Zach) Pilchen

Attorney
Beveridge & Diamond

Mr. Pilchen serves as the Deputy Chair of the firm’s Air & Climate Practice Group. He joined B&D from...  |  Read More