# 2015
- 2019 Proposed HCFC



# Allocation Rule US EPA, Office of Atmospheric Programs SBA Environmental Roundtable January 31, 2014

# Today’s Presentation

• Background on the HCFC Phaseout

• How EPA Developed the Proposed Options

• Proposed HCFC
- 22 Approaches and 

## Consumption Allocation Amounts

• Other Proposals in the Rule

# Why phase out HCFCs?

• HCFCs deplete the 

### stratospheric ozone layer

• Ozone layer shields Earth 

### from ultraviolet radiation:

— Skin cancer

— Cataracts

— Weakened immune systems

— Damage to plant life, aquatic ecosystems

## How EPA Implements the HCFC Phaseout

• EPA must ensure compliance with the Montreal Protocol & Clean Air Act Title VI

– Phase out of all ozone
- depleting substances


## • Goal: smoothly transition away from HCFCs

– Focus on HCFC
- 22, it’s 90+% of HCFC use


## • EPA writes rules that issue allowances for import and production of virgin HCFCs

– Allowances decrease over time



### – No HCFC
- 22 allowances in 2020 or beyond

– Complete ban on production and import in 2030

# HCFC
- 22 phaseout timeline

• Jan. 1, 2010 : HCFC
- 22 may only be produced or imported for use in servicing and maintaining pre
2010 systems

• Jan. 1, 2015 : Allowed production/import will be at 

### least 45% below 2010 level, as required by the Montreal Protocol

• Jan. 1, 2020 : No production or import of HCFC
- 22

— Used, recovered and recycled material can still be used

— Virgin material imported or produced before Jan. 1, 2020 can still be used until 2030

# 2015 – 2019 Proposed Rule

• The 2015
- 2019 Proposed Rule has three 

## approaches for setting the amount of HCFC
- 22 consumption allowances each year

– 5
- year Linear Drawdown

– 3
- year Linear Drawdown

– Estimation Approach

# Factors Considered

• Montreal Protocol Cap


## • Clean Air Act requirements & use restrictions
• Servicing need for HCFC
- 22 equipment

– 46,000 MT modeled in 2015 (~100 million pounds)



### – Modeled need is based on publically vetted parameters (installed equipment base, leak rate, charge size, etc.)


## • Market conditions

– Existing HCFC
- 22 supply, uptake of alternatives, transition timelines, feasibility of retrofits for various 

### end uses- 5,000 10,000 15,000 20,000 25,000

2014 2015 2016 2017 2018 2019 2020 HCFC - 22 Allowances (MT) Comparison of EPA's Three Proposed Approaches for HCFC - 22 Estimation Approach (Maxmimum

Amount) 5
- year Linear Drawdown
- Preferred 3
- year Linear Drawdown

These 3 approaches are shown in Table 1 of the Proposed Rule-

5,000 10,000 15,000 20,000 25,000

2014 2015 2016 2017 2018 2019 2020 MT HCFC - 22 Consumption 5 - year Linear Drawdown Approach –

3 Allocation Options

Linear Drawdown
- Highest Linear Drawdown - Preferred Linear Drawdown
- Lowest0

5,000 10,000 15,000 20,000 25,000

2014 2015 2016 2017 2018 2019 2020 HCFC - 22 Allowances (MT) 3 - year Linear Drawdown Approach –

2 Allocation Options

Higher Starting Point Preferred- 5,000 10,000 15,000 20,000 25,000

2014 2015 2016 2017 2018 2019 2020 HCFC - 22 Allowances (MT) 

### Estimation Approach
Highest Allocation under Estimation Approach
Lowest Possible Allocation under Estimation Approach (based on EPA's proposal to account for up to 10,000 MT of existing inventory each year)0 2,000 4,000 6,000 8,000 10,000 12,000

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 ODP - weighted MT HCFC Allocation Compared to Cap

HCFC
- 22 Allocation Other HCFCs MP Cap for all HCFCs

10% of Baseline 65% of Baseline

25% of Baseline EPA’s Preferred Approach: 5
- year linear drawdown

# Also in the Proposed Rule
...
• HCFC
- 22 Production

– Maximum allowed under Protocol (~28,000 MT)

– Or, same as consumption


### • Preferred Approaches for other HCFCs

– HCFC
- 123: 2,000 MT

• Maximum allowed under Clean Air Act section 605



### – HCFC
- 124: 200 MT



### – HCFC
- 142b: 35 MT, decreasing by 5 MT each year


### • No HCFC
- 225ca/ cb allowances

– Narrow de minimus exemption to allow continued use of existing inventory by owner of the inventory