# Technical Support

**Document Analysis of the Economic Impact and**  **Benefits of Proposed Revisions to the National Recycling and Emission Reduction**  **Program**

October 15 , 201 5

U.S. Environmental Protection Agency Stratospheric Protection Division Office of Atmospheric Programs 1200 Pennsylvania Avenue, NW Washington, DC 20460

## bl**ank page** iii October 15, 2015



# Contents **Executive Summary ................................**  **................................ ................................**  **.......................... vii**  **1. Introduction**  **................................ ................................**  **................................ ................................**  **1** 1.1. Regulatory Context ................................ ................................ ................................ ....................... 3 1.1.1. Profile of Regulated Community ................................ ................................ ..................... 3 1.1.2. Current Leak Repair Requirements ................................ ................................ ................. 3 1.1.3. Current Recordkeeping and Reporting Requirements ................................ .................... 4 1.2. Proposed Regulatory Revisions ................................ ................................ ................................ .... 6 1.2.1. Proposed Changes to the Leak Repair Requirements ................................ ..................... 6 1.2.2. Proposed Changes to the Recordkeeping and Reporting Requirements ........................ 7 1.2.3. Other Proposed Regulatory Revisions ................................ ................................ ............. 8 1.3. Organization of This Report ................................ ................................ ................................ .......... 8 **2. Industry Characterization**  **................................ ................................**  **................................ ...........**  **10** 2.1. Affected Industry for Leak Inspection and Repair Requirements ................................ .............. 10 2.1.1. Equipment Characterization ................................ ................................ .......................... 10 2.1.2. Industry Characterization ................................ ................................ .............................. 14 2.2. Affected Industry for Recordkeeping and Reporting Requirements ................................ .......... 20 2.3. Affected Industry for Self
- sealing Valves on DIY Small Cans ................................ ...................... 22 **3. Methodology**  **................................ ................................**  **................................ .............................**  **23** 3.1. Approach for Estimating Aggregate Annual Costs to the U.S. Economy ................................ .... 24 3.1.1. Leak Inspection and Repair ................................ ................................ ............................ 24 3.1.2. Recordkeeping and Reporting ................................ ................................ ....................... 34 3.1.3. Self
- sealing Valves on DIY Small Cans ................................ ................................ ............ 39 3.1.4. Extending Other Existing Requirements to HF Cs and Other Substitutes: Implications for Costs ................................ ................................ ................................ ......................... 39 3.2. Approach for Estimating the Economic Impact on Small Entities ................................ .............. 42 3.2.1. Leak Inspection and Repair Model Facility and Entity Assumptions ............................. 42 3.2.2. Reporting and Recordkeeping ................................ ................................ ....................... 44 3.2.3. Self
- sealing Valves on DIY Small Cans ................................ ................................ ............ 45 3.3. Approach for Estimating Benefits ................................ ................................ ............................... 45 3.3.1. Emission Reduction Benefits of Leak Inspection and Repair ................................ ......... 45 3. 3.2. Emission Reductions Benefits of Installing Self
- sealing Valves on Small Cans .............. 48 3.3.3. Extending Other Existing Requirements to HFCs and Other Substitutes: Implications for Benefits ................................ ................................ ................................ .................... 50 **4. Aggregate Economic Impact Analysis**  **................................ ................................**  **.......................... 51**  4.1. Annual Compliance Costs ................................ ................................ ................................ ........... 51 4.2. Annual Refrigerant Savings ................................ ................................ ................................ ......... 52 4.3. Annual Emission Reduction Benefits ................................ ................................ .......................... 53 4.4. Looking Forward: Emission Reduction Benefits in 2020 and 2025 ................................ ............ 53 4.5. Other Benefits ................................ ................................ ................................ ............................. 54 **5. Small**  **Entities Impact Analysis ................................**  **................................ ................................**  **.... 56**  5.1. Decision Matrix for Determining Significant Economic Impact on a Substantial

Number of Small En tities ................................ ................................ ................................ .. 56 5.2. Aggregate Small Business Impacts of Proposed Regulatory Changes ................................ ........ 57iv October 15, 2015



### 6. **Statutory and Executive Order Impact Analyses ................................**  **................................ ..........**  **60 7.**  **Conclusions ................................**  **................................ ................................**  **............................... 61**  **8. References**  **................................ ................................**  **................................ ................................**  **. 62**  **Appendix A. Sensitivity Analyses for Aggregate Economic Analysis ................................**  **.................. A** **- 1**  **Appendix B. Detailed Tables for Recordkeeping and Reporting ................................**  **........................ B**  **- 1**  **Appendix C. Detailed Tables for SISNOSE Analysis ................................**  **................................ ...........**  **C -**  **1 Appendix D. Sensitivity Analysis for SBREFA**  **................................ ................................**  **................... D** **- 1**  **Appendix E. NAICS Codes ................................**  **................................ ................................**  **................ E**  **- 3**  **Appendix F. Costs Incurred by DIYers for a Sales Restriction ................................**  **........................... F** **- 14**  

# Tables Table 1. Summary of EPA’s Proposed Changes to Section 608 Regulations by Rule

Component ................................ ................................ ................................ ................................ . vii Table 2. Industries Affected by the Proposed Regulatory Changes by Rule Component ............................. x Table 3. Existing Annual Leak Rates by Appliance Type ................................ ................................ ................ 4 Table 4: Equipment Characterization by Sector, Type, Size, and Refrigerant Type ................................ .... 12 Table 5: Typical Refrigerants Used by Equipment Type ................................ ................................ ............. 13 Table 6: Typical Cha rge Size Categories by Equipment Type ................................ ................................ ...... 13 Table 7: Industry Sector, NAICS Code, and Definition ................................ ................................ ................ 14 Table 8: Total Businesses and Facilities by Industry Category ................................ ................................ .... 17 Table 9: Percentage of Industry Containing Appliances with 50 or More Pounds of ODS

or HFC Refrigerant, and Average Number of Systems per Facility ................................ ........... 18 Table 10: Universe of Affected Equipment ................................ ................................ ................................ . 20 Table 11. Total Number of Small Entities Affected by Industry Category and NAICS Code ....................... 21 Table 12 : Industry Characterization for Small Can Manufacturers Affected by Proposed

Rule ................................ ................................ ................................ ................................ ............ 22 Table 13: Leak Repair Outcomes and Proportio ns ................................ ................................ ..................... 27 Table 14: Leak Rate Assumptions by Equipment Sector, Type, and Size ................................ .................... 28 Table 15: Unit Cost Assumptions ................................ ................................ ................................ ................ 31 Table 16. Leak Rate Comparison Based on California’s RMP and EPA’s Vintaging Model ......................... 33 Table 17: Affected Equipment Assumptions by Equipment Sector, Type, Size, and

Refrigerant Type ................................ ................................ ................................ ........................ 33 Table 18. Appliances with Charge Sizes Between 5 and 50 Pounds Disposed in 2015 .............................. 38 Table 19: Regulatory Cha nges Assumed to Present No Incremental Cost ................................ ................. 40 Table 20. Potentially Affected Industries for Reporting and Recordkeeping Requirem ents ...................... 44 Table 21: Average GWP and ODP Assumptions by Equipment Type, Size, and Refrigerant

Type ................................ ................................ ................................ ................................ ........... 46 Table 22. Annual Compliance Costs by Rule Component (2014$)
................................ .............................. 51 Table 23. Total Annual Refrigerant Savings (2014$), Compliance Costs, and Combined

Annual Compliance Costs and Refrigerant Savings ................................ ................................ ... 52 Table 24. Annual GHG and ODS Emissions Avoided in 2015 ................................ ................................ ...... 53 Table 25. Annual GHG Emissions Avoid ed in 2020 (MTCO 2 

### eq.) ................................ ................................ . 53v October 15, 2015



### Table 26. Annual GHG Emissions Avoided in 2025 (MTCO 2 

### eq.) ................................ ................................ . 54 Table 27. Annual ODS Emissions Avoided in 2020 and 2025 (ODP
-weighted MT) ................................ ..... 54 Table 28. Decision Matrix for Certifying SISNOSE ................................ ................................ ....................... 56 Table 29. Summary of the Small B usiness Impact ................................ ................................ ...................... 57 Table 30. Aggregated Economic Impacts on Small Businesses ................................ ................................ ... 59 Table 31: Annual Compliance Costs and Total Annual Refrigerant Savings (2014$) with

CARB ODS and HFC Equipment Distribution ................................ ................................ ............ A- 1 Table 32: . Annual GHG and ODS Emissions Avoided with CARB ODS and HFC Equipment

Distribution ................................ ................................ ................................ .............................. A- 2 Table 33: Annual Compliance Costs and Total Annual Refrigerant Savings (2014$) with

200 - pound Annual Leak Inspection Threshold ................................ ................................ ......... A- 3 Table 34: Annual Compliance Costs and Total Annual Refrigerant Savings (2014$) with

Higher Post
- Repair Leak Rate ................................ ................................ ................................ ... A-4 Table 35: . Annual GHG and ODS Emissions Avoided with Higher Post
- Repair Leak Rate ........................ A-4 Table 36: Annual Compliance Costs and Total Annual Refrigerant Savings (2014$) with

3% Discount Rate ................................ ................................ ................................ ..................... A- 5 Table 37: Annual Compliance Costs and Total Annual Refrigerant Savings (2014$) with 2
-

week Leak Repair Improvement ................................ ................................ .............................. A- 6 Table 38: . Annual G HG and ODS Emissions Avoided with 2
-week Leak Repair

Improvement ................................ ................................ ................................ ............................ A- 7 Table 39: Annual Compliance Costs and Total Annual Refrigera nt Savings (2014$) with

2 - month Leak Repair Improvement ................................ ................................ ......................... A- 8 Table 40: . Annual GHG and ODS Emissions Avoided with 2
- month Leak R epair

Improvement ................................ ................................ ................................ ............................ A- 9 Table 41: Annual Compliance Costs and Total Annual Refrigerant Savings (2014$) with

Lower Threshold Leak Ra tes ................................ ................................ ................................ .. A- 10 Table 42: Annual GHG and ODS Emissions Avoided with Lower Threshold Leak Rates .......................... A- 11 Table 43: Annual Compliance Costs and Total Annual Refrigerant Savings (2014$) with

Higher Threshold Leak Rates ................................ ................................ ................................ .. A- 12 Table 44: Annual GHG and ODS Emissions Avoided with Higher Threshold Leak Rates ......................... A- 13 Table 45. Annual Compliance Costs for Recordkeeping and Reporting ................................ .................... B - 1 Table 46: Estimated Number of Small Businesses Affected by NAICS Code ................................ ............. C- 1 Table 47. Aggregated Economic Impacts on Small Businesses with 3% Discount Rate ........................... D - 1 Table 48: NAICS Codes Included in the Leak Repair Regulation Analysis ................................ .................. E - 3 Table 49: NAICS Codes Included in the Small
- can Analysis ................................ ................................ ..... E - 13 Table 50: NAICS Codes Included in the Recordkeeping and Reporting Requirements

Analysis ................................ ................................ ................................ ................................ ... E - 13 Table 51. Costs Incurred by DIYers to Take Vehicle to a Professional Service Shop ............................... F - 14 Table 52. Costs Incurred by DIYers to Become a 609 Certified Technician ................................ ............. F - 14vi October 15, 2015 

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# Executive Summary Under t he National Recycling and Emission Reduction Program, found at Section 608 of the Clean Air Act (40 CFR part 82, subpart F), EPA has establish ed standa rds and regulations for the use and disposal of ozone - depleting substances (ODS) during the maintenance, service, repair, or disposal of air
conditioning and refrigeration appliances. EPA is proposing to extend, as appropriate, the existing requirements in subpart F that currently apply to ozone
- depleting refrigerants to non
- ozone - depleting substitute refrigerants, such as hydrofluorocarbons (HFCs). Further, EPA is proposing to revise Section 608 rule components associated with leak repair; recordkeeping an d reporting, and the refrigerant sales restriction. EPA’s proposed changes to Section 608 are summarized in Table 1 below by rule component. **Table 1**  **. Summary of EPA’s Proposed Changes to Section 608 Regulations by Rule Component Rule Component**  **Proposed Change** Leak Inspection and Repair  Extend the existing requirements to comfort cooling (CC), commercial refrigeration (CR), and industrial process refrigeration (IPR) equipment containing 50 or more pounds of HFC and other substitute refrigerant ;  Lower the annual leak rates for CC, CR, and IPR equipment containing 50 or more pounds of ODS, HFC, or other substitute refrigerant ;  Require periodic leak inspections for equipment containing 50 or more pounds of ODS, HFC, or other substitute refrigerant ;  Establish a leak limit where an appliance is prohibited from leaking more than 75% of its full charge in two consecutive years ;  Requ ire initial and follow
- up verification tests for all appliances (i.e., IPR, CR, and CC equipment) when the applicable leak rate is exceeded ;  Require a leak inspection to identify leaks upon discovering that the applicable leak rate is exceeded;  Require tha t all identified leaks are repaired when the applicable leak rate is exceeded rather than just bringing the leak rate down below the annual leak rate threshold;  Allow leak repair extension requests for all equipment, including non -federal CR and CC systems ; and  Explicitly allow (and even encourage ) electronic instead of paper records.viii October 15, 2015

**Rule Component Proposed Change**  Recordkeeping and Reporting  Extend the current recordkeeping and reporting requirements to appliances containing HFCs and other non
- exempt substitutes ;  Al low owners/operators of all ODS, HFC, and other substitute refrigerant
containing appliances with charge sizes of 50 or more pounds to prepare and submit requests for extensions to the leak repair and retrofit/retire timeline ;  Require persons servicing ODS, HFC, and other su bstitute refrigerant
- containing appliances with charge sizes of 50 or more pounds to provide records of the following for each refrigerant addition: the identity and location of the appliance, the date and type of service performed, the quantity and type o f refrigerant added, the full charge of the system, and the leak rate ;  Require owners/operators of ODS, HFC, and other substitute refrigerant
containing appliances with charge sizes of 50 or more pounds to maintain records of the following for each refrig erant addition: the identity and location of the appliance, the date and type of service performed, the quantity and type of refrigerant added, the full charge of the system, and the leak rate ;  Require owners/operators of ODS, HFC, and other substitute refrigerant containing appliances with charge sizes of 50 or more pounds to maintain reports on the results of verification tests and leak inspections any time the leak rate threshold is exceeded ;  Require owners/operators of ODS, HFC, and other substitute refrigerant containing appliances with charge sizes of 50 or more pounds to maintain records of quarterly and annual leak inspections ;  Require technicians disposing of field
- installed appliances with charge sizes between 5 and 50 pounds to maintain records on the quantity and types of refrigerant recovered at disposal and the quantity and type of refrigerant transferred for reclamation or destruction, as well as the company name and date ;  Require approved technician certifying programs to publish online lists or databases documenting who they have certified and what type of certification each individual has received ;  Require manufacturers of small cans of automotive refrigerant to keep records of test data and log forms that demonstrate compliance with the allo wable leakage rate ; and  Remove the requirement for persons who maintain, service, repair, or dispose of appliances containing ODS refrigerants to submit a signed statement that they own certified recovery and recycling equipment. Refrigerant Sales Restri ction  Extend the sales restriction to HFCs and other non
- exempt substitutes ;  Exempt small cans of HFC refrigerant that are used for DIY aftermarket servicing of M VACs from the sales restriction; and  Require self
- sealing valves on small cans of substitute refrigerant .ix October 15, 2015

**Rule Component Proposed Change**  Other  Extend all other the regulatory requirements found at 40 CFR part 82, subpart F, including technician certification, appliance disposal, reclamation, service practices, and the requirement to recover refrigerant to HFCs and other non
exempt substitutes; and  Require substitute
- containing recycling/recovery equipment to be certified. 

### The purpose of this report is to present the results of a costs and benefits assessment to assist EPA in evaluating the impacts of the proposed changes to Section 608 regulations and satisfying its obligations under relevant statutes and Executive Orders (EOs), including EO 12866 : Regulatory Planning and Review, the Regulatory Flexibility Act (RFA) as amended by the Small Business Regulatory Enforcement Fai rness Act (SBREFA) , and the Unfunded Mandates Reform Act (UMRA) of 1995. This report was developed with support from ICF International. 

## General Approach Below is a summary of the general approach used to estimate the impact of the proposed regulatory changes associated with each major rule component. A list of potentially affected industry sectors by major rule component is presented in Table 2 .  

### Leak inspection and repair. To estimate the impact of the proposed regulatory changes associated with leak inspection and repair to the U.S. economy as a whole and individual small business es, this analysis uses a model entity approach. The model entity approach is built up from a model facility analysis, which was developed based on assumptions about model equipment. First, the impacts were estimated for each type of affected equipment. The n, impacts were estimated for a model facility in each of the industry categories presented in Table 2 . Assumptions about the number and type of equipment used per mo del facility varied based on the industry category. Lastly, impacts per model facility were scaled to a model entity based on the average number of facilities an entity is estimated to have in each industry category.  

### Reporting and recordkeeping. To estima te the impact of the proposed regulatory changes associated with recordkeeping and reporting, the estimated burden (hours) w as multiplied by the assumed average hourly administrative cost of labor plus overhead for a private firm (hourly wage rate). Additi onal details regarding the estimated recordkeeping and reporting burden are found in the supporting statement for the Information Collection Request accompanying this proposed rule.  

### Refrigerant sales restriction. To estimate the impact of requiring self
- se aling valves on small cans of automotive refrigerant for MVAC servicing, the total number of small cans sold annually in the United States was multiplied by the cost per self
- sealing valve. To estimate impacts on small businesses, industries potentially affected by these regulatory options were primarily identified by North American Industry Classification System (NAICS) codes . Small businesses in each affected industry were classified as such based on size definitions established by thex October 15, 2015



### Small Business Admi nistration. Economic impacts on affected small businesses were calculated using a direct compliance cost method. The “sales test” was applied by estimating annualized compliance costs for affected small businesses as a percentage of those businesses’ annua l sales.

**Table 2**  **. Industries Affected by the Proposed Regulatory Changes by Rule Component Rule**  **Component Industry Category**  **NAICS Codes**  **NAICS Code Definition** Leak Inspection and Repair; Reporting and Recordkeeping Agriculture and Crop Support

Services 115 Support Activities for Agriculture and Forestry Arts, Entertainment, and Recreation 71 Arts, Entertainment, and Recreation Beverage and Ice Manufacturing 312 Beverage Manufacturing Durable Goods Wholesalers and Dealers 423 Merchant Wholesalers
- Durable Goods 441 Motor Vehicle and Parts Dealers Educational Services 611 Educational Services Food manufacturing 311 Food manufacturing General Merchandise Stores 452 General Merchandise Stores 453998 All Other Miscellaneous Store Retailers (except Tobacco Stores) Grocery and Specialty Food Stores 4451 Grocery Stores 4452 Specialty Food Stores 72231 Food Service Contractors Hospitals 622 Hospitals Non - durable Goods Wholesalers and Dealers 424 Merchant Wholesalers – Non - d urable Goods Non -food Manufacturing 322 Paper Manufacturing 323 Printing and Related Support Activities 324 Petroleum Manufacturing 325 Chemical Manufacturing 3254 Pharmaceutical Manufacturing 326 Plastics and Rubber Manufacturing 332 Metals Manufacturing 333 Machinery Manufacturingxi October 15, 2015

**Rule Component**  **Industry Category NAICS**  **Codes NAICS Code Definition**  334 Computer and Electronic Product Manufacturing 336 Transportation Equipment Manufacturing 3391 Medical Equipment and Supplies Manufacturing 339999 Miscellaneous Manufacturing Office Buildings 511 Publishing Industries (except Internet) 512 Motion Picture and Video Industries 515 Broadcasting 517 Telecommunications 518 Data Processing, Hosting, and Related Services 519 Libraries and Archives 522 Credit Intermediation and Related Activities 524 Insurance Carriers 531 Real Estate 541 Professional, Scientific, and Technical Services 551 Management of Companies and Enterprises 561 Administrative and Support Services 712 Museums, Historical Sites, and Similar Institutions 721 Accommodation 813 Religious, Grantmaking, Civic, Professional, and Similar Organizations Other Warehousing, Storage, and Transportation 48 Transportation and Warehousing 4931 Warehousing and Storage Refrigerated Warehousing and Storage 49312 Refrigerated Warehousing and Storage Research and Development 5417 Research and Development Utilities 2 1 1 Oil and G as E xtraction 2 2 1 Utilities Warehouse Clubs and Supercenters 452910 Warehouse Clubs and Supercenters Recordkeeping Reclaimers 325120 Industrial Gas Manufacturingxii October 15, 2015

**Rule Component**  **Industry Category NAICS**  **Codes NAICS Code Definition**  and Reporting 423930 Recyclable Material Merchant Wholesalers 562920 Materials Recovery Facilities 562212 Solid Waste Landfill 424690 Other Chemical and Allied Products Merchant Wholesalers Refrigerant Wholesalers 325120 Industrial Gas Manufacturing 424690 Other Chemical and Allied Products Merchant Wholesalers 42 Wholesale Trade Service Technicians 238220 Plumbing, Heating, and Air- conditioning C ontractors Disposal Establishments 562920 Materials Recovery Facilities 562212 Solid Waste Landfill 423990 Other Miscellaneous Durable Goods Merchant Wholesalers Service Establishments 811310 Commercial Industrial Machinery and Equipment (not Automotive and Electronic) Repair and Maintenance 811412 Appliance Repair and Maintenance Refrigerant Sales Restriction ; Recordkeeping and Reporting Small Can Manufacturers 441310 Automotive Parts and Accessories Stores 325120 Industrial Gas Manufacturing 

## Summary of Results: Costs and Benefits Total annual compliance costs for EPA’s proposed rulemaking are estimated to be $ 6 2–66 million , with a best estimate of $63 million
. 1 

### This estimate includes annual compliance costs associated with the proposed rulemaking, as well as avoided compliance costs associated with the proposed removal of some existing regulatory requirements and the provision of additional flexibility that are expected to reduce regulatory burden. The proposed rulemaking is also expected to result in approximately $5 2 million in savings associated with reduced use of ODS and HFC refrigerant.

1 2014$, using a 7% discount rate. Compliance costs using a 3% discount rate are estimated at $83 million.xiii October 15, 2015



### Total annual greenhouse gas ( GHG ) emissions avoided associated with the proposed regulatory changes has a best estimate of 7.5 MMTCO 2 

### eq. Total ODS emissions avoided are estimated at 1 16 ODP -weighted MT. T his screening analysis finds that the proposed rulemaking can be presumed not to have a significant economic impact on a substantial number of small ent ities (SISNOSE) . In total, an estimated 9 50, 5 00 small businesses may be subject to the proposed regulatory actions. A bout 944,000 small businesses (99%) are expected to incur compliance costs as a result of this rulemaking that are less than 1% of annual s ales. Approximately 1 5 0 affected small businesses — or less than 0.0 2 % — could incur costs in excess of 1% of annual sales, and fewer than 8 0 small businesses — or less than 0.01% — could incur costs in excess of 3% of annual sales. These estimates are below the thresholds for a substantial number determination under the RFA.1 October 15, 2015



# 1. **Introduction** Section 608 of the Clean Air Act (CAA) Amendments of 1990, also known as the National Recycling and Emission Reduction Program (the Program), provides authority for the U.S. E nvironmental P rotection Agency’s (EPA) regulations governing the use of ozone
- depleting substances (ODS), including chlorofluorocarbons (CFCs) and hydrochlorofluorocarbons (HCFCs), during the mainte nance, service, repair, or disposal of air
- conditioning and refrigeration equipment. The purpose of the Program is to: (1) prohibit any person from intentionally venting ODS refrigerants and their substitutes, such as HFCs, into the environment; (2) reduce the use and emissions of refrigerants; (3) maximize the recapture and recycling of refrigerants; and (4) ensure safe disposal of refrigerants . To this end, regulations established under 40 CFR p art 82, s ubpart F:
 

### Prohibit knowingly vent ing or otherwise re leas ing into the environment any refrigerant, including substitutes for ODS, while maintaining, servicing, repairing, or disposing of appliances .  

### Require service practices that maximize recovery and recycling of ODS (both CFCs and HCFCs and their blends) d uring the servicing and disposal of air
- conditioning and refrigeration equipment.  

### Set certification requirements for refrigerant recycling and recovery equipment, technicians, and refrigerant reclaimers.  

### Generally restrict the sale of ODS refrigerant to certified technicians.  

### Require used ODS refrigerant to be reclaimed to certain purity standards before being resold.  

### Require persons servicing or disposing of air
- conditioning and refrigeration equipment containing a n ODS to certify to EPA that they have acquired refrigerant recovery and/or recycling equipment and are complying with the requirements of the rule.  

### Require the repair of s ignificant leaks in air
- conditioning and refrigeration equipment containing more th an 50 pounds of an ODS refrigerant .  

### Establish safe disposal requirements to ensure removal of ODS refrigerants from goods that enter the waste stream with the charge intact (e.g., motor vehicle air conditioners, home refrigerators, and room air conditione rs).  

### Require reporting and recordkeeping for technicians; technician certification programs; equipment testing organizations; refrigerant wholesalers and purchasers; refrigerant reclaimers; refrigeration and air
- conditioning equipment owners/operators ; and other establishments that perform refrigerant removal, service, or disposal.  

### Take enforcement actions against any violation of these regulations. While these regulations significantly reduce emissions of refrigerants, the current requirements do not in clude specific requirements for substitute refrigerants other than prohibit ing venting . To help minimize the harm that both ODS and substitute refrigerants have on the environment and to fully implement the prohibition on venting, EPA is considering exten d ing the existing requirements under the Program to cover substitute s, and revising the rule components associated with leak repair, as well as2 October 15, 2015



### recordkeeping and reporting, to reduce refrigerant emission s . Further, EPA is considering a new requirement to re duce emissions associated with Do
- It -Yourself (DIY) motor vehicle air
- conditioning (MVAC) re
- charging where manufacture rs must install a self
- sealing valve on all small containers to prevent the release of refrigerant to the atmosphere. The purpose of thi s report is to document the results of a costs and benefits assessment that was conducted to help EPA evaluate the impact of the proposed revisions to Section 608 regulations . Further, this report provides information to assist EPA in satisfying its obliga tions under relevant statutes and Executive O rders (EOs), including: EO 12866 Regulatory Planning and Review; the Regulatory Flexibility Act (RFA); and the Unfunded Mandates Reform Act (UMRA). **EO 12866 : Regulatory Planning and Review** **.** EO 12866 requires ag encies to prepare a Regulatory Impact Analysis (RIA) for any “significant regulatory action,” which includes any regulatory action that is likely to result in a rule that may:
 

### Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities;  

### Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency;  

### Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or  

### Raise novel legal or policy issues arising out of legal mandates, the Pre sident’s priorities, or the principles set forth in EO 12866. **UMRA.** Under Title II, section 202 of the UMRA, each agency is generally required to prepare a written statement for any proposed rulemaking that may result in the expenditure by State, local, an d tribal governments (SLTG), in the aggregate, or by the private sector, of $100 million or more in any one year. The written statement must include an assessment of the anticipated costs and benefits of the Federal mandate, a description of the macro
-econ omic effects, and a summary of SLTG concerns and how they were addressed. **RFA.** The RFA, as amended by the Small Business Regulatory Enforcement Fairness Act (SBREFA), requires federal agencies to consider the effects its regulations may have on small entities, and ensure that small entities have a voice in the regulatory development process. Under the RFA, small entities include :
 

### Small businesses, which are defined by size standards established by under the North American Industry Classification System (NAICS) and are based on the number of employees or annual receipts;  

### Small governments, which are defined as the government of a city, county, town, township, village, school district, or special district with a population of less than 50,000; and3 October 15, 2015

 

### Small organizations, which are defined as any “not
-for
- profit enterprise which is independently owned and operated and is not dominant in its field.” If it is found that the rule may impose a significant economic impact on a substantial number of small entities ( SISNOSE) , the a gency will generally be required to prepare a formal analysis of the potential adverse economic impacts on small entities, participate in a Small Business Advocacy Review Panel in the proposed rule stage, and prepare a Small Entity Complianc e Guide in the final rule sta g e. As required by abovementioned EOs and statutory requirements, this report provides a screening analysis to assess the potential impacts of the proposed changes to the U.S. economy as a whole, SLTGs, children, minority and l ow- income populations, and small entities. This analysis finds that the proposed rulemaking will result in total annual compliance costs of approximately $ 6 3 million , and therefore, is not considered a n economically significant regulatory action as defined in EO 12866. Further, this analysis finds that the proposed rulemaking can be presumed to have no SISNOSE. 

# 1.1. **Regulatory Context**  The following sections provide an overview of the affected industries, current regulations, and proposed changes to the current regulations. 

## 1.1.1. **Profile of Regulated Community**  The proposed updates to the Section 608 regulations apply to a wide variety of industries across the U.S. economy. The new leak inspection and updated repair requirements regulate equipment used for commercial refrigeration (CR), industrial process refrigeration (IPR), and comfort cooling (CC) containing 50 or more pounds of refrigerant. This regulated equipment is owned by many industries and business sectors, including grocery and specialty food stores, warehou se clubs and supercenters, agricultural and crop support services, utilities, food and non
-food manufacturing, beverage and ice manufacturing, office buildings, hospitals, and others. The reporting and recordkeeping requirements affect these business secto rs as well as : refrigerant reclaimers ; disposal establishments; plumbing, heating, and air
conditioning contractors ; service establishments; and refrigerant wholesalers. Lastly, the requirements for DIY small containers affect manufacturers of those contai ners, including automotive parts and accessories stores and industrial gas manufacturers. 

## 1.1.2. **Current Leak Repair Requirements** The current leak repair regulations require that when an owner or operator of a regulated appliance discovers that ODS refrigerant is leaking at a rate that would exceed the applicable annual leak rate during a 12
- month period, the owner or operator must take corrective action to repair the leak. Table 3 below shows the current annual leak rates for each appliance type.4 October 15, 2015 

### Table **3 .**  **Existing Annual**  **Leak Rates by Appliance Type Appliance Type**  **Annual Leak Rate**  CR 35% IPR 35% CC 15% All other appliances 15% 

### Appliances classified as CR or IPR with a charge size greater than 50 pounds of ODS refrigerant must be repaired within 30 days of discovering a leak that would result in the release of 35% or more of the charge over a 12
- month period. All other appliances with a charge size greater than 50 pounds of ODS refrigerant must be repa ired within 30 days of discovering a leak that would result in the release of 15% or more of the charge over a 12
- month period. Alternatively, owners or operators of appliances that exceed the annual leak rate may opt to develop a retrofit/retirement plan within 30 days of leak discovery and complete actions under that plan within 12 months. The deadlines for repair and retrofit/retirement may be extended in some cases such as when the necessary repair parts are unavailable, other applicable regulations make a repair within the required timeframe impossible, or an industrial process sh utdown is required to make necessary repairs. IPR equipment owners or operators are also required to verify the success of repairs. Specifically, an initial verification test must be completed after any repairs and before the replacement of the refrigeran t in the system. A follow
- up verification test must be conducted within 30 da ys after the initial verification test or of bringing the system back to normal operation . If the initial or follow
- up verification indicates that the repair was unsuccessful, the owner or operator is required to notify EPA and develop a retrofit or retirement plan within 30 days of the failed test. The requirement to retire or retrofit the leaking equipment may be avoided if the leak is successfully repaired within the allotted ti me period , as demonstrated by an initial and follow
- up verification tests . If the repair requires an industrial process shutdown, a 120
- day repair period is allowed. 

## 1.1.3. **Current Recordkeeping and Reporting Requirements** To facilitate compliance with and enforcement of S ection 608 regulations, EPA requires reporting and recordkeeping of relevant entities such as owners/operators o f regulated equipment and service technicians . The recordkeeping requirements and periodic sub mission of reports occur on an annual, biannual, one
-time, or occasional basis depending on the nature of the reporting entity and the length of time that the entity has been in service. Specific recordkeeping requirements for affected entities only cover appliances with ODS refrigerants and include the following:
 

### Programs certifying technicians must maintain records on each technician certified through their programs and display a copy of EPA’s approval letter at their place of business .5 October 15, 2015

 

### Anyone selling or distributing or offer ing to sell or distribute previously
- used or virgin refrigerant must retain invoices that indicate the name of the purchaser, the date of sale, the quantity, and that the purchaser is a certified technician (as applicable) .  

### Approved refrigerant recovery/recycling equipment testing organizations must maintain records of refrigerant recovery/recycling equipment testing and performance and refrigerant recovery/recycling equ ipment that meets EPA standards .  

### Approved technician certifying programs must maintain records that include, but are not limited to, the names and addresses of all individuals taking the tests, the scores of all certification tests administered, and the dates and locations of all testing administered .  

### Technicians must maintain proof that they are certifi ed.  

### Refrigerant reclaimers must maintain records on the quantity of material sent to them for reclamation , the amount reclaimed, waste products from the reclamation process, and customer and sales records .  

### Disposers of refrigeration and air
- conditioning equipment must maintain copies of signed statements attesting that the refrigerant has been removed prior to final disposal of each appliance .  

### Anyone servicing appliances normally containing 50 or more pounds of refrigerant must provide service invoices to the owner or operator .  

### Owners or operators of appliances normally containing 50 or more pounds of refrigerant must keep records of the amounts of refrigerant purchased and added to their appliances, a s well as service records provided by technicians and other reports related to the leak repair requirements (e.g., retrofit/retirement plans, full charge calculation)
.  

### Owners or operators of appliances normally containing 50 or more pounds of refrigerant m ust maintain information on purged and destroyed refrigerant.  

### Owners of refrigerant recovery equipment must certify that they have acquired and will properly use such equipment. Periodic reports include the following:
 

### Approved technician certification programs must submit biannual reports on their pass/fail rates and t he next year’s testing schedule .  

### Approved equipment testing organizations must submit to EPA within 30 days of the certification of a new model line of recycling or recovery equipment the na me of the manufacturer and the name and/or serial number of the model line
.  

### Approved technician certification programs that stop providing the certification test must forward all records to another program currently approved by EPA, who then must inform EP A of the transferred records.6 October 15, 2015

 

### Approved technician certification programs that have had their certification revoked must forward all records to EPA.  

### Approved refrigerant recovery/recycling equipment testing organizations must submit an annual list of refrigerant recovery/recycling equipment that meet EPA standards and must notify EPA whenever a model of refrigerant recovery/recycling equipment fails a three
-year recertification test .  

### Refrigerant reclaimers must submit annual reports noting the mass of refrig erant reclaimed by refrigerant type and the mass of waste products produced .  

### Owners of IPR equipment whose appliances fail a verification test and owners of IPR appliances and federally
-owned CR and CC appliances who wish to receive an extension or exclusion under the leak repair requirement are subject to additional reporting and recordkeeping requirements. 

# 1.2. **Proposed Regulatory Revisions** EPA is proposing to revise select components of the current regula tory requirements under Section 608, including leak repair and recordkeeping and reporting. These changes are further described in the sub
sections below. 

## 1.2.1. **Proposed Changes to the**  **Leak Repair Requirements** EPA is proposing to change the leak repair requireme nts for CC, CR, and IPR appliances normally containing 50 or more pounds of ODS refrigerant. Specifically, EPA is proposing to:
 

### Extend the existing requirements to CC, CR, and IPR appliances containing 50 or more pounds of HFC and other substitute refrigerant, excluding those that are exempt from the venting prohibition (e.g., CO 2

### , ammonia) 2


### .  

### Lower the annual leak rates from 35% to 20% for IPR and CR appliances containing 50 or more pounds of ODS, HFC, or other non - exempt substitute refrigerant .  

### Lower the annual leak rates from 15% to 10% for CC appliances containing 50 or more pounds of ODS, HFC, or other non -exempt substitute refrigerant .  

### Require quarterly leak inspections for CR and IPR appliances containing 500 or more pounds of ODS, HFC, or other non - exempt substitute refrigerant (unless automatic leak detection equipment is installed and certified every year) .  

### Require annual leak inspections for all CC appliances, plus CR and IPR appliances containing between 50 - 500 pounds of ODS, HFC, or other substit ute refrigerant (unless automatic leak detection equipment is installed and certified every year) .

2 EPA is using the term “non
- exempt substitute” to refer to substitute refrigerants that have not been exempted from the venting prohibition under CAA section 608(c)(2) and 40 CFR 82.154(a).7 October 15, 2015

 

### Establish a leak limit where an appliance is prohibited from leaking more than 75% of its full charge in two consecutive years (e.g., a facility leaks 80% in one year, and 76% the following year) .  

### Require initial and follow
- up verification tests for all appliances (i.e., IPR, CR, and CC equipment) when the applicable leak rate is exceeded .  

### Require a leak inspection to identify leaks upon discovering that the applicable leak rate is exceeded;  

### Require that all identified leaks are repaired when the applicable leak rate is exceeded rather than just bringing the leak rate down below the annual leak rate threshold .  

### Allow leak repair extension requests for all appliances, including non -federal CR and CC systems .  

### Explicitly allowing (and even encouraging) electronic instead of paper records. 

## 1.2.2. **Proposed Changes to the**  **Recordkeeping and Reporting Requirements** EPA is proposing to change the recordkeeping and reportin g requirements for technicians, technician certification programs, refrigerant recovery/recycling equipment testing organizations, refrigerant wholesalers and purchasers, refrigerant reclaimers, refrigeration and air
- conditioning equipment owners, and othe r establishments that perform refrigerant removal, service, or disposal. Specifically, EPA is proposing to:
 

### E xtend the current recordkeeping and reporting requirements to appliances containing HFCs and other non
- exempt substitutes.  

### Allow owners/operators of all CC and CR appliances containing 50 or more pounds of ODS refrigerant to prepare and submit requests for extensions to the leak repair and retrofit/retire timeli ne (currently limited to IPR and federally
-owned CC and CR appliances) .  

### Allow owners/operators of all CC, CR, and IPR appliances containing 50 or more pounds of HFC or other substitute equipment to prepare and submit requests for extensions to the leak repair and retrofit/retire timeline
.  

### Require persons servicing ODS, HFC, an d other non -exempt substitute refrigerant
- containing appliances with charge sizes of 50 or more pounds to provide records of the following for each refrigerant addition: the identity and location of the appliance, the date and type of service performed, the quantity and type of refrigerant added, the full charge of the system, and the leak rate .  

### Require owners/operators of ODS, HFC, and other non - exempt substitute refrigerant
- containing appliances with charge sizes of 50 or more pounds to maintain record s of the following for each refrigerant addition: the identity and location of the appliance, the date and type of service performed, the quantity and type of refrigerant added, the full charge of the system, and the leak rate .8 October 15, 2015

 

### Require owners/operators of ODS, HFC, and other non - exempt substitute refrigerant
- containing appliances with charge sizes of 50 or more pounds to maintain reports on the results of verification tests and leak inspections any time the leak rate threshold is exceeded .  

### Require owners/op erators of ODS, HFC, and other non - exempt substitute refrigerant
- containing appliances with charge sizes of 50 or more pounds to maintain records of quarterly and annual inspections .  

### Require technicians disposing of field
- installed appliances with charge s izes between 5 and 50 pounds of ODS, HFC, and other non
- exempt substitute refrigerant to maintain records on the quantity and type of refrigerant recovered at disposal and the quantity and type of refrigerant transferred for reclamation or destruction , as well as the company name and date .  

### Require approved technician certifying programs to publish online lists or databases documenting who they have certified and what type of certification each individual has received. The regulation would only require prosp ective lists of who is certified, not a compilation of everyone who was certified previously.  

### Require manufacturers of small cans of automotive refrigerant to keep records of test data and log forms that demonstrate compliance with the allowable leakage ra te. EPA is also proposing to remove the requirement for persons who maintain, service, repair, or dispose of appliances containing ODS refrigerants to submit a signed statement that they own certified recovery and recycling equipment. 

## 1.2.3. **Other Proposed Regula tory Revisions**  EPA is also proposing to change other regulatory requirements. Specifically, EPA is proposing to:
 

### E xtend the sales restriction to HFCs and other non
- exempt substitutes to ensure proper handling of ODS substitutes.  

### Exempt small cans of HFC refrigerant that are typically used for DIY aftermarket servicing of MVACs from the sales restriction.  

### Require self
-sealing valves on small cans of substitute (currently HFC
- 134a) refrigerant to minimize emissions from DIY servicing .  

### Extend all other the re gulatory requirements found at 40 CFR part 82, subpart F, including technician certification, appliance disposal, refrigerant reclamation, service practices, and the requirement to recover refrigerant to HFCs and other non
- exempt substitutes.  

### Require subst itute - containing recycling/recovery equipment to be certified. 

# 1.3. **Organization of This Report** The remainder of this report is organized as follows:9 October 15, 2015

 

### Section **2** characterizes the equipment regulated under Section 608 and identifies affected businesses within each sector .  

### Section **3** presents the general approach and assumpt ions used to estimate aggregate annual costs to the U.S. economy, economic impacts on small entities, and benefits associated with the proposed changes .  

### Section **4** s ummarizes the results of the aggregate economic impact analysis .  

### Section **5** summarizes the economic impact on small entities, including the SISNOSE determination .  

### Se **ction 6**  discusses the relevant statutes and EOs that EPA must satisfy .  

### Section **7** summarizes the results of the analysis.10 October 15, 2015



# 2. **Industry Characterization** The Agency’s proposed changes to the Section 608 regulations — including requirements for leak inspection and repair, recordkeeping and reporting, and self
- sealing valves for small cans — will affect a range of businesses and industries. This section identifies the industries that may be affected using North American Industry Classification System ( NAICS) codes. NAICS codes are industry classifications that the U.S. Census Bureau uses to track the number of businesses and relevant information about those businesses, including their distribution by employment size and sales receipts. 

# 2.1. **Affected Indust ry for Leak Inspection and Repair Requirements**  **2.1.1. Equipment Characterization**  The proposed changes to the requirements for leak inspection and repair will generally affect owners and operators of CR, IPR, and CC appliances with a full charge size of 50 pounds or more of ODS or HFC refrigerant. 3 

### These equipment types include:
 

### Commercial refrigeration systems are the refrigeration appliances used in the retail food and cold storage warehouse secto rs. Retail food includes the refrigeration equipment found in super markets, convenience stores, restaurants, and other food service establishments. All c old storage systems generally have charge sizes over 50 pounds and include the equipment used to store meat, produce, dairy products, and other perishable goods.  

### Indust **rial Process Refrigeration** systems are complex, customized systems used in the chemical, pharmaceutical, petrochemical , and manufacturing industries. These systems are directly li nked to the industrial process. This sector also includes industrial ice mach ines, appliances used directly in the generation of electricity, and ice rinks.  

### Comfort Cooling includes stationary refrigeration equipment that provides cooling in order to control heat and/or humidity in facilities, such as office buildings and light com mercial buildings. Comfort cooling appliances include building chillers and roof
-top self
- contained units. They may be used for the comfort of occupants or for climate control to protect equipment within a facility, such as in computer rooms. Table 4 presents the characterization of equipment by sector, type, size , and refrigerant used (ODS or HFC) . Assumptions are derived from d ata and analysis based on EPA’s Vintaging Model (see Box 1 ; EPA 2014 ) and on facility
- level reporting from California’s High
- Global Warming Potential Stationary Source Refrigerant Management Program (RMP) (see Box 2 ) , as described below .

3 Full c harge size is defined as the quantity of refrigerant needed for normal equipment operation.11 October 15, 2015 **Box 2**  **: California’s Refrigerant Management Program (RMP)** CARB adopted the RMP in 2009 as a part of the state’s Global Warming Solutions Act of 2006 (AB 32). The purpose of the RMP is to reduce emissions of high
- GWP refrigerants from stationary, non
- residential refrigeration equipment and from the installation and servicing of stationary refrigeration and air
- conditioning applianc es using high
GWP refrigerants. Effective January 1, 2011, facilities with refrigeration systems containing more than 50 pounds of refrigerant must conduct periodic leak inspections, promptly repair leaks, and keep onsite records. Beginning January 1, 201 2, facilities with systems containing more than or equal to 200 pounds must report annually through CARB’s online reporting tool on leak inspections, repairs, and purchases of high
- GWP refrigerants (CARB 2010a). This analysis uses data reported to CARB un der the RMP for the 2013 calendar year. The data include annual reports for facilities with refrigeration systems containing a full charge greater than or equal to 200 pounds. Although reporting is not required for refrigeration systems containing a full c harge between 50 and 200 pounds, some facilities have chosen to track leak inspections and maintenance records for these systems through CARB’s online reporting tool as well. For the 2013 calendar year, approximately 600, 42,000, and 4,600 leak event records were reported for small, medium, and large refrigeration systems, respectively (CARB 2014). While this analysis largely relies on 2013 RMP data, these data have been reviewed against other sources, including information from California’s South Coast A ir Quality Management District (SCAQMD) Rule 1415 and EPA’s Vintaging Model, to ensure that assumptions made are representative of the United States as a whole.

**Box 1**  **: EPA’s Vintaging Model** EPA’s Vintaging Model estimates the annual chemical emissions from industry sectors that have histor ically used ODS, including AC, refrigeration, foams, solvents, aerosols, and fire protection. Within these industry sectors, there are over 60 independently modeled end
uses. The model uses information on the market size and growth for each end
- use, as wel l as a history and projections of the market transition from ODS to alternatives. As ODS are phased out, a percentage of the market share originally filled by the ODS is allocated to each of its substitutes, including HFCs. The model tracks emissions of an nual “vintages” of new equipment that enter into operation by incorpo rating information on estimates of the quantity of equipm ent or products sold, serviced, and retired or retrofitted each yea r, and t he quantity of the compound required to manufacture, charge, and/or maintain the equipment. EPA’s Vintaging Model uses this market information to build an annual inventory of in
- use stocks of equipment and the ODS and non
- ODS substitutes in each end
- use. T he model is updated on a regular basis to reflect changes in the market and new industry information. 

### Equipment type and size. This analysis classifies e quipment into four size categories based on refrigerant charge s : small (containing between 50 and 199 pounds of refrigerant), medium <500 pounds (containing between 200 and 499 pounds of refrigerant), medium ≥ 500 pounds (containing between 500 and 2,000 pounds of refrigerant), and large (containing greater than 2,000 pounds of refrigerant ). These size categories are similar to those used by the California Air Resources Board ( CARB ) in their 2009 analysis of the RMP ( CARB 2009 a; see also Box 2 ) but adjusted to correspond with distinctions in the Agency’s proposed regulatory changes. For example, quarterly reporting is proposed for CR and IPR equipment with refrigerant charges of ≥500 pounds, thus, a distinction i s made between medium
-sized equipment with charge sizes above and below the 500 pounds threshold. Assumptions about the average charge size by equipment sector and type and the percentage of systems by type and se ctor were developed based on analysis of fa cility
- level reporting under California’s RMP . 4 

### Equipment type is not a reporting requirement of California’s RMP. Therefore, although this analysis relies on facility
- level data reported under the California RMP, additional analysis and assumptions were applied to these data regarding refrigerant use, size, and industry characterizations (outlined in Section 2.1.2 ). The additional analysis was

4 EPA’s Vintaging Model does not disaggregate all equipment types by size. Thus, facility
- level reporting under California’s RMP informed assumptions about charge sizes and equipment distributions by size and type.12 October 15, 2015



### used to group reported equipment into the equipment sectors, types, and industries affected by the proposed regulatory changes and to det ermine the universe of affected equipment by the proposed regulatory changes. Box 3 in Section 2.1.2 farther below illustrates this approach. **Refrigerant distribution.** EPA’s Vintaging Model is the basis for assumptions on t h e distribution of refrigerant (i.e., ODS and HFC) by equipment sector and type . 5



### Table **4 : Equipment Characterization by Sector, Type, Size, and Refrigerant Type**  **Equipment Sector**  **Equipment**

**Type Equipment** 

**Size Refrigerant** 

**Type Typical Charge** 

**Sizes (lbs) Percentage of** 

**Systems in Sector Distribution of** 

**Refrigerants by Type a**  CC Unitary AC Small ODS 114 28% 59% HFC 115 2% 41% Chiller Medium ODS 780 60% 62% HFC 651 8% 38% Chiller Large ODS 7,659 1% 62% HFC 5,118 2% 38% CR Condensing

Unit Small ODS 110 1% 41% HFC 97 9% 59% Rack Medium

< 500 lbs ODS 335 8% 51%

HFC 370 19% 49% Rack Medium

≥ 500 lbs ODS 961 20% 51%

HFC 930 33% 49% Rack Large ODS 2,501 1% 51% HFC 2,486 1% 49% Cold Storage Medium

< 500 lbs ODS 320 2% 57%

HFC 315 1% 43% Cold Storage Medium

≥ 500 lbs ODS 1,110 2% 57%

HFC 1,061 1% 43% Cold Storage Large ODS 7,368 2% 57% HFC 5,882 0% 43% IPR IPR Small ODS 70 5% 47% HFC 86 22% 53% Medium < 500 lbs ODS 322 16% 47%

HFC 306 8% 53%

5 To explore the sensitivity of the results to the ODS/HFC refrigerant distribution used, Appendix A.1 shows the results of this analysis using a distribution based on data reported under California’s RMP.13 October 15, 2015

**Equipment Sector**  **Equipment**

**Type Equipment** 

**Size Refrigerant** 

**Type Typical Charge** 

**Sizes (lbs) Percentage of** 

**Systems in Sector Distribution of** 

**Refrigerants by Type a**  Medium ≥ 500 lbs ODS 1,049 25% 47%

HFC 1,038 3% 53% Large ODS 5,592 13% 47%

HFC 5,062 8% 53% Totals may not sum due to independent rounding. Source: EPA 2014; CARB 2009 a a EPA’s Vintaging Model does not disaggregate all equipment types by size. Therefore, the same ODS/HFC distributions are applied across all size categories for some equipment types. 

### Table 5 and Table 6 below present the specific ODS and HFC refrigerants and charge size categorie s, respectively, that are most commonly used in the equipment types and sectors affected by this proposed rulemaking. Typical refrigerants used by each equipment type were identified using CARB (2009) and EPA’s Vintaging Model. 6 

### Table **5 : Typical**  **Refrigerant s Used**  **by Equipment Type Equipment**  **Sector Equipment**  **Type ODS**  **HFC** 123 22 402A 408A 134a 404A 407A 507 CC Centrifugal Chillers X X X Packaged Chillers X X X Unitary AC X CR Centralized Systems (DX, parallel rack) X X X X X X Condensing Units X X X Cold Storage X X X X X X IPR Process Cooling X X X Source: EPA 2014; CARB 2009 a 

### Table **6 : Typical**  **Charge Size Categories by Equipment Type**  **Sector CARB Equipment**  **Characterization Small**  **(50 -** **200 lbs) Medium** 

**(200 -** **2,000 lbs) Large** 

**(2,000 lbs and above)** CC Chillers X X Unitary AC X CR Condensing Units X

6 This analysis considers eight of the 32 refrigerants self
- reported under California’s RMP (i.e., ODS refrigerants and blends: R
123, R - 22, R -402A, and R
-408A and HFC refrigerants and blends: R
- 134a, R -404A, R -407A, and R
- 507). These eight refrigerants acc ount for 97% of the equipment reported under the RMP in 2013. Although Table 5 indicates the most commonly used refrigerants by equipment type, there are instances where systems reported using less common refrigerants.14 October 15, 2015 Rack X X Cold Storage X X IPR Process Cooling X X X Source: EPA 2014; CARB 2009 a 

### Only equipment that experience leaks that exceed the proposed leak threshold s will be subject to repair requirements ; however, all equipment containing 50 or more pounds of ODS or non - exempt substitute refrigerant will be subject to the leak inspection requirements and thus incur compliance costs. These assumptions are further elaborated in Section 3.1.1 . 

## 2.1.2. **Industry Characterization** The affected businesses (by NAICS code) were identifi ed from an analysis conducted by CARB (2009) on California’s RMP, a similar analysis of proposed leak repair requirements (Stratus 2009), an earlier RIA on this issue ( ICF 1997), an analysis of data reported under California’s RMP for 2013 (which includes self
- assigned NAICS codes from 3,565 facilities), the Program’s 201 5 supporting ICR ( EPA ICR Number: 1626. 1 3 , OMB Control Number: 2060
-0256) ( EPA 201 5b ) , and expert judgment. The affected businesses were grouped into 1 7 broader industry categori es based on industry similarities (e.g., different types of non
-food manufacturing, or different types of businesses that may have office buildings ) , as well as expert judgment on grouping the affected businesses by the types of equipment they are likely to use per facility. Table 7 below presents the list of affected industry sectors, NAICS codes, and NAICS code definitions. **Table 7**  **: Industry Sec** **tor, NAICS Code, and Definition Industry Sector Category**  **NAICS Codes a**  **, b**  **NAICS Code Definition** Agriculture and Crop Support Services 115 Support Activities for Agriculture and Forestry Arts, Entertainment, and Recreation 71 Arts, Entertainment, and Recreation Beverage and Ice Manufacturing 312 Beverage Manufacturing Durable Goods Wholesalers and Dealers 423 Merchant Wholesalers
- Durable Goods 441 Motor Vehicle and Parts Dealers Educational Services 611 Educational Services Food M anufacturing 311 Food M anufacturing General Merchandise Stores 452 General Merchandise Stores 453998 All Other Miscellaneous Store Retailers (except

Tobacco Stores) Grocery and Specialty Food Stores 4451 Grocery Stores15 October 15, 2015 **Industry Sector Category NAICS Codes**  **a ,**  **b NAICS Code Definition**  4452 Specialty Food Stores 72231 Food Service Contractors Hospitals 622 Hospitals Non - durable Goods Wholesalers and Dealers 424 Merchant Wholesalers – Non - d urable Goods Non -food Manufacturing 322 Paper Manufacturing 323 Printing and Related Support Activities 324 Petroleum Manufacturing 325 Chemical Manufacturing 3254 Pharmaceutical Manufacturing 326 Plastics and Rubber Manufacturing 332 Metals Manufacturing 333 Machinery Manufacturing 334 Computer and Electronic Product Manufacturing 336 Transportation Equipment Manufacturing 3391 Medical Equipment and Supplies Manufacturing 339999 Miscellaneous Manufacturing Office Buildings 511 Publishing Industries (except Internet) 512 Motion Picture and Video Industries 515 Broadcasting 517 Telecommunications 518 Data Processing, Hosting, and Related Services 519 Libraries and Archives 522 Credit Intermediation and Related Activities 524 Insurance Carriers 531 Real Estate 541 Professional, Scientific, and Technical Services 551 Management of Companies and Enterprises 561 Administrative and Support Services16 October 15, 2015 **Industry Sector Category NAICS Codes**  **a ,**  **b NAICS Code Definition**  712 Museums, Historical Sites, and Similar Institutions 721 Accommodation 813 Religious, Grantmaking, Civic, Professional, and Similar

Organizations Other Warehousing, Storage, and Transportation 48 Transportation and Warehousing 4931 Warehousing and Storage Refrigerated Warehousing and Storage 49312 Refrigerated Warehousing and Storage Research and Development 5417 Research and Development Utilities 2 1 1 Oil and G as E xtraction 2 2 1 Utilities Warehouse Clubs and Supercenters 452910 Warehouse Clubs and Supercenters Source: U.S. Census Bureau 2012 aThe NAICS codes range from the broadest classification, the two digit NAICS code, to the most narrow, six digit level NAICS c ode, with each progressive digit specifying a further level of detail. The first two digits distinguish the economic sector, the third digit distinguishe s the subsector, the fourth digit distinguishes the industry group, the fifth digit distinguishes the NAICS industry, and the sixth digit distinguishes the national industry (U.S. Census Bureau 2015). b In seve ral cases where a broader NAICS designation is listed (e.g., two digit code ), not all national industries (i.e., six digit code s ) were considered applicable to this analysis. A full list of NAICS codes, disaggregated to the degree of detail used in the ana lysis is available in Appendix E.1 . 

### Economic data for each affected industry — including number of firms and establishments 7 

### by employment or receipts size — was obtained from the U.S. Census Bureau’s Industry Statistics Portal (http://www.census.gov/econ/isp/) and includes the latest employment and receipt data from the U.S. Census Bureau 2012 County Business Patterns and the 2007 Economic Census, respectively ( U.S. Census Bureau 2012; U.S. Census Bureau 2007 ) . The economic census profiles U.S. national and local economies every five years, and the 2007 data is the latest available at the time of this writing. Table 8 below presents the total number of establishments (facilities) and firms (businesses), as well as small businesses and associated facilities, by industry category. Small businesses were ident ified using the U.S. Small Business Administration’s table of small business size standards matched to affected NAICS codes. The version employed for this analysis became effective July 14, 2014 (U.S. Small Business Administration 2014) .

7 The U.S. Census Bureau defines an establishment as a single physical location where business is conducted or where services or industrial operations are performed; a firm is a business organization consisting of one or more domestic establishments i n the same state and industry that were specified under common ownership or control. The firm and the establishment are the same for single
- establishment firms. For each multi
- establishment firm, establishments in the same industry within a state are counted as one firm , and the firm employment and annual payroll are summed from the associated establishments.17 October 15, 2015 

### Table **8 : Total Businesses**  **and Facilities by Industry Category Industry Category**  **All Businesses Small Businesses**  **Facilities Businesses**  **Facilities Businesses**  Agriculture & Crop Support Services 3,588 3,296 3,189 3,151 Arts, Entertainment, and Recreation 32,288 27,322 28,897 26,891 Beverage & Ice Manufacturing 4,712 4,135 4,134 4,052 Durable Goods 128,858 92,362 99,926 90,802 Educational Services 26,641 21,691 21,315 19,888 Food M anufacturing 25,798 22,293 22,533 21,319 General Merchandise Stores 55,428 20,412 24,839 20,044 Grocery & Specialty Food Stores 105,342 56,740 60,013 55,807 Hospitals 5,281 2,904 1,533 1,363 Non - durable Goods 52,363 40,256 39,061 37,576 Non -food Manufacturing 58,313 51,923 54,713 50,815 Office Buildings 2,258,830 1,910,880 1,998,350 1,874,025 Other Warehousing, Storage, and Transportation 67,627 53,145 53,582 50,312 Refrigerated Warehousing & Storage 1,158 628 638 503 Research and Development 15,501 12,359 12,426 11,660 Utilities 25,553 12,781 21,036 12,433 Warehouse Clubs & Supercenters 5,164 32 84 26 **Total 2,872,445**  **2,333,159 2,446,270**  **2,280,667** Source s : U.S. Small Business Administration 2014; U.S. Census Bureau 2012; U.S. Census Bureau 2007 

### CR and IPR appliances in facilities located in California are already subject to similar leak inspection and repair requirements under the California RMP . Thus, Ca lifornia facilities using those equipment types were removed from the total facilities and businesses considered when model facility assumptions were scaled up to determine total affected equipment for this analysis. California facilities using CC applianc es with refrigerant charges of 50 or more pounds were still included, as those systems are not already subject to similar requirements. To estimate aggregate costs and benefits across the entire U.S. economy, as well as costs per small business for the RFA/SBREFA screening analysis, assumptions were needed about the percentage of each industry category affected by the proposed regulatory changes (i.e., the proportion of facilities that would have appliances with refrigerant charges 50 or more pounds ) and t he type and number of equipment per affected facility and business.18 October 15, 2015



### Table 9 summarizes the assumptions made regarding the average number of systems in each sector per facility, for each industry category. These assumptions were based on analysis of 2013 data reported under California’s RMP, cross
-walked with assumptions made by si milar analyses (CARB 2009 a ; Stratus 2009) about equipment use by industry, and reconciled with expert judgment. Table 9 also presents assumptions about the percentage of each industry that is assumed to use equipment containing 50 or more pounds of ODS or HFC refrigerant, and thus be affected by leak inspection and repair provisions of the proposed rulemaking .  

### C**omfort C ooling**  — approximately 6% of commercial buildings (i ncluding offices, hospitals, and schools) are estimated to contain AC systems with a charge size of 50 or more pounds, based on data reported under the Commercial Building Energy Consumption Survey ( as reviewed in Stratus 2009 ) .  

### Commercial Refrigeration — al l industries assumed to use commercial refrigeration equipment use equipment that contains 50 or more pounds of refrigerant. Industries that only use smaller commercial refrigeration equipment (e.g., stand
- alone systems, beverage coolers, vending machines) are not considered in the commercial refrigeration equipment categorization.  

### Industrial Process Refrigeration — IPR are very large systems that contain 50 or more pounds of refrigerant. **Table 9**  **: Percentage of Industry**  **Containing Appliances with 50 or More Pounds of ODS or HFC**

**Refrigerant, and Average**  **Number of Systems per Facility**  **Industry Category Percentage of**  **Industry Affected Average Systems per**  **Facility CC**  **CR IPR**  Agriculture and Crop Support Services 100% 1 2 - Arts, Entertainment, and Recreation 1 - - Non - i ce Rinks 6% 1 - - Ice Rinks 2% 1 - 2 Beverage and Ice Manufacturing 100% 1 - 1 Durable Goods Wholesalers and Dealers 100% 2 - - Educational Services 6% 4 1 - Food Manufacturing 100% 1 2 - General Merchandise Stores Department Stores, Etc. 6% 1 - - Stores with Grocery Departments 10% 1 2 - Grocery and Specialty Food Stores 100% 1 2 - Hospitals 6% 2 - - Non - durable Goods Wholesalers and Dealers 100% 1 2 -19 October 15, 2015 **Box 3**  **: Industry and Equipment Characterization**  **Approach for the Agri cultural and Crop**  **Support Services Industry**  Information regarding refrigerant use (Table 5 ), typical sizes per equipment type ( Table 6 ), and equipment sectors used per industry ( Table 9 ) were triangulated to define model equipment and facilities for the purposes of this analysis. For example, t he Agriculture and Crop Support Services industry is assumed to use both CC and CR appliances. Facility reports under the RMP show e quipment in this industry contain ing R - 123, R - 22, R - 134a, R -404A, R -407A, and R
- 507. It can be reasonably assumed that all systems using R
- 404A, R -407A, and R
- 507 are commercial refrigeration systems, as these refrigerants are typically used only in the commercial refrigeration sector, regardless of equipment size. The Agriculture and Crop industry i s also assumed to use cold storage equipment in the commercial refrigeration sector, which falls in the medium and large size categ ories and typically uses R
- 22, but not R
- 123 or R - 134a. Therefore the reported medium and large R
- 22 systems are assumed to be commercial refrigeration systems, and the remaining R
- 123, R - 134a, and small R
- 22 systems are assumed to be for comfort cooling, with small systems likely being unitary AC and medium and large systems likely being chillers. This type of reasoning process was applied for each of the broad industry categories to define the distribution of equipment types per industry, as shown in the table below.
**Industry Average Systems and Equipment Types per Facility** 

**CC Unitary**  **AC Chiller**  **(M) Chiller** 

**(L) CR**  **Cond.**

**Unit Rack**  **(M) Rack**  **(L) Cold**  **Storage (M)**  **Cold Storage**  **(M) IPR**  Ag. and Crop Support Services **1** 74% 22% 4% **2** 5% 0% 0% 78% 17% **-**

**Industry Category Percentage of**  **Industry Affected Average Systems per**  **Facility** Non -food Manufacturing 100% 2 - 3 Office Buildings 6% 3 - - Other Warehousing, Storage, and Transportation 6% 4 - - Refrigerated Warehousing and Storage 100% 1 2 - Research and Development 6% 2 - - Utilities 6% 2 - - Warehouse Clubs and Supercenters 100% 1 3 - 

### In Box 3 below, the Agricultural and Crop Support Services industry is used to illustrate how the assumptions described in Sections 2.1.1 and 2.1.2 were applied to characterize the industries and equipment affected by the proposed leak inspection and repair regulatory changes.

To estimate the universe of potentially affected equipment by sector, the number of facilities per industry in the United States (shown in Table 8 ) was multiplied by the percentage of affected industries and the assumed pieces of equipment per facilities (as shown in Table 9 ). Total equipment per sector was then disaggregated by equipment type, size, and refrigerant based on the assumptions shown in Table 4 (Section 2.1.1 ). As shown in Table 10, there are approximately 1.5 million CC, CR, and IPR systems potentially affected by the proposed regulatory changes . 53% of these appliances contain ODS refrigerants, and 47% contain20 Oct ober 15, 2015



### HFCs. These systems contain over 900 million pounds of refrigerant, with a GWP
-weighted value of over 850 MMTCO 2 

### eq. **Table 10**  **: Universe of Affected Equipment** 

**Refrigerant Type Affected Equipment**  **CC CR**  **IPR Total**  ODS 578,181 156,981 79,961 815,123 HFC 440,511 211,584 75,276 727,371 Total 1,018,692 368,565 155,237 1,542,494 

# 2.2. **Affected Industry for R ecordke**  **eping and Reporting Requirements**  In addition to owners and operators of CC, CR, and IPR equipment (described in the previous section), t here are six main industries expected to be affected by the changes to the recordkeeping and reporting requirements: (1) refrigerant reclaim ers; ( 2 ) refrigerant wholesalers; ( 3 ) service technicians ; (4) small can manufacturers; ( 5 ) disposal establishments; and ( 6 ) service establishments . 8 

### The NAICS codes for these industry categories were identified using the Program’s 201 5 supporting ICR (EPA ICR Number: 1626. 1 3 , OMB Control Number: 2060
-0256) , as well as company research and expert judgment . Sales and employment data for all affected industries was collected from U.S. Census Bureau’s Economic Census and ReferenceUSA Online Database (U.S. Cen sus Bureau 2007 ; U.S. Census Bureau 2012 ; Infogroup Inc n.d. ) . The small business thresholds for the NAICS codes were used in determining the number of small businesses affected by the proposed recordkeeping and reporting requirements. The number of affect ed businesses in the following industry categories was assumed to be equivalent to those in the Program’s 2015 ICR Supporting Statement : reclaimers, refrigerant wholesalers, service technicians, disposal establishments, and service establishments (EPA 2015 b). The total number of affected businesses in each of these industr ies was proportioned across: 1) the affected NAICS codes within that industry and 2) business size category (based on either enterprise receipt or employment size, depending on the specifi c SBA threshold for each NAICS code). This proportioning yielded the estimated number of affected small businesses, by NAICS code and business size. 9, 10

8 Disposal and service establishments are expected to experience compliance cost relief due to EPA’s proposal to remove the requirement for persons who maintain, service, repair, or dispose of appliances c ontaining ODS refrigerants to submit a signed statement that they own certified recovery and recycling equipment . 9 This approach was modified for EPA certified reclaimers since four reclaimer entities are known to be in the Industrial Gas Manufacturing (N AICS code 325120) industry category, including Arkema, Dow Chemical Company, Honeywell, and National Refrigerants. Instead of proportioning these four entities across business size category, data from ReferenceUSA Online Database on number of employees and annual sales was used to determine economic impacts to small businesses. The proportioning method described above was applied to the remaining 57 certified reclaimer entities .21 October 15, 2015



### Table 11 below shows the total number of entities and small entities affected by industry category and NAICS code.

**Table 11**  **. Total Number of Small Entities Affected by Industry Category and NAICS Code Industry Category**  **NAICS**

**Code NAICS**  **Code Definition Total**  **Entities (Affected)**  **a Small** 

**Entities (Affected)**  **Industries Experiencing Annual**  **Compliance Cost** **s** Reclaimers 325120 Industrial Gas Manufacturing 4 1

423930 Recyclable Material Merchant Wholesalers 27 26 562920 Materials Recovery Facilities 4 3 562212 Solid Waste Landfill 3 2 424690 Other Chemical and Allied Products Merchant Wholesalers 23 22 Refrigerant Wholesalers 325120 Industrial Gas Manufacturing 52 52

424690 Other Chemical and Allied Products Merchant Wholesalers 3,930 3,700 42 Wholesale Trade 196,018 189,364 Service Technicians 238220 Plumbing, Heating, and Air
- conditioning C ontractors 300,000 295,592 Small Can Manufacturers 441310 Automotive Parts and Accessories Stores 5 2

325120 Industrial Gas Manufacturing 5 3 Sub
- Total 500, 0 71 488, 76 7 **Industries Experiencing Avoided**  **Compliance Cost** **s** Disposal Establishments 562920 Materials Recovery Facilities 35 32

562212 Solid Waste Landfill 25 24 423990 Other Miscellaneous Durable Goods Merchant Wholesalers 315 289 Service Establishments 811310 Commercial Industrial Machinery and Equipment (not Automotive and Electronic) Repair and Maintenance 1,872 1,800 811412 Appliance Repair and Maintenance 378 376 Sub
- Total 2,625 2,521 **Total 502,**  **6 9**  **6 491,**  **28 8** 

10 This approach was similarly modified for small can manufacturers. Instead of proportioning these five entities across business size category, data from ReferenceUSA Online Database on number of employees and annual sales was used to determine economic impacts to small businesses.22 October 15, 2015 a T he estimated number of firms in each industry category (i.e., reclaimers, refrigerant wholesalers, and service technicians) were distributed on a weighted basis across the affected NAICS codes, where the weighting was based on the n umber of firms in each NAICS code . This approach was slightly modified for EPA certified reclaimers and small can manufacturers, since the NAICs codes of some specific entities were known. 

# 2.3. **Affected Industry for Self -** **s ealing Valves on DIY Small Cans**  To identify small can manufacturers potentially affected by the DIY self
- sealing valve requirements, an internet search was combined with industry input from the Auto C are Association and the Automotive Refrigerant Products Institute ( ARPI ). Ten manufacturers were identified. This analysis assumes that all small can manufacturers can be categorized into the following NAICS codes: 441310 Automotive Parts and Accessories Stores and 325120 Industrial Gas Manufacturing . Information on number of employees and annu al sales volume was collected for each of the affected entities from ReferenceUSA Online Database (Infogroup Inc n.d.). Then, based on company research and expert judgement, each entity was assigned a NAICS code (i.e., either 441310 or 325120). Small busin es s standards established by the SBA were then used to assess whether an entity is considered small . For NAICS code 441310, small entities are determined based on annual sales volume, where entities with an annual sales volume of less than $15 million are categorized as small (SBA 2014) . For NAICS code 325120, small entities are determined based on total number of employees, where entities with less than 1,000 employees are categorized as small (SBA 2014) . Using the SBA size standards, it was estimated that five of the affected entities are small businesses. Table 12 below outlines the number of entities and small businesses by industry category. **Table 12**  **: Industry Characterization**  **for Small Can Manufacturers Affected by Proposed Rule**  **Industry Category NAICS**  **Code NAICS Code Definition**  **Total Entities Affected**  **Total Small**

**Entities** Small Can Manufacturers 441310 Automotive Parts and Accessories Stores 5 2 325120 Industrial Gas Manufacturing 5 323 October 15, 2015



# 3. **Methodology** This section presents the methodology used to estimate the incremental impact of the proposed regulatory changes on the U.S. economy as a whole and on small businesses individually (for the RFA/SBREFA screening analysis). The impact of EPA’s proposed changes includes **compliance costs** (including avoide d compliance costs because of the proposed removal of regulatory requirements and provision of additional flexibility measures) , **refrigerant savings**  (associated with reduced refrigerant use), and **emission reduction benefits** . The analysis uses a model entity approach to estimate these impacts. The model entity approach is built up from a model facility analysis, which was developed based on assumptions about model equipment.
 

### Model equipment . First, the compliance costs, avoided compliance costs (i.e., compli ance costs no longer incurred), refrigerant savings, and benefits associated with the proposed regulatory requirements (i.e., leak inspection and repair, and recordkeeping and reporting) were estimated for each type of affected equipment .  

### Model facility . Next, based on the compliance costs and benefits per affected equipment, costs and benefits were estimated for a model facility in each of the industry categories described in Section 2 . Assumptions about the number and type of equipment used per model facility varied based on the industry category. Assumptions about the proportion of equipment affected per industry were incorporated, b ased on equipment type and size, refrigerant type, and leak rate distributions. For the analysis of the aggregate impact on the U.S. economy, the model entity step was bypassed by multiplying the costs and benefits per model facility by the number of affected facilities. These scaling assumptions varied based on the industry category. Because CR and IPR equipment in facilities located in California are already subject to requirements that are generally more stringent than those in the proposed rule, costs a nd benefits were not included for these equipment/facilities.  

### Model entity . For the RFA/SBREFA screening analysis, costs per model facility were scaled to a model entity on both an industry
- specific and size
- specific basis. Therefore, each model entity reflected information about the average number of facilities an entity has in a given industry category and size (i.e., smaller entities typically have fewer facilities per entity than larger businesses). All costs and benefits were estimated on an annual ba sis, based on assumptions about the current distribution of affected ODS
- and substitute
- containing equipment. An analysis of future benefits in 2020 and 2025 was also conducted, as described in 3.3.1.2 . All costs are shown in 2014 dollars. As noted previously, the proposed rule update s and extend s the existing requirements to non
-ozone de pleting substitute refrigerants . The main class of refrigerant affected by thi s proposed extension is HFCs since many other refrigerants currently in use are exempted from the venting prohibition. As such, this analysis estimates the incremental costs and benefits associated with the application of the proposed regulatory changes to ODS and HFC equipment.24 October 15, 2015



### The remainder of this chapter is organized as follows:
 

### Section 3.1 describes the approach for estimating the aggregate cost to the U.S. economy.  

### Section 3.2 presents the methodology for estimating the impact on small businesses.  

### S ection 3.3 provides the benefits estimation approach. 

# 3.1. **Approach fo r Estimating Aggregate Annual**  **Costs to the U.S. Economy**  The sections below describe the method and assumptions used to estimate aggregate incremental costs associated with the Agency’s proposed regulatory changes related to: leak inspection and repair, reporting and recordkeeping, and self
- sealing valves on DIY small cans. The final section provides rationale for assuming no incremental compliance costs associated with other proposed regulatory changes. 

## 3.1.1. **Leak Inspection and Repair** Proposed regulatory changes associated with leak inspection and repair are expected to result in:
 

### C**ompliance costs** associated with conducting leak inspections and repairs.  

### Avoided compliance costs associated with changes in the leak repair requirements that relieve regulatory burden. Specifically, EPA proposes to grant the same flexibili ty to owners or operators of ODS CC and CR appliances as is currently offered to owners or operators of ODS IPR appliances to request additional time to make repairs due to the unavailability of components. This additional flexibility is expected to result in fewer ODS appliances being retired prematurely.  

### Refrigerant savings associated with repairing leaks earlier. As noted above, costs and savings were estimated us ing a model equipment, facility, and entity approach. Costs were then scaled up industry
-wi de based on the proportion of businesses that could be affected by the regulation in order to determine the full impact of each of the proposed changes. 

### 3.1.1.1. **Leak Inspection** The proposed regulatory changes result in compliance costs to equipment owners and operators in order to meet new requirements to conduct annual leak inspections for CC, CR, and IPR systems with charge sizes between 50 and 500 pounds and quarterly leak inspections for CR and IPR systems with charge sizes of 500 or more pounds . As a baseline, the analysis conservatively assumes that neither annual nor quarterly leak inspections are currently performed. 11 

### This assumption may overestimate compliance costs since, in practice, some owners and operators have indicated they conduct reg ular

11 Similarly, no appliances were assumed to have regu larly
- certified automatic leak detection equipment.25 October 15, 2015



### leak inspections to ensure that systems continue to function properly and to avoid recurring refrigerant top - off costs. Automatic leak monitoring equipment is also becoming more common, which would further reduce actual compliance costs. 

### 3.1.1.2. **Leak Repair** T he proposed regulatory changes result in compliance costs to owners and operators when leaks are identified in equipment containing 50 or more pounds of ODS or HFC refrigerant that exceeds the leak rate of 10% for CC or 20% for CR and IPR equipment. Equipm ent owners and operators must repair all identified leaks within 30 days, or, under certain circumstances, request an extension to conduct the repair; if leaks cannot be repaired, the appliance must be retrofitted or retired. 12 

### These proposed requirements a re incremental for owners and operators of equipment containing 50 or more pounds of:
 

### HFC refrigerant that exceeds the leak rate of 10% for CC or 20% for CR and IPR; and  

### ODS refrigerant that exceeds the leak rate of 10% for CC or 20% for CR and IPR . 13 

### When leaks are repaired, a ll appliances must also conduct initial and follow
- up verification tests ; this requirement currently only applies to federally
-owned and IPR appliances. **Leak r** **epair o**  **utcomes.** Lower applicable leak rates, in combination with the propose d regulatory requirement for leak inspections for all eligible equipment, should lead to leaks being identified and repaired sooner than under the current approach . As such, this analysis assumes that leaks will be detected and repaired earlier across all CC, CR, and IPR equipment containing 50 pounds or more of ODS or HFC refrigerant. Specifically, the analysis assumed that ODS and HFC equipment that experiences a leak event requiring repair realizes one of three outcomes:
 

### The **standard repair** outcome cons ervatively assumes that repairs are conducted three weeks earlier as a result of the proposed leak repair and leak inspection requirements (see Box 4 ) .

12 The proposed regulatory changes also prohibit an appliance from leaking more than 75% of its full charge in two consecutive years. Because the economic analysis presented in this document assumes full compliance with the regulatory changes, it is assumed that qualifying leak events are identified and repaired within a one
-year period, such that equipment would not be able to leak more than 75% of its total charge within a two year period. 13 Although u nder the current Section 608 requirements, owners and operators of equipment containing more than 50 lbs. of ODS refrigerant are already required to repair leaks if the leak rate is above 15% CC and 35% for CR and IPR, it was assumed that the proposed leak inspection requirements would still accelerate the detection and repair of leaks of ODS equipment leaking above the previous threshold leak rates of 15% for CC and 35% for CR and IPR in addition to CC equipment with a leak rate between 10 and 15% and CR a nd IPR equipment with a leak rate between 25 and 35%.26 October 15, 2015 **Box 4**  **: Assuming Three -** **week Earlier Repair** The assumption that repairs are conducted three weeks earlier as a result of the proposed rulemaking was based on analysis of facility
- level reporting on leak repair under California’s RMP. Individual system - level leak rates were estimated using the amount of refrigerant reported as added during each leak event and the number of days between the refrigerant addition and the previous record for each system. This data set (i.e., individual system leak rates) was then grouped into leak rate bins (e.g., 0
- 10%, 10 - 20%, 20 - 30%, and so on). The average leak rate for each bin was used to calculate the number of weeks before the system would lose 40% of its charge. It was assumed that systems below 60% of their full charge would require servicing — regardless of the proposed requirements for mandatory inspection and repair (Kim and Braun 2010). Leak events were assumed to be spread evenly over a 13 week period to simulate the time between proposed quarterly inspections. The average number of weeks early that a leak would be detected for each bin was calculated based on this spread. For example, if a system is leaking at a rate that would cause it to lose 40% of its charge in eight weeks, and the leak inspection occ urs in week four, the leak is assumed to be caught four weeks early. The average number of weeks early for each bin was then weighted based on (a) the number of systems in each bin and (b) the emissions value of catching a leak early in each bin. The emi ssions weighting accoun ts for the fact that catastrophic leaks would likely be found very quickly due to performance degradation, regardless of mandatory leak inspections, whereas slower, smaller leaks would benefit proportionately more from early detectio n through leak inspection. This approach yielded a weighted average of approximately three weeks early that a leak would be detected. More and less conservative assumptions were also modeled, assuming repairs are conducted two weeks earlier and two months earlier as a result of the proposed leak repair and leak inspection requirements. These alternate results are shown in Appendices 0 and 0, respectively.  

### Under the **extension repair** outcome, owners/operators request an extension for conducting the repair. The analysis conservatively assumes that repairs are also conducted three weeks earlier as a result of the proposed leak repair and leak inspection requirements. As mentioned above, t he proposed extension would allow owners/operators of non
-federally
-owned C C and C R appliances additional time to repair an appliance if components cannot be delivered within the necessary time . As a result, some ODS CC and CR systems that would have been prematurely retired under the current approach are now expected to request extensions. 14  

### The **retrofit/ retirement**  outcome assumes that systems that require retrofitting/ retirement are retrofitted/ retired 5 years earlier than they would have been in the absence of the proposed regulatory changes (i.e., 5 years were assumed to be remaining before normal end
- of
- life). ODS systems were assumed to be retired as they are generally older systems, and HFC systems were assumed to be retrofitted. As previously not ed, some owners or operators would have prematurely retired their ODS CC and CR equipment if a component could not be delivered in time, but now would apply for an extension. These avoided system retirements will result in avoided compliance costs for thes e equipment owners. Table 13 below shows the proportion of affected equipment assumed to experience each outcome. The percentage of ODS systems reaching the retrofit/ retirement outcome is shown as zero because n o ODS

14 Specifically, the analysis assumes that 50% of the ODS CC and CR systems that would have been prematurely retired under the current requirements instead apply for an extension. The baseline number of ODS system retirements was taken from EPA (2015b).27 October 15, 2015



### systems are assumed to experience incremental incidence of retrofit or retirement. However, approximately 2,300 premature retirements of ODS CC and CR appliances are expected to be avoided as a result of the proposed consistent set of extensions for all appliance types. 15 

### These avoided retirements result in reduced regulatory burden and avoided compliance costs. **Table 13**  **: Leak Repair Outcomes and Proportions Outcome**  **HFC Systems**  **ODS Systems**  Standard Repair 

### 97% 98% Extension Repair 

### 2 % 2 %* Retrofit/Retire ment 

### 1 % 0% * Only includes CC and CR appliances . 

### Frequency of **r epair.**  D ata reported under California’s RMP was reviewed to determine an appropriate assumption for the annual frequency of repair for systems that use advanced leak detection monitoring systems or are inspected annually or quarterly and are leaking above the proposed leak rates. These data suggest that most systems are repaired once per year, with the exception of larger (>500 lb s. ) cold storage systems, which are repaired about twice per year on average. 16 

### T his analysis assumes that there would be a similar relationship between quarterly or annual leak inspections and leak detection and subsequent repair for equipment that is subject to Section 608 as there is for the equipment subject to California’ s RMP. **Repair e** **ffectiveness and**  **b aseline**  **l eak**  **r ates**  **.** For all equipment types and sizes, post
- repair leak rates reflect CARB (2009) estimates, which were based on EPA’s Vintaging Model and Intergovern mental Panel on Climate Change ( IPCC )/Technology and Econ omic Assessment Panel (TEAP ) (2005) recommendations . While EPA is requiring repair of all identified leaks if the applicable leak rate is exceeded, EPA recognizes that a post
- repair leak rate of zero is not always the case. Therefore, th e modeled post
- repa ir rates may be more conservative than what may be achieved if this rule is finalized as proposed. To explore the sensitivity of costs and benefits to h igher post
- repair leak rates, the analysis was also run using post
- repair rates set at 90% of the thresh old leak rate (i.e., if the threshold rate is 20%, it is assumed that the system is repaired and has a resulting leak rate of 18%). Appendix A.3 shows t he results of this sensitivity analysis. To develop assumptions for the baseline leak rates, multiple sources of leak rate information were reviewed and compared. First, average annual leak rates for equipment reported under California’s RMP

15 As noted previously, this is based on an assumption that 50% of the ODS CC and CR systems that would have been prematurely retired under the current requirements instead apply for an extension. The base line number of ODS system retirements was taken from EPA (2015b). 16 Cold storage systems that are repaired twice are assumed to follow a modified standard repair outcome. After the first leak i s repaired, the system is assumed to leak for one week at the p ost- repair leak rate. At that point, the system is assumed to experience a failure such that two weeks after the original repair the system has leaked a qualifying amount of refrigerant t o require a second repair.28 October 15, 2015



### were determined, 17 

### and leak rates and number of affected equipment within and outside of the leak rate thresholds were examined at different levels of aggregation (e.g., sector, type, size, and refrigerant). This examination suggested that the economic analysis should develop separate leak rates for different e quipment types and sizes. To ensure that this analysis used leak rates that were representative of equipment throughout the United States, average annual leak rates reported under the RMP that were above the leak rate thresholds for each sector were avera ged and compared with equipment leak rates modeled in EPA’s nationwide Vintaging Model . This comparison of leak rates suggested that the RMP data set is likely a strong indicator of average leak rates for equipment above the leak rate thresholds throughout the United States and is discussed further in Section 3.1.1.4 . Table 14 below presents the final leak rate assumptions by equipment sector, type, and size for equipment that is affected by the leak repair req uirements (i.e., is expected to leak above the leak rate thresholds ). 18 

### The percentage of each equipment type that is experiencing a qualifying leak is discussed in Table 17 . For example, although only 23 % of condensing unit systems have an annual average leak rate exceeding 20%, the average annual leak rate of those systems is 66% according to the RMP data.

**Table 14**  **: Leak Rate Assumptions by Equipment Sector, Type, and Size Leak**  **Rate Threshold**  **Equipment Sector Equipment Type**  **Equipment Size Baseline Annual**  **Leak Rate (for**  **Equipment Requiring Repair)**  **Annual Post******

**r epair Leak**  **Rate** 10% CC Unitary AC Small 60% 5% Chiller Medium 49% 2% Chiller Large 47% 2% 20% CR Condensing Unit Small 66% 5% Rack Medium ≥ 500 lbs . 49% 10% Rack Medium <500 lbs . 70% 10% Rack Large 47% 10% Cold Storage Medium ≥ 500 lbs . 55% 10% Cold Storage Medium <500 lbs . 79% 10% Cold Storage Large 62% 10%

17 Annual leak rates were calculated as the total amount of refrigerant added to a piece of equipment minus any refrigerant removed from the equipment ( e.g ., due to seasonal adjustment) throughout the year, divided by the charge size of the equipment. 18 The average baseline annual leak rate s shown in Table 14 are based on actual leak rate data reported to the CARB RMP. Although leak repair requirements are currently in place for ODS CC, CR, and IPR equipment when their average annual leak rate exceeds th e threshold leak rates of 15% and 35%, respectively, annual leak rates can still exceed these threshold leak rates prior to the repair .29 October 15, 2015

**Leak Rate**  **Threshold Equipment Sector**  **Equipment Type Equipment Size**  **Baseline Annual Leak Rate**  **(for Equipment**  **Requiring Repair) Annual Post** ****

**r epair Leak**  **Rate** IPR IPR Small 97% 7%

IPR Medium ≥ 500 lbs . 59% 7% IPR Medium <500 lbs 76% 7% IPR Large 58% 7% 

### Assumptions about equipment charge sizes were made by equipment type and size category, as well as by refrigerant type (HFC and ODS), based on data reported under the California RMP. These disaggregated assumptions are shown in Section 2.1.1 . 

### 3.1.1.3. **Unit Cost and Savings Assumptions Leak**  **i nspection.**  Leak inspections were assumed to require one hour per system per inspection for commercial refrigeration and IPR, and 30 minutes for comfort cooling systems. An hourly labor rate of $ 45.07 was assumed for leak inspection and repair, based on the median hourly earnings of $21. 46 for heating, air
- conditioning, and refrigeration mechanics and installers from the Bureau of Labor Statistics, plus 110% to account for overhead ( $23. 6 1). **Leak r** **epa ir**  . Repair costs are calculated as the base cost of making the repair or retrofit, including labor, parts, refrigerant recovery, and verification tests . 19 

### These costs are assumed to vary by system size, where leak repairs on a smaller system are assumed to be relatively simpler and less costly than repairs on medium and large systems. The base costs associated with each outcome were estimated as described below. All costs were adjusted to 2014 dollars.
 

### Standard repair. Leak repair costs for a “standard repai r” are based on assumptions in CARB (2009). CARB (2009) surveyed refrigeration and AC service contractors and technicians to validate these cost assumptions.  

### Extension repair. An “extension repair” is assumed to involve the repair of a major component suc h as a compressor, and is based on costs presented in Stratus (2009). 20  

### Retrofit. Retrofit costs were also based on Stratus (2009) ; this analysis assumed that the cost to retrofit an entire piece of equipment was between two to three times the cost of the compressor .

19 Industry input suggested that verification tests are already conducted as standard practice during servicing events. Moreover, because initial and follow
- up verification tests can both be conducted during the same service appointment, this requirement is not expected to result in a longer servicing event (and thus not expected to result in incremental labor costs). 20 Stratus (2009) obtained estimates of retail prices for typical replacement compressors from a supplier (ThermaCom Ltd.).30 October 15, 2015



### As noted above, HFC systems were assumed to be retrofitted, while ODS systems were assumed to be retired as they are generally older systems.  

### Retirement. The base cost of retirement is assumed to be the installed cost of new, replacement equipm ent. The installed cost of CC, CR, and IPR equipment varies significantly across and within equipment types and capacities. For the purposes of this analysis, a reasonable average cost by equipment size was estimated through review of available literature (Stanford University 2011; Tait Consulting Ltd 2012; ACEEE 2013), including economic analyses conducted for other federal agencies (DOE 2009; DOE 2013 ) , and industry calls. As noted above, lower leak rate thresholds, combined with new requirements for leak inspections, will result in leaks being repaired sooner than under the current approach. The analysis assumes that repairs are conducted three weeks earlier as a result of these proposed requirements. Thus, the repair costs attributable to the rule are based on the time cost of conducting those repairs three weeks earlier. The interest cost (at 7% per year) 21 

### of the base repair cost is attributed to the rule; this cost is referred to below as the “effective cost of repair.” CARB used a similar approach — i.e., estimati ng the effective cost of repair — in developing its economic impact estimates for its High
- Global Warming Potential Stationary Source Refrigerant Management Program (CARB 2009a). A sensitivity analysis exploring the impact of assuming repairs are conducted two months earlier — which results in higher effective costs of repair — is shown in Appendix A.4 . An “effective cost” approach was also taken for the cost of retrofitting and retirement. Systems that are retrofitted as a result of the proposed regulatory changes are assumed to be retrofitted five years earlier than they would have been under current practices. Thus, the effective cost of retrofi tting attributable to the rule is the cost of borrowing the funds for retrofitting for five years at 7% per year. Similarly, the avoided effective cost for premature retirement of ODS CC and CR appliances is the cost of borrowing the funds for purchasing a new system for five years at 7% per year. Table 15 below presents the base and effective cost assumptions by repair and system size. For retrofit and retirement outcomes, the costs presented do not include the additional cost of replacing the entire refrigerant charge with virgin refrigerant or charging a new system. With charge sizes exceeding 7,000 pounds in some very large systems, these costs can be sizeable. For the standard and extension repair outcomes, the cost of refrigerant recharge is not included, since it is assumed that the owner or operator would have topped off the system in the absence of the proposed requirements.

21 A sensitivity analysis using an interest cost of 3% per year of the base unit cost is shown in Appendix A.4 .31 October 15, 2015 

### Table **15 : Un**  **it Cost Assumptions System Size**  **Labor**

**Hours Parts**  **Refrigerant Recovery**  **Total Base Cost for**  **Labor,**

**Parts, and Recovery Effective Cost of**  **Early Repair /**  **Retrofit Standard Repair**  Small 8 $109 $218 $682 $3 Medium 12 $327 $382 $1,241 $5 Large 16 $655 $709 $2,073 $ 9 **Extension Repair** Small 20.25 $2,836 $218 $3,967 $1 7 Medium 20.25 $10,345 $382 $11,639 $ 51 Large 20.25 $10,345 $709 $11,966 $ 52 **Retrofit (HFC Equipment)** Small 20.25 $8,343 $218 $9,473 Varies based on charge size of equipment retrofitted Medium 20.25 $22,247 $382 $23,541 Large 20.25 $22,247 $709 $23,869 **Retirement (ODS Equipment)** Small $20,000 Varies based on charge size of equipment replaced Medium $100,000 Large $250,000 Source s: for Standard Repair Labor Hours, Parts, and Recovery Costs: CARB 2009 a ; for Extension Repair and Retrofit: Status 2009 ; for Retirement: Stanford University 2011; Tait Consulting Ltd 2012; ACEEE 2013; DOE 2009; DOE 2013. 

### Refrigerant **s avings**  . By causing leaks to be repaired earlier, the proposed regulatory changes would result in refrigerant cost savings for system operators. Refrigerant cost savings are calculated based on the difference between the baseline and post
- repair leak rates, multiplied by the charge size, over the three weeks earlier t hat each repair was conducted. An average price of $6 per pound was assumed for all refrigerants. On a per system basis, effective refrigerant savings range from $ 20 for small systems up to $ 1 , 3 00 for large cold storage and IPR systems. **Leak r epair**  **e xpect** **ed c**  **osts and**  **s avings**  . Expected costs and savings per model equipment were estimated on a weighted basis, taking into account the proportion of equipment assumed to reach each leak repair outcome and the unit costs and savings associated with each outcome. Expected costs and savings were estimated in the model in a disaggregated manner, distinguishing between equipment sectors, types, sizes, and refrigerant type.32 October 15, 2015



### 3.1.1.4. **Model Facility Assumptions** The following calculation steps yielded aggregate costs/savings for t he U.S. economy as a whole. 1. Leak repair expected costs/savings per model equipment type (as described above) were multiplied by the number of each type of equipment per facility (see below) and the percentage of each type of equipment assumed to experience leaks above the proposed rule’s threshold rate s (see below) . 2. Leak inspection costs per model equipment type were multiplied by the number of each type of equipment per facility (see below) , taking into account equipment size to determine require d frequency of inspection. 3. The sum of e xpected leak repair costs/savings and leak inspection costs per model facility was then multiplied by the total number of facilities in each industry category (see below) and the percentage of each industry assumed to be affected (see Section 2.1.2 ) . Because CR and IPR appliances in facilities located in California are already subject to similar leak inspection and repair requi rements under the California RMP, these appliances are removed from the analysis of costs and benefits. The assumptions made are summarized below. In the model developed for this analysis, calculations were performed in a disaggregated manner, distinguishi ng between industry sectors, equipment sectors, types, sizes, and refrigerant type. Many of these assumptions were based on confidential business information reported under California’s RMP. To preserve the confidentiality of those data, assumptions are su mmarized on an industry
- or equipment type - specific basis. Section 2.1 summarizes the assumptions made regarding the average number of systems in each sector per model facility, for each industry category and the assumptions about the percentage of each industry that is assumed to use equipment containing 50 or more pounds of ODS or HFC refrigerant, and thus be affected by the proposed rulemaking. Only equipment that experiences leaks that exceed the proposed leak threshold will be subject to repair requirements and thus incur compliance costs to repair those leaks . To determine this proportion of equipment, data submitted for CR and IPR under California’s RMP was reviewed . For CC, although facilities are not required to report data on CC systems under California’s RMP, some do, so while RMP data was reviewed to establish preliminary assumptions for CC systems, additional sources, such as data reported under California’s South Coast Air Quality Management District (as analyzed in Stratus 2009), EPA’s Vintaging Model , and expert judgement were also used to estimate the proportion of affected systems. Table 16 below presents a comparison of leak rate distributions by equipment sector and refrigerant type, based on analysis of California’s RMP and EPA’s Vintaging Model.33 Octob er 15, 2015 

### Table **16 . L** **eak Rate Comparison B** **ased on California’s RMP and EPA’s Vintaging Model**

**Equipment Sector**  **Ref. Type Leak Rate** 

**Distribution Percent of Equipment within** 

**Leak Rate Distribution CARB RMP**  **VM** CC ODS >1 0 % 23 % 4%

HFC >10% 20 % <1 % CR ODS > 20 % 19 % 100%

HFC >20% 17% 6 3 % IPR ODS > 20 % 1 5 % 0%

HFC >20% 14% 0% Note: The Vintaging Model assumes that 100% of ODS and HFC IPR systems have a leak rate below 20%. 

### Within each sector, the CARB RMP data suggest that the leak rate distributions for ODS and HFC systems are similar. Differences between the leak rate distributions from California’s RMP and those from the Vintaging Model can be attributed to how annual lea k rates are developed (i.e., reported leak rate data and average leak rates across equipment types, respectively). Section 2.1.1 discusses these differences further. B ased on the information above, ODS and HFC equipment were assum ed to have t he same leak rate distribution s, disaggregated by equipment type and size . Table 17 presents the assumptions made for this analysis regarding the proportio n of affected equipment experiencing leaks above the threshold. **Table 17**  **: Affected Equipment Assumptions by Equipment Sector, Type, Size, and Refrigerant Type Equipment Sector**  **Equipment Type Equipment Size**  **Percentage of Equipment Experiencing Leaks Above**  **the Proposed Threshold**

**Rate** CC Unitary AC Small 20% Chiller Medium 23% Large 16% CR Condensing Unit Small 23% Rack Medium <500 6%

Medium ≥500 13% Large 26% Cold Storage Medium <500 13%

Medium ≥500 17% Large 33% IPR IPR Small 6%34 October 15, 2015 **Equipment Sector Equipment Type**  **Equipment Size Percentage of Equipment**  **Experiencing Leaks Above the Proposed Threshold** 

**Rate** Medium <500 12% Medium ≥500 10% Large 10% 

## 3.1.2. **Recordkeeping and Reporting** Proposed regulatory changes associated with recordkeeping and reporting are expected to result in:
 

### C**ompliance costs** associated with incremental requirements for recordkeeping and reporting for ODS - containing appliances, extending the requirements for recordkeeping and reporting to appliances containing substitute refrigerants, and adding new recordkeeping and reporting requirements .  

### Avoided compliance costs associated with the removal of some recordkeeping and reporting requirements. The sections below describe the assumptions and methodology used to estimate recordkeeping and reporting costs and avoided costs associate d with the proposed regulatory changes. All recordkeeping and reporting costs are calculated by multiplying the estimated burden (hours) times the average annual respondent hourly cost (labor plus overhead) . For all recordkeeping and reporting requirements, except the new recordkeeping requirement for small can manufacturers, 22 

### t he analysis uses the median hourly earnings of $21. 46 for heating, air
- conditioning, and refrigeration mechanics and installers from the Bureau of Labor Statistics (BLS 2014a) . This number was multiplied by 110% for overhead ( i.e., $21. 46 x 1.10 = $23. 6 1 ) . The resulting cost of $ 4 5 . 07 ($21. 46 + $23. 6 1 ) is the average hourly administrative cost of labor plus overhead for a private firm. 

### 3.1.2.1. **Recordkeeping and R** **eporting A** **ssociated with L** **eak Inspection and R** **epair** The sections below describe how the incremental annual burden time was estimated for each recordkeeping and reporting requirement associate d with leak inspection and repair. To generate costs, the annual burden time was multiplied by the hourly wage rate. **Requests for extens ions to the leak repair and retrofit/retire timelines**  **.** Owners or operators of IPR appliances and fede rally
- owned CR and CC appliances normally containing 50 or more pounds of ODS refrigerant may apply to EPA for an extensio n to the leak repair and appliance retrofit/retire time frame.

22 The median hourly earnings of $ 13 . 74 for Weighers, Measurers, Checkers, and Samplers, Recordkeeping occupational workers from the Bureau of Labor Statistics was assumed for small can manufacturers (BLS 2014b) . This number was multiplied by 110% for overhea d (i.e., $13.74 x 1.10 = $15.11 ). The resulting cost of $ 28 . 85 ($ 13 . 74 + $ 15 . 1 1) is the average hourly administrative cost of labor plus overhead for a private firm .35 October 15, 2015



### EPA is proposing to extend this requirement to : 1) all equipment types, including CC and CR appliances that are not federally
- owned; and 2) appliances normally containing 50 or more poun ds of HFC refrigerant . First, the incremental burden associated with submitting extension requests for CC and CR equipment containing ODS refrigerants was estimated . T he total number of extension requests for IPR equipment under the current requirements w as identified using the Program’s supporting ICR (EPA ICR Number: 1626. 13 , OMB Control Number: 2060
-0256) , and this number was then scaled based on the expanded pool of affected equipment (i.e., CC and CR) using the model facility assumptions described in Section 3.1.1.4 above . In addition, some ODS
- containing CC and CR equipment that would have been prematurely retired under the current approach are now expected to request extensions, as described in Section 3.1.1.2 . 23 

### As a result, the number of extension requests for ODS
- containing CC and CR is expected to increase, while the number of plans developed to retire/replace or retrofit ODS
- containing CC and CR equipment is expected to decrease. Because the burden time per response is greater for developing retirement/retrofit plans than for preparing and submitting an extension request (8 hours versus 30 minutes), some owners and operators of ODS
- containing CC and CR equipment 24 

### are expected to e xperience avoided reporting and recordkeeping costs. To estimate the incremental burden associated with submitting extension requests for IPR, CC, and CR equipment containing HFC refrigerants, the number of requests was estimated by scal ing based on the ra tio of affected ODS equipment to HFC equipment. **Invoices provided by service technicians**  **.** Under current regulations, persons servicing appliances normally containing 50 or more pounds of ODS refrigerant are required to provide invoices to appliance owners or operators indicating the amount of refrigerant added to the appliance . EPA is proposing to : 1) extend this requirement to appliances normally containing 50 or more pounds of HFC refrigerant, and 2) add new recordkeeping requirements associated with each refrigerant addition (see Section 1.2.2 for details). The analysis assumed that service technician s would need to provide invoices to appliance owners/operators four times per year for IPR and CR equipment with charge sizes 500 pound s or greater and one time per year for all CC equipment and IPR and CR equipment with charge sizes between 50 and 500 pou nds . Multiplying this invoice frequency by the number of affected equipment yields an annual estimate of approximately 1 . 3 million invoices for affected ODS equipment and approximately 1.1 million invoices for affected HFC equipment. Since technicians are already required to provide invoices when servicing ODS equipment, the only incremental burden for ODS equipment was assumed to be the time associated with providing documentation for the new recordkeeping requirements (i.e., 0.5 minutes). For servicing HF C equipment, t he same burden time per invoice as the ICR was assumed (i.e.,

23 Specifically, the analysis assumes that 50% of the ODS CC and CR systems that would have been prematurely retired under the current requirements instead apply for an extension. The baseline number of ODS system retirements was taken from EPA (2015b). 24 A pproximately 2,300 owners/operators.36 October 15, 2015



### 1.5 minutes) , plus 0.5 minutes to account for the new recordkeeping requirements associated with refrigerant additions. **Purchase and service records.** Under current regulations, owners or operators of IPR, CC, and CR appliances normally containing 50 or more pounds of ODS refrigerant must maintain purchase and service records. EPA is proposing to : 1) extend this requirement to equipment containing HFCs and other non
- exempt substitutes ; and 2) require equipment owners to maintain records of the information provided by service technicians associated with each refrigerant addition (see Section 1.2.2 for further details) . This analysis assumes that there is no incremental burden on owners of affected equipment to maintain the new information from service technicians associated with each refrigerant addition . However, owners or operators of affected HFC equipment are assumed to incur costs associated with the time burden for maintaining purchase and service records. Consistent with the ICR, 1.5 minutes of burden time is assumed each time an HFC appliance is serviced . T he total number of servicing events is assumed to be equal to the number of times that service technicians provide invoices (i.e., four times per year for IPR and CR equipment with charge sizes 500 pounds or greater and one time per year for all CC equipme nt and IPR and CR equipment with charge sizes between 50 and 500 pounds ). **Plans to retire/replace or retrofit equipment.** Under current regulations, owners or operators of IPR, CC, and CR appliances normally containing 50 or more pounds of ODS refrigerant must develop and maintain a plan to retire/replace or retrofit equipment after a failed follow
- up verification test. EPA is proposing to extend this requirement to IPR, CC, and CR appliances normally containing 50 or more pounds of HFC refrigerant. To cal culate the incremental recordkeeping costs associated with developing a plan to retire/replace or retrofit HFC equipment, the assumptions in the ICR for ODS equipment were scaled proportionately based on the ratio of affected ODS and HFC equipment. **Resul ts of verification tests.**  Section 608 regulations currently require initial and follow
- up verification tests each time the leak rate threshold is breached for both IPR appliances and federally
- owned CC and CR appliances normally containing 50 or more pound s of ODS refrigerant . EPA is proposing to extend this requirement to: 1) all equipment types, including CC and CR appliances that are not federally
owned; and 2) appliances normally containing 50 or more pounds of HFC refrigerant . The model facility assumptions described in Section 3.1.1.4 were used to identify the pool of newly affected equipment (i.e., CC and CR ODS equipment and all HFC equipment) and the expected number of times that the newly affected equipment would exceed the leak rate threshold on an annual basis . For every occurrence of an appliance exceeding the leak rate threshold, 1.5 minutes of burden time was assumed to maintain reports on the results of verification tests. **Leak inspections.** Leak inspections are currently not required under the Section 608 regulations. EPA is proposing to require : 1) quarterly inspections for all IPR and CR equipment containing a refrigerant charge of 500 or more pounds ; and 2) annual inspections for all IPR and CR equipment with a refrigerant charge between 50 and 500 pounds, plus all CC equipment with a refrigerant charge greater than 50 pounds . This analysis assume s that the recordkeeping time associated with quarterly and annual37 October 15, 2015



### inspections is one minute. The model facility assumptions (see section 3.1.1.4 ) were used to identify the affected pool of equipment. 

### 3.1.2.2. **Other Recordkeepi**  **ng and R** **eporting Requirements**  As also described in Section 1.2.2 , EPA is proposing to extend the following recordkeeping and reporting requirements to HFC refrigera nts and other substitutes :
 

### Reclaimer annual activity report**s .**  Refrigerant reclaimers must submit annual reports noting the mass of refrigerant reclaimed by refrigerant type and the mass of waste products produced .  

### Reclaimer recordkeeping. Reclaimers must maintain records of refrigerant sales transactions, including the quantity of material sent to them for reclamation .  

### Disposal establishments’ **refrigerant recovery recordkeeping**  **.** Persons disposing of air
- conditioning or refrigeration equipment must maintain a copy of a signed statement for e ach piece of disposed equipment that demonstrates all remaining refrigerant was recovered from the equipment before final disposal .  

### Refrigerant **wholesalers’ recordkeeping**  **.** Wholesalers of refrigerants must maintain sales records and technician certification cards from purchasers showing that they employ at least one certified technician .  

### Purged refrigerant recordkeeping. Owners/operators of appliances with charge sizes greater than 50 pounds must maintain information on pu rged/destroyed refrigerant. To estimate the incremental costs for an extension to HFCs and other non
- exempt substitutes for each of the abovementioned requirements, the burden estimates from the Program’s supporting ICR (EPA ICR Number: 1626.13, OMB Contro l Number: 2060
-0256) were scaled based on the ratio of ODS to HFC equipment stock . For recordkeeping and reporting requirements that pertain to reclamation, it was conservatively assumed that HFC reclamation would occur at the same rate as ODS reclamation . Other proposed recordkeeping and reporting provisions also include: **Certified technician database.** EPA is proposing to require certification programs to create and maintain a publicly
- available database or list of currently certified technicians. This a nalysis assumes negligible cost associated with this requirement, since it is anticipated to be fulfilled by maintaining and publishing a PDF list of certified technicians online. 25 

### Small can self**- sealing valve recordkeeping.**  EPA is proposing to add a new recordkeeping requirement for manufacturers of small cans of automotive refrigerant to keep records of test data and log forms that demonstrate compliance with the allowable leakage rate. To estimate the costs for the new small

25 A total annual labor cost of approximately $660 was estimated for technician certification programs to maintain a list of currently certified technicians. Specifically, i t was assumed that each of the 88 technician ce rtification programs would spend approximately 5 minutes updating the ir list of certified technicians twice a year, resulting in 15 total annual burden hours.38 October 15, 2015



### can recordkeeping requiremen t, it was assumed that filing test data and log forms would take approximately 1.5 minutes per test batch. Since the test procedure takes on average 30 days per batch , filing test data and log forms is assumed to occur on a monthly basis. **Recovery and rec ycling equipment certification of ownership.**  EPA is proposing to remove the requirement for persons who maintain, service, repair, or dispose of appliances containing ODS refrigerants to submit a signed statement that they own certified recovery and recycl ing equipment. T he removal of this requirement would result in a burden reduction for more than 2,600 affected service and disposal establishments. **Disposal of appliances with charge sizes between 5 and 50 pounds.**  EPA is proposing to require a new recordke eping requirement where technicians dispos ing of appliances with charge sizes between 5 and 50 pounds must d ocument how much refrigerant was recovered from the appliance at disposal and how much refrigerant is transferred for reclamation or destruction . To estimate the incremental burden associated with this new requirement, the total number of ODS and HFC appliances disposed of annually with charge sizes between 5 and 50 pounds from EPA’s Vintaging Model was multiplied by the perappliance burden time asso ciated with maintaining these records (assumed to be two minutes). Table 18 below shows the total number of ODS and HFC appliances containing between 5 and 50 pounds of refrigerant that are estimated to be disposed of annually.

**Table 18**  **. Appli**  **ances with Charge Sizes Between 5 and 50 Pounds Disposed in 2015 Equipment Type**  **Estimated Units Disposed in 2015**  **HCFC HFC**  **Total** Water and ground source heat pumps 68,240 0 68,240 Ice Makers 0 142,240 142,240 Small condensing units 72,970 7,790 80,760 Refrigerated transport 3,160 315,280 318,440 Residential unitary AC 6,302,760 99,080 6,401,840 Small commercial unitary AC 260,150 8,050 268,200 Large commercial unitary AC 15,440 0 15,440

**Total 6,722,720**  **572,440 7,295,160**  Source: EPA 2014. 

### The following recordkeeping and reporting requirements were assumed to have no incremental burden costs associated with an extension to HFCs and other substitutes:
 

### Maintenance of copies of signed statements of previous refrigerant recovery by disposal establishments . 26

26 It is assumed that time required to file these statements daily remains the same.39 October 15, 2015

 

### Refrigerant recovery and recycling e quipment t esting organizations s ubmitting reports on approved equipment and m aintain ing records of equipment tested .  

### Certification by refrigerant reclaimers that change ownership or enter the m arket .  

### Tec hnician certification programs applying for a pproval .  

### Record keeping and biannual reporting by existing technician certification p rograms .  

### Technicians a cquiring and maintaining certification c ards . 

## 3.1.3. **Self -** **s ealing Valves on DIY Small Cans**  Consistent with CARB’s Staff Analysis on Emissions and Economic Impact of Proposed Regulation for Small Containers of Automotive Refrigerant, t his analysis assumes that the extra cost to install a self
sealing valve on DIY small cans would be approximately $0.25 per can (CARB 2009 b ) . Using data from the NPD Automotive Aftermarket Industry Monitor, t he total number of small cans sold annually in the United States was multiplied by the cost per valve to arrive at the total annual incremental cost estimated to be incurred by smal l can manufacturers (NPD 2008 ; CARB 2009 b ) . 27 

### Small cans that are sold in the state of California were excluded from this analysis due to CARB’s existing requirement for all small can manufacturers to install self
- sealing valves, which became effective Octo ber 1, 2009. EPA also considered what the costs would be of extending the sales restriction to HFCs and other substitutes without an exemption for small cans of refrigerant for MVAC servicing. If EPA had extended the sales restriction without the exemption , DIYers would be required to either seek certification under section 609 or take their car to a technician to be serviced . As shown in Appendix F, extending the sa les restriction to small cans would be significantly more burdensome than the requirement to equip all small cans with a self
- sealing valve. 

## 3.1.4. **Extending Other Existing Requirements to HFCs and Other Substitutes: Implications for Costs**  While EPA is requiring specific practices to prevent release of refrigerant, including but not limited to requiring refrigerant be recovered from small appliances, MVACs, and MVAC
- like appliances before disposal, evacuation of refrigerant before opening an appliance for servicin g, and reclamation of used refrigerant to industry standards before sale, EPA has not assumed any additional cost to industry for this extension other than those discussed in Section 3.1 . Likewise, EPA has not calculated any of the benefits that would accrue if compliance were to increase as a result of this rulemaking (see Section 3.3 ) .

27 The NPD da ta was provided by nine companies, including Advance, AutoZone, CSK/Murrays, Pep Boys, O'Reilly’s, CARQUEST, NAPA, Strauss Auto, and Parts Alliance. It represents an average of the total HFC
- 134a small cans sold in the United States in 2006 and 2007.40 October 15, 2015



### This assumption is reasonable and appropriate because anyone handling HFC and other substitute refrigerants already must comply with the venting prohibition, which effectively necessitates similar practices to ensure refrigerant is not releas ed into the environment. This assumption is supported by feedback from numerous regulated entities both in the public and private sector that most in industry treat HFCs and ODS refrigerants the same way to comply with the venting prohibition. Thus, some of the regulatory changes that EPA is propos ing are not expected to result in compliance costs. Table 19 summarizes these regulatory changes and the rationales for assuming no incremental costs. **Table 19**  **: Regulatory Changes Assumed to Present No Incremental Cost**

**Recommended Regulatory Changes**  **Rationale for Assuming No Incremental Costs** **L e** **a k** **R e** **p a** **i r** **a n** **d P** **r e** **v e** **n t** **i o** **n**  Require all appliances to conduct initial and follow
- up verification tests (currently only applies to federal and IPR appliances) Industry input suggested that verification tests are already conducted as standard practice during servicing events. Moreover, because initial and follow
- up verification tests can both be conducted during the same service appointment, this requirement is not expected to result in a longer servicing event (and thus not expected to result in incre mental labor costs).  Require a leak inspection to identify leaks upon discovering that the a pplicable leak rate is exceeded This analysis assumes that equipment owners or operators are currently inspecting their equipment as part of a service call to identify what must be repaired upon discovering that the appliance exceeds the applicable leak rate.  Create an annual leak li mit of 75% for 2 consecutive years This regulatory change is expected to improve compliance and enforcement. However, b ecause the economic analysis presented in this document already assumes full compliance with the regulatory changes, it is assumed that qualifying leak events are identified and repaired within a one
-year period, such that equipment would not leak more tha n 75% of its total charge within two consecutive 12 - month period s .**P r** **e v** **e n** **t i** **n g** **E m** **i s** **s i** **o n** **s D** **u r** **i n** **g S** **e r** **v i** **c i** **n g**   Extend the sales restriction to non - exempt substitutes, thereby requiring technician certification and proper handling for HFCs This analysis assumes that all technicians currently servicing ODS equipment also service HFC equipment, and therefore, extending the sales restriction to HFCs would not result in any technicians needing to become newly certified.**V e** **n t** **i n** **g P** **r o** **h i** **b i** **t i** **o n**   Extend the de minimis exemption to HFCs and other substitute refrigerants This analysis assumes no costs associated with this extension because most stakeholders are already properly recovering substitute refrigerants during maintenance, servicing, repair, or disposal of appli ances as required under the venting prohibition. This requirement would likely mean minimal , if any, change in business practices other than the recordkeeping provisions discussed previously.41 October 15, 2015 **Recommended Regulatory Changes**  **Rationale for Assuming No Incremental Costs** **E v** **a c** **u a** **t i** **o n** **R e** **q u** **i r** **e m** **e n** **t s**   Extend evacuation requirements to HFCs and other substitute refrigerants This analysis assumes no costs associated with this extension because most technicians are already properly evacuating substitute refrigerants during maintenance, servicing, repair, or disposal of appliances as required un der the venting prohibition . This requirement would likely mean minimal , if any, change in business practices .**R e** **c o** **v e** **r y** **E q** **u i** **p m** **e n** **t C** **e r** **t i** **f i** **c a** **t i** **o n**   Extend the requirement to use certified recovery equipment during the maintenance, service, repair, or disposal of appliances, other than MVACs and MVAC
like appliances, that contain HFCs or other substitute refrigerants This analysis assumes no costs associated with this extension since the existing pool of recycling and recovery equipment are already expected to meet certification requirements and can be used to recover both ODS refrigerants and fluorocarbon substitutes. Additionally, EPA assumes full compliance with the venting prohibition, which would necessitate recovery of all non
exempt refrigerants.**S a** **f e** **D i** **s p** **o s** **a l**   Extend requirements for the safe disposal of appliances to HFCs or other substitute refrigerants This analysis assumes no costs associated with this extension because most technicians are already properly evacuating substitute refrigerants during maintenance, servicing, repair, or disposal of appliances as required under the venting prohibition. This requirement would likely mean minimal, if any, change in busines s practices other than the recordkeeping provisions discussed previously.**R e** **c l** **a m** **a t** **i o** **n**  Extend reclamation standards in Appendix A ( currently based on ARI Standard 700
- 1995, Specification for Fluorocarbons and Other Refrigerants ) to HFCs and other substitutes This analysis assumes no costs associated with this extension because refrigerant recovered and reclaimed from disposed appliances must be of a certain purity to effectively be used in the appliance service sectors . Additionally, feedback from industry indicates that reclaimers use the same processes and practices when they reclaim HFCs as they do for ODS.**T e** **c h** **n i** **c i** **a n** **C e** **r t** **i f** **i c** **a t** **i o** **n**  Extend certification requirements to technicians who work with HFCs and other substitute refrigerants This analysis assumes no costs associated with this extension because the pool of currently certified technicians is assumed to work with both ODS and substitute refrigerants. Many companies already require certification of their technicians regardless of the type of refrigerant being used . Further, EPA is not requiring cur rently certified technicians to recertify under this provision.  Require technician certification programs to offer tests to technicians who work with HFCs and other substitute refrigerants This analysis assumes no costs associated with this extension be cause certification programs will not need to change current practices to offer tests for these technicians. Further, EPA is not proposing to require certification programs to recertify .**G r** **a n** **d f** **a t** **h e** **r i** **n g** **P r** **o v** **i s** **i o** **n s**   R emove provisions related to voluntary certification programs This analysis assumes no costs associated with removing provisions related to voluntary certification programs since the provisions are deemed no longer necessary.42 October 15, 2015 **Recommended Regulatory Changes**  **Rationale for Assuming No Incremental Costs** **C e** **r t** **i f** **i c** **a t** **i o** **n C** **a r** **d s**   C hange the required text that is printed on cert ification cards This analysis assumes the costs associated with this change are negligible and may actually ease burden on refrigerant wholesalers who must inspect the cards to verify the certification of technicians . 

# 3.2. **Approach for Estimating the**  **Economic Impact on Small Entities**  The sections below describe the method and assumptions used to estimate the economic impact on small entities associated with proposed regulatory changes related to: leak inspection and repair, reporting and recordkeeping, and self
- sealing valves on DIY small cans. 

## 3.2.1. **Leak Inspection and Repair Model Facility**  **and Entity Assumptions**  The RFA/SBREFA screening analysis uses most of the assumptions and methodological steps presented above for the aggregate economic analysis, in Section 3.1.1 . Different model facility scenarios were developed, however, to more accurately reflect the range of compliance costs that a given small business owner or operator could experience. For each facility, there are many potential configurations of equipment types, refrigerant, leak rates, and repair outcomes. For example, a food manufacturer with one comfort cooling system and two commercial refrigeration system s could have the comfort cooling system exceed the leak rate threshold and conduct a standard repair, while the two commercial refrigeration systems do not exceed the leak rate threshold. Or, the comfort cooling system could exceed the leak rate threshold and require a retrofit, while the commercial refrigeration systems are maintained below the threshold. Or, alternatively, the two commercial refrigeration systems could exceed the leak rate threshold and require an extension repair, while the comfort cooli ng system does not exceed the threshold. Multiple other configurations are possible within this single example and across all of the other industry categories. Considering these multiple possibilities, “worst case” model facility assumptions were adopted. The “worst case” reflects the possibility that equipment with leak rates above the proposed threshold are clustered in individual facilities, such that all of the eligible equipment in a single model facility might trigger repair requirements. Within each facility, it is assumed that multiple units of the same equipment type are maintained in the same way ( e.g ., if a facility has two commercial refrigeration systems, both pieces of equipment are assumed to have similar leak rates), and thus experience the s ame leak repair outcomes. Model facility scenarios were developed for each industry category based on how many different types of equipment the industry is assumed to use and the expected number of extension requests and retrofits. Each scenario features a different combination of equipment and leak repair outcomes. In Box 5 below, the Agricultural and Crop Support Services industry (Ag/Crop) is used to illustrate how this method was applied.43 October 15, 2015 **Box 5**  **: Model Facility Approach for the Agricultural and Crop Support Services**  **Industry** In the Ag/Crop industry, a total of about 1,140 commercial refrigeration systems and 728 comfort cooling systems are estimated to be affected by the proposed rule. Each Ag/Crop facility is assumed to have two commercial refrigeration systems and one comfort cooling system. Therefore, 570 facilities (1,1,40 ÷ 2) are assumed to have two commercial refrigeration systems and one comfort cooling system with leak rates above the proposed threshold. The remaining 158 facilities (728 – 570) have one comfort cooling system with leak rates that exceed the proposed threshold. The 570 facilities with all three pieces of affected eq uipment were further broken down by the potential repair outcomes for the affected equipment. Because the extension requests and retrofits result in the highest compliance costs incurred, these leak repair outcomes drove the model facility scenarios. The n umber of extension requests and retrofit requests were apportioned to each industry by multiplying the percentage of affected equipment (by sector and industry) by the total number of extension requests and retrofits expected across all industries. For th e Ag/Crop industry, 8 pieces of commercial refrigeration equipment are estimated to undergo retrofit in a given year. Assuming that both pieces of commercial refrigeration equipment at a facility will experience the same leak repair outcome, 4 facilities a re assumed to have two pieces of commercial refrigeration equipment retrofitted. The comfort cooling systems at those 4 facilities are assumed to undergo a standard repair. Similarly, 18 pieces of commercial refrigeration equipment are assumed to request a n extension repair, so 9 facilities are assumed to have two commercial refrigeration units with extension repairs and one comfort cooling system with a standard repair. This matrix approach is applied until all equipment outcomes are distributed among faci lities, as shown in the table below.
**Number of Facilities Comfort Cooling Units**  **Commercial Refrigeration Units Standard**  **Extension Retrofit**  **Standard Extension**  **Retrofit** Facilities with only 1 CC Affected

158 1 Facilities with 1 CC and 2 CR Affected

4 1 2 9 1 2 5 1 2 12 1 2 540 1 2 

### Expected compliance costs per model facility were estimated by multiplying the unit cost assumptions described in Section 3.1.1.3 plus the expected reporting and recordkeeping costs per facility, by the model facility configurations for each industry sector. Costs to small businesses were then scaled based on the proportion of facilities
-to -entities for small businesses in each NAICS code in each industry category. To be conservative, this analysis does not include the avoided compliance costs associated with the proposed flexibility for owners or operators of ODS CC and CR appliances to request additional time to make repairs due to the unavailability of components. While this flexibility is expected to result in fewer ODS appliances being retired prematurely, these avoided costs are not reflected in the small business i mpacts analysis.44 October 15, 2015



## 3.2.2. **Reporting and Recordkeeping** The compliance costs associated with reporting and recordkeeping that are incurred by affected equipment owners and operators are included in the model facility calculations described above. This section addre sses the costs to other small entities subject to reporting and recordkeeping requirements, including reclaimers, disposal establishments, service establishments, refrigerant wholesalers, small can manufacturers, and service technicians . 28 

### Table 20 below shows potentially affected industries by reporting and recordkeeping requirement (see also Section 2.2 ) . **Table 20**  **. Potentially Affected Industries for Reporting and Recordkeeping Requirements**  **Reporting and Recordkeeping Requirement**  **Industry NAICS Code and Definition**  Reclaimer annual activity reports and recordkeeping Reclaimers 325120 Industrial Gas Manufacturing 423930 Recyclable Material Merchant Wholesalers 562920 Materials Recovery Facilities 562212 Solid Waste Landfill 424690 Other Chemical and Allied Products Merchant

Wholesalers Refrigerant wholesalers recordkeeping for refrigerant sales, including maintenance of technician certification cards from purchasers employing at least one certified technician Refrigerant Wholesalers 325120 Industrial Gas Manufacturing

424690 Other Chemical and Allied Products Merchant

Wholesalers 42 Wholesale Trade New recordkeeping requirement to document how much refrigerant was recovered from 5
- 50 lb. appliances at disposal and the fate of that refrigerant Service Technicians 238220 Plumbing, Heating, and A ir- c onditioning C ontractors
New recordkeeping requirement to keep records of self
- sealing valve test data and log forms Small Can Manufacturers 441310 Automotive Parts and Accessories Stores

325120 Industrial Gas Manufacturing Removal of certification requirement for d isposal e stablishments that change o wnership or e nter the m arket Disposal Establishments 562920 Materials Recovery Facilities

562212 Solid Waste Landfill 423990 Other Miscellaneous Durable Goods Merchant

Wholesalers

28 As noted in Section 2.2 , d isposal and service establishments are expected to experience cost relief due to EPA’s proposal to remove the requirement to submit a signe d statement to show ownership of certified recovery and recycling equipment.45 October 15, 2015

**Reporting and Recordkeeping Requirement**  **Industry NAICS Code and Definition**  Removal of certification requirement for o wners of refrigerant recovery/ recycling e quipment that change ownership or enter the market Service Establishments 811310 Commercial Industrial Machinery and Equipment (not Automotive and Electronic ) Repair and Maintenance 811412 Appliance Repair and Maintenance


### To determine the incremental cost per firm to comply with the proposed changes to recordkeeping and reporting requirements, t he total aggregate incremental costs were divided by the total number of affected businesses in each industry. For example, the aggregate incremental costs for reclaimers represents the sum of the incremental costs associated with: 1) reclaimer annual activity reports ; and 2 ) reclaimer recordkeeping (i.e., $ 1 2 , 011 + $ 1 5 , 014= $ 2 7, 025 ). This number was then divided by 61 , representing the number of certified refrigerant reclaimers affected by the pro posed changes (i.e., $ 27 , 025/61 = $ 443/per certified refrigerant reclaimer ). T his conservative approach likely overestimates costs for small businesses by assuming equal burden regardless of business size. 

## 3.2.3. **Self -** **s ealing Valves on DIY Small Cans**  To estimate the cost per entity to install self
- sealing valves, total annual sales of DIY small cans were distributed across the manufacturers using a weighted average of total small can Stock Keeping Units (SKUs) and share of total sales volume . For small businesses, t his number was then multiplied by the cost to install a self
- seali ng valve, which is assumed to be $0.25 per can
. 29 

# 3.3. **Approach for Estimating Benefits**  The sections below describe the method and assumptions used to estimate aggregate benefits associated with propose d regulatory changes related to leak inspection and repair and self
- sealing valves on DIY small cans. In addition, the methodology for estimating future benefits in 2020 and 2025 of the leak inspection and repair proposed regulatory changes is presented. The environmental benefits are the annual GHG emissions avoided (MTCO 2 

### e q ) and annual ODS emissions avoided (ODP
-weighted MT) as a result of the proposed regulatory changes. 

## 3.3.1. **Emission Reduction Benefits**  **of Leak Inspection and Repair 3.3.1.1.**  **Annual Benefits of Leak**  **Inspection and Repair**  Similar to the methodology for estimating costs and savings, benefits were estimated us ing a model equipment, facility, and entity approach. Benefits were then scaled up industry
-wide based on the

29 Annual sales of DIY small cans sold in California were excluded from this analysis. Cans sold in California are already requi red to have a self
- sealing valve per CARB regulation s.46 October 15, 2015



### proportion of businesses that could be affected by the regulation in order to determine the full im pact of each of the proposed changes. Benefits are calculated as the refrigerant emissions prevented by repairing or retrofitting a leaking system earlier. Avoided refrigerant emissions are calculated based on the difference between the baseline and post
- repair leak rates (shown in Section 3.1.1.2 above) , multiplied by the charge size, over the three weeks earlier that each repair was conducted. The amount of avoided refrigerant emissions is weighted by an average ODP (for ODS systems) and GWP (for ODS and HFC systems). ODP and GWP values were estimated as a weighted average of the refrigerant GWP or ODP (using IPCC AR4 values) and charge size for each equipment type and size , based on 2013 data reported under California’s RMP. 30 

### Table **21 : Average GWP and ODP Assumptions by Equipment Type, Size, and Refrigerant Type**  **Sector Equipment Type**  **Equipment Size Refrigerant Type**  **Weighted -** **Average ODP**  **Weighted -** **Average**

**GWP** CC Unitary AC Small ODS 0.05 1,816 HFC - 2,349 Chiller Medium ODS 0.05 1,716 HFC - 2,044 Chiller Large ODS 0.05 1,414 HFC - 1,544 CR Condensing Unit Small ODS 0.03 3,140 HFC - 3,792 Rack Medium ODS 0.05 2,191 HFC - 3,644 Rack Large ODS 0.05 1,861 HFC - 3,860 Cold Storage Medium ODS 0.05 1,839 HFC - 3,726 Cold Storage Large ODS 0.06 1,810 HFC - 3,984 IPR IPR Small ODS 0.02 2,788 HFC - 3,957 IPR Medium ODS 0.04 1,076 HFC - 3,234

30 The ODP and GWP values used in this analysis are based on weighted refrigerant use by each equipment type. Refrigerants included in the analysis can be found in Table 5 .47 October 1 5, 2015

**Sector Equipment Type**  **Equipment Size Refrigerant Type**  **Weighted -** **Average ODP**  **Weighted -** **Average**

**GWP** IPR Large ODS 0.05 1,556 HFC - 1,860 

### The benefits for the extension repair are assumed to be e quivalent to the benefits of a standard repair, as this analysis does not take into account the additional 30 days that the system is leaking between filing the extension and when the actual repair takes place , which could result in overestimating the avoided emissions as a result of the extension request. However, beca use system s requiring an extension repair have typically more complicated or catastrophic leaks, an extension repair as a result of the proposed regulatory changes would still be taking place earlier than it would under the baseline scenario, and emissions would still be avoided. No emission b enefits associated with retrofit and replacement are assumed, as the proposed rule does not require equipment that is repaired or retrofitted to be initially repaired. Furthermore, b ecause this analysis only considers a one
-year period, it does not include benefits from preventing a chronically leaking system from continued operation over a longer time period than one year, nor does it include the benefits of an accelerated transition to alternative refrigerants that may have lower GWPs. On a per system basis, effective benefits range from 3 MTCO 2 

### e q for small comfort cooling HFC systems up to more than 200 MTCO 2 

### e q for very large IPR systems. **Model Equipment Expected**  **Benefits** . Expected benefits per model equipment were estimated on a weighted basis, taking into account the proportion of equipment assumed to reach each leak repair outcome (see Table 13 above) and the avoided refrigerant emission s associated with each outcome. Expected benefits were estimated in the model in a disaggregated manner, distinguishing between equipment sectors, types, sizes, and refrigerant type. **Model Facility Assumptions** . To estimate expected benefits per model facility, the expected avoided refrigerant emission s per model equipment type (as described above) were multiplied by the number of each type of equipment per facility and the percentage of each type of equipment as sumed to experience leaks above the proposed rule’s threshold rate (see Table 17 above) . In the final step, the expected avoided refrigerant emission s per model facility were multiplied by the total number of facilities in each industry category and the percentage of each industry assumed to be affected. These calculations yield aggregate benefits for the U.S. as a whole. More detailed assumptions about model facilities are summarized above in Section 3.1.1.4 . 

### 3.3.1.2. **Future Annual Benefits of Leak**  **Inspection and Repair**  The analysis described above estimates one
-year benefits based on the current distribution of ODS and HFC equipment in use. However, because the use of HFCs and ODS will change over the next decade due to multiple factors, including the continued phase
-out of ODS systems and EPA’s rulemaking, Protection of Stratospheric Ozone: Change of Listing Status for Certain Substitutes under the Significant New48 October 15, 2015



### Alternatives Policy Program (Status Change Rule) ( 8 0 FR 42869 ) , benefits for the proposed regulatory changes to the Program will also change . Future benefits were estimated us ing a model equipment, facility, and entity approach . Benefits were then scaled up industry
-wide based on the total number of affected equipment anticipated for two points in the future: 2020 and 2025. In order to simplify the process of determining the number of affected equipment and the benefits of lea k repair in 2020 and 2025 , several assumptions were made:
 

### Equipment used in 2020 and 2025 i s assumed to have the same leak rate s and charge size s as equipment today .  

### The same proportion of standard repairs, extension requests, and retrofit/ retirements are assumed for 2020 and 2025.  

### The affected ODS and HFC equipment in 2013 is assumed to grow according to the growth rate, lifetime, and transitions in EPA’s Vintaging Model — with the adjustments described below. Growth in stock of HFC equipment was slightly adjusted to ensure that the analysis accurately reflects other rulemakings that affect the same equipment sectors . EPA’s Status Change Rule make s certain HFCs unacceptable for use in some of the equipment affected by the Program, specifically commercial refrigeration equipment (i.e., rack systems and condensing units). Benefits from the transition away from HFCs were quantified and presented in EPA’s analysis Climate Benefits of the SNAP Program Status Change Rule ( Docket No. EPA- HQ- OAR - 2014-0198 -0239 ). In order to avoid double
- counting benefits, this analysis assumes that HFC commercial refrigeration equipment begins transitioning away from HFCs in accordance with the “most likely” transition scenario presented in the Benefits Analysis for the Status Change Rule. Equipment - specific average ODP and GWP values were also updated to reflect the specific mix of ODS and HFC refrigerants assumed in 2020 and 2025 . Benefits on a per
-equipment basis were then calculated in the same manner outlined in Section 3.3.1.1 and were multiplied by the estimated affected equipment in 2020 and 2025 described above . 

## 3.3.2. **Emission Reductions Benefits of Installing Self -** **s ealing Val**  **v es on Small**  **Cans 3.3.2.1.**  **Annual Benefits of Installing Self** **- s**  **ealing Valves on Small Cans** The following equation was used to calculate annual emissions avoided from the installation of self
sealing valves on DIY small cans:

(
− ) × × × 0 . 00045359 × = Where:49 October 15, 2015 

### = Annual sales of R
- 13 4a small cans to DIY m arket in United States ; assumed to be approximately 14 million
= Annual sales of R
- 134a small cans to DIY market in California ; assumed to be approximately 1.8 million = Charge size per small can (0.75 lbs. ) = Percent of initial mass contained in the can that is directly emitted during the charging procedure (i.e., servicing loss rate) ; assumed to be 11% 0 . 00045359 = Factor used to convert from lbs. to MT

= Global warming potential of R - 134a ; assumed to be 1,430 = Annual avoided emissions (MTCO 2 

### eq.) As a first step in the calculation, the number of R - 134a small cans that are sold annually to the DIY market in the United States and California were estimated based on data from NPD Automotive Aft ermarket Industry Monitor (NPD 2008; CARB 2009 b ). Small cans sold to the DIY market in California were excluded from this analysis since they already have self
- sealing valves per CARB regulations . Then, the amount of refrigerant sold annually to the DIY market (excluding sales in California) was calculated assuming that each small can contains 12 ounces of refrigerant (0.75 lbs. ) . To estimate the total mass of refrigerant that would have been directly emitted during the DIY charging procedure without a s elf
- sealing valve , it was assumed that 11% of the total initial mass is directly emitted to the environment during the DIY charging procedure ( CEP -Armines 2008 ). The inclusion of a self
- sealing valve is expected to reduce release durin g service to negligib le levels, and thus, for the purposes of this analysis, it was assumed that 100% of the refrigerant emitted during servicing is prevented by the valve. Emissions from the can heel are conservatively assumed to remain the same as cans without a self
- sealing valve, and therefore are excluded from the benefits analysis. The heel that remains in the can may be emitted to the environment during extended storage periods or when landfilled (Zhan et al. 2014). As a last step, the total mass of refrigerant loss prevented by the self
sealing valve was converted to metric tons of carbon dioxide equivalent (MTCO 2

### eq.) assuming a GWP of 1,430 from IPCC’s fourth assessment report (AR4). Although this analysis conservatively assumes that self
- sealing valves will only nega te emissions from servicing losses, there also may be emission benefits associated with the can heel. Having a self
- sealing valve would likely change the percentage and number of cans used per recharge, but no data are available to quantify this effect at this time . 

### 3.3.2.2. **Future Annual Benefits of Self -**  **s ealing Valves**  The analysis described above estimates one
-year benefits based on the current number of R
- 134a small cans that are sold annually to the DIY market. However, due to recent rulemakings, including 1) th e joint rulemaking issued by EPA and the National Highway Traffic Safety Administration (NHTSA) to establish light
- duty vehicle (LDV) GHG emission standards and Corporate Average Fuel Economy (CAFE) Standards and 2) EPA’s Status Change Rule ( 80 FR 42869 ), the amount of R
- 134a refrigerant sold to the DIY market50 October 15, 2015



### is expected to decline over the next decade. As a result, the estimated benefits for this proposed regulatory requirement are also expected to decline. To estimate the future benefits, current benefits were scaled down based on the Vintaging Model’s projected stock of R
- 134a MVAC units in years 2020 and 2025. The Vintaging Model’s projected stock of R - 134a MVAC units i ncorporates assumptions from the Tech nical S upport D ocument for EPA/NHTSA’s final rule, which assumes that in 2017 20% of the U.S. market will adopt alternative MVAC systems, and that in each subsequent year the market penetration wil l increase an additional 20%, reaching 100% by 2021 (EPA/NH TSA 2012). This analysis assumes that as the market transitions to alternative MVAC systems, DIYers are more likely to have their vehicles serviced by a certified technician . 31 

## 3.3.3. **Extending Other Existing Requirements to HFCs and Other Substitutes: Implications for Benefits**  While EPA is proposing specific practices to prevent release of HFCs and other substitute refrigerant, including but not limited to requiring refrigerant be recovered from small appliances, MVACs, and MVAC- like appliances before d isposal, evacuation of refrigerant before opening an appliance for servicing, and reclamation of refrigerant to industry standards before sale for use, EPA has not calculated any of the benefits that would accrue if compliance were to increase as a result of this rulemaking. As noted above in Section 3.1.4, t his assumption seems reasonable because anyone handling HFC and other substitute refrigerants already must comply with the venting prohibition, which effectively necessitates similar practices to ensure refrigerant is not released into the environment. This assumption is supported by feedback from numerous regulated entities both in the public and private sector that most in industry treat HFCs and ODS refrigerants the same way to comply with the venting prohibition. Assuming no additional benefits also results in a conservative assessment of the benefits of this rule.

31 The analysis does not estimate changes in benefits that might be associated with DIY servicing of MVAC systems containing R - 1234yf. DIY small cans containing this substitute are currently not available due in part to the need for unique fittings. If such technology is developed in future, emissions are assumed to be negligible due to the low GWP of R
- 1234yf (i.e., 4).51 October 15, 2015



# 4. **Aggregate Economic Impact**  **Analysis** This section summarizes the estimated impacts on the entire U.S. economy associated with th e Agency’s proposed regulatory changes to Section 608 of the CAA. These results were generated for the industries and equipment types characterized in Section 2 , us ing the modeling approach and methodology described in Section 3 . All costs and savings are provided in 2014 dollars. To provide a full range of costs, savings, an d benefits estimates, Appendix A presents the results of several sensitivity analyses across different assumption dimensions:
 

### Appendix A.1 : CARB distribution of ODS and HFC refrigerant s by equipment type, rather than Vintaging Mode l .  

### Appendix A. 2 : 200 pound threshold for annual and quarterly leak inspection for CR and IPR equipment, rather than 500 pounds .  

### Appendix A.3 : H igher post - repair leak rates set at 90% of the threshold leak rate ( e.g ., if the threshold rate is 20%, it is assumed that the system is repaired and has a resulting leak rate of 18%) , rather than the rates in Table 14 .  

### Appendix A.4 : 3% discount rate , rather than 7% .  

### App endix A.5 : Leak repairs are conducted two weeks earlier, rather than three weeks.
 

### Appendix A.6 : Leak repairs are conducted two month s earlier, rather than three weeks .  

### Appendix A.7 : Lower threshold leak rates of 5% for CC and 15% for CR and IPR, rather than 10% for CC and 20% for CR and IPR .  

### Appendix A.8 : Higher IPR threshold leak rates of 15% for CC, 25% for CR, and 30% for IPR, rather than 10% for CC and 20% for CR and IPR . 

# 4.1. **Annual Compliance Costs**  EPA’s proposed changes to the Section 608 regulations are expected to result in annual compliance costs of approximately $ 63 million, as shown in Table 22 . This amount includes new compliance costs of approximately $113 million associated with the proposed rulemaking, as well as avoided compliance costs of approximately $50 million associated with the proposed rem oval of some existing regulatory requirements and provision of additional flexibility that are expected to reduce regulatory burden.

**Table 22**  **. Annual Compliance Costs by Rule Component (2014$) Rule Component**  **Compliance Costs HFC**  **ODS TOTAL** 52 October 15, 2015 **Rule Component Compliance Costs**  Leak Inspection CC, CR , and IPR 50
-500 lbs. $17,409,000 $16,822,000 $34,231,000 CR and IPR ≥500 lbs. $21,777,000 $27,536,000 $49,314,000 Leak Repair CC $5,046,000
- $ 38,191,000 - $33,145,000 CR $1,709,000
- $ 10,137,000 - $8,428,000 IPR $494,000 $39,000 $ 533 ,000 Reporting & Recordkeeping $11,304,000 $ 5,789,000 $17,093,000 Self
- s ealing Valves on Small Cans $3,070,000
- $3,070,000 **Total $60,809,000**  **$ 1,858,000**  **$62, 668** **,000** Totals may not sum due to independent rounding. More detailed results tables for reporting and recordkeeping can be found in Appendix B . 

# 4.2. **Annual Refrigerant Savings** Total annual operating savings associated with reduced refrigerant use are estimated to be $ 5 2 million. Table 23 below shows the annual savings by rule component. As noted in Section 3.1.1 , the combination of pro posed leak repair and inspection requirements is expected to result in refrigerant savings for system owners or operators due to earlier leak repair action. **Table 23**  **. Total Annual Refrigerant Savings (2014$) , Compliance Costs,**  **and Combined Annual**  **Compliance Cost**  **s and**  **Refrigerant Savings**  **Rule Component Annual Refrigerant Savings**  **Compliance Costs**  **Combined Annual**

**Refrigerant Savings and Compliance Costs**  **HFC ODS**  **Total** Leak Inspection CC, CR , and IPR 50
-500 lbs.
- - - $34,231,000 $34,231,000 CR and IPR ≥500 lbs.
- - - $49,314,000 $49,314,000 Leak Repair CC - $15,977,000
- $20,221,000
- $36,198,000
- $33,145,000
- $69,343,000 CR - $4,130,000
- $7,514,000
- $11,644,000
- $8,428,000
- $20,072,000 IPR - $2,074,000
- $2,240,000
- $4,314,000 $ 533 ,000 - $3,781,000 Reporting & Recordkeeping **- -**  **-** $17,093,000 $17,093,000 Self
- s ealing Valves on Small Cans **- -**  **-** $3,070,000 $3,070,000 **Total -** **$22,181,000 -** **$29,975,000 -** **$52,156,000 $62,668,000**  **$10,512,000**

Totals may not sum due to independent rounding.53 October 15, 2015



# 4.3. **Annual Emission Reduction Benefits**  The Agency’s proposed regulatory changes to Section 608 of the CAA are expected to reduce both GHG and ODS emissions. Total annual GHG emissions avoided in 2015 from the proposed regulatory changes are expected to be approximately 7 . 5 MMTCO 2 

### eq. Total ODS emissions avoided from the proposed regulatory changes are expected to be 116 ODP -weighted MT . Table 24 below shows the annual GHG and ODS emissions avoided from HFC and ODS refrigerants by rule component. **Table 24**  **. Annual GHG and ODS**  **Emissions Avoided in 2015** 

**Rule Component GHG Emissions Avoided**  **(MTCO 2** **eq) ODS Emissions Avoided**  **(ODP -** **weighted MT) HFC**  **ODS Total**  **ODS** Leak Inspection and Repair CC 1,425,000 2,487,000 3,912,000 78 CR 1,246,000 1,077,000 2,323,000 30 IPR 381,000 250,000 630,000 8 Reporting & Recordkeeping **- -**  **- -**  Self
- s ealing Valves on Small Cans 657,000 **-** 657,000 **- Total**  **3,709,000 3,814,000**  **7,522,000 116**  Totals may not sum due to independent rounding. 

# 4.4. **Looking Forward: Emission Reduction**  **Benefits in 2020 and 20 2**  **5 Leak**  **inspection and repair.**  T he distribution of ODS and HFC equipment in use is anticipated to change significantly over the next decade, resulting in different leak inspection and repair benefits for 2020 and 2025. **Self -** **sealing valves on small cans.** The number of R
- 134a small cans sold annually to the DIY market is also expected to change over the next decade, resulting in different benefits for 2020 and 2025. Table 25 and Table 26 below show the annual GHG emissions avoided from HFC and ODS refrigerants by rule component. **Table 25**  **. Annual GHG Emissions Avoided in 2020 (MTCO 2** 

### eq.) **Rule Component 2020**  **HFC ODS**  **Total** Leak Inspection and Repair CC 2,382,000 1,316,000 3,698,00054 October 15, 2015 **Rule Component 2020**  CR 1,902,000 769,000 2,671,000 IPR 723,000 255,000 978,000 Self
-Sealing Valves on DIY Small Cans 537,000 0 537,000 **Total 5,544,000**  **2,340,000 7,884,000**  Totals may not sum due to independent rounding. 

### Table **26 . Annual**  **GHG Emissions Avoided in 2025 (MTCO 2** 

### eq.) **Rule Component 2025**  **HFC ODS**  **Total** Leak Inspection and Repair CC 3,367,000 526,000 3,893,000 CR 2,286,000 440,000 2,726,000 IPR 927,000 224,000 1,151,000 Self
-Sealing Valves on DIY Small Cans 339,000 0 339,000 **Total 6,919,000**  **1,190,000 8,109,000**  Totals may not sum due to independent rounding. 

### Total ODS emissions avoided from the proposed leak repair regulatory chan ges in 2020 are expected to be 80 ODP -weighted MT and in 2025 are expected to be 44 ODP -weighted MT. Table 27 below shows the range of annual ODS emissions avoided by rule component.

**Table 27**  **. Annual ODS Emissions Avoided in 2020 and 2025 (ODP -** **weighted MT)**

**Rule Component 2020**  **202 5**  **ODS ODS**  Leak Inspection and Repair CC 48 23 CR 23 13 IPR 8 8 **Total 80**  **44** Totals may not sum due to independent rounding. 

# 4.5. **Other Benefits** The Agency’s proposed changes to Section 608 of the CAA may result in other economic, health, and environmental benefits that are not quantified or monetized in this conservative analysis. Some of these potential benefits include the following :55 October 15, 2015



### Energy savings from leak repair . In addition to the financial impacts associated with replacing refrigerant from leaking systems, refrigeration and air
- conditioning equipment may operate poorly when the charge is too low, resulting in higher energy costs. System performance is dependent on the charge level in the system and an underch arged system can use significantly more energy than an optimally charged one ( Cowan, et al . 2010) . Energy savings would also take place when leaking, inefficient systems are replaced with new, more energy
- efficient systems. This analysis does not quantify the benefits of improved equipment performance from leak repair and retirement/replacement, although these benefits could be significant. **Reporting and recordkeeping** . Emission s b enefits associated with proposed changes to reporting and recordkeeping were n ot estimated . H owever, these requirements are anticipated to result in improved compliance with the Section 608 requirements, particularly for leak inspection , leak repair, and proper refrigerant recovery upon disposal of appliances . In addition, reporting and recordkeeping may encourage better equipment management practices, which could lead to faster repairs and better maintenance , and consequently reduced expense to system owners and increased environmental benefits. Benefits associated with the propose d recordkeeping requirement for disposing of field
- installed appliances with charge sizes between 5 and 50 pounds were also not estimated. However, it is assumed that this new requirement will address a significant portion of potential emissions during equ ipment disposal. Based on estimates from EPA’s Vintaging Model, the stock of refrigerant contained in field
installed appliances with charge sizes between 5 and 50 pounds that are disposed of annually contain a total of 27,300 MT of refrigerant (49.5 milli on MTCO 2 

### eq. , 960 ODP -weighted MT), representing 45% of the total amount of HCFC and HFC refrigerants charged into all appliances being disposed annually (EPA 2014). **Extending s**  **ervicing p**  **ractice d**  **isposal r** **equirements to s**  **ubstitutes** . This analysis assumes servicing and disposal practices for HFCs and other substitutes are similar to those required for ODS refrigerants in order to comply with the venting prohibition. Extending these explicit requirements to HFCs and other substitutes could result in better c ompliance with the existing regulations for ODS appliances . Additionally, consistent standards for all refrigerants (except those that are exempt from the venting prohibition) should increase compliance, resulting in more benefits than are estimated in thi s analysis . **Human health benefits** . Ozone depletion, caused by the release of CFCs and HCFCs, is associated with many adverse health effects, including melanoma skin cancer, non
- melanoma skin cancers (e.g., basal cell carcinoma and squamous cell carcinoma), and cataracts . Reducing ODS emis sions through the proposed regulatory changes to the Program will reduce the damages associated with ozone depletion. 32

32 Human health benefits from reducing ODS emissions have historically been estimated using EPA’s Atmospheric Health Effects Framework (AHEF) model.56 October 15, 2015



### Materials **and crop d**  **amage and ecological b** **enefits** . Some materials, such as polymers, are susceptible to photodegradation when exposed to ultraviolet (UV) B radiation. UV B radiation has also been shown to reduce crop yields. Other ecological effects of UV radiation can include impacts on recreational fishing, forests, overall marine ecosystems, and some plant types (EPA 1999) . A reduction in UV radiation would extend the life of these materials and resources and result in physical and economic benefits (EPA 2011). 

# 5. **Small Entities Impact Analysis**  This screening analysis finds that the proposed rulemaking can be presumed not to have a **signific ant**  **economic impact on a substantial number of small entities (SISNOSE)**, as described below. Th is section describes the decision matrix used to make this determination and the aggregated small business impacts. 

# 5.1. **Decision Matrix for Determining Significant E conomic Impact on a**  **Substantial Number of Small Entities** This analysis uses the matrix shown in Table 28 to determine whether this rulemaking would impose a SISNOSE. The economic threshold levels are set conservatively at 1% and 3% of sales, consistent with similar analyses o f other Clean Air Act Title VI rules. These thresholds are set conservatively because the propose d rulemaking affects small businesses in a range of different industries, which may have significantly different profit margins and abilities to pass compliance costs along to customers. Based on this decision matrix, this screening analysis finds that the proposed rulemaking can be presumed to have **no SISNOSE.**  **Table 28**  **. Decision Matrix for Certifying SISNOSE Economic Impact**  **Number of Small Entities Subject to the Rule and**  **Experiencing Given Economic Impact**  **Percent of All Small**

**Enti ties Subject to the Rule**  **That A**  **re Experiencing Given Economic Impact**  **Certification Category Less than 1% for all**  **affected small entities** Any number Any percent Presumed No SISNOSE

**1% or more for one or more affected small**  **entities** Fewer than 100 Less than 20 percent Presumed No SISNOSE Fewer than 100 20% or more Uncertain – No Presumption Between 100 and 999 Less than 20% Presumed No SISNOSE Between 100 and 999 20% or more Uncertain – No Presumption 1000 or more Any percent Uncertain – No Presumption **Greater than 3% for one or more affected small**  **entities** Fewer than 100 Less than 20% Presumed No SISNOSE Fewer than 100 20% or more Uncertain – No Presumption57 October 15, 2015

**Economic Impact Number of Small Entities**  **Subject to the Rule and Experiencing Given**  **Economic Impact Percent of All Small** 

**Enti ties Subject to the Rule**  **That A**  **re Experiencing Given Economic Impact**  **Certification Category**
Between 100 and 999 Less than 20% Uncertain – No Presumption Between 100 and 999 20% or more Presumed Ineligible for Certification 1000 or more Any percent Presumed Ineligible for Certification 

# 5.2. **Aggregate Small Business Impacts of Proposed Regulatory Changes**  As shown in Table 29 , an estimated 9 50, 5 00 small businesses may be subject to t he proposed regulatory actions . Appendix C shows small businesses potentially affected at the NAICS code level. **Table 29**  **. Summary of the Small Business Impact Industry**  **Estimated Number of Small Businesses Affected by the Rule**  Grocery and Specialty Food Stores 64,220 Warehouse Clubs and Supercenters 30 Agriculture and Crop Support Services 3,780 Utilities 580 Food manufacturing 38,230 Beverage and Ice Manufacturing 4,530 Non -food Manufacturing 58,120 General Merchandise Stores 2,960 Refrigerated Warehousing and Storage 580 Other Warehousing, Storage, and Transportation 3,680 Non - durable Goods Wholesalers and Dealers 43,140 Durable Goods Wholesalers and Dealers 105,770 Educational Services 1,420 Hospitals 90 Research and Development 820 Office Buildings 128,980 Arts, Entertainment, and Recreation 2,25058 October 15, 2015 **Industry Estimated Number of Small**  **Businesses Affected by the Rule** Reclaimers 50 Disposal Establishments 340 Service Establishments 2,180 Refrigerant Wholesalers 193,120 Service Technicians 295,590 Small Can Manufacturers 5 **Total 950,490**  Totals may not sum due to independent rounding. 

### To analyze the economic impacts on small businesses against the SISNOSE decision matrix, a “sales test” was applied, which calculates annualized compliance costs 33 

### as a percentage of annual sales for businesses in each NAICS code by size category. For industries for which annual sales data w ere not available through the Economic Census, annual receipts or annual value of shipments 34 

### was u sed as a proxy. Table 30 aggregates the estimated economic impacts on small businesses, according to the categories set out in the SISNOSE decision matrix and using a 7% discount rate . 35 

### Using the decision criteria established in Table 28, this screening analysis suggests that this rulemaking c an be presumed to have no SISNOSE for the fo llowing reasons:
 

### A bout 944,000 small businesses (99%) are estimated to incur compliance costs that will be less than 1% of annual sales.  

### A pproximately 1 5 0 of the approximately 9 50, 5 0 0 affected small businesses — or less than 0. 0 2 % — could incur costs in excess of 1% of annual sales and that fewer than 8 0 small businesses — or less than 0.01% — could incur co sts in excess of 3% of annual sales. These estimates are below the thresholds for a substantial number determination (i.e., between 100 and 999 entities and less than 20% of affected entities).

33 Total economic impact includes incremental compliance costs for leak repair and inspection, as well as compliance costs for reporting and recordkeeping and self
- sealing valves on small cans. Avoided compliance costs associated with ODS equipment retirements avoided and refrigerant savings were not included . 34 Total value of shipments includes the received or receivable net selling values of all products shipped (excluding freight an d taxes). 35 A sensitivity analysis showing the aggregated economic impacts on small entities using a 3% discount rate can be found in Appendix D.59 October 15, 2015 

### Table **30 . Aggregated Economic Impacts on Small Businesses**  **Economic Impact Industry**  **Number of Small Entities Subject to the Rule and**  **Experiencing Given Economic**

**Impact Percent of All Small** 

**Entities Subject to the Rule That are Experiencing**  **Given Economic Impact** Less than 1% for all affected small entities a Agriculture and Crop Support Services 3,780

Grocery & Specialty Food Stores 64,160 Warehouse Clubs & Supercenters 10 Utilities 560 Food Manufacturing 37,840 Beverage & Ice Manufacturing 4,530 Non -food Manufacturing 57,800 General Merchandise Stores <5 Refrigerated Warehousing and Storage 520 Other Warehousing, Storage, and Transportation 3,670 Non - durable Goods Wholesalers and Dealers 43,140 Durable Goods Wholesalers and Dealers 105,730 Educational Services 1,420 Hospitals 90 Research and Development 820 Office Buildings 128,510 Arts, Entertainment, and Recreation 2,250 Reclaimers 50 Refrigerant Wholesalers 193,120 Service Technicians 295,590 Small Can Manufacturers <5 **Total 943,610**  **99 %**  1% or more for one or more affected small entities b Agriculture and Crop Support Services <5

Grocery & Specialty Food Stores 40 Warehouse Clubs & Supercenters 20 Food Manufacturing 10 Beverage & Ice Manufacturing <5 Non -food Manufacturing 10 Other Warehousing, Stor, Trans. <560 October 15, 2015

**Economic Impact Industry**  **Number of Small Entities Subject to the Rule and**  **Experiencing Given Economic**

**Impact Percent of All Small** 

**Entities Subject to the Rule That are Experiencing**  **Given Economic Impact** Non - durable Goods Wholesalers <5 Durable Goods Wholesalers 30 Research and Development <5 Office Buildings 20 Small Can Manufacturers <5 **Total 1**  **5 0**  **0. 0**  **2 %**  Greater than 3% for one or more affected small entities Agriculture and Crop Support Services <5

Grocery & Specialty Food Stores 10 Warehouse Clubs & Supercenters 20 Food Manufacturing <5 Non -food Manufacturing <5 Other Warehousing, Stor, Trans. <5 Durable Goods Wholesalers 20 Office Buildings 20 **Total 8** **0 0.01%**  Totals may not sum due to independent rounding. a Represents small entities affected with an economic impact equal to or lesser than 1% but greater than 0%. b T his category aggregates the number of small entities that would be expected to experience an impact of 1% to 3% with the number of small entiti es that would be expected to experience an impact of 3% or greater. 

# 6. **Statutory and Executive Order Impact Analyses**  This section summarizes the screening analyses that were conducted to meet the relevant statutory and administrative requirements imposed by Congress and the Executive Office, including EOs 12866, 13132, 13045, and 12898 ; the RFA; and the UMRA . **EO 12866 : Regulatory Planning and Review** **.** The total annual economic impact of the proposed regulatory changes is expected to be approximately $63 million , which is below the $100 million threshold for a n economically “significant regulatory action.” **UMRA.** The proposed rulemaking is not expected to result in expenditure s 36 

### by State, local, and tribal governments, in the aggregate, or by the private s ector, of $100 million or more in any one year . The

36 Section 421(3)(D)(ii) of UMRA specifies that direct costs should not include “expenditures to the extent that such expe nditures will be offset by any direct savings to the State, local, and tribal governments or by the private sector as a resul t of— (I) compliance with the Federal mandate; or (II) other changes in Federal law or regulation that are enacted or adopted in the same bill or joint resolution or proposed or final Federal regulation and that govern the same activity as is affected by the Federal mandate.”61 October 15, 2015



### estimated aggregate expenditures associated with the proposed rulemaking are approximately $63 million . **RFA.** This screening analysis finds that the proposed rulemaking can be presumed to have no significa nt economic impact on a substantial number of small entities (SISNOSE) for the following reasons:
 

### A bout 944,000 small businesses (99%) are estimated to incur compliance costs that will be less than 1% of annual sales.  

### A pproximately 1 5 0 of the approximately 9 50, 5 0 0 affected small businesses — or less than 0. 0 2 % — could incur costs in excess of 1% of annual sales, and that fewer than 8 0 small businesses — or less than 0.01% — could incur co sts in excess of 3% of annual sales. These estimates are below the thresholds for a substantial number determination (i.e., between 100 and 999 entities, and less than 20% of affected entities). 

# 7. **Conclusions** This screening analysis found the total annual compliance cost s of EPA’s proposed regulatory changes to Section 608 to be appro ximately $ 63 million . These costs are below the $100 million adverse impact threshold set by EO 12866. Emission reduction benefits of the proposed rulemaking are approximately 7.5 MMTCO 2 

### eq (from both ODS and HFC refrigerants) , and 116 ODP -weighted MT . The RFA screening analysis found that the Agency’s proposed changes will impact an estimated 9 50,000 small businesses, with only 0. 0 1 % of the small businesses subject to the rulemaking experiencing net costs of 1% or more of annual sales.62 October 15, 2015



# 8. **References** ACEEE (American Council for an Energy
- Efficient Economy). 2013. Appliance Standards: Comparing Predicted and Observed Prices. Report Number E13D. Prepared by Steven Nadel and Andrew deLaski. Bureau of Labor Statistics (BLS). 2014 a . U.S. Depart ment of Labor, Occupational Employment and Wages, May 2014. 49 -9021 Heating, Air Conditioning, and Refrigeration Mechanics and Installers . Retrieved August 3, 2015, from http://www.bls.gov/oes/cu rrent/oes499021.htm
. Bureau of Labor Statistics (BLS). 2014 b . U.S. Department of Labor, Occupational Employment and Wages, May 2014. 43 - 5111 Weighers, Measurers, Checkers, and Samplers, Recordkeeping. Retrieved August 3, 2015, from http://www.bls.gov/oes/current/oes435111.htm
. CARB. 2009a. Initial Statement of Reasons for Proposed Regulation for the Management of High Global Warming Potential Refrigerants for Stationary Sources. Retrieved July 2 4, 2015, from http://www.arb.ca.gov/cc/rmp/RMP_ISOR&Appendices(WithE&F).pdf
. CARB . 2009 b . Appendix G. Technical Support Document: Staff Analysis on Emissions and Economic Impact of Proposed Regulation for Small Containers of Automotive Refrigerant. Retrieved June 3, 2015, from http://www.arb.ca.gov/regact/2009/hfc09/hfcappg.pdf
. CARB . 2010 a . Regulation for the Management of High Global Warming Potential Refrigerants for Stationary Sources. Final Regulation Order. Retrieved August 3 , 2015, from http://www.arb.ca.gov/regact/2009/hfc09/testpro.pdf
. CARB. 2010 b . Test Procedure for Leaks from Small Containers of Automotive Refrigerant . TP - 503 . Retrieved June 5, 2015, from http://www.arb.ca.gov/cc/rmp/rmprule.htm
. CARB . 2014. D ata reported to California Air Resources Board under the R efrigerant M anagement P rogram for the 2013 calendar year . Provided to EPA and ICF on May 16, 2014. CEP -Armines . 2008. Evaluation of the Potential Impact of Emissions of HFC
- 134a From Non Professional Servicing of Motor Vehicle Air Conditioning Systems. Prepared for State of California Air Resources Board under CARB Agreement No. 06 - 341 . Final Report. December 2008. Retrieved June 4, 2015, from http://www.arb.ca.gov/research/apr/past/06
- 341.pdf. Clodic et al. 2008. Evaluation of the Potential Impact of Emissions of HFC
- 134a from Nonprofessional Servicing of Motor Vehicle Air Conditioning Systems, ARB Research Contract Draft Fin al Report, July, 2008. http://www.arb.ca.gov/research/apr/past/06
- 341.pdf Cowan, D. et al. 2010. REAL Zero – Reducing refrigerant emissions & leakage – feedback from the IOR Project . The Institute of Refrigeration. Available online at: http://www.epa.gov/greenchill/downloads/IOR_ReducingRefrigerantEmissions.pdf
.63 October 15, 2015



### ICF International (ICF). 1997. Analysis of the Costs and Benefits of Leak Repair Requirements for the Commercial Refrigeration and Retail Food Sectors. Prepared for U.S. EPA, Office of Air and Radiation. Infogroup, Inc. (n.d.). ReferenceUSA Online Database . Retrieved May 27, 2015 , from http://www.referenceusa.com
. Intergovernmental Panel on Climate Change (IPCC). 2007. Climate Change 2007: The Physical Science Basis. Contribution of Working Group I to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change. Solomon, S., D. Qin, M. Manning, Z. Chen, M. Marquis, K.B. Averyt, M. Tignor, and H.L. Miller (Eds.). Cambridge University Press, Cambridge, United Kingdom and New York, NY, USA. September 2007. Available online at: http://www.ipcc.ch/publications_and_data/ar4/wg1/en/contents.html
. Intergovernmental Panel on Climate Change [IPCC] and Technology and Economic Assessment Panel [TEAP] (IPCC/TEAP ). 2005. Special Report on Safeguarding the Ozone Layer and the Global Climate Systems, 2005. Available online at: https://www.ipcc.ch/pdf/special
- reports/sroc/sroc_full. pdf Kim, Woohyn, and James E. Braun. 2010. Impacts of Refrigerant Charge on Air Conditioner and Heat Pump Performance. International Refrigeration and Air Conditioning Conference. Paper 1122. Retrieved July 28, 2015, from http://docs.lib.purdue.edu/iracc/1122
. NPD . 2008. NPD Automotive Aftermarket Industry Monitor
- Total U.S. Auto Parts Chain Retailers, Refrigerant Category – Topline Summary #2. Oak Ridge National Laboratory (ORNL). 2014. The Transportation Energy Data Book (TEDB). Produced by Oak Ridge National Laboratory for the U.S. Department of Energy’s Office of Energy Efficiency and Renewable Energy. Edition 33 Released July 31, 2014. Retrieved July 27, 2015, from http://cta.ornl.gov/data/index.shtml
. SBA . 2014. U. S. Small Business Administration Table of Small Business Size Standards Matched to North American Industry Classification System Codes . Retrieved June 3, 2015, from https://www.sba.gov/content/small
- business
- size -standards . Stanford University. 2011. Energy Efficiency and Climate Change Mitigation. EMF Report 25; Volume I. Stratus Consulting (Stratus). 2009. Screening Analysis to Examine the Economic Impact of Proposed Revisions to the Refrigerant Recycling and Emissions Rule. Tait Consulting Ltd, 2012. Impact Assessment for Condensing Units . Retrieved March 10, 2015, from http://www.taitconsulting.co.uk/Ecodesign_Consultation_files/Impact%20assesment%20report%2 0Condensing%20units%20V1_3.pdf.64 October 15, 2015



### U.S. C ensus Bureau. 2007. Economic Census. Retrieved February 25, 2015 from: http://www.census.gov/econ/susb/data/susb2007.html U.S. Census Bureau. 2012. 2012 County Business Patterns. Number of Firms, Number of Establishments, Employment, and Annual Payroll by Enterprise Employment Size for the United States, All Industries: 2012. Retrieved February 25, 2015 from: http://www.census.gov/econ/susb/ U.S. Census Bureau. 2015. North American Industry Classification System Frequently Asked Questions. Accessed June 3, 2015. Available online at: https://www.census.gov/eos/www/naics/faqs/faqs.html U.S. Department of Energy (DOE). 2009. Energy Savings Potential and R&D Opportunities for Commercial Refrigeration. Prepared by Navigant Consulting, Inc. U.S. Department of Energy (DOE). 2013. Life
- Cycle Cost Spreadsheet (NOPR). EERE
- 2013 - BT-STD -0007 - 0024. U.S. Environmental Protection Agency (EPA) . 1993. Regulatory Impact Analysis: The National Recycling Program and Emission Reduction Program (Section 608 of the Clean Air Act Amendments of 1990) . U.S. Environmental Protection Agency, Office of A ir and Radiation, Global Programs Division, Washington, DC. March, 1993. U.S. Environmental Protection Agency (EPA). 1999. The Benefits and Costs of the Clean Air Act 1990 to 2010. EPA Report to Congress. EPA-410 - R -99 -001. U.S. Environmental Protection Agency (EPA). 2011. Health and Welfare Benefits Analyses to Support the Second Section 812 Benefit
- Cost Analysis of the Clean Air Act. Prepared by Industrial Economics, Incorporated for U.S. Environmental Protection Agency, Office of Air and Radiation . Feb ruary 2011. Available online at: http://www.epa.gov/cleanairactbenefits/feb11/benefitsfullreport.pdf
. U.S. Environmental Protection Agency (EPA) . 2013. The Social Cost of Carbon. Available online at: http://www.epa.gov/climatechange/EPAactivities/economics/scc.html U.S. Environmental Protection Agency (EPA). 2014. EPA’s Vintaging Model. “VM IO file_v4.4_10.13.14.” U.S. Environmental Protection Agency (EPA) . 2015 a . Updating Ozone Calculations and Emissions Profiles for use in the Atmospheric and Health Effects Framework Model . U.S. Environmental Protection Agency, Office of Air and Radiation, Stratospheric Protection Division, Washington, DC. February, 2015. Available online at: http://www.epa.gov/ozone/science/effects/AHEF_2015_Update_Report
FINAL_508.pdf U.S. Environmental Protection Agency (EPA). 201 5b . National Refrigerant Recycling and Emissions Reduction Program , EPA ICR Number: 1626.1 3 , OMB Control Number: 2060
-0256 . Available online at: http://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=201501
- 2060 -008 .65 October 15, 2015



### U.S. Environmental Protection Agency (EPA) and National Highway Traffic Safety Administration (NHTSA). 2 012. Joint Technical Support Document: Final Rulemaking for 2017
- 2025 Light
- Duty Vehicle Greenhouse Gas Emission Standards and Corporate Average Fuel Economy Standards. August 2012. Available online at: http://www.epa.gov/otaq/climate/documents/420r12901.pdf
. United States Government. 2013. Technical Support Document
- Technical Update of the Social Cost of Carbon for Regulatory Impact Analysis – Under Executive Order 12866. Interagency Working Group on Social Cost of Carbon, United States Government. Updated November 2013. Available online at: https://www.whitehouse.gov/sites/default/files/omb/assets/inforeg/technical
- update
- social
-cost of
- carbon
-for
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- impact - analysis.pdf. Zhan, T. et al. 2014 . Inventory and M itigation O pportunities for HFC
- 134a E missions from N onprofessional A utomotive Service. Atmospheric Environment 99 (2014) 17
- 23.A- 1 October 15, 2015



# Sensitivity Analyses **for Aggregate Economic Analysis**  Appendix A.
**A.1. Aggregate Economic Analysis with**  **CARB ODS and HFC Equipment Distribution** The following tables show the impact on the results of using the CARB distribution for ODS versus HFC equipment rather than the Vintaging Model . **Table 31**  **: Annual**  **Compliance Costs and Total A nnual Refrigerant Savings (2014$)**  **with CARB ODS and HFC Equipment Distribution Rule Component**  **Annual Compliance Costs**  **Annual Refrigerant Savings HFC**  **ODS Total**  **HFC ODS**  **Total** Leak Inspection CC, CR, and IPR 50
-500 lbs. $17,409,000 $16,822,000 $34,231,000 **- -**  **-** CR and IPR ≥500 lbs. $21,777,000 $27,536,000 $49,314,000 **- -**  **-** Leak Repair CC $6,067,000
- $36,180,000
- $30,113,000
- $12,091,000
- $17,337,000
- $29,427,000 CR $1,683,000
- $11,946,000
- $10,262,000
- $3,081,000
- $8,806,000
- $11,887,000 IPR $379,000 $49,000 $428,000
- $1,963,000
- $2,586,000
- $4,549,000 Reporting & Recordkeeping $11,320,000 $5,772,000 $17,092,000 **- -**  **-** Self
- sealing Valves on Small Cans $3,070,000
- $3,070,000 **- -**  **- Total**  **$61,705,000 $2,053,000**  **$63,760,000 -**  **$17,135,000 -**  **$28,729,000 -**  **$45,863,000**A- 2 October 15, 2015 

### Table **32 : . Annual GHG and ODS Emissions Avoided**  **with CARB ODS and HFC Equipment Distribution**

**Rule Component GHG Emissions Avoided**  **(MTCO 2** **eq) ODS Emissions Avoided**  **(ODP -** **weighted MT) HFC**  **ODS Total**  **ODS** Leak Inspection and Repair CC 1,742,000 2,134,000 3,876,000 67 CR 1,030,000 1,238,000 2,269,000 36 IPR 306,000 276,000 582,000 9 Reporting & Recordkeeping **- -**  **- -**  Self
- s ealing Valves on Small Cans 657,000 **-** 657,000 **- Total**  **3,735,000 3,648,000**  **7,384,000 112** A- 3 October 15, 2015



# A.2. **Aggregate Economic Analysis with 200 -**  **pound Annual Leak Inspection Threshold**  The following table show the impact on results associated with a 200
- pound threshold for annual leak inspection of CR and IPR, rather than 500 pounds (i.e., CR and IPR equipment containing less than 200 pounds receive annual leak inspections and CR and IPR equipment containi ng 200 or more pounds of refrigerant receive quarterly leak inspections). This sensitivity analysis did not affect the estimated annual GHG and ODS emissions avoided. **Table 33**  **: Annual**  **Compliance Costs and Total Annual Refrigerant Savings (2014$) with 200** **- pound Annual Leak Inspection**  **Threshold**

**Rule Component Annual**  **Compliance Costs Annual Refrigerant Savings**  **HFC ODS**  **Total HFC**  **ODS Total**  Leak Inspection CC, CR, and IPR 50
-2 00 lbs. $14,073,000 $13,578,000 $27,651,000
- - - CR and IPR ≥2 00 lbs. $35,123,000 $40,512,000 $75,636,000
- - - Leak Repair CC $5,046,000
- $38,191,000
- $33,145,000
- $15,977,000
- $20,221,000
- $36,198,000 CR $1,709,000
- $10,137,000
- $8,428,000
- $4,130,000
- $7,514,000
- $11,644,000 IPR $494,000 $39,000 $533,000
- $2,074,000
- $2,240,000
- $4,314,000 Reporting & Recordkeeping $12,055,000 $6,032,000 $18,087,000 **- -**  **-** Self
- sealing Valves on Small Cans $3,070,000
- $3,070,000 **- -**  **- Total**  **$71,570,000 $11,833,000**  **$83,404,000 -**  **$22,181,000 -**  **$29,975,000 -**  **$52,156,000** 

# A.3. **Aggregate Economic Analysis with Higher Post** **- Repair**  **Leak Rate** The following tables show the impact on results associated with higher post
- repair leak rate s set at 90% of the threshold leak rate (i.e., if the threshold rate is 20%, it is assumed that the system is repaired and has a resulting leak rate of 18%) , rather than the rates in Table 14 .A-4 October 15, 2015 

### Table **34 :**  **Annual Compliance Costs and Total Annual Refrigerant Savings (2014$)**  **with Higher Post** **- Repair**  **Leak Rate Rule Component**  **Annual Compliance Costs**  **Annual Refrigerant Savings HFC**  **ODS Total**  **HFC ODS**  **Total** Leak Inspection CC, CR, and IPR 50
-500 lbs. $17,409,000 $16,822,000 $34,231,000 **- -**  **-** CR and IPR ≥500 lbs. $21,777,000 $27,536,000 $49,314,000 **- -**  **-** Leak Repair CC $5,046,000
- $38,191,000
- $33,145,000
- $8,374,000
- $10,573,000
- $18,947,000 CR $1,709,000
- $10,137,000
- $8,428,000
- $2,942,000
- $4,766,000
- $7,708,000 IPR $494,000 $39,000 $533,000
- $1,867,000
- $2,016,000
- $3,883,000 Reporting & Recordkeeping $11,304,000 $5,789,000 $17,093,000 **- -**  **-** Self
- sealing Valves on Small Cans $3,070,000
- $3,070,000 **- -**  **- Total**  **$60,809,000 $1,858,000**  **$62,668,000 -**  **$13,183,000 -**  **$17,355,000 -**  **$30,538,000**



### Table **35 :**  **. Annual GHG and ODS Emissions Avoided with Higher**  **Post -**  **Repair Leak Rate**  **Rule Component GHG Emissions Avoided**  **(MTCO 2** **eq) ODS Emissions Avoided**  **(ODP -** **weighted MT) HFC**  **ODS Total**  **ODS** Leak Inspection and Repair CC 1,212,000 2,112,000 3,324,000 66 CR 842,000 859,000 1,701,000 2 4 IPR 310,000 203,000 513,000 7 Reporting & Recordkeeping **- -**  **- -**  Self
- s ealing Valves on Small Cans 657,000 **-** 657,000 **- Total**  **3,021,000 3,174,000**  **6,195,000 97** A- 5 October 15, 2015



# A.4. **Aggregate Economic Analysis with 3 %**  **Discount Rate** The following table show the impact on results associated with a 3% discount rate , rather than a 7% discount rate . This sensitivity analysis did not affect the estimated annual GHG and ODS emissions avoided.

**Table 36**  **: Annual**  **Compliance Costs and Total Annual Refrigerant Savings (2014$) with 3**  **% Discount Rate**  **Rule Component Annual**  **Compliance Costs Annual Refrigerant Savings**  **HFC ODS**  **Total HFC**  **ODS Total**  Leak Inspection CC, CR, and IPR 50
-500 lbs. $17,409,000 $16,822,000 $34,231,000 **- -**  **-** CR and IPR ≥500 lbs. $21,777,000 $27,536,000 $49,314,000 **- -**  **-** Leak Repair CC $2,437,000
- $18,705,000
- $16,268,000
- $15,977,000
- $20,221,000
- $36,198,000 CR $823,000
- $4,963,000
- $4,139,000
- $4,130,000
- $7,514,000
- $11,644,000 IPR $239,000 $17,000 $255,000
- $2,074,000
- $2,240,000
- $4,314,000 Reporting & Recordkeeping $11,304,000 $5,789,000 $17,093,000 **- -**  **-** Self
- sealing Valves on Small Cans $3,070,000
- $3,070,000 **- -**  **- Total**  **$57,059,000 $26,496,000**  **$83,556,000 -**  **$22,181,000 -**  **$29,975,000 -**  **$52,156,000**A- 6 October 15, 2015



# A.5. **Aggregate Economic Analysis with 2** **- week Leak Repair Improvement**  The following tables show the impact on results associated with the assumption that leaks are detected and repaired two weeks faster as a result of the proposed rulemaking, rather than three weeks .

**Table 37**  **: Annual**  **Compliance Costs and Total Annual Refrigerant Savings (2014$) with 2**  **- week Leak Repair Improvement** 

**Rule Component Annual**  **Compliance Costs Annual Refrigerant Savings**  **HFC ODS**  **Total HFC**  **ODS Total**  Leak Inspection CC, CR, and IPR 50
-500 lbs. $17,409,000 $16,822,000 $34,231,000 **- -**  **-** CR and IPR ≥500 lbs. $21,777,000 $27,536,000 $49,314,000 **- -**  **-** Leak Repair CC $4,886,000
- $38,444,000
- $33,558,000
- $10,651,000
- $13,481,000
- $24,132,000 CR $1,645,000
- $10,192,000
- $8,547,000
- $2,754,000
- $5,009,000
- $7,763,000 IPR $479,000 $26,000 $505,000
- $1,383,000
- $1,493,000
- $2,876,000 Reporting & Recordkeeping $11,304,000 $5,789,000 $17,093,000 **- -**  **-** Self
- sealing Valves on Small Cans $3,070,000
- $3,070,000 **- -**  **- Total**  **$60,570,000 $1,537,000**  **$62,108,000 -**  **$14,788,000 -**  **$19,983,000 -**  **$34,771,000**A- 7 October 15, 2015 

### Table **38 : . Annual GHG and ODS Emissions Avoided**  **with 2 -** **week Leak Repair Improvement Rule Component**  **GHG Emissions Avoided (MTCO**  **2 eq)**  **ODS Emissions Avoided**  **(ODP -** **weighted MT) HFC**  **ODS Total**  **ODS** Leak Inspection and Repair CC 950,000 1,658,000 2,608,000 52 CR 831,000 718,000 1,549,000 20 IPR 254,000 166,000 420,000 5 Reporting & Recordkeeping **- -**  **- -**  Self
- s ealing Valves on Small Cans 657,000 **-** 657,000 **- Total**  **2,692,000 2,542,000**  **5,234,000 78** A- 8 October 15, 2015



# A.6. **Aggregate Economic Analysis with 2 -**  **month Leak Repair Improvement** The following tables show the impact on results associated with the assumption that leaks are detected and repaired two months faster as a result of the proposed rulemaking, rather than three weeks .

**Table 39**  **: Annual**  **Compliance Costs and Total Annual Refrigerant Savings (2014$) with 2**  **- month Leak Repair Improvement** 

**Rule Component**  **Annual Compliance Costs**  **Annual Refrigerant Savings HFC**  **ODS Total**  **HFC ODS**  **Total** Leak Inspection CC, CR, and IPR 50
-500 lbs. $17,409,000 $16,822,000 $34,231,000 **- -**  **-** CR and IPR ≥500 lbs. $21,777,000 $27,536,000 $49,314,000 **- -**  **-** Leak Repair CC $6,552,000
- $36,924,000
- $30,371,000
- $42,605,000
- $53,922,000
- $96,527,000 CR $2,262,000
- $9,864,000
- $7,602,000
- $11,014,000
- $20,037,000
- $31,051,000 IPR $636,000 $105,000 $741,000
- $5,531,000
- $5,972,000
- $11,503,000 Reporting & Recordkeeping $11,304,000 $5,789,000 $17,093,000 **- -**  **-** Self
- sealing Valves on Small Cans $3,070,000
- $3,070,000 **- -**  **- Total**  **$63,010,000 $3,464,000**  **$66,476,000 -**  **$59,150,000 -**  **$79,931,000 -**  **$139,081,000**A- 9 October 15, 2015 

### Table **40 : . Annual GHG and**  **ODS Emissions Avoided with 2**  **- month Leak Repair Improvement**  **Rule Component GHG Emissions Avoided**  **(MTCO 2** **eq) ODS Emissions Avoided**  **(ODP -** **weighted MT) HFC**  **ODS Total**  **ODS** Leak Inspection and Repair CC 3,799,000 6,633,000 10,432,000 209 CR 3,323,000 2,872,000 6,195,000 80 IPR 1,015,000 666,000 1,681,000 21 Reporting & Recordkeeping **- -**  **-** Self
- s ealing Valves on Small Cans 657,000 **-** 657,000 **Total 8,794,000**  **10,171,000 18,965,000**  **311**A- 10 October 15, 2015



# A.7. **Aggregate Economic Analysis with Lower Threshold Leak Rates**  The following tables show the impact on results associated with lower threshold leak rates of 5% for CC and 15% for CR and IPR, rather than 10% and 20% respectively .

**Table 41**  **: Annual**  **Compliance Costs and Total Annual Refrigerant Savings (2014$)**  **with Lower Threshold Leak Rates Rule Component**  **Annual Compliance Costs**  **Annual Refrigerant Savings HFC**  **ODS Total**  **HFC ODS**  **Total** Leak Inspection CC, CR, and IPR 50
-500 lbs. $17,409,000 $16,822,000 $34,231,000 **- -**  **-** CR and IPR ≥500 lbs. $21,777,000 $27,536,000 $49,314,000 **- -**  **-** Leak Repair CC $5,463,000
- $38,130,000
- $32,666,000
- $10,475,000
- $21,581,000
- $32,055,000 CR $2,007,000
- $10,109,000
- $8,102,000
- $3,568,000
- $7,587,000
- $11,155,000 IPR $548,000 $43,000 $591,000
- $2,465,000
- $2,410,000
- $4,875,000 Reporting & Recordkeeping $11,316,000 $5,805,000 $17,120,000 **- -**  **-** Self
- sealing Valves on Small Cans $3,070,000
- $3,070,000 **- -**  **- Total**  **$61,590,000 $1,967,000**  **$63,558,000 -**  **$16,508,000 -**  **$31,578,000 -**  **$48,085,000**A- 11 October 15, 2015 

### Table **42 :**  **Annual GHG and ODS Emissions Avoided with Lower Threshold Leak Rates**  **Rule Component GHG Emissions Avoided**  **(MTCO 2** **eq) ODS Emissions Avoided**  **(ODP -** **weighted MT) HFC**  **ODS Total**  **ODS** Leak Inspection and Repair CC 1,509,000 2,648,000 4,157,000 83 CR 1,332,000 1,091,000 2,423,000 30 IPR 404,000 270,000 674,000 9 Reporting & Recordkeeping **- -**  **- -**  Self
- s ealing Valves on Small Cans 657,000 **-** 657,000 - **Total 3,902,000**  **4,009,000 7,911,000**  **122**A- 12 October 15, 2015



# A.8. **Aggregate Economic Analysis with Highe r**  **Threshold Leak Rates** The following tables show the impact on results associated with threshold leak rates of 15% for CC, 25% for CC, and 30% for IPR, rather than 10% for CC, and 20% for CC and IPR .

**Table 43**  **: Annual**  **Compliance Costs and Total Annual Refrigerant Savings (2014$) with Highe**  **r Threshold Leak Rates**  **Rule Component Annual**  **Compliance Costs Annual Refrigerant Savings**  **HFC ODS**  **Total HFC**  **ODS Total**  Leak Inspection CC, CR, and IPR 50
-500 lbs. $17,409,000 $16,822,000 $34,231,000 **- -**  **-** CR and IPR ≥500 lbs. $21,777,000 $27,536,000 $49,314,000 **- -**  **-** Leak Repair CC $4,030,000
- $38,333,000
- $34,303,000
- $7,349,000
- $14,092,000
- $21,440,000 CR $1,419,000
- $10,164,000
- $8,745,000
- $3,415,000
- $7,417,000
- $10,833,000 IPR $359,000 $29,000 $389,000
- $1,915,000
- $1,870,000
- $3,786,000 Reporting & Recordkeeping $11,283,000 $5,761,000 $17,044,000 **- -**  **-** Self
- sealing Valves on Small Cans $3,070,000
- $3,070,000 **- -**  **- Total**  **$59,347,000 $1,651,000**  **$61,000,000 -**  **$12,679,000 -**  **$23,379,000 -**  **$36,059,000**A- 13 October 15, 2015 

### Table **44 : Annual GHG and ODS Emissions Avoided**  **with Highe r**  **Threshold Leak Rates Rule Component**  **GHG Emissions Avoided (MTCO**  **2 eq)**  **ODS Emissions Avoided (ODP**  **- weighted MT)**  **HFC ODS**  **Total ODS**  Leak Inspection and Repair CC 1,136,000 1,833,000 2,970,000 57 CR 1,513,000 1,064,000 2,578,000 3 0 IPR 688,000 461,000 1,149,000 15 Reporting & Recordkeeping - - - Self
- s ealing Valves on Small Cans 657,000 **-** 657,000 **Total 3,994,000**  **3,358,000 7,354,000**  **101**B - 1 October 15, 2015



# Detailed Tables for Recordkeeping and Reporting Appendix B.

**Table 45**  **. Annual Compliance Costs for Recordkeeping and Reporting**  **Recordkeeping & Reporting Rule**  **Component Annual**  **Direct Compliance Costs Avoided**  **Compliance Costs**  **Total**

**Compliance Costs**  **HFC ODS**  **Total ODS**  Reclaimer recordkeeping & reporting $27,000
- $27,000
- $27,000 Refrigerant wholesalers recordkeeping $6,498,000
- $6,498,000
- $6,498,000 Owners/operators of appliances w/charge sizes >50 lbs. maintain information on purged/destroyed refrigerant <$100
- <$100
- <$100 Develop/maintain plan to retire/replace or retrofit equipment - - - - $813,000
- $813,000 Owners/operators of appliances w/charge sizes >50 lbs. prepare & submit requests for extensions $49,000 $55,000 $104,000
- $104,000 Recordkeeping associated with leak inspection and repair $4, 30 1 ,000 $1, 6 16,000 $5, 9 17,000 - $5, 9 17,000 New recordkeeping requirement for 5
- 50 lb. appliances $430,000 $5,049,000 $5,479,000
- $5,479,000 New recordkeeping requirement for small can manufacturers <$100
- <$100
- <$100 Removal of requirement for certification for acquisition of recovery/recycling equipment - - - - $118,000
- $118,000
**Total $11,**  **30 4** **,000 $6,**  **72 0** **,000 $18,**  **0 25** **,000 -**  **$931,000 $17,**  **093 ,000**  Totals may not sum due to independent rounding.C- 1 October 15, 2015



# Detailed Tables for SISNOSE Analysis Appendix C.

**Table 46**  **: Estimated Number of**  **Small Businesses Affected**  **by NAICS Code**

**Industry NAICS Code and Definition**  **Estimated Number of Small Businesses**  **Affected by the Rule** Agriculture and Crop Support Services 115112 Soil Preparation, Planting, and Cultivating 2,491

115113 Crop Harvesting, Primarily by Machine 383 115114 Postharvest Crop Activities (except Cotton Ginning) 908

Utilities 221111 Hydroelectric Power Generation 5

221112 Fossil fuel electric power generation 15 221113 Nuclear Electric Power Generation 2 221114 Solar Electric Power Generation 3 221115 Wind Electric Power Generation 3 221116 Geothermal Electric Power Generation 0 221117 Biomass Electric Power Generation 2 221118 Other Electric Power Generation 5 221121 Electric Bulk Power Transmission and Control 2 221122 Electric P ower D istribution 79 221210 Natural G as D istribution 18 221310 Water S upply and I rrigation Systems 153 221320 Sewage T reatment F acilities 15 221330 Steam and A ir- conditioning S upply 2 211111 Crude P etroleum and N atural G as E xtraction 280

Food Manufacturing 311111 Dog and Cat Food Manufacturing 379

311119 Other Animal Food Manufacturing 1,501 311211 Flour Milling 272 311212 Rice Milling 74 311213 Malt Manufacturing 32 311221 Wet Corn Milling 60 311224 Soybean and Other Oilseed Processing 161 311225 Fats and Oils Refining and Blending 167 311230 Breakfast Cereal Manufacturing 70 311313 Beet Sugar Manufacturing 29 311314 Cane Sugar Manufacturing 65C- 2 October 15, 2015

**Industry NAICS Code and Definition**  **Estimated Number of Small Businesses**  **Affected by the Rule**

311340 Non - chocolate Confectionery Manufacturing 725 311351 Chocolate and Confectionery Manufacturing from

Cacao Beans 266 311352 Confectionery Manufacturing from Purchased

Chocolate 1,961 311411 Frozen Fruit, Juice , and Vegetable Manufacturing 227 311412 Frozen Specialty Food Manufacturing 620 311421 Fruit and Vegetable Canning 953 311422 Specialty Canning 191 311423 Dried and Dehydrated Food Manufacturing 263 311511 Fluid Milk Manufacturing 359 311512 Creamery Butter Manufacturing 41 311513 Cheese Manufacturing 650 311514 Dry, Condensed, and Evaporated Dairy Product

Manufacturing 187 311520 Ice Cream and Frozen Dessert Manufacturing 581 311611 Animal (except Poultry) Slaughtering 2,467 311612 Meat Processed from Carcasses 2,052 311613 Rendering and Meat Byproduct Processing 183 311615 Poultry Processing 441 311710 Seafood Product Preparation and Packaging 854 311811 Retail Bakeries 11,455 311812 Commercial Bakeries 4,014 311813 Frozen Cakes, Pies, and Other Pastries Manufacturing 325 311821 Cookie and Cracker Manufacturing 516 311824 Dry Pasta, Dough, and Flour Mixes Manufacturing from

Purchased Flour 616 311830 Tortilla Manufacturing 583 311911 Roasted Nuts and Peanut Butter Manufacturing 342 311919 Other Snack Food Manufacturing 506 311920 Coffee and Tea Manufacturing 710 311930 Flavoring Syrup and Concentrate Manufacturing 223 311941 Mayonnaise, Dressing, and Other Prepared Sauce

Manufacturing 507C- 3 October 15, 2015

**Industry NAICS Code and Definition**  **Estimated Number of Small Businesses**  **Affected by the Rule**
311942 Spice and Extract Manufacturing 566 311991 Perishable Prepared Food Manufacturing 1,075 311999 All Other Miscellaneous Food Manufacturing 955 Beverage and Ice Manufacturing 312111 Soft D rink M anufacturing 230

312112 Bottled W ater M anufacturing 234 312113 Ice M anufacturing 341 312120 Breweries 931 312130 Wineries 2,796

Non -food Manufacturing 322121 Paper (except N ewsprint) M ills 151

322211 Corrugated and S olid F iber B ox M anufacturing 887 322220 Paper Bag and Coated and Treated Paper

Manufacturing 789 323111 Commercial Printing (except Screen and Books) 22,310 324110 Petroleum R efineries 87 325120 Industrial G as M anufacturing 141 325180 Other Basic Inorganic Chemical Manufacturing 476 325211 Plastics M aterial and R esin M anufacturing 1,045 325320 Pesticide and Other Agricultural C hemical

M anufacturing 174 325412 Pharmaceutical preparation manufacturing 1,076 325413 In -vitro diagnostic substance manufacturing 185 325414 Biological product (except diagnostic) manufacturing 209 325620 Toilet preparation manufacturing 901 325991 Custom compounding of purchased resins 390 325998 All other miscellaneous chemical product and

preparation manufacturing 1,025 326122 Plastics pipe and pipe fitting manufacturing 311 326140 Polystyrene foam product manufacturing 316 326160 Plastics bottle manufacturing 185 326199 All other plastics product manufacturing 6,298 326211 Tire manufacturing (except retreading) 93 332431 Metal can manufacturing 80 332812 Metal coating, engraving (except jewelry and

silverware), and allied services to manufacturers 2,558 332813 Electroplating, plating, polishing, anodizing, and

coloring 2,580C-4 October 15, 2015

**Industry NAICS Code and Definition**  **Estimated Number of Small Businesses**  **Affected by the Rule**
333241 Food Product Machinery Manufacturing 451 333242 Semiconductor Machinery Manufacturing 165 333415 Air- conditioning and warm air heating equipment and

commercial and industrial refrigeration equipment manufacturing 839
333611 Turbine and turbine generator set units manufacturing 227 334112 Computer storage device manufacturing 119 334419 Other Electronic Component Manufacturing 2,640 334413 Semiconductor and related device manufacturing 808 334510 Electromedical and electrotherapeutic apparatus

manufacturing 689 334515 Instrument manufacturing for measuring and testing

electricity and electrical systems 856 334516 Analytical laboratory instrument manufacturing 651 334613 Blank magnetic and optical recording media

manufacturing 87 336411 Aircraft manufacturing 262 336415 Guided missile and space vehicle propulsion unit and

propulsion unit parts manufacturing 21 339112 Surgical and medical instrument manufacturing 1,236 339999 All other miscellaneous manufacturing 6,804 Grocery and Specialty Food Stores 445110 Supermarkets and other grocery (except convenience) stores 47,513 445210 Meat markets 5,466 445230 Fruit and vegetable markets 3,027 445299 All other specialty food stores 4,624 722310 Food service contractors 3,593 Warehouse Clubs and Supercenters 452910 Wareho us e clubs and supercenters 31
General Merchandise Stores 452112 Discount department stores 5

452990 All other ge neral merchandise stores 1,166 453998 All other miscellaneous store retailers (except tobacco

stores) 1,785 Refrigerated Warehousing and Storage 493120 Refrigerated warehousing and storage 577
Other Warehousing, 484220 Specialized freight (except used goods) trucking, local 2,086C- 5 October 15, 2015

**Industry NAICS Code and Definition**  **Estimated Number of Small Businesses**  **Affected by the Rule** Storage, and Transportation 488119 Other airport operations 84

488510 Freight transportation arrangement 1,060 488991 Packing and crating 88 493110 General warehousing and storage 276 493130 Farm product warehousing and storage 20 493190 Other warehousing and storage 63

Non - durable Goods Wholesalers and Dealers 424210 Drugs and druggists' sundries merchant wholesalers 7,084

424410 General line grocery merchant wholesalers 2,414 424420 Packaged frozen food merchant wholesalers 3,031 424430 Dairy product (except dried or canned) merchant

wholesalers 1,770 424440 Poultry and poultry product merchant wholesalers 481 424460 Fish and seafood merchant wholesalers 2,076 424470 Meat and meat product merchant wholesalers 2,337 424480 Fresh fruit and vegetable merchant wholesalers 4,772 424490 Other grocery and related products merchant

wholesalers 10,673 424590 Other farm product raw material merchant

wholesalers 653 424710 Petroleum bulk stations and terminals 2,994 424810 Beer and ale merchant wholesalers 1,399 424930 Flower, nursery stock, and florists' supplies merchant

wholesalers 3,461

Durable Goods Wholesalers and Dealers 423410 Photographic equipment and supplies merchant wholesalers 811 423740 Refrigeration equipment and supplies merchant

wholesalers 727 423990 Other miscellaneous durable goods merchant

wholesalers 9,338 441110 New Car Dealers 19,183 441120 Used Car Dealers 27,127 441210 Recreational Vehicle Dealers 2,777 441222 Boat Dealers 4,973 441228 Motorcycle, ATV, and All Other Motor Vehicle Dealers 6,012 441310 Automotive Parts and Accessories Stores 23,056 441320 Tire Dealers 11,766C- 6 October 15, 2015

**Industry NAICS Code and Definition**  **Estimated Number of Small Businesses**  **Affected by the Rule**

Educational Services 611110 Elementary and second schools 1,281

611210 Junior Colleges 27 611310 College, universities, and professional schools 111 Hospitals 622110 General medical and surgical hospitals 92 Research and Development 54171 Research and development in the Physical, Engineering and Life Sciences 824

Office Buildings 511110 Newspaper Publishers 307

511120 Periodical Publishers 321 511130 Book Publishers 149 511140 Directory and Mailing List Publishers 48 511191 Greeting Card Publishers 6 511199 All Other Publishers 45 511210 Software Publishers 380 512110 Motion Picture and Video Production 834 512120 Motion Picture and Video Distribution 26 512131 Motion Picture Theaters (except Drive
- Ins) 135 512132 Drive - In Motion Picture Theaters 17 512191 Teleproduction and Other Postproduction Services 132 512199 Other Motion Picture and Video Industries 21 512210 Record Production 25 512220 Integrated Record Production/Distribution 22 512230 Music Publishers 47 512240 Sound Recording Studios 113 512290 Other Sound Recording Industries 26 515111 Radio Networks 38 515112 Radio Stations 212 515120 Television Broadcasting 61 515210 Cable and Other Subscription Programming 23 517110 Wired Telecommunications Carriers 471 517210 Wireless Telecommunications Carriers (except

Satellite) 144 517410 Satellite Telecommunications 35 51791 Other Telecommunications 256 518210 Data Processing, Hosting, and Related Services 485 519120 Libraries and Archives 143C- 7 October 15, 2015

**Industry NAICS Code and Definition**  **Estimated Number of Small Businesses**  **Affected by the Rule**
522220 Sales Financing 153 522291 Consumer Lending 325 522292 Real Estate Credit 691 522293 International Trade Financing 16 522294 Secondary Market Financing 13 522298 All Other Nondepository Credit Intermediation 345 522310 Mortgage and Nonmortgage Loan Brokers 1,342 522320 Financial Transactions Processing, Reserve, and

Clearinghouse Activities 146 522390 Other Activities Related to Credit Intermediation 362 524113 Direct Life Insurance Carriers 58 524114 Direct Health and Medical Insurance Carriers 47 524126 Direct Property and Casualty Insurance Carriers 242 524127 Direct Title Insurance Carriers 155 524128 Other Direct Insurance (except Life, Health and

Medical) Carriers 29 524130 Reinsurance Carriers 13 524210 Insurance Agencies and Brokerages 7,967 524291 Claims Adjusting 238 524292 Third Party Administration of Insurance and Pension

Funds 216 524298 All Other Insurance Related Activities 148 531110 Lessors of Residential Buildings and Dwellings 3,295 531120 Lessors of Nonresidential Buildings (except

Miniwarehouses) 1,820 531130 Lessors of Miniwarehouses and Self Storage Units 628 531190 Lessors of Other Real Estate Property 571 531210 Offices of Real Estate Agents and Brokers 6,564 531311 Residential Property Managers 1,814 531312 Nonresidential Property Managers 874 531320 Offices of Real Estate Appraisers 1,059 531390 Other Activities Related to Real Estate 1,055 541110 Offices of Lawyers 11,062 541191 Title Abstract and Settlement Offices 655 541199 All Other Legal Services 182C- 8 October 15, 2015

**Industry NAICS Code and Definition**  **Estimated Number of Small Businesses**  **Affected by the Rule**
541211 Offices of Certified Public Accountants 3,560 541213 Tax Preparation Services 1,019 541214 Payroll Services 252 541219 Other Accounting Services 2,295 541310 Architectural Services 1,546 541320 Landscape Architectural Services 420 541330 Engineering Services 2,968 541340 Drafting Services 202 541350 Building Inspection Services 377 541360 Geophysical Surveying and Mapping Services 64 541370 Surveying and Mapping (except Geophysical) Services 611 541380 Testing Laboratories 317 541410 Interior Design Services 893 541420 Industrial Design Services 121 541430 Graphic Design Services 1,095 541490 Other Specialized Design Services 136 541511 Custom Computer Programming Services 3,204 541512 Computer Systems Design Services 2,750 541513 Computer Facilities Management Services 204 541519 Other Computer Related Services 662 541611 Administrative Management and General

Management Consulting Services 3,821 541612 Human Resources Consulting Services 882 541613 Marketing Consulting Services 1,628 541614 Process, Physical Distribution and Logistics Consulting

Services 405 541618 Other Management Consulting Services 434 541620 Environmental Consulting Services 537 541690 Other Scientific and Technical Consulting Services 1,615 54171 Research and Development in the Physical,

Engineering, and Life Sciences 775 541720 Research and Development in the Social Sciences and

Humanities 149 541810 Advertising Agencies 852 541820 Public Relations Agencies 473 541830 Media Buying Agencies 52C- 9 October 15, 2015

**Industry NAICS Code and Definition**  **Estimated Number of Small Businesses**  **Affected by the Rule**
541840 Media Representatives 125 541850 Outdoor Advertising 136 541860 Direct Mail Advertising 188 541870 Advertising Material Distribution Services 48 541890 Other Services Related to Advertising 513 541910 Marketing Research and Public Opinion Polling 297 541921 Photography Studios, Portrait 635 541922 Commercial Photography 266 541930 Translation and Interpretation Services 125 541940 Veterinary Services 1,747 541990 All Other Professional, Scientific and Technical Services 1,166 551111 Offices of Bank Holding Companies 38 551112 Offices of Other Holding Companies 328 561110 Office Administrative Services 1,638 561210 Facilities Support Services 100 56131 Employment Placement Agencies 511 561320 Temporary Help Services 800 561330 Professional Employer Organizations 278 561410 Document Preparation Services 319 561421 Telephone Answering Services 102 561422 Telemarketing Bureaus and Other contact Centers 138 561431 Private Mail Centers 356 561439 Other Business Service Centers (including Copy Shops) 198 561440 Collection Agencies 279 561450 Credit Bureaus 40 561491 Repossession Services 58 561492 Court Reporting and Stenotype Services 215 561499 All Other Business Support Services 212 561510 Travel Agencies 781 561520 Tour Operators 194 561591 Convention and Visitors Bureaus 66 561599 All Other Travel Arrangement and Reservation Services 107 561611 Investigation Services 312 561612 Security Guards and Patrol Services 367C- 10 October 15, 2015

**Industry NAICS Code and Definition**  **Estimated Number of Small Businesses**  **Affected by the Rule**
561613 Armored Car Services 9 561621 Security Systems Services (except Locksmiths) 353 561622 Locksmiths 250 561710 Exterminating and Pest Control Services 700 561720 Janitorial Services 3,307 561730 Landscaping Services 5,994 561740 Carpet and Upholstery Cleaning Services 572 561790 Other Services to Buildings and Dwellings 781 561910 Packaging and Labeling Services 117 561920 Convention and Trade Show Organizers 262 561990 All Other Support Services 829 712110 Museums 309 712130 Zoos and Botanical Gardens 37 721110 Hotels (except Casino Hotels) and Motels 2,598 721120 Casino Hotels 8 813110 Religious Organizations 11,736 813211 Grantmaking Foundations 552 813212 Voluntary Health Organizations 167 813219 Other Grantmaking and Giving Services 192 813311 Human Rights Organizations 155 813312 Environment, Conservation and Wildlife Organizations 322 813319 Other Social Advocacy Organizations 372 813410 Civic and Social Organizations 1,796 813910 Business Associations 1,054 813920 Professional Organizations 405 813930 Labor Unions and Similar Labor Organizations 969 813940 Political Organizations 150 813990 Other Similar Organizations (except Business,

Professional, Labor, and Political Organizations) 1,389 92 Public Administration - Arts, Entertainment, and Recreation 711310 Promoters of performing arts, sports, and similar events with facilities 205 713940 Fitness and recreational sports centers 2,046 Reclaimers 325120 Industrial Gas Manufacturing 1

423930 Recyclable Material Merchant Wholesalers 26C- 11 October 15, 2015

**Industry NAICS Code and Definition**  **Estimated Number of Small Businesses**  **Affected by the Rule**
562920 Materials Recovery Facilities 3 562212 Solid Waste Landfill 2 424690 Other Chemical and Allied Products Merchant

Wholesalers 22 Disposal Establishments 562920 Materials Recovery Facilities 32

562212 Solid Waste Landfill 24 423990 Other Miscellaneous Durable Goods Merchant

Wholesalers 289 Service Establishments 811310 Commercial Industrial Machinery and Equipment (not Automotive and Electronic) Repair and Maintenance 1,800 811412 Appliance Repair and Maintenance 376 Refrigerant Wholesalers 325120 Industrial Gas Manufacturing 52

424690 Other Chemical and Allied Products Merchant

Wholesalers 3,700 42 Wholesale Trade 189,364 Service Technicians 238220 Plumbing, heating, and air
- conditioning contractors 295,592 Small Can Manufacturers 441310 Automotive Parts and Accessories Stores 2

325120 Industrial Gas Manufacturing 3 **Total 950,486** 

# Sensitivity Analysis for SBREFA

Appendix D.
**D.1. Aggregate Economic Analysis with 3% Discount Rate**  The following table shows the impacts to small businesses associated with a 3% discount rate.

**Table 47**  **. Aggregated Economic Impacts on Small Businesses with 3% Discount Rate** 
**Economic Impact Industry**  **Number of Small Entities Subjec** **t to the Rule and Experiencing Given Economic** 

**Impact Percent of All Small** 

**Entities Subject to the Rule That are**  **Experiencing Given Economic Impact**  Less than 1% for all affected small entities a Agriculture and Crop Support Services 3,780

Grocery & Specialty Food Stores 64,170 Warehouse Clubs & Supercenters 10 Utilities 560 Food Manufacturing 37,840 Beverage & Ice Manufacturing 4,530 Non -food Manufacturing 57,810 General Merchandise Stores <5 Refrigerated Warehousing and Storage 560 Other Warehousing, Storage, and Transportation 3,670 Non - durable Goods Wholesalers and Dealers 43,140 Durable Goods Wholesalers and Dealers 105,750 Educational Services 1,420 Hospitals 90 Research and Development 820 Office Buildings 128,510 Arts, Entertainment, and Recreation 2,250 Reclaimers 50 Refrigerant Wholesalers 193,120 Service Technicians 295,590 Small Can Manufacturers <5 **Total 943,680**  **99%** 1% or more for one or more Agriculture and Crop Support Services <5

Grocery & Specialty Food Stores 40D - 2 October 15, 2015

**Economic Impact Industry**  **Number of Small Entities Subjec** **t to the Rule and Experiencing Given Economic** 

**Impact Percent of All Small** 

**Entities Subject to the Rule That are**  **Experiencing Given Economic Impact**  affected small entities Warehouse Clubs & Supercenters 20

Food Manufacturing 10 Non -food Manufacturing <5 Other Warehousing, Stor, Trans. <5 Durable Goods Wholesalers 20 Office Buildings 20 Small Can Manufacturers <5 **Total 1**  **2 0**  **0.01%** Greater than 3% for one or more affected small entities b Grocery & Specialty Food Stores 10

Warehouse Clubs & Supercenters 20 Non -food Manufacturing <5 Other Warehousing, Stor, Trans. <5 Durable Goods Wholesalers 10 Office Buildings 20 **Total 60**  **0.01%** Totals may not sum due to independent rounding. a Represents small entities affected with an economic impact equal to or lesser than 1% but greater than 0%. b T his category aggregates the number of small entities that would be expected to experience an impact of 1% to 3% with the number of small entities that would be expected to experience an impact of 3% or greater.E - 3 October 15, 2015



# NAICS Codes Appendix E.
**E.1. NAICS Classification for L** **eak R** **epair Requir** **ements**

**Table 48**  **: NAICS Codes Included in the Leak Repair Regulation Analysis Sector**  **Description NAICS Category**  **NAICS Code**  **NAICS Code Definition** Agriculture and Crop Support Activities Support Activities for

Agriculture and Forestry (115) 115112 Soil Preparation, Planting, and Cultivating 115113 Crop Harvesting, Primarily by Machine 115114 Postharvest Crop Activities (except Cotton Ginning) Arts, Entertainment, and Recreation Arts, Entertainment, and

Recreation (71) 711310 Promoters of performing arts, sports, and similar events with facilities 713940 Fitness and recreational sports centers Beverage and Ice Manufacturing Beverage Manufacturing

(312) 312111 Soft drink manufacturing 312112 Bottled water manufacturing 312113 Ice manufacturing 312120 Breweries 312130 Wineries

Durable Goods Wholesalers and Dealers Merchant Wholesalers
-

Durable Goods (423) 423410 Photographic equipment and supplies merchant wholesalers 423740 Refrigeration equipment and supplies merchant

wholesalers 423990 Other miscellaneous durable goods merchant

wholesalers

Motor Vehicle and Parts Dealers (441) 441110 New Car Dealers 441120 Used Car Dealers 441210 Recreational Vehicle Dealers 441222 Boat Dealers 441228 Motorcycle, ATV, and All Other Motor Vehicle Dealers 441310 Automotive Parts and Accessories Stores 441320 Tire Dealers Educational Services Educational Services

(611) 611110 Elementary and second schools 611210 Junior Colleges 611310 College, universities, and professional schools Food M anufacturing Food M anufacturing

(311) 311111 Dog and Cat Food Manufacturing 311119 Other Animal Food ManufacturingE -4 October 15, 2015

**Sector NAICS Category**  **NAICS NAICS Code Definition**  311211 Flour Milling 311212 Rice Milling 311213 Malt Manufacturing 311221 Wet Corn Milling 311224 Soybean and Other Oilseed Processing 311225 Fats and Oils Refining and Blending 311230 Breakfast Cereal Manufacturing 311313 Beet Sugar Manufacturing 311314 Cane Sugar Manufacturing 311340 Nonchocolate Confectionery Manufacturing 311351 Chocolate and Confectionery Manufacturing from Cacao

Beans 311352 Confectionery Manufacturing from Purchased Chocolate 311411 Frozen Fruit, Juice and Vegetable Manufacturing 311412 Frozen Specialty Food Manufacturing 311421 Fruit and Vegetable Canning3 311422 Specialty Canning 311423 Dried and Dehydrated Food Manufacturing 311511 Fluid Milk Manufacturing 311512 Creamery Butter Manufacturing 311513 Cheese Manufacturing 311514 Dry, Condensed, and Evaporated Dairy Product

Manufacturing 311520 Ice Cream and Frozen Dessert Manufacturing 311611 Animal (except Poultry) Slaughtering 311612 Meat Processed from Carcasses 311613 Rendering and Meat Byproduct Processing 311615 Poultry Processing 311710 Seafood Product Preparation and Packaging 311811 Retail Bakeries 311812 Commercial Bakeries 311813 Frozen Cakes, Pies, and Other Pastries Manufacturing 311821 Cookie and Cracker Manufacturing 311824 Dry Pasta, Dough, and Flour Mixes Manufacturing from

Purchased Flour 311830 Tortilla ManufacturingE - 5 October 15, 2015

**Sector NAICS Category**  **NAICS NAICS Code Definition**  311911 Roasted Nuts and Peanut Butter Manufacturing 311919 Other Snack Food Manufacturing 311920 Coffee and Tea Manufacturing 311930 Flavoring Syrup and Concentrate Manufacturing 311941 Mayonnaise, Dressing and Other Prepared Sauce

Manufacturing 311942 Spice and Extract Manufacturing 311991 Perishable Prepared Food Manufacturing 311999 All Other Miscellaneous Food Manufacturing
General Merchandise Stores General Merchandise

Stores (452) 452112 Discount department stores 452990 All other general merchandise stores All Other Miscellaneous Store Retailers (except Tobacco Stores) (453998) 453998 All other miscellaneous store retailers (except tobacco stores)

Grocery and Specialty Food Stores Grocery Stores (4451) 445110 Supermarkets and other grocery (except convenience) stores Specialty Food Stores (4452) 445210 Meat markets 445230 Fruit and vegetable markets 445299 All other specialty food stores Food Service Contractors (72231) 722310 Food service contractors Hospitals Hospitals (622) 622110 General medical and surgical hospitals

Non - durable Goods Wholesalers and Dealers Merchant Wholesalers –

Non - d urable Goods (424) 424210 Drugs and druggists' sundries merchant wholesalers 424410 General line grocery merchant wholesalers 424420 Packaged frozen food merchant wholesalers 424430 Dairy product (except dried or canned) merchant

wholesalers 424440 Poultry and poultry product merchant wholesalers 424460 Fish and seafood merchant wholesalers 424470 Meat and meat product merchant wholesalers 424480 Fresh fruit and vegetable merchant wholesalers 424490 Other grocery and related products merchant

wholesalers 424590 Other farm product raw material merchant wholesalers 424710 Petroleum bulk stations and terminals 424810 Beer and ale merchant wholesalers 424930 Flower, nursery stock, and florists' supplies merchant

wholesalersE - 6 October 15, 2015

**Sector NAICS Category**  **NAICS NAICS Code Definition** 

Non -food Manufacturing Paper Manufacturing

(322) 322121 Paper (except newsprint) mills 322211 Corrugated and solid fiber box manufacturing 322220 Paper Bag and Coated and Treated Paper Manufacturing Printing and Related Support Activities (323) 323111 Commercial Printing (except Screen and Books) Petroleum Manufacturing (324) 324110 Petroleum refineries

Chemical Manufacturing (325) 325120 Industrial gas manufacturing 325180 Other Basic Inorganic Chemical Manufacturing 325211 Plastics material and resin manufacturing 325320 Pesticide and other agricultural chemical manufacturing 325620 Toilet preparation manufacturing 325991 Custom compounding of purchased resins 325998 All other miscellaneous chemical product and

preparation manufacturing Pharmaceutical Manufacturing (3254) 325412 Pharmaceutical preparation manufacturing 325413 In -vitro diagnostic substance manufacturing 325414 Biological product (except diagnostic) manufacturing

Plastics and Rubber Manufacturing (326) 326122 Plastics pipe and pipe fitting manufacturing 326140 Polystyrene foam product manufacturing 326160 Plastics bottle manufacturing 326199 All other plastics product manufacturing 326211 Tire manufacturing (except retreading) Metals Manufacturing (332) 332431 Metal can manufacturing 332812 Metal coating, engraving (except jewelry and

silverware), and allied services to manufacturers 332813 Electroplating, plating, polishing, anodizing, and coloring
Machinery Manufacturing (333) 333241 Food Product Machinery Manufacturing 333242 Semiconductor Machinery Manufacturing 333415 Air- conditioning and warm air heating equipment and

commercial and industrial refrigeration equipment manufacturing 333611 Turbine and turbine generator set units manufacturing Computer and Electronic Product Manufacturing (334) 334112 Computer storage device manufacturing 334419 Other Electronic Component Manufacturing 334413 Semiconductor and related device manufacturing 334419 Other electric component manufacturingE - 7 October 15, 2015

**Sector NAICS Category**  **NAICS NAICS Code Definition**  334510 Electromedical and electrotherapeutic apparatus

manufacturing 334515 Instrument manufacturing for measuring and testing

electricity and electrical systems 334516 Analytical laboratory instrument manufacturing 334613 Blank magnetic and optical recording media

manufacturing Transportation Equipment Manufacturing (336) 336411 Aircraft manufacturing 336415 Guided missile and space vehicle propulsion unit and

propulsion unit parts manufacturing Medical Equipment and Supplies Manufacturing (3391) 339112 Surgical and medical instrument manufacturing Miscellaneous Manufacturing (339999) 339999 All other miscellaneous manufacturing

Office Buildings Publishing Industries

(except Internet) (511) 511110 Newspaper Publishers 511120 Periodical Publishers 511130 Book Publishers 511140 Directory and Mailing List Publishers 511191 Greeting Card Publishers 511199 All Other Publishers 511210 Software Publishers

Motion Picture and Video Industries (512) 512110 Motion Picture and Video Production 512120 Motion Picture and Video Distribution 512131 Motion Picture Theaters (except Drive
- Ins) 512132 Drive - In Motion Picture Theaters 512191 Teleproduction and Other Postproduction Services 512199 Other Motion Picture and Video Industries 512210 Record Production 512220 Integrated Record Production/Distribution 512230 Music Publishers 512240 Sound Recording Studios 512290 Other Sound Recording Industries Broadcasting (515) 515111 Radio Networks 515112 Radio Stations 515120 Television Broadcasting 515210 Cable and Other Subscription Programming Telecommunications 517110 Wired Telecommunications CarriersE - 8 October 15, 2015

**Sector NAICS Category**  **NAICS NAICS Code Definition** 

(517) 517210 Wireless Telecommunications Carriers (except Satellite) 517410 Satellite Telecommunications 51791 Other Telecommunications Data Processing, Hosting, and Related Services (518) 518210 Data Processing, Hosting, and Related Services Libraries and Archives (519) 519120 Libraries and Archives

Credit Intermediation and Related Activities (522) 522220 Sales Financing 522291 Consumer Lending 522292 Real Estate Credit 522293 International Trade Financing 522294 Secondary Market Financing 522298 All Other Nondepository Credit Intermediation 522310 Mortgage and Nonmortgage Loan Brokers 522320 Financial Transactions Processing, Reserve, and

Clearinghouse Activities 522390 Other Activities Related to Credit Intermediation

Insurance Carriers (524) 524113 Direct Life Insurance Carriers 524114 Direct Health and Medical Insurance Carriers 524126 Direct Property and Casualty Insurance Carriers 524127 Direct Title Insurance Carriers 524128 Other Direct Insurance (except Life, Health and Medical)

Carriers 524130 Reinsurance Carriers 524210 Insurance Agencies and Brokerages 524291 Claims Adjusting 524292 Third Party Administration of Insurance and Pension

Funds 524298 All Other Insurance Related Activities

Real Estate (531) 531110 Lessors of Residential Buildings and Dwellings 531120 Lessors of Nonresidential Buildings (except

Miniwarehouses) 531130 Lessors of Miniwarehouses and Self Storage Units 531190 Lessors of Other Real Estate Property 531210 Offices of Real Estate Agents and Brokers 531311 Residential Property Managers 531312 Nonresidential Property ManagersE - 9 October 15, 2015

**Sector NAICS Category**  **NAICS NAICS Code Definition**  531320 Offices of Real Estate Appraisers 531390 Other Activities Related to Real Estate

Professional, Scientific, and Technical Services (541) 541110 Offices of Lawyers 541191 Title Abstract and Settlement Offices 541199 All Other Legal Services 541211 Offices of Certified Public Accountants 541213 Tax Preparation Services 541214 Payroll Services 541219 Other Accounting Services 541310 Architectural Services 541320 Landscape Architectural Services 541330 Engineering Services 541340 Drafting Services 541350 Building Inspection Services 541360 Geophysical Surveying and Mapping Services 541370 Surveying and Mapping (except Geophysical) Services 541380 Testing Laboratories 541410 Interior Design Services 541420 Industrial Design Services 541430 Graphic Design Services 541490 Other Specialized Design Services 541511 Custom Computer Programming Services 541512 Computer Systems Design Services 541513 Computer Facilities Management Services 541519 Other Computer Related Services 541611 Administrative Management and General Management

Consulting Services 541612 Human Resources Consulting Services 541613 Marketing Consulting Services 541614 Process, Physical Distribution and Logistics Consulting

Services 541618 Other Management Consulting Services 541620 Environmental Consulting Services 541690 Other Scientific and Technical Consulting Services 54171 Research and Development in the Physical, Engineering,

and Life SciencesE - 10 October 15, 2015

**Sector NAICS Category**  **NAICS NAICS Code Definition**  541720 Research and Development in the Social Sciences and

Humanities 541810 Advertising Agencies 541820 Public Relations Agencies 541830 Media Buying Agencies 541840 Media Representatives 541850 Outdoor Advertising 541860 Direct Mail Advertising 541870 Advertising Material Distribution Services 541890 Other Services Related to Advertising 541910 Marketing Research and Public Opinion Polling 541921 Photography Studios, Portrait 541922 Commercial Photography 541930 Translation and Interpretation Services 541940 Veterinary Services 541990 All Other Professional, Scientific and Technical Services Management of Companies and Enterprises (551) 551111 Offices of Bank Holding Companies 551112 Offices of Other Holding Companies

Administrative and Support Services (561) 561110 Office Administrative Services 561210 Facilities Support Services 56131 Employment Placement Agencies 561320 Temporary Help Services 561330 Professional Employer Organizations 561410 Document Preparation Services 561421 Telephone Answering Services 561422 Telemarketing Bureaus and Other contact Centers 561431 Private Mail Centers 561439 Other Business Service Centers (including Copy Shops) 561440 Collection Agencies 561450 Credit Bureaus 561491 Repossession Services 561492 Court Reporting and Stenotype Services 561499 All Other Business Support Services 561510 Travel AgenciesE - 11 October 15, 2015

**Sector NAICS Category**  **NAICS NAICS Code Definition**  561520 Tour Operators 561591 Convention and Visitors Bureaus 561599 All Other Travel Arrangement and Reservation Services 561611 Investigation Services 561612 Security Guards and Patrol Services 561613 Armored Car Services 561621 Security Systems Services (except Locksmiths) 561622 Locksmiths 561710 Exterminating and Pest Control Services 561720 Janitorial Services 561730 Landscaping Services 561740 Carpet and Upholstery Cleaning Services 561790 Other Services to Buildings and Dwellings 561910 Packaging and Labeling Services 561920 Convention and Trade Show Organizers 561990 All Other Support Services Museums, Historical Sites and Similar Institutions (712) 712110 Museums 712130 Zoos and Botanical Gardens Accommodation (721) 721110 Hotels (except Casino Hotels) and Motels 721120 Casino Hotels

Religious, Grantmaking, Civic, Professional, and Similar Organizations (813) 813110 Religious Organizations 813211 Grantmaking Foundations 813212 Voluntary Health Organizations 813219 Other Grantmaking and Giving Services 813311 Human Rights Organizations 813312 Environment, Conservation and Wildlife Organizations 813319 Other Social Advocacy Organizations 813410 Civic and Social Organizations 813910 Business Associations 813920 Professional Organizations 813930 Labor Unions and Similar Labor Organizations 813940 Political Organizations 813990 Other Similar Organizations (except Business,

Professional, Labor, and Political Organizations)E - 12 October 15, 2015

**Sector NAICS Category**  **NAICS NAICS Code Definition** 

Other Warehousing, Storage, and Transportation Transportation and

Warehousing (48) 484220 Specialized freight (except used goods) trucking, local 488119 Other airport operations 488510 Freight transportation arrangement 488991 Packing and crating Warehousing and Storage (4931) 493110 General warehousing and storage 493130 Farm product warehousing and storage 493190 Other warehousing and storage Refrigerated Warehousing and Storage Refrigerated

Warehousing and Storage (49312) 493120 Refrigerated warehousing and storage Research and Development Research and

Development (5417) 54171 Research and development in the Physical, Engineering and Life Sciences

Utilities Utilities (221) 221111 Hydroelectric Power Generation 221112 Fossil fuel electric power generation 221113 Nuclear Electric Power Generation 221114 Solar Electric Power Generation 221115 Wind Electric Power Generation 221116 Geothermal Electric Power Generation 221117 Biomass Electric Power Generation 221118 Other Electric Power Generation 221121 Electric Bulk Power Transmission and Control 221122 Electric power distribution 221210 Natural gas distribution 221310 Water supply and irrigation systems 221320 Sewage treatment facilities 221330 Steam and air
- conditioning supply Oil and gas extraction (211) 211111 Crude petroleum and natural gas extraction Warehouse Clubs and Supercenters Warehouse Clubs and

Supercenters (45291) 452910 Warehouse clubs and supercenters Source: U.S. Census Data. 2012.E - 13 October 15, 2015



# E.2. **NAICS Classification for Small Can Requirements**  **Table 49**  **: NAICS Codes**  **Included in the**  **Small -** **c an Analysis**  **Industry NAICS**  **Code Definition**  Small Can Manufacturers 441310 Automotive Parts and Accessories Stores 325120 Industrial Gas Manufacturing Source: U.S. Census Data. 2012. 

# E.3. **NAICS Classification for Recordkeeping and Reporting Requirements**  **Table 50**  **: NAICS Codes Included in the Recordkeeping and Reporting Requirements Analysis Industry**  **NAICS**

**Code Definition**  Reclaimers 325120 Industrial Gas Manufacturing 423930 Recyclable Material Merchant Wholesalers 562920 Materials Recovery Facilities 562212 Solid Waste Landfill 424690 Other Chemical and Allied Products Merchant Wholesalers Disposal Establishments 562920 Materials Recovery Facilities 562212 Solid Waste Landfill 423990 Other Miscellaneous Durable Goods Merchant Wholesalers Service Establishments 811310 Commercial Industrial Machinery and Equipment (not Automotive and Electronic) Repair and Maintenance 811412 Appliance Repair and Maintenance Refrigerant Wholesalers 325120 Industrial Gas Manufacturing 424690 Other Chemical and Allied Products Merchant Wholesalers 42 Wholesale Trade Small Can Manufacturers 441310 Automotive Parts and Accessories Stores 325120 Industrial Gas Manufacturing Service Technicians 238220 Plumbing, heating, and air- conditioning contractors Source: U.S. Census Data. 2012.F - 14 October 15, 2015



# Costs Incurred by DIYers **for a**  **Sales Restriction** Appendix F.
To estimate the costs incurred by DIYers for a refrigerant sales restriction without an exemption for small cans , total annual sales of DIY small cans (14.1 million) were divided by the average number of cans used per servicing event (1.3). The result ( 10.8 million ) is assumed to be equivalent to the number of annual DIY servicing events that would necessitate a DIYer to either become a certified technician under section 609 or take her or his vehicle to a professional service shop. Table 51 and Table 52 below show key assumptions and the estimated costs incurred by DIYers for each course of action.

**Table 51**  **. Costs Incurred by DIYers to Take Vehicle to a Professio nal Service Shop**  **Action to Comply with**  **Sales Restriction Annual Sales** 

**of R -**  **134a Small Cans to**  **DIY Market 1**  **(millions) Number of** 

**Annual Servicing**  **Events 2**  **(millions) C** **ost of**

**Professional Service Job**  **3 Cost of R** **- 134a** 

**Small Can 4**  **Percent of**

**DIY ers Who**  **Would Forgo**  **AC 5**  **Total Annual**  **Cost**

**to DIYers (million**  **$) 6** **,7** Take vehicle to professional service shop 14 .1 10.8 $50
–$200 $7.49
–$19.99 19% $333.2
–$1,473.1
1 Represents an average of the total R
- 134a cans sold in the United States in 2006 and 2007 ( NPD 2008; CARB 2009 b ). 2 Based on research commissioned by CARB, the average number of cans used per recharging event is 1.3 ( Clodic et al. 2008 ; CARB 2009 b ). 3 Based on a survey of professional shops, costs for a professional diagnosis and recharging range from $50 to $200 ( Clodic et al. 2008 ). 4 Based on various results from an online search. 5 Based on research commissioned by CARB, 19% of DIYers would opt to forgo AC rather than take their vehicles to a professional service shop ( Clodic et al. 2008 ; CARB 2009 b ). 6 Total a nnual costs exclude DIYers who would opt to forgo AC. 7 Total annual costs exclude the cost to purchase a can of R
- 134a since the cost of the refrigerant is already factored into the cost for a professional service job.



### Table **52 .**  **Costs Incurred by DIYers to Become a**  **609 Certified Technician**  **Action to Comply with**  **Sales Restriction**  **Annual Sales**

**of R -**  **134a Small Cans to**  **DIY Market 1**  **(millions) Number of** 

**DIY Vehicles**  **2 ,3**  **(millions) Number of** 

**DIY Operators** **4 (millions)**  **C ost of 609** 

**Technician Certification**  **Training Manual & Exam**  **5 Percent of** 

**DIY ers**  **Who Would**  **Forgo AC 6**  **Total Annual**  **Cost**

**for DIYers to Become Certified**  **Technicians (million $)**  **7,8** Become a certified technician under section 609 14.1 10.8 7.1 $20 19% $114.5F - 15 October 15, 2015 1 Represents an average of the total R
- 134a cans sold in the United States in 2006 and 2007 (NPD 2008; CARB 2009 b ). 2 Based on research commissioned by CARB, the average number of cans used per recharging event is 1.3 ( Clodic et al. 2008 ; CARB 2009 b ). 3 Assumed a DIY s ervice rate of once per year per vehicle (CARB 2009b) . 4 Assumed some DIYers own and service more than one vehicle per year. According to data from the Oak Ridge National Laboratory on household vehicle ownership, approximately 38% of households own one ve hicle, 41% of households own two vehicles, and 21% of households own three or more vehicles (ORNL 2014). 5 Based on various results from an online search. 6 Assumed 19% of DIYers would opt to forgo AC rather than become a certified technician ( Clodic et al . 2008 ; CARB 2009 b ). 7 Total annual costs exclude DIYers who would opt to forgo AC. 8 Total costs do not include the value of leisure time a DIYer would spend to become a 609 certified technician.