Comments Of BASF Corporation’s On US EPA’s Proposal to Change the Listings from Acceptable to Unacceptable For HFC

– 134a, HFC

– 245fa, HFC

– 365mf c, And Any Blends Containing These Blowing Agents For All Foam End

- Uses And Applications Except For Spray Foam As Of January 1, 2017

October 17, 2014 The following comments are submitted on behalf of BASF Corporation in response to the EPA ’s propos ed

ru lemaking under Docket ID No. EPA

– HQ

– OAR

– 2014

– 0198 : “ Protection of Stratospheric Ozone: Change of Listing Status for Certain Substitutes under the Significant New Alternatives Policy Program .”
BASF remains highly concerned that the accelerated timing is i mpractical for large parts of our industry, given the absence of “drop

- in” replacements for blowing agents in polyurethane foam. Without significant grandfather periods, there is a real potential for the construction products business, consumer appliance b usiness, and energy conservation efforts currently on

- going throughout to suffer significant adverse impacts.

Adverse Impact of EPA’s Proposal on Federal Energy Use Efficiency Programs
In its proposal, EPA request ed comment on “ the effects this propos al would have on the energy efficiency of the commercial refrigeration end

- uses addressed and in particular the effect, if any, this proposal would have

on m eeting applicable DOE standards ” but did not otherwise solicit comments concerning its impact acros s the Federal e n ergy use efficiency p rograms (79 Fed Reg. 46147 ).
BASF is concerned about potential negative impacts that the impractical time frame set forth in EPA’s proposal could bear upon the advancement of federal efficiency standards and policies seeking to improve efficiency and performance in both appliances and buildings . We question whether EPA has sufficiently coordinated this initiative with 

### the U.S. Department of Energy (DOE) and other federal agencies charged with reducing energy use in b uildings and appliances. Foam materials provide high

- performance insulation which saves energy throughout the entire, relatively long, life cycle of homes and buildings. The impractical time frame set forth in EPA’s proposal may jeopardize the continuity of the energy efficiency benefits currently delivered by foam materials.
BASF highly recommends coordination and collaboration about the potential impact of this Proposed Rule within and among all federal agencies charged with reducing energy use in bu ildings and appliances including, but not limited to, the U.S. Department of Energy, the U.S. Department of Defense, U.S. General Services Administration, and the U.S. EPA. As such, the federal government must be considerate of the lifetime energy use red uctions in buildings delivered from the use of foam materials. Energy use reductions in buildings also reduces GHG emissions associated with buildings, currently estimated at one

- third of all GHG emissions globally (citation: UN Environment Programme, Sus tainable Buildings & Climate Ini ti ative, page 6 of this PDF link

- http://www.unep.org/sbci/pdfs/SBCI

- BCCSummary.pdf )


### 3Spray Foam
BASF strongly supports the current EPA SNAP exemptions pro posed for spray foam. Before turning to the end uses subject to EPA’s proposal , BASF offers the following comments and questions regarding the proposed HFC exemption for spray foam.
Spray foam is traditionally field applied. As a result the formulatio ns require extended shelf life under a variety of environmental conditions. While reportedly a great deal of formulation work has been done to increase shelf life with the next generation HFO’s, not all of the proposed HFO molecules have the shelf life

ne eded to make them acceptable alternates in the field.
Impact of Reactive HFOs on Shelf Life : The next generation HFO’s a re designed to break down resulting in low GWP. One of the factors that accelerate the breakdown of one of the HFO molecules is a st rong base, for example, the strongly basic amine catalysts used in most polyurethane chemistry and used at very high levels in spray foam. Spray foam, in particular, requires high levels of very active amine catalysts to drive the reaction rates. These v ery active catalysts cause rapid chemical breakdown of one of the HFO molecules releasing HF acid (hydrofluoric acid) which in turn breaks down the surfactants in the formulation causing cell and foam collapse. This mechanism has been widely documented by one of the HFO manufacturers. It has been BASF’s experience that initial thermal properties suffer and aged thermal properties degrade rapidly with HFO

- 1233zd in spray foam applications

. Current ly suggested solutions may improve the shelf life of spray f oam made using next generation HFO’s but they have not been proven to be effective in all spray foam formulations. Evaluations of alternate catalyst and surfactant packages have started but will likely take several years to achieve and optimize.

Lack o f Drop

- In Alternatives : BASF also supports the HFC exemptions for spray foam because of the lack of available alternates. Since spray foam is typically field applied it is very difficult to control the environment during the application , which is why spr ay foam applicators are required to wear extensive PPE (personal protective equipment). Unlike other polyurethane applications , spray foam cannot readily transition to hydrocarbon blowing agents as an acceptable option due to flammability concerns. Curre ntly there would only be one commercially available HFO option available to evaluate and even this molecule has shelf stability concerns. Commercial HFO alternates which may have better shelf stability have not been TSCA or SNAP approved to date and there fore it has been difficult to complete an evaluation to determine if t hey are acceptable alternates. We understand that p roduction of the alternate HFO molecule is not slated to be complete until late 2016 or early 2017. If not exempt, t his would leave no time to complete formulation modifications and obtain the full battery of third party credentials required (fire testing, physical property attributes, etc.) to commercialize spray foam formulations based on the next generation HFO’s.
Commercial Impact s of Inadequate Testing Opportunities : One commercial concern u nique to spray foam applications involves warranties. Many spray foam roof ap plications can carry up to a 30

- year limited 

### 4warranty , and must do so to be competitive in the market . A tremendo us amount of field testing goes into any formulation changes to spray foam roofing formulations to avoid claims against those warranties. In many cases field installations are monitored for 1

- 2 years before a formu lation change is fully approved for

comme rcial use

. During previous blowing agent changes , there were numerous claims due to unduly accelerated testing. BASF supports the spray foam exemption to allow sufficient time to properly field test foam roof applications made using the next generation b lowing agents. Otherwise, polyurethane foam manufacturers like BASF could face enormous claims associated, for example, with delayed or latent shrinkage of the finished foam, field failures due to foam delamination and blisters, or insufficient fire resist ance.
Need for Definition of Spray Foam Applications : BASF requests further clarification and definition of spray foam applications. There are many field applied and plant applied processes that use the same equipment and have the same shelf life lim itations as spray foam. Many of these applications still use HFC’s as foam blowing agents, processing aids or to maintain physical properties in the application. These applications include but a re not limited to the following:

• Industrial piping appli cati ons

• Slab jacking or ground stabilization

• Flotation applications

– boats, floating docks, barges

• Spas and bath manufacture
Many of these applications use spray foam equipment but may have a slightly modified spray tip to either control the spray pattern o r dispense the material at a distance. The primary difference in these applications is mechanical to control the spray pattern but the chemistry may be very similar to traditional spray foam chemistry. It is unclear in the current proposal if these appli cations would qualify as exempt spray foam applications or pour

- in

- place applications which would not qualify for exemption.

HFC Blend Flexibility : Finally, b efore turning to other end uses, BASF recommends that EPA offer wider flexibility to the use o f mixtures of HFCs (other than HFC

- 134a) in spray foam. In the preamble to the Proposed Rule , EPA notes:
“Thus, EPA is proposing to find HFC

– 134a and blends thereof and Formacel TI unacceptable in this application. We are proposing that HFC

– 245fa; com mercial blends of HFC

– 365mfc and HFC

– 227ea, containing 7% to 13% HFC

– 227ea and the remainder HFC

– 365mfc; and blends of HFC

– 365mfc and at least 5% HFC

– 245fa remain acceptable in spray foam because these three nonflammable foam blowing agents reduce overall risk compared to the available flammable alternatives.” 1

1 Proposed rule at page 46152. 

### 5BASF proposes that EPA add a provision allowing blends of HFC

- 365mfc, HFC

- 227ea and HFC

- 245fa, so that a broader range of options utilizing only these three nonflammable foam blowing agents could b e used.
The revised preamble language would then say (showing changes in red):
Thus, EPA is proposing to find HFC

– 134a and blends thereof and Formacel TI unacceptable in this application. We are proposing that HFC

– 245fa; commercial blends of HFC

– 365m fc and HFC

– 227ea, containing 7% to 13% HFC

– 227ea and the remainder HFC

– 365mfc; commercial blends of HFC

– 365mfc and HFC

– 227ea (previously described) combined with HFC

- 245fa ; and blends of HFC

– 365mfc and at least 5% HFC

– 245fa remain acceptable in spray foam because these three nonflammable foam blowing agents reduce overall risk compared to the available flammable alternatives.
We now turn to our primary concerns with EPA’s proposal.
EPA’s Proposed January 1, 2017 Effective Date of the “Unacceptable Su bstitute” Listings for the Referenced HFC s S hould b e extended via “Grandfathering” for All Non

- Spray Polyurethane Foam Uses
Certain aspects of EPA ’s Proposed Rule on the phase out timing of HFC blowing agents would cause undue burden and be highly detri mental to our industry . That adverse impact could only be mitigated by grandfathering certain existing uses

. BASF submits that the following phase

- in schedule is justified and appropriate assuming a sufficient supply of each required blowing agent is rea dily available to support industry

- wide polyuret hane foam conversion efforts by January 1, 2016:

• Walk

- in cooler panel foams

– not before January 1, 2020;

• Continuously produced insulated metal panels

-- not before 2019;

• Marine Floatation

– not before July 1 , 2019 ;

• Commercial Refrigeration

– not before July 1, 2019 ;

• Garage door applications and refrigerated transport

-- not before July 1, 2018;

• Domestic Refrigeration

– not before July 1, 2017 ;

• Integral Skin

– not before July 1, 2017 ;

• HVAC panels and residenti al entry door applications

-- not before July 1, 2017.
Application of EPA’s four

- part test to judge the appropriateness of agency grandfathering supports the conclusion that, for each of the end uses listed in proposed 40 CFR § 82 Subpart G, Appendix U, T able 5A , the referenced extension s to the proposed January 1, 2017 effective date of the “ Unacceptable Substitute ” listing for HFC

– 134a, HFC

– 245fa, HFC

– 365mfc and blends thereof is warranted. As a result, BASF proposes that the use of HFCs in support of a variety of existing end uses be grandfathered as proposed above

.


### 6Overview
EPA is proposing to change the SNAP listings from acceptable to unacceptable beginning January 1, 2017, except where allowed under a narrowed use limit, for HFC

– 134a and blends t hereof in all foam blowing end

uses, and for HFC

– 365mfc, HFC

– 245fa and blends thereof for all foam blowing end

- uses except spray foam applications. 2 Other than spray foam, spec ific end

- uses and applica tions subject to EPA’s proposal include: (1) Rigid p olyurethane appliance foam; (2) flexible polyurethane; (3) rigid polyurethane: commercial refrigeration, and sandwich panels; (4) rigid polyurethane (slabstock and other); (5) rigid polyurethane and polyisocyanurate laminated boardstock; (6) integral skin polyurethane; (7) polystyrene (extruded sheet); (8) polystyrene: extruded boardstock and billet; (9) polyolefin foam ; and (10) phenolic insulation board and bunstock

. 3
Timing
In its proposal, EPA solicited information from commenters as to whether its pr oposed transitions could be completed even earlier, by January 1, 2016:

“ We are also seeking comment on whether a transition could be completed by January 1, 2016. In particular, we request comment on whether these dates would be sufficient time for the transition where the foam product is incorporated into a larger product (e.g., commercial refrigeration foam used in transport refrigeration), and whether there are any specific foam end

- uses or applications that may require additional time and, if so, how long and why.
Based on this information, EPA could consider grandfathering options for foam blowing agents in specific end

- uses or could provide a different date for use to be unacceptable. ” 4

BASF submits that , for all of the listed polyurethane non

- s pray foam applications, EPA’s proposed 2017 deadline is technically infeasible and that a 2016 deadline would be out of the question

. EPA has significantly underestimated the hurdles that must be overcome by system houses in order to transition existing f oam sector applications before the proposed January 1, 2017 deadline, at which point such us es of HFC

– 134a, HFC

– 245fa, HFC

– 365mfc and blends thereof would be deemed “Unacceptable. ” 5 The need for

2 As proposed, the narrowed use limit for HFC

– 134a, HFC

– 245fa, HFC

– 365mfc and blends thereof would apply only to military or space

- and aeronautics

- related applications and would expire on January 1, 2022.

3 US EPA Proposed Rule, Section V.D. “Foam Blowing Agents,” 79 Fed Reg. 46150 (August 6, 2014)

4 See “When would the listings change?” Section V.D.2.d., US EPA’s Proposed Rule at p. 46154

5 In this context, “existing use” w ould be defined as a current use of HFC

– 134a, HFC

– 245fa, HFC

– 365mfc and blends thereof to manufacture actual foam products that are sold into commercial markets. See 70 Fed Reg

. 67124, Footnote 5.


### 7up to an ad ditional three ( 3 ) years’ time f or existing polyu rethane non

- spray foam applications to make that transition is well supported under EPA’s so

- called “grandfather” analysis.
Appropriateness of Agency Grandfathering
EPA’s proposed January 1, 2017 deadline apparently reflects a decision not to grandfath er any existing use s beyond the January 1, 2017 deadline

. In fact, grandfathering of such existing uses for periods up to four (4) years is fully justified based on EPA’s analysis under the four

- part test it established in Sierra Club v. EPA (719 F.2d 43 6 (DC Cir . 1983)) , as discussed on page 13057 of EPA’s original SNAP rule (published March 18, 1994):

“The United States District Court for the District of Columbia Circuit has established a four

part test to judge the Appropriateness of Agency grandfath ering (see Sierra Club v. EPA , 719 F.2d 436 (DC Cir. 1983)). This test involves balancing the results of four analyses, including whether the new rule represents an abrupt departure from previously established practice, the extent to which a party relied o n the previous rule, the degree of burden which application of the new rule would impose on the party, and the statutory interest in applying the new rule immediately.” 6

1. EPA’s Proposed Rule represents an abrupt departure from previously established practi ce

. The first part of the four

- part test to judge the appropriateness of agency grandfathering asks whether the proposal represents an abrupt departure from previously established practice. Answer: It most certainly does. In the Proposed Rule, in discuss ing its basis for the January 1, 2017 deadline for transitioning away from HFC

– 134a, HFC

– 245fa, HFC

– 365mfc and blends thereof in such applications, EPA simply noted:
Through this action, EPA is proposing to change the listings for foam blowing agents as of January 1, 2017. Based on information concerning the timeframes from past transitions, EPA believes this date allows sufficient opportunity to redesign for a different foam blowing agent. 7

EPA’s decision not to grandfather any existing uses reflect s a n abrupt and short sighted departure from previously established practice. In its most recent SNAP rulemaking to revise the listings of blowing agents

6 “Protection of Stratospheric Ozone”; Final Rule ENVIRO NMENTAL PROTECTION AGENCY; FR DOC # 94

- 4753 Available at http://www.gpo.gov/fdsys/pkg/FR

- 1994

- 03

- 18/html/94

- 4753.htm . “This test involves balancing the results of four analyses, including whether the new rule represents an abrupt departure from previously established practice, the extent to which a party relied on the previous rule, the degree of burden which application of the new rule would impose on the party, and the statutory interest in applying the new rule immediately.”

7 Proposed Rule at page 46154 (79 Fed Reg. 46154).


### 8used in the foam sector, EPA granted certain existing users of HCFCs a grandfathering period, allowing th e continued use of HCFC

– 22 and HCFC

– 142b f or an extended period of time (e.g., for pour foam and marine foam applications). Moreover, in its July 11, 2000 proposed rulemaking, it proposed a grandfather period: “Current HCFC

– 22/

– 142b use would be grandfath ered until January 1, 2005.”

EPA goes on to claim in the Proposed Rule that the “foam industry was able to convert from HCFC

– 142b and HCFC

– 22 to other acceptable substitutes between EPA’s proposed unacceptability determination in November 2005 and its fi nal determination in March 2007, which specified that existing users of the unacceptable HCFCs must transition by March 1, 2008, for most uses. 8 This claim ignores the fact that EPA’s plans to require substitution for HCFC

– 22 and HCFC

– 142b were telegraphe d to industry as early as 2000 , when proposed by EPA, and even as early as 1993 in the first SNAP final rulemaking

. 9
, 10 Even though EPA withdrew its 2000 proposal in 2002 then re

- proposed it 2005, industry knew that a final EPA unacceptability determinatio n for these blowing agents was only a matter of time , and so had at many years’ lead time to formulate, qualify and otherwise obtain the certifications and other credentials necessary to sell the final products in the end use industries

. 11 Under the current proposal, industry has had very little time to begin the long process of reformulating its many and varied products using HFOs. And w hile industry has had more time to work with hydrocarbons such as cyclopentane, the resulting flammability concerns limit the practical scope of HC applications.
Moreover, in claiming in the preamble to its proposal that the “foam industry was able to convert from HCFC

– 142b and HCFC

– 22 to other acceptable substitutes between EPA’s proposed unacceptability determination in November 2005 and its final determination in March 2007,” EPA also ignores one other major difference between the HCFC

– 22 /HCFC

– 142b substitution and its current proposal: Ready

a vailability of drop

- in alternate blowing agent s . The alternative s , namely H FC

- 245fa , HFC

– 365mfc and

8 See “Protection of Stratospheric Ozone: Listing of Ozone Depleting Substitutes in Foam Blowing;” EPA Final Rule; 72 Fed Reg. 14432 (March 28, 2007).

9 See 65 Fed Reg. 42653 (July 11, 2000): “In this Notice of Proposed Rulemaking, EPA is proposing the following decisions on the acceptability of substitutes in the foams sector: To list HCFC

– 141b and blends thereof as unacceptable as substitutes in all foa m end

- uses. Current HCFC

– 141b use would be grandfathered (i.e., allowed to continue) until January 1, 2005. To list HCFC

– 22, HCFC

– 142b, and blends thereof as unacceptable as substitutes in all foam end

- uses. Current HCFC

– 22/

– 142b use would be grandfathere d until January 1, 2005.”

10 58 Fed Reg. 65018 (December 10, 1993): “Specifically, the Agency will ban the production and consumption of HCFC

- 141b as of January 1, 2003. The production and consumption of HCFC

- 142b and HCFC

- 22 will be frozen at baseline le vels in 2010, with a complete phaseout of these chemicals by January 1, 2020.”

11 See 67 Fed Reg. 47703 (July 22, 2002) “Today's action: Withdraws the proposed decision to list HCFC

- 22 and HCFC

142b as unacceptable substitutes for existing users ....”; and 7 0 Fed Reg. 67120 (November 4, 2005): “Today the Environmental Protection Agency (EPA) is proposing to determine that HCFC

– 22 and HCFC

– 142b are unacceptable for use in the foam sector under the Significant New Alternatives Policy (SNAP) Program under secti on 612 of the Clean Air Act.”


### 9HFC

- 134a , were widely available. In this case, the alternative low GWP blowing agents that are readily available right now are either flammable and/ or or have very limited performance history in most foam end

use applications

.
The challenges to the polyurethane system houses resulting from the 2007 transition away from HCFC

– 22 and HCFC

– 142b will pale in comparison to the challenges faced when transitioning from HFC s to HFOs or hydrocarbons (HCs)

. One or more of BASF business un its in its Performance Materials Division have concerns with products made to date using such HFOs and HCs, including :

- Loss of process latitude (adhesion, loss of dimensional stability, loss of cold temperature processing latitude, delamination)

- Loss of foam flammability performance

- Loss of chemical shelf stability

- Incompatibility of HFO with a variety of polymers used in affected end use applications

- Energy performance and a lack of long term performance data whe re insulation value is specified

Histor y will likely show that the relatively short transition time frame EPA mistakenly associates with the 2007 Final SNAP Rule to be artificially brief , for reasons described above. More commonly, EPA has found the foam sector to require at least four years i n order to make such transitions , as was noted in a 2005 EPA file memo summarizing the conclusions of various EPA consultants:

.... Once there is an alternative blowing agent that is EPA approved and available, it can take up to four years to complete the tr ansition from one blowing agent to another. EPA has based this four year determination on its assessment of the activities necessary to transition as explained in separate but related rulemakings. 12

2. The Extent to Which a Party Relied on the Previous Rule

The second part of the four

- part test to judge the appropriateness of agency grandfathering asks about the extent to which the requesting party relied on the previous rule. The polyurethanes industry in which BASF participates has invested millions of dol lars over the past decade completing its transition to the use of the referenced HFC blowing agents: developing formulations , products, and conducting the full battery of testing (fire testing, physical properties) necessary to obtain third party credentia ls required to commercialize the end use products based on HFCs. Rather than bear the fruits of those investments, EPA’s proposed rule would require that industry begin again largely from scratch, often required to use HFO blowing agents with limited avai lability and offering technical and safety challenges not encountered in the use of HFCs

.

12 See August 11, 2005 EPA File Memo from Suzie Kocchi, “Four year transition time period in the foam sector”; EPA

HQ

- OAR

- 2004

- 0507

- 0014.pdf, available at http://www.regulations.gov

. (Copy attached.) 

### 10BASF remain s highly concerned that the accelerated timing is impractical for large parts of our industry, given the absence of “drop

- in” replacements for blowing ag ents in polyurethane foam. Without significant grandfather periods, there is a real potential for the construction products business, consumer appliance business, and energy conservation efforts currently on

- going throughout to suffer significant adverse i mpacts.

3. The New Rule Would Impose Very Significant Burdens on System Houses and their Customers’ Manufacturing and Selling Rigid Insulating F oams. The third part of the four

- part test to judge the appropriateness of agency grandfathering asks about the degree of burden which application of the new rule would impose on the party. Simply put, it is not possible for polyurethane foam systems houses to meet t he proposed January 1, 2017 deadline , which would further challenge the commercial availability of alternatives to existing blowing agent technology, significant ly increase the cost s to implement new blowing agent technology, and present a widespread industry rush to formulat e , qualify and otherwise obtain the certifications and other credentials necess ary to sell the final product in the end use industry segments in time to meet the proposed January 1 , 2017 deadline

. As an alternative proposal , BASF support s the scheduled phase out of the referenced HFCs as blowing agents for

non

- spray polyurethane foa ms (also outlined at the beginning of these comments ) , assuming a sufficient supply of each required blowing agent is readily available to support industry

- wide polyurethane foam conversion efforts by January 1, 2016:

• Walk

- in cooler panel foams

– not before January 1, 2020;

• Continuously produced insulated metal panels

-- not before 2019;

• Marine Floatation

– not before July 1, 2019 ;

• Commercial Refrigeration

– not before July 1, 2019 ;

• Garage door applications and refrigerated transport

-- not before July 1, 20 18;

• Domestic Refrigeration

– not before July 1, 2017 ;

• Integral Skin

– not before July 1, 2017 ;

• HVAC panels and residential entry door applications

-- not before July 1, 2017.

These grandfathering proposals, which are drawn from the experience and know

- how of the Technical Managers responsible for the polyurethane foam products sold by BASF’s Constructions and Consumer Products Division s , will be explored below.

Commercial Availability of HFO Blowing Agents
Commercial quantities of 1233zd (E) are currently a vailable only from Honeywell. Arkema has made s mall trial quantities of 1233zdE available. DuPont is reportedly in the process of obtaining TSCA and SNAP/Foam Sector approval for a d ifferent HFO product. While t hese manufacturers will likely confirm the commercial availab ility of their own products , BASF has received indications that the available supply as of



### 11January 2017 will be insufficient to meet the needs of all affected industries. I n addition, the patent litigation between Honeywell and Arkema ma y further complicate the availability of HFO 1233zd(E)

.
Other a lternative low GWP blowing agents (hydrocarbons, for example) are readily available but require significant time and capital investment to develop viable products and manufacturing platforms. The f lammability of these products would require significant capital investment to make manufacturing facilities intrins i cally safe

. Timing
As EPA previously noted in its August 11, 2005 EPA File Memo (apparently written in connection with its “Proposed R ule 13”) , system houses need to conduct several activities when transitioning to an alternative blowing agent(s):

“ EPA believes that it could take foam manufacturers up to four years to transition to alternatives. EPA considered that companies might need to conduct several activities during that time period, including: (1) Obtain permits or make modifications to existing permits; (2) Make changes to equipment in order to optimize production and ensure worker safety; (3) Establish raw material suppliers; (4 ) Develop formulations; (5) Test final products; and (6) Obtain final product review and approval by relevant boards or agencies. ”
EPA’s 2005 comments remain credible today. BASF understands the serious pitfalls associated with accelerated implementation of new blowing agent technologies. In the conversion from CFC’s to HCFC’s , we experienced serious product quality issues that caused shrinkage and hence unacceptable performance of finished products only after they reached the retail shelves, resulting in significant product defect claims

. Given the regulatory deadlines, w e were forced to end the testing prematurely in order to meet the timing required for delivery of the new product. This problem could have been avoided had we been able to complete dimen sional stability testing

. The conversion now proposed by EPA presents far greater timing challenges.

The time needed to implement the changes across each of the affected end

- uses is significant , as outlined below and in the chart attached to these comment s :

• Product Development : We estimate that simply introducing and qualifying new product offering s at each of our affected customers will take a full year to complete.



### 12• Certification/Testing : Once the commercial products are approved by the customer, we need to obtain flammability and other certifications to obtain agency and/or customer approval

. Flammability certification of foam products and unit construction is a requirement of selling into many of our rigid insulation applications , including walk

- in coolers and insulated metal panel applications . These approvals are only granted by private laboratories such as UL (Underwriter’s Laboratories) and FM Global (Factory Mutual Insurance Company) and are needed to support compliance with local fire or buil ding codes, industry consensus standards, internal manufacturer and/or customer approval criteria.

o As the change in blowing agent affects foam sect or industries nationwide, the testing laboratories are likely to run into serious capacity constraints regard ing their ability to provide individual product certifications per customer. As the process is often iterative, requiring processing adjustments and retests, these delays will have a compounding effect on the industry’s ability to change all product formu lations in less than 3 years’ time

. Anecdotally, we understand that there is currently a six

- month wait to conduct burn testing at FM Global during a “normal” product change cycle. 13

• Commercialization : Another eighteen months beyond that would be needed to d evelop the new products

- which var y with end

- use application and blowing agent choice. As some conversions will require new processing equipment, it should be noted that new polyurethane foaming equipment lead time is currently 16

– 20 weeks and will likely lengthen with increased demand. This timing does not include engineering or installation and commissioning time.
BASF does have some experience with HFO conversion in our Consumer Products business. BASF and Whirlpool Corporation completed a n im plementation of an HFO blown foam for domestic refrigeration

. 14 This project required a full five years from product development to commercialization without the added time to conduct flammability certification testing at FMGlobal or UL. While w e expect to leverage the formulation expertise gained in this effort to assist in the product development for other applications , this extraordinarily long timeline may not be unusual.
Rigid foams find use in multiple applications/products. BASFs Performance Materi als’ Construction Division generally segment s these applications into the following categories: entry doors, HVAC (Heating Ventilation and Air Conditioning) , bath and spa, refrigerated transport, insulated metal panels , domestic refrigeration, commercial refrigeration, marine flotation and walk

- in cooler panels. In our analysis we conclude that the walk

- in cooler panels will probably require the most time to convert to new blowing agent technologies. These applications present the greatest challenges to the product formulator to balance physical properties, processing ease and flammability performance. Specific aspects of these conversion examples , as

13 Personal communication, Walter White, Technical Service Manager, BASF Polyurethane Systems.

14 See http://www. basf.com/group/corporate/en_GB/news

- and

- media

- relations/news

- releases/news

- releases

- usa/P

- 13

- 628 

### 13well as examples drawn from BASFs Performance Materials’ Consumer Products Division, are described below

. Rigid Insulating Foams Conversion Example 1: Walk

- in Cooler Panels

For walk

- in cooler applications BASF will typically spend 12

- 18 months developing chemistry to meet the needs of our customers. There are significant challenges to be overcome for this market segment. Shelf

- life stability of the resin systems containing HFO blowing agents is the first technical hurdle to overcome. The low GWP (Global Warming Potential) of the HFO blowing agents is due, in part, to their inherent reactivity. This caus es the HFO to be susceptible to attack from catalysts necessarily present in the resin blend. This attack generates hydro fluoric acid which consumes the silicone surfactant and may cause “ course cells ” or complete f oam collapse.

A related failure is de layed or latent shrinkage of the finished foam. We attribute this to the reaction of the catalysts present in the reacted foam matrix with the HFO blowing agent present in the cell. The small molecules liberated from this reaction migrate out of the cell s faster than they are replaced by other gases forming a partial vacuum and resulting in foam shrinkage. This process is analogous to the known process for the shrinkage of closed cell water blown foams due to the differential migration rates of carbon di oxide and air.
The next challenge to be tackled is the development of a flame retardant package that protects the foam while maintaining the flow and reactivity properties. Changes in blowing agent present significant challenges here as flame retardants generally degrade the processability of foam systems and necessitate significant experimentation. Based upon previous efforts and experimentation HFO blowing agents we estimate it will take 12

- 18 months to co mplete our product development. Completion of the initial product development will be followed by UL and FM qualification as outlined above. A product development effort lasting 1

- 1.5 years coupled with an agency approval process of approximately 3 years will mean that products will first be ready f or commercial launch in 4

- 4.5 years. Based upon the number of customers and plant combinations BASF supplies, we expect launch and commercialization activities to last a minimum of one full year. Under a best case scenario, t he time to complete product development coupled with the agency approval processes and the efforts necessary to implement new products in manufacturing necessitates a timeframe of between 5 and 5 1⁄2 years to ensure an orderly transition to lower GWP blowing agents for the walk

- in coo ler market.
Rigid Insulating Foams Conversion Example 2: HVAC and Residential Entry Door Applications
The expertise developed while formulating HFO solutions for Walk

- in cooler applications should help expedite the development of entry door and HVAC appli cations. The 18 month timeframe outlined for walk

in cooler applications should be sufficient to develop technology for entry doors and HVAC. Coupled with limited agency testing and time to commercialize these systems, we would estimate HVAC and entry do or



### 14applications could be converted to HFO solutions by the middle of 2017 , assuming we could begin formulation work today

. Rigid Insul ating Foams Conversion Example 3 : Garage Door Applications
As with entry door product development, we will leverage techn ology developed for walk

- in coolers to accelerate the work on garage doors. Again, we expect the same 18 months of product development to be sufficient to have garage door products developed. Garage doors require UL approval which we expect to add as muc h as 18 months to the entire effort. With commercialization efforts to take approximately 6 months, we would expect that garage door applications could be converted by the middle of 2018.
Rigid Insul ating Foams Conversion Example 4 : Refrigerated Transpo rt
Refrigerated transportation trailers or “reefers” will benefit from general development efforts with new low GWP blowing agents. The time frame is expected to follow closely with what we expect for garage door applications. The re is little agency appr oval work to be done but long

- term over

- the

- road durability testing is expected to take the place of agency testing on the timeline. Commercialization time will be similar and a mid

- 2018 date would be reasonable for customer conversion to be complete , ass uming we could begin formulation work today.


### Rigid Insulating Foams Conversion Example 5 : Marine Floatation
We will leverage experience developing systems for the other applications as a basis for an HFO based system for marine flotation. We expect the sa me 12 months of product development time. Marine flotation foams require Coast Guard approval to confirm buoyancy and chemical resistance to materials that are used in the boating industry. T he process is often iterative, requiring processing adjustments and retests to obtain approval. We expect this approval process to take approximately 12 months. A lthough there is an approved water blown system available today, processing at the customers facility is difficult leading to increased product defects and/o r costly/time intensive design changes.
Current experience working with HFO containing systems has shown an incompatibility with several common polymers used in the construction of domestic and commercial appliances. This incompatibility results in incre ased production scrap and field failures due to cracking or wall thickness thinning of the polymer. The potential exists for similar incompatibility issues with marine stringers and various other critical components currently made from polymer materials. Following the development and Coast Guard approval of a new HFO system, each customer would need to conduct durability testing and possible specify alternative materials of construction to ensure performance and safety. We expect this phase of conversion to take a minimum of 12 months.



### 15Due to the large number of customers in this segment commercial conversion will require a great deal of resources and is expected to take a minimum of 18 months. It is expected that this can be accomplished by the middle of 2019.
Rigid Insulating Foams Conversion Example 6 : Domestic Refrigeration
Some manufacturers in this industry have been proactive in their development of next generation products that use either cyclopentane or HFO blowing agents. However there are man y manufacturers that have yet to begin the process. BASF has commercially available systems utilizing cyclopentane or HFO blowing agents. History tells us that approximately 6 months will be required to adapt these products to meet the individual needs o f each customer.
Current experience working with HFO containing systems has shown an incompatibility with several common polymers used in the construction of domestic refrigeration cabinets. This incompatibility results in increased production scrap and field failures due to cracking or wall thickness thinning of the polymer. Domestic appliance producers will need to invest time and resources to investigate the compatibility of the foam system and the polymers with which it will come in contact in each of their models. This will require durability and field testing and possible specification of new materials of construction. Because this is a known issue in this industry we expect this to take a minimum of 6 months to complete.
Alternatively, conversio n to cyclopentane or another flammable blowing agent requires investment in intrinsically safe equipment. This conversion will take a minimum of 18 months to engineer, procure and install.
Following selection of a foam system, domestic refrigeration produ cers will also need to confirm compliance of each model with new Federal Energy Efficiency Regulations. We expect this step to take a minimum of 6 months. From this point an additional 12 months will be required for full conversion at each customers prod uction facility.
Due to the head start on the formulation work for this industry, it is expected that conversion can be accomplished as early as the middle of 2017.
Rigid Insulating Foams Conversion Example 7 : Commercial Refrigeration
BASF has commercially available systems utilizing cyclopentane or HFO blowing agents. History tells us that approximately 6 months will be required to adapt these products to meet the individual needs of each customer. Conversion to cyclopentane or another flammable blowing agent requires investment in intrinsically safe equipment. This conversion will take a minimum of 18 months to engineer, procure and install. As this industry is also facing several new regulations related to Department of Energy regulations and refriger ant changes, the resources will likely be limited to also support a parallel blowing agent change in


### 16the polyurethane foam system. Completion of the initial product development will be followed by UL and FM qualification as outlined above. A product deve lopment effort lasting 6 months coupled with an agency approval process of approximately 36 months will mean that products will first be ready for commercial launch in 42 months. Commercial launch will require an additional 12 months. We expect that this market can be converted by the middle of 2019.
Flexible Foams Conversion Example 8 : Integral Skin
This product requires an auxiliary blowing agent to produce a necessary skin on the surface of the flexible foam. As the end products are in direct contact with people the system components must be chosen carefully. Development work recently began utilizing HFO blowing agents with very limited success to date. A minimum of 2 years will be necessary to formulate a system to meet the requirements for this ind ustry. As there a limited number of customers in this area, we expect commercialization will take 6 months. It is expected that conversion can be accomplished as early as the middle of 2017.
Rigid Insul ating Foams Conversion Example 9 : Insulated Metal P anels (IMP)
Some continuous insulated metal panel producers are already utilizing cyclopentane as a low GWP blowing agent. Those that are not will be required to use an HFO product ’ if they prefer a non

- flammable solution , or would otherwise need to make an investment in intrinsically safe equipment to enable the use of cyclopentane, HFC 152a or another flammable material. We understand HFO blend formulations are being developed and those efforts are expected to fall into the 18 month development horizon that we have discussed and will also fall into the queue for agency approvals. An HFO solution for IMP’s could be expected in 5 years and a 2020 timeframe for conversion would be proposed. Conversion to a flammable blowing agent will require equipment up grades that are expected to take at least 18 months to engineer, procure and install. Commercial launch would be expected to take at least 6 months and then another 2 years for FMGlobal, Miami

- Dade and other building code

- required approvals. BASF would s upport four years for implementation resulting i n an early 2019 conversion date , assuming we could begin formulation work today.

Cost Impacts

While BASF understands that Section 612 of the Clean Air Act may limit the extent to which EPA may consider cost i mpacts, those impacts should be understood. Conversion of current foamed products to new blowing agent derived systems will increase costs throughout the industry. HFO blowing agents are expected to cost as much as three times as much as the HFC products that they are replacing. This cost will be passed along from the polyurethane suppliers to the converters and ultimately to the consumer. The cost of the foam could increase as much as 30

– 40%.
Conversion to hydrocarbon blowing agents could mitigate increases in the cost of foam systems but require significant capital investment to use safely . Many foam producing plants are not rated to handle flammable


### 17blowing agents. The cost of capital improvements to enable the processing of flammables will vary widely depending upon the current state of the equipment, size and layout of the plant, air emissions permitting status etc. We estimate these costs from a few hundred thousand dollars to >$1M (per plant manufacturing) depending upon the factors mentione d here.
A third component of the cost equation involves the foam suppliers. Significant research and development costs will be incurred by the chemical suppliers like BASF . These costs will be manifested in salaries, materials for development along with trial and agency testing fees. BASF estimates this conversion related cost to be at least several million dollars over and above our current rate of investment . This estimate includes the cost to develop, test and implement new technologies at each of ou r affected customers.
The greatest cost impact will be on the Walk

- in

- cooler manufacturers and Insula ted Metal Panels producers. T he qualification efforts at these customers alone will cost BASF several million dollars to support

. This estimate does no t take into account the cost incurred by our customers to run trials and approve new products. Our customer base ranges from small, family owned businesses to large corporate entities. The small businesses will be most adversely affected as our limited r esources will be required to support our largest customers first.

4. The Statutory Interest in Applying the New Rule Immediately
Finally, the fourth part of the four

- part test to judge the appropriateness of agency grandfathering requires an examination of the statutory interest in applying the new rule immediately, without grandfathering periods. Section 612 of the Clean Air Act is the “ Safe Alternatives Policy ” implemented by EPA under its Significant New Alternatives Policy program. 15 Section 612 is orga nized to address: “(a) Policy ” ; “ (b) Reviews and reports ” (“recommending Federal research programs and other activities to assist in identifying alternatives ... and in achieving a transition to such alternatives”); “ (c) Alternatives for class I or II substa nces ” (“unlawful to replace any class I or class II substance with any substitute substance which the Administrator determines may present adverse effects to human health or the environment, where the Administrator has identified an alternative to such rep lacement that

— (1) reduces the overall risk to human health and the environment; and (2) is currently or potentially available”); (d) Right to petition ; and (e) Studies and notification ” (requiring submission of unpublished health and safety studies and S NAP notifications).
EPA acknowledges in the preamble to the rulemaking that, as to foam blowing end

- uses, it has not received a petition it has found to be complete

. 16 As such, the only other statutory interest that might be in favor of applying the new r ule immediately would be under the “ Policy ” subsection of the Statute , which provides:
§ 7671k. Safe alternatives policy (a) Policy

15 Section 612 of the Clean Air Act ; Title 42 USC § 7671k

- Safe alternatives policy 16 79 Fed Reg. 46134 (August 6, 2014) 

### 18To the maximum extent practicable, class I and class II substances shall be replaced by chemicals, product substitutes, or alternative manufacturing processes that reduce overall risks to human health and the environment. 17
When presented with similar circumstances in the past, EPA has never required polyurethane foam producers to convert to acceptable alternates without benefi t of a grandfather period which, while not dispositive, suggests that EPA doesn’t view the statutory interest to require immediate conversion. More importantly, in its proposed rulemaking, EPA based its decision to find HWCs unacceptable on their “high GWP s as compared with other available or potentially available substitutes in those end

– uses and pose significantly greater risk overall to human health and the environment .” 18

While EPA found all remaining issues in the three petitions incomplete with respect to the other end

uses, EPA has independently acquired sufficient information to address certain other requests made by the petitioners regarding listing high GWP HFCs as unacceptable. Specifically, based on our review of the aerosols, foams, and air condi tioning and refrigeration sectors, we are proposing to revise the listings for a number of substitutes from acceptable to acceptable subject to use conditions, or unacceptable. (See sections V.A., V.C., and V.D. of today’s notice.) These substitutes have h igh GWPs as compared with other available or potentially available substitutes in those end

– uses and pose significantly greater risk overall to human health and the environment. EPA considers the intersection between the specific HFC or HFC blend and the p articular end

- use. This action does not propose that any specific HFC be unacceptable across all sectors and end

- uses. EPA is also not proposing that, for any specific sector, the only acceptable substitutes are HFC

- free. EPA recognizes that both fluorina ted (e.g., HFCs, HFOs and non

- fluorinated (e.g., HCs, CO2) substitutes are potentially acceptable. Instead, consistent with SNAP’s history and Clean Air Act (CAA) Section 612, EPA is proposing these modifications, and will consider future modifications ba sed on the substitutes being considered, the SNAP criteria for evaluation, and the current suite of other available and potentially available substitutes in specific sectors and end

- uses. While Section 612 of the Clean Air Act does require an assessment o f risk, it doesn’t explain how that assessment should be done. Whatever that assessment should involve, it’s possible that Congress did not intend Global Warming Potential (GWP) to be part of that assessment. While the balance of Title 7, Subchapter VI

— Str atospheric Ozone Protection does speak to GWP, Section 602 raises some question about the extent to which GWP might be considered in regulating Class II substances:

§ 7671a. Listing of class I and class II substances (e) Ozone

- depletion and global warmin g potential
Simultaneously with publication of the lists under this section and simultaneously with any addition to either of such lists, the Administrator shall assign to each listed substance a numerical value representing the substance’s ozone

- depletio n potential. In addition, the Administrator shall publish the

17 Section 612 of the Clean Air Act; Title 42 USC § 7671k (a)

- Policy 18 79 Fed Reg. 46135 (August 6, 2014) 

### 19chlorine and bromine loading potential and the atmospheric lifetime of each listed substance. One year after November 15, 1990 (one year after the addition of a substance to either of such list s in the case of a substance added after the publication of the initial lists of such substances), and after notice and opportunity for public comment, the Administrator shall publish the global warming potential of each listed substance. The preceding sen tence shall not be construed to be the basis of any additional regulation under this chapter. 19
As a result, it is clear that there is not a compelling statutory interest in applying the new rule immediately, without grandfathering periods , and so EPA shoul d adopt the grandfathering periods outlined herein.
Summary of BASF’s Alternative Proposal : Based upon the information presented above and what we have learned from our industry partners , BASF believes, given the nature of the transition that would resul t should the Proposed Rule be promulgated, that a

“ grandfather ing period ” of up to three years (beyond January 1, 2017) for existing uses of HFC

– 134a, HFC

– 245fa, HFC

– 365mfc and blends thereof , as outlined below, is justified and necessary 

### , assuming a suffi cient supply of each required blowing agent is readily available to support industry

- wide polyurethane foam conversion efforts by January 1, 2016:

• Walk

- in cooler panel foams

– not before January 1, 2020;

• Continuously produced insulated metal panels

-- not b efore 2019;

• Marine Floatation

– not before July 1, 2019

• Commercial Refrigeration

– not before July 1, 2019

• Garage door applications and refrigerated transport

-- not before July 1, 2018;

• Domestic Refrigeration

– not before July 1, 2017

• Integral Skin

– not before July 1, 2017

• HVAC panels and residential entry door applications

-- not before July 1, 2017.
A chart showing the phase

- out periods is provided on the next page. Such an approach would support a diligent , informed transition from HFC blowing agents and help avoid the types of problems that the industry experienced during the conversion from CFC’s to HCFCs

– which now have a far greater likelihood under EPA’s currently proposed transition away from HFCs

-- while fully complying with the statute, regul ations and EPA’s Significant New Alternatives Policy program.

Attached :

EPA

- HQ

- OAR

- 2004

- 0507

- 0014.pdf, available at http://www.regulations.gov

. BASF Corporation’s Proposed HFC Conversion Timeline

19 Section 602 of the Clean Air Act; Title 7 USC § 7671a. “ Listing of class I and class II substances ”; emphasis added. 

### 20BASF Corpor ation’s Proposed HFC Conversion Timeline

Proposed Conversion Timeline

Walk-in Coolers Product Development
Agency Approval
Customer Approval
HVAC and Entry Doors Product Development
Customer Approval
Garage Doors Product Development
Agency Approval Customer Approval
Refrigerated Transport Product Development
Durability Testing
Customer Approval
Product Development
Agency Approval Customer Approval
Capital Equipment Upgrade
Agency Approval Customer Approval

Marine Flotation Product Development
Agency Approval
Durability Testing
Customer Approval Domestic Refrigeration Product Dev. Durability Testing Energy Eff. Testing
Customer Approval Commercial Refrigeration Product Dev.
Agency Approval
Customer Approval
Integral Skin Product Development Customer Approval 1-Jan-21

Insulated Metal Panels HFO Solution

Insulated Metal Panels Flammable Solution 1-Jan-15 1-Jan-16 1-Jan-17 1-Jan-18 1-Jan-19 1-Jan-20



### 21