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October 30, 2013 

Ms. Drusilla Hufford 

Director, Stratospheric Protection Division 

Office of Atmospheric Programs 

U.S. Environmental Protection Agency 

Mail Code 6201J 

1200 Pennsylvania Ave., NW 

Washington, DC 20460 

Via email 

Dear Ms. Hufford: 

The Natural Resources Defense Council appreciates the Environmental 

Protection Agency’s continued leadership in implementing the Montreal Protocol on 

Substances that Deplete the Ozone Layer. However, we write to express our concern 

that EPA has not sufficiently reduced hydrochlorofluorocarbon (HCFC) allowances 

and urge it to eliminate the current oversupply in its next rule. EPA missed an 

opportunity to significantly reduce HCFC allowances in the final rule issued in April 

3, 2013.1 The continuing drop in the market price for HCFCs demonstrates that EPA 

has been authorizing too many HCFCs. In its next allowance rule, EPA must act 

decisively to eliminate the oversupply. We recommend that in the proposed rule 

EPA seek comment on authorization of no new allowances in light of the excess 

supply currently in the market. 

In response to EPA’s January 4, 2012 proposed rule, NRDC submitted 

comments recommending that EPA reduce the existing allowance schedule by at 

least the maximum percentages proposed by EPA and indicated our support for 

reducing allocations even more rapidly. Our comments were based on two key 

premises. First, acceleration of the reduction schedule is necessary to protect human 

health and the environment. Second, accelerating the phase-out of HCFC-22 is 

necessary to transition the market to new alternatives and substitutes, to encourage 

compliance with laws and regulations already in place to prevent refrigerant venting, 

 

1 Protection of Stratospheric Ozone: Adjustment to the Allowance System for Controlling HCFC 

Production, Import, and Export (Final Rule). 78 Fed. Reg. 20004 (April 3, 2013). 

 1152 15th Street, N.W. Suite 300 NEW YORK * SAN FRANCISCO * LOS ANGELES * CHICAGO * BEIJING 

 www.nrdc.org Washington, D.C. 20005-6166 

 TEL 202 289-6868 

 FAX 202 289-1060 

NATURAL RESOURCES DEFENSE COUNCIL
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and to promote the reclamation and reuse of used HCFC-22. EPA’s decision not to 

accelerate the reduction allocations to the maximum percentages has contributed to 

an over-supply of virgin HCFC-22. The continued decline in HCFC prices means 

that there is less incentive to recycle HCFCs, which means that more HCFCs are 

being vented to the atmosphere, and has also slowed the transition to safer 

alternatives. 

HCFCs are both ozone-depleting substances and greenhouse gases. The 1990 

amendment to the Montreal Protocol identified them as “transitional” substitutes for 

chlorofluorocarbons (CFCs) and other ozone-depleting substances. The history of 

both domestic and international efforts to reduce ozone-depleting substances has 

repeatedly demonstrated that phase-out schedules can and should be accelerated 

based on new scientific, technical, and economic information. The HCFC phase-out 

schedule has been accelerated several times, most recently in the 2007 amendments to 

the Montreal Protocol in response to the unanticipated rapid increase of HCFC 

emissions and their harmful effects on ozone and the climate. 

Market data demonstrate that there is currently a very large oversupply of 

HCFC-22 relative to demand, resulting in very low prices. This oversupply was 

identified in numerous comments submitted to EPA on the most recent proposed 

rule (Letter from DuPont Chemicals dated February 3, 2012 (“[W]e believe the 

market demand for HCFC-22 is significantly lower than estimated...[leading] us to 

conclude that the maximum proposed reductions in allocations can be achieved 

without causing a significant disruption in the market place.”) p. 2; letter from 

Certified Refrigerant Services, Inc., “If the EPA wants a strong organization (the 

refrigerant reclaiming industry) to recover and reuse R-22 during their ‘phase-out’, 

they must radically reduce allocation to import and produce.”) p. 2; letter from John 

Haynes, owner, Express Recovery Inc., (“If the EPA desires an increase in amount of 

refrigerant reclaimed it must decrease the amount of virgin material available in the 

market place,”) p.1). 

Since EPA’s rule was released, the price of HCFC-22 has steadily decreased, 

reflecting that fact that EPA’s rule authorized an excess of allowances.2 We 

understand that wholesale HCFC-22 prices at the start of 2013 were approximately 

$10-11, rose to $14-15 in March, and, following the release of EPA’s last rule, fell to 

today’s price of $7. 

This demonstrates that allocations have not been stringent enough to exert 

pressure on the market. The oversupply and low price is having several negative 

effects: 

 

2 See http://www.achrnews.com/articles/print/124347-hvacr-industry-wary-of-r-22-surplus. 
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(1) It is hurting the development of industrial capacity to reclaim and reuse 

HCFCs. 

(2) It is encouraging higher HCFC leakage by discouraging the adoption of leak 

prevention practices. 

(3) It is hurting the development and adoption of alternatives and substitutes to 

HCFCs. 

The excess emissions that result underscore that accelerating the pace of 

reductions is “necessary” to protect health and the environment. 

In addition to urging EPA to propose no new allocations when it next proposes 

allocations, we are also submitting an information request. We respectfully request all 

EPA’s data on the quantity of HCFC-22 stockpiles in the United States. If necessary, 

we are willing to submit a request under the Freedom of Information Act, although 

we hope that this letter will suffice. 

Thank you for considering our comments. Should you have any questions for 

require further explanation on any matter contained within this letter, please contact 

Benjamin Longstreth at blongstreth@nrdc.org or 202-513-6256. 

Sincerely, 

Benjamin Longstreth 

Natural Resources Defense Council