Hon eywell International Inc.

1 01 Columbia Road Morristown, NJ 07962

- 2245 Phone: ( 973) 455

- 6294
Email: ste v en.bernhardt@honeywell.com

September 6, 2011

Docket ID No. EPA

- HQ

- OAR

- 2010

- 1040
Air and Radiation Docket and Information Center
U.S. Envi ronmental Protection Agency
Mail Code 6102T 1200 Pennsylvania Ave., NW Washington, DC 20460

R e : Comments from Honeywell International on the Interim Final Rule “Protection of the Stratospheric Ozone: Adjustments to the Allowance System for Controlling

HCF C Production, Import, and Export.” 76 Fed. Reg. 47,451 (August 5, 2011) (“Interim Rule”)

.

To Whom It May Concern:

This letter provides comments from Honeywell International, Inc. (“Honeywell”) to the Environmental Protection Agency’s Interim Final Rule “Protection of the Stratospheric Ozone: Adjustments to the Allowance System for Controlling HCFC Production, Import, and Export.” 76 Fed. Reg. 47,451 (August 5, 2011) (“Interim Rule”) that adjusts the allowance system for hydrochlorofluorocarbons (“HCFC”) during the calendar year 2011. We appreciate the opportunity to provide input into EPA’s process to transition from ozone depleting products to more environmentally

- beneficial alternatives.

Honeywell is a diversified technology and manufacturing compan y, serving customers worldwide through multiple operating businesses. Honeywell’s Fluorine Products business is a technology leader and a U.S.

- based producer of fluorocarbons and other fluorine

- based materials. Honeywell has been at the forefront of the industry’s efforts to develop alternatives

to ozone

- depleting products. Our research and development efforts have produced commercially
viable non

- ozone

- depleting blowing agents for polyurethane foam applications and for refrigerants used in air conditio ning and stationary refrigeration applications. More recently, Honeywell has led the fluorocarbon industry in discovering and commercially developing new low global

- warming refrigerants and blowing agents that address the challenges of climate change.

Honeywell produces HCFCs at its Baton Rouge, Louisiana facility, which is a major local employer in that area. The Baton Rouge facility’s primary product is HCFC

- 22, one of the HCFCs regulated under this Interim Rule.Honeywell would like to take this opportunity to respond to the five issues presented in the Interim Rule. First, Honeywell’s due process rights and the Clean Air Act (CAA) would be violated by amending Arkema’s and Solvay’s baselines to account for their 2008 inter

- pollutant transfers, a s the Interim Rule does. Second, principles of administrative law require that EPA not extend the Interim Rule beyond 2011. Third, based on publicly available consumption data showing decreased demand for HCFC

- 22, we encourage EPA to reduce the number of HCFC

- 22 consumption allowances for calendar years 2012

- 2014. Fourth, EPA has the authority to allocate different percentages of baseline for calendar

- year production and consumption allowances. Fifth, the D.C. Circuit’s decision in Arkema v. EPA does no t require any further rulemaking to
address the 2010 allowance allocations.

As an initial matter , t he Arkema v. EPA decision 1 did not address the validity of the 2008

inter

- pollutant transfers by Arkema and Solvay. Instead, the court assumed that these transfers were valid in connection with the challenge to the 2009 allocation rule. 2 This decision, however, does not require EPA to recognize the validity of those transfers. We believe that EPA can and should grant the pending petition for reconsiderat ion of these transfers filed jointly by Honeywell and DuPont. If EPA determines that the transfers were improper, EPA’s justification for the
Interim Rule would be moot.

We also believe that EPA should not extend the Interim Rule beyond 2011. The validi ty of EPA’s use of the “good cause” exemption to the CAA and the Administrative Procedure Act to promulgate a rule without notice and comment is limited to the 2011 control period. Honeywell believes EPA is required to undergo notice and comment rulemakin g to promulgate an appropriate allocation scheme for 2012 and beyond.

With respect to future consumption allowances

, EPA’s data show that only 86% of the

HCFC

- 22 consumption allowances were actually used in 2010 and that 2010 reclamation was only about 3 0% of what is projected to be required in 2015. Clearly, the total HCFC

- 22 consumption allowances provided for 2010 in the 2009 allocation rule were greater than the market demand. We believe EPA should consider larger reductions to encourage a more rapi d
movement toward non

- ozone depleting alternatives, to decrease inventory stockpiles, and to encourage higher rates of recovery and reclamation of HCFC

- 22.

Honeywell also believes that an increase of production allowances would result in more U.S. produ ction for both domestic use and for export. Honeywell currently produces for both domestic use and for export. To the extent production allowances continue to be held by entities that do not produce in the US and/or production allowances are further decre ased, U.S. producers like Honeywell will be disadvantaged. Without sufficient allowances, Honeywell may not be able to compete with other global producers to serve demand for HCFC

- 22 in Article V

countries

.

Finally, on the issue of 2010 allowances, Ho neywell does not support any effort to adjust allowances in future control periods to address allocations made for the 2010 control period. Nothing in the DC Circuit’s decision requires EPA to take such action. Moreover, any

1 618 F.3d 1 (D.C. Circuit 2010).

2 74 Fed. Reg. 66,412 (December 15, 2009).arguments by Arkema and Solvay that they suffered financial harm in 2010 is belied by the EPA’s data showing that nearly 15% of all consumption allowances were unused. Taking the 2010 data into account, the notion that Arkema and Solvay suffered financial harm is purely speculative. Adjusting future periods by decreasing the allowances of companies like Honeywell is far more likely to cause financial harm to companies like Honeywell and will only serve to give Arkema and Solvay a significant windfall in those future periods.

We th ank you for the opportunity to comment on this important regulatory initiative and appreciate your consideration of our points. If there are any questions, please contact Steven H.

Bernhardt at steven. bernhardt@honeywell.com or 1 973 455

- 6294.

Sincerely,

Steven H. Bernhardt, PhD Global Director Regulatory Affairs Honeywell Specialty Materials