After debuting in the Senate last year, the American Innovation & Manufacturing (AIM) Act began its parallel journey through the House of Representatives just after the new year. H.R. 5544 received its first public debate in that chamber on January 14, courtesy of the House Committee on Energy & Commerce’s two-part, three-hour hearing in the Rayburn House Office Building. It was more interesting than it sounds.

As previously reported, the AIM Act enjoys an increasingly rare level of support across party lines in the 116^th Congress and across traditional industry/environmentalist lines as well. The Energy & Commerce hearing made clear that despite such backing, some House Republicans will challenge the bill on a number of levels.

Efforts to clarify or improve language were joined in this hearing by more fundamental attacks on the need for a federal HFC phasedown plan at all.
In particular, the committee’s minority had clearly tabbed Rep. Markwayne Mullin (R-Okla.) — one of three congressmen to have HVAC contracting experience — to serve as minority spokesperson. Members frequently yielded their own remaining time over to Mullin, who pursued a series of critiques that emphasized his familiarity with HVAC and concern for consumers while varying in accuracy and civility.

IN THE ROOM

In his opening statement, Rep. John Shimkus (R-Ill.) listed his concerns, including whether the bill was necessary, potential vulnerability to later court challenge, and the lack of federal preemption language in the AIM Act. Preemption (or its absence) would emerge from the hearing as the primary candidate to become an Achilles’ heel for the bill’s intent, should it take effect.

A preemption provision would prevent individual states from going beyond the AIM Act’s parameters and setting more aggressive phasedown timeframes or scopes of restriction on HFC use. Federal preemption basically establishes the federal phasedown as an “upper limit” of HFC action through all 50 states.

In fact, one of the core arguments by many in the HVAC industry for a federal HFC phasedown plan at all is that it would avoid an unwieldy and needlessly expensive state-by-state patchwork of HFC regulation. However, neither the Senate nor the House version contains federal preemption provisions at this time.

Shimkus asked the later panel, “Wouldn’t it be more orderly, especially in this day and age,” to prevent states from creating their own differing requirements?

Lieberman replied that if certainty is the goal, the bill certainly has some flaws.

“If California can go in its own direction, or other states, that makes it a lot more difficult. One set of standards should be enough.

“If we don’t want the states to go their own ways,” Lieberman added, “we should put it in writing.”

Rep. Greg Walden, a Republican from Oregon and the committee’s ranking member, picked the issue back up later and put it to each member of the panel.

“Do you think states won’t try to move beyond [AIM Act provisions] on their own?”

“Frankly, states have other things and work to do,” Bedard said. “What I can tell you with certainty is that without a framework, they will.”

Pressed for a yes/no answer to the Congressman’s question, Bedard said he would not oppose a preemption provision.

The NRDC’s Doniger did oppose preemption language, reflecting the most liberal wing of AIM Act supporters. He did point to another regulatory case where preemption had not been included but no state alternatives had arisen “because strong federal programs let states do other things.”

AHRI’s Galyen refused Walden’s request for a one-word answer more than once, emphasizing that AHRI supports a strong national framework.
That concluded the day’s attention to preemption. Opportunities remain in the Senate and the House, and then hypothetically in any reconciliation process, for further debate and movement on the topic.

LIFE IN THE UNEXPECTEDLY FAST LANE

Another AIM Act component that some saw as a potential threat to the goal of an orderly phasedown is its “acceleration” language, which would leave the door open to a faster timeframe in certain circumstances. For instance, if new alternatives came to market after the fact that suggested a phasedown could occur more quickly with no adverse effects, the EPA would have latitude to accept a request to make adjustments.

Lieberman said that even if the EPA declined such a request to speed things up, other interests would still be free to litigate for faster implementation. So, he observed, the bill as written does not eliminate uncertainty as much as some might like.

Acceleration wording seemed to be a minor cousin to the preemption issue for the industry panel. It is considered a feature or a bug, depending on which person you ask, but the witness panel seemed comfortable living with it as part of building consensus for the greater goal.

Q&A&Q AGAIN

Between his own allotment and time yielded to him by colleagues, Rep. Mullin had more speaking time than anyone else in the hearing.

He began his first question period by skipping a question in favor of addressing the claim that the AIM Act would not require consumers to go out and replace their existing systems. Mullin went step by step through what happens when a technician makes a drop-in of 421a in a unit that currently contains R-22. The capacity is slashed, compressor problems develop, and the homeowner would need to spend a few to several thousand dollars to replace the equipment.

The hearing’s testimony confirmed that putting the wrong refrigerant in a unit will indeed lead to problems. However, the Congressman framed this example as the expected outcome, rather than an incident resulting from an uninformed and/or untrained technician’s mistake.

Mullin later asked Newberg, “What is the reason for phasing out from HFCs to A2L, if it’s not depleting the ozone?”

Newberg replied that HFCs are, in fact, potent greenhouse gases.

After other speakers, Mullin again asked if there is EPA concern that HFCs are “hurting the environment.” Newberg replied that the EPA decided HFCs were not exempt from venting requirements.

HEATED WORDS ON FLAMMABILITY

Addressing the second panel, Mullin started with a question that led into more conversation.

“Doesn’t this bill represent job security?” he asked of the panel, his implication being that the bill and related concern is basically intended to boost manufacturer sales at the expense of the consumer.

“We certainly plan to continue making equipment to heat and cool people’s homes,” Bedard affirmed drily.

But when 410a is phased out, Mullin said, what refrigerant will replace that?

Lieberman explained that there is, in fact, no clear frontrunner. He described different companies going in different directions as a problem. Bedard confirmed for the room that certain equipment is designed for certain refrigerants.

Mullin pivoted to A2L refrigerants’ categorization as mildly flammable.

“Flammability risks can largely be engineered around,” Lieberman told him, noting that it is more of a problem for some equipment types than others.

Lieberman’s group pointed out that the A2L switch is especially relevant for retail and that risk reduction costs money, citing insurance, lease requirements, and building code issues that the presence of A2Ls may raise.

Shortly thereafter, as Rep. Mullin attacked the idea of A2Ls in residential systems by referencing existing scenarios such as an explosion because a homeowner decided to meddle with a water heater’s pressure relief valve or cap off the ventilation.

“The installers are trained, but the homeowner isn’t,” Mullin continued. “If a house explodes, who’s responsible for that life? I’m an installer. Believe me, safety is first and foremost. If you know anything about consumers, if we’re talking mildly flammable, it’s flammable.”

The congressman did not address what the technical differences between “mildly flammable” and “flammable” entail.

Toward the day’s end, Mullin concluded that he expects that the current refrigerants would get priced out of the market, thereby forcing consumers to prematurely replace equipment after all. He cited the still widespread use of R-22 units as a reason to not phase down HFC-based equipment.

He also asserted that "the EPA already said that 410a doesn't hurt the ozone," although NASA has found HFCs to have a low but measurable impact on the ozone layer. More importantly, HFCs are strong greenhouse gases with a high global warming potential, as Newberg observed.

GLOBAL CONTEXT

For the remainder of the hearing, multiple people reiterated that the AIM Act is drafted to provide ample HFC refrigerant supply for existing units to serve homeowners for the full duration of their useful life. Witnesses pointed to the continued availability of previously phased-out refrigerants for service needs, exactly as intended, although Lieberman questioned whether the AIM Act could accomplish the same.

AHRI’s Galyen reiterated, along with Bedard, that safety is very important to the industry, reminding the committee that it has dealt well with appliances like gas furnaces for a long time. Galyen also emphasized that a failure to establish an organized national strategy for handling HFCs could hit small- to medium-sized HVAC-related businesses especially hard.
Asked about supply chain ramifications, the Alliance for Responsible Atmospheric Policy’s Bedard namechecked the associations at different points in the chain who support the bill: AHRI, ACCA, HARDI, SMACNA.

Bedard pointed to language in the bill that echoes the structure for previous phasedowns. The familiar approach would help the industry to do this as smoothly as possible for all involved, “as we’ve done twice in the past.”
The topic of U.S. industry leadership also came up repeatedly. Discussion centered on whether (and how) a failure to act on HFCs would lead to loss of American jobs and prominence in this field. Lieberman challenged the job figures of the study commonly cited by AIM Act supporters, citing current and likely outsourcing by some HVAC manufacturers. The proposition that China and other countries would step up in the absence of a formal U.S. plan did not encounter opposition.
Related, while “Do you believe that climate change is real or that the U.S. should take action to fight it?” was one unspoken fault line dividing some participants in this hearing, no one denied the current global context surrounding HFCs and the AIM Act.
“This transition is underway,” Bedard declared. “It’s happening. The only question is under what terms, and are we going to accrue the benefits. We’re asking for your help [via a federal plan] to help the supply chain and the consumer.”