Even though it was handed a decisive defeat by the pen of the U.S. U.S. Court of Appeals for the District of Columbia Circuit in June 2023, the Environmental Protection Agency has laid to rest its quest to ban non-refillable refrigerant cylinders, evoking some additional celebration from key HVAC industry players.

Earlier this month, the EPA formally removed its proposed provisions, which would have banned non-refillable cylinders, and also enacted a QR code cylinder tracking requirement, from the Code of Federal Regulations.

The ruling, and subsequent retraction, stemmed from a court battle between the EPA and HVAC industry leaders ACCA, HARDI, and PHCC, along with cylinder manufacturer Worthington Industries.

“While removing the non-refillable cylinder ban from the Code of Federal Regulations is a win for HARDI and the HVACR industry, we are still waiting for the final HFC management and reclaim rule to be published. In the EPA’s proposed rule released in 2023, the EPA reintroduced the QR code cylinder tracking requirement, including the initial compliance date of January 1, 2025,” HARDI stated in a press release posted to its blog, Sept. 18. “HARDI has undertaken a significant effort since May 2021 to combat these proposed regulations, which called for banning non-refillable cylinders and tracking all cylinders through the supply chain using QR codes.”

Over at ACCA, they are also celebrating this victory that has culminated from a long and hard-fought legal battle.

“ACCA is pleased to see EPA has formally removed its refillable cylinder ban and cylinder tracking requirements from the Code of Federal Regulations,” Barton James, ACCA president and CEO. “While the recent news is a formality, it makes the victory over these burdensome regulations official. If ACCA and our allies had not put up a fight, contractors and the broader HVACR industry would have faced significant, unprecedented, and unnecessary challenges. We sincerely hope the EPA refrains from enacting similarly harmful regulations under future AIM Act rulemaking. As always, ACCA will continue to fight for the interests of contractors.”

Following the initial win in District Court, Alex Ayers, vice president of Government Affairs for HARDI, noted in a blog that the EPA could petition for a rehearing or appeal the decision to the Supreme Court, “but we believe it to be unlikely.”

It appears now that the matter has been laid to rest.

MORE BACKGROUND INFORMATION

According to previous reporting from ACHR NEWS, the American Innovation and Manufacturing (AIM) Act of 2020, signed into law by President Trump, mandated the Environmental Protection Agency (EPA) reduce production and consumption of HFCs by 85% over the next 15 years. The intended goal of the law is to mitigate the effects of climate change.

As part of this legislation, the EPA was to phasedown production and consumption of commonly used HFC refrigerants like R-410A and R-32, which have a high GWP. Under this broader umbrella was also a rule that would ban disposable or non-refillable cylinders, which the EPA said would curb illegal HFC trafficking and imports (their logic being that refillable cylinders are easier to track), but this was a point of particular concern for contractors as replacing an entire fleet of cylinders will not be an easy or cheap task.

ACCA, HARDI, and PHCC opposed the outright ban, but that didn’t completely dissuade the EPA.

“Originally, the EPA proposed the date of January 1, 2023, for the termination of imports and placement of HFCs into new disposable cylinders and January 1, 2025, for an outright ban on their sale,” Chris Czarnecki wrote in a guest column for ACHR NEWS in November 2021. “Based on feedback from ACCA and other stakeholders, EPA has pushed those dates to January 1, 2025, and January 1, 2027, respectively. While it is not what ACCA asked or hoped for, an additional two years does buy the industry more time to prepare and will hopefully ward off some of the negative impacts of the ban.”

Fast forward to January 2022, more critics from the industry were raising concerns that the disposable refrigerant cylinder ban would not only increase costs, but also pose safety risks for technicians.

Cylinder manufacturing giant, Worthington Industries, also began publicly fighting back.

“EPA erroneously believed that banning the non-refillable cylinder would stop illegal HFCs from crossing our borders. History has taught us that bans do not work,” said Wayne Powers, director of refrigerants at Worthington Industries, the only cylinder manufacturer in the U.S. “The EU put a non-refillable cylinder ban in place in 2007, which has not stopped the influx of illegal gas. This only caused illegal importers to use other containers to move HFCs across the border, including refillable cylinders. EPA believes that by banning the non-refillable cylinder, it will be easier for Customs and Border Patrol to identify illegal gas in these containers. The fact is the container is not the problem — this is an enforcement issue.”

From an industry standpoint, nearly all 30-pound refrigerant cylinders sold in the U.S. in 2020 were non-refillable.

“Today’s standard 30-pound refillable cylinder weighs approximately 21 pounds. Compare that with today’s non-refillable at 5 pounds,” said Powers. “Technicians will be putting much more physical stress on their bodies, increasing the likelihood of injury as they move these heavier cylinders around job sites and up ladders.”

As the reality of the ban began to set in, its true cost also became clearer – it would require a nearly $2 billion investment in a fleet of refillable cylinders capable of displacing the preferred non-refillable containers. In addition, the logistics involved with moving refillable cylinders across the country and back to a filler would be onerous and costly. These include shipping, storing, tracking, cleaning, refurbishing, re-valving, recertifying, and accounting for lost or damaged cylinders.

In all, refillable cylinders were expected to be eight times the cost, and that didn’t factor in maintenance.

Worthington Industries, along with ACCA, HARDI, and PHCC, pressed forward and filed petitions asking the U.S. Court of Appeals to overturn the ban on single-use cylinders.

HARDI said it believed the EPA exceeded its authority granted by the AIM Act in finalizing a rule that will increase costs on the HVACR wholesale distribution and contracting industries and could potentially cause major disruptions that will affect consumers.

“HARDI was disappointed by EPA’s overreach in banning single-use cylinders and establishing an overly complicated cylinder tracking system,” Talbot Gee, CEO of HARDI, said. “HARDI and the rest of the industry want to work with EPA to successfully phase down the use of HFCs; however, we cannot stand by as the agency exceeds its authority. We believe filing this lawsuit will help to set a boundary that will stop the agency from going too far in the future.”

By June 2022, the U.S. Supreme Court released a decision that limited the power of federal agencies to set regulations without explicit direction from Congress, including the EPA.

Following that ruling, the HVAC industry felt its challenge to the cylinder ban was strengthened.

The specific case, West Virginia v. Environmental Protection Agency, found the EPA exceeded its authority in requiring states to submit plans to reduce greenhouse gas emissions from plants that generate electricity.

“It is not plausible that Congress gave EPA the authority to adopt on its own such a regulatory scheme” in the Clean Air Act, wrote Chief Justice John Roberts in the majority opinion. “A decision of such magnitude and consequence rests with Congress itself, or an agency acting pursuant to a clear delegation from that representative body.”

“This is really going to help a lot of industries that have been hurt by overregulation,” said Alex Ayers, government affairs director at the Heating Air-Conditioning & Refrigeration Distributors International.

“The courts are not going to be deferential (to agencies) as they have in the past ... unless there is a clear authority” from Congress, Ayers added.

“It just really gets back to the authority to redesign an entire industry. EPA doesn't have that," said Barton James, president and CEO of the Air Conditioning Contractors of America (ACCA).

By June 2023, the industry would have its answer.

The U.S. Court of Appeals for the District of Columbia ruled against the EPA’s ban, concluding that the agency overstepped in authority under the AIM Act, which didn’t explicitly give it the power to enforce a ban.

Additionally, the EPA was also told it did not have the authority to enforce a QR-code tracking system for refrigerant cylinders, as that authority also was not granted to the agency by Congress.

“Since the passage of the AIM Act in 2020, the EPA has been diligently working to get the regulations in place for our industry to phase down the use of HFCs, but with the speed of these regulations comes bad ideas that will damage our members,” HARDI’s Director of Government Affairs, Alex Ayers, said following the ruling. “We continue to fight back with all of our available resources to stop these bad ideas from being implemented. HARDI is happy to see the court agree that the EPA exceeded its authority in banning non-refillable cylinders and requiring the tracking of every cylinder used at consumers’ homes and businesses. HARDI and the entire HVACR industry remain supportive of the HFC phase-down, and we look forward to continuing to work with the EPA in achieving the goals of the AIM Act.”

While the EPA tried to repropose the QR tracking, that was also eventually withdrawn in December 2023. In March of this year, the Department of Transportation also withdrew its proposal to ban non-refillable cylinders.