such as air conditioning and refrigeration, fire suppression, and foam
blowing equipment--recognizing that petitioners may seek, or EPA may
establish, restrictions on other types of equipment using HFCs in the
future.
    Sector. EPA is proposing to define this term as ``a broad category
of applications including but not limited to: refrigeration, air
conditioning and heat pumps; foam blowing; aerosols; chemical
manufacturing; cleaning solvents; fire suppression and explosion
protection; and semiconductor manufacturing.'' These categorizations
and groupings would be similar to how the term ``sector'' is used in
other contexts, such as EPA's Significant New Alternatives Policy
(SNAP) Program, the Montreal Protocol Parties' Technology and Economic
Assessment Panel (TEAP), the statutory language, and EPA's Vintaging
Model. Entities potentially subject to rulemakings proposed under
subsection (i) of the AIM Act are often the same entities affected by
CAA title VI, including the CAA section 612 SNAP program, and may be
familiar with the way EPA traditionally categorizes and groups sectors
in that context. Moreover, TEAP is a globally recognized advisory body
to the Montreal Protocol Parties, which provides technical information
related to alternative technologies that use HFCs in sectors and
subsectors. Entities with a global market presence and other
stakeholders may be familiar with how TEAP defines sectors, and EPA's
proposed definition of sector would be relatable to their understanding
of the term.
    Subsector. EPA is proposing to define this term as ``processes,
classes of applications, or specific uses that are related to one
another within a single sector or subsector.'' Where appropriate, each
sector can be subdivided into different subsectors which more narrowly
highlights how the HFC is used. Entities potentially subject to
rulemakings proposed under subsection (i) of the AIM Act are often the
same entities affected by CAA title VI, including the CAA section 612
SNAP program and may be familiar with the way EPA categorizes and
groups sectors and subsectors, in that context. Therefore, EPA is
proposing that the term ``subsectors'' include the concepts of ``end-
uses'' and ``applications'' under the SNAP Program (40 CFR 82.172). An
example subsector is cold storage warehouses under the refrigeration,
air conditioning and heat pump sector. Another example is the integral
skin polyurethane subsector under foams.
    Substitute. EPA is proposing to define this term as ``any
substance, product, or alternative manufacturing process, whether
existing or new, that is used, or intended for use, in a sector or
subsector with a lower global warming potential than the regulated
substance, whether neat or used in a blend, to which a use restriction
would apply.'' Under this proposed definition, substitutes would
include regulated substances (e.g., HFC-32 used in lieu of R-410A in
commercial unitary AC), blends containing regulated substances (e.g.,
R-454B used in lieu of R-410A in residential unitary AC), blends that
do not use a regulated substance (e.g., R-441A used in lieu of R-410A
in window ACs), alternative substances (e.g., HFOs, hydrocarbons, R-
717, and R-744 (CO2)), and not-in-kind technologies (e.g.,
finger-pump bottles in lieu of aerosol cans, or vacuum panels in lieu
of foam insulation).
    Use. EPA is proposing to define this term as ``for any person to
take any action with or to a regulated substance, regardless of whether
the regulated substance is in bulk, contained within a product, or
otherwise, except for the destruction of a regulated substance. Actions
include, but are not limited to, the utilization, deployment, sale,
distribution, discharge, incorporation, transformation, or other
manipulation.''
    EPA welcomes comment on these proposed definitions. EPA
acknowledges that historical contexts may not fully capture all the
ways that regulated substances are being used and is seeking comment on
additional sectors and subsectors where regulated substances are used
that would fit under this regulatory program.

B. How is EPA proposing to restrict the use of HFCs in the sector or
subsector in which the HFCs are used?

    Subsection (i) authorizes EPA to by rule restrict, fully,
partially, or on a graduated schedule, the use of a regulated substance
in the sector or subsector in which the regulated substance is used.
The provision grants EPA authority to fashion restrictions on the use
of regulated substances in the sectors that use those substances and
does not specify a particular approach as to how restrictions must be
structured but lists a number of considerations EPA is to factor in, to
the extent practicable, when promulgating restrictions. EPA is
considering two possible approaches to structuring those restrictions
in this proposal but recognizes that other approaches could be
considered in the future that would also fit within the authority
granted by this statutory provision.
    In considering the two approaches, we have taken into account the
statutory text, feasibility, consistency with similar programs being
implemented in the states and internationally, impacts on the regulated
community and on innovation, efficiency of implementation, and other
factors. Subsection (i)(4)'s ``Factors for Determination'' provides
factors that EPA is to consider ``[i]n carrying out a rulemaking''
under subsection (i)(1). As a general matter, we interpret subsection
(i)(1) to apply where EPA is deciding whether to impose a restriction
on the use of a regulated substance in a sector or subsector and what
that restriction should be (e.g., a full restriction or a partial
restriction and on what timeframe). However, we also think the factors
listed in subsection (i)(4) are informative in our consideration of how
to structure restrictions, as some approaches may provide advantages
with respect to some of the factors listed in subsection (i)(4) over
others.

    We also note that while subsection (i)(1) identifies that EPA may
restrict the use of a regulated substance ``in the sector or subsector
in which the regulated substance is used,'' we think that, given EPA's
authority to issue partial restrictions, the provision allows EPA to
establish restrictions for particular uses of HFCs, such as products or
applications, and that such restrictions do not need to apply uniformly
across entire sectors or subsectors. Interpreting EPA's authority in
this manner allows the Agency to tailor restrictions in accordance with
the best available data and to consider relevant differences in, for
example, the availability of substitutes with respect to technological
achievability or affordability. For example, EPA is proposing
restrictions for HFCs used in chillers for comfort cooling. However,
chillers for comfort cooling with evaporating temperatures less than -
58 [deg]F are not included in this proposal due to limits in lower-GWP
technology to meet the proposed restriction at this time.
    The two approaches to structuring subsection (i) restrictions that
we are considering at this time were identified in the subsection (i)
petitions granted by the Agency to date. They are: (1) to set GWP
limits for HFCs used within a sector or one or more subsectors; and (2)
to restrict specific HFCs, whether neat or used in a blend, by sector
or one or more subsectors.\38\ For purposes of the restrictions
proposed in this document, which largely respond to the subsection (i)
petitions granted to date by the Administrator, we propose to primarily
employ the GWP limit approach, with some exceptions where we think the
specific-listing approach is more appropriate. We seek comment on both
approaches and have provided sufficient information in this proposal
and the docket to allow the Agency to finalize restrictions using
either approach.\39\
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    \38\ The restrictions on the use of an HFC under subsection (i)
of the AIM Act proposed in this rulemaking are intended to
complement and not conflict with existing restrictions established
through other authorities. Other authorities would still apply.
    \39\ EPA provides a summary of sectors and subsectors affected
by the proposed action, along with the proposed restriction in the
form of GWP limits for most subsectors in section VII.F.2 of this
preamble. The docket contains a list of specific substances that EPA
is proposing to restrict should EPA finalize a specific listing
approach to establish use restrictions rather than a GWP limit
approach.
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GWP Limit Approach
    This proposed approach would restrict the use of HFCs by
establishing GWP limits for HFCs used in each sector or subsector,
whether neat or used in a blend. By establishing GWP limits, only HFCs
with GWPs below the proposed limit or HFCs used in blends with GWPs
below the proposed limit for a particular sector or subsector could be
used in that sector or subsector. If used neat, HFCs with GWPs at or
above the GWP limit would be prohibited from use in that sector or
subsector. If the HFC is used in a blend in the sector or subsector,
compliance with the GWP limit would be determined based on the GWP of
the blend. Blends containing an HFC with GWPs at or above the GWP limit
would be prohibited from use in that sector or subsector.
    For HFCs used in a blend, EPA is proposing that the GWP of the
blend would be calculated to incorporate all components of the blend,
whether an HFC, HFO, HC or other constituent, using the 100-year
integrated AR4 values. We note that the 100-year integrated GWP values
in Table 2.15 of AR4 for the HFCs are equivalent to the exchange values
listed in the AIM Act and thus what we plan to use here without change.
For further details about determining the GWP of compounds that are not
listed in AR4, see section V.A of this preamble.
    In most cases it is the specific HFC and the proportion of that HFC
within the blend that determines the GWP of the blend as a whole. Under
this proposal, EPA is not restricting the use of all HFC blends. For
instance, if a GWP limit of 150 is established for regulated substances
used in a particular sector or subsector, HFC-134a, which has a GWP of
1,430, could not be used. However, R-451A, which is a blend of HFC-134a
and HFO-1234yf, has a GWP of 146 and could be used in a sector or
subsector with a GWP limit of 150. This approach would allow for the
continued use of an HFC with a GWP above the limit EPA establishes when
it is used in a blend with a GWP below the limit. There may be certain
characteristics associated with a higher-GWP HFC that makes use of that
substance in a blend particularly advantageous, such as reducing
flammability. Making available substitutes that would not otherwise be
available under an approach that did not permit the use of higher-GWP
HFCs, even when in a lower-GWP blend, would achieve beneficial
environmental impacts sooner, smooth the transition, and support
innovation. This approach is consistent with the approach used by other
governments including the European Union (EU). EPA notes that this
approach would not change in any way the calculation established under
40 CFR part 84, subpart A for determining the quantity of production
and consumption allowances required for regulated substances used in
blends.
    Even where petitions have asked EPA to restrict specific regulated
substances or blends containing an HFC in various sectors and
subsectors, EPA can translate those requests into restrictions using
the GWP limit approach. EPA would select GWP limits that would, in
effect, prohibit the use of named HFCs (neat) and named blends in the
specified sector. For example, in its granted petition, Natural
Resources Defense Council et. al. (NRDC) requested that the Agency
restrict the use of R-507A (GWP 3,990), R-404A (GWP 3,920), R-428A (GWP
3,610), R-422C (GWP 3,390), R-434A (GWP 3,250), HFC-227ea (GWP 3,220),
R-421B (GWP 3,190), R-422A (GWP 3,140), R-407B (GWP 2,800), and R-422D
(GWP 2,730) for new remote condensing units. In this example, EPA's
starting point for considering a GWP limit for new remote condensing
units would be 2,730, to include within the prohibition the blend with
the lowest GWP among those in the petition. EPA then would use the
considerations laid out in subsection (i)(4) to determine the
appropriate GWP limit restriction that would also account for available
substitutes in the remote condensing unit subsector; by definition,
that proposed GWP limit would prohibit (or fully restrict) the specific
named HFCs and blends containing HFCs requested by the petitioner.
    One benefit of the GWP limit approach is that the regulatory
certainty it would provide would encourage the continued development
and implementation of HFC substitutes with lower GWPs. Under this
approach, companies would be free to innovate so long as the substitute
did not exceed the GWP limit. Where EPA has established a GWP limit for
a particular sector or subsector, based on available and
technologically achievable substitutes, new HFCs or blends containing
an HFC used in that sector or subsector would need to meet that
threshold. This approach would also provide a more efficient and
streamlined process for companies to employ these lower-GWP substitutes
for new uses, because the existing restrictions would make clear
permissible uses. A substance-specific listing approach could create
hesitancy to innovate because it would be less clear whether EPA might
restrict a particular blend containing an HFC after a company had
already invested resources in developing it for a particular use. By
establishing GWP limits, this program would foster

innovation to next-generation substitutes.
    Perhaps recognizing these same advantages, other governments
undertaking programs to restrict HFCs have embraced this approach,
including the state of California, Canada, and EU member countries.
Many of the granted petitions including those submitted by
environmental advocates, industry trade associations, and state
governments, demonstrated broad support for using GWP limits.
Furthermore, many of the businesses in the potentially affected sectors
or subsectors are familiar with this approach already and may already
comply with GWP limits in certain markets. Therefore, EPA's use of the
GWP limit approach, which is familiar to companies operating in other
jurisdictions, could potentially support innovation, transition, and
compliance.
Specific Listing Approach
    The second approach EPA is considering would be to list
specifically restricted HFCs and blends containing HFCs by sector or
subsector. Using the NRDC petition example described previously, under
this approach EPA would prohibit the use of the ten blends contained in
the petition (R-507A, R-404A, R-428A, R-422C, R-434A, HFC-227ea, R-
421B, R-422A, R-407B, and R-422D) in new remote condensing units. The
NRDC petition appears to be based on the SNAP Program's use of
acceptable, acceptable subject to use conditions, and unacceptable
lists and requests restrictions that would be equivalent to the changes
of status in SNAP Rules 20 and 21 which were partially vacated and
remanded to the Agency (80 FR 42870, July 20, 2015 and 81 FR 86778,
December 1, 2016, respectively).\40\
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    \40\ After a court challenge, the D.C. Circuit partially vacated
the SNAP 2015 Rule ``to the extent it requires manufacturers to
replace HFCs with a substitute substance,'' and remanded to EPA for
further proceedings. Mexichem Fluor, Inc. v. EPA, 866 F.3d 451, 464
(D.C. Cir. 2017) (``Mexichem I''). However, the court upheld EPA's
decisions in that rule to change the listings for certain HFCs in
certain SNAP end-uses from acceptable to unacceptable as being
reasonable and not arbitrary and capricious. Id. at 462-64. The same
court later issued a similar partial vacatur for portions of the
SNAP 2016 Rule. See Mexichem Fluor, Inc. v. EPA, 760 Fed. Appx. 6
(Mem) (per curiam) (D.C. Cir. 2019) (``Mexichem II'').
---------------------------------------------------------------------------

    While EPA's experience implementing the SNAP program under section
612 of the CAA provides some insight into the advisability of using a
substance specific listing approach to structure restrictions under
subsection (i), EPA recognizes that Congress provided separate
authority under subsection (i) of the AIM Act. Section 612(c) of the
CAA requires EPA to promulgate rules making it unlawful to replace ODS
with any substitute that it determines may present adverse effects to
human health or the environment where it has identified an alternative
that (1) reduces the overall risk to human health and the environment
and (2) is currently or potentially available. Section 612(c) further
requires EPA to ``publish a list of (A) the substitutes prohibited
under this subsection for specific uses and (B) the safe alternatives
identified under this subsection for particular specific uses.'' Under
SNAP, EPA evaluates substances that can be used as alternatives based
on a number of criteria and accordingly lists them as acceptable,
unacceptable, acceptable subject to use conditions, acceptable subject
to narrowed use limits, or pending. See 40 CFR 82.180(a)(7) (listing
criteria for review) and 40 CFR 82.180(b) (describing types of listing
decisions). EPA has considered more than 450 alternatives for eight
industry sectors and more than 40 end-uses since 1994.\41\
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    \41\ As noted in section VII.A of this preamble, there is
significant overlap between the sectors and subsectors identified in
this proposal and how sectors and ``end-uses'' are categorized under
the SNAP program.
---------------------------------------------------------------------------

    Based on EPA's experience with using the substance-specific lists
to establish use conditions or narrowed use limits under SNAP, we
anticipate that using substance-specific lists to communicate the
restrictions established under subsection (i) could be unwieldy and
less advantageous. We note that in contrast to section 612(c) of the
CAA, subsection (i)(1) does not expressly mention publication of a list
for substances that are restricted. Moreover, the substance-specific
approach could present the challenge of needing to continually update
the list of HFCs and blends containing an HFC as they are introduced.
For example, if EPA has already restricted one particular use of an HFC
in a blend for a given use, a company could reformulate the blend
slightly, even increasing the high-GWP HFC component, and start using
it for that same use. EPA would then need to initiate a rulemaking to
restrict that new HFC formulation for that use, even though it was
clear from the outset that lower-GWP alternatives already existed.
    However, we acknowledge that the substance-specific listing
approach may be simpler to implement in some instances, particularly
when there are only one or a few regulated substances used or
restricted in a specific sector or subsector. Listing these restricted
substances explicitly would provide specificity to the regulated
community as to exactly what is prohibited. It also allows anyone to
compare the regulated substance used to the list of restricted
substances and know whether the product is in compliance, avoiding the
intermediate step of determining the GWP of the HFC or blend containing
an HFC before knowing whether that particular substance meets the
established limit.
    This approach may also be preferable when substitutes continue to
be in development. It may be beneficial to allow additional time before
establishing a GWP limit while still restricting those substances that
have the highest environmental impact. This approach would allow for
the adoption of multiple transitional substitutes and allow for the
development of additional substitutes.
    We think both approaches could also be used in combination, with
some subsectors having a GWP limit and others where specific substances
are restricted. We note that petitions granted under subsection (i)
requested restrictions using both of these approaches, and one possible
approach for the final rule would be to establish, if appropriate, the
type of restriction (GWP limit or substance-specific) requested in the
petitions for that particular subsector. For example, most petitions
regarding the RACHP subsectors requested GWP limit restrictions. EPA
suspects that this may be due to the number of HFCs and blends
containing an HFC used in those subsectors. However, in some cases not
all petitioners were in agreement on the structure of the restriction.
For example, some petitions regarding the cold storage warehouse
subsector requested that EPA establish a GWP limit of 150 while others
requested EPA to prohibit the use of listed HFCs and blends containing
an HFC.
    The Agency is proposing to establish restrictions on the use of
HFCs by establishing GWP limits by sector or subsector in most
instances. As discussed further in section VII.F.3.e of this preamble,
EPA is proposing to restrict specific HFCs, whether neat or used in a
blend, in some instances where the situation making the substance
specific listing approach is advantageous. EPA is seeking comment on
the GWP limit approach, the specific listing approach, other possible
regulatory models that the Agency should consider, and a combination of
approaches either for this proposed rule or for future rulemakings
under subsection (i) of the AIM Act.

C. Applicability

    The AIM Act provides that the Administrator may by rule restrict,

fully, partially, or on a graduated schedule, the use of a regulated
substance in the sector or subsector in which the regulated substance
is used. HFCs are used in a wide variety of applications, including
refrigeration and air conditioning, foam blowing agents, solvents,
aerosols, and fire suppression. In these applications, HFCs are often
used as a refrigerant, foam blowing agent, and fire suppression agent
or may be contained and used within a product. HFCs can also be used in
processes such as solvent cleaning, blowing open cell foam,
semiconductor manufacturing, or chemical usage.
    The AIM Act does not define ``use.'' The dictionary definitions for
that term include ``to put into action or service'' \42\ and ``to take,
hold, or deploy (something) as a means of accomplishing a purpose or
achieving a result; employ.'' \43\ For several reasons, we think
``use,'' in the context of subsection (i)(1), was intended to include
actions taken with respect to regulated substances that occur at the
market or industry level, such as manufacture, distribution, sale,
offer for sale--i.e., to cover the presence of HFCs in products and
processes in the U.S. market as a way of addressing their use in
sectors and subsectors.
---------------------------------------------------------------------------

    \42\ Merriam-Webster. Available at: https://www.merriam-webster.com/dictionary/use.
    \43\ Lexico.com. Available at: https://www.lexico.com/en/definition/use.
---------------------------------------------------------------------------

    First, subsection (i) grants EPA authority to restrict the use of a
regulated substance ``in the sector or subsector in which the regulated
substance is used.'' While sectors and subsectors are not defined in
the AIM Act, those terms suggest groupings or categories of related
activity at an industry level, and as discussed in section VII.A of
this preamble, EPA is proposing definitions for ``sectors'' and
``subsectors'' that are consistent with historical usage of those terms
in other programs--grouping together similar or related industrial or
market uses in distinct sectors, for example, refrigeration and air
conditioning, or foam blowing, or aerosols. ``Use of a regulated
substance in the sector or subsector in which the regulated substance
is used'' indicates that the grant of authority under subsection (i)
was intended to cover a sector or subsector's use of a regulated
substance, and that use certainly covers the inclusion of a regulated
substance in a product \44\ to achieve a particular purpose or the
employment of a regulated substance in a process, as those are
prototypical uses for sectors that are most likely to be using
regulated substances, such as the inclusion of an HFC as a refrigerant
in a refrigerator or air conditioner for cooling purposes.
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    \44\ Similarly, subsection (i)'s authority extends to regulated
substances contained in a blend and the use of that regulated
substance within a blend by the sector or subsector in a product or
process to achieve a particular purpose. In order to address the
regulated substance within a blend, it may be appropriate to
establish requirements that apply to use of the blend, although the
blend itself is not a regulated substance.
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    Second, because subsection (i) and the subsection (i)(4) factors
are focused on broad, sector-level information, it is reasonable to
interpret ``use'' broadly, in a way that would reach uses on a sector-
level basis. The subsection is titled ``Technology Transitions,'' and
in subsection (i)(4), the Act directs EPA to consider certain factors,
to the extent practicable, in issuing a rulemaking or making a
determination to grant or deny a petition regarding use restrictions.
The factors listed under subsection (i)(4) task the Agency with
examining information relevant to industry-level sectors or subsectors
that would inform consideration of the feasibility and advisability of
a transition away from the use of a regulated substance in that sector
or subsector, as well as consideration of whether that transition
should be full, partial, or on a graduated schedule. For example, in
subsection (i)(4)(B), the Act directs EPA to factor in ``the
availability of substitutes for use of the regulated substance that is
the subject of the rulemaking or petition, as applicable, in a sector
or subsector, taking into account technological achievability,
commercial demands, safety, consumer costs, building codes, appliance
efficiency standards, contractor training costs, and other relevant
factors, including quantities of regulated substances available from
reclaiming, prior production, or prior import.'' The various subfactors
in (i)(4)(B) help EPA to determine whether there are adequate available
substitutes for a regulated substance that a sector or subsector could
use, indicating feasibility, readiness, advisability, and degree of a
sector or subsector transition away from the regulated substances in
use. Similarly, the other factors in (i)(4)--to use best available
data, to consider overall economic costs and environmental impacts, as
compared to historical trends, and to consider the remaining phasedown
period for regulated substances under the phasedown rule issued under
subsection (e), if applicable--also fit with this understanding of
EPA's task: to determine whether, when, and to what degree it is
appropriate to establish a use restriction to facilitate the transition
away from the use of regulated substances in a sector or subsector.
    Third, Congress provided EPA authority to issue restrictions that
are full, partial, or on a graduated schedule. Fully restricting the
use of a regulated substance in the sector or subsector in which it is
used, by its terms, implies a full transition away from the use of that
regulated substance in the given sector or subsector. We therefore
understand the term ``use'' to be broad enough to achieve a full
transition. In order to effectuate a full transition, we would have to
be able to address all the aspects where the regulated substance is
present in that sector or subsector of the market. There may be
situations where a restriction is best targeted at points in the life
cycle or market chain of the regulated substance that are subsequent to
the incorporation of the regulated substance in a product or process,
as well as points in the chain that are proximate to ultimate use.
Thus, we interpret the term ``use'' as being broad enough to reach
points such as transport or offer for sale.
    EPA therefore proposes to interpret use of a regulated substance in
the sector or subsector for purposes of subsection (i) as ``for any
person to take any action with or to a regulated substance, regardless
of whether the regulated substance is in bulk, contained within a
product, or otherwise, except for the destruction of a regulated
substance. Actions include, but are not limited to, the utilization,
deployment, sale, distribution, discharge, incorporation,
transformation, or other manipulation.'' EPA's proposed definition of
``use'' covers all of the links on the chain representing how regulated
substances would be introduced, incorporated into products or
processes, circulated, and made available in the U.S. market. To the
extent EPA has determined, considering the (i)(4) factors, such as the
availability of substitutes, that it is appropriate and possible to
fully restrict the use of an HFC in a particular sector or subsector,
we think that restriction must be able to extend across all the points
in the chain. For example, if stakeholders submit a petition to EPA
asserting that the Agency should fully restrict use of a certain HFC or
HFCs over a certain GWP in motor vehicle air conditioning (MVAC), and
EPA agrees such restriction is appropriate, based on consideration of
the (i)(4) factors to the extent practicable, we interpret subsection
(i) to authorize the restriction of such use of HFCs in every part of
the market chain. A narrower interpretation could hamper EPA's ability
to

effectively implement a full restriction on HFC use in a sector or
subsector. For example, if EPA were to define ``use'' as only the
manufacture of a product containing an HFC but not sale of that
product, then the manufacture of a MVAC system with the restricted HFC
would be prohibited, because the air conditioning sector would be
restricted from that ``use'' of the HFC. Sale of MVAC systems
manufactured with the restricted HFC would not be considered part of
the sector's ``use'' of an HFC and would therefore be permissible,
either because the unit had been imported or because it had made it to
store shelves, despite a restriction on its manufacture. This would
circumvent the intended full transition of the MVAC subsector away from
use of HFC. Covering all points in the chain of ``use in the sector or
subsector'' ensures that the use restrictions we establish achieve
their intended purpose. However, even though EPA's proposed definition
of ``use'' is broad in order to facilitate a full transition to HFC
substitutes where appropriate, that does not mean that in every
instance the restrictions promulgated under subsection (i) will
exercise that full authority. In many cases, including in this proposed
action, EPA may issue partial restrictions that target only certain
uses.
    The AIM Act also provides EPA other authorities to issue certain
regulations for the purpose of maximizing reclamation and minimizing
release of regulated substances from equipment and to ensure the safety
of technicians and consumers.\45\ We have not yet established
regulations under those provisions and therefore do not intend to apply
our authority under (i) to actions associated with steps in the
disposal or reclamation chain such as recovery, recycling, and
reclamation of a regulated substance at this point.
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    \45\ As explained in the Allocation Framework Rule that in the
context of allocating and expending allowances, EPA interprets the
word ``consume'' as the verb form of the defined term
``consumption.'' See 86 FR 55122, n. 7 Oct. 5, 2021); see also
definition of ``consumption'' in subsection (b)(3) of the AIM Act
and 40 CFR 84.3. The distinct term ``consumer'' is not defined in
the AIM Act. In the context of subsection (i) of the AIM Act, we
understand and are using the term ``consumer'' in a more general
way, consistent with its everyday dictionary meaning, for example to
refer to a person who purchases goods or services for personal use
or the ultimate consumer of a product.
---------------------------------------------------------------------------

    We also do not intend that this rule apply to the ordinary
utilization or operation of a regulated product by an ultimate
consumer. Given that this is the outset of the phasedown of HFCs, there
is an opportunity to efficiently achieve significant emission
reductions by limiting the introduction of new products to the U.S.
market and restricting the circulation of those products (e.g., sale
and distribution) before they reach the ultimate consumer. We therefore
are proposing restrictions on the manufacture, import, export, sale,
and distribution of products, rather than on restricting ongoing,
ordinary operation and utilization by ultimate consumers.\46\
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    \46\ We note, however, that in some cases the ultimate consumer
may have purchased a product where the first incorporation of the
regulated substance occurs when the product is in the ultimate
consumer's ownership, and in those cases that incorporation would be
covered by the proposed requirements.
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    Further, in this rule, EPA is not proposing to apply the
requirements established through this rulemaking to certain
applications of HFCs eligible for application-specific allowances under
40 CFR 84.13. Under subsection (i)(7)(B)(i) of the AIM Act, a rule
promulgated under subsection (i) ``shall not apply to . . . an
essential use under clause (i) or (iv) of subsection (e)(4)(B)'' of the
AIM Act, ``including any use for which the production or consumption of
the regulated substance is extended under clause (v)(II) of that
subsection'' of the Act. Subsection (e)(4)(B)(iv) lists six
applications which are to ``receive the full quantity of allowances
necessary, based on projected, current, and historical trends'' for the
five-year period after enactment of the AIM Act. EPA has codified these
six applications at 40 CFR 84.13 and established a framework for
allocation of allowances for these application-specific needs. Under
the implementing regulations at 40 CFR 84.13, the following
applications are currently eligible to receive application-specific
allowances for calendar years through 2025: (1) as a propellant in
metered dose inhalers; (2) in the manufacture of defense sprays; (3) in
the manufacture of structural composite preformed polyurethane foam for
marine use and trailer use; (4) in the etching of semiconductor
material or wafers and the cleaning of chemical vapor deposition
chambers within the semiconductor manufacturing sector; (5) for
mission-critical military end uses; and (6) for onboard aerospace fire
suppression. Therefore, EPA is not proposing to apply the requirements
under this rulemaking to these uses of HFCs in these six specific
applications at this time, since they are currently receiving
application-specific allowances under 40 CFR 84.13. This aspect of the
proposal is reflected in the proposed exemption in section 84.58.
Further, EPA has not at this point designated any essential uses under
subsection (e)(4)(B)(i). If EPA makes such a designation in the future,
EPA would consider at that point how to ensure consistency with
subsection (i)(7)(B)(i).
1. Which uses is EPA proposing to restrict in this proposal?
    Under the proposed definition of ``use'' EPA would be exercising
its authority under subsection (i) to cover a broad chain of activities
associated with regulated products. In this rule, EPA's proposed
restrictions on that broad chain of activities are designed to apply
only at certain points in this chain, consistent with the direction
that EPA ``may by rule restrict, fully, partially, or on a graduated
schedule.'' With respect to the specific sector and subsector
restrictions proposed in this document, EPA proposes to adopt a uniform
understanding of when the restrictions would begin to apply and
explains in this section how the commencement of EPA's restrictions
would apply to both regulated products manufactured in the United
States and imported regulated products.
    For purposes of this rule, EPA is proposing restrictions on newly
manufactured products (and the subsequent sale, distribution, export,
and offer for sale or distribution of those products) and is not
proposing to apply the specific use restrictions that are the subject
of this action to existing products or equipment and used products or
equipment, except as to the import of existing or used products or
equipment. For additional discussion regarding products for export, see
section VII.C.2 of this preamble. For additional discussion regarding
existing products or equipment, see section VII.C.3 of this preamble.
    We think the most efficient and effective way to encourage
transition from the use of these HFCs is to restrict the incorporation
of HFCs into products entering the U.S. market for the first time. This
restriction would primarily be borne by original equipment
manufacturers (OEMs) and importers of products, as these are the
entities that introduce products into the U.S. market. Given that this
is the first rulemaking under subsection (i), and there are many
products that are currently being manufactured or imported using HFCs
and blends containing HFCs (or are intended to use HFCs and blends
containing HFCs) in the sectors and subsectors for which EPA is
proposing restrictions, the use restrictions in this proposed rule are
intended to only apply to the manufacture and import of regulated
products and the subsequent sale, distribution, export, and offer for
sale or distribution of those products.

    EPA is proposing that the compliance date for the restrictions on
the sale, distribution, or export of a regulated product be one year
after the compliance date for the prohibition on production and import.
Most of the proposed restrictions on the manufacture and import of
products using HFCs have a proposed compliance date of January 1, 2025.
As such, restrictions on the sale and distribution of those products
would be January 1, 2026. Providing one year to sell existing inventory
should be sufficient given that compliance date would be more than two
years from the date of the final rule and many manufacturers are
anticipating this action. EPA prefers a time-limited period during
which products can continue to be sold over an approach that
indefinitely exempts the sale of existing inventory. Having a date
certain for the sale and distribution of regulated products facilitates
enforcement of the manufacturing and import restriction. Manufacturers,
importers, and distributors can avoid stranding inventory by promptly
beginning their transitions. EPA welcomes comment on the effect of a
one-year sell through, including the potential for stranding inventory
or disadvantaging entities that have completed their transitions.
    As noted, for the most part, EPA is designing its restrictions to
apply to newly manufactured products and equipment rather than existing
or used products and equipment (both addressed below). However, EPA is
proposing to restrict the import of existing and used products that do
not meet the proposed GWP limits or other restrictions. EPA does not
interpret the AIM Act's restriction on EPA's authority to regulate
equipment in existence in the sector or subsector prior to December 27,
2020, as applying to imports of equipment that was manufactured prior
to that date but was not imported until after that date (see section
VII.C.3 of this preamble for additional discussion). EPA is electing to
apply its GWP limit restrictions or other restrictions to imports of
existing and used products and equipment because failing to prohibit
the import of these products could have the effect of undermining the
transition from higher-GWP HFCs in the sectors and subsectors that are
the subject of this proposal. Permitting the import of existing and
used products that did not meet the proposed restrictions could shift
market share away from domestically manufactured products that use
conforming lower-GWP HFCs or substitutes, towards imported products
that continue to use higher-GWP HFCs. The goal of restricting the use
of regulated substances (i.e., higher-GWP HFCs) in the named sectors
and subsectors would be undermined if those sectors and subsectors
simply shifted use to imported existing or used products containing
higher-GWP HFCs. EPA is seeking comment on its proposal to apply
restrictions on the use of HFCs to the import of existing and used
products.
    The AIM Act defines ``import'' as ``to land on, bring into, or
introduce into, or attempt to land on, bring into, or introduce into,
any place subject to the jurisdiction of the United States, regardless
of whether that landing, bringing, or introduction constitutes an
importation within the meaning of the customs laws of the United
States,'' and we have proposed to codify that definition into our
subpart B regulations. We note that this statutory definition contains
no threshold volume of business an entity would need to undertake in
order to qualify as an importer. As such, EPA intends its proposed
restrictions to cover any importation of regulated products. The
Agency's intention is to cover the activities of importers bringing
large shipments of products or equipment into the country, as well as
activities of entities bringing smaller groups of regulated products
into the country (e.g., driving a truckload of air conditioning units
across the Canadian or Mexican border for sale in the United States).
    As discussed above, because EPA proposes to interpret ``use'' to
include activities in the market chain involving regulated products
that occur subsequent to manufacture or import, the proposed use
restrictions would also apply to any person who sells, distributes,
offers for sale or distribution, makes available for sale or
distribution, or exports any regulated product in the sectors or
subsectors controlled under subsection (i). Applying the restriction in
this way ensures that the goal of restricting the use of regulated
substances in the sectors or subsectors in which the regulated
substances are used can be achieved, because the sector and subsector's
use of the regulated substance is present in all these aspects of the
market chain, and EPA's intention in this proposal is to restrict use
across that chain. Therefore, even if a manufacturer or importer
improperly introduces a regulated product that does not meet the
proposed restriction into the U.S. market, distributors and retailers
offering that product for sale, including online retailers, are also
restricted from covered activities related to that product. The intent
of the proposed restriction is to remove products that do not meet the
proposed limits from circulation in the U.S. market.
    However, EPA is proposing not to apply its GWP limit restrictions
or other restrictions to the sale or distribution, or offer for sale or
distribution, of used products. By used products, we mean products that
have been in the ownership of an ultimate consumer and have experienced
ordinary operation or utilization by an ultimate consumer. Some
regulated products, such as air-conditioning and refrigerated
appliances, are often conveyed with the sale of a building and could
not reasonably be excluded from that conveyance. Other regulated
products may be incorporated into a larger good, such as an MVAC in a
motor vehicle, which may be sold multiple times during the useful life
of the good. Restricting the sale of used products or equipment that
use HFCs likely would significantly decrease the value of those goods
and impact the market for used products (e.g., trading in a used motor
vehicle during the purchase of a new one). Extending the proposed
restriction to the sale of used products could have overall detrimental
environmental effects, by requiring consumers to discard products or
equipment before the end of the product's useful life, and could
negatively impact affordability for consumers by eliminating options to
purchase used products. EPA typically has not restricted the sale of
used products containing ODS and proposes to maintain a similar
approach for this rule. We note that our proposed exemption for the
sale or distribution, or offer for sale or distribution, of used
products is intended to cover both individuals selling products they
have used (e.g., an appliance they have owned and used for a period of
time) as well as entities that do volume business in used products
(e.g., stores selling second-hand goods or car-dealerships selling pre-
owned vehicles). However, this used products exemption is not intended
to cover entities that purchase products that are subject to the
proposed restrictions on manufacture and import, hold those products
for a period of time, and then re-sell the products. We have
accordingly specified that products must have experienced ordinary
operation or utilization by an ultimate consumer for a period of time
in order to qualify for the proposed used product exemption.

2. Would the proposed use restrictions also apply to products that are
manufactured for export?
    As discussed above, EPA interprets a sector or subsector's ``use''
to cover not only manufacture and import of a regulated product, but
also the subsequent activities in the market chain related to regulated
products. Specifically, we interpret export to be included in the
meaning of ``use.'' Where EPA has determined, consistent with
consideration of the factors listed in subsection (i)(4), that it is
appropriate to restrict the use of HFCs, we believe it would be
reasonable for restrictions on domestically manufactured products
intended for the U.S. market to apply equally to domestically
manufactured products intended for export. Applying the proposed
restrictions to all domestically manufactured regulated products treats
materially similar uses of HFCs in the same manner. Including exports
as one of the activities subject to the proposed rule's prohibitions
would prevent the limited supply of HFCs in the United States from
being exported in products that could use substitutes. A company cannot
file for a request for additional consumption allowances based on the
export of a product containing regulated substances; requests for
additional consumption allowances are limited to the export of bulk
HFCs. 40 CFR 84.17. As with products manufactured for domestic use, one
intent of this regulation is to ensure that sectors and subsectors that
are currently using HFCs and that are well-positioned, per EPA's
determination under the (i)(4) factors, to transition to substitutes,
actually make that transition, leaving more of the limited supply of
HFCs for those sectors and subsectors that currently cannot use
substitutes. In addition, including exports as a prohibited activity
also supports global efforts to address HFC uses in light of the Kigali
Amendment, and could be welcomed by countries that have or intend to
also restrict the use of HFCs in a similar manner.
3. Would restrictions apply to existing equipment?
    Under subsection (i)(7)(B)(ii) of the Act, ``a rule promulgated
under this subsection shall not apply to, . . . except for a retrofit
application, equipment in existence in a sector or subsector before the
date of enactment of this Act.'' 42 U.S.C. 7675(i)(7)(B)(ii). As such,
EPA's proposed restrictions would not apply to the sale or
distribution, or offer for sale or distribution, or export of any
equipment that was in existence in the sector or subsector prior to
December 27, 2020, the date on which the AIM Act was enacted.
    EPA is codifying the statutory exemption for equipment in existence
in a sector or subsector prior to December 27, 2020, into the proposed
regulations. We propose that modifications, servicing, or repairs to
equipment in existence prior to December 27, 2020, would not be
considered ``manufacture'' under this proposed rule, and that these
actions with respect to existing equipment would therefore not change
the status of whether this equipment ``existed'' prior to December 27,
2020, and render such equipment subject to the proposed restrictions.
Subsection (i)(7)(B)(ii) of the Act refers to equipment in existence
before December 27, 2020. ``Equipment'' could encompass not just a
product or appliance, but also components or parts of that product or
appliance. Even if a person were to service, repair, or replace parts
of a product or appliance, other parts of that equipment would still
have been in existence prior to December 27, 2020, and would arguably
be outside the scope of EPA's regulatory authority under subsection
(i)(7)(B)(ii). In limited cases, where every part of a piece of
equipment had been altered or replaced after December 27, 2020, such
equipment would fall outside the statutory and regulatory exemption. In
addition, under the AIM Act subsection (i)(7)(B)(ii), EPA retains
authority to apply its restrictions to ``retrofit applications,'' where
existing equipment is upgraded by changing the regulated substance
used. See AIM Act subsection (i)(7)(A). The Act specifies that
``retrofit'' is where upgrades are made to existing equipment where the
regulated substance is changed and which ``(i) include the conversion
of equipment to achieve system compatibility and (ii) may include
changes in lubricants, gaskets, filters, driers, valves, o-rings, or
equipment components for that purpose.'' EPA is not at this time
proposing provisions addressing retrofits.
    EPA interprets subsection (i)(7)(B)(ii)'s limit on authority to
regulate existing equipment to be applicable to equipment that existed
before December 27, 2020, but is proposing that equipment be in the
United States to qualify for that exception. Subsection (i)(7)(B)(ii)
provides an exception for ``equipment in existence in a sector or
subsector before December 27, 2020,'' (emphasis added) which EPA is
proposing to interpret as a sector or subsector in the United States.
In general, where those terms appear in the AIM Act, EPA understands
them to mean the domestic sector or subsector, not the sector or
subsector as it exists, operates, and functions in another country. For
example, in assessing the availability of substitutes in a sector or
subsector under subsection (i)(4)(B), EPA is proposing to, in general,
analyze the various subfactors--consumer costs, building codes,
appliance efficiency standards, contractor training costs--vis a vis
the domestic impacted sector or subsector.\47\ Therefore, EPA is
proposing that a product that was manufactured in another country and
existed prior to December 27, 2020, but was not imported to the United
States until after that date is not subject to subsection (i)(7)(B)'s
limitation, because until it is imported into the United States, it is
not ``in existence in the sector or subsector.'' EPA therefore proposes
that its prohibitions on import would apply to all regulated products
imported after the effective date of the rule, even if those products
existed in another country prior to December 27, 2020.
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    \47\ EPA is examining international information for some of the
analyses, such as research from international organizations about
technological achievability, because such information has relevance
for the sector or subsector in the United States.
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4. Effective and Compliance Dates of Rules Promulgated Under Subsection
(i)
    Subsection (i)(6) of the AIM Act states that ``[n]o rule under this
subsection may take effect before the date that is 1 year after the
date on which the Administrator promulgates the applicable rule under
this subsection.'' EPA interprets this provision as applying to the
establishment of restrictions on use of HFCs under subsection (i)(1) of
the Act. Therefore, EPA is proposing compliance dates for the proposed
restrictions on the manufacture and import of regulated products that
are at least one year from the date the rule is promulgated, in
accordance with this statutory provision. Factors that may affect these
compliance dates include the timing for availability of substitutes,
the HFC phasedown schedule, and other factors such as building code
updates.
    The proposed provisions that are focused on program administration
and petitions processing (i.e., Sec.  84.64), do not include a delayed
compliance date, so EPA proposes that those provisions come into effect
30 days after publication of the final rule in the Federal Register.
This approach is based on an interpretation that (i)(6) does not apply
to those provisions because ``applicable rules'' in (i)(6) are

limited to rules that apply use restrictions under (i)(1). As a
practical matter, the regulated industry to which a use restriction
rule is being applied may need a full year to come into compliance with
that restriction. While a petitioner may need some amount of time to
collect the information this action proposes to impose, we think 30
days is a reasonable timeframe in which to do so. EPA is soliciting
comment on this interpretation and is also soliciting comment on
whether it should instead interpret subsection (i)(6) to apply to the
other provisions under subsection (i) and provide at least a year to
come into compliance with those provisions as well.

D. How is EPA proposing to address restrictions on the use of HFCs
requested in petitions granted?

    EPA is addressing three sets of petitions in this proposed action:
the 11 petitions granted or partially granted on October 7, 2021;
additional petitions submitted by the Air-Conditioning, Heating and
Refrigeration Institute (AHRI) which updated previously submitted
petitions; and two petitions granted by EPA on September 19, 2022. EPA
is addressing these granted petitions in a single rulemaking rather
than through separate proposals. In some instances, particularly where
the petitioned sectors and subsectors overlap, responding through a
single rulemaking allows for a complete analysis in a single location.
Consistent with EPA's authority under subsection (i)(1) of the AIM Act,
EPA is also proposing restrictions on the use of HFCs in certain
sectors and subsectors that were not included in petitions received by
the Agency to date.
1. Petitions Granted on October 7, 2021
    On October 7, 2021, EPA granted ten petitions and partially granted
one petition under subsection (i) of the AIM Act (86 FR 57141, October
14, 2021). Copies of petitions granted (including the full list of
petitioners and co-petitioners), a detailed summary of each petition,
and EPA's rationale for granting these petitions are available under
Docket ID EPA-OAR-2021-0643. Five of the granted petitions specifically
requested that EPA replicate, in varying degrees, certain restrictions
on use of HFCs based on the changes of status contained in EPA's SNAP
Rules 20 and 21. These five petitions were received from the Natural
Resources Defense Council et al. (hereby, ``NRDC''); DuPont (two
petitions); American Chemistry Council's Center for the Polyurethanes
Industry (hereby, ``CPI''); and the Household & Consumer Product
Association and National Aerosol Association (hereby, ``HCPA''). These
petitions requested restrictions on the use of specific HFCs or blends
containing HFCs in refrigeration, air conditioning, and heat pump,
foams, and aerosols sectors.\48\ Another five petitions requested that
EPA establish GWP limits for HFCs used in certain stationary AC and/or
refrigeration subsectors. These petitions were received from the
Environmental Investigation Agency et al. (hereby, ``EIA''), AHRI (two
petitions), Association of Home Appliance Manufacturers (hereby,
``AHAM''), and International Institute of Ammonia Refrigeration et al.
(hereby, ``IIAR''). The one partially granted petition, submitted by
California Air Resources Board et al. (hereby, ``CARB''), requested two
types of restrictions: (1) certain restrictions on the use of HFCs
contained in EPA's SNAP Rules 20 and 21 in the RACHP, foams, and
aerosols sectors and (2) restrictions on the use of HFCs based on GWP
limits in certain stationary AC and refrigeration subsectors. CARB also
requested EPA regulations should not limit states' ability to further
limit or phase out the use of HFCs in their jurisdictions.
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    \48\ EPA notes that while these petitioners requested that EPA
establish restrictions on the use of HFCs by restricting specific
HFCs or blends containing HFCs, it does not necessarily mean that
these petitioners preferred this restriction format over
establishing restrictions on the use of HFCs by establishing GWP
limits. EPA believes that these petitioners requested restrictions
on the use of specific HFCs and blends containing HFCs in this way
to replicate the format presented in SNAP Rules 20 and 21.
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2. How is EPA proposing to address additional petitions that cover
similar sectors and subsectors?
    EPA received two additional petitions from AHRI on August 19, 2021,
and October 12, 2021. The first petition requested that EPA establish
transition dates for ``New Refrigeration Equipment'' \49\ for certain
commercial refrigeration subsectors listed, along with the associated
maximum GWP. AHRI requested that the transition dates be at least two
years after the adoption of safety standards and building codes.\50\
AHRI's second petition in this category requested that EPA establish
transition dates for ``New Refrigeration Equipment'' for specific
chiller applications listed, along with the associated maximum GWP.
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    \49\ AHRI suggests a definition for ``New Refrigeration
Equipment'' as follows: equipment built with new components and
equates to a nominal compressor capacity increase across the
refrigeration appliance or an increase of the CO2
equivalent of the refrigerant in the refrigeration appliance. Under
this suggested definition, the replacement of components in Existing
Refrigeration Systems would be permissible if the nominal compressor
capacity is not increased across the refrigeration appliance or the
CO2 equivalent of the refrigerant in the refrigeration
appliance is not increased.
    \50\ A discussion on the status of safety standards and building
codes that may impact compliance dates is in section VII.E of this
preamble.
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    EPA is treating these two AHRI petitions as addenda to their
October 7, 2021, granted petitions, and not as separate petitions,
since the subsectors listed in these petitions are contained in the
granted AHRI petitions and AHRI refers to these as further steps in the
transition for these uses. The main difference between the requested
action in these two petitions and the granted petitions is the lower
GWP limits with later compliance dates. Since EPA is considers these
two petitions as addenda to petitions granted on October 7, 2021, this
proposed rulemaking addresses these requests.
3. Petitions Granted on September 19, 2022
    On September 19, 2022, EPA granted two additional petitions that
requested EPA establish restrictions on the use of HFCs in certain
commercial refrigeration subsectors based on GWP limits. These
petitions were received from AHRI and IIAR and covered similar
commercial refrigeration subsectors contained in petitions granted on
October 7, 2021. One difference to note is that both the AHRI and IIAR
petitions requested restrictions on the use of HFCs for equipment types
beyond what was covered in many of the petitions granted on October 7,
2021 (i.e., all equipment with refrigerant charge capacities less than
200 pounds) in listed subsectors. EPA granted these petitions based on
its consideration of the (i)(4) factors in light of the information
then available. Given the Agency was already developing this proposed
rulemaking which addresses restrictions the use of HFCs in the sector
and subsectors contained in these newer petitions, recognizing the
extensive overlap with the petitions granted on October 7, 2021, and in
an effort streamline rulemakings, EPA is addressing these newer
petitions in this proposal, as well. Copies of the AHRI and IIAR
petitions can be found in the docket for this proposal.

E. Subsection (i)(4) Factors for Determination

    Subsection (i)(4) of the AIM Act directs EPA to factor in, to the
extent practicable, a number of considerations in evaluating petitions
and in carrying

out a rulemaking. EPA is not proposing regulatory text regarding these
factors at this point; however, this section provides a summary of how
the Agency interprets the (i)(4) factors and how EPA considered them
for the current proposal. EPA's consideration of the (i)(4) factors
served as the basis for the restrictions the Agency is proposing for
each sector and subsector covered by this proposal (for additional
discussion see section VII.F.1 of this preamble).
1. How is EPA considering best available data?
    Subsection (i)(4)(A) of the AIM Act directs the Agency to use, to
the extent practicable, the best available data in making a
determination to grant or deny a petition or when carrying out a
rulemaking under subsection (i). In this context, EPA interprets the
reference to best available data as an instruction with respect to the
other factors under (i)(4) rather than as an independent factor. EPA
notes best available data may not always mean the latest data. For
example, the latest data may benefit from peer review. This should not
be interpreted as meaning EPA would only consider best available data
to be peer-reviewed data, but that peer review is one consideration
that could inform our understanding of what is the best available data
in particular situations.
    The best available data that the Agency is considering for this
proposal includes, but is not limited to, the following: SNAP program
listing decisions; Montreal Protocol reports by TEAP and its Technical
Options Committees, and Temporary Subsidiary Bodies (e.g., Task
Forces); \51\ TSDs from states with HFC restrictions; \52\ information
from other federal agencies and departments (e.g., Department of
Energy); proceedings from technical conferences; and journal articles.
For some of the factors and subfactors, EPA developed TSDs that provide
information from these sources and others that EPA believes to be the
best available data. Furthermore, EPA is considering information
provided to the Agency from industry, trade associations, environmental
non-governmental organizations, academia, standard-setting bodies,
petitioners, stakeholder meetings that the Agency hosted, and other
sources in response to EPA making the petitions publicly available
through Docket ID No. EPA-HQ-OAR-2021-0289, to the extent that we think
such information represented best available data. EPA welcomes comment
on these and other sources that the Agency should consider concerning
the (i)(4) factors.
---------------------------------------------------------------------------

    \51\ The Technical Economic Assessment Panel is an advisory body
to the parties to the Montreal Protocol and is recognized as a
premier global technical body; reports available at: https://ozone.unep.org/science/assessment/teap.
    \52\ An example is CARB's Initial Statement of Reasons and
Standardized Regulatory Impact Assessment (SRIA) report. Available
at: https://ww2.arb.ca.gov/rulemaking/2020/hfc2020.
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2. How is EPA considering the availability of substitutes?
    Subsection (i)(4)(B) of the AIM Act directs EPA to factor in, to
the extent practicable, the availability of substitutes for use of the
regulated substance that is the subject of the rulemaking or petition,
as applicable, in a sector or subsector. Several factors inform the
availability of substitutes for use in sectors and subsectors, based on
the statutory language in subsection (i)(4)(B). As part of EPA's
consideration of availability of substitutes, the AIM Act directs us to
take into account, to the extent practicable, the following subfactors:
technological achievability, commercial demands, affordability for
residential and small business consumers, safety, consumer costs,
building codes, appliance efficiency standards, contractor training
costs, and other relevant factors, including the quantities of
regulated substances available from reclaiming, prior production, or
prior import.
    EPA is not proposing definitions for each of these subfactors but
is providing an interpretation of how consideration of the subfactors
relates to the consideration of the availability of substitutes. EPA is
considering the (i)(4)(B) subfactors collectively, with no one
subfactor solely governing the restrictions proposed for any sector or
subsector. EPA is not required to weigh all subfactors equally when
considering the availability of substitutes. Subsection (i)(4) directs
the Agency to consider the factors listed in (i)(4), including
availability of substitutes, ``to the extent practicable.'' EPA
interprets this phrase to extend to its consideration of the subfactors
in (i)(4)(B), given that these subfactors are to be taken into account
in considering the availability of substitutes ``to the extent
practicable.'' Furthermore, not all the subfactors in (i)(4)(B) may be
applicable to each sector or subsector. For example, appliance
efficiency standards would not be applicable to aerosols. Similarly, it
may not be practicable to consider some subfactors in some situations;
for example, there may not be sufficient available data regarding a
specific subfactor. Likewise, EPA anticipates that in most situations,
no single subfactor will be dispositive of its consideration of the
availability of substitutes under subsection (i)(4)(B). For this
proposal, the Agency's consideration of the availability of substitutes
took into account, to the extent practicable, the relevant subfactors
using the best available data. Additional information on some of these
subfactors is available in the docket.
    Lower-GWP HFCs and substitute substances and technologies that can
be used in place of higher-GWP HFCs have been the subject of evaluation
for decades. EPA, state and foreign governments, industry standards
organizations, and international advisory panels have long been
identifying and assessing substances that can be used in lieu of
higher-GWP HFCs and their predecessors, often for uses within the
sectors and subsectors subject to this proposal. EPA has therefore
drawn upon information generated by these efforts in considering the
subsection (i)(4) factors in the context of this proposal, and in
particular, in considering the availability of substitutes under
subsection (i)(4)(B). While these entities have evaluated substitutes
for HFCs in other contexts, the information generated by these efforts
provides a useful starting point. For example, in the SNAP program
under section 612 of the Clean Air Act, EPA identifies and evaluates
substitutes for ODS in certain industrial sectors, including
refrigeration, air conditioning, and heat pumps (RACHP); aerosols; and
foams. To a very large extent, HFCs are used in the same sectors and
subsectors as where ODS historically have been used. Under SNAP, EPA
evaluates acceptability of substitutes for ODS based primarily on the
potential human health and environmental risks, relative to other
substances used for the same purpose. In so doing, EPA assesses
atmospheric effects such as ozone depletion potential and global
warming potential, exposure assessments, toxicity data, flammability,
and other environmental impacts. This assessment could take a wide
range of forms, such as a theoretical evaluation of the properties of
the substitute, a computer simulation of the substitute's performance
in the sector or subsector, lab-scale (table-top) evaluations of the
substitute, or equipment tests under various conditions. These
assessments under SNAP are relevant to some of the subsection (i)(4)
factors, particularly with respect to safety (and the resultant impact
on availability of a substitute under (i)(4)(B)) and environmental
impacts. We have therefore considered SNAP assessments and listings of
acceptable substances in our

consideration of the (i)(4) factors and establishment of use
restrictions under subsection (i).
    Further, manufacturers and formulators submit substitutes to EPA
for evaluation under SNAP which can lead to the substitute being added
to the list of acceptable substances. EPA believes that if a
manufacturer has submitted a substance for evaluation under SNAP, it
would be reasonable to consider that as a possible indication that the
substitute is technologically achievable for a given sector and that
there is commercial demand for it. In addition, a substitute listed by
EPA as acceptable for a given end-use under SNAP would most likely have
been submitted by industry only if the submitter felt that the
substitute was possibly technologically achievable and that there could
be a market for such substitute.
    In this proposal, EPA has also considered the work undertaken by
the TEAP. The TEAP analyzes and presents technical information and
recommendations when specifically requested by parties to the Montreal
Protocol. It does not evaluate policy issues and does not recommend
policy. Such information is related to, among other things, substitutes
that may replace the substances controlled under the Protocol and
alternative technologies that may be used without adverse impact on the
ozone layer and climate. The TEAP assesses the technical and economic
feasibility of substitutes for sectors and subsectors that use HFCs and
publishes various technical reports through different technical
committees, such as the Refrigeration, Air Conditioning, and Heat Pumps
Technical Options Committee.\53\ In TEAP's evaluation of HFC
substitutes, subfactors such as technological achievability and
affordability have been considered to some extent. For this proposal,
EPA considered technical and economic information from the TEAP's 2018
Quadrennial Assessment Report and the recent 2022 Progress Report,
including the response to ``Decision XXXIII/5--Continued provision of
information on energy-efficient and low-global-warming-potential
technologies'' found in Volume 3 of the Progress Report.\54\ \55\ \56\
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    \53\ The TEAP 2018 Quadrennial Assessment Report includes
sections for each of the Technical Options Committees (TOC):
Flexible and Rigid Foams TOC, Halons TOC, Methyl Bromide TOC,
Medical and Chemicals TOC, and Refrigeration, Air Conditioning and
Heat Pumps TOC. Available at: https://ozone.unep.org/science/assessment/teap.
    \54\ In accordance with Article 6 of the Montreal Protocol,
every four years the parties request assessments from various
advisory bodies, including the TEAP's quadrennial assessment of the
sectors and subsectors covered by the petitions. Under Decision
XXVIII/2 the TEAP is also instructed to review HFC substitutes every
five years. The parties also routinely request reports considering
transitions and/or related topics (e.g., commercial fisheries,
energy efficiency for the refrigeration and air conditioning
sector).
    \55\ TEAP 2022 Progress Report (May 2022) and 2018 Quadrennial
Assessment Report. Available at: https://ozone.unep.org/science/assessment/teap.
    \56\ Volume 3: Decision XXXIII/5--Continued provision of
information on energy-efficient and low-global-warming-potential
technologies, Technological and Economic Assessment Panel, United
Nations Environment Programme (UNEP), May 2022. Available at:
https://ozone.unep.org/system/files/documents/TEAP-EETF-report-may-2022.pdf.
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    EPA also considered materials developed by or submitted to state
and foreign governments with requirements that restrict the use of
HFCs. Many of these jurisdictions highlight available substitutes that
can be used for regulated substances that are the subject of this
proposed rulemaking. This is not an exhaustive list of sources that EPA
could use in the future to consider the availability of substitutes.
Section VII.E.1 of this preamble describes additional sources of
information that the Agency considers to be best available data. For
future Agency actions under the technology transitions program, EPA
would likely again consider information from these sources to assess
availability of substitutes but notes that the Agency may augment or
omit sources where appropriate to be consistent with the Agency's
interpretation of subsection (i)(4)(A).
    In this proposal, EPA is identifying substitutes \57\ for use of
regulated substances in specific sectors or subsectors by reviewing
information from several of these sources, which the Agency considers
to be best available data. EPA compiled a non-exhaustive list of
substitutes available that informed the GWP limit or restriction that
EPA is proposing. See American Innovation and Manufacturing Act of
2020--Subsection (i)(4) Factors for Determination: List of Substitutes,
referred to in this preamble as the ``List of Substitutes TSD.'' That
TSD and list were developed after considering, to the extent
practicable, the (i)(4)(B) subfactors, as discussed below and in the
other TSDs available in the docket. Substitutes for regulated
substances have been identified in this list as available for the
sectors and subsectors for which EPA is proposing restrictions.
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    \57\ Inclusion of a substitute, either in the preamble or the
docket, is for informative purposes only and is not intended as an
EPA endorsement or recommendation.
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    EPA notes that some of the substitutes EPA lists as available for a
sector or subsector may not be available uniformly throughout the
United States and/or be subject to state or local regulations,
including building codes (see section VII.E.2.d of this preamble). The
AIM Act directs EPA to factor in, to the extent practicable, the
availability of substitutes but does not limit our consideration to
only those substitutes that can be used without restrictions, including
state or local regulations. EPA is also considering research and
development both in the United States and in other countries, which may
indicate the availability of substitutes for use in the near or long
term. EPA notes that the list of substitutes in the docket, in
isolation, does not represent EPA's complete analysis of the
availability of substitutes.
    The rest of this section provides information on EPA's
interpretation of the subfactors that subsection (i)(4)(B) directs EPA
to take into account, to the extent practicable, in assessing the
availability of substitutes.
a. Commercial Demands and Technological Achievability
    Two of the separate subfactors that subsection (i)(4)(B) directs
EPA, to the extent practicable, to take into account in its
consideration of availability of substitutes are commercial demands and
technological achievability. This section provides information on how
the Agency views each term on its own, their potential impact on
availability of substitutes, and their interconnectedness.
    EPA views commercial demands as interest from OEMs and product
manufacturers to use substitutes in products for ultimate sale or
distribution. An OEM's interest in using a substitute is tied to their
ability to meet consumer needs. One method to determine commercial
demands is to assess what types of products in a sector or subsector
are for sale and what regulated substances or substitutes are being
used. Another means for assessing commercial demands is to review the
information companies provide including but not limited to information
concerning planned releases of products or equipment using substitutes.
    EPA views technological achievability as the ability for a
substitute to perform its intended function in a sector or subsector.
For example, technological achievability can be demonstrated through a
substitute's compliance with or listing by standard setting bodies such
as ASHRAE or the Underwriters Laboratories (UL) or use through testing
and demonstration labs and projects.
    EPA is providing additional information in the TSD American

Innovation and Manufacturing Act of 2020--Subsection (i)(4) Factors for
Determination: Technological Achievability and Commercial Demands,
referred to in this preamble as the ``Commercial Demands and
Technological Achievability TSD''; this TSD supports the Agency's
consideration of the commercial demands and technological achievability
subfactors and is available in the docket. The Commercial Demands and
Technological Achievability TSD identifies information on products
using substitutes that are commercially available (i.e., products for
sale), or where manufacturers indicate they soon will be available, by
sector and subsector. EPA views commercial availability of products
using substitutes as an indication of both commercial demand and
technological achievability. In other words, a product using an
available substitute in a market means that the particular substitute
is technologically achievable and that there is a commercial demand for
that substitute. The Agency relied on a range of sources and considered
where products are already available as well as where products are
expected to be available given their use in other countries and/or
manufacturer announcements. These sources include, but are not limited
to, publicly available data such as information on ENERGY STAR
products, company websites, SNAP listings, news articles, market
reports, and communication with industry experts. EPA also considers
information that was provided to relevant state bodies as informative
when considering whether a technology is achievable or in commercial
demand for the purposes of evaluating available substitutes in their
respective rulemakings. Another source for considering technological
achievability and commercial demand is the information provided by
petitioners.\58\ EPA notes that the Agency did not attempt to consider
all versions and models of all products or equipment in every sector or
subsector.
    EPA is not limiting its consideration of commercial demands and
technological achievability to a specific geographic region since
products may be introduced in a few markets first. The information
provided in this proposed rule and the Commercial Demands and
Technological Achievability TSD available in the docket are based on
the best available data and were considered to the extent practicable.
    EPA is seeking comment on the Agency's interpretation of commercial
demand and technological achievability and their potential impact on
availability of substitutes.
b. Consumer Costs and Affordability for Residential and Small Business
Consumers
    Subsection (i)(4)(B) directs EPA, to the extent practicable, to
take into account consumer costs and affordability for residential and
small business consumers, among other subfactors, in its consideration
of availability of substitutes. For this proposed action, which is
targeted at restricting the use of HFCs in products by certain sectors
and subsectors, EPA is considering these two subfactors together. EPA
views residential and small business consumers as a subset of consumers
at large, and any estimated costs to consumers because of proposed use
restrictions includes costs to these groups. Most small businesses and
most consumers, including residential consumers, would be downstream of
the actions that would be taken in response to the proposed
restrictions. Upstream users would include manufacturers who could be
introducing new products that conform with the proposed restrictions,
while most small businesses, such as installers and service
technicians, would be further downstream of such actions, as would most
consumers, including residential customers.
    EPA evaluated the impacts of the rule on small business consumers
in affected sectors and found that the vast majority of affected small
businesses will experience zero or positive net impacts due to the
reduced costs of substitute chemicals as compared to HFCs. EPA also
expects the impacts on service technicians to be minimal because the
transitions to different refrigerants required by this proposed rule
are already occurring in many of the subsectors addressed due to
compliance with other regulations being implemented in some states.
Although not affecting the entire United States, the advantages of
having products that can be sold nationally and comply with regulations
in export markets has led many manufacturers to begin the transition to
HFC alternatives. Further, several corporations have established
internal sustainability goals and as part of those efforts they are
addressing the HFC used in their businesses and products. Additional
information on potential impacts of the proposed rule on small
businesses can be found in the Small Business Regulatory Enforcement
Fairness Act (SBREFA) \59\ screening analysis located in the docket for
this rulemaking.
---------------------------------------------------------------------------

    \59\ Economic Impact Screening Analysis for Restrictions on the
Use of Hydrofluorocarbons under Subsection (i) of the American
Innovation and Manufacturing Act, available in the docket.
---------------------------------------------------------------------------

    One factor that affects affordability for residential and small
business consumers is up-front capital costs for new equipment.
Compared to large businesses, both groups may be less likely to be able
to afford high up-front capital costs that, for some subsectors, may
ease the transitions. Such costs, however, do not have to be borne
immediately by either residential or small business consumers. This
rule does not propose that equipment be retired by any specific date,
nor are estimates of emission reductions associated with these proposed
restrictions predicated on the assumption that equipment would be
retired prematurely. Additionally, HVAC services generally comprise
only a small fraction of income for residential consumers.
    We expect that under the HFC phasedown, access to HFCs, both newly
manufactured and reclaimed, will continue far into the future
particularly given that the AIM Act directs EPA to phase down and not
to phase out HFC production and consumption. There already exists a
network of reclaimers who offer reclaimed HFCs that can be used to
service existing equipment for its full useful life. EPA notes that
reclaimed chlorofluorocarbons (CFCs) and hydrofluorocarbons (HCFCs)
remain available in the United States for servicing equipment that was
designed, sold, installed, and may today still be operated by
residential consumers and small businesses throughout the United
States. Furthermore, as explained in this section below, we find that
overall, the proposed rule is expected to provide net savings to the
economy, which may in turn be passed on to small businesses and
residential consumers.
    For this proposal, which covers a wide range of sectors and
subsectors, EPA has prepared a Costs and Environmental Impacts TSD
summarizing some analytical results--including the expected costs and
negative costs (i.e., savings) to industry associated with
transitions--that we factored in, in our consideration of these
subfactors. Specifically, the Costs and Environmental Impacts TSD
summarizes the increase in costs, or the savings, to industry
associated with transitioning from a regulated substance to a
substitute. EPA believes that the best way to analyze consumer costs
and affordability is to look not at the cost of a product using a
substitute, but rather at expected changes in costs resulting

from the transition. Hence, this discussion (and the Costs and
Environmental Impacts TSD) refers to the cost of a regulated product
with a substance that complies with the proposed restriction compared
to that same product using a prohibited substance. For example, for the
residential and light commercial air conditioning and heat pump
subsector, the costs of manufacturing units that use lower-GWP
substances or blends (e.g., R-454B), and maintaining the operation of
that equipment, compared to those costs for a baseline unit (e.g., one
that uses R-410A including the operation and maintenance of that unit),
are used to generate an approximate accounting of the full cost (or
potential savings) of the transition. To the extent available, energy
efficiency changes, which can result in savings to, or costs borne by,
the consumer, were factored into the transition scenarios analyzed. EPA
notes that the Costs and Environmental Impacts TSD analysis indicates
that the substitute used could be more or less expensive than the
regulated substance currently or recently used. However, we note that
the cost of using a regulated substance or substitute generally
represents only a small fraction of the total cost of the product.\60\
Even a large change in the cost of the substance that is realized as a
result of the transition (i.e., from using a regulated substance to
using a substitute) would therefore not usually have a significant
impact on the overall cost of the product. Further, given that many
substitutes are engineered to perform in a similar manner as the
regulated substance (e.g., R-513A, R-452B, and R-454B are designed to
perform like HFC-134a, R-404A, and R-410A, respectively), the equipment
to use them would typically not need extensive redesign and would be
expected to have a similar cost and similar performance with either the
regulated substance or the substitute.
---------------------------------------------------------------------------

    \60\ U.S. Department of Energy (DOE), Technical Support
Document: Energy Efficiency Program for Consumer Products:
Residential Central Air Conditioners and Heat Pumps, December 2016.
Available at: https://www.regulations.gov/document?D=EERE-2014-BT-STD-0048-0098.
---------------------------------------------------------------------------

    Data to develop the cost estimates summarized in the Costs and
Environmental Impacts TSD were derived from a variety of information
sources including technical literature and experts, and EPA also
provides additional details regarding the data used in the RIA addendum
and its accompanying appendices and references cited. The cost factors
were applied to develop transition scenarios, consistent with this
proposed rule, using EPA's Vintaging Model and, the resulting costs and
abatement were used in a similar manner as the Marginal Abatement Cost
(MAC) analysis explained in the Allocation Framework RIA.
    It is likely the costs for HFCs will increase given the phasedown
of HFC production and consumption mandated in the AIM Act and the
global HFC phasedown under the Kigali Amendment to the Montreal
Protocol. The Agency is aware of some price increases to date. However,
EPA notes that for the RACHP sector, the cost of refrigerant is less
than one percent of the entire cost of the system, and the highest
costs come from raw materials such as copper, steel, and aluminum that
are used to make the equipment.\61\ In most cases, with newer, more
efficient refrigerants, less refrigerant is necessary in the finished
product. This can decrease the amount of copper, steel, and aluminum
necessary for the product since it decreases the amount of raw material
needed to create heat transfer elements in the equipment. The most
recent increases in the price of HFCs are not included in this
analysis, and the savings from using less raw materials and improved
energy efficiency are only applied where literature supporting such
claims was found. Thus, estimated costs of these proposed restrictions
(as presented in the Costs and Environmental Impacts TSD) are
conservative, and the net savings would likely be higher than
estimated. Further, the costs of substitutes are likewise not modeled
as changing over time. Although some substitutes are modeled as being
more costly than HFCs today, the experience with the ODS phaseout has
been that prices generally decline as production increases, as more
producers negotiate licensing agreements for certain chemicals, and as
patents expire. For example, EPA compiled a memo in the docket which
provides a non-exhaustive list of several announcements that have been
made regarding the initiation or updating of production plants for
various substitutes.\62\ Here again, estimated costs, as presented in
the Costs and Environmental Impacts TSD, are conservative. EPA will
continue to monitor these markets to determine whether updates to our
analysis are appropriate. As such, we request comment on information
regarding up-to-date costs of HFCs and substitutes, and the energy-
efficiency implications when applied to equipment in the subsectors
addressed in this proposed rule, to help inform our analysis of costs.
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    \61\ Consumer Cost Impacts of the U.S. Ratification of the
Kigali Amendment, JMS Consulting in partnership with INFORUM,
November 2018. Available in the docket.
    \62\ See memo in the docket that presents company announcements
of increased production of lower-GWP substitutes. This memo is for
informational purposes and does not represent endorsement by the
Agency. EPA further notes that this memo is a non-exhaustive
sampling of announcements; there may be other companies announcing
increased production of lower-GWP substitutes.
---------------------------------------------------------------------------

    EPA has previously analyzed ``consumer costs'' in relation to
``compliance costs'' and found very little difference in these.\63\ EPA
performed this analysis, placed in the docket, as Congress was
considering the AIM Act in 2019. Part of the reason for this is that
energy efficiency changes of equipment when switching from a regulated
substance to a substitute, where available, are included in our
estimates of compliance costs. These costs (or savings) would likely
not affect the installer or service technician, but would be considered
a consumer cost, as it is the consumer who would be affected by this
change in energy efficiency through a higher or lower electric bill.
The consumer could be a residential consumer or a small business
consumer, for instance a restaurant buying a new air conditioning unit.
---------------------------------------------------------------------------

    \63\ See ``American Innovation and Manufacturing Act of 2019:
Compliance and Consumer Cost Estimates'' document in the docket.
---------------------------------------------------------------------------

    Another cost that can be assumed to be a cost to consumers is the
possible mark-up costs of chemicals sold to the consumer, for example
as part of a bill for servicing or repairing an air conditioner where
additional refrigerant was needed. Compared to the regulated substance,
the substitute could be more or less expensive, and hence the mark-up
costs could be more or less than that of the regulated substance. EPA
incorporated this cost to consumers in a previous analysis of the HFC
phasedown as stipulated in the AIM Act that Congress was considering in
2019. In that analysis, the costs to consumers were approximately $0 to
$200 million less than the compliance costs, depending on the
compliance step-down year (2020, 2024, 2029, and 2034 were analyzed).
Compared to the total cumulative costs or savings estimated, these
differences represented no more than a 20 percent difference, and in
all cases were decreases in total costs or increases in total savings.
Therefore, our cost estimates take into account consumer costs and
affordability for residential and small business consumers insomuch as
the estimated costs are likely conservative, and the savings to
consumers would be greater.
    EPA also analyzed whether the proposed action could have a
significant

economic impact on a substantial number of small business consumers.
The analysis found that approximately 162 of the 51,047 potentially
affected small businesses could incur costs in excess of one percent of
annual sales and that approximately 110 small businesses could incur
costs in excess of three percent of annual sales. Based on this
analysis, we do not anticipate a broad, significant economic impact on
small businesses as a result of this proposal.
    EPA is seeking comment on the Agency's interpretation of consumer
costs and affordability for small business and residential consumers
and their potential impact on availability of substitutes.
c. Safety
    Subsection (i)(4)(B) directs EPA, to the extent practicable, to
take into account safety in its consideration of availability of
substitutes. As part of EPA's consideration of safety, EPA is providing
additional information in the TSD American Innovation and Manufacturing
Act of 2020--Subsection (i)(4) Factors for Determination: Safety,
referred to in this preamble as the ``Safety TSD''; this TSD supports
the Agency's consideration of the safety subfactor and is available in
the docket. EPA is reviewing information on flammability and toxicity
as well as the ability of substitutes to meet relevant industry safety
standards. In our interpretation of best available data, we are
evaluating information from recognized industrial sources, including
standard-setting bodies, the SNAP program, international technical
committees, and information from petitions. Safety information on
substitutes may impact the availability of substitutes for use in a
particular sector or subsector, for example, if there are restrictions
on the use of a substance in local building codes and/or regulatory
requirements. Industry acceptance of substitutes that are compliant
with safety standards may also be an indication of safety and,
therefore, impact the use of a particular substitute.
    EPA does not believe that taking into account safety in its
consideration of the availability of substitutes is intended to limit
substitutes to only those that are risk free. EPA has noted under the
SNAP program that the Agency does not require substitutes to be risk
free (59 FR 13044, March 18, 1994). Many industry standards are
designed to mitigate risk and allow for the safe use of flammable,
toxic, or high-pressure substitutes. EPA therefore understands the
direction to take into account safety, to the extent practicable, as
encompassing consideration of information on the risks associated with
the substitute as well as other information that concerns risk
mitigation.
    EPA has considered the listings under the SNAP program in its
assessment of the availability of substitutes in this proposed rule.
The SNAP program, in making decisions to list a substitute as
acceptable or unacceptable, considers whether a substitute presents
human health and environmental risks that are lower than or comparable
to overall risks from other substitutes that are currently or
potentially available. Under this comparative risk evaluation, the
human health risks analyzed include safety, and in particular,
flammability, toxicity, exposure to workers, consumers, and the general
population of chemicals with direct toxicity; and exposure of the
general population to increased ground-level ozone. Under the SNAP
program, EPA makes decisions that are informed by its overall
understanding of the environmental and human health impacts. EPA can
list substitutes as ``acceptable subject to use conditions,''
indicating that a substitute is acceptable only if used in a certain
way. Use conditions can include, but are not limited to, warning
labels, charge limits, unique fittings for servicing of equipment, and
restrictions on where a substitute is used (e.g., normally unoccupied
spaces). EPA can also list substitutes as ``acceptable subject to
narrowed use limits,'' indicating that a substitute may be used only
within certain specialized applications within a sector and end-use and
may not be used for other applications within an end-use or sector. EPA
lists a substitute as acceptable subject to narrowed use limits because
of a lack of available substitutes within the specialized application.
Under the acceptable for narrowed use limits category, users of a
restricted substitute within the narrowed use limits category must make
a reasonable effort to ascertain that other substitutes or alternatives
are not technically feasible for reasons of performance or safety.
Users are expected to undertake a thorough technical investigation of
alternatives to the otherwise restricted substitute. Although users are
not required to report the results of their investigations to EPA,
users must document these results and retain them in their files for
the purpose of demonstrating compliance.
    In its evaluation of the safety subfactor under subsection
(i)(4)(B), EPA is also considering the safety group classification of
refrigerants as designated by the ASHRAE Standard 34. This standard
assigns to a refrigerant, including those that could be used under
EPA's proposed restrictions, a safety group classification consisting
of two to three alphanumeric characters (e.g., A2L or B1). The initial
capital letter indicates the toxicity, and the numeral and trailing
letter, if any, denotes the flammability. Under this standard, Class A
refrigerants are those for which toxicity has not been identified at
concentrations less than or equal to 400 parts per million (ppm) by
volume, based on data used to determine threshold limit value-time-
weighted average (TLV-TWA) or consistent indices. Class B signifies
refrigerants for which there is evidence of toxicity at concentrations
below 400 ppm by volume, based on data used to determine TLV-TWA or
consistent indices. However, some refrigerants that are listed under
the B (higher toxicity) classification of ASHRAE 34 have been used
safely and effectively for many years. For example, after the CFC
phaseout, several companies offered comfort cooling chillers using
HCFC-123, and at least one has since transitioned to R-514A in part of
its product line. These systems generally have low leak rates, are
located away from building occupants in limited-access areas (e.g.,
mechanical rooms) with secured entrances, and utilize refrigerant
sensors and alarms to alert operators of leaks. Building codes further
reduce risks for example by requiring mechanical ventilation to the
outdoor space where such systems are placed.
    The standard also assigns refrigerants a flammability
classification of 1, 2, 2L, or 3. Tests for flammability are conducted
in accordance with American Society for Testing and Materials (ASTM)
E681 using a spark ignition source at 140 [deg]F (60 [deg]C) and 14.7
psia (101.3 kPa) \64\. The flammability classification ``1'' is given
to refrigerants that, when tested, show no flame propagation. The
flammability classification ``2'' is given to refrigerants that, when
tested, exhibit flame propagation, have a heat of combustion less than
19,000 kJ/kg (8,169 Btu/lb), and have a lower flammability limit (LFL)
greater than 0.10 kg/m\3\. The flammability classification ``2L'' is
given to refrigerants that, when tested, exhibit flame propagation,
have a heat of combustion less than 19,000 kJ/kg (8,169 BTU/lb), have
an LFL greater than 0.10 kg/m\3\, and have a maximum

burning velocity of 10 cm/s or lower when tested in dry air at 73.4
[deg]F (23.0 [deg]C) and 14.7 psi (101.3 kPa). The flammability
classification ``3'' is given to refrigerants that, when tested,
exhibit flame propagation and that either have a heat of combustion of
19,000 kJ/kg (8,169 BTU/lb) or greater or have an LFL of 0.10 kg/m\3\
or lower.
---------------------------------------------------------------------------

    \64\ ASHRAE, 2019. ANSI/ASHRAE Standard 34-2019: Designation and
Safety Classification of Refrigerants.
---------------------------------------------------------------------------

    For flammability classifications, refrigerant blends are designated
based on the worst case of formulation for flammability and the worst
case of fractionation for flammability determined for the blend.

Figure 1. Refrigerant Safety Group Classification
[GRAPHIC] [TIFF OMITTED] TP15DE22.028

    Information on the ASHRAE classification of each substitute
identified by EPA for this proposal and additional information on EPA's
consideration of safety are available in the Safety TSD in the docket.
EPA is seeking comment on the Agency's interpretation of safety and its
potential impact on availability of substitutes and the effect of
switching to substitutes on worker and consumer safety in the
subsectors affected by this proposed action.
d. Building Codes
    Subsection (i)(4)(B) directs EPA, to the extent practicable, to
take into account building codes in its consideration of availability
of substitutes. For certain types of equipment, especially in the RACHP
sector, building codes may inform which substances can be used or may
prescribe additional requirements before a specific substance can be
used, thereby impacting availability of substitutes for particular
sectors and subsectors. This section summarizes EPA's understanding of
building code development across the nation generally and how model
building codes are developed and adopted into local building codes. EPA
is considering this information, to the extent practicable, to evaluate
how building codes may affect the availability of substitutes to
regulated substances. EPA is providing additional information in the
TSD American Innovation and Manufacturing Act of 2020--Subsection
(i)(4) Factors for Determination: Building Codes, referred to in this
preamble as the ``Building Codes TSD''; this TSD supports the Agency's
consideration of the building codes subfactor and is available in the
docket.
    Building codes are established at the subnational level and can
differ greatly across jurisdictions. Some states develop their own
building codes and determine the frequency with which they are updated.
Other states adopt (and sometimes amend) ``model'' building codes that
are written by code-setting organizations. Code-setting organizations
include the International Association of Plumbing and Mechanical
Officials (IAPMO), the International Code Council (ICC), and the
National Fire Protection Association (NFPA). Many states allow local
governments to set their own building codes, provided they comply with
the minimum standards established under state building codes. Both
state and local building codes are periodically reevaluated and
updated. The Agency did not review changes to every jurisdiction's
building codes as EPA does not view that as practicable.
    Model building codes, which serve as the basis for many state and
local building codes, incorporate a range of industry standards that
establish specific requirements for building performance or design.
Several of these standards are directly relevant to the availability of
substitutes in the RACHP sector. For this proposed action, EPA is
considering, to the extent practicable, updates to industry standards
and if those updates may be incorporated into model building codes that
will allow the future use of products that use substitutes. EPA also is
considering whether current building codes permit the installation and
use of products using substitutes.
    Model codes are typically updated on a three-year cycle, and most
model building codes were last updated in 2021; the next scheduled
updates are for 2024. Several proposed changes in the current code
development cycle (i.e., for the 2024 codes) could enhance the
availability of HFC substitutes under model building codes in future
years. For example, ICC, an international developer of model codes,
standards, and building safety solutions, approved fourteen code
changes that affect the availability of A2L refrigerants for the RACHP
sector. These code changes, which will go into effect in 2024, are
consistent with updated industry standards that allow the use of
substitutes identified in this proposed rulemaking; however, state and
local building code agencies do not automatically adopt updates to the
model codes. As a result, there may be delays between when the model
codes are updated and when the updated codes are adopted by state and
local agencies.
    Information from stakeholders, including petitioners, indicates
that building codes are being updated both as part of the cyclical
review and off cycle that would allow for the use of additional HFC
substitutes. For example, several states such as Oregon, California,
and Colorado have recently made, or are considering making, changes to
their codes that would effectively incorporate updated industry
standards as reflected in the model code changes that occurred in 2021.
Updated codes may require automatic refrigerant leak detection systems,
circulating fans, and labeling and handling instructions

for flammable refrigerants in certain applications and installations.
    Given that building codes can vary greatly throughout the United
States and that many of the most relevant building codes have either
been updated recently or are likely to be updated in the near future,
EPA's consideration of building codes is limited to model building
codes. Additional information on EPA's consideration of building codes
can be found in the Building Codes TSD in the docket. EPA is seeking
comment on to what extent EPA can take into account building codes
recognizing that they vary based on local circumstance.
e. Appliance Efficiency Standards
    As part of the Agency's consideration of the availability of
substitutes as directed by subsection (i)(4)(B), EPA is taking into
account, to the extent practicable, the appliance efficiency standards
that are applicable to products in the affected sectors and subsectors.
The Agency consulted with U.S. Department of Energy (DOE) regarding
relevant minimum energy efficiency standards and the timing for any
planned changes to the current standards.\65\ DOE, through its Building
Technologies Office and Appliance and Equipment Standards Program, sets
minimum energy efficiency standards for more than 60 different
products, including appliances and equipment used in homes, businesses,
and elsewhere. Several of these categories are within the RACHP sector
and may use HFCs that are covered in this proposed action. Among
product categories relevant to this action are consumer products (e.g.,
refrigerators, freezers, and room air conditioners) and commercial and
industrial products (e.g., automatic commercial ice machines, vending
machines, walk-in coolers, and walk-in freezers).\66\ EPA is providing
additional information in the memo American Innovation and
Manufacturing Act of 2020--Subsection (i)(4) Factors for Determination:
Appliance Efficiency Standards, referred to in this preamble as the
``Appliance Efficiency Standards memo''; this memo supports the
Agency's consideration of the appliance efficiency standards subfactor
and is available in the docket.
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    \65\ For additional information, please refer to the U.S.
Department of Energy's Appliance and Equipment Standards Program
available at: www.energy.gov/eere/buildings/appliance-and-equipment-standards-program.
    \66\ For additional information and a complete list of products,
please refer to the U.S. Department of Energy's website available
at: www.energy.gov/eere/buildings/standards-and-test-procedures.
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    The DOE Appliance and Equipment Standards Program regularly
develops and updates test procedures and appliance efficiency
standards. Future revisions to existing appliance efficiency standards
could impact what substitutes can be used in regulated products in
specific sectors and subsectors. Therefore, EPA is consulting with DOE
so both agencies are aware of the schedules for these separate but
related actions. EPA has identified a list of applicable standards in
relevant sectors and subsectors and which standards may be undergoing
current revision in the Appliance Efficiency Standards memo. We
understand that for redesign and testing of equipment, industry prefers
that DOE and EPA regulations are synchronized where possible. Given DOE
and EPA operate under separate mandates, that may not always be
possible, but sharing information early can reduce inconsistencies such
that, to the extent possible, the refrigerants used to set performance
standards will be available under the technology transitions program.
EPA also recognizes the potential to greatly increase climate
protection by both reducing the GWP of substances used in the relevant
applications (e.g., construction foams, appliances foams, and
refrigerants) covered by this action in the sectors and subsectors we
are addressing and supporting energy efficiency in such applications.
    EPA is seeking comment on to what extent the Agency should consider
current and future minimum energy efficiency standards in taking into
account appliance efficiency standards in the context of subsection
(i)(4)(B). EPA further solicits information on the opportunities to
further climate protection by supporting energy efficiency at the same
time we are restricting the use of HFCs.
f. Contractor Training Costs
    As part of the Agency's consideration of the availability of
substitutes as directed by subsection (i)(4)(B), EPA is taking into
account, to the extent practicable, available information on contractor
training costs, including training related to substitutes for relevant
sectors and subsectors (e.g., certain RACHP, foam blowing, and fire
suppression subsectors). EPA obtained some contractor training and exam
cost data through a review of publicly available literature and from
industry trade and training associations in these sectors as well as
information submitted to EPA in petitions under subsection (i). EPA
notes that it would not be feasible to obtain information and data on
all available training programs and exams and our review represents an
assessment to the extent practicable of information in relevant sectors
and subsectors for contractor training costs. Some substitutes,
including but not limited to flammable (A3 or B3), lower flammability
(A2L or B2L), higher toxicity (B1, B2L, B2, or B3) refrigerants, and
other substitutes with unique or different issues such as those
operating at higher pressures than HFCs, may require specialized or
additional training, knowledge, or expertise to ensure their safe
handling and use. To the extent practicable, the Agency is considering
the cost of trainings to contractors for handling products and
equipment containing substitutes for HFCs or blends containing HFCs
substitutes.
    Manufacturers and trade organizations often provide training and
certification beyond what is required under the regulations
implementing sections 608 and 609 of the CAA for installing and
servicing equipment in conjunction with the release of new equipment.
This is not a new practice; however, as the transition to lower-GWP
refrigerants continues, more technicians are expected to work with A2L
and A3 refrigerants, and a variety of training and education resources
are anticipated to include the incorporation of A2L and A3 refrigerants
into existing curriculum. There are already courses, trainings, and
conferences that focus on lower-GWP refrigerants available among
product categories and across the country. Costs of trainings may be
dependent on several factors, such as the organization providing the
study materials, how the exam is administered, and the location.\67\
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    \67\ In some cases, continued RACHP education may be required at
the state level as a part of a state licensing requirement; training
on using flammable refrigerants may be incorporated to fulfill this
requirement.
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    In the foam blowing and aerosols sectors, certain applications may
require safety training. In particular, the Occupational Safety and
Health Administration (OSHA) requires that contractors providing in
situ installation of spray foams, foam insulation, and aerosols receive
health and safety training regarding the hazards of working in confined
spaces and procedures to avoid injury from fall hazards. OSHA issued a
standard reflected in 29 CFR 1926 Subpart AA--Confined Spaces in
Construction, which requires that employers provide employees free
training to ensure that the employee understands the hazards of working
in a confined space. Additional trainings and exams are

available beyond the basic required safety training and may vary in
costs depending on the level and amount of training a contractor
obtains.
    EPA is seeking comment on our consideration of contractor training
costs in the context of subsection (i)(4)(B) in the sectors and
subsectors covered in this proposed action.
g. Quantities of Regulated Substances Available From Reclaiming, Prior
Production, or Prior Import
    As part of the Agency's consideration of the availability of
substitutes as directed by subsection (i)(4)(B), EPA is taking into
account, to the extent practicable, information on quantities of HFCs
from reclamation and stockpiles of previously produced or imported
HFCs. EPA is providing additional information in the TSD American
Innovation and Manufacturing Act of 2020--Subsection (i)(4) Factors for
Determination: Quantities Available from Reclaiming, Prior Production,
or Prior Import; this TSD supports the Agency's consideration of the
quantities available from reclaiming, prior production, or prior import
subfactor and is available in the docket HFCs available from stockpiles
or reclamation can smooth transitions to alternative technologies and
ensure that existing equipment can continue to be serviced. The Agency
knows from its experience under the ODS phaseout the important role
reclamation in particular plays by providing an ongoing supply of
material. This is true not only for the RACHP sector but a similar
approach is also used for the fire suppression sector. Some companies
choose to stockpile substances and use them to smooth transition. EPA
cannot estimate how much material will be stockpiled for a particular
sector or subsector or by a particular company; however, the Agency can
consider this approach as a general matter.
    Information that EPA is considering includes HFC reclamation data
submitted annually in accordance with the Clean Air Act section 608
reclamation program, codified at 40 CFR part 82, subpart F;
reclamation, production, and import data reported under 40 CFR part 84,
subpart A; \68\ data gathered to support development of the AIM Act
subsection (e) regulations contained in the docket for the 40 CFR part
84, subpart A rules; \69\ and data reported to the GHGRP under subparts
OO and QQ.
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    \68\ In addition to quarterly data, under 40 CFR 84.31, HFC
producers, importers, exporters, application-specific allowance
holders, reclaimers, and fire suppressant recyclers must annually
report the quantity of each regulated substance held in inventory as
of December 31 of each year. As this information becomes available
in future, it can inform EPA's consideration of this factor.
    \69\ Available at www.regulations.gov, in Docket ID No. EPA-HQ-
OAR-2021-0044.
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    EPA is seeking comment on the likely quantities of regulated
substances available from reclaiming and stockpiling and how that may
be factored into the availability of substitutes in the sectors and
subsectors covered in this proposed action. In addition, EPA is
interested in information on stockpiles of used HFCs that do not
require reclamation (e.g., same ownership) that may also be stored by
companies and how those stockpiles may be used.
3. How is EPA considering overall economic costs and environmental
impacts, as compared to historical trends?
    Subsection (i)(4)(C) directs the Agency to factor in, to the extent
practicable, overall economic costs and environmental impacts, as
compared to historical trends. The Act does not prescribe how EPA
should carry out its consideration of this factor, nor does the statute
clearly delineate what is meant by the phrase ``as compared to
historical trends.'' In light of the ambiguity, we interpret the
language of (i)(4)(C) as purposefully accommodating of many different
types and degrees of analysis of economic costs and environmental
impacts (including costs and impacts that may be difficult to quantify)
in part because the nature of EPA's action when applying this provision
can differ greatly depending on the circumstances.
    Subsection (i)(4)(C) applies both to EPA's action on subsection (i)
petitions and to EPA's rulemakings under subsection (i). Subsection (i)
requires EPA to grant or deny petitions within 180 days of receipt, a
time period that inherently limits the scope and depth of any potential
analysis under subsection (i)(4)(C). EPA's timeframe for promulgating a
rule subject to a granted petition is two years from the date of a
petition grant, and in undertaking a rulemaking, whether by negotiated
rulemaking or not, EPA will undoubtedly perform more in-depth analysis
of economic costs and environmental impacts than we would in the more
abbreviated statutory period allotted for petition decisions. As
worded, particularly read in light of subsection (i)(4)'s
acknowledgement that consideration of some factors will be limited by
practicability (i.e., ``to the extent practicable''), the provision has
flexibility to permit EPA to tailor its consideration of this factor
accordingly.
    We note also that subsection (i)(4)(C) would apply to cases where
EPA is considering a broad swath of restrictions--such as this proposed
action, which if finalized would cover more than 40 sectors and
subsectors--as well as cases where EPA is contemplating a much more
limited set of restrictions--potentially for only one sector or
subsector. There may be instances, then, where it is appropriate for
EPA to prepare detailed analyses such those in the Costs and
Environmental Impacts TSD, but also times when new analyses of similar
detail would be unnecessary or inappropriate. As discussed in this
section, EPA considered several different sources of information when
factoring in subsection (i)(4)(C) to EPA's consideration of potential
use restrictions. This information included but was not limited to the
Costs and Environmental Impacts TSD, information previously developed
by EPA concerning HFCs and transitions, our experience with the ODS
program, industry reports, information developed by the TEAP, the
Montreal Protocol's Science Assessments, and other research.
    It is also not clear from the plain language of the statute what
information EPA should consider when thinking about ``historical
trends,'' and how EPA should ``compare'' ``overall'' economic cost and
environmental impact information about newly contemplated restrictions
to those trends. Here too we think the ambiguity of these phrases
accommodates consideration of a variety of information and comparisons
depending on the circumstances and the available information.
    In undertaking this proposed action, EPA does not yet have
historical overall economic cost and environmental impact trends for
previous use restrictions, or transitions from HFCs to substitutes,
under subsection (i) to compare with the overall economic costs and
environmental impacts of the contemplated restrictions. However, we
think it is practicable and reasonable to in part interpret our
obligation to factor in the considerations under subsection (i)(4)(C)
for this proposal by looking at the overall economic costs and the
anticipated environmental impacts of our proposed restrictions as
compared to a scenario where historical trends had continued into the
future, that is, a projection of ``business as usual'' conditions. For
purposes of this proposal, we think a reasonable reading of that
scenario is conditions that would occur if only the Allocation
Framework Rule and the proposed 2024 Allocation Rule were in effect,
and the analysis in

the Costs and Environmental Impacts TSD therefore uses as a baseline
what would occur absent these proposed restrictions. As noted, we do
not think subsection (i)(4)(C) requires a specific type of analysis,
like the one EPA has conducted for purposes of this Costs and
Environmental Impacts TSD, and we anticipate that the Agency could
consider this (i)(4) factor using a different type of analysis in the
future.
    Additionally, as this is the first set of proposed restrictions
under subsection (i) and, if finalized, would result in the first
requirements under the AIM Act to transition away from certain
regulated substances in certain sectors and subsectors, we also think
information about impacts to costs from historical comparable
technology transitions in similar contexts is appropriate. As noted
elsewhere, HFCs are used mainly in the same sectors and subsectors
where ODS were used. EPA therefore has considered the overall economic
costs and environmental impacts of actions taken under the CAA title VI
regulations on ODS in a memo \70\ available in the docket.
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    \70\ See ``Overview of CFC and HCFC Phaseout'' document in the
docket.
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    EPA acknowledges that the ODS phaseout and transitions away from
HFCs as a result of use restrictions each have their own unique
regulatory features and technological transitions at play, potentially
leading to different overall economic impacts and environmental
benefits. The memo discussing the costs and environmental impacts of
the ODS phaseout is included as supplemental information and as a
relevant benchmark, as the transition to HFC substitutes will impact
many of the same industries and entail--in some cases--similar
technological shifts. This same information has been made available by
EPA previously.
    One key historical trend observed during the ODS phaseout, and that
may be relevant to similar technology transitions for HFCs during the
HFC phasedown, is that technology transitions did not necessarily drive
up the cost of products to the consumer or hurt the performance of
products. A clear example of this was discussed in a 2018 report of the
TEAP.\71\ From 1972 through 2015, household refrigerators sold in the
United States underwent several design changes in response to
regulations requiring transition away from ODS refrigerant, ODS-
containing insulation foam, and increases in energy efficiency. Over
that time, the average capacity of refrigerators sold in the United
States also grew to accommodate consumer preferences. Even as
refrigerators became larger, more energy efficient, and transitioned
away from use of ODS, the average price fell in real dollars. Consumers
not only benefitted from the lower initial purchase price, but the
greater energy efficiency also reduced consumers' electricity costs.
This example, and a similar trend seen in household unitary AC units,
are discussed in more detail in the EPA report American Innovation and
Manufacturing Act of 2019: Compliance and Consumer Cost Estimates,
which can be found in the docket.
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    \71\ Decision XXIX/10 Task Force Report on Issues Related to
Energy Efficiency while Phasing Down Hydrofluorocarbons, Technical
and Economic Assessment Panel, UNEP, May 2018. Available at: https://ozone.unep.org/sites/default/files/2019-04/TEAP_DecisionXXIX-10_Task_Force_EE_May2018.pdf.
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    As described in the memo that summarizes the costs of the ODS
phaseout,\72\ the most comprehensive analysis was in a 1999 peer-
reviewed report to Congress. In that report, we summarized the costs of
the allowance allocation and reductions for CFCs, HCFCs, halons, and
methyl chloroform to be $18 billion (7 percent discount rate) to $56
billion (2 percent discount rate) in 1990 dollars.\73\ It was also
noted that the transition to more energy efficient air conditioning
using alternatives to HCFC-22 could lower this cost by $16.8 billion in
1990 dollars.\74\ As opposed to this net cost, the Costs and