GWPs than HCFC-22's GWP of 1810, particularly in residential unitary
air-conditioning--the predominant use of HCFC-22. While not a retrofit,
R-410A is the most common non-ozone depleting substitute for use in
residential air conditioning, with a GWP of approximately 2090. In
retail food refrigeration, which is the second largest HCFC-22 end-use,
some of the alternatives are high GWP refrigerants. For example, the
most common refrigerants used for refrigeration equipment in
supermarkets, R-404A, R-507A and R-407A, have GWPs of approximately
3920, 3990 and 2110, respectively. Certain high-GWP alternatives in the
retail food sector may be subject to additional constraints in the
future since the agency is proposing to change their acceptability
status under its SNAP regulations. If the HCFC allocation level were
set at zero, that could encourage a near-term transition into high GWP
gases that the agency has proposed to remove from the list of
acceptable ODS substitutes (e.g., R-404A and R-507A). Such a result
would mean that a zero allocation would fail to achieve the climate
benefits envisioned by the commenters.
---------------------------------------------------------------------------

    \21\ EPA finds the use of the term ``drop-in replacement'' as
misleading when advertising refrigerants that substitute for an ODS
refrigerant, such as HCFC-22, since the term confuses and obscures
several important regulatory and technical points. At minimum, a new
type of lubricant will often be needed, certain parts such as
elastomer gaskets will need to be replaced, and/or settings such as
on TXVs will need adjustment. EPA also encourages technicians to
repair leaks before re-charging with refrigerant.
---------------------------------------------------------------------------

    Several commenters supporting a zero allocation assert that an
over-supply of HCFC-22 discourages the transition to alternatives. Two
commenters make statements on the rate of transition to HCFC
alternatives. One commenter, ICOR International, notes that recent
history shows that when the HCFC-22 allocation is low and the price of
HCFC-22 is high, recovery rates go up and the transition to
alternatives rapidly accelerates. Hudson Technologies states that
programs like EPA's GreenChill Advanced Refrigeration Partnership have
resulted in a more rapid transition away from HCFC-22 in the
supermarket sector and the proliferation of HFC alternatives now
represent 25 percent of the market. But Hudson Technologies also notes
that HCFC-22 systems operate more efficiently with HCFC-22 than HFC-
based alternatives and states that the use of reclaimed HCFC-22 is the
best solution for HCFC-22 system owners. Several commenters assert that
the 2012-2014 Rule hurt the alternative refrigerant industry, whose
sales decreased significantly. USA Refrigerants believes that the 2012-
2014 Rule was working well to encourage a transition to alternatives
and that SNAP-approved refrigerants are providing cost-effective
alternatives to Americans. Three commenters note that there are several
HCFC-22 alternatives available across a range of applications that are
reducing dependence on HCFC-22.
    The agency supports encouraging new alternatives that offer
improved environmental profiles to HCFC-22. However, as noted above,
many of the existing alternatives in sectors that rely on HCFC-22
(e.g., residential AC and retail food refrigeration) have GWPs
comparable to or higher than HCFC-22. In later parts of this section,
EPA addresses existing HCFC-22 inventories and the importance of
encouraging transition, reclamation and improved refrigerant management
practices.
    Three commenters explicitly oppose a zero allocation approach,
which they believe would cause unanticipated market disruptions. In
meetings after the issuance of the proposed rule and in their comments,
Heating, Air-conditioning and Refrigeration Distributors, International
(HARDI) expressed concerns that a zero allocation approach would leave
insufficient time for distributors to plan their business, especially
considering the long-standing expectation of an allocation through the
end of 2019. Additionally, there are concerns that going to zero so
quickly would leave

some distributors without access to HCFC-22 for the customers who
operate and service HCFC-22 equipment. Another commenter, Arkema,
questions the reclamation industry's ability to be the sole source of
refrigerant needed to service consumer demand. Arkema also notes that
the five-year timeline is especially important as EPA and the
international community shift to regulation of HFCs; there should be no
precipitous incentive to make inefficient switches to alternatives that
may be phased out later. EPA believes its decision to issue allowances
for 2015-2019 addresses these commenters' concerns. The third
commenter, ACCA, does not support a zero allocation because they
believe it would cause tremendous volatility and uncertainty in the
market, which would likely lead to upward price fluctuations.
    In the proposal, EPA recognized that some stakeholders had
encouraged the agency to cease allocating allowances for HCFC-22 in
2015. The proposal noted that a zero allocation could have unintended
consequences, given the longstanding expectation that the agency would
issue allowances through 2019, and could adversely affect the business
and transition planning for much of industry, particularly owners and
operators of HCFC-22 equipment. In their comments and in subsequent
meetings with EPA, many commenters point out that going to zero in 2015
is not supported by a majority of market participants, both small and
large businesses, including but not limited to: Producers, importers,
distributors, contractors, and the end-user community. Given the long-
standing expectation that allowances for production and import of HCFC-
22 would be available through 2019, EPA agrees with comments that
issuing zero allowances for 2015 could cause chaotic and unanticipated
market disruptions, particularly because a zero option was not
proposed.
    The agency continues to believe that a zero allocation is contrary
to the goal of an orderly transition, and would lead to a high degree
of market uncertainty. Given the diverse, and in some cases competing,
legitimate needs, objectives and interests of the HCFC-22 stakeholder
community, EPA can best meet its goal of a smooth transition and a 2020
production phaseout by sending a clear market signal for 2015-2019.
Based on the rationale laid out in the proposed rule and in today's
final rule, EPA is issuing consumption allowances for HCFC-22 in 2015
and beyond.
ii. EPA's Decision To Use a Five-Year Linear Approach for 2015-2019
    Having decided to issue allowances for HCFC-22 during the 2015-2019
regulatory period, the agency's next decision was which methodology to
use in setting the allocation. Based on the considerations below, EPA
is finalizing allowances using a five-year linear approach.
    As a methodology, a linear approach has many clear benefits, not
least of which is that it is simple and easy to communicate to affected
parties. This aspect is important for service technicians, since they
are often the ones directly interacting with home and business owners.
It is often their job to explain what the HCFC phaseout means and how
it works. Providing technicians with an easier-to-explain common sense
approach should improve consumers' understanding of the phaseout and
the options available to them. EPA developed several fact sheets that
discuss the HCFC phaseout and the choices available to consumers to
provide technicians and equipment owners with additional information.
These fact sheets can be found at: www.epa.gov/ozone/title6/phaseout/classtwo.html.
    EPA recognizes that as a chemical reaches its production phaseout,
modeling HCFC-22 servicing needs with precision becomes increasingly
difficult. While EPA's Vintaging Model is updated frequently to reflect
changes in the marketplace, it is not designed to model how the
specific allocation amounts in recent years affects servicing need in
future years, nor is it designed to model certain other events that may
affect supply, e.g., the effects of a hot or cold summer, or the
general state of the economy. The difficulty of predicting certain
real-time market factors is one reason that the agency has not relied
heavily on modeled servicing need in the final HCFC-22 allocation for
2015-2019, and why EPA has always relied on modeling as one tool among
many considered in deciding the final allocation.
    One commenter favors the estimation approach (Option 3) in order to
stabilize the market. Other commenters oppose the estimation approach
because in their view it would reduce incentives for recovery, does not
account appropriately for stockpiles, and allocates more HCFC-22 than
is needed. Another commenter, Johnstone Supply, supports a five-year
phaseout similar to Option 3 but with approximately two-thirds of the
allocation cut.
    Six commenters specifically address technical aspects or parameters
in EPA's 2013 Servicing Tail Report. Several of these commenters
question the report's accuracy and say EPA's projected servicing need
for HCFC-22 does not adequately account for: Sales of alternative and
retrofit refrigerants, declining leak rates (especially for GreenChill
partners), servicing needs, existing HCFC-22 stockpiles, the
capabilities of the reclamation industry, recycling, and future
economic and weather conditions. One commenter, EOS Climate,
incorrectly asserts that EPA assumes growth rates in all categories of
HCFC-22 equipment despite the fact that virgin HCFC-22 can only be used
for pre-2010 equipment and that imports of dry-shipped condensing units
are decreasing. Another commenter, North Lakes Distributing, Inc.,
believes EPA ``has displayed a pervasive unwillingness to scrap the old
inaccurate bottom up analysis,'' such as that used in the Servicing
Tail Report. The commenter believes that if top down manufacturing
supply information is not collected, estimates of usage in individual
market sectors are not useful. EPA reiterates that the five-year linear
approach uses a common sense approach, focused on a 2015 starting
allocation that will encourage transition and a gradual phase out
production and consumption of HCFC-22 by 2020. Also, since the 2015
allocation is less than one-quarter of modeled servicing need as
presented in the 2013 Servicing Tail Report, EPA believes that it has
adequately addressed these commenters' concerns for the purposes of the
2015-2019 allocation. The agency responds to specific comments more
fully in the Response to Comments document.
    Since the market for virgin HCFC-22 is solely for servicing air-
conditioning and refrigeration equipment that was installed prior to
2010,\22\ EPA believes that annually decreasing the allocation by the
same amount over five years is appropriate. Such an allocation schedule
should drive the necessary changes in the service market to prepare for
the 2020 phaseout, without unnecessarily forcing transition or
retrofits out of HCFC-22 equipment that is still within its expected
lifetime. A five-year linear approach sends a clear market signal about
the allowed production and import of HCFC-22 in each year leading up to
the 2020 phaseout date. It also allows industry time to digest, comment
on and participate in the public regulatory process related to actions
EPA is proposing to take under SNAP to further

the goals of the President's Climate Action Plan. Actions under SNAP
may bear on end-users' decisions about continuing to operate equipment
with HCFC-22, or retrofitting or replacing the equipment. EPA is
concerned that a three-year linear reduction to zero could increase the
likelihood that end-users would rush to transition from HCFC-22 without
adequately considering their longer-term options. A five-year approach
provides more time for the introduction of alternatives that reduce
overall risk, before the complete phaseout of HCFC-22 production and
virgin import. A five-year approach with consistent annual decreases
strikes an important balance: Recognizing that the phaseout of virgin
production and import is only five years away, without forcing end-
users to retrofit or replace their equipment designed for HCFC-22.
Continued operation of HCFC-22 equipment also helps ensure that HCFC-22
is valuable; HCFC-22 is less likely to be vented and more likely to be
reclaimed and reused if it has economic value.
---------------------------------------------------------------------------

    \22\ With limited exceptions through the end of 2011.
---------------------------------------------------------------------------

    EPA received numerous comments in support of the five-year linear
approach. Commenters stated that the five-year linear approach will
``provide steady incentives'' to reclaim material and move to
alternatives, while also giving consumers and equipment manufacturers
``sufficient time'' to prepare for the transition. Competition, market
stability and ensured access to HCFC-22 were also cited as reasons to
use a five-year linear schedule for issuing HCFC-22 allowances from
2015 through 2019. EPA generally agrees with these comments.
    EOS Climate prefers the three-year drawdown, claiming that it
partially accounts for existing stockpiles and provides significant
environmental benefits compared to EPA's lead proposal at no additional
cost. NRDC, Combs Investment Properties, Hudson Technologies, and EIA
support a modified 3-year approach if EPA does decide to issue
allowances. One commenter, DuPont, opposes a three-year schedule
because ending the allocation in 2018 would result in a chaotic market.
EPA sees the three-year schedule as having some of the same drawbacks
as the zero allocation approach, given the longstanding expectation
that the agency would issue allowances through 2019. Not allocating
allowances in 2018-2019 could adversely affect the business planning
and transition plans for much of industry, particularly owners and
operators of HCFC-22 equipment. EPA addresses the role of inventory in
the next section and the environmental benefits of EPA's chosen
approach in the previous section.
    EPA has explained here the merits of the linear approach, which are
supported by many commenters. Based on the available data, current
market perceptions and the 2020 phaseout deadline, the agency believes
a five-year linear drawdown best addresses the concerns and suggestions
of a majority of the commenters. In the following paragraphs, EPA
explains why it is finalizing a starting point lower than its preferred
starting point of 13,600 MT.
iii. EPA's Decision To Use a Five-Year Linear Approach, Starting at
10,000 MT in 2015
    Twelve commenters support Option 1, with the lower starting point
of 10,000 MT in 2015. Several of these commenters are industry
associations representing anywhere from 50 to several hundred small and
large businesses. Commenters favor this option because it is one of the
lowest allowance options proposed, it would provide the fewest
allowances in 2015 and 2016, and because the linear approach provides
market stability through its consistent annual decreases in allocation.
The commenters generally advocate for a lower allocation than EPA's
proposed starting point of 13,700 MT in order to send a strong early
market signal of tightening supply, compensate for larger-than-
estimated HCFC-22 inventories, and stimulate reclamation. Five
commenters support Option 1 starting at 13,700 MT. Those in support of
EPA's preferred starting point of 13,700 MT believe that it offers the
smoothest transition, while faster reductions may result in refrigerant
shortages and high prices. The Food Marketing Institute supports a
linear approach, but suggests a higher starting point than 13,700 MT.
Options 2 and 3 each received support as the preferred option from one
commenter.
    The agency is finalizing a 2015 allocation of 10,000 MT, with a
decrease of approximately 2,000 MT each year thereafter. In deciding on
the amount of the 2015 allocation, EPA gave further consideration to
the market factors discussed in the proposal. Many of these market
factors are discussed earlier in this section as support for EPA's
decision to issue allowances in 2015-2019. EPA's decision to finalize a
starting point of 10,000 MT was primarily based on three
considerations: The availability of larger-than-anticipated inventory,
the importance of a viable reclamation industry and the market-
signaling effects of a sufficiently low 2015 and 2016 allocation.
    In the 2012-2014 Rule, the agency estimated industry-wide inventory
to be between 22,700 MT and 45,500 MT. As explained in section VI.A.2,
in the fall of 2013, the agency asked nine entities in the HCFC-22
market about their year-end inventory. Aggregate inventory data from
these nine entities were fully available to EPA while developing the
proposed rule. With the knowledge that aggregate inventory held by
these nine major entities at the end of 2012 was 51,100 MT, which is
higher than the upper end of EPA's estimate used in the 2012-2014
rulemaking, EPA proposed 13,700 MT as its preferred starting point for
2015. At the request of industry, EPA also collected 2013 year-end
inventory data from these same nine companies. At the end of 2013,
inventory had grown by 2,800 MT, an increase of 5.6% from 2012. The
proposed 2015 starting points for the linear draw-down approaches are
much lower than under the estimation approach, in part because of the
inventory data EPA was able to collect and consider while developing
the proposal.
    EPA is aware that these nine entities do not hold all inventory
industry-wide. EPA was not seeking precise inventory numbers. The
agency did not consider inventory as a result of a statutory mandate to
do so. Rather, EPA believed it was reasonable to allow the approximate
scale of inventory and inventory trends to inform its general
understanding of the market. Given the data collected in the fall of
2013, and the numerous conversations with many companies throughout the
supply chain, EPA believes that the data from these nine companies are
representative of the trends and scale of inventory across the entire
market, and that the aggregate held by these nine companies accounts
for a large proportion of total inventory. The data collected show that
aggregate inventory is large enough to justify a starting allocation of
10,000 MT instead of 13,700 MT. While additional inventory data from
more entities might further support a 10,000 MT starting point, these
data would not eliminate the considerations that led EPA to finalize a
non-zero allocation for 2015-2019.
    In addition to comments on the proposal that discuss existing HCFC-
22 inventory as it relates to the proposed allocation options, EPA
received 15 comments on its April 4, 2014, Notice of Data Availability,
announcing the 2008-2013 aggregate HCFC-22 inventory data collected
from nine companies. Six comments reiterated that HCFC-22 aggregate
inventory is higher than expected or previously estimated by EPA. Six
commenters

believe that the nine companies that EPA collected data from do not
represent the entire market, while one commenter believes that nine
entities likely hold a majority of HCFC-22 inventory. One commenter
specifically names other potential sources of HCFC-22 inventory, while
two comment that EPA needs to consider other sources of inventory
beyond the nine surveyed companies like grocery stores and apartment
buildings. Several comments explicitly state that the inventory data
proves that no additional allowances are needed, while another
commenter believes that the aggregate data supports issuing allowances
in all five years. Two commenters add together recent allowance use,
reported reclamation amounts and the change in aggregate inventory to
show an estimate of actual market demand for HCFC-22, though the
commenters believe that their servicing need calculations support a
zero allocation in 2015 and beyond. Three commenters believe EPA needs
additional inventory data to proceed with its rulemaking, but also
believe that EPA should issue zero allowances.
    The agency's goal is to phase out the production of HCFC-22 by
2020, consistent with Title VI of the CAA and the long-standing
regulatory phaseout date, not to remove all HCFC-22 from inventory by
2020. The statute does not specify the factors EPA is to consider in
setting an allocation level, other than the applicable phaseout step.
Existing inventory can be beneficial during a time of transition,
allowing equipment owners more flexibility in planning and implementing
their transition. The availability of HCFC-22 inventory after 2020
along with continued reclamation is important for allowing equipment
owners to continue using their equipment after the production phaseout.
However, EPA also recognizes that current inventory grew in 2013 and is
higher than some in industry expected, which is one of several reasons
why EPA is finalizing a 2015 allocation of 10,000 MT instead of 13,700
MT. Now that the inventory data is public, awareness as to the scale of
existing inventory should help moderate potential price spikes and
allow equipment owners to plan a thoughtful transition to alternatives.
    Several commenters appear to be confused about how EPA considered
inventory information in development of this rulemaking, as compared to
the 2012-2014 Rule that issued allowances for 2012-2014. In the
proposal covering 2012 through 2014, EPA considered the servicing need
estimates from the Vintaging Model and made reductions to that number
to derive a possible allocation that approximates the need for virgin
HCFC-22, just as in the 2010-2014 Rule. For 2012 through 2014, EPA
proposed to decrease annual allocations by 6,000 MT each year to
account for existing inventory. In the fall of 2012, the agency
estimated that inventory was between 22,700 MT and 45,400 MT, based on
preliminary market research and industry feedback. The agency finalized
the annual 6,000 MT reduction in the 2012-2014 Rule, thus lowering the
aggregate allocation for 2012-2014 compared to the 2010-2014 Rule.
EPA's intent was not to immediately deplete all inventory, as inventory
can help provide for a smoother transition out of HCFC-22, but to draw
out some of the inventory prior to 2015. In the 2015-2019 proposal, EPA
specifically proposed to account for up to 10,000 MT of inventory under
the estimation approach, which, unlike the linear approaches, is most
similar to the allocation methodology EPA used in the 2010-2014 Rule
and the 2012-2014 Rule.
    In response to comments stating that EPA must consider prevailing
market conditions and inventory held by entities from which it did not
collect data, EPA explains above its different understanding of the
role of inventory data in this rulemaking. The agency did not intend to
allocate allowances at a level that would result in inventory being
drawn down to zero immediately or even by 2020. The agency believes
that the additional expenditure of effort, particularly the information
collection burden imposed on industry, is not required to establish a
reasonable and predictable allocation level for the final five years of
the HCFC-22 phaseout.
    EPA appreciates that many commenters believe additional HCFC-22
production and import is unneeded based on their position in the
market. EPA's allocation considers the perspectives of both the end-
users that need HCFC-22 to operate their equipment and the companies
recovering and reclaiming HCFC-22, because both play an integral role
in meeting EPA's policy objective of a smooth transition from HCFC-22.
In particular, the capability of recovery and reclamation companies is
an important consideration as reclamation decreases the need for new
production, thereby allowing EPA to allocate fewer HCFC-22 allowances.
    In response to comments about potential inventory held by grocery
stores, apartment buildings, and other large end-users, EPA points out
that inventory held by a building or supermarket in preparation for a
possible leak is different from inventory in the supply chain.
Inventory held by these large end-users is refrigerant that they intend
to use, not sell. Therefore, this type of inventory is more like
refrigerant already charged into a system than inventory in the supply
chain (i.e. channel inventory) that will eventually be sold to an end-
user. Equipment owners have this refrigerant on-hand in order to keep
operating their system, whereas inventory in the supply chain is
waiting for someone to purchase it.
    Although existing stocks of HCFC-22 are important for meeting
continued servicing need, EPA recognizes that too much existing
inventory could be contrary to the agency's goal of a smooth transition
to alternatives. Proper refrigerant management and a viable reclamation
industry are also critical to a smooth transition, which is why EPA
believes that a sufficiently low allocation is needed in order to
encourage the use of some existing stocks and also to encourage--but
not immediately force--transition. The final 2015 allocation of 10,000
MT is less than one-quarter of the modeled 2015 servicing need. By
allocating well below the projected need for HCFC-22 each year, EPA is
accounting for retrofitted equipment, recovery and reuse of
refrigerant, use of reclaimed refrigerant, and existing inventory of
virgin HCFC-22, in addition to realizing the benefits of a linear
drawdown already discussed.
    Twenty-seven commenters addressed market issues related to the
supply or price of HCFC-22; most of these commenters believe the 2012-
2014 Rule led to an oversupply in the market, with adverse effects on
the reclamation and alternative-refrigerant industries. Several
commenters assert that the 2012-2014 Rule led to a 50-60 percent
decline in the price of HCFC-22 relative to the peak price reached in
2013, a decline in volume of returned used HCFC-22, a decline in
reclamation and recycling, and an increase in volume of HCFC-22 being
leaked or vented. One commenter, USA Refrigerants, states that their
organization and other EPA certified reclaimers were negatively
affected by the change in the price of HCFC-22 and the inability to
provide high buyback prices for used refrigerant, which they said
dropped to as low as $1.00 per pound. Another commenter, EIA, notes
that the price of virgin HCFC-22 in 2011 was $4.50/pound but claims
that the price needs to exceed $8/pound for reclaimed HCFC-22 to be
competitive. One distribution company reports already seeing 50 percent
less reclaimed material available to sell in 2014. On the other hand,
Polar Technologies states that its internal analysis on the market
dynamics of

HCFC-22 found no correlation between price and reclaim volume. The
commenter asserts that as prices increase, hoarding occurs and
reclamation decreases. As HCFC-22 prices jumped and supplies seemingly
were shrinking, contractors were speculating and buying up cylinders to
store material to hedge against the pending shortage.
    Three commenters make statements on investments by the reclamation
and alternative refrigerants industry. A-Gas RemTec notes that they
invested in additional capacity for reclaimed refrigerants but have
since halted this development as a result of the 2012-2014 Rule. A-Gas
RemTec notes that other entities may also question committing to
increased capacity in an unpredictable market, which could lead to a
refrigerant shortage in future years. Another commenter, Hudson
Technologies, asserts that the reclamation industry invested millions
of dollars in infrastructure, but since the supply gap never
materialized, reclamation has not grown. USA Refrigerants notes that
companies that invested in alternative refrigerants saw prices for
HCFC-22 plummet as a result of the 2012-2014 Rule, undercutting the
sale of alternatives.
    Six commenters are concerned about venting of HCFC-22, which they
believe is perpetuated by an oversupply of HCFC-22 and the
corresponding low value of the gas. Specifically, these commenters
believe that a lower (or in some cases, zero) allocation would
incentivize the use of reclaimed gas and better refrigerant management.
    The agency believes the best way to encourage reclamation, as well
as development and use of expanded reclaimer capacity, is to send a
clear market signal: A substantial decrease in allocation in 2015 with
a continued, but decreasing, allocation over all five years. Such a
signal should encourage recovery and reclamation, while also giving
equipment owners confidence that they can have access to refrigerant
for their installed HCFC-22 equipment through 2020 and beyond. The
linear drawdown starting at 10,000 MT should encourage more recycling
and reclamation, without creating such dramatic market changes as to
incentivize hoarding of used refrigerant. This approach has the lowest
allocation in 2015 and 2016 of all options discussed in the proposed
rule, which should encourage better refrigerant management practices,
while a small, decreasing allocation in later years should allow for a
smooth transition to zero in 2020. Compared to a 2014 allocation of
23,100 MT, a 2015 allocation of 10,000 MT should encourage proper
refrigerant management and more reclamation; it should also encourage
planning for a transition to alternative refrigerants without
unnecessarily forcing equipment owners to immediately abandon their use
of HCFC-22.
    The agency views its final allocation as sending appropriate
signals to the market by decreasing the HCFC-22 allowance allocation by
almost sixty percent between 2014 and 2015. Further, by providing a
predictable but declining number of allowances through 2019, the agency
believes this final rule will give HCFC-22 equipment owners the
information they need to choose between maintaining their HCFC-22
systems, retrofitting their existing systems, and purchasing new
systems that rely on alternative refrigerants. EPA intends to strike a
balance with the final allocation: A significant decrease from the 2014
allocation promotes alternatives, reclamation, and transition, while a
non-zero allocation avoids stranding HCFC-22 equipment or forcing
premature retrofits.
4. Timing of the Final Rule
    Eighteen commenters urge EPA to finalize today's action as quickly
as possible. They cite several reasons for expeditious action specific
to the HCFC-22 allocation: To allow industry to properly plan and
prepare for complying with the rule; to provide certainty and stability
for business planning; and to minimize market disruption and foster a
smoother transition during these final stages of the HCFC-22 phaseout.
One of these commenters states that EPA is not acting quickly enough.
AHRI specifically calls out the need for timely action as it relates to
the HVAC market, a major use for HCFC-22, which will transition to new
minimum energy efficiency standards on January 1, 2015. AHRI states
that uncertainty in the HCFC-22 allocation adds complexity to this
transition and that lack of knowledge regarding the HCFC-22 allocation
could be detrimental to manufactures and small business owners.
    On the other hand, RMS, New Era Group Inc., and ICOR International
comment that EPA needs to update its models or obtain more accurate
data prior to finalizing this rule. New Era Group Inc. suggests that
the proposed rule be withdrawn and the NODA republished along with
immediate steps to mitigate the serious damage to small companies,
human health, and the environment. EPA does not see a need to re-
propose or to publish another NODA. As discussed earlier in this
notice, EPA does not believe it needs to gather additional data or to
propose additional options. The agency believes the information it has
at its disposal currently is sufficient to justify the significantly
lower allocation of HCFC-22 as compared to the preferred option in the
proposal, especially since finalizing a rule this year will support
EPA's goal of a smooth transition to alternatives.
    EPA appreciates the many comments stressing the value of a timely
rulemaking in providing regulatory certainty to the market. The agency
agrees that it can best realize its goal of a smooth transition to
alternatives via a timely 2015-2019 rule, especially in the case of
HCFC-22. In addition to a timely rule, the agency and many commenters
believe a linear drawdown will also provide certainty and help
stabilize the market by setting a straightforward, predictable schedule
for the final years of the HCFC-22 phaseout.

B. What is the 2015-2019 HCFC-22 production allocation?

    Since the start of the HCFC allocation program in 2003, the agency
has determined the HCFC-22 production allocation in one of two ways.
Under either method, EPA first determines the aggregate consumption
allocation, divides by the aggregate baseline, and assigns the
percentage of the consumption baseline accordingly. EPA describes this
process in more detail in section II.B.
    In the 2003-2009 Rule, and again in the 2010-2014 Rule, EPA
allocated the same percentage of baseline allowances for production as
it did for consumption. A company with a production baseline at 40 CFR
82.17 would simply multiply its baseline by the percentage listed at
82.16 to determine its calendar-year production allocation. However, in
the 2012-2014 Rule covering 2012-2014, EPA provided a larger percentage
of baseline and more HCFC-22 production allowances than it did for
consumption. EPA amended section 82.16 to include two tables, one
listing the baseline percentage for consumption and the other listing
the percentage for production. As discussed in the 2012-2014 Rule, the
reason for this change was to allow United States manufacturers to
produce at the same level as under the 2010-2014 Rule (see 78 FR
20020).
    For the 2015-2019 regulatory period, EPA proposed two options for
the HCFC-22 production allocation: (1) Issue production allowances at
the highest allowable level under the Montreal Protocol, or (2) provide
approximately the same number of

production allowances as consumption allowances.
    EPA noted that the first approach was its preferred option. EPA
believes that allocating more production allowances than consumption
allowances cannot lead to an increase in United States consumption and
would not result in a global increase in production or consumption of
HCFC-22; all countries' consumption are capped under the Montreal
Protocol and presumably global production would be driven by market
conditions. Allocating additional production allowances may have
environmental benefits, to the extent that U.S. production displaces
production in foreign plants that lack HFC-23 byproduct controls and
destruction technologies. For more discussion on EPA's rationale for
this approach, see the preambles for the 2012-2014 Final Rule (78 FR
20020) and the 2015-2019 Proposed Rule (78 FR 78089).
    EPA received eight comments on how it will determine the HCFC-22
production allocation for 2015-2019. Comments from EIA, a private
citizen, and Hudson Technologies stated that the industry or
marketplace does not need any additional HCFC-22, and that EPA should
not issue production allowances. Additionally, EIA believes that
issuing production allowances is contrary to helping developing
countries transition to low-GWP and zero-ODP technologies through the
Multilateral Fund of the Montreal Protocol (which is the financial
mechanism to help those Parties meet their Montreal Protocol
obligations). Airgas is also against EPA's preferred option on the
grounds that more production allowances for export will lead to further
oversupply globally. Airgas believes that consumption and production
allocations should be the same and should be set at zero or minimal
levels. A private citizen supports cutting the production allocation to
encourage a shift in U.S. production of ODS alternatives for export,
instead of HCFC-22. The commenter acknowledges the importance of
considering HFC-23 byproduct emissions, but thinks it is less important
since HCFCs will be phased out globally.
    DuPont and Honeywell commented in favor of EPA's proposal to
allocate the maximum HCFC-22 production allowed under the Protocol
after accounting for other HCFC production allocations. The commenters
believe that more production for export could allow production from
U.S. facilities to displace production from facilities abroad that may
not control HFC-23 emissions, thus providing environmental benefits and
reductions in GHG emissions. The commenters reference EPA's prior
statements that allowing for additional U.S. production for export
could not result in a domestic or global increase in consumption since
HCFC producers are already limited by consumption allowance limits
established under the Montreal Protocol. A third commenter supported a
production allocation that is higher than allowed under the Montreal
Protocol, starting at 25 percent of U.S. HCFC production baseline in
2015 (whereas the Montreal Protocol cap is 10 percent of baseline for
all HCFCs).
    In response to the five adverse comments on EPA's preferred option,
the agency points out that allocating more production allowances than
consumption allowances does not provide United States producers the
opportunity to exceed their consumption allocation. Production of one
kilogram of an HCFC still requires both a production allowance and a
consumption allowance (82.15(a)(1), (2)). Allocating more production
allowances than consumption allowances would provide United States
producers the opportunity to continue production for export subject to
existing regulatory constraints. A company must submit documentation to
verify the export of an HCFC for which consumption allowances were
expended in order to request a reimbursement of spent consumption
allowances. The agency reviews the documentation and issues a notice to
either deny or grant the request. Therefore, a company would not be
able to produce more HCFC-22 unless it had exported an equal amount of
material and been granted a refund of spent consumption allowances. To
the extent that commenters support a lower production allocation to
address concerns about U.S. consumption, EPA responds to those comments
in Section VI.A. of this preamble.
    In response to concerns about an increase in global consumption,
EPA explained in the 2015-2019 Proposed Rule that allowing United
States production allocation to be higher than the consumption
allocation could not result in increased global consumption. Providing
more production than consumption allowances could allow companies to
continue exporting to non-Article 5 countries, which have the same
overall Montreal Protocol phaseout schedule as the United States but
may not use the United States' chemical-by-chemical approach to phasing
out HCFCs. Also, consumption of HCFCs in Article 5 countries was capped
starting in 2013, which further limits global HCFC-22 demand (see
Montreal Protocol Art. 5, para. 8 ter.). Finally, at least one company
holding production allowances does not produce HCFC-22 in the United
States; therefore, it is unlikely that every production allowance
issued will be used.\23\ EPA is concerned that the alternative
approach--issuing production allowances at the same level as
consumption, instead of at the maximum level allowed under the cap--
reduces flexibility for industry without a benefit to the environment.
---------------------------------------------------------------------------

    \23\ Data submitted to the Greenhouse Gas Reporting Program on
byproducts of the HCFC-22 production process indicate that only
three of the four companies holding production allowances actually
produced HCFC-22 in 2010, 2011 and 2012. While the non-producing
allowance holder can transfer its allowances to another producer,
the fact that they do not produce in the U.S. makes it unlikely that
all calendar-year production allowances will be used.
---------------------------------------------------------------------------

    EPA disagrees with EIA's comment that issuing production allowances
is contrary to helping developing countries transition to low-GWP and
zero-ODP technologies through the Multilateral Fund of the Montreal
Protocol. The U.S. is committed to helping Article 5 Parties transition
to non-ODP and low-GWP alternatives via the Multilateral Fund. Since
HCFC consumption in Article 5 Parties was only capped starting in 2013,
and because those Parties still have servicing needs for HCFC-22 in
existing equipment, EPA does not see HCFC-22 exports during 2015
through 2019 as contrary to the goals of encouraging a transition to
alternatives. Given that Article 5 countries are not required to
completely phase out HCFCs until 2040, it is expected that demand for
HCFC-22 will continue while low-GWP alternatives are developed and
deployed to replace existing HCFC technologies.
    As mentioned previously, EPA also believes that allocating more
production allowances than consumption allowances could have
environmental benefits if United States production displaces production
at facilities that do not control byproduct emissions of HFC-23, which
has a global warming potential of 14,800.\24\ Comments on the 2015-2019
proposal cited the growth of HFC-23 emissions globally and indicated
that facilities in Article 5 countries do not control HFC-23 emissions
to the same degree as companies operating in the United States. EPA has
historically worked with industry through its HFC-23

Emission Reduction Partnership to encourage companies to reduce HFC-23
byproduct emissions from the manufacture of HCFC-22. For further
discussion see the 2015-2019 Proposed Rule at 78 FR 20021.
---------------------------------------------------------------------------

    \24\ GWP of HFC-23 presented in the Intergovernmental Panel on
Climate Change (IPCC) Fourth Assessment Report: Climate Change 2007
(AR4)
---------------------------------------------------------------------------

    Based on the consideration of the comments, and for reasons
discussed here, EPA is issuing the maximum number of HCFC-22 production
allowances allowed under the Montreal Protocol cap, after accounting
for production allocations of all other HCFCs provided under this rule.
Starting in 2015, the United States production cap under the Montreal
Protocol is 1,553.7 ODP-weighted MT. The final production allocations
for HCFC-124 and HCFC-142b are 4.4 and 2.3 ODP-MT, respectively (see
VI.E and VI.C, respectively), leaving the remainder of the cap
available for HCFC-22 production. For 2015-2019, EPA is issuing 21.7%
percent of HCFC-22 production baseline, which is approximately 28,000
MT of HCFC-22, as shown in the regulatory text at 82.16(a).
    To put the 2015 cap in historical perspective, EPA issued 41,200 MT
of HCFC-22 production allowances in 2013, 36,000 MT in 2014, and is
only issuing 28,000 MT of HCFC-22 production allowances for each year
from 2015-2019.

C. What is the 2015-2019 HCFC-142b consumption and production
allocation?

    The 2010-2014 Rule allocated 100 MT of HCFC-142b consumption
allowances annually. When EPA re-established HCFC-22 and HCFC-142b
baselines in the 2011 Interim Final Rule and 2012-2014 Rule, the HCFC-
142b consumption allocation remained at 100 MT. Because the HCFC-142b
production baseline was significantly higher than the consumption
baseline, and the same percentage of baseline was used for both
consumption and production, the production allocation became 463 MT per
year in 2011-2014.
    As discussed in the proposed rule, several HCFC manufacturers
anticipate continued, albeit decreasing, sales of refrigerant blends
containing HCFC-142b in 2015 and later. HCFC-142b is predominantly used
in refrigerant blends that have historically served as replacements for
CFC-12 and R-500 in medium- and large-sized refrigeration equipment.
Some of these blends containing HCFC-142b, particularly R-409A, are in
use today, but in small quantities. Because the volumes are very small,
EPA does not model servicing need for equipment using these HCFC-142b
blends. Refrigerant sales data collected by the California Air
Resources Board,\25\ along with industry feedback, confirm that there
is some R-409A equipment still in use. For this reason, EPA proposed to
allocate 35 MT of consumption allowances in 2015 with a decrease of 5
MT each year through 2019.
---------------------------------------------------------------------------

    \25\ See Preliminary 2011 and 2012 Sales and Distribution Data
from the California Air Resources Board's Refrigerant Management
Program in the docket.
---------------------------------------------------------------------------

    As stated in the proposed rule, a consumption allocation of 35 MT
in 2015 is an appropriate balance between the 2010-2014 allocation of
100 MT, the actual consumption of HCFC-142b in recent years, and the
reasonable assumption that R-409A is used mainly in retrofitted
equipment designed for CFCs that is nearing expected retirement. With
an annual decrease of 5 MT, the HCFC-142b allocation would be 15 MT in
2019 before going to zero in 2020. A decreasing allocation sends a
stronger market signal that production and import of HCFC-142b are
ending, as compared to a constant allocation in all five years. Such a
signal will help encourage equipment owners to transition to equipment
that uses non-ODS refrigerants, while also providing them with an
opportunity and time to select alternatives that are more energy
efficient. EPA is finalizing its proposed consumption allocations of 35
MT in 2015, 30 MT in 2016, 25 MT in 2017, 20 MT in 2018, and 15 MT in
2019. HCFC-142b consumption and production in 2020 will be zero based
on EPA's chemical-by-chemical phaseout rule (58 FR 65018).
    For production, EPA proposed issuing HCFC-142b production
allowances at the same level as consumption, not the same percentage of
baseline. Unlike HCFC-22 production, historic exports of HCFC-142b do
not indicate a need for additional production allowances to meet export
demands. EPA stated that it would consider issuing up to 100 MT of
production allowances, even if the final consumption allocation is
lower, if there is documented need for United States-produced HCFC-142b
in other non-Article 5 countries; however, the agency has not received
any such documentation. In this rule, EPA is finalizing its preferred
allocation of 35 MT of HCFC-142b production allowances, decreasing by 5
MT per year through 2019.
    EPA received five comments related to how it will determine the
HCFC-142b allocation. Three comments support EPA's proposal to allocate
35 MT of HCFC-142b consumption allowances in 2015 with a decrease of 5
MT each year. Three commenters support EPA's proposal to issue
production allowances at the same level as consumption, asserting that
a lower percentage would discourage U.S. production and harm the U.S.
economy. One commenter, Arkema, requests that EPA make the percentage
allocations for HCFC-142b production allowances the same as the
proposed percentage for consumption allowances, which would result in a
higher absolute number of production allowances. As proposed, the rule
would provide 35 MT of total production allowances, but for some
companies, their production allowances would be much lower than their
consumption allowances. Arkema argues that an individual company
receiving fewer production allowances than consumption allowances would
discourage U.S. production of HCFC-142b, resulting in both
environmental and economic consequences. Another commenter, CIP, stated
during the January 2014 public hearing on the proposed rule that they
support issuing HCFC-142b allowances only through 2017 (instead of
2019) to enhance good handling, emissions control, and enforcement.
    While one commenter recommends going to a three-year approach that
stops providing consumption allowances for HCFC-142b in 2018, EPA did
not propose that option and believes it may be too rapid for many of
the same reasons EPA is not finalizing the 3-year approach for HCFC-22.
A three-year approach would be contrary to long standing market
expectations and EPA's goal of allowing equipment owners to realize the
intended life of their equipment and plan a smooth, thoughtful
transition to alternatives.
    For production allowances, EPA does not agree that the percent
allocations for consumption and production should be the same. The
production baseline for HCFC-142b is substantially larger than the
consumption baseline because of the baseline transfers made in 2008 and
2009. While one company transferred an equal number of its HCFC-142b
baseline consumption and production allowances, a second company did
not. As a result, the number of aggregate baseline consumption
allowances is about 1/5th the number of aggregate baseline production
allowances. Using the same percentage of baseline for HCFC-142b
production as for consumption would result in more production
allowances than consumption allowances. As discussed above, historic
exports of HCFC-142b do not indicate a need for additional production
allowances to meet export demands. For more history on these

trades, see previous HCFC allocation proposed and final rules available
at 76 FR 47451, 77 FR 237, and 78 FR 20004.
    To address the commenter's concern that an individual company might
not have the desired number of production allowances, EPA notes that it
is allocating more HCFC-22 production allowances than consumption
allowances. HCFC-22 production allowances can easily be transferred
into HCFC-142b production allowances on a calendar-year basis.
Alternatively, HCFC-142b allowance holders can seek to transfer
allowances from another HCFC-142b production allowance holder to their
company. Finally, EPA has allocated up to 10 percent of baseline in
Article 5 production allowances that can be used to export
domestically-produced HCFC-142b. Because of these flexibilities, EPA
does not see a need to allocate additional HCFC-142b production
allowances and is finalizing its proposed HCFC-142b production
allocation of 35 MT in 2015, decreasing by 5 MT per year through 2019.

D. What is the 2015-2019 HCFC-123 consumption allocation?

    HCFC-123 is currently used as a refrigerant and as a fire
suppression agent, which are the two uses of non-feedstock virgin HCFCs
permitted by section 605(a) of the CAA as of January 1, 2015. The
agency proposed to issue consumption allowances to allow import for
these two uses. For the 2010-2014 regulatory period, EPA issued
approximately 2,500 MT of HCFC-123 consumption allowances each year,
which is 125% of the HCFC-123 consumption baseline. EPA has never
established a production baseline for HCFC-123, and the agency has no
record of domestic production of HCFC-123 for refrigeration or fire
suppression uses during the baseline years (2005-2007).
    As stated in the proposal, section 605(b) of the Clean Air Act
restricts production of any class II substance to 100% of baseline
levels or less beginning on January 1, 2015. Section 605(c) requires
that consumption of class II substances be phased out on the same
schedule as production. The agency's reading of 605(b) and 605(c)
together is that as of January 1, 2015, EPA may allocate no more than
100 percent of baseline for production or consumption of each class II
substance. This milestone is part of the phaseout schedule contained in
the CAA. EPA has accelerated the section 605 phaseout schedule for some
HCFCs under the authority of section 606. Nevertheless, the 2015
milestone in section 605(b) is still relevant because it applies to
each class II substance individually. This is in contrast to the basket
approach contained in the Montreal Protocol. Under section 614(b),
where there is a conflict between Title VI of the CAA and the Montreal
Protocol, ``the more stringent provision shall govern.'' With respect
to individual substances, section 605 is more stringent. Thus, for the
2015 control period and beyond, EPA may not allocate more than 100
percent of baseline for any class II substance.
    Under the current phaseout regulations, beginning in 2015,
production and import of HCFC-123 is limited to servicing of existing
refrigeration and air conditioning equipment only. In this rule, EPA is
finalizing revisions to section 82.16(d) to allow production and import
of HCFC-123 for non-residential, streaming fire suppression
applications to complement section 605(a)(4) of the CAA (see section
IV.B.3.) This exemption will end on December 31, 2019, because
beginning in 2020, Article 2F of the Montreal Protocol restricts
production and import of HCFCs to servicing of existing refrigeration
and air conditioning equipment.\26\ While virgin HCFCs can continue to
be used in fire suppression applications, EPA does not intend to issue
consumption allowances for fire suppression after 2019 because of this
Montreal Protocol requirement. In addition, beginning January 1, 2020,
section 605(a) of the CAA prohibits the use of virgin class II
substances in the installation and/or manufacture of air conditioning
and refrigeration systems. Any HCFC-123 consumption allowances issued
after 2019 would only allow import of HCFC-123 for use as a refrigerant
for servicing systems manufactured prior to January 1, 2020.
---------------------------------------------------------------------------

    \26\ Use of HCFC-123 that was imported prior to 2020, or that is
used, recovered and recycled, is still allowed for use in fire
suppression beyond January 1, 2020.
---------------------------------------------------------------------------

    EPA's understanding is that much of the HCFC-123 refrigerant use
today is to service and manufacture low pressure chillers. Given the
expectation that these chillers can last for more than 20 years, EPA
sought comment on whether it should provide a static amount of HCFC-123
allowances through 2019 at the maximum amount allowed by the CAA (100
percent of baseline), or whether it should begin to gradually reduce
HCFC-123 allowances now to foster transition. EPA stated that it
preferred to issue 100 percent of the HCFC-123 baseline. This approach
would be consistent with the way EPA allocated HCFC-22 and HCFC-142b
allowances prior to the 2010 prohibition on manufacturing new HCFC-22
and HCFC-142b appliances.
    In considering allocation options, EPA looked at the projected need
for virgin HCFC-123 for refrigeration and nonresidential fire
suppression uses. EPA's modeled need for each of these uses is
presented in the 2013 Servicing Tail Report. In the proposed rule, EPA
sought comment on the remaining refrigerant and fire suppression uses
of HCFC-123, how much is needed, and why non-ODS alternatives could not
meet this need. Based on data provided during the comment period, EPA
provides an updated projection of HCFC-123 need in the 2014 Servicing
Tail Report.
    EPA received nine comments regarding its proposed options for
issuing HCFC-123 consumption allowances. Four commenters support EPA's
preferred option to allocate 100 percent of the HCFC-123 consumption
baseline. Two of these commenters assert that there is no commercially
available alternative to replace HCFC-123 in low-pressure centrifugal
chillers, and one commenter noted that its HCFC-123 alternative
development strategy is based on the existing date of transition (2020)
and requires significant chiller redesigns. One commenter believes that
100 percent allocation is necessary to support new chillers and those
to be serviced in the future, and that allowing continued HCFC-123
allowances may prevent global warming because competitors' products
typically use HFC-134a (which has a higher GWP than HCFC-123). One
other commenter states that there is no need to decrease the allowances
over time to ensure a smooth transition as the EPA will have the
opportunity to issue allowances post 2019 to allow for servicing of
existing equipment.
    In an attachment to its comments, AMPAC makes the case for
continued HCFC-123 production in 2020 and beyond, requesting that EPA
consider an updated ODP of 0.0098 for the purposes of ``analysis of
environmental impact.'' This same commenter urged EPA to consider
increasing the HCFC-123 allocation to 120 percent of baseline to
provide flexibility in the market and benefits to users and the
environment. The commenter states that their projected need for HCFC-
123 allowances for nonresidential fire suppression is more than what is
proposed in EPA's preferred allocation and the increased allocation
they are recommending still falls well under the Montreal Protocol cap.
Specifically, AMPAC believes that within section 605(b) and 605(c),
there could be EPA

discretion, subject to meeting the HCFC cap, to increase the
consumption allowance allocations for HCFC-123 in 2015-2019 beyond the
values found in the baseline years (2005-2007). The commenter finds
that exercising this discretion is appropriate given that the highest
contemplated level of planned allocation of HCFC-22 allowances in the
Proposed Rule still results in the U.S. being well below the Montreal
Protocol cap. AMPAC also requests that EPA increase HCFC-123 allowances
for 2015-2019 by 100 MT to account for higher than initially cited use
for fire suppression.
    Five other commenters state that EPA's preferred HCFC-123
allocation is too high. Three of these commenters believe that EPA's
justification for its preferred allocation is deficient because
commercially-viable alternatives exist for HCFC-123 in centrifugal
chillers, such as Solstice-1233zd(E) (trans-1-chloro-3,3,3-
trifluoroprop-1-ene) and HFC-134a. One commenter also noted that they
have a chiller using HFC-134a that surpasses industry standards for
energy efficiency. This commenter also believes that EPA has made no
effort to encourage the development and use of alternatives for HCFC-
123. Another commenter believes that EPA has given preferential
treatment to an ODS that favors one manufacturer in the air
conditioning business. Two other commenters support an allocation of
less than 100 percent of the consumption baseline to account for
recovery and recycling.
    The isomer of HCFC-123 that is primarily used in fire suppression
has an ODP of 0.02 under long-standing CAA regulations \27\ and a GWP
of 77. While EPA is aware of studies showing a lower ODP for HCFC-123,
the specific ODP used for HCFC-123 does not affect the section 605(b)
and (c) requirement to limit the production and consumption of each
class II substance to at most 100 percent of baseline starting in 2015.
The baseline is not ODP-weighted, so a change in the ODP would not
change the amount that EPA could allocate. Additionally, the Montreal
Protocol uses an ODP of 0.02, so EPA will continue to use that value.
HCFC-123 has a lower GWP than some of the refrigerant alternatives
available (e.g. HFC-134a with a GWP of 1,430). However, compared to a
recently SNAP-listed alternative, Solstice-1233zd(E), HCFC-123 has both
a higher ODP (0.02 vs. 0.00024-0.00034) and a higher GWP (77 vs. 4.7-
7). Of note, Solstice-1233zd(E) equipment is still being
commercialized, but should be available in the future.
---------------------------------------------------------------------------

    \27\ See Appendix B to 40 CFR Part 82 Subpart A.
---------------------------------------------------------------------------

    EPA is not attempting to favor any type of equipment or any
specific company with this allocation as some commenters have
suggested. EPA does not have control over the number of manufacturers
that use a particular chemical in their equipment. The agency is merely
attempting to meet needs for HCFC-123 that are consistent with market
projections, while also encouraging transition and the development of
non-ODP and low-GWP alternatives.
    Several commenters indicated that allocating 100 percent of
baseline is counter to how the agency has handled other HCFCs. In
response, EPA notes that handling HCFC-22 and HCFC-142b differently
from HCFCs with lower ODPs has been a long-standing agency policy.
While EPA could have accelerated the phaseout schedule for HCFC-123 as
it did for HCFC-22 and HCFC-142b, it did not. In the 1993 proposed
rule, EPA stated that ``no change to the statutorily specified
timetable would be imposed on HCFC-123 [. . .] because of [its]
substantially shorter lifetime[] and lower ODP[],'' (58 FR 15027). EPA
continues to believe this logic is appropriate for the HCFC-123
allocation during the 2015-2019 time period. The agency is finalizing a
consumption allocation of 2,000 MT, which is 100 percent of baseline,
for the years 2015-2019.
    Additionally, allocating 100 percent of baseline is consistent with
how EPA handled the allocations of HCFC-22 and HCFC-142b prior to 2010.
As of January 1, 2010, it became illegal to use virgin HCFC-22 or HCFC-
142b in the manufacture of a new appliance. In 2003-2009, EPA allocated
100% of the HCFC-22 and HCFC-142b baselines right up until the
prohibition on use in manufacturing took effect. In this final rule,
EPA is taking similar action with HCFC-123 by allocating 100 percent of
baseline up until the January 1, 2020, ban on using virgin HCFC-123 in
the manufacture of appliances takes effect.
    There is one important difference between how EPA is allocating
allowances for HCFC-123 compared to HCFC-22 and HCFC-142b. In 2003-
2009, EPA allocated more HCFC-22 and HCFC-142b consumption than
estimated market need. In this rule, EPA is allocating fewer HCFC-123
consumption allowances than the amount of estimated market need.
Allocating below EPA's estimate for market need, combined with the 2020
ban on the manufacture of new HCFC-123 appliances, should provide
incentive to recover and recycle used refrigerants, as well as to
transition to alternative non-ODS refrigerants, all while meeting
anticipated market need.

E. What is the 2015-2019 HCFC-124 consumption and production
allocation?

    The primary use of HCFC-124 beginning January 1, 2015, will be in
refrigerant blends. Though HCFC-124 has sterilant and fire suppression
applications that are listed as acceptable under the SNAP program, EPA
is adopting only a narrow de minimis exemption to the CAA section
605(a) use prohibition for the use of virgin HCFCs as sterilants, and
there are no remaining commercial applications of HCFC-124 fire
suppression products. Several refrigerant blends with HCFC-124 are
listed as acceptable by the SNAP program: R-401A, R-401B, R-409A, R-
414A, R-414B, R-416A and others. Given EPA projected some continued use
of certain refrigerant blends containing HCFC-124, the agency proposed
to issue HCFC-124 allowances in 2015-2019. As mentioned in the
proposal, the Servicing Tail Report likely does not capture all current
uses of HCFC-124 refrigeration equipment.
    EPA proposed to allocate both consumption and production at the
level of 200 MT. However, the agency requested comments on a lower
allocation of as few as 4 MT of HCFC-124 consumption and production
allowances, consistent with the Servicing Tail Report projections.
While not the preferred allocation, EPA said it would consider a lower
allocation if commenters could provide evidence that the allocation
should be that low. Similarly, EPA requested data from commenters in
support of allocating up to 400 MT of HCFC-124 consumption and
production allowances. The agency also sought comment on the transition
or retrofit plans of equipment owners, and for how long they expect to
need virgin HCFC-124.
    The agency received five comments about the HCFC-124 allocation.
Two companies support EPA's proposal to allocate 200 MT of production
and consumption allowances; one of these commenters believes that 200
MT of consumption and production allowances would allow for continued
use of refrigerants containing HCFC-124 while limiting the growth of
this market as the industry transitions to non-ODS refrigerants. One
commenter believes the agency failed to account for exports in their
allocation, and thus allowances should be either 400 MT for production
and 200 MT for consumption or 400 MT for both production and
consumption, if the agency prefers to allocate the same

quantity of production and consumption allowances.
    Two commenters do not support the proposed allocation. EIA asserts
that EPA's proposal is not based on real demand. EIA states that if the
major use for HCFC-124 is as a sterilant blend that will be banned
under the CAA in 2015, and the estimated need from the Vintaging Model
is so low, without taking into account recovery and reuse of any of the
refrigerant nor potential stockpiles, there is no reason to allocate
any more production or consumption. NRDC commented that HCFC-124
allowances should not be set higher than 4 MT per year--i.e., the level
estimated by the Vintaging Model--to foster markets in recycling and
safer alternatives.
    Commenters opposed to EPA's preferred allocation of 200 MT cite the
Servicing Tail Report and the prohibition on the use of HCFC-124 as a
sterilant, combined with the need to encourage recovery and
reclamation, as justification for a lower allocation. As EPA stated in
the proposal, niche refrigerant blends with low servicing need, like R-
409A, are not typically modeled. R-409A is predominantly used as a
replacement for CFC-12 and R-500 in medium- and large-sized
refrigeration equipment. Included in the docket with the proposed rule
is Preliminary 2011 and 2012 Sales and Distribution Data from the
California Air Resources Board's Refrigerant Management Program. This
document shows that in California alone, the amount of HCFC-124
included in blends sold in 2012 totaled more than 40 MT--well above the
amount modeled in the Servicing Tail Report. If use were proportional
to population, a California value of 40 MT would imply approximately
330 MT of HCFC-124 for the entire U.S. in 2012.\28\ This level would
then be expected to decrease by 2015; a linear decrease from 2012 to
zero in 2020 would bring this amount to 206 MT in 2015. Based on these
data and comments from stakeholders, allocating an amount lower than
200 MT for consumption throughout the entire U.S. may not meet the
servicing need for equipment containing HCFC-124 refrigerant blends.
EPA notes that 200 MT is a greater than 90 percent reduction from the
2014 consumption and production allocation levels for HCFC-124. For
reference, the 2014 consumption and production allocations are roughly
3,000 MT and 5,000 MT, respectively.
---------------------------------------------------------------------------

    \28\ Population data from http://www.census.gov/popest/data/state/totals/2013/index.html.
---------------------------------------------------------------------------

    One commenter also requests that EPA increase production allowances
to allow for export of HCFC-124. After reviewing recent export data to
both Article 5 and non-Article 5 countries, EPA concludes the preferred
allocation of 200 MT of production, combined with Article 5 allowances,
should provide an adequate amount of flexibility. Article 5 allowances
for HCFC-124 will be approximately 400 MT in 2015-2019, ten percent of
the aggregate HCFC-124 production baseline. If additional production
allowances are needed to allow for export, companies can transfer HCFC-
22 production allowances into HCFC-124 production allowances or Article
5 allowances for HCFC-22 into Article 5 allowances for HCFC-124. As
discussed in Section VI.B of the preamble, EPA is allocating a greater
number of HCFC-22 production allowances than HCFC-22 consumption
allowances.
    Based on industry feedback and public comments on the needs and
uses of HCFC-124, and the use of HCFC-124 consumption allowances in
recent years, EPA is finalizing its proposal to allocate 200 MT of
HCFC-124 consumption and production allowances each year between 2015
and 2019. EPA's goal is to ensure that servicing needs can be met,
while also encouraging recovery and reuse or transition to non-ODS
refrigerant blends. An allocation of 200 MT supports this goal.

F. How is EPA addressing the end of the HCFC-141b exemption program?

    The HCFC-141b exemption program has been in place since the start
of the HCFC allowance program in 2003. In the preamble to the 2010-2014
Rule, EPA stated that the petition process for HCFC-141b exemption
allowances at 40 CFR 82.16(h) would end in 2015, since HCFC-141b is not
used as a refrigerant and thus does not meet the criteria established
by section 605(a) for continued use. HCFC-141b similarly is not used as
a fire suppression agent and therefore would not be covered by the
recent modification to CAA section 605(a). EPA proposed to remove the
HCFC-141b petition process from 40 CFR 82.16(h) effective January 1,
2015.
    EPA received only one comment on HCFC-141b. The commenter supports
EPA's proposal to remove the petition process from the regulations,
thereby eliminating unnecessary use of HCFC-141b and facilitating a
smooth transition to alternatives. The agency is finalizing its
proposal to remove the petition process for HCFC-141b exemption
allowances at section 82.16(h) from the regulations and is terminating
the HCFC-141b exemption allowance program, effective January 1, 2015.

G. Other HCFCs That Are Class II Controlled Substances

    EPA has not established baselines or issued allowances for the
production or import of HCFCs that are not included in the tables at 40
CFR 82.16(a). The prohibitions in 40 CFR 82.15(a) and (b) on production
and import without allowances do not apply to such HCFCs. However, the
phaseout schedule in 40 CFR 82.16 applies to all class II substances,
whether or not they are governed by the allowance system. Similarly,
all class II substances are subject to the restrictions on introduction
into interstate commerce and use contained in 40 CFR 82.15(g). HCFCs
that EPA has listed as class II controlled substances are identified in
appendix B to subpart A.
    Beginning January 1, 2015, the use of all class II substances is
banned, unless specifically exempted (see section IV.B. of this
preamble for more details). EPA sought comment on whether any of the
HCFCs not governed by the allowance system qualify for the
nonresidential fire suppression and/or refrigeration servicing
exemptions and what quantity the market would need going forward for
these purposes. Should the need for any of these chemicals grow, EPA
would consider establishing baselines and allocating calendar-year
allowances via a separate rulemaking. EPA received no comments on the
production, import, or use of HCFCs not governed by the allocation
system.
    Also, as proposed, EPA is amending the list of class II controlled
substances in appendix B of subpart A to better match the lists in
Clean Air Act section 602 and the Montreal Protocol (Group I, Annex C).
Both the Protocol and CAA section 602 include all isomers of listed
substances, but 40 CFR part 82, subpart A, appendix B has not included
all isomers, only those that are specifically named (e.g., HCFC-141b is
listed as such, but there are other isomers of HCFC-141b, namely HCFC-
141 and HCFC-141a, that are not included in appendix B).
    CAA section 602 states that EPA ``shall publish'' a list of class
II substances that shall include the specified HCFCs and ``shall also
include the isomers'' of those substances. EPA's intent was to list all
isomers in appendix B, as indicated by the footnote explaining that
when a range of ODPs is listed for a chemical, the range applies to an
isomeric group. EPA proposed a change to correct this omission and did
not receive any adverse comment. Therefore, EPA is reconciling the

statutory and Montreal Protocol lists with the list in the regulations
by adding a footnote to 40 CFR part 82 subpart A appendix B stating
that the appendix includes all isomers of a listed chemical, even if
the isomer itself is not listed on its own.

VII. Other Adjustments to the HCFC Allocation System

A. What is EPA's response to comments on dry-shipped HCFC-22 condensing
units?

    Condensing units are a type of component in split system air
conditioners. Under current regulations, the sale or distribution of a
condensing unit pre-charged with HCFC-22 is prohibited (40 CFR 82
subpart I); however, a dry-shipped unit may be sold and used to repair
an existing system that uses HCFC-22 as the refrigerant. In February
2011, the Carrier Corporation sent a letter to EPA asking the agency to
ban this particular type of repair. In the proposed rule providing
2012-2014 HCFC-22 allocations (77 FR 237, January 4, 2013), EPA took
comment on whether repairs using dry-shipped condensing units affect
the phaseout of HCFC-22. The agency received numerous comments, and
responded to them in the 2012-2014 Rule. While many comments discussed
dry-shipped condensing units, very few provided EPA any additional data
or information to indicate that repairs using condensing units affect
the HCFC phaseout. In the proposed rule to today's action the agency
again sought quantifiable information on the number of dry-shipped
condensing units being shipped, whether they are being used as a repair
in lieu of a compressor or motor replacement, and whether and to what
extent condensing unit replacements extend the life of an existing
system. Most comments focused on the merits of banning or not banning
the manufacture, sale, or installation of dry-shipped condensing units.
That action is beyond the scope of this rulemaking. While EPA did not
propose a ban on dry-shipped condensing units in the 2015-2019
proposal, the agency is summarizing and responding to comments on dry-
shipped units in the Response to Comments found in the docket.
    EPA's purpose in requesting comment on this topic was to gain
additional data. Since the agency did not receive quantifiable data,
particularly on the number of dry-shipped HCFC-22 condensing units
shipped in the past several years, EPA intends to exercise its
authority under CAA section 114 to collect additional information in
order to confirm shipment trends between January 1, 2008, and January
1, 2015. After reviewing this data, EPA intends to consider whether
additional regulatory action is appropriate to meet the goals of CAA
Title VI.

B. How is EPA treating requests for additional consumption allowances
in 2020 and beyond?

    The regulations at 82.20(a) allow a person to obtain consumption
allowances equivalent to the quantity of class II controlled substances
that the person exported during the control period, provided that the
substances were originally produced or imported with consumption
allowances. The exporter must submit certain information to EPA which
the agency reviews before either granting or denying the request for
additional consumption allowances. Historically, a person could submit
this request (known as a Request for Additional Consumption Allowances,
or RACA) upon export of any HCFC for which consumption allowances were
originally expended, regardless of what control period the production
or import took place.
    EPA proposed to modify the RACA regulations in light of the
approaching phaseout deadlines for certain HCFCs. For example, consider
1,000 kg of HCFC-22 that is produced in 2019 using consumption and
production allowances. Under the previous regulations, in 2020 or
later, that material could be exported and that exporter would have
been eligible to request 1,000 additional HCFC-22 consumption
allowances. However, there will not be any consumption allowances for
HCFC-22 in 2020 or subsequent years. Therefore, the agency proposed to
clarify the RACA regulations.
    Specifically, EPA proposed to add the requirement that both the
export and the request for additional consumption allowances must occur
in a year in which consumption allowances were issued. Such clarifying
language about RACA eligibility already exists for class I controlled
substances. EPA did not receive any adverse comments on this
clarification and is finalizing the proposed text at 82.20(a).
    The agency did receive one comment from the Alliance for
Responsible Atmospheric Policy supporting EPA's proposal to not issue
any additional consumption allowances after consumption of a particular
chemical has been entirely phased out. The Alliance also stated that it
supports requiring the export of HCFCs and the request for additional
consumption allowances to occur in the same year as the consumption
allowances were expended. EPA is clarifying here that use of
consumption allowances to produce or import HCFCs may still occur in
one year, with export and the RACA occurring in a subsequent year, so
long as export and the RACA occur in a year prior to the complete
phaseout of that particular HCFC.

C. What is EPA's response to comments on maximizing compliance with
HCFC regulations?

    In the proposed rule, EPA requested comments and suggestions for
ensuring compliance with HCFC regulations. The 2015 stepdown and the
approaching phaseout of HCFC-22 may affect prices, which could increase
the incentive for illegal activity, particularly illegal imports of
HCFCs or HCFC blends. On the other hand, the agency believes that
reduced allocations and market changes increasing the value of the
material will encourage proper recovery and decrease motivation to vent
HCFCs, especially HCFC-22. EPA sought comment on how it could alter
existing regulations to encourage compliance with the HCFC phaseout
requirements and section 608 refrigerant regulations. In addition, the
agency was interested in ways it could increase awareness and ensure
compliance with the section 605(a) use restrictions and the section 611
labeling requirements that will begin in 2015.
    EPA received nine comments providing suggestions on how the agency
can maximize compliance with HCFC regulations. Several commenters
suggested increased educational efforts on regulatory requirements and
the consequences of non-compliance for distributors, contractors, and
homeowners. Other commenters asserted that the best way to maximize
compliance is to bolster the reclamation industry.
    Two commenters noted the importance of addressing illegal trade,
especially as the availability of HCFC-22 declines. One commenter
suggested increasing the efficiency of the current import and export
documentation practices by either requiring electronic transfer/
acceptance of documents prior to shipments arriving at the port/border
or by creating a license system for HCFC imports similar to what
already exists in some countries.
    Other suggestions for maximizing compliance with HCFC regulations
include: Implementing additional recordkeeping requirements for
contractors, similar to those of system owners; reducing leak rate
requirements from the current 35% per year and reducing the size of the
systems subject

to recordkeeping and leak rate requirements to below 50 lbs.; returning
to the excise tax that was used for CFCs during its phaseout;
establishing a system for regulating the venting of appliances and
residential units during maintenance and installation; and enforcing a
fixed price support that can provide incentives to contractors for
recovery and provide stability and sufficient volume to support the
reclamation industry.
    EPA appreciates stakeholders' thoughts on ways to maximize
compliance with the HCFC regulations. With respect to educational
materials, EPA has several guidance documents and FAQs on HCFC-22 on
its Web site at: http://www.epa.gov/ozone/title6/phaseout/classtwo.html, as well as guidance on labeling requirements, found in
the docket and at: http://www.epa.gov/ozone/title6/labeling. In
addition, EPA has a list of previous enforcement actions on its Web
site at: http://www.epa.gov/ozone/enforce. The agency also encourages
stakeholders to share any of this information with their clients,
members, or fellow industry stakeholders.
    The agency also is committed to preventing illegal trade of HCFCs,
and works closely with colleagues at Customs and Border Protection
(CBP), as well as Homeland Security Investigation (HSI). In addition,
EPA is participating in the greater International Trade Data System
(ITDS) initiative to leverage the benefits of a single-window Automated
Commercial Environment (ACE). The transition to broker import filings
in ACE is expected to play an important role in EPA's ability to
proactively examine data associated with imports of HCFCs. For more
information see http://www.itds.gov/xp/itds/toolbox/background/background.xml and CBP's Federal Register Notice from December 2013 on
the ODS ITDS pilot (78 FR 75931). Under this pilot, ``pre-approved
importers'' will be automatically checked and their imports released.
This helps ensures compliance with import regulations, while expediting
the import process. EPA notes the greater ITDS efforts should address
some of the issues raised by the commenter suggesting EPA restructure
the import and export documentation requirements.
    The agency is appreciative of the other recommendations submitted
by commenters and will consider whether it is appropriate for the
agency to take additional regulatory action.

VIII. Modifications to Section 608 Regulations

    The portion of the stratospheric ozone regulations titled Recycling
and Emissions Reduction (40 CFR part 82 subpart F) contains
requirements promulgated under CAA section 608. The requirements under
section 608 are intended to reduce emissions of class I and class II
refrigerants and their substitutes to the lowest achievable level by,
among other things, designing standards for the use of refrigerants
during the service, maintenance, repair, and disposal of appliances.
(See 40 CFR 82.150).
    To support this goal, EPA is finalizing several updates to its
reclamation requirements. Specifically, EPA is finalizing its proposal
(1) to require a reclaimer to notify EPA when there is a change in
business management, location, or contact information and (2) to
require disaggregated information for all reclaimed refrigerants as
part of the annual reporting. EPA is not finalizing its proposed
incorporation by reference of AHRI 700-2012 at this time due to the
ongoing review of the standard by a joint ASHRAE and AHRI research
group.

A. Overview of Current Reclamation Standards

    Recovered refrigerant often contains contaminants, including air,
water, particulates, acids, chlorides, high boiling residues, and other
impurities. Reclamation is the re-processing and upgrading of a
recovered controlled substance through such mechanisms as filtering,
drying, distillation, and chemical treatment in order to restore the
substance to a specified standard of performance. EPA's definition of
reclaim at 40 CFR 82.152 refers to specifications in appendix A to 40
CFR part 82, subpart F that are based on ARI Standard 700-1995,
Specification for Fluorocarbons and Other Refrigerants. A used
refrigerant may not be sold, distributed or offered for sale or
distribution, unless certain requirements have been met; one such set
of requirements provides in part that the used refrigerant must be
reclaimed to the purity level specified by the regulations and its
purity must be verified (see 40 CFR 82.154(g)(1)).
    Additionally, reclamation companies must meet certain EPA
certification requirements to become a reclaimer and must satisfy
recordkeeping and reporting requirements, including reporting annually
on the amount of ODS refrigerant that they reclaim (see 40 CFR 82.164
and 82.166(g-h)).

B. Benefits of Reclamation

    Proper recovery, recycling or reclamation, and reuse of HCFC-22 and
other ODS refrigerants is an essential component of stratospheric ozone
protection. Refrigerant reuse is preferable to venting or destruction.
Recovery and reuse reduces emissions of HCFCs to the atmosphere. Reuse
also reduces the amount of virgin material that needs to be produced.
Section 608(c) of the CAA contains certain prohibitions on knowingly
venting or releasing HCFCs during maintenance, service, repair, or
disposal of an appliance and EPA regulations require that HCFCs be
recovered during service or disposal of appliances (see 40 CFR 82.154
and 82.156).
    Recovery and reuse is becoming increasingly important as the United
States continues its progress in the phaseout of ODS. As discussed
earlier in this preamble, EPA is reducing the number of HCFC-22
consumption allowances provided in 2015 by almost 60 percent relative
to 2014. Reclamation will continue to be a key component of a smooth
transition from HCFC-22 to non-ODS alternatives.

C. What regulatory changes is EPA finalizing under CAA section 608?

1. Consideration of AHRI 700-2012 Standards
    In the proposed rule, EPA sought comment on revising the
reclamation standards in appendix A of 40 CFR subpart F to incorporate
by reference the current version of the ARI (now AHRI) Standard 700-
2012, including addenda added in August 2008 and August 2012 (AHRI
700C-2008: Appendix C to AHRI Standard 700-Analytical Procedures for
AHRI Standard 700-06 and AHRI 700D-2012: Appendix D Gas Chromatograms
for AHRI Standard 700-2012-Informative, all three of which are included
in the docket). While EPA would prefer to update the standards to use
the most current industry best practices, the agency is not finalizing
its proposal to incorporate the AHRI 700-2012 standard at this time
because of concerns about the 40 ppm limit for unsaturated contaminants
(unsaturates).
    EPA received ten comments related to the adoption of AHRI Standard
700-2012. Six comments oppose the adoption of AHRI Standard 700-2012 at
this time, stating that the specification of 40 ppm limit for
unsaturates will cause undue hardship to the reclamation industry since
most reclaimers do not have the capability to detect contamination at
this level. One comment opposing the change is signed by ten companies.
Commenters also

note that studies and testing are ongoing and EPA should wait until
they are complete before adopting the new standard to ensure the
unsaturates limit is appropriate for HVACR equipment performance. One
commenter believes that any new standard will need to be phased in over
a five-year period to give companies ample time to adapt. Another
commenter recommends that reclaimed refrigerant collected and processed
in the U.S. that is not mixed or blended with new refrigerants be
exempt from the unsaturates specification in the AHRI Standard 700-
2012. The commenter notes that a significant quantity of reclaimed
refrigerant that would have passed the previous AHRI standard would
fail this new standard.
    Five commenters support the adoption of AHRI Standard 700-2012,
stating that it reflects the most up to date testing procedures which
have already been recognized and adopted by the industry since 2006.
Two commenters strongly recommend that EPA institute a process by which
it will adopt future versions of the AHRI standard in a timely manner.
Since an AHRI and ASHRAE joint research project has not yet concluded
its assessment of the appropriateness of the 40 ppm limit for
unsaturates, EPA is not finalizing its proposed revision to appendix A
and the definition of ``reclaim'' at this time. Once the research
project, Effect of Unsaturated Fluorocarbon Contaminates on the
Reliability and Performance of HVACR Equipment, is completed, EPA will
reassess how to proceed.
2. Notification to EPA of Changes to Business Management, Location, or
Contact Information
    Reclaimer certification does not transfer when there is a change in
ownership. Section 40 CFR 82.164(f) requires the new owner of the
reclamation company to certify with EPA within thirty days of the
change of ownership; however, there are no provisions that a
reclamation company must notify EPA of changes in business management,
location, or contact information for the refrigerant manager who
communicates with EPA. EPA believes that notification of changes in
business information would improve accountability and benefit
reclaimers in the long run. Without accurate information, EPA may not
be able to communicate with a reclaimer in a timely manner.
Additionally, as a benefit to the public, the agency wants to ensure
that its Web site listing certified reclaimers and their contact
information is accurate. All of the comments received on the proposed
change were supportive, EPA is finalizing its proposal to require
notification from the reclaimer when there is a change in business
management, location, or contact information. The change will appear at
40 CFR 82.164(f).
3. Reporting and Recordkeeping Requirements
    Currently, 40 CFR 82.166(h) requires that reclaimers, on an annual
basis, report how much material was received for reclamation, the mass
of refrigerant reclaimed, and the mass of waste product generated as a
result of reclamation activities. However, the regulations do not
clearly state that reported information must be broken down by
refrigerant type. Some reclaimers do submit information broken down by
refrigerant, and EPA typically asks for refrigerant-specific
information when it is not provided. EPA uses this information as part
of its review of refrigerant supply to help ensure the continued smooth
transition out of ODS refrigerants. The agency believes it is essential
for EPA and the public to have accurate information concerning the
amounts of specific types of refrigerants that are available from
reclaimers for reuse.
    All comments received on the proposal were supportive of EPA's
proposed change. EPA is finalizing its proposal to require
disaggregated information for all reclaimed refrigerants as part of the
annual reporting. The revision will appear at 40 CFR 82.166(h). The
agency believes that this proposed change will clarify what information
it needs from reclaimers up front, and will alleviate the need for
additional back-and-forth between EPA and reclamation companies that in
the past were not submitting refrigerant-specific data, thereby
potentially reducing burden associated with reporting for those
companies.
4. Other Section 608 Reclamation Program Options
    EPA also sought comment on whether the agency should initiate a
rulemaking that would require (1) reporting of inventory information
from reclaimers and on the possibility of future reporting and
recordkeeping changes that would help minimize emissions and facilitate
a smooth transition away from ODS, (2) a more robust reclaimer
certification application, and (3) expanded end product testing. EPA
appreciates the diverse comments that were received and will consider
those comments as it determines whether to take additional action in
future.
5. Other Issues Related to Section 608's National Recycling and
Emissions Reduction Program
    EPA also received a comment in support of a petition that EPA
recently received from the Alliance dated January 31, 2014, requesting
that the agency initiate rulemaking to extend the section 608
refrigerant management regulations to hydrofluorocarbons (HFCs) and
other substitutes for class I and class II ODS. The Alliance cites
section 608(c)(2) of the CAA as authority. While action on this
petition is beyond the scope of this rulemaking, EPA is actively
considering the merits and environmental benefits of this petition
under a separate process. A copy of the petition is included in the
docket for this rulemaking as a reference.

IX. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review and Executive
Order 13563: Improving Regulation and Regulatory Review

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), this
action is a ``significant regulatory action'' since it raises ``novel
legal or policy issues.'' Accordingly, EPA submitted this action to the
Office of Management and Budget (OMB) for review under Executive Orders
12866 and 13563 (76 FR 3821, January 21, 2011) and any changes made in
response to OMB recommendations have been documented in the docket for
this action.
    EPA did not conduct a specific analysis of the benefits and costs
associated with this particular action because many previous analyses
provide a wealth of information on the costs and benefits of the United
States ODS phaseout, and specifically the HCFC phaseout:
     The 1993 Addendum to the 1992 Phaseout Regulatory Impact
Analysis: Accelerating the Phaseout of CFCs, Halons, Methyl Chloroform,
Carbon Tetrachloride, and HCFCs.
     The 1999 Report Costs and Benefits of the HCFC Allowance
Allocation System.
     The 2000 Memorandum Cost/Benefit Comparison of the HCFC
Allowance Allocation System.
     The 2005 Memorandum Recommended Scenarios for HCFC
Phaseout Costs Estimation.
     The 2006 ICR Reporting and Recordkeeping Requirements of
the HCFC Allowance System.
     The 2007 Memorandum Preliminary Estimates of the

Incremental Cost of the HCFC Phaseout in Article 5 Countries.
     The 2007 Memorandum Revised Ozone and Climate Benefits
Associated with the 2010 HCFC Production and Consumption Stepwise
Reductions and a Ban on HCFC Pre-charged Imports.
    A memorandum summarizing these analyses is available in the docket.

B. Paperwork Reduction Act

    This action does not impose any new information collection burden.
The Office of Management and Budget (OMB) has previously approved the
information collection requirements contained in the existing
regulations at 40 CFR part 82, subpart A under the provisions of the
Paperwork Reduction Act, 44 U.S.C. 3501 et seq. and has assigned OMB
control number 2060-0498.
    While this rule modifies the recordkeeping and reporting
regulations, it does not increase the information collection burden.
The changes are as follows: (1) Requiring reclaimers to provide updated
contact information and (2) requiring reclaimers to provide the amount
of each refrigerant reclaimed in their annual reporting. These changes
reflect customary business practices and therefore do not affect
information collection burden. In both of these cases, EPA is modifying
the regulations so they align with current practices. EPA has posted to
the docket and submitted to OMB completed an Information Collection
Request (ICR) Change Worksheet, documenting the changes and their non-
effect on the collection burden. The OMB control numbers for EPA's
regulations in 40 CFR are listed in 40 CFR part 9.

C. Regulatory Flexibility Act (RFA)

    The Regulatory Flexibility Act (RFA) generally requires an agency
to prepare a regulatory flexibility analysis of any rule subject to
notice and comment rulemaking requirements under the Administrative
Procedure Act or any other statute, unless the agency certifies that
the rule will not have a significant economic impact on a substantial
number of small entities. Small entities include small businesses,
small organizations, and small governmental jurisdictions.
    For purposes of assessing the impacts of this rule on small
entities, a small entity is defined as: (1) A small business as defined
by the Small Business Administration's (SBA) regulations at 13 CFR
121.201; (2) a small governmental jurisdiction that is a government of
a city, county, town, school district or special district with a
population of less than 50,000; and (3) a small organization that is
any not-for-profit enterprise which is independently owned and operated
and is not dominant in its field. This action will potentially affect
the following categories:

--Industrial Gas Manufacturing entities (NAICS code 325120), including
fluorinated hydrocarbon gas manufacturers and reclaimers;
--Other Chemical and Allied Products Merchant Wholesalers (NAICS code
424690), including chemical gases and compressed gases merchant
wholesalers;
--Air-Conditioning and Warm Air Heating Equipment and Commercial and
Industrial Refrigeration Equipment Manufacturing entities (NAICS code
333415), including air-conditioning equipment and commercial and
industrial refrigeration equipment manufacturers;
--Air-Conditioning Equipment and Supplies Merchant Wholesalers (NAICS
code 423730), including air-conditioning (condensing unit, compressors)
merchant wholesalers;
--Electrical and Electronic Appliance, Television, and Radio Set
Merchant Wholesalers (NAICS code 423620), including air-conditioning
(room units) merchant wholesalers;
--Plumbing, Heating, and Air-Conditioning Contractors (NAICS code
238220), including Central air-conditioning system and commercial
refrigeration installation, HVACR contractors;
--Refrigerant reclaimers, manufacturers of recovery/recycling
equipment, and refrigerant recovery/recycling equipment testing
organizations;
--Fire Extinguisher Chemical Preparations Manufacturing (325998);
Portable Fire Extinguishers Manufacturing (339999); Other Aircraft
Parts and Auxiliary Equipment Manufacturing (336413);
--Surgical Appliance and Supplies Manufacturing (339113); Ophthalmic
goods manufacturing (339115); General Medical and Surgical Hospitals
(622110); Specialty (Except Psychiatric and Substance Abuse) Hospitals
(622310);
--Entities Performing Solvent Cleaning, (including but not necessarily
limited to NAICS subsector codes 332 and 335).

    After considering the economic impacts of today's final rule on
small entities, I certify that this action will not have a significant
economic impact on a substantial number of small entities. In
determining whether a rule has a significant economic impact on a
substantial number of small entities, the impact of concern is any
significant adverse economic impact on small entities, since the
primary purpose of the regulatory flexibility analyses is to identify
and address regulatory alternatives ``which minimize any significant
economic impact of the rule on small entities.'' 5 U.S.C. 603 and 604.
Thus, an agency may certify that a rule will not have a significant
economic impact on a substantial number of small entities if the rule
relieves regulatory burden, or otherwise has a positive economic effect
on all of the small entities subject to the rule.
    Without allowances for the 2015-2019 regulatory period, existing
regulations would prohibit the production and import of HCFCs. Since
the direct result of this final action is to allocate HCFC allowances
for production and import, thereby relieving a prohibition, the direct
effects of this final decision are not a potential burden to small
business. EPA's HCFC Phaseout Benefits and Costs Memo, included in the
docket for this rulemaking, provides a summary of previous small
business analyses. Though EPA certified in the proposal that this
rulemaking would not have a significant impact on a substantial number
of small entities, EPA completed an economic screening analysis prior
to development of this final rule, titled, ``Economic Impact Screening
Analysis for Proposed Adjustments to the Allowance System for
Controlling HCFC Production, Import and Export'' (Screening Analysis).
EPA's Screening Analysis, which is available in the docket, shows that
the HCFC allocation for 2015-2019 is expected to have a net economic
benefit to the small businesses that are directly impacted by this
rulemaking. Therefore, EPA continues to believe that this rulemaking
does not have a significant impact on a substantial number of small
entities.
    Although this final rule will not have a significant economic
impact on a substantial number of small entities, EPA nonetheless has
tried to reduce the impact of this rule on small entities. The agency
is also aware that there is substantial interest in this rule among
small entities, particularly recovery and reclamation companies and
HVACR distributors and wholesalers. In light of this interest, on
January 31, 2014, one week after the January 23 public hearing, EPA
participated in a Small Business Administration Environmental
Roundtable on the proposed HCFC-22 allocation options and discussed the
proposal with small business attendees.

The presentation from that roundtable is available in the docket. As
explained during the roundtable, if a small entity will have
obligations imposed on them directly by the rule then the potential
impact on those small entities should be included in the RFA screening
analysis. The direct effect of this rulemaking is to issue allowances
that allow for continued production and import of a salable commodity.
Allowances for production and import of four HCFCs in 2015-2019 are
being issued to baseline allowance holders, including both large and
small businesses.
    The January 31 roundtable had approximately 20 participants,
representing both small and large businesses. The small businesses in
attendance did not have a uniform position on the size of the HCFC-22
allocation. Some spoke in support of a zero allocation; other small
businesses or organizations representing small businesses spoke out
against a zero allocation, stating the importance of market certainty
and a continued HCFC-22 allocation for their business planning needs.
    EPA received two written comments on the RFA. One commenter stated
that RFA and SBREFA issues have not been met because the agency's
statement that this action does not have a significant economic impact
on a substantial number of small entities applies to allowance holders.
The commenter writes, ``this rule alters or changes other elements of
40 CFR Title VI, Section 608 and 609.'' EPA assumes the commenter meant
40 CFR part 82, and is then referring to Clean Air Act Title VI,
specifically sections 608 and 609. EPA is not taking any action under
CAA section 609 in this rulemaking. EPA is finalizing two minor changes
to recordkeeping and reporting provisions in 40 CFR part 82 subpart F
under the authority of CAA section 608; however, these changes do not
increase burden and may in fact lessen burden on small reclamation
businesses by ensuring that businesses that have already reported do
not have to spend additional time responding to follow-up requests from
EPA. These changes also ensure that EPA can reach businesses in a
timely manner with any necessary information.
    The other commenter claims that EPA has not given due diligence to
its obligations under the RFA to ensure that the rule does not inflict
undue financial burden on small businesses. As explained above, the
direct result of this final action is to allocate HCFC allowances for
production and import, thereby relieving a prohibition; thus, the
direct effects of this final decision are not a potential burden to
small business. EPA explains the considerations and rationale for its
final HCFC-22 consumption allocation in section VI.A. of this preamble.
    I have therefore concluded that today's final rule will relieve
regulatory burden for directly affected small entities.

D. Unfunded Mandates Reform Act

    This action contains no Federal mandates under the provisions of
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C.
1531-1538 for State, local, or tribal governments or the private
sector. UMRA does not apply to rules that are necessary for the
national security or the ratification or implementation of
international treaty obligations. This rule implements the2015
milestone for the phase-out of HCFCs under the Montreal Protocol.
Therefore, this action is not subject to the requirements of sections
202 or 205 of the UMRA.
    This action is also not subject to the requirements of section 203
of UMRA because it contains no regulatory requirements that might
significantly or uniquely affect small governments. This action
apportions production and consumption allowances and establishes
baselines for private entities, not small governments.

E. Executive Order 13132: Federalism

    This action does not have federalism implications. It does not have
substantial direct effects on the States, on the relationship between
the national government and the States, or on the distribution of power
and responsibilities among the various levels of government, as
specified in Executive Order 13132. This action is expected to
primarily affect producers, importers, and exporters of HCFCs. Thus,
Executive Order 13132 does not apply to this action.
    In the spirit of Executive Order 13132, and consistent with EPA
policy to promote communications between EPA and State and local
governments, EPA specifically solicited, but did not receive, comment
from State and local officials on this issue.

F. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments

    This action does not have tribal implications, as specified in
Executive Order 13175 (65 FR 67249, November 9, 2000). This action does
not significantly or uniquely affect the communities of Indian tribal
governments. It does not impose any enforceable duties on communities
of Indian tribal governments. Thus, Executive Order 13175 does not
apply to this action.
    Although Executive Order 13175 does not apply to this action, EPA
participated in a National Tribal Air Association conference call
hosted by EPA regarding EPA air policy. EPA provided a summary of the
proposed rule, the importance of protecting and restoring the
stratospheric ozone layer, and how the 2015-2019 rule would further the
goals of the HCFC phaseout. EPA provided contact information and
offered to answer any specific questions following the call or at any
point in the future.

G. Executive Order 13045: Protection of Children From Environmental
Health and Safety Risks

    This action is not subject to EO 13045 (62 F.R. 19885, April 23,
1997) because it is not economically significant as defined in EO
12866. The agency nonetheless has reason to believe that the
environmental health or safety risk addressed by this action may have a
disproportionate effect on children. Depletion of stratospheric ozone
results in greater transmission of the sun's ultraviolet (UV) radiation
to the earth's surface. The following studies describe the effects of
excessive exposure to UV radiation on children: (1) Westerdahl J,
Olsson H, Ingvar C. ``At what age do sunburn episodes play a crucial
role for the development of malignant melanoma,'' Eur J Cancer 1994:
30A: 1647-54; (2) Elwood JM Japson J. ``Melanoma and sun exposure: an
overview of published studies,'' Int J Cancer 1997; 73:198-203; (3)
Armstrong BK, ``Melanoma: childhood or lifelong sun exposure,'' In:
Grobb JJ, Stern RS Mackie RM, Weinstock WA, eds. ``Epidemiology, causes
and prevention of skin diseases,'' 1st ed. London, England: Blackwell
Science, 1997: 63-6; (4) Whiteman D., Green A. ``Melanoma and
Sunburn,'' Cancer Causes Control, 1994: 5:564-72; (5) Heenan, PJ.
``Does intermittent sun exposure cause basal cell carcinoma? A case
control study in Western Australia,'' Int J Cancer 1995; 60: 489-94;
(6) Gallagher, RP, Hill, GB, Bajdik, CD, et al. ``Sunlight exposure,
pigmentary factors, and risk of nonmelanocytic skin cancer I, Basal
cell carcinoma,'' Arch Dermatol 1995; 131: 157-63; (7) Armstrong, DK.
``How sun exposure causes skin cancer: an epidemiological
perspective,'' Prevention of Skin Cancer. 2004. 89-116.
    This action implements the commitment of the United States to
reduce the production and import of HCFCs under the Montreal Protocol.
While on an ODP-weighted basis, this is

not as large a step as previous actions, such as the 1996 class I
phaseout, it is one of the most significant remaining actions the
United States can take to complete the overall phaseout of ODS and
further decrease impacts on children's health from stratospheric ozone
depletion. The final HCFC consumption allocation for 2015 is more than
95 percent below the United States HCFC baseline, decreasing further
through 2019.

H. Executive Order 13211: Actions That Significantly Affect Energy
Supply, Distribution, or Use

    This action is not a ``significant energy action'' as defined in
Executive Order 13211 (66 FR 28355, May 22, 2001), because it is not
likely to have a significant adverse effect on the supply,
distribution, or use of energy. The rule issues allowances for the
production and consumption of HCFCs.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement
Act of 1995 (``NTTAA''), Public Law 104-113, 12(d) (15 U.S.C. 272 note)
directs EPA to use voluntary consensus standards in its regulatory
activities unless to do so would be inconsistent with applicable law or
otherwise impractical. Voluntary consensus standards are technical
standards (e.g., materials specifications, test methods, sampling
procedures, and business practices) that are developed or adopted by
voluntary consensus standards bodies. NTTAA directs EPA to provide
Congress, through OMB, explanations when the Agency decides not to use
available and applicable voluntary consensus standards.
    The proposed rule involved technical standards because EPA proposed
to incorporate by reference AHRI Standard 700-2012 Specification for
Fluorocarbons and Other Refrigerants and its appendices. The proposed
standard is an updated version of the standard contained in the current
regulations. The agency is not finalizing its proposal to update the
standard, therefore, this final rule does not involve any technical
standards.

J. Executive Order 12898: Federal Actions To Address Environmental
Justice in Minority Populations and Low-Income Populations

    Executive Order (EO) 12898 (59 FR 7629, Feb. 16, 1994) establishes
Federal executive policy on environmental justice. Its main provision
directs Federal agencies, to the greatest extent practicable and
permitted by law, to make environmental justice part of their mission
by identifying and addressing, as appropriate, disproportionately high
and adverse human health or environmental effects of their programs,
policies, and activities on minority populations and low-income
populations in the United States.
    EPA has determined that this action will not have
disproportionately high and adverse human health or environmental
effects on minority or low-income populations. The 2015 phaseout step
increases the level of environmental protection for all affected
populations without having any disproportionately high and adverse
human health or environmental effects on any population, including any
minority or low-income population. This action implements the
commitment of the United States to reduce the production and import of
HCFCs under the Montreal Protocol. While on an ODP-weighted basis, this
is not as large a step as previous actions, such as the 1996 class I
phaseout, it is one of the most significant remaining actions the
United States can take to complete the overall phaseout of ODS and
further lessen the adverse human health effects for the entire
population. The final HCFC consumption allocation for 2015 is more than
95 below the United States HCFC consumption baseline, outperforming the
requirements set by the Montreal Protocol and Title VI of the Clean Air
Act.
    The agency did receive two comments pertaining to this executive
order. The National Association for the Advancement of Colored People
(NAACP) states that climate change has a disproportionate impact on
communities of color in the United States and around the world. NAACP
supports efforts to eliminate chemicals that have dangerous or damaging
effects on our communities, and points to both the ozone depleting
potential and global warming potential of HCFCs. NAACP asks to be
included during the drafting of the 2015-2019 final rule. The other
commenter, New Era Group, Inc., believes that EPA blocks organizations
such as the NAACP from engaging on this issue and states that climate
change is a significant issue for minorities and people of color.
    As part of the 2009 Endangerment Finding under CAA section
202(a)(1),\29\ the Administrator considered climate change risks to
minority or low-income populations, finding that certain parts of the
population may be especially vulnerable based on their circumstances.
These include the poor, the elderly, the very young, those already in
poor health, the disabled, those living alone, and/or indigenous
populations dependent on one or a few resources. The Administrator
placed weight on the fact that certain groups, including children, the
elderly, and the poor, are most vulnerable to climate-related health
effects.
---------------------------------------------------------------------------

    \29\ ``Endangerment and Cause or Contribute Findings for
Greenhouse Gases Under Section 202(a) of the Clean Air Act,'' 74 FR
66,496 (Dec. 15, 2009) (``Endangerment Finding'').
---------------------------------------------------------------------------

    Since HCFCs are ozone depleting substances and also greenhouse
gases that can contribute to climate change, the agency takes seriously
its mandate to phase out production and import of these substances. In
fact, this rulemaking far outperforms domestic and international caps
on U.S. HCFC production. In addition, both stratospheric ozone
depletion and climate change are global issues. That is, the impact of
HCFC emissions on stratospheric ozone or atmospheric greenhouse
concentrations is independent of where the HCFCs were used or
eventually emitted. The agency discusses the environmental implications
of the chosen HCFC-22 allocation levels in section VI.A. of this
preamble. The agency appreciates NAACP's comment, and invited
representatives from NAACP to meet with EPA while developing this final
rule.

K. Congressional Review Act

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the
Small Business Regulatory Enforcement Fairness Act of 1996, generally
provides that before a rule may take effect, the agency promulgating
the rule must submit a rule report, which includes a copy of the rule,
to each House of the Congress and to the Comptroller General of the
United States. EPA will submit a report containing this rule and other
required information to the U.S. Senate, the U.S. House of
Representatives, and the Comptroller General of the United States prior
to publication of the rule in the Federal Register. A Major rule cannot
take effect until 60 days after it is published in the Federal
Register. This action not a ``major rule'' as defined by 5 U.S.C.
804(2). This rule will be effective January 1, 2015.

List of Subjects in 40 CFR Part 82

    Environmental protection, Administrative practice and procedure,
Air pollution control, Chemicals, Exports, Hydrochlorofluorocarbons,
Imports.

    Dated: October 16, 2014.
Gina McCarthy,
Administrator.

    For the reasons stated in the preamble, 40 CFR part 82 is amended
as follows:

PART 82--PROTECTION OF STRATOSPHERIC OZONE

0
1. The authority citation for part 82 continues to read as follows:

    Authority:  42 U.S.C. 7414, 7601, 7671- 7671q.

Subpart A--Production and Consumption Controls

0
2. Amend Sec.  82.3 by adding the definition of ``Use of a class II
controlled substance'' in alphabetical order to read as follows:

Sec.  82.3  Definitions for class I and class II controlled substances.

* * * * *
    Use of a class II controlled substance, for the purposes of Sec.
82.15 of this subpart, includes but is not limited to, use in a
manufacturing process, use in manufacturing a product, intermediate
uses such as formulation or packaging for other subsequent uses, and
use in maintaining, servicing, or repairing an appliance or other piece
of equipment. Use of a class II controlled substance also includes use
of that controlled substance when it is removed from a container used
for the transportation or storage of the substance but does not include
use of a manufactured product containing a controlled substance.

0
3. Amend Sec.  82.15 by redesignating paragraph (g)(4) as (g)(4)(i) and
revising it, and adding paragraphs (g)(4)(ii) and (iii) to read as
follows:

Sec.  82.15  Prohibitions for class II controlled substances.

* * * * *
    (g) * * *
    (4)(i) Effective January 1, 2015, no person may introduce into
interstate commerce or use any class II controlled substance not
governed by paragraphs (g)(1) through (3) of this section (unless used,
recovered and recycled) for any purpose other than for use in a process
resulting in its transformation or its destruction; for use as a
refrigerant in equipment manufactured before January 1, 2020; for use
as a fire suppression streaming agent listed as acceptable for use or
acceptable subject to narrowed use limits for nonresidential
applications in accordance with the regulations at subpart G of this
part; for export to Article 5 Parties under Sec.  82.18(a); as a
transhipment or heel; for exemptions permitted under paragraph (f) of
this section; or for exemptions permitted under paragraph (g)(4)(ii) or
(iii) of this section.
    (ii) Effective January 1, 2015, use of HCFC-225ca or HCFC-225cb as
a solvent (excluding use in manufacturing a product containing HCFC-
225ca or HCFC-225cb) is not subject to the use prohibition in paragraph
(g)(4)(i) of this section if the person using the HCFC-225ca or HCFC-
225cb placed the controlled substance into inventory before January 1,
2015. This paragraph does not create an exemption to the prohibition on
introduction into interstate commerce in paragraph (g)(4)(i) of this
section.
    (iii) Effective January 1, 2015, use of HCFC-124 as a sterilant for
the manufacture and testing of biological indicators is not subject to
the use prohibition in paragraph (g)(4)(i) of this section if the
person using the HCFC-124 placed the controlled substance into
inventory before January 1, 2015. This paragraph does not create an
exemption to the prohibition on introduction into interstate commerce
in paragraph (g)(4)(i) of this section.
* * * * *

0
4. Amend Sec.  82.16 by revising paragraphs (a)(1), (d), and (e) and
removing and reserving paragraph (h).
    The revisions read as follows:

Sec.  82.16  Phaseout schedule of class II controlled substances.

    (a) Calendar-year Allowances. (1) In each control period as
indicated in the following tables, each person is granted the specified
percentage of baseline production allowances and baseline consumption
allowances for the specified class II controlled substances apportioned
under Sec. Sec.  82.17 and Sec.  82.19:

                                                        Calendar-Year HCFC Production Allowances
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Percent of   Percent  of   Percent  of   Percent of   Percent  of   Percent of   Percent of
                      Control period                         HCFC-141b      HCFC-22      HCFC-142b     HCFC-123     HCFC-124     HCFC-225ca   HCFC-225cb
--------------------------------------------------------------------------------------------------------------------------------------------------------
2003......................................................            0         100          100     ...........  ............  ...........  ...........
2004......................................................            0         100          100     ...........  ............  ...........  ...........
2005......................................................            0         100          100     ...........  ............  ...........  ...........
2006......................................................            0         100          100     ...........  ............  ...........  ...........
2007......................................................            0         100          100     ...........  ............  ...........  ...........
2008......................................................            0         100          100     ...........  ............  ...........  ...........
2009......................................................            0         100          100     ...........  ............  ...........  ...........
2010......................................................            0          41.9          0.47            0         125            125          125
2011......................................................            0          32.0          4.9             0         125            125          125
2012......................................................            0          17.7          4.9             0         125            125          125
2013......................................................            0          30.1          4.9             0         125            125          125
2014......................................................            0          26.1          4.9             0         125            125          125
2015......................................................            0          21.7          0.37            0           5.0            0            0
2016......................................................            0          21.7          0.32            0           5.0            0            0
2017......................................................            0          21.7          0.26            0           5.0            0            0
2018......................................................            0          21.7          0.21            0           5.0            0            0
2019......................................................            0          21.7          0.16            0           5.0            0            0
--------------------------------------------------------------------------------------------------------------------------------------------------------

                                                        Calendar-Year HCFC Consumption Allowances
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Percent of   Percent  of   Percent  of   Percent of   Percent  of   Percent of   Percent of
                      Control period                         HCFC-141b      HCFC-22      HCFC-142b     HCFC-123     HCFC-124     HCFC-225ca   HCFC-225cb
--------------------------------------------------------------------------------------------------------------------------------------------------------
2003......................................................            0         100          100     ...........  ............  ...........  ...........
2004......................................................            0         100          100     ...........  ............  ...........  ...........

2005......................................................            0         100          100     ...........  ............  ...........  ...........
2006......................................................            0         100          100     ...........  ............  ...........  ...........
2007......................................................            0         100          100     ...........  ............  ...........  ...........
2008......................................................            0         100          100     ...........  ............  ...........  ...........
2009......................................................            0         100          100     ...........  ............  ...........  ...........
2010......................................................            0          41.9          0.47          125         125            125          125
2011......................................................            0          32.0          4.9           125         125            125          125
2012......................................................            0          17.7          4.9           125         125            125          125
2013......................................................            0          18.0          4.9           125         125            125          125
2014......................................................            0          14.2          4.9           125         125            125          125
2015......................................................            0           7.0          1.7           100           8.3            0            0
2016......................................................            0           5.6          1.5           100           8.3            0            0
2017......................................................            0           4.2          1.2           100           8.3            0            0
2018......................................................            0           2.8          1.0           100           8.3            0            0
2019......................................................            0           1.4          0.7           100           8.3            0            0
--------------------------------------------------------------------------------------------------------------------------------------------------------

* * * * *
    (d) Effective January 1, 2015, no person may produce class II
controlled substances not previously controlled for any purpose other
than for use in a process resulting in their transformation or their
destruction, for use as a refrigerant in equipment manufactured before
January 1, 2020, for use as a fire suppression streaming agent listed
as acceptable for use or acceptable subject to narrowed use limits for
nonresidential applications in accordance with the regulations at
subpart G of this part, for export under Sec.  82.18(a) using
unexpended Article 5 allowances, for export under Sec.  82.18(b) using
unexpended export production allowances, or for exemptions permitted in
Sec.  82.15(f). Effective January 1, 2015, no person may import class