Draft Regulatory Impact Analysis
Addendum:
Analysis of the Economic Impact and Benefits of the
Proposed Rule: American Innovation and
Manufacturing (AIM) Act Subsection H
Management of Regulated Substances
U.S. Environmental Protection Agency
Stratospheric Protection Division
Office of Atmospheric Programs
1200 Pennsylvania Avenue, NW
Washington, DC 20460
September 2023
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Table of Contents
Executive Summary 9
Climate Benefits 10
Compliance Costs 10
Net Benefits 10
Relationship to Allocation Framework Rule and 2024 Allocation Rule RIA Results 11
1. Introduction 13
1.1. Proposed Regulatory Requirements 14
1.2. Organization of this Document 16
2. Equipment Characterization 19
2.1. Equipment in the Fire Suppression Sector 19
2.2. Refrigeration and Comfort Cooling Appliances 19
2.3. Affected Equipment 21
3. Methodology 23
3.1. Relationship to Prior Analyses and Approach for Estimating Incremental Impacts 23
3.2. Costs and Benefits for Leak Repair and Inspection Provisions 26
3.3. Costs and Benefits for Reclamation Provisions 38
3.4. Costs and Benefits Related to Alternative Standards for Reclamation 38
3.5. Costs and Benefits for Handling of Disposable Cylinders and Container Tracking 39
3.6. Costs and Benefits for Reducing Emissions in the Fire Suppression Sector 40
3.7. Reporting and Recordkeeping Costs 40
3.8. Monetization of Emissions Benefits 44
3.9. Other Potential Benefits of this Rule 47
3.10. Costs and Benefits under a Marginal Abatement Cost Methodology 48
4. Economic Impact Analysis of Leak Repair and Inspection provisions 49
4.1. Annual Leak Repair Compliance Costs 49
4.2. Refrigerant Costs and Savings in 2025 by Rule Component 51
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4.3. Leak Repair and Inspection Emission Reduction Benefits 53
4.4. Leak Repair and Inspection Emission Reduction Benefits in Later Years 53
4.5. Estimated Climate Benefits of Leak Repair 54
4.6. Comparison of Net Benefits for Alternative Leak Repair and Automatic Leak Detection
Scenarios 55
5. Comparison of Costs and Benefits for the Proposed Rule 57
5.1. Comparison of Costs and Benefits of Leak Repair and Inspection Provisions 57
5.2 Comparison of Costs and Benefits of Required Use of Reclaimed HFCs 58
5.3 Comparison of Costs and Benefits of Requirements on HFC Cylinders 59
5.4 Comparison of Costs and Benefits of Fire Suppression Sector Provisions 59
5.5 Comparison of Costs and Benefits of RCRA Amendments 59
5.6 Recordkeeping and Reporting Costs 60
5.7 Comparison of Costs and Benefits of the Proposed Rule 61
6 Environmental Justice 63
6.1 Introduction and Background 63
6.2 Environmental Justice at EPA 63
6.3 Environmental Justice Analysis for this Rule 65
6.4 Aggregate Average Characteristics of Communities Near Potentially Affected Production
Facilities 67
6.5 Previous Violation and Enforcement Actions 69
6.6 Conclusion 72
References 74
Appendices: 76
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List of Tables
Table ES-1. Summary of Annual Values, Present Values, and Equivalent Annualized Values select years
for the 2025-2050 Timeframe for Estimated Compliance Costs, Benefits, and Net Benefits for this Rule
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Table 1-1 Proposed Leak Rate Thresholds by Equipment Category 16
Table 2-1. Estimated Installed Stock (MT) and Leak Emissions (MT) by Equipment Type (2025) 21
Table 2-2: Affected Appliance Assumptions by Equipment Sector, Type, and Size 23
Table 3-1: Leak Repair Outcomes and Proportions 27
Table 3-2: Leak Rate Assumptions by Equipment Sector, Type, and Size 28
Table 3-3: Unit Cost Assumptions for ALD Systems 31
Table 3-4: Unit Cost Assumptions for Leak Repairab c 32
Table 3-5: Average 2025 GWP Assumptions by Equipment Type, Size, and Refrigerant Type 34
Table 3-6: Expected Emissions Reductions in 2025 by Equipment Type and Size 35
Table 3-7: Average GWP Assumptions by Equipment Type, Size, and Refrigerant Type for 2030, 2040,
and 2050 37
Table 3-8: Expected Emissions Reductions by Equipment Type, Size, and Refrigerant Type for 2030,
2040, and 2050 37
Table 3-9: Labor Rates 41
Table 4-1: Aggregate Compliance Costs by Sector, Equipment Type, and Size3 49
Table 4-2. Incremental Annual Compliance Costs, Including Refrigerant Savings (2022$) 50
Table 4-3. Total Annual Refrigerant Savings in 2025 (2022$) and Combined Annual Cost and Annual
Savings with 7% and 3% Discount Rate 51
Table 4-4. 2025 Incremental Compliance Costs for Recordkeeping and Reporting for Leak Inspection and
Leak Repair (2022$) 52
Table 4-5. Annual GHG Emissions Avoided in 2025, 2030, 2040, and 2050 53
Table 4-6. Annual GHG Emissions Avoided in Select Years 54
Table 4-7. Monetized Climate Benefits (2022$) 54
Table 4-8. Comparison of Net Benefits for Alternative Leak Repair Thresholds. (Millions 2022$) 55
Table 4-9. Comparison of Net Benefits for Alternative ALD Thresholds (Millions of 2022$) 56
Table 5-1. Monetized Climate Benefits, Costs, and Net Benefits for Leak-related Provisions 57
Table 5-2. Monetized Climate Benefits, Costs, and Net Benefits for Required Use of Reclaim (millions of
2022$) 58
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Table 5-3. Monetized Climate Benefits, Costs, and Net Benefits for Fire Suppression Sector Provisions
Under High Additionality Scenario (millions of 2022$) 59
Table 5-4: Estimated Recordkeeping and Reporting Costs by Rule Provision (millions 2022$) ..60
Table 5-5: Present Value and Equivalent Annual Value of the Net Benefits or Costs of Rule Provisions
2025 2050; ' 61
Table 6-1: Overall Community Profile and 2019 AirToxScreen Risks for Communities Near Identified
Facilities 68
Table 6-2: Number of facilities falling under one or more environmental compliance regime 70
Table 6-3: Clean Water Act Compliance Status and Recent Enforcement History by Facility 70
Table 6-4: Resource Recovery and Conservation Act (RCRA) Compliance Status and Recent
Enforcement History by Facility 71
Table 6-5: Clean Air Act (CAA) Compliance Status and Recent Enforcement History by Facility 72
Table A-l: Leak Rate Distributions for Equipment 77
Table A-2: Leak Rate Distributions for Equipment between 5 and 15 pounds 79
Table B-l: Initial Charge and Service Demand of HFCs for Applicable Subsectors in 2028 and 2029 .... 80
Table B-2. Initial Charge Demand of HFCs for Applicable Subsectors in 2028 81
Table B-3: Service Demand of HFCs for Applicable Subsectors in 2028 82
Table B-4: Initial Charge Demand of HFCs for Applicable Subsectors in 2029 82
Table B-5: Service Demand of HFCs for Applicable Subsectors in 2029 83
Table B-6: Costs of Virgin Production, Destruction, and Reclamation ($/kg of refrigerant)3 84
Table B-7: GHG Emission Reductions Associated with Virgin Production, Destruction, and Reclamation
(kgC02eq/kg of produced refrigerant)3 85
Table B-8: Incremental Annual Cost Savings and GHG Emission Reductions Associated with
Reclamation (Thousands 2022$) 85
Table E-l: Total Annual Refrigerant Savings in 2030 (2022$) and Combined Annual Cost and Annual
Savings with 7% and 3% Discount Rate by Equipment Type 93
Table E-2: Total Annual Refrigerant Savings in 2040 (2022$) and Combined Annual Cost and Annual
Savings with 7% and 3% Discount Rate by Equipment Type 95
Table E-3: Total Annual Refrigerant Savings in 2050 (2022$) and Combined Annual Cost and Annual
Savings with 7% and 3% Discount Rate by Equipment Type 97
Table F-l: 2025 Total Annual Refrigerant Savings (2022$) and Combined Annual Cost and Annual
Savings with 7% and 3% Discount Rate and Benefits for Equipment 5-50 pounds 100
Table F-2: 2025 Monetized Climate Benefits and Net Benefits with 7% and 3% Discount Rate for
Equipment 5-50 pounds 102
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Table F-3: 2035 Total Annual Refrigerant Savings (2022$) and Combined Annual Cost and Annual
Savings with 7% and 3% Discount Rate and Benefits for Equipment 5-50 pounds 102
Table F-4: Annual GHG Emissions Avoided in 2030, 2040, and 2050 for Equipment 5-50 pounds 104
Table G-l: Unit Cost Assumptions for ALD Equipment for 500-pound Threshold 105
Table G-2: Aggregate Compliance Costs by Sector, Equipment Type, and Size for 500-pound ALD
Threshold3 106
Table G-3: Incremental Annual Compliance Costs (2022$) for 500-pound ALD Threshold Scenario ... 107
Table G-4: Total Annual Refrigerant Savings in 2025 (2022$) and Combined Annual Cost and Annual
Savings with 7% and 3% Discount Rate for 500-pound ALD Threshold Scenario 108
Table G-5: 2025 Incremental Compliance Costs for Recordkeeping and Reporting (2022$) for 500-pound
ALD Threshold Scenario 109
Table G-6: Annual GHG Emissions Avoided in 2025, 2030, 2040, and 2050 for 500-pound ALD
Threshold Scenario Ill
Table G-7: Annual GHG Emissions Avoided in Select Years for 500-pound ALD Threshold Scenario 111
Table H-l: Average Number of Systems per Facility in Industries Containing Appliances with 15 or More
Pounds of HFC Refrigerant 114
Table H-2: List of Industries Potentially Affected by the Prohibition of Disposable Cylinders by NAICS
Code 117
Table H-3: Travel Distances for Disposable and Refillable Cylinders Before Disposal 119
Table H-4: Additional Transportation Assumptions 120
Table H-5: Transportation Assumptions before Disposal per Cylinder 121
Table H-6: Cost Assumptions for BAU and Rulemaking from Cylinder Heel Recovery Requirement... 122
Table H-7: Summary of Annual Economic Impacts from Cylinder Heel Recovery Requirement on Small
Businesses by NAICS Code 123
Table H-8: School District and City Government Population and Revenue by Enrollment and Population
Size 126
Table H-9: Leak Repair Outcomes per School District or City 127
Table H-10: Number of School Districts and Cities Affected by Leak Repair Scenarios 128
Table H-l 1: Decision Matrix for Certifying SISNOSE 129
Table H-12: Summary of the Small Entities Impact 129
Table H-13: Aggregated Economic Impacts on Small Entities with 7% Discount Rate 131
Table H-14: Aggregated Economic Impacts on Small Entities with 3% Discount Rate 134
Table 1-1: NAICS Codes Included in the Leak Repair Analysis 138
Table J-l: S( -I II ( -32 (2020$) 151
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Table J-2: S( -I II ( -125 (2020$) 152
Table J-3: S( -I II ( -134a (2020$) 153
Table J-4: S( -I II ( -143a (2020$) 154
Table J-5: S( -I II ( -152a (2020$) 155
Table J-6: SC-HFC-227ea (2020$) 155
Table J-7: SC-HFC-236fa (2020$) 156
Table J-8: SC-HFC-245fa (2020$) 158
Table J-9: SC-HFC-43-10mee (2020$) 159
Table J-10: S( -I II ( -23 (2020$) 160
Table K-l: Summary of abatement strategies modeled and key factors evaluated to derive MAC estimates
165
Table K-2: Incremental Annual Compliance Costs of MAC Abatement Options (Billions 2022$) 167
Table K-3: Annual Consumption Reductions in Allocation Rule Reference Case and Supplementary
Subsection (h) Compliance Scenarios 168
Table K-4: Annual Emissions Reductions in Allocation Rule Reference Case and Supplementary
Subsection (h) Compliance Scenarios 169
Table K-5: Discounted Monetized Climate Benefits 2025-2050 (billions of 2020$)abc 170
Table K-6: Summary of Annual Incremental Climate Benefits, Costs, and Net Benefits in Base Case and
High Additionality Case Scenarios for the 2025-2050 Timeframe (millions of 2020$, discounted to
2022)•d 172
Table K-7: Leak Repair abatement options added to MACC model for the subsection (h) Rule analysis
177
Table K-8: ALD abatement options added to MACC model for the subsection (h) Rule analysis 178
Table K-9: Baseline percentage of demand met by reclaim 179
Table K-10: Initial charge reclaim abatement options added to MACC model for the subsection (h) Rule
analysis 181
Table K-l 1: Combined leak repair, ALD, and reclaim abatement options added to MACC model for the
subsection (h) Rule analysis 182
Table K-12: Servicing reclaim abatement options added to MACC model for the subsection (h) Rule
analysis 183
Table K-13: Servicing reclaim abatement options added to MACC model for the subsection (h) Rule
analysis, cont 184
Table K-14: Fire suppression abatement options added to MACC model for the subsection (h) Rule
analysis 185
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Table K-15: Summary of Mitigation Options Modeled
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List of Acronyms
AC
Air conditioning
AIM Act
American Innovation and Manufacturing Act of 2020, codified at 42 U.S.C.
ALD
Automatic Leak Detection
ASHRAE
American Society of Heating, Refrigerating and Air-Conditioning Engineers
CAA
Clean Air Act
CC
Comfort cooling
C02
Carbon dioxide
CR
Commercial refrigeration
EPA
Environmental Protection Agency
GHGs
Greenhouse gases
GWP
Global Warming Potential
HFCs
Hydrofluorocarbons
HFOs
Hydrofluoroolefins
IPR
Industrial process refrigeration
MACC
Marginal abatement cost curve
MTC02eq
Metric tons of CO2 equivalent
ODS
Ozone-depleting substances
O&M
operations and maintenance
PV
Present value
RACHP
Refrigeration, AC, and heat pump
RCRA
Resource Conservation and Recovery Act
RIA
Regulatory Impact Analysis
RMP
Refrigerant Management Program
SBREFA
Small Business Regulatory Enforcement Fairness Act of 1996
SC-HFCs
Social cost of HFCs
UMRA
Unfunded Mandates Reform Act
U.S.
United States
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Executive Summary
This Draft Regulatory Impact Analysis (RIA) addendum provides an assessment of the costs and
benefits of the proposed rule implementing provisions under subsection (h) of the American Innovation
and Manufacturing Act of 2020, codified at 42 U.S.C. § 7675 (AIM Act or the Act). Subsection (h) of the
AIM Act, entitled "Management of regulated substances," directs the United States (U.S.) Environmental
Protection Agency (EPA) to promulgate regulations to control, where appropriate, any practice, process,
or activity regarding the servicing, repair, disposal, or installation of equipment that involves: a regulated
substance (used interchangeably with "HFCs" in the proposed rulemaking and in this RIA addendum), a
substitute for a regulated substance, the reclaiming of a regulated substance used as a refrigerant, or the
reclaiming of a substitute for a regulated substance used as a refrigerant.
This rulemaking follows an already finalized rule issued separately under the AIM Act, Phasedown of
Hydrofluorocarbons: Establishing the Allowance Allocation and Trading Program Under the American
Innovation and Manufacturing Act (Allocation Framework Rule, 86 FR 55116, October 5, 2021), as well
as a later rule for the same program, Phasedown of Hydrofluorocarbons: Allowance Allocation
Methodology for 2024 and Later Years (88 FR 46836, July 20, 2023).1 The analysis presented in the
sections below provides estimated economic costs and environmental impacts of the provisions of the
proposed subsection (h) rule. The analysis also provides a comparison of these costs and benefits with
those assessed for the Allocation Framework Rules to provide the public with an understanding of any
potential changes in economic and environmental impacts relative to existing regulations. Results and
methods from these analyses are referenced throughout this document. As with the 2024 Allocation Rule
analysis, this document is presented as an addendum to the original Allocation Framework RIA. In
addition, for the purposes of identifying potential environmental justice issues, the analysis presents
EPA's assessment of the characteristics of communities near facilities reclaiming HFCs that are expected
to be affected by the rule. The information provided in the environmental justice section of this document
is for informational purposes only; EPA is not relying on the information in this section as a record basis
for the proposed action.
This analysis is intended to provide the public with information on the relevant costs and benefits of
this proposed rule and to comply with executive orders. While significant, the estimated benefits detailed
1 Throughout this document, we use "Allocation Framework RIA" and "2024 Allocation Rule RIA Addendum" to refer to the
analyses of these rules. We use "Allocation Rules" and "Allocation Rules RIA" to refer to combined or cumulative effect of
those two rules; i.e., the Allocation Framework RIA as updated by the 2024 Allocation Rule RIA Addendum.
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in this document are considered incidental and secondary to the rule's statutory objective of maximizing
reclamation and minimizing releases of certain hydrofluorocarbons (HFCs).
Climate Benefits
The incremental benefits of this rule derive from reducing damages from climate change induced by
reduced emissions of greenhouse gases (GHGs), specifically HFCs. The reduction in HFC emissions
would stem from provisions contained in the proposed rule aimed at maximizing reclamation and
minimizing the release of HFCs. The benefits of avoided climate damages are monetized using previously
established social cost of HFCs (SC-HFCs) estimates and are presented in Table ES-1. In our base case
estimate of incremental climate benefits, the proposed rule's provisions are estimated to produce benefits
of $9.8 billion from 2025-2050, in 2022 dollars and discounted to 2024 at 3 percent.
Compliance Costs
Incremental compliance costs stem from industry transitions required to comply with provisions
contained in the proposed rule. These include leak repair and inspection costs as well as Automatic Leak
Detection (ALD) system costs for owners and operators of affected equipment. Incremental costs also
stem from recordkeeping and reporting requirements detailed in the proposed rule. Reducing HFC
emissions due to fixing leaks earlier would also be anticipated to lead to savings for some system
owner/operators, as less new refrigerant would need to be purchased to replace leaked refrigerant. The
estimated combined net incremental compliance costs (costs less anticipated savings) stemming from the
proposed rule are shown in Table ES-1 in 2022 dollars, discounted back to 2024 at both 3 percent and 7
percent.
Net Benefits
The net benefits of the proposed rule are estimated as the climate benefits minus the compliance
costs in each year. Annual net benefits for select years over the 2025-2050 time period are presented in
Table ES-1, along with the net present value of the incremental benefits and costs. Provisions contained in
the proposed rule are estimated to have incremental net benefits of $6.1 billion in 2022 dollars from 2025
through 2050, discounted at 3 percent to 2022, equivalent to $353 million in incremental annual benefits
2025-2050. When a discount rate of 7 percent is used for the costs, the net present value of the
incremental net benefits is estimated at $7.4 billion, equivalent to $349 million in incremental annual net
benefits 2025-2050.
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Table ES-1. Summary of Annual Values, Present Values, and Equivalent Annualized Values select years
for the 2025-2050 Timeframe for Estimated Compliance Costs, Benefits, and Net Benefits for this Rule
(millions of 2022$, discounted to 2024) - Base Case Scenario a b c d
Year
Climate Benefits
Costs (annual)
Net Benefits (3% Benefits, 3% or
(3%)
7% Costs)
2025
$582
$279
$304
2030
$613
$194
$419
2035
$597
$199
$399
2040
$550
$203
$347
2045
$483
$206
$277
2050
$497
$213
$284
Discount rate
3%
3%
7%
3%
7%
Present value
$9,822
$3,702
$2,395
$6,120
$7,427
Equivalent
$566
$213
$217
$353
$349
annualized value
a Benefits include only those related to climate. Climate benefits are based on changes (reductions) in HFC
emissions and are calculated using four different estimates of the social cost of HFCs (SC-HFCs): model average at
2.5 percent, 3 percent, and 5 percent discount rates; 95th percentile at 3 percent discount rate. For the presentational
purposes of this table, we show the benefits associated with the average SC-HFC at a 3 percent discount rate, but the
Agency does not have a single central SC-HFC point estimate. We emphasize the importance and value of
considering the benefits calculated using all four SC-HFC estimates. As discussed in Chapter 4, a consideration of
climate benefits calculated using discount rates below 3 percent, including 2 percent and lower, is also warranted
when discounting intergenerational impacts. The costs presented in this table are annual estimates.
b Rows may not appear to add correctly due to rounding.
0 The annualized present value of costs and benefits are calculated as if they occur over a 26-year period from 2025
to 2050.
d The present value (PV) for the 7% net benefits column is found by taking the difference between the PV of climate
benefits at 3 percent and the PV of costs discounted at 7 percent. Due to the intergenerational nature of climate
impacts the social rate of return to capital, estimated to be 7 percent in OMB's Circular A-4, is not appropriate for
use in calculating PV of climate benefits.
Relationship to Allocation Framework Rule and 2024 Allocation Rule RIA Results
EPA has previously estimated costs and benefits of the HFC phasedown, which are detailed in the
Allocation Framework RIA and 2024 Allocation Rule RIA Addendum. The proposed Subsection (h) Rule
focuses on statutory provisions under the AIM Act that are separate from those addressed in the
Allocation Framework Rule. However, in order to avoid double counting or overestimating of costs and
benefits of the proposed action, for the purposes of this analysis the Allocation Framework Rule and 2024
Allocation Rule RIA Addendum are assumed to be the status quo from which incremental benefits may
be calculated.
As detailed in the Allocation Framework Rule RIA and 2024 Allocation Rule RIA Addendum, EPA
relied upon a Marginal abatement cost curve approach in order to estimate the full set of HFC abatement
options and associated compliance costs required to meet the statutory phasedown caps from 2022-2050.
Results from the analysis conducted for the proposed subsection (h) rule contained in this RIA Addendum
indicate that the proposed rule will yield incremental HFC emissions reductions relative to this previously
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modeled set of transitions.2 However, the estimated avoided emissions from some of the provisions
contained in this proposed rule are less than what they would be if a reference scenario were used that
does not assume these transitions and improved service activities occur. This is because some of the HFC
consumption- and emissions-reducing activities required by the proposed rule (such as improvements to
leak repair) were previously modeled for the Allocation Rules analyses and are therefore included in the
reference case for this analysis.
While the proposed subsection (h) rule yields incremental benefits relative to EPA's prior estimates, some
of these incremental benefits could be offset to the extent that additional HFC consumption allowances
are "freed up," allowing for increased HFC consumption in equipment not covered by this rule, so long as
overall domestic consumption and production remains within the AIM Act HFC phasedown cap for a
given year. For example, if additional reclaimed HFCs are utilized in the commercial refrigeration
subsector, industry may still shift the use of available consumption and production allowances to import
or produce HFCs to meet demand for other sectors or subsectors that are not covered by a reclaim
requirement.
To account for this uncertainty, this analysis provides two scenarios to illustrate the range of potential
incremental impacts. In our base case scenario, we conservatively estimate that abatement from
provisions in this rule may be offset by additional HFC consumption in subsectors not covered by this
rule, even if these subsectors were previously assumed to have consumption abatement in the Allocation
Rule Reference Case. To illustrate the potential upper bound incremental benefits of the proposed rule,
we then provide a "high additionally" case, in which abatement in these additional subsectors is included.
While this executive summary includes results from the base case only, results from both scenarios are
provided in Chapter 4 of this RIA addendum.
These assumptions are made for technical analytic purposes only and to avoid double counting of
benefits. They should not be interpreted as a reflection of the merits of any particular provision contained
in the proposed rule. EPA may also revisit these assumptions before finalization of this rule or at a future
date based on new information or public comment.
2 However, the schedule for the production and consumption phasedown is not made more stringent than the schedule under
subsection (e)(2)(C) of the AIM Act (i.e., the production and consumption caps contained in the Allocation Rules are
unchanged).
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1. Introduction
Under the American Innovation and Manufacturing Act (AIM Act), the United States (U.S.)
Environmental Protection Agency (EPA) is directed under subsection (h), "Management of Regulated
Substances," to promulgate certain regulations for purposes that include maximizing reclamation and
minimizing releases of certain hydrofluorocarbons (HFCs). Subsection (h)(1) of the AIM Act authorizes
EPA to establish regulations to control, where appropriate, practices, processes, or activities regarding the
servicing, repair, disposal, or installation of equipment, for purposes of maximizing the reclamation and
minimizing the release of certain HFCs from equipment and ensuring the safety of technicians and
consumers.
Among other things, subsection (h) also provides for the Agency to consider options to increase
opportunities for reclaiming HFCs used as refrigerants and potential approaches to coordinate regulations
carrying out subsection (h) of the AIM Act with similar EPA regulations. Those regulations could, for
example, include those implementing the refrigerant management program established under Title VI of
the Clean Air Act (CAA).
Pursuant to subsection (h) of the AIM Act, EPA is proposing to require the repair of leaks in
refrigerant-containing appliances with a charge size of 15 pounds or more of a refrigerant that contains an
HFC or substitute for an HFC with a Global Warming Potential (GWP) greater than 533,4 (whether the
appliance uses the HFC or substitute for an HFC neat or in a blend with other substances);5 the use of
automatic leak detection (ALD) systems for certain refrigeration equipment containing 1,500 pounds or
more of a refrigerant containing an HFC or a substitute for an HFC with a GWP above 53 for both new
and existing appliances; use of reclaimed refrigerant to fill new equipment and servicing or repairing
existing equipment in certain refrigeration, air conditioning (AC), and heat pump (RACHP) subsectors;
requirements regarding the servicing, repair, disposal, or installation of fire suppression equipment that
contains HFCs, as well as requirements related to technician training in the fire suppression sector; and
that used single-use ("disposable") cylinders that contain HFCs that have been used for the servicing,
repair, or installation of certain refrigerant-containing equipment or fire suppression equipment be
transported to an EPA-certified reclaimer or fire suppressant recycler, who would be required to remove
3 In this document, EPA is using the term "HFC" to refer to the 18 HFCs listed as regulated substances in the AIM Act and
codified in Appendix A to 40 CFR Part 84, and their isomers, whether the HFC is used neat or in a blend containing one or more
of these HFCs. We are using the term "substitute" to refer to substitutes for HFCs with a GWP greater than 53, whether the
substitute is used neat or in a blend.
4 53 is the lowest exchange value assigned to a listed HFC under Appendix A to 40 CFR Part 84 and is numerically equal to the
100-year integrated GWP of HFC-152 as listed in the IPCC Fourth Assessment Report (Forster et al. 2007).
5 Throughout this document, for ease of reference we may refer to this as the 15-pound threshold, a charge size of 15 pounds or
greater, or simply 15 pounds of refrigerant, without necessarily repeating that this includes refrigerants that contain an HFC or a
substitute for an HFC with a GWP greater than 53.
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the remaining HFCs, including the heel, prior to the disposal of these cylinders; labeling and tracking for
disposable and refillable containers of HFCs that could be used for the servicing, repair, and/or
installation of refrigerant-containing equipment or fire suppression equipment; and other recordkeeping
and reporting requirements. In addition, EPA is proposing alternative Resource Conservation and
Recovery Act (RCRA) standards for spent ignitable refrigerants being recycled for reuse.
The purpose of this Regulatory Impact Analysis (RIA), which builds on the RIA for Phasing Down
Production and Consumption of HFCs (EPA 2021)6 and the RIA for the AIM Act 2024 HFC Allocation
Rule (EPA 2022a), is to provide the public with information on the relevant costs and benefits of this
action, if finalized as proposed, and to comply with executive orders. This RIA documents the results of a
costs and benefits assessment to help EPA and the public evaluate the impact of this proposed rulemaking
across the affected businesses (see Appendix I). In addition to a cost and benefits analysis, EPA
conducted an environmental justice analysis evaluating facilities and surrounding communities that may
be impacted by this rule. Following the analytical approach used in the Allocation Framework Rule RIA,
EPA has provided demographic data and the cancer and respiratory risks to surrounding communities.
This update includes the most recent data available for the AirToxScreen dataset from 2020 (EPA 2023b).
1.1. Proposed Regulatory Requirements
The regulatory requirements proposed in this rulemaking include the following:
• Applying a suite of leak repair requirements to refrigerant-containing appliances, including
comfort cooling (CC), commercial refrigeration (CR), and industrial process refrigeration
(IPR) appliances, containing 15 or more pounds of a refrigerant containing a
hydrofluorocarbon (HFCs) or a substitute for an HFC, excluding those that have a GWP of 53
and below (e.g., CO2, ammonia, certain hydrofluoroolefins (HFOs)). This includes:
o Requiring annual leak inspection for all CR and IPR appliances7 containing 15
pounds up to 500 pounds of such refrigerant upon discovering the applicable leak rate
is exceeded to identify the leak,
o Requiring annual leak inspection for all CC and other appliances containing 15
pounds of such refrigerant upon discovering the applicable leak rate is exceeded to
identify the leak.
o Requiring quarterly leak inspection for all CR and IPR appliances that contain 500
pounds or more of such refrigerant upon discovering the applicable leak rate is
6 Also referred to as the Allocation Framework Rule RIA in this document.
7 EPA is proposing to exempt from the suite of leak repair requirements under subsection (h) any refrigerant-containing appliance
used for the residential and light commercial air conditioning and heat pumps subsector.
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exceeded (unless ALD equipment meeting certain requirements is used for
compliance).
o Requiring repair of leaks and initial and follow-up verification tests on the repairs for
all appliances containing 15 or more pounds of such refrigerant (i.e., CC, CR, and
IPR) when the applicable leak rate is exceeded,
o Allowing owners/operators of all CC, CR, and IPR appliances containing 15 or more
pounds of such refrigerant to request extensions to the leak repair and retrofit
timeline.
o Applying recordkeeping and reporting requirements associated with leak inspection
and leak repair to appliances containing 15 pounds or more of such refrigerant.
Use of ALD systems for CR and IPR appliances containing 1,500 pounds or more of a
refrigerant containing an HFC or substitute for an HFC with a GWP above 53 for both new
and existing appliances.
Use of reclaimed refrigerant for new equipment and/or servicing/repair of specific RACHP
appliances, including residential and light commercial AC, cold storage warehouses,
industrial process refrigeration, stand-alone retail food refrigeration, supermarket systems,
refrigerated transport, and automatic commercial ice makers.
Requirements for the servicing, repair, disposal, or installation of fire suppression equipment
that contains HFCs, as well as requirements related to technician training in the fire
suppression sector.
Requiring that disposable cylinders that have been used for the servicing, repair, or
installation of refrigerant-containing equipment or fire suppression equipment be transported
to an EPA-certified reclaimer or fire suppressant recycler; and that reclaimers and fire
suppressant recyclers remove all HFCs from disposable cylinders prior to disposal.
Use of a machine-readable tracking identifier for all containers of HFCs that could be used
for the servicing, repair, or installation of refrigerant-containing equipment or fire
suppression equipment and registration in the tracking system to update container tracking
information.
Finally, EPA is proposing alternative RCRA standards for spent ignitable refrigerants when
recycled for reuse, as the term is proposed to be used under RCRA. EPA is proposing that the
40 CFR part 266 Subpart Q RCRA alternative standards would apply to HFCs and their
substitutes that do not belong to flammability Class 3 as classified in the American Society of
Heating, Refrigerating and Air-Conditioning Engineers (ASHRAE) Standard 34-2022.
15
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Table 1-1 Proposed Leak Rate Thresholds by Equipment Category
Equipment Type
Leak Rate Threshold
Comfort Cooling
10%
Commercial Refrigeration
20%
Industrial Process Refrigeration
30%
1.2. Organization of this Document
The analysis contained in this document is organized as follows:
Chapter 2 summarizes the types of equipment affected by this rule. This includes equipment that
relies on HFCs in the fire suppression, commercial refrigeration, industrial process refrigeration, and
comfort cooling sectors. Using data from EPA's Vintaging Model, equipment is broken out by estimated
average charge size (in pounds of refrigerant) and assumed leak rate. These data are used as a basis for
estimating the scale of equipment affected by the leak repair and inspection provisions of this rule, as well
as the costs and benefits of compliance.
Chapter 3 provides a synopsis of the methodologies relied upon to estimate the primary costs and
benefits of this rule. Specific provisions analyzed include leak repair and inspection requirements,
requirements to install ALD systems, and associated recordkeeping and reporting requirements. This
chapter also summarizes the methodology for calculating the social cost of HFCs (SC-HFCs), also
described in detail in Section 4.1 of the Allocation Framework RIA. The SC-HFC values are given in
Appendix J.
Chapter 4 provides an assessment of the anticipated compliance costs and savings resulting from
leak repair and inspection provisions contained in the proposed rule. This chapter also provides an
analysis of the environmental benefits of these provisions. The reduction in emissions of these GHGs
yields social benefits by reducing climate impacts. These climate benefits are monetized by multiplying
the change in emissions of each regulated HFC by the SC-HFC value for that chemical.8
Chapter 5 provides a summary of anticipated costs and benefits for all provisions contained in the
proposed rule, including proposed leak repair and inspection requirements, proposed requirements for the
use of reclaimed HFCs, proposed cylinder management provisions, proposed fire suppression provisions,
and proposed recordkeeping and reporting requirements. The estimated present value of net incremental
benefits (benefits minus costs) is provided for all rule provisions.
8 Although EPA is using SC-HFCs for purposes of some of the analysis in this document, the proposed action does not rely on
those estimates of these costs as a record basis for the Agency action. EPA would reach the proposed conclusions even in the
absence of the social costs of HFCs.
16
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Chapter 6 covers the environmental justice analysis conducted for the rule. This analysis builds on
the environmental justice analysis conducted for the Allocation Framework and Technology Transition9
Rules and evaluates the demographic characteristics and baseline exposure of the communities near
facilities that reclaim HFCs.
Appendix A provides details on leak rate assumptions derived from EPA's Vintaging Model and
relied on in this analysis.
Appendices B, C, and D provide an evaluation of potential costs and benefits of a subset of the
provisions contained in the proposed rule, including required use of reclaimed refrigerant for new
equipment and servicing and/or repair of appliances in specific RACHP subsectors, the required use of
recycled HFCs in fire suppression equipment, and the requirement that disposable cylinders that contain
HFCs and that have been used in the service, repair or installation of refrigerant-containing or fire
suppression equipment be sent to EPA-certified reclaimers or fire suppressant recyclers.
Appendix E provides a breakdown of estimated compliance costs and savings by affected
appliance/equipment type related to proposed leak repair and inspection provisions.
Appendix F and G provide sensitivity analyses of costs and benefits under alternative policy
scenarios considering a 5-pound threshold for annual leak repair and inspection of CC, CR, and IPR,
rather than 15 pounds, and a 500-pound threshold for ALD systems. These supplementary analyses are
provided for illustrative purposes.
Appendix H provides a Small Business Regulatory Enforcement Fairness Act (SBREFA) of 1996
analysis of estimated impact to small entities, including small businesses and small governments,
associated with establishing the leak repair and inspection provisions and ALD requirements to HFC and
substitutes for HFCs.
Appendix I lists the industries that might be affected by this rule.
Appendix J provides annual SC-HFC estimates used to estimate the climate benefits of this rule.
Appendix K analyzes certain restrictions in the proposed rule using an alternate methodology.
Specifically, restrictions related to leak repair and leak inspection, required use of reclaimed refrigerant,
and emission reductions in the fire suppression sector are analyzed using a marginal abatement cost
9 Phasedown of Hydrofluorocarbons: Restrictions on the Use of Certain Hydrofluorocarbons Under Subsection (i) the American
Innovation and Manufacturing Act of 2020 (AIM Act Technology Transitions Rule). (Docket No. EPA-HQ-OAR-2021-0643-
0073
17
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approach. This supplementary analysis builds on the approach taken in analyses conducted for the
Allocation Framework Rule RIA and the 2024 Allocation Rule RIA Addendum.
Appendix L provides a statement prepared in accordance with section 202(a) of the Unfunded
Mandates Reform Act (UMRA).
18
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2. Equipment Characterization
2.1. Equipment in the Fire Suppression Sector
Fire suppression equipment covered by this rule fall into two categories, and both types of equipment
may contain HFCs that would be discharged in the event of a fire. Total flooding systems are designed to
automatically discharge a fire extinguishing agent by detection and related controls (or manually by a
system operator) and achieve a specified minimum agent concentration throughout a confined space (i.e.,
volume percent of the agent in air) that is sufficient to suppress development of a fire. Streaming
applications use portable fire extinguishers that can be manually manipulated to discharge an agent in a
specific direction and release a specific quantity of extinguishing agent at the fire.
2.2. Refrigeration and Comfort Cooling Appliances
A variety of RACHP appliances used in the United States contain refrigerants, and these appliances
can be organized into the following charge size groups: 1) appliances containing five or fewer pounds of a
refrigerant containing an HFC or substitute for an HFC, 2) appliances containing between five and 15
pounds of such refrigerant, and 3) appliances containing more than 15 pounds of such refrigerant. For this
analysis, affected equipment is considered to be refrigeration and AC appliances containing 15 pounds or
more of a refrigerant containing an HFC or substitute for an HFCs.
Figure 2-lError! Reference source not found, shows the projected installed stock of HFC refrigerant by
RACHP appliance type across all equipment sizes in the United States in 2025, as modeled in EPA's
Vintaging Model (EPA 2023a)10 and Figure 2-2 shows annual leak emissions (exclusive of loss during
disposal) by appliance type in 2025. These appliances contain approximately 1.0 million MT (2.2 billion
pounds) of HFC refrigerant and are estimated to release approximately 82,000 MT (180 million pounds)
of HFC refrigerant in 2025; an aggregate average leak rate of 8.2%. Table 2-1 summarizes stock and leak
emissions in 2025 for each appliance type.
10 As explained in the RIA to the Allocation Framework Rule and associated addenda to that RIA, the Vintaging Model estimates
the consumption and emissions from subsectors that traditionally relied on ODS and are transitioning to HFCs and other
alternatives. The EPA 2023 version of the model incorporates the transitions and practices anticipated to occur under the 2024
Allocation Rule. Other or different transitions as modeled under the Technology Transitions RIA addendum are not specifically
included in this version of the Vintaging Model because at the time of this writing, EPA had not issued any final rule related to
the Technology Transitions proposed rule.
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Figure 2-1 - Projected Installed Stock (MT) of HFC Refrigerant by RACHP Appliance Type and Charge
Size (2025)
RefTransport
(>15 lbs)
RefTransport
(5-15 lbs)
Commercial Ref
(5-15 lbs)
Unitary AC and HPs
(5-15 lbs)
Unitary AC and HPs
(>15 lbs)
Buses, Trains
(5-15 lbs)
Buses,Trains
(>15 lbs)
Figure 2-2 - Estimated leak Emissions (MT) of HFC Refrigerant by RACHP Appliance Type and Charge
Size (2025)
RefTransport (>15 lbs)
RefTransport (5-15
lbs)
Small Appliances (<5
Ibs)
Commercial Ref (5-15
lbs)
Unitary AC and HPs (5-
15 lbs)
Unitary AC and HPs
(>15 lbs)
Buses, Trains (5-15 lbs)
Buses, Trains (>15 lbs)
Chillers (>15 lbs)
IPR (>15 lbs)
20
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Table 2-1. Estimated Installed Stock (MT) and Leak Emissions (MT) by Equipment Type (2025)
Equipment Type
Installed Stock
(MT)
% of Total
Installed Stock
Leak Emissions (MI)
% of Total
Leak
Emissions
MVAC (<5 lbs)
165,600
17%
14,000
17%
Unitary AC and HPs (<5
lbs)
367,100
37%
38,400
47%
Small Appliances (<5 lbs)
75,100
8%
400
0.5%
<5 lbs total
607,800
52,800
Buses, Trains (5-15 lbs)
2,400
0.2%
200
0.2%
Ref Transport (5-15 lbs)
5,600
1%
1,700
2%
Commercial Ref (5-15 lbs)
8,100
1%
400
0%
Unitary AC and HPs (5-15
lbs)
25,500
3%
2,000
2%
5-15 lbs total
41,600
4,300
Buses, Trains (>15 lbs)
700
0.1%
50
0.1%
Chillers (>15 lbs)
179,400
18%
2,300
3%
IPR (>15 lbs)
72,000
7%
5,200
6%
Commercial Ref (>15 lbs)
71,100
7%
15,200
19%
Ref Transport (>15 lbs)
5,000
1%
1,600
2%
Unitary AC and HPs (>15
lbs)
2,500
0.3%
200
0.2%
>15 lbs Total
330,700
24,600
Total
980,100
81,700
2.3. Affected Equipment
CR, CC, and IPR equipment containing 15 pounds or more of HFC refrigerant11 were identified using
EPA's Vintaging Model. The appliance types within each sector include:
• Commercial refrigeration systems are the refrigeration appliances used in the retail food
and cold storage warehouse sectors and refrigerated transport systems. Retail food appliances
include the refrigeration equipment found in supermarkets, convenience stores, restaurants,
and other food service establishments and include multiplex rack systems and condensing
unit systems. Cold storage systems include the equipment used to store meat, produce, dairy
products, and other perishable goods. Refrigerated transport systems include the equipment to
move perishable goods (e.g., food) and pharmaceutical products by various modes of
transportation, including rail and ships.
• Industrial Process Refrigeration systems are complex, customized systems used in the
chemical, pharmaceutical, petrochemical, and manufacturing industries. These systems are
11 Although the proposed rule also covers substitutes for an HFC, this analysis focuses on HFCs and HFC-containing blends,
including HFC-containing substitutes, noting that most other HFC substitutes modeled have small to zero GWPs (e.g.,
hydrocarbons, hydrofluoroolefins, carbon dioxide, and ammonia).
21
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directly linked to the industrial process. This sector also includes industrial ice machines,
appliances used directly in the generation of electricity, and ice rinks.
• Comfort Cooling includes stationary refrigeration equipment that provides cooling in order
to control heat and/or humidity in occupied facilities, such as office buildings and
commercial buildings, and mobile AC equipment. Comfort cooling appliances include
building chillers (which can be further broken down by compressor type) and mobile AC for
transit, school, and tour buses and passenger trains.
Additional description of the Vintaging Model end-uses within each sector and equipment
category is provided in Appendix A.
The Vintaging Model models equipment using average charge sizes. To provide additional
variation in potential costs and benefits for larger equipment where a more significant range of possible
charge sizes is likely (i.e., equipment containing more than 50 pounds of refrigerant), these end-uses were
distributed into "small" (i.e., 50 percent of the modeled average charge size), "medium" (i.e., the modeled
average charge size), and "large" (i.e., 150 percent of the modeled average charge size) groups. Each
group was assigned one-third of the total units, and the charge size distributions equal the weighted
average charge size modeled in the Vintaging Model. Each end-use was then categorized as sub-small
(containing between 15 and 50 pounds of refrigerant), small (containing between 51 and 199 pounds of
refrigerant), medium (containing between 200 and 1,999 pounds of refrigerant), and large (containing
greater than 2,000 pounds of refrigerant).
Only RACHP appliances that experience leaks that exceed the annual leak threshold are subject
to repair and inspection requirements and thus incur compliance costs to inspect the equipment and repair
those leaks. The proportion of appliances above the leak rate thresholds for all equipment containing 15
pounds or more of refrigerant was based on equipment stock estimated in the Vintaging Model. Because
the Vintaging Model models equipment using average leak rates,12 equipment stock was distributed into
quintiles, each containing 20 percent of units, where the leak rate distributions equal the weighted average
leak rate modeled in the Vintaging Model for each equipment type. Based on this approach, it is assumed
that each subsector has at least 20 percent of its stock (i.e., one quintile) above the threshold leak rate. See
Appendix A for more detail.
12 For chillers, large retail food (rack systems), cold storage, and industrial process refrigeration systems, the leak rate
distributions were applied to the average leak rate modeled in the Vintaging Model as of 2025 with a 40 percent leak rate
reduction, which is consistent with the assumption that larger refrigeration and AC equipment will experience enhanced leak
recovery under the 2024 Allocation Rule as explained in the RIA to the Allocation Framework Rule and associated addenda to
that RIA.
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Table 2-2 presents the assumptions made for this analysis regarding the proportion of affected
appliances experiencing leaks above the threshold.
Table 2-2: Affected Appliance Assumptions by Equipment Sector, Type, and Size
_ . f a , Percentage of Appliances
Appliance Sector Equipment Type '^Size^ ^^Size (tbly^ Experiencing Leaks Above the
Threshold Rate
Comfort Cooling
School & Tour
Bus ACb
Sub-small
16
13%
Transit Bus AC
Sub-small
16
40%
Passenger Train
AC
Sub-small
41
20%
Chiller
Medium
265 - 1,985
20%
Large
2,084 - 2,786
20%
Commercial
Refrigeration
Modern Rail
Transport0
Sub-small
17
80%
Vintage Rail
Transport0
Sub-small
33
80%
Condensing Unit
Sub-small
47
20%
Marine Transport
Small
194
80%
Medium
388- 1,653
80%
Large
2,480
60%
Rack
Medium
986-1,972
20%
Large
2,959
20%
Cold Storage
Large
10,655-38,147
20%
Industrial Process
Refrigeration
IPR
Medium
1,049- 1,059
20%
Large
2,099-23,816
20%
3 For some equipment types, the Vintaging Model models multiple subsectors which are distinguished by size,
original ozone-depleting substances (ODS) refrigerant type, or technology. In those cases, a range is provided.
b 66 percent of School & Tour Bus AC units have charge sizes below the leak rate threshold of 15 lbs.
and therefore are not included as affected appliances (EPA 2023a).
0 The Vintaging Model models two subsectors for refrigerated rail car transport: vintage and modern. Modern rail
refrigeration systems are considered to be easily replaceable units previously developed for road transport and
adapted for rail use, have a lifetime of approximately 9 years, and a refrigerant charge size less than 20 pounds.
Older or vintage units were typically developed specifically for rail use and operate for the whole lifetime of the
railcar itself (i.e., 40 years) and have larger charge sizes than modern systems (EPA 2023a).
3. Methodology
3.1. Relationship to Prior Analyses and Approach for Estimating Incremental Impacts
EPA has previously estimated costs and benefits of the HFC phasedown, which are detailed in the
Allocation Framework RIA and 2024 Allocation Rule RIA Addendum. The proposed Subsection (h) Rule
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focusses on statutory provisions under the AIM Act that are separate from those addressed in the
Allocation Framework Rule. However, in order to avoid double counting or overestimating of costs and
benefits of the proposed action, for the purposes of this analysis the Allocation Framework Rule and 2024
Allocation Rule RIA Addendum are assumed to be the status quo from which incremental benefits may
be calculated.
This analysis does not consider the technology transitions that were included in the proposed
Phasedown of Hydrofluorocarbons: Restrictions on the Use of Certain Hydrofluorocarbons Under
Subsection (i) the American Innovation and Manufacturing Act of 2020 (AIM Act Technology
Transitions Rule) RIA Addendum. (Docket No. EPA-HQ-OAR-2021-0643-0073, Appendices C & D)
since, at the time of this writing, that rule has not been finalized.
As detailed in the Allocation Framework Rule RIA and 2024 Allocation Rule RIA Addendum, EPA
relied upon a Marginal abatement cost curve (MACC) approach in order to estimate the full set of HFC
abatement options and associated compliance costs required to meet the statutory phasedown caps from
2022-2050. Emissions benefits were then estimated based on the difference between HFC emissions in
the compliance pathway and HFC emissions under a BAU scenario without the statutory phasedown caps
in place. This previously modeled compliance path is referred to in this analysis as the "Allocation Rule
Reference Case."
The Allocation Rule Reference Case impacts EPA's assumptions regarding the projected incremental
impact of the proposed rule in the following ways:
1) Total HFC consumption and emissions over time for appliances across all major sectors
(including fire suppression, CC, IPR, and CR) is significantly lower (in carbon dioxide
equivalent (CC^e) terms) than it otherwise would be under a BAU scenario. Since this
analysis assumes these transitions and improved service activities occur in the reference case,
the estimated avoided emissions from some of the provisions contained in this proposed rule
are less than what they would be if a BAU scenario were used that does not assume these
transitions and improved service activities occur.
2) EPA assumes that under the Allocation Framework Rule, one possible result of proposed
provisions in this rule is that industry will maximize the use of allowances still available to
meet remaining demand for HFC production and consumption in a given year. Therefore,
certain provisions in this proposed rule (e.g., requiring the use of reclaimed HFCs for
refrigerant-containing equipment for certain RACHP subsectors and recycled HFCs for fire
suppression equipment) may not yield significant additional HFC consumption reductions,
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relative to what was previously modeled in the Allocation Rule Reference Case. For example,
if additional reclaimed HFCs are utilized in the commercial refrigeration subsector, industry
may still shift the use of available consumption and production allowances to import or
produce HFCs to meet demand for other sectors or subsectors that are not covered by a
reclaim requirement.
To represent the possibility that the use of allowances might not be maximized, the costs and
benefits of some proposed rule provisions are given as a range, with one end of the range being our "base
case" scenario, where we assume that decreases in consumption of virgin HFCs in one sector or subsector
is offset by an increase in consumption in some other sector or subsector, while the other end of the range
is a "high additionality" estimate assuming that decreases in consumption are additional and offsetting
allowance activity does not occur.
Despite the lower amounts of HFC consumption in the base case, as shown in chapter 4, the leak
detection and repair provisions of this rule are still projected to yield significant benefits due to avoided
emissions from the residual future demand for HFCs not phased out under the compliance path as well as
the existing stock of equipment containing HFCs.
EPA notes that the above assumptions are made for technical analytic purposes only and to avoid
double counting of benefits. They should not be interpreted as a reflection of the merits of any particular
provision contained in the proposed rule. EPA may also revisit these assumptions before finalization of
this rule or at a future date based on new information or public comment.
Moreover, there are likely significant benefits associated with provisions contained in the proposed rule
that are not quantified in the incremental benefits presented in this document. These include, but are not
limited to:
• the life-cycle cost savings associated with the use of reclaimed HFCs and substitutes for HFCs as
opposed to virgin HFCs and substitutes for HFCs;
• the moderation of future spikes in the cost of HFCs due to increased availability of reclaimed
HFCs;
• avoidance of stranded equipment in later years where if the market were reliant on virgin HFCs
scarcity could result in shortages;
• ensure demand for the cold chain for food and vaccines is met; and
• the freeing up of available virgin HFCs for applications where reclaimed HFCs cannot be used
(e.g., metered dose inhalers (MDIs) for treatment of asthma or Chronic Obstructive Pulmonary
Disease (COPD)).
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• Avoided supply shortages of HFCs that are still needed for servicing certain appliances, by
maximizing the supply of reclaimed refrigerant, thus protecting the cold chain needed to deliver
food and vaccines.
3.2. Costs and Benefits for Leak Repair and Inspection Provisions
The sections below describe the method and assumptions used to estimate aggregate incremental
costs and benefits associated with the Agency's proposed regulations related to leak repair and inspection.
3.2.1 Approach for Estimating Costs
The proposed rule provisions associated with leak repair and inspection are expected to result in:
• Incremental compliance costs associated with conducting leak detection/inspections and
repairs.
• Refrigerant savings associated with detecting and repairing leaks earlier.
Costs and savings were first estimated using a model equipment approach, and then were scaled up
industry-wide based on the total number of affected equipment using EPA's Vintaging Model and the
approach outlined in Section 2.3.
Leak Repair
The proposed regulation results in incremental compliance costs to owners and operators when leaks
in appliances containing 15 or more pounds of refrigerant containing an HFC or a substitute for an HFC
that has a GWP above 53 exceed the threshold leak rate. Owners and operators must repair leaks within
30 days, or, under certain circumstances, request an extension to conduct the repair. If leaks cannot be
repaired, the appliance must be retrofitted or retired. These requirements are incremental for owners and
operators of appliances containing 15 or more pounds of such refrigerant that exceeds the leak rate of 10
percent for CC, 20 percent for CR, or 30 percent for IPR equipment. When leaks are repaired, all
appliances must also conduct initial and follow-up verification tests.
Leak repair outcomes. Extending leak rate thresholds to these refrigerant-containing appliances
should result in leaks being identified and repaired sooner than previously assumed in the Allocation Rule
Reference Case previously evaluated by EPA. This analysis assumes that leaks will be detected and
repaired earlier across all CC, CR, and IPR appliances containing 15 pounds or more of HFC refrigerant.
Specifically, the analysis assumed that HFC appliances that experience a leak event requiring repair
realizes one of three outcomes:
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• The standard repair outcome conservatively assumes that as a result of the leak rate threshold,
repairs are conducted six weeks earlier than they would have been conducted when waiting for
the system performance to noticeably change due to refrigerant loss. If the system is using ALD
monitoring, repairs are assumed to be conducted ten weeks earlier.
• Under the extension repair outcome, owners/operators request an extension for conducting the
repair. The analysis conservatively assumes that repairs are also conducted six weeks earlier as a
result of the leak repair requirements (or ten weeks earlier if the system is using ALD
monitoring). As mentioned above, the extension allows owners/operators additional time to repair
an appliance if components cannot be delivered within the necessary time.
• The retrofit outcome assumes that systems that require retrofitting are retrofitted 5 years earlier
than they would have been in the absence of the proposed regulations (i.e., five years were
assumed to be remaining before normal end-of-life).
Table 3-1 Below shows the proportion of affected appliances assumed to experience each outcome.
Table 3-1: Leak Repair Outcomes and Proportions
Outcome
HFC Systems
Standard Repair
98%
Extension Repair
1%
Retrofit
1%
Frequency of repair. Data reported under California's Refrigerant Management Program (RMP) was
reviewed to determine an appropriate assumption for the annual frequency of repair for systems that use
ALD monitoring systems or are inspected annually or quarterly and are leaking above the threshold
annual leak rates proposed in this action. These data suggest that most systems greater than 50 pounds are
repaired once per year, with the exception of larger (>500 pounds) cold storage systems, which are
repaired about twice per year on average (CARB 2009a).13 This analysis assumes that there would be a
similar relationship between appliances that are subject to this proposed rule (under subsection (h) of the
AIM Act) as there is for the appliances subject to California's RMP.
Repair effectiveness and baseline leak rates. For all equipment types and sizes, post-repair leak
rates reflect California Air Resources Board (CARB) (2009a) estimates, which were based on EPA's
13 Cold storage systems that are repaired twice are assumed to follow a modified standard repair outcome. After the first leak is
repaired, the system is assumed to leak for six weeks (without ALD) or 10 weeks (with ALD) at the post-repair leak rate. At that
point, the system is assumed to experience a failure such that six weeks (without ALD) or 10 weeks (with ALD) after the original
repair the system has leaked a qualifying amount of refrigerant to require a second repair.
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Vintaging Model and Intergovernmental Panel on Climate Change (IPCC)/Technology and Economic
Assessment Panel (TEAP) (2005) recommendations. The modeled leak rates represent an outcome in
which a post-repair leak rate of zero is not achieved. This assumption therefore may be more conservative
than what may be actually achieved once this rule is implemented (i.e., this may assume more post-repair
leakage than actually occurs). This is because the GWP-weighted amount of emissions prevented by a
given leak repair equals the number of weeks multiplied by the difference of the leak rate pre-repair and
the leak rate post-repair) multiplied by the GWP of the refrigerant leaking. A higher post-repair leak rate
results in a lower change in leak rate, which results in a lower estimate of emissions prevented. On the
other hand, some owners and operators may choose to repair the leak to the point where the leak rate does
not trigger further leak repair, in which case the assumed non-zero post-repair leak rate may be more
reflective of actual industry behavior.
Table 3-2 below presents the final leak rate assumptions by equipment sector, type, and size for
equipment that is affected by the proposed leak repair requirements (i.e., is expected to leak above the
leak rate thresholds).14 The percentage of each equipment type that is experiencing a qualifying leak was
presented earlier in Table 2-2.
Table 3-2: Leak Rate Assumptions by Equipment Sector, Type, and Size
Leak Rate
Threshold
Appliance
Sector
Equipment
Type
Equipment
Size
Baseline Annual Leak Rate (for
Equipment Requiring Repair)
Annual Post-
repair Leak
Rate
10%
CC
School & Tour
Bus AC
Sub-small
13%
10%
Transit Bus AC
Sub-small
14%
8%
Passenger Train
AC
Sub-small
10%
2%
Chiller
Medium
10%- 11%
2%
Large
10%
2%
20%
CR
Modern Rail
Transport
Sub-small
37%
19%
Vintage Rail
Transport
Sub-small
42%
15%
Condensing
Unit
Sub-small
22%
15%
Small
37%
10%
14 The average baseline annual leak rates shown in Table 3-2 are based on actual leak rate data reported to the CARB RMP. For
sub-small equipment, the annual post-repair leak rates are based on the average Vintaging Model leak rate (if lower than the leak
rate threshold for the equipment type) or the quintile 1 or quintile 2 leak rate from the modeled leak rate distributions (see
Appendix A for more information).
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Leak Rate
Threshold
Appliance
Sector
Equipment
Type
Equipment
Size
Baseline Annual Leak Rate (for
Equipment Requiring Repair)
Annual Post-
repair Leak
Rate
Marine
Transport
Medium
29% - 37%
10%
Large
29%
10%
Rack
Medium
22%
10%
Large
22%
10%
Cold Storage
Large
20% - 25%
10%
30%
IPR
IPR
Medium
30% - 34%
7%
Large
30% - 34%
7%
Source: EPA (2023a)
Leak Inspection
The proposed regulations would result in incremental compliance costs to appliance owners and
operators who would need to conduct leak inspections when leaks are identified that exceed the annual
threshold leak rate (i.e., 10% for CC, 20% for CR, or 30% for IPR). For CR and IPR systems with charge
sizes between 15 and 500 pounds and for CC and other appliances with charge sizes at or above 15
pounds, leak inspections are annual, and for CR and IPR systems with charge sizes between 500 and
1,500 pounds, leak inspections are quarterly. As a baseline, the cost analysis conservatively assumes that
annual leak inspections are not currently performed. This assumption may overestimate compliance costs
since, some owners and operators have indicated they conduct regular leak inspections to ensure that
systems continue to function properly, to avoid recurring refrigerant top-off costs, or they are required to
do so based on state regulations. Although the cost analysis assumes no annual leak inspections in the
baseline, when estimating baseline emissions, the real-world prevalence of ALD in each subsector is
empirically captured in the average leak rates in the Vintaging Model (i.e., unlike costs, emissions are not
conservatively estimated, nor are they overestimated due to this assumption). For CR and IPR systems
with charge sizes above 1,500 pounds, ALD monitoring is required, so no additional inspections are
assumed for these appliances. The incorporation of ALD in the model partially ameliorates the
overestimation of costs for leak inspection but does not account for all overestimation due to current leak
inspection practices.
Unit Cost and Savings Assumptions
Leak inspection. Leak inspections were assumed to require, on average, four hours per system per
inspection for CR and IPR appliances, and two hours for CC appliances.
29
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An hourly labor rate of $55.21 was assumed for leak repair and inspection, based on the median
hourly earnings of $26.29 for the Heating, Air-conditioning, and Refrigeration Mechanics and Installers
occupational group (49-9021) from the Bureau of Labor Statistics (BLS 2022), plus 110 percent to
account for overhead ($28.92). All costs in this report are reported in 2022 dollars, unless otherwise
noted.
ALD systems. Direct and indirect ALD system costs include the capital expenditure to purchase the
hardware (e.g., detector, sensors), plus installation costs and operations and maintenance (O&M) costs
associated with annual system maintenance, certification, and data tracking/storage. These costs are
assumed to vary by system size (e.g., number of zones and sensors) and are summarized in Table 3-3,
with direct ALD systems requiring higher material and installation costs than indirect systems because a
separate monitoring device and zone sensors are required (see Technical Support Document (TSD)15
titled American Innovation and Manufacturing Act of2020 - Subsection (h): Automatic Leak Detection
System) for more information). For the purposes of this analysis, 50 percent of equipment owners were
assumed to install direct ALD systems, which offer additional monitoring capabilities that automatically
provide certain reporting and recordkeeping requirements, and 50 percent of equipment owners are
assumed to install indirect ALD systems. In the first year of the proposed regulation, equipment owners
of all CR and IPR appliances containing 1,500 pounds or more of refrigerant would be required to
purchase and install an ALD system (assuming 10-21 percent of existing and new equipment would
already have regularly calibrated ALD systems installed16), which is assumed to last the full lifetime of
the equipment. In subsequent years, new equipment entering the market would also experience costs to
purchase and install an ALD system. The upfront costs to purchase and install a direct ALD system were
annualized over a 5-year period using a rate of 9.8 percent,17 whereas indirect ALD system owners are not
assumed to finance the material and installation costs. Owners and operators were also assumed to
experience annual O&M costs throughout the life of the ALD system.
15 Available in the docket (EPA-HQ-OAR-2022-0606) for this rulemaking at https://www.regulations.gov.
16 This assumes that 10 percent of CR and IPR equipment under 1,500 lb would have ALD already installed or would be
expected to install ALD in the absence of this rulemaking, 16 percent of appliances 1,500-2,000 lb, and that 21 percent of CR
and IPR equipment have ALD as required in California (based on population of California relative to the United States) for
appliances greater than 2,000 lb.
17 Businesses are expected to treat ALD systems as capital assets and therefore it is assumed that businesses would be able to
access financing for their purchase, if desired, for a loan tenure of five years. The discount rate used in this analysis is consistent
with the RIA to the Allocation Framework Rule, which identified a weighted average cost of capital in this sector of 9.8 percent
(EPA 2023a).
30
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Table 3-3: Unit Cost Assumptions for ALD Systems
System Size
Material
Cost
Labor
Hours
Installation
Cost
Equipment and
Installation Cost
Annualized Equipment
and Installation Cost
(Years 1-5)
Annual
O&M Cost
Direct ALD System
1,500-2,000
$9,000
16
$883
$9,880
$2,594
$1,250
2,000+
$9,850
20
$1,104
$10,950
$2,875
$1,440
Indirect ALD System
1,500-2,000
$2,850
8
$440
$3,290
NA
$950
2,000+
$2,650
10
$550
$3,200
NA
$1,000
Source: Abt (2023)
Leak repair. Repair costs are calculated as the base cost of making the repair or retrofit, including
labor, parts, refrigerant recovery, and verification tests.18 These costs are assumed to vary by system size,
where leak repairs on a sub-small or small system are assumed to be relatively simpler and less costly
than repairs on medium and large systems. The base costs associated with each outcome were estimated
as described below.
• Standard repair. Leak repair costs for a "standard repair" are based on assumptions in CARB
(2009a). CARB (2009a) surveyed RACHP service contractors and technicians to validate these
cost assumptions. Although the CARB estimates did not cover appliances with charge sizes less
than 50 pounds, repair costs for these smaller appliances were extrapolated from the CARB
estimates.
• Extension repair. An "extension repair" is assumed to involve the repair of a major component
such as a compressor and is based on costs presented in Stratus (2009).19
• Retrofit. Retrofit costs were also based on Stratus (2009); this analysis assumed that the cost to
retrofit an entire appliance was between two to three times the cost of the compressor or major
component.
As noted above, lower leak rate thresholds will result in leaks being repaired sooner than under the
current approach. The analysis assumes that repairs are conducted six or ten weeks earlier as a result of
these requirements. Thus, the repair costs attributable to the rule are based on the time cost of conducting
18 Industry input suggested that verification tests are already conducted as standard practice during servicing events. Moreover,
because initial and follow-up verification tests can both be conducted during the same service appointment, this requirement is
not expected to result in additional servicing events. Time required to conduct the verification tests is included in the estimated
time to conduct the repair.
19 Stratus (2009) obtained estimates of retail prices for typical replacement compressors from a supplier (ThennaCom Ltd.).
31
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those repairs six or ten weeks earlier. The interest cost (at 7 percent and 3 percent per year) of the base
repair cost is attributed to the rule; this cost is referred to below as the "effective cost of repair/'2"
An "effective cost'' approach was also taken for the cost of retrofitting. Appliances that are retrofitted
as a result of the proposed regulation are assumed to be retrofitted five years earlier than they would have
been under current practices. Thus, the effective cost of retrofitting attributable to the rule is the cost of
borrowing the funds for retrofitting for five years at 7 percent (or 3 percent) per year.
Table 3-4 below presents the base and effective cost assumptions by repair, appliance charge size, and
whether the appliance is using ALD. For retrofit outcomes, the base costs presented do not include the
additional cost of replacing the entire refrigerant charge with virgin refrigerant. These costs can be sizable
considering, for instance, charge sizes can exceed 10,000 pounds in some systems. For the standard and
extension repair outcomes, the cost of refrigerant recharge is not included since it is assumed that the
owner or operator would have topped off the system in the absence of the regulatory requirements.
Table 3-4: Unit Cost Assumptions for Leak Repairab,c
Appliance Size
Total
Labor
Hours
Parts
Refrigerant
Recovery
Total Base
Cost for
Labor,
Parts, and
Recovery
Effective Cost of Early
Repair /Retrofit
(without ALD)
Effective Cost of
Early Repair /
Retrofit
(with ALD)
7% Discount
Rate
3%
Discount
Rate
7%
Discount
Rate
3%
Discount
Rate
Standard Repair
Sub-small, Small
8
$135
$269
$846
$7.4
$3.2
-
-
Medium
12
$404
$471
$1,538
$13.5
$5.8
$22.4
$9.6
Large
16
$808
$876
$2,567
$22.5
$9.6
$37.4
$16.0
Extension Repair
Sub-small, Small
20.25
$3,501
$269
$4,888
$42.8
$18.3
-
-
Medium
20.25
$12,768
$471
$14,358
$126
$53.8
$209
$89.7
Large
20.25
$12,768
$876
$14,762
$129
$55.4
$215
$92.3
Retrofit0
Sub-small, Small
20.25
$10,297
$269
$11,684
$2,603-$2,761
$1,272-
$1,349
-
-
Medium
20.25
$27,459
$471
$29,048
$6,671-$8,197
$3,259-
$4,005
$7,902-
$8,185
$3,861-
$3,999
Large
20.25
$27,459
$876
$29,452
$8,373-$8,996
$4,091-
$4,395
$8,387-
$40,339
$4,098-
$19,709
20 CARB used a similar approach—i.e., estimating the effective cost of repair—in developing its economic impact estimates for
its High-Global Wanning Potential Stationary Source Refrigerant Management Program (CARB 2009b).
32
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Source: for Standard Repair Labor Hours, Parts, and Recovery Costs: CARB (2009a); for Extension Repair and Retrofit: Stratus
(2009).
a Assumptions for small appliances were proxied for sub-small equipment containing between 15 and 50 49 pounds of
refrigerant.
b Total base cost is calculated by multiplying the total labor hours by the labor rate ($55.21) and adding the additional costs
associated with parts and refrigerant recovery.
c Effective costs for repair and retrofit of appliances varies based on the charge size of the appliance replaced.
Refrigerant savings. By causing leaks to be repaired earlier, the proposed regulations would result in
refrigerant cost savings for system operators. Refrigerant cost savings are calculated based on the
difference between the baseline and post-repair leak rates, multiplied by the charge size, over the six
weeks earlier that each repair was conducted (or ten weeks earlier for appliances using an ALD system).
An average price of $4 per pound was assumed for all refrigerants, based on the average price of HFC-
134a, R-404A, R-407A and R-507 assumed in the RIA for Phasing Down Production and Consumption
of HFCs (EPA 2021).
On a per system basis, effective refrigerant savings range from $0.29 for sub-small school bus AC up
to $4,718 for large IPR systems (EPA 2023a).
Leak repair expected costs and savings. Expected costs and burden reductions per model appliance
were estimated on a weighted basis, taking into account the proportion of appliances assumed to reach
each leak repair outcome and the unit costs and savings associated with each outcome. Expected costs and
savings were estimated in the Vintaging Model in a disaggregated manner, distinguishing between
appliance sectors, types, sizes, and refrigerant type (EPA 2023a).
3.2.2 Approach for Estimating Benefits
Annual Benefits of Leak Repair and Inspection
Similar to the methodology for estimating costs and savings, benefits were estimated using a model
equipment approach. For equipment with 15 or more pounds of refrigerant containing an HFC or a
substitute for an HFC that has a GWP above 53, benefits were scaled up industry-wide based on the total
number of affected equipment using EPA's Vintaging Model and the approach outlined in Section 2.3.
Benefits are calculated as the refrigerant emissions prevented by repairing or retrofitting a leaking
system earlier than would have been done if waiting for the system performance to decline. EPA
estimates this to be on average six weeks (or ten weeks if systems are using ALD monitoring). Avoided
refrigerant emissions are calculated based on the difference between the baseline and post-repair leak
rates (shown in Section 0 above), multiplied by the charge size, over the six weeks or ten weeks earlier
that each repair was conducted. The amount of avoided refrigerant emissions is weighted by an average
33
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GWP. For all equipment types, weighted-average GWPs are based on average charge sizes, refrigerant
type, and stock of affected equipment modeled in the Vintaging Model (EPA 2023a).
Table 3-5: Average 2025 GWP Assumptions by Equipment Type, Size, and Refrigerant Type
Sector
Equipment Type
Equipment Size
Weighted-Average GWP
School & Tour Bus AC
Sub-Small
1,430
Transit Bus AC
Sub-small
1,430
CC
Passenger Train AC
Sub-small
1,602
Chiller
Medium
1,160- 1,624
Large
1,244- 1,533
Modern Rail Transport
Sub-small
2,676
Vintage Rail Transport
Sub-small
1,430
Condensing Unit
Sub-small
3,035
Small
3,623
CR
Marine Transport
Medium
2,814-3,623
Large
2,814
Rack
Medium
2,743
Large
2,743
Cold Storage
Large
3,937
IPR
IPR
Medium
1,430- 1,675
Large
1,430-3,192
Source: EPA (2023a)
The benefits for the extension repair are assumed to be equivalent to the benefits of a standard repair.
This analysis does not take into account the additional 30 days (or longer) that the system is leaking
between filing the extension and when the actual repair takes place, which could result in overestimating
the avoided emissions as a result of the extension request. However, because systems requiring an
extension repair have typically more complicated or catastrophic leaks, an extension repair as a result of
the proposed regulations would still be taking place earlier than it would under the baseline scenario, and
emissions would still be avoided.
Although emission benefits associated with retrofit are anticipated, none are calculated in this
analysis. The benefits associated with retrofit fall outside of the one-year timeframe of this analysis (i.e.,
end users have 30 days to make the initial repair, 30 days to prepare and submit a retrofit plan, and then a
full year to complete the retrofit and repair all additional leaks), and thus are not included. Furthermore,
because this analysis only considers a one-year period, it does not include benefits from preventing a
chronically leaking system from continued operation over a longer time period than one year.
34
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On a per appliance basis, effective benefits range from 0.05 metric tons of carbon dioxide (CO2)
equivalent (MTCC^eq) for sub-small school bus AC systems up to 2,477 MTCC^eq for very large cold
storage refrigeration systems (EPA 2023a).
Model Equipment Expected Benefits. Expected benefits per model equipment were estimated on a
weighted basis, taking into account the proportion of equipment assumed to reach each leak repair
outcome (see Table 3-1 above) and the avoided refrigerant emissions associated with each outcome.
Expected benefits were estimated in the model in a disaggregated manner, distinguishing between
equipment sectors, types, sizes, and refrigerant type. The expected avoided refrigerant emissions per
model equipment type (as described above) were multiplied by the number of each type of equipment
assumed to experience leaks above the rule's threshold leak rates (see Table 2-2Error! Reference source
not found, above). This yields aggregate benefits for the United States as a whole as shown in Table
3-6Error! Reference source not found, below.
Table 3-6: Expected Emissions Reductions in 2025 by Equipment Type and Size
Sector
Equipment Type
Equipment Size
GHG Emissions
Avoided (MTCOzeq)
School & Tour Bus AC
Sub-small
3,000
Transit Bus AC
Sub-small
1,800
CC
Passenger Train AC
Sub-small
1,100
Chiller
Medium
512,500
Large
17,900
Modern Rail Transport
Sub-small
1,400
Vintage Rail Transport
Sub-small
2,200
Condensing Unit
Sub-small
61,400
Small
74,700
CR
Marine Transport
Medium
383,200
Large
11,500
Rack
Medium
306,700
Large
353,900
Cold Storage
Large
185,500
IPR
IPR
Medium
36,000
Large
1,849,200
35
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Future Annual Benefits of Leak Repair and Inspection
The analysis described above estimates one-year benefits based on the current distribution of HFC
appliances in use. However, because the use of HFCs will change over the next decade due to the phase-
down of HFCs in accordance with the AIM Act 2024 Allocation Rule, benefits for the proposed
regulations to the program will also change. Future benefits were estimated using a model equipment,
facility, and entity approach. Benefits were then scaled up industry-wide based on the total number of
affected appliances anticipated in 2030, 2040, and 2050.
Several assumptions were made to simplify the process of determining the number of affected appliances
and the benefits of leak repair in 2030, 2040, and 2050:
• Appliances used in later years are assumed to have the same leak rates and charge sizes as those
in the 2025 baseline scenario.
• The same proportion of standard repairs, extension repairs, and retrofits are assumed for all years.
• The affected HFC appliances in 2025 are assumed to grow according to the growth rate, lifetime,
and transitions in EPA's Vintaging Model—with the adjustments described below.
The growth in stock of HFC appliances was adjusted to account for the Allocation Framework rule and
the 2024 Allocation Rule RIA addendum. Benefits from the transition away from HFCs were quantified
and recently presented in the RIA for the EPA final rulemaking, Phasedown ofHydrofluorocarbons:
Allowance Allocation Methodology for 2024 and Later Years (AIM Act 2024 Allocation Rule) (Docket
No. EPA-HQ-OAR-2022-0430) (EPA 2022a). To avoid double-counting benefits, this analysis assumes
that HFC CR, CC, and IPR appliances begin transitioning away from HFCs in accordance with the
transition scenario presented in the RIA Addendum for the AIM Act 2024 HFC Allocation Rule.21
Appliance-specific average GWP values were also updated to reflect the specific mix of HFC refrigerants
assumed in 2030, 2040, and 2050, as shown in Table 3-7Error! Reference source not found.. GWP
values in 2030, 2040, and 2050 include HFCs and substitutes alternatives such as HFOs and HCFOs, but
did not include other substitutes such as CO2, ammonia, or hydrocarbons.22 Affected equipment modeled
in EPA's Vintaging Model, which was the basis for the RIA analysis for the AIM Allocation Framework
Rule and the RIA Addendum for the 2024 Allocation Rule, were distributed into three size categories (as
21 Different types of appliances are assumed to transition in different years as presented on pp. 72-74 of the 2024 Allocation Rule
RIA Addendum (EPA 2022a).
22 Given the GWPs of HFOs, HCFOs, CO2, ammonia, and hydrocarbons are very low compared to regulated EtFCs, the is not
expected to affect the weighted-average GWP significantly.
36
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discussed in Section 2.3) and therefore all size categories for some equipment types have the same
weighted-average GWP.
Table 3-7: Average GWP Assumptions by Equipment Type, Size, and Refrigerant Type for 2030,
2040, and 2050
Sector
Equipment Type
Equipment Size
Weighted-Average GWP
2030
2040
2050
CC
School & Tour Bus
AC
Sub-small
1,430
1,430
1,430
Transit Bus AC
Sub-small
1,430
1,430
1,430
Passenger Train AC
Sub-small
1,602
1,602
1,602
Unitary AC
Sub-small
1,717
836
730
Chiller
Medium
907-
1,394
229-839
6-698
Large
1,030-
1,122
688-716
435 -618
CR
Modern Rail
Transport
Sub-small
2,676
2,676
2,676
Vintage Rail
Transport
Sub-small
1,430
-
-
Condensing Unit
Sub-small
2,611
1,966
1,966
Marine Transport
Small
3,654
3,662
3,662
Medium
2,812-
3,654
2,811-
3,662
2,811-
3,662
Large
2,812
2,811
2,811
Rack
Medium
2,518
2,479
2,479
Large
2,518
2,479
2,479
Cold Storage
Large
3,937
3,937
-
IPR
IPR
Medium
1,430-
1,693
1,430-
1,701
-
Large
1,430-
3,191
1,430-
3,191
-
Note: By 2040, there are no longer any HFC refrigerants assumed in vintage rail transport systems. By 2050, there
are no longer any HFC refrigerants assumed in cold storage and IPR systems.
Benefits on a per-appliance basis were then calculated in the same manner outlined in Section 0 and were
multiplied by the estimated affected appliances in 2030, 2040, and 2050 described above as shown in
Table 3-8.
Table 3-8: Expected Emissions Reductions by Equipment Type, Size, and Refi'igerant Type for
2030, 2040, and 2050
Sector
Equipment Type
Equipment Size
MTC02eq
2030
2040
2050
CC
School & Tour
Bus AC
Sub-small
3,300
3,800
4,100
Transit Bus AC
Sub-small
2,000
2,300
2,500
Passenger Train
AC
Sub-small
1,200
1,300
1,400
Chiller
Medium
479,800
218,600
131,500
37
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Large
15,800
12,200
9,300
CR
Modern Rail
Transport
Sub-small
1,500
1,600
1,700
Vintage Rail
Transport
Sub-small
800
-
-
Condensing Unit
Sub-small
57,300
44,200
48,700
Marine Transport
Small
97,000
123,800
139,600
Medium
498,400
635,500
716,300
Large
15,200
19,200
20,900
Rack
Medium
304,700
335,000
365,400
Large
351,600
386,500
421,600
Cold Storage
Large
160,100
64,100
-
IPR
IPR
Medium
29,900
13,400
-
Large
1,774,400
922,300
-
Note: By 2040, there are no longer any HFC refrigerants assumed in vintage rail transport systems. By 2050, there
are no longer any HFC refrigerants assumed in cold storage and IPR systems.
3.3. Costs and Benefits for Reclamation Provisions
The proposed requirement to use reclaimed refrigerant to fill new equipment and service existing systems
across numerous refrigeration and AC subsectors would reduce the need for virgin production of
refrigerant, which some research indicates could result in cost-savings and benefits. Yasaka et al. (2023)
performed a life cycle assessment for the virgin production, destruction, and reclamation of R-41 OA,
HFC-32, and HCFC-22 in Europe and Japan and found that the reclamation process had lower energy
consumption and costs and emitted fewer GHG emissions compared to production and destruction,
regardless of the refrigerant type or plant location. Because these cost and emission estimates aren't
available specifically in the United States context, cost savings and benefits are not directly incorporated
into the overall compliance costs and benefit estimates associated with this rulemaking; however, an
analysis of potential cost savings and benefits estimated by applying the incremental costs and emissions
associated with virgin production, destruction, and reclamation to estimated demand for new equipment
and servicing are presented for reference in Appendix B.
3.4. Costs and Benefits Related to Alternative Standards for Reclamation
The purpose of the RCRA alternative standards for ignitable spent refrigerant proposed in this rule is to
help reduce emissions of ignitable spent refrigerants to the lowest achievable level by maximizing the
recapture and safe reclamation/recycling of such refrigerants during the maintenance, service, repair, and
disposal of appliances. To the extent that the new alternative standards incentivize reclamation of
ignitable spent refrigerant over disposal, the RCRA alternative standards would result in the same type of
life cycle benefits that the proposed required use of reclaimed refrigerant to fill new equipment and
38
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service existing systems would garner. The proposed RCRA alternative standards also are expected to
result in an overall reduction in compliance cost for management of ignitable spent refrigerant under
RCRA. Avoided costs include reduced transportation cost (hazardous waste manifest and transporter not
required under the alternative standards), avoided compliance cost of complying with hazardous waste
generator regulations for appliance owners and technicians, and avoided hazardous waste incineration
costs for recovered ignitable spent refrigerant. Offsetting these avoided costs would be the cost to
reclaimers for meeting the new standards for emergency preparedness and response, and for documenting
that the ignitable spent refrigerant is not speculatively accumulated.
Because these cost estimates are heavily dependent on the future market for ignitable spent refrigerant
sent for reclamation, which is difficult to predict with currently available data, cost savings and benefits
of the proposed RCRA standards are not directly incorporated into the overall compliance costs and
benefit estimates associated with this rulemaking. However, because the alternative RCRA standards are
voluntary, and regulated entities can always choose to continue to comply with the full RCRA standards
if that is the economically preferred option, EPA anticipates that the proposed RCRA alternative
standards would either be economically neutral or result in an overall cost saving and increase in
reclamation of ignitable spent refrigerants.
3.5. Costs and Benefits for Handling of Disposable Cylinders and Container Tracking
EPA is proposing to require that disposable cylinders that contain HFCs and that have been used for the
servicing, repair, or installation of refrigerant-containing equipment or fire suppression equipment must
be sent to an EPA-certified reclaimer or a fire suppressant recycler. EPA is proposing that the EPA-
certified reclaimer or fire suppressant recycler who receives the disposable cylinder must remove all the
HFCs before disposing of the cylinder.
EPA is proposing that disposable and refillable containers of HFCs that could be used for servicing,
repair, or installation of refrigerant-containing equipment or fire suppressant equipment must include a
machine-readable tracking identifier.23 EPA is also proposing certain requirements for the registration in a
tracking system used to generate machine-readable tracking identifiers as well as update tracking
information as containers of HFCs moves in the distribution chain. Additionally, EPA is proposing
23 As noted in the proposal for this rulemaking, EPA established certain requirements for use of refillable cylinders and a QR
codes system of tracking under the Allocation Framework Rule. Those requirements were subject to judicial review in the D.C.
Circuit, and the court concluded that "EPA has not identified a statute authorizing its QR-code and refillable-cylinder
regulations" and therefore vacated those parts of the rule and remanded to the EPA. Heating, Air Conditioning & Refrigeration
Distributors Int'l v. EPA, 71 F.4th 59, 68 (D.C. Cir. 2023) ("HAKDI v. EPA"). The court rejected the other challenges to the
Allocation Framework Rule in this litigation. Id. at 61.
39
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requirements for the tracking of the disposable and refillable cylinders as they are sent to an entity either
capable of removing the remaining heel or, in the case of refillable cylinders, refilling the cylinder.
Currently, users of cylinders arrange for the handling and transportation of used cylinders to recycling
facilities. The provisions requiring transporting the used cylinders to a reclaiming facility is not expected
to increase costs on the cylinder user, as the same handling and transportation will be needed, only to a
different site. In some instances, reclaimers may even arrange the collection of used cylinders to
maximize their acquisition of raw material for their business, and this could result in cost savings for
users of refillable and disposable cylinders. The costs of reclaimers receiving used cylinders is covered
under recordkeeping and reporting costs. An analysis of the estimated incremental climate benefits of
cylinder provisions proposed in this rule are presented in Appendix C.
3.6. Costs and Benefits for Reducing Emissions in the Fire Suppression Sector
The proposed rule contains provisions requiring the use of recycled HFCs for initial charge and for
servicing/repairing equipment. Avoiding the consumption and eventual release of these gases through
provisions aimed at maximizing the use of recycled as opposed to virgin HFCs and could result in
significant climate benefits. EPA has provided an analysis of these potential benefits in Appendix D of
this RIA Addendum.
Given EPA previously assumed in the Allocation Framework Rule RIA and 2024 Allocation Rule RIA
Addendum analyses that a significant portion of the HFC market for fire suppression equipment would
transition to lower-GWP alternatives in response to the HFC phasedown, these previously quantified
benefits are excluded from total potential benefits to avoid double counting. In other words, only the
residual market share previously assumed not to transition away from HFCs is used as the basis from
which potential benefits are evaluated. Incremental benefits of the provisions are then analyzed under two
scenarios: 1) a base case which assumes benefits of reducing the use of virgin HFCs in the fire
suppression sector are offset by use of virgin HFCs in sectors not covered by this rule (given the
flexibility of the HFC allowance trading mechanism); and 2) a high additionality case where these
offsetting effects are not assumed. More details on the approach can be found in Appendix D.
3.7. Reporting and Recordkeeping Costs
The proposed regulations associated with recordkeeping and reporting are expected to result in
compliance costs associated with the requirements for recordkeeping and reporting for owners and
operators of fire suppression equipment and of refrigerant-containing appliances that contain HFCs or a
substitute for an HFC with a GWP above 53. Additional recordkeeping and reporting costs are associated
40
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with the requirements to track cylinders by means of a machine-readable tracking identifier, and to
include a certification that reclaimed refrigerant contains no more than 15 percent virgin HFC. All
recordkeeping and reporting costs are calculated by multiplying the estimated burden (hours) times the
average annual respondent hourly cost (labor plus overhead).
In deriving these costs, EPA identified applicable standard occupational classification for each respondent
and used the corresponding 2021 median hourly rate from the Bureau of Labor Statistics (BLS 2022). The
resulting costs outlined in Table 3-9 are the average hourly administrative cost of labor plus overhead for
private firms.
Table 3-9: Labor Rates
Respondent
Bureau of Labor Statistics Information
Total
Standard
Occupational
Classification
Occupational
Title
Median Wage
Technicians
49-9021
Heating, Air-
Conditioning,
and
Refrigeration
Mechanics
and Installers
$26.29
$55.21
Owners/
Operators
17-2111
Health and
Safety
Engineers
$47.93
$100.65
To generate costs, the incremental annual burden (in hours) was estimated for each recordkeeping and
reporting requirement associated with extending the leak repair and inspection requirements to HFC
equipment and multiplied by the hourly wage rate.
Requests for extensions to the leak repair and retrofit timelines. Owners or operators of CC, CR, and
IPR appliances normally containing 15 or more pounds of HFC refrigerant can apply to EPA for an
extension to the leak repair and appliance retrofit timeframe.
41
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The total number of extension requests for CC, CR, and IPR HFC equipment was estimated by scaling the
number of extension requests estimated for ODS equipment in the supporting ICR 1626.1824 based on the
proportion of total HFC equipment to ODS equipment modeled in EPA's Vintaging Model.
Installation records.
Consistent with the ICR, this analysis assumes 1.5 minutes of burden time each time a refrigerant-
containing appliance that contains an HFC or a substitute for an HFC with a GWP greater than 53 is
installed. EPA's Vintaging Model assumptions described in Section 2.3 were used to identify the pool of
affected appliances (i.e., new appliances with charge sizes of an HFC or HFC substitute with a GWP
greater than 53 at or above 15 pounds).
Purchase and service records.
Consistent with the ICR, this analysis assumes 1.5 minutes of burden time each time a refrigerant-
containing appliance that contains an HFC or a substitute for an HFC with a GWP greater than 53 is
serviced.25 EPA's Vintaging Model assumptions described in Section 2.3 were used to identify the pool of
affected appliances (i.e., all HFC or substitute appliances with charge sizes at or above 15 pounds) and the
expected number of times that the affected appliances would be serviced. The total number of servicing
events is assumed to be equal to the number of times that service technicians provide invoices (i.e., one
time per year for all appliances with charge sizes at or above 15 pounds).
Results of verification tests. EPA is proposing leak repair regulations that require initial and follow-up
verification tests on repairs made after the leak rate threshold is exceeded for a refrigerant-containing
appliance that contains an HFC or a substitute for an HFC with a GWP greater than 53. EPA's Vintaging
Model was used to identify the affected pool of appliance (as described in Section 2.3). For every
occurrence of an appliance exceeding the applicable leak rate threshold, 1.5 minutes of burden time was
assumed to maintain reports on the results of verification tests.
Leak inspections. This action proposes that covered CR and IPR appliances with a charge size less than
500 pounds or CC and other appliances with a charge size of at least 15 pounds conduct a leak inspection
once per calendar year until the owner or operator can demonstrate through leak detection calculations
24 ICR 1626.18 was developed to estimate burden associated with reporting and recordkeeping of leak repair and inspection
requirements for appliances containing more than 50 pounds of ODS refrigerant.
25 This assumption is premised on service technicians already needing to record information on services for invoicing, so the only
incremental burden is in saving the data to a record file. For the significant percentage of service companies that record service
information digitally in apps or other software, no time at all is needed to save logged data.
42
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that the appliance has not leaked in excess of the applicable leak rate for one year. CR and IPR appliances
with a charge size from 500 pounds up to 1,500 pounds would be required to conduct a leak inspection
quarterly (i.e., once per three-month period). Appliances, or portions of appliances, continuously
monitored with an ALD system that is certified annually, including appliances with a charge size of 1,500
or more pounds, would not be required to conduct an annual leak inspection. This analysis assumes that
the recordkeeping time associated with maintaining leak inspection records is one minute. EPA's
Vintaging Model was used to identify the affected pool of appliances (as described in described in Section
2.1).
Plans to retrofit appliances. EPA is proposing that owners or operators of IPR, CC, and CR appliances
normally containing 15 or more pounds of a refrigerant containing an HFC or a substitute for an HFC
with a GWP greater than 53 must develop and maintain a plan to retire or retrofit the appliance in the
following cases after the applicable leak rate is exceeded: an owner or operator chooses to retrofit or retire
rather than repair a leak, an owner or operator fails to take action to repair or identify a leak, or an
appliance continues to leak above the applicable leak threshold after a repair attempt was made. The total
number of retrofit requests for CC, CR, and IPR appliances containing 15 or more pounds of a refrigerant
containing an HFC or a substitute for an HFC with a GWP greater than 53 was estimated as 1 percent of
all affected equipment leaking above the threshold (see Table 3-1). For each retrofit plan, 8 hours of
burden time was assumed.
Reports on systems that leak 125 percent or more. EPA is proposing to require owners/operators of
appliances subject to the leak repair and inspection provisions to prepare and submit reports describing
efforts to identify and repair leaks for appliances that leak 125 percent or more of the full charge in a
calendar year. Using the assumptions in the ICR for ODS equipment and scaling proportionately based on
the ratio of affected ODS and HFC appliances, this analysis estimates that approximately 417 appliances
have an annual leak rate greater than 125 percent (i.e., approximately 288 requests for equipment above
50 pounds and approximately 129 requests for equipment containing between 15 and 50 pounds of
refrigerant). For each appliance meeting or exceeding this leak rate threshold, 1 hour of burden time was
assumed to prepare and submit a report for each occurrence.
Requests to cease a retrofit plan. EPA is proposing to require owners/operators of refrigerant-containing
appliances containing 15 or more pounds of an HFC or a substitute for an HFC with a GWP greater than
53 to submit a request to cease a retrofit if certain requirements are met, including an agreement to repair
all identified leaks within one year of the retrofit plan's date. To estimate the costs for this new reporting
43
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requirement, it was assumed that 5 percent of those that develop a retrofit plan will submit a request to
cease their retrofit (i.e., approximately 67 requests for equipment above 50 pounds and approximately 89
requests for equipment containing between 15 and 50 pounds of refrigerant). Each request is assumed to
take 30 minutes to complete.
Annual calibration of ALD system. EPA is proposing to require owners/operators of refrigerant-
containing appliances using ALD systems to maintain records regarding the annual calibration or audit of
the ALD system. Records must be maintained each time an ALD system detects a leak, whether that be
based on the applicable ppm threshold for a direct ALD system, or the indicated loss of refrigerant
measured in the ALD system. EPA assumes indirect ALD systems will collect and store this directly and
no burden is assumed. For owners/operators of direct ALD systems, 1 minute of burden time is assumed.
Cylinder tracking: The total number of cylinder scans required by each respondent (i.e., producer,
importer, reclaimer, filler/packager, fire suppression agent recycler, supplier) was estimated based on
industry input that there are 4.5 million cylinders in circulation in the United States. Producers, importers,
and fillers/packagers were assumed to scan/enter information into the tracking system once in the supply
chain. Reclaimers and fire suppression agent recyclers were assumed to scan/enter information into the
tracking system twice in the supply chain to account for returned cylinders. To account for half of the
cylinders that are returned to the reclaimer or fire suppression agent recycler being distributed through a
supplier, suppliers were assumed to scan/enter information into the tracking system 1.5 times in the
supply chain. Registration with the system was assumed to take half an hour for each respondent, and it
was assumed to take 2 hours per response for producers and importers to enter data into the system, 20
seconds for reclaimers, fillers/packagers, and fire suppression agent recyclers to scan cylinders into the
system, and 10 seconds for suppliers to scan cylinders into the system.
Labeling of reclaimed material with no more than 15% virgin material: It was assumed that
reclaimers already label material and, therefore, will only need to redesign labels to indicate the batch
contains no more than 15% virgin material. The label redesign was assumed to require 9 hours of both
graphic design and administrative work.
3.8. Monetization of Emissions Benefits
The primary benefits of this proposed rule would derive mostly from preventing the emissions of HFCs,
thus reducing the damage from climate change that would have been induced by those emissions. The 18
44
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HFCs and their isomers regulated under the AIM Act are GHGs that can trap much more heat per ton
emitted than CO2, a ratio shown in each chemical's GWP. The ratio of the amount of heat trapped by one
ton of a chemical in the 100 years after it is emitted to the amount of heat trapped by one ton of CO2 in
100 years after being emitted is the chemical's 100-year GWP, and the HFCs regulated under the
phasedown have 100-year GWPs ranging from 53 to 14,80026, with the vast majority of HFCs emitted
having GWPs over 1,000. Prior to HFC regulation under the AIM Act, it was anticipated that HFC use
and emissions would continue to rise, helping to drive global climate change. Thus, reducing the amount
of HFCs that are used and emitted prevents climate damage and associated social costs that would have
been induced by those HFC emissions. A more complete discussion of climate change damages and the
social benefits of preventing them can be found in Sections 4.1 and 4.2 of the Allocation Framework Rule
RIA.
While there may be other benefits to phasing down HFCs, the benefits monetized in this analysis are
limited to the climate benefits of reduced HFC emissions.
3.8.1 Social Cost of HFCs
While CO2 is the most prevalent GHG emitted by humans, it is not the only GHG with climate impacts.
The EPA Endangerment Finding (2009) defined a basket of six gases as the GHG air pollutant addressed
in the finding, comprising CO2, methane (CH4), nitrous oxide (N2O), HFCs, perfluorocarbons (PFCs), and
sulfur hexafluoride (SFe). The climate impact of the emission of a molecule of each of these gases is
generally a function of their lifetime in the atmosphere and the radiative efficiency of that molecule.27 We
estimate the climate benefits for this rulemaking using a measure of the social cost of each HFC
(collectively referred to as SC-HFC) that is affected by the rule. The SC-HFC is the monetary value of the
net harm to society associated with a marginal increase in HFC emissions in a given year, or the benefit of
avoiding that increase. In principle, SC-HFC includes the value of all climate change impacts, including
(but not limited to) changes in net agricultural productivity, human health effects, property damage from
increased flood risk and natural disasters, disruption of energy systems, risk of conflict, environmental
migration, and the value of ecosystem services.28 The SC-HFC, therefore, reflects the societal value of
26 EPA has determined that the exchange values included in subsection (c) of the AIM Act are identical to the 100-
year GWPs included in IPCC (2007). In this context, EPA uses the terms "global warming potential" (or GWP,
measured in units of MMTCChe) and "exchange value" (measured in units of MMTEVe) interchangeably. One
MMTEVe is therefore equivalent to one MMTCChe.
27 In the case of CH4, the climate effect can encompass the atmospheric reactions of the gas that change the abundance of other
substances with climatic effects, such as ozone (O3) and stratospheric water vapor (H2O).
28 Since the SC-HFC estimates are based on the same methodology underlying the SC-GHG estimates presented in the IWG
February 2021 TSD, they share a number of limitations that are common to those SC-GHG estimates. The IAMs used to produce
those interim estimates do not include all of the important physical, ecological, and economic impacts of climate change
recognized in the climate change literature and the science underlying their "damage functions" — i.e., the core parts of the
45
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reducing emissions of the HFC in question by one metric ton. The SC-HFC is the theoretically
appropriate value to use in conducting benefit-cost analyses of policies that affect HFC emissions.
The monetization of climate benefits in this analysis uses the same HFC-specific SC-HFC estimates as
the estimation of the benefits in the Allocation Framework Rule RIA. The SC-HFC values are listed in
2020 dollars per metric ton of HFC emitted by year. The SC-HFC increases over time within the
models—i.e., the societal harm from one metric ton emitted in 2030 is higher than the harm caused by
one metric ton emitted in 2025—because future emissions produce larger incremental damages as
physical and economic systems become more stressed in response to greater climatic change, and because
gross domestic product (GDP) is growing over time and many damage categories are modeled as
proportional to GDP. A more complete discussion of the development of these SC-HFC estimates can be
found in section 4.1 of the Allocation Framework Rule RIA.
EPA has developed a draft updated SC-GHG methodology within a sensitivity analysis in the regulatory
impact analysis of EPA's November 2022 supplemental proposal for oil and natural gas emissions
standards that is currently undergoing external peer review and a public comment process. While that
process continues EPA is continuously reviewing developments in the scientific literature on the SC-
GHG, including more robust methodologies for estimating damages from emissions, and looking for
opportunities to further improve SC-GHG estimation going forward. Most recently, EPA presented a draft
set of updated SC-GHG estimates within a sensitivity analysis in the regulatory impact analysis of EPA's
December 2022 supplemental proposal for oil and gas standards that that aims to incorporate recent
advances in the climate science and economics literature.29 Specifically, the draft updated methodology
incorporates new literature and research consistent with the National Academies near-term
recommendations on socioeconomic and emissions inputs, climate modeling components, discounting
approaches, and treatment of uncertainty, and an enhanced representation of how physical impacts of
climate change translate to economic damages in the modeling framework based on the best and readily
adaptable damage functions available in the peer reviewed literature. EPA solicited public comment on
the sensitivity analysis and the accompanying draft technical report, which explains the methodology
underlying the new set of estimates, in the docket for the proposed oil and natural gas rule. EPA is also
IAMs that map global mean temperature changes and other physical impacts of climate change into economic (both market and
nonmarket) damages — lags behind the most recent research. For example, limitations include the incomplete treatment of
catastrophic and non-catastrophic impacts in the integrated assessment models, their incomplete treatment of adaptation and
technological change, the incomplete way in which inter-regional and intersectoral linkages are modeled, uncertainty in the
extrapolation of damages to high temperatures, and inadequate representation of the relationship between the discount rate and
uncertainty in economic growth over long time horizons. Please see section 4 of the Allocation Framework Rule RIA for a
complete discussion of the limitations associated with the SC-HFC estimates used in this analysis.
29 Standards of Performance for New, Reconstructed, and Modified Sources and Emissions Guidelines for Existing
Sources: Oil and Natural Gas Sector Climate Review (87 FR 74702, December 6, 2022).
46
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completed an external peer review of this technical report. The agency is in the process of reviewing
public comments on the updated estimates within the oil and natural gas rulemaking docket as well as the
recommendations of the external peer reviewers. EPA remains committed to using the best available
science in its analyses. Thus, if EPA's updated SC-GHG methodology is finalized before this rule is
finalized, EPA intends to present monetized climate benefits using the updated SC-GHG methodology in
the final RIA.
3.8.2 SC-HFC and Discount Rates
Climate damages due to emissions of a greenhouse gas accumulate for many years after emission as the
gas remains in the atmosphere trapping heat, and then as the trapped heat continues to cause damages.
Therefore, the SC-HFC value for a particular HFC in a given emission year is highly dependent on the
way the future damages are discounted back to the year of emissions. As explained in Social Cost of
Carbon, Methane, and Nitrous Oxide Interim Estimates under E.O. 13 9 90,30 it is appropriate for agencies
to revert to the same set of four values drawn from the social cost of greenhouse gases (SC-GHG)31
distributions based on three discount rates as were used in regulatory analyses between 2010 and 2016
and subject to public comment (2.5 percent, 3 percent, and 5 percent), plus a fourth value, selected as the
95th percentile of estimates based on a 3 percent discount rate. The fourth value was included to provide
information on potentially higher-than-expected economic impacts from climate change, conditional on
the 3 percent estimate of the discount rate. In that document it was also found that the use of the social
rate of return on capital (7 percent under current OMB Circular A-4 guidance) to discount the future
benefits of reducing GHG emissions inappropriately underestimates the impacts of climate change for the
purposes of estimating the SC-GHG. For purposes of capturing uncertainty around the SC-HFC estimates
in analyses, we emphasize the importance of considering all four values for each HFC affected by the
rule.
3.9. Other Potential Benefits of this Rule
As detailed in Section 3.2.2, the estimated benefits of this proposed rule that are quantified and presented
in this analysis are the benefits of avoiding GHG emissions that would contribute to climate damages.
30 Interagency Working Group on Social Cost of Greenhouse Gases, United States Government (2021), 86 FR
24669, available at https://www.whitehouse.aov/wp-content/uploads/2021/02/TechnicalSupportDocument
SocialCostofCarbonMethaneNitrousOxide.pdf.
31 SC-GHG refers collectively to social costs of different greenhouse gases, e.g., SC-C02, SC-CH4, and SC-HFC. In
each case it is the monetized net social cost of a marginal increase in emissions of the GHG, or the benefit of
avoiding that increase.
47
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There are, however, additional potential benefits that would follow from the provisions proposed but that
are not quantified.
The proposed provisions that would require leak inspections, the repair of leaks, and/or the installation of
ALD systems for certain appliances are best practices for the maintenance and upkeep of RACHP
appliances. As described in Section Error! Reference source not found., following such best practices
accrues benefits for the owner/operator of the appliance by reducing the loss of refrigerant, resulting in
savings. A regular practice of inspecting equipment and repairing leaks when detected (rather than
topping-up the appliance) also prevents equipment from breaking down as often and can prolong the
effective service life of appliances.32 Fewer repairs of broken appliances and extending their service life
directly benefits owner/operators, and in the case of refrigeration equipment reducing equipment failures
has the additional benefit of reducing the loss of refrigerated stock.33 The costs of a refrigeration
appliance at a retail store failing and thousands of pounds of perishable stock being lost are considerable,
and the aggregate costs of such food waste to the U.S. economy are also significant. In 2021,
approximately 344,000 MT of food were lost due to equipment issues in the retail and food service
sectors, with a value of $1.87 billion.34
The provisions of this rule designed to maximize reclaim would provide a number of additional benefits
that are not quantified. As the HFC phasedown progresses, the supply of virgin HFCs will be reduced, but
the demand for refrigerants, fire suppression agents, aerosol propellants, etc. will continue to grow. Many
uses of HFCs will transition to using substitutes, but it is expected that some demand for HFCs will
continue based on the agency's experience with the ODS phaseout. For example, although halons have
not been produced or imported into the United States for decades, recycled halons are still used for the
initial charging and servicing of certain fire suppression equipment. Reclaimed and recycled HFCs will be
needed to meet the continuing demand and to meet certain requirements in the proposed Rule.
By avoiding supply shortages of HFCs that are still needed for servicing certain appliances, maximizing
reclaim avoids the economic disruption that might occur, including the stranding of equipment. A robust
supply of reclaimed refrigerant would also protect the cold chain needed to deliver food and vaccines.
Maximizing reclaim would also benefit sectors not directly covered by provisions of this rule due to the
interdependency of the HFC supply markets through the HFC allocation system. Certain specialized uses
that cannot use reclaimed HFCs are expected to continue to require virgin HFCs, for example MDIs for
32 Crippa, 2021; Barnish, 1997
33 Brush, 2011
34 ReFED Insights Engine 2020
48
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the treatment of asthma and COPD. Increased use of reclaimed HFCs in refrigeration and other sectors
will free up virgin HFCs for uses such as MDIs.
3.10. Costs and Benefits under a Marginal Abatement Cost Methodology
Appendix K analyzes certain provisions of the proposed Rule using a Marginal Abatement Cost (MAC)
approach. The methodology to construct a MAC Curve and how it can be used to evaluate the potential
costs from a list of abatement options to meet regulatory requirements are discussed in the Allocation
Framework Rule RIA. The approach offers a modified perspective of the costs and benefits of the
proposed Rule.
4. Economic Impact Analysis of Leak Repair and Inspection
provisions
This section summarizes the estimated impacts associated with the Agency's proposed leak repair and
inspection regulations under subsection (h). These results were generated for the equipment types
characterized in Section 2, using the methodology described in Section 3. All costs and savings are
provided in 2022 dollars and based on current appliance distributions.
To provide a full range of costs, savings, and benefits estimates, Appendix F presents analysis of an
alternative policy option considering a 5 pound-equipment threshold and the associated costs, savings,
and benefits for equipment between 5 and 50 pounds in 2025 and 2035. In addition, Appendix H presents
an analysis on the potential economic impacts to small businesses and governments.
4.1. Annual Leak Repair Compliance Costs
In 2025, EPA's proposed regulations are expected to result in compliance cost for each equipment sector
and type category as shown in Table 4-1.
Table 4-1: Aggregate Compliance Costs by Sector, Equipment Type, and Sizea
Sector
¦y
—i
l.(|ui|)nu'iil
Tj pi1
ipmcMil
2(125
21130
21140
2050
CC
School &
Tour Bus AC
Sub-small
$8,117,200
$8,906,500
$10,134,400
$10,979,000
Transit Bus
AC
Sub-small
$2,871,100
$3,150,300
$3,584,600
$3,883,400
49
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Passenger
Train AC
Sub-small
$437,900
$484,200
$530,700
$574,700
Chiller
Medium
$12,447,500
$15,028,900
$16,333,100
$17,690,200
Large
$86,800
$95,400
$111,200
$124,100
CR
Modern Rail
Transport
Sub-small
$728,700
$747,100
$799,500
$865,900
Vintage Rail
Transport
Sub-small
$722,700
$274,500
$0
$0
Condensing
Unit
Sub-small
$24,522,400
$26,608,200
$27,242,400
$30,055,100
Marine
Transport
Small
$1,460,400
$1,882,400
$2,395,600
$2,702,700
Medium
$7,871,000
$9,877,500
$12,527,000
$14,108,200
Large
$508,900
$400,500
$467,000
$507,500
Rack
Medium
$67,315,500
$47,774,500
$52,713,100
$57,283,800
Large
$63,506,400
$45,367,700
$50,016,800
$54,337,800
Cold Storage
Large
$2,208,200
$488,700
$210,900
$0
IPR
IPR
Medium
$1,252,400
$1,031,500
$461,200
$0
Large
$71,241,900
$14,563,300
$6,741,700
$0
Reporting and Recordkeeping
$11,787,800
$13,341,400
$14,509,400
$15,761,100
a Costs are displayed using a 3 percent discount rate.
EPA's proposed leak inspection, leak repair, ALD, recordkeeping, and reporting regulations are expected
to result in total incremental present value (PV) compliance costs (net of refrigerant savings) of
approximately $3.6 billion based on a 3% discount rate, discounted back to 2024, as shown in Table
4-2. EPA also presents the equivalent annualized value (EAV), which represents a flow of constant
annual values that, had they occurred in each year from 2024 to 2050, would yield a sum equivalent to the
present value (PV).
Table 4-2. Incremental Annual Compliance Costs, Including Refrigerant Savings
(2022$)
Year
Total
Incremental
Compliance Costs
(3% Discount
Rate)
Refrigerant
Savings
Total Incremental Compliance Costs Minus Refrigerant
Savings
(3% Discount Rate)
2025
$278,400,000
$13,100,000
$265,300,000
2026
$219,100,000
$13,400,000
$205,700,000
2027
$229,900,000
$13,600,000
$216,300,000
2028
$242,700,000
$13,700,000
$229,000,000
2029
$250,000,000
$13,900,000
$236,100,000
2030
$190,600,000
$13,900,000
$176,700,000
2031
$191,900,000
$14,000,000
$177,900,000
2032
$192,700,000
$14,000,000
$178,700,000
2033
$193,600,000
$14,000,000
$179,600,000
2034
$194,300,000
$13,900,000
$180,400,000
2035
$194,500,000
$13,700,000
$180,800,000
2036
$194,600,000
$13,400,000
$181,200,000
2037
$195,200,000
$13,100,000
$182,100,000
50
-------
2038
$195,700,000
$12,800,000
$182,900,000
2039
$196,100,000
$12,500,000
$183,600,000
2040
$196,500,000
$12,200,000
$184,300,000
2041
$196,800,000
$11,900,000
$184,900,000
2042
$197,100,000
$11,600,000
$185,500,000
2043
$197,300,000
$11,200,000
$186,100,000
2044
$197,500,000
$10,900,000
$186,600,000
2045
$197,800,000
$10,600,000
$187,200,000
2046
$198,400,000
$10,300,000
$188,100,000
2047
$199,200,000
$10,200,000
$189,000,000
2048
$200,300,000
$10,100,000
$190,200,000
2049
$201,600,000
$10,100,000
$191,500,000
2050
$203,300,000
$10,200,000
$193,100,000
Discount Rate
3%
7%
NPV
$3,395,000,000
$2,203,000,000
EAV
$196,000,000
$199,000,000
4.2. Refrigerant Costs and Savings in 2025 by Rule Component
Total annual savings associated with reduced refrigerant use are estimated to be $13 million. Table 4-3
below shows the annual savings by rule component. As noted in Section Error! Reference source not
found., the leak repair requirement is expected to result in refrigerant savings for system owners or
operators due to earlier leak repair action.
Table 4-3. Total Annual Refrigerant Savings in 2025 (2022$) and Combined Annual Cost and
Annual Savings with 7% and 3% Discount Rate
Rule Component
Annual
Increment
Combined
Incremental
Combined
Refrigerant
Savings
al
Complianc
e Costs
Annual Savings
and Compliance
Costs
Compliance
Costs
Annual Savings
and
Compliance
Costs
7% Discount Rate
3% Discount Rate
Leak Repair
CC (Sub-small, 15-50 lbs.)
-$36,100
$3,054,000
$3,018,000
$1,450,000
$1,414,000
CC (Small, 51-199 lbs.)
$0
$0
$0
$0
$0
CC (Medium, 200-1,999
-$3,184,000
$8,798,000
$5,614,000
$4,210,000
$1,026,000
lbs.)
CC (Large, >2,000 lbs.)
-$120,900
$139,000
$18,000
$66,000
-$55,000
CR (Sub-small, 15-50 lbs.)
-$198,400
$3,748,000
$3,549,000
$1,780,000
$1,582,000
CR (Small, 51-199 lbs.)
-$183,500
$244,000
$60,000
$116,000
-$68,000
CR (Medium, 200-1,999
-$1,945,200
$1,894,000
-$51,000
$905,000
-$1,041,000
lbs.)
CR (Large, >2,000 lbs.)
-$1,348,900
$549,000
-$800,000
$259,000
-$1,090,000
LPR (Medium, 200-1,999
-$192,200
$137,000
-$55,000
$66,000
-$126,000
lbs.)
LPR (Large, >2,000 lbs.)
-$5,925,600
$734,000
-$5,192,000
$348,000
-$5,577,000
Leak Inspection
51
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CC (Sub-small, 15-50 lbs.)
$0
$10,012,00
0
$10,012,000
$10,012,000
$10,012,000
CC (Small, 51-199 lbs.)
$0
$0
$0
$0
$0
CC (Medium, 200-1,999
lbs.)
$0
$11,422,00
0
$11,422,000
$11,422,000
$11,422,000
CC (Large, >2,000 lbs.)
$0
$141,000
$141,000
$141,000
$141,000
CR (Sub-small, 15-50 lbs.)
$0
$24,392,00
0
$24,392,000
$24,392,000
$24,392,000
CR (Small, 51-199 lbs.)
$0
$1,528,000
$1,528,000
$1,528,000
$1,528,000
CR (Medium, 200-1,999
lbs.)
$0
$11,906,00
0
$11,906,000
$11,906,000
$11,906,000
CR (Large, >2,000 lbs.)
$0
$884,000
$884,000
$884,000
$884,000
IPR (Medium, 200-1,999
lbs.)
$0
$1,379,000
$1,379,000
$1,379,000
$1,379,000
IPR (Large, >2,000 lbs.)
$0
$993,000
$993,000
$993,000
$993,000
Automatic Leak Detection
CC
$0
$0
$0
$0
$0
CR
$0
$130,751,0
00
$130,751,000
$130,751,000
$130,751,000
IPR
$0
$75,826,00
0
$75,826,000
$75,826,000
$75,826,000
Reporting & Recordkeeping
CC and CR (15-50 lbs.)
$0
$6,328,000
$6,328,000
$6,328,000
$6,328,000
CC, CR, and IPR (>50 lbs.)
$0
$5,459,000
$5,459,000
$5,459,000
$5,459,000
Total
-$13,134,800
$300,320,0
00
$287,180,000
$290,220,000
$277,090,000
Totals may not sum due to independent rounding.
More detailed results for reporting and recordkeeping are shown in Table 4-4 below.
Table 4-4. 2025 Incremental Compliance Costs for Recordkeeping and Reporting for Leak
Inspection and Leak Repair (2022$)
Recordkeeping & Reporting Rule Component
Direct Compliance Costs
CC and CR
(15-50 pounds)
CC, CR, and
IPR (>50
pounds)
Total
Recordkeeping associated with leak inspection and repair
Owners/operators of appliances w/charge sizes >15
lbs maintain installation records.
$129,000
$284,000
$413,000
Persons ser\>icing appliances w/charge sizes >15 lbs
provide invoices to appliance owners/operators.
$1,407,000
$1,173,000
$2,580,000
Owners/operators of appliances w/charge sizes >15
lbs maintain purchase and sen'ice records.
$1,924,000
$1,604,000
$3,528,000
Persons ser\>icing appliances w/charge sizes >15 lbs
provide leak inspection records
$185,000
$132,000
$317,000
Owners/operators of appliances w/charge sizes >15
lbs maintain leak inspection records
$337,000
$551,000
$888,000
Owners/operators of appliances w/charge sizes >15
lbs prepare & submit requests for extensions to 30-
dav repair timeline
$7,000
$7,000
$14,000
52
-------
Owners/operators of appliances w/charge sizes >15
lbs prepare & submit requests for extensions to 1-
vear retrofit/repair timeline
$1,000
$1,000
$2,000
Owners/operators of appliances w/charge sizes >15
lbs - Develop/Maintain plan to retire/replace or
retrofit equipment, as applicable
$1,619,000
$1,154,000
$2,773,000
Owners/operators of HFC appliances to submit
requests to cease retrofit/retirement if all leaks are
repaired
$5,000
$4,000
$9,000
Owners/operators of appliances w/charge sizes >15
lbs maintain records on mothballed equipment
<$200
<$100
<$200
Persons servicing appliances w/charge sizes >15
lbs provide reports on the results of verification
tests
$185,000
$132,000
$317,000
Owners/operators of appliances w/charge sizes >15
lbs - Maintain reports on the results of verification
tests
$506,000
$360,000
$866,000
Owners/operators of appliances w/charge sizes >15
lbs prepare and submit a report to EPA if excluding
purged refrigerants that are destroyed from annual
leak rate calculations for the first time
<$100
<$100
<$100
Owners/operators of appliances w/charge sizes >15
lbs maintain information on purged/destroyed
refrigerant
<$100
<$100
<$100
Owners/operators of appliances submit report to
EPA and describe efforts to identify and repair
systems that leak 125% or more of the full charge in
a 365 dav period
$21,000
$15,000
$36,000
Owners/operators maintain records of anything that
is reported to EPA.
$1,000
$1,000
$2,000
Owners/operators of direct ALD systems maintain
records regarding the annual calibration or audit of
the system and any time the ALD system detects a
leaka
$0
$41,000
$41,000
Total
$6,328,000
$5,459,000
$11,790,000
Totals may not sum due to independent rounding.
a The use of direct ALD monitoring is assumed to provide owners/operators with the information needed to satisfy this
requirement (i.e., no burden is assumed for those systems assumed to install direct ALD systems).
4.3. Leak Repair and Inspection Emission Reduction Benefits
The Agency's proposed leak repair requirements for refrigerant-containing appliances that contain HFCs
or a substitute for HFCs with a GWP greater than 53 are expected to reduce GHG emissions. Annual
GHG emissions avoided from the proposed regulations are expected to be approximately 3.8 MMTCCheq
in 2025 to 1.9 MMTCC^eq in 2050. Error! Reference source not found, below shows the GHG
emissions avoided from HFC refrigerants by rule component for selected years.
Table 4-5. Annual GHG Emissions Avoided in 2025, 2030, 2040, and 2050
Rule Component
GHG Emissions Avoided (MTCCheq)
Leak Repair
2025
2030
2040
2050
CC (Sub-small, 15-50 lbs.)
5,900
6,500
7,300
8,000
53
-------
CC (Small, 51-199 lbs.)
-
-
-
-
CC (Medium, 200-1,999 lbs.)
513,000
480,000
219,000
132,000
CC (Large, >2,000 lbs.)
17,900
15,800
12,200
9,300
CR (Sub-small, 15-50 lbs.)
65,000
59,600
45,700
50,400
CR (Small, 51-199 lbs.)
74,700
97,000
124,000
140,000
CR (Medium, 200-1,999 lbs.)
690,000
803,000
970,000
1,080,000
CR (Large, >2,000 lbs.)
551,000
527,000
470,000
443,000
IPR (Medium, 200-1,999 lbs.)
36,000
29,900
13,400
-
IPR (Large, >2,000 lbs.)
1,850,000
1,770,000
922,000
Total
3,800,000
3,790,000
2,780,000
1,860,000
Totals may not sum due to independent rounding.
4.4. Leak Repair and Inspection Emission Reduction Benefits in Later Years
The distribution of refrigerant-containing appliances that contain HFCs or a substitute for HFCs with a
GWP greater than 53 in use is anticipated to change significantly over the next decades, resulting in
different leak repair and inspection benefits for later years. Table 4-6Error! Reference source not
found, below shows the annual GHG emissions avoided from HFC refrigerants. Note that the GWP-
weighted emissions avoided in 2050 are less than half that in 2025 not because of decreased efficacy of
leak repair or a decrease in use of refrigerant, but because the average GWP of the refrigerant that would
leak gets lower over time.
Table 4-6. Annual GHG Emissions Avoided in Select Years
Year
HFC Emissions Avoided
(MTCCfce)
2025
3,800,000
2029
3,810,000
2034
3,640,000
2036
3,370,000
2045
2,060,000
2050
1,860,000
Total 2025-2050
77,800,000
4.5. Estimated Climate Benefits of Leak Repair
Table 4-7. Monetized Climate Benefits (2022$)
Year
Emissions Avoided
(MTCChe)
Monetized Climate Benefits
(3% Discount Rate SC-HFC)
2025
3,800,000
$293,500,000
2026
3,810,000
$302,600,000
2027
3,820,000
$311,200,000
2028
3,820,000
$319,300,000
2029
3,810,000
$326,600,000
2030
3,790,000
$332,900,000
54
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2031
3,780,000
$340,000,000
2032
3,750,000
$345,700,000
2033
3,720,000
$351,800,000
2034
3,640,000
$352,800,000
2035
3,510,000
$347,700,000
2036
3,370,000
$342,200,000
2037
3,230,000
$335,800,000
2038
3,080,000
$328,300,000
2039
2,930,000
$319,800,000
2040
2,780,000
$310,100,000
2041
2,630,000
$299,400,000
2042
2,480,000
$288,300,000
2043
2,330,000
$276,700,000
2044
2,180,000
$264,700,000
2045
2,060,000
$255,600,000
2046
1,970,000
$249,100,000
2047
1,900,000
$245,500,000
2048
1,860,000
$245,000,000
2049
1,850,000
$248,100,000
2050
1,860,000
$255,100,000
Discount Rate
3%
NPV
$5,359,000,000
EAV
$291,000,000
4.6. Comparison of Net Benefits for Alternative Leak Repair and Automatic Leak
Detection Scenarios
This rule proposes to require appliances with 15 pounds or greater charge size to repair leaks above the
leak rate threshold and proposes that all CR and IPR equipment with charge sizes of 1,500 pounds or
more of refrigerant be equipped with ALD systems. Charge sizes other than 15 pounds were considered
for the leak repair threshold, and a comparison of the net benefits (climate benefits minus compliance
costs) in select years for different scenarios are shown in Table 4-8Table 4-8Table 5-1. All of the
scenarios in the table assume the charge size threshold for requiring ALD systems is 1,500 lb. More
detailed information on the benefits and costs of alternative threshold scenarios can be found in Appendix
F.
The incremental effect of lowering the leak repair threshold from 50 lbs. or greater to 30 lbs. or greater
decreases the PV of net benefits by $465 million at a 3% discount rate ($258 million at a 7% discount
rate). This results because, in the charge size range from 30 lbs to 50 lbs, the compliance costs (net of
annual refrigerant savings) exceed the climate benefits. The incremental effect of lowering the leak repair
threshold from 30 lbs. or greater to 15 lbs. or greater decreases the PV of net benefits by $269 million at a
3% discount rate ($162 million at 7% discount rate).
55
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Table 4-8. Comparison of Net Benefits for Alternative Leak Repair Thresholds. (Millions 2022$)
Year
5 lb Leak Repair
30 lb Leak Repair
50 lb Leak Repair
Emissions
Avoided
(MMTCO
2e)
Net Benefits
(3% Discount
Rate SC-HFC)
Emissions
Avoided
(MMTCChe)
Net Benefits
(3%
Discount
Rate SC-
HFC)
Emissions
Avoided
(MMTCChe
)
Net
Benefits
(3%
Discount
Rate SC-
HFC)
2025
4.2
-$383
3.8
$30
3.7
$55
2029
4.2
-$346
3.8
$92
3.7
$118
2034
4.0
-$289
3.6
$174
3.6
$200
2036
3.7
-$313
3.4
$163
3.3
$189
2045
2.4
-$454
2.1
$70
2.0
$98
2050
2.2
-$478
1.9
$64
1.8
$92
Total
86
78
76
Costs d.r.
3%
7%
3%
7%
3%
7%
NPV
(2025-
2050)
-$6,243
-$1,734
$1,992
$3,168
$2,457
$3,426
EAV
-$339
-$284
$108
$118
$133
$141
Totals may not sum due to independent rounding.
EPA also considered various charge size thresholds for the proposed provision requiring the use of ALD
equipment. The net benefits of scenarios with ALD required at 500 lb., 1,000 lb., and 2,000 lb. are shown
in Table 4-9. All scenarios in the table assume a leak repair charge size threshold of 15 pounds.
The incremental effect of upping the ALD threshold from 1500 lbs or greater to 2000 lbs or greater
increases the PV of net benefits by $629 million at a 3 percent discount rate ($337 million at a 7 percent
discount rate). The incremental effect of lowering the ALD threshold from 1500 lbs to 1000 lbs decreases
the PV of net benefits by $64 million at a 3 percent discount rate ($47 million at a 7 percent discount
rate). The incremental effect of lowering the ALD threshold from 1000 lbs to 500 lbs decreases the PV of
net benefits by $430 million at a 3 percent discount rate ($100 million at 7 percent discount rate).
Table 4-9. Comparison of Net Benefits for Alternative ALD Thresholds (Millions of2022$)
Year
500 lb
1,000 lb ALD
2,000 lb ALD
Emissions
Avoided
(MMTCOze)
Net Benefits
(3%
Discount
Rate SC-
HFC)
Emissions
Avoided
(MMTCOze)
Net Benefits
(3% Discount
Rate SC-
HFC)
Emissions
Avoided
(MMTCOze)
Net Benefits
(3% Discount
Rate SC-
HFC)
56
-------
2025
4.0
-$50
3.8
-$1
3.7
$70
2029
4.1
$20
3.8
$67
3.7
$126
2034
3.9
$135
3.7
$157
3.5
$192
2036
3.7
$125
3.4
$146
3.3
$180
2045
2.4
$39
2.1
$53
2.0
$86
2050
2.2
$36
1.9
$46
1.7
$79
Total
85
78
75
Costs d.r.
3%
7%
3%
7%
3%
7%
NPV
(2025-
2050)
$1,228
$2,859
$1,659
$2,958
$2,352
$3,342
EAV
$67
$81
$90
$101
$128
$136
Totals may not sum due to independent rounding.
5. Comparison of Costs and Benefits for the Proposed Rule
5.1. Comparison of Costs and Benefits of Leak Repair and Inspection Provisions
As shown in Table 5-1, it is estimated that the economic benefits of avoiding millions of tons of potent
GHGs would far outweigh the costs of complying with the proposed Leak Repair and ALD provisions of
this rule. Over the period 2025-2050, the equivalent annual benefits associated with reduced climate
damages are approximately $291 million (3 percent discount rate), while the estimated EAV of
compliance costs is $186M (7 percent) to $197M (3 percent). Thus, it is estimated that this rule as
proposed would generate net benefits with a present value of $ 1.7B to $3 .OB from 2025-2050, equivalent
to annual net benefits of $94M to $105M.
Table 5-1. Monetized Climate Benefits, Costs, and Net Benefits for Leak-related Provisions
Year
Climate Benefits
Cost
Net Benefits
2025
$293,500,000
$265,300,000
$28,200,000
2026
$302,600,000
$205,800,000
$96,800,000
2027
$311,200,000
$216,300,000
$94,900,000
2028
$319,300,000
$228,900,000
$90,400,000
2029
$326,600,000
$236,100,000
$90,500,000
2030
$332,900,000
$176,700,000
$156,200,000
57
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2031
$340,000,000
$177,900,000
$162,100,000
2032
$345,700,000
$178,700,000
$167,000,000
2033
$351,800,000
$179,600,000
$172,200,000
2034
$352,800,000
$180,400,000
$172,400,000
2035
$347,700,000
$180,800,000
$166,900,000
2036
$342,200,000
$181,200,000
$161,000,000
2037
$335,800,000
$182,100,000
$153,700,000
2038
$328,300,000
$182,800,000
$145,500,000
2039
$319,800,000
$183,600,000
$136,200,000
2040
$310,100,000
$184,300,000
$125,800,000
2041
$299,400,000
$184,900,000
$114,500,000
2042
$288,300,000
$185,500,000
$102,800,000
2043
$276,700,000
$186,100,000
$90,600,000
2044
$264,700,000
$186,600,000
$78,100,000
2045
$255,600,000
$187,300,000
$68,300,000
2046
$249,100,000
$188,100,000
$61,000,000
2047
$245,500,000
$189,000,000
$56,500,000
2048
$245,000,000
$190,200,000
$54,800,000
2049
$248,100,000
$191,500,000
$56,600,000
2050
$255,100,000
$193,100,000
$62,000,000
DR
3%
3%
7%
3%
7%
PV
$5,359,000,000
$3,395,000,000
$2,203,000,000
$1,964,000,000
$3,156,000,000
EAV
$291,000,000
$196,000,000
$199,000,000
$95,000,000
$92,000,000
Totals may not sum due to independent rounding.
5.2 Comparison of Costs and Benefits of Required Use of Reclaimed HFCs
The use of some recycled/reclaimed HFCs was already anticipated as a path to compliance with the HFC
phasedown consumption caps in the analysis of the Allocation Framework rule and 2024 Allocation Rule
RIA Addendum, but the specific provisions of this proposed rule would increase the use of
recycled/reclaimed HFCs beyond what was already accounted for in that RIA.
Because the cost savings estimated in Appendix B using the methods in Yasaka et al. are based on the life
cycle differences between the use of reclaimed refrigerant and using virgin refrigerant, under the base
case scenario where the allocations not used by the subsectors required to use reclaimed refrigerant are
instead transferred and used by others, no incremental benefits are estimated. Under the high-additionality
case, the required use of reclaim is estimated to generate incremental climate benefits of $267 M from
2028 through 2050, discounted to 2024 at 3 percent. The estimated net benefits of the provisions
requiring use of reclaimed refrigerant are $251 M discounting costs at 3 percent and $256 M discounting
costs at 7 percent. Details of monetized climate benefits, compliance costs, and net benefits are provided
in Table 5-2.
58
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Table 5-2. Monetized Climate Benefits, Costs, and Net Benefits for Required Use of Reclaim
(millions of2022$)
Year
Climate Benefits
Cost
Net Benefits
2025
$0
$0
$0
2029
$9.9
$1.0
$8.9
2034
$21.8
$1.1
$20.7
2036
$22.0
$1.1
$20.9
2045
$19.9
$0.9
$19.0
2050
$15.0
$0.9
$14.1
DR
3%
3%
7%
3%
7%
PV
$267
$16
$11
$251
$256
EAV
$14
$1
$1
$14
$14
Totals may not sum due to independent rounding.
5.3 Comparison of Costs and Benefits of Requirements on HFC Cylinders
As detailed in Appendix C, the proposed provisions requiring management and tracking of cylinders of
refrigerants and fire suppressants would entail compliance costs and climate benefits. Under both the base
case and high additionality case, it is estimated that the provisions of this proposed rule would generate
additional net benefits of approximately $4.5 billion over the period 2025 through 2050, discounted to
2024.
5.4 Comparison of Costs and Benefits of Fire Suppression Sector Provisions
As detailed in Appendix D, the provisions for the fire suppression sector proposed in this rule are not
estimated to have any incremental benefits under the Base Case. In the High-additionality case, we
estimate the provisions would yield an average of 0.96 MMTCC^e annually in avoided HFC
consumption. When converted to corresponding emissions reductions over equipment lifetime and
monetized using the social cost of HFCs, the present value of cumulative climate benefits over the 2025-
2050 period is estimated to be $342 million in the high additionality case. These potential benefits, along
with estimated costs from recordkeeping and reporting provisions, are shown in Table 5-3 below.
59
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Table 5-3. Monetized Climate Benefits, Costs, and Net Benefits for Fire Suppression Sector
Provisions Under High Additionality Scenario (millions of2022$)
Year
Climate Benefits
Cost
Net Benefits
2025
$19.0
$0.3
$18.7
2029
$20.1
$0.3
$19.7
2034
$21.9
$0.3
$21.6
2036
$22.0
$0.3
$21.7
2045
$19.9
$0.3
$19.6
2050
$15.0
$0.3
$14.7
DR
3%
3%
7%
3%
7%
PV
$342
$5.0
$3.2
$337
$338
EAV
$19
$0.3
$0.3
$18
$18
Totals may not sum due to independent rounding.
5.5 Comparison of Costs and Benefits of RCRA Amendments
As described in Section 3.4, the amendments to RCRA standards for reclaimers are anticipated to be cost
neutral or to provide some savings from reduced compliance burden on these entities. As documented in
the ICR in the docket for this rulemaking, the aggregate annual reduction in compliance burden of
approximately $91,000. Taking this value as the net benefit of the amendments for each year 2025
through 2050 and discounting the savings to 2024, the present value of the savings benefits would be $1.0
million (7 percent discount rate) to $ 1.6 million (3 percent). This would be equivalent to $0.1 M annually
2025-2050. Because these benefits are not related to HFC consumption that was already accounted for
under the Allocation Framework rule, the net benefits would be the same under the base case and the high
additionality case. Because these estimates are heavily dependent on the future market for ignitable spent
refrigerant sent for reclamation, which is difficult to predict with currently available data, the net benefits
may be lower and are shown as a range from $0 to the discounted values above. These net benefits are not
added to the overall incremental benefits of the proposed rule in Table 5-5Error! Reference source not
found..
5.6 Recordkeeping and Reporting Costs
The subsection (h) rule contains several provisions that EPA has estimated will result in additional
recordkeeping and reporting cost burden for affected industries.
EPA has prepared an information collection request (ICR), ICRNumber 2778.01, and a Supporting
Statement which can be found in the docket. The information collection requirements for recordkeeping,
reporting, and labeling are not enforceable until OMB approves them. Among other things, EPA
calculated the estimated time and financial burden over a three-year period (ICRs generally cover three-
60
-------
year time periods) for respondents to implement labeling practices and to electronically report data to the
Agency on an annual basis. A key summary of the respondent burden estimates follows, and the full
methodology for these calculations can be found in the docket.
Recordkeeping and reporting costs associated with the rule's proposed leak repair and inspection
requirements, fire suppression equipment requirements, cylinder tracking requirements, and reclamation
requirements are summarized in table 24 below. Based on these estimates, the present value (discounted
to 2024) of total recordkeeping and reporting costs across all proposed rule provisions is approximately
$307 million, using a 3% discount rate, or $199 million, using a 7% discount rate.
Table 5-4: Estimated Recordkeeping and Reporting Costs by Rule Provision (millions
2022$)
Year
Leak Inspection and
Repair
Fire Suppression
Cylinder Tracking
Reclamation
2025
$11.79
$0.05
$1.05
$0.01
2030
$13.34
$0.05
$3.25
$0.06
2035
$13.86
$0.05
$3.25
$0.06
2040
$14.51
$0.05
$3.25
$0.06
2045
$15.14
$0.05
$3.25
$0.06
2050
$15.76
$0.05
$3.25
$0.06
DR
3%
7%
3%
7%
3%
7%
3%
7%
PV
$241.44
$150.62
$0.82
$0.52
$54.54
$34.17
$0.99
$0.62
EAV
$13.91
$13.63
$0.05
$0.05
$3.14
$3.09
$0.06
$0.06
5.7 Comparison of Costs and Benefits of the Proposed Rule
The present value of the net benefits of this proposed rule are equal to the sum of the net costs or benefits
of the various provisions in each year 2025-2050, discounted to 2024. The proposed provisions which
contribute to the total net benefits are those covering leak inspections, leak repair, recordkeeping and
reporting, reduced emissions and use of recycled HFCs in fire suppression equipment management and
ultimate evacuation of disposable cylinders and tracking provisions for disposable and refillable
cylinders, and the required use of reclaimed HFCs in the initial charging and service of certain appliances.
The use of recycled/reclaimed HFCs was already anticipated as a path to compliance with the HFC
phasedown consumption caps in the analysis of the Allocation Framework rule, but the specific
provisions of this proposed rule would likely increase the use of recycled/reclaimed HFCs beyond what
61
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was already accounted for in that RIA. To the extent this additional use of recycled/reclaimed HFCs
displaces consumption of virgin HFCs either a) the reduced consumption of virgin HFCs in one sector
would free up allocation allowances that would then be used elsewhere for consumption of HFCs, or b)
the reduction in the consumption of virgin HFCs would result in incremental climate benefits under this
proposed rule. The former scenario is presented as part of the base case and the latter as part of the high
additionality case for the net benefits in Table 5-5.
Table 5-5: Present Value and Equivalent Annual Value of the Net Benefits or Costs of Rule
Provisions 2025-2050a-b
Base Case Net Benefits
2025-2050 (millions 2022$)
High Additionality Case Net Benefits
2025-2050 (millions 2022$)
Rule Provisions
Costs
Discount Rate
3%
7%
3%
7%
Leak Repair, Leak
Inspection^ ALD
NPV
$1,964
$3,156
$1,964
$3,156
EAV
$113
$109
$113
$109
Fire Suppression
NPV
$0
$0
$337
$338
EAV
$0
$0
$18
$18
Cylinder
Management
NPV
$4,453
$4,457
$4,453
$4,457
EAV
$257
$256
$257
$256
Required Use of
Reclaim
NPV
$0
$0
$251
$256
EAV
$0
$0
$14
$14
Recordkeeping and
Reporting
NPV
($298)
($186)
($298)
($186)
EAV
($17)
($17)
($17)
($17)
Total (AIM Act)
NPV
$6,120
$7,427
$6,708
$8,021
EAV
$353
$349
$385
$381
RCRA Amendments
NPV
$0-$1.6
$0-$1.0
$0-$1.6
$0-$1.0
EAV
$0-$0.1
$0-$0.1
$0-$0.1
$0-$0.1
Total (AIM +
RCRA)
NPV
$6,120-$6,122
$7,427-$7,428
$6,708-$6,710
$8,021-$8,022
EAV
$353-$353
$349-$349
$385-$385
$381-$381
a. Net costs are shown in parentheses.
b. Totals may not sum due to independent rounding.
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6 Environmental Justice
6.1 Introduction and Background
The environmental justice analyses that were conducted as part of the Allocation Framework Rule RIA
and subsequent 2024 Allocation Framework Rule and proposed Technology Transitions Rule RIA
addenda addressed issues associated with the impacts of changes in the production of HFCs and certain
substitutes of HFCs on communities near facilities identified as producers of these chemicals. EPA could
not identify specific effects of the HFC phasedown or transitions on individual communities, but the
Agency did identify ten specific facilities with emissions likely to be affected by these rules. EPA
analyzed the demographic characteristics of the fence-line communities in the Census Block Groups
within 1-, 3-, 5-, and 10-mile radii of the affected facilities. Please refer to Chapter 6 of the Allocation
Framework Rule RIA for an extensive discussion of the environmental justice implications of HFC
production and transition.
This chapter provides an analysis of the environmental justice (EJ) implications of this proposed rule
under Subsection (h) of the AIM Act. The information provided in this section of this document is for
informational purposes only; EPA is not relying on the information in this section as a record basis for the
proposed action. This analysis is largely similar in approach to that used in the previous EJ analyses, in
that it focuses on the baseline environmental conditions in communities proximate to known HFC
reclamation facilities which EPA expects may be affected by the proposed Rule.
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As discussed in the preamble to this rule, the Subsection (h) Rule proposes to: establish a program for the
management of hydrofluorocarbons that includes requirements for leak repair and use of automatic leak
detectors for certain equipment containing HFC refrigerants; require use of reclaimed HFCs in certain
sectors or subsectors; establish management, labeling and tracking standards for disposable and refillable
cylinders; mandate certain recordkeeping and reporting requirements; and require certain other elements
related to the effective implementation of the Act. EPA is also proposing alternative Resource
Conservation and Recovery Act (RCRA) standards for ignitable, spent refrigerants being recycled for
reuse. The new standards would require that ignitable, spent refrigerant being recycled for reuse be sent to
EPA-certified reclamation facilities.
6.2 Environmental Justice at EPA
Executive Order 12898 (59 FR 7629; February 16, 1994) and Executive Order 14008 (86 FR 7619,
January 27, 2021) establish federal executive policy on environmental justice. Executive Order 12898's
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 people of color and low-income populations in the United States. EPA defines
environmental justice as the fair treatment and meaningful involvement of all people regardless of race,
color, national origin, or income with respect to the development, implementation, and enforcement of
environmental laws, regulations, and policies.35 Executive Order 14008 (86 FR 7619; January 27, 2021)
also calls on Agencies to make achieving environmental justice part of their missions "by developing
programs, policies, and activities to address the disproportionately high and adverse human health,
environmental, climate-related and other cumulative impacts on disadvantaged communities, as well as
the accompanying economic challenges of such impacts." It also declares a policy "to secure
environmental justice and spur economic opportunity for disadvantaged communities that have been
historically marginalized and overburdened by pollution and under-investment in housing, transportation,
water and wastewater infrastructure and health care." EPA also released its "Technical Guidance for
35 Fair treatment occurs when "no group of people should bear a disproportionate burden of environmental harms
and risks, including those resulting from the negative environmental consequences of industrial, governmental, and
commercial operations or programs and policies" (U.S. EPA, 2011). Meaningful involvement occurs when"l)
potentially affected populations have an appropriate opportunity to participate in decisions about a proposed activity
[i.e., rulemaking] that will affect their environment and/or health; 2) the population's contribution can influence [the
EPA's] rulemaking decisions; 3) the concerns of all participants involved will be considered in the decision-making
process; and 4) [the EPA will] seek out and facilitate the involvement of population's potentially affected by EPA's
rulemaking process" (U.S. EPA, 2015). A potential environmental justice concern is defined as "actual or potential
lack of fair treatment or meaningful involvement of minority populations, low-income populations, tribes, and
indigenous peoples in the development, implementation and enforcement of environmental laws, regulations and
policies" (U.S. EPA, 2015). See also https://www.epa.gov/environmentaljustice.
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Assessing Environmental Justice in Regulatory Analysis" (U.S. EPA, 2016) to provide recommendations
that encourage analysts to conduct the highest quality analysis feasible, recognizing that data limitations,
time and resource constraints, and analytic challenges will vary by media and circumstance.
As noted in the Allocation Framework Rule RIA, the production and consumption of HFCs is expected to
result in changes in the emissions of chemicals which burden communities surrounding HFC production
facilities. Because of the limited information regarding how much of each substitute would be produced,
which substitutes would be used, and what other factors might affect production and emissions at those
locations, it's unclear to what extent baseline risks from hazardous air toxics for communities living near
HFC production facilities may be affected. We do understand that communities neighboring facilities that
currently produce HFCs and those that are likely to produce HFC alternatives are often overburdened and
disadvantaged. The Agency has a strong interest in mitigating undue burden on underserved communities.
EPA stated its intention in the Allocation Framework Rule to "continue to monitor the impacts of this
program on HFC and substitute production, and emissions in neighboring communities, as we move
forward to implement this rule" (see 86 FR 55129). EPA will continue to work to address environmental
justice and equity concerns for the communities near the facilities identified in this analysis.
6.3 Environmental Justice Analysis for this Rule
In the Allocation Framework Rule, EPA summarized the public health and welfare effects of GHG
emissions (including HFCs), including findings that certain parts of the population may be especially
vulnerable to climate change risks based on their characteristics or circumstances, including 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 limited resources due to factors including but not limited to geography,
access, and mobility (86 FR 55124 - 55125). Potential impacts of climate change raise environmental
justice issues. Low-income communities can be especially vulnerable to climate change impacts because
they tend to have more limited capacity to bear the costs of adaptation and are more dependent on
climate-sensitive resources such as local water and food supplies. In corollary, some communities of
color, specifically populations defined jointly by both ethnic/racial characteristics and geographic
location, may be uniquely vulnerable to climate change health impacts in the United States.
As discussed in more detail in the RIA for the Allocation Framework Rule, the environmental justice
benefits of reducing climate change are significant. The proposed Subsection (h) rule is expected to result
in benefits in the form of reduced GHG emissions, including by reducing the rates of leakage of HFCs to
the atmosphere from new and existing equipment. The analysis conducted for this rule also estimates that
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a portion of these benefits would be incremental to emissions reductions that were anticipated under the
Allocation Framework Rule alone, thus further reducing the risks of climate change.
HFCs are not a local pollutant and have low toxicity to humans. The Proposed Rule is expected to result
in increased activity at HFC recovery and reclamation facilities. EPA does not anticipate that there are
significant increased risks to human health in communities near these facilities due to the presence or
potential leakage of the HFCs themselves. It is possible that other chemicals which are potential
byproducts of HFC reclamation processes, such as petroleum-based lubricants and waste oils, may be
released from these facilities. In addition, the RCRA provisions would allow lower flammability spent
refrigerants to be sent to HFC recovery and reclamation facilities, potential increasing the potential for
fires at the facilities. To help address the risks posed by fires, the proposed standards include emergency
preparedness and response requirements.
For the purposes of this rule, EPA assessed the characteristics of communities near facilities we expect to
be affected by this rule (i.e., HFC reclamation facilities). EPA used data from reports required under
Section 608 of the Clean Air Act,36 EPA's ECHO database37 and information provided by company
websites to identify facilities that are active HFC reclaimers. Once reclaim facility locations were
identified, EPA retrieved the Facility Registry Service (FRS) IDs for each facility using the Agency's
FRS national dataset38 EPA derived additional information on the communities surround the facilities
included this analysis using data from AirToxScreen 2019 (EPA 2023b) and the Census" American
Community Survey 2019 (U.S. Census Bureau 2021). These steps were conducted to facilitate extracting
1) an environmental profile and 2) demographic information within 1, 3, 5 and 10 miles for each facility.
Fenceline communities may be impacted by emissions or chemical releases from facilities of the type
identified here, although there is uncertainty about the nature and risks of potential emissions or chemical
releases. This analysis notes several limits to our ability to assess the impact this rule on the exposure that
specific communities may face:
• The facilities that we identified are diverse, ranging in size from small, boutique facilities
that recover and reclaim HFCs for small market to large chemical production facilities
that have several lines of business that may result in atmospheric emissions. EPA does
not have information that allows us to distinguish possible fugitive emissions from HFC
reclamation and other potential chemical processing or manufacture.
36 EPA reviewed Section 608 annual reclamation reports to determine facilities that currently reclaim HFCs and may
therefore be expected to continue to do so in the future.
37 EPA's Enforcement and Compliance History Online (ECHO) database was used to verify locations of HFC
reclamation facilities
38 FRS National Data Set available at https://www.epa.qov/frs/epa-frs-facilities-state-sinqle-file-csv-download
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• Many of the communities near the facilities expected to be affected by this rule are also
near other sources of toxic emissions which contribute to environmental justice concerns.
• The proposed rule, and other changes in the HFC reclamation market, would likely result
in an overall increase in reclamation, but may result in increases or decreases in the
activity at any given facility, or the construction of additional facilities.
• In regard to the effect of the proposed RCRA alternative standards on flammable
refrigerants, any potential increase in volumes sent to reclamation facilities would likely
be offset by a decrease in volume sent to incineration facilities, or vented illegally.
Due to the limitations of the current data, we cannot make conclusions about the impact of this rule on
individuals or specific communities. For the purposes of identifying environmental justice issues,
however, it is important to understand the characteristics of the communities surrounding these facilities
to better ensure that future actions, as more information becomes available, can improve outcomes.
Following the format used for the Allocation Framework Rule RIA, this analysis focuses on information
that is available on the demographics and baseline exposure of the communities near these facilities.
6.4 Aggregate Average Characteristics of Communities Near Potentially Affected
Production Facilities
The RIA for the Allocation Framework Rule notes that a key issue for evaluating potential for
environmental justice concerns is the extent to which an individual might be exposed to feedstock,
catalyst, or byproduct emissions from production of HFCs or HFC alternatives. This proposed rule may
result in increases in the numbers of individuals exposed to chemicals in the process of reclaiming and
recycling HFCs.
EPA has not undertaken an analysis of how potential emissions from HFC reclamation affect nearby
communities. However, a proximity-based approach can identify correlations between the location of
these identified reclamation facilities and potential effects on nearby communities. Specifically, this
approach assumes that individuals living within a specific distance of an HFC reclamation facility are
more likely to be exposed to releases the reclamation process. Those living further away are less likely to
be exposed to these releases. Census block groups that are located within 1, 3, 5 and 10 miles of the
facility are selected as potentially relevant distances to proxy for exposure. Socioeconomic and
demographic data from the American Community Survey 5-year data release for 2019 is used to examine
whether a greater percentage of population groups of concern live within a specific distance from a
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production facility compared to the national average. The national average for rural areas is also presented
since four of the nine production facilities expected to be impacted by this rule are classified as rural. 3 9
In addition, AirToxScreen data from 2019 for census tracts within and outside of a 1-, 3-, 5- and 10-mile
distance are used to approximate the cumulative baseline cancer and respiratory risk due to air toxics
exposure for communities near these production facilities. The total cancer risk is reported as the risk per
million people if exposed continuously to the specific concentration over an assumed lifetime. The total
respiratory risk is reported as a hazard quotient, which is the exposure to a substance divided by the level
at which no adverse effects are expected. Both total risk measures are the sum of the individual risk
values for all the chemicals evaluated in the AirToxScreen database (EPA 2023b). Note that these risks
are not necessarily only associated with a specific HFC production facility. Industrial activity is often
concentrated (i.e., multiple plants located within the same geographic area).
Table 6-1 presents summary information for the demographic data and AirToxScreen risks averaged
across the nineteen communities near the identified production facilities compared to the overall national
average.
The values in the last four columns reflect population-weighted averages across the Census block groups
within the specified distance of the facility. While it is not possible to disaggregate the risk information
from AirToxScreen by race, ethnicity or income, the overall cancer and respiratory risk in communities
within 1, 3, 5 or 10 miles of an identified production facility is does not appear to be markedly greater
than either the overall or rural national average.
Table 6-1: Overall Community Profile and 2019 AirToxScreen Risks for Communities Near
Identified Facilities
Within 1
Within 3
Within 5
Within 10
Overall
mile
miles
miles
miles
National
of
of
of
of
Average
production
production
production
production
facility
facility
facility
facility
% White (race)
72
67
62
60
60
39 The US Census definition of "rural" is used. The term rural is applied to census areas that are not classified as
urbanized areas or urban clusters and have a population density below 2,500 people per square mile. Census also
looks at other factors before classifying an area as rural including adjacency to an urban area. For the 1-mile radius,
population density near an HFC production facility ranges from 40 people per square mile to 306 people per square
mile for each of the seven facilities in rural areas. For the 3-mile radius, population density near a facility ranges from
46 people per square mile to 1,262 people per square mile. However, if the majority of census blocks within our buffer
are urban-adjacent, we continue to use the overall national or state level average as a basis of comparison (U.S.
Census Bureau 2021).
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% Black or
African American
13
12
15
17
18
(race)
% Other (race)
15
21
23
24
22
% Hispanic
(ethnic origin)
18
31
34
30
24
Median
Household Income
71
77
74
72
75
(lk 2019$)
% Below Poverty
Line
7.3
7.6
8.6
8.4
7.4
% Below Half the
Poverty Line
5.8
5.9
6.2
6.6
6.1
Total Cancer Risk
(per million]
26
25
26
27
27
Total Respiratory
Risk (hazard
0.31
0.32
0.33
0.33
0.34
quotient)
Notes: Demographic definitions are as described in the 2019 American Community Survey (U.S. Census Bureau
2021). The "hazard quotient" is defined as the ratio of the potential exposure to a substance and the level at which
no adverse effects are expected (calculated as the exposure divided by the appropriate chronic or acute value). A
hazard quotient of 1 or lower means adverse noncancer effects are unlikely and, thus, can be considered to have
negligible hazard. For HQs greater than one, the potential for adverse effects increases, but we do not know by how
much. Total cancer and respiratory risk are drawn from the AirToxScreen database (2019) (EPA 2023b).
Looking across the nineteen facilities (Table 6-1), a higher percentage of non-white individuals live in the
communities near HFC reclamation facilities compared to the national average. Within one mile of the
facilities, the percentage of Black or African Americans slightly lower than the national average, (12
percent compared to 13 percent) but the percentage increases to 15 percent, 17 percent and 18 percent for
the 3 miles, 5 miles, and ten miles, respectively. For the communities near these facilities, there are more
whose race is identified as "other," and whose ethnicity is "Hispanic" than the national average. In these
communities, the percentage of White residents is higher within one mile of the facilities than farther
away. Within one mile, 67 percent of the residents are white, which is lower than the national average of
72 percent.
Median income is generally higher for the communities near these facilities compared to the national
average, with the highest median income within the 1-mile radius ($77,000 per year, compared to the
national average of $71,000). However, these communities generally have higher percentages of low-
income households (below the poverty line) and very low-income households (with incomes less than
half the poverty line). The national percentage of households with incomes less than half of the poverty
line is 5.8%. Within 1 mile of these specific facilities, the average percentage of households with incomes
less than half of the poverty line 5.9 percent. At the 3- and 5-mile distances, the number rises to 6.2
percent and 6.6 percent—it is 6.1 percent in the average 10-mile radius.
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For this analysis, we use the most recent 2019 AirToxScreen data for total cancer risk and total
respiratory risk. The overall national average total cancer risk using the newest data 26 per million. The
Total Respiratory Index average for the nation as a whole is 0.31. The average aggregate risks in
communities near these facilities are generally higher than the national averages. The analysis shows,
however, that Total Cancer Risk is lower for those within the 1-mile average radius and increase at the 3-,
5-, and 10-mile radii. While the Total Respiratory index for communities within one mile of these
nineteen facilities (.32 compared to the national average of .31) the risk for those closest to the facilities
appears smaller than for those at greater distances. The analysis shows that 3-mile, 5-mile, and 10-mile
Total Respiratory Risk averages are 0.33, 0.33, and 0.34 respectively.
6.5 Previous Violation and Enforcement Actions
Table 6-2 below provides summary data for facilities identified in the above analysis that are currently
registered with one or more EPA compliance regimes under major statutes including CAA, RCRA, and
the Clean Water Act (CWA). The table also provides a count of the number of facilities identified within
a Native American tribal boundary or located within Census block groups in the 80th or higher national
percentile of one of the primary EJ indexes of EJSCREEN, EPA's screening tool for EJ concerns. These
data were obtained from EPA's Enforcement and Compliance History Online (ECHO). Notably, of the 19
facilities included in the above analysis, 12 are currently registered under CAA, RCRA, NPDES, and/or
CWA compliance regimes.
Table 6-2: Number offacilities falling under one or more environmental compliance regime
Variable
Description of Variable
Count of
Identified HFC
Reclaim
Facilities
AIRFLAG
Facility has an Air Facility System (AFS) ID
2
NPDES_FLAG
Facility has a Clean Water Act NPDES ID
4
SD WIS_FLA G
Facility has a Safe Drinking Water Information System
(SDWIS) ID
0
RCRAFLAG
Facility has a Resource Conser\>ation and Recovery Act
Information System (RCRAlnfo) ID
8
TRIFLAG
Facility has a Toxics Release Inventory (TRI) ID (most recent
reporting vear)
1
GHGFLAG
Facility has a Greenhouse Gas (E-GGRT) ID
0
FAC INDIAN CNTRY
FLG
FRS Tribal Code Flag - a Y/Nflag indicating whether or not an
associated EPA program reported the facility as being within a
Native American tribal boundary.
0
FA CMAJORFLA G
Determines if the facility is a designated as a major.
0
FA C_A CTIVEFLA G
A Y/Nflag indicating if any of the associated IClS-Air, 1C1S-
NPDES, RCRA or SDWA permits are in an active status.
12
70
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EJSCREEN_FLAG_US Indicates facilities located in Census block groups in the 80th 4
or higher national percentile of one of the primary
environmental justice (EJ) indexes of EJSCREEN, EPA's
screening tool for EJ concerns.
Source: EPA's Enforcement and Compliance History Online (ECHO). Note: While EPA places a high priority on ensuring the
integrity of the national enforcement and compliance databases, some incorrect data may be present due to the large amount of
information compiled across multiple streams of data from state, local, and tribal agencies. Known data quality problems are
discussed at https://echo.epa.gov/resources/echo-data/known-data-problems
Tables Table 6-3Table 6-4Table 6-5 below provide further information on formal and informal
enforcement actions which have occurred at identified facilities within the last 5 years. Out of the 12
facilities, four are registered under CWA, eight under RCRA, and two under CAA. Two facilities have
recent CWA enforcement violations, as shown in Table 6-3. None of the identified facilities have recent
RCRA or CAA enforcement violations.
Table 6-3: Clean Water Act Compliance Status and Recent Enforcement History by Facility
Facility Name
CWA
CWA Compliance
Informal
Formal Enforcement
NPDES
Status
Enforcement
Actions (last 5 years)
Registration
Actions (last 5
years)
CERTIFIED
N
REFRIGERANT
SERVICES INC
NEWCOMB
N
MECHANICAL INC
RECLAIM PA N
Y
Failure to Report
4
3
DELAWARE AVE
DMR - Not Received
FAC
ACS RECLAMATION
N
& RECOVERY INC
REFRIGERANT
N
HANDLING INC
C & M ENTERPRISE
N
OF CHRISTMAS
FLORIDA
TRADEWATER ELK
N
GROVE VILLAGE
PERFECT SCORE
Y
No Violation
0
0
TOO, LTD
Identified
A-GAS US
Y
No Violation
0
0
Identified
NATIONAL
Y
Violation Identified
0
0
REFRIGERANTS INC
HUDSON
N
TECHNOLOGIES CO
GOLDEN
N
REFRIGERANT
Source: EPA's Enforcement and Compliance History Online (ECHO). Note: While EPA places a high priority on ensuring the
integrity of the national enforcement and compliance databases, some incorrect data may be present due to the large amount of
information compiled across multiple streams of data from state, local, and tribal agencies. Known data quality problems are
discussed at https://echo.epa.gov/resources/echo-data/known-data-problems
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Table 6-4: Resource Recovery and Conservation Act (RCRA) Compliance Status and Recent
Enforcement History by Facility
Facility Name
RCRA
Registration
RCRA Compliance Status
CERTIFIED
REFRIGERANT SERVICES
INC
Y
No Violation Identified
NEWCOMB MECHANICAL
INC
Y
No Violation Identified
RECLAIM PA N
DELAWARE AVE FAC
Y
No Violation Identified
ACS RECLAMATION &
RECOVERY INC
Y
No Violation Identified
REFRIGERANT
HANDLING INC
Y
No Violation Identified
C & M ENTERPRISE OF
CHRISTMAS FLORIDA
Y
No Violation Identified
TRADEWATER ELK
GROVE VILLAGE
Y
No Violation Identified
PERFECT SCORE TOO,
LTD
N
A-GAS US
N
NATIONAL
REFRIGERANTS INC
N
HUDSON
TECHNOLOGIES CO
Y
No Violation Identified
GOLDEN REFRIGERANT
N
Source: EPA's Enforcement and Compliance History Online (ECHO). Note: While EPA places a high priority on ensuring the
integrity of the national enforcement and compliance databases, some incorrect data may be present due to the large amount of
information compiled across multiple streams of data from state, local, and tribal agencies. Known data quality problems are
discussed at https://echo.epa.gov/resources/echo-data/known-data-problems
Table 6-5: Clean Air Act (CAA) Compliance Status and Recent Enforcement History by Facility
Facility Name
CAA Air Facility
System (AFS)
Registration
CAA Compliance Status
CERTIFIED
N
REFRIGERANT SERVICES
INC
NEWCOMB MECHANICAL
N
INC
RECLAIM PA N
N
DELAWARE AVE FAC
ACS RECLAMATION &
N
RECOVERY INC
REFRIGERANT
N
HANDLING INC
C & M ENTERPRISE OF
N
CHRISTMAS FLORIDA
72
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TRADEWATER ELK
GROVE VILLAGE
N
PERFECT SCORE TOO,
LTD
N
A-GAS US
N
NATIONAL
REFRIGERANTS INC
N
HUDSON
TECHNOLOGIES CO
Y
No Violation Identified
GOLDEN REFRIGERANT
Y
No Violation Identified
Source: EPA's Enforcement and Compliance History Online (ECHO). Note: While EPA places a high priority on ensuring the
integrity of the national enforcement and compliance databases, some incorrect data may be present due to the large amount of
information compiled across multiple streams of data from state, local, and tribal agencies. Known data quality problems are
discussed at https://echo.epa.gov/resources/echo-data/known-data-problems
6.6 Conclusion
The provisions in this proposed rule are expected to result in benefits in the form of reduced GHG
emissions. The analysis conducted for this proposed rule also estimates that a portion of these benefits
would be incremental to emissions reductions that were anticipated under the Allocation Framework Rule
and 2024 Allocation Framework Rule RIA addendum, thus further reducing the risks of climate change.
While providing additional overall climate benefits, this rule may also result in changes in emissions of
air pollutants or other chemicals which are potential byproducts of HFC reclamation processes at affected
facilities. The market for reclaimed HFCs could drive changes in potential risk for communities living
near these facilities. However, the nature and location of the emission changes are uncertain. Moreover,
there is insufficient information at this time about which facilities will change reclamation processes. The
proximity analysis of these communities demonstrates that:
• Total baseline cancer risk and total respiratory risk from air toxics (not all of which stem
from HFC reclamation) is generally higher within 1-10 miles of an HFC reclamation
facility;
• Higher percentages of low income and very low-income individuals live near HFC
reclamation facilities compared to the overall average at the national level;
• Generally, higher percentages of Black or African American individuals live near these
facilities;
• Higher percentages of individuals whose race is identified as "Other" live near these
facilities;
• Higher percentages of individuals of Hispanic ethnicity live near these facilities;
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• It is not clear the extent to which these baseline risks are directly related to HFC
reclamation and
• continued analysis of HFC reclamation facilities and associated environmental justice
concerns is appropriate.
Given limited information at this time, it is unclear to what extent this rule will impact existing
disproportionate adverse effects on communities living near HFC reclamation facilities4" The Agency
will continue to evaluate the impacts of this proposed rulemaking on communities with environmental
justice concerns and consider further action, as appropriate, to protect health in communities affected by
HFC reclamation.
References
Abt Associates. Supplemental Automatic Leak Detection System Draft Analysis. Prepared for EPA
Stratospheric Protection Division, 2023.
American Public Transportation Association (APTA). Public Transportation Fact Book, 2022.
https://www.apta.com/wp-content/uploads/APTA-2022-Public-Transportation-Fact-Book.pdf.
Banzhaf, Spencer, Lala Ma, and Christopher Timmins. "Environmental Justice: The Economics of Race,
Place, and Pollution/' Journal of Economic Perspectives, vol. 33, no.l, 2019, pp. 185-208, doi:
10.1257/iep.33.1.185.
Barnish, Timothy J., Michael R. Muller, and Donald J. Kasten. Motor maintenance: a survey of
techniques and results. Proceedings of the 1997 ACEEE Summer Study on Energy Efficiency in
Industry. American Council for an Energy-Efficient Economy, Washington, D.C., 1997.
Brush, Adrian, Eric Masanet, and Ernst Worrell. Energy Efficiency Improvement and Cost Saving
Opportunities for the Dairy Processing Industry. Ernest Orlando Lawrence Berkeley National
Laboratory, 2011, https://www.osti. gov/servlets/purl/1171534.
Bureau of Labor Statistics, U.S. Department of Labor (BLS). "Occupational Employment and Wages,
May 2022."' Bls.gov, 2022, https://www.bls.gov/oes/current/oes499021.htm.
40 Statements made in this chapter on the environmental justice concerns of the AIM Act draw support from the following
citations: Banzhaf, Spencer, Lala Ma, and Christopher Timmins. 2019. Environmental justice: The economics of race, place, and
pollution. Journal of Economic Perspectives; Hernandez-Cortes, D. and Meng, K.C., 2020. Do environmental markets cause
environmental injustice? Evidence from California's carbon market (No. w27205). NBER; Hu, L., Montzka, S.A., Miller, B.R.,
Andrews, A.E., Miller, J.B., Lehman, S.J., Sweeney, C., Miller, S.M., Thoning, K., Siso, C. and Atlas, E.L., 2016. Continued
emissions of carbon tetrachloride from the United States nearly two decades after its phaseout for dispersive uses. Proceedings of
the National Academy of Sciences; Mansur, E. and Sheriff, G., 2021. On the measurement of environmental inequality: Ranking
emissions distributions generated by different policy instruments.; U.S. EPA. 2011. Plan E.T 2014. Washington, DC: U.S. EPA,
Office of Environmental Justice.; U.S. EPA. 2015. Guidance on Considering Environmental Justice During the Development of
Regulatory Actions. May 2015.; USGCRP. 2016. The Impacts of Climate Change on Human Health in the United States: A
Scientific Assessment. U.S. Global Change Research Program, Washington, DC.
74
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CARB. Re frigerant Management Program. 2009a,
https://www.arb.ca.gov/regact/2009/gwprmp09/gwprmpQ9.htm.
CARB. Initial Statement of Reasons for Proposed Regulation for the Management of High Global
Warming Potential Refrigerants for Stationary Sources. 2009b,
http://www.arb.ca.gov/cc/rmp/RMP ISOR&Appendices(WithE&F).pdf.
Crippa, Monica., et al. " Food systems are responsible for a third of global anthropogenic GHG
emission, "s, Nureat Fo,ovol. d 2, 198-209, 2021, https://doi.org/10.1038/s43016-021-0Q225-9.
Heating, Air Conditioning & Refrigeration Distributors Int'l v. EPA, 71 F.4th 59, 68 (D.C. Cir. 2023)
Interagency Working Group on Social Cost of Greenhouse Gases, United States Government (IWG
2021), 86FR 24669, 2021, https://www.whitehouse.gov/ wp-content/ uploads/ 2021/ 02/
TechnicalSupportDocument SocialCostofCarbonMethaneNitrousOxide.pdf.
Intergovernmental Panel on Climate Change (IPCC). 2006. 2006IPCC Guidelines for National
Greenhouse Gas Inventories, Volume 3: Industrial Processes and Product Use, Chapter 7: Emissions
of Fluorinated Substitutes for Ozone Depleting Substances. 2006, http://www.ipcc-
nggip.iges.or.jp/public/2006gl/pdf/3 Volume3/V3 7 Ch7 OPS Substitutes.pdf.
Intergovernmental Panel on Climate Change [IPCC] and Technology and Economic Assessment Panel
[TEAP] (IPCC/TEAP). Special Report on Safeguarding the Ozone Layer and the Global Climate
Systems, 2005, . https://www.ipcc.ch/pdf/special-reports/sroc/sroc full.pdf.
OMB Circular A-4. Washington, D.C.: Executive Office of the President, Office of Management and
Budget, 2003, https://www.federalregister.gOv/d/03-25606/p-3.
ReFED. Insights Engine Methodology, 2020,
https://insights.refed.org/methodology#:~:text=Insights%20Engine%20Methodologies,case%20studi
es%2C%20and%20industry%20research.
Stratus Consulting Inc. (Stratus). Screening Analysis to Examine the Economic Impact of Proposed
Revisions to the Refrigerant Recycling and Emissions Rule. 2009.
U.S. Census Bureau. "New Census Report Shows Public Transportation Commuters Concentrated in
Large Metro Areas of the United States." Censns.gov, 1 Apr. 2021,
https://www.census.gov/newsroom/press-releases/2021/public-transportation-commuters.html.
U.S. EPA. "Technical Support Document: Analysis of the Economic Impact and Benefits of Final
Revisions to the National Recycling and Emission Reduction Program." Regiilations.gov, 2016,
https://www.regulations.gov/document?D=EPA-HQQAR-2015-0453-0225.
U.S. EPA. EPA's Vintaging Model representing proposed 2024 Allocation Rule RIA. Version VMIO
file_v4.4 02.04.16 2024 Allocation Rule. 2023a.
U.S. EPA. "Air Toxics Screening Assessment." Epa.gov, 2023b, https://www.epa.gov/AirToxScreen.
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U.S.EPA. "Regulatory Impact Analysis for Phasing Down Production and Consumption of
Hydrofluorocarbons (HFCs)." Regulations.gov, 5 Oct. 2021,
https://www.regulations.gov/document/EPA-HO-OAR-2021-0044-Q227.
U.S. EPA. Draft Addendum to the Regulator}' Impact Analysis for the Phasedown of Hydrofluorocarbons.
Notice of Proposed Rulemaking - Phasedown of Hydrofluorocarbons: Allowance Allocation
Methodology for 2024 and Later Years. Oct. 2022a,
https://www.epa.gov/svstem/files/documents/2Q22-10/8838-NPRM Regulatorv-Impact-Analvsis-
Addendum.pdf.
Environmental Protection Agency ()2022b. Available online at:
U.S. EPA Enforcement and Compliance History Online (ECHO).
https://echo.epa.gov/Yasaka, Yoshihito, et al. "Life-Cycle Assessment of Refrigerants for Air
Conditioners Considering Reclamation and Destruction." Sustainability, vol. 15, no.l, 2023, p. 473,
doi: 10.3390/sul5010473.
Appendices:
Appendix A. Vintaging Model Leak Rate Distributions
The Vintaging Model simulates equipment emissions and consumption using average leak rates,
consistent with 2006 IPCC Guidelines for National Greenhouse Gas Inventories (IPCC 2006) 41 These
average leak rates represent the full spectrum of potential equipment leak events, in which equipment may
experience negligible or more significant and/or catastrophic leaks. In order to simulate a more real-world
distribution of leak rates, equipment stock was distributed into quintiles, each containing 20 percent of
units, where the leak rate distributions equal the weighted average leak rate modeled in the Vintaging
41 For chillers, large retail food (rack systems), cold storage, and industrial process refrigeration systems, the leak rate
distributions were applied to the average leak rate modeled in the Vintaging Model as of 2025 with a 40 percent leak rate
reduction, which is consistent with the assumption that larger refrigeration and AC equipment will experience enhanced leak
recovery under the 2024 Allocation Rule as explained in the RIA to the Allocation Framework Rule and associated addenda to
that RIA.
76
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Model for each equipment type. The representative leak rate for each quintile was estimated such that
each subsector has at least 20 percent of its stock (i.e., one quintile) above the threshold leak rate.
Table A-0 summarizes the leak rate distributions for equipment containing 15 or more pounds of
refrigerant considered in the analysis and equipment between 5 and 15 pounds of refrigerant, for the
alternate policy scenario summarized in Appendix F.
For most subsectors, the quintiles were established in increments of 25% percent above or below the
average leak rate (i.e., quintile 1 is 50 percent below, quintile 2 is 25 percent below, quintile 3 is the
average, quintile 4 is 25 percent above, and quintile 5 is 50 percent above). However, for some
subsectors, the average leak rate modeled in the Vintaging Model was significantly below the threshold
leak rate, such that the upper quintile leak rate did not exceed the threshold leak rate. In those cases, the
fifth quintile leak rate was set to be significantly higher than the average leak rate to ensure that each
subsector had some portion of equipment stock above the leak rate threshold and therefore was affected
by the proposed rulemaking. In those cases, the quintile 1 through 4 values were also manipulated such
that the weighted average leak rate across all five quintiles still equaled the average leak rate (i.e., quintile
3).42
Table A-l: Leak Rate Distributions for Equipment
Equipment
Type
Quintil
e
Average
Sector
Vintaging Model Subsector
1
2
3
4
5
Leak
Rate
Subsectors between 15 and 50 pounds
CC
Passenger
Train AC
Passenger Train AC
% Relative to
Average
0.88
1.1
1.4
1.6
495
2.1
Assumed Leak
Rate (%)
0.018
0.023
0.029
0.034
10
cc
School & Tour
Bus AC
School & Tour Bus ACa
% Relative to
Average
50
75
100
125
150
10
Assumed Leak
Rate (%)
4.8
7.2
10
12
14
CR
Rail Transport
AC
Vintage Rail Transport
% Relative to
Average
25
50
100
150
175
36
Assumed Leak
Rate (%)
15
24
36
48
57
CR
Condensing
Unit
HCFC-22 Large Condensing
Units (Medium Retail Food)0
% Relative to
Average
50
75
100
125
150
15
42 Because the average Vintaging Model leak rate for certain subsectors (e.g., chillers, IPR) are significantly lower than the
threshold leak rates of 10% for comfort cooling and 30% for IPR, it is not possible for the weighted average leak rate across the
quintiles to equal the average leak rate using the percentages above.
77
-------
Sector
Equipment
Type
Vintaging Model Subsector
1
(
2
Juintil
3
e
4
5
Average
Leak
Rate
Assumed Leak
Rate (%)
6.5
11
15
19
23
CC
Transit Bus AC
Transit Bus AC
% Relative to
Average
50
75
100
125
150
10
Assumed Leak
Rate (%)
5
7.5
10
12
15
CC
Modern Rail
Transport
Modern Rail Transport
% Relative to
Average
50
75
100
125
150
33
Assumed Leak
Rate (%)
17
25
33
41
50
Subsectors greater than 50 pounds
CC
Chiller
CFC-11 Centrifugal
Chillers'3
% Relative to
Average
0
0
0
0
850
2.2
Assumed Leak
Rate (%)
0
0
0
0
11
CC
Chiller
CFC-12 Centrifugal
Chillers'3
% Relative to
Average
0
0
0
0
700
2.0
Assumed Leak
Rate (%)
0
0
0
0
10
CC
Chiller
R-500 Chillers'3
% Relative to
Average
0
0
0
0
700
2.0
Assumed Leak
Rate (%)
0
0
0
0
10
CC
Chiller
CFC-114 Chillers'3
% Relative to
Average
0
0
0
0
750
2.1
Assumed Leak
Rate (%)
0
0
0
0
10
CC
Chiller
Screw Chillers'3
% Relative to
Average
0
0
0
0
1300
2.1
Assumed Leak
Rate (%)
0
0
0
0
10
CC
Chiller
Scroll Chillers'3
% Relative to
Average
0
0
0
0
1300
2.1
Assumed Leak
Rate (%)
0
0
0
0
10
CC
Chiller
Reciprocating Chillers'3
% Relative to
Average
0
0
0
0
850
2.0
Assumed Leak
Rate (%)
0
0
0
0
10
IPR
IPR
CFC-11 Industrial Process
Refrigeration13
% Relative to
Average
0
0
0
0
850
6.8
Assumed Leak
Rate (%)
0
0
0
0
34
IPR
IPR
CFC-12 Industrial Process
Refrigeration13
% Relative to
Average
0
0
0
0
1250
6.0
Assumed Leak
Rate (%)
0
0
0
0
30
IPR
IPR
HCFC-22 Industrial Process
Refrigeration
% Relative to
Average
0
0
0
0
500
6.2
Assumed Leak
Rate (%)
0
0
0
0
31
78
-------
Sector
Equipment
Type
Vintaging Model Subsector
1
(
2
Juintil
3
e
4
5
Average
Leak
Rate
CR
Cold Storage
CFC-12 Cold Storage
% Relative to
Average
0
50
75
100
275
9.2
Assumed Leak
Rate (%)
0
4.6
6.9
9.2
25
CR
Cold Storage
HCFC-22 Cold Storage
% Relative to
Average
0
50
75
100
275
7.3
Assumed Leak
Rate (%)
0
3.7
5.5
7.3
20
CR
Cold Storage
R-502 Cold Storage
Assumed Leak
Rate (%)
0
50
75
100
275
8.3
% Relative to
Average
0
4.2
6.3
8.3
23
CR
Rack
CFC-12 Large Retail Food
Assumed Leak
Rate (%)
50
75
100
125
150
15
% Relative to
Average
7.5
11
15
19
22
CR
Rack
R-502 Large Retail Food
Assumed Leak
Rate (%)
50
75
100
125
150
15
Assumed Leak
Rate (%)
7.5
11
15
19
22
CR
Marine
Transport
Merchant Fishing Transport
% Relative to
Average
50
75
100
125
150
33
Assumed Leak
Rate (%)
17
25
33
41
50
CR
Marine
Transport
Reefer Ships
% Relative to
Average
50
75
100
125
150
23
Assumed Leak
Rate (%)
12
17
23
29
35
Note: Values may not sum due to independent rounding
a The average leak rate modeled does not equal the average leak rate for these subsectors in the Vintaging Model.
b 33 percent of units in the School & Tour Bus AC sector are modeled with a charge size above 15 lbs.
c Vintaging Model subsectors are often defined by the ODS that was original used, as that affects the transition choices. This
analysis does not consider the effects the proposed rule may have on ODS emissions.
Table A-2: Leak Rate Distributions for Equipment between 5 and 15 pounds
Sector
Equipment Type
Quintile
Average
vintaging iviouci suusector
1
2
3
4
5
Leak Rate
Subsectors between 5 and 15 pounds
IPR
Ice Makers
Ice Makers3
% Relative to
Average
15
30
45
60
350
3.0
Assumed Leak
Rate (%)
0.45
0.90
1.4
1.8
11
CR
Road Transport
Road Transport
% Relative to
Average
50
75
100
125
150
33
Assumed Leak
Rate (%)
17
25
33
41
50
CR
Intennodal
Containers
Intennodal Containers
% Relative to
Average
50
75
100
125
150
21
79
-------
Sector Equipment Type
Vintaging Model Subsector
1
2
Quintile
3 4
5
Average
Leak Rate
Assumed Leak
Rate (%)
10
16
21
26
31
CC
School & Tour Bus
AC
School & Tour Bus
ACb
% Relative to
Average
50
75
100
125
150
10
Assumed Leak
Rate (%)
4.8
7.2
10
12
14
CR
Condensing Units
HCFC-22 Small
Condensing Units
(Medium Retail Food)
% Relative to
Average
0
25
75
100
300
7.8
Assumed Leak
Rate (%)
0
1.9
5.8
7.8
23
a The average leak rate modeled does not equal the average leak rate for these subsectors in the Vintaging Model.
b66 percent of units in the School & Tour Bus AC sector are modeled with a charge size below 15 lbs.
c Vintaging Model subsectors are often defined by the ODS that was original used, as that affects the transition
choices. This analysis does not consider the effects the proposed rule may have on ODS emissions.
80
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Appendix B. Evaluation of Potential Costs and Benefits of Reclamation
Demand for Reclaimed Refrigerant
The proposed requirement to use reclaimed refrigerant to fill new equipment and service existing systems
in specific sectors and subsectors could result in both cost savings and avoided GHG emissions associated
with avoiding virgin production and destruction of HFC refrigerant. The refrigerant consumption in the
proposed (sub)sectors estimated in EPA's Vintaging Model is approximately 40,100 MT in 2028 and
40,300 MT in 2029 (EPA 2023a), as shown in Error! Reference source not found.. Note that these
totals only reflect the AIM-listed HFCs; for example, HFOs, whether neat or in a blend with HFCs, are
not included because the proposal to require reclaimed refrigerants applies only to the regulated HFCs.
Table B-l: Initial Charge and Service Demand of HFCs for Applicable Subsectors in 2028 and
2029
2028
2029
Sector
Equipment
Type
Initial
Charge
(MT)
Service
Demand
(MT)
Initial
Charge
(MT)
Service
Demand
(MT)
Residential
Unitary AC
10,607
N/Aa
10,519
N/A
Small
Commercial
Unitary AC
1,502
N/A
1,589
N/A
Residential and Light Commercial AC
Large
Commercial
Unitary AC
149
N/A
183
N/A
Window Units
5,827
N/A
5,943
N/A
Packaged
terminal
AC/heat pumps
(PTAC/PTHP)
248
N/A
247
N/A
Ground-source
heat pumps
(GSHP)
276
N/A
270
N/A
Cold Storage Warehouses
0
N/A
0
N/A
Industrial Process Refrigeration
0
N/A
0
N/A
Stand-Alone Retail Food Refrigeration
197
20
201
20
Supermarket Systems
3,272
12,910
3,314
12,925
Road
401
1,512
397
1,532
Refrigerated Transport
Vintage
0
13
0
11
Modern Rail
3
10
3
10
81
-------
2028
2029
Sector
Equipment
Type
Initial
Charge
(MT)
Service
Demand
(MT)
Initial
Charge
(MT)
Service
Demand
(MT)
Intermodal
Containers
118
290
120
301
Marine
329
1,869
335
1,964
Automatic Commercial Ice Makers
384
114
354
109
Total
23,314
16,738
23,476
16,870
a Not Applicable (mandatory use of reclaimed
refrigerant not proposed for servicing the
subsector.
These reclaimed refrigerant needs are shown by species in Table B-2 through Table B-5, below. In 2029,
the required reclaimed refrigerants for initial charge and service in the subsectors specified are estimated
to be 19,418 MT HFC-32, 10,543 MT HFC-125, 6,438 HFC-134a, and 3,948 MT HFC-143a. In 2028, the
totals are estimated at 18,916 MT HFC-32, 10,702 MT HFC-125, 6,284 MT HFC-134a, and 4,150 MT
HFC-143a.
Table B-2. Initial Charge Demand of HFCs for Applicable Subsectors in 2028
Initial Charge (MT)
Sector
Equipment Type
HFC-32
HFC-125
HFC-134a
HFC-143a
Residential Unitary
AC
10,607
0
0
0
Small Commercial
1,232
270
0
0
Unitary AC
Residential
and Light
Large Commercial
Unitary AC
142
2
5
0
Commercial
AC
Window Units
4,105
1,722
0
0
Packaged terminal
AC/heat pumps
(PTAC/PTHP)
189
60
0
0
Ground-source heat
122
54
101
0
pumps (GSHP)
Cold Storage Warehouses
0
0
0
0
Industrial Process Refrigeration
0
0
0
0
Stand-Alone Retail Food
Refrigeration
26
27
144
0
Supermarket Systems
536
1,329
1,087
320
82
-------
Initial Charge (MT)
Sector
Equipment Type
HFC-32
HFC-125
HFC-134a
HFC-143a
Road
17
199
42
142
Vintage
0
0
0
0
Refrigerated
Modern Rail
0
1
2
1
Transport
Intennodal
24
Containers
z
Marine
4
136
45
143
Automatic Commercial Ice Makers
0
127
108
150
Total
16,985
3,949
1,621
759
Table B-3: Service Demand of HFCs for Applicable Sub sectors in 2028
Service Demand (MT)
Sector
Equipment Type
HFC-32
HFC-125
HFC-134a
HFC-143a
Stand-Alone Retail Food
16
0.3
Refrigeration
z
z
Supermarket Systems
1,884
5,297
3,874
1,855
Road
20
626
198
668
Vintage
0
0
13
0
Refrigerated
Modern Rail
0
2
5
3
Transport
Intennodal
Containers
2
14
267
7
Marine
24
774
258
813
Automatic Commercial Ice Makers
0
38
32
44
Total
1,931
6,753
4,663
3,391
Table B-4: Initial Charge Demand of HFCs for Applicable Subsectors in 2029
Initial Charge (MT)
Sector
Equipment Type
HFC-32
HFC-125
HFC-134a
HFC-143a
Residential
Residential Unitary
10,519
0
0
0
and Light
AC
Commercial
AC
Small Commercial
Unitary AC
1,430
159
0
0
83
-------
Initial Charge (MT)
Sector
Equipment Type
HFC-32
HFC-125
HFC-134a
HFC-143a
Large Commercial
Unitary AC
176
2
5
0
Window Units
4,322
1,621
0
0
Packaged terminal
AC/heat pumps
(PTAC/PTHP)
212
35
0
0
Ground-source heat
131
40
100
0
pumps (GSHP)
Cold Storage Warehouses
0
0
0
0
Industrial Process Refrigeration
0
0
0
0
Stand-Alone Retail Food
27
27
147
0
Refrigeration
Supermarket Systems
543
1,346
1,101
324
Road
22
213
37
126
Vintage
0
0
0
0
Refrigerated
Modern Rail
0
1
2
1
Transport
Intennodal
32
80
Containers
Z
Marine
4
139
46
146
Automatic Commercial Ice Makers
0
117
99
138
Total
17,392
3,732
1,616
737
Table B-5: Service Demand of HFCs for Applicable Subsectors in 2029
Service Demand (MT)
Sector
Equipment Type
HFC-32
HFC-125
HFC-134a
HFC-143a
Stand-Alone Retail Food
15
0.3
Refrigeration
z
z
Supermarket Systems
1,970
5,283
4,028
1,645
Road
26
652
195
658
Vintage
0
0
11
0
Refrigerated
Modern Rail
0
2
5
3
Transport
Intennodal
21
270
n
Containers
D
i
Marine
26
815
267
857
84
-------
Service Demand (MT)
Sector
Equipment Type
HFC-32
HFC-125
HFC-134a
HFC-143a
Automatic Commercial Ice Makers
0
36
30
42
Total
2,026
6,811
4,822
3,211
Potential Cost Savings from Reclamation
The proposed requirement to use reclaimed refrigerant would reduce the need for virgin production of
refrigerant, which some research indicates could result in cost-savings and benefits. Yasaka et al. (2023)
performed a life cycle assessment for the virgin production, destruction, and reclamation of R-41 OA,
HFC-32, and HCFC-22 in Europe and Japan and found that the reclamation process had lower energy
consumption and costs and emitted fewer greenhouse gas (GHG) emissions compared to production and
destruction, regardless of the refrigerant type or plant location. Although similar information specific to
the U.S. market were not available, below we use this study to estimate potential benefits associated with
the proposed requirement to use reclaimed refrigerant.
The Yasaka et al. (2023) study evaluates HCFC-22, HFC-32, HFC-125, HFC-134a, and R-410A and
chooses to summarize information on HFC-32 produced, destroyed or reclaimed in Japan. To be
conservative, we use these estimates and note that of the HFC/country pairs evaluated, this was the lowest
GHG emissions associated with virgin production. Overall costs associated with virgin production,
destruction, and reclamation per kilogram of refrigerant evaluated in Yasaka et al. (2023) are summarized
in Error! Reference source not found.. As shown, refrigerant reclamation could result in up to $0.58 in
savings per kilogram of refrigerant compared to destruction of recovered refrigerant and virgin production
to meet new demand.
Table B-6: Costs of Virgin Production, Destruction, and Reclamation ($ kg of refrigerant)12
$0.24
Incremental Cost Difference (Virgin Production
+ Destruction - Reclamation)
$0.58
Source: Yasaka et al. (2023).
a Estimated based on production, destruction, and reclamation of HFC-32 in Japan.
Yasaka et al. (2023) also estimated GHG emissions associated with virgin production, destruction, and
reclamation, shown in Error! Reference source not found.. As shown, refrigerant reclamation could
85
-------
result in up to 9.96 kg of C02-equivalent avoided per kilogram of refrigerant compared to destruction of
recovered refrigerant and virgin production to meet new demand.
Table B-7: GHG Emission Redactions Associated with Virgin Production, Destruction, and
Reclamation (kgC02eq kg of produced refrigerant)12
1.11
Incremental Emission Reductions (Virgin
Production + Destruction - Reclamation)
9.96
Source: Yasaka et al. (2023).
a Estimated based on production, destruction, and reclamation of HFC-32 in Japan.
To estimate potential costs and benefits of the proposed reclamation requirement, the incremental costs
and avoided GHG emissions were multiplied by estimated new demand and servicing in 2028 and 2029
in the Vintaging Model. The values above for the years 2028 and 2029 were extrapolated out to 2050 with
assumptions on growth and transition from the Vintaging Model. The amount of emissions prevented was
estimated by the reduction of demand for virgin HFCs, reduced by 15% to account for the maximum
virgin percentage of reclaim, then further reduced 67% to account for losses in reclaim processes and the
eventual emissions of reclaimed HFCs. As shown in Error! Reference source not found., the proposed
reclamation requirement could result in up to $267 million in climate benefits and $265 million in net
benefits 2028 to 2050, discounted to 2024.
Table B-8: Incremental Annual Cost Savings and GHG Emission Reductions Associated with
Reclamation (Thousands 2022$)
Year
Benefits
Costs
Net Benefits
2028
$15,000
$110
$14,890
2029
$15,500
$110
$15,390
2030
$15,900
$110
$15,790
2031
$15,700
$111
$15,589
2032
$15,700
$110
$15,590
2033
$15,000
$111
$14,889
2034
$15,000
$110
$14,890
2035
$15,000
$110
$14,890
2036
$15,000
$110
$14,890
86
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2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
d.r.
NPV
EAV
Benefits
Net Benefits
$15,000
$109
$14,891
$15,000
$109
$14,891
$15,100
$109
$14,991
$15,000
$109
$14,891
$15,300
$109
$15,491
$15,600
$109
$15,491
$16,000
$108
$15,892
$15,900
$108
$15,792
$16,000
$108
$15,892
$16,000
$108
$15,892
$16,000
$109
$15,891
$16,100
$109
$15,991
$16,000
$110
$15,890
$16,100
$111
$15,989
3%
3%
7%
3%
7%
$267,000
$1,838
$1,157
$265,000
$266,000
$14,508
$100
$91
$14,408
$14,417
87
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Appendix C. Cylinder Management
C.1. Introduction
Most HFCs, including those used as refrigerants, are gases at room temperature and are typically
transported and stored as compressed liquids in pressurized metal containers called cylinders. There are
two primary types of cylinders. Disposable (also known as non-refillable or single-use or DOT-39)
cylinders are used once before disposal, whereas refillable cylinders can be used multiple times
throughout the cylinder lifetime. Disposable cylinders today are typically discarded with refrigerants still
in the cylinders, including from amounts commonly referred to as heels (i.e., the small amount of
refrigerant that remains in an "empty" cylinder). These residual refrigerants are emitted overtime as they
leak out or are expelled when the cylinder is crushed for disposal or metal recycling. So-called "30-
pound" metal cylinders are most often disposable but may come in refillable designs as well and are used
primarily in the stationary air-conditioning and refrigeration system servicing industry and, to a lesser
extent, in motor vehicle air conditioning.
The provisions of this proposed rule include proposed requirements to recover the refrigerant from
disposable cylinders before the cylinders are discarded. The emission reductions from the proposed
requirements to recover the heels from disposable cylinders used for servicing, repair, disposal, or
installation of equipment are discussed below. Both disposable and refillable cylinders will be available
for transporting refrigerant; however, additional costs that may be borne through the management and
tracking of both disposable and refillable cylinders as proposed in this rule are included in this draft RIA
Addendum.
EPA has prepared a report, Refrigerant Cylinders: Analysis of Use, Disposal, and Distribution of
Refrigerants (EPA 2023), analyzing the costs and benefits of the proposed requirement that disposable
cylinders that have been used for the servicing, repair, or installation of refrigerant-containing equipment
be transported to an EPA-certified reclaimer, and that reclaimers remove all HFCs from disposable
cylinders prior to disposal. This Appendix presents a summary of the results from this report.
C.2. Emission Estimates for Recovery of Cylinder Heels
The report assesses the typical distribution of refrigerants in cylinders, including refrigerant changes
expected under the Allocation Framework Reference Case. Heels remaining in disposable cylinders were
determined through both a theoretical and empirical study. Based on the wide range of disposal practices
currently employed and expected to continue in absence of this proposed Rule, three scenarios were
developed to estimate the emissions avoided: a most likely scenario, a low scenario (i.e., a lower heel left
88
-------
in the cylinder), and a high scenario. Other emissions associated with cylinders—for example, during
transport and storage—are not expected to change based on this proposed Rule. Table C-l, below,
presents the avoided emissions for the years 2025 through 2050.
Table C- 1: Estimated Annual Emission Changes Compared with BA U, 2025-2050
Year
Average HFC
Emission Changes Relative to BAU (MMTCChe)
GWP
Most Likely
Low
High
2025
1,928
-3.74
-1.72
-5.63
2026
1,882
-3.65
-1.68
-5.50
2027
1,834
-3.56
-1.64
-5.36
2028
1,781
-3.46
-1.59
-5.20
2029
1,714
-3.33
-1.53
-5.01
2030
1,639
-3.18
-1.47
-4.79
2031
1,557
-3.02
-1.39
-4.55
2032
1,470
-2.85
-1.31
-4.29
2033
1,374
-2.67
-1.23
-4.01
2034
1,330
-2.58
-1.19
-3.89
2035
1,288
-2.50
-1.15
-3.76
2036
1,249
-2.43
-1.12
-3.65
2037
1,209
-2.35
-1.08
-3.53
2038
1,169
-2.27
-1.05
-3.41
2039
1,131
-2.19
-1.01
-3.30
2040
1,094
-2.12
-0.98
-3.19
2041
1,057
-2.05
-0.94
-3.09
2042
1,020
-1.98
-0.91
-2.98
2043
982
-1.91
-0.88
-2.87
2044
950
-1.84
-0.85
-2.78
2045
925
-1.80
-0.83
-2.70
2046
906
-1.76
-0.81
-2.65
2047
893
-1.73
-0.80
-2.61
2048
887
-1.72
-0.79
-2.59
2049
882
-1.71
-0.79
-2.58
2050
878
-1.71
-0.79
-2.57
Total
-64.11
-29.53
-96.46
C.3. Cost Estimates for Recovery of Cylinder Heels
The report also assesses the cost implications for the proposed requirement for heel recovery, accounting
for the costs associated with the change in procedure handling of cylinders (i.e., returning the cylinders to
be recovered) and the potential savings from avoided refrigerant loss from heel emissions, The analysis
assumes that 50 percent of the cylinders will be returned to a wholesaler, who will ship disposable
89
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cylinders to a reclaimer, and the other 50 percent will be sent directly to the reclaimer. Accounting for the
fuel and labor associated with the additional shipment of cylinders, the report estimates these costs and
benefits, and hence the net benefits, as shown in .
Table C- 2: Costs, Benefits, and Net Benefits of Cylinder Management (Millions 2022$)
Year
Benefits
Costs
Net Benefits
2025
$289
$0.4
$289
2026
$290
$0.4
$290
2027
$290
$0.4
$290
2028
$289
$0.4
$289
2029
$285
$0.4
$285
2030
$280
$0.5
$280
2031
$273
$0.5
$273
2032
$264
$0.5
$263
2033
$254
$0.5
$254
2034
$252
$0.5
$252
2035
$250
$0.5
$250
2036
$249
$0.5
$248
2037
$247
$0.5
$247
2038
$244
$0.5
$244
2039
$242
$0.5
$241
2040
$240
$0.6
$240
2041
$238
$0.6
$238
2042
$235
$0.6
$234
2043
$231
$0.6
$231
2044
$229
$0.6
$229
2045
$228
$0.6
$227
2046
$228
$0.6
$228
2047
$230
$0.6
$229
2048
$234
$0.6
$233
2049
$237
$0.7
$236
2050
$241
$0.7
$240
d.r.
3%
3%
7%
3%
7%
NPV
$4,463
$9.1
$5.6
$4,453
$4,457
EAV
$257
$0.5
$0.8
$257
$256
References:
U.S. Environmental Protection Agency (EPA). 2023. Refrigerant Cylinders: Analysis of Use, Disposal,
and Distribution of Refrigerants.
90
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Appendix D. Analysis of Provisions Impacting the Fire Suppression Sector
Background
As detailed in the rule preamble, the subsection (h) rule as proposed includes the following provisions
specifically covering the fire suppression equipment sector:
1. minimize release of HFCs,
2. require the use of recycled HFCs for initial charge, and
3. require the use of recycled HFCs for servicing/refilling equipment.
Based on estimates from EPA's Vintaging Model, annual demand for HFCs used in fire suppression
equipment ranged from approximately 2.8 to 3.7 MMTCChe from 2010 through 2020. The primary HFC
gases utilized in the fire suppression sector (including in total flooding systems and streaming
applications) include HFC-125 (GWP of 3,500), HFC-227ea (GWP of 3,220), and HFC-236fa (GWP of
9,810). To a lesser extent, HFC-23 (GWP of 14,800) is also used.
Potential Incremental Benefits
Avoiding the consumption and eventual release of these gases through provisions aimed at maximizing
the use of recycled as opposed to virgin HFCs and minimizing emissions over the course of equipment
lifetime could result in significant climate benefits. However, to avoid double counting and potential
overestimation of any benefits, this analysis considers the impact of the already-in-place policy and
requirements under the Allocation Framework Rule and 2024 Allocation Rule.
As described in the Allocation Framework Rule RIA and 2024 Allocation Rule RIA Addendum, EPA
previously modeled the costs and benefits of the Allocation Framework Rule through the use of the
Vintaging Model and a MACC methodology. The analysis demonstrated significant net benefits of the
Allocation Framework Rule and anticipated transitions away from HFCs across virtually all subsectors
that currently rely on these gases, including fire suppression equipment. As shown in Figure D-l below,
in the analysis EPA estimated that approximately two-thirds of the total flooding fire suppression
equipment sector would transition away from HFCs to alternatives over the 2025-2050 period. The
analysis did not assume any additional transition from the streaming fire suppression sector. The residual
demand for HFCs for fire suppression servicing and initial charge is also shown in Figure D-l.
91
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Figure D-l: Fire Suppression Avoided Consumption and Residual Demand under Allocation Framework
Rule Compliance Path
3.50
3.00
2.50
CD
O 2.00
O
^ 1.50
1.00
0.50
%> %%%
Total
Abatement
i Residual
demand
¦Fire
Suppresion
BAU
As shown in the figure above, while most of the total flooding sector was assumed to transition in order to
meet compliance with the HFC phasedown, approximately one-third of servicing and initial charge
demand was not previously assumed to transition away from HFCs. For the purposes of this analysis, we
assume that incremental benefits of this rule may be quantified using this residual demand for HFCs as a
starting point. Since this proposed rule would require that 100 percent of both the first charge and any
servicing/recharge for covered fire-suppression equipment would have to be met by recycled HFCs, a
high-end estimate of the incremental benefits of this rule can be quantified as the total residual demand
not previously assumed to transition, assuming that demand was met with virgin HFCs. This high-end
estimate, however, would assume that the additional reduction in HFC demand in the fire suppression
sector would not be offset by additional HFC consumption and production in other sectors representing a
far larger share of HFC demand. In other words, it would assume that consumption and/or production
allowances freed up by the fire suppression sector under the HFC Allocation trading system would not be
used.
Given this inherent uncertainty, EPA estimates that incremental benefits of the provisions of this
proposed rule would range from an average of 0.96 MMTCChe annually in avoided consumption (no
offsetting allowance activity), to 0 MMTCO2 annually (full offsetting allowance activity).
In addition to offsetting effects under the allowance trading system, EPA notes that a significant portion
of the fire suppression market already uses recycled HFCs to meet servicing and recharge demand.
92
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According a 2022 report from the Halon Alternatives Research Corporation (HARC), approximately 80%
of reported HFCs sold for the recharging of fire protection came from recyclers in 2020, and in recent
years this number has averaged approximately 75% 43 For this reason too, the above 0.96 MMTCChe
would likely be an overestimate of any incremental benefits of this rule over the baseline use of recycled
HFCs.
Potential incremental costs
At this time, EPA does not have evidence to suggest significant incremental costs associated with the
proposed provisions affecting the fire suppression sector. As mentioned above, a significant share of the
industry (as much as 80 percent) already reports the use of recycled HFCs to meet servicing demand and
the recharge of fire suppression equipment.
Costs of virgin HFCs may be rising vis-a-vis the cost of reclaimed HFCs, and already there is evidence
suggesting this dynamic. As noted in the preamble for this proposed rule, a recent report by the Montreal
Protocol's Technology and Economic Assessment Panel's (TEAP) Fire Suppression Technical Options
Committee (FSTOC) noted that the HFC phasedown in the United States is already having a large effect
on the market for HFCs used as fire extinguishants, citing that there has "already been significant impact
on cost of HFCs/'44 As noted in the report, the sector may already be seeing significant effects because it
relies on HFCs that are relatively high-GWP (thus requiring more consumption/production allowances
given that the allocation mechanism in the US is GWP-weighted), and has a relatively small market size
compared to other major sources of demand for HFCs. In addition, in a recent response to an EPA Notice
of Data Availability, HARC noted that under the AIM Act allowance system, the "price of virgin HFCs
for fire suppression has risen significantly to the point that recycled HFCs may now be lower in price than
virgin HFCs in some cases."45
Given the substantial use of recycled HFCs in the industry already, as well as the likelihood of increased
cost-effectiveness of recycled HFCs vis a vis virgin HFCs in the fire suppression sector, EPA does not at
this time anticipate significant incremental costs to industry resulting from these proposed provisions.
43 Halon Alternatives Research Corporation (HARC). "Report of the HFC Emissions Estimating Program (HEEP) 2002-2020
Data Collection. October 2022. Available online at:
https://www.harc.org/ files/ugd/4e7ddl 64188eee6f554bf5966fbd24f97b552a.pdf
44 UNEP, "TEAP 2022 Assessment: Report of the Fire Suppression Technical Options Committee," December 2022, available at:
https://ozone.unep.org/svstem/files/documents/FSTOC-2022-Assessment.pdf.
45 E1ARC. Comments submitted Re: Notice of Data Availability Relevant to Management of Regulated Substances Under the
American Innovation and Manufacturing Act of 2020; Docket ID No EPA-HQ-OAR-2022-0606, 87 Fed. Reg. 62843.
November 7,2022.
93
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Appendix E. Detailed Costs by Equipment - Leak Repair and Inspection
Table E-l: Total Annual Refrigerant Savings in 2030 (2022$) and Combined Annual Cost and
Annual Savings with 7% and 3% Discount Rate by Equipment Type
7% Discount Rate 3% Discount Rate
Annual Combined Combined
Sector
Equipment Type
Refrigerant
Savings
Incremental
Compliance
Costs
Annual Savings
and
Compliance
Costs
Incremental
Compliance
Costs
Annual
Savings and
Compliance
Costs
2030
2030
2030
2030
2030
Leak Repair
$13,916,300
$22,070,700
$8,154,400
$10,525,200
-$3,391,200
CC
School & Tour
Bus AC
Sub-Small
-$20,700
$2,377,900
$2,357,200
$1,129,500
$1,108,700
Transit Bus AC
Sub-Small
-$12,400
$842,400
$829,900
$400,100
$387,700
Train AC
Sub-Small
-$6,500
$131,500
$124,900
$62,500
$55,900
Chiller
Medium
-$3,832,800
$10,614,700
$6,781,900
$5,078,900
$1,246,100
Chiller
Large
-$133,500
$153,600
$20,100
$73,100
-$60,400
CR
Modern Rail
Transport
Sub-Small
-$4,900
$106,900
$102,000
$50,800
$45,900
Condensing
Unit
Sub-Small
-$195,400
$3,839,400
$3,643,900
$1,824,000
$1,628,600
Vintage Rail
Transport
Sub-Small
-$5,100
$39,900
$34,800
$19,000
$13,800
Rack
Medium
-$1,078,000
$788,100
-$289,900
$375,700
-$702,300
Rack
Large
-$1,243,800
$531,000
-$712,900
$250,000
-$993,900
Marine
Transport
Small
-$236,600
$314,300
$77,800
$149,500
-$87,100
Marine
Transport
Medium
-$1,224,700
$1,503,100
$278,400
$718,800
-$505,900
Marine
Transport
Large
-$48,200
$15,500
-$32,800
$7,300
-$41,000
Cold Storage
Large
-$139,200
$40,900
-$98,300
$19,400
-$119,800
IPR
IPR
Medium
-$158,300
$113,200
-$45,100
$54,200
-$104,100
IPR
Large
-$5,576,000
$658,500
-$4,917,500
$312,600
-$5,263,400
Leak Inspection
$0
$70,285,000
$70,285,000
$70,285,000
$70,285,000
CC
School & Tour
Bus AC
Sub-Small
$0
$7,797,800
$7,797,800
$7,797,800
$7,797,800
Transit Bus AC
Sub-Small
$0
$2,762,600
$2,762,600
$2,762,600
$2,762,600
Train AC
Sub-Small
$0
$428,300
$428,300
$428,300
$428,300
Chiller
Medium
$0
$13,782,800
$13,782,800
$13,782,800
$13,782,800
Chiller
Large
$0
$155,800
$155,800
$155,800
$155,800
94
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7% Discount Rate
3% Discount Rate
Annual
Combined
Combined
Sector
Equipment Type
Refrigerant
Incremental
Annual Savings
Incremental
Annual
Savings
Compliance
and
Compliance
Savings and
Costs
Compliance
Costs
Costs
Compliance
Costs
2030
2030
2030
2030
2030
Modern Rail
Transport
Sub-Small
$0
$701,200
$701,200
$701,200
$701,200
Condensing
Unit
Sub-Small
$0
$24,979,600
$24,979,600
$24,979,600
$24,979,600
Vintage Rail
Transport
Sub-Small
$0
$260,700
$260,700
$260,700
$260,700
Rack
Medium
$0
$4,506,300
$4,506,300
$4,506,300
$4,506,300
CR
Rack
Large
$0
$901,300
$901,300
$901,300
$901,300
Marine
Transport
Small
$0
$1,969,500
$1,969,500
$1,969,500
$1,969,500
Marine
Transport
Medium
$0
$9,983,100
$9,983,100
$9,983,100
$9,983,100
Marine
Transport
Large
$0
$27,100
$27,100
$27,100
$27,100
Cold Storage
Large
$0
$26,600
$26,600
$26,600
$26,600
IPR
IPR
Medium
$0
$1,135,600
$1,135,600
$1,135,600
$1,135,600
IPR
Large
$0
$866,700
$866,700
$866,700
$866,700
Automatic Leak Detection
$0
$109,787,000
$109,787,000
$109,787,000
$109,787,000
School & Tour
Bus AC
Sub-Small
$0
$0
$0
$0
$0
CC
Transit Bus AC
Sub-Small
$0
$0
$0
$0
$0
Train AC
Sub-Small
$0
$0
$0
$0
$0
Chiller
Medium
$0
$0
$0
$0
$0
Chiller
Large
$0
$0
$0
$0
$0
Modern Rail
Transport
Sub-Small
$0
$0
$0
$0
$0
Condensing
Unit
Sub-Small
$0
$0
$0
$0
$0
Vintage Rail
Transport
Sub-Small
$0
$0
$0
$0
$0
Rack
Medium
$0
$43,970,000
$43,970,500
$43,970,000
$43,970,500
CR
Rack
Large
$0
$45,460,000
$45,460,300
$45,460,000
$45,460,300
Marine
Transport
Small
$0
$0
$0
$0
$0
Marine
Transport
Medium
$0
$400,000
$400,300
$400,000
$400,300
Marine
Transport
Large
$0
$414,000
$414,400
$414,000
$414,400
Cold Storage
Large
$0
$582,000
$581,900
$582,000
$581,900
IPR
IPR
Medium
$0
$0
$0
$0
$0
IPR
Large
$0
$18,960,000
$18,960,000
$18,960,000
$18,960,000
Reporting & Recordkeeping
$0
$13,341,300
$13,341,300
$13,341,300
$13,341,300
CC,
CR,
CC and CR
15-50 lb.a
15-50
$0
$6,827,500
$6,827,500
$9,763,400
$9,763,400
95
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7% Discount Rate
3% Discount Rate
Sector
Equipment Type
Annual
Refrigerant
Savings
Incremental
Compliance
Costs
Combined
Annual Savings
and
Compliance
Costs
Incremental
Compliance
Costs
Combined
Annual
Savings and
Compliance
Costs
2030
2030
2030
2030
2030
and
IPR
CC. CR, and
IPR >50 lb.
$0
$6,513,900
$6,513,900
$3,987,900
$3,987,900
Total
$13,916,300
$215,480,000
$199,211,000
$203,940,000
$188,914,000
Totals may not sum due to independent rounding.
Table E-2: Total Annual Refrigerant Savings in 2040 (2022$) and Combined Annual Cost and
Annual Savings with 7% and 3% Discount Rate by Equipment Type
7% Discount Rate
3% Discount Rate
Sector
Equipment Typ
e
Annual
Refrigerant
Savings
Incremental
Compliance
Costs
Combined
Annual Savings
and
Compliance
Costs
Incremental
Compliance
Costs
Combined
Annual
Savings and
Compliance
Costs
2040
2040
2040
2040
2040
Leak Repair
$12,218,500
$23,869,900
$11,651,400
$11,384,800
-$833,700
School & Tour
Bus AC
Sub-Small
-$23,600
$2,705,800
$2,682,200
$1,285,200
$1,261,600
CC
Transit Bus AC
Sub-Small
-$14,100
$958,500
$944,400
$455,300
$441,100
Train AC
Sub-Small
-$7,200
$144,100
$136,900
$68,400
$61,300
Chiller
Medium
-$4,322,700
$11,641,500
$7,318,800
$5,570,500
$1,247,800
Chiller
Large
-$156,600
$179,800
$23,200
$85,600
-$71,100
Modern Rail
Transport
Sub-Small
-$5,200
$114,400
$109,200
$54,300
$49,100
Condensing
Unit
Sub-Small
-$200,100
$3,930,900
$3,730,800
$1,867,500
$1,667,400
Vintage Rail
Transport
Sub-Small
$0
$0
$0
$0
$0
Rack
Medium
-$1,203,800
$880,100
-$323,800
$419,500
-$784,300
CR
Rack
Large
-$1,389,000
$592,900
-$796,100
$279,100
-$1,109,900
Marine
Transport
Small
-$301,100
$400,000
$99,000
$190,300
-$110,800
Marine
Transport
Medium
-$1,558,000
$1,912,600
$354,600
$914,600
-$643,400
Marine
Transport
Large
-$60,700
$19,500
-$41,300
$9,200
-$51,600
Cold Storage
Large
-$53,600
$17,000
-$36,600
$8,100
-$45,500
IPR
IPR
Medium
-$70,800
$50,600
-$20,200
$24,200
-$46,500
IPR
Large
-$2,852,000
$322,300
-$2,529,700
$153,100
-$2,698,900
Leak Inspection
$0
$76,292,600
$76,292,600
$76,292,600
$76,292,600
96
-------
7% Discount Rate
3% Discount Rate
Sector
Equipment Typ
e
Annual
Refrigerant
Savings
Incremental
Compliance
Costs
Combined
Annual Savings
and
Compliance
Costs
Incremental
Compliance
Costs
Combined
Annual
Savings and
Compliance
Costs
2040
2040
2040
2040
2040
School & Tour
Bus AC
Sub-Small
$0
$8,872,800
$8,872,800
$8,872,800
$8,872,800
CC
Transit Bus AC
Sub-Small
$0
$3,143,500
$3,143,500
$3,143,500
$3,143,500
Train AC
Sub-Small
$0
$469,400
$469,400
$469,400
$469,400
Chiller
Medium
$0
$15,085,300
$15,085,300
$15,085,300
$15,085,300
Chiller
Large
$0
$182,300
$182,300
$182,300
$182,300
Modern Rail
Transport
Sub-Small
$0
$750,400
$750,400
$750,400
$750,400
Condensing
Unit
Sub-Small
$0
$25,575,000
$25,575,000
$25,575,000
$25,575,000
Vintage Rail
Transport
Sub-Small
$0
$0
$0
$0
$0
Rack
Medium
$0
$5,032,300
$5,032,300
$5,032,300
$5,032,300
CR
Rack
Large
$0
$1,006,500
$1,006,500
$1,006,500
$1,006,500
Marine
Transport
Small
$0
$2,506,400
$2,506,400
$2,506,400
$2,506,400
Marine
Transport
Medium
$0
$12,702,900
$12,702,900
$12,702,900
$12,702,900
Marine
Transport
Large
$0
$34,200
$34,200
$34,200
$34,200
Cold Storage
Large
$0
$11,200
$11,200
$11,200
$11,200
IPR
IPR
Medium
$0
$507,700
$507,700
$507,700
$507,700
IPR
Large
$0
$412,700
$412,700
$412,700
$412,700
Automatic Leak Detection
$0
$108,810,000
$108,810,000
$108,810,000
$108,810,000
School & Tour
Bus
Sub-Small
$0
$0
$0
$0
$0
CC
Transit Bus AC
Sub-Small
$0
$0
$0
$0
$0
Train AC
Sub-Small
$0
$0
$0
$0
$0
Chiller
Medium
$0
$0
$0
$0
$0
Chiller
Large
$0
$0
$0
$0
$0
Modern Rail
Transport
Sub-Small
$0
$0
$0
$0
$0
Condensing
Unit
Sub-Small
$0
$0
$0
$0
$0
Vintage Rail
Transport
Sub-Small
$0
$0
$0
$0
$0
Rack
Medium
$0
$48,465,000
$48,465,100
$48,465,000
$48,465,100
CR
Rack
Large
$0
$50,120,000
$50,120,200
$50,120,000
$50,120,200
Marine
Transport
Small
$0
$0
$0
$0
$0
Marine
Transport
Medium
$0
$467,000
$467,500
$467,000
$467,500
Marine
Transport
Large
$0
$484,000
$484,400
$484,000
$484,400
Cold Storage
Large
$0
$245,000
$245,200
$245,000
$245,200
97
-------
7% Discount Rate
3% Discount Rate
Sector
Equipment Typ
e
Annual
Refrigerant
Savings
Incremental
Compliance
Costs
Combined
Annual Savings
and
Compliance
Costs
Incremental
Compliance
Costs
Combined
Annual
Savings and
Compliance
Costs
2040
2040
2040
2040
2040
IPR
IPR
Medium
$0
$0
$0
$0
$0
IPR
Large
$0
$9,028,000
$9,027,900
$9,028,000
$9,027,900
Reporting & Recordkeeping
$0
$14,509,300
$14,509,300
$14,509,300
$14,509,300
CC.
CR,
CC and CR
15-50 lb.a
15-50
$0
$7,308,800
$7,308,800
$10,626,700
$10,626,700
and
IPR
CC, CR, and
IPR >50 lb.
50+
$0
$7,200,600
$7,200,600
$4,408,400
$4,408,400
Total
$12,218,500
$223,480,000
$208,581,000
$211,000,000
$197,517,000
Totals may not sum due to independent rounding.
Table E-3: Total Annual Refrigerant Savings in 2050 (2022$) and Combined Annual Cost and
Annual Savings with 7% and 3% Discount Rate by Equipment Type
7% Discount Rate
3% Discount Rate
Sector
Equipment Typ
e
Annual
Refrigerant
Savings
Incremental
Compliance
Costs
Combined
Annual Savings
and
Compliance
Costs
Incremental
Compliance
Costs
Combined
Annual
Savings and
Compliance
Costs
2050
2050
2050
2050
2050
Leak Repair
$10,165,400
$25,661,100
$15,495,800
$12,239,700
$2,074,400
School & Tour
Bus AC
Sub-Small
-$25,600
$2,931,300
$2,905,700
$1,392,300
$1,366,700
CC
Transit Bus AC
Sub-Small
-$15,300
$1,038,400
$1,023,100
$493,200
$477,900
Train AC
Sub-Small
-$7,800
$156,000
$148,300
$74,100
$66,400
Chiller
Medium
-$4,725,400
$12,638,000
$7,912,700
$6,047,400
$1,322,000
Chiller
Large
-$175,000
$200,800
$25,800
$95,600
-$79,500
Modern Rail
Transport
Sub-Small
-$5,700
$123,900
$118,300
$58,900
$53,200
Condensing
Unit
Sub-Small
-$220,700
$4,336,700
$4,116,000
$2,060,300
$1,839,600
Vintage Rail
Transport
Sub-Small
$0
$0
$0
$0
$0
CR
Rack
Medium
-$1,313,100
$960,000
-$353,200
$457,600
-$855,500
Rack
Large
-$1,515,200
$646,800
-$868,400
$304,500
-$1,210,700
Marine
Transport
Small
-$339,700
$451,300
$111,600
$214,600
-$125,000
Marine
Transport
Medium
-$1,755,700
$2,156,600
$400,900
$1,031,300
-$724,400
Marine
Transport
Large
-$66,200
$21,200
-$45,000
$10,000
-$56,300
98
-------
7% Discount Rate
3% Discount Rate
Sector
Equipment Typ
e
Annual
Refrigerant
Savings
Incremental
Compliance
Costs
Combined
Annual Savings
and
Compliance
Costs
Incremental
Compliance
Costs
Combined
Annual
Savings and
Compliance
Costs
2050
2050
2050
2050
2050
Cold Storage
Large
$0
$0
$0
$0
$0
IPR
IPR
Medium
$0
$0
$0
$0
$0
IPR
Large
$0
$0
$0
$0
$0
Leak Inspection
$0
$82,902,800
$82,902,800
$82,902,800
$82,902,800
School & Tour
Bus AC
Sub-Small
$0
$9,612,300
$9,612,300
$9,612,300
$9,612,300
CC
Transit Bus AC
Sub-Small
$0
$3,405,500
$3,405,500
$3,405,500
$3,405,500
Train AC
Sub-Small
$0
$508,300
$508,300
$508,300
$508,300
Chiller
Medium
$0
$16,368,200
$16,368,200
$16,368,200
$16,368,200
Chiller
Large
$0
$203,600
$203,600
$203,600
$203,600
Modern Rail
Transport
Sub-Small
$0
$812,700
$812,700
$812,700
$812,700
Condensing
Unit
Sub-Small
$0
$28,215,500
$28,215,500
$28,215,500
$28,215,500
Vintage Rail
Transport
Sub-Small
$0
$0
$0
$0
$0
Rack
Medium
$0
$5,489,300
$5,489,300
$5,489,300
$5,489,300
CR
Rack
Large
$0
$1,097,900
$1,097,900
$1,097,900
$1,097,900
Marine
Transport
Small
$0
$2,827,700
$2,827,700
$2,827,700
$2,827,700
Marine
Transport
Medium
$0
$14,324,500
$14,324,500
$14,324,500
$14,324,500
Marine
Transport
Large
$0
$37,300
$37,300
$37,300
$37,300
Cold Storage
Large
$0
$0
$0
$0
$0
IPR
IPR
Medium
$0
$0
$0
$0
$0
IPR
Large
$0
$0
$0
$0
$0
Automatic Leak Detection
$0
$108,135,000
$108,135,000
$108,135,000
$108,135,000
School & Tour
AC
Sub-Small
$0
$0
$0
$0
$0
CC
Transit Bus AC
Sub-Small
$0
$0
$0
$0
$0
Train AC
Sub-Small
$0
$0
$0
$0
$0
Chiller
Medium
$0
$0
$0
$0
$0
Chiller
Large
$0
$0
$0
$0
$0
Modern Rail
Transport
Sub-Small
$0
$0
$0
$0
$0
Condensing
Unit
Sub-Small
$0
$0
$0
$0
$0
CR
Vintage Rail
Transport
Sub-Small
$0
$0
$0
$0
$0
Rack
Medium
$0
$52,650,000
$52,650,000
$52,650,000
$52,650,000
Rack
Large
$0
$54,451,000
$54,450,600
$54,451,000
$54,450,600
Marine
Transport
Small
$0
$0
$0
$0
$0
99
-------
7% Discount Rate
3% Discount Rate
Sector
Equipment Typ
e
Annual
Refrigerant
Savings
Incremental
Compliance
Costs
Combined
Annual Savings
and
Compliance
Costs
Incremental
Compliance
Costs
Combined
Annual
Savings and
Compliance
Costs
2050
2050
2050
2050
2050
Marine
Transport
Medium
$0
$508,000
$508,100
$508,000
$508,100
Marine
Transport
Large
$0
$526,000
$526,500
$526,000
$526,500
Cold Storage
Large
$0
$0
$0
$0
$0
IPR
IPR
Medium
$0
$0
$0
$0
$0
IPR
Large
$0
$0
$0
$0
$0
Reporting & Recordkeeping
$0
$15,761,200
$15,761,200
$15,761,200
$15,761,200
CC.
CR,
CC and CR 15-
50 lbs.a
15-50
$0
$7,990,300
$7,990,300
$7,990,300
$7,990,300
and
IPR
CC, CR, and
IPR >50 lbs.
50+
$0
$7,770,800
$7,770,800
$7,770,800
$7,770,800
Total
$10,165,400
$232,460,000
$219,389,000
$219,040,000
$207,507,000
Totals may not sum due to independent rounding.
100
-------
Appendix F. Evaluation of Alternative Charge Size Thresholds
To provide a full range of costs, savings, and benefits estimates, Error! Reference source not found,
and Error! Reference source not found, show the compliance costs, savings, and benefits in 2025 and
2035 and Error! Reference source not found, shows the emission reduction benefits in 2030, 2040, and
2050 associated with an alternative policy scenario considering a 5-pound threshold for annual leak repair
and inspection of CC, CR, and IPR, rather than 15 pounds. This threshold was analyzed because of the
significant number of appliances exceeding the leak rate threshold within this equipment size category.
Affected equipment between 5 and 15 pounds was estimated based on the leak rate distribution approach
discussed in Appendix A and assumes that HFC appliances begin transitioning away from HFCs in
accordance with the transition scenario presented in the RIA for the AIM Act 2024 HFC Allocation Rule.
Table F-l: 2025 Total Annual Refrigerant Savings (2022$) and Combined Annual Cost and
Annual Savings with 7% and 3% Discount Rate and Benefits for Equipment 5-50 pounds
Rule Component
Annual
Refrigeran
t Savings
Incremental
Compliance
Costs
Combined
Annual
Savings and
Compliance
Costs
Incremental
Compliance
Costs
Combined
Annual
Savings and
Compliance
Costs
GHG
Emissions
Avoided
(MTCCfceq
)
7% Discount Rate
3% Discount Rate
Leak Repair
$1,384,000
$70,240,000
$68,856,000
$33,362,000
$31,978,000
479,000
School & Tour Bus AC (15-30 lbs.)
-$38,000
$4,334,000
$4,296,000
$2,059,000
$2,021,000
6,000
School & Tour Bus AC (10-15 lbs.)
-$50,000
$8,656,000
$8,606,000
$4,111,000
$4,061,000
8,000
Transit Bus AC (15-30 lbs.)
-$11,000
$768,000
$757,000
$365,000
$354,000
2,000
Passenger Train AC (30-50 lbs.)
-$6,000
$119,000
$113,000
$56,000
$50,000
1,000
Road Transport (5-10 lbs.)
-$790,000
$25,797,000
$25,007,000
$12,252,000
$11,462,000
323,000
Intermodal Containers (5-10 lbs.)
-$85,000
$5,549,000
$5,464,000
$2,636,000
$2,551,000
15,000
Condensing Units (5-10 lbs.)
-$138,000
$10,620,000
$10,482,000
$5,044,000
$4,906,000
35,000
Modern Rail Transport AC (15-30 lbs.)
-$5,000
$104,000
$99,000
$50,000
$45,000
1,000
Condensing Units (30-50 lbs.)
-$180,000
$3,538,000
$3,358,000
$1,681,000
$1,501,000
61,000
Vintage Rail Transport (30-50 lbs.)
-$14,000
$105,000
$91,000
$50,000
$36,000
2,000
Ice Makers (5-10 lbs.)
-$67,000
$10,650,000
$10,583,000
$5,058,000
$4,991,000
25,000
Leak Repair Total (5-10 lbs.)
$1,080,000
$52,616,000
$51,536,000
$24,990,000
$23,910,000
$398,000
Leak Repair Total (10-15 lbs.)
-$50,000
$8,656,000
$8,606,000
$4,111,000
$4,061,000
$8,000
Leak Repair Total (15-30 lbs.)
-$54,000
$5,206,000
$5,152,000
$2,474,000
$2,420,000
$9,000
Leak Repair Total (30-50 lbs.)
-$200,000
$3,762,000
$3,562,000
$1,787,000
$1,587,000
$64,000
101
-------
Rule Component
Annual
Refrigeran
t Savings
Incremental
Compliance
Costs
Combined
Annual
Savings and
Compliance
Costs
Incremental
Compliance
Costs
Combined
Annual
Savings and
Compliance
Costs
GHG
Emissions
Avoided
(MTCCfceq
)
7% Discount Rate
3% Discount Rate
Leak Inspection
$394,438,000
$394,438,000
$394,438,000
$394,438,000
School & Tour Bus AC (15-30 lbs.)
$7,107,000
$7,107,000
$7,107,000
$7,107,000
School & Tour Bus AC (10-15 lbs.)
$14,213,000
$14,213,000
$14,213,000
$14,213,000
Transit Bus AC (15-30 lbs.)
$2,518,000
$2,518,000
$2,518,000
$2,518,000
Passenger Train AC (30-50 lbs.)
$387,000
$387,000
$387,000
$387,000
Road Transport (5-10 lbs.)
$169,475,000
$169,475,000
$169,475,000
$169,475,000
Intermodal Containers (5-10 lbs.)
$36,455,000
$36,455,000
$36,455,000
$36,455,000
Condensing Units (5-10 lbs.)
$69,845,000
$69,845,000
$69,845,000
$69,845,000
Modern Rail Transport AC (15-30 lbs.)
$684,000
$684,000
$684,000
$684,000
Condensing Units (30-50 lbs.)
$23,022,000
$23,022,000
$23,022,000
$23,022,000
Vintage Rail Transport (30-50 lbs.)
$686,000
$686,000
$686,000
$686,000
Ice Makers (5-10 lbs.)
$70,046,000
$70,046,000
$70,046,000
$70,046,000
Leak Inspection Total (5-10 lbs.)
$345,821,000
$345,821,000
$345,821,000
$345,821,000
Leak Inspection Total (10-15 lbs.)
$14,213,000
$14,213,000
$14,213,000
$14,213,000
Leak Inspection Total (15-30 lbs.)
$10,309,000
$10,309,000
$10,309,000
$10,309,000
Leak Inspection Total (30-50 lbs.)
$24,095,000
$24,095,000
$24,095,000
$24,095,000
Reporting & Recordkeeping
$55,899,000
$55,899,000
$55,899,000
$55,899,000
Reporting & Recordkeeping (5-15 lbs.)
$49,571,000
49,571,000
$49,571,000
49,571,000
Reporting & Recordkeeping (15-50
lbs.)
$6,328,000
6,328,000
$6,328,000
6,328,000
Total
$1,384,000
$520,577,000
$519,193,000
$483,699,000
$482,315,000
479,000
Note: Values may not sum due to independent rounding
102
-------
Table F-2: 2025 Monetized Climate Benefits and Net Benefits with 7% and 3% Discount Rate for
Equipment 5-50 pounds
Rule Component
GHG
Emissions
Avoided
(MTCCheq
Climate
Benefits
(3%
discount
Combined
Annual
Savings and
Compliance
Costs
Net Benefits
Combined
Annual
Savings and
Compliance
Costs
Net Benefits
)
rate)
7% Discount
Rate
7% Discount
Rate
3% Discount
Rate
3% Discount
Rate
Leak Repair Total (5-10 lbs.)
415,000
$27,896,00
0
$60,526,000
-$32,630,000
$28,137,000
-$241,000
Leak Repair Total (10-15 lbs.)
71,000
$5,113,000
$54,511,000
-$49,398,000
$25,725,000
-$20,612,000
Leak Repair Total (15-30 lbs.)
8,000
$786,000
$2,231,000
-$1,445,000
$1,041,000
-$255,000
Leak Repair Total (30-50 lbs.)
64,000
$6,798,000
$3,562,000
$3,236,000
$1,587,000
$5,211,000
Leak Repair Total (5-50 lbs.)
558,000
$40,593,00
0
$120,830,000
-$80,237,000
$56,490,000
-$15,897,000
Note: Values may not sum due to independent rounding
Table F-3: 2035 Total Annual Refi'igerant Savings (2022$) and Combined Annual Cost and
Annual Savings with 7% and 3% Discount Rate and Benefits for Equipment 5-50 pounds
Rule Component
Annual
Refrigeran
t Savings
Incremental
Compliance
Costs
Combined
Annual
Savings and
Compliance
Costs
Incremental
Compliance
Costs
Combined
Annual
Savings and
Compliance
Costs
GHG
Emissions
Avoided
(MTCCfceq
)
7% Discount Rate
3% Discount Rate
Leak Repair
$1,629,000
$79,570,000
$77,941,000
$37,791,000
$36,162,000
483,000
School & Tour Bus AC (15-30 lbs.)
-$45,000
$5,136,000
$5,091,000
$2,439,000
$2,394,000
7,000
School & Tour Bus AC (10-15 lbs.)
-$60,000
$10,257,000
$10,197,000
$4,872,000
$4,812,000
10,000
Transit Bus AC (15-30 lbs.)
-$13,000
$910,000
$897,000
$432,000
$419,000
2,000
Passenger Train AC (30-50 lbs.)
-$7,000
$138,000
$131,000
$66,000
$59,000
1,000
Road Transport (5-10 lbs.)
-$983,000
$32,096,000
$31,113,000
$15,244,000
$14,261,000
346,000
Intermodal Containers (5-10 lbs.)
-$129,000
$8,400,000
$8,271,000
$3,989,000
$3,860,000
25,000
Condensing Units (5-10 lbs.)
-$152,000
$11,718,000
$11,566,000
$5,565,000
$5,413,000
30,000
Modern Rail Transport AC (15-30 lbs.)
-$5,000
$110,000
$105,000
$52,000
$47,000
2,000
Condensing Units (30-50 lbs.)
-$191,000
$3,749,000
$3,558,000
$1,781,000
$1,590,000
44,000
Vintage Rail Transport (30-50 lbs.)
$0
$0
$0
$0
$0
-
Ice Makers (5-10 lbs.)
-$44,000
$7,056,000
$7,012,000
$3,351,000
$3,307,000
16,000
103
-------
Rule Component
Annual
Refrigeran
t Savings
Incremental
Compliance
Costs
Combined
Annual
Savings and
Compliance
Costs
Incremental
Compliance
Costs
Combined
Annual
Savings and
Compliance
Costs
GHG
Emissions
Avoided
(MTCCfceq
)
7% Discount Rate
3% Discount Rate
Leak Repair Total (5-10 lbs.)
$1,308,000
$59,270,000
$57,962,000
$28,149,000
$26,841,000
$417,000
Leak Repair Total (10-15 lbs.)
-$60,000
$10,257,000
$10,197,000
$4,872,000
$4,812,000
$10,000
Leak Repair Total (15-30 lbs.)
-$63,000
$6,156,000
$6,093,000
$2,923,000
$2,860,000
$11,000
Leak Repair Total (30-50 lbs.)
-$198,000
$3,887,000
$3,689,000
$1,847,000
$1,649,000
$45,000
Leak Inspection
$443,321,000
$443,321,000
$443,321,000
$443,321,000
School & Tour Bus AC (15-30 lbs.)
$8,421,000
$8,421,000
$8,421,000
$8,421,000
School & Tour Bus AC (10-15 lbs.)
$16,842,000
$16,842,000
$16,842,000
$16,842,000
Transit Bus AC (15-30 lbs.)
$2,983,000
$2,983,000
$2,983,000
$2,983,000
Passenger Train AC (30-50 lbs.)
$451,000
$451,000
$451,000
$451,000
Road Transport (5-10 lbs.)
$210,853,000
$210,853,000
$210,853,000
$210,853,000
Intermodal Containers (5-10 lbs.)
$55,181,000
$55,181,000
$55,181,000
$55,181,000
Condensing Units (5-10 lbs.)
$77,069,000
$77,069,000
$77,069,000
$77,069,000
Modern Rail Transport AC (15-30 lbs.)
$723,000
$723,000
$723,000
$723,000
Condensing Units (30-50 lbs.)
$24,390,000
$24,390,000
$24,390,000
$24,390,000
Vintage Rail Transport (30-50 lbs.)
$0
$0
$0
$0
Ice Makers (5-10 lbs.)
$46,408,000
$46,408,000
$46,408,000
$46,408,000
Leak Inspection Total (5-10 lbs.)
$389,511,000
$389,511,000
$389,511,000
$389,511,000
Leak Inspection Total (10-15 lbs.)
$16,842,000
$16,842,000
$16,842,000
$16,842,000
Leak Inspection Total (15-30 lb.)
$12,127,000
$12,127,000
$12,127,000
$12,127,000
Leak Inspection Total (30-50 lb.)
$24,841,000
$24,841,000
$24,841,000
$24,841,000
Reporting & Recordkeeping
$63,586,000
$63,586,000
$63,586,000
$63,586,000
Reporting & Recordkeeping (5-15 lbs.)
$56,630,000
56,630,000
$56,630,000
56,630,000
Reporting & Recordkeeping (15-50 lbs.)
$6,956,000
6,956,000
$6,956,000
6,956,000
Total
$1,629,000
$586,477,000
$584,848,000
$544,698,000
$543,069,000
483,000
Note: Values may not sum due to independent rounding
104
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Table F-4: Annual GHG Emissions Avoided in 2030, 2040, and 2050for Equipment 5-50
pounds
Rule Component
GHG Emissions Avoided (MTCChcq)
2030
2040
2050
Leak Repair and Inspection
495,500
487,000
529,000
School & Tour Bus AC (15-30 lbs.)
7,000
8,000
8,000
School & Tour Bus AC (10-15 lbs.)
9,000
10,000
11,000
Transit Bus AC (15-30 lbs.)
2,000
2,000
2,000
Passenger Train AC (30-50 lbs.)
1,000
1,000
1,000
Road Transport (5-10 lbs.)
343,000
344,000
371,000
Intermodal Containers (5-10 lbs.)
19,000
29,000
33,000
Condensing Units (5-10 lbs.)
34,000
31,000
34,000
Modern Rail Transport AC (15-30 lbs.)
1,500
2,000
2,000
Condensing Units (30-50 lbs.)
57,000
44,000
49,000
Vintage Rail Transport (30-50 lbs.)
1,000
_
_
Ice Makers (5-10 lbs.)
21,000
16,000
18,000
Total (5-10 lbs.)
417,000
420,000
456,000
Total (10-15 lbs.)
9,000
10,000
11,000
Total (15-30 lbs.)
10,500
12,000
12,000
Total (30-50 lbs.)
59,000
45,000
50,000
105
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Appendix G. Evaluation of Alternative ALD Charge Size Thresholds
This section provides costs, savings, and benefits estimates associated with an alternative policy scenario
considering a 500-pound threshold for ALD systems in CR and IPR equipment, rather than 1,500 pounds.
This threshold was analyzed because of the significant number of appliances exceeding the leak rate
threshold within this equipment size category. All other assumptions are consistent with those discussed
in Section Error! Reference source not found..
Error! Reference source not found, summarizes the unit cost assumptions for direct and indirect ALD
equipment assuming a 500-pound threshold.
Table G-l: Unit Cost Assumptions for ALD Equipment for 500-pound Threshold
System Size
Material
Cost
Labor
Hours
Installation
Cost
Equipment
and
Installation
Cost
Annualized
Equipment and
Installation Cost
(Years 1-5)
Annual
O&M
Cost
Direct ALD System
500-1,500
$7,500
12
$662
$8,160
$2,142
$950
1,500-2,000
$9,000
16
$883
$9,880
$2,594
$1,250
2,000+
$9,850
20
$1,104
$10,950
$2,875
$1,440
| Indirect ALD System |
500-1,500
$1,600
6
$330
$1,930
NA
$775
1,500-2,000
$2,850
8
$440
$3,290
NA
$950
2,000+
$2,650
10
$550
$3,200
NA
$1,000
Error! Reference source not found, summarizes compliance costs for each equipment sector
and type category associated with a 500-pound ALD threshold for CR and IPR equipment.
-------
Table G-2: Aggregate Compliance Costs by Sector, Equipment Type, and Size for 500-pound
ALD Threshold9
Sector
Equipment
Type
Equipme
nt Size
2025
2030
2040
2050
School & Tour
Bus AC
Sub-small
$8,117,200
$8,906,500
$10,134,400
$10,979,000
Transit Bus AC
Sub-small
$2,871,100
$3,150,300
$3,584,600
$3,883,400
CC
Passenger Train
AC
Sub-small
$437,900
$484,200
$530,700
$574,700
Chiller
Medium
$12,447,500
$15,028,900
$16,333,100
$17,690,200
Large
$86,800
$95,400
$111,200
$124,100
Modern Rail
Transport
Sub-small
$728,700
$747,100
$799,500
$865,900
Vintage Rail
Transport
Sub-small
$722,700
$274,500
$0
$0
Condensing
Unit
Sub-small
$24,522,400
$26,608,200
$27,242,400
$30,055,100
CR
Marine
Transport
Small
$1,460,400
$1,882,400
$2,395,600
$2,702,700
Medium
$25,851,900
$22,378,300
$26,730,000
$29,622,700
Large
$508,900
$400,500
$467,000
$507,500
Rack
Medium
$113,877,300
$81,787,000
$90,174,500
$97,966,500
Large
$63,506,400
$45,367,700
$50,016,800
$54,337,800
Cold Storage
Large
$2,208,200
$488,700
$210,900
$0
IPR
IPR
Medium
$20,460,000
$5,069,000
$2,266,100
$0
Large
$71,241,900
$14,563,300
$6,741,700
$0
Reporting and Recordkeeping
$11,503,900
$13,002,700
$14,135,000
$15,357,100
a Costs are displayed using a 3 percent discount rate.
Total incremental compliance costs associated with the 500-pound ALD threshold scenario are
approximately $5.1 billion based on a 3 percent discount rate, discounted back to 2024, as shown in
Error! Reference source not found..
107
-------
Table G-3: Incremental Annual Compliance Costs (2022$) for 500-pound ALD Threshold
Scenario
Year
Total Incremental
Compliance Costs
(3% Discount Rate)
Refrigerant
Savings
Total Incremental Compliance Costs Minus
Refrigerant Savings
(3% Discount Rate)
2025
$374,000,000
$13,800,000
$361,000,000
2026
$295,000,000
$14,000,000
$281,000,000
2027
$311,000,000
$14,300,000
$297,000,000
2028
$330,000,000
$14,500,000
$315,000,000
2029
$343,000,000
$14,600,000
$328,000,000
2030
$255,000,000
$14,700,000
$240,000,000
2031
$257,000,000
$14,700,000
$242,000,000
2032
$258,000,000
$14,800,000
$243,000,000
2033
$260,000,000
$14,800,000
$245,000,000
2034
$261,000,000
$14,700,000
$246,000,000
2035
$261,000,000
$14,500,000
$247,000,000
2036
$262,000,000
$14,200,000
$247,000,000
2037
$263,000,000
$13,900,000
$249,000,000
2038
$263,000,000
$13,700,000
$250,000,000
2039
$264,000,000
$13,400,000
$251,000,000
2040
$265,000,000
$13,100,000
$252,000,000
2041
$266,000,000
$12,700,000
$253,000,000
2042
$266,000,000
$12,400,000
$254,000,000
2043
$267,000,000
$12,100,000
$255,000,000
2044
$267,000,000
$11,700,000
$255,000,000
2045
$268,000,000
$11,400,000
$256,000,000
2046
$269,000,000
$11,200,000
$258,000,000
2047
$270,000,000
$11,000,000
$259,000,000
2048
$272,000,000
$11,000,000
$261,000,000
2049
$273,000,000
$11,000,000
$263,000,000
2050
$276,000,000
$11,100,000
$265,000,000
Discount Rate
3%
7%
NPV
$4,640,000,000
$3,140,000,000
EAV
$253,000,000
$262,000,000
108
-------
Total annual savings associated with reduced refrigerant use from the 500-pound ALD threshold scenario
are estimated to be $13 million. Error! Reference source not found, below shows the annual savings by
rule component.
Table G-4: Total Annual Refrigerant Savings in 2025 (2022$) and Combined Annual Cost and
Annual Savings with 7% and 3% Discount Rate for 500-pound ALD Threshold Scenario
Rule Component
Annual
Refrigerant
Savings
Incremental
Compliance
Costs
Combined
Annual Savings
and Compliance
Costs
Incremental
Compliance
Costs
Combined
Annual Savings
and Compliance
Costs
7% Discount Rate
3% Discount Rate 1
Leak Repair
CC (Sub-small, 15-50 lbs.)
-$36,100
$3,054,000
$3,018,000
$1,450,000
$1,414,000
CC (Small, 51-199 lbs.)
$0
$0
$0
$0
$0
CC (Medium, 200-1,999 lbs.)
-$3,184,000
$8,798,000
$5,614,000
$4,210,000
$1,026,000
CC (Large, >2,000 lbs.)
-$120,900
$139,000
$18,000
$66,000
-$55,000
CR (Sub-small, 15-50 lbs.)
-$198,400
$3,748,000
$3,549,000
$1,780,000
$1,582,000
CR (Small, 51-199 lbs.)
-$183,500
$244,000
$60,000
$116,000
-$68,000
CR (Medium, 200-1,999 lbs.)
-$2,470,400
$1,997,000
-$474,000
$949,000
-$1,522,000
CR (Large, >2,000 lbs.)
-$1,348,900
$549,000
-$800,000
$259,000
-$1,090,000
1PR (Medium, 200-1,999
lbs.)
-$320,300
$152,000
-$168,000
$72,000
-$248,000
1PR (Large, >2,000 lbs.)
-$5,925,600
$734,000
-$5,192,000
$348,000
-$5,577,000
| Leak Inspection |
CC (Sub-small, 15-50 lbs.)
-
$10,012,000
$10,012,000
$10,012,000
$10,012,000
CC (Small, 51-199 lbs.)
-
$0
$0
$0
$0
CC (Medium, 200-1,999
lbs.)
-
$11,422,000
$11,422,000
$11,422,000
$11,422,000
CC (Large, >2,000 lbs.)
-
$141,000
$141,000
$141,000
$141,000
CR (Sub-small, 15-50 lbs.)
-
$24,392,000
$24,392,000
$24,392,000
$24,392,000
CR (Small, 51-199 lbs.)
-
$1,528,000
$1,528,000
$1,528,000
$1,528,000
CR (Medium, 200-1,999
lbs.)
-
$4,762,000
$4,762,000
$4,762,000
$4,762,000
CR (Large, >2,000 lbs.)
-
$884,000
$884,000
$884,000
$884,000
109
-------
Rule Component
Annual
Refrigerant
Savings
Incremental
Compliance
Costs
Combined
Annual Savings
and Compliance
Costs
Incremental
Compliance
Costs
Combined
Annual Savings
and Compliance
Costs
7% Discount Rate
3% Discount Rate 1
IPR (Medium, 200-1,999
lbs.)
-
$345,000
$345,000
$345,000
$345,000
IPR (Large, >2,000 lbs.)
-
$993,000
$993,000
$993,000
$993,000
Automatic Leak Detection |
CC
-
-
-
-
-
CR
-
$202,919,000
$202,918,800
$202,919,000
$202,918,800
IPR
-
$96,190,000
$96,189,800
$96,190,000
$96,189,800
Reporting & Recordkeeping |
CC and CR (15-50 lbs.)
-
$6,328,000
$6,328,000
$6,328,000
$6,328,000
CC, CR, and IPR (>50 lbs.)
-
$5,176,000
$5,176,000
$5,176,000
$5,176,000
Total
$13,788,100
$384,500,000
$370,720,000
$374,340,000
$360,550,000
Totals may not sum due to independent rounding.
More detailed results for reporting and recordkeeping associated with the 500-pound ALD threshold
scenario are shown in Error! Reference source not found, below.
Table G-5: 2025 Incremental Compliance Costs for Recordkeeping and Reporting (2022$) for
500-pound ALD Threshold Scenario
Recordkeeping & Reporting Rule Component
Direct Compliance Costs
CC and CR
(15-50 pounds)3
CC, CR, and
IPR (>50
pounds)
Total
Recordkeeping associated with leak inspection and repair
Owners/operators of appliances w/charge sizes >15
lbs maintain installation records.
$129,000
$284,000
$413,000
Persons servicing appliances w/charge sizes >15 lbs
provide invoices to appliance owners/operators.
$1,407,000
$1,173,000
$2,580,000
Owners/operators of appliances w/charge sizes >15
lbs maintain purchase and sen'ice records.
$1,924,000
$1,604,000
$3,528,000
Persons servicing appliances w/charge sizes >15 lbs
provide leak inspection records
$185,000
$132,000
$317,000
Owners/operators of appliances w/charge sizes >15
lbs maintain leak inspection records
$337,000
$240,000
$577,000
110
-------
Recordkeeping & Reporting Rule Component
Direct Compliance Costs
CC and CR
(15-50 pounds)3
CC, CR, and
IPR (>50
pounds)
Total
Owners/operators of appliances w/charge sizes >15
lbs prepare & submit requests for extensions to 30-
dav repair timeline
$7,000
$7,000
$14,000
Owners/operators of appliances w/charge sizes >15
lbs prepare & submit requests for extensions to 1-vear
retrofit/repair timeline
$1,000
$1,000
$2,000
Owners/operators of appliances w/charge sizes >15
lbs - Develop/Maintain plan to retire/replace or
retrofit equipment, as applicable
$1,619,000
$1,154,000
$2,773,000
Owners/operators of HFC appliances to submit
requests to cease retrofit/retirement if all leaks are
repaired
$5,000
$4,000
$9,000
Owners/operators of appliances w/charge sizes >15
lbs maintain records on mothballed equipment
<$200
<$100
<$200
Persons ser\>icing appliances w/charge sizes >15 lbs
provide reports on the results of verification tests
$185,000
$132,000
$317,000
Owners/operators of appliances w/charge sizes >15
lbs - Maintain reports on the results of verification
tests
$506,000
$360,000
$866,000
Owners/operators of appliances w/charge sizes >15
lbs prepare and submit a report to EPA if excluding
purged refrigerants that are destroyed from annual
leak rate calculations for the first time
<$100
<$100
<$100
Owners/operators of appliances w/charge sizes >50
lbs maintain information on purged/destroyed
refrigerant
<$100
<$100
<$100
Owners/operators of appliances submit report to EPA
and describe efforts to identify and repair systems
that leak 125% or more of the full charge in a 365
day period
$21,000
$15,000
$36,000
Owners/operators maintain records of anything that
is reported to EPA.
$1,000
$1,000
$2,000
Owners/operators of direct ALD systems maintain
records regarding the annual calibration or audit of
the system and any time the ALD system detects a
leak.a
$0
$68,000
$68,000
Total
$6,328,000
$5,176,000
$11,502,000
Ill
-------
Recordkeeping & Reporting Rule Component
Direct Compliance Costs
CC and CR
(15-50 pounds)3
CC, CR, and
IPR (>50
pounds)
Total
Totals may not sum due to independent rounding.
a The use of direct ALD monitoring is assumed to provide owners/operators with the information needed to satisfy this
requirement (i.e., no burden is assumed for those systems assumed to install direct ALD systems).
The 500-pound ALD threshold scenario is expected to reduce GHG emissions by approximately 4.0
MMTC02eq in 2025, as shown in
Table G-6: Annual GHG Emissions Avoided in 2025, 2030, 2040, and 2050for 500-pound ALD
Threshold Scenario
Rule Component
GHG Emissions Avoided (MTCChcq)
Leak Repair and Inspection
2025
2030
2040
2050
CC (Sub-small, 15-50 lbs.)a
5,900
6,500
7,300
8,000
CC (Small, 51-199 lbs.)
-
-
-
-
CC (Medium, 200-1,999 lbs.)
513,000
480,000
219,000
132,000
CC (Large, >2,000 lbs.)
17,900
15,800
12,200
9,300
CR (Sub-small, 15-50 lbs.)
65,000
59,600
45,700
50,400
CR (Small, 51-199 lbs.)
74,700
97,000
124,000
140,000
CR (Medium, 200-1,999 lbs.)
888,000
1,050,000
1,270,000
1,420,000
CR (Large, >2,000 lbs.)
551,000
527,000
470,000
443,000
IPR (Medium, 200-1,999 lbs.)
60,000
49,900
22,400
-
IPR (Large, >2,000 lbs.)
1,850,000
1,770,000
922,000
-
Total
4,020,000
4,060,000
3,090,000
2,180,000
Totals may not sum due to independent rounding.
As subsectors transition from higher-GWP refrigerants to lower-GWP refrigerants, the distribution of
refrigerant in use is anticipated to change significantly over the next decades, resulting in different leak
repair and inspection benefits for later years. Error! Reference source not found, below shows the
annual GHG emissions avoided from HFC refrigerants associated with the 500-pound ALD threshold
scenario.
112
-------
Table G-7: Annual GHG Emissions Avoided in Select Years for 500-pound ALD Threshold
Scenario
Year
HFC Emissions Avoided
(MTCChe)
2025
4,020,000
2029
4,070,000
2034
3,940,000
2036
3,670,000
2045
2,390,000
2050
2,200,000
Total 2025-2050
85,400,000
113
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Appendix H. SB RE FA Assumptions and Methodology
This screening analysis finds that the proposed rulemaking can be presumed not to have a significant
economic impact on a substantial number of small entities (SISNOSE).
This section describes the approach and assumptions used to estimate the economic impact on small
entities (businesses and governments) associated with the proposed regulatory requirements related to
leak repair and inspection, installation and maintenance of ALD systems, and reporting and
recordkeeping; the decision matrix used to make the SISNOSE determination; and the aggregated small
entities impacts.46 The proposed rulemaking applies to equipment used across a wide variety of businesses
and government entities,47 including school districts and cities. This analysis first assesses the economic
impact to small businesses and small governments separately and then aggregates the impact across both
types of entities to make a SISNOSE determination for the proposed rulemaking.
Approach for Estimating the Economic Impact on Small Businesses
The analysis uses a model entity approach to estimate impacts on small businesses for the leak repair, leak
inspection, ALD, and recordkeeping and reporting requirements for stationary refrigeration and air
conditioning appliances and transit buses48 containing more than 15 pounds of refrigerant. To estimate
costs per small business, assumptions were developed for each industry category affected by the proposed
regulatory changes (i.e., the proportion of facilities that would have appliances with refrigerant charges 15
or more pounds) and the type and number of appliances per affected facility and business. Costs per
model facility were developed to accurately reflect the range of compliance costs that a given small
business owner or operator could experience from leak repair, leak inspection, ALD installation, and
reporting and recordkeeping costs. Costs per model facility were then scaled to a model business on both
an industry-specific and equipment-specific basis. Therefore, each model business reflects information
about the average number of facilities a business has in a given industry category and equipment type
(i.e., smaller businesses typically have fewer facilities per business than larger businesses).
The regulation also includes a requirement to send disposable and refillable cylinders back to reclaimers
prior to disposal for recovery of the refrigerant heel. Companies that sell and distribute HFCs, in
particular refrigerant, will be impacted.
46 Costs associated with certain several mobile subsectors (i.e., Modern Rail Transport, Passenger Train AC, Vintage
Rail Transport, and Marine Transport) were not considered in this analysis, as it was determined that these
equipment types are wholly owned and operated by large entities.
47 The Regulatory Flexibility Act (RFA) defines small governments as the government of a city, county, town,
township, village, school district, or special district with a population less than 50,000 (EPA 2022).
48 Approximately 10% of transit buses are assumed to be operated by private industry (e.g., charter buses) (APTA
2022).
114
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Model Facility and Small Business Cost Assumptions for Leak Repair and
ALD Provisions
The model business approach is built up from the model equipment analysis described in Section 2.2 and
model facility assumptions developed for the average number of systems per facility, for each industry
category, as summarized in Table H-lError! Reference source not found.Error! Reference source not
found.. These assumptions were based on analysis of 2013 data reported under California's RMP, cross-
walked with assumptions made by similar analyses (CARB 2009a; Stratus 2009) about equipment use by
industry and reconciled with expert judgment.49
Table H-l: Average Number of Systems per Facility in Industries Containing Appliances with 15
or More Pounds of HFC Refiigerant
Industry Category
Average Systems per
Facility
CC
CR
IPR
Agriculture and Crop Support Services
1
2
-
Arts, Entertainment, and Recreation
1
"
Beverage and Ice Manufacturing
1
"
1
Charter Bus Industry
1
Durable Goods Wholesalers and Dealers
2
"
-
Educational Services
4
1
-
Food Manufacturing
1
2
-
General Merchandise Stores
1
2
49 Within each industry category, it was assumed that small businesses with annual revenue less than $200,000 do
not utilize equipment with more than 15 pounds of refrigerant, given that these equipment typically cool larger
spaces and equipment costs be cost prohibitive for these businesses (e.g., a typical commercial unitary air conditioning
system can cost between $20,000 to $25,000, which would represent up to 25% of total annual revenue for a business with 2 CC
units and an annual revenue of $200,000). Similarly, it was assumed that small businesses with revenue less than $500,000
would not utilize equipment with more than 1,500 pounds of refrigerant (i.e., would not have systems that require
installation of ALD systems). Thus, these businesses would not have installed equipment affected by leak repair and
inspection and ALD provisions of the rulemaking, respectively.
115
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Grocery and Specialty Food Stores
1
2
-
Hospitals
2
-
-
Ice Rinks
1
-
2
Non-durable Goods Wholesalers and Dealers
1
2
-
Non-food Manufacturing
2
-
3
Office Buildings
3
-
-
Other Warehousing, Storage, and Transportation
4
"
-
Refrigerated Warehousing and Storage
1
2
-
Research and Development
2
-
-
Utilities
2
-
-
Warehouse Clubs and Supercenters
1
3
Potential compliance costs for each model facility were developed to accurately reflect the range of
compliance costs that a given small business owner or operator could experience from leak repair, leak
inspection, ALD installation, and reporting and recordkeeping requirements. For each business, there are
many potential configurations of equipment types, equipment sizes, and repair outcomes that determine
compliance costs for stock above the leak rate threshold. Considering these multiple possibilities, "worst
case" model facility assumptions were adopted for standard leak repair and extension leak repair
outcomes. The "worst case" reflects the possibility that appliances with leak rates above the threshold
leak rate are clustered in individual facilities, such that all of the eligible appliances in a single model
facility might trigger inspection and repair. Within each facility, it is assumed that multiple units of the
same appliance type are maintained in the same way (e.g., if a facility has two CR systems, both
appliances are assumed to have similar leak rates), and thus experience the same leak repair outcomes.
Model facility scenarios were developed for each industry category based on how many different sizes of
appliances the industry is assumed to use within each sector and the expected number of leak repair
outcomes. Retrofit outcomes were determined to only occur to a maximum of one piece of equipment per
model facility. Each scenario features a different combination of appliance sizes and leak repair
outcomes, with likelihood of each leak repair outcome based on estimates in TABLE 3.
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Economic impacts to small businesses associated with ALD installation and maintenance were also
developed using the model facility approach. Although the number of potential configurations of
equipment are lower because CC equipment are exempt from ALD requirements and only CR and IPR
equipment with charge sizes greater than 1,500 pounds are impacted, a larger number of facilities are
impacted because ALD requirements apply to all new and existing CR and IPR equipment with charge
sizes greater than 1,500 pounds.50
Expected compliance costs per model facility were estimated by multiplying the (a) unit cost assumptions
described in Chapter 3 averaged across all equipment within a given size category for each sector plus the
expected reporting and recordkeeping costs per facility, by the (b) model facility configurations for each
industry sector. Costs to small businesses were then scaled based on the proportion of facilities-to-
businesses for small businesses in each size category of each NAICS code in each industry category.
Some small businesses within each NAICS code and industry category, that operate appliances that are
subject to the rule (i.e., CC, CR, and IPR equipment containing more than 15 pounds of refrigerant), are
not expected to experience any compliance costs. This is because not all systems will leak above the
threshold leak rates (see TABLE 2), and therefore do not require leak repair or inspection or the
installation of ALD systems.
Small Business Cost Assumptions for Requiring Heel Recovery from
Disposable and Refillable Cylinders
The regulation also institutes a requirement to recover refrigerant heels from disposable cylinders (i.e.,
non-refillable cylinders), which are primarily used to charge and service stationary refrigeration and air-
conditioning systems, and refillable cylinders prior to their disposal. Disposable cylinders are specifically
manufactured to be single use. These cylinders are charged with refrigerant, sold for use to fill or service
equipment, and disposed (EIA 2018). Disposable cylinders are typically discarded with amounts of
refrigerants still in the cylinders that will be emitted over time including from amounts commonly
referred to as heels. Refillable cylinders can be reused for more than 20 years (National Refrigerants
2021). Upon being emptied by service technicians, refillable cylinders are typically returned to the
wholesaler for reuse. As with disposable cylinders, refillable cylinders will not typically be 100 percent
empty after use. Service technicians will generally stop using a cylinder once all the liquid-phase gas has
been extracted while the vapor-phase gas remains as a heel. When a refillable cylinder is disposed, either
from reaching end-of-life or due to damage to the cylinder, the heel would be emitted to the atmosphere
unless it is removed.
50 For the purposes of this screening analysis, facilities experiencing leak repair and inspection costs are separate
from facilities experiencing ALD costs.
117
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Small Entities Potentially Subject to Refrigerant Heel Recovery Requirements
The requirement to remove refrigerant heels from cylinders before disposable would directly impact those
companies that sell or distribute or repackage refrigerant in such cylinders, as these companies would be
required to return their used cylinder to a reclaimer prior to disposal such that the heel can be recovered
instead of sending the cylinder directly to a steel recycler for disposal. For this analysis, potentially
affected entities are assumed to be producers, importers, exporters, reclaimers, and companies that sell
and distribute HFCs (e.g., blenders, repackagers, and wholesalers or distributors of refrigerants).51 Error!
Reference source not found, lists the potentially affected industries by NAICS code and the estimated
number of small businesses affected.
Table H-2: List of Industries Potentially Affected by the Prohibition of Disposable Cylinders by
NAICS Code
NAICS
Code
NAICS Industry Description
Size Standard
in Millions of
Dollars
Size Standard in
Number of
Employees
Estimated Number
of Small Businesses
Affected
325120
Industrial Gas Manufacturing
1000
0a
562920
Materials Recovery Facilities
22
44a
423740
Refrigeration Equipment and
Supplies Merchant Wholesalers
100
298b
423730
Warm Air Heating and Air-
Conditioning Equipment and
Supplies Merchant Wholesalers
150
l,028b
424690
Other Chemical and Allied
Products Merchant Wholesalers
150
2,881b
Source: Small Business Size Regulations, 3 CFR Part 121.201 (2023)
a Based on known HFC producers and reclaimers.
bIt was assumed that 50 percent of businesses within these NAICS codes are refrigerant wholesalers and would be directly affected by
the requirement to recover refrigerant heels from cylinders prior to disposal. It is also assumed that the remaining 50 percent of
businesses could be affected by the prohibition of disposable cylinders such that they are considered within the universe of potentially
affected entities but are expected to experience minimal economic impacts.
51 For the purposes of this analysis, it is conservatively assumed that producers transport refrigerant primarily in
containers larger than 30-lbs. cylinders and therefore the total inventory of 4.5 million cylinders was distributed
across importers, exporters, reclaimers, and companies that sell and distribute HFCs (e.g., blenders, repackagers, and
wholesalers or distributors of refrigerants) defined by the NAICS codes in Error! Reference source not found..
118
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Estimated Economic Impacts of Requiring Refrigerant Heel Removal from Cylinders prior
to Disposal
For the purposes of quantifying direct compliance costs for this analysis, it was assumed that producers,
importers, exporters, reclaimers, and companies that sell and distribute HFCs currently sell refrigerant
using 4.5 million HFC cylinders.52 All direct compliance costs are calculated as the difference between
costs and savings currently incurred under the current business-as-usual (BAU) scenario and those
estimated to be incurred under the provisions of the rulemaking.
Cost of transport. Refillable cylinders are only marginally heavier than the largest quantity disposable
cylinder on the market. For example, a refillable cylinder containing R-410A weighs approximately 42
pounds (i.e., 25 pounds for the gas and 17 pounds for the cylinder) and a standard disposable cylinder
HFC-134a is 39 pounds (i.e., 30 pounds for the gas and 9 pounds for the cylinders) (Government of
Australia 2021). However, refillable cylinders require additional trips throughout their use cycle
compared to a disposable cylinder. Disposable cylinders are assumed to travel from gas producer/filler to
the wholesale distributor; wholesale distributor to end user/technician; and end user/technician to steel
recycler.
Refillable cylinders are assumed to travel from the gas producer/filler to the wholesale distributor and
from the wholesale distributor to the end user/technician. After cylinders are returned to the wholesale
distributor, for approximately half of cylinders sold, distributors would send returned refillable cylinders
directly to the gas producers, who would then remove the refrigerant heel and store it until a significant
amount has accumulated before sending to the reclaimer. The other half are assumed to be sent from the
wholesale distributor to the reclaimer and then back to the gas producer/filler.
Transportation costs were updated to account for the distance traveled for each trip and the use of
company fleets to transport cylinders based on a CARB (2011) analysis. It is assumed that companies
already own or lease the proper vehicle fleet to transport cylinders.
Table H-3 summarizes distances per shipment for disposable and refillable cylinders. Based on the
location of chemical production facilities around the United States, located primarily along the East
Coast, Midwest, Southern United States, and California, it is assumed that a cylinder would travel an
52 Industry estimates that refillable cylinders account for between less than 1 percent and 10 percent of all 30-pound
cylinders used, with a general assumption that the quantity of refillable cylinders as a percentage of all 30-pound
cylinders used is closer to 1 percent (A-Gas 2021, National Refrigerants 2021, Fluorofusion 2021). For the purposes
of this analysis, it is assumed that 1 percent of all 30-pound cylinders sold in the United States are refillable.
119
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average of 1,000 miles from producer to the wholesale distributor. As assumed in CARB (2011), the
distance between wholesale distributor and end user/technician is assumed to be 25 miles. For the
refillable scenario, it is assumed that a distributor is regularly dropping off new refrigerant to their
customers and would pick up their empty, refillable cylinders on the same trip (or the end user would
drop off their empty cylinders to pick up new ones, such that no additional trip for the return of cylinders
is necessary. It is also assumed that the distributor would make the determination whether the refillable
cylinder is fit for subsequent reuse or would be sent for disposal. Other distances were also based on
CARB (2011).
In the recovery scenario, it was assumed that approximately 50 percent of non-refillable cylinders and
refillable cylinders would be returned directly to a reclaimer for heel recovery and 50 percent of cylinders
would be returned to the distributor and then to the reclaimer for recovery. Upon recovery of the heel, the
reclaimer would send the cylinder for recycling.
Table H-3: Travel Distances for Disposable and Refillable Cylinders Before Disposal
BAU
Recovery Scenario
irip
Disposable
Refillable
Disposable-
lb
Disposable-2
b
Refillable-1b
Refillable-2 b
Gas producer/filler
to wholesale
distributor
1,000
1,000
1,000
1,000
1,000
1,000
Wholesale
distributor3 to end
user/technician
25
25
25
25
25
25
End user/technician
to steel recycler
75
NA
NA
NA
NA
NA
End user/technician
to reclaimer
NA
NA
50
NA
50
NA
End user/technician
to distributor
NA
NA
NA
25
NA
25
Distributor to
reclaimer
NA
NA
NA
50
NA
50
120
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Wholesale
distributor or
reclaimer to steel
recycler
NA
75
75
75
75
75
Total Miles
1,100
1,100
1,150
1,175
1,150
1,175
a The wholesale distributor is assumed to regularly drop off new refrigerant and pick up empty, refillable cylinders on
the same trip.
b Only assumed for 50 percent of shipped cylinders.
Table H-4 provides additional assumptions related to fuel use and labor associated with transporting
cylinders.
Table H-4: Additional Transportation Assumptions
Parameter
Assumption
Average Fuel Efficiency
6 miles per gallon3
Diesel Fuel Cost
$4.998/gallonb
Average Truck Speed
50 miles per hour0
Labor Rate (Truck Transport)
$50.4d
a ICCT (2015)
b U.S. EIA (2023)
c CARB (2011)
d Labor rate for Heavy and Tractor-Trailer Truck Drivers from Bureau of Labor Statistic's Employer Costs for
Employee Compensation - May 2020. Median hourly wages rates were multiplied by a factor of 2.1 to reflect the
estimated additional costs for overhead (BLS 2022a).
Transportation costs were then calculated on a per cylinder basis. This analysis conservatively estimates
transportation costs on a per cylinder basis assuming a truck could fit approximately 1,120 disposable
cylinders or 870 refillable cylinders (CARB 2011). Recent information about cylinder transport indicates
that refillable cylinders are typically shipped in metal containers that are approximately the same size as a
pallet of disposable cylinders, but because containers for refillable cylinders are more durable and can be
stacked higher, they offer improved storage efficiency compared to disposable cylinders (Government of
Australia 2021). Error! Reference source not found, summarizes the transport cost per cylinder based
on the assumptions presented above.
121
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To calculate annual transport costs per small business, it was assumed that a total of 4.5 million cylinders
are transported per year under both the BAU scenario and the provisions of the rulemaking. An estimated
1 percent of the 4.5 million cylinder fleet are assumed to be refillable cylinders, of which an estimated 5
percent of are disposed each year to account for the number of refillable cylinders reaching end-of-life
annually and to account for any damaged cylinders. The number of cylinders transported before disposal
per small business was distributed across businesses in proportion to their annual sales (Census Bureau
2020).
Table H-5: Transportation Assumptions before Disposal per Cylinder
Scenario
Fuel Costs
Labor
Total
BAU
Disposable
$0.82
$0.99
$1.81
Refillable
$1.05
$1.27
$2.33
Disposable-la
$0.86
$1.04
$1.89
Recovery
Disposable-23
$0.87
$1.06
$1.93
Scenario
Refillable-la
$1.10
$1.33
$2.43
Refillable-2a
$1.13
$1.36
$2.49
a Assumed applicable to 50 percent of cylinders.
Recovered heel. Under the recovery scenario, disposable and refillable cylinders are returned to a
reclaimer prior to disposal containing a refrigerant heel that is recovered and sold back into the market. It
was assumed that cylinders contain a heel of approximately 0.96 pounds based on CARB (2011) and
expert judgment. Recovered refrigerant is assumed to be resold at approximately $4 per pound based on
average refrigerant costs applied in EPA (2021a). The total annual savings associated with recovered heel
was distributed across businesses in proportion to their assumed number of cylinders (as estimated under
previous steps).
Table H-6 summarizes the cost assumptions associated with the requirement to recover the refrigerant
heel from Disposable and refillable cylinders prior to disposal.
122
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Table H-6: Cost Assumptions for BA U and Rulemaking from Cylinder Heel Recovery
Requirement
Assumption
Cylinder Type
BAU
Rulemaking
Number of Cylinders Disposed
Disposable
4,455,000
4,455,000
Refillable
45,000
45,000
Average Transport Cost per Cylinder
Disposable
$1.81
$1.91
Refillable
$2.33
$2.46
Cylinder Heel Amount (lbs.) and Percent of
Cylinder
Both
0.96 (4%)
0.96 (4%)
Average Refrigerant Price ($/lbs.)
Both
$4
$4
Costs of Data Entry into Cylinder Tracking ID System. Affected businesses would also experience
costs associated with scanning the QR code affixed to cylinders and entering data into the cylinder
tracking ID system as they are bought or sold, consistent with the Information Collection Request for this
rulemaking. These costs were distributed across businesses in proportion to their total cylinder purchases.
Summary of Economic Impacts. To inform the sales test, economic data about each affected industry—
including number of firms by employment and receipts size—was obtained from the U.S. Census
Bureau's Statistics of U.S. Businesses. Annualized compliance costs for small businesses in each affected
industry were compared to annual sales by firm size, as shown in Error! Reference source not found..
As shown, all small businesses are expected to experience a positive economic impact (i.e., cost savings)
associated with the requirement to recover heels prior to cylinder disposal.
123
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Table H-7: Summary of Annual Economic Impacts from Cylinder Heel Recovery Requirement on Small Businesses by NAICS Code
Number of
Assumed
Annual Cost per Small Business
Total
Employee Size
Small
Businesses
Affected
Average
Annual Sales
per Firm
Cylinder
Fleet per
Firm
Average Incremental
Annual Transport
Costs
Heel Savings
Annual Cost of
Data Entry into
Cylinder Tracking
ID System
Annual Cost
per Small
Business
Impact as
Percent of
Annual Sales
Materials Recovery Facilities (Reclaimers)
<5
17
$812,953
10
$1
-$36
$4
-$32
-0.004%
5-9
9
$2,324,738
27
$3
-$104
$10
-$90
-0.004%
10-19
7
$3,827,942
45
$5
-$170
$17
-$149
-0.004%
20-99
9
$9,672,086
113
$12
-$431
$43
-$376
-0.004%
100-499
2
$19,182,700
225
$23
-$854
$85
-$746
-0.004%
Refrigeration Equipment and Supplies Merchant Wholesalers
<5
142
$663,350
23
$2
-$87
$9
-$76
-0.01%
5-9
67
$3,509,805
121
$12
-$461
$46
-$402
-0.01%
10-19
44
$5,826,375
201
$21
-$765
$76
-$668
-0.01%
20-99
45
$22,108,876
763
$79
-$2,902
$290
-$2,534
-0.01%
Warm Air Heating and Air-Conditioning Equipment and Supplies Merchant Wholesalers
124
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<5
405
$1,174,630
41
$4
-$156
$16
-$136
-0.01%
5-9
214
$3,293,890
115
$12
-$437
$44
-$382
-0.01%
10-19
176
$7,224,339
252
$26
-$959
$96
-$837
-0.01%
20-99
222
$22,987,391
802
$83
-$3,052
$305
-$2,665
-0.01%
100-149
11
$136,390,545
4,761
$490
-$18,107
$1,807
-$15,810
-0.01%
Other Chemical and Allied Products Merchant Wholesalers
<5
1596
$1,737,181
60
$6
-$230
$23
-$201
-0.01%
5-9
527
$5,067,550
176
$18
-$671
$67
-$586
-0.01%
10-19
361
$12,563,032
437
$45
-$1,664
$166
-$1,453
-0.01%
20-99
356
$28,842,041
1,004
$103
-$3,820
$381
-$3,335
-0.01%
100-149
41
$115,711,086
4,029
$415
-$15,326
$1,530
-$13,381
-0.01%
125
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Approach for Estimating the Economic Impact on Small Governments
This analysis also uses a model entity approach to estimate impacts on small school districts and small
governments for the leak repair, leak inspection, and recordkeeping and reporting requirements for school
buses and transit buses, respectively.53
In the United States, there are approximately 13,08554 school districts with atotal enrollment of 33.1
million students as of 2018 (Urban Institute Education Data Portal 2022) and 482,714 yellow school
buses55 (EPA 2023a). There are approximately 57,006 public transit buses in the United States serving
over 174 million people in 3,030 cities as of 2017 (GFOA N.d.). This analysis assumes that each school
district utilizes school buses for student transportation, and each city utilizes transit buses for public
transportation. Furthermore, although approximately 40% of school buses and 28% of transit buses are
contracted, it is assumed that costs associated with the proposed rulemaking would be passed down to the
individual school districts and cities (APTA 2022). Therefore, this analysis assumes that every school
district and city is potentially impacted by the proposed rulemaking.
Model Facility and Small Government Cost Assumptions
To analyze and estimate the economic impact of the proposed leak repair and inspection provisions on
school and transit buses, school districts were grouped into ten groups based on enrollment and transit
buses were grouped into thirteen groups based on population. For school districts, the average enrollment,
population within the school district, and revenue for the associated local government of each school
district were determined for each enrollment size. For cities, the average population and revenue for the
associated local government of each city were determined for each population size. Of the ten school
enrollment groups, four were defined as small government with an average population of 50,000 or less
and represent 12,187 school districts. Of the thirteen city population groups, four were defined as a small
government with populations less than 50,000 and represent 2,276 cities.
As noted above, there are approximately 482,714 yellow school buses in use in the United States across
13,085 school districts. Approximately 51% of students ride a school bus as their primary means of
53 Approximately 90% of transit buses are assumed to be operated by transit agencies (APTA 2022).
54 56 school districts have an enrollment of 0 students and were therefore not included in this analysis.
55 While federal law does not require school buses to be yellow, the National Highway Traffic Safety Administration
(NHTS A) provides recommendations to states on transportation safety and operational aspects of school buses.
Along with other matters and uniform identifying characteristics, NHTSA recommends that school buses be painted
"National School Bus Glossy Yellow".
-------
transportation (USAFacts 2022), which equates to an average of 34 students per school bus. With
approximately 51,305 public-owned transit buses, about 5% of the total population utilizes bus transit
(Census 2021), which equates to an average of 180 people per bus.
Table H-8 summarizes the average enrollment, population, revenue, and number of school buses per
school district within the four small government enrollment groups and the average population, revenue,
and number of transit buses per city within the four small government population groups.
Table H-8: School District and City Government Population and Revenue by Enrollment and
Population Size
Enrollment
Group
Number of
Districts
Average
Enrollment
per District
Average
Population
per District
Average
Revenue per
District
Average
School Buses
per District
School Buses
0-500
5,524
235
1,875
$4,138,069
3
501-999
2,538
712
5,458
$11,246,957
10
1,000-4,999
3,726
2,244
17,058
$37,866,965
33
5,000-9,999
399a
6,930
52,355
$112,226,575
101
Population Group
Number of
Cities
Average
Population
per City
Average
Revenue per
City
Average
Transit
Buses per
City
Transit Buses
4
7
10
40,000-49,999
185
44,702
$99,530,151
13
Bolded rows represent a small government school district.
Source: Urban Institute Education Data Portal (2022) and Government Finance Officers Association (n.d.).
a Approximately 59% of the school districts within the 5,000-9,999 enrollment group are below the small government
threshold.
127
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Based on the analysis outlined in Appendix A, 193,086 school buses are anticipated to exceed the
threshold leak rate and 22,802 transit buses are anticipated to exceed the threshold leak rate, and both are
assumed to experience the leak repair outcomes outlined in Table A-2. Total standard leak repairs are
distributed to every school district and city in proportion to the number of buses each school district and
city uses. Because there are significantly fewer extension and retrofit repairs than standard leak repairs,
extension and retrofit repairs are distributed within each group based on total number of buses within each
group such that some districts and cities within each enrollment and population size will experience
extension and/or retrofit repairs. This analysis therefore assumes that every school district and city
experiences at least one standard leak repair, but not every school district and city is assumed to
experience an extension or retrofit repair.
Table H-9: Leak Repair Outcomes per School District or City
Enrollment
Group
School
Districts
Average
School
Buses per
District
Total School
Buses per
Enrollment
Group
Standard
Repairs per
School
District
Extension
Repair per
Enrollment
Group
Retrofit
Repair per
Enrollment
Group
School Buses
0-500
5,524
3
16,572
1
58
67
501-999
2,538
10
25,380
4
89
102
1,000-4,999
3,726
33
122,958
13
431
495
5,000-9,999
399
101
40,299
40
141
162
Population
Group
Cities
Average
Transit
Buses per
City
Total Transit
Buses per
Population
Group
Standard
Repairs per
City
Extension
Repair per
City
Retrofit
Repair per
City
Transit Buses
10,000-19,999
1,235
4
4,940
2
19
22
20,000-29,999
542
7
3,794
3
15
17
30,000-39,999
314
10
3,140
4
12
14
40,000-49,999
185
13
2,405
6
9
11
To estimate the economic impact of the leak repair and inspection provisions on school buses, four model
government scenarios were established to represent various combinations of leak repair outcomes for
each school district: standard repair only, standard repair + extension repair, standard repair + retrofit
repair, and standard repair + extension repair + retrofit repair.
The four model governments are established based on the lowest number of repair type instances (in this
case, extension repairs). It was therefore assumed that 50% of extension and retrofit repairs are
experienced by a school district and city in addition to the assumed standard repair(s) for each group (i.e.,
standard repair + extension repair or standard repair + retrofit) and 50% of extension and retrofit repairs
128
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are experienced together by a school district and city in addition to the assumed standard repair(s) for
each group (i.e., standard leak repair + extension repair + retrofit repair). The number of school districts
and cities affected by each leak repair scenario is summarized in Table H-10.
Table H-10: Number of School Districts and Cities Affected by Leak Repair Scenarios
Average
Number of School Districts Impacted
Enrollment Group
School
Districts
School
Buses
per
District
Standard
Repair
Only
Standard
+
Extension
Repair
Standard
+ Retrofit
Repair
Standard +
Extension +
Retrofit
Repair
School Buses
0-500
5,524
3
5,428
29
38
29
501-999
2,538
10
2,392
45
58
45
1,000-4,999
3,726
33
3,016
216
280
216
5,000-9,999
399
101
167
71
92
71
Average
Transit
Buses
per City
Number of Cities Impacted
Population Group
Cities
Standard
Repair
Only
Standard
+
Extension
Repair
Standard
+ Retrofit
Repair
Standard +
Extension +
Retrofit
Repair
Transit Buses
10,000-19,999
1,235
4
1,204
10
13
10
20,000-29,999
542
7
518
8
10
8
30,000-39,999
314
10
294
6
8
6
40,000-49,999
185
13
170
5
7
5
Cost estimates for each leak repair scenario were applied to each school district and city to evaluate the
burden compared to their average revenue (see sections 3.2 and 3.7 for discussion of leak repair, leak
inspection, and reporting and recordkeeping cost estimates).
Decision Matrix for Determining Significant Economic Impact on a
Substantial Number of Small Entities
This analysis uses the matrix shown in Error! Reference source not found, to determine whether this
rulemaking would impose a SISNOSE. The economic threshold levels are set conservatively at 1% and
3% of sales, consistent with similar analyses of other Clean Air Act Title VI rules. These thresholds are
set conservatively because the rulemaking affects small businesses in a range of different industries,
which may have significantly different profit margins and abilities to pass compliance costs along to
customers, and a range of small governments with significantly different revenue. Based on this decision
matrix, this screening analysis finds that the rulemaking can be presumed to have no SISNOSE.
129
-------
Table H-ll: Decision Matrix for Certifying SISNOSE
Economic Impact
Number of Small Entities
Subject to the Rule and
Experiencing Given
Economic Impact
Percent of All Small
Entities Subject to the
Rule That Are
Experiencing Given
Economic Impact
Certification Category
Less than 1% for all
affected small entities
Any number
Any percent
Presumed No SISNOSE
1% or more for one or
more affected small
entities
Fewer than 100
Less than 20%
Presumed No SISNOSE
Fewer than 100
20% or more
Uncertain - No
Presumption
Between 100 and 999
Less than 20%
Presumed No SISNOSE
Between 100 and 999
20% or more
Uncertain - No
Presumption
1000 or more
Any percent
Uncertain - No
Presumption
Greater than 3% for one
or more affected small
entities
Fewer than 100
Less than 20%
Presumed No SISNOSE
Fewer than 100
20% or more
Uncertain - No
Presumption
Between 100 and 999
Less than 20%
Uncertain - No
Presumption
Between 100 and 999
20% or more
Presumed Ineligible for
Certification
1000 or more
Any percent
Presumed Ineligible for
Certification
Aggregate Small Entities Impacts of Regulatory Changes
As shown in Table H-12Error! Reference source not found., an estimated 165,830 small businesses and
14,463 small governments may be subject to the regulatory actions.
Table H-12: Summary of the Small Entities Impact
Entity
Estimated Number of Small
Entities Affected by the Rule
Small Business Industry Type
Agriculture and Crop Support Services
3,015
Arts, Entertainment, and Recreation
183
Beverage and Ice Manufacturing
424
130
-------
Entity
Estimated Number of Small
Entities Affected by the Rule
Charter Bus Industry
908
Durable Goods Wholesalers and Dealers
575
Educational Services
75
Food manufacturing
3,788
Grocery and Specialty Food Stores
48,556
Hospitals
259
Non-durable Goods Wholesalers and Dealers
2,364
Non-food Manufacturing
43,229
Office Buildings
9,594
Other Warehousing, Storage, and Transportation
44,110
Refrigerated Warehousing and Storage
388
Utilities
4,111
Materials Recovery Facilities (Reclaimers)
44
Refrigeration Equipment and Supplies Merchant
Wholesalers
298
Warm Air Heating and Air-Conditioning Equipment and
Supplies Merchant Wholesalers
1,028
Other Chemical and Allied Products Merchant
Wholesalers
2,881
Small Government Type
School Districts
12,187
City Government
2,276
Total
180,293
Totals may not sum due to independent rounding.
To analyze the economic impacts on small entities against the SISNOSE decision matrix, a "sales test"
was applied, which calculates annualized compliance costs as a percentage of annual sales for businesses
in each NAICS code by size category and annual revenue for governments. Total economic impact
includes incremental compliance costs for leak repair and inspection and ALD installation, as well as
compliance costs for reporting and recordkeeping. For industries for which annual sales data were not
available through the Economic Census, annual receipts or annual value of shipments56 was used as a
proxy.
56 Total value of shipments includes the received or receivable net selling values of all products shipped (excluding
freight and taxes).
131
-------
Table H-13 aggregates the estimated economic impacts on small entities, according to the categories set
out in the SISNOSE decision matrix and using a 7% discount rate. Using the decision criteria established
in Error! Reference source not found., this screening analysis suggests that this rulemaking can be
presumed to have no SISNOSE for the following reasons:
¦ About 72,870 small entities (40.4%) are expected to experience negligible to net positive (i.e., cost-
saving) impacts.
¦ About 106,694 small entities (59.2%) are estimated to incur compliance costs that will be less than
1% of annual sales/revenue.
¦ About 730 of the approximately 107,422 affected small entities (<0.40%) could incur costs in excess
of 1% of annual sales/revenue. Approximately 59 small entities (<0.033%) could incur costs in excess
of 3% of annual sales/revenue. These estimates are below the thresholds for a substantial number
determination (i.e., between 100 and 999 entities and less than 20% of affected entities).
Table H-13: Aggregated Economic Impacts on Small Entities with 7% Discount Rate
Economic
Impact
Less than 1% for
all affected small
entitiesa
Entity Type
Number of Small
Entities Subject to the
Rule and
Experiencing Given
Economic Impact
Grocery & Specialty Food Stores
48,223
Agriculture and Crop Support
Services
3,008
Utilities
1,308
Food Manufacturing
2,328
Beverage & Ice Manufacturing
503
Non-Food Manufacturing
23,060
Refrigerated Warehousing and
Storage
437
Other Warehousing, Storage, and
Transportation
8,487
Entities Subject to the
Rule
132
-------
1% or more for
one or more
affected small
entities b
Non-durable Goods Wholesalers
and Dealers
2,301
Durable Goods Wholesalers and
Dealers
161
Educational Services
172
Hospitals
lul
Office Buildings
1,927
Arts, Entertainment, and
Recreation
127
Charter Bus Industry
8"
School Districts
12.187
City Government
2,276
Total
106,694
59.2%
Grocery & Specialty Food Stores
332
Agriculture and Crop Support
Services
7
Utilities
32
Food manufacturing
80
Beverage & Ice Manufacturing
9
Non-food Manufacturing
113
Refrigeration Warehousing &
Storage
<5
Other Warehousing, Storage,
Transportation
4o
Non-durable Goods
63
Durable Goods
7
133
-------
Educational Services 1
14
Office Buildings
19
Arts, Entertainment, Rec.
<5
Charter Bus Industry
<5
Total
729
0.40%
Grocery & Specialty Food Stores
7
\unculiuie and Crop Suppun
Services
<5
Utilities
10
Food manufacturing
<5
Beverage & Icc Manufacturing
<5
Greater than 3%
for one or more
Non-food Manufacturing
22
affected small
entities b
Other Warehousing. Storage.
Transportation |
6
Non-durable Goods
6
Durable Goods
<5
Educational Services
<5
, Office Buildings
<5
Arts, Entertainment, Rec.
<5
, Total ,
59
<0.01%
Totals may not sum due to independent rounding.
a Represents small entities affected with an economic impact equal to or less than 1% but greater than 0%. Approximately 72,870
affected small businesses—or 40.4 percent—would be expected to experience negligible to net positive (i.e., cost-saving)
impacts.
b This category aggregates the number of small entities that would be expected to experience an impact of 1% to 3% with the
number of small entities that would be expected to experience an impact of 3% or greater.
Error! Reference source not found, aggregates the estimated economic impacts on small entities,
according to the categories set out in the SISNOSE decision matrix and using a 3% discount rate. Using
134
-------
the decision criteria established in Error! Reference source not found., this screening analysis suggests
that this rulemaking can be presumed to have no SISNOSE for the following reasons:
¦ About 72,870 small entities (40.4%) are not expected to incur compliance costs.
¦ About 106,862 small entities (59.3%) are estimated to incur compliance costs that will be less than
1% of annual sales/revenue.
¦ About 560 of the approximately 107,422 affected small entities (<0.31%) could incur costs in excess
of 1% of annual sales/revenue. Approximately 12 small entities (<0.006%) could incur costs in excess
of 3% of annual sales/revenue. These estimates are below the thresholds for a substantial number
determination (i.e., between 100 and 999 entities and less than 20% of affected entities).
Table H-14: Aggregated Economic Impacts on Small Entities with 3% Discount Rate
Economic
Impact
Less than 1% for
all affected small
entitiesa
Entity Type
Number of Small
Entities Subject to the
Rule and
Experiencing Given
Economic Impact
Grocery & Specialty Food Stores
48,300
Agriculture and Crop Support
Services
3,009
Utilities
1,314
Food Manufacturing
2,349
Beverage & Ice Manufacturing
506
Non-Food Manufacturing
23,096
Refrigerated Warehousing and
Storage
437
Other Warehousing, Storage, and
Transportation
8,500
Entities Subject to the
Rule
135
-------
1% or more for
one or more
affected small
entities b
Non-durable Goods Wholesalers
and Dealers
2,309
Durable Goods Wholesalers and
Dealers
161
Educational Services
173
Hospitals
lul
Office Buildings
1,929
Arts, Entertainment, and
Recreation
128
Charter Bus Industry
8"
School Districts
12.187
City Government
2,276
Total
106,862
59.3%
Grocery & Specialty Food Stores
256
Agriculture and Crop Support
Services
6
Utilities
:o
Food manufacturing
58
Beverage & Ice Manufacturing
7
Non-food Manufacturing
77
Refrigeration Warehousing &
Storage
<5
Other Warehousing, Storage,
Transportation
34
Non-durable Goods
55
Durable Goods
7
136
-------
Educational Services
12
Office Buildings
17
Arts, Entertainment Rec.
<5
Charter Bus Industry
<5
Total
560
0.31%
3% or more for
one or more
affected small
entities b
Utilities
9
Food manufacturing
<5
Non-durable Goods
<5
Durable Goods
<5
Office Buildings
<5
Total
12
<0.01%
Totals may not sum due to independent rounding.
a Represents small entities affected with an economic impact equal to or less than 1% but greater than 0%. Approximately
72,870 affected small businesses—or 40.4 percent—would be expected to experience negligible to net positive (i.e., cost-
saving) impacts.
b This category aggregates the number of small entities that would be expected to experience an impact of 1% to 3% with
the number of small entities that would be expected to experience an impact of 3% or greater.
137
-------
Additional References
Government Finance Officers Associations (GFOA). N.d. Local Government Revenue Sources - Cities.
Available online at: https://www.gfoa.org/revenue-dashboard-cities
Urban Institute Education Data Portal. 2022. School Districts Data Explorer. Available online at:
https://educationdata.urban.Org/documentation/school-districts.html#detail description. USAFacts.
2022. How much does the government spend on getting kids to school? Available online at:
https://usafacts.org/articles/how-much-does-the-government-spend-on-getting-kids-to-
school/#:~:text=Qf%20the%2050%20million%20students%20ages%205%20to.school-
aged%20children%20travel%20to%20school%20via%20private%20vehicle
U.S. Bureau of Labor Statistics. 2022a. Occupational Employment and Wages, May 2020, 53-3032
Heavy and Tractor-Trailer Truck Drivers. Updated May 2022. Available online at:
https://www.bls.gov/oes/current/oes533032.htm
U.S. Bureau of Labor Statistic 2022b. May 2022 National Industry-Specific Occupational Employment
and Wage Estimates, NAICS 562900 - Remediation and Other Waste Management Services.
Available online at: https://www.bls.gov/oes/current/naics4_562900.htm.
U.S. Bureau of Labor Statistic 2022c. May 2022 National Industry-Specific Occupational Employment
and Wage Estimates, NAICS 4240A2 - Merchant Wholesalers, Nondurable Goods (4242 and
4246 only). Available online at: https://www.bls.gov/oes/current/naics4_4240A2.htm.
U.S. Bureau of Labor Statistic 2022d. May 2022 National Industry-Specific Occupational Employment
and Wage Estimates, NAICS 4230A1 - Merchant Wholesalers, Durable Goods (4232, 4233,
4235, 4236, 4237, and 4239 only) Available online at:
https://www.bls.gov/oes/current/naics4_4230Al.htm.
U.S. Energy Information Administration. 2022. Gasoline and Diesel Fuel Update, 2022. Available online
at: https://www.eia.gov/petroleum/gasdiesel/
U.S. Environmental Protection Agency (EPA). 2022. Learn About the Regulatory Flexibility Act.
Available online at: https://www.epa.g0v/reg-flex/learn-about-regulatorv-flexibilitv-act#def1nitions.
138
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Appendix I. NAICS Classification for Leak Repair Requirements
Table 1-1: NAICS Codes Included in the Leak Repair Analysis
Sector
Description
NAICS Category
NAICS
Code
NAICS Code Definition
Agriculture and
Crop Support
Activities
Support Activities For
Agriculture and Forestry
(115)
115112
Soil Preparation, Planting, and Cultivating
115113
Crop Harvesting, Primarily By Machine
115114
Postharvest Crop Activities (Except Cotton Ginning)
Arts,
Entertainment,
and Recreation
Arts, Entertainment, and
Recreation (71)
711310
Promoters Of Performing Arts, Sports, and Similar
Events With Facilities
713940
Fitness and Recreational Sports Centers
Beverage and
Ice
Manufacturing
Beverage Manufacturing
(312)
312111
Soft Drink Manufacturing
312112
Bottled Water Manufacturing
312113
Ice Manufacturing
312120
Breweries
312130
Wineries
Durable Goods
Wholesalers and
Dealers
Merchant Wholesalers -
Durable Goods (423)
423410
Photographic Equipment and Supplies Merchant
Wholesalers
423740
Refrigeration Equipment and Supplies Merchant
Wholesalers
423990
Other Miscellaneous Durable Goods Merchant
Wholesalers
Educational
Services
Educational Services
(611)
611110
Elementary and Secondary Schools
611210
Junior Colleges
611310
Colleges, Universities, and Professional Schools
Food
Manufacturing
Food Manufacturing
(311)
311111
Dog and Cat Food Manufacturing
311119
Other Animal Food Manufacturing
311211
Flour Milling
311212
Rice Milling
311213
Malt Manufacturing
311221
Wet Corn Milling
311224
Soybean and Other Oilseed Processing
311225
Fats and Oils Refining and Blending
139
-------
140
-------
Sector
Description
NAICS Category
NAICS
Code
NAICS Code Definition
311920
Coffee and Tea Manufacturing
311930
Flavoring Syrup and Concentrate Manufacturing
311941
Mayonnaise, Dressing, and Other Prepared Sauce
Manufacturing
311942
Spice and Extract Manufacturing
311991
Perishable Prepared Food Manufacturing
311999
All Other Miscellaneous Food Manufacturing
General
Merchandise
Stores
General Merchandise
Stores (452)
452210
Department Stores
452319
All Other General Merchandise Stores
All Other Miscellaneous
Store Retailers (Except
Tobacco Stores)
(453998)
453998
All Other Miscellaneous Store Retailers (Except
Tobacco Stores)
Grocery and
Specialty Food
Stores
Grocery and
Convenience Retailers
(4451)
445110
Supermarkets and Other Grocery (Except Convenience)
Stores
445131
Convenience Retailers
Specialty Food Stores
(4452)
445240
Meat Markets
445230
Fruit and Vegetable Markets
445299
All Other Specialty Food Stores
Food Service
Contractors (72231)
722310
Food Service Contractors
Hospitals
Hospitals (622)
622110
General Medical and Surgical Hospitals
Mining,
Quarrying, and
Oil and Gas
Extraction
Oil and Gas Extraction
(211)
211120
Crude Petroleum Extraction
211130
Natural Gas Extraction
Non-Durable
Goods
Wholesalers and
Dealers
Merchant Wholesalers -
Non-Durable Goods
(424)
424210
Drugs and Druggists' Sundries Merchant Wholesalers
424410
General Line Grocery Merchant Wholesalers
424420
Packaged Frozen Food Merchant Wholesalers
424430
Dairy Product (Except Dried Or Canned) Merchant
Wholesalers
424440
Poultry and Poultry Product Merchant Wholesalers
141
-------
Sector
Description
NAICS Category
NAICS
Code
NAICS Code Definition
424460
Fish and Seafood Merchant Wholesalers
424470
Meat and Meat Product Merchant Wholesalers
424480
Fresh Fruit and Vegetable Merchant Wholesalers
424490
Other Grocery and Related Products Merchant
Wholesalers
424590
Other Farm Product Raw Material Merchant Wholesalers
424710
Petroleum Bulk Stations and Terminals
424810
Beer and Ale Merchant Wholesalers
424930
Flower, Nursery Stock, and Florists' Supplies Merchant
Wholesalers
Non-Food
Manufacturing
Paper Manufacturing
(322)
322121
Paper (Except Newsprint) Mills
322211
Corrugated and Solid Fiber Box Manufacturing
322220
Paper Bag and Coated and Treated Paper Manufacturing
Printing and Related
Support Activities (323)
323111
Commercial Printing (Except Screen and Books)
Petroleum
Manufacturing (324)
324110
Petroleum Refineries
Chemical Manufacturing
(325)
325120
Industrial Gas Manufacturing
325180
Other Basic Inorganic Chemical Manufacturing
325211
Plastics Material and Resin Manufacturing
325320
Pesticide and Other Agricultural Chemical
Manufacturing
325620
Toilet Preparation Manufacturing
325991
Custom Compounding Of Purchased Resins
325998
All Other Miscellaneous Chemical Product and
Preparation Manufacturing
Pharmaceutical
Manufacturing (3254)
325412
Pharmaceutical Preparation Manufacturing
325413
In-Vitro Diagnostic Substance Manufacturing
325414
Biological Product (Except Diagnostic) Manufacturing
Plastics and Rubber
Manufacturing (326)
326122
Plastics Pipe and Pipe Fitting Manufacturing
326140
Polystyrene Foam Product Manufacturing
326160
Plastics Bottle Manufacturing
142
-------
143
-------
Sector
Description
Office
Buildings
NAICS Category
NAICS
Code
NAICS Code Definition
Publishing Industries
(Except Internet) (511)
511110
Newspaper Publishers
511120
Periodical Publishers
511130
Book Publishers
511140
Directory and Mailing List Publishers
511191
Greeting Card Publishers
511199
All Other Publishers
511210
Software Publishers
Motion Picture and
Video Industries (512)
512110
Motion Picture and Video Production
512120
Motion Picture and Video Distribution
512131
Motion Picture Theaters (Except Drive-Ins)
512132
Drive-In Motion Picture Theaters
512191
Teleproduction and Other Postproduction Services
512199
Other Motion Picture and Video Industries
512250
Record Production and Distribution
512230
Music Publishers
512240
Sound Recording Studios
512290
Other Sound Recording Industries
Broadcasting (515)
515111
Radio Networks
515112
Radio Stations
515120
Television Broadcasting
515210
Cable and Other Subscription Programming
T elecommunications
(517)
517311
Wired Telecommunications Carriers
517312
Wireless Telecommunications Carriers (Except Satellite)
517410
Satellite Telecommunications
51791
Other Telecommunications
Data Processing,
Hosting, and Related
Services (518)
518210
Data Processing, Hosting, and Related Services
Libraries and Archives
(519)
519120
Libraries and Archives
522220
Sales Financing
522291
Consumer Lending
144
-------
145
-------
146
-------
147
-------
148
-------
Sector
Description
NAICS Category
NAICS
Code
NAICS Code Definition
722515
Snack and Nonalcoholic Beverage Bars
813110
Religious Organizations
813211
Grantmaking Foundations
813212
Voluntary Health Organizations
813219
Other Grantmaking and Giving Services
813311
Human Rights Organizations
Religious, Grantmaking,
813312
Environment, Conservation and Wildlife Organizations
Civic, Professional, and
813319
Other Social Advocacy Organizations
Similar Organizations
813410
Civic and Social Organizations
(813)
813910
Business Associations
813920
Professional Organizations
813930
Labor Unions and Similar Labor Organizations
813940
Political Organizations
813990
Other Similar Organizations (Except Business,
Professional, Labor, and Political Organizations)
Public Administration
92
Public Administration
484220
Specialized Freight (Except Used Goods) Trucking,
Transportation and
Warehousing (48)
Local
488119
Other Airport Operations
488510
Freight Transportation Arrangement
488991
Packing and Crating
Other
Scheduled Air
Transportation (4811)
481112
Scheduled Freight Air Transportation
Warehousing,
Rail Transportation
482111
Line-Haul Railroads
Storage, and
(482)
482112
Short Line Railroads
Transportation
Water Transportation
(483)
483111
Deep Sea Freight Transportation
483113
Coastal and Great Lakes Freight Transportation
483211
Inland Water Freight Transportation
Truck Transportation
(484)
484110
General Freight Trucking, Local
484121
General Freight Trucking, Long-Distance, Truckload
484122
General Freight Trucking, Long-Distance, Less Than
Truckload
149
-------
Sector
Description
NAICS Category
NAICS
Code
NAICS Code Definition
484220
Specialized Freight (except Used Goods) Trucking,
Local
484230
Specialized Freight (except Used Goods) Trucking,
Long-Distance
Warehousing and
Storage (4931)
493110
General Warehousing and Storage
493130
Farm Product Warehousing and Storage
493190
Other Warehousing and Storage
Refrigerated
Warehousing
and Storage
Refrigerated
Warehousing and
Storage (49312)
493120
Refrigerated Warehousing and Storage
Research and
Development
Research and
Development (5417)
54171
Research and Development In The Physical, Engineering
and Life Sciences
Retail Trade
Gasoline Stations and
Fuel Dealers (457)
457110
Gasoline Stations with Convenience Stores
Utilities
Utilities (221)
221111
Hydroelectric Power Generation
221112
Fossil Fuel Electric Power Generation
221113
Nuclear Electric Power Generation
221114
Solar Electric Power Generation
221115
Wind Electric Power Generation
221116
Geothennal Electric Power Generation
221117
Biomass Electric Power Generation
221118
Other Electric Power Generation
221121
Electric Bulk Power Transmission and Control
221122
Electric Power Distribution
221210
Natural Gas Distribution
221310
Water Supply and Irrigation Systems
221320
Sewage Treatment Facilities
221330
Steam and Air-Conditioning Supply
Warehouse
Clubs and
Supercenters
Warehouse Clubs and
Supercenters (45231)
452311
Warehouse Clubs and Supercenters
150
-------
151
-------
Appendix J. Annual SC-HFC Estimates
Note that the tables in this appendix are replicated from Appendix E in the Allocation Framework Rule
RIA.
Table J-l: SC-HFC-32 (2020$)
Discount rate and statistic
Year
2.5%
3%
3% 95th
Percentile
5%
2020
49786.59
38382.85
101492.44
18352.27
2021
51413.109
39762.257
105300.205
19177.965
2022
53039.625
41141.666
109107.972
20003.655
2023
54666.141
42521.076
112915.739
20829.346
2024
56292.657
43900.486
116723.505
21655.036
2025
57919.173
45279.895
120531.272
22480.727
2026
59668.379
46770.953
124530.702
23384.736
2027
61417.586
48262.010
128530.133
24288.746
2028
63166.793
49753.068
132529.563
25192.755
2029
64916.000
51244.125
136528.993
26096.764
2030
66665.207
52735.183
140528.424
27000.774
2031
68704.221
54500.880
145708.294
28120.592
2032
70743.235
56266.578
150888.165
29240.411
2033
72782.249
58032.275
156068.035
30360.229
2034
74821.262
59797.972
161247.906
31480.048
2035
76860.276
61563.670
166427.777
32599.866
2036
79039.580
63453.666
171852.464
33805.174
2037
81218.884
65343.662
177277.151
35010.483
2038
83398.188
67233.659
182701.838
36215.792
2039
85577.491
69123.655
188126.525
37421.100
2040
87756.795
71013.652
193551.212
38626.409
2041
90054.034
73050.354
199639.692
40012.789
2042
92351.273
75087.056
205728.172
41399.170
2043
94648.512
77123.758
211816.651
42785.551
2044
96945.751
79160.460
217905.131
44171.931
2045
99242.990
81197.162
223993.611
45558.312
2046
101685.333
83363.003
229987.399
47034.247
2047
104127.677
85528.844
235981.188
48510.182
2048
106570.020
87694.685
241974.976
49986.118
2049
109012.364
89860.526
247968.764
51462.053
152
-------
Table J-2: SC-HFC-125 (2020$)
Discount rate and statistic
Year
2.5%
3%
3% 95th
Percentile
5%
2020
287355.72
210911.81
551978.95
82898.26
2021
294887.556
217085.503
569594.501
86120.505
2022
302419.397
223259.193
587210.048
89342.751
2023
309951.238
229432.882
604825.595
92564.996
2024
317483.079
235606.572
622441.142
95787.241
2025
325014.920
241780.261
640056.689
99009.487
2026
333092.365
248424.768
657741.554
102515.118
2027
341169.809
255069.275
675426.418
106020.750
2028
349247.254
261713.782
693111.283
109526.382
2029
357324.698
268358.289
710796.148
113032.013
2030
365402.142
275002.796
728481.012
116537.645
2031
373919.994
282163.781
748470.546
120583.985
2032
382437.846
289324.765
768460.080
124630.326
2033
390955.698
296485.750
788449.614
128676.666
2034
399473.550
303646.735
808439.148
132723.006
2035
407991.402
310807.719
828428.682
136769.347
2036
417251.781
318564.552
849636.684
141137.117
2037
426512.159
326321.385
870844.685
145504.888
2038
435772.537
334078.219
892052.687
149872.658
2039
445032.916
341835.052
913260.688
154240.429
2040
454293.294
349591.885
934468.690
158608.199
2041
463371.229
357367.866
955473.401
163321.348
2042
472449.163
365143.847
976478.111
168034.498
2043
481527.097
372919.828
997482.822
172747.647
2044
490605.032
380695.809
1018487.533
177460.797
2045
499682.966
388471.790
1039492.244
182173.946
2046
509191.467
396671.327
1060081.206
187192.272
2047
518699.968
404870.864
1080670.168
192210.597
2048
528208.468
413070.400
1101259.130
197228.922
2049
537716.969
421269.937
1121848.092
202247.248
2050
547225.470
429469.474
1142437.054
207265.573
153
-------
Table J-3: SC-HFC-134ci (2020$)
Discount rate and statistic
Year
2.5%
3%
3% 95th
Percentile
5%
2020
115195.66
87119.97
228428.24
38251.06
2021
118631.241
89985.780
236470.182
39855.749
2022
122066.820
92851.589
244512.121
41460.442
2023
125502.399
95717.398
252554.059
43065.136
2024
128937.977
98583.206
260595.998
44669.829
2025
132373.556
101449.015
268637.937
46274.522
2026
136095.427
104560.437
277134.079
48030.441
2027
139817.297
107671.858
285630.222
49786.361
2028
143539.168
110783.280
294126.365
51542.280
2029
147261.038
113894.701
302622.507
53298.200
2030
150982.909
117006.122
311118.650
55054.119
2031
155005.633
120437.385
320909.232
57112.544
2032
159028.356
123868.648
330699.814
59170.968
2033
163051.080
127299.910
340490.396
61229.393
2034
167073.804
130731.173
350280.978
63287.817
2035
171096.528
134162.436
360071.560
65346.242
2036
175389.925
137836.695
370127.217
67566.620
2037
179683.323
141510.954
380182.874
69786.999
2038
183976.720
145185.214
390238.532
72007.377
2039
188270.117
148859.473
400294.189
74227.755
2040
192563.514
152533.732
410349.846
76448.134
2041
196659.573
156123.295
419827.206
78783.486
2042
200755.632
159712.859
429304.565
81118.839
2043
204851.691
163302.422
438781.925
83454.191
2044
208947.750
166891.985
448259.285
85789.543
2045
213043.809
170481.549
457736.644
88124.896
2046
217389.754
174299.885
467468.878
90619.705
2047
221735.699
178118.221
477201.111
93114.514
2048
226081.644
181936.558
486933.344
95609.324
2049
230427.590
185754.894
496665.577
98104.133
2050
234773.535
189573.230
506397.811
100598.942
154
-------
Table J-4: SC-HFC-143a (2020$)
Discount rate and statistic
Year
2.5%
3%
3% 95th
Percentile
5%
2020
376193.35
267248.70
699659.97
94760.56
2021
385135.835
274417.932
720658.392
98266.435
2022
394078.320
281587.166
741656.813
101772.315
2023
403020.806
288756.399
762655.234
105278.195
2024
411963.291
295925.632
783653.655
108784.074
2025
420905.777
303094.866
804652.076
112289.954
2026
430387.114
310744.202
824860.325
116084.243
2027
439868.451
318393.538
845068.575
119878.532
2028
449349.789
326042.873
865276.824
123672.821
2029
458831.126
333692.209
885485.074
127467.109
2030
468312.464
341341.545
905693.323
131261.398
2031
478233.222
349525.185
927712.023
135636.429
2032
488153.980
357708.824
949730.723
140011.459
2033
498074.738
365892.464
971749.423
144386.489
2034
507995.497
374076.103
993768.122
148761.520
2035
517916.255
382259.743
1015786.822
153136.550
2036
528472.557
390986.280
1038786.095
157824.770
2037
539028.859
399712.818
1061785.367
162512.990
2038
549585.161
408439.355
1084784.640
167201.210
2039
560141.463
417165.892
1107783.912
171889.431
2040
570697.765
425892.430
1130783.185
176577.651
2041
581211.345
434775.654
1155302.921
181741.799
2042
591724.925
443658.878
1179822.656
186905.946
2043
602238.506
452542.102
1204342.392
192070.094
2044
612752.086
461425.325
1228862.128
197234.242
2045
623265.667
470308.549
1253381.863
202398.390
2046
634393.420
479730.705
1279066.864
207892.147
2047
645521.173
489152.860
1304751.864
213385.904
2048
656648.926
498575.015
1330436.864
218879.662
2049
667776.679
507997.171
1356121.864
224373.419
2050
678904.432
517419.326
1381806.865
229867.176
155
-------
Table J-5: SC-HFC-152a (2020$)
Discount rate and statistic
Year
2.5%
3%
3% 95th
Percentile
5%
2020
6928.87
5359.89
14161.65
2624.61
2021
7156.181
5553.929
14701.064
2743.788
2022
7383.489
5747.968
15240.479
2862.965
2023
7610.797
5942.007
15779.895
2982.142
2024
7838.105
6136.046
16319.310
3101.319
2025
8065.412
6330.085
16858.726
3220.497
2026
8311.446
6540.784
17413.200
3351.178
2027
8557.479
6751.482
17967.675
3481.860
2028
8803.513
6962.181
18522.149
3612.542
2029
9049.546
7172.879
19076.624
3743.223
2030
9295.580
7383.578
19631.099
3873.905
2031
9585.902
7636.208
20372.275
4037.234
2032
9876.225
7888.838
21113.452
4200.563
2033
10166.548
8141.468
21854.629
4363.891
2034
10456.871
8394.098
22595.806
4527.220
2035
10747.194
8646.728
23336.983
4690.548
2036
11057.865
8917.251
24105.852
4866.255
2037
11368.537
9187.774
24874.721
5041.962
2038
11679.209
9458.297
25643.590
5217.668
2039
11989.880
9728.820
26412.458
5393.375
2040
12300.552
9999.343
27181.327
5569.081
2041
12670.904
10326.176
28217.415
5790.383
2042
13041.256
10653.009
29253.503
6011.685
2043
13411.608
10979.842
30289.591
6232.987
2044
13781.960
11306.676
31325.678
6454.288
2045
14152.312
11633.509
32361.766
6675.590
2046
14542.565
11978.535
33387.545
6909.980
2047
14932.817
12323.562
34413.324
7144.371
2048
15323.070
12668.589
35439.104
7378.761
2049
15713.322
13013.615
36464.883
7613.151
2050
16103.575
13358.642
37490.662
7847.542
Table J-6: SC-HFC-227ea (2020$)
Year Discount rate and statistic
156
-------
2.5%
3%
3% 95th
Percentile
5%
2020
265356.49
193089.64
506009.35
73736.77
2021
272110.248
198595.466
521308.516
76559.579
2022
278864.004
204101.296
536607.681
79382.390
2023
285617.761
209607.126
551906.846
82205.201
2024
292371.518
215112.956
567206.011
85028.012
2025
299125.275
220618.786
582505.176
87850.823
2026
306344.044
226530.215
598382.520
90917.832
2027
313562.813
232441.643
614259.863
93984.842
2028
320781.582
238353.072
630137.207
97051.852
2029
328000.351
244264.500
646014.550
100118.861
2030
335219.120
250175.928
661891.893
103185.871
2031
342806.814
256528.702
679511.654
106723.214
2032
350394.508
262881.476
697131.415
110260.557
2033
357982.202
269234.249
714751.177
113797.900
2034
365569.896
275587.023
732370.938
117335.243
2035
373157.590
281939.796
749990.699
120872.586
2036
381305.447
288757.900
768267.650
124675.878
2037
389453.303
295576.004
786544.602
128479.170
2038
397601.160
302394.107
804821.553
132282.462
2039
405749.017
309212.211
823098.505
136085.755
2040
413896.874
316030.314
841375.456
139889.047
2041
421916.693
322894.341
858948.745
144016.673
2042
429936.512
329758.368
876522.034
148144.299
2043
437956.331
336622.395
894095.323
152271.926
2044
445976.150
343486.421
911668.612
156399.552
2045
453995.969
350350.448
929241.901
160527.178
2046
462537.979
357669.454
948617.279
164934.047
2047
471079.989
364988.461
967992.657
169340.916
2048
479621.999
372307.467
987368.035
173747.785
2049
488164.010
379626.473
1006743.413
178154.654
2050
496706.020
386945.480
1026118.791
182561.522
Table J-7: SC-HFC-236/a (2020$)
Discount rate and statistic
Year
2.5%
3%
3% 95th
Percentile
5%
157
-------
2020
971911.32
635691.68 1671593.41 182719.62
2021 990966.334 650225.941 1712939.154 189003.615
2022
1010021.351
664760.197
1754284.899
195287.611
2023
1029076.368
679294.453
1795630.645
201571.608
2024
1048131.384
693828.709
1836976.391
207855.604
2025
1067186.401
708362.965
1878322.137
214139.600
2026
1087374.004
723836.127
1920231.244
220906.135
2027
1107561.607
739309.289
1962140.352
227672.670
2028
1127749.210
754782.450
2004049.460
234439.205
2029
1147936.813
770255.612
2045958.567
241205.740
2030
1168124.416
785728.774
2087867.675
247972.275
2031
1189329.895
802305.367
2136403.703
255826.244
2032
1210535.374
818881.960
2184939.731
263680.213
2033
1231740.853
835458.553
2233475.759
271534.182
2034
1252946.332
852035.146
2282011.786
279388.152
2035
1274151.811
868611.739
2330547.814
287242.121
2036
1296438.782
886109.188
2381068.457
295594.550
2037
1318725.754
903606.638
2431589.100
303946.979
2038
1341012.726
921104.088
2482109.743
312299.409
2039
1363299.698
938601.538
2532630.386
320651.838
2040
1385586.670
956098.988
2583151.028
329004.267
2041
1408441.699
974359.583
2635485.726
338463.005
2042
1431296.727
992620.177
2687820.423
347921.743
2043
1454151.756
1010880.772
2740155.121
357380.481
2044
1477006.785
1029141.366
2792489.818
366839.219
2045
1499861.814
1047401.961
2844824.516
376297.957
2046
1523747.327
1066577.257
2898382.352
386286.778
2047
1547632.840
1085752.553
2951940.189
396275.599
2048
1571518.353
1104927.849
3005498.026
406264.421
2049
1595403.866
1124103.145
3059055.863
416253.242
2050
1619289.379
1143278.441
3112613.700
426242.064
158
-------
Table J-8: SC-HFC-245fa (2020$)
Discount rate and statistic
Year
2.5%
3%
3% 95th
Percentile
5%
2020
79920.92
61300.90
161390.69
28587.55
2021
82459.557
63446.648
167363.131
29847.970
2022
84998.191
65592.394
173335.569
31108.389
2023
87536.826
67738.140
179308.007
32368.807
2024
90075.460
69883.886
185280.445
33629.226
2025
92614.095
72029.632
191252.883
34889.645
2026
95356.029
74354.956
197500.284
36269.117
2027
98097.963
76680.280
203747.684
37648.589
2028
100839.897
79005.603
209995.085
39028.061
2029
103581.831
81330.927
216242.485
40407.533
2030
106323.765
83656.250
222489.886
41787.005
2031
109426.575
86333.922
230330.054
43460.060
2032
112529.385
89011.593
238170.222
45133.114
2033
115632.195
91689.265
246010.390
46806.169
2034
118735.005
94366.936
253850.558
48479.224
2035
121837.815
97044.608
261690.726
50152.278
2036
125196.978
99939.251
269867.222
51961.200
2037
128556.141
102833.894
278043.717
53770.121
2038
131915.305
105728.538
286220.213
55579.043
2039
135274.468
108623.181
294396.709
57387.965
2040
138633.631
111517.824
302573.204
59196.886
2041
141916.845
114417.253
310725.593
61151.160
2042
145200.059
117316.683
318877.982
63105.433
2043
148483.273
120216.112
327030.370
65059.707
2044
151766.487
123115.542
335182.759
67013.980
2045
155049.701
126014.971
343335.148
68968.254
2046
158589.120
129137.145
351770.865
71067.545
2047
162128.539
132259.319
360206.582
73166.836
2048
165667.957
135381.493
368642.300
75266.127
2049
169207.376
138503.667
377078.017
77365.418
2050
172746.795
141625.840
385513.735
79464.709
159
-------
Table J-9: SC-HFC-43-lOmee (2020$)
Discount rate and statistic
Year
2.5%
3%
3% 95th
Percentile
5%
2020
132976.19
100136.12
262542.58
43232.49
2021
136842.827
103357.628
271504.098
45019.695
2022
140709.459
106579.132
280465.619
46806.902
2023
144576.092
109800.636
289427.140
48594.110
2024
148442.724
113022.139
298388.661
50381.318
2025
152309.357
116243.643
307350.182
52168.526
2026
156513.011
119747.938
317037.761
54124.231
2027
160716.666
123252.233
326725.339
56079.936
2028
164920.320
126756.528
336412.918
58035.642
2029
169123.975
130260.823
346100.496
59991.347
2030
173327.629
133765.118
355788.075
61947.052
2031
177841.943
137606.700
366655.119
64229.658
2032
182356.257
141448.282
377522.163
66512.263
2033
186870.571
145289.863
388389.206
68794.869
2034
191384.885
149131.445
399256.250
71077.474
2035
195899.199
152973.026
410123.294
73360.080
2036
200701.567
157076.690
421305.310
75819.959
2037
205503.935
161180.355
432487.326
78279.838
2038
210306.303
165284.019
443669.342
80739.717
2039
215108.671
169387.683
454851.358
83199.596
2040
219911.039
173491.347
466033.374
85659.475
2041
224514.092
177516.883
476545.962
88252.826
2042
229117.145
181542.419
487058.550
90846.177
2043
233720.198
185567.956
497571.138
93439.528
2044
238323.251
189593.492
508083.726
96032.878
2045
242926.304
193619.028
518596.314
98626.229
2046
247831.642
197913.424
529594.395
101398.496
2047
252736.980
202207.819
540592.477
104170.763
2048
257642.319
206502.215
551590.559
106943.030
2049
262547.657
210796.610
562588.641
109715.298
2050
267452.996
215091.006
573586.723
112487.565
160
-------
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
Table J-10: SC-HFC-23 (2020$)
Discount rate and statistic
3% 95th
2.5% 3% Percentile 5%
1483435.899 965975.482 2566380.066 274829.362
15123347175 987952030 26284617987 284763718
1541232452 10099287578 26905437907 2936987075
1570T30:728 10379057726 27526257827 767732477
1599029^004 l7)5388"i7674 2814707747 77725 667788
16279277280 17)758587222 28767897667 3220077l45
1658460740 17)992097337 29409997970 3327557387
16889947199 l"l2256()7453 777)052767272 3423097629
77795277659 77779777768 3069420575 352463787]"
77500617778 7769762683 7737637877 3626787777
77867947578 7792677 798 77978477780 372772356
78726787086 72776527779 32716097673 7845777577
78448077595 7242697960 77457787766 396370786
78769057704 72677297547 74777467660 4087767677
79096787677 77977687722 74979757753 419969216
7947777777 7777867767 75666877647 4777687477
7974899788 7344277788 7642777730 444342072
76086877454 7776747677 77786777874 4569757777
20474757777 77972787759 77977657897 46 9 4 8973 54
76762627788 74776887644 78694597987 482062995
7776057455 74567597730 7947754 065 4946367636
77447757499 747778877348 4676267523 767872690
7779787542 77674777766 47677567982 777767744
7774047786 77776467785 47887687447 7773447798
7747777630 75606767003 4769757899 777787852
2787777674 7788767227 47764777778 5658167905
27777957263 76172987716 4477292967 5808297914
2777874 857 76462977877 45777747775 595842922
2792634442 7677287706 45997567784 6108557937
24782547672 77642787477 46779377793 6258687939
2464477627 77777777696 4764877 477 6408877948
161
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Appendix K. Marginal Abatement Cost Curve MACC Analysis of Provisions
Contained in the Proposed Rule
Introduction to Supplementary MACC Analysis
Background
This appendix applies an assessment of the costs and benefits of a subset of provisions contained in the
proposed rule using an alternative methodology. This appendix has been prepared as a supplement to
principal costs benefits detailed earlier in this draft RIA Addendum, and utilizes a Marginal Abatement
Cost Curve (MACC) methodology that has been used for previous analyses for the estimation of costs
and benefits for final rules issued separately under the AIM Act, Phasedown ofHydrofluorocarbons:
Establishing the Allowance Allocation and Trading Program Under the American Innovation and
Manufacturing Act (Allocation Framework Rule, 86 FR55116, October 5, 2021), and Phasedown of
Hydrofluorocarbons: Allowance Allocation Methodology for 2024 and Later Years (88 FR 46836, July
20, 2023) (referred to in this appendix as the Allocation Rule and 2024 Allocation Rule, respectively, or
collectively as the "Allocation Rules"). Employing this methodology allows for comparability with EPA's
prior estimates of the costs and benefits of the HFC phasedown.
Differences in the estimated costs and benefits of specific provisions detailed in the above sections of this
draft RIA Addendum compared to those presented in this appendix are related to methodological
differences described in more detail in the sections below. At this time, EPA is presenting the results
contained in this appendix as a supplementary analysis, and may revisit the assumptions used to develop
the estimates presented in this appendix at a later date. Furthermore, while the analysis detailed below is
currently considered to be supplementary, EPA may—upon review of public comments, available
information, and technical expertise —use some or all of the methods described in this analysis for its
principal costs/benefits estimates for the final subsection (h) rule.
Relationship to Allocation Framework Rule and 2024 Allocation Rule RIA Results
As discussed in section 3 of this draft RIA Addendum, EPA has previously estimated costs and benefits
of the HFC phasedown, which are detailed in the Allocation Framework RIA and 2024 Allocation Rule
RIA Addendum. In order to avoid double counting or overestimating of costs and benefits of the proposed
action, for the purposes of this supplementary analysis the Allocation Rules are assumed to be the status
quo from which incremental benefits may be calculated.
162
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As with the estimates detailed earlier in this draft RIA Addendum, this supplementary analysis finds that
requirements contained in the proposed rule may drive additional HFC consumption and emissions
reductions beyond those previously assumed by EPA in its evaluation of the Allocation Rules.
However—given that compliance with the HFC phasedown is met via a tradeable allowance system—
these additional reductions may be offset by the "freeing up" of allowances for other subsectors.
Ultimately, the extent of these potential offsetting effects is uncertain. Given this, and consistent with the
approach taken elsewhere in this draft RIA Addendum, this supplementary analysis provides two
scenarios to illustrate the range of potential incremental environmental impacts: a "base case" and a "high
additionality case." In the base case scenario it is assumed that additional consumption reductions from
this rule's requirements will be offset by the use of consumption allowances to meet demand in other
subsectors. By contrast, in the "high additionality" it is assumed that additional consumption reductions
resulting from this rule's provisions are fully additional to EPA's previous estimates in the Allocation
Rule Reference Case (i.e., previously assumed consumption reduction options do not "backslide" or
decrease in response to this rule).
Compliance Costs Evaluated
As detailed further in this appendix, EPA developed an updated MACC methodology to evaluate the
following provisions contained in the proposed subsection (h) Rule:
• Leak inspection and leak repair requirements
• Use of automatic leak detection systems for CR and IPR appliances containing 1,500
pounds or more of refrigerant
• Use of reclaimed refrigerant for new equipment and/or servicing of specific RACHP
appliances
• Requirements for the servicing, repair, disposal, or installation of fire suppression
equipment
This analysis only evaluates costs (and benefits) associated with proposed Rule provisions that have been
evaluated using EPA's Vintaging Model and MACC methodology. Provisions contained in the proposed
Rule not evaluated using these methods include:
• Recordkeeping and reporting requirements
• Requirements pertaining to the management and tracking of cylinders of refrigerants and fire
suppressants
• Alternative Resource Conservation and Recovery Act (RCRA) standards for spent ignitable
refrigerants being recycled for reuse
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Estimates of the costs and benefits of these provisions may be found in section 4 of this draft RIA
Addendum.
Climate Benefits Evaluated
As with other analyses conducted by EPA for final and proposed AIM Act regulations, environmental
benefits evaluated in this supplementary analysis derive from preventing the emissions of HFCs with high
GWPs, thus reducing the damage from climate change that would have been induced by those emissions.
Additional details on the climate impacts of HFCs and EPA's methodology for estimating the monetized
benefits of reducing HFC emissions can be found in section 4.5 of this draft RIA Addendum and chapter
4 of the Allocation Rule RIA.
Factors Analyzed
This supplementary analysis takes into consideration the costs to meet proposed requirements and the
environmental impacts of the consequent reduction in HFC consumption and emissions. As explained in
the Allocation Framework RIA, specific factors evaluated in this assessment include capital costs,
operations and maintenance (O&M) costs, and savings from avoiding refrigerant loss.
In addition, through the use of EPA's Vintaging Model and MACC methodology, this analysis takes into
account multiple factors which are not incorporated into the principal costs and benefits estimates
provided earlier in this draft RIA Addendum. These include: a) cost savings from an updated compliance
pathway to meeting the HFC phasedown (relative to the Allocation Rule Reference case pathway); and b)
additional emissions reductions from enhanced HFC recovery. These methodological differences and
details on factors considered in this analysis are discussed in more detail in chapters 4, 5, and 6 of this
document.
164
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Compliance Costs
Modeling Method for Costs
To generate cost estimates for compliance with the proposed rule's provisions, EPA relied on a
methodology consistent with the approach used in the Allocation Framework RIA (see Section 3.2 of the
Allocation Framework RIA). As before, abatement options were used to estimate the consumption and
emission reductions, the costs, and the societal benefits associated with compliance. Additional abatement
options were evaluated and developed in order to model specific industry requirements contained in the
proposed rule.
Abatement Options Modeled
Requirements contained in the proposed rule pertaining to leak repair, ALD, fire suppression, and
reclamation were modeled as abatement options on a dollars-per-ton of avoided consumption basis. As
discussed in the Allocation Rule RIA, abatement options can stem from a variety of compliance
strategies, including reducing the amount of HFCs used in apiece of equipment (e.g., lowering charge
sizes), and transitioning from using HFCs to alternatives such as hydrocarbons, ammonia, and
hydrofluoroolefins (HFOs) or HFO blends. To model the specific requirements of the proposed rule, EPA
evaluated abatement options falling into the following two general categories:
• reduce the amount needed for service (e.g., repair leaks)
• recover and reuse HFCs when equipment is decommissioned and disposed.
Error! Reference source not found, below provides a summary of abatement strategies modeled to
evaluate the impact of the specific subsection (h) rule requirements. For each abatement option modeled,
total net costs associated with the strategy (e.g., leak detection costs minus any anticipated savings) are
divided by the total amount of avoided HFC consumption to derive a cost estimate on a dollars-per-ton
basis. Based on this approach, the average dollar-per-ton "break even" cost tends to be higher for larger
appliances or subsectors with large charge sizes, as opposed to smaller pieces of equipment where the
amount of tons avoided is far lower. For example, leak repair of large IPR systems has an estimated
abatement cost of approximately $1 per ton, whereas leak repair of medium IPR systems has an estimated
abatement cost of approximately $37 per ton. Annexes A and B contain additional details on all
abatement options develop and modeled for the proposed rule as well as their assumed break-even
abatement costs in dollars per ton.
165
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Table K-l: Summary of abatement strategies modeled and key factors evaluated to derive MAC
estimates
Type of
abatement
strategy
modeled
Corresponding requirements in proposed rule
Key Factors Evaluated to develop
MAC abatement option
Reduction in
amount ofHFCs
emissions
• Leak detection and repair for equipment
containing 15 lbs or more of refrigerant
• Use of ALD systems for CR and IPR appliances
containing 1,500 pounds or more of HFC or
substitutes
• Venting prohibition for fire suppression
equipment
Abatement: avoided HFC
consumption required for to meet
servicing demand
Costs: conducting leak detection/
inspections and repairs; capital and
O&M costs for ALD hardware
Savings: refrigerant savings associated
with detecting and repairing leaks
earlier and avoiding emissions
Recovery and • Use of reclaimed refrigerant for new equipment Abatement: avoided virgin HFC
re-use ofHFCs for specific RACHP appliance categories consumption required to meet demand
• Use of reclaimed refrigerant for servicing for initial charge or servicing
existing equipment for specific RACHP Costs: cost of reclaimed HFCs
appliance categories Savings: avoided purchase of virgin
• Use of recovered refrigerant for initial charge of HFCs
fire suppression equipment
• Use of recovered refrigerant for re-charging fire
suppression equipment
Costs from MACC Approach
The leak repair, automatic leak detection, fire suppression, and use of reclaim provisions modeled as
MACC options each have a net cost or savings estimated per ton of CO2 equivalent consumption or
emissions abated. To evaluate the incremental cost of these provisions relative to EPA's previous analysis
conducted for the Allocation Rules, these options were compared with the MACC options previously
assumed to achieve compliance with the HFC phasedown. Given that the additional abatement options
specific to the proposed subsection (h) rule would contribute to consumption reductions necessary to
achieve the HFC phasedown, an updated MACC compliance path was generated which combines the (h)
rule options with the prior Allocation Rule options.
166
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Figures KError! Reference source not found, and KError! Reference source not found, below show
the updated cost curves relative to those from the prior analysis. In our base case scenario, we assume all
abatement options necessary to achieve the subsection (h) provisions occur, together with sufficient
abatement options from the Allocation Rule analysis to meet the statutory phasedown caps in each year.
A least-cost pathway is assumed in the base case scenario, whereby—after including the updated
subsection (h) requirements—the most expensive remaining abatement options that are not required to
achieve compliance are excluded. Since some of the updated abatement options specific to the subsection
(h) rule are more cost effective than previous abatement options included in the Allocation Rules
analyses, the resulting incremental impact of the rule is a net savings.
Figure K-l: 2024 Allocation Rule Cost Curve and Updated Cost Curve Including Subsection (h)
Provisions in 2030
S1000
c
o
U S1D0
-i—1
w
Q
U
£ S1G
4)
n
3
S1
Figure K-2: 2024 Allocation Ride Cost Curve and Updated Cost Curve Including Subsection (h)
Provisions in 2036 - Base Case Scenario
—*—
Updated MACC with subsection (h) requirements
2024 Allocation Rule MACC
Phasedown Cap Requirement
i
i
i
i
>
(7
=2=r-*
c
i
i
i
I
1
r
¦
i
i
i
i
i
50 100 150 200 250
MMTC02e
167
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—•— Updated MACC with subsection (h) requirements
$1000 ~~2024 Allocation Rule MACC
Phasedown Cap Requirement
"c
o
g $100
o
0
1 $10
1
s
S1
Using the MACC approach, the total compliance cost in each year for the modeled provisions is the sum
of the product of abatement and cost ($/ton) for all the abatement options used in that year. The estimated
annual compliance costs are presented in Error! Reference source not found, below.
Table K-2: Incremental Annual Compliance Costs of MAC Abatement Options (Billions 2022$)
Year
Total Incremental Compliance
Costs
Base Case
Total Incremental Compliance Costs
High Additionality Case
2025
-$0.22
$0.27
2030
$0.07
$0.16
2035
$0.01
$0.15
2040
-$0.32
$0.14
2045
$0.23
$0.18
2050
$0.16
$0.22
Climate Benefits
As discussed in the above sections of this draft RIA Addendum, primary benefits of this proposed rule
would derive from preventing the emissions of HFCs with higher GWPs, thus reducing the damage from
climate change that would have been induced by those emissions. A more complete discussion of climate
50 100 150 200 250 300
MMTC02e
168
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change damages and the social benefits of preventing them can be found in section 3.8 of this draft RIA
Addendum as well as sections 4.1 and 4.2 of the Allocaton Framework Rule RIA.
While there may be other benefits to phasing down HFCs, the benefits monetized in this supplementary
analysis are limited to the climate benefits of reduced HFC emissions.
Consumption and Emission Reductions
EPA's Vintaging Model is used to estimate both consumption and emissions for each regulated substance
for each generation or "vintage" of equipment in the compliance scenarios evaluated for this analysis.
Reductions in consumption (in units of MMTEVe) are calculated for a given year by summing the total
tons avoided resulting from required abatement options in the compliance pathway. Emission reductions
are similarly calculated by summing total emissions avoided across sectors/subsectors; however, these
benefits typically lag corresponding reductions in consumption since they often occur over the course of
equipment lifetime or during servicing and disposal.
Table K-3 below shows the consumption reductions by year corresponding to the subsection (h) Rule
compliance scenarios (base case and high additionality case) evaluated in this supplementary analysis,
which are compared to the Allocation Rule Reference Case to evaluate potential incremental reductions.
Table K-3: Annual Consumption Reductions in Allocation Rule Reference Case and
Supplementary Subsection (h) Compliance Scenarios
Allocation Rule
Reference Case
Subsection (h)
Base Case
Subsection (h)
High Additionality Case
Year
Consumption
Reduction
(MMTEVe)
Consumption
Reduction
(MMTEVe)
Incremental
Consumption
Reduction
(MMTEVe)
Consumption
Reduction
(MMTEVe)
Incremental
Consumption
Reduction
(MMTEVe)
2025
193
151
-42
200
7
2030
234
236
2
258
24
2035
270
276
6
285
15
2040
287
294
7
305
18
2045
285
307
22
307
21
2050
293
321
28
321
28
Total
6,924
6,993
69
7,403
479
Table K-4 below shows the emissions reductions by year corresponding to the Subsection (h) proposed
Rule compliance scenarios (base case and high additionality case), which are compared to the Allocation
Rule Reference Case to evaluate potential incremental reductions.
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Table K-4: Annual Emissions Reductions in Allocation Rule Reference Case and Supplementary
Subsection (h) Compliance Scenarios
Allocation Rule
Reference Case
Subsection (h)
Base Case
Subsection (h)
High Additionality Case
Year
Emissions
Reduction
(MMTEVe)
Emissions
Reduction
(MMTEVe)
Incremental
Emissions
Reduction
(MMTEVe)
Emissions
Reduction
(MMTEVe)
Incremental
Emissions
Reduction
(MMTEVe)
2025
92.5
95.6
3.1
96.3
3.8
2030
108.0
128.8
20.9
132.6
24.6
2035
149.7
166.9
17.2
168.0
18.4
2040
197.0
198.3
1.4
200.0
3.1
2045
223.9
226.4
2.5
226.4
2.5
2050
239.1
241.1
1.9
241.1
1.9
Total
4,433
4,603
170
4,645
212
Monetized Climate Benefits Results
170
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This analysis relies on the same methodology for calculating the social cost of HFC emissions as previous
regulatory impact analyses conducted by EPA for AIM Act regulations57 and detailed earlier in section
4.5 of this draft RIA Addendum.
To monetize the climate benefits resulting from the proposed subsection (h) rule provisions evaluated in
this supplementary analysis, the HFC emission reductions in each year (Table K-4) are multiplied by the
corresponding SC-HFC for that HFC in that year.
Table K-5 shows the undiscounted monetized incremental climate benefits from all regulated HFCs under
the base case and high additionality case, evaluated from the Allocation Rule Reference Case. When the
base case benefits are discounted to 2024 using a discount rate of 3 percent, the present value of the
incremental benefits of the proposed subsection (h) rule provisions evaluated in this analysis for 2025-
2050 are estimated to be $11.83 billion in 2020 dollars. This is equivalent to an annual incremental
benefit of $0.68 billion per year over that timeframe. Similarly, the present value of the incremental
benefits of the high additionality case from 2025-2050 are estimated to be $14.87 billion in 2020 dollars,
discounting to 2022 using a discount rate of 3 percent, with an annual incremental benefit of $0.86 billion
per year over that timeframe.
Table K-5: Discounted Monetized Climate Benefits 2025-2050 (billions of2020$)a-h-c
Year
Base Case
Incremental Climate Benefits
(billions 2020$)
High Additionality Case
Incremental Climate Benefits
(billions 2020$)
2025
$0.2
$0.3
2026
$0.2
$0.3
2027
$0.1
$0.3
2028
$0.1
$0.3
2029
$1.9
$2.2
2030
$1.8
$2.2
2031
$1.8
$2.1
2032
$1.7
$2.1
2033
$1.6
$2.0
2034
$1.8
$1.9
2035
$1.7
$1.8
2036
$0.1
$0.4
2037
$0.1
$0.4
2038
$0.0
$0.4
2039
$0.0
$0.3
2040
$0.1
$0.3
2041
$0.3
$0.3
57 Available at www,regulations, gov under Docket IDs EPA-HQ-OAR-2021-0044 and EPA-HQ-OAR-2022-0430.
171
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2042
$0.3
$0.3
2043
$0.3
$0.3
2044
$0.3
$0.3
2045
$0.3
$0.3
2046
$0.3
$0.3
2047
$0.3
$0.3
2048
$0.3
$0.3
2049
$0.3
$0.3
2050
$0.3
$0.3
PV (3% d.r.)
$11.83
$14.87
EAV (3% d.r.)
$0.68
$0.86
" Rows may not appear to add correctly due to rounding.
b The equivalent annual values of benefits are calculated over a 26-year period from 2025 to 2050.
c Climate benefits are based on changes in HFC emissions and are calculated using four different estimates of the
SC-HFCs (model average at 2.5 percent, 3 percent, and 5 percent discount rates; 95th percentile at 3 percent discount
rate). For purposes of this table, we show effects associated with the model average at a 3 percent discount rate, but
the Agency does not have a single central SC-HFC point estimate. We emphasize the importance and value of
considering the benefits calculated using all four SC-HFC estimates. A consideration of climate effects calculated
using discount rates below 3 percent, including 2 percent and lower, is also warranted when discounting
intergenerational impacts.
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Comparison of Benefits and Costs
Net Incremental Costs
This section summarizes the total incremental compliance costs (or savings) and the monetized
incremental environmental benefits detailed in the sections above to provide an assessment of the total net
incremental costs/benefits of requirements contained in the proposed rule that are evaluated in this
supplementary analysis. As described above, abatement costs for the proposed subsection (h) provisions
evaluated in this supplementary analysis were estimated using EPA's Vintaging Model and MACC
methodology, while monetized climate benefits were estimated based on EPA's SC-HFC methodology.
Table K-6 below provides annual incremental costs, benefits, and net incremental costs of the subsection
(h) rule provisions evaluated in this analysis, relative to the Allocation Rule Reference case. As shown,
the present value net incremental benefits are estimated to range from $13.5 billion in the Base Case to
$12.2 billion in the High Additionally Case, using a 3% discount rate. Present value estimates below are
provided using a 3% discount rate for climate benefits and both a 3% and 7% discount rate for
compliance costs.
Table K-6: Summary of Annual Incremental Climate Benefits, Costs, and Net Benefits in Base
Case and High Additionality Case Scenarios for the 2025-2050 Timeframe (millions of2020$,
discounted to 2022jaJlc-d
Base Case
High Additionality Case
Year
Incre-
mental
Climate
Benefits
(3%)
Annual Costs
(savings)
Net Benefits
(3% Benefits, 3%
or 7% Costs) e
Incre-
mental
Climate
Benefits
(3%)
Annual Costs
(savings)
Net Benefits
(3% Benefits, 3% or
7% Costs)e
2025
$0.24
-$0.22
$0.02
$0.29
$0.27
$0.57
2026
$0.18
-$0.31
-$0.13
$0.30
$0.21
$0.51
2027
$0.11
-$0.35
-$0.24
$0.31
$0.21
$0.52
2028
$0.05
-$0.53
-$0.47
$0.34
$0.13
$0.47
2029
$1.94
$0.05
$2.00
$2.20
$0.23
$2.44
2030
$1.83
$0.07
$1.90
$2.17
$0.22
$2.40
2031
$1.78
$0.05
$1.84
$2.15
$0.21
$2.36
2032
$1.69
$0.04
$1.74
$2.08
$0.20
$2.29
2033
$1.60
$0.03
$1.63
$2.01
$0.19
$2.20
2034
$1.83
$0.02
$1.85
$1.93
$0.19
$2.11
2035
$1.70
$0.01
$1.71
$1.81
$0.18
$1.99
2036
$0.11
-$0.37
-$0.26
$0.37
$0.13
$0.50
2037
$0.08
-$0.38
-$0.30
$0.36
$0.13
$0.50
173
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2038
$0.04
-$0.38
-$0.34
$0.36
$0.14
$0.49
2039
$0.01
-$0.39
-$0.38
$0.35
$0.14
$0.49
2040
$0.14
-$0.32
-$0.18
$0.34
$0.14
$0.48
2041
$0.30
$0.00
$0.30
$0.33
$0.14
$0.47
2042
$0.31
$0.14
$0.45
$0.31
$0.14
$0.45
2043
$0.30
$0.14
$0.44
$0.30
$0.14
$0.44
2044
$0.32
$0.22
$0.54
$0.32
$0.14
$0.46
2045
$0.30
$0.23
$0.53
$0.30
$0.15
$0.45
2046
$0.30
$0.23
$0.53
$0.30
$0.15
$0.45
2047
$0.30
$0.23
$0.53
$0.30
$0.15
$0.44
2048
$0.30
$0.23
$0.53
$0.30
$0.15
$0.45
2049
$0.26
$0.15
$0.41
$0.26
$0.15
$0.41
2050
$0.27
$0.16
$0.42
$0.27
$0.16
$0.42
Discount
rate
3%
3%
7%
3%
7%
3%
3%
7%
3%
7%
PV
$11.83
-$1.34
-$1.23
$13.17
$13.06
$14.87
$3.05
$2.03
$11.82
$12.84
EAV
$0.68
-$0.08
-$0.11
$0.76
$0.79
$0.86
$0.18
$0.18
$0.68
$1.16
a Benefits include only those related to climate. Climate benefits are based on changes in HFC emissions and are
calculated using four different estimates of the SC-HFCs (model average at 2.5 percent, 3 percent, and 5 percent
discount rates; 95th percentile at 3 percent discount rate). For purposes of this table, we show the effects associated
with the model average at a 3 percent discount rate, but the Agency does not have a single central SC-HFC point
estimate. We emphasize the importance and value of considering the benefits calculated using all four SC-HFC
estimates. A consideration of climate effects calculated using discount rates below 3 percent, including 2 percent
and lower, is also warranted when discounting intergenerational impacts.
b Rows may not appear to add correctly due to rounding.
0 The annualized present value of costs and benefits are calculated as if they occur over a 26-year period from 2025
to 2050.
d The costs presented in this table are annual estimates.
e The PV for the 7% net benefits column is found by taking the difference between the PV of climate benefits at 3%
and the PV of costs discounted at 7%. Due to the intergenerational nature of climate impacts the social rate of return
to capital, estimated to be 7% in OMB 's Circular A-4, is not appropriate for use in calculating PV of climate
benefits.
Comparison to Subsection (h) Rule RIA Addendum Results
The analyses conducted for the subsection (h) proposed Rule are highly dependent on the assumptions
made to model the proposed restrictions as well as the factors evaluated. The same is true for the
Allocation Rule Reference Case and indeed all models. For this reason, we have presented sensitivity
analyses and, in this case, an alternate methodology to explore how the potential results may change. For
instance, in the Allocation Rule Reference Case, we explored how the costs or savings might change if
the estimated abatement cost ($/ton CC^e) were either higher or lower. We also explored the effect of
alternate BAUs in the Allocation Rule RIA. In this draft RIA Addendum for the subsection (h) proposed
174
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Rule, we looked at the compliance costs under different charge size threshold for which leak inspection
and leak repair would be required, as well as the charge size and type of appliances for which ALDs
would need to be installed. Results of these sensitivities may be found in the Allocation Rule RIA and in
Appendix F of this draft RIA Addendum for the proposed subsection (h) Rule.
The alternate methodology presented in this supplementary analysis relies on a MACC analysis that
builds on the methodology used for the Allocation Rule Reference Case. This approach yields different
results and finds significantly higher incremental benefits than those estimated in the draft RIA
Addendum, which relies on statistical assumptions of various factors (e.g., charge size per equipment
type, leak rates before and after a leak event). As seen in the tables presented earlier in this document,
over the 26-year time frame analyzed, the cumulative differences can be quite large. Following we
describe key differences in the analytical approaches that lead to significant differences.
Assumptions regarding the amortization of ALD Costs
The rule proposes that certain IPR and CC equipment install an ALD system as a way to alert the owner
or operator that a refrigerant-containing equipment is leaking. The effect is that the system would be
repaired sooner than if no ALD was installed.
For the costs and benefits estimates detailed in sections 3 and 4 of this draft RIA Addendum, it is
assumed that businesses treat ALD equipment as capital assets and therefore assumed that they would be
able to access financing for the purchase of a direct ALD, if desired, for a loan tenure of five years. At an
assumed cost of capital of 9.8%, this led to an annualized equipment and installation cost in the first five
years of approximately $2,594 to $2,875. The annual Operations and Maintenance (O&M) costs for these
systems were $1,250 and $1,440, respectively. In contrast, the capital cost and installation of an indirect
ALD systems was not assumed to be financed and therefore was evaluated as a single capital cost of
$2,650 to $2,850, depending on the size of equipment monitored, in the first year only. Annual O&M
costs were estimated at $1,000 or $950, respectively.
In the MACC analysis contained in this appendix, the costs of the direct ALDs is handled differently. As
referenced the Allocation Framework RIA, the development of an abatement cost ($/ton C02e) is
simplified by assuming a single capital cost, a reoccurring annual cost, and a reoccurring annual revenue.
Therefore, to develop the abatement cost for a direct ALD, the cost of purchasing and installing the
equipment was spread over the full lifetime of the equipment. Because of the time value of money, the
resulting costs estimated for the MACC analysis in this TSD for ALD system installation is significantly
lower than the costs analyzed in the draft RIA Addendum.
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Assumptions regarding enhanced recovery of HFCs from equipment
The Allocation Reference Case was developed to achieve each step-down in HFC consumption using a
set of abatement options assumed to be available and technologically achievable during the compliance
period.58 Within this original set of abatement options, only the lowest-cost options needed to meet the
consumption cap were assumed to be undertaken during a given time frame.59 Given the level of each
step-down in consumption, compared to the consumption reductions that could be achieved during the
step-down, certain options could be needed during some years but not in other years.
One such option included in the Allocation Reference Case is pertains to the enhanced recovery of HFCs
from equipment for use as reclaimed material. EPA's MACC methodology assumes that this option—if
undertaken—results in both consumption reductions (given the use of reclaimed HFCs as opposed to
virgin HFCs) as well as emissions reductions (since it is assumed that—if not recovered—the material
would be released into the atmosphere). In the Allocation Rule Reference case, enhanced recovery was
not assumed to be undertaken by industry in certain model years where more cost-effective options were
available to meet the consumption reductions required by the phasedown steps.
In contrast, for the updated abatement pathway evaluated in this supplementary analysis it is assumed that
a) the original enhanced recovery abatement option from the Allocation Reference Case occurs in all
model years, and b) this recovery is further enhanced by an additional 1% beyond the BAU rate of
recovery (which is modeled as an additional abatement option as discussed earlier in this appendix).
These updated assumptions are incorporated in order to satisfy the use of reclaim requirements contained
in the proposed rule and translate into significant avoided cumulative HFC emissions not included in the
Allocation Rule Reference case, totaling approximately 128 MMT C02e over the 2025-2050 modeling
period. In contrast, for the principal costs and benefits estimates detailed in the above sections of this draft
RIA Addendum, these incremental avoided HFC emissions due to enhanced HFC recovery are not fully
evaluated, resulting in a significantly lower estimate of avoided HFC emissions.
Assumptions regarding compliance cost savings from alternate abatement pathway
As described earlier in this appendix, this supplementary analysis provides an updated MACC compliance
pathway to meeting the HFC phasedown, based on the incorporation of additional measures to meet the
58 More details on the set of abatement options modeled in the Allocation Rule Reference case can be found in
section 3.2.2 of the Allocation Rule RIA.
59 As discussed in section 3 of this analysis, EPA has conducted additional research and review to update the
original set of abatement options included in the Allocation Rule Reference Case to include additional measures that
meet provisions contained in the proposed subsection (h) rule. In some cases, these additional measures are more
cost-effective than prior options included in the Reference Case, resulting in a more cost-effective compliance
pathway to meeting the HFC phasedown.
176
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leak repair, ALD, use of reclaim, and fire suppression-related provisions from the proposed rule. These
additional measures are converted to abatement options on a dollars-per-ton-of-avoided HFC
consumption basis, and in some cases represent more cost-effective means of meeting the HFC
phasedown than measures originally included in the Allocation Rule Reference case. In the base case
scenario included in this supplementary analysis, this updated pathway results in a net cost savings
relative to the reference case, to the extent that more expensive abatement options are replaced by more
cost-effective options required by the proposed rule.
The resulting savings over the 2025-2050 modeling period amount to a present value of approximately
$1.4 billion, using a 3 percent discount rate. Since the principal costs and benefits estimated earlier in this
draft RIA Addendum do not utilize a comparable MACC methodology, these incremental compliance
savings were not evaluated and therefore excluded from the estimated incremental benefits.
177
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Detailed Description of Mitigation Technologies Modeled Specific to the
Subsection (h) Proposed Rule
For this supplementary analysis, updated abatement options were calculated for leak repair, ALD, use of
reclaim, and fire suppression-related provisions contained in the proposed rule for each year of the
analysis period (2025-2050). For calculating break-even costs, abatement potential was be calculated on a
consumption basis, to be comparable to the abatement options presented in the Allocation Rules RIA
analyses.
Leak repair of appliances
Abatement options for leak repair were calculated for the equipment types and sizes analyzed in the
proposed rule draft RIA Addendum, using the same approach for estimating costs and benefits. In these
options, it was assumed that emission benefits are equivalent to consumption benefits (i.e., that all
avoided refrigerant emissions associated with repairing leaks translate into avoided virgin manufacture).
Table K-7: Leak Repair abatement options added toMACC model for the subsection (h) Ride
analysis
Abatement Option Type
No.
Equipment Type
Equipment Size
1
Leak repair
School & Tour Bus AC
Sub-small
2
Leak repair
Transit Bus AC
Sub-small
3
Leak repair
Passenger Train AC
Sub-small
4
Leak repair
Chiller
Medium
5
Leak repair
Large
6
Leak repair
Modern Rail Transport
Sub-small
7
Leak repair
Vintage Rail Transport
Sub-small
8
Leak repair
Condensing Unit
Sub-small
9
Leak repair
Marine Transport
Small
10
Leak repair
Medium
11
Leak repair
Large
12
Leak repair
Rack
Medium
178
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13
Leak repair
Large
14
Leak repair
Cold Storage
Large
15
Leak repair
IPR
Medium
16
Leak repair
Large
Automatic leak detection systems
Abatement options for requiring ALD systems in existing and new systems were calculated for the
equipment types and sizes shown in table A-2. The approach for estimating capital, installation, and
O&M costs of ALD systems was based on the assumptions used in the draft RIA Addendum for the
proposed rule. The leak repair and inspection costs, refrigerant savings, and benefits of the ALD options
were associated with repairs being conducted four weeks earlier (i.e., the incremental difference between
the assumed six weeks earlier that repairs will be conducted without ALD and the 10 weeks earlier
assumed for systems using ALD monitoring, as detailed in the draft RIA Addendum) and/or systems
requiring fewer leak inspections (e.g., CR and IPR systems containing more than 1,500 pounds of
refrigerant will switch from quarterly to annual inspections).
As with the added leak repair abatement options, it was assumed that emission benefits are equivalent to
consumption benefits (i.e., that all avoided refrigerant emissions associated with repairing leaks translate
into avoided virgin manufacture).
Table K-8: ALD abatement options added toMACC model for the subsection (h) Ride analysis
Option No.
Type
Equipment Type
Equipment Size
17
ALD
Marine Transport
Medium
18
ALD
Large
19
ALD
Rack
Medium
20
ALD
Large
21
ALD
Cold Storage
Large
179
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Option No.
Type
Equipment Type
Equipment Size
22
ALD
IPR
Large
Use of reclaimed HFCs for initial charge of equipment starting January 1, 2028
In contrast with the leak repair and ALD options, abatement options for reclaim requirements was not
derived from similar estimates contained in the draft RIA Addendum. These abatement options thus
represent new costs and benefits not estimated elsewhere.
To quantify costs and benefits, a baseline for the use of reclamation in business-as-usual was first
established. This baseline was derived from HFC reclamation totals modeled in the Vintaging Model6"
relative to modeled consumption for the ref/AC sector (i.e., new chemical demand and servicing demand)
taking into account additional reclamation from the "disposal recovery" abatement option assumed in the
Allocation Rule Reference Case. This prior activity assumed in the Allocation Rule Reference case was
not included in the calculation of costs or benefits in order to avoid double counting with EPA's prior
estimates. The assumed percentage of demand met by reclaimed refrigerant in the baseline per year is
summarized in table A-3 below.
Table K-9: Baseline percentage of demand met by reclaim
Year
Baseline Percentage of Demand met by Reclaim
2028
47%
2029
49%
2030
53%
2031
56%
2032
59%
2033
62%
2034
62%
611 The Vintaging Model assumes disposal recovery from equipment reaching end-of-life in a particular year is used
to meet consumption demand for the same subsector and refrigerant (i.e., new chemical demand plus servicing
demand) in the same year (i.e., reclamation). If disposal recovery is not sufficient to meet consumption demand, the
remainder is assumed to be produced as virgin manufacture.
180
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Year
Baseline Percentage of Demand met by Reclaim
2035
60%
2036
57%
2037
52%
2038
49%
2039
46%
2040
44%
2041
44%
2042
43%
2043
43%
2044
43%
2045
35%
2046
34%
2047
32%
2048
30%
2049
25%
2050
21%
The costs and/or cost savings estimated for this activity included the refrigerant price difference in
reclaimed refrigerant vs. virgin refrigerant. For the purposes of this analysis, it was assumed that the price
of reclaimed refrigerant is 10 percent higher than virgin manufacture, but additional sensitivity analysis
can be conducted and EPA may revisit this assumption in future analyses.61
The consumption benefits of this proposed regulatory option needed to account for the proportion of
virgin manufacture that the use of reclaimed refrigerant can offset. The maximum offset would be 85
percent, to account for the use of up to 15 percent virgin material in reclaimed refrigerant. However, a
61 This baseline amount of reclaim is not accounted for in the costs/benefits of the leak repair options above (e.g., the
average refrigerant price is assumed to represent the cost of virgin refrigerant).
181
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reasonable assumption for an offset factor is expected to be lower than that maximum. Producers and
importers are likely to increase their supply of reclaimed material—while producing/importing less virgin
material—in response to end users" increasing demand for reclaimed rather than virgin material. Analysis
suggested a reasonable offset factor of 50 to 65 percent. The use of an offset factor that is lower than 85%
is a more conservative assessment of consumption benefits and assumes that the requirement to use
reclaimed refrigerant will result in a smaller reduction in HFC consumption. For example, a 50 percent
offset factor assumes that producers and importers produce/import 50 percent of the virgin refrigerant that
they otherwise would have, in the absence of the requirement to use reclaimed material. For the purposes
of this analysis, an offset factor of 65 percent was assumed. Additional sensitivity analysis can be
conducted and EPA may revisit this assumption in future analyses.
Table K-10: Initial charge reclaim abatement options added toMACC model for the subsection
(h) Ride analysis
Option No.
Type
Equipment Type
23
Initial charge - reclaim
Residential Unitary AC
24
Initial charge - reclaim
Small Commercial Unitary AC
25
Initial charge - reclaim
Large Commercial Unitary AC
26
Initial charge - reclaim
Window Units
27
Initial charge - reclaim
Packaged Terminal AC/Heat Pumps
28
Initial charge - reclaim
Ground-Source Heat Pumps
29
Initial charge - reclaim
Stand-Alone Retail Food Refrigeration
30
Initial charge - reclaim
Road Transport
31
Initial charge - reclaim
Intermodal Containers
32
Initial charge - reclaim
Automatic Commercial Ice Makers
33
Initial charge - reclaim
Modern Rail Transport
34
Initial charge - reclaim
Vintage Rail Transport
35
Initial charge - reclaim
Marine Transport
36
Initial charge - reclaim
Rack
182
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37
Initial charge - reclaim
Cold Storage
38
Initial charge - reclaim
IPR
Use of reclaimed HFCs for semiring and/or repair of existing equipment starting January 1,
2028
This proposed requirement was modeled as a series of abatement options that account for whether the
equipment types for which reclaimed refrigerant must be used are covered or not covered by the proposed
leak repair requirements. For those equipment types covered by the proposed leak repair requirements, the
abatement options further distinguish between: a) leak repair above the leak threshold; and b) additional
servicing and/or repair that would be conducted that is below the leak rate threshold.
• Leak repair above the leak threshold, using reclaimed refrigerant, for marine transport, modern
rail transport, vintage rail transport, rack, cold storage, and IPR.
o To avoid double counting, these options supplant replace their equivalent, non-reclaim
options listed above in Leak Repair and ALD (i.e., option numbers 6 - 22), starting in
2028. Costs and consumption benefits of leak repair using reclaimed refrigerant would
be calculated using the leak repair methods described in the RIA Addendum—but
substituting the price of reclaimed refrigerant and applying the "offset" percentage for
reclaim described above.
Table K-ll: Combined leak repair, ALD, and reclaim abatement options added toMACC model
for the subsection (h) Ride analysis
Option No.
Type
Equipment Type
Equipment Size
39
Leak repair - reclaim
Modern Rail Transport
Sub-small
40
Leak repair - reclaim
Vintage Rail Transport
Sub-small
41
Leak repair - reclaim
Marine Transport
Small
42
Leak repair - reclaim
Medium
43
Leak repair - reclaim
Large
44
Leak repair - reclaim
Rack
Medium
45
Leak repair - reclaim
Large
183
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46
Leak repair - reclaim
Cold Storage
Large
47
Leak repair - reclaim
IPR
Medium
48
Leak repair - reclaim
Large
49
ALD - reclaim
Marine Transport
Medium
50
ALD - reclaim
Large
51
ALD - reclaim
Rack
Medium
52
ALD - reclaim
Large
53
ALD - reclaim
Cold Storage
Large
54
ALD - reclaim
IPR
Large
• Servicing and/or repair below the leak threshold using reclaimed refrigerant, for marine
transport, modern rail transport, vintage rail transport, rack, cold storage, and IPR.
o For these abatement options, the amount of servicing was based on the difference
between the amount of refrigerant replaced in each year (2028-2050) in equipment
leaking above the leak threshold and the baseline amount of servicing demand modeled
for these equipment types in the Vintaging Model. As for other reclaim options, the
assumed costs reflect the price of reclaimed refrigerant and the benefits apply the offset
percentage to translate from emissions to consumption.
Table K-12: Servicing reclaim abatement options added to MACC model for the subsection (h)
Ride analysis
Option No.
Type
Equipment Type
Equipment Size
55
Servicing - reclaim
Modern Rail Transport
Sub-small
56
Servicing - reclaim
Vintage Rail Transport
Sub-small
57
Servicing - reclaim
Marine Transport
Small
58
Servicing - reclaim
Medium
59
Servicing - reclaim
Large
60
Servicing - reclaim
Rack
Medium
184
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61
Servicing - reclaim
Large
62
Servicing - reclaim
Cold Storage
Large
63
Servicing - reclaim
IPR
Medium
64
Servicing - reclaim
Large
• All servicing cmd/or repair for equipment types not covered by the proposed leak repair
requirement.
o For these abatement options, servicing demand was derived from EPA's Vintaging
Model. As with other reclaim options, the assumed costs reflect the price of reclaimed
refrigerant and the benefits apply the offset percentage to translate from emissions to
consumption.
Table K-13: Servicing reclaim abatement options added to MAC C model for the subsection (h)
Ride analysis, cont.
Option No.
Type
Equipment Type
65
Servicing other equipment types - reclaim
Residential Unitary AC
66
Servicing other equipment types - reclaim
Small Commercial Unitary AC
67
Servicing other equipment types - reclaim
Large Commercial Unitary AC
68
Servicing other equipment types - reclaim
Window Units
69
Servicing other equipment types - reclaim
Packaged Terminal AC/Heat Pumps
70
Servicing other equipment types - reclaim
Ground-Source Heat Pumps
71
Servicing other equipment types - reclaim
Stand-Alone Retail Food Refrigeration
72
Servicing other equipment types - reclaim
Road Transport
73
Servicing other equipment types - reclaim
Intennodal Containers
74
Servicing other equipment types - reclaim
Automatic Commercial Ice Makers
Fire suppression equipment
185
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An additional set of abatement options was run for rule provisions associated with restricting intentional
releases (e.g., during installation, servicing, repairing, or disposal) of fire suppression equipment.
Abatement options for total flooding fire suppression systems were calculated assuming a proportion of
the annual leakage amount (assumed to be 0.5 percent) for total flooding systems estimated in the
Vintaging Model is avoided through the venting restriction. Cost savings are assumed because losses
during testing of new or existing systems would have been replaced before the unit enters or reenters
service.62
Because the venting restriction and reclamation requirement for servicing/repair of fire suppression
equipment start in the same year (2025), the venting prohibition option assumes that intentional venting
during testing would have been replaced with reclaimed agent, and therefore, as for other reclaim options,
the assumed costs reflect the price of reclaimed refrigerant and the benefits apply the offset percentage to
translate from emissions to consumption.
In addition, options associated with the requirement to use reclaim in servicing (i.e., for normal operating
leaks and servicing) for total flooding systems and filling of new fire suppression systems for total
flooding and streaming were considered. Costs and benefits for these options were calculated using the
same approach as that used for refrigeration and AC equipment.
Table K-14: Fire suppression abatement options added toMACC model for the subsection (h)
Ride analysis
Option No.
Type
Equipment Type
75
Venting prohibition - reclaim
Fire Extinguishing: Flooding Agents
76
Servicing- reclaim
Fire Extinguishing: Flooding Agents
77
Initial charge - reclaim
Fire Extinguishing: Streaming Agents
78
Initial charge - reclaim
Fire Extinguishing: Flooding Agents
62 An abatement option for the venting prohibition requirement is only applied to total flooding systems because
streaming systems are not assumed to be serviced and therefore have no consumption benefits associated with
avoiding leaks (i.e., losses from intentional venting are not replaced over the lifetime of the equipment). The venting
prohibition would have potential emission benefits for streaming systems. Similarly, an abatement option for the
servicing reclaim requirement is only applied to total flooding systems because streaming systems are not assumed
to be serviced.
186
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Summary Table of Mitigation Options Modeled Specific to the Subsection (h)
Rule
Table K-15: Summary of Mitigation Options Modeled
Option No.
Type
Equipment Type
Equipment Size
Breakeven Cost
($/ton MT C02e)
1
Leak Repair
School & Tour Buses
Sub-
small
$3,050.69
2
Leak Repair
Transit Buses
Sub-
small
$1,800.98
3
Leak Repair
Trains
Sub-
small
$470.91
4
Leak Repair
Chillers
Medium
$38.83
5
Leak Repair
Chillers
Large
$10.37
6
Leak Repair
Modem Rail Transport
Sub-
small
$547.74
7
Leak Repair
Vintage Rail Transport
Sub-
small
$358.57
8
Leak Repair
Condensing Units
Sub-
small
$464.45
9
Leak Repair
Marine Transport
Small
$21.16
10
Leak Repair
Marine Transport
Medium
$21.01
11
Leak Repair
Marine Transport
Large
$10.19
12
Leak Repair
Rack
Medium
$33.20
13
Leak Repair
Rack
Large
$15.31
14
Leak Repair
Cold Storage
Large
0.61
15
Leak Repair
IPR
Medium
$36.56
16
Leak Repair
IPR
Large
$0.80
17
ALD
Marine Transport
Medium
$28.57
18
ALD
Marine Transport
Large
$19.44
19
ALD
Rack
Medium
$189.46
20
ALD
Rack
Large
$130.70
21
ALD
Cold Storage
Large
6.97
22
ALD
IPR
Large
$20.94
187
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No.
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
Type
Equipment Type
Equipment Size
Breakeven Cost
($/ton MT C02e)
Initial charge ¦
reclaim
Residential Unitary AC
Initial charge ¦
reclaim
Small Commercial
Unitary AC
Initial charge ¦
reclaim
Large Commercial
Unitary AC
Initial charge ¦
reclaim
Window Units
Initial charge ¦
reclaim
Packaged Terminal
AC/Heat Pumps
Initial charge ¦
reclaim
Ground-Source Heat
Pumps
Initial charge ¦
reclaim
Stand-Alone Retail
Food Refrigeration
Initial charge ¦
reclaim
Road Transport
Initial charge ¦
reclaim
Intermodal Containers
Initial charge ¦
reclaim
Automatic Commercial
Ice Makers
Initial charge ¦
reclaim
Modem Rail Transport
Initial charge ¦
reclaim
Vintage Rail Transport
Initial charge ¦
reclaim
Marine Transport
Initial charge ¦
reclaim
Rack
Initial charge ¦
reclaim
Cold Storage
Initial charge ¦
reclaim
IPR
Leak repair ¦
reclaim
Modem Rail Transport
Sub-
small
Leak repair ¦
reclaim
Vintage Rail Transport
Sub-
small
Leak repair ¦
reclaim
Marine Transport
Small
Leak repair ¦
reclaim
Marine Transport
Medium
Leak repair ¦
reclaim
Marine Transport
Large
Leak repair ¦
reclaim
Rack
Medium
188
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RrGakfi¥6ii Cost
Option No. Type Equipment Type Equipment Size $/ton MT C02ej
45
Leak repair -
reclaim
Rack
Large
$30.04
46
Leak repair -
reclaim
Cold Storage
Large
1.10
47
Leak repair -
reclaim
IPR
Medium
$72.14
48
Leak repair -
reclaim
IPR
Large
$1.02
49
ALD - reclaim
Marine Transport
Medium
$56.51
50
ALD - reclaim
Marine Transport
Large
$38.24
51
ALD - reclaim
Rack
Medium
$378.23
52
ALD - reclaim
Rack
Large
$260.72
53
ALD - reclaim
Cold Storage
Large
13.76
54
ALD - reclaim
IPR
Large
$41.25
55
Servicing - reclaim
Modem Rail Transport
Sub-
small
$0.66
56
Servicing - reclaim
Vintage Rail Transport
Sub-
small
$1.23
57
Servicing - reclaim
Marine Transport
Small
$0.48
58
Servicing - reclaim
Marine Transport
Medium
$0.49
59
Servicing - reclaim
Marine Transport
Large
$0.63
60
Servicing - reclaim
Rack
Medium
$0.68
61
Servicing - reclaim
Rack
Large
$0.68
62
Servicing - reclaim
Cold Storage
Large
$0.45
63
Servicing - reclaim
IPR
Medium
$-
64
Servicing - reclaim
IPR
Large
$0.68
65
Servicing other
equipment types -
reclaim
Residential Unitary AC
Sub-
small
$1.01
66
Servicing other
equipment types -
reclaim
Small Commercial
Unitary AC
Sub-
small
$0.90
67
Servicing other
equipment types -
reclaim
Large Commercial
Unitary AC
Sub-
small
$0.94
68
Servicing other
equipment types -
reclaim
Window Units
Sub-
small
$0.96
189
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Option No.
Type
Equipment Type
Equipment Size
Breakeven Cost
($/ton MT C02e)
69
Servicing other
equipment types -
reclaim
Packaged Terminal
AC/Heat Pumps
Sub-
small
$0.91
70
Servicing other
equipment types -
reclaim
Ground-Source Heat
Pumps
Sub-
small
$0.97
71
Servicing other
equipment types -
reclaim
Stand-Alone Retail
Food Refrigeration
Sub-
small
$1.26
72
Servicing other
equipment types -
reclaim
Road Transport
Sub-
small
$0.50
73
Servicing other
equipment types -
reclaim
Intermodal Containers
Sub-
small
$1.12
74
Servicing other
equipment types -
reclaim
Automatic Commercial
Ice Makers
Sub-
small
$0.53
75
Venting prohibition
- reclaim
Fire Extinguishing:
Flooding Agents (w/
Venting Prohibition)
$0.51
76
Servicing - reclaim
Fire Extinguishing:
Flooding Agents
$0.51
77
Initial charge -
reclaim
Fire Extinguishing:
Streaming Agents
$0.18
78
Initial charge -
reclaim
Fire Extinguishing:
Flooding Agents
$0.50
190
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Appendix L. Unfunded Mandates Reform Act Statement
Pursuant to the Title II of the Unfunded Mandates Reform Act (UMRA), 2 U.S.C. 1531-1538,
EPA has determined that the proposed rule, "Phasedown ofHydrofluorocarbons: Management of Certain
Hydrofluorocarbons and Substitutes under Subsection (h) of the American Innovation and Manufacturing
Act of2020; Proposed Rule," contains a federal mandate that may result in expenditures of $100 million
or more by the private sector in any one year, but is not expected to result in expenditures of this
magnitude by State, local, and Tribal governments in the aggregate. EPA has prepared this statement in
accordance with section 202(a) of UMRA.
(1) Authorizing Legislation. This rule is issued under the authority of subsection (h) of the
American Innovation and Manufacturing (AIM) Act, 42 U.S.C. § 7675(h).
(2) Benefit-Cost Analysis. EPA has prepared an economic analysis to evaluate, among other
things, the benefits and costs of this rule. See "Draft Regulatory Impact Analysis Addendum: Analysis of
the Economic Impact and Benefits of the Proposed Rule: American Innovation and Manufacturing (AIM)
Act Subsection H Management of Regulated Substances" This document is available in the public docket
for this rule.
In the Draft Regulatory Impact Analysis (RIA) Addendum, the total estimated compliance costs
for the period 2025-2050 period are estimated in terms of their present value (PV) as well as their
equivalent annualized value (EAV), which represents a flow of constant annual values that, had they
occurred in each year, would yield a sum equivalent to PV. These estimates are provided using both 3
percent and 7 percent discount rates. The EAV of total compliance costs associated with the proposed rule
is estimated to be approximately $213 million using a 3 percent discount rate and $217 million using a 7
percent discount rate.
When adjusted for inflation, the $100 million UMRA threshold established in 1995 is equivalent
to approximately $184 million in 2022 dollars, the year dollars for the cost estimates in this proposed rule.
Thus, the cost of the rule to the private sector exceeds the inflation-adjusted UMRA threshold in any one
year.
Most of the estimated compliance costs would be incurred by owners and operators of
refrigeration, air conditioning, and heat pumps (RACHP) equipment using HFC refrigerants. For
informational purposes, EPA has also estimated environmental benefits from the proposed rule in terms
of avoided climate damages. Using EPA's social cost of HFCs methodology described in the Draft RIA
Addendum, the total value of these monetized benefits significantly outweighs the above-mentioned
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compliance costs. When accounting for these benefits, the EAV of total net benefits (benefits minus
costs) stemming from the proposed ranges from approximately $353 million (when discounting
compliance costs at 3 percent) to $349 million (when discounting compliance costs at 7 percent).
Although EPA is using SC-HFCs for purposes of some of the analysis in the RIA addendum, this
proposed action does not rely on those estimates of these costs as a record basis for the Agency action,
and EPA would reach the proposed conclusions even in the absence of the social costs of HFCs.
(A) Federal Financial Assistance. EPA has not identified any sources of federal
financial assistance (e.g., grants or loans) that are available from either EPA or other federal
agencies to defray State, local, or Tribal expenditures under this rule.
(B) Federal Resources. EPA has not identified any federal resources available to carry
out the private sector mandate contained in this rule.
(3) Costs and Budgetary Impacts.
(A) Future Compliance Costs. Total estimated compliance costs of the proposed rule
are estimated to be approximately $213 to $217 million per year for the period 2025-2050.
(B) Disproportionate Budgetary Effects. EPA has no evidence to suggest that this rule
will have disproportionate budgetary impacts on any particular industry or region of the country.
(4) Effect on National Economy. Given the current gross domestic product (GDP) for the United
States, the cost of this proposed rule, as shown in the economic analysis, are around one thousandth of
one percent of U.S. GDP. Therefore, EPA has concluded that this rule is highly unlikely to have a
significant effect on the national economy.
(5) Prior consultation with affected State, local, and Tribal governments. This action contains
no unfunded federal mandate for State, local, and Tribal governments as described in UMRA, 2 U.S.C.
1531-1538. While this rule contains a federal mandate that may result in expenditures that exceed the
inflation-adjusted UMRA threshold of $100 million by the private sector in any one year, it is not
expected to result in expenditures of this magnitude by State, local, and Tribal governments in the
aggregate. Therefore, EPA did not consult with State, local, or Tribal governments, however State, local,
or Tribal governments have participated in EPA-hosted stakeholder meetings.
(6) Small Government Agency Plan. This rule does not contain a significant federal
intergovernmental mandate as described by § 203 of UMRA, because this action is not subject to the
requirements of section 203 of UMRA because it contains no regulatory requirements that might
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significantly or uniquely affect small governments. Therefore, EPA did not prepare a small government
agency plan.
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