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‘Big Deal’ Rule Slashing Climate Pollutants Finalized by EPA (1)

Sept. 23, 2021, 9:10 AMUpdated: Sept. 23, 2021, 4:22 PM

The Biden administration on Thursday finalized its first major move in climate regulation, aimed at curbing greenhouse gases by slashing climate superpollutants called hydrofluorocarbons.

The rule facilitates an 85% phasedown of the use of hydrofluorocarbons, or HFCs, over the next 15 years. That’s estimated to cut the equivalent of 4.5 billion metric tons of carbon dioxide by 2050, White House National Climate Adviser Gina McCarthy told reporters at a Wednesday night press briefing.

“It’s really frankly, folks, a very big deal,” she said.

The new standards get the U.S. on track to meet international HFC reduction goals ahead of the upcoming United Nations climate summit in Glasgow. President Joe Biden is eager to show U.S. leadership on climate change on multiple fronts.

Kigali Amendment

Congress handed authority to the Environmental Protection Agency for HFC phasedown rules through the American Innovation and Manufacturing Act included in this year’s stimulus and coronavirus relief package. It also pushes the U.S. closer to compliance with the Kigali Amendment, a pact in the Montreal Protocol to limit the compound globally.

McCarthy didn’t have specifics on when the White House would send the Kigali Amendment for ratification in the Senate, but said the final HFC rules make the “U.S. domestic approach entirely consistent with the key provisions” in the pact.

EPA’s “fast” move on the HFC phasedown rule meets key requirements under AIM and has a broad swath of support from green groups, states and industry, David Doniger, senior strategic director of the Natural Resources Defense Council’s climate and clean energy program, said in a statement to Bloomberg Law.

“Moving from HFCs to climate-friendlier alternatives is an important part of President Biden’s plan to meet the climate crisis by cutting America’s heat-trapping emissions at least in half by 2030—with big benefits for jobs, our health and a safer future,” he said in an email.

Sen. Tom Carper (D-Del.) and Rep. Paul Tonko (D.-N.Y.) co-hosted the rule’s signing ceremony with Regan on Thursday morning, and are among the lawmakers who have expressed bipartisan support for the action.

Sen. Edward J. Markey (D-Mass.) said momentum from the administration’s action should fuel progress on the separate budget bill containing numerous climate-related provisions that has become bogged down amid disputes between moderate and progressive Democrats.

“We must use this action as a springboard and continue to push for the ambitious solutions we need to combat the climate crisis by passing the budget reconciliation bill,” Sen. Edward J. Markey (D-Mass.) said in an email statement.

A Climate ‘Win’

Both industry and environmental groups hailed the rule’s proposal in May, lauding the organized phaseout of the administration’s first major climate move.

The final rule is a “win” for the climate and economy, Air-Conditioning, Heating, and Refrigeration Institute President & CEO Stephen Yurek told Bloomberg Law in an email.

“Predictability is a very important aspect of the manufacturing process, and this timely rule ensures that our member companies are aware of this regulatory terrain for the coming years,” he said.

The rules set up an allowance system to curb HFCs gradually through a cap-and-trade program, establishing a starting point for reductions, a phasedown schedule, and a formula that determines allocations for companies.

Allowances will be set for 2022 and 2023 under the new rule, with subsequent yearly caps to come in rulemakings down the line.

Major Reductions

Human-caused HFCs are potent contributors to global warming that are released through production and use within things such as aerosols, industrial refrigeration, and air conditioners.

They don’t contribute to a high percentage of overall domestic greenhouse gas emissions, but can be thousands of times more powerful than carbon dioxide, according to the EPA.

Global HFC reductions could avoid an estimated 2.5 degrees Celsius (4.5 degrees Fahrenheit) of global warming by the year 2100, EPA Administrator Michael Regan told reporters when unveiling the final rule. He called the “landmark” program a boon for the climate as well as the U.S. economy.

“Transitioning to safer alternatives, and more energy efficient cooling technologies, is expected to generate more than $270 billion in cost savings, and public health benefits by the year 2050,” he said.

Interagency Goals

Along with the phasedown plan, the White House announced new efforts to cut HFCs that will extend across six agencies.

The actions cover four main areas, including bolstering HFC alternatives, managing HFC supply, and advancing research, according to a White House fact sheet.

This also includes the creation of an interagency task force to address the illegal HFC trade, led by the Department of Homeland Security, and EPA’s air and enforcement offices.

“Today brings another example of how the Biden-Harris administration is using their all of government approach to tackle climate change by slashing emissions of super-pollutant HFCs and driving innovation and clean tech jobs here in the U.S,” Matthew Davis, the League of Conservation Voters’ government affairs senior director, said in a statement.

(Updated with additional reporting throughout.)

To contact the reporter on this story: Jennifer Hijazi in Washington at jhijazi@bloombergindustry.com

To contact the editors responsible for this story: Rebecca Baker at rbaker@bloombergindustry.com; Chuck McCutcheon at cmccutcheon@bloombergindustry.com

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