The Biden administration has announced stringent new rules to reduce the use of coolants used in most air conditioning units and other appliances in the name of fighting climate change, with experts warning it will likely mean Americans will have to pay more to stay cool.

The Environmental Protection Agency (EPA) this week issued a final rule to slash the use of hydrofluorocarbons (HFCs) by 40 percent by 2028 while decrying the chemical a “climate super-pollutant.”

The rule dovetails with earlier efforts under the 2020 American Innovation and Manufacturing (AIM) Act to reduce the production and consumption of these chemicals by 85 percent by 2036.

HFCs are a type of synthetic refrigerant that is widely used as a replacement for chlorofluorocarbons (CFCs) and hydrochlorofluorocarbons (HCFCs), which are known for having properties that deplete the ozone layer.

However, while HFCs do not damage the ozone layer, they are potent greenhouse gases that EPA says contribute to climate change.

HFCs are used as refrigerants in most cooling systems, including refrigerators, heat pumps, and air conditioners.

Since the HFC phasedown first began on Jan. 1, 2022, the import and production of HFCs have required special allowances, with EPA saying in its Tuesday announcement that the number of these allowances will experience “a significant decrease.”

While there are HFC alternatives and more are being developed, it’s unclear how quickly the market could adapt and what kind of an impact the phaseout will have on the prices of air conditioning.

Ben Lieberman, a Senior Fellow at the Competitive Enterprise Institute (CEI) who specializes in environmental policy, wrote in an analysis in 2022 that wholesale prices for commonly used refrigerants had already increased 400 percent since EPA first embarked on the HFC phaseout a year prior.

“Service technicians say that replacing refrigerant lost from a leak now costs upwards of $800, about double what it did a year ago,” Mr. Lieberman wrote. “Moreover, EPA’s HFC quotas tighten in the years ahead, so the ratchet will keep turning, surely causing homeowners’ bills to increase further still.”

And while the environmental benefits of phasing out HFCs have become conventional wisdom, these, too, have been challenged.

Some research has estimated that an HFC phasedown could avoid up to half a degree Celsius of warming by 2100, a goal that EPA cited in its announcement.

“The U.S. HFC phasedown program, bolstered by domestic innovation to develop alternative chemicals and equipment, is paving the way for the United States to tackle climate change and strengthen global competitiveness,” Joe Goffman, principal deputy assistant administrator of EPA’s Office of Air and Radiation, in a statement.

However, the claim that phasing out HFCs by 85 percent by 2100 would prevent a half a degree Celsius of warming has been challenged, with critics arguing that this conventional wisdom is based on questionable assumptions and dubious foundations.

‘Beltway Rent-Seeking’?

Patrick Michaels, a senior fellow at the Competitive Enterprise Institute, and Benjamin Zycher, a resident scholar at the American Enterprise Institute, penned a critical op-ed in the Washington Examiner when EPA first unveiled a proposal (pdf) to begin curbing HFCs back in 2021.

“The HFC phaseout makes no sense as part of a larger international effort to reduce greenhouse gas emissions,” the pair wrote. They performed a calculation based on the EPA’s estimate that slashing HFCs in the United States would eliminate the equivalent of 4.7 billion metric tons of carbon dioxide.

“The 4.7-million-ton equivalent reduction would be 17 one-thousandths of 1 percent, the temperature effect of which would be undetectable,” they argued.

“This phaseout has nothing to do with environmental protection and everything to do with classic Beltway rent-seeking by a special interest group. It should be rejected,” they wrote.

Still, moves to curb the use of HFCs have seen rare bipartisan support in Washington and among industry.

The Air Conditioning, Heating, and Refrigeration Institute (AHRI), which represents air conditioning, heating, and commercial refrigeration manufacturers, called the rule a key step on the road to implementing the AIM Act.

“This latest allocation rule is a critical step in the implementation of the AIM Act schedule for phasing down hydrofluorocarbon refrigerants,” AHRI President and CEO Stephen Yurek said in a statement.

“Our industry appreciates the work of the EPA and the timely issuance of this rule, as we prepare for the next HFC reduction step-down next January,” he added.

The American Chemistry Council, which represents chemical manufacturers and users, also welcomed the EPA rule.

“ACC has long supported the HFCs phasedown, which can reduce a sizable source of greenhouse gas emissions while creating manufacturing jobs and growing our nation’s share of the global market for air-conditioning and refrigeration products,” the group said in a statement.

U.S. companies have developed effective alternatives to HFCs, the group added.

Kigali Amendment

Efforts to phase out the use of HFCs and transition to alternative refrigerants with a lower environmental impact got a boost in September 2022 when the U.S. Senate voted to ratify the Kigali Amendment to the Montreal Protocol, which regulates the production and consumption of ozone-depleting substances.

Twenty-one Republicans, including then-Senate Minority Leader Mitch McConnell (R-Ky.), voted to ratify in a 69-27 vote.

President Joe Biden later signed the ratification of the agreement, calling it a “historic, bipartisan win for American manufacturing and global climate action.”

White House climate adviser Ali Zaidi said in a statement on July 11 that the HFC phasedown, “bolstered by domestic innovation to develop alternative chemicals and equipment, is paving the way for the United States to tackle climate change and strengthen global competitiveness.”

Mr. Zaidi added that the new rule will incentivize U.S. industry to develop next-generation technologies for refrigeration.

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