Honeywell & Chemours File Appeal On HFC Refrigerant Ruling

Well ladies and gentlemen I have to say that I saw this coming. The deadline to file an appeal on the Federal Court’s ruling against the EPA’s phaseout of HFC refrigerants was September 22nd, 2017. Lo and behold, at the last minute on the last day an appeal was filed by Honeywell and Chemours. This appeal brings up a whole other wave of uncertainty. How will the courts rule? What will happen if the ruling stands and the EPA cannot phase out HFC refrigerants without going through the Congress? If that happens the industry could be turned on it’s head. We all know that today’s Congress would never vote for such a thing. It seems like that people who want HFC’s phased out have this one last appeal card in their deck. If this fails who knows what they will try next.

For those of you not in the know, the EPA announced back in 2015 that they would be phasing out HFC refrigerants such as R-134a, R-404A, and R-410A through their SNAP, or Significant New Alternatives Policy. This new rule was called SNAP Rule 20. The country just accepted this mandate from the EPA and the industry moved on. Many companies began switching over to Hydrocarbons and others over to the new HFO refrigerant lines from Honeywell and Chemours.

In August of 2017 a Federal Court unexpectedly ruled against the EPA’s phase out of HFC refrigerants. This ruling threw everything into a tailspin and no one knew exactly what would happen next. For more information on this I wrote an article around the time it happened which can be found by clicking here.

Basically, the EPA tried to use section 612 of the Clean Air Act for their phase out. The problem here is though that this section of the Clean Air Act was designed specifically for CFC and HCFC refrigerants. It has nothing to do with HFC refrigerants. It’s design was to stop the damage to the Ozone layer by offering alternative refrigerants. Since HFC’s do not contain Chlorine and do not damage the Ozone they should not fall in the same category. This is how the court ruled. It seems like a very logical ruling, doesn’t?

Their Argument

The two companies who filed the appeal brought forth two arguments against the court’s ruling.

  1. First, they argue that the SNAP Rule 20 was well-founded and that the federal court’s ruling exceeded it’s jurisdiction as well as ignoring the original intent of the SNAP Program. (To replace Ozone depleting refrigerants with the safest alternatives.) This argument drives me crazy folks. They know they didn’t go through Congress and they know that they didn’t do it the right way. But none of that matters. No. Their intent was good. I guess as long as my intent is good I can do anything I want.
  2. The second argument and just as ludicrous in my book is that these two companies invested two much money to have this ruling being turned on it’s head. Chemours noted that they had invested more then one billion dollars to research, develop, and commercialize their new HFO refrigerants. All of this development was done under the guise of HFC refrigerants being phased out. What they don’t tell you here is that Chemours and Honeywell, have been investing money into HFOs long before the EPA made it’s decision to phase out HFC refrigerants in 2015. This argument seems like a moot point. In business their a thing called risk as all of you know.

Conclusion

It’s a toss up of what will happen here folks. In the original August ruling the Federal Court ruled two to one for overturning the EPA’s regulation. That is a narrow margin. Nobody had even seen this coming but now that there is a global spotlight on this ruling I can only guess that this appeal will be pushed through quickly.

What concerns me is the money behind this appeal. My fear is that with all of this money behind this that the appeal may not get a fair ruling and we may be back at where we started. I’ve said it before and I will say it again. I am not comfortable with two giant conglomerates like Honeywell and Chemours having all of the HFO manufacturing and production in their hands. Yes, other companies are free to develop their own alternatives but let’s be truthful here. These two companies have the power and they have the sway to convince other companies to make the switch to HFOs. It’s already happened in the automotive sector. Chances are if you look at a newer model vehicle it is taking HFO-1234YF. It’s only a matter of time before we see it start to take hold on Chillers and eventually commercial and residential air conditioning.

Thanks for reading,

Alec Johnson

RefrigerantHQ

Sources

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