[Federal Register Volume 87, Number 195 (Tuesday, October 11, 2022)]
[Notices]
[Pages 61314-61318]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-22059]
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ENVIRONMENTAL PROTECTION AGENCY
[EPA-HQ-OAR-2021-0669; FRL-9116-03-OAR]
Phasedown of Hydrofluorocarbons: Notice of 2023 Allowance
Allocations for Production and Consumption of Regulated Substances
Under the American Innovation and Manufacturing Act of 2020
AGENCY: Environmental Protection Agency (EPA).
ACTION: Notice.
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SUMMARY: The Environmental Protection Agency (EPA) has issued calendar
year 2023 allowances for the production and consumption of
hydrofluorocarbons in accordance with the Agency's regulations as
established in the 2021 final rule titled Phasedown of
Hydrofluorocarbons: Establishing the Allowance Allocation and Trading
Program under the American Innovation and Manufacturing Act. The
American Innovation and Manufacturing Act directs the Environmental
Protection Agency by October 1 of each calendar year to determine the
quantity of production and consumption allowances for the following
calendar year. The Agency also provided notice to certain companies on
September 30, 2022, that the Agency intends to retire an identified set
of those companies' allowances in accordance with the administrative
consequences provisions established in the final rule.
FOR FURTHER INFORMATION CONTACT: Andy Chang, U.S. Environmental
Protection Agency, Stratospheric Protection Division, telephone number:
202-564-6658; email address: [email protected]. You may also visit
EPA's website at https://www.epa.gov/climate-hfcs-reduction for further
information.
SUPPLEMENTARY INFORMATION: Subsection (e)(2)(D)(i) of the American
Innovation and Manufacturing Act of 2020 (AIM Act) directs the
Environmental Protection Agency (EPA) to determine, by October 1 of
each calendar year, the quantity of allowances for the production and
consumption of regulated substances that may be used for the following
calendar year. EPA has codified the production and consumption
baselines and phasedown schedules for regulated substances in 40 CFR
84.7. Under the phasedown schedule, for 2023, total production
allowances may not exceed 344,299,157 metric tons of exchange value
equivalent (MTEVe) and total consumption allowances may not exceed
273,498,315 MTEVe.
EPA regulations at 40 CFR part 84, subpart A, outline the process
by which the Agency determines the number of allowances each entity is
allocated. EPA allocated allowances consistent with this process for
calendar year 2023, and has posted entity-specific allowance
allocations on its website at https://www.epa.gov/climate-hfcs-reduction. An allowance allocated under the AIM Act does not constitute
a property right and is a limited authorization for the production or
consumption of a regulated substance.
EPA has codified the procedure for calculating application-specific
allowance allocations in 40 CFR 84.13. These allowances are drawn from
both the production and consumption allowance pools. EPA is issuing
``application-specific allowances'' to end users in five applications
established by the AIM Act: propellants in metered dose inhalers,
defense sprays, structural composite preformed polyurethane foam for
marine use and trailer use, etching of semiconductor material or wafers
and the cleaning of chemical vapor deposition chambers within the
semiconductor manufacturing sector, and onboard aerospace fire
suppression. Additionally, EPA is issuing ``application-specific
allowances'' to the U.S. Department of Defense for mission-critical
military end uses.
EPA has denied requests for application-specific allowances from
Applied Materials, Inc; Benuvia Manufacturing; General Electric Global
Research Center; Gilero LLC; Guardian Protective Devices, Inc.;
nHalience LLC; and Shamrock Filling LLC because they are ineligible
under 40 CFR 84.13. The requests were ineligible for at least one of
the following reasons:
(1) Did not meet the criteria for HFC use in a covered application;
(2) Did not submit by the deadline;
(3) Did not provide proper supporting documentation or
justification for their requests; or
(4) Did not report purchases of regulated substances in the past
three years.
EPA has allocated 2023 application-specific allowances as shown in
Table 1.
[[Page 61315]]
Table 1--Application-Specific Allowances for Calendar Year 2023
------------------------------------------------------------------------
Number of
application-
Entity Application specific
allowances issued
(MTEVe) \1\
------------------------------------------------------------------------
Analog Devices.................. Semiconductors..... 28,852.2
Apple........................... Semiconductors..... 1,033.8
Armstrong Pharmaceuticals....... Metered Dose 157,231.4
Inhalers.
ASML US......................... Semiconductors..... 1,237.2
AstraZeneca Pharmaceuticals..... Metered Dose 4,652.7
Inhalers.
Aurobindo Pharma USA............ Metered Dose 65,427.9
Inhalers.
Broadcom........................ Semiconductors..... 834.7
Compsys......................... Structural 14,152.8
Composite Foam.
Defense Technology.............. Defense Sprays..... 9,366.7
Diodes Incorporated............. Semiconductors..... 3,667.1
GlobalFoundries................. Semiconductors..... 177,721.8
Hitachi High-Tech America....... Semiconductors..... 1,064.4
IBM Corporation................. Semiconductors..... 533.5
Intel Corporation............... Semiconductors..... 746,212.5
InvaGen Pharmaceuticals......... Metered Dose 74,380.1
Inhalers.
Jireh Semiconductor............. Semiconductors..... 5,787.8
Keysight Technologies........... Semiconductors..... 538.8
Kindeva Drug Delivery........... Metered Dose 408,952.0
Inhalers.
Lupin........................... Metered Dose 24,098.0
Inhalers.
Medtronic....................... Semiconductors..... 637.6
Microchip Technology............ Semiconductors..... 31,266.7
Micron Technology............... Semiconductors..... 42,600.7
Newport Fab DBA TowerJazz....... Semiconductors..... 8,042.3
NXP Semiconductors.............. Semiconductors..... 86,878.8
Odin Pharmaceuticals............ Metered Dose 1,708.5
Inhalers.
Polar Semiconductor............. Semiconductors..... 13,446.4
Proteng Distribution............ Onboard Aerospace 4,060.4
Fire Suppression.
Qorvo Texas..................... Semiconductors..... 1,237.2
Raytheon Technologies........... Onboard Aerospace 952.6
Fire Suppression.
Renesas Electronics America..... Semiconductors..... 4,445.5
Samsung Austin Semiconductor.... Semiconductors..... 384,969.7
Security Equipment Corporation.. Defense Sprays..... 63,889.9
Semiconductor Components Semiconductors..... 38,821.5
Industries DBA ON Semiconductor.
SkyWater Technology............. Semiconductors..... 17,549.8
Skyworks Solutions.............. Semiconductors..... 4,652.3
Texas Instruments............... Semiconductors..... 194,744.9
The Research Foundation for The Semiconductors..... 159.9
State University of New York.
Tokyo Electron America.......... Semiconductors..... 558.8
Tower Semiconductor San Antonio. Semiconductors..... 4,948.7
TSMC Arizona Corporation........ Semiconductors..... 32,632.0
UDAP Industries................. Defense Sprays..... 110,727.8
Wabash National Corporation..... Structural 73,543.0
Composite Foam.
WaferTech....................... Semiconductors..... 22,355.4
Wolfspeed....................... Semiconductors..... 36,114.7
X-FAB Texas..................... Semiconductors..... 5,076.0
Zarc International.............. Defense Sprays..... 1,384.1
Department of Defense........... Mission-critical 2,513,169.3
Military End Uses.
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Total....................... All................ 5,426,319.9
------------------------------------------------------------------------
\1\ Numbers may not sum due to rounding.
EPA has codified the procedure for calculating the production
allowance allocation in 40 CFR 84.9. EPA has allocated calendar year
2023 production allowances as shown in Table 2.
[[Page 61316]]
Table 2--Production Allowances for Calendar Year 2023
------------------------------------------------------------------------
Number of
production
Entity allowances
issued (MTEVe)
\1\
------------------------------------------------------------------------
Application-specific allowances \2\..................... 5,426,319.9
Arkema.................................................. 40,873,469.3
Chemour................................................. 75,703,417.3
Honeywell International................................. 171,747,616.1
Iofina Chemical......................................... 1,758.6
Mexichem Fluor DBA Koura................................ 50,546,575.8
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Total............................................... 344,299,157.0
------------------------------------------------------------------------
\1\ Numbers may not sum due to rounding.
\2\ See Table 1.
EPA has codified the procedure for calculating the consumption
allowance allocation in 40 CFR 84.11. Calendar year 2023 consumption
allowances have also been allocated to new market entrants consistent
with 40 CFR 84.15.\1\ EPA has allocated calendar year 2023 consumption
allowances as shown in Table 3.
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\1\ A comprehensive overview and discussion of allocation
decisions to new market entrants can be found in the Agency's April
5, 2022, notice Phasedown of Hydrofluorocarbons: Notice of 2022 Set-
Aside Pool Allowance Allocations for Production and Consumption of
Regulated Substances Under the American Innovation and Manufacturing
Act of 2020 [87 FR 19683].
Table 3--Consumption Allowances for Calendar Year 2023
------------------------------------------------------------------------
Number of
consumption
Entity allowances issued
(MTEVe) \1\
------------------------------------------------------------------------
Application-specific allowances \2\.................. 5,426,319.9
A.C.S. Reclamation & Recovery (Absolute Chiller 200,000.0
Services) *.........................................
Ability Refrigerants *............................... 200,000.0
ACT Commodities *.................................... 77.8
Advance Auto Parts *................................. 190,699.1
Advanced Specialty Gases............................. 285,314.5
AFK & Co. *.......................................... 193,335.9
AFS Cooling *........................................ 200,000.0
A-Gas................................................ 3,209,232.5
Air Liquide USA...................................... 498,530.3
AllCool Refrigerant Reclaim *........................ 200,000.0
Altair Partners...................................... 2,918,730.4
American Air Components *............................ 200,000.0
Arkema............................................... 31,075,488.7
Artsen............................................... 1,027,571.2
Automart Distributors DBA Refrigerant Plus *......... 200,000.0
AutoZone Parts....................................... 2,486,664.3
AW Product Sales & Marketing......................... 194,505.7
Bluon................................................ 33,459.8
CC Packaging *....................................... 194,000.0
Certified Refrigerant Services *..................... 200,000.0
Chemours............................................. 33,382,686.1
Chemp Technology *................................... 200,000.0
Combs Gas............................................ 1,287,918.3
ComStar International................................ 374,063.9
Creative Solution *.................................. 200,000.0
Cross World Group *.................................. 200,000.0
Daikin America....................................... 3,120,932.2
EDX Industry *....................................... 200,000.0
Electronic Fluorocarbons............................. 104,289.0
Fireside Holdings DBA American Refrigerants *........ 199,978.5
First Continental International...................... 769,838.0
FluoroFusion Specialty Chemicals..................... 2,552,532.6
Freskoa USA *........................................ 200,000.0
GlaxoSmithKline...................................... 536,367.9
Golden Refrigerant *................................. 200,000.0
Harp USA............................................. 765,574.0
Honeywell International.............................. 82,497,424.7
Hudson Technologies.................................. 2,988,057.5
Hungry Bear *........................................ 200,000.0
ICool USA............................................ 3,406,995.9
IGas Holdings........................................ 25,944,614.3
Iofina Chemical...................................... 1,264.9
Kidde-Fenwal *....................................... 200,000.0
Lenz Sales & Distribution............................ 1,110,319.3
Lina Trade *......................................... 200,000.0
Linde................................................ 532,503.3
Meraki Group *....................................... 200,000.0
Metalcraft *......................................... 161,000.0
Mexichem Fluor DBA Koura............................. 25,479,884.3
[[Page 61317]]
Mondy Global......................................... 318,706.9
National Refrigerants................................ 19,806,810.9
Nature Gas Import and Export......................... 819,624.4
North American Refrigerants *........................ 200,000.0
O23 Energy Plus *.................................... 200,000.0
Perfect Score Too DBA Perfect Cycle*................. 37,876.0
Reclamation Technologies *........................... 200,000.0
Refrigerants, Inc.................................... 26,550.9
RMS of Georgia....................................... 1,621,276.8
RTR Suppliers *...................................... 198,000.0
Saalok *............................................. 200,000.0
Sciarra Laboratories *............................... 8,700.0
SDS Refrigerant Services *........................... 200,000.0
Showa Chemicals of America........................... 73,466.6
Solvay Fluorides..................................... 1,102,459.2
Summit Refrigerants *................................ 200,000.0
SynAgile Corporation *............................... 1,125.1
Technical Chemical................................... 974,140.0
TradeQuim *.......................................... 200,000.0
Transocean Offshore Deepwater Drilling............... 16.8
Tulstar Products..................................... 734,110.9
Tyco Fire Products *................................. 200,000.0
USA United Suppliers of America DBA USA Refrigerants 200,000.0
*...................................................
USSC Acquisition Corp *.............................. 131,451.0
Walmart.............................................. 2,280,583.0
Waysmos USA.......................................... 634,504.6
Weitron.............................................. 6,338,344.6
Wesco HMB *.......................................... 200,000.0
Wilhelmsen Ships Service............................. 40,392.5
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Total............................................ 273,498,315.0
------------------------------------------------------------------------
\1\ Numbers may not sum due to rounding.
\2\ See Table 1.
* These entities were issued consumption allowances consistent with the
provisions in 40 CFR 84.15(e)(3). Consistent with 40 CFR 84.15(e)(3)
and as clarified in the Agency's 2021 final rule, these entities were
issued the same number of allowances for 2023 as they were in 2022. In
accordance with 40 CFR 84.15(f)(1), allowances allocated to these
entities may not be transferred.
On September 30, 2022, EPA also provided notice to four entities of
the Agency's intent to take administrative consequences in accordance
with 40 CFR 84.35. Using this authority, EPA can retire, revoke, or
withhold the allocation of allowances, or ban a company from receiving,
transferring, or conferring allowances.\2\ EPA provided notice of its
intent to retire an identified set of each of the four companies'
allowances, affecting both calendar year 2022 and calendar year 2023
allowances.
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\2\ Administrative consequences that the Agency has finalized
can be found here: https://www.epa.gov/climate-hfcs-reduction/administrative-consequences-under-hfc-allocation-rule.
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Judicial Review
The AIM Act provides that certain sections of the Clean Air Act
(CAA) ``shall apply to'' the AIM Act and actions ``promulgated by the
Administrator of [EPA] pursuant to [the AIM Act] as though [the AIM
Act] were expressly included in title VI of [the CAA].'' 42 U.S.C.
7675(k)(1)(C). Among the applicable sections of the CAA is section 307,
which includes provisions on judicial review. Section 307(b)(1)
provides, in part, that petitions for review must only be filed in the
United States Court of Appeals for the District of Columbia Circuit:
(i) when the agency action consists of ``nationally applicable
regulations promulgated, or final actions taken, by the
Administrator,'' or (ii) when such action is locally or regionally
applicable, but ``such action is based on a determination of nationwide
scope or effect and if in taking such action the Administrator finds
and publishes that such action is based on such a determination.'' For
locally or regionally applicable final actions, the CAA reserves to the
EPA complete discretion whether to invoke the exception in (ii).
The final action herein noticed is ``nationally applicable'' within
the meaning of CAA section 307(b)(1). The AIM Act imposes a national
cap on the total number of allowances available for each year for all
entities nationwide. 42 U.S.C. 7675(e)(2)(B)-(D). For 2023, there was a
national pool of 344,299,157 production allowances and 273,498,315
consumption allowances available to distribute. The action noticed
herein distributed that finite set of allowances consistent with the
methodology EPA established in the nationally applicable framework
rule. As such, the allowance allocation is the division and assignment
of a single, nationwide pool of HFC allowances to entities across the
country according to the uniform, national methodology established in
EPA's regulations. Each entity's allowance allocation is a relative
share of that pool; thus, any additional allowances awarded to one
entity directly affects the allocations to others.
In the alternative, to the extent a court finds the final action to
be locally or regionally applicable, the Administrator is exercising
the complete discretion afforded to him under the CAA to make and
publish a finding that the action is based on a determination of
[[Page 61318]]
``nationwide scope or effect'' within the meaning of CAA section
307(b)(1).\3\ In deciding to invoke this exception, the Administrator
has taken into account a number of policy considerations, including his
judgment regarding the benefit of obtaining the D.C. Circuit's
authoritative centralized review, rather than allowing development of
the issue in other contexts, in order to ensure consistency in the
Agency's approach to allocation of allowances in accordance with EPA's
national regulations in 40 CFR part 84. The final action treats all
affected entities consistently in how the Part 84 regulations are
applied. The allowance allocation is the division and assignment of a
single, nationwide pool of HFC allowances to entities across the
country according to the uniform, national methodology established in
EPA's regulations, and each entity's allowance allocation is a relative
share of that pool; thus, any additional allowances awarded to one
entity directly affect the allocations to others. The Administrator
finds that this is a matter on which national uniformity is desirable
to take advantage of the D.C. Circuit's administrative law expertise
and facilitate the orderly development of the basic law under the AIM
Act and EPA's implementing regulations. The Administrator also finds
that consolidated review of the action in the D.C. Circuit will avoid
piecemeal litigation in the regional circuits, further judicial
economy, and eliminate the risk of inconsistent results for different
regulated entities. The Administrator also finds that a nationally
consistent approach to the allocation of allowances constitutes the
best use of agency resources. The Administrator is publishing his
finding that the action is based on a determination of nationwide scope
or effect in the Federal Register as part of this notice in addition to
inclusion on the website announcing allocations.
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\3\ In the report on the 1977 Amendments that revised section
307(b)(1) of the CAA, Congress noted that the Administrator's
determination that the ``nationwide scope or effect'' exception
applies would be appropriate for any action that has a scope or
effect beyond a single judicial circuit. See H.R. Rep. No. 95-294 at
323, 324, reprinted in 1977 U.S.C.C.A.N. 1402-03.
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For these reasons, the final action of the Agency allocating
hydrofluorocarbon allowances to entities located throughout the country
is nationally applicable or, alternatively, the Administrator is
exercising the complete discretion afforded to him by the CAA and finds
that the final action is based on a determination of nationwide scope
or effect for purposes of CAA section 307(b)(1) and is hereby
publishing that finding in the Federal Register.
Under section 307(b)(1) of the CAA, petitions for judicial review
of this action must be filed in the United States Court of Appeals for
the District of Columbia Circuit by December 12, 2022.
Hans Christopher Grundler,
Director, Office of Atmospheric Programs.
[FR Doc. 2022-22059 Filed 10-7-22; 8:45 am]
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