AHRI Reaches Settlement on Walk-in Coolers and Freezers Energy Efficiency Rule
The HVACR and water heating industry has been affected in recent years by a dramatic increase in regulations affecting its products. The Air-Conditioning, Heating, and Refrigeration Institute (AHRI) regularly communicates with the Department of Energy (DOE) and the Environmental Protection Agency on proposed rulemakings to be sure the industry is well represented. AHRI evaluates proposed rules and, in collaboration with its manufacturer member company representatives, offers comments and proposes changes to rules.
Last year, AHRI filed suit against DOE’s June 2014 final rule setting energy efficiency standards for commercial walk-in coolers and freezers (WICF). Due to deadline constraints, AHRI also filed a petition to review the rule, in the hope that DOE would retract it and consider AHRI’s concerns. Unfortunately, DOE denied this request, referencing its interpretation of what is known as the “anti-rollback provision” of the Energy Policy and Conservation Act, which holds that a rule cannot be changed after it is issued if the effect would be to lower efficiency.
AHRI filed the lawsuit in August 2014, with Lennox and other intervenors named in the suit. The first briefs in the case were filed in May of this year, and AHRI argued that DOE had erred in numerous ways, including by setting internally inconsistent standards that were unachievable using economically feasible technologies, by performing flawed cost-benefit work, and by failing to properly analyze small-business impacts. AHRI and DOE reached a settlement agreement in 2015. Six of the standards for commercial refrigeration products included in the original rule were remanded in the settlement.
As part of the settlement, DOE agreed to a negotiated rulemaking for the remanded standards, which will completed by January 2016 and will result in recommendations to DOE for a new rulemaking.
The settlement includes the following provisions:
- Refrigeration standards for multiplex condensing systems at medium and low temperatures, and for dedicated condensing systems at low temperatures, will be vacated. DOE will support the use of a negotiated rulemaking process concerning the vacated standards, with a targeted completion date of January 2016 for this negotiated rulemaking process.
- DOE will align WICF refrigeration enforcement dates by issuing an executive branch policy making clear that it will not enforce the remaining WICF refrigeration standards until January 1, 2020, provided that the anticipated negotiated rulemaking process delivers proposed standards to DOE by January 22, 2016. The WICF standards for doors and panels are not affected by the settlement.
- DOE will consider and substantively address as part of the negotiated rulemaking process any potential impacts of the standards on installers and smaller manufacturers.
- Within six months, DOE will initiate a public process to determine how it will address error corrections in future rulemakings. DOE has also committed to employ best efforts to finalize that process within one year of the settlement.
As part of AHRI’s effort to explain problems that arise in a flawed rulemaking process, an AHRI member company representative testified in March before the House Small Business Committee. Viktor Anderson, chief engineer for Muskegon, Michigan-based Structural Concepts, a commercial refrigeration manufacturer, said that, left unchecked, the inability or unwillingness of DOE and EPA to coordinate rulemakings and coalesce around energy efficiency and environmental goals will “devastate” his industry.
Anderson noted that with DOE rulemakings setting new energy efficiency levels for commercial refrigeration equipment, and EPA rulemakings on allowable refrigerants being issued irrespective of one another, small businesses such as his have to spend inordinate amounts of money and time to comply with a seemingly endless series of rulemakings—to the point where “we could potentially be redesigning our products every two to three years for more than 12 years in a row.”
These concerns, and many others, led AHRI to file suit, as its efforts to communicate with DOE in advance of the rule were unsuccessful. AHRI is pleased with the settlement, as it is an opportunity to return to the drawing board and cooperatively develop lawful and rational standards for this equipment, as well as provide a new means for addressing the error-correction issue in future rulemakings. AHRI’s goal, as always, is to achieve transparency and accountability to the energy-efficiency rulemaking process, and reduce the need for future litigation.