The U.S. Environmental Protection Agency (EPA), filed a complaint against USA Wholesale, Inc. (“USA Wholesale”), a San Jose corporation which sells engine lubricants, for unlawfully importing hydrofluorocarbons (HFCs) through the port of Santa Theresa, NM in 2022. This is the first time EPA has used its authority under the American Innovation and Manufacturing Act of 2020 (“AIM Act”), to file an administrative complaint for illegally importing HFCs. The AIM Act, which implements the Kigali Amendment to the Montreal Protocol, by 2036 requires the United States to phase down HFC production and consumption by 85%.
EPA designated climate change mitigation as a National Enforcement and Compliance Initiative (pdf), which includes addressing the illegal import of HFCs under the current phasedown. Over the last several months, the agency has taken several enforcement actions against companies for their illegal import of HFCs.
“EPA is using every enforcement tool available to hold companies accountable for the illegal importation of refrigerants that damage our climate and imperil future generations,” said David M. Uhlmann, Assistant Administrator for EPA’s Office of Enforcement and Compliance Assurance. “This first-ever administrative complaint for the unlawful import of super-polluting HFCs advances EPA’s National Enforcement and Compliance Initiative on Mitigating Climate Change and demonstrates how EPA intensifying its efforts to prevent the illegal importation of HFCs.”
USA Wholesale attempted to illegally import 34,480.3 pounds of HFC-134a, which is a potent greenhouse gas with a 100-year global warming potential of 1,430. EPA issued a letter recommending that Customs and Border Patrol deny the shipment entry into the U.S., and the HFCs were subsequently exported. If released into the atmosphere, these HFCs are the equivalent of 22,365 metric tons of carbon dioxide (“CO2”) or the same amount of CO2 produced from powering 4,414 homes with electricity for a year.
The complaint seeks a ruling by the administrative law court that USA Wholesale’s importation and failure to submit required reports to EPA constitutes violations of the AIM Act and seeks civil penalties.
HFCs are a super climate pollutant with global warming potentials hundreds to thousands of times higher than CO2. The Kigali Amendment to the Montreal Protocol, adopted in 2016, is expected to avoid up to 0.5°C of global warming by 2100.
Since January 2022, EPA and CBP have denied entry to over 80 shipments of illegal HFCs. Under EPA’s HFC phasedown regulations, importers must expend allowances to import HFCs. Illegal imports of HFCs undermine the phasedown, disadvantage companies who follow the rules, and contribute to global warming.
Achieving the goals of the HFC phasedown also requires accurate data. Thus, in addition to preventing illegal imports of HFCs, EPA is also using its enforcement authorities to target HFC importers that fail to accurately report their import quantities to EPA. The agency will continue to scrutinize the reporting data to ensure that it and the public have the best data available to make informed decisions on fighting climate change.