As part of a massive deregulation effort announced Wednesday, the Environmental Protection Agency said it is reconsidering refrigerant requirements that impact grocers.
Both FMI — The Food Industry Association and the National Grocers Association separately praised the EPA’s deregulation announcement, saying the agency is taking steps to reduce regulations that burden grocers.
“[The] EPA’s actions can now free up resources for independent grocers to focus on improving store operations, expanding local job opportunities, and keeping grocery prices affordable for American families,” NGA Chief Government Relations Officer Chris Jones said in a statement.
But how exactly the deregulation effort impacts supermarket operations remains unclear, three sources said.
The agency said it will examine the technology transitions rule, which sets limits on the use of hydrofluorocarbons in specific sectors, including refrigeration, air conditioning and aerosols. The rule required new commercial refrigeration systems to begin using low global warming potential refrigerants with sector-specific timelines between 2025 and 2027, and for grocers to be compliant by Jan. 1, 2027.
The EPA said its reconsideration of the rule will give companies time “to successfully transition to new solutions from U.S. chemical and manufacturing companies for the affected commercial and industrial refrigeration uses.”
Jonathan Tan, co-founder of Ratio Institute, a nonprofit specializing in grocery sustainability, said the announcement raises numerous questions, including which parts of the rule the agency is trying to amend.
“I’d like to see exactly what they mean by the rollback, because there are no specifics,” Tan said, noting that the rule is complex and has different requirements for different sectors.
The EPA’s Technology Transitions rule is one of three components under the American Innovation and Manufacturing Act, which President Donald Trump signed into law during his first presidential term and which requires the EPA to phase down the production and consumption of HFCs by 85% below historical baseline levels by 2036.
Sources said it appears the HFC phasedown isn’t impacted by the EPA’s announcement but were divided on whether automatic leak detection requirements — the final part under the AIM Act — are affected.
“From what we understand, the EPA is considering changes to the Technology Transitions rule to either loosen or delay requirements forcing end-users to transition to low-GWP refrigerants,” said Amrit Robbins, CEO of Axiom Cloud, which uses AI and automation to detect refrigerant leaks for grocery retailers and cold storage facilities.
What now?
FMI President and CEO Leslie Sarasin said grocers face “unrealistically tight implementation timelines” under the EPA’s rule.
However, if the agency does do away with the required timeline, grocers will still probably want to move away from HFCs, multiple sources said.
That’s because the cost of HFCs will go up as the supply becomes limited due to the phasedown, said Aaron Daly, a former director of energy management at Whole Foods Market and principal of Avida Energy, which provides services for renewable energy. As a result, grocers will likely make more investments in low-GWP refrigerant alternatives, he said.
Because a large amount of HFCs come from China, the costs of HFCs may increase if the U.S. implements tariffs on certain imported materials and goods, said Tan.
Daly said grocers also need to be mindful of state laws that have placed restrictions on refrigerants, such as California’s. New York, Washington state and several other states also may put in place their own regulations, he noted.
“The expectation that grocers will immediately not have to worry about [investing in low-GWP solutions] and not have to forecast for it, it is … high hopes for those that might want to go a different path,” Daly said. “The announcement injects a level of uncertainty, more than it does anything else, into the process.”
FMI said it wants a “thorough evaluation of the rule in its current form” to prevent grocery stores from paying “billions,” noting that grocers face implementation challenges due to a lack of available technology, installers and other factors.
While the reconsideration of the rule may give retailers more flexibility in how and when they transition to new refrigerant systems — potentially lowering immediate capital expenditure pressures — the industry is “trending toward implementing comprehensive refrigerant management strategies that go beyond minimum compliance and stay ahead of existing state and forthcoming federal enforcement,” Robbins said.
If grocers were to ask for his guidance, Daly said he would tell them to plan a comprehensive phasedown schedule for HFCs and switch to ultra-low GWP refrigerants for new and existing stores.
“If they wait, delay and take action at the last minute, it’s going to cost more, and it’s going to get complicated,” Daly said.
