As HFCs are Phased-Down, Disincentives for Ammonia Must be Avoided

With the passage and ongoing implementation of the American Innovation and Manufacturing (AIM) Act at the federal level, some states are also taking actions to phase
down hydrofluorocarbons (HFCs). As policymakers move away from HFCs, it is also important that ammonia policies be kept in an appropriate balance, to avoid unintended consequences of policies that may serve as disincentives for facilities to move to natural refrigerants. A good example of such policies can be found in the State of New Jersey.

The New Jersey Department of Environmental Protection (NJDEP) has initiated a rulemaking to begin its process to phase down HFCs. The rulemaking, Docket Number: 06-21-05 Proposal Number PRN 2021-058 Greenhouse Gas Monitoring and Reporting, focused on establishing a baseline of HFC use, monitoring, and reporting. The International Institute of Ammonia Refrigeration (IIAR) provided oral comments during an NJDEP public meeting and also submitted written comments regarding the
state’s policies. IIAR comments focus on the importance of a holistic look at New Jersey state policies and the removal of disincentives for companies to transition from (HFCs) to natural refrigerants such as anhydrous ammonia.

IIAR shares NJDEP’s goal of reducing emissions of greenhouse gases with high global warming potential. However, in addition to the current rulemaking being considered, the State of New Jersey should address current barriers to companies wanting to transition from HFCs to anhydrous ammonia. The use of natural refrigerants such as anhydrous ammonia will play an important role in providing climate-friendly refrigeration solutions. The majority of industrial refrigeration facilities in the United States already utilize anhydrous ammonia as their primary refrigerant. Industry overwhelmingly chooses ammonia because it is the most efficient refrigerant for industrial applications. The one exception to the widespread use of ammonia is the State of New Jersey. The Toxic Catastrophe Prevention Act (TCPA) and the New Jersey Refrigeration Operator licensing requirements, as they currently apply to ammonia refrigeration systems are the most restrictive in the United States and serve as strong disincentives for facilities to move away from HFCs. 

IIAR estimates that the initial cost to come into compliance under the TCPA is approximately $32,500 and the annual cost after that is over $21,000. It is important to note that the TCPA comes on top of the U.S. Environmental Protection Agency’s Risk Management Program (RMP) and the U.S. Occupational Safety and Health Administration’s Process Safety Management requirements. Because federal regulations are in place to address the very same hazards as TCPA, there will be no diminishment in safety to workers or the environment should anhydrous ammonia be removed from the TCPA.

The second barrier is the New Jersey Refrigeration Operator licensing requirement that mandates a 24-hour Gold Seal operating engineer. New Jersey is the only state with such licensing requirements, which place a significant economic burden on facilities using ammonia as an industrial refrigerant. Requirements for trained Refrigeration Operators in Federal regulations such
as PSM and RMP already ensure that qualified personnel are operating ammonia refrigeration systems. Additionally, the requirements do not take into consideration the increased automation
and safety features built into modern ammonia refrigeration systems. Current rules for gold seal operators were implemented long before automation and other widely adopted safety features were prevalent. On average, it is estimated that these licensing requirements result in a minimum of $100,000 in additional costs annually for facilities in New Jersey.

Combined, the TCPA and operator licensing requirements cost facilities in New Jersey using anhydrous ammonia over $120,000 more annually than their counterparts in neighboring states. These policies provide a direct deterrent to facilities looking to transition from HFCs to ammonia and put the State of New Jersey at a disadvantage when competing for jobs and economic
growth. These policies continue to take a toll on the growth of the refrigerated warehousing industry in New Jersey, as well as the broader food sector.

As the State of New Jersey and other jurisdictions move forward with policies designed to reduce the use and emissions of HFCs, removing unnecessary regulatory burdens on ammonia would eliminate major disincentives for companies wanting to transition from HFCs to a natural refrigerant with zero global warming potential. This will be an important consideration as US EPA
and OSHA look at potential revisions to the Risk Management Program and Process Safety Management regulations. IIAR will continue to work with policymakers to promote the use of
natural refrigerants and advocate for the appropriate balance of policies to avoid any potential disincentives for the transition to ammonia.