Breaking Down the EPA American Innovation and Manufacturing (AIM) Act

Enacted by Congress with bipartisan support in 2020, the American Innovation and Manufacturing (AIM) Act has long since come into force and thus affected the lives of any company or individual working with refrigerants, namely, hydrofluorocarbons (HFCs).

Through the AIM act, the EPA seeks to phase down production and consumption of HFC refrigerants, facilitate the transition to next-gen technologies, maximize HFC reclamation, and minimize HFC release from equipment. For each of these objectives, the EPA began a specific regulatory program: the Allowance Allocation and Trading Program for the first, the Technology Transitions Program for the second, and the Emissions Reduction and Reclamation Program (which targets the servicing, repair, disposal, and installation of equipment with HFCs) for the last two.

In this article, we will briefly present each of these programs and the responsibilities that fall onto refrigerant manufacturers and importers as of January 1st, 2025.

Table of Contents

List of HFC Refrigerants Being Phased Out by the EPA AIM Act
EPA HFC Allowance Allocation Program Overview
How the EPA Allocates Allowances
HFC Allowance Allocation Program Reporting Requirements
How to get more HFC Allowances
EPA Technology Transitions Program Overview
Technology Transitions Program Limits and Key Dates
Low-GWP Alternatives to AIM ACT HFCs
Emissions Reduction & Reclamation Regulations Overview
Resources and Assistance for EPA HFC AIM ACT Compliance

HFC Refrigerants Being Phased Out by the EPA AIM Act

Hydrofluorocarbons (HFCs) are a group of synthetic organic compounds containing hydrogen and fluorine atoms that have high Global Warming Potentials (GWPs) and, as a result of being saturated (i.e. only having single bonds between their atoms), remain in the atmosphere for a long time.

18 of the most commonly used HFCs are included in EPA's list of regulated substances in the AIM Act (see Appendix A to Part 84). Any of their isomers are also, by extension, regulated.

The EPA also assigns each of these HFCs an exchange value (EV) corresponding to the HFC's 100-year GWP, as listed in the 2007 IPCC Fourth Assessment Report. These are then used to calculate the number of allowances needed to produce or import a given amount of an HFC, with the underlying logic being that more polluting HFCs (with higher GWPs/EVs) require expending more allowances than less polluting ones. (See next section for more information.)

The full list of AIM Act-regulated HFC refrigerants is as follows:

1. HFC 134 -- CHF₂ CHF₂ -- EV: 1,100
2. HFC 134a -- CH₂ FCF₃ -- EV: 1,430
3. HFC 143 -- CH₂ FCHF₂  -- EV: 353
4. HFC 245fa -- CHF₂ CH₂ CF₃ -- EV: 1,030
5. HFC 365mfc -- CF₃ CH₂ CF₂ CH₃ -- EV: 794
6. HFC 227ea -- CF₃ CHFCF₃ -- EV: 3,220
7. HFC 236cb -- CH₂ FCF₂ CF₃ -- EV: 1,340
8. HFC 236ea -- CHF₂ CHFCF₃ -- EV: 1,370
9. HFC 236fa -- CF₃ CH2CF₃ -- EV: 9,810
10. HFC 245 ca -- CH₂ FCF₂ CHF₂ -- EV: 693
11. HFC 43-10-mee -- CF₃ CHFCHFCF₂ CF₃ -- EV: 1,640
12. HFC 32 -- CH₂ F₂ -- EV: 675
13. HFC 125 -- CHF₂ CF₃ -- EV: 3,500
14. HFC 143a -- CH₃ CF₃ -- EV: 4,470
15. HFC 41 -- CH₃ F -- EV: 92
16. HFC 152 -- CH₂ FCH₂ F -- EV: 53
17. HFC 152a -- CH₃ CHF₂ -- EV: 124
18. HFC 23 -- CHF₃ -- EV: 14,800

EPA HFC Allowance Allocation Program Overview

Arguably the most stringent program of the three, the EPA's Allowance Allocation Program forms the foundation of the AIM Act's HFC emissions reduction, as it aims to gradually lower production and consumption of HFCs to 15% of what they were in 2015 by 2036. More broadly, this effort is meant to contribute to a worldwide 80-85% reduction by 2047, in line with the 2022 ratification of the Kigali Amendment to the Montreal Protocol.

The way it works is quite simple. Every year, the EPA issues every HFC-producing and HFC-consuming entity a set number of non-refrigerant-specific allowances, granting them permission to produce or import bulk HFCs throughout that calendar year. These allowances act as a unit of measurement equivalent to one metric ton of exchange value (MTEVe), i.e., to one metric ton of CO₂e. To produce or consume bulk HFCs (that is, regulated HFCs in a container for transportation or storage, such as service cans, drums, ton tanks, etc.), an entity must expend their allowances according to the exchange values (EVs) in the list above, meaning HFCs with higher EVs will cost more allowances than those with lower EVs.

(NOTE: Regulated substances contained in a manufactured product, such as an aerosol can, a foam, or an appliance, are not considered bulk substances and instead fall under the regulations of the Technology Transitions Program.)

For example, an entity that wants to purchase 100 kilograms of HFC 125 would have to spend 350 allowances, given that 100 kg x 3,500 (the HFC's EV) is equal to 350 tons of MTEVe. If that same entity opted for 100 kilograms of HFC 41 instead, it would only cost them 9.2 allowances (100 kg x 92 EVe, converted into metric tons).

Over time, the EPA will lower the number of allowances allocated every year in a stepwise manner (as outlined in the graph below), thereby ensuring entities as a whole are reducing their production and consumption of HFCs in line with the baseline reduction goals.

One last detail to keep in mind is that entities are responsible for calculating the correct number of allowances they must expend for every kilogram of HFC they wish to produce and/or import. The EPA does, however, provide a free calculator to help with this determination; it is available as a downloadable xlsx file on the HFC Allowances webpage.

(NOTE: Do not use the EPA's GHG Equivalency calculator for the purposes of allowance calculation. It has recently been updated to use AR5 GWP values, on which the AIM Act does not rely.)

HFC Allocation Rule: How the EPA Allocates Allowances

The EPA issues allowances on October 1st of each year for use throughout the following calendar year. The number of production and consumption allowances they issue will gradually decrease relative to the baseline, as shown in the graph above.

To calculate the baseline, on which the reductions are based, the EPA aggregated the total metric tons of CO₂e released by the production and consumption of bulk regulated substances from 2011 through 2021. They arrived at an average annual value of 302.5 million MTEVe for consumption and 382.5 million MTEVe for production. These values, when multiplied by the percentage of baseline emissions allowed for a given time period (ex: 60% for 2024 to 2028, in line with graph above), provide the EPA with consumption and production allowance caps, from which allowances are then distributed among HFC-producing and HFC-consuming entities.

Country-wide HFC Consumption and Production Allowance Caps

For 2024 to 2028, the EPA intends to allocate annual allowances based on each individual entity's three highest (not necessarily consecutive) years of HFC production and consumption between 2011 and 2019. That high three-year average determines the proportion of allowances an entity is to be allocated relative to the sum of all entities' high three-year average and the number of generally available allowances.

The "problem" is, that last part of the equation—the number of generally available allowances—is always changing. For instance, given that allowances are first issued to application-specific allowance holders and that the number of application-specific allowances issued in 2025 was higher than in 2024, the number of available general pool allowances, and therefore the number that each entity in that pool received, was lower.

In other words, entities cannot simply look at the amount of allowances they received in previous years as an indication of the amount they will receive going forward, even though they should expect a reduction every few years (if not year-over-year).

HFC Allowance Allocation Program Reporting

Any entity that produces, imports, exports, recycles for fire suppression, destroys, uses as a feedstock, reclaims, packages, or otherwise distributes HFC refrigerants must submit Microsoft Excel-based reporting forms to the EPA every quarter through their electronic Greenhouse Gas Reporting Tool (e-GGRT).

Quarterly reports are due 45 days after the end of each quarter.

• Quarter 1 reports (January 1^st - March 31^st) are due May 15th
• Quarter 2 reports (April 1^st - June 30^th) are due August 14th
• Quarter 3 reports (July 1^st - September 30^th) are due November 14th
• Quarter 4 reports (October 1^st - December 31^st) are due February 14th (of the following year)

Reporters must also contract a third-party CPA to conduct an annual agreed-upon procedures engagements audit, due May 31^st of each year.

Forms and reporting instructions are available on the EPA's Reporting and Recordkeeping Resources webpage.

How to Get More EPA HFC Allowances

If you do not have enough allowances to satisfy your demand for bulk HFC production and consumption in a given year, you may undertake one or more of the following three actions:

1. Purchase HFC refrigerants from domestic suppliers, as doing so does not require expending allowances
2. Obtain allowances from an existing allowance holder (see full list on the EPA website) through an allowance transfer, then report the transfer through the EPA's HAWK system so that the EPA may approve it (via a non-objection notice)
   • Entities transferring their allowances to others should keep in mind the 5% offset per transfer (e.g. a transfer of 100 allowances to another company will cost 105 allowances)
3. Or, if you are not out of allowances on the current year but are expecting a shortage in following years, you can expend unused allowances to build HFC inventory for future use
   • This is a good rule of thumb in general since allowances for a given year expire on December 31^st of that year and therefore do not carry forward; you are unable to expend, transfer, or confer unused allowances after that date

EPA Technology Transitions Program Overview

Like the Allowance Allocation Program, the Technology Transitions Program is meant to reduce the impact of HFC refrigerants in the environment. The key difference is that it does so by setting regulations on HFC-containing products and equipment rather than on bulk HFC production and consumption by national entities.

In a nutshell, the program restricts the use of HFCs in sectors where lower-Global Warming Potential (GWP) alternatives are already available (or will be in the near term): aerosols, foams, and refrigeration, air conditioning, and heat pumps (RACHP) sectors. The RACHP sector is of particular importance to the program's success, as roughly 75% of total HFC use in the United States is associated to refrigeration and AC in buildings.

The program is designed to facilitate the transition to these next-gen, lower GWP technologies and is therefore forward-looking, in the sense that it does not affect existing products and systems (i.e. those currently installed or in use).

You may continue to use and repair your, say, air conditioning systems and ice rinks, even if reparation requires replacing a major component (such as a condensing unit or compressor) and/or overseas shipment. Similarly, entities can continue to sell and purchase components manufactured with a high-GWP HFC provided they are used exclusively for servicing legacy systems; the component's label must read "for servicing existing equipment only".

(NOTE: Spray and pour foams used in space vehicles and applications eligible for application-specific HFC allowances are also exempted from this rule).

Entities that wish to manufacture, import, sell, distribute, install, or export new products and equipment that use or are intended to use HFCs or HFC blends must:

• Use HFC refrigerants or HFC blends that meet GWP limits for each subsector (see next section)
• Label the products and equipment appropriately (see the EPA's Labeling Fact Sheet for detailed information)
  • The information that must be present on the fact sheet varies slightly depending on the type of equipment, but it generally includes the name or designation of the intended HFCs or HFC blends, the manufacture date, the charge size, and the date of charge
• Report annually to the EPA on the type and quantity of HFCs used
  • Reporting obligations begin on March 31st, 2026, with 2025 data, and does not apply to entities that only sell or distribute equipment or install or operate new RACHP systems

For a more detailed overview of the program's requirements, read the EPA's Technology Transitions Fact Sheet.

EPA Technology Transitions Program: Limits and Key Dates

The EPA lists 68 different subsectors within the three targeted sectors, each with its own GWP limit and compliance date. These are too many to enumerate in a single article, so we have instead listed those with January 1^st, 2025 compliance dates. Make sure to look at the restriction tables on the EPA's Restrictions by Sector webpage for the full list.

Two subsectors that also have January 1^st, 2025 compliance dates but are not included in the list above are the road systems and self-contained products for refrigerated transport subsector and the marine systems and self-contained products for refrigerated transport subsector. Rather than abiding by a strict GWP limit, these two subsectors are prevented from using a defined list of HFC substances: R-402A, R-402B, R-404A, R-407B, R-408A, R-410B, R-417A, R-421A, R-421B, R-422A, R-422B, R-422C, R-422D, R-424A, R-428A, R-434A, R-438A, R-507A, R-125/290/134a/600a (55/1/42.5/1.5), RS-44 (2003 formulation), and GHG-X5.

Another crucial detail worth mentioning is that products in the self-contained RACHP sector that are above the GWP limit can continue to be sold, distributed, and exported up until three years after the compliance date (e.g. until January 1st, 2028 for those listed above). This extension acts as a sell-through period for any products that were manufactured or imported before the new rule was passed.

Technology Transition Limits for Industrial Process Refrigeration

One subsector that is a little tricky to figure out by simply reading the restriction tables is the Industrial Process Refrigeration sector (chillers excluded), given that the GWP limits for this sector differ drastically depending on the temperature at which the refrigerant enters the evaporator.

In short, there are no GWP restrictions if the refrigerant enters the evaporator at a temperature below -58 °F (-50 °C), a GWP limit of 700 starting January 1^st, 2028 if the refrigerant enters at a temperature between -58 °F and -22 °F, and various limits if the refrigerant enters at -22 °F or higher.

Now let's expand on the last part of the previous sentence. If the refrigerant entering at a temperature at or above -22 °F does so with a refrigerant charge below 200 pounds, the GWP limit is set at 300 and the compliance date is January 1^st, 2026. If the refrigerant charge is 200 pounds or more, then the limit stays at 300 only if the cascade is on the high temperature side of the system; if it is on the low temperature side or there is no cascade (single stage), the limit goes down to 150.

Please refer to our handy table below for a visual breakdown of the different GWP limits for the industrial process refrigeration subsector.

Technology Transition Limits for Homeowners

If your single-family home or small commercial building has cooling equipment of its own, don't worry, there is still time to become AIM Act-compliant.

These AC systems fall under the "residential and light commercial" subsector and therefore should operate under the 700 GWP limit as of the January 1^st, 2025 compliance date. However, the EPA is allowing new systems with a GWP above 700 to be installed until January 1st, 2026, provided they are not stationary (e.g., not window units or portable room AC) and all of their components are manufactured or imported before the year 2025.

Legacy systems (R-410A unitary condensing units, for example) can continue to be repaired throughout their useful life, unless both the condensing unit and the indoor coil need to be replaced simultaneously. This kind of replacement is considered equivalent to the installation of a new system (even if the existing refrigerant lines are left unchanged) and would therefore require the use of a refrigerant with a GWP < 700.

Lastly, it's worth noting that higher-GWP variable refrigerant flow systems can be installed until January 1^st, 2027, as long as all of their components are manufactured or imported before the year 2026.

Low GWP Alternatives to AIM Act HFCs

The existence of the Technology Transitions Program implies that hydrofluorocarbons with low global warming potentials to which producers and consumers can feasibly transition within the compliance timeline must exist.

One group that is actively pushing for their uptake is the International Institute of All-Natural Refrigeration (IIAR). According to the scientists and experts they queried, there are several low-GWP alternatives that exist in nature, are environmentally friendly, and have no blended elements regulated by the AIM Act: carbon dioxide (including captured CO₂), propane, hydrocarbons, and ammonia (which, apart from a 0 GWP, has the added benefit of an extremely low leak rate).

These alternatives are also cheaper (compared to common HFCs), have no effects on the ozone layer, and are future-proof, in that, thanks to their low GWPs, they would never be legislated against. The same cannot be said about highly regulated synthetics like HFOs—while they may offer a short-term response to the AIM Act, they are steadily being banned in Europe and, therefore, cannot be considered a long-term solution.

Apart from these alternatives, there are a handful of HFCs that already fall below the AIM Act's limits. The IIAR has prepared a helpful graphic that lists common refrigerants available in the market by GWP relative to the new EPA limits (per compliance group); we found it such an amazing resource that we had to include it below.

HFCs, HFOs, HFC/HFO Blends, and all-natural refrigerants by GWP (adapted from IIAR's AIM Act Fact Sheet)

If your refrigeration system currently uses a high-GWP HFC and is at risk of becoming obsolete, the IIAR recommends you audit the system, consider your options for transitioning to low-GWP technologies, and ask manufacturers and suppliers listed in the Natural Refrigeration Directory for support.

Emissions Reduction and Reclamation Regulations Overview

The last set of policies included in the AIM Act fall under the Emissions Reduction and Reclamation (ER&R) Program. These are regulations that control the servicing, repair, disposal, and installation of HFC-equipment in order to maximize refrigerant reclamation, minimize the release of regulated substances, and ensure the safety of technicians and consumers.

The ER&R program targets entities that own, operate, service, repair, recycle, dispose, or install HFC-containing equipment (or their substitutes) across four industrial activities: leak reparation, refrigerant reclamation, fire suppression, and cylinder disposal. We briefly dissect each one below; see the EPA's ER&R Fact Sheet for even more information.

Leak Repair

Provisions for leak reparation will begin January 1st, 2026 and apply to all appliances with a full charge ≥ 15 pounds of an HFC (or substitute) with a GWP > 53.

Owners and operators of these appliances must conduct a yearly inspection and repair all identified leaks when retrofitting the appliance (i.e. when converting it to use another refrigerant/achieving system compatibility with the new refrigerant). They must also ensure that the leak rate is below the threshold applicable to their subsector:

• Industrial process refrigeration: 30%
• Commercial refrigeration: 20%
• Comfort cooling, refrigerated transport, and other appliances not covered: 10%

New large appliances in the industrial process refrigeration or commercial refrigeration subsectors with full charges ≥ the 1,500 pound size threshold must also be installed with and make use of an ALD system (direct or indirect). Existing appliances have a one-year extension on the compliance date (meaning they must install and use the system by January 1^st, 2027).

Appliances in the residential and light commercial RACHP subsector are excluded from these requirements. Systems use solely for comfort cooling are exempted from ALD system installation and use.

Refrigerant Reclamation

The refrigerant reclamation portion of the ER&R Program boils down to a reclamation standard that states that HFC refrigerants sold, identified, or reported as reclaimed in the US may only contain ≤ 15% virgin HFCs by weight. For blends, that 15% maximum applies as a total, rather than per HFC in the blend.

From January 1^st, 2026, EPA-certified reclaimers must certify that the contents of any containers sold or distributed (or offered for sale or distribution) meets the reclamation standard. They must affix a label to these containers communicating this fact and generate a record maintained at the batch level for three years (from the date of generation).

Refrigerant-containing equipment in the supermarket systems, refrigerated transport, and automatic commercial ice makers subsectors of the RACHP sector do not have to comply with this standard for servicing and/or repair until January 1^st, 2029. Reclaimers and refrigerant suppliers who sell or distribute reclaimed HFCs for service and/or repair to entities in these subsectors are also subject to further reporting requirements. Reports are due February 14^th of 2027 and 2028 and must include the quantity of HFC and the specific subsector(s) to which it was sold or distributed, among other key details.

(NOTE: The reclamation standard does not apply to non-HFC components, including HFC substitutes.)

Fire Suppression

The requirements for fire suppression apply to all entities that own/operate or install, service, repair, or dispose of fire suppression equipment containing HFC refrigerants. Different stipulations come with different compliance dates, as follows:

• Starting January 1^st, 2026, regulated entities must:
  • Minimize HFC releases during installation, servicing, repair, or disposal of equipment
  • Service and/or repair equipment with recycled HFCs
  • Recycle HFCs prior to the disposal of equipment
• By June 1^st, 2026, regulated entities must provide obligatory training on HFC emissions reduction to employed technicians
  • After the compliance date, technicians must be trained within 30 days of hiring
• Annually, starting February 14^th, 2027, regulated entities must submit annual reports on the prior calendar year's activities, including:
  • First fill of equipment
  • Service (such as recharge)
  • Recycle of regulated substances recovered from equipment
  • Sale or holding in inventory of HFCs for the purpose of installation and/or repair of equipment (records must be maintained for three years)
• Starting June 1st, 2030, regulated entities must install new equipment containing HFCs (including total flooding systems and streaming applications) with recycled HFCs

Refrigerant Removal from Cylinder Disposal

Starting January 1^st, 2028, HFC-containing disposable cylinders must be sent to an EPA CAA Section 608-certified reclaimer, a fire suppressant recycler, or a final processor (e.g., a landfill operator or scrap metal recycler) or refrigerant supplier capable of removing the heel for the cylinders' remaining contents to be removed.

This applies unless an EPA CAA section 608-certified technician evacuates the disposable cylinder to a vacuum level of 15 in-Hg. The technician must also provide a certification statement to the final processor.

Small cans are not covered by these provisions.

Resources and Assistance for EPA HFC AIM Act Compliance

There is a lot more to the AIM Act than what we can fit in a single blog article. If you work with any number of the 18 regulated HFCs in any of the processes described above (production and consumption of bulk HFCs, refrigeration equipment installation, refrigerant reclamation, etc.), you should certainly consider furthering your understanding of the rule with some additional reading.

The final rule in the Federal Register is, naturally, the ideal knowledge base, but very few people have the time and patience to read it. Instead, you can refer to the HFC Reduction hub and the FAQs on the Phasedown of HFCs on the EPA website for topic-specific breakdowns of all the AIM Act's sections.

There are also a multitude of fact sheets that neatly summarize the main points presented here, such as the three program-specific ones scattered throughout the article above or this fact sheet from Opteon that presents the high-level actions and objectives of the AIM Act as a whole.

Of course, you could do away with the need to do your own research by enlisting the help of a team of experts to do it for you... at no extra cost. This is a guarantee that we have built into our Refrigerant Management software, powered by our in-house H&S experts who regularly keep up with EPA regulations on behalf of our clients.

For example, we recently incorporated GWP values into our service record forms as added conditions that are automatically checked for exceedances. With this foundation and a compilation of leak rate data, the software can easily determine whether your appliances with full charges above 15 pounds require yearly inspections or are operating below their subsector thresholds.

We always strive to improve our never-versioned software to stay as up to date as possible, going as far as building specific functionalities based on the needs of our clients, as we are currently doing with our upcoming features for disposable cylinder management.

Don't hesitate to schedule a discovery call with us today to discuss how we can help you stay in compliance with all AIM Act programs and provisions, now and into the future.

Contributing Scientist: