FEDA NEWS & VIEWS
INDUSTRY INSIGHTS
Understanding the Outlook on Equipment Regulations
Managing evolving standards and testing requirements is essential for manufacturers to maintain competitiveness.
The constant introduction of new regulations and requirements can be a lot for any business to keep up with, but foodservice equipment manufacturers are often held to even higher standards as we must meet increasingly strict
energy and testing targets while still complying with rules for safety and sanitation. Commercial refrigeration equipment (CRE) is a great example of this balancing act, as legislative and regulatory rulemaking routinely demand greater environmental efficiencies even as end users are most interested in how well the equipment can perform the critical task of preserving the safety and quality of perishable foods. Since they are the ones who ultimately sell the equipment, dealers are similarly affected by every regulatory update, which is why understanding and managing evolving regulations is essential for all parts of the industry to maintain competitiveness. Take the Environmental Protection Agency (EPA), for example. The agency is heavily influential in refrigerated equipment, regulating refrigerants for cooling systems and foam insulation. The 2020 American Innovation and Manufacturing (AIM) Act authorized the phase down of hydrofluorocarbons (HFCs), which are potent greenhouse gases commonly used as refrigerants. To stay in compliance, CRE manufacturers are transitioning systems to low global-warming-potential (GWP) refrigerants. But this change creates other hazards. Most of these alternatives are flammable or semi-flammable and require specialized production equipment and components to ensure safety. Manufacturers must also use foam insulations with a low- GWP blowing agent, which can require significant capital investments for production — ultimately leading to higher product prices for the end user. The phasedown of HFCs is scheduled to continue through 2036, so EPA regulations will continue to evolve.
Like other equipment categories, the Department of
Energy (DOE) establishes energy test procedures and standards for refrigeration equipment. The last big shakeup occurred in 2017 when the DOE reduced the amount of daily energy refrigeration equipment could consume. These stringent requirements forced manufacturers to redesign product lines and, in some cases, models were discontinued
6 FEDA News & Views
entirely because they could not meet the revised energy restrictions while maintaining proper performance. The industry could soon see an even greater upheaval, as the DOE has proposed new CRE standards that reduce energy consumption by another 60 percent or more for some products. The vast majority of models currently certified and listed on DOE’s website would not meet the new requirements. Several manufacturers are working with industry associations, including the North American Association of Food Equipment Manufacturers (NAFEM), to analyze the proposals and provide feedback to the DOE. These manufacturers have universally expressed significant concerns regarding the agency’s analysis and the extreme energy reductions proposed. Hopefully, that input will be taken into account if the DOE publishes a final rule in November 2024, as expected. Fortunately, there is reason to believe the DOE and
other regulatory agencies may be cautious with new rules going forward. The Supreme Court’s recent Loper Bright ruling represents a significant change in the judicial review of administrative actions and rulemaking. The Chevron doctrine previously required courts to defer to federal agencies, including EPA and DOE, to interpret ambiguous laws. However, the Loper Bright decision overturns this precedent and grants federal courts greater authority to independently interpret statutes. Agency expertise is still relevant, but courts can now question agency interpretations that were previously protected by Chevron. This will likely increase challenges to federal rulemaking by industry and possibly by advocacy groups. See page 16 in this issue of FEDA News & Views to learn more about the impact of the Loper Bright decision. Properly navigating the regulatory landscape and advocating for fair and reasonable regulations remains essential for foodservice equipment manufacturers and the dealers that sell their products. By staying informed, collaborating with industry associations, having their voices heard, and proactively addressing regulatory challenges and opportunities, manufacturers and dealers can ensure continued growth, innovation and leadership in the marketplace.
Jeff Bauman is the manager of regulatory affairs for Continental Refrigerator and a member of the FEDA Advocacy Council.
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