IGas Holdings, Inc. v. EPA

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Less than two months after denying challenges to a U.S. Environmental Protection Agency (EPA) rule setting an allocation methodology for hydrofluorocarbon (HFC) allowances for 2024 through 2028 as part of the cap-and-trade program to implement the HFC phasedown required by the American Innovation and Manufacturing Act (AIM Act), the D.C. Circuit Court of Appeals denied a petition for panel rehearing or rehearing en banc filed by a company that imports, produces, and sells refrigerants. No member of the court requested a vote on the petition for rehearing en banc.

The D.C. Circuit Court of Appeals upheld a U.S. Environmental Protection Agency (EPA) rule setting an allocation methodology for hydrofluorocarbon (HFC) allowances for 2024 through 2028 as part of the cap-and-trade program to implement the HFC phasedown required by the American Innovation and Manufacturing Act (AIM Act). The court rejected a claim that the AIM Act unconstitutionally delegated legislative power to EPA, finding that “Congress provided ample direction to guide the EPA’s exercise of discretion” in deciding how to allocate the HFC allowances. The court also found that EPA used a reasonable allocation methodology.

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The D.C. Circuit denied EPA’s motion to hold in abeyance cases challenging EPA’s final rule regarding the allowance allocation methodology for 2024 and later years that will be used to implement the phasedown of hydrofluorocarbons under the American Innovation and Manufacturing Act. The petitioners and intervenor-respondents had opposed the abeyance motion. The intervenors argued that the constitutional questions raised by the petitioners were for the court, not EPA, to decide; that the court’s opinion on the legality of EPA’s methodology was of “crucial importance” to regulated entities on an ongoing basis; and that the case, for which oral argument had already been held, was ripe for decision. The petitioners argued that the requested abeyance could interfere with the court’s ability to grant meaningful relief in time for future compliance periods; they also argued that EPA’s “generic allegation that a new administration might revise its past decisions is too vague and speculative to justify delay of this proceeding.”

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