EPA Caps HFCs for 2026 to Save the Planet, Business as Usual
Published Date: 11/20/2025
Notice
Summary
The EPA is setting the 2026 limits on how much hydrofluorocarbons (HFCs) companies can produce and use, following the AIM Act’s phasedown plan to protect the environment. Some companies faced penalties that cut their 2026 allowances, so they’ll have less HFCs to work with. These changes start January 1, 2026, helping push the U.S. toward cleaner air while keeping industry on track.
Analyzed Economic Effects
6 provisions identified: 3 benefits, 3 costs, 0 mixed.
Application-Specific Allowances Allocated
EPA allocated application-specific allowances for 2026 to named end users across four applications (MDI propellants; structural composite foam for marine and trailer use; semiconductor etching/cleaning; onboard aerospace fire suppression) and to the Department of Defense for mission-critical military end uses. The notice lists entity-specific allocations (for example, Kindeva 653,490.0 MTEVe, Intel 479,420.4 MTEVe, and DoD 6,156,958.5 MTEVe).
2026 National HFC Caps Set
EPA set national caps for 2026: total production allowances may not exceed 229,521,263 MTEVe and total consumption allowances may not exceed 181,522,990 MTEVe. These caps limit the total amount of regulated hydrofluorocarbons that can be produced or consumed in the U.S. in calendar year 2026.
MDI Set-Aside and Application Deadline
EPA set aside 1,000,000 MTEVe from both production and consumption pools for unforeseen public health or healthcare needs related to MDIs. Entities that use HFCs as propellants in metered dose inhalers may apply for these allowances until April 30, 2026; EPA expects to issue requested allowances within 60 days after that date and to distribute any remaining set-aside pro rata within 60 days.
Withheld, Revoked, and Retired Allowances
EPA took final administrative consequences effective September 30, 2025, withholding, revoking, or retiring allowances for specific entities. Examples include revocations of 78,551.8 MTEVe for IGas Holdings, 6,249.1 MTEVe for Matheson Tri-Gas, and withholding 2,815.0 MTEVe from Wolfspeed; MEK Chemical Corporation had 10,415.0 MTEVe withheld and 1,486.7 MTEVe retired.
Revoked Allowances Redistributed to Eligible Holders
For 2026, EPA reports 1,068,198.7 MTEVe of revoked and redistributed consumption allowances apportioned to eligible consumption allowance holders based on relative market share, and 64,161.5 MTEVe of retired allowances. Revoked allowances are redistributed to eligible general pool holders (excluding entities subject to the revocation on the same day).
2026 Allowances Usable Only In-Year
EPA states that calendar year 2026 allowances may only be expended to cover imports and production between January 1, 2026 and December 31, 2026; although allowances may be transferred after allocation, they cannot be used outside the calendar year for which they are issued.
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