The AIM Act Extension: What it Means for Grocery Retailers

As federal rules go into effect that restrict the use of hydrofluorocarbons (HFCs), small- and medium-sized retailers should be aware of what it will take to overhaul their refrigeration systems.

The AIM Act, a federal regulation that will impact the use and availability of many common refrigerants, was set to go into effect in early 2025 but has been delayed by two years. While it may be tempting to take this news as a reason to postpone decisions about how to comply with the new rules, preemptive actions taken now can help reduce complications and costs down the line.

About the AIM Act

Passed by Congress in 2020, the American Innovation and Manufacturing (AIM) Act addresses hydrofluorocarbons (HFCs) — potent greenhouse gases used for air conditioning and refrigeration — in three main ways: phasing down the production and consumption of listed HFCs, managing those HFCs and their substitutes, and facilitating the transition to new technologies. With a global warming potential (GWP) that can be thousands of times more potent than carbon dioxide (CO2), phasing out HFCs is a critical step in combating climate change.

The AIM Act regulations took center stage at the 2023 FMI Energy & Store Development Conference where I participated in a panel discussion with leading retailers, such as H-E-B and Target, to discuss the shifting regulations and compliance implementation. FMI and its members support the Environmental Protection Agency’s (EPA) efforts to phase out HFCs and have been working with stakeholders to educate and implement alternative refrigeration solutions, even before the federal regulatory measures were proposed.

With the EPA’s extension, the AIM Act will now go into effect January 1, 2027.

Retail/Grocery Industry Impacts

The AIM Act will prohibit the manufacture and import of products containing restricted HFCs, in most cases, and will prohibit the sale, distribution, and export of products containing restricted HFCs.

While larger retail companies — in particular those in states with HFC restrictions already in place — may have started their planning several years ago, there are more than 25,000 retailers in the United States with fewer than 30 stores that will now need to go through the same process to prepare for their future refrigeration needs.

Grocery retailers and companies with refrigerated warehouses, such as fulfillment and distribution centers, who utilize restricted HFCs will need to determine whether to replace or retrofit their systems with compliant refrigerants. Additionally, stores that use HCFCs or CFCs (other ozone-depleting chemicals used in refrigeration) will not comply with the new regulations, so now is a great time to learn about the alternatives.

Companies will need to consider the availability of any new equipment as well as the natural refrigerants themselves, and demand is likely to increase as we near the AIM Act implementation. As demand increases, manufacturers will need to keep pace, but availability now does not guarantee availability in the future.

With more changes to come, retailers with legacy systems such as direct expansion (DX) R22 may consider keeping those for as long as possible. But with general maintenance and declining refrigerant gas availability, it’s likely to become quite expensive to maintain those systems — and not practical to build new ones using old technologies.

Don’t Panic, Be Prepared: Options to Consider

Despite the two-year extension, we recommend our clients — and all impacted grocery retailers — start planning now if they haven’t already. This additional time can be used to research options, assess supply chains, and evaluate individual circumstances. Alternative systems are available, but deciding which is best for a particular store depends on factors such as reliability, capital investment (equipment cost and installation cost), maintenance and repair, and energy and water use.

Here are a few things to consider as you begin to review options — in terms of new systems and retrofitting existing systems.

New refrigeration systems. If you’re implementing a completely new system, the best option would be to choose a natural refrigeration system. With their low GWP, natural refrigerants meet AIM Act regulations; however, it’s important to investigate the following:

• Are there trained professionals in your area who can work on your natural refrigeration system? Equipment maintenance requires specialized training and while organizations such as the North American Sustainable Refrigeration Council and the EPA have been working to boost training and resources, there’s currently a shortage in the refrigeration technician workforce, thus it’s smart to identify who you’ll want to contract with as soon as possible.
• What natural refrigerants are readily available in your area? What will most likely be available for the long-term? You’ll need to consider both the supply chain and the storage impacts to determine a feasible solution for acquiring the gas prior to install as well as over the course of the system’s lifetime.
• Are your stores in hot or cold climates? Climate should be considered when considering which type of natural refrigeration system to select as there are technologies that can help reduce the amount of energy needed. For example, if your stores are in an area known for extremely hot weather, your best solution may not be a CO2 system but ammonia instead. System type and integrated technologies should be explored to find the best option for the climate in which your stores are located.
• What is your budget? Your system selection will include consideration of both power and controls. How much energy you use will impact your overall expenditures — both upfront costs and the costs over the lifetime of your system. In addition to energy use, the more components your system has, the more expensive it could be. Understanding your system components and any barriers to their availability could save hassles (and costs) down the road.

Remodeled refrigeration systems. Existing systems can be serviced, repaired, or retrofitted with many refrigerant options, but must have the following considerations:

• A1 refrigerants have been the standard refrigerant choice for years, but are being phased out of production. This type of refrigerant can be retrofitted to a lower GWP refrigerant to reduce the cost of certain refrigerants.
• A2L refrigerants are slightly flammable and cannot be retrofitted into existing refrigerated equipment. This type of refrigerant would require new equipment and a full system replacement.
• Natural refrigerants, such as CO2, also would require a full system replacement based on refrigerant compatibility issues in existing equipment.
• At this time, you can use existing equipment in a store remodel if you’re replacing the cases like for like. However, a system replacement is necessary if you’re increasing the cooling capacity, in BTU per hour, or replacing 75% or more of evaporators/cases (by number) and 100% of the compressor racks, condensers, and connected evaporator loads of an existing system.

While all this information can be complicated and feel overwhelming, there are experts and resources to help. One of Cushing Terrell’s specialty services is refrigeration engineering, and our team can help you understand what is needed for your particular situation. We’re also members of the North American Sustainable Refrigeration Council, another great resource for news and information about solutions to climate change through refrigeration management.

Stay tuned for part two of this AIM Act blog series, which will focus on two natural refrigeration systems: transcritical CO2 and cascade CO2/ammonia.