On November 21, 2018, the EPA announced it was taking comment on a 2-year sell-through provision for wood stoves and on other issues in the 2015 wood heater regulation. The Alliance for Green only submitted comments on the 2-year sell-through that would allow manufacturers to build and sell Step 1 wood and pellet stoves that emit up to 4.5 grams an hour and retailers to see them until June 15, 2022. All stakeholder comments will be available to the public by going to www.regulations.gov and typing in EPA-HQ-OAR-2018-0196.
Comments of the Alliance for Green Heat
The United States Environmental Protection Agency
Comments on the Advance Notice of Proposed Rulemaking; Standards of Performance for New Residential Wood Heaters, New Residential Hydronic Heaters and Forced-Air Furnaces
Docket No. EPA-HQ-OAR-2018-0196
Feb. 13, 2018
The Alliance for Green Heat (AGH) offers the following comments on the U.S. Environmental Protection Agency’s (EPA) Advance Notice of Proposed Rulemaking (ANPRM),Standards of Performance for New Residential Wood Heaters, New Residential Hydronic Heaters and Forced-Air Furnaces, published at 83 Fed. Reg. 61,585 (Nov. 30, 2018).
AGH is a national, non-partisan, non-profit association that promotes advances in wood stove technology to ensure that wood and pellet stoves become steadily cleaner and more efficient. AGH has held four Stove Design Challenges to highlight the potential of innovative design in wood and pellet stoves and to educate policymakers and consumers.
AGH opposes any proposal to provide “sell-through” periods or to extend other compliance deadlines when there are sufficient products available that comply with EPA’s applicable standards. Achievable emission regulations, such as EPA’s NSPS for New Residential Wood Heaters, New Residential Hydronic Heaters and Forced-Air Furnaces, are based on levels that manufacturers can meet through the use of technology that has been adequately demonstrated for the source category. These standards, that recognize such demonstrated technologies, are vital to driving the innovation process that encourages more manufacturers to develop and manufacture cleaner and more efficient stoves.
1. There is no technical or legal justification to change the timeline for Step 2 compliance
EPA fails to provide any compelling technical or legal basis to justify aproposed sell-through for wood stoves. The assertion that some manufacturers and retailers would financially benefit from a delay or sell-through is not consistent with the mandates of section 111.
Section 111(a)(1) of the Clean Air Act defines “standard of performance” as “a standard for emissions of air pollutants which reflects the degree of emission limitation achievable through the application of the best system of emission reduction . . . .” 42 U.S.C. § 7411(a)(1) (2013) (emphasis added). The proposal in the ANPRM to revise the applicable deadlines does not explain why such an approach would be consistent with the requirements in section 111. Moreover, when developing the NSPS in 2015, EPA already took into account the cost of achieving the applicable standards as well as the available technology, which is why the Agency provided 5 years for the implementation of the Step 2 standards. The ANPRM fails to state how a sell-though is consistent with the requirements in section 111 and presents no other legal justification.
2. The 5-year timeline in the 2015 NSPS was sufficient
The 5-year timeline provided in the 2015 NSPS was sufficient for achieving the environmental and innovation goals of the NSPS while providing flexibility to industry. AGH supports the timelines outlined in the 2015 NSPS that allows industry flexibility during the period between 2015 and the 5 years following. Indeed, at the time these deadlines were promulgated, industry and EPA agreed that these time frames were sufficient for industry to transition to cleaner stoves. Unfortunately, given the information in the record for this ANPRM, it appears that industry has been spending more resources on obtaining time extensions from Congress, the Executive Branch, and the courts than devoting such financial support to research and development (R&D) and testing.
3. A sell-through is not justified to protect non-catalytic stoves
Apparent from the docket for this rulemaking, a form letter comments for retailers made it easier for this market segment to comment on the need for a stove sell-through. Much of that letter made the case that the range of choice of non-catalytic stoves for consumers would diminish. The letters noted that, while “traditional catalytic wood heaters on the market today might meet the Step 2 requirements” in the lab, the stoves on the market may not meet the requirements “over a lifetime of real-world, in-home use.” The letter went on the express confidence that “[n]ew technologies will emerge as the result of regulation with technology that will surpass Step 2 emission limits while maintaining the ease of operation that consumers demand through the lifecycle of the stove.”
This assertion in the form comment letter has simply not played out in the market. AGH notes that 27 models of non-catalytic stoves had achieved 2020 compliance as of October 2018, and that number will likely rise when the EPA next updates the list of certified wood stoves. While the ratio of catalytic to non-catalytic models of stoves will rise, AGH believes it is premature to artificially protect the market for non-catalytic stoves by extending a sell-through to all classes of stoves, including pellet stoves.
AGH also highlights the rise of “hybrid stoves,” stoves that use both catalytic and non-catalytic technology to reduce particulates. These stoves offer more options to homeowners to reduce particulates, options neither catalytic nor non-catalytic stoves can fully provide on their own.
4. Insufficient cost data on Step 2 stoves
While we are likely to see a small rise in the price of many stoves as a result of Step 2 compliance, there is a noticeable lack of data supporting such a conclusion. The consolidation of models may help manufacturers sell more of each model, which is likely to help keep impacts on the price of stoves to a minimum. Some stove prices may decrease or remain the same, as we saw when some uncertified stoves were required to become certified in 2015. Prices of stoves are likely to be equally, if not more greatly, impacted in a positive way by improved automation processes, and in a negative way by tariffs and prices of steel.
5. Insufficient data on the assertion that consumers will hold off buying new stoves
There is very little data about the proportion of consumers buying a wood or pellet stove for the first time, as compared to those who are replacing an older stove. And often families switch from wood to pellet stoves, or vice versa. First time stove buyers and those who will buy a stove anyway, may be far more numerous than those who would have bought a new stove if it were $100 cheaper. Trends show that extremely affordable stoves are still available at big box stores, including some Step 2 models. What may be more likely to occur is that more consumers will buy the more affordable stoves from big box stores instead of specialty hearth stores. There also are a growing number of certified stoves on the second-hand marketplace; these stoves still offer a better alternative than even older, uncertified stoves. We hope that this comment process results in more data about the assertion that a sizable population of consumers will hold on to older stoves.
6. 2018 was a great year for stove sales
Industry argues that manufacturers do not have the resources to undertake the certification process for Step 2 stoves, and that retailers cannot financially weather the transition. Wood stove and especially pellet stove sales are significantly influenced by cold winters, the state of the economy and other factors which can be more significant than this NSPS. However, we note that industry – both manufacturers, retailers and chimney sweeps -- have just experienced a very successful year. A successful 2018 is helping to propel industry in the final leg leading up to 2020.
Hearth & Home magazine routinely interviews retailers about the state of their businesses. Only one retailer in the February 2019 issue mentioned maintaining an inventory of Step 1 products, and the retailer did not express concern regarding the business climate. The majority of retailers sell hearth, patio and barbecue products, and often the retailers express viewpoints regarding all three sectors. These magazine interviews also show that retailers have increasingly diversified products. We reproduced all the specific comments about stoves in the February 2019 issue of Hearth & Home. Reproduced below are retailer comments from pages 68 – 70 of the magazine. To protect the identity of the retailer, the magazine only quotes identify the state in which the retailer resides rather than the name of the retailer.
Arkansas: “2018 turned out to be a good year overall.”
California: “We have been in business for 33 years and this was the best year yet.”
California: “Hearth department was up 8%.”
Connecticut: “This was one of our top Decembers since we’ve been in business; 2019 looks to be a great year, even though we had a very good 2018.”
Illinois: “Woodburning is slowly fading away, even in a rural wooded area like ours.”
Louisiana: “Our service business is up 67%.”
Nebraska: “Hearth sales were stagnant from 2017. All in all, business was good, but we’re interested in seeing where the trade war steel prices go, along with tariff surcharges.”
New Jersey: “Another year has flown by. Solid growth once again.”
Oregon: “We opened a new hearth showroom in fall of 2018.”
Pennsylvania: “Best calendar year in the last five years. Also, very profitable.”
Virginia: “Wow, what a year! I’ve worked here for 27 years and have never seen it this busy. Thanks President Trump. Business is a boomin’. Can’t wait for this coming season. Woo-hoo. $$$.”
Virginia: “2018 ended with record sales and installations of vent-free gas fireplaces, log sets and inserts.”
Wisconsin: “No slowing down in sales of high-end fireplaces, wood and gas. Wow, what a time in our industry.”
Wisconsin: “Overall year-end we were way up. Wood seems to be really strong.”
Wisconsin: “Busy year. Easily could have had greater sales if we could find another good employee. We have had some warranty issues and manufacturers did not stand behind their product.”
Wisconsin: “Wood and gas fireplaces are strong. Plain steel wood stoves is a weak spot. We’re clearing inventory of all non-2020 compliant wood stoves. Will restock only 2020 compliant.”
7. The number of stove models will temporarily shrink
While the number of different stove models will temporarily shrink due to the increased stringency of the standards, not all consumers will notice because there will continue to be a variety of products on the market. Many manufactures are getting around any perceived limitation of products by certifying one firebox, then offering it in a variety of models – such as with a pedestal, with legs, or even as an insert. More manufacturers are beginning to offer a variety of stove models, so the standards’ impact on consumers will decrease even further.
8. There is minimal public support for sell-throughs
In 2014, EPA received 1,750 Comments in response to proposals that set 2020 as the deadline for Step 2 compliance. Just 5 years later, the process led by the current administration’s EPA generated only 75 comments for the sell-through for furnaces and boilers, including comments from less than 10 individual citizens. In addition, there is no state, county or city that supports providing a sell-through for what constitutes the dirtiest appliance class among wood heaters. Clearly, the populations that are most greatly impacted by such a sell-through, recognize that this deregulatory action increases pollution far more than the financial benefit for manufacturers.
AGH appreciates the opportunity to submit these comments. If there are any questions regarding any statements above, please contact John Ackerly at 301-204-9562.