Sunday, May 31, 2020

EPA proposal to relax wood stove rules sows division between states and industry – and between industry factions

Some states may disallow sell-through, but selling-through has already begun

Rep. Peterson (D-MN) seen here with
constituent Dennis Brazier of Central
Boiler, was the strongest advocate for
a sell-through in Congress.
The EPA proposal to relax the Obama-era timeline for wood heater emission compliance is setting up another showdown between the stove and boiler industry and states and air quality agencies.  At issue are sales of more polluting wood stoves and wood boilers.  The far cleaner pellet stoves and pellet boilers, favored by some states as an important renewable alternative to fossil fuel heat, are not as contested.

While many European countries are moving forward with incentives for pellet stoves and boilers as part of a broader policy to reduce fossil fuels, the US wood heating community is embroiled in fights about whether the dirtiest cordwood appliances should get a new lease on life.  The main wood heat industry association, the Hearth, Patio and Barbecue Association (HBPA) also represents gas appliances, so it is not making the case that these wood and pellet heaters are a low-carbon, renewable technology.

The stakes are not as high as they were in 2017 when Congress nearly passed a 3-year extension to stove and boiler emission deadlines, or in 2018 when the EPA proposed a full two-year sell-through.  But the way this sell-through proposal finally emerged is opening old wounds, not only between industry and states, but also within industry.  It led to the two highest volume stove manufacturers leaving HPBA and left the association without a meaningful victory during Trump’s presidency.

The EPA has opened the public comment period on whether to allow a window in the fall to sell now out-of-production higher emitting Step 1 stoves that were scheduled to be illegal to sell after May 15. The EPA will also host a virtual public hearing on June 8 to solicit input.  Most experts believe some fall sell-through period is extremely likely but its length and potentially some smaller details still hang in the balance.  In the meantime, hundreds or possibly thousands of non-compliant new wood stoves and boilers continue to be openly advertised and sold across America two weeks after the stricter EPA standards took effect.

While many retailers and manufacturers took the May 15 deadlines seriously, some continue to advertise and/or sell Step 1 heaters on their websites, showroom floors, or through Craigslist, eBay and other sites.  EPA has made enforcement a low priority which does not preclude letters and visits by EPA enfrcement. HPBA has also been consistently educating retailers about how to comply with the new regulations.  In addition, HPBA has been reminding both manufacturers and retailers that even though the EPA may not very active at higher level enforcement, state and local authorities can still be active.
HPBA has continually
updated its education
effort for retailers.

Industry highlights mom and pop hearth stores in their advocacy efforts to get a sell-through, but the needs and goals of manufacturers is the crux of the problem.  Mom and pop stores still have Step 1 stoves as a result of the many different relationships that they have with manufacturers, some of whom pressured them to keep buying Step 1 stoves, some of whom didn’t even have Step 2 stoves until recently – and some who were ahead of the curve and started selling Step 2 stoves in 2018.  

Some manufacturers still really need the sell-through because they have unsold inventory of Step 1 stoves, boilers, and furnaces and may have to buy back many thousands of Step 1 appliances.  Five years lead time could have been enough, but there was a widespread belief that the 2020 deadline would not stick under a Trump administration.  As late as the winter of 2020, some manufacturers were still in disbelief that their industry association didn’t get any significant results in the courts, Congress, or with the administration.  

Conversely, the good news for the progressive pellet and wood heating community is that the Obama-era regulations are still intact, 5 years after they came into force.  Pellet stoves and boilers are
2020 compliant pellet stoves show a
strong correlation between lower 
PM, lower CO and higher efficiency.
significantly cleaner and more efficient not just in test labs, but in the homes of more than a million families, many of whom want them not just to save money, but to stop paying a heating bill to multinational oil companies.

The stakes are not as high for some New England states like Vermont that have been giving hefty incentives to mostly European designed, clean burning pellet boilers and don’t experience severe weather inversions that trap wintertime pollution close to the ground. (Vermont and other other New England states do experience regular, more localized inversions in valley.)  But a potential sell-through of dirtier cordwood appliances represents a greater threat for West Coast communities struggling with excessive wood smoke from California’s central valley to the Canadian border.

Nowhere is the sell-through more controversial than in the warm air furnace sector, where two small companies with Step 2 compliant units would be significantly harmed by an initiative enabling a larger manufacturer to sell their older, higher polluting units.  

The stakes may the highest for upper mid-west states like Minnesota where outdoor wood boilers are
On per capita basis, wood smoke
concentrations are highest in states
with more outdoor wood boiler
installations like Wiconsin and
Michigan.
as popular as they are controversial, having subjected hundreds of towns and neighborhoods to excessive smoke.  A sell-through could result in hundreds of additional Step 1 boiler installations that will continue to emit heightened levels of smoke for a decade or more.  Warm air furnaces are also higher sellers in Mid-Western states, as they experience some of the coldest weather in the country. 

Minnesota is home to Lamppa Manufacturing, a small Step 2 warm air furnace manufacturer that is vehemently against any sell-through, as their company would suffer if Step 1 furnaces were allowed to come back on the market.  Lammpa Manufacturing is not a HPBA member because it and other manufacturers like Woodstock Soapstone oppose HPBA’s history of advocating for more lax standards for outdoor wood boilers and stoves.

EPA adds to confusion

On May 20, EPA Administrator Wheeler defended the proposed sell-through at a Senate hearing, adding to the confusion and myths about wood heaters.  The Administrator mistakenly said that the EPA is only proposing to allow stoves to be sold that we allowed by the 2015 standards and  “we’re not talking about standards that are 20 or 30 years old.”  But 90% of stoves met the 4.5 gr/hr. standard when Washington State adopted that standard in 1995.  The EPA adoption of it in 2015 barely moved the needle at all and allowed stoves tested as far back as 1990 to remain on the market.

The Administrator also incorrectly told the Senate Committee that most retailers sell off their
Administrator Wheeler's performance
at a recent Senate Hearing showed limited
understanding of sell-through details.
inventory in the spring.  In actuality, the spring is the slowest sales period of the year and the Coronavirus shutdown disrupted sales (though far less than industry claims). Administrator Wheeler further added to the confusion by implying that it was the manufactures who were most imperiled because they had to buy back unsold stoves from retailers.  

Meanwhile, the EPA’s Office of Enforcement, OECA, has not designating Step 1 heaters as “Out of Production” but says that they are in the process of changing their database.   The Alliance for Green Heat (AGH) believes that all out-of-production stoves should be consistently designated, and the EPA should not be operating under the assumption that there will be a sell-through until one is formally approved.  

The EPA database of certified stoves is also riddled with errors and omissions but it remains a vital resource for states, air agencies manufacturers, retailers, consumers.  Many of the errors are minor and its important to note that the EPA maintains this database as a public service, not because it is legally required to do so. If the certification of a unit, or other details are in doubt, the most authoritative document is the certication test report that manufacturers are required to post on their websites.  Moreoever, scores of stoves may be fully certified but not appear on the EPA's database.  It may take up to 40 days for the EPA to post an appliance on their database after it is certified because manufacturers are required to email the EPA showing the link where they have posted their test dart on their website before the EPA adds them to the database.  This helps ensure that manufacturers comply with the requirement to vbe transparent about their testing, which manufacturers used to keep confidential prior to 2015.   

Dispute over $75 million change-out fund and one-year sell-through offer

During the May 20th Senate hearing, both Administrator Wheeler and Senator Capito (R-WV) took
Senator Carper (D-DE) has become the
leading voice in the Senate for stricter
wood heater emission standards.
aim at Senator Carper (D-DE), noting that he had previously supported a sell-through but now opposed it.  The day before the hearing, Jack Goldman of HPBA sent a letter highlighting this supposed contradiction, and the main reporter following this issue, Sean Reilly, called it a “flip-flop” by Senator Carper.   But the attempt to embarrass Carper may have backfired as it brought back a controversial chapter in this saga into the limelight.

Senator Carper introduced a bill in 2018 that would have established a $75 federal change out fund and provided a one-year sell-through.  Although the bill was historic opportunity to get both a sell-through and a significant fund to subsidize the sale of wood stoves and boilers.  HPBA refused to support it at the time because it would have also codified Step 2 emissions limits as of May 2020, and the association still thought they could roll back much of the 2015 New Source Performance Standards (NSPS), or at least delay by three years.  Only in retrospect can the wood heater industry appreciate what an opportunity Carper’s amendment was, and how little industry ended up securing in subsequent years.  HPBA’s decision to try for a three-year extension instead of a one-year sell-through and a $75 million change-out fund may have exposed differences between central heater manufacturers who really needed a three-year delay, stove manufacturers who were already meeting Step 2 emission standards, and retailers who would have been a main beneficiary of a large change-out fund.

This moment may have represented industry’s high point in influence in Washington but the moment was squandered and such an opportunity has never come back.

AGH asked HPBA how decisions about wood heater policy are made within the organization. Jack Goldman, CEO of HPBA responded in writing that, “All policies of HPBA go through the appropriate internal approval process that includes staff, committees, sections, and leadership.”  HPBA members interviewed for this story say that policy is normally set by the Solid Fuel Hearth Appliance Section and that central heater companies do not have any inordinate influence but HPBA must represent all its members, even if that means working for “the lowest common denominator.”  One HPBA member who was distressed by HPBA’s lack of support for Carper’s amendment said they did not recall any vote on that policy decision, and that there was a lot of inconsistency on what matters were voted on, and what was decided by HPBA government affairs staff.

In hindsight, industry would have benefited far more from Senator Carper’s amendment. At the time, however, industry felt that, between Congress, the courts and the Administration, they still had lots of cards to play, according to industry members interviewed for this blog.  Industry had the opportunity to promptly litigate the legality of the 2015 NSPS but instead chose to delay litigation and take their grievances to Congress and the Administration.  Briefs for the court challenge are due in August but it is unclear if there is anything meaningful left to litigate other than some technical issues that don’t implicate timelines and emission standards.  It’s also unclear how much appetite manufacturers have for litigation if it needs to be funded with assessments in addition to normal membership dues.

States and programs that may not allow the sell-through

A number of states, such as Minnesota, may have incorporated the 2015 NSPS and its 2020 timetable into their state laws even before they anticipated a sell-through and thus cannot allow a sell through per state law.  New York has publicly said that a sell-through may violate state laws, leaving open the question whether retailers can safely sell Step 1 appliances in the Empire state.  Most change out programs and incentive programs that account for potentially up to 15% of annual stove sales only make Step 2 units eligible.  Some of those programs operate with funds tied to the EPA that could not be redirected toward Step 1 stoves.  

In addition, it’s unclear if the sell-through will be allowed in parts of Canada that have expressly adopted the 2015 NSPS.  The provinces of Quebec and British Columbia, home to a third of Canada’s modest 37 million population (less than California’s) adopted the 2015 NSPS.  It’s also unclear if local jurisdictions, including major urban areas, could disallow a sell-through.  Depending on the number of states that reference the 2015 NSPS deadlines, there may emerge a patchwork of regulations disallowing the sell-through.  This kind of patchwork is often what all industries try to avoid, as it makes commerce more difficult.

Central heater manufacturers spearhead the fight for relief

Central wood heater companies appear to have played an outsized role in the effort to delay the EPA’s wood heater deadlines, frustrating HPBA members who would rather have leaders of companies with more modern technology be the face of industry.  Frank Moore, President of Hardy Manufacturing, a Mississippi based outdoor wood boiler company, represented the wood heater industry at a Senate hearing in 2017.  However, Hardy Manufacturing had no intention of making a Step 2 heater and has since gone out of business.

As recently as February of 2020, HPBA said they “invited two HPBA members – Central Boiler and U.S. Stove Company” to a private meeting with officials at the Office of Information and Regulatory Affairs (OIRA), which is part of OMB.  These two companies dominate the outdoor boiler and warm air furnace markets.  It is unclear why HPBA invited them to the meeting.  AGH asked HPBA why they invited those two companies to this meeting, and in a written response, Jack Goldman said, “we do not discuss internal deliberations as to how we make such decisions.”

   
The appearance that HPBA policy was being driven more by the needs of companies making central boilers caused considerable friction within industry.  One HPBA member, who asked that his name not be used, said that some companies did not renew their membership in HPBA in 2020 because the “NSPS assessment fees are not in the interest of the company,” referring to the fees manufacturers paid to fight the EPA’s 2015 NSPS.  The initial success of HBPA’s advocacy efforts, which led to a proposed 2-year sell-through for central heaters but not for stoves, was a deep disappointment for some HPBA members that only made stoves.

The February meeting left a paper trail on the record, giving insight into the number of Step 1 central heaters these larger manufacturers have in their own warehouses. John Vorhees, Director of Compliance for US Stove Co., said in a memo to the EPA that, “We, as a manufacturer are also stuck with inventory. We currently have $730,000 of WAF and $670,00 of AAA products.” (WAF stands for warm air furnaces, regulated under Subpart QQQQ of the NSPS, and AAA refers to stoves, which are regulated under Subpart AAA of the NSPS.)
"Thank you Congressman Peterson" says a
sign held by Central Boilers employees in
2017, after Peterson  introduced HR 453

Central Boiler did not disclose in their memo that they had any Step 1 boilers in their possession but said that 210 of their dealers had 596 Step 1 boilers, or an average of 2.8 boilers apiece.  Oddly, the memo does nothing to explain how many Step 2 boilers those dealers have, or when the company stopped selling Step 1 boilers to their dealers and started helping them stock up on Step 2 boilers.  As a result, this memo, like scores of other comments submitted to the EPA in support of a sell-through, fails to provide the EPA with the kind of data that demonstrates a sell-through was warranted and that manufacturers acted timely and in good faith to provide Step 2 heaters to retailers.

The 2018 EPA proposal for a 2-year sell-through for boilers and furnaces, but not for stoves, would have extended the sales of the most polluting units the wood heater industry had to offer.  The irony was not lost on many in the stove industry, who privately complained that it was the outdoor boilers who brought on stricter scrutiny from state and federal air quality agencies in the first place.  Now, they were being teed up to get relief. But the plan stalled, and the EPA public comment process resulted in a denial of the sell-through for central heaters, which they unofficially announced in November 2019.  

After industry failed to secure a two-year sell-through that would have allowed them to build up a two-year inventory of Step 1 heaters, US Stove Company laid off 25% of their workforce and also dropped their membership in the HPBA.  England Stove Works also dropped their membership but reportedly did not have any such large-scale layoffs. These two companies are by far the largest volume stove manufacturers in the US, as they sell to big and small hardware chain stores and have buy-back agreements.  
Hardware chains such as Home Depot,
Lowes, Menars, Habor Freight Tools,
Northern Tools and  True Value, sell
the majority of stoves in some areas.

There has long been tension between US Stove Co, England Stove Works and the makers of more expensive stoves that get sold through specialty stove retailers.  US Stove Co and England Stove Works have always offered EPA certified stoves for under $1,000 and rarely sell stoves that cost more than $2,000.  After the 2008-09 recession, these companies picked up a larger slice of the stove market, putting more pressure on specialty hearth stores whose stoves often start at $2,500 and can go up to nearly $5,000.  Brandon Barry of US Stove Company told AGH that "we have tried in all instances to maintain similar price points in the marketplace, even with increased cost on our 2020 models, leaving those stoves as some of the most cost effective for consumers in the market."

Similarly, when the cleanest and most efficient wood pellet boilers are being sold for $10,000 - $20,000, US Stove arguing for a 2-year sell-through told the EPA that, “We have determined and experienced if a forced-air furnace is priced at retail beyond $1,500, the consumer looks for alternative models or appliances with different heating sources (i.e. electric, gas, geothermal, and etc) for their central heating requirements. It is important to note we are the largest producer of wood burning forced-air furnaces in the industry.”  In addition, Brandon Barry of US Stove told AGH that "record low fuel prices were and still are a driving factor of not introducing a furnace for this year."

The EPA’s low priority enforcement policy

The EPA has adopted a more low priority enforcement approach across a broad range of regulated industries.  With wood heaters it has appeared to be somewhat low-priority for many years, far before the Covid-19 pandemic.  The EPA is not expected to engage retailers who continue selling Step 1 appliances, but HPBA has still doggedly implored them to abide by the legal timeline and avoid any possibility of infractions. 
Acme and EZ Boiler do not advertise
their units as commercial only

The EPA’s lack of enforcement may be most pronounced by the continued open sale of uncertified outdoor boilers and furnaces.  Several outdoor boiler and warm air furnace companies still brazenly ignore EPA laws and operate with apparent impunity.  Companies like Acme Furnace Co based in Missouri, EZ Boiler based in Michigan and Hyprothermboiler based in Arkansas continue to make uncertified residential wood boilers and furnaces.  We are not aware of any EPA enforcement activity despite being contacted numerous times in recent years.   

Follow the money

HPBA is a small industry association by Washington standards with about a $6 million-dollar budget.  HPBA emerged from the Wood Heating Association founded in the 1970s during the wood stove boom years.  It later merged with the barbecue industry association, but barbecue manufacturers only pay a fraction of the dues that hearth industry manufacturers pay.  Three quarters of HPBA’s revenue comes from its annual Expo and only 22% from membership dues.  The loss of membership dues from US Stove Co. and England Stove Works may be less significant than the loss of revenue from them buying booth space at the annual Expo, but since they don’t sell to independent hearth retailers, their motivation to have a booth at the Expo is not as important as other stove manufactures that rely on small retailers.

Retailers are members of regional HPBA affiliates and do not pay dues to the national HPBA, even though affiliates share a small amount of retailers membership dues with the national HPBA.  Test labs also pay dues to regional affiliates based on their income, ranging from a high of $1,050 for Omni Test Labs to $350 for Intertek, each year.  (AGH is also a member and pays a non-profit rate of $350 per year.)  Between membership dues and fees for manufacturers and renting booth spaces at the Expo, HPBA remains mostly a manufacturer-driven industry association.

The Solid Fuel Section of HPBA is the committee that “promotes and protects the interests of HPBA members that produce wood and pellet hearth appliances,” according to the HPBA website.  The Section also funds specific legislative, regulatory, and consumer initiatives.  If the Section votes to litigate or pursue Congressional legislation, the effort is funded through a special assessment based on the size of each company in the Section, not by barbecue or gas section members.  Some companies resisted expensive efforts to undermine or stall the NSPS, but still had to pay the special assessment, and others refused to pay any more special assessments after the EPA’s only proposed a sell-through for central heaters in 2018.  The 2019 assessment for additional NSPS advocacy approved by the Solid Fuel Section was reportedly less than $100,000, but previous years may have been much higher.

The March 2020 Expo in New Orleans was nearly cancelled but carried on with smaller attendance.  This was the first Expo to showcase all 2020 compliant appliances and was notable that the only two stoves considered for Vesta awards were both automated.
The annual HPBA Expo is a networking
hub not just for industry, but also EPA and
air quality experts who attend parallel
events.

The main purpose of the annual Expo is to provide a forum for manufacturers to sell to retailers and that in turns provides HPBA with much of its annual operating expenses.  HPBA largest expense by far is putting on the Expo.  Its next largest expense is its advocacy and government affairs department, which reportedly spends nearly $1 million a year, mainly in salaries.  In addition, regional affiliates, with far smaller budgets, engage in local lobbying and advocacy.  By far the biggest issue in recent years for the Government Affairs staff has been trying to extend the 2015 NSPS deadlines and dismantle parts of it.  But increasingly HPBA and its regional affiliates are engaged in fighting against restrictions on natural gas and the electrification of heating.

It’s unclear what percentage of membership dues, assessments and booth fees companies like Central Boiler and US Stove Co pay to HPBA.  Hearth & Home Technologies, by far the largest higher end stove manufacturer in the US who owns top brands like Harman, Quadrafire and Vermont Castings, already pulled out of HPBA’s annual Expo several years ago, which was an even bigger financial blow to HPBA.   It’s unclear if the departure of US Stove Co will help other factions regain more clout and leadership within HPBA.

Companies making and supporting some of the cleanest, most efficient, and most automated wood heating technologies have formed a smaller trade association, Biomass Thermal Energy Council (BTEC), that initially broke off from the Pellet Fuel Institute (PFI) so it could more aggressively fight for modern pellet heating policies in Washington DC.  (AGH is also a member of BTEC and its President John Ackerly is on the Board of BTEC.)

Impact of sell-through sales of Step 1 appliances

The proposed sell-through would clearly benefit some companies and reduce the sales of others.  Manufacturers that took the deadline seriously would have to compete with those who were counting on an extended timeline and can now offer cheaper or more discounted products.  Some retailers who cleared out their Step 1 products also would be unhappy with the sell-through for this reason, but the majority who have some Step 1 stoves left support it.  Retailers that have no Step 1 stoves could also buy more from manufacturers who have left-over Stove 1 inventory.

For the states and air agencies opposing the sell-through, the issue has little
A smoke capturing inversion in
Fairbanks, Alaska.
to do with issues within the trade association, and everything to do with the additional pollution that will result from the sell-through.  Upper Midwestern states where central heaters are popular and Western states that have frequent inversions are struggling to determine how many more Step 1 boilers, furnaces and stoves are left to sell.  One data point causing great concern is that a relatively small number of manufactures who sell to “major home center chains, and report that over $10 million worth of product will not sell in time and must be repurchased,” according to a letter from HPBA’s Jack Goldman to EPA Administrator Andrew Wheeler.  It is not clear how much was repurchased, or still needs to be repurchased, what percent is furnaces and boilers, and how much of that could back on the market before Nov. 30.  Brandon Barry of US Stove told AGH in a written response to questions that “our inventory levels are confidential. I will say that sell through would be beneficial for us at both the manufacturing and retail level. ... 
 Some product came back to our location and could be sold if sell through comes to fruition. Some has already been destroyed."  Pellet Stove Parts 4 Less, a Massachusetts company said they bought more than 100 Englander Step 1 pellet stoves in April at bargain prices so they could take them apart and sell the individual parts.

The other controversial area is how much more polluting Step 1 appliances are in the field, compared to Step 2 appliances.  HPBA’s position is that Step 1 appliances are “perfectly good” and a sell-through “ultimately has a minimal impact on the environment as the products in this sell-through provision are already clean burning.”  In written answers to questions submitted by AGH, Jack Goldman added, “We certainly hope that the Step 2 appliances may be better than Step 1 products in people’s homes … EPA simply has no data confirming that there is a distinction in the field between a 2.0 g/h laboratory number and a 4.5 g/h laboratory number.” 
Emission standards for lab testing dropped by more than a
 half for stoves and even more for most boilers and furnaces.

While pellet stoves are the least concerning, as many Step 1 pellet stoves were already under 2 grams an hour, outdoor and indoor boilers, also known as hydronic heaters, have the widest differences between Step 1 and Step 2 and are likely the appliance type where there is a very appreciable emission difference.  Furnaces are even more complex as they didn’t even have a voluntary emission program prior to 2015, so they have had to go from an uncertified class of appliances very quickly.  In 2015, their Step 1 standards were ≤ 0.93 lb. of PM/mmBtu heat output but their Step 2 dropped the most drastically, all the way to ≤ 0.15lb/mmBtu heat output.  It’s hard for any wood heating combustion expert to expect that such a drastic drop in required lab certification limits would not impact emissions in the real world. 

For states and air quality agencies, there is also a much more antagonistic relationship with HPBA than there was decades ago, before this bitter fight over the 2015 NSPS.  The apparent leadership of central boiler companies within HPBA has not helped the relationship, and it will likely lead to more robust comments opposing the sell-through and a potential increase in state enforcement activity.

What comes next

US Stove Co and Englander dropped their memberships for different reasons, but the loss of their membership dues and assessments is overshadowed by a far more imminent threat to HPBA’s financial health: whether they can have the next expo in Nashville in March 2021.  The association is actively exploring whether to hold a virtual trade show but that may not provide the revenue, even after the far lower expenses, that it relies on.  Many trade associations and other groups are facing similar, longer term disruptions to the business models as a result of the Cover-19 pandemic.
NESCAUM's Lisa Rector  demonstrating
the IDC test method to EPA staff at the
2018 Wood Stove Design Challenge on
the National Mall.

Then, there is the next NSPS which could begin as soon as 2023.  Many people in industry worry that the 2 grams of PM2.5 per hour standard is just a precursor to 1 gram an hour.  But the next NSPS is likely to be far more complex and will focus on adopting an entirely new test method that may abandon measuring pollution in grams per hour, and adopt grams per unit of heat, which is the way boilers are already measured.  HPBA members have already paused development of the broadly accepted ASTM E3053 cordwood test method, that was mainly designed by the HPBA manufacturing community.  HPBA members developed the underlying data for this ASTM cordwood test, and it has become very popular, with 57 out of the 120 Step 2 wood stove models using the ASTM test.
Now the Northeast States for Coordinated Air Use Management (NESCAUM) is developing the underlying data for a series of Integrated Duty Cycle (IDC) tests, mostly with funding from the New York State Energy and Research Development Authority (NYSERDA).  The EPA informed HPBA in January that they plan to use the IDC framework as the basis of the future Federeal Reference Method (FRM), the officially designated certification test method.

The question will likely be about how much data NESCAUM releases and when, and whether HPBA feels that it has been sufficiently included in the process and ultimately whether the EPA has enough data to adopt a FRM.  The amount and quality of test data developed for the ASTM will be a reference point.  Developing test data for a test method is a lengthy and expensive process and also can become political and controversial based on who can witness testing, how much data is shared, how long it takes to share data, what new instrumentation is required, and what the next set of timelines looks like.   The process could lead to another lawsuit – and special assessments from the HPBA’s Solid Fuel Section, if manufacturers feel their ability to certify products is too unpredictable.  Alternatively, if the acrimony around this proposed sell-through diminishes, a more cooperative and inclusive process could emerge and result in a genuinely improved test method that will encourage innovation to make stoves burn well in homes, not just in labs.

Friday, May 15, 2020

May 15, 2020: a historic day for wood heat technology

The end of an era for some iconic stove models and the beginning for others
Quadrafire's Mt. Vernon AE is
one of many popular, iconic stove
lines going out of production 

Ten years in the making, modern wood heater emission standards are finally here, today on May 15. Hailed by many and derided by many, May 15 brings to a close a major chapter  in the book of wood heater regulation- though not the last chapter by any means. The EPA, industry and states continue to work on cordwood test methods, parts of the Hearth, Barbecue & Patio Association (HPBA) lawsuit are still outstanding, and public comment will soon be open about a likely proposal for a fall sell-through of Step 1 stoves.

To draw an analogy from biology, today marks a mass extinction of heater models unparalleled since the 1988 – 1990 period when even more heater models died off because they could not meet basic emission standards. The largest genus of stoves to die off back then was the Fisher family of stoves, though they live on in tens if not hundreds of thousands of American homes.  A few that go extinct today are also akin to famous dinosaurs, like the Ashley circulator line of stoves, that appear to lack a 2020 compliant version for wood.  Granted, some of the most iconic stove models quietly slipped out of production years ago, like the Acclaim, Intrepid and Vigilant, which have sold more units than most current models ever will, between their catalytic and non-catalytic versions.

For pellet stoves, May 15 marks the end of the Whitfield era.  Whitfield pellet stoves are still renowned for their simplicity and durability and they lived on via the Montage model made by Lenox and then by IHP.  As of May 16, Jerry Whitfield’s legacy is alive and well in the history books but gone from showroom floors.  The Mt. Vernon AE, another classic and popular pellet stove made by Quadrafire is also gone the way of the dinosaur, (the company continues to build the slightly similar Mt. Vernon E2).
The classic Jotul F 602 endures
with a 2020 compliant version

Then there are stoves like the classic Jotul F 602 that was popular when it was introduced in the 1930s. It’s virtually identical looking modern version is 2020 compliant, and still popular. 

The millions of dedicated, experienced wood stove enthusiasts in the US may be a nostalgic lot, who fondly remember the old models and the days when emissions limits were not as strict.  But May 15, 2020 is also a milestone in stoves becoming cleaner and more efficient, a point that often seems to get lost in the acrimony about the how the EPA is managing the process.  

It’s tempting to say that the 2015 wood stove rules, that culminated today in a 2 to 2.5 gram an hour standard, will give the stove industry a new lease on life, like the 1988 EPA regulations did.  The jury is still out on how much better these stoves are than the ones allowed to emit up to 4.5 grams an hour and some models were likely brought to market too quick, before they were sufficiently field tested.  Instead of touting the new prowess of these cleaners stoves, almost all industry leaders have  been saying there is no appreciable difference between a 2-gram standard and a 4.5 standard.  Part of this is a messaging tactic to oppose stricter standards or possibly they know more about how test labs can produce ever lower emissions data from virtually the same stove.   

The sell-through that kept falling through

The May 15 deadline was a sour one for many retailers and industry members who thought that there would be a sell through.  First, the EPA raised their hopes by proposing a sell-through in 2018, only to reverse course and deny it in March 2020.  The March ruling was a blow to industry morale even though the EPA agreed to publicly tell industry in October 2019 that they should stick to the original
Senator Carper (D-DE) has emerged
as a leading voice for stricter stove
regulations in the Senate
timetable.  Then HPBA rallied again in March 2020, apparently thinking they could get a Direct Final Rule, allowing a sell-through starting on May 16, and everyone’s hopes went back up again.  And, Mandy Gunasekara was back at the EPA, after more than a year absence. But Direct Final Rules are for non-controversial changes that won’t be opposed by any stakeholder.  Senator Carper from Delaware quickly made sure that they EPA knew how contentious a sell-through was.  

It wasn’t until early May that it became clear to HPBA that getting a Direct Final Rule was like threading a needle in a hurricane, even with some high-ranking friends in the Trump Administration.  Then, HPBA seemed to quickly change course, urging industry to ignore the possible sell-through that they had fought so hard to secure.  HPBA unveiled a promising  Stoves to Homes Initiative that would allow retailers to give away their unsold Step 1 stoves to a charity who would then install them in low-income homes.   [Update: At 5:00 PM on May 15, the EPA released the details of a proposed sell-through window in the fall, ending on Nov. 30, and after public comment and an online hearing.]

HPBA worked hard on behalf of its membership on all three branches of government: Congress, the courts and the Administration.  HPBA came extremely close to victory in Congress, passing a far-reaching three year delay Bill in the House, championed by Rep. Collin Peterson (D-MN) who represents Central Boiler's district.  This was far more than a retailer sell-through and industry could not secure support from key democrats in the Senate when the initiative failed.  Many assumed industry could secure relief from the Trump Administration, as so many other industries have, and the 2018 EPA sell-through proposal was the fruit of those efforts.  Some speculate that the 2018 departure of EPA official Mandy Gunasekara left HPBA without a high-ranking benefactor to shepherd through the sell-through proposal.  It may have been left to lower
As manufacturers tried to
assure their retailers they were or
would be ready for 2020 back in
2017 and 2018 with ads like this,
the EPA saw an industry that did
not need a sell-through
level EPA staff who sided with states and air agencies that the case for a sell-through was weak.  What the EPA may have failed to grasp, was that even through many stoves were certified to 2020 standards in 2016, 2017 and 2018, many manufacturers did not make those models available to retailers until later in 2019, leaving retailers no option but to continue buying Step 1 models until the very last heating season.  

Finally, in the third branch of government, the courts, HPBA’s legal strategy seemed to unravel as it requested extension after extension and as time passed, more and more stoves were certified to the 2020 standards, including the 2.5 gram an hour cordwood standard. HPBA had a strong claim the EPA lacked sufficient data to set a cordwood standard, but then its members began favoring the looser ASTM cordwood standard.  After 5 years of advocacy, industry had little to show to the retailers, many of whom are now angry.  

Fortunately, 2018 and 2019 were mostly good years for much of the manufacturing and retail industry, according to a number of detailed articles in Hearth and Home Magazine.  The wood and pellet heater industry entered 2020 on decent footing, though many manufacturers and retailers increasingly make profits from their gas and electric lines of appliances, not wood and pellet.  Then the coronavirus hit with a broadside slam that appears to be lingering not just through the spring and summer, but potentially could have a major negative impact in the fall of 2020 and well into 2021.  The pellet stove and boiler sector is also particularly susceptible to low oil prices, which simultaneously accompanied Covid-19 in its swath of destruction through the economy.

In addition, the industry’s right-leaning, anti-regulatory tilt has built friends in Congress and the Administration, but not necessarily with the leaders of the renewable energy movement, who seem to be increasingly looking to electrify residential heat. Privately, many HPBA members say they wish the association had not tried to fight the regulations so hard, even though the outdoor boiler and warm air furnace sectors were pushing them to do just that.  If Senator Biden is elected in November, industry would likely do well to try to quickly reposition themselves and be part of coalitions that could stand to benefit from a pro-renewable administration.  Pellet heating technologies should be best positioned to benefit from some form of green new deal and potentially help end the difficult, cyclical boom-bust nature of pellet heater sales.

Certified stoves on May 16
 
A screen shot of the EPA database on
May 15, showing 610 certified stoves.
The number of stoves on the EPA’s list certified room heaters is about to plummet downward, from 610 to 211 stove models.  Hundreds of models that design firms, engineers, lab technicians, production line workers brought to market, will be things of the past.  They represent millions upon millions of stoves that families gathered around in the evening, that kept them warm during power outages, and helped them save enough money for groceries and other essentials.  My grandparents, my parents and my family used many of those stoves, considered to be the best technology of their era.  One of them, a pellet stove made in 2014 and has worked beautifully since then, heats my home as a I write this.

So we put our faith again into the hands of the engineers and lab techs to come up with even better stoves, that will be even cleaner and more efficient. We won’t see the huge PM reduction and efficiency gains that we experienced in 1988- 1990, but chopping lab numbers in half, from 4.5 to 2 or 2.5 grams is no easy feat and should be embraced by all of us.  We should applaud the engineers who do this for us, and especially those who are working not just to achieve these numbers in a lab but who are trying to ensure stoves are cleaner in our living rooms.  
Both wood stoves up for
awards at the HPBA 2020
Expo were automated, a
sign that the stove industry
is movig forward.

Reducing average stove emissions by a gram or two or three per hour from a stove is a major achievement that will protect the lungs of not just those that buy stoves, but their kids, their parents, their grandparents – and their neighbors.  Granted it will take decades for these cleaner and more efficient stoves to be commonplace in homes across America.  After all, there are still millions of uncertified, pre-1988 stoves in homes.  

But we should not forget that the drop to 4.5 grams an hour actually happened more when Washington State changed their standards in 1995, than it did in 2015 when the EPA adopted that change.  Those two decades of sales of cleaner stoves all across America were a blessing that has had long-term ramifications.  Two decades from now, I hope we will be able to look back and appreciate the engineers who designed these cleaner 2020 appliances and gave a new lease on life to this vital renewable energy technology.

Monday, May 4, 2020

EPA amending wood heater deadline to address pandemic sales slump

EPA official Mandy Gunasekaraa, a
Mississippi native, was receptive to
Hardy Heaters, a Mississippi
outdoor wood boiler company
Updated on May 12 - After weeks of intensive lobbying by the wood heater industry, the EPA has sent an amendment to the OMB that is intended to provide a sell-through for Step 1 stoves, according to sources.

However, if there is a sell-through, it would not happen until the fall, or even 2021 given the delays typical of EPA rule making. Retailers will not be able to sell Step 1 stoves during late spring, summer and early fall at the very least.

Changes to regulations involve a months-long process of notice, public comment, and issuing a final rule.  This change was initially reported to be a “direct final” rule, allowing the Administration to make the change more quickly, if it is non-controversial and there are no objections. In most cases, the agency asks to receive objections within 30 days and anyone can object, which may then require the agency to go through the full process.  States, air agencies and other stakeholders would likely object, as the “sell-through” relief sought by industry was one of the most controversial parts of the process, leading the EPA to deny a sell-through in its final rule on March 11, 2020. (On May 11, Senator Carper (D-DE) the ranking member of the Senate Environment Committee, sent a scathing letter to the EPA, demanding answers about why it is contemplating reversing itself, after finding a sell-thorugh was not warranted in March.)

Notice of the amendment was posted but the content of it is not yet public, so details cannot be confirmed.  Retailers were expecting to be able to sell their remaining stock during the end of March, April, and beginning of May, but the pandemic forced retailers to close their doors to foot traffic and rely on online advertising. Many of them did sell some or all of their remaining higher emitting stoves that would have been barred from sale after May 15. As a result, virtually all retailers who still had Step 1 stoves in stock, lost some sales in the  2 months prior to the week of May 15. There is no doubt that the Covid-19 pandemic is having serious negative impacts on hearth retailers, as they move into their summer season when most focus on grills, patio equipment and gas appliances.  However, big box stores and smaller hardware chain stores have remained open and have been steadily selling off deeply discounted Step 1 stoves.

After intensive lobbying for a sell-through in March, HPBA now appears to be backing off from that goal, after the EPA failed to deliver one starting on May 16, and going through the end of the year, which HPBA had hoped for.

If the EPA were to propose to replace those 2 months with a sell-through to the end of the year, that would be a 7 ½ month sell-through, including during the fall, the busiest buying season of the year. But sources say that the EPA is likely to just try to re-open a 2-month window in the fall, which would mean Step 1 stoves must be pulled off of showroom floors on May 15 but could be put back there until a possible late 2020, or 2021 sell-through window.  Given the legal complexities of changing federal regulations quickly, a fall sell-through may have been the most likely scenario all along, and the industry effort seems to have created some confusion about what was possible in the first place.  HPBA is now urging retailers to either sell Step 1 stoves before Friday May 15, or donate them to one of four designated non-profits who will install them in low-income homes.
Hardware stores did brisk business
selling off Step 1 stoves in March
and April. 

Re-opening a window to sell Step 1 stoves in the fall or winter is clearly tricky for both industry and the EPA. The EPA could issue a “no action assurance” (NAA) letter, stating their intention not to enforce the rule against selling Step 1 stoves after May 15. But NAA letters are typically issued for specific incidents and not as a lengthy, national solution.  OECA, the EPA's Office of Enforcement and Compliance, has reportedly not agreed to issue an NAA letter.

Background
The main drivers within industry appeared to be the outdoor boiler companies, and the unlikely pairing of a Hardy Manufacturing, a Mississippi outdoor wood boiler company and Mandy Gunasekara, a Mississippi politician. Hardy Manufacturing is based in Philadelphia Mississippi, a small town made famous by the murder of 3 civil rights workers in 1964, just north of Mandy’s hometown of Decatur, population 1,426.

Mandy Gunasekara gained notoriety as a Senate aide in 2015 when she handed a snowball to Senator Inhofe on the Senate Floor, so he could mock the idea that the planet was warming. She joined the EPA in March 2017 as the head of the Office of Air and Radiation under then Administrator Scott Pruitt. She is often credited as the chief architect of the Paris Accord withdrawal and central to the repeal of the Clean Power Plan. She left in 2018. There is some speculation that the EPA may have more aggressively rolled back the wood heater 
regulations had she stayed. 
The Hardy family began making
outdoor boilers in 1988 in Mississippi,
long before they became popular in the
upper Midwest and Great Lake states.

In May 2018, the Attorney General of New York filed a Freedom of Information Act request to uncover communication between Mandy Gunasekara, Frank Moore of Hardy Heaters and Dennis Brazier of Central Boiler, and Jack Goldman, John Crouch and Rachel Feinstein of HPBA. However, when Mandy Gunasekara left the EPA, it appeared to undermine HPBA’s efforts. Then, in February of 2020, Mandy Gunasekara came back to the EPA, this time as its Chief of Staff. Sources say that her connection with Hardy Manufacturing may have enabled HPBA to quickly take the March 2020 EPA denial of a sell-through and turn it around, as the Covid-19 pandemic bore down on the country.

Hardy Manufacturing, which began in the late 1980s making heaters to fueled with waste oil, has not certified a Step 2 heater that can be sold after May 15. Frank Moore, President of Hardy was the key industry witness to testify for a 3 year extenion on Capitol Hill in 2017. Possibly thanks to Mandy Gunasekara, they will gain several more months to sell their older units.

The Alliance for Green Heat opposed a one or two-year sell-through because it would have allowed manufacturers to continue building and shipping Step 1 appliances, possibly in great numbers, prior to the May 15 deadline. Allowing a 2-month sell-through at this juncture would not result in flooding the market with Step 1 appliances, as may have happened it were announced in 2018 or 2019. "We would support a short sell-through until August to allow retailers to recoup the time they lost due to this devastating pandemic,” said John Ackerly, President of the Alliance for Green Heat.

Friday, May 1, 2020

Stove Repair Relief Fund to aid families during Coronavirus pandemic

The Alliance for Green Heat is starting a fund that will help families struggling during this pandemic keep their stoves running and operating safely.  Together with the Osprey Foundation and Stove Parts 4 Less, we are launching The Stove Repair Relief Fund!  Please consider becoming a partner in this effort. 

The Stove Repair Relief Fund provides large discounts on stove parts to people who lost their jobs due to the coronavirus pandemic. With an initial fund of $20,000 provided by the Alliance for Green Heat, Stove Parts 4 Less, and the Osprey Foundation, eligible customers will receive 30 – 50% off of their parts orders. The intent is to provide essential stove parts to lower-income families who may not be able to afford to keep their wood or pellet stoves working.  It often only takes a small part to get a pellet stove back up and running or make a dangerous wood stove safe again.  

If you are a verified low-income household or have been laid off due to the pandemic, you are eligible for a 30% discount (15% donated by the Alliance for Green Heat and 15% by Stove Parts 4 Less). If you are from a verified low-income household and have been laid off, you are eligible for a 50% discount on your needed parts (25% donated by the Alliance for Green Heat and 25% by Stove Parts 4 Less).
Please note, this offer is only good for wood or pellet stove parts orders up to $500.  It is not applicable to any grill parts, gas stove parts, new stove installs or orders over $500.  If your household has been hit hard by this pandemic and you need a stove part, provide all required information on the sign-up page here to determine if you are eligible.
We are doing a soft launch of this program at the end of this heating season to assess how it works.  We hope to improve and relaunch it this fall during the upcoming heating season.
The program funders want to ensure that the funds are used to help people who really need it, and are asking people to provide documentation of their employment and economic statusIn addition, funders do not want to subsidize the sale of any parts that are available cheaper elsewhere.  Customers should check prices and ensure that Stove Parts 4 Less is offering the best price, which they usually do (make sure to also include shipping and consider the reputation of the seller for aftermarket parts). They will also match any price.  

The Alliance for Green Heat does not normally partner with or endorse specific companies, but these are not normal times.  Our staff, working with our Board, has done their due diligence to move forward with this program and will re-assess it this summer and publicly share that assessment.

We expect this pandemic to severely impact rural wood heating communities for up to a year, and many may turn to wood heating even more than in previous years.  It may also make people less likely to buy new stoves, and need to keep repairing their old ones for longer.  Pellet stove repair and maintenance has always been a challenge, and dealer training and support for older pellet stoves is often poor.  If stove dealers, NFI or CSIA technicians can't access a part elsewhere, they can alert low income clients of this program.  AGH always recommends that stove installations are completed by professionals, but basic repairs and maintenance are often done by stove owners.  If any repair has safety implications, please consult or hire an NFI technician or other professional before trying to do it yourself, even if you procure the part yourself.
The Alliance for Green Heat and Stove Parts for Less are doing everything we can to keep our employees and local communities safe, and we ask that you try and do the same.  Stay home when possible, cover up your nose and mouth with a mask or scarf and do not host large gatherings.  Save lives and give our medical professionals, first responders and people working in essential businesses a break!
Want to do your part too? Support the Stove Repair Relief Fund!
You can donate too!  To help struggling families who heat with wood and pellets, you can make a tax-deductible donation to the Stove Repair Relief Fund via the Alliance for Green Heat.  Any contributions to support this cause will be matched dollar for dollar by Stove Parts 4 Less, up to $10,000!  Please contact us if your company or institution wants to partner in this effort or has ideas on how to improve it.  100% of all donations will go to helping low-income families in this time of need.