PEARL RIVER, N.Y., Sept. 24, 2021 (GLOBE NEWSWIRE) -- Hudson Technologies, Inc. (NASDAQ: HDSN) announced that, on September 23, 2021, the United States Environmental Protection Agency (EPA) issued the final rule establishing the framework to allocate allowances for virgin production and consumption of HFCs. The EPA is responsible for the administration of the HFC phase down enacted by Congress under the American Innovation and Manufacturing Act of 2020 (the “AIM Act”).
The AIM Act directs the EPA to address the reduction in virgin HFCs and provides authority to do so in three respects: phase down the production and consumption of listed HFCs, manage these HFCs and their substitutes, and facilitate the transition to next-generation technologies. Congress also required that EPA shall consider ways to promote reclamation in all phases of its implementation of the AIM Act. The final rule, announced yesterday, introduces a stepdown of 10% from baseline levels. The actual number of allowances per allowance holder will be issued by October 1, 2021, and these allowances will apply for the 2022 year. Allowances for 2023 and beyond will be issued at a later date, and a subsequent allowance rule must establish a cumulative 40% reduction in the baseline for 2024.
Brian F. Coleman, President and Chief Executive Officer of Hudson Technologies, commented, “We have long been supporters of the bipartisan AIM Act and its directive to the EPA relating to the phase down in production and consumption of virgin HFCs, which we believe will have significant positive impact in the efforts to reduce greenhouse gas emissions and global warming. The ODS phaseout tightened the supply of virgin refrigerants more gradually, over a 15-year period. With the AIM Act, in a little over two years there will be a 40% reduction in virgin production and importation from the current baseline. The reduction in virgin supply should help stimulate significant growth of reclamation in the coming years. With the EPA’s publication of the final rule for HFC allowances, we now have more visibility around how we, and others in our industry, are positioned to supply what is already a large, and growing, installed base of HFC equipment. As the virgin supply of HFCs becomes more limited, we anticipate that reclamation will be critical to maintaining necessary supply during this HFC phasedown period and welcome new industry initiatives that help drive refrigerant recovery and reclamation. With our reclamation capabilities and robust distribution network, Hudson is uniquely positioned as both a supplier and a reclaimer, to meet potential supply shortfalls as virgin HFC production is reduced by 85% in the year 2036.
“A key focus for our Company is promoting sustainability and supporting a circular economy in the refrigerant industry, which we have been doing since our existence. Over the last few decades, we have developed an industry-leading reclamation infrastructure and we also offer complementary services in support of reclamation and system optimization. While the current HFC phasedown has similarities to the previous phaseout of R-22 refrigerants, an important difference is that, today, the reclamation industry is established, while HFC reclaim is in its early stages, with Hudson representing approximately 35% of refrigerant reclamation activity in the U.S. Reclamation is a key component of the orderly phasedown of virgin refrigerants and the AIM Act is designed to assist the EPA to promote the growth of reclamation during the HFC phasedown period. We believe the current phasedown represents a significant long-term growth opportunity and Hudson is ideally and competitively positioned to capitalize on these changes to our industry landscape to grow our customer base and capture additional revenue,” Mr. Coleman concluded.
About Hudson Technologies
Hudson Technologies, Inc. is a leading provider of innovative and sustainable solutions for optimizing performance and enhancing reliability of commercial and industrial chiller plants and refrigeration systems. Hudson's proprietary RefrigerantSide® Services increase operating efficiency, provide energy and cost savings, reduce greenhouse gas emissions and the plant’s carbon footprint while enhancing system life and reliability of operations at the same time. RefrigerantSide® Services can be performed at a customer's site as an integral part of an effective scheduled maintenance program or in response to emergencies. Hudson also offers SMARTenergy OPS®, which is a cloud-based Managed Software as a Service for continuous monitoring, fault detection and diagnostics and real-time optimization of chilled water plants. In addition, the Company sells refrigerants and provides traditional reclamation services for commercial and industrial air conditioning and refrigeration uses. For further information on Hudson, please visit the Company's web site at www.hudsontech.com.
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Statements contained herein which are not historical facts constitute forward-looking statements. Such forward-looking statements involve a number of known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, but are not limited to, changes in the laws and regulations affecting the industry, changes in the demand and price for refrigerants (including unfavorable market conditions adversely affecting the demand for, and the price of, refrigerants), the Company's ability to source refrigerants, regulatory and economic factors, seasonality, competition, litigation, the nature of supplier or customer arrangements that become available to the Company in the future, adverse weather conditions, possible technological obsolescence of existing products and services, possible reduction in the carrying value of long-lived assets, estimates of the useful life of its assets, potential environmental liability, customer concentration, the ability to obtain financing, the ability to meet financial covenants under existing credit facilities, any delays or interruptions in bringing products and services to market, the timely availability of any requisite permits and authorizations from governmental entities and third parties as well as factors relating to doing business outside the United States, including changes in the laws, regulations, policies, and political, financial and economic conditions, including inflation, interest and currency exchange rates, of countries in which the Company may seek to conduct business, the Company’s ability to successfully integrate any assets it acquires from third parties into its operations, the impact of the current COVID-19 pandemic, and other risks detailed in the Company's 10-K for the year ended December 31, 2020 and other subsequent filings with the Securities and Exchange Commission. The words "believe", "expect", "anticipate", "may", "plan", "should" and similar expressions identify forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made.
