Sell-Through Would Provide Critical Relief for Retailers, Consumers and Manufacturers
The Hearth, Patio & Barbecue Association (HPBA) welcomes the release today by the U.S. Environmental Protection Agency (EPA) of proposed revisions to regulations affecting wood and pellet stoves, hydronic heaters, and warm air furnaces. The publication, known as a Notice of Proposed Rulemaking (NPRM), contains important changes to the 2015 New Source Performance Standard (NSPS), which updated the EPA rules for wood and pellet stoves, and added a new subpart for hydronic heaters and warm air furnaces.
The NPRM proposes a critical concept which was not included in the original 2015 NSPS: retail sell-through in May 2020. “Sell-through allows for a period of time during which inventory may continue to be sold beyond the date manufacturers must stop producing the same products,” explained Ryan Carroll, Vice President of Government Affairs at HPBA. “Without sell-through, products certified under the May 15, 2015 standards (Step 1) cannot be sold or even given away after May 15, 2020 (Step 2). The result is the stranding of potentially tens of millions of dollars’ worth of investment and cleaner-burning products mere years after meeting Step 1.”
“We’re already seeing a decline in retailer orders for Step 1 appliances in anticipation of the deadline. They can’t afford to be stuck with unsellable appliances,” Carroll noted. “Without a sell-through provision, many small manufacturers will find it nearly impossible to get their new products through the lengthy and expensive certification process. The decrease in sales won’t generate the revenue necessary to complete the testing.”
The proposed sell-through in the NPRM applies only to warm air furnaces and hydronic heaters. HPBA is very disappointed to see that a similar provision is not proposed for wood and pellet stoves which face the same business constraints.
As retail orders for Step 1 appliances decline, some wood and pellet stove manufacturers may have to begin layoffs as early as this winter as they ramp down production. Until more available models meet Step 2, some retail stores may have only a few models available for sale for several years. HPBA also expects to see that significantly fewer appliance choices on the market would lead to higher prices for consumers. This could discourage consumers from switching from an old, uncertified appliance to a cleaner burning one.
“This threat to small business is all because the widely-accepted regulatory concept of sell-through – a provision that was even included in the previous 1988 NSPS and in the Step 1 provisions of the 2015 rule – was unnecessarily left out of the Step 2 provisions of that same rule,” Carroll continued. “As EPA works to finalize the NPRM, we sincerely hope they reconsider this simple relief that will allow consumers to continue to buy cleaner-burning appliances while allowing industry to recoup investments made to comply with a new regulation that was promulgated less than four years ago.”