WASHINGTON (Legal Newsline) – After allegedly failing to comply with regulations regarding the repair of leaky refrigerant from its in-store coolers, grocery chain Trader Joe’s will have to pay a $500,000 civil penalty.
The penalty was levied by the U.S. Environmental Protection Agency (EPA) and the U.S. Department of Justice on June 21. Under the terms of the settlement, Trader Joe’s also agreed to spend approximately $2 million on reducing leakage of ozone depleting substances (ODS) and greenhouse gas (GHG) emissions in its refrigeration systems over the next three years.
The EPA is cracking down on refrigerant leaks because of effects the chemicals have on the ozone layer.
“EPA regulates ozone depleting and greenhouse gas refrigerant emissions to protect the ozone layer and to reduce the global impacts of climate change,” attorney Laura Duncan, principal at Beveridge and Diamond PC in San Fransisco, told Legal Newsline.
The EPA’s regulations targeting ODS require companies to repair refrigerant leaks on all appliances that contain more than 50 pounds of ODS and also observe specific requirements to prevent the release of the chemicals into the atmosphere.
“Detailed recordkeeping is required to demonstrate compliance,” Duncan said.
She said the EPA is also in the process of extending regulations to apply to non-ODS refrigerants that have high global warming potential such as hydrofluorocarbons. Duncan said this is “consistent with EPA goals and President Obama’s 2013 Climate Action Plan.”
As a requirement under the settlement, Trader Joe’s must meet an annual leak rate of 12.1 percent across its 453 stores through 2019. Grocery stores typically have a leak rate of 25 percent. Trader Joe’s is also required to use non-ozone depleting refrigerants in all its new stores and remodels. In at least 15 new or remodeled stores, Trader Joe’s must use an advanced refrigerant, such as carbon dioxide, that has a low GWP.
The EPA found that Trader Joe’s did not repair leaks in a timely manner and did not maintain complete records that are required by the National Recycling and Emissions Reduction Program.
“Given that it is the regulated party’s responsibility to maintain records which demonstrate compliance, it is extremely easy for EPA to review a company’s compliance with the National Recycling and Emission Reduction Program,” Duncan said.
“All EPA needs to do is issue an information request pursuant to Section 114 (a) of the Clean Air Act and the records either show what they need to show or they don’t."
Trader Joe’s will also be audited more frequently and must keep records regarding its refrigerants that the EPA can search.
As for avoiding being targeted by the EPA for refrigerant violations, Duncan said, “Companies should have a refrigerant compliance management plan, and should designate responsibility within the company for monitoring compliance.”
“One of the biggest mistakes we see companies make is to assume that their outside refrigeration contractors are maintaining proper records that will demonstrate compliance.”
The stores will also be made to implement a management system that will check for refrigerant leaks quarterly.