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Costco Wholesale Corporation Clean Air Act Settlement

(Washington, DC - September 3, 2014) - Costco Wholesale Corporation, the nation’s second largest retailer, has agreed to cut its emissions of ozone-depleting and greenhouse gas chemicals from refrigeration equipment at more than half of its stores nationwide. 

In the settlement announced today by the U.S. Environmental Protection Agency (EPA) and Department of Justice (DOJ), Costco will pay $335,000 in penalties for federal Clean Air Act violations and improve refrigerant management at 274 stores at an estimated cost of $2 million over the next three years. 

Overview of Company

Costco Wholesale Corporation, (Costco), the nation’s second largest retailer, is also engaged in the sale of groceries, which often require the use of refrigeration. Violations of EPA’s refrigerant gas requirements were found at many of Costco’s facilities in California, Arizona, Nevada and Hawaii, the states comprising EPA’s Pacific Southwest region.  It was assumed that if investigations continued, more violations would have been found at Costco’s facilities all around the United States.

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According to the complaint, Costco allegedly violated Clean Air Act requirements to properly perform leak detection monitoring and recordkeeping.  These violations include leak detection and repair violations under Title VI, pertaining to ozone depleting substances , and the regulatory scheme found at 40 CFR Part 82, Subpart F, Recycling and Emission Reductions, and more specifically 40 CFR Section 82.156.  The complaint will allege that the company failed to make timely repairs to leaks from refrigeration equipment and failed to maintain proper records.

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Injunctive Relief

The settlement includes the following features:

  • Enhanced leak detection and repair techniques not required by the regulatory structure, but reflecting best industry practices at 274 stores nationwide.
  • The company will pay a $335,000 civil penalty. 
  • The estimated cost of these controls is almost $2 million. 

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Pollutant Impacts

EPA estimates that these measures are expected to prevent more than 105,000 pounds of future releases of ozone-depleting refrigerants that destroy the ozone layer. Because ozone depleting substances are more potent than carbon dioxide in trapping heat in our atmosphere, these ozone depleting substances reduction are the greenhouse gas equivalent of approximately 30,000 metric tons of carbon dioxide per year.  

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Health Effects and Environmental Benefits

The settlement will reduce ozone depleting substances that destroy the ozone layer which destruction results in dangerous amounts of cancer-causing ultraviolet solar radiation striking the earth, increasing skin cancers and cataracts.

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Civil Penalty

Costco will pay a civil penalty of $335,000.

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Comment Period

The proposed settlement, lodged in the U.S. District Court for the Northern District of California, is subject to a 30-day public comment period and final court approval. Information on submitting comment is available at the Department of Justice website.

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For more information, contacts:

Brian Riedel
Region 9
U. S. Environmental Protection Agency
75 Hawthorne Street
San Francisco, CA, 94105

Charlie Garlow
Air Enforcement Division
U. S. Environmental Protection Agency
1200 Pennsylvania Ave, NW (MC 2242A)
Washington, DC 20460 
(202) 564-1088 

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