Rule Concerning Disclosures Regarding Energy Consumption and Water Use of Certain Home Appliances and Other Products Required Under the Energy Policy and Conservation Act (“Appliance Labeling Rule”), 66307-66314 [05-21817]

Download as PDF Federal Register / Vol. 70, No. 211 / Wednesday, November 2, 2005 / Proposed Rules requirements for Air Force, Navy, and Marine aircraft operating over the Falcon Bombing Range. Specifically, R– 5601F would provide additional maneuvering area needed for aircraft conducting training in adjacent restricted areas R–5601B and R–5601C which are located over the West Range Target Area and the Falcon Bombing Range, respectively. This action would also enhance Fort Sill’s ability to host joint training. The Proposal At the request of the U.S. Army, the FAA is proposing an amendment to Title 14 Code of Federal Regulations (14 CFR) part 73 to establish R–5601F adjacent to and north of R–5601B and R–5601C. Establishment of the new restricted area would provide additional airspace needed to support new high angle air-to-ground training requirements for Air Force, Navy, and Marine aircraft operating over the Falcon Bombing Range and would enhance Fort Sill’s ability to host joint training. The FAA has determined that this proposed regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. Therefore, this proposed regulation: (1) Is not a ‘‘significant regulatory action’’ under Executive Order 12866; (2) is not a ‘‘significant rule’’ under Department of Transportation (DOT) Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this proposed rule, when promulgated, will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. Environmental Review This proposal will be subjected to an environmental analysis in accordance with FAA Order 1050.1E, ‘‘Environmental Impacts: Policies and Procedures,’’ prior to any FAA final regulatory action. List of Subjects in 14 CFR Part 73 Airspace, Prohibited areas, Restricted areas. PART 73—SPECIAL USE AIRSPACE FEDERAL TRADE COMMISSION 1. The authority citation for part 73 continues to read as follows: 16 CFR Part 305 Authority: 49 U.S.C. 106(g), 40103, 40113, 40120; E.O. 10854, 24 FR 9565, 3 CFR, 1959– 1963 Comp., p. 389. § 73.56 [Amended] 2. Section 73.56 is amended as follows: * * * * * R–5601F Fort Sill, OK (New) Boundaries. Beginning at lat. 34°46′24″ N., long. 98°52′00″ W.; thence clockwise via the 49 NM arc of SPS VORTAC to lat. 34°47′00″ N., long. 98°51′00″ W.; to lat. 34°43′46″ N., long. 98°49′55″ W.; thence clockwise via the 46 NM arc of SPS VORTAC to lat. 34°45′03″ N., long. 98°29′46″ W.; to lat. 34°46′15″ N., long. 98°25′01″ W.; to lat. 34°47′00″ N., long. 98°17′46″ W.; to lat. 34°46′45″ N., long. 98°17′01″ W.; to lat. 34°46′06″ N., long. 98°17′01″ W.; to lat. 34°46′06″ N., long. 98°21′01″ W.; to lat. 34°43′45″ N., long. 98°21′01″ W.; to lat. 34°43′30″ N., long. 98°21′21″ W.; to lat. 34°43′30″ N., long. 98°35′40″ W.; to lat. 34°45′00″ N., long. 98°40′31″ W.; to lat. 34°42′15″ N., long. 98°50′01″ W.; to the point of beginning. Excluding that airspace: (1) Below 5500 feet MSL beginning at lat. 34°44′28″ N., long. 98°46′16″ W.; thence clockwise via the 46 NM arc of SPS VORTAC to lat. 34°45′09″ N., long. 98°30′57″ W.; to lat. 34°43′30″ N., long. 98°30′00″ W.; to lat. 34°43′30″ N., long. 98°35′40″ W.; to lat. 34°45′00″ N., long. 98°40′31″ W.; to lat. 34°43′09″ N., long. 98°46′56″ W.; to the point of beginning; and, (2) below 3500 feet MSL within a 1 NM radius of lat. 34°46′46″ N., long. 98°17′46″ W. Designated altitudes. 500 feet AGL to FL 400. Times of Designation. Sunrise to 2200 local time, Monday–Friday; other times by NOTAM. Controlling Agency. FAA, Fort Worth ARTCC. Using Agency. Commanding General, United States Army Field Artillery Center (USAFACFS), Fort Sill, OK. * * * * * Issued in Washington, DC, October 27, 2005. Edith V. Parish, Manager, Airspace and Rules. [FR Doc. 05–21878 Filed 11–1–05; 8:45 am] BILLING CODE 4910–13–P 16:45 Nov 01, 2005 Jkt 208001 PO 00000 RIN 3084–AB03 Rule Concerning Disclosures Regarding Energy Consumption and Water Use of Certain Home Appliances and Other Products Required Under the Energy Policy and Conservation Act (‘‘Appliance Labeling Rule’’) Federal Trade Commission (FTC or Commission). ACTION: Advance notice of proposed rulemaking; request for comment. AGENCY: SUMMARY: Section 137 of the Energy Policy Act of 2005 requires the Commission to conduct a rulemaking to examine the effectiveness of current energy efficiency labeling requirements for consumer products issued pursuant to the Energy Policy and Conservation Act. In response to that directive, the Commission is seeking comments on the effectiveness of the Appliance Labeling Rule and suggestions for improvements to the energy labeling program. The Commission is also requesting comments about the overall costs and benefits of the Rule and its overall regulatory and economic impact as a part of the Commission’s systematic review of all its regulations and guides. DATES: Comments must be received by January 13, 2006. ADDRESSES: Interested parties are invited to submit written comments. Comments should refer to ‘‘Energy Labeling, Project No. R511994’’ to facilitate the organization of comments. A comment filed in paper form should include this reference both in the text and on the envelope, and should be mailed to the following address: Federal Trade Commission/Office of the Secretary, Room H–135 (Annex O), 600 Pennsylvania Avenue, NW., Washington, DC 20580. The FTC is requesting that any comment filed in paper form be sent by courier or overnight service, if possible, because U.S. postal mail in the Washington area and at the Commission is subject to delay due to heightened security precautions. Comments containing confidential material must be filed in paper form, must be clearly labeled ‘‘Confidential,’’ and must comply with Commission Rule 4.9(c).1 1 The comment must be accompanied by an explicit request for confidential treatment, including the factual and legal basis for the request, and must identify the specific portions of the comment to be withheld from the public record. The request will be granted or denied by the Commission’s General Counsel, consistent with The Proposed Amendment In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 73 as follows: VerDate Aug<31>2005 66307 Continued Frm 00008 Fmt 4702 Sfmt 4702 E:\FR\FM\02NOP1.SGM 02NOP1 66308 Federal Register / Vol. 70, No. 211 / Wednesday, November 2, 2005 / Proposed Rules Comments filed in electronic form should be submitted by clicking on the following Web link: https:// secure.commentworks.com/ftcenergylabeling and following the instructions on the Web-based form. To ensure that the Commission considers an electronic comment, you must file it on the Web-based form at the https:// secure.commentworks.com/ftcenergylabeling Web link. You may also visit https://www.regulations.gov to read this advance notice of proposed rulemaking, and may file an electronic comment through that Web site. The Commission will consider all comments that regulations.gov forwards to it. The FTC Act and other laws the Commission administers permit the collection of public comments to consider and use in this proceeding as appropriate. All timely and responsive public comments received by the Commission, whether filed in paper or in electronic form, will be considered by the Commission, and will be available to the public on the FTC Web site, to the extent practicable, at https://www.ftc.gov. As a matter of discretion, the FTC makes every effort to remove home contact information for individuals from public comments it receives before placing those comments on the FTC Web site. More information, including routine uses permitted by the Privacy Act, may be found in the FTC’s privacy policy, at https://www.ftc.gov/privacy.htm. FOR FURTHER INFORMATION CONTACT: Hampton Newsome, Attorney, (202) 326–2889, Division of Enforcement, Federal Trade Commission, 601 New Jersey Avenue, NW., Washington, DC 20580. SUPPLEMENTARY INFORMATION: I. Energy Policy Act of 2005 Section 137 of the Energy Policy Act of 2005 amends the Energy Policy and Conservation Act of 1975 (EPCA) 2 to require the Commission to initiate a rulemaking to consider ‘‘the effectiveness of the consumer products labeling program in assisting consumers in making purchasing decisions and improving energy efficiency.’’ As part of this effort, the Act directs the Commission to consider ‘‘changes to the labeling rules (including categorical labeling) that would improve the effectiveness of consumer product labels.’’ The Act gives the Commission 90 days to initiate the rulemaking and two years to complete it. To implement this directive, the Commission is seeking comments on the effectiveness applicable law and the public interest. See 16 CFR 4.9(c). 2 42 U.S.C. 6291 et seq. VerDate Aug<31>2005 16:45 Nov 01, 2005 Jkt 208001 of the FTC’s energy labeling regulations for consumer products, generally referred to as the Appliance Labeling Rule (16 CFR part 305). II. Energy Policy and Conservation Act Labeling Requirements Section 324 of EPCA requires the FTC to prescribe labeling rules for the disclosure of estimated annual energy cost or alternative energy consumption information for a variety of products covered by the statute, including home appliances (e.g., refrigerators, dishwashers, air conditioners, and furnaces), lighting, and plumbing products.3 EPCA requires that labels for covered appliances disclose the estimated annual operating cost of such products, as determined by the Department of Energy (DOE) test procedures (42 U.S.C. 6294(c)).4 The Commission, however, may require a different measure of energy consumption if DOE determines that the cost disclosure is not technologically feasible, or the Commission determines such a disclosure is not likely to assist consumers in making purchasing decisions or is not economically feasible. Section 324(c) also requires that the label contain information about the range of estimated annual operating costs (or energy consumption) for covered products. The Commission may also require the disclosure of energy information found on the label in any printed material displayed or distributed at the point of sale. In addition, the Commission may direct manufacturers to provide additional energy-related disclosures on the label (or information shipped with the product) including instructions for the maintenance, use, or repair of the covered product. 3 42 U.S.C. 6294. For most appliance products, the Commission must prescribe labeling rules unless it determines that labeling is not technologically or economically feasible (42 U.S.C. 6294(a)(1)). For central air conditioners, heat pumps, furnaces, and clothes washers, the statute requires labeling unless the Commission finds that labeling is not technologically or economically feasible or is not likely to assist consumers in making purchasing decisions (42 U.S.C. 6294(a)(2)(A)). Pursuant to § 6294(a)(1), the Commission determined not to require labeling for television sets, kitchen ranges, ovens, clothes dryers, humidifiers, dehumidifiers, and certain home heating equipment other than furnaces. See 44 FR 66466, 66468–66469 (Nov. 19, 1979). 4 Section 323 of EPCA (42 U.S.C. 6293) directs DOE to develop test procedures for major household appliances. Manufacturers must follow these test procedures to determine their products’ compliance with DOE’s energy conservation standards (required by § 325 of EPCA), and to derive the energy consumption or efficiency values to put on required labels. PO 00000 Frm 00009 Fmt 4702 Sfmt 4702 III. FTC’s Appliance Labeling Rule The Commission’s Appliance Labeling Rule implements the requirements of EPCA by directing manufacturers to disclose energy information about major household appliances. This information enables consumers to compare the energy use or efficiency of competing models.5 When initially published in 1979,6 the Rule applied to eight appliance categories: refrigerators, refrigerator-freezers, freezers, dishwashers, water heaters, clothes washers, room air conditioners, and furnaces. Since then, the Commission has expanded the Rule’s coverage to include central air conditioners, heat pumps, fluorescent lamp ballasts, plumbing products, lighting products, and pool heaters and some other types of water heaters.7 Under the Rule, manufacturers must disclose specific energy consumption or efficiency information about their products at the point of sale in the form of an ‘‘EnergyGuide’’ label affixed to each unit. The information on the EnergyGuide label also must appear in catalogs and on internet sites from which covered products can be ordered. The Rule directs manufacturers to derive the information from standardized tests issued by DOE. Required labels for appliances must also include a ‘‘range of comparability’’ (published by the Commission) that shows the highest and lowest energy consumption or efficiencies for all similar appliance models. These ranges of comparability are intended to help consumers determine how a specific model compares to others available in the market. Labels for most appliances must provide the product’s estimated annual operating cost. Manufacturers must calculate these costs using national average cost figures for energy (e.g., electricity, natural gas, etc.) published by DOE. In addition to the required EnergyGuide labels, manufacturers of furnaces, central air conditioners, and heat pumps must provide cost information for their products in either fact sheets or an industry directory. The Rule contains very specific requirements for the content and format of the EnergyGuide labels. Manufacturers cannot place any information on the label other than that 5 More information about the Rule can be found at https://www.ftc.gov/appliances. 6 44 FR 66466 (Nov. 19, 1979). 7 See 52 FR 46888 (Dec. 10, 1987) (central air conditioners); 59 FR 49556 (Sept. 28, 1994) (pool heaters); 54 FR 28031 (July 5, 1989) (fluorescent lamp ballasts); 58 FR 54955 (Oct. 25, 1993) (certain plumbing products); and 59 FR 25176 (May 13, 1994) (lighting products). E:\FR\FM\02NOP1.SGM 02NOP1 Federal Register / Vol. 70, No. 211 / Wednesday, November 2, 2005 / Proposed Rules specifically allowed by the Rule. In 2000, the Commission issued an exemption allowing manufacturers to include the ‘‘Energy Star’’ logo on the EnergyGuide label for covered appliances (65 FR 17554 (Apr. 30, 2000)). Energy Star is a voluntary labeling program that identifies high efficiency products. The Environmental Protection Agency (EPA) and DOE administer the Energy Star program.8 The Commission’s Rule contains certain reporting requirements which direct manufacturers for most covered products to file reports with the FTC annually and when they begin manufacturing new models. These reports must contain the estimated annual energy consumption or energy efficiency ratings for the appliances derived from tests performed pursuant to the DOE test procedures (16 CFR 305.8(b)). Pursuant to section 305.10, the Commission publishes new ranges of comparability if an analysis of the new information indicates that the upper or lower limits of the ranges have changed by more than 15%. Otherwise, the Commission publishes a statement each year that the prior ranges remain in effect for the next year. The Rule has different labeling requirements for consumer products other than appliances (see 16 CFR 305.11(d), (e), & (f)). For example, manufacturers of fluorescent lamp ballasts and certain tube-type fluorescent bulbs must disclose an encircled ‘‘E’’ on ballasts and on luminaires containing ballasts, as well as on packaging. The ‘‘E’’ signifies compliance with DOE minimum efficiency standards. Manufacturers of showerheads, faucets, toilets, and urinals must disclose water usage information on the products, packaging and labeling. Manufacturers of certain incandescent bulbs, spot and flood bulbs, and screw-base compact fluorescent bulbs must disclose, on packaging, the light output in lumens, energy used in watts, voltage, average life, and number of bulbs. They also must explain how purchasers can select the most energy efficient bulb for their needs. IV. Issues and Questions for Comment As directed by the Energy Policy Act of 2005, the Commission is publishing this notice to seek comment on the effectiveness of the current appliance labeling requirements. The Commission has outlined below some specific issues and questions related to the current labeling program. These issues include the overall effectiveness of existing 8 See https://www.energystar.gov. VerDate Aug<31>2005 16:45 Nov 01, 2005 Jkt 208001 labeling requirements, the need for a new label design, and the benefits and costs of alternative label formats. The Commission is also seeking comments on other issues such as the energy descriptors used on current labels and energy disclosures for products not generally sold in showrooms. The Commission invites interested persons to submit written comments on any issue of fact, law or policy that may bear upon the FTC’s current labeling requirements. All comments should be filed as prescribed in the ADDRESSES section above, and must be received on or before January 13, 2006. After examining the comments received, the Commission will determine whether to propose for comment any specific amendments to the current requirements. A. Effectiveness of Labeling Program The original EnergyGuide label created by the Commission in 1979 contained three energy-related disclosures for most covered products: (1) The estimated annual operating cost of the model, (2) the range of operating costs for similar models displayed in the form of a bar graph, and (3) a grid which provided the operating cost of the model at different energy costs. In 1994, the Commission revised the label so that energy use or efficiency (as opposed to operating cost) appears as the primary descriptor on the label.9 The revised labels continued to display cost information (for most products), but the cost figures were moved to the bottom half of the label. As part of the 1994 review of the Rule, the Commission conducted consumer research and made certain format changes to the EnergyGuide label as a result. These changes enhanced the appearance of the range and bar graph on the label in an effort to reduce consumer confusion (see Figure 1). The Commission has not conducted any consumer research about the effectiveness of the label or alternative formats since adopting those changes in 1994, and the same EnergyGuide label has been in use since that time. In August 2002, the American Council for an Energy Efficient Environment (ACEEE) released a report that summarized research it had conducted 9 The Commission concluded that the use of operating cost as the primary descriptor was not likely to assist consumers. It found, among other things, that changes in national average energy costs necessitated frequent changes to ranges of comparability which, in turn, could yield inconsistent cost information in showrooms. See 53 FR 22106, 22110 (Jun. 13, 1988) and 58 FR 12818, 12827 (Mar. 5, 1993). PO 00000 Frm 00010 Fmt 4702 Sfmt 4702 66309 on the EnergyGuide label’s efficacy.10 The research included manufacturer and consumer interviews, consumer focus groups, a mall intercept survey, and a simulated shopping experiment. According to ACEEE’s report, the interviews and focus groups suggested that consumers are familiar with the EnergyGuide but their use of the label appears to be low. According to these interviews and focus groups, consumers found the label to be overly ‘‘wordy, cluttered, and complex.’’ ACEEE concluded that the EnergyGuide ‘‘can be redesigned to improve consumer comprehension, encourage wider use of the label, and motivate consumers to consider energy use when purchasing a labeled appliance.’’ 11 ACEEE’s 2002 report also examined several different formats and graphical elements for the EnergyGuide label. The ACEEE report considered various categorical labels (i.e., those using a step ranking system such as stars or letters to indicate relative energy use) and continuous labels (i.e., those containing a bar graph or similar item which displays information on a continuous scale without discrete ranks or categories). Among other things, the report recommended the adoption of a ‘‘categorical’’ label based on a star system (e.g., one to five stars). Various types of categorical labels are used in Europe, Australia, Brazil, Thailand, and other countries (see sample European Label at Figure 2).12 According to ACEEE, the research suggested that categorical labels ‘‘are easy to use and quick to decipher.’’ Of the continuous label designs considered, ACEEE found that the bar graph with visible marks denoting the graph’s scale ‘‘appears most promising.’’ 13 ACEEE’s report found that most consumers preferred categorical labels over bar graphs and other ‘‘continuous’’ label designs. To facilitate the Commission’s efforts to consider the effectiveness of the 10 Thorne, Jennifer and Egan, Christine, ‘‘An Evaluation of the Federal Trade Commission’s EnergyGuide Label: Final Report and Recommendations,’’ ACEEE, August 2002 [hereinafter ‘‘ACEEE 2002 Report’’]. The Report was funded in part by DOE, EPA, and other organizations. It is available online at https:// aceee.org/pubs/a021full.pdf. The Commission has not determined what, if any, reliance it will place on the ACEEE’s report (or any other labeling study) during this proceeding. 11 Id. at v–vi. 12 See Wiel, Stephen, and McMahon, James E., ‘‘Energy-Efficiency Labels and Standards: A Guidebook for Appliances, Equipment, and Lighting, 2nd Edition,’’ Collaborative Labeling and Appliance Standards Program (CLASP), 2005. 13 The ACEEE report contains a sample label with such a bar graph (pp. vi and 27–28) in addition to many other sample labels featuring various bar graph and categorical designs. See https://aceee.org/ pubs/a021full.pdf. E:\FR\FM\02NOP1.SGM 02NOP1 66310 Federal Register / Vol. 70, No. 211 / Wednesday, November 2, 2005 / Proposed Rules existing labeling program, we request that commenters consider the following questions: 14 1. Do any recent reports, studies, or research provide data with which to estimate the benefits and costs of current consumer appliance energy labeling programs in the United States? In particular, have any such studies examined the effectiveness of the EnergyGuide label and alternative formats and approaches? Are there any recent studies from other countries that would be helpful for the Commission to consider? 2. How should the Commission measure the ‘‘effectiveness’’ of the appliance labeling program ‘‘in assisting consumers in making purchasing decisions’’? For example, should effectiveness be measured by consumer comprehension of specific label elements, consumer preference for different labels, the impact of labels on product choice, or other means? 3. How effective is the EnergyGuide label in providing consumers with useful, accurate information about the energy consumption or energy efficiency of covered products? What is the net benefit of the current EnergyGuide labels? Can appliance energy labels be modified to increase the net benefits of consumer energy labeling programs in the United States? 4. What is the effectiveness of the current EnergyGuide label in improving energy efficiency? 5. What has been the impact of the Energy Star program on the effectiveness of the EnergyGuide label and its usefulness for consumers? 6. Would changes to the current label design and format significantly improve or have a significant impact upon the effectiveness of the labels? How is the effectiveness of the EnergyGuide label affected by factors unrelated to label design (e.g., consumer priorities)? 7. What changes, if any, should be made to the current appearance of the EnergyGuide label (content, size, format, color, graphical presentation, etc.)? 8. Should the FTC change the EnergyGuide label to require a categorical design such as a star based label? Would a categorical design yield benefits for consumers? What would be the costs of implementing a categorical label system? How would the benefits of such a system compare to the costs? 9. Do commenters have views about the design, methodology, conclusions, 14 Where appropriate, the Commission requests enough detail about data, study design, statistical analysis, and findings to enable the FTC to understand the methodology that was used to conduct the analysis. VerDate Aug<31>2005 16:45 Nov 01, 2005 Jkt 208001 or other aspects of the ACEEE 2002 report? 10. Would a categorical label design significantly improve energy efficiency? Would consumers interpret a categorical label as an indicia of product quality instead of energy performance or efficiency? 11. What criteria would the FTC need to use to assign a star rating to various models in specific product categories (i.e., criteria for a product to receive five stars, one star, etc.)? Would the stars be based on the DOE minimum efficiency standards, the range of energy consumption for models in a particular class, or some other measure? How would a star-based categorical label depict the required ranges? For example, would the lowest rating (i.e., one star) apply to the least efficient products in a product class category regardless of the number of products in the class and the efficiency of those products relative to DOE standards? 12. Would a categorical label require the FTC to make judgments about the relative energy efficiency of products in the market? If so, what information would the Commission need to make such judgments? How would it obtain the necessary information? What would be the costs of making such determinations? 13. Would a star based EnergyGuide label be duplicative of the Energy Star program? Would the star based label cause consumer confusion given the existence of the Energy Star program? 14. Section 305.19 of the Rule contains an exemption which allows manufacturers to place the Energy Star logo on the EnergyGuide label for qualified products. Under the exemption, the Energy Star logo must be placed ‘‘above the comparability bar in the box that contains the applicable range of comparability.’’ Should the Commission consider changes to that exemption (e.g., changes to the placement of the logo on the label)? 15. In addition to considering the categorical label as required by the Energy Policy Act of 2005, should the Commission consider other formats or graphical representations for the EnergyGuide label? Are there improvements that can be made to the current bar graph design in the EnergyGuide label? B. Energy Descriptors For Various Products Currently, EnergyGuide labels for most products provide information on the energy use (or efficiency) of the model, the range of energy use (or efficiency) in the market, and an PO 00000 Frm 00011 Fmt 4702 Sfmt 4702 estimated annual operating cost. The product labels display different energy information depending on the product. For example, refrigerator labels contain energy use information in the form of kilowatt-hours per year while room air conditioners display energy efficiency information through an Energy Efficiency Ratio (EER). In addition, labels for central air conditioning units, heat pumps, furnaces, and pool heaters do not contain cost information. To aid the Commission in considering possible Rule changes for this issue, we request that commenters consider the following questions: 1. Are the current energy descriptors understandable to consumers? What changes, if any, should be made to the energy descriptors used on the EnergyGuide label? 2. Should the FTC consider requiring estimated annual operating costs as the primary descriptor on EnergyGuide labels in lieu of energy consumption or energy efficiency information? What are the costs and benefits of requiring operating costs as the primary descriptor? 3. Should the Commission consider different energy descriptors for existing products? For instance, should the clothes washer label disclose the model’s efficiency rating using the measure currently required by DOE (the ‘‘Modified Energy Factor’’) instead of the product’s annual energy consumption? C. Disclosures for Central Air Conditioning, Heat Pumps, and Furnaces The Commission is also interested in current labeling requirements for products that generally do not appear in showrooms where consumers can compare labels on competing models. Such products include central air conditioning units, heat pumps, and furnaces.15 The Commission seeks comment on whether there are alternatives to labeling that would more effectively communicate energy efficiency information to consumers for such products. Although the Rule requires manufacturers to disclose energy information for these products through means other than labels, such as fact sheets and directories (see 16 CFR 305.11(b)), it is unclear whether such methods provide helpful information for consumers. Fact sheets contain detailed information that may 15 See, e.g., 44 FR at 66470 (Nov. 19, 1979) (‘‘The majority of furnace purchases are made either in the consumer’s home or as part of the consumer’s purchase of a home. As a result, few consumers have an opportunity to see a display model before the furnace is installed.’’). E:\FR\FM\02NOP1.SGM 02NOP1 Federal Register / Vol. 70, No. 211 / Wednesday, November 2, 2005 / Proposed Rules not be easy to understand such as cost charts, regional heating and cooling maps, and equations related to the energy performance. In addition, most industry members provide cost information in industry directories instead of preparing fact sheets. It is unclear whether consumers normally consult these industry directories in making their purchasing decisions. To aid the Commission in evaluating these existing requirements, the Commission seeks information on the following questions: 1. How do consumers generally receive information about the energy efficiency of central air conditioners, heat pumps, and furnaces? 2. Are EnergyGuide labels on central air conditioners, heat pumps, and furnaces assisting consumers in their purchasing decisions? If not, should the Commission consider an alternative method of ensuring that consumers have access to useful efficiency information for these products? 3. Should the Commission consider changes to the current fact sheet requirements for central air conditioners, heat pumps, and furnaces? 4. Are there any alternative or additional forms of information (such as brochures, catalogs, or information sheets) that the FTC could require at the point of sale that would help consumers in making their purchasing decisions for these products? D. Reporting Requirements Section 326(b) of EPCA requires manufacturers to notify the Commission of new models they produce and also directs them to file an annual report with energy consumption information about their products. The annual report information is available on the FTC Web site at https://www.ftc.gov/ appliancedata. To aid the Commission in considering possible changes to the Rule’s reporting requirements, we request that commenters consider the following questions: 1. What changes, if any, should be made to the specific information covered by existing reporting requirements in the Rule? Would such changes improve the effectiveness of the labeling program for consumers? 2. Is there additional product information that the FTC should require, consistent with its statutory authority, in reports from manufacturers? What are the costs and benefits of requiring such additional information? Are there reporting requirements that the FTC should eliminate from the Rule (consistent with current statutory requirements)? VerDate Aug<31>2005 16:45 Nov 01, 2005 Jkt 208001 E. Annual Revisions to the Ranges of Comparability As discussed above, the EnergyGuide label must contain a range of comparability that shows the highest and lowest energy consumption or efficiencies for all similar appliance models. EPCA does not specify when the Commission must change the ranges, but states it cannot do so ‘‘more often than annually.’’ 42 U.S.C. 426(c). The Commission’s regulations indicate that the FTC will revise ranges annually, if appropriate (16 CFR 305.10). For some products, such as dishwashers, the Commission has changed the applicable ranges several times over the last few years. When the Commission changes the ranges, manufacturers must amend their labels to reflect the new ranges and update the operating costs on the labels using a new national average cost of electricity. Frequent range changes can cause the labels on different models in the same showroom to display inconsistent range and cost information because the models on display may have been manufactured at different times. This may be confusing to consumers. Frequent range revisions also impose a burden on manufacturers because they must change their product labels. To aid the Commission in considering possible Rule changes for this issue, we request that commenters consider the following questions: 1. Are changes in the energy use of products in the market significant enough to warrant an examination of the ranges of comparability every year? 2. Should the Commission consider amending the Rule so that the FTC examines the comparability ranges less often than annually? If so, how often should the Commission examine the ranges? Would such a change affect the effectiveness of the labeling program? 3. Are there ways to alleviate potential consumer confusion caused when certain product labels display new range and cost information and other models in the same showroom have labels displaying old range and cost information? F. Lighting and Plumbing Products What changes, if any, should be made to existing labeling requirements for lighting and plumbing products in 16 CFR part 305? What are the costs and benefits of any proposed labeling changes for lighting and plumbing products? V. Regulatory Review The Commission conducts scheduled reviews of its rules and guides in an effort to seek information about their PO 00000 Frm 00012 Fmt 4702 Sfmt 4702 66311 costs and benefits and regulatory and economic impact. The regulatory review of the Appliance Labeling Rule had been scheduled for 2008. The Commission is combining that scheduled regulatory review with the present rulemaking required by the Energy Policy Act of 2005. Accordingly, in addition to the specific questions listed above, the Commission is also soliciting general comments on, among other things, the economic impact of and the continuing need for the Rule; possible conflicts between the Rule and State, local, or other Federal laws; and the effect on the Rule of any technological, economic or other industry changes. The Commission is interested in receiving data, surveys and other empirical evidence to support comments submitted in response to this notice. As part of the regulatory review, the Commission is particularly interested in receiving comments and supporting data in response to the following questions: (A) What benefits, if any, has the Rule provided to consumers of products covered by the Rule? (B) What changes, if any, should be made to the Rule to increase the benefits of the Rule to consumers? How would these changes affect the costs the Rule imposes on industry members? (C) What significant burdens or costs, if any, including costs of compliance, has the Rule imposed on industry members subject to its requirements? Has the Rule provided benefits to such industry members? (D) What changes, if any, should be made to the Rule to reduce the burdens or costs imposed on industry members subject to its requirements? How would these changes affect the benefits provided by the Rule? (E) Does the Rule overlap or conflict with other Federal, State, or local laws or regulations? (F) Since the Rule was issued, what effects, if any, have changes in relevant technology or economic conditions had on the Rule? (G) What significant burdens or costs, if any, including costs of compliance, has the Rule imposed on small businesses subject to its requirements? How do these burdens or costs differ from those imposed on larger businesses subject to the Rule’s requirements? (H) What changes, if any, should be made to the Rule to reduce the burdens or costs imposed on small businesses? How would these changes affect the benefits of the Rule? Would such changes adversely affect the competitive position of larger businesses? E:\FR\FM\02NOP1.SGM 02NOP1 Federal Register / Vol. 70, No. 211 / Wednesday, November 2, 2005 / Proposed Rules (I) Are there any other costs or benefits associated with the Rule? VerDate Aug<31>2005 16:45 Nov 01, 2005 Jkt 208001 List of Subjects in 16 CFR Part 305 Advertising, Consumer protection, Energy conservation, Household PO 00000 Frm 00013 Fmt 4702 Sfmt 4725 appliances, Labeling, Lamp products, Penalties, Reporting and recordkeeping requirements. BILLING CODE 6750–01–P E:\FR\FM\02NOP1.SGM 02NOP1 EP02NO05.061</GPH> 66312 VerDate Aug<31>2005 16:45 Nov 01, 2005 Jkt 208001 PO 00000 Frm 00014 Fmt 4702 Sfmt 4725 E:\FR\FM\02NOP1.SGM 02NOP1 66313 EP02NO05.062</GPH> Federal Register / Vol. 70, No. 211 / Wednesday, November 2, 2005 / Proposed Rules 66314 Federal Register / Vol. 70, No. 211 / Wednesday, November 2, 2005 / Proposed Rules By direction of the Commission. Donald S. Clark, Secretary. [FR Doc. 05–21817 Filed 11–1–05; 8:45 am] because they are concerned only with the administration of Privacy Act systems of records within the Department of Defense. BILLING CODE 6750–01–C Public Law 96–511, ‘‘Paperwork Reduction Act’’ (44 U.S.C. Chapter 35) It has been determined that Privacy Act rules for the Department of Defense impose no information requirements beyond the Department of Defense and that the information collected within the Department of Defense is necessary and consistent with 5 U.S.C. 552a, known as the Privacy Act of 1974. DEPARTMENT OF DEFENSE Defense Contract Audit Agency 32 CFR Part 317 Privacy Act; Implementation Defense Contract Audit Agency. ACTION: Proposed rule. AGENCY: SUMMARY: The Defense Contract Audit Agency (DCAA) is proposing to update the DCAA Privacy Act Program Rules, 32 CFR, Part 317, by deleting references to a cancelled publication and by adding guidance concerning the blanket exemption for classified material. DATES: Comments must be received on or before January 3, 2006 to be considered by this agency. Send comments to Senior Advisor, Defense Contract Audit Agency, Information and Privacy, CM, 8725 John J. Kingman Road, Suite 2135, Fort Belvoir, VA 22060–6201. FOR FURTHER INFORMATION CONTACT: Ms. Debbie Teer at (703) 767–1002. SUPPLEMENTARY INFORMATION: ADDRESSES: Executive Order 12866, ‘‘Regulatory Planning and Review’’ It has been determined that Privacy Act rules for the Department of Defense are not significant rules. The rules do not (1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy; a sector of the economy; productivity; competition; jobs; the environment; public health or safety; or State, local, or tribal governments or communities; (2) Create a serious inconsistency or otherwise interfere with an action taken or planned by another Agency; (3) Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs, or the rights and obligations of recipients thereof; or (4) Raise novel legal or policy issues arising out of legal mandates, the President’s priorities, or the principles set forth in this Executive order. Public Law 96–354, ‘‘Regulatory Flexibility Act’’ (5 U.S.C. Chapter 6) It has been determined that Privacy Act rules for the Department of Defense do not have significant economic impact on a substantial number of small entities VerDate Aug<31>2005 16:45 Nov 01, 2005 Jkt 208001 Section 202, Public Law 104–4, ‘‘Unfunded Mandates Reform Act’’ It has been determined that Privacy Act rulemaking for the Department of Defense does not involve a Federal mandate that may result in the expenditure by State, local and tribal governments, in the aggregate, or by the private sector, of $100 million or more and that such rulemaking will not significantly or uniquely affect small governments. Executive Order 13132, ‘‘Federalism’’ It has been determined that Privacy Act rules for the Department of Defense do not have federalism implications. The rules do not have substantial direct effects on the States, on the relationship between the National Government and the States, or on the distribution of power and responsibilities among the various levels of government. List of Subjects in 32 CFR Part 317 Privacy. Accordingly, 32 CFR part 317 is proposed to be amended as follows: PART 317—DCAA PRIVACY ACT PROGRAM 1. The authority citation for 32 CFR part 317 continues to read as follows: Authority: Pub. L. 93–579, 88 Stat. 1896 (5 U.S.C. 552a) § 317.4 [Amended] 2. Amend § 317.4 as follows: a. Remove paragraph (c)(5). b. Redesignate paragraphs (c)(6), (c)(7), and (c)(8) as (c)(5), (c)(6), and (c)(7). 3. Amend part 317 by adding § 317.7 as follows: § 317.7 Exemptions. All systems of records maintained by DCAA will be exempt from the requirements of 5 U.S.C. 552a(d) and (e)(4)(H) pursuant to 5 U.S.C. 552a(k)(1) to the extent that the system contains any information properly classified under Executive Order 12958, that is PO 00000 Frm 00015 Fmt 4702 Sfmt 4702 required by the Executive Order to be kept secret in the interest of national defense or foreign policy. This exemption, which may be applicable to parts of all systems of records, is necessary since certain record systems, not otherwise specifically designated for exemptions herein, may contain isolated items of information which have been properly classified. Dated: October 27, 2005. L.M. Bynum, Alternate OSD Federal Register Liaison Officer, Department of Defense. [FR Doc. 05–21783 Filed 11–1–05; 8:45 am] BILLING CODE 5001–06–M POSTAL SERVICE 39 CFR Part 111 Bundling Flat-Size and Irregular Parcel Mail—Bundle Integrity Postal Service. Proposed rule. AGENCY: ACTION: SUMMARY: The Postal Service proposes that mailers use two bands to secure all bundles of presorted rate flat-size mail and irregular parcels that are not shrinkwrapped. This proposal would remove the option to secure bundles up to 1 inch thick with only one band. DATES: We must receive your comments on or before December 2, 2005. ADDRESSES: Mail or deliver comments to the Manager, Mailing Standards, U.S. Postal Service, 475 L’Enfant Plaza SW., Rm. 3436, Washington, DC 20260–3436. You may inspect and photocopy all written comments between 9 a.m. and 4 p.m., Monday through Friday, at USPS Headquarters Library, 11th Floor North, 475 L’Enfant Plaza SW., Washington, DC 20260. FOR FURTHER INFORMATION CONTACT: Bill Chatfield at 202–268–7278. SUPPLEMENTARY INFORMATION: We are proposing a revision to Mailing Standards of the United States Postal Service, Domestic Mail Manual (DMM) that would require mailers to use at least two bands—one around the length and one around the girth—when only banding is used to secure bundles of flat-size and irregular parcel mailpieces. ‘‘Bundle integrity’’—the ability of bundles to remain intact—is crucial for our new, high-speed Automated Package Processing System (APPS). Bundles with only one band tend to curl up and allow mailpieces to escape the bundle. When these or other bundles break open, we lose the value of mailers’ presort, and we have to handle individual pieces manually. Manual E:\FR\FM\02NOP1.SGM 02NOP1

Agencies

[Federal Register Volume 70, Number 211 (Wednesday, November 2, 2005)]
[Proposed Rules]
[Pages 66307-66314]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-21817]


=======================================================================
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FEDERAL TRADE COMMISSION

16 CFR Part 305

RIN 3084-AB03


Rule Concerning Disclosures Regarding Energy Consumption and 
Water Use of Certain Home Appliances and Other Products Required Under 
the Energy Policy and Conservation Act (``Appliance Labeling Rule'')

AGENCY: Federal Trade Commission (FTC or Commission).

ACTION: Advance notice of proposed rulemaking; request for comment.

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SUMMARY: Section 137 of the Energy Policy Act of 2005 requires the 
Commission to conduct a rulemaking to examine the effectiveness of 
current energy efficiency labeling requirements for consumer products 
issued pursuant to the Energy Policy and Conservation Act. In response 
to that directive, the Commission is seeking comments on the 
effectiveness of the Appliance Labeling Rule and suggestions for 
improvements to the energy labeling program. The Commission is also 
requesting comments about the overall costs and benefits of the Rule 
and its overall regulatory and economic impact as a part of the 
Commission's systematic review of all its regulations and guides.

DATES: Comments must be received by January 13, 2006.

ADDRESSES: Interested parties are invited to submit written comments. 
Comments should refer to ``Energy Labeling, Project No. R511994'' to 
facilitate the organization of comments. A comment filed in paper form 
should include this reference both in the text and on the envelope, and 
should be mailed to the following address: Federal Trade Commission/
Office of the Secretary, Room H-135 (Annex O), 600 Pennsylvania Avenue, 
NW., Washington, DC 20580. The FTC is requesting that any comment filed 
in paper form be sent by courier or overnight service, if possible, 
because U.S. postal mail in the Washington area and at the Commission 
is subject to delay due to heightened security precautions. Comments 
containing confidential material must be filed in paper form, must be 
clearly labeled ``Confidential,'' and must comply with Commission Rule 
4.9(c).\1\
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    \1\ The comment must be accompanied by an explicit request for 
confidential treatment, including the factual and legal basis for 
the request, and must identify the specific portions of the comment 
to be withheld from the public record. The request will be granted 
or denied by the Commission's General Counsel, consistent with 
applicable law and the public interest. See 16 CFR 4.9(c).

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[[Page 66308]]

    Comments filed in electronic form should be submitted by clicking 
on the following Web link: https://secure.commentworks.com/ftc-
energylabeling and following the instructions on the Web-based form. To 
ensure that the Commission considers an electronic comment, you must 
file it on the Web-based form at the https://secure.commentworks.com/
ftc-energylabeling Web link. You may also visit https://
www.regulations.gov to read this advance notice of proposed rulemaking, 
and may file an electronic comment through that Web site. The 
Commission will consider all comments that regulations.gov forwards to 
it.
    The FTC Act and other laws the Commission administers permit the 
collection of public comments to consider and use in this proceeding as 
appropriate. All timely and responsive public comments received by the 
Commission, whether filed in paper or in electronic form, will be 
considered by the Commission, and will be available to the public on 
the FTC Web site, to the extent practicable, at https://www.ftc.gov. As 
a matter of discretion, the FTC makes every effort to remove home 
contact information for individuals from public comments it receives 
before placing those comments on the FTC Web site. More information, 
including routine uses permitted by the Privacy Act, may be found in 
the FTC's privacy policy, at https://www.ftc.gov/privacy.htm.

FOR FURTHER INFORMATION CONTACT: Hampton Newsome, Attorney, (202) 326-
2889, Division of Enforcement, Federal Trade Commission, 601 New Jersey 
Avenue, NW., Washington, DC 20580.

SUPPLEMENTARY INFORMATION:

I. Energy Policy Act of 2005

    Section 137 of the Energy Policy Act of 2005 amends the Energy 
Policy and Conservation Act of 1975 (EPCA) \2\ to require the 
Commission to initiate a rulemaking to consider ``the effectiveness of 
the consumer products labeling program in assisting consumers in making 
purchasing decisions and improving energy efficiency.'' As part of this 
effort, the Act directs the Commission to consider ``changes to the 
labeling rules (including categorical labeling) that would improve the 
effectiveness of consumer product labels.'' The Act gives the 
Commission 90 days to initiate the rulemaking and two years to complete 
it. To implement this directive, the Commission is seeking comments on 
the effectiveness of the FTC's energy labeling regulations for consumer 
products, generally referred to as the Appliance Labeling Rule (16 CFR 
part 305).
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    \2\ 42 U.S.C. 6291 et seq.
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II. Energy Policy and Conservation Act Labeling Requirements

    Section 324 of EPCA requires the FTC to prescribe labeling rules 
for the disclosure of estimated annual energy cost or alternative 
energy consumption information for a variety of products covered by the 
statute, including home appliances (e.g., refrigerators, dishwashers, 
air conditioners, and furnaces), lighting, and plumbing products.\3\ 
EPCA requires that labels for covered appliances disclose the estimated 
annual operating cost of such products, as determined by the Department 
of Energy (DOE) test procedures (42 U.S.C. 6294(c)).\4\ The Commission, 
however, may require a different measure of energy consumption if DOE 
determines that the cost disclosure is not technologically feasible, or 
the Commission determines such a disclosure is not likely to assist 
consumers in making purchasing decisions or is not economically 
feasible. Section 324(c) also requires that the label contain 
information about the range of estimated annual operating costs (or 
energy consumption) for covered products. The Commission may also 
require the disclosure of energy information found on the label in any 
printed material displayed or distributed at the point of sale. In 
addition, the Commission may direct manufacturers to provide additional 
energy-related disclosures on the label (or information shipped with 
the product) including instructions for the maintenance, use, or repair 
of the covered product.
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    \3\ 42 U.S.C. 6294. For most appliance products, the Commission 
must prescribe labeling rules unless it determines that labeling is 
not technologically or economically feasible (42 U.S.C. 6294(a)(1)). 
For central air conditioners, heat pumps, furnaces, and clothes 
washers, the statute requires labeling unless the Commission finds 
that labeling is not technologically or economically feasible or is 
not likely to assist consumers in making purchasing decisions (42 
U.S.C. 6294(a)(2)(A)). Pursuant to Sec.  6294(a)(1), the Commission 
determined not to require labeling for television sets, kitchen 
ranges, ovens, clothes dryers, humidifiers, dehumidifiers, and 
certain home heating equipment other than furnaces. See 44 FR 66466, 
66468-66469 (Nov. 19, 1979).
    \4\ Section 323 of EPCA (42 U.S.C. 6293) directs DOE to develop 
test procedures for major household appliances. Manufacturers must 
follow these test procedures to determine their products' compliance 
with DOE's energy conservation standards (required by Sec.  325 of 
EPCA), and to derive the energy consumption or efficiency values to 
put on required labels.
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III. FTC's Appliance Labeling Rule

    The Commission's Appliance Labeling Rule implements the 
requirements of EPCA by directing manufacturers to disclose energy 
information about major household appliances. This information enables 
consumers to compare the energy use or efficiency of competing 
models.\5\ When initially published in 1979,\6\ the Rule applied to 
eight appliance categories: refrigerators, refrigerator-freezers, 
freezers, dishwashers, water heaters, clothes washers, room air 
conditioners, and furnaces. Since then, the Commission has expanded the 
Rule's coverage to include central air conditioners, heat pumps, 
fluorescent lamp ballasts, plumbing products, lighting products, and 
pool heaters and some other types of water heaters.\7\
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    \5\ More information about the Rule can be found at https://
www.ftc.gov/appliances.
    \6\ 44 FR 66466 (Nov. 19, 1979).
    \7\ See 52 FR 46888 (Dec. 10, 1987) (central air conditioners); 
59 FR 49556 (Sept. 28, 1994) (pool heaters); 54 FR 28031 (July 5, 
1989) (fluorescent lamp ballasts); 58 FR 54955 (Oct. 25, 1993) 
(certain plumbing products); and 59 FR 25176 (May 13, 1994) 
(lighting products).
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    Under the Rule, manufacturers must disclose specific energy 
consumption or efficiency information about their products at the point 
of sale in the form of an ``EnergyGuide'' label affixed to each unit. 
The information on the EnergyGuide label also must appear in catalogs 
and on internet sites from which covered products can be ordered. The 
Rule directs manufacturers to derive the information from standardized 
tests issued by DOE.
    Required labels for appliances must also include a ``range of 
comparability'' (published by the Commission) that shows the highest 
and lowest energy consumption or efficiencies for all similar appliance 
models. These ranges of comparability are intended to help consumers 
determine how a specific model compares to others available in the 
market. Labels for most appliances must provide the product's estimated 
annual operating cost. Manufacturers must calculate these costs using 
national average cost figures for energy (e.g., electricity, natural 
gas, etc.) published by DOE. In addition to the required EnergyGuide 
labels, manufacturers of furnaces, central air conditioners, and heat 
pumps must provide cost information for their products in either fact 
sheets or an industry directory.
    The Rule contains very specific requirements for the content and 
format of the EnergyGuide labels. Manufacturers cannot place any 
information on the label other than that

[[Page 66309]]

specifically allowed by the Rule. In 2000, the Commission issued an 
exemption allowing manufacturers to include the ``Energy Star'' logo on 
the EnergyGuide label for covered appliances (65 FR 17554 (Apr. 30, 
2000)). Energy Star is a voluntary labeling program that identifies 
high efficiency products. The Environmental Protection Agency (EPA) and 
DOE administer the Energy Star program.\8\
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    \8\ See https://www.energystar.gov.
---------------------------------------------------------------------------

    The Commission's Rule contains certain reporting requirements which 
direct manufacturers for most covered products to file reports with the 
FTC annually and when they begin manufacturing new models. These 
reports must contain the estimated annual energy consumption or energy 
efficiency ratings for the appliances derived from tests performed 
pursuant to the DOE test procedures (16 CFR 305.8(b)). Pursuant to 
section 305.10, the Commission publishes new ranges of comparability if 
an analysis of the new information indicates that the upper or lower 
limits of the ranges have changed by more than 15%. Otherwise, the 
Commission publishes a statement each year that the prior ranges remain 
in effect for the next year.
    The Rule has different labeling requirements for consumer products 
other than appliances (see 16 CFR 305.11(d), (e), & (f)). For example, 
manufacturers of fluorescent lamp ballasts and certain tube-type 
fluorescent bulbs must disclose an encircled ``E'' on ballasts and on 
luminaires containing ballasts, as well as on packaging. The ``E'' 
signifies compliance with DOE minimum efficiency standards. 
Manufacturers of showerheads, faucets, toilets, and urinals must 
disclose water usage information on the products, packaging and 
labeling. Manufacturers of certain incandescent bulbs, spot and flood 
bulbs, and screw-base compact fluorescent bulbs must disclose, on 
packaging, the light output in lumens, energy used in watts, voltage, 
average life, and number of bulbs. They also must explain how 
purchasers can select the most energy efficient bulb for their needs.

IV. Issues and Questions for Comment

    As directed by the Energy Policy Act of 2005, the Commission is 
publishing this notice to seek comment on the effectiveness of the 
current appliance labeling requirements. The Commission has outlined 
below some specific issues and questions related to the current 
labeling program. These issues include the overall effectiveness of 
existing labeling requirements, the need for a new label design, and 
the benefits and costs of alternative label formats. The Commission is 
also seeking comments on other issues such as the energy descriptors 
used on current labels and energy disclosures for products not 
generally sold in showrooms. The Commission invites interested persons 
to submit written comments on any issue of fact, law or policy that may 
bear upon the FTC's current labeling requirements. All comments should 
be filed as prescribed in the ADDRESSES section above, and must be 
received on or before January 13, 2006. After examining the comments 
received, the Commission will determine whether to propose for comment 
any specific amendments to the current requirements.

A. Effectiveness of Labeling Program

    The original EnergyGuide label created by the Commission in 1979 
contained three energy-related disclosures for most covered products: 
(1) The estimated annual operating cost of the model, (2) the range of 
operating costs for similar models displayed in the form of a bar 
graph, and (3) a grid which provided the operating cost of the model at 
different energy costs. In 1994, the Commission revised the label so 
that energy use or efficiency (as opposed to operating cost) appears as 
the primary descriptor on the label.\9\ The revised labels continued to 
display cost information (for most products), but the cost figures were 
moved to the bottom half of the label. As part of the 1994 review of 
the Rule, the Commission conducted consumer research and made certain 
format changes to the EnergyGuide label as a result. These changes 
enhanced the appearance of the range and bar graph on the label in an 
effort to reduce consumer confusion (see Figure 1). The Commission has 
not conducted any consumer research about the effectiveness of the 
label or alternative formats since adopting those changes in 1994, and 
the same EnergyGuide label has been in use since that time.
---------------------------------------------------------------------------

    \9\ The Commission concluded that the use of operating cost as 
the primary descriptor was not likely to assist consumers. It found, 
among other things, that changes in national average energy costs 
necessitated frequent changes to ranges of comparability which, in 
turn, could yield inconsistent cost information in showrooms. See 53 
FR 22106, 22110 (Jun. 13, 1988) and 58 FR 12818, 12827 (Mar. 5, 
1993).
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    In August 2002, the American Council for an Energy Efficient 
Environment (ACEEE) released a report that summarized research it had 
conducted on the EnergyGuide label's efficacy.\10\ The research 
included manufacturer and consumer interviews, consumer focus groups, a 
mall intercept survey, and a simulated shopping experiment. According 
to ACEEE's report, the interviews and focus groups suggested that 
consumers are familiar with the EnergyGuide but their use of the label 
appears to be low. According to these interviews and focus groups, 
consumers found the label to be overly ``wordy, cluttered, and 
complex.'' ACEEE concluded that the EnergyGuide ``can be redesigned to 
improve consumer comprehension, encourage wider use of the label, and 
motivate consumers to consider energy use when purchasing a labeled 
appliance.'' \11\
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    \10\ Thorne, Jennifer and Egan, Christine, ``An Evaluation of 
the Federal Trade Commission's EnergyGuide Label: Final Report and 
Recommendations,'' ACEEE, August 2002 [hereinafter ``ACEEE 2002 
Report'']. The Report was funded in part by DOE, EPA, and other 
organizations. It is available online at https://aceee.org/pubs/
a021full.pdf. The Commission has not determined what, if any, 
reliance it will place on the ACEEE's report (or any other labeling 
study) during this proceeding.
    \11\ Id. at v-vi.
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    ACEEE's 2002 report also examined several different formats and 
graphical elements for the EnergyGuide label. The ACEEE report 
considered various categorical labels (i.e., those using a step ranking 
system such as stars or letters to indicate relative energy use) and 
continuous labels (i.e., those containing a bar graph or similar item 
which displays information on a continuous scale without discrete ranks 
or categories). Among other things, the report recommended the adoption 
of a ``categorical'' label based on a star system (e.g., one to five 
stars). Various types of categorical labels are used in Europe, 
Australia, Brazil, Thailand, and other countries (see sample European 
Label at Figure 2).\12\ According to ACEEE, the research suggested that 
categorical labels ``are easy to use and quick to decipher.'' Of the 
continuous label designs considered, ACEEE found that the bar graph 
with visible marks denoting the graph's scale ``appears most 
promising.'' \13\ ACEEE's report found that most consumers preferred 
categorical labels over bar graphs and other ``continuous'' label 
designs.
---------------------------------------------------------------------------

    \12\ See Wiel, Stephen, and McMahon, James E., ``Energy-
Efficiency Labels and Standards: A Guidebook for Appliances, 
Equipment, and Lighting, 2nd Edition,'' Collaborative Labeling and 
Appliance Standards Program (CLASP), 2005.
    \13\ The ACEEE report contains a sample label with such a bar 
graph (pp. vi and 27-28) in addition to many other sample labels 
featuring various bar graph and categorical designs. See https://
aceee.org/pubs/a021full.pdf.
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    To facilitate the Commission's efforts to consider the 
effectiveness of the

[[Page 66310]]

existing labeling program, we request that commenters consider the 
following questions: \14\
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    \14\ Where appropriate, the Commission requests enough detail 
about data, study design, statistical analysis, and findings to 
enable the FTC to understand the methodology that was used to 
conduct the analysis.
---------------------------------------------------------------------------

    1. Do any recent reports, studies, or research provide data with 
which to estimate the benefits and costs of current consumer appliance 
energy labeling programs in the United States? In particular, have any 
such studies examined the effectiveness of the EnergyGuide label and 
alternative formats and approaches? Are there any recent studies from 
other countries that would be helpful for the Commission to consider?
    2. How should the Commission measure the ``effectiveness'' of the 
appliance labeling program ``in assisting consumers in making 
purchasing decisions''? For example, should effectiveness be measured 
by consumer comprehension of specific label elements, consumer 
preference for different labels, the impact of labels on product 
choice, or other means?
    3. How effective is the EnergyGuide label in providing consumers 
with useful, accurate information about the energy consumption or 
energy efficiency of covered products? What is the net benefit of the 
current EnergyGuide labels? Can appliance energy labels be modified to 
increase the net benefits of consumer energy labeling programs in the 
United States?
    4. What is the effectiveness of the current EnergyGuide label in 
improving energy efficiency?
    5. What has been the impact of the Energy Star program on the 
effectiveness of the EnergyGuide label and its usefulness for 
consumers?
    6. Would changes to the current label design and format 
significantly improve or have a significant impact upon the 
effectiveness of the labels? How is the effectiveness of the 
EnergyGuide label affected by factors unrelated to label design (e.g., 
consumer priorities)?
    7. What changes, if any, should be made to the current appearance 
of the EnergyGuide label (content, size, format, color, graphical 
presentation, etc.)?
    8. Should the FTC change the EnergyGuide label to require a 
categorical design such as a star based label? Would a categorical 
design yield benefits for consumers? What would be the costs of 
implementing a categorical label system? How would the benefits of such 
a system compare to the costs?
    9. Do commenters have views about the design, methodology, 
conclusions, or other aspects of the ACEEE 2002 report?
    10. Would a categorical label design significantly improve energy 
efficiency? Would consumers interpret a categorical label as an indicia 
of product quality instead of energy performance or efficiency?
    11. What criteria would the FTC need to use to assign a star rating 
to various models in specific product categories (i.e., criteria for a 
product to receive five stars, one star, etc.)? Would the stars be 
based on the DOE minimum efficiency standards, the range of energy 
consumption for models in a particular class, or some other measure? 
How would a star-based categorical label depict the required ranges? 
For example, would the lowest rating (i.e., one star) apply to the 
least efficient products in a product class category regardless of the 
number of products in the class and the efficiency of those products 
relative to DOE standards?
    12. Would a categorical label require the FTC to make judgments 
about the relative energy efficiency of products in the market? If so, 
what information would the Commission need to make such judgments? How 
would it obtain the necessary information? What would be the costs of 
making such determinations?
    13. Would a star based EnergyGuide label be duplicative of the 
Energy Star program? Would the star based label cause consumer 
confusion given the existence of the Energy Star program?
    14. Section 305.19 of the Rule contains an exemption which allows 
manufacturers to place the Energy Star logo on the EnergyGuide label 
for qualified products. Under the exemption, the Energy Star logo must 
be placed ``above the comparability bar in the box that contains the 
applicable range of comparability.''
    Should the Commission consider changes to that exemption (e.g., 
changes to the placement of the logo on the label)?
    15. In addition to considering the categorical label as required by 
the Energy Policy Act of 2005, should the Commission consider other 
formats or graphical representations for the EnergyGuide label? Are 
there improvements that can be made to the current bar graph design in 
the EnergyGuide label?

B. Energy Descriptors For Various Products

    Currently, EnergyGuide labels for most products provide information 
on the energy use (or efficiency) of the model, the range of energy use 
(or efficiency) in the market, and an estimated annual operating cost. 
The product labels display different energy information depending on 
the product. For example, refrigerator labels contain energy use 
information in the form of kilowatt-hours per year while room air 
conditioners display energy efficiency information through an Energy 
Efficiency Ratio (EER). In addition, labels for central air 
conditioning units, heat pumps, furnaces, and pool heaters do not 
contain cost information.
    To aid the Commission in considering possible Rule changes for this 
issue, we request that commenters consider the following questions:
    1. Are the current energy descriptors understandable to consumers? 
What changes, if any, should be made to the energy descriptors used on 
the EnergyGuide label?
    2. Should the FTC consider requiring estimated annual operating 
costs as the primary descriptor on EnergyGuide labels in lieu of energy 
consumption or energy efficiency information? What are the costs and 
benefits of requiring operating costs as the primary descriptor?
    3. Should the Commission consider different energy descriptors for 
existing products? For instance, should the clothes washer label 
disclose the model's efficiency rating using the measure currently 
required by DOE (the ``Modified Energy Factor'') instead of the 
product's annual energy consumption?

C. Disclosures for Central Air Conditioning, Heat Pumps, and Furnaces

    The Commission is also interested in current labeling requirements 
for products that generally do not appear in showrooms where consumers 
can compare labels on competing models. Such products include central 
air conditioning units, heat pumps, and furnaces.\15\ The Commission 
seeks comment on whether there are alternatives to labeling that would 
more effectively communicate energy efficiency information to consumers 
for such products. Although the Rule requires manufacturers to disclose 
energy information for these products through means other than labels, 
such as fact sheets and directories (see 16 CFR 305.11(b)), it is 
unclear whether such methods provide helpful information for consumers. 
Fact sheets contain detailed information that may

[[Page 66311]]

not be easy to understand such as cost charts, regional heating and 
cooling maps, and equations related to the energy performance. In 
addition, most industry members provide cost information in industry 
directories instead of preparing fact sheets. It is unclear whether 
consumers normally consult these industry directories in making their 
purchasing decisions. To aid the Commission in evaluating these 
existing requirements, the Commission seeks information on the 
following questions:
---------------------------------------------------------------------------

    \15\ See, e.g., 44 FR at 66470 (Nov. 19, 1979) (``The majority 
of furnace purchases are made either in the consumer's home or as 
part of the consumer's purchase of a home. As a result, few 
consumers have an opportunity to see a display model before the 
furnace is installed.'').
---------------------------------------------------------------------------

    1. How do consumers generally receive information about the energy 
efficiency of central air conditioners, heat pumps, and furnaces?
    2. Are EnergyGuide labels on central air conditioners, heat pumps, 
and furnaces assisting consumers in their purchasing decisions? If not, 
should the Commission consider an alternative method of ensuring that 
consumers have access to useful efficiency information for these 
products?
    3. Should the Commission consider changes to the current fact sheet 
requirements for central air conditioners, heat pumps, and furnaces?
    4. Are there any alternative or additional forms of information 
(such as brochures, catalogs, or information sheets) that the FTC could 
require at the point of sale that would help consumers in making their 
purchasing decisions for these products?

D. Reporting Requirements

    Section 326(b) of EPCA requires manufacturers to notify the 
Commission of new models they produce and also directs them to file an 
annual report with energy consumption information about their products. 
The annual report information is available on the FTC Web site at 
https://www.ftc.gov/appliancedata. To aid the Commission in considering 
possible changes to the Rule's reporting requirements, we request that 
commenters consider the following questions:
    1. What changes, if any, should be made to the specific information 
covered by existing reporting requirements in the Rule? Would such 
changes improve the effectiveness of the labeling program for 
consumers?
    2. Is there additional product information that the FTC should 
require, consistent with its statutory authority, in reports from 
manufacturers? What are the costs and benefits of requiring such 
additional information? Are there reporting requirements that the FTC 
should eliminate from the Rule (consistent with current statutory 
requirements)?

E. Annual Revisions to the Ranges of Comparability

    As discussed above, the EnergyGuide label must contain a range of 
comparability that shows the highest and lowest energy consumption or 
efficiencies for all similar appliance models. EPCA does not specify 
when the Commission must change the ranges, but states it cannot do so 
``more often than annually.'' 42 U.S.C. 426(c). The Commission's 
regulations indicate that the FTC will revise ranges annually, if 
appropriate (16 CFR 305.10). For some products, such as dishwashers, 
the Commission has changed the applicable ranges several times over the 
last few years. When the Commission changes the ranges, manufacturers 
must amend their labels to reflect the new ranges and update the 
operating costs on the labels using a new national average cost of 
electricity. Frequent range changes can cause the labels on different 
models in the same showroom to display inconsistent range and cost 
information because the models on display may have been manufactured at 
different times. This may be confusing to consumers. Frequent range 
revisions also impose a burden on manufacturers because they must 
change their product labels. To aid the Commission in considering 
possible Rule changes for this issue, we request that commenters 
consider the following questions:
    1. Are changes in the energy use of products in the market 
significant enough to warrant an examination of the ranges of 
comparability every year?
    2. Should the Commission consider amending the Rule so that the FTC 
examines the comparability ranges less often than annually? If so, how 
often should the Commission examine the ranges? Would such a change 
affect the effectiveness of the labeling program?
    3. Are there ways to alleviate potential consumer confusion caused 
when certain product labels display new range and cost information and 
other models in the same showroom have labels displaying old range and 
cost information?

F. Lighting and Plumbing Products

    What changes, if any, should be made to existing labeling 
requirements for lighting and plumbing products in 16 CFR part 305? 
What are the costs and benefits of any proposed labeling changes for 
lighting and plumbing products?

V. Regulatory Review

    The Commission conducts scheduled reviews of its rules and guides 
in an effort to seek information about their costs and benefits and 
regulatory and economic impact. The regulatory review of the Appliance 
Labeling Rule had been scheduled for 2008. The Commission is combining 
that scheduled regulatory review with the present rulemaking required 
by the Energy Policy Act of 2005. Accordingly, in addition to the 
specific questions listed above, the Commission is also soliciting 
general comments on, among other things, the economic impact of and the 
continuing need for the Rule; possible conflicts between the Rule and 
State, local, or other Federal laws; and the effect on the Rule of any 
technological, economic or other industry changes.
    The Commission is interested in receiving data, surveys and other 
empirical evidence to support comments submitted in response to this 
notice. As part of the regulatory review, the Commission is 
particularly interested in receiving comments and supporting data in 
response to the following questions:
    (A) What benefits, if any, has the Rule provided to consumers of 
products covered by the Rule?
    (B) What changes, if any, should be made to the Rule to increase 
the benefits of the Rule to consumers? How would these changes affect 
the costs the Rule imposes on industry members?
    (C) What significant burdens or costs, if any, including costs of 
compliance, has the Rule imposed on industry members subject to its 
requirements? Has the Rule provided benefits to such industry members?
    (D) What changes, if any, should be made to the Rule to reduce the 
burdens or costs imposed on industry members subject to its 
requirements? How would these changes affect the benefits provided by 
the Rule?
    (E) Does the Rule overlap or conflict with other Federal, State, or 
local laws or regulations?
    (F) Since the Rule was issued, what effects, if any, have changes 
in relevant technology or economic conditions had on the Rule?
    (G) What significant burdens or costs, if any, including costs of 
compliance, has the Rule imposed on small businesses subject to its 
requirements? How do these burdens or costs differ from those imposed 
on larger businesses subject to the Rule's requirements?
    (H) What changes, if any, should be made to the Rule to reduce the 
burdens or costs imposed on small businesses? How would these changes 
affect the benefits of the Rule? Would such changes adversely affect 
the competitive position of larger businesses?

[[Page 66312]]

    (I) Are there any other costs or benefits associated with the Rule?

List of Subjects in 16 CFR Part 305

    Advertising, Consumer protection, Energy conservation, Household 
appliances, Labeling, Lamp products, Penalties, Reporting and 
recordkeeping requirements.
BILLING CODE 6750-01-P
[GRAPHIC] [TIFF OMITTED] TP02NO05.061


[[Page 66313]]


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[[Page 66314]]


    By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 05-21817 Filed 11-1-05; 8:45 am]
BILLING CODE 6750-01-C
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