Energy Conservation Program for Certain Industrial Equipment: Determination Concerning the Potential for Energy Conservation Standards for Small Electric Motors, 38799-38808 [E6-10437]
Download as PDF
<![CDATA[
38799
Proposed Rules
Federal Register
Vol. 71, No. 131
Monday, July 10, 2006
This section of the FEDERAL REGISTER
contains notices to the public of the proposed
issuance of rules and regulations. The
purpose of these notices is to give interested
persons an opportunity to participate in the
rule making prior to the adoption of the final
rules.
DEPARTMENT OF ENERGY
Office of Energy Efficiency and
Renewable Energy
10 CFR Part 431
[Docket No. EE–DET–02–002]
RIN 1904–AA87
Energy Conservation Program for
Certain Industrial Equipment:
Determination Concerning the
Potential for Energy Conservation
Standards for Small Electric Motors
Office of Energy Efficiency and
Renewable Energy, Department of
Energy.
ACTION: Departmental determination.
jlentini on PROD1PC65 with PROPOSAL
AGENCY:
SUMMARY: The Department of Energy
(DOE or the Department) has
determined, based on the best
information currently available, that
energy conservation standards for
certain single-phase, capacitor-start,
induction-run, small electric motors are
technologically feasible and
economically justified, and would result
in significant energy savings. This
determination initiates the process of
establishing, by notice and comment
rulemaking, test procedures and energy
conservation standards for this
equipment.
ADDRESSES: For access to the docket
(EE–DET–02–002) to read background
documents or comments received, visit
the U.S. Department of Energy, Forrestal
Building, Room 1J–018 (Resource Room
of the Building Technologies Program),
1000 Independence Avenue, SW.,
Washington, DC, (202) 586–2945,
between 9 a.m. and 4 p.m., Monday
through Friday, except Federal holidays.
Please call Ms. Brenda Edwards-Jones at
the above telephone number for
additional information regarding
visiting the Resource Room. Please note:
The Department’s Freedom of
Information Reading Room (formerly
Room 1E–190 at the Forrestal Building)
is no longer housing rulemaking
materials.
VerDate Aug<31>2005
17:09 Jul 07, 2006
Jkt 208001
FOR FURTHER INFORMATION CONTACT:
Antonio Bouza, U.S. Department of
Energy, Building Technologies Program
(EE–2J), Office of Energy Efficiency and
Renewable Energy, 1000 Independence
Avenue, SW., Washington, DC 20585–
0121. Telephone (202) 586–4563, or
antonio.bouza@ee.doe.gov.
Thomas B. DePriest, Esq., U.S.
Department of Energy, Office of General
Counsel, Mail Station GC–72, 1000
Independence Avenue, SW.,
Washington, DC 20585–0121.
Telephone (202) 586–7432, or
thomas.depriest@hq.doe.gov.
SUPPLEMENTARY INFORMATION:
I. Introduction
A. Authority
B. Rulemaking Procedures
C. Background
II. Discussion of the Analysis of Small Motors
A. Purpose and Content
B. Methodology
1. Market Research
2. Engineering Analysis
3. Life-Cycle Cost Analysis
4. National Energy Savings Analysis
5. National Consumer Impacts Analysis
C. Analysis Results
1. Engineering Analysis
2. Life-Cycle Cost and Payback Period
Analysis
3. National Energy Savings and Consumer
Impacts
D. Discussion
1. Significance of Energy Savings
2. Impact on Consumers
III. Conclusion
A. Determination
B. Future Proceedings
I. Introduction
A. Authority
The National Energy Conservation
Policy Act of 1978, amended the Energy
Policy and Conservation Act (EPCA or
the Act) to add a part C to title III of
EPCA, to establish an energyconservation program for certain
industrial equipment. (42 U.S.C. 6311–
6317) The Energy Policy Act of 1992
(EPACT), Public Law 102–486, also
amended EPCA, and included
amendments that expanded title III to
include small electric motors.
Specifically, EPACT amended section
346 of EPCA (42 U.S.C. 6317) to provide
in paragraph (b) that the Secretary of
Energy must prescribe testing
requirements and energy conservation
standards for those small electric motors
for which the Secretary determines that
standards ‘‘would be technologically
feasible and economically justified, and
PO 00000
Frm 00001
Fmt 4702
Sfmt 4702
would result in significant energy
savings.’’ (42 U.S.C. 6317(b)(1)).
DOE construes section 346 in light of
the provisions of section 325(n) and (o)
of EPCA (which are in part B of title III
of EPCA and apply specifically to
residential appliances). DOE does so for
two reasons. First, section 346(c)
specifically makes the criteria in section
325(n) applicable to the determination
for small motor standards. (42 U.S.C.
6317(c)) Second, and more generally,
section 345(a) makes subsections (l)
through (s) of section 325 applicable to
provisions of part C of title III of EPCA
which includes section 346. (42 U.S.C.
6316(a)).
Section 325(n) deals with petitions for
amended standards. Paragraph (n)(2) of
section 325(n) provides for an initial
determination by DOE of technological
feasibility, economic justification, and
significant energy savings in deciding
whether to grant a petition. This initial
determination does not focus on specific
standard levels. Paragraph (n)(2) further
provides that the initial determination
does not create any presumption with
regard to the application of these
statutory criteria for promulgating
specific standards in a rulemaking
pursuant to DOE’s decision to grant a
petition. Section 325(o)(2) requires that
determinations of technological
feasibility, economic justification, and
significant energy saving must
ultimately be based on specific
standards levels that were proposed for
public comment. (42 U.S.C. 6295(o)(2))
The textual linkage of these provisions
of section 325 to section 346(b) implies
that today’s determination is similar in
character and legal effect to an initial
determination upon a petition for new
or amended standards and that it does
not create any presumptions with regard
to the determination of specific standard
levels yet to be proposed.
In addition to this structural analysis
of EPCA, DOE is also of the view that,
as a matter of policy, it is impractical to
proceed on any other basis. It is
impractical because, even if one or more
design options have the potential for
achieving energy savings, a
determination that such savings could
in fact be achieved cannot be made
without first having developed test
procedures to measure the energy
efficiency of small motors designs, and
then conducting an in-depth analysis of
each design option. Such analysis might
E:\FR\FM\10JYP1.SGM
10JYP1
jlentini on PROD1PC65 with PROPOSAL
38800
Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 / Proposed Rules
show that no standard meets all three of
the prescribed criteria: i.e.,
technological feasibility, economic
justification and significant energy
savings.
For these reasons, the Department
construes section 346(b) and related
provisions as requiring it to: (1)
Determine preliminarily whether
standards for small motors would be
‘‘technologically feasible and
economically justified, and would result
in significant energy savings,’’ and (2) if
energy conservation standards appear to
be warranted under these criteria,
prescribe test procedures and conduct a
rulemaking concerning such standards.
During the standards rulemaking, the
Department would describe whether,
and at what level(s), to promulgate
energy conservation standards. This
decision would be based on in-depth
consideration, with public participation,
of the technological feasibility,
economic justification, and energy
savings of potential standard levels in
the context of the criteria and
procedures for prescribing new or
amended standards established by
section 325(o) and (p) (42 U.S.C.
6295(o), (p)).
Section 340(13)(F) of EPCA (42 U.S.C.
6311(13)(F)) provides the following
definition for ‘‘small electric motor’’:
The term ‘‘small electric motor’’ means
a NEMA [National Electrical
Manufacturers Association] generalpurpose alternating-current single-speed
induction motor, built in a two-digit
frame number series in accordance with
NEMA Standards Publication MG1–
1987.
In NEMA Standards Publication
MG1–1987, which is entitled ‘‘Motors
and Generators,’’ the two-digit frame
series encompasses NEMA frame sizes
42, 48, and 56, and motors with
horsepower ratings ranging from 1⁄4 to 3
horsepower. These motors operate at 60
hertz and have either a single-phase or
a three-phase electrical design.
Section 346(b)(3) of EPCA (42 U.S.C.
6317(b)(3)) specifies that a standard
prescribed for small electric motors
shall not apply to any small electric
motor that is a component of a covered
product under section 322(a) of EPCA
(42 U.S.C. 6292(a)) or of covered
equipment under section 340 (42 U.S.C.
6311). Such products and equipment
include residential air conditioners and
heat pumps, furnaces, refrigerators and
freezers, clothes washers and dryers,
and commercial packaged airconditioning and heating equipment.
B. Rulemaking Procedures
EPCA does not explicitly identify the
rulemaking procedures that govern
VerDate Aug<31>2005
17:09 Jul 07, 2006
Jkt 208001
promulgation of test procedures and
standards for small electric motors. In
conducting rulemakings generally, the
Department must, at a minimum, adhere
to the procedures required by the
Administrative Procedure Act (5 U.S.C.
551 et seq.) and section 501 of the
Department of Energy Organization Act
(DOE Organization Act) (42 U.S.C.
7191). Section 501 of the DOE
Organization Act in essence requires the
following: (1) Issuance of a notice of
proposed rulemaking (NOPR), (2) an
opportunity for comment, (3) an
opportunity for presentation of oral
comments, if there exists ‘‘a substantial
issue of fact or law’’ or if the rule will
have a ‘‘substantial impact,’’ and (4)
publication of the final rule
accompanied by appropriate
explanation. Pursuant to Executive
Order 12889, ‘‘Implementation of the
North American Free Trade
Agreement,’’ December 27, 1993, the
comment period on a NOPR must be at
least 75 days.
Consistent with section 345(a), in
promulgating test procedures for small
electric motors, the Department will
also use procedures prescribed for
adopting test procedures under parts B
and C of EPCA. (42 U.S.C. 6293(b)(2)
and 6314(b)) Therefore, in addition to
the generic procedural requirements
described above, the Department will
provide an opportunity for oral
comment (i.e., hold a public meeting) on
the proposed test procedures, regardless
of the ‘‘substantial issue’’ or ‘‘substantial
impact’’ criteria, as it does in other
EPCA test procedure rulemakings. See,
for example, 42 U.S.C. 6314(b).
Consistent with section 345(a), in
determining by rule whether to impose
a specified standard level, the
Department will use the following
procedures:
1. The Department will issue an
advance notice of proposed rulemaking
(ANOPR), followed by a comment
period (42. U.S.C. 6295 (p)(1));
2. The Department will issue a NOPR
setting forth the maximum efficiency
improvement that is technologically
feasible and, if the proposed standard
does not achieve this level, an
explanation of why (42 U.S.C.
6295(p)(2)); and
3. The Department will hold a public
meeting following issuance of the
NOPR. (42 U.S.C. 6306(a)(1).)
In addition, the Department also has
a policy, in conducting rulemakings on
appliance standards, of allowing 75
days for comment on an ANOPR (rather
than the 60 days required by EPCA),
with at least one public hearing or
meeting during this period. Procedures
for Consideration of New or Revised
PO 00000
Frm 00002
Fmt 4702
Sfmt 4702
Energy Conservation Standards for
Consumer Products, 10 CFR part 430,
subpart C, Appendix A (Process Rule).
C. Background
The Department began the analysis for
this determination by collecting
information from manufacturers of
small motors and others. The
Department conducted preliminary
analyses and shared its preliminary
findings regarding efficiency
improvement in small motors.
Subsequently, the Department received
data and information, including that
provided by both the National Electrical
Manufacturers Association (NEMA) and
the Small Motors and Motion
Association (SMMA) (the NEMA/
SMMA Working Group).
A key issue that arose early in this
determination process is the definition
of a ‘‘small electric motor’’ and precisely
which motors are covered by this
rulemaking. The definition of a ‘‘small
electric motor’’ derives from the
definition of the term ‘‘general purpose
motor.’’ The EPCA definition 1 of a
small motor is tied to the NEMA
Standards Publication MG1–1987
performance requirements that NEMA
has established for general purpose
motors, such as the minimum levels for
breakdown and locked rotor torque for
small electric motors presented in MG1–
1987 paragraph 12.32.
In this determination process, the
Department considered only those
classes of small electric motors covered
under the EPCA definition which satisfy
the performance requirements for
general purpose motors established by
NEMA Standards Publication MG1–
1987, and which are not a component of
another product covered under EPCA.
In consideration of the above, DOE
finds that of the motors that satisfy the
frame-size requirements of the smallmotors definition, only a subset satisfies
the other performance requirements of
1 EPCA does not define the term ‘‘general purpose
motor,’’ although it does define the terms ‘‘definite
purpose motor’’ and ‘‘special purpose motor.’’
According to EPCA, ‘‘definite purpose motor’’
means ‘‘any motor designed in standard ratings
with standard operating characteristics or standard
mechanical construction for use under service
conditions other than usual or for use on a
particular type of application and which cannot be
used in most general purpose applications.’’ Section
340(13)(B). (42 U.S.C. 6311 (13)(B)) Likewise,
‘‘special purpose motor’’ means ‘‘any motor, other
than a general purpose motor or definite purpose
motor, which has special operating characteristics
or special mechanical construction, or both,
designed for a particular application. ‘‘ Id. at (C).
Consequently, DOE must derive the term ‘‘general
purpose’’ by eliminating those definite purpose
motors and special purpose motors and must
subsequently define the term within the context of
NEMA performance characteristics that can operate
successfully in many different applications.
E:\FR\FM\10JYP1.SGM
10JYP1
Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 / Proposed Rules
jlentini on PROD1PC65 with PROPOSAL
the definition. Among single-phase
motors with a two-digit frame size, the
Department found that only capacitorstart motors, including both capacitorstart, induction run and capacitor-start,
capacitor-run motors, can meet the
torque requirements for NEMA generalpurpose motors. Among three-phase
small motors, the Department found that
only non-servo motors can meet the
NEMA performance requirements for
general-purpose motors. Hence, the
Department’s analysis covered only
these types of single- and three-phase
small motors, and the Department
identifies them in this determination as
‘‘considered small motors.’’ The annual
commercial sales volume of considered
small motors is approximately four
million units for capacitor-start motors
and one million units for three-phase
motors. These motors are used in a wide
variety of commercial and industrial
machine and processing applications,
with the largest being pumping
equipment and commercial/industrial
heating, ventilating, and airconditioning equipment rated over
760,000 British thermal units per hour
(Btu/h).
The Department then conducted an
analysis that estimated the likely range
of energy savings and economic benefits
that would result from energy
conservation standards for small electric
motors, and prepared a report
describing its analysis. In June 2003, the
Department made the report ‘‘Analysis
of Energy Conservation Standards for
Small Electric Motors’’ available for
public comment on its Web site at
https://www.eere.energy.gov/buildings/
appliance_standards/commercial/
small_electric_motors.html. The report
made no recommendation concerning
the determination that the Department
should make.
The Department received comments
concerning its analysis of small motors
from NEMA, SMMA, and the American
Council for an Energy-Efficient
Economy (ACEEE). In general, the
comments received did not criticize
specific elements of the Department’s
technical analysis. The ACEEE comment
indicated that ACEEE found the analysis
to be ‘‘technically robust.’’ (ACEEE, No.
3 at p. 1) 2 However, NEMA asserted
that energy conservation standards for
certain small motors were not
2 A notation in the form ‘‘ACEEE, No. 3 at p. 1’’
identifies a written comment the Department has
received and has included in the docket of this
rulemaking. This particular notation refers to a
comment (1) by the American Council for an
Energy-Efficient Economy (ACEEE), (2) in
document number 3 in the docket of this
rulemaking (maintained in the Resource Room of
the Building Technologies Program), and (3)
appearing on page 1 of document number 3.
VerDate Aug<31>2005
17:09 Jul 07, 2006
Jkt 208001
economically justified and would harm
U.S. motor manufacturers, and ACEEE
claimed that energy conservation
standards for small motors are unlikely
to save much energy and would be a
diversion from exploring other energy
savings approaches. (NEMA, No. 1 at p.
2; ACEEE, No. 3 at p. 2) ACEEE
commented that the Department could
achieve greater energy savings if it did
not restrict its analysis to capacitor-start,
capacitor-run and capacitor-start,
induction-run single-phase motors, and
three-phase motors. ACEEE commented
that these categories of small motors
account for only four percent of
domestic shipments and that much
greater energy savings could be realized
by switching between different types of
small motors. (ACEEE, No. 3 at p. 1)
ACEEE suggested that the Department
encourage users of small motors to shift
between classes of motors, such as from
split-phase and shaded-pole motors to
capacitor-start, capacitor-run and
capacitor-start, induction-run motors; it
commented that the substitution would
yield greater savings than improvements
that are restricted to the category of
capacitor-start, induction-run motors.
Further, ACEEE suggested replacing
considered small motors with advanced
types, such as electronically
commutated permanent magnet motors.
(ACEEE, No. 3 at p. 1) While the
Department understands ACEEE’s
concern, the market transformation that
ACEEE suggests is outside the scope of
this determination since the purpose of
energy conservation standards is to
increase the energy performance of
regulated products rather than change
the product-purchase-and-use behavior
of consumers.
The SMMA generally supported the
findings of the NEMA/SMMA Working
Group. (SMMA, No. 2 at p. 1) The main
findings of the NEMA/SMMA Working
Group pertained to the cost-efficiency
relationship for small motors, and these
findings were incorporated into the
Department’s engineering analysis for
this determination.
NEMA commented that many small
motors are used in other equipment that
is subject to Federal energy conservation
standards, and that small motors in
those product applications are not
within the scope of the Department’s
analysis and proceeding. (NEMA, No. 1
at p. 1) The Department agrees with
NEMA, insofar as the EPCA definition
of small motors and exclusions
constrain the motors considered in the
Department’s analysis to a subset of the
total population of small electric
motors. As stated above, pursuant to
section 346(b)(3) of EPCA (42 U.S.C.
6317(b)(3)), the Department did not
PO 00000
Frm 00003
Fmt 4702
Sfmt 4702
38801
consider in its analysis motors that are
a component of a covered product or
equipment.
In a related comment, NEMA
requested that the Department designate
small motors as ‘‘covered equipment,’’
which it asserted was done for generalservice incandescent lamps although
there was no standard for such lamps,
and cited 59 FR 49468 (September 28,
1994). NEMA requested the designation
so that States that are attempting to set
efficiency standards for small motors
would be preempted by the Federal
action. (NEMA, No. 1 at p. 1) Section
345(a) of EPCA (42 U.S.C. 6316(a))
provides in part that section 327 of the
Act (42 U.S.C. 6297), which addresses
preemption of State energy conversation
requirements by EPCA, shall apply to
various equipment covered by part C of
title III of EPCA, which includes small
electric motors. Thus, State energy use
and efficiency requirements for ‘‘small
electric motors,’’ as defined in 42 U.S.C.
6311(13)(F), are already preempted to
the extent provided in section 327 of
EPCA (42 U.S.C. 6297). No further
action by DOE is needed to provide for
such preemption. Small motors that are
not within EPCA’s definition of small
motors are not covered by EPCA;
therefore, the Act does not preempt
State energy use and efficiency
requirements with respect to motors not
covered by EPCA.
II. Discussion of the Analysis of Small
Motors
A. Purpose and Content
The Department performed an
analysis of the feasibility of achieving
significant energy savings as a result of
energy conservation standards for
considered small electric motors. The
Department presents the results of this
analysis in a technical support
document (TSD) for this determination.
In subsequent analyses for the standards
ANOPR, NOPR, and final rule, DOE will
perform the more robust analyses
required by EPCA. These analyses will
involve more precise and detailed
information that the Department will
develop and receive during the
standards rulemaking process, and will
detail the effects of proposed energy
conservation standards for small electric
motors.
B. Methodology
To address EPCA requirements that
DOE determine whether energy
conservation standards for small motors
would be technologically feasible and
economically justified, and result in
significant energy savings (42 U.S.C.
6317(b)(1)), the Department’s analysis
E:\FR\FM\10JYP1.SGM
10JYP1
38802
Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 / Proposed Rules
jlentini on PROD1PC65 with PROPOSAL
consisted of five major elements: (1)
Market research to better understand
where and how small motors are used,
(2) engineering analysis to estimate how
different design options affect efficiency
and cost, (3) life-cycle cost (LCC)
analysis to estimate the costs and
benefits to users from increased
efficiency in small motors, (4) national
energy savings analysis to estimate the
potential energy savings on a national
scale, and (5) national consumer
impacts analysis to estimate potential
economic costs and benefits that would
result from improving energy efficiency
in the considered small motors. The
following is a brief description of each
element.
1. Market Research
The Department conducted research
on the market for considered small
motors, including annual shipments, the
current range of energy efficiencies,
motor applications and utilization,
market structure, and distribution
channels. It used information from
original equipment manufacturers
(OEMs), trade associations that support
industrial sectors, consultation with
small motor manufacturers, and
independent experts. Also, NEMA
provided data, on its own initiative, to
the Department on sales of two-digitframe small motors to domestic
customers by its member manufacturers,
covering the period from 1971 to 2001.
Based on its market research, the
Department estimated that, on average,
capacitor-start and three-phase small
motors are used 2,500 hours annually at
a loading of 70 percent of rating.
Based on its market research,
including input from OEMs that
incorporate small motors into their
products and the NEMA/SMMA
Working Group, the Department used
seven years as the mean lifetime for
capacitor-start motors, and nine years
for three-phase motors.
Also based on its market research, the
Department determined that the small
motors considered in this determination
are used in commercial and industrial
settings with the corresponding tariffs.
The Department estimated that
approximately three-fourths of
capacitor-start motors are used by utility
customers on a commercial tariff, while
virtually all users of small, three-phase
motors are on an industrial tariff.
Industrial electricity prices tend to be
lower than commercial prices.
2. Engineering Analysis
In the engineering analysis, the
Department examined methods for
increasing energy efficiency that
included increasing the amount of
VerDate Aug<31>2005
17:09 Jul 07, 2006
Jkt 208001
active material (e.g., the diameter of
wire conductors), substituting a higher
grade of steel for the magnetic
components, improving the mechanical
components and design (winding,
bearings, and fan), and improving the
quality control of components and
assembly. Manufacturers of small
motors use all of these methods of
motor-efficiency improvement in their
design and production processes. In
general, the Department found that
these methods may increase either the
motor cost or size if there are no other
changes in the motor-design parameters.
In particular, the Department evaluated
several ways to achieve increased
efficiency, including (1) changing the
quality of the grade of electrical steel,
(2) changing the quantity of electrical
steel (stack length), and (3) changing the
magnetic flux density by adjusting the
effective turns in the copper windings
and/or changing the thickness of the
steel laminations in the core of a small
motor. In its preliminary engineering
evaluation, the Department found the
efficiency improvement method of
changing flux density to be the most
expensive of the three methods. As a
result, the Department analyzed only
the two lower-cost efficiency
improvement methods to help maintain
the simplicity and clarity of its analysis.
In particular, the Department
examined a one-half-horsepower,
capacitor-start, induction-run motor and
a one-horsepower, three-phase motor as
prototypes for improving the energy
efficiency of small motors. To estimate
the efficiency changes and additional
costs resulting from design changes, the
Department used two sets of data. The
Department derived the first set by
engaging an independent motor
industry expert to estimate motorefficiency costs from motor test data and
design cost estimates. The expert
obtained motor test data for a sample of
small motors using a traditional motor
performance program based on
equivalent-circuit analysis to calculate
efficiency changes resulting from
changes in steel grades and stack
lengths. This methodology was similar
to methods commonly used by motor
manufacturers. The NEMA/SMMA
Working Group provided, on its own
initiative, a comparable set of data in an
aggregated form.
The Department had a concern that
the cost-efficiency curves presented in
the June 2003 report ‘‘Analysis of
Energy Conservation Standards for
Small Electric Motors’’ were based on
2001 materials pricing data, which
represented a relative low-price point
for many electrical steels (i.e., the steel
used for building electric motor rotors
PO 00000
Frm 00004
Fmt 4702
Sfmt 4702
and stators). The price of electrical
steels has increased since 2001.
However, the slope of the engineering
analysis cost-efficiency curves depends
on the price difference between the
baseline unit (i.e., low efficiency steel)
and the higher efficiency unit (i.e.,
better grade steel). Electrical steel price
data collected in 2005 for the
distribution transformer standards
rulemaking along with a check of 2001
and 2005 pricing for specific steels used
in small motors verified that the price
differential between the baseline and
high-efficiency steels did not increase
between 2001 and 2005. For this reason,
the Department determined that it was
not necessary to update the material
prices for the engineering analysis,
because updating the material prices, or
calculating average material prices
representative of a multi-year period,
would not significantly change the
Department’s engineering results.
3. Life-Cycle Cost Analysis
Based on its engineering analysis of
the available technical data, the
Department conducted a life-cycle cost
(LCC) analysis to estimate the net
benefit to users from increased
efficiency in capacitor-start and threephase small motors. The LCC analysis
compared the additional up-front cost of
a higher-efficiency motor to the
discounted value of electricity savings
over the life of the motor. The
Department’s LCC analysis used the
following inputs: estimated average
motor use in terms of hours and loading
and typical motor lifetime (discussed
above), estimated average prices for base
motors and more-efficient motors,
average electricity prices paid by users
of capacitor-start and three-phase small
motors, and the discount rate.
The Department received significant
comment regarding its estimates of
motor lifetimes. The Department
understands that the typical lifetime of
a small motor is not well documented.
Most industry experts with whom the
Department consulted suggested the
average life for considered motors is at
most ten years, depending on the use
and physical environment. The NEMA/
SMMA Working Group estimated an
average life of five years for a capacitorstart motor and ten years for a threephase motor. In view of these
considerations, the Department
estimated the mean lifetime for a
capacitor-start motor at seven years and
a three-phase motor at nine years.
Moreover, the Department believes that
the potential lifetime of a considered
motor may be greater than that of the
driven equipment. Thus, the actual
motor lifetime may be limited by the
E:\FR\FM\10JYP1.SGM
10JYP1
jlentini on PROD1PC65 with PROPOSAL
Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 / Proposed Rules
lifetime of the equipment it drives. In
view of this issue, NEMA commented
that the economic justification of energy
conservation standards for the user was
not good. Where simple payback
periods range from 4.9 to 9 years, NEMA
questioned whether the equipment
driven by the small motor will last that
long and, thus, enable the payback for
the higher cost of improved efficiency to
be realized. (NEMA, No. 1 at p. 2).
The Department acknowledges that a
small motor’s lifetime could be limited
by the life of the equipment it drives.
The Department used a distribution of
lifetimes for small electric motors in its
analysis. For capacitor-start motors, the
analysis used the range of 5 to 9 years
for the lifetime, and for polyphase
motors the Department used a range of
7 to 11 years. Given existing data and
the balance of diverse stakeholder and
expert comments, the Department
considers its current lifetime estimates
to be reasonable and accurate for this
determination analysis.
The Department estimated the base
purchase price of typical capacitor-start
and three-phase small motors using (1)
prices listed in the 2001–2002 W.W.
Grainger, Inc., catalog, (2) estimates of
the percentage of the list price paid in
different motor distribution channels,
and (3) estimates of the distribution of
sales among the three channels (motor
manufacturer to OEM, motor
manufacturer to distributor to original
equipment manufacturer, and motor
manufacturer to distributor to end user).
The Department derived the price for a
motor that incorporated design changes
to improve efficiency by applying the
estimated percentage of incremental
cost from the engineering analysis to the
average base price of the motor
estimated from the Grainger, Inc.,
catalog.
The Department estimated average
commercial and industrial electricity
prices using the 2010 and 2020 forecasts
from the Energy Information
Administration’s (EIA) Annual Energy
Outlook 2006. It then derived average
prices paid by users of capacitor-start
and three-phase small motors based on
the tariff classes of users (discussed
above). Given that relatively small
industrial establishments use
considered small, polyphase (i.e., threephase) motors more than larger
establishments, and that small
industrial establishments have higher
electricity tariffs than larger industry,
the Department estimated the electricity
price for polyphase motors as five
percent higher than the national average
industrial price of electricity.
The Department derived a discount
rate based on the weighted-average cost
VerDate Aug<31>2005
17:09 Jul 07, 2006
Jkt 208001
of capital for representative companies
using products containing the
considered small motors. After
deducting for expected inflation, the
Department estimated the average cost
of capital for considered small motor
owners as 7.5 percent.
4. National Energy Savings Analysis
To estimate national energy savings
for small motors sold from 2010 through
2030, the Department calculated the
energy consumption of two typical sizes
of small motors: One-half horsepower,
capacitor-start, induction-run motors,
and one-horsepower, three-phase
motors. The Department used both its
own data and the NEMA/SMMA
Working Group data for capacitor-start,
induction-run motors. However, it used
only its own data for three-phase motors
because the NEMA/SMMA Working
Group based its analysis on a one-half
horsepower motor, which is less
common than the one-horsepower
motor, and which therefore has losses
that may not be representative of
considered small, three-phase motors.
The Department calculated the energy
efficiencies of small motors with
improved-steel-grade and increasedstack-length design options, and
extrapolated the results to a national
average for all new capacitor-start,
induction-run and three-phase motors
(constituting the energy conservation
standards cases).
The Department estimated the energy
savings of the standards cases relative to
two base cases—little improvement and
moderate improvement in efficiency—in
the absence of any standards. The
Department formulated each base case
using information from historical
trends, and input from the NEMA/
SMMA Working Group, provided on its
own initiative. The Department also
evaluated two small-motors-shipments
scenarios, estimating national energy
savings for average annual growth in
shipments of 1 percent and 1.5 percent.
These shipments scenarios are also
based upon historical trends and input
from the NEMA/SMMA Working Group.
To estimate potential energy savings
from a possible energy conservation
standard, the Department used an
accounting model that calculated total
end-use electricity savings in each year
of a 35-year forecast. The model
featured a product-retirement function
to calculate the number of units sold in
a given year, or vintage, which would
still be in operation in future years.
Some of the small motors sold in 2030
will operate through 2040. The
retirement function assumed that
individual motor lifetime is evenly
PO 00000
Frm 00005
Fmt 4702
Sfmt 4702
38803
distributed in a five-year interval
around the mean lifetime.
The Department calculated primary
energy savings associated with end-use
electricity savings using data from EIA’s
Annual Energy Outlook 2006 (AEO).
These data provided an average
multiplier for relating end-use
electricity to primary energy use (energy
consumption by the power plant) for
each year from 2010 to 2020. The
Department extrapolated the trend in
these years to derive factors for 2021 to
2040.
5. National Consumer Impacts Analysis
The Department estimated national
economic impacts on end users in terms
of the net present value (NPV) of
cumulative benefits from 2010 to 2040.
It considered these impacts under the
same range of scenarios as it did for
estimating national energy savings. It
used the incremental equipment costs
and energy savings for each energyefficiency level that it applied in the
LCC analysis. To simplify the analysis,
the Department estimated the value of
energy savings using the average AEO
forecast electricity price from 2010 to
2020. The Department discounted future
costs and benefits by using a sevenpercent discount rate, according to the
‘‘Guidelines and Discount Rates for
Benefit Analysis of Federal Programs,’’
issued by the Office of Management and
Budget in 1992 (Circular No. A–94,
Revised).
C. Analysis Results
1. Engineering Analysis
As described above, the Department
conducted separate analyses of changes
in the grade of electrical steel and a
change in the stack length to improve
the energy efficiency of small motors. In
each case, the Department gave the base
motor a ‘‘per-unit’’ cost of one. The
Department related all design-option
changes to the base motor per-unit cost
of one. For example, if a change in
electrical steel created a 10 percent
change in the cost of materials, such as
electrical steel, the Department assigned
the per-unit number of 1.10 for the new
design. In addition, the NEMA/SMMA
Working Group provided, on its own
initiative, comparable data, where each
of four manufacturers selected a typical
small motor to use as the base motor.
For steel-grade design options, the
NEMA data refer to the average values
of the four manufacturers. For stackchange design options, the NEMA/
SMMA Working Group provided data
that it considered most typical. Tables 1
and 2 summarize the results of the
analysis of steel-grade and stack-length
E:\FR\FM\10JYP1.SGM
10JYP1
38804
Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 / Proposed Rules
changes. For capacitor-start motors, the
Department analyzed the cost of
efficiency improvements for both 56frame and 48-frame motors. These two
frames represent distinct frame sizes
that are common for one-half
horsepower motors.
Overall, the Department’s analysis
and the NEMA/SMMA Working Group
data were more comparable for the
stack-change design options than they
were for the design options related to
steel-grade changes. The NEMA/SMMA
Working Group estimated a much
smaller efficiency improvement due to
steel grade improvements than the
Department’s analysis.
TABLE 1.—CAPACITOR-START MOTORS, 1⁄2 HORSEPOWER, 4-POLE, OPEN DRIP-PROOF
Grade A
Grade B
Grade B+
M47
Steel-Grade Design Options
DOE Analysis, 56-Frame:
Per-unit Cost .............................................................................................
Efficiency ..................................................................................................
DOE analysis, 48-Frame:
Per-unit Cost .............................................................................................
Efficiency ..................................................................................................
1.00
53.9%
1.03
57.4%
1.08
59.3%
1.25
60.5%
1.00
62.6%
1.03
65.4%
1.10
66.8%
1.25
69.0%
Grade 1
NEMA/SMMA data:
Per-unit Cost .........................................................................................................................
Efficiency ..............................................................................................................................
Base
1.00
60.0%
Plus stack
Grade 2
1.10
61.7%
Plus 2 stack
Grade 3
1.21
62.9%
Plus 3 stack
Stack-Change Design Options
DOE analysis, 56-Frame:
Per-unit Cost .............................................................................................
Efficiency ..................................................................................................
DOE analysis, 48-Frame:.
Per-unit Cost .............................................................................................
Efficiency ..................................................................................................
NEMA/SMMA data:
Per-unit Cost .............................................................................................
Efficiency ..................................................................................................
1.00
53.9%
1.09
58.1%
1.19
60.3%
1.29
62.0%
1.00
62.6%
1.07
63.5%
1.15
64.4%
1.22
65.1%
1.00
62.0%
1.10
64.3%
1.20
65.5%
1.30
66.5%
TABLE 2.—POLYPHASE MOTORS, 4-POLE, OPEN DRIP-PROOF
Grade A+
Grade B+
M47
Steel-Grade Design Options
DOE analysis, 1 horsepower:
Per-unit Cost .........................................................................................................................
Efficiency ..............................................................................................................................
1.0
76.4%
Grade 1
NEMA/SMMA data, 1⁄2 horsepower:
Per-unit Cost .........................................................................................................................
Efficiency ..............................................................................................................................
Base
1.00
68.1%
Plus stack
1.04
78.3%
Grade 2
1.10
70.7%
Plus 2 stack
1.20
81.2%
Grade 3
1.20
72.1%
Plus 3 stack
Stack-Change Design Options
jlentini on PROD1PC65 with PROPOSAL
DOE analysis, 1 horsepower:
Per-unit Cost .............................................................................................
Efficiency ..................................................................................................
NEMA/SMMA analysis, 1⁄2 horsepower:
Per-unit Cost .............................................................................................
Efficiency ..................................................................................................
As stated above, the Department
received no comments criticizing
specific elements of its technical
analysis. NEMA agreed with the
Department’s conclusions that it is
technically feasible to increase the
VerDate Aug<31>2005
17:09 Jul 07, 2006
Jkt 208001
1.00
76.4%
1.06
77.2%
1.18
78.9%
1.24
79.2%
1.00
72.2%
1.08
73.1%
1.16
73.9%
1.24
74.1%
efficiency of small motors in frame sizes
42, 48, and 56 for three-phase and
single-phase motors, and that improving
grades of steel and redesigning
laminations will provide increased
efficiency, but at much higher capital
PO 00000
Frm 00006
Fmt 4702
Sfmt 4702
costs. (NEMA, No. 1 at p. 2) ACEEE
found the Department’s analysis to be
‘‘technically robust.’’ (ACEEE, No. 3 at
p. 1).
NEMA commented that manufacturer
costs and impacts from a possible
E:\FR\FM\10JYP1.SGM
10JYP1
38805
Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 / Proposed Rules
standard may be high. It asserted that
there will be high capital costs and,
presumably, less economic benefit to
the manufacturer than the Department
described in its June 2003 determination
report ‘‘Analysis of Energy Conservation
Standards for Small Electric Motors.’’
(NEMA, No. 1 at p. 2) While the
economic impacts of a possible standard
on manufacturers may be substantial,
DOE did not evaluate the full impact of
possible standards on manufacturers in
this determination. The Department
instead used the presence of highefficiency designs in the marketplace as
an indicator of the probable economic
feasibility of manufacturing high
efficiency designs. The Department will
address detailed economic impacts on
manufacturers at such time that it
conducts a manufacturer impact
analysis for an energy efficiency
standards rulemaking.
In addition, NEMA commented that
there was a strong likelihood that OEMs
will switch to alternative small motors
that are not covered to avoid any added
costs resulting from energy conservation
standards. (NEMA, No. 1 at p. 2) The
Department believes that shifting from,
for example, a capacitor-start,
induction-run small motor to a less
efficient shaded-pole or split-phase
small motor design would reduce
potential energy savings. However, the
Department understands that small
motors are not generally
interchangeable. Physical constraints in
some current equipment designs may
preclude the substitution of another
type of motor for a considered small
motor. Lacking clear evidence or data
regarding the change in sales of
considered small motors due to possible
standards, the Department did not
model this potential phenomenon in the
determination analysis. (As explained
below, the Department intends to
undertake a rulemaking to develop
standards for small motors. If it appears
to DOE in the initial phases of the
rulemaking that the potential for motor
switching warrants further examination,
the Department will address that issue
in its analyses during the rulemaking.)
2. Life-Cycle Cost and Payback Period
Analysis
The Department presents key results
for capacitor-start motors in Tables 3
and 4 below. Using the DOE data for
capacitor-start motors, the steel-grade
options all have lower LCC than the
base motor. However, results using the
NEMA/SMMA average data show an
increase in LCC at steel grade 3, with no
change in LCC at steel grade 2. The DOE
analysis shows the stack-length options
increasing the LCC, while the NEMA/
SMMA results show a slight decrease
for the first option, but then an increase
in LCC for the higher-efficiency stack
change options.
TABLE 3.—IMPACTS OF EFFICIENCY IMPROVEMENT ON TYPICAL END USER, CAPACITOR-START, 1⁄2 HORSEPOWER, DOE
DATA*
Steel grade
Grade A
(base)
Motor Price-Buyer ** .................................
Annual Operating Cost ............................
Life-Cycle Cost (7.5% DR) ......................
Change in LCC (WRT Base) ...................
Percent Change in LCC ...........................
Payback Period (years) ...........................
Grade B
$103
$75
$501
....................
....................
....................
$106
$72
$487
¥$14.07
¥2.8%
1.0
Stack change
Grade B+
$114
$70
$486
¥$14.47
¥2.9%
2.2
M47
Plus stack
$129
$68
$490
¥$11.37
¥2.3%
3.7
Plus 2 stack
Plus 3 stack
$119
$73
$505
$4.05
0.8%
7.2
$126
$72
$508
$7.47
1.5%
7.9
$111
$74
$502
$1.51
0.3%
6.7
* Data refer to a specific typical motor.
** Based on actual motor price in Grainger catalog.
TABLE 4.—IMPACTS OF EFFICIENCY IMPROVEMENT ON TYPICAL END USER, CAPACITOR-START, 1⁄2 HORSEPOWER, NEMA/
SMMA DATA
Steel grade *
Grade 1
(base)
Motor Price-Buyer *** ...............................
Annual Operating Cost ............................
Life-Cycle Cost (7.5% DR) ......................
Change in LCC (WRT Base) ...................
Percent Change in LCC ...........................
Payback Period (years) ...........................
Grade 2
$117
$78
$532
....................
....................
....................
$128
$76
$532
¥$0.01
0.0%
5.3
Stack change **
Grade 3
$141
$75
$537
$5.20
1.0%
6.7
Base
Plus stack
$117
$76
$518
....................
....................
....................
$128
$73
$516
¥$2.63
¥0.5%
4.3
Plus 2 stack
Plus 3 stack
$140
$72
$520
$1.41
0.3%
5.6
$152
$71
$526
$7.36
1.4%
6.7
jlentini on PROD1PC65 with PROPOSAL
* Data are average of four manufacturers.
** Data reflect costs and performance of a typical motor.
*** Estimated by DOE based on Grainger catalog prices.
Tables 5 and 6 present results for
small, polyphase motors. Although the
base motors are different in the DOE and
NEMA/SMMA data sets, it is the
relative change for each motor that is of
most interest. Using the DOE data, the
VerDate Aug<31>2005
17:09 Jul 07, 2006
Jkt 208001
steel-grade options both have lower LCC
than the base motor. However, results
based on the NEMA/SMMA average
data show an increase in LCC at steel
grade 3, with the LCC at steel grade 2
being equivalent to that for the base
PO 00000
Frm 00007
Fmt 4702
Sfmt 4702
motor. Using the DOE data, the stacklength options moderately increase the
LCC relative to the base motor, while
the increase in LCC is more pronounced
in the results based on the NEMA/
SMMA data.
E:\FR\FM\10JYP1.SGM
10JYP1
38806
Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 / Proposed Rules
TABLE 5.—IMPACTS OF EFFICIENCY IMPROVEMENT ON TYPICAL END USER, POLYPHASE 1 HORSEPOWER, DOE DATA*
Steel grade
Grade A
(base)
Motor Price-Buyer ** .........................................................
Annual Operating Cost ....................................................
Life-Cycle Cost (7.5% DR) ..............................................
Change in LCC (WRT Base) ...........................................
Percent Change in LCC ...................................................
Payback Period (years) ...................................................
Stack change
Grade B+
$119
$98
$746
....................
....................
....................
M47
$124
$96
$736
¥$10.49
¥1.4%
2.0
Plus stack
$143
$93
$733
¥$12.98
¥1.7%
4.1
Plus 2 stack
$126
$97
$747
$0.86
0.1%
7.3
$140
$95
$748
$1.69
0.2%
6.9
Plus 3
Stack
$148
$95
$752
$6.14
0.8%
8.1
* Data refer to a specific typical motor.
** Based on actual motor price in Grainger catalog.
TABLE 6.—IMPACTS OF EFFICIENCY IMPROVEMENT ON TYPICAL END USER, POLYPHASE 1⁄2 HORSEPOWER, NEMA/SMMA
DATA
Steel grade *
Grade 1
(base)
Motor Price-Buyer *** ...............................
Annual Operating Cost ............................
Life-Cycle Cost (7.5% DR) ......................
Change in LCC (WRT Base) ...................
Percent Change in LCC ...........................
Payback Period (years) ...........................
Grade 2
$125
53.9
469
....................
....................
....................
Stack change **
Grade 3
$138
$51.9
$469
¥$0.02
0.0%
6.4
Base
$151
$50.9
$475
$6.02
1.3%
8.4
Plus stack
$126
$50.8
$450
....................
....................
....................
Plus 2 stack
Plus 3 stack
$146
$49.7
$463
$12.96
2.9%
17.9
$156
$49.5
$472
$22.14
4.9%
23.9
$136
$50.2
$456
$6.48
1.4%
17.9
* Data are average of four manufacturers.
** Data reflect costs and performance of a typical motor.
*** Estimated by DOE based on Grainger catalog prices.
3. National Energy Savings and
Consumer Impacts
The Department estimated national
energy savings and consumer impacts of
energy conservation standards for the
considered small motors using its own
engineering analysis data and the
NEMA/SMMA Working Group data.
The Department assumed that energy
conservation standards would take
effect in 2010, and estimated cumulative
energy savings and NPV impacts
relative to alternative base cases.
The results using the Department’s
analysis of design options indicate
cumulative energy savings for capacitorstart, induction run-small motors
ranging from 0.47 to 0.59 quad (see table
7). The corresponding NPV ranges from
$0.28 to $0.35 billion. The results based
on the data provided by the NEMA/
SMMA Working Group, on its own
initiative, show lower energy savings
and economic benefits.
The results using the Department’s
analysis of design options for threephase small motors indicate cumulative
energy savings from 0.14 to 0.19 quad
(see table 8). The corresponding NPV
ranges from $0.08 to $0.11 billion. For
the three-phase motors, the Department
did not estimate national impacts using
the data provided by the NEMA/SMMA
Working Group, on its own initiative,
because these data were based on a onehalf horsepower motor instead of the
more typical one-half horsepower size.
The NEMA/SMMA data for halfhorsepower motors show some
efficiency gains, but with an increase in
LCC, which would lead to a negative
NPV.
TABLE 7.—CUMULATIVE ENERGY AND CONSUMER IMPACTS OF ENERGY EFFICIENCY IMPROVEMENT FOR 1⁄2 HORSEPOWER
CAPACITOR START-INDUCTION-RUN MOTORS PROJECTED TO BE SOLD IN THE 2010–2030 PERIOD *
Energy savings
(quads)
NPV
(year 2005 dollars in billions,
discounted at 7 percent to
2005)
Future scenario
DOE
NEMA/SMMA
DOE
jlentini on PROD1PC65 with PROPOSAL
Low-efficiency-gain base case, low shipments growth ...................................
Low-efficiency-gain base case, high shipments growth ..................................
Moderate-efficiency-gain base case, low shipments growth ...........................
Moderate-efficiency-gain base case, high shipments growth .........................
0.54
0.59
0.47
0.51
0.19
0.21
0.12
0.12
NEMA/ SMMA
0.33
0.35
0.28
0.30
0.04
0.04
¥0.05
¥0.05
* The values given for each scenario correspond to the design option with the combination of highest energy savings and most favorable consumer NPV.
VerDate Aug<31>2005
17:09 Jul 07, 2006
Jkt 208001
PO 00000
Frm 00008
Fmt 4702
Sfmt 4702
E:\FR\FM\10JYP1.SGM
10JYP1
38807
Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 / Proposed Rules
TABLE 8.—CUMULATIVE ENERGY AND CONSUMER IMPACTS OF ENERGY EFFICIENCY IMPROVEMENT FOR ONEHORSEPOWER THREE-PHASE MOTORS PROJECTED TO BE SOLD IN THE 2010–2030 PERIOD *
Energy savings
(quads)
NPV
(year 2005 dollars in billions,
discounted at 7 percent to
2005)
Future scenario
DOE
NEMA/ SMMA
DOE
Low-efficiency-gain base case, low shipments growth ...................................
Low-efficiency-gain base case, high shipments growth ..................................
Moderate-efficiency-gain base case, low shipments growth ...........................
Moderate-efficiency-gain base case, high shipments growth .........................
(1)
(1)
(1)
(1)
0.17
0.19
0.14
0.15
NEMA/ SMMA
0.10
0.11
0.08
0.09
(1 )
(1 )
(1 )
1
* The values given for each scenario correspond to the design option with the combination of highest energy savings and most favorable consumer NPV.
1 Not available.
The differences between the results
using the Department’s analysis of
design options and those using the data
that the NEMA/SMMA Working Group
provided on its own initiative reflect
differences in estimates of the efficiency
and cost increases associated with
different design options.
jlentini on PROD1PC65 with PROPOSAL
D. Discussion
1. Significance of Energy Savings
Section 346(b)(1) of EPCA (42 U.S.C.
6317(b)(1)) mandates the Department to
determine whether energy conservation
standards for small motors would result
in ‘‘significant energy savings.’’ NEMA
commented that energy conservation
standards for the considered small
motors are not likely to save the
threshold amount of one quad. (NEMA,
No. 1 at p. 1) While the term
‘‘significant’’ is not defined in the Act,
the U.S. Court of Appeals, in Natural
Resources Defense Council v.
Herrington, 768 F.2d 1355, 1373 (D.C.
Cir. 1985), indicated that Congress
intended ‘‘significant’’ energy savings in
a similar context in section 325 of the
Act (42 U.S.C. 6295(o)(3)(B)) to be
savings that were not ‘‘genuinely
trivial.’’ Using the Department’s analysis
of design options, the estimated energy
savings of 0.61 to 0.78 quad over a 20year period for the considered small
motors are comparable to those the
Department found to be significant for
room air conditioners, where energy
savings projected to result from
standards ranged from 0.36 to 0.96 quad
over a 30-year period. 62 FR 50122,
50142 (September 24, 1997). The
Department believes that the estimated
energy savings for the considered small
motors are not ‘‘genuinely trivial,’’ and
are, in fact, ‘‘significant.’’
2. Impact on Consumers
Section 346(b)(1) of EPCA requires
that energy conservation standards for
small motors be economically justified
(42 U.S.C. 6317(b)(1)). Using the
VerDate Aug<31>2005
17:09 Jul 07, 2006
Jkt 208001
methods and data described in section
II.B., the Department conducted an LCC
analysis to estimate the net benefits to
users from increased efficiency in the
considered small motors. The
Department then aggregated the results
from the LCC analysis to the national
level to estimate national energy savings
and national economic impacts. Given
the results on energy savings and
economic benefits, the Department
concluded that there is also likely to be
reduced emissions from decreased
electricity generation, decreased
demand for the construction of
electricity power plants, and potentially
net indirect employment benefits from
shifting expenditures from the capitalintensive utility sector to consumer
expenditures. While the Department did
not quantify these potential benefits, it
concluded that the benefits are likely to
be positive based on the results of the
Department’s analyses regarding energy
conservation standards for similar
products. The Department will provide
detailed estimates of such impacts as
part of the standards rulemaking process
that will result from this determination.
III. Conclusion
A. Determination
Based on its analysis of the
information now available, the
Department has determined that energy
conservation standards for certain small
electric motors appear to be
technologically feasible and
economically justified, and are likely to
result in significant energy savings.
Consequently, the Department will
initiate the development of energyefficiency test procedures and standards
for certain small electric motors.
All design options addressed in
today’s determination notice are
technologically feasible. The
Department’s data, and data submitted
by manufacturers, on their own
initiative, show that the considered
technologies are available to all
PO 00000
Frm 00009
Fmt 4702
Sfmt 4702
manufacturers. These technologies
include increased use of higher-grade
steel, and greater amounts of electrical
steel. The machinery and tools used to
produce more-energy-efficient small
motors are generally available to
manufacturers.
The scenarios examined in the
Department’s analysis show that there is
potential for significant energy savings.
The combined savings for capacitor-start
and polyphase motors range from 0.61
to 0.78 quad using DOE’s data. They are
lower using the NEMA/SMMA data.
For the considered capacitor-start,
induction-run motors and using the
DOE engineering data, all of the
scenarios evaluated would result in
economic benefits to the Nation as
shown by the positive NPV. For the
same motors, using the NEMA/SMMA
data, three of the four scenarios
evaluated have positive NPV. For the
considered three-phase motors and
using the DOE engineering data, all of
the scenarios evaluated have positive
NPV for at least one design option
(national NPV was not calculated for
three-phase motors based upon the
NEMA/SMMA engineering data,
because the data provided were for an
unrepresentative size). While it is still
uncertain whether further analyses will
confirm these findings, the Department
believes that standards for considered
small motors appear economically
justified based on balanced
consideration of the information and
analysis available to the Department at
this time.
The Department has not produced
detailed estimates of the potential
adverse impacts of a national standard
on manufacturers or on individual
categories of users. The Department is
instead relying on the presence of highefficiency designs in the market place
today as an indicator of the probable
economic feasibility for manufacturers
to exclusively produce high-efficiency
designs if required by standards. During
E:\FR\FM\10JYP1.SGM
10JYP1
38808
Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 / Proposed Rules
the course of the standards rulemaking
process, the Department will perform a
detailed analysis of the impact of
possible standards on manufacturers, as
well as a more disaggregated assessment
of their possible impacts on usersubgroups.
B. Future Proceedings
The Department will begin, therefore,
the process of establishing testing
requirements for small electric motors,
which it expects will result in the
publication of a proposed rule. During
the rulemaking process, the Department
will consider the Institute of Electrical
and Electronics Engineers (IEEE)
Standard 114–2001, Test Procedures for
Single-Phase Induction Motors.
The Department also will begin a
proceeding to consider establishment of
energy conservation standards for small
electric motors. Throughout the
rulemaking process, the Department
intends to adhere to the provisions of
the Process Rule, where applicable.
During the standards rulemaking, the
Department will review and analyze the
likely effects of industry-wide voluntary
programs, such as ENERGY STAR and
NEMA Premium. In addition, any
efforts by NEMA and SMMA to
strengthen their efforts to promote
voluntary standards for small motors
will be considered. The Department will
collect additional information about
design options, inputs to the
engineering and LCC analyses, and
potential impacts on the manufacturers
and consumers of small motors. During
the standards rulemaking process, the
Department will evaluate whether
standards are technologically feasible
and economically justified, and are
likely to result in significant energy
savings in accordance with the
requirements of EPCA. (42 U.S.C.
6295(o)) If further analyses reveal that
standards are not warranted, DOE will
revise this determination and will not
proceed to promulgate standards.
Issued in Washington, DC, on June 27,
2006.
Alexander A. Karsner,
Assistant Secretary, Energy Efficiency and
Renewable Energy.
[FR Doc. E6–10437 Filed 7–7–06; 8:45 am]
jlentini on PROD1PC65 with PROPOSAL
BILLING CODE 6450–01–P
VerDate Aug<31>2005
17:09 Jul 07, 2006
Jkt 208001
DEPARTMENT OF COMMERCE
Patent and Trademark Office
37 CFR Part 1
[Docket No.: PTO–P–2005–0024]
RIN 0651–AB95
Changes To Information Disclosure
Statement Requirements and Other
Related Matters
United States Patent and
Trademark Office, Commerce.
ACTION: Notice of proposed rulemaking.
AGENCY:
SUMMARY: The United States Patent and
Trademark Office (Office) is proposing
changes to information disclosure
statement (IDS) requirements and other
related matters to improve the quality
and efficiency of the examination
process. The proposed changes will
enable the examiner to focus on the
relevant portions of submitted
information at the very beginning of the
examination process, give higher quality
first actions, and minimize wasted
steps. The Office is proposing the
following changes relating to
submissions of IDSs by applicants/
patent owners: Before a first Office
action on the merits, require additional
disclosure for English language
documents over twenty-five pages, for
any foreign language documents, or if
more than twenty documents are
submitted, but documents submitted in
reply to a requirement for information
or resulting from a foreign search or
examination report would not count
towards the twenty document limit;
permit the filing of an IDS after a first
Office action on the merits only if
certain additional disclosure
requirements have been met; and
eliminate the fees for submitting an IDS.
Updates to the additional disclosure
requirements would be required as
needed for every substantive
amendment. The Office is also
proposing to revise the protest rule to
better set forth options that applicants
have for dealing with unsolicited
information received from third parties.
DATES: To be ensured of consideration,
written comments must be received on
or before September 8, 2006. No public
hearing will be held.
ADDRESSES: Comments should be sent
by electronic mail over the Internet
addressed to:
AB95.comments@uspto.gov. Comments
may also be submitted by mail
addressed to: Mail Stop CommentsPatents, Commissioner for Patents, P.O.
Box 1450, Alexandria, VA 22313–1450;
or by facsimile to (571) 273–7707,
PO 00000
Frm 00010
Fmt 4702
Sfmt 4702
marked to the attention of Hiram H.
Bernstein. Although comments may be
submitted by mail or facsimile, the
Office prefers to receive comments via
the Internet.
Comments may also be sent by
electronic mail message over the
Internet via the Federal eRulemaking
Portal. See the Federal eRulemaking
Portal Web site (https://
www.regulations.gov) for additional
instructions on providing comments via
the Federal eRulemaking Portal.
The comments will be available for
public inspection at the Office of Patent
Legal Administration, Office of the
Deputy Commissioner for Patent
Examination Policy, currently located at
Room 7D74 of Madison West, 600
Dulany Street, Alexandria, Virginia, and
will be available through anonymous
file transfer protocol (ftp) via the
Internet (address: https://
www.uspto.gov). Because comments will
be made available for public inspection,
information that is not desired to be
made public, such as an address or
phone number, should not be included
in the comments.
FOR FURTHER INFORMATION CONTACT:
Hiram H. Bernstein ((571) 272–7707),
Senior Legal Advisor, Office of Patent
Legal Administration, Office of the
Deputy Commissioner for Patent
Examination Policy; or Robert J. Spar
((571) 272–7700), Director of the Office
of Patent Legal Administration, Office of
the Deputy Commissioner for Patent
Examination Policy, directly by phone,
or by facsimile to (571) 273–7707, or by
mail addressed to: Mail Stop CommentsPatents, Commissioner for Patents, P.O.
Box 1450, Alexandria, VA 22313–1450.
SUPPLEMENTARY INFORMATION: The Office
is proposing changes to the rules of
practice in title 37 of the Code of
Federal Regulations (CFR) to revise IDS
practice. The Office is specifically
proposing changes to §§ 1.17, 1.48, 1.55,
1.56, 1.97, 1.98, 1.99 1.291, 1.312, 1.555,
and 1.948.
The Office will post a copy of this
notice on its Internet Web site (https://
www.uspto.gov). Additionally,
individuals or organizations that need a
copy for the purpose of providing
comments, may send a request by phone
or e-mail to Terry Dey at ((571) 272–
7730 or terry.dey@uspto.gov) to receive
an e-mail copy of the notice. When
making a request for an e-mail copy, it
is requested that persons please specify
whether they wish to receive the
document in MS-Word, WordPerfect, or
HTML format.
The following definitions are
intended to facilitate an understanding
of the discussion of the proposed rules.
E:\FR\FM\10JYP1.SGM
10JYP1
]]>Agencies
[Federal Register Volume 71, Number 131 (Monday, July 10, 2006)]
[Proposed Rules]
[Pages 38799-38808]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-10437]
========================================================================
Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
========================================================================
Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 /
Proposed Rules
[[Page 38799]]
DEPARTMENT OF ENERGY
Office of Energy Efficiency and Renewable Energy
10 CFR Part 431
[Docket No. EE-DET-02-002]
RIN 1904-AA87
Energy Conservation Program for Certain Industrial Equipment:
Determination Concerning the Potential for Energy Conservation
Standards for Small Electric Motors
AGENCY: Office of Energy Efficiency and Renewable Energy, Department of
Energy.
ACTION: Departmental determination.
-----------------------------------------------------------------------
SUMMARY: The Department of Energy (DOE or the Department) has
determined, based on the best information currently available, that
energy conservation standards for certain single-phase, capacitor-
start, induction-run, small electric motors are technologically
feasible and economically justified, and would result in significant
energy savings. This determination initiates the process of
establishing, by notice and comment rulemaking, test procedures and
energy conservation standards for this equipment.
ADDRESSES: For access to the docket (EE-DET-02-002) to read background
documents or comments received, visit the U.S. Department of Energy,
Forrestal Building, Room 1J-018 (Resource Room of the Building
Technologies Program), 1000 Independence Avenue, SW., Washington, DC,
(202) 586-2945, between 9 a.m. and 4 p.m., Monday through Friday,
except Federal holidays. Please call Ms. Brenda Edwards-Jones at the
above telephone number for additional information regarding visiting
the Resource Room. Please note: The Department's Freedom of Information
Reading Room (formerly Room 1E-190 at the Forrestal Building) is no
longer housing rulemaking materials.
FOR FURTHER INFORMATION CONTACT: Antonio Bouza, U.S. Department of
Energy, Building Technologies Program (EE-2J), Office of Energy
Efficiency and Renewable Energy, 1000 Independence Avenue, SW.,
Washington, DC 20585-0121. Telephone (202) 586-4563, or
antonio.bouza@ee.doe.gov.
Thomas B. DePriest, Esq., U.S. Department of Energy, Office of
General Counsel, Mail Station GC-72, 1000 Independence Avenue, SW.,
Washington, DC 20585-0121. Telephone (202) 586-7432, or
thomas.depriest@hq.doe.gov.
SUPPLEMENTARY INFORMATION:
I. Introduction
A. Authority
B. Rulemaking Procedures
C. Background
II. Discussion of the Analysis of Small Motors
A. Purpose and Content
B. Methodology
1. Market Research
2. Engineering Analysis
3. Life-Cycle Cost Analysis
4. National Energy Savings Analysis
5. National Consumer Impacts Analysis
C. Analysis Results
1. Engineering Analysis
2. Life-Cycle Cost and Payback Period Analysis
3. National Energy Savings and Consumer Impacts
D. Discussion
1. Significance of Energy Savings
2. Impact on Consumers
III. Conclusion
A. Determination
B. Future Proceedings
I. Introduction
A. Authority
The National Energy Conservation Policy Act of 1978, amended the
Energy Policy and Conservation Act (EPCA or the Act) to add a part C to
title III of EPCA, to establish an energy-conservation program for
certain industrial equipment. (42 U.S.C. 6311-6317) The Energy Policy
Act of 1992 (EPACT), Public Law 102-486, also amended EPCA, and
included amendments that expanded title III to include small electric
motors. Specifically, EPACT amended section 346 of EPCA (42 U.S.C.
6317) to provide in paragraph (b) that the Secretary of Energy must
prescribe testing requirements and energy conservation standards for
those small electric motors for which the Secretary determines that
standards ``would be technologically feasible and economically
justified, and would result in significant energy savings.'' (42 U.S.C.
6317(b)(1)).
DOE construes section 346 in light of the provisions of section
325(n) and (o) of EPCA (which are in part B of title III of EPCA and
apply specifically to residential appliances). DOE does so for two
reasons. First, section 346(c) specifically makes the criteria in
section 325(n) applicable to the determination for small motor
standards. (42 U.S.C. 6317(c)) Second, and more generally, section
345(a) makes subsections (l) through (s) of section 325 applicable to
provisions of part C of title III of EPCA which includes section 346.
(42 U.S.C. 6316(a)).
Section 325(n) deals with petitions for amended standards.
Paragraph (n)(2) of section 325(n) provides for an initial
determination by DOE of technological feasibility, economic
justification, and significant energy savings in deciding whether to
grant a petition. This initial determination does not focus on specific
standard levels. Paragraph (n)(2) further provides that the initial
determination does not create any presumption with regard to the
application of these statutory criteria for promulgating specific
standards in a rulemaking pursuant to DOE's decision to grant a
petition. Section 325(o)(2) requires that determinations of
technological feasibility, economic justification, and significant
energy saving must ultimately be based on specific standards levels
that were proposed for public comment. (42 U.S.C. 6295(o)(2)) The
textual linkage of these provisions of section 325 to section 346(b)
implies that today's determination is similar in character and legal
effect to an initial determination upon a petition for new or amended
standards and that it does not create any presumptions with regard to
the determination of specific standard levels yet to be proposed.
In addition to this structural analysis of EPCA, DOE is also of the
view that, as a matter of policy, it is impractical to proceed on any
other basis. It is impractical because, even if one or more design
options have the potential for achieving energy savings, a
determination that such savings could in fact be achieved cannot be
made without first having developed test procedures to measure the
energy efficiency of small motors designs, and then conducting an in-
depth analysis of each design option. Such analysis might
[[Page 38800]]
show that no standard meets all three of the prescribed criteria: i.e.,
technological feasibility, economic justification and significant
energy savings.
For these reasons, the Department construes section 346(b) and
related provisions as requiring it to: (1) Determine preliminarily
whether standards for small motors would be ``technologically feasible
and economically justified, and would result in significant energy
savings,'' and (2) if energy conservation standards appear to be
warranted under these criteria, prescribe test procedures and conduct a
rulemaking concerning such standards. During the standards rulemaking,
the Department would describe whether, and at what level(s), to
promulgate energy conservation standards. This decision would be based
on in-depth consideration, with public participation, of the
technological feasibility, economic justification, and energy savings
of potential standard levels in the context of the criteria and
procedures for prescribing new or amended standards established by
section 325(o) and (p) (42 U.S.C. 6295(o), (p)).
Section 340(13)(F) of EPCA (42 U.S.C. 6311(13)(F)) provides the
following definition for ``small electric motor'': The term ``small
electric motor'' means a NEMA [National Electrical Manufacturers
Association] general-purpose alternating-current single-speed induction
motor, built in a two-digit frame number series in accordance with NEMA
Standards Publication MG1-1987.
In NEMA Standards Publication MG1-1987, which is entitled ``Motors
and Generators,'' the two-digit frame series encompasses NEMA frame
sizes 42, 48, and 56, and motors with horsepower ratings ranging from
\1/4\ to 3 horsepower. These motors operate at 60 hertz and have either
a single-phase or a three-phase electrical design.
Section 346(b)(3) of EPCA (42 U.S.C. 6317(b)(3)) specifies that a
standard prescribed for small electric motors shall not apply to any
small electric motor that is a component of a covered product under
section 322(a) of EPCA (42 U.S.C. 6292(a)) or of covered equipment
under section 340 (42 U.S.C. 6311). Such products and equipment include
residential air conditioners and heat pumps, furnaces, refrigerators
and freezers, clothes washers and dryers, and commercial packaged air-
conditioning and heating equipment.
B. Rulemaking Procedures
EPCA does not explicitly identify the rulemaking procedures that
govern promulgation of test procedures and standards for small electric
motors. In conducting rulemakings generally, the Department must, at a
minimum, adhere to the procedures required by the Administrative
Procedure Act (5 U.S.C. 551 et seq.) and section 501 of the Department
of Energy Organization Act (DOE Organization Act) (42 U.S.C. 7191).
Section 501 of the DOE Organization Act in essence requires the
following: (1) Issuance of a notice of proposed rulemaking (NOPR), (2)
an opportunity for comment, (3) an opportunity for presentation of oral
comments, if there exists ``a substantial issue of fact or law'' or if
the rule will have a ``substantial impact,'' and (4) publication of the
final rule accompanied by appropriate explanation. Pursuant to
Executive Order 12889, ``Implementation of the North American Free
Trade Agreement,'' December 27, 1993, the comment period on a NOPR must
be at least 75 days.
Consistent with section 345(a), in promulgating test procedures for
small electric motors, the Department will also use procedures
prescribed for adopting test procedures under parts B and C of EPCA.
(42 U.S.C. 6293(b)(2) and 6314(b)) Therefore, in addition to the
generic procedural requirements described above, the Department will
provide an opportunity for oral comment (i.e., hold a public meeting)
on the proposed test procedures, regardless of the ``substantial
issue'' or ``substantial impact'' criteria, as it does in other EPCA
test procedure rulemakings. See, for example, 42 U.S.C. 6314(b).
Consistent with section 345(a), in determining by rule whether to
impose a specified standard level, the Department will use the
following procedures:
1. The Department will issue an advance notice of proposed
rulemaking (ANOPR), followed by a comment period (42. U.S.C. 6295
(p)(1));
2. The Department will issue a NOPR setting forth the maximum
efficiency improvement that is technologically feasible and, if the
proposed standard does not achieve this level, an explanation of why
(42 U.S.C. 6295(p)(2)); and
3. The Department will hold a public meeting following issuance of
the NOPR. (42 U.S.C. 6306(a)(1).)
In addition, the Department also has a policy, in conducting
rulemakings on appliance standards, of allowing 75 days for comment on
an ANOPR (rather than the 60 days required by EPCA), with at least one
public hearing or meeting during this period. Procedures for
Consideration of New or Revised Energy Conservation Standards for
Consumer Products, 10 CFR part 430, subpart C, Appendix A (Process
Rule).
C. Background
The Department began the analysis for this determination by
collecting information from manufacturers of small motors and others.
The Department conducted preliminary analyses and shared its
preliminary findings regarding efficiency improvement in small motors.
Subsequently, the Department received data and information, including
that provided by both the National Electrical Manufacturers Association
(NEMA) and the Small Motors and Motion Association (SMMA) (the NEMA/
SMMA Working Group).
A key issue that arose early in this determination process is the
definition of a ``small electric motor'' and precisely which motors are
covered by this rulemaking. The definition of a ``small electric
motor'' derives from the definition of the term ``general purpose
motor.'' The EPCA definition \1\ of a small motor is tied to the NEMA
Standards Publication MG1-1987 performance requirements that NEMA has
established for general purpose motors, such as the minimum levels for
breakdown and locked rotor torque for small electric motors presented
in MG1-1987 paragraph 12.32.
---------------------------------------------------------------------------
\1\ EPCA does not define the term ``general purpose motor,''
although it does define the terms ``definite purpose motor'' and
``special purpose motor.'' According to EPCA, ``definite purpose
motor'' means ``any motor designed in standard ratings with standard
operating characteristics or standard mechanical construction for
use under service conditions other than usual or for use on a
particular type of application and which cannot be used in most
general purpose applications.'' Section 340(13)(B). (42 U.S.C. 6311
(13)(B)) Likewise, ``special purpose motor'' means ``any motor,
other than a general purpose motor or definite purpose motor, which
has special operating characteristics or special mechanical
construction, or both, designed for a particular application. `` Id.
at (C). Consequently, DOE must derive the term ``general purpose''
by eliminating those definite purpose motors and special purpose
motors and must subsequently define the term within the context of
NEMA performance characteristics that can operate successfully in
many different applications.
---------------------------------------------------------------------------
In this determination process, the Department considered only those
classes of small electric motors covered under the EPCA definition
which satisfy the performance requirements for general purpose motors
established by NEMA Standards Publication MG1-1987, and which are not a
component of another product covered under EPCA.
In consideration of the above, DOE finds that of the motors that
satisfy the frame-size requirements of the small-motors definition,
only a subset satisfies the other performance requirements of
[[Page 38801]]
the definition. Among single-phase motors with a two-digit frame size,
the Department found that only capacitor-start motors, including both
capacitor-start, induction run and capacitor-start, capacitor-run
motors, can meet the torque requirements for NEMA general-purpose
motors. Among three-phase small motors, the Department found that only
non-servo motors can meet the NEMA performance requirements for
general-purpose motors. Hence, the Department's analysis covered only
these types of single- and three-phase small motors, and the Department
identifies them in this determination as ``considered small motors.''
The annual commercial sales volume of considered small motors is
approximately four million units for capacitor-start motors and one
million units for three-phase motors. These motors are used in a wide
variety of commercial and industrial machine and processing
applications, with the largest being pumping equipment and commercial/
industrial heating, ventilating, and air-conditioning equipment rated
over 760,000 British thermal units per hour (Btu/h).
The Department then conducted an analysis that estimated the likely
range of energy savings and economic benefits that would result from
energy conservation standards for small electric motors, and prepared a
report describing its analysis. In June 2003, the Department made the
report ``Analysis of Energy Conservation Standards for Small Electric
Motors'' available for public comment on its Web site at https://
www.eere.energy.gov/buildings/appliance_standards/commercial/small_
electric_motors.html. The report made no recommendation concerning the
determination that the Department should make.
The Department received comments concerning its analysis of small
motors from NEMA, SMMA, and the American Council for an Energy-
Efficient Economy (ACEEE). In general, the comments received did not
criticize specific elements of the Department's technical analysis. The
ACEEE comment indicated that ACEEE found the analysis to be
``technically robust.'' (ACEEE, No. 3 at p. 1) \2\ However, NEMA
asserted that energy conservation standards for certain small motors
were not economically justified and would harm U.S. motor
manufacturers, and ACEEE claimed that energy conservation standards for
small motors are unlikely to save much energy and would be a diversion
from exploring other energy savings approaches. (NEMA, No. 1 at p. 2;
ACEEE, No. 3 at p. 2) ACEEE commented that the Department could achieve
greater energy savings if it did not restrict its analysis to
capacitor-start, capacitor-run and capacitor-start, induction-run
single-phase motors, and three-phase motors. ACEEE commented that these
categories of small motors account for only four percent of domestic
shipments and that much greater energy savings could be realized by
switching between different types of small motors. (ACEEE, No. 3 at p.
1) ACEEE suggested that the Department encourage users of small motors
to shift between classes of motors, such as from split-phase and
shaded-pole motors to capacitor-start, capacitor-run and capacitor-
start, induction-run motors; it commented that the substitution would
yield greater savings than improvements that are restricted to the
category of capacitor-start, induction-run motors. Further, ACEEE
suggested replacing considered small motors with advanced types, such
as electronically commutated permanent magnet motors. (ACEEE, No. 3 at
p. 1) While the Department understands ACEEE's concern, the market
transformation that ACEEE suggests is outside the scope of this
determination since the purpose of energy conservation standards is to
increase the energy performance of regulated products rather than
change the product-purchase-and-use behavior of consumers.
---------------------------------------------------------------------------
\2\ A notation in the form ``ACEEE, No. 3 at p. 1'' identifies a
written comment the Department has received and has included in the
docket of this rulemaking. This particular notation refers to a
comment (1) by the American Council for an Energy-Efficient Economy
(ACEEE), (2) in document number 3 in the docket of this rulemaking
(maintained in the Resource Room of the Building Technologies
Program), and (3) appearing on page 1 of document number 3.
---------------------------------------------------------------------------
The SMMA generally supported the findings of the NEMA/SMMA Working
Group. (SMMA, No. 2 at p. 1) The main findings of the NEMA/SMMA Working
Group pertained to the cost-efficiency relationship for small motors,
and these findings were incorporated into the Department's engineering
analysis for this determination.
NEMA commented that many small motors are used in other equipment
that is subject to Federal energy conservation standards, and that
small motors in those product applications are not within the scope of
the Department's analysis and proceeding. (NEMA, No. 1 at p. 1) The
Department agrees with NEMA, insofar as the EPCA definition of small
motors and exclusions constrain the motors considered in the
Department's analysis to a subset of the total population of small
electric motors. As stated above, pursuant to section 346(b)(3) of EPCA
(42 U.S.C. 6317(b)(3)), the Department did not consider in its analysis
motors that are a component of a covered product or equipment.
In a related comment, NEMA requested that the Department designate
small motors as ``covered equipment,'' which it asserted was done for
general-service incandescent lamps although there was no standard for
such lamps, and cited 59 FR 49468 (September 28, 1994). NEMA requested
the designation so that States that are attempting to set efficiency
standards for small motors would be preempted by the Federal action.
(NEMA, No. 1 at p. 1) Section 345(a) of EPCA (42 U.S.C. 6316(a))
provides in part that section 327 of the Act (42 U.S.C. 6297), which
addresses preemption of State energy conversation requirements by EPCA,
shall apply to various equipment covered by part C of title III of
EPCA, which includes small electric motors. Thus, State energy use and
efficiency requirements for ``small electric motors,'' as defined in 42
U.S.C. 6311(13)(F), are already preempted to the extent provided in
section 327 of EPCA (42 U.S.C. 6297). No further action by DOE is
needed to provide for such preemption. Small motors that are not within
EPCA's definition of small motors are not covered by EPCA; therefore,
the Act does not preempt State energy use and efficiency requirements
with respect to motors not covered by EPCA.
II. Discussion of the Analysis of Small Motors
A. Purpose and Content
The Department performed an analysis of the feasibility of
achieving significant energy savings as a result of energy conservation
standards for considered small electric motors. The Department presents
the results of this analysis in a technical support document (TSD) for
this determination. In subsequent analyses for the standards ANOPR,
NOPR, and final rule, DOE will perform the more robust analyses
required by EPCA. These analyses will involve more precise and detailed
information that the Department will develop and receive during the
standards rulemaking process, and will detail the effects of proposed
energy conservation standards for small electric motors.
B. Methodology
To address EPCA requirements that DOE determine whether energy
conservation standards for small motors would be technologically
feasible and economically justified, and result in significant energy
savings (42 U.S.C. 6317(b)(1)), the Department's analysis
[[Page 38802]]
consisted of five major elements: (1) Market research to better
understand where and how small motors are used, (2) engineering
analysis to estimate how different design options affect efficiency and
cost, (3) life-cycle cost (LCC) analysis to estimate the costs and
benefits to users from increased efficiency in small motors, (4)
national energy savings analysis to estimate the potential energy
savings on a national scale, and (5) national consumer impacts analysis
to estimate potential economic costs and benefits that would result
from improving energy efficiency in the considered small motors. The
following is a brief description of each element.
1. Market Research
The Department conducted research on the market for considered
small motors, including annual shipments, the current range of energy
efficiencies, motor applications and utilization, market structure, and
distribution channels. It used information from original equipment
manufacturers (OEMs), trade associations that support industrial
sectors, consultation with small motor manufacturers, and independent
experts. Also, NEMA provided data, on its own initiative, to the
Department on sales of two-digit-frame small motors to domestic
customers by its member manufacturers, covering the period from 1971 to
2001. Based on its market research, the Department estimated that, on
average, capacitor-start and three-phase small motors are used 2,500
hours annually at a loading of 70 percent of rating.
Based on its market research, including input from OEMs that
incorporate small motors into their products and the NEMA/SMMA Working
Group, the Department used seven years as the mean lifetime for
capacitor-start motors, and nine years for three-phase motors.
Also based on its market research, the Department determined that
the small motors considered in this determination are used in
commercial and industrial settings with the corresponding tariffs. The
Department estimated that approximately three-fourths of capacitor-
start motors are used by utility customers on a commercial tariff,
while virtually all users of small, three-phase motors are on an
industrial tariff. Industrial electricity prices tend to be lower than
commercial prices.
2. Engineering Analysis
In the engineering analysis, the Department examined methods for
increasing energy efficiency that included increasing the amount of
active material (e.g., the diameter of wire conductors), substituting a
higher grade of steel for the magnetic components, improving the
mechanical components and design (winding, bearings, and fan), and
improving the quality control of components and assembly. Manufacturers
of small motors use all of these methods of motor-efficiency
improvement in their design and production processes. In general, the
Department found that these methods may increase either the motor cost
or size if there are no other changes in the motor-design parameters.
In particular, the Department evaluated several ways to achieve
increased efficiency, including (1) changing the quality of the grade
of electrical steel, (2) changing the quantity of electrical steel
(stack length), and (3) changing the magnetic flux density by adjusting
the effective turns in the copper windings and/or changing the
thickness of the steel laminations in the core of a small motor. In its
preliminary engineering evaluation, the Department found the efficiency
improvement method of changing flux density to be the most expensive of
the three methods. As a result, the Department analyzed only the two
lower-cost efficiency improvement methods to help maintain the
simplicity and clarity of its analysis.
In particular, the Department examined a one-half-horsepower,
capacitor-start, induction-run motor and a one-horsepower, three-phase
motor as prototypes for improving the energy efficiency of small
motors. To estimate the efficiency changes and additional costs
resulting from design changes, the Department used two sets of data.
The Department derived the first set by engaging an independent motor
industry expert to estimate motor-efficiency costs from motor test data
and design cost estimates. The expert obtained motor test data for a
sample of small motors using a traditional motor performance program
based on equivalent-circuit analysis to calculate efficiency changes
resulting from changes in steel grades and stack lengths. This
methodology was similar to methods commonly used by motor
manufacturers. The NEMA/SMMA Working Group provided, on its own
initiative, a comparable set of data in an aggregated form.
The Department had a concern that the cost-efficiency curves
presented in the June 2003 report ``Analysis of Energy Conservation
Standards for Small Electric Motors'' were based on 2001 materials
pricing data, which represented a relative low-price point for many
electrical steels (i.e., the steel used for building electric motor
rotors and stators). The price of electrical steels has increased since
2001. However, the slope of the engineering analysis cost-efficiency
curves depends on the price difference between the baseline unit (i.e.,
low efficiency steel) and the higher efficiency unit (i.e., better
grade steel). Electrical steel price data collected in 2005 for the
distribution transformer standards rulemaking along with a check of
2001 and 2005 pricing for specific steels used in small motors verified
that the price differential between the baseline and high-efficiency
steels did not increase between 2001 and 2005. For this reason, the
Department determined that it was not necessary to update the material
prices for the engineering analysis, because updating the material
prices, or calculating average material prices representative of a
multi-year period, would not significantly change the Department's
engineering results.
3. Life-Cycle Cost Analysis
Based on its engineering analysis of the available technical data,
the Department conducted a life-cycle cost (LCC) analysis to estimate
the net benefit to users from increased efficiency in capacitor-start
and three-phase small motors. The LCC analysis compared the additional
up-front cost of a higher-efficiency motor to the discounted value of
electricity savings over the life of the motor. The Department's LCC
analysis used the following inputs: estimated average motor use in
terms of hours and loading and typical motor lifetime (discussed
above), estimated average prices for base motors and more-efficient
motors, average electricity prices paid by users of capacitor-start and
three-phase small motors, and the discount rate.
The Department received significant comment regarding its estimates
of motor lifetimes. The Department understands that the typical
lifetime of a small motor is not well documented. Most industry experts
with whom the Department consulted suggested the average life for
considered motors is at most ten years, depending on the use and
physical environment. The NEMA/SMMA Working Group estimated an average
life of five years for a capacitor-start motor and ten years for a
three-phase motor. In view of these considerations, the Department
estimated the mean lifetime for a capacitor-start motor at seven years
and a three-phase motor at nine years. Moreover, the Department
believes that the potential lifetime of a considered motor may be
greater than that of the driven equipment. Thus, the actual motor
lifetime may be limited by the
[[Page 38803]]
lifetime of the equipment it drives. In view of this issue, NEMA
commented that the economic justification of energy conservation
standards for the user was not good. Where simple payback periods range
from 4.9 to 9 years, NEMA questioned whether the equipment driven by
the small motor will last that long and, thus, enable the payback for
the higher cost of improved efficiency to be realized. (NEMA, No. 1 at
p. 2).
The Department acknowledges that a small motor's lifetime could be
limited by the life of the equipment it drives. The Department used a
distribution of lifetimes for small electric motors in its analysis.
For capacitor-start motors, the analysis used the range of 5 to 9 years
for the lifetime, and for polyphase motors the Department used a range
of 7 to 11 years. Given existing data and the balance of diverse
stakeholder and expert comments, the Department considers its current
lifetime estimates to be reasonable and accurate for this determination
analysis.
The Department estimated the base purchase price of typical
capacitor-start and three-phase small motors using (1) prices listed in
the 2001-2002 W.W. Grainger, Inc., catalog, (2) estimates of the
percentage of the list price paid in different motor distribution
channels, and (3) estimates of the distribution of sales among the
three channels (motor manufacturer to OEM, motor manufacturer to
distributor to original equipment manufacturer, and motor manufacturer
to distributor to end user). The Department derived the price for a
motor that incorporated design changes to improve efficiency by
applying the estimated percentage of incremental cost from the
engineering analysis to the average base price of the motor estimated
from the Grainger, Inc., catalog.
The Department estimated average commercial and industrial
electricity prices using the 2010 and 2020 forecasts from the Energy
Information Administration's (EIA) Annual Energy Outlook 2006. It then
derived average prices paid by users of capacitor-start and three-phase
small motors based on the tariff classes of users (discussed above).
Given that relatively small industrial establishments use considered
small, polyphase (i.e., three-phase) motors more than larger
establishments, and that small industrial establishments have higher
electricity tariffs than larger industry, the Department estimated the
electricity price for polyphase motors as five percent higher than the
national average industrial price of electricity.
The Department derived a discount rate based on the weighted-
average cost of capital for representative companies using products
containing the considered small motors. After deducting for expected
inflation, the Department estimated the average cost of capital for
considered small motor owners as 7.5 percent.
4. National Energy Savings Analysis
To estimate national energy savings for small motors sold from 2010
through 2030, the Department calculated the energy consumption of two
typical sizes of small motors: One-half horsepower, capacitor-start,
induction-run motors, and one-horsepower, three-phase motors. The
Department used both its own data and the NEMA/SMMA Working Group data
for capacitor-start, induction-run motors. However, it used only its
own data for three-phase motors because the NEMA/SMMA Working Group
based its analysis on a one-half horsepower motor, which is less common
than the one-horsepower motor, and which therefore has losses that may
not be representative of considered small, three-phase motors. The
Department calculated the energy efficiencies of small motors with
improved-steel-grade and increased-stack-length design options, and
extrapolated the results to a national average for all new capacitor-
start, induction-run and three-phase motors (constituting the energy
conservation standards cases).
The Department estimated the energy savings of the standards cases
relative to two base cases--little improvement and moderate improvement
in efficiency--in the absence of any standards. The Department
formulated each base case using information from historical trends, and
input from the NEMA/SMMA Working Group, provided on its own initiative.
The Department also evaluated two small-motors-shipments scenarios,
estimating national energy savings for average annual growth in
shipments of 1 percent and 1.5 percent. These shipments scenarios are
also based upon historical trends and input from the NEMA/SMMA Working
Group.
To estimate potential energy savings from a possible energy
conservation standard, the Department used an accounting model that
calculated total end-use electricity savings in each year of a 35-year
forecast. The model featured a product-retirement function to calculate
the number of units sold in a given year, or vintage, which would still
be in operation in future years. Some of the small motors sold in 2030
will operate through 2040. The retirement function assumed that
individual motor lifetime is evenly distributed in a five-year interval
around the mean lifetime.
The Department calculated primary energy savings associated with
end-use electricity savings using data from EIA's Annual Energy Outlook
2006 (AEO). These data provided an average multiplier for relating end-
use electricity to primary energy use (energy consumption by the power
plant) for each year from 2010 to 2020. The Department extrapolated the
trend in these years to derive factors for 2021 to 2040.
5. National Consumer Impacts Analysis
The Department estimated national economic impacts on end users in
terms of the net present value (NPV) of cumulative benefits from 2010
to 2040. It considered these impacts under the same range of scenarios
as it did for estimating national energy savings. It used the
incremental equipment costs and energy savings for each energy-
efficiency level that it applied in the LCC analysis. To simplify the
analysis, the Department estimated the value of energy savings using
the average AEO forecast electricity price from 2010 to 2020. The
Department discounted future costs and benefits by using a seven-
percent discount rate, according to the ``Guidelines and Discount Rates
for Benefit Analysis of Federal Programs,'' issued by the Office of
Management and Budget in 1992 (Circular No. A-94, Revised).
C. Analysis Results
1. Engineering Analysis
As described above, the Department conducted separate analyses of
changes in the grade of electrical steel and a change in the stack
length to improve the energy efficiency of small motors. In each case,
the Department gave the base motor a ``per-unit'' cost of one. The
Department related all design-option changes to the base motor per-unit
cost of one. For example, if a change in electrical steel created a 10
percent change in the cost of materials, such as electrical steel, the
Department assigned the per-unit number of 1.10 for the new design. In
addition, the NEMA/SMMA Working Group provided, on its own initiative,
comparable data, where each of four manufacturers selected a typical
small motor to use as the base motor. For steel-grade design options,
the NEMA data refer to the average values of the four manufacturers.
For stack-change design options, the NEMA/SMMA Working Group provided
data that it considered most typical. Tables 1 and 2 summarize the
results of the analysis of steel-grade and stack-length
[[Page 38804]]
changes. For capacitor-start motors, the Department analyzed the cost
of efficiency improvements for both 56-frame and 48-frame motors. These
two frames represent distinct frame sizes that are common for one-half
horsepower motors.
Overall, the Department's analysis and the NEMA/SMMA Working Group
data were more comparable for the stack-change design options than they
were for the design options related to steel-grade changes. The NEMA/
SMMA Working Group estimated a much smaller efficiency improvement due
to steel grade improvements than the Department's analysis.
Table 1.--Capacitor-Start Motors, \1/2\ Horsepower, 4-Pole, Open Drip-Proof
----------------------------------------------------------------------------------------------------------------
Grade A Grade B Grade B+ M47
----------------------------------------------------------------------------------------------------------------
Steel-Grade Design Options
----------------------------------------------------------------------------------------------------------------
DOE Analysis, 56-Frame:
Per-unit Cost............................... 1.00 1.03 1.08 1.25
Efficiency.................................. 53.9% 57.4% 59.3% 60.5%
DOE analysis, 48-Frame:
Per-unit Cost............................... 1.00 1.03 1.10 1.25
Efficiency.................................. 62.6% 65.4% 66.8% 69.0%
----------------------------------------------------------------------------------------------------------------
Grade 1 Grade 2 Grade 3
----------------------------------------------------------------------------------------------------------------
NEMA/SMMA data:
Per-unit Cost............................................... 1.00 1.10 1.21
Efficiency.................................................. 60.0% 61.7% 62.9%
----------------------------------------------------------------------------------------------------------------
Base Plus stack Plus 2 stack Plus 3 stack
----------------------------------------------------------------------------------------------------------------
Stack-Change Design Options
----------------------------------------------------------------------------------------------------------------
DOE analysis, 56-Frame:
Per-unit Cost............................... 1.00 1.09 1.19 1.29
Efficiency.................................. 53.9% 58.1% 60.3% 62.0%
DOE analysis, 48-Frame:.......................
Per-unit Cost............................... 1.00 1.07 1.15 1.22
Efficiency.................................. 62.6% 63.5% 64.4% 65.1%
NEMA/SMMA data:
Per-unit Cost............................... 1.00 1.10 1.20 1.30
Efficiency.................................. 62.0% 64.3% 65.5% 66.5%
----------------------------------------------------------------------------------------------------------------
Table 2.--Polyphase Motors, 4-Pole, Open Drip-Proof
----------------------------------------------------------------------------------------------------------------
Grade A+ Grade B+ M47
----------------------------------------------------------------------------------------------------------------
Steel-Grade Design Options
----------------------------------------------------------------------------------------------------------------
DOE analysis, 1 horsepower:
Per-unit Cost............................................... 1.0 1.04 1.20
Efficiency.................................................. 76.4% 78.3% 81.2%
----------------------------------------------------------------------------------------------------------------
Grade 1 Grade 2 Grade 3
----------------------------------------------------------------------------------------------------------------
NEMA/SMMA data, \1/2\ horsepower:
Per-unit Cost............................................... 1.00 1.10 1.20
Efficiency.................................................. 68.1% 70.7% 72.1%
----------------------------------------------------------------------------------------------------------------
Base Plus stack Plus 2 stack Plus 3 stack
----------------------------------------------------------------------------------------------------------------
Stack-Change Design Options
----------------------------------------------------------------------------------------------------------------
DOE analysis, 1 horsepower:
Per-unit Cost............................... 1.00 1.06 1.18 1.24
Efficiency.................................. 76.4% 77.2% 78.9% 79.2%
NEMA/SMMA analysis, \1/2\ horsepower:
Per-unit Cost............................... 1.00 1.08 1.16 1.24
Efficiency.................................. 72.2% 73.1% 73.9% 74.1%
----------------------------------------------------------------------------------------------------------------
As stated above, the Department received no comments criticizing
specific elements of its technical analysis. NEMA agreed with the
Department's conclusions that it is technically feasible to increase
the efficiency of small motors in frame sizes 42, 48, and 56 for three-
phase and single-phase motors, and that improving grades of steel and
redesigning laminations will provide increased efficiency, but at much
higher capital costs. (NEMA, No. 1 at p. 2) ACEEE found the
Department's analysis to be ``technically robust.'' (ACEEE, No. 3 at p.
1).
NEMA commented that manufacturer costs and impacts from a possible
[[Page 38805]]
standard may be high. It asserted that there will be high capital costs
and, presumably, less economic benefit to the manufacturer than the
Department described in its June 2003 determination report ``Analysis
of Energy Conservation Standards for Small Electric Motors.'' (NEMA,
No. 1 at p. 2) While the economic impacts of a possible standard on
manufacturers may be substantial, DOE did not evaluate the full impact
of possible standards on manufacturers in this determination. The
Department instead used the presence of high-efficiency designs in the
marketplace as an indicator of the probable economic feasibility of
manufacturing high efficiency designs. The Department will address
detailed economic impacts on manufacturers at such time that it
conducts a manufacturer impact analysis for an energy efficiency
standards rulemaking.
In addition, NEMA commented that there was a strong likelihood that
OEMs will switch to alternative small motors that are not covered to
avoid any added costs resulting from energy conservation standards.
(NEMA, No. 1 at p. 2) The Department believes that shifting from, for
example, a capacitor-start, induction-run small motor to a less
efficient shaded-pole or split-phase small motor design would reduce
potential energy savings. However, the Department understands that
small motors are not generally interchangeable. Physical constraints in
some current equipment designs may preclude the substitution of another
type of motor for a considered small motor. Lacking clear evidence or
data regarding the change in sales of considered small motors due to
possible standards, the Department did not model this potential
phenomenon in the determination analysis. (As explained below, the
Department intends to undertake a rulemaking to develop standards for
small motors. If it appears to DOE in the initial phases of the
rulemaking that the potential for motor switching warrants further
examination, the Department will address that issue in its analyses
during the rulemaking.)
2. Life-Cycle Cost and Payback Period Analysis
The Department presents key results for capacitor-start motors in
Tables 3 and 4 below. Using the DOE data for capacitor-start motors,
the steel-grade options all have lower LCC than the base motor.
However, results using the NEMA/SMMA average data show an increase in
LCC at steel grade 3, with no change in LCC at steel grade 2. The DOE
analysis shows the stack-length options increasing the LCC, while the
NEMA/SMMA results show a slight decrease for the first option, but then
an increase in LCC for the higher-efficiency stack change options.
Table 3.--Impacts of Efficiency Improvement on Typical End User, Capacitor-Start, \1/2\ Horsepower, DOE Data*
--------------------------------------------------------------------------------------------------------------------------------------------------------
Steel grade Stack change
------------------------------------------------------------------------------------------
Grade A Plus 2 Plus 3
(base) Grade B Grade B+ M47 Plus stack stack stack
--------------------------------------------------------------------------------------------------------------------------------------------------------
Motor Price-Buyer **......................................... $103 $106 $114 $129 $111 $119 $126
Annual Operating Cost........................................ $75 $72 $70 $68 $74 $73 $72
Life-Cycle Cost (7.5% DR).................................... $501 $487 $486 $490 $502 $505 $508
Change in LCC (WRT Base)..................................... ........... -$14.07 -$14.47 -$11.37 $1.51 $4.05 $7.47
Percent Change in LCC........................................ ........... -2.8% -2.9% -2.3% 0.3% 0.8% 1.5%
Payback Period (years)....................................... ........... 1.0 2.2 3.7 6.7 7.2 7.9
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Data refer to a specific typical motor.
** Based on actual motor price in Grainger catalog.
Table 4.--Impacts of Efficiency Improvement on Typical End User, Capacitor-Start, \1/2\ Horsepower, NEMA/SMMA Data
--------------------------------------------------------------------------------------------------------------------------------------------------------
Steel grade * Stack change **
------------------------------------------------------------------------------------------
Grade 1 Plus 2 Plus 3
(base) Grade 2 Grade 3 Base Plus stack stack stack
--------------------------------------------------------------------------------------------------------------------------------------------------------
Motor Price-Buyer ***........................................ $117 $128 $141 $117 $128 $140 $152
Annual Operating Cost........................................ $78 $76 $75 $76 $73 $72 $71
Life-Cycle Cost (7.5% DR).................................... $532 $532 $537 $518 $516 $520 $526
Change in LCC (WRT Base)..................................... ........... -$0.01 $5.20 ........... -$2.63 $1.41 $7.36
Percent Change in LCC........................................ ........... 0.0% 1.0% ........... -0.5% 0.3% 1.4%
Payback Period (years)....................................... ........... 5.3 6.7 ........... 4.3 5.6 6.7
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Data are average of four manufacturers.
** Data reflect costs and performance of a typical motor.
*** Estimated by DOE based on Grainger catalog prices.
Tables 5 and 6 present results for small, polyphase motors.
Although the base motors are different in the DOE and NEMA/SMMA data
sets, it is the relative change for each motor that is of most
interest. Using the DOE data, the steel-grade options both have lower
LCC than the base motor. However, results based on the NEMA/SMMA
average data show an increase in LCC at steel grade 3, with the LCC at
steel grade 2 being equivalent to that for the base motor. Using the
DOE data, the stack-length options moderately increase the LCC relative
to the base motor, while the increase in LCC is more pronounced in the
results based on the NEMA/SMMA data.
[[Page 38806]]
Table 5.--Impacts of Efficiency Improvement on Typical End User, Polyphase 1 Horsepower, DOE Data*
----------------------------------------------------------------------------------------------------------------
Steel grade Stack change
-----------------------------------------------------------------------------
Grade A Plus 2 Plus 3
(base) Grade B+ M47 Plus stack stack Stack
----------------------------------------------------------------------------------------------------------------
Motor Price-Buyer **.............. $119 $124 $143 $126 $140 $148
Annual Operating Cost............. $98 $96 $93 $97 $95 $95
Life-Cycle Cost (7.5% DR)......... $746 $736 $733 $747 $748 $752
Change in LCC (WRT Base).......... ........... -$10.49 -$12.98 $0.86 $1.69 $6.14
Percent Change in LCC............. ........... -1.4% -1.7% 0.1% 0.2% 0.8%
Payback Period (years)............ ........... 2.0 4.1 7.3 6.9 8.1
----------------------------------------------------------------------------------------------------------------
* Data refer to a specific typical motor.
** Based on actual motor price in Grainger catalog.
Table 6.--Impacts of Efficiency Improvement on Typical End User, Polyphase \1/2\ Horsepower, NEMA/SMMA Data
--------------------------------------------------------------------------------------------------------------------------------------------------------
Steel grade * Stack change **
------------------------------------------------------------------------------------------
Grade 1 Plus 2 Plus 3
(base) Grade 2 Grade 3 Base Plus stack stack stack
--------------------------------------------------------------------------------------------------------------------------------------------------------
Motor Price-Buyer ***........................................ $125 $138 $151 $126 $136 $146 $156
Annual Operating Cost........................................ 53.9 $51.9 $50.9 $50.8 $50.2 $49.7 $49.5
Life-Cycle Cost (7.5% DR).................................... 469 $469 $475 $450 $456 $463 $472
Change in LCC (WRT Base)..................................... ........... -$0.02 $6.02 ........... $6.48 $12.96 $22.14
Percent Change in LCC........................................ ........... 0.0% 1.3% ........... 1.4% 2.9% 4.9%
Payback Period (years)....................................... ........... 6.4 8.4 ........... 17.9 17.9 23.9
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Data are average of four manufacturers.
** Data reflect costs and performance of a typical motor.
*** Estimated by DOE based on Grainger catalog prices.
3. National Energy Savings and Consumer Impacts
The Department estimated national energy savings and consumer
impacts of energy conservation standards for the considered small
motors using its own engineering analysis data and the NEMA/SMMA
Working Group data. The Department assumed that energy conservation
standards would take effect in 2010, and estimated cumulative energy
savings and NPV impacts relative to alternative base cases.
The results using the Department's analysis of design options
indicate cumulative energy savings for capacitor-start, induction run-
small motors ranging from 0.47 to 0.59 quad (see table 7). The
corresponding NPV ranges from $0.28 to $0.35 billion. The results based
on the data provided by the NEMA/SMMA Working Group, on its own
initiative, show lower energy savings and economic benefits.
The results using the Department's analysis of design options for
three-phase small motors indicate cumulative energy savings from 0.14
to 0.19 quad (see table 8). The corresponding NPV ranges from $0.08 to
$0.11 billion. For the three-phase motors, the Department did not
estimate national impacts using the data provided by the NEMA/SMMA
Working Group, on its own initiative, because these data were based on
a one-half horsepower motor instead of the more typical one-half
horsepower size. The NEMA/SMMA data for half-horsepower motors show
some efficiency gains, but with an increase in LCC, which would lead to
a negative NPV.
Table 7.--Cumulative Energy and Consumer Impacts of Energy Efficiency Improvement for \1/2\ Horsepower Capacitor
Start-Induction-Run Motors Projected to be Sold in the 2010-2030 Period *
----------------------------------------------------------------------------------------------------------------
Energy savings (quads) NPV (year 2005 dollars in
-------------------------------- billions, discounted at 7
Future scenario percent to 2005)
DOE NEMA/SMMA -------------------------------
DOE NEMA/ SMMA
----------------------------------------------------------------------------------------------------------------
Low-efficiency-gain base case, low shipments 0.54 0.19 0.33 0.04
growth.........................................
Low-efficiency-gain base case, high shipments 0.59 0.21 0.35 0.04
growth.........................................
Moderate-efficiency-gain base case, low 0.47 0.12 0.28 -0.05
shipments growth...............................
Moderate-efficiency-gain base case, high 0.51 0.12 0.30 -0.05
shipments growth...............................
----------------------------------------------------------------------------------------------------------------
* The values given for each scenario correspond to the design option with the combination of highest energy
savings and most favorable consumer NPV.
[[Page 38807]]
Table 8.--Cumulative Energy and Consumer Impacts of Energy Efficiency Improvement for One-Horsepower Three-Phase
Motors Projected To Be Sold in the 2010-2030 Period *
----------------------------------------------------------------------------------------------------------------
Energy savings (quads) NPV (year 2005 dollars in
-------------------------------- billions, discounted at 7
Future scenario percent to 2005)
DOE NEMA/ SMMA -------------------------------
DOE NEMA/ SMMA
----------------------------------------------------------------------------------------------------------------
Low-efficiency-gain base case, low shipments 0.17 (\1\) 0.10 (\1\)
growth.........................................
Low-efficiency-gain base case, high shipments 0.19 (\1\) 0.11 (\1\)
growth.........................................
Moderate-efficiency-gain base case, low 0.14 (\1\) 0.08 (\1\)
shipments growth...............................
Moderate-efficiency-gain base case, high 0.15 (\1\) 0.09 \1\
shipments growth...............................
----------------------------------------------------------------------------------------------------------------
* The values given for each scenario correspond to the design option with the combination of highest energy
savings and most favorable consumer NPV.
\1\ Not available.
The differences between the results using the Department's analysis
of design options and those using the data that the NEMA/SMMA Working
Group provided on its own initiative reflect differences in estimates
of the efficiency and cost increases associated with different design
options.
D. Discussion
1. Significance of Energy Savings
Section 346(b)(1) of EPCA (42 U.S.C. 6317(b)(1)) mandates the
Department to determine whether energy conservation standards for small
motors would result in ``significant energy savings.'' NEMA commented
that energy conservation standards for the considered small motors are
not likely to save the threshold amount of one quad. (NEMA, No. 1 at p.
1) While the term ``significant'' is not defined in the Act, the U.S.
Court of Appeals, in Natural Resources Defense Council v. Herrington,
768 F.2d 1355, 1373 (D.C. Cir. 1985), indicated that Congress intended
``significant'' energy savings in a similar context in section 325 of
the Act (42 U.S.C. 6295(o)(3)(B)) to be savings that were not
``genuinely trivial.'' Using the Department's analysis of design
options, the estimated energy savings of 0.61 to 0.78 quad over a 20-
year period for the considered small motors are comparable to those the
Department found to be significant for room air conditioners, where
energy savings projected to result from standards ranged from 0.36 to
0.96 quad over a 30-year period. 62 FR 50122, 50142 (September 24,
1997). The Department believes that the estimated energy savings for
the considered small motors are not ``genuinely trivial,'' and are, in
fact, ``significant.''
2. Impact on Consumers
Section 346(b)(1) of EPCA requires that energy conservation
standards for small motors be economically justified (42 U.S.C.
6317(b)(1)). Using the methods and data described in section II.B., the
Department conducted an LCC analysis to estimate the net benefits to
users from increased efficiency in the considered small motors. The
Department then aggregated the results from the LCC analysis to the
national level to estimate national energy savings and national
economic impacts. Given the results on energy savings and economic
benefits, the Department concluded that there is also likely to be
reduced emissions from decreased electricity generation, decreased
demand for the construction of electricity power plants, and
potentially net indirect employment benefits from shifting expenditures
from the capital-intensive utility sector to consumer expenditures.
While the Department did not quantify these potential benefits, it
concluded that the benefits are likely to be positive based on the
results of the Department's analyses regarding energy conservation
standards for similar products. The Department will provide detailed
estimates of such impacts as part of the standards rulemaking process
that will result from this determination.
III. Conclusion
A. Determination
Based on its analysis of the information now available, the
Department has determined that energy conservation standards for
certain small electric motors appear to be technologically feasible and
economically justified, and are likely to result in significant energy
savings. Consequently, the Department will initiate the development of
energy-efficiency test procedures and standards for certain small
electric motors.
All design options addressed in today's determination notice are
technologically feasible. Th
