Energy Conservation Program: Energy Conservation Standards for Certain Consumer Products (Dishwashers, Dehumidifiers, Microwave Ovens, and Electric and Gas Kitchen Ranges and Ovens) and for Certain Commercial and Industrial Equipment (Commercial Clothes Washers), 16040-16096 [E9-7545]
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16040
Federal Register / Vol. 74, No. 66 / Wednesday, April 8, 2009 / Rules and Regulations
DEPARTMENT OF ENERGY
10 CFR Part 430
[Docket Number: EERE–2006–STD–0127]
RIN 1904–AB49
Energy Conservation Program: Energy
Conservation Standards for Certain
Consumer Products (Dishwashers,
Dehumidifiers, Microwave Ovens, and
Electric and Gas Kitchen Ranges and
Ovens) and for Certain Commercial
and Industrial Equipment (Commercial
Clothes Washers)
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AGENCY: Office of Energy Efficiency and
Renewable Energy, Department of
Energy.
ACTION: Final rule.
SUMMARY: The Department of Energy
(DOE) is announcing that it is amending
energy conservation standards
pertaining to the cooking efficiency of
residential gas kitchen ranges and
ovens, because it has determined that
such standards would be
technologically feasible and
economically justified and would result
in significant conservation of energy,
the three primary statutory criteria for
adoption of standards under the Energy
Policy and Conservation Act (EPCA).
DOE is not adopting energy
conservation standards pertaining to the
cooking efficiency of residential electric
kitchen ranges and ovens and
microwave ovens, because it has
determined that such standards would
not be technologically feasible and
economically justified. At this point,
DOE has decided to defer its decision
regarding adoption of amended energy
conservation standards for the energy
efficiency of commercial clothes
washers and standby mode and off
mode power consumption by
microwave ovens, pending further
rulemaking. Finally, DOE is not
adopting amended standards for
dishwashers and dehumidifiers in this
rulemaking, because recent amendments
to EPCA have already set standards for
those products.
DATES: The effective date of this rule is
June 8, 2009. Compliance with the
standards set by today’s final rule is
required on April 9, 2012.
ADDRESSES: For access to the docket to
read background documents, the
technical support document, transcripts
of the public meetings in this
proceeding, or comments received, visit
the U.S. Department of Energy, Resource
Room of the Building Technologies
Program, 950 L’Enfant Plaza, SW., 6th
Floor, Washington, DC 20024, (202)
586–2945, between 9 a.m. and 4 p.m.,
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Monday through Friday, except Federal
holidays. Please call Ms. Brenda
Edwards at the above telephone number
for additional information regarding
visiting the Resource Room. You may
also obtain copies of certain previous
rulemaking documents in this
proceeding (i.e., framework document,
advance notice of proposed rulemaking,
notice of proposed rulemaking), draft
analyses, public meeting materials, and
related test procedure documents from
the Office of Energy Efficiency and
Renewable Energy’s Web site at https://
www1.eere.energy.gov/buildings/
appliance_standards/residential/
cooking_products.html
FOR FURTHER INFORMATION CONTACT: Mr.
Stephen Witkowski, U.S. Department of
Energy, Office of Energy Efficiency and
Renewable Energy, Building
Technologies Program, EE–2J, 1000
Independence Avenue, SW.,
Washington, DC 20585–0121.
Telephone: (202) 586–7463. E-mail:
Stephen.Witkowski@ee.doe.gov.
Mr. Eric Stas or Mr. Michael Kido,
U.S. Department of Energy, Office of the
General Counsel, GC–72, 1000
Independence Avenue, SW.,
Washington, DC 20585–0121.
Telephone: (202) 586–9507. E-mail:
Eric.Stas@hq.doe.gov or
Michael.Kido@hq.doe.gov.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Summary of the Final Rule
A. The Standard Levels
1. Statutorily Set Standard Levels for
Dehumidifiers and Dishwashers
2. The Standard Levels for the Energy
Efficiency of Residential Cooking
Products
3. Further Rulemaking for Commercial
Clothes Washers and Microwave Ovens
B. Current Federal Standards
C. Benefits and Burdens to Purchasers of
Cooking Products
D. Impact on Manufacturers
E. National Benefits
F. Conclusion
II. Introduction
A. Authority
B. Background
1. Current Standards
2. History of Standards Rulemaking for the
Two Appliance Products
3. Further Rulemaking To Consider Energy
Conservation Standards for Microwave
Oven Standby Mode and Off Mode
Power Use and for Commercial Clothes
Washers
III. General Discussion
A. Standby Power for Cooking Products
B. Test Procedures
C. Technological Feasibility
1. General
2. Gas Cooking Products—Alternatives to
Line-Powered Electronic Ignition
Systems
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3. Maximum Technologically Feasible
Levels
D. Energy Savings
E. Economic Justification
1. Specific Criteria
a. Economic Impact on Consumers and
Manufacturers
b. Life-Cycle Costs
c. Energy Savings
d. Lessening of Utility or Performance of
Products
e. Impact of Any Lessening of Competition
f. Need of the Nation to Conserve Energy
2. Rebuttable Presumption
IV. Methodology and Discussion of
Comments on Methodology
A. Market and Technology Assessment
1. Product Classes
2. Technology Options
3. Excluded Product Classes and
Technologies
B. Engineering Analysis
1. Efficiency Levels
2. Manufacturing Costs
C. Life-Cycle Cost and Payback Period
Analyses
1. Product Prices
2. Installation Cost
3. Annual Energy Consumption
4. Energy Prices
5. Repair and Maintenance Costs
6. Product Lifetime
7. Discount Rates
8. Effective Date of the Amended Standards
9. Product Energy Efficiency in the Base
Case
10. Inputs to Payback Period Analysis
11. Rebuttable Presumption Payback
Period
D. National Impact Analysis—National
Energy Savings and Net Present Value
1. General
2. Shipments
a. New Construction Shipments
b. Replacements
c. Purchase Price, Operating Cost, and
Household Income Impacts
d. Fuel Switching
3. Other Inputs
a. Base-Case Forecasted Efficiencies
b. Standards-Case Forecasted Efficiencies
c. Annual Energy Consumption
d. Site-to-Source Conversion
e. Total Installed Costs and Operating Costs
f. Discount Rates
g. Effects of Standards on Energy Prices
E. Consumer Subgroup Analysis
F. Manufacturer Impact Analysis
G. Employment Impact Analysis
H. Utility Impact Analysis
I. Environmental Assessment
V. Discussion of Other Comments
A. Burdens and Benefits
1. Consideration of the Value of Avoided
Environmental Impacts
B. Other Comments
1. Proposed Standards for Conventional
Cooking Products
VI. Analytical Results and Conclusions
A. Trial Standard Levels
B. Significance of Energy Savings
C. Economic Justification
1. Economic Impact on Consumers
a. Life-Cycle Costs and Payback Period
b. Consumer Subgroup Analysis
2. Economic Impact on Manufacturers
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a. Industry Cash-Flow Analysis Results
b. Impacts on Manufacturer Employment
c. Impacts on Manufacturers That Are
Small Businesses
d. Cumulative Regulatory Burden
3. Net Present Value of Consumer Impacts
and National Employment Impacts
4. Impact on Utility or Performance of
Products
5. Impact of Any Lessening of Competition
6. Need of the Nation To Conserve Energy
D. Conclusion
1. Overview
2. Conventional Cooking Products
3. Microwave Ovens
VII. Procedural Issues and Regulatory Review
A. Review Under Executive Order 12866
B. Review Under the Regulatory Flexibility
Act
1. Reasons for the Final Rule
2. Objectives of, and Legal Basis for, the
Rule
3. Description and Estimated Number of
Small Entities Regulated
4. Description and Estimate of Compliance
Requirements
5. Significant Issues Raised by Public
Comments
6. Steps DOE Has Taken To Minimize the
Economic Impact on Small
Manufacturers
C. Review Under the Paperwork Reduction
Act
D. Review Under the National
Environmental Policy Act
E. Review Under Executive Order 13132
F. Review Under Executive Order 12988
G. Review Under the Unfunded Mandates
Reform Act of 1995
H. Review Under the Treasury and General
Government Appropriations Act, 1999
I. Review Under Executive Order 12630
J. Review Under the Treasury and General
Government Appropriations Act, 2001
K. Review Under Executive Order 13211
L. Review Under the Information Quality
Bulletin for Peer Review
M. Congressional Notification
VIII. Approval of the Office of the Secretary
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I. Summary of the Final Rule
A. The Standard Levels
DOE notes that this rulemaking
originally bundled four separate
residential and commercial products
(dishwashers, dehumidifiers, electric
and gas kitchen ranges and ovens and
microwave ovens, and commercial
clothes washers). However, as explained
in further detail below, various events
occurred during the course of the
rulemaking which resulted in the
consideration of a number of these
products separately. For example,
Congress set efficiency levels by statute
for dishwashers and dehumidifiers,
which DOE codified in its regulations
through a separate rulemaking (along
with numerous other statutory changes).
At the notice of proposed rulemaking
(NOPR) stage, public commenters made
DOE aware of problems with the
efficiency data for certain commercial
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clothes washer models upon which DOE
had relied in its analyses. For
microwave ovens, public commenters
urged DOE to await the impending
finalization of the industry standard for
measurement of microwave oven
standby mode and off mode power
consumption before adopting a
corresponding DOE test procedure (a
prerequisite for an energy conservation
standard addressing standby power).
DOE believes that both of these
developments warrant further
rulemaking action. For these reasons,
today’s final rule is limited to
addressing energy conservation
standards for the cooking efficiency of
electric and gas kitchen ranges and
ovens and microwave ovens.
1. Statutorily Set Standard Levels for
Dehumidifiers and Dishwashers
As explained in detail in the NOPR in
this proceeding, the Energy Policy and
Conservation Act, as amended (42
U.S.C. 6291 et seq.; EPCA or the Act),
initially contained energy conservation
standards for dehumidifiers and
residential dishwashers, as well as
requirements for DOE to amend those
standards, and DOE announced it would
consider such amendments to those
standards in this rulemaking. 73 FR
62034, 62036–40 (Oct. 17, 2008) (the
October 2008 NOPR). However, the
Energy Independence and Security Act
of 2007 (EISA 2007), Public Law No.
110–40, subsequently amended these
EPCA provisions in two ways pertinent
here. First, EISA 2007 prescribed
efficiency standards for dehumidifiers
manufactured on or after October 1,
2012 and removed the requirement for
a rulemaking to amend the EPCA
standards for this product. Second,
EISA 2007 prescribed maximum energy
and water use levels for residential
dishwashers manufactured on or after
January 1, 2010, and required
completion of a final rule no later than
January 1, 2015 to consider amendment
of these dishwasher standards. 73 FR
62034, 62038–40 (Oct. 17, 2008). (EISA
2007, section 311(a)(1)–(2); 42 U.S.C.
6295(g)(10) and (cc)) DOE notes that
although EISA 2007 did not formally
remove the requirement to conduct the
current rulemaking, the statutory
standards for dishwashers are to become
effective well before the effective date of
any amended standards that would have
arisen from the present rulemaking.
Consequently, DOE has not conducted
further analysis in this rulemaking of
standards for dehumidifiers and
residential dishwashers. 73 FR 62034,
62040 (Oct. 17, 2008). Instead, DOE has
incorporated into its regulations all of
the energy conservation standards
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16041
prescribed by EISA 2007 for various
products and equipment, including
those for dehumidifiers and residential
dishwashers, in a separate rulemaking
notice. 74 FR 12058 (March 23, 2009).
2. The Standard Levels for the Energy
Efficiency of Residential Cooking
Products
Pursuant to EPCA, any amended
energy conservation standard that DOE
prescribes for cooking products 1 or
commercial clothes washers
(collectively referred to in this final rule
as ‘‘the two appliance products’’) must
be designed to ‘‘achieve the maximum
improvement in energy efficiency * * *
which the Secretary determines is
technologically feasible and
economically justified.’’ (42 U.S.C.
6295(o)(2)(A) and 6316(a)) Furthermore,
the new standard must ‘‘result in
significant conservation of energy.’’ (42
U.S.C. 6295(o)(3)(B) and 6316(a)) In
today’s final rule, DOE has decided to
adopt amended energy conservation
standards pertaining to the cooking
efficiency of residential gas kitchen
ranges and ovens pursuant to these
criteria. Today’s final rule requires that
residential gas kitchen ranges and ovens
without an electrical supply cord
manufactured after April 9, 2012 must
not be equipped with a constant burning
pilot light. DOE has decided not to
adopt energy conservation standards
pertaining to the cooking efficiency of
residential electric kitchen ranges and
ovens and microwave ovens. As
explained in further detail below, no
cooking efficiency standards for these
products were found to be
technologically feasible and
economically justified.
3. Further Rulemaking for Commercial
Clothes Washers and Microwave Ovens
DOE has decided to defer its decision
regarding whether to adopt amended
energy conservation standards for the
energy efficiency of commercial clothes
washers (CCWs) and for the standby
mode and off mode power consumption
of microwave ovens, pending further
rulemaking. The reasons for DOE’s
decision are summarized below.
In the October 2008 NOPR, DOE
tentatively concluded for CCWs that a
standard of 1.76 modified energy factor
(MEF) and 8.3 water consumption factor
(WF) for top-loading CCWs and a
standard of 2.0 MEF and 5.5 WF for
front-loading CCWs are technologically
feasible and economically justified. 73
FR 62034, 62036 (Oct. 17, 2008). As
1 The term ‘‘cooking products’’ as used in this
notice refers to residential electric and gas kitchen
ranges and ovens, including microwave ovens.
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discussed in more detail in section
II.B.3, DOE received comments on the
October 2008 NOPR that questioned the
validity of the maximum
technologically feasible (max-tech) level
that was used in the analysis of toploading CCWs. DOE has concluded that
additional information is required to
verify whether the max-tech level
specified in the NOPR is appropriate.
Likewise, the October 2008 NOPR
tentatively concluded that a standard for
microwave oven standby mode and off
mode energy consumption would be
technologically feasible and
economically justified. Therefore,
concurrent with the standards NOPR,
DOE published in the Federal Register
a test procedure NOPR for microwave
ovens to provide for the measurement of
standby mode and off mode power
consumption by these products. 73 FR
61134 (Oct. 17, 2008). As discussed in
section II.B.3, DOE received comments
on the October 2008 NOPR that objected
to certain definitions that were included
in the proposed microwave oven test
procedure amendments. The
commenters supported the
incorporation of definitions provided in
a revision of an industry standard for
measuring standby power consumption
expected to be completed later this year.
DOE has concluded that it should defer
consideration of microwave oven energy
conservation standards until the revised
industry standard becomes available for
consideration in the microwave oven
test procedure amendments.
DOE intends to complete the
rulemaking process for these products
and equipment as expected once
additional key data and information
become available, keeping in mind the
relevant statutory deadlines. As
discussed in the October 2008 NOPR, 73
FR 62034, 62041 (Oct. 17, 2008), the
EISA 2007 amendments to EPCA require
DOE to amend the ranges and ovens and
microwave oven test procedure to
incorporate standby and off mode
energy consumption no later than
March 31, 2011. (42 U.S.C.
6295(gg)(2)(B)(vi)) For CCWs, EPCA
requires that DOE issue a final rule by
January 1, 2010, to determine whether
the existing energy conservation
standards should be amended. (42
U.S.C. 6313(e)(2)(A))
B. Current Federal Standards
DOE established the current energy
conservation standards for dishwashers
manufactured on or after May 14, 1994,
in a final rule published in the Federal
Register on May 14, 1991 (56 FR 22250).
These standards include a requirement
that the energy factor (EF) of a standardsize dishwasher must not be less than
0.46 cycles per kilowatt-hour (kWh) and
that the EF of a compact-size
dishwasher must not be less than 0.62
cycles per kWh. (10 CFR 430.32(f))
Section 311(a)(2) of EISA 2007
established maximum energy and water
use levels for dishwashers
manufactured on or after January 1,
2010. (42 U.S.C. 6295(g)(10)) Under the
amended statute, a standard-size
dishwasher shall not exceed 355 kWh/
year and 6.5 gallons of water per cycle,
and a compact-size dishwasher shall not
exceed 260 kWh/year and 4.5 gallons of
water per cycle.
EPCA, as amended by the Energy
Policy Act of 2005 (EPACT 2005),
Public Law 109–58, prescribes the
current energy conservation standard for
dehumidifiers, shown in Table I.1. (42
U.S.C. 6295(cc)(1); 10 CFR 430.32(v))
Section 311(a)(1) of EISA 2007 amended
EPCA to prescribe minimum efficiency
levels for dehumidifiers manufactured
on or after October 1, 2012. (42 U.S.C.
6295(cc)(2))
TABLE I.1—FEDERAL STANDARDS FOR RESIDENTIAL DEHUMIDIFIERS
EPACT 2005 standards effective October 1, 2007
Dehumidifier capacity
pints/day
EF
liters/kWh
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25.00 or less .................................................................
25.01–35.00 ..................................................................
35.01–54.00 ..................................................................
54.01–74.99 ..................................................................
75.00 or more ...............................................................
EPCA prescribes the current energy
conservation standard for cooking
products, which includes a requirement
that gas ranges and ovens with an
electrical supply cord that are
manufactured on or after January 1,
1990, not be equipped with a constant
burning pilot light. (42 U.S.C.
6295(h)(1); 10 CFR 430.32(j)) Currently,
no mandatory Federal energy
conservation standards exist for
conventional electric ranges and ovens
or for microwave ovens.
EPCA also prescribes standards for
CCWs manufactured on or after January
1, 2007, requiring that CCWs have an
MEF of at least 1.26 and a WF of not
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EISA 2007 standards effective October 1, 2012
1.00
1.20
1.30
1.50
2.25
Dehumidifier capacity
pints/day
Up to 35.00 ...................................................................
35.01–45.00 ..................................................................
45.01–54.00 ..................................................................
54.01–75.00 ..................................................................
Greater than 75.00 .......................................................
more than 9.5. (42 U.S.C. 6313(e)(1); 10
CFR 431.156)
C. Benefits and Burdens to Purchasers
of Cooking Products
In the October 2008 NOPR, DOE
considered the impacts on consumers of
several trial standard levels (TSLs)
related to the cooking efficiency of
conventional cooking products and
microwave ovens. 73 FR 62034, 62037,
62084–90 (Oct. 17, 2008). In the October
2008 NOPR, DOE tentatively concluded
that none of the TSLs for microwave
oven cooking efficiency were
economically justified. 73 FR 62034,
62119 (Oct. 17, 2008). DOE has reached
the same conclusion in today’s final
rule. Therefore, at this time, DOE is not
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EF
liters/kWh
1.35
1.50
1.60
1.70
2.5
adopting standards for microwave oven
cooking efficiency (EF), so there will be
no positive or negative impacts on
purchasers of these products.
Also in the October 2008 NOPR, DOE
determined that at TSL 1, the economic
impacts (i.e., the average life-cycle cost
(LCC) savings) on consumers of the
proposed standards for conventional
cooking products would be positive.
(TSL 1 prohibits constant burning pilots
for gas appliances but does not change
standards for the other product classes.)
DOE has reached the same conclusion
in today’s final rule. Table I.2 presents
the impacts on consumers of the energy
conservation standards adopted in
today’s final rule.
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16043
TABLE I.2—IMPLICATIONS OF AMENDED STANDARDS FOR CONSUMERS
Gas cooktops
New average installed cost ...............................................................................................................................
Estimated installed cost increase ......................................................................................................................
Lifetime operating cost savings .........................................................................................................................
Average payback period ....................................................................................................................................
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The typical baseline gas cooktop has
an installed price of $310 and an
average lifetime operating cost of $561,
resulting in a total life-cycle cost of
$871. To meet the new standards, DOE
estimates that the installed price of this
product will be $332, an increase of $22.
This price increase will be offset by
lifetime operating cost savings of $37,
resulting in life-cycle cost savings of
$15. For gas standard ovens, the typical
baseline product has an installed price
of $430 and an annual average lifetime
operating cost of $406, resulting in a
total life-cycle cost of $836. To meet the
new standards, DOE estimates that the
installed price of this product will be
$464, an increase of $34. This price
increase will be offset by lifetime
operating cost savings of $43, resulting
in life-cycle cost savings of $9.
For the subgroup of consumers who
do not have access to the electrical grid
or whose religious and cultural
practices prohibit the use of grid
electricity, the amended standards
would require use of technologies (e.g.,
a battery-powered spark-ignition device)
that have not yet been certified to meet
applicable safety standards. See 42
U.S.C. 6295(o)(2)(B)(i)(VII) and 10 CFR
part 430, subpart C, appendix A,
sections 4(a)(4)(i) and (iv), and 5(b)(1)
and (4). (See sections III.C.2 and VI.D.2
of this notice for further discussion.)
Based on its research, DOE expects that
certification of such technologies under
applicable safety standards will likely
be completed when these standards
become effective.
D. Impact on Manufacturers
Using a real corporate discount rate of
7.2 percent, DOE estimates the industry
net present value (INPV) in 2006$ of the
gas cooktop, gas oven, and microwave
oven industries to be $288 million, $469
million, and $1.46 billion, respectively,
in the absence of new or amended
standards. DOE estimates the impact of
the cooking efficiency standards
adopted in today’s final rule on the
INPV of manufacturers of these products
to be between a 1.73-percent loss and a
4.11-percent loss (¥$5 million to ¥$12
million) for gas cooktop manufacturers
and between a 1.56-percent loss and a
2.10-percent loss (¥$7 million to ¥$10
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million) for gas oven manufacturers.
Because DOE is not adopting standards
for cooking efficiency of conventional
electric cooking products or microwave
ovens (and because consideration of a
standby mode and off mode standard for
microwave ovens has been deferred),
this final rule will have no net impact
on manufacturers of these products.
Based on DOE’s interviews with
manufacturers of cooking products and
on comments received on the October
2008 NOPR, DOE determined that two
small businesses that manufacture gas
cooking products could be
disproportionately affected by
standards. (See section VII.B of this
notice for further discussion.)
E. National Benefits
DOE estimates the standards will save
approximately 0.14 quads (quadrillion
(1015) British thermal units (BTU)) of
energy over 30 years (2012–2042). This
is equivalent to 2.9 days of U.S. gasoline
use.
By 2042, DOE expects the energy
savings from the standards to eliminate
the need for approximately 62
megawatts (MW) of generating
capacity.2 These energy savings will
result in cumulative (undiscounted)
greenhouse gas emission reductions of
approximately 13.7 million tons (Mt) of
carbon dioxide (CO2). Based on a
methodology developed during 2008,
these emission reductions were
estimated to represent domestic benefits
of $0 to $109 million using a 7-percent
discount rate and $0 to $241 million
using a 3-percent discount rate,
cumulative from 2012 to 2042 in 2007$.
The methodology used to develop these
estimates is now under review.
Additionally, the standards will help
alleviate air pollution by resulting in
approximately 6.1 kilotons (kt)) of
nitrogen oxides (NOX) cumulative
2 Because the amended standards affect solely
residential gas consumption, the installed power
plant generating capacity change represents only
0.005 percent of the total installed generating
capacity forecasted for the year 2030. Therefore,
both the installed capacity change and its
associated emission reductions are negligible.
Although effectively negligible, installed generation
capacity and emission impacts are still reported in
section VI of today’s final rule for TSL 1 (the
amended standards).
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$332 .................
$22 ...................
$37 ...................
3.3 years ...........
Gas standard
ovens
$464.
$34.
$43.
7.0 years.
emission reductions at the sites where
appliances are used from 2012 through
2042. In addition, the standards would
result in power plant NOX emissions
reductions of 0.6 kt from 2012 to 2042.
The total NOX emissions reductions at
these locations would be an amount
equal to $0.7 to $7.3 million using a 7percent discount rate and $1.5 to $15.4
million using a 3-percent discount rate,
in 2006$. The standards would also
possibly result in power plant mercury
(Hg) emissions reductions of up to 0.15
tons (t) from 2012 to 2042, or an amount
equal to $0 to $1.3 million using a 7percent discount rate and $0 to $2.6
million using a 3-percent discount rate,
in 2006$.
The national NPV of the standards is
$254 million using a 7-percent discount
rate and $706 million using a 3-percent
discount rate, cumulative from 2012 to
2042 in 2006$. This is the estimated
total value of future savings minus the
estimated increased equipment costs,
discounted to 2007.
The benefits and costs of today’s final
rule to the Nation can also be expressed
in terms of annualized [2006$] values
over the forecast period (2012 through
2042). Using a 7-percent discount rate
for the annualized cost analysis, the cost
of the standards established in today’s
final rule is $17 million per year in
increased product and installation costs,
while the annualized benefits are $37
million per year in reduced product
operating costs. Using a 3-percent
discount rate, the cost of the standards
established in today’s final rule is $28
million per year and the benefits are $85
million per year.
F. Conclusion
DOE has evaluated the benefits
(energy savings, consumer LCC savings,
positive national NPV, and emissions
reductions) to the Nation of amended
energy conservation standards for gas
cooking products and of new cooking
efficiency standards for conventional
electric cooking products and
microwave ovens, as well as the costs of
such standards (loss of manufacturer
INPV and consumer LCC increases for
some users of the cooking products).
Based on all available information, DOE
has determined that the benefits to the
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Nation of the standards for gas cooking
products outweigh their costs. Today’s
standards also represent the maximum
improvement in energy efficiency that is
technologically feasible and
economically justified, and will result
in significant energy savings. At present,
gas cooking products that meet the
amended standard levels are
commercially available or, for the
subgroup of consumers without access
to the electrical grid or whose religious
or cultural practices prohibit the use of
grid electricity, are likely to be
commercially available at the time the
standards become effective.
II. Introduction
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A. Authority
Title III of EPCA sets forth a variety
of provisions designed to improve
energy efficiency. Part A 3 of Title III (42
U.S.C. 6291–6309) provides for the
‘‘Energy Conservation Program for
Consumer Products Other Than
Automobiles.’’ The program covers
consumer products and certain
commercial products (all of which are
referred to hereafter as ‘‘covered
products’’), including electric and gas
kitchen ranges and ovens. (42 U.S.C.
6292(10), 6295(h)) Part A–1 4 of Title III
(42 U.S.C. 6311–6317) establishes a
similar program for ‘‘Certain Industrial
Equipment’’ (referred to hereafter as
‘‘covered equipment’’), including
commercial clothes washers. (42 U.S.C.
6312, 6313(e)) Part A of Title III
provides for test procedures, labeling,
and energy conservation standards for
residential cooking products and certain
other types of products, and it
authorizes DOE to require information
and reports from manufacturers.
The National Appliance Energy
Conservation Act of 1987 (NAECA),
Pub. L. 100–12, amended EPCA to
establish prescriptive standards for
cooking products. NAECA requires gas
ranges and ovens with an electrical
supply cord that are manufactured on or
after January 1, 1990, not to be equipped
with a constant burning pilot light, and
requires DOE to conduct two cycles of
rulemakings for ranges and ovens to
determine if the standards established
should be amended. (42 U.S.C.
6295(h)(1)–(2)) The test procedures for
cooking products appear at 10 CFR part
430, subpart B, appendix I.
DOE is conducting the present
rulemaking for cooking products
3 This part was originally titled Part B. It was
redesignated Part A in the United States Code for
editorial reasons.
4 This part was originally titled Part C. It was
redesignated Part A–1 in the United States Code for
editorial reasons.
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pursuant to the authority set forth
above. The following paragraphs discuss
some of the key provisions of EPCA
relevant to the standards-setting
rulemaking.
EPCA provides criteria for prescribing
new or amended standards for covered
products. As indicated above, any new
or amended standard for cooking
products must be designed to achieve
the maximum improvement in energy
efficiency that is technologically
feasible and economically justified. (42
U.S.C. 6295(o)(2)(A)) Additionally, DOE
may not prescribe an amended or new
standard if DOE determines by rule that
such a standard would not result in
‘‘significant conservation of energy,’’ or
‘‘is not technologically feasible or
economically justified.’’ (42 U.S.C.
6295(o)(3)(B) and 6316(a))
EPCA also provides that in deciding
whether such a standard is
economically justified for covered
products, DOE must, after receiving
comments on the proposed standard,
determine whether the benefits of the
standard exceed its burdens by
considering, to the greatest extent
practicable, the following seven factors:
1. The economic impact of the
standard on manufacturers and
consumers of the products subject to the
standard;
2. The savings in operating costs
throughout the estimated average life of
products in the type (or class) compared
to any increase in the price, initial
charges, or maintenance expenses for
the covered products that are likely to
result from the imposition of the
standard;
3. The total projected amount of
energy savings likely to result directly
from the imposition of the standard;
4. Any lessening of the utility or the
performance of the products likely to
result from the imposition of the
standard;
5. The impact of any lessening of
competition, as determined in writing
by the Attorney General, that is likely to
result from the imposition of the
standard;
6. The need for national energy
conservation; and
7. Other factors the Secretary of
Energy (Secretary) considers relevant.
(42 U.S.C. 6295(o)(2)(B)(i) and 6316(a))
In addition, EPCA, as amended (42
U.S.C. 6295(o)(2)(B)(iii) and 6316(a)),
establishes a rebuttable presumption
that any standard for covered products
is economically justified if the Secretary
finds that ‘‘the additional cost to the
consumer of purchasing a product
complying with an energy conservation
standard level will be less than three
times the value of the energy (and as
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applicable, water) savings during the
first year that the consumer will receive
as a result of the standard,’’ as
calculated under the test procedure in
place for that standard.
EPCA also contains what is
commonly known as an ‘‘antibacksliding’’ provision. (42 U.S.C.
6295(o)(1) and 6316(a)) This provision
mandates that the Secretary not
prescribe any amended standard that
either increases the maximum allowable
energy use or decreases the minimum
required energy efficiency of a covered
product. EPCA further provides that the
Secretary may not prescribe an amended
or new standard if interested persons
have established by a preponderance of
the evidence that the standard is ‘‘likely
to result in the unavailability in the
United States of any product type (or
class) of performance characteristics
(including reliability), features, sizes,
capacities, and volumes that are
substantially the same as those generally
available in the United States at the time
of the Secretary’s finding.’’ (42 U.S.C.
6295(o)(4) and 6316(a))
Section 325(q)(1) of EPCA is
applicable to promulgating standards for
any type or class of covered product that
has two or more subcategories. (42
U.S.C. 6295(q)(1) and 6316(a)) Under
this provision, DOE must specify a
different standard level than that which
applies generally to such type or class
of product for any group of products
‘‘which have the same function or
intended use, if * * * products within
such group—(A) consume a different
kind of energy from that consumed by
other covered products within such type
(or class); or (B) have a capacity or other
performance-related feature which other
products within such type (or class) do
not have and such feature justifies a
higher or lower standard’’ than applies
or will apply to the other products. (42
U.S.C. 6295(q)(1)(A) and (B)) In
determining whether a performancerelated feature justifies such a different
standard for a group of products, DOE
must consider ‘‘such factors as the
utility to the consumer of such a
feature’’ and other factors DOE deems
appropriate. (42 U.S.C. 6295(q)(1)) Any
rule prescribing such a standard must
include an explanation of the basis on
which DOE established such higher or
lower level. (See 42 U.S.C. 6295(q)(2)).
Federal energy conservation standards
for covered products generally
supersede State laws or regulations
concerning energy conservation testing,
labeling, and standards. (42 U.S.C.
6297(a)–(c) and 6316(a)) DOE can,
however, grant waivers of preemption
for particular State laws or regulations,
in accordance with the procedures and
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other provisions of section 327(d) of the
Act. (42 U.S.C. 6297(d) and 6316(a))
B. Background
1. Current Standards
As described in greater detail in the
October 2008 NOPR, 73 FR 62034,
62039–40 (Oct. 17, 2008), the current
energy conservation standards in EPCA
for dishwashers apply to all products
manufactured on or after May 14, 1994
(10 CFR 430.32(f)); for dehumidifiers, to
all products manufactured on or after
October 1, 2007 (42 U.S.C. 6295(cc)(1);
10 CFR 430.32(v)); for cooking products,
to all products manufactured on or after
January 1, 1990, (42 U.S.C. 6295(h)(1);
10 CFR 430.32(j)); and for CCWs to all
equipment manufactured on or after
January 1, 2007 (42 U.S.C. 6313(e)(1); 10
CFR 431.156). In addition, EISA 2007
established standards for dishwashers
manufactured on or after January 1,
2010 (42 U.S.C. 6295(g)(10)) and for
dehumidifiers manufactured on or after
October 1, 2012 (42 U.S.C. 6295(cc)(2)).
These standards are discussed in section
I.B.
2. History of Standards Rulemaking for
the Two Appliance Products
As noted above, this rulemaking
originally bundled four products
(dishwashers, dehumidifiers, residential
cooking products, and commercial
clothes washers). However, during the
course of this rulemaking, Congress set
energy conservation standard levels by
statute for dishwashers and
dehumidifiers as part of EISA 2007.
Accordingly, the regulatory history
provided below focuses on the two
remaining appliance products—
residential cooking products and
commercial clothes washers.
NAECA amended EPCA to establish
the current prescriptive standard
requiring gas ranges and ovens with an
electrical supply cord not to be
equipped with a constant burning pilot
light. (42 U.S.C. 6295(h)(1)) In a
rulemaking undertaken pursuant to
EPCA (42 U.S.C. 6295(h)(2)), DOE
issued a final rule in which it found that
standards were not justified for electric
cooking products and, partially due to
the difficulty of conclusively
demonstrating the economic impacts of
standards for gas-fired ranges and ovens,
did not include amended standards for
gas-fired ranges and ovens in the final
rule. 63 FR 48038 (Sept. 8, 1998).
Section 136(a) and (e) of the Energy
Policy Act of 2005 (EPACT 2005),
Public Law 109–58, amended EPCA to
add CCWs as covered equipment,
establish the current standards for such
equipment, and require that DOE do two
cycles of rulemakings to determine
whether these standards should be
amended. (42 U.S.C. 6311(1) and
6313(e)) DOE has incorporated these
standards into its regulations. 70 FR
60407, 60416 (Oct. 18, 2005); 10 CFR
431.156.
DOE commenced this rulemaking on
March 15, 2006, by publishing its
framework document for the
rulemaking, and then gave notice of a
public meeting and of the availability of
the document. 71 FR 15059 (March 27,
2006). The framework document
described the approaches DOE
anticipated using and issues to be
resolved in the rulemaking. DOE held
the public meeting on April 27, 2006, to
present the contents of the framework
document, describe the analyses DOE
planned to conduct during the
rulemaking, obtain public comment on
these subjects, and facilitate the public’s
involvement in the rulemaking. DOE
also allowed the submission of written
statements after the public meeting. In
response, DOE received 11 written
statements.
On December 4, 2006, DOE posted
two spreadsheet tools for this
rulemaking on its Web site. The tools
included calculation of the impacts of
the candidate standard levels developed
for the two appliance products. One tool
calculates LCC and payback periods
(PBPs); the other—the National Impact
Analysis (NIA) Spreadsheet—calculates
shipments, national energy savings
(NES), and NPV.
16045
On November 15, 2007, DOE
published an advance notice of
proposed rulemaking (ANOPR) in this
proceeding. 72 FR 64432 (November
2007 ANOPR). In the November 2007
ANOPR, DOE described and sought
comment on the analytical framework,
models, and tools that DOE was using
to analyze the impacts of energy
conservation standards for the relevant
appliance products. In addition, DOE
published on its Web site the complete
ANOPR technical support document
(TSD), which included the results of
DOE’s preliminary analyses in this
rulemaking. In the November 2007
ANOPR, DOE requested oral and written
comments on these preliminary results
and on a range of other issues, including
the measurement of microwave oven
standby power consumption and
potential CCW product classes. DOE
held a public meeting in Washington,
DC, on December 13, 2007, to present
the methodology and results of the
ANOPR analyses, and to receive oral
comments from those who attended.
The oral and written comments DOE
received focused on DOE’s assumptions,
approach, and analytical results, and
were addressed in detail in the October
2008 NOPR.
In the October 2008 NOPR, DOE
proposed new energy conservation
standards for the two appliance
products. 73 FR 62034, 62134 (Oct. 17,
2008). It also provided additional
background information on the history
of this rulemaking. Id. at 62040–41. In
conjunction with the October 2008
NOPR, DOE also published on its Web
site the complete TSD for the proposed
rule, which incorporated the analyses
DOE conducted and technical
documentation for each analysis. The
LCC spreadsheets, national impact
analysis spreadsheets, Government
Regulatory Impact Model (GRIM)
spreadsheets, and regulatory impact
analysis (RIA) spreadsheets are also
available on DOE’s Web site.5 The
standards proposed for the two
appliance products are presented in
Table II.1.
TABLE II.1—OCTOBER 2008 PROPOSED ENERGY EFFICIENCY STANDARDS
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Product class
Proposed energy conservation standards
Kitchen ranges and ovens:
Gas cooktops/conventional burners ....................................................................................
Electric cooktops/low or high wattage open (coil) elements ...............................................
Electric cooktops/smooth elements .....................................................................................
Gas ovens/standard oven ...................................................................................................
Gas ovens/self-clean oven ..................................................................................................
Electric ovens ......................................................................................................................
5 Available online at DOE’s Web site: https://
www1.eere.energy.gov/buildings/
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No
No
No
No
No
No
constant burning pilot lights.
standard.
standard.
constant burning pilot lights.
change to existing standard.
standard.
appliance_standards/residential/
home_appl_analysis.html.
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TABLE II.1—OCTOBER 2008 PROPOSED ENERGY EFFICIENCY STANDARDS—Continued
Product class
Proposed energy conservation standards
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Microwave ovens .................................................................................................................
Commercial clothes washers:
Top-loading commercial clothes washers ...........................................................................
Front-loading commercial clothes washers .........................................................................
In the October 2008 NOPR, DOE
discussed and invited comment
specifically on the following topics: (1)
The proposed standards for residential
gas kitchen ranges and ovens,
microwave ovens, and CCWs, as well as
DOE’s tentative conclusion that
standards for residential electric kitchen
ranges and ovens other than microwave
ovens and gas self-cleaning ovens are
not technologically feasible and
economically justified; (2) whether
battery-powered spark ignition modules
are a viable alternative to standing pilots
for manufacturers of gas ranges, ovens,
and cooktops; (3) the technical
feasibility of incorporating microwave
oven cooking efficiency with standby
mode and off mode power into a single
metric for the purpose of developing
energy conservation standards; (4) input
and data regarding off mode power for
microwave ovens; (5) input and data on
the utility provided by specific features
that contribute to microwave oven
standby power, particularly display
technologies and cooking sensors that
do not require standby power; (6) input
and data on control strategies available
to allow manufacturers to make design
tradeoffs between incorporating
standby-power-consuming features such
as displays or cooking sensors and
including a function to turn power off
to these components during standby
mode, as well as on the viability and
cost of microwave oven control board
circuitry that could accommodate
transistors to switch off cooking sensors
and displays; (7) whether switching or
similar modern power supplies can
operate successfully inside a microwave
oven and the associated efficiency
impacts on standby power; (8) the
selection of microwave oven standby
standard levels for the engineering
analysis; (9) input and data on the
estimated incremental manufacturing
costs, the assumed approaches to
achieve each standby level for
microwave ovens, and whether any
intellectual property or patent
infringement issues are associated with
the design options presented in the TSD
to achieve each standby level; (10) input
and data on the estimated market share
of microwave ovens at different standby
power consumption levels; (11) the
appropriateness of using other discount
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Maximum standby power = 1.0 watt.
1.76 Modified Energy Factor/8.3 Water Factor.
2.00 Modified Energy Factor/5.5 Water Factor.
rates in addition to 7 percent and 3
percent real to discount future
emissions reductions; and (12) the
determination of the anticipated
environmental impacts of the proposed
rule, particularly with respect to the
methods for valuing the expected
carbon dioxide (CO2) and oxides of
nitrogen (NOX) emissions savings due to
the proposed standards. 73 FR 62034,
62133 (Oct. 17, 2008).
In addition to these topics on which
it requested comment specifically, DOE
addressed four topics in the October
2008 NOPR: (1) The determination of
product classes for both cooking
products and CCWs; (2) the adequacy of
the residential clothes washer test
procedure for CCWs; (3) small business
impacts of the proposed cooking
products standards; and (4) impacts of
the proposed CCW standards on the
competitive landscape.
DOE held a public meeting in
Washington, DC, on November 13, 2008,
to hear oral comments on and solicit
information relevant to the proposed
rule.
3. Further Rulemaking To Consider
Energy Conservation Standards for
Microwave Oven Standby Mode and Off
Mode Power Use and for Commercial
Clothes Washers
Among the responses to the October
2008 NOPR, DOE received a number of
comments from interested parties that
presented information and arguments
for continuing the rulemaking process to
consider standards for microwave oven
standby mode and off mode power
consumption, as well as standards for
CCWs. These comments and DOE’s
response are discussed below.
Regarding microwave oven standby
mode and off mode power consumption,
interested parties raised concerns over
issues associated with the concurrent
microwave oven test procedure
rulemaking. As mentioned above and
discussed in detail in section III.B of
today’s notice, DOE proposed to amend
the microwave oven (MWO) test
procedure to incorporate by reference
specific clauses of International
Electrotechnical Commission (IEC)
Standard 62301, Household electrical
appliances—Measurement of standby
power. DOE would have adopted
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definitions for ‘‘standby mode’’ and ‘‘off
mode’’ in accordance with the EISA
2007 amendments to EPCA. 73 FR
62134 (Oct. 17, 2008) (MWO test
procedure NOPR).
The Association of Home Appliance
Manufacturers (AHAM) raised concerns
about the ‘‘robustness’’ of these
proposed microwave oven test
procedure amendments, and supported
continuing the microwave oven energy
conservation standards rulemaking to
allow additional time for DOE to collect
data and to clarify the test procedure.
(AHAM, No. 47 at pp. 3 and 5) 6
Whirlpool Corporation (Whirlpool)
stated that DOE could perform better
data gathering and analysis for a
microwave oven standby power
standard if DOE used the entire time
until the EISA 2007 deadline of March
31, 2011 for a test procedure
amendment to incorporate measurement
of standby mode and off mode power
consumption. Whirlpool and GE
Consumer & Industrial (GE) requested
that DOE halt the current microwave
oven energy conservation standards
rulemaking and work with industry to
gather and analyze more comprehensive
energy performance data. (Whirlpool,
No. 50 at pp. 1–2; GE, No. 48 at p. 2)
GE further stated that DOE’s approach to
standby mode and off mode power
consumption for microwave ovens
could have important implications for
other covered products, and that the
microwave oven energy conservation
standards rulemaking should be
postponed to allow DOE to address
standby power issues for covered
products either through negotiation or
through a rulemaking that considers
how the definition of ‘‘standby power’’
will affect all appliances, not just
microwave ovens. (GE, No. 48 at p. 4)
AHAM raised four other concerns
about the proposed microwave oven test
procedure amendments: (1) Which
microwave ovens are covered products;
(2) the incorporation of the EPCA
6 A notation in the form ‘‘AHAM, No. 47 at pp.
3 and 5’’ identifies a written comment (1) made by
AHAM; (2) recorded in document number 47 that
is filed in the docket of this rulemaking (Docket No.
EE–2006–STD–0127) and maintained in the
Resource Room of the Building Technologies
Program; and (3) which appears on pages 3 and 5
of document number 47.
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mstockstill on PROD1PC66 with RULES2
definitions for ‘‘standby mode’’ and ‘‘off
mode,’’ which AHAM claims are
outdated; (3) the conditions for standby
power testing; and (4) the test period for
measuring standby power. AHAM stated
that there is considerable confusion
regarding the definition of microwave
ovens as covered products. DOE stated
in the microwave oven test procedure
NOPR that the test procedure
amendments would apply to microwave
ovens for which the primary source of
heating energy is electromagnetic
(microwave) energy, including
microwave ovens with or without
browning thermal elements designed for
surface browning of food. The proposed
test procedure amendments would not
cover combination ovens (i.e., ovens
consisting of a single compartment in
which microwave energy and one or
more other technologies, such as
thermal or halogen cooking elements or
convection systems, contribute to
cooking the food). 73 FR 62134, 62137
(Oct. 17, 2008). AHAM stated that it had
been working to set up negotiations on
a microwave oven standby power
standard, but that confusion caused by
DOE’s definition of microwave ovens
required AHAM to cancel its efforts
until the definition is clarified. (AHAM,
No. 47 at p. 3) Whirlpool concurred that
the definition of microwave ovens needs
to be clarified. It claimed that DOE
appears to be creating a new product
definition without properly engaging
interested parties. (Whirlpool, Public
Meeting Transcript, No. 40.5 at p. 29;
Whirlpool, No. 50, at pp. 1–2) 7
The Appliance Standards Awareness
Project (ASAP) commented that it
appreciates DOE accelerating
development of the microwave oven test
procedure ahead of the EISA 2007
deadline of 2011 so that standby power
savings can be captured in this round of
rulemaking for cooking products.
(ASAP, Public Meeting Transcript, No.
40.5 at p. 32)
Regarding definitions of ‘‘standby
mode’’ and ‘‘off mode,’’ AHAM and
Whirlpool recognize that DOE is using
the definitions provided under the EISA
2007 amendments to EPCA, but stated
that DOE should consider IEC’s recent
7 A notation in the form ‘‘Whirlpool, Public
Meeting Transcript, No. 40.5 at p. 29’’ identifies an
oral comment that DOE received during the
November 13, 2008, NOPR public meeting, was
recorded in the public meeting transcript in the
docket for this rulemaking (Docket No. EE–2006–
STD–0127), and is maintained in the Resource
Room of the Building Technologies Program. This
particular notation refers to a comment (1) made by
Whirlpool during the public meeting; (2) recorded
in document number 40.5, which is the public
meeting transcript that is filed in the docket of this
rulemaking; and (3) which appears on page 29 of
document number 40.5.
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17:28 Apr 07, 2009
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work in developing the second edition
of IEC Standard 62301, particularly the
clarifications of the definitions of
‘‘standby mode’’ and ‘‘off mode.’’
AHAM cited the case in which a
microwave oven would be plugged in
and only energize a light-emitting diode
(LED) or some other indication that the
unit is in ‘‘off mode.’’ AHAM
commented that this would represent a
different way for the product to
communicate with the consumer that
might not be covered under the
proposed mode definitions. (AHAM,
Public Meeting Transcript, No. 40.5 at
pp. 58–60; Whirlpool, Public Meeting
Transcript, No. 40.5 at pp. 60–61) In
contrast, ASAP stated that the EISA
2007 language defining ‘‘standby mode’’
and ‘‘off mode’’ was reviewed and
agreed to by AHAM, and jointly
recommended by AHAM and efficiency
advocates to Congress. Therefore, ASAP
asserted that DOE has definitions that
were recommended by interested
parties. (ASAP, Public Meeting
Transcript, No. 40.5 at p. 64)
In the November 2007 ANOPR, DOE
proposed considering a single product
class for microwave ovens,
encompassing microwave ovens with
and without browning (thermal)
elements. This product class did not
include microwave ovens that
incorporate convection systems. DOE
stated that it was unaware of any data
evaluating the efficiency characteristics
of microwave ovens incorporating
convection systems, and sought
comments and information that would
help it evaluate the performance of such
products. 72 FR 64432, 64445, 64513
(Nov. 15, 2007). AHAM commented in
response that the single product class
should be broken up into subcategories
according to features that may be
different than when the standard was
first put into effect. 73 FR 62034, 62049
(Oct. 17, 2008). However, in the October
2008 NOPR, DOE concluded, based on
data supplied by AHAM and its own
testing, that no features or utilities were
uniquely correlated with efficiency that
would warrant defining multiple
product classes for microwave ovens. Id.
Therefore, for the purposes of the NOPR
analyses, DOE retained a single product
class for microwave ovens. No
additional data or information was
submitted in response to the October
2008 NOPR that would justify amending
the definition of the microwave oven
product class.
DOE agrees with commenters that it is
beneficial to harmonize, where possible,
its standards and test procedures with
those of other countries and
international agencies, particularly in
the area of standby power. DOE
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16047
recognizes that IEC Standard 62301 is
an internationally accepted test
standard for the measurement of
standby power in residential appliances,
and that it would be beneficial to many
manufacturers to be required to meet
only a single standby power standard
because they produce microwave ovens
for markets in multiple countries. In
considering a standby power standard
for microwave ovens, along with
associated amendments to the
microwave oven test procedure, DOE
proposed to incorporate language for
definitions of ‘‘active mode,’’ ‘‘standby
mode,’’ and ‘‘off mode’’ as provided by
the EISA 2007 amendments to EPCA.
(42 U.S.C. 6295(gg)(1)(A)) However, in
directing DOE to amend its test
procedures to address standby and off
mode power consumption, the EISA
2007 amendments to EPCA allow DOE
to amend the EPCA definitions of these
modes, while requiring that DOE take
‘‘into consideration the most current
versions’’ of IEC Standard 62301 and
IEC Standard 62087. (42 U.S.C.
6295(gg)(1)(B) and (2)(A)) In light of
these statutory provisions and
recognizing the benefits of
harmonization, DOE has decided to
continue this rulemaking, as to
microwave oven standby power
standards, until the second edition of
IEC Standard 62301 is finalized, which
is expected to occur by July 2009. At
such time, DOE will consider further
modifications to DOE’s microwave oven
test procedure, particularly the ‘‘standby
mode’’ and ‘‘off mode’’ definitions, and,
on the basis of such amended test
procedures, DOE will analyze potential
energy conservation standards for
microwave oven standby mode and off
mode energy consumption. DOE invites
data and information that will allow it
to further conduct the analysis for
standby and off mode power
consumption of microwave ovens. DOE
anticipates issuing supplemental notices
of proposed rulemaking (SNOPRs) for
microwave oven energy conservation
standards and the microwave oven test
procedure in order to obtain public
input on DOE’s updated proposals. As
part of such SNOPRs, DOE will
carefully consider and address any
microwave oven-related comments on
the October 2008 NOPR that remain
relevant.
For CCWs, interested parties raised
questions at the November 13, 2008,
NOPR public meeting and in written
comments on the max-tech level that
DOE had identified in the October 2008
NOPR for top-loading units. (See section
III.C.3 of this notice for additional
discussion of max-tech levels.)
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Specifically, at the public meeting,
Alliance Laundry Systems (Alliance)
questioned the validity of the
certification data for the CCW model on
which DOE based the max-tech level for
top-loading machines. Alliance
recommended that DOE, at a minimum,
test and confirm the performance of the
max-tech model before using it as the
basis for assessing technical feasibility
for the proposed standards. (Alliance,
Public Meeting Transcript, No. 40.5 at
pp. 90–92) GE responded that it
produces the model in question, and its
internal testing confirms that the model
meets the max-tech level. (GE, No. 48 at
pp. 4–5) GE and Alliance agreed that
there would not be consumer
acceptance of the technology required to
achieve the max-tech level (i.e., whether
CCWs incorporating advanced controls
in a lightweight, non-rugged platform
would be able to withstand the harsher
usage in a laundromat or multi-family
housing setting compared to a
residential installation). (GE, Public
Meeting Transcript, No. 40.5 at pp. 173–
174; Alliance, Public Meeting
Transcript, No. 40.5 at p. 23; Alliance,
No. 45 at p. 1; Alliance, No. 45.1 at pp.
3, 7, 13) GE stated that it had received
anecdotal consumer questions on the
water levels and clothing turnover (i.e.,
rotation of the clothing from top to
bottom in the wash basket) during the
cycle utilized by its CCW that meets the
top-loading max-tech level. According
to GE, while this CCW has achieved the
max-tech level during actual use in the
on-premises laundry segment,8 it has
not yet been justified as sustainable in
commercial laundromats where the
units are subject to much tougher
conditions, such as overloading. (GE,
No. 48 at p. 4)
The Multi-Housing Laundry
Association (MLA) commented that
there is no acceptable CCW currently
that can meet the top-loading max-tech
level presented in the October 2008
NOPR. According to MLA, previous
non-agitator CCWs that could achieve
max-tech performance have had poor
load capacity, poor wash results, and
high maintenance costs. MLA believes
that the only way to meet the max-tech
requirements would be to have either a
cold water wash or such limited
amounts of hot water that the clothes
would not be effectively cleaned.
According to MLA, to meet the maxtech requirements, water in the rinse
cycle would be so limited that some
soils, detergents, and sand would not be
removed. (MLA, No. 49 at p. 4) ASAP
stated that DOE’s conclusion in the TSD
8 This segment refers to commercial clothes
washers that are installed in multi-family housing.
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on the max-tech model (i.e., that all
higher-efficiency residential clothes
washers are impeller-type or do not
have traditional agitators) is erroneous,
commenting that there are agitator-type
residential clothes washers on the
market today that perform at higher
levels than the CCW max-tech level that
DOE has presented in the October 2008
NOPR. (ASAP, Public Meeting
Transcript, No. 40.5 at p. 203)
Whirlpool commented that the max-tech
level cannot be achieved with the
technologies implemented on current
CCW models, but it believes that
technology exists to develop such
products by the time standards would
become effective. (Whirlpool, No. 50 at
p. 3)
EPCA requires DOE to consider the
max-tech level in the analysis of
efficiency levels for CCW energy
conservation standards. (42 U.S.C.
6295(o)(2)(A) and 6316(a)) In the NOPR
analysis, DOE determined that the maxtech level for top-loading CCWs, which
was analyzed as part of TSL 3, is
technologically feasible and
economically justified. 73 FR 62034,
62122 (Oct. 17, 2008). However, the
comments submitted by Alliance in
response to the October 2008 NOPR
raised questions on the validity of the
max-tech level. (Alliance, Public
Meeting Transcript, No. 40.5 at pp. 90–
92; Alliance, No. 45 at p. 1; Alliance,
No. 45.1 at pp. 4–5) In light of this
uncertainty surrounding the
performance of the CCW model upon
which the top-loading max-tech level
was based, DOE tested several units of
that model. Preliminary results indicate
that the MEF and WF of these units are
below and above, respectively, the maxtech levels. Therefore, DOE has decided
that it will continue the CCW
rulemaking to further evaluate what an
appropriate max-tech level should be for
top-loading CCWs, and it will revise its
analyses for this product class as
necessary. DOE anticipates issuing an
SNOPR to obtain public input on DOE’s
updated proposal regarding CCW
standards. As part of such SNOPR, DOE
will carefully consider and address any
CCW-related comments on the October
2008 NOPR that remain relevant.
III. General Discussion
A. Standby Power for Cooking Products
An issue in this rulemaking has been
whether DOE should consider power
use in the standby and off modes in
adopting energy conservation standards
for cooking products. As discussed in
greater detail in the October 2008
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NOPR,9 EISA 2007 amended EPCA to
require that DOE address standby mode
and off mode energy consumption both
in adopting standards for all covered
products (for final rules for new or
amended standards adopted after July 1,
2010), including residential ranges and
ovens and microwave ovens, and in test
procedures for covered products (by
March 31, 2011, for cooking products).
(42 U.S.C. 6295(gg)) As noted above,
these provisions are not yet operative as
requirements for residential cooking
products. Id.
Nonetheless, DOE has examined in
this rulemaking whether to incorporate
standby mode and off mode power
consumption in its energy conservation
standards for residential cooking
products. 73 FR 62034, 62041 (Oct. 17,
2008). Specifically, in the October 2008
NOPR, DOE stated that it does not
intend to pursue revision of its
standards and test procedures to include
standby power use by conventional
cooking products at this time, because it
lacks data indicating the potential for
significant energy savings with respect
to such power use. Id. at 62041, 62044.
Accordingly, DOE tentatively decided to
consider test procedure amendments for
conventional cooking products in a later
rulemaking that meets the March 31,
2011, deadline set by EISA 2007 under
42 U.S.C. 6295(gg)(2)(B). 73 FR 62034,
62041, 62044 (Oct. 17, 2008).
However, DOE did state its intention
in the October 2008 NOPR to amend its
test procedure for microwave ovens to
incorporate a measurement of standby
power and to consider inclusion of such
power as part of the energy conservation
standards rulemaking for the following
reasons: (1) Energy use in this mode is
a significant proportion of microwave
oven energy consumption; and (2)
currently, the range of standby power
use among microwave ovens suggests
that a standard would result in
significant energy savings. Id. at 62041–
42. As already discussed in sections
II.B.2 and II.B.3, DOE proposed
standards for microwave oven standby
power use. Id. at 62120, 62134.
In response to the October 2008
NOPR, Whirlpool stated that no test
procedure has yet been proposed for
conventional cooking product standby
power, and that Whirlpool does not
have experience with or data available
on standby power in these products. It
further stated that DOE should request
such data promptly to allow adequate
time to develop it, noting that display
technologies will be an issue.
(Whirlpool, Public Meeting Transcript,
No. 40.5 at p. 30) DOE expects to
9 73
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FR 62034, 62041 (Oct. 17, 2008).
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evaluate standby power for
conventional cooking products in a
future test procedure rulemaking that
will meet the EPCA deadline of March
31, 2011, set forth in 42 U.S.C.
6295(gg)(2)(B). 73 FR 62034, 62041 (Oct.
17, 2008). DOE welcomes relevant data
to support this rulemaking activity.
Edison Electric Institute (EEI)
commented that standby power could
effectively be addressed in gas cooking
products with constant burning pilots
by a performance standard for the
energy consumption of the pilot, rather
than by a prescriptive standard that
would eliminate constant burning pilots
altogether. EEI argued that even though
energy savings would be reduced using
this approach, such savings could still
be fairly significant, and manufacturers
would have more flexibility in meeting
the energy conservation standards. (EEI,
Public Meeting Transcript, No. 40.5 at
pp. 19–20 and 50–51; EEI, No. 56 at p.
2)
In response, DOE notes as a
preliminary matter that it considered
EEI’s suggestion of reduced input rate
pilots as a technology option separately
in section IV.A.2. The following
responds to EEI’s suggestion to consider
an energy conservation standard for
standby power consumption of ranges
and ovens by regulating the
performance of constant burning pilots.
For standby power in conventional
cooking products, the current DOE test
procedures already provide a means for
measurement of certain standby energy
use (i.e., pilot gas consumption in gas
cooking products and clock energy
consumption in ovens), which is
included in the relevant EF metric.
However, as explained above, to
measure additional standby mode and
off mode energy use as directed by EISA
2007, DOE would need to amend the
test procedure to provide for more
comprehensive measurement of standby
mode and off mode power consumption.
As discussed above, DOE is not
contemplating revision of its standards
and test procedures to address standby
power use for conventional cooking
products at this time. DOE plans to
consider such revisions to the test
procedure in a later rulemaking which
meets the EPCA deadline of March 31,
2011. (42 U.S.C. 6295(gg)(2)(B)(vi)). DOE
will also consider standby mode and off
mode energy use in its next energy
conservation standards rulemaking, as
required by the EISA 2007 amendments
to EPCA. (42 U.S.C. 6295(gg)(3)).
Further, even if DOE were to
implement in this rulemaking the
requirements of the EISA 2007
amendments to EPCA regarding standby
mode and off mode energy use to
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conventional cooking products, DOE
would be unable to prescribe a separate
standard for pilot energy consumption
in gas cooking products. The EISA 2007
amendments require that any final rule
establishing or revising a standard for a
covered product, adopted after July 1,
2010, shall incorporate standby mode
and off mode energy use into a single
amended or new standard, if feasible. If
not feasible, the final rule shall establish
a separate standard for standby mode
and off mode energy consumption, if
justified under 42 U.S.C. 6295(o). (42
U.S.C. 6295(gg)(3)) Because gas cooking
product EF already incorporates gas
consumption of the pilot by means of
the calculation of annual energy
consumption (10 CFR 430.23(i) and 10
CFR part 430, subpart B, appendix I,
sections 4.1.2 and 4.2.2), the feasibility
of a single metric integrating both active
mode and standby mode energy use has
clearly been demonstrated. AHAM
stated that it strongly advocates, for
products other than microwave ovens,
that standby power be incorporated in
active energy standards as directed by
EISA 2007. (AHAM, No. 47 at p. 4) DOE
expects to address standby mode and off
mode power consumption in future test
procedure and standards rulemakings
for products other than microwave
ovens in accordance with the
requirements of the EISA 2007
amendments to EPCA. At such time,
DOE will determine whether standby
mode and off mode energy use can be
incorporated into a new or amended
energy conservation standard as
directed by 42 U.S.C. 6295(gg)(3).
For microwave ovens, DOE separately
considered whether it is feasible to
incorporate standby mode and off mode
energy use into a single metric. DOE
tentatively concluded in the October
2008 NOPR that although it may be
mathematically possible to combine
energy consumption into a single metric
encompassing active (cooking), standby,
and off modes, it is not technically
feasible to do so at this time because of
the high variability in the current
cooking efficiency measurement from
which the active mode EF and annual
energy consumption are derived, and
because of the significant contribution
of standby power to overall microwave
oven energy use. 73 FR 62034, 62042–
43 (Oct. 17, 2008). AHAM, Whirlpool,
ASAP, and EEI individually, as well as
ASAP, American Council for an EnergyEfficient Economy (ACEEE), American
Rivers (AR), Natural Resources Defense
Council (NRDC), Northeast Energy
Efficiency Partnerships (NEEP),
Northwest Power and Conservation
Council (NPCC), Southern California
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Gas Company (SCG), San Diego Gas and
Electric Company (SDG&E), Southern
California Edison (SCE), and
Earthjustice (EJ) jointly (hereafter ‘‘Joint
Comment’’) supported the
determination that a combined energy
metric for microwave ovens is
technically infeasible. (AHAM, Public
Meeting Transcript, No. 40.5 at pp. 27
and 54–55; Whirlpool, Public Meeting
Transcript, No. 40.5 at p. 29; ASAP,
Public Meeting Transcript, No. 40.5 at p.
53; EEI, Public Meeting Transcript, No.
40.5 at p. 55; Whirlpool, No. 50 at p. 4;
AHAM, No. 47 at p. 4; Joint Comment,
No. 44 at p. 10)
Giving consideration to its previous
findings and this general support from
interested parties, DOE expects to
maintain the approach, consistent with
its preliminary determination, that a
separate standby mode and off mode
energy use metric should be developed
in the continuation of the microwave
oven energy conservation standards
rulemaking, as discussed in section
II.B.3 of this notice.
B. Test Procedures
For the reasons set forth in the
October 2008 NOPR, DOE is not
pursuing modification of its test
procedures for cooking products in
conjunction with this rulemaking, other
than an amendment to address the
standby power consumption of
microwave ovens. 73 FR 62034, 62043–
44 (Oct. 17, 2008). As to the latter, DOE
published an MWO test procedure
NOPR in which it proposed (1) to
incorporate by reference into its
microwave oven test procedure specific
clauses from IEC Standard 62301 as to
methods for measuring average standby
mode and average off mode power
consumption; (2) to incorporate into
that test procedure pertinent definitions
that are set forth in EISA 2007
amendments to EPCA; and (3) to adopt
language to clarify the application of
certain of the clauses that DOE proposes
to incorporate by reference from IEC
Standard 62301. 73 FR 62134 (Oct. 17,
2008). In the MWO test procedure
NOPR, DOE also proposed a technical
correction to an equation in the existing
microwave oven test procedure, which
concerns energy use in the active mode.
Id. at 62137, 62141–42.
Largely because of the issues
surrounding the MWO test procedure,
DOE is continuing the energy
conservation standards rulemaking for
microwave oven standby mode and off
mode power consumption. Therefore,
DOE is also continuing to consider
microwave oven test procedure
amendments that would reflect clarified
and expanded definitions of ‘‘standby
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mode’’ and ‘‘off mode’’ power, which
are expected to be incorporated in the
second edition of IEC Standard 62301.
C. Technological Feasibility
1. General
As stated above, any standards that
DOE establishes for cooking products
must be technologically feasible. (42
U.S.C. 6295(o)(2)(A) and (o)(3)(B)) DOE
considers a design option to be
technologically feasible if it is in use by
the respective industry or if research has
progressed to the development of a
working prototype. ‘‘Technologies
incorporated in commercial products or
in working prototypes will be
considered technologically feasible.’’ 10
CFR part 430, subpart C, appendix A,
section 4(a)(4)(i).
This final rule considers the same
design options as those evaluated in the
October 2008 NOPR. (See the final rule
TSD accompanying this notice, chapters
3 and 4.) All the evaluated technologies
have been used (or are being used) in
commercially available products or
working prototypes. DOE also has
determined that there are products
either on the market or in working
prototypes at all of the efficiency levels
analyzed in this notice. Therefore, DOE
has determined that all of the efficiency
levels evaluated in this notice are
technologically feasible.
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2. Gas Cooking Products—Alternatives
to Line-Powered Electronic Ignition
Systems
For gas cooking products, TSL 1
corresponds to the replacement of
baseline constant burning (standing)
pilots with electronic ignition systems.
Line-powered electronic ignition
systems are incorporated into many gas
cooking products currently on the
market, and, thus, this prescriptive
standard is clearly technologically
feasible. For the consumer subgroup
consisting of households without access
to electricity, however, TSL 1 would
require a battery-powered ignition
system. In the October 2008 NOPR, DOE
stated that DOE research suggests that
battery-powered ignition systems could
be incorporated by manufacturers at a
modest cost if manufacturers’ market
research suggested that a substantial
number of consumers found such a
product attribute to be important. DOE
noted that such systems have been
incorporated successfully in a range of
related appliances, such as
instantaneous water heaters. Further,
DOE stated it believed that there is
nothing in the applicable safety
standards that would prohibit such
ignition systems from being
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implemented on gas cooking products.
Therefore, DOE stated in the October
2008 NOPR that households that use gas
for cooking and are without electricity
would likely have technological options
that would enable them to continue to
use gas cooking if standing pilot ignition
systems were eliminated. 73 FR 62034,
62048, 62075, 62130 (Oct. 17, 2008).
Numerous interested parties objected to
DOE’s tentative conclusion for the
following reasons.
Safety. AHAM, Whirlpool, and GE
commented that DOE did not address
potential safety concerns of eliminating
standing pilots, and expressed concern
that battery-powered ignition systems
would not meet the applicable safety
standard, American National Standards
Institute (ANSI) Standard Z21.1,
‘‘American National Standard for
Household Cooking Gas Appliances’’
(ANSI Z21.1). (AHAM, Public Meeting
Transcript, No. 40.5 at pp. 15–16, 48–
49; AHAM, No. 47 at p. 2; Whirlpool,
No. 50 at p. 4; GE, No. 48 at p. 2) AHAM
believes that ANSI Z21.1 would need to
be revised to incorporate batterypowered ignition systems for
unattended units (i.e., gas ovens), and
this would not likely take place before
the proposed 2012 effective date of
potential standards. (AHAM, No. 47 at
p. 2 and p. 4)
The American Gas Association (AGA)
and AHAM commented that batterypowered ignition systems are not viable
on a residential range because of cost
and safety, particularly regarding the
need for battery replacement. If a battery
is not readily available, these
commenters argued that consumers may
attempt to light the range with a match
or use an extension cord. Furthermore,
these commenters suggested that if
battery-powered ignition systems are
not on the market, the reason may be
economics. AGA recommended that
DOE use caution before determining
viability of such systems. (AGA, Public
Meeting Transcript, No. 40.5 at pp. 44–
45; AHAM, No. 47 at p. 4) Whirlpool
noted that battery-powered ignition
systems are subject to failure when the
battery is weak or dead, and that the
consumer cannot determine battery
status. According to Whirlpool, using
matches as a backup for ignition is
unsafe and would also lead to making
matches more accessible to small
children. (Whirlpool, No. 50 at p. 4)
U.S. Representatives Joseph Pitts and
Bill Shuster (Pitts and Shuster) also
commented that a safety concern exists
if a consumer tries to light a range with
matches when the batteries in the
ignition system are dead. (Pitts and
Shuster, No. 57 at p. 2) Whirlpool,
AHAM, and GE expressed concern
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about the viability of using ignition
systems typically designed for outdoor
grills in an indoor application, primarily
for reasons of potential gas leakage and
reliability. (Whirlpool, No. 50 at p. 4;
AHAM, No. 47 at p. 4; AHAM, Public
Meeting Transcript, No. 40.5 at p. 49;
GE, No. 48 at p. 2) Whirlpool stated that,
in outdoor applications such as grills,
air movement would likely disperse gas
if the unit failed to ignite. However, in
indoor applications, dispersion is
unlikely, thereby resulting in an
elevated threat of explosion or
suffocation. (Whirlpool, No. 50 at p. 4)
Sempra Utilities (Sempra) agreed with
AGA about potential safety issues,
particularly for low-income consumers.
(Sempra, Public Meeting Transcript, No.
40.5 at p. 46) Pacific Gas and Electric
(PG&E) responded to Sempra’s comment
by stating that although DOE cannot
compromise safety in considering
battery-powered ignition systems,
frequently initial cost is weighted too
much relative to operating cost. (PG&E,
Public Meeting Transcript, No. 40.5 at p.
47) DOE understands PG&E’s comment
to mean that, even for low-income
consumers, a higher cost for a safe,
reliable battery-powered ignition system
may be economically justified. GE stated
there are currently no proven safe,
reliable alternative to standing pilots,
and until such time as a proven
alternative exists, standing pilots should
be retained. (GE, No. 48 at pp. 1–2)
Commercial Availability. AGA and
Sempra questioned whether batterypowered ignition systems have been
applied to other residential products,
such as instantaneous water heaters or
furnaces. AGA, Pitts and Shuster, and
the National Propane Gas Association
(NPGA) recognized that there are
recreational vehicle (RV) water heaters
and furnaces which use a 12-volt (V)
battery ignition system, but they believe
this specialty application would be
difficult to apply to a domestic range
due to cost, safety certification, and
other issues. (AGA, Public Meeting
Transcript, No. 40.5 at pp. 18, 44, and
93; Sempra, Public Meeting Transcript,
No. 40.5 at p. 46; NPGA, No. 52 at p.
2; AGA, No. 46 at p. 2; Pitts and
Shuster, No. 57 at p. 2)
EEI asked if there are battery-powered
ignition systems in any commercially
available indoor gas cooking products
on the market. (EEI, Public Meeting
Transcript, No. 40.5 at p. 43) AGA and
NPGA stated that there are currently no
design-certified and listed household
products available that incorporate
battery-powered ignition systems.
According to AGA and NPGA, any
presumption that such systems could be
incorporated into covered products
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raises a host of uncertainties regarding
safety, certification, and other issues,
and, therefore, goes beyond the scope of
this rulemaking. (AGA, No. 46 at p. 2;
NPGA, No. 52 at p. 2) Pitts and Shuster
commented that battery-powered
ignitions systems are not currently on
the market because they are not cost
effective. (Pitts and Shuster, No. 57 at p.
2) AHAM and GE do not see that there
are any other viable technologies to
eliminate standing pilots. (AHAM,
Public Meeting Transcript, No. 40.5 at p.
48; GE, No. 48 at p. 2) LG Electronics
(LG) asked whether DOE considered
technologies and products available in
other parts of the world. (LG, Public
Meeting Transcript, No. 40.5 at p. 47)
Households Without Electricity. GE
and Peerless-Premier Appliance
Company (Peerless-Premier) stated that
standing pilots provide consumer utility
for customers without line power for
economic, religious, or other reasons.
(GE, Public Meeting Transcript, No. 40.5
at p. 31; GE, No. 48 at p. 2; Peerless
Letter, No. 57 10 at pp. 1–2) AGA and
NPGA also questioned DOE’s assertion
that consumer subgroups that are
prohibited from using electricity would
be allowed to use battery-powered
ignition. (AGA, No. 46 at p. 2; NPGA,
No. 52 at p. 2)
DOE Response to Comments. In
response to these comments, DOE
conducted additional research on
battery-powered ignition systems for
residential gas cooking products. As an
initial matter, DOE could not identify
any indoor ranges incorporating such
ignition systems that are on the market
in the United States. DOE was able to
identify a single gas range for sale in the
United Kingdom (U.K.) that
incorporates a battery-powered ignition
system that appeared to meet the
functional safety requirements of ANSI
Z21.1 (i.e., that the oven main burner is
lit by an intermittent gas pilot that is in
turn lit by a battery-powered spark
igniter.) This ignition system does not
require the user to push a separate
‘‘light’’ button at the same time as the
control knob is turned to allow pilot gas
flow. Such a separate operation would
be prohibited under ANSI Z21.1.
However, further DOE research
determined that the ignition system
does not include a safety device to shut
off the main gas valve in the event that
10 In addition to its comments submitted to DOE,
entered into the docket as comment number 42,
Peerless-Premier Appliance Co. submitted a letter
(Peerless Letter) to Congressman Whitfield of
Kentucky regarding the October 2008 NOPR. A
copy of the letter was entered into the docket as
comment number 55 for this rulemaking in addition
to comments that Peerless-Premier submitted
directly to DOE.
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17:28 Apr 07, 2009
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no flame is detected, which is required
by the ANSI standard.
However, as noted from interested
parties’ comments, there are gas cooking
products with battery-powered ignition
for RV applications that are available in
the United States. DOE determined that
the sections in the ANSI safety
standards for RV gas cooking products
and residential gas cooking products
that relate to the ignition system are
equivalent. Thus, it could be inferred
that a battery-powered ignition system
designed for an RV gas range could be
integrated into a residential gas range
that could meet ANSI Z21.1
requirements. Such certification,
though, does not appear to have been
obtained thus far. In addition, these
ignition systems are powered by 12 V
automotive-type batteries and consume
enough energy during operation to
preclude the use of typical householdscale batteries, such a 1.5 V ‘‘AA’’ or 9
V batteries. Since 12 V batteries must be
periodically recharged, this approach
would likely not be viable for
consumers without household
electricity.
DOE next investigated the possibility
that battery-powered ignition systems
used in other indoor residential
appliances in the United States could
meet the requirements of ANSI Z21.1,
even though they are not currently being
incorporated in gas cooking products.
DOE identified several such appliances,
including a remote-controlled gas
fireplace and instantaneous gas water
heaters. For these products, the batterypowered ignition systems are required
to meet the same or equivalent
component-level ANSI safety standards
as are required for automatic ignition
systems in gas cooking products. DOE
contacted several manufacturers of gas
cooking products, fireplaces, and
instantaneous water heaters, as well as
ignition component suppliers, to
investigate the technological feasibility
of integrating these existing batterypowered ignition systems into gas
cooking products that would meet ANSI
Z21.1. None of these manufacturers
could identify insurmountable
technological impediments to the
development of such a product. Based
on its research, DOE determined that the
primary barrier to commercialization of
battery-powered ignition systems in gas
cooking products has been lack of
market demand and economic
justification rather than technological
feasibility. Therefore, DOE concludes
that a gas range incorporating one of
these ignition systems could meet ANSI
Z21.1. In addition, DOE research
suggests that the market niche for gas
cooking products equipped with
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battery-powered ignition systems,
which would be created by the
proposed gas cooking product
standards, would likely attract entrants
among ignition component suppliers.
After considering issues regarding
safety and commercial availability, DOE
concludes that technologically feasible
alternative ignition systems to standing
pilots in gas cooking products for the
small subgroup of households without
electricity will likely be available at the
time these energy conservation
standards are effective. For more
information, see chapter 3 of the TSD
accompanying this notice.
3. Maximum Technologically Feasible
Levels
As required by EPCA under 42 U.S.C.
6295(p)(2), in developing the October
2008 NOPR, DOE identified the design
options that would increase the energy
efficiency of cooking products. 73 FR
62034, 62045 (Oct. 17, 2008). (See
chapter 5 of the NOPR TSD.) DOE did
not receive any comments on the
maximum technologically feasible
levels in the October 2008 proposed rule
that would lead DOE to consider
changes to these levels. Therefore, for
today’s final rule, the max-tech levels
for all cooking product classes are the
max-tech levels identified in the
October 2008 NOPR. These levels are
provided in Table III.1 below.
TABLE III.1—OCTOBER 2008 PROPOSED MAX-TECH LEVELS FOR
COOKING PRODUCTS
Product
Gas Cooktops .........................
Electric Open (Coil) Cooktops
Electric Smooth Cooktops ......
Gas Standard Ovens ..............
Gas Self-Clean Ovens ............
Electric Standard Ovens .........
Electric Self-Clean Ovens ......
Microwave Ovens ...................
Max-Tech EF
0.42
0.769
0.753
0.0583
0.0632
0.1209
0.1123
0.602
D. Energy Savings
DOE forecasted energy savings in its
NES analysis through the use of an NES
spreadsheet tool, as discussed in the
October 2008 NOPR. 73 FR 62034,
62045–46, 62068–74, 62104–05 (Oct. 17,
2008).
One criterion that governs DOE’s
adoption of standards for cooking
products is that the standard must result
in ‘‘significant conservation of energy.’’
(42 U.S.C. 6295(o)(3)(B)) While EPCA
does not define the term ‘‘significant,’’
a U.S. Court of Appeals, in Natural
Resources Defense Council v.
Herrington, 768 F.2d 1355, 1373 (D.C.
Cir. 1985), indicated that Congress
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intended ‘‘significant’’ energy savings in
this context to be savings that were not
‘‘genuinely trivial.’’ DOE’s estimates of
the energy savings for energy
conservation standards at each of the
TSLs considered for cooking products
for today’s rule indicate that the energy
savings each would achieve are
nontrivial. Therefore, DOE considers
these savings ‘‘significant’’ within the
meaning of section 325 of EPCA.
E. Economic Justification
1. Specific Criteria
As noted earlier, EPCA provides
seven factors to evaluate in determining
whether an energy conservation
standard for covered products is
economically justified. (42 U.S.C.
6295(o)(2)(B)(i) The following sections
discuss how DOE has addressed these
factors in evaluating efficiency
standards for cooking products.
a. Economic Impact on Consumers and
Manufacturers
DOE considered the economic impact
of potential standards on consumers and
manufacturers of cooking products. For
consumers, DOE measured the
economic impact as the change in
installed cost and life-cycle operating
costs (i.e., the LCC.) (See sections IV.C
of this notice and chapter 8 of the TSD
accompanying this notice.) DOE
investigated the impacts on
manufacturers through the manufacturer
impact analysis (MIA). (See sections
IV.F and VI.C.2 of this notice and
chapter 13 of the TSD accompanying
this notice.) This factor is discussed in
detail in the October 2008 NOPR. 73 FR
62034, 62046, 62057–68, 62075–81,
62085–104, 62128–30 (Oct. 17, 2008).
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b. Life-Cycle Costs
DOE considered life-cycle costs of
cooking products, as discussed in the
October 2008 NOPR. 73 FR 62034,
62046, 62057–68, 62085–91 (Oct. 17,
2008). DOE calculated the sum of the
purchase price and the operating
expense—discounted over the lifetime
of the product—to estimate the range in
LCC benefits that consumers would
expect to achieve due to standards.
c. Energy Savings
Although significant conservation of
energy is a separate statutory
requirement for imposing an energy
conservation standard, EPCA also
requires DOE to consider the total
projected energy savings that are
expected to result directly from a
proposed standard in determining the
economic justification of that standard.
(42 U.S.C. 6295(o)(2)(B)(i)(III)) As in the
October 2008 NOPR (73 FR 62034,
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62045–46, 62068–74, 62104–05 (Oct. 17,
2008)), DOE used the NES spreadsheet
results for today’s final rule in its
consideration of total projected savings
that are directly attributable to the
standard levels DOE considered.
d. Lessening of Utility or Performance of
Products
In considering standard levels, DOE
sought to avoid new standards for
cooking products that would lessen the
utility or performance of such products.
(42 U.S.C. 6295(o)(2)(B)(i)(IV)) 73 FR
62034, 62046–47, 62107 (Oct. 17, 2008).
e. Impact of Any Lessening of
Competition
DOE considers any lessening of
competition that is likely to result from
standards. Accordingly, as discussed in
the October 2008 NOPR (73 FR 62034,
62047, 62107 (Oct. 17, 2008)), DOE
requested that the Attorney General
transmit to the Secretary a written
determination of the impact, if any, of
any lessening of competition likely to
result from the standards proposed in
the October 2008 NOPR, including those
for cooking products, together with an
analysis of the nature and extent of such
impact. (42 U.S.C. 6295(o)(2)(B)(i)(V)
and (B)(ii))
To assist the Attorney General in
making such a determination, DOE
provided the Department of Justice
(DOJ) with copies of the October 2008
proposed rule and the TSD for review.
The Attorney General’s response is
discussed in section VI.C.5 and is
reprinted at the end of this rule. (DOJ,
No. 53 at pp. 1–2)
f. Need of the Nation To Conserve
Energy
In considering standards for cooking
products, the Secretary must consider
the need of the Nation to conserve
energy. (42 U.S.C. 6295(o)(2)(B)(i)(VI))
The Secretary recognizes that energy
conservation benefits the Nation in
several important ways. The nonmonetary benefits of standards are likely
to be reflected in improvements to the
security and reliability of the Nation’s
energy system. Standards generally are
also likely to result in environmental
benefits. As discussed in the proposed
rule, DOE has considered these factors
in considering whether to adopt
standards for cooking products. 73 FR
62034, 62047, 62081–84, 62107–62113,
62130–31 (Oct. 17, 2008).
2. Rebuttable Presumption
Section 325(o)(2)(B)(iii) of EPCA
states that there is a rebuttable
presumption that an energy
conservation standard is economically
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justified if the additional cost to the
consumer of a product that meets the
standard level is less than three times
the value of the first-year energy (and,
as applicable, water) savings resulting
from the standard, as calculated under
the applicable DOE test procedure. (42
U.S.C. 6295(o)(2)(B)(iii)) DOE’s LCC and
PBP analyses generate values that
calculate the payback period for
consumers of a product meeting
potential energy conservation standards,
which includes, but is not limited to,
the 3-year payback period contemplated
under the rebuttable presumption test
discussed above. (See chapter 8 of the
TSD that accompanies this notice.)
However, DOE routinely conducts a full
economic analysis that considers the
full range of impacts, including those to
the consumer, manufacturer, Nation,
and environment, as required under 42
U.S.C. 6295(o)(2)(B)(i). The results of
this analysis serve as the basis for DOE
to definitively evaluate the economic
justification for a potential standard
level (thereby supporting or rebutting
the results of any preliminary
determination of economic
justification).
IV. Methodology and Discussion of
Comments on Methodology
DOE used several analytical tools that
it developed previously and adapted for
use in this rulemaking. One is a
spreadsheet that calculates LCC and
PBP. Another tool calculates national
energy savings and national NPV. DOE
also used the GRIM, along with other
methods, in its MIA. Finally, DOE
developed an approach using the
National Energy Modeling System
(NEMS) to estimate impacts of energy
efficiency standards for residential
cooking products on electric utilities
and the environment. The TSD
appendices discuss each of these
analytical tools in detail. As a basis for
this final rule, DOE has continued to use
the spreadsheets and approaches
explained in the October 2008 NOPR.
DOE used the same general
methodology as applied in the October
2008 NOPR, but revised some of the
assumptions and inputs for the final
rule in response to interested parties’
comments. The following paragraphs
discuss these revisions.
A. Market and Technology Assessment
When beginning an energy
conservation standards rulemaking,
DOE develops information that provides
an overall picture of the market for the
products concerned, including the
purpose of the products, the industry
structure, and market characteristics.
This activity includes both quantitative
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and qualitative assessments based
primarily on publicly available
information. DOE presented various
subjects in the market and technology
assessment for this rulemaking. (See the
October 2008 NOPR and chapter 3 of the
NOPR TSD.) These include product
definitions, product classes,
manufacturers, quantities and types of
products sold and offered for sale, retail
market trends, and regulatory and
nonregulatory programs.
1. Product Classes
In general, when evaluating and
establishing energy conservation
standards, DOE divides covered
products into classes by the type of
energy used, capacity, or other
performance-related features that affect
consumer utility and efficiency. (42
U.S.C. 6295(q)) Different energy
conservation standards may apply to
different product classes. Id.
For cooking products, DOE based its
product classes on energy source (e.g.,
gas or electric) and cooking method
(e.g., cooktops, ovens, and microwave
ovens). DOE identified five categories of
cooking products: gas cooktops, electric
cooktops, gas ovens, electric ovens, and
microwave ovens. The following
discussion provides clarification
regarding DOE’s selection of product
classes for residential cooking products.
In its regulations implementing EPCA,
DOE defines a ‘‘conventional range’’ as
‘‘a class of kitchen ranges and ovens
which is a household cooking appliance
consisting of a conventional cooking top
and one or more conventional ovens.’’
10 CFR 430.2. The November 2007
ANOPR presented DOE’s reasons for not
treating gas and electric ranges as a
distinct product category and for not
basing its product classes on that
category, primarily based upon DOE’s
determination that, because ranges
consist of both a cooktop and oven, any
potential cooktop and oven standards
would apply to the individual
components of the range. 72 FR 64432,
64443 (Nov. 15, 2007). In the November
2007 ANOPR, DOE defined a single
product class for gas cooktops as gas
cooktops with conventional burners. 72
FR 64432, 64443–44 (Nov. 15, 2007) For
gas ovens, DOE defined two product
classes—gas standard ovens with or
without a catalytic line and gas selfcleaning ovens. 72 FR 64432, 64445
(Nov. 15, 2007) These product class
definitions were maintained in the
October 2008 NOPR. 73 FR 62034,
62048 (Oct. 17, 2008).
DOE tentatively concluded in the
November 2007 ANOPR that standing
pilot ignition systems are not
performance-related features that
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provide unique utility and would,
therefore, not warrant a separate
product class. 72 FR 64432, 64463 (Nov.
15, 2007). In response to interested
parties’ comments on this proposed
determination, DOE noted in the
October 2008 NOPR that the purpose of
ignition systems is to ignite the gas
when burner operation is needed for
cooking, and either standing pilot or
electronic ignition provides this
function. In addition, DOE concluded
from previous analysis that the ability to
operate in the event of an electric power
outage is not a utility feature that affects
performance of gas cooking products. 73
FR 62034, 62048 (Oct. 17, 2008).
DOE notes that the EISA 2007
amendments to EPCA provide an
exception from the residential boiler
energy conservation standards for ‘‘[a]
boiler that is manufactured to operate
without any need for electricity or any
electric connection, electric gauges,
electric pumps, electric wires, or
electric devices. * * *’’ (42 U.S.C.
6295(f)(3)(C)) Such units are typically
equipped with a standing pilot. The
October 2008 NOPR referred indirectly
to this exception by stating that DOE
addressed it in its residential furnace
and boiler rulemaking. 73 FR 62034,
62048 (Oct. 17, 2008). DOE is clarifying
this statement in today’s final rule as
follows. DOE’s full rulemaking analysis
(conducted prior to passage of EISA
2007) did not result in such an
exception in its most recent energy
conservation standards rulemaking for
residential furnaces and boilers. 72 FR
65136 (Nov. 19, 2007). However, DOE
subsequently published a final rule in
the form of a technical amendment
whose sole purpose was to codify the
EISA 2007 amendments to EPCA
pertaining to residential furnace and
boiler standards set by statute, including
the exception above. 73 FR 43611,
43613 (July 28, 2008). Because the July
28, 2008, rule implemented statutory
provisions over which the Department
had no rulemaking discretion, DOE did
not conduct any supporting analysis or
provide any input on this boiler
exclusion. Congress incorporated this
exclusion in the energy conservation
standards for boilers, but Congress
chose not to include a similar provision
for gas cooking products with standing
pilots. Accordingly, DOE used the
applicable EPCA provisions for
determining whether performancerelated features warrant separate energy
conservation standards (42 U.S.C.
6295(q)(1)), and DOE determined in the
October 2008 NOPR that it would be
unable to create a similar exception for
gas cooking products because there is no
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16053
unique utility associated with gas
cooking products equipped with
standing pilot ignition, compared to
those with electronic ignition. 73 FR
62034, 62048 (Oct. 17, 2008). DOE based
this understanding on its tentative
conclusion that there is not expected to
be any appreciable difference in cooking
performance between gas cooking
products with or without a standing
pilot and that battery-powered
electronic ignitions systems could
provide ignition in the absence of line
power (i.e., electricity from the utility
grid). Id.
Through market research for the
October 2008 NOPR, DOE determined
that battery-powered electronic ignition
systems have been implemented in
other products, such as instantaneous
gas water heaters, barbeques, furnaces,
and other appliances, and the use of
such ignition systems appeared
acceptable under ANSI Z21.1.
Therefore, subgroups that prohibit the
use of line electricity, or that do not
have line electricity available, could
still use gas cooking products without
standing pilots, assuming gas cooking
products would be made available with
battery-powered ignition. Thus, DOE
concluded that standing pilot ignition
systems do not provide a distinct utility
and that a separate class for standing
pilot ignition systems would not be
warranted under 42 U.S.C. 6295(q). 73
FR 62034, 62048 (Oct. 17, 2008).
In response to the October 2008
NOPR, AGA commented that DOE
should assign a separate product class to
gas cooking products with standing
pilots. According to AGA, NPGA, and
Pitts and Shuster, DOE acknowledged in
the October 2008 NOPR that some
religious groups do not allow electricity
or adopt it in their area, and that DOE
made an exception in EISA 2007 to
allow standing pilots for gravity-fed gas
boilers for such consumers. These
commenters believe that gas ranges with
standing pilots should remain available
due to their unique utility. (AGA, Public
Meeting Transcript, No. 40.5 at pp. 16–
18; AGA, No. 46 at p. 2; NPGA, No. 52
at p. 2; Pitts and Shuster, No. 57 at p.
1) NPGA also objected to DOE’s
determination in the October 2008
NOPR that gas ranges incorporating
pilot ignition systems do not provide a
unique utility to gas customers, as well
as DOE’s determination that power
outages are not frequent or long enough
for residential electricity customers to
be affected by the inability to cook food.
NPGA and AGA stated that the utility of
having an appliance with a standing
pilot is important, especially for that
segment of the population that cannot
use electricity due to religious or
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cultural practices or current economic
status, or for whom electrical service is
unavailable (such as for hunting cabins).
(NPGA, No. 52 at p. 2; AGA, No. 46 at
p. 2) AGA also stated that the unique
consumer utility of an ignition system is
conveyed by the installed environment
(i.e., whether line electricity is present)
rather than by the ignition technology
itself. According to AGA, EPCA
addresses consumer utility associated
with the covered product, not with a
specific system or technology used in
the product. (AGA, No. 46 at p. 2)
As discussed above, Congress created
the exception to the standards in EPCA
for residential boilers which operate
without the need for electricity (i.e.,
‘‘gravity-fed gas boilers’’). Such an
exception was not based on analysis in
DOE’s most recent energy conservation
standards rulemaking for residential
furnaces and boilers. Congress did not
provide a similar exclusion for gas
cooking products with standing pilots.
Certain consumer subgroups currently
use such gas cooking products due to
religious or cultural practices or a lack
of access to electrical service. However,
DOE continues to believe that the
consumer utility that would need to be
maintained for these subgroups is the
same as for all consumers (i.e., the
ability to ignite the cooking product
under the nominal conditions of
installation, which for these consumer
subgroups includes the absence of
electrical service.) DOE also considered
whether additional utility is conferred
by the ability to provide ignition during
an atypical event such as a loss of line
power for those consumers who have
electrical service, but DOE did not
receive additional information regarding
duration and frequency of power
outages that would lead it to conclude
that the ability to operate during such
an event represents significant utility.
Therefore, DOE maintains that there is
no unique utility provided by standing
pilot ignition systems, and that a
separate product class for gas cooking
products incorporating standing pilots
is not warranted under 42 U.S.C.
6295(q). In making this determination,
however, DOE recognizes that achieving
safe ignition in gas cooking products for
consumer subgroups without electricity
in the home in the absence of standing
pilot ignition requires an alternative
ignition technology that does not rely on
line power. As discussed in section
III.C.2 of today’s notice and chapter 3 of
the TSD accompanying it, DOE
identified battery-powered ignition
systems as a potential alternative to
standing pilots, and believes that such
systems will likely be commercially
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available to these consumer subgroups
by the time the energy conservation
standards are effective.
2. Technology Options
As discussed above in section III.A,
EEI suggested that DOE consider
methods to reduce the input rate of
standing pilot ignition systems in gas
cooking products, thereby lowering the
product’s overall energy consumption,
rather than strictly considering a ban on
the use of standing pilots. EEI stated
that DOE should create a performance
standard for standing pilot lights,
similar to what was proposed in the
October 2008 NOPR for microwave
ovens. EEI claimed a performance
standard restricting the input rate of
standing pilots could save a large
fraction of standby energy usage in gas
cooking products, while still providing
flexibility to manufacturers. (EEI, Public
Meeting Transcript, No. 40.5 at pp. 19–
20 and 50–51; EEI, No. 56 at p. 2)
In the framework document for this
rulemaking, DOE requested comment on
a list of technologies, based on its 1996
analysis in the ‘‘Technical Support
Document for Residential Cooking
Products’’ 11 (1996 TSD), that it would
consider for improving the efficiency of
cooking products. These technologies
did not include the one EEI now
suggests (i.e., one reducing the input
rate of standing pilot ignition systems.)
In response, several interested parties
submitted comments on the framework
document that indicated the list of
technology options was still relevant
because there have been no major
technological breakthroughs in
conventional cooking products since
1996. 72 FR 64432, 64452 (Nov. 15,
2007) No interested parties suggested
any additional technologies for DOE to
consider. DOE presented this list again
in the November 2007 ANOPR, along
with the analyses based on efficiency
levels derived from the same technology
options. 72 FR 64432, 64451–52, 64463–
64 (Nov. 15, 2007). DOE did not receive
any comments in response to the
November 2007 ANOPR which
suggested analyzing additional
technology options for conventional
cooking products. Furthermore, EEI’s
comments in response to the October
2008 NOPR provided no supporting
information to validate the
technological feasibility of reduced pilot
input rate for improving the energy
usage of gas cooking products equipped
with standing pilots. DOE research did
11 Available online at DOE’s Web site: https://
www.eere.energy.gov/buildings/
appliance_standards/residential/
cooking_products_0998_r.html.
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not identify any commercially available
pilots suitable for gas range applications
that operate at input rates substantially
lower than that assumed for the baseline
efficiency levels (117 British thermal
units per hour (Btu/h) for gas cooktops
and 175 Btu/h for gas ovens.) These
baseline pilot input rates are based upon
data DOE received as inputs to its
analyses presented in the 1996 TSD, and
the baseline values are intended to
represent average input rates for the
distribution of pilots incorporated in
baseline ovens and cooktops. DOE does
not have information on the distribution
of pilot input rates that are associated
with the range of ovens and cooktops
currently on the market, but DOE
believes that pilot capacities are closely
related to the specific burner system(s)
in each cooking product. DOE
concluded that specifying a maximum
pilot input rate without consideration of
the diversity of such systems would
likely raise utility issues, wherein the
pilot could potentially fail to perform its
required ignition function in some
cooking products. For these reasons,
DOE is not considering reduced pilot
input rates in this rulemaking.
3. Excluded Product Classes and
Technologies
DOE stated in the November 2007
ANOPR that it lacks efficiency data to
determine whether certain designs (e.g.,
commercial-style cooking products) and
certain technologies (e.g., induction
cooktops) should be excluded from the
rulemaking. 72 FR 64432, 64444–45,
64460 (Nov. 15, 2007). Due to a lack of
public comments or other information
that would counter DOE’s tentative
decision to exclude these products and
technologies, DOE maintained these
proposed exclusions in the October
2008 NOPR. 73 FR 62034, 62048 (Oct.
17, 2008).
AHAM and Whirlpool agree with the
proposal to exclude commercial-style
cooking products and induction
technology. (AHAM, No. 47 at p. 3;
Whirlpool, No. 50 at p. 1) In light of
these comments in support of the
proposal and in the absence of any new
information, DOE has decided not to
include commercial-style cooking
products and induction technology in
today’s final rule.
B. Engineering Analysis
1. Efficiency Levels
In the November 2007 ANOPR, DOE
reviewed and updated the design
options and efficiency levels published
in the 1996 TSD analysis, an approach
generally supported by interested
parties. DOE did not receive any
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comments on the November 2007
ANOPR regarding omitted cooking
technologies and retained all the
cooking technologies, design options,
and efficiency levels for cooking
product energy factor as part of the
October 2008 NOPR. 73 FR 62034,
62052 (Oct. 17, 2008).
AGA commented in response to the
October 2008 NOPR that DOE did not
consider alternative technologies to
banning standing pilots, which places a
great burden on the justification of pilot
ignition products as the baseline
technology. AGA stated that DOE had
difficulty in defining reasonable design
options for these gas products, but that
does not justify defining standing pilots
as the baseline product. (AGA, No. 46 at
p. 3)
In response, DOE notes that baseline
products refer to a model or models that
have features and technologies typically
found in products currently offered for
sale. The baseline model in each
product class represents the
characteristics of products in that class,
and typically achieves minimum energy
efficiency performance. In the case of
gas cooking products that are not
equipped with an electrical cord (i.e.,
gas cooktops and gas standard ovens),
minimum energy efficiency
performance is associated with products
equipped with standing pilot ignition
systems. DOE research has not revealed
any other design options that would
support the definition of different
baseline efficiency levels for gas
cooktops and gas standard ovens, and
DOE did not receive any information on
alternative technologies or design
options. Therefore, DOE is maintaining
the baseline efficiency levels associated
with standing pilots for gas cooktops
and gas standard ovens in today’s final
rule.
2. Manufacturing Costs
In the November 2007 ANOPR, DOE
estimated a manufacturing cost at each
efficiency level in this rulemaking by
scaling the manufacturing costs that
were provided in the 1996 TSD by the
producer price index (PPI).12 72 FR
64432, 64467–69 (Nov. 15, 2007). DOE
retained these same manufacturing costs
in the October 2008 NOPR and is also
retaining them in today’s final rule
because it has determined that there has
been no significant change in the PPI
since the analysis for the November
2007 ANOPR, which used the PPI from
2006. For electric cooking products
(including microwave ovens), the PPI
increased 1.4 percent between 2006 and
12 Please see the following Web site for further
information: https://www.bls.gov/pPI.
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2007, the most recent year for which
final PPI values are available from the
U.S. Department of Labor’s Bureau of
Labor and Statistics. The PPI for gas
cooking products increased 2.9 percent
in that same time period.
As discussed in the October 2008
NOPR, AGA had commented that DOE
underestimated the incremental
manufacturing cost of electronic
ignition, which for gas cooking products
corresponds to efficiency level 1.
According to AGA, the Harper-Wyman
Co., in 1998 comments to DOE,
provided an incremental retail price of
$150 for a gas range with electronic
ignition relative to a gas range with
standing pilot ignition system. AGA
argued that this retail price increment
stands in sharp contrast to the $37
incremental manufacturing cost
estimated by DOE. 73 FR 62034, 62054
(Oct. 17, 2008).
In response to AGA’s comments on
the November 2007 ANOPR, DOE
contacted component suppliers of gas
cooking product ignition systems to
validate DOE’s manufacturing cost
estimates. DOE believes that the
information collected verified that the
costs in the November 2007 ANOPR
represented current costs and, therefore,
continued in the October 2008 NOPR to
characterize the incremental
manufacturing costs for the nonstanding pilot ignition systems with the
estimates developed for the November
2007 ANOPR. Id.
In response to the October 2008
NOPR, AGA stated it disagrees with
DOE’s approach for estimating
incremental manufacturing costs for
electronic ignition. AGA commented
that DOE’s use of survey data on
appliance prices is a poor proxy for
manufacturing cost because pricing
policy is based on a host of factors
(including marginal product demand),
not strictly on manufactured cost.
Therefore, the commenter stated that it
disagrees with DOE’s estimate of $37 in
incremental cost for electronic ignition.
Instead, AGA believes that DOE should
use a figure closer to the estimate of
$150 previously provided by AGA,
which was based on manufacturer
estimates for redesign of pilot ignition
products. AGA also stated that DOE
should examine the impact on
consumers, not on the manufacturer’s
costs. (AGA, Public Meeting Transcript,
No. 40.5 at pp. 17–18; AGA, No. 46 at
p. 4)
For this final rule, DOE conducted
further research regarding retail prices
for comparable gas ranges with standing
pilot and electronic ignition systems. A
comparison of manufacturer suggested
retail prices for four brands showed a
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16055
price differential ranging from $0 to $50
for a consumer to purchase a gas range
with an electronic ignition system,
rather than a standing pilot, from the
same manufacturer. (See chapter 3 of
the TSD accompanying this notice.)
DOE recognizes that manufacturer
pricing takes many factors into account,
but the consistency of the price
increments among four different
manufacturers suggests that DOE’s
estimate of $37 for a manufacturing cost
increment to eliminate standing pilots
in a gas range has greater validity than
an increment of $150. DOE further notes
that, according to AGA’s comments on
the November 2007 ANOPR, the $150
estimate was provided by HarperWyman Co. in 1998. DOE believes that
its own discussions with ignition
component suppliers during the ANOPR
phase of this rulemaking may represent
more current technologies and costs.
Therefore, DOE has decided to retain
the proposed incremental
manufacturing costs in today’s final
rule.
C. Life-Cycle Cost and Payback Period
Analyses
The purpose of the LCC and PBP
analyses is to evaluate the economic
impacts of possible new energy
conservation standards for cooking
products on individual consumers. The
LCC is the total consumer expense over
the life of the product, including
purchase and installation expense and
operating costs (energy expenditures,
repair costs, and maintenance costs).
The PBP is the number of years it would
take for the consumer to recover the
increased costs of purchasing a higher
efficiency product through energy
savings. To calculate LCC, DOE
discounted future operating costs to the
time of purchase and summed them
over the lifetime of the product. DOE
measured the change in LCC and the
change in PBP associated with a given
efficiency level relative to a base-case
forecast of product efficiency. The basecase forecast reflects the market in the
absence of amended mandatory energy
conservation standards.
As part of the LCC and PBP analyses,
DOE developed data that it used to
establish product prices, installation
costs, annual household energy
consumption, energy prices,
maintenance and repair costs, product
lifetime, and discount rates.
DOE calculated the LCC and payback
periods for cooking products for a
nationally representative set of housing
units, which was selected from the
Energy Information Administration
(EIA) Residential Energy Consumption
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Federal Register / Vol. 74, No. 66 / Wednesday, April 8, 2009 / Rules and Regulations
Survey (RECS).13 Similar to the October
2008 NOPR, the analysis for today’s
final rule used the 2001 RECS. (EIA had
not yet released the 2005 RECS when
the analysis was performed. Although
DOE was unable to use the most recent
RECS, the 2001 version still offers a
relatively recent national representation
of how consumers utilize cooking
products. Also, no other public survey
provides a representative national
household sample indicating how
frequently consumers use their cooking
appliances.) By using a representative
sample of households, the analysis
captured the variability in energy
consumption and energy prices
associated with cooking product use.
For each sample household, DOE
determined the energy consumption for
the cooking product and the energy
price. DOE calculated the LCC
associated with a baseline cooking
product for each household. To
calculate the LCC savings and PBP
associated with products meeting higher
efficiency standards, DOE substituted
the baseline unit with a more efficient
design.
Table IV.1 summarizes the
approaches and data DOE used to derive
the inputs to the LCC and PBP
calculations for the October 2008 NOPR,
and the changes it made for today’s final
rule. For this final rule, DOE did not
introduce changes to the LCC and PBP
analyses methodology described in the
October 2008 NOPR. However, DOE
revised its energy prices and energy
price forecasts based upon the most
recently available data from EIA.
Chapter 8 of the TSD accompanying this
notice contains detailed discussion of
the methodology utilized for the LCC
and PBP analyses, as well as the inputs
developed for the analyses.
TABLE IV.1—SUMMARY OF INPUTS AND KEY ASSUMPTIONS IN THE LCC AND PBP ANALYSES
Inputs
October 2008 NOPR
Changes for the final rule
Affecting Installed Costs
Product Price .......................
Installation Cost ...................
Derived by multiplying manufacturer cost by manufacturer, retailer markups and sales tax.
Baseline cost based on RS Means Mechanical Cost
Data, 2008.14 Based the percentage of households
with gas cooking products that would need to install
an electrical outlet on requirements in the National
Electrical Code (NEC). Determined that only households built before 1960 would require the installation
of an outlet. Overall, estimated that 10 percent of
households with gas standard ovens and 4 percent
of households with gas cooktops would need to install an electrical outlet to accommodate designs that
require electricity. Based electrical outlet installation
costs on requirements in the NEC.
No change.
No change.
Affecting Operating Costs
Annual Energy Use ..............
Energy Prices .......................
Energy Price Trends ............
Repair and Maintenance
Costs.
Based on recent estimates from the 2004 ‘‘California
Residential Appliance Saturation Survey’’ 15 (RASS)
and the Florida Solar Energy Center 16 (FSEC). Used
2001 RECS data to establish the variability of annual
cooking energy consumption. Included standby
power consumption for microwave ovens.
Electricity: Based on EIA’s 2006 Form 861 data.17 ........
Natural Gas: Based on EIA’s 2006 Natural Gas Monthly 18.
Variability: Regional energy prices determined for 13
regions.
Forecasted with EIA’s Annual Energy Outlook (AEO)
2008.
For gas cooktops and standard ovens, accounted for
increased costs associated with glo-bar or electronic
spark ignition systems relative to standing pilot ignition systems. For all standard levels for all other
product classes, estimated no change in costs between products more efficient than baseline products.
No change.
Electricity: Updated using EIA’s 2007 Form 861 data.
Natural Gas: Updated using EIA’s 2007 Natural Gas
Monthly.
Variability: No change.
Reference Case forecasts updated with EIA’s AEO2009
Early Release.19 AEO2009 Early Release does not
provide High-Growth and Low-Growth forecasts,
Scaled AEO2008 High-Growth and Low-Growth forecasts by the ratio of AEO2009 and AEO2008 Reference Case forecasts to estimate high-growth and
low-growth price trends.
No change.
mstockstill on PROD1PC66 with RULES2
Affecting Present Value of Annual Operating Cost Savings
Product Lifetime ...................
Based on data from Appliance Magazine,20 past DOE
TSDs, and the California Measurement Advisory
Committee (CALMAC).21 Variability and uncertainty
characterized with Weibull probability distributions.
13 U.S. Department of Energy—Energy
Information Administration, Residential Energy
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No change.
Consumption Survey, 2001 Public Use Data Files
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(2001). Available at: https://www.eia.doe.gov/emeu/
recs/recs2001/publicuse2001.html.
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16057
TABLE IV.1—SUMMARY OF INPUTS AND KEY ASSUMPTIONS IN THE LCC AND PBP ANALYSES—Continued
Inputs
October 2008 NOPR
Changes for the final rule
Discount Rates .....................
Approach based on the finance cost of raising funds to
purchase appliances either through the financial cost
of any debt incurred to purchase products, or the opportunity cost of any equity used to purchase products. Primary data source is the Federal Reserve
Board’s Survey of Consumer Finances (SCF) for
1989, 1992, 1995, 1998, 2001, and 2004 22.
No change.
Affecting Installed and Operating Costs
Effective Date of New or
Amended Standards.
Base-Case Efficiency Distributions.
2012 ................................................................................
No change.
Gas cooktops: 7% at baseline; 93% with electronic
spark ignition.
Gas standard ovens: 18% at baseline; 74% with glo-bar
ignition; 8% with electronic spark ignition.
Microwave ovens: 100% at baseline EF ........................
All other cooking products: 100% at baseline ................
No change.
1. Product Prices
To calculate the product prices faced
by consumers, DOE multiplied the
manufacturing costs developed from the
engineering analysis by the supply
chain markups it developed (along with
sales taxes). To calculate the final
installed prices, DOE added installation
costs to the consumer product prices. In
response to the October 2008 NOPR,
interested parties provided no
additional comment on DOE’s methods
for establishing consumer product
prices. As a result, DOE used the same
supply chain markups for the final rule
that were developed for the October
2008 NOPR. See chapter 7 of the TSD
accompanying this notice for additional
information.
2. Installation Cost
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Installation costs include labor,
overhead, and any miscellaneous
materials and parts. For the October
2008 NOPR and today’s final rule, DOE
used data from the ‘‘RS Means
Mechanical Cost Data, (2008),’’ on labor
14 RS Means, Mechanical Cost Data (30th Annual
Edition) (2008). Available for purchase at https://
www.rsmeans.com/bookstore/.
15 Please see the following Web site for further
information: https://www.energy.ca.gov/appliances/
rass/.
16 Please see the following Web site for further
information: https://www.fsec.ucf.edu/en/.
17 Please see the following Web site for further
information: https://www.eia.doe.gov.
18 Please see the following Web site for further
information: https://www.eia.doe.gov.
19 Please see the following Web site for further
information: https://www.eia.doe.gov/oiaf/aeo/
index.html?featureclicked=1&.
20 Please see the following Web site for further
information: https://www.appliancemagazine.com.
21 Please see the following Web site for further
information: https://www.calmac.org.
22 Please see the following Web site for further
information: https://www.federalreserve.gov.
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No change.
No change.
No change.
requirements to estimate installation
costs for cooking products.
For the October 2008 NOPR, DOE did
not include an installation cost for
microwave ovens. Electrolux stated that
over-the-range (OTR) microwave ovens
do have an installation cost. (Electrolux,
Public Meeting Transcript, No. 40.5 at p.
123) DOE acknowledges that OTR
microwave ovens incur installation
costs. However, as noted below, because
DOE estimated that the installation cost
does not change with product
efficiency, the omission of this cost for
microwave ovens has no effect on the
LCC saving and PBP results.
For many cooking products, DOE
estimated that installation costs would
be the same for different efficiency
levels. For gas cooktops and gas
standard ovens, DOE evaluated the
impact that eliminating standing pilot
ignition systems would have on the
installation cost. Peerless-Premier stated
that eliminating pilots would affect
customers who live in older houses,
apartments, and manufactured homes
without a power receptacle located at
the range site. (Peerless-Premier, No. 42
at pp. 1–2) For the October 2008 NOPR
and today’s final rule, DOE considered
the percentage of households with gas
ranges, cooktops, and ovens that would
require the installation of an electrical
outlet in the kitchen to accommodate a
gas cooking product without standing
pilot ignition, as well as the cost of
installing an electrical outlet.
For the October 2008 NOPR, DOE
reviewed the gas oven and gas cooktop
household samples to establish which
houses may require installation of an
outlet. DOE was able to determine the
composition of the household sample of
particular vintage (year built) groupings
by conducting an assessment of
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National Electrical Code (NEC)
requirements over time to help
determine which homes may need an
electrical outlet to accommodate a gas
cooking product that requires
electricity. Because the NEC requires
spacing electrical outlets every 6 feet for
homes built since 1960, DOE concluded
that homes built after 1959 would not
need an additional outlet. Pre-1960
homes represent 57 percent of the
standard gas oven sample and 54
percent of the gas cooktop sample.
Based on shipments data of gas cooking
products indicating that fewer than 7
percent and 18 percent of gas cooktops
and standard ovens, respectively, came
equipped with standing pilots, DOE also
concluded that many pre-1960 homes
already have a gas cooking product
without standing pilot ignition, which
implies that they would not need to
install an additional outlet.
The Joint Comment asserted that DOE
erroneously assumed that 100 percent of
pre-1960 homes with gas cooktops and
ovens do not have adequate electrical
outlets, without regard to the extensive
number of kitchens that have been
remodeled since 1960. (Joint Comment,
No. 44 at p. 11) EEI made a similar
point. (EEI, Public Meeting Transcript,
No. 40.5 at pp. 111–112) In response,
DOE did not assume that all pre-1960
homes with gas cooktops and gas ovens
would require an electrical outlet.
Rather, it concluded that only those
households that currently have a gas
cooking product with standing pilot
ignition would need to install an
electrical outlet to accommodate a gas
cooking product without standing pilot
ignition. Based on the percentage of
recent shipments of gas cooking
products with standing pilots and the
fraction of the household sample built
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before 1960, DOE estimated that 10
percent of the overall gas standard oven
household sample would need to install
an electrical outlet to accommodate a
gas standard oven that requires
electricity to operate. It is worth noting
that some portion of gas cooking
products with standing pilot ignition is
evidently purchased by consumers in
post-1959 homes, even though they
have an electrical outlet adequate to
accommodate a gas cooking product
without standing pilot ignition.
AGA and AHAM stated that DOE’s
approach should not consider all gas
cooking product consumers, but only
the market for gas cooking products that
utilize standing pilot ignition systems.
They believe the resulting weightedaverage installation cost for all gas
cooking products would be greater than
DOE’s estimate. (AGA, No. 46 at pp. 3–
4; AHAM, No. 47 at p. 2) As described
above, DOE did estimate the share of the
gas oven and gas cooktop household
samples that still use standing pilot
ignition systems, and further estimated
the fraction of those homes that may
require installation of an outlet to
accommodate a gas cooking product that
requires electricity to operate. DOE
correctly calculated the respective
weighted-average installation costs for
all homes with either gas cooktops or
ovens, although the weighted averages
are reported for informational purposes
only and do not directly figure into the
LCC calculations. For further details on
the development of the electrical outlet
installation cost and the percentage of
households requiring an outlet, see
chapter 8 of the TSD accompanying this
notice.
3. Annual Energy Consumption
In the October 2008 NOPR, DOE
based its estimates of annual energy use
for cooking products (except microwave
ovens) on results from the 2004
California Residential Appliance
Saturation Survey (RASS) and the
Florida Solar Energy Center (FSEC.). For
today’s final rule, DOE continued to rely
on these sources, because they are the
latest available public sources
describing the field consumption of
cooking products. In addition, DOE
continued to use the 2001 RECS data to
establish the variability of annual
energy consumption for cooktops and
ovens. The 2001 RECS is the most
recently available public data source
that indicates the variability of cooking
product usage in U.S. households.
For microwave ovens, DOE used the
2004 RASS to estimate the product’s
annual energy consumption, and it used
the 2001 RECS data to establish the
variability of annual cooking energy
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2030, DOE followed past guidelines
provided to the Federal Energy
Management Program by EIA and used
the average rate of change during 2020–
2030 to estimate the price trends after
2030.
The spreadsheet tools used to conduct
the LCC and PBP analyses allow users
to select either the AEO’s high-growth
case or low-growth case price forecasts
to estimate the sensitivity of the LCC
and PBP to different energy price
forecasts. The AEO2009 Early Release
4. Energy Prices
provides only forecasts for the reference
DOE derived average electricity and
case. Therefore, for the final rule, DOE
natural gas prices for 13 geographic
scaled the AEO2008 high-growth case or
areas consisting of the nine U.S. Census low-growth forecasts by the ratio of
divisions, with four large States (New
AEO2009 and AEO2008 reference case
York, Florida, Texas, and California)
forecasts to estimate high-growth and
treated separately. For Census divisions
low-growth price trends.
containing one of these large States,
The Joint Comment recommended
DOE calculated the regional average
values minus the data for the large State. that DOE conduct a sensitivity analysis
using other forecasts in addition to the
DOE estimated residential electricity
AEO, as they believe that the AEO has
prices for each of the 13 geographic
areas based on data from EIA Form 861, estimated lower electricity prices than
most other forecasts. (Joint Comment,
Annual Electric Power Industry Report.
No. 44 at p. 11) As mentioned above,
DOE calculated an average residential
DOE included the AEO’s high-growth
electricity price by first estimating an
average residential price for each utility case and low-growth case price forecasts
in its spreadsheet tools to estimate the
by dividing the residential revenues by
residential kilowatt-hour sales and then sensitivity of the LCC and PBP results
to different energy price forecasts.
calculating a regional average price by
weighting each utility with customers in AEO’s high-economic-growth and loweconomic-growth cases show the effects
a region by the number of residential
of alternative economic growth
consumers served in that region. The
assumptions on the energy market
calculations for today’s final rule used
projections. In the high-growth case,
the most recent available data from
real gross domestic product (GDP)
2007.
DOE estimated residential natural gas growth averages 3.0 percent per year, as
prices in each of the 13 geographic areas a result of higher assumed growth rates
for the labor force, non-farm
based on data from the EIA publication
employment, and non-farm labor
Natural Gas Monthly. For the October
2008 NOPR, DOE used the data for 2006 productivity. With higher productivity
gains and employment growth, inflation
to calculate an average summer and
and interest rates are lower than in the
winter price for each area. For today’s
final rule, DOE used 2007 data from the reference case. In the low-growth case,
same source. DOE calculated an average growth in real GDP is 1.8 percent per
year, as a result of lower assumed
natural gas price by first calculating the
growth rates for the labor force, nonaverage prices for each State, and then
calculating a regional price by weighting farm employment, and labor
each State in a region by its population. productivity. Consequently, the lowgrowth case shows higher inflation and
This method differs from the method
interest rates and slower growth in
used to calculate electricity prices,
industrial output and employment than
because EIA does not provide
are projected in the reference case. DOE
consumer-level or utility-level data on
believes the AEO alternative forecasts
gas consumption and prices.
provide a suitable range that brackets
To estimate the trends in electricity
the forecasts resulting from other
and natural gas prices for the October
energy-economy models. In addition,
2008 NOPR, DOE used the price
the Joint Comment provides no specific
forecasts in EIA’s Annual Energy
information on any other forecasts or on
Outlook (AEO) 2008. To arrive at prices
why AEO’s high-growth and low-growth
in future years, DOE multiplied the
cases do not provide a reasonable range
average prices described above by the
forecast of annual average price changes of forecasts. As a result, DOE has
in AEO2008. For today’s final rule, DOE concluded that AEO’s high-growth and
low-growth cases provide an adequate
updated its energy price forecasts to
basis to examine the sensitivity of LCC
those in the AEO2009 Early Release.
Because the AEO forecasts prices only to and PBP results to other price forecasts.
consumption. For today’s final rule,
DOE continued to use the above
approaches. As noted above, the 2004
RASS is the latest available public data
source describing the average field
consumption of microwave ovens, and
the 2001 RECS is the most recently
available public data source that
indicates the variability of microwave
oven usage in U.S. households. See
chapter 6 of the TSD accompanying this
notice for further details.
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The Joint Comment stated that to
realistically depict energy prices in the
future, DOE must consider the impact of
carbon control legislation, since such
legislation is very likely. The Joint
Comment also noted that there are
regional cap-and-trade programs in
effect in the Northeast (Regional
Greenhouse Gas Initiative (RGGI)) and
the West (Western Climate Initiative
(WCI)) that will affect the price of
electricity but are not reflected in the
AEO energy price forecasts. (Joint
Comment, No. 44 at p. 12) Earthjustice
stated that Federal caps will likely be in
place by the time new standards become
effective, so DOE should increase its
electricity prices to reflect the cost of
complying with emission caps.
(Earthjustice, Public Meeting Transcript,
No. 40.5 at pp. 195–196) In response,
DOE notes that the shape of Federal
carbon control legislation, and the
ensuing cost of carbon mitigation to
electricity generators, is as yet too
uncertain to incorporate into the energy
price forecasts that DOE uses. The costs
of carbon mitigation to electricity
generators resulting from the regional
programs are also very uncertain over
the forecast period for this rulemaking.
Even so, EIA did include the effect of
the RGGI in its AEO2009 Early Release
energy price forecasts, but WCI did not
provide sufficient detail for EIA to
model the impact of the WCI on energy
price forecasts. Therefore, the energy
price forecasts used in today’s final rule
do include the impact of one of the two
regional cap-and-trade programs to the
extent possible.
5. Repair and Maintenance Costs
Repair costs are associated with
repairing or replacing components that
have failed in the appliance, whereas
maintenance costs are associated with
maintaining the operation of the
product.
For the October 2008 NOPR, DOE
contacted six contractors in different
States to estimate whether repair and
maintenance costs differ between
standing pilot and non-standing pilot
ignition systems. Based on the
contractors’ input, DOE determined that
standing pilots are less costly to repair
and maintain than either electric globar/hot surface ignition systems (used in
most gas ovens) or electronic spark
ignition systems (used in gas cooktops
and a small percentage of gas ovens);
that standing pilot ignition systems
require repair and maintenance every 10
years to clean valves; and that electric
glo-bar/hot surface ignition systems
require glo-bar replacement
approximately every 5 years. 73 FR
62034, 62064 (Oct. 17, 2008). Electrolux
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stated that its testing indicates that globar ignition systems tend to hold their
life, but it did not provide data to
support this point. (Electrolux, Public
Meeting Transcript, No. 40.5 at p. 112)
In the absence of new data from
Electrolux, DOE decided to continue to
use the information provided by the
contractors from which it collected data.
In the case of electronic ignition
systems, control modules tend to last
about 10 years. The electrodes/igniters
can fail because of hard contact from
pots or pans, although failures are rare.
Based on the above findings, DOE
estimated an average cost comprised of
a mix of maintenance and repair costs.
For standing pilot ignition systems, DOE
estimated a cost of $126 occurring in the
tenth year of the product’s life. For
electric glo-bar/hot surface ignition
systems, DOE estimated an average cost
of $147 occurring every fifth year during
the product’s lifetime. For electronic
spark ignition systems, DOE estimated
an average cost of $178 occurring in the
tenth year of the product’s life. AGA
generally agreed with DOE’s approach
for consideration of maintenance of
standing pilots and electronic ignition
systems. However, AGA suggested that
DOE use the incremental manufacturing
cost for electronic ignition systems as a
basis for developing the maintenance
costs for these systems. Using this
approach, AGA reasoned that the
resultant maintenance costs would be
higher than DOE estimated. (AGA, No.
46 at p. 4) DOE’s approach resulted in
a combined maintenance and repair cost
that is well above the incremental
manufacturing cost for electronic
ignition systems. Therefore, DOE
retained its approach for estimating
electronic ignition maintenance costs
for today’s final rule as it captures more
costs than solely the manufacturing
costs of the electronic ignition
components. See chapter 8 of the TSD
accompanying this notice for further
information regarding these estimates.
6. Product Lifetime
For the October 2008 NOPR and
today’s final rule, DOE used a variety of
sources to establish low, average, and
high estimates for product lifetime. DOE
established average product lifetimes of
19 years for conventional electric and
gas cooking products and 9 years for
microwave ovens. DOE characterized
residential cooking product lifetimes
with Weibull probability distributions.
See chapter 8 of the TSD accompanying
this notice for further details on the
sources used to develop product
lifetimes, as well as the use of Weibull
distributions.
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16059
7. Discount Rates
To establish discount rates for
cooking products for the October 2008
NOPR and today’s final rule, DOE
derived estimates of the finance cost of
purchasing these appliances. Because
the purchase of products for new homes
entails different finance costs for
consumers than the purchase of
replacement products, DOE used
different discount rates for new
construction and replacement
installations.
DOE estimated discount rates for newhousing purchases using the effective
real (after inflation) mortgage rate for
homebuyers. This rate corresponds to
the interest rate after deduction of
mortgage interest for income tax
purposes and after adjusting for
inflation. DOE used the Federal Reserve
Board’s Survey of Consumer Finances
(SCF) for 1989, 1992, 1995, 1998, and
2001 mortgage interest rates. After
adjusting for inflation and interest tax
deduction, effective real interest rates
on mortgages across the six surveys
averaged 3.2 percent.
For replacement purchases, DOE’s
approach for deriving discount rates
involved identifying all possible debt or
asset classes that might be used to
purchase replacement products,
including household assets that might
be affected indirectly. DOE estimated
the average shares of the various debt
and equity classes in the average U.S.
household equity and debt portfolios
using data from the SCFs from 1989 to
2004. DOE used the mean share of each
class across the six sample years (1989,
1992, 1995, 1998, 2001, 2004) as a basis
for estimating the effective financing
rate for replacement products. DOE
estimated interest or return rates
associated with each type of equity and
debt using SCF data and other sources.
The mean real effective rate across the
classes of household debt and equity,
weighted by the shares of each class, is
5.6 percent.
See chapter 8 of the TSD
accompanying this notice for further
details on the development of discount
rates for cooking products.
8. Effective Date of the Amended
Standards
The effective date is the future date
when parties subject to the requirements
of a new standard must begin
compliance. DOE assumes that any new
energy conservation standards adopted
in this rulemaking would become
effective 3 years after the final rule is
published in the Federal Register.
Therefore, for the purpose of the
analysis, the amended standard is
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assumed to be effective March 2012.
DOE calculated the LCC for the
appliance consumers as if they would
purchase a new product in the year the
standard takes effect.
9. Product Energy Efficiency in the Base
Case
For the LCC and PBP analyses, DOE
analyzes candidate standard levels
relative to a baseline efficiency level.
However, some consumers may already
purchase products with efficiencies
greater than the baseline product levels.
Thus, to accurately estimate the
percentage of consumers that would be
affected by a particular standard level,
DOE considered the distribution of
product efficiencies that consumers are
expected to purchase under the base
case (i.e., the case without new energy
conservation standards). DOE refers to
this distribution of product of
efficiencies as a base-case efficiency
distribution.
Using the base-case efficiency
distributions, DOE assigned a specific
product efficiency to each sample
household. If a household were assigned
a product efficiency greater than or
equal to the efficiency of a specific
standard level under consideration, the
LCC calculation would show that this
household would not be affected by that
standard level.
Unfortunately, little is known about
the distribution of cooking product
efficiencies that consumers currently
purchase. Whirlpool stated that it is not
aware of data on the number of
consumers purchasing electric cooking
products that are more efficient than the
baseline products in the analysis.
(Whirlpool, No. 50 at p. 4) In the
absence of any additional data for
electric cooking products and gas selfcleaning ovens, DOE continued to
estimate that 100 percent of the market
will be at the baseline efficiency levels
in 2012.
For gas cooktops and gas standard
ovens, available data allowed DOE to
estimate the percentage of units sold
that have standing pilot lights. DOE
developed the market share of gas
standard ovens with standing pilots
based on actual shipments data, the
most recent being data from the
Appliance Recycling Information Center
(ARIC) for 1997, 2000, and 2004.23
Based on the ARIC data, the entire
market share of products without
standing pilots should be allocated to
standard level 1 (products with glo-bar
ignition). But based on information
collected from contractors, DOE
estimated that 10 percent of products
without standing pilots use spark
ignition systems. As a result, DOE
allocated 90 percent of the market share
of products without standing pilots to
standard level 1 (with glo-bar ignition)
and the remaining 10 percent to
standard level 1a (with spark ignition).
Table IV.2 shows the market shares of
the efficiency levels in the base case for
gas cooktops and gas standard ovens.
Standard level 1 represents products
without standing pilot light ignition
systems.
TABLE IV.2—GAS COOKTOPS AND GAS STANDARD OVENS: BASE CASE MARKET SHARES
Gas cooktops
Standard level
Gas standard ovens
Market share
%
EF
Baseline ..........................................
1 ......................................................
2 ......................................................
0.156
0.399
0.420
6.8
93.2
0
Standard level
EF
Baseline .........................................
1* ....................................................
2 .....................................................
3 .....................................................
4 .....................................................
5 .....................................................
6 .....................................................
1a* ..................................................
0.0298
0.0536
0.0566
0.0572
0.0593
0.0596
0.0600
0.0583
Market share
%
17.6
74.2
0
0
0
0
0
8.2
* For gas standard ovens, candidate standard levels 1 and 1a correspond to designs that are used for the same purpose—to eliminate the
need for a standing pilot—but the technologies for each design are different. Candidate standard level 1 is a hot surface ignition device, whereas
candidate standard level 1a is a spark ignition device.
For microwave ovens, very little is
known about the distribution of product
efficiencies that consumers currently
purchase. For the October 2008 NOPR
and the final rule, DOE estimated that
100 percent of the microwave oven
market is at the baseline efficiency level
(EF = 0.557).
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10. Inputs to Payback Period Analysis
The payback period is the amount of
time (expressed in years) it takes the
consumer to recover the additional
installed cost of more efficient products
through operating cost savings
compared to baseline products. The
simple payback period does not account
for changes in operating expense over
time or the time value of money.
Payback periods greater than the life of
23 Appliance Recycling Information Center,
INFOBulletin #8, ‘‘Applications in Appliances’’
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the product mean that the increased
total installed costs are not recovered in
reduced operating expenses.
The inputs to the PBP calculation are
the total installed cost of the product to
the customer for each efficiency level
and the annual (first-year) operating
expenditures for each efficiency level.
The PBP calculation uses the same
inputs as the LCC analysis, except that
energy price trends and discount rates
are not needed.
11. Rebuttable Presumption Payback
Period
As noted above, EPCA, as amended
(42 U.S.C. 6295(o)(2)(B)(iii) and
6316(a)), establishes a rebuttable
presumption that a standard is
economically justified if the Secretary
(March 2005). Please see the following Web site for
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finds that ‘‘the additional cost to the
consumer of purchasing a product
complying with an energy conservation
standard level will be less than three
times the value of the energy (and as
applicable, water) savings during the
first year that the consumer will receive
as a result of the standard,’’ as
calculated under the test procedure in
place for that standard. For each TSL,
DOE determined the value of the first
year’s energy savings by calculating the
quantity of those savings in accordance
with DOE’s test procedure, and
multiplying that amount by the average
energy price forecast for the year in
which a new standard would be
expected to take effect—in this case,
2012.
further information: https://www.aham.org/industry/
ht/action/GetDocumentAction/id/5370.
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DOE also received comments
addressing the topic of using a
rebuttable presumption payback period
to establish the economic justification of
an energy conservation standard level.
The Joint Comment and Earthjustice
stated that DOE’s view that
consideration of a full range of impacts
is necessary because the rebuttable
presumption payback period criterion is
not sufficient for determining economic
justification does not reflect the extent
to which the rebuttable presumption
analysis constrains DOE’s authority to
reject standards based on economic
impacts. (Joint Comment, No. 44 at
appendix B, p. 1; Earthjustice, Public
Meeting Transcript, No. 40.5 at p. 130)
The Joint Comment claimed that in 42
U.S.C. 6295(o)(2)(B)(iii), Congress
erected a significant barrier to DOE’s
rejection, on the basis of economic
justifiability, of standard levels to which
the rebuttable presumption applies.
These commenters also claimed that the
fact that DOE seems to prefer to proceed
under the seven-factor test contained in
42 U.S.C. 6295(o)(2)(B)(i) is not
pertinent. The Joint Comment agreed
with DOE that analysis under the seven
factor test is necessary and has typically
supported standards with paybacks
longer than 3 years. However, the Joint
Comment stated that DOE’s decisionmaking must reflect the expressed intent
of Congress that the highest standard
level resulting in cost recovery within 3
years constitutes the presumptive
lowest standard level that DOE must
adopt (Joint Comment, No. 44 at
appendix B, pp. 1–2)
DOE does consider both the rebuttable
presumption payback criteria, as well as
a full analysis including all seven
relevant statutory criteria under 42
U.S.C. 6295(o)(2)(B)(i) when examining
potential standard levels. However, DOE
believes that the commenters are
misinterpreting the statutory provision
in question. The Joint Comment and
Earthjustice present one possible
reading of an ambiguous provision (i.e.,
that DOE need not look beyond the
results of the rebuttable presumption
inquiry), but DOE believes that such an
approach is neither required nor
appropriate, because it would ask the
agency to potentially ignore other
relevant information that would bear on
the selection of the most stringent
standard level that meets all applicable
statutory criteria. The commenters’
interpretation would essentially restrict
DOE from being able to rebut the
findings of the preliminary presumptive
analysis. However, the statute contains
no such restriction, and such an
approach would hinder DOE’s efforts to
base its regulations on the best available
information.
Similarly, DOE believes that the Joint
Comment misreads the statute in calling
for a level that meets the rebuttable
presumption test to serve as a minimum
level when setting the final energy
conservation standard. To do so would
not only eliminate the ‘‘rebuttable’’
aspect of the presumption but would
also lock in place a level that may not
be economically justified based upon
16061
the full complement of statutory criteria.
DOE is already obligated under EPCA to
select the most stringent standard level
that meets the applicable statutory
criteria, so there is no need to tie the
same requirement to the rebuttable
presumption.
D. National Impact Analysis—National
Energy Savings and Net Present Value
1. General
DOE’s NIA assesses the national
energy savings, as well as the national
NPV of total consumer costs and
savings, expected to result from new
standards at specific efficiency levels.
DOE applied the NIA spreadsheet to
perform calculations of energy savings
and NPV using the annual energy
consumption and total installed cost
data from the LCC analysis. DOE
forecasted the energy savings, energy
cost savings, product costs, and NPV for
each product class from 2012 through
2042. The forecasts provide annual and
cumulative values for all four
parameters. In addition, DOE
incorporated into its NIA spreadsheet
the ability to analyze sensitivity of the
results to forecasted energy prices and
product efficiency trends.
Table IV.3 summarizes the approach
and data DOE used to derive the inputs
to the NES and NPV analyses for the
October 2008 NOPR and the changes
made in the analyses for today’s final
rule. A discussion of the inputs and the
changes follows. (See chapter 11 of the
TSD accompanying this notice for
further details.)
TABLE IV.3—APPROACH AND DATA USED TO DERIVE THE INPUTS TO THE NATIONAL ENERGY SAVINGS AND NPV
ANALYSES
Inputs
October 2008 NOPR
Shipments ............................
Effective Date of Standard ...
Base-Case Forecasted Efficiencies.
Annual shipments from Shipments Model ......................
2012 ................................................................................
Shipment-weighted efficiency (SWEF) determined in
the year 2005. SWEF held constant over forecast period of 2005–2042.
‘‘Roll-up’’ scenario used for determining SWEF in the
year 2012 for each standards case. SWEF held constant over forecast period of 2012–2042.
Annual weighted-average values as a function of
SWEF.
Annual weighted-average values as a function of
SWEF.
Annual weighted-average values a function of the annual energy consumption per unit and energy prices.
Incorporated changes in repair costs for non-standing
pilot ignition systems.
AEO2008 forecasts (to 2030) and extrapolation to 2042
Standards-Case Forecasted
Efficiencies.
Annual Energy Consumption
per Unit.
Total Installed Cost per Unit
Energy Cost per Unit ...........
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Repair Cost and Maintenance Cost per Unit.
Escalation of Energy Prices
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See Table IV.4.
No change.
No change.
No change.
No change.
No change.
No change.
No change.
Updated to AEO2009 Early Release forecasts for the
Reference Case. AEO2009 Early Release does not
provide High-Growth and Low-Growth forecasts;
scaled AEO2008 High-Growth and Low-Growth forecasts by the ratio of AEO2009 and AEO2008 Reference Case forecasts to estimate high-growth and
low-growth price trends.
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Federal Register / Vol. 74, No. 66 / Wednesday, April 8, 2009 / Rules and Regulations
TABLE IV.3—APPROACH AND DATA USED TO DERIVE THE INPUTS TO THE NATIONAL ENERGY SAVINGS AND NPV
ANALYSES—Continued
Inputs
October 2008 NOPR
Energy Site-to-Source Conversion.
Conversion varies yearly and is generated by DOE/
EIA’s National Energy Modeling System (NEMS) program (a time-series conversion factor; includes electric generation, transmission, and distribution losses).
Determined but found not to be significant .....................
No change.
3 and 7 percent real ........................................................
Future expenses are discounted to year 2007 ...............
No change.
No change.
Effect of Standards on Energy Prices.
Discount Rate ......................
Present Year ........................
2. Shipments
The shipments portion of the NIA
spreadsheet is a model that uses
historical data as a basis for projecting
future shipments of the appliance
products that are the subject of this
rulemaking. In projecting shipments,
DOE accounted for three market
segments: (1) New construction, (2)
Changes for the final rule
No change.
existing buildings (i.e., replacing failed
products), and (3) early replacements.
DOE used the early replacement market
segment to calibrate the shipments
model to historical shipments data. For
purposes of estimating the impacts of
prospective standards on product
shipments (i.e., forecasting standardscase shipments), DOE considered the
combined effects of changes in purchase
price, annual operating cost, and
household income on the magnitude of
shipments.
Table IV.4 summarizes the approach
and data DOE used to derive the inputs
to the shipments analysis for the
October 2008 NOPR and the changes it
made for today’s final rule. A discussion
of the inputs and the changes follows.
TABLE IV.4—APPROACH AND DATA USED TO DERIVE THE INPUTS TO THE SHIPMENTS ANALYSIS
Inputs
October 2008 NOPR
Number of Product Classes
Seven classes for conventional cooking products; one
class for microwave ovens.
Determined by multiplying housing forecasts by forecasted saturation of cooking products for new housing. Housing forecasts based on AEO2008 projections. New housing product saturations based on
EIA’s 2001 RECS. Forecasted saturations maintained
at 2001 levels.
New Construction Shipments
Replacements ......................
Early Replacements .............
Historical Shipments ............
Purchase Price, Operating
Cost, and Household Income Impacts Due to Efficiency Standards.
Fuel Switching ......................
Determined by tracking total product stock by vintage
and establishing the failure of the stock using retirement functions from the LCC and PBP analysis. Retirement functions revised to be based on Weibull
lifetime distributions.
Used to calibrate Shipments Model to historical shipments data; 2 percent of the surviving stock per year
is retired early.
Data sources include AHAM data submittal, AHAM Fact
Book,24 and Appliance Magazine.
For microwave ovens only, used purchase price and efficiency data specific to residential refrigerators,
clothes washers, and dishwashers between 1980 and
2002 to determine a ‘‘relative price’’ elasticity of demand.
Not considered ................................................................
mstockstill on PROD1PC66 with RULES2
a. New Construction Shipments
To determine new construction
shipments, DOE used a forecast of
housing starts coupled with product
market saturation data for new housing.
For new housing completions and
mobile home placements, DOE adopted
the projections from EIA’s AEO2008
through 2030 for the October 2008
NOPR. For today’s final rule, DOE used
24 Association of Home Appliance Manufacturers,
2005 Major Appliance Fact Book. Available for
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No change.
No change in approach. Housing forecasts updated
with EIA AEO2009 Early Release forecasts for the
Reference Case. AEO2009 Early Release does not
provide High-Growth and Low-Growth forecasts,
Scaled AEO2008 High-Growth and Low-Growth forecasts by the ratio of AEO2009 and AEO2008 Reference Case forecasts to estimate high-growth and
low-growth housing trends.
No change.
No change.
No change.
No change.
No change.
the projections from EIA’s AEO2009
Early Release Reference Case. Because
EIA had not yet released the 2005 RECS
when the analysis was performed, DOE
continued to use the 2001 RECS to
establish cooking product market
saturations for new housing.
b. Replacements
DOE estimated replacements using
product retirement functions developed
from product lifetimes. For the October
2008 NOPR and today’s final rule, DOE
used retirement functions based on
Weibull distributions.
To calibrate each shipments model
against historical shipments, DOE
established an early replacement market
segment. For the October 2008 NOPR
and today’s final rule, DOE determined
that 2 percent of the surviving stock per
year was replaced early.
purchase at https://www.aham.org/ht/d/Product
Details/sku/40471101603.
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c. Purchase Price, Operating Cost, and
Household Income Impacts
To estimate the combined effects on
microwave oven shipments of increases
in product purchase price and decreases
in product operating costs due to new
efficiency standards, DOE conducted a
literature review and a statistical
analysis on appliance price, efficiency,
and shipments data for the October 2008
NOPR. DOE used purchase price and
efficiency data specific to residential
refrigerators, clothes washers, and
dishwashers between 1980 and 2002
from AHAM Fact Books 25 to conduct
regression analyses. DOE chose this
particular set of appliances because of
the availability of data to determine a
price elasticity. These data indicate that
there has been a rise in appliance
shipments and a decline in appliance
purchase price and operating costs over
the time period. Household income has
also risen during this time. To simplify
the analysis, DOE combined the
available economic information into one
variable, termed the ‘‘relative price,’’
and used this variable in an analysis of
market trends and to conduct a
regression analysis. DOE’s regression
analysis suggests that the relative shortrun price elasticity of demand, averaged
over the three appliances, is ¥0.34. For
example, a relative price increase of 10
percent results in a shipments decrease
of 3.4 percent. Because the relative price
elasticity incorporates the impacts from
three effects (i.e., purchase price,
operating cost, and household income),
the impact from any single effect is
mitigated by changes in the other two
effects.
Because DOE’s forecast of shipments
and national impacts due to standards
spans 30 years, DOE also considered
how the relative price elasticity is
affected once a new standard takes
effect. After the purchase price change,
price elasticity becomes more inelastic
over the years until it reaches a terminal
value. For the October 2008 NOPR, DOE
incorporated a relative price elasticity
change that resulted in a terminal value
of approximately one-third of the shortrun elasticity. In other words, DOE
determined that consumer purchase
decisions become less sensitive over
time to the initial change in the
product’s relative price. As
implemented in the modeling of
shipments forecasts, DOE estimates that
the initial increase in purchase price
due to a standard will have a more
significant impact on product shipments
in the short term than over the long term
25 DOE used average purchase price and
efficiency data provided in the 1987, 1988, 1993,
1995, 2000, and 2003 Fact Books.
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(i.e., fewer consumers will forego
appliance purchases years after the
standards have been in place than when
the standards initially take effect.) DOE
received no comments on its analysis to
estimate the combined effects of
increases in product purchase price and
decreases in operating costs on
microwave oven shipments and,
therefore, retained the approach for the
final rule.
In contrast, DOE determined that the
combined market of conventional
electric and gas cooking products (i.e.,
other than microwave ovens) is
completely saturated. Thus, DOE
assumed for the October 2008 NOPR
that the considered standard levels
would neither affect shipments nor
cause shifts in electric and gas
conventional cooking product market
shares. 73 FR 62034, 62071 (Oct. 17,
2008). Because DOE received no
comments on its approach, it continued
to use it for today’s final rule.
d. Fuel Switching
In the October 2008 NOPR, DOE
concluded that the probability that the
considered standard levels would cause
shifts in electric and gas conventional
cooking product market shares was
sufficiently low that it was not
necessary to consider it. 73 FR 62034,
62071–72 (Oct. 17, 2008). DOE received
no comments on this issue and,
therefore, retained the approach for
today’s final rule.
3. Other Inputs
a. Base-Case Forecasted Efficiencies
A key input to the calculations of NES
and NPV are the energy efficiencies that
DOE forecasts for the base case (without
new standards). The forecasted
efficiencies represent the annual
shipment-weighted energy efficiency
(SWEF) of the products under
consideration over the forecast period
(i.e., from the estimated effective date of
a new standard to 30 years after that
date).
For the October 2008 NOPR, DOE first
determined the distribution of product
efficiencies currently in the marketplace
to develop a SWEF for each product
class for 2005. Using the SWEF as a
starting point, DOE developed base-case
efficiencies based on estimates of future
efficiency increase. From 2005 to 2012
(2012 being the estimated effective date
of a new standard), DOE estimated that
there would be no change in the SWEF
(i.e., no change in the distribution of
product efficiencies). Because there are
no historical data to indicate how
product efficiencies have changed over
time, DOE estimated that forecasted
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16063
efficiencies would remain at the 2012
level until the end of the forecast
period, with one exception. Because
historical data indicates a declining
trend in the percentage of gas standard
ranges equipped with standing pilot
lights, DOE did forecast a decline in the
market share of gas standard ranges
equipped with standing pilot lights both
to 2012 and after 2012. DOE recognizes
the possibility that product efficiencies
may change over time (e.g., due to
voluntary efficiency programs such as
ENERGY STAR), but without historical
information, DOE had no basis for
estimating how much the product
efficiencies may change. Thus, for the
final rule, DOE maintained its forecast
that efficiencies remain at the level
estimated for 2012 for residential
cooking products.
b. Standards-Case Forecasted
Efficiencies
For its determination of each of the
cases with alternative standard levels
(‘‘standards cases’’), DOE used a ‘‘rollup’’ scenario to establish the SWEF for
2012. DOE assumed that product
efficiencies in the base case that do not
meet the standard level under
consideration would roll up to meet the
new standard level. Also, DOE assumed
that all product efficiencies in the base
case that were above the standard level
under consideration would not be
affected by the standard. DOE made the
same assumption regarding forecasted
standards-case efficiencies as for the
base case, namely, that forecasted
efficiencies remained at the 2012
efficiency level until the end of the
forecast period.
Again, DOE had no data to reasonably
estimate how such efficiency levels
might change over the next 30 years. By
maintaining the same rate of increase for
forecasted efficiencies in the standards
case as in the base case (i.e., no change),
DOE retained a constant efficiency
difference between the two cases over
the forecast period. Although the
assumed no-change trends may not
reflect what would happen to base-case
and standards-case product efficiencies
in the future, DOE believes that
maintaining a constant efficiency
difference between the base case and
standards case provides a reasonable
estimate of the impact that standards
have on product efficiency. It is more
important to accurately estimate the
efficiency difference between the
standards case and base case than to
accurately estimate the actual product
efficiencies in the standards and base
cases. Therefore, DOE retained the
approach used in the October 2008
NOPR for the final rule.
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c. Annual Energy Consumption
The annual energy consumption per
unit depends directly on product
efficiency. DOE used the SWEFs
associated with the base case and each
standards case, in combination with the
annual energy data, to estimate the
shipment-weighted average annual perunit energy consumption under the base
case and standards cases. The national
energy consumption is the product of
the annual energy consumption per unit
and the number of units of each vintage,
which depends on shipments.
As noted in section IV.D.2.c, DOE
used a relative price elasticity to
estimate standards-case shipments for
microwave ovens, but not for
conventional cooking products. As a
result, shipments of microwave ovens
forecasted under the standards cases are
lower than under the base case. To
avoid the inclusion of energy savings
from reduced shipments of microwave
ovens, DOE used the standards-case
shipments projection and the standardscase stock to calculate the annual energy
consumption for the standards cases.
d. Site-to-Source Conversion
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To estimate the national energy
savings expected from appliance
standards, DOE uses a multiplicative
factor to convert site energy
consumption (energy use at the location
where the appliance is operated) into
primary or source energy consumption
(the energy required to deliver the site
energy). In the case of electrical energy,
primary consumption includes the
energy required for generation,
transmission, and distribution. For the
October 2008 NOPR and today’s final
rule, DOE used annual site-to-source
conversion factors based on the version
of NEMS that corresponds to AEO2008.
These conversion factors account for
natural gas losses from pipeline leakage
and natural gas used for pumping
energy and transportation fuel. For
electricity, the conversion factors vary
over time due to projected changes in
generation sources (i.e., the power plant
types projected to provide electricity to
the country). Since the AEO does not
provide energy forecasts beyond 2030,
DOE used conversion factors that
remain constant at the 2030 values
throughout the remainder of the
forecast.
e. Total Installed Costs and Operating
Costs
The increase in total annual installed
cost is equal to the difference in the perunit total installed cost between the
base case and standards case, multiplied
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by the shipments forecasted in the
standards case.
The annual operating cost savings per
unit includes changes in energy, repair,
and maintenance costs. DOE forecasted
energy prices for the October 2008
NOPR based on AEO2008; it updated
the forecasts for the final rule using data
from AEO2009 Early Release. For the
October 2008 NOPR and today’s final
rule, DOE accounted for the repair and
maintenance costs associated with the
ignition systems in gas cooking
products.
f. Discount Rates
DOE multiplies monetary values in
future years by the discount factor to
determine their present value. DOE
estimated national impacts using 3- and
7-percent real discount rates, in
accordance with guidance provided by
the Office of Management and Budget
(OMB) to Federal agencies on the
development of regulatory analysis
(OMB Circular A–4 (Sept. 17, 2003),
section E, ‘‘Identifying and Measuring
Benefits and Costs’’).
The Joint Comment stated that DOE
should use a 2- to 3-percent real
discount rate for the national impact
analyses. (Joint Comment, No. 44 at p.
11) It noted that societal discount rates
are the subject of extensive academic
research and the weight of academic
opinion is that the appropriate societal
discount rate is 3 percent or less. It
urged DOE to give primary weight to
results based on the lower of the
discount rates recommended by OMB.
On this point, DOE notes that OMB
Circular A–4 references an earlier
Circular A–94, which states that a real
discount rate of 7 percent should be
used as a base case for regulatory
analysis. The 7-percent rate is an
estimate of the average before-tax rate of
return to private capital in the U.S.
economy. It approximates the
opportunity cost of capital and,
according to Circular A–94, is the
appropriate discount rate whenever the
main effect of a regulation is to displace
or alter the use of capital in the private
sector. OMB revised Circular A–94 in
1992 after extensive internal review and
public comment. OMB found that the
average rate of return to capital remains
near the 7-percent rate estimated in
1992. Circular A–4 also states that when
regulation primarily and directly affects
private consumption, a lower discount
rate is appropriate. ‘‘The alternative
most often used is sometimes called the
social rate of time preference * * * the
rate at which ‘society’ discounts future
consumption flows to their present
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value.’’ 26 It suggests that the real rate of
return on long-term government debt
may provide a fair approximation of the
social rate of time preference, and states
that over the last 30 years, this rate has
averaged around 3 percent in real terms
on a pre-tax basis. It concludes that ‘‘for
regulatory analysis, [agencies] should
provide estimates of net benefits using
both 3 percent and 7 percent.’’ 27 DOE
finds that the guidance from OMB is
reasonable, and thus it did not give
primary weight to results derived using
a 3-percent discount rate.
The Joint Comment stated that DOE
should not apply a discount rate to
physical units of measure, such as tons
of emissions or quads of energy. (Joint
Comment, No. 44 at p. 11) Consistent
with Executive Order 12866,
‘‘Regulatory Planning and Review,’’ 58
FR 51735, 51737 (Oct. 4, 1993), DOE
discounts the monetized value of these
emissions reductions using 3-percent
and 7-percent discount rates in order to
determine their present value for
rulemaking purposes. Similarly, DOE
discounts energy savings using 3percent and 7-percent discount rates
since the timing of the energy savings,
like money saved, have value to
consumers and the Nation. DOE
recognizes that while financial
investments can grow with time,
physical quantities such as energy do
not, so there are costs and benefits to the
Nation associated with the timing of
when of consuming the energy. In doing
so, DOE follows the guidance of OMB
regarding methodologies and
procedures for regulatory impact
analysis that affect more than one
agency. Thus, DOE has reported both
discounted and undiscounted values for
the energy and environmental benefits
from energy conservation standards.
g. Effects of Standards on Energy Prices
For the October 2008 NOPR, DOE
conducted an analysis of the impact of
reduced energy demand associated with
possible standards on cooking products
on natural gas and electricity prices.
The analysis found that gas and electric
demand reductions resulting from maxtech standards for residential cooking
products would have no detectable
change on the U.S. average wellhead
natural gas price or the average user
price of electricity. Therefore, DOE
concluded that residential cooking
26 OMB Circular A–4, ‘‘Regulatory Analysis,’’
Sept. 17, 2003, p. 33. Please see the following Web
site for further information: https://
www.whitehouse.gov/omb/circulars/.
27 OMB Circular A–4, ‘‘Regulatory Analysis,’’
Sept. 17, 2003, p. 34. Please see the following Web
site for further information: https://
www.whitehouse.gov/omb/circulars/.
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product standards will not provide
additional economic benefits resulting
from lower energy prices.
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E. Consumer Subgroup Analysis
In analyzing the potential impact of
new or amended standards on
individual consumers, DOE evaluates
the impact on identifiable subgroups of
consumers that may be
disproportionately affected by a national
standard level. For the October 2008
NOPR, DOE used RECS data to analyze
the potential effect of standards for
residential cooking products on two
consumer subgroups: (1) Households
with low income levels, and (2)
households comprised of seniors.
DOE also considered specific
consumer subgroups that do not use or
have access to electricity and could be
affected by the elimination of standing
pilot ignition systems, such as Amish
and some Native American
communities. DOE’s market research for
the October 2008 NOPR found that
battery-powered electronic ignition
systems have been implemented in
other products, such as instantaneous
gas water heaters, barbeques, and
furnaces, and the use of such products
is not expressly prohibited by
applicable safety standards such as
ANSI Z21.1. As noted in section III.C.2,
DOE’s research determined that,
although there are currently no
alternative ignition systems to standing
pilots in gas cooking products that have
been certified to ANSI Z21.1, DOE
believes such certification could be
attained and that gas cooking products
suitable for households without
electricity would likely be commercially
available by the time these standards are
in effect.
More details on the consumer
subgroup analysis can be found in
chapter 12 of the TSD accompanying
this notice.
F. Manufacturer Impact Analysis
In determining whether a standard for
cooking products is economically
justified, the Secretary of Energy is
required to consider ‘‘the economic
impact of the standard on the
manufacturers and on the consumers of
the products subject to such standard.’’
(42 U.S.C. 6295(o)(2)(B)(i)(I)) The statute
also calls for an assessment of the
impact of any lessening of competition
as determined by the Attorney General.
(42 U.S.C. 6295(o)(2)(B)(i)(V)) DOE
conducted the MIA to estimate the
financial impact of higher efficiency
standards on manufacturers of cooking
products, and to assess the impact of
such standards on employment and
manufacturing capacity.
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The MIA has both quantitative and
qualitative aspects. The quantitative
part of the MIA relies on the GRIM, an
industry cash-flow model customized
for this rulemaking. The GRIM inputs
characterize the industry cost structure,
shipments, and revenues. This includes
information from many of the analyses
described above, such as manufacturing
costs and prices from the engineering
analysis and shipments forecasts. The
key GRIM output is the INPV, which
estimates the value of the industry on
the basis of cash flows, expenditures,
and investment requirements as a
function of TSLs. Different sets of
assumptions (scenarios) will produce
different results. The qualitative part of
the MIA addresses factors such as
product characteristics, characteristics
of particular firms, and market and
product trends, and it includes an
assessment of the impacts of standards
on subgroups of manufacturers that
could be disproportionately affected by
these standards.
For the October 2008 NOPR, DOE
identified three manufacturers of gasfired ovens, ranges, and cooktops with
standing pilot lights. Two of the three
are classified as small businesses under
criteria prescribed by the Small
Business Administration (SBA).28 The
SBA classifies a residential cooking
appliance manufacturer as a small
business if it has fewer than 750
employees. DOE categorized the two
small businesses into their own
subgroup as a result of their size and
their concentration in the manufacture
of residential cooking products. Each
small manufacturer produces gas-fired
cooking products with standing pilot
ignition systems and derives over 25
percent of its total revenue from these
appliances. Both small manufacturers
produce only residential cooking
appliances and have annual sales of $50
million to $60 million, whereas the
third is a large, diversified appliance
manufacturer. The two small cooking
businesses are privately held and each
company has fewer than 300 employees.
73 FR 62034, 62076 (Oct. 17, 2008).
DOE interviewed one of these
manufacturers, and also obtained from
larger manufacturers information about
the impacts of standards on these small
manufacturers of conventional cooking
products. 73 FR 62034, 62128 (Oct. 17,
2008). In addition, DOE received
comments from one of the small
manufacturers regarding the potential
impacts of standards. (Peerless-Premier,
No. 42 at pp. 1–2) See section VII.B for
28 For more information, see https://www.sba.gov/
idc/groups/public/documents/sba_homepage/serv_
sstd_tablepdf.pdf.
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a discussion of DOE’s determination of
the economic impacts of today’s final
rule on small entities.
For the final rule, DOE updated the
MIA results based on the total
shipments and efficiency distributions
estimated in the final rule NIA. For
details of the MIA, see chapter 13 of the
TSD accompanying this notice.
G. Employment Impact Analysis
Employment impacts include direct
and indirect impacts. Direct
employment impacts are changes in the
number of employees for manufacturers
of the appliance products that are
subject to standards, their suppliers, and
related service firms. The MIA
addresses these impacts. Indirect
employment impacts from standards
consist of the jobs created or eliminated
in the national economy, other than in
the manufacturing sector being
regulated, due to (1) reduced spending
by end users on energy, (2) reduced
spending on new energy supply by the
utility industry, (3) increased consumer
spending on the purchase of new
products, and (4) the effects of those
three factors throughout the economy.
In developing the October 2008 NOPR
and today’s final rule, DOE estimated
indirect national employment impacts
using an input/output model of the U.S.
economy called Impact of Sector Energy
Technologies (ImSET). ImSET 29 is a
spreadsheet model of the U.S. economy
that focuses on 188 sectors most
relevant to industrial, commercial, and
residential building energy use. ImSET
is a special-purpose version of the ‘‘U.S.
Benchmark National Input-Output’’
(I–O) model designed to estimate the
national employment and income
effects of energy-saving technologies.
The ImSET software includes a
computer-based I–O model with
structural coefficients to characterize
economic flows among the 188 sectors.
ImSET’s national economic I–O
structure is based on a 1997 U.S.
benchmark table, especially aggregated
to those sectors. For further details, see
chapter 15 of the TSD accompanying
this notice.
The Joint Comment stated that when
weighing the economic costs and
benefits of stronger efficiency standards,
DOE must consider that adopting
standards will increase employment.
(Joint Comment, No. 44 at p. 13) As
described in section VI.C.3, DOE uses
ImSet to consider indirect employment
29 Roop, J. M., M. J. Scott, and R. W. Schultz,
ImSET: Impact of Sector Energy Technologies
(PNNL–15273 Pacific Northwest National
Laboratory) (2005). Available at https://
www.pnl.gov/main/publications/external/
technical_reports/PNNL-15273.pdf.
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impacts when evaluating alternative
standard levels. Direct employment
impacts on the manufacturers that
produce cooking products are analyzed
in the manufacturer impact analysis, as
discussed in section IV.F.
H. Utility Impact Analysis
The utility impact analysis
determines the changes to energy
supply and demand that result from the
end-use energy savings due to
standards. DOE calculated these
changes using the NEMS–BT computer
model.30 The analysis output includes a
forecast of the total electricity
generation capacity at each TSL.
DOE obtained the energy savings
inputs associated with electricity and
natural gas consumption savings from
the NIA. Chapter 14 of the TSD
accompanying this notice presents
details on the utility impact analysis.
I. Environmental Assessment
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DOE prepared an environmental
assessment (EA) pursuant to the
National Environmental Policy Act and
the requirements of 42 U.S.C.
6295(o)(2)(B)(i)(VI) to determine the
environmental impacts of standards for
cooking products. Specifically, DOE
estimated the reduction in total
emissions of CO2 and NOX using the
NEMS–BT computer model. DOE also
calculated a range of estimates for
reduction in mercury (Hg) emissions
using power sector emission rates. DOE
also calculated the possible monetary
benefit of CO2, NOX, and Hg reductions.
Cumulative monetary benefits were
determined using discount rates of 3
and 7 percent. The EA does not include
the estimated reduction in power sector
impacts of sulfur dioxide (SO2), because
DOE has determined that any such
reduction resulting from an energy
conservation standard would not affect
the overall level of SO2 emissions in the
United States due to the presence of
national caps on SO2 emissions. These
topics are addressed further below; see
chapter 16 of the TSD for additional
detail.
NEMS–BT is run similarly to the
AEO2008 NEMS, except that cooking
product energy use is reduced by the
30 EIA approves the use of the name NEMS to
describe only an official AEO version of the model
without any modification to code or data. Because
the present analysis entails some minor code
modifications and runs the model under various
policy scenarios that deviate from AEO
assumptions, the name NEMS–BT refers to the
model as used here. (‘‘BT’’ stands for DOE’s
Building Technologies Program.) For more
information on NEMS, refer to ‘‘The National
Energy Modeling System: An Overview,’’ DOE/EIA–
0581 (98) (Feb. 1998). Available at https://
tonto.eia.doe.gov/ftproot/forecasting/058198.pdf.
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amount of energy saved (by fuel type)
due to the trial standard levels. The
inputs of national energy savings come
from the NIA analysis. For the EA, the
output is the forecasted physical
emissions. The net benefit of a standard
is the difference between emissions
estimated by NEMS–BT and the
AEO2008 Reference Case. The NEMS–
BT tracks CO2 emissions using a
detailed module that provides results
with broad coverage of all sectors and
inclusion of interactive effects.
The Clean Air Act Amendments of
1990 set an emissions cap on SO2 for all
power generation. The attainment of the
emissions cap is flexible among
generators and is enforced through the
use of emissions allowances and
tradable permits. Because SO2 emissions
allowances have value, they will almost
certainly be used by generators,
although not necessarily immediately or
in the same year a standard is in place.
In other words, with or without a
standard, total cumulative SO2
emissions will always be at or near the
ceiling, and there may be some timing
differences among yearly forecasts.
Thus, it is unlikely that there will be
reduced overall SO2 emissions from
standards as long as the emissions
ceilings are enforced. Although there
may be no actual reduction in SO2
emissions, there still may be an
economic benefit from reduced demand
for SO2 emission allowances. Electricity
savings decrease the generation of SO2
emissions from power production,
which can lessen the need to purchase
SO2 emissions allowance credits, and
thereby decrease the costs of complying
with regulatory caps on emissions.
Future emissions of NOX would have
been subject to emissions caps under
the Clean Air Interstate Rule (CAIR)
issued by the U.S. Environmental
Protection Agency on March 10, 2005.31
70 FR 25162 (May 12, 2005). CAIR
would have permanently capped
emissions in 28 eastern States and the
District of Columbia (D.C.). As with the
SO2 emissions cap, a cap on NOX
emissions would have meant that
energy conservation standards are not
likely to have a physical effect on NOX
emissions in States covered by the CAIR
caps. However, prior to the publication
of the October 2008 NOPR, the CAIR
was vacated by the U.S. Court of
Appeals for the District of Columbia
Circuit (DC Circuit) in its July 11, 2008
decision in North Carolina v.
Environmental Protection Agency.32
Therefore, for the October 2008 NOPR,
DOE established a range of NOX
31 See
32 531
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F.3d 896 (D.C. Cir. 2008).
Frm 00028
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reductions based on low and high
emission rates (in metric kilotons of
NOX emitted per terawatt-hour (TWh) of
electricity generated) derived from the
AEO2008. However, on December 23,
2008, the DC Circuit decided to allow
CAIR to remain in effect until it is
replaced by a rule consistent with the
court’s earlier opinion.33 As a result,
DOE used the NEMS–BT model for
today’s final rule to estimate the NOX
emissions reductions due to standards.
For the 28 eastern States and DC where
CAIR is in effect, no NOX emissions
reductions will occur due to the
permanent cap. Under caps, physical
emissions reductions in those States
would not result from the energy
conservation standards under
consideration by DOE, but standards
might have produced an
environmentally related economic
impact in the form of lower prices for
emissions allowance credits, if they
were large enough. However, DOE
determined that in the present case,
such standards would not produce an
environmentally related economic
impact in the form of lower prices for
emissions allowance credits, because
the estimated reduction in NOX
emissions or the corresponding
allowance credits in States covered by
the CAIR cap would be too small to
affect allowance prices for NOX under
the CAIR. In contrast, new or amended
energy conservation standards would
reduce NOX emissions in those 22 States
that are not affected by CAIR. As a
result, the NEMS–BT does forecast
emission reductions from the cooking
product standards considered in today’s
final rule.
Similar to SO2 and NOX, future
emissions of Hg would have been
subject to emissions caps under the
Clean Air Mercury Rule 34 (CAMR),
which would have permanently capped
emissions of mercury for new and
existing coal-fired plants in all States by
2010, but the CAMR was vacated by the
D.C. Circuit in its decision in New Jersey
v. Environmental Protection Agency 35
prior to publication of the October 2008
NOPR. However, the NEMS–BT model
DOE used to estimate the changes in
emissions for the proposed rule
assumed that Hg emissions would be
subject to CAMR emission caps.
Because the emissions caps specified by
CAMR would have applied to the entire
country, DOE was unable to use the
NEMS–BT model to estimate any
changes in the quantity of mercury
33 North Carolina v. EPA, 550 F.3d 1176 (D.C. Cir.
2008).
34 70 FR 28606 (May 18, 2005).
35 517 F 3d 574 (D.C. Cir. 2008).
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emissions that would result from
standard levels it considered for the
proposed rule. Instead, DOE used an Hg
emission rate (in metric tons of Hg per
energy produced) based on the
AEO2008. Because virtually all mercury
emitted from electricity generation is
from coal-fired power plants, DOE based
the emission rate on the metric tons of
mercury emitted per TWh of coalgenerated electricity. To estimate the
reduction in mercury emissions, DOE
multiplied the emission rate by the
reduction in coal-generated electricity
associated with the standards
considered. Because the CAMR has been
vacated, DOE continued to use the
approach it used for the October 2008
NOPR to estimate the Hg emission
reductions due to standards for today’s
final rule.
In addition to electricity, the
operation of gas cooking products
requires use of fossil fuels and results in
emissions of CO2 and NOX at the sites
where the appliances are used. NEMS–
BT provides no means for estimating
such emissions. Therefore, DOE
calculated separate estimates of the
effect of the potential standards on site
emissions of CO2 and NOX based on
emissions factors derived from the
literature. Natural gas was the only
fossil fuel DOE accounted for in its
analysis of standards for cooking
products. Because natural gas
combustion does not yield SO2
emissions, DOE did not report the effect
of the proposed standards on site
emissions of SO2.
For the October 2008 NOPR, DOE
monetized reductions in CO2 emissions
due to standards based on a range of
monetary values drawn from studies
that attempt to estimate the present
value of the marginal economic benefits
likely to result from reducing
greenhouse gas emissions. Several
parties provided comments regarding
the economic valuation of CO2 for the
October 2008 NOPR. Whirlpool did not
support an attempt to value those
emissions as part of this rulemaking.
(Whirlpool, No. 50 at p. 8) EEI
commented that utilities have
embedded the cost of complying with
existing environmental legislation in
their price for electricity, and a similar
approach may be reasonable for valuing
reduced CO2 emissions. (EEI, Public
Meeting Transcript, No. 40.5 at pp. 194–
195) The Joint Comment stated that
DOE’s valuation of avoided CO2
emissions should use EIA’s analysis of
the Climate Security Act; the core
scenario of this analysis yields a $17
price per ton of CO2, with an annual 7.4
percent increase. (Joint Comment, No.
44 at p. 12) As discussed in section
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VI.C.6, DOE has continued to use the
approach described in the October 2008
NOPR (73 FR 62034, 62107 (Oct. 17,
2008)) for its monetization of
environmental emissions reductions for
today’s rule.
Although this rulemaking does not
affect SO2 emissions or NOX emissions
in the 28 eastern States and D.C. where
CAIR is in effect, there are markets for
SO2 and NOX emissions allowances.
The market clearing price of SO2 and
NOX emissions allowances is roughly
the marginal cost of meeting the
regulatory cap, not the marginal value of
the cap itself. Further, because national
SO2 and NOX emissions are regulated by
a cap-and-trade system, the cost of
meeting these caps is included in the
price of energy. Thus, the value of
energy savings already includes the
value of SO2 and NOX control for those
consumers experiencing energy savings.
The economic cost savings associated
with SO2 and NOX emissions caps is
approximately equal to the change in
the price of traded allowances resulting
from energy savings multiplied by the
number of allowances that would be
issued each year. That calculation is
uncertain because the energy savings
from new or amended standards for
cooking products would be so small
relative to the entire electricity
generation market that the resulting
emissions savings would have almost no
impact on price formation in the
allowances market. These savings
would most likely be outweighed by
uncertainties in the marginal costs of
compliance with SO2 and NOX
emissions caps.
V. Discussion of Other Comments
Since DOE opened the docket for this
rulemaking, it has received more than
42 comments from a diverse set of
parties, including manufacturers and
their representatives, members of
Congress, energy conservation
advocates, private citizens, and electric
and gas utilities. Comments on the
analytic methodologies DOE used are
discussed in section IV of this preamble.
Other comments DOE received in
response to the October 2008 NOPR,
limited to those pertaining to standards
for cooking products, are addressed in
this section.
A. Burdens and Benefits
1. Consideration of the Value of
Avoided Environmental Impacts
The Joint Comment stated that DOE
has not incorporated the value of CO2
emissions reductions into the LCC and
NPV analyses. The Joint Comment
argues that, because the value of CO2
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16067
emissions reductions affects the
economic justification of standards,
DOE must incorporate these effects into
the LCC and NPV analyses. (Joint
Comment, No. 44 at p. 12)
After consideration of this comment,
DOE decided to continue to report these
benefits separately from the direct
benefits of energy savings (i.e., the NPV
of consumer net benefits). Neither EPCA
nor the National Environmental Policy
Act (NEPA) requires that the economic
value of emissions reductions be
incorporated in the net present value
analysis of energy savings. However,
DOE believes that considering the value
of environmental emissions reductions
separately from other impacts, when
weighing the benefits and burdens of
standards, provides the Department
with a more robust understanding of the
potential impacts of standards.
Similarly, for other emissions
currently not priced (Hg nationwide and
NOX in those States not covered by
CAIR), only ranges of estimated
economic values based on
environmental damage studies of
varying quality and applicability are
available. DOE has also weighed these
values separately from the direct
benefits of energy savings.
B. Other Comments
1. Proposed Standards for Conventional
Cooking Products
The Joint Comment stated that TSL 3
should be adopted for conventional
cooking products rather than TSL 1. The
Joint Comment specifically calls
attention to the standard level for
electric standard ovens under TSL 3,
and states that this standard level
satisfies the rebuttable presumption
payback period. As a result, the Joint
Comment concluded that TSL 3 is
presumptively economically justified.
(Joint Comment, No. 44 at p. 11)
Earthjustice also stated that TSL 3
should be adopted but on grounds that
it provided consumers with an
economic benefit greater than TSL 1.
(Earthjustice, Public Meeting Transcript,
No. 40.5, p. 200)
As described in section VI.A, TSL 3
for conventional cooking products
consists of performance standards for
electric standard ovens, gas selfcleaning ovens, and electric coil
cooktops, in addition to the presciptive
requirements in TSL 1 of eliminating
standing pilots in gas cooktops and gas
standard ovens. Although the
performance standards for electric
standard ovens and electric cooktops at
TSL 3 satisfy the rebuttable
presumption payback period, as noted
in section IV.C.11, DOE considers the
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full range of criteria including impacts
on consumers, manufacturers, and the
environment, when determining
whether these standards are
economically justisfied.
VI. Analytical Results and Conclusions
A. Trial Standard Levels
DOE analyzed the benefits and
burdens of a number of TSLs for the
cooking products that are the subject of
today’s final rule. For the October 2008
NOPR, DOE based the TSLs on
efficiency levels explored in the
November 2007 ANOPR, and selected
the TSLs on consideration of economic
factors and current market conditions.
DOE received no comments on the
composition of the TSLs. Accordingly,
for today’s final rule, DOE considered
the same TSLs it considered for the
October 2008 NOPR.
Table VI.1 shows the TSLs and the
corresponding product class efficiencies
for conventional cooking products. As
discussed in section III.C, DOE
determined the design options that are
technologically feasible and can be
considered as measures to improve
product efficiency. However, as
discussed in chapters 3 and 4 of the
TSD accompanying this notice, there are
few design options available for
improving the efficiency of these
cooking products due to physical
TSL 1, the current prescriptive standard
that prohibits the use of standing pilot
ignition systems in gas cooking pilots
equipped with power cords would be
extended to all gas cooking products,
regardless of whether the appliance is
equipped with a power cord. Under TSL
1, DOE would not regulate the EF of any
of the conventional cooking product
classes and only standing pilot ignition
systems would be affected.
TSL 2 for conventional cooking
products consists of the candidate
standard levels from each of the product
classes that provide an economic benefit
to a majority of consumers who are
affected by the standard. Based on this
criterion, only electric coil cooktops and
electric standard ovens have candidate
standard levels that differ from those in
TSL 1. For the remaining five product
classes, the results indicate that no
candidate standard level provides an
economic benefit to a majority of
consumers.
TSL 3 for conventional cooking
products consists of the same candidate
standard levels as TSL 2, with one
exception: the gas self-cleaning oven
product class. For these ovens, the
design option that provides, on average,
a small level of economic benefit to
consumers is included.
TSL 4 is the maximum
technologically feasible efficiency level.
limitations on energy transfer to the
food being cooked. This is particularly
true for all cooktop and self-cleaning
oven product classes. For electric
cooktops, DOE was able to identify only
a single design change for analysis. For
gas cooktops and electric self-cleaning
ovens, DOE was able to identify two
design options for analysis. For gas selfcleaning ovens, DOE was able to
identify three design options for
analysis. Although DOE considered
several design options for standard
ovens, none significantly increased
product efficiency with the exception of
eliminating standing pilots for gas
standard ovens. Eliminating standing
pilots reduces an oven’s overall gas
consumption by more than 50 percent,
whereas all other design options reduce
gas consumption by approximately 2
percent. Therefore, DOE gave further
consideration to only four TSLs for
conventional cooking products, as
described below.
TSL 1 represents the elimination of
standing pilot ignition systems from gas
cooking products. All other product
classes are unaffected by TSL 1,
including gas self-cleaning ovens. EPCA
does not allow gas self-cleaning ovens to
use standing pilot ignition systems
because they already use electricity and
come equipped with power cords to
enable the self-cleaning cycle. Under
TABLE VI.1—TRIAL STANDARD LEVELS FOR CONVENTIONAL COOKING PRODUCTS
TSLs
Product class
TSL 1
Electric Coil Cooktops ....................................
Electric Smooth Cooktops ..............................
Gas Cooktops ................................................
Electric Standard Ovens ................................
Electric Self-Cleaning Ovens .........................
Gas Standard Ovens .....................................
Gas Self-Cleaning Ovens ..............................
TSL 2
TSL 3
No Standard ...............
No Standard ...............
No Pilot ......................
No Standard ...............
No Standard ...............
No Pilot ......................
No Change to Existing
Standard*.
EF=0.769 ...................
No Standard ...............
No Pilot ......................
EF=0.1163 .................
No Standard ...............
No Pilot ......................
No Change to Existing
Standard*.
EF=0.769 ...................
No Standard ...............
No Pilot ......................
EF=0.1163 .................
No Standard ...............
No Pilot ......................
EF=0.0625 .................
TSL 4
EF=0.769
EF=0.753
EF=0.420
EF=0.1209
EF=0.1123
EF=0.0600
EF=0.0632
* Existing Standard = No Pilot.
mstockstill on PROD1PC66 with RULES2
As discussed in section III.A, DOE has
concluded that it is not technically
feasible to combine cooking efficiency
(or EF) into a new efficiency metric with
standby power consumption in
microwave ovens. For the October 2008
NOPR, DOE considered two sets of
TSLs—one set comprised solely of EF
levels and a second set comprised solely
VerDate Nov<24>2008
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Jkt 217001
of standby power levels. As discussed in
section II.B.3, DOE has decided to
continue this rulemaking to further
consider microwave oven energy
conservation standards pertaining to
standby power consumption. Therefore,
for today’s final rule, DOE is
considering only EF standards for
microwave ovens.
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Table VI.2 shows the TSLs for the
regulation of microwave oven cooking
efficiency, which is expressed in terms
of EF. The TSLs refer only to the EF and
specify no standard regarding standby
power use. TSL 4 corresponds to the
maximum technologically feasible EF
level.
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16069
TABLE VI.2—TRIAL STANDARD LEVELS FOR MICROWAVE OVEN ENERGY FACTOR
TSLs
TSL 1
B. Significance of Energy Savings
To estimate the energy savings
through 2042 attributable to potential
standards, DOE compared the energy
consumption of cooking products under
the base case (no standards) to energy
consumption of these products under
TSL 3
TSL 4
0.586
EF ....................................................................................................................
TSL 2
0.588
0.597
0.602
each standards case (each TSL, or set of
new standards, that DOE has
considered). Tables VI.3 and VI.4 show
DOE’s NES estimates for each TSL for
conventional cooking products and
microwave ovens, respectively. Chapter
11 of the TSD accompanying this notice
describes these estimates in more detail.
In the TSD, DOE reports both
undiscounted and discounted values of
energy savings. Discounted energy
savings represent a policy perspective in
which energy savings farther in the
future are less significant than energy
savings closer to the present.36
TABLE VI.3—CUMULATIVE NATIONAL ENERGY SAVINGS FOR CONVENTIONAL COOKING PRODUCTS
National Energy Savings
quads
TSL
1
2
3
4
Electric
coil
cooktops
.......................................................
.......................................................
.......................................................
.......................................................
Electric
smooth
cooktops
0.00
0.04
0.04
0.04
Gas
cooktops
0.00
0.00
0.00
0.02
Electric
standard
ovens
0.10
0.10
0.10
0.15
Electric
self-clean
ovens
0.00
0.05
0.05
0.07
Gas standard ovens
0.00
0.00
0.00
0.04
0.05
0.05
0.05
0.09
Gas selfclean
ovens
0.00
0.00
0.09
0.10
Total
0.14
0.23
0.32
0.50
under conditions prescribed by the DOE
TABLE VI.4—CUMULATIVE NATIONAL the first three outputs are average LCC
test procedure. While DOE examined
ENERGY SAVINGS FOR MICROWAVE and its components (the average
installed price and the average operating the rebuttable presumption criterion
OVENS (ENERGY FACTOR)
Consumers affected by new or
amended standards usually experience
higher purchase prices and lower
operating costs. Generally, these
impacts are best captured by changes in
life-cycle costs and payback period.
Therefore, DOE calculated the LCC and
PBP for the standard levels considered
in this rulemaking. DOE’s LCC and PBP
analyses provided key outputs for each
TSL, which are reported by product in
Tables VI.5 through VI.12. In each table,
cost). The next four outputs are the
average LCC savings along with the
proportions of purchases of cooking
products under three different scenarios
in which purchasing a product that
complies with the TSL would create (1)
a net life-cycle cost, (2) no impact, or (3)
a net life-cycle savings for the
purchaser.
The last two outputs are the median
and average PBP for the consumer
purchasing a design that complies with
the TSL. The PBP is the number of years
it would take for the purchaser to
recover, as a result of energy savings,
the increased costs of higher efficiency
products based on the operating cost
savings from the first year of ownership.
DOE based its complete PBP analysis for
cooking products on energy
consumption under conditions of actual
use of each type of product by
purchasers. However, as required by
EPCA (42 U.S.C. 6295(o)(2)(B)(iii)), DOE
based the rebuttable presumption PBP
test on consumption as determined
(see TSD chapter 8), it considered
whether the standard levels considered
for today’s rule are economically
justified through a more detailed
analysis of the economic impacts of
these levels pursuant to section
325(o)(2)(B)(i) of EPCA. (42 U.S.C.
6295(o)(2)(B)(i))
Tables VI.5, VI.6, and VI.7 show the
LCC and PBP results for cooktops. To
illustrate the role of the base-case
forecast in the case of gas cooktops
(Table VI.7), TSL 1 shows an average
LCC savings of $15. The average savings
are relatively low because 93.5 percent
of the households in the base case
already purchase a gas cooktop at the
TSL 1 level, and thus have zero savings
due to the standard. In this example, the
base case includes a significant number
of households that would not be
affected by a standard set at TSL 1. DOE
determined the median and average
values of the PBPs shown below by
excluding the households not affected
by the standard.
36 Consistent with Executive Order 12866,
‘‘Regulatory Planning and Review,’’ 58 FR 51735
(Oct. 4, 1993), DOE follows OMB guidance
regarding methodologies and procedures for
regulatory impact analysis that affect more than one
agency. In reporting energy and environmental
benefits from energy conservation standards, DOE
will report both discounted and undiscounted (i.e.,
zero discount rate) values.
TSL
1
2
3
4
National Energy
Savings
quads
........................................
........................................
........................................
........................................
0.18
0.19
0.23
0.25
C. Economic Justification
1. Economic Impact on Consumers
mstockstill on PROD1PC66 with RULES2
a. Life-Cycle Costs and Payback Period
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TABLE VI.5—ELECTRIC COIL COOKTOPS: LIFE-CYCLE COST AND PAYBACK PERIOD RESULTS
Life-cycle cost
TSL
EF
Life-cycle cost savings
Payback period
years
Households with
Average
installed
price
Average
operating
cost
Average
LCC
Average
savings
Net cost
No
impact
Net
benefit
Median
Average
................
................
................
................
................
................
7.2
18.0
Baseline .....................................................
0.737
$272
$183
$455
1 ................................................................
0.737
272
183
455
2, 3, 4 ........................................................
0.769
276
175
451
No change from baseline
$4
27.1%
0.0%
72.9%
TABLE VI.6—ELECTRIC SMOOTH COOKTOPS: LIFE-CYCLE COST AND PAYBACK PERIOD RESULTS
Life-cycle cost
TSL
EF
Life-cycle cost savings
Payback period
years
Households with
Average
installed
price
Average
operating
cost
Average
LCC
Average
savings
Net cost
No
impact
Net
benefit
Median
Average
................
................
................
................
................
................
1,498
3,736
Baseline .....................................................
0.742
$309
$183
$492
1, 2, 3 ........................................................
0.742
309
183
492
4 ................................................................
0.753
550
180
730
No change from baseline
¥$238
100.0%
0.0%
0.0%
TABLE VI.7—GAS COOKTOPS: LIFE-CYCLE COST AND PAYBACK PERIOD RESULTS
Life-cycle cost
TSL
EF
Baseline .................................................
1, 2, 3 ....................................................
4 ............................................................
Life-cycle cost savings
Payback period years
Households with
Average
installed
price
Average
operating
cost
Average
LCC
Average
savings
No
impact
Net
benefit
Median
Average
Net cost
$310
332
361
$561
240
234
$871
572
595
................
$15
¥8
................
0.1%
93.5%
................
93.5%
0.0%
................
6.4%
6.5%
..................
4.3
73
..................
3.3
258
0.106
0.399
0.420
Tables VI.8 through VI.11 show the
LCC and PBP results for ovens (other
than microwave ovens). For gas
standard ovens, the base case includes
a significant number of households that
would not be affected by a standard at
TSLs 1 through 3. DOE determined the
median and average values of the PBPs
shown below by excluding the
percentage of households not affected
by the standard. The large difference in
the average and median values for TSL
4 for all ovens is due to households with
excessively long PBPs in the
distribution of results. The LCC analysis
for TSL 4 yielded a few results with
PBPs of thousands of years, leading to
an average PBP that is very long. In
these cases, the median PBP is a more
representative value to gauge the length
of the PBP.
TABLE VI.8—ELECTRIC STANDARD OVENS: LIFE-CYCLE COST AND PAYBACK PERIOD RESULTS
Life-cycle cost
TSL
EF
Life-cycle cost savings
Payback period years
Households with
Average
installed
price
Average
operating
cost
Average
LCC
Average
savings
No
impact
Net
benefit
Median
Average
Net cost
................
................
................
................
..................
................
8.0
61
309
2,325
Baseline ...................................................
0.1066
$414
$231
$645
1 ..............................................................
0.1066
414
231
645
2, 3 ..........................................................
4 ..............................................................
0.1163
0.1209
421
489
213
206
634
695
No change from baseline
$11
¥59
42.7%
94.4%
0.0%
0.0%
57.3%
5.6%
TABLE VI.9—ELECTRIC SELF-CLEANING OVENS: LIFE-CYCLE COST AND PAYBACK PERIOD RESULTS
Life-cycle cost
mstockstill on PROD1PC66 with RULES2
TSL
EF
Life-cycle cost savings
Households with
Average
installed
price
Average
operating
cost
Average
LCC
Average
savings
Net cost
No
impact
Net
benefit
Median
Average
................
................
................
................
................
................
Baseline .....................................................
0.1099
$485
$243
$728
1, 2, 3 ........................................................
0.1099
485
243
728
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Payback period
years
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No change from baseline
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TABLE VI.9—ELECTRIC SELF-CLEANING OVENS: LIFE-CYCLE COST AND PAYBACK PERIOD RESULTS—Continued
Life-cycle cost
TSL
EF
4 ................................................................
Life-cycle cost savings
Average
installed
price
Average
operating
cost
Average
LCC
Average
savings
Net cost
548
239
787
¥$143
78.5%
0.1123
Payback period
years
Households with
No
impact
Net
benefit
0.0%
Median
21.5%
236
Average
1256
TABLE VI.10—GAS STANDARD OVENS: LIFE-CYCLE COST AND PAYBACK PERIOD RESULTS
Life-cycle cost
TSL
EF
Baseline .................................................
1, 2, 3 ....................................................
4 ............................................................
Life-cycle cost savings
Payback period years
Households with
Average
installed
price
Average
operating
cost
Average
LCC
Average
savings
No
impact
Net
benefit
Median
Average
Net cost
$430
464
507
$406
266
484
$837
730
991
................
$9
¥81
................
5.1%
93.2%
................
82.3%
0.0%
................
12.6%
6.8%
..................
9.0
25
..................
7.0
368
0.0298
0.0583
0.0600
TABLE VI.11—GAS SELF-CLEANING OVENS: LIFE-CYCLE COST AND PAYBACK PERIOD RESULTS
Life-cycle cost
TSL
EF
Life-cycle cost savings
Average
installed
price
Average
operating
cost
Average
LCC
Average
savings
Net cost
No
impact
Net
benefit
Median
Average
................
................
................
................
................
................
11
16
391
461
Baseline .....................................................
0.0540
$550
$614
$1,164
1, 2 ............................................................
0.0540
550
614
1,164
3 ................................................................
4 ................................................................
0.0625
0.0632
566
574
595
593
1,161
1,168
Table VI.12 shows the LCC and PBP
results for microwave ovens. Results are
presented for TSLs pertaining to EF.
Payback period
years
Households with
No change from baseline
$3
¥4
56.1%
65.0%
Because DOE estimated that the entire
market is at the baseline level, the
average LCC savings reported for each of
0.0%
0.0%
43.9%
35.0%
the four TSLs are equal to the average
LCC of the TSL minus the average LCC
of the baseline.
TABLE VI.12—MICROWAVE OVENS: LIFE-CYCLE COST AND PAYBACK PERIOD RESULTS FOR EF
Life-cycle cost
TSL
EF
Baseline .....................................................
1 ................................................................
2 ................................................................
3 ................................................................
4 ................................................................
Life-cycle cost savings
Average
installed
price
Average
operating
cost
Average
LCC
Average
savings
Net cost
No
impact
Net
benefit
Median
Average
$220
232
246
267
294
$124
119
119
117
116
$344
351
364
384
410
................
¥$7
¥21
¥40
¥66
................
90.6%
97.6%
99.2%
99.8%
................
0.0%
0.0%
0.0%
0.0%
................
9.4%
2.4%
0.8%
0.2%
................
30
58
83
117
................
76
147
210
296
0.557
0.586
0.588
0.597
0.602
mstockstill on PROD1PC66 with RULES2
b. Consumer Subgroup Analysis
2. Economic Impact on Manufacturers
DOE estimated consumer subgroup
impacts by determining the LCC
impacts of the TSLs on low-income and
senior-only households. DOE found that
the LCC impacts on these subgroups and
the payback periods are similar to the
LCC impacts and payback periods on
the full sample of residential
consumers. Thus, the proposed
standards would have an impact on
low-income and senior-only households
that would be similar to the impact on
the general population of residential
consumers. Chapter 12 of the TSD
accompanying this notice presents the
detailed results of that analysis.
DOE determined the economic
impacts on manufacturers of the TSLs
considered for today’s rule, as described
in the October 2008 NOPR. 73 FR
62034, 62075–81, 62091–62104, 62128–
30 (Oct. 17, 2008). The results of these
economic analyses are summarized
below. For a more complete description
of the anticipated economic impacts on
manufacturers, see chapter 13 of the
TSD accompanying this notice.
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Payback period
years
Households with
a. Industry Cash-Flow Analysis Results
Using two different markup
scenarios—a preservation of gross
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margin 37 (percentage) scenario and a
preservation of gross margin (in absolute
dollars) scenario—DOE estimated the
impact of potential new standards for
conventional cooking products and for
the cooking efficiency of microwave
ovens on the INPV of the industries that
manufacture these products. 73 FR
62034, 62077–78, 62092–99 (Oct. 17,
2008).
37 ‘‘Gross margin’’ is defined as ‘‘revenues minus
cost of goods sold.’’ On a unit basis, gross margin
is selling price minus manufacturer production
cost. In the GRIMs, markups determine the gross
margin because various markups are applied to the
manufacturer production costs to reach
manufacturer selling price.
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Under the preservation of gross
margin scenario, DOE applied a single
uniform ‘‘gross margin percentage’’
markup across all efficiency levels. As
production cost increases with
efficiency, this scenario implies that the
absolute dollar markup will increase. In
their interviews, all manufacturers
stated that it is optimistic to assume that
they would be able to maintain the same
gross margin percentage markup as their
production costs increase in response to
an energy conservation standard.
Therefore, DOE believes that this
scenario represents a high bound to
industry profitability under an energy
conservation standard. In the
‘‘preservation of gross margin (absolute
dollars)’’ scenario, gross margin is
defined as ‘‘revenues less cost of goods
sold.’’ The implicit assumption behind
this markup scenario is that the industry
will lower its markups in response to
the standards to maintain only its gross
margin (in absolute dollars).
The impact of new standards on INPV
consists of the difference between the
INPV in the base case and the INPV in
the standards case. INPV is the primary
metric used in the MIA and it represents
one measure of the fair value of an
industry in today’s dollars. For each
industry affected by today’s rule, DOE
calculated INPV by summing all of the
net cash flows, discounted at the
industry’s cost of capital or discount
rate.
For each type of product under
consideration in this rulemaking, Tables
VI.13 through VI.22 show the changes in
INPV under both markup scenarios that
DOE estimates would result from the
TSLs considered for this final rule. The
tables also present the product
conversion costs and capital conversion
costs that the industry would incur at
each TSL. Product conversion costs
include engineering, prototyping,
testing, and marketing expenses
incurred by a manufacturer as it
prepares to come into compliance with
a standard. Capital investments are the
one-time outlays for equipment and
buildings required for the industry to
comply (i.e., capital conversion costs).
TABLE VI.13—MANUFACTURER IMPACT ANALYSIS FOR ELECTRIC COOKTOPS UNDER THE PRESERVATION OF GROSS
MARGIN PERCENTAGE MARKUP SCENARIO
[Preservation of gross margin percentage markup scenario]
TSL
Units
Base case
1
INPV ....................................
Change in INPV ..................
Amended Energy Conservation Standards Product
Conversion Expenses.
Amended Energy Conservation Standards Capital Investments.
Total Investment Required ..
2
3
4
2006$ millions ....................
2006$ millions ....................
% ........................................
2006$ millions ....................
359
........................
........................
........................
359
0
0
0
357
(2)
¥0.55
9.6
357
(2)
¥0.55
9.6
437
78
21.76
21.8
2006$ millions ....................
........................
0
0
0
73.1
2006$ millions ....................
........................
0
9.6
9.6
94.9
Numbers in parentheses indicate negative values.
TABLE VI.14—MANUFACTURER IMPACT ANALYSIS FOR ELECTRIC COOKTOPS UNDER THE PRESERVATION OF GROSS
MARGIN ABSOLUTE DOLLARS MARKUP SCENARIO
[Preservation of gross margin absolute dollars markup scenario]
TSL
Units
Base case
1
INPV ....................................
Change in INPV ..................
Amended Energy Conservation Standards Product
Conversion Expenses.
Amended Energy Conservation Standards Capital Investments.
Total Investment Required ..
2
3
4
2006$ millions ....................
2006$ millions ....................
% ........................................
2006$ millions ....................
359
........................
........................
........................
359
0
0
0
348
(11)
¥3.18
9.6
348
(11)
¥3.18
9.6
(26)
(385)
¥107.19
21.8
2006$ millions ....................
........................
0
0
0
73.1
2006$ millions ....................
........................
0
9.6
9.6
94.9
Numbers in parentheses indicate negative values.
TABLE VI.15—MANUFACTURER IMPACT ANALYSIS FOR GAS COOKTOPS UNDER THE PRESERVATION OF GROSS MARGIN
PERCENTAGE MARKUP SCENARIO
mstockstill on PROD1PC66 with RULES2
[Preservation of gross margin percentage markup scenario]
TSL
Units
Base case
1
INPV ....................................
Change in INPV ..................
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2006$ millions ....................
% ........................................
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........................
........................
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283
(5)
¥1.73
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(5)
¥1.73
08APR2
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283
(5)
¥1.73
316
28
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16073
TABLE VI.15—MANUFACTURER IMPACT ANALYSIS FOR GAS COOKTOPS UNDER THE PRESERVATION OF GROSS MARGIN
PERCENTAGE MARKUP SCENARIO—Continued
[Preservation of gross margin percentage markup scenario]
TSL
Units
Base case
1
Amended Energy Conservation Standards Product
Conversion Expenses.
Amended Energy Conservation Standards Capital Investments.
Total Investment Required ..
2
3
4
2006$ millions ....................
........................
9.4
9.4
9.4
20.8
2006$ millions ....................
........................
2.2
2.2
2.2
3.3
2006$ millions ....................
........................
11.5
11.5
11.5
24.1
Numbers in parentheses indicate negative values.
TABLE VI.16—MANUFACTURER IMPACT ANALYSIS FOR GAS COOKTOPS UNDER THE PRESERVATION OF GROSS MARGIN
ABSOLUTE DOLLARS MARKUP SCENARIO
[Preservation of gross margin absolute dollars markup scenario]
TSL
Units
Base case
1
INPV ....................................
Change in INPV ..................
Amended Energy Conservation Standards Product
Conversion Expenses.
Amended Energy Conservation Standards Capital Investments.
Total Investment Required ..
2
3
4
2006$ millions ....................
2006$ millions ....................
% ........................................
2006$ millions ....................
288
........................
........................
........................
276
(12)
¥4.11
9.4
276
(12)
¥4.11
9.4
276
(12)
¥4.11
9.4
146
(99)
¥34.45
20.8
2006$ millions ....................
........................
2.2
2.2
2.2
3.3
2006$ millions ....................
........................
11.5
11.5
11.5
24.1
Numbers in parentheses indicate negative values.
TABLE VI.17—MANUFACTURER IMPACT ANALYSIS FOR ELECTRIC OVENS UNDER THE PRESERVATION OF GROSS MARGIN
PERCENTAGE MARKUP SCENARIO
[Preservation of gross margin percentage markup scenario]
TSL
Units
Base case
1
INPV ....................................
Change in INPV ..................
Amended Energy Conservation Standards Product
Conversion Expenses.
Amended Energy Conservation Standards Capital Investments.
Total Investment Required ..
2
3
4
2006$ millions ....................
2006$ millions ....................
% ........................................
2006$ millions ....................
797
........................
........................
........................
797
0
0
0
789
(8)
¥0.98
20.8
789
(8)
¥0.98
20.8
788
(9)
¥1.17
67.6
2006$ millions ....................
........................
0
0.8
0.8
179.8
2006$ millions ....................
........................
0
21.6
21.6
247.5
Numbers in parentheses indicate negative values.
TABLE VI.18—MANUFACTURER IMPACT ANALYSIS FOR ELECTRIC OVENS UNDER THE PRESERVATION OF GROSS MARGIN
ABSOLUTE DOLLARS MARKUP SCENARIO
[Preservation of gross margin absolute dollars markup scenario]
TSL
Units
Base case
mstockstill on PROD1PC66 with RULES2
1
INPV ....................................
Change in INPV ..................
Amended Energy Conservation Standards Product
Conversion Expenses.
VerDate Nov<24>2008
17:28 Apr 07, 2009
2006$ millions ....................
2006$ millions ....................
% ........................................
2006$ millions ....................
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........................
........................
........................
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2
797
0
0.00
0.0
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3
778
(19)
¥2.43
20.8
08APR2
4
778
(19)
¥2.43
20.8
326
(471)
¥59.07
67.6
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TABLE VI.18—MANUFACTURER IMPACT ANALYSIS FOR ELECTRIC OVENS UNDER THE PRESERVATION OF GROSS MARGIN
ABSOLUTE DOLLARS MARKUP SCENARIO—Continued
[Preservation of gross margin absolute dollars markup scenario]
TSL
Units
Base case
1
Amended Energy Conservation Standards Capital Investments.
Total Investment Required ..
2
3
4
2006$ millions ....................
........................
0.0
0.8
0.8
179.8
2006$ millions ....................
........................
0.0
21.6
21.6
247.5
Numbers in parentheses indicate negative values.
TABLE VI.19—MANUFACTURER IMPACT ANALYSIS FOR GAS OVENS UNDER THE PRESERVATION OF GROSS MARGIN
PERCENTAGE MARKUP SCENARIO
[Preservation of gross margin percentage markup scenario]
TSL
Units
Base case
1
INPV ....................................
Change in INPV ..................
Amended Energy Conservation Standards Product
Conversion Expenses.
Amended Energy Conservation Standards Capital Investments.
Total Investment Required ..
2
3
4
2006$ millions ....................
2006$ millions ....................
% ........................................
2006$ millions ....................
469
........................
........................
........................
461
(7)
¥1.56
9.4
461
(7)
¥1.56
9.4
462
(6)
¥1.36
18.7
422
(46)
¥9.91
100.3
2006$ millions ....................
........................
1.8
1.8
7.6
72.0
2006$ millions ....................
........................
11.1
11.1
26.4
172.3
Numbers in parentheses indicate negative values.
TABLE VI.20—MANUFACTURER IMPACT ANALYSIS FOR GAS OVENS UNDER THE PRESERVATION OF GROSS MARGIN
ABSOLUTE DOLLARS MARKUP SCENARIO
[Preservation of gross margin absolute dollars markup scenario]
TSL
Units
Base case
1
INPV ....................................
Change in INPV ..................
Amended Energy Conservation Standards Product
Conversion Expenses.
Amended Energy Conservation Standards Capital Investments.
Total Investment Required ..
2
3
4
2006$ millions ....................
2006$ millions ....................
% ........................................
2006$ millions ....................
469
........................
........................
........................
459
(10)
¥2.10
9.4
459
(10)
¥2.10
9.4
428
(41)
¥8.68
18.7
287
(182)
¥38.74
100.3
2006$ millions ....................
........................
1.8
1.8
7.6
72.0
2006$ millions ....................
........................
11.1
11.1
26.4
172.3
Numbers in parentheses indicate negative values.
TABLE VI.21—MANUFACTURER IMPACT ANALYSIS FOR MICROWAVE OVENS UNDER THE PRESERVATION OF GROSS
MARGIN PERCENTAGE MARKUP SCENARIO (ENERGY FACTOR)
[Preservation of gross margin percentage markup scenario]
TSL
Units
Base case
1a
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INPV ....................................
Change in INPV ..................
Amended Energy Conservation Standards Product
Conversion Expenses.
Amended Energy Conservation Standards Capital Investments.
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2a
3a
4a
2006$ millions ....................
2006$ millions ....................
% ........................................
2006$ millions ....................
1,456
........................
........................
........................
1,501
45
3.06
60.0
1,575
118
8.11
75.0
1,695
238
16.37
90.0
1,726
270
18.53
225.0
2006$ millions ....................
........................
0.0
0.0
0.0
75.0
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TABLE VI.21—MANUFACTURER IMPACT ANALYSIS FOR MICROWAVE OVENS UNDER THE PRESERVATION OF GROSS
MARGIN PERCENTAGE MARKUP SCENARIO (ENERGY FACTOR)—Continued
[Preservation of gross margin percentage markup scenario]
TSL
Units
Base case
1a
Total Investment Required ..
2006$ millions ....................
........................
2a
60.0
3a
75.0
4a
90.0
300.0
Numbers in parentheses indicate negative values.
TABLE VI.22—MANUFACTURER IMPACT ANALYSIS FOR MICROWAVE OVENS UNDER THE PRESERVATION OF GROSS
MARGIN ABSOLUTE DOLLARS MARKUP SCENARIO (ENERGY FACTOR)
[Preservation of gross margin percentage markup scenario]
TSL
Units
Base case
1a
INPV ....................................
Change in INPV ..................
Amended Energy Conservation Standards Product
Conversion Expenses.
Amended Energy Conservation Standards Capital Investments.
Total Investment Required ..
2a
3a
4a
2006$ millions ....................
2006$ millions ....................
% ........................................
2006$ millions ....................
1,456
........................
........................
........................
1,256
(200)
¥13.75
60.0
1,068
(388)
¥26.64
75.0
778
(679)
¥46.60
90.0
285
(1,171)
¥80.42
225.0
2006$ millions ....................
........................
0.0
0.0
0.0
75.0
2006$ millions ....................
........................
60.0
75.0
90.0
300.0
Numbers in parentheses indicate negative values.
As noted above, the October 2008
NOPR provides a detailed discussion of
the estimated impact of new standards
for cooking products on INPV. 73 FR
62034, 62091–99 (Oct. 17, 2008).
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b. Impacts on Manufacturer
Employment
As discussed in the October 2008
NOPR, DOE expects that employment
by manufacturers would increase under
all of the TSLs considered for today’s
rule, although this does not take into
account any relocation of domestic jobs
to countries with lower labor costs that
might be influenced by the level of
investment required by new standards.
73 FR 62034, 62100–03 (Oct. 17, 2008).
For today’s final rule, DOE estimates
that the increase in the number of
production employees in 2012 due to
standards (depending on the TSL) could
be 7 to 577 for conventional cooking
product manufacturers and 16 to 97 for
microwave oven manufacturers. Further
support for these conclusions regarding
direct employment impacts is provided
in chapter 13 of the TSD. Indirect
employment impacts from standards,
consisting of the jobs created in or
eliminated from the national economy
other than in the manufacturing sector
being regulated, are discussed in section
IV.G.
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c. Impacts on Manufacturers That Are
Small Businesses
As discussed in section IV.F and in
the October 2008 NOPR, DOE identified
two small manufacturers of residential,
conventional cooking products. Both
manufacture gas-fired ovens, ranges,
and cooktops with standing pilot lights,
and these products comprise 25 percent
or more of their production. 73 FR
62034, 62076, 62095, 62103 (Oct. 17,
2008). Impacts of today’s standards on
these two small businesses are
discussed in section VII.B of this notice.
As explained in the October 2008
NOPR, there are no small businesses
that manufacture microwave ovens. 73
FR 62034, 62130 (Oct. 17, 2008).
d. Cumulative Regulatory Burden
The October 2008 NOPR notes that
one aspect of DOE’s assessment of
manufacturer burden is the cumulative
impact of multiple DOE standards and
other regulatory actions that affect
manufacture of the same covered
products and other equipment produced
by the same manufacturers or their
parent companies. 73 FR 62034, 62104
(Oct. 17, 2008). In addition to DOE’s
energy conservation regulations for
cooking products, DOE identified other
regulations that manufacturers face for
cooking and other products and
equipment they manufacture within 3
years before and 3 years after the
anticipated effective date of the
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amended DOE regulations. Id. The most
significant of these additional
regulations include Federal standby
power requirements, several additional
Federal and State energy conservation
standards, the Restriction of Hazardous
Substance Directive (RoHS), State-byState restrictions on mercury (which
affect gas cooking appliances), and
international energy conservation
standards and test procedures. Id. As
noted in the October 2008 NOPR, the
last three of these requirements do not
affect the standards DOE considered for
today’s final rule. Most manufacturers
DOE interviewed stated that they
already comply with the RoHS
directive, and most gas cooking
appliance manufacturers have already
eliminated mercury switches or have
plans to do so. In addition, although
manufacturers may incur a substantial
cost if there are overlapping testing and
certification requirements in other
markets besides the United States, DOE
only accounts for domestic compliance
costs in its calculation of product
conversion expenses for products
covered in this rulemaking. Id.
EISA 2007 directs DOE to publish
final rules to modify its test procedures
to measure and account for standby
mode and off mode energy consumption
for various products (including kitchen
ranges and ovens and microwave ovens)
by statutorily prescribed dates. 42
U.S.C. 6295(gg)(2)(B). In addition, EISA
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2007 provides that any final rule
prescribing amended or new energy
conservation standards adopted after
July 1, 2010 must account for standby
mode and off mode energy use. 42 U.S.C
6295(gg)(3)(A). DOE has determined that
some manufacturers of cooking products
also produce other residential
appliances that will be subject to EISA
2007 regulations on standby and off
mode power. In interviews that DOE
conducted for the October 2008 NOPR,
manufacturers stated that these
requirements will impose a heavy
burden on their testing facilities going
forward. In addition, manufacturers
expressed a concern that EISA 2007’s
standby power requirements could
3. Net Present Value of Consumer
Impacts and National Employment
Impacts
create many overlapping regulatory
compliance costs in the future.
In the analyses conducted for the
October 2008 NOPR, DOE also
identified numerous Federal and State
energy conservation standards
regulations that could affect cooking
product manufacturers that produce
other residential and commercial
equipment. (See chapter 13 of the NOPR
TSD.) Additional investments necessary
to meet these potential standards could
have significant impacts on
manufacturers of the covered products.
Chapter 13 of the TSD accompanying
this notice addresses in greater detail
the issue of cumulative regulatory
burden.
The NPV analysis estimates the
cumulative NPV to the Nation of total
consumer costs and savings that would
result from particular standard levels.
Tables VI.23 and VI.24 provide an
overview of the NPV results for each
TSL considered for conventional
cooking products and microwave ovens,
respectively, using both a 7-percent and
a 3-percent real discount rate. See
chapter 11 of the TSD accompanying
this notice for more detailed NPV
results.
TABLE VI.23—CUMULATIVE NET PRESENT VALUE FOR CONVENTIONAL COOKING PRODUCTS
[Impacts for units sold from 2012 to 2042]
NPV
billion 2006$
Electric coil
cooktops
..............................................
..............................................
..............................................
..............................................
Gas cooktops
Electric standard
ovens
Electric selfclean ovens
Gas standard
ovens
Gas self-clean
ovens
Total
Discount rate
Discount rate
Discount rate
Discount rate
Discount rate
Discount rate
Discount rate
7%
1
2
3
4
Electric smooth
cooktops
Discount rate
TSL
7%
3%
7%
3%
7%
3%
7%
3%
7%
3%
7%
7%
3%
0.00
0.00
0.00
¥7.30
0.00
0.00
0.00
¥13.95
0.22
0.22
0.22
¥0.69
0.56
0.56
0.56
¥1.01
0.00
0.13
0.13
¥0.78
0.00
0.43
0.43
¥1.26
0.00
0.00
0.00
¥2.77
0.00
0.00
0.00
¥5.18
0.03
0.03
0.03
¥0.89
0.14
0.14
0.14
¥1.72
0.00
0.00
0.01
¥0.11
0.25
0.48
0.49
¥12.46
0.71
1.43
1.68
¥22.79
0.00
0.09
0.09
0.09
3%
0.00
0.30
0.30
0.30
DOE also estimated the national
TABLE VI.24—CUMULATIVE NET
PRESENT VALUE FOR MICROWAVE employment impacts that would result
from each TSL. As Table VI.25 shows,
OVEN ENERGY FACTOR
[Impacts for units sold from 2012 to 2042]
NPV
billion 2006$
TSL
7% Discount
rate
1
2
3
4
............
............
............
............
¥1.23
¥3.33
¥6.32
¥10.05
3% Discount
rate
¥2.06
¥6.05
¥11.68
¥18.70
DOE estimates that any net monetary
savings from standards would be
redirected to other forms of economic
activity. DOE also expects these shifts in
spending and economic activity would
affect the demand for labor. DOE
estimated that net indirect employment
impacts from energy conservation
standards for cooking products would
be positive (see Table VI.25), but very
small relative to total national
3%
0.00
0.00
0.25
0.03
employment. This increase would likely
be sufficient to fully offset any adverse
impacts on employment that might
occur in the cooking products
industries. For details on the
employment impact analysis methods
and results, see chapter 15 of the TSD
accompanying this notice.
TABLE VI.25—NET NATIONAL CHANGE IN INDIRECT EMPLOYMENT, THOUSANDS OF JOBS IN 2042
Thousands of jobs in 2042
Conventional cooking
products
Trial standard level
1
2
3
4
Trial standard level
Microwave oven EF
0.26
0.94
1.03
1.21
1
2
3
4
2.06
2.07
2.44
2.47
...................................................................................................
...................................................................................................
...................................................................................................
...................................................................................................
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4. Impact on Utility or Performance of
Products
5. Impact of Any Lessening of
Competition
As indicated in sections III.E.1.d and
V.B.4 of the October 2008 NOPR, DOE
has concluded that the TSLs it has
considered for cooking products would
not lessen the utility or performance of
any cooking products. 73 FR 62034,
62046–47, 62107 (Oct. 17, 2008).
As discussed in the October 2008
NOPR (73 FR 62034, 62047, 62107 (Oct.
17, 2008)) and in section III.D.1.e of this
preamble, DOE considers any lessening
of competition likely to result from
proposed energy conservation
standards. The Attorney General also
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provides DOE with a written
determination of the impact, if any, of
any such lessening of competition. DOE
considers the Attorney General’s
determination when preparing the final
rule for the standards rulemaking and
publishes this written determination as
an attachment to the final rule.
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The DOJ concluded that the cooking
products standards contained in the
proposed rule could substantially limit
consumer choice by eliminating the
cooking appliance that most closely
meets the needs of certain consumers,
including those with religious and
cultural practices that prohibit the use
of line electricity, those without access
to line electricity, and those whose
kitchens do not have appropriate
electrical outlets. The DOJ
recommended that to maintain
competition, DOE should consider
setting a ‘‘no standard’’ standard for
residential gas cooking products with
constant burning pilots to address the
potential for certain customers to be
stranded without an economical
product alternative. (DOJ, No. 53 at p. 2)
As discussed in section VI.D.2 above,
DOE conducted additional research on
battery-powered ignition systems for
residential gas cooking products. DOE
was able to identify a gas range for sale
in the United Kingdom (U.K.) that
incorporates a battery-powered ignition
system that appears to meet the
functional safety requirements of ANSI
Z21.1 (i.e., that the oven main burner is
lit by an intermittent gas pilot that is in
turn lit by a battery-powered spark
igniter). This ignition system meets the
requirements of ANSI Z21.1 in that it
does not require the user to push a
separate ‘‘light’’ button at the same time
as the control knob is turned to allow
pilot gas flow. However, this ignition
system does not include a safety device
to shut off the main gas valve in the
event that no flame is detected, which
is required by the ANSI standard.
However, DOE found that there are
gas cooking products with batterypowered ignition for RV applications
available in the United States that meet
similar ANSI safety standards for RV gas
cooking products and as found in ANSI
safety standards for residential gas
cooking products. Thus, DOE believes,
that a battery-powered ignition system
designed for an RV gas range could be
integrated into a residential gas range
that could meet ANSI Z21.1
requirements.
DOE next investigated the possibility
that battery-powered ignition systems
used in other indoor residential
appliances in the United States could
meet the requirements of ANSI Z21.1,
even though they are not currently being
incorporated in gas cooking products.
DOE identified several such appliances,
including a remote-controlled gas
fireplace and instantaneous gas water
heaters. For these products, the batterypowered ignition systems are required
to meet the same or equivalent
component-level ANSI safety standards
as are required for automatic ignition
systems in gas cooking products. DOE
contacted several manufacturers of gas
cooking products, fireplaces, and
instantaneous water heaters, as well as
ignition component suppliers, to
investigate the technological feasibility
of integrating these existing batterypowered ignition systems into gas
cooking products that would meet ANSI
Z21.1. None of these manufacturers
could identify insurmountable
technological impediments to the
development of such a product. Based
on its research, DOE determined that the
primary barrier to commercialization of
battery-powered ignition systems in gas
cooking products has been lack of
market demand and economic
justification rather than technological
feasibility. Therefore, DOE concludes
that a gas range incorporating one of
these ignition systems could meet ANSI
Z21.1. In addition, DOE research
suggests that the market niche for gas
cooking products equipped with
battery-powered ignition systems,
16077
which would be created by the
proposed gas cooking product
standards, would likely attract entrants
among ignition component suppliers.
Therefore, in consideration of the above,
DOE concludes that technologically
feasible alternative ignition systems to
standing pilots in gas cooking products
exist and that consumer choice will not
be limited by eliminating pilot lights of
gas ranges and ovens without electrical
supply cords.
6. Need of the Nation to Conserve
Energy
Improving the energy efficiency of
cooking products, where economically
justified, would likely improve the
security of the Nation’s energy system
by reducing overall demand for energy,
thus reducing the Nation’s reliance on
foreign sources of energy. Reduced
demand would also likely improve the
reliability of the electricity system,
particularly during peak-load periods.
Energy savings from higher standards
for cooking products would also
produce environmental benefits in the
form of reduced emissions of air
pollutants and greenhouse gases
associated with energy production, and
with household and building use of
fossil fuels at sites where gas cooking
products are used. Table VI.26 provides
DOE’s estimate of cumulative CO2, NOX,
and Hg emissions reductions that would
result from the TSLs considered in this
rulemaking. The expected energy
savings from new standards for cooking
products may also reduce the cost of
maintaining nationwide emissions
standards and constraints. In the
environmental assessment (chapter 16
of the TSD accompanying this notice),
DOE reports estimated annual changes
in CO2, NOX, and Hg emissions
attributable to each TSL.
TABLE VI.26—CUMULATIVE CO2, AND OTHER EMISSIONS REDUCTIONS (CUMULATIVE REDUCTIONS FOR PRODUCTS SOLD
FROM 2012 TO 2042)
Emissions Reductions for Conventional Cooking Products
TSL 1
TSL 3
TSL 4
13.74
6.71
0¥0.15
15.46
6.88
0¥0.19
23.39
10.82
0¥0.28
34.96
16.07
0¥0.41
TSL 1
CO2 (Mt) ...........................................................................................................................................
NOX (kt) ...........................................................................................................................................
Hg (t) ................................................................................................................................................
TSL 2
TSL 2
TSL 3
TSL 4
22.88
2.55
0¥0.46
33.46
3.75
0¥0.68
53.89
6.06
0¥1.10
74.67
8.42
0¥1.52
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Emissions Reductions for Microwave Ovens Energy Factor
CO2 (Mt) ...........................................................................................................................................
NOX (kt) ...........................................................................................................................................
Hg (t) ................................................................................................................................................
Mt = million metric tons.
kt = thousand metric tons.
t = metric tons.
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As discussed in section IV.I of this
final rule, DOE does not report SO2
emissions reductions from power plants
because reductions from an energy
conservation standard would not affect
the overall level of SO2 emissions in the
United States due to the emissions caps
for SO2.
For the October 2008 NOPR, DOE’s
NEMS–BT modeling assumed that NOX
would be subject to the CAIR, issued by
the U.S. Environmental Protection
Agency on March 10, 2005. 70 FR 25162
(May 12, 2005). On July 11, 2008, the
U.S. Court of Appeals for the District of
Columbia Circuit (D.C. Circuit) issued
its decision in North Carolina v.
Environmental Protection Agency, in
which the court vacated CAIR. 531 F.3d
896 (DC Cir. 2008). Because the NEMS–
BT model could no longer be used to
estimate NOX emissions, DOE estimated
a range of NOX reductions that would
result from the trial standard levels
being considered for the October 2008
NOPR based on low and high NOX
emission rates. DOE multiplied these
emission rates by the reduction in
electricity generation due to the
potential amended energy conservation
standards considered to calculate the
expected reduction in NOX emissions.
The October 2008 NOPR describes these
calculations in greater detail. 73 FR
62034, 62108–09 (Oct. 17, 2008).
On December 23, 2008, after the
publication of the October 2008 NOPR,
the D.C. Circuit decided to allow CAIR
to remain in effect until it is replaced by
a rule consistent with the court’s earlier
opinion. North Carolina v. EPA, 550
F.3d 1176 (D.C. Cir. 2008) (remand of
vacatur). As a result, for today’s final
rule, DOE was able to use the NEMS–
BT model to estimate the NOX
emissions reductions that standards
would cause. CAIR permanently caps
emissions of NOX for 28 eastern States
and D.C. This means that any new or
amended energy conservation standards
for cooking products would be unlikely
to result in any reduction of NOX
emissions in those States covered by the
CAIR caps. Under caps, physical
emissions reductions in those States
would not result from the energy
conservation standards under
consideration by DOE, but standards
might have produced an
environmentally related economic
impact in the form of lower prices for
emissions allowance credits, if large
enough. However, DOE determined that
in the present case, such standards
would not produce an environmentallyrelated economic impact in the form of
lower prices for emissions allowance
credits, because the estimated reduction
in NOX emissions or the corresponding
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allowance credits in States covered by
the CAIR cap would be too small to
affect allowance prices for NOX under
the CAIR. In contrast, new or amended
energy conservation standards would
reduce NOX emissions in those 22 States
that are not affected by CAIR. As a
result, the NEMS–BT does forecast NOX
emission reductions from energy
sources in those 22 States from the
cooking product standards considered
in today’s final rule.
As noted in section IV.I, DOE was
able to estimate the changes in Hg
emissions associated with an energy
conservation standard as follows. DOE
notes that the NEMS–BT model, used as
an integral part of today’s rulemaking,
does not estimate Hg emission
reductions due to new energy
conservation standards, as it assumed
that Hg emissions would be subject to
EPA’s CAMR.38 CAMR would have
permanently capped emissions of
mercury for new and existing coal-fired
plants in all States by 2010. As with SO2
and NOX, DOE assumed that under such
a system, energy conservation standards
would have resulted in no physical
effect on these emissions, but might
have resulted in an environmentally
related economic benefit in the form of
a lower price for emissions allowance
credits if those credits were large
enough. DOE estimated that the change
in the Hg emissions from energy
conservation standards would not be
large enough to influence allowance
prices under CAMR.
On February 8, 2008, the D.C. Circuit
issued its decision in New Jersey v.
Environmental Protection Agency 39 to
vacate CAMR. In light of this
development and because the NEMS–
BT model could not be used to directly
calculate Hg emission reductions, DOE
used the Hg emission rates discussed
above to calculate emissions reductions.
Therefore, rather than using the
NEMS–BT model, DOE established a
range of Hg rates to estimate the Hg
emissions that could be reduced
through standards. DOE’s low estimate
assumed that future standards would
displace electrical generation only from
natural gas-fired power plants, thereby
resulting in an effective emission rate of
zero. (Under this scenario, coal-fired
power plant generation would remain
unaffected.) The low-end emission rate
is zero because natural gas-fired power
plants have virtually zero Hg emissions
associated with their operation.
DOE’s high estimate, which assumed
that standards would displace only coalfired power plants, was based on a
38 70
FR 28606 (May 18, 2005).
F.3d 574 (D.C. Cir. 2008).
39 517
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nationwide mercury emission rate from
AEO2008. (Under this scenario, gasfired power plant generation would
remain unaffected.) Because power
plant emission rates are a function of
local regulation, scrubbers, and the
mercury content of coal, it is extremely
difficult to identify a precise high-end
emission rate. Therefore, the most
reasonable estimate is based on the
assumption that all displaced coal
generation would have been emitting at
the average emission rate for coal
generation as specified by AEO2008. As
noted previously, because virtually all
mercury emitted from electricity
generation is from coal-fired power
plants, DOE based the emission rate on
the tons of mercury emitted per TWh of
coal-generated electricity. Based on the
emission rate for 2006, DOE derived a
high-end emission rate of 0.0255 tons
per TWh. To estimate the reduction in
mercury emissions, DOE multiplied the
emission rate by the reduction in coalgenerated electricity due to the
standards considered in the utility
impact analysis. These changes in Hg
emissions are extremely small, ranging
from 0.03 to 0.27 percent of the national
base-case emissions forecast by NEMS–
BT, depending on the TSL.
In the October 2008 NOPR, DOE
considered accounting for a monetary
benefit of CO2 emission reductions
associated with standards. To put the
potential monetary benefits from
reduced CO2 emissions into a form that
would likely be most useful to
decisionmakers and interested parties,
DOE used the same methods it used to
calculate the net present value of
consumer cost savings. DOE converted
the estimated yearly reductions in CO2
emissions into monetary values, which
were then discounted over the life of the
affected equipment to the present using
both 3-percent and 7-percent discount
rates.
In the October 2008 NOPR, DOE
proposed to use the range $0 to $20 per
ton for the year 2007 in 2007$. 73 FR
62034, 62110 (Oct. 17, 2008). These
estimates were based on a previous
analysis that used a range of no benefit
to an average benefit value reported by
the Intergovernmental Panel on Climate
Change (IPCC).40 DOE derived the IPCC
40 During the preparation of its most recent
review of the state of climate science, the IPCC
identified various estimates of the present value of
reducing CO2 emissions by 1 ton over the life that
these emissions would remain in the atmosphere.
The estimates reviewed by the IPCC spanned a
range of values. Absent a consensus on any single
estimate of the monetary value of CO2 emissions,
DOE used the estimates identified by the study
cited in ‘‘Summary for Policymakers,’’ prepared by
Working Group II of the IPCC’s ‘‘Fourth Assessment
Report,’’ to estimate the potential monetary value of
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estimate used as the upper bound value
from an estimate of the mean value of
worldwide impacts due to climate
change and not just the effects likely to
occur within the United States. This
previous analysis assumed that the
appropriate value should be restricted to
a representation of those costs and
benefits likely to be experienced in the
United States. DOE explained in the
October 2008 NOPR that it expects such
domestic values would be lower than
comparable global values; however,
there currently are no consensus
estimates for the U.S. benefits likely to
result from CO2 emission reductions.
Because U.S.-specific estimates were
unavailable and DOE did not receive
any additional information that would
help narrow the proposed range of
domestic benefits, DOE used the global
mean value as an upper bound U.S.
value.
The Joint Comment asserted that DOE
should use the EIA analysis of the
Climate Security Act from April 2008,
including future price escalation, to
estimate the cost of avoiding CO2
emissions. The core scenario of this
analysis specifies a $17 price per ton of
CO2 with an annual 7.4 percent yearly
increase forecast. (Joint Comment, No.
44 at p. 12) Whirlpool stated that the
regulation of CO2 should be restricted to
the regulation of power plants and,
therefore, does not support an attempt
to value those emissions as part of this
rulemaking. (Whirlpool, No. 50 at p. 8)
The Department of Energy, together
with other Federal agencies, is currently
reviewing various methodologies for
estimating the monetary value of
reductions in CO2 and other greenhouse
gas emissions. This review will consider
the comments on this subject that are
part of the public record for this and
other rulemakings, as well as other
methodological assumptions and issues,
such as whether the appropriate values
should represent domestic U.S. or global
benefits (and costs). Given the
complexity of the many issues involved,
this review is ongoing. However,
CO2 reductions likely to result from standards
considered in this rulemaking. According to IPCC,
the mean social cost of carbon (SCC) reported in
studies published in peer-reviewed journals was
$43 per ton of carbon. This translates into about $12
per ton of CO2. The literature review (Tol 2005)
from which this mean was derived did not report
the year in which these dollars were denominated.
However, DOE understands this estimate was for
the year 1995 denominated in 1995$. Updating that
estimate to 2007$ yields a SCC for the year 1995
of $15 per ton of CO2.
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17:28 Apr 07, 2009
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consistent with DOE’s legal obligations,
and taking into account the uncertainty
involved with this particular issue, DOE
has included in this rulemaking the
values and analyses previously
conducted.
Given the uncertainty surrounding
estimates of the social cost of carbon,
DOE previously concluded that relying
on any single estimate may be
inadvisable because that estimate will
depend on many assumptions. Working
Group II’s contribution to the ‘‘Fourth
Assessment Report’’ of the IPCC notes
the following:
The large ranges of SCC are due in the large
part to differences in assumptions regarding
climate sensitivity, response lags, the
treatment of risk and equity, economic and
non-economic impacts, the inclusion of
potentially catastrophic losses, and discount
rates.41
Because of this uncertainty, DOE
previously used the SCC value from Tol
(2005), which was presented in the
IPCC’s ‘‘Fourth Assessment Report’’ and
provided a comprehensive metaanalysis of estimates for the value of
SCC. Tol released an update of his 2005
meta-analysis in September 2007 that
reported an increase in the mean
estimate of SCC from $43 to $71 per ton
carbon. Although the Tol study was
updated in 2007, the IPCC has not
adopted the update. As a result, DOE
previously decided to continue to rely
on the study cited by the IPCC. DOE
notes that the conclusions of Tol in
2007 are similar to the conclusions of
Tol in 2005. In 2007, Tol continues to
indicate that there is no consensus
regarding the monetary value of
reducing CO2 emissions by 1 ton. The
broad range of values in both Tol
studies are the result of significant
differences in the methodologies used in
the studies Tol summarized. According
to Tol, all of the studies have
shortcomings, largely because the
subject is inherently complex and
uncertain and requires broad
multidisciplinary knowledge. Thus, it
was not certain that the values reported
in Tol in 2007 are more accurate or
representative than the values reported
in Tol in 2005.
For today’s final rule, DOE continues
to use the range of values proposed in
41 ‘‘Climate Change 2007—Impacts, Adaptation
and Vulnerability.’’ Contribution of Working Group
II to the ‘‘Fourth Assessment Report’’ of the IPCC,
17. Available at https://www.ipcc.ch/ipccreports/ar4wg2.htm (last accessed Aug. 7, 2008).
PO 00000
Frm 00041
Fmt 4701
Sfmt 4700
16079
the October 2008 NOPR, which was
based on the values presented in Tol
(2005) as proposed. Additionally, DOE
applied an annual growth rate of 2.4
percent to the value of SCC, as
suggested by the IPCC Working Group II
(2007, p. 822). This growth rate is based
on estimated increases in damage from
future emissions that published studies
have reported. Because the values in Tol
(2005) were presented in 1995 dollars,
DOE calculated more current values,
assigning a range for SCC of $0 to $20
(2007$) per ton of CO2 emissions.
The upper bound of the range DOE
used is based on Tol (2005), which
reviewed 103 estimates of SCC from 28
published studies. Tol concluded that
when only peer-reviewed studies
published in recognized journals are
considered, ‘‘climate change impacts
may be very uncertain but [it] is
unlikely that the marginal damage costs
of carbon dioxide emissions exceed $50
per ton carbon [comparable to a 2007
value of $20 per ton carbon dioxide
when expressed in 2007 U.S. dollars
with a 2.4 percent growth rate].’’
In setting a lower bound, DOE
previous analysis agreed with the IPCC
Working Group II (2007) report that
‘‘significant warming across the globe
and the locations of significant observed
changes in many systems consistent
with warming is very unlikely to be due
solely to natural variability of
temperatures or natural variability of the
systems’’ (p. 9), and thus tentatively
concluded that a global value of zero for
the SCC cannot be justified. However,
DOE previously concluded that it is
reasonable to allow for the possibility
that the SCC for the United States may
be quite low. In fact, some of the studies
examined by Tol (2005) reported
negative values for the SCC. As stated in
the October 2008 NOPR, DOE assumed
that it was most appropriate to use U.S.
benefit values rather than world benefit
values in its analysis, and U.S. values
will likely be lower than the global
values. As indicated above, DOE,
together with other Federal agencies, is
now reviewing whether this previous
analysis should be modified. However,
it is very unlikely that possible changes
in this methodology would affect the
conclusions reached in this rulemaking.
Table VI.27 presents the resulting
estimates of the potential range of net
present value benefits associated with
reducing CO2 emissions.
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TABLE VI.27—ESTIMATES OF VALUE OF CO2 EMISSIONS REDUCTIONS UNDER TRIAL STANDARD LEVELS AT SEVENPERCENT AND THREE-PERCENT DISCOUNT RATES
Estimated
cumulative CO2
emission reductions
Mt
Conventional cooking product TSL
1
2
3
4
...................................................................................................
...................................................................................................
...................................................................................................
...................................................................................................
13.74
15.46
23.39
34.96
...................................................................................................
...................................................................................................
...................................................................................................
...................................................................................................
DOE also investigated the potential
monetary benefit of reduced SO2, NOX,
and Hg emissions from the TSLs it
considered. As previously stated, DOE’s
initial analysis assumed the presence of
nationwide emission caps on SO2 and
Hg, and caps on NOX emissions in the
28 States covered by CAIR. In the
presence of these caps, DOE concluded
that no physical reductions in power
sector emissions would occur, but that
the standards could put downward
pressure on the prices of emissions
allowances in cap-and-trade markets.
Estimating this effect is very difficult
because of factors such as credit
banking, which can change the
trajectory of prices. DOE has concluded
that the effect from energy conservation
standards on SO2 allowance prices is
likely to be negligible based on runs of
the NEMS–BT model. See chapter 16 of
the TSD accompanying this notice for
further details.
Because the courts have decided to
allow the CAIR rule to remain in effect,
projected annual NOX allowances from
NEMS–BT are relevant. As noted above,
standards would not produce an
economic impact in the form of lower
$0
$0
$0
$0
Estimated
cumulative CO2
emission reductions
Mt
Microwave oven energy factor TSL
1
2
3
4
Value at 7%
discount rate
million 2007$
to
to
to
to
$109
$122
$182
$269
Value at 7%
discount rate
million 2007$
22.88
33.46
53.89
74.67
$0
$0
$0
$0
prices for emissions allowance credits
in the 28 eastern States and DC covered
by the CAIR cap. New or amended
energy conservation standards would
reduce NOX emissions in those 22 States
that are not affected by CAIR. For the
area of the United States not covered by
CAIR, DOE estimated the monetized
value of NOX emissions reductions
resulting from each of the TSLs
considered for today’s final rule based
on environmental damage estimates
from the literature. Available estimates
suggest a very wide range of monetary
values for NOX emissions, ranging from
$370 per ton to $3,800 per ton of NOX
from stationary sources, measured in
2001$ (equivalent to a range of $421 per
ton to $4,326 per ton in 2006$).42
For Hg emissions reductions, DOE
estimated the national monetized values
resulting from the TSLs considered for
today’s rule based on environmental
damage estimates from the literature.
DOE conducted research for today’s
final rule and determined that the
impact of mercury emissions from
power plants on humans is considered
highly uncertain. However, DOE
identified two estimates of the
to
to
to
to
$192
$277
$443
$612
Value at 3%
discount rate
million 2007$
$0
$0
$0
$0
to
to
to
to
$241.
$270.
$408.
$610.
Value at 3%
discount rate
million 2007$
$0 to $404.
$0 to $589.
$0 to $948.
$0 to $1313.
environmental damage of mercury based
on two estimates of the adverse impact
of childhood exposure to methyl
mercury on IQ for American children,
and subsequent loss of lifetime
economic productivity resulting from
these IQ losses. The high-end estimate
is based on an estimate of the current
aggregate cost of the loss of IQ in
American children that results from
exposure to mercury of U.S. power plant
origin ($1.3 billion per year in year
2000$), which works out to $31.7
million per ton emitted per year
(2006$).43 The low-end estimate is $0.66
million per ton emitted (in 2004$) or
$0.71 million per ton in 2006$. DOE
derived this estimate from a published
evaluation of mercury control using
different methods and assumptions from
the first study, but also based on the
present value of the lifetime earnings of
children exposed.44 Table VI.28 and
Table VI.29 present the resulting
estimates of the potential range of
present value benefits associated with
reduced national NOX and Hg emissions
from the TSLs DOE considered.
TABLE VI.28—ESTIMATES OF MONETARY VALUE OF REDUCTIONS OF HG AND NOX BY TRIAL STANDARD LEVEL AT A
SEVEN-PERCENT DISCOUNT RATE
Cumulative NOX
emission reductions
kt
Value of NOX
emission reductions
million 2006$
Estimated cumulative
Hg emission reductions
t
Value of estimated Hg
emission reductions
million 2006$
1 .......................................................
2 .......................................................
3 .......................................................
mstockstill on PROD1PC66 with RULES2
Conventional cooking product TSL
6.71
6.88
10.82
0.7 to 7.3
0.7 to 7.5
1.1 to 11.5
0 to 0.15
0 to 0.19
0 to 0.28
0 to 1.3.
0 to 1.6.
0 to 2.2.
42 Office of Management and Budget Office of
Information and Regulatory Affairs, ‘‘2006 Report to
Congress on the Costs and Benefits of Federal
Regulations and Unfunded Mandates on State,
Local, and Tribal Entities,’’ Washington, DC (2006).
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43 Trasande, L., et al., ‘‘Applying Cost Analyses to
Drive Policy that Protects Children,’’ 1076 Ann.
N.Y. Acad. Sci. 911 (2006).
44 Ted Gayer and Robert Hahn, ‘‘Designing
Environmental Policy: Lessons from the Regulation
of Mercury Emissions,’’ Regulatory Analysis 05–01,
PO 00000
Frm 00042
Fmt 4701
Sfmt 4700
AEI-Brookings Joint Center for Regulatory Studies,
Washington, DC (2004). A version of this paper was
published in the Journal of Regulatory Economics
in 2006. The estimate was derived by backcalculating the annual benefits per ton from the net
present value of benefits reported in the study.
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TABLE VI.28—ESTIMATES OF MONETARY VALUE OF REDUCTIONS OF HG AND NOX BY TRIAL STANDARD LEVEL AT A
SEVEN-PERCENT DISCOUNT RATE—Continued
Conventional cooking product TSL
Cumulative NOX
emission reductions
kt
Value of NOX
emission reductions
million 2006$
Estimated cumulative
Hg emission reductions
t
Value of estimated Hg
emission reductions
million 2006$
4 .......................................................
16.07
1.6 to 16.8
0 to 0.41
0 to 3.3.
Microwave oven energy factor TSL
Cumulative NOX
emission reductions
kt
Value of NOX
emission reductions
million 2006$
Estimated cumulative
Hg emission reductions
t
Value of estimated
Hg emission reductions
million 2006$
2.55
3.75
6.06
8.42
0.3 to 3.2
0.4 to 4.6
0.7 to 7.3
1.0 to 10.2
1
2
3
4
.......................................................
.......................................................
.......................................................
.......................................................
0
0
0
0
to
to
to
to
0.46
0.68
1.10
1.52
0 to 3.7
0 to 5.4
0 to 8.6
0 to 11.8
TABLE VI.29—ESTIMATES OF MONETARY VALUE OF REDUCTIONS OF HG AND NOX BY TRIAL STANDARD LEVEL AT A
THREE-PERCENT DISCOUNT RATE
Conventional cooking product TSL
1
2
3
4
.......................................................
.......................................................
.......................................................
.......................................................
Microwave oven energy factor TSL
1
2
3
4
Cumulative NOX
emission reductions
kt
6.71
6.88
10.82
16.07
mstockstill on PROD1PC66 with RULES2
to
to
to
to
Estimated cumulative
Hg emission reductions
t
15.4
15.7
24.5
36.1
0
0
0
0
Value of NOX
emission reductions
million 2006$
2.55
3.75
6.06
8.42
0.6 to 6.1
0.9 to 8.9
1.4 to 14.4
1.9 to 19.9
D. Conclusion
1. Overview
EPCA contains criteria for prescribing
new or amended energy conservation
standards. It provides that any such
standard for a covered product must be
designed to achieve the maximum
improvement in energy efficiency that
the Secretary determines is
technologically feasible and
economically justified. (42 U.S.C.
6295(o)(2)(A)) In determining whether a
standard is economically justified, the
Secretary must determine whether the
benefits of the standard exceed its
burdens, to the greatest extent
practicable, considering the seven
factors previously discussed in section
II.A of today’s final rule. (42 U.S.C.
6295(o)(2)(B)(i)) A determination of
whether a standard level is
economically justified is not made
based on any one of these factors in
isolation. The Secretary must weigh
each of these seven factors in total in
determining whether a standard is
economically justified. Further, the
Secretary may not establish a new or
amended standard if such standard
would not result in ‘‘significant
17:28 Apr 07, 2009
1.5
1.5
2.4
3.5
Cumulative NOX emission reductions
kt
.......................................................
.......................................................
.......................................................
.......................................................
VerDate Nov<24>2008
Value of NOX
emission reductions
million 2006$
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Frm 00043
Fmt 4701
Sfmt 4700
0.15
0.19
0.28
0.41
Estimated cumulative Hg
emission reductions
t
0
0
0
0
conservation of energy,’’ or ‘‘is not
technologically feasible or economically
justified.’’ (42 U.S.C. 6295(o)(3)(B))
In deciding whether to adopt
amended or new energy conservation
standards for conventional cooking
products, and for the cooking efficiency
of microwave ovens, respectively, DOE
started by examining the maximum
technologically feasible levels to
determine whether those levels were
economically justified. Upon finding
that the maximum technologically
feasible levels were not economically
justified, DOE analyzed the next lower
TSL to determine whether that level was
economically justified. DOE follows this
procedure until it identifies a TSL that
is economically justified, or determines
that no TSL is economically justified.
Below are tables that summarize the
results of DOE’s quantitative analysis for
each of the TSLs it considered for
today’s final rule. These tables present
the results for each TSL, and will aid
the reader in the discussion of costs and
benefits of each TSL. The range of
values for industry impacts represents
the results for the different markup
scenarios that DOE used to estimate
manufacturer impacts.
PO 00000
to
to
to
to
to
to
to
to
0.46
0.68
1.10
1.52
Value of estimated
Hg emission reductions
million 2006$
0
0
0
0
to
to
to
to
2.6.
3.3.
4.6.
6.9.
Value of estimated
Hg emission reductions
million 2006$
0 to 7.8.
0 to 11.3.
0 to 18.2.
0 to 25.2.
In addition to the quantitative results,
DOE also considered other burdens and
benefits that affect economic
justification. In the case of conventional
cooking products, DOE considered the
burden on the industry associated with
complying with performance standards.
Currently, conventional cooking
products are not rated for efficiency
because DOE has promulgated only
prescriptive standards for gas cooking
products. Therefore, any proposed
performance standards would require
the industry to test, rate, and label these
cooking products, a significant burden
that the industry currently does not
bear. In the specific case of gas cooking
products, DOE also considered the
safety and commercial availability of
battery-powered ignition devices as a
replacement for standing pilot ignition
systems.
2. Conventional Cooking Products
Table VI.30 summarizes the results of
DOE’s quantitative analysis for the TSLs
it considered for conventional cooking
products for today’s final rule. The
impacts at each TSL are measured
relative to a no-standards base case.
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TABLE VI.30—SUMMARY OF QUANTITATIVE RESULTS FOR CONVENTIONAL COOKING PRODUCTS *
mstockstill on PROD1PC66 with RULES2
Category
TSL 1
Primary Energy Saved (quads):
0% Discount Rate .....................................................................................................
7% Discount Rate .....................................................................................................
3% Discount Rate .....................................................................................................
Generation Capacity Reduction (GW) ** .........................................................................
NPV of Consumer Impacts (2006$ billion):
7% Discount Rate .....................................................................................................
3% Discount Rate .....................................................................................................
Industry Impacts:
Gas Cooktops
Industry NPV (2006$ million) ............................................................................
Industry NPV (% Change) .................................................................................
Electric Cooktops
Industry NPV (2006$ million) ............................................................................
Industry NPV (% Change) .................................................................................
Gas Ovens
Industry NPV (2006$ million) ............................................................................
Industry NPV (% Change) .................................................................................
Electric Ovens
Industry NPV (2006$ million) ............................................................................
Industry NPV (% Change) .................................................................................
Cumulative Emissions Reductions: †
CO2 (Mt) ...................................................................................................................
NOX (kt) ....................................................................................................................
Hg (t) .........................................................................................................................
Value of Emissions Reductions:
CO2 (2007$ million)
7% Discount Rate .............................................................................................
3% Discount Rate .............................................................................................
NOX (2006$ million)
7% Discount Rate .............................................................................................
3% Discount Rate .............................................................................................
Hg (2006$ million)
7% Discount Rate .............................................................................................
3% Discount Rate .............................................................................................
Mean LCC Savings * (2006$):
Gas Cooktop/Conventional Burners .........................................................................
Electric Cooktop/Low or High Wattage Open (Coil) Elements ................................
Electric Cooktop/Smooth Elements ..........................................................................
Gas Oven/Standard Oven with or w/o a Catalytic Line ...........................................
Gas Oven/Self-Clean Oven ......................................................................................
Electric Oven/Standard Oven with or w/o a Catalytic Line ......................................
Electric Oven/Self-Clean Oven .................................................................................
Median PBP (years):
Gas Cooktop/Conventional Burners .........................................................................
Electric Cooktop/Low or High Wattage Open (Coil) Elements ................................
Electric Cooktop/Smooth Elements ..........................................................................
Gas Oven/Standard Oven with or w/o a Catalytic Line ...........................................
Gas Oven/Self-Clean Oven ......................................................................................
Electric Oven/Standard Oven with or w/o a Catalytic Line ......................................
Electric Oven/Self-Clean Oven .................................................................................
LCC Consumer Impacts:
Gas Cooktop/Conventional Burners
Net Cost (%) ......................................................................................................
No Impact (%) ...................................................................................................
Net Benefit (%) ..................................................................................................
Electric Cooktop/Low or High Wattage Open (Coil) Elements
Net Cost (%) ......................................................................................................
No Impact (%) ...................................................................................................
Net Benefit (%) ..................................................................................................
Electric Cooktop/Smooth Elements
Net Cost (%) ......................................................................................................
No Impact (%) ...................................................................................................
Net Benefit (%) ..................................................................................................
Gas Oven/Standard Oven with or w/o a Catalytic Line
Net Cost (%) ......................................................................................................
No Impact (%) ...................................................................................................
Net Benefit (%) ..................................................................................................
Gas Oven/Self-Clean Oven
Net Cost (%) ......................................................................................................
No Impact (%) ...................................................................................................
Net Benefit (%) ..................................................................................................
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Sfmt 4700
TSL 2
TSL 3
TSL 4
0.14
0.04
0.08
0.062
0.23
0.06
0.12
0.081
0.32
0.08
0.17
0.120
0.50
0.12
0.26
0.184
0.254
0.706
0.475
1.432
0.486
1.684
(12.456)
(22.787)
(5)–(12)
(2)–(4)
(5)–(12)
(2)–(4)
(5)–(12)
(2)–(4)
28–(99)
10–(34)
0
0
(2)–(11)
(1)–(3)
(2)–(11)
(1)–(3)
78–(385)
22–(107)
(7)–(10)
(2)
(7)–(10)
(2)
(6)–(41)
(1)–(9)
(46)–(182)
(10)–(39)
0
0
(8)–(19)
(1)–(2)
(8)–(19)
(1)–(2)
(9)–(471)
(1)–(59)
13.74
6.71
0–0.15
15.46
6.88
0–0.19
23.39
10.82
0–0.28
34.96
16.07
0–0.41
0–109
0–241
0–122
0–270
0–182
0–408
0–269
0–610
0.7–7.3
1.5–15.4
0.7–7.5
1.5–15.7
1.1–11.5
2.4–24.5
1.6–16.8
3.5–36.1
0–1.3
0–2.6
0–1.6
0–3.3
0–2.2
0–4.6
0–3.3
0–6.9
15
....................
....................
9
....................
....................
....................
15
4
....................
9
....................
11
....................
15
4
....................
9
3
11
....................
(8)
4
(238)
(81)
(4)
(50)
(143)
4.3
....................
....................
9.0
....................
....................
....................
4.3
7.2
....................
9.0
....................
8.0
....................
4.3
7.2
....................
9.0
11.0
8.0
....................
73.0
7.2
1,498
25.3
15.6
60.7
236
0.1
93.5
6.4
0.1
93.5
6.4
0.1
93.5
6.4
93.5
0.0
6.5
....................
....................
....................
27.1
0.0
72.9
27.1
0.0
72.9
27.1
0.0
*72.9
....................
....................
....................
....................
....................
....................
....................
....................
....................
100.0
0.0
0.0
5.1
82.3
12.6
5.1
82.3
12.6
5.1
82.3
12.6
93.2
0.0
6.8
....................
....................
....................
....................
....................
....................
56.1
0.0
43.9
65.0
0.0
35.0
E:\FR\FM\08APR2.SGM
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16083
TABLE VI.30—SUMMARY OF QUANTITATIVE RESULTS FOR CONVENTIONAL COOKING PRODUCTS *—Continued
Category
TSL 1
Electric Oven/Standard Oven with or w/o a Catalytic Line
Net Cost (%) ......................................................................................................
No Impact (%) ...................................................................................................
Net Benefit (%) ..................................................................................................
Electric Oven/Self-Clean Oven
Net Cost (%) ......................................................................................................
No Impact (%) ...................................................................................................
Net Benefit (%) ..................................................................................................
TSL 2
TSL 3
TSL 4
....................
....................
....................
42.7
0.0
57.3
42.7
0.0
57.3
94.4
0.0
5.6
....................
....................
....................
....................
....................
....................
....................
....................
....................
78.5
0.0
21.5
mstockstill on PROD1PC66 with RULES2
* Parentheses indicate negative values. For LCCs, a negative value means an increase in LCC by the amount indicated.
** Changes in installed generation capacity in gigawatts (GW) by 2042 based on the AEO2008 Reference Case.
† CO2 emissions impacts include physical reductions at power plants and at households. NOX emissions impacts include physical reductions at
power plants and at households.
First, DOE considered TSL 4, the maxtech level. TSL 4 would likely save 0.50
quads of energy through 2042, an
amount DOE considers significant.
Discounted at 7 percent, the projected
energy savings through 2042 would be
0.12 quads. TSL 4 would result in a
decrease of $12.5 billion in the NPV of
consumer benefits, using a discount rate
of 7 percent. The emissions reductions
at TSL 4 are 34.96 Mt of CO2, 16.07 kt
of NOX, and 0 t to 0.41 t of Hg with a
corresponding value of $0 to $269
million for CO2, $1.6 to $16.8 million
for NOX, and $0 to $3.3 million for Hg,
using a discount rate of 7 percent. Total
generating capacity in 2042 is estimated
to decrease by 0.184 gigawatts (GW)
under TSL 4.
At TSL 4, DOE projects that the
average conventional cooking product
consumer would experience an increase
in LCC, with the exception of
consumers of electric coil cooktops. In
the case of the latter, the average
consumer would save $4 in LCC. With
the exception of electric coil cooktop
consumers, DOE estimated LCC
increases at TSL 4 for at least 65 percent
of consumers in the Nation that
purchase conventional cooking
products. The median payback period of
each product class, with the exception
of electric coil cooktops and gas selfcleaning ovens, is projected to be
substantially longer than the mean
lifetime of the product.
DOE estimates that the technology
needed to attain TSL 4 for electric
cooktops (improved contact
conductance) may not provide energy
savings under field conditions. 73 FR
62034, 62115 (Oct. 17, 2008). Measured
efficiency gains from improved contact
conductance have been obtained under
DOE test procedure conditions using an
aluminum test block. To ensure
consistent and repeatable testing, the
aluminum test block is used to establish
cooktop efficiency by measuring the
increased heat content of the block
during a test measurement. Because the
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test block is much flatter than actual
cooking vessels and, thus, allows for a
higher degree of thermal contact
between the block and coil element, the
efficiency gains with an actual cooking
vessel likely may not be as large or may
not even be achievable. Therefore, DOE
doubts that electric cooktop consumers
may actually realize savings with
products at TSL 4.
DOE estimated the projected change
in INPV at TSL 4 for each of the
following four general categories of
conventional cooking products: Gas
cooktops, electric cooktops, gas ovens,
and electric ovens. The projected
change in INPV ranges from an increase
of $28 million to a decrease of $99
million for gas cooktops, an increase of
$78 million to a decrease of $385
million for electric cooktops, a decrease
of $46 million to a decrease of $182
million for gas ovens, and a decrease of
$9 million to a decrease of $471 million
for electric ovens. At TSL 4, DOE
recognizes the risk of very large negative
impacts if manufacturers’ expectations
about reduced profit margins are
realized. In particular, if the high end of
the range of negative impacts is reached
as DOE expects, TSL 4 could result in
a net loss of 34 percent in INPV to gas
cooktop manufacturers, a net loss of 107
percent in INPV to electric cooktop
manufacturers, a net loss of 39 percent
to gas oven manufacturers, and a net
loss of 59 percent to electric oven
manufacturers.
After carefully considering the
analysis and weighing the benefits and
burdens of TSL 4, DOE concludes that
the potential benefits of energy savings
and emissions reductions are
outweighed by the potential multimillion dollar negative net economic
cost to the Nation’s consumers, the
economic burden on many individual
consumers, and the large capital
conversion costs that could result in a
reduction in INPV for manufacturers. In
addition, because conventional cooking
products are not rated for efficiency,
PO 00000
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TSL 4 would significantly impact the
industry in terms of the added cost of
testing, rating, and labeling these
products. Consequently, DOE concludes
that TSL 4 is not economically justified.
Next, DOE considered TSL 3, which
yielded primary energy savings
estimated at 0.32 quads of energy
through 2042, an amount which DOE
considers to be significant. Discounted
at 7 percent, the energy savings through
2042 would be 0.08 quads. TSL 3 would
result in an increase of $486 million in
the NPV of consumer benefit, using a
discount rate of 7 percent. The
emissions reductions are projected to be
23.39 Mt of CO2, 10.82 kt of NOX, and
0 t to 0.28 t of Hg with a corresponding
value of $0 to $182 million for CO2, $1.1
to $11.5 million for NOX, and $0 to $2.2
million for Hg, using a discount rate of
7 percent. Total generating capacity in
2042 under TSL 3 is estimated to
decrease by 0.120 GW.
For electric smooth cooktops and
electric self-cleaning ovens, TSL 3 does
not alter the current absence of a
standard because none of the candidate
standard levels for these products
provide economic savings to consumers.
However, average gas and electric coil
cooktop consumers would save $15 and
$4 in LCC, respectively, at TSL 3.
Average consumers of gas standard
ovens, gas self-cleaning ovens, and
electric standard ovens would realize
LCC savings of $9, $3, and $11,
respectively, at TSL 3. The median
payback period of each product class
impacted by TSL 3 is projected to be
shorter than the mean lifetime of the
products (19 years). For example, at TSL
3 the projected payback period is 4.3
years for average consumers of gas
cooktops, whereas the projected
payback period is 11.0 years for average
consumers of gas self-cleaning ovens.
Although TSL 3 provides LCC savings
to the average consumer, DOE estimates
a significant percentage of consumers of
gas self-cleaning ovens and electric
standard ovens would be burdened by
E:\FR\FM\08APR2.SGM
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Federal Register / Vol. 74, No. 66 / Wednesday, April 8, 2009 / Rules and Regulations
the standard (i.e., experience increases
in their LCC). DOE estimates that 56
percent of consumers of gas selfcleaning ovens and 43 percent of
consumers of electric standard ovens
would be burdened by TSL 3. In the
case of electric standard ovens, almost
50 percent of consumers would be
burdened. In the case of gas cooktops,
94 percent of consumers are not
impacted by TSL 3 (they already
purchase cooktops at TSL 3). Of the
remaining 6 percent of gas cooktop
consumers who are impacted by TSL 3,
nearly all would realize LCC savings.
For gas standard ovens, 82 percent
consumers are not impacted by TSL 3.
Of the remaining 18 percent of gas
standard oven consumers who are
affected by TSL 3, two-thirds realize
LCC savings. In the case of electric coil
cooktops, more than 70 percent of
consumers have a decrease in their LCC.
However, the efficiency gain achieved at
TSL 3 would be achieved through the
same technological change as TSL 4
(improved contact conductance). As
noted for TSL 4, DOE has significant
doubt that electric cooktop consumers
would actually realize economic savings
at TSL 3.
At TSL 3, the projected change in
INPV for each of the four general
categories of conventional cooking
products range from a decrease of $5
million to a decrease of $12 million for
gas cooktops, a decrease of $2 million to
a decrease of $11 million for electric
cooktops, a decrease of $6 million to a
decrease of $41 million for gas ovens,
and a decrease of $8 million to a
decrease of $19 million for electric
ovens. At TSL 3, DOE recognizes the
risk of negative impacts if
manufacturers’ expectations about
reduced profit margins are realized. In
particular, if the high end of the range
of impacts is reached as DOE expects,
TSL 3 could result in maximum net
losses of up to 4 percent in INPV for gas
cooktop manufacturers, 3 percent for
electric cooktop manufacturers, 9
percent for gas oven manufacturers, and
2 percent for electric oven
manufacturers.
Although DOE recognizes the
economic benefits to the Nation’s
consumers that could result from TSL 3,
DOE concludes that the benefits of a
standard at TSL 3 would be outweighed
by the economic burden on
conventional cooking product
consumers. The economic savings
realized by average consumers are
outweighed by the significant
percentage of gas self-cleaning oven and
electric standard oven consumers who
are burdened by the standard.
Considering that TSL 3 also adversely
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Jkt 217001
impacts manufacturers’ INPV and
would place a significant burden on
manufacturers to comply with the
standards, the benefits of energy savings
and emissions reductions are not
significant enough to outweigh the
burdens of the standard. Consequently,
DOE concludes that TSL 3 is not
economically justified.
DOE next considered TSL 2. TSL 2
would save 0.23 quads of energy
through 2042, an amount DOE considers
significant. Discounted at 7 percent, the
projected energy savings through 2042
would be 0.06 quads. DOE projects TSL
2 to yield an NPV of consumer benefit
of $475 million, using a discount rate of
7 percent. The estimated emissions
reductions are 15.46 Mt of CO2, 6.88 kt
to of NOX, and 0 t to 0.19 t of Hg with
a corresponding value of $0 to $122
million for CO2, $0.7 to $7.5 million for
NOX, and $0 to $1.6 million for Hg,
using a discount rate of 7 percent. Total
generating capacity in 2042 under TSL
2 would likely decrease by 0.081 GW.
The candidate standard levels for
each of the product classes that
comprise TSL 2 are the same as TSL 3
except for gas self-cleaning ovens. DOE
did not alter the current standard and
establish an efficiency level for gas selfcleaning ovens for TSL 2 because, as
described for TSL 3, efficiency levels
that go beyond the baseline level do not
yield LCC savings to a majority of gas
self-cleaning consumers. For all other
product classes, the impacts to
consumers at TSL 3 are identical to
those at TSL 2.
At TSL 2, the projected change in
INPV for each of the four general
categories of conventional cooking
products range from a decrease of $5
million to a decrease of $12 million for
gas cooktops, a decrease of $2 million to
a decrease of $11 million for electric
cooktops, a decrease of $7 million to a
decrease of $10 million for gas ovens,
and a decrease of $8 million to a
decrease of $19 million for electric
ovens. At TSL 2, DOE recognizes the
risk of negative impacts if
manufacturers’ expectations about
reduced profit margins are realized. In
particular, if the high end of the range
of impacts is reached as DOE expects,
TSL 2 could result in a net loss of 4
percent in INPV to gas cooktop
manufacturers, a net loss of 3 percent in
INPV to electric cooktop manufacturers,
a net loss of 2 percent to gas oven
manufacturers, and a net loss of 2
percent to electric oven manufacturers.
Although DOE recognizes the
economic benefits to the Nation’s
consumers that could result from TSL 2,
DOE concludes that the benefits of a
standard at TSL 2 would be outweighed
PO 00000
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by the economic burden that would be
placed upon conventional cooking
product consumers. The potential
economic savings realized by average
consumers are outweighed by the
significant percentage of electric
standard oven consumers who are
burdened by the standard and by the
significant risk that consumers of
electric coil cooktops would not realize
the savings projected for that product.
TSL 2 would also adversely impact
manufacturer INPV and would place a
significant burden on manufacturers to
comply with the standards.
Consequently, the benefits of energy
savings and emissions impacts of TSL 2
are not significant enough to outweigh
the burdens that would be created by
the standard. Consequently, DOE
concludes that TSL 2 is not
economically justified.
DOE next considered TSL 1. With
TSL 1, only amended energy
conservation standards consisting of
prescriptive requirements to eliminate
standing pilots for gas cooktops and gas
standard ovens would be promulgated.
DOE projects that TSL 1 would save
0.14 quads of energy through 2042, an
amount DOE considers significant.
Discounted at 7 percent, the projected
energy savings through 2042 would be
0.04 quads. DOE projects TSL 1 to yield
an NPV of consumer benefit of $254
million, using a discount rate of 7
percent. The estimated emissions
reductions are 13.74 Mt of CO2, 6.71 kt
of NOX, and 0 t to 0.15 t of Hg with a
corresponding value of $0 to $109
million for CO2, $0.7 to $7.3 million for
NOX, and $0 to $1.3 million for Hg,
using a discount rate of 7 percent. Total
generating capacity in 2042 under TSL
1 would decrease by 0.062 GW.
At TSL 1, average gas cooktop and gas
standard oven consumers would save
$13 and $6 in LCC, respectively. DOE
estimates that 94 percent of gas cooktop
consumers and 82 percent of gas
standard oven consumers would not be
affected at TSL 1. Of the remaining
impacted consumers, DOE estimates
that nearly all gas cooktop consumers
and over 70 percent of gas standard
oven consumers would realize LCC
savings due to the elimination of
standing pilots. The median payback
period for the impacted consumers is
4.3 years for gas cooktop consumers and
9.0 years for gas standard oven
consumers.
At TSL 1, the projected change in
INPV ranges from a decrease of $5
million to a decrease of $12 million for
gas cooktops and a decrease of $7
million to a decrease of $10 million for
gas ovens. At TSL 1, DOE recognizes the
risk of negative impacts if
E:\FR\FM\08APR2.SGM
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manufacturers’ expectations about
reduced profit margins are realized. In
particular, if the high end of the range
of impacts is reached as DOE expects,
TSL 1 could result in a net loss of 4
percent in INPV to gas cooktop
manufacturers and a net loss of 2
percent to gas oven manufacturers.
Although DOE estimates that TSL 1
would lead to some net loss in INPV to
gas cooktop and gas oven
manufacturers, because TSL 1 is
comprised of prescriptive requirements,
the industry would not face the
additional costs associated with
complying with performance
requirements. Currently, only
prescriptive standards for conventional
cooking products are in effect requiring
that gas cooking products with an
electrical supply cord not be equipped
with a constant burning pilot. As a
result, conventional cooking product
manufacturers are not currently subject
to the costs of testing the rated
performance of their products to label
and comply with performance-based
energy conservation standards. Because
TSL 1 effectively extends the existing
prescriptive requirement to all gas
cooking products regardless of whether
the products have an electrical supply
cord, DOE avoids burdening
manufacturers with testing, labeling,
and compliance costs that they
currently do not bear.
As stated in the October 2008 NOPR,
DOE recognizes that there is a small
subgroup of consumers that use gas
cooking products but are without
household electricity. 73 FR 62034,
62116 (Oct. 17, 2008). Under TSL 1,
these consumers are likely to be affected
because they would be required to use
an electrical source for cooking products
to operate the ignition system. For the
October 2008 NOPR, DOE market
research demonstrated that batterypowered electronic ignition systems
have been implemented in other
products, such as instantaneous gas
water heaters, barbeques, and furnaces,
and the use of such products is not
expressly prohibited by applicable
safety standards for gas cooking
products. Id. Therefore, DOE tentatively
concluded for the October 2008 NOPR
that households that use gas for cooking
and are without electricity would likely
have technological options that would
enable them to continue to use gas
cooking if standing pilot ignition
systems are eliminated. Id.
However, as detailed in section III.C.2
of today’s final rule, numerous
interested parties objected to the above
conclusion, and in particular,
commenters argued that there are
currently no commercially available gas
cooking products with battery-powered
electronic ignition systems that have
been certified to applicable U.S. safety
standards. In response to these
comments, DOE conducted additional
research on battery-powered ignition
systems for residential gas cooking
products, which confirmed commenters’
statements regarding the absence of any
gas cooking products with batterypowered electronic ignition systems
currently certified to applicable U.S.
safety standards. However, DOE
concludes that the primary barrier to
commercialization of battery-powered
ignition systems in gas cooking products
has been lack of market demand and
economic justification rather than
technological feasibility. DOE further
concludes that a gas range incorporating
one of these ignition systems could meet
the requirements of ANSI Z21.1. In
addition, DOE research suggests that the
market niche for gas cooking products
equipped with battery-powered ignition
systems, which would be created by a
standard at TSL 1, would likely attract
entrants among ignition component
suppliers and, therefore, that
technologically feasible alternative
ignition systems to standing pilots in
gas cooking products for households
without electricity will likely be
available by the time these energy
conservation standards are effective.
Although DOE recognizes the
economic impact that a standard at TSL
16085
1 would have upon a small subgroup of
consumers of gas cooking products,
DOE concludes that the benefits to the
significant majority of the Nation’s
consumers that could result from TSL 1
would outweigh the economic burden
that would be placed upon this
subgroup. Although TSL 1 would
adversely impact manufacturer INPV,
DOE has concluded that it would not
place a significant burden on
manufacturers to comply with the
standards in terms of changes to existing
manufacturing processes and
certification testing. Therefore, the
benefits of energy savings and emissions
impacts of TSL 1 are significant enough
to outweigh the burdens that would be
created by the standard. Consequently,
DOE concludes that TSL 1 is
economically justified.
In sum, after carefully considering the
analysis, the comments on the October
2008 NOPR, and the benefits and
burdens of each of the TSLs DOE
considered, the Secretary concludes that
amended standards for cooking
efficiency of conventional cooking
products, consisting of a prohibition of
constant burning pilots for all gas
kitchen ranges and ovens, will save a
significant amount of energy and are
technologically feasible and
economically justified. In addition, the
Secretary also concludes that no
amended cooking efficiency standard is
both technologically feasible and
economically justified for residential
electric kitchen ranges and ovens.
Therefore, DOE is not adopting any
energy conservation standards for
residential electric kitchen ranges and
ovens.
3. Microwave Ovens
Table VI.31 presents a summary of the
quantitative results for the microwave
oven TSLs pertaining to cooking
efficiency. The impacts at each TSL are
measured relative to a no-standards base
case.
TABLE VI.31—SUMMARY OF QUANTITATIVE RESULTS FOR MICROWAVE OVEN ENERGY FACTOR
mstockstill on PROD1PC66 with RULES2
Category
TSL 1
Primary Energy Saved (quads):
0% Discount Rate .....................................................................................................
7% Discount Rate .....................................................................................................
3% Discount Rate .....................................................................................................
Generation Capacity Reduction (GW) ** .........................................................................
NPV of Consumer Impacts (2006$ billion):
7% Discount Rate .....................................................................................................
3% Discount Rate .....................................................................................................
Industry Impacts:
Industry NPV (2006$ million) ...................................................................................
Industry NPV (% Change) ........................................................................................
Cumulative Emissions Impacts: †
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TSL 2
TSL 3
TSL 4
0.18
0.05
0.10
0.137
0.19
0.05
0.10
0.207
0.23
0.07
0.13
0.340
0.25
0.07
0.14
0.477
(1.23)
(2.06)
(3.33)
(6.05)
(6.32)
(11.68)
(10.05)
(18.70)
45–(200)
3–(14)
118–(388)
8–(27)
238–(679)
16–(47)
270–(1171)
19–(80)
E:\FR\FM\08APR2.SGM
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Federal Register / Vol. 74, No. 66 / Wednesday, April 8, 2009 / Rules and Regulations
TABLE VI.31—SUMMARY OF QUANTITATIVE RESULTS FOR MICROWAVE OVEN ENERGY FACTOR—Continued
Category
TSL 1
CO2 (Mt) ...................................................................................................................
NOX (kt) ....................................................................................................................
Hg (t) .........................................................................................................................
Value of Emissions Reductions:
CO2 (2007$ million)
7% Discount Rate .............................................................................................
3% Discount Rate .............................................................................................
NOX (2006$ million)
7% Discount Rate .............................................................................................
3% Discount Rate .............................................................................................
Hg (2006$ million)
7% Discount Rate .............................................................................................
3% Discount Rate .............................................................................................
Mean LCC Savings * (2006$) ..........................................................................................
Median PBP (years) ........................................................................................................
LCC Consumer Impacts:
Net Cost (%) .............................................................................................................
No Impact (%) ..........................................................................................................
Net Benefit (%) .........................................................................................................
TSL 2
TSL 3
TSL 4
22.88
2.55
0–0.46
33.46
3.75
0–0.68
53.89
6.06
0–1.10
74.67
8.42
0–1.52
0–192
0–404
0–277
0–589
0–443
0–948
0–612
0–1313
0.3–3.2
0.6–6.1
0.4–4.6
0.9–8.9
0.7–7.3
1.4–14.4
1.0–10.2
1.9–19.9
0–3.7
0–7.8
(7)
29.9
0–5.4
0–11.3
(21)
58.1
0–8.6
0–18.2
(40)
82.8
0–11.8
0–25.2
(66)
116.6
90.6
0.0
9.4
97.6
0.0
2.4
99.2
0.0
0.8
99.8
0.0
0.2
mstockstill on PROD1PC66 with RULES2
* Parentheses indicate negative values. For LCCs, a negative value means an increase in LCC by the amount indicated.
** Changes in installed generation capacity by 2042 based on the AEO2008 Reference Case.
† CO2 emissions impacts include physical reductions at power plants. NOX emissions impacts include physical reductions at power plants.
First, DOE considered TSL 4, the maxtech level for microwave oven cooking
efficiency. TSL 4 would save 0.25 quads
of energy through 2042, an amount DOE
considers significant. Discounted at 7
percent, the projected energy savings
through 2042 would be 0.07 quads. TSL
4 would result in a decrease of $10.05
billion in the NPV of consumer impacts,
using a discount rate of 7 percent. The
emissions reductions at TSL 4 are 74.67
Mt of CO2, 8.42 kt of NOX, and 0 t to
1.52 t of Hg with a corresponding value
of $0 to $612 million for CO2, $1.0 to
$10.2 million for NOX, and $0 to $11.8
million for Hg, using a discount rate of
7 percent. Total generating capacity in
2042 is estimated to decrease compared
to the reference case by 0.477 GW.
At TSL 4, DOE projects that the
average microwave oven consumer
would experience an increase in LCC.
The median payback period for the
average consumer is projected to be
substantially longer than the mean
lifetime of the product.
DOE estimated the projected change
in INPV ranges at TSL 4 from an
increase of $270 million to a decrease of
$1.171 billion. At TSL 4, DOE
recognizes the risk of very large negative
impacts if manufacturers’ expectations
about reduced profit margins are
realized. In particular, if the high end of
the range of negative impacts is reached,
as DOE expects, TSL 4 could result in
a net loss of 80 percent in INPV to
microwave oven manufacturers.
After carefully considering the
analysis and weighing the benefits and
burdens of TSL 4, DOE concludes that
the benefits of energy savings and
emissions reductions would be
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Jkt 217001
outweighed by a large decrease in the
NPV of consumer impacts, the economic
burden on many consumers, and the
large capital conversion costs that could
result in a reduction in INPV for
manufacturers. Consequently, DOE
concludes that TSL 4 is not
economically justified.
DOE next considered TSL 3. Primary
energy savings are estimated at 0.23
quads of energy through 2042, which
DOE considers significant. Discounted
at 7 percent, the energy savings through
2042 would be 0.07 quads. TSL 3 would
result in a decrease of $6.32 billion in
the NPV of consumer benefit, using a
discount rate of 7 percent. The
emissions reductions are projected to be
53.89 Mt of CO2, 6.06 kt of NOX, and
0 t to 1.10 t of Hg with a corresponding
value of $0 to $443 million for CO2, $0.7
to $7.3 million for NOX, and $0 to $8.6
million for Hg, using a discount rate of
7 percent. Total generating capacity in
2042 under TSL 3 is estimated to
decrease by 0.340 GW.
At TSL 3, DOE projects that the
average microwave oven consumer
would experience an increase in LCC.
The median payback period of the
average consumer is projected to be
substantially longer than the mean
lifetime of the product.
DOE estimated the projected change
in INPV ranges from an increase of $238
million to a decrease of $679 million. At
TSL 3, DOE recognizes the risk of very
large negative impacts if manufacturers’
expectations about reduced profit
margins are realized. In particular, if the
high end of the range of negative
impacts is reached, as DOE expects, TSL
3 could result in a net loss of 47 percent
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in INPV to microwave oven
manufacturers.
After carefully considering the
analysis and weighing the benefits and
burdens of TSL 3, DOE concludes that
the benefits of energy savings and
emissions reductions would be
outweighed by the large decrease in the
NPV of consumer impacts, the economic
burden on many consumers, and the
large capital conversion costs that could
result in a reduction in INPV for
manufacturers. Consequently, DOE
concludes that TSL 3 is not
economically justified.
DOE next considered TSL 2. DOE
projects that TSL 2 would save 0.19
quads of energy through 2042, an
amount DOE considers significant.
Discounted at 7 percent, the projected
energy savings through 2042 would be
0.05 quads. DOE projects TSL 2 to result
in a decrease in the NPV of consumer
impacts of $3.33 billion. The estimated
emissions reductions are 33.46 Mt of
CO2, 3.75 kt of NOX, and 0 t to 0.68 t
of Hg with a corresponding value of $0
to $227 million for CO2, $0.4 to $4.6
million for NOX, and $0 to $5.4 million
for Hg, using a discount rate of 7
percent. Total generating capacity in
2042 under TSL 2 would likely decrease
by 0.207 GW.
At TSL 2, DOE projects that the
average microwave oven consumer
would experience an increase in LCC.
The median payback period of the
average consumer is projected to be
substantially longer than the mean
lifetime of the product.
At TSL 2, the projected change in
INPV ranges from an increase of $118
million to a decrease of $388 million. At
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TSL 2, DOE recognizes the risk of
negative impacts if manufacturers’
expectations about reduced profit
margins are realized. In particular, if the
high end of the range of negative
impacts is reached, as DOE expects, TSL
2 could result in a net loss of 27 percent
in INPV to microwave oven
manufacturers.
After carefully considering the
analysis and weighing the benefits and
burdens of TSL 2, DOE concludes that
the benefits of energy savings and
emissions reductions would be
outweighed by the large decrease in the
NPV of consumer impacts, the economic
burden on many consumers, and the
large capital conversion costs that could
result in a reduction in INPV for
manufacturers. Consequently, DOE
concludes that TSL 2 is not
economically justified.
DOE next considered TSL 1. DOE
projects that TSL 1 would save 0.18
quads of energy through 2042, an
amount DOE considers significant.
Discounted at 7 percent, the projected
energy savings through 2042 would be
0.05 quads. For the Nation as a whole,
DOE projects TSL 1 to result in a
decrease in the NPV of consumer
impacts of $1.23 billion. The estimated
emissions reductions are 22.88 Mt of
CO2, 2.55 kt of NOX, and 0 t to 0.46 t
of Hg with a corresponding value of $0
to $192 million for CO2, $0.3 to $3.2
million for NOX, and $0 to $3.7 million
for Hg, using a discount rate of 7
percent. Total generating capacity in
2042 under TSL 1 would likely decrease
by 0.137 GW.
At TSL 1, DOE projects that the
average microwave oven consumer
would experience an increase in LCC.
The median payback period of the
average consumer is projected to be
substantially longer than the mean
lifetime of the product.
At TSL 1, the projected change in
INPV ranges from a decrease of $45
million to a decrease of $200 million. At
TSL 1, DOE recognizes the risk of
negative impacts if manufacturers’
expectations about reduced profit
margins are realized. In particular, if the
high end of the range of impacts is
reached, as DOE expects, TSL 1 could
result in a net loss of 14 percent in INPV
to microwave oven manufacturers.
After carefully considering the
analysis and weighing the benefits and
burdens of TSL 1, DOE concludes that
the benefits of energy savings and
emissions reductions would be
outweighed by the large decrease in the
NPV of consumer impacts, the economic
burden on many consumers, and the
large capital conversion costs that could
result in a reduction in INPV for
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manufacturers. Consequently, DOE
concludes that TSL 1 is not
economically justified.
In sum, after carefully considering the
analysis, the comments on the October
2008 NOPR, and the benefits and
burdens of each of the TSLs DOE
considered, the Secretary concludes that
no amended standard is both
technologically feasible and
economically justified for microwave
oven EF. Therefore, DOE is not adopting
any energy conservation standard for
microwave oven EF.
VII. Procedural Issues and Regulatory
Review
A. Review Under Executive Order 12866
Today’s regulatory action has been
determined to be a ‘‘significant
regulatory action’’ under section 3(f)(1)
of Executive Order 12866, ‘‘Regulatory
Planning and Review.’’ 58 FR 51735
(Oct. 4, 1993). Accordingly, this action
was subject to review under the
Executive Order by the Office of
Information and Regulatory Affairs
(OIRA) in the Office of Management and
Budget.
The Executive Order requires each
agency to identify in writing the specific
market failure or other specific problem
that it intends to address that warrants
agency action, as well as to assess the
significance of that problem in
evaluating whether any new regulation
is warranted. Executive Order 12866,
section 1(b)(1).
The October 2008 NOPR evaluated
the market failure that the proposed rule
would address. 73 FR 62034, 62122–23
(Oct. 17, 2008). DOE’s analysis for some
residential gas cooking products
explicitly quantifies and accounts for
the percentage of consumers that
already purchase more efficient
equipment and takes these consumers
into account when determining the
national energy savings associated with
various TSLs. The analysis suggests that
accounting for the market value of
energy savings alone (i.e., excluding any
possible additional ‘‘externality’’
benefits such as those noted below)
would produce enough benefits to yield
net benefits across a wide array of
products and circumstances. In the
October 2008 NOPR, DOE requested
additional data (including the
percentage of consumers purchasing
more efficient cooking products and the
extent to which consumers of all
product types will continue to purchase
more efficient equipment), in order to
test the existence and extent of these
consumer actions. 73 FR 62034, 62123
(Oct. 17, 2008). DOE received no such
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data from interested parties in response
to the October 2008 NOPR.
DOE believes that there is a lack of
consumer information and/or
information processing capability about
energy efficiency opportunities in the
home appliance market. If this is the
case, DOE would expect the energy
efficiency for cooking products to be
randomly distributed across key
variables such as energy prices and
usage levels. DOE has already identified
the percentage of consumers that
already purchase more efficient gas
cooktops and gas standard ovens.
However, DOE does not correlate the
consumer’s usage pattern and energy
price with the efficiency of the
purchased product. In the October 2008
NOPR, DOE sought data on the
efficiency levels of existing cooking
products by how often they are used
(e.g., how many times or hours the
product is used) and their associated
energy prices (and/or geographic regions
of the country). Id. DOE received no
such data from interested parties in
response to the October 2008 NOPR.
Therefore, DOE was unable to test for
today’s final rule the extent to which
purchasers of cooking products behave
as if they are unaware of the costs
associated with their energy
consumption.
A related issue is asymmetric
information (one party to a transaction
has more and better information than
the other) and/or high transactions costs
(costs of gathering information and
effecting exchanges of goods and
services). In many instances, the party
responsible for an appliance purchase
may not be the one who pays the cost
to operate it. For example, home
builders in large-scale developments
often make decisions about appliances
without input from home buyers and do
not offer options to upgrade those
appliances. Also, apartment owners
normally make decisions about
appliances, but renters often pay the
utility bills. If there were no
transactions costs, it would be in the
home builders’ and apartment owners’
interest to install appliances that buyers
and renters would choose. For example,
one would expect that a renter who
knowingly faces higher utility bills from
low-efficiency appliances would be
willing to pay less in rent, and the
apartment owner would indirectly bear
the higher utility cost. However, this
information is not readily available, and
it may not be in the renter’s interest to
take the time to develop it, or, in the
case of the landlord who installs a highefficiency appliance, to convey that
information to the renter.
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To the extent that asymmetric
information and/or high transactions
costs are problems, one would expect to
find certain outcomes for appliance
energy efficiency. For example, all
things being equal, one would not
expect to see higher rents for apartments
with high-efficiency appliances.
Conversely, if there were symmetric
information, one would expect
appliances with higher energy efficiency
in rental units where the rent includes
utilities compared to those where the
renter pays the utility bills separately.
Similarly, for single-family homes, one
would expect higher energy efficiency
levels for replacement units than for
appliances installed in new
construction. Within the new
construction market, one would expect
to see appliances with higher energy
efficiency levels in custom-built homes
(where the buyer has more say in
appliance choices) than in comparable
homes built in large-scale
developments.
DOE received no data from interested
parties in response to the October 2008
NOPR on the issue of asymmetric
information and/or high transactions
costs. Therefore, DOE was unable to
determine for today’s final rule the
extent to which asymmetric information
and/or high transaction costs are a
market failure.
In addition, this rulemaking is likely
to yield certain external benefits
resulting from improved energy
efficiency of cooking products that are
not captured by the users of such
equipment. These benefits include
externalities related to environmental
protection and energy security that are
not reflected in energy prices, such as
reduced emissions of greenhouse gases.
The TSLs which DOE evaluated resulted
in CO2, NOX, and Hg emissions
reductions. DOE also determined a
range of possible monetary benefits
associated with the emissions
reductions. DOE considered both the
emissions reductions and their possible
monetary benefit in determining the
economic feasibility of the TSLs.
DOE conducted an RIA and, under the
Executive Order, was subject to review
by the Office of Information and
Regulatory Affairs (OIRA) in the OMB.
DOE presented to OIRA the draft final
rule and other documents prepared for
this rulemaking, including the RIA, and
has included these documents in the
rulemaking record. They are available
for public review in the Resource Room
of the Building Technologies Program,
950 L’Enfant Plaza, SW., 6th Floor,
Washington, DC 20024, (202) 586–9127,
between 9 a.m. and 4 p.m., Monday
through Friday, except Federal holidays.
The RIA is contained as chapter 17 in
the TSD prepared for the rulemaking.
The RIA consists of (1) a statement of
the problem addressed by this
regulation, and the mandate for
government action; (2) a description and
analysis of the feasible policy
alternatives to this regulation; (3) a
quantitative comparison of the impacts
of the alternatives; and (4) the national
economic impacts of today’s standards.
In today’s final rule DOE is not adopting
any standards for microwave ovens.
Therefore, DOE performed an RIA solely
for conventional cooking products for
today’s final rule.
The RIA calculates the effects of
feasible policy alternatives to energy
conservation standards for conventional
cooking products and provides a
quantitative comparison of the impacts
of the alternatives. DOE evaluated each
alternative in terms of its ability to
achieve significant energy savings at
reasonable costs, and compared it to the
effectiveness of the proposed rule. DOE
analyzed these alternatives using a
series of regulatory scenarios as input to
the NIA Spreadsheets for the two
appliance products, which it modified
to allow inputs for voluntary measures.
For more details on how DOE modified
the NIA spreadsheets to determine the
impacts due to the various nonregulatory alternatives to standards,
refer to chapter 17 of the TSD
accompanying this notice.
As shown in Table VII.1 below, DOE
identified the following major policy
alternatives for achieving increased
energy efficiency in conventional
cooking products:
• No new regulatory action;
• Financial incentives;
fl Consumer rebates;
fl Consumer tax credits;
fl Manufacturer tax credits;
• Voluntary energy efficiency targets;
• Bulk government purchases;
• Early replacement; and
• The proposed approach (national
performance and prescriptive
standards).
TABLE VII.1—NON-REGULATORY ALTERNATIVES TO STANDARDS FOR CONVENTIONAL COOKING PRODUCTS
Net present value**
billion $
Energy
savings*
quads
Policy alternatives
No New Regulatory Action ....................................................................................................
Consumer Rebates ................................................................................................................
Consumer Tax Credits ...........................................................................................................
Manufacturer Tax Credits ......................................................................................................
Early Replacement ................................................................................................................
Today’s Standards at TSL 1 ..................................................................................................
7%
Discount rate
0
0.12
0.05
0.01
0.01
0.14
0
0.21
0.08
0.02
0.07
0.25
3%
Discount rate
0
0.60
0.27
0.06
0.12
0.71
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* Energy savings are in source quads.
** Net present value is the value in the present of a time series of costs and savings. DOE determined the net present value from 2012 to
2042 in billions of 2006 dollars.
*** Voluntary energy efficiency target and bulk government purchase alternatives are not considered because the percentage of the market at
TSL 1 (today’s standard) is well over the market adoption target level that each alternative strives to attain.
The net present value amounts shown
in Table VII.1 refer to the NPV for
consumers. The costs to the government
of each policy (such as rebates or tax
credits) are not included in the costs for
the NPV since, on balance, consumers
would be both paying for (through
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taxes) and receiving the benefits of the
payments. The following paragraphs
discuss each of the policy alternatives
listed in Table VII.1. (See the TSD
accompanying this notice, chapter 17.)
No New Regulatory Action. The case
in which no regulatory action is taken
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with regard to conventional cooking
products constitutes the ‘‘base case’’ (or
‘‘No Action’’) scenario. In this case,
between 2012 and 2042, conventional
cooking products are expected to use
10.3 quads of primary energy. Since this
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is the base case, energy savings and NPV
are zero by definition.
Consumer Rebates. Consumer rebates
cover a portion of the incremental
installed cost difference between
products meeting baseline efficiency
levels and those meeting higher
efficiency levels, which generally result
in a higher percentage of consumers
purchasing more efficient models. DOE
utilized market penetration curves from
a study that analyzed the potential of
energy efficiency in California.45 The
penetration curves are a function of
benefit-cost ratio (i.e., lifetime operating
costs savings divided by increased total
installed costs) to estimate the increased
market share of more efficient products
given incentives by a rebate program.
Using specific rebate amounts, DOE
calculated, for each of the considered
products, the benefit-cost ratio of the
more efficient appliance with and
without the rebate to project the
increased market penetration of the
product due to a rebate program.
For conventional cooking products
meeting the efficiency levels in TSL 1
(i.e., gas cooking products without
constant burning pilot lights), DOE
estimated that the annual increase in
consumer purchases of these products
due to consumer rebates would be 7.8
percent. DOE selected the portion of the
incremental costs covered by the rebate
(i.e., 100 percent) using data from rebate
programs conducted by 88 gas utilities,
electric utilities, and other State
government agencies.46 DOE estimated
that the impact of this policy would be
to permanently transform the market so
that the increased market share seen in
the first year of the program would be
maintained throughout the forecast
period. At the estimated participation
rates, consumer rebates would be
expected to provide 0.12 quads of
national energy savings and an NPV of
$0.21 billion (at a 7-percent discount
rate).
Although DOE estimated that
consumer rebates would provide
national benefits for conventional
cooking products, these benefits would
be smaller than the benefits resulting
from national performance standards at
the proposed levels. Thus, DOE rejected
consumer rebates as a policy alternative
to national performance standards.
45 Rufo, M. and F. Coito, California’s Secret
Energy Surplus: The Potential for Energy Efficiency
(prepared for The Energy Foundation and The
Hewlett Foundation by Xenergy, Inc.) (2002).
46 Because DOE was not able to identify consumer
rebate programs specific to conventional cooking
products, rebate amounts for another kitchen
appliance, dishwashers, were used to estimate the
impact from a rebate program providing incentives
for more efficient cooking products.
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Consumer Tax Credits. Consumer tax
credits cover a percentage of the
incremental installed cost difference
between products meeting baseline
efficiency levels and those with higher
efficiencies. Consumer tax credits are
considered a viable non-regulatory
market transformation program as
evidenced by the inclusion of Federal
consumer tax credits in EPACT 2005 for
various residential appliances. (Section
1333 of EPACT 2005; codified at 26
U.S.C. 25C) DOE reviewed the market
impact of tax credits offered by the
Oregon Department of Energy (ODOE)
(ODOE, No. 35 at p. 1) and Montana
Department of Revenue (MDR) (MDR,
No. 36 at p. 1) to estimate the effect of
a national tax credit program. To help
estimate the impacts from such a
program, DOE also reviewed analyses
prepared for the California Public
Utilities Commission,47 the Northwest
Energy Efficiency Alliance,48 and the
Energy Foundation/Hewlett
Foundation.49 For each of the appliance
products considered for this
rulemaking, DOE estimated that the
market effect of a tax credit program
would gradually increase over a time
period until it reached its maximum
impact. Once the tax credit program
attained its maximum effect, DOE
assumed the impact of the policy would
be to permanently transform the market
at this level.
For conventional cooking products,
DOE estimated that the market share of
efficient products meeting TSL 1 would
increase by 0.7 percent in 2012 and
increase over a 6-year period to an
annual maximum of 2.8 percent in 2020.
At these estimated participation rates,
consumer tax credits would be expected
to provide 0.05 quads of national energy
savings and an NPV of $0.08 billion (at
a 7-percent discount rate).50
DOE estimated that while consumer
tax credits would yield national benefits
for conventional cooking products,
these benefits would be much smaller
than the benefits from the proposed
47 Itron and KEMA, 2004/2005 Statewide
Residential Retrofit Single-Family Energy Efficiency
Rebate Evaluation (prepared for the California
Public Utilities Commission, Pacific Gas And
Electric Company, San Diego Gas and Electric
Company, Southern California Edison, Southern
California Gas Company, CPUC–ID# 1115–04)
(2007).
48 KEMA, Consumer Product Market Progress
Evaluation Report 3 (prepared for Northwest Energy
Efficiency Alliance, Report #07–174) (2007).
49 Rufo, M., and F. Coito, op. cit.
50 Because DOE was not able to identify consumer
tax credit programs specific to conventional
cooking products, increased market penetrations for
another kitchen appliance, dishwashers, were used
to estimate the impact from a tax credit program
providing incentives for more efficient conventional
cooking products and microwave ovens.
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16089
national performance standards. Thus,
DOE rejected consumer tax credits as a
policy alternative to national
performance standards.
Manufacturer Tax Credits.
Manufacturer tax credits are considered
a viable non-regulatory market
transformation program as evidenced by
the inclusion of Federal tax credits in
EPACT 2005 for manufacturers of
residential appliances. (Section 1334 of
EPACT 2005; codified at 26 U.S.C. 45M)
Similar to consumer tax credits,
manufacturer tax credits would
effectively result in lower product
prices to consumers by an amount that
covered part of the incremental price
difference between products meeting
baseline efficiency levels and those
meeting higher efficiency levels.
Because these tax credits would go to
manufacturers instead of consumers,
research indicates that fewer consumers
would be affected by a manufacturer tax
credit program than by consumer tax
credits.51 52 Although consumers would
benefit from price reductions passed
through to them by the manufacturers,
research demonstrates that
approximately half the consumers who
would benefit from a consumer tax
credit program would be aware of the
economic benefits of more efficient
technologies included in an appliance
manufacturer tax credit program. In
other words, research estimates that half
of the effect from a consumer tax credit
program is due to publicly available
information or promotions announcing
the benefits of the program. This effect,
referred to as the ‘‘announcement
effect,’’ is not part of a manufacturer tax
credit program. Therefore, DOE
estimated that the effect of a
manufacturer tax credit program would
be only half of the maximum impact of
a consumer tax credit program.
For conventional cooking products,
the percentage of consumers purchasing
products meeting TSL 1 would be
expected to increase by 0.6 percent due
to a manufacturer tax credit program.53
DOE assumed that the impact of the
manufacturer tax credit policy would be
to permanently transform the market so
51 K. Train, Customer Decision Study: Analysis of
Residential Customer Equipment Purchase
Decisions (prepared for Southern California Edison
by Cambridge Systematics, Pacific Consulting
Services, The Technology Applications Group, and
California Survey Research Services) (1994).
52 Lawrence Berkeley National Laboratory, EndUse Forecasting Group. Analysis of Tax Credits for
Efficient Equipment (1997). Available at https://
enduse.lbl.gov/Projects/TaxCredits.html. (Last
accessed April 24, 2008.)
53 DOE assumed that the manufacturer tax credit
program would affect only consumers of gas
cooking products, who did not need electric outlets
installed; therefore the increased percentage impact
includes only those consumers.
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that the increased market share seen in
the first year of the program would be
maintained throughout the forecast
period.
At the above estimated participation
rates, manufacturer tax credits would
provide 0.01 quads of national energy
savings and an NPV of $0.02 billion (at
a 7-percent discount rate) for
conventional cooking products.
DOE estimated that while
manufacturer tax credits would yield
national benefits for conventional
cooking products, these benefits would
be much smaller than the benefits from
national performance standards. Thus,
DOE rejected manufacturer tax credits
as a policy alternative to the proposed
national performance standards.
Voluntary Energy Efficiency Targets.
DOE estimates the impact of voluntary
energy efficiency targets by reviewing
the historical and projected market
transformation performance of past and
current ENERGY STAR programs.
However, DOE did not analyze the
potential impacts of voluntary energy
efficiency targets for conventional
cooking products because over 85
percent of the gas range market already
meets TSL 1. The ENERGY STAR
program typically targets products
where a maximum of approximately 25
percent of the existing market meets the
target efficiency level.54 Since the
market for gas ranges are well above the
25-percent threshold, DOE did not
consider this approach for conventional
cooking products.
Early Replacement. The early
replacement policy alternative envisions
a program to replace old, inefficient
units with models meeting efficiency
levels higher than baseline equipment.
Under an early replacement program,
State governments or electric and gas
utilities would provide financial
incentives to consumers to retire the
appliance early in order to hasten the
adoption of more efficient products. For
all of the considered products, DOE
modeled this policy by applying a 4percent increase in the replacement rate
above the natural rate of replacement for
failed equipment. DOE based this
percentage increase on program
experience with the early replacement
of appliances in the State of
Connecticut.55 DOE assumed the
54 Sanchez, M. and A. Fanara, ‘‘New Product
Development: The Pipeline for Future ENERGY
STAR Growth,’’ Proceedings of the 2000 ACEEE
Summer Study on Energy Efficiency in Buildings
(2000) Vol. 6, pp. 343–354.
55 Nexus and RLW Analytics, Impact, Process,
and Market Study of the Connecticut Appliance
Retirement Program: Overall Report, Final.
(Submitted to Northeast Utilities—Connecticut
Light and Power and the United Illuminating
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program would continue for as long as
it would take to ensure that the eligible
existing stock in the year that the
program began (2012) was completely
replaced.
For conventional cooking products,
this policy alternative would replace
old, inefficient units with models
meeting the efficiency levels in TSL 1.
DOE estimated that such an early
replacement program would be
expected to provide 0.01 quads of
national energy savings and an NPV of
$0.07 billion (at a 7-percent discount
rate).
Although DOE estimated that the
above early replacement programs for
each of the considered products would
provide national benefits, they would be
much smaller than the benefits resulting
from national performance standards.
Thus, DOE rejected early replacement
incentives as a policy alternative to
national performance standards.
Bulk Government Purchases. Under
this policy alternative, the government
sector would be encouraged to shift
their purchases to products that meet
the target efficiency levels above
baseline levels. Aggregating public
sector demand could provide a market
signal to manufacturers and vendors
that some of their largest customers
sought suppliers with products that met
an efficiency target at favorable prices.
This program also could induce ‘‘market
pull’’ impacts through manufacturers
and vendors achieving economies of
scale for high-efficiency products.
Under such a program, DOE would
assume that Federal, State, and local
government agencies would administer
it. At the Federal level, such a program
would add more efficient products for
which the Federal Energy Management
Program (FEMP) has energy efficient
procurement specifications.
However, DOE did not analyze the
potential impacts of bulk government
purchases for conventional cooking
products because over 85 percent of the
gas range market already meets TSL 1.
FEMP procurement specifications
typically promote products in the top 25
percent of the existing product offerings
in terms of efficiency. Since most of the
gas ranges sold in the base case already
comply with such specifications, DOE
was not able to consider this program as
a source of data for conventional
cooking products.
National Performance Standards (TSL
1 for conventional cooking products). As
indicated in the paragraphs above, none
of the alternatives DOE examined would
save as much energy as the amended
Company by Nexus Market Research, Inc. and RLW
Analytics, Inc.) (2005).
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energy conservation standards.
Therefore, DOE will adopt the efficiency
levels listed in section VI.D.
B. Review Under the Regulatory
Flexibility Act
The Regulatory Flexibility Act (5
U.S.C. 601 et seq.) requires preparation
of an initial regulatory flexibility
analysis (IRFA) for any rule that by law
must be proposed for public comment,
and a final regulatory flexibility analysis
(FRFA) for any such rule that an agency
adopts as a final rule, unless the agency
certifies that the rule, if promulgated,
will not have a significant economic
impact on a substantial number of small
entities. A regulatory flexibility analysis
examines the impact of the rule on
small entities and considers alternative
ways of reducing negative impacts.
Also, as required by Executive Order
13272, ‘‘Proper Consideration of Small
Entities in Agency Rulemaking,’’ 67 FR
53461 (August 16, 2002), DOE
published procedures and policies on
February 19, 2003, to ensure that the
potential impacts of its rules on small
entities are properly considered during
the rulemaking process. 68 FR 7990.
DOE has made its procedures and
policies available on the Office of the
General Counsel’s Web site: https://
www.gc.doe.gov.
The Small Business Administration
(SBA) classifies manufacturers of
household cooking appliances as small
businesses if they have 750 or fewer
employees. DOE used these small
business size standards, published at 61
FR 3286 (Jan. 31, 1996) and codified at
13 CFR part 121, to determine whether
any small entities would be required to
comply with today’s rule. The size
standards are listed by North American
Industry Classification System (NAICS)
code and industry description.
Household cooking appliance
manufacturing is classified under
NAICS 335221.
Bearing in mind the relevant NAICS
classification above, DOE determined
that none of the manufacturers of
microwave ovens sold in the U.S. are
small businesses under these SBA
classifications. 73 FR 62034, 62130 (Oct.
17, 2008). However, DOE identified two
domestic manufacturers of conventional
cooking appliances that meet the SBA
small business definition and are
affected by this rulemaking. Id. at
62128. DOE interviewed one of these
manufacturers, and also obtained from
larger manufacturers information about
the impacts of standards on these small
manufacturers of conventional cooking
products. Id. DOE reviewed the
proposed rule under the provisions of
the Regulatory Flexibility Act and the
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procedures and policies published on
February 19, 2003. Id. On the basis of
this review, DOE determined that it
could not certify that its proposed
standards for conventional cooking
products (TSL 1), if promulgated, would
have no significant economic impact on
a substantial number of small entities.
Id. at 62128–29. DOE made this
determination due to the potential
impact on manufacturers of gas cooking
products generally, including small
businesses, of the proposed standard’s
elimination of standing pilot lights. Id.
Because of these potential impacts on
small manufacturers, DOE prepared an
IRFA during the NOPR stage of this
rulemaking. DOE provided the IRFA in
its entirety in the October 2008 NOPR
(73 FR 62034, 62129–30 (Oct. 17, 2008)),
and also transmitted a copy to the Chief
Counsel for Advocacy of the SBA for
review. Chapter 13 of the TSD
accompanying this notice contains more
information about the impact of this
rulemaking on manufacturers.
DOE has prepared a FRFA for this
rulemaking, which is presented in the
following discussion. DOE is
transmitting a copy of this FRFA to the
Chief Counsel for Advocacy of the SBA.
The FRFA below is written in
accordance with the requirements of the
Regulatory Flexibility Act.
mstockstill on PROD1PC66 with RULES2
1. Reasons for the Final Rule
Title III of EPCA sets forth a variety
of provisions designed to improve
energy efficiency. Part A of Title III (42
U.S.C. 6291–6309) provides for the
‘‘Energy Conservation Program for
Consumer Products Other Than
Automobiles.’’ The program covers
consumer products and certain
commercial products (all of which are
referred to hereafter as ‘‘covered
products’’), including residential
cooking products. (42 U.S.C. 6292(10))
DOE publishes today’s final rule to
amend energy conservation standards
for conventional cooking appliances by
eliminating standing pilot ignition
systems.
2. Objectives of, and Legal Basis for, the
Rule
EPCA provides criteria for prescribing
new or amended standards for covered
products and equipment. As indicated
above, any new or amended standard for
conventional cooking products must be
designed to achieve the maximum
improvement in energy efficiency that is
technologically feasible and
economically justified (42 U.S.C.
6295(o)(2)(A)), although EPCA
precludes DOE from adopting any
standard that would not result in
significant conservation of energy. (42
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U.S.C. 6295(o)(3)(B)) Moreover, DOE
may not prescribe a standard (1) for
certain products, if no test procedure
has been established for the product; or
(2) if DOE determines by rule that the
standard is not technologically feasible
or economically justified. (42 U.S.C.
6295(o)(3)) The Act (42 U.S.C.
6295(o)(2)(B)(i)) also provides that, in
deciding whether a standard is
economically justified, DOE must, after
receiving comments on the proposed
standard, determine whether the
benefits of the standard exceed its
burdens by considering, to the greatest
extent practicable, weighing seven
factors as described in section II.A of the
preamble. EPCA directs DOE to
undertake energy conversation
standards rulemakings for cooking
products according to the schedules
established in 42 U.S.C. 6295(h)(2).
3. Description and Estimated Number of
Small Entities Regulated
Through market research, interviews
with manufacturers of all sizes, and
discussions with trade groups, DOE was
able to identify two small businesses
that manufacture conventional cooking
appliances which would be affected by
today’s rule.
4. Description and Estimate of
Compliance Requirements
Potential impacts on all
manufacturers of conventional cooking
appliances vary by TSL. Margins for all
businesses could be impacted negatively
by the adoption of any TSL, since all
manufacturers have expressed an
inability to pass on cost increases to
retailers and consumers. The two small
domestic businesses under discussion
differ from their competitors in that they
are focused on cooking appliances and
are not diversified appliance
manufacturers. Therefore, any rule
affecting products manufactured by
these small businesses will impact them
disproportionately because of their size
and their focus on cooking appliances.
However, due to the low number of
competitors that agreed to be
interviewed, DOE was not able to
characterize this industry segment with
a separate cash-flow analysis due to
concerns about maintaining
confidentiality and uncertainty
regarding the quantitative impact on
revenues of a standing pilot ban.
At TSL 1 for gas ovens and gas
cooktops, the elimination of standing
pilot lights would eliminate one of the
niches that these two small businesses
serve in the cooking appliance industry.
Both businesses also manufacture ovens
and cooktops with electronic ignition
systems, but the ignition source would
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16091
no longer be a differentiator within the
industry as it is today. The result would
be a potential loss of market share since
consumers would be able to choose
from a wider variety of competitors, all
of which operate at much higher
production scales.
For all other TSLs concerning
conventional cooking appliances (which
have not been selected in today’s final
rule), the impact on small, focused
business entities would be
proportionately greater than for their
competitors since these businesses lack
the scale to afford significant R&D
expenses, capital expansion budgets,
and other resources when compared to
larger entities. The exact extent to
which smaller entities would be
affected, however, is hard to gauge,
because manufacturers did not respond
to questions regarding all investment
requirements by TSL during interviews.
Notwithstanding this limitation,
research associated with other small
entities in prior rulemakings suggests
that many costs associated with
complying with rulemakings are fixed,
regardless of production volume.
Since all domestic manufacturers
already manufacture all of their
conventional cooking appliances with
electronic ignition modules as a
standard feature or as an option for
consumers, the cost of converting the
remaining three domestic manufacturers
exclusively to electronic ignition
modules would be relatively modest.
However, given their focus and scale,
any conventional cooking appliance
rule would affect these two domestic
small businesses disproportionately
compared to their larger and more
diversified competitor.
5. Significant Issues Raised by Public
Comments
Peerless-Premier commented in
response to the October 2008 NOPR that
it is a privately held company that
employs about 300 people located at
two manufacturing plants. PeerlessPremier focuses on the value segment of
the market, with a large percentage of its
business attributable to standing pilot
ranges, which represent half of the gas
ranges it produces. That company stated
that DOE’s proposed ban on standing
pilot ranges would have a disastrous
effect on Peerless-Premier’s business. It
commented that it has remained
competitive largely because of niche
positioning in the market, and that
many customers choose its product line
because of the standing pilot ranges.
Without this ‘‘sell benefit,’’ PeerlessPremier believes much of its business
could go elsewhere, which would
ultimately result in significant job losses
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at its two manufacturing sites. (PeerlessPremier, No. 42 at pp. 1–2; Peerless
Letter, No. 55 at p. 1) AGA expressed
concern that, in response to the
November 2007 ANOPR, several
manufacturers indicated they would be
harmed if standing pilots were
eliminated, but AGA felt that small
business impacts were not adequately
addressed. (AGA, Public Meeting
Transcript, No. 40.5 at p. 17)
As described earlier, DOE contacted
two small manufacturers of
conventional cooking products to
determine the extent that eliminating
standing pilot lights would affect their
businesses. Both companies stated they
would experience material harm.
However, because they did not provide
supporting detail, DOE was not able to
quantify the exact extent to which
smaller entities would be affected.
Therefore, DOE cannot verify their
claims that they would be severely
impacted by a standard that eliminates
standing pilot lights. Furthermore, as
discussed in section VI.D.2 above, DOE
believes alternatives to standing pilot
lights exist that would meet the
standard in today’s final rule, and the
Department does not believe
manufacturers will be more severely
impacted than estimated in the
Manufacturers Impact Analysis.
6. Steps DOE Has Taken To Minimize
the Economic Impact on Small
Manufacturers
In today’s final rule, the only TSL
under consideration for conventional
cooking appliances is the elimination of
standing pilot ignition systems for gas
ovens and gas cooktops. All
manufacturers of such appliances with
standing pilot systems stated during
interviews that there are no known
alternatives on the market today that
would allow their appliances to meet
safety standards (such as ANSI Z21.1),
while not using a line-powered ignition
system or standing pilots. Although
battery-powered ignition systems have
found application in a few cooking
products such as the outdoor gas
barbeque market, none of such systems
have yet to find application in indoor
cooking appliances. During an MIA
interview, one manufacturer expressed
doubt that any third-party supplier
would develop such a solution, given
the small, and shrinking market that
standing pilot-equipped ranges
represent. Another manufacturer stated,
however, that while the market share of
gas cooking products with standing
pilot ignition systems has been
declining, a substantial market is still
served by such appliances. DOE
research suggests that battery-powered
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ignition systems could be incorporated
by manufacturers at a modest cost if
manufacturer’s market research
suggested that a substantial number of
consumers found such a product
attribute important, and that ignition
system manufacturers may consider
battery-powered ignitions systems a
viable niche product when these
standards are effective. DOE notes that
such systems have been incorporated
successfully in a range of related
appliances, such as instantaneous water
heaters and gas fireplaces. Further, DOE
believes that there is nothing in the
applicable safety standards that would
prohibit such ignition systems from
being implemented on gas cooking
products. Therefore, DOE believes that
households that use gas for cooking and
are without electricity will likely have
technological options that would enable
them to continue to use gas cooking
products without standing pilot ignition
systems.
In addition to the TSL being
considered, the TSD associated with
this final rule includes a report referred
to in section VII.A in the preamble as
the RIA (discussed earlier in this report
and in detail in chapter 17 of the TSD
accompanying this notice). For
conventional cooking appliances, this
report discusses the following policy
alternatives: (1) No standard, (2)
consumer rebates, (3) consumer tax
credits, (4) manufacturer tax credits, and
(5) early replacement. With the
exception of consumer rebates, the
energy savings of these regulatory
alternatives are at least three times
smaller than those expected from the
standard levels under consideration.
The economic impacts mirror these
regulatory alternatives.
The conventional cooking appliance
industry is very competitive. The two
small businesses differentiate their
products from most of their larger
competitors by offering their products in
non-traditional sizes and with standing
pilot ignition systems. Three primary
consumer groups purchasing standing
pilot-equipped products were identified
by manufacturers in their MIA
interviews: (1) Consumers without line
power near the range (or in the house);
(2) consumers who prefer appliances
without line power for religious reasons;
and (3) consumers seeking the lowest
initial appliance cost. Manufacturers
could not identify the size of the
respective market segments, but
demographics suggest that initial price
is the primary reason that consumers are
opting for standing pilot-equipped
ranges. Consumer subgroups that
eschew line power and homes without
line power cannot alone explain why up
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to 18 percent of gas cooking appliances
are bought with standing pilot ignition
systems. Furthermore, all manufacturers
already make gas ranges with electronic
ignition, including the high-volume
domestic manufacturer of conventional
cooking appliances with standing pilots.
Thus, the primary benefit of standing
pilot ignition systems appears to be the
differentiation of the small businesses
from most higher-volume competitors.
While the actual revenue benefit is hard
to quantify, both small business
manufacturers stated during interviews
that the company would expect to
experience material economic harm if
standing pilot ignition systems were
eliminated.
Due to the low number of small
business respondents to DOE inquiries
and the uncertainty regarding the
potential impact of TSL 1 on small
conventional cooking appliance
manufacturers, DOE was not able to
conduct a separate small business
impact analysis.
As mentioned above, the other policy
alternatives (no standard, consumer
rebates, consumer tax credits,
manufacturer tax credits, and early
replacement) are described in section
VII.A of the preamble and in the
regulatory impact analysis (chapter 17
of the TSD accompanying this notice).
Since the impacts of these policy
alternatives are lower than the impacts
described above for the proposed
standard levels, DOE expects that the
impacts to small manufacturers would
also be less than the impacts described
above for the proposed standard level.
DOE has reviewed today’s final rule
under the provisions of the Regulatory
Flexibility Act and the policies and
procedures published on February 19,
2003. The previous discussion describes
how small business impacts entered
into DOE’s selection of today’s
standards for conventional cooking
products. DOE made its decision
regarding standards by beginning with
the highest level considered (TSL 4) and
successively eliminating TSLs until it
found a TSL that is both technically
feasible and economically justified,
taking into account other EPCA criteria.
As discussed previously, DOE did not
receive detailed data from small
manufacturers to quantify the impacts of
today’s standards on small
manufacturers of conventional cooking
products.
C. Review Under the Paperwork
Reduction Act
DOE stated in the October 2008 NOPR
that this rulemaking would impose no
new information and recordkeeping
requirements, and that OMB clearance
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power and responsibilities among the
various levels of government. 73 FR
62034, 62131 (Oct. 17, 2008). DOE
received no comments on this issue in
response to the October 2008 NOPR,
and its conclusions on this issue are the
same for the final rule as they were for
the proposed rule. Therefore, DOE is
taking no further action in today’s final
rule with respect to Executive Order
13132.
D. Review Under the National
Environmental Policy Act
DOE prepared an environmental
assessment of the impacts of the
potential standards it considered for
today’s final rule which it has published
as chapter 16 within the TSD for the
final rule. DOE found the environmental
effects associated with today’s standard
levels for conventional cooking
products to be insignificant. Therefore,
DOE is issuing a Finding of No
Significant Impact (FONSI) pursuant to
the National Environmental Policy Act
of 1969 (NEPA) (42 U.S.C. 4321 et seq.),
the regulations of the Council on
Environmental Quality (40 CFR parts
1500–1508), and DOE’s regulations for
compliance with the NEPA (10 CFR part
1021). The FONSI is available in the
docket for this rulemaking.
mstockstill on PROD1PC66 with RULES2
is not required under the Paperwork
Reduction Act (PRA) (44 U.S.C. 3501 et
seq.). 73 FR 62034, 62130 (Oct. 17,
2008). DOE received no comments on
this in response to the October 2008
NOPR and, as with the proposed rule,
today’s rule imposes no information and
recordkeeping requirements. Therefore,
DOE has taken no further action in this
rulemaking with respect to the
Paperwork Reduction Act.
F. Review Under Executive Order 12988
With respect to the review of existing
regulations and the promulgation of
new regulations, section 3(a) of
Executive Order 12988, ‘‘Civil Justice
Reform,’’ 61 FR 4729 (Feb. 7, 1996),
imposes on Federal agencies the general
duty to adhere to the following
requirements: (1) Eliminate drafting
errors and ambiguity; (2) write
regulations to minimize litigation; and
(3) provide a clear legal standard for
affected conduct rather than a general
standard and promote simplification
and burden reduction. Section 3(b) of
Executive Order 12988 specifically
requires that Executive agencies make
every reasonable effort to ensure that the
regulation (1) clearly specifies the
preemptive effect, if any; (2) clearly
specifies any effect on existing Federal
law or regulation; (3) provides a clear
legal standard for affected conduct
while promoting simplification and
burden reduction; (4) specifies the
retroactive effect, if any; (5) adequately
defines key terms; and (6) addresses
other important issues affecting clarity
and general draftsmanship under any
guidelines issued by the Attorney
General. Section 3(c) of Executive Order
12988 requires Executive agencies to
review regulations in light of applicable
standards in section 3(a) and section
3(b) to determine whether they are met
or it is unreasonable to meet one or
more of them. DOE has completed the
required review and determined that, to
the extent permitted by law, the final
regulations meet the relevant standards
of Executive Order 12988.
E. Review Under Executive Order 13132
Executive Order 13132, ‘‘Federalism,’’
64 FR 43255 (August 4, 1999), imposes
certain requirements on agencies
formulating and implementing policies
or regulations that preempt State law or
that have Federalism implications. The
Executive Order requires agencies to
examine the constitutional and statutory
authority supporting any action that
would limit the policymaking discretion
of the States and to carefully assess the
necessity for such actions. The
Executive Order also requires agencies
to have an accountable process to
ensure meaningful and timely input by
State and local officials in the
development of regulatory policies that
have Federalism implications. On
March 14, 2000, DOE published a
statement of policy describing the
intergovernmental consultation process
it will follow in the development of
such regulations. 65 FR 13735.
In accordance with DOE’s statement
of policy describing the
intergovernmental consultation process
it will follow in the development of
regulations that have Federalism
implications, DOE examined the
proposed rule and determined that the
rule would not have a substantial direct
effect on the States, on the relationship
between the national government and
the States, or on the distribution of
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G. Review Under the Unfunded
Mandates Reform Act of 1995
As indicated in the October 2008
NOPR, DOE reviewed the proposed rule
under Title II of the Unfunded Mandates
Reform Act of 1995 (Pub. L. 104–4)
(UMRA), which imposes requirements
on Federal agencies when their
regulatory actions will have certain
types of impacts on State, local, and
Tribal governments and the private
sector. 73 FR 62034, 62131 (Oct. 17,
2008). DOE concluded that, although
the proposed rule would not contain an
intergovernmental mandate, it might
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16093
result in expenditure of $100 million or
more in one year by the private sector.
Id. Therefore, in the October 2008
NOPR, DOE addressed the UMRA
requirements that it prepare a statement
as to the basis, costs, benefits, and
economic impacts of the proposed rule,
and that it identify and consider
regulatory alternatives to the proposed
rule. Id. DOE received no comments
concerning the UMRA in response to
the October 2008 NOPR. However, as
explained above, a number of products
originally bundled in this rulemaking
have either had standards set separately
or will be subject to further rulemaking
action. Consequently, this final rule will
not result in the expenditure of $100
million or more in any one year.
Therefore, DOE is taking no further
action in today’s final rule with respect
to the UMRA.
H. Review Under the Treasury and
General Government Appropriations
Act, 1999
DOE determined that, for this
rulemaking, it need not prepare a
Family Policymaking Assessment under
Section 654 of the Treasury and General
Government Appropriations Act, 1999
(Pub. L. 105–277). Id. DOE received no
comments concerning Section 654 in
response to the October 2008 NOPR,
and, therefore, takes no further action in
today’s final rule with respect to this
provision.
I. Review Under Executive Order 12630
DOE determined under Executive
Order 12630, ‘‘Governmental Actions
and Interference with Constitutionally
Protected Property Rights’’ 53 FR 8859
(March 18, 1988), that the proposed rule
would not result in any takings which
might require compensation under the
Fifth Amendment to the U.S.
Constitution. 73 FR 62034, 62131 (Oct.
17, 2008). DOE received no comments
concerning Executive Order 12630 in
response to the October 2008 NOPR,
and, therefore, takes no further action in
today’s final rule with respect to this
Executive Order.
J. Review Under the Treasury and
General Government Appropriations
Act, 2001
Section 515 of the Treasury and
General Government Appropriations
Act, 2001 (44 U.S.C. 3516 note) provides
for agencies to review most
disseminations of information to the
public under guidelines established by
each agency pursuant to general
guidelines issued by OMB. OMB’s
guidelines were published at 67 FR
8452 (Feb. 22, 2002), and DOE’s
guidelines were published at 67 FR
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62446 (Oct. 7, 2002). DOE has reviewed
today’s final rule under the OMB and
DOE guidelines and has concluded that
it is consistent with applicable policies
in those guidelines.
K. Review Under Executive Order 13211
Executive Order 13211, ‘‘Actions
Concerning Regulations That
Significantly Affect Energy Supply,
Distribution, or Use,’’ 66 FR 28355 (May
22, 2001) requires Federal agencies to
prepare and submit to OIRA a Statement
of Energy Effects for any significant
energy action. DOE determined that the
proposed rule was not a ‘‘significant
energy action’’ within the meaning of
Executive Order 13211. 73 FR 62034,
62132 (Oct. 17, 2008). Accordingly, it
did not prepare a Statement of Energy
Effects on the proposed rule. DOE
received no comments on this issue in
response to the October 2008 NOPR. As
with the proposed rule, DOE has
concluded that today’s final rule is not
a significant energy action within the
meaning of Executive Order 13211, and
has not prepared a Statement of Energy
Effects on the rule.
mstockstill on PROD1PC66 with RULES2
L. Review Under the Information
Quality Bulletin for Peer Review
On December 16, 2004, the OMB, in
consultation with the Office of Science
and Technology, issued its ‘‘Final
Information Quality Bulletin for Peer
Review’’ (the Bulletin), which was
published in the Federal Register on
January 14, 2005. 70 FR 2664. The
purpose of the Bulletin is to enhance the
quality and credibility of the Federal
government’s scientific information.
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The Bulletin establishes that certain
scientific information shall be peer
reviewed by qualified specialists before
it is disseminated by the Federal
government. As indicated in the October
2008 NOPR, this includes influential
scientific information related to agency
regulatory actions, such as the analyses
in this rulemaking. 73 FR 62034, 62132
(Oct. 17, 2008).
As more fully set forth in the October
2008 NOPR, DOE held formal inprogress peer reviews of the types of
analyses and processes that DOE has
used in considering energy conservation
standards as part of this rulemaking,
and issued a report on these peer
reviews. Id.
As required by 5 U.S.C. 801, DOE will
submit to Congress a report regarding
the issuance of today’s final rule. The
report will state that it has been
determined that the rule is not a ‘‘major
rule’’ as defined by 5 U.S.C. 804.
VIII. Approval of the Office of the
Secretary
The Secretary of Energy has approved
publication of today’s final rule.
List of Subjects in 10 CFR Part 430
Administrative practice and
procedure, Energy Conservation test
procedures, Household appliances,
Imports.
Frm 00056
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For the reasons stated in the preamble,
chapter II, subchapter D, of Title 10 of
the Code of Federal Regulations, Part
430 is amended to read as set forth
below:
■
PART 430—ENERGY CONSERVATION
PROGRAM FOR CONSUMER
PRODUCTS
1. The authority citation for part 430
continues to read as follows:
■
Authority: 42 U.S.C. 6291–6309; 28 U.S.C.
2461 note.
2. Section 430.32 of subpart C is
amended by revising paragraph (j) to
read as follows:
■
M. Congressional Notification
PO 00000
Issued in Washington, DC, on March 31,
2009.
Steven G. Chalk,
Principal Deputy Assistant Secretary, Energy
Efficiency and Renewable Energy.
§ 430.32 Energy and water conservation
standards and effective dates.
*
*
*
*
*
(j) Cooking Products. (1) Gas cooking
products with an electrical supply cord
shall not be equipped with a constant
burning pilot light. This standard is
effective on January 1, 1990.
(2) Gas cooking products without an
electrical supply cord shall not be
equipped with a constant burning pilot
light. This standard is effective on
April 9, 2012.
*
*
*
*
*
Appendix
[The following letter from the Department of
Justice will not appear in the Code of Federal
Regulations.]
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16096
Federal Register / Vol. 74, No. 66 / Wednesday, April 8, 2009 / Rules and Regulations
[FR Doc. E9–7545 Filed 4–7–09; 8:45 am]
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BILLING CODE 6450–01–C
Agencies
[Federal Register Volume 74, Number 66 (Wednesday, April 8, 2009)]
[Rules and Regulations]
[Pages 16040-16096]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-7545]
[[Page 16039]]
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Part II
Department of Energy
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10 CFR Part 430
Energy Conservation Program: Energy Conservation Standards for Certain
Consumer Products (Dishwashers, Dehumidifiers, Microwave Ovens, and
Electric and Gas Kitchen Ranges and Ovens) and for Certain Commercial
and Industrial Equipment (Commercial Clothes Washers); Final Rule
Federal Register / Vol. 74, No. 66 / Wednesday, April 8, 2009 / Rules
and Regulations
[[Page 16040]]
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DEPARTMENT OF ENERGY
10 CFR Part 430
[Docket Number: EERE-2006-STD-0127]
RIN 1904-AB49
Energy Conservation Program: Energy Conservation Standards for
Certain Consumer Products (Dishwashers, Dehumidifiers, Microwave Ovens,
and Electric and Gas Kitchen Ranges and Ovens) and for Certain
Commercial and Industrial Equipment (Commercial Clothes Washers)
AGENCY: Office of Energy Efficiency and Renewable Energy, Department of
Energy.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Department of Energy (DOE) is announcing that it is
amending energy conservation standards pertaining to the cooking
efficiency of residential gas kitchen ranges and ovens, because it has
determined that such standards would be technologically feasible and
economically justified and would result in significant conservation of
energy, the three primary statutory criteria for adoption of standards
under the Energy Policy and Conservation Act (EPCA). DOE is not
adopting energy conservation standards pertaining to the cooking
efficiency of residential electric kitchen ranges and ovens and
microwave ovens, because it has determined that such standards would
not be technologically feasible and economically justified. At this
point, DOE has decided to defer its decision regarding adoption of
amended energy conservation standards for the energy efficiency of
commercial clothes washers and standby mode and off mode power
consumption by microwave ovens, pending further rulemaking. Finally,
DOE is not adopting amended standards for dishwashers and dehumidifiers
in this rulemaking, because recent amendments to EPCA have already set
standards for those products.
DATES: The effective date of this rule is June 8, 2009. Compliance with
the standards set by today's final rule is required on April 9, 2012.
ADDRESSES: For access to the docket to read background documents, the
technical support document, transcripts of the public meetings in this
proceeding, or comments received, visit the U.S. Department of Energy,
Resource Room of the Building Technologies Program, 950 L'Enfant Plaza,
SW., 6th Floor, Washington, DC 20024, (202) 586-2945, between 9 a.m.
and 4 p.m., Monday through Friday, except Federal holidays. Please call
Ms. Brenda Edwards at the above telephone number for additional
information regarding visiting the Resource Room. You may also obtain
copies of certain previous rulemaking documents in this proceeding
(i.e., framework document, advance notice of proposed rulemaking,
notice of proposed rulemaking), draft analyses, public meeting
materials, and related test procedure documents from the Office of
Energy Efficiency and Renewable Energy's Web site at https://www1.eere.energy.gov/buildings/appliance_standards/residential/cooking_products.html
FOR FURTHER INFORMATION CONTACT: Mr. Stephen Witkowski, U.S. Department
of Energy, Office of Energy Efficiency and Renewable Energy, Building
Technologies Program, EE-2J, 1000 Independence Avenue, SW., Washington,
DC 20585-0121. Telephone: (202) 586-7463. E-mail:
Stephen.Witkowski@ee.doe.gov.
Mr. Eric Stas or Mr. Michael Kido, U.S. Department of Energy,
Office of the General Counsel, GC-72, 1000 Independence Avenue, SW.,
Washington, DC 20585-0121. Telephone: (202) 586-9507. E-mail:
Eric.Stas@hq.doe.gov or Michael.Kido@hq.doe.gov.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Summary of the Final Rule
A. The Standard Levels
1. Statutorily Set Standard Levels for Dehumidifiers and
Dishwashers
2. The Standard Levels for the Energy Efficiency of Residential
Cooking Products
3. Further Rulemaking for Commercial Clothes Washers and
Microwave Ovens
B. Current Federal Standards
C. Benefits and Burdens to Purchasers of Cooking Products
D. Impact on Manufacturers
E. National Benefits
F. Conclusion
II. Introduction
A. Authority
B. Background
1. Current Standards
2. History of Standards Rulemaking for the Two Appliance
Products
3. Further Rulemaking To Consider Energy Conservation Standards
for Microwave Oven Standby Mode and Off Mode Power Use and for
Commercial Clothes Washers
III. General Discussion
A. Standby Power for Cooking Products
B. Test Procedures
C. Technological Feasibility
1. General
2. Gas Cooking Products--Alternatives to Line-Powered Electronic
Ignition Systems
3. Maximum Technologically Feasible Levels
D. Energy Savings
E. Economic Justification
1. Specific Criteria
a. Economic Impact on Consumers and Manufacturers
b. Life-Cycle Costs
c. Energy Savings
d. Lessening of Utility or Performance of Products
e. Impact of Any Lessening of Competition
f. Need of the Nation to Conserve Energy
2. Rebuttable Presumption
IV. Methodology and Discussion of Comments on Methodology
A. Market and Technology Assessment
1. Product Classes
2. Technology Options
3. Excluded Product Classes and Technologies
B. Engineering Analysis
1. Efficiency Levels
2. Manufacturing Costs
C. Life-Cycle Cost and Payback Period Analyses
1. Product Prices
2. Installation Cost
3. Annual Energy Consumption
4. Energy Prices
5. Repair and Maintenance Costs
6. Product Lifetime
7. Discount Rates
8. Effective Date of the Amended Standards
9. Product Energy Efficiency in the Base Case
10. Inputs to Payback Period Analysis
11. Rebuttable Presumption Payback Period
D. National Impact Analysis--National Energy Savings and Net
Present Value
1. General
2. Shipments
a. New Construction Shipments
b. Replacements
c. Purchase Price, Operating Cost, and Household Income Impacts
d. Fuel Switching
3. Other Inputs
a. Base-Case Forecasted Efficiencies
b. Standards-Case Forecasted Efficiencies
c. Annual Energy Consumption
d. Site-to-Source Conversion
e. Total Installed Costs and Operating Costs
f. Discount Rates
g. Effects of Standards on Energy Prices
E. Consumer Subgroup Analysis
F. Manufacturer Impact Analysis
G. Employment Impact Analysis
H. Utility Impact Analysis
I. Environmental Assessment
V. Discussion of Other Comments
A. Burdens and Benefits
1. Consideration of the Value of Avoided Environmental Impacts
B. Other Comments
1. Proposed Standards for Conventional Cooking Products
VI. Analytical Results and Conclusions
A. Trial Standard Levels
B. Significance of Energy Savings
C. Economic Justification
1. Economic Impact on Consumers
a. Life-Cycle Costs and Payback Period
b. Consumer Subgroup Analysis
2. Economic Impact on Manufacturers
[[Page 16041]]
a. Industry Cash-Flow Analysis Results
b. Impacts on Manufacturer Employment
c. Impacts on Manufacturers That Are Small Businesses
d. Cumulative Regulatory Burden
3. Net Present Value of Consumer Impacts and National Employment
Impacts
4. Impact on Utility or Performance of Products
5. Impact of Any Lessening of Competition
6. Need of the Nation To Conserve Energy
D. Conclusion
1. Overview
2. Conventional Cooking Products
3. Microwave Ovens
VII. Procedural Issues and Regulatory Review
A. Review Under Executive Order 12866
B. Review Under the Regulatory Flexibility Act
1. Reasons for the Final Rule
2. Objectives of, and Legal Basis for, the Rule
3. Description and Estimated Number of Small Entities Regulated
4. Description and Estimate of Compliance Requirements
5. Significant Issues Raised by Public Comments
6. Steps DOE Has Taken To Minimize the Economic Impact on Small
Manufacturers
C. Review Under the Paperwork Reduction Act
D. Review Under the National Environmental Policy Act
E. Review Under Executive Order 13132
F. Review Under Executive Order 12988
G. Review Under the Unfunded Mandates Reform Act of 1995
H. Review Under the Treasury and General Government
Appropriations Act, 1999
I. Review Under Executive Order 12630
J. Review Under the Treasury and General Government
Appropriations Act, 2001
K. Review Under Executive Order 13211
L. Review Under the Information Quality Bulletin for Peer Review
M. Congressional Notification
VIII. Approval of the Office of the Secretary
I. Summary of the Final Rule
A. The Standard Levels
DOE notes that this rulemaking originally bundled four separate
residential and commercial products (dishwashers, dehumidifiers,
electric and gas kitchen ranges and ovens and microwave ovens, and
commercial clothes washers). However, as explained in further detail
below, various events occurred during the course of the rulemaking
which resulted in the consideration of a number of these products
separately. For example, Congress set efficiency levels by statute for
dishwashers and dehumidifiers, which DOE codified in its regulations
through a separate rulemaking (along with numerous other statutory
changes). At the notice of proposed rulemaking (NOPR) stage, public
commenters made DOE aware of problems with the efficiency data for
certain commercial clothes washer models upon which DOE had relied in
its analyses. For microwave ovens, public commenters urged DOE to await
the impending finalization of the industry standard for measurement of
microwave oven standby mode and off mode power consumption before
adopting a corresponding DOE test procedure (a prerequisite for an
energy conservation standard addressing standby power). DOE believes
that both of these developments warrant further rulemaking action. For
these reasons, today's final rule is limited to addressing energy
conservation standards for the cooking efficiency of electric and gas
kitchen ranges and ovens and microwave ovens.
1. Statutorily Set Standard Levels for Dehumidifiers and Dishwashers
As explained in detail in the NOPR in this proceeding, the Energy
Policy and Conservation Act, as amended (42 U.S.C. 6291 et seq.; EPCA
or the Act), initially contained energy conservation standards for
dehumidifiers and residential dishwashers, as well as requirements for
DOE to amend those standards, and DOE announced it would consider such
amendments to those standards in this rulemaking. 73 FR 62034, 62036-40
(Oct. 17, 2008) (the October 2008 NOPR). However, the Energy
Independence and Security Act of 2007 (EISA 2007), Public Law No. 110-
40, subsequently amended these EPCA provisions in two ways pertinent
here. First, EISA 2007 prescribed efficiency standards for
dehumidifiers manufactured on or after October 1, 2012 and removed the
requirement for a rulemaking to amend the EPCA standards for this
product. Second, EISA 2007 prescribed maximum energy and water use
levels for residential dishwashers manufactured on or after January 1,
2010, and required completion of a final rule no later than January 1,
2015 to consider amendment of these dishwasher standards. 73 FR 62034,
62038-40 (Oct. 17, 2008). (EISA 2007, section 311(a)(1)-(2); 42 U.S.C.
6295(g)(10) and (cc)) DOE notes that although EISA 2007 did not
formally remove the requirement to conduct the current rulemaking, the
statutory standards for dishwashers are to become effective well before
the effective date of any amended standards that would have arisen from
the present rulemaking. Consequently, DOE has not conducted further
analysis in this rulemaking of standards for dehumidifiers and
residential dishwashers. 73 FR 62034, 62040 (Oct. 17, 2008). Instead,
DOE has incorporated into its regulations all of the energy
conservation standards prescribed by EISA 2007 for various products and
equipment, including those for dehumidifiers and residential
dishwashers, in a separate rulemaking notice. 74 FR 12058 (March 23,
2009).
2. The Standard Levels for the Energy Efficiency of Residential Cooking
Products
Pursuant to EPCA, any amended energy conservation standard that DOE
prescribes for cooking products \1\ or commercial clothes washers
(collectively referred to in this final rule as ``the two appliance
products'') must be designed to ``achieve the maximum improvement in
energy efficiency * * * which the Secretary determines is
technologically feasible and economically justified.'' (42 U.S.C.
6295(o)(2)(A) and 6316(a)) Furthermore, the new standard must ``result
in significant conservation of energy.'' (42 U.S.C. 6295(o)(3)(B) and
6316(a)) In today's final rule, DOE has decided to adopt amended energy
conservation standards pertaining to the cooking efficiency of
residential gas kitchen ranges and ovens pursuant to these criteria.
Today's final rule requires that residential gas kitchen ranges and
ovens without an electrical supply cord manufactured after April 9,
2012 must not be equipped with a constant burning pilot light. DOE has
decided not to adopt energy conservation standards pertaining to the
cooking efficiency of residential electric kitchen ranges and ovens and
microwave ovens. As explained in further detail below, no cooking
efficiency standards for these products were found to be
technologically feasible and economically justified.
---------------------------------------------------------------------------
\1\ The term ``cooking products'' as used in this notice refers
to residential electric and gas kitchen ranges and ovens, including
microwave ovens.
---------------------------------------------------------------------------
3. Further Rulemaking for Commercial Clothes Washers and Microwave
Ovens
DOE has decided to defer its decision regarding whether to adopt
amended energy conservation standards for the energy efficiency of
commercial clothes washers (CCWs) and for the standby mode and off mode
power consumption of microwave ovens, pending further rulemaking. The
reasons for DOE's decision are summarized below.
In the October 2008 NOPR, DOE tentatively concluded for CCWs that a
standard of 1.76 modified energy factor (MEF) and 8.3 water consumption
factor (WF) for top-loading CCWs and a standard of 2.0 MEF and 5.5 WF
for front-loading CCWs are technologically feasible and economically
justified. 73 FR 62034, 62036 (Oct. 17, 2008). As
[[Page 16042]]
discussed in more detail in section II.B.3, DOE received comments on
the October 2008 NOPR that questioned the validity of the maximum
technologically feasible (max-tech) level that was used in the analysis
of top-loading CCWs. DOE has concluded that additional information is
required to verify whether the max-tech level specified in the NOPR is
appropriate.
Likewise, the October 2008 NOPR tentatively concluded that a
standard for microwave oven standby mode and off mode energy
consumption would be technologically feasible and economically
justified. Therefore, concurrent with the standards NOPR, DOE published
in the Federal Register a test procedure NOPR for microwave ovens to
provide for the measurement of standby mode and off mode power
consumption by these products. 73 FR 61134 (Oct. 17, 2008). As
discussed in section II.B.3, DOE received comments on the October 2008
NOPR that objected to certain definitions that were included in the
proposed microwave oven test procedure amendments. The commenters
supported the incorporation of definitions provided in a revision of an
industry standard for measuring standby power consumption expected to
be completed later this year. DOE has concluded that it should defer
consideration of microwave oven energy conservation standards until the
revised industry standard becomes available for consideration in the
microwave oven test procedure amendments.
DOE intends to complete the rulemaking process for these products
and equipment as expected once additional key data and information
become available, keeping in mind the relevant statutory deadlines. As
discussed in the October 2008 NOPR, 73 FR 62034, 62041 (Oct. 17, 2008),
the EISA 2007 amendments to EPCA require DOE to amend the ranges and
ovens and microwave oven test procedure to incorporate standby and off
mode energy consumption no later than March 31, 2011. (42 U.S.C.
6295(gg)(2)(B)(vi)) For CCWs, EPCA requires that DOE issue a final rule
by January 1, 2010, to determine whether the existing energy
conservation standards should be amended. (42 U.S.C. 6313(e)(2)(A))
B. Current Federal Standards
DOE established the current energy conservation standards for
dishwashers manufactured on or after May 14, 1994, in a final rule
published in the Federal Register on May 14, 1991 (56 FR 22250). These
standards include a requirement that the energy factor (EF) of a
standard-size dishwasher must not be less than 0.46 cycles per
kilowatt-hour (kWh) and that the EF of a compact-size dishwasher must
not be less than 0.62 cycles per kWh. (10 CFR 430.32(f)) Section
311(a)(2) of EISA 2007 established maximum energy and water use levels
for dishwashers manufactured on or after January 1, 2010. (42 U.S.C.
6295(g)(10)) Under the amended statute, a standard-size dishwasher
shall not exceed 355 kWh/year and 6.5 gallons of water per cycle, and a
compact-size dishwasher shall not exceed 260 kWh/year and 4.5 gallons
of water per cycle.
EPCA, as amended by the Energy Policy Act of 2005 (EPACT 2005),
Public Law 109-58, prescribes the current energy conservation standard
for dehumidifiers, shown in Table I.1. (42 U.S.C. 6295(cc)(1); 10 CFR
430.32(v)) Section 311(a)(1) of EISA 2007 amended EPCA to prescribe
minimum efficiency levels for dehumidifiers manufactured on or after
October 1, 2012. (42 U.S.C. 6295(cc)(2))
Table I.1--Federal Standards for Residential Dehumidifiers
----------------------------------------------------------------------------------------------------------------
EPACT 2005 standards effective October 1, 2007 EISA 2007 standards effective October 1, 2012
----------------------------------------------------------------------------------------------------------------
Dehumidifier capacity pints/day EF liters/kWh Dehumidifier capacity pints/day EF liters/kWh
----------------------------------------------------------------------------------------------------------------
25.00 or less................................. 1.00 Up to 35.00..................... 1.35
25.01-35.00................................... 1.20 35.01-45.00..................... 1.50
35.01-54.00................................... 1.30 45.01-54.00..................... 1.60
54.01-74.99................................... 1.50 54.01-75.00..................... 1.70
75.00 or more................................. 2.25 Greater than 75.00.............. 2.5
----------------------------------------------------------------------------------------------------------------
EPCA prescribes the current energy conservation standard for
cooking products, which includes a requirement that gas ranges and
ovens with an electrical supply cord that are manufactured on or after
January 1, 1990, not be equipped with a constant burning pilot light.
(42 U.S.C. 6295(h)(1); 10 CFR 430.32(j)) Currently, no mandatory
Federal energy conservation standards exist for conventional electric
ranges and ovens or for microwave ovens.
EPCA also prescribes standards for CCWs manufactured on or after
January 1, 2007, requiring that CCWs have an MEF of at least 1.26 and a
WF of not more than 9.5. (42 U.S.C. 6313(e)(1); 10 CFR 431.156)
C. Benefits and Burdens to Purchasers of Cooking Products
In the October 2008 NOPR, DOE considered the impacts on consumers
of several trial standard levels (TSLs) related to the cooking
efficiency of conventional cooking products and microwave ovens. 73 FR
62034, 62037, 62084-90 (Oct. 17, 2008). In the October 2008 NOPR, DOE
tentatively concluded that none of the TSLs for microwave oven cooking
efficiency were economically justified. 73 FR 62034, 62119 (Oct. 17,
2008). DOE has reached the same conclusion in today's final rule.
Therefore, at this time, DOE is not adopting standards for microwave
oven cooking efficiency (EF), so there will be no positive or negative
impacts on purchasers of these products.
Also in the October 2008 NOPR, DOE determined that at TSL 1, the
economic impacts (i.e., the average life-cycle cost (LCC) savings) on
consumers of the proposed standards for conventional cooking products
would be positive. (TSL 1 prohibits constant burning pilots for gas
appliances but does not change standards for the other product
classes.) DOE has reached the same conclusion in today's final rule.
Table I.2 presents the impacts on consumers of the energy conservation
standards adopted in today's final rule.
[[Page 16043]]
Table I.2--Implications of Amended Standards for Consumers
------------------------------------------------------------------------
Gas cooktops Gas standard ovens
------------------------------------------------------------------------
New average installed cost.. $332................ $464.
Estimated installed cost $22................. $34.
increase.
Lifetime operating cost $37................. $43.
savings.
Average payback period...... 3.3 years........... 7.0 years.
------------------------------------------------------------------------
The typical baseline gas cooktop has an installed price of $310 and
an average lifetime operating cost of $561, resulting in a total life-
cycle cost of $871. To meet the new standards, DOE estimates that the
installed price of this product will be $332, an increase of $22. This
price increase will be offset by lifetime operating cost savings of
$37, resulting in life-cycle cost savings of $15. For gas standard
ovens, the typical baseline product has an installed price of $430 and
an annual average lifetime operating cost of $406, resulting in a total
life-cycle cost of $836. To meet the new standards, DOE estimates that
the installed price of this product will be $464, an increase of $34.
This price increase will be offset by lifetime operating cost savings
of $43, resulting in life-cycle cost savings of $9.
For the subgroup of consumers who do not have access to the
electrical grid or whose religious and cultural practices prohibit the
use of grid electricity, the amended standards would require use of
technologies (e.g., a battery-powered spark-ignition device) that have
not yet been certified to meet applicable safety standards. See 42
U.S.C. 6295(o)(2)(B)(i)(VII) and 10 CFR part 430, subpart C, appendix
A, sections 4(a)(4)(i) and (iv), and 5(b)(1) and (4). (See sections
III.C.2 and VI.D.2 of this notice for further discussion.) Based on its
research, DOE expects that certification of such technologies under
applicable safety standards will likely be completed when these
standards become effective.
D. Impact on Manufacturers
Using a real corporate discount rate of 7.2 percent, DOE estimates
the industry net present value (INPV) in 2006$ of the gas cooktop, gas
oven, and microwave oven industries to be $288 million, $469 million,
and $1.46 billion, respectively, in the absence of new or amended
standards. DOE estimates the impact of the cooking efficiency standards
adopted in today's final rule on the INPV of manufacturers of these
products to be between a 1.73-percent loss and a 4.11-percent loss (-$5
million to -$12 million) for gas cooktop manufacturers and between a
1.56-percent loss and a 2.10-percent loss (-$7 million to -$10 million)
for gas oven manufacturers. Because DOE is not adopting standards for
cooking efficiency of conventional electric cooking products or
microwave ovens (and because consideration of a standby mode and off
mode standard for microwave ovens has been deferred), this final rule
will have no net impact on manufacturers of these products.
Based on DOE's interviews with manufacturers of cooking products
and on comments received on the October 2008 NOPR, DOE determined that
two small businesses that manufacture gas cooking products could be
disproportionately affected by standards. (See section VII.B of this
notice for further discussion.)
E. National Benefits
DOE estimates the standards will save approximately 0.14 quads
(quadrillion (1015) British thermal units (BTU)) of energy
over 30 years (2012-2042). This is equivalent to 2.9 days of U.S.
gasoline use.
By 2042, DOE expects the energy savings from the standards to
eliminate the need for approximately 62 megawatts (MW) of generating
capacity.\2\ These energy savings will result in cumulative
(undiscounted) greenhouse gas emission reductions of approximately 13.7
million tons (Mt) of carbon dioxide (CO2). Based on a
methodology developed during 2008, these emission reductions were
estimated to represent domestic benefits of $0 to $109 million using a
7-percent discount rate and $0 to $241 million using a 3-percent
discount rate, cumulative from 2012 to 2042 in 2007$. The methodology
used to develop these estimates is now under review.
---------------------------------------------------------------------------
\2\ Because the amended standards affect solely residential gas
consumption, the installed power plant generating capacity change
represents only 0.005 percent of the total installed generating
capacity forecasted for the year 2030. Therefore, both the installed
capacity change and its associated emission reductions are
negligible. Although effectively negligible, installed generation
capacity and emission impacts are still reported in section VI of
today's final rule for TSL 1 (the amended standards).
---------------------------------------------------------------------------
Additionally, the standards will help alleviate air pollution by
resulting in approximately 6.1 kilotons (kt)) of nitrogen oxides
(NOX) cumulative emission reductions at the sites where
appliances are used from 2012 through 2042. In addition, the standards
would result in power plant NOX emissions reductions of 0.6
kt from 2012 to 2042. The total NOX emissions reductions at
these locations would be an amount equal to $0.7 to $7.3 million using
a 7-percent discount rate and $1.5 to $15.4 million using a 3-percent
discount rate, in 2006$. The standards would also possibly result in
power plant mercury (Hg) emissions reductions of up to 0.15 tons (t)
from 2012 to 2042, or an amount equal to $0 to $1.3 million using a 7-
percent discount rate and $0 to $2.6 million using a 3-percent discount
rate, in 2006$.
The national NPV of the standards is $254 million using a 7-percent
discount rate and $706 million using a 3-percent discount rate,
cumulative from 2012 to 2042 in 2006$. This is the estimated total
value of future savings minus the estimated increased equipment costs,
discounted to 2007.
The benefits and costs of today's final rule to the Nation can also
be expressed in terms of annualized [2006$] values over the forecast
period (2012 through 2042). Using a 7-percent discount rate for the
annualized cost analysis, the cost of the standards established in
today's final rule is $17 million per year in increased product and
installation costs, while the annualized benefits are $37 million per
year in reduced product operating costs. Using a 3-percent discount
rate, the cost of the standards established in today's final rule is
$28 million per year and the benefits are $85 million per year.
F. Conclusion
DOE has evaluated the benefits (energy savings, consumer LCC
savings, positive national NPV, and emissions reductions) to the Nation
of amended energy conservation standards for gas cooking products and
of new cooking efficiency standards for conventional electric cooking
products and microwave ovens, as well as the costs of such standards
(loss of manufacturer INPV and consumer LCC increases for some users of
the cooking products). Based on all available information, DOE has
determined that the benefits to the
[[Page 16044]]
Nation of the standards for gas cooking products outweigh their costs.
Today's standards also represent the maximum improvement in energy
efficiency that is technologically feasible and economically justified,
and will result in significant energy savings. At present, gas cooking
products that meet the amended standard levels are commercially
available or, for the subgroup of consumers without access to the
electrical grid or whose religious or cultural practices prohibit the
use of grid electricity, are likely to be commercially available at the
time the standards become effective.
II. Introduction
A. Authority
Title III of EPCA sets forth a variety of provisions designed to
improve energy efficiency. Part A \3\ of Title III (42 U.S.C. 6291-
6309) provides for the ``Energy Conservation Program for Consumer
Products Other Than Automobiles.'' The program covers consumer products
and certain commercial products (all of which are referred to hereafter
as ``covered products''), including electric and gas kitchen ranges and
ovens. (42 U.S.C. 6292(10), 6295(h)) Part A-1 \4\ of Title III (42
U.S.C. 6311-6317) establishes a similar program for ``Certain
Industrial Equipment'' (referred to hereafter as ``covered
equipment''), including commercial clothes washers. (42 U.S.C. 6312,
6313(e)) Part A of Title III provides for test procedures, labeling,
and energy conservation standards for residential cooking products and
certain other types of products, and it authorizes DOE to require
information and reports from manufacturers.
---------------------------------------------------------------------------
\3\ This part was originally titled Part B. It was redesignated
Part A in the United States Code for editorial reasons.
\4\ This part was originally titled Part C. It was redesignated
Part A-1 in the United States Code for editorial reasons.
---------------------------------------------------------------------------
The National Appliance Energy Conservation Act of 1987 (NAECA),
Pub. L. 100-12, amended EPCA to establish prescriptive standards for
cooking products. NAECA requires gas ranges and ovens with an
electrical supply cord that are manufactured on or after January 1,
1990, not to be equipped with a constant burning pilot light, and
requires DOE to conduct two cycles of rulemakings for ranges and ovens
to determine if the standards established should be amended. (42 U.S.C.
6295(h)(1)-(2)) The test procedures for cooking products appear at 10
CFR part 430, subpart B, appendix I.
DOE is conducting the present rulemaking for cooking products
pursuant to the authority set forth above. The following paragraphs
discuss some of the key provisions of EPCA relevant to the standards-
setting rulemaking.
EPCA provides criteria for prescribing new or amended standards for
covered products. As indicated above, any new or amended standard for
cooking products must be designed to achieve the maximum improvement in
energy efficiency that is technologically feasible and economically
justified. (42 U.S.C. 6295(o)(2)(A)) Additionally, DOE may not
prescribe an amended or new standard if DOE determines by rule that
such a standard would not result in ``significant conservation of
energy,'' or ``is not technologically feasible or economically
justified.'' (42 U.S.C. 6295(o)(3)(B) and 6316(a))
EPCA also provides that in deciding whether such a standard is
economically justified for covered products, DOE must, after receiving
comments on the proposed standard, determine whether the benefits of
the standard exceed its burdens by considering, to the greatest extent
practicable, the following seven factors:
1. The economic impact of the standard on manufacturers and
consumers of the products subject to the standard;
2. The savings in operating costs throughout the estimated average
life of products in the type (or class) compared to any increase in the
price, initial charges, or maintenance expenses for the covered
products that are likely to result from the imposition of the standard;
3. The total projected amount of energy savings likely to result
directly from the imposition of the standard;
4. Any lessening of the utility or the performance of the products
likely to result from the imposition of the standard;
5. The impact of any lessening of competition, as determined in
writing by the Attorney General, that is likely to result from the
imposition of the standard;
6. The need for national energy conservation; and
7. Other factors the Secretary of Energy (Secretary) considers
relevant. (42 U.S.C. 6295(o)(2)(B)(i) and 6316(a))
In addition, EPCA, as amended (42 U.S.C. 6295(o)(2)(B)(iii) and
6316(a)), establishes a rebuttable presumption that any standard for
covered products is economically justified if the Secretary finds that
``the additional cost to the consumer of purchasing a product complying
with an energy conservation standard level will be less than three
times the value of the energy (and as applicable, water) savings during
the first year that the consumer will receive as a result of the
standard,'' as calculated under the test procedure in place for that
standard.
EPCA also contains what is commonly known as an ``anti-
backsliding'' provision. (42 U.S.C. 6295(o)(1) and 6316(a)) This
provision mandates that the Secretary not prescribe any amended
standard that either increases the maximum allowable energy use or
decreases the minimum required energy efficiency of a covered product.
EPCA further provides that the Secretary may not prescribe an amended
or new standard if interested persons have established by a
preponderance of the evidence that the standard is ``likely to result
in the unavailability in the United States of any product type (or
class) of performance characteristics (including reliability),
features, sizes, capacities, and volumes that are substantially the
same as those generally available in the United States at the time of
the Secretary's finding.'' (42 U.S.C. 6295(o)(4) and 6316(a))
Section 325(q)(1) of EPCA is applicable to promulgating standards
for any type or class of covered product that has two or more
subcategories. (42 U.S.C. 6295(q)(1) and 6316(a)) Under this provision,
DOE must specify a different standard level than that which applies
generally to such type or class of product for any group of products
``which have the same function or intended use, if * * * products
within such group--(A) consume a different kind of energy from that
consumed by other covered products within such type (or class); or (B)
have a capacity or other performance-related feature which other
products within such type (or class) do not have and such feature
justifies a higher or lower standard'' than applies or will apply to
the other products. (42 U.S.C. 6295(q)(1)(A) and (B)) In determining
whether a performance-related feature justifies such a different
standard for a group of products, DOE must consider ``such factors as
the utility to the consumer of such a feature'' and other factors DOE
deems appropriate. (42 U.S.C. 6295(q)(1)) Any rule prescribing such a
standard must include an explanation of the basis on which DOE
established such higher or lower level. (See 42 U.S.C. 6295(q)(2)).
Federal energy conservation standards for covered products
generally supersede State laws or regulations concerning energy
conservation testing, labeling, and standards. (42 U.S.C. 6297(a)-(c)
and 6316(a)) DOE can, however, grant waivers of preemption for
particular State laws or regulations, in accordance with the procedures
and
[[Page 16045]]
other provisions of section 327(d) of the Act. (42 U.S.C. 6297(d) and
6316(a))
B. Background
1. Current Standards
As described in greater detail in the October 2008 NOPR, 73 FR
62034, 62039-40 (Oct. 17, 2008), the current energy conservation
standards in EPCA for dishwashers apply to all products manufactured on
or after May 14, 1994 (10 CFR 430.32(f)); for dehumidifiers, to all
products manufactured on or after October 1, 2007 (42 U.S.C.
6295(cc)(1); 10 CFR 430.32(v)); for cooking products, to all products
manufactured on or after January 1, 1990, (42 U.S.C. 6295(h)(1); 10 CFR
430.32(j)); and for CCWs to all equipment manufactured on or after
January 1, 2007 (42 U.S.C. 6313(e)(1); 10 CFR 431.156). In addition,
EISA 2007 established standards for dishwashers manufactured on or
after January 1, 2010 (42 U.S.C. 6295(g)(10)) and for dehumidifiers
manufactured on or after October 1, 2012 (42 U.S.C. 6295(cc)(2)). These
standards are discussed in section I.B.
2. History of Standards Rulemaking for the Two Appliance Products
As noted above, this rulemaking originally bundled four products
(dishwashers, dehumidifiers, residential cooking products, and
commercial clothes washers). However, during the course of this
rulemaking, Congress set energy conservation standard levels by statute
for dishwashers and dehumidifiers as part of EISA 2007. Accordingly,
the regulatory history provided below focuses on the two remaining
appliance products--residential cooking products and commercial clothes
washers.
NAECA amended EPCA to establish the current prescriptive standard
requiring gas ranges and ovens with an electrical supply cord not to be
equipped with a constant burning pilot light. (42 U.S.C. 6295(h)(1)) In
a rulemaking undertaken pursuant to EPCA (42 U.S.C. 6295(h)(2)), DOE
issued a final rule in which it found that standards were not justified
for electric cooking products and, partially due to the difficulty of
conclusively demonstrating the economic impacts of standards for gas-
fired ranges and ovens, did not include amended standards for gas-fired
ranges and ovens in the final rule. 63 FR 48038 (Sept. 8, 1998).
Section 136(a) and (e) of the Energy Policy Act of 2005 (EPACT
2005), Public Law 109-58, amended EPCA to add CCWs as covered
equipment, establish the current standards for such equipment, and
require that DOE do two cycles of rulemakings to determine whether
these standards should be amended. (42 U.S.C. 6311(1) and 6313(e)) DOE
has incorporated these standards into its regulations. 70 FR 60407,
60416 (Oct. 18, 2005); 10 CFR 431.156.
DOE commenced this rulemaking on March 15, 2006, by publishing its
framework document for the rulemaking, and then gave notice of a public
meeting and of the availability of the document. 71 FR 15059 (March 27,
2006). The framework document described the approaches DOE anticipated
using and issues to be resolved in the rulemaking. DOE held the public
meeting on April 27, 2006, to present the contents of the framework
document, describe the analyses DOE planned to conduct during the
rulemaking, obtain public comment on these subjects, and facilitate the
public's involvement in the rulemaking. DOE also allowed the submission
of written statements after the public meeting. In response, DOE
received 11 written statements.
On December 4, 2006, DOE posted two spreadsheet tools for this
rulemaking on its Web site. The tools included calculation of the
impacts of the candidate standard levels developed for the two
appliance products. One tool calculates LCC and payback periods (PBPs);
the other--the National Impact Analysis (NIA) Spreadsheet--calculates
shipments, national energy savings (NES), and NPV.
On November 15, 2007, DOE published an advance notice of proposed
rulemaking (ANOPR) in this proceeding. 72 FR 64432 (November 2007
ANOPR). In the November 2007 ANOPR, DOE described and sought comment on
the analytical framework, models, and tools that DOE was using to
analyze the impacts of energy conservation standards for the relevant
appliance products. In addition, DOE published on its Web site the
complete ANOPR technical support document (TSD), which included the
results of DOE's preliminary analyses in this rulemaking. In the
November 2007 ANOPR, DOE requested oral and written comments on these
preliminary results and on a range of other issues, including the
measurement of microwave oven standby power consumption and potential
CCW product classes. DOE held a public meeting in Washington, DC, on
December 13, 2007, to present the methodology and results of the ANOPR
analyses, and to receive oral comments from those who attended. The
oral and written comments DOE received focused on DOE's assumptions,
approach, and analytical results, and were addressed in detail in the
October 2008 NOPR.
In the October 2008 NOPR, DOE proposed new energy conservation
standards for the two appliance products. 73 FR 62034, 62134 (Oct. 17,
2008). It also provided additional background information on the
history of this rulemaking. Id. at 62040-41. In conjunction with the
October 2008 NOPR, DOE also published on its Web site the complete TSD
for the proposed rule, which incorporated the analyses DOE conducted
and technical documentation for each analysis. The LCC spreadsheets,
national impact analysis spreadsheets, Government Regulatory Impact
Model (GRIM) spreadsheets, and regulatory impact analysis (RIA)
spreadsheets are also available on DOE's Web site.\5\ The standards
proposed for the two appliance products are presented in Table II.1.
---------------------------------------------------------------------------
\5\ Available online at DOE's Web site: https://www1.eere.energy.gov/buildings/appliance_standards/residential/home_appl_analysis.html.
Table II.1--October 2008 Proposed Energy Efficiency Standards
----------------------------------------------------------------------------------------------------------------
Product class Proposed energy conservation standards
----------------------------------------------------------------------------------------------------------------
Kitchen ranges and ovens:
Gas cooktops/conventional burners.. No constant burning pilot lights.
Electric cooktops/low or high No standard.
wattage open (coil) elements.
Electric cooktops/smooth elements.. No standard.
Gas ovens/standard oven............ No constant burning pilot lights.
Gas ovens/self-clean oven.......... No change to existing standard.
Electric ovens..................... No standard.
[[Page 16046]]
Microwave ovens.................... Maximum standby power = 1.0 watt.
Commercial clothes washers:
Top-loading commercial clothes 1.76 Modified Energy Factor/8.3 Water Factor.
washers.
Front-loading commercial clothes 2.00 Modified Energy Factor/5.5 Water Factor.
washers.
----------------------------------------------------------------------------------------------------------------
In the October 2008 NOPR, DOE discussed and invited comment
specifically on the following topics: (1) The proposed standards for
residential gas kitchen ranges and ovens, microwave ovens, and CCWs, as
well as DOE's tentative conclusion that standards for residential
electric kitchen ranges and ovens other than microwave ovens and gas
self-cleaning ovens are not technologically feasible and economically
justified; (2) whether battery-powered spark ignition modules are a
viable alternative to standing pilots for manufacturers of gas ranges,
ovens, and cooktops; (3) the technical feasibility of incorporating
microwave oven cooking efficiency with standby mode and off mode power
into a single metric for the purpose of developing energy conservation
standards; (4) input and data regarding off mode power for microwave
ovens; (5) input and data on the utility provided by specific features
that contribute to microwave oven standby power, particularly display
technologies and cooking sensors that do not require standby power; (6)
input and data on control strategies available to allow manufacturers
to make design tradeoffs between incorporating standby-power-consuming
features such as displays or cooking sensors and including a function
to turn power off to these components during standby mode, as well as
on the viability and cost of microwave oven control board circuitry
that could accommodate transistors to switch off cooking sensors and
displays; (7) whether switching or similar modern power supplies can
operate successfully inside a microwave oven and the associated
efficiency impacts on standby power; (8) the selection of microwave
oven standby standard levels for the engineering analysis; (9) input
and data on the estimated incremental manufacturing costs, the assumed
approaches to achieve each standby level for microwave ovens, and
whether any intellectual property or patent infringement issues are
associated with the design options presented in the TSD to achieve each
standby level; (10) input and data on the estimated market share of
microwave ovens at different standby power consumption levels; (11) the
appropriateness of using other discount rates in addition to 7 percent
and 3 percent real to discount future emissions reductions; and (12)
the determination of the anticipated environmental impacts of the
proposed rule, particularly with respect to the methods for valuing the
expected carbon dioxide (CO2) and oxides of nitrogen
(NOX) emissions savings due to the proposed standards. 73 FR
62034, 62133 (Oct. 17, 2008).
In addition to these topics on which it requested comment
specifically, DOE addressed four topics in the October 2008 NOPR: (1)
The determination of product classes for both cooking products and
CCWs; (2) the adequacy of the residential clothes washer test procedure
for CCWs; (3) small business impacts of the proposed cooking products
standards; and (4) impacts of the proposed CCW standards on the
competitive landscape.
DOE held a public meeting in Washington, DC, on November 13, 2008,
to hear oral comments on and solicit information relevant to the
proposed rule.
3. Further Rulemaking To Consider Energy Conservation Standards for
Microwave Oven Standby Mode and Off Mode Power Use and for Commercial
Clothes Washers
Among the responses to the October 2008 NOPR, DOE received a number
of comments from interested parties that presented information and
arguments for continuing the rulemaking process to consider standards
for microwave oven standby mode and off mode power consumption, as well
as standards for CCWs. These comments and DOE's response are discussed
below.
Regarding microwave oven standby mode and off mode power
consumption, interested parties raised concerns over issues associated
with the concurrent microwave oven test procedure rulemaking. As
mentioned above and discussed in detail in section III.B of today's
notice, DOE proposed to amend the microwave oven (MWO) test procedure
to incorporate by reference specific clauses of International
Electrotechnical Commission (IEC) Standard 62301, Household electrical
appliances--Measurement of standby power. DOE would have adopted
definitions for ``standby mode'' and ``off mode'' in accordance with
the EISA 2007 amendments to EPCA. 73 FR 62134 (Oct. 17, 2008) (MWO test
procedure NOPR).
The Association of Home Appliance Manufacturers (AHAM) raised
concerns about the ``robustness'' of these proposed microwave oven test
procedure amendments, and supported continuing the microwave oven
energy conservation standards rulemaking to allow additional time for
DOE to collect data and to clarify the test procedure. (AHAM, No. 47 at
pp. 3 and 5) \6\ Whirlpool Corporation (Whirlpool) stated that DOE
could perform better data gathering and analysis for a microwave oven
standby power standard if DOE used the entire time until the EISA 2007
deadline of March 31, 2011 for a test procedure amendment to
incorporate measurement of standby mode and off mode power consumption.
Whirlpool and GE Consumer & Industrial (GE) requested that DOE halt the
current microwave oven energy conservation standards rulemaking and
work with industry to gather and analyze more comprehensive energy
performance data. (Whirlpool, No. 50 at pp. 1-2; GE, No. 48 at p. 2) GE
further stated that DOE's approach to standby mode and off mode power
consumption for microwave ovens could have important implications for
other covered products, and that the microwave oven energy conservation
standards rulemaking should be postponed to allow DOE to address
standby power issues for covered products either through negotiation or
through a rulemaking that considers how the definition of ``standby
power'' will affect all appliances, not just microwave ovens. (GE, No.
48 at p. 4)
---------------------------------------------------------------------------
\6\ A notation in the form ``AHAM, No. 47 at pp. 3 and 5''
identifies a written comment (1) made by AHAM; (2) recorded in
document number 47 that is filed in the docket of this rulemaking
(Docket No. EE-2006-STD-0127) and maintained in the Resource Room of
the Building Technologies Program; and (3) which appears on pages 3
and 5 of document number 47.
---------------------------------------------------------------------------
AHAM raised four other concerns about the proposed microwave oven
test procedure amendments: (1) Which microwave ovens are covered
products; (2) the incorporation of the EPCA
[[Page 16047]]
definitions for ``standby mode'' and ``off mode,'' which AHAM claims
are outdated; (3) the conditions for standby power testing; and (4) the
test period for measuring standby power. AHAM stated that there is
considerable confusion regarding the definition of microwave ovens as
covered products. DOE stated in the microwave oven test procedure NOPR
that the test procedure amendments would apply to microwave ovens for
which the primary source of heating energy is electromagnetic
(microwave) energy, including microwave ovens with or without browning
thermal elements designed for surface browning of food. The proposed
test procedure amendments would not cover combination ovens (i.e.,
ovens consisting of a single compartment in which microwave energy and
one or more other technologies, such as thermal or halogen cooking
elements or convection systems, contribute to cooking the food). 73 FR
62134, 62137 (Oct. 17, 2008). AHAM stated that it had been working to
set up negotiations on a microwave oven standby power standard, but
that confusion caused by DOE's definition of microwave ovens required
AHAM to cancel its efforts until the definition is clarified. (AHAM,
No. 47 at p. 3) Whirlpool concurred that the definition of microwave
ovens needs to be clarified. It claimed that DOE appears to be creating
a new product definition without properly engaging interested parties.
(Whirlpool, Public Meeting Transcript, No. 40.5 at p. 29; Whirlpool,
No. 50, at pp. 1-2) \7\
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\7\ A notation in the form ``Whirlpool, Public Meeting
Transcript, No. 40.5 at p. 29'' identifies an oral comment that DOE
received during the November 13, 2008, NOPR public meeting, was
recorded in the public meeting transcript in the docket for this
rulemaking (Docket No. EE-2006-STD-0127), and is maintained in the
Resource Room of the Building Technologies Program. This particular
notation refers to a comment (1) made by Whirlpool during the public
meeting; (2) recorded in document number 40.5, which is the public
meeting transcript that is filed in the docket of this rulemaking;
and (3) which appears on page 29 of document number 40.5.
---------------------------------------------------------------------------
The Appliance Standards Awareness Project (ASAP) commented that it
appreciates DOE accelerating development of the microwave oven test
procedure ahead of the EISA 2007 deadline of 2011 so that standby power
savings can be captured in this round of rulemaking for cooking
products. (ASAP, Public Meeting Transcript, No. 40.5 at p. 32)
Regarding definitions of ``standby mode'' and ``off mode,'' AHAM
and Whirlpool recognize that DOE is using the definitions provided
under the EISA 2007 amendments to EPCA, but stated that DOE should
consider IEC's recent work in developing the second edition of IEC
Standard 62301, particularly the clarifications of the definitions of
``standby mode'' and ``off mode.'' AHAM cited the case in which a
microwave oven would be plugged in and only energize a light-emitting
diode (LED) or some other indication that the unit is in ``off mode.''
AHAM commented that this would represent a different way for the
product to communicate with the consumer that might not be covered
under the proposed mode definitions. (AHAM, Public Meeting Transcript,
No. 40.5 at pp. 58-60; Whirlpool, Public Meeting Transcript, No. 40.5
at pp. 60-61) In contrast, ASAP stated that the EISA 2007 language
defining ``standby mode'' and ``off mode'' was reviewed and agreed to
by AHAM, and jointly recommended by AHAM and efficiency advocates to
Congress. Therefore, ASAP asserted that DOE has definitions that were
recommended by interested parties. (ASAP, Public Meeting Transcript,
No. 40.5 at p. 64)
In the November 2007 ANOPR, DOE proposed considering a single
product class for microwave ovens, encompassing microwave ovens with
and without browning (thermal) elements. This product class did not
include microwave ovens that incorporate convection systems. DOE stated
that it was unaware of any data evaluating the efficiency
characteristics of microwave ovens incorporating convection systems,
and sought comments and information that would help it evaluate the
performance of such products. 72 FR 64432, 64445, 64513 (Nov. 15,
2007). AHAM commented in response that the single product class should
be broken up into subcategories according to features that may be
different than when the standard was first put into effect. 73 FR
62034, 62049 (Oct. 17, 2008). However, in the October 2008 NOPR, DOE
concluded, based on data supplied by AHAM and its own testing, that no
features or utilities were uniquely correlated with efficiency that
would warrant defining multiple product classes for microwave ovens.
Id. Therefore, for the purposes of the NOPR analyses, DOE retained a
single product class for microwave ovens. No additional data or
information was submitted in response to the October 2008 NOPR that
would justify amending the definition of the microwave oven product
class.
DOE agrees with commenters that it is beneficial to harmonize,
where possible, its standards and test procedures with those of other
countries and international agencies, particularly in the area of
standby power. DOE recognizes that IEC Standard 62301 is an
internationally accepted test standard for the measurement of standby
power in residential appliances, and that it would be beneficial to
many manufacturers to be required to meet only a single standby power
standard because they produce microwave ovens for markets in multiple
countries. In considering a standby power standard for microwave ovens,
along with associated amendments to the microwave oven test procedure,
DOE proposed to incorporate language for definitions of ``active
mode,'' ``standby mode,'' and ``off mode'' as provided by the EISA 2007
amendments to EPCA. (42 U.S.C. 6295(gg)(1)(A)) However, in directing
DOE to amend its test procedures to address standby and off mode power
consumption, the EISA 2007 amendments to EPCA allow DOE to amend the
EPCA definitions of these modes, while requiring that DOE take ``into
consideration the most current versions'' of IEC Standard 62301 and IEC
Standard 62087. (42 U.S.C. 6295(gg)(1)(B) and (2)(A)) In light of these
statutory provisions and recognizing the benefits of harmonization, DOE
has decided to continue this rulemaking, as to microwave oven standby
power standards, until the second edition of IEC Standard 62301 is
finalized, which is expected to occur by July 2009. At such time, DOE
will consider further modifications to DOE's microwave oven test
procedure, particularly the ``standby mode'' and ``off mode''
definitions, and, on the basis of such amended test procedures, DOE
will analyze potential energy conservation standards for microwave oven
standby mode and off mode energy consumption. DOE invites data and
information that will allow it to further conduct the analysis for
standby and off mode power consumption of microwave ovens. DOE
anticipates issuing supplemental notices of proposed rulemaking
(SNOPRs) for microwave oven energy conservation standards and the
microwave oven test procedure in order to obtain public input on DOE's
updated proposals. As part of such SNOPRs, DOE will carefully consider
and address any microwave oven-related comments on the October 2008
NOPR that remain relevant.
For CCWs, interested parties raised questions at the November 13,
2008, NOPR public meeting and in written comments on the max-tech level
that DOE had identified in the October 2008 NOPR for top-loading units.
(See section III.C.3 of this notice for additional discussion of max-
tech levels.)
[[Page 16048]]
Specifically, at the public meeting, Alliance Laundry Systems
(Alliance) questioned the validity of the certification data for the
CCW model on which DOE based the max-tech level for top-loading
machines. Alliance recommended that DOE, at a minimum, test and confirm
the performance of the max-tech model before using it as the basis for
assessing technical feasibility for the proposed standards. (Alliance,
Public Meeting Transcript, No. 40.5 at pp. 90-92) GE responded that it
produces the model in question, and its internal testing confirms that
the model meets the max-tech level. (GE, No. 48 at pp. 4-5) GE and
Alliance agreed that there would not be consumer acceptance of the
technology required to achieve the max-tech level (i.e., whether CCWs
incorporating advanced controls in a lightweight, non-rugged platform
would be able to withstand the harsher usage in a laundromat or multi-
family housing setting compared to a residential installation). (GE,
Public Meeting Transcript, No. 40.5 at pp. 173-174; Alliance, Public
Meeting Transcript, No. 40.5 at p. 23; Alliance, No. 45 at p. 1;
Alliance, No. 45.1 at pp. 3, 7, 13) GE stated that it had received
anecdotal consumer questions on the water levels and clothing turnover
(i.e., rotation of the clothing from top to bottom in the wash basket)
during the cycle utilized by its CCW that meets the top-loading max-
tech level. According to GE, while this CCW has achieved the max-tech
level during actual use in the on-premises laundry segment,\8\ it has
not yet been justified as sustainable in commercial laundromats where
the units are subject to much tougher conditions, such as overloading.
(GE, No. 48 at p. 4)
---------------------------------------------------------------------------
\8\ This segment refers to commercial clothes washers that are
installed in multi-family housing.
---------------------------------------------------------------------------
The Multi-Housing Laundry Association (MLA) commented that there is
no acceptable CCW currently that can meet the top-loading max-tech
level presented in the October 2008 NOPR. According to MLA, previous
non-agitator CCWs that could achieve max-tech performance have had poor
load capacity, poor wash results, and high maintenance costs. MLA
believes that the only way to meet the max-tech requirements would be
to have either a cold water wash or such limited amounts of hot water
that the clothes would not be effectively cleaned. According to MLA, to
meet the max-tech requirements, water in the rinse cycle would be so
limited that some soils, detergents, and sand would not be removed.
(MLA, No. 49 at p. 4) ASAP stated that DOE's conclusion in the TSD on
the max-tech model (i.e., that all higher-efficiency residential
clothes washers are impeller-type or do not have traditional agitators)
is erroneous, commenting that there are agitator-type residential
clothes washers on the market today that perform at higher levels than
the CCW max-tech level that DOE has presented in the October 2008 NOPR.
(ASAP, Public Meeting Transcript, No. 40.5 at p. 203) Whirlpool
commented that the max-tech level cannot be achieved with the
technologies implemented on current CCW models, but it believes that
technology exists to develop such products by the time standards would
become effective. (Whirlpool, No. 50 at p. 3)
EPCA requires DOE to consider the max-tech level in the analysis of
efficiency levels for CCW energy conservation standards. (42 U.S.C.
6295(o)(2)(A) and 6316(a)) In the NOPR analysis, DOE determined that
the max-tech level for top-loading CCWs, which was analyzed as part of
TSL 3, is technologically feasible and economically justified. 73 FR
62034, 62122 (Oct. 17, 2008). However, the comments submitted by
Alliance in response to the October 2008 NOPR raised questions on the
validity of the max-tech level. (Alliance, Public Meeting Transcript,
No. 40.5 at pp. 90-92; Alliance, No. 45 at p. 1; Alliance, No. 45.1 at
pp. 4-5) In light of this uncertainty surrounding the performance of
the CCW model upon which the top-loading max-tech level was based, DOE
tested several units of that model. Preliminary results indicate that
the MEF and WF of these units are below and above, respectively, the
max-tech levels. Therefore, DOE has decided that it will continue the
CCW rulemaking to further evaluate what an appropriate max-tech level
should be for top-loading CCWs, and it will revise its analyses for
this product class as necessary. DOE anticipates issuing an SNOPR to
obtain public input on DOE's updated proposal regarding CCW standards.
As part of such SNOPR, DOE will carefully consider and address any CCW-
related comments on the October 2008 NOPR that remain relevant.
III. General Discussion
A. Standby Power for Cooking Products
An issue in this rulemaking has been whether DOE should consider
power use in the standby and off modes in adopting energy conservation
standards for cooking products. As discussed in greater detail in the
October 2008 NOPR,\9\ EISA 2007 amended EPCA to require that DOE
address standby mode and off mode energy consumption both in adopting
standards for all covered products (for final rules for new or amended
standards adopted after July 1, 2010), including residential ranges and
ovens and microwave ovens, and in test procedures for covered products
(by March 31, 2011, for cooking products). (42 U.S.C. 6295(gg)) As
noted above, these provisions are not yet operative as requirements for
residential cooking products. Id.
---------------------------------------------------------------------------
\9\ 73 FR 62034, 62041 (Oct. 17, 2008).
---------------------------------------------------------------------------
Nonetheless, DOE has examined in this rulemaking whether to
incorporate standby mode and off mode power consumption in its energy
conservation standards for residential cooking products. 73 FR 62034,
62041 (Oct. 17, 2008). Specifically, in the October 2008 NOPR, DOE
stated that it does not intend to pursue revision of its standards and
test procedures to include standby power use by conventional cooking
products at this time, because it lacks data indicating the potential
for