Energy Conservation Program: Certification, Compliance, and Enforcement for Consumer Products and Commercial and Industrial Equipment, 12422-12505 [2011-3146]

Agencies

• DEPARTMENT OF ENERGY

[Federal Register Volume 76, Number 44 (Monday, March 7, 2011)]
[Rules and Regulations]
[Pages 12422-12505]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-3146]



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Vol. 76

Monday,

No. 44

March 7, 2011

Part II





Department of Energy





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10 CFR Parts 429, 430 and 431



Energy Conservation Program: Certification, Compliance, and Enforcement 
for Consumer Products and Commercial and Industrial Equipment; Final 
Rule

Federal Register / Vol. 76 , No. 44 / Monday, March 7, 2011 / Rules 
and Regulations

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DEPARTMENT OF ENERGY

10 CFR Parts 429, 430 and 431

[Docket No. EERE-2010-BT-CE-0014]
RIN 1904-AC23


Energy Conservation Program: Certification, Compliance, and 
Enforcement for Consumer Products and Commercial and Industrial 
Equipment

AGENCY: Office of Energy Efficiency and Renewable Energy, Department of 
Energy.

ACTION: Final rule.

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SUMMARY: The U.S. Department of Energy (DOE or the ``Department'') is 
adopting revisions to its existing certification, compliance, and 
enforcement regulations for certain consumer products and commercial 
and industrial equipment covered under the Energy Policy and 
Conservation Act of 1975, as amended (EPCA or the ``Act''). These 
regulations provide for sampling plans used in determining compliance 
with existing standards, manufacturer submission of compliance 
statements and certification reports to DOE, maintenance of compliance 
records by manufacturers, and the availability of enforcement actions 
for improper certification or noncompliance with an applicable 
standard. Ultimately, the provisions being adopted in this final rule 
will allow DOE to enforce systematically the applicable energy and 
water conservation standards for covered products and covered equipment 
and provide for more accurate, comprehensive information about the 
energy and water use characteristics of products sold in the United 
States.

DATES: Effective Dates: The amendments to Parts 429 (except Sec. Sec.  
429.12 through 429.54), 430 (except Appendix A to Subpart B of Part 430 
and Appendix B to Subpart B of Part 430), and 431 are effective April 
6, 2011.
    The amendments to Sec. Sec.  429.12 through 429.54 are effective 
July 5, 2011.
    The amendments to Appendix A to Subpart B of Part 430 and Appendix 
B to Subpart B of Part 430 are effective November 28, 2011.
    The incorporation by reference of the standards listed in this rule 
is approved by the Director of the Federal Register as of April 6, 
2011.

ADDRESSES: This rulemaking can be identified by docket number EERE-
2010-BT-CE-0014 and/or Regulatory Identification Number (RIN) 1904-
AC23.
    Docket: For access to the docket to read background documents, or 
comments received, go to the Federal eRulemaking Portal at https://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Ms. Ashley Armstrong, 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: 202-586-6590. E-mail: 
Ashley.Armstrong@ee.doe.gov; and Ms. Laura Barhydt, U.S. Department of 
Energy, Office of the General Counsel, Forrestal Building, GC-32, 1000 
Independence Avenue, SW., Washington, DC 20585. Telephone: 202-287-
6122. E-mail: Laura.Barhydt@hq.doe.gov.

SUPPLEMENTARY INFORMATION: This final rule incorporates by reference 
into Part 429 the following industry standards:
     ANSI/AHAM DW-1-1992, American National Standard, Household 
Electric Dishwashers, approved February 6, 1992, IBR approved for Sec.  
429.19.
    Copies of ANSI/AHAM DW-1-1992 is available from the Association of 
Home Appliance Manufacturers, 1111 19th Street, NW., Suite 402, 
Washington, DC 20036, 202-872-5955, or go to https://www.aham.org.
     International Organization for Standardization (ISO)/
International Electrotechnical Commission, (``ISO/IEC 17025:2005(E)''), 
``General requirements for the competence of testing and calibration 
laboratories'', Second edition, May 15, 2005, IBR approved for Sec.  
429.104.
    Copies of ISO/IEC 17025:2005(E) are available from the 
International Standards Organziation1, ch. de la Voie-Creuse CP 56 CH-
1211 Geneva 20 Switzerland, telephone +41 22 749 01 11, or go to https://www.iso.org/iso.

Table of Contents

I. Authority and Background
II. Summary of the Final Rule
    A. Certification
    B. Enforcement Testing
    C. Reorganization
III. Discussion of Comments
    A. Annual Certification Requirement
    B. Revisions to Reporting Requirements
    1. Reporting Sample Size and Total Number of Tests Performed
    2. Reporting of Testing Data
    3. Reporting Use of an ARM/AEDM or Other Alternative Method of 
Rating
    4. Defining ``distribute in commerce''
    5. Product-Specific Revisions to Reporting Requirements
    C. Certifying Entities and Third-Party Representation
    D. Submission of Certification Reports
    E. New Basic Model Filing, Basic Model Concept, and Notice of 
Discontinuance
    1. New Model Filing and Basic Model Concept
    2. Basic Model Numbering
    3. Notice of Discontinuance
    F. Certification Testing, Generally
    G. Certification Testing Specific to Commercial HVAC and WH 
Equipment, Including the Use of AEDMs and VICPs
    H. Records Retention and Confidentiality
    1. Records Retention by Manufacturers
    2. Confidentiality of Information
    I. Enforcement Testing
    1. Initiation of an Enforcement Action
    2. Process Provided to Manufacturers During Enforcement Testing
    3. Test Notice
    4. Sampling for Enforcement Testing
    5. Testing Done for Other Agencies
    6. Test Unit Selection
    7. Testing at Manufacturer's Option
    8. Cost Allocation for Testing
    9. Third-Party Laboratory Requirements for Enforcement Testing
    10. Enforcement for Imports and Exports
    J. Adjudication
    1. Prohibited Acts
    2. Penalties
    3. Imposition of Additional Certification Testing Requirements 
as Remedy for Non-Compliance
    4. Compromise and Settlement
    K. Waivers
    L. Additional Product Specific Issues
    1. Entity Responsible for Certification and Compliance for Walk-
In Coolers or Freezers (WICFs)
    2. Basic Model Definition for Walk-In Coolers or Freezers 
(WICFs)
    3. Basic Model and Manufacturer Model Number Reporting for 
Distribution Transformers, WICFs, and External Power Supplies.
    M. Additional Issues for Which DOE Sought Comment in September 
2010 NOPR
    1. Verification Testing
    2. Voluntary Industry Certification Programs
    3. Certification, Compliance and Enforcement for Electric Motors
    4. Revisions to Sampling Plans for Certification Testing
IV. 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 Final Rule
    3. Description and Estimated Number of Small Entities Regulated
    4. Description and Estimate of Compliance Requirements
    5. Duplication, Overlap, and Conflict With Other Rules and 
Regulations
    6. Significant Alternatives to the Rule
    C. Review Under the Paperwork Reduction Act
    1. Description of the Requirements
    2. Method of Collection
    3. Data
    D. Review Under the National Environmental Policy Act
    E. Review Under Executive Order 13132

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    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
V. Approval of the Office of the Secretary

I. Authority and Background

    Title III of the Energy Policy and Conservation Act of 1975, as 
amended (``EPCA'' or, in context, ``the Act'') 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 National Energy 
Conservation Policy Act (NECPA), Public Law 95-619, amended EPCA to add 
Part A-1 of Title III, which established an energy conservation program 
for certain industrial equipment. (42 U.S.C. 6311-6317) \1\
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    \1\ For editorial reasons, Parts B (consumer products) and C 
(commercial equipment) of Title III of EPCA were re-designated as 
parts A and A-1, respectively, in the United States Code.
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    Sections 6299-6305, and 6316 of EPCA authorize DOE to enforce 
compliance with the energy and water conservation standards (all non-
product specific references herein referring to energy use and 
consumption include water use and consumption; all references to energy 
efficiency include water efficiency) established for certain consumer 
products and commercial equipment. (42 U.S.C. 6299-6305 (consumer 
products), 6316 (commercial equipment)) DOE has promulgated enforcement 
regulations that include specific certification and compliance 
requirements. See 10 CFR part 430, subpart F; 10 CFR 430.23-25; 10 CFR 
part 431, subparts B, J, K, S, T, U, and V.
    On September 16, 2010, the Department published in the Federal 
Register a Notice of Proposed Rulemaking regarding Certification, 
Compliance, and Enforcement for Consumer Products and Commercial and 
Industrial Equipment (September 2010 NOPR). 75 FR 56796. DOE 
subsequently published two correction notices, which addressed the 
public meeting date and an omission in the regulatory text. 75 FR 57410 
(September 21, 2010) and 75 FR 61361 (October 5, 2010), respectively. A 
public meeting was held in Washington, DC, on September 30, 2010. The 
comment period for written submissions was scheduled to close on 
October 18. In response to multiple requests, DOE extended the comment 
period to close on October 29, 2010.
    The September 2010 NOPR proposed to revise, consolidate and 
streamline the Department's existing certification, compliance, and 
enforcement regulations for certain consumer products and commercial 
and industrial equipment covered under EPCA.

II. Summary of the Final Rule

A. Certification

    Today's rule revises the Department's current certification 
regulations to ensure that the Department has the information it needs 
to ensure that regulated products sold in the United States comply with 
the law. Currently, manufacturers of covered consumer products and 
commercial and industrial equipment must certify, by means of a 
compliance statement and a certification report, that each basic model 
meets the applicable energy conservation, water conservation, and/or 
design standard before distributing it in commerce within the United 
States. See 10 CFR 430.62 (consumer products); 431.327 (metal halide 
lamp ballast) and 430.371 (certain commercial equipment). As proposed 
in the September 2010 NOPR, DOE is adopting an annual certification 
reporting requirement for all covered products and covered equipment. 
Additional details are discussed below. Such annual filings will 
provide DOE with comprehensive, up-to-date efficiency information about 
the regulated products sold in the United States at any given time--a 
necessary predicate to an effective enforcement program.
    DOE believes it is also appropriate to provide more transparency in 
the certification report itself. In the September 2010 NOPR, DOE 
proposed to expand the information submitted by manufacturers, 
including general requirements applicable to all products and product-
specific requirements. DOE also proposed to make clear that all non-
proprietary certification information will be considered public 
information. As a result of stakeholder comments, DOE made some 
modifications to the product-specific information it is collecting and 
the public disclosure of such information in the final rule. These 
changes are discussed in more detail below. By requiring additional 
relevant data that affects the energy or water efficiency of a product 
to be supplied in the certification report, DOE will be able to more 
effectively enforce compliance with the conservation standards.
    To provide manufacturers with sufficient time to transition to 
these new certification provisions, the effective date of the 
certification requirements is 120 days from the publication of the 
final rule in the Federal Register. Each basic model of covered product 
or covered equipment that has not previously been certified with the 
Department must be certified on or before July 5, 2011 using DOE's on-
line certification tool (i.e., the Compliance Certification Management 
System or CCMS) and the pre-formatted EXCEL templates. See https://www.regulations.doe.gov/ccms/ for additional information. For those 
basic models of covered products or covered equipment that have 
previously been certified with the Department, manufacturers are 
required to submit revised certification data pursuant to regulations 
being adopted as part of today's final rule in accordance with the 
annual report table in 10 CFR 429.12.

B. Enforcement Testing

    The Department is modifying its regulations for enforcement testing 
to allow the Department to enforce the Federal efficiency standards 
proactively and fairly based on the circumstances of each case. In 
particular, today's rule makes three revisions to DOE's approach to 
enforcement testing that, although relatively minor, will significantly 
improve the effectiveness of DOE's enforcement program. First, the 
Department is removing the current regulatory provision that requires 
DOE to receive a written complaint alleging a violation of the standard 
before it can perform enforcement testing to determine a model's 
compliance. EPCA affords DOE with broad enforcement discretion, and DOE 
must be able to exercise that discretion proactively to ensure 
compliance and deter violations effectively. Second, today's rule 
allows the Department to select units for enforcement testing from 
retail, distribution, or manufacturer sources, depending on the 
circumstances, to ensure enforcement test results that are as unbiased, 
accurate, and representative as possible. Finally, the Department 
recognizes that the current regulatory approach to enforcement 
testing--involving DOE selected units and third party testing--may be 
impracticable for low-volume, custom-built products or where adequate 
laboratory facilities are unavailable. Thus, today's rule adopts an 
alternative approach to enforcement testing in such exceptional cases--
allowing DOE-witnessed testing at the manufacturer's lab and/or reduced 
sample sizes--to permit effective enforcement testing without imposing 
unreasonable burdens on manufacturers.

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C. Reorganization

    With the exception of electric motors, in the September 2010 NOPR, 
DOE proposed to move all of the existing certification, compliance, and 
enforcement regulations currently scattered throughout parts 430 and 
431 to a new Part 429. DOE additionally proposed to consolidate similar 
provisions for both consumer products and commercial and industrial 
equipment.
    In response to DOE's proposed new structure, DOE received several 
comments from interested parties on its September 2010 NOPR, some of 
which were organizational in nature. For example, a comment submitted 
by the National Electrical Manufacturers Association (NEMA) suggested 
grouping all the regulations that were relevant to a single product in 
a discrete portion of Part 429. (NEMA, No. 85.1 at p. 2) In response to 
these comments, and to provide additional clarity to Part 429 
requirements, DOE has made the following changes to Part 429 in today's 
final rule:
     Consolidated general requirements into Subpart A.
     Consolidated all certification requirements into Subpart 
B, with the creation of product-specific sections for sampling plans 
and certification requirements. This is intended to simplify the 
presentation for manufacturers and others who need information on a 
single product. Also, each of the product-specific sections now 
specifies the relevant sampling equations to ensure certification 
requirements are clear;
     Added Appendix D to Subpart B which includes Student's t-
distribution values for one-tailed confidence level calculations for 
product certification;
     Reorganized Subpart C to distinguish between enforcement 
measures and verification measures; and
     Incorporated a variety of editorial changes addressing 
certification, sampling plans, and enforcement.
    DOE is adopting Part 429 in its entirety today and expects to 
integrate electric motors into this Part in a subsequent rulemaking.

III. Discussion of Comments

A. Annual Certification Requirement

    Existing certification requirements direct most manufacturers of 
covered consumer products and commercial and industrial equipment to 
certify, by means of a compliance statement and a certification report, 
that each basic model meets the applicable energy conservation, water 
conservation, and/or design standard before distributing it in commerce 
within the United States. See 10 CFR 430.62 (consumer products); 10 CFR 
431.36, 430.371 (commercial equipment). In the September 2010 NOPR, DOE 
proposed moving to an annual certification reporting requirement for 
each basic model of covered product and covered equipment. 
Additionally, DOE proposed an annual filing schedule based generally 
upon the Federal Trade Commission (FTC) schedule for similar product 
types subject to annual reporting under the FTC's Appliance Labeling 
Rule. For commercial and industrial equipment, DOE proposed to align 
similar equipment types with the FTC schedule for consumer products.
    Today's rule adopts a mandatory annual certification filing 
requirement (as opposed to an annual testing requirement) and sets out 
a reporting schedule aligned as closely as possible with the current 
FTC schedule for consumer products. Under DOE's self-certification 
enforcement framework, only products that have been certified to DOE by 
manufacturers as compliant with the applicable standards can be 
distributed in commerce in the United States. Annual filings will 
provide the Department with up-to-date and comprehensive efficiency 
information about regulated products sold in the United States--a 
necessary predicate to an effective enforcement program. Recognizing 
this, many commenters, including the Alliance for Water Efficiency 
(AWE), Underwriters Laboratories, Inc. (UL), Alliance Laundry Systems 
LLC (ALS), Northwest Energy Efficiency Alliance (NEEA), Earthjustice, 
and the Association of Home Appliance Manufacturers (AHAM), supported 
an annual filing requirement. (AWE, No. 38.1 at p. 3; UL, No. 60.1 at 
p. 1; ALS, No. 66.1 at p. 1; NEEA, No. 67.1 at p. 2; Earthjustice, 
Public Meeting Transcript, No. 103 at pp. 42-43; AHAM, No. 98.1 at p. 
4) As one commenter put it: ``Knowledge of what products are being 
distributed in commerce at any given time is the foundation of an 
effective certification and enforcement program. A one-time initial 
certification of compliance does not provide the needed level of 
knowledge.'' (NEEA, No. 67.1 at p. 2)
    A few commenters objected to the proposal, arguing that annual 
filing was not needed and would increase reporting burdens. The 
International Association of Plumbing and Mechanical Officials (IAPMO) 
and IAPMO R&T, for example, commented that the Department's existing 
certification requirements already provide sufficient assurance of 
compliance. (IAPMO, No. 36.1 at p. 1) Similarly, AO Smith opposed an 
annual certification requirement, commenting that such a requirement 
would unduly increase the level of reporting required by manufacturers. 
(AO Smith, No. 81.1 at p. 2) Although DOE recognizes that annual filing 
will increase the frequency with which manufactures must file reports, 
the record reflects that the increase in cost burden will be minimal. 
As NAMA explained, ``annual certification does not cause an extreme 
economic burden and harm.'' (NAMA, No. 72.1 at p. 2; See also Traulsen, 
No. 52.1, at p. 4 (``Annual certification should not be a major 
burden'')) DOE also believes that electronic reporting will reduce the 
burden of preparing certification reports. Accordingly, the Department 
believes that this minimal increase in cost burden is outweighed by the 
need to ensure that the Department and the public have accurate and 
comprehensive efficiency information. In addition, an annual filing 
establishes a set date for manufacturers to fulfill this reporting 
obligation, which should allow manufacturers to regularize their annual 
reporting practices, thereby lowering costs and enhancing compliance.
    Several commenters suggested that DOE should impose annual testing 
requirements in addition to the proposed annual filing requirement. In 
particular, UL, ALS, the Natural Resources Defense Council (NRDC) and 
Earthjustice commented that while they are in support of establishing 
an annual certification requirement, such a requirement should include 
mandatory re-testing to validate the annual certification submissions, 
rather than merely re-submission of the original test data. (UL, No. 
60.1 at p. 1; ALS, No. 66.1 at p. 2; NRDC, Public Meeting Transcript, 
No. 103 at p. 39; Earthjustice, Public Meeting Transcript, No. 103 at 
pp. 43-44) NRDC proposed regular recertification of basic models that 
would require new laboratory testing of currently produced models and 
not simply resubmission of old test data from the initial 
certification. NRDC stated that the frequency of such recertification 
should depend on product-specific factors as well as a production 
cycle, and whether there is any change in energy usage above a de 
minimus threshold. (NRDC, No. 39.1 at p. 2) Earthjustice further 
contended that since determining when a model has been modified can be 
very difficult, a re-testing, as opposed to a re-submission, 
requirement would help to alleviate this problem. (Earthjustice, Public 
Meeting Transcript, No. 103 at pp. 43-44)
    While DOE recognizes these commenters' call for additional testing

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after the initial certification to ensure continued compliance, the 
Department declines to adopt an annual testing requirement whereby 
manufacturers must annually re-test all certified products and 
equipment. As several commenters point out, such a requirement would 
impose considerable burdens on manufacturers. (See, e.g., AHAM, No. 
98.1 at p. 4; ALS, No. 66.1 at p. 2; Traulsen, No. 52.1 at p. 4) As 
AHAM further explains, requiring ``costly and time consuming'' annual 
re-certification testing ``would likely be detrimental to innovation,'' 
and ``might threaten the viability to small manufacturers.'' (AHAM, No. 
98.1 at p. 4.) AHAM also pointed out that in light of DOE's additional 
testing and industry verification programs, the benefit to consumers 
from manufacturers' retesting certified products would be minimal. DOE 
agrees that the burdens of such a requirement would likely outweigh the 
benefits and is not requiring any new or additional testing to be 
performed as part of the annual filing requirement. It is instead a 
yearly submission of the ratings for all models a manufacturer has in 
distribution in that year. As discussed below, DOE continues to 
consider approaches to verification testing that would require 
subsequent testing of previously certified products, without an across 
the board annual re-testing requirement.
    With regard to DOE's proposal in the September 2010 NOPR to align 
the annual certification reporting deadlines with the FTC's schedule, 
ALS, NEEA, IAMPO, the American Lighting Association (ALA), and AHAM 
submitted comments supporting harmonization with the FTC's reporting 
requirements. (ALS, No. 66.1 at p. 1; NEEA, No. 67.1 at p. 2; IAMPO, 
Public Meeting Transcript, No. 103 at p. 42; ALA, No. 97.1 at p. 1; 
AHAM, No. 98.1 at p. 4) Specifically, ALA commented that such 
consolidation of reporting requirements would improve the efficiency 
and reduce the cost of compliance. (ALA, No. 97.1 at p. 1) Delta Faucet 
submitted comments requesting that efforts be made to reduce the 
reporting burden and cost on manufacturers by combining the DOE and FTC 
reports into one template. (Delta Faucet, No. 94.1 at p. 2) Today's 
final rule consolidates the Department's certification reporting 
requirements with FTC's schedule only. DOE will continue to consider 
consolidating filings with the FTC or other government agencies in a 
future certification, compliance, and enforcement rulemaking.

B. Revisions to Reporting Requirements

    In the September 2010 NOPR, DOE proposed to revise what information 
must be submitted as a part of a certification filing for DOE to better 
enforce its conservation standards. Specifically, DOE proposed to 
standardize to the extent possible the basic information required for 
certification of all covered products and covered equipment, setting 
out the basic requirements for every certification filing, followed by 
product-specific information requirements. DOE also proposed to require 
manufacturers to submit information related to waivers, exemptions, and 
approved alternative rating methodologies along with their 
certification submissions as appropriate. Lastly, DOE proposed to 
expand the product-specific information it was collecting with respect 
to each of the covered products and covered equipment to help DOE 
better understand the underlying attributes of the basic model's 
efficiency that impact the testing and certification data.
    DOE generally received comments on the following issues related to 
its proposed revisions to the certification reporting requirements: (1) 
Reporting sample size and total number of tests performed; (2) 
reporting of testing data; (3) reporting use of an Alternate Rating 
Method (ARM)/Alternative Efficiency Determination Method (AEDM) or 
other alternative method of rating; (4) defining ``distribute in 
commerce''; (5) product-specific revisions to reporting requirements. 
With the exception of the requirement for reporting the total number of 
tests performed, DOE is adopting all of the revisions to its reporting 
requirements proposed in the September 2010 NOPR. A discussion of 
specific stakeholder comments on these issues is presented below.
1. Reporting Sample Size and Total Number of Tests Performed
    Under the rule adopted today, manufacturers must report the size of 
the sample tested, but need not report the number of tests performed. 
With regard to DOE's proposal to require annual reporting of sample 
size, DOE received comments in opposition from AHAM and NEEA. (AHAM, 
No. 98.1 at p. 4; NEEA, No. 67.1 at p. 6) NEEA argued that there are no 
compelling reasons to require submission of sampling plan information 
or data as part of certification. (NEEA, No. 67.1 at p. 6) The 
Department disagrees.
    For purposes of certification testing, the determination that a 
basic model complies with the applicable conservation standard must be 
based on the sampling procedures, which are now found, by product, in 
10 CFR Part 429. The sampling procedures provide that ``a sample of 
sufficient size shall be tested to insure [compliance].'' Unless the 
product-specific regulations specify otherwise, a minimum of two units 
must be tested to certify a basic model as compliant. This minimum is 
implicit in the requirement to calculate a mean--an average--which 
requires at least two values. Under no circumstances is a sample size 
of one (1) authorized. Manufacturers may need to test more than two 
samples depending on the variability of their sample. Therefore, the 
sample size can be an important element when evaluating the compliance 
of a basic model.
    Consequently, the Department believes it is still important to 
request information regarding the sample size used in calculating the 
certification values submitted to DOE. As DOE has previously found, see 
https://www.gc.energy.gov/documents/certification_samplingplan.pdf, 
there is a significant amount of confusion in this area and DOE has 
attempted to clarify the sampling provisions, while maintaining the 
same level of tolerances, in the final rule. Sample size information 
that is submitted with the certification report will allow the 
Department to better understand how manufacturers are calculating their 
certified values. In the event the Department requests the test data 
underlying certification, manufacturers must provide the test data for 
each sample. DOE strongly encourages manufacturers to maintain records 
that clearly distinguished between each sample using unique identifiers 
like serial numbers and that provide a clear summary of how the 
appropriate statistics were applied to generate the certified ratings.
    The September 2010 NOPR also proposed to require that manufacturers 
report the total number of tests per sample. AHAM, the Air-
Conditioning, Heating and Refrigeration Institute (AHRI) and ALS 
objected to reporting the total number of tests performed in the annual 
certification report. (AHAM, No. 98.1 at p. 4; AHRI, No. 91.1 at pp. 9-
10; ALS, No. 66.1 at p. 2) Specifically, AHAM commented that it failed 
to see how this information is necessary or useful to DOE. As the 
commenters suggest, this information may not be as helpful to 
understanding the certified values since the number of tests performed 
by unit can vary widely based upon a number of factors, including 
manufacturing practices and production lots. Therefore, DOE will not 
require the manufacturer to report the

[[Page 12426]]

total number of tests performed per sample. Manufacturers may not use 
multiple tests of a single unit as separate samples when applying the 
sampling procedures.
2. Reporting of Testing Data
    A number of commenters urged DOE to require that manufacturers 
report all test data for all covered products and equipment in support 
of the certified value reported to DOE. (See, e.g., NRDC, No. 80.1 at 
4) NEEA stated that it supports the submission of non-regulatory 
metrics data from which the metric is derived. (NEEA, No. 67.1 at p. 2) 
Several manufacturers, however, strongly opposed reporting test results 
as part of the annual certification requirement. (Traulsen, No. 52.1 at 
p. 4; ALS, No. 66.1 at p. 2; BSH, No. 89.1 at p. 4) Specifically, 
Traulsen noted that providing such detailed data would compromise its 
product designs and competitive advantage. (Traulsen, No. 52.1 at p. 4) 
ALS stated that such a requirement would necessitate a huge undertaking 
by DOE to manage the submission and recordkeeping of all data for all 
the covered products under DOE's charge. (ALS, No. 66.1 at p. 2)
    The Department did not propose in the September 2010 NOPR to 
require submission of test data in the certification report, and such a 
requirement is not part of this final rule. While the Department 
believes that test data is a key factor in helping the Department 
understand the certified rating, DOE does not believe it is necessary 
to collect test data from all manufacturers at this time. Instead, DOE 
is hoping that by expanding the certification data that the Department 
is collecting and providing additional clarity in the regulations as to 
the processes manufacturers must follow to determine the certified 
ratings DOE will be in a better position to understand the data 
underlying compliance. Although DOE is not mandating that manufacturers 
submit test data along with each certification report at this time, the 
Department's regulations continue to require manufacturers to retain 
test data records in an easily accessible format and provide them to 
the Department upon request.
3. Reporting Use of an ARM/AEDM or Other Alternative Method of Rating
    From the comments, it appears there is general support for 
requiring manufacturers to submit information related to waivers, 
exemptions, and approved alternative rating methodologies along with 
their certification submissions. (See, e.g., NEEA No. 67.1 at 3) NEEA, 
for example, strongly supported the requirement that manufacturers 
report this information as part of the certification process. GE Prolec 
Distribution Transformers (GE Prolec) commented that, due to high 
volume designs and volume variations, manufacturers that use an AEDM 
for certification should have to update the AEDM substantiation each 
year and include this in the annual recertification process. (GE 
Prolec, No. 95.1 at p. 4) ABB Inc (ABB) noted that there is no approval 
process for an AEDM and, as such, the requirement to include the 
approval date should be removed from the certification report. (ABB, 
No. 53.1 at pp. 11-12) Currently, the regulations provide for use of an 
alternative rating method only for residential central air conditioners 
and heat pumps, commercial heating, ventilation, air-conditioning, and 
water heating equipment (HVAC and WH), electric motors, and 
distribution transformers. While ABB is correct that certain products, 
such as commercial HVAC and WH equipment do not require approval of the 
AEDM before it is used, other products, like residential central air 
conditioners and heat pumps, do. Thus, these approvals are product-
specific. DOE has clarified this in the final rule, which states that 
the information should be submitted, if applicable. The product-
specific templates, which will be available for use with the new online 
submission system, will also be product-specific and consistent with 
DOE's regulations.
    DOE also believes that manufacturers need the ability to specify 
that they have not performed actual testing but have modeled or 
simulated testing through the use of an ARM or AEDM or have used an 
alternative testing method authorized through a test procedure waiver, 
as the certification report itself requires the manufacturer to certify 
that it has tested the model. Providing alternative rating or 
alternative testing information in the certification report allows the 
manufacturer to make a more accurate certification statement to the 
Department. Similarly, in order to make an accurate certification 
statement to the Department, a manufacturer needs to identify any basic 
model that is being certified in accordance with an exception to the 
applicable standard. Accordingly, DOE adopts this requirement in 
today's final rule to provide an accurate reflection of the test 
procedures or exceptions used as a basis for the certification.
4. Defining ``distribute in commerce''
    EPCA's standards and DOE's certification and compliance 
requirements apply to covered products and equipment that are 
``distribute[d] in commerce.'' A number of commenters requested that 
the Department adopt a definition of ``distribution in commerce'' in 
its regulations. Mitsubishi Electric & Electronics USA, Inc. (MEUS) 
stated its concern that the definition of ``introduction into 
commerce'' is so broad it requires manufacturers to certify before 
providing information to the distribution base. As a solution, MEUS 
recommended that DOE de-link certification with ``introduce into 
commerce.'' (MEUS, No. 86.1 at p. 5) Additionally, NEEA expressed its 
concern that the definition of ``distribute in commerce'' would require 
certification prior to a decision to actually market the product. 
(NEEA, Public Meeting Transcript No. 67.1 at p. 336) Traulsen commented 
that DOE should define ``distribution in commerce'' as a published 
price. (Traulsen, No. 52.1 at p. 4)
    EPCA defines ``distribute in commerce'' as ``to sell in commerce, 
to import, to introduce or deliver for introduction into commerce, or 
to hold for sale or distribution after introduction into commerce.'' 
(See 42 U.S.C. 6291 (16).) The Department recognizes that products may 
be imported for prototyping, research, field testing, or trade shows 
while the product is still being developed or before it may be 
available to the general public for a price. But the Department's 
interpretation of this term and the application of the statute's 
definition will necessarily depend on a particular manufacturer's 
production practices, business decisions, and the facts and 
circumstances of a particular case. Therefore, DOE is reluctant to 
dictate a single point in time for all manufacturers when the product 
development process stops and when distribution in commerce begins. As 
such, the Department declines to add a precise definition of 
``distribution in commerce'' into its regulations. Instead, in each 
case, DOE will look to a number of factors to determine whether a model 
of a regulated product has been ``distributed in commerce.'' Such 
factors will include the following:
     Whether units of the model have been sold or offered for 
sale in exchange for monetary compensation;
     Whether units have been included in marketing material 
made available to the public (e.g., on Web sites or in catalogs);
     Whether the manufacturer has distributed marketing 
material that includes a claim or statements regarding the product's 
efficiency;
     Whether a unit has been shown at trade show; and

[[Page 12427]]

     The number of units produced, distributed, imported, and/
or sold.
    A model must be certified to DOE as compliant with the applicable 
standard prior to distribution in commerce, but the exact point at 
which any particular model has, in fact, been distributed in commerce 
may vary considerably across product types and manufacturers.
5. Product-Specific Revisions to Reporting Requirements
    In the September 2010 NOPR, the Department proposed including 
reporting requirements for products that did not previously have to 
submit information, including those added to DOE's programs by the 
Energy Independence and Security Act of 2007. In addition, the 
Department sought comment on expanding its sampling plans for 
certification to ``features'' other than the regulatory metrics. As an 
example, DOE suggested that the actual storage volume of a residential 
water heater may be a metric that should be subject to sampling 
requirements.
    Today's rule extends the reporting requirements to all products 
regulated under EPCA, but does not impose sampling plans for features 
other than the regulatory metric. The Department's certification 
requirements are the foundation of DOE's compliance and enforcement 
framework and will be mandatory for all products regulated by EPCA.
    Commenters generally disagreed, however, with the approach of 
extending the sampling plans beyond the regulatory metrics. For 
example, AO Smith commented that DOE should only test products for 
values that are covered in the current regulations, such as energy 
efficiency. (AO Smith, No. 81.1 at p. 3) Similarly, Bradford White 
Corporation commented that adding sampling plans and tolerances for 
other features of products is redundant and burdensome. (BWC, No. 45.1 
at p. 2) While DOE is not adopting sampling plans for features other 
than the regulatory metrics at this time, DOE is expanding its product-
specific certification requirements to require this type of information 
in the certification report.
    DOE believes information about features that affect the energy-
efficiency of the product is essential for DOE to audit compliance and 
for consumers to make informed decisions about product purchases. In 
addition, DOE notes that manufacturers have this information on hand 
and typically provide it in their marketing materials, on their Web 
site, or to product retailers. DOE's current regulations already 
request this type of information for certain products and equipment and 
requiring this information in the certification report is consistent 
with DOE's adoption of a more uniform approach to certification. In 
some instances, product or equipment feature information is necessary 
to determine how to apply DOE's test procedures. Thus, DOE believes 
this type of information is essential to any verification testing and 
enforcement testing that may be conducted by the Department. To help 
interested parties identify the new product-specific information to be 
submitted in certification reports, DOE has included this on a product-
by-product basis throughout Part 429.

C. Certifying Entities and Third-Party Representation

    Current certification regulations allow either the manufacturer or 
private labeler to submit certification reports and compliance 
statements for each basic model. DOE proposed, in the September 2010 
NOPR, to require that manufacturers be solely responsible for 
submitting the certification reports to DOE. Under this proposal, the 
certification burden would be placed on the manufacturer, and not the 
private labeler, although the manufacturer would still have the option 
of electing to have its private labeler act as a third-party filer and 
submit the certification report on the manufacturer's behalf. With 
regard to third-party filers, DOE proposed in the September 2010 NOPR 
to make clear in its regulations that it may refuse to accept 
certification reports from a third party with a history of poor 
performance. A discussion of comments on this issue is below.
    In today's rule, DOE is adopting its proposed requirement that 
manufacturers be solely responsible for submitting certification 
reports, which would include manufacturer information, as well as 
private labeler information and/or brand information, where 
appropriate. AWE and BWC submitted comments supporting DOE's proposal 
to hold the manufacturer solely responsible for submitting 
certification reports to DOE. (AWE, No. 38.1 at p. 2; BWC, No. 45.1 at 
p. 2) The Department considered NEEA's suggestion that the party 
responsible for introducing the product into commerce in the U.S. 
should be responsible for certification, whether that is a 
manufacturer, third-party private labeler, or an importer. (NEEA, No. 
67.1 at p. 3) The Department notes that, pursuant to EPCA, an importer 
is a manufacturer and is included in DOE's proposal. While NEEA's 
suggestion has some conceptual appeal, the Department believes that 
such an approach would create confusion and be difficult to administer 
as it may be unclear who is the party responsible for introducing the 
product into commerce in a particular case. (See, e.g., above 
discussion regarding the definition of distribution in commerce.) 
Another commenter, the NEMA Motor & Generator Section, argued that DOE 
should continue to permit the private labeler to submit certification 
reports on electric motors as the information required is well known by 
the private labelers. (NEMA, No. 85.1 at p. 23) DOE believes that, in 
most cases, the manufacturer, rather than the private labeler, is one 
that tests a model and therefore is in the best position to provide 
certification information to the Department and to retain the 
underlying test data as required by the rules. DOE reiterates, however, 
that under today's rule, a manufacturer may elect to have its private 
labeler act as a third-party filer and submit the certification report 
on the manufacturer's behalf.
    Commenters generally supported DOE's proposal to continue to allow 
third parties to submit certification reports to DOE on behalf of the 
manufacturer, as long as the third party does not have a history of 
poor performance. (See, e.g., AHAM, No. 98.1 at p. 6; BWC, No. 45.1 at 
p. 3) The Department notes that although a manufacturer is ultimately 
responsible for submission of the certification reports to DOE, it is a 
criminal violation for third parties to make knowingly false statements 
to the government. AHAM and BSH suggest that DOE notify the 
manufacturer or private labeler when the third-party it has selected 
has not met DOE's requirements given that the manufacturer or private 
labeler is the party that bears the ultimate liability for the report. 
(AHAM, No. 98.1 at p. 6; BSH, No. 89.1 at p. 4) DOE agrees that 
manufacturers should be notified in such cases by the third-party 
certified barred from submitting on behalf of manufacturers. DOE may 
also publish on its Web site a list of third-party certifiers barred 
from submitting certification reports. Intertek, UL and Earthjustice 
requested that DOE provide more specificity regarding when DOE will 
deem a third-party submitter to have a history of poor performance. 
(Intertek, No. 88.1 at p. 2; UL, No. 60.1 at p. 2; Earthjustice, No. 
83.1 at p. 3) DOE clarifies that there is not a set of specific 
circumstances that must be met for a third-party certifier to have a 
history of poor performance. However, in each case, DOE will look at 
circumstances, such as the number of certification violations involving 
the

[[Page 12428]]

third party, including number of reoccurrences, the scope and type of 
the violations (e.g., was certain data missing or was there a failure 
to file altogether), the willingness of a third-party certifier to 
cooperate with DOE, and any corrective actions taken to prevent 
recurring problems.

D. Submission of Certification Reports

    In the September 2010 NOPR, DOE proposed to remove the certified 
mail and e-mail options for filing certification data that are 
currently allowed in DOE's regulations and make electronic submission 
of certification reports through the Compliance and Certification 
Management System (CCMS) found at https://www.regulations.doe.gov/ccms 
the sole method of submission. CCMS will have sample templates for all 
covered products and covered equipment available for manufacturers to 
use when submitting certification data to DOE.
    The Department received few comments on this issue, with the 
majority of commenters supporting the move to exclusive use of the CCMS 
for certification. Specifically, NEEA commented that the proposed move 
to electronic filing for certification will reduce manufacturer 
compliance burdens and should allow for consistency of filed data from 
one Federal agency to another (NEEA, No. 67.1 at p. 3). Similarly, GE 
Prolec supported the CCMS approach, but also noted that there is 
currently no CCMS template for distribution transformers. (GE Prolec, 
No. 95.1 at p. 11; Public Meeting Transcript, No. 103 at p. 143) GE 
Prolec requested that it be able to review and comment on a proposed 
template for distribution transformers before it is finalized. DOE 
received one comment from First Co. opposing the use of CCMS as the 
sole method of certification because it would take time and a 
significant amount of work for manufacturers. First Co. suggested that 
the new CCMS only filing requirement should not become effective prior 
to July 1, 2011, to allow a reasonable period of time before converting 
to an electronic-only filing system. (First Co., No. 76.1 at p. 2)
    DOE believes the availability of electronic filing through the CCMS 
system should reduce compliance burdens, streamline the process, and 
provide the Department with needed information in a standardized, more 
accessible form. This electronic filing system will also ensure that 
records are recorded in a permanent, systematic way and enable the 
Department to move towards a public, searchable database. Thus, in this 
final rule DOE removes the certified mail and e-mail options for filing 
certification data that are currently allowed in DOE's regulations. DOE 
notes that the CCMS requires users to apply to use the system by 
filling out a registration form, signing a compliance statement, and 
receiving a personal password. Due to the number of user requests the 
Department expects to receive by the compliance date of the 
certification requirements being adopted in today's final rule, DOE 
strongly encourages users to set-up their accounts well in advance of 
the deadline. In addition, the CCMS templates with the new requirements 
for all covered products and covered equipment should be online shortly 
after the publication of today's final rule. The Department also 
encourages manufacturers, to the extent possible, to fill out these 
templates in advance of the compliance date in case questions arise.

E. New Basic Model Filing, Basic Model Concept, and Notice of 
Discontinuance

1. New Model Filing and Basic Model Concept
    In addition to the new annual certification requirement discussed 
above, DOE's September 2010 NOPR retained the existing regulatory 
requirement that any new basic model be certified before distribution 
in commerce. The Department explained that this requirement would apply 
to newly manufactured and produced basic models, as well as models that 
have been modified in a way that decreases a model's efficiency or 
increases its consumption and thus constitutes a new basic model. In 
connection with this requirement, the Department solicited comments on 
whether, and if so how, the Department should clarify the basic model 
concept to better identify whether and how energy or water use 
characteristics of a product may vary across different models in a 
basic model group. The Department's current regulations provide 
product-specific basic model definitions, which typically state that 
models within the same basic model group have ``essentially identical'' 
energy or water use characteristics. 10 CFR 430.2; 431.62, 431.172, 
431.192, 431.202, 431.222, and 431.292. In the September 2010 NOPR, DOE 
asked how manufacturers determine that a particular model constitutes a 
new basic model, the difference in the energy use characteristics a 
typical change may have on a per product basis, and whether DOE should 
adopt a regulation requiring that a model be recertified as a new basic 
model if modifications impact the energy or water characteristics by a 
given de minimus percentage.
    In response to DOE's questions, several manufacturers provided 
detailed product and manufacturer-specific information as to how they 
determine and make changes to basic model groupings. (See, e.g., Rheem, 
No. 79.1 at pp. 1-3; First Co., No. 76.1 at p. 1) Others, like NRDC, 
urged DOE to adopt specific and stringent product-specific thresholds 
for increases in energy consumption or decreases in energy efficiency 
that must be deemed a new basic model. (See, e.g., NRDC, No. 80.1 at p. 
2)
    More generally, commenters recognized the importance of the basic 
model concept and sought additional clarification on the matter. (See, 
e.g., AHAM, No. 98.1 at pp. 2-3 (seeking ``clear and uniform rules'' 
for ``determining that a particular model constitutes a new basic 
model''); NRDC, No. 80.1 at pp. 2-3) Some commenters offered ideas for 
adopting a general definition of the basic model concept. Consumers 
Union, for example, urged DOE to establish that any differences in 
electrical and mechanical parts and any significant changes in 
functional volumes, capacity or water usage should be categorized as 
different basic models. (Consumers Union, No. 74.1 at p. 2) Along 
similar lines, NRDC suggested that DOE look to California's definition 
of `basic model'' as a model along with an additional requirement that 
products within a basic model have similar efficiency and energy 
performance. (NRDC No. 80.1 at p. 2) NEEA cited California's approach, 
but also recommended that DOE allow for conservative ratings and simply 
require that all models in a basic model grouping have the same 
certified efficiency rating, on the ground that manufacturers certify 
compliance with a minimum standard rather than a performance level. 
(NEEA, No. 67.1 at pp. 4-5)
    A number of manufacturers and trade associations urged DOE to allow 
manufacturers to rate their products conservatively, so long as the 
ratings are supported by the test results and comply with the 
applicable standard. As Rheem explained, conservative ratings ensure 
performance for consumers that is the same or better than the rating, 
while giving manufacturers ``the flexibility to address fluctuations in 
component pricing or availability without the added burden of re-rating 
an appliance for every change.'' (Rheem, No. 79.1 at p. 3) Whirlpool 
similarly noted that manufacturers may rate products conservatively 
``to allow for natural fluctuation in component

[[Page 12429]]

tolerances and similar unit-to-unit variances.'' (Whirlpool, No. 78.1 
at p. 1) Reflecting manufacturers' desire for flexibility, AHAM 
proposed that, rather than establishing de minimus percentages, DOE 
should require manufacturers to certify changes to a basic model as a 
new basic model ``when the test results no longer support the rated 
value,'' explaining that results support a rated value when they 
demonstrate higher energy efficiency or lower energy consumption than 
the rating. (AHAM, No. 98.1 at p. 3) AO Smith advocated for a 
requirement that basic models have the same critical components and 
control logic along with a de minimus percentage that reasonably 
compares to enforcement sampling provisions. (AO Smith, No. 81.1 at pp. 
1-2)
    Although all of these commenters expressed varying approaches to 
the basic model concept, there was general agreement that a 
modification to a model that would increase energy or water 
consumption--such that testing would no longer support the rated 
value--should constitute a new basic model that must be certified to 
DOE. (See, e.g., AHAM, No. 98.1 at pp. 2-3; NRDC, No. 80.1 at pp. 2-3) 
The existing regulations already require certification of a new basic 
model if a modification results in an increase in energy or water 
consumption beyond the rated amount, and DOE is retaining that 
requirement.
    DOE agrees with the comments that the `basic model' concept is 
fundamental to the conservation standards regulatory framework. It 
allows manufacturers to group like models for purposes of fulfilling 
the Department's certification requirements, thereby reducing the 
burden placed on manufacturers by streamlining the amount of testing 
they must do to rate the efficiencies of their products. At the same 
time, the basic model provides the relevant basis for Departmental 
enforcement actions, including determinations of non-compliance.
    Accordingly, to clarify the basic model concept, today's rule 
centralizes and aligns the existing product-specific basic model 
definitions in a general definition, which provides (with some 
exceptions noted in the regulatory text) that a basic model means ``all 
units of a given type of product (or class thereof) manufactured by one 
manufacturer, having the same primary energy source, and which have 
essentially identical electrical, physical, and functional (or 
hydraulic) characteristics that affect energy consumption, energy 
efficiency, water consumption, or water efficiency.'' Although in some 
cases, the language of this general definition differs slightly from 
the precise language of the product-specific definitions, DOE 
emphasizes that this clarification reflects DOE's intent to maintain 
the status quo until a future rulemaking. This change is intended to 
provide a single, uniform definition of the basic model using language 
that permits what the Department understands to be the current 
practice--the grouping together of individual models with essentially 
(but not necessarily exactly) identical energy or water efficiency 
characteristics.
    The Department is not, at this time, adopting threshold de minimus 
changes that would trigger the creation of a new basic model or 
otherwise establishing set criteria for what is meant by ``essentially 
identical'' characteristics. The record suggests that identifying 
specific percentages is a complicated matter, particularly given that 
there may be significant variations among manufacturers and products 
with respect to basic model groupings. Thus, the Department continues 
to review the bases for more precise, product-specific limitations on 
which models can be grouped together as a basic model. DOE hopes to 
address this in the next phase of the certification, compliance, and 
enforcement rulemaking and will take all of the comments in the record 
into account at that time. DOE understands that, in the meantime, 
today's rule will permit flexibility in determining how manufacturers 
choose to group individual models with essentially, but not exactly, 
identical energy or water efficiency characteristics. DOE encourages 
manufacturers to adopt a reasonable approach to basic model groupings 
and to certify as a single basic model individual models with only 
superficial differences, such as product finishes. Furthermore, the 
Department provides the following guidance on DOE's basic model 
certification and compliance obligations.
    First, all models identified in a certification report as being the 
same basic model must have the same certified efficiency rating. With 
this rulemaking, manufacturers may elect to group individual models 
into basic models at their discretion to the extent the models have 
essentially identical electrical, physical, and functional (or 
hydraulic) characteristics that affect energy efficiency, energy 
consumption, water consumption, or water efficiency. However, the rated 
efficiency certification and representations of all of the individual 
models represented by a given basic model must be the same. 
Additionally, if a manufacturer wishes to change the certified rating 
of a particular model, this change constitutes the creation of a new 
basic model that must be certified to the Department.
    Second, any individual model that is modified resulting in 
performance that is less efficient than the rated level when tested in 
accordance with the DOE test procedures in Parts 430 and 431 and the 
applicable sampling plans in Part 429 must be re-rated as a new basic 
model and certified to DOE. Certified ratings must be supported by 
tested values that are at least as efficient as the rating when the 
applicable sampling plans in Part 429 are applied.
    Third, manufacturers may rate models conservatively, meaning the 
tested performance of the model(s) must be at least as good as the 
certified rating, after applying the appropriate sampling plan. The 
sampling plans are designed to create conservative ratings, which 
ensures that consumers get--at a minimum--the efficiency indicated by 
the certified rating. In this final rule, DOE allows manufacturers to 
use conservative ratings beyond those provided by the sampling plans. 
If DOE determines that any individual model within a basic model does 
not meet an applicable conservation standard, however, all models 
within the basic model group will be deemed non-compliant. Thus, as 
NEEA explained ``the larger the basic model group, the larger the risk 
associated with a compliance failure.'' (NEEA, No. 67.1 at p. 5)
    Finally, under the certification requirements adopted today, unless 
otherwise specified, manufacturers must identify in their certification 
reports the individual models that are included in each basic model. 
The Department's approach to certification, compliance, and enforcement 
depends on DOE having information about which individual models are 
covered by a given basic model.
2. Basic Model Numbering
    In the September 2010 NOPR, DOE proposed that manufacturers must 
designate a new basic model number when an existing model is modified 
such that a new basic model is created to permit transparency and 
improve consumer awareness. Several commenters, including AHAM, NEEA, 
Whirlpool, and ALS, expressed support for DOE's proposal to require a 
new number for a new basic model so long as a new basic model is 
created only when test results no longer support the rated value. (See, 
e.g., ALS, No. 66.1 at p. 1; Whirlpool, No. 78.1 at pp. 1-2; AHAM, No. 
98.1 at p. 3; NEEA, No. 67.1 at p. 5) A number of manufacturers, 
however, objected to the new basic

[[Page 12430]]

model number requirement as costly, administratively burdensome, and 
disruptive to the marketplace. (See, e.g., Traulsen, No. 52.1 at p. 1 
(estimating a 25% increase in marketing costs); Delta, No. 94.1 at p. 1 
(describing increased burden from updating literature, advertising 
materials, and installation instructions); and AO Smith, No. 81.1 at p. 
1 (emphasizing the stress to their customers from model number 
changes))
    In light of these comments, the Department will not require a new 
basic model number when a manufacturer creates a new basic model unless 
DOE has determined that the basic model is non-compliant with the 
standard. If manufacturers--on their own--seek to certify a new basic 
model, DOE will not require that they designate new model numbers to 
avoid unnecessary advertising, marketing, and consumer related costs. 
But, should DOE determine that a basic model does not comply with the 
applicable standard, manufacturers cannot certify any of the model 
numbers included in that basic model using the same model numbers 
certified in the basic model determined noncompliant. If, for example, 
a manufacturer wishes to make changes to a noncompliant basic model to 
bring it into compliance, that modified model(s) must be recertified as 
a new basic model, with a new model number(s). See 10 CFR 429.114(d). 
We reiterate that, in such cases, the Department is not requiring any 
particular numbering system or convention, only that it has a new basic 
model number to distinguish it from the noncompliant basic model. The 
Department believes that new model numbers are warranted in such cases 
to prevent consumer confusion and permit the Department to monitor 
compliance effectively.
    We note that designating new model numbers for a new basic model 
may be prudent in some circumstances even when it is not required by 
today's rule. DOE enforcement efforts will be based on the basic model 
number. A manufacturer that increases the efficiency of a model may 
elect not to recertify it using a new basic model number. If, however, 
DOE tests an earlier-manufactured unit and determines the basic model 
to be non-compliant with the standard, the manufacturer will be 
required to cease distribution of all units of all models listed under 
that basic model number, even if modifications to the model may have 
made it compliant over time. Furthermore, we note, as Whirlpool's 
comment points out, that the FTC has issued a staff opinion stating 
that the failure to change model numbers when changing the efficiency 
rating of a product may be considered an unfair and deceptive practice 
in violation of Federal law. (Whirlpool, No. 78.1, at p. 2 (attaching 
FTC staff opinion letter))
3. Notice of Discontinuance
    In the September 2010 NOPR, the Department proposed to require that 
manufacturers report a model as discontinued as a part of their annual 
filing following the date on which production of a model has ceased and 
it is no longer being sold or offered for sale by the manufacturer or 
private labeler. Several commenters sought additional clarity with 
respect to when a model has been discontinued. AHRI members, such as 
Daikin AC, urged DOE to adopt AHRI's approach, whereby models are 
discontinued when production has stopped, yet stock remains, and such 
models remain listed in AHRI's directory for 6 months. (See, e.g., 
Daikin AC, No. 73.1 at p. 1) Other commenters argued that 
discontinuance should be defined with respect to when production has 
ceased and should not refer to commerce. (See, e.g., BSH Home 
Appliance, No. 89.1 at p. 2; AHAM, No. 98.1 at p. 7) And one commenter 
suggested that DOE should simply remove all requirements for reporting 
discontinued models to DOE. (See ABB, No 53.1 at p. 8)
    Today's rule retains the requirement that manufacturers or 
certifying parties (i.e., third-party filers acting on behalf of a 
manufacturer) notify DOE in their annual certification filing when a 
model is no longer being produced and the manufacturer or private 
labeler is no longer offering it for sale. EPCA obligates DOE to ensure 
that all covered products distributed by manufacturers and private 
labelers in U.S. commerce comply with applicable Federal conservation 
standards. The r