Energy Conservation Program for Certain Industrial Equipment: Energy Conservation Standards for Commercial Warm Air Furnaces, 25627-25635 [2013-10388]
Download as PDF
Federal Register / Vol. 78, No. 85 / Thursday, May 2, 2013 / Proposed Rules
DEPARTMENT OF ENERGY
10 CFR Part 431
[Docket Number EERE–2013–BT–STD–
0021]
Energy Conservation Program for
Certain Industrial Equipment: Energy
Conservation Standards for
Commercial Warm Air Furnaces
Office of Energy Efficiency and
Renewable Energy, Department of
Energy.
ACTION: Request for information (RFI).
mstockstill on DSK4VPTVN1PROD with PROPOSALS
AGENCY:
SUMMARY: The U.S. Department of
Energy (DOE) is initiating a rulemaking
to consider amended energy
conservation standards for commercial
warm air furnaces. Once completed, this
rulemaking will fulfill DOE’s statutory
obligation by December 31, 2013 to
either propose amended energy
conservation standards for warm air
furnaces or to make a determination that
the existing standards do not need to be
amended. This notice seeks to solicit
information to assist DOE in
determining whether national standards
more stringent than those that are
currently in place would result in a
significant amount of additional energy
savings and whether such amended
national standards would be
technologically feasible and
economically justified. In overview, this
document presents a brief description of
the analysis DOE plans to perform for
this rulemaking and requests comment
on various issues relating to each of the
analyses (e.g., market assessment,
engineering analysis, energy use
analysis, life-cycle cost and payback
period analysis, and national impact
analysis). Although this document
contains numerous specific topics on
which the Department is particularly
interested in receiving written
comment, DOE welcomes views and
information from the public on any
subject within the scope of this
rulemaking (including relevant matters
not specifically raised in this RFI).
DATES: Written comments and
information are requested on or before
June 3, 2013.
ADDRESSES: Interested parties are
encouraged to submit comments
electronically. However, interested
persons may submit comments,
identified by docket number EERE–
2013–BT–STD–0021, or by any of the
following methods:
• Federal eRulemaking Portal:
www.regulations.gov. Follow the
instructions for submitting comments.
• Email: CommWarmAirFurn
2013STD0021@ee.doe.gov. Include
VerDate Mar<15>2010
16:43 May 01, 2013
Jkt 229001
docket number EERE–2013–BT–STD–
0021 in the subject line of the message.
Submit electronic comments in
WordPerfect, Microsoft Word, PDF, or
ASCII file format, and avoid the use of
special characters or any form of
encryption.
• Postal Mail: Ms. Brenda Edwards,
U.S. Department of Energy, Building
Technologies Program, Mailstop EE–2J,
1000 Independence Avenue SW.,
Washington, DC 20585–0121. If
possible, please submit all items on a
compact disc (CD), in which case it is
not necessary to include printed copies.
• Hand Delivery/Courier: Ms. Brenda
Edwards, U.S. Department of Energy,
Building Technologies Program, 6th
Floor, 950 L’Enfant Plaza SW.,
Washington, DC 20024. Telephone:
(202) 586–2945. If possible, please
submit all items on a CD, in which case
it is not necessary to include printed
copies.
For detailed instructions on
submitting comments and additional
information on the rulemaking process,
see section III of this document (Public
Participation).
FOR FURTHER INFORMATION CONTACT:
Requests for additional information may
be sent to Mr. John Cymbalsky, 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) 286–1692. Email:
commercial_furnaces@ee.doe.gov.
Mr. Eric Stas, U.S. Department of
Energy, Office of the General Counsel,
GC–71, 1000 Independence Avenue
SW., Washington, DC 20585–0121.
Telephone: (202) 586–9507. Email:
Eric.Stas@hq.doe.gov.
For information on how to submit or
review public comments, contact Ms.
Brenda Edwards, U.S. Department of
Energy, Office of Energy Efficiency and
Renewable Energy, Building
Technologies Program, Mailstop EE–2J,
1000 Independence Avenue SW.,
Washington, DC 20585–0121.
Telephone: (202) 586–2945. Email:
Brenda.Edwards@ee.doe.gov.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Introduction
A. Authority
B. Background
C. Rulemaking Process
II. Planned Rulemaking Analyses
A. Market Assessment
1. Potential New Product Classes
a. Weatherized and Non-Weatherized
Commercial Furnaces
b. Three-Phase Equipment With an Input
Capacity Less Than 225,000 Btu/h
B. Engineering Analysis
PO 00000
Frm 00008
Fmt 4702
Sfmt 4702
25627
1. Condensing Weatherized Commercial
Warm Air Furnaces
C. Markups Analysis
D. Energy Use Analysis
E. Life-Cycle Cost and Payback Period
Analysis
F. Shipment Analysis
G. National Impact Analysis
III. Public Participation
I. Introduction
A. Authority
Title III, Part C 1 of the Energy Policy
and Conservation Act of 1975 (EPCA or
the Act), Public Law 94–163 (42 U.S.C.
6311–6317, as codified), added by
Public Law 95–619, Title IV, § 441(a),
established the Energy Conservation
Program for Certain Industrial
Equipment, which includes provisions
covering the commercial warm air
furnace equipment that is the subject of
this notice.2 In general, this program
addresses the energy efficiency of
certain types of commercial and
industrial equipment. Relevant
provisions of the Act specifically
include definitions (42 U.S.C. 6311),
energy conservation standards (42
U.S.C. 6313), test procedures (42 U.S.C.
6314), labelling provisions (42 U.S.C.
6315), and the authority to require
information and reports from
manufacturers (42 U.S.C. 6316).
The initial Federal energy
conservation standards for commercial
warm air furnaces were added to EPCA
by the Energy Policy Act of 1992
(EPACT 1992), Public Law 102–486. (42
U.S.C. 6313(a)(4)) These types of
covered equipment have a rated
capacity (rated maximum input) greater
than or equal to 225,000 Btu/h, can be
gas-fired or oil-fired, and are designed to
heat commercial buildings. Id.
Section 5(b) of the American Energy
Manufacturing Technical Corrections
Act (AEMTCA), Public Law 112–210
(Dec. 18, 2012), amended EPCA to
include a requirement for DOE to
consider amending the standards for
certain types of commercial and
industrial equipment 3 every six years,
as well as a mandate that DOE must
conduct an expedited rulemaking to
consider amended energy conservation
standards for any covered equipment of
1 For editorial reasons, upon codification in the
U.S. Code, Part C was re-designated Part A–1.
2 All references to EPCA in this document refer
to the statute as amended through the American
Energy Manufacturing Technical Corrections Act,
Public Law 112–210 (Dec. 18, 2012).
3 These equipment types include small, large, and
very large commercial package air-conditioning and
heating equipment, packaged terminal air
conditioners and heat pumps, warm air furnaces,
packaged boilers, storage water heaters,
instantaneous water heaters, or unfired hot water
storage tanks (‘‘ASHRAE equipment’’).
E:\FR\FM\02MYP1.SGM
02MYP1
mstockstill on DSK4VPTVN1PROD with PROPOSALS
25628
Federal Register / Vol. 78, No. 85 / Thursday, May 2, 2013 / Proposed Rules
those types for which more than 6 years
has elapsed since the issuance of the
most recent final rule establishing or
amending a standard for the product as
of the date of AEMTCA’s enactment
(i.e., December 18, 2012). (42 U.S.C.
6313(a)(6)(C)(i) and (vi) 4) In general,
when conducting such a review, DOE
must publish either: (1) a notice of
determination that the current standards
do not need to be amended, or (2) a
notice of proposed rulemaking
containing proposed standards;
however, for those types of equipment
for which more than six years has
passed since the last final rule, Congress
also set a deadline of December 31, 2013
for publication of the determination/
proposed rule. Id.
In order to meet the new requirements
added by AEMTCA, DOE has begun to
review its existing energy conservation
standards for those equipment types
listed in 42 U.S.C. 6313(a) for which at
least six years have elapsed since
issuance of the most recent final rule,
including the commercial warm air
furnaces that are the subject of this
notice.
Today’s notice represents the
initiation of the mandatory review
process required by AEMTCA and seeks
input from the public to assist DOE with
its evaluation of whether to amend the
current Federal energy conservation
standards for commercial warm air
furnaces. In making this determination,
DOE must evaluate whether there is
clear and convincing evidence that
more-stringent national standards
would result in significant additional
energy savings, and be technologically
feasible and economically justified. (42
U.S.C. 6313(a)(6)(A)(ii)(II)) In
determining whether an amended
energy conservation standard is
economically justified, the Secretary
shall, after receiving views and
comments furnished with respect to a
proposed standard, determine whether
the benefits of the standard exceed the
burden of the proposed standard by, to
the maximum extent practicable,
considering the following seven factors:
(1) The economic impact of the
standard on the manufacturers and on
the consumers of the products subject to
the standard;
(2) The savings in operating costs
throughout the estimated average life of
the product in the type (or class)
compared to any increase in the price
of, or in the initial charges for, or
maintenance expenses of, the products
4 It is noted the AEMTCA inadvertently assigned
two separate provisions to 42 U.S.C.
6313(a)(6)(C)(vi). The provision cited above is the
one most relevant to this RFI.
VerDate Mar<15>2010
16:43 May 01, 2013
Jkt 229001
that are likely to result from the
standard;
(3) The total projected quantity of
energy savings likely to result directly
from the standard;
(4) Any lessening of the utility or the
performance of the products likely to
result from 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 standard;
(6) The need for national energy
conservation; and
(7) Other factors the Secretary
considers relevant.
(42 U.S.C. 6313(a)(6)(B)(ii))
EPCA, as codified, also contains what
is known as an ‘‘anti-backsliding’’
provision, which prevents the Secretary
from prescribing any amended standard
that either increases the maximum
allowable energy use or decreases the
minimum required energy efficiency of
a covered product. (42 U.S.C.
6295(o)(1)) Also, 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 covered 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. (42 U.S.C. 6295(o)(4))
Further, EPCA, as codified,
establishes a rebuttable presumption
that a standard is economically justified
if the Secretary finds that the additional
cost to the customer 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 applicable test
procedure. (42 U.S.C. 6295(o)(2)(B)(iii))
Additionally, when a type or class of
covered equipment has two or more
subcategories, DOE often specifies more
than one standard level. DOE generally
will adopt a different standard level
than that which applies generally to
such type or class of products for any
group of covered products that have the
same function or intended use if DOE
determines that 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 which justifies a higher or
lower standard. (42 U.S.C. 6295(q)(1)) In
PO 00000
Frm 00009
Fmt 4702
Sfmt 4702
determining whether a performancerelated feature justifies a different
standard for a group of products, DOE
generally considers such factors as the
utility to the customer of the feature and
other factors DOE deems appropriate. In
a rule prescribing such a standard, DOE
includes an explanation of the basis on
which such higher or lower level was
established. (42 U.S.C. 6295(q)(2)) DOE
followed a similar process in the context
of today’s rulemaking.
Federal energy conservation
requirements generally supersede State
laws or regulations concerning energy
conservation testing, labeling, and
standards. (42 U.S.C. 6297(a)–(c)) DOE
may, however, grant waivers of Federal
pre-emption for particular State laws or
regulations, in accordance with the
procedures and other provisions set
forth under 42 U.S.C. 6297(d).
B. Background
As noted above, the current energy
conservation standards for commercial
warm air furnaces were set by EPACT
1992. On October 21, 2004, DOE
published a final rule in the Federal
Register which adopted definitions for
‘‘commercial warm air furnace’’ and
‘‘thermal efficiency,’’ promulgated test
procedures for this equipment, and
recodified the energy conservation
standards so that the standards are
located contiguous with the test
procedures in the Code of Federal
Regulations (CFR). 69 FR 61916, 61917.
In the same final rule, DOE incorporated
by reference (see § 431.75) a number of
industry test standards relevant to
commercial warm air furnaces,
including American National Standards
Institute (ANSI) Standard Z21.47–1998,
‘‘Gas-Fired Central Furnaces,’’ for gasfired furnaces, Underwriters
Laboratories (UL) Standard 727–1994,
‘‘Standard for Safety for Oil-Fired
Central Furnaces,’’ for oil-fired furnaces,
provisions from Hydronics Institute (HI)
Standard BTS–2000, ‘‘Method to
Determine Efficiency of Commercial
Space Heating Boilers,’’ to calculate flue
loss for oil-fired furnaces, and the
American Society of Heating,
Refrigerating, and Air-conditioning
Engineers (ASHRAE) Standard 103–
1993, ‘‘Method of Testing for Annual
Fuel Utilization Efficiency of
Residential Central Furnaces and
Boilers,’’ to determine the incremental
efficiency of condensing furnaces under
steady-state conditions. Id. Then in a
final rule published in the Federal
Register on May 16, 2012, DOE updated
the test procedures for commercial
warm air furnaces to match the
procedures specified in ASHRAE
Standard 90.1–2010, which referenced
E:\FR\FM\02MYP1.SGM
02MYP1
25629
Federal Register / Vol. 78, No. 85 / Thursday, May 2, 2013 / Proposed Rules
ANSI Z21.47–2006, ‘‘Gas-Fired Central
Furnaces,’’ for gas-fired furnaces and UL
727–2006, ‘‘Standard for Safety for Oil-
Fired Central Furnaces,’’ for oil-fired
furnaces. 77 FR 28928, 28987–88. The
current Federal energy conservation
standards, for this equipment are shown
in Table 1.
TABLE 1—MINIMUM HEATING EFFICIENCY LEVELS FOR COMMERCIAL WARM AIR FURNACES
Equipment type
Input capacity
Gas-fired Commercial Warm Air Furnace .......................................................................
Oil-fired Commercial Warm Air Furnace .........................................................................
Minimum thermal
efficiency level*
Compliance date
80%
81%
1/1/1994
1/1/1994
≥225,000 Btu/h
≥225,000 Btu/h
mstockstill on DSK4VPTVN1PROD with PROPOSALS
*At the maximum rated capacity (rated maximum input).
C. Rulemaking Process
DOE generally follows specific criteria
when prescribing amended standards
for covered ‘‘ASHRAE equipment.’’ (See
generally 42 U.S.C. 6313(a)(6)(A)–(C).)
When proposing to adopt more-stringent
standard levels than those contained in
ASHRAE Standard 90.1, DOE must
evaluate whether clear and convincing
evidence exists demonstrating that such
amended standards would be
technologically feasible and would
result in significant additional energy
savings, and then must consider
whether amended standards are
economically justified. (42 U.S.C.
6313(a)(6)(A)(ii)(II))
In assessing the appropriateness of
amending the standards that are
currently in place for commercial warm
air furnaces, DOE plans to conduct its
analyses in stages, with a positive result
leading to a subsequent stage of the
analysis. Under this approach, DOE
would first evaluate whether morestringent standards are technologically
feasible and would lead to significant
additional energy savings. If either of
these prongs is not met, DOE would
conduct no further analysis, because the
statutory criteria for adoption of the
more-stringent standard could not be
met. However, if this initial assessment
is positive, DOE plans to conduct indepth analyses of the costs and benefits
of the potential amended standards to
determine whether such amended
standards would be economically
justified. The analyses would include
the following steps: (1) Engineering; (2)
energy use; (3) markups; (4) life-cycle
cost and payback period; and (5)
national impacts. If, after conducting
those analyses, DOE reasons that there
is a high likelihood that more-stringent
standards would be economically
justified, DOE will conduct downstream
analyses including an analysis of: (1)
Manufacturer impacts; (2) emission
impacts; (3) utility impacts; (4)
employment impacts; and (5) regulatory
impacts. These analyses are the same
ones DOE routinely applies when
evaluating potential energy conservation
standards for a given type of product or
VerDate Mar<15>2010
16:43 May 01, 2013
Jkt 229001
equipment. DOE will also conduct
several other analyses that support those
previously listed, including the market
and technology assessment, the
screening analysis (which contributes to
the engineering analysis), and the
shipments analysis (which contributes
to the national impact analysis). As
detailed throughout this RFI, DOE is
publishing this notice as the first step in
the analytical process and is specifically
requesting input and data from
interested parties to aid in the
development of the technical analyses.
Due to the relatively short timeline for
this rulemaking set forth by AEMTCA,
DOE anticipates moving from this RFI
directly to publication of either a
determination that the commercial
warm air furnaces standards do not
need to be amended or a notice of
proposed rulemaking for amended
standards by the December 31, 2013
deadline.
II. Planned Rulemaking Analyses
In this section, DOE identifies a
variety of issues on which it seeks input
and data in order to aid its development
of the technical and economic analyses
to determine whether amended energy
conservation standards may be
warranted. In addition, DOE welcomes
comments on other issues relevant to
this rulemaking that may not
specifically be identified in this notice.
A. Market Assessment
The market and technology
assessment provides information about
the commercial warm air furnace
industry that will be used throughout
the rulemaking process. For example,
this information will be used to
determine whether the existing
equipment class structure requires
modification based on the statutory
criteria for setting such classes and to
explore the potential for technological
improvements in the design and
manufacturing of such equipment. The
Department uses qualitative and
quantitative information to assess the
past and present industry structure and
market characteristics. For this
PO 00000
Frm 00010
Fmt 4702
Sfmt 4702
rulemaking, DOE will use existing
market materials and literature from a
variety of sources, including industry
publications, trade journals, government
agencies, and the AHRI Directory of
Certified Product Performance.5
Additionally, DOE will consider
conducting interviews with
manufacturers to assess the overall
market for commercial warm air
furnaces.
The current standards for commercial
warm air furnaces are specified for two
equipment classes which are
characterized by fuel type—(1) gas-fired
commercial warm air furnaces with
capacity of 225,000 Btu per hour or
more and (2) oil-fired commercial warm
air furnaces with capacity of 225,000
Btu per hour or more. As a starting
point, DOE plans to use the existing
equipment class structure. However,
DOE will consider additional equipment
classes for capacities or other
performance-related features that
inherently effect efficiency and justify
the establishment of a different energy
conservation standard. For instance,
DOE may consider adopting equipment
classes to differentiate between
weatherized and non-weatherized
commercial warm air furnaces, or DOE
might also consider creating an
equipment class for three-phase
equipment with an input capacity less
than 225,000 Btu/h. Each of these
potential new equipment classes, and
the rationale therefore, are discussed
immediately below.
1. Potential New Product Classes
a. Weatherized and Non-Weatherized
Commercial Furnaces
Based on a preliminary review of the
commercial furnace market, DOE
understands that almost all commercial
warm air furnaces are installed outdoors
on rooftops, but there is a very small
segment of the commercial warm air
furnace market that consists of units
installed indoors. These indoor
5 The AHRI Directory can be found at: https://
www.ahridirectory.org/ahridirectory/pages/
home.aspx (Last accessed on April 11, 2013).
E:\FR\FM\02MYP1.SGM
02MYP1
25630
Federal Register / Vol. 78, No. 85 / Thursday, May 2, 2013 / Proposed Rules
mstockstill on DSK4VPTVN1PROD with PROPOSALS
commercial warm air furnace models
appear to consist of all the oil-fired
furnace models on the market and a few
gas-fired furnace models. One of the
indoor gas-fired model lines utilizes
condensing heat exchanger technology
to achieve a thermal efficiency of 90
percent.
Installation location (i.e., indoors or
outdoors) is significant, because it
relates to the risk of condensate
freezing. If the outdoor ambient
temperature falls below freezing, the
condensate can freeze and cause a
backflow of condensate into the
furnace’s internal components and
damage them. Although use of
condensing technology may be possible
in outdoor weatherized furnaces (see
section II.B.1 for further discussion),
condensing, non-weatherized heat
exchanger technology has been
demonstrated as technologically feasible
for indoor applications in both the
residential and commercial furnace
markets. Condensing heat exchanger
technology is easier to employ on nonweatherized furnaces, because they are
installed indoors and there is little to no
risk of condensate freezing since the
appliance will be installed in or
adjacent to a conditioned space. Even
indoor furnaces installed in nonconditioned spaces have minimal
chances of freezing in comparison to
units that are completely outdoors,
because they can be insulated from
outdoor conditions. Thus, if indoor,
non-weatherized commercial warm air
furnace units were separated from
outdoor, weatherized units in a new
equipment class, there would be the
potential for additional energy savings
by utilizing condensing heat exchanger
technology. Consequently, DOE has
tentatively concluded that this is a
performance-related feature that may
justify separate equipment classes for
these types of equipment.
Issue 1: DOE requests comment on the
potential energy savings in creating a
separate equipment classes for nonweatherized, indoor commercial warm
air furnaces and weatherized, outdoor
commercial warm air furnaces. DOE is
also interested in learning about existing
equipment that fall into this potential
equipment class, as well as the market
penetration of such equipment.
b. Three-Phase Equipment With an
Input Capacity Less Than 225,000
Btu/h
EPCA defines a commercial ‘‘warm air
furnace’’ as ‘‘a self-contained oil- or gasfired furnace designed to supply heated
air through ducts to spaces that require
it and includes combination warm air
furnace/electric air conditioning units
VerDate Mar<15>2010
16:43 May 01, 2013
Jkt 229001
but does not include unit heaters and
duct furnaces.’’ (42 U.S.C. 6311(11)(A))
DOE notes that EPCA itself does not
place a limit on the input capacity,
specify a current phase type (singlephase or three-phase), or include any
other similar criteria in the statutory
definition that would restrict the scope
of commercial warm air furnaces as
covered equipment. However, when
promulgating EPCA’s initial energy
conservation standards for commercial
warm air furnaces, Congress only
included energy conservation standards
for commercial warm air furnaces with
input ratings of 225,000 Btu/h or more.
In light of the above, when establishing
its regulations for commercial warm air
furnaces in the CFR, DOE reiterated
EPCA’s definition of a ‘‘warm air
furnace’’ and further defined a
‘‘commercial warm air furnace’’ as ‘‘a
warm air furnace that is industrial
equipment, and that has a capacity
(rated maximum input) of 225,000 Btu
per hour or more’’ at 10 CFR 431.72.
However, DOE is open to considering
energy conservation standards for
commercial warm air furnaces of
different capacities as part of this
rulemaking to consider amended
standards.
EPCA and the CFR define a
residential ‘‘furnace’’ as ‘‘a product
which utilizes only single-phase electric
current, or single-phase electric current
or DC current in conjunction with
natural gas, propane, or home heating
oil, and which—
(a) Is designed to be the principal
heating source for the living space of a
residence;
(b) Is not contained within the same
cabinet with a central air conditioner
whose rated cooling capacity is above
65,000 Btu per hour;
(c) Is an electric central furnace,
electric boiler, forced-air central
furnace, gravity central furnace, or low
pressure steam or hot water boiler; and
(d) Has a heat input rate of less than
300,000 Btu per hour for electric boilers
and low pressure steam or hot water
boilers and less than 225,000 Btu per
hour for forced-air central furnaces,
gravity central furnaces, and electric
central furnaces, gravity central
furnaces, and electric central furnaces.’’
(42 U.S.C 6291(23); 10 CFR 430.2)
Currently, DOE has promulgated
energy conservation standards for
commercial warm air furnaces (singlephase or three-phase) with an input
greater than or equal 225,000 Btu/h (10
CFR 431.77), as well as standards for
residential (single-phase) furnaces with
an input less than 225,000 Btu/h (10
CFR 430.32(e)). Thus, there are
PO 00000
Frm 00011
Fmt 4702
Sfmt 4702
presently no energy conservation
standards for commercial three-phase
warm air furnaces with an input
capacity less than 225,000 Btu/h.
Commercial warm air furnaces are
‘‘ASHRAE equipment,’’ for which EPCA
requires that DOE maintain efficiency
standards at the efficiency levels set in
ASHRAE Standard 90.1 or morestringent levels. (42 U.S.C.
6313(a)(6)(A)) That is, if ASHRAE
amends any efficiency level with
respect to the equipment in ASHRAE
Standard 90.1, DOE must either adopt
that efficiency level or determine, with
the support of clear and convincing
evidence, that a more-stringent standard
is warranted. Id. ASHRAE Standard
90.1–2010 lists efficiency levels for
three-phase warm air furnaces in Table
6.8.1E, including for those with an input
capacity less than 225,000 Btu/h.
However, ASHRAE sets the efficiency
level for warm air furnaces with an
input capacity less than 225,000 Btu/h
as a choice between 78 percent AFUE or
80 percent thermal efficiency for units
that are not covered by DOE’s standards
for residential furnaces. The 78 percent
AFUE rating is the current Federal
efficiency standard for residential
furnaces, and the 80 percent thermal
efficiency rating is the current Federal
efficiency standard for commercial gasfired warm air furnaces.
Some residential furnace
manufacturers offer both single-phase
and three-phase versions of their
furnaces, which appear (based on a
review of product literature) to be
otherwise exactly the same. Based on a
review of market data, DOE notes that
these three-phase furnaces are typically
weatherized (i.e., outdoor) units that
generally have the same efficiency as
their single-phase counterpart. In other
cases, especially for three-phase
furnaces paired with rooftop airconditioning units with a cooling
capacity greater than 5 tons, there are no
single-phase counterparts. However, all
of these models have a thermal
efficiency of at least 80 percent, meeting
or exceeding the current Federal
efficiency standards for commercial
warm air furnaces.
DOE notes that this rulemaking
presents somewhat unique
circumstances, namely where ASHRAE
in the past had acted to adopt standards
in ASHRAE Standard 90.1 for
commercial warm air furnaces with an
input capacity less than 225,000 Btu/h
but DOE did not consider itself triggered
at that time. The new statutory 6-year
look-back review provisions for
ASHRAE equipment (as codified at 42
U.S.C. 6313(a)(6)(C)(i) and (vi)) direct
DOE to evaluate amended standards,
E:\FR\FM\02MYP1.SGM
02MYP1
Federal Register / Vol. 78, No. 85 / Thursday, May 2, 2013 / Proposed Rules
mstockstill on DSK4VPTVN1PROD with PROPOSALS
assuming that DOE has already been
triggered and set a standard at a level no
less than the ASHRAE level for the
equipment in question. In this case, if
DOE does not find that clear and
convincing evidence exists to support
adoption of a more-stringent standard,
DOE will adopt one of the standard
levels in ASHRAE Standard 90.1 as the
Federal standard (AFUE or thermal
efficiency).
Issue 2: DOE requests comment on the
need to establish an equipment class for
three-phase commercial warm air
furnaces with an input capacity less
than 225,000 Btu/h and the potential
energy savings that could be achieved
from creating such an equipment class.
Issue 3: DOE also requests comment
on whether AFUE or thermal efficiency
is an appropriate efficiency metric for
three-phase commercial warm air
furnaces with an input capacity less
than 225,000 Btu/h.
B. Engineering Analysis
The engineering analysis estimates
the cost-efficiency relationship of
equipment at different levels of
increased energy efficiency. This
relationship serves as the basis for the
cost-benefit calculations for commercial
customers, manufacturers, and the
Nation. In determining the costefficiency relationship, DOE will
estimate the increase in manufacturer
cost associated with increasing the
efficiency of equipment above the
baseline at various efficiency levels up
to the maximum technologically feasible
(‘‘max-tech’’) efficiency level for each
equipment class. The baseline model is
used as a reference point for each
equipment class in the engineering
analysis and the life-cycle cost and
payback-period analyses. Typically,
DOE would consider equipment that
just meets the minimum energy
conservation standard as baseline
equipment. The vast majority of
commercial warm air furnaces on the
market achieve thermal efficiency
ratings between 80 percent (the
minimum efficiency standard) and 82
percent, inclusively, with two model
lines achieving a thermal efficiency
rating of 90 percent. In this engineering
analysis, DOE is planning on analyzing
the technology options and cost for
equipment at 80 percent, 82 percent,
and 90 percent thermal efficiencies.
Issue 4: DOE requests information on
max-tech efficiency levels achievable in
the current market.
Issue 5: DOE requests feedback on its
proposed efficiency levels for analysis.
Issue 6: DOE requests information
regarding the technology differences
between commercial furnaces at 80
VerDate Mar<15>2010
16:43 May 01, 2013
Jkt 229001
percent thermal efficiency ratings and
more-efficient commercial furnaces.
In order to determine the costefficiency relationship, DOE anticipates
drawing upon a variety of resources.
DOE will use knowledge gained from
previous rulemakings for similar
equipment and consult manufacturers,
technical experts, and product literature
to estimate the cost of equipment with
increased efficiency. DOE may also use
reverse-engineering (or cost-assessment)
techniques that include teardown
analysis to assist in determining the
cost-efficiency relationship. A teardown
analysis (or ‘‘physical teardown’’)
determines the production cost of a
piece of equipment by disassembling
the equipment ‘‘piece-by-piece’’ and
estimating the material and labor cost of
each component. The information from
teardowns is then inputted into a cost
model which fully accounts for labor,
material, overhead, and depreciation to
develop an estimate of the total
manufacturer production cost (MPC). A
supplementary method called a catalog
teardown (or ‘‘virtual teardown’’) uses
published manufacturer catalogs and
supplementary component data to
estimate the major physical differences
between a piece of equipment that has
been physically disassembled and
another piece of similar equipment.
These two methods could be used
individually or in combination to help
DOE determine the cost-efficiency
relationship for commercial warm air
furnaces. If DOE finds that sufficient
information exists, based on previous
analyses of similar products and in
manufacturer literature and information,
to estimate the costs using virtual
teardowns in lieu of physical
teardowns, DOE may choose to use only
virtual teardowns, an approach which
would yield the necessary information
while saving time and resources.
Issue 7: DOE requests feedback on the
possible approaches identified for the
engineering analysis and on what the
appropriate representative capacities
and characteristics would be for each
equipment class.
1. Condensing Weatherized Commercial
Warm Air Furnaces
As briefly discussed in section II.A.1.a
above, furnaces that utilize condensing
heat exchanger technology extract more
useable heat from the flue gas via a
secondary heat exchanger. This extra
heat extraction can cause water vapor to
condense from the gas, hence the term
‘‘condensing furnace.’’ This technology
has not become established in the
commercial warm air furnace market
because of challenges associated with
removing acidic condensate from units
PO 00000
Frm 00012
Fmt 4702
Sfmt 4702
25631
installed outdoors, which is the majority
of the commercial warm air furnace
market. When the outdoor ambient
temperature falls below freezing, the
condensate leaving the drain pipe can
freeze and cause a backflow of
condensate into the furnace’s internal
components which can permanently
damage the furnace, creating reliability
issues. If the furnace becomes disabled
while the outdoor ambient temperatures
are below freezing and if the furnace is
not repaired or replaced in a timely
fashion, there could be a danger to
building occupants due to exposure to
low temperatures. Also, because this
condensate is acidic, it may need to be
treated with a neutralizer before
discharging it into a sewer system,
according to some local codes.
In researching the potential for
rooftop condensate disposal methods,
DOE identified two patents from major
manufacturers that provided methods
for condensate disposal in outdoor
furnaces. DOE is also aware of one
manufacturer that markets a dedicated
outdoor air system with an optional
heating section that utilizes a
condensing heat exchanger to achieve a
thermal efficiency over 90 percent, and
which drains the condensate into the
heated building space to prevent
condensate freezing. The manufacturer
also recommends completely draining
the condensate drain system and
secondary heat exchanger or applying
heat tape to the drain system in order to
prevent condensate freezing. DOE
tentatively plans to examine condensing
heat exchangers as a viable technology
option for improving the thermal
efficiency of commercial furnaces and
analyze it as part of the engineering
analysis.
Issue 8: DOE requests comment on the
feasibility of using condensing heat
exchanger technology in weatherized
commercial warm air furnaces. DOE is
also interested in comments on issues
related to implementing identified
condensing heat exchanger technologies
in outdoor warm air furnaces, as well as
costs associated with implementing a
condensate drain into the building’s
space.
C. Markups Analysis
To carry out the life-cycle cost (LCC)
and payback period (PBP) calculations,
DOE needs to determine the cost to the
commercial customer of baseline
equipment that satisfies the currently
applicable standards, and the cost of the
more-efficient unit the customer would
purchase under potential amended
standards. This is done by applying a
markup multiplier to the manufacturer’s
E:\FR\FM\02MYP1.SGM
02MYP1
25632
Federal Register / Vol. 78, No. 85 / Thursday, May 2, 2013 / Proposed Rules
mstockstill on DSK4VPTVN1PROD with PROPOSALS
selling price to estimate the commercial
customer’s price.
DOE intends to characterize several
types of distribution channels to
describe how the equipment passes
from the manufacturer to the customer.
The first distribution channel is
characterized as follows:
Manufacturer ‰ Wholesaler ‰
Mechanical contractor ‰ General
contractor ‰ Consumer
In the second distribution channel,
the manufacturer sells the equipment
directly to the customer through a
national account, which is characterized
as follows:
Manufacturer ‰ Consumer
In addition, DOE plans to consider
cases when the contractor’s sale of the
equipment includes a start-up/check-out
contract, in which cases the equipment
markup is included in the contract
costs.
Issue 9: DOE seeks input from
stakeholders on whether the
distribution channels described above
are relevant for commercial warm air
furnaces.
Issue 10: DOE seeks input on the
percentage of equipment being
distributed through the various types of
distribution channels, and whether the
share of equipment through each
channel varies based on equipment
capacity.
To develop markups for the parties
involved in the distribution of the
equipment, DOE utilized several sources
including: (1) The Heating, AirConditioning & Refrigeration
Distributors International (HARDI) 2012
Profit Report6 to develop wholesaler
markups, (2) the 2005 Air Conditioning
Contractors of America’s (ACCA)
financial analysis for the heating,
ventilation, air-conditioning, and
refrigeration (HVACR) contracting
industry 7 to develop mechanical
contractor markups, and (3) U.S. Census
Bureau’s 2007 Economic Census data 8
for the commercial and institutional
building construction industry to
develop general contractor markups.
Issue 11: DOE seeks recent data to
establish the markups for the parties
involved with the distribution of the
equipment.
6 Heating, Air Conditioning & Refrigeration
Distributors International 2012 Profit Report
(Available at: https://www.hardinet.org/ProfitReport) (Last accessed April 10, 2013).
7 Air Conditioning Contractors of America
(ACCA), Financial Analysis for the HVACR
Contracting Industry: 2005 (2005) (Available at:
https://https://www.acca.org/store/product.php?
pid=142) (Last accessed April 10, 2013).
8 U.S. Census Bureau, 2007 Economic Census
Data (2007) (Available at: https://www.census.gov/
econ/) (Last accessed April 10, 2013).
VerDate Mar<15>2010
17:47 May 01, 2013
Jkt 229001
D. Energy Use Analysis
The purpose of the energy use
analysis is to assess the energy
requirements of equipment at different
efficiencies in several building types
that utilize the equipment. DOE intends
to base the energy use analysis for the
current effort on building simulation
data or bin method. The building
simulation will include building
operation hourly profiles, which are
based on building characteristics from
the Energy Information Administration’s
2003 Commercial Building Energy
Consumption Survey (CBECS) 9 for the
subset that uses the type of equipment
covered by the standards. Each building
will be assigned to a specific location,
and the approach will capture
variability in heating loads due to
factors such as building activity,
schedule, occupancy, local weather, and
shell characteristics.
CBECS 2012 is currently in
development but will not be available in
time for this rulemaking. In addition,
the 2003 CBECS sample may not
include examples of recent innovations
in building shell or window
technologies that reduce cooling loads.
Therefore, DOE intends on reviewing
other data sets (e.g., the technology
penetration curves used in the latest
National Energy Modeling System
(NEMS) 10), to determine whether a
significant fraction of the current
building population is not represented
by CBECS 2003.
Issue 12: DOE requests comment or
seeks input from stakeholders on the
overall method to determine the
equipment load profiles;
Issue 13: DOE requests comment or
seeks input from stakeholders on the
current distribution of equipment
efficiencies in the building population;
Issue 14: DOE requests comment or
seeks input from stakeholders on how
equipment energy use for a given
heating load shape scales as a function
of capacity (i.e., whether two
commercial furnace units of a certain
capacity use the same total heating
energy as one commercial furnace unit
of twice the capacity)
9 Energy Information Administration (EIA), 2003
Commercial Building Energy Consumption Survey
(CBECS) (Available at: https://www.eia.gov/
consumption/commercial/) (Last accessed April 10,
2013).
10 For more information on NEMS, refer to the
U.S. Department of Energy, Energy Information
Administration (EIA) documentation. A useful
summary is National Energy Modeling System: An
Overview 2003, DOE/EIA–0581(2003). Each year,
EIA uses NEMS to produce an energy forecast for
the United States, the Annual Energy Outlook
(AEO). For this analysis, DOE intends to use the
version of NEMS based on AEO 2013 (Available at:
https://www.eia.gov/forecasts/aeo/).
PO 00000
Frm 00013
Fmt 4702
Sfmt 4702
Issue 15: DOE requests comment or
seeks input from stakeholders on
whether building simulations developed
for small and large commercial furnace
equipment are applicable to very large
equipment, and
Issue 16: DOE requests comment on
the fraction of commercial warm air
furnaces which are used in residential
applications such as residential multifamily buildings as well as the fraction
of residential furnaces that are used for
commercial applications.
E. Life-Cycle Cost and Payback Period
Analysis
The purpose of the LCC and PBP
analysis is to analyze the effects of
potential amended energy conservation
standards on customers of commercial
furnace equipment by determining how
a potential amended standard affects
their operating expenses (usually
decreased) and their total installed costs
(usually increased).
DOE intends to analyze the potential
for variability and uncertainty by
performing the LCC and PBP
calculations on a representative sample
of individual commercial buildings.
DOE plans to utilize the sample of
buildings developed for the energy use
analysis 11 and the corresponding
simulations results. Within a given
building, one or more commercial
furnace units may serve the building’s
space-conditioning needs, depending on
the heating load requirements of the
building. As a result, the Department
intends to express the LCC and PBP
results as the number of commercial
furnace customers experiencing
economic impacts of different
magnitudes. DOE plans to model both
the uncertainty and the variability in the
inputs to the LCC and PBP analysis
using Monte Carlo simulation and
probability distributions. As a result, the
LCC and PBP results will be displayed
as distributions of impacts compared to
the base case conditions.
Issue 17: DOE requests comment from
stakeholders on the overall method that
it intends on using to conduct the LCC
and PBP analysis for commercial warm
air furnaces.
Inputs to the LCC and PBP analysis
are categorized as: (1) Inputs for
establishing the purchase expense,
otherwise known as the total installed
cost, and (2) inputs for calculating the
operating expense.
The primary inputs for establishing
the total installed cost are the baseline
11 DOE plans to utilize the building types defined
in CBECS 2003. Definitions of CBECS building
types can be found at https://www.eia.gov/emeu/
cbecs/building_types.html.
E:\FR\FM\02MYP1.SGM
02MYP1
Federal Register / Vol. 78, No. 85 / Thursday, May 2, 2013 / Proposed Rules
mstockstill on DSK4VPTVN1PROD with PROPOSALS
customer price, standard-level customer
price increases, and installation costs.
Baseline customer prices and standardlevel customer price increases will be
determined by applying markups to
manufacturer price estimates. The
installation cost is added to the
customer price to arrive at a total
installed cost. DOE intends to develop
installation costs for commercial warm
air furnaces using the most recent RS
Means data available.
Issue 18: DOE seeks input on the
approach and data sources it intends to
use to develop installation costs,
specifically, its intention to use the most
recent RS Means Mechanical Cost
Data.12
The primary inputs for calculating the
operating costs are equipment energy
consumption and power demand,
equipment efficiency, electricity prices
and forecasts, maintenance and repair
costs, equipment lifetime, and discount
rates. Both equipment lifetime and
discount rates are used to calculate the
present value of future operating
expenses.
The equipment energy consumption
is the site energy use associated with
providing space-heating to the building.
DOE intends to utilize calculation
methodology to establish equipment
energy use.
DOE intends to determine gas, oil,
and electricity prices based on recent or
current tariffs from a representative
sample of utilities, as well as historical
State commercial energy price data from
the Energy Information Administration
(EIA). This approach calculates energy
expenses based on actual energy prices
that customers are paying in different
geographical areas of the country. In
addition to using tariffs, DOE plans to
use data provided in EIA’s Form 861
data 13 to calculate commercial
electricity prices, EIA’s Natural Gas
Navigator 14 to calculate commercial
natural gas prices, and EIA’s State
Energy Data System (SEDS) 15 to
calculate liquefied petroleum gas (LPG)
and fuel oil prices. Future energy prices
will likely be projected using trends
12 RS Means, 2013 Mechanical Cost Data
(Available at: https://rsmeans.reedconstructiondata.
com/60023.aspx) (Last accessed April 10, 2013).
13 Energy Information Administration (EIA),
Survey form EIA–861—Annual Electric Power
Industry Report (Available at: https://www.eia.gov/
electricity/data/eia861/) (Last accessed
April 15, 2013).
14 Energy Information Administration (EIA),
Natural Gas Navigator (Available at: https://tonto.
eia.doe.gov/dnav/ng/ng_pri_sum_dcu_nus_m.htm)
(Last accessed April 15, 2013).
15 Energy Information Administration (EIA), State
Energy Data System (SEDS) (Available at: https://
www.eia.gov/state/seds/) (Last accessed April 15,
2013).
VerDate Mar<15>2010
16:43 May 01, 2013
Jkt 229001
from the EIA’s 2013 Annual Energy
Outlook (AEO).16
Issue 19: DOE seeks comment on its
approach for developing energy prices.
DOE seeks input on specific data
sources available for collecting tariffs.
Maintenance costs are expenses
associated with ensuring continued
operation of the covered equipment over
time. DOE intends to develop
maintenance costs for its analysis using
the most recent RS Means data
available. DOE plans also to consider
the cases when the equipment is
covered by service and/or maintenance
agreements.
Issue 20: DOE seeks input on the
approach and data sources it intends to
use to develop maintenance costs,
specifically, its intention to use the most
recent RS Means Facilities Maintenance
& Repair Cost Data,17 as well as to
consider the cost of service and/or
maintenance agreements.
Repair costs are expenses associated
with repairing or replacing components
of the covered equipment that have
failed. DOE intends to assess whether
repair costs vary with equipment
efficiency as part of its analysis.
Issue 21: DOE seeks comment as to
whether repair costs vary as a function
of equipment efficiency. DOE also
requests any data or information on
developing repair costs.
Equipment lifetime is the age at
which a unit of covered equipment is
retired from service. The average
equipment lifetime for commercial
warm air furnaces is estimated by
ASHRAE to be between 15 and 20
years.18 Based on these data, DOE plans
to use a 17.5 average lifetime for
commercial warm air furnaces as the
primary input for developing a Weibull
probability distribution to characterize
commercial warm air furnace lifetime.
Issue 22: DOE seeks comment on its
approach of using a Weibull probability
distribution to characterize equipment
lifetime. DOE also requests any
equipment lifetime data or information
and whether equipment lifetime varies
based on equipment class.
The discount rate is the rate at which
future expenditures are discounted to
establish their present value. DOE
intends to derive the discount rates by
16 Energy Information Administration (EIA), 2013
Annual Energy Outlook (AEO) Full Version
(Available at: https://www.eia.gov/forecasts/aeo/)
(Last accessed April 15, 2013).
17 RS Means, 2013 Facilities Maintenance &
Repair Cost Data (Available at: https://rsmeans.reed
constructiondata.com/60303.aspx) (Last accessed
April 10, 2013).
18 American Society of Heating, Refrigerating and
Air-Conditioning Engineers, Inc. (ASHRAE),
ASHRAE Handbook of HVAC Systems and
Equipment (2008) p. 32.8.
PO 00000
Frm 00014
Fmt 4702
Sfmt 4702
25633
estimating the cost of capital of
companies that purchase commercial
furnace equipment.
DOE measures LCC and PBP impacts
of potential standard levels relative to a
base case that reflects the likely market
in the absence of amended standards.
DOE plans to develop market-share
efficiency data (i.e., the distribution of
equipment shipments by efficiency) for
the equipment classes DOE is
considering, for the year in which
compliance with any amended
standards would be required.
DOE also plans to assess the
applicability of the ‘‘rebound effect’’ in
the energy use analysis for commercial
warm air furnaces. A rebound effect
occurs when a piece of equipment that
is made more efficient is used more
intensively, so that the expected energy
savings from the efficiency
improvement may not fully materialize.
However, at this time, DOE is not aware
of any information about the rebound
effect for this equipment type.
Issue 23: DOE requests data on
current efficiency market shares (of
shipments) by equipment class, and also
similar historic data. In particular, DOE
seeks efficiency data for very large
equipment.
Issue 24: DOE also requests
information on expected trends in
efficiency for commercial warm air
furnaces over the next five years.
Issue 25: DOE seeks comments and
data on the rebound effect that may be
associated with more-efficient
commercial warm air furnaces.
F. Shipment Analysis
DOE uses shipment projections by
equipment class to calculate the
national impacts of standards on energy
consumption, net present value (NPV),
and future manufacturer cash flows.
DOE intends to develop a shipments
model for commercial warm air furnace
equipment driven by historical
shipments data. The accuracy of the
shipments model is highly dependent
on these historical shipments data, as
the data are used not only to build up
an equipment stock but also to calibrate
the shipments model. If no shipments
data are available, DOE plans to
consider using 1994 shipments data
from the Gas Appliance Manufacturers
Association 19 (GAMA) (i.e., 164,300
commercial warm air gas-fired furnace
shipments),20 and applying a trend
19 This organization has subsequently become the
Air-Conditioning, Heating, and Refrigeration
Institute (AHRI).
20 Pacific Northwest National Laboratory (PNNL),
Screening Analysis for EPACT-Covered Commercial
HVAC and Water-Heating Equipment (April 2000)
E:\FR\FM\02MYP1.SGM
Continued
02MYP1
25634
Federal Register / Vol. 78, No. 85 / Thursday, May 2, 2013 / Proposed Rules
mstockstill on DSK4VPTVN1PROD with PROPOSALS
based on estimated historical
commercial warm air furnace stock
derived from CBECS data.
Issue 26: DOE seeks historical
shipments data for commercial warm air
furnaces.
The shipments model will consider
three market segments: (1) New
commercial buildings acquiring
equipment; (2) existing buildings
replacing old equipment; and (3)
existing buildings acquiring new
equipment for the first time. Two stock
categories are also considered: (1)
equipment that has received only
normal maintenance repairs; and (2)
equipment that has had its useful life
extended through additional repairs. To
determine whether a customer would
choose to repair rather than replace
their commercial furnace equipment,
the shipments model explicitly accounts
for the combined effects of changes in
purchase price, annual operating cost,
and the value of commercial floor space
on the purchase versus repair decision.
Changes to the purchase price and
operating costs due to amended energy
conservation standards were the drivers
for shipment estimates for the standards
cases relative to the base case (i.e., the
case without amended standards).
Issue 27: DOE requests comment on
the approach it intends on using to
develop the shipments model and
shipments forecasts for this rulemaking.
DOE intends to utilize the U.S.
Census Bureau data 21 to establish
historical new construction floor space,
as well as historical stock floor space.
The Annual Energy Outlook will be
used to forecast both new construction
and stock floor space. Together with
historical equipment saturation data
from CBECS, DOE will estimate
shipments to the three market segments
identified above. The utility function to
estimate the repair versus replacement
decision will be based on income per
square foot data from the Building
Owners and Managers Association
(BOMA) Commercial Building Survey
reports,22 purchase price data estimated
from the Bureau of Labor Statistics,23
(Available at: https://www.pnl.gov/main/
publications/external/technical_reports/PNNL13232.pdf) (Last accessed April 10, 2013).
21 U.S. Census Bureau, Statistical Abstract of the
United States: 2011, Table No 933—Construction
Contracts—Value of Construction and Floor Space
of Buildings by Class of Construction (Available at:
https://www.census.gov/compendia/statab/2011/
cats/construction_housing/construction_indices_
and_value.html) (Last accessed April 10, 2013).
22 Building Owners and Managers Association
International (BOMA). Experience Exchange Report
(2013) (Available at: https://www.bomaeer.com/)
(Last accessed April 10, 2013).
23 U.S. Department of Labor, Bureau of Labor
Statistics. Producers Price Index: Industry:
VerDate Mar<15>2010
16:43 May 01, 2013
Jkt 229001
and operating cost data derived from the
LCC and PBP analysis.
Issue 28: DOE seeks input on the
approach and data sources it intends to
use in developing the shipments model
and shipments forecasts for this
analysis.
G. National Impact Analysis
The purpose of the national impact
analysis (NIA) is to estimate aggregate
impacts of potential energy conservation
standards at the national level. Impacts
that DOE reports include the national
energy savings (NES) from potential
standards and the net present value
(NPV) of the total consumer benefits.
To develop the NES, DOE calculates
annual energy consumption for the base
case and the standards cases. DOE
calculates the annual energy
consumption using per-unit annual
energy use data multiplied by projected
shipments.
To develop the national NPV of
consumer benefits from potential energy
conservation standards, DOE calculates
annual energy expenditures and annual
equipment expenditures for the base
case and the standards cases. DOE
calculates annual energy expenditures
from annual energy consumption by
incorporating forecasted energy prices,
using shipment projections and average
energy efficiency projections. DOE
calculates annual equipment
expenditures by multiplying the price
per unit times the projected shipments.
The difference each year between
energy bill savings and increased
equipment expenditures is the net
savings or net costs.
A key component of DOE’s estimates
of NES and NPV are the equipment
energy efficiencies forecasted over time
for the base case and for each of the
standards cases. To develop the various
standards cases, DOE plans to develop
market-share efficiency data (i.e., data
on the distribution of equipment
shipments by efficiency) for the
commercial furnace equipment classes
DOE is considering. To estimate the
impact that amended energy
conservation standards may have in the
year compliance becomes required, DOE
has used ‘‘roll-up’’ and/or ‘‘shift’’
scenarios in its standards rulemakings.
Under the ‘‘roll-up’’ scenario, DOE
assumes: (1) Equipment efficiencies in
the base case that do not meet the new
or amended standard level under
consideration would ‘‘roll up’’ to meet
that standard level; and (2) equipment
shipments at efficiencies above the
Refrigeration and Heating Equipment (Available at:
https://www.bls.gov/ppi/home.htm) (Last accessed
April 10, 2013).
PO 00000
Frm 00015
Fmt 4702
Sfmt 4702
standard level under consideration
would not be affected. Under the ‘‘shift’’
scenario, DOE retains the pattern of the
base-case efficiency distribution but reorients the distribution at and above the
new or amended minimum energy
conservation standard. After DOE
establishes the average efficiency for the
assumed compliance date of a standard,
it can estimate future efficiency by using
the same rate of projected efficiency
growth as for the base-case efficiency
trend.
DOE intends to determine whether
there is a rebound effect associated with
more efficient commercial furnaces. If
data indicate that there is a rebound
effect, DOE will account for the rebound
effect in its calculation of NES.
DOE has historically presented NES
in terms of primary energy savings. On
August 18, 2011, DOE published a final
statement of policy in the Federal
Register announcing its intention to use
full-fuel-cycle (FFC) measures of energy
use and greenhouse gas and other
emissions in the national impact
analyses and emissions analyses
included in future energy conservation
standards rulemakings. 76 FR 51281.
While DOE stated in that notice that it
intended to use the Greenhouse Gases,
Regulated Emissions, and Energy Use in
Transportation (GREET) model to
conduct the analysis, it also said it
would review alternative methods,
including the use of NEMS. After
evaluating both models and the
approaches discussed in the August 18,
2011 notice, DOE published an
amended statement of policy,
articulating its determination that
NEMS is a more appropriate tool for this
purpose. 77 FR 49701 (Aug. 17, 2012).
Therefore, DOE intends to use the
NEMS model to conduct FFC analyses.
The method used to derive the FFC
multipliers will be described in the
technical support document (TSD).
Issue 29: In addition to historical
efficiency data, DOE also requests
information on expected trends in
efficiency of commercial warm air
furnaces over the long run.
Issue 30: DOE requests comment on
whether it should pursue a roll-up or
shift approach for potential commercial
warm air furnace standards in the
national impact analysis.
III. Public Participation
DOE invites all interested parties to
submit in writing by June 3, 2013,
comments and information on matters
addressed in this notice and on any
other matters relevant to DOE’s
consideration of potential amended
energy conservation standards for
commercial warm air furnaces.
E:\FR\FM\02MYP1.SGM
02MYP1
mstockstill on DSK4VPTVN1PROD with PROPOSALS
Federal Register / Vol. 78, No. 85 / Thursday, May 2, 2013 / Proposed Rules
After the close of the comment period,
DOE will begin collecting data,
conducting the analyses, and reviewing
the public comments. These actions will
be taken to aid in the development of a
notice of proposed rulemaking (NOPR)
for commercial warm air furnaces, if
DOE determines that the statutory
criteria have been met for amended
energy conservation standards for such
equipment.
Instructions: All submissions received
must include the agency name and
docket number and/or RIN for this
rulemaking. No telefacsimilies (faxes)
will be accepted.
Docket: The docket is available for
review at www.regulations.gov,
including Federal Register notices,
public meeting attendees’ lists and
transcripts, comments, and other
supporting documents/materials. All
documents in the docket are listed in
the www.regulations.gov index.
However, not all documents listed in
the index may be publicly available,
such as information that is exempt from
public disclosure.
A link to the docket Web page can be
found at: https://www.regulations.gov/#
!docketDetail;D=EERE-2013-BT-STD0021. This Web page contains a link to
the docket for this notice on the
www.regulations.gov Web site. The
www.regulations.gov Web page contains
simple instructions on how to access all
documents, including public comments,
in the docket.
For information on how to submit a
comment, review other public
comments and the docket, or participate
in the public meeting, contact Ms.
Brenda Edwards at (202) 586–2945 or by
email: Brenda.Edwards@ee.doe.gov.
DOE considers public participation to
be a very important part of the process
for amending energy conservation
standards. DOE actively encourages the
participation and interaction of the
public during the comment period in
each stage of the rulemaking process.
Interactions with and between members
of the public provide a balanced
discussion of the issues and assist DOE
in the rulemaking process. Anyone who
wishes to be added to the DOE mailing
list to receive future notices and
information about this rulemaking
should contact Ms. Brenda Edwards at
(202) 586–2945, or via email at
Brenda.Edwards@ee.doe.gov.
VerDate Mar<15>2010
16:43 May 01, 2013
Jkt 229001
Issued in Washington, DC, on April 26,
2013.
Kathleen B. Hogan,
Deputy Assistant Secretary for Energy
Efficiency, Energy Efficiency and Renewable
Energy.
[FR Doc. 2013–10388 Filed 5–1–13; 8:45 am]
BILLING CODE 6450–01–P
FEDERAL ELECTION COMMISSION
11 CFR Chapter I
[Notice 2013–07]
Technological Modernization
Federal Election Commission.
Advance Notice of Proposed
Rulemaking.
AGENCY:
ACTION:
SUMMARY: The Federal Election
Commission requests comments on
whether to begin a rulemaking to revise
its regulations in 11 CFR chapter I to
address contributions and expenditures
made by electronic means, such as by
credit card, debit card, Internet-based
payment processing, and text
messaging; to eliminate or update
references to outdated technologies; and
similar issues. The Commission intends
to review the comments received as it
decides what revisions, if any, it will
propose making to its rules.
DATES: Comments must be received on
or before June 3, 2013. The Commission
will determine at a later date whether to
hold a public hearing on this Notice. If
a hearing is to be held, the Commission
will publish a notice in the Federal
Register announcing the date and time
of the hearing.
ADDRESSES: All comments must be in
writing. Comments may be submitted
electronically via the Commission’s
Web site at https://www.fec.gov/fosers,
reference REG 2013–01. Commenters are
encouraged to submit comments
electronically to ensure timely receipt
and consideration. Alternatively,
comments may be submitted in paper
form. Paper comments must be sent to
the Federal Election Commission, Attn.:
Amy L. Rothstein, Assistant General
Counsel, 999 E Street, NW.,
Washington, DC 20463. All comments
must include the full name and postal
service address of a commenter, and of
each commenter if filed jointly, or they
will not be considered. The Commission
will post comments on its Web site at
the conclusion of the comment period.
FOR FURTHER INFORMATION CONTACT: Ms.
Amy L. Rothstein, Assistant General
Counsel, or Ms. Jessica Selinkoff,
Attorney, 999 E Street NW.,
Washington, DC 20463, (202) 694–1650
or (800) 424–9530.
PO 00000
Frm 00016
Fmt 4702
Sfmt 4702
25635
The
Federal Election Commission is
publishing this Advance Notice of
Proposed Rulemaking to obtain
comments on whether to revise its
regulations at 11 CFR chapter I to
address electronic transactions.
Specifically, the Commission is
considering whether to update its
regulations to reflect electronic
transactions, such as those made by
debit cards, credit cards, gift cards,
Internet-based payment processing, and
online banking.1 Such a rulemaking
could address the receipt, deposit,
accounting, recordkeeping, reporting,
redesignation, and reattribution of
electronic transactions, as well as
matching funds, conduit activity, and
contributions by text message. The
Commission is also considering whether
to revise its regulations by eliminating
or updating references to outmoded
technologies such as telegrams and fax
machines.
As a general matter, the Commission
seeks to ensure that the regulated
community is able to take advantage of
evolving technological innovations,
while ensuring that the use of the
technology is consistent with the
Federal Election Campaign Act, 2 U.S.C.
431 et seq., as amended, (‘‘the Act’’) as
well as the Presidential Election
Campaign Fund Act, 26 U.S.C. 9001 et
seq., and the Presidential Primary
Matching Payment Account Act, 26
U.S.C. 9031 et seq. (collectively,
‘‘Chapters 95 and 96 of Title 26’’). More
specifically, here the Commission
invites comments on whether and how
it should update its regulations to take
into account electronic transactions in a
manner that provides sufficient
guidance to the regulated community
while reducing the need for serial
revisions to reflect new and emerging
technologies. Should regulations
identify specific, approved means of
engaging in electronic transactions? Or
should regulations provide only general
standards or criteria? Would the latter
approach increase the risk of corruption,
abuse, or circumvention of the Act, or
Chapters 95 and 96 of Title 26, that may
not be present with a bright-line rule
that is less technologically flexible?
SUPPLEMENTARY INFORMATION:
1. Updating Outmoded Regulations
The Commission is considering
whether it should update its regulations
to reflect recent technological advances.
For example, certain regulations refer to
technologies that are obsolete or seldom
used today, such as a ‘‘telegram’’ (11
1 See Rulemaking Priorities for 2012, Agenda Doc.
12–40 (May 24, 2012), https://www.fec.gov/agenda/
2012/mtgdoc_1240.pdf.
E:\FR\FM\02MYP1.SGM
02MYP1
Agencies
[Federal Register Volume 78, Number 85 (Thursday, May 2, 2013)]
[Proposed Rules]
[Pages 25627-25635]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-10388]
[[Page 25627]]
-----------------------------------------------------------------------
DEPARTMENT OF ENERGY
10 CFR Part 431
[Docket Number EERE-2013-BT-STD-0021]
Energy Conservation Program for Certain Industrial Equipment:
Energy Conservation Standards for Commercial Warm Air Furnaces
AGENCY: Office of Energy Efficiency and Renewable Energy, Department of
Energy.
ACTION: Request for information (RFI).
-----------------------------------------------------------------------
SUMMARY: The U.S. Department of Energy (DOE) is initiating a rulemaking
to consider amended energy conservation standards for commercial warm
air furnaces. Once completed, this rulemaking will fulfill DOE's
statutory obligation by December 31, 2013 to either propose amended
energy conservation standards for warm air furnaces or to make a
determination that the existing standards do not need to be amended.
This notice seeks to solicit information to assist DOE in determining
whether national standards more stringent than those that are currently
in place would result in a significant amount of additional energy
savings and whether such amended national standards would be
technologically feasible and economically justified. In overview, this
document presents a brief description of the analysis DOE plans to
perform for this rulemaking and requests comment on various issues
relating to each of the analyses (e.g., market assessment, engineering
analysis, energy use analysis, life-cycle cost and payback period
analysis, and national impact analysis). Although this document
contains numerous specific topics on which the Department is
particularly interested in receiving written comment, DOE welcomes
views and information from the public on any subject within the scope
of this rulemaking (including relevant matters not specifically raised
in this RFI).
DATES: Written comments and information are requested on or before June
3, 2013.
ADDRESSES: Interested parties are encouraged to submit comments
electronically. However, interested persons may submit comments,
identified by docket number EERE-2013-BT-STD-0021, or by any of the
following methods:
Federal eRulemaking Portal: www.regulations.gov. Follow
the instructions for submitting comments.
Email: CommWarmAirFurn2013STD0021@ee.doe.gov. Include
docket number EERE-2013-BT-STD-0021 in the subject line of the message.
Submit electronic comments in WordPerfect, Microsoft Word, PDF, or
ASCII file format, and avoid the use of special characters or any form
of encryption.
Postal Mail: Ms. Brenda Edwards, U.S. Department of
Energy, Building Technologies Program, Mailstop EE-2J, 1000
Independence Avenue SW., Washington, DC 20585-0121. If possible, please
submit all items on a compact disc (CD), in which case it is not
necessary to include printed copies.
Hand Delivery/Courier: Ms. Brenda Edwards, U.S. Department
of Energy, Building Technologies Program, 6th Floor, 950 L'Enfant Plaza
SW., Washington, DC 20024. Telephone: (202) 586-2945. If possible,
please submit all items on a CD, in which case it is not necessary to
include printed copies.
For detailed instructions on submitting comments and additional
information on the rulemaking process, see section III of this document
(Public Participation).
FOR FURTHER INFORMATION CONTACT: Requests for additional information
may be sent to Mr. John Cymbalsky, 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) 286-1692. Email: commercial_furnaces@ee.doe.gov.
Mr. Eric Stas, U.S. Department of Energy, Office of the General
Counsel, GC-71, 1000 Independence Avenue SW., Washington, DC 20585-
0121. Telephone: (202) 586-9507. Email: Eric.Stas@hq.doe.gov.
For information on how to submit or review public comments, contact
Ms. Brenda Edwards, U.S. Department of Energy, Office of Energy
Efficiency and Renewable Energy, Building Technologies Program,
Mailstop EE-2J, 1000 Independence Avenue SW., Washington, DC 20585-
0121. Telephone: (202) 586-2945. Email: Brenda.Edwards@ee.doe.gov.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Introduction
A. Authority
B. Background
C. Rulemaking Process
II. Planned Rulemaking Analyses
A. Market Assessment
1. Potential New Product Classes
a. Weatherized and Non-Weatherized Commercial Furnaces
b. Three-Phase Equipment With an Input Capacity Less Than
225,000 Btu/h
B. Engineering Analysis
1. Condensing Weatherized Commercial Warm Air Furnaces
C. Markups Analysis
D. Energy Use Analysis
E. Life-Cycle Cost and Payback Period Analysis
F. Shipment Analysis
G. National Impact Analysis
III. Public Participation
I. Introduction
A. Authority
Title III, Part C \1\ of the Energy Policy and Conservation Act of
1975 (EPCA or the Act), Public Law 94-163 (42 U.S.C. 6311-6317, as
codified), added by Public Law 95-619, Title IV, Sec. 441(a),
established the Energy Conservation Program for Certain Industrial
Equipment, which includes provisions covering the commercial warm air
furnace equipment that is the subject of this notice.\2\ In general,
this program addresses the energy efficiency of certain types of
commercial and industrial equipment. Relevant provisions of the Act
specifically include definitions (42 U.S.C. 6311), energy conservation
standards (42 U.S.C. 6313), test procedures (42 U.S.C. 6314), labelling
provisions (42 U.S.C. 6315), and the authority to require information
and reports from manufacturers (42 U.S.C. 6316).
---------------------------------------------------------------------------
\1\ For editorial reasons, upon codification in the U.S. Code,
Part C was re-designated Part A-1.
\2\ All references to EPCA in this document refer to the statute
as amended through the American Energy Manufacturing Technical
Corrections Act, Public Law 112-210 (Dec. 18, 2012).
---------------------------------------------------------------------------
The initial Federal energy conservation standards for commercial
warm air furnaces were added to EPCA by the Energy Policy Act of 1992
(EPACT 1992), Public Law 102-486. (42 U.S.C. 6313(a)(4)) These types of
covered equipment have a rated capacity (rated maximum input) greater
than or equal to 225,000 Btu/h, can be gas-fired or oil-fired, and are
designed to heat commercial buildings. Id.
Section 5(b) of the American Energy Manufacturing Technical
Corrections Act (AEMTCA), Public Law 112-210 (Dec. 18, 2012), amended
EPCA to include a requirement for DOE to consider amending the
standards for certain types of commercial and industrial equipment \3\
every six years, as well as a mandate that DOE must conduct an
expedited rulemaking to consider amended energy conservation standards
for any covered equipment of
[[Page 25628]]
those types for which more than 6 years has elapsed since the issuance
of the most recent final rule establishing or amending a standard for
the product as of the date of AEMTCA's enactment (i.e., December 18,
2012). (42 U.S.C. 6313(a)(6)(C)(i) and (vi) \4\) In general, when
conducting such a review, DOE must publish either: (1) a notice of
determination that the current standards do not need to be amended, or
(2) a notice of proposed rulemaking containing proposed standards;
however, for those types of equipment for which more than six years has
passed since the last final rule, Congress also set a deadline of
December 31, 2013 for publication of the determination/proposed rule.
Id.
---------------------------------------------------------------------------
\3\ These equipment types include small, large, and very large
commercial package air-conditioning and heating equipment, packaged
terminal air conditioners and heat pumps, warm air furnaces,
packaged boilers, storage water heaters, instantaneous water
heaters, or unfired hot water storage tanks (``ASHRAE equipment'').
\4\ It is noted the AEMTCA inadvertently assigned two separate
provisions to 42 U.S.C. 6313(a)(6)(C)(vi). The provision cited above
is the one most relevant to this RFI.
---------------------------------------------------------------------------
In order to meet the new requirements added by AEMTCA, DOE has
begun to review its existing energy conservation standards for those
equipment types listed in 42 U.S.C. 6313(a) for which at least six
years have elapsed since issuance of the most recent final rule,
including the commercial warm air furnaces that are the subject of this
notice.
Today's notice represents the initiation of the mandatory review
process required by AEMTCA and seeks input from the public to assist
DOE with its evaluation of whether to amend the current Federal energy
conservation standards for commercial warm air furnaces. In making this
determination, DOE must evaluate whether there is clear and convincing
evidence that more-stringent national standards would result in
significant additional energy savings, and be technologically feasible
and economically justified. (42 U.S.C. 6313(a)(6)(A)(ii)(II)) In
determining whether an amended energy conservation standard is
economically justified, the Secretary shall, after receiving views and
comments furnished with respect to a proposed standard, determine
whether the benefits of the standard exceed the burden of the proposed
standard by, to the maximum extent practicable, considering the
following seven factors:
(1) The economic impact of the standard on the manufacturers and on
the consumers of the products subject to the standard;
(2) The savings in operating costs throughout the estimated average
life of the product in the type (or class) compared to any increase in
the price of, or in the initial charges for, or maintenance expenses
of, the products that are likely to result from the standard;
(3) The total projected quantity of energy savings likely to result
directly from the standard;
(4) Any lessening of the utility or the performance of the products
likely to result from 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
standard;
(6) The need for national energy conservation; and
(7) Other factors the Secretary considers relevant.
(42 U.S.C. 6313(a)(6)(B)(ii))
EPCA, as codified, also contains what is known as an ``anti-
backsliding'' provision, which prevents the Secretary from prescribing
any amended standard that either increases the maximum allowable energy
use or decreases the minimum required energy efficiency of a covered
product. (42 U.S.C. 6295(o)(1)) Also, 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 covered 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. (42 U.S.C.
6295(o)(4))
Further, EPCA, as codified, establishes a rebuttable presumption
that a standard is economically justified if the Secretary finds that
the additional cost to the customer 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 applicable test procedure. (42 U.S.C.
6295(o)(2)(B)(iii))
Additionally, when a type or class of covered equipment has two or
more subcategories, DOE often specifies more than one standard level.
DOE generally will adopt a different standard level than that which
applies generally to such type or class of products for any group of
covered products that have the same function or intended use if DOE
determines that 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 which justifies a higher or lower standard. (42 U.S.C. 6295(q)(1))
In determining whether a performance-related feature justifies a
different standard for a group of products, DOE generally considers
such factors as the utility to the customer of the feature and other
factors DOE deems appropriate. In a rule prescribing such a standard,
DOE includes an explanation of the basis on which such higher or lower
level was established. (42 U.S.C. 6295(q)(2)) DOE followed a similar
process in the context of today's rulemaking.
Federal energy conservation requirements generally supersede State
laws or regulations concerning energy conservation testing, labeling,
and standards. (42 U.S.C. 6297(a)-(c)) DOE may, however, grant waivers
of Federal pre-emption for particular State laws or regulations, in
accordance with the procedures and other provisions set forth under 42
U.S.C. 6297(d).
B. Background
As noted above, the current energy conservation standards for
commercial warm air furnaces were set by EPACT 1992. On October 21,
2004, DOE published a final rule in the Federal Register which adopted
definitions for ``commercial warm air furnace'' and ``thermal
efficiency,'' promulgated test procedures for this equipment, and
recodified the energy conservation standards so that the standards are
located contiguous with the test procedures in the Code of Federal
Regulations (CFR). 69 FR 61916, 61917. In the same final rule, DOE
incorporated by reference (see Sec. 431.75) a number of industry test
standards relevant to commercial warm air furnaces, including American
National Standards Institute (ANSI) Standard Z21.47-1998, ``Gas-Fired
Central Furnaces,'' for gas-fired furnaces, Underwriters Laboratories
(UL) Standard 727-1994, ``Standard for Safety for Oil-Fired Central
Furnaces,'' for oil-fired furnaces, provisions from Hydronics Institute
(HI) Standard BTS-2000, ``Method to Determine Efficiency of Commercial
Space Heating Boilers,'' to calculate flue loss for oil-fired furnaces,
and the American Society of Heating, Refrigerating, and Air-
conditioning Engineers (ASHRAE) Standard 103-1993, ``Method of Testing
for Annual Fuel Utilization Efficiency of Residential Central Furnaces
and Boilers,'' to determine the incremental efficiency of condensing
furnaces under steady-state conditions. Id. Then in a final rule
published in the Federal Register on May 16, 2012, DOE updated the test
procedures for commercial warm air furnaces to match the procedures
specified in ASHRAE Standard 90.1-2010, which referenced
[[Page 25629]]
ANSI Z21.47-2006, ``Gas-Fired Central Furnaces,'' for gas-fired
furnaces and UL 727-2006, ``Standard for Safety for Oil-Fired Central
Furnaces,'' for oil-fired furnaces. 77 FR 28928, 28987-88. The current
Federal energy conservation standards, for this equipment are shown in
Table 1.
Table 1--Minimum Heating Efficiency Levels for Commercial Warm Air Furnaces
----------------------------------------------------------------------------------------------------------------
Minimum thermal
Equipment type Input capacity efficiency Compliance date
level*
----------------------------------------------------------------------------------------------------------------
Gas-fired Commercial Warm Air Furnace..................... >=225,000 Btu/h 80% 1/1/1994
Oil-fired Commercial Warm Air Furnace..................... >=225,000 Btu/h 81% 1/1/1994
----------------------------------------------------------------------------------------------------------------
*At the maximum rated capacity (rated maximum input).
C. Rulemaking Process
DOE generally follows specific criteria when prescribing amended
standards for covered ``ASHRAE equipment.'' (See generally 42 U.S.C.
6313(a)(6)(A)-(C).) When proposing to adopt more-stringent standard
levels than those contained in ASHRAE Standard 90.1, DOE must evaluate
whether clear and convincing evidence exists demonstrating that such
amended standards would be technologically feasible and would result in
significant additional energy savings, and then must consider whether
amended standards are economically justified. (42 U.S.C.
6313(a)(6)(A)(ii)(II))
In assessing the appropriateness of amending the standards that are
currently in place for commercial warm air furnaces, DOE plans to
conduct its analyses in stages, with a positive result leading to a
subsequent stage of the analysis. Under this approach, DOE would first
evaluate whether more-stringent standards are technologically feasible
and would lead to significant additional energy savings. If either of
these prongs is not met, DOE would conduct no further analysis, because
the statutory criteria for adoption of the more-stringent standard
could not be met. However, if this initial assessment is positive, DOE
plans to conduct in-depth analyses of the costs and benefits of the
potential amended standards to determine whether such amended standards
would be economically justified. The analyses would include the
following steps: (1) Engineering; (2) energy use; (3) markups; (4)
life-cycle cost and payback period; and (5) national impacts. If, after
conducting those analyses, DOE reasons that there is a high likelihood
that more-stringent standards would be economically justified, DOE will
conduct downstream analyses including an analysis of: (1) Manufacturer
impacts; (2) emission impacts; (3) utility impacts; (4) employment
impacts; and (5) regulatory impacts. These analyses are the same ones
DOE routinely applies when evaluating potential energy conservation
standards for a given type of product or equipment. DOE will also
conduct several other analyses that support those previously listed,
including the market and technology assessment, the screening analysis
(which contributes to the engineering analysis), and the shipments
analysis (which contributes to the national impact analysis). As
detailed throughout this RFI, DOE is publishing this notice as the
first step in the analytical process and is specifically requesting
input and data from interested parties to aid in the development of the
technical analyses.
Due to the relatively short timeline for this rulemaking set forth
by AEMTCA, DOE anticipates moving from this RFI directly to publication
of either a determination that the commercial warm air furnaces
standards do not need to be amended or a notice of proposed rulemaking
for amended standards by the December 31, 2013 deadline.
II. Planned Rulemaking Analyses
In this section, DOE identifies a variety of issues on which it
seeks input and data in order to aid its development of the technical
and economic analyses to determine whether amended energy conservation
standards may be warranted. In addition, DOE welcomes comments on other
issues relevant to this rulemaking that may not specifically be
identified in this notice.
A. Market Assessment
The market and technology assessment provides information about the
commercial warm air furnace industry that will be used throughout the
rulemaking process. For example, this information will be used to
determine whether the existing equipment class structure requires
modification based on the statutory criteria for setting such classes
and to explore the potential for technological improvements in the
design and manufacturing of such equipment. The Department uses
qualitative and quantitative information to assess the past and present
industry structure and market characteristics. For this rulemaking, DOE
will use existing market materials and literature from a variety of
sources, including industry publications, trade journals, government
agencies, and the AHRI Directory of Certified Product Performance.\5\
Additionally, DOE will consider conducting interviews with
manufacturers to assess the overall market for commercial warm air
furnaces.
---------------------------------------------------------------------------
\5\ The AHRI Directory can be found at: https://www.ahridirectory.org/ahridirectory/pages/home.aspx (Last accessed
on April 11, 2013).
---------------------------------------------------------------------------
The current standards for commercial warm air furnaces are
specified for two equipment classes which are characterized by fuel
type--(1) gas-fired commercial warm air furnaces with capacity of
225,000 Btu per hour or more and (2) oil-fired commercial warm air
furnaces with capacity of 225,000 Btu per hour or more. As a starting
point, DOE plans to use the existing equipment class structure.
However, DOE will consider additional equipment classes for capacities
or other performance-related features that inherently effect efficiency
and justify the establishment of a different energy conservation
standard. For instance, DOE may consider adopting equipment classes to
differentiate between weatherized and non-weatherized commercial warm
air furnaces, or DOE might also consider creating an equipment class
for three-phase equipment with an input capacity less than 225,000 Btu/
h. Each of these potential new equipment classes, and the rationale
therefore, are discussed immediately below.
1. Potential New Product Classes
a. Weatherized and Non-Weatherized Commercial Furnaces
Based on a preliminary review of the commercial furnace market, DOE
understands that almost all commercial warm air furnaces are installed
outdoors on rooftops, but there is a very small segment of the
commercial warm air furnace market that consists of units installed
indoors. These indoor
[[Page 25630]]
commercial warm air furnace models appear to consist of all the oil-
fired furnace models on the market and a few gas-fired furnace models.
One of the indoor gas-fired model lines utilizes condensing heat
exchanger technology to achieve a thermal efficiency of 90 percent.
Installation location (i.e., indoors or outdoors) is significant,
because it relates to the risk of condensate freezing. If the outdoor
ambient temperature falls below freezing, the condensate can freeze and
cause a backflow of condensate into the furnace's internal components
and damage them. Although use of condensing technology may be possible
in outdoor weatherized furnaces (see section II.B.1 for further
discussion), condensing, non-weatherized heat exchanger technology has
been demonstrated as technologically feasible for indoor applications
in both the residential and commercial furnace markets. Condensing heat
exchanger technology is easier to employ on non-weatherized furnaces,
because they are installed indoors and there is little to no risk of
condensate freezing since the appliance will be installed in or
adjacent to a conditioned space. Even indoor furnaces installed in non-
conditioned spaces have minimal chances of freezing in comparison to
units that are completely outdoors, because they can be insulated from
outdoor conditions. Thus, if indoor, non-weatherized commercial warm
air furnace units were separated from outdoor, weatherized units in a
new equipment class, there would be the potential for additional energy
savings by utilizing condensing heat exchanger technology.
Consequently, DOE has tentatively concluded that this is a performance-
related feature that may justify separate equipment classes for these
types of equipment.
Issue 1: DOE requests comment on the potential energy savings in
creating a separate equipment classes for non-weatherized, indoor
commercial warm air furnaces and weatherized, outdoor commercial warm
air furnaces. DOE is also interested in learning about existing
equipment that fall into this potential equipment class, as well as the
market penetration of such equipment.
b. Three-Phase Equipment With an Input Capacity Less Than 225,000 Btu/h
EPCA defines a commercial ``warm air furnace'' as ``a self-
contained oil- or gas-fired furnace designed to supply heated air
through ducts to spaces that require it and includes combination warm
air furnace/electric air conditioning units but does not include unit
heaters and duct furnaces.'' (42 U.S.C. 6311(11)(A)) DOE notes that
EPCA itself does not place a limit on the input capacity, specify a
current phase type (single-phase or three-phase), or include any other
similar criteria in the statutory definition that would restrict the
scope of commercial warm air furnaces as covered equipment. However,
when promulgating EPCA's initial energy conservation standards for
commercial warm air furnaces, Congress only included energy
conservation standards for commercial warm air furnaces with input
ratings of 225,000 Btu/h or more. In light of the above, when
establishing its regulations for commercial warm air furnaces in the
CFR, DOE reiterated EPCA's definition of a ``warm air furnace'' and
further defined a ``commercial warm air furnace'' as ``a warm air
furnace that is industrial equipment, and that has a capacity (rated
maximum input) of 225,000 Btu per hour or more'' at 10 CFR 431.72.
However, DOE is open to considering energy conservation standards for
commercial warm air furnaces of different capacities as part of this
rulemaking to consider amended standards.
EPCA and the CFR define a residential ``furnace'' as ``a product
which utilizes only single-phase electric current, or single-phase
electric current or DC current in conjunction with natural gas,
propane, or home heating oil, and which--
(a) Is designed to be the principal heating source for the living
space of a residence;
(b) Is not contained within the same cabinet with a central air
conditioner whose rated cooling capacity is above 65,000 Btu per hour;
(c) Is an electric central furnace, electric boiler, forced-air
central furnace, gravity central furnace, or low pressure steam or hot
water boiler; and
(d) Has a heat input rate of less than 300,000 Btu per hour for
electric boilers and low pressure steam or hot water boilers and less
than 225,000 Btu per hour for forced-air central furnaces, gravity
central furnaces, and electric central furnaces, gravity central
furnaces, and electric central furnaces.''
(42 U.S.C 6291(23); 10 CFR 430.2)
Currently, DOE has promulgated energy conservation standards for
commercial warm air furnaces (single-phase or three-phase) with an
input greater than or equal 225,000 Btu/h (10 CFR 431.77), as well as
standards for residential (single-phase) furnaces with an input less
than 225,000 Btu/h (10 CFR 430.32(e)). Thus, there are presently no
energy conservation standards for commercial three-phase warm air
furnaces with an input capacity less than 225,000 Btu/h.
Commercial warm air furnaces are ``ASHRAE equipment,'' for which
EPCA requires that DOE maintain efficiency standards at the efficiency
levels set in ASHRAE Standard 90.1 or more-stringent levels. (42 U.S.C.
6313(a)(6)(A)) That is, if ASHRAE amends any efficiency level with
respect to the equipment in ASHRAE Standard 90.1, DOE must either adopt
that efficiency level or determine, with the support of clear and
convincing evidence, that a more-stringent standard is warranted. Id.
ASHRAE Standard 90.1-2010 lists efficiency levels for three-phase warm
air furnaces in Table 6.8.1E, including for those with an input
capacity less than 225,000 Btu/h. However, ASHRAE sets the efficiency
level for warm air furnaces with an input capacity less than 225,000
Btu/h as a choice between 78 percent AFUE or 80 percent thermal
efficiency for units that are not covered by DOE's standards for
residential furnaces. The 78 percent AFUE rating is the current Federal
efficiency standard for residential furnaces, and the 80 percent
thermal efficiency rating is the current Federal efficiency standard
for commercial gas-fired warm air furnaces.
Some residential furnace manufacturers offer both single-phase and
three-phase versions of their furnaces, which appear (based on a review
of product literature) to be otherwise exactly the same. Based on a
review of market data, DOE notes that these three-phase furnaces are
typically weatherized (i.e., outdoor) units that generally have the
same efficiency as their single-phase counterpart. In other cases,
especially for three-phase furnaces paired with rooftop air-
conditioning units with a cooling capacity greater than 5 tons, there
are no single-phase counterparts. However, all of these models have a
thermal efficiency of at least 80 percent, meeting or exceeding the
current Federal efficiency standards for commercial warm air furnaces.
DOE notes that this rulemaking presents somewhat unique
circumstances, namely where ASHRAE in the past had acted to adopt
standards in ASHRAE Standard 90.1 for commercial warm air furnaces with
an input capacity less than 225,000 Btu/h but DOE did not consider
itself triggered at that time. The new statutory 6-year look-back
review provisions for ASHRAE equipment (as codified at 42 U.S.C.
6313(a)(6)(C)(i) and (vi)) direct DOE to evaluate amended standards,
[[Page 25631]]
assuming that DOE has already been triggered and set a standard at a
level no less than the ASHRAE level for the equipment in question. In
this case, if DOE does not find that clear and convincing evidence
exists to support adoption of a more-stringent standard, DOE will adopt
one of the standard levels in ASHRAE Standard 90.1 as the Federal
standard (AFUE or thermal efficiency).
Issue 2: DOE requests comment on the need to establish an equipment
class for three-phase commercial warm air furnaces with an input
capacity less than 225,000 Btu/h and the potential energy savings that
could be achieved from creating such an equipment class.
Issue 3: DOE also requests comment on whether AFUE or thermal
efficiency is an appropriate efficiency metric for three-phase
commercial warm air furnaces with an input capacity less than 225,000
Btu/h.
B. Engineering Analysis
The engineering analysis estimates the cost-efficiency relationship
of equipment at different levels of increased energy efficiency. This
relationship serves as the basis for the cost-benefit calculations for
commercial customers, manufacturers, and the Nation. In determining the
cost-efficiency relationship, DOE will estimate the increase in
manufacturer cost associated with increasing the efficiency of
equipment above the baseline at various efficiency levels up to the
maximum technologically feasible (``max-tech'') efficiency level for
each equipment class. The baseline model is used as a reference point
for each equipment class in the engineering analysis and the life-cycle
cost and payback-period analyses. Typically, DOE would consider
equipment that just meets the minimum energy conservation standard as
baseline equipment. The vast majority of commercial warm air furnaces
on the market achieve thermal efficiency ratings between 80 percent
(the minimum efficiency standard) and 82 percent, inclusively, with two
model lines achieving a thermal efficiency rating of 90 percent. In
this engineering analysis, DOE is planning on analyzing the technology
options and cost for equipment at 80 percent, 82 percent, and 90
percent thermal efficiencies.
Issue 4: DOE requests information on max-tech efficiency levels
achievable in the current market.
Issue 5: DOE requests feedback on its proposed efficiency levels
for analysis.
Issue 6: DOE requests information regarding the technology
differences between commercial furnaces at 80 percent thermal
efficiency ratings and more-efficient commercial furnaces.
In order to determine the cost-efficiency relationship, DOE
anticipates drawing upon a variety of resources. DOE will use knowledge
gained from previous rulemakings for similar equipment and consult
manufacturers, technical experts, and product literature to estimate
the cost of equipment with increased efficiency. DOE may also use
reverse-engineering (or cost-assessment) techniques that include
teardown analysis to assist in determining the cost-efficiency
relationship. A teardown analysis (or ``physical teardown'') determines
the production cost of a piece of equipment by disassembling the
equipment ``piece-by-piece'' and estimating the material and labor cost
of each component. The information from teardowns is then inputted into
a cost model which fully accounts for labor, material, overhead, and
depreciation to develop an estimate of the total manufacturer
production cost (MPC). A supplementary method called a catalog teardown
(or ``virtual teardown'') uses published manufacturer catalogs and
supplementary component data to estimate the major physical differences
between a piece of equipment that has been physically disassembled and
another piece of similar equipment. These two methods could be used
individually or in combination to help DOE determine the cost-
efficiency relationship for commercial warm air furnaces. If DOE finds
that sufficient information exists, based on previous analyses of
similar products and in manufacturer literature and information, to
estimate the costs using virtual teardowns in lieu of physical
teardowns, DOE may choose to use only virtual teardowns, an approach
which would yield the necessary information while saving time and
resources.
Issue 7: DOE requests feedback on the possible approaches
identified for the engineering analysis and on what the appropriate
representative capacities and characteristics would be for each
equipment class.
1. Condensing Weatherized Commercial Warm Air Furnaces
As briefly discussed in section II.A.1.a above, furnaces that
utilize condensing heat exchanger technology extract more useable heat
from the flue gas via a secondary heat exchanger. This extra heat
extraction can cause water vapor to condense from the gas, hence the
term ``condensing furnace.'' This technology has not become established
in the commercial warm air furnace market because of challenges
associated with removing acidic condensate from units installed
outdoors, which is the majority of the commercial warm air furnace
market. When the outdoor ambient temperature falls below freezing, the
condensate leaving the drain pipe can freeze and cause a backflow of
condensate into the furnace's internal components which can permanently
damage the furnace, creating reliability issues. If the furnace becomes
disabled while the outdoor ambient temperatures are below freezing and
if the furnace is not repaired or replaced in a timely fashion, there
could be a danger to building occupants due to exposure to low
temperatures. Also, because this condensate is acidic, it may need to
be treated with a neutralizer before discharging it into a sewer
system, according to some local codes.
In researching the potential for rooftop condensate disposal
methods, DOE identified two patents from major manufacturers that
provided methods for condensate disposal in outdoor furnaces. DOE is
also aware of one manufacturer that markets a dedicated outdoor air
system with an optional heating section that utilizes a condensing heat
exchanger to achieve a thermal efficiency over 90 percent, and which
drains the condensate into the heated building space to prevent
condensate freezing. The manufacturer also recommends completely
draining the condensate drain system and secondary heat exchanger or
applying heat tape to the drain system in order to prevent condensate
freezing. DOE tentatively plans to examine condensing heat exchangers
as a viable technology option for improving the thermal efficiency of
commercial furnaces and analyze it as part of the engineering analysis.
Issue 8: DOE requests comment on the feasibility of using
condensing heat exchanger technology in weatherized commercial warm air
furnaces. DOE is also interested in comments on issues related to
implementing identified condensing heat exchanger technologies in
outdoor warm air furnaces, as well as costs associated with
implementing a condensate drain into the building's space.
C. Markups Analysis
To carry out the life-cycle cost (LCC) and payback period (PBP)
calculations, DOE needs to determine the cost to the commercial
customer of baseline equipment that satisfies the currently applicable
standards, and the cost of the more-efficient unit the customer would
purchase under potential amended standards. This is done by applying a
markup multiplier to the manufacturer's
[[Page 25632]]
selling price to estimate the commercial customer's price.
DOE intends to characterize several types of distribution channels
to describe how the equipment passes from the manufacturer to the
customer. The first distribution channel is characterized as follows:
Manufacturer >< Wholesaler
>< Mechanical contractor
>< General contractor
>< Consumer
In the second distribution channel, the manufacturer sells the
equipment directly to the customer through a national account, which is
characterized as follows:
Manufacturer >< Consumer
In addition, DOE plans to consider cases when the contractor's sale
of the equipment includes a start-up/check-out contract, in which cases
the equipment markup is included in the contract costs.
Issue 9: DOE seeks input from stakeholders on whether the
distribution channels described above are relevant for commercial warm
air furnaces.
Issue 10: DOE seeks input on the percentage of equipment being
distributed through the various types of distribution channels, and
whether the share of equipment through each channel varies based on
equipment capacity.
To develop markups for the parties involved in the distribution of
the equipment, DOE utilized several sources including: (1) The Heating,
Air-Conditioning & Refrigeration Distributors International (HARDI)
2012 Profit Report\6\ to develop wholesaler markups, (2) the 2005 Air
Conditioning Contractors of America's (ACCA) financial analysis for the
heating, ventilation, air-conditioning, and refrigeration (HVACR)
contracting industry \7\ to develop mechanical contractor markups, and
(3) U.S. Census Bureau's 2007 Economic Census data \8\ for the
commercial and institutional building construction industry to develop
general contractor markups.
---------------------------------------------------------------------------
\6\ Heating, Air Conditioning & Refrigeration Distributors
International 2012 Profit Report (Available at: https://www.hardinet.org/Profit-Report) (Last accessed April 10, 2013).
\7\ Air Conditioning Contractors of America (ACCA), Financial
Analysis for the HVACR Contracting Industry: 2005 (2005) (Available
at: https://https://www.acca.org/store/product.php?pid=142) (Last
accessed April 10, 2013).
\8\ U.S. Census Bureau, 2007 Economic Census Data (2007)
(Available at: https://www.census.gov/econ/) (Last accessed April 10,
2013).
---------------------------------------------------------------------------
Issue 11: DOE seeks recent data to establish the markups for the
parties involved with the distribution of the equipment.
D. Energy Use Analysis
The purpose of the energy use analysis is to assess the energy
requirements of equipment at different efficiencies in several building
types that utilize the equipment. DOE intends to base the energy use
analysis for the current effort on building simulation data or bin
method. The building simulation will include building operation hourly
profiles, which are based on building characteristics from the Energy
Information Administration's 2003 Commercial Building Energy
Consumption Survey (CBECS) \9\ for the subset that uses the type of
equipment covered by the standards. Each building will be assigned to a
specific location, and the approach will capture variability in heating
loads due to factors such as building activity, schedule, occupancy,
local weather, and shell characteristics.
---------------------------------------------------------------------------
\9\ Energy Information Administration (EIA), 2003 Commercial
Building Energy Consumption Survey (CBECS) (Available at: https://www.eia.gov/consumption/commercial/) (Last accessed April 10, 2013).
---------------------------------------------------------------------------
CBECS 2012 is currently in development but will not be available in
time for this rulemaking. In addition, the 2003 CBECS sample may not
include examples of recent innovations in building shell or window
technologies that reduce cooling loads. Therefore, DOE intends on
reviewing other data sets (e.g., the technology penetration curves used
in the latest National Energy Modeling System (NEMS) \10\), to
determine whether a significant fraction of the current building
population is not represented by CBECS 2003.
---------------------------------------------------------------------------
\10\ For more information on NEMS, refer to the U.S. Department
of Energy, Energy Information Administration (EIA) documentation. A
useful summary is National Energy Modeling System: An Overview 2003,
DOE/EIA-0581(2003). Each year, EIA uses NEMS to produce an energy
forecast for the United States, the Annual Energy Outlook (AEO). For
this analysis, DOE intends to use the version of NEMS based on AEO
2013 (Available at: https://www.eia.gov/forecasts/aeo/).
---------------------------------------------------------------------------
Issue 12: DOE requests comment or seeks input from stakeholders on
the overall method to determine the equipment load profiles;
Issue 13: DOE requests comment or seeks input from stakeholders on
the current distribution of equipment efficiencies in the building
population;
Issue 14: DOE requests comment or seeks input from stakeholders on
how equipment energy use for a given heating load shape scales as a
function of capacity (i.e., whether two commercial furnace units of a
certain capacity use the same total heating energy as one commercial
furnace unit of twice the capacity)
Issue 15: DOE requests comment or seeks input from stakeholders on
whether building simulations developed for small and large commercial
furnace equipment are applicable to very large equipment, and
Issue 16: DOE requests comment on the fraction of commercial warm
air furnaces which are used in residential applications such as
residential multi-family buildings as well as the fraction of
residential furnaces that are used for commercial applications.
E. Life-Cycle Cost and Payback Period Analysis
The purpose of the LCC and PBP analysis is to analyze the effects
of potential amended energy conservation standards on customers of
commercial furnace equipment by determining how a potential amended
standard affects their operating expenses (usually decreased) and their
total installed costs (usually increased).
DOE intends to analyze the potential for variability and
uncertainty by performing the LCC and PBP calculations on a
representative sample of individual commercial buildings. DOE plans to
utilize the sample of buildings developed for the energy use analysis
\11\ and the corresponding simulations results. Within a given
building, one or more commercial furnace units may serve the building's
space-conditioning needs, depending on the heating load requirements of
the building. As a result, the Department intends to express the LCC
and PBP results as the number of commercial furnace customers
experiencing economic impacts of different magnitudes. DOE plans to
model both the uncertainty and the variability in the inputs to the LCC
and PBP analysis using Monte Carlo simulation and probability
distributions. As a result, the LCC and PBP results will be displayed
as distributions of impacts compared to the base case conditions.
---------------------------------------------------------------------------
\11\ DOE plans to utilize the building types defined in CBECS
2003. Definitions of CBECS building types can be found at https://www.eia.gov/emeu/cbecs/building_types.html.
---------------------------------------------------------------------------
Issue 17: DOE requests comment from stakeholders on the overall
method that it intends on using to conduct the LCC and PBP analysis for
commercial warm air furnaces.
Inputs to the LCC and PBP analysis are categorized as: (1) Inputs
for establishing the purchase expense, otherwise known as the total
installed cost, and (2) inputs for calculating the operating expense.
The primary inputs for establishing the total installed cost are
the baseline
[[Page 25633]]
customer price, standard-level customer price increases, and
installation costs. Baseline customer prices and standard-level
customer price increases will be determined by applying markups to
manufacturer price estimates. The installation cost is added to the
customer price to arrive at a total installed cost. DOE intends to
develop installation costs for commercial warm air furnaces using the
most recent RS Means data available.
Issue 18: DOE seeks input on the approach and data sources it
intends to use to develop installation costs, specifically, its
intention to use the most recent RS Means Mechanical Cost Data.\12\
---------------------------------------------------------------------------
\12\ RS Means, 2013 Mechanical Cost Data (Available at: https://rsmeans.reedconstructiondata.com/60023.aspx) (Last accessed April
10, 2013).
---------------------------------------------------------------------------
The primary inputs for calculating the operating costs are
equipment energy consumption and power demand, equipment efficiency,
electricity prices and forecasts, maintenance and repair costs,
equipment lifetime, and discount rates. Both equipment lifetime and
discount rates are used to calculate the present value of future
operating expenses.
The equipment energy consumption is the site energy use associated
with providing space-heating to the building. DOE intends to utilize
calculation methodology to establish equipment energy use.
DOE intends to determine gas, oil, and electricity prices based on
recent or current tariffs from a representative sample of utilities, as
well as historical State commercial energy price data from the Energy
Information Administration (EIA). This approach calculates energy
expenses based on actual energy prices that customers are paying in
different geographical areas of the country. In addition to using
tariffs, DOE plans to use data provided in EIA's Form 861 data \13\ to
calculate commercial electricity prices, EIA's Natural Gas Navigator
\14\ to calculate commercial natural gas prices, and EIA's State Energy
Data System (SEDS) \15\ to calculate liquefied petroleum gas (LPG) and
fuel oil prices. Future energy prices will likely be projected using
trends from the EIA's 2013 Annual Energy Outlook (AEO).\16\
---------------------------------------------------------------------------
\13\ Energy Information Administration (EIA), Survey form EIA-
861--Annual Electric Power Industry Report (Available at: https://www.eia.gov/electricity/data/eia861/) (Last accessed April
15, 2013).
\14\ Energy Information Administration (EIA), Natural Gas
Navigator (Available at: https://tonto.eia.doe.gov/dnav/ng/ng_pri_sum_dcu_nus_m.htm) (Last accessed April 15, 2013).
\15\ Energy Information Administration (EIA), State Energy Data
System (SEDS) (Available at: https://www.eia.gov/state/seds/) (Last
accessed April 15, 2013).
\16\ Energy Information Administration (EIA), 2013 Annual Energy
Outlook (AEO) Full Version (Available at: https://www.eia.gov/forecasts/aeo/) (Last accessed April 15, 2013).
---------------------------------------------------------------------------
Issue 19: DOE seeks comment on its approach for developing energy
prices. DOE seeks input on specific data sources available for
collecting tariffs.
Maintenance costs are expenses associated with ensuring continued
operation of the covered equipment over time. DOE intends to develop
maintenance costs for its analysis using the most recent RS Means data
available. DOE plans also to consider the cases when the equipment is
covered by service and/or maintenance agreements.
Issue 20: DOE seeks input on the approach and data sources it
intends to use to develop maintenance costs, specifically, its
intention to use the most recent RS Means Facilities Maintenance &
Repair Cost Data,\17\ as well as to consider the cost of service and/or
maintenance agreements.
---------------------------------------------------------------------------
\17\ RS Means, 2013 Facilities Maintenance & Repair Cost Data
(Available at: https://rsmeans.reedconstructiondata.com/60303.aspx)
(Last accessed April 10, 2013).
---------------------------------------------------------------------------
Repair costs are expenses associated with repairing or replacing
components of the covered equipment that have failed. DOE intends to
assess whether repair costs vary with equipment efficiency as part of
its analysis.
Issue 21: DOE seeks comment as to whether repair costs vary as a
function of equipment efficiency. DOE also requests any data or
information on developing repair costs.
Equipment lifetime is the age at which a unit of covered equipment
is retired from service. The average equipment lifetime for commercial
warm air furnaces is estimated by ASHRAE to be between 15 and 20
years.\18\ Based on these data, DOE plans to use a 17.5 average
lifetime for commercial warm air furnaces as the primary input for
developing a Weibull probability distribution to characterize
commercial warm air furnace lifetime.
---------------------------------------------------------------------------
\18\ American Society of Heating, Refrigerating and Air-
Conditioning Engineers, Inc. (ASHRAE), ASHRAE Handbook of HVAC
Systems and Equipment (2008) p. 32.8.
---------------------------------------------------------------------------
Issue 22: DOE seeks comment on its approach of using a Weibull
probability distribution to characterize equipment lifetime. DOE also
requests any equipment lifetime data or information and whether
equipment lifetime varies based on equipment class.
The discount rate is the rate at which future expenditures are
discounted to establish their present value. DOE intends to derive the
discount rates by estimating the cost of capital of companies that
purchase commercial furnace equipment.
DOE measures LCC and PBP impacts of potential standard levels
relative to a base case that reflects the likely market in the absence
of amended standards. DOE plans to develop market-share efficiency data
(i.e., the distribution of equipment shipments by efficiency) for the
equipment classes DOE is considering, for the year in which compliance
with any amended standards would be required.
DOE also plans to assess the applicability of the ``rebound
effect'' in the energy use analysis for commercial warm air furnaces. A
rebound effect occurs when a piece of equipment that is made more
efficient is used more intensively, so that the expected energy savings
from the efficiency improvement may not fully materialize. However, at
this time, DOE is not aware of any information about the rebound effect
for this equipment type.
Issue 23: DOE requests data on current efficiency market shares (of
shipments) by equipment class, and also similar historic data. In
particular, DOE seeks efficiency data for very large equipment.
Issue 24: DOE also requests information on expected trends in
efficiency for commercial warm air furnaces over the next five years.
Issue 25: DOE seeks comments and data on the rebound effect that
may be associated with more-efficient commercial warm air furnaces.
F. Shipment Analysis
DOE uses shipment projections by equipment class to calculate the
national impacts of standards on energy consumption, net present value
(NPV), and future manufacturer cash flows.
DOE intends to develop a shipments model for commercial warm air
furnace equipment driven by historical shipments data. The accuracy of
the shipments model is highly dependent on these historical shipments
data, as the data are used not only to build up an equipment stock but
also to calibrate the shipments model. If no shipments data are
available, DOE plans to consider using 1994 shipments data from the Gas
Appliance Manufacturers Association \19\ (GAMA) (i.e., 164,300
commercial warm air gas-fired furnace shipments),\20\ and applying a
trend
[[Page 25634]]
based on estimated historical commercial warm air furnace stock derived
from CBECS data.
---------------------------------------------------------------------------
\19\ This organization has subsequently become the Air-
Conditioning, Heating, and Refrigeration Institute (AHRI).
\20\ Pacific Northwest National Laboratory (PNNL), Screening
Analysis for EPACT-Covered Commercial HVAC and Water-Heating
Equipment (April 2000) (Available at: https://www.pnl.gov/main/publications/external/technical_reports/PNNL-13232.pdf) (Last
accessed April 10, 2013).
---------------------------------------------------------------------------
Issue 26: DOE seeks historical shipments data for commercial warm
air furnaces.
The shipments model will consider three market segments: (1) New
commercial buildings acquiring equipment; (2) existing buildings
replacing old equipment; and (3) existing buildings acquiring new
equipment for the first time. Two stock categories are also considered:
(1) equipment that has received only normal maintenance repairs; and
(2) equipment that has had its useful life extended through additional
repairs. To determine whether a customer would choose to repair rather
than replace their commercial furnace equipment, the shipments model
explicitly accounts for the combined effects of changes in purchase
price, annual operating cost, and the value of commercial floor space
on the purchase versus repair decision. Changes to the purchase price
and operating costs due to amended energy conservation standards were
the drivers for shipment estimates for the standards cases relative to
the base case (i.e., the case without amended standards).
Issue 27: DOE requests comment on the approach it intends on using
to develop the shipments model and shipments forecasts for this
rulemaking.
DOE intends to utilize the U.S. Census Bureau data \21\ to
establish historical new construction floor space, as well as
historical stock floor space. The Annual Energy Outlook will be used to
forecast both new construction and stock floor space. Together with
historical equipment saturation data from CBECS, DOE will estimate
shipments to the three market segments identified above. The utility
function to estimate the repair versus replacement decision will be
based on income per square foot data from the Building Owners and
Managers Association (BOMA) Commercial Building Survey reports,\22\
purchase price data estimated from the Bureau of Labor Statistics,\23\
and operating cost data derived from the LCC and PBP analysis.
---------------------------------------------------------------------------
\21\ U.S. Census Bureau, Statistical Abstract of the United
States: 2011, Table No 933--Construction Contracts--Value of
Construction and Floor Space of Buildings by Class of Construction
(Available at: https://www.census.gov/compendia/statab/2011/cats/construction_housing/construction_indices_and_value.html) (Last
accessed April 10, 2013).
\22\ Building Owners and Managers Association International
(BOMA). Experience Exchange Report (2013) (Available at: https://www.bomaeer.com/) (Last accessed April 10, 2013).
\23\ U.S. Department of Labor, Bureau of Labor Statistics.
Producers Price Index: Industry: Refrigeration and Heating Equipment
(Available at: https://www.bls.gov/ppi/home.htm) (Last accessed April
10, 2013).
---------------------------------------------------------------------------
Issue 28: DOE seeks input on the approach and data sources it
intends to use in developing the shipments model and shipments
forecasts for this analysis.
G. National Impact Analysis
The purpose of the national impact analysis (NIA) is to estimate
aggregate impacts of potential energy conservation standards at the
national level. Impacts that DOE reports include the national energy
savings (NES) from potential standards and the net present value (NPV)
of the total consumer benefits.
To develop the NES, DOE calculates annual energy consumption for
the base case and the standards cases. DOE calculates the annual energy
consumption using per-unit annual energy use data multiplied by
projected shipments.
To develop the national NPV of consumer benefits from potential
energy conservation standards, DOE calculates annual energy
expenditures and annual equipment expenditures for the base case and
the standards cases. DOE calculates annual energy expenditures from
annual energy consumption by incorporating forecasted energy prices,
using shipment projections and average energy efficiency projections.
DOE calculates annual equipment expenditures by multiplying the price
per unit times the projected shipments. The difference each year
between energy bill savings and increased equipment expenditures is the
net savings or net costs.
A key component of DOE's estimates of NES and NPV are the equipment
energy efficiencies forecasted over time for the base case and for each
of the standards cases. To develop the various standards cases, DOE
plans to develop market-share efficiency data (i.e., data on the
distribution of equipment shipments by efficiency) for the commercial
furnace equipment classes DOE is considering. To estimate the impact
that amended energy conservation standards may have in the year
compliance becomes required, DOE has used ``roll-up'' and/or ``shift''
scenarios in its standards rulemakings. Under the ``roll-up'' scenario,
DOE assumes: (1) Equipment efficiencies in the base case that do not
meet the new or amended standard level under consideration would ``roll
up'' to meet that standard level; and (2) equipment shipments at
efficiencies above the standard level under consideration would not be
affected. Under the ``shift'' scenario, DOE retains the pattern of the
base-case efficiency distribution but re-orients the distribution at
and above the new or amended minimum energy conservation standard.
After DOE establishes the average efficiency for the assumed compliance
date of a standard, it can estimate future efficiency by using the same
rate of projected efficiency growth as for the base-case efficiency
trend.
DOE intends to determine whether there is a rebound effect
associated with more efficient commercial furnaces. If data indicate
that there is a rebound effect, DOE will account for the rebound effect
in its calculation of NES.
DOE has historically presented NES in terms of primary energy
savings. On August 18, 2011, DOE published a final statement of policy
in the Federal Register announcing its intention to use full-fuel-cycle
(FFC) measures of energy use and greenhouse gas and other emissions in
the national impact analyses and emissions analyses included in future
energy conservation standards rulemakings. 76 FR 51281. While DOE
stated in that notice that it intended to use the Greenhouse Gases,
Regulated Emissions, and Energy Use in Transportation (GREET) model to
conduct the analysis, it also said it would review alternative methods,
including the use of NEMS. After evaluating both models and the
approaches discussed in the August 18, 2011 notice, DOE published an
amended statement of policy, articulating its determination that NEMS
is a more appropriate tool for this purpose. 77 FR 49701 (Aug. 17,
2012). Therefore, DOE intends to use the NEMS model to conduct FFC
analyses. The method used to derive the FFC multipliers will be
described in the technical support document (TSD).
Issue 29: In addition to historical efficiency data, DOE also
requests information on expected trends in efficiency of commercial
warm air furnaces over the long run.
Issue 30: DOE requests comment on whether it should pursue a roll-
up or shift approach for potential commercial warm air furnace
standards in the national impact analysis.
III. Public Participation
DOE invites all interested parties to submit in writing by June 3,
2013, comments and information on matters addressed in this notice and
on any other matters relevant to DOE's consideration of potential
amended energy conservation standards for commercial warm air furnaces.
[[Page 25635]]
After the close of the comment period, DOE will begin collecting
data, conducting the analyses, and reviewing the public comments. These
actions will be taken to aid in the development of a notice of proposed
rulemaking (NOPR) for commercial warm air furnaces, if DOE determines
that the statutory criteria have been met for amended energy
conservation standards for such equipment.
Instructions: All submissions received must include the agency name
and docket number and/or RIN for this rulemaking. No telefacsimilies
(faxes) will be accepted.
Docket: The docket is available for review at www.regulations.gov,
including Federal Register notices, public meeting attendees' lists and
transcripts, comments, and other supporting documents/materials. All
documents in the docket are listed in the www.regulations.gov index.
However, not all documents listed in the index may be publicly
available, such as information that is exempt from public disclosure.
A link to the docket Web page can be found at: https://www.regulations.gov/#!docketDetail;D=EERE-2013-BT-STD-0021. This Web
page contains a link to the docket for this notice on the
www.regulations.gov Web site. The www.regulations.gov Web page contains
simple instructions on how to access all documents, including public
comments, in the docket.
For information on how to submit a comment, review other public
comments and the docket, or participate in the public meeting, contact
Ms. Brenda Edwards at (202) 586-2945 or by email:
Brenda.Edwards@ee.doe.gov.
DOE considers public participation to be a very important part of
the process for amending energy conservation standards. DOE actively
encourages the participation and interaction of the public during the
comment period in each stage of the rulemaking process. Interactions
with and between members of the public provide a balanced discussion of
the issues and assist DOE in the rulemaking process. Anyone who wishes
to be added to the DOE mailing list to receive future notices and
information about this rulemaking should contact Ms. Brenda Edwards at
(202) 586-2945, or via email at Brenda.Edwards@ee.doe.gov.
Issued in Washington, DC, on April 26, 2013.
Kathleen B. Hogan,
Deputy Assistant Secretary for Energy Efficiency, Energy Efficiency and
Renewable Energy.
[FR Doc. 2013-10388 Filed 5-1-13; 8:45 am]
BILLING CODE 6450-01-P