Energy Conservation Program: Energy Conservation Standards for Automatic Commercial Ice Makers, 14845-14950 [2014-05566]
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Vol. 79
Monday,
No. 51
March 17, 2014
Part IV
Department of Energy
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10 CFR Part 431
Energy Conservation Program: Energy Conservation Standards for
Automatic Commercial Ice Makers; Proposed Rule
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Federal Register / Vol. 79, No. 51 / Monday, March 17, 2014 / Proposed Rules
DEPARTMENT OF ENERGY
10 CFR Part 431
[Docket Number EERE–2010–BT–STD–
0037]
RIN 1904–AC39
Energy Conservation Program: Energy
Conservation Standards for Automatic
Commercial Ice Makers
Office of Energy Efficiency and
Renewable Energy, Department of
Energy.
ACTION: Notice of proposed rulemaking
and public meeting.
AGENCY:
The Energy Policy and
Conservation Act of 1975 (EPCA), as
amended, prescribes energy
conservation standards for various
consumer products and certain
commercial and industrial equipment,
including automatic commercial ice
makers (ACIM). EPCA also requires the
U.S. Department of Energy (DOE) to
determine whether more-stringent,
amended standards would be
technologically feasible and
economically justified, and would save
a significant amount of energy. In this
notice, DOE proposes amended energy
conservation standards for automatic
commercial ice makers. The notice of
proposed rulemaking also announces a
public meeting to receive comment on
these proposed standards and associated
analyses and results.
DATES: DOE will accept comments, data,
and information regarding this notice of
proposed rulemaking (NOPR) before and
after the public meeting, but no later
than May 16, 2014. See section VII,
‘‘Public Participation,’’ for details.
DOE will hold a public meeting on
Monday, April 14, 2014, from 9 a.m. to
4 p.m., in Washington, DC. The meeting
will also be broadcast as a webinar. See
section VII, ‘‘Public Participation,’’ for
webinar registration information,
participant instructions, and
information about the capabilities
available to webinar participants.
ADDRESSES: The public meeting will be
held at the U.S. Department of Energy,
Forrestal Building, Room 8E–089, 1000
Independence Avenue SW.,
Washington, DC 20585. To attend,
please notify Ms. Brenda Edwards at
(202) 586–2945. Persons can attend the
public meeting via webinar. For more
information, refer to section VII, ‘‘Public
Participation.’’
Any comments submitted must
identify the NOPR for Energy
Conservation Standards for Automatic
Commercial Ice Makers and provide
docket number EERE–2010–BT–STD–
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SUMMARY:
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0037 and/or regulatory information
number (RIN) 1904–AC39. Comments
may be submitted using any of the
following methods:
1. Federal eRulemaking Portal:
www.regulations.gov. Follow the
instructions for submitting comments.
2. Email: ACIM-2010-STD-0037@
ee.doe.gov. Include the docket number
and/or RIN in the subject line of the
message.
3. 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
CD. It is not necessary to include
printed copies.
4. Hand Delivery/Courier: Ms. Brenda
Edwards, U.S. Department of Energy,
Building Technologies Program, 950
L’Enfant Plaza SW., Suite 600,
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.
Written comments regarding the
burden-hour estimates or other aspects
of the collection-of-information
requirements contained in this proposed
rule may be submitted to Office of
Energy Efficiency and Renewable
Energy through the methods listed
above and by email to Chad_S_
Whiteman@omb.eop.gov.
For detailed instructions on
submitting comments and additional
information on the rulemaking process,
see section VII of this document (Public
Participation).
Docket: The docket, which includes
Federal Register notices, public meeting
attendee lists and transcripts,
comments, and other supporting
documents/materials, is available for
review at regulations.gov. All
documents in the docket are listed in
the regulations.gov index. However,
some documents listed in the index,
such as those containing information
that is exempt from public disclosure,
may not be publicly available.
The link to the docket Web page is the
following: www.regulations.gov/#
!docketBrowser;rpp=25;po=0;D=EERE2010-BT-STD-0037. This Web page will
contain a link to the docket for this
proposed rule on the regulations.gov
site. The regulations.gov Web page will
contain simple instructions on how to
access all documents, including public
comments, in the docket. See section VII
for further information on how to
submit comments through
www.regulations.gov.
For further information on how to
submit a comment, review other public
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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.
FOR FURTHER INFORMATION CONTACT: Mr.
John Cymbalsky, U.S. Department of
Energy, Office of Energy Efficiency and
Renewable Energy, Building
Technologies Program, EE–2B, 1000
Independence Avenue SW.,
Washington, DC 20585–0121.
Telephone: (202) 287–1692. Email:
automatic_commercial_ice_makers@
ee.doe.gov.
Mr. Ari Altman, U.S. Department of
Energy, Office of the General Counsel,
GC–71, 1000 Independence Avenue
SW., Washington, DC 20585–0121.
Telephone: (202) 287–6307. Email:
Ari.Altman@hq.doe.gov.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Summary of the Proposed Rule
A. Benefits and Costs to Customers
B. Impact on Manufacturers
C. National Benefits
II. Introduction
A. Authority
B. Background
1. Current Standards
2. History of Standards Rulemaking for
Automatic Commercial Ice Makers
III. General Discussion
A. List of Equipment Class Abbreviations
B. Test Procedures
C. Technological Feasibility
1. General
2. Maximum Technologically Feasible
Levels
D. Energy and Water Savings
1. Determination of Savings
2. Significance of Savings
E. Economic Justification
1. Specific Criteria
a. Economic Impact on Manufacturers and
Commercial Customers
b. Life-Cycle Costs
c. Energy Savings
d. Lessening of Utility or Performance of
Equipment
e. Impact of Any Lessening of Competition
f. Need of the Nation To Conserve Energy
g. Other Factors
2. Rebuttable Presumption
IV. Methodology and Discussion of
Comments
A. General Rulemaking Issues
1. Statutory Authority
2. Test Procedures
3. Need for and Scope of Rulemaking
B. Market and Technology Assessment
1. Equipment Classes
a. Cabinet Size
b. Large-Capacity Batch Ice Makers
c. Efficiency/Harvest Capacity Relationship
d. Continuous Ice Maker Equipment
Classes
e. Remote Condensing Unit Classes for
Equipment With and Without Remote
Compressors
f. Remote to Rack Equipment
g. Ice Makers Covered by the Energy Policy
Act of 2005
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h. Regulation of Potable Water Use
2. Technology Assessment
a. Reduced Potable Water Flow for
Continuous Type Ice Makers
b. Alternative Refrigerants
C. Screening Analysis
a. Tube Evaporator Design
b. Low Thermal Mass Evaporator Design
c. Drain Water Heat Exchanger
d. Design Options That Necessitate
Increased Cabinet Size
e. Microchannel Heat Exchangers
f. Smart Technologies
g. Screening Analysis: General Comments
D. Engineering Analysis
1. Representative Equipment for Analysis
2. Efficiency Levels
a. Baseline Efficiency Levels
b. Incremental Efficiency Levels
c. IMH–A–Large–B Treatment
d. Maximum Available Efficiency
Equipment
e. Maximum Technologically Feasible
Efficiency Levels
f. Comment Discussion
3. Design Options
a. Improved Condenser Performance in
Batch Equipment
b. Harvest Capacity Oversizing
c. Open-Loop Condensing Water Designs
d. Condenser Water Flow
e. Compressors
4. Development of the Cost-Efficiency
Relationship
a. Manufacturing Cost
b. Energy Consumption Model
c. Retail Cost Review
d. Design, Development, and Testing Costs
e. Empirical-Based Analysis
f. Revision of Preliminary Engineering
Analysis
E. Markups Analysis
F. Energy Use Analysis
G. Life-Cycle Cost and Payback Period
Analysis
1. Equipment Cost
2. Installation, Maintenance, and Repair
Costs
a. Installation Costs
b. Repair and Maintenance Costs
3. Annual Energy and Water Consumption
4. Energy Prices
5. Energy Price Projections
6. Water Prices
7. Discount Rates
8. Lifetime
9. Compliance Date of Standards
10. Base-Case and Standards-Case
Efficiency Distributions
11. Inputs to Payback Period Analysis
12. Rebuttable Presumption Payback
Period
H. National Impact Analysis—National
Energy Savings and Net Present Value
1. Shipments
2. Forecasted Efficiency in the Base Case
and Standards Cases
3. National Energy Savings
4. Net Present Value of Customer Benefit
I. Customer Subgroup Analysis
J. Manufacturer Impact Analysis
1. Overview
2. Government Regulatory Impact Model
a. Government Regulatory Impact Model
Key Inputs
b. Government Regulatory Impact Model
Scenarios
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3. Discussion of Comments
a. Impact to Suppliers, Distributors,
Dealers, and Contractors
b. ENERGY STAR
c. Cumulative Regulatory Burden
d. Small Manufacturers
4. Manufacturer Interviews
a. Price Sensitivity
b. Enforcement
c. Reliability Impacts
d. Impact on Innovation
K. Emissions Analysis
L. Monetizing Carbon Dioxide and Other
Emissions Impacts
1. Social Cost of Carbon
a. Monetizing Carbon Dioxide Emissions
b. Social Cost of Carbon Values Used in
Past Regulatory Analyses
c. Current Approach and Key Assumptions
2. Valuation of Other Emissions
Reductions
M. Utility Impact Analysis
N. Employment Impact Analysis
O. Regulatory Impact Analysis
V. Analytical Results
A. Trial Standard Levels
1. Trial Standard Level Formulation
Process and Criteria
2. Trial Standard Level Equations
B. Economic Justification and Energy
Savings
1. Economic Impacts on Commercial
Customers
a. Life-Cycle Cost and Payback Period
b. Life-Cycle Cost Subgroup Analysis
2. Economic Impacts on Manufacturers
a. Industry Cash Flow Analysis Results
b. Impacts on Direct Employment
c. Impacts on Manufacturing Capacity
d. Impacts on Subgroups of Manufacturers
e. Cumulative Regulatory Burden
3. National Impact Analysis
a. Amount and Significance of Energy
Savings
b. Net Present Value of Customer Costs and
Benefits
c. Water Savings
d. Employment Impacts
4. Impact on Utility or Performance of
Equipment
5. Impact of Any Lessening of Competition
6. Need of the Nation To Conserve Energy
7. Other Factors
C. Proposed Standard
VI. Procedural Issues and Regulatory Review
A. Review Under Executive Orders 12866
and 13563
B. Review Under the Regulatory Flexibility
Act
1. Description and Estimated Number of
Small Entities Regulated
2. Description and Estimate of Compliance
Requirements
3. Duplication, Overlap, and Conflict With
Other Rules and Regulations
4. Significant Alternatives to the Rule
C. Review Under the Paperwork Reduction
Act
D. Review Under the National
Environmental Policy Act of 1969
E. Review Under Executive Order 13132
F. Review Under Executive Order 12988
G. Review Under the Unfunded Mandates
Reform Act of 1995
H. Review Under the Treasury and General
Government Appropriations Act, 1999
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I. Review Under Executive Order 12630
J. Review Under the Treasury and General
Government Appropriations Act, 2001
K. Review Under Executive Order 13211
L. Review Under the Information Quality
Bulletin for Peer Review
VII. Public Participation
A. Attendance at the Public Meeting
B. Procedure for Submitting Prepared
General Statements for Distribution
C. Conduct of the Public Meeting
D. Submission of Comments
E. Issues on Which DOE Seeks Comment
1. Standards Compliance Dates
2. Utilization Factors
3. Baseline Efficiency
4. Screening Analysis
DOE considered whether design options
were technologically feasible; practicable
to manufacture, install, or service; had
adverse impacts on product utility or
product availability; or had adverse
impacts on health or safety. See Section
IV.C of today’s NOPR and chapter 4 of
the NOPR TSD for further discussion of
the screening analysis.
5. Maximum Technologically Feasible
Levels
DOE seeks comments on the Maximum
Technologically Feasible levels proposed
in Table III.2 and Table III.3 of today’s
notice. More discussion on this topic can
be found in Section IV.D.2.e of today’s
NOPR.
6. Markups To Determine Price
7. Equipment Life
8. Installation Costs
9. Open- Versus Closed-Loop Installations
10. Ice Maker Shipments by Type of
Equipment
11. Intermittency of Manufacturer R&D and
Impact of Standards
12. INPV Results and Impact of Standards
13. Small Businesses
14. Consumer Utility and Performance
15. Analysis Period
16. Social Cost of Carbon
17. Remote to Rack Equipment
18. Design Options Associated With Each
TSL
19. Standard Levels for Batch-Type Ice
Makers Over 2,500 lbs Ice/24 Hours
VIII. Approval of the Office of the Secretary
I. Summary of the Proposed Rule
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), established the
Energy Conservation Program for
Certain Industrial Equipment, a program
covering certain industrial equipment,2
which includes the focus of this
proposed rule: automatic commercial
ice makers.
Pursuant to EPCA, any new or
amended energy conservation standard
that DOE prescribes for the covered
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
(AEMTCA), Public Law 112–210 (Dec. 18, 2012).
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equipment, such as automatic
commercial ice makers, shall be
designed to achieve the maximum
improvement in energy efficiency that is
technologically feasible and
economically justified and would result
in significant conservation of energy.
(42 U.S.C. 6295(o)(2)(A) and (3)(B);
6313(d)(4))
In accordance with these and other
statutory criteria discussed in this
proposed rule, DOE proposes amended
conservation standards for automatic
commercial ice makers,3 and new
standards for covered equipment not yet
subject to energy conservation
standards. The proposed standards,
which consist of maximum allowable
energy usage values per 100 lb of ice
production, are shown in Table I.1 and
Table I.2. Standards shown on Table I.1
for batch type ice makers represent an
amendment to existing standards set for
cube type ice makers by EPCA in 42
U.S.C. 6313(d)(1). Table I.1 also shows
new standards for cube type ice makers
with expanded harvest capacities up to
4,000 pounds of ice per 24 hour period
(lb ice/24 hours) and an explicit
coverage of other types of batch
machines, such as tube type ice makers.
Table I.2 provides proposed standards
for continuous type ice-making
machines, which are not covered by
DOE’s existing standards. The proposed
standards include, for applicable
equipment classes, maximum condenser
water usage values in gallons per 100 lb
of ice production. If adopted, the
proposed standards would apply to all
equipment manufactured in, or
imported into, the United States,
beginning 3 years after the publication
date of the final rule. (42 U.S.C.
6313(d)(2)(B)(i) and (3)(C)(i))
TABLE I.1—PROPOSED ENERGY CONSERVATION STANDARDS FOR BATCH TYPE AUTOMATIC COMMERCIAL ICE MAKERS
Equipment type
Type of
cooling
Ice-Making Head .......................................................
Water ................
Ice-Making Head .......................................................
Air .....................
Remote Condensing (but not remote compressor) ..
Self-Contained ..........................................................
Air .....................
Air .....................
Air .....................
Air .....................
Water ................
Self-Contained ..........................................................
Air .....................
Remote Condensing and Remote Compressor .......
Rated harvest rate
lb ice/24 hours
<500
≥500 and <1,436
≥1,436 and <2,500
≥2,500 and <4,000
<450
≥450 and <875
≥875 and <2,210
≥2,210 and <2,500
≥ 2,500 and <4,000
<1,000
≥1,000 and <4,000
<934
≥934 and <4,000
<200
≥200 and <2,500
≥2,500 and <4,000
<175
≥175 and <4,000
Maximum
energy use
kilowatt-hours
(kWh)/100 lb ice *
5.84–0.0041H
3.88–0.0002H
3.6
3.6
7.70–0.0065H
5.17–0.0008H
4.5
6.89–0.0011H
4.1
7.52–0.0032H
4.3
7.52–0.0032H
4.5
8.55–0.0143H
5.7
5.7
12.6–0.0328H
6.9
Maximum
condenser
water use
gal/100 lb ice **
200–0.022H
200–0.022H
200–0.022H
145
NA
NA
NA
NA
NA
NA
NA
191–0.0315H
191–0.0315H
112
NA
NA
* H = rated harvest rate in pounds per 24 hours, indicating the water or energy use for a given rated harvest rate. Source: 42 U.S.C. 6313(d).
** Water use is for the condenser only and does not include potable water used to make ice.
TABLE I.2—PROPOSED ENERGY CONSERVATION STANDARDS FOR CONTINUOUS TYPE AUTOMATIC COMMERCIAL ICE
MAKERS
Type of
cooling
Ice-Making Head .......................................................
Water ................
Ice-Making Head .......................................................
Air .....................
Remote Condensing (but not remote compressor) ..
Air .....................
Remote Condensing and Remote Compressor .......
Air .....................
Self-Contained ..........................................................
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Equipment type
Water ................
Self-Contained ..........................................................
Air .....................
3 EPCA as amended by the Energy Policy Act of
2005 (EPACT 2005) established maximum energy
use and maximum condenser water use standards
for cube type automatic commercial ice makers
with harvest capacities between 50 and 2,500 lb/24
hours. In this rulemaking, DOE proposes amending
the legislated energy use standards for these
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Rated harvest rate
lb ice/24 hours
<900
≥900 and <2,500
≥2,500 and <4,000
<700
≥700 and <4,000
<850
≥850 and <4,000
<850
≥850 and <4,000
<900
≥900 and <2,500
≥2,500 and <4,000
<700
automatic commercial ice maker types. DOE did
not, however, consider amendment to the existing
condenser water use standards for equipment with
existing condenser water standards. In the
preliminary TSD, DOE indicated that the ice maker
standards primarily focus on energy use, and that
DOE is not bound by EPCA to evaluate reductions
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Maximum
energy use
kWh/100 lb ice *
6.08–0.0025H
3.8
3.8
9.24–0.0061H
5.0
7.5–0.0034H
4.6
7.65–0.0034H
4.8
7.28–0.0027H
4.9
4.9
9.2–0.0050H
Maximum
condenser
water use
gal/100 lb ice **
160–0.0176H
160–0.0176H
116
NA
NA
NA
NA
NA
NA
153–0.0252H
153–0.0252H
90
NA
in the condenser water use in automatic
commercial ice makers, and may in fact consider
increases in condenser water use, if this is a costeffective way to improve energy efficiency. Section
0 of today’s NOPR contains more information on
DOE’s analysis of condenser water use.
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TABLE I.2—PROPOSED ENERGY CONSERVATION STANDARDS FOR CONTINUOUS TYPE AUTOMATIC COMMERCIAL ICE
MAKERS—Continued
Type of
cooling
Equipment type
≥700 and <4,000
Maximum
condenser
water use
gal/100 lb ice **
Maximum
energy use
kWh/100 lb ice *
Rated harvest rate
lb ice/24 hours
5.7
NA
* H = rated harvest rate in pounds per 24 hours, indicating the water or energy use for a given rated harvest rate. Source: 42 U.S.C. 6313(d).
** Water use is for the condenser only and does not include potable water used to make ice.
A. Benefits and Costs to Customers
Table I.3 presents DOE’s evaluation of
the economic impacts of the proposed
standards on customers of automatic
commercial ice makers, as measured by
the average life-cycle cost (LCC)
savings 4 and the median payback
period (PBP).5 The average LCC savings
are positive for all equipment classes
under the standards proposed by DOE.
TABLE I.3—IMPACTS OF PROPOSED STANDARDS ON CUSTOMERS OF AUTOMATIC COMMERCIAL ICE MAKERS
Average LCC
savings
2012$
Equipment class *
IMH–W–Small–B ..............................................................................................................................................
IMH–W–Med–B ................................................................................................................................................
IMH–W–Large–B ** ..........................................................................................................................................
IMH–W–Large–B–1 .........................................................................................................................................
IMH–W–Large–B–2 .........................................................................................................................................
IMH–A–Small–B ...............................................................................................................................................
IMH–A–Large–B ** ...........................................................................................................................................
IMH–A–Large–B–1 ..........................................................................................................................................
IMH–A–Large–B–2 ..........................................................................................................................................
RCU–Large–B ** ..............................................................................................................................................
RCU–Large–B–1 ..............................................................................................................................................
RCU–Large–B–2 ..............................................................................................................................................
SCU–W–Large–B ............................................................................................................................................
SCU–A–Small–B ..............................................................................................................................................
SCU–A–Large–B .............................................................................................................................................
IMH–A–Small–C ..............................................................................................................................................
IMH–A–Large–C ..............................................................................................................................................
SCU–A–Small–C .............................................................................................................................................
328
587
833
701
1,260
396
1,127
1,168
908
983
963
1,277
694
396
502
391
1,026
146
Median PBP
years
2.27
0.85
0.69
0.72
0.58
1.42
0.84
0.82
0.94
0.65
0.62
1.00
1.00
1.56
1.49
0.97
0.69
1.85
* Abbreviations are: IMH is ice-making head; RCU is remote condensing unit; SCU is self-contained unit; W is water-cooled; A is air-cooled;
Small refers to the lowest harvest category; Med refers to the Medium category (water-cooled IMH only); RCU with and without remote compressor were modeled as one group. For three large batch categories, a machine at the low end of the harvest range (B–1) and a machine at
the higher end (B–2) were modeled. Values are shown only for equipment classes that have significant volume of shipments and, therefore, were
directly analyzed. See chapter 5 of the NOPR technical support document, ‘‘Engineering Analysis,’’ for a detailed discussion of equipment classes analyzed.
** LCC savings and PBP results for these classes are weighted averages of the typical units modeled for the large classes, using weights provided in TSD chapter 7.
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B. Impact on Manufacturers
The industry net present value (INPV)
is the sum of the discounted cash flows
to the industry from the present year
(2013) through the end of the analysis
period (2047). Using a real discount rate
of 9.2 percent, DOE estimates that the
INPV for manufacturers of automatic
commercial ice makers is $101.8 million
in 2012$. Under the proposed
standards, DOE expects that
manufacturers may lose up to 23.5
4 Life-cycle cost of automatic commercial ice
makers is the cost to customers of owning and
operating the equipment over the entire life of the
equipment. Life-cycle cost savings are the
reductions in the life-cycle costs due to the
amended energy conservation standards when
compared to the life-cycle costs of the equipment
in the absence of the amended energy conservation
standards.
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DOE’s analyses indicate that the
proposed standards for automatic
commercial ice makers would save a
significant amount of energy. The
lifetime savings for equipment
purchased in the 30-year period that
begins in the year of compliance with
amended and new standards (2018–
2047) 6 amount to 0.286 quadrillion
British thermal units (quads) of
cumulative energy.
The cumulative national net present
value (NPV) of total customer savings of
the proposed standards for automatic
commercial ice makers in 2012$ ranges
from $0.791 billion (at a 7-percent
5 Payback period refers to the amount of time (in
years) it takes customers to recover the increased
installed cost of equipment associated with new or
amended standards through savings in operating
costs.
6 The standards analysis period for national
benefits covers the 30-year period, plus the life of
equipment purchased during the period. In the past
DOE presented energy savings results for only the
30-year period that begins in the year of
compliance. In the calculation of economic impacts,
however, DOE considered operating cost savings
measured over the entire lifetime of products
purchased in the 30-year period. DOE has chosen
to modify its presentation of national energy
savings to be consistent with the approach used for
its national economic analysis.
percent of their INPV, or approximately
$23.9 million. Based on DOE’s
interviews with the manufacturers of
automatic commercial ice makers, DOE
does not expect any plant closings or
significant loss of employment.
C. National Benefits
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discount rate) to $1.751 billion (at a 3percent discount rate 7). This NPV
expresses the estimated total value of
future operating cost savings minus the
estimated increased installed costs for
equipment purchased in the period from
2018–2047, discounted to 2013.
In addition, the proposed standards
are expected to have significant
environmental benefits. The energy
savings would result in cumulative
emission reductions of 14.6 million
metric tons (MMt) 8 of carbon dioxide
(CO2), 8.7 thousand tons of nitrogen
oxides (NOX), 0.3 thousand tons of
nitrous oxide (N2O), 75.8 thousand tons
of methane (CH4) and 0.02 tons of
mercury (Hg),9 and 21 thousand tons of
sulfur dioxide (SO2) based on energy
savings from equipment purchased over
the period from 2018–2047.10
The value of the CO2 reductions is
calculated using a range of values per
metric ton of CO2 (otherwise known as
the Social Cost of Carbon, or SCC)
developed and recently updated by an
interagency process.11 The derivation of
the SCC value is discussed in section
IV.L. DOE estimates the net present
monetary value of the CO2 emissions
reduction is between $0.102 and $1.426
billion, expressed in 2012$ and
discounted to 2013. DOE also estimates
the net present monetary value of the
NOX emissions reduction, expressed in
2012$ and discounted to 2013, is
between $0.54 and $5.53 million at a 7percent discount rate, and between
$1.71 and $17.56 million at a 3-percent
discount rate.12
Table I.4 summarizes the national
economic costs and benefits expected to
result from today’s proposed standards
for automatic commercial ice makers.
TABLE I.4—SUMMARY OF NATIONAL ECONOMIC BENEFITS AND COSTS OF PROPOSED AUTOMATIC COMMERCIAL ICE
MAKER CONSERVATION STANDARDS
Present value
million 2012$
Category
Discount rate
(percent)
Benefits
Operating Cost Savings ...................................................................................................................................
982
2,114
102
463
733
1,426
3
10
1,448
2,587
191
364
Total Benefits †, †† .............................................................................................................................................
7
3
1,257
2,223
CO2 Reduction Monetized Value ($11.8/t case) * ...........................................................................................
CO2 Reduction Monetized Value ($39.7/t case) * ...........................................................................................
CO2 Reduction Monetized Value ($61.2/t case) * ...........................................................................................
CO2 Reduction Monetized Value ($117/t case) * ............................................................................................
NOX Reduction Monetized Value ($2,639/t case) ** .......................................................................................
7
3
5
3
2.5
3
7
3
7
3
7
3
Costs
Incremental Installed Costs .............................................................................................................................
Net Benefits
Including CO2 and NOX Reduction Monetized Value .....................................................................................
* The CO2 values represent global monetized values of the SCC, in 2012$, in year 2015 under several scenarios of the updated SCC values.
The values of $11.8, $39.7, and $61.2 per metric ton (t) are the averages of SCC distributions calculated using 5-percent, 3-percent, and 2.5percent discount rates, respectively. The value of $117.0/t represents the 95th percentile of the SCC distribution calculated using a 3-percent discount rate. The SCC time series used by DOE incorporate an escalation factor.
** The value represents the average of the low and high NOX values used in DOE’s analysis.
† Total Benefits for both the 3-percent and the 7-percent cases are derived using the series corresponding to SCC value of $39.7/t.
†† DOE estimates reductions in sulfur dioxide, mercury, methane and nitrous oxide emissions, but is not currently monetizing these reductions.
Thus, these impacts are excluded from the total benefits.
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The benefits and costs of today’s
proposed standards, for automatic
commercial ice makers sold in 2018–
2047, can also be expressed in terms of
annualized values. The annualized
monetary values are the sum of (1) the
annualized national economic value of
the benefits from the operation of
equipment that meets the proposed
standards (consisting primarily of
operating cost savings from using less
energy and water, minus increases in
equipment installed cost, which is
another way of representing customer
NPV); and (2) the annualized monetary
value of the benefits of emission
reductions, including CO2 emission
reductions.13
7 These discount rates are used in accordance
with the Office of Management and Budget (OMB)
guidance to Federal agencies on the development of
regulatory analysis (OMB Circular A–4, September
17, 2003), and section E, ‘‘Identifying and
Measuring Benefits and Costs,’’ therein. Further
details are provided in section 0.
8 A metric ton is equivalent to 1.1 U.S. short tons.
Results for NOX, Hg, and SO2 are presented in short
tons.
9 DOE calculates emissions reductions relative to
the Annual Energy Outlook 2013 (AEO2013)
Reference Case, which generally represents current
legislation and environmental regulations for which
implementing regulations were available as of
December 31, 2012.
10 DOE also estimated CO and CO equivalent
2
2
(CO2eq) emissions that occur through 2030 (CO2eq
includes greenhouse gases such as CH4 and N2O).
The estimated emissions reductions through 2030
are 5.8 million metric tons CO2, 576 thousand tons
CO2eq for CH4, and 25 thousand tons CO2eq for
N2O.
11 https://www.whitehouse.gov/sites/default/files/
omb/assets/inforeg/technical-update-social-cost-ofcarbon-for-regulator-impact-analysis.pdf.
12 DOE is currently investigating valuation of
avoided Hg and SO2 emissions.
13 DOE used a two-step calculation process to
convert the time-series of costs and benefits into
annualized values. First, DOE calculated a present
value in 2013, the year used for discounting the
NPV of total consumer costs and savings, for the
time-series of costs and benefits using discount
rates of 3 and 7 percent for all costs and benefits
except for the value of CO2 reductions. For the
latter, DOE used a range of discount rates, as shown
in Table I.5. From the present value, DOE then
calculated the fixed annual payment over a 30-year
period (2018 through 2047) that yields the same
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Although combining the values of
operating savings and CO2 emission
reductions provides a useful
perspective, two issues should be
considered. First, the national operating
savings are domestic U.S. customer
monetary savings that occur as a result
of market transactions, while the value
of CO2 reductions is based on a global
value. Second, the assessments of
operating cost savings and CO2 savings
are performed with different methods
that use different time frames for
analysis. The national operating cost
savings is measured over the lifetimes of
automatic commercial ice makers
shipped from 2018 to 2047. The SCC
values, on the other hand, reflect the
present value of some future climaterelated impacts resulting from the
emission of 1 ton of CO2 in each year.
These impacts continue well beyond
2100.
Estimates of annualized benefits and
costs of the proposed standards are
shown in Table I.5. (All monetary
values below are expressed in 2012$.)
Table I.5 shows the primary, low net
benefits, and high net benefits scenarios.
The primary estimate is the estimate in
which the operating cost savings were
calculated using the Annual Energy
Outlook 2013 (AEO2013) Reference Case
forecast of future electricity prices. The
low net benefits estimate and the high
net benefits estimate are based on the
low and high electricity price scenarios
from the AEO2013 forecast,
respectively.14 Using a 7-percent
discount rate for benefits and costs, the
cost in the primary estimate of the
standards proposed in this rule is $20
million per year in increased equipment
costs. (Note that DOE used a 3-percent
discount rate along with the
corresponding SCC series value of
$39.7/ton in 2012$ to calculate the
monetized value of CO2 emissions
reductions.) The annualized benefits are
$104 million per year in reduced
equipment operating costs, $27 million
in CO2 reductions, and $0.32 million in
reduced NOX emissions. In this case, the
annualized net benefit amounts to $110
14851
million. At a 3-percent discount rate for
all benefits and costs, the cost in the
primary estimate of the amended
standards proposed in this notice is $21
million per year in increased equipment
costs. The benefits are $121 million per
year in reduced operating costs, $27
million in CO2 reductions, and $0.55
million in reduced NOX emissions. In
this case, the net benefit amounts to
$128 million per year.
DOE also calculated the low net
benefits and high net benefits estimates
by calculating the operating cost savings
and shipments at the AEO2013 low
economic growth case and high
economic growth case scenarios,
respectively. The low and high benefits
for incremental installed costs were
derived using the low and high price
learning scenarios. The net benefits and
costs for low and high net benefits
estimates were calculated in the same
manner as the primary estimate by using
the corresponding values of operating
cost savings and incremental installed
costs.
TABLE I.5—ANNUALIZED BENEFITS AND COSTS OF PROPOSED STANDARDS FOR AUTOMATIC COMMERCIAL ICE MAKERS
Discount
rate
(percent)
Primary
estimate *
million 2012$
Low net
benefits
estimate *
million 2012$
High net
benefits
estimate *
million 2012$
Benefits
Operating Cost Savings ...................................................................
7
3
5
3
2.5
3
7
3
112
132
8
27
40
84
0.33
0.58
131
149
124
139
139
160
7
3
Total Benefits (Operating Cost Savings, CO2 Reduction and NOX
Reduction) † ..................................................................................
98
113
8
26
38
80
0.31
0.53
7
3
CO2 Reduction Monetized Value ($11.8/t case) ** ..........................
CO2 Reduction Monetized Value ($39.7/t case) ** ..........................
CO2 Reduction Monetized Value ($61.2/t case) ** ..........................
CO2 Reduction Monetized Value ($117/t case) ** ...........................
NOX Reduction Monetized Value (at $2,639/t case) ** ...................
104
121
8
27
39
82
0.32
0.55
20
21
21
22
20
20
110
128
103
118
120
140
Costs
Total Incremental Installed Costs ....................................................
Net Benefits Less Costs
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Total Benefits Less Incremental Costs ............................................
7
3
* The primary, low, and high estimates utilize forecasts of energy prices from the AEO2013 Reference Case, Low Economic Growth Case, and
High Economic Growth Case, respectively.
** The CO2 values represent global monetized values of the SCC, in 2012$, in 2015 under several scenarios of the updated SCC values. The
values of $11.8, $39.7, and $61.2 per ton are the averages of SCC distributions calculated using 5-percent, 3-percent, and 2.5-percent discount
rates, respectively. The value of $117.0 per ton represents the 95th percentile of the SCC distribution calculated using a 3-percent discount rate.
See section IV.L for details. For NOX, an average value ($2,639) of the low ($468) and high ($4,809) values was used.
† Total monetary benefits for both the 3-percent and 7-percent cases utilize the central estimate of social cost of NO and CO emissions calX
2
culated at a 3-percent discount rate (averaged across three integrated assessment models) , which is equal to $39.7/ton (in 2012$).
present value. The fixed annual payment is the
annualized value. Although DOE calculated
annualized values, this does not imply that the
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time-series of cost and benefits from which the
annualized values were determined is a steady
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14 The AEO2013 scenarios used are the ‘‘High
Economics’’ and ‘‘Low Economics’’ scenarios.
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DOE has tentatively concluded that
the proposed standards represent the
maximum improvement in energy
efficiency that is technologically
feasible and economically justified, and
would result in significant conservation
of energy (42 U.S.C. 6295(o)(2)(B) and
6313(d)(4)) DOE further notes that
technologies used to achieve these
standard levels are already
commercially available for the
equipment classes covered by this
notice. Based on the analyses described
above, DOE has tentatively concluded
that the benefits of the proposed
standards to the Nation (energy savings,
positive NPV of customer benefits,
customer LCC savings, and emission
reductions) would outweigh the
burdens (loss of INPV for manufacturers
and LCC increases for some customers).
DOE also considered more-stringent
energy use levels as trial standard levels
(TSLs), and is still considering them in
this rulemaking. However, DOE has
tentatively concluded that the potential
burdens of the more-stringent energy
use levels would outweigh the projected
benefits. Based on consideration of the
public comments DOE receives in
response to this proposed rule and
related information collected and
analyzed during the course of this
rulemaking effort, DOE may adopt
energy use levels presented in this
notice that are either higher or lower
than the proposed standards, or some
combination of level(s) that incorporate
the proposed standards in part.
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II. Introduction
The following section briefly
discusses the statutory authority
underlying this proposal, as well as
some of the relevant historical
background related to the establishment
of standards for automatic commercial
ice makers.
A. Authority
Title III, Part C of EPCA,15 Public Law
94–163 (42 U.S.C. 6311–6317, as
codified), established the Energy
Conservation Program for Certain
Industrial Equipment, a program
covering certain industrial equipment,
which includes the subject of this
rulemaking: Automatic commercial ice
makers.16
EPCA prescribed energy conservation
standards for automatic commercial ice
makers that produce cube type ice with
capacities between 50 and 2,500 lb ice/
15 For editorial reasons, upon codification in the
U.S. Code, Part C was re-designated Part A–1.
16 All references to EPCA in this document refer
to the statute as amended through the American
Energy Manufacturing Technical Corrections Act
(AEMTCA), Public Law 112–210 (Dec. 18, 2012).
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24 hours. (42 U.S.C. 6313(d)(1)) EPCA
requires DOE to review these standards
and determine, by January 1, 2015,
whether amending the applicable
standards is technically feasible and
economically justified. (42 U.S.C.
6313(d)(3)(A)) If amended standards are
technically feasible and economically
justified, DOE must issue a final rule by
the same date. (42 U.S.C. 6313(d)(3)(B))
Additionally, EPCA granted DOE the
authority to conduct rulemakings to
establish new standards for automatic
commercial ice makers not covered by
42 U.S.C. 6313(d)(1)), and DOE is using
that authority in this rulemaking. (42
U.S.C. 6313(d)(2)(A))
Pursuant to EPCA, DOE’s energy
conservation program for covered
equipment generally consists of four
parts: (1) Testing; (2) labeling; (3) the
establishment of Federal energy
conservation standards; and (4)
certification and enforcement
procedures. Subject to certain criteria
and conditions, DOE is required to
develop test procedures to measure the
energy efficiency, energy use, or
estimated annual operating cost of each
type or class of covered equipment. (42
U.S.C. 6314) Manufacturers of covered
equipment must use the prescribed DOE
test procedure as the basis for certifying
to DOE that their equipment complies
with the applicable energy conservation
standards adopted under EPCA.
Similarly, DOE must use these test
procedures to determine whether that
equipment complies with standards
adopted pursuant to EPCA. (42 U.S.C.
6295(s)) Manufacturers, when making
representations to the public regarding
the energy use or efficiency of that
equipment, must use the prescribed
DOE test procedure as the basis for such
representations. (42 U.S.C. 6314(d)) The
DOE test procedures for automatic
commercial ice makers currently appear
at title 10 of the Code of Federal
Regulations (CFR) part 431, subpart H.
DOE must follow specific statutory
criteria for prescribing amended
standards for covered equipment. As
indicated above, any amended standard
for covered equipment must be designed
to achieve the maximum improvement
in energy efficiency that is
technologically feasible and
economically justified. (42 U.S.C.
6295(o)(2)(A) and 6313(d)(4))
Furthermore, DOE may not adopt any
standard that would not result in the
significant conservation of energy. (42
U.S.C. 6295(o)(3) and 6313(d)(4)) DOE
also may not prescribe a standard: (1)
For certain industrial equipment,
including automatic commercial ice
makers, if no test procedure has been
established for the product; or (2) if DOE
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determines by rule that the proposed
standard is not technologically feasible
or economically justified. (42 U.S.C.
6295(o)(3)(A)–(B) and 6313(d)(4)) In
deciding whether a proposed standard
is economically justified, DOE must
determine whether the benefits of the
standard exceed its burdens. (42 U.S.C.
6295(o)(2)(B)(i) and 6313(d)(4)) DOE
must make this determination after
receiving comments on the proposed
standard, and by considering, to the
greatest extent practicable, the following
seven factors:
1. The economic impact of the
standard on manufacturers and
consumers of the equipment subject to
the standard;
2. The savings in operating costs
throughout the estimated average life of
the covered equipment in the type (or
class) compared to any increase in the
price, initial charges, or maintenance
expenses for the covered equipment that
are likely to result from the imposition
of the standard;
3. The total projected amount of
energy, or as applicable, water, savings
likely to result directly from the
imposition of the standard;
4. Any lessening of the utility or the
performance of the covered equipment
likely to result from the imposition of
the standard;
5. The impact of any lessening of
competition, as determined in writing
by the U.S. Attorney General (Attorney
General), that is likely to result from the
imposition of the standard;
6. The need for national energy and
water conservation; and
7. Other factors the Secretary of
Energy (Secretary) considers relevant.
(42 U.S.C. 6295(o)(2)(B)(i)(I)–(VII) and
6313(d)(4))
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
covered equipment. (42 U.S.C.
6295(o)(1) and 6313(d)(4)) 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) and 6313(d)(4))
Further, EPCA, as codified,
establishes a rebuttable presumption
that a standard is economically justified
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if the Secretary finds that the additional
cost to the consumer of purchasing a
product complying with an energy
conservation standard level will be less
than three times the value of the energy
savings during the first year that the
consumer will receive as a result of the
standard, as calculated under the
applicable test procedure. (See 42 U.S.C.
6295(o)(2)(B)(iii) and 6313(d)(4))
Section III.E.2 presents additional
discussion about rebuttable
presumption payback period (RPBP).
Additionally, 42 U.S.C. 6295(q)(1)
specifies requirements when
promulgating a standard for a type or
class of covered equipment. DOE must
specify a different standard level than
that which applies generally to such
type or class of equipment for any group
of covered products that has 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 equipment within such type (or
class); or (B) have a capacity or other
performance-related feature that other
equipment within such type (or class)
do not have and such feature 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
equipment, DOE must consider such
factors as the utility to the consumer of
the feature and other factors DOE deems
appropriate. Id. Any rule prescribing
such a standard must include an
explanation of the basis on which such
higher or lower level was established.
(42 U.S.C. 6295(q)(2))
Federal energy conservation
requirements generally supersede State
laws or regulations concerning energy
conservation testing, labeling, and
standards. (42 U.S.C. 6297(a)–(c) and
6316(f)) DOE may, however, grant
waivers of Federal preemption for
particular State laws or regulations, in
accordance with the procedures and
other provisions set forth under 42
U.S.C. 6297(d) and 6316(f).
DOE has also reviewed this regulation
pursuant to Executive Order 13563,
issued on January 18, 2011. 76 FR 3821
(Jan. 21, 2011). Executive Order 13563
is supplemental to and explicitly
reaffirms the principles, structures, and
definitions governing regulatory review
established in Executive Order 12866.
58 FR 51735 (Oct. 4, 1993). To the
extent permitted by law, agencies are
required by Executive Order 13563 to:
(1) Propose or adopt a regulation only
upon a reasoned determination that its
benefits justify its costs (recognizing
that some benefits and costs are difficult
to quantify); (2) tailor regulations to
impose the least burden on society,
consistent with obtaining regulatory
objectives, taking into account, among
other things, and to the extent
practicable, the costs of cumulative
regulations; (3) select, in choosing
among alternative regulatory
approaches, those approaches that
maximize net benefits (including
potential economic, environmental,
public health and safety, and other
advantages; distributive impacts; and
equity); (4) to the extent feasible, specify
performance objectives, rather than
specifying the behavior or manner of
compliance that regulated entities must
adopt; and (5) identify and assess
available alternatives to direct
regulation, including providing
economic incentives to encourage the
desired behavior, such as user fees or
marketable permits, or providing
information upon which choices can be
made by the public. 76 FR 3821 (Jan. 21,
2011).
14853
DOE emphasizes as well that
Executive Order 13563 requires agencies
to use the best available techniques to
quantify anticipated present and future
benefits and costs as accurately as
possible. In its guidance, the Office of
Information and Regulatory Affairs
(OIRA) has emphasized that such
techniques may include identifying
changing future compliance costs that
might result from technological
innovation or anticipated behavioral
changes. 76 FR 3821 (Jan. 21, 2011). For
the reasons stated in the preamble, DOE
believes that this NOPR is consistent
with these principles, including the
requirement that, to the extent
permitted by law, benefits justify costs
and that net benefits are maximized.
Consistent with Executive Order
13563, and the range of impacts
analyzed in this rulemaking, the
standards proposed herein by DOE
achieves maximum net benefits.
B. Background
1. Current Standards
In a final rule published on October
18, 2005, DOE adopted the energy
conservation standards and water
conservation standards prescribed by
EPCA in 42 U.S.C. 6313(d)(1) for certain
automatic commercial ice makers
manufactured on or after January 1,
2010. 70 FR at 60407, 60415–16. These
standards consist of maximum energy
use and maximum condenser water use
to produce 100 pounds of ice for
automatic commercial ice makers with
harvest rates between 50 and 2,500 lb
ice/24 hours. These standards appear at
10 CFR part 431, subpart H, Automatic
Commercial Ice Makers. Table II.1
presents DOE’s current energy
conservation standards for automatic
commercial ice makers.
TABLE II.1—AUTOMATIC COMMERCIAL ICE MAKERS STANDARDS PRESCRIBED BY EPCA—COMPLIANCE REQUIRED
BEGINNING ON JANUARY 1, 2010
Equipment type
Type of cooling
Ice-Making Head .......................................................
Water ................
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Air .....................
Remote Condensing (but not remote compressor) ..
Air .....................
Remote Condensing and Remote Compressor .......
Air .....................
Self-Contained ..........................................................
Water ................
Air .....................
Harvest rate
lb ice/24 hours
<500
≥500 and <1,436
≥1,436
<450
≥450
<1,000
≥1,000
<934
≥934
<200
≥200
<175
≥175
Maximum energy use
kWh/100 lb ice
Maximum condenser
water use *
gal/100 lb ice
7.8–0.0055H **
5.58–0.0011H
4.0
10.26–0.0086H
6.89–0.0011H
8.85–0.0038H
5.10
8.85–0.0038H
5.30
11.4–0.019H
7.60
18.0–0.0469H
9.80
200–0.022H.**
200–0.022H.
200–0.022H.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable.
191–0.0315H.
191–0.0315H.
Not Applicable.
Not Applicable.
Source: 42 U.S.C. 6313(d).
* Water use is for the condenser only and does not include potable water used to make ice.
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** H = harvest rate in pounds per 24 hours, indicating the water or energy use for a given harvest rate.
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2. History of Standards Rulemaking for
Automatic Commercial Ice Makers
As stated above, EPCA prescribes
energy conservation standards and
water conservation standards for certain
cube type automatic commercial ice
makers with harvest rates between 50
and 2,500 lb ice/24 hours: Selfcontained ice makers and ice-making
heads (IMHs) using air or water for
cooling and ice makers with remote
condensing with or without a remote
compressor. Compliance with these
standards was required as of January 1,
2010. (42 U.S.C. 6313(d)(1)) DOE
adopted these standards and placed
them under 10 CFR part 431, subpart H,
Automatic Commercial Ice Makers.
In addition, EPCA requires DOE to
conduct a rulemaking to determine
whether to amend the standards
established under 42 U.S.C. 6313(d)(1),
and if DOE determines that amendment
is warranted, DOE must also issue a
final rule establishing such amended
standards by January 1, 2015. (42 U.S.C.
6313(d)(3)(A))
Furthermore, EPCA granted DOE
authority to set standards for additional
types of automatic commercial ice
makers that are not covered in 42 U.S.C.
6313(d)(1). (42 U.S.C. 6313(d)(2)(A))
While not enumerated in EPCA,
additional types of automatic
commercial ice makers DOE identified
as candidates for standards to be
established in this rulemaking include
flake and nugget, as well as batch type
ice makers that are not included in the
EPCA definition of cube type ice
makers.
To satisfy its requirement to conduct
a rulemaking, DOE initiated the current
rulemaking on November 4, 2010 by
publishing on its Web site its
‘‘Rulemaking Framework for Automatic
Commercial Ice Makers.’’ (The
Framework document is available at:
www.regulations.gov/
#!documentDetail;D=EERE-2010-BTSTD-0037-0024.)
DOE also published a notice in the
Federal Register announcing the
availability of the Framework
document, as well as a public meeting
to discuss the document. The notice
also solicited comment on the matters
raised in the document. 75 FR 70852
(Nov. 19, 2010). The Framework
document described the procedural and
analytical approaches that DOE
anticipated using to evaluate amended
standards for automatic commercial ice
makers, and identified various issues to
be resolved in the rulemaking.
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DOE held the Framework public
meeting on December 16, 2010, at which
it: (1) Presented the contents of the
Framework document; (2) described the
analyses it planned to conduct during
the rulemaking; (3) sought comments
from interested parties on these
subjects; and (4) in general, sought to
inform interested parties about, and
facilitate their involvement in, the
rulemaking. Major issues discussed at
the public meeting included: (1) The
scope of coverage for the rulemaking; (2)
equipment classes; (3) analytical
approaches and methods used in the
rulemaking; (4) impacts of standards
and burden on manufacturers; (5)
technology options; (6) distribution
channels, shipments, and end users; (7)
impacts of outside regulations; and (8)
environmental issues. At the meeting
and during the comment period on the
Framework document, DOE received
many comments that helped it identify
and resolve issues pertaining to
automatic commercial ice makers
relevant to this rulemaking. These
comments are discussed in subsequent
sections of this notice.
DOE then gathered additional
information and performed preliminary
analyses to help review standards for
this equipment. This process
culminated in DOE publishing a notice
of another public meeting (the January
2012 notice) to discuss and receive
comments regarding the tools and
methods DOE used in performing its
preliminary analysis, as well as the
analyses results. 77 FR 3404 (Jan. 24,
2012). DOE also invited written
comments on these subjects and
announced the availability on its Web
site of a preliminary analysis technical
support document (preliminary analysis
TSD). Id. (The preliminary analysis TSD
is available at: www.regulations.gov/
#!documentDetail;D=EERE-2010-BTSTD-0037-0026.) Finally, DOE sought
comments concerning other relevant
issues that could affect amended
standards for automatic commercial ice
makers, or that DOE should address in
this NOPR. Id.
The preliminary analysis TSD
provided an overview of DOE’s review
of the standards for automatic
commercial ice makers, discussed the
comments DOE received in response to
the Framework document, and
addressed issues including the scope of
coverage of the rulemaking. The
document also described the analytical
framework that DOE used (and
continues to use) in considering
amended standards for automatic
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commercial ice makers, including a
description of the methodology, the
analytical tools, and the relationships
between the various analyses that are
part of this rulemaking. Additionally,
the preliminary analysis TSD presented
in detail each analysis that DOE had
performed for this equipment up to that
point, including descriptions of inputs,
sources, methodologies, and results.
These analyses were as follows:
• A market and technology
assessment addressed the scope of this
rulemaking, identified existing and
potential new equipment classes for
automatic commercial ice makers,
characterized the markets for this
equipment, and reviewed techniques
and approaches for improving its
efficiency;
• A screening analysis reviewed
technology options to improve the
efficiency of automatic commercial ice
makers, and weighed these options
against DOE’s four prescribed screening
criteria;
• An engineering analysis estimated
the manufacturer selling prices (MSPs)
associated with more energy-efficient
automatic commercial ice makers;
• An energy and water use analysis
developed the annual energy and water
usage values for economic analysis of
automatic commercial ice makers;
• A markups analysis converted
estimated MSPs derived from the
engineering analysis to customer
purchase prices;
• A life-cycle cost analysis calculated,
for individual customers, the
discounted savings in operating costs
throughout the estimated average life of
automatic commercial ice makers,
compared to any increase in installed
costs likely to result directly from the
imposition of a given standard;
• A payback period analysis
estimated the amount of time it would
take customers to recover the higher
purchase price of more energy-efficient
equipment through lower operating
costs;
• A shipments analysis estimated
shipments of automatic commercial ice
makers over the time period examined
in the analysis;
• A national impact analysis (NIA)
assessed the national energy savings
(NES), and the national NPV of total
customer costs and savings, expected to
result from specific, potential energy
conservation standards for automatic
commercial ice makers; and
• A preliminary manufacturer impact
analysis (MIA) took the initial steps in
evaluating the potential effects on
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manufacturers of amended efficiency
standards.
The public meeting announced in the
January 2012 notice took place on
February 16, 2012 (February 2012
preliminary analysis public meeting). At
the February 2012 preliminary analysis
public meeting, DOE presented the
methodologies and results of the
analyses set forth in the preliminary
analysis TSD. Interested parties
provided comments on the following
issues: (1) Equipment classes; (2)
technology options; (3) energy modeling
and validation of engineering models;
(4) cost modeling; (5) market
information, including distribution
channels and distribution markups; (6)
efficiency levels; (7) life-cycle costs to
customers, including installation, repair
and maintenance costs, and water and
wastewater prices; and (8) historical
shipments. The comments received
since publication of the January 2012
notice, including those received at the
February 2012 preliminary analysis
public meeting, have contributed to
DOE’s proposed resolution of the issues
14855
in this rulemaking as they pertain to
automatic commercial ice makers. This
NOPR responds to the issues raised by
the comments. (A parenthetical
reference at the end of a quotation or
paraphrase provides the location of the
item in the public record.)
III. General Discussion
A. List of Equipment Class
Abbreviations
In this notice, equipment class names
are frequently abbreviated. The
abbreviations are shown on Table III.1.
TABLE III.1—LIST OF EQUIPMENT CLASS ABBREVIATIONS
Abbreviation
Condenser
type
Equipment type
IMH–W–Small–B ..........................................
IMH–W–Med–B ............................................
IMH–W–Large–B * ........................................
IMH–A–Small–B ...........................................
IMH–A–Large–B* ** (also IMH–A–Large–B–
1).
IMH–A–Extended–B* **
(also
IMH–A–
Large–B–2).
RCU–NRC–Small–B .....................................
RCU–NRC–Large–B* ...................................
RCU–RC–Small–B .......................................
RCU–RC–Large–B .......................................
SCU–W–Small–B .........................................
SCU–W–Large–B .........................................
SCU–A–Small–B ..........................................
SCU–A–Large–B ..........................................
IMH–W–Small–C ..........................................
IMH–W–Large–C ..........................................
IMH–A–Small–C ...........................................
IMH–A–Large–C ...........................................
RCU–NRC–Small–C ....................................
RCU–NRC–Large–C ....................................
RCU–RC–Small–C .......................................
RCU–RC–Large–C .......................................
SCU–W–Small–C .........................................
SCU–W–Large–C .........................................
SCU–A-Small-C ............................................
SCU–A–Large–C ..........................................
Ice-Making
Ice-Making
Ice-Making
Ice-Making
Ice-Making
Head
Head
Head
Head
Head
Rated harvest rate
lb ice/24 hours
Ice type
..........................................
..........................................
..........................................
..........................................
..........................................
Water .........
Water .........
Water .........
Air ..............
Air ..............
<500
≥500 and <1,436
≥1,436 and <4,000
<450
≥450 and <875
Batch.
Batch.
Batch.
Batch.
Batch.
Ice-Making Head ..........................................
Air ..............
≥875 and <4,000
Batch.
Remote Condensing, not Remote Compressor.
Remote Condensing, not Remote Compressor.
Remote Condensing, and Remote Compressor.
Remote Condensing, and Remote Compressor.
Self-Contained Unit ......................................
Self-Contained Unit ......................................
Self-Contained Unit ......................................
Self-Contained Unit ......................................
Ice-Making Head ..........................................
Ice-Making Head ..........................................
Ice-Making Head ..........................................
Ice-Making Head ..........................................
Remote Condensing, not Remote Compressor.
Remote Condensing, not Remote Compressor.
Remote Condensing, and Remote Compressor.
Remote Condensing, and Remote Compressor.
Self-Contained Unit ......................................
Self-Contained Unit ......................................
Self-Contained Unit ......................................
Self-Contained Unit ......................................
Air ..............
<1,000
Batch.
Air ..............
≥1,000 and <4,000
Batch.
Air ..............
<934
Batch.
Air ..............
≥934 and <4,000
Batch.
Water .........
Water .........
Air ..............
Air ..............
Water .........
Water .........
Air ..............
Air ..............
Air ..............
<200
≥200 and
<175
≥175 and
<900
≥900 and
<700
≥700 and
<850
Batch.
Batch.
Batch.
Batch.
Continuous.
Continuous.
Continuous.
Continuous.
Continuous.
Air ..............
≥850 and <4,000
Continuous.
Air ..............
<850
Continuous.
Air ..............
≥850 and <4,000
Continuous.
Water .........
Water .........
Air ..............
Air ..............
<900
≥900 and <4,000
<700
≥700 and <4,000
Continuous.
Continuous.
Continuous.
Continuous.
<4,000
<4,000
<4,000
<4,000
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* IMH–W–Large–B, IMH–A–Large–B, and RCU–NRC–Large–B were modeled in some NOPR analyses as two different units, one at the lower
end of the rated harvest range and one near the high end of the rated harvest range in which a significant number of units are available. In the
LCC and NIA models, the low and high harvest rate models were denoted simply as B–1 and B–2. Where appropriate, the analyses add or perform weighted averages of the two typical sizes to present class level results.
** IMH–A–Large–B was established by EPACT–2005 as a class between 450 and 2,500 lb ice/24 hours. In this notice, DOE is proposing to divide this into two classes, which could either be considered ‘‘Large’’ and ‘‘Very Large’’ or ‘‘Medium’’ and ‘‘Large.’’ In the LCC and NIA modeling,
this was denoted as B–1 and B–2. The rated harvest rate break point shown above is based on TSL 3 results.
B. Test Procedures
On December 8, 2006, DOE published
a final rule in which it adopted AirConditioning and Refrigeration Institute
(ARI) Standard 810–2003, ‘‘Performance
Rating of Automatic Commercial Ice
Makers,’’ with a revised method for
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calculating energy use, as the DOE test
procedure for this equipment. The DOE
rule included a clarification to the
energy use rate equation to specify that
the energy use be calculated using the
entire mass of ice produced during the
testing period, normalized to 100 lb of
ice produced. 71 FR 71340, 71350 (Dec.
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8, 2006). ARI Standard 810–2003
requires performance tests to be
conducted according to the American
National Standards Institute (ANSI)/
American Society of Heating,
Refrigerating, and Air-Conditioning
Engineers (ASHRAE) Standard 29–1988
(reaffirmed 2005), ‘‘Method of Testing
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screening criteria: (1) Practicability to
manufacture, install, or service; (2)
adverse impacts on product utility or
availability; and (3) adverse impacts on
health or safety. 10 CFR part 430,
subpart C, appendix A, section
4(a)(4)(ii)–(iv) Chapter 4 of the NOPR
TSD discusses the results of the
screening analyses for automatic
commercial ice makers. Specifically, it
presents the designs DOE considered,
those it screened out, and those that are
the bases for the TSLs in this
rulemaking.
Automatic Ice Makers.’’ The DOE test
procedure incorporated by reference the
ANSI/ASHRAE Standard 29–1988
(Reaffirmed 2005) as the method of test.
On January 11, 2012, DOE published
a test procedure final rule (2012 test
procedure final rule) in which it
adopted several amendments to the DOE
test procedure. This included an
amendment to incorporate by reference
Air-Conditioning, Heating, and
Refrigeration Institute (AHRI) Standard
810–2007, which amends ARI Standard
810–2003 to expand the capacity range
of covered equipment, provide
definitions and specific test procedures
for batch and continuous type ice
makers, and provide a definition for ice
hardness factor, as the DOE test
procedure for this equipment. 77 FR
1591 (Jan. 11, 2012). In March 2011,
AHRI published Addendum 1 to
Standard 810–2007, which revised the
definition of ‘‘potable water use rate’’
and added new definitions for ‘‘purge or
dump water’’ and ‘‘harvest water.’’
DOE’s 2012 test procedure final rule
incorporated this addendum to the
AHRI Standard. The 2012 test procedure
final rule also included an amendment
to incorporate by reference the updated
ANSI/ASHRAE Standard 29–2009. Id.
In addition, the 2012 test procedure
final rule included several amendments
designed to address issues that were not
accounted for by the previous DOE test
procedure. 77 FR at 1593 (Jan. 11, 2012).
First, DOE expanded the scope of the
test procedure to include equipment
with capacities from 50 to 4,000 lb ice/
24 hours.17 DOE also adopted
amendments to provide test methods for
continuous type ice makers and to
standardize the measurement of energy
and water use for continuous type ice
makers with respect to ice hardness. In
the 2012 test procedure final rule, DOE
also clarified the test method and
reporting requirements for remote
condensing automatic commercial ice
makers designed for connection to
remote compressor racks. Finally, the
2012 test procedure final rule
discontinued the use of the clarified
energy use rate calculation and instead
required energy-use to be calculated per
100 lb of ice as specified in ANSI/
ASHRAE Standard 29–2009. The 2012
test procedure final rule became
effective on February 10, 2012, and the
changes set forth in the final rule
became mandatory for equipment
testing starting January 7, 2013. 77 FR
at 1593 (Jan. 11, 2012).
The test procedure amendments
established in the 2012 test procedure
final rule are required to be used in
conjunction with any new standards
promulgated as a result of this standards
rulemaking. Use of the amended test
procedure to demonstrate compliance
with DOE energy conservation
standards or for representations with
respect to energy consumption of
automatic commercial ice makers is
required on the compliance date of any
energy conservation standards
established as part of this rulemaking,
and on January 7, 2013 for the energy
conservation standards set in the Energy
Policy Act of 2005 (EPACT 2005). 77 FR
at 1593 (Jan. 11, 2012).
1. General
In each standards rulemaking, DOE
conducts a screening analysis, which it
bases on information that it has gathered
on all current technology options and
prototype designs that could improve
the efficiency of the products or
equipment that are the subject of the
rulemaking. As the first step in such
analysis, DOE develops a list of design
options for consideration, in
consultation with manufacturers, design
engineers, and other interested parties.
DOE then determines which of these
options for improving efficiency are
technologically feasible. DOE considers
a design option to be technologically
feasible if it is used by the relevant
industry or if a working prototype has
been developed. Technologies
incorporated in commercially available
equipment or in working prototypes
will be considered technologically
feasible. 10 CFR part 430, subpart C,
appendix A, section 4(a)(4)(i) Although
DOE considers technologies that are
proprietary, it will not consider
efficiency levels that can only be
reached through the use of proprietary
technologies (i.e., a unique pathway),
which could allow a single
manufacturer to monopolize or control
the market.
Once DOE has determined that
particular design options are
technologically feasible, it further
evaluates each of these design options
in light of the following additional
When DOE proposes to adopt (or not
adopt) an amended or new energy
conservation standard for a type or class
of covered equipment such as automatic
commercial ice makers, it determines
the maximum improvement in energy
efficiency that is technologically
feasible for such equipment. (See 42
U.S.C. 6295(p)(1) and 6313(d)(4))
Accordingly, in the preliminary
analysis, DOE determined the maximum
technologically feasible (‘‘max-tech’’)
improvements in energy efficiency for
automatic commercial ice makers in the
engineering analysis using the design
parameters that passed the screening
analysis. See chapter 5 of the NOPR
TSD for the results of the analyses, and
a list of technologies included in maxtech equipment.
As indicated previously, whether
efficiency levels exist or can be
achieved in commonly used equipment
is not relevant to whether they are maxtech levels. DOE considers technologies
to be technologically feasible if they are
incorporated in any currently available
equipment or working prototypes.
Hence, a max-tech level results from the
combination of design options predicted
to result in the highest efficiency level
possible for an equipment class, with
such design options consisting of
technologies already incorporated in
commercial equipment or working
prototypes. DOE notes that it
reevaluated the efficiency levels,
including the max-tech levels, when it
updated its results for this NOPR. Table
III.2 and Table III.3 show the max-tech
levels determined in the engineering
analysis for batch and continuous type
automatic commercial ice makers,
respectively.
17 EPCA defines automatic commercial ice maker
in 42 U.S.C. 6311(19) as ‘‘a factory-made assembly
(not necessarily shipped in 1 package) that—(1)
Consists of a condensing unit and ice-making
section operating as an integrated unit, with means
for making and harvesting ice; and (2) May include
means for storing ice, dispensing ice, or storing and
dispensing ice.’’ This definition includes
commercial ice-making equipment up to 4,000 lb
ice/24 hours, though DOE had not previously
established test procedures and standards for units
with the capacity between 2,500 and 4,000 lb ice/
24 hours. While 42 U.S.C. 6313(d)(1) explicitly sets
standards for cube type ice makers up to 2,500 lb
ice/24 hours, 6313(d)(2) provides authority to set
standards for other equipment types—all of which
are covered by the EPCA definition of an automatic
commercial ice maker.
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2. Maximum Technologically Feasible
Levels
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14857
TABLE III.2—MAX-TECH LEVELS FOR BATCH AUTOMATIC COMMERCIAL ICE MAKERS
Equipment type *
Energy use lower than baseline
IMH–W–Small–B .......................................
IMH–W–Med–B .........................................
IMH–W–Large–B .......................................
IMH–A–Small–B ........................................
IMH–A–Large–B ........................................
RCU–Small–B ...........................................
RCU–Large–B ...........................................
SCU–W–Small–B ......................................
SCU–W–Large–B ......................................
SCU–A–Small–B .......................................
SCU–A–Large–B .......................................
30%.
22%.
17% (at 1,500 lb ice/24 hours) 16% (at 2,600 lb ice/24 hours).
33%.
33% (at 800 lb ice/24 hours) 21% (at 1,500 lb ice/24 hours).
Not analyzed—similar to IMH–A.–Large–B (1500).
21% (at 1,500 lb ice/24 hours) 21% (at 2,400 lb ice/24 hours).
Not analyzed—similar to SCU–A–Large–B.
35%.
41%.
36%.
* IMH is ice-making head; RCU is remote condensing unit; SCU is self-contained unit; W is water-cooled; A is air-cooled; Small refers to the
lowest harvest category; Med refers to the Medium category (water-cooled IMH only); Large refers to the large size category; RCU units were
modeled as one with line losses used to distinguish standards.
** For equipment classes that were not analyzed, DOE did not develop specific cost-efficiency curves but attributed the curve (and maximum
technology point) from one of the analyzed equipment classes.
TABLE III.3—MAX-TECH LEVELS FOR CONTINUOUS AUTOMATIC COMMERCIAL ICE MAKERS
Equipment type
Energy use lower than baseline
IMH–W–Small–C .......................................
IMH–W–Large–C ......................................
Not analyzed—similar to IMH–A–Large–C (820).
Not analyzed at 1,000 lb/day—similar to IMH–A–Large–C (820) Not analyzed at 1,800 lb/day—similar to IMH–A–Large–C (820).
25.3%.
17% (at 820 lb ice/24 hours) Not analyzed at 1,800 lb/day—similar to IMH–A–Large–C (820).
Not analyzed—similar to IMH–A–Large–C (820).
Not analyzed—similar to IMH–A–Large–C (820).
Not analyzed—similar to SCU–A–Small–C.
No units available.
24%.
No units available.
IMH–A–Small–C ........................................
IMH–A–Large–C .......................................
RCU–Small–C ...........................................
RCU–Large–C ...........................................
SCU–W–Small–C ......................................
SCU–W–Large–C * ...................................
SCU–A–Small–C .......................................
SCU–A–Large–C * ....................................
* DOE’s investigation of equipment on the market revealed that there are no existing products in either of these two equipment classes (as defined in this NOPR).
** For equipment classes that were not analyzed, DOE did not develop specific cost-efficiency curves but attributed the curve (and maximum
technology point) from one of the analyzed equipment classes.
D. Energy and Water Savings
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1. Determination of Savings
For each TSL, DOE projected energy
savings from automatic commercial ice
makers purchased in the 30-year period
that begins in the year of compliance
with amended and new standards
(2018–2047). The savings are measured
over the entire lifetime of equipment
purchased in the 30-year period. DOE
quantified the energy savings
attributable to each TSL as the
difference in energy consumption
between each standards case and the
base case. The base case represents a
projection of energy consumption in the
absence of amended mandatory
efficiency standards, and considers
market forces and policies that affect
demand for more-efficient equipment.
DOE used its NIA spreadsheet model
to estimate energy savings from
amended standards for the equipment
that are the subject of this rulemaking.
The NIA spreadsheet model (described
in section IV.H of this notice) calculates
energy savings in site energy, which is
the energy directly consumed by
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equipment at the locations where they
are used.
Because automatic commercial ice
makers use water, water savings were
quantified in the same way as energy
savings.
For electricity, DOE reports national
energy savings in terms of the savings in
energy that is used to generate and
transmit the site electricity. To convert
this quantity, DOE derives annual
conversion factors from the model used
to prepare the Energy Information
Administration’s (EIA’s) Annual Energy
Outlook.
DOE has also begun to estimate fullfuel-cycle (FFC) energy savings. 76 FR
51282 (Aug. 18, 2011). The FFC metric
includes the energy consumed in
extracting, processing, and transporting
primary fuels, and thus presents a more
complete picture of the impacts of
efficiency standards. DOE’s approach is
based on calculation of an FFC
multiplier for each of the fuels used by
covered equipment.
2. Significance of Savings
As noted above, 42 U.S.C.
6295(o)(3)(B) prevents DOE from
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adopting a standard for a covered
product unless such standard would
result in ‘‘significant’’ energy savings.
Although the term ‘‘significant’’ is not
defined in the Act, the U.S. Court of
Appeals, in Natural Resources Defense
Council v. Herrington, 768 F.2d 1355,
1373 (D.C. Cir. 1985), indicated that
Congress intended ‘‘significant’’ energy
savings in this context to be savings that
were not ‘‘genuinely trivial.’’ The
estimated energy savings in the 30-year
analysis period for the TSLs (presented
in section V.A) are nontrivial, and,
therefore, DOE considers them
‘‘significant’’ within the meaning of
section 325 of EPCA.
E. Economic Justification
1. Specific Criteria
EPCA provides seven factors to be
evaluated in determining whether a
potential energy conservation standard
is economically justified. (42 U.S.C.
6295(o)(2)(B)(i) and 6313(d)(4)) The
following sections generally discuss
how DOE is addressing each of those
seven factors in this rulemaking. For
further details and the results of DOE’s
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analyses pertaining to economic
justification, see sections IV and V of
today’s rulemaking.
a. Economic Impact on Manufacturers
and Commercial Customers
In determining the impacts of an
amended standard on manufacturers,
DOE first uses an annual cash flow
approach to determine the quantitative
impacts. This step includes both a shortterm assessment—based on the cost and
capital requirements during the period
between when a regulation is issued and
when entities must comply with the
regulation—and a long-term assessment
over a 30-year period. The industrywide impacts analyzed include INPV,
which values the industry on the basis
of expected future cash flows; cash
flows by year; changes in revenue and
income; and other measures of impact,
as appropriate. Second, DOE analyzes
and reports the impacts on different
types of manufacturers, including
impacts on small manufacturers. Third,
DOE considers the impact of standards
on domestic manufacturer employment
and manufacturing capacity, as well as
the potential for standards to result in
plant closures and loss of capital
investment. Finally, DOE takes into
account cumulative impacts of various
DOE regulations and other regulatory
requirements on manufacturers.
For a detailed description of the
methodology used to assess the
economic impact on manufacturers, see
section IV.J of this rulemaking. For
results, see section V.B.2 of this
rulemaking. Additionally, chapter 12 of
the NOPR TSD contains a detailed
description of the methodology and
discussion of the results.
For individual customers,18 measures
of economic impact include the changes
in LCC and the PBP associated with new
or amended standards. The LCC, which
is specified separately in EPCA as one
of the seven factors to be considered in
determining the economic justification
for a new or amended standard, 42
U.S.C. 6295(o)(2)(B)(i)(II), is discussed
in the following section. For customers
in the aggregate, DOE also calculates the
national net present value of the
economic impacts applicable to a
particular rulemaking. For a description
of the methodology used for assessing
the economic impact on customers, see
sections IV.G and IV.H; for results, see
sections V.B.1 and V.B.2 of this
rulemaking. Additionally, chapters 8
and 10 and the associated appendices of
18 Customers, or consumers, in the case of
commercial and industrial equipment, are
considered to be the businesses that purchase or
lease the equipment or may be responsible for the
cost of operating the equipment.
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the NOPR TSD contain a detailed
description of the methodology and
discussion of the results. For a
description of the methodology used to
assess the economic impact on
manufacturers, see section IV.J; for
results, see section V.B.2 of this
rulemaking. Additionally, chapter 12 of
the NOPR TSD contains a detailed
description of the methodology and
discussion of the results.
b. Life-Cycle Costs
The LCC is the sum of the purchase
price of equipment (including its
installation) and the operating costs
(including energy, water, maintenance,
and repair expenditures) discounted
over the lifetime of the equipment. The
LCC savings for the considered
efficiency levels are calculated relative
to a base case that reflects projected
market trends in the absence of new or
amended standards. The LCC analysis
requires a variety of inputs, such as
product prices, product energy and
water consumption, energy and water
prices, maintenance and repair costs,
product lifetime, and consumer
discount rates. For its analysis, DOE
assumes that consumers will purchase
the considered equipment in the first
year of compliance with amended
standards.
To account for uncertainty and
variability in specific inputs, such as
equipment lifetime and discount rate,
DOE uses a distribution of values, with
probabilities attached to each value.
DOE identifies the percentage of
customers estimated to receive LCC
savings, or experience an LCC increase,
in addition to the average LCC savings
associated with a particular standard
level. DOE also evaluates the LCC
impacts of potential standards on
identifiable subgroups of customers that
may be affected disproportionately by a
national standard. For the results of
DOE’s analyses related to the LCC, see
section V.B.1 of this rulemaking and
chapter 8 of the NOPR TSD; for LCC
impacts on identifiable subgroups, see
section V.B.1 of this notice and chapter
11 of the NOPR TSD.
c. Energy Savings
Although significant conservation of
energy is a separate statutory
requirement for imposing an energy
conservation standard, EPCA requires
DOE, in determining the economic
justification of a standard, to consider
the total projected energy savings that
are expected to result directly from the
standard. (42 U.S.C. 6295(o)(2)(B)(i)(III)
and 6313(d)(4)) As discussed in section
VI.B.3, DOE uses the NIA spreadsheet to
project energy savings.
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d. Lessening of Utility or Performance of
Equipment
In establishing classes of equipment,
and in evaluating design options and
the impact of potential standard levels,
DOE evaluates standards that would not
lessen the utility or performance of the
equipment under consideration. (42
U.S.C. 6295(o)(2)(B)(i)(IV) and
6313(d)(4)) The standards proposed in
today’s rulemaking will not reduce the
utility or performance of the equipment
considered in the rulemaking. For
DOE’s analyses related to the potential
impact of amended standards on
equipment utility and performance, see
section V.B.4 of this rulemaking and
chapter 4 of the NOPR TSD.
e. Impact of Any Lessening of
Competition
EPCA directs DOE to consider the
impact of any lessening of competition,
as determined in writing by the
Attorney General, that is likely to result
from the imposition of a standard. (42
U.S.C. 6295(o)(2)(B)(i)(V)) It directs the
Attorney General to make such
determination, if any, of any lessening
of competition likely to result from a
proposed standard, and to transmit such
determination to the Secretary, within
60 days of the publication of a proposed
rule, together with an analysis of the
nature and extent of the impact. (42
U.S.C. 6295(o)(2)(B)(ii)) DOE will
transmit a copy of today’s proposed rule
to the Attorney General with a request
that the Department of Justice (DOJ)
provide its determination on this issue.
DOE will address the Attorney General’s
determination in the final rule.
f. Need of the Nation To Conserve
Energy
The energy savings from the proposed
standards are likely to provide
improvements to the security and
reliability of the nation’s energy system.
Reductions in the demand for electricity
also may result in reduced costs for
maintaining the reliability of the
nation’s electricity system. DOE
conducts a utility impact analysis to
estimate how standards may affect the
nation’s needed power generation
capacity. (42 U.S.C. 6295(o)(2)(B)(i)(VI)
and 6316(e)(1))
The proposed standards also are
likely to result in environmental
benefits in the form of reduced
emissions of air pollutants and
greenhouse gases (GHGs) associated
with energy production. DOE reports
the emissions impacts from today’s
standards, and from each TSL it
considered, in sections IV.K, IV.L and
V.B.6 of this rulemaking. DOE also
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reports estimates of the economic value
of emissions reductions resulting from
the considered TSLs.
g. Other Factors
EPCA allows the Secretary of Energy,
in determining whether a new or
amended standard is economically
justified, to consider any other factors
that the Secretary deems to be relevant.
(42 U.S.C. 6295(o)(2)(B)(i)(VII) and
6316(e)(1)) In developing this proposed
rule, DOE has also considered the
comments submitted by interested
parties. For the results of DOE’s
analyses related to other factors, see
section V.B.7 of this rulemaking.
2. Rebuttable Presumption
As set forth in 42 U.S.C.
6295(o)(2)(B)(iii) and 6313(d)(4), EPCA
provides for a rebuttable presumption
that an energy conservation standard is
economically justified if the additional
cost to the customer of equipment that
meets the new or amended standard
level is less than three times the value
of the first year’s energy savings
resulting from the standard, as
calculated under the applicable DOE
test procedure. DOE’s LCC and PBP
analysis generates values used to
calculate the effects that proposed
energy conservation standards would
have on the PBP for customers. These
analyses include, but are not limited to,
the 3-year PBP contemplated under the
rebuttable presumption test. In addition,
DOE routinely conducts an economic
analysis that considers the full range of
impacts to the customer, manufacturer,
the Nation, and environment, as
required under 42 U.S.C.
6295(o)(2)(B)(i) and 6313(d)(4). The
results of these analyses serve as the
basis for DOE’s evaluation of the
economic justification for a potential
standard level (thereby supporting or
rebutting the results of any preliminary
determination of economic
justification). The rebuttable
presumption payback calculation is
discussed in section IV.G.12 of this
rulemaking and chapter 8 of the NOPR
TSD.
IV. Methodology and Discussion of
Comments
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A. General Rulemaking Issues
During the February 2012 preliminary
analysis public meeting and in
subsequent written comments,
stakeholders provided input regarding
general issues pertinent to the
rulemaking, such as issues of scope of
coverage and DOE’s authority in setting
standards. These issues are discussed in
this section.
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1. Statutory Authority
In the preliminary analysis, DOE
stated its position that EPCA prevents
the setting of both energy performance
standards and prescriptive design
requirements (see chapter 2 of the
preliminary analysis TSD). DOE also
stated its intent to amend the energy
performance standards for automatic
commercial ice makers, and not to set
prescriptive design requirements at this
time (see chapter 2 of the preliminary
analysis TSD).
2. Test Procedures
As discussed in section III.A, DOE
published a test procedure final rule in
January 2012 (2012 test procedure final
rule). 77 FR 1591 (Jan. 11, 2012). All
automatic commercial ice makers
covered by DOE energy conservation
standards promulgated as a result of this
energy conservation standards
rulemaking will be required to use the
2012 test procedures to demonstrate
compliance beginning on the
compliance date set at the conclusion of
this rulemaking. 77 FR at 1593 (Jan. 11,
2012). The standards can be found at
title 10 CFR part 431, subpart H (or,
alternatively, 10 CFR 431.134).
Since the publication of the 2012 test
procedure final rule, DOE has received
several inquiries from interested parties
regarding proper conduct of the DOE
test procedure. Specifically, interested
parties inquired regarding the
appropriate use of baffles and automatic
purge water controls during the DOE
test procedure. On January 28, 2013,
DOE published draft guidance
documents to address the issues
regarding baffles 19 and automatic purge
water controls 20 and provided an
opportunity for interested parties to
comment on those interpretations of the
DOE test procedure for automatic
commercial ice makers. The comment
period for those guidance documents
extended until February 28, 2013. DOE
will publish a final guidance document
and responses to all comments received
on the DOE Appliance and Commercial
Equipment Standards Web site
(www1.eere.energy.gov/guidance/
default.aspx?pid=2&spid=1). However,
DOE notes that these guidance
documents serve only to clarify existing
test procedure requirements, as
established in the 2012 test procedure
19 https://www1.eere.energy.gov/buildings/
appliance_standards/pdfs/acim_baffles_faq_20139-24final.pdf.
20 https://www1.eere.energy.gov/buildings/
appliance_standards/pdfs/acim_purge_faq_2013-925final.pdf.
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final rule, and do not alter the DOE test
procedure.
DOE’s test procedures are set in
separate rulemaking processes.
However, as part of the automatic
commercial ice maker energy
conservation standards rulemaking,
DOE did receive two comments related
to the test procedures. Howe noted that
measuring potable water use is
important because de-scaling is crucial
for maintaining the efficiency and
utility of automatic commercial ice
makers. Howe also recommended that
DOE obtain information from additional
manufacturers on the relationship
between potable water use and
automatic commercial ice maker
performance. (Howe, No. 51 at p. 2) 21
The People’s Republic of China
(China) noted that there are differences
among test processes for refrigeration
products issued by different bodies in
the U.S. China stated that different test
procedures may lead to different results
for one product, and it will affect the
judgment of compliance. Therefore,
China suggested that the U.S.
government unify the test procedure.
(China, No. 55 at p. 3)
As noted earlier, the 2012 test
procedure final rule was published on
January 11, 2012, and the energy
conservation standards will be based on
this test procedure. 77 FR at 1593. With
regard to Howe’s comment, in the final
rule, DOE elected to not require
measurement of potable water. Since
DOE is not setting potable water limits
for automatic commercial ice makers,
requiring manufacturers to measure
potable water use would be an
unnecessary expense. With regard to
China’s comment, DOE has no authority
regarding adjustment of the test
procedures of other organizations. Also,
if there is any uncertainty regarding
how to conduct the test, manufacturers
and others may request clarification
from DOE. By updating the test
procedure to reflect current AHRI and
ANSI/ASHRAE standards, DOE expects
any differences of the type noted by
China will be minimized.
3. Need for and Scope of Rulemaking
At the February 2012 preliminary
analysis public meeting and in written
21 A notation in this form provides a reference for
information that is in the docket of DOE’s ‘‘Energy
Conservation Program for Certain Commercial and
Industrial Equipment: Energy Conservation
Standards for Automatic Commercial Ice Makers’’
(Docket No. EERE–2010–BT–STD–0037), which is
maintained at www.regulations.gov. This notation
indicates that the statement preceding the reference
is document number 51 in the docket for the
automatic commercial ice makers energy
conservation standards rulemaking, and appears at
page 2 of that document.
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comments, DOE received comments
about the need for the rulemaking.
Hoshizaki suggested DOE not adjust the
energy standards for automatic
commercial ice makers regulated under
EPACT 2005, arguing that tightening the
regulations that were just released 2
years ago would negatively impact both
manufacturers and end users.
(Hoshizaki, No. 53 at p. 3) AHRI opined
that, because the full effects of the
EPACT 2005 standards will not be
known until at least 2013, DOE should
only consider the previously uncovered
continuous and high-capacity batch
type ice makers in this rulemaking.
(AHRI, No. 49 at p. 3)
Scotsman asked whether the
upcoming rulemaking would cover
products that both make and dispense
ice. (Scotsman, Public Meeting
Transcript, No. 42 at p. 26) 22
In response to the comments about
the need for starting this rulemaking,
DOE notes that under EPACT 2005, DOE
must review the existing standards and,
if justified, develop amended standards
by January 1, 2015. Thus, DOE
commenced the rulemaking to ensure
compliance with the statutory deadline.
During the rulemaking, DOE considered
alternatives to this rulemaking in the
regulatory impact analysis; this analysis
is described in Section IV.O of today’s
NOPR. As for covering products that
make and dispense ice, the scope of the
rulemaking is ice-making products.
While the 42 U.S.C. 6311(19) definition
of automatic commercial ice maker
stated an ice maker may or may not
include a means for dispensing or
storing ice, not all ice makers do include
such ancillary equipment. As discussed
in the preliminary analysis TSD, section
2.2.4.2, DOE determined that
promulgating standards to regulate the
energy usage of dispensers and storage
bins may have an unintended impact on
customer choices when choosing
between models that include or do not
include such ancillary equipment. By
regulating energy usage of ancillary
equipment, DOE could disincentivize
the manufacturing of such equipment.
If, and to the extent that, ice dispensing
equipment use electricity, such
electricity usage is not covered by this
rulemaking.
B. Market and Technology Assessment
When beginning an energy
conservation standards rulemaking,
DOE develops information that provides
an overall picture of the market for the
equipment concerned, including the
purpose of the equipment, the industry
structure, and market characteristics.
This activity includes both quantitative
and qualitative assessments based
primarily on publicly available
information (e.g., manufacturer
specification sheets, industry
publications) and data submitted by
manufacturers, trade associations, and
other stakeholders. The subjects
addressed in the market and technology
assessment for this rulemaking include:
(1) Quantities and types of equipment
sold and offered for sale; (2) retail
market trends; (3) equipment covered by
the rulemaking; (4) equipment classes;
(5) manufacturers; (6) regulatory
requirements and non-regulatory
programs (such as rebate programs and
tax credits); and (7) technologies that
could improve the energy efficiency of
the equipment under examination. DOE
researched manufacturers of automatic
commercial ice makers and made a
particular effort to identify and
characterize small business
manufacturers. See chapter 3 of the
NOPR TSD for further discussion of the
market and technology assessment.
1. Equipment Classes
In evaluating and establishing energy
conservation standards, DOE generally
divides covered equipment into classes
by the type of energy used, or by
capacity or another performance-related
feature that justifies a different standard
for equipment having such a feature. (42
U.S.C. 6295(q) and 6313(d)(4)) In
deciding whether a feature justifies a
different standard, DOE must consider
factors such as the utility of the feature
to users. Id. DOE normally establishes
different energy conservation standards
for different equipment classes based on
these criteria.
Automatic commercial ice makers are
divided into equipment classes based on
physical characteristics that affect
commercial application, equipment
utility, and equipment efficiency. These
equipment classes are based on the
following criteria:
• Ice-making process
Æ ‘‘Batch’’ icemakers that operate on
a cyclical basis, alternating between
periods of ice production and ice
harvesting
Æ ‘‘Continuous’’ icemakers that can
produce and harvest ice
simultaneously
• Equipment configuration
Æ Ice-making head (a single-package
ice-making assembly that does not
include an ice storage bin)
Æ Remote condensing
D With remote compressor (compressor
packaged with the condenser)
D Without remote compressor
(compressor packaged with the
evaporator)
Æ Self-contained (with storage bin
included)
• Condenser cooling
Æ Air-cooled
Æ Water-cooled
• Capacity range
Table IV.1 shows the 25 automatic
commercial ice maker equipment
classes that DOE is including in the
scope of this rulemaking. The capacity
ranges for the continuous units have
changed from the preliminary analysis.
TABLE IV.1—AUTOMATIC COMMERCIAL ICE MAKER EQUIPMENT CLASSES
Equipment type
Type of
condenser
cooling
Ice-Making Head ................................................................................
Water .........
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Type of ice maker
Air ..............
Batch ............................................
Remote Condensing (but not remote compressor) ............................
Air ..............
Remote Condensing and Remote Compressor .................................
Air ..............
22 A notation in the form ‘‘Scotsman, Public
Meeting Transcript, No. 42 at p. 26’’ identifies a
comment that DOE has received during a public
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meeting and has included in the docket of this
rulemaking at www.regulations.gov. This particular
notation refers to a comment: (1) Submitted by
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Rated harvest rate
lb ice/24 hours
≥50 and <500
≥500 and <1,436
≥1,436 and <4,000
≥50 and <450
≥450 and <4,000
≥50 and <1,000
≥1,000 and <4,000
≥50 and <934
≥934 and <4,000
Scotsman; (2) transcribed from the public meeting
in document number 42 of the docket, and (3)
appearing on page 26 of that document.
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TABLE IV.1—AUTOMATIC COMMERCIAL ICE MAKER EQUIPMENT CLASSES—Continued
Equipment type
Type of
condenser
cooling
Self-Contained Unit ............................................................................
Water .........
Type of ice maker
Air ..............
Ice-Making Head ................................................................................
Water .........
Air ..............
Remote Condensing (but not remote compressor) ............................
Remote Condensing and Remote Compressor .................................
Air ..............
Self-Contained Unit ............................................................................
Continuous ...................................
Air ..............
Water .........
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Air ..............
Batch type and continuous type ice
makers are distinguished by the
mechanics of their respective icemaking processes. Continuous type ice
makers are so named because they
simultaneously produce and harvest ice
in one continuous, steady-state process.
The ice produced in continuous
processes is called ‘‘flake’’ or ‘‘nugget’’
ice, which is often a ‘‘soft’’ ice with high
liquid water content, in the range from
10 to 35 percent, but can also be
subcooled, i.e., be entirely frozen and at
temperature lower than 32 °F.
Continuous type ice makers were not
included in the EPACT 2005 standards
and are therefore not currently regulated
by DOE energy conservation standards.
Current energy conservation
standards cover batch type ice makers
that produce ‘‘cube’’ ice, which is
defined as ice that is fairly uniform,
hard, solid, usually clear, and generally
weighs less than two ounces (60 grams)
per piece, as distinguished from flake,
crushed, or fragmented ice. 10 CFR
431.132 Batch ice makers alternate
between freezing and harvesting periods
and therefore produce ice in discrete
batches rather than in a continuous
process. After the freeze period, hot gas
is typically redirected from the
compressor discharge to the evaporator,
melting the surface of the ice cubes that
is in contact with the evaporator
surface, enabling them to be removed
from the evaporator. The evaporator is
then purged with potable water, which
removes impurities that would decrease
ice clarity. Consequently, batch type ice
makers typically have higher potable
water usage than continuous type ice
makers.
After the publication of the
Framework document, several parties
commented that machines producing
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‘‘tube’’ ice, which is created in a batch
process identical to that which produces
cube ice, should also be regulated. DOE
notes that tube ice machines of the
covered capacity range that produce ice
fitting the definition for cube type ice
are covered by the current standards,
whether or not they are referred to as
cube type ice makers within the
industry. Nonetheless, DOE has
addressed the commenters’ suggestions
by emphasizing that all batch type ice
machines are within the scope of this
rulemaking, as long as they fall within
the covered capacity range of 50 to
4,000 lb ice/24 hours. This includes
tube ice makers and other batch type ice
machines (if any) that produce ice that
does not fit the definition of cube type
ice. To help clarify this issue, DOE now
refers to all batch automatic commercial
ice makers as ‘‘batch type ice makers,’’
regardless of the shape of the ice pieces
that they produce. 77 FR 1591 (Jan. 11,
2012).
During the February 2012 preliminary
analysis public meeting and in
subsequent written comments, a number
of stakeholders addressed issues related
to proposed equipment classes and the
inclusion of certain types of equipment
in the analysis. These topics are
discussed in this section.
a. Cabinet Size
Currently, DOE does not consider
physical size as a criterion for setting
equipment classes.
Several stakeholders commented on
the size standardization of ice makers.
Scotsman commented that most ice
makers are built in standard widths of
22, 30, and 48 inches and standard
depths between 24 and 28 inches,
although heights may vary slightly
depending on the machine. (Scotsman,
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Rated harvest rate
lb ice/24 hours
≥50 and <200
≥200 and <4,000
≥50 and <175
≥175 and <4,000
≥50 and <900
≥900 and <4,000
≥50 and <700
≥700 and <4,000
≥50 and <850
≥850 and <4,000
≥50 and <850
≥850 and <4,000
≥50 and <900
≥900 and <4,000
≥50 and <700
≥700 and <4,000
Public Meeting Transcript, No. 42 at p.
61) Manitowoc noted that the reason for
this standardization is that most ice
storage bins have standard sizes based
on ice-making capacity, and the
footprint of the ice maker on top needs
to be the same as the footprint of the
storage bin in order for them to fit
together. Hence, according to
Manitowoc, the industry has developed
common sizes that have facilitated ice
maker installations and replacements.
(Manitowoc, Public Meeting Transcript,
No. 42 at pp. 91–92) Howe countered
that, contrary to the assertions of other
stakeholders, there are no ‘‘standard’’
ice maker dimensions. (Howe, No. 51 at
pp. 1–2)
Earthjustice commented that it may be
helpful to use cabinet size as an
additional criterion for defining
equipment classes because the existing
standard sizes of ice makers affect their
efficiency and their utility to the
consumer, both of which are factors that
DOE typically considers in identifying
equipment classes. (Earthjustice, Public
Meeting Transcript, No. 42 at pp. 90–91)
However, Manitowoc commented that
it manufactures ice makers in different
cabinet sizes that deliver the same icemaking capacity, explaining that this
facilitates flexible installation decisions
but could complicate efforts to define
equipment classes by cabinet size.
(Manitowoc, Public Meeting Transcript,
No. 42 at p. 91)
The Appliance Standards Awareness
Project (ASAP) commented that it
would be helpful to see a size analysis
that would elucidate the effects of size
on utility to the customer and potential
energy savings. (ASAP, Public Meeting
Transcript, No. 42 at pp. 73–74)
As noted by Manitowoc and
Scotsman, there are standard sizes for
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ice makers. DOE’s review of product
literature supports these claims, in
contrast to Howe’s assertion that there
are no standard sizes. However, not all
customers face size constraints.
DOE notes that a reason to consider
separate equipment classes based on
physical dimensions is to address
differences in energy efficiency. An
important size-related factor that can
affect the efficiency of an ice maker is
the size of its heat exchangers (i.e., the
evaporator and condenser).23 A larger
evaporator can make more ice per freeze
cycle. Hence, for a given harvest
capacity rate, the cycle can be allowed
to take longer, thus reducing the
required heat transfer rate per
evaporator surface. The reduced heat
transfer rate can be provided by a lower
temperature differential between the ice
and the refrigerant. Likewise, as the
surface area of a condenser increases,
the temperature differential between the
refrigerant and the cooling medium
(either air or water) decreases. These
design changes can lead to higher
evaporating temperature and lower
condensing temperature, which both
reduce the pressure differential between
the compressor suction and discharge
ports, which reduces the amount of
electrical power necessary to compress
the vapor, thus reducing energy
consumption of the ice maker.
To address size limitations and to
save energy, DOE could consider
Earthjustice’s recommendation to use
size as a criterion in setting equipment
classes. To do so, DOE could establish
parallel sets of equipment classes—sizeconstrained classes (in which physical
size would be limited to a prescribed
maximum) and non-size-constrained
classes (for which there would be no
size restrictions). In the size-constrained
classes, DOE’s ability to set stricter
energy usage limits would be limited by
the constraint that the physical size of
the unit cannot be increased. In the nonsize-constrained classes, additional
energy savings could be achieved by
setting standards that increase the
physical size of the unit as well as
making the units more efficient.
Accounting for size constraints is
important in the automatic commercial
ice maker industry because replacement
sales comprise a majority of sales and
equipment must be able to fit into the
same space as the unit it replaces, and
fit on existing ice storage bins, as
described above. For opportunities in
which physical size is not critical, non23 Other examples are use of some higherefficiency compressors, which can be physically
larger, and packaging of drain water heat
exchangers within the equipment package.
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size-constrained equipment classes
could save energy relative to the sizeconstrained units. If DOE decided not to
establish separate equipment classes for
space-constrained equipment, it may
not be reasonable for DOE to consider
design options that significantly
increase physical size of the equipment,
which would limit potential efficiency
gains and/or make them more costly,
thus likely resulting in less stringent
standards for size-limited equipment
classes.
Previous DOE rulemakings provide
ample precedent for creating spaceconstrained equipment classes. For
instance, DOE developed spaceconstrained equipment classes for
packaged terminal air conditioners and
through-the-wall air conditioners, both
of which represent industries in which
replacement comprises a majority of
sales. 10 CFR 430.32
To determine whether space
constraint is an issue (i.e., whether
efficiency and physical size are direct
functions of one another), DOE followed
ASAP’s suggestion and prepared an
analysis of the size and efficiency of
automatic commercial ice makers. Using
publicly available manufacturer
information, DOE collected size 24 data
for approximately 600 ice makers and
mapped it to efficiency information
listed in the AHRI database. After
plotting and analyzing this data, DOE
determined that, although there is a
correlation between size and efficiency
in automatic commercial ice makers,
this correlation is not conclusive.
Table IV.2 displays sample results of
this size analysis, presenting
information for two different large, aircooled IMH batch type ice makers at
each of several selected harvest
capacities. In many cases, the larger
equipment is more efficient. For
example, among the ice makers that can
produce 1,500 lb ice/24 hours, the 28 ft3
products have total energy consumption
values that are lower than the current
energy consumption standard by greater
than >20 percent, while the 19 ft3
products have total energy consumption
values that are only 6 percent below the
standard. In other cases, the data do not
support this trend. For example, among
the 800 lb ice/24 hour ice makers, the
17 ft3 products are less efficient than the
11 ft3 products. Finally, in cases such as
the 1,430 lb ice/24 hour machines, there
are also products with the same harvest
capacity and volume that nonetheless
have different efficiencies. Therefore, it
24 Size is expressed in terms of volume,
calculated by multiplying unit width by unit depth
and by unit height (width × depth × height).
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is difficult to draw a decisive
conclusion from this data.
TABLE IV.2—RELATIONSHIP BETWEEN
VOLUME AND EFFICIENCY FOR
LARGE IMH AIR-COOLED BATCH ICE
MAKERS
Rated harvest rate
lb ice/24
hours
500 ............
800 ............
1,150 .........
1,430 .........
1,530 .........
Volume
ft 3
% Below
baseline
energy use
(percent)
9.1
12.4
10.8
16.8
18.0
20.8
20.1
20.1
19.3
27.7
3.2
2.2
13.5
3.5
13.5
18.1
3.0
4.6
6.0
21.3
Manitowoc noted during the February
2012 preliminary analysis public
meeting that it produces units with the
same harvest rate in different size
chassis sizes, and that these units have
very similar features. (Manitowoc,
Public Meeting Transcript, No. 42 at p.
91) DOE, in its analysis, has noted that
some manufacturers have achieved
higher efficiencies for ice makers in
smaller sizes (at constant harvest rates).
Based on this information, DOE believes
that size does affect efficiency levels (as
it allows for large heat exchangers), but
it is not the definitive factor in
determining efficiency for ice makers.
Therefore, DOE has determined that
separate equipment classes for sizeconstrained units are not warranted.
DOE notes that there is not a strong
correlation between product size and
product efficiency that supports
separate equipment classes.
Furthermore, DOE believes that adding
additional classes for size-constrained
units complicates the equipment class
structure and analysis but does not
improve the rulemaking or standards.
b. Large-Capacity Batch Ice Makers
In the November 2010 Framework
document for this rulemaking, DOE
requested comments on whether
coverage should be expanded from the
current covered capacity range of 50 to
2,500 lb ice/24 hours to include ice
makers producing up to 10,000 lb ice/
24 hours. All commenters agreed with
expanding the harvest capacity
coverage, and all but one of the
commenters supported or accepted an
upper harvest capacity cap of 4,000 lb
ice/24 hours, which would be consistent
with the current test procedure, AHRI
Standard 810–2007. Most commenters
categorized ice makers with harvest
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capacities above 4,000 lb ice/24 hours as
industrial rather than commercial. To be
consistent with the majority of these
comments, DOE proposed during the
preliminary analysis to set the upper
harvest capacity limit to 4,000 lb ice/24
hours, even though there are few ice
makers currently produced with
capacities ranging from 2,500 to 4,000 lb
ice/24 hours. 77 FR 3405 (Jan. 24, 2012)
Since the publication of the preliminary
analysis, DOE revised the test
procedure, with the final rule published
in January 2012, to include all batch and
continuous type ice makers with
capacities between 50 and 4,000 lb ice/
24 hours. 77 FR 1591, 1613–14 (Jan. 11,
2012). In the 2012 test procedure final
rule, DOE noted that 4,000 lb ice/24
hours represented a reasonable limit for
commercial ice makers, as larger-sized
ice makers were generally used for
industrial applications and testing
machines up to 4,000 lb was consistent
with AHRI 810–2007. 77 FR 1591 (Jan.
11, 2012). Therefore, because DOE now
has a procedure for testing ice makers
with capacities up to 4,000 lb ice/24
hours, DOE proposes in this NOPR to
set efficiency standards that include all
ice makers in this extended capacity
range.
In written comments after the
publication of the preliminary analysis,
AHRI and Manitowoc both
recommended that DOE refrain from
regulating products with capacities
above 2,500 lb ice/24 hours if there are
not enough high-capacity batch
machines available for DOE to analyze.
(AHRI, No. 49 at pp. 3–4; Manitowoc,
No. 54 at p. 3)
DOE acknowledges that there are
currently few automatic commercial ice
makers with harvest capacities above
2,500 lb ice/24 hours. However, DOE
already has a precedent of setting
standards for harvest capacity ranges in
which there are no products available.
There are currently no IMH air-cooled
ice makers on the market with harvest
capacities above 1,650 lb ice/24 hours,
yet EPACT 2005 amended EPCA to set
standards for this equipment class of ice
makers with harvest capacities up to
2,500 lb ice/24 hours. Because it is
possible that batch-type ice makers with
harvest capacities from 2,500 to 4,000 lb
ice/24 hours will be manufactured in
the future, DOE does not find it
unreasonable to set standards in this
rulemaking for batch type ice makers
with harvest capacities in the range up
to 4,000 lb ice/24 hours. Therefore, DOE
maintains its position to include largecapacity batch type ice makers in the
scope of this rulemaking. However, DOE
requests comment and data on the
viability of the proposed standard levels
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selected for batch-type ice makers with
harvest capacities from 2,500 to 4,000 lb
ice/24 hours. The proposed standard
levels are discussed in Section V.A.2 of
today’s NOPR.
c. Efficiency/Harvest Capacity
Relationship
In the current energy conservation
standards, DOE uses discrete harvest
capacity breakpoints to differentiate
cube machine classes, and DOE
proposes to do the same with new
classes for continuous machines.
In reviewing industry literature, DOE
found that compressor efficiency
increases over a range of harvest rate
capacities and then tends to flatten out
at the higher capacities. This trend is
illustrated in Table IV.3, which displays
the capacities and energy efficiency
ratios (EERs) of one family of
reciprocating compressors. As shown in
this table, the EERs of compressors in
this family level off to between 6.5 and
7.2 British thermal units per watt-hour
(Btu/Wh) at capacities beyond 14,300
Btu per hour.
TABLE IV.3—RELATIONSHIP OF
COMPRESSOR CAPACITY TO EER
Capacity
Btu/hr
EER
Btu/Wh
7,970
8,440
8,840
9,870
10,200
10,900
11,300
12,400
12,900
14,100
14,300
14,900
18,100
18,300
18,600
19,600
22,200
22,500
24,300
24,600
26,000
29,300
29,600
30,500
31,300
34,400
36,700
42,200
5.8
5.1
6.0
6.2
5.5
6.3
5.5
7.0
6.0
5.9
6.5
6.6
7.0
6.5
6.6
5.6
6.5
7.2
7.1
6.6
6.5
6.7
6.6
6.7
6.9
6.7
6.7
6.8
Due primarily to the compressor
trends discussed above, ice maker
energy usage also varies as products
increase in cooling capacity. Ice maker
energy use (in kilowatt-hours per 100 lb
of ice) decreases as the harvest rate
increases in all products, but because
the compressor trends do not continue
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indefinitely, the ice maker energy usage
becomes constant at larger harvest rates.
The point at which usage becomes
constant for ice makers varies by
equipment type.
DOE has traditionally used a
piecewise linear approach 25 to depict
the standard levels, with the
breakpoints defining the harvest
capacity rate limits of different
equipment classes. Thus, for the current
energy conservation standards for batch
type equipment, the maximum
allowable energy use declines as harvest
capacity increases for the smallest
harvest capacity rate equipment classes.
In contrast, for most of the larger harvest
capacity rate equipment classes, the
maximum allowable energy use is a
constant. The one exception is the large
IMH air-cooled equipment class, where
the maximum allowable energy use
continues to decrease as harvest
capacity rate increases. DOE believes
that its piecewise energy consumption
limits facilitate the simple calculation of
energy standards while accurately
depicting the complex relationship
between capacity and efficiency.
Several stakeholders commented on
DOE’s decision to set piecewise
efficiency levels according to harvest
capacity. At the February 2012
preliminary analysis public meeting, the
Northwest Power and Conservation
Council (NPCC) questioned whether
setting standards by capacity range
would create discontinuous breakpoints
in efficiency requirements that would
drive manufacturers to seek one level of
capacity over another to take advantage
of a more favorable standard. (NPCC,
Public Meeting Transcript, No. 42 at p.
22) In written comments, the Northwest
Energy Efficiency Alliance (NEEA),
NPCC, and the California InvestorOwned Utilities (CA IOUs)
recommended that DOE imitate
ENERGY STAR® and use a single
equation for each equipment class to
define energy consumption standards as
a function of harvest rate, rather than
having multiple efficiency standards for
different harvest capacity bins. (NEEA/
NPCC, No. 50 at p. 2; CA IOUs, No. 56
at p. 2) CA IOUs added that, if DOE
elects to continue distinguishing
equipment classes based on harvest
capacity breakpoints, it should explain
25 A piecewise function is a mathematical
relationship where the relationship between the
independent variable and dependent variable varies
over the inspected range. Different functions are
used to describe this relationship for each discrete
interval where this relationship is defined. The
piecewise function is a way of expressing the full
relationship (https://mathworld.wolfram.com/
PiecewiseFunction.html).
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its reasoning for doing so. (CA IOUs, No.
56 at p. 3)
The newly finalized ENERGY STAR
specification eliminates discontinuities
by using one equation for IMH and selfcontained cube equipment as well as all
three continuous equipment types,
while achieving something similar to
the asymptotic relationship mentioned
by Manitowoc. The ENERGY STAR
specification accomplishes this with
equations that are more complex than
those currently embodied in DOE’s cube
ice machine standards, which have
simple ‘‘intercept and slope’’ or ‘‘fixed
and variable’’ components. For example,
DOE’s current energy consumption limit
for small IMH air-cooled equipment is
as follows:
Maximum Energy Usage (kWh) ≤ 10.26
¥ 0.0086H
(Where H = harvest rate capacity, up to
449 lb ice/24 hours)
The April 30, 2012 ENERGY STAR
specification for the same equipment is:
Maximum Energy Usage (kWh) ≤
37.72H¥0.298
By means of a more complicated
formula, the ENERGY STAR
specification creates a continuous curve
while still respecting the asymptotic
relationship between efficiency and
harvest capacity.
Manitowoc commented that it was not
particularly important where the DOE
places capacity breakpoints for different
equipment classes as long as the
breakpoints respect the asymptotic
relationships between size and
efficiency. Manitowoc also asked that
there not be any real discontinuities at
these breakpoints or discrepancies from
the industry mean efficiency/capacity
relationships. (Manitowoc, Public
Meeting Transcript, No. 42 at pp. 25–26)
CA IOUs similarly requested that DOE
base its harvest capacity breakpoints on
an investigation of the market, rather
than automatically using pre-existing
breakpoints, and added that any new
equipment classes generated by
resetting these breakpoints must not
allow backsliding. (CA IOUs, No. 56 at
p. 3)
The issue raised by NPCC and echoed
by Manitowoc is that the equations used
in the standards can cause points of
discontinuity where rating equipment at
slightly different capacity levels
provides a benefit to the manufacturer
in terms of allowable energy usage. In
the current standards for IMH watercooled units, one discontinuity exists at
500 lb ice/24 hours, the breakpoint
between the small and medium harvest
capacity rate equipment classes, where
there is a 0.1 kWh/100 lb energy use
gap, representing 2.0 percent of the 5.04
kWh/100 lb maximum allowable energy
use at this harvest capacity rate.
However, eliminating this type of gap in
the energy conservation standards
would not require departure from a
piecewise linear representation of
maximum allowable energy use.
Fitting a curve as was done to create
the ENERGY STAR limits would be
more complicated than creating a new
standard that mirrors the existing usage
limit structure. It would also be more
difficult for customers, such as
restaurant owners, who buy ice makers
and need to make sense of the standards
because the ENERGY STAR equation
requires a calculator or a spreadsheet,
and, DOE believes, leads to more
questions and complexity.
The single equation approach also
runs somewhat contrary to the
comments received from manufacturers.
With the single equation provided by
ENERGY STAR, energy usage limits for
large machines continue to decline to
zero (albeit at diminishing rates). The
manufacturer comments cited in the
discussion of large machines above
provided several reasons that, at very
high capacities, design constraints cause
these products to have constant energy
usage across different harvest capacities.
This means that, at a certain point,
efficiency tends to become more
constant as harvest capacity changes, as
is embodied in the current standards.
The single equation approach would
make it more difficult for the DOE
standards to reflect this trend in the
market.
DOE has decided to continue
structuring the equipment classes by
utilizing multiple harvest rate sizes
rather than moving to a single equation
approach. By continuing to use multiple
size classes, DOE will have greater
flexibility to adequately address the
efficiencies of large equipment classes.
The risk of exploiting the system at size
class break points can be mitigated by
carefully developing standards.
Moreover, DOE proposes amending the
baseline energy standards to eliminate
existing discontinuities at harvest
capacity breakpoints. Note that under
the DOE test procedure and specifically
the updated ANSI/ASHRAE Standard
29–2009 that was incorporated by
reference in that rule, harvest rates are
to be determined at the time of test, and
are not based on manufacturer
specifications. (10 CFR 431.134)
Furthermore, in EPACT 2005, Congress
directed DOE to monitor whether
manufacturers reduce harvest rates
below tested values for the purpose of
bringing non-complying equipment into
compliance. (42 U.S.C. 6316(f)(4)(A))
DOE therefore intends to carefully
assess whether such manipulation
occurs as a result of any final rule using
distinct break points.
AHRI Standard 810–2007, as
referenced by the DOE test procedure,
states that the energy consumption rate
of ice makers should be rounded to the
nearest 0.1 kWh. By considering the
standard levels using this rounding
convention, the only existing
discontinuity in DOE’s standards for
batch type ice makers occurs at the
breakpoint of 500 lb/24 hr between the
IMH–W–Small–B and IMH–W–
Medium–B equipment classes. In its
analysis, DOE adjusted the baseline
energy level for the IMH–W–Small–B
equipment class to 7.79–0.0055H from
7.80–0.0055H. This 0.01 change
eliminates the discontinuity at this
breakpoint, as seen in Table IV.4. In
setting up TSLs, DOE sought to ensure
that no discontinuities existed between
equipment classes.
TABLE IV.4—CURRENT STANDARD AND DOE ENGINEERING BASELINE FOR IMH–W–SMALL–B EQUIPMENT TYPE
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Equipment type
Current baseline
(7.80–0.0055H)
IMH–W–Small–B .................................................................
5.1 (rounded from 5.050) ...................................................
IMH–W–Medium–B .............................................................
5.0 (rounded from 5.030) ...................................................
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5.040).
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d. Continuous Ice Maker Equipment
Classes
The EPACT 2005 amendments to
EPCA did not set standards for
continuous type ice makers. At the
February 2012 preliminary analysis
public meeting, DOE presented NES
results (see section IV.H.3 of this notice)
that indicated the continuous
equipment type accounted for
approximately 0.03 quads of savings
potential over the 30-year analysis
period. The savings levels are low
primarily because continuous type icemaking machines represent only 16
percent of automatic commercial ice
maker shipments, of which only two
equipment classes (IMH air-cooled
small and self-contained air-cooled
small equipment) represent threequarters of shipments.
At the February 2012 preliminary
analysis public meeting and in written
comments, AHRI and Scotsman both
questioned the need to regulate
continuous type ice makers, noting that
the preliminary results of DOE’s
national impact analysis show
negligible NES (rounding to 0.000
quads) for most continuous type
equipment classes. (AHRI, No. 49 at
pp. 1–2; Scotsman, No. 46 at p. 5;
Scotsman, Public Meeting Transcript,
No. 42 at p. 105)
AHRI and Scotsman questioned the
need to include continuous remote
condensing units (RCUs) with remote
compressors as equipment classes,
noting that these are niche products that
represent a very small portion of the
overall market. AHRI added that their
minimal projected energy savings and
low shipment volume would not justify
the cost of testing and certifying these
products to DOE. (AHRI, No. 49 at p. 3;
Scotsman, No. 46 at p. 2)
Pursuant to EPCA, DOE is required to
set new or amended energy
conservation standards for automatic
commercial ice makers to: (1) Achieve
the maximum improvement in energy
efficiency that is technologically
feasible and economically justified; and
(2) result in significant conservation of
energy. (42 U.S.C. 6295(o)(2)(A) and
(o)(3)(B); 6313(d)(4)) The EPCA
language does not require DOE to
determine the significance of savings at
the individual equipment class level in
order to justify setting standards for all
equipment classes of an equipment type
DOE has decided to regulate all
automatic commercial ice maker
equipment classes. This will bring two
important automatic commercial ice
maker classes (self-contained, air-cooled
small continuous and IMH air-cooled
small continuous) under regulation.
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Regulating all equipment classes will
create a consistent approach for
regulating continuous type equipment
as was done for batch type equipment.
e. Remote Condensing Unit Classes for
Equipment With and Without Remote
Compressors
The current standard levels
differentiate between remote condensers
with compressors in the condenser
cabinet and remote condensers without
remote compressors. DOE requested
comment on whether to retain these
equipment classes as separate groups.
(DOE, Public Meeting Presentation,
No. 7 at p. 30)
Numerous stakeholders expressed
their support for DOE’s differentiation
of RCUs into two separate classes based
on the location of their compressors.
Manitowoc raised the issue at the public
meeting, noting that locating the
compressor remotely has a measurable
impact on the overall efficiency of an
ice maker. (Manitowoc, Public Meeting
Transcript, No. 42 at pp. 24–25)
Scotsman added that these two classes
of RCUs perform at different efficiencies
in the field and provide different utility
to the customer, thus justifying their
separation into separate equipment
classes. (Scotsman, Public Meeting
Transcript, No. 42 at p. 45 and No. 46
at p. 2) NPCC expressed agreement with
Scotsman’s comment on the issue.
(NPCC, Public Meeting Transcript,
No. 42 at p. 45)
Based on DOE’s review of these
comments and data arising from the
analyses, DOE believes the location of
the compressor provides different
customer utility, and that each
equipment class experiences different
energy usage trends due to suction line
losses. DOE did not receive any
information indicating that these
equipment classes should not be kept
separate. Therefore, DOE will continue
to categorize RCUs with and without
remote compressors into separate
equipment classes.
f. Remote to Rack Equipment
In the preliminary analysis, DOE
found that some high-capacity RCU–
RC–Large–C ice makers are solely
designed to be used with compressor
racks and the racks’ associated
condensers. A compressor rack is
typically used with supermarket
refrigeration equipment and consists of
several compressors joined in a parallel
arrangement to service several
refrigeration products at once. One
related issue is that the manufacturers of
these automatic commercial ice makers
do not provide for sale a condensing
unit that could be paired with them as
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an alternative option. DOE noted that
these units do not meet the statutory
definition of ice makers, which states
that an ice maker ‘‘consists of a
condensing unit and ice-making section
operating as an integrated unit, with
means for making and harvesting ice.’’
(42 U.S.C. 6311(19)(A)) Hence, DOE
determined during the preliminary
analysis that rack-only RCUs are not
defined as ice makers under the statute
and thus should not be included in this
rulemaking.
Howe recommended that DOE
include remote to rack ice makers in the
rulemaking because such units already
represent a significant fraction of annual
ice maker shipments and will become
even more significant once the covered
capacity range expands to 4,000 lb ice/
24 hours. (Howe, No. 51 at p. 4)
Conversely, Scotsman commented that
continuous RCUs with remote
compressors comprise a very tiny piece
of the overall automatic commercial ice
maker market and thus questioned the
need to establish equipment classes for
these products. Scotsman added that
these RCUs are difficult to test 26
because they are designed to be
connected to supermarket rack systems.
(Scotsman, No. 46 at p. 2)
Earthjustice observed that DOE has
not explained why it believes that ice
makers designed for use with remote
condenser rack systems do not consist
of ‘‘a condensing unit and ice-making
section operating as an integrated unit,
with means for making and harvesting
ice,’’ as automatic commercial ice
makers are defined. Earthjustice argued
that such ice makers use the same basic
components, including both a
condensing unit and an ice-making
section. Moreover, Earthjustice
continued, the two components are
directly connected, and their integration
is not nullified by the fact that other
equipment may also be connected to the
supermarket rack. Earthjustice added
that DOE has long regulated split system
residential and commercial air
conditioners despite the fact that the
outdoor and indoor components are
frequently made by different firms.
(Earthjustice, No. 47 at p. 5)
Given the small market share of large
continuous RCU remote compressor
equipment (0.35 percent), DOE finds
that Scotsman’s claim is credible in that
continuous, rack-only equipment
comprises only a fraction of the 0.35
percent, and thus a tiny piece of the
overall market.
26 The current and recently completed DOE test
procedures do not provide test procedures for this
type of equipment.
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The Earthjustice comment drawing a
parallel to split system residential air
conditioners overlooks key distinctions.
Residential equipment may pair
components from different
manufacturers, but only one
manufacturer is responsible for the
certification.27 Supermarket racks
simultaneously serve multiple units of
equipment (including commercial
refrigerators and freezers, walk-in
coolers and freezers, ice makers, air
conditioners, and heat pumps), so there
is no way to hold one manufacturer
responsible for certifying its energy
consumption. Drawing a parallel
between these two circumstances is
therefore not reasonable in that respect.
Therefore, DOE decided to maintain
its position not to cover rack-only RCU
units in this standards rulemaking. DOE
does request comment and supporting
data on the overall market share of these
units and any expected market trends.
g. Ice Makers Covered by the Energy
Policy Act of 2005
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Of the 25 equipment classes that DOE
is considering in this rulemaking, 13 are
already covered under energy
conservation standards that were set for
cube type ice makers as part of EPACT
2005. Current automatic commercial ice
maker standards covering cube type ice
makers took effect on January 1, 2010.
Under the requirements of EPCA, DOE
must review and make a determination
as to whether amendments to the
standards are technologically and
economically justified by January 1,
2015. (42 U.S.C. 6313(d)(3)(A))
In written comments, AHRI opined
that, because the full effects of the
EPACT 2005 ruling will not be known
until at least 2013, DOE should only
consider the previously uncovered
continuous and high-capacity batch
type ice makers in this rulemaking.
(AHRI, No. 49 at p. 3) Similarly,
Hoshizaki asked DOE not to adjust the
energy standards for automatic
commercial ice makers that are
currently covered, arguing that
tightening the regulations that were just
released two years ago would negatively
27 Under DOE regulations, it is possible for more
than one central air conditioner manufacturer to
submit certification reports for a given condensing
unit. 10 CFR 429.16 requires manufacturers of
central air conditioners to certify compliance with
the energy conservation standards to DOE. Where
a coil manufacturer may offer a coil for sale to be
matched with a condensing unit made by another
manufacturer (mix-matched combination), the coil
manufacturer can make representations for
condensing unit coil combination, but, since the
condensing unit manufacturer does not offer for
sale the mixed-matched combination, only the coil
manufacturer offering the combination for sale is
responsible for certification of that combination.
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impact both manufacturers and end
users. (Hoshizaki, No. 53 at p. 3)
DOE is required by statute to review
the standards and, if amended standards
are technologically feasible and
economically justified, to issue a rule to
amend the standards. (42 U.S.C.
6313(d)(3)(A))
Manufacturers have asserted that the
automatic commercial ice maker
industry is a small component of the
commercial refrigeration industry, and
that given their size they have little or
no influence with the manufacturers of
major components such as compressors.
(Manitowoc, Public Meeting Transcript,
No. 42 at pp. 14–15) Manufacturers
noted that they are generally restricted
to design options available to larger
customers. (Manitowoc, Public Meeting
Transcript, No. 42 at pp. 15)
Consistent with the comments from
manufacturers, DOE’s engineering
analysis included design options that
are viable for automatic commercial ice
makers. Most of the design options are
extensively used in existing products,
and a few design options (brushless DC
motors) are available but rarely
implemented in this equipment.
Chapter 5 of the NOPR TSD contains
further details of the analysis for each
design option used.
DOE has alternatives with respect to
the date that new standards would take
effect. EPCA requires that the amended
standards established in this rulemaking
must apply to equipment that is
manufactured on or after 3 years after
the final rule is published in the Federal
Register unless DOE determines, by
rule, that a 3-year period is inadequate,
in which case DOE may extend the
compliance date for that standard by an
additional 2 years. (42 U.S.C.
6313(d)(3)(C))
For the NOPR analyses, DOE assumed
a 3-year period to prepare for
compliance. DOE requests comments on
whether a January 1, 2018 effective date
provides an inadequate period for
compliance and what economic impacts
would be mitigated by a later effective
date.
DOE also requests comment on
whether the 3-year period is adequate
for manufacturers to obtain more
efficient components from suppliers to
meet proposed revisions of standards.
h. Regulation of Potable Water Use
Under EPACT 2005, water used for
ice—referred to as potable water—was
not regulated for automatic commercial
ice makers.
The amount of potable water used
varies significantly among batch type
automatic commercial ice makers (i.e.,
cube, tube, or cracked ice machines).
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Continuous type ice makers (i.e., flake
and nugget machines) convert
essentially all of the potable water to
ice, using roughly 12 gallons of water to
make 100 lb of ice. Batch type ice
makers use an additional 3 to 38 gallons
of water in the process of making 100
lb of ice. This additional water is
referred to as ‘‘dump or purge water’’
and is used to cleanse the evaporator of
impurities that could interfere with the
ice-making process.
The Alliance for Water Efficiency
(Alliance), the Natural Resources
Defense Council (NRDC), and CA IOUs
proposed that DOE regulate the water
use of automatic commercial ice makers.
(Alliance, No. 45 at pp. 3–4; NRDC, No.
48 at p. 2; CA IOUs, No. 56 at p. 6) The
Alliance noted that the potable water
lost from purging represents a waste of
the energy required to pump, treat,
deliver, and dispose of this water on a
national scale. This embedded energy
use, the Alliance argued, gives DOE
justification to include water efficiency
standards along with its energy
efficiency standards for automatic
commercial ice makers. The Alliance
recommended that DOE analyze
technical data from real ice makers in
order to accurately determine the
minimum potable purge water rate
required to prevent scaling. The
Alliance also observed that the huge
variation in potable water use among ice
makers of similar capacities suggests
that some ice makers may be purging
water at excessive rates in order to
overcome poor maintenance practices
and schedules, which is not a justifiable
excuse in the opinion of the Alliance.
(Alliance, No. 45 at pp. 3–4) CA IOUs
also recommended that DOE consider
establishing potable water use limits,
especially because the ENERGY STAR
program already includes such limits.
(CA IOUs, No. 56 at p. 6)
In response to comments from the
Alliance, NRDC, and CA IOUs, DOE was
not given a specific mandate by
Congress to regulate potable water.
EPCA, as amended, explicitly gives DOE
the authority to regulate water use in
showerheads, faucets, water closets, and
urinals (42 U.S.C. 6291(6), 6295(j) and
(k)), clothes washers (42 U.S.C.
6295(g)(9)(B)), dishwashers (42 U.S.C.
6295(g)(10)(B)), commercial clothes
washers (42 U.S.C. 6313(e)), and batch
(cube) commercial ice makers. (42
U.S.C. 6313(d)) With respect to batch
commercial ice makers (cube type
machines), however, Congress explicitly
set standards in EPACT 2005 only for
condenser water use, which appear at
42 U.S.C. 6313(d)(1), and noted in a
footnote to the table that potable water
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use was not included.28 Congress
thereby recognized both types of water,
and did not provide direction to DOE
with respect to potable water standards.
This ambiguity gives the DOE
considerable discretion to regulate or
not regulate potable water. The U.S.
Supreme Court has determined that,
when legislative intent is ambiguous, a
government agency may use its
discretion in interpreting the meaning of
a statute, so long as the interpretation is
reasonable.29 In the case of ice makers,
EPACT 2005 is ambiguous on the
subject of whether DOE must regulate
water usage for purposes other than
condenser water usage in cube-making
machines, so DOE therefore has chosen
to use its discretion not to mandate a
standard in this case. DOE instead
considered potable water use reduction
in batch-type ice makers as a design
option for reducing energy use. DOE
notes that the ENERGY STAR program
has implemented potable water
consumption requirements.
Hoshizaki commented that potable
water use varies from place to place,
depending on water quality, and added
that the market is already dictated to use
less water. (Hoshizaki, Public Meeting
Transcript, No. 42 at p. 73) AHRI added
that limiting potable water use would
decrease ice clarity and increase scaling,
which would subsequently increase the
overall energy use of the ice maker.
Therefore, AHRI and Hoshizaki both
recommended against establishing
maximum potable water use standards
in this rulemaking because of the
reduced utility and efficiency that it
would cause. (AHRI, No. 49 at pp. 2–3;
Hoshizaki, No. 53 at p. 1)
The Hoshizaki and AHRI comments
suggest that DOE intends to implement
potable water use standards, but this is
not the case. Rather, DOE is simply
suggesting that reduction of potable
28 Footnote
to table at 42 U.S.C. 6313(d)(1).
Cable & Telecomms. Ass’n v. Brand X
Internet Servs., 545 U.S. 967, 986 (2005) (quoting
Chevron U.S.A. Inc. v. Natural Res. Def. Council,
Inc., 467 U.S. 837, 845 (1984)).
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29 Nat’l
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water use is a viable technology option
that satisfies the screening analysis
criteria, as long as reductions are not
excessive. This approach does not
establish potable water use maximums
since manufacturers are not required to
use this design option in order to meet
efficiency standards. Scotsman noted
that the ENERGY STAR program has
limited potable water use in ice makers
to 25 gallons per 100 lb of ice and that
the program is moving toward a new
standard of 20 gallons per 100 lb of ice,
which it believes to be the minimum
levels for avoiding machine
performance issues. Scotsman
recommended that DOE refer to these
ENERGY STAR standards in
determining new potable water use
limits. (Scotsman, Public Meeting
Transcript, No. 42 at pp. 64–65 and No.
46 at p. 5) Manitowoc agreed with
Scotsman and added that the new 20
gallons per 100 lb metric was developed
with the aid of manufacturers and that
further reducing potable water use
could impact the long-term reliability of
its machines. Therefore, Manitowoc
stated that 20 gallons per 100 lb is the
lowest water use limit with which it
would be comfortable. (Manitowoc,
Public Meeting Transcript, No. 42 at pp.
65–66)
However, Manitowoc also commented
that potable water use is a variable in
the design process that manufacturers
have already optimized to satisfy a
number of competing factors.
Manitowoc argued that, although
reducing potable water use would
improve machine efficiency up to a
point, it would also decrease reliability
and increase the required frequency for
cleaning due to scaling. Manitowoc
stated that the design limits for potable
water use often depend on proprietary
design elements; therefore, it would be
difficult to set reasonable potable water
use standards that were fair to all
companies, in Manitowoc’s opinion.
(Manitowoc, No. 54 at p. 3)
Howe noted that measuring potable
water use is important because descaling is crucial for maintaining the
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efficiency and utility of automatic
commercial ice makers. Howe also
recommended that DOE obtain
information from additional
manufacturers on the relationship
between potable water use and ice
maker performance. (Howe, No. 51 at p.
2)
DOE has implemented in the analysis
the recommendations of several
stakeholders that 20 gallons per 100 lb
of ice is a reasonable lower limit on
potable water use for batch type ice
makers, especially considering that
there are numerous batch type ice
machines that have potable water use at
this level or lower. For example, in
implementing batch water control as a
design option, DOE is limiting the
reduction in potable water use to 20
gallons per 100 lb. This should not be
confused with the establishment of a
standard—this limit affects the extent to
which a specific design option saves
energy by placing a floor under the
potable water usage. Though NRDC
claims that reducing potable water use
beyond this level would be feasible and
beneficial, it has not identified specific
designs with significantly less potable
water use, nor has it provided data to
show that long-term field use of such
equipment is viable. Chapter 5 of the
NOPR TSD contains more information
about this analysis.
2. Technology Assessment
As part of the market and technology
assessment, DOE developed a
comprehensive list of technologies to
improve the energy efficiency of
automatic commercial ice makers,
shown in Table IV.5. Chapter 3 of the
NOPR TSD contains a detailed
description of each technology that DOE
identified. DOE only considered in its
analysis technologies that would impact
the efficiency rating of equipment as
tested under the DOE test procedure.
The technologies identified by DOE
were carried through to the screening
analysis and are discussed in section
IV.C.
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TABLE IV.5—TECHNOLOGY OPTIONS FOR AUTOMATIC COMMERCIAL ICE MAKERS
Technology options
Condenser ....................................................
Fans and Fan Motors ...................................
Other Motors ................................................
Controls ........................................................
Evaporator ....................................................
Insulation ......................................................
Refrigeration Line .........................................
Potable Water ...............................................
Continuous
ice makers
Improved compressor efficiency .................
Part load operation ......................................
Increased surface area ...............................
Enhanced fin surfaces .................................
Increased air flow ........................................
Increased water flow ...................................
√
√
√
√
√
√
√
√
√
√
√
√
Brazed plate condenser ..............................
Compressor ..................................................
Batch ice
makers
√
√
Microchannel condenser .............................
Higher efficiency condenser fans and fan
motors.
Improved auger motor efficiency .................
Improved pump motor efficiency .................
Smart Technologies ....................................
Design options which reduce energy loss
due to evaporator thermal cycling.
Design options which reduce harvest
meltage or reduce harvest time.
Larger evaporator surface area ..................
Tube evaporator configuration ....................
Improved insulating material and/or thicker
insulation around the evaporator compartment.
Larger diameter suction line ........................
√
√
√
√
........................
√
√
√
√
Reduced potable water flow ........................
Drain water thermal exchange ....................
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a. Reduced Potable Water Flow for
Continuous Type Ice Makers
Howe questioned why the list of
design options for continuous type ice
makers did not include reduced potable
water flow, considering that such
machines can have clean or flush cycles.
(Howe, Public Meeting Transcript, No.
42 at pp. 30–31)
DOE notes that some continuous
machines may include controls or
design options that may reduce potable
water flow. Therefore, DOE has
included reduced potable water flow for
continuous machines as one of its
design options.
DOE also notes that the test procedure
for continuous type ice makers calls for
three 14.4-minute long measurements of
ice-making production and energy use.
The flushing cycles in continuous type
ice makers typically do not occur within
these measurement periods and the
water used for flushing is not captured
in the energy use metric; hence, because
the engineering analysis cannot evaluate
an improvement that occurs outside of
the test procedure, this aspect of
equipment operation was screened out
in the screening analysis.
b. Alternative Refrigerants
Scotsman asked whether hydrocarbon
refrigerants were considered as a design
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option. (Scotsman, Public Meeting
Transcript, No. 42 at p. 32) Manitowoc
responded that hydrocarbon refrigerants
should not be considered in the analysis
because they have not been approved
for use by the U.S. Environmental
Protection Agency’s (EPA’s) Significant
New Alternatives Policy (SNAP).
(Manitowoc, Public Meeting Transcript,
No. 42 at p. 32) AHRI added that
refrigerants that are used as alternatives
to chlorofluorocarbons (CFCs) and
hydrochlorofluorocarbons (HCFCs) must
be approved by both the EPA and the
SNAP program. AHRI noted that,
although some hydrocarbon refrigerants
were approved for use in residential
refrigerators and some commercial
refrigerated display cases, they have not
been approved for ice makers. (AHRI,
Public Meeting Transcript, No. 42 at pp.
32–33)
Manitowoc observed that future
legislation may require the use of
refrigerants that, based on their current
status, have the potential to decrease the
energy efficiency of ice makers.
(Manitowoc, Public Meeting Transcript,
No. 42 at p. 33)
As indicated by AHRI, hydrocarbon
refrigerants have not yet been approved
by the EPA SNAP program and hence
cannot be considered as a technology
option in DOE’s analysis. DOE also
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Air-cooled only.
Air-cooled only.
Water-cooled
only.
Water-cooled
only.
Air-cooled only.
√
√
√
√
√
√
√
√
√
√
√
RCUs with remote compressor.
notes that, while it is possible that
hydrofluorocarbon (HFC) refrigerants
currently used in automatic commercial
ice makers may be restricted by future
legislation, DOE cannot speculate on
such future laws and can only consider
in its rulemakings laws that have been
enacted. This is consistent with past
DOE rulings, such as in the 2011 direct
final rule for room air conditioners. 76
FR 22454 (April 21, 2011). To the extent
that there has been experience within
the industry, domestically or
internationally, with the use of
alternative low-GWP refrigerants, DOE
requests any available information,
specifically cost and efficiency
information relating to use of alternative
refrigerants. DOE acknowledges that
there are government-wide efforts to
reduce emissions of HFCs, and such
actions are being pursued both through
international diplomacy as well as
domestic actions. DOE, in concert with
other relevant agencies, will continue to
work with industry and other
stakeholders to identify safer and more
sustainable alternatives to HFCs while
evaluating energy efficiency standards
for this equipment.
C. Screening Analysis
In the technology assessment section
of this NOPR, DOE presents an initial
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See chapter 4 of the NOPR TSD for
further discussion of the screening
analysis. Additional screening criteria
include whether a design option is
expected to save energy or whether
savings can be measured (using the
prescribed test procedure), and whether
an option is a proprietary technology or
whether it is widely available to all
manufacturers. Table IV.6 shows the
EPCA criteria and additional criteria
used in this screening analysis, and the
design options evaluated using the
screening criteria.
In the NOPR phase, DOE made several
changes to the treatment of design
options from the preliminary analysis
approach. These changes included:
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• Adding a design option to allow for
growth of the unit to increase the size
of the condenser and/or evaporator;
• Adjusting assumptions regarding
maximum compressor EER levels based
on additional research and confidential
input from manufacturers;
• Adjusting potable water
consumption rates for batch type ice
makers subject to a floor that represents
the lowest potable water consumption
rate that would be expected to flush out
dissolved solid reliably;
• Adding a design option to allow
condenser growth in water-cooled
condensers; and
• Adding a drain water heat
exchanger design option.
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list of technologies that can improve the
energy efficiency of automatic
commercial ice makers. The purpose of
the screening analysis is to evaluate the
technologies that improve equipment
efficiency to determine which of these
technologies is suitable for further
consideration in its analyses. To do this,
DOE uses four screening criteria—
design options will be removed from
consideration if they are not
technologically feasible; are not
practicable to manufacture, install, or
service; have adverse impacts on
product utility or product availability;
or have adverse impacts on health or
safety. 10 CFR part 430, subpart C,
appendix A, sections (4)(a)(4) and (5)(b)
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Table IV.7 contains the list of
technologies that remained after the
screening analysis.
TABLE IV.7—TECHNOLOGY OPTIONS FOR AUTOMATIC COMMERCIAL ICE MAKERS THAT WERE SCREENED IN
Technology options
Compressor ..................................................
Condenser ....................................................
Fans and Fan Motors ...................................
Other Motors ................................................
Evaporator ....................................................
Potable Water ...............................................
Batch ice
makers
Continuous
ice makers
Improved compressor efficiency .................
Increased surface area ...............................
Increased air flow ........................................
Increased water flow ...................................
√
√
√
√
√
√
√
√
Higher efficiency condenser fans and fan
motors.
Improved auger motor efficiency .................
Improved pump motor efficiency .................
Larger evaporator surface area ..................
Reduced potable water flow ........................
Drain water thermal exchange ....................
√
√
........................
√
√
√
√
√
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a. Tube Evaporator Design
Among the technologies that DOE
considered were tube evaporators that
use a vertical shell and tube
configuration in which refrigerant
evaporates on the outer surfaces of the
tubes inside the shell, and the freezing
water flows vertically inside the tubes to
create long ice tubes that are cut into
smaller pieces during the harvest
process. Some of the largest automatic
commercial ice makers in the RCU–
NRC–Large–B and the IMH–W–Large–B
equipment classes use this technology.
However, DOE concluded that
implementation of this technology for
smaller capacity ice makers would
significantly impact equipment utility,
due to the greater weight and size of
these designs, and to the altered ice
shape. DOE noted that available tube
icemakers (for capacities around 1,500
lb ice/24 hours and 2,200 lb ice/24
hours) were 150 to 200 percent heavier
than comparable cube ice makers. Based
on the impacts to utility of this
technology, DOE screened out tube
evaporators from consideration in this
analysis.
b. Low Thermal Mass Evaporator Design
DOE’s preliminary analysis did not
consider low thermal mass evaporator
designs. Reducing evaporator thermal
mass of batch type ice makers reduces
the heat that must be removed from the
evaporator after the harvest cycle, and
thus decreases refrigeration system
energy use. DOE indicated during the
preliminary analysis that it was
concerned about the potential
proprietary status of such evaporator
designs, since DOE is aware of only one
manufacturer that produces equipment
with such evaporators. DOE requested
comment on the proprietary status of
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low-thermal-mass evaporator designs in
general, and the design used by the
cited manufacturer (Hoshizaki) in
particular.
Scotsman commented that Hoshizaki
has recently patented or attempted to
patent modifications to improve
evaporator efficiency and noted that
using such evaporator designs would be
difficult for other manufacturers
because it would require an expensive
and risky redesign of entire product
lines. (Scotsman, Public Meeting
Transcript, No. 42 at pp. 35–36;
Scotsman, No. 46 at pp. 2–3) However,
Manitowoc observed that, although
intellectual property is certainly a
concern, there may be ways to
implement this low thermal mass
evaporator technology without exactly
duplicating Hoshizaki’s designs.
(Manitowoc, Public Meeting Transcript,
No. 42 at p. 36)
Hoshizaki commented that its batch
type evaporators do indeed contain
intellectual property in past and future
designs, adding that the tooling costs for
manufacturing these evaporators would
be too expensive for competing
manufacturers to replicate. (Hoshizaki,
No. 53 at p. 2)
AHRI recommended that DOE
eliminate proprietary designs from
consideration and limit its analysis to
technologies that are available to all
manufacturers in the ice maker
industry. (AHRI, No. 49 at p. 4)
Manitowoc commented that, in
addition to the obvious legal issues
associated with favoring a proprietary
design held by a single manufacturer,
DOE’s analysis tools are also incapable
of predicting the potential benefit of low
thermal mass evaporators, which are
difficult to model accurately.
(Manitowoc, Public Meeting Transcript,
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Water-cooled
only.
Air-cooled only.
√
No. 42 at pp. 36–37 and No. 54 at p. 3)
Manitowoc also warned that the impact
of this technology on one ice maker
should not simply be extrapolated to
other machines and that
oversimplification of this analysis
would affect the predicted efficiency
benefits of each technology level.
(Manitowoc, Public Meeting Transcript,
No. 42 at pp. 36–37) Manitowoc added
that customers are very loyal to the style
of ice that they get from its machines
and that all manufacturers keep
customer loyalty in mind when
designing their evaporators.
Consequently, Manitowoc expressed
concern that a new evaporator design
could force manufacturers to change the
style of their ice, which could drive
down sales and result in a low overall
payback despite the improved energy
performance, and therefore Manitowoc
concluded that DOE should not
establish higher efficiency levels based
on this design option. (Manitowoc,
Public Meeting Transcript, No. 42 at pp.
36–37 and No. 54 at p. 3)
On the basis of its proprietary status,
DOE concludes that its initial decision
to screen out low-thermal-mass
evaporator technology was appropriate.
Thus, DOE has screened out this
technology in its NOPR analysis.
c. Drain Water Heat Exchanger
Batch ice makers can benefit from
drain water thermal exchange that cools
the potable water supply entering the
sump, thereby reducing the energy
required to cool down and freeze the
water. Technological feasibility is
demonstrated by one commercially
available drain water thermal heat
exchanger that is currently sold only for
aftermarket installation. This product is
designed to be installed externally to the
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ice maker, and both drain water and
supply water are piped through the
device.30
In the preliminary analysis, DOE
considered whether such a component
could be considered to be part of an ice
maker as defined in EPCA. The EPCA
definition for automatic commercial ice
makers states that the ice maker consists
of a condensing unit and ice-making
section operating as an integral unit,
with means for making and harvesting
ice. (42 U.S.C. 6311(19)) The definition
allows that the ice maker may include
means for storing ice, dispensing ice, or
storing and dispensing ice. None of the
subcomponents of the ice maker listed
in the definition could be interpreted as
referring to heat exchangers for drain
water thermal exchange. DOE notes that
an ice maker can still make ice without
a drain water heat exchanger; hence, the
drain water heat exchanger cannot be
considered an integral part of the
equipment. For these reasons, DOE
concluded during the preliminary
analysis that external drain water heat
exchangers, the only configuration of
this technology for which technological
feasibility is demonstrated, should be
screened out, and requested comments
on this approach.
NPCC asserted that DOE should
consider drain water thermal exchange
as a technology option. NPCC proposed
that reducing the inlet water
temperature could enable an ice maker
to maintain the same capacity without
increasing the overall size of the unit.
Although NPCC does not manufacture
ice makers, it acknowledged having
seen this technology implemented in
other applications, such as water
heating, without reducing capacity or
increasing overall size. (NPCC, Public
Meeting Transcript, No. 42 at pp. 37–38)
Earthjustice commented that DOE’s
rationale for screening out drain water
thermal heat exchangers was defective
on both legal and factual grounds. In the
preliminary analysis TSD, DOE
suggested that externally mounted drain
water heat exchangers would fall
outside EPCA’s definition of automatic
commercial ice makers, and that DOE
therefore had no authority to consider
them in this rulemaking. Earthjustice
argued that this reading twists the
statutory definition’s role in identifying
which products constitute the
‘‘automatic commercial ice makers’’
subject to efficiency standards into a
‘‘Dos and Don’ts’’ list from Congress as
to which elements of ice makers DOE
30 A.J. Antunes and Co. Vizion Product Catalog.
(Last accessed May 18, 2013.)
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may examine when amending the
standards that Congress enacted.
Congress adopted standards that apply
to the ice maker as a whole, and
Earthjustice asserted that there is
therefore no basis to conclude that
EPCA intended to prohibit DOE from
looking holistically at this equipment
when amending the statutory standards.
Earthjustice added that, if every
technological innovation that improved
the efficiency of a covered product
needed to be specifically mentioned in
the statute’s definition of the product,
there would be no need for a screening
analysis. Earthjustice also noted that, in
previous rulemakings, DOE consistently
recognized that components that
improve the efficiency of covered
products merit consideration in the
DOE’s analyses, notwithstanding that
they may be unnecessary to the basic
function performed by the product, not
referred to in the statutory definition
applicable to the product, or external to
the case or envelope of the device.
Finally, Earthjustice commented that
DOE’s assertion that internally mounted
drain heat exchangers would necessarily
increase cabinet size is not true for all
ice maker models. Moreover,
Earthjustice stated, DOE has not
considered options such as
microchannel heat exchangers, which
would increase both machine efficiency
as well as available cabinet space within
the ice maker. (Earthjustice, No. 47 at
pp. 1–4)
DOE has reconsidered its preliminary
suggestion that external drain water heat
exchangers cannot be considered part of
an ice maker simply because they are
not specifically mentioned in the EPCA
definition, now concluding that they
can be considered as a design option
and to be part of a basic model ice
maker, assuming that the drain water
heat exchanger is sold and shipped with
the unit and that the installation and
operating instructions clearly reinforce
this inclusion by detailing the
installation requirements for the heat
exchanger.
Thus, DOE is including this
technology as a design option. As NPCC
noted, externally mounted drain water
heat exchangers would provide energy
savings by using ‘‘waste’’ water to cool
the incoming potable water supply, thus
reducing the amount of energy
necessary to freeze the water into ice.
Whereas internal heat exchangers may
require increased cabinet size to fit
within the ice maker, allowing external
heat exchangers as a design option
would prevent size increase.
DOE has concluded that drain water
heat exchangers, both internally
mounted and externally mounted, are
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design options that can increase the
energy efficiency of automatic
commercial ice makers. The current test
procedures would give manufacturers
credit for efficiency improvement of
drain water heat exchangers, including
externally mounted drain water heat
exchangers as long as they are provided
with the machine and the installation
instructions for the machine indicate
that the heat exchangers are part of the
machine and must be installed as part
of the overall installation.
d. Design Options That Necessitate
Increased Cabinet Size
Some of the design options
considered by DOE in its technology
assessment could require an increased
cabinet size. Examples of such design
options include increasing the surface
area of the evaporator or condenser, or
both. Larger heat exchangers would
enable the refrigerant circuit to operate
with an increased evaporating
temperature and a decreased
condensing temperature, thus reducing
the temperature lift imposed on the
refrigeration system and hence the
compressor power input. In some cases
the added refrigerant charge associated
with increasing heat exchanger size
could also necessitate the installation of
a refrigerant receiver to ensure proper
refrigerant charge management in all
operating conditions for which the unit
is designed, thus increasing the need for
larger cabinet size.
In the preliminary analysis, DOE did
not consider design options that
increase cabinet size, and it requested
comment on this approach. (DOE,
Public Meeting Presentation, No. 29 at
p. 35)
Earthjustice observed that this issue,
in which certain design options
necessitate larger products and therefore
larger installation costs, is common in
rulemakings. Despite the potential
difficulties that increased size could
pose for ice maker manufacturers and
customers, Earthjustice commented that
the preliminary analysis is not
necessarily the stage of the rulemaking
in which such design options should be
ruled out. (Earthjustice, Public Meeting
Transcript, No. 42 at pp. 46–47)
At the February 2012 preliminary
analysis public meeting, Manitowoc
pointed out that the size of ice makers
is severely limited in certain
applications, which would make it
difficult for manufacturers to implement
design changes that reduce energy but
require an increase in size. Manitowoc
warned that DOE should not assume
that all ice maker manufacturers can
increase the sizes of their ice machines
to meet standards. In many cases,
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according to Manitowoc, increasing the
size may result in higher installation
costs, which are not considered in
DOE’s analysis. Manitowoc and AHRI
both noted that a high percentage of the
ice machine business involves replacing
old units and that the size of new ice
makers is therefore dictated by the size
of the products being replaced.
(Manitowoc, Public Meeting Transcript,
No. 42 at pp. 57–59 and No. 54 at p. 2;
AHRI, No. 49 at p. 2) AHRI also
commented that customers continue to
demand smaller ice machines as the
space used to house them competes
against more ‘‘usable’’ spaces, such as
hotel rooms. Hoshizaki agreed that the
industry was moving toward smaller ice
makers and also recommended that DOE
limit cabinet size. Consequently,
Manitowoc, AHRI, and Hoshizaki all
commented that DOE should not
consider design options that increase
cabinet size in its analysis. (Manitowoc,
No. 54 at p. 2; AHRI, No. 49 at p. 2;
Hoshizaki, No. 53 at p. 1)
Scotsman commented that, for
products at the top of the capacity range
within a given standard cabinet size,
manufacturers cannot increase the size
of internal components such as aircooled condensers without increasing
the machines’ cabinet size. This would
make the machines less competitive
because they would no longer
physically fit in certain applications,
according to Scotsman. (Scotsman,
Public Meeting Transcript, No. 42 at pp.
87–88) Moreover, Scotsman noted that
assessing the impact of a technology on
one type of machine and applying it to
other types can be difficult and
inaccurate. For example, while
increasing condenser area could be
simple for a 300-lb machine, it may
require retooling several parts, in
addition to increasing cabinet size and
thus also increasing overall costs, to
make the same condenser growth fit in
a 600-lb machine. (Scotsman, No. 46 at
p. 2) Finally, Scotsman stated that
increasing the size of ice makers will
cause cabinet costs to increase.
(Scotsman, Public Meeting Transcript,
No. 42 at p. 64) Therefore, Scotsman
agreed with its fellow manufacturers
that DOE should avoid design options
requiring cabinet size increases.
(Scotsman, No. 46 at p. 4)
Manitowoc commented that it is rare
for manufacturers to have data regarding
available space, ventilation, or other
variables regarding the final installation
of their products. Moreover, Manitowoc
added that forcing an ice maker with
larger cabinet size into an existing space
that is too small for it would exacerbate
condenser air recirculation, which
decreases its efficiency and reliability.
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(Manitowoc, Public Meeting Transcript,
No. 42 at pp. 62–63)
However, Scotsman also commented
that an ice maker’s energy use typically
decreases as its size increases, meaning
that it may be more efficient to use an
oversized machine than one that has
been downsized. (Scotsman, Public
Meeting Transcript, No. 42 at pp. 61–62)
Howe commented that the physical
size of an automatic commercial ice
maker has no effect on its efficiency or
its run time. According to Howe, the run
time of ice makers is a function of their
productive capacity as well as the size
of their ice storage bins, because ice
production automatically ceases when
the bin is full. Howe added that
regulating the physical size of ice
makers may limit the use of new, more
efficient technologies in the future.
Therefore, Howe urged DOE not to
consider limiting the physical size of ice
makers. (Howe, No. 51 at pp. 1–2)
NEEA/NPCC also urged DOE not to
consider limiting ice maker cabinet size
in the rulemaking. NEEA/NPCC pointed
out that, although improving the
efficiency of an ice maker may require
increasing the size of its components,
many ice makers have sufficient room in
their cabinets to accommodate such size
increases. According to NEEA/NPCC,
advanced evaporator designs could be
used to meet efficiency and capacity
requirements for ice makers whose
evaporators already require the full
cabinet size. (NEEA/NPCC, No. 50 at
p. 2)
CA IOUs agreed that DOE should not
screen out design options that would
require an increase in cabinet size. CA
IOUs referred to a limited field study
whose results indicated to CA IOUs that
larger ice-making equipment may be
accommodated in most situations. CA
IOUs added that there is no evidence as
to whether there may be another space
in installation locations that could
accommodate a larger ice maker.
Therefore, CA IOUs asserted that, in the
absence of a survey or field study that
shows size constraints to be an issue,
DOE should not use size to screen out
design options. (CA IOUs, No. 56 at
p. 3)
Based on these comments from
stakeholders, DOE understands that
automatic commercial ice makers are
often used in applications where space
is very limited. DOE has not received
any data supporting or refuting the
characterization that installation
locations may be able to accommodate
larger icemakers.
Although CA IOUs cited a study
indicating that installation locations
may be able to accommodate larger ice
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makers,31 the sample size of this study
is extremely small and is not necessarily
representative of the entire automatic
commercial ice maker market. The
study does not present any findings on
the size constraints and allowances seen
in the inspected products, and the
pictures themselves are inconclusive.
DOE believes it would be difficult to
support any size-based conclusions
using this study.
Particularly because replacements
comprise such a large portion of the ice
maker industry, ice makers affected by
the proposed standard must maintain
traditional standard widths and depths.
Allowing design options that necessitate
physical size increases may push certain
capacity units beyond their current
standard dimensions and would thus
force the use of lower-capacity
machines in replacement applications,
which would significantly reduce
equipment utility.
On the other hand, screening out sizeincreasing design options would
eliminate from consideration
technologies that could significantly
reduce the energy consumption of
automatic commercial ice makers.
Consideration of design options that
increase the size of ice makers is
strongly related to consideration of sizeconstrained design options. DOE notes
that, while stakeholders have pointed
out that many automatic ice maker
applications are space-constrained, as
described in section IV.B.1.a, DOE does
not have access to sufficiently-detailed
data that would either indicate what
percentage of applications could not
allow size increase, or be the basis to set
size limits for space-constrained classes.
Thus, DOE has also decided not to
create size-constrained equipment
classes.
DOE also notes that there are a wide
range of product sizes within most
equipment classes, and that DOE must
seek out the most-efficient
configurations. DOE noted that the
equipment it purchased for reverse
engineering inspections reflected a
general trend that more-efficient units
were often larger, had larger condensers,
and in some cases had larger
evaporators. Based on DOE’s market
study and equipment inspections, larger
chassis sizes appeared often to be a
means of achieving higher efficiencies.
Thus, DOE is including this packagesize-increasing technologies as design
options in the NOPR analysis. DOE only
31 Karas, A. A Field Study to Characterize Water
And Energy Use of Commercial Ice-Cube Machines
and Quantify Savings Potential. December 2007.
Fisher-Nickel, Inc., San Ramon, CA.
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design option to the condenser package,
and not to the ice-making head that is
placed indoors. In general, DOE only
considered increasing the size of the
evaporator whenever the product
inspections (see section IV.D.4.e)
indicated that it was needed to increase
efficiency.
applied these design options for those
equipment classes where the
representative baseline unit had space
to grow relative to the largest units on
the market. The equipment growth
allowed for larger heat exchangers to
increase equipment efficiency.
For equipment classes with remote
condensers, DOE only applied this
In addition, DOE recognizes that
space constraints are more critical for
SCU units; hence, DOE did not consider
package size growth for SCU equipment
classes.
Table IV.8 indicates for which
analyzed equipment classes DOE
considered chassis growing design
options.
TABLE IV.8—ANALYZED EQUIPMENT CLASSES WHERE DOE ANALYZED SIZE-INCREASING DESIGN OPTIONS
Rated harvest rate
lb ice/24 hours
Unit
Used design options that increased size?
IMH–A–Small–B ............................................................
IMH–A–Large–B (med) ..................................................
IMH–A–Large–B (large) .................................................
IMH–W–Small–B ...........................................................
IMH–W–Med–B .............................................................
IMH–W–Large–B ...........................................................
RCU–XXX–Large–B (med) ............................................
300
800
1,500
300
850
2,600
1,500
RCU–XXX–Large–B (large) ...........................................
2,400
SCU–A–Small–B ...........................................................
SCU–A–Large–B ...........................................................
SCU–W–Large–B ..........................................................
IMH–A–Small–C ............................................................
IMH–A–Large–C (med) .................................................
SCU–A–Small–C ...........................................................
110
200
300
310
820
110
Table IV.9 shows the size increases
that DOE considered in the analysis.
DOE only considered these size
Yes.
Yes.
No.
Yes.
No.
No.
For the remote condenser, but not for the ice-making
head.
For the remote condenser, but not for the ice-making
head.
No.
No.
No.
No.
No.
No.
increases when a unit existed on the
market that was larger than the baseline
unit. DOE based the new chassis sizes
on the sizes of current units on the
market.
TABLE IV.9—DESCRIPTION OF SIZE INCREASE DESIGN OPTIONS IN THE ENGINEERING ANALYSIS
Equipment class
Equipment type
Size descriptor
IMH–A–Small–B ......
IMH ...................
IMH–A–Large–B
(Med).
IMH–W–Small–B .....
IMH ...................
Baseline ..................
Growth .....................
Baseline ..................
Growth .....................
Baseline ..................
Growth .....................
IMH ...................
Further information on this analysis is
available in chapter 5 of the NOPR TSD.
e. Microchannel Heat Exchangers
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Height
inches
NEEA/NPCC, ASAP, and Earthjustice
all recommended that DOE include
microchannel heat exchanger
technology in its examination of design
options for improving condenser and
evaporator efficiency. NEEA/NPCC
noted that this technology has been
used in heat exchangers for air handling
equipment for years and it would allow
for increased efficiency or greater ice
production capacity. (NEEA/NPCC, No.
50 at p. 2) ASAP commented that,
although it is not aware of ice makers on
the market that incorporate
microchannel heat exchangers, ice
maker manufacturers who have tested
prototype units that implement this
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Width
inches
16.5
21.5
26
29
20
23.5
technology have noticed significant
efficiency improvements. (ASAP, No. 52
at p. 1) Finally, Earthjustice noted that
microchannel heat exchanger
technology would increase both
machine efficiency and available
cabinet space within the ice maker.
(Earthjustice, No. 47 at pp. 1–4)
DOE has not found evidence that this
technology is cost-effective. Moreover,
through discussions with
manufacturers, DOE has learned of no
instances of energy savings associated
with the use of microchannel heat
exchangers in ice makers.
Manufacturers also noted that the
reduced refrigerant charge associated
with microchannel heat exchangers can
be detrimental to the harvest
performance of batch type ice makers, as
there is not enough charge to transfer
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Depth
inches
30
30
30
30
30
30
Volume
cubic feet
24.5
24.5
24
24
24
23.5
7.02
9.14
10.83
12.08
8.33
9.59
heat to the evaporator from the
condenser.
DOE contacted microchannel
manufacturers to determine whether
there were savings associated with use
of microchannel heat exchangers in
automatic commercial ice makers. These
microchannel manufacturers noted that
investigation of microchannel was
driven by space constraints rather than
efficiency.
Because the potential for energy
savings is inconclusive, based on DOE
analysis as well as feedback from
manufacturers and heat exchanger
suppliers, and based on the potential
utility considerations associated with
compromised harvest performance in
batch type ice makers associated with
this heat exchanger technology’s
reduced refrigerant charge, DOE
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screened out microchannel heat
exchangers as a design option in this
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f. Smart Technologies
CA IOUs recommended that DOE also
consider including ‘‘smart’’ technologies
as design options that will go beyond
simple energy savings by capturing
demand reductions as well. To support
this proposition, CA IOUs referenced a
study showing that, for automatic
commercial ice-making equipment,
there are 450 megawatts of demand
reduction potential in California alone,
indicating a significant nationwide
possibility for reducing the energy
demand associated with ice makers. If
DOE does not include ‘‘smart’’
technologies as design options, CA IOUs
instead asked that DOE comment on
whether states will be allowed to
implement such design option
requirements for ice-making equipment.
(CA IOUs, No. 56 at pp. 5–6)
While there may be energy demand
benefits associated with use of ‘‘smart
technologies’’ in ice makers in that they
reduce energy demand (e.g., shift the
refrigeration system operation to a time
of utility lower demand), DOE is not
aware of any commercialized products
or prototypes that also demonstrate
improved energy efficiency in automatic
commercial ice makers. Demand savings
alone do not impact energy efficiency,
and DOE cannot consider technologies
that do not offer energy savings as
measured by the test procedure. Since
the scope of this rulemaking is to
consider energy conservation standards
that increase the energy efficiency of
automatic commercial ice makers, not
how they operate, for example, in
relation to utility demand, this
technology option has been screened
out because it does not save energy as
measured by the test procedure.
g. Screening Analysis: General
Comments
Howe suggested that DOE gather
information on a wider variety of design
types of both batch and continuous type
ice makers before completing its
analyses, noting that DOE may have
prematurely screened out design
options simply because they had
adverse effects on the ice makers within
the small range of design parameters for
which DOE collected data. (Howe, No.
51 at p. 4)
Howe has not provided specific
examples of technologies that it has
claimed that DOE prematurely screened
out, so DOE is not in a position to
respond. During the NOPR analysis,
DOE analyzed additional units and
accounted for this additional data in its
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engineering analysis. DOE considered a
wide range of design types for ice
makers, and screened out technologies
as described in section IV.D.
D. Engineering Analysis
The engineering analysis determines
the manufacturing costs of achieving
increased efficiency or decreased energy
consumption. DOE historically has used
the following three methodologies to
generate the manufacturing costs
needed for its engineering analyses: (1)
The design-option approach, which
provides the incremental costs of adding
to a baseline model design options that
will improve its efficiency; (2) the
efficiency level approach, which
provides the relative costs of achieving
increases in energy efficiency levels,
without regard to the particular design
options used to achieve such increases;
and (3) the cost-assessment (or reverse
engineering) approach, which provides
‘‘bottom-up’’ manufacturing cost
assessments for achieving various levels
of increased efficiency, based on
detailed data as to costs for parts and
material, labor, shipping/packaging, and
investment for models that operate at
particular efficiency levels.
As discussed in the Framework
document and preliminary analysis,
DOE conducted the engineering
analyses for this rulemaking using a
combined efficiency level/design
option/reverse engineering approach to
developing cost-efficiency curves for
automatic commercial ice makers. DOE
established efficiency levels defined as
percent energy use lower than that of
baseline efficiency products. DOE’s
analysis is based on the efficiency
improvements associated with groups of
design options. Also, DOE developed
manufacturing cost models based on
reverse engineering of products to
develop a baseline manufacturer
production cost (MPC) and to support
calculation of the incremental costs
associated with improvement of
efficiency.
DOE selected a set of 25 equipment
classes to analyze directly in the
engineering analysis. To develop the
analytically derived cost-efficiency
curves, DOE collected information from
various sources on the manufacturing
cost and energy use reduction
characteristics of each of the design
options. DOE reviewed product
literature, tested and conducted reverse
engineering of 39 ice makers, and
interviewed component vendors of
compressors and fan motors. DOE also
conducted interviews with
manufacturers during the preliminary
analysis. Additional details of the
engineering analysis are available in
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chapter 5 of the NOPR TSD and a copy
of the engineering questionnaire is
reproduced in appendix 12A of the
NOPR TSD.
Cost information from the vendor
interviews and discussions with
manufacturers provided input to the
manufacturing cost model. DOE
determined incremental costs associated
with specific design options from both
vendor information and the cost model.
DOE modeled energy use reduction
using the FREEZE program, which was
developed in the 1990s and upgraded as
part of the preliminary analysis. The
reverse engineering, vendor interviews,
and manufacturer interviews provided
input for the energy analysis. The final
incremental cost estimates and the
energy modeling results together
constitute the energy efficiency curves
presented in the NOPR TSD chapter 5.
DOE also considered conducting the
engineering analysis using an efficiency
level approach based on rated and/or
measured energy use and manufacturing
cost estimates based on reverse
engineering data. DOE completed
efficiency level analyses for several
equipment classes but concluded that
this approach was not viable, because
the analysis suggested that cost would
be reduced for higher efficiency designs
for several of the equipment classes.
This analysis is discussed in section
IV.D.4.e and in chapter 5 of the NOPR
TSD.
1. Representative Equipment for
Analysis
In performing its engineering analysis,
DOE selected representative units for 12
equipment class to serve as analysis
points in the development of costefficiency curves. In selecting these
units, DOE selected models that were
generally representative of the typical
offerings produced within the given
equipment class. DOE sought to select
models having features and technologies
typically found in the minimum
efficiency equipment currently available
on the market, but selected some models
having features and technologies
typically found in the highest efficiency
equipment currently available on the
market.
2. Efficiency Levels
a. Baseline Efficiency Levels
EPCA, as amended by the EPACT
2005, prescribed the following
standards for batch type ice makers,
shown in Table IV.10, effective January
1, 2010. (42 U.S.C. 6313(d)(1)) For the
engineering analysis, DOE used the
existing batch type equipment standards
as the baseline efficiency level for the
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equipment types under consideration in
this rulemaking. Also, DOE applied the
standards for equipment with harvest
capacities up to 2,500 lb ice/24 hours as
baseline efficiency levels for the larger
batch type equipment with harvest
capacities between 2,500 and 4,000 lb
ice/24 hours, which are currently not
regulated. DOE applied two exceptions
to this approach, as discussed below.
For the IMH–W–Small–B equipment
class, DOE slightly adjusted the baseline
energy use level to close a gap between
the IMH–W–Small–B and the IMH–W–
Medium–B equipment classes. For
equipment in the IMH–A–Large–B
equipment class with harvest capacity
above 2,500 lb ice per 24 hours, DOE
chose a baseline efficiency level equal to
the current standard level at the 2,500
lb ice per 24 hours capacity. In its
analysis, DOE is treating the constant
portion of the IMH–A–Large–B
equipment class as a separate
equipment class, IMH–A–Extended–B.
Section IV.C contains more details of
these adjustments.
DOE is not proposing adjustment of
maximum condenser water use
standards for batch type ice makers.
First, DOE’s authority does not extend
to regulation of water use, except as
explicitly provided by EPCA. Second,
DOE determined that increasing
condenser water use standards to allow
for more water flow in order to reduce
energy use is not cost-effective. The
details of this analysis are available in
chapter 5 of the NOPR TSD.
14875
For water-cooled batch equipment
with harvest capacity less than 2,500 lb
ice per 24 hours, the baseline condenser
water use is equal to the current
condenser water use standards for this
equipment.
For water-cooled equipment with
harvest capacity greater than 2,500 lb
ice per 24 hours, DOE proposes to set
maximum condenser water standards
equal to the current standard level for
the same type of equipment with a
harvest capacity of 2,500 lb ice per 24
hours—the proposed standard level
would not continue to drop as harvest
capacity increases, as it does for
equipment with harvest capacity less
than 2,500 lb ice per 24 hours.
TABLE IV.10—BASELINE EFFICIENCY LEVELS FOR BATCH ICE MAKERS
Equipment type
Type of
cooling
Rated harvest rate
lb ice/24 hours
Maximum energy use
kWh/100 lb ice
Maximum condenser
water use *
gal/100 lb ice
Ice-Making Head ................
Water .......
<500 ..................................
≥500 and <1,436 ..............
≥1,436 ...............................
<450 ..................................
≥450 and <2,500 ..............
≥2,500 ...............................
<1,000 ...............................
≥1,000 ...............................
<934 ..................................
≥934 ..................................
<200 ..................................
≥200 ..................................
7.79–0.0055H ** † .......................................
5.58–0.0011H .............................................
4.0 ...............................................................
10.26–0.0086H ...........................................
6.89–0.0011H .............................................
4.1 ...............................................................
8.85–0.0038H .............................................
5.10 .............................................................
8.85–0.0038H .............................................
5.30 .............................................................
11.4–0.019H ...............................................
7.60 .............................................................
<175 ..................................
≥175 ..................................
18.0–0.0469H .............................................
9.80 .............................................................
200–0.022H.
200–0.022H.
145.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable.
191–0.0.
For <2,500: 191–0.0315H
For ≥2,500: 112.
Not Applicable.
Not Applicable.
Air ............
Remote Condensing (but
not remote compressor).
Remote Condensing and
Remote Compressor.
Self-Contained ....................
Air ............
Air ............
Water .......
Air ............
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* Water use is for the condenser only and does not include potable water used to make ice.
** H = rated harvest rate in pounds per 24 hours, indicating the water or energy use for a given rated harvest rate. Source: 42 U.S.C. 6313(d).
† There is a gap between the existing IMH–W–Small–B standard and the IMH–W–Medium–B standard. The baseline equation for the IMH–W–
Small–B equipment class was adjusted from 7.8—0.0055*H to 7.79—0.0055*H to close this gap.
Currently there are no DOE energy
standards for continuous type ice
makers. During the preliminary
analysis, DOE developed baseline
efficiency levels using energy use data
available from several sources, as
discussed in chapter 3 of the
preliminary TSD. DOE chose baseline
efficiency levels that would be met by
nearly all ice makers represented in the
databases. Also, because energy use
reported at the time DOE was preparing
the preliminary analysis did not include
the hardness adjustment prescribed by
the new test procedure,32 DOE made
these adjustments to the data. At that
time, hardness data was also not
generally available for ice makers;
therefore, DOE used assumptions of 0.7
32 Ice hardness is a term used for ice produced by
continuous type ice makers, describing what
percentage of the output is hard ice (as compared
to water).
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ice hardness for flake ice makers and
0.85 for nugget ice makers to make the
hardness adjustments, thus estimating
energy use as it would be measured by
the new test procedure. 77 FR 3404 (Jan.
24, 2012). DOE selected harvest capacity
break points (harvest capacities at
which the slopes of the trial baseline
efficiency levels change) for all but the
self-contained equipment classes
consistent with those selected by the
Consortium for Energy Efficiency (CEE)
for their new Tier 2 efficiency level for
flake ice makers. Note that DOE did not
also adopt the CEE energy use levels for
any of its incremental efficiency levels
because the CEE energy use levels do
not incorporate adjustment of the
measured energy use based on ice
hardness.
For the NOPR analysis, DOE used
newly available information published
in the AHRI Directory of Certified
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Product Performance, the California
Energy Commission, the ENERGY STAR
program, and vendor Web sites, to
update its icemaker ratings database
(‘‘DOE icemaker ratings database’’). In
2012, AHRI published equipment
ratings for many continuous type ice
makers, including ice hardness factors
calculated as prescribed by ASHRAE
29–2009, which is incorporated by
reference in the new DOE test
procedure. DOE recreated its database
for continuous type ice makers based on
the available AHRI data, considering
only the ice makers for which AHRI
ratings for ice hardness were available.
DOE also adjusted the harvest capacity
break points for the continuous
equipment classes based on the new
data.
The baseline efficiency levels for
continuous type ice makers are
presented in Table IV.11. They are
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compared with the ice maker energy use
data in chapter 3 of the NOPR TSD. For
the remote condensing equipment, the
large-capacity remote compressor and
large-capacity non-remote compressor
classes have been separated and are
different by 0.2 kWh/100 lb, identical to
the batch equipment differential. This
differential is also discussed briefly in
section IV.B.1.e. DOE requests
comments on the development of
efficiency levels for continuous type ice
makers and whether the selected levels
appropriately represent baseline
equipment.
TABLE IV.11—BASELINE EFFICIENCY LEVELS FOR CONTINUOUS ICE MAKER EQUIPMENT CLASSES
Rated
harvest rate
lb ice/24 hours
Equipment type
Type of
cooling
Ice-Making Head .............................
Water .......
Air ............
Remote Condensing (Remote Compressor).
Remote Condensing (Non-remote
Compressor).
Self-Contained .................................
Air ............
Air ............
Water .......
Air ............
Small (<900)
Large (≥900)
Small (<700)
Large (≥700)
Small (<850)
Large (≥850)
Small (<850)
Large (≥850)
Small (<900)
Large (≥900)
Small (<700)
Large (≥700)
......
......
......
......
......
......
......
......
......
......
......
......
Maximum energy use
kWh/100 lb ice *
Maximum condenser water use *
gal/100 lb ice
8.1–0.00333H .................................
5.1 ...................................................
11.0–0.00629H ...............................
6.6 ...................................................
10.2–0.00459H ...............................
6.3 ...................................................
10.0–0.00459H ...............................
6.1 ...................................................
9.1–0.00333H .................................
6.1 ...................................................
11.5–0.00629H ...............................
7.1 ...................................................
160–0.0176H.
≤2,500: 160–0.0176H; >2,500: 116.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable.
153–0.0252H.
≤2,500: 153–0.0252H; >2,500: 90.
Not Applicable.
Not Applicable.
* H = rated harvest rate in lb ice/24 hours.
b. Incremental Efficiency Levels
For each of the nine analyzed batch
type ice-making equipment classes, DOE
established a series of incremental
efficiency levels for which it has
developed incremental cost data and
quantified the cost-efficiency
relationship. DOE chose a set of
analyzed equipment classes that would
be representative of all batch type ice-
making equipment classes, and grouped
non-analyzed equipment classes with
analyzed equipment classes accordingly
in the downstream analysis. Table IV.12
shows the selected incremental
efficiency levels.
For the IMH–A–Large–B equipment
class, DOE is adopting its suggested
approach from the preliminary analysis
meeting. (DOE, Preliminary Analysis
Public Meeting Presentation, No. 42 at
p. 29) As part of this approach, DOE is
treating the largest units as an extended
equipment class (IMH–A–Extended–B),
basing the analysis for this equipment
class on the analysis for a 1,500 lb ice/
24 hour IMH–A–Large–B unit. When
setting TSLs, DOE is considering the
800 lb ice/24 hour IMH–A–Large–B
analysis separately from the 1,500 lb
ice/24 hour analysis.
TABLE IV.12—INCREMENTAL EFFICIENCY LEVELS FOR BATCH ICE MAKER EQUIPMENT CLASSES
Equipment type *
Rated harvest rate
lb ice/24 hours
EL 2 **
IMH–W–Small–B ...............................
IMH–W–Med–B .................................
IMH–W–Large–B ...............................
IMH–A–Small–B ................................
IMH–A–Large–B ‡ ..............................
RCU–NRC–Small–B *** .....................
RCU–NRC–Large–B .........................
RCU–RC–B .......................................
<500 ..................................................
≥500 and <1,436 ...............................
≥1,436 ...............................................
<450 ..................................................
≥450 ..................................................
<1,000 ...............................................
≥1,000 ...............................................
<934 ..................................................
≥934 ..................................................
<200 ..................................................
≥200 ..................................................
<175 ..................................................
≥175 ..................................................
10% ..................
10% ..................
10% ..................
10% (E–STAR †)
10% (E–STAR †)
9% (E–STAR †)
9% (E–STAR †)
9% (E–STAR †)
9% (E–STAR †)
7% ....................
7% ....................
7% (E–STAR †)
7% (E–STAR †)
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SCU–W–Small–B *** .........................
SCU–W–Large–B ..............................
SCU–A–Small–B ...............................
SCU–A–Large–B ...............................
EL 3
(%)
EL 4
(%)
15
15
15
15
15
15
15
15
15
15
15
15
15
EL 5
(%)
20
20
20
20
20
20
20
20
20
20
20
20
20
EL 6
(%)
25
................
................
25
25
................
................
................
................
25
25
25
25
................
................
................
30
................
................
................
................
................
30
30
30
30
* See Table III.1 for a description of these abbreviations.
** EL = efficiency level; EL 1 is the baseline efficiency level, while EL 2 through EL 6 represent increased efficiency levels.
*** These equipment classes were not directly analyzed.
† New ENERGY STAR levels became effective on February 1, 2013. These levels represent the ENERGY STAR levels prior to February 1,
2013.
‡ The IMH–A–Large–B levels were analyzed at the 800 lb ice/24 hour size and the 1,500 lb ice/24 hour size, and the 1,500 lb ice/24 hour size
were used to set standards for the new IMH–A–Extended–B class.
For each of the three analyzed
continuous type ice maker equipment
classes, DOE established a series of
incremental efficiency levels, for which
it has developed incremental cost data
and quantified the cost-efficiency
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relationship. DOE chose a set of
analyzed equipment classes that would
be representative of all continuous type
ice-making equipment classes, and
grouped non-analyzed equipment
classes with analyzed equipment classes
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accordingly in the downstream analysis,
as discussed in section V.A.1. Table
IV.13 shows the selected incremental
efficiency levels. The efficiency levels
are defined by the percent energy use
less than the baseline energy use.
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TABLE IV.13—SELECTED INCREMENTAL EFFICIENCY LEVELS FOR CONTINUOUS TYPE ICE MAKER EQUIPMENT CLASSES
Rated harvest
rate
lb ice/24 hours
Equipment type *
IMH–W–Small–C ......................................
IMH–W–Large–C .....................................
IMH–A–Small–C .......................................
IMH–A–Large–C ......................................
<900
≥900
<700
≥700
RCU–Small–C ..........................................
RCU–Large–C ..........................................
SCU–W–Small–C .....................................
SCU–W–Large–C ....................................
EL 4
(%)
EL 5
(%)
EL 6
(%)
........................
........................
10
10
........................
........................
15
15
........................
........................
20
20
........................
........................
25
25
........................
........................
30
30
<700
SCU–A–Large–C .....................................
EL 3
(%)
<850
≥850
<900
≥900
SCU–A–Small–C ......................................
EL 2 **
(%)
≥700
Not Analyzed.
Not Analyzed.
Not Analyzed.
No existing products on the market.
7
15
20
25
........................
No existing products on the market.
* See Table III.1 for a description of these abbreviations.
** EL 1 is the baseline efficiency level, while EL 2 through EL 6 represent increased efficiency levels.
DOE selected the efficiency levels for
the continuous type ice makers based on
the levels proposed in the preliminary
analysis.
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c. IMH–A–Large–B Treatment
The current DOE energy conservation
standard for large air-cooled IMH cube
type ice makers is represented by an
equation for which maximum allowable
energy usage decreases linearly as
harvest rate increases from 450 to 2,500
lb ice/24 hours. Extending the current
IMH–A–Large–B equation to the 4,000
lb ice/24 hours range would result in
efficiency levels in the newly covered
range (between 2,500 lb/day and 4,000
lb/day) that may not be technically
feasible. For example, at 4,000 lb ice/24
hours, the specified baseline energy use
would be 2.49 kWh/100 lb, a value far
below the energy consumption of
existing IMH–A–Large–B ice makers
(e.g., it is 39 percent lower than the
lowest rating for IMH–A–Large–B
equipment of which DOE is aware, 4.1
kWh/100 lb). In the preliminary
analysis, DOE proposed establishing
baseline and incremental efficiency
levels for this equipment class that
maintain a constant level of energy use
at higher harvest capacities, with
exceptions in certain harvest capacity
ranges to avoid backsliding. For
example, for efficiency level 2, DOE
proposed that (a) between 1,600 and
2,080 lb ice/24 hours, the maximum
energy use would be independent of
harvest capacity, as is the case for all
other high-harvest-capacity equipment
classes, (b) between 2,080 lb ice/24
hours, the maximum energy usage
would be calculated according to the
current standard to avoid EPCA antibacksliding provisions, and (c) between
2,500 and 4,000 lb ice/24 hours, the
maximum energy use would remain
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constant. DOE presented this approach
in the preliminary analysis and
requested comment on it; DOE did not
receive any comments on this approach.
Hence, DOE is proposing to use the
approach it outlined in the preliminary
analysis meeting for the IMH–A–Large–
B equipment class (DOE, Preliminary
Analysis Public Meeting Presentation,
No. at p. 29). Further, DOE proposes to
separate capacity ranges of this class
into ranges designated IMH–A–B and
IMH–A–Extended–B, the first for
equipment with harvest capacity less
than 1,500 lb ice/24 hours and the
second with greater harvest capacity.
The proposed IMH–A–B efficiency
levels would be constant between 800
and 1,500 lb ice/24 hours. Each
proposed IMH–A–Extended–B
efficiency level would start at an energy
use that is equal to that of one of IMH–
A–B efficiency levels. Its energy use
would remain constant at this level
within its lower range of harvest
capacity rates, but would follow the
current DOE standard between the
harvest capacity for which the constant
level equals the current DOE standard
and 2,500 lb ice/24 hours. Beyond 2,500
lb ice/24 hours, it would remain
constant from 2,500 to 4,000 lb ice/24
hours.
The technologies that are used in some
maximum available equipment that
were screened out include low thermalmass evaporators and tube evaporators
for batch type ice makers.
Efficiency levels for maximum
available equipment in the batch type
ice-making equipment classes are
tabulated in Table V.16. This
information is based on DOE’s icemaker
ratings database (also see data in chapter
3 of the NOPR TSD). The efficiency
levels are represented as an energy use
percentage reduction compared to the
energy use of baseline-efficiency
equipment, the selection of which is
discussed in section IV.D.2.a.
TABLE IV.14—EFFICIENCY LEVELS FOR
MAXIMUM AVAILABLE EQUIPMENT IN
BATCH ICE MAKER EQUIPMENT
CLASSES
Equipment class
Energy use lower than
baseline
IMH–W–Small–B
IMH–W–Med–B ...
IMH–W–Large–B
24.5%.
22.4%.
7.5% (at 1,500 lb ice/24
hours).
8.3% (at 2,600 lb ice/24
hours).
23.6%.
20.7% (at 800 lb ice/24
hours).
21.3% (at 1,500 lb ice/24
hours).
24.6%.
40.2% (at 1,500 lb ice/24
hours).
26.7% (at 2,400 lb ice/24
hours).
22.5%.
27.6%.
35.8%.
29.6%.*
IMH–A–Small–B ..
IMH–A–Large–B ..
d. Maximum Available Efficiency
Equipment
For the NOPR analysis, DOE
considered the most-efficient equipment
available on the market, known as
maximum available equipment. In some
cases, the maximum available
equipment uses technology options that
DOE chose to screen out for its analysis.
Hence, DOE also identified maximum
available equipment without screened
technologies (see the discussion of the
engineering analysis in section IV.D.2.f).
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RCU–Small–B .....
RCU–Large–B .....
SCU–W–Small–B
SCU–W–Large–B
SCU–A–Small–B
SCU–A–Large–B
* This is the second highest rated product;
the highest rated product is also a dispenser
unit.
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options. Evaluation of maximum
technological feasibility was again based
on energy modeling, but DOE compared
energy modeling results with maximum
available without screened technologies
to ensure consistency of results with
actual designs at that level. See chapter
5 of the NOPR TSD for the results of the
analyses, and a list of technologies
included in max-tech equipment.
The max-tech efficiency levels
represent equipment combining all of
the design options. However, they are
not generally attained by existing
equipment—this is largely due to the
consideration of design options seldom
TABLE IV.15—EFFICIENCY LEVELS FOR used in commercially available
MAXIMUM AVAILABLE EQUIPMENT equipment because they are not
FOR CONTINUOUS TYPE ICE MAKER considered to be cost-effective by
manufacturers, such as brushless DC
EQUIPMENT CLASSES
motors and drain water heat exchangers.
Energy use lower than
DOE does not screen out design options
Equipment class
baseline
based on cost-effectiveness.
Table III.2 and Table III.3 show the
IMH–W–Small–C
16.5%.
IMH–W–Large–C
12.2% (at 1,000 lb ice/24 max-tech levels determined in the
hours).
engineering analysis for batch and
8.6% (at 1,800 lb ice/24
continuous type automatic commercial
hours).
ice makers, respectively.
IMH–A–Small–C .. 25.3%.
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
Efficiency levels for maximum
available equipment in the continuous
type ice-making equipment classes are
tabulated in Table IV.15. This
information is based on a survey of
product databases and manufacturer
Web sites (also see data in chapter 3 of
the TSD). The efficiency levels are
represented as an energy use percentage
reduction compared to the energy use of
baseline-efficiency equipment, the
selection for which is discussed in
section IV.D.2.a. DOE used the
maximum available efficiency levels to
calibrate its engineering analysis against
current equipment.
TABLE IV.17—MAX-TECH LEVELS FOR
CONTINUOUS AUTOMATIC COMMERCIAL ICE MAKERS
Equipment type
IMH–W–Small–C
IMH–W–Large–C
IMH–A–Small–C ..
IMH–A–Large–C
RCU–Small–C .....
RCU–Large–C .....
SCU–W–Small–C
SCU–W–Large–
C.*
SCU–A–Small–C
SCU–A–Large–
C.*
Energy use lower than
baseline
Not analyzed.
Not analyzed.
25.3%.
17% (at 820 lb ice/24
hours).
Not analyzed.
Not analyzed.
Not analyzed.
No units available.
24%.
No units available.
* DOE’s investigation of equipment on the
market revealed that there are no existing
products in either of these two equipment
classes (as defined in this NOPR).
f. Comment Discussion
Impact of the Variability of Ice Hardness
Measurements on Efficiency Levels for
Continuous Type Ice Maker Equipment
Manitowoc noted that there are no
industry standards for the calorimetric
values of different types of ice and
IMH–A–Large–C
8.1% (at 820 lb ice/24
TABLE IV.16—MAX-TECH LEVELS FOR cautioned that DOE’s assumptions for
hours).
17.0% (at 1,500 lb ice/24
BATCH AUTOMATIC COMMERCIAL ICE these calorimetric values may invalidate
its analysis of manufacturer-supplied
hours).
MAKERS
data. (Manitowoc, Public Meeting
RCU–Small–C ..... 18.4%.
RCU–Large–C ..... 18.5%.
Transcript, No. 42 at pp. 51–52)
Energy use lower than
SCU–W–Small–C 18.7%.*
Equipment type *
Hoshizaki recommended that ice
baseline
SCU–W–Large–C No equipment on the
hardness have one standard that
market.*
incorporates all continuous type ice
IMH–W–Small–B
30%.
SCU–A–Small–C
24.4%.
maker data and added that DOE should
IMH–W–Med–B ... 22%.
SCU–A–Large–C
No equipment on the
readdress the baseline for continuous
IMH–W–Large–B
17% (at 1,500 lb ice/24
market.*
hours).
type ice-making equipment after taking
* DOE’s inspection of currently available
16% (at 2,600 lb ice/24
AHRI’s 2012 ice hardness verification
equipment revealed that there are no available
hours).
testing into account. (Hoshizaki, No. 53
products in the defined SCU–W–Large–C and IMH–A–Small–B .. 33%.
at p. 1)
SCU–A–Large–C equipment classes at this
IMH–A–Large–B .. 33% (at 800 lb ice/24
Howe recommended that DOE
time.
hours).
supplement its data on continuous type
e. Maximum Technologically Feasible
21% (at 1,500 lb ice/24
ice makers by including results from
hours).
Efficiency Levels
tests using the current test procedure,
RCU–Small–B ..... Not analyzed.
When DOE proposes to adopt (or not
adding that information on continuous
RCU–Large–B ..... 21% (at 1,500 lb ice/24
adopt) an amended or new energy
type ice makers has changed drastically
hours).
conservation standard for a type or class
as of late. (Howe, No. 51 at p. 2)
21% (at 2,400 lb ice/24
of covered equipment such as automatic
DOE notes that some of these
hours).
commercial ice makers, it determines
comments were made before AHRI had
SCU–W–Small–B Not analyzed.
the maximum improvement in energy
completed verification testing work that
SCU–W–Large–B 35%.
efficiency that is technologically
is mentioned by Hoshizaki. DOE
SCU–A–Small–B
41%.
feasible for such equipment. (See 42
updated its database over the course of
SCU–A–Large–B
36%.
U.S.C. 6295(p)(1) and 6313(d)(4))
2012, as many of the continuous type
* IMH is ice-making head; RCU is remote ice maker data in AHRI’s database were
Accordingly, in the preliminary
SCU is self-contained unit;
analysis, DOE determined the maximum condensing unit; A is air-cooled; Small refers W updated, and hardness data was
is water-cooled;
to
technologically feasible (‘‘max-tech’’)
the lowest harvest category; Med refers to the provided. DOE has primarily used this
improvements in energy efficiency for
Medium category (water-cooled IMH only); data, supplemented by DOE test data
automatic commercial ice makers in the Large refers to the large size category; RCU (including hardness test data) to
units were modeled as one with line losses
engineering analysis using energy
evaluate the energy consumption
used to distinguish standards.
modeling and the design options that
characteristics of continuous type icepassed the screening analysis. As part of
making equipment and to set efficiency
the NOPR analysis, DOE modified its
levels.
DOE notes that, consistent with
energy use analysis. In addition, DOE
Hoshizaki’s suggestion, the proposed
considered a different range of design
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standards for continuous type ice
makers use one metric that combines ice
quality and energy usage. In addition,
DOE has not proposed use of the
Canadian efficiency levels for
continuous type ice makers. The
proposed efficiency levels for
continuous type ice makers are
discussed in sections IV.D.2.a and
IV.D.2.b.
Correlation of Efficiency Levels With
Design Options
Manitowoc expressed confusion over
the relationship between the efficiency
levels and the technology options that
go into those efficiency levels.
Therefore, Manitowoc requested that
DOE provide additional information to
explain which technology options were
associated with each efficiency level.
(Manitowoc, Public Meeting Transcript,
No. 42 at p. 51)
Manitowoc pointed out that one of the
SCU-air-cooled models used for the
max-available efficiency level is actually
a combined ice machine and hotel
dispenser, and as such is not a
representative example of the SCU
category, which generally consists of
undercounter designs. Manitowoc
further stated that its larger size would
allow the model to achieve higher
efficiencies than would normally be
possible for the majority of SCU aircooled models. Therefore, Manitowoc
commented, this model should not be
used to justify the max-available
efficiency attainable for this category of
ice makers. (Manitowoc, No. 54 at pp.
2–3)
In response to Manitowoc’s comment
regarding the relationship of design
options and efficiency levels, DOE
provided additional information in the
automatic commercial ice maker docket,
as a supporting and related material
document 33 (DOE, Preliminary Analysis
Presentation Supplementary
Engineering Data, No. 43). The data in
this document reflects the preliminary
engineering analysis. For the NOPR
analysis, the relationship between
design options and efficiency levels has
changed due to changes made to the
design options considered, assumptions,
and analysis approach. The new
information is detailed in sections
IV.D.4.a (cost model adjustments) and
IV.D.4.f (energy model adjustments) and
in the NOPR TSD chapter 5.
DOE notes that Manitowoc is correct
in its observation that one of the max33 See www.regulations.gov/#!documentDetail;D=
EERE-2010-BT-STD-0037-0043. After the February
2012 preliminary analysis public meeting, DOE
published cost-efficiency curves showing the
relationship of efficiency levels to design options
for each directly analyzed equipment class.
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available SCU models from the
preliminary analysis is not
representative of the undercounter units
that make up the majority of the SCU
category. DOE had intended to avoid
inclusion of oversize SCU models that
are not suitable for undercounter design
in its establishment of maximum
technology for SCU equipment classes.
DOE has reviewed the maximum
technology designations and has
removed all ice maker-dispenser
combinations from consideration in its
analysis.
RCU Class Efficiency Level Differential
In its preliminary engineering
analysis, DOE concluded that the 0.2
kWh per 100 lb ice differential in
maximum allowable energy use for
large-sized batch RCU ice makers with
remote compressors as compared with
those with compressors in the icemaking heads is appropriate, both for
batch and continuous type ice makers.
(DOE, Preliminary Analysis Public
Meeting Presentation, No. 29 at p. 30)
DOE requested comment on this
conclusion.
Manitowoc confirmed that the 0.2
kWh per 100 lb of ice difference in
energy use between these two classes of
RCUs seemed valid and that it was
reasonable to continue using this value
while developing the new standards.
(Manitowoc, Public Meeting Transcript,
No. 42 at p. 44 and No. 54 at p. 3) CA
IOUs stated that its analysis of product
data indicates that RCUs with and
without dedicated remote compressors
do not consume significantly different
levels of energy. CA IOUs thus
suggested that DOE continue to look at
product performance data and customer
utility in order to determine whether
separate equipment classes and
efficiency levels are necessary for these
two types of RCU units. (CA IOUs, No.
56 at p. 2)
Consistent with the comment from
Manitowoc, DOE plans to continue
using this differential of 0.2 kWh per
100 lb of ice to differentiate between
RCUs with and without remote
compressors.
Batch Efficiency Levels for HighCapacity Ice Maker
DOE has established baseline and
incremental efficiency levels for largecapacity ice makers in the newly
extended capacity between 2,500 and
4,000 lb ice/24 hours.
AHRI noted that the current efficiency
standard for high-capacity batch
machines was established based on the
performance of ice makers available in
the marketplace and that extending this
efficiency level to ice makers with
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14879
capacities exceeding 2,500 lb ice/24
hours may not be appropriate. AHRI
recommended that DOE either select
and analyze products in this capacity
range or refrain from regulating these
products if there are not actually enough
high-capacity batch machines available
for DOE to analyze. (AHRI, No. 49 at pp.
3–4)
Manitowoc stated that efficiency
curves are typically flat for icemakers
with capacities above 2,000 to 2,500 lb
ice/24 hours and noted that this
phenomenon is driven mainly by trends
in compressor efficiencies, which have
decreasing efficiency gains above a
certain size. Additionally, Manitowoc
commented that it tends to use multiple
evaporators for large-capacity machines,
rather than making new evaporators for
every size, so its overall evaporator
performance also does not improve
significantly over a certain size.
(Manitowoc, Public Meeting Transcript,
No. 42 at pp. 48–49)
However, Manitowoc also commented
that DOE did not adequately analyze the
efficiency of ice machines in the 2,000
to 4,000 lb ice/24 hour capacity range.
Manitowoc suggested that it is likely
that, above a certain capacity, DOE will
find that the relative benefit of some
design options to be lower due to the
relatively higher efficiency of the
baseline components already in use.
(Manitowoc, No. 54 at p. 3)
Howe commented that most highcapacity ice makers are inherently more
efficient than their lower-capacity
counterparts and thus cannot be
expected to achieve the same
incremental efficiency gains. Howe
added that, if incremental efficiency
gains do indeed vary significantly by
harvest capacity, equipment class
definitions may need to change. (Howe,
No. 51 at pp. 2–3)
Hoshizaki recommended that DOE
make equipment plots for high-capacity
batch models in order to compare
existing models against the proposed
efficiency levels. (Hoshizaki, No. 53 at
p. 2)
Hoshizaki commented that DOE needs
to analyze the available data for all
eligible RCU models rather than just
relying on software assumptions to
inform its analysis. Hoshizaki added
that there is not enough data available
for DOE to adequately assess highcapacity (>2,500 lb ice/24 hours) RCU
energy use and recommended that
manufacturers provide input to DOE
regarding these high-capacity units.
(Hoshizaki, No. 53 at p. 1)
In response to AHRI, DOE reiterates
that there is precedence for setting
standards for capacity ranges for which
equipment is not being sold, including
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when DOE adopted standards for aircooled IMH cube type ice makers up to
2,500 lb ice/24 hours, even though no
such equipment is manufactured with
capacities above 1,650 lb ice/24 hours.
DOE simply is extending the capacity
range of the standard for consistency
with the applicability of the test
procedure. DOE notes that it has
proposed efficiency levels for the larger
ice makers that, to the extent possible,
do not change as a function of harvest
capacity. Manitowoc’s comments
suggest that larger-capacity ice
machines would have comparable
efficiency level as compared with lowercapacity machines, and Howe’s
comments suggest that larger-capacity
ice machines are inherently more
efficient. Hence, the constant energy use
efficiency level would be appropriate.
The commenters did not highlight any
other specific factors that would suggest
that the constant energy use approach is
inappropriate. Examination of the
limited available data showing rated
energy use as a function of harvest
capacity certainly supports the
approach, even though there is much
less data to consider that at the lower
capacity levels.
In response to Manitowoc’s comment
regarding analysis of batch type ice
makers in the 2,000 to 4,000 lb ice/24
hours harvest capacity range, DOE notes
that it has conducted analysis for three
of these products—given the limited
number of such products available, this
likely represents a greater percentage of
the available products than DOE
evaluated at lower-harvest-capacity
rates. Because, as mentioned by
Manitowoc, efficiency characteristics of
the components of ice makers such as
compressors and evaporators no longer
improve as capacity increases, it is
reasonable to expect that ice maker
efficiency will also remain constant at
high-harvest-capacity rates. For this
reason, it is appropriate to represent
performance of the full harvest capacity
range with the available ice makers of
the highest harvest capacities, as DOE
has done.
In response to Howe’s comment, DOE
has not considered reductions in
efficiency at constant kilowatt-hours per
100 lb ice levels across the harvest
capacity range. Instead, DOE has
considered reductions in energy use in
terms of percentages of baseline energy
use. Hence, the energy use reductions
associated with the incremental
efficiency levels would be significantly
less for a large-harvest-capacity ice
maker with an already inherently low
energy use than it would for a lowerharvest-capacity ice maker. Further, if
the larger-capacity ice makers are
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inherently more efficient, as Howe
contends, DOE’s approach using
efficiency levels that do not vary with
capacity should not be overly
aggressive, i.e. setting efficiency levels
too stringently.
With respect to Hoshizaki’s
recommendation regarding examination
of efficiency plots, DOE has reviewed
energy use data for all products for
which such data is available. The
maximum efficiency levels considered
in the analysis are not generally attained
by existing equipment—this is largely
due to the consideration of design
options often considered not to be costeffective by manufacturers, such as
brushless DC motors and drain water
heat exchangers. However, DOE’s
analysis results compared well to the
maximum available without screened
technologies efficiency level.
In response to the second comment
from Hoshizaki, DOE notes that the
analysis for high-capacity units
considered several pieces of
information, including available
performance rating data of the AHRI
database and confidential interviews
with manufacturers. A significant
amount of the information obtained
from manufacturers in confidential
interviews was obtained during the
NOPR phase, in part in response to
preliminary analysis phase comments,
such as the Hoshizaki comment,
recommending some information
exchange. In addition, DOE purchased
and conducted reverse engineering on
the largest-capacity batch and
continuous type ice makers made by the
manufacturers that comprise 90 percent
or greater share of the ice maker market.
DOE also conducted energy testing on a
few of these ice makers. DOE believes
that its analysis of RCU equipment is
representative of the large-capacity
equipment classes. Additional
information on the teardown analysis is
available in chapter 5 of the NOPR TSD.
Discrepancies Between Maximum
Technology Levels and Most-Efficient
Equipment Available in the Marketplace
NPCC, ASAP, and NEEA/NPCC
commented on the max-tech efficiency
levels (i.e., least energy consumptive
level) and that, in some cases, max-tech
levels were less efficient than the mostefficient level on the marketplace (i.e.,
‘‘max-available’’ energy level). NPCC
further commented that DOE should
indicate whether this discrepancy is due
to technologies that were screened out.
NEEA/NPCC pointed to products in a
Natural Resources Canada (NRCan)
database that surpassed DOE’s max-tech
levels. (NPCC, Public Meeting
Transcript, No. 42 at pp. 45–46; ASAP,
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Public Meeting Transcript, No. 42 at p.
50; NEEA/NPCC, No. 50 at pp. 2–4)
NPCC also recommended that DOE
investigate whether there are superior
technologies on the market that were
not being analyzed simply because of
the way max-tech is defined. NPCC
added that the process by which design
options are screened out should be very
deliberate. (NPCC, Public Meeting
Transcript, No. 42 at pp. 53–54)
Scotsman noted that, even within a
single equipment class, maximum
technology levels will differ among
models. For example, although DOE is
considering compressor upgrade as a
design option, many ice maker units are
already using the most-efficient
compressor suitable to their respective
applications. Scotsman added that the
analytical model used to calculate
energy use for max-tech levels had not
been validated and was thus unreliable.
(Scotsman, No. 46 at p. 4)
DOE acknowledges that there are
units on the market that surpass the
max-tech levels it proposed for the
preliminary analysis. In some cases
maximum available efficiency units
include technologies that DOE had
decided not to consider. For example,
some max-tech units utilize proprietary
technologies that are not available to the
majority of manufacturers and were
screened out in the screening analysis.
Due to these differences, DOE’s maxtech efficiency levels did not always
exceed the max-available levels found
on the market. Because they are
representative of the whole market,
DOE’s max-tech levels must take into
account issues with proprietary
technologies as well as utility issues
stemming from certain technologies
(such as chassis size increases or ice
cube shapes).
In the NOPR phase, DOE made several
changes to the preliminary analysis.
These changes included:
• Adding a design option to allow for
growth of the unit to increase the size
of the condenser and/or evaporator;
• adjusting assumptions regarding
maximum compressor EER levels based
on additional research and confidential
input from manufacturers;
• adjusting potable water
consumption rates for batch type ice
makers subject to a floor that represents
the lowest potable water consumption
rate that would be expected to flush out
dissolved solid reliably;
• adding a design option to allow
condenser growth in water-cooled
condensers; and
• adding a drain water heat exchanger
design option.
These changes have led to new maxtech levels. These levels are compared
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to the most-efficient levels available on
the market in Table IV.18. The levels are
also compared with the most-efficient
levels available that do not use
technologies that DOE screened out in
the screening analysis (called ‘‘max
available without screened
technologies’’). Specifically, for batch
type ice makers, the differences between
these two max available market levels
are that the max using analyzed
technologies levels do not consider (a)
low-thermal-mass evaporators, and (b)
tube ice evaporators. The new max-tech
levels all exceed the ‘‘max available
without screened technologies’’
efficiency levels. DOE also notes that
this discrepancy only existed for batch
units, as DOE did not screen out any
continuous unit technologies in its
engineering analysis.
DOE considered max-tech and maxavailable levels as part of its analysis.
The max-tech levels for batch and
continuous type ice makers are
discussed in section IV.D.2.e. In
addition to comparing the max-tech,
‘‘most efficient on market’’, and the
‘‘max available without screened
technologies’’ efficiency levels for batch
type ice makers. Table IV.18 provides
brief explanations for the differences
between max-available and max-tech
levels. More details regarding the design
options that correlate with the different
efficiency levels are provided in the
NOPR TSD. DOE requests comments on
the max-tech levels identified in today’s
NOPR, the max available and max
available without screened technologies
levels, and the reasons cited for the max
tech/max available differences.
TABLE IV.18—COMPARISON OF LEVELS FOR BATCH AUTOMATIC COMMERCIAL ICE MAKERS
Max-available
without
screened technologies
(%)
Max-available
(%)
Equipment class
Max-tech level
IMH–W–Small–B ...........................
IMH–W–Med–B .............................
IMH–W–Large–B ...........................
30% ...............................................
22% ...............................................
16% (at 2,600 lb ice/24 hours) .....
22.0
15.7
8.3
24.5
22.4
22.5
IMH–A–Small–B ............................
IMH–A–Large–B ............................
33% ...............................................
33% (at 800 lb ice/24 hours) ........
21% (at 1,500 lb ice/24 hours) .....
Not analyzed .................................
21% (at 1,500 lb ice/24 hours) .....
21% (at 2,400 lb ice/24 hours) .....
Not directly analyzed ....................
Not directly analyzed ....................
Not directly analyzed ....................
35% ...............................................
41% ...............................................
36% ...............................................
23.6
20.7
23.6
21.3
24.6
15.7
24.6
40.2
19.0
15.1
22.2
27.6
27.4
29.6
19.0
15.1
22.5
32.9
35.8
33.4
RCU–NRC–Small–B .....................
RCU–NRC–Large–B .....................
RCU–RC–Small–B ........................
RCU–RC–Large–B ........................
SCU–W–Small–B ..........................
SCU–W–Large–B ..........................
SCU–A–Small–B ...........................
SCU–A–Large–B ...........................
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Baseline Efficiency Levels for Currently
Unregulated Ice Makers
For continuous and high-capacity
batch type ice makers, AHRI
recommended that DOE derive its
baseline efficiency levels from machines
that are currently on the market, for
which AHRI’s new directory of certified
products could be a useful information
source. AHRI cautioned, however, that
its certification program was new and
that it expected the data to change after
completion of its 2012 test program.
(AHRI, No. 49 at p. 3)
Manitowoc asserted that, while
EPACT 2005 is the correct baseline
efficiency level for batch equipment,
continuous type ice machines do not
have sufficient history under any
alternative certification programs and
therefore require careful review and
analysis by DOE prior to setting
efficiency levels. (Manitowoc, No. 54 at
p. 3)
Hoshizaki asserted that DOE should
not use Canadian levels for continuous
type ice makers and instead suggested
that DOE use efficiency levels
developed for machines that are
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currently on the market. (Hoshizaki, No.
53 at p. 1)
In the preliminary analysis, DOE
proposed a set of equations to represent
baseline efficiency levels for the 12
continuous equipment classes. 77 FR
3404 (Jan. 24, 2012). The equations were
developed based on publicly available
information of continuous type ice
maker energy use for products on the
market. As there was no source of ice
quality data for most of these products
to allow calculation of the energy use
consistent with the new test procedure,
which calls for adjustment of the rating
to account for ice hardness, DOE made
these adjustments using ice hardness
equal to 0.85 for nugget ice makers and
0.8 for flake ice makers. Further details
of this analysis are available in the
preliminary analysis TSD.
DOE revised its development of
continuous type ice maker efficiency
levels for the NOPR, based on data for
continuous type ice machines that was
available on the AHRI database Web site
as of October 11, 2012. The database
now contains ratings for ice quality,
which DOE incorporated into its
analysis. DOE’s analyses consider
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Reason for gap between maxavailable and max available without screened technologies
Proprietary technology.
Proprietary technology.
Proprietary technology and utility
issues.
No gap.
proprietary technology.
No gap.
Proprietary
issues.
No gap.
No gap.
Proprietary
Proprietary
Proprietary
Proprietary
technology and utility
technology.
technology.
technology.
technology.
higher max tech levels than the max
available levels, as represented by the
AHRI data, because the analysis
considers use of design options, such as
higher efficiency permanent magnet
motors, which are not used in the
majority of existing ice makers. DOE’s
continuous baseline levels for the NOPR
analysis are presented in Table IV.11.
DOE has taken advantage of the new
information for continuous type ice
makers that has become available on the
AHRI Web site to support its selection
of efficiency levels for these equipment
classes.
General Methodology
Howe asked that DOE further clarify
the methodology it used to establish
efficiency and technology levels,
especially for equipment classes in
which there are few models available.
Howe also asked whether DOE
considered the refrigerating conditions
used to produce ice or the typical
efficiency levels associated with the
refrigeration system. (Howe, No. 51 at
p. 3)
DOE does not have sufficient
resources to thoroughly analyze all
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conditions used to produce ice and the
capacity and power input of the
equipment’s refrigerant compressors
when operating at these conditions.
a. Improved Condenser Performance in
Batch Equipment
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equipment classes. Hence, the analyses
for some classes are used to represent
other classes. The analysis prioritized
those classes for which shipments and
the number of models available are
high. The energy model used to support
the analysis, which is described in the
NOPR TSD, considers the refrigerating
Manitowoc added that increasing the
size of the condenser while maintaining
a constant evaporator size can also
interfere with the ability of the ice
machine to properly make ice over the
full range of ambient conditions.
Manitowoc stated that DOE’s analysis is
only concerned with performance at
90 °F air/70 °F water testing conditions,
but that real ice makers have to work in
air temperatures ranging from 50 to
110 °F and water temperatures from 40
to 90 °F. As air temperature drops,
Manitowoc stated, unless special
refrigerant management devices are
employed, a larger condenser will be
forced to store more refrigerant at a
lower temperature. This will prevent
batch type ice machines from being able
to harvest ice at low ambient
temperatures, according to Manitowoc.
(Manitowoc, No. 54 at p. 2) Similarly,
Scotsman commented that increasing
the efficiency of the freeze cycle will
lengthen the harvest process and
minimize overall energy savings.
(Scotsman, Public Meeting Transcript,
No. 42 at pp. 59–60) Scotsman asserted
that DOE’s analysis of condenser surface
area must include this impact on the
batch harvest cycle. (Scotsman, No. 46
at p. 3)
Hoshizaki commented that
manufacturers would need more time to
During the preliminary analysis, DOE
considered size increase for the
condenser to reduce condensing
temperature and compressor power
input. DOE requested comment on use
of this design option and on the
difficulty of implementing it in ice
makers with size constraints.
AHRI commented that most
condensers are already optimized and
occasionally oversized; therefore,
further increasing condenser area would
not have any efficiency benefits and
could instead necessitate increased
cabinet size. (AHRI, No. 49 at p. 2)
Manitowoc commented that the
outdoor condensers of RCUs can more
easily accommodate size increases than
the condensers incorporated into IMH
equipment. However, Manitowoc also
noted that increasing the size of the
condenser coil in order to improve
efficiency would necessitate an
increased level of refrigerant.
Manitowoc stated that this could require
the installation of a larger receiver in the
ice-making head, which may be difficult
due to size constraints. (Manitowoc,
Public Meeting Transcript, No. 42 at p.
59)
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3. Design Options
After conducting the screening
analysis and removing from
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consideration the technologies
described above, DOE included the
remaining technologies as design
options in the NOPR engineering
analysis. These technologies are listed
in Table IV.19, with indication of the
equipment classes to which they apply.
evaluate the implications of using larger
water-cooled condensers on a closedloop system. Although larger
condensers would increase the
efficiency of heat transfer, Hoshizaki
opined that this benefit must be
compared with the increased final cost
to the consumer as well as the potential
need to increase cabinet size.
(Hoshizaki, No. 53 at p. 2)
In response to Manitowoc’s written
comments, DOE has considered data
obtained through testing of water-cooled
units, as well as data provided by
manufacturers on expected efficiency
increases versus condenser growths.
DOE notes that the key concerns
expressed in Hoshizaki’s comment
relate to the potential need to increase
cabinet size and the concern about
whether the larger condenser (and
perhaps cabinet) is cost-justified. As
discussed in section IV.C.d, DOE has
considered a modest size increase for
the ice-making head for some ice maker
equipment classes. Answering the
question of whether condenser size
increase within these modest
allowances for cabinet size increase is
cost-effective is a key goal of the DOE
analyses—the potential that the
approach is not cost-effective is not a
relevant argument for screening out this
technology.
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In response to Scotsman and
Manitowoc’s written comments, DOE
conducted testing to assess the
correlation of batch type ice maker
efficiency level with condensing
temperature and has used this
information, which accounts for the
increase in harvest energy use
associated with lower condensing
temperature, to adjust its analyses. DOE
tested a water-cooled batch unit using
different water-flow settings; the results
are shown in Table IV.20. DOE notes
that these test results indicate that there
are energy benefits from increasing
condenser area, even though harvest
cycle energy use increases. The results
show that the increase in harvest cycle
energy use represents a loss of 15
percent of the gain that would have
been achieved if harvest energy use had
not increased. DOE used these test
results to adjust the modeled harvest
energy when condenser improvement
such as size increase was applied as a
design option. These analyses are
described in chapter 5 of the NOPR
TSD.
TABLE IV.20—CONDENSER WATER TEST RESULTS
Test setting 1
(factorysetting)
Test attribute
Test setting 2
Test setting 3
97
375
4.67
104
21.2
0.53
15%
107
361
5.13
81
17.9
0.44
12%
111
355
5.28
73
17.0
0.42
N/A
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Condensing Temperature °F .......................................................................................................
Ice Harvest Rate lb ice/24 hours .................................................................................................
Energy Consumption kWh/100 lb ice ..........................................................................................
Average Harvest Time (s) ...........................................................................................................
Average Harvest Energy Wh .......................................................................................................
Average Harvest Energy per Ice kWh/100 lb ..............................................................................
Percent of Savings Lost due to Harvest Energy Increase ..........................................................
DOE inspected baseline and highefficiency units, including condenser
sizes typical of each. For equipment
classes for which DOE inspected highefficiency units, DOE considered
maximum condenser sizes consistent
with the inspected units. For equipment
classes where DOE did not have such
information, DOE considered maximum
condenser sizes consistent with the
range of chassis sizes of commercially
available equipment of the given class
and harvest capacity. DOE notes that
none of the evaluated IMH or SCU
equipment has receivers, thus indicating
that they would not be needed for the
range of condenser sizes DOE
considered in its analysis for these
equipment classes. DOE also considered
whether a larger remote condenser
would require installation of a larger
receiver, and talked with receiver
manufacturers about receiver sizing.
DOE did not seek to increase receiver
sizes for any of the models analyzed.
In response to comments by AHRI and
Manitowoc, DOE studied the
condensing temperatures of tested units
to set limits for available efficiency
improvement. DOE in its analyses
considered only condenser changes that
resulted in condensing temperatures
within the range of those observed in
the tested ice makers for comparable
equipment classes (for instance DOE
used different minimum condensing
temperatures for air-cooled and watercooled equipment). These analyses are
described in chapter 5 of the NOPR
TSD.
b. Harvest Capacity Oversizing
NPCC noted that many ice makers
may be oversized for their particular
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applications, suggesting that there
would be little compromise of customer
utility if the capacity available for a
given ice maker chassis size decreased
as a result of design changes that
increased their efficiency. (NPCC,
Public Meeting Transcript, No. 42 at pp.
60–61)
Manitowoc countered that its
customers are very aware of how much
ice they need and that they
consequently size machines for peak
demand days, rather than average use.
Manitowoc added that it is very
important that customers not shut down
on days with high demand, such as the
4th of July. (Manitowoc, Public Meeting
Transcript, No. 42 at p. 63)
DOE did not investigate potential
down-sizing of equipment, instead
relying on information regarding
commercially available units as the
basis for consideration of what sizes are
acceptable for given capacity levels.
c. Open-Loop Condensing Water
Designs
Open-loop cooling systems use
condenser cooling water only once
before disposing of it, whereas closedloop (single-pass) systems repeatedly
recirculate cooling water. In closed
loops, the water is cooled in a cooling
tower and recirculated to accept heat
from the automatic commercial ice
maker condenser again. Alternatively,
the water passes through another heat
exchanger where the heat is removed
and used in another piece of equipment,
such as a space or water heater, before
cycling back to the ice maker condenser.
Although some condenser water may
still be lost to evaporation in cooling
towers, closed-loop systems still have
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negligible condenser water disposal or
consumption compared to open-loop
systems.
The Alliance expressed strong
opposition to open-loop condenser
water cooling for automatic commercial
ice makers, arguing that such
technology is obsolete and excessively
wastes water and energy. The Alliance
noted that more energy-efficient
technologies such as air cooling, remote
condensing, and closed-loop watercooling systems have made single-pass
water cooling unnecessary. Therefore,
the Alliance urged DOE to disallow all
ice makers that can be installed and
operated with a single-pass cooling
system. (Alliance, No. 45 at pp. 3–4)
DOE recognizes that open-loop watercooling systems use significantly more
water than other condenser cooling
technologies. However, DOE determined
after the Framework public meeting that
its rulemaking authority extends only to
the manufacturing of equipment and not
to the installation or usage of
equipment. Thus, DOE has no authority
to mandate that dual-use water-cooled
machines (those that can be used in
either closed-loop or open-loop
configurations) be used with closedloop systems. Furthermore, DOE is not
aware of any potential design
requirements it could impose that
would effectively prohibit open-loop
cooling systems for water-cooled ice
makers. Even if a design requirement
could be effective in this regard, DOE
can only adopt either a prescriptive
design requirement or a performance
standard for commercial equipment. (42
U.S.C. 6311(18)) The focus of this
rulemaking is an equipment
performance standard. Due to the nature
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of this rulemaking, DOE is not
considering any prescriptive design
requirements, and open-loop cooling
systems therefore remain a viable option
for manufacturers of water-cooled ice
makers who want to reduce their water
consumption.
d. Condenser Water Flow
EPACT 2005 prescribes maximum
condenser water use levels for watercooled cube type automatic commercial
ice makers. (42 U.S.C. 6313(d)) 34 For
units not currently covered by the
standard (continuous machines of all
harvest rates and batch machines with
harvest rates exceeding 2,500 lb ice/24
hours), there currently are no limits on
condenser water use.
In this rulemaking, DOE considered
using higher condenser water flow rates
as a design option for water-cooled ice
makers.
In chapter 2 of the preliminary TSD,
DOE indicated that the ice maker
standards primarily focus on energy use,
and that DOE is not bound by EPCA to
comprehensively evaluate and propose
reductions in the maximum condenser
water consumption levels, and likewise
has the option to allow increases in
condenser water use, if this is a costeffective way to improve energy
efficiency.
DOE did not analyze potential
changes in condenser water use
standards during the preliminary
analysis. However, it did propose an
approach for balancing energy use and
condenser water use in the engineering
analysis in a way that maintains the
rulemaking’s focus on energy use
reduction while appropriately
considering the cost implications of
changing condenser water use. DOE
proposed using appropriate
representative values for water and
energy costs, product lifetime, and
discount rates to calculate a
representative LCC for baseline and
modified design configurations as part
of the engineering analysis. In this way,
the engineering analysis would develop
a relationship between energy efficiency
and manufacturing cost as is customary
in engineering analyses (i.e., the costefficiency curves), but the ordering of
different design configurations in this
curve would be based on minimizing
the representative LCC calculated for
the candidate design configurations at
each successive efficiency level. Using
34 The table in 42 U.S.C. 6313(d)(1) states
maximum energy and condenser water usage limits
for cube-type ice machines producing between 50
and 2,500 lb of ice per 24 hour period (lb ice/24
hours). A footnote to the table states explicitly the
water limits are for water used in the condenser and
not potable water used to make ice.
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this proposed analytical approach, an
energy-saving increase in condenser
water use would be expected to be costeffective when the remaining design
options, which do not change water use,
have greater LCC increases than the
option of increasing condenser water
use. This approach would avoid the
complexity of developing several cost
curves representing multiple condenser
water use levels and determining in the
downstream analyses the efficiency
levels at which increasing condenser
water use would be appropriate. During
the preliminary analysis, DOE requested
comment on this approach for
addressing condenser water use.
AHRI commented that water-cooled
ice makers are already efficient products
and that reducing condenser water
consumption could significantly
increase their energy use. AHRI and
Scotsman both cautioned that DOE must
consider the impact that lower
condensing temperatures could have on
the harvest rate of batch type ice makers
and ensure that product utility is not
diminished by implementing new
condenser water use standards. (AHRI,
No. 49 at p. 4; Scotsman, Public Meeting
Transcript, No. 42 at p. 70)
In the public meeting discussions,
Manitowoc suggested that DOE consider
decreasing the allowable condenser
water use, which could be a more
economical approach if water costs
increase. (Manitowoc, Public Meeting
Transcript, No. 42 at pp. 70–72)
However, Manitowoc also noted in its
written comments that condenser water
use is carefully managed to ensure that
ice makers can harvest ice under worstcase conditions and maintain water
velocities within specified limits in
order to avoid erosion. Manitowoc
expressed doubt about the ability of
DOE’s energy model to accurately
predict the effects of these variables,
and for this reason, Manitowoc strongly
discouraged introducing condenser
water use standards. (Manitowoc, No.
54 at pp. 3–4)
DOE stated that EPCA’s antibacksliding provision in section
325(o)(1), which lists specific products
for which DOE is forbidden from
prescribing amended standards that
increase the maximum allowable water
use, does not include ice makers.
However, Earthjustice asserted that DOE
lacks the authority to relax condenser
water limits for water-cooled ice
makers. Earthjustice argued that the
failure of section 325(o)(1) to
specifically call out ice maker
condenser water use as a metric that is
subject to the statute’s prohibition
against the relaxation of a standard is
not determinative. On the contrary,
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Earthjustice maintained that the plain
language of EPCA shows that Congress
intended to apply the anti-backsliding
provision to ice makers. Earthjustice
commented that section 342(d)(4)
requires DOE to adopt standards for icemakers ‘‘at the maximum level that is
technically feasible and economically
justified, as provided in [section 325(o)
and (p)].’’ (42 U.S.C. 6313(d)(4))
Earthjustice stated that, by referencing
all of section 325(o), the statute pulls in
each of the distinct provisions of that
subsection, including, among other
things, the anti-backsliding provision,
the statutory factors governing economic
justification, and the prohibition on
adopting a standard that eliminates
certain performance characteristics. By
applying all of section 325(o) to icemakers, section 342(d)(4) had already
made the anti-backsliding provision
applicable to condenser water use,
according to Earthjustice. Finally,
Earthjustice stated that even if DOE
concludes that the plain language of
EPCA is not clear on this point, the only
reasonable interpretation is that
Congress did not intend to grant DOE
the authority to relax the condenser
water use standards for ice makers.
Earthjustice added that the antibacksliding provision is one of EPCA’s
most powerful tools to improve the
energy and water efficiency of
appliances and commercial equipment,
and Congress would presumably speak
clearly if it intended to withhold its
application to a specific product.
(Earthjustice, No. 47 at pp. 4–5)
Scotsman commented that balancing
condenser water use with energy use
was a reasonable analytical approach.
(Scotsman, No. 46 at p. 3) Scotsman
added that including condenser water
usage in the overall energy use of a
machine would also impact continuous
type ice machines by affecting ice
hardness. (Scotsman, Public Meeting
Transcript, No. 42 at p. 70)
The Alliance argued that water use
and energy use cannot be compared on
a simple price basis because of key
differences between the two resources.
While energy comes from multiple
sources and is a commodity whose
prices fluctuate based on supply and
demand, fresh water is in limited
supply, the Alliance stated. Hence,
water prices are heavily regulated and
based on the cost of treatment and
delivery, which is less directly affected
by supply and demand, according to the
Alliance. Therefore, the Alliance
recommended that DOE consider the
marginal costs of alternative water
sources, such as desalination, in its
analyses to properly account for all
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water costs as applied to water-cooled
condensers. (Alliance, No. 45 at p. 4)
In response to Earthjustice’s
comment, DOE maintains its position
from the preliminary analysis that the
anti-backsliding provision of EPCA (42
U.S.C. 6313(d)(4)) does not apply to
condenser water use in batch-type
automatic commercial ice makers.
While EPCA’s anti-backsliding
provision (42 U.S.C. 6295(o)) applies to
consumer products, 42 U.S.C. 6313(d)(4)
makes the backsliding provision
applicable to automatic commercial ice
makers. However, 42 U.S.C. Sec.
6295(o)(1) anti-backsliding provisions
apply to water in only a limited set of
residential appliances and fixtures.
Under 42 U.S.C. Sec. 6295(o)(1), ‘‘the
Secretary may not prescribe any
amended standard which increases the
maximum allowable energy use, or, in
the case of showerheads, faucets, water
closets, or urinals, water use, or
decreases the minimum required energy
efficiency, of a covered product.’’ This
provision links automatic commercial
ice makers to the energy efficiency antibacksliding provision as a covered
product, and does not include automatic
commercial ice makers among the
products covered by the water efficiency
anti-backsliding provision. Thus, this
section of EPCA prohibits DOE from
amending any standard in such a way
as to decrease minimum energy
efficiency for any covered automatic
commercial ice maker equipment class.
It does not, however, prohibit an
increase in water use in any products
other than those enumerated in the
statute, and nothing in 6313(d)(4)
expands the specific list of equipment
or appliances to which the water antibacksliding applies. Therefore, an
increase in condenser water use would
not be considered backsliding under the
statute. Nevertheless, the proposals do
not include increases in condenser
water use.
Noting that condenser water
standards are already in place for batch
type ice makers, DOE has decided to
consider an increase in condenser water
use as a design option to improve
energy efficiency for all water-cooled ice
makers. Acknowledging the concerns of
stakeholders such as AHRI, Manitowoc,
and Scotsman, DOE recognizes that
such an approach must consider the
cost-effectiveness of this design option
based on the end-user’s water cost. DOE
does not believe that the contemplated
changes would diminish product utility,
because an increase in the maximum
allowed condenser water use would
increase the flexibility of manufacturers
to meet the condenser water use
standard. Manufacturers would
obviously not be required to increase
condenser water use, especially if such
a design decision would negatively
impact the energy use or harvest rate of
their ice makers.
In response to Manitowoc’s
observation that water velocities must
be maintained within specified limits in
order to avoid erosion, DOE conducted
an analysis to determine whether
current levels of water use in watercooled condensers are close to
exceeding these limits. DOE has learned
from manufacturers of water-cooled
condensers that water flow rates
generally should not exceed 3.5 gallons
per minute per nominal ton of
condenser cooling capacity (gpm per
ton).35 DOE’s analysis of test data for
batch machines shows that the
maximum condenser water flow rate
occurs shortly after harvest, and that
there is some room for increase of
14885
condenser water flow rate with the 3.5
gpm per ton limit. DOE considered
some increase of condenser water flow
for batch type units that did not already
operate at this limit at the start of the
freeze cycle. Unlike batch type ice
makers, whose condenser loads spike
shortly after the harvest cycle,
continuous type ice makers typically
operate in steady-state. DOE’s testing
shows that flow rates in continuous type
ice makers are therefore far from the
maximum levels recommended to
prevent erosion. However, DOE notes
that it did not perform direct analysis on
any water-cooled continuous equipment
classes.
As the manufacturers and AHRI point
out, DOE must be careful in the analysis
of condenser water to ensure that the
complex relationship between
condenser water and machine energy
usage are modeled correctly. However,
balancing energy use and condenser
water use following the approach
outlined above greatly simplifies an
otherwise highly complex, threedimensional analysis of design options,
condenser water use levels, and
efficiency. This analysis approach
helped DOE determine whether
increasing condenser water limits could
cost-effectively save electricity.
DOE tested three water-cooled ice
makers with varying condensing water
flow to evaluate the potential for energy
savings and the cost-effectiveness of
using this approach. The results of this
evaluation for a batch type ice maker are
shown in Table IV.21. The analysis
assumed that in the field half of the ice
makers would be used in open systems
and half in closed-loop systems, which
significantly reduce water flow, as
documented in chapter 5 of the NOPR
TSD.
TABLE IV.21—TEST DATA FOR A WATER-COOLED BATCH UNIT
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Condensing Temperature, °F ......................................................................................................
Harvest Capacity, lb/24 hr ...........................................................................................................
Energy Consumption, kWh/100 lb ...............................................................................................
LCC Operating Cost, $/100 lb .....................................................................................................
Condenser Water Use, gal/100 lb ...............................................................................................
The analysis shows that increasing
condenser water flow is not a costeffective way to reduce energy use. This
was demonstrated also for the two
continuous type ice makers that were
tested. As a result, DOE did not
comprehensively evaluate this approach
for all water-cooled equipment classes
in its engineering analysis. Additional
details are available in chapter 5 of the
NOPR TSD.
e. Compressors
Scotsman commented that the highEER compressors in DOE’s analysis may
not be feasible for ice makers,
particularly batch type ice makers, in
which liquid refrigerant can often enter
the compressor during the harvest
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process. Scotsman noted that the design
changes used by compressor
manufacturers to improve EER can
reduce reliability, for instance placing
the compressor suction line closer to the
suction intake within the shell, which
can cause liquid refrigerant to impinge
on the suction valve during harvest and
rapidly lead to compressor failure.
35 Personal communication with Piyush Desai at
Packless Industries on May 16, 2012.
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(Scotsman, No. 46 at p. 5) Manitowoc
echoed Scotsman’s second point,
indicating that a direct suction
compressor would allow liquid to enter
the compressor cylinder and damage the
valve system. (Manitowoc, No. 54 at p.
2)
In response to these comments, DOE
consulted with manufacturers regarding
which compressors are appropriate for
ice makers. DOE removed from its
analysis those compressors that
manufacturers have indicated are
unsuitable for use in ice makers. As part
of the NOPR analyses, DOE also
considered additional compressors of
compressor lines that manufacturers
indicated are acceptable. The impact of
these changes in the analysis on the
predicted potential efficiency
improvement associated with use of
higher efficiency compressors varied by
equipment class. Additional details are
available in chapter 5 of the NOPR TSD.
f. Limitations on Available Design
Options
Manitowoc commented that the small
size of the ice maker industry makes it
difficult for ice maker manufacturers to
implement new technologies or
influence the component (e.g.,
compressor or motor) suppliers that
they depend on for efficiency gains.
Manitowoc noted that, compared to
other appliance industries, ice maker
sales volumes do not drive component
suppliers to make design changes, so ice
maker manufacturers are limited to
those changes that suppliers will
implement for larger customers.
Furthermore, Manitowoc noted that,
rather than being independent
appliances, ice makers are typically part
of a larger equipment chain for
delivering food service products, which
places them under physical constraints
and causes their technology changes to
have broader impacts on the entire food
delivery industry. (Manitowoc, Public
Meeting Transcript, No. 42 at pp. 14–15)
For the NOPR analyses, DOE has used
design options that are commercially
available. Many of these technologies
are found in ice makers that were
inspected, and a few are available from
component manufacturers. DOE has
taken care to ensure that those design
options identified do apply to these
products.
• For example, DOE has removed
from its analysis any compressors that
may potentially interfere with ice maker
operation (based on their design).
• DOE has also included an option to
increase chassis sizes (in order to grow
internal components such as heat
exchangers), but limited chassis growth
design options to only cover the modest
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levels suggested by the available
equipment offerings
Further information on DOE’s
analyses is contained in sections
IV.D.4.e and IV.D.4.f.
4. Development of the Cost-Efficiency
Relationship
In this rulemaking, DOE has adopted
a combined efficiency level/design
option/reverse engineering approach to
developing cost-efficiency curves. To
support this effort, DOE developed
manufacturing cost models based
heavily on reverse engineering of
products to develop a baseline MPC.
DOE estimated the energy use of
different design configurations using an
energy model whose input data was
based on reverse engineering, automatic
commercial ice maker performance
ratings, and test data. DOE combined
the manufacturing cost and energy
modeling to develop cost-efficiency
curves for automatic commercial ice
maker equipment based on baselineefficiency equipment selected to
represent their equipment classes. Next,
DOE derived manufacturer markups
using publicly available automatic
commercial ice maker industry financial
data, in conjunction with manufacturer
feedback. The markups were used to
convert the MPC-based cost-efficiency
curves into MSP-based curves. Details of
these analyses developed for the
preliminary analysis were presented in
the preliminary analysis TSD and in a
supplementary data publication posted
on the rulemaking Web site.
Stakeholder comments regarding
DOE’s preliminary engineering analyses
addressed the following broad areas:
1. Estimated costs in many cases were
lower than manufacturers’ actual costs.
2. Estimated efficiency benefits of
many modeled design options were
greater than the actual benefits,
according to manufacturers’ experience
with equipment development.
3. DOE should validate its energy use
model based on comparison with actual
equipment test data.
4. DOE should validate its costefficiency analysis by investigating the
relationship of efficiency with retail
prices for ice makers.
5. The incremental costs in the
engineering analysis should take into
consideration the design, development,
and testing costs associated with new
designs.
These topics are addressed in greater
detail in the sections below.
a. Manufacturing Cost
Manitowoc requested that DOE
provide more information on the inputs
and methodology behind calculating the
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MPCs for each efficiency level.
(Manitowoc, Public Meeting Transcript,
No. 42 at pp. 76–77) Manitowoc,
Scotsman, and AHRI all asserted that it
is important for DOE to accurately
assess the potential incremental costs
associated with each efficiency level,
since they will drive the decisions in
this rulemaking. (Manitowoc, Public
Meeting Transcript, No. 42 at pp. 170–
171 and No. 54 at p. 1; Scotsman, Public
Meeting Transcript, No. 42 at p. 173;
AHRI, No. 49 at p. 6)
Regarding the accuracy of DOE’s cost
model, Manitowoc commented that
some of the incremental costs between
efficiency levels were incorrect.
Manitowoc added that, while it could
not provide its bill of materials, it would
be willing to give DOE guidance
regarding the actual costs of
implementing technology design
changes at realistic volumes.
(Manitowoc, Public Meeting Transcript,
No. 42 at pp. 80–81) Scotsman agreed
with Manitowoc that the table of
incremental costs was optimistic at best
and added that changing one
component in an ice maker will often
require also changing other components,
further affecting incremental costs.
(Scotsman, Public Meeting Transcript,
No. 42 at p. 85)
Specifically, Manitowoc, Scotsman,
and AHRI each stated the belief that
DOE has underestimated the
incremental costs of its proposed design
options. (Manitowoc, No. 54 at p. 1;
Scotsman, No. 46 at p. 5; AHRI, No. 49
at p. 6) For example, DOE estimated that
the incremental cost of using an
electronically commutated motor (ECM)
in place of a shaded pole motor would
be $13, whereas Scotsman’s supplier
quoted an incremental cost of $35 for
this same design option. Scotsman
added that, because the ice maker
industry is relatively low-volume, ice
maker manufacturers face large cost
premiums for component technologies.
(Scotsman, No. 46 at p. 5) AHRI noted
that DOE assumed that an 8 percent
increase in compressor efficiency would
cost only $9. However, AHRI asserted
that most compressors currently used in
ice makers are already mechanically
optimized and could therefore achieve
greater efficiency only by switching to
permanent magnet motors, which would
cost seven times more than DOE’s
incremental cost estimate. AHRI
cautioned that DOE should not assume
that information it derived for other
rulemakings is automatically applicable
to ice makers. AHRI also opined that
DOE drastically underestimated the cost
of increasing condenser surface area.
(AHRI, No. 49 at p. 2) Finally,
Manitowoc commented that DOE’s cost
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estimates for ECM versions of the fan
motors and pumps were unrealistically
low. (Manitowoc, No. 54 at p. 2)
In response to Manitowoc’s first
comment, DOE has provided additional
information correlating efficiency levels
and design options in this NOPR and its
accompanying TSD. The TSD details the
design option changes and associated
costs, calculated for each efficiency
level for the equipment analyzed.
In response to the comments by
Manitowoc, Scotsman, and AHRI, DOE
had received very limited feedback from
manufacturers regarding cost estimates
to support its preliminary engineering
analysis. During the NOPR phase of this
rulemaking, DOE emphasized the need
to obtain relevant information from
stakeholders by extending the comment
period by 40 days and welcoming
comment on specific details presented
in the TSD regarding technology options
and costs. Moreover, DOE’s contractor
again worked directly with
manufacturers under non-disclosure
agreements in order to obtain additional
cost information.
DOE has significantly revised its
component cost estimates for the
engineering analysis for the NOPR
phase based on the additional
information obtained, both in
discussions with manufacturers and in
stakeholder comments. DOE used the
detailed feedback that it solicited from
manufacturers to update its cost
estimates for all ice maker components,
significantly increasing its estimates of
nearly all of these costs. Additional
details on the adjusted component costs
are available in chapter 5 of the NOPR
TSD.
b. Energy Consumption Model
The energy consumption model
calculates the energy consumption of
automatic commercial ice makers in
kilowatt-hours per 100 lb of ice based
on detailed description of equipment
design. The DOE analysis for a given
equipment class and capacity applied
the model for a variety of design
configurations representing different
performance levels. The analysis starts
with a baseline design, subsequently
assessing the differing energy
consumption for incrementally more-
efficient equipment designs that utilize
increasing numbers of design options.
The results of the energy consumption
model are paired with the cost model
results to produce the points on the
cost-efficiency curves, which
correspond to specific equipment
configurations. After the publication of
the preliminary analysis, DOE received
numerous stakeholder comments
regarding the methodology and results
of the energy consumption model.
Manitowoc and Howe both
commented that DOE’s models
significantly overstated the efficiency
gains associated with many of the
design options. (Howe, No. 51 at p. 3;
Manitowoc, No. 54 at p. 2) As an
example, Howe pointed out that using a
more efficient fan may not have a
significant impact on the overall
efficiency of the ice maker, since the fan
represents a small fraction of its overall
energy use. (Howe, No. 51 at p. 3)
Manitowoc added that its own tests on
actual ice machines under controlled
conditions resulted in lower
performance gains than those predicted
by the DOE models. (Manitowoc, No. 54
at p. 2)
Manitowoc commented that it would
like to have more information on the
models used in DOE’s engineering
analysis. In particular, Manitowoc
stated that it would like to learn more
about the FREEZE model, since it is
difficult to model the process of freezing
water into ice and even more difficult to
model ice harvesting. Manitowoc noted
that this model will drive DOE’s
estimation of energy efficiency and that
it is important for manufacturers to
understand the impacts of the model
before new standards take effect,
especially if new efficiency levels take
manufacturers to technology levels far
beyond their level of experience.
(Manitowoc, Public Meeting Transcript,
No. 42 at pp. 171–173)
Manitowoc also commented that the
FREEZE model is limited by its inability
to model the harvest portion of the
batch cycle. Manitowoc stated that,
although the harvest portion is shorter
in duration than the freeze portion, it
represents a significant fraction of
energy consumption due to the higher
14887
energy input to the compressor and the
additional energy required to cool the
evaporator after each harvest.
Manitowoc added that many changes
that improve the freeze operation
efficiency, such as increasing condenser
area, also reduce harvest operation
efficiency. Manitowoc expounded on
this example by noting that the
increased condenser surface area
reduces the design temperature of the
refrigerant, which results in lower
energy available during the harvest
cycle, which in turn results in slower
harvest times and an overall increase in
energy during the harvest cycle.
Manitowoc commented that DOE’s
FREEZE model is unable to account for
such behavior. (Manitowoc, No. 54 at
pp. 1–2)
Scotsman and Hoshizaki both
commented that the energy model will
be incomplete until it has been
validated with real test results of
different technology design options.
(Scotsman, Public Meeting Transcript,
No. 42 at pp. 173–174) Hoshizaki
asserted that DOE should not use the
FREEZE model in the analyses until it
has been validated. (Hoshizaki, No. 53
at p. 1)
Scotsman inquired whether DOE
intends to validate its cost-efficiency
model by implementing these design
changes on actual machines and
evaluating their subsequent energy
performance. (Scotsman, Public Meeting
Transcript, No. 42 at pp. 85–86)
In response to comments by
Manitowoc, Howe, and Scotsman, DOE
has made changes to the energy
modeling based on feedback received
from the manufacturers under nondisclosure agreements. To address
concerns by Manitowoc that the
FREEZE model did not adequately
model the effects of increased condenser
size on the harvesting energy, DOE also
performed testing of a water-cooled
condenser batch unit, and used the test
data to develop a relationship between
condensing temperatures and harvest
energy. DOE did note that lower
condensing temperatures did result in
lower overall energy consumption, but
higher harvest energy consumption.
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
TABLE IV.22—TEST DATA FOR A WATER-COOLED BATCH UNIT
Test level
Units
Condenser Temperature ...............................................................................
Ice Harvest ....................................................................................................
Overall Energy Consumption ........................................................................
Average Harvest Energy Consumption ........................................................
LCC Operating Cost .....................................................................................
Condenser Water Use ..................................................................................
°F ......................
lb/24 hr .............
kWh/100 lb .......
Wh ....................
$/100 lb ............
gal/100 lb ..........
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Further information on DOE’s
engineering analysis and energy model
adjustments is contained in sections
IV.D.4.e and IV.D.4.f.
c. Retail Cost Review
AHRI and Hoshizaki both questioned
the accuracy of DOE’s incremental costefficiency analysis. AHRI and Hoshizaki
recommended that DOE validate it by
comparing its results with actual retail
prices. (AHRI, Public Meeting
Transcript, No. 42 at pp. 78–80, 82–83,
174–175, and No. 49 at p. 6; Hoshizaki,
Public Meeting Transcript, No. 42 at p.
84 and No. 53 at p. 1).
In response to AHRI’s and Hoshizaki’s
request for cost validation, DOE
prepared a price analysis for automatic
commercial ice makers to evaluate the
correlation of price with higher ice
maker efficiency. DOE collected list
price information from publicly
available automatic commercial ice
maker manufacturer price sheets for 470
ice makers. DOE collected other
information relevant to the analysis
appropriate sources, including
equipment dimensions, harvest
capacity, ENERGY STAR qualification,
and energy use. For equipment classes
for which there were data available for
more than 20 ice makers, price and ice
harvest rate were shown to have a strong
linear correlation, with R-squared
values ranging from 0.63 to 0.84. This
result indicates that customers pay more
for higher-capacity ice makers.
While an initial evaluation of price
trends with efficiency suggested that
prices are higher for higher efficiency
ice makers, subsequent analysis suggests
that this trend can be attributed to the
trend for reduction in energy use for
higher harvest capacity and the
aforementioned relationship between
price and harvest capacity. For the
equipment classes for which there were
sufficient ice makers to analyze, DOE
determined the best-fit linear
relationship predicting price as a
function of ice harvest rate. DOE then
evaluated the relationship between each
ice maker’s price differential (i.e., the
difference between its price and the
best-fit linear function), expressed as a
percentage of the predicted price, with
the ice maker’s energy consumption rate
(in kWh/100 lb ice), developing best-fit
linear relationships for these trends.
DOE noted that the linear relationships
showed either no growth or very small
growth in price as energy consumption
increased. These results indicate that
there is no correlation between higher
efficiency and higher retail prices for ice
machines. However, DOE did not
conclude, based on this analysis, that
there would be no costs associated with
improving equipment efficiency—
rather, it concluded that retail prices are
not a reliable indicator of these costs.
Additional information on this analysis
can be found in chapter 3 of the NOPR
TSD.
d. Design, Development, and Testing
Costs
Hoshizaki commented that DOE’s
incremental cost-efficiency analysis
must include all aspects of design
changes, including the additional design
time, testing, and increased labor, when
calculating incremental costs. Hoshizaki
added that manufacturers could help
DOE by reviewing the actual costs
associated with redesigning their
machines to meet the 2010 DOE energy
standards as well as ENERGY STAR
standards. Hoshizaki expressed its
willingness to collaborate with DOE and
AHRI. (Hoshizaki, No. 53 at p. 3)
DOE incorporates the cost of
additional design time, testing, labor,
and tooling into its manufacturer
impacts analysis, as described in section
IV.J. During the NOPR analyses, DOE
and its contractors contacted
manufacturers and obtained related
costs under non-disclosure agreements.
More information on these analyses is
available in section IV.J.
e. Empirical-Based Analysis
In response to comments from
Scotsman and Hoshizaki about the
validity of the energy model, DOE
investigated using an empirical
efficiency level approach for the
engineering analysis rather than the
approach combining energy modeling
and manufacturing cost modeling that
was used in the preliminary analysis.
DOE performed this analysis for eight
batch equipment classes and three
continuous equipment classes. The
alternative approach was to develop the
cost-efficiency curves based on rated or
tested automatic commercial ice makers
energy use levels and costs estimated
using the manufacturing cost model
with updates from manufacturer
discussions, as described in section
IV.D.4.a. To support the empirical
analysis, DOE purchased and tested 20
additional ice makers, giving DOE a
total of 39 ice makers for evaluation.
Table IV.23 shows the resulting costs
for equipment classes that were
analyzed using the empirical approach
and the energy modeling approach. The
incremental cost of reaching a 15
percent below baseline efficiency level
is listed below. In 7 out of 9 equipment
classes, the energy modeling approach
result was far more conservative (i.e.,
resulted in higher incremental cost
estimates) than the empirical approach
result; DOE estimated a negative costefficiency relationship in five of these
cases for the empirical approach.
TABLE IV.23—COMPARISON OF NOPR AND EMPIRICAL ANALYSIS APPROACHES AT THE 15% EFFICIENCY LEVEL
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15% EL
Incremental cost
from empirical
approach
IMH–A–Small–B ...........................................................................................................................................
IMH–A–Large–B ..........................................................................................................................................
IMH–W–Small–B ..........................................................................................................................................
IMH–W–Medium–B ......................................................................................................................................
RCU–NRC–Small–B ....................................................................................................................................
RCU–NRC–Large–B ....................................................................................................................................
SCU–A–Large–B .........................................................................................................................................
SCU–A–Small–B ..........................................................................................................................................
IMH–A–C .....................................................................................................................................................
RCU–NRC–C ...............................................................................................................................................
SCU–A–C ....................................................................................................................................................
$4.88
(32.32)
(102.62)
(543.66)
4.70
166.03
(106.45)
47.41
74.60
(354.91)
(244.80)
* The NOPR analysis did not directly analyze this equipment class.
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15% E
ncremental cost
from NOPR
(energy modeling)
$45.00
39.00
37.00
53.00
* NA
198.00
40.00
32.00
46.00
* NA
28.00
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DOE compared the results of the
empirical analysis and the results of the
energy modeling, and concluded that
the energy modeling results provided a
better and more consistent forecast in
the ability of manufacturers to reach
certain efficiency levels. While the
analyses rigorously account for the cost
differences in key components that
affect energy use, the costs to achieve
higher efficiency levels range from
higher than the NOPR estimates to very
low to negative. DOE is concerned that,
while the calculated cost differences
may accurately reflect actual cost
differences between the chosen pairs of
models, the results may be very
dependent on the details associated
with the specific model selections, and
may vary depending on the units that
are selected. DOE’s empirical analysis
does indicate that the energy modeling
approach does not underestimate the
cost-efficiency steps required to reach
higher efficiencies. DOE believes that
careful calibration of the energy model
combined with reassessment of the cost
model can result in accurate costefficiency curves.
Thus, DOE decided to proceed with
the energy modeling approach as the
main basis for the engineering analysis.
DOE has addressed many of the
stakeholder comments as it updated the
energy modeling analysis. The details of
the energy modeling approach are
described in the next section, section
IV.D.4.f.
Additional details and results of the
empirical analysis are available in
chapter 5 of the NOPR TSD. DOE
believes that the results of the empirical
analyses support the results of DOE’s
design option analysis.
f. Revision of Preliminary Engineering
Analysis
After investigation of and rejection of
an empirical efficiency level analysis
approach, DOE instead developed the
NOPR engineering analysis by updating
the preliminary engineering analysis.
This included making adjustments to
the manufacturing cost model as
described in section IV.D.4.a. It also
included adjustments to energy
modeling.
The design options considered in the
analysis changed, as the discussion of
the updated screening analysis details
in section IV.C.
DOE also made several changes to the
FREEZE energy model used to estimate
energy use of different ice maker design
configurations. To address the concerns
raised by Manitowoc and Howe, DOE
adjusted its energy models based on
input received in manufacturers’ public
and confidential comments and
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discussions DOE’s contractor conducted
under non-disclosure agreements. These
changes included:
• Adjustment of the compressor
coefficients for batch type ice makers;
• using data from tests of ice makers
to model the increase of harvest energy
as condensing temperature decreases for
batch type ice makers;
• developing an approach based on
test data to determine the condensing
temperature reductions associated with
use of larger water-cooled condensers;
• limiting adjustments to the potable
water use of batch products to a
minimum of 20 gallons per 100 lb (or
the starting potable water use level, if
lower)
• incorporating energy use reduction
for drain water heat exchangers used in
batch equipment.
Finally, for the max-tech design
options that extended beyond what was
typically found in commercially
available products (such as permanent
magnet motors and drain water heat
exchangers) that could not be calibrated
against existing units, DOE relied on
testing and literature to properly
account for the energy savings of these
units.
For drain water heat exchangers, DOE
performed testing of a batch type ice
maker with a commercially available
drain water heat exchanger, and used
the test results to calibrate the energy
savings obtained from this technology
for each equipment class where it was
applied.
DOE used motor efficiency ratings
discussed in the preliminary analysis
and verified with stakeholders to scale
the motor use of each component using
permanent magnet motors. During the
NOPR analyses, DOE’s energy model
was calibrated to properly account for
the energy consumption of each
component, and for energy reductions
resulting in jumps to PSC technologies.
Increases in the efficiency of the motor
components can then be expressed as
reductions in the energy consumption of
these components.
DOE calibrated the efficiency gains
calculated by the energy model against
the design options and test results
gathered during the empirical analysis
investigation. DOE used this
comparison to determine the suite of
design options that should be found at
the appropriate high-efficiency level,
and calibrated the results of the energy
against the inspected results.
For example, DOE inspected a pair of
IMH–A–Small–B automatic commercial
ice makers with measured efficiency
levels of 2.2 percent below baseline and
17.5 percent below baseline, and noted
the following changes between units:
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• Increases in both the evaporator
face area and condenser volume, and an
increase in the chassis size to
accommodate these growths,
• an increase in condenser fan size
and a change from an SPM motor to a
PSC motor, and
• an increase in compressor EER.
In the energy model, DOE separated
out each of the different design options
and considered separately, ordering
them in order of cost-efficiency. For this
equipment class, DOE had the following
design options to increase efficiency
from baseline to 23.5 percent below
baseline, as shown in Table IV.24.
TABLE IV.24—IMH–A–SMALL–B
DESIGN OPTIONS
% Below
baseline
Design option
0.00 .............
6.22 .............
Baseline.
Increase compressor EER
from 4.86 EER to 5.25 EER.
Increase condenser width (no
chassis size increase).
Increase Evaporator Area
(with chassis size increase).
Switch to PSC Condenser Fan
Motor.
7.71 .............
20.52 ...........
23.51 ...........
In some instances, DOE considered
slightly different design options,
especially when DOE’s analysis found
that more efficient compressor options
were available. For example, the
maximum compressor EER used in the
energy modeling analysis was more
efficient than the inspected unit
compressor EER. This is the reason this
suite of design options reaches higher
efficiencies. DOE did not consider
chassis sizes larger than those available
on the market.
DOE believes that these changes help
ensure that the energy model results
accurately reflect technology behavior
in the market. Further details on the
analyses are available in chapter 5 of the
NOPR TSD.
E. Markups Analysis
DOE applies multipliers called
‘‘markups’’ to the MSP to calculate the
customer purchase price of the analyzed
equipment. These markups are in
addition to the manufacturer markup
(discussed in section IV.D.4) and are
intended to reflect the cost and profit
margins associated with the distribution
and sales of the equipment between the
manufacturer and customer. DOE
identified three major distribution
channels for automatic commercial ice
makers, and markup values were
calculated for each distribution channel
based on industry financial data. Table
IV.25 shows the three distribution
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channels and the percentage of the
shipments each is assumed to reflect.
The overall markup values were then
calculated by weighted-averaging the
individual markups with market share
values of the distribution channels. See
chapter 6 of the NOPR TSD for more
details on DOE’s methodology for
markups analysis.
TABLE IV.25—DISTRIBUTION CHANNEL MARKET SHARES
National
account
channel:
Manufacturer
direct to
customer
(1-party)
(%)
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Preliminary Analysis ....................................................................................................................
NOPR ...........................................................................................................................................
In general, DOE has found that
markup values vary over a wide range
based on general economic outlook,
manufacturer brand value, inventory
levels, manufacturer rebates to
distributors based on sales volume,
newer versions of the same equipment
model introduced into the market by the
manufacturers, and availability of
cheaper or more technologically
advanced alternatives. Based on market
data, DOE divided distributor costs into
(1) direct cost of equipment sales; (2)
labor expenses; (3) occupancy expenses;
(4) other operating expenses (such as
depreciation, advertising, and
insurance); and (5) profit. DOE assumed
that, for higher efficiency equipment
only, the ‘‘other operating costs’’ and
‘‘profit’’ scale with MSP, while the
remaining costs stay constant
irrespective of equipment efficiency
level. Thus, DOE applied a baseline
markup through which all estimated
distribution costs are collected as part of
the total baseline equipment cost, and
the baseline markups were applied as
multipliers only to the baseline MSP.
Incremental markups were applied as
multipliers only to the MSP increments
(of higher efficiency equipment
compared to baseline) and not to the
entire MSP. Taken together the two
markups are consistent with economic
behavior in a competitive market—the
participants are only able to recover
costs and a reasonable profit level.
DOE received a number of comments
regarding markups after the publication
of the preliminary analysis.
AHRI stated that equipment markups
often result in retail prices that are
lower than what is observed in the
market place, and stated that DOE
should supplement its analysis with a
survey or retail sale prices. (AHRI, No.
49 at pp. 4–5) Scotsman suggested
reviewing equipment pricing on the
internet because many ice makers are
available online. (Scotsman, No. 46 at p.
5)
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Scotsman stated that the national
account chain is not accurate. Scotsman
commented that the national account
distribution chain resembles the
wholesaler distribution chain, because
an equipment supplier is part of the
process. The supplier may contract
directly with the customer but
equipment still goes through another
party, according to Scotsman.
(Scotsman, No. 42 at p. 97) Manitowoc
agreed with Scotsman that the national
accounts chain is misrepresented, and
actually includes a third party to do
installation, repair, and maintenance.
(Manitowoc, No. 42 at pp. 99–100)
Manitowoc stated that mechanical
contractors are typically not part of the
distribution chain. Manitowoc indicated
dealers may in fact provide those
services, but the model is a little
different from the model presented.
(Manitowoc, No. 42 at p. 102–3)
Hoshizaki agreed with the analysis of
distribution channels. (Hoshizaki, No.
53 at p. 2) Manitowoc suggested another
distribution channel exists: rather than
a sale to an end-user, the dealer leases
it to the customer. (Manitowoc, No. 42
at p. 98) Manitowoc was of the opinion
that whether the equipment was sold or
leased to the customer, the end result
would be that the ultimate equipment
price would not be affected.
(Manitowoc, No. 42 at p. 99)
Manitowoc questioned the basic
methodology of using a base and
incremental markup. Manitowoc stated
that if it changed a product, it would
expect the same gross margin on the
incremental cost as on the base.
(Manitowoc, No. 42 at p. 104)
Manitowoc stated that entities in the
distribution chain take the
manufacturer’s list price and add a
markup. Manitowoc stated that by using
the incremental markup, DOE is
understating the impact in the market
place of adding additional costs to raise
the efficiency level, and that is not what
happens in the market, according to
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6
0
Wholesaler
channel:
Manufacturer
to distributor
to customer
(2-party)
(%)
32
38
Contractor
channel:
Contractor
purchase from
distributor for
installation
(3-party)
(%)
62
62
Manitowoc. (Manitowoc, No. 42 at p.
105) Manitowoc stated that the
incremental markup should be the same
as the baseline markup and that it
would be unreasonable to expect that
vendors would earn a lower margin on
additional costs associated with
complying by the increased minimum
efficiency regulations. (Manitowoc, No.
54 at p. 3)
With regard to the AHRI, Scotsman,
and Manitowoc comments related to
retail prices surveys or studies to
determine if DOE was underestimating
prices, DOE performed a market price
survey, reported earlier in the
engineering section IV.D.4.c. Previously
DOE has not performed retail price
surveys, believing that scatter in the
data—particularly when internet and
non-internet prices are co-mingled—
would cause surveys to provide data of
poor value or usefulness. The results of
the retail price survey performed for the
engineering analysis supports this
belief.
With regard to the comment that
mechanical contractors are typically not
part of the distribution chain, DOE is
using mechanical contractor cost
information to model a three-party
distribution channel. Available Census
Bureau data as well as comments
received at the Framework public
meeting indicates that a three-party
distribution channel is common. At
present the mechanical contractor cost
data is the best information available for
quantifying the local contractor portion
of the three-party channel, and DOE
used this data for developing costs
contained in this notice. DOE requests
specific data or data sources to better
categorize the third party costs
attributable to local dealers or
contractors.
The Scotsman and Manitowoc
comments about the national account
chain being misrepresented indicate
that the national account channel is
basically the same as the wholesaler
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channel. Thus, the 6 percent of
shipments initially assigned to the
national account channel will be
combined with the wholesaler channel
shipments and assessed the wholesaler
channel markup. With regard to adding
another channel for leased equipment,
since Manitowoc suggested the pricing
of equipment in such a hypothetical
channel would not differ from other
equipment, DOE elects to not add an
additional channel.
With respect to the comments
questioning the use of an incremental
markup, DOE believes that there is
likely an inaccurate comparison taking
place. In competitive markets, such as
the automatic commercial ice maker
market, the participants are expected to
be able to recover costs and a reasonable
profit, which is what the markups
designed and used by participants
would be expected to do. In the DOE
analysis, the baseline markup has been
calculated to recover all currently
existing overhead expenses with
baseline equipment costs. DOE’s
analysis focuses on changes. Profit
margin and other costs that change as
MSP changes were assigned to
incremental markups. Most overhead
costs were allocated to the base markup
because DOE does not expect these costs
to change because of MSP changes
brought on by efficiency standards. DOE
developed the baseline and incremental
markup methodology to ensure all
overhead costs are fully collected and a
reasonable profit margin is received and
to identify costs that change, and apply
such to the incremental MSP in the form
of incremental markups.
F. Energy Use Analysis
For the preliminary analysis and for
the NOPR, DOE estimated energy usage
for use in the LCC and NIA models
based on the kWh/100 lb ice and gal/
100 lb ice values developed in the
engineering analysis in combination
with other assumptions. In the
preliminary analysis, DOE assumed that
ice makers on average are used to
produce one-half of the ice the
machines could produce (i.e., a 50
percent capacity factor). DOE also
assumed that when not making ice, on
average ice makers would draw 5 watts
of power. DOE modeled condenser
water usage as ‘‘open-loop’’
installations, or installations where
water is used in the condenser one time
(single pass) and released into the
wastewater system.
Several stakeholders agreed with the
50 percent capacity factor being
reasonable. Scotsman stated that the 50
percent utilization factor is relatively
close, given the wide spectrum that
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exists based on seasonality and
installation location. (Scotsman, Public
Meeting Transcript, No. 42 at p. 108)
AHRI stated that on average, across all
applications and seasons, the 50 percent
utilization factor assumed by DOE is
appropriate. (AHRI, No. 49 at p. 5)
Manitowoc agreed that 50 percent
utilization is a good number to use.
(Manitowoc, Public Meeting Transcript,
No. 42 at p. 110) Hoshizaki, on the other
hand, thought 50 percent was on the
low side for the industry, and some
business types, like 24-hour restaurants,
might have much higher usage factors.
(Hoshizaki, Public Meeting Transcript,
No. 42 at p. 111) NPCC expressed a
desire to have information made
available to determine if there is an
equipment class relationship between
the duty cycles and the business type,
and whether duty cycle is related to the
equipment class and/or the product
capacity. NPCC believed that this may
determine whether one is more costeffective to pursue than another. (NPCC,
Public Meeting Transcript, No. 42 at p.
111)
For the NOPR, DOE has continued to
utilize a 50 percent capacity factor, as
most commenters believed it to be a
reasonable number and DOE did not
receive utilization data in the comments
that would lead it to consider
alternative capacity factors in the
analysis. In response to the Hoshizaki
comment and in agreement with the
NPCC comment, DOE requests
additional information about reasonable
values that could be used to vary the
assumption by business type.
Several stakeholders commented on
the assumption of an open-loop
installation for water-cooled
condensers. Scotsman commented that
the majority of ice makers are installed
in open-loop configurations. Scotsman
stated that in some business types like
hotels or casinos, there will typically be
cooling towers and recirculation
systems that the ice maker can tap into.
In smaller locations without that type of
a resource, it would typically be open
loop, according to Scotsman. (Scotsman,
Public Meeting Transcript, No. 42 at pp.
108–109) Scotsman added that singlepass configuration provides a worst-case
energy use, and is appropriate for this
analysis. (Scotsman, No. 46 at p. 3)
Manitowoc stated that it only knows of
installations in casinos or other large
projects where ice makers are installed
on closed loops, and suspects that most
historical installations are open loop.
(Manitowoc, No. 42 at p. 110)
NEEA recommended that DOE
investigate the market share of
automatic commercial ice makers with
single-pass condensers, because they
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use substantially more water than those
with other condenser configurations.
(NEEA, Public Meeting Transcript, No,
42 at pp. 165–166) NPCC stated that
some jurisdictions do not permit openloop installations because of water
usage. (NPCC, Public Meeting
Transcript, No. 42 at pp. 109–110)
Hoshizaki suggested placing watercooled units in closed-loop systems.
(Hoshizaki, No. 42 at p. 110) Hoshizaki
stated that, in certain areas, watercooled condensers could be the most
effective form of condensing.
(Hoshizaki, No. 53 at p. 2)
DOE agrees with Hoshizaki’s
comment that water-cooled condensers
can be a cost-effective form of
condensing. DOE does not envision
promulgating any rule that would
eliminate water-cooled condensers.
Since DOE’s regulatory authority relates
to the efficiency of equipment
manufactured or sold in the U.S. but not
to how equipment is installed or used,
DOE does not plan to promulgate rules
mandating use of closed loops. DOE is
not proposing to perform the research
suggested by NEEA into the prevalence
of open- versus closed-loop
installations. It is always DOE’s
objective to model energy usage as
accurately as possible, so DOE requests
stakeholder assistance in quantifying
the impact of local regulations such as
any local regulation potentially
forbidding an open-loop installation.
Scotsman and Manitowoc stated that,
historically, most installations were
likely open-loop, but the regulations
discussed by NPCC would argue that in
the future such is less likely to be true.
DOE’s analyses to date have not
included design options that would
change condenser water usage, a fact
that means the question of modeling
condenser water in the LCC models
condenser water usage as open- or
closed-loop impacts the absolute value
of life-cycle costs and total national
costs of ownership and operation, but
not LCC savings or increases/decreases
in NPV. Given that Scotsman and
Manitowoc believe that historically
most installations have likely been open
loop, DOE chose to continue to model
water usage as an open-loop (or singlepass) system.
G. Life-Cycle Cost and Payback Period
Analysis
In response to the requirements of
EPCA in (42 U.S.C. 6295(o)(2)(B)(i) and
6313(d)(4)), DOE conducts LCC and PBP
analysis to evaluate the economic
impacts of potential amended energy
conservation standards on individual
commercial customers—that is, buyers
of the equipment. This section describes
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the analyses and the spreadsheet model
DOE used. NOPR TSD chapter 8 details
the model and all the inputs to the LCC
and PBP analyses.
LCC is defined as the total customer
cost over the lifetime of the equipment,
and consists of installed cost (purchase
and installation costs) and operating
costs (maintenance, repair, water,36 and
energy costs). DOE discounts future
operating costs to the time of purchase
and sums them over the expected
lifetime of the unit of equipment. PBP
is defined as the estimated amount of
time it takes customers to recover the
higher installed costs of more-efficient
equipment through savings in operating
costs. DOE calculates the PBP by
dividing the increase in installed costs
by the savings in annual operating costs.
DOE measures the changes in LCC and
in PBP associated with a given energy
and water use standard level relative to
a base-case forecast of equipment energy
and water use (or the ‘‘baseline energy
and water use’’). The base-case forecast
reflects the market in the absence of
new or amended energy conservation
standards.
The installed cost of equipment to a
customer is the sum of the equipment
purchase price and installation costs.
The purchase price includes MPC, to
which a manufacturer markup (which is
assumed to include at least a first level
of outbound freight cost) is applied to
obtain the MSP. This value is calculated
as part of the engineering analysis
(chapter 5 of the NOPR TSD). DOE then
applies additional markups to the
equipment to account for the costs
associated with the distribution
channels for the particular type of
equipment (chapter 6 of the NOPR
TSD). Installation costs are varied by
State depending on the prevailing labor
rates.
Operating costs for automatic
commercial ice makers are the sum of
maintenance costs, repair costs, water,
and energy costs. These costs are
incurred over the life of the equipment
and therefore are discounted to the base
year (2018, which is the proposed
effective date of the amended standards
that will be established as part of this
rulemaking). The sum of the installed
cost and the operating cost, discounted
to reflect the present value, is termed
the life-cycle cost or LCC.
Generally, customers incur higher
installed costs when they purchase
36 Water costs are the total of water and
wastewater costs. Wastewater utilities tend to not
meter customer wastewater flows, and base billings
on water commodity billings. For this reason, water
usage is used as the basis for both water and
wastewater costs, and the two are aggregated in the
LCC and PBP analysis.
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higher efficiency equipment, and these
cost increments will be partially or
wholly offset by savings in the operating
costs over the lifetime of the equipment.
Usually, the savings in operating costs
are due to savings in energy costs
because higher efficiency equipment
uses less energy over the lifetime of the
equipment. Often, the LCC of higher
efficiency equipment is lower compared
to lower-efficiency equipment.
The PBP of higher efficiency
equipment is obtained by dividing the
increase in the installed cost by the
decrease in annual operating cost. For
this calculation, DOE uses the first-year
operating cost decreases as the estimate
of the decrease in operating cost, noting
that some of the repair and maintenance
costs used in the analysis are
annualized estimates of costs. DOE
calculates a PBP for each efficiency
level of each equipment class. In
addition to the energy costs (calculated
using the electricity price forecast for
the first year), the first-year operating
costs also include annualized
maintenance and repair costs.
Apart from MSP, installation costs,
and maintenance and repair costs, other
important inputs for the LCC analysis
are markups and sales tax, equipment
energy consumption, electricity prices
and future price trends, expected
equipment lifetime, and discount rates.
As part of the engineering analysis,
design option levels were ordered based
on increasing efficiency (decreased
energy and water consumption) and
increasing MSP values. DOE developed
four to seven energy use levels for each
equipment class, henceforth referred to
as ‘‘efficiency levels,’’ through the
analysis of engineering design options.
For all equipment classes, efficiency
levels were set at specific intervals—
e.g., 10 percent improvement over base
energy usage, 15 percent improvement,
20 percent improvement. The max-tech
efficiency level is the only exception. At
the max-tech level, the efficiency
improvement matched the specific
levels identified in the engineering
analysis.
The base efficiency level (level 1) in
each equipment class is the least
efficient and the least expensive
equipment in that class. The higher
efficiency levels (level 2 and higher)
exhibit progressive increases in
efficiency and cost with the highest
efficiency level corresponding to the
max-tech level. LCC savings and PBP
are calculated for each selected
efficiency level of each equipment class.
Many inputs for the LCC analysis are
estimated from the best available data in
the market, and in some cases the inputs
are generally accepted values within the
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industry. In general, each input value
has a range of values associated with it.
While single representative values for
each input may yield an output that is
the most probable value for that output,
such an analysis does not give the
general range of values that can be
attributed to a particular output value.
Therefore, DOE carried out the LCC
analysis in the form of Monte Carlo
simulations 37 in which certain inputs
were expressed as a range of values and
probability distributions that account
for the ranges of values that may be
typically associated with the respective
input values. The results or outputs of
the LCC analysis are presented in the
form of mean LCC savings, percentages
of customers experiencing net savings,
net cost and no impact in LCC, and
median PBP. For each equipment class,
10,000 Monte Carlo simulations were
carried out. The simulations were
conducted using Microsoft Excel and
Crystal Ball, a commercially available
Excel add-in used to carry out Monte
Carlo simulations.
LCC savings and PBP are calculated
by comparing the installed costs and
LCC values of standards-case scenarios
against those of base-case scenarios. The
base-case scenario is the scenario in
which equipment is assumed to be
purchased by customers in the absence
of the proposed energy conservation
standards. Standards-case scenarios are
scenarios in which equipment is
assumed to be purchased by customers
after the amended energy conservation
standards, determined as part of the
current rulemaking, go into effect. The
number of standards-case scenarios for
an equipment class is equal to one less
than the total number of efficiency
levels in that equipment class because
each efficiency level above efficiency
level 1 represents a potential amended
standard. Usually, the equipment
available in the market will have a
distribution of efficiencies. Therefore,
for both base-case and standards-case
scenarios, in the LCC analysis, DOE
assumed a distribution of efficiencies in
the market, and the distribution was
assumed to be spread across all
efficiency levels in the LCC analysis (see
NOPR TSD chapter 10).
37 Monte Carlo simulation is, generally, a
computerized mathematical technique that allows
for computation of the outputs from a mathematical
model based on multiple simulations using
different input values. The input values are varied
based on the uncertainties inherent to those inputs.
The combination of the input values of different
inputs is carried out in a random fashion to
simulate the different probable input combinations.
The outputs of the Monte Carlo simulations reflect
the various probable outputs that are possible due
to the uncertainties in the inputs.
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Recognizing that different types of
businesses and industries that use
automatic commercial ice makers face
different energy prices, and apply
different discount rates to purchase
decisions, DOE analyzed variability and
uncertainty in the LCC and PBP results
by performing the LCC and PBP
calculations for seven types of
businesses: (1) Health care; (2) lodging;
(3) foodservice; (4) retail; (5) education;
(6) food sales; and (7) offices. Different
types of businesses face different energy
prices and also exhibit differing
discount rates that they apply to
purchase decisions.
Expected equipment lifetime is
another input for which it is
inappropriate to use a single value for
each equipment class. Therefore, DOE
assumed a distribution of equipment
lifetimes that are defined by Weibull
survival functions.38
Equipment lifetime is a key input for
the LCC and PBP analysis. For
automatic commercial ice maker
equipment, there is a general consensus
among industry stakeholders that the
typical equipment lifetime is
approximately 7 to 10 years with an
average of 8.5 years. There was no data
or comment to suggest that lifetimes are
unique to each equipment class.
Therefore, DOE assumed a distribution
of equipment lifetimes that is defined by
Weibull 39 survival functions, with an
average value of 8.5 years.
Another factor influencing the LCC
analysis is the State in which the
automatic commercial ice maker is
installed. Inputs that vary based on this
factor include installation costs, water
and energy prices, and sales tax (plus
the associated distribution chain
markups). At the national level, the
spreadsheets explicitly modeled
variability in the model inputs for water
price, electricity price, and markups
using probability distributions based on
the relative populations in all States.
Detailed descriptions of the
methodology used for the LCC analysis,
along with a discussion of inputs and
results, are presented in chapter 8 and
appendices 8A and 8B of the NOPR
TSD.
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1. Equipment Cost
To calculate customer equipment
costs, DOE multiplied the MSPs
developed in the engineering analysis
by the distribution channel markups,
described in section IV.E. DOE applied
baseline markups to baseline MSPs and
39 Weibull survival function is a continuous
probability distribution function that is commonly
used to approximate the distribution of equipment
lifetimes.
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incremental markups to the MSP
increments associated with higher
efficiency levels.
In the preliminary analysis, DOE
developed a projection of price trends
for automatic commercial ice maker
equipment, indicating that based on
historical price trends the MSP would
be projected to decline by 0.4 percent
from the 2012 estimation of MSP values
through the 2018 assumed start date of
new or amended standards. The
preliminary analysis also indicated an
approximately 1.6 percent decline from
the MSP values estimated in 2012 to the
end of the 30-year NIA analysis period
used in the preliminary analysis. Price
trends generated considerable
discussion during the LCC presentation
at the February 2012 preliminary
analysis public meeting (and nearly all
comments specific to the NIA were
concerning price trends).
Scotsman stated that it typically sees
some increase in costs and that it tries
to recapture at least some of the
increased cost in the form of price
increases and usually cannot recover all
of it. Scotsman stated that it does not
expect to see prices going down over the
years and does not think it makes a lot
of sense. Scotsman added that for
household refrigerators and other
industries, much of the price decrease
that has been seen over the years is
offshored manufacturing. The automatic
commercial ice maker manufacturers do
not have the scale to consider doing
that, according to Scotsman. (Scotsman,
Public Meeting Transcript, No. 42 at pp.
127–128) Scotsman analyzed the
historical shipments data and provided
graphs showing how different the
forecast would be if a different time
period was selected. Scotsman
suggested that a long-term growth trend
of 1.5 percent is most realistic.
(Scotsman, No. 46 at pp. 6–7)
NRDC stated that price learning is
theoretically expected and empirically
demonstrated, and that it supported
DOE’s incorporation of price learning in
the rulemaking. (NRDC, No. 48 at p. 2)
AHRI urged DOE to assume that price
learning is zero, or in other words, to
hold MSP constant. AHRI stated that it
had performed an analysis of the data
used by DOE and that it believed that
the data did not support an assumption
of price learning greater than zero.
(AHRI, No. 49 at p. 5 and exhibit A)
Manitowoc stated that there is no real
basis to expect that the manufacturing
costs of ice machines will decrease in
the future due to efficiency gains in
production because the ice machine
designs are mature and the
manufacturing processes are stable.
Manitowoc added that the increase in
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costs associated with design options is
only due to higher cost components or
higher cost material employed and that
the annual production volumes do not
allow for further investment in
automation of the manufacturing
processes beyond what is already in
place. (Manitowoc, No. 54 at p. 4)
As is customary between the
preliminary analysis and the NOPR
phases of a rulemaking, DOE reexamined the data available and
updated the analyses, in this specific
instance, the price trend analysis. At a
high level, DOE agrees with the NRDC
comment that evidence indicates price
learning is theoretically expected. In
response to the AHRI, Manitowoc, and
Scotsman comments that the data do not
support the price trends, DOE reexamined the data used in the analysis,
and re-analyzed price trends with
updated data. In the preliminary
analysis, DOE used a Producer Price
Index (PPI) that included airconditioning, refrigeration, and forced
air heating equipment. For the NOPR,
DOE was able to identify a PPI that was
a subset of the PPI used for the
preliminary analysis. The subset
includes only commercial refrigeration
and related equipment, and excludes
unrelated equipment. Using this PPI for
the automatic commercial ice maker
price trends analysis yields a price
decline of roughly 1.6 percent over the
period of 2012 (the year for which MSP
was estimated) through 2047.
2. Installation, Maintenance, and Repair
Costs
a. Installation Costs
Installation cost includes labor,
overhead, and any miscellaneous
materials and parts needed to install the
equipment. The installation costs may
vary from one equipment class to
another, but they typically do not vary
among efficiency levels within an
equipment class. Most automatic
commercial ice makers are installed in
fairly standard configurations. For its
preliminary analysis, DOE tentatively
concluded that the engineering design
options do not impact the installation
cost within an equipment class. DOE
therefore assumed that the installation
cost for automatic commercial ice
makers does not vary among efficiency
levels within an equipment class. Costs
that do not vary with efficiency levels
do not impact the LCC, PBP, or NIA
results. In the preliminary analysis, DOE
estimated the installation cost as a fixed
percentage of the total MSP for the
baseline efficiency level for a given
equipment class, set at 10 percent.
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Manitowoc agreed with DOE’s
assumption that installation costs
generally would be unaffected by
moving to the higher efficiency level.
However, Manitowoc pointed out that
some efficiency differences may cause
variation in installation costs.
Manitowoc further explained that many
remote condensers require a crane for
installation; therefore, bigger condensers
of automatic commercial ice maker
equipment with higher efficiency levels
might result in higher rental and labor
costs associated with the installation.
(Manitowoc, Public Meeting Transcript,
No. 42 at p. 136) In its written
comments to DOE, Manitowoc further
clarified that higher efficiency
equipment would not incur additional
installation costs unless the size of the
equipment increases in such a way as to
exceed the industry norms. (Manitowoc,
No. 54 at p. 4) However, Hoshizaki
indicated installation costs will increase
with higher levels of energy efficiency
due to special installation requirements
for the new machine and possible
changes to the structure that might be
required. Furthermore, AHRI
commented that it is incorrect for DOE
to assume that changes in installation
will be negligible for more-efficient
equipment. (AHRI, No. 49 at p. 5)
Scotsman pointed out that if the
technology were assumed to involve a
drain water heat exchange, the
installation costs would increase.
(Scotsman, No. 46 at p. 3)
In responses to the comments above,
DOE further evaluated the costs
associated with installation and revised
the installation cost estimation methods.
For the NOPR, DOE estimated material
and labor cost to install equipment
based on RS Means cost estimation
data 40 and on telephone conservations
with contractors. Estimated installation
costs vary by equipment class and by
State. DOE decided to continue to
assume installation cost will be constant
for all efficiency levels within an
equipment class.
In response to Manitowoc’s comment
that greater equipment size might result
in higher rental and labor costs, DOE
notes that while the initial decision to
avoid equipment size increases in the
engineering analysis was eliminated,
DOE attempted to minimize equipment
size increases. Thus, proposed standard
levels should not add significantly to
labor and crane rental costs. Nor does
DOE believe the size increases would
require structural changes as
hypothesized by Hoshizaki. In response
to the Manitowoc and Scotsman
40 RS Means Company, Inc. 2013 RS Means
Electrical Cost Data. 2013. Kingston, MA.
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comments about drain water heat
exchanger installation costs, DOE notes
the promotional material of drain water
heat exchanger manufacturers indicate
the units can be installed with four
additional water attachments, a level of
effort that would likely not add to the
cost of installations. Finally, in response
to Hoshizaki’s general statement that
higher efficiency levels will impose
specialized installation requirements, a
review of the design options included in
the DOE engineering analysis did not
reveal any options likely to impose
specific cost increases. To better
respond to the Hoshizaki comment,
DOE requests specificity—which design
options will impose increases in
installation costs and what would the
magnitude of such cost increases be?
b. Repair and Maintenance Costs
The repair cost is the average annual
cost to the customer for replacing or
repairing components in the automatic
commercial ice maker that have failed.
In the preliminary analysis, DOE
approximated the repair cost as a 3percent fixed percentage of the total
baseline MSP for each equipment class
and assumed that repair costs were
constant within an equipment class for
all efficiency levels.
Maintenance costs are associated with
maintaining the proper operation of the
equipment. The maintenance cost does
not include the costs associated with the
replacement or repair of components
that have failed, which are included as
repair costs. In the preliminary analysis,
DOE applied a 3-percent preventative
maintenance cost that remains constant
across all equipment efficiency levels
because data were not available to
indicate how maintenance costs vary
with equipment levels.
Scotsman stated that, in general,
whenever new technology is
introduced, failure rates increase.
Scotsman stated that when the failures
occur during the warranty period, the
cost falls on manufacturers. Ice makers
stress components in ways that they are
not stressed in steady-state machines,
according to Scotsman, so even with
well-known technologies it is not
known how their failure rates will fare
in ice makers. In addition, Scotsman
commented that if the technology was
assumed to involve a drain water heat
exchanger, the maintenance cost would
increase. (Scotsman, No. 46 at pp. 3–4)
Likewise, Hoshizaki stated that repair
costs are relative to each machine and
that it is difficult to compute a standard
average. Manufacturers are still working
to analyze the effects of the 2010
standards on repair costs, according to
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Hoshizaki. (Hoshizaki, No. 46 at pp. 3–
4)
Manitowoc commented that the repair
costs will be affected by the efficiency
levels. Manitowoc stated that is has
specific concerns about some
components such as motors. Manitowoc
pointed out that ECM motors might
enhance the energy efficiencies, but
these motors are probably less reliable
than standard permanent split capacitor
motors because ECM motors have more
parts. Manitowoc further stated that, in
general, more parts increase the chances
that a component will fail, which in
turn potentially increases the repair
costs. (Manitowoc, Public Meeting
Transcript, No. 42 at p. 136) In addition,
Scotsman stated that modeling repair
cost as a percentage of baseline costs
would understate repair cost. Also using
the example of an ECM fan motor,
Scotsman explained that ECM motor has
an incremental cost of $35 to install;
however, when it needs to be replaced,
it is considerably more costly than the
replacement of the motors that are
currently used on the market.
Additionally, Scotsman also noted the
ECM fan motor has more parts than the
current motors that are commonly
applied in the market, making it likely
to fail more often. Therefore, according
to Scotsman, ECM fan motors might
require higher average annual repair
costs than current motors used in the
baseline units. (Scotsman, No. 46 at pp.
3–4) Hoshizaki pointed out higher water
and energy efficiency level may increase
maintenance costs. Hoshizaki elaborated
that equipment with lower water usage
and improved electrical efficiencies
might need more frequent maintenance
such as cleaning. (Hoshizaki, No. 53 at
p. 2)
In addition, Howe commented on the
impact of new standards on repairing
and maintenance costs. Howe stated
that the modification of new ice makers
will cause increased repair and
maintenance costs due to the need to
educate service personnel. The
percentage of the baseline costs will
increase, according to Howe. (Howe, No.
51 at p. 4)
In response to these comments, DOE
evaluated how repair and maintenance
costs were estimated and revised the
methodology. For repair costs, DOE
examined the major components of ice
makers and identified expected failure
rates for each component. For those
components for which available
information indicates a failure might
occur within the expected 8.5-year
equipment life, DOE estimated repair or
replacement costs. Under this
methodology, repair and replacement
costs are based on the original
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equipment costs, so the more expensive
the components are, the greater the
expected repair or replacement cost. For
design options modeled in the
engineering analysis, DOE estimated
repair costs and if they were different
than the baseline cost, the repair costs
were either increased or decreased
accordingly. (Although theoretically
possible, in the case of the ice maker
analysis, repair costs did not decrease
with efficiency levels for any equipment
class.) Thus, consistent with Hoshizaki’s
comment about the difficulty of
estimating one standard average, DOE
now estimates different repair and
replacement costs for all equipment
classes.
DOE’s revision to the repair cost
methodology is consistent with the
Manitowoc, Hoshizaki, Scotsman, and
Howe comments that repair costs
should increase with efficiency level.
Consistent with the Manitowoc and
Scotsman comments, DOE assumed that
ECM fan motors would increase repair
costs relative to the baseline. In
response to Scotsman’s comments about
drain water heat exchangers, DOE notes
that manufacturer literature indicates an
expected useful life greater than 8.5
years, so no replacement was assumed
for this component.
In the NOPR analyses, DOE estimated
material and labor costs for preventative
maintenance based on RS Means cost
estimation data and on telephone
conservations with contractors. DOE
assumed maintenance cost would
remain constant for all efficiency levels
within an equipment class. In response
to Hoshizaki’s comment about the
impact of reduced water usage on
maintenance, the DOE analyses for 7 of
12 primary equipment classes did not
involve changes to water usage. In the
remaining 5 (batch) equipment classes,
DOE’s analysis did not assume potable
water usage would be reduced below 20
gallons per 100 lb ice—a level
manufacturers indicated was a point
below which maintenance costs would
increase. (Scotsman, Public Meeting
Transcript, No. 42 at p. 64; Manitowoc,
Public Meeting Transcript, No. 42 at p.
65) Thus, for the NOPR, DOE assumes
that maintenance costs will not vary by
efficiency level.
3. Annual Energy and Water
Consumption
Chapter 7 of the NOPR TSD details
DOE’s analysis of annual energy and
water usage at various efficiency levels
of automatic commercial ice makers.
Annual energy and water consumption
inputs by automatic commercial ice
maker equipment class are based on the
engineering analysis estimates of
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kilowatt-hours of electricity per 100 lb
ice and gallons of water per 100 lb ice,
translated to annual kilowatt-hours and
gallons in the energy and water use
analysis (chapter 7 of the NOPR TSD).
The development of energy and water
usage inputs is discussed in section
IV.G.6 along with public input and
DOE’s response to the public input.
4. Energy Prices
DOE calculated average commercial
electricity prices using the EIA Form
EIA–826 data obtained online from the
‘‘Database: Sales (consumption),
revenue, prices & customers’’ Web
page.41 The EIA data reports average
commercial sector retail prices
calculated as total revenues from
commercial sales divided by total
commercial energy sales in kilowatthours, by State and for the nation. DOE
received no recommendations or
suggestions regarding this set of
assumptions at the February 2012
preliminary analysis public meeting or
in written comments.
5. Energy Price Projections
To estimate energy prices in future
years for the preliminary analysis TSD,
DOE multiplied the average regional
energy prices described above by the
forecast of annual average commercial
energy price indices developed in the
Reference Case from
AEO2013.42 AEO2013 forecasted prices
through 2040. To estimate the price
trends after 2040, DOE assumed the
same average annual rate of change in
prices as exhibited by the forecast over
the 2031 to 2040 period. DOE received
no recommendations or suggestions
regarding this set of assumptions at the
February 2012 preliminary analysis
public meeting or in written comments.
6. Water Prices
To estimate water prices in future
years for the preliminary analysis TSD,
DOE used price data from the 2008,43
2010,44 and 2012 American Water
Works Water (AWWA) and Wastewater
41 U.S. Energy Information Administration. Sales
and revenue data by state, monthly back to 1990
(Form EIA–826). (Last accessed June 26, 2013).
www.eia.gov/electricity/data.cfm#sales
42 The spreadsheet tool that DOE used to conduct
the LCC and PBP analyses allows users to select
price forecasts from either AEO’s High Economic
Growth or Low Economic Growth Cases. Users can
thereby estimate the sensitivity of the LCC and PBP
results to different energy price forecasts.
43 American Water Works Association. 2008
Water and Wastewater Rate Survey. 2009. Denver,
CO. Report No. 54004.
44 American Water Works Association. 2010
Water and Wastewater Rate Survey. 2011. Denver,
CO. Report No. 54006.
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14895
Surveys.45 The AWWA 2012 survey was
the primary data set. No data exists to
disaggregate water prices for individual
business types, so DOE varied prices by
state only and not by business type
within a state. For each state, DOE
combined all individual utility
observations within the state to develop
one value for each state for water and
wastewater service. Since water and
wastewater billings are frequently tied
to the same metered commodity values,
DOE combined the prices for water and
wastewater into one total dollars per
1,000 gallons figure. DOE used the
Consumer Price Index (CPI) data for
water-related consumption (1973–
2012) 46 in developing a real growth rate
for water and wastewater price
forecasts.
During the public meeting and in
written comments, stakeholders
commented on the water prices DOE
used in its LCC analysis. NPCC stated
that water and wastewater price
escalation has been systematically
higher than the CPI. Further, NPCC
pointed out that EPA’s water-related
regulations governed by the Clean Water
Act might level out the escalation rates
once the regulations’ requirements were
satisfied, even though NPCC does not
anticipate the escalation rates will
diminish much. Given the impact of
EPA’s latest water-related regulations
was not completed, NPCC then raised
the question whether DOE should use
both a higher escalation rate and CPI in
its analysis. NPCC then suggested using
a higher escalated rate in the analysis
for a short-run period until the effective
date of EPA’s latest water-related
regulations and move to the CPI for the
longer term analysis starting with the
effective date of EPA’s relevant
regulations. (NPCC, Public Meeting
Transcript, No, 42 at pp. 132–134) In
addition, the Alliance argued that water
use and energy use cannot be compared
on a simple price basis because of key
differences between the two resources.
The Alliance stated that, first, energy
comes from multiple sources and is a
commodity whose prices fluctuate
based on supply and demand.
Freshwater, on the other hand, is in
limited supply and water prices are
heavily regulated based on the cost of
treatment and delivery, which is less
directly affected by supply and demand,
according to the Alliance. The Alliance
45 American Water Works Association. 2012
Water and Wastewater Rate Survey. 2013. Denver,
CO. Report No. 54008.
46 The Bureau of Labor Statistics defines CPI as
a measure of the average change over time in the
prices paid by urban consumers for a market basket
of consumer goods and services. For more
information see www.bls.gov/cpi/home.htm.
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further stated that when water demand
overcomes the readily available fresh
water resources in the U.S., the
alternative water sources will likely
require more costly infrastructure and
operational changes such as
desalination to fulfill the demand for
fresh water, which is also a very energy
intensive process. Therefore, the
Alliance recommended that DOE
consider the marginal costs of
alternative water sources, such as
desalination, in its analyses to properly
account for all water costs as applied to
water-cooled condensers. (Alliance, No.
45 at p. 4)
DOE appreciates the comments that
EPA water regulations under the Clean
Water Act may impact the escalation
rate of water price used in DOE’s
analysis and the observation about
desalination plants being the next
source of water available in many
localities. With respect to the Clean
Water Act comment, DOE notes that the
Clean Water Act has been in existence
since 1972. Thus, the water price trends
should include the impacts of historical
costs attributable to the Clean Water
Act. Throughout that entire period, the
CPI for water utility costs grew at an
average rate of 1.6 percent faster than
the total CPI, perhaps validating the
NPCC point. As for capturing the effects
of unknown future EPA regulations,
DOE considers this a speculative effort,
and DOE has long adhered to a guiding
principle that the analyses avoid
speculating in this fashion. With respect
to the comment about desalination and
the accompanying suggestion that DOE
should use marginal water prices, DOE
has developed water prices using recent
water price data, which would include
resource costs that underlie the
provision of water. Looking forward,
DOE acknowledges that new water
resources brought online in future years
may differ from those of the past, but
DOE has not identified a source that
carefully and systematically forecasts
the impact of future developments of
this nature, as the AEO2013 does in the
case of electricity. Thus, to attempt to
project growth rates for 50 states to
capture these resource changes would
be speculative. Rather than speculate,
DOE has updated the calculation of
State-level water prices with the
inclusion of the 2012 AWWA survey 47
and additional consumer price index
values.
47 American Water Works Association. 2012
Water and Wastewater Rate Survey. 2013. Denver,
CO. Report No. 54008.
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7. Discount Rates
The discount rate is the rate at which
future expenditures are discounted to
establish their present value. DOE
determined the discount rate by
estimating the cost of capital for
purchasers of automatic commercial ice
makers. Most purchasers use both debt
and equity capital to fund investments.
Therefore, for most purchasers, the
discount rate is the weighted average
cost of debt and equity financing, or the
weighted average cost of capital
(WACC), less the expected inflation.
To estimate the WACC of automatic
commercial ice maker purchasers, DOE
used a sample of nearly 1,200
companies grouped to be representative
of operators of each of the commercial
business types (health care, lodging,
foodservice, retail, education, food
sales, and offices) drawn from a
database of 6,177 U.S. companies
presented on the Damodaran Online
Web site.48 This database includes most
of the publicly-traded companies in the
United States. The WACC approach for
determining discount rates accounts for
the current tax status of individual firms
on an overall corporate basis. DOE did
not evaluate the marginal effects of
increased costs, and, thus, depreciation
due to more expensive equipment, on
the overall tax status.
DOE used the final sample of
companies to represent purchasers of
automatic commercial ice makers. For
each company in the sample, DOE
combined company-specific information
from the Damodaran Online Web site,
long-term returns on the Standard &
Poor’s 500 stock market index from the
Damodaran Online Web site, nominal
long-term Federal government bond
rates, and long-term inflation to estimate
a WACC for each firm in the sample.
For most educational buildings and a
portion of the office buildings and
cafeterias occupied and/or operated by
public schools, universities, and State
and local government agencies, DOE
estimated the cost of capital based on a
40-year geometric mean of an index of
long-term tax-exempt municipal bonds
(≤20 years).49 50 Federal office space was
assumed to use the Federal bond rate,
derived as the 40-year geometric average
48 Damodaran financial data is available at:
https://pages.stern.nyu.edu/∼adamodar/ (Last
accessed January 31, 2013).
49 Federal Reserve Bank of St. Louis, State and
Local Bonds—Bond Buyer Go 20-Bond Municipal
Bond Index. (Last accessed April 6, 2012). Annual
data for 1973–2011 was available at: https://
research.stlouisfed.org/fred2/series/MSLB20/
downloaddata?cid=32995).
50 Rate for 2012 calculated from monthly data.
Data source: U.S. Federal Reserve (Last accessed
February 20, 2013) (Available at:
www.federalreserve.gov/releases/h15/data.htm).
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of long-term (≤10 years) U.S.
government securities.51
DOE recognizes that within the
business types purchasing automatic
commercial ice makers there will be
small businesses with limited access to
capital markets. Such businesses tend to
be viewed as higher risk by lenders and
face higher capital costs as a result. To
account for this, DOE included an
additional risk premium for small
businesses. The premium, 1.9 percent,
was developed from information found
on the Small Business Administration
Web site.52
Chapter 8 of the TSD provides more
information on the derivation of
discount rates. The average discount
rate by business type is shown on Table
IV.26.
TABLE IV.26—AVERAGE DISCOUNT
RATE BY BUSINESS TYPE
Business type
Health Care ........................
Lodging ...............................
Foodservice ........................
Retail ...................................
Education ............................
Food Sales .........................
Office ..................................
Average discount rate (real)
(%)
2.7
6.8
5.8
4.6
3.0
5.1
4.6
8. Lifetime
DOE defines lifetime as the age at
which typical automatic commercial ice
maker equipment is retired from service.
DOE estimated equipment lifetime
based on its discussion with industry
experts, and concluded a typical
lifetime of 8.5 years. AHRI agreed with
DOE’s proposed average equipment
lifetime of 8.5 years. (Alliance, No. 49
at p. 5) Hoshizaki agreed that 8.5 years
is a fair assumption for commercial cube
type ice makers. However, Hoshizaki
stated that continuous type ice makers
might have a shorter life. (Hoshizaki,
No. 53 at p. 2)
For the NOPR analyses, DOE elected
to use an 8.5-year average life for all
equipment classes. With regard to the
Hoshizaki statement that continuous
type ice makers might have shorter life
spans, DOE requests specific
information to assist in determining
whether continuous and batch type
equipment should be analyzed using
differing assumptions for equipment
51 Rate calculated with 1973–2012 data. Data
source: U.S. Federal Reserve (Last accessed
February 20, 2013) (Available at:
www.federalreserve.gov/releases/h15/data.htm).
52 Small Business Administration data on loans
between $10,000 and $99,000 compared to AAA
Corporate Rates. Data last accessed on June 10, 2013.
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life. All literature on the subject of ice
maker lifetimes reviewed by DOE,
including comments received during the
Framework phase of this rulemaking,
indicates a 7 to 10 year life, with 8.5
years being a reasonable average. DOE
therefore is proposing in this NOPR to
use 8.5 years as automatic commercial
ice maker lifetime for DOE’s LCC
analysis for covered automatic
commercial ice maker equipment, but
would welcome additional data
concerning specific differences between
equipment classes.
9. Compliance Date of Standards
EPCA prescribes that DOE must
review and determine whether to amend
performance-based standards for cube
type automatic commercial ice makers
by January 1, 2015. (42 U.S.C.
6313(d)(3)(A)) In addition, EPCA
requires that the amended standards
established in this rulemaking must
apply to equipment that is
manufactured on or after 3 years after
the final rule is published in the Federal
Register unless DOE determines, by
rule, that a 3-year period is inadequate,
in which case DOE may extend the
compliance date for that standard by an
additional 2 years. (42 U.S.C.
6313(d)(3)(C)) DOE began this
rulemaking with the expectation of
completing it prior to the January 1,
2015 required date, and, therefore,
assumed during the preliminary
analysis that new and amended
standards would take effect in 2016.
However, for the NOPR analyses, based
on the January 1, 2015 statutory
deadline and giving manufacturers 3
years to meet the new and amended
standards, DOE assumes that the most
likely compliance date for the standards
set by this rulemaking would be January
1, 2018. Therefore, DOE calculated the
LCC and PBP for automatic commercial
ice makers under the assumption that
compliant equipment would be
purchased in 2018, the year when
compliance with the amended standard
is required. DOE requests comments on
the January 1, 2018 effective date.
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10. Base-Case and Standards-Case
Efficiency Distributions
To estimate the share of affected
customers who would likely be
impacted by a standard at a particular
efficiency level, DOE’s LCC analysis
considers the projected distribution of
efficiencies of equipment that customers
purchase under the base case (that is,
the case without new energy efficiency
standards). DOE refers to this
distribution of equipment efficiencies as
a base-case efficiency distribution.
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DOE’s methodology to estimate
market shares of each efficiency level
within each equipment class is based on
an analysis of the automatic commercial
ice makers currently available for
purchase by customers. DOE analyzed
all available models, calculated the
percentage difference between the
baseline energy usage embodied in the
ice maker rulemaking analyses, and
organized the available units by the
efficiency levels. DOE then calculated
the percentage of available models
falling within each efficiency level bin.
This efficiency distribution was used in
the LCC and other downstream analyses
as the baseline efficiency distribution.
11. Inputs to Payback Period Analysis
Payback period is the amount of time
it takes the customer to recover the
higher purchase cost of more energyefficient equipment as a result of lower
operating costs. Numerically, the PBP is
the ratio of the increase in purchase cost
to the decrease in annual operating
expenditures. This type of calculation is
known as a ‘‘simple’’ PBP because it
does not take into account changes in
operating cost over time (i.e., as a result
of changing cost of electricity) or the
time value of money; that is, the
calculation is done at an effective
discount rate of zero percent. PBPs are
expressed in years. PBPs greater than
the life of the equipment mean that the
increased total installed cost of the
more-efficient equipment is not
recovered in reduced operating costs
over the life of the equipment, given the
conditions specified within the analysis
such as electricity prices.
The inputs to the PBP calculation are
the total installed cost to the customer
of the equipment for each efficiency
level and the average annual operating
expenditures for each efficiency level in
the first year. The PBP calculation uses
the same inputs as the LCC analysis,
except that discount rates are not used.
12. Rebuttable Presumption Payback
Period
EPCA (42 U.S.C. 6295(o)(2)(B)(iii) and
6313(d)(4)) established a rebuttable
presumption that a new or amended
standards are economically justified if
the Secretary finds that the additional
cost to the consumer of purchasing a
product complying with an energy
conservation standard level will be less
than three times the value of the energy
savings during the first year that the
consumer will receive as a result of the
standard, as calculated under the
applicable test procedure.
While DOE examined the rebuttable
presumption criterion, it considered
whether the standard levels considered
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are economically justified through a
more detailed analysis of the economic
impacts of these levels pursuant to 42
U.S.C. 6295(o)(2)(B)(iii) 6313(d)(4). The
results of this analysis served as the
basis for DOE to evaluate the economic
justification for a potential standard
level definitively (thereby supporting or
rebutting the results of any preliminary
determination of economic
justification).
H. National Impact Analysis—National
Energy Savings and Net Present Value
The NIA assesses the NES and the
NPV of total customer costs and savings
that would be expected as a result of the
amended energy conservation
standards. The NES and NPV are
analyzed at specific efficiency levels
(i.e., TSL) for each equipment class of
automatic commercial ice makers. DOE
calculates the NES and NPV based on
projections of annual equipment
shipments, along with the annual
energy consumption and total installed
cost data from the LCC analysis. For the
NOPR analysis, DOE forecasted the
energy savings, operating cost savings,
equipment costs, and NPV of customer
benefits for equipment sold from 2018
through 2047—the year in which the
last standards-compliant equipment is
shipped during the 30-year analysis.
DOE evaluates the impacts of the
amended standards by comparing basecase projections with standards-case
projections. The base-case projections
characterize energy use and customer
costs for each equipment class in the
absence of any amended energy
conservation standards. DOE compares
these base-case projections with
projections characterizing the market for
each equipment class if DOE adopted
the amended standards at each TSL. For
the standards cases, DOE assumed a
‘‘roll-up’’ scenario in which equipment
at efficiency levels that do not meet the
standard level under consideration
would ‘‘roll up’’ to the efficiency level
that just meets the proposed standard
level, and equipment already being
purchased at efficiency levels at or
above the proposed standard level
would remain unaffected.
DOE uses a Microsoft Excel
spreadsheet model to calculate the
energy savings and the national
customer costs and savings from each
TSL. The NOPR TSD and other
documentation that DOE provides
during the rulemaking help explain the
models and how to use them, and
interested parties can review DOE’s
analyses by interacting with these
spreadsheets. The NIA spreadsheet
model uses average values as inputs (as
opposed to probability distributions of
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key input parameters from a set of
possible values).
For the current analysis, the NIA used
projections of energy prices and
commercial building starts from the
AEO2013 Reference Case. In addition,
DOE analyzed scenarios that used
inputs from the AEO2013 Low
Economic Growth and High Economic
Growth Cases. These cases have lower
and higher energy price trends,
respectively, compared to the Reference
Case. NIA results based on these cases
are presented in chapter 10 of the NOPR
TSD.
A detailed description of the
procedure to calculate NES and NPV,
and inputs for this analysis, are
provided in chapter 10 of the NOPR
TSD.
1. Shipments
DOE obtained data from AHRI and
U.S. Census Bureau’s Current Industrial
Reports (CIR) to estimate historical
shipments for automatic commercial ice
makers. AHRI provided DOE with
automatic commercial ice maker
shipment data for 2010 describing the
distribution of shipments by equipment
class and by harvest capacity. AHRI’s
data to DOE also included a 11-year
history of total shipments from 2000 to
2010. Additionally, DOE collected total
automatic commercial ice maker
shipment data for the period of 1973 to
2009 from the CIR. DOE reviewed the
total shipments in the AHRI and CIR
data, and noted that the CIR-reported
shipments were consistently higher than
the AHRI-reported shipments. DOE
considered the possibility that these
discrepancies were associated with net
exports. However, the CIR data
presented exports as a percentage of
total production at a high level of
industry aggregation, thus making it
impossible to identify ice maker exports
as a percentage of ice maker production.
DOE requested input to aid in
understanding the differences between
the AHRI and CIR shipments data. DOE
identified one source with identifiable
export information, the North American
Association of Food Equipment
Manufacturers (NAFEM). NAFEM data
for two recent calendar years (2007 and
2008) showed approximately 20 percent
of total ice maker shipments associated
with food service equipment as exports.
Applying a 20 percent export factor to
the CIR shipments data brought the CIR
data into approximate agreement with
the AHRI data.
For the preliminary analysis, DOE
relied on the CIR shipment values,
reduced 20 percent for exports. Using
adjusted CIR data, DOE created a rolling
estimate of total existing stock by
aggregating historical shipments across
8.5-year historical periods. DOE used
the CIR data to estimate a time series of
shipments and total stock for 1994 to
2006—at the time of the analysis, the
last year of data available without
significant gaps in the data due to
disclosure limitations. For each year,
using shipments, stock, and the
estimated 8.5-year life of the equipment,
DOE estimated that, on average, 14
percent of shipments were for new
installations and the remainder for
replacement of existing stock.
DOE then combined the historical
shipments, disaggregated between
shipments for new installations and
those for replacement of existing stock,
and the historical stock values with
projections of new construction activity
from AEO2011 to generate a forecast of
shipments. Stock and shipments were
first disaggregated to individual
business types based on data developed
for DOE on commercial ice maker
stocks.53 The business types and share
of stock represented by each type are
shown in Table IV.27. Using a Weibull
distribution assuming equipment has an
average life of 8.5 years and lasts from
5 to 11 years, DOE developed a 30-year
series of replacement ice maker
shipments. Using the base shipments to
new equipment, and year-to-year
changes in new commercial sector floor
space additions from AEO2011, DOE
estimated shipments for new
construction. (For the NOPR, DOE is
using AEO2013 projections of floor
space additions. The AEO2013 floor
space additions by building type are
shown in Table IV.28.) The combination
of the replacement and new
construction shipments yields total
shipments. The final step was to
distribute total sales to equipment
classes by multiplying the total
shipments by percentage shares by
class. Table IV.29 shows the percentages
represented by all equipment classes,
both the primary classes modeled
explicitly in all NOPR analyses as well
as the secondary classes.
TABLE IV.27—BUSINESS TYPES
INCLUDED IN SHIPMENTS ANALYSIS
Building type as
percent of stock
(%)
Building type
Health Care ........................
Lodging ...............................
Foodservice ........................
Retail ...................................
Education ............................
Food Sales .........................
Office ..................................
9
33
22
8
7
16
4
Total .............................
100
TABLE IV.28—AEO2013 FORECAST OF NEW BUILDING SQUARE FOOTAGE
New construction
million ft 2
Year
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Health care
2013 .............................
2018 .............................
2020 .............................
2025 .............................
2030 .............................
2035 .............................
2040 .............................
Annual Growth Factor,
2031–2040 ................
Lodging
19:08 Mar 14, 2014
Retail
Education
Food sales
Office
66
67
65
63
71
73
76
147
164
178
181
150
207
190
30
50
48
48
54
56
56
276
424
407
442
508
522
562
247
208
197
169
191
228
252
21
35
33
33
38
39
39
173
409
452
392
273
412
405
2.4%
2.5%
2.4%
2.5%
1.7%
2.3%
2.1%
53 Navigant Consulting, Inc. Energy Savings
Potential and R&D Opportunities for Commercial
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TABLE IV.29—PERCENT OF SHIPPED manufacturers report to the Census
UNITS OF AUTOMATIC COMMERCIAL Bureau. AHRI stated that some
residential ice makers may be lumped
ICE MAKERS
Percentage of
shipments
Equipment class
IMH–W–Small–B ..................
IMH–W–Med–B ....................
IMH–W–Large–B ..................
IMH–A–Small–B ...................
IMH–A–Large–B ...................
RCU–Small–B .......................
RCU–RC/NC–Large–B .........
SCU–W–Small–B .................
SCU–W–Large–B .................
SCU–A–Small–B ..................
SCU–A–Large–B ..................
IMH–W–Small–C ..................
IMH–W–Large–C ..................
IMH–A–Small–C ...................
IMH–A–Large–C ...................
RCU–Small–C ......................
RCU–Large–C ......................
SCU–W–Small–C .................
SCU–W–Large–C .................
SCU–A–Small–C ..................
SCU–A–Large–C ..................
4.54
2.90
0.48
27.08
16.14
5.43
6.08
0.68
0.22
13.85
6.56
0.68
0.17
3.53
1.07
0.83
0.87
0.15
0.00
8.75
0.00
Total ...............................
100.00
Source: AHRI, 2010 Shipments data submitted to DOE as part of this rulemaking.
Comments related to shipment
analysis received during the February
2012 preliminary analysis public
meeting are listed below along with
DOE’s responses to the comments.
AHRI, in response to DOE’s question
about inconsistencies between AHRI
and CIR data, indicated it has found
discrepancies and that these
discrepancies relate to the way
into the Census Bureau data. AHRI
stated that it is confident in its data and
would trust it as compared to the
Census Bureau data. (AHRI, Public
Meeting Transcript, No. 42 at p. 155)
AHRI commented that it believes the
historical shipments numbers it
provided to DOE are more consistent in
terms of product definitions and other
factors than the Census Bureau
shipments. (AHRI, No. 49 at p. 6) In
response to a question by NPCC,
Manitowoc indicated that while the
automatic commercial ice makers
market was still a little below historical
levels, it was recovered from 2009.
Manitowoc stated the product mix
calculated by DOE is a ‘‘pretty good’’
snapshot, but there are shifts over time
between batch and continuous types.
(Manitowoc, Public Meeting Transcript,
No. 42 at p. 147) Howe recommended
using the Census Bureau shipments data
because it is more encompassing.
(Howe, No. 51 at p. 4) Hoshizaki stated
AHRI shipment data could be skewed
by models not sold in AHRI model class
or manufacturers that do not participate
with AHRI, but more information is
needed to evaluate this issue.
(Hoshizaki, No. 53 at p. 2)
In response to AHRI’s comments
about the known consistency of the
AHRI data versus the less-well-known
consistency of the Census Bureau data,
DOE elected to use the AHRI historical
data for the DOE Reference Case
14899
projections. As noted by Howe and
Hoshizaki, the Census Bureau data
could reflect broader coverage of all
manufacturers. Thus, DOE configured
the NIA model such that consistent
scenarios can be modeled with either
AHRI or Census Bureau data. With
respect to the Manitowoc comments,
DOE appreciates that the product mix
represents a good snapshot. With
respect to changing the mix, DOE
requests additional data concerning
trends, in the absence of which, DOE
will by necessity hold the product mix
static in the forecast.
2. Forecasted Efficiency in the Base Case
and Standards Cases
The method for estimating the market
share distribution of efficiency levels is
presented in section IV.G.10, and a
detailed description can be found in
chapter 10 of the NOPR TSD. To
estimate efficiency trends in the
standards cases, DOE uses a ‘‘roll-up’’
scenario in its standards rulemakings.
Under the roll-up scenario, DOE
assumes that equipment efficiencies in
the base case that do not meet the
standard level under consideration
would ‘‘roll up’’ to the efficiency level
that just meets the proposed standard
level and equipment already being
purchased at efficiencies at or above the
standard level under consideration
would be unaffected. Table IV.30 shows
the shipment-weighted market shares by
efficiency level in the base-case
scenario.
TABLE IV.30—SHIPMENT-WEIGHTED MARKET SHARES BY EFFICIENCY LEVEL, BASE CASE
Market share by efficiency level
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Equipment class
Level 1
(%)
IMH–W–Small–B ..........
IMH–W–Med–B ............
IMH–W–Large–B
IMH–W–Large–B–1
IMH–W–Large–B–2
IMH–A–Small–B ...........
IMH–A–Large–B
IMH–A–Large–B–1
IMH–A–Large–B–2
RCU–Large–B
RCU–Large–B–1 ...
RCU–Large–B–2 ...
SCU–W–Large–B .........
SCU–A–Small–B ..........
SCU–A–Large–B ..........
IMH–A–Small–C ...........
IMH–A–Large–C ..........
SCU–A–Small–C ..........
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Level 2
(%)
Level 3
(%)
Level 4
(%)
Level 5
(%)
Level 6
(%)
Level 7
(%)
39.1
69.0
26.1
16.7
23.9
11.9
10.9
0.0
0.0
2.4
0.0
........................
........................
........................
71.4
33.3
37.0
0.0
50.0
31.5
4.8
0.0
25.9
23.8
16.7
5.6
........................
........................
0.0
........................
........................
0.0
........................
........................
0.0
41.5
33.3
43.9
26.7
7.3
26.7
7.3
13.3
0.0
........................
0.0
........................
........................
........................
42.9
27.3
28.6
17.1
28.6
22.9
35.0
26.7
39.3
45.5
0.0
40.0
35.7
22.9
20.0
20.0
8.9
9.1
14.3
5.7
0.0
14.3
15.0
16.7
0.0
0.0
0.0
11.4
7.1
8.6
15.0
13.3
8.9
18.2
42.9
14.3
21.4
17.1
0.0
3.3
........................
........................
0.0
11.4
7.1
2.9
5.0
20.0
........................
........................
14.3
0.0
0.0
11.4
10.0
........................
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3. National Energy Savings
For each year in the forecast period,
DOE calculates the NES for each TSL by
multiplying the stock of equipment
affected by the energy conservation
standards by the estimated per-unit
annual energy savings. DOE typically
considers the impact of a rebound effect,
introduced in the energy use analysis, in
its calculation of NES for a given
product. A rebound effect occurs when
users operate higher efficiency
equipment more frequently and/or for
longer durations, thus offsetting
estimated energy savings. When a
rebound effect occurs, it is generally
because the users of the equipment
perceive it as less costly to use the
equipment and elect to use it more
intensively. In the case of automatic
commercial ice makers, users of the
equipment include restaurant wait staff,
hotel guests, cafeteria patrons, or
hospital staff using ice in the treatment
of patients. Users of automatic
commercial ice makers tend to have no
perception of the cost of the ice, and
rather are using the ice to serve a
specific need. Given this, DOE believes
there is no potential for a rebound
effect. For the preliminary analysis,
DOE used a rebound factor of 1, or no
effect, for automatic commercial ice
makers.
Inputs to the calculation of NES are
annual unit energy consumption,
shipments, equipment stock, and a siteto-source conversion factor.
The annual unit energy consumption
is the site energy consumed by an
automatic commercial ice maker unit in
a given year. Using the efficiency of
units at each efficiency level and the
baseline efficiency distribution, DOE
determined annual forecasted shipmentweighted average equipment efficiencies
that, in turn, enabled determination of
shipment-weighted annual energy
consumption values.
The automatic commercial ice makers
stock in a given year is the total number
of automatic commercial ice makers
shipped from earlier years (up to 12
years earlier) that remain in use in that
year. The NES spreadsheet model keeps
track of the total units shipped each
year. For purposes of the NES and NPV
analyses in the NOPR analysis, DOE
assumed that, based on an 8.5-year
average equipment lifetimes,
approximately 12 percent of the existing
automatic commercial ice makers are
retired and replaced in each year. DOE
assumes that, for units shipped in 2047,
any units still remaining at the end of
2055 will be replaced.
DOE uses a multiplicative factor
called ‘‘site-to-source conversion factor’’
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to convert site energy consumption (at
the commercial building) into primary
or source energy consumption (the
energy at the energy generation site
required to convert and deliver the site
energy). These site-to-source conversion
factors account for the energy used at
power plants to generate electricity and
losses in transmission and distribution,
as well as for natural gas losses from
pipeline leakage and energy used for
pumping. For electricity, the conversion
factors vary over time due to projected
changes in generation sources (that is,
the power plant types projected to
provide electricity to the country). The
factors that DOE developed are marginal
values, which represent the response of
the system to an incremental decrease in
consumption associated with amended
energy conservation standards.
In the preliminary analysis, DOE used
annual site-to-source conversion factors
based on the version of the National
Energy Modeling System (NEMS) that
corresponds to AEO2008.54 For today’s
NOPR, DOE updated its conversion
factors based on the U.S. energy sector
modeling using the NEMS Building
Technologies (NEMS–BT) version that
corresponds to AEO2013 and which
provides national energy forecasts
through 2040. Within the results of
NEMS–BT model runs performed by
DOE, a site-to-source ratio for
commercial refrigeration was
developed. The site-to-source ratio was
extended beyond 2040 by using growth
rates calculated at 5-year intervals to
extrapolate the trend to 2045, after
which it was held constant through the
end of the analysis period (30-years plus
the life of equipment).
DOE has historically presented NES
in terms of primary energy savings. In
response to the recommendations of a
committee on ‘‘Point-of-Use and FullFuel-Cycle Measurement Approaches to
Energy Efficiency Standards’’ appointed
by the National Academy of Science,
DOE announced its intention to use fullfuel-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 (August 18,
2011) 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
54 In the past for preliminary analysis estimates,
DOE typically did not perform analyses using
NEMS. Rather, DOE relied on existing estimates
considered appropriate for the analysis. The site-tosource values DOE considered most appropriate
were those used in the prior 2009 commercial
refrigeration equipment rulemaking final rule.
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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 a statement
of amended policy in the Federal
Register in which DOE explained its
determination that NEMS is a more
appropriate tool for its FFC analysis and
its intention to use NEMS for that
purpose. 77 FR 49701 (August 17, 2012).
DOE received one comment, which was
supportive of the use of NEMS for
DOE’s FFC analysis.55
The approach used for today’s NOPR,
and the FFC multipliers that were
applied are described in appendix 10D
of the NOPR TSD. NES results are
presented in both primary and in terms
of FFC savings; the savings by TSL are
summarized in terms of FFC savings in
section V.B.3.
4. Net Present Value of Customer
Benefit
The inputs for determining the NPV
of the total costs and benefits
experienced by customers of the
automatic commercial ice makers are:
(1) total annual installed cost; (2) total
annual savings in operating costs; and
(3) a discount factor. DOE calculated net
national savings for each year as the
difference in installation and operating
costs between the base-case scenario
and standards-case scenarios. DOE
calculated operating cost savings over
the life of each piece of equipment
shipped in the forecast period.
DOE multiplied monetary values in
future years by the discount factor to
determine the present value of costs and
savings. DOE estimated national
impacts with both a 3-percent and a 7percent real discount rate as the average
real rate of return on private investment
in the U.S. economy. These discount
rates are used in accordance with the
Office of Management and Budget
(OMB) guidance to Federal agencies on
the development of regulatory analysis
(OMB Circular A–4, September 17,
2003), and section E, ‘‘Identifying and
Measuring Benefits and Costs,’’ therein.
DOE defined the present year as 2013
for the NOPR analysis. The 7-percent
real value is an estimate of the average
before-tax rate of return to private
capital in the U.S. economy. The 3percent real value represents the
‘‘societal rate of time preference,’’ which
is the rate at which society discounts
future consumption flows to their
present.
As discussed in IV.G.1, DOE included
a projection of price trends in the
55 Docket ID: EERE–2010–BT–NOA0028,
comment by Kirk Lundblade.
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preliminary analysis NIA. For the
NOPR, DOE reviewed and updated the
analysis with the result that the
projected reference case downward
trend in prices is quite modest. For the
NOPR, DOE also developed high and
low case price trend projections, as
discussed in a NOPR TSD appendix to
chapter 10.
I. Customer Subgroup Analysis
In analyzing the potential impact of
new or amended standards on
commercial customers, DOE evaluates
the impact on identifiable groups (i.e.,
subgroups) of customers, such as
different types of businesses that may be
disproportionately affected. Based on
the data available to DOE, automatic
commercial ice maker ownership in
three building types represent over 70
percent of the market: food sales,
foodservice, and hotels. Based on data
from the 2007 U.S. Economic Census
and size standards set by the U.S. Small
Business Administration (SBA), DOE
determined that a majority of food sales,
foodservice and lodging firms fall under
the definition of small businesses. Small
businesses typically face a higher cost of
capital. In general, the lower the cost of
electricity and higher the cost of capital,
the more likely it is that an entity would
be disadvantaged by the requirement to
purchase higher efficiency equipment.
Chapter 8 of the NOPR TSD presents the
electricity price by business type and
discount rates by building types,
respectively, while chapter 11 discusses
these topics as they specifically relate to
small businesses.
Comparing the foodservice, food
sales, and lodging categories,
foodservice faces the highest energy
price, with food sales and lodging facing
lower and nearly the same energy
prices. Lodging faces the highest cost of
capital. Foodservice faces a higher cost
of capital than food sales. Given the cost
of capital disparity, lodging was
selected for LCC subgroup analysis.
With foodservice facing a higher cost of
capital, it was selected for subgroup
analysis because the higher cost of
capital should lead foodservice
customers to value first cost more and
future electricity savings less than
would be the case for food sales
customers.
At the February 2012 preliminary
analysis public meeting, DOE asked for
input on the LCC subgroup analysis,
and in particular, about appropriate
groups for analysis. Manitowoc
recommended that DOE look at small
businesses, such as franchise operations
and independent proprietor-run
establishments. Manitowoc added that
while there are institutional sectors with
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longer windows, there are others—
‘‘mom and pops’’—that represent a large
part of the market and which may be
unfairly impacted by new standards
because of their short payback windows
and cash constraints. Manitowoc also
indicated it is not just restaurants, it is
hotels operated by franchisees and in
some cases even hotel chains.
(Manitowoc, Public Meeting Transcript,
No. 42 at p. 169)
DOE estimated the impact on the
identified customer subgroups using the
LCC spreadsheet model. The standard
LCC and PBP analyses (described in
section IV.G) include various types of
businesses that use automatic
commercial ice makers. For the LCC
subgroup analysis, it was assumed that
the subgroups analyzed do not have
access to national purchasing accounts
or two major capital markets thereby
making the discount rates higher for
these subgroups. Details of the data used
for LCC subgroup analysis and results
are presented in chapter 11 of the NOPR
TSD.
J. Manufacturer Impact Analysis
1. Overview
DOE performed an MIA to estimate
the impacts of amended energy
conservation standards on
manufacturers of automatic commercial
ice makers. The MIA has both
quantitative and qualitative aspects and
includes analyses of forecasted industry
cash flows, the INPV, investments in
research and development (R&D) and
manufacturing capital, and domestic
manufacturing employment.
Additionally, the MIA seeks to
determine how amended energy
conservation standards might affect
manufacturing employment, capacity,
and competition, as well as how
standards contribute to overall
regulatory burden. Finally, the MIA
serves to identify any disproportionate
impacts on manufacturer subgroups, in
particular, small businesses.
The quantitative part of the MIA
primarily relies on the Government
Regulatory Impact Model (GRIM), an
industry cash flow model with inputs
specific to this rulemaking. The key
GRIM inputs include data on the
industry cost structure, unit production
costs, product shipments, manufacturer
markups, and investments in R&D and
manufacturing capital required to
produce compliant products. The key
GRIM outputs are the INPV, which is
the sum of industry annual cash flows
over the analysis period, discounted
using the industry weighted average
cost of capital, and the impact to
domestic manufacturing employment.
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The model estimates the impacts of
more-stringent energy conservation
standards on a given industry by
comparing changes in INPV and
domestic manufacturing employment
between a base case and the various
TSLs in the standards case. To capture
the uncertainty relating to manufacturer
pricing strategy following amended
standards, the GRIM estimates a range of
possible impacts under different
markup scenarios.
The qualitative part of the MIA
addresses manufacturer characteristics
and market trends. Specifically, the MIA
considers such factors as manufacturing
capacity, competition within the
industry, the cumulative impact of other
DOE and non-DOE regulations, and
impacts on small business
manufacturers. The complete MIA is
outlined in chapter 12 of the NOPR
TSD.
DOE conducted the MIA for this
rulemaking in three phases. In Phase 1
of the MIA, DOE prepared a profile of
the automatic commercial ice maker
industry. This included a top-down cost
analysis of automatic commercial ice
maker manufacturers that DOE used to
derive preliminary financial inputs for
the GRIM (e.g., revenues; materials,
labor, overhead, and depreciation
expenses; selling, general, and
administrative expenses (SG&A); and
R&D expenses). DOE also used public
sources of information to further
calibrate its initial characterization of
the automatic commercial ice maker
industry, including company Securities
and Exchange Commission (SEC) 10–K
filings, corporate annual reports, the
U.S. Census Bureau’s Economic Census,
and reports from Dunn & Bradstreet.
In Phase 2 of the MIA, DOE prepared
a framework industry cash flow analysis
to quantify the impacts of new and
amended energy conservation
standards. The GRIM uses several
factors to determine a series of annual
cash flows starting with the
announcement of the standard and
extending over a 30-year period
following the effective date of the
standard. These factors include annual
expected revenues, costs of sales, SG&A
and R&D expenses, taxes, and capital
expenditures. In general, energy
conservation standards can affect
manufacturer cash flow in three distinct
ways: (1) create a need for increased
investment; (2) raise production costs
per unit; and (3) alter revenue due to
higher per-unit prices and changes in
sales volumes.
In addition, during Phase 2, DOE
developed interview guides to distribute
to manufacturers of automatic
commercial ice makers in order to
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develop other key GRIM inputs,
including product and capital
conversion costs, and to gather
additional information on the
anticipated effects of energy
conservation standards on revenues,
direct employment, capital assets,
industry competitiveness, and subgroup
impacts.
In Phase 3 of the MIA, DOE
conducted structured, detailed
interviews with a representative crosssection of manufacturers. During these
interviews, DOE discussed engineering,
manufacturing, procurement, and
financial topics to validate assumptions
used in the GRIM and to identify key
issues or concerns. See section IV.J.4 for
a description of the key issues raised by
manufacturers during the interviews. As
part of Phase 3, DOE also evaluated
subgroups of manufacturers that may be
disproportionately impacted by
amended standards or that may not be
accurately represented by the average
cost assumptions used to develop the
industry cash flow analysis. Such
manufacturer subgroups may include
small manufacturers, low volume
manufacturers, niche players, and/or
manufacturers exhibiting a cost
structure that largely differs from the
industry average.
DOE identified one subgroup, small
manufacturers, for which average cost
assumptions may not hold. DOE applied
the small business size standards
published by the SBA to determine
whether a company is considered a
small business. 65 FR 30840, May 15,
2000, as amended at 67 FR 52602, Aug.
13, 2002; 74 FR 46313, Sept. 9, 2009. To
be categorized as a small business under
North American Industry Classification
System (NAICS) 333415, ‘‘AirConditioning and Warm Air Heating
Equipment and Commercial and
Industrial Refrigeration Equipment
Manufacturing,’’ which includes
commercial ice maker manufacturing, a
manufacturer and its affiliates may
employ a maximum of 750 employees.
The 750-employee threshold includes
all employees in a business’s parent
company and any other subsidiaries.
Based on this classification, DOE
identified seven manufacturers of
automatic commercial ice makers that
qualify as small businesses. The
automatic commercial ice maker small
manufacturer subgroup is discussed in
chapter 12 of the NOPR TSD and in
section VI.B.1 of this rulemaking.
2. Government Regulatory Impact Model
DOE uses the GRIM to quantify the
changes in industry cash flows resulting
from new or amended energy
conservation standards. The GRIM uses
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manufacturer costs, markups,
shipments, and industry financial
information to arrive at a series of basecase annual cash flows absent new or
amended standards, beginning with the
present year, 2013, and continuing
through 2047. The GRIM then models
changes in costs, investments,
shipments, and manufacturer margins
that may result from new or amended
energy conservation standards and
compares these results against those in
the base-case forecast of annual cash
flows. The primary quantitative output
of the GRIM is the INPV, which DOE
calculates by summing the stream of
annual discounted cash flows over the
full analysis period. For manufacturers
of automatic commercial ice makers,
DOE used a real discount rate of 9.2
percent, the weighted average cost of
capital as derived from industry
financials. DOE then modified this
figure based on feedback received
during confidential interviews with
manufacturers.
The GRIM calculates cash flows using
standard accounting principles and
compares changes in INPV between the
base case and the various TSLs. The
difference in INPV between the base
case and a standards case represents the
financial impact of the amended
standard on manufacturers at that
particular TSL. As discussed previously,
DOE collected the necessary
information to develop key GRIM inputs
from a number of sources, including
publicly available data and interviews
with manufacturers (described in the
next section). The GRIM results are
shown in section V.B.2.a. Additional
details about the GRIM can be found in
chapter 12 of the NOPR TSD.
a. Government Regulatory Impact Model
Key Inputs
Manufacturer Production Costs
Manufacturing a higher efficiency
product is typically more expensive
than manufacturing a baseline product
due to the use of more complex and
typically more costly components. The
changes in the MPCs of the analyzed
products can affect the revenues, gross
margins, and cash flow of the industry,
making product cost data key GRIM
inputs for DOE’s analysis.
For each efficiency level of each
equipment class that was directly
analyzed, DOE used the MPCs
developed in the engineering analysis,
as described in section IV.A.2 and
further detailed in chapter 5 of the
NOPR TSD. For equipment classes that
were indirectly analyzed, DOE used a
composite of MPCs from similar
equipment classes, substitute
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component costs, and design options to
develop an MPC for each efficiency
level. For equipment classes that had
multiple units analyzed, DOE used a
weighted average MPC based on the
relative shipments of products at each
efficiency level as the input for the
GRIM. Additionally, DOE used
information from its teardown analysis,
described in section IV.D, to
disaggregate the MPCs into material and
labor costs. These cost breakdowns and
equipment markups were validated with
manufacturers during manufacturer
interviews.
Base-Case Shipments Forecast
The GRIM estimates manufacturer
revenues based on total unit shipment
forecasts and the distribution of
shipments by efficiency level. Changes
in sales volumes and efficiency mix
over time can significantly affect
manufacturer finances. For this analysis,
the GRIM uses the NIA’s annual
shipment forecasts derived from the
shipments analysis from 2013, the base
year, to 2047, the end of the analysis
period. See chapter 9 of the NOPR TSD
for additional details.
Product and Capital Conversion Costs
Amended energy conservation
standards will cause manufacturers to
incur conversion costs to bring their
production facilities and product
designs into compliance. For the MIA,
DOE classified these conversion costs
into two major groups: (1) product
conversion costs and (2) capital
conversion costs. Product conversion
costs include investments in research,
development, testing, marketing, and
other non-capitalized costs necessary to
make product designs comply with new
or amended energy conservation
standards. Capital conversion costs
include investments in property, plant,
and equipment necessary to adapt or
change existing production facilities
such that new product designs can be
fabricated and assembled.
Stranded Assets
If new or amended energy
conservation standards require
investment in new manufacturing
capital, there also exists the possibility
that they will render existing
manufacturing capital obsolete. In the
case that this obsolete manufacturing
capital is not fully depreciated at the
time new or amended standards go into
effect, this would result in the stranding
of these assets, and would necessitate
the write-down of their residual undepreciated value.
DOE used multiple sources of data to
evaluate the level of product and capital
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conversion costs and stranded assets
manufacturers would likely face to
comply with new or amended energy
conservation standards. DOE used
manufacturer interviews to gather data
on the level of investment anticipated at
each proposed efficiency level and
validated these assumptions using
estimates of capital requirements
derived from the product teardown
analysis and engineering model
described in section IV.D. These
estimates were then aggregated and
scaled using information gained from
industry product databases to derive
total industry estimates of product and
capital conversion costs and to protect
confidential information.
In general, DOE assumes that all
conversion-related investments occur
between the year the final rule is
published and the year by which
manufacturers must comply with the
new or amended standards. The
investment figures used in the GRIM
can be found in section V.B.2.a of this
notice. For additional information on
the estimated product conversion and
capital conversion costs, see chapter 12
of the NOPR TSD.
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b. Government Regulatory Impact Model
Scenarios
Markup Scenarios
As discussed in section IV.D, MSPs
include direct manufacturing
production costs (i.e., labor, material,
overhead, and depreciation estimated in
DOE’s MPCs) and all non-production
costs (i.e., SG&A, R&D, and interest),
along with profit. To calculate the MSPs
in the GRIM, DOE applied manufacturer
markups to the MPCs estimated in the
engineering analysis. Modifying these
markups in the standards case yields
different sets of impacts on
manufacturers. For the MIA, DOE
modeled two standards-case markup
scenarios to represent the uncertainty
regarding the potential impacts on
prices and profitability for
manufacturers following the
implementation of amended energy
conservation standards: (1) A
preservation of gross margin percentage
markup scenario; and (2) a preservation
of earnings before interest and taxes
(EBIT) markup scenario. These
scenarios lead to different markups
values that, when applied to the MPCs,
result in varying revenue and cash flow
impacts.
Under the preservation of gross
margin percentage scenario, DOE
applied a single, uniform ‘‘gross margin
percentage’’ markup across all efficiency
levels. As production costs increase
with efficiency, this scenario implies
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that the absolute dollar markup will
increase as well. Based on publicly
available financial information for
manufacturers of automatic commercial
ice makers and comments from
manufacturer interviews, DOE assumed
the industry average markup on
production costs to be 1.25. Because this
markup scenario assumes that
manufacturers would be able to
maintain their gross margin percentage
as production costs increase in response
to an amended energy conservation
standard, it represents a lower bound of
industry impacts (higher industry
profitability) under an amended energy
conservation standard.
In the preservation of EBIT markup
scenario, manufacturer markups are
calibrated so that EBIT in the year after
the compliance date of the amended
energy conservation standard is the
same as in the base case. Under this
scenario, as the cost of production goes
up, manufacturers are generally
required to reduce the markups on their
minimally compliant products to
maintain a cost competitive offering.
The implicit assumption behind this
scenario is that the industry can only
maintain EBIT in absolute dollars after
compliance with the amended standard
is required. Therefore, operating margin
(as a percentage) shrinks in the
standards cases. This markup scenario
represents an upper bound of industry
impacts (lower profitability) under an
amended energy conservation standard.
3. Discussion of Comments
In response to the February 2012
preliminary analysis public meeting,
interested parties commented on the
assumptions and results of the
preliminary analysis TSD. Oral and
written comments addressed several
topics, including the impact to suppliers
and the distribution channel, the
importance of the ENERGYSTAR
program, cumulative regulatory burden,
and the impact to small manufacturers.
a. Impact to Suppliers, Distributors,
Dealers, and Contractors
AHRI commented that DOE must
perform analyses to assess the impact of
the rule on component suppliers,
distributors, dealers, and contractors.
Where the MIA serves to assess the
impact of amended energy conservation
standards on manufacturers of
automatic commercial ice makers; any
impact on distributors, dealers, and
contractors falls outside the scope of
this analysis.
Impacts on component suppliers
might arise if manufacturers switched to
more-efficient components, or if there
was a substantial reduction of orders
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following new or amended standards. In
public comments, manufacturers
expressed that given their low
production volumes, the automatic
commercial ice maker manufacturing
industry has little influence over
component suppliers relative to other
commercial refrigeration equipment
industries. It follows that energy
conservation standards for automatic
commercial ice makers would have little
impact on component suppliers given
their marginal contribution to overall
commercial refrigeration component
demand.
b. ENERGY STAR
Manitowoc commented that it is a
very strong supporter of ENERGY STAR
and that certification is very important
to its customers because of the potential
for utility rebates, Leadership in Energy
and Environmental Design (LEED)
certification, and other reasons.
Manitowoc expressed concern that, if
efficiency standards were raised to the
max-tech level, there would be no more
room for an ENERGY STAR category,
which would be disruptive to the
industry.
DOE acknowledges the importance of
the ENERGY STAR program and of
understanding its interaction with
energy efficiency standards. However,
EPCA requires DOE to establish energy
conservation standards at the maximum
level that is technically feasible and
economically justified. DOE has found,
over time, with other products, as the
standard level is increased,
manufacturers’ research results in
energy efficiency improvements that are
regarded by the ENERGY STAR
program. As such, any standard level
below the max-tech level continues to
leave room for ENERGY STAR rebate
programs.
c. Cumulative Regulatory Burden
AHRI commented on the cumulative
regulatory burden associated with DOE
efficiency standards. AHRI indicated
that several legislative and regulatory
activities should be considered,
including legislation intended to reduce
lead in drinking water and climate
change bills that may be considered by
Congress. (AHRI, No. 49 at p. 4)
DOE takes into account the
cumulative cost of multiple Federal
regulations on manufacturers in the
cumulative regulatory burden section of
its analysis, which can be found in
section V.B.2.e of this notice. DOE does
not analyze the quantitative impacts of
standards that have not yet been
finalized. Similarly, DOE does not
analyze the impacts of potential climate
change bills because any impacts would
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be speculative in the absence of final
legislation.
AHRI noted that California has
regulations to limit GHGs and the
measures established by the California
Air Resources Board (CARB) to reduce
global warming will reduce the use of
refrigerants such as HFCs. CARB is
currently limiting the in-State use of
refrigerants considered to have high
global warming potential (GWP) in nonresidential refrigeration systems through
its Refrigerant Management Program
that became effective on January 1,
2011.56 According to this new
regulation, facilities with refrigeration
systems that have a refrigerant capacity
exceeding 50 lb must repair leaks within
14 days of detection, maintain on-site
records of all leak repairs, and keep
receipts of all refrigerant purchases. The
regulation applies to any person or
company that installs, services, or
disposes of appliances with high-GWP
refrigerants. Refrigeration systems with
a refrigerant capacity exceeding 50 lb
typically belong to food retail operations
with remote condensing racks that store
refrigerant serving multiple commercial
refrigeration and ice-making units
within a business. However, automatic
commercial ice makers in food retail
establishments are usually installed and
serviced by refrigeration contractors, not
manufacturers. As a result, although
these CARB regulations apply to
refrigeration technicians and owners of
facilities with refrigeration systems,
they are unlikely to represent a
regulatory burden for manufacturers of
automatic commercial ice makers.
The discussion of cumulative
regulatory burden on manufacturers of
automatic commercial ice makers is
detailed further in chapter 12 of the
NOPR TSD.
d. Small Manufacturers
Howe observed that most highcapacity ice makers are made by small
manufacturers, and consequently,
setting higher efficiency standards for
high-capacity equipment may be
discriminatory against small
manufacturers. (Howe, No. 51 at p. 2)
DOE agrees that amended standards
may have disproportionate impacts on
smaller manufacturers. To make this
determination, the DOE conducts an
analysis of impacts on certain
manufacturer subgroups including small
businesses to assess if any impacts
prove to be disproportionate. The
results of this analysis are described
further in section VI.B of this notice and
detailed in chapter 12 of the NOPR TSD.
56 See www.arb.ca.gov/cc/reftrack/
reftrackrule.html.
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4. Manufacturer Interviews
To inform the MIA, DOE interviewed
manufacturers with an estimated
combined market share of 95 percent.
The information gathered during these
interviews enabled DOE to tailor the
GRIM to reflect the unique financial
characteristics of the automatic
commercial ice maker industry. These
confidential interviews provided
information that DOE used to evaluate
the impacts of amended energy
conservation standards on manufacturer
cash flows, manufacturing capacities,
and employment levels.
During the manufacturer interviews,
DOE asked manufacturers to describe
their major concerns about this
rulemaking. The following sections
describe the most significant issues
identified by manufacturers. DOE also
includes additional concerns in chapter
12 of the NOPR TSD.
a. Price Sensitivity
All manufacturers interviewed
characterized the market for automatic
commercial ice makers as extremely
price sensitive. They hold the position
that new and amended standards will
result in decreased profit margins as
they will be unable to pass through
costs relating to standards compliance.
They noted that this will be particularly
troublesome for lower capacity
equipment classes (Small SCU and
Small IMH), which are sold primarily to
smaller restaurants and food service
establishments with limited access to
capital. Additionally, they noted that
distributors tend to be individual
proprietors or small franchises with
limited opportunities to extend
financing to their customers.
Manufacturers went on to report that
while energy efficiency is important, it
is not a feature for which customers
would pay a premium.
One manufacturer also noted that
replacement parts represented 70
percent of sales, and while sales of parts
had increased since 2009, unit sales had
decreased, indicating that customers
were holding onto units longer. The
ability to extend the life of a unit
through repairs and refurbishment
presents a further economic challenge to
manufacturers facing energy efficiency
standards.
b. Enforcement
Manufacturers characterized the
automatic commercial ice maker market
as a niche market with a high degree of
competition. The recent entrance of
foreign manufacturers has led to a
further tightening of price competition
due to the lower labor costs of these
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foreign manufacturers. Several domestic
manufacturers expressed concern about
the enforcement of an amended energy
efficiency standard for automatic
commercial ice makers produced
overseas. Manufacturers believe that
insufficient enforcement will lead to
market distortions, as companies that
make the necessary investments to meet
amended standards would be at a
distinct pricing disadvantage to
unscrupulous competitors, often times
foreign manufacturers, that do not fully
comply. The manufacturers requested
that DOE take the enforcement action
necessary to maintain a level playing
field and to eliminate non-compliant
products from the market.
c. Reliability Impacts
Some manufacturers expressed
concerns that future energy
conservation standards would have an
adverse impact on the reliability of their
products. One manufacturer stated that
any time new components or designs
are introduced, that there is an increase
in service calls and the mean time
between failures drops as they work out
the issues. This manufacturer went on
to emphasize that reliability is the most
important feature of their products.
d. Impact on Innovation
Several manufacturers expressed
concerns over the imbalance of internal
engineering resources brought about by
the regular revision and introduction of
energy conservation standards. As
energy use has become increasingly
regulated, manufacturers have had to
shift engineering and support resources
away from other initiatives, adversely
affecting product innovation outside of
energy efficiency. One manufacturer
reported that a previous round of
standards required nearly all of the
company’s engineering resources for
between 1 and 2 years. Where the R&D
effort required for compliance is
intermittent, innovation is impacted
without adding to overall employment.
DOE requests additional comment on
the intermittency of R&D efforts directed
at compliance with energy conservation
standards and its impact on other
research and development resources.
K. Emissions Analysis
In the emissions analysis, DOE
estimates the reduction in power sector
emissions of CO2, NOX, SO2, and Hg
from potential energy conservation
standards for automatic commercial ice
makers. In addition, DOE estimates
emissions impacts in production
activities (extracting, processing, and
transporting fuels) that provide the
energy inputs to power plants. These are
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referred to as ‘‘upstream’’ emissions.
Together, these emissions account for
the full-fuel-cycle (FFC). In accordance
with DOE’s FFC Statement of Policy (76
FR 51282 (Aug. 18, 2011)), as amended
at 77 FR 49701 (Aug. 17, 2012), the FFC
analysis includes impacts on emissions
of methane (CH4) and nitrous oxide
(N2O), both of which are recognized as
GHGs.
DOE conducted the emissions
analysis using emissions factors that
were derived from data in AEO2013,
supplemented by data from other
sources. DOE developed separate
emissions factors for power sector
emissions and upstream emissions. The
method that DOE used to derive
emissions factors is described in chapter
13 of the NOPR TSD.
The emissions intensity factors are
expressed in terms of physical units per
MWh or MMBtu of site energy savings.
For CH4 and N2O, DOE also presents
results in terms of units of carbon
dioxide equivalent (CO2eq). Gases are
converted to CO2eq by multiplying the
physical units by the gas’ global
warming potential (GWP) over a 100
year time horizon. Based on the Fourth
Assessment Report of the
Intergovernmental Panel on Climate
Change, DOE used GWP values of 25 for
CH4 and 298 for N2O.
EIA prepares the AEO using NEMS.
Each annual version of NEMS
incorporates the projected impacts of
existing air quality regulations on
emissions. AEO2013 generally
represents current legislation and
environmental regulations, including
recent government actions, for which
implementing regulations were
available as of December 31, 2012.
SO2 emissions from affected electric
generating units (EGUs) are subject to
nationwide and regional emissions capand-trade programs. Title IV of the
Clean Air Act sets an annual emissions
cap on SO2 for affected EGUs in the 48
contiguous States and the District of
Columbia (DC). SO2 emissions from 28
eastern States and DC were also limited
under the Clean Air Interstate Rule
(CAIR; 70 FR 25162 (May 12, 2005)),
which created an allowance-based
trading program that operates along
with the Title IV program. CAIR was
remanded to U.S. Environmental
Protection Agency (EPA) by the U.S.
Court of Appeals for the District of
Columbia Circuit but it remained in
effect. See North Carolina v. EPA, 550
F.3d 1176 (D.C. Cir. 2008); North
Carolina v. EPA, 531 F.3d 896 (D.C. Cir.
2008). On July 6, 2011 EPA issued a
replacement for CAIR, the Cross-State
Air Pollution Rule (CSAPR). 76 FR
48208 (August 8, 2011). On August 21,
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2012, the DC Circuit issued a decision
to vacate CSAPR. See EME Homer City
Generation, LP v. EPA, 696 F.3d 7, 38
(D.C. Cir. 2012). The court ordered EPA
to continue administering CAIR. The
AEO2013 emissions factors used for
today’s NOPR assume that CAIR
remains a binding regulation through
2040.
The attainment of emissions caps is
typically flexible among EGUs and is
enforced through the use of emissions
allowances and tradable permits. Under
existing EPA regulations, any excess
SO2 emissions allowances resulting
from the lower electricity demand
caused by the adoption of an efficiency
standard could be used to permit
offsetting increases in SO2 emissions by
any regulated EGU. In past rulemakings,
DOE recognized that there was
uncertainty about the effects of
efficiency standards on SO2 emissions
covered by the existing cap-and-trade
system, but it concluded that negligible
reductions in power sector SO2
emissions would occur as a result of
standards.
Beginning in 2015, however, SO2
emissions will fall as a result of the
Mercury and Air Toxics Standards
(MATS) for power plants. 77 FR 9304
(Feb. 16, 2012). In the final MATS rule,
EPA established a standard for hydrogen
chloride as a surrogate for acid gas
hazardous air pollutants (HAP), and also
established a standard for SO2 (a nonHAP acid gas) as an alternative
equivalent surrogate standard for acid
gas HAP. The same controls are used to
reduce HAP and non-HAP acid gas;
thus, SO2 emissions will be reduced as
a result of the control technologies
installed on coal-fired power plants to
comply with the MATS requirements
for acid gas. AEO2013 assumes that, in
order to continue operating, coal plants
must have either flue gas
desulfurization or dry sorbent injection
systems installed by 2015. Both
technologies, which are used to reduce
acid gas emissions, also reduce SO2
emissions. Under the MATS, NEMS
shows a reduction in SO2 emissions
when electricity demand decreases (e.g.,
as a result of energy efficiency
standards). Emissions will be far below
the cap established by CAIR, so it is
unlikely that excess SO2 emissions
allowances resulting from the lower
electricity demand would be needed or
used to permit offsetting increases in
SO2 emissions by any regulated EGU.
Therefore, DOE believes that efficiency
standards will reduce SO2 emissions in
2015 and beyond.
CAIR established a cap on NOX
emissions in 28 eastern States and the
District of Columbia. Energy
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conservation standards are expected to
have little effect on NOX emissions in
those States covered by CAIR because
excess NOX emissions allowances
resulting from the lower electricity
demand could be used to permit
offsetting increases in NOX emissions.
However, standards would be expected
to reduce NOX emissions in the States
not affected by the caps, so DOE
estimated NOX emissions reductions
from the standards considered in
today’s NOPR for these States.
The MATS limit mercury emissions
from power plants, but they do not
include emissions caps and, as such,
DOE’s energy conservation standards
would likely reduce Hg emissions. DOE
estimated mercury emissions reduction
using emissions factors based on
AEO2013, which incorporates the
MATS.
L. Monetizing Carbon Dioxide and Other
Emissions Impacts
As part of the development of this
proposed rule, DOE considered the
estimated monetary benefits from the
reduced emissions of CO2 and NOX that
are expected to result from each of the
TSLs considered. In order to make this
calculation similar to the calculation of
the NPV of consumer benefit, DOE
considered the reduced emissions
expected to result over the lifetime of
equipment shipped in the forecast
period for each TSL. This section
summarizes the basis for the monetary
values used for each of these emissions
and presents the values considered in
this rulemaking.
For today’s NOPR, DOE is relying on
a set of values for the social cost of
carbon (SCC) that was developed by an
interagency process. A summary of the
basis for these values is provided below,
and a more detailed description of the
methodologies used is provided as an
appendix to chapter 14 of the TSD.
1. Social Cost of Carbon
The SCC is an estimate of the
monetized damages associated with an
incremental increase in carbon
emissions in a given year. It is intended
to include (but is not limited to) changes
in net agricultural productivity, human
health, property damages from
increased flood risk, and the value of
ecosystem services. Estimates of the
SCC are provided in dollars per metric
ton of carbon dioxide. A domestic SCC
value is meant to reflect the value of
damages in the United States resulting
from a unit change in carbon dioxide
emissions, while a global SCC value is
meant to reflect the value of damages
worldwide.
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Under section 1(b) of Executive Order
12866, agencies must, to the extent
permitted by law, ‘‘assess both the costs
and the benefits of the intended
regulation and, recognizing that some
costs and benefits are difficult to
quantify, propose or adopt a regulation
only upon a reasoned determination
that the benefits of the intended
regulation justify its costs.’’ The purpose
of the SCC estimates presented here is
to allow agencies to incorporate the
monetized social benefits of reducing
CO2 emissions into cost-benefit analyses
of regulatory actions that have small, or
‘‘marginal,’’ impacts on cumulative
global emissions. The estimates are
presented with an acknowledgement of
the many uncertainties involved and
with a clear understanding that they
should be updated over time to reflect
increasing knowledge of the science and
economics of climate impacts.
As part of the interagency process that
developed these SCC estimates,
technical experts from numerous
agencies met on a regular basis to
consider public comments, explore the
technical literature in relevant fields,
and discuss key model inputs and
assumptions. The main objective of this
process was to develop a range of SCC
values using a defensible set of input
assumptions grounded in the existing
scientific and economic literatures. In
this way, key uncertainties and model
differences transparently and
consistently inform the range of SCC
estimates used in the rulemaking
process.
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a. Monetizing Carbon Dioxide Emissions
When attempting to assess the
incremental economic impacts of carbon
dioxide (CO2) emissions, the analyst
faces a number of serious challenges. A
report from the National Research
Council 57 points out that any
assessment will suffer from uncertainty,
speculation, and lack of information
about (1) future emissions of greenhouse
gases, (2) the effects of past and future
emissions on the climate system, (3) the
impact of changes in climate on the
physical and biological environment,
and (4) the translation of these
environmental impacts into economic
damages. As a result, any effort to
quantify and monetize the harms
associated with climate change will
raise serious questions of science,
economics, and ethics and should be
viewed as provisional.
57 National Research Council. Hidden Costs of
Energy: Unpriced Consequences of Energy
Production and Use. National Academies Press:
Washington, DC (2009).
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Despite the serious limits of both
quantification and monetization, SCC
estimates can be useful in estimating the
social benefits of reducing carbon
dioxide emissions. Most Federal
regulatory actions can be expected to
have marginal impacts on global
emissions. For such policies, the agency
can estimate the benefits from reduced
(or costs from increased) emissions in
any future year by multiplying the
change in emissions in that year by the
SCC value appropriate for that year. The
net present value of the benefits can
then be calculated by multiplying each
of these future benefits by an
appropriate discount factor and
summing across all affected years. This
approach assumes that the marginal
damages from increased emissions are
constant for small departures from the
baseline emissions path, an
approximation that is reasonable for
policies that have effects on emissions
that are small relative to cumulative
global carbon dioxide emissions. For
policies that have a large (non-marginal)
impact on global cumulative emissions,
there is a separate question of whether
the SCC is an appropriate tool for
calculating the benefits of reduced
emissions. This concern is not
applicable to this notice, however.
It is important to emphasize that the
interagency process is committed to
updating these estimates as the science
and economic understanding of climate
change and its impacts on society
improves over time. In the meantime,
the interagency group will continue to
explore the issues raised by this analysis
and consider public comments as part of
the ongoing interagency process.
b. Social Cost of Carbon Values Used in
Past Regulatory Analyses
Economic analyses for Federal
regulations have used a wide range of
values to estimate the benefits
associated with reducing carbon dioxide
emissions. The model year 2011
Corporate Average Fuel Economy final
rule, the U.S. Department of
Transportation (DOT) used both a
‘‘domestic’’ SCC value of $2 per metric
ton of CO2 and a ‘‘global’’ SCC value of
$33 per metric ton of CO2 for 2007
emission reductions (in 2007$),
increasing both values at 2.4 percent per
year. DOT also included a sensitivity
analysis at $80 per metric ton of CO2.58
A 2008 regulation proposed by DOT
58 See
Average Fuel Economy Standards
Passenger Cars and Light Trucks Model Year 2011,
74 FR 14196 (March 30, 2009) (Final Rule); Final
Environmental Impact Statement Corporate Average
Fuel Economy Standards, Passenger Cars and Light
Trucks, Model Years 2011–2015 at 3–90 (Oct. 2008)
(Available at: https://www.nhtsa.gov/fuel-economy).
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assumed a domestic SCC value of $7 per
metric ton of CO2 (in 2006$) for 2011
emission reductions (with a range of $0–
$14 for sensitivity analysis), also
increasing at 2.4 percent per year.59 A
regulation for packaged terminal air
conditioners and packaged terminal
heat pumps finalized by DOE in 2008
used a domestic SCC range of $0 to $20
per metric ton CO2 for 2007 emission
reductions (in 2007$). 73 FR 58772,
58814 (Oct. 7, 2008) In addition, EPA’s
2008 Advance Notice of Proposed
Rulemaking on Regulating Greenhouse
Gas Emissions Under the Clean Air Act
identified what it described as ‘‘very
preliminary’’ SCC estimates subject to
revision. 73 FR 44354 (July 30, 2008).
EPA’s global mean values were $68 and
$40 per metric ton CO2 for discount
rates of approximately 2 percent and 3
percent, respectively (in 2006$ for 2007
emissions).
In 2009, an interagency process was
initiated to offer a preliminary
assessment of how best to quantify the
benefits from reducing carbon dioxide
emissions. To ensure consistency in
how benefits are evaluated across
agencies, the Administration sought to
develop a transparent and defensible
method, specifically designed for the
rulemaking process, to quantify avoided
climate change damages from reduced
CO2 emissions. The interagency group
did not undertake any original analysis.
Instead, it combined SCC estimates from
the existing literature to use as interim
values until a more comprehensive
analysis could be conducted. The
outcome of the preliminary assessment
by the interagency group was a set of
five interim values: global SCC
estimates for 2007 (in 2006$) of $55,
$33, $19, $10, and $5 per metric ton of
CO2. These interim values represented
the first sustained interagency effort
within the U.S. government to develop
an SCC for use in regulatory analysis.
The results of this preliminary effort
were presented in several proposed and
final rules.
c. Current Approach and Key
Assumptions
Since the release of the interim
values, the interagency group
reconvened on a regular basis to
generate improved SCC estimates.
Specifically, the group considered
public comments and further explored
59 See Average Fuel Economy Standards,
Passenger Cars and Light Trucks, Model Years
2011–2015, 73 FR 24352 (May 2, 2008) (Proposed
Rule); Draft Environmental Impact Statement
Corporate Average Fuel Economy Standards,
Passenger Cars and Light Trucks, Model Years
2011–2015 at 3–58 (June 2008) (Available at:
https://www.nhtsa.gov/fuel-economy)
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the technical literature in relevant
fields. The interagency group relied on
three integrated assessment models
commonly used to estimate the SCC: the
FUND, DICE, and PAGE models. These
models are frequently cited in the peerreviewed literature, and were used in
the last assessment of the
Intergovernmental Panel on Climate
Change. Each model was given equal
weight in the SCC values that were
developed.
Each model takes a slightly different
approach to model how changes in
emissions result in changes in economic
damages. A key objective of the
interagency process was to enable a
consistent exploration of the three
models while respecting the different
approaches to quantifying damages
taken by the key modelers in the field.
An extensive review of the literature
was conducted to select three sets of
input parameters for these models:
climate sensitivity, socio-economic and
emissions trajectories, and discount
rates. A probability distribution for
climate sensitivity was specified as an
input into all three models. In addition,
the interagency group used a range of
scenarios for the socio-economic
parameters and a range of values for the
discount rate. All other model features
were left unchanged, relying on the
model developers’ best estimates and
judgments.
The interagency group selected four
sets of SCC values for use in regulatory
analyses. Three sets of values are based
on the average SCC from the three
integrated assessment models, at
discount rates of 2.5, 3, and 5 percent.
The fourth set, which represents the
95th percentile SCC estimate across all
three models at a 3-percent discount
rate, is included to represent higherthan-expected impacts from temperature
change further out in the tails of the
SCC distribution. The values grow in
real terms over time. Additionally, the
interagency group determined that a
range of values from 7 percent to 23
percent should be used to adjust the
global SCC to calculate domestic effects,
although preference is given to
consideration of the global benefits of
reducing CO2 emissions. Table IV.31
presents the values in the 2010
interagency group report,60 which is
reproduced in appendix 14–A of the
NOPR TSD.
TABLE IV.31—ANNUAL SCC VALUES FROM 2010 INTERAGENCY REPORT, 2010–2050
[2007 dollars per metric ton]
Discount rate
(%)
5
2.5
3
Average
2010
2015
2020
2025
2030
2035
2040
2045
2050
3
Average
Average
95th percentile
.................................................................................................................
.................................................................................................................
.................................................................................................................
.................................................................................................................
.................................................................................................................
.................................................................................................................
.................................................................................................................
.................................................................................................................
.................................................................................................................
4.7
5.7
6.8
8.2
9.7
11.2
12.7
14.2
15.7
updated sets of SCC estimates in five
year increments from 2010 to 2050. The
full set of annual SCC estimates between
2010 and 2050 is reported in appendix
14–B of the NOPR TSD. The central
value that emerges is the average SCC
The SCC values used for today’s
notice were generated using the most
recent versions of the three integrated
assessment models that have been
published in the peer-reviewed
literature.61 Table IV.32 shows the
21.4
23.8
26.3
29.6
32.8
36.0
39.2
42.1
44.9
35.1
38.4
41.7
45.9
50.0
54.2
58.4
61.7
65.0
64.9
72.8
80.7
90.4
100.0
109.7
119.3
127.8
136.2
across models at the 3-percent discount
rate. However, for purposes of capturing
the uncertainties involved in regulatory
impact analysis, the interagency group
emphasizes the importance of including
all four sets of SCC values.
TABLE IV.32—ANNUAL SCC VALUES FROM 2013 INTERAGENCY UPDATE, 2010–2050
[2007 dollars per metric ton CO2]
Discount rate
(%)
Year
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3
2.5
3
Average
2010
2015
2020
2025
2030
2035
2040
5
Average
Average
95th percentile
.................................................................................................................
.................................................................................................................
.................................................................................................................
.................................................................................................................
.................................................................................................................
.................................................................................................................
.................................................................................................................
60 Social Cost of Carbon for Regulatory Impact
Analysis Under Executive Order 12866. Interagency
Working Group on Social Cost of Carbon, United
States Government, February 2010.
2010
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inforeg/for-agencies/Social-Cost-of-Carbon-forRIA.pdf.>
61 Technical Update of the Social Cost of Carbon
for Regulatory Impact Analysis Under Executive
Order 12866. Interagency Working Group on Social
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37
43
47
52
56
61
51
57
64
69
75
80
86
89
109
128
143
159
175
191
Cost of Carbon, United States Government. May
2013; revised November 2013.
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TABLE IV.32—ANNUAL SCC VALUES FROM 2013 INTERAGENCY UPDATE, 2010–2050—Continued
[2007 dollars per metric ton CO2]
Discount rate
(%)
Year
5
3
2.5
3
Average
Average
Average
95th percentile
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2045 .................................................................................................................
2050 .................................................................................................................
It is important to recognize that a
number of key uncertainties remain, and
that current SCC estimates should be
treated as provisional and revisable
since they will evolve with improved
scientific and economic understanding.
The interagency group also recognizes
that the existing models are imperfect
and incomplete. The National Research
Council report mentioned above points
out that there is tension between the
goal of producing quantified estimates
of the economic damages from an
incremental ton of carbon and the limits
of existing efforts to model these effects.
There are a number of concerns and
problems that should be addressed by
the research community, including
research programs housed in many of
the Federal agencies participating in the
interagency process to estimate the SCC.
The interagency group intends to
periodically review and reconsider
those estimates to reflect increasing
knowledge of the science and
economics of climate impacts, as well as
improvements in modeling.
In summary, in considering the
potential global benefits resulting from
reduced CO2 emissions, DOE used the
values from the 2013 interagency report
adjusted to 2012$ using the Gross
Domestic Product (GDP) price deflator.
For each of the four case of SCC values,
the values for emissions in 2015 were
$11.8, $39.7, $61.2, and $117.0 per
metric ton avoided (values expressed in
2012$). DOE derived values after 2050
using the relevant growth rates for the
2040–2050 period in the interagency
update.
DOE multiplied the CO2 emissions
reduction estimated for each year by the
SCC value for that year in each of the
four cases. To calculate a present value
of the stream of monetary values, DOE
discounted the values in each of the
four cases using the specific discount
rate that had been used to obtain the
SCC values in each case.
2. Valuation of Other Emissions
Reductions
As noted above, DOE has taken into
account how new or amended energy
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26
conservation standards would reduce
NOX emissions in those 22 States not
affected by emission caps. DOE
estimated the monetized value of NOX
emissions reductions resulting from
each of the TSLs considered for today’s
NOPR based on estimates found in the
relevant scientific literature. Estimates
of monetary value for reducing NOX
from stationary sources range from $468
to $4,809 per ton (2012$).62 DOE
calculated monetary benefits using a
medium value for NOX emissions of
$2,639 per short ton (in 2012$), and real
discount rates of 3 percent and 7
percent.
DOE is evaluating appropriate
monetization of avoided SO2 and Hg
emissions in energy conservation
standards rulemakings. It has not
included monetization in the current
analysis.
M. Utility Impact Analysis
In the utility impact analysis, DOE
analyzes the changes in electric
installed capacity and generation that
result for each TSL. The utility impact
analysis uses a variant of NEMS,63
which is a public domain, multisectored, partial equilibrium model of
the U.S. energy sector. DOE uses a
variant of this model, referred to as
NEMS–BT,64 to account for selected
utility impacts of new or amended
energy conservation standards. DOE’s
analysis consists of a comparison
between model results for the most
62 For additional information, refer to U.S. Office
of Management and Budget, Office of Information
and Regulatory Affairs, 2006 Report to Congress on
the Costs and Benefits of Federal Regulations and
Unfunded Mandates on State, Local, and Tribal
Entities, Washington, DC.
63 For more information on NEMS, refer to the
U.S. Department of Energy, Energy Information
Administration documentation. A useful summary
is National Energy Modeling System: An Overview
2003, DOE/EIA–0581 (2003), March, 2003.
64 DOE/EIA approves use of the name ‘‘NEMS’’ to
describe only an official version of the model
without any modification to code or data. Because
this analysis entails some minor code modifications
and the model is run under various policy scenarios
that are variations on DOE/EIA assumptions, DOE
refers to it by the name ‘‘NEMS–BT’’ (‘‘BT’’ is DOE’s
Building Technologies Program, under whose aegis
this work has been performed).
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66
71
92
97
206
220
recent AEO Reference Case and for cases
in which energy use is decremented to
reflect the impact of potential standards.
The energy savings inputs associated
with each TSL come from the NIA.
Chapter 15 of the NOPR TSD describes
the utility impact analysis.
N. Employment Impact Analysis
Employment impacts include direct
and indirect impacts. Direct
employment impacts are any changes in
the number of employees of
manufacturers of the products subject to
standards; the MIA addresses those
impacts. Indirect employment impacts
are changes in national employment
that occur due to the shift in
expenditures and capital investment
caused by the purchase and operation of
more-efficient appliances. Indirect
employment impacts from standards
consist of the jobs created or eliminated
in the national economy due to: (1)
reduced spending by end users on
energy; (2) reduced spending on new
energy supply by the utility industry; (3)
increased customer spending on the
purchase of new products; and (4) the
effects of those three factors throughout
the economy.
One method for assessing the possible
effects on the demand for labor of such
shifts in economic activity is to compare
sector employment statistics developed
by the Labor Department’s Bureau of
Labor Statistics (BLS). BLS regularly
publishes its estimates of the number of
jobs per million dollars of economic
activity in different sectors of the
economy, as well as the jobs created
elsewhere in the economy by this same
economic activity. Data from BLS
indicate that expenditures in the utility
sector generally create fewer jobs (both
directly and indirectly) than
expenditures in other sectors of the
economy.65 There are many reasons for
these differences, including wage
differences and the fact that the utility
sector is more capital-intensive and less
65 See Bureau of Economic Analysis, ‘‘Regional
Multipliers: A User Handbook for the Regional
Input-Output Modeling System (RIMS II),’’ U.S.
Department of Commerce (1992).
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labor-intensive than other sectors.
Energy conservation standards have the
effect of reducing customer utility bills.
Because reduced customer expenditures
for energy likely lead to increased
expenditures in other sectors of the
economy, the general effect of efficiency
standards is to shift economic activity
from a less labor-intensive sector (i.e.,
the utility sector) to more laborintensive sectors (e.g., the retail and
service sectors). Thus, based on the BLS
data alone, DOE believes net national
employment may increase because of
shifts in economic activity resulting
from amended energy conservation
standards for automatic commercial ice
makers.
For the amended standard levels
considered in today’s NOPR, DOE
estimated indirect national employment
impacts using an input/output model of
the U.S. economy called Impact of
Sector Energy Technologies version
3.1.1 (ImSET).66 ImSET is a specialpurpose version of the ‘‘U.S. Benchmark
National Input-Output’’ (I–O) model,
which was designed to estimate the
national employment and income
effects of energy-saving technologies.
The ImSET software includes a
computer-based I–O model having
structural coefficients that characterize
economic flows among the 187 sectors.
ImSET’s national economic I–O
structure is based on a 2002 U.S.
benchmark table, specially aggregated to
the 187 sectors most relevant to
industrial, commercial, and residential
building energy use. DOE notes that
ImSET is not a general equilibrium
forecasting model, and understands the
uncertainties involved in projecting
employment impacts, especially
changes in the later years of the
analysis. Because ImSET does not
incorporate price changes, the
employment effects predicted by ImSET
may over-estimate actual job impacts
over the long run. For the NOPR, DOE
used ImSET only to estimate short-term
(through 2022) employment impacts.
For more details on the employment
impact analysis, see chapter 16 of the
NOPR TSD.
At the February 2012 preliminary
analysis public meeting, NPCC inquired
whether the money saved from low
water consumption will be moved into
the employment impact analysis along
with the money saved from lower
energy consumption. (NPCC, No. 42 at
66 Scott, M.J., O.V. Livingston, P.J. Balducci, J.M.
Roop, and R.W. Schultz. ImSET 3.1: Impact of
Sector Energy Technologies. 2009. Pacific
Northwest National Laboratory, Richland, WA.
Report No. PNNL–18412.
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pp. 164 and 165) In response, DOE notes
that all changes in operations and
maintenance costs, including water
costs, are captured in the employment
analysis.
For more details on the employment
impact analysis and its results, see
chapter 16 of the NOPR TSD and section
V.B.3.d of this notice.
O. Regulatory Impact Analysis
DOE prepared a regulatory impact
analysis (RIA) for this rulemaking,
which is described in chapter 17 of the
NOPR TSD. The RIA is subject to review
by OIRA in the OMB. The RIA consists
of (1) a statement of the problem
addressed by this regulation and the
mandate for Government action; (2) a
description and analysis of policy
alternatives to this regulation; (3) a
qualitative review of the potential
impacts of the alternatives; and (4) the
national economic impacts of the
proposed standard.
The RIA assesses the effects of
feasible policy alternatives to amended
automatic commercial ice makers
standards and provides a comparison of
the impacts of the alternatives. DOE
evaluated the alternatives in terms of
their ability to achieve significant
energy savings at reasonable cost, and
compared them to the effectiveness of
the proposed rule.
DOE identified the following major
policy alternatives for achieving
increased automatic commercial ice
makers efficiency:
• No new regulatory action
• commercial customer tax credits
• commercial customer rebates
• voluntary energy efficiency targets
• bulk government purchases
• early replacement
DOE qualitatively evaluated each
alternative’s ability to achieve
significant energy savings at reasonable
cost and compared it to the effectiveness
of the proposed rule. DOE assumed that
each alternative policy would induce
commercial customers to voluntarily
purchase at least some higher efficiency
equipment at any of the TSLs. In
contrast to a standard at one of the
TSLs, the adoption rate of the
alternative non-regulatory policy cases
may not be 100 percent, which would
result in lower energy savings than a
standard. The following paragraphs
discuss each policy alternative. (See
chapter 17 of the NOPR TSD for further
details.)
No new regulatory action: The case in
which no regulatory action is taken for
automatic commercial ice makers
constitutes the base-case (or no action)
scenario. By definition, no new
PO 00000
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14909
regulatory action yields zero energy
savings and an NPV of zero dollars.
Commercial customer tax credits:
Customer tax credits are considered a
viable non-regulatory market
transformation program. From a
customer perspective, the most
important difference between rebate and
tax credit programs is that a rebate can
be obtained quickly, whereas receipt of
tax credits is delayed until income taxes
are filed or a tax refund is provided by
the Internal Revenue Service (IRS).
From a societal perspective, tax credits
(like rebates) do not change the installed
cost of the equipment, but rather
transfer a portion of the cost from the
customer to taxpayers as a whole. DOE,
therefore, assumed that equipment costs
in the customer tax credits scenario
were identical to the NIA base case. The
change in the NES and NPV is a result
of the change in the efficiency
distributions that results from lowering
the prices of higher efficiency
equipment.
Commercial customer rebates:
Customer rebates cover a portion of the
difference in incremental product price
between products meeting baseline
efficacy levels and those meeting higher
efficiency levels, resulting in a higher
percentage of customers purchasing
more-efficacious models and decreased
aggregated energy use compared to the
base case. Although the rebate program
reduces the total installed cost to the
customer, it is financed by tax revenues.
Therefore, from a societal perspective,
the installed cost at any efficiency level
does not change with the rebate
program; rather, part of the cost is
transferred from the customer to
taxpayers as a whole. Consequently,
DOE assumed that equipment costs in
the rebates scenario were identical to
the NIA base case. The change in the
NES and NPV is a result of the change
in the efficiency distributions that
results as a consequence of lowering the
prices of higher efficiency equipment.
Voluntary energy efficiency targets:
While it is possible that voluntary
programs for equipment would be
effective, DOE lacks a quantitative basis
to determine how effective such a
program might be. As noted previously,
broader economic and social
considerations are in play than simple
economic return to the equipment
purchaser. DOE lacks the data necessary
to quantitatively project the degree to
which voluntary programs for more
expensive, higher efficiency equipment
would modify the market.
Bulk government purchases and early
replacement incentive programs: DOE
also considered, but did not analyze, the
potential of bulk government purchases
E:\FR\FM\17MRP2.SGM
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maximum NPV efficiency level is the
penultimate efficiency level and the
max-tech level showed a positive NPV
the TSL 4 efficiency level is also the
max-tech level.
TSL 3 was chosen to represent the
group of efficiency levels with the
highest customer NPV at a 7-percent
discount rate.
TSL 2 was selected to provide
intermediate efficiency levels that fill
the gap between the TSLs 1 and 3. Note
that with the number of efficiency levels
available for each equipment class, there
is often overlap between TSL levels.
Thus, TSL 2 includes levels that overlap
with both TSLs 1 and 3. The intent of
TSL 2 is to provide an intermediate
level to preclude big jumps in efficiency
between TSLs 1 and 3.
TSL 1 was set equal to efficiency level
2. In the analysis, efficiency level 2 was
set equivalent to ENERGY STAR for
products rated by ENERGY STAR, and
an equivalent efficiency improvement
for other equipment classes.
classes for analysis. For all equipment
classes, the first efficiency level is the
baseline efficiency level. Based on the
results of the LCC analysis and NIA,
DOE selected five TSLs above the
baseline level for each equipment class
for the NOPR stage of this rulemaking.
Table V.1 shows the mapping between
TSLs and efficiency levels.
TSL 5 was selected at the max-tech
level for all equipment classes.
TSL 4 was chosen as an intermediate
level between the max-tech level and
the maximum customer NPV level,
subject to the requirement that the TSL
4 NPV must be positive. ‘‘Customer
NPV’’ is the NPV of future savings
obtained from the NIA. It provides a
measure of the benefits only to the
customers of the automatic commercial
ice makers, and does not account for the
net benefits to the Nation. The net
benefits to the Nation also include
monetized values of emissions
reductions in addition to the customer
NPV. Where a sufficient number of
efficiency levels allow it, TSL 4 is set at
least one level below max-tech and one
level above the efficiency level with the
highest NPV. In one case, the TSL 4
efficiency level is the maximum NPV
level because the next higher level had
a negative NPV. In cases where the
and early replacement incentive
programs as alternatives to the proposed
standards. Bulk government purchases
would have a very limited impact on
improving the overall market efficiency
of automatic commercial ice makers
because they would be a small part of
the total equipment sold in the market.
In the case of replacement incentives,
several policy options exist to promote
early replacement, including a direct
national program of customer
incentives, incentives paid to utilities to
promote an early replacement program,
market promotions through equipment
manufacturers, and replacement of
government-owned equipment. In
considering early replacements, DOE
estimates that the energy savings
realized through a one-time early
replacement of existing stock equipment
does not result in energy savings
commensurate to the cost to administer
the program. Consequently, DOE did not
analyze this option in detail.
V. Analytical Results
A. Trial Standard Levels
1. Trial Standard Level Formulation
Process and Criteria
DOE selected between four and seven
efficiency levels for all equipment
TABLE V.1—MAPPING BETWEEN TSLS AND EFFICIENCY LEVELS *
Equipment class
TSL 1
TSL 2
TSL 3
TSL 4
IMH–W–Small–B .................................
IMH–W–Med–B ...................................
IMH–W–Large–B †
IMH–W–Large–B1 .......................
IMH–W–Large–B2 .......................
IMH–A–Small–B ..................................
IMH–A–Large–B †
IMH–A–Large–B1 ........................
IMH–A–Large–B2 ........................
RCU–Large–B †
RCU–Large–B1 ............................
RCU–Large–B2 ............................
SCU–W–Large–B ................................
SCU–A–Small–B .................................
SCU–A–Large–B .................................
IMH–A–Small–C ..................................
IMH–A–Large–C .................................
SCU–A–Small–C .................................
Level 2 .................
Level 2 .................
Level 3 .................
Level 2 .................
Level 5 .................
Level 3 .................
Level 5 .................
Level 4 .................
Level 6
Level 5
Level 2 .................
Level 2 .................
Level 2 .................
Level 2 .................
Level 2 .................
Level 3 .................
Level 2 .................
Level 2 .................
Level 5 .................
Level 3 .................
Level 3 .................
Level 6 .................
Level 4
Level 4
Level 7
Level 2 .................
Level 2 .................
Level 3 .................
Level 2 .................
Level 5 .................
Level 3 .................
Level 6 .................
Level 4 .................
Level 6
Level 4
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
Level
2
2
2
2
2
2
2
2
.................
.................
.................
.................
.................
.................
.................
.................
2
2
3
4
4
3
3
3
.................
.................
.................
.................
.................
.................
.................
.................
3
3
5
6
6
4
5
4
.................
.................
.................
.................
.................
.................
.................
.................
4
4
6
7
7
5
6
4
TSL 5
.................
.................
.................
.................
.................
.................
.................
.................
5
5
7
7
7
7
7
6
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
* For three large equipment classes—IMH–W–Large–B, IMH–A–Large–B and RCU–Large–B—because the harvest capacity range is so wide
DOE analyzed two typical models to ensure models at the low and the higher portions of the applicable range were accurately modeled. The
smaller of the two is noted as B1 and the larger as B2.
† DOE analyzed impacts for the B1 and B2 typical units and aggregated impacts to the equipment class level.
Table V.2 illustrates the efficiency
improvements incorporated in all
efficiency levels.
TABLE V.2—PERCENTAGE EFFICIENCY IMPROVEMENT FROM BASELINE BY TSL *
TSL 1
(%)
Equipment class
IMH–W–Small–B ......................................................................................
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(%)
10.0
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TSL 3
(%)
25.0
17MRP2
TSL 4
(%)
25.0
TSL 5
(%)
29.4
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Federal Register / Vol. 79, No. 51 / Monday, March 17, 2014 / Proposed Rules
TABLE V.2—PERCENTAGE EFFICIENCY IMPROVEMENT FROM BASELINE BY TSL *—Continued
TSL 1
(%)
Equipment class
IMH–W–Med–B ........................................................................................
IMH–W–Large–B ......................................................................................
IMH–W–Large–B1 ............................................................................
IMH–W–Large–B2 ............................................................................
IMH–A–Small–B .......................................................................................
IMH–A–Large–B ......................................................................................
IMH–A–Large–B1 .............................................................................
IMH–A–Large–B2 .............................................................................
RCU–Large–B ..........................................................................................
RCU–Large–B1 .................................................................................
RCU–Large–B2 .................................................................................
SCU–W–Large–B .....................................................................................
SCU–A–Small–B ......................................................................................
SCU–A–Large–B .....................................................................................
IMH–A–Small–C ......................................................................................
IMH–A–Large–C ......................................................................................
SCU–A–Small–C ......................................................................................
TSL 2
(%)
10.0
10.0
10.0
10.0
10.0
10.0
10.0
10.0
9.0
9.0
9.0
7.0
7.0
7.0
10.0
10.0
7.0
TSL 3
(%)
10.0
10.0
10.0
10.0
15.0
14.2
15.0
10.0
9.0
9.0
9.0
15.0
20.0
20.0
15.0
15.0
15.0
TSL 4
(%)
15.0
10.0
10.0
10.0
25.0
23.4
25.0
15.0
15.0
15.0
15.0
25.0
30.0
30.0
20.0
25.0
20.0
TSL 5
(%)
20.0
15.0
15.0
15.0
30.0
28.0
29.4
20.0
20.0
20.0
20.0
30.0
39.3
34.9
25.0
30.0
20.0
21.3
16.4
16.7
15.5
31.3
28.0
29.4
20.0
20.6
20.6
20.5
30.2
39.3
34.9
31.0
30.2
28.2
* Percentage improvements for IMH–W–Large–B, IMH–A–Large–B and RCU–Large–B are a weighted average of the B1 and B2 units, using
weights provided in TSD chapter 7.
Table V.3 illustrates the design
options associated with each TSL level,
for each analyzed product class. The
design options are discussed in Section
IV.D.3 of today’s NOPR, and in Chapter
5 of the NOPR TSD.
TABLE V.3—DESIGN OPTIONS FOR ANALYZED PRODUCTS CLASSES AT EACH TSL
Equipment class
Baseline
TSL 1
TSL 2
TSL 3
TSL 4
TSL 5
Design Options for Each TSL (options are cumulative—TSL5 includes all preceding options)
No BW Fill, PSC
PM.
IMH–W–Med–B ...................
BW Fill, PSC
PM.
IMH–W–Large–B1 ...............
BW Fill, PSC
PM.
IMH–W–Large–B2 ...............
BW Fill, PSC
PM.
IMH–A–Small–B ..................
BW Fill, PSC
PM, SPM FM.
IMH–A–Large–B1 ................
IMH–A–Large–B2 ................
Increase Comp
EER, Increase
Cond.
Increase Comp
EER.
Same as previous.
Increase Cond,
BW Fill.
Same as previous.
Same as previous.
Same as previous.
Same as previous.
Increase Evap ...
BW Fill, PSC
PM, SPM FM.
Increase Comp
EER, Increase
Cond.
Increase Comp
EER, Increase
Cond.
Increase Comp
EER, Increase
Cond, Increase Evap.
PSC FM, Comp
EER.
Increase Comp
EER, Increase
Cond.
Same as previous.
RCU–Large–B1 ...................
BW Fill, PSC
PM, SPM FM.
BW Fill, PSC
PM, PSC FM.
Increase Comp
Same as preEER, PSC FM.
vious.
Increase Comp
Same as preEER.
vious.
RCU–Large–B2 ...................
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
IMH–W–Small–B .................
BW Fill, PSC
PM, PSC FM.
SCU–W–Large–B ................
No BW Fill, PSC
PM.
Increase Comp
EER, Increase
Cond.
BW Fill ..............
Increase Evap,
PSC FM, ECM
FM, Increase
Cond.
Increase Comp
EER, BW Fill,
ECM PM,
ECM FM, Increase Cond.
PSC FM, Increase Cond.
Increase Comp
EER, Increase
Cond, ECM
FM.
ECM PM Increase Cond.
SCU–A–Small–B .................
No BW Fill, PSC
PM, SPM FM.
PSC FM, Increase Cond.
SCU–A–Large–B .................
No BW Fill, PSC
PM, SPM FM.
Increase Comp
EER.
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Increase Comp
EER.
Same as previous.
BW Fill, Increase Increase Cond,
Comp EER,
ECM PM.
Increase Cond.
Increase Cond,
Increase Comp
Increase
EER, BW Fill.
Comp EER.
Increase Comp
BW Fill, PSC
EER, Increase
FM, ECM FM,
Cond, BW Fill.
ECM PM.
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BW Fill, Increase
Evap, ECM
PM.
Increase Comp
EER, ECM
PM, DWHX.
Increase Cond,
ECM PM,
DWHX.
ECM PM,
DWHX.
ECM PM,
DWHX.
Increase Cond,
ECM PM,
DWHX.
DWHX.
Increase Cond,
DWHX.
DWHX.
ECM FM, ECM
PM, DWHX.
ECM FM, Increase Cond,
ECM PM,
DWHX.
Increase Cond,
ECM FM,
DWHX.
ECM PM,
DWHX.
ECM FM, ECM
PM, DWHX.
DWHX.
BW Fill, ECM
PM, ECM FM,
DWHX.
ECM PM,
DWHX.
Same as previous.
17MRP2
DWHX.
DWHX.
DWHX.
DWHX.
DWHX.
Same as previous.
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TABLE V.3—DESIGN OPTIONS FOR ANALYZED PRODUCTS CLASSES AT EACH TSL—Continued
Equipment class
Baseline
TSL 1
TSL 2
TSL 3
IMH–A–Small–C ..................
PSC AM, SPM
FM.
PSC FM, Increase Comp
EER.
PSC FM, Increase Comp
EER.
IMH–A–Large–C ..................
PSC AM, SPM
FM.
Increase Comp
EER.
SCU–A–Small–C .................
PSC AM, SPM
FM.
Increase Cond,
Increase
Comp EER.
Increase Cond ..
Increase Cond,
Increase
Comp EER.
TSL 4
Increase Comp
ECM FM, ECM
EER, Increase
AM.
Cond, ECM
FM.
Increase Comp
ECM FM, ECM
EER, PSC
AM.
FM, ECM FM.
Increase Comp
Same as preEER, PSC FM.
vious.
TSL 5
ECM AM.
ECM AM.
ECM FM, ECM
AM.
SPM = Shaded Pole Motor
PSC = Permanent Split Capacitor Motor
ECM = Electronically Commutated Motor
FM = Fan Motor (Air-Cooled Units)
PM = Pump Motor (Batch Units)
AM = Auger Motor (Continuous Units)
BW Fill = Batch Water Fill Option Included
Increase Cond = Increase in Condenser Size
Increase Evap = Increase in Evaporator Size
Increase Comp EER = Increase in Compressor EER
DWHX = Addition of Drainwater Heat Exchanger
DOE requests comment and data
related to the required equipment size
increases associated with the design
options at each TSL levels. Chapter 5 of
the NOPR TSD contains full
descriptions of the design options and
DOE’s analyses for the equipment size
increase associated with the design
options selected. DOE also requests
comments and data on the efficiency
gains associated with each set of design
options. Chapter 5 of the NOPR TSD
contains DOE’s analyses of the
efficiency gains for each design option
considered. Finally, DOE requests
comment and data on any utility
impacts associated with each set of
design options, such as potential icestyle changes.
2. Trial Standard Level Equations
Table V.4 and Table V.5 translate the
TSLs into potential standards. In Table
V.4, the TSLs are translated into energy
consumption standards for the directly
analyzed (primary) equipment classes.
Table V.5. provides the equipment class
mapping showing which of the directly
analyzed standards’ results were used to
extend standards to secondary classes.
Table V.6 extends the standards to the
remaining (secondary) equipment
classes that have not been analyzed
directly.
TABLE V.4—POTENTIAL ENERGY CONSUMPTION STANDARDS FOR DIRECTLY ANALYZED CLASSES
TSL 1
TSL 2
TSL 3
TSL 4
TSL 5
IMH–W–Small–B ........................
IMH–W–Med–B ..........................
IMH–W–Large–B ........................
IMH–A–Small–B .........................
IMH–A–Large–B .........................
IMH–A–Extended–B ...................
7.01–0.0050H ........
5.04–0.0010H ........
3.6 ..........................
9.23–0.0077H ........
6.20–0.0010H ........
(>= 2,500 and
<4,000) 3.7;
5.84–0.0041H ........
3.98–0.0004H ........
3.4 ..........................
7.18–0.0060H ........
4.82–0.0008H ........
(>=815 and <2,455)
4.2; (>=2,455 and
<2,500) 6.89–
0.0011H; (>=
2,500) 4.1.
5.49–0.0039H.
3.63–0.0002H.
3.3.
7.05–0.0059H.
4.74–0.0008H.
(>=710 and <2,455)
4.2; (>=2,455 and
<2,500) 6.89–
0.0011H; (>=
2,500) 4.1.
4.6 ..........................
7.1 ..........................
16.74–0.0436H ......
9.1 ..........................
9.90–0.0057H ........
5.9 ..........................
10.70–0.0058H ......
6.62–0.0047H ........
4.65–0.0007H ........
3.6 ..........................
8.74–0.0073H ........
5.86–0.0009H ........
(>=1,240 and
<1,975) 4.7;
(>=1,975 and
<2,500) 6.89–
0.0011H; (>=
2,500) 4.1.
4.6 ..........................
6.5 ..........................
14.40–0.0375H ......
7.8 ..........................
9.35–0.0053H ........
5.6 ..........................
9.75–0.0053H ........
5.84–0.0041H ........
3.88–0.0002H ........
3.6 ..........................
7.70–0.0065H ........
5.17–0.0008H ........
(>=875 and <2,210)
4.5; (>=2,210 and
<2,500) 6.89–
0.0011H; (>=
2,500) 4.1.
RCU–NRC–Large–B ..................
SCU–W–Large–B .......................
SCU–A–Small–B ........................
SCU–A–Large–B ........................
IMH–A–Small–C .........................
IMH–A–Large–C ........................
SCU–A–Small–C ........................
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
Equipment class
4.3 ..........................
5.7 ..........................
12.6–0.0328H ........
6.9 ..........................
9.24–0.0061H ........
5.0 ..........................
9.20–0.0050H ........
4.1 ..........................
5.3 ..........................
10.34–0.0227H ......
6.4 ..........................
8.69–0.0058H ........
4.6 ..........................
9.20–0.0050H ........
4.1.
5.3.
10.34–0.0227H.
6.4.
7.55–0.0042H.
4.6.
8.26–0.0045H.
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Federal Register / Vol. 79, No. 51 / Monday, March 17, 2014 / Proposed Rules
TABLE V.5—DIRECTLY ANALYZED
EQUIPMENT CLASSES USED TO DEVELOP STANDARDS FOR SECONDARY
CLASSES
TABLE V.5—DIRECTLY ANALYZED
EQUIPMENT CLASSES USED TO DEVELOP STANDARDS FOR SECONDARY
CLASSES—Continued
Directly analyzed
product class associated
with efficiency level for
secondary product class
Secondary
equipment
class
RCU–NRC–Small–
B.
RCU–RC–Small–B
RCU–RC–Large–B
SCU–W–Small–B
IMH–W–Small–C ..
RCU–NRC–Large–B.
IMH–W–Large–C ..
RCU–NRC–Small–
C.
RCU–NRC–Large–
C.
RCU–NRC–Large–B.
RCU–NRC–Large–B.
SCU–W–Large–B.
IMH–A–Large–C.
TABLE V.5—DIRECTLY ANALYZED
EQUIPMENT CLASSES USED TO DEVELOP STANDARDS FOR SECONDARY
CLASSES—Continued
Directly analyzed
product class associated
with efficiency level for
secondary product class
Secondary
equipment
class
IMH–A–Large–C.
IMH–A–Large–C.
IMH–A–Large–C.
14913
Secondary
equipment
class
RCU–RC–Small–C
RCU–RC–Large–C
SCU–W–Small–C
SCU–W–Large–C
SCU–A–Large–C ..
Directly analyzed
product class associated
with efficiency level for
secondary product class
IMH–A–Large–C.
IMH–A–Large–C.
SCU–A–Small–C.
SCU–A–Small–C.
SCU–A–Small–C.
TABLE V.6—POTENTIAL ENERGY CONSUMPTION STANDARDS FOR SECONDARY CLASSES
TSL 1
TSL 2
TSL 3
TSL 4
RCU–NRC–Small–B ..................
RCU–RC–Small–B .....................
RCU–RC–Large–B .....................
SCU–W–Small–B .......................
IMH–W–Small–C ........................
IMH–W–Large–C .......................
RCU–NRC–Small–C ..................
RCU–NRC–Large–C ..................
RCU–RC–Small–C .....................
RCU–RC–Large–C ....................
SCU–W–Small–C .......................
SCU–W–Large–C ......................
SCU–A–Large–C .......................
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
Equipment class
8.04–0.0034H ........
8.02–0.0034H ........
4.8 ..........................
10.60–0.0177H ......
7.29–0.0030H ........
4.6 ..........................
9.00–0.0041H ........
5.5 ..........................
9.18–0.0041H ........
5.7 ..........................
8.46–0.0031H ........
5.7 ..........................
6.6 ..........................
8.04–0.0034H ........
8.02–0.0034H ........
4.8 ..........................
9.69–0.0162H ........
6.86–0.0028H ........
4.3 ..........................
8.50–0.0039H ........
5.2 ..........................
8.67–0.0039H ........
5.4 ..........................
7.74–0.0028H ........
5.2 ..........................
6.0 ..........................
7.52–0.0032H ........
7.52–0.0032H ........
4.5 ..........................
8.55–0.0143H ........
6.08–0.0025H ........
3.8 ..........................
7.5–0.0034H ..........
4.6 ..........................
7.65–0.0034H ........
4.8 ..........................
7.28–0.0027H ........
4.9 ..........................
5.7 ..........................
7.08–0.0030H ........
7.08–0.0030H ........
4.3 ..........................
7.98–0.0133H ........
5.67–0.0023H ........
3.6 ..........................
7.00–0.0032H ........
4.3 ..........................
7.14–0.0031H ........
4.5 ..........................
7.28–0.0027H ........
4.9 ..........................
5.7 ..........................
In developing TSLs, DOE analyzed
each equipment class separately, and
attributed a percentage reduction with
each portion of the standard curve
(small/medium/large). To ensure that
the standard curve remained connected
(no gaps at the breakpoints), DOE
developed a method for expressing the
consumption standards that relied on
pivoting the low-capacity equipment
classes about a representative point.
DOE was able to use the same
methodology for most equipment
classes, with exceptions for IMH–W–B,
IMH–A–B, and RCU–RC equipment
classes.
In drawing a relationship between the
harvest capacity (lb ice/24 hours) and
the maximum allowed energy usage
(kilowatt-hours per 100 lb of ice), DOE
first took the large-capacity equipment
class (which is set at a constant value
for all equipment types except IMH–A)
and applied the allocated percentage
reduction (percentage reduction
associated with the TSL for that
equipment class). For example, for
IMH–W–Large–B, the baseline level is
set at 4.0. If the TSL allocated a 10percent reduction for IMH–W–Large–B,
VerDate Mar<15>2010
19:08 Mar 14, 2014
Jkt 232001
then the next level was set at 4.0 × (1–
10 percent) = 3.6 kWh/100 lb of ice.
Then, for the small equipment classes,
DOE applied the allocated percentage
reduction at a designated median
capacity in that harvest rate range. The
medium capacity was selected based on
shipment levels, and where the median
fell within the shipments data. For
example, if the median capacity for the
small equipment class was at 300 lb ice/
24 hours, DOE would calculate the
baseline energy usage and then apply
the allocated percentage reduction to
obtain a point at 300 lb ice/24 hours.
DOE would then draw a line between
the start of the large equipment class
and this median capacity point to obtain
the equation for the small equipment
class, ensuring that there were no gaps
between small and large-capacity.
For the IMH–W–B equipment classes,
this equipment type has small, medium,
and large equipment classes. In this
case, for the small equipment class, DOE
applied the allocated percentage
reduction to the whole equation. So if
the percentage reduction was 10
percent, the new equation for the small
equipment class would be (1–10
PO 00000
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Fmt 4701
Sfmt 4702
TSL 5
7.05–0.0030H.
7.06–0.0030H.
4.3.
7.96–0.0133H.
5.65–0.0023H.
3.6.
6.98–0.0032H.
4.3.
7.12–0.0031H.
4.5.
6.53–0.0024H.
4.4.
5.1.
percent) × (7.80 ¥ 0.0055H) = 7.02 ¥
0.00495H. DOE would then draw a line
between the end of the small equipment
class and the start of the large
equipment class, to obtain the equation
for the medium equipment class.
For the IMH–A–B equipment classes,
DOE sought to obtain a constant
efficiency level for the largest
equipment classes. This calculation is
discussed in section IV.B.1.b.
For the RCU–RC–B and RCU–RC–C
equipment classes, DOE simply took the
standard levels calculated for the large
RCU–NRC–B and RCU–NRC–C
equipment classes, respectively, and
subtracted the 0.2 kWh/100 lb of ice
differential discussed in section
IV.B.1.e, to arrive at the standard levels.
For the small RCU classes, the remote
compressor standards were developed
such that no gap exists at the harvest
rate breakpoints.
Using the typical unit size for directly
analyzed equipment classes, the
potential standards shown on Table V.4,
DOE estimates energy usage for
equipment within each class to be as
shown on Table V.7.
E:\FR\FM\17MRP2.SGM
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Federal Register / Vol. 79, No. 51 / Monday, March 17, 2014 / Proposed Rules
TABLE V.7—ENERGY CONSUMPTION BY TSL FOR THE REPRESENTATIVE AUTOMATIC COMMERCIAL ICE MAKER UNITS
Energy consumption of the representative automatic
commercial ice maker unit
kWh/100 lb
Representative harvest rate
lb ice/24 hours
Equipment class
TSL 1
IMH–W–Small–B ...................................
IMH–W–Med–B .....................................
IMH–W–Large–B–1 ...............................
IMH–W–Large–B–2 ...............................
IMH–A–Small–B ....................................
IMH–A–Large–B–1 ................................
IMH–A–Large–B–2 ................................
RCU–Large–B–1 ...................................
RCU–Large–B–2 ...................................
SCU–W–Large–B ..................................
SCU–A–Small–B ...................................
SCU–A–Large–B ...................................
IMH–A–Small–C ....................................
IMH–A–Large–C ...................................
SCU–A–Small–C ...................................
300 .......................................
850 .......................................
1500 .....................................
2600 .....................................
300 .......................................
800 .......................................
1500 .....................................
1500 .....................................
2400 .....................................
300 .......................................
110 .......................................
200 .......................................
310 .......................................
820 .......................................
110 .......................................
B. Economic Justification and Energy
Savings
1. Economic Impacts on Commercial
Customers
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
a. Life-Cycle Cost and Payback Period
Customers affected by new or
amended standards usually incur higher
purchase prices and lower operating
costs. DOE evaluates these impacts on
individual customers by calculating
changes in LCC and the PBP associated
with the TSLs. The results of the LCC
analysis for each TSL were obtained by
comparing the installed and operating
costs of the equipment in the base-case
scenario (scenario with no amended
energy conservation standards) against
the standards-case scenarios at each
TSL. The energy consumption values for
both the base-case and standards-case
scenarios were calculated based on the
DOE test procedure conditions specified
in the 2012 test procedure final rule,
which adopts an industry-accepted test
method. Using the approach described
in section IV.G, DOE calculated the LCC
savings and PBPs for the TSLs
considered in this NOPR. The LCC
analysis is carried out in the form of
Monte Carlo simulations. Consequently,
the results of LCC analysis are
distributed over a range of values, as
opposed to a single deterministic value.
DOE presents the mean or median
values, as appropriate, calculated from
the distributions of results.
Table V.8 through Table V.25 show
the results of the LCC analysis for each
equipment class. Each table presents the
results of the LCC analysis, including
mean LCC, mean LCC savings, median
PBP, and distribution of customer
impacts in the form of percentages of
VerDate Mar<15>2010
19:08 Mar 14, 2014
Jkt 232001
TSL 2
5.5
4.2
3.6
3.6
6.9
5.4
3.7
4.6
4.6
7.1
11.9
9.1
8.1
5.9
10.1
customers who experience net cost, no
impact, or net benefit.
Only two equipment classes have
negative LCC savings values at TSL 5:
SCU–A–Small–C and IMH–A–Small–C.
Negative average LCC savings imply
that, on average, customers experience
an increase in LCC of the equipment as
a consequence of buying equipment
associated with that particular TSL. In
many cases, the TSL 5 level is not
negative, but the LCC savings are
sharply lower than the TSL 3 levels. For
IMH–W–Small–B, SCU–W–Large–B,
and SCU–A–Small–B, the TSL 5 LCC
savings are less than one-third the TSL
3 savings. In other cases, such as IMH–
W–Large–B2, IMH–A–Small–B, SCU–
A–Large–B, and IMH–A–Large–C, the
TSL 5 LCC savings are roughly one-half
of the TSL 3 LCC savings or less. All of
these results indicate the cost
increments associated with the maxtech design option are high, and the
increase in LCC (and corresponding
decrease in LCC savings) indicates that
this design option may result in
negative customer impacts. TSL 5 is
associated with the max-tech level for
all the equipment classes. Drain water
heat exchanger technology is the design
option associated with the max-tech
efficiency levels for batch equipment
classes. For continuous equipment
classes, the max-tech design options are
auger motors using permanent magnets.
The mean LCC savings associated
with TSL 4 are all positive values for all
equipment classes. The mean LCC
savings at all lower TSL levels are also
positive. The trend is generally an
increase in LCC savings for TSL 1
through 3, with LCC savings either
remaining constant or declining at TSL
4. In three cases, the highest LCC
PO 00000
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Fmt 4701
Sfmt 4702
TSL 3
5.2
4.0
3.6
3.6
6.5
5.1
4.7
4.6
4.6
6.5
10.3
7.8
7.7
5.6
9.2
TSL 4
4.6
3.7
3.6
3.6
5.8
4.5
4.5
4.3
4.3
5.7
9.0
6.9
7.3
5.0
8.7
TSL 5
4.6
3.6
3.4
3.4
5.4
4.2
4.2
4.1
4.1
5.3
7.8
6.4
6.9
4.6
8.7
4.3
3.5
3.3
3.3
5.3
4.1
4.2
4.1
4.1
5.3
7.8
6.4
6.2
4.6
7.8
savings are at TSL 2: IMH–A–Large–B2,
RCU–Large–B2, and SCU–A–Large–B.
The drop-off in LCC savings at TSL 4 is
generally associated with the relatively
large cost for the max-tech design
options, the savings for which
frequently span the last two efficiency
levels.
As described in section IV.H.2, DOE
used a ‘‘roll-up’’ scenario in this
rulemaking. Under the roll-up scenario,
DOE assumes that the market shares of
the efficiency levels (in the base case)
that do not meet the standard level
under consideration would be ‘‘rolled
up’’ into (meaning ‘‘added to’’) the
market share of the efficiency level at
the standard level under consideration,
and the market shares of efficiency
levels that are above the standard level
under consideration would remain
unaffected. Customers, in the base-case
scenario, who buy the equipment at or
above the TSL under consideration,
would be unaffected if the amended
standard were to be set at that TSL.
Customers, in the base-case scenario,
who buy equipment below the TSL
under consideration would be affected if
the amended standard were to be set at
that TSL. Among these affected
customers, some may benefit from lower
LCC of the equipment and some may
incur net cost due to higher LCC,
depending on the inputs to LCC analysis
such as electricity prices, discount rates,
installation costs, and markups. DOE’s
results indicate that, with one
exception, customers either benefit or
are unaffected by setting standards at
TSLs 1, 2, or 3, and at TSL 4 in the case
of SCU–A–Small–C. Customers either
benefit or are unaffected at all 5 TSLs in
the case of IMH–W–Large–B1. In the
case of IMH–W–Small–B, 3 percent of
E:\FR\FM\17MRP2.SGM
17MRP2
14915
Federal Register / Vol. 79, No. 51 / Monday, March 17, 2014 / Proposed Rules
customers are projected to experience a
net cost at TSL 3. A large percentage of
customers in batch equipment classes
are unaffected by a standard set at TSL
1 given the equivalence to ENERGY
STAR and the prevalence of ENERGY
STAR qualifying equipment in those
classes. At the other end of the range, in
almost all cases, a portion of the market
would experience net costs starting with
TSL 4, although generally the portion
experiencing a net cost is fairly low. At
TSL 5, the range is wide, with all
customers either unaffected or with a
net benefit for the IMH–W–Large–B1
typical unit at one extreme and 100
percent of customers with either a net
cost or unaffected for SCU–A–Small–C.
In the cases of nine of the 18 equipment
classes and/or typical unit sizes
modeled (12 classes plus 3 pairs of
typical units for large, batch type
equipment classes), 20 percent or more
of customers would experience a net
cost at TSL 5. In the other nine cases,
the percent of customers experiencing a
net cost at TSL 5 ranges from 0 to 16
percent, with the remaining customers
either unaffected or experiencing a net
benefit.
The median PBP values for TSLs 1
through 3 are all less than 2 years,
except for IMH–W–Small–B where the
TSL 3 PBP is 2.3 years. The median PBP
values for TSL 4 range from 1.9 years to
4.8 years.
PBP values for TSL 5 range from 2.2
years to over 19 years. SCU–A–Small–
C exhibits the longest PBP for TSL 5 at
19.1 years. IMH–A–Small–C has a PBP
of nearly 7 years, while IMH–W–Small–
B has a PBP over 5 years. IMH–A–
Small–B and SCU–A–Small–B both
PBPs at or above 4 years for TSL 5.
TABLE V.8—SUMMARY LCC AND PBP RESULTS FOR IMH–W–SMALL–B EQUIPMENT CLASS
Life-cycle cost, all customers 2012$
Energy
usage kWh/yr
TSL
1
2
3
4
5
..............................
..............................
..............................
..............................
..............................
Installed cost
3,052
2,884
2,547
2,547
2,400
Discounted
operating
cost
2,425
2,451
2,614
2,614
2,999
10,862
10,740
10,369
10,369
10,262
Life-cycle cost savings
Affected
customers’
average
savings
2012$
LCC
13,286
13,191
12,982
12,982
13,261
Payback
period,
median
years
% of customers that experience
Net cost
%
199
215
328
328
49
No impact
%
0
0
3
3
45
Net
benefit
%
61
35
0
0
0
39
65
97
97
55
1.1
1.3
2.3
2.3
5.4
TABLE V.9—SUMMARY LCC AND PBP RESULTS FOR IMH–W–MED–B EQUIPMENT CLASS
Life-cycle cost, all customers 2012$
Energy
usage kWh/yr
TSL
1
2
3
4
5
..............................
..............................
..............................
..............................
..............................
Installed cost
6,507
6,507
6,147
5,786
5,691
Discounted
operating
cost
4,241
4,241
4,286
4,656
4,671
24,859
24,859
24,601
24,341
24,272
Life-cycle cost savings
Affected
customers’
average
savings
2012$
LCC
29,100
29,100
28,887
28,997
28,943
Payback
period,
median
years
% of customers that experience
Net cost
%
464
464
587
405
460
No impact
%
0
0
0
15
11
Net
benefit
%
31
31
14
2
2
69
69
86
83
87
0.6
0.6
0.9
3.3
3.2
TABLE V.10—SUMMARY LCC AND PBP RESULTS FOR IMH–W–LARGE–B EQUIPMENT CLASS
Life-cycle cost, all customers 2012$
Energy
usage kWh/yr
TSL
1
2
3
4
5
..............................
..............................
..............................
..............................
..............................
Installed cost
11,585
11,585
11,585
10,943
10,783
Discounted
operating
cost
6,243
6,243
6,243
6,813
6,868
49,854
49,854
49,854
49,390
49,274
Life-cycle cost savings
Affected
customers’
average
savings
2012$
LCC
56,097
56,097
56,097
56,202
56,142
Payback
period,
median
years
% of customers that experience
Net cost
%
833
833
833
550
582
No impact
%
0
0
0
8
7
Net
benefit
%
38
38
38
26
22
62
62
62
66
71
0.7
0.7
0.7
3.6
3.6
TABLE V.11—SUMMARY LCC AND PBP RESULTS FOR IMH–W–LARGE–B1 EQUIPMENT CLASS
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
Life-cycle cost, all customers 2012$
Energy
usage kWh/yr
TSL
1
2
3
4
5
..............................
..............................
..............................
..............................
..............................
VerDate Mar<15>2010
Installed cost
9,877
9,877
9,877
9,329
9,147
19:08 Mar 14, 2014
Discounted
operating
cost
5,132
5,132
5,132
5,646
5,717
Jkt 232001
PO 00000
42,919
42,919
42,919
42,523
42,392
Frm 00071
Life-cycle cost savings
Affected
customers’
average
savings
2012$
LCC
48,051
48,051
48,051
48,170
48,109
Fmt 4701
Sfmt 4702
701
701
701
583
607
Payback
period,
median
years
% of customers that experience
Net cost
%
No impact
%
0
0
0
0
0
E:\FR\FM\17MRP2.SGM
29
29
29
29
24
17MRP2
Net
benefit
%
71
71
71
71
76
0.7
0.7
0.7
3.7
3.8
14916
Federal Register / Vol. 79, No. 51 / Monday, March 17, 2014 / Proposed Rules
TABLE V.12—SUMMARY LCC AND PBP RESULTS FOR IMH–W–LARGE–B2 EQUIPMENT CLASS
Life-cycle cost, all customers 2012$
Energy
usage kWh/yr
TSL
1
2
3
4
5
..............................
..............................
..............................
..............................
..............................
17,104
17,104
17,104
16,155
16,067
Installed cost
Discounted
operating
cost
9,833
9,833
9,833
10,581
10,587
72,254
72,254
72,254
71,569
71,506
Life-cycle cost savings
Affected
customers’
average
savings
2012$
LCC
82,087
82,087
82,087
82,150
82,093
Payback
period,
median
years
% of customers that experience
Net cost
%
1,260
1,260
1,260
442
500
No impact
%
0
0
0
35
29
Net
benefit
%
67
67
67
17
17
33
33
33
48
54
0.6
0.6
0.6
3.1
3.0
TABLE V.13—SUMMARY LCC AND PBP RESULTS FOR IMH–A–SMALL–B EQUIPMENT CLASS
Life-cycle cost, all customers 2012$
Energy
usage kWh/yr
TSL
1
2
3
4
5
..............................
..............................
..............................
..............................
..............................
Installed cost
3,806
3,596
3,176
2,965
2,909
Discounted
operating
cost
2,475
2,506
2,574
2,951
2,964
9,046
8,894
8,601
8,449
8,408
Life-cycle cost savings
Affected customers’ average savings
2012$
LCC
11,521
11,400
11,174
11,400
11,372
% of customers that experience
Net cost
%
254
259
396
170
198
No impact
%
0
0
0
27
22
Net benefit
%
63
32
0
0
0
37
68
100
73
78
Payback
period,
median
years
1.1
1.2
1.4
4.3
4.2
TABLE V.14—SUMMARY LCC AND PBP RESULTS FOR IMH–A–LARGE–B EQUIPMENT CLASS
Life-cycle cost, all customers 2012$
Energy
usage kWh/yr
TSL
1
2
3
4
5
..............................
..............................
..............................
..............................
..............................
Installed cost
8,704
8,334
7,482
7,041
7,041
Discounted
operating
cost
4,179
4,199
4,335
4,739
4,739
16,075
15,813
15,017
14,703
14,703
Life-cycle cost savings
Affected customers’ average savings
2012$
LCC
20,254
20,013
19,352
19,442
19,442
% of customers that experience
Net cost
%
648
633
1,127
994
994
No impact
%
0
0
0
4
4
Net benefit
%
60
23
6
2
2
40
77
94
94
94
Payback
period,
median
years
0.5
0.5
0.8
2.2
2.2
TABLE V.15—SUMMARY LCC AND PBP RESULTS FOR IMH–A–LARGE–B1 EQUIPMENT CLASS
Life-cycle cost, all customers 2012$
Energy
usage kWh/yr
TSL
1
2
3
4
5
..............................
..............................
..............................
..............................
..............................
Installed cost
7,919
7,480
6,603
6,213
6,213
Discounted
operating
cost
4,119
4,143
4,279
4,663
4,663
15,303
14,993
14,143
13,865
13,865
Life-cycle cost savings
Affected customers’ average savings
2012$
LCC
19,421
19,135
18,421
18,528
18,528
% of customers that experience
Net cost
%
590
572
1,168
1,062
1,062
No impact
%
0
0
0
1
1
Net benefit
%
59
15
0
0
0
41
85
100
99
99
Payback
period,
median
years
0.5
0.5
0.8
2.1
2.1
TABLE V.16—SUMMARY LCC AND PBP RESULTS FOR IMH–A–LARGE–B2 EQUIPMENT CLASS
Life-cycle cost, all customers 2012$
Energy
usage kWh/yr
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
TSL
1
2
3
4
5
..............................
..............................
..............................
..............................
..............................
VerDate Mar<15>2010
Installed cost
12,932
12,932
12,215
11,498
11,498
19:08 Mar 14, 2014
Discounted
operating
cost
4,505
4,505
4,641
5,151
5,151
Jkt 232001
PO 00000
20,234
20,234
19,725
19,217
19,217
Frm 00072
Life-cycle cost savings
Affected customers’ average savings
2012$
LCC
24,739
24,739
24,366
24,368
24,368
Fmt 4701
Sfmt 4702
960
960
908
627
627
% of customers that experience
Net cost
%
No impact
%
0
0
0
16
16
E:\FR\FM\17MRP2.SGM
67
67
40
13
13
17MRP2
Net benefit
%
33
33
60
70
70
Payback
period,
median
years
0.4
0.4
0.9
2.6
2.6
14917
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TABLE V.17—SUMMARY LCC AND PBP RESULTS FOR RCU–LARGE–B EQUIPMENT CLASS
Life-cycle cost, all customers 2012$
Energy
usage kWh/yr
TSL
1
2
3
4
5
..............................
..............................
..............................
..............................
..............................
Installed cost
13,205
13,205
12,335
11,611
11,526
Discounted
operating
cost
6,321
6,321
6,406
6,934
6,968
16,686
16,686
16,063
15,551
15,490
Life-cycle cost savings
Affected customers’ average savings
2012$
LCC
23,007
23,007
22,469
22,485
22,458
% of customers that experience
Net cost
%
875
875
983
870
897
No impact
%
0
0
0
6
5
Net benefit
%
58
58
18
10
10
42
42
82
85
85
Payback
period,
median
years
0.4
0.4
0.6
2.4
2.4
TABLE V.18—SUMMARY LCC AND PBP RESULTS FOR RCU–LARGE–B1 EQUIPMENT CLASS
Life-cycle cost, all customers 2012$
Energy
usage kWh/yr
TSL
1
2
3
4
5
..............................
..............................
..............................
..............................
..............................
Installed cost
12,727
12,727
11,889
11,191
11,108
Discounted
operating
cost
6,135
6,135
6,214
6,722
6,756
16,214
16,214
15,614
15,119
15,059
Life-cycle cost savings
Affected customers’ average savings
2012$
LCC
22,349
22,349
21,828
21,840
21,815
% of customers that experience
Net cost
%
847
847
963
857
882
No impact
%
0
0
0
6
5
Net benefit
%
57
57
18
9
9
43
43
82
85
86
Payback
period,
median
years
0.4
0.4
0.6
2.4
2.4
TABLE V.19—SUMMARY LCC AND PBP RESULTS FOR RCU–LARGE–B2 EQUIPMENT CLASS
Life-cycle cost, all customers 2012$
Energy
usage kWh/yr
TSL
1
2
3
4
5
..............................
..............................
..............................
..............................
..............................
20,349
20,349
19,009
17,892
17,779
Installed cost
Discounted
operating
cost
9,105
9,105
9,283
10,108
10,137
23,743
23,743
22,775
22,017
21,935
Life-cycle cost savings
Affected customers’ average savings
2012$
LCC
32,847
32,847
32,058
32,124
32,072
% of customers that experience
Net cost
%
1,298
1,298
1,277
1,070
1,123
No impact
%
0
0
0
7
6
Net benefit
%
73
73
27
18
18
27
27
73
75
76
Payback
period,
median
years
0.8
0.8
1.0
2.7
2.7
TABLE V.20—SUMMARY LCC AND PBP RESULTS FOR SCU–W–LARGE–B EQUIPMENT CLASS
Life-cycle cost, all customers 2012$
Energy
usage kWh/yr
TSL
1
2
3
4
5
..............................
..............................
..............................
..............................
..............................
Installed cost
3,892
3,559
3,143
2,935
2,925
Discounted
operating
cost
3,501
3,530
3,596
3,950
3,951
12,082
11,849
11,548
11,398
11,391
Life-cycle cost savings
Affected customers’ average savings
2012$
LCC
15,583
15,379
15,144
15,348
15,342
% of customers that experience
Net cost
%
483
687
694
143
149
No impact
%
0
0
0
49
49
Net benefit
%
71
71
57
14
14
29
29
43
36
37
Payback
period,
median
years
0.7
0.8
1.0
3.0
3.0
TABLE V.21—SUMMARY LCC AND PBP RESULTS FOR SCU–A–SMALL–B EQUIPMENT CLASS
Life-cycle cost, all customers 2012$
Energy
usage kWh/yr
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
TSL
1
2
3
4
5
..............................
..............................
..............................
..............................
..............................
VerDate Mar<15>2010
Installed cost
2,419
2,084
1,826
1,585
1,585
19:08 Mar 14, 2014
Discounted
operating
cost
2,772
2,821
2,896
3,306
3,306
Jkt 232001
PO 00000
7,548
7,320
6,979
6,813
6,813
Frm 00073
Life-cycle cost savings
Affected customers’ average savings
2012$
LCC
10,321
10,141
9,875
10,119
10,119
Fmt 4701
Sfmt 4702
103
198
396
106
106
% of customers that experience
Net cost
%
No impact
%
0
0
0
32
32
E:\FR\FM\17MRP2.SGM
83
37
11
0
0
17MRP2
Net benefit
%
17
63
89
68
68
Payback
period,
median
years
1.4
1.5
1.6
4.8
4.8
14918
Federal Register / Vol. 79, No. 51 / Monday, March 17, 2014 / Proposed Rules
TABLE V.22—SUMMARY LCC AND PBP RESULTS FOR SCU–A–LARGE–B EQUIPMENT CLASS
Life-cycle cost, all customers 2012$
Energy
usage kWh/yr
TSL
1
2
3
4
5
..............................
..............................
..............................
..............................
..............................
Installed cost
3,349
2,884
2,526
2,351
2,351
Discounted
operating
cost
3,243
3,324
3,405
3,758
3,758
10,645
10,105
9,857
9,731
9,731
Life-cycle cost savings
Affected customers’ average savings
2012$
LCC
13,888
13,429
13,262
13,489
13,489
% of customers that experience
Net cost
%
140
522
502
240
240
No impact
%
0
0
0
34
34
Net benefit
%
71
36
7
0
0
29
64
93
66
66
Payback
period,
median
years
1.4
1.2
1.5
3.7
3.7
TABLE V.23—SUMMARY LCC AND PBP RESULTS FOR IMH–A–SMALL–C EQUIPMENT CLASS
Life-cycle cost, all customers 2012$
Energy
usage kWh/yr
TSL
1
2
3
4
5
..............................
..............................
..............................
..............................
..............................
Installed cost
4,630
4,374
4,118
3,862
3,555
Discounted
operating
cost
6,644
6,666
6,694
6,913
7,461
9,390
9,212
9,031
8,848
8,789
Life-cycle cost savings
Affected customers’ average savings
2012$ *
LCC
16,034
15,877
15,726
15,761
16,251
% of customers that experience
Net cost
%
315
314
391
307
(237)
No impact
%
0
0
0
8
73
Net benefit
%
77
54
40
31
11
23
46
60
61
16
Payback
period,
median
years
0.9
0.9
1.0
2.6
6.8
* Values in parentheses are negative values.
TABLE V.24—SUMMARY LCC AND PBP RESULTS FOR IMH–A–LARGE–C EQUIPMENT CLASS
Life-cycle cost, all customers 2012$
Energy
usage kWh/yr
TSL
1
2
3
4
5
..............................
..............................
..............................
..............................
..............................
Installed cost
8,911
8,417
7,430
6,936
6,912
Discounted
operating
cost
5,518
5,543
5,630
6,288
6,289
15,462
15,113
14,426
14,269
14,262
Life-cycle cost savings
Affected customers’ average savings
2012$
LCC
20,980
20,656
20,055
20,557
20,552
% of customers that experience
Net cost
%
660
744
1,026
524
500
No impact
%
0
0
0
21
21
Net benefit
%
65
45
15
15
10
35
55
85
64
69
Payback
period,
median
years
0.5
0.5
0.7
3.2
3.2
TABLE V.25—SUMMARY LCC AND PBP RESULTS FOR SCU–A–SMALL–C EQUIPMENT CLASS
Life-cycle cost, all customers 2012$
Energy
usage kWh/yr
TSL
1
2
3
4
5
..............................
..............................
..............................
..............................
..............................
Installed cost
2,040
1,866
1,758
1,758
1,580
Discounted
operating
cost
3,603
3,632
3,659
3,659
4,196
7,243
7,127
7,057
7,057
7,099
Life-cycle cost savings
Affected customers’ average savings
2012$ *
LCC
10,846
10,760
10,717
10,717
11,295
% of customers that experience
Net cost
%
93
140
146
146
(441)
No impact
%
0
0
0
0
80
73
53
37
37
20
Net benefit
%
27
47
63
63
0
Payback
period,
median
years
1.1
1.5
1.9
1.9
19.1
* Values in parentheses are negative values.
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
b. Life-Cycle Cost Subgroup Analysis
As described in section IV.I, DOE
estimated the impact of amended energy
conservation standards for automatic
commercial ice makers, at each TSL, on
two customer subgroups—the
foodservice sector and the lodging
sector. For the automatic commercial ice
makers, DOE has not distinguished
between subsectors of the foodservice
industry. In other words, DOE has been
treating it as one sector as opposed to
modeling limited or full service
restaurants and other types of
foodservice firms separately.
VerDate Mar<15>2010
19:08 Mar 14, 2014
Jkt 232001
Foodservice was chosen as one
representative subgroup because of the
large percentage of the industry
represented by family or locally owned
restaurants. Likewise, lodging was
chosen due to the large percentage of
the industry represented by locally
owned, or franchisee-owned hotels.
DOE carried out two LCC subgroup
analyses, one each for restaurants and
lodging, by using the LCC spreadsheet
described in chapter 8 of the NOPR, but
with certain modifications. The input
for business type was fixed to the
identified subgroup, which ensured that
the discount rates and electricity price
PO 00000
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Fmt 4701
Sfmt 4702
rates associated with only that subgroup
were selected in the Monte Carlo
simulations (see chapter 8 of the NOPR
TSD). Another major change from the
LCC analysis was an added assumption
that the subgroups do not have access to
national capital markets, which results
in higher discount rates for the
subgroups. The higher discount rates
lead the subgroups valuing more highly
upfront equipment purchase costs
relative to the future operating cost
savings. The LCC subgroup analysis is
described in chapter 8 of the NOPR
TSD.
E:\FR\FM\17MRP2.SGM
17MRP2
14919
Federal Register / Vol. 79, No. 51 / Monday, March 17, 2014 / Proposed Rules
Table V.26 presents the comparison of
mean LCC savings for the small business
subgroup in foodservice sector with the
national average values (LCC savings
results from chapter 8 of the NOPR
TSD). For almost all TSLs in all
equipment classes, the LCC savings for
the small business subgroup are lower
than the national average values. The
exception is the TSL 5 result for SCU–
A–Small–C. Table V.27 presents the
percentage change in LCC savings
compared to national average values.
DOE modeled all equipment classes in
this analysis, although DOE believes it
is likely that the very large equipment
classes are not commonly used in
foodservice establishments. For TSLs 1
through 3, the differences range from
¥2 percent to ¥6 percent. For all but
three equipment classes in Table V.27,
the percentage decrease in LCC savings
is less than 10 percent for all TSLs. For
SCU–W–Large–B, the TSL 4 and 5
differences were ¥11 percent. SCU–A–
Small–B, the TSL 4 and 5 differences
were ¥17 percent. For IMH–W–Small–
B, the TSL 5 difference is ¥37 percent.
Table V.28 presents the comparison of
median PBPs for the small business
subgroup in foodservice sector with
national median values (median PBPs
from chapter 8 of the NOPR TSD). The
PBP values are shorter for the small
business subgroup in all cases. This
arises because the first-year operating
cost savings—which are used for
payback period—are higher leading to a
shorter payback, but given their higher
discount rates, these customers value
future savings less, leading to lower LCC
savings. First-year savings are higher
because the foodservice electricity
prices are higher than the average of all
classes.
Table V.29 presents the comparison of
mean LCC savings for the small business
subgroup in lodging sector (hotels and
casinos) with the national average
values (LCC savings results from chapter
8 of the NOPR TSD). Table V.30
presents the percentage change in LCC
savings of the lodging sector customer
subgroup to national average values. For
lodging sector small business, LCC
savings are lower across the board. For
TSLs 1 through 3, the lodging subgroup
LCC savings range from 9 to 13 percent
lower. The reason for this is that the
energy price for lodging is slightly lower
than the average of all commercial
business types (97 percent of the
average). This combined with a higher
discount rate reduces the nominal value
of future operating and maintenance
benefits as well as the present value of
the benefits, thus resulting in lower LCC
savings.
Table V.31 presents the comparison of
median PBPs for small business
subgroup in the lodging sector with
national median values (median PBPs
from chapter 8 of the NOPR TSD). The
PBP values are slightly higher in the
lodging small business subgroup in all
instances. As noted above, the energy
savings would be lower in nominal
terms than a national average Thus, the
slightly lower median PBP appears to be
a result of a narrower electricity saving
results distribution that is close to but
below the national average.
TABLE V.26—COMPARISON OF MEAN LCC SAVINGS FOR THE FOODSERVICE SECTOR SMALL BUSINESS SUBGROUP WITH
THE NATIONAL AVERAGE VALUES
Equipment class
Mean LCC savings
2012$ *
Category
TSL 1
IMH–W–Small–B .....................................
IMH–W–Med–B .......................................
IMH–W–Large–B ....................................
IMH–W–Large–B1 ..................................
IMH–W–Large–B2 ..................................
IMH–A–Small–B ......................................
IMH–A–Large–B .....................................
IMH–A–Large–B1 ...................................
IMH–A–Large–B2 ...................................
RCU–Large–B .........................................
RCU–Large–B1 .......................................
RCU–Large–B2 .......................................
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
SCU–W–Large–B ...................................
SCU–A–Small–B .....................................
SCU–A–Large–B ....................................
IMH–A–Small–C .....................................
IMH–A–Large–C .....................................
SCU–A–Small–C ....................................
VerDate Mar<15>2010
19:08 Mar 14, 2014
Jkt 232001
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
PO 00000
Frm 00075
Fmt 4701
Sfmt 4702
TSL 2
TSL 3
TSL 4
TSL 5
195
199
455
464
816
833
687
701
1,233
1,260
249
254
635
648
578
590
941
960
858
875
830
847
1,270
1,298
455
483
100
103
137
140
308
315
647
660
91
210
215
455
464
816
833
687
701
1,233
1,260
253
259
621
633
561
572
941
960
858
875
830
847
1,270
1,298
655
687
194
198
498
522
307
314
729
744
137
312
328
575
587
816
833
687
701
1,233
1,260
387
396
1,094
1,127
1,132
1,168
888
908
963
983
944
963
1,249
1,277
666
694
378
396
483
502
383
391
1,006
1,026
143
312
328
390
405
528
550
561
583
419
442
159
170
956
994
1,021
1,062
604
627
843
870
831
857
1,032
1,070
126
143
88
106
219
240
296
307
512
524
143
31
49
443
460
559
582
585
607
476
500
185
198
956
994
1,021
1,062
604
627
869
897
855
882
1,084
1,123
132
149
88
106
219
240
(238)
(237)
489
500
(434)
E:\FR\FM\17MRP2.SGM
17MRP2
14920
Federal Register / Vol. 79, No. 51 / Monday, March 17, 2014 / Proposed Rules
TABLE V.26—COMPARISON OF MEAN LCC SAVINGS FOR THE FOODSERVICE SECTOR SMALL BUSINESS SUBGROUP WITH
THE NATIONAL AVERAGE VALUES—Continued
Equipment class
Mean LCC savings
2012$ *
Category
TSL 1
TSL 3
TSL 4
TSL 5
93
All Business Types .................................
TSL 2
140
146
146
(441)
* Values in parenthesis are negative numbers.
TABLE V.27—PERCENTAGE CHANGE IN MEAN LCC SAVINGS FOR THE FOODSERVICE SECTOR SMALL BUSINESS
SUBGROUP COMPARED TO NATIONAL AVERAGE VALUES *
Equipment class
TSL 1
IMH–W–Small–B ......................................................................................
IMH–W–Med–B ........................................................................................
IMH–W–Large–B ......................................................................................
IMH–W–Large–B1 ...................................................................................
IMH–W–Large–B2 ...................................................................................
IMH–A–Small–B .......................................................................................
IMH–A–Large–B ......................................................................................
IMH–A–Large–B1 ....................................................................................
IMH–A–Large–B2 ....................................................................................
RCU–Large–B ..........................................................................................
RCU–Large–B1 ........................................................................................
RCU–Large–B2 ........................................................................................
SCU–W–Large–B .....................................................................................
SCU–A–Small–B ......................................................................................
SCU–A–Large–B .....................................................................................
IMH–A–Small–C ......................................................................................
IMH–A–Large–C ......................................................................................
SCU–A–Small–C ......................................................................................
TSL 2
(2%)
(2%)
(2%)
(2%)
(2%)
(2%)
(2%)
(2%)
(2%)
(2%)
(2%)
(2%)
(6%)
(2%)
(2%)
(2%)
(2%)
(2%)
TSL 3
(2%)
(2%)
(2%)
(2%)
(2%)
(2%)
(2%)
(2%)
(2%)
(2%)
(2%)
(2%)
(5%)
(2%)
(4%)
(2%)
(2%)
(2%)
TSL 4
(5%)
(2%)
(2%)
(2%)
(2%)
(2%)
(3%)
(3%)
(2%)
(2%)
(2%)
(2%)
(4%)
(5%)
(4%)
(2%)
(2%)
(2%)
TSL 5
(5%)
(4%)
(4%)
(4%)
(5%)
(7%)
(4%)
(4%)
(4%)
(3%)
(3%)
(3%)
(11%)
(17%)
(9%)
(3%)
(2%)
(2%)
(37%)
(4%)
(4%)
(4%)
(5%)
(6%)
(4%)
(4%)
(4%)
(3%)
(3%)
(3%)
(11%)
(17%)
(9%)
0%
(2%)
2%
* Values in parenthesis are negative numbers. Negative percentage values imply decrease in LCC savings and positive percentage values
imply increase in LCC savings.
TABLE V.28—COMPARISON OF MEDIAN PAYBACK PERIODS FOR THE FOODSERVICE SECTOR SMALL BUSINESS SUBGROUP
WITH NATIONAL MEDIAN VALUES
Equipment class
Median payback period
years
Category
TSL 1
IMH–W–Small–B .....................................
IMH–W–Med–B .......................................
IMH–W–Large–B ....................................
IMH–W–Large–B1 ..................................
IMH–W–Large–B2 ..................................
IMH–A–Small–B ......................................
IMH–A–Large–B .....................................
IMH–A–Large–B1 ...................................
IMH–A–Large–B2 ...................................
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
RCU–Large–B .........................................
RCU–Large–B1 .......................................
RCU–Large–B2 .......................................
SCU–W–Large–B ...................................
SCU–A–Small–B .....................................
SCU–A–Large–B ....................................
VerDate Mar<15>2010
19:08 Mar 14, 2014
Jkt 232001
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
PO 00000
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Fmt 4701
Sfmt 4702
1.02
1.07
0.60
0.63
0.65
0.69
0.68
0.72
0.55
0.58
1.02
1.07
0.44
0.46
0.44
0.46
0.40
0.42
0.39
0.41
0.37
0.38
0.72
0.75
0.65
0.67
1.33
1.40
1.29
TSL 2
TSL 3
1.20
1.26
0.60
0.63
0.65
0.69
0.68
0.72
0.55
0.58
1.16
1.22
0.47
0.49
0.48
0.50
0.40
0.42
0.39
0.41
0.37
0.38
0.72
0.75
0.73
0.76
1.44
1.52
1.11
E:\FR\FM\17MRP2.SGM
17MRP2
2.16
2.27
0.81
0.85
0.65
0.69
0.68
0.72
0.55
0.58
1.35
1.42
0.80
0.84
0.78
0.82
0.90
0.94
0.62
0.65
0.59
0.62
0.96
1.00
0.96
1.00
1.48
1.56
1.42
TSL 4
2.16
2.27
3.17
3.33
3.42
3.59
3.57
3.75
2.95
3.10
4.11
4.32
2.06
2.16
1.99
2.08
2.45
2.58
2.27
2.39
2.25
2.37
2.57
2.70
2.87
3.01
4.54
4.79
3.54
TSL 5
5.14
5.42
3.06
3.22
3.42
3.60
3.59
3.77
2.88
3.02
4.03
4.24
2.06
2.16
1.99
2.08
2.45
2.58
2.32
2.44
2.31
2.42
2.57
2.70
2.86
3.00
4.54
4.79
3.54
14921
Federal Register / Vol. 79, No. 51 / Monday, March 17, 2014 / Proposed Rules
TABLE V.28—COMPARISON OF MEDIAN PAYBACK PERIODS FOR THE FOODSERVICE SECTOR SMALL BUSINESS SUBGROUP
WITH NATIONAL MEDIAN VALUES—Continued
Equipment class
Median payback period
years
Category
TSL 1
IMH–A–Small–C .....................................
IMH–A–Large–C .....................................
SCU–A–Small–C ....................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
TSL 2
1.37
0.86
0.90
0.50
0.52
1.08
1.13
TSL 3
1.17
0.86
0.90
0.50
0.53
1.45
1.53
TSL 4
1.49
0.92
0.97
0.65
0.69
1.76
1.85
3.72
2.46
2.59
3.06
3.25
1.76
1.85
TSL 5
3.72
6.38
6.83
3.05
3.24
17.09
19.12
TABLE V.29—COMPARISON OF LCC SAVINGS FOR THE LODGING SECTOR SMALL BUSINESS SUBGROUP WITH THE
NATIONAL AVERAGE VALUES
Equipment class
Mean LCC savings
2012$ *
Category
TSL 1
IMH–W–Small–B .....................................
IMH–W–Med–B .......................................
IMH–W–Large–B ....................................
IMH–W–Large–B1 ..................................
IMH–W–Large–B2 ..................................
IMH–A–Small–B ......................................
IMH–A–Large–B .....................................
IMH–A–Large–B1 ...................................
IMH–A–Large–B2 ...................................
RCU–Large–B .........................................
RCU–Large–B1 .......................................
RCU–Large–B2 .......................................
SCU–W–Large–B ...................................
SCU–A–Small–B .....................................
SCU–A–Large–B ....................................
IMH–A–Small–C .....................................
IMH–A–Large–C .....................................
SCU–A–Small–C ....................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
TSL 2
179
199
421
464
756
833
635
701
1,144
1,260
229
254
589
648
536
590
873
960
796
875
771
847
1,175
1,298
440
483
92
103
126
140
284
315
600
660
84
93
TSL 3
192
215
421
464
756
833
635
701
1,144
1,260
232
259
575
633
520
572
873
960
796
875
771
847
1,175
1,298
624
687
177
198
470
522
283
314
676
744
125
140
TSL 4
285
328
531
587
756
833
635
701
1,144
1,260
354
396
1,018
1,127
1,056
1,168
816
908
890
983
873
963
1,149
1,277
626
694
353
396
448
502
352
391
929
1,026
128
146
285
328
334
405
449
550
484
583
338
442
115
170
862
994
926
1,062
521
627
744
870
734
857
891
1,070
96
143
55
106
179
240
257
307
412
524
128
146
TSL 5
(3)
49
382
460
476
582
503
607
390
500
139
198
862
994
926
1,062
521
627
766
897
754
882
937
1,123
102
149
55
106
179
240
(281)
(237)
394
500
(452)
(441)
* Values in parentheses are negative numbers.
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
TABLE V.30—PERCENTAGE CHANGE IN MEAN LCC SAVINGS FOR THE LODGING SECTOR SMALL BUSINESS SUBGROUP
COMPARED TO NATIONAL AVERAGE VALUES *
Equipment class
TSL 1
IMH–W–Small–B ......................................................................................
IMH–W–Med–B ........................................................................................
IMH–W–Large–B ......................................................................................
IMH–W–Large–B1 ...................................................................................
IMH–W–Large–B2 ...................................................................................
IMH–A–Small–B .......................................................................................
IMH–A–Large–B ......................................................................................
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TSL 2
(10%)
(9%)
(9%)
(9%)
(9%)
(10%)
(9%)
Sfmt 4702
(10%)
(9%)
(9%)
(9%)
(9%)
(10%)
(9%)
E:\FR\FM\17MRP2.SGM
TSL 3
(13%)
(10%)
(9%)
(9%)
(9%)
(11%)
(10%)
17MRP2
TSL 4
(13%)
(18%)
(18%)
(17%)
(24%)
(32%)
(13%)
TSL 5
(107%)
(17%)
(18%)
(17%)
(22%)
(30%)
(13%)
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TABLE V.30—PERCENTAGE CHANGE IN MEAN LCC SAVINGS FOR THE LODGING SECTOR SMALL BUSINESS SUBGROUP
COMPARED TO NATIONAL AVERAGE VALUES *—Continued
Equipment class
TSL 1
IMH–A–Large–B1 ....................................................................................
IMH–A–Large–B2 ....................................................................................
RCU–Large–B ..........................................................................................
RCU–Large–B1 ........................................................................................
RCU–Large–B2 ........................................................................................
SCU–W–Large–B .....................................................................................
SCU–A–Small–B ......................................................................................
SCU–A–Large–B .....................................................................................
IMH–A–Small–C ......................................................................................
IMH–A–Large–C ......................................................................................
SCU–A–Small–C ......................................................................................
TSL 2
(9%)
(9%)
(9%)
(9%)
(9%)
(9%)
(11%)
(10%)
(10%)
(9%)
(10%)
TSL 3
(9%)
(9%)
(9%)
(9%)
(9%)
(9%)
(11%)
(10%)
(10%)
(9%)
(11%)
TSL 4
(10%)
(10%)
(9%)
(9%)
(10%)
(10%)
(11%)
(11%)
(10%)
(9%)
(12%)
TSL 5
(13%)
(17%)
(15%)
(14%)
(17%)
(33%)
(49%)
(25%)
(16%)
(21%)
(12%)
(13%)
(17%)
(15%)
(15%)
(16%)
(32%)
(49%)
(25%)
(18%)
(21%)
(2%)
* Values in parentheses are negative numbers. Negative percentage values imply decrease in LCC savings and positive percentage values
imply increase in LCC savings.
TABLE V.31—COMPARISON OF MEDIAN PAYBACK PERIODS FOR THE LODGING SECTOR SMALL BUSINESS SUBGROUP WITH
THE NATIONAL MEDIAN VALUES
Equipment class
Median payback period
years
Category
TSL 1
IMH–W–Small–B .....................................
IMH–W–Med–B .......................................
IMH–W–Large–B ....................................
IMH–W–Large–B1 ..................................
IMH–W–Large–B2 ..................................
IMH–A–Small–B ......................................
IMH–A–Large–B .....................................
IMH–A–Large–B1 ...................................
IMH–A–Large–B2 ...................................
RCU–Large–B .........................................
RCU–Large–B1 .......................................
RCU–Large–B2 .......................................
SCU–W–Large–B ...................................
SCU–A–Small–B .....................................
SCU–A–Large–B ....................................
IMH–A–Small–C .....................................
IMH–A–Large–C .....................................
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
SCU–A–Small–C ....................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
Small Business .......................................
All Business Types .................................
2. Economic Impacts on Manufacturers
DOE performed an MIA to estimate
the impact of amended energy
conservation standards on
manufacturers of automatic commercial
ice makers. The following section
describes the expected impacts on
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1.09
1.07
0.64
0.63
0.70
0.69
0.73
0.72
0.58
0.58
1.08
1.07
0.46
0.46
0.47
0.46
0.43
0.42
0.41
0.41
0.39
0.38
0.77
0.75
0.67
0.67
1.42
1.40
1.38
1.37
0.92
0.90
0.53
0.52
1.15
1.13
manufacturers at each TSL. Chapter 12
of the NOPR TSD explains the analysis
in further detail.
a. Industry Cash Flow Analysis Results
The following tables depict the
financial impacts (represented by
changes in INPV) of amended energy
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TSL 2
TSL 3
1.28
1.26
0.64
0.63
0.70
0.69
0.73
0.72
0.58
0.58
1.24
1.22
0.50
0.49
0.51
0.50
0.43
0.42
0.41
0.41
0.39
0.38
0.77
0.75
0.75
0.76
1.54
1.52
1.17
1.17
0.92
0.90
0.53
0.53
1.55
1.53
2.27
2.27
0.86
0.85
0.70
0.69
0.73
0.72
0.58
0.58
1.44
1.42
0.85
0.84
0.83
0.82
0.96
0.94
0.66
0.65
0.63
0.62
1.02
1.00
1.01
1.00
1.56
1.56
1.49
1.49
0.99
0.97
0.70
0.69
1.88
1.85
TSL 4
2.27
2.27
3.38
3.33
3.65
3.59
3.80
3.75
3.14
3.10
4.39
4.32
2.19
2.16
2.11
2.08
2.61
2.58
2.42
2.39
2.40
2.37
2.74
2.70
3.01
3.01
4.79
4.79
3.72
3.72
2.63
2.59
3.28
3.25
1.88
1.85
TSL 5
5.42
5.42
3.26
3.22
3.65
3.60
3.83
3.77
3.07
3.02
4.30
4.24
2.19
2.16
2.11
2.08
2.61
2.58
2.48
2.44
2.46
2.42
2.74
2.70
3.00
3.00
4.79
4.79
3.72
3.72
6.88
6.83
3.28
3.24
19.13
19.12
conservation standards on
manufacturers of automatic commercial
ice makers as well as the conversion
costs that DOE estimates manufacturers
would incur for all equipment classes at
each TSL. To evaluate the range of cash
flow impacts on the commercial ice
maker industry, DOE used two different
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markup assumptions to model scenarios
that correspond to the range of
anticipated market responses to new
and amended energy conservation
standards.
To assess the lower (less severe) end
of the range of potential impacts, DOE
modeled a preservation of gross margin
percentage markup scenario, in which a
uniform ‘‘gross margin percentage’’
markup is applied across all efficiency
levels. In this scenario, DOE assumed
that a manufacturer’s absolute dollar
markup would increase as production
costs increase in the amended energy
conservation standards case.
Manufacturers have indicated that it is
optimistic to assume that they would be
able to maintain the same gross margin
percentage markup as their production
costs increase in response to a new or
amended energy conservation standard,
particularly at higher TSLs.
To assess the higher (more severe) end
of the range of potential impacts, DOE
modeled the preservation of the EBIT
markup scenario, which assumes that
manufacturers would not be able to
preserve the same overall gross margin,
but instead cut their markup for
marginally compliant products to
maintain a cost competitive product
offering and keep the same overall level
of EBIT as in the base case. The two
tables below show the range of potential
INPV impacts for manufacturers of
automatic commercial ice makers. The
first table reflects the lower bound of
impacts (higher profitability) and the
second represents the upper bound of
impacts (lower profitability).
Each scenario results in a unique set
of cash flows and corresponding
industry values at each TSL. In the
following discussion, the INPV results
refer to the sum of discounted cash
flows through 2047, the difference in
INPV between the base case and each
standards case, and the total industry
conversion costs required for each
standards case.
TABLE V.32—MANUFACTURER IMPACT ANALYSIS FOR AUTOMATIC COMMERCIAL ICE MAKERS—PRESERVATION OF GROSS
MARGIN PERCENTAGE MARKUP SCENARIO *
Base
case
Units
INPV .............................................
Change in INPV ............................
Trial standard level
1
2
3
4
5
Product Conversion Costs ............
Capital Conversion Costs .............
2012$ Millions ...............................
2012$ Millions ...............................
(%) ................................................
2012$ Millions ...............................
2012$ Millions ...............................
$101.8
................
................
................
................
$93.4
$(8.4)
(8.2)%
$17.0
$0.4
$89.0
$(12.8)
(12.6)%
$25.4
$1.2
$80.9
$(20.9)
(20.5)%
$38.3
$3.9
$82.2
$(19.6)
(19.2)%
$44.8
$6.4
$81.9
$(19.9)
(19.5)%
$46.9
$7.3
Total Conversion Costs .........
2012$ Millions ...............................
................
$17.4
$26.6
$42.2
$51.2
$54.2
* Values in parentheses are negative numbers.
TABLE V.33—MANUFACTURER IMPACT ANALYSIS FOR AUTOMATIC COMMERCIAL ICE MAKERS—PRESERVATION OF EBIT
MARKUP SCENARIO *
Base
case
Units
INPV .............................................
Change in INPV ............................
Trial standard level
1
2
3
4
5
Product Conversion Costs ............
Capital Conversion Costs .............
2012$ Millions ...............................
2012$ Millions ...............................
(%) ................................................
2012$ Millions ...............................
2012$ Millions ...............................
$101.8
................
................
................
................
$93.1
$(8.7)
(8.5)%
$17.0
$0.4
$88.2
$(13.6)
(13.4)%
$25.4
$1.2
$77.9
$(23.9)
(23.5)%
$38.3
$3.9
$71.3
$(30.5)
(30.0)%
$44.8
$6.4
$69.2
$(32.6)
(32.0)%
$46.9
$7.3
Total Conversion Costs .........
2012$ Millions ...............................
................
$17.4
$26.6
$42.2
$51.2
$54.2
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
* Values in parentheses are negative numbers.
Beyond impacts on INPV, DOE
includes a comparison of free cash flow
between the base case and the standards
case at each TSL in the year before
amended standards take effect to
provide perspective on the short-run
cash flow impacts in the discussion of
the results below.
At TSL 1, DOE estimates impacts on
INPV for manufacturers of automatic
commercial ice makers to range from
¥$8.4 million to ¥$8.7 million, or a
change in INPV of ¥8.2 percent to ¥8.5
percent. At this TSL, industry free cash
flow is estimated to decrease by
approximately 61 percent to $3.3
million, compared to the base-case
value of $8.4 million in the year before
the compliance date (2017).
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DOE estimates that approximately 40
percent of all batch commercial ice
makers and 30 percent of all continuous
commercial ice makers on the market
will require redesign to meet standards
at TSL 1. Additionally, for both batch
and continuous products, the number of
products requiring redesign at this TSL
is commensurate with each
manufacturer’s estimated market share.
Twelve manufacturers, including three
small businesses, produce equipment
that complies with the efficiency levels
specified at TSL 1.
At TSL 1, the majority of efficiency
gains could be made through swapping
purchased components for higher
efficiency equivalents. It is expected
that very few evaporators and
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condensers are affected at TSL 1,
leading to very low expected industry
capital conversion costs totaling only
$0.4 million. However, moderate
product conversion costs of $17.0
million are expected, as redesigned
units will require low levels of
engineering design labor, as well as
testing for equipment certification.
At TSL 2, DOE estimates impacts on
INPV for manufacturers of automatic
commercial ice makers to range from
¥$12.8 million to ¥$13.6 million, or a
change in INPV of ¥12.6 percent to
¥13.4 percent. At this TSL, industry
free cash flow is estimated to decrease
by approximately 97 percent to $0.2
million, compared to the base-case
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value of $8.4 million in the year before
the compliance date (2017).
At TSL 2, total conversion costs
increase to $26.6 million, 53 percent
higher than those incurred by industry
at TSL 1. DOE estimates that
approximately 58 percent of all units on
the market will require redesign to meet
the standards outlined at TSL 2. As with
TSL 1, for batch and continuous
commercial ice makers, the number of
products requiring redesign at this TSL
is largely commensurate with each
manufacturer’s estimated market share.
Ten manufacturers, including three
small businesses, produce equipment
that complies with the efficiency levels
specified at TSL 2.
The majority of redesigns still rely on
switching to higher efficiency
components, but a limited number of
units are expected to require more
complex system redesigns including the
evaporator and condenser. The
increased, but moderate, complexity of
these redesigns causes product
conversion costs to grow at a slightly
higher rate than the additional number
of units requiring redesign, resulting in
industry-wide product conversion costs
totaling $25.4 million. Capital
conversion costs continue to remain
relatively low at $1.2 million, as most
design options considered at TSL 2 can
be integrated into production without
changes to manufacturing capital.
At TSL 3, DOE estimates impacts on
INPV for manufacturers of automatic
commercial ice makers to range from
¥$20.9 million to ¥$23.9 million, or a
change in INPV of ¥20.5 percent to
¥23.5 percent. At this TSL, industry
free cash flow is estimated to decrease
by approximately 180 percent to ¥$6.7
million, compared to the base-case
value of $8.4 million in the year before
the compliance date (2017).
At TSL 3, total conversion costs grow
significantly to $42.2 million, an
increase of 59 percent over those
incurred by manufacturers at TSL 2.
DOE estimates that approximately 88
percent of all batch products and 75
percent of all continuous products on
the market will require redesign to meet
this TSL. Six of the 12 manufacturers of
batch equipment currently produce
batch commercial ice makers that
comply with the efficiency levels
specified at TSL 3. This includes one
small business manufacturer. In
contrast, all six manufacturers of
continuous commercial ice makers
identified produce products that comply
with the efficiency levels specified at
TSL 3.
The majority of redesigns necessary to
meet the standards at TSL 3 involve
more complex changes to the evaporator
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and condenser systems. These complex
redesigns result in product conversion
costs increasing at a rate higher than
simply the additional number of units
that require redesign. At TSL 3, the
resulting industry product conversion
costs total $38.3 million. Additionally,
capital conversion costs jump
significantly to $3.9 million, as
evaporator and condenser redesigns
spur investments in tooling for both of
these components and the surrounding
enclosure.
At TSL 4, DOE estimates impacts on
INPV for manufacturers of automatic
commercial ice makers to range from
¥$19.6 million to ¥$30.5 million, or a
change in INPV of ¥19.2 percent to
¥30.0 percent. At this TSL, industry
free cash flow is estimated to decrease
by approximately 227 percent to ¥$10.7
million, compared to the base-case
value of $8.4 million in the year before
the compliance date (2017).
At TSL 4, total conversion costs grow
to $51.2 million. Relative to the change
between TSLs 2 and 3, the increases in
conversion costs at TSL 4 are smaller as
the percentage of batch and continuous
units requiring redesign grows to 96
percent and 77 percent, respectively.
These fractions are up from 88 percent
and 75 percent, respectively, at TSL 3.
Only two manufacturers, including one
small business manufacturer, currently
produce batch commercial ice makers
that comply with the efficiency levels
specified at TSL 4. In contrast, all six
manufacturers of continuous
commercial ice makers identified
produce products that comply with the
efficiency levels specified at TSL 4.
With very few additional units
needing redesigns, costs incurred are
mainly incremental, and account for the
increasing complexity of condenser and
evaporator redesigns. Product
conversion costs grow to $44.8 million,
17 percent above those at TSL 3.
However, the increasing complexity of
redesign does incur greater capital
conversion costs, which grow to $6.4
million as additional capital
investments are required to modify
production lines to manufacture these
more complex designs.
At TSL 5, DOE estimates impacts on
INPV for manufacturers of automatic
commercial ice makers to range from
¥$19.9 million to ¥$32.6 million, or a
change in INPV of ¥19.5 percent to
¥32.0 percent. At this TSL, industry
free cash flow is estimated to decrease
by approximately 243 percent to ¥$12.0
million, compared to the base-case
value of $8.4 million in the year before
the compliance date (2017).
As with TSL 4, only two
manufacturers, including one small
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business manufacturer, currently
produce batch commercial ice makers
that comply with the efficiency levels
specified at TSL 5. For manufacturers of
continuous commercial ice makers, this
number drops from six to four. As
compared to the previous increases in
required efficiency between TSLs, the
changes between TSL 4 and TSL 5 are
minimal. As a result, total conversion
costs grow only slightly, rising 6 percent
to $54.2 million. This consists of $46.9
million in product conversion costs and
$7.3 million in capital conversion costs.
b. Impacts on Direct Employment
DOE used the GRIM to estimate the
domestic labor expenditures and
number of domestic production workers
in the base case and at each TSL from
2013 to 2047. DOE used statistical data
from the most recent U.S Census
Bureau’s ‘‘Annual Survey of
Manufactures,’’ the results of the
engineering analysis, and interviews
with manufacturers to determine the
inputs necessary to calculate industrywide labor expenditures and domestic
employment levels. Labor expenditures
for the manufacture of a product are a
function of the labor intensity of the
product, the sales volume, and an
assumption that wages in real terms
remain constant.
In the GRIM, DOE used the labor
content of each product and the
manufacturing production costs from
the engineering analysis to estimate the
annual labor expenditures in the
automatic commercial ice maker
industry. DOE used information gained
through interviews with manufacturers
to estimate the portion of the total labor
expenditures that is attributable to
domestic labor.
The production worker estimates in
this section cover workers only up to
the line-supervisor level who are
directly involved in fabricating and
assembling automatic commercial ice
makers within an original equipment
manufacturer (OEM) facility. Workers
performing services that are closely
associated with production operations,
such as material handling with a
forklift, are also included as production
labor.
The employment impacts shown in
Table V.34 represent the potential
production employment that could
result following new and amended
energy conservation standards. The
upper end of the results in this table
estimates the total potential increase in
the number of production workers after
amended energy conservation
standards. To calculate the total
potential increase, DOE assumed that
manufacturers continue to produce the
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same scope of covered products in
domestic production facilities and
domestic production is not shifted to
lower-labor-cost countries. Because
there is a risk of manufacturers
evaluating sourcing decisions in
response to amended energy
conservation standards, the lower end of
the range of employment results in
Table V.34 includes the estimated total
number of U.S. production workers in
the industry who could lose their jobs
if all existing production were moved
outside of the United States. While the
results present a range of employment
impacts following the compliance date
of amended energy conservation
standards, the discussion below also
includes a qualitative discussion of the
likelihood of negative employment
impacts at the various TSLs. Finally, the
employment impacts shown are
independent of the employment impacts
from the broader U.S. economy, which
are documented in chapter 13 of the
NOPR TSD.
DOE estimates that in the absence of
amended energy conservation
standards, there would be 268 domestic
production workers involved in
manufacturing automatic commercial
ice makers in 2018. Using 2011 Census
Bureau data and interviews with
manufacturers, DOE estimates that
approximately 84 percent of automatic
commercial ice makers sold in the
United States are manufactured
domestically. Table V.34 shows the
range of the impacts of potential
amended energy conservation standards
on U.S. production workers in the
automatic commercial ice maker
industry.
TABLE V.34—POTENTIAL CHANGES IN THE TOTAL NUMBER OF DOMESTIC AUTOMATIC COMMERCIAL ICE MAKER
PRODUCTION WORKERS IN 2018
Base case
Total Number of Domestic Production Workers in 2018
(without changes in production locations) ....................
Potential Changes in Domestic Production Workers in
2018 * ............................................................................
1
2
3
4
5
268
268
268
269
269
269
....................
0–(268)
0–(268)
1–(268)
1–(268)
1–(268)
* DOE presents a range of potential employment impacts. Values in parentheses are negative numbers.
All examined TSLs show relatively
minor impacts on domestic employment
levels relative to total industry
employment. At all TSLs, most of the
design options analyzed by DOE do not
greatly alter the labor content of the
final product. For example, the use of
higher efficiency compressors or fan
motors involve one-time changes to the
final product, but do not significantly
change the number of steps required for
the final assembly. One manufacturer
suggested that their domestic
production employment levels would
only change if market demand
contracted following higher overall
prices. However, more than one
manufacturer suggested that where they
already have overseas manufacturing
capabilities, they would consider
moving additional manufacturing to
those facilities if they felt the need to
offset a significant rise in materials
costs. Provided the changes in materials
costs do not support the relocation of
manufacturing facilities, one would
expect only modest changes to domestic
manufacturing employment balancing
additional requirements for assembly
labor with the effects of price elasticity.
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
c. Impacts on Manufacturing Capacity
According to the majority of
automatic commercial ice maker
manufacturers interviewed, amended
energy conservation standards that
require modest changes to product
efficiency will not significantly affect
manufacturers’ production capacities.
Any redesign of automatic commercial
ice makers would not change the
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fundamental assembly of the
equipment, but manufacturers do
anticipate some potential for additional
lead time immediately following
standards associated with changes in
sourcing of higher efficiency
components, which may be supply
constrained.
One manufacturer cited the
possibility of a 3- to 6-month shutdown
in the event that amended standards
were set high enough to require
retooling of their entire product line.
Most of the design options being
evaluated are already available on the
market as product options. Thus, DOE
believes that short of widespread
retooling, manufacturers would be able
to maintain manufacturing capacity
levels and continue to meet market
demand under amended energy
conservation standards.
d. Impacts on Subgroups of
Manufacturers
Small business, low volume, and
niche equipment manufacturers, and
manufacturers exhibiting a cost
structure substantially different from the
industry average could be affected
disproportionately. As discussed in
section IV.J, using average cost
assumptions to develop an industry
cash flow estimate is inadequate to
assess differential impacts among
manufacturer subgroups.
For automatic commercial ice makers,
DOE identified and evaluated the
impact of amended energy conservation
standards on one subgroup: small
manufacturers. The SBA defines a
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‘‘small business’’ as having 750
employees or less for NAICS 333415,
‘‘Air-Conditioning and Warm Air
Heating Equipment and Commercial
and Industrial Refrigeration Equipment
Manufacturing,’’ which includes icemaking machinery manufacturing.
Based on this definition, DOE identified
seven manufacturers in the automatic
commercial ice makers industry that are
small businesses.
For a discussion of the impacts on the
small manufacturer subgroup, see the
regulatory flexibility analysis in section
VI.B of this notice and chapter 12 of the
NOPR TSD.
e. Cumulative Regulatory Burden
While any one regulation may not
impose a significant burden on
manufacturers, the combined effects of
recent or impending regulations may
have serious consequences for some
manufacturers, groups of manufacturers,
or an entire industry. Assessing the
impact of a single regulation may
overlook this cumulative regulatory
burden. In addition to energy
conservation standards, other
regulations can significantly affect
manufacturers’ financial operations.
Multiple regulations affecting the same
manufacturer can strain profits and lead
companies to abandon product lines or
markets with lower expected future
returns than competing products. For
these reasons, DOE conducts an analysis
of cumulative regulatory burden as part
of its rulemakings pertaining to
equipment efficiency.
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During previous stages of this
rulemaking, DOE identified a number of
requirements in addition to amended
energy conservation standards for
automatic commercial ice makers. The
following section briefly addresses
comments DOE received with respect to
cumulative regulatory burden and
summarizes other key related concerns
that manufacturers raised during
interviews.
Existing Federal Standards for
Automatic Commercial Ice Makers
Several manufacturers commented
that they had made substantial
investments in order to comply with the
previous Federal energy conservation
standards for batch style automatic
commercial ice makers, which took
effect in January 2010. While DOE
acknowledges the significant investment
on the part of industry, because the
proposed compliance date for new and
amended standards is 2018, there
should be no direct overlap of
compliance costs from either standard.
The residual financial impact of the
previous energy conservation standards
manifest themselves in the 2018
standards MIA as the prevailing
industry conditions absent new or
amended energy conservation
standards. This serves as the basis for
the base-case INPV.
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
Certification, Compliance, and
Enforcement (CC&E) Rule
Multiple manufacturers expressed
concerns about the burden CC&E would
impose on the automatic commercial ice
maker industry. CC&E requires testing
and compliance for a wide array of
equipment offerings. One manufacturer
cited the increase in testing burden
associated with the DOE’s new
definition of ‘‘basic’’ model, which has
contributed significantly to the number
of models considered to be basic.
Manufacturers worry that testing each
variation would present a significant
testing burden, especially for small
business manufacturers.
In addition to costs associated with
DOE CC&E requirements, manufacturers
cited an array of other certifications as
being an additional and substantial
burden. Such certifications include
codes and standards developed by
American Society of Mechanical
Engineers (ASME), which include
standards for compressors, fasteners,
flow measurement, nuclear,
environmental control, piping, pressure
vessels, pumps, storage tanks, and
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more.67 Other critical certification
programs for manufacturers of
automatic commercial ice makers
include those of National Sanitation
Foundation (NSF), Underwriters
Laboratories (UL), NRCan, and CEC. A
new energy efficiency standard put forth
by the DOE that requires a complete
product redesign will necessitate
recertification from the abovementioned programs. Manufacturers are
concerned about the cumulative testing
burden associated with such recertifications.
DOE understands that testing and
certification requirements may have a
significant impact on manufacturers,
and the CC&E burden is identified as a
key issue in the MIA. DOE also
understands that CC&E requirements
can be particularly onerous for
manufacturers producing low volume or
highly customized equipment.
Regarding other certification programs,
the DOE again acknowledges the
potential burden associated with
recertification. However, DOE also
recognizes that these programs are
voluntary.
EPA and ENERGY STAR
Some manufacturers expressed
concerns regarding potential conflicts
with the ENERGY STAR certification
program. Manitowoc publicly
commented that certification by the
ENERGY STAR program is very
important to their customers for a
variety of reasons including the
potential for utility rebates and LEED
certification. Manitowoc went on to say
that if DOE’s energy efficiency standard
level is raised to the max-tech level,
there would be no room for the ENERGY
STAR classification and that this could
be highly disruptive to the industry
(Manitowoc, No. 42 at pp. 15–16). Due
to the clear market value of the ENERGY
STAR program, manufacturers
expressed concern about the additional
testing burdens associated with having
to re-certify products, or alternatively,
having to forfeit market share by
offering products that are not ENERGY
STAR certified.
DOE realizes that the cumulative
effect of several regulations on an
industry may significantly increase the
burden faced by manufacturers that
need to comply with multiple
regulations and certification programs
from different organizations and levels
of government. However, DOE notes
that certain standards, such as ENERGY
STAR, are optional for manufacturers.
67 Information about ASME codes and standards
can be obtained at: www.asme.org/kb/standards/
standards.
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Other Federal Regulations
Manufacturers also expressed
concerns regarding the additional
burden caused by other Federal
regulations, including the upcoming
amended energy conservation standards
for residential refrigerators and freezers,
commercial refrigeration equipment,
walk-in coolers and freezers,
miscellaneous residential refrigeration
products, and cooking products.
DOE recognizes the additional burden
faced by manufacturers that produce
both automatic commercial ice makers
in combination with one or many of the
above-mentioned products. Companies
that produce a wide range of regulated
equipment may be faced with more
capital and equipment design
development expenditures than
competitors with a narrower scope of
production. DOE does attempt to
quantify the cumulative burden of
Federal energy conservation standards
on manufacturers in its manufacturer
impact analysis (see chapter 12 of TSD).
However, DOE cannot consider the
quantitative impacts of amended
standards that have not yet been
finalized, such as those for walk-in
coolers and walk-in freezers.
State Regulations
Relating to the CEC codes and
standards, one manufacturer noted
California’s 2020 energy policy goals,
including the reduction of greenhouse
gas emissions to 1990 levels, as a source
of additional burden for automatic
commercial ice maker manufacturers.
Manufacturers also added that the lead
limit guidelines (see, for example,
section 4–101.13(C) of the Food Code
2013) 68 put forth by the U.S. Food and
Drug Administration (FDA), and
adopted as code by all 50 states,69 carry
associated compliance costs. The levels
specified by these guidelines have
remained unchanged for at least 15
years.
International Regulations
Finally, one manufacturer noted
additional burden associated with the
European Union (EU) Restriction on
Hazardous Substances Directive (RoHS),
which restricts the use of six hazardous
materials, including lead, mercury, and
cadmium, in the manufacture of various
types of electronic and electrical
equipment.70
68 https://www.fda.gov/Food/GuidanceRegulation/
RetailFoodProtection/FoodCode/ucm374275.htm).
69 https://www.fda.gov/downloads/Food/
GuidanceRegulation/RetailFoodProtection/
FederalStateCooperativePrograms/UCM230336.pdf.
70 Information on EU RoHS can be found at:
www.bis.gov.uk/nmo/enforcement/rohs-home.
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DOE discusses these and other
requirements, and includes the full
details of the cumulative regulatory
burden analysis, in chapter 12 of the
NOPR TSD.
3. National Impact Analysis
a. Amount and Significance of Energy
Savings
DOE estimated the NES by calculating
the difference in annual energy
consumption for the base-case scenario
and standards-case scenario at each TSL
also reports primary or source energy
that takes into account losses in the
generation and transmission of
electricity. FFC and primary energy are
discussed in section IV.H.
Table V.35 presents the source NES
for all equipment classes at each TSL
and the sum total of NES for each TSL.
Table V.36 presents the energy savings
at each TSL for each equipment class in
the form of percentage of the cumulative
energy use of the equipment stock in the
base-case scenario.
for each equipment class and summing
up the annual energy savings for the
automatic commercial ice maker
equipment purchased during the 30year 2018 to 2047 analysis period.
Energy impacts include the 30-year
period, plus the life of equipment
purchased in the last year of the
analysis, or roughly 2018 to 2057. The
energy consumption calculated in the
NIA is full-fuel-cycle (FFC) energy,
which quantifies savings beginning at
the source of energy production. DOE
TABLE V.35—CUMULATIVE NATIONAL ENERGY SAVINGS AT SOURCE FOR EQUIPMENT PURCHASED IN 2018–2047
Standard level *, **
Equipment class
TSL 1
TSL 2
TSL 3
TSL 4
TSL 5
IMH–W–Small–B ......................................................................................
IMH–W–Med–B ........................................................................................
IMH–W–Large–B *** .................................................................................
IMH–W–Large–B1 ............................................................................
IMH–W–Large–B2 ............................................................................
IMH–A–Small–B .......................................................................................
IMH–A–Large–B *** ..................................................................................
IMH–A–Large–B1 .............................................................................
IMH–A–Large–B2 .............................................................................
RCU–Large–B *** .....................................................................................
RCU–Large–B1 .................................................................................
RCU–Large–B2 .................................................................................
SCU–W–Large–B .....................................................................................
SCU–A–Small–B ......................................................................................
SCU–A–Large–B .....................................................................................
IMH–A–Small–C ......................................................................................
IMH–A–Large–C ......................................................................................
SCU–A–Small–C ......................................................................................
0.002
0.006
0.001
0.001
0.000
0.017
0.024
0.020
0.005
0.013
0.012
0.001
0.000
0.002
0.002
0.002
0.001
0.001
0.004
0.006
0.001
0.001
0.000
0.032
0.045
0.040
0.005
0.013
0.012
0.001
0.000
0.013
0.010
0.003
0.003
0.004
0.010
0.009
0.001
0.001
0.000
0.076
0.095
0.086
0.009
0.030
0.028
0.002
0.000
0.024
0.017
0.005
0.006
0.007
0.010
0.013
0.002
0.002
0.001
0.099
0.122
0.107
0.015
0.046
0.043
0.003
0.000
0.037
0.022
0.008
0.008
0.007
0.013
0.014
0.003
0.002
0.001
0.105
0.122
0.107
0.015
0.047
0.045
0.003
0.000
0.037
0.022
0.012
0.008
0.011
Total ..................................................................................................
0.072
0.134
0.281
0.374
0.395
* A value equal to 0.000 means the NES rounds to less than 0.001 quads.
** Numbers may not add to totals due to rounding.
*** IMH–W–Large–B, IMH–A–Large–B, and RCU–Large–B results are the sum of the results for the 2 typical units denoted by B1 and B2.
TABLE V.36—CUMULATIVE ENERGY SAVINGS BY TSL AS A PERCENTAGE OF CUMULATIVE BASELINE ENERGY USAGE OF
AUTOMATIC COMMERCIAL ICE MAKER EQUIPMENT PURCHASED IN 2018–2047
Base case
energy
usage
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
Equipment class
TSL savings as percent of baseline usage
TSL 1 (%)
TSL 2 (%)
TSL 3 (%)
TSL 4 (%)
TSL 5 (%)
IMH–W–Small–B ..............................................................
IMH–W–Med–B ................................................................
IMH–W–Large–B * ............................................................
IMH–W–Large–B1 ....................................................
IMH–W–Large–B2 ....................................................
IMH–A–Small–B ...............................................................
IMH–A–Large–B * .............................................................
IMH–A–Large–B1 .....................................................
IMH–A–Large–B2 .....................................................
RCU–Large–B * ................................................................
RCU–Large–B1 .........................................................
RCU–Large–B2 .........................................................
SCU–W–Large–B .............................................................
SCU–A–Small–B ..............................................................
SCU–A–Large–B ..............................................................
IMH–A–Small–C ...............................................................
IMH–A–Large–C ..............................................................
SCU–A–Small–C ..............................................................
0.062
0.089
0.026
0.017
0.009
0.463
0.635
0.490
0.145
0.357
0.333
0.024
0.003
0.138
0.092
0.068
0.041
0.073
4
6
6
7
3
4
4
4
3
4
4
2
2
1
2
2
4
2
7
6
6
7
3
7
7
8
3
4
4
2
5
9
10
5
6
6
16
10
6
7
3
16
15
17
6
8
8
7
9
18
19
8
14
9
16
15
9
10
7
21
19
22
11
13
13
11
14
27
24
12
19
9
21
16
10
11
8
23
19
22
11
13
13
11
14
27
24
17
19
16
Total ..........................................................................
2.047
4
7
14
18
19
* IMH–W–Large–B, IMH–A–Large–B, and RCU–Large–B results are the sum of the results for the 2 typical units denoted by B1 and B2.
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Table V.37 presents energy savings at
each TSL for each equipment class with
the FFC adjustment. The NES increases
from 0.073 quads at TSL 1 to 0.401
quads at TSL 5.
TABLE V.37—CUMULATIVE NATIONAL ENERGY SAVINGS INCLUDING FULL-FUEL-CYCLE FOR EQUIPMENT PURCHASED IN
2018–2047
Standard level ***
Equipment class
TSL 1
TSL 2
TSL 3
TSL 4
TS L5
IMH–W–Small–B ......................................................................................
IMH–W–Med–B ........................................................................................
IMH–W–Large–B *** .................................................................................
IMH–W–Large–B1 ............................................................................
IMH–W–Large–B2 ............................................................................
IMH–A–Small–B .......................................................................................
IMH–A–Large–B *** ..................................................................................
IMH–A–Large–B1 .............................................................................
IMH–A–Large–B2 .............................................................................
RCU–Large–B *** .....................................................................................
RCU–Large–B1 .................................................................................
RCU–Large–B2 .................................................................................
SCU–W–Large–B .....................................................................................
SCU–A–Small–B ......................................................................................
SCU–A–Large–B .....................................................................................
IMH–A–Small–C ......................................................................................
IMH–A–Large–C ......................................................................................
SCU–A–Small–C ......................................................................................
0.002
0.006
0.001
0.001
0.000
0.017
0.025
0.020
0.005
0.013
0.013
0.001
0.000
0.002
0.002
0.002
0.001
0.001
0.004
0.006
0.001
0.001
0.000
0.033
0.045
0.041
0.005
0.013
0.013
0.001
0.000
0.013
0.010
0.003
0.003
0.004
0.010
0.009
0.001
0.001
0.000
0.077
0.096
0.087
0.009
0.030
0.029
0.002
0.000
0.025
0.018
0.006
0.006
0.007
0.010
0.014
0.002
0.002
0.001
0.100
0.124
0.108
0.016
0.046
0.044
0.003
0.000
0.038
0.022
0.008
0.008
0.007
0.013
0.015
0.003
0.002
0.001
0.107
0.124
0.108
0.016
0.048
0.045
0.003
0.000
0.038
0.022
0.012
0.008
0.012
Total ..................................................................................................
0.073
0.136
0.286
0.380
0.401
* A value equal to 0.000 means the NES rounds to less than 0.001 quads.
** Numbers may not add to totals due to rounding.
*** IMH–W–Large–B, IMH–A–Large–B, and RCU–Large–B results are the sum of the results for the 2 typical units denoted by B1 and B2.
Circular A–4 requires agencies to
present analytical results, including
separate schedules of the monetized
benefits and costs that show the type
and timing of benefits and costs.
Circular A–4 also directs agencies to
consider the variability of key elements
underlying the estimates of benefits and
costs. For this rulemaking, DOE
undertook a sensitivity analysis using 9
rather than 30 years of product
shipments. The choice of a 9-year
period is a proxy for the timeline in
EPCA for the review of certain energy
conservation standards and potential
revision of and compliance with such
revised standards.71 We would note that
the review timeframe established in
EPCA generally does not overlap with
the product lifetime, product
manufacturing cycles or other factors
specific to automatic commercial ice
makers. Thus, this information is
presented for informational purposes
only and is not indicative of any change
in DOE’s analytical methodology. The
NES results based on a 9-year analysis
period are presented in Table V.38. The
impacts are counted over the lifetime of
equipment purchased in 2018–2026
TABLE V.38—NATIONAL FULL-FUEL-CYCLE ENERGY SAVINGS FOR 9-YEAR ANALYSIS PERIOD FOR EQUIPMENT
PURCHASED IN 2018–2026
Standard level ***
Equipment class
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
TSL 1
IMH–W–Small–B ......................................................................................
IMH–W–Med–B ........................................................................................
IMH–W–Large–B *** .................................................................................
IMH–W–Large–B1 ............................................................................
IMH–W–Large–B2 ............................................................................
IMH–A–Small–B .......................................................................................
IMH–A–Large–B *** ..................................................................................
IMH–A–Large–B1 .............................................................................
IMH–A–Large–B2 .............................................................................
RCU–Large–B *** .....................................................................................
RCU–Large–B1 .................................................................................
71 For automatic commercial ice makers, DOE is
required to review standards at least every five
years after the effective date of any amended
standards. (42 U.S.C. 6313(d)(3)(B)) If new
standards are promulgated, EPCA requires DOE to
provide manufacturers a minimum of 3 and a
maximum of 5 years to comply with the standards.
(42 U.S.C. 6313(d)(3)(C)) In addition, for certain
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0.001
0.002
0.000
0.000
0.000
0.005
0.007
0.005
0.001
0.004
0.003
other types of commercial equipment that are not
specified in 42 U.S.C. 6311(1)(B)–(G), EPCA
requires DOE to review its standards at least once
every 6 years (42 U.S.C. 6295(m)(1) and 6316(a)),
and either a 3-year or a 5-year period after any new
standard is promulgated before compliance is
required. (42 U.S.C. 6295(m)(4) and 6316(a)) As a
result, DOE’s standards for automatic commercial
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TSL 3
0.001
0.002
0.000
0.000
0.000
0.009
0.012
0.011
0.001
0.004
0.003
0.003
0.003
0.000
0.000
0.000
0.021
0.026
0.024
0.003
0.008
0.008
TSL 4
0.003
0.004
0.001
0.000
0.000
0.028
0.034
0.030
0.004
0.013
0.012
TSL 5
0.004
0.004
0.001
0.001
0.000
0.029
0.034
0.030
0.004
0.013
0.012
ice makers can be expected to be in effect for 8 to
10 years between compliance dates, and its
standards governing certain other commercial
equipment, the period is 9 to 11 years. A 9-year
analysis was selected as representative of the time
between standard revisions.
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TABLE V.38—NATIONAL FULL-FUEL-CYCLE ENERGY SAVINGS FOR 9-YEAR ANALYSIS PERIOD FOR EQUIPMENT
PURCHASED IN 2018–2026—Continued
Standard level ***
Equipment class
TSL 1
TSL 2
TSL 3
TSL 4
TSL 5
RCU–Large–B2 .................................................................................
SCU–W–Large–B .....................................................................................
SCU–A–Small–B ......................................................................................
SCU–A–Large–B .....................................................................................
IMH–A–Small–C ......................................................................................
IMH–A–Large–C ......................................................................................
SCU–A–Small–C ......................................................................................
0.000
0.000
0.000
0.001
0.000
0.000
0.000
0.000
0.000
0.004
0.003
0.001
0.001
0.001
0.000
0.000
0.007
0.005
0.002
0.002
0.002
0.001
0.000
0.010
0.006
0.002
0.002
0.002
0.001
0.000
0.010
0.006
0.003
0.002
0.003
Total ..................................................................................................
0.020
0.037
0.079
0.104
0.110
* A value equal to 0.000 means the NES rounds to less than 0.001 quads.
** Numbers may not add to totals due to rounding.
*** IMH–W–Large–B, IMH–A–Large–B, and RCU–Large–B results are the sum of the results for the 2 typical units denoted by B1 and B2.
b. Net Present Value of Customer Costs
and Benefits
DOE estimated the cumulative NPV to
the Nation of the total savings for the
customers that would result from
potential standards at each TSL. In
accordance with OMB guidelines on
regulatory analysis (OMB Circular A–4,
section E, September 17, 2003), DOE
calculated NPV using both a 7-percent
and a 3-percent real discount rate. The
7-percent rate is an estimate of the
average before-tax rate of return on
private capital in the U.S. economy, and
reflects the returns on real estate and
small business capital, including
corporate capital. DOE used this
discount rate to approximate the
opportunity cost of capital in the private
sector, because recent OMB analysis has
found the average rate of return on
capital to be near this rate. In addition,
DOE used the 3-percent rate to capture
the potential effects of amended
standards on private consumption. This
rate represents the rate at which society
discounts future consumption flows to
their present value. It can be
approximated by the real rate of return
on long-term government debt (i.e.,
yield on Treasury notes minus annual
rate of change in the CPI), which has
averaged about 3 percent on a pre-tax
basis for the last 30 years.
Table V.39 and Table V.40 show the
customer NPV results for each of the
TSLs DOE considered for automatic
commercial ice makers at both 7-percent
and 3-percent discount rates. In each
case, the impacts cover the expected
lifetime of equipment purchased from
2018–2047. Detailed NPV results are
presented in chapter 10 of the NOPR
TSD.
The NPV results at a 7-percent
discount rate for TSL 5 were negative
for three equipment classes and
significantly lower than the TSL 3
results for several other classes. This is
consistent with the results of LCC
analysis results for TSL 5, which
showed significant increase in LCC and
significantly higher PBPs that were in
some cases greater than the average
equipment lifetimes. Efficiency levels
for TSL 4 were chosen to correspond to
the highest efficiency level with a
positive NPV for all classes at a 7percent discount rate. Similarly, the
criteria for choice of efficiency levels for
TSL 3, TSL 2, and TSL 1 were such that
the NPV values for all the equipment
classes show positive values. The
criterion for TSL 3 was to select
efficiency levels with the highest NPV at
a 7-percent discount rate. Consequently,
the total NPV for automatic commercial
ice makers was highest for TSL 3, with
a value of $0.791 billion (2012$) at a 7percent discount rate. TSL 4 showed the
second highest total NPV, with a value
of $0.484 billion (2012$) at a 7-percent
discount rate. TSL 1, TSL 2 and TSL 5
have a total NPV lower than TSL 3 or
4.
TABLE V.39—NET PRESENT VALUE AT A 7-PERCENT DISCOUNT RATE FOR EQUIPMENT PURCHASED IN 2018–2047
[2012$]
Standard level *
Equipment class
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
TSL 1
IMH–W–Small–B ......................................................................................
IMH–W–Med–B ........................................................................................
IMH–W–Large–B ** ..................................................................................
IMH–W–Large–B1 ............................................................................
IMH–W–Large–B2 ............................................................................
IMH–A–Small–B .......................................................................................
IMH–A–Large–B ** ...................................................................................
IMH–A–Large–B1 .............................................................................
IMH–A–Large–B2 .............................................................................
RCU–Large–B ** ......................................................................................
RCU–Large–B1 .................................................................................
RCU–Large–B2 .................................................................................
SCU–W–Large–B .....................................................................................
SCU–A–Small–B ......................................................................................
SCU–A–Large–B .....................................................................................
IMH–A–Small–C ......................................................................................
IMH–A–Large–C ......................................................................................
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0.006
0.016
0.004
0.003
0.001
0.043
0.070
0.057
0.014
0.038
0.036
0.002
0.001
0.004
0.004
0.004
0.004
Sfmt 4702
0.011
0.016
0.004
0.003
0.001
0.080
0.127
0.113
0.014
0.038
0.036
0.002
0.001
0.029
0.039
0.009
0.007
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TSL 3
0.025
0.025
0.004
0.003
0.001
0.177
0.297
0.274
0.023
0.082
0.078
0.004
0.001
0.085
0.052
0.014
0.016
17MRP2
TSL 4
0.025
0.017
0.003
0.002
0.001
0.046
0.256
0.236
0.020
0.073
0.070
0.004
0.000
0.012
0.021
0.011
0.007
TSL 5
(0.002)
0.019
0.003
0.002
0.001
0.058
0.256
0.236
0.020
0.075
0.072
0.004
0.000
0.012
0.021
(0.018)
0.007
14930
Federal Register / Vol. 79, No. 51 / Monday, March 17, 2014 / Proposed Rules
TABLE V.39—NET PRESENT VALUE AT A 7-PERCENT DISCOUNT RATE FOR EQUIPMENT PURCHASED IN 2018–2047—
Continued
[2012$]
Standard level *
Equipment class
TSL 1
TSL 2
TSL 3
TSL 4
TSL 5
SCU–A–Small–C ......................................................................................
0.004
0.009
0.013
0.013
(0.062)
Total ..................................................................................................
0.198
0.368
0.791
0.484
0.370
* A value equal to 0.000 means the NPV rounds to less than $0.001 (2012$). Values in parentheses are negative numbers.
** IMH–W–Large–B, IMH–A–Large–B, and RCU–Large–B results are the sum of the results for the 2 typical units denoted by B1 and B2.
TABLE V.40—NET PRESENT VALUE AT A 3-PERCENT DISCOUNT RATE FOR EQUIPMENT PURCHASED IN 2018–2047
[2012$]
Standard level *
Equipment class
TSL 1
TSL 2
TSL 3
TSL 4
TSL 5
IMH–W–Small–B ......................................................................................
IMH–W–Med–B ........................................................................................
IMH–W–Large–B** ...................................................................................
IMH–W–Large–B1 ............................................................................
IMH–W–Large–B2 ............................................................................
IMH–A–Small–B .......................................................................................
IMH–A–Large–B** ....................................................................................
IMH–A–Large–B1 .............................................................................
IMH–A–Large–B2 .............................................................................
RCU–Large–B ** ......................................................................................
RCU–Large–B1 .................................................................................
RCU–Large–B2 .................................................................................
SCU–W–Large–B .....................................................................................
SCU–A–Small–B ......................................................................................
SCU–A–Large–B .....................................................................................
IMH–A–Small–C ......................................................................................
IMH–A–Large–C ......................................................................................
SCU–A–Small–C ......................................................................................
0.013
0.034
0.009
0.007
0.002
0.094
0.152
0.123
0.030
0.081
0.078
0.004
0.001
0.009
0.010
0.009
0.009
0.008
0.023
0.034
0.009
0.007
0.002
0.176
0.275
0.245
0.030
0.081
0.078
0.004
0.002
0.064
0.086
0.019
0.016
0.021
0.057
0.054
0.009
0.007
0.002
0.394
0.653
0.602
0.051
0.178
0.169
0.009
0.002
0.190
0.118
0.031
0.034
0.030
0.057
0.042
0.007
0.006
0.001
0.163
0.596
0.546
0.050
0.174
0.165
0.009
0.001
0.062
0.062
0.027
0.018
0.030
0.010
0.047
0.008
0.006
0.002
0.190
0.596
0.546
0.050
0.179
0.170
0.009
0.001
0.062
0.062
(0.028)
0.018
(0.114)
Total ..................................................................................................
0.430
0.806
1.751
1.238
1.032
* A value equal to 0.000 means the NPV rounds to less than $0.001 (2012$). Values in parentheses are negative numbers.
** IMH–W–Large–B, IMH–A–Large–B, and RCU–Large–B results are the sum of the results for the 2 typical units denoted by B1 and B2.
The NPV results based on the
aforementioned 9-year analysis period
are presented in Table V.41 and Table
V.42. The impacts are counted over the
lifetime of equipment purchased in
2018–2026. As mentioned previously,
this information is presented for
informational purposes only and is not
indicative of any change in DOE’s
analytical methodology or decision
criteria.
TABLE V.41—NET PRESENT VALUE AT A 7-PERCENT DISCOUNT RATE FOR 9-YEAR ANALYSIS PERIOD FOR EQUIPMENT
PURCHASED IN 2018–2026
Standard level *
Equipment class
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
TSL 1
IMH–W–Small–B ......................................................................................
IMH–W–Med–B ........................................................................................
IMH–W–Large–B ......................................................................................
IMH–W–Large–B–1 ..........................................................................
IMH–W–Large–B–2 ..........................................................................
IMH–A–Small–B .......................................................................................
IMH–A–Large–B ......................................................................................
IMH–A–Large–B–1 ...........................................................................
IMH–A–Large–B–2 ...........................................................................
RCU–Large–B ..........................................................................................
RCU–Large–B–1 ...............................................................................
RCU–Large–B–2 ...............................................................................
SCU–W–Large–B .....................................................................................
SCU–A–Small–B ......................................................................................
SCU–A–Large–B .....................................................................................
IMH–A–Small–C ......................................................................................
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0.003
0.008
0.002
0.002
0.000
0.021
0.034
0.028
0.007
0.018
0.017
0.001
0.000
0.002
0.002
0.002
Sfmt 4702
0.005
0.008
0.002
0.002
0.000
0.039
0.062
0.055
0.007
0.018
0.017
0.001
0.000
0.014
0.018
0.004
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TSL 3
0.012
0.012
0.002
0.002
0.000
0.086
0.143
0.132
0.011
0.040
0.038
0.002
0.001
0.040
0.025
0.007
17MRP2
TSL 4
0.012
0.008
0.001
0.001
0.000
0.023
0.123
0.113
0.010
0.036
0.034
0.002
0.000
0.005
0.010
0.005
TSL 5
(0.001)
0.009
0.002
0.001
0.000
0.029
0.123
0.113
0.010
0.037
0.035
0.002
0.000
0.005
0.010
(0.009)
14931
Federal Register / Vol. 79, No. 51 / Monday, March 17, 2014 / Proposed Rules
TABLE V.41—NET PRESENT VALUE AT A 7-PERCENT DISCOUNT RATE FOR 9-YEAR ANALYSIS PERIOD FOR EQUIPMENT
PURCHASED IN 2018–2026—Continued
Standard level *
Equipment class
TSL 1
TSL 2
TSL 3
TSL 4
TSL 5
IMH–A–Large–C ......................................................................................
SCU–A–Small–C ......................................................................................
0.002
0.002
0.004
0.005
0.008
0.006
0.003
0.006
0.003
(0.031)
Total ..................................................................................................
0.096
0.179
0.381
0.233
0.177
* A value equal to 0.000 means the NPV rounds to less than $0.001 (2012$). Values in parentheses are negative numbers.
TABLE V.42—NET PRESENT VALUE AT A 3-PERCENT DISCOUNT RATE FOR 9-YEAR ANALYSIS PERIOD FOR EQUIPMENT
PURCHASED IN 2018–2026
Standard level*
Equipment class
TSL 1
TSL 2
TSL 3
TSL 4
TSL 5
IMH–W–Small–B ......................................................................................
IMH–W–Med–B ........................................................................................
IMH–W–Large–B ......................................................................................
IMH–W–Large–B–1 .................................................................................
IMH–W–Large–B–2 .................................................................................
IMH–A–Small–B .......................................................................................
IMH–A–Large–B ......................................................................................
IMH–A–Large–B–1 ..................................................................................
IMH–A–Large–B–2 ..................................................................................
RCU–Large–B ..........................................................................................
RCU–Large–B–1 ......................................................................................
RCU–Large–B–2 ......................................................................................
SCU–W–Large–B .....................................................................................
SCU–A–Small–B ......................................................................................
SCU–A–Large–B .....................................................................................
IMH–A–Small–C ......................................................................................
IMH–A–Large–C ......................................................................................
SCU–A–Small–C ......................................................................................
0.005
0.012
0.003
0.002
0.001
0.034
0.054
0.044
0.011
0.029
0.028
0.001
0.000
0.003
0.003
0.003
0.003
0.003
0.008
0.012
0.003
0.002
0.001
0.063
0.098
0.088
0.011
0.029
0.028
0.001
0.001
0.023
0.030
0.007
0.006
0.007
0.020
0.019
0.003
0.002
0.001
0.141
0.230
0.211
0.018
0.064
0.060
0.003
0.001
0.065
0.041
0.011
0.012
0.010
0.020
0.015
0.003
0.002
0.001
0.058
0.209
0.191
0.018
0.062
0.059
0.003
0.000
0.020
0.021
0.010
0.006
0.010
0.003
0.017
0.003
0.002
0.001
0.068
0.209
0.191
0.018
0.064
0.061
0.003
0.000
0.020
0.021
(0.010)
0.006
(0.042)
Total ..................................................................................................
0.153
0.287
0.617
0.434
0.359
*A value equal to 0.000 means the NPV rounds to less than $0.001 (2012$). Values in parentheses are negative numbers.
c. Water Savings
option had the additional impact of
reducing potable water usage for some
types of batch type ice makers. The
In analyzing energy-saving design
options for batch type ice makers, one
potable water savings are identified on
Table V.43.
TABLE V.43—POTABLE WATER SAVINGS
National water savings by standard level*,**
million gallons
Equipment class
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
TSL 1
IMH–W–Small–B ......................................................................................
IMH–W–Med–B ........................................................................................
IMH–W–Large–B ......................................................................................
IMH–W–Large–B–1 .................................................................................
IMH–W–Large–B–2 .................................................................................
IMH–A–Small–B .......................................................................................
IMH–A–Large–B ......................................................................................
IMH–A–Large–B–1 ..................................................................................
IMH–A–Large–B–2 ..................................................................................
RCU–063–Large–B ..................................................................................
RCU–064–Large–B–1 ..............................................................................
RCU–065–Large–B–2 ..............................................................................
SCU–W–Large–B .....................................................................................
SCU–A–Small–B ......................................................................................
SCU–A–Large–B .....................................................................................
IMH–A–Small–C ......................................................................................
IMH–A–Large–C ......................................................................................
SCU–A–Small–C ......................................................................................
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0
0
0
0
0
0
0
0
0
0
0
0
141
0
0
0
0
0
Sfmt 4702
0
0
0
0
0
0
0
0
0
0
0
0
141
0
6,424
0
0
0
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TSL 3
3,699
0
0
0
0
0
20,753
20,753
0
0
0
0
141
14,391
6,424
0
0
0
17MRP2
TSL 4
3,699
0
0
0
0
0
20,753
20,753
0
0
0
0
141
14,391
6,424
0
0
0
TSL 5
3,699
0
0
0
0
0
20,753
20,753
0
0
0
0
141
14,391
6,424
0
0
0
14932
Federal Register / Vol. 79, No. 51 / Monday, March 17, 2014 / Proposed Rules
TABLE V.43—POTABLE WATER SAVINGS—Continued
National water savings by standard level*,**
million gallons
Equipment class
TSL 1
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
Total ..................................................................................................
d. Employment Impacts
In addition to the direct impacts on
manufacturing employment discussed
in section V.B.2, DOE develops general
estimates of the indirect employment
impacts of proposed standards on the
economy. As discussed above, DOE
expects amended energy conservation
standards for automatic commercial ice
makers to reduce energy bills for
commercial customers, and the resulting
net savings to be redirected to other
forms of economic activity. DOE also
realizes that these shifts in spending
and economic activity by automatic
commercial ice maker owners could
affect the demand for labor. Thus,
indirect employment impacts may result
from expenditures shifting between
goods (the substitution effect) and
changes in income and overall
expenditure levels (the income effect)
that occur due to the imposition of
amended standards. These impacts may
affect a variety of businesses not directly
involved in the decision to make,
operate, or pay the utility bills for
automatic commercial ice makers. To
estimate these indirect economic effects,
DOE used an input/output model of the
U.S. economy using U.S. Department of
Commerce, Bureau of Economic
Analysis (BEA) and BLS data (as
described in section IV.N of this notice;
see chapter 16 of the NOPR TSD for
more details).
In this input/output model, the
dollars saved on utility bills from moreefficient automatic commercial ice
makers are concentrated in economic
sectors that create more jobs than are
lost in electric and water utilities sectors
when spending is shifted from
electricity and/or water to other
products and services. Thus, the
proposed amended energy conservation
standards for automatic commercial ice
makers are likely to slightly increase the
net demand for labor in the economy.
However, the net increase in jobs might
be offset by other, unanticipated effects
on employment. Neither the BLS data
nor the input/output model used by
DOE includes the quality of jobs. As
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141
6,565
shown in Table V.44, DOE estimates
that net indirect employment impacts
from a proposed automatic commercial
ice makers amended standard are small
relative to the national economy.
TABLE V.44—NET SHORT-TERM
CHANGE IN EMPLOYMENT
Trial standard
level
1
2
3
4
5
.......................
.......................
.......................
.......................
.......................
2018
19
36
75
44
34
to
to
to
to
to
20
40
87
91
90
2022
...
...
...
...
...
100
192
431
506
518
to
to
to
to
to
101.
196.
442.
552.
572.
4. Impact on Utility or Performance of
Equipment
In performing the engineering
analysis, DOE considers design options
that would not lessen the utility or
performance of the individual classes of
equipment. (42 U.S.C.
6295(o)(2)(B)(i)(IV) and 6316(e)(1)) As
presented in the screening analysis
(chapter 4 of the NOPR TSD), DOE
eliminates from consideration any
design options that reduce the utility of
the equipment. For this notice, DOE
proposes that none of the TSLs
considered for automatic commercial
ice makers reduce the utility or
performance of the equipment.
5. Impact of Any Lessening of
Competition
EPCA directs DOE to consider any
lessening of competition likely to result
from amended standards. It directs the
Attorney General of the United States
(Attorney General) to determine in
writing the impact, if any, of any
lessening of competition likely to result
from a proposed standard. (42 U.S.C.
6295(o)(2)(B)(i)(V) and 6313(d)(4)) To
assist the Attorney General in making
such a determination, DOE provided the
DOJ with copies of this notice and the
TSD for review. During MIA interviews,
domestic manufacturers indicated that
foreign manufacturers have begun to
enter the automatic commercial ice
maker industry, but not in significant
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TSL 3
45,407
TSL 4
TSL 5
45,407
45,407
numbers. Manufacturers also stated that
consolidation has occurred among
automatic commercial ice makers
manufacturers in recent years.
Interviewed manufacturers believe that
these trends may continue in this
market even in the absence of amended
standards.
DOE does not believe that amended
standards would result in domestic
firms moving their production facilities
outside the United States. The majority
of automatic commercial ice makers are
manufactured in the United States and,
during interviews, manufacturers in
general indicated they would modify
their existing facilities to comply with
amended energy conservation
standards.
6. Need of the Nation To Conserve
Energy
An improvement in the energy
efficiency of the equipment subject to
today’s NOPR is likely to improve the
security of the Nation’s energy system
by reducing overall demand for energy.
Reduced electricity demand may also
improve the reliability of the electricity
system. As a measure of this reduced
demand, chapter 15 in the NOPR TSD
presents the estimated reduction in
national generating capacity for the
TSLs that DOE considered in this
rulemaking.
Energy savings from amended
standards for automatic commercial ice
makers could also produce
environmental benefits in the form of
reduced emissions of air pollutants and
GHGs associated with electricity
production. Table V.45 provides DOE’s
estimate of cumulative CO2, NOX, Hg,
N2O, CH4 and SO2 emissions reductions
projected to result from the TSLs
considered in this rule. The table
includes both power sector emissions
and upstream emissions. The upstream
emissions were calculated using the
multipliers discussed in section IV.K.
DOE reports annual emissions
reductions for each TSL in chapter 13 of
the NOPR TSD.
E:\FR\FM\17MRP2.SGM
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14933
Federal Register / Vol. 79, No. 51 / Monday, March 17, 2014 / Proposed Rules
TABLE V.45—SUMMARY OF EMISSIONS REDUCTION ESTIMATED FOR AUTOMATIC COMMERCIAL ICE MAKERS TSLS
[Cumulative for equipment purchased in 2018–2047]
TSL
1
2
3
4
5
Power Sector and Site Emissions
CO2 (million metric tons) .................................
NOX (thousand tons) .......................................
Hg (tons) ..........................................................
N2O (thousand tons) ........................................
CH4 (thousand tons) ........................................
SO2 (thousand tons) ........................................
3.50
¥0.89
0.01
0.08
0.47
5.31
6.52
¥1.66
0.01
0.15
0.88
9.89
13.68
¥3.49
0.02
0.31
1.84
20.76
18.19
¥4.64
0.03
0.41
2.45
27.60
19.19
¥4.89
0.03
0.43
2.58
29.12
Upstream Emissions
CO2 (million metric tons) .................................
NOX (thousand tons) .......................................
Hg (tons) ..........................................................
N2O (thousand tons) ........................................
CH4 (thousand tons) ........................................
SO2 (thousand tons) ........................................
0.23
3.11
0.000
0.00
18.89
0.05
0.42
5.80
0.000
0.00
35.22
0.09
0.89
12.18
0.000
0.01
73.93
0.19
1.18
16.19
0.001
0.01
98.30
0.25
1.24
17.08
0.001
0.01
103.68
0.27
Total Emissions
CO2 (million metric tons) .................................
NOX (thousand tons) .......................................
Hg (tons) ..........................................................
N2O (thousand tons) ........................................
CH4 (thousand tons) ........................................
SO2 (thousand tons) ........................................
As part of the analysis for this NOPR,
DOE estimated monetary benefits likely
to result from the reduced emissions of
CO2 and NOX that DOE estimated for
each of the TSLs considered. As
discussed in section IV.L, DOE used
values for the SCC developed by an
interagency process. The interagency
group selected four sets of SCC values
for use in regulatory analyses. Three sets
are based on the average SCC from three
integrated assessment models, at
3.72
2.22
0.01
0.08
19.36
5.35
6.94
4.14
0.01
0.15
36.09
9.98
14.57
8.69
0.02
0.32
75.77
20.95
discount rates of 2.5 percent, 3 percent,
and 5 percent. The fourth set, which
represents the 95th-percentile SCC
estimate across all three models at a 3percent discount rate, is included to
represent higher-than-expected impacts
from temperature change further out in
the tails of the SCC distribution. The
four SCC values for CO2 emissions
reductions in 2015, expressed in 2012$,
are $11.8/ton, $39.7/ton, $61.2/ton, and
$117.0/ton. These values for later years
19.37
11.56
0.03
0.42
100.75
27.86
20.43
12.19
0.03
0.45
106.27
29.38
are higher due to increasing emissionsrelated costs as the magnitude of
projected climate change is expected to
increase.
Table V.46 presents the global value
of CO2 emissions reductions at each
TSL. DOE calculated domestic values as
a range from 7 percent to 23 percent of
the global values, and these results are
presented in chapter 14 of the NOPR
TSD.
TABLE V.46—GLOBAL PRESENT VALUE OF CO2 EMISSIONS REDUCTION FOR POTENTIAL STANDARDS FOR AUTOMATIC
COMMERCIAL ICE MAKERS
SCC Scenario *
TSL
5% discount
rate, average
3% discount
rate, average
2.5% discount
rate, average
3% discount
rate, 95th
percentile
million 2012$
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
Power Sector and Site Emissions
1
2
3
4
5
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
24.6
45.9
96.3
128.0
135.1
111.2
207.3
435.2
578.6
610.3
176.2
328.5
689.5
916.8
967.0
342.8
639.0
1,341.5
1,783.6
1,881.4
1.5
2.8
6.0
7.9
7.0
13.1
27.5
36.5
11.2
20.8
43.7
58.1
21.7
40.4
84.9
112.8
Upstream Emissions
1
2
3
4
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
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14934
Federal Register / Vol. 79, No. 51 / Monday, March 17, 2014 / Proposed Rules
TABLE V.46—GLOBAL PRESENT VALUE OF CO2 EMISSIONS REDUCTION FOR POTENTIAL STANDARDS FOR AUTOMATIC
COMMERCIAL ICE MAKERS—Continued
SCC Scenario *
TSL
5% discount
rate, average
5 .......................................................................................................................
3% discount
rate, average
2.5% discount
rate, average
3% discount
rate, 95th
percentile
8.4
38.5
61.3
119.0
26.1
48.7
102.3
136.0
143.4
118.2
220.4
462.6
615.1
648.8
187.4
349.3
733.2
974.9
1,028.3
364.5
679.5
1,426.3
1,896.4
2,000.4
Total Emissions
1
2
3
4
5
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
* For each of the four cases, the corresponding SCC value for emissions in 2015 is $11.8, $39.7, $61.2 and $117.0 per metric ton (2012$).
DOE is well aware that scientific and
economic knowledge about the
contribution of CO2 and other GHG
emissions to changes in the future
global climate and the potential
resulting damages to the world economy
continues to develop rapidly. Thus, any
value placed in this NOPR on reducing
CO2 emissions is subject to change.
DOE, together with other Federal
agencies, will continue to review
various methodologies for estimating
the monetary value of reductions in CO2
and other GHG emissions. This ongoing
review will consider the comments on
this subject that are part of the public
record for this NOPR and other
rulemakings, as well as other
methodological assumptions and issues.
However, consistent with DOE’s legal
obligations, and taking into account the
uncertainty involved with this
particular issue, DOE has included in
this NOPR the most recent values and
analyses resulting from the ongoing
interagency review process.
DOE also estimated a range for the
cumulative monetary value of the
economic benefits associated with NOX
emission reductions anticipated to
result from amended automatic
commercial ice makers standards. Table
V.47 presents the present value of
cumulative NOX emissions reductions
for each TSL calculated using the
average dollar-per-ton values and 7percent and 3-percent discount rates.
TABLE V.47—PRESENT VALUE OF
NOX EMISSIONS REDUCTION FOR
POTENTIAL STANDARDS FOR AUTOMATIC COMMERCIAL ICE MAKERS—
Continued
TABLE V.47—PRESENT VALUE OF
NOX EMISSIONS REDUCTION FOR
POTENTIAL STANDARDS FOR AUTOMATIC COMMERCIAL ICE MAKERS
3%
Discount
rate
TSL
3%
Discount
rate
TSL
2
3
4
5
7%
Discount
rate
7%
Discount
rate
4.6
9.6
12.8
13.5
1.4
3.0
4.0
4.3
................................
................................
................................
................................
million 2012$
Power Sector and Site Emissions *
1
2
3
4
5
¥1.8
¥3.4
¥7.2
¥9.5
¥10.1
................................
................................
................................
................................
................................
¥1.3
¥2.4
¥5.0
¥6.6
¥7.0
Upstream Emissions
1
2
3
4
5
................................
................................
................................
................................
................................
4.3
8.0
16.8
22.3
23.6
2.1
3.8
8.0
10.7
11.3
Total Emissions
1 ................................
2.5
0.8
The NPV of the monetized benefits
associated with emission reductions can
be viewed as a complement to the NPV
of the customer savings calculated for
each TSL considered in this NOPR.
Table V.48 presents the NPV values that
result from adding the estimates of the
potential economic benefits resulting
from reduced CO2 and NOX emissions
in each of four valuation scenarios to
the NPV of consumer savings calculated
for each TSL considered in this
rulemaking, at both a 7-percent and a 3percent discount rate. The CO2 values
used in the table correspond to the four
scenarios for the valuation of CO2
emission reductions presented in
section IV.L.
TABLE V.48—AUTOMATIC COMMERCIAL ICE MAKERS TSLS: NET PRESENT VALUE OF CUSTOMER SAVINGS COMBINED
WITH NET PRESENT VALUE OF MONETIZED BENEFITS FROM CO2 AND NOX EMISSIONS REDUCTIONS
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
Consumer NPV at 3% discount rate added with:
SCC Value of
$11.8/metric
ton CO2* and
Medium Value
for NOX**
TSL
SCC Value of
$39.7/metric
ton CO2* and
Medium Value
for NOX**
SCC Value of
$61.2/metric
ton CO2* and
Medium Value
for NOX**
SCC Value of
$117.0/metric
ton CO2* and
Medium Value
for NOX**
billion 2012$
1
2
3
4
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
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0.859
1.863
1.387
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0.550
1.031
2.223
1.866
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0.620
1.160
2.494
2.226
0.797
1.490
3.187
3.148
14935
Federal Register / Vol. 79, No. 51 / Monday, March 17, 2014 / Proposed Rules
TABLE V.48—AUTOMATIC COMMERCIAL ICE MAKERS TSLS: NET PRESENT VALUE OF CUSTOMER SAVINGS COMBINED
WITH NET PRESENT VALUE OF MONETIZED BENEFITS FROM CO2 AND NOX EMISSIONS REDUCTIONS—Continued
Consumer NPV at 3% discount rate added with:
SCC Value of
$11.8/metric
ton CO2* and
Medium Value
for NOX**
TSL
SCC Value of
$39.7/metric
ton CO2* and
Medium Value
for NOX**
SCC Value of
$61.2/metric
ton CO2* and
Medium Value
for NOX**
SCC Value of
$117.0/metric
ton CO2* and
Medium Value
for NOX**
1.189
1.694
2.074
3.046
5 .......................................................................................................................
Consumer NPV at 7% discount rate added with:
SCC Value of
$11.8/metric
ton CO2* and
Medium Value
for NOX**
TSL
SCC Value of
$39.7/metric
ton CO2* and
Medium Value
for NOX**
SCC Value of
$61.2/metric
ton CO2* and
Medium Value
for NOX**
SCC Value of
$117.0/metric
ton CO2* and
Medium Value
for NOX**
billion 2012$
1
2
3
4
5
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
0.224
0.418
0.896
0.624
0.518
0.317
0.590
1.257
1.103
1.023
0.386
0.719
1.527
1.463
1.403
0.563
1.049
2.220
2.385
2.375
* These label values represent the global SCC in 2015, in 2012$. The present values have been calculated with scenario-consistent discount
rates. For NOX emissions, each case uses the medium value, which corresponds to $2,639 per ton.
Although adding the value of
customer savings to the values of
emission reductions provides a valuable
perspective, the following should be
considered: (1) the national customer
savings are domestic U.S. customer
monetary savings found in market
transactions, while the values of
emission reductions are based on
estimates of marginal social costs,
which, in the case of CO2, are based on
a global value; and (2) the assessments
of customer savings and emissionrelated benefits are performed with
different computer models, leading to
different time frames for analysis. For
automatic commercial ice makers, the
present value of national customer
savings is measured for the period in
which units shipped (2018–2047)
continue to operate. However, the time
frames of the benefits associated with
the emission reductions differ. For
example, the value of CO2 emission
reductions in a given year reflects the
present value of all future climaterelated impacts due to emitting a ton of
CO2 in that year, out to the year 2100.
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
7. Other Factors
EPCA allows the Secretary, in
determining whether a proposed
standard is economically justified, to
consider any other factors that the
Secretary deems to be relevant. (42
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U.S.C. 6295(o)(2)(B)(i)(VII) and
6313(d)(4)) DOE considered LCC
impacts on identifiable groups of
customers, such as customers of
different business types, who may be
disproportionately affected by any
amended national energy conservation
standard level. DOE also considered the
reduction in generation capacity that
could result from the imposition of any
amended national energy conservation
standard level.
DOE carried out a RIA, as described
in the NOPR TSD chapter 17, to study
the impact of certain non-regulatory
alternatives that may encourage
customers to purchase higher efficiency
equipment and, thus, achieve NES. The
two major alternatives identified by
DOE are customer rebates and customer
tax credits. DOE surveyed the various
rebate programs available in the United
States. Typically, rebates are offered for
commercial sector businesses that
purchase energy-efficient automatic
commercial ice makers, typically,
machines that qualify either for
ENERGY STAR or CEE certification.
Rebates offered range from $40 to
several hundred dollars, depending on
the size and type of ice maker. Based on
the incremental costs DOE estimated for
TSL 1 (equivalent to the ENERGY STAR
targets that were in existence until early
in 2013), the rebates offered are
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sufficient to cover the incremental costs
of meeting the ENERGY STAR levels.
Given the range of rebates offered, DOE
elected to model rebates of equivalent to
60 percent of the full incremental cost
of the upgrades.
For the tax credits scenario, DOE did
not find a suitable program to model the
scenario. From a consumer perspective,
the most important difference between
rebate and tax credit programs is that a
rebate can be obtained relatively
quickly, whereas receipt of tax credits is
delayed until income taxes are filed or
a tax refund is provided by the IRS. As
with consumer rebates, DOE assumed
that consumer tax credits paid 60
percent of the incremental product
price, but estimated a different response
rate. The delay in reimbursement makes
tax credits less attractive than rebates;
consequently, DOE estimated a response
rate that is 80 percent of that for rebate
programs.
Table V.49 and Table V.50 show the
NES and NPV, respectively, for the nonregulatory alternatives analyzed. For
comparison, the table includes the
results of the NES and NPV for TSL 3,
the proposed energy conservation
standard. Energy savings are expressed
in quads in terms of primary or source
energy, which includes generation and
transmission losses from electricity
utility sector.
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TABLE V.49—CUMULATIVE NES OF NON-REGULATORY ALTERNATIVES COMPARED TO THE PROPOSED STANDARDS FOR
AUTOMATIC COMMERCIAL ICE MAKERS
Cumulative Primary NES
quads
Policy alternatives
No new regulatory action .............................................................................................................................................
Customer tax credits ....................................................................................................................................................
Customer rebates ........................................................................................................................................................
Voluntary energy efficiency targets .............................................................................................................................
Early replacement ........................................................................................................................................................
Proposed standards, primary energy (TSL 3) .............................................................................................................
0
0.145
0.190
0
0
0.281
TABLE V.50—CUMULATIVE NPV OF NON-REGULATORY ALTERNATIVES COMPARED TO THE PROPOSED STANDARDS FOR
AUTOMATIC COMMERCIAL ICE MAKERS
Cumulative net present value
billion 2012$
Policy alternatives
7% Discount
No new regulatory action .........................................................................................................................
Customer tax credits ................................................................................................................................
Customer rebates ....................................................................................................................................
Voluntary energy efficiency targets .........................................................................................................
Early replacement ....................................................................................................................................
Proposed standards (TSL 3) ...................................................................................................................
As shown above, none of the policy
alternatives DOE examined would
achieve close to the amount of energy or
monetary savings that could be realized
under the proposed amended standard.
Also, implementing either tax credits or
customer rebates would incur initial
and/or administrative costs that were
not considered in this analysis.
C. Proposed Standard
DOE recognizes that when it
considers amendments to the standards,
it is subject to the EPCA requirement
that any new or amended energy
conservation standard for any type (or
class) of covered product be designed to
achieve the maximum improvement in
energy efficiency that the Secretary
determines is technologically feasible
and economically justified. (42 U.S.C.
6295(o)(2)(A) and 6313(d)(4)) In
determining whether a proposed
standard is economically justified, the
Secretary must determine whether the
benefits of the standard exceed its
burdens to the greatest extent
practicable, in light of the seven
statutory factors discussed previously.
(42 U.S.C. 6295(o)(2)(B)(i) and
6313(d)(4)) The new or amended
standard must also result in a significant
conservation of energy. (42 U.S.C.
6295(o)(3)(B) and 6316(d)(4))
DOE considered the impacts of
standards at each TSL, beginning with
the maximum technologically feasible
level, to determine whether that level
met the evaluation criteria. If the maxtech level was not justified, DOE then
considered the next most-efficient level
and undertook the same evaluation until
it reached the highest efficiency level
that is both technologically feasible and
economically justified and saves a
significant amount of energy.
DOE discusses the benefits and/or
burdens of each TSL in the following
sections. DOE bases its discussion on
quantitative analytical results for each
3% Discount
0
0.520
0.678
0
0
0.791
0
1.011
1.319
0
0
1.751
TSL including NES, NPV (discounted at
7 and 3 percent), emission reductions,
INPV, LCC, and customers’ installed
price increases. Beyond the quantitative
results, DOE also considers other
burdens and benefits that affect
economic justification, including how
technological feasibility, manufacturer
costs, and impacts on competition may
affect the economic results presented.
Table V.51, Table V.52, Table V.53 and
Table V.54 present a summary of the
results of DOE’s quantitative analysis for
each TSL. Results in Table V.51 are
impacts from equipment purchased in
the period from 2018–2047. In addition
to the quantitative results presented in
the tables, DOE also considers other
burdens and benefits that affect
economic justification of certain
customer subgroups that are
disproportionately affected by the
proposed standards. Section V.B.7
presents the estimated impacts of each
TSL for these subgroups.
TABLE V.51—SUMMARY OF RESULTS FOR AUTOMATIC COMMERCIAL ICE MAKERS TSLS: NATIONAL IMPACTS*
Category
TSL 1
TSL 2
TSL 3
TSL 4
TSL 5
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
Cumulative National Energy Savings 2018 through 2047 quads
Undiscounted values ....................
0.073 .....................
0.136 .....................
0.286 .....................
0.380 .....................
0.401
Cumulative National Water Savings 2018 through 2047 billion gallons
Undiscounted values ....................
0.1 .........................
6.6 .........................
45.4 .......................
45.4 .......................
45.4
Cumulative NPV of Customer Benefits 2018 through 2047 2012$ billion
3% discount rate ...........................
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14937
Federal Register / Vol. 79, No. 51 / Monday, March 17, 2014 / Proposed Rules
TABLE V.51—SUMMARY OF RESULTS FOR AUTOMATIC COMMERCIAL ICE MAKERS TSLS: NATIONAL IMPACTS*—Continued
Category
TSL 1
TSL 2
TSL 3
TSL 4
TSL 5
7% discount rate ...........................
0.198 .....................
0.368 .....................
0.791 .....................
0.484 .....................
0.370
Industry Impacts
Change in Industry NPV (2012$
million).
Change in Industry NPV (%) ........
(8.4) to (8.7) ..........
(12.8) to (13.6) ......
(20.9) to (23.9) ......
(19.6) to (30.5) ......
(19.9) to (32.6)
(8.2) to (8.5) ..........
(12.6) to (13.4) ......
(20.5) to (23.5) ......
(19.2) to (30.0) ......
(19.5) to (32.0)
19.37 .....................
11.56 .....................
0.03 .......................
0.42 .......................
126.32 ...................
100.75 ...................
2518.64 .................
27.86 .....................
20.43
12.19
0.03
0.45
133.25
106.27
2656.69
29.38
Cumulative Emissions Reductions 2018 through 2047**
CO2 (MMt) ....................................
NOX (kt) ........................................
Hg (t) .............................................
N2O (kt) .........................................
N2O (kt CO2eq) ............................
CH4 (kt) .........................................
CH4 (kt CO2eq) .............................
SO2 (kt) .........................................
3.72 .......................
2.22 .......................
0.01 .......................
0.08 .......................
24.28 .....................
19.36 .....................
484.06 ...................
5.35 .......................
6.94 .......................
4.14 .......................
0.01 .......................
0.15 .......................
45.26 .....................
36.09 .....................
902.37 ...................
9.98 .......................
14.57 .....................
8.69 .......................
0.02 .......................
0.32 .......................
95.01 .....................
75.77 .....................
1894.29 .................
20.95 .....................
Monetary Value of Cumulative Emissions Reductions 2018 through 2047†
CO2 (2012$ billion) .......................
NOX—3% discount rate (2012$
million).
NOX—7% discount rate (2012$
million).
0.026 to 0.364 .......
2.5 .........................
0.049 to 0.679 .......
4.6 .........................
0.102 to 1.426 .......
9.6 .........................
0.136 to 1.896 .......
12.8 .......................
0.143 to 2.0
13.5
0.8 .........................
1.4 .........................
3.0 .........................
4.0 .........................
4.3
506 to 552 .............
518 to 572
Employment Impacts
Net Change in Indirect Domestic
Jobs by 2022.
100 to 101 .............
192 to 196 .............
431 to 442 .............
* Values in parentheses are negative numbers.
** ‘‘MMt’’ stands for million metric tons; ‘‘kt’’ stands for kilotons; ‘‘t’’ stands for tons. CO2eq is the quantity of CO2 that would have the same
global warming potential (GWP).
† Range of the economic value of CO2 reductions is based on estimates of the global benefit of reduced CO2 emissions. Economic value of
NOX reductions is based on estimates at $2,639/ton.
TABLE V.52—SUMMARY OF RESULTS FOR AUTOMATIC COMMERCIAL ICE MAKERS TSLS: MEAN LCC SAVINGS
[2012$]
Standard level
Equipment class
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
TSL1
IMH–W–Small–B ..................................................................
IMH–W–Med–B ....................................................................
IMH–W–Large–B* ................................................................
IMH–W–Large–B1 ........................................................
IMH–W–Large–B2 ........................................................
IMH–A–Small–B ...................................................................
IMH–A–Large–B* .................................................................
IMH–A–Large–B1 .........................................................
IMH–A–Large–B2 .........................................................
RCU–Large–B* ....................................................................
RCU–Large–B1 .............................................................
RCU–Large–B2 .............................................................
SCU–W–Large–B .................................................................
SCU–A–Small–B ..................................................................
SCU–A–Large–B ..................................................................
IMH–A–Small–C ...................................................................
IMH–A–Large–C ..................................................................
SCU–A–Small–C ..................................................................
TSL2
$199
464
833
701
1,260
254
648
590
960
875
847
1,298
483
103
140
315
660
93
TSL3
$215
464
833
701
1,260
259
633
572
960
875
847
1,298
687
198
522
314
744
140
TSL4
$328
587
833
701
1,260
396
1,127
1,168
908
983
963
1,277
694
396
502
391
1,026
146
$328
405
550
583
442
170
994
1,062
627
870
857
1,070
143
106
240
307
524
146
TSL5
$49
460
582
607
500
198
994
1,062
627
897
882
1,123
149
106
240
(237)
500
(441)
* LCC results for IMH–W–Large–B, IMH–A–Large–B, and RCU–Large–B are a weighted average of the two sub-equipment class level typical
units shown on the table, using weights provided in TSD chapter 7.
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TABLE V.53—SUMMARY OF RESULTS FOR AUTOMATIC COMMERCIAL ICE MAKERS TSLS: MEDIAN PAYBACK PERIOD
Standard Level
years
Equipment class
TSL1
IMH–W–Small–B ..................................................................
IMH–W–Med–B ....................................................................
IMH–W–Large–B* ................................................................
IMH–W–Large–B1 ........................................................
IMH–W–Large–B2 ........................................................
IMH–A–Small–B ...................................................................
IMH–A–Large–B* .................................................................
IMH–A–Large–B1 .........................................................
IMH–A–Large–B2 .........................................................
RCU–Large–B* ....................................................................
RCU–Large–B1 .............................................................
RCU–Large–B2 .............................................................
SCU–W–Large–B .................................................................
SCU–A–Small–B ..................................................................
SCU–A–Large–B ..................................................................
IMH–A–Small–C ...................................................................
IMH–A–Large–C ..................................................................
SCU–A–Small–C ..................................................................
TSL2
1.07
0.63
0.69
0.72
0.58
1.07
0.46
0.46
0.42
0.41
0.38
0.75
0.67
1.40
1.37
0.90
0.52
1.13
TSL3
1.26
0.63
0.69
0.72
0.58
1.22
0.49
0.50
0.42
0.41
0.38
0.75
0.76
1.52
1.17
0.90
0.53
1.53
TSL4
2.27
0.85
0.69
0.72
0.58
1.42
0.84
0.82
0.94
0.65
0.62
1.00
1.00
1.56
1.49
0.97
0.69
1.85
TSL5
2.27
3.33
3.59
3.75
3.10
4.32
2.16
2.08
2.58
2.39
2.37
2.70
3.01
4.79
3.72
2.59
3.25
1.85
5.42
3.22
3.60
3.77
3.02
4.24
2.16
2.08
2.58
2.44
2.42
2.70
3.00
4.79
3.72
6.83
3.24
19.12
* PBP results for IMH–W–Large–B, IMH–A–Large–B, and RCU–Large–B are weighted averages of the results for the two sub-equipment class
level typical units, using weights provided in TSD chapter 7.
TABLE V.54—SUMMARY OF RESULTS FOR AUTOMATIC COMMERCIAL ICE MAKER TSLS: DISTRIBUTION OF CUSTOMER LCC
IMPACTS
Standard Level
percentage of customers (%)
Category
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
TSL1
IMH–W–Small–B
Net Cost (%) .................................................................
No Impact (%) ...............................................................
Net Benefit (%) .............................................................
IMH–W–Med–B
Net Cost (%) .................................................................
No Impact (%) ...............................................................
Net Benefit (%) .............................................................
IMH–W–Large–B*
Net Cost (%) .................................................................
No Impact (%) ...............................................................
Net Benefit (%) .............................................................
IMH–W–Large–B1
Net Cost (%) .................................................................
No Impact (%) ...............................................................
Net Benefit (%) .............................................................
IMH–W–Large–B2
Net Cost (%) .................................................................
No Impact (%) ...............................................................
Net Benefit (%) .............................................................
IMH–A–Small–B
Net Cost (%) .................................................................
No Impact (%) ...............................................................
Net Benefit (%) .............................................................
IMH–A–Large–B*
Net Cost (%) .................................................................
No Impact (%) ...............................................................
Net Benefit (%) .............................................................
IMH–A–Large–B1
Net Cost (%) .................................................................
No Impact (%) ...............................................................
Net Benefit (%) .............................................................
IMH–A–Large–B2
Net Cost (%) .................................................................
No Impact (%) ...............................................................
Net Benefit (%) .............................................................
RCU–Large–B*
Net Cost (%) .................................................................
No Impact (%) ...............................................................
Net Benefit (%) .............................................................
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TSL2
TSL3
TSL4
TSL5
0.0
60.8
39.2
0.0
34.8
65.2
3.5
0.0
96.5
3.5
0.0
96.5
45.3
0.0
54.7
0.0
31.0
69.0
0.0
31.0
69.0
0.0
14.3
85.7
14.9
2.4
82.7
11.3
2.4
86.3
0.0
37.6
62.4
0.0
37.6
62.4
0.0
37.6
62.4
8.4
25.8
65.8
7.1
22.1
70.8
0.0
28.6
71.4
0.0
28.6
71.4
0.0
28.6
71.4
0.1
28.6
71.3
0.2
23.8
76.0
0.0
66.6
33.4
0.0
66.6
33.4
0.0
66.6
33.4
35.2
16.7
48.1
29.4
16.7
53.9
0.0
62.9
37.1
0.0
31.5
68.5
0.0
0.0
100.0
27.0
0.0
73.0
22.4
0.0
77.6
0.0
59.8
40.2
0.0
22.8
77.2
0.0
6.3
93.7
3.6
2.1
94.4
3.6
2.1
94.4
0.0
58.6
41.5
0.0
14.7
85.4
0.0
0.0
100.0
1.2
0.0
98.8
1.2
0.0
98.8
0.0
66.6
33.4
0.0
66.6
33.4
0.0
40.0
60.0
16.5
13.4
70.2
16.5
13.4
70.2
0.0
58.1
41.9
0.0
58.1
41.9
0.0
18.5
81.5
5.9
9.5
84.6
5.2
9.5
85.3
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TABLE V.54—SUMMARY OF RESULTS FOR AUTOMATIC COMMERCIAL ICE MAKER TSLS: DISTRIBUTION OF CUSTOMER LCC
IMPACTS—Continued
Standard Level
percentage of customers (%)
Category
TSL1
RCU–Large–B1
Net Cost (%) .................................................................
No Impact (%) ...............................................................
Net Benefit (%) .............................................................
RCU–Large–B2
Net Cost (%) .................................................................
No Impact (%) ...............................................................
Net Benefit (%) .............................................................
SCU–W–Large–B
Net Cost (%) .................................................................
No Impact (%) ...............................................................
Net Benefit (%) .............................................................
SCU–A–Small–B
Net Cost (%) .................................................................
No Impact (%) ...............................................................
Net Benefit (%) .............................................................
SCU–A–Large–B
Net Cost (%) .................................................................
No Impact (%) ...............................................................
Net Benefit (%) .............................................................
IMH–A–Small–C
Net Cost (%) .................................................................
No Impact (%) ...............................................................
Net Benefit (%) .............................................................
IMH–A–Large–C
Net Cost (%) .................................................................
No Impact (%) ...............................................................
Net Benefit (%) .............................................................
SCU–A–Small–C
Net Cost (%) .................................................................
No Impact (%) ...............................................................
Net Benefit (%) .............................................................
TSL2
TSL3
TSL4
TSL5
0.0
57.2
42.8
0.0
57.2
42.8
0.0
17.9
82.1
5.8
9.0
85.3
5.1
9.0
85.9
0.0
72.7
27.3
0.0
72.7
27.3
0.0
27.3
72.7
7.1
18.2
74.7
6.2
18.2
75.7
0.0
71.4
28.6
0.0
71.4
28.6
0.0
57.2
42.8
49.3
14.3
36.4
48.8
14.3
36.8
0.0
82.9
17.1
0.0
37.1
62.9
0.0
11.5
88.5
31.8
0.0
68.2
31.8
0.0
68.2
0.0
71.4
28.6
0.0
35.7
64.3
0.1
7.2
92.7
34.3
0.0
65.7
34.3
0.0
65.7
0.0
77.2
22.8
0.0
54.3
45.7
0.0
40.0
60.0
7.9
31.4
60.7
72.7
11.5
15.9
0.0
65.0
35.0
0.0
45.0
55.0
0.0
15.0
85.0
21.3
15.0
63.7
21.1
10.0
68.9
0.0
73.4
26.6
0.0
53.3
46.7
0.0
36.7
63.3
0.0
36.7
63.3
79.8
20.0
0.2
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
* LCC results for IMH–W–Large–B, IMH–A–Large–B, and RCU–Large–B are a weighted average of the two sub-equipment class level typical
units shown on the table.
DOE also notes that the economics
literature provides a wide-ranging
discussion of how consumers trade-off
upfront costs and energy savings in the
absence of government intervention.
Much of this literature attempts to
explain why consumers appear to
undervalue energy efficiency
improvements. This undervaluation
suggests that regulation that promotes
energy efficiency can produce
significant net private gains (as well as
producing social gains by, for example,
reducing pollution). There is evidence
that consumers undervalue future
energy savings as a result of (1) a lack
of information; (2) a lack of sufficient
salience of the long-term or aggregate
benefits; (3) a lack of sufficient savings
to warrant delaying or altering
purchases (e.g., an inefficient
ventilation fan in a new building or the
delayed replacement of a water pump);
(4) excessive focus on the short term, in
the form of inconsistent weighting of
future energy cost savings relative to
available returns on other investments;
(5) computational or other difficulties
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associated with the evaluation of
relevant tradeoffs; and (6) a divergence
in incentives (e.g., renter versus
building owner, builder versus home
buyer). Other literature indicates that
with less than perfect foresight and a
high degree of uncertainty about the
future, consumers may trade off these
types of investments at a higher-thanexpected rate between current
consumption and uncertain future
energy cost savings.
While DOE is not prepared at present
to provide a fuller quantifiable
framework for estimating the benefits
and costs of changes in consumer
purchase decisions due to an amended
energy conservation standard, DOE has
posted a paper that discusses the issue
of consumer welfare impacts of
appliance energy efficiency standards,
and potential enhancements to the
methodology by which these impacts
are defined and estimated in the
regulatory process.72 DOE is committed
72 Sanstad, A. Notes on the Economics of
Household Energy Consumption and Technology
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to developing a framework that can
support empirical quantitative tools for
improved assessment of the consumer
welfare impacts of appliance standards.
DOE welcomes comments on
information and methods to better
assess the potential impact of energy
conservation standards on consumer
choice and methods to quantify this
impact in its regulatory analysis in
future rulemakings.
TSL 5 corresponds to the max-tech
level for all the equipment classes and
offers the potential for the highest
cumulative energy savings through the
analysis period from 2018 to 2047. The
estimated energy savings from TSL 5 is
0.401 quads of energy, and potable
water savings are 45.4 billion gallons.
DOE projects a net positive NPV for
customers valued at $0.370 billion at a
7-percent discount rate. Estimated
emissions reductions are 20.4 MMt of
CO2, up to 12.2 kt of NOX and 0.03 tons
Choice. 2010. Lawrence Berkeley National
Laboratory, Berkeley, CA. www1.eere.energy.gov/
buildings/appliance_standards/pdfs/consumer_ee_
theory.pdf.
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of Hg. The CO2 emissions have a value
of up to $2.0 billion and the NOX
emissions have a value of up to $7.8
million at a 7-percent discount rate.
For TSL 5, with the exception of
equipment class IMH–A–Small–C and
SCU–A–Small–C, the mean LCC savings
for all equipment classes are positive,
implying a decrease in LCC, with the
decrease ranging from $49 for the IMH–
W–Small–B equipment class to $945 for
the IMH–A–Large–B equipment class.73
Although the mean LCC decreases
indicate a savings potential for
commercial ice makers as a whole, the
results shown on Table V.54 indicates a
large fraction of customers would
experience net LCC increases (i.e., LCC
costs rather than savings) from adoption
of TSL 5, with 30 to nearly 80 percent
of customers experiencing net LCC
increases in six equipment classes. As
shown on Table V.53, customers in 10
equipment classes would experience
payback periods of 3 years or longer.
At TSL 5, manufacturers may
experience a loss of INPV due to large
investments in product development
and manufacturing capital as nearly all
products will need substantial redesign
and existing production lines will need
to be adapted to produce evaporators
and cabinets, among other components,
for the newly compliant designs. Where
these designs may differ considerably
from those currently available, this TSL
also presents a significant testing
burden. The projected change in INPV
ranges from a decrease of $32.6 million
to a decrease of $19.9 million depending
on the chosen manufacturer markup
scenario. The upper bound of a $19.9
million decrease in INPV is considered
an optimistic scenario for manufacturers
because it assumes they can maintain
the same gross margin (as a percentage
of revenue) on their sales. DOE
recognizes the risk of large negative
impacts on industry if manufacturers’
expectations concerning reduced profit
margins are realized. TSL 5 could
reduce the INPV for automatic
commercial ice makers by up to 32.0
percent if impacts reach the lower
bound of the range, which represents a
scenario in which manufacturers cannot
fully mark up the increased equipment
costs, and therefore cannot maintain the
same overall gross margins (as a
percentage of revenue) they would have
in the base case.
In addition to the estimated impacts
on INPV, the impacts on manufacturing
capacity and competition are of concern
73 Two of the typical units modeled for the three
large batch classes have higher savings. For this
section of the NOPR, the discussion is limited to
results for full equipment classes.
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at TSL 5. While more than half of the
manufacturers who produce continuous
products, already offer at least one
product that complies with TSL 5, only
two manufacturers currently produce
batch commercial ice makers that
comply with the efficiency levels
specified at TSL 5. This includes one
small business manufacturer whose
niche products have among the very
largest harvest capacities in their
respective equipment classes and are
sold in small quantities relative to the
rest of the industry. In contrast to this
small business manufacturer, the other
manufacturer is Hoshizaki, which
produces more mainstream batch
products and commands substantial
market share.
The concentration of current
production of batch commercial ice
makers at TSL 5 presents two issues.
Hoshizaki holds intellectual property
covering the design of the evaporator
used in their batch equipment, which
limits the range of possible alternative
paths to achieving the efficiency levels
for batch equipment specified at TSL 5.
While the engineering analysis
identified other means to achieve these
high efficiencies, given this limitation
on design options, other manufacturers
expressed significant doubts regarding
their ability to do so. Further, DOE’s
analysis indicates that these efficiency
levels require the use of permanent
magnet motors and, for batch
equipment, drain water heat exchangers.
DOE was able to identify only one
supplier of the latter technology, whose
design is patented. In addition, there is
currently very limited use of permanent
magnet motors in commercial ice
makers; hence, motor suppliers would
be required to develop and initiate
production for a broad range of new
motor designs suitable for automatic
commercial ice makers. These needs
could severely impact automatic
commercial ice maker manufacturers’
ability to procure the required
components in sufficient quantities to
supply the market.
Assuming the other paths to achieving
these efficiency levels prove fruitful,
TSL 5 would still require that every
other manufacturer retool their entire
batch equipment production lines.
Further, DOE review of the efficiency
levels of available equipment shows that
only 13 percent of Hoshizaki’s batch
products meet the TSL 5 efficiency
levels, suggesting that the vast majority
of their production lines would also
require redesign and retooling. In
confidential interviews, one
manufacturer cited the possibility of a 3month to 6-month shutdown in the
event that amended standards were set
PO 00000
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high enough to require retooling of their
entire product line. Compounding this
effect across the industry could severely
impact manufacturing capacity in the
interim period between the
announcement of the standards and the
compliance date.
After carefully considering the
analysis results and weighing the
benefits and burdens of TSL 5, DOE
finds that at TSL 5, the benefits to the
Nation in the form of energy savings and
emissions reductions plus an increase of
$0.370 billion in customer NPV are
weighed against a decrease of up to 32.0
percent in INPV. While most individual
customers purchasing automatic
commercial ice makers built to TSL 5
standards would be better off than in the
base case, most would face payback
periods in excess of 3 years. The limited
number of manufacturers currently
producing batch commercial ice makers
that meet this efficiency level is cause
for additional concern. After weighing
the burdens of TSL 5 against the
benefits, DOE finds TSL 5 not to be
economically justified. DOE does not
propose to adopt TSL 5 in this
rulemaking.
TSL 4, the next highest efficiency
level, corresponds to the highest
efficiency level with a positive NPV at
a 7-percent discount rate for all
equipment classes. The estimated
energy savings from 2018 to 2047 are
0.380 quads of energy and 45.4 billion
gallons of potable water—amounts DOE
deems significant. At TSL 4, DOE
projects an increase in customer NPV of
$0.484 billion (2012$) at a 7-percent
discount rate; estimated emissions
reductions of 19.4 MMt of CO2, 11.6 kt
of NOX, and 0.03 tons of Hg. The
monetary value of these emissions was
estimated to be up to $1.9 billion for
CO2 and up to $7.4 million for NOX at
a 7-percent discount rate.
At TSL 4, the mean LCC savings are
positive for all equipment classes. As
shown on Table V.52, mean LCC savings
vary from $106 for SCU–A–Small–B to
$945 for IMH–A–Large–B, which
implies that, on average, customers will
experience an LCC benefit. However, as
shown on Table V.54, for 11 of the 12
classes, at least some fraction of the
customers will experience net costs.
Customers in 3 classes would
experience net LCC costs of 30 percent
or more, with the percentage ranging up
to 49 percent for one equipment class.
Median payback periods range from 1.9
years up to 4.8 years, with 7 of the 12
directly analyzed classes exhibiting
payback periods over 3 years.
At TSL 4, the projected change in
INPV ranges from a decrease of $30.5
million to a decrease of $19.6 million.
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The impact on manufacturers at TSL 4
is not significantly different from that at
TSL 5 as the individual efficiency levels
for each equipment class at TSL 4 are
on average not significantly different
from those at TSL 5, and in several
instances they are the same. DOE
recognizes the risk of negative impacts
at TSL 4 if manufacturers’ expectations
concerning reduced profit margins are
realized. If the lower bound of ¥$30.5
million is reached, as DOE expects, TSL
4 could result in a net loss of 30.0
percent in INPV for manufacturers of
automatic commercial ice makers.
The impacts on manufacturing
capacity and competition are of concern
at TSL 4. While every manufacturer who
produces continuous equipment offers
at least one product that complies with
TSL 4, only two manufacturers
currently produce batch commercial ice
makers that comply with the efficiency
levels specified at TSL 4. This includes
one small business manufacturer whose
niche products have among the very
largest harvest capacities in their
respective equipment classes and are
sold in small quantities relative to the
rest of the industry. In contrast to this
small business manufacturer, the other
manufacturer is a larger manufacturer
which produces more mainstream batch
products and commands a substantial
market share.
The concentration of current
production at TSL 4 presents two issues.
One large manufacturer holds
intellectual property covering the
evaporator design used in their batch
equipment, which in turn limits the
range of possible alternative paths to
achieving the efficiency levels specified
at TSL 4. While the engineering analysis
identified other means to achieve these
high efficiencies, given this limitation
on design options, other manufacturers
expressed significant doubts regarding
their ability to do so. Further, DOE’s
analysis indicates that these efficiency
levels require the use of permanent
magnet motors and, for most batch
equipment, drain water heat exchangers.
DOE was able to identify only one
supplier of the latter technology, whose
design is patented. In addition, there is
currently very limited use of permanent
magnet motors in commercial ice
makers; hence, motor suppliers would
be required to develop and initiate
production for a broad range of new
motor designs suitable for automatic
commercial ice makers. These needs
could severely impact automatic
commercial ice maker manufacturers’
ability to procure the required
components in sufficient quantities to
supply the market.
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Assuming other paths to achieving
these efficiency levels prove fruitful,
TSL 4 would still require that every
other manufacturer retool their entire
batch equipment production lines. As
noted above, only 2 manufacturers
currently produce equipment that meets
TSL 4 efficiency levels, one of which is
a large manufacturer. DOE’s review of
the efficiency levels of available
equipment shows that only 14 percent
of the large manufacturer’s batch
products meet the TSL 4 efficiency
levels, suggesting the vast majority of
their production lines would also
require redesign and retooling. In
confidential interviews, another
manufacturer cited the possibility of a 3month to 6-month shutdown in the
event that amended standards were set
high enough to require retooling of their
entire product line. Compounding this
effect across the industry could severely
impact manufacturing capacity in the
interim period between the
announcement of the standards and the
compliance date.
After carefully considering the
analysis results and weighing the
benefits and burdens of TSL 4, DOE
finds that at TSL 4, the benefits to the
Nation in the form of energy savings and
emissions reductions plus an increase of
$0.484 billion in customer NPV are
weighed against a decrease of up to 30.0
percent in INPV. While most individual
customers purchasing automatic
commercial ice makers built to TSL 4
standards would be better off than in the
base case, customers in 7 of 12
equipment classes would face payback
periods in excess of 3 years. The limited
number of manufacturers currently
producing batch commercial ice makers
that meet this efficiency level is cause
for additional concern. After weighing
the burdens of TSL 4 against the
benefits, DOE finds TSL 4 not to be
economically justified. DOE does not
propose to adopt TSL 4 in this notice.
At TSL 3, the next highest efficiency
level, estimated energy savings from
2018 to 2047 are 0.286 quads of primary
energy and water savings are 45.4
billion gallons—amounts DOE considers
significant. TSL 3 was defined as the set
of efficiencies with the highest NPV for
each analyzed equipment class. At TSL
3, DOE projects an increase in customer
NPV of $0.791 billion at a 7-percent
discount rate, and an increase of $1.751
billion at a 3-percent discount rate.
Estimated emissions reductions are 14.6
MMt of CO2, up to 8.7 kt of NOX and
0.02 tons of Hg at TSL 3. The monetary
value of the CO2 emissions reductions
was estimated to be up to $1.4 billion
at TSL 3, while NOX emission
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14941
reductions at a 7-percent discount rate
were valued at up to $5.5 million.
At TSL 3, nearly all customers for all
equipment classes are shown to
experience positive LCC savings. As
shown on Table V.54, the percent of
customers experiencing a net cost
rounds to 0 in all but two classes—
SCU–A–Large–B with 0.1 percent and
IMH–W–Small–B with 3.5 percent of
customers exhibiting a net cost. The
payback period for IMH–W–Small–B is
2.3 years, while for all other equipment
classes the median payback periods are
1.9 years or less. LCC savings range from
$146 for SCU–A–Small–C to over $1,100
for IMH–A–Large–B.
At TSL 3, the projected change in
INPV ranges from a decrease of $23.9
million to a decrease of $20.9 million.
The three largest manufacturers, who
together represent an estimated 95
percent of the market, currently produce
a combined 38 compliant batch
products at TSL 3. Many of the gains in
efficiency needed to meet the standards
proposed at TSL 3 can be achieved
using higher efficiency components as
opposed to the redesign of systems
manufactured in-house and as such
require little change to existing
manufacturing capital. The lack of
green-field redevelopment or significant
recapitalization mitigates the risk of
disruption to manufacturing capacity in
the interim period between
announcement of the energy
conservation standards and the
compliance date.
At TSL 3, the monetized CO2
emissions reduction values range from
$0.102 to $1.426 billion. The monetized
CO2 emissions reduction at $39.7 per
ton in 2012$ is $0.463 billion. The
monetized NOX emissions reductions
calculated at an intermediate value of
$2,639 per ton in 2012$ are $3 million
at a 7-percent discount rate and $9.6
million at a 3-percent rate. These
monetized emissions reduction values
were added to the customer NPV at 3percent and 7-percent discount rates to
obtain values of $2.223 billion and
1.257 billion, respectively, at TSL 3. The
total customer and emissions benefits
are highest at TSL 3.
Nearly all customers are expected to
experience net benefits from equipment
built to TSL 3 levels. The payback
periods for TSL 3 are expected to be 2.3
years, or less.
After carefully considering the
analysis results and weighing the
benefits and burdens of TSL 3, DOE
believes that setting the standards for
automatic commercial ice makers at TSL
3 represents the maximum improvement
in energy efficiency that is
technologically feasible and
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economically justified. TSL 3 is
technologically feasible because the
technologies required to achieve these
levels already exist in the current
market and are available from multiple
manufacturers. TSL 3 is economically
justified because the benefits to the
Nation in the form of energy savings,
customer NPV at 3 percent and at 7
percent, and emissions reductions
outweigh the costs associated with
reduced INPV and potential effects of
reduced manufacturing capacity.
Therefore, DOE proposes the adoption
of amended energy conservation
standards for automatic commercial ice
makers at TSL 3.
DOE specifically seeks comment on
the magnitude of the estimated decline
in INPV at TSL 3 compared to the
baseline, and whether this impact could
risk industry consolidation. DOE also
specifically requests comment on
whether DOE should adopt TSL 4 or 5
and why., DOE may reexamine the
proposed level depending on the nature
of the information it receives during the
comment period and adjust its final
levels in response to that information.
VI. Procedural Issues and Regulatory
Review
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A. Review Under Executive Orders
12866 and 13563
Section 1(b)(1) of Executive Order
12866, ‘‘Regulatory Planning and
Review,’’ 58 FR 51735 (Oct. 4, 1993),
requires each agency to identify the
problem that it intends to address,
including, where applicable, the failures
of private markets or public institutions
that warrant new agency action, as well
as to assess the significance of that
problem. The problems that today’s
standards address are as follows:
1. There is a lack of consumer
information and/or information
processing capability about energy
efficiency opportunities in the
automatic commercial ice maker market.
2. There is asymmetric information
(one party to a transaction has more and
better information than the other) and/
or high transactions costs (costs of
gathering information and effecting
exchanges of goods and services).
3. There are external benefits resulting
from improved energy efficiency of
automatic commercial ice makers that
are not captured by the users of such
equipment. These benefits include
externalities related to environmental
protection and energy security that are
not reflected in energy prices, such as
reduced emissions of GHGs.
In addition, DOE has determined that
today’s regulatory action is an
‘‘economically significant regulatory
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action’’ under section 3(f)(1) of
Executive Order 12866. Accordingly,
section 6(a)(3) of the Executive Order
requires that DOE prepare an RIA on
today’s rule and that OIRA in OMB
review this rule. DOE presented to OIRA
for review the draft rule and other
documents prepared for this
rulemaking, including the RIA. DOE has
included these documents in the
rulemaking record. The assessments
prepared pursuant to Executive Order
12866 can be found in the TSD for this
rulemaking.
DOE has also reviewed this regulation
pursuant to Executive Order 13563,
issued on January 18, 2011. 76 FR 3821
(Jan. 21, 2011). Executive Order 13563
is supplemental to and explicitly
reaffirms the principles, structures, and
definitions governing regulatory review
established in Executive Order 12866.
To the extent permitted by law, agencies
are required by Executive Order 13563
to: (1) propose or adopt a regulation
only upon a reasoned determination
that its benefits justify its costs
(recognizing that some benefits and
costs are difficult to quantify); (2) tailor
regulations to impose the least burden
on society, consistent with obtaining
regulatory objectives, taking into
account, among other things, and to the
extent practicable, the costs of
cumulative regulations; (3) select, in
choosing among alternative regulatory
approaches, those approaches that
maximize net benefits (including
potential economic, environmental,
public health and safety, and other
advantages; distributive impacts; and
equity); (4) to the extent feasible, specify
performance objectives, rather than
specifying the behavior or manner of
compliance that regulated entities must
adopt; and (5) identify and assess
available alternatives to direct
regulation, including providing
economic incentives to encourage the
desired behavior, such as user fees or
marketable permits, or providing
information upon which choices can be
made by the public.
DOE emphasizes as well that
Executive Order 13563 requires agencies
to use the best available techniques to
quantify anticipated present and future
benefits and costs as accurately as
possible. In its guidance, ORIA has
emphasized that such techniques may
include identifying changing future
compliance costs that might result from
technological innovation or anticipated
behavioral changes. For the reasons
stated in the preamble, DOE believes
that today’s NOPR is consistent with
these principles, including the
requirement that, to the extent
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permitted by law, benefits justify costs
and that net benefits are maximized.
B. Review Under the Regulatory
Flexibility Act
The Regulatory Flexibility Act (5
U.S.C. 601 et seq.) requires preparation
of an initial regulatory flexibility
analysis (IRFA) for any rule that by law
must be proposed for public comment,
unless the agency certifies that the rule,
if promulgated, will not have a
significant economic impact on a
substantial number of small entities. As
required by Executive Order 13272,
‘‘Proper Consideration of Small Entities
in Agency Rulemaking’’ 67 FR 53461
(Aug. 16, 2002), DOE published
procedures and policies on February 19,
2003 to ensure that the potential
impacts of its rules on small entities are
properly considered during the
rulemaking process. 68 FR at 7990. DOE
has made its procedures and policies
available on the Office of the General
Counsel’s Web site (https://energy.gov/
gc/downloads/executive-order-13272consideration-small-entities-agencyrulemaking).
1. Description and Estimated Number of
Small Entities Regulated
For manufacturers of automatic
commercial ice makers, the SBA has set
a size threshold, which defines those
entities classified as ‘‘small businesses’’
for the purposes of the statute. DOE
used the SBA’s small business size
standards to determine whether any
small entities would be subject to the
requirements of the rule. 65 FR 30836,
30848 (May 15, 2000), as amended at 65
FR 53533, 53544 (Sept. 5, 2000) and
codified at 13 CFR part 121. The size
standards are listed by NAICS code and
industry description and are available
at: www.sba.gov/sites/default/files/files/
Size_Standards_Table.pdf.
Manufacturing of automatic
commercial ice makers is classified
under NAICS 333415, ‘‘AirConditioning and Warm Air Heating
Equipment and Commercial and
Industrial Refrigeration Equipment
Manufacturing,’’ which includes icemaking machinery manufacturing. The
SBA sets a threshold of 750 employees
or less for an entity to be considered as
a small business in this category.
During its market survey, DOE used
available public information to identify
potential small manufacturers. DOE’s
research involved industry trade
association membership directories
(including AHRI), public databases (e.g.,
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AHRI Directory,74 the SBA Database 75),
individual company Web sites, and
market research tools (e.g., Hoovers
reports 76) to create a list of companies
that manufacture or sell equipment
covered by this rulemaking. DOE also
asked stakeholders and industry
representatives if they were aware of
any other small manufacturers during
manufacturer interviews and at DOE
public meetings. DOE reviewed publicly
available data and contacted select
companies on its list, as necessary, to
determine whether they met the SBA’s
definition of a small business
manufacturer of covered automatic
commercial ice makers. DOE screened
out companies that do not offer
equipment covered by this rulemaking,
do not meet the definition of a ‘‘small
business,’’ or are foreign-owned.
DOE identified seven small domestic
businesses manufacturers of automatic
commercial ice makers operating in the
United States. DOE contacted each of
these companies, but only one accepted
the invitation to participate in a
confidential manufacturer impact
analysis interview with DOE
contractors.
2. Description and Estimate of
Compliance Requirements
DOE estimates that the seven small
domestic manufacturers of automatic
commercial ice makers identified by
DOE account for approximately 5
percent of industry shipments. While
small business manufacturers of
automatic commercial ice makers have
small overall market share, some hold
substantial market share in specific
equipment classes. Several of these
smaller firms specialize in producing
industrial ice machines and the covered
equipment they manufacture are
extensions of existing product lines that
fall within the range of capacity covered
by this rule. Others serve niche markets.
Most have substantial portions of their
business derived from equipment
outside the scope of this rulemaking,
but are still considered small businesses
based on the SBA limits for number of
employees.
At the proposed level, small business
manufacturers of automatic commercial
ice makers are expected to face negative
impacts on INPV that are more than
three times as severe as those felt by the
industry at large: A loss of 78.6 percent
of INPV for small businesses alone as
compared to a loss of 23.5 percent for
the industry at large. Where conversion
costs are driven by the number of
platforms requiring redesign at a
particular standard level, small business
manufacturers may be
disproportionately affected. Product
conversion costs including the
investments made to redesign existing
equipment to meet new or amended
standards or to develop entirely new
compliant equipment, as well as
industry certification costs, do not scale
with sales volume. As small
manufacturers’ investments are spread
over a much lower volume of
shipments, recovering the cost of
upfront investments is proportionately
more difficult.
Similarly, capital conversion costs
may disproportionately affect small
business manufacturers of automatic
commercial ice makers. Capital
conversion costs are projected to be
highest in the year preceding standards
as manufacturers retrofit production
lines to make compliant equipment. In
this year, capital conversion costs are
estimated to represent 97 percent of
typical capital expenditures for small
businesses, as compared to 34 percent
for the industry as a whole. Where the
covered equipment from several small
manufacturers are adaptations of larger
platforms with capacities above the
4,000 lb ice/24 hour threshold, it may
not prove economical for them to
retrofit an entire production line to meet
standards that only affect one product.
In confidential interviews,
manufacturers indicated that many
design options evaluated in the
engineering analysis (e.g., higher
efficiency motors and compressors)
14943
would require them to purchase more
expensive components. In many
industries, small manufacturers
typically pay higher prices for
components due to smaller purchasing
volumes while their large competitors
receive volume discounts. However, this
effect is diminished for the automatic
commercial ice maker manufacturing
industry for two distinct reasons. One
reason relates to the fact that the
automatic commercial ice maker
industry as a whole is a low volume
industry. In confidential interviews,
manufacturers indicated that they have
little influence over their suppliers,
suggesting the volume of their
component orders is similarly
insufficient to receive substantial
discounts. The second reason relates to
the fact that, for most small businesses,
the equipment covered by this
rulemaking represents only a fraction of
overall business. Where small
businesses are ordering similar
components for non-covered equipment,
their purchase volumes may not be as
low as is indicated by the total unit
shipments for small businesses. For
these reasons, it is expected that any
volume discount for components
enjoyed by large manufacturers would
not be substantially different from the
prices paid by small business
manufacturers.
To estimate how small manufacturers
would be potentially impacted, DOE
developed specific small business
inputs and scaling factors for the GRIM.
These inputs were scaled from those
used in the whole industry GRIM using
information about the product portfolios
of small businesses and the estimated
market share of these businesses in each
equipment class. DOE used this
information in the GRIM to estimate the
annual revenue, EBIT, R&D expense,
and capital expenditures for a typical
small manufacturer and to model the
impact on INPV. DOE then compared
these impacts to those modeled for the
industry at large. The results are shown
on Table VI.1 and Table VI.2.
TABLE VI.1—COMPARISON OF SMALL BUSINESS MANUFACTURERS OF AUTOMATIC COMMERCIAL ICE MAKER INPV TO
THAT OF THE INDUSTRY AT LARGE BY TSL UNDER THE PRESERVATION OF GROSS MARGIN MARKUP SCENARIO*
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TSL 1
Industry at Large—Impact on INPV ($2012) .......................
Industry at Large—Impact on INPV (%) ..............................
Small Businesses—Impact on INPV ($2012) ......................
Small Businesses—Impact on INPV (%) .............................
TSL 2
$(8.4)
(8.2)%
$(1.8)
(35.4)%
$(12.8)
(12.6)%
$(2.9)
(57.0)%
TSL 3
$(20.9)
(20.5)%
$(3.9)
(76.6)%
TSL 4
$(19.6)
(19.2)%
$(4.1)
(80.5)%
*Values in parentheses are negative numbers.
74 See www.ahridirectory.org/ahriDirectory/
pages/home.aspx.
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75 See https://dsbs.sba.gov/dsbs/search/dsp_
dsbs.cfm.
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76 See
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TSL 5
$(19.9)
(19.5)%
$(4.5)
(88.4)%
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TABLE VI.2—COMPARISON OF SMALL BUSINESS MANUFACTURERS OF AUTOMATIC COMMERCIAL ICE MAKER INPV TO
THAT OF THE INDUSTRY AT LARGE BY TSL UNDER THE PRESERVATION OF EBIT MARKUP SCENARIO
TSL 1
Industry at Large—Impact on INPV ($2012) .......................
Industry at Large—Impact on INPV (%) ..............................
Small Businesses—Impact on INPV ($2012) ......................
Small Businesses—Impact on INPV (%) .............................
TSL 2
$(8.7)
(8.5)%
$(1.8)
(35.4)%
$(13.6)
(13.4)%
$(3.0)
(58.9)%
TSL 3
$(23.9)
(23.5)%
$(4.0)
(78.6)%
TSL 4
$(30.5)
(30.0)%
$(4.6)
(90.3)%
TSL 5
$(32.6)
(32.0)%
$(5.1)
(100.2)%
*Values in parentheses are negative numbers.
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3. Duplication, Overlap, and Conflict
With Other Rules and Regulations
DOE is not aware of any rules or
regulations that duplicate, overlap, or
conflict with the rule being promulgated
today.
4. Significant Alternatives to the Rule
The primary alternatives to the
proposed rule are the other TSLs
besides the one being considered today,
TSL 3. DOE explicitly considered the
role of manufacturers, including small
manufacturers, in its selection of TSL 3
rather than TSLs 4 or 5. Though higher
TSLs result in greater energy savings for
the country, they would place
significant burdens on manufacturers.
Chapter 12 of the NOPR TSD contains
additional information about the impact
of this rulemaking on manufacturers.
In addition to the other TSLs being
considered, chapter 17 of the NOPR
TSD and Section V.B.7 include reports
on a regulatory impact analysis (RIA).
For automatic commercial ice makers,
the RIA discusses the following policy
alternatives: (1) No change in standard;
(2) customer rebates; (3) customer tax
credits; (4) manufacturer tax credits; and
(5) early replacement. While these
alternatives may mitigate to some
varying extent the economic impacts on
small entities compared to the amended
standards, DOE determined that the
energy savings of these regulatory
alternatives could be approximately
one-third to one-half less than the
savings that would be expected to result
from adoption of the amended standard
levels. Because of the significantly
lower savings, DOE rejected these
alternatives and proposes to adopt the
amended standards set forth in this
rulemaking.
However, DOE seeks comment and, in
particular, data on the impacts of this
rulemaking upon small businesses. (See
Issue 10 under ‘‘Issues on Which DOE
Seeks Comment’’ in section VII.E of this
NOPR.)
C. Review Under the Paperwork
Reduction Act
Manufacturers of automatic
commercial ice makers must certify to
DOE that their equipment comply with
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any applicable energy conservation
standards. In certifying compliance,
manufacturers must test their
equipment according to the DOE test
procedures for automatic commercial
ice makers, including any amendments
adopted for those test procedures. DOE
has established regulations for the
certification and recordkeeping
requirements for all covered consumer
products and commercial/industrial
equipment, including automatic
commercial ice makers. 76 FR 12422
(March 7, 2011). The collection-ofinformation requirement for the
certification and recordkeeping is
subject to review and approval by OMB
under the Paperwork Reduction Act
(PRA). This requirement has been
approved by OMB under OMB Control
Number 1910–1400. Public reporting
burden for the certification is estimated
to average 20 hours per response,
including the time for reviewing
instructions, searching existing data
sources, gathering and maintaining the
data needed, and completing and
reviewing the collection of information.
Notwithstanding any other provision
of the law, no person is required to
respond to, nor shall any person be
subject to a penalty for failure to comply
with, a collection of information subject
to the requirements of the PRA, unless
that collection of information displays a
currently valid OMB Control Number.
D. Review Under the National
Environmental Policy Act of 1969
Pursuant to the National
Environmental Policy Act (NEPA) of
1969, (42 U.S.C. 4321 et seq.) DOE has
determined that the proposed rule fits
within the category of actions included
in Categorical Exclusion (CX) B5.1 and
otherwise meets the requirements for
application of a CX. See 10 CFR part
1021, appendix B, B5.1(b); 1021.410(b)
and appendix B, B(1)-(5). The proposed
rule fits within the category of actions
because it is a rulemaking that
establishes energy conservation
standards for consumer products or
industrial equipment, and for which
none of the exceptions identified in CX
B5.1(b) apply. Therefore, DOE has made
a CX determination for this rulemaking,
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and DOE does not need to prepare an
Environmental Assessment or
Environmental Impact Statement for
this proposed rule. DOE’s CX
determination for this proposed rule is
available at https://energy.gov/nepa/
downloads/cx-008014-categoricalexclusion-determination.
E. Review Under Executive Order 13132
Executive Order 13132, ‘‘Federalism,’’
64 FR 43255 (Aug. 10, 1999), imposes
certain requirements on Federal
agencies formulating and implementing
policies or regulations that preempt
State law or that have Federalism
implications. The Executive Order
requires agencies to examine the
constitutional and statutory authority
supporting any action that would limit
the policymaking discretion of the
States and to carefully assess the
necessity for such actions. The
Executive Order also requires agencies
to have an accountable process to
ensure meaningful and timely input by
State and local officials in the
development of regulatory policies that
have Federalism implications. On
March 14, 2000, DOE published a
statement of policy describing the
intergovernmental consultation process
it will follow in the development of
such regulations. 65 FR at 13735. EPCA
governs and prescribes Federal
preemption of State regulations as to
energy conservation for the products
that are the subject of today’s proposed
rule. States can petition DOE for
exemption from such preemption to the
extent, and based on criteria, set forth in
EPCA. (42 U.S.C. 6297) No further
action is required by Executive Order
13132.
F. Review Under Executive Order 12988
With respect to the review of existing
regulations and the promulgation of
new regulations, section 3(a) of
Executive Order 12988, ‘‘Civil Justice
Reform,’’ imposes on Federal agencies
the general duty to adhere to the
following requirements: (1) Eliminate
drafting errors and ambiguity; (2) write
regulations to minimize litigation; and
(3) provide a clear legal standard for
affected conduct rather than a general
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standard and promote simplification
and burden reduction. 61 FR 4729 (Feb.
7, 1996). Section 3(b) of Executive Order
12988 specifically requires that
Executive agencies make every
reasonable effort to ensure that the
regulation: (1) Clearly specifies the
preemptive effect, if any; (2) clearly
specifies any effect on existing Federal
law or regulation; (3) provides a clear
legal standard for affected conduct
while promoting simplification and
burden reduction; (4) specifies the
retroactive effect, if any; (5) adequately
defines key terms; and (6) addresses
other important issues affecting clarity
and general draftsmanship under any
guidelines issued by the Attorney
General. Section 3(c) of Executive Order
12988 requires Executive agencies to
review regulations in light of applicable
standards in section 3(a) and section
3(b) to determine whether they are met
or it is unreasonable to meet one or
more of them. DOE has completed the
required review and determined that, to
the extent permitted by law, this
proposed rule meets the relevant
standards of Executive Order 12988.
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G. Review Under the Unfunded
Mandates Reform Act of 1995
Title II of the Unfunded Mandates
Reform Act of 1995 (UMRA) requires
each Federal agency to assess the effects
of Federal regulatory actions on State,
local, and Tribal governments and the
private sector. Public Law 104–4, sec.
201 (codified at 2 U.S.C. 1531). For a
proposed regulatory action likely to
result in a rule that may cause the
expenditure by State, local, and Tribal
governments, in the aggregate, or by the
private sector of $100 million or more
in any one year (adjusted annually for
inflation), section 202 of UMRA requires
a Federal agency to publish a written
statement that estimates the resulting
costs, benefits, and other effects on the
national economy. (2 U.S.C. 1532(a),(b))
The UMRA also requires a Federal
agency to develop an effective process
to permit timely input by elected
officers of State, local, and Tribal
governments on a proposed ‘‘significant
intergovernmental mandate,’’ and
requires an agency plan for giving notice
and opportunity for timely input to
potentially affected small governments
before establishing any requirements
that might significantly or uniquely
affect small governments. On March 18,
1997, DOE published a statement of
policy on its process for
intergovernmental consultation under
UMRA. 62 FR at 12820. DOE’s policy
statement is also available at https://
energy.gov/gc/downloads/unfunded-
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mandates-reform-actintergovernmental-consultation.
Although today’s proposed rule does
not contain a Federal intergovernmental
mandate, it may require expenditures of
$100 million or more on the private
sector. Specifically, the proposed rule
will likely result in a final rule that
could require expenditures of $100
million or more. Such expenditures may
include: (1) Investment in research and
development and in capital
expenditures by automatic commercial
ice makers manufacturers in the years
between the final rule and the
compliance date for the new standards;
and (2) incremental additional
expenditures by customers to purchase
higher efficiency automatic commercial
ice makers, starting at the compliance
date for the applicable standard.
Section 202 of UMRA authorizes a
Federal agency to respond to the content
requirements of UMRA in any other
statement or analysis that accompanies
the proposed rule. (2 U.S.C. 1532(c))
The content requirements of section
202(b) of UMRA relevant to a private
sector mandate substantially overlap the
economic analysis requirements that
apply under section 325(o) of EPCA and
Executive Order 12866. The
SUPPLEMENTARY INFORMATION section of
this NOPR and the ‘‘Regulatory Impact
Analysis’’ section of the NOPR TSD for
this proposed rule respond to those
requirements.
Under section 205 of UMRA, DOE is
obligated to identify and consider a
reasonable number of regulatory
alternatives before promulgating a rule
for which a written statement under
section 202 is required. (2 U.S.C.
1535(a)) DOE is required to select from
those alternatives the most cost-effective
and least burdensome alternative that
achieves the objectives of the proposed
rule unless DOE publishes an
explanation for doing otherwise, or the
selection of such an alternative is
inconsistent with law. As required by 42
U.S.C. 6295(o) and 6313(d), this
proposed rule would establish energy
conservation standards for automatic
commercial ice makers that are designed
to achieve the maximum improvement
in energy efficiency that DOE has
determined to be both technologically
feasible and economically justified. A
full discussion of the alternatives
considered by DOE is presented in the
‘‘Regulatory Impact Analysis’’ section of
the TSD for today’s proposed rule.
H. Review Under the Treasury and
General Government Appropriations
Act, 1999
Section 654 of the Treasury and
General Government Appropriations
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14945
Act, 1999 (Pub. L. 105–277) requires
Federal agencies to issue a Family
Policymaking Assessment for any rule
that may affect family well-being. This
rule would not have any impact on the
autonomy or integrity of the family as
an institution. Accordingly, DOE has
concluded that it is not necessary to
prepare a Family Policymaking
Assessment.
I. Review Under Executive Order 12630
DOE has determined, under Executive
Order 12630, ‘‘Governmental Actions
and Interference with Constitutionally
Protected Property Rights,’’ 53 FR 8859
(Mar. 18, 1988), that this regulation
would not result in any takings that
might require compensation under the
Fifth Amendment to the U.S.
Constitution.
J. Review Under the Treasury and
General Government Appropriations
Act, 2001
Section 515 of the Treasury and
General Government Appropriations
Act, 2001 (44 U.S.C. 3516, note)
provides for Federal agencies to review
most disseminations of information to
the public under guidelines established
by each agency pursuant to general
guidelines issued by OMB. OMB’s
guidelines were published at 67 FR
8452 (Feb. 22, 2002), and DOE’s
guidelines were published at 67 FR
62446 (Oct. 7, 2002). DOE has reviewed
today’s NOPR under the OMB and DOE
guidelines and has concluded that it is
consistent with applicable policies in
those guidelines.
K. Review Under Executive Order 13211
Executive Order 13211, ‘‘Actions
Concerning Regulations That
Significantly Affect Energy Supply,
Distribution, or Use,’’ 66 FR 28355 (May
22, 2001), requires Federal agencies to
prepare and submit to OIRA at OMB a
Statement of Energy Effects for any
proposed significant energy action. A
‘‘significant energy action’’ is defined as
any action by an agency that
promulgates or is expected to lead to
promulgation of a final rule, and that:
(1) Is a significant regulatory action
under Executive Order 12866, or any
successor order; and (2) is likely to have
a significant adverse effect on the
supply, distribution, or use of energy, or
(3) is designated by the Administrator of
OIRA as a significant energy action. For
any proposed significant energy action,
the agency must give a detailed
statement of any adverse effects on
energy supply, distribution, or use
should the proposal be implemented,
and of reasonable alternatives to the
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action and their expected benefits on
energy supply, distribution, and use.
DOE has tentatively concluded that
today’s regulatory action, which sets
forth proposed energy conservation
standards for automatic commercial ice
makers, is not a significant energy
action because the proposed standards
are not likely to have a significant
adverse effect on the supply,
distribution, or use of energy, nor has it
been designated as such by the
Administrator at OIRA. Accordingly,
DOE has not prepared a Statement of
Energy Effects on the proposed rule.
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L. Review Under the Information
Quality Bulletin for Peer Review
On December 16, 2004, OMB, in
consultation with the Office of Science
and Technology Policy (OSTP), issued
its Final Information Quality Bulletin
for Peer Review (the Bulletin). 70 FR
2664 (Jan. 14, 2005). The Bulletin
establishes that certain scientific
information shall be peer-reviewed by
qualified specialists before it is
disseminated by the Federal
Government, including influential
scientific information related to agency
regulatory actions. The purpose of the
Bulletin is to enhance the quality and
credibility of the Government’s
scientific information. Under the
Bulletin, the energy conservation
standards rulemaking analyses are
‘‘influential scientific information,’’
which the Bulletin defines as scientific
information the agency reasonably can
determine will have, or does have, a
clear and substantial impact on
important public policies or private
sector decisions. 70 FR at 2667 (Jan. 14,
2005).
In response to OMB’s Bulletin, DOE
conducted formal in-progress peer
reviews of the energy conservation
standards development process and
analyses and has prepared a Peer
Review Report pertaining to the energy
conservation standards rulemaking
analyses. Generation of this report
involved a rigorous, formal, and
documented evaluation using objective
criteria and qualified and independent
reviewers to make a judgment as to the
technical/scientific/business merit, the
actual or anticipated results, and the
productivity and management
effectiveness of programs and/or
projects. The ‘‘Energy Conservation
Standards Rulemaking Peer Review
Report,’’ dated February 2007, has been
disseminated and is available at the
following Web site:
www1.eere.energy.gov/buildings/
appliance_standards/peer_review.html.
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VII. Public Participation
A. Attendance at the Public Meeting
The time, date, and location of the
public meeting are listed in the DATES
and ADDRESSES sections at the beginning
of this rulemaking. If you plan to attend
the public meeting, please notify Ms.
Brenda Edwards at (202) 586–2945 or
Brenda.Edwards@ee.doe.gov. Please
note that foreign nationals visiting DOE
Headquarters are subject to advance
security screening procedures. Any
foreign national wishing to participate
in the meeting should advise DOE as
soon as possible by contacting Ms.
Edwards to initiate the necessary
procedures. Please also note that those
wishing to bring laptops into the
Forrestal Building will be required to
obtain a property pass. Visitors should
avoid bringing laptops, or allow an extra
45 minutes. Persons can attend the
public meeting via webinar.
Webinar registration information,
participant instructions, and
information about the capabilities
available to webinar participants will be
published on DOE’s Web site at:
www1.eere.energy.gov/buildings/
appliance_standards/rulemaking.aspx/
ruleid/29.
Participants are responsible for
ensuring their systems are compatible
with the webinar software.
B. Procedure for Submitting Prepared
General Statements for Distribution
Any person who has plans to present
a prepared general statement may
request that copies of his or her
statement be made available at the
public meeting. Such persons may
submit requests, along with an advance
electronic copy of their statement in
PDF (preferred), Microsoft Word or
Excel, WordPerfect, or text (ASCII) file
format, to the appropriate address
shown in the ADDRESSES section at the
beginning of this notice. The request
and advance copy of statements must be
received at least one week before the
public meeting and may be emailed,
hand-delivered, or sent by mail. DOE
prefers to receive requests and advance
copies via email. Please include a
telephone number to enable DOE staff to
make follow-up contact, if needed.
C. Conduct of the Public Meeting
DOE will designate a DOE official to
preside at the public meeting and may
also use a professional facilitator to aid
discussion. The meeting will not be a
judicial or evidentiary-type public
hearing, but DOE will conduct it in
accordance with section 336 of EPCA
(42 U.S.C. 6306). A court reporter will
be present to record the proceedings and
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prepare a transcript. DOE reserves the
right to schedule the order of
presentations and to establish the
procedures governing the conduct of the
public meeting. After the public
meeting, interested parties may submit
further comments on the proceedings as
well as on any aspect of the rulemaking
until the end of the comment period.
The public meeting will be conducted
in an informal, conference style. DOE
will present summaries of comments
received before the public meeting,
allow time for prepared general
statements by participants, and
encourage all interested parties to share
their views on issues affecting this
rulemaking. Each participant will be
allowed to make a general statement
(within time limits determined by DOE),
before the discussion of specific topics.
DOE will allow, as time permits, other
participants to comment briefly on any
general statements.
At the end of all prepared statements
on a topic, DOE will permit participants
to clarify their statements briefly and
comment on statements made by others.
Participants should be prepared to
answer questions by DOE and by other
participants concerning these issues.
DOE representatives may also ask
questions of participants concerning
other matters relevant to this
rulemaking. The official conducting the
public meeting will accept additional
comments or questions from those
attending, as time permits. The
presiding official will announce any
further procedural rules or modification
of the above procedures that may be
needed for the proper conduct of the
public meeting.
A transcript of the public meeting will
be included in the docket, which can be
viewed as described in the Docket
section at the beginning of this
rulemaking. In addition, any person
may buy a copy of the transcript from
the transcribing reporter.
D. Submission of Comments
DOE will accept comments, data, and
information regarding this proposed
rule before or after the public meeting,
but no later than the date provided in
the DATES section at the beginning of
this proposed rule. Interested parties
may submit comments, data, and other
information using any of the methods
described in the ADDRESSES section at
the beginning of this notice.
Submitting comments via
regulations.gov. The regulations.gov
Web page will require you to provide
your name and contact information.
Your contact information will be
viewable to DOE Building Technologies
staff only. Your contact information will
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not be publicly viewable except for your
first and last names, organization name
(if any), and submitter representative
name (if any). If your comment is not
processed properly because of technical
difficulties, DOE will use this
information to contact you. If DOE
cannot read your comment due to
technical difficulties and cannot contact
you for clarification, DOE may not be
able to consider your comment.
However, your contact information
will be publicly viewable if you include
it in the comment itself or in any
documents attached to your comment.
Any information that you do not want
to be publicly viewable should not be
included in your comment, nor in any
document attached to your comment.
Otherwise, persons viewing comments
will see only first and last names,
organization names, correspondence
containing comments, and any
documents submitted with the
comments.
Do not submit to regulations.gov
information for which disclosure is
restricted by statute, such as trade
secrets and commercial or financial
information (hereinafter referred to as
Confidential Business Information
(CBI)). Comments submitted through
regulations.gov cannot be claimed as
CBI. Comments received through the
Web site will waive any CBI claims for
the information submitted. For
information on submitting CBI, see the
Confidential Business Information
section below.
DOE processes submissions made
through regulations.gov before posting.
Normally, comments will be posted
within a few days of being submitted.
However, if large volumes of comments
are being processed simultaneously,
your comment may not be viewable for
up to several weeks. Please keep the
comment tracking number that
regulations.gov provides after you have
successfully uploaded your comment.
Submitting comments via email, hand
delivery/courier, or mail. Comments and
documents submitted via email, hand
delivery, or mail also will be posted to
regulations.gov. If you do not want your
personal contact information to be
publicly viewable, do not include it in
your comment or any accompanying
documents. Instead, provide your
contact information in a cover letter.
Include your first and last names, email
address, telephone number, and
optional mailing address. The cover
letter will not be publicly viewable as
long as it does not include any
comments.
Include contact information each time
you submit comments, data, documents,
and other information to DOE. If you
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submit via mail or hand delivery/
courier, please provide all items on a
CD, if feasible. It is not necessary to
submit printed copies. No facsimiles
(faxes) will be accepted.
Comments, data, and other
information submitted to DOE
electronically should be provided in
PDF (preferred), Microsoft Word or
Excel, WordPerfect, or text (ASCII) file
format. Provide documents that are not
secured, that are written in English, and
that are free of any defects or viruses.
Documents should not contain special
characters or any form of encryption
and, if possible, they should carry the
electronic signature of the author.
Campaign form letters. Please submit
campaign form letters by the originating
organization in batches of between 50 to
500 form letters per PDF or as one form
letter with a list of supporters’ names
compiled into one or more PDFs. This
reduces comment processing and
posting time.
Confidential Business Information.
According to 10 CFR 1004.11, any
person submitting information that he
or she believes to be confidential and
exempt by law from public disclosure
should submit via email, postal mail, or
hand delivery/courier two well-marked
copies: one copy of the document
marked confidential including all the
information believed to be confidential,
and one copy of the document marked
non-confidential with the information
believed to be confidential deleted.
Submit these documents via email or on
a CD, if feasible. DOE will make its own
determination about the confidential
status of the information and treat it
according to its determination.
Factors of interest to DOE when
evaluating requests to treat submitted
information as confidential include: (1)
A description of the items; (2) whether
and why such items are customarily
treated as confidential within the
industry; (3) whether the information is
generally known by or available from
other sources; (4) whether the
information has previously been made
available to others without obligation
concerning its confidentiality; (5) an
explanation of the competitive injury to
the submitting person which would
result from public disclosure; (6) when
such information might lose its
confidential character due to the
passage of time; and (7) why disclosure
of the information would be contrary to
the public interest.
It is DOE’s policy that all comments
may be included in the public docket,
without change and as received,
including any personal information
provided in the comments (except
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information deemed to be exempt from
public disclosure).
E. Issues on Which DOE Seeks Comment
Although DOE welcomes comments
on any aspect of this proposal, DOE is
particularly interested in receiving
comments and views of interested
parties concerning the following issues.
1. Standards Compliance Dates
EPCA requires that the amended
standards established in this rulemaking
must apply to equipment that is
manufactured on or after 3 years after
the final rule is published in the Federal
Register unless DOE determines, by
rule, that a 3-year period is inadequate,
in which case DOE may extend the
compliance date for that standard by an
additional 2 years. (42 U.S.C.
6313(d)(3)(C))
For the NOPR analyses, DOE assumed
a 3-year period to prepare for
compliance. DOE requests comments on
the January 1, 2018 effective date, and
whether a January 1, 2018 effective date
provides an inadequate period for
compliance and what economic impacts
would be mitigated by a later effective
date.
DOE also requests comment on
whether the 3-year period is adequate
for manufacturers to obtain more
efficient components from suppliers to
meet proposed revisions of standards.
More discussion on this topic can be
found in Section IV.B.1.g of today’s
NOPR.
2. Utilization Factors
The utilization factor represents the
percent of time that an ice maker
actively produces ice. Ice maker usage is
measured in terms of kilowatt-hours per
100 lb/24 hours, whereas subsequent
analyses require annual energy usage in
kilowatt-hours. Thus, a usage factor is
required to translate the potential
energy usage into estimated annual
usage. In the Framework document, the
Department presented a series of factors
for each type of building that represents
an ice maker market segment, and all
were set to 0.5, meaning all building
types would be modeled with a
utilization factor indicating that
equipment runs one-half of the time.
The Stakeholders pointed out that not
all building segments should be at 0.5,
but DOE did not receive any data or
information that DOE can use to
differentiate the utilization factor by
building type. DOE requests data for
individual building types. More
discussion on this topic can be found in
Section IV.G.3 of today’s NOPR.
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3. Baseline Efficiency
For this notice, DOE chose continuous
machine baselines at sufficiently high
energy use levels that they exclude
almost no equipment. DOE based the
baselines on online data from the AHRI
database. DOE requests comments on
the development of continuous type
equipment base efficiency levels and on
the availability of data on which to
create continuous machine baselines.
More discussion on this topic can be
found in Section IV.D.2.a of today’s
NOPR.
4. Screening Analysis
DOE requests comment on the
screening analysis and, specifically, the
design options DOE screened out of the
rulemaking analysis.
DOE considered whether design
options were technologically feasible;
practicable to manufacture, install, or
service; had adverse impacts on product
utility or product availability; or had
adverse impacts on health or safety. See
Section IV.C of today’s NOPR and
chapter 4 of the NOPR TSD for further
discussion of the screening analysis.
5. Maximum Technologically Feasible
Levels
DOE seeks comments on the
Maximum Technologically Feasible
levels proposed in Table III.2 and Table
III.3 of today’s notice. More discussion
on this topic can be found in Section
IV.D.2.e of today’s NOPR.
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6. Markups to Determine Price
DOE identified three major
distribution channels through which
automatic commercial ice maker
equipment is purchased by the enduser: (1) Manufacturer to end-user
(direct channel); (2) manufacturer to
wholesale distributor to end-user
(wholesaler channel); and (3)
manufacturer to distributor to dealer or
contractor to end-user (contractor
channel). DOE currently uses
mechanical contractor data to estimate
the contribution of local dealers or
contactors to end-user prices. DOE
requests specific input to improve the
cost estimation for the local dealer or
contractor component of markups. More
discussion on this topic can be found in
Section IV.E of today’s NOPR.
7. Equipment Life
For the NOPR analyses, DOE used an
8.5 years average life for all equipment
classes, with analyses based on a
lifetime distribution averaging 8.5 years.
(TSD chapter 9 discusses the
development of the distribution.) In
comments on the preliminary analysis,
one stakeholder stated that continuous
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machines might have shorter life spans.
DOE requests specific information to
determine whether continuous and
batch types should be analyzed using
different equipment life assumptions,
and if so, what they would be. More
discussion on this topic can be found in
Section IV.G.8 of today’s NOPR.
8. Installation Costs
Stakeholders commented that higher
efficiency equipment would incur
additional installation costs when
compared to the baseline equipment.
DOE requests specificity with respect to
this comment, with specific information
on design options that will increase
installation costs and specific
information to enable DOE to adjust
installation costs appropriately. More
discussion on this topic can be found in
Section IV.G.2.a of today’s NOPR.
9. Open- Versus Closed-Loop
Installations
Stakeholders commented that some
localities in the U.S. have instituted
local ordinances or laws precluding
installation of ice makers in open-loop
configurations. DOE requests
stakeholder assistance in quantifying
the impact of local regulations on the
prevalence of open-loop installations.
More discussion on this topic can be
found in Section IV.D.3.c of today’s
NOPR.
12. INPV Results and Impact of
Standards
Based on weighing of data, DOE is
recommending TSL 3 for the new and
amended automatic commercial ice
maker standards. DOE recognizes that
new and amended standards will have
impacts on industry net present value
results. DOE specifically seeks comment
on the magnitude of the estimated
decline in INPV at TSL 3 compared to
the baseline, and what impact this may
have on manufacturers. More discussion
on this topic can be found in Section
V.B.2 of today’s NOPR.
13. Small Businesses
During the Framework and February
2012 preliminary analysis public
meetings, DOE received many
comments regarding the potential
impacts of amended energy
conservation standards on small
business manufacturers of automatic
commercial ice makers. DOE
incorporated this feedback into its
analyses for the NOPR and has
presented its results in this notice and
the NOPR TSD. However, DOE seeks
comment and, in particular, additional
data, in its efforts to quantify the
impacts of this rulemaking on small
businesses. More discussion on this
topic can be found in Section IV.J.3.d of
today’s NOPR.
11. Intermittency of Manufacturer R&D
and Impact of Standards
14. Consumer Utility and Performance
DOE requests comment on whether
there are features or attributes of the
more energy-efficient automatic
commercial ice makers, including any
potential changes to the evaporator
design that would result in changes to
the ice style or changes in the chassis
size, that manufacturers would produce
to meet the standards in this proposed
rule that might affect how they would
be used by consumers. DOE requests
comment specifically on how any such
effects should be weighed in the choice
of standards for the automatic
commercial ice makers for the final rule.
More discussion on this topic can be
found in Section V.B.3 of today’s NOPR.
One manufacturer reported that a
previous round of standards required
nearly all of the company’s engineering
resources for between 1 and 2 years.
Where manufacturers may divert
existing R&D resources to compliance
related R&D efforts, DOE requests
additional comment on the impact on
innovation of compliance related R&D
efforts. Specifically, DOE requests
comment on how to quantify this
impact on innovation. More discussion
on this topic can be found in Section
IV.J of today’s NOPR.
15. Analysis Period
For this rulemaking, DOE analyzed
the effects of this proposal assuming
that the automatic commercial ice
makers would be available to purchase
for 30 years and undertook a sensitivity
analysis using 9 years rather than 30
years of product shipments. The choice
of a 30-year period of shipments is
consistent with the DOE analysis for
other products and commercial
equipment. The choice of a 9-year
period is a proxy for the timeline in
EPCA for the review of certain energy
10. Ice Maker Shipments by Type of
Equipment
DOE’s shipments forecast is based on
a single snapshot of shipments by the
type of equipment. Stakeholders at the
preliminary analysis phase suggested
that the equipment mix may be
changing over time. DOE requests
additional data concerning shipment
trends/forecasts. More discussion on
this topic can be found in Section
IV.H.1 of today’s NOPR.
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conservation standards and potential
revision of and compliance with such
revised standards. We are seeking input,
information and data on whether there
are ways to further refine the analytic
timeline. More discussion on this topic
can be found in Section IV.H.1 of
today’s NOPR.
16. Social Cost of Carbon
DOE solicits comment on the
application of the new SCC values used
to determine the social benefits of CO2
emissions reductions over the
rulemaking analysis period. (The
rulemaking analysis period covers from
2018 to 2047 plus the appropriated
number of years to account for the
lifetime of the equipment purchased
between 2018 and 2047.) In particular,
the agency solicits comment on the
agency’s derivation of SCC values after
2050 where the agency applied the
average annual growth rate of the SCC
estimates in 2040–2050 associated with
each of the four sets of values. More
discussion on this topic can be found in
Section IV.L.1 of today’s NOPR.
17. Remote to Rack Equipment
In the preliminary analysis, DOE
found that some high-capacity RCU–RCLarge-C ice makers are solely designed
to be used with compressor racks and
the racks’ associated condensers. DOE
requests comment and supporting data
on the overall market share of these
units and any expected market trends.
More discussion on this topic can be
found in Section IV.B.1.f of today’s
NOPR.
18. Design Options Associated With
Each TSL
Section V.A.1 of today’s NOPR
discusses the design options associated
with each TSL, for each analyzed
product class. DOE requests comment
and data related to the required
equipment size increases associated
with the design options at each TSL
levels. Chapter 5 of the NOPR TSD
contains full descriptions of the design
options and DOE’s analyses for the
equipment size increase associated with
the design options selected. DOE also
requests comments and data on the
efficiency gains associated with each set
of design options. Chapter 5 of the
NOPR TSD contains DOE’s analyses of
the efficiency gains for each design
option considered. Finally, DOE
requests comment and data on any
utility impacts associated with each set
of design options, such as potential icestyle changes.
19. Standard Levels for Batch-Type Ice
Makers Over 2,500 lbs Ice/24 Hours
DOE requests comment and data on
the viability of the proposed standard
levels selected for batch-type ice makers
with harvest capacities from 2,500 to
4,000 lb ice/24 hours. The proposed
standard levels are discussed in Section
V.A.2 of today’s NOPR, and prior
comments on standards for batch-type
ice makers with harvest capacities from
2,500 to 4,000 lb ice/24 hours are
discussed in Section IV.B.1.b of today’s
NOPR.
VIII. Approval of the Office of the
Secretary
The Secretary of Energy has approved
publication of today’s proposed rule.
List of Subjects in 10 CFR Part 431
Administrative practice and
procedure, Confidential business
information, Energy conservation,
Commercial equipment, Imports,
Intergovernmental relations, Reporting
and recordkeeping requirements, Small
businesses.
Issued in Washington, DC, on March 7,
2014.
David T. Danielson,
Assistant Secretary for Energy Efficiency,
Energy Efficiency and Renewable Energy.
For the reasons set forth in the
preamble, DOE proposes to amend part
431 of chapter II of title 10, of the Code
of Federal Regulations, as set forth
below:
PART 431—ENERGY EFFICIENCY
PROGRAM FOR CERTAIN
COMMERCIAL AND INDUSTRIAL
EQUIPMENT
1. The authority citation for part 431
continues to read as follows:
■
Authority: 42 U.S.C. 6291–6317.
2. Section 431.136 is revised to read
as follows:
■
§ 431.136 Energy conservation standards
and their effective dates.
(a) All basic models of commercial ice
makers must be tested for performance
using the applicable DOE test procedure
in § 431.134, be compliant with the
applicable standards set forth in
paragraphs (b) through (d) of this
section, and be certified to the
Department of Energy under 10 CFR
part 429.
(b) Each cube type automatic
commercial ice maker with capacities
between 50 and 2,500 pounds per 24hour period manufactured on or after
January 1, 2010 and before [DATE
THREE YEARS AFTER PUBLICATION
OF FINAL RULE], shall meet the
following standard levels:
Equipment type
Type of cooling
Rated harvest rate
lb ice/24 hours
Ice-Making Head ..................................................................
Water ................
<500
≥500 and <1,436
≥1,436
<450
≥450
<1,000
≥1,000
<934
≥934
<200
≥200
<175
≥175
Air .....................
Air .....................
Remote Condensing and Remote Compressor ..................
Air .....................
Self-Contained .....................................................................
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Remote Condensing (but not remote compressor) .............
Water ................
Air .....................
Maximum energy
use
kWh/100 lb ice
7.8–0.0055H**
5.58–0.0011H
4.0
10.26–0.0086H
6.89–0.0011H
8.85–0.0038H
5.1
8.85–0.0038H
5.3
11.40–0.019H
7.6
18.0–0.0469H
9.8
Maximum condenser water use*
gal/100 lb ice
200–0.022H.
200–0.022H.
200–0.022H.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable.
191–0.0315H.
191–0.0315H.
Not Applicable.
Not Applicable.
* Water use is for the condenser only and does not include potable water used to make ice.
** H = rated harvest rate in pounds per 24 hours, indicating the water or energy use for a given rated harvest rate.
Source: 42 U.S.C. 6313(d).
(c) Each batch type automatic
commercial ice maker with capacities
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PUBLICATION OF FINAL RULE], shall
meet the following standard levels:
Equipment type
Type of cooling
Rated harvest rate
lb ice/24 hours
Ice-Making Head ..................................................................
Water ................
Ice-Making Head ..................................................................
Air .....................
Remote Condensing (but Not Remote Compressor) ..........
Air .....................
Remote Condensing and Remote Compressor ..................
Air .....................
Self-Contained .....................................................................
Water ................
Self-Contained .....................................................................
Air .....................
<500
≥500 and <1,436
≥1,436 and <2,500
≥2,500 and <4,000
<450
≥450 and <875
≥875 and <2,210
≥2,210 and <2,500
≥2,500 and <4,000
<1,000
≥1,000 and <4,000
<934
≥934 and <4,000
<200
≥200 and <2,500
≥2,500 and <4,000
<175
≥175 and <4,000
Maximum energy
use
kWh/100 lb ice*
5.84–0.0041H
3.88–0.0002H
3.6
3.6
7.70–0.0065H
5.17–0.0008H
4.5
6.89–0.0011H
4.1
7.52—0.0032H
4.3
7.52–0.0032H
4.5
8.55–0.0143H
5.7
5.7
12.6–0.0328H
6.9
Maximum condenser water use**
gal/100 lb ice
200–0.022H.
200–0.022H.
200–0.022H
145.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable
Not Applicable.
Not Applicable.
Not Applicable.
191–0.0315H.
191–0.0315H.
112.
Not Applicable.
Not Applicable.
* H = rated harvest rate in pounds per 24 hours, indicating the water or energy use for a given rated harvest rate.
** Water use is for the condenser only and does not include potable water used to make ice.
Source: 42 U.S.C. 6313(d).
(d) Each continuous type automatic
commercial ice maker with capacities
between 50 and 4,000 pounds per 24-
hour period manufactured on or after
[DATE THREE YEARS AFTER
PUBLICATION OF FINAL RULE], shall
meet the following standard levels:
Equipment type
Type of cooling
Rated harvest rate
lb ice/24 hours
Ice-Making Head ..................................................................
Water ................
Ice-Making Head ..................................................................
Air .....................
Remote Condensing (but Not Remote Compressor) ..........
Air .....................
Remote Condensing and Remote Compressor ..................
Air .....................
Self-Contained .....................................................................
Water ................
Self-Contained .....................................................................
Air .....................
<900
≥900 and <2,500
≥ 2,500 and 4,000
<700
≥700 and <4,000
<850
≥850 and <4,000
<850
≥850 and <4,000
<900
≥900 and <2,500
≥2,500 and <4,000
<700
≥700 and <4,000
Maximum energy
use
kWh/100 lb ice*
6.08–0.0025H
3.8
3.8
9.24–0.0061H
5.0
7.50–0.0034H
4.6
7.65–0.0034H
4.8
7.28–0.0027H
4.9
4.9
9.20—0.0050H
5.7
* H = rated harvest rate in pounds per 24 hours, indicating the water or energy use for a given rated harvest rate.
** Water use is for the condenser only and does not include potable water used to make ice.
Source: 42 U.S.C. 6313(d).
[FR Doc. 2014–05566 Filed 3–14–14; 8:45 am]
mstockstill on DSK4VPTVN1PROD with PROPOSALS2
BILLING CODE 6450–01–P
VerDate Mar<15>2010
19:08 Mar 14, 2014
Jkt 232001
PO 00000
Frm 00106
Fmt 4701
Sfmt 9990
E:\FR\FM\17MRP2.SGM
17MRP2
Maximum condenser water use**
gal/100 lb ice
160–0.0176H.
160–0.0176H.
116.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable.
Not Applicable.
153–0.0252H.
153–0.0252H.
90.
Not Applicable.
Not Applicable.
Agencies
[Federal Register Volume 79, Number 51 (Monday, March 17, 2014)]
[Proposed Rules]
[Pages 14845-14950]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-05566]
[[Page 14845]]
Vol. 79
Monday,
No. 51
March 17, 2014
Part IV
Department of Energy
-----------------------------------------------------------------------
10 CFR Part 431
Energy Conservation Program: Energy Conservation Standards for
Automatic Commercial Ice Makers; Proposed Rule
Federal Register / Vol. 79 , No. 51 / Monday, March 17, 2014 /
Proposed Rules
[[Page 14846]]
-----------------------------------------------------------------------
DEPARTMENT OF ENERGY
10 CFR Part 431
[Docket Number EERE-2010-BT-STD-0037]
RIN 1904-AC39
Energy Conservation Program: Energy Conservation Standards for
Automatic Commercial Ice Makers
AGENCY: Office of Energy Efficiency and Renewable Energy, Department of
Energy.
ACTION: Notice of proposed rulemaking and public meeting.
-----------------------------------------------------------------------
SUMMARY: The Energy Policy and Conservation Act of 1975 (EPCA), as
amended, prescribes energy conservation standards for various consumer
products and certain commercial and industrial equipment, including
automatic commercial ice makers (ACIM). EPCA also requires the U.S.
Department of Energy (DOE) to determine whether more-stringent, amended
standards would be technologically feasible and economically justified,
and would save a significant amount of energy. In this notice, DOE
proposes amended energy conservation standards for automatic commercial
ice makers. The notice of proposed rulemaking also announces a public
meeting to receive comment on these proposed standards and associated
analyses and results.
DATES: DOE will accept comments, data, and information regarding this
notice of proposed rulemaking (NOPR) before and after the public
meeting, but no later than May 16, 2014. See section VII, ``Public
Participation,'' for details.
DOE will hold a public meeting on Monday, April 14, 2014, from 9
a.m. to 4 p.m., in Washington, DC. The meeting will also be broadcast
as a webinar. See section VII, ``Public Participation,'' for webinar
registration information, participant instructions, and information
about the capabilities available to webinar participants.
ADDRESSES: The public meeting will be held at the U.S. Department of
Energy, Forrestal Building, Room 8E-089, 1000 Independence Avenue SW.,
Washington, DC 20585. To attend, please notify Ms. Brenda Edwards at
(202) 586-2945. Persons can attend the public meeting via webinar. For
more information, refer to section VII, ``Public Participation.''
Any comments submitted must identify the NOPR for Energy
Conservation Standards for Automatic Commercial Ice Makers and provide
docket number EERE-2010-BT-STD-0037 and/or regulatory information
number (RIN) 1904-AC39. Comments may be submitted using any of the
following methods:
1. Federal eRulemaking Portal: www.regulations.gov. Follow the
instructions for submitting comments.
2. Email: ACIM-2010-STD-0037@ee.doe.gov. Include the docket number
and/or RIN in the subject line of the message.
3. 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
CD. It is not necessary to include printed copies.
4. Hand Delivery/Courier: Ms. Brenda Edwards, U.S. Department of
Energy, Building Technologies Program, 950 L'Enfant Plaza SW., Suite
600, 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.
Written comments regarding the burden-hour estimates or other
aspects of the collection-of-information requirements contained in this
proposed rule may be submitted to Office of Energy Efficiency and
Renewable Energy through the methods listed above and by email to
Chad_S_Whiteman@omb.eop.gov.
For detailed instructions on submitting comments and additional
information on the rulemaking process, see section VII of this document
(Public Participation).
Docket: The docket, which includes Federal Register notices, public
meeting attendee lists and transcripts, comments, and other supporting
documents/materials, is available for review at regulations.gov. All
documents in the docket are listed in the regulations.gov index.
However, some documents listed in the index, such as those containing
information that is exempt from public disclosure, may not be publicly
available.
The link to the docket Web page is the following:
www.regulations.gov/#!docketBrowser;rpp=25;po=0;D=EERE-2010-BT-STD-
0037. This Web page will contain a link to the docket for this proposed
rule on the regulations.gov site. The regulations.gov Web page will
contain simple instructions on how to access all documents, including
public comments, in the docket. See section VII for further information
on how to submit comments through www.regulations.gov.
For further 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.
FOR FURTHER INFORMATION CONTACT: Mr. John Cymbalsky, U.S. Department of
Energy, Office of Energy Efficiency and Renewable Energy, Building
Technologies Program, EE-2B, 1000 Independence Avenue SW., Washington,
DC 20585-0121. Telephone: (202) 287-1692. Email: automatic_commercial_ice_makers@ee.doe.gov.
Mr. Ari Altman, U.S. Department of Energy, Office of the General
Counsel, GC-71, 1000 Independence Avenue SW., Washington, DC 20585-
0121. Telephone: (202) 287-6307. Email: Ari.Altman@hq.doe.gov.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Summary of the Proposed Rule
A. Benefits and Costs to Customers
B. Impact on Manufacturers
C. National Benefits
II. Introduction
A. Authority
B. Background
1. Current Standards
2. History of Standards Rulemaking for Automatic Commercial Ice
Makers
III. General Discussion
A. List of Equipment Class Abbreviations
B. Test Procedures
C. Technological Feasibility
1. General
2. Maximum Technologically Feasible Levels
D. Energy and Water Savings
1. Determination of Savings
2. Significance of Savings
E. Economic Justification
1. Specific Criteria
a. Economic Impact on Manufacturers and Commercial Customers
b. Life-Cycle Costs
c. Energy Savings
d. Lessening of Utility or Performance of Equipment
e. Impact of Any Lessening of Competition
f. Need of the Nation To Conserve Energy
g. Other Factors
2. Rebuttable Presumption
IV. Methodology and Discussion of Comments
A. General Rulemaking Issues
1. Statutory Authority
2. Test Procedures
3. Need for and Scope of Rulemaking
B. Market and Technology Assessment
1. Equipment Classes
a. Cabinet Size
b. Large-Capacity Batch Ice Makers
c. Efficiency/Harvest Capacity Relationship
d. Continuous Ice Maker Equipment Classes
e. Remote Condensing Unit Classes for Equipment With and Without
Remote Compressors
f. Remote to Rack Equipment
g. Ice Makers Covered by the Energy Policy Act of 2005
[[Page 14847]]
h. Regulation of Potable Water Use
2. Technology Assessment
a. Reduced Potable Water Flow for Continuous Type Ice Makers
b. Alternative Refrigerants
C. Screening Analysis
a. Tube Evaporator Design
b. Low Thermal Mass Evaporator Design
c. Drain Water Heat Exchanger
d. Design Options That Necessitate Increased Cabinet Size
e. Microchannel Heat Exchangers
f. Smart Technologies
g. Screening Analysis: General Comments
D. Engineering Analysis
1. Representative Equipment for Analysis
2. Efficiency Levels
a. Baseline Efficiency Levels
b. Incremental Efficiency Levels
c. IMH-A-Large-B Treatment
d. Maximum Available Efficiency Equipment
e. Maximum Technologically Feasible Efficiency Levels
f. Comment Discussion
3. Design Options
a. Improved Condenser Performance in Batch Equipment
b. Harvest Capacity Oversizing
c. Open-Loop Condensing Water Designs
d. Condenser Water Flow
e. Compressors
4. Development of the Cost-Efficiency Relationship
a. Manufacturing Cost
b. Energy Consumption Model
c. Retail Cost Review
d. Design, Development, and Testing Costs
e. Empirical-Based Analysis
f. Revision of Preliminary Engineering Analysis
E. Markups Analysis
F. Energy Use Analysis
G. Life-Cycle Cost and Payback Period Analysis
1. Equipment Cost
2. Installation, Maintenance, and Repair Costs
a. Installation Costs
b. Repair and Maintenance Costs
3. Annual Energy and Water Consumption
4. Energy Prices
5. Energy Price Projections
6. Water Prices
7. Discount Rates
8. Lifetime
9. Compliance Date of Standards
10. Base-Case and Standards-Case Efficiency Distributions
11. Inputs to Payback Period Analysis
12. Rebuttable Presumption Payback Period
H. National Impact Analysis--National Energy Savings and Net
Present Value
1. Shipments
2. Forecasted Efficiency in the Base Case and Standards Cases
3. National Energy Savings
4. Net Present Value of Customer Benefit
I. Customer Subgroup Analysis
J. Manufacturer Impact Analysis
1. Overview
2. Government Regulatory Impact Model
a. Government Regulatory Impact Model Key Inputs
b. Government Regulatory Impact Model Scenarios
3. Discussion of Comments
a. Impact to Suppliers, Distributors, Dealers, and Contractors
b. ENERGY STAR
c. Cumulative Regulatory Burden
d. Small Manufacturers
4. Manufacturer Interviews
a. Price Sensitivity
b. Enforcement
c. Reliability Impacts
d. Impact on Innovation
K. Emissions Analysis
L. Monetizing Carbon Dioxide and Other Emissions Impacts
1. Social Cost of Carbon
a. Monetizing Carbon Dioxide Emissions
b. Social Cost of Carbon Values Used in Past Regulatory Analyses
c. Current Approach and Key Assumptions
2. Valuation of Other Emissions Reductions
M. Utility Impact Analysis
N. Employment Impact Analysis
O. Regulatory Impact Analysis
V. Analytical Results
A. Trial Standard Levels
1. Trial Standard Level Formulation Process and Criteria
2. Trial Standard Level Equations
B. Economic Justification and Energy Savings
1. Economic Impacts on Commercial Customers
a. Life-Cycle Cost and Payback Period
b. Life-Cycle Cost Subgroup Analysis
2. Economic Impacts on Manufacturers
a. Industry Cash Flow Analysis Results
b. Impacts on Direct Employment
c. Impacts on Manufacturing Capacity
d. Impacts on Subgroups of Manufacturers
e. Cumulative Regulatory Burden
3. National Impact Analysis
a. Amount and Significance of Energy Savings
b. Net Present Value of Customer Costs and Benefits
c. Water Savings
d. Employment Impacts
4. Impact on Utility or Performance of Equipment
5. Impact of Any Lessening of Competition
6. Need of the Nation To Conserve Energy
7. Other Factors
C. Proposed Standard
VI. Procedural Issues and Regulatory Review
A. Review Under Executive Orders 12866 and 13563
B. Review Under the Regulatory Flexibility Act
1. Description and Estimated Number of Small Entities Regulated
2. Description and Estimate of Compliance Requirements
3. Duplication, Overlap, and Conflict With Other Rules and
Regulations
4. Significant Alternatives to the Rule
C. Review Under the Paperwork Reduction Act
D. Review Under the National Environmental Policy Act of 1969
E. Review Under Executive Order 13132
F. Review Under Executive Order 12988
G. Review Under the Unfunded Mandates Reform Act of 1995
H. Review Under the Treasury and General Government
Appropriations Act, 1999
I. Review Under Executive Order 12630
J. Review Under the Treasury and General Government
Appropriations Act, 2001
K. Review Under Executive Order 13211
L. Review Under the Information Quality Bulletin for Peer Review
VII. Public Participation
A. Attendance at the Public Meeting
B. Procedure for Submitting Prepared General Statements for
Distribution
C. Conduct of the Public Meeting
D. Submission of Comments
E. Issues on Which DOE Seeks Comment
1. Standards Compliance Dates
2. Utilization Factors
3. Baseline Efficiency
4. Screening Analysis
DOE considered whether design options were technologically
feasible; practicable to manufacture, install, or service; had
adverse impacts on product utility or product availability; or had
adverse impacts on health or safety. See Section IV.C of today's
NOPR and chapter 4 of the NOPR TSD for further discussion of the
screening analysis.
5. Maximum Technologically Feasible Levels
DOE seeks comments on the Maximum Technologically Feasible
levels proposed in Table III.2 and Table III.3 of today's notice.
More discussion on this topic can be found in Section IV.D.2.e of
today's NOPR.
6. Markups To Determine Price
7. Equipment Life
8. Installation Costs
9. Open- Versus Closed-Loop Installations
10. Ice Maker Shipments by Type of Equipment
11. Intermittency of Manufacturer R&D and Impact of Standards
12. INPV Results and Impact of Standards
13. Small Businesses
14. Consumer Utility and Performance
15. Analysis Period
16. Social Cost of Carbon
17. Remote to Rack Equipment
18. Design Options Associated With Each TSL
19. Standard Levels for Batch-Type Ice Makers Over 2,500 lbs
Ice/24 Hours
VIII. Approval of the Office of the Secretary
I. Summary of the Proposed Rule
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), established the Energy Conservation Program for Certain
Industrial Equipment, a program covering certain industrial
equipment,\2\ which includes the focus of this proposed rule: automatic
commercial ice makers.
---------------------------------------------------------------------------
\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 (AEMTCA), Public Law 112-210 (Dec. 18, 2012).
---------------------------------------------------------------------------
Pursuant to EPCA, any new or amended energy conservation standard
that DOE prescribes for the covered
[[Page 14848]]
equipment, such as automatic commercial ice makers, shall be designed
to achieve the maximum improvement in energy efficiency that is
technologically feasible and economically justified and would result in
significant conservation of energy. (42 U.S.C. 6295(o)(2)(A) and
(3)(B); 6313(d)(4))
In accordance with these and other statutory criteria discussed in
this proposed rule, DOE proposes amended conservation standards for
automatic commercial ice makers,\3\ and new standards for covered
equipment not yet subject to energy conservation standards. The
proposed standards, which consist of maximum allowable energy usage
values per 100 lb of ice production, are shown in Table I.1 and Table
I.2. Standards shown on Table I.1 for batch type ice makers represent
an amendment to existing standards set for cube type ice makers by EPCA
in 42 U.S.C. 6313(d)(1). Table I.1 also shows new standards for cube
type ice makers with expanded harvest capacities up to 4,000 pounds of
ice per 24 hour period (lb ice/24 hours) and an explicit coverage of
other types of batch machines, such as tube type ice makers. Table I.2
provides proposed standards for continuous type ice-making machines,
which are not covered by DOE's existing standards. The proposed
standards include, for applicable equipment classes, maximum condenser
water usage values in gallons per 100 lb of ice production. If adopted,
the proposed standards would apply to all equipment manufactured in, or
imported into, the United States, beginning 3 years after the
publication date of the final rule. (42 U.S.C. 6313(d)(2)(B)(i) and
(3)(C)(i))
---------------------------------------------------------------------------
\3\ EPCA as amended by the Energy Policy Act of 2005 (EPACT
2005) established maximum energy use and maximum condenser water use
standards for cube type automatic commercial ice makers with harvest
capacities between 50 and 2,500 lb/24 hours. In this rulemaking, DOE
proposes amending the legislated energy use standards for these
automatic commercial ice maker types. DOE did not, however, consider
amendment to the existing condenser water use standards for
equipment with existing condenser water standards. In the
preliminary TSD, DOE indicated that the ice maker standards
primarily focus on energy use, and that DOE is not bound by EPCA to
evaluate reductions in the condenser water use in automatic
commercial ice makers, and may in fact consider increases in
condenser water use, if this is a cost-effective way to improve
energy efficiency. Section 0 of today's NOPR contains more
information on DOE's analysis of condenser water use.
Table I.1--Proposed Energy Conservation Standards for Batch Type Automatic Commercial Ice Makers
--------------------------------------------------------------------------------------------------------------------------------------------------------
Rated harvest rate lb ice/24 Maximum energy use kilowatt- Maximum condenser water use
Equipment type Type of cooling hours hours (kWh)/100 lb ice * gal/100 lb ice **
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ice-Making Head................. Water................... <500 5.84-0.0041H 200-0.022H
>=500 and <1,436 3.88-0.0002H 200-0.022H
>=1,436 and <2,500 3.6 200-0.022H
>=2,500 and <4,000 3.6 145
Ice-Making Head................. Air..................... <450 7.70-0.0065H NA
>=450 and <875 5.17-0.0008H NA
>=875 and <2,210 4.5
>=2,210 and <2,500 6.89-0.0011H NA
>= 2,500 and <4,000 4.1
Remote Condensing (but not Air..................... <1,000 7.52-0.0032H NA
remote compressor).
Air..................... >=1,000 and <4,000 4.3 NA
Remote Condensing and Remote Air..................... <934 7.52-0.0032H NA
Compressor.
Air..................... >=934 and <4,000 4.5 NA
Self-Contained.................. Water................... <200 8.55-0.0143H 191-0.0315H
>=200 and <2,500 5.7 191-0.0315H
>=2,500 and <4,000 5.7 112
Self-Contained.................. Air..................... <175 12.6-0.0328H NA
>=175 and <4,000 6.9 NA
--------------------------------------------------------------------------------------------------------------------------------------------------------
* H = rated harvest rate in pounds per 24 hours, indicating the water or energy use for a given rated harvest rate. Source: 42 U.S.C. 6313(d).
** Water use is for the condenser only and does not include potable water used to make ice.
Table I.2--Proposed Energy Conservation Standards for Continuous Type Automatic Commercial Ice Makers
--------------------------------------------------------------------------------------------------------------------------------------------------------
Rated harvest rate lb ice/24 Maximum energy use kWh/100 Maximum condenser water use
Equipment type Type of cooling hours lb ice * gal/100 lb ice **
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ice-Making Head................. Water................... <900 6.08-0.0025H 160-0.0176H
>=900 and <2,500 3.8 160-0.0176H
>=2,500 and <4,000 3.8 116
Ice-Making Head................. Air..................... <700 9.24-0.0061H NA
>=700 and <4,000 5.0 NA
Remote Condensing (but not Air..................... <850 7.5-0.0034H NA
remote compressor).
>=850 and <4,000 4.6 NA
Remote Condensing and Remote Air..................... <850 7.65-0.0034H NA
Compressor.
>=850 and <4,000 4.8 NA
Self-Contained.................. Water................... <900 7.28-0.0027H 153-0.0252H
>=900 and <2,500 4.9 153-0.0252H
>=2,500 and <4,000 4.9 90
Self-Contained.................. Air..................... <700 9.2-0.0050H NA
[[Page 14849]]
>=700 and <4,000 5.7 NA
--------------------------------------------------------------------------------------------------------------------------------------------------------
* H = rated harvest rate in pounds per 24 hours, indicating the water or energy use for a given rated harvest rate. Source: 42 U.S.C. 6313(d).
** Water use is for the condenser only and does not include potable water used to make ice.
A. Benefits and Costs to Customers
Table I.3 presents DOE's evaluation of the economic impacts of the
proposed standards on customers of automatic commercial ice makers, as
measured by the average life-cycle cost (LCC) savings \4\ and the
median payback period (PBP).\5\ The average LCC savings are positive
for all equipment classes under the standards proposed by DOE.
---------------------------------------------------------------------------
\4\ Life-cycle cost of automatic commercial ice makers is the
cost to customers of owning and operating the equipment over the
entire life of the equipment. Life-cycle cost savings are the
reductions in the life-cycle costs due to the amended energy
conservation standards when compared to the life-cycle costs of the
equipment in the absence of the amended energy conservation
standards.
\5\ Payback period refers to the amount of time (in years) it
takes customers to recover the increased installed cost of equipment
associated with new or amended standards through savings in
operating costs.
Table I.3--Impacts of Proposed Standards on Customers of Automatic
Commercial Ice Makers
------------------------------------------------------------------------
Average LCC Median PBP
Equipment class * savings 2012$ years
------------------------------------------------------------------------
IMH-W-Small-B....................... 328 2.27
IMH-W-Med-B......................... 587 0.85
IMH-W-Large-B **.................... 833 0.69
IMH-W-Large-B-1..................... 701 0.72
IMH-W-Large-B-2..................... 1,260 0.58
IMH-A-Small-B....................... 396 1.42
IMH-A-Large-B **.................... 1,127 0.84
IMH-A-Large-B-1..................... 1,168 0.82
IMH-A-Large-B-2..................... 908 0.94
RCU-Large-B **...................... 983 0.65
RCU-Large-B-1....................... 963 0.62
RCU-Large-B-2....................... 1,277 1.00
SCU-W-Large-B....................... 694 1.00
SCU-A-Small-B....................... 396 1.56
SCU-A-Large-B....................... 502 1.49
IMH-A-Small-C....................... 391 0.97
IMH-A-Large-C....................... 1,026 0.69
SCU-A-Small-C....................... 146 1.85
------------------------------------------------------------------------
* Abbreviations are: IMH is ice-making head; RCU is remote condensing
unit; SCU is self-contained unit; W is water-cooled; A is air-cooled;
Small refers to the lowest harvest category; Med refers to the Medium
category (water-cooled IMH only); RCU with and without remote
compressor were modeled as one group. For three large batch
categories, a machine at the low end of the harvest range (B-1) and a
machine at the higher end (B-2) were modeled. Values are shown only
for equipment classes that have significant volume of shipments and,
therefore, were directly analyzed. See chapter 5 of the NOPR technical
support document, ``Engineering Analysis,'' for a detailed discussion
of equipment classes analyzed.
** LCC savings and PBP results for these classes are weighted averages
of the typical units modeled for the large classes, using weights
provided in TSD chapter 7.
B. Impact on Manufacturers
The industry net present value (INPV) is the sum of the discounted
cash flows to the industry from the present year (2013) through the end
of the analysis period (2047). Using a real discount rate of 9.2
percent, DOE estimates that the INPV for manufacturers of automatic
commercial ice makers is $101.8 million in 2012$. Under the proposed
standards, DOE expects that manufacturers may lose up to 23.5 percent
of their INPV, or approximately $23.9 million. Based on DOE's
interviews with the manufacturers of automatic commercial ice makers,
DOE does not expect any plant closings or significant loss of
employment.
C. National Benefits
DOE's analyses indicate that the proposed standards for automatic
commercial ice makers would save a significant amount of energy. The
lifetime savings for equipment purchased in the 30-year period that
begins in the year of compliance with amended and new standards (2018-
2047) \6\ amount to 0.286 quadrillion British thermal units (quads) of
cumulative energy.
---------------------------------------------------------------------------
\6\ The standards analysis period for national benefits covers
the 30-year period, plus the life of equipment purchased during the
period. In the past DOE presented energy savings results for only
the 30-year period that begins in the year of compliance. In the
calculation of economic impacts, however, DOE considered operating
cost savings measured over the entire lifetime of products purchased
in the 30-year period. DOE has chosen to modify its presentation of
national energy savings to be consistent with the approach used for
its national economic analysis.
---------------------------------------------------------------------------
The cumulative national net present value (NPV) of total customer
savings of the proposed standards for automatic commercial ice makers
in 2012$ ranges from $0.791 billion (at a 7-percent
[[Page 14850]]
discount rate) to $1.751 billion (at a 3-percent discount rate \7\).
This NPV expresses the estimated total value of future operating cost
savings minus the estimated increased installed costs for equipment
purchased in the period from 2018-2047, discounted to 2013.
---------------------------------------------------------------------------
\7\ These discount rates are used in accordance with the Office
of Management and Budget (OMB) guidance to Federal agencies on the
development of regulatory analysis (OMB Circular A-4, September 17,
2003), and section E, ``Identifying and Measuring Benefits and
Costs,'' therein. Further details are provided in section 0.
---------------------------------------------------------------------------
In addition, the proposed standards are expected to have
significant environmental benefits. The energy savings would result in
cumulative emission reductions of 14.6 million metric tons (MMt) \8\ of
carbon dioxide (CO2), 8.7 thousand tons of nitrogen oxides
(NOX), 0.3 thousand tons of nitrous oxide (N2O),
75.8 thousand tons of methane (CH4) and 0.02 tons of mercury
(Hg),\9\ and 21 thousand tons of sulfur dioxide (SO2) based
on energy savings from equipment purchased over the period from 2018-
2047.\10\
---------------------------------------------------------------------------
\8\ A metric ton is equivalent to 1.1 U.S. short tons. Results
for NOX, Hg, and SO2 are presented in short
tons.
\9\ DOE calculates emissions reductions relative to the Annual
Energy Outlook 2013 (AEO2013) Reference Case, which generally
represents current legislation and environmental regulations for
which implementing regulations were available as of December 31,
2012.
\10\ DOE also estimated CO2 and CO2
equivalent (CO2eq) emissions that occur through 2030
(CO2eq includes greenhouse gases such as CH4
and N2O). The estimated emissions reductions through 2030
are 5.8 million metric tons CO2, 576 thousand tons
CO2eq for CH4, and 25 thousand tons
CO2eq for N2O.
---------------------------------------------------------------------------
The value of the CO2 reductions is calculated using a
range of values per metric ton of CO2 (otherwise known as
the Social Cost of Carbon, or SCC) developed and recently updated by an
interagency process.\11\ The derivation of the SCC value is discussed
in section IV.L. DOE estimates the net present monetary value of the
CO2 emissions reduction is between $0.102 and $1.426
billion, expressed in 2012$ and discounted to 2013. DOE also estimates
the net present monetary value of the NOX emissions
reduction, expressed in 2012$ and discounted to 2013, is between $0.54
and $5.53 million at a 7-percent discount rate, and between $1.71 and
$17.56 million at a 3-percent discount rate.\12\
---------------------------------------------------------------------------
\11\ https://www.whitehouse.gov/sites/default/files/omb/assets/inforeg/technical-update-social-cost-of-carbon-for-regulator-impact-analysis.pdf.
\12\ DOE is currently investigating valuation of avoided Hg and
SO2 emissions.
---------------------------------------------------------------------------
Table I.4 summarizes the national economic costs and benefits
expected to result from today's proposed standards for automatic
commercial ice makers.
Table I.4--Summary of National Economic Benefits and Costs of Proposed Automatic Commercial Ice Maker
Conservation Standards
----------------------------------------------------------------------------------------------------------------
Present value Discount rate
Category million 2012$ (percent)
----------------------------------------------------------------------------------------------------------------
Benefits
----------------------------------------------------------------------------------------------------------------
Operating Cost Savings...................................................... 982 7
2,114 3
CO[ihel2] Reduction Monetized Value ($11.8/t case) *........................ 102 5
CO[ihel2] Reduction Monetized Value ($39.7/t case) *........................ 463 3
CO[ihel2] Reduction Monetized Value ($61.2/t case) *........................ 733 2.5
CO[ihel2] Reduction Monetized Value ($117/t case) *......................... 1,426 3
NOX Reduction Monetized Value ($2,639/t case) **............................ 3 7
10 3
Total Benefits [dagger], [dagger][dagger]................................... 1,448 7
2,587 3
----------------------------------------------------------------------------------------------------------------
Costs
----------------------------------------------------------------------------------------------------------------
Incremental Installed Costs................................................. 191 7
364 3
----------------------------------------------------------------------------------------------------------------
Net Benefits
----------------------------------------------------------------------------------------------------------------
Including CO[ihel2] and NOX Reduction Monetized Value....................... 1,257 7
2,223 3
----------------------------------------------------------------------------------------------------------------
* The CO[ihel2] values represent global monetized values of the SCC, in 2012$, in year 2015 under several
scenarios of the updated SCC values. The values of $11.8, $39.7, and $61.2 per metric ton (t) are the averages
of SCC distributions calculated using 5-percent, 3-percent, and 2.5-percent discount rates, respectively. The
value of $117.0/t represents the 95th percentile of the SCC distribution calculated using a 3-percent discount
rate. The SCC time series used by DOE incorporate an escalation factor.
** The value represents the average of the low and high NOX values used in DOE's analysis.
[dagger] Total Benefits for both the 3-percent and the 7-percent cases are derived using the series
corresponding to SCC value of $39.7/t.
[dagger][dagger] DOE estimates reductions in sulfur dioxide, mercury, methane and nitrous oxide emissions, but
is not currently monetizing these reductions. Thus, these impacts are excluded from the total benefits.
The benefits and costs of today's proposed standards, for automatic
commercial ice makers sold in 2018-2047, can also be expressed in terms
of annualized values. The annualized monetary values are the sum of (1)
the annualized national economic value of the benefits from the
operation of equipment that meets the proposed standards (consisting
primarily of operating cost savings from using less energy and water,
minus increases in equipment installed cost, which is another way of
representing customer NPV); and (2) the annualized monetary value of
the benefits of emission reductions, including CO2 emission
reductions.\13\
---------------------------------------------------------------------------
\13\ DOE used a two-step calculation process to convert the
time-series of costs and benefits into annualized values. First, DOE
calculated a present value in 2013, the year used for discounting
the NPV of total consumer costs and savings, for the time-series of
costs and benefits using discount rates of 3 and 7 percent for all
costs and benefits except for the value of CO2
reductions. For the latter, DOE used a range of discount rates, as
shown in Table I.5. From the present value, DOE then calculated the
fixed annual payment over a 30-year period (2018 through 2047) that
yields the same present value. The fixed annual payment is the
annualized value. Although DOE calculated annualized values, this
does not imply that the time-series of cost and benefits from which
the annualized values were determined is a steady stream of
payments.
---------------------------------------------------------------------------
[[Page 14851]]
Although combining the values of operating savings and
CO2 emission reductions provides a useful perspective, two
issues should be considered. First, the national operating savings are
domestic U.S. customer monetary savings that occur as a result of
market transactions, while the value of CO2 reductions is
based on a global value. Second, the assessments of operating cost
savings and CO2 savings are performed with different methods
that use different time frames for analysis. The national operating
cost savings is measured over the lifetimes of automatic commercial ice
makers shipped from 2018 to 2047. The SCC values, on the other hand,
reflect the present value of some future climate-related impacts
resulting from the emission of 1 ton of CO2 in each year.
These impacts continue well beyond 2100.
Estimates of annualized benefits and costs of the proposed
standards are shown in Table I.5. (All monetary values below are
expressed in 2012$.) Table I.5 shows the primary, low net benefits, and
high net benefits scenarios. The primary estimate is the estimate in
which the operating cost savings were calculated using the Annual
Energy Outlook 2013 (AEO2013) Reference Case forecast of future
electricity prices. The low net benefits estimate and the high net
benefits estimate are based on the low and high electricity price
scenarios from the AEO2013 forecast, respectively.\14\ Using a 7-
percent discount rate for benefits and costs, the cost in the primary
estimate of the standards proposed in this rule is $20 million per year
in increased equipment costs. (Note that DOE used a 3-percent discount
rate along with the corresponding SCC series value of $39.7/ton in
2012$ to calculate the monetized value of CO2 emissions
reductions.) The annualized benefits are $104 million per year in
reduced equipment operating costs, $27 million in CO2
reductions, and $0.32 million in reduced NOX emissions. In
this case, the annualized net benefit amounts to $110 million. At a 3-
percent discount rate for all benefits and costs, the cost in the
primary estimate of the amended standards proposed in this notice is
$21 million per year in increased equipment costs. The benefits are
$121 million per year in reduced operating costs, $27 million in
CO2 reductions, and $0.55 million in reduced NOX
emissions. In this case, the net benefit amounts to $128 million per
year.
---------------------------------------------------------------------------
\14\ The AEO2013 scenarios used are the ``High Economics'' and
``Low Economics'' scenarios.
---------------------------------------------------------------------------
DOE also calculated the low net benefits and high net benefits
estimates by calculating the operating cost savings and shipments at
the AEO2013 low economic growth case and high economic growth case
scenarios, respectively. The low and high benefits for incremental
installed costs were derived using the low and high price learning
scenarios. The net benefits and costs for low and high net benefits
estimates were calculated in the same manner as the primary estimate by
using the corresponding values of operating cost savings and
incremental installed costs.
Table I.5--Annualized Benefits and Costs of Proposed Standards for Automatic Commercial Ice Makers
----------------------------------------------------------------------------------------------------------------
Low net High net
Discount rate Primary benefits benefits
(percent) estimate * estimate * estimate *
million 2012$ million 2012$ million 2012$
----------------------------------------------------------------------------------------------------------------
Benefits
----------------------------------------------------------------------------------------------------------------
Operating Cost Savings.................. 7 104 98 112
3 121 113 132
CO[ihel2] Reduction Monetized Value 5 8 8 8
($11.8/t case) **......................
CO[ihel2] Reduction Monetized Value 3 27 26 27
($39.7/t case) **......................
CO[ihel2] Reduction Monetized Value 2.5 39 38 40
($61.2/t case) **......................
CO[ihel2] Reduction Monetized Value 3 82 80 84
($117/t case) **.......................
NOX Reduction Monetized Value (at $2,639/ 7 0.32 0.31 0.33
t case) **.............................
3 0.55 0.53 0.58
Total Benefits (Operating Cost Savings, 7 131 124 139
CO[ihel2] Reduction and NOX Reduction)
[dagger]...............................
3 149 139 160
----------------------------------------------------------------------------------------------------------------
Costs
----------------------------------------------------------------------------------------------------------------
Total Incremental Installed Costs....... 7 20 21 20
3 21 22 20
----------------------------------------------------------------------------------------------------------------
Net Benefits Less Costs
----------------------------------------------------------------------------------------------------------------
Total Benefits Less Incremental Costs... 7 110 103 120
3 128 118 140
----------------------------------------------------------------------------------------------------------------
* The primary, low, and high estimates utilize forecasts of energy prices from the AEO2013 Reference Case, Low
Economic Growth Case, and High Economic Growth Case, respectively.
** The CO[ihel2] values represent global monetized values of the SCC, in 2012$, in 2015 under several scenarios
of the updated SCC values. The values of $11.8, $39.7, and $61.2 per ton are the averages of SCC distributions
calculated using 5-percent, 3-percent, and 2.5-percent discount rates, respectively. The value of $117.0 per
ton represents the 95th percentile of the SCC distribution calculated using a 3-percent discount rate. See
section IV.L for details. For NOX, an average value ($2,639) of the low ($468) and high ($4,809) values was
used.
[dagger] Total monetary benefits for both the 3-percent and 7-percent cases utilize the central estimate of
social cost of NOX and CO[ihel2] emissions calculated at a 3-percent discount rate (averaged across three
integrated assessment models) , which is equal to $39.7/ton (in 2012$).
[[Page 14852]]
DOE has tentatively concluded that the proposed standards represent
the maximum improvement in energy efficiency that is technologically
feasible and economically justified, and would result in significant
conservation of energy (42 U.S.C. 6295(o)(2)(B) and 6313(d)(4)) DOE
further notes that technologies used to achieve these standard levels
are already commercially available for the equipment classes covered by
this notice. Based on the analyses described above, DOE has tentatively
concluded that the benefits of the proposed standards to the Nation
(energy savings, positive NPV of customer benefits, customer LCC
savings, and emission reductions) would outweigh the burdens (loss of
INPV for manufacturers and LCC increases for some customers).
DOE also considered more-stringent energy use levels as trial
standard levels (TSLs), and is still considering them in this
rulemaking. However, DOE has tentatively concluded that the potential
burdens of the more-stringent energy use levels would outweigh the
projected benefits. Based on consideration of the public comments DOE
receives in response to this proposed rule and related information
collected and analyzed during the course of this rulemaking effort, DOE
may adopt energy use levels presented in this notice that are either
higher or lower than the proposed standards, or some combination of
level(s) that incorporate the proposed standards in part.
II. Introduction
The following section briefly discusses the statutory authority
underlying this proposal, as well as some of the relevant historical
background related to the establishment of standards for automatic
commercial ice makers.
A. Authority
Title III, Part C of EPCA,\15\ Public Law 94-163 (42 U.S.C. 6311-
6317, as codified), established the Energy Conservation Program for
Certain Industrial Equipment, a program covering certain industrial
equipment, which includes the subject of this rulemaking: Automatic
commercial ice makers.\16\
---------------------------------------------------------------------------
\15\ For editorial reasons, upon codification in the U.S. Code,
Part C was re-designated Part A-1.
\16\ All references to EPCA in this document refer to the
statute as amended through the American Energy Manufacturing
Technical Corrections Act (AEMTCA), Public Law 112-210 (Dec. 18,
2012).
---------------------------------------------------------------------------
EPCA prescribed energy conservation standards for automatic
commercial ice makers that produce cube type ice with capacities
between 50 and 2,500 lb ice/24 hours. (42 U.S.C. 6313(d)(1)) EPCA
requires DOE to review these standards and determine, by January 1,
2015, whether amending the applicable standards is technically feasible
and economically justified. (42 U.S.C. 6313(d)(3)(A)) If amended
standards are technically feasible and economically justified, DOE must
issue a final rule by the same date. (42 U.S.C. 6313(d)(3)(B))
Additionally, EPCA granted DOE the authority to conduct rulemakings to
establish new standards for automatic commercial ice makers not covered
by 42 U.S.C. 6313(d)(1)), and DOE is using that authority in this
rulemaking. (42 U.S.C. 6313(d)(2)(A))
Pursuant to EPCA, DOE's energy conservation program for covered
equipment generally consists of four parts: (1) Testing; (2) labeling;
(3) the establishment of Federal energy conservation standards; and (4)
certification and enforcement procedures. Subject to certain criteria
and conditions, DOE is required to develop test procedures to measure
the energy efficiency, energy use, or estimated annual operating cost
of each type or class of covered equipment. (42 U.S.C. 6314)
Manufacturers of covered equipment must use the prescribed DOE test
procedure as the basis for certifying to DOE that their equipment
complies with the applicable energy conservation standards adopted
under EPCA. Similarly, DOE must use these test procedures to determine
whether that equipment complies with standards adopted pursuant to
EPCA. (42 U.S.C. 6295(s)) Manufacturers, when making representations to
the public regarding the energy use or efficiency of that equipment,
must use the prescribed DOE test procedure as the basis for such
representations. (42 U.S.C. 6314(d)) The DOE test procedures for
automatic commercial ice makers currently appear at title 10 of the
Code of Federal Regulations (CFR) part 431, subpart H.
DOE must follow specific statutory criteria for prescribing amended
standards for covered equipment. As indicated above, any amended
standard for covered equipment must be designed to achieve the maximum
improvement in energy efficiency that is technologically feasible and
economically justified. (42 U.S.C. 6295(o)(2)(A) and 6313(d)(4))
Furthermore, DOE may not adopt any standard that would not result in
the significant conservation of energy. (42 U.S.C. 6295(o)(3) and
6313(d)(4)) DOE also may not prescribe a standard: (1) For certain
industrial equipment, including automatic commercial ice makers, if no
test procedure has been established for the product; or (2) if DOE
determines by rule that the proposed standard is not technologically
feasible or economically justified. (42 U.S.C. 6295(o)(3)(A)-(B) and
6313(d)(4)) In deciding whether a proposed standard is economically
justified, DOE must determine whether the benefits of the standard
exceed its burdens. (42 U.S.C. 6295(o)(2)(B)(i) and 6313(d)(4)) DOE
must make this determination after receiving comments on the proposed
standard, and by considering, to the greatest extent practicable, the
following seven factors:
1. The economic impact of the standard on manufacturers and
consumers of the equipment subject to the standard;
2. The savings in operating costs throughout the estimated average
life of the covered equipment in the type (or class) compared to any
increase in the price, initial charges, or maintenance expenses for the
covered equipment that are likely to result from the imposition of the
standard;
3. The total projected amount of energy, or as applicable, water,
savings likely to result directly from the imposition of the standard;
4. Any lessening of the utility or the performance of the covered
equipment likely to result from the imposition of the standard;
5. The impact of any lessening of competition, as determined in
writing by the U.S. Attorney General (Attorney General), that is likely
to result from the imposition of the standard;
6. The need for national energy and water conservation; and
7. Other factors the Secretary of Energy (Secretary) considers
relevant. (42 U.S.C. 6295(o)(2)(B)(i)(I)-(VII) and 6313(d)(4))
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 covered
equipment. (42 U.S.C. 6295(o)(1) and 6313(d)(4)) 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) and 6313(d)(4))
Further, EPCA, as codified, establishes a rebuttable presumption
that a standard is economically justified
[[Page 14853]]
if the Secretary finds that the additional cost to the consumer of
purchasing a product complying with an energy conservation standard
level will be less than three times the value of the energy savings
during the first year that the consumer will receive as a result of the
standard, as calculated under the applicable test procedure. (See 42
U.S.C. 6295(o)(2)(B)(iii) and 6313(d)(4)) Section III.E.2 presents
additional discussion about rebuttable presumption payback period
(RPBP).
Additionally, 42 U.S.C. 6295(q)(1) specifies requirements when
promulgating a standard for a type or class of covered equipment. DOE
must specify a different standard level than that which applies
generally to such type or class of equipment for any group of covered
products that has 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 equipment within such type (or
class); or (B) have a capacity or other performance-related feature
that other equipment within such type (or class) do not have and such
feature 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 equipment, DOE must consider such factors as
the utility to the consumer of the feature and other factors DOE deems
appropriate. Id. Any rule prescribing such a standard must include an
explanation of the basis on which such higher or lower level was
established. (42 U.S.C. 6295(q)(2))
Federal energy conservation requirements generally supersede State
laws or regulations concerning energy conservation testing, labeling,
and standards. (42 U.S.C. 6297(a)-(c) and 6316(f)) DOE may, however,
grant waivers of Federal preemption for particular State laws or
regulations, in accordance with the procedures and other provisions set
forth under 42 U.S.C. 6297(d) and 6316(f).
DOE has also reviewed this regulation pursuant to Executive Order
13563, issued on January 18, 2011. 76 FR 3821 (Jan. 21, 2011).
Executive Order 13563 is supplemental to and explicitly reaffirms the
principles, structures, and definitions governing regulatory review
established in Executive Order 12866. 58 FR 51735 (Oct. 4, 1993). To
the extent permitted by law, agencies are required by Executive Order
13563 to: (1) Propose or adopt a regulation only upon a reasoned
determination that its benefits justify its costs (recognizing that
some benefits and costs are difficult to quantify); (2) tailor
regulations to impose the least burden on society, consistent with
obtaining regulatory objectives, taking into account, among other
things, and to the extent practicable, the costs of cumulative
regulations; (3) select, in choosing among alternative regulatory
approaches, those approaches that maximize net benefits (including
potential economic, environmental, public health and safety, and other
advantages; distributive impacts; and equity); (4) to the extent
feasible, specify performance objectives, rather than specifying the
behavior or manner of compliance that regulated entities must adopt;
and (5) identify and assess available alternatives to direct
regulation, including providing economic incentives to encourage the
desired behavior, such as user fees or marketable permits, or providing
information upon which choices can be made by the public. 76 FR 3821
(Jan. 21, 2011).
DOE emphasizes as well that Executive Order 13563 requires agencies
to use the best available techniques to quantify anticipated present
and future benefits and costs as accurately as possible. In its
guidance, the Office of Information and Regulatory Affairs (OIRA) has
emphasized that such techniques may include identifying changing future
compliance costs that might result from technological innovation or
anticipated behavioral changes. 76 FR 3821 (Jan. 21, 2011). For the
reasons stated in the preamble, DOE believes that this NOPR is
consistent with these principles, including the requirement that, to
the extent permitted by law, benefits justify costs and that net
benefits are maximized.
Consistent with Executive Order 13563, and the range of impacts
analyzed in this rulemaking, the standards proposed herein by DOE
achieves maximum net benefits.
B. Background
1. Current Standards
In a final rule published on October 18, 2005, DOE adopted the
energy conservation standards and water conservation standards
prescribed by EPCA in 42 U.S.C. 6313(d)(1) for certain automatic
commercial ice makers manufactured on or after January 1, 2010. 70 FR
at 60407, 60415-16. These standards consist of maximum energy use and
maximum condenser water use to produce 100 pounds of ice for automatic
commercial ice makers with harvest rates between 50 and 2,500 lb ice/24
hours. These standards appear at 10 CFR part 431, subpart H, Automatic
Commercial Ice Makers. Table II.1 presents DOE's current energy
conservation standards for automatic commercial ice makers.
Table II.1--Automatic Commercial Ice Makers Standards Prescribed by EPCA--Compliance Required Beginning on January 1, 2010
--------------------------------------------------------------------------------------------------------------------------------------------------------
Maximum energy use kWh/100 lb Maximum condenser water use *
Equipment type Type of cooling Harvest rate lb ice/24 hours ice gal/100 lb ice
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ice-Making Head................. Water................... <500 7.8-0.0055H ** 200-0.022H.**
>=500 and <1,436 5.58-0.0011H 200-0.022H.
>=1,436 4.0 200-0.022H.
Air..................... <450 10.26-0.0086H Not Applicable.
>=450 6.89-0.0011H Not Applicable.
Remote Condensing (but not Air..................... <1,000 8.85-0.0038H Not Applicable.
remote compressor).
>=1,000 5.10 Not Applicable.
Remote Condensing and Remote Air..................... <934 8.85-0.0038H Not Applicable.
Compressor.
>=934 5.30 Not Applicable.
Self-Contained.................. Water................... <200 11.4-0.019H 191-0.0315H.
>=200 7.60 191-0.0315H.
Air..................... <175 18.0-0.0469H Not Applicable.
>=175 9.80 Not Applicable.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Source: 42 U.S.C. 6313(d).
* Water use is for the condenser only and does not include potable water used to make ice.
[[Page 14854]]
** H = harvest rate in pounds per 24 hours, indicating the water or energy use for a given harvest rate.
2. History of Standards Rulemaking for Automatic Commercial Ice Makers
As stated above, EPCA prescribes energy conservation standards and
water conservation standards for certain cube type automatic commercial
ice makers with harvest rates between 50 and 2,500 lb ice/24 hours:
Self-contained ice makers and ice-making heads (IMHs) using air or
water for cooling and ice makers with remote condensing with or without
a remote compressor. Compliance with these standards was required as of
January 1, 2010. (42 U.S.C. 6313(d)(1)) DOE adopted these standards and
placed them under 10 CFR part 431, subpart H, Automatic Commercial Ice
Makers.
In addition, EPCA requires DOE to conduct a rulemaking to determine
whether to amend the standards established under 42 U.S.C. 6313(d)(1),
and if DOE determines that amendment is warranted, DOE must also issue
a final rule establishing such amended standards by January 1, 2015.
(42 U.S.C. 6313(d)(3)(A))
Furthermore, EPCA granted DOE authority to set standards for
additional types of automatic commercial ice makers that are not
covered in 42 U.S.C. 6313(d)(1). (42 U.S.C. 6313(d)(2)(A)) While not
enumerated in EPCA, additional types of automatic commercial ice makers
DOE identified as candidates for standards to be established in this
rulemaking include flake and nugget, as well as batch type ice makers
that are not included in the EPCA definition of cube type ice makers.
To satisfy its requirement to conduct a rulemaking, DOE initiated
the current rulemaking on November 4, 2010 by publishing on its Web
site its ``Rulemaking Framework for Automatic Commercial Ice Makers.''
(The Framework document is available at: www.regulations.gov/#!documentDetail;D=EERE-2010-BT-STD-0037-0024.)
DOE also published a notice in the Federal Register announcing the
availability of the Framework document, as well as a public meeting to
discuss the document. The notice also solicited comment on the matters
raised in the document. 75 FR 70852 (Nov. 19, 2010). The Framework
document described the procedural and analytical approaches that DOE
anticipated using to evaluate amended standards for automatic
commercial ice makers, and identified various issues to be resolved in
the rulemaking.
DOE held the Framework public meeting on December 16, 2010, at
which it: (1) Presented the contents of the Framework document; (2)
described the analyses it planned to conduct during the rulemaking; (3)
sought comments from interested parties on these subjects; and (4) in
general, sought to inform interested parties about, and facilitate
their involvement in, the rulemaking. Major issues discussed at the
public meeting included: (1) The scope of coverage for the rulemaking;
(2) equipment classes; (3) analytical approaches and methods used in
the rulemaking; (4) impacts of standards and burden on manufacturers;
(5) technology options; (6) distribution channels, shipments, and end
users; (7) impacts of outside regulations; and (8) environmental
issues. At the meeting and during the comment period on the Framework
document, DOE received many comments that helped it identify and
resolve issues pertaining to automatic commercial ice makers relevant
to this rulemaking. These comments are discussed in subsequent sections
of this notice.
DOE then gathered additional information and performed preliminary
analyses to help review standards for this equipment. This process
culminated in DOE publishing a notice of another public meeting (the
January 2012 notice) to discuss and receive comments regarding the
tools and methods DOE used in performing its preliminary analysis, as
well as the analyses results. 77 FR 3404 (Jan. 24, 2012). DOE also
invited written comments on these subjects and announced the
availability on its Web site of a preliminary analysis technical
support document (preliminary analysis TSD). Id. (The preliminary
analysis TSD is available at: www.regulations.gov/#!documentDetail;D=EERE-2010-BT-STD-0037-0026.) Finally, DOE sought
comments concerning other relevant issues that could affect amended
standards for automatic commercial ice makers, or that DOE should
address in this NOPR. Id.
The preliminary analysis TSD provided an overview of DOE's review
of the standards for automatic commercial ice makers, discussed the
comments DOE received in response to the Framework document, and
addressed issues including the scope of coverage of the rulemaking. The
document also described the analytical framework that DOE used (and
continues to use) in considering amended standards for automatic
commercial ice makers, including a description of the methodology, the
analytical tools, and the relationships between the various analyses
that are part of this rulemaking. Additionally, the preliminary
analysis TSD presented in detail each analysis that DOE had performed
for this equipment up to that point, including descriptions of inputs,
sources, methodologies, and results. These analyses were as follows:
A market and technology assessment addressed the scope of
this rulemaking, identified existing and potential new equipment
classes for automatic commercial ice makers, characterized the markets
for this equipment, and reviewed techniques and approaches for
improving its efficiency;
A screening analysis reviewed technology options to
improve the efficiency of automatic commercial ice makers, and weighed
these options against DOE's four prescribed screening criteria;
An engineering analysis estimated the manufacturer selling
prices (MSPs) associated with more energy-efficient automatic
commercial ice makers;
An energy and water use analysis developed the annual
energy and water usage values for economic analysis of automatic
commercial ice makers;
A markups analysis converted estimated MSPs derived from
the engineering analysis to customer purchase prices;
A life-cycle cost analysis calculated, for individual
customers, the discounted savings in operating costs throughout the
estimated average life of automatic commercial ice makers, compared to
any increase in installed costs likely to result directly from the
imposition of a given standard;
A payback period analysis estimated the amount of time it
would take customers to recover the higher purchase price of more
energy-efficient equipment through lower operating costs;
A shipments analysis estimated shipments of automatic
commercial ice makers over the time period examined in the analysis;
A national impact analysis (NIA) assessed the national
energy savings (NES), and the national NPV of total customer costs and
savings, expected to result from specific, potential energy
conservation standards for automatic commercial ice makers; and
A preliminary manufacturer impact analysis (MIA) took the
initial steps in evaluating the potential effects on
[[Page 14855]]
manufacturers of amended efficiency standards.
The public meeting announced in the January 2012 notice took place
on February 16, 2012 (February 2012 preliminary analysis public
meeting). At the February 2012 preliminary analysis public meeting, DOE
presented the methodologies and results of the analyses set forth in
the preliminary analysis TSD. Interested parties provided comments on
the following issues: (1) Equipment classes; (2) technology options;
(3) energy modeling and validation of engineering models; (4) cost
modeling; (5) market information, including distribution channels and
distribution markups; (6) efficiency levels; (7) life-cycle costs to
customers, including installation, repair and maintenance costs, and
water and wastewater prices; and (8) historical shipments. The comments
received since publication of the January 2012 notice, including those
received at the February 2012 preliminary analysis public meeting, have
contributed to DOE's proposed resolution of the issues in this
rulemaking as they pertain to automatic commercial ice makers. This
NOPR responds to the issues raised by the comments. (A parenthetical
reference at the end of a quotation or paraphrase provides the location
of the item in the public record.)
III. General Discussion
A. List of Equipment Class Abbreviations
In this notice, equipment class names are frequently abbreviated.
The abbreviations are shown on Table III.1.
Table III.1--List of Equipment Class Abbreviations
----------------------------------------------------------------------------------------------------------------
Rated harvest rate lb ice/
Abbreviation Equipment type Condenser type 24 hours Ice type
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B............... Ice-Making Head..... Water.......... <500 Batch.
IMH-W-Med-B................. Ice-Making Head..... Water.......... >=500 and <1,436 Batch.
IMH-W-Large-B *............. Ice-Making Head..... Water.......... >=1,436 and <4,000 Batch.
IMH-A-Small-B............... Ice-Making Head..... Air............ <450 Batch.
IMH-A-Large-B* ** (also IMH- Ice-Making Head..... Air............ >=450 and <875 Batch.
A-Large-B-1).
IMH-A-Extended-B* ** (also Ice-Making Head..... Air............ >=875 and <4,000 Batch.
IMH-A-Large-B-2).
RCU-NRC-Small-B............. Remote Condensing, Air............ <1,000 Batch.
not Remote
Compressor.
RCU-NRC-Large-B*............ Remote Condensing, Air............ >=1,000 and <4,000 Batch.
not Remote
Compressor.
RCU-RC-Small-B.............. Remote Condensing, Air............ <934 Batch.
and Remote
Compressor.
RCU-RC-Large-B.............. Remote Condensing, Air............ >=934 and <4,000 Batch.
and Remote
Compressor.
SCU-W-Small-B............... Self-Contained Unit. Water.......... <200 Batch.
SCU-W-Large-B............... Self-Contained Unit. Water.......... >=200 and <4,000 Batch.
SCU-A-Small-B............... Self-Contained Unit. Air............ <175 Batch.
SCU-A-Large-B............... Self-Contained Unit. Air............ >=175 and <4,000 Batch.
IMH-W-Small-C............... Ice-Making Head..... Water.......... <900 Continuous.
IMH-W-Large-C............... Ice-Making Head..... Water.......... >=900 and <4,000 Continuous.
IMH-A-Small-C............... Ice-Making Head..... Air............ <700 Continuous.
IMH-A-Large-C............... Ice-Making Head..... Air............ >=700 and <4,000 Continuous.
RCU-NRC-Small-C............. Remote Condensing, Air............ <850 Continuous.
not Remote
Compressor.
RCU-NRC-Large-C............. Remote Condensing, Air............ >=850 and <4,000 Continuous.
not Remote
Compressor.
RCU-RC-Small-C.............. Remote Condensing, Air............ <850 Continuous.
and Remote
Compressor.
RCU-RC-Large-C.............. Remote Condensing, Air............ >=850 and <4,000 Continuous.
and Remote
Compressor.
SCU-W-Small-C............... Self-Contained Unit. Water.......... <900 Continuous.
SCU-W-Large-C............... Self-Contained Unit. Water.......... >=900 and <4,000 Continuous.
SCU-A-Small-C............... Self-Contained Unit. Air............ <700 Continuous.
SCU-A-Large-C............... Self-Contained Unit. Air............ >=700 and <4,000 Continuous.
----------------------------------------------------------------------------------------------------------------
* IMH-W-Large-B, IMH-A-Large-B, and RCU-NRC-Large-B were modeled in some NOPR analyses as two different units,
one at the lower end of the rated harvest range and one near the high end of the rated harvest range in which
a significant number of units are available. In the LCC and NIA models, the low and high harvest rate models
were denoted simply as B-1 and B-2. Where appropriate, the analyses add or perform weighted averages of the
two typical sizes to present class level results.
** IMH-A-Large-B was established by EPACT-2005 as a class between 450 and 2,500 lb ice/24 hours. In this notice,
DOE is proposing to divide this into two classes, which could either be considered ``Large'' and ``Very
Large'' or ``Medium'' and ``Large.'' In the LCC and NIA modeling, this was denoted as B-1 and B-2. The rated
harvest rate break point shown above is based on TSL 3 results.
B. Test Procedures
On December 8, 2006, DOE published a final rule in which it adopted
Air-Conditioning and Refrigeration Institute (ARI) Standard 810-2003,
``Performance Rating of Automatic Commercial Ice Makers,'' with a
revised method for calculating energy use, as the DOE test procedure
for this equipment. The DOE rule included a clarification to the energy
use rate equation to specify that the energy use be calculated using
the entire mass of ice produced during the testing period, normalized
to 100 lb of ice produced. 71 FR 71340, 71350 (Dec. 8, 2006). ARI
Standard 810-2003 requires performance tests to be conducted according
to the American National Standards Institute (ANSI)/American Society of
Heating, Refrigerating, and Air-Conditioning Engineers (ASHRAE)
Standard 29-1988 (reaffirmed 2005), ``Method of Testing
[[Page 14856]]
Automatic Ice Makers.'' The DOE test procedure incorporated by
reference the ANSI/ASHRAE Standard 29-1988 (Reaffirmed 2005) as the
method of test.
On January 11, 2012, DOE published a test procedure final rule
(2012 test procedure final rule) in which it adopted several amendments
to the DOE test procedure. This included an amendment to incorporate by
reference Air-Conditioning, Heating, and Refrigeration Institute (AHRI)
Standard 810-2007, which amends ARI Standard 810-2003 to expand the
capacity range of covered equipment, provide definitions and specific
test procedures for batch and continuous type ice makers, and provide a
definition for ice hardness factor, as the DOE test procedure for this
equipment. 77 FR 1591 (Jan. 11, 2012). In March 2011, AHRI published
Addendum 1 to Standard 810-2007, which revised the definition of
``potable water use rate'' and added new definitions for ``purge or
dump water'' and ``harvest water.'' DOE's 2012 test procedure final
rule incorporated this addendum to the AHRI Standard. The 2012 test
procedure final rule also included an amendment to incorporate by
reference the updated ANSI/ASHRAE Standard 29-2009. Id.
In addition, the 2012 test procedure final rule included several
amendments designed to address issues that were not accounted for by
the previous DOE test procedure. 77 FR at 1593 (Jan. 11, 2012). First,
DOE expanded the scope of the test procedure to include equipment with
capacities from 50 to 4,000 lb ice/24 hours.\17\ DOE also adopted
amendments to provide test methods for continuous type ice makers and
to standardize the measurement of energy and water use for continuous
type ice makers with respect to ice hardness. In the 2012 test
procedure final rule, DOE also clarified the test method and reporting
requirements for remote condensing automatic commercial ice makers
designed for connection to remote compressor racks. Finally, the 2012
test procedure final rule discontinued the use of the clarified energy
use rate calculation and instead required energy-use to be calculated
per 100 lb of ice as specified in ANSI/ASHRAE Standard 29-2009. The
2012 test procedure final rule became effective on February 10, 2012,
and the changes set forth in the final rule became mandatory for
equipment testing starting January 7, 2013. 77 FR at 1593 (Jan. 11,
2012).
---------------------------------------------------------------------------
\17\ EPCA defines automatic commercial ice maker in 42 U.S.C.
6311(19) as ``a factory-made assembly (not necessarily shipped in 1
package) that--(1) Consists of a condensing unit and ice-making
section operating as an integrated unit, with means for making and
harvesting ice; and (2) May include means for storing ice,
dispensing ice, or storing and dispensing ice.'' This definition
includes commercial ice-making equipment up to 4,000 lb ice/24
hours, though DOE had not previously established test procedures and
standards for units with the capacity between 2,500 and 4,000 lb
ice/24 hours. While 42 U.S.C. 6313(d)(1) explicitly sets standards
for cube type ice makers up to 2,500 lb ice/24 hours, 6313(d)(2)
provides authority to set standards for other equipment types--all
of which are covered by the EPCA definition of an automatic
commercial ice maker.
---------------------------------------------------------------------------
The test procedure amendments established in the 2012 test
procedure final rule are required to be used in conjunction with any
new standards promulgated as a result of this standards rulemaking. Use
of the amended test procedure to demonstrate compliance with DOE energy
conservation standards or for representations with respect to energy
consumption of automatic commercial ice makers is required on the
compliance date of any energy conservation standards established as
part of this rulemaking, and on January 7, 2013 for the energy
conservation standards set in the Energy Policy Act of 2005 (EPACT
2005). 77 FR at 1593 (Jan. 11, 2012).
C. Technological Feasibility
1. General
In each standards rulemaking, DOE conducts a screening analysis,
which it bases on information that it has gathered on all current
technology options and prototype designs that could improve the
efficiency of the products or equipment that are the subject of the
rulemaking. As the first step in such analysis, DOE develops a list of
design options for consideration, in consultation with manufacturers,
design engineers, and other interested parties. DOE then determines
which of these options for improving efficiency are technologically
feasible. DOE considers a design option to be technologically feasible
if it is used by the relevant industry or if a working prototype has
been developed. Technologies incorporated in commercially available
equipment or in working prototypes will be considered technologically
feasible. 10 CFR part 430, subpart C, appendix A, section 4(a)(4)(i)
Although DOE considers technologies that are proprietary, it will not
consider efficiency levels that can only be reached through the use of
proprietary technologies (i.e., a unique pathway), which could allow a
single manufacturer to monopolize or control the market.
Once DOE has determined that particular design options are
technologically feasible, it further evaluates each of these design
options in light of the following additional screening criteria: (1)
Practicability to manufacture, install, or service; (2) adverse impacts
on product utility or availability; and (3) adverse impacts on health
or safety. 10 CFR part 430, subpart C, appendix A, section 4(a)(4)(ii)-
(iv) Chapter 4 of the NOPR TSD discusses the results of the screening
analyses for automatic commercial ice makers. Specifically, it presents
the designs DOE considered, those it screened out, and those that are
the bases for the TSLs in this rulemaking.
2. Maximum Technologically Feasible Levels
When DOE proposes to adopt (or not adopt) an amended or new energy
conservation standard for a type or class of covered equipment such as
automatic commercial ice makers, it determines the maximum improvement
in energy efficiency that is technologically feasible for such
equipment. (See 42 U.S.C. 6295(p)(1) and 6313(d)(4)) Accordingly, in
the preliminary analysis, DOE determined the maximum technologically
feasible (``max-tech'') improvements in energy efficiency for automatic
commercial ice makers in the engineering analysis using the design
parameters that passed the screening analysis. See chapter 5 of the
NOPR TSD for the results of the analyses, and a list of technologies
included in max-tech equipment.
As indicated previously, whether efficiency levels exist or can be
achieved in commonly used equipment is not relevant to whether they are
max-tech levels. DOE considers technologies to be technologically
feasible if they are incorporated in any currently available equipment
or working prototypes. Hence, a max-tech level results from the
combination of design options predicted to result in the highest
efficiency level possible for an equipment class, with such design
options consisting of technologies already incorporated in commercial
equipment or working prototypes. DOE notes that it reevaluated the
efficiency levels, including the max-tech levels, when it updated its
results for this NOPR. Table III.2 and Table III.3 show the max-tech
levels determined in the engineering analysis for batch and continuous
type automatic commercial ice makers, respectively.
[[Page 14857]]
Table III.2--Max-Tech Levels for Batch Automatic Commercial Ice Makers
------------------------------------------------------------------------
Energy use lower
Equipment type * than baseline
------------------------------------------------------------------------
IMH-W-Small-B..................................... 30%.
IMH-W-Med-B....................................... 22%.
IMH-W-Large-B..................................... 17% (at 1,500 lb ice/
24 hours) 16% (at
2,600 lb ice/24
hours).
IMH-A-Small-B..................................... 33%.
IMH-A-Large-B..................................... 33% (at 800 lb ice/
24 hours) 21% (at
1,500 lb ice/24
hours).
RCU-Small-B....................................... Not analyzed--
similar to IMH-A.-
Large-B (1500).
RCU-Large-B....................................... 21% (at 1,500 lb ice/
24 hours) 21% (at
2,400 lb ice/24
hours).
SCU-W-Small-B..................................... Not analyzed--
similar to SCU-A-
Large-B.
SCU-W-Large-B..................................... 35%.
SCU-A-Small-B..................................... 41%.
SCU-A-Large-B..................................... 36%.
------------------------------------------------------------------------
* IMH is ice-making head; RCU is remote condensing unit; SCU is self-
contained unit; W is water-cooled; A is air-cooled; Small refers to
the lowest harvest category; Med refers to the Medium category (water-
cooled IMH only); Large refers to the large size category; RCU units
were modeled as one with line losses used to distinguish standards.
** For equipment classes that were not analyzed, DOE did not develop
specific cost-efficiency curves but attributed the curve (and maximum
technology point) from one of the analyzed equipment classes.
Table III.3--Max-Tech Levels for Continuous Automatic Commercial Ice
Makers
------------------------------------------------------------------------
Energy use lower
Equipment type than baseline
------------------------------------------------------------------------
IMH-W-Small-C..................................... Not analyzed--
similar to IMH-A-
Large-C (820).
IMH-W-Large-C..................................... Not analyzed at
1,000 lb/day--
similar to IMH-A-
Large-C (820) Not
analyzed at 1,800
lb/day--similar to
IMH-A-Large-C
(820).
IMH-A-Small-C..................................... 25.3%.
IMH-A-Large-C..................................... 17% (at 820 lb ice/
24 hours) Not
analyzed at 1,800
lb/day--similar to
IMH-A-Large-C
(820).
RCU-Small-C....................................... Not analyzed--
similar to IMH-A-
Large-C (820).
RCU-Large-C....................................... Not analyzed--
similar to IMH-A-
Large-C (820).
SCU-W-Small-C..................................... Not analyzed--
similar to SCU-A-
Small-C.
SCU-W-Large-C *................................... No units available.
SCU-A-Small-C..................................... 24%.
SCU-A-Large-C *................................... No units available.
------------------------------------------------------------------------
* DOE's investigation of equipment on the market revealed that there are
no existing products in either of these two equipment classes (as
defined in this NOPR).
** For equipment classes that were not analyzed, DOE did not develop
specific cost-efficiency curves but attributed the curve (and maximum
technology point) from one of the analyzed equipment classes.
D. Energy and Water Savings
1. Determination of Savings
For each TSL, DOE projected energy savings from automatic
commercial ice makers purchased in the 30-year period that begins in
the year of compliance with amended and new standards (2018-2047). The
savings are measured over the entire lifetime of equipment purchased in
the 30-year period. DOE quantified the energy savings attributable to
each TSL as the difference in energy consumption between each standards
case and the base case. The base case represents a projection of energy
consumption in the absence of amended mandatory efficiency standards,
and considers market forces and policies that affect demand for more-
efficient equipment.
DOE used its NIA spreadsheet model to estimate energy savings from
amended standards for the equipment that are the subject of this
rulemaking. The NIA spreadsheet model (described in section IV.H of
this notice) calculates energy savings in site energy, which is the
energy directly consumed by equipment at the locations where they are
used.
Because automatic commercial ice makers use water, water savings
were quantified in the same way as energy savings.
For electricity, DOE reports national energy savings in terms of
the savings in energy that is used to generate and transmit the site
electricity. To convert this quantity, DOE derives annual conversion
factors from the model used to prepare the Energy Information
Administration's (EIA's) Annual Energy Outlook.
DOE has also begun to estimate full-fuel-cycle (FFC) energy
savings. 76 FR 51282 (Aug. 18, 2011). The FFC metric includes the
energy consumed in extracting, processing, and transporting primary
fuels, and thus presents a more complete picture of the impacts of
efficiency standards. DOE's approach is based on calculation of an FFC
multiplier for each of the fuels used by covered equipment.
2. Significance of Savings
As noted above, 42 U.S.C. 6295(o)(3)(B) prevents DOE from adopting
a standard for a covered product unless such standard would result in
``significant'' energy savings. Although the term ``significant'' is
not defined in the Act, the U.S. Court of Appeals, in Natural Resources
Defense Council v. Herrington, 768 F.2d 1355, 1373 (D.C. Cir. 1985),
indicated that Congress intended ``significant'' energy savings in this
context to be savings that were not ``genuinely trivial.'' The
estimated energy savings in the 30-year analysis period for the TSLs
(presented in section V.A) are nontrivial, and, therefore, DOE
considers them ``significant'' within the meaning of section 325 of
EPCA.
E. Economic Justification
1. Specific Criteria
EPCA provides seven factors to be evaluated in determining whether
a potential energy conservation standard is economically justified. (42
U.S.C. 6295(o)(2)(B)(i) and 6313(d)(4)) The following sections
generally discuss how DOE is addressing each of those seven factors in
this rulemaking. For further details and the results of DOE's
[[Page 14858]]
analyses pertaining to economic justification, see sections IV and V of
today's rulemaking.
a. Economic Impact on Manufacturers and Commercial Customers
In determining the impacts of an amended standard on manufacturers,
DOE first uses an annual cash flow approach to determine the
quantitative impacts. This step includes both a short-term assessment--
based on the cost and capital requirements during the period between
when a regulation is issued and when entities must comply with the
regulation--and a long-term assessment over a 30-year period. The
industry-wide impacts analyzed include INPV, which values the industry
on the basis of expected future cash flows; cash flows by year; changes
in revenue and income; and other measures of impact, as appropriate.
Second, DOE analyzes and reports the impacts on different types of
manufacturers, including impacts on small manufacturers. Third, DOE
considers the impact of standards on domestic manufacturer employment
and manufacturing capacity, as well as the potential for standards to
result in plant closures and loss of capital investment. Finally, DOE
takes into account cumulative impacts of various DOE regulations and
other regulatory requirements on manufacturers.
For a detailed description of the methodology used to assess the
economic impact on manufacturers, see section IV.J of this rulemaking.
For results, see section V.B.2 of this rulemaking. Additionally,
chapter 12 of the NOPR TSD contains a detailed description of the
methodology and discussion of the results.
For individual customers,\18\ measures of economic impact include
the changes in LCC and the PBP associated with new or amended
standards. The LCC, which is specified separately in EPCA as one of the
seven factors to be considered in determining the economic
justification for a new or amended standard, 42 U.S.C.
6295(o)(2)(B)(i)(II), is discussed in the following section. For
customers in the aggregate, DOE also calculates the national net
present value of the economic impacts applicable to a particular
rulemaking. For a description of the methodology used for assessing the
economic impact on customers, see sections IV.G and IV.H; for results,
see sections V.B.1 and V.B.2 of this rulemaking. Additionally, chapters
8 and 10 and the associated appendices of the NOPR TSD contain a
detailed description of the methodology and discussion of the results.
For a description of the methodology used to assess the economic impact
on manufacturers, see section IV.J; for results, see section V.B.2 of
this rulemaking. Additionally, chapter 12 of the NOPR TSD contains a
detailed description of the methodology and discussion of the results.
---------------------------------------------------------------------------
\18\ Customers, or consumers, in the case of commercial and
industrial equipment, are considered to be the businesses that
purchase or lease the equipment or may be responsible for the cost
of operating the equipment.
---------------------------------------------------------------------------
b. Life-Cycle Costs
The LCC is the sum of the purchase price of equipment (including
its installation) and the operating costs (including energy, water,
maintenance, and repair expenditures) discounted over the lifetime of
the equipment. The LCC savings for the considered efficiency levels are
calculated relative to a base case that reflects projected market
trends in the absence of new or amended standards. The LCC analysis
requires a variety of inputs, such as product prices, product energy
and water consumption, energy and water prices, maintenance and repair
costs, product lifetime, and consumer discount rates. For its analysis,
DOE assumes that consumers will purchase the considered equipment in
the first year of compliance with amended standards.
To account for uncertainty and variability in specific inputs, such
as equipment lifetime and discount rate, DOE uses a distribution of
values, with probabilities attached to each value. DOE identifies the
percentage of customers estimated to receive LCC savings, or experience
an LCC increase, in addition to the average LCC savings associated with
a particular standard level. DOE also evaluates the LCC impacts of
potential standards on identifiable subgroups of customers that may be
affected disproportionately by a national standard. For the results of
DOE's analyses related to the LCC, see section V.B.1 of this rulemaking
and chapter 8 of the NOPR TSD; for LCC impacts on identifiable
subgroups, see section V.B.1 of this notice and chapter 11 of the NOPR
TSD.
c. Energy Savings
Although significant conservation of energy is a separate statutory
requirement for imposing an energy conservation standard, EPCA requires
DOE, in determining the economic justification of a standard, to
consider the total projected energy savings that are expected to result
directly from the standard. (42 U.S.C. 6295(o)(2)(B)(i)(III) and
6313(d)(4)) As discussed in section VI.B.3, DOE uses the NIA
spreadsheet to project energy savings.
d. Lessening of Utility or Performance of Equipment
In establishing classes of equipment, and in evaluating design
options and the impact of potential standard levels, DOE evaluates
standards that would not lessen the utility or performance of the
equipment under consideration. (42 U.S.C. 6295(o)(2)(B)(i)(IV) and
6313(d)(4)) The standards proposed in today's rulemaking will not
reduce the utility or performance of the equipment considered in the
rulemaking. For DOE's analyses related to the potential impact of
amended standards on equipment utility and performance, see section
V.B.4 of this rulemaking and chapter 4 of the NOPR TSD.
e. Impact of Any Lessening of Competition
EPCA directs DOE to consider the impact of any lessening of
competition, as determined in writing by the Attorney General, that is
likely to result from the imposition of a standard. (42 U.S.C.
6295(o)(2)(B)(i)(V)) It directs the Attorney General to make such
determination, if any, of any lessening of competition likely to result
from a proposed standard, and to transmit such determination to the
Secretary, within 60 days of the publication of a proposed rule,
together with an analysis of the nature and extent of the impact. (42
U.S.C. 6295(o)(2)(B)(ii)) DOE will transmit a copy of today's proposed
rule to the Attorney General with a request that the Department of
Justice (DOJ) provide its determination on this issue. DOE will address
the Attorney General's determination in the final rule.
f. Need of the Nation To Conserve Energy
The energy savings from the proposed standards are likely to
provide improvements to the security and reliability of the nation's
energy system. Reductions in the demand for electricity also may result
in reduced costs for maintaining the reliability of the nation's
electricity system. DOE conducts a utility impact analysis to estimate
how standards may affect the nation's needed power generation capacity.
(42 U.S.C. 6295(o)(2)(B)(i)(VI) and 6316(e)(1))
The proposed standards also are likely to result in environmental
benefits in the form of reduced emissions of air pollutants and
greenhouse gases (GHGs) associated with energy production. DOE reports
the emissions impacts from today's standards, and from each TSL it
considered, in sections IV.K, IV.L and V.B.6 of this rulemaking. DOE
also
[[Page 14859]]
reports estimates of the economic value of emissions reductions
resulting from the considered TSLs.
g. Other Factors
EPCA allows the Secretary of Energy, in determining whether a new
or amended standard is economically justified, to consider any other
factors that the Secretary deems to be relevant. (42 U.S.C.
6295(o)(2)(B)(i)(VII) and 6316(e)(1)) In developing this proposed rule,
DOE has also considered the comments submitted by interested parties.
For the results of DOE's analyses related to other factors, see section
V.B.7 of this rulemaking.
2. Rebuttable Presumption
As set forth in 42 U.S.C. 6295(o)(2)(B)(iii) and 6313(d)(4), EPCA
provides for a rebuttable presumption that an energy conservation
standard is economically justified if the additional cost to the
customer of equipment that meets the new or amended standard level is
less than three times the value of the first year's energy savings
resulting from the standard, as calculated under the applicable DOE
test procedure. DOE's LCC and PBP analysis generates values used to
calculate the effects that proposed energy conservation standards would
have on the PBP for customers. These analyses include, but are not
limited to, the 3-year PBP contemplated under the rebuttable
presumption test. In addition, DOE routinely conducts an economic
analysis that considers the full range of impacts to the customer,
manufacturer, the Nation, and environment, as required under 42 U.S.C.
6295(o)(2)(B)(i) and 6313(d)(4). The results of these analyses serve as
the basis for DOE's evaluation of the economic justification for a
potential standard level (thereby supporting or rebutting the results
of any preliminary determination of economic justification). The
rebuttable presumption payback calculation is discussed in section
IV.G.12 of this rulemaking and chapter 8 of the NOPR TSD.
IV. Methodology and Discussion of Comments
A. General Rulemaking Issues
During the February 2012 preliminary analysis public meeting and in
subsequent written comments, stakeholders provided input regarding
general issues pertinent to the rulemaking, such as issues of scope of
coverage and DOE's authority in setting standards. These issues are
discussed in this section.
1. Statutory Authority
In the preliminary analysis, DOE stated its position that EPCA
prevents the setting of both energy performance standards and
prescriptive design requirements (see chapter 2 of the preliminary
analysis TSD). DOE also stated its intent to amend the energy
performance standards for automatic commercial ice makers, and not to
set prescriptive design requirements at this time (see chapter 2 of the
preliminary analysis TSD).
2. Test Procedures
As discussed in section III.A, DOE published a test procedure final
rule in January 2012 (2012 test procedure final rule). 77 FR 1591 (Jan.
11, 2012). All automatic commercial ice makers covered by DOE energy
conservation standards promulgated as a result of this energy
conservation standards rulemaking will be required to use the 2012 test
procedures to demonstrate compliance beginning on the compliance date
set at the conclusion of this rulemaking. 77 FR at 1593 (Jan. 11,
2012). The standards can be found at title 10 CFR part 431, subpart H
(or, alternatively, 10 CFR 431.134).
Since the publication of the 2012 test procedure final rule, DOE
has received several inquiries from interested parties regarding proper
conduct of the DOE test procedure. Specifically, interested parties
inquired regarding the appropriate use of baffles and automatic purge
water controls during the DOE test procedure. On January 28, 2013, DOE
published draft guidance documents to address the issues regarding
baffles \19\ and automatic purge water controls \20\ and provided an
opportunity for interested parties to comment on those interpretations
of the DOE test procedure for automatic commercial ice makers. The
comment period for those guidance documents extended until February 28,
2013. DOE will publish a final guidance document and responses to all
comments received on the DOE Appliance and Commercial Equipment
Standards Web site (www1.eere.energy.gov/guidance/default.aspx?pid=2&spid=1). However, DOE notes that these guidance
documents serve only to clarify existing test procedure requirements,
as established in the 2012 test procedure final rule, and do not alter
the DOE test procedure.
---------------------------------------------------------------------------
\19\ https://www1.eere.energy.gov/buildings/appliance_standards/pdfs/acim_baffles_faq_2013-9-24final.pdf.
\20\ https://www1.eere.energy.gov/buildings/appliance_standards/pdfs/acim_purge_faq_2013-9-25final.pdf.
---------------------------------------------------------------------------
DOE's test procedures are set in separate rulemaking processes.
However, as part of the automatic commercial ice maker energy
conservation standards rulemaking, DOE did receive two comments related
to the test procedures. Howe noted that measuring potable water use is
important because de-scaling is crucial for maintaining the efficiency
and utility of automatic commercial ice makers. Howe also recommended
that DOE obtain information from additional manufacturers on the
relationship between potable water use and automatic commercial ice
maker performance. (Howe, No. 51 at p. 2) \21\
---------------------------------------------------------------------------
\21\ A notation in this form provides a reference for
information that is in the docket of DOE's ``Energy Conservation
Program for Certain Commercial and Industrial Equipment: Energy
Conservation Standards for Automatic Commercial Ice Makers'' (Docket
No. EERE-2010-BT-STD-0037), which is maintained at
www.regulations.gov. This notation indicates that the statement
preceding the reference is document number 51 in the docket for the
automatic commercial ice makers energy conservation standards
rulemaking, and appears at page 2 of that document.
---------------------------------------------------------------------------
The People's Republic of China (China) noted that there are
differences among test processes for refrigeration products issued by
different bodies in the U.S. China stated that different test
procedures may lead to different results for one product, and it will
affect the judgment of compliance. Therefore, China suggested that the
U.S. government unify the test procedure. (China, No. 55 at p. 3)
As noted earlier, the 2012 test procedure final rule was published
on January 11, 2012, and the energy conservation standards will be
based on this test procedure. 77 FR at 1593. With regard to Howe's
comment, in the final rule, DOE elected to not require measurement of
potable water. Since DOE is not setting potable water limits for
automatic commercial ice makers, requiring manufacturers to measure
potable water use would be an unnecessary expense. With regard to
China's comment, DOE has no authority regarding adjustment of the test
procedures of other organizations. Also, if there is any uncertainty
regarding how to conduct the test, manufacturers and others may request
clarification from DOE. By updating the test procedure to reflect
current AHRI and ANSI/ASHRAE standards, DOE expects any differences of
the type noted by China will be minimized.
3. Need for and Scope of Rulemaking
At the February 2012 preliminary analysis public meeting and in
written
[[Page 14860]]
comments, DOE received comments about the need for the rulemaking.
Hoshizaki suggested DOE not adjust the energy standards for automatic
commercial ice makers regulated under EPACT 2005, arguing that
tightening the regulations that were just released 2 years ago would
negatively impact both manufacturers and end users. (Hoshizaki, No. 53
at p. 3) AHRI opined that, because the full effects of the EPACT 2005
standards will not be known until at least 2013, DOE should only
consider the previously uncovered continuous and high-capacity batch
type ice makers in this rulemaking. (AHRI, No. 49 at p. 3)
Scotsman asked whether the upcoming rulemaking would cover products
that both make and dispense ice. (Scotsman, Public Meeting Transcript,
No. 42 at p. 26) \22\
---------------------------------------------------------------------------
\22\ A notation in the form ``Scotsman, Public Meeting
Transcript, No. 42 at p. 26'' identifies a comment that DOE has
received during a public meeting and has included in the docket of
this rulemaking at www.regulations.gov. This particular notation
refers to a comment: (1) Submitted by Scotsman; (2) transcribed from
the public meeting in document number 42 of the docket, and (3)
appearing on page 26 of that document.
---------------------------------------------------------------------------
In response to the comments about the need for starting this
rulemaking, DOE notes that under EPACT 2005, DOE must review the
existing standards and, if justified, develop amended standards by
January 1, 2015. Thus, DOE commenced the rulemaking to ensure
compliance with the statutory deadline. During the rulemaking, DOE
considered alternatives to this rulemaking in the regulatory impact
analysis; this analysis is described in Section IV.O of today's NOPR.
As for covering products that make and dispense ice, the scope of the
rulemaking is ice-making products. While the 42 U.S.C. 6311(19)
definition of automatic commercial ice maker stated an ice maker may or
may not include a means for dispensing or storing ice, not all ice
makers do include such ancillary equipment. As discussed in the
preliminary analysis TSD, section 2.2.4.2, DOE determined that
promulgating standards to regulate the energy usage of dispensers and
storage bins may have an unintended impact on customer choices when
choosing between models that include or do not include such ancillary
equipment. By regulating energy usage of ancillary equipment, DOE could
disincentivize the manufacturing of such equipment. If, and to the
extent that, ice dispensing equipment use electricity, such electricity
usage is not covered by this rulemaking.
B. Market and Technology Assessment
When beginning an energy conservation standards rulemaking, DOE
develops information that provides an overall picture of the market for
the equipment concerned, including the purpose of the equipment, the
industry structure, and market characteristics. This activity includes
both quantitative and qualitative assessments based primarily on
publicly available information (e.g., manufacturer specification
sheets, industry publications) and data submitted by manufacturers,
trade associations, and other stakeholders. The subjects addressed in
the market and technology assessment for this rulemaking include: (1)
Quantities and types of equipment sold and offered for sale; (2) retail
market trends; (3) equipment covered by the rulemaking; (4) equipment
classes; (5) manufacturers; (6) regulatory requirements and non-
regulatory programs (such as rebate programs and tax credits); and (7)
technologies that could improve the energy efficiency of the equipment
under examination. DOE researched manufacturers of automatic commercial
ice makers and made a particular effort to identify and characterize
small business manufacturers. See chapter 3 of the NOPR TSD for further
discussion of the market and technology assessment.
1. Equipment Classes
In evaluating and establishing energy conservation standards, DOE
generally divides covered equipment into classes by the type of energy
used, or by capacity or another performance-related feature that
justifies a different standard for equipment having such a feature. (42
U.S.C. 6295(q) and 6313(d)(4)) In deciding whether a feature justifies
a different standard, DOE must consider factors such as the utility of
the feature to users. Id. DOE normally establishes different energy
conservation standards for different equipment classes based on these
criteria.
Automatic commercial ice makers are divided into equipment classes
based on physical characteristics that affect commercial application,
equipment utility, and equipment efficiency. These equipment classes
are based on the following criteria:
Ice-making process
[cir] ``Batch'' icemakers that operate on a cyclical basis,
alternating between periods of ice production and ice harvesting
[cir] ``Continuous'' icemakers that can produce and harvest ice
simultaneously
Equipment configuration
[cir] Ice-making head (a single-package ice-making assembly that
does not include an ice storage bin)
[cir] Remote condensing
[ssquf] With remote compressor (compressor packaged with the condenser)
[ssquf] Without remote compressor (compressor packaged with the
evaporator)
[cir] Self-contained (with storage bin included)
Condenser cooling
[cir] Air-cooled
[cir] Water-cooled
Capacity range
Table IV.1 shows the 25 automatic commercial ice maker equipment
classes that DOE is including in the scope of this rulemaking. The
capacity ranges for the continuous units have changed from the
preliminary analysis.
Table IV.1--Automatic Commercial Ice Maker Equipment Classes
----------------------------------------------------------------------------------------------------------------
Type of
Type of ice maker Equipment type condenser Rated harvest rate lb ice/24
cooling hours
----------------------------------------------------------------------------------------------------------------
Ice-Making Head................ Water........... >=50 and <500
>=500 and <1,436
>=1,436 and <4,000
Air............. >=50 and <450
>=450 and <4,000
Batch......................... Remote Condensing (but not Air............. >=50 and <1,000
remote compressor).
>=1,000 and <4,000
Remote Condensing and Remote Air............. >=50 and <934
Compressor. >=934 and <4,000
[[Page 14861]]
Self-Contained Unit............ Water........... >=50 and <200
>=200 and <4,000
Air............. >=50 and <175
>=175 and <4,000
Ice-Making Head................ Water........... >=50 and <900
>=900 and <4,000
Air............. >=50 and <700
>=700 and <4,000
Remote Condensing (but not Air............. >=50 and <850
remote compressor). >=850 and <4,000
Continuous.................... Remote Condensing and Remote Air............. >=50 and <850
Compressor.
>=850 and <4,000
Self-Contained Unit............ Water........... >=50 and <900
>=900 and <4,000
Air............. >=50 and <700
>=700 and <4,000
----------------------------------------------------------------------------------------------------------------
Batch type and continuous type ice makers are distinguished by the
mechanics of their respective ice-making processes. Continuous type ice
makers are so named because they simultaneously produce and harvest ice
in one continuous, steady-state process. The ice produced in continuous
processes is called ``flake'' or ``nugget'' ice, which is often a
``soft'' ice with high liquid water content, in the range from 10 to 35
percent, but can also be subcooled, i.e., be entirely frozen and at
temperature lower than 32 [deg]F. Continuous type ice makers were not
included in the EPACT 2005 standards and are therefore not currently
regulated by DOE energy conservation standards.
Current energy conservation standards cover batch type ice makers
that produce ``cube'' ice, which is defined as ice that is fairly
uniform, hard, solid, usually clear, and generally weighs less than two
ounces (60 grams) per piece, as distinguished from flake, crushed, or
fragmented ice. 10 CFR 431.132 Batch ice makers alternate between
freezing and harvesting periods and therefore produce ice in discrete
batches rather than in a continuous process. After the freeze period,
hot gas is typically redirected from the compressor discharge to the
evaporator, melting the surface of the ice cubes that is in contact
with the evaporator surface, enabling them to be removed from the
evaporator. The evaporator is then purged with potable water, which
removes impurities that would decrease ice clarity. Consequently, batch
type ice makers typically have higher potable water usage than
continuous type ice makers.
After the publication of the Framework document, several parties
commented that machines producing ``tube'' ice, which is created in a
batch process identical to that which produces cube ice, should also be
regulated. DOE notes that tube ice machines of the covered capacity
range that produce ice fitting the definition for cube type ice are
covered by the current standards, whether or not they are referred to
as cube type ice makers within the industry. Nonetheless, DOE has
addressed the commenters' suggestions by emphasizing that all batch
type ice machines are within the scope of this rulemaking, as long as
they fall within the covered capacity range of 50 to 4,000 lb ice/24
hours. This includes tube ice makers and other batch type ice machines
(if any) that produce ice that does not fit the definition of cube type
ice. To help clarify this issue, DOE now refers to all batch automatic
commercial ice makers as ``batch type ice makers,'' regardless of the
shape of the ice pieces that they produce. 77 FR 1591 (Jan. 11, 2012).
During the February 2012 preliminary analysis public meeting and in
subsequent written comments, a number of stakeholders addressed issues
related to proposed equipment classes and the inclusion of certain
types of equipment in the analysis. These topics are discussed in this
section.
a. Cabinet Size
Currently, DOE does not consider physical size as a criterion for
setting equipment classes.
Several stakeholders commented on the size standardization of ice
makers. Scotsman commented that most ice makers are built in standard
widths of 22, 30, and 48 inches and standard depths between 24 and 28
inches, although heights may vary slightly depending on the machine.
(Scotsman, Public Meeting Transcript, No. 42 at p. 61) Manitowoc noted
that the reason for this standardization is that most ice storage bins
have standard sizes based on ice-making capacity, and the footprint of
the ice maker on top needs to be the same as the footprint of the
storage bin in order for them to fit together. Hence, according to
Manitowoc, the industry has developed common sizes that have
facilitated ice maker installations and replacements. (Manitowoc,
Public Meeting Transcript, No. 42 at pp. 91-92) Howe countered that,
contrary to the assertions of other stakeholders, there are no
``standard'' ice maker dimensions. (Howe, No. 51 at pp. 1-2)
Earthjustice commented that it may be helpful to use cabinet size
as an additional criterion for defining equipment classes because the
existing standard sizes of ice makers affect their efficiency and their
utility to the consumer, both of which are factors that DOE typically
considers in identifying equipment classes. (Earthjustice, Public
Meeting Transcript, No. 42 at pp. 90-91)
However, Manitowoc commented that it manufactures ice makers in
different cabinet sizes that deliver the same ice-making capacity,
explaining that this facilitates flexible installation decisions but
could complicate efforts to define equipment classes by cabinet size.
(Manitowoc, Public Meeting Transcript, No. 42 at p. 91)
The Appliance Standards Awareness Project (ASAP) commented that it
would be helpful to see a size analysis that would elucidate the
effects of size on utility to the customer and potential energy
savings. (ASAP, Public Meeting Transcript, No. 42 at pp. 73-74)
As noted by Manitowoc and Scotsman, there are standard sizes for
[[Page 14862]]
ice makers. DOE's review of product literature supports these claims,
in contrast to Howe's assertion that there are no standard sizes.
However, not all customers face size constraints.
DOE notes that a reason to consider separate equipment classes
based on physical dimensions is to address differences in energy
efficiency. An important size-related factor that can affect the
efficiency of an ice maker is the size of its heat exchangers (i.e.,
the evaporator and condenser).\23\ A larger evaporator can make more
ice per freeze cycle. Hence, for a given harvest capacity rate, the
cycle can be allowed to take longer, thus reducing the required heat
transfer rate per evaporator surface. The reduced heat transfer rate
can be provided by a lower temperature differential between the ice and
the refrigerant. Likewise, as the surface area of a condenser
increases, the temperature differential between the refrigerant and the
cooling medium (either air or water) decreases. These design changes
can lead to higher evaporating temperature and lower condensing
temperature, which both reduce the pressure differential between the
compressor suction and discharge ports, which reduces the amount of
electrical power necessary to compress the vapor, thus reducing energy
consumption of the ice maker.
---------------------------------------------------------------------------
\23\ Other examples are use of some higher-efficiency
compressors, which can be physically larger, and packaging of drain
water heat exchangers within the equipment package.
---------------------------------------------------------------------------
To address size limitations and to save energy, DOE could consider
Earthjustice's recommendation to use size as a criterion in setting
equipment classes. To do so, DOE could establish parallel sets of
equipment classes--size-constrained classes (in which physical size
would be limited to a prescribed maximum) and non-size-constrained
classes (for which there would be no size restrictions). In the size-
constrained classes, DOE's ability to set stricter energy usage limits
would be limited by the constraint that the physical size of the unit
cannot be increased. In the non-size-constrained classes, additional
energy savings could be achieved by setting standards that increase the
physical size of the unit as well as making the units more efficient.
Accounting for size constraints is important in the automatic
commercial ice maker industry because replacement sales comprise a
majority of sales and equipment must be able to fit into the same space
as the unit it replaces, and fit on existing ice storage bins, as
described above. For opportunities in which physical size is not
critical, non-size-constrained equipment classes could save energy
relative to the size-constrained units. If DOE decided not to establish
separate equipment classes for space-constrained equipment, it may not
be reasonable for DOE to consider design options that significantly
increase physical size of the equipment, which would limit potential
efficiency gains and/or make them more costly, thus likely resulting in
less stringent standards for size-limited equipment classes.
Previous DOE rulemakings provide ample precedent for creating
space-constrained equipment classes. For instance, DOE developed space-
constrained equipment classes for packaged terminal air conditioners
and through-the-wall air conditioners, both of which represent
industries in which replacement comprises a majority of sales. 10 CFR
430.32
To determine whether space constraint is an issue (i.e., whether
efficiency and physical size are direct functions of one another), DOE
followed ASAP's suggestion and prepared an analysis of the size and
efficiency of automatic commercial ice makers. Using publicly available
manufacturer information, DOE collected size \24\ data for
approximately 600 ice makers and mapped it to efficiency information
listed in the AHRI database. After plotting and analyzing this data,
DOE determined that, although there is a correlation between size and
efficiency in automatic commercial ice makers, this correlation is not
conclusive.
---------------------------------------------------------------------------
\24\ Size is expressed in terms of volume, calculated by
multiplying unit width by unit depth and by unit height (width x
depth x height).
---------------------------------------------------------------------------
Table IV.2 displays sample results of this size analysis,
presenting information for two different large, air-cooled IMH batch
type ice makers at each of several selected harvest capacities. In many
cases, the larger equipment is more efficient. For example, among the
ice makers that can produce 1,500 lb ice/24 hours, the 28 ft\3\
products have total energy consumption values that are lower than the
current energy consumption standard by greater than >20 percent, while
the 19 ft\3\ products have total energy consumption values that are
only 6 percent below the standard. In other cases, the data do not
support this trend. For example, among the 800 lb ice/24 hour ice
makers, the 17 ft\3\ products are less efficient than the 11 ft\3\
products. Finally, in cases such as the 1,430 lb ice/24 hour machines,
there are also products with the same harvest capacity and volume that
nonetheless have different efficiencies. Therefore, it is difficult to
draw a decisive conclusion from this data.
Table IV.2--Relationship between Volume and Efficiency for Large IMH Air-
Cooled Batch Ice Makers
------------------------------------------------------------------------
% Below
baseline
Rated harvest rate lb ice/24 hours Volume ft \3\ energy use
(percent)
------------------------------------------------------------------------
500..................................... 9.1 3.2
12.4 2.2
800..................................... 10.8 13.5
16.8 3.5
1,150................................... 18.0 13.5
20.8 18.1
1,430................................... 20.1 3.0
20.1 4.6
1,530................................... 19.3 6.0
27.7 21.3
------------------------------------------------------------------------
Manitowoc noted during the February 2012 preliminary analysis
public meeting that it produces units with the same harvest rate in
different size chassis sizes, and that these units have very similar
features. (Manitowoc, Public Meeting Transcript, No. 42 at p. 91) DOE,
in its analysis, has noted that some manufacturers have achieved higher
efficiencies for ice makers in smaller sizes (at constant harvest
rates). Based on this information, DOE believes that size does affect
efficiency levels (as it allows for large heat exchangers), but it is
not the definitive factor in determining efficiency for ice makers.
Therefore, DOE has determined that separate equipment classes for
size-constrained units are not warranted. DOE notes that there is not a
strong correlation between product size and product efficiency that
supports separate equipment classes. Furthermore, DOE believes that
adding additional classes for size-constrained units complicates the
equipment class structure and analysis but does not improve the
rulemaking or standards.
b. Large-Capacity Batch Ice Makers
In the November 2010 Framework document for this rulemaking, DOE
requested comments on whether coverage should be expanded from the
current covered capacity range of 50 to 2,500 lb ice/24 hours to
include ice makers producing up to 10,000 lb ice/24 hours. All
commenters agreed with expanding the harvest capacity coverage, and all
but one of the commenters supported or accepted an upper harvest
capacity cap of 4,000 lb ice/24 hours, which would be consistent with
the current test procedure, AHRI Standard 810-2007. Most commenters
categorized ice makers with harvest
[[Page 14863]]
capacities above 4,000 lb ice/24 hours as industrial rather than
commercial. To be consistent with the majority of these comments, DOE
proposed during the preliminary analysis to set the upper harvest
capacity limit to 4,000 lb ice/24 hours, even though there are few ice
makers currently produced with capacities ranging from 2,500 to 4,000
lb ice/24 hours. 77 FR 3405 (Jan. 24, 2012) Since the publication of
the preliminary analysis, DOE revised the test procedure, with the
final rule published in January 2012, to include all batch and
continuous type ice makers with capacities between 50 and 4,000 lb ice/
24 hours. 77 FR 1591, 1613-14 (Jan. 11, 2012). In the 2012 test
procedure final rule, DOE noted that 4,000 lb ice/24 hours represented
a reasonable limit for commercial ice makers, as larger-sized ice
makers were generally used for industrial applications and testing
machines up to 4,000 lb was consistent with AHRI 810-2007. 77 FR 1591
(Jan. 11, 2012). Therefore, because DOE now has a procedure for testing
ice makers with capacities up to 4,000 lb ice/24 hours, DOE proposes in
this NOPR to set efficiency standards that include all ice makers in
this extended capacity range.
In written comments after the publication of the preliminary
analysis, AHRI and Manitowoc both recommended that DOE refrain from
regulating products with capacities above 2,500 lb ice/24 hours if
there are not enough high-capacity batch machines available for DOE to
analyze. (AHRI, No. 49 at pp. 3-4; Manitowoc, No. 54 at p. 3)
DOE acknowledges that there are currently few automatic commercial
ice makers with harvest capacities above 2,500 lb ice/24 hours.
However, DOE already has a precedent of setting standards for harvest
capacity ranges in which there are no products available. There are
currently no IMH air-cooled ice makers on the market with harvest
capacities above 1,650 lb ice/24 hours, yet EPACT 2005 amended EPCA to
set standards for this equipment class of ice makers with harvest
capacities up to 2,500 lb ice/24 hours. Because it is possible that
batch-type ice makers with harvest capacities from 2,500 to 4,000 lb
ice/24 hours will be manufactured in the future, DOE does not find it
unreasonable to set standards in this rulemaking for batch type ice
makers with harvest capacities in the range up to 4,000 lb ice/24
hours. Therefore, DOE maintains its position to include large-capacity
batch type ice makers in the scope of this rulemaking. However, DOE
requests comment and data on the viability of the proposed standard
levels selected for batch-type ice makers with harvest capacities from
2,500 to 4,000 lb ice/24 hours. The proposed standard levels are
discussed in Section V.A.2 of today's NOPR.
c. Efficiency/Harvest Capacity Relationship
In the current energy conservation standards, DOE uses discrete
harvest capacity breakpoints to differentiate cube machine classes, and
DOE proposes to do the same with new classes for continuous machines.
In reviewing industry literature, DOE found that compressor
efficiency increases over a range of harvest rate capacities and then
tends to flatten out at the higher capacities. This trend is
illustrated in Table IV.3, which displays the capacities and energy
efficiency ratios (EERs) of one family of reciprocating compressors. As
shown in this table, the EERs of compressors in this family level off
to between 6.5 and 7.2 British thermal units per watt-hour (Btu/Wh) at
capacities beyond 14,300 Btu per hour.
Table IV.3--Relationship of Compressor Capacity to EER
------------------------------------------------------------------------
Capacity Btu/hr EER Btu/Wh
------------------------------------------------------------------------
7,970 5.8
8,440 5.1
8,840 6.0
9,870 6.2
10,200 5.5
10,900 6.3
11,300 5.5
12,400 7.0
12,900 6.0
14,100 5.9
14,300 6.5
14,900 6.6
18,100 7.0
18,300 6.5
18,600 6.6
19,600 5.6
22,200 6.5
22,500 7.2
24,300 7.1
24,600 6.6
26,000 6.5
29,300 6.7
29,600 6.6
30,500 6.7
31,300 6.9
34,400 6.7
36,700 6.7
42,200 6.8
------------------------------------------------------------------------
Due primarily to the compressor trends discussed above, ice maker
energy usage also varies as products increase in cooling capacity. Ice
maker energy use (in kilowatt-hours per 100 lb of ice) decreases as the
harvest rate increases in all products, but because the compressor
trends do not continue indefinitely, the ice maker energy usage becomes
constant at larger harvest rates. The point at which usage becomes
constant for ice makers varies by equipment type.
DOE has traditionally used a piecewise linear approach \25\ to
depict the standard levels, with the breakpoints defining the harvest
capacity rate limits of different equipment classes. Thus, for the
current energy conservation standards for batch type equipment, the
maximum allowable energy use declines as harvest capacity increases for
the smallest harvest capacity rate equipment classes. In contrast, for
most of the larger harvest capacity rate equipment classes, the maximum
allowable energy use is a constant. The one exception is the large IMH
air-cooled equipment class, where the maximum allowable energy use
continues to decrease as harvest capacity rate increases. DOE believes
that its piecewise energy consumption limits facilitate the simple
calculation of energy standards while accurately depicting the complex
relationship between capacity and efficiency.
---------------------------------------------------------------------------
\25\ A piecewise function is a mathematical relationship where
the relationship between the independent variable and dependent
variable varies over the inspected range. Different functions are
used to describe this relationship for each discrete interval where
this relationship is defined. The piecewise function is a way of
expressing the full relationship (https://mathworld.wolfram.com/PiecewiseFunction.html).
---------------------------------------------------------------------------
Several stakeholders commented on DOE's decision to set piecewise
efficiency levels according to harvest capacity. At the February 2012
preliminary analysis public meeting, the Northwest Power and
Conservation Council (NPCC) questioned whether setting standards by
capacity range would create discontinuous breakpoints in efficiency
requirements that would drive manufacturers to seek one level of
capacity over another to take advantage of a more favorable standard.
(NPCC, Public Meeting Transcript, No. 42 at p. 22) In written comments,
the Northwest Energy Efficiency Alliance (NEEA), NPCC, and the
California Investor-Owned Utilities (CA IOUs) recommended that DOE
imitate ENERGY STAR[supreg] and use a single equation for each
equipment class to define energy consumption standards as a function of
harvest rate, rather than having multiple efficiency standards for
different harvest capacity bins. (NEEA/NPCC, No. 50 at p. 2; CA IOUs,
No. 56 at p. 2) CA IOUs added that, if DOE elects to continue
distinguishing equipment classes based on harvest capacity breakpoints,
it should explain
[[Page 14864]]
its reasoning for doing so. (CA IOUs, No. 56 at p. 3)
The newly finalized ENERGY STAR specification eliminates
discontinuities by using one equation for IMH and self-contained cube
equipment as well as all three continuous equipment types, while
achieving something similar to the asymptotic relationship mentioned by
Manitowoc. The ENERGY STAR specification accomplishes this with
equations that are more complex than those currently embodied in DOE's
cube ice machine standards, which have simple ``intercept and slope''
or ``fixed and variable'' components. For example, DOE's current energy
consumption limit for small IMH air-cooled equipment is as follows:
Maximum Energy Usage (kWh) <= 10.26 - 0.0086H
(Where H = harvest rate capacity, up to 449 lb ice/24 hours)
The April 30, 2012 ENERGY STAR specification for the same equipment
is:
Maximum Energy Usage (kWh) <= 37.72H-\0.298\
By means of a more complicated formula, the ENERGY STAR
specification creates a continuous curve while still respecting the
asymptotic relationship between efficiency and harvest capacity.
Manitowoc commented that it was not particularly important where
the DOE places capacity breakpoints for different equipment classes as
long as the breakpoints respect the asymptotic relationships between
size and efficiency. Manitowoc also asked that there not be any real
discontinuities at these breakpoints or discrepancies from the industry
mean efficiency/capacity relationships. (Manitowoc, Public Meeting
Transcript, No. 42 at pp. 25-26) CA IOUs similarly requested that DOE
base its harvest capacity breakpoints on an investigation of the
market, rather than automatically using pre-existing breakpoints, and
added that any new equipment classes generated by resetting these
breakpoints must not allow backsliding. (CA IOUs, No. 56 at p. 3)
The issue raised by NPCC and echoed by Manitowoc is that the
equations used in the standards can cause points of discontinuity where
rating equipment at slightly different capacity levels provides a
benefit to the manufacturer in terms of allowable energy usage. In the
current standards for IMH water-cooled units, one discontinuity exists
at 500 lb ice/24 hours, the breakpoint between the small and medium
harvest capacity rate equipment classes, where there is a 0.1 kWh/100
lb energy use gap, representing 2.0 percent of the 5.04 kWh/100 lb
maximum allowable energy use at this harvest capacity rate. However,
eliminating this type of gap in the energy conservation standards would
not require departure from a piecewise linear representation of maximum
allowable energy use.
Fitting a curve as was done to create the ENERGY STAR limits would
be more complicated than creating a new standard that mirrors the
existing usage limit structure. It would also be more difficult for
customers, such as restaurant owners, who buy ice makers and need to
make sense of the standards because the ENERGY STAR equation requires a
calculator or a spreadsheet, and, DOE believes, leads to more questions
and complexity.
The single equation approach also runs somewhat contrary to the
comments received from manufacturers. With the single equation provided
by ENERGY STAR, energy usage limits for large machines continue to
decline to zero (albeit at diminishing rates). The manufacturer
comments cited in the discussion of large machines above provided
several reasons that, at very high capacities, design constraints cause
these products to have constant energy usage across different harvest
capacities. This means that, at a certain point, efficiency tends to
become more constant as harvest capacity changes, as is embodied in the
current standards. The single equation approach would make it more
difficult for the DOE standards to reflect this trend in the market.
DOE has decided to continue structuring the equipment classes by
utilizing multiple harvest rate sizes rather than moving to a single
equation approach. By continuing to use multiple size classes, DOE will
have greater flexibility to adequately address the efficiencies of
large equipment classes. The risk of exploiting the system at size
class break points can be mitigated by carefully developing standards.
Moreover, DOE proposes amending the baseline energy standards to
eliminate existing discontinuities at harvest capacity breakpoints.
Note that under the DOE test procedure and specifically the updated
ANSI/ASHRAE Standard 29-2009 that was incorporated by reference in that
rule, harvest rates are to be determined at the time of test, and are
not based on manufacturer specifications. (10 CFR 431.134) Furthermore,
in EPACT 2005, Congress directed DOE to monitor whether manufacturers
reduce harvest rates below tested values for the purpose of bringing
non-complying equipment into compliance. (42 U.S.C. 6316(f)(4)(A)) DOE
therefore intends to carefully assess whether such manipulation occurs
as a result of any final rule using distinct break points.
AHRI Standard 810-2007, as referenced by the DOE test procedure,
states that the energy consumption rate of ice makers should be rounded
to the nearest 0.1 kWh. By considering the standard levels using this
rounding convention, the only existing discontinuity in DOE's standards
for batch type ice makers occurs at the breakpoint of 500 lb/24 hr
between the IMH-W-Small-B and IMH-W-Medium-B equipment classes. In its
analysis, DOE adjusted the baseline energy level for the IMH-W-Small-B
equipment class to 7.79-0.0055H from 7.80-0.0055H. This 0.01 change
eliminates the discontinuity at this breakpoint, as seen in Table IV.4.
In setting up TSLs, DOE sought to ensure that no discontinuities
existed between equipment classes.
Table IV.4--Current Standard and DOE Engineering Baseline for IMH-W-Small-B Equipment Type
----------------------------------------------------------------------------------------------------------------
Current baseline (7.80-
Equipment type 0.0055H) New baseline (7.79-0.0055H)
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B........................... 5.1 (rounded from 5.050)... 5.0 (rounded from 5.040).
IMH-W-Medium-B.......................... 5.0 (rounded from 5.030)... 5.0 (rounded from 5.030).
----------------------------------------------------------------------------------------------------------------
[[Page 14865]]
d. Continuous Ice Maker Equipment Classes
The EPACT 2005 amendments to EPCA did not set standards for
continuous type ice makers. At the February 2012 preliminary analysis
public meeting, DOE presented NES results (see section IV.H.3 of this
notice) that indicated the continuous equipment type accounted for
approximately 0.03 quads of savings potential over the 30-year analysis
period. The savings levels are low primarily because continuous type
ice-making machines represent only 16 percent of automatic commercial
ice maker shipments, of which only two equipment classes (IMH air-
cooled small and self-contained air-cooled small equipment) represent
three-quarters of shipments.
At the February 2012 preliminary analysis public meeting and in
written comments, AHRI and Scotsman both questioned the need to
regulate continuous type ice makers, noting that the preliminary
results of DOE's national impact analysis show negligible NES (rounding
to 0.000 quads) for most continuous type equipment classes. (AHRI, No.
49 at pp. 1-2; Scotsman, No. 46 at p. 5; Scotsman, Public Meeting
Transcript, No. 42 at p. 105)
AHRI and Scotsman questioned the need to include continuous remote
condensing units (RCUs) with remote compressors as equipment classes,
noting that these are niche products that represent a very small
portion of the overall market. AHRI added that their minimal projected
energy savings and low shipment volume would not justify the cost of
testing and certifying these products to DOE. (AHRI, No. 49 at p. 3;
Scotsman, No. 46 at p. 2)
Pursuant to EPCA, DOE is required to set new or amended energy
conservation standards for automatic commercial ice makers to: (1)
Achieve the maximum improvement in energy efficiency that is
technologically feasible and economically justified; and (2) result in
significant conservation of energy. (42 U.S.C. 6295(o)(2)(A) and
(o)(3)(B); 6313(d)(4)) The EPCA language does not require DOE to
determine the significance of savings at the individual equipment class
level in order to justify setting standards for all equipment classes
of an equipment type
DOE has decided to regulate all automatic commercial ice maker
equipment classes. This will bring two important automatic commercial
ice maker classes (self-contained, air-cooled small continuous and IMH
air-cooled small continuous) under regulation. Regulating all equipment
classes will create a consistent approach for regulating continuous
type equipment as was done for batch type equipment.
e. Remote Condensing Unit Classes for Equipment With and Without Remote
Compressors
The current standard levels differentiate between remote condensers
with compressors in the condenser cabinet and remote condensers without
remote compressors. DOE requested comment on whether to retain these
equipment classes as separate groups. (DOE, Public Meeting
Presentation, No. 7 at p. 30)
Numerous stakeholders expressed their support for DOE's
differentiation of RCUs into two separate classes based on the location
of their compressors. Manitowoc raised the issue at the public meeting,
noting that locating the compressor remotely has a measurable impact on
the overall efficiency of an ice maker. (Manitowoc, Public Meeting
Transcript, No. 42 at pp. 24-25) Scotsman added that these two classes
of RCUs perform at different efficiencies in the field and provide
different utility to the customer, thus justifying their separation
into separate equipment classes. (Scotsman, Public Meeting Transcript,
No. 42 at p. 45 and No. 46 at p. 2) NPCC expressed agreement with
Scotsman's comment on the issue. (NPCC, Public Meeting Transcript, No.
42 at p. 45)
Based on DOE's review of these comments and data arising from the
analyses, DOE believes the location of the compressor provides
different customer utility, and that each equipment class experiences
different energy usage trends due to suction line losses. DOE did not
receive any information indicating that these equipment classes should
not be kept separate. Therefore, DOE will continue to categorize RCUs
with and without remote compressors into separate equipment classes.
f. Remote to Rack Equipment
In the preliminary analysis, DOE found that some high-capacity RCU-
RC-Large-C ice makers are solely designed to be used with compressor
racks and the racks' associated condensers. A compressor rack is
typically used with supermarket refrigeration equipment and consists of
several compressors joined in a parallel arrangement to service several
refrigeration products at once. One related issue is that the
manufacturers of these automatic commercial ice makers do not provide
for sale a condensing unit that could be paired with them as an
alternative option. DOE noted that these units do not meet the
statutory definition of ice makers, which states that an ice maker
``consists of a condensing unit and ice-making section operating as an
integrated unit, with means for making and harvesting ice.'' (42 U.S.C.
6311(19)(A)) Hence, DOE determined during the preliminary analysis that
rack-only RCUs are not defined as ice makers under the statute and thus
should not be included in this rulemaking.
Howe recommended that DOE include remote to rack ice makers in the
rulemaking because such units already represent a significant fraction
of annual ice maker shipments and will become even more significant
once the covered capacity range expands to 4,000 lb ice/24 hours.
(Howe, No. 51 at p. 4) Conversely, Scotsman commented that continuous
RCUs with remote compressors comprise a very tiny piece of the overall
automatic commercial ice maker market and thus questioned the need to
establish equipment classes for these products. Scotsman added that
these RCUs are difficult to test \26\ because they are designed to be
connected to supermarket rack systems. (Scotsman, No. 46 at p. 2)
---------------------------------------------------------------------------
\26\ The current and recently completed DOE test procedures do
not provide test procedures for this type of equipment.
---------------------------------------------------------------------------
Earthjustice observed that DOE has not explained why it believes
that ice makers designed for use with remote condenser rack systems do
not consist of ``a condensing unit and ice-making section operating as
an integrated unit, with means for making and harvesting ice,'' as
automatic commercial ice makers are defined. Earthjustice argued that
such ice makers use the same basic components, including both a
condensing unit and an ice-making section. Moreover, Earthjustice
continued, the two components are directly connected, and their
integration is not nullified by the fact that other equipment may also
be connected to the supermarket rack. Earthjustice added that DOE has
long regulated split system residential and commercial air conditioners
despite the fact that the outdoor and indoor components are frequently
made by different firms. (Earthjustice, No. 47 at p. 5)
Given the small market share of large continuous RCU remote
compressor equipment (0.35 percent), DOE finds that Scotsman's claim is
credible in that continuous, rack-only equipment comprises only a
fraction of the 0.35 percent, and thus a tiny piece of the overall
market.
[[Page 14866]]
The Earthjustice comment drawing a parallel to split system
residential air conditioners overlooks key distinctions. Residential
equipment may pair components from different manufacturers, but only
one manufacturer is responsible for the certification.\27\ Supermarket
racks simultaneously serve multiple units of equipment (including
commercial refrigerators and freezers, walk-in coolers and freezers,
ice makers, air conditioners, and heat pumps), so there is no way to
hold one manufacturer responsible for certifying its energy
consumption. Drawing a parallel between these two circumstances is
therefore not reasonable in that respect.
---------------------------------------------------------------------------
\27\ Under DOE regulations, it is possible for more than one
central air conditioner manufacturer to submit certification reports
for a given condensing unit. 10 CFR 429.16 requires manufacturers of
central air conditioners to certify compliance with the energy
conservation standards to DOE. Where a coil manufacturer may offer a
coil for sale to be matched with a condensing unit made by another
manufacturer (mix-matched combination), the coil manufacturer can
make representations for condensing unit coil combination, but,
since the condensing unit manufacturer does not offer for sale the
mixed-matched combination, only the coil manufacturer offering the
combination for sale is responsible for certification of that
combination.
---------------------------------------------------------------------------
Therefore, DOE decided to maintain its position not to cover rack-
only RCU units in this standards rulemaking. DOE does request comment
and supporting data on the overall market share of these units and any
expected market trends.
g. Ice Makers Covered by the Energy Policy Act of 2005
Of the 25 equipment classes that DOE is considering in this
rulemaking, 13 are already covered under energy conservation standards
that were set for cube type ice makers as part of EPACT 2005. Current
automatic commercial ice maker standards covering cube type ice makers
took effect on January 1, 2010. Under the requirements of EPCA, DOE
must review and make a determination as to whether amendments to the
standards are technologically and economically justified by January 1,
2015. (42 U.S.C. 6313(d)(3)(A))
In written comments, AHRI opined that, because the full effects of
the EPACT 2005 ruling will not be known until at least 2013, DOE should
only consider the previously uncovered continuous and high-capacity
batch type ice makers in this rulemaking. (AHRI, No. 49 at p. 3)
Similarly, Hoshizaki asked DOE not to adjust the energy standards for
automatic commercial ice makers that are currently covered, arguing
that tightening the regulations that were just released two years ago
would negatively impact both manufacturers and end users. (Hoshizaki,
No. 53 at p. 3)
DOE is required by statute to review the standards and, if amended
standards are technologically feasible and economically justified, to
issue a rule to amend the standards. (42 U.S.C. 6313(d)(3)(A))
Manufacturers have asserted that the automatic commercial ice maker
industry is a small component of the commercial refrigeration industry,
and that given their size they have little or no influence with the
manufacturers of major components such as compressors. (Manitowoc,
Public Meeting Transcript, No. 42 at pp. 14-15) Manufacturers noted
that they are generally restricted to design options available to
larger customers. (Manitowoc, Public Meeting Transcript, No. 42 at pp.
15)
Consistent with the comments from manufacturers, DOE's engineering
analysis included design options that are viable for automatic
commercial ice makers. Most of the design options are extensively used
in existing products, and a few design options (brushless DC motors)
are available but rarely implemented in this equipment. Chapter 5 of
the NOPR TSD contains further details of the analysis for each design
option used.
DOE has alternatives with respect to the date that new standards
would take effect. EPCA requires that the amended standards established
in this rulemaking must apply to equipment that is manufactured on or
after 3 years after the final rule is published in the Federal Register
unless DOE determines, by rule, that a 3-year period is inadequate, in
which case DOE may extend the compliance date for that standard by an
additional 2 years. (42 U.S.C. 6313(d)(3)(C))
For the NOPR analyses, DOE assumed a 3-year period to prepare for
compliance. DOE requests comments on whether a January 1, 2018
effective date provides an inadequate period for compliance and what
economic impacts would be mitigated by a later effective date.
DOE also requests comment on whether the 3-year period is adequate
for manufacturers to obtain more efficient components from suppliers to
meet proposed revisions of standards.
h. Regulation of Potable Water Use
Under EPACT 2005, water used for ice--referred to as potable
water--was not regulated for automatic commercial ice makers.
The amount of potable water used varies significantly among batch
type automatic commercial ice makers (i.e., cube, tube, or cracked ice
machines). Continuous type ice makers (i.e., flake and nugget machines)
convert essentially all of the potable water to ice, using roughly 12
gallons of water to make 100 lb of ice. Batch type ice makers use an
additional 3 to 38 gallons of water in the process of making 100 lb of
ice. This additional water is referred to as ``dump or purge water''
and is used to cleanse the evaporator of impurities that could
interfere with the ice-making process.
The Alliance for Water Efficiency (Alliance), the Natural Resources
Defense Council (NRDC), and CA IOUs proposed that DOE regulate the
water use of automatic commercial ice makers. (Alliance, No. 45 at pp.
3-4; NRDC, No. 48 at p. 2; CA IOUs, No. 56 at p. 6) The Alliance noted
that the potable water lost from purging represents a waste of the
energy required to pump, treat, deliver, and dispose of this water on a
national scale. This embedded energy use, the Alliance argued, gives
DOE justification to include water efficiency standards along with its
energy efficiency standards for automatic commercial ice makers. The
Alliance recommended that DOE analyze technical data from real ice
makers in order to accurately determine the minimum potable purge water
rate required to prevent scaling. The Alliance also observed that the
huge variation in potable water use among ice makers of similar
capacities suggests that some ice makers may be purging water at
excessive rates in order to overcome poor maintenance practices and
schedules, which is not a justifiable excuse in the opinion of the
Alliance. (Alliance, No. 45 at pp. 3-4) CA IOUs also recommended that
DOE consider establishing potable water use limits, especially because
the ENERGY STAR program already includes such limits. (CA IOUs, No. 56
at p. 6)
In response to comments from the Alliance, NRDC, and CA IOUs, DOE
was not given a specific mandate by Congress to regulate potable water.
EPCA, as amended, explicitly gives DOE the authority to regulate water
use in showerheads, faucets, water closets, and urinals (42 U.S.C.
6291(6), 6295(j) and (k)), clothes washers (42 U.S.C. 6295(g)(9)(B)),
dishwashers (42 U.S.C. 6295(g)(10)(B)), commercial clothes washers (42
U.S.C. 6313(e)), and batch (cube) commercial ice makers. (42 U.S.C.
6313(d)) With respect to batch commercial ice makers (cube type
machines), however, Congress explicitly set standards in EPACT 2005
only for condenser water use, which appear at 42 U.S.C. 6313(d)(1), and
noted in a footnote to the table that potable water
[[Page 14867]]
use was not included.\28\ Congress thereby recognized both types of
water, and did not provide direction to DOE with respect to potable
water standards. This ambiguity gives the DOE considerable discretion
to regulate or not regulate potable water. The U.S. Supreme Court has
determined that, when legislative intent is ambiguous, a government
agency may use its discretion in interpreting the meaning of a statute,
so long as the interpretation is reasonable.\29\ In the case of ice
makers, EPACT 2005 is ambiguous on the subject of whether DOE must
regulate water usage for purposes other than condenser water usage in
cube-making machines, so DOE therefore has chosen to use its discretion
not to mandate a standard in this case. DOE instead considered potable
water use reduction in batch-type ice makers as a design option for
reducing energy use. DOE notes that the ENERGY STAR program has
implemented potable water consumption requirements.
---------------------------------------------------------------------------
\28\ Footnote to table at 42 U.S.C. 6313(d)(1).
\29\ Nat'l Cable & Telecomms. Ass'n v. Brand X Internet Servs.,
545 U.S. 967, 986 (2005) (quoting Chevron U.S.A. Inc. v. Natural
Res. Def. Council, Inc., 467 U.S. 837, 845 (1984)).
---------------------------------------------------------------------------
Hoshizaki commented that potable water use varies from place to
place, depending on water quality, and added that the market is already
dictated to use less water. (Hoshizaki, Public Meeting Transcript, No.
42 at p. 73) AHRI added that limiting potable water use would decrease
ice clarity and increase scaling, which would subsequently increase the
overall energy use of the ice maker. Therefore, AHRI and Hoshizaki both
recommended against establishing maximum potable water use standards in
this rulemaking because of the reduced utility and efficiency that it
would cause. (AHRI, No. 49 at pp. 2-3; Hoshizaki, No. 53 at p. 1)
The Hoshizaki and AHRI comments suggest that DOE intends to
implement potable water use standards, but this is not the case.
Rather, DOE is simply suggesting that reduction of potable water use is
a viable technology option that satisfies the screening analysis
criteria, as long as reductions are not excessive. This approach does
not establish potable water use maximums since manufacturers are not
required to use this design option in order to meet efficiency
standards. Scotsman noted that the ENERGY STAR program has limited
potable water use in ice makers to 25 gallons per 100 lb of ice and
that the program is moving toward a new standard of 20 gallons per 100
lb of ice, which it believes to be the minimum levels for avoiding
machine performance issues. Scotsman recommended that DOE refer to
these ENERGY STAR standards in determining new potable water use
limits. (Scotsman, Public Meeting Transcript, No. 42 at pp. 64-65 and
No. 46 at p. 5) Manitowoc agreed with Scotsman and added that the new
20 gallons per 100 lb metric was developed with the aid of
manufacturers and that further reducing potable water use could impact
the long-term reliability of its machines. Therefore, Manitowoc stated
that 20 gallons per 100 lb is the lowest water use limit with which it
would be comfortable. (Manitowoc, Public Meeting Transcript, No. 42 at
pp. 65-66)
However, Manitowoc also commented that potable water use is a
variable in the design process that manufacturers have already
optimized to satisfy a number of competing factors. Manitowoc argued
that, although reducing potable water use would improve machine
efficiency up to a point, it would also decrease reliability and
increase the required frequency for cleaning due to scaling. Manitowoc
stated that the design limits for potable water use often depend on
proprietary design elements; therefore, it would be difficult to set
reasonable potable water use standards that were fair to all companies,
in Manitowoc's opinion. (Manitowoc, No. 54 at p. 3)
Howe noted that measuring potable water use is important because
de-scaling is crucial for maintaining the efficiency and utility of
automatic commercial ice makers. Howe also recommended that DOE obtain
information from additional manufacturers on the relationship between
potable water use and ice maker performance. (Howe, No. 51 at p. 2)
DOE has implemented in the analysis the recommendations of several
stakeholders that 20 gallons per 100 lb of ice is a reasonable lower
limit on potable water use for batch type ice makers, especially
considering that there are numerous batch type ice machines that have
potable water use at this level or lower. For example, in implementing
batch water control as a design option, DOE is limiting the reduction
in potable water use to 20 gallons per 100 lb. This should not be
confused with the establishment of a standard--this limit affects the
extent to which a specific design option saves energy by placing a
floor under the potable water usage. Though NRDC claims that reducing
potable water use beyond this level would be feasible and beneficial,
it has not identified specific designs with significantly less potable
water use, nor has it provided data to show that long-term field use of
such equipment is viable. Chapter 5 of the NOPR TSD contains more
information about this analysis.
2. Technology Assessment
As part of the market and technology assessment, DOE developed a
comprehensive list of technologies to improve the energy efficiency of
automatic commercial ice makers, shown in Table IV.5. Chapter 3 of the
NOPR TSD contains a detailed description of each technology that DOE
identified. DOE only considered in its analysis technologies that would
impact the efficiency rating of equipment as tested under the DOE test
procedure. The technologies identified by DOE were carried through to
the screening analysis and are discussed in section IV.C.
[[Page 14868]]
Table IV.5--Technology Options for Automatic Commercial Ice Makers
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Technology options Batch ice ConNotesus
makers ice makers
----------------------------------------------------------------------------------------------------------------
Compressor.................... Improved compressor [radic] [radic]
efficiency.
Part load operation... [radic] [radic]
Condenser..................... Increased surface area [radic] [radic]
Enhanced fin surfaces. [radic] [radic] Air-cooled only.
Increased air flow.... [radic] [radic] Air-cooled only.
Increased water flow.. [radic] [radic] Water-cooled only.
Brazed plate condenser [radic] [radic] Water-cooled only.
Microchannel condenser [radic] [radic]
Fans and Fan Motors........... Higher efficiency [radic] [radic] Air-cooled only.
condenser fans and
fan motors.
Other Motors.................. Improved auger motor ............... [radic]
efficiency.
Improved pump motor [radic]
efficiency.
Controls...................... Smart Technologies.... [radic] [radic]
Evaporator.................... Design options which [radic]
reduce energy loss
due to evaporator
thermal cycling.
Design options which [radic]
reduce harvest
meltage or reduce
harvest time.
Larger evaporator [radic] [radic]
surface area.
Tube evaporator [radic]
configuration.
Insulation.................... Improved insulating [radic] [radic]
material and/or
thicker insulation
around the evaporator
compartment.
Refrigeration Line............ Larger diameter [radic] [radic] RCUs with remote
suction line. compressor.
Potable Water................. Reduced potable water [radic]
flow.
Drain water thermal [radic]
exchange.
----------------------------------------------------------------------------------------------------------------
a. Reduced Potable Water Flow for Continuous Type Ice Makers
Howe questioned why the list of design options for continuous type
ice makers did not include reduced potable water flow, considering that
such machines can have clean or flush cycles. (Howe, Public Meeting
Transcript, No. 42 at pp. 30-31)
DOE notes that some continuous machines may include controls or
design options that may reduce potable water flow. Therefore, DOE has
included reduced potable water flow for continuous machines as one of
its design options.
DOE also notes that the test procedure for continuous type ice
makers calls for three 14.4-minute long measurements of ice-making
production and energy use. The flushing cycles in continuous type ice
makers typically do not occur within these measurement periods and the
water used for flushing is not captured in the energy use metric;
hence, because the engineering analysis cannot evaluate an improvement
that occurs outside of the test procedure, this aspect of equipment
operation was screened out in the screening analysis.
b. Alternative Refrigerants
Scotsman asked whether hydrocarbon refrigerants were considered as
a design option. (Scotsman, Public Meeting Transcript, No. 42 at p. 32)
Manitowoc responded that hydrocarbon refrigerants should not be
considered in the analysis because they have not been approved for use
by the U.S. Environmental Protection Agency's (EPA's) Significant New
Alternatives Policy (SNAP). (Manitowoc, Public Meeting Transcript, No.
42 at p. 32) AHRI added that refrigerants that are used as alternatives
to chlorofluorocarbons (CFCs) and hydrochlorofluorocarbons (HCFCs) must
be approved by both the EPA and the SNAP program. AHRI noted that,
although some hydrocarbon refrigerants were approved for use in
residential refrigerators and some commercial refrigerated display
cases, they have not been approved for ice makers. (AHRI, Public
Meeting Transcript, No. 42 at pp. 32-33)
Manitowoc observed that future legislation may require the use of
refrigerants that, based on their current status, have the potential to
decrease the energy efficiency of ice makers. (Manitowoc, Public
Meeting Transcript, No. 42 at p. 33)
As indicated by AHRI, hydrocarbon refrigerants have not yet been
approved by the EPA SNAP program and hence cannot be considered as a
technology option in DOE's analysis. DOE also notes that, while it is
possible that hydrofluorocarbon (HFC) refrigerants currently used in
automatic commercial ice makers may be restricted by future
legislation, DOE cannot speculate on such future laws and can only
consider in its rulemakings laws that have been enacted. This is
consistent with past DOE rulings, such as in the 2011 direct final rule
for room air conditioners. 76 FR 22454 (April 21, 2011). To the extent
that there has been experience within the industry, domestically or
internationally, with the use of alternative low-GWP refrigerants, DOE
requests any available information, specifically cost and efficiency
information relating to use of alternative refrigerants. DOE
acknowledges that there are government-wide efforts to reduce emissions
of HFCs, and such actions are being pursued both through international
diplomacy as well as domestic actions. DOE, in concert with other
relevant agencies, will continue to work with industry and other
stakeholders to identify safer and more sustainable alternatives to
HFCs while evaluating energy efficiency standards for this equipment.
C. Screening Analysis
In the technology assessment section of this NOPR, DOE presents an
initial
[[Page 14869]]
list of technologies that can improve the energy efficiency of
automatic commercial ice makers. The purpose of the screening analysis
is to evaluate the technologies that improve equipment efficiency to
determine which of these technologies is suitable for further
consideration in its analyses. To do this, DOE uses four screening
criteria--design options will be removed from consideration if they are
not technologically feasible; are not practicable to manufacture,
install, or service; have adverse impacts on product utility or product
availability; or have adverse impacts on health or safety. 10 CFR part
430, subpart C, appendix A, sections (4)(a)(4) and (5)(b) See chapter 4
of the NOPR TSD for further discussion of the screening analysis.
Additional screening criteria include whether a design option is
expected to save energy or whether savings can be measured (using the
prescribed test procedure), and whether an option is a proprietary
technology or whether it is widely available to all manufacturers.
Table IV.6 shows the EPCA criteria and additional criteria used in this
screening analysis, and the design options evaluated using the
screening criteria.
In the NOPR phase, DOE made several changes to the treatment of
design options from the preliminary analysis approach. These changes
included:
Adding a design option to allow for growth of the unit to
increase the size of the condenser and/or evaporator;
Adjusting assumptions regarding maximum compressor EER
levels based on additional research and confidential input from
manufacturers;
Adjusting potable water consumption rates for batch type
ice makers subject to a floor that represents the lowest potable water
consumption rate that would be expected to flush out dissolved solid
reliably;
Adding a design option to allow condenser growth in water-
cooled condensers; and
Adding a drain water heat exchanger design option.
[GRAPHIC] [TIFF OMITTED] TP17MR14.001
[[Page 14870]]
Table IV.7 contains the list of technologies that remained after
the screening analysis.
Table IV.7--Technology Options for Automatic Commercial Ice Makers That Were Screened In
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Technology options Batch ice ConNotesus
makers ice makers
----------------------------------------------------------------------------------------------------------------
Compressor.................... Improved compressor [radic] [radic]
efficiency.
Condenser..................... Increased surface area [radic] [radic]
Increased air flow.... [radic] [radic] Air-cooled only.
Increased water flow.. [radic] [radic] Water-cooled only.
Fans and Fan Motors........... Higher efficiency [radic] [radic] Air-cooled only.
condenser fans and
fan motors.
Other Motors.................. Improved auger motor ............... [radic]
efficiency.
Improved pump motor [radic]
efficiency.
Evaporator.................... Larger evaporator [radic] [radic]
surface area.
Potable Water................. Reduced potable water [radic]
flow.
Drain water thermal [radic]
exchange.
----------------------------------------------------------------------------------------------------------------
a. Tube Evaporator Design
Among the technologies that DOE considered were tube evaporators
that use a vertical shell and tube configuration in which refrigerant
evaporates on the outer surfaces of the tubes inside the shell, and the
freezing water flows vertically inside the tubes to create long ice
tubes that are cut into smaller pieces during the harvest process. Some
of the largest automatic commercial ice makers in the RCU-NRC-Large-B
and the IMH-W-Large-B equipment classes use this technology. However,
DOE concluded that implementation of this technology for smaller
capacity ice makers would significantly impact equipment utility, due
to the greater weight and size of these designs, and to the altered ice
shape. DOE noted that available tube icemakers (for capacities around
1,500 lb ice/24 hours and 2,200 lb ice/24 hours) were 150 to 200
percent heavier than comparable cube ice makers. Based on the impacts
to utility of this technology, DOE screened out tube evaporators from
consideration in this analysis.
b. Low Thermal Mass Evaporator Design
DOE's preliminary analysis did not consider low thermal mass
evaporator designs. Reducing evaporator thermal mass of batch type ice
makers reduces the heat that must be removed from the evaporator after
the harvest cycle, and thus decreases refrigeration system energy use.
DOE indicated during the preliminary analysis that it was concerned
about the potential proprietary status of such evaporator designs,
since DOE is aware of only one manufacturer that produces equipment
with such evaporators. DOE requested comment on the proprietary status
of low-thermal-mass evaporator designs in general, and the design used
by the cited manufacturer (Hoshizaki) in particular.
Scotsman commented that Hoshizaki has recently patented or
attempted to patent modifications to improve evaporator efficiency and
noted that using such evaporator designs would be difficult for other
manufacturers because it would require an expensive and risky redesign
of entire product lines. (Scotsman, Public Meeting Transcript, No. 42
at pp. 35-36; Scotsman, No. 46 at pp. 2-3) However, Manitowoc observed
that, although intellectual property is certainly a concern, there may
be ways to implement this low thermal mass evaporator technology
without exactly duplicating Hoshizaki's designs. (Manitowoc, Public
Meeting Transcript, No. 42 at p. 36)
Hoshizaki commented that its batch type evaporators do indeed
contain intellectual property in past and future designs, adding that
the tooling costs for manufacturing these evaporators would be too
expensive for competing manufacturers to replicate. (Hoshizaki, No. 53
at p. 2)
AHRI recommended that DOE eliminate proprietary designs from
consideration and limit its analysis to technologies that are available
to all manufacturers in the ice maker industry. (AHRI, No. 49 at p. 4)
Manitowoc commented that, in addition to the obvious legal issues
associated with favoring a proprietary design held by a single
manufacturer, DOE's analysis tools are also incapable of predicting the
potential benefit of low thermal mass evaporators, which are difficult
to model accurately. (Manitowoc, Public Meeting Transcript, No. 42 at
pp. 36-37 and No. 54 at p. 3) Manitowoc also warned that the impact of
this technology on one ice maker should not simply be extrapolated to
other machines and that oversimplification of this analysis would
affect the predicted efficiency benefits of each technology level.
(Manitowoc, Public Meeting Transcript, No. 42 at pp. 36-37) Manitowoc
added that customers are very loyal to the style of ice that they get
from its machines and that all manufacturers keep customer loyalty in
mind when designing their evaporators. Consequently, Manitowoc
expressed concern that a new evaporator design could force
manufacturers to change the style of their ice, which could drive down
sales and result in a low overall payback despite the improved energy
performance, and therefore Manitowoc concluded that DOE should not
establish higher efficiency levels based on this design option.
(Manitowoc, Public Meeting Transcript, No. 42 at pp. 36-37 and No. 54
at p. 3)
On the basis of its proprietary status, DOE concludes that its
initial decision to screen out low-thermal-mass evaporator technology
was appropriate. Thus, DOE has screened out this technology in its NOPR
analysis.
c. Drain Water Heat Exchanger
Batch ice makers can benefit from drain water thermal exchange that
cools the potable water supply entering the sump, thereby reducing the
energy required to cool down and freeze the water. Technological
feasibility is demonstrated by one commercially available drain water
thermal heat exchanger that is currently sold only for aftermarket
installation. This product is designed to be installed externally to
the
[[Page 14871]]
ice maker, and both drain water and supply water are piped through the
device.\30\
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\30\ A.J. Antunes and Co. Vizion Product Catalog. (Last accessed
May 18, 2013.) <www.ajantunes.com/VIZION/VIZIONProductCatalog/tabid/229/ProdID/481/CatID/280/language/en-US/Default.aspx>
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In the preliminary analysis, DOE considered whether such a
component could be considered to be part of an ice maker as defined in
EPCA. The EPCA definition for automatic commercial ice makers states
that the ice maker consists of a condensing unit and ice-making section
operating as an integral unit, with means for making and harvesting
ice. (42 U.S.C. 6311(19)) The definition allows that the ice maker may
include means for storing ice, dispensing ice, or storing and
dispensing ice. None of the subcomponents of the ice maker listed in
the definition could be interpreted as referring to heat exchangers for
drain water thermal exchange. DOE notes that an ice maker can still
make ice without a drain water heat exchanger; hence, the drain water
heat exchanger cannot be considered an integral part of the equipment.
For these reasons, DOE concluded during the preliminary analysis that
external drain water heat exchangers, the only configuration of this
technology for which technological feasibility is demonstrated, should
be screened out, and requested comments on this approach.
NPCC asserted that DOE should consider drain water thermal exchange
as a technology option. NPCC proposed that reducing the inlet water
temperature could enable an ice maker to maintain the same capacity
without increasing the overall size of the unit. Although NPCC does not
manufacture ice makers, it acknowledged having seen this technology
implemented in other applications, such as water heating, without
reducing capacity or increasing overall size. (NPCC, Public Meeting
Transcript, No. 42 at pp. 37-38)
Earthjustice commented that DOE's rationale for screening out drain
water thermal heat exchangers was defective on both legal and factual
grounds. In the preliminary analysis TSD, DOE suggested that externally
mounted drain water heat exchangers would fall outside EPCA's
definition of automatic commercial ice makers, and that DOE therefore
had no authority to consider them in this rulemaking. Earthjustice
argued that this reading twists the statutory definition's role in
identifying which products constitute the ``automatic commercial ice
makers'' subject to efficiency standards into a ``Dos and Don'ts'' list
from Congress as to which elements of ice makers DOE may examine when
amending the standards that Congress enacted. Congress adopted
standards that apply to the ice maker as a whole, and Earthjustice
asserted that there is therefore no basis to conclude that EPCA
intended to prohibit DOE from looking holistically at this equipment
when amending the statutory standards. Earthjustice added that, if
every technological innovation that improved the efficiency of a
covered product needed to be specifically mentioned in the statute's
definition of the product, there would be no need for a screening
analysis. Earthjustice also noted that, in previous rulemakings, DOE
consistently recognized that components that improve the efficiency of
covered products merit consideration in the DOE's analyses,
notwithstanding that they may be unnecessary to the basic function
performed by the product, not referred to in the statutory definition
applicable to the product, or external to the case or envelope of the
device. Finally, Earthjustice commented that DOE's assertion that
internally mounted drain heat exchangers would necessarily increase
cabinet size is not true for all ice maker models. Moreover,
Earthjustice stated, DOE has not considered options such as
microchannel heat exchangers, which would increase both machine
efficiency as well as available cabinet space within the ice maker.
(Earthjustice, No. 47 at pp. 1-4)
DOE has reconsidered its preliminary suggestion that external drain
water heat exchangers cannot be considered part of an ice maker simply
because they are not specifically mentioned in the EPCA definition, now
concluding that they can be considered as a design option and to be
part of a basic model ice maker, assuming that the drain water heat
exchanger is sold and shipped with the unit and that the installation
and operating instructions clearly reinforce this inclusion by
detailing the installation requirements for the heat exchanger.
Thus, DOE is including this technology as a design option. As NPCC
noted, externally mounted drain water heat exchangers would provide
energy savings by using ``waste'' water to cool the incoming potable
water supply, thus reducing the amount of energy necessary to freeze
the water into ice. Whereas internal heat exchangers may require
increased cabinet size to fit within the ice maker, allowing external
heat exchangers as a design option would prevent size increase.
DOE has concluded that drain water heat exchangers, both internally
mounted and externally mounted, are design options that can increase
the energy efficiency of automatic commercial ice makers. The current
test procedures would give manufacturers credit for efficiency
improvement of drain water heat exchangers, including externally
mounted drain water heat exchangers as long as they are provided with
the machine and the installation instructions for the machine indicate
that the heat exchangers are part of the machine and must be installed
as part of the overall installation.
d. Design Options That Necessitate Increased Cabinet Size
Some of the design options considered by DOE in its technology
assessment could require an increased cabinet size. Examples of such
design options include increasing the surface area of the evaporator or
condenser, or both. Larger heat exchangers would enable the refrigerant
circuit to operate with an increased evaporating temperature and a
decreased condensing temperature, thus reducing the temperature lift
imposed on the refrigeration system and hence the compressor power
input. In some cases the added refrigerant charge associated with
increasing heat exchanger size could also necessitate the installation
of a refrigerant receiver to ensure proper refrigerant charge
management in all operating conditions for which the unit is designed,
thus increasing the need for larger cabinet size.
In the preliminary analysis, DOE did not consider design options
that increase cabinet size, and it requested comment on this approach.
(DOE, Public Meeting Presentation, No. 29 at p. 35)
Earthjustice observed that this issue, in which certain design
options necessitate larger products and therefore larger installation
costs, is common in rulemakings. Despite the potential difficulties
that increased size could pose for ice maker manufacturers and
customers, Earthjustice commented that the preliminary analysis is not
necessarily the stage of the rulemaking in which such design options
should be ruled out. (Earthjustice, Public Meeting Transcript, No. 42
at pp. 46-47)
At the February 2012 preliminary analysis public meeting, Manitowoc
pointed out that the size of ice makers is severely limited in certain
applications, which would make it difficult for manufacturers to
implement design changes that reduce energy but require an increase in
size. Manitowoc warned that DOE should not assume that all ice maker
manufacturers can increase the sizes of their ice machines to meet
standards. In many cases,
[[Page 14872]]
according to Manitowoc, increasing the size may result in higher
installation costs, which are not considered in DOE's analysis.
Manitowoc and AHRI both noted that a high percentage of the ice machine
business involves replacing old units and that the size of new ice
makers is therefore dictated by the size of the products being
replaced. (Manitowoc, Public Meeting Transcript, No. 42 at pp. 57-59
and No. 54 at p. 2; AHRI, No. 49 at p. 2) AHRI also commented that
customers continue to demand smaller ice machines as the space used to
house them competes against more ``usable'' spaces, such as hotel
rooms. Hoshizaki agreed that the industry was moving toward smaller ice
makers and also recommended that DOE limit cabinet size. Consequently,
Manitowoc, AHRI, and Hoshizaki all commented that DOE should not
consider design options that increase cabinet size in its analysis.
(Manitowoc, No. 54 at p. 2; AHRI, No. 49 at p. 2; Hoshizaki, No. 53 at
p. 1)
Scotsman commented that, for products at the top of the capacity
range within a given standard cabinet size, manufacturers cannot
increase the size of internal components such as air-cooled condensers
without increasing the machines' cabinet size. This would make the
machines less competitive because they would no longer physically fit
in certain applications, according to Scotsman. (Scotsman, Public
Meeting Transcript, No. 42 at pp. 87-88) Moreover, Scotsman noted that
assessing the impact of a technology on one type of machine and
applying it to other types can be difficult and inaccurate. For
example, while increasing condenser area could be simple for a 300-lb
machine, it may require retooling several parts, in addition to
increasing cabinet size and thus also increasing overall costs, to make
the same condenser growth fit in a 600-lb machine. (Scotsman, No. 46 at
p. 2) Finally, Scotsman stated that increasing the size of ice makers
will cause cabinet costs to increase. (Scotsman, Public Meeting
Transcript, No. 42 at p. 64) Therefore, Scotsman agreed with its fellow
manufacturers that DOE should avoid design options requiring cabinet
size increases. (Scotsman, No. 46 at p. 4)
Manitowoc commented that it is rare for manufacturers to have data
regarding available space, ventilation, or other variables regarding
the final installation of their products. Moreover, Manitowoc added
that forcing an ice maker with larger cabinet size into an existing
space that is too small for it would exacerbate condenser air
recirculation, which decreases its efficiency and reliability.
(Manitowoc, Public Meeting Transcript, No. 42 at pp. 62-63)
However, Scotsman also commented that an ice maker's energy use
typically decreases as its size increases, meaning that it may be more
efficient to use an oversized machine than one that has been downsized.
(Scotsman, Public Meeting Transcript, No. 42 at pp. 61-62)
Howe commented that the physical size of an automatic commercial
ice maker has no effect on its efficiency or its run time. According to
Howe, the run time of ice makers is a function of their productive
capacity as well as the size of their ice storage bins, because ice
production automatically ceases when the bin is full. Howe added that
regulating the physical size of ice makers may limit the use of new,
more efficient technologies in the future. Therefore, Howe urged DOE
not to consider limiting the physical size of ice makers. (Howe, No. 51
at pp. 1-2)
NEEA/NPCC also urged DOE not to consider limiting ice maker cabinet
size in the rulemaking. NEEA/NPCC pointed out that, although improving
the efficiency of an ice maker may require increasing the size of its
components, many ice makers have sufficient room in their cabinets to
accommodate such size increases. According to NEEA/NPCC, advanced
evaporator designs could be used to meet efficiency and capacity
requirements for ice makers whose evaporators already require the full
cabinet size. (NEEA/NPCC, No. 50 at p. 2)
CA IOUs agreed that DOE should not screen out design options that
would require an increase in cabinet size. CA IOUs referred to a
limited field study whose results indicated to CA IOUs that larger ice-
making equipment may be accommodated in most situations. CA IOUs added
that there is no evidence as to whether there may be another space in
installation locations that could accommodate a larger ice maker.
Therefore, CA IOUs asserted that, in the absence of a survey or field
study that shows size constraints to be an issue, DOE should not use
size to screen out design options. (CA IOUs, No. 56 at p. 3)
Based on these comments from stakeholders, DOE understands that
automatic commercial ice makers are often used in applications where
space is very limited. DOE has not received any data supporting or
refuting the characterization that installation locations may be able
to accommodate larger icemakers.
Although CA IOUs cited a study indicating that installation
locations may be able to accommodate larger ice makers,\31\ the sample
size of this study is extremely small and is not necessarily
representative of the entire automatic commercial ice maker market. The
study does not present any findings on the size constraints and
allowances seen in the inspected products, and the pictures themselves
are inconclusive. DOE believes it would be difficult to support any
size-based conclusions using this study.
---------------------------------------------------------------------------
\31\ Karas, A. A Field Study to Characterize Water And Energy
Use of Commercial Ice-Cube Machines and Quantify Savings Potential.
December 2007. Fisher-Nickel, Inc., San Ramon, CA.
<www.fishnick.com/publications/fieldstudies/Ice_Machine_Field_Study.pdf>
---------------------------------------------------------------------------
Particularly because replacements comprise such a large portion of
the ice maker industry, ice makers affected by the proposed standard
must maintain traditional standard widths and depths. Allowing design
options that necessitate physical size increases may push certain
capacity units beyond their current standard dimensions and would thus
force the use of lower-capacity machines in replacement applications,
which would significantly reduce equipment utility.
On the other hand, screening out size-increasing design options
would eliminate from consideration technologies that could
significantly reduce the energy consumption of automatic commercial ice
makers.
Consideration of design options that increase the size of ice
makers is strongly related to consideration of size-constrained design
options. DOE notes that, while stakeholders have pointed out that many
automatic ice maker applications are space-constrained, as described in
section IV.B.1.a, DOE does not have access to sufficiently-detailed
data that would either indicate what percentage of applications could
not allow size increase, or be the basis to set size limits for space-
constrained classes. Thus, DOE has also decided not to create size-
constrained equipment classes.
DOE also notes that there are a wide range of product sizes within
most equipment classes, and that DOE must seek out the most-efficient
configurations. DOE noted that the equipment it purchased for reverse
engineering inspections reflected a general trend that more-efficient
units were often larger, had larger condensers, and in some cases had
larger evaporators. Based on DOE's market study and equipment
inspections, larger chassis sizes appeared often to be a means of
achieving higher efficiencies.
Thus, DOE is including this package-size-increasing technologies as
design options in the NOPR analysis. DOE only
[[Page 14873]]
applied these design options for those equipment classes where the
representative baseline unit had space to grow relative to the largest
units on the market. The equipment growth allowed for larger heat
exchangers to increase equipment efficiency.
For equipment classes with remote condensers, DOE only applied this
design option to the condenser package, and not to the ice-making head
that is placed indoors. In general, DOE only considered increasing the
size of the evaporator whenever the product inspections (see section
IV.D.4.e) indicated that it was needed to increase efficiency.
In addition, DOE recognizes that space constraints are more
critical for SCU units; hence, DOE did not consider package size growth
for SCU equipment classes.
Table IV.8 indicates for which analyzed equipment classes DOE
considered chassis growing design options.
Table IV.8--Analyzed Equipment Classes Where DOE Analyzed Size-Increasing Design Options
----------------------------------------------------------------------------------------------------------------
Rated harvest rate lb ice/24 Used design options that
Unit hours increased size?
----------------------------------------------------------------------------------------------------------------
IMH-A-Small-B.................................. 300 Yes.
IMH-A-Large-B (med)............................ 800 Yes.
IMH-A-Large-B (large).......................... 1,500 No.
IMH-W-Small-B.................................. 300 Yes.
IMH-W-Med-B.................................... 850 No.
IMH-W-Large-B.................................. 2,600 No.
RCU-XXX-Large-B (med).......................... 1,500 For the remote condenser, but not
for the ice-making head.
RCU-XXX-Large-B (large)........................ 2,400 For the remote condenser, but not
for the ice-making head.
SCU-A-Small-B.................................. 110 No.
SCU-A-Large-B.................................. 200 No.
SCU-W-Large-B.................................. 300 No.
IMH-A-Small-C.................................. 310 No.
IMH-A-Large-C (med)............................ 820 No.
SCU-A-Small-C.................................. 110 No.
----------------------------------------------------------------------------------------------------------------
Table IV.9 shows the size increases that DOE considered in the
analysis. DOE only considered these size increases when a unit existed
on the market that was larger than the baseline unit. DOE based the new
chassis sizes on the sizes of current units on the market.
Table IV.9--Description of Size Increase Design Options in the Engineering Analysis
--------------------------------------------------------------------------------------------------------------------------------------------------------
Volume cubic
Equipment class Equipment type Size descriptor Height inches Width inches Depth inches feet
--------------------------------------------------------------------------------------------------------------------------------------------------------
IMH-A-Small-B................... IMH..................... Baseline.......... 16.5 30 24.5 7.02
Growth............ 21.5 30 24.5 9.14
IMH-A-Large-B (Med)............. IMH..................... Baseline.......... 26 30 24 10.83
Growth............ 29 30 24 12.08
IMH-W-Small-B................... IMH..................... Baseline.......... 20 30 24 8.33
Growth............ 23.5 30 23.5 9.59
--------------------------------------------------------------------------------------------------------------------------------------------------------
Further information on this analysis is available in chapter 5 of
the NOPR TSD.
e. Microchannel Heat Exchangers
NEEA/NPCC, ASAP, and Earthjustice all recommended that DOE include
microchannel heat exchanger technology in its examination of design
options for improving condenser and evaporator efficiency. NEEA/NPCC
noted that this technology has been used in heat exchangers for air
handling equipment for years and it would allow for increased
efficiency or greater ice production capacity. (NEEA/NPCC, No. 50 at p.
2) ASAP commented that, although it is not aware of ice makers on the
market that incorporate microchannel heat exchangers, ice maker
manufacturers who have tested prototype units that implement this
technology have noticed significant efficiency improvements. (ASAP, No.
52 at p. 1) Finally, Earthjustice noted that microchannel heat
exchanger technology would increase both machine efficiency and
available cabinet space within the ice maker. (Earthjustice, No. 47 at
pp. 1-4)
DOE has not found evidence that this technology is cost-effective.
Moreover, through discussions with manufacturers, DOE has learned of no
instances of energy savings associated with the use of microchannel
heat exchangers in ice makers. Manufacturers also noted that the
reduced refrigerant charge associated with microchannel heat exchangers
can be detrimental to the harvest performance of batch type ice makers,
as there is not enough charge to transfer heat to the evaporator from
the condenser.
DOE contacted microchannel manufacturers to determine whether there
were savings associated with use of microchannel heat exchangers in
automatic commercial ice makers. These microchannel manufacturers noted
that investigation of microchannel was driven by space constraints
rather than efficiency.
Because the potential for energy savings is inconclusive, based on
DOE analysis as well as feedback from manufacturers and heat exchanger
suppliers, and based on the potential utility considerations associated
with compromised harvest performance in batch type ice makers
associated with this heat exchanger technology's reduced refrigerant
charge, DOE
[[Page 14874]]
screened out microchannel heat exchangers as a design option in this
rulemaking.
f. Smart Technologies
CA IOUs recommended that DOE also consider including ``smart''
technologies as design options that will go beyond simple energy
savings by capturing demand reductions as well. To support this
proposition, CA IOUs referenced a study showing that, for automatic
commercial ice-making equipment, there are 450 megawatts of demand
reduction potential in California alone, indicating a significant
nationwide possibility for reducing the energy demand associated with
ice makers. If DOE does not include ``smart'' technologies as design
options, CA IOUs instead asked that DOE comment on whether states will
be allowed to implement such design option requirements for ice-making
equipment. (CA IOUs, No. 56 at pp. 5-6)
While there may be energy demand benefits associated with use of
``smart technologies'' in ice makers in that they reduce energy demand
(e.g., shift the refrigeration system operation to a time of utility
lower demand), DOE is not aware of any commercialized products or
prototypes that also demonstrate improved energy efficiency in
automatic commercial ice makers. Demand savings alone do not impact
energy efficiency, and DOE cannot consider technologies that do not
offer energy savings as measured by the test procedure. Since the scope
of this rulemaking is to consider energy conservation standards that
increase the energy efficiency of automatic commercial ice makers, not
how they operate, for example, in relation to utility demand, this
technology option has been screened out because it does not save energy
as measured by the test procedure.
g. Screening Analysis: General Comments
Howe suggested that DOE gather information on a wider variety of
design types of both batch and continuous type ice makers before
completing its analyses, noting that DOE may have prematurely screened
out design options simply because they had adverse effects on the ice
makers within the small range of design parameters for which DOE
collected data. (Howe, No. 51 at p. 4)
Howe has not provided specific examples of technologies that it has
claimed that DOE prematurely screened out, so DOE is not in a position
to respond. During the NOPR analysis, DOE analyzed additional units and
accounted for this additional data in its engineering analysis. DOE
considered a wide range of design types for ice makers, and screened
out technologies as described in section IV.D.
D. Engineering Analysis
The engineering analysis determines the manufacturing costs of
achieving increased efficiency or decreased energy consumption. DOE
historically has used the following three methodologies to generate the
manufacturing costs needed for its engineering analyses: (1) The
design-option approach, which provides the incremental costs of adding
to a baseline model design options that will improve its efficiency;
(2) the efficiency level approach, which provides the relative costs of
achieving increases in energy efficiency levels, without regard to the
particular design options used to achieve such increases; and (3) the
cost-assessment (or reverse engineering) approach, which provides
``bottom-up'' manufacturing cost assessments for achieving various
levels of increased efficiency, based on detailed data as to costs for
parts and material, labor, shipping/packaging, and investment for
models that operate at particular efficiency levels.
As discussed in the Framework document and preliminary analysis,
DOE conducted the engineering analyses for this rulemaking using a
combined efficiency level/design option/reverse engineering approach to
developing cost-efficiency curves for automatic commercial ice makers.
DOE established efficiency levels defined as percent energy use lower
than that of baseline efficiency products. DOE's analysis is based on
the efficiency improvements associated with groups of design options.
Also, DOE developed manufacturing cost models based on reverse
engineering of products to develop a baseline manufacturer production
cost (MPC) and to support calculation of the incremental costs
associated with improvement of efficiency.
DOE selected a set of 25 equipment classes to analyze directly in
the engineering analysis. To develop the analytically derived cost-
efficiency curves, DOE collected information from various sources on
the manufacturing cost and energy use reduction characteristics of each
of the design options. DOE reviewed product literature, tested and
conducted reverse engineering of 39 ice makers, and interviewed
component vendors of compressors and fan motors. DOE also conducted
interviews with manufacturers during the preliminary analysis.
Additional details of the engineering analysis are available in chapter
5 of the NOPR TSD and a copy of the engineering questionnaire is
reproduced in appendix 12A of the NOPR TSD.
Cost information from the vendor interviews and discussions with
manufacturers provided input to the manufacturing cost model. DOE
determined incremental costs associated with specific design options
from both vendor information and the cost model. DOE modeled energy use
reduction using the FREEZE program, which was developed in the 1990s
and upgraded as part of the preliminary analysis. The reverse
engineering, vendor interviews, and manufacturer interviews provided
input for the energy analysis. The final incremental cost estimates and
the energy modeling results together constitute the energy efficiency
curves presented in the NOPR TSD chapter 5.
DOE also considered conducting the engineering analysis using an
efficiency level approach based on rated and/or measured energy use and
manufacturing cost estimates based on reverse engineering data. DOE
completed efficiency level analyses for several equipment classes but
concluded that this approach was not viable, because the analysis
suggested that cost would be reduced for higher efficiency designs for
several of the equipment classes. This analysis is discussed in section
IV.D.4.e and in chapter 5 of the NOPR TSD.
1. Representative Equipment for Analysis
In performing its engineering analysis, DOE selected representative
units for 12 equipment class to serve as analysis points in the
development of cost-efficiency curves. In selecting these units, DOE
selected models that were generally representative of the typical
offerings produced within the given equipment class. DOE sought to
select models having features and technologies typically found in the
minimum efficiency equipment currently available on the market, but
selected some models having features and technologies typically found
in the highest efficiency equipment currently available on the market.
2. Efficiency Levels
a. Baseline Efficiency Levels
EPCA, as amended by the EPACT 2005, prescribed the following
standards for batch type ice makers, shown in Table IV.10, effective
January 1, 2010. (42 U.S.C. 6313(d)(1)) For the engineering analysis,
DOE used the existing batch type equipment standards as the baseline
efficiency level for the
[[Page 14875]]
equipment types under consideration in this rulemaking. Also, DOE
applied the standards for equipment with harvest capacities up to 2,500
lb ice/24 hours as baseline efficiency levels for the larger batch type
equipment with harvest capacities between 2,500 and 4,000 lb ice/24
hours, which are currently not regulated. DOE applied two exceptions to
this approach, as discussed below.
For the IMH-W-Small-B equipment class, DOE slightly adjusted the
baseline energy use level to close a gap between the IMH-W-Small-B and
the IMH-W-Medium-B equipment classes. For equipment in the IMH-A-Large-
B equipment class with harvest capacity above 2,500 lb ice per 24
hours, DOE chose a baseline efficiency level equal to the current
standard level at the 2,500 lb ice per 24 hours capacity. In its
analysis, DOE is treating the constant portion of the IMH-A-Large-B
equipment class as a separate equipment class, IMH-A-Extended-B.
Section IV.C contains more details of these adjustments.
DOE is not proposing adjustment of maximum condenser water use
standards for batch type ice makers. First, DOE's authority does not
extend to regulation of water use, except as explicitly provided by
EPCA. Second, DOE determined that increasing condenser water use
standards to allow for more water flow in order to reduce energy use is
not cost-effective. The details of this analysis are available in
chapter 5 of the NOPR TSD.
For water-cooled batch equipment with harvest capacity less than
2,500 lb ice per 24 hours, the baseline condenser water use is equal to
the current condenser water use standards for this equipment.
For water-cooled equipment with harvest capacity greater than 2,500
lb ice per 24 hours, DOE proposes to set maximum condenser water
standards equal to the current standard level for the same type of
equipment with a harvest capacity of 2,500 lb ice per 24 hours--the
proposed standard level would not continue to drop as harvest capacity
increases, as it does for equipment with harvest capacity less than
2,500 lb ice per 24 hours.
Table IV.10--Baseline Efficiency Levels for Batch Ice Makers
----------------------------------------------------------------------------------------------------------------
Maximum condenser
Equipment type Type of cooling Rated harvest rate Maximum energy use water use * gal/
lb ice/24 hours kWh/100 lb ice 100 lb ice
----------------------------------------------------------------------------------------------------------------
Ice-Making Head................. Water............ <500.............. 7.79-0.0055H ** 200-0.022H.
[dagger].
>=500 and <1,436.. 5.58-0.0011H....... 200-0.022H.
>=1,436........... 4.0................ 145.
Air.............. <450.............. 10.26-0.0086H...... Not Applicable.
>=450 and <2,500.. 6.89-0.0011H....... Not Applicable.
>=2,500........... 4.1................ Not Applicable.
Remote Condensing (but not Air.............. <1,000............ 8.85-0.0038H....... Not Applicable.
remote compressor). >=1,000........... 5.10............... Not Applicable.
Remote Condensing and Remote Air.............. <934.............. 8.85-0.0038H....... Not Applicable.
Compressor. >=934............. 5.30............... Not Applicable.
Self-Contained.................. Water............ <200.............. 11.4-0.019H........ 191-0.0.
>=200............. 7.60............... For <2,500: 191-
0.0315H For
>=2,500: 112.
Air.............. <175.............. 18.0-0.0469H....... Not Applicable.
>=175............. 9.80............... Not Applicable.
----------------------------------------------------------------------------------------------------------------
* Water use is for the condenser only and does not include potable water used to make ice.
** H = rated harvest rate in pounds per 24 hours, indicating the water or energy use for a given rated harvest
rate. Source: 42 U.S.C. 6313(d).
[dagger] There is a gap between the existing IMH-W-Small-B standard and the IMH-W-Medium-B standard. The
baseline equation for the IMH-W-Small-B equipment class was adjusted from 7.8--0.0055*H to 7.79--0.0055*H to
close this gap.
Currently there are no DOE energy standards for continuous type ice
makers. During the preliminary analysis, DOE developed baseline
efficiency levels using energy use data available from several sources,
as discussed in chapter 3 of the preliminary TSD. DOE chose baseline
efficiency levels that would be met by nearly all ice makers
represented in the databases. Also, because energy use reported at the
time DOE was preparing the preliminary analysis did not include the
hardness adjustment prescribed by the new test procedure,\32\ DOE made
these adjustments to the data. At that time, hardness data was also not
generally available for ice makers; therefore, DOE used assumptions of
0.7 ice hardness for flake ice makers and 0.85 for nugget ice makers to
make the hardness adjustments, thus estimating energy use as it would
be measured by the new test procedure. 77 FR 3404 (Jan. 24, 2012). DOE
selected harvest capacity break points (harvest capacities at which the
slopes of the trial baseline efficiency levels change) for all but the
self-contained equipment classes consistent with those selected by the
Consortium for Energy Efficiency (CEE) for their new Tier 2 efficiency
level for flake ice makers. Note that DOE did not also adopt the CEE
energy use levels for any of its incremental efficiency levels because
the CEE energy use levels do not incorporate adjustment of the measured
energy use based on ice hardness.
---------------------------------------------------------------------------
\32\ Ice hardness is a term used for ice produced by continuous
type ice makers, describing what percentage of the output is hard
ice (as compared to water).
---------------------------------------------------------------------------
For the NOPR analysis, DOE used newly available information
published in the AHRI Directory of Certified Product Performance, the
California Energy Commission, the ENERGY STAR program, and vendor Web
sites, to update its icemaker ratings database (``DOE icemaker ratings
database''). In 2012, AHRI published equipment ratings for many
continuous type ice makers, including ice hardness factors calculated
as prescribed by ASHRAE 29-2009, which is incorporated by reference in
the new DOE test procedure. DOE recreated its database for continuous
type ice makers based on the available AHRI data, considering only the
ice makers for which AHRI ratings for ice hardness were available. DOE
also adjusted the harvest capacity break points for the continuous
equipment classes based on the new data.
The baseline efficiency levels for continuous type ice makers are
presented in Table IV.11. They are
[[Page 14876]]
compared with the ice maker energy use data in chapter 3 of the NOPR
TSD. For the remote condensing equipment, the large-capacity remote
compressor and large-capacity non-remote compressor classes have been
separated and are different by 0.2 kWh/100 lb, identical to the batch
equipment differential. This differential is also discussed briefly in
section IV.B.1.e. DOE requests comments on the development of
efficiency levels for continuous type ice makers and whether the
selected levels appropriately represent baseline equipment.
Table IV.11--Baseline Efficiency Levels for Continuous Ice Maker Equipment Classes
----------------------------------------------------------------------------------------------------------------
Maximum condenser
Equipment type Type of cooling Rated harvest rate Maximum energy use water use * gal/
lb ice/24 hours kWh/100 lb ice * 100 lb ice
----------------------------------------------------------------------------------------------------------------
Ice-Making Head................. Water............ Small (<900)....... 8.1-0.00333H...... 160-0.0176H.
Large (>=900)...... 5.1............... <=2,500: 160-
0.0176H; >2,500:
116.
Air.............. Small (<700)....... 11.0-0.00629H..... Not Applicable.
Large (>=700)...... 6.6............... Not Applicable.
Remote Condensing (Remote Air.............. Small (<850)....... 10.2-0.00459H..... Not Applicable.
Compressor). Large (>=850)...... 6.3............... Not Applicable.
Remote Condensing (Non-remote Air.............. Small (<850)....... 10.0-0.00459H..... Not Applicable.
Compressor). Large (>=850)...... 6.1............... Not Applicable.
Self-Contained.................. Water............ Small (<900)....... 9.1-0.00333H...... 153-0.0252H.
Large (>=900)...... 6.1............... <=2,500: 153-
0.0252H; >2,500:
90.
Air.............. Small (<700)....... 11.5-0.00629H..... Not Applicable.
Large (>=700)...... 7.1............... Not Applicable.
----------------------------------------------------------------------------------------------------------------
* H = rated harvest rate in lb ice/24 hours.
b. Incremental Efficiency Levels
For each of the nine analyzed batch type ice-making equipment
classes, DOE established a series of incremental efficiency levels for
which it has developed incremental cost data and quantified the cost-
efficiency relationship. DOE chose a set of analyzed equipment classes
that would be representative of all batch type ice-making equipment
classes, and grouped non-analyzed equipment classes with analyzed
equipment classes accordingly in the downstream analysis. Table IV.12
shows the selected incremental efficiency levels.
For the IMH-A-Large-B equipment class, DOE is adopting its
suggested approach from the preliminary analysis meeting. (DOE,
Preliminary Analysis Public Meeting Presentation, No. 42 at p. 29) As
part of this approach, DOE is treating the largest units as an extended
equipment class (IMH-A-Extended-B), basing the analysis for this
equipment class on the analysis for a 1,500 lb ice/24 hour IMH-A-Large-
B unit. When setting TSLs, DOE is considering the 800 lb ice/24 hour
IMH-A-Large-B analysis separately from the 1,500 lb ice/24 hour
analysis.
Table IV.12--Incremental Efficiency Levels for Batch Ice Maker Equipment Classes
----------------------------------------------------------------------------------------------------------------
Rated harvest
Equipment type * rate lb ice/24 EL 2 ** EL 3 (%) EL 4 (%) EL 5 (%) EL 6 (%)
hours
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B................ <500........... 10%................. 15 20 25 .........
IMH-W-Med-B.................. >=500 and 10%................. 15 20 ......... .........
<1,436.
IMH-W-Large-B................ >=1,436........ 10%................. 15 20 ......... .........
IMH-A-Small-B................ <450........... 10% (E-STAR 15 20 25 30
[dagger]).
IMH-A-Large-B [Dagger]....... >=450.......... 10% (E-STAR 15 20 25 .........
[dagger]).
RCU-NRC-Small-B ***.......... <1,000......... 9% (E-STAR [dagger]) 15 20 ......... .........
RCU-NRC-Large-B.............. >=1,000........ 9% (E-STAR [dagger]) 15 20 ......... .........
RCU-RC-B..................... <934........... 9% (E-STAR [dagger]) 15 20 ......... .........
>=934.......... 9% (E-STAR [dagger]) 15 20 ......... .........
SCU-W-Small-B ***............ <200........... 7%.................. 15 20 25 30
SCU-W-Large-B................ >=200.......... 7%.................. 15 20 25 30
SCU-A-Small-B................ <175........... 7% (E-STAR [dagger]) 15 20 25 30
SCU-A-Large-B................ >=175.......... 7% (E-STAR [dagger]) 15 20 25 30
----------------------------------------------------------------------------------------------------------------
* See Table III.1 for a description of these abbreviations.
** EL = efficiency level; EL 1 is the baseline efficiency level, while EL 2 through EL 6 represent increased
efficiency levels.
*** These equipment classes were not directly analyzed.
[dagger] New ENERGY STAR levels became effective on February 1, 2013. These levels represent the ENERGY STAR
levels prior to February 1, 2013.
[Dagger] The IMH-A-Large-B levels were analyzed at the 800 lb ice/24 hour size and the 1,500 lb ice/24 hour
size, and the 1,500 lb ice/24 hour size were used to set standards for the new IMH-A-Extended-B class.
For each of the three analyzed continuous type ice maker equipment
classes, DOE established a series of incremental efficiency levels, for
which it has developed incremental cost data and quantified the cost-
efficiency relationship. DOE chose a set of analyzed equipment classes
that would be representative of all continuous type ice-making
equipment classes, and grouped non-analyzed equipment classes with
analyzed equipment classes accordingly in the downstream analysis, as
discussed in section V.A.1. Table IV.13 shows the selected incremental
efficiency levels. The efficiency levels are defined by the percent
energy use less than the baseline energy use.
[[Page 14877]]
Table IV.13--Selected Incremental Efficiency Levels for Continuous Type Ice Maker Equipment Classes
--------------------------------------------------------------------------------------------------------------------------------------------------------
Rated harvest
Equipment type * rate lb ice/24 EL 2 ** (%) EL 3 (%) EL 4 (%) EL 5 (%) EL 6 (%)
hours
--------------------------------------------------------------------------------------------------------------------------------------------------------
IMH-W-Small-C........................................... <900 .............. .............. .............. .............. ..............
IMH-W-Large-C........................................... >=900 .............. .............. .............. .............. ..............
IMH-A-Small-C........................................... <700 10 15 20 25 30
IMH-A-Large-C........................................... >=700 10 15 20 25 30
-------------------------------------------------------------------------------
RCU-Small-C............................................. <850 Not Analyzed.
RCU-Large-C............................................. >=850 Not Analyzed.
SCU-W-Small-C........................................... <900 Not Analyzed.
SCU-W-Large-C........................................... >=900 No existing products on the market.
-------------------------------------------------------------------------------
SCU-A-Small-C........................................... <700 7 15 20 25 ..............
-------------------------------------------------------------------------------
SCU-A-Large-C........................................... >=700 No existing products on the market.
--------------------------------------------------------------------------------------------------------------------------------------------------------
* See Table III.1 for a description of these abbreviations.
** EL 1 is the baseline efficiency level, while EL 2 through EL 6 represent increased efficiency levels.
DOE selected the efficiency levels for the continuous type ice
makers based on the levels proposed in the preliminary analysis.
c. IMH-A-Large-B Treatment
The current DOE energy conservation standard for large air-cooled
IMH cube type ice makers is represented by an equation for which
maximum allowable energy usage decreases linearly as harvest rate
increases from 450 to 2,500 lb ice/24 hours. Extending the current IMH-
A-Large-B equation to the 4,000 lb ice/24 hours range would result in
efficiency levels in the newly covered range (between 2,500 lb/day and
4,000 lb/day) that may not be technically feasible. For example, at
4,000 lb ice/24 hours, the specified baseline energy use would be 2.49
kWh/100 lb, a value far below the energy consumption of existing IMH-A-
Large-B ice makers (e.g., it is 39 percent lower than the lowest rating
for IMH-A-Large-B equipment of which DOE is aware, 4.1 kWh/100 lb). In
the preliminary analysis, DOE proposed establishing baseline and
incremental efficiency levels for this equipment class that maintain a
constant level of energy use at higher harvest capacities, with
exceptions in certain harvest capacity ranges to avoid backsliding. For
example, for efficiency level 2, DOE proposed that (a) between 1,600
and 2,080 lb ice/24 hours, the maximum energy use would be independent
of harvest capacity, as is the case for all other high-harvest-capacity
equipment classes, (b) between 2,080 lb ice/24 hours, the maximum
energy usage would be calculated according to the current standard to
avoid EPCA anti-backsliding provisions, and (c) between 2,500 and 4,000
lb ice/24 hours, the maximum energy use would remain constant. DOE
presented this approach in the preliminary analysis and requested
comment on it; DOE did not receive any comments on this approach.
Hence, DOE is proposing to use the approach it outlined in the
preliminary analysis meeting for the IMH-A-Large-B equipment class
(DOE, Preliminary Analysis Public Meeting Presentation, No. at p. 29).
Further, DOE proposes to separate capacity ranges of this class into
ranges designated IMH-A-B and IMH-A-Extended-B, the first for equipment
with harvest capacity less than 1,500 lb ice/24 hours and the second
with greater harvest capacity. The proposed IMH-A-B efficiency levels
would be constant between 800 and 1,500 lb ice/24 hours. Each proposed
IMH-A-Extended-B efficiency level would start at an energy use that is
equal to that of one of IMH-A-B efficiency levels. Its energy use would
remain constant at this level within its lower range of harvest
capacity rates, but would follow the current DOE standard between the
harvest capacity for which the constant level equals the current DOE
standard and 2,500 lb ice/24 hours. Beyond 2,500 lb ice/24 hours, it
would remain constant from 2,500 to 4,000 lb ice/24 hours.
d. Maximum Available Efficiency Equipment
For the NOPR analysis, DOE considered the most-efficient equipment
available on the market, known as maximum available equipment. In some
cases, the maximum available equipment uses technology options that DOE
chose to screen out for its analysis. Hence, DOE also identified
maximum available equipment without screened technologies (see the
discussion of the engineering analysis in section IV.D.2.f). The
technologies that are used in some maximum available equipment that
were screened out include low thermal-mass evaporators and tube
evaporators for batch type ice makers.
Efficiency levels for maximum available equipment in the batch type
ice-making equipment classes are tabulated in Table V.16. This
information is based on DOE's icemaker ratings database (also see data
in chapter 3 of the NOPR TSD). The efficiency levels are represented as
an energy use percentage reduction compared to the energy use of
baseline-efficiency equipment, the selection of which is discussed in
section IV.D.2.a.
Table IV.14--Efficiency Levels for Maximum Available Equipment in Batch
Ice Maker Equipment Classes
------------------------------------------------------------------------
Equipment class Energy use lower than baseline
------------------------------------------------------------------------
IMH-W-Small-B.......................... 24.5%.
IMH-W-Med-B............................ 22.4%.
IMH-W-Large-B.......................... 7.5% (at 1,500 lb ice/24
hours).
8.3% (at 2,600 lb ice/24
hours).
IMH-A-Small-B.......................... 23.6%.
IMH-A-Large-B.......................... 20.7% (at 800 lb ice/24 hours).
21.3% (at 1,500 lb ice/24
hours).
RCU-Small-B............................ 24.6%.
RCU-Large-B............................ 40.2% (at 1,500 lb ice/24
hours).
26.7% (at 2,400 lb ice/24
hours).
SCU-W-Small-B.......................... 22.5%.
SCU-W-Large-B.......................... 27.6%.
SCU-A-Small-B.......................... 35.8%.
SCU-A-Large-B.......................... 29.6%.*
------------------------------------------------------------------------
* This is the second highest rated product; the highest rated product is
also a dispenser unit.
[[Page 14878]]
Efficiency levels for maximum available equipment in the continuous
type ice-making equipment classes are tabulated in Table IV.15. This
information is based on a survey of product databases and manufacturer
Web sites (also see data in chapter 3 of the TSD). The efficiency
levels are represented as an energy use percentage reduction compared
to the energy use of baseline-efficiency equipment, the selection for
which is discussed in section IV.D.2.a. DOE used the maximum available
efficiency levels to calibrate its engineering analysis against current
equipment.
Table IV.15--Efficiency Levels for Maximum Available Equipment for
Continuous Type Ice Maker Equipment Classes
------------------------------------------------------------------------
Equipment class Energy use lower than baseline
------------------------------------------------------------------------
IMH-W-Small-C.......................... 16.5%.
IMH-W-Large-C.......................... 12.2% (at 1,000 lb ice/24
hours).
8.6% (at 1,800 lb ice/24
hours).
IMH-A-Small-C.......................... 25.3%.
IMH-A-Large-C.......................... 8.1% (at 820 lb ice/24 hours).
17.0% (at 1,500 lb ice/24
hours).
RCU-Small-C............................ 18.4%.
RCU-Large-C............................ 18.5%.
SCU-W-Small-C.......................... 18.7%.*
SCU-W-Large-C.......................... No equipment on the market.*
SCU-A-Small-C.......................... 24.4%.
SCU-A-Large-C.......................... No equipment on the market.*
------------------------------------------------------------------------
* DOE's inspection of currently available equipment revealed that there
are no available products in the defined SCU-W-Large-C and SCU-A-Large-
C equipment classes at this time.
e. Maximum Technologically Feasible Efficiency Levels
When DOE proposes to adopt (or not adopt) an amended or new energy
conservation standard for a type or class of covered equipment such as
automatic commercial ice makers, it determines the maximum improvement
in energy efficiency that is technologically feasible for such
equipment. (See 42 U.S.C. 6295(p)(1) and 6313(d)(4)) Accordingly, in
the preliminary analysis, DOE determined the maximum technologically
feasible (``max-tech'') improvements in energy efficiency for automatic
commercial ice makers in the engineering analysis using energy modeling
and the design options that passed the screening analysis. As part of
the NOPR analysis, DOE modified its energy use analysis. In addition,
DOE considered a different range of design options. Evaluation of
maximum technological feasibility was again based on energy modeling,
but DOE compared energy modeling results with maximum available without
screened technologies to ensure consistency of results with actual
designs at that level. See chapter 5 of the NOPR TSD for the results of
the analyses, and a list of technologies included in max-tech
equipment.
The max-tech efficiency levels represent equipment combining all of
the design options. However, they are not generally attained by
existing equipment--this is largely due to the consideration of design
options seldom used in commercially available equipment because they
are not considered to be cost-effective by manufacturers, such as
brushless DC motors and drain water heat exchangers. DOE does not
screen out design options based on cost-effectiveness.
Table III.2 and Table III.3 show the max-tech levels determined in
the engineering analysis for batch and continuous type automatic
commercial ice makers, respectively.
Table IV.16--Max-Tech Levels for Batch Automatic Commercial Ice Makers
------------------------------------------------------------------------
Equipment type * Energy use lower than baseline
------------------------------------------------------------------------
IMH-W-Small-B.......................... 30%.
IMH-W-Med-B............................ 22%.
IMH-W-Large-B.......................... 17% (at 1,500 lb ice/24 hours).
16% (at 2,600 lb ice/24 hours).
IMH-A-Small-B.......................... 33%.
IMH-A-Large-B.......................... 33% (at 800 lb ice/24 hours).
21% (at 1,500 lb ice/24 hours).
RCU-Small-B............................ Not analyzed.
RCU-Large-B............................ 21% (at 1,500 lb ice/24 hours).
21% (at 2,400 lb ice/24 hours).
SCU-W-Small-B.......................... Not analyzed.
SCU-W-Large-B.......................... 35%.
SCU-A-Small-B.......................... 41%.
SCU-A-Large-B.......................... 36%.
------------------------------------------------------------------------
* IMH is ice-making head; RCU is remote condensing unit; SCU is self-
contained unit; W is water-cooled; A is air-cooled; Small refers to
the lowest harvest category; Med refers to the Medium category (water-
cooled IMH only); Large refers to the large size category; RCU units
were modeled as one with line losses used to distinguish standards.
Table IV.17--Max-Tech Levels for Continuous Automatic Commercial Ice
Makers
------------------------------------------------------------------------
Equipment type Energy use lower than baseline
------------------------------------------------------------------------
IMH-W-Small-C.......................... Not analyzed.
IMH-W-Large-C.......................... Not analyzed.
IMH-A-Small-C.......................... 25.3%.
IMH-A-Large-C.......................... 17% (at 820 lb ice/24 hours).
RCU-Small-C............................ Not analyzed.
RCU-Large-C............................ Not analyzed.
SCU-W-Small-C.......................... Not analyzed.
SCU-W-Large-C.* No units available.
SCU-A-Small-C.......................... 24%.
SCU-A-Large-C.* No units available.
------------------------------------------------------------------------
* DOE's investigation of equipment on the market revealed that there are
no existing products in either of these two equipment classes (as
defined in this NOPR).
f. Comment Discussion
Impact of the Variability of Ice Hardness Measurements on Efficiency
Levels for Continuous Type Ice Maker Equipment
Manitowoc noted that there are no industry standards for the
calorimetric values of different types of ice and cautioned that DOE's
assumptions for these calorimetric values may invalidate its analysis
of manufacturer-supplied data. (Manitowoc, Public Meeting Transcript,
No. 42 at pp. 51-52) Hoshizaki recommended that ice hardness have one
standard that incorporates all continuous type ice maker data and added
that DOE should readdress the baseline for continuous type ice-making
equipment after taking AHRI's 2012 ice hardness verification testing
into account. (Hoshizaki, No. 53 at p. 1)
Howe recommended that DOE supplement its data on continuous type
ice makers by including results from tests using the current test
procedure, adding that information on continuous type ice makers has
changed drastically as of late. (Howe, No. 51 at p. 2)
DOE notes that some of these comments were made before AHRI had
completed verification testing work that is mentioned by Hoshizaki. DOE
updated its database over the course of 2012, as many of the continuous
type ice maker data in AHRI's database were updated, and hardness data
was provided. DOE has primarily used this data, supplemented by DOE
test data (including hardness test data) to evaluate the energy
consumption characteristics of continuous type ice-making equipment and
to set efficiency levels.
DOE notes that, consistent with Hoshizaki's suggestion, the
proposed
[[Page 14879]]
standards for continuous type ice makers use one metric that combines
ice quality and energy usage. In addition, DOE has not proposed use of
the Canadian efficiency levels for continuous type ice makers. The
proposed efficiency levels for continuous type ice makers are discussed
in sections IV.D.2.a and IV.D.2.b.
Correlation of Efficiency Levels With Design Options
Manitowoc expressed confusion over the relationship between the
efficiency levels and the technology options that go into those
efficiency levels. Therefore, Manitowoc requested that DOE provide
additional information to explain which technology options were
associated with each efficiency level. (Manitowoc, Public Meeting
Transcript, No. 42 at p. 51)
Manitowoc pointed out that one of the SCU-air-cooled models used
for the max-available efficiency level is actually a combined ice
machine and hotel dispenser, and as such is not a representative
example of the SCU category, which generally consists of undercounter
designs. Manitowoc further stated that its larger size would allow the
model to achieve higher efficiencies than would normally be possible
for the majority of SCU air-cooled models. Therefore, Manitowoc
commented, this model should not be used to justify the max-available
efficiency attainable for this category of ice makers. (Manitowoc, No.
54 at pp. 2-3)
In response to Manitowoc's comment regarding the relationship of
design options and efficiency levels, DOE provided additional
information in the automatic commercial ice maker docket, as a
supporting and related material document \33\ (DOE, Preliminary
Analysis Presentation Supplementary Engineering Data, No. 43). The data
in this document reflects the preliminary engineering analysis. For the
NOPR analysis, the relationship between design options and efficiency
levels has changed due to changes made to the design options
considered, assumptions, and analysis approach. The new information is
detailed in sections IV.D.4.a (cost model adjustments) and IV.D.4.f
(energy model adjustments) and in the NOPR TSD chapter 5.
---------------------------------------------------------------------------
\33\ See www.regulations.gov/#!documentDetail;D=EERE-2010-BT-
STD-0037-0043. After the February 2012 preliminary analysis public
meeting, DOE published cost-efficiency curves showing the
relationship of efficiency levels to design options for each
directly analyzed equipment class.
---------------------------------------------------------------------------
DOE notes that Manitowoc is correct in its observation that one of
the max-available SCU models from the preliminary analysis is not
representative of the undercounter units that make up the majority of
the SCU category. DOE had intended to avoid inclusion of oversize SCU
models that are not suitable for undercounter design in its
establishment of maximum technology for SCU equipment classes. DOE has
reviewed the maximum technology designations and has removed all ice
maker-dispenser combinations from consideration in its analysis.
RCU Class Efficiency Level Differential
In its preliminary engineering analysis, DOE concluded that the 0.2
kWh per 100 lb ice differential in maximum allowable energy use for
large-sized batch RCU ice makers with remote compressors as compared
with those with compressors in the ice-making heads is appropriate,
both for batch and continuous type ice makers. (DOE, Preliminary
Analysis Public Meeting Presentation, No. 29 at p. 30) DOE requested
comment on this conclusion.
Manitowoc confirmed that the 0.2 kWh per 100 lb of ice difference
in energy use between these two classes of RCUs seemed valid and that
it was reasonable to continue using this value while developing the new
standards. (Manitowoc, Public Meeting Transcript, No. 42 at p. 44 and
No. 54 at p. 3) CA IOUs stated that its analysis of product data
indicates that RCUs with and without dedicated remote compressors do
not consume significantly different levels of energy. CA IOUs thus
suggested that DOE continue to look at product performance data and
customer utility in order to determine whether separate equipment
classes and efficiency levels are necessary for these two types of RCU
units. (CA IOUs, No. 56 at p. 2)
Consistent with the comment from Manitowoc, DOE plans to continue
using this differential of 0.2 kWh per 100 lb of ice to differentiate
between RCUs with and without remote compressors.
Batch Efficiency Levels for High-Capacity Ice Maker
DOE has established baseline and incremental efficiency levels for
large-capacity ice makers in the newly extended capacity between 2,500
and 4,000 lb ice/24 hours.
AHRI noted that the current efficiency standard for high-capacity
batch machines was established based on the performance of ice makers
available in the marketplace and that extending this efficiency level
to ice makers with capacities exceeding 2,500 lb ice/24 hours may not
be appropriate. AHRI recommended that DOE either select and analyze
products in this capacity range or refrain from regulating these
products if there are not actually enough high-capacity batch machines
available for DOE to analyze. (AHRI, No. 49 at pp. 3-4)
Manitowoc stated that efficiency curves are typically flat for
icemakers with capacities above 2,000 to 2,500 lb ice/24 hours and
noted that this phenomenon is driven mainly by trends in compressor
efficiencies, which have decreasing efficiency gains above a certain
size. Additionally, Manitowoc commented that it tends to use multiple
evaporators for large-capacity machines, rather than making new
evaporators for every size, so its overall evaporator performance also
does not improve significantly over a certain size. (Manitowoc, Public
Meeting Transcript, No. 42 at pp. 48-49)
However, Manitowoc also commented that DOE did not adequately
analyze the efficiency of ice machines in the 2,000 to 4,000 lb ice/24
hour capacity range. Manitowoc suggested that it is likely that, above
a certain capacity, DOE will find that the relative benefit of some
design options to be lower due to the relatively higher efficiency of
the baseline components already in use. (Manitowoc, No. 54 at p. 3)
Howe commented that most high-capacity ice makers are inherently
more efficient than their lower-capacity counterparts and thus cannot
be expected to achieve the same incremental efficiency gains. Howe
added that, if incremental efficiency gains do indeed vary
significantly by harvest capacity, equipment class definitions may need
to change. (Howe, No. 51 at pp. 2-3)
Hoshizaki recommended that DOE make equipment plots for high-
capacity batch models in order to compare existing models against the
proposed efficiency levels. (Hoshizaki, No. 53 at p. 2)
Hoshizaki commented that DOE needs to analyze the available data
for all eligible RCU models rather than just relying on software
assumptions to inform its analysis. Hoshizaki added that there is not
enough data available for DOE to adequately assess high-capacity
(>2,500 lb ice/24 hours) RCU energy use and recommended that
manufacturers provide input to DOE regarding these high-capacity units.
(Hoshizaki, No. 53 at p. 1)
In response to AHRI, DOE reiterates that there is precedence for
setting standards for capacity ranges for which equipment is not being
sold, including
[[Page 14880]]
when DOE adopted standards for air-cooled IMH cube type ice makers up
to 2,500 lb ice/24 hours, even though no such equipment is manufactured
with capacities above 1,650 lb ice/24 hours. DOE simply is extending
the capacity range of the standard for consistency with the
applicability of the test procedure. DOE notes that it has proposed
efficiency levels for the larger ice makers that, to the extent
possible, do not change as a function of harvest capacity. Manitowoc's
comments suggest that larger-capacity ice machines would have
comparable efficiency level as compared with lower-capacity machines,
and Howe's comments suggest that larger-capacity ice machines are
inherently more efficient. Hence, the constant energy use efficiency
level would be appropriate. The commenters did not highlight any other
specific factors that would suggest that the constant energy use
approach is inappropriate. Examination of the limited available data
showing rated energy use as a function of harvest capacity certainly
supports the approach, even though there is much less data to consider
that at the lower capacity levels.
In response to Manitowoc's comment regarding analysis of batch type
ice makers in the 2,000 to 4,000 lb ice/24 hours harvest capacity
range, DOE notes that it has conducted analysis for three of these
products--given the limited number of such products available, this
likely represents a greater percentage of the available products than
DOE evaluated at lower-harvest-capacity rates. Because, as mentioned by
Manitowoc, efficiency characteristics of the components of ice makers
such as compressors and evaporators no longer improve as capacity
increases, it is reasonable to expect that ice maker efficiency will
also remain constant at high-harvest-capacity rates. For this reason,
it is appropriate to represent performance of the full harvest capacity
range with the available ice makers of the highest harvest capacities,
as DOE has done.
In response to Howe's comment, DOE has not considered reductions in
efficiency at constant kilowatt-hours per 100 lb ice levels across the
harvest capacity range. Instead, DOE has considered reductions in
energy use in terms of percentages of baseline energy use. Hence, the
energy use reductions associated with the incremental efficiency levels
would be significantly less for a large-harvest-capacity ice maker with
an already inherently low energy use than it would for a lower-harvest-
capacity ice maker. Further, if the larger-capacity ice makers are
inherently more efficient, as Howe contends, DOE's approach using
efficiency levels that do not vary with capacity should not be overly
aggressive, i.e. setting efficiency levels too stringently.
With respect to Hoshizaki's recommendation regarding examination of
efficiency plots, DOE has reviewed energy use data for all products for
which such data is available. The maximum efficiency levels considered
in the analysis are not generally attained by existing equipment--this
is largely due to the consideration of design options often considered
not to be cost-effective by manufacturers, such as brushless DC motors
and drain water heat exchangers. However, DOE's analysis results
compared well to the maximum available without screened technologies
efficiency level.
In response to the second comment from Hoshizaki, DOE notes that
the analysis for high-capacity units considered several pieces of
information, including available performance rating data of the AHRI
database and confidential interviews with manufacturers. A significant
amount of the information obtained from manufacturers in confidential
interviews was obtained during the NOPR phase, in part in response to
preliminary analysis phase comments, such as the Hoshizaki comment,
recommending some information exchange. In addition, DOE purchased and
conducted reverse engineering on the largest-capacity batch and
continuous type ice makers made by the manufacturers that comprise 90
percent or greater share of the ice maker market. DOE also conducted
energy testing on a few of these ice makers. DOE believes that its
analysis of RCU equipment is representative of the large-capacity
equipment classes. Additional information on the teardown analysis is
available in chapter 5 of the NOPR TSD.
Discrepancies Between Maximum Technology Levels and Most-Efficient
Equipment Available in the Marketplace
NPCC, ASAP, and NEEA/NPCC commented on the max-tech efficiency
levels (i.e., least energy consumptive level) and that, in some cases,
max-tech levels were less efficient than the most-efficient level on
the marketplace (i.e., ``max-available'' energy level). NPCC further
commented that DOE should indicate whether this discrepancy is due to
technologies that were screened out. NEEA/NPCC pointed to products in a
Natural Resources Canada (NRCan) database that surpassed DOE's max-tech
levels. (NPCC, Public Meeting Transcript, No. 42 at pp. 45-46; ASAP,
Public Meeting Transcript, No. 42 at p. 50; NEEA/NPCC, No. 50 at pp. 2-
4) NPCC also recommended that DOE investigate whether there are
superior technologies on the market that were not being analyzed simply
because of the way max-tech is defined. NPCC added that the process by
which design options are screened out should be very deliberate. (NPCC,
Public Meeting Transcript, No. 42 at pp. 53-54)
Scotsman noted that, even within a single equipment class, maximum
technology levels will differ among models. For example, although DOE
is considering compressor upgrade as a design option, many ice maker
units are already using the most-efficient compressor suitable to their
respective applications. Scotsman added that the analytical model used
to calculate energy use for max-tech levels had not been validated and
was thus unreliable. (Scotsman, No. 46 at p. 4)
DOE acknowledges that there are units on the market that surpass
the max-tech levels it proposed for the preliminary analysis. In some
cases maximum available efficiency units include technologies that DOE
had decided not to consider. For example, some max-tech units utilize
proprietary technologies that are not available to the majority of
manufacturers and were screened out in the screening analysis. Due to
these differences, DOE's max-tech efficiency levels did not always
exceed the max-available levels found on the market. Because they are
representative of the whole market, DOE's max-tech levels must take
into account issues with proprietary technologies as well as utility
issues stemming from certain technologies (such as chassis size
increases or ice cube shapes).
In the NOPR phase, DOE made several changes to the preliminary
analysis. These changes included:
Adding a design option to allow for growth of the unit to
increase the size of the condenser and/or evaporator;
adjusting assumptions regarding maximum compressor EER
levels based on additional research and confidential input from
manufacturers;
adjusting potable water consumption rates for batch type
ice makers subject to a floor that represents the lowest potable water
consumption rate that would be expected to flush out dissolved solid
reliably;
adding a design option to allow condenser growth in water-
cooled condensers; and
adding a drain water heat exchanger design option.
These changes have led to new max-tech levels. These levels are
compared
[[Page 14881]]
to the most-efficient levels available on the market in Table IV.18.
The levels are also compared with the most-efficient levels available
that do not use technologies that DOE screened out in the screening
analysis (called ``max available without screened technologies'').
Specifically, for batch type ice makers, the differences between these
two max available market levels are that the max using analyzed
technologies levels do not consider (a) low-thermal-mass evaporators,
and (b) tube ice evaporators. The new max-tech levels all exceed the
``max available without screened technologies'' efficiency levels. DOE
also notes that this discrepancy only existed for batch units, as DOE
did not screen out any continuous unit technologies in its engineering
analysis.
DOE considered max-tech and max-available levels as part of its
analysis. The max-tech levels for batch and continuous type ice makers
are discussed in section IV.D.2.e. In addition to comparing the max-
tech, ``most efficient on market'', and the ``max available without
screened technologies'' efficiency levels for batch type ice makers.
Table IV.18 provides brief explanations for the differences between
max-available and max-tech levels. More details regarding the design
options that correlate with the different efficiency levels are
provided in the NOPR TSD. DOE requests comments on the max-tech levels
identified in today's NOPR, the max available and max available without
screened technologies levels, and the reasons cited for the max tech/
max available differences.
Table IV.18--Comparison of Levels for Batch Automatic Commercial Ice Makers
----------------------------------------------------------------------------------------------------------------
Reason for gap
Max-available between max-
without Max-available available and max
Equipment class Max-tech level screened (%) available without
technologies screened
(%) technologies
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B..................... 30%................. 22.0 24.5 Proprietary
technology.
IMH-W-Med-B....................... 22%................. 15.7 22.4 Proprietary
technology.
IMH-W-Large-B..................... 16% (at 2,600 lb ice/ 8.3 22.5 Proprietary
24 hours). technology and
utility issues.
IMH-A-Small-B..................... 33%................. 23.6 23.6 No gap.
IMH-A-Large-B..................... 33% (at 800 lb ice/ 20.7 21.3 proprietary
24 hours). technology.
21% (at 1,500 lb ice/
24 hours).
RCU-NRC-Small-B................... Not analyzed........ 24.6 24.6 No gap.
RCU-NRC-Large-B................... 21% (at 1,500 lb ice/ 15.7 40.2 Proprietary
24 hours). technology and
21% (at 2,400 lb ice/ utility issues.
24 hours).
RCU-RC-Small-B.................... Not directly 19.0 19.0 No gap.
analyzed.
RCU-RC-Large-B.................... Not directly 15.1 15.1 No gap.
analyzed.
SCU-W-Small-B..................... Not directly 22.2 22.5 Proprietary
analyzed. technology.
SCU-W-Large-B..................... 35%................. 27.6 32.9 Proprietary
technology.
SCU-A-Small-B..................... 41%................. 27.4 35.8 Proprietary
technology.
SCU-A-Large-B..................... 36%................. 29.6 33.4 Proprietary
technology.
----------------------------------------------------------------------------------------------------------------
Baseline Efficiency Levels for Currently Unregulated Ice Makers
For continuous and high-capacity batch type ice makers, AHRI
recommended that DOE derive its baseline efficiency levels from
machines that are currently on the market, for which AHRI's new
directory of certified products could be a useful information source.
AHRI cautioned, however, that its certification program was new and
that it expected the data to change after completion of its 2012 test
program. (AHRI, No. 49 at p. 3)
Manitowoc asserted that, while EPACT 2005 is the correct baseline
efficiency level for batch equipment, continuous type ice machines do
not have sufficient history under any alternative certification
programs and therefore require careful review and analysis by DOE prior
to setting efficiency levels. (Manitowoc, No. 54 at p. 3)
Hoshizaki asserted that DOE should not use Canadian levels for
continuous type ice makers and instead suggested that DOE use
efficiency levels developed for machines that are currently on the
market. (Hoshizaki, No. 53 at p. 1)
In the preliminary analysis, DOE proposed a set of equations to
represent baseline efficiency levels for the 12 continuous equipment
classes. 77 FR 3404 (Jan. 24, 2012). The equations were developed based
on publicly available information of continuous type ice maker energy
use for products on the market. As there was no source of ice quality
data for most of these products to allow calculation of the energy use
consistent with the new test procedure, which calls for adjustment of
the rating to account for ice hardness, DOE made these adjustments
using ice hardness equal to 0.85 for nugget ice makers and 0.8 for
flake ice makers. Further details of this analysis are available in the
preliminary analysis TSD.
DOE revised its development of continuous type ice maker efficiency
levels for the NOPR, based on data for continuous type ice machines
that was available on the AHRI database Web site as of October 11,
2012. The database now contains ratings for ice quality, which DOE
incorporated into its analysis. DOE's analyses consider higher max tech
levels than the max available levels, as represented by the AHRI data,
because the analysis considers use of design options, such as higher
efficiency permanent magnet motors, which are not used in the majority
of existing ice makers. DOE's continuous baseline levels for the NOPR
analysis are presented in Table IV.11.
DOE has taken advantage of the new information for continuous type
ice makers that has become available on the AHRI Web site to support
its selection of efficiency levels for these equipment classes.
General Methodology
Howe asked that DOE further clarify the methodology it used to
establish efficiency and technology levels, especially for equipment
classes in which there are few models available. Howe also asked
whether DOE considered the refrigerating conditions used to produce ice
or the typical efficiency levels associated with the refrigeration
system. (Howe, No. 51 at p. 3)
DOE does not have sufficient resources to thoroughly analyze all
[[Page 14882]]
equipment classes. Hence, the analyses for some classes are used to
represent other classes. The analysis prioritized those classes for
which shipments and the number of models available are high. The energy
model used to support the analysis, which is described in the NOPR TSD,
considers the refrigerating conditions used to produce ice and the
capacity and power input of the equipment's refrigerant compressors
when operating at these conditions.
3. Design Options
After conducting the screening analysis and removing from
consideration the technologies described above, DOE included the
remaining technologies as design options in the NOPR engineering
analysis. These technologies are listed in Table IV.19, with indication
of the equipment classes to which they apply.
[GRAPHIC] [TIFF OMITTED] TP17MR14.003
a. Improved Condenser Performance in Batch Equipment
During the preliminary analysis, DOE considered size increase for
the condenser to reduce condensing temperature and compressor power
input. DOE requested comment on use of this design option and on the
difficulty of implementing it in ice makers with size constraints.
AHRI commented that most condensers are already optimized and
occasionally oversized; therefore, further increasing condenser area
would not have any efficiency benefits and could instead necessitate
increased cabinet size. (AHRI, No. 49 at p. 2)
Manitowoc commented that the outdoor condensers of RCUs can more
easily accommodate size increases than the condensers incorporated into
IMH equipment. However, Manitowoc also noted that increasing the size
of the condenser coil in order to improve efficiency would necessitate
an increased level of refrigerant. Manitowoc stated that this could
require the installation of a larger receiver in the ice-making head,
which may be difficult due to size constraints. (Manitowoc, Public
Meeting Transcript, No. 42 at p. 59)
Manitowoc added that increasing the size of the condenser while
maintaining a constant evaporator size can also interfere with the
ability of the ice machine to properly make ice over the full range of
ambient conditions. Manitowoc stated that DOE's analysis is only
concerned with performance at 90[emsp14][deg]F air/70[emsp14][deg]F
water testing conditions, but that real ice makers have to work in air
temperatures ranging from 50 to 110[emsp14][deg]F and water
temperatures from 40 to 90[emsp14][deg]F. As air temperature drops,
Manitowoc stated, unless special refrigerant management devices are
employed, a larger condenser will be forced to store more refrigerant
at a lower temperature. This will prevent batch type ice machines from
being able to harvest ice at low ambient temperatures, according to
Manitowoc. (Manitowoc, No. 54 at p. 2) Similarly, Scotsman commented
that increasing the efficiency of the freeze cycle will lengthen the
harvest process and minimize overall energy savings. (Scotsman, Public
Meeting Transcript, No. 42 at pp. 59-60) Scotsman asserted that DOE's
analysis of condenser surface area must include this impact on the
batch harvest cycle. (Scotsman, No. 46 at p. 3)
Hoshizaki commented that manufacturers would need more time to
evaluate the implications of using larger water-cooled condensers on a
closed-loop system. Although larger condensers would increase the
efficiency of heat transfer, Hoshizaki opined that this benefit must be
compared with the increased final cost to the consumer as well as the
potential need to increase cabinet size. (Hoshizaki, No. 53 at p. 2)
In response to Manitowoc's written comments, DOE has considered
data obtained through testing of water-cooled units, as well as data
provided by manufacturers on expected efficiency increases versus
condenser growths.
DOE notes that the key concerns expressed in Hoshizaki's comment
relate to the potential need to increase cabinet size and the concern
about whether the larger condenser (and perhaps cabinet) is cost-
justified. As discussed in section IV.C.d, DOE has considered a modest
size increase for the ice-making head for some ice maker equipment
classes. Answering the question of whether condenser size increase
within these modest allowances for cabinet size increase is cost-
effective is a key goal of the DOE analyses--the potential that the
approach is not cost-effective is not a relevant argument for screening
out this technology.
[[Page 14883]]
In response to Scotsman and Manitowoc's written comments, DOE
conducted testing to assess the correlation of batch type ice maker
efficiency level with condensing temperature and has used this
information, which accounts for the increase in harvest energy use
associated with lower condensing temperature, to adjust its analyses.
DOE tested a water-cooled batch unit using different water-flow
settings; the results are shown in Table IV.20. DOE notes that these
test results indicate that there are energy benefits from increasing
condenser area, even though harvest cycle energy use increases. The
results show that the increase in harvest cycle energy use represents a
loss of 15 percent of the gain that would have been achieved if harvest
energy use had not increased. DOE used these test results to adjust the
modeled harvest energy when condenser improvement such as size increase
was applied as a design option. These analyses are described in chapter
5 of the NOPR TSD.
Table IV.20--Condenser Water Test Results
----------------------------------------------------------------------------------------------------------------
Test setting 1
Test attribute (factory- Test setting 2 Test setting 3
setting)
----------------------------------------------------------------------------------------------------------------
Condensing Temperature [deg]F................................... 97 107 111
Ice Harvest Rate lb ice/24 hours................................ 375 361 355
Energy Consumption kWh/100 lb ice............................... 4.67 5.13 5.28
Average Harvest Time (s)........................................ 104 81 73
Average Harvest Energy Wh....................................... 21.2 17.9 17.0
Average Harvest Energy per Ice kWh/100 lb....................... 0.53 0.44 0.42
Percent of Savings Lost due to Harvest Energy Increase.......... 15% 12% N/A
----------------------------------------------------------------------------------------------------------------
DOE inspected baseline and high-efficiency units, including
condenser sizes typical of each. For equipment classes for which DOE
inspected high-efficiency units, DOE considered maximum condenser sizes
consistent with the inspected units. For equipment classes where DOE
did not have such information, DOE considered maximum condenser sizes
consistent with the range of chassis sizes of commercially available
equipment of the given class and harvest capacity. DOE notes that none
of the evaluated IMH or SCU equipment has receivers, thus indicating
that they would not be needed for the range of condenser sizes DOE
considered in its analysis for these equipment classes. DOE also
considered whether a larger remote condenser would require installation
of a larger receiver, and talked with receiver manufacturers about
receiver sizing. DOE did not seek to increase receiver sizes for any of
the models analyzed.
In response to comments by AHRI and Manitowoc, DOE studied the
condensing temperatures of tested units to set limits for available
efficiency improvement. DOE in its analyses considered only condenser
changes that resulted in condensing temperatures within the range of
those observed in the tested ice makers for comparable equipment
classes (for instance DOE used different minimum condensing
temperatures for air-cooled and water-cooled equipment). These analyses
are described in chapter 5 of the NOPR TSD.
b. Harvest Capacity Oversizing
NPCC noted that many ice makers may be oversized for their
particular applications, suggesting that there would be little
compromise of customer utility if the capacity available for a given
ice maker chassis size decreased as a result of design changes that
increased their efficiency. (NPCC, Public Meeting Transcript, No. 42 at
pp. 60-61)
Manitowoc countered that its customers are very aware of how much
ice they need and that they consequently size machines for peak demand
days, rather than average use. Manitowoc added that it is very
important that customers not shut down on days with high demand, such
as the 4th of July. (Manitowoc, Public Meeting Transcript, No. 42 at p.
63)
DOE did not investigate potential down-sizing of equipment, instead
relying on information regarding commercially available units as the
basis for consideration of what sizes are acceptable for given capacity
levels.
c. Open-Loop Condensing Water Designs
Open-loop cooling systems use condenser cooling water only once
before disposing of it, whereas closed-loop (single-pass) systems
repeatedly recirculate cooling water. In closed loops, the water is
cooled in a cooling tower and recirculated to accept heat from the
automatic commercial ice maker condenser again. Alternatively, the
water passes through another heat exchanger where the heat is removed
and used in another piece of equipment, such as a space or water
heater, before cycling back to the ice maker condenser. Although some
condenser water may still be lost to evaporation in cooling towers,
closed-loop systems still have negligible condenser water disposal or
consumption compared to open-loop systems.
The Alliance expressed strong opposition to open-loop condenser
water cooling for automatic commercial ice makers, arguing that such
technology is obsolete and excessively wastes water and energy. The
Alliance noted that more energy-efficient technologies such as air
cooling, remote condensing, and closed-loop water-cooling systems have
made single-pass water cooling unnecessary. Therefore, the Alliance
urged DOE to disallow all ice makers that can be installed and operated
with a single-pass cooling system. (Alliance, No. 45 at pp. 3-4)
DOE recognizes that open-loop water-cooling systems use
significantly more water than other condenser cooling technologies.
However, DOE determined after the Framework public meeting that its
rulemaking authority extends only to the manufacturing of equipment and
not to the installation or usage of equipment. Thus, DOE has no
authority to mandate that dual-use water-cooled machines (those that
can be used in either closed-loop or open-loop configurations) be used
with closed-loop systems. Furthermore, DOE is not aware of any
potential design requirements it could impose that would effectively
prohibit open-loop cooling systems for water-cooled ice makers. Even if
a design requirement could be effective in this regard, DOE can only
adopt either a prescriptive design requirement or a performance
standard for commercial equipment. (42 U.S.C. 6311(18)) The focus of
this rulemaking is an equipment performance standard. Due to the nature
[[Page 14884]]
of this rulemaking, DOE is not considering any prescriptive design
requirements, and open-loop cooling systems therefore remain a viable
option for manufacturers of water-cooled ice makers who want to reduce
their water consumption.
d. Condenser Water Flow
EPACT 2005 prescribes maximum condenser water use levels for water-
cooled cube type automatic commercial ice makers. (42 U.S.C. 6313(d))
\34\ For units not currently covered by the standard (continuous
machines of all harvest rates and batch machines with harvest rates
exceeding 2,500 lb ice/24 hours), there currently are no limits on
condenser water use.
---------------------------------------------------------------------------
\34\ The table in 42 U.S.C. 6313(d)(1) states maximum energy and
condenser water usage limits for cube-type ice machines producing
between 50 and 2,500 lb of ice per 24 hour period (lb ice/24 hours).
A footnote to the table states explicitly the water limits are for
water used in the condenser and not potable water used to make ice.
---------------------------------------------------------------------------
In this rulemaking, DOE considered using higher condenser water
flow rates as a design option for water-cooled ice makers.
In chapter 2 of the preliminary TSD, DOE indicated that the ice
maker standards primarily focus on energy use, and that DOE is not
bound by EPCA to comprehensively evaluate and propose reductions in the
maximum condenser water consumption levels, and likewise has the option
to allow increases in condenser water use, if this is a cost-effective
way to improve energy efficiency.
DOE did not analyze potential changes in condenser water use
standards during the preliminary analysis. However, it did propose an
approach for balancing energy use and condenser water use in the
engineering analysis in a way that maintains the rulemaking's focus on
energy use reduction while appropriately considering the cost
implications of changing condenser water use. DOE proposed using
appropriate representative values for water and energy costs, product
lifetime, and discount rates to calculate a representative LCC for
baseline and modified design configurations as part of the engineering
analysis. In this way, the engineering analysis would develop a
relationship between energy efficiency and manufacturing cost as is
customary in engineering analyses (i.e., the cost-efficiency curves),
but the ordering of different design configurations in this curve would
be based on minimizing the representative LCC calculated for the
candidate design configurations at each successive efficiency level.
Using this proposed analytical approach, an energy-saving increase in
condenser water use would be expected to be cost-effective when the
remaining design options, which do not change water use, have greater
LCC increases than the option of increasing condenser water use. This
approach would avoid the complexity of developing several cost curves
representing multiple condenser water use levels and determining in the
downstream analyses the efficiency levels at which increasing condenser
water use would be appropriate. During the preliminary analysis, DOE
requested comment on this approach for addressing condenser water use.
AHRI commented that water-cooled ice makers are already efficient
products and that reducing condenser water consumption could
significantly increase their energy use. AHRI and Scotsman both
cautioned that DOE must consider the impact that lower condensing
temperatures could have on the harvest rate of batch type ice makers
and ensure that product utility is not diminished by implementing new
condenser water use standards. (AHRI, No. 49 at p. 4; Scotsman, Public
Meeting Transcript, No. 42 at p. 70)
In the public meeting discussions, Manitowoc suggested that DOE
consider decreasing the allowable condenser water use, which could be a
more economical approach if water costs increase. (Manitowoc, Public
Meeting Transcript, No. 42 at pp. 70-72) However, Manitowoc also noted
in its written comments that condenser water use is carefully managed
to ensure that ice makers can harvest ice under worst-case conditions
and maintain water velocities within specified limits in order to avoid
erosion. Manitowoc expressed doubt about the ability of DOE's energy
model to accurately predict the effects of these variables, and for
this reason, Manitowoc strongly discouraged introducing condenser water
use standards. (Manitowoc, No. 54 at pp. 3-4)
DOE stated that EPCA's anti-backsliding provision in section
325(o)(1), which lists specific products for which DOE is forbidden
from prescribing amended standards that increase the maximum allowable
water use, does not include ice makers. However, Earthjustice asserted
that DOE lacks the authority to relax condenser water limits for water-
cooled ice makers. Earthjustice argued that the failure of section
325(o)(1) to specifically call out ice maker condenser water use as a
metric that is subject to the statute's prohibition against the
relaxation of a standard is not determinative. On the contrary,
Earthjustice maintained that the plain language of EPCA shows that
Congress intended to apply the anti-backsliding provision to ice
makers. Earthjustice commented that section 342(d)(4) requires DOE to
adopt standards for ice-makers ``at the maximum level that is
technically feasible and economically justified, as provided in
[section 325(o) and (p)].'' (42 U.S.C. 6313(d)(4)) Earthjustice stated
that, by referencing all of section 325(o), the statute pulls in each
of the distinct provisions of that subsection, including, among other
things, the anti-backsliding provision, the statutory factors governing
economic justification, and the prohibition on adopting a standard that
eliminates certain performance characteristics. By applying all of
section 325(o) to ice-makers, section 342(d)(4) had already made the
anti-backsliding provision applicable to condenser water use, according
to Earthjustice. Finally, Earthjustice stated that even if DOE
concludes that the plain language of EPCA is not clear on this point,
the only reasonable interpretation is that Congress did not intend to
grant DOE the authority to relax the condenser water use standards for
ice makers. Earthjustice added that the anti-backsliding provision is
one of EPCA's most powerful tools to improve the energy and water
efficiency of appliances and commercial equipment, and Congress would
presumably speak clearly if it intended to withhold its application to
a specific product. (Earthjustice, No. 47 at pp. 4-5)
Scotsman commented that balancing condenser water use with energy
use was a reasonable analytical approach. (Scotsman, No. 46 at p. 3)
Scotsman added that including condenser water usage in the overall
energy use of a machine would also impact continuous type ice machines
by affecting ice hardness. (Scotsman, Public Meeting Transcript, No. 42
at p. 70)
The Alliance argued that water use and energy use cannot be
compared on a simple price basis because of key differences between the
two resources. While energy comes from multiple sources and is a
commodity whose prices fluctuate based on supply and demand, fresh
water is in limited supply, the Alliance stated. Hence, water prices
are heavily regulated and based on the cost of treatment and delivery,
which is less directly affected by supply and demand, according to the
Alliance. Therefore, the Alliance recommended that DOE consider the
marginal costs of alternative water sources, such as desalination, in
its analyses to properly account for all
[[Page 14885]]
water costs as applied to water-cooled condensers. (Alliance, No. 45 at
p. 4)
In response to Earthjustice's comment, DOE maintains its position
from the preliminary analysis that the anti-backsliding provision of
EPCA (42 U.S.C. 6313(d)(4)) does not apply to condenser water use in
batch-type automatic commercial ice makers. While EPCA's anti-
backsliding provision (42 U.S.C. 6295(o)) applies to consumer products,
42 U.S.C. 6313(d)(4) makes the backsliding provision applicable to
automatic commercial ice makers. However, 42 U.S.C. Sec. 6295(o)(1)
anti-backsliding provisions apply to water in only a limited set of
residential appliances and fixtures. Under 42 U.S.C. Sec. 6295(o)(1),
``the Secretary may not prescribe any amended standard which increases
the maximum allowable energy use, or, in the case of showerheads,
faucets, water closets, or urinals, water use, or decreases the minimum
required energy efficiency, of a covered product.'' This provision
links automatic commercial ice makers to the energy efficiency anti-
backsliding provision as a covered product, and does not include
automatic commercial ice makers among the products covered by the water
efficiency anti-backsliding provision. Thus, this section of EPCA
prohibits DOE from amending any standard in such a way as to decrease
minimum energy efficiency for any covered automatic commercial ice
maker equipment class. It does not, however, prohibit an increase in
water use in any products other than those enumerated in the statute,
and nothing in 6313(d)(4) expands the specific list of equipment or
appliances to which the water anti-backsliding applies. Therefore, an
increase in condenser water use would not be considered backsliding
under the statute. Nevertheless, the proposals do not include increases
in condenser water use.
Noting that condenser water standards are already in place for
batch type ice makers, DOE has decided to consider an increase in
condenser water use as a design option to improve energy efficiency for
all water-cooled ice makers. Acknowledging the concerns of stakeholders
such as AHRI, Manitowoc, and Scotsman, DOE recognizes that such an
approach must consider the cost-effectiveness of this design option
based on the end-user's water cost. DOE does not believe that the
contemplated changes would diminish product utility, because an
increase in the maximum allowed condenser water use would increase the
flexibility of manufacturers to meet the condenser water use standard.
Manufacturers would obviously not be required to increase condenser
water use, especially if such a design decision would negatively impact
the energy use or harvest rate of their ice makers.
In response to Manitowoc's observation that water velocities must
be maintained within specified limits in order to avoid erosion, DOE
conducted an analysis to determine whether current levels of water use
in water-cooled condensers are close to exceeding these limits. DOE has
learned from manufacturers of water-cooled condensers that water flow
rates generally should not exceed 3.5 gallons per minute per nominal
ton of condenser cooling capacity (gpm per ton).\35\ DOE's analysis of
test data for batch machines shows that the maximum condenser water
flow rate occurs shortly after harvest, and that there is some room for
increase of condenser water flow rate with the 3.5 gpm per ton limit.
DOE considered some increase of condenser water flow for batch type
units that did not already operate at this limit at the start of the
freeze cycle. Unlike batch type ice makers, whose condenser loads spike
shortly after the harvest cycle, continuous type ice makers typically
operate in steady-state. DOE's testing shows that flow rates in
continuous type ice makers are therefore far from the maximum levels
recommended to prevent erosion. However, DOE notes that it did not
perform direct analysis on any water-cooled continuous equipment
classes.
---------------------------------------------------------------------------
\35\ Personal communication with Piyush Desai at Packless
Industries on May 16, 2012.
---------------------------------------------------------------------------
As the manufacturers and AHRI point out, DOE must be careful in the
analysis of condenser water to ensure that the complex relationship
between condenser water and machine energy usage are modeled correctly.
However, balancing energy use and condenser water use following the
approach outlined above greatly simplifies an otherwise highly complex,
three-dimensional analysis of design options, condenser water use
levels, and efficiency. This analysis approach helped DOE determine
whether increasing condenser water limits could cost-effectively save
electricity.
DOE tested three water-cooled ice makers with varying condensing
water flow to evaluate the potential for energy savings and the cost-
effectiveness of using this approach. The results of this evaluation
for a batch type ice maker are shown in Table IV.21. The analysis
assumed that in the field half of the ice makers would be used in open
systems and half in closed-loop systems, which significantly reduce
water flow, as documented in chapter 5 of the NOPR TSD.
Table IV.21--Test Data for a Water-Cooled Batch Unit
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Condensing Temperature, [deg]F.................................. 97 107 111
Harvest Capacity, lb/24 hr...................................... 375 361 355
Energy Consumption, kWh/100 lb.................................. 4.67 5.13 5.28
LCC Operating Cost, $/100 lb.................................... $1.75 $1.38 $1.32
Condenser Water Use, gal/100 lb................................. 165.4 106.5 94.1
----------------------------------------------------------------------------------------------------------------
The analysis shows that increasing condenser water flow is not a
cost-effective way to reduce energy use. This was demonstrated also for
the two continuous type ice makers that were tested. As a result, DOE
did not comprehensively evaluate this approach for all water-cooled
equipment classes in its engineering analysis. Additional details are
available in chapter 5 of the NOPR TSD.
e. Compressors
Scotsman commented that the high-EER compressors in DOE's analysis
may not be feasible for ice makers, particularly batch type ice makers,
in which liquid refrigerant can often enter the compressor during the
harvest process. Scotsman noted that the design changes used by
compressor manufacturers to improve EER can reduce reliability, for
instance placing the compressor suction line closer to the suction
intake within the shell, which can cause liquid refrigerant to impinge
on the suction valve during harvest and rapidly lead to compressor
failure.
[[Page 14886]]
(Scotsman, No. 46 at p. 5) Manitowoc echoed Scotsman's second point,
indicating that a direct suction compressor would allow liquid to enter
the compressor cylinder and damage the valve system. (Manitowoc, No. 54
at p. 2)
In response to these comments, DOE consulted with manufacturers
regarding which compressors are appropriate for ice makers. DOE removed
from its analysis those compressors that manufacturers have indicated
are unsuitable for use in ice makers. As part of the NOPR analyses, DOE
also considered additional compressors of compressor lines that
manufacturers indicated are acceptable. The impact of these changes in
the analysis on the predicted potential efficiency improvement
associated with use of higher efficiency compressors varied by
equipment class. Additional details are available in chapter 5 of the
NOPR TSD.
f. Limitations on Available Design Options
Manitowoc commented that the small size of the ice maker industry
makes it difficult for ice maker manufacturers to implement new
technologies or influence the component (e.g., compressor or motor)
suppliers that they depend on for efficiency gains. Manitowoc noted
that, compared to other appliance industries, ice maker sales volumes
do not drive component suppliers to make design changes, so ice maker
manufacturers are limited to those changes that suppliers will
implement for larger customers. Furthermore, Manitowoc noted that,
rather than being independent appliances, ice makers are typically part
of a larger equipment chain for delivering food service products, which
places them under physical constraints and causes their technology
changes to have broader impacts on the entire food delivery industry.
(Manitowoc, Public Meeting Transcript, No. 42 at pp. 14-15)
For the NOPR analyses, DOE has used design options that are
commercially available. Many of these technologies are found in ice
makers that were inspected, and a few are available from component
manufacturers. DOE has taken care to ensure that those design options
identified do apply to these products.
For example, DOE has removed from its analysis any
compressors that may potentially interfere with ice maker operation
(based on their design).
DOE has also included an option to increase chassis sizes
(in order to grow internal components such as heat exchangers), but
limited chassis growth design options to only cover the modest levels
suggested by the available equipment offerings
Further information on DOE's analyses is contained in sections
IV.D.4.e and IV.D.4.f.
4. Development of the Cost-Efficiency Relationship
In this rulemaking, DOE has adopted a combined efficiency level/
design option/reverse engineering approach to developing cost-
efficiency curves. To support this effort, DOE developed manufacturing
cost models based heavily on reverse engineering of products to develop
a baseline MPC. DOE estimated the energy use of different design
configurations using an energy model whose input data was based on
reverse engineering, automatic commercial ice maker performance
ratings, and test data. DOE combined the manufacturing cost and energy
modeling to develop cost-efficiency curves for automatic commercial ice
maker equipment based on baseline-efficiency equipment selected to
represent their equipment classes. Next, DOE derived manufacturer
markups using publicly available automatic commercial ice maker
industry financial data, in conjunction with manufacturer feedback. The
markups were used to convert the MPC-based cost-efficiency curves into
MSP-based curves. Details of these analyses developed for the
preliminary analysis were presented in the preliminary analysis TSD and
in a supplementary data publication posted on the rulemaking Web site.
Stakeholder comments regarding DOE's preliminary engineering
analyses addressed the following broad areas:
1. Estimated costs in many cases were lower than manufacturers'
actual costs.
2. Estimated efficiency benefits of many modeled design options
were greater than the actual benefits, according to manufacturers'
experience with equipment development.
3. DOE should validate its energy use model based on comparison
with actual equipment test data.
4. DOE should validate its cost-efficiency analysis by
investigating the relationship of efficiency with retail prices for ice
makers.
5. The incremental costs in the engineering analysis should take
into consideration the design, development, and testing costs
associated with new designs.
These topics are addressed in greater detail in the sections below.
a. Manufacturing Cost
Manitowoc requested that DOE provide more information on the inputs
and methodology behind calculating the MPCs for each efficiency level.
(Manitowoc, Public Meeting Transcript, No. 42 at pp. 76-77) Manitowoc,
Scotsman, and AHRI all asserted that it is important for DOE to
accurately assess the potential incremental costs associated with each
efficiency level, since they will drive the decisions in this
rulemaking. (Manitowoc, Public Meeting Transcript, No. 42 at pp. 170-
171 and No. 54 at p. 1; Scotsman, Public Meeting Transcript, No. 42 at
p. 173; AHRI, No. 49 at p. 6)
Regarding the accuracy of DOE's cost model, Manitowoc commented
that some of the incremental costs between efficiency levels were
incorrect. Manitowoc added that, while it could not provide its bill of
materials, it would be willing to give DOE guidance regarding the
actual costs of implementing technology design changes at realistic
volumes. (Manitowoc, Public Meeting Transcript, No. 42 at pp. 80-81)
Scotsman agreed with Manitowoc that the table of incremental costs was
optimistic at best and added that changing one component in an ice
maker will often require also changing other components, further
affecting incremental costs. (Scotsman, Public Meeting Transcript, No.
42 at p. 85)
Specifically, Manitowoc, Scotsman, and AHRI each stated the belief
that DOE has underestimated the incremental costs of its proposed
design options. (Manitowoc, No. 54 at p. 1; Scotsman, No. 46 at p. 5;
AHRI, No. 49 at p. 6) For example, DOE estimated that the incremental
cost of using an electronically commutated motor (ECM) in place of a
shaded pole motor would be $13, whereas Scotsman's supplier quoted an
incremental cost of $35 for this same design option. Scotsman added
that, because the ice maker industry is relatively low-volume, ice
maker manufacturers face large cost premiums for component
technologies. (Scotsman, No. 46 at p. 5) AHRI noted that DOE assumed
that an 8 percent increase in compressor efficiency would cost only $9.
However, AHRI asserted that most compressors currently used in ice
makers are already mechanically optimized and could therefore achieve
greater efficiency only by switching to permanent magnet motors, which
would cost seven times more than DOE's incremental cost estimate. AHRI
cautioned that DOE should not assume that information it derived for
other rulemakings is automatically applicable to ice makers. AHRI also
opined that DOE drastically underestimated the cost of increasing
condenser surface area. (AHRI, No. 49 at p. 2) Finally, Manitowoc
commented that DOE's cost
[[Page 14887]]
estimates for ECM versions of the fan motors and pumps were
unrealistically low. (Manitowoc, No. 54 at p. 2)
In response to Manitowoc's first comment, DOE has provided
additional information correlating efficiency levels and design options
in this NOPR and its accompanying TSD. The TSD details the design
option changes and associated costs, calculated for each efficiency
level for the equipment analyzed.
In response to the comments by Manitowoc, Scotsman, and AHRI, DOE
had received very limited feedback from manufacturers regarding cost
estimates to support its preliminary engineering analysis. During the
NOPR phase of this rulemaking, DOE emphasized the need to obtain
relevant information from stakeholders by extending the comment period
by 40 days and welcoming comment on specific details presented in the
TSD regarding technology options and costs. Moreover, DOE's contractor
again worked directly with manufacturers under non-disclosure
agreements in order to obtain additional cost information.
DOE has significantly revised its component cost estimates for the
engineering analysis for the NOPR phase based on the additional
information obtained, both in discussions with manufacturers and in
stakeholder comments. DOE used the detailed feedback that it solicited
from manufacturers to update its cost estimates for all ice maker
components, significantly increasing its estimates of nearly all of
these costs. Additional details on the adjusted component costs are
available in chapter 5 of the NOPR TSD.
b. Energy Consumption Model
The energy consumption model calculates the energy consumption of
automatic commercial ice makers in kilowatt-hours per 100 lb of ice
based on detailed description of equipment design. The DOE analysis for
a given equipment class and capacity applied the model for a variety of
design configurations representing different performance levels. The
analysis starts with a baseline design, subsequently assessing the
differing energy consumption for incrementally more-efficient equipment
designs that utilize increasing numbers of design options. The results
of the energy consumption model are paired with the cost model results
to produce the points on the cost-efficiency curves, which correspond
to specific equipment configurations. After the publication of the
preliminary analysis, DOE received numerous stakeholder comments
regarding the methodology and results of the energy consumption model.
Manitowoc and Howe both commented that DOE's models significantly
overstated the efficiency gains associated with many of the design
options. (Howe, No. 51 at p. 3; Manitowoc, No. 54 at p. 2) As an
example, Howe pointed out that using a more efficient fan may not have
a significant impact on the overall efficiency of the ice maker, since
the fan represents a small fraction of its overall energy use. (Howe,
No. 51 at p. 3) Manitowoc added that its own tests on actual ice
machines under controlled conditions resulted in lower performance
gains than those predicted by the DOE models. (Manitowoc, No. 54 at p.
2)
Manitowoc commented that it would like to have more information on
the models used in DOE's engineering analysis. In particular, Manitowoc
stated that it would like to learn more about the FREEZE model, since
it is difficult to model the process of freezing water into ice and
even more difficult to model ice harvesting. Manitowoc noted that this
model will drive DOE's estimation of energy efficiency and that it is
important for manufacturers to understand the impacts of the model
before new standards take effect, especially if new efficiency levels
take manufacturers to technology levels far beyond their level of
experience. (Manitowoc, Public Meeting Transcript, No. 42 at pp. 171-
173)
Manitowoc also commented that the FREEZE model is limited by its
inability to model the harvest portion of the batch cycle. Manitowoc
stated that, although the harvest portion is shorter in duration than
the freeze portion, it represents a significant fraction of energy
consumption due to the higher energy input to the compressor and the
additional energy required to cool the evaporator after each harvest.
Manitowoc added that many changes that improve the freeze operation
efficiency, such as increasing condenser area, also reduce harvest
operation efficiency. Manitowoc expounded on this example by noting
that the increased condenser surface area reduces the design
temperature of the refrigerant, which results in lower energy available
during the harvest cycle, which in turn results in slower harvest times
and an overall increase in energy during the harvest cycle. Manitowoc
commented that DOE's FREEZE model is unable to account for such
behavior. (Manitowoc, No. 54 at pp. 1-2)
Scotsman and Hoshizaki both commented that the energy model will be
incomplete until it has been validated with real test results of
different technology design options. (Scotsman, Public Meeting
Transcript, No. 42 at pp. 173-174) Hoshizaki asserted that DOE should
not use the FREEZE model in the analyses until it has been validated.
(Hoshizaki, No. 53 at p. 1)
Scotsman inquired whether DOE intends to validate its cost-
efficiency model by implementing these design changes on actual
machines and evaluating their subsequent energy performance. (Scotsman,
Public Meeting Transcript, No. 42 at pp. 85-86)
In response to comments by Manitowoc, Howe, and Scotsman, DOE has
made changes to the energy modeling based on feedback received from the
manufacturers under non-disclosure agreements. To address concerns by
Manitowoc that the FREEZE model did not adequately model the effects of
increased condenser size on the harvesting energy, DOE also performed
testing of a water-cooled condenser batch unit, and used the test data
to develop a relationship between condensing temperatures and harvest
energy. DOE did note that lower condensing temperatures did result in
lower overall energy consumption, but higher harvest energy
consumption.
Table IV.22--Test Data for a Water-Cooled Batch Unit
----------------------------------------------------------------------------------------------------------------
Test level Units 1 2 3
----------------------------------------------------------------------------------------------------------------
Condenser Temperature.............. [deg]F..................... 97.36 107.47 111.36
Ice Harvest........................ lb/24 hr................... 375 361 355
Overall Energy Consumption......... kWh/100 lb................. 4.67 5.13 5.28
Average Harvest Energy Consumption. Wh......................... 21.21 17.86 17.03
LCC Operating Cost................. $/100 lb................... $1.75 $1.38 $1.32
Condenser Water Use................ gal/100 lb................. 165.4 106.5 94.1
----------------------------------------------------------------------------------------------------------------
[[Page 14888]]
Further information on DOE's engineering analysis and energy model
adjustments is contained in sections IV.D.4.e and IV.D.4.f.
c. Retail Cost Review
AHRI and Hoshizaki both questioned the accuracy of DOE's
incremental cost-efficiency analysis. AHRI and Hoshizaki recommended
that DOE validate it by comparing its results with actual retail
prices. (AHRI, Public Meeting Transcript, No. 42 at pp. 78-80, 82-83,
174-175, and No. 49 at p. 6; Hoshizaki, Public Meeting Transcript, No.
42 at p. 84 and No. 53 at p. 1).
In response to AHRI's and Hoshizaki's request for cost validation,
DOE prepared a price analysis for automatic commercial ice makers to
evaluate the correlation of price with higher ice maker efficiency. DOE
collected list price information from publicly available automatic
commercial ice maker manufacturer price sheets for 470 ice makers. DOE
collected other information relevant to the analysis appropriate
sources, including equipment dimensions, harvest capacity, ENERGY STAR
qualification, and energy use. For equipment classes for which there
were data available for more than 20 ice makers, price and ice harvest
rate were shown to have a strong linear correlation, with R-squared
values ranging from 0.63 to 0.84. This result indicates that customers
pay more for higher-capacity ice makers.
While an initial evaluation of price trends with efficiency
suggested that prices are higher for higher efficiency ice makers,
subsequent analysis suggests that this trend can be attributed to the
trend for reduction in energy use for higher harvest capacity and the
aforementioned relationship between price and harvest capacity. For the
equipment classes for which there were sufficient ice makers to
analyze, DOE determined the best-fit linear relationship predicting
price as a function of ice harvest rate. DOE then evaluated the
relationship between each ice maker's price differential (i.e., the
difference between its price and the best-fit linear function),
expressed as a percentage of the predicted price, with the ice maker's
energy consumption rate (in kWh/100 lb ice), developing best-fit linear
relationships for these trends. DOE noted that the linear relationships
showed either no growth or very small growth in price as energy
consumption increased. These results indicate that there is no
correlation between higher efficiency and higher retail prices for ice
machines. However, DOE did not conclude, based on this analysis, that
there would be no costs associated with improving equipment
efficiency--rather, it concluded that retail prices are not a reliable
indicator of these costs. Additional information on this analysis can
be found in chapter 3 of the NOPR TSD.
d. Design, Development, and Testing Costs
Hoshizaki commented that DOE's incremental cost-efficiency analysis
must include all aspects of design changes, including the additional
design time, testing, and increased labor, when calculating incremental
costs. Hoshizaki added that manufacturers could help DOE by reviewing
the actual costs associated with redesigning their machines to meet the
2010 DOE energy standards as well as ENERGY STAR standards. Hoshizaki
expressed its willingness to collaborate with DOE and AHRI. (Hoshizaki,
No. 53 at p. 3)
DOE incorporates the cost of additional design time, testing,
labor, and tooling into its manufacturer impacts analysis, as described
in section IV.J. During the NOPR analyses, DOE and its contractors
contacted manufacturers and obtained related costs under non-disclosure
agreements. More information on these analyses is available in section
IV.J.
e. Empirical-Based Analysis
In response to comments from Scotsman and Hoshizaki about the
validity of the energy model, DOE investigated using an empirical
efficiency level approach for the engineering analysis rather than the
approach combining energy modeling and manufacturing cost modeling that
was used in the preliminary analysis. DOE performed this analysis for
eight batch equipment classes and three continuous equipment classes.
The alternative approach was to develop the cost-efficiency curves
based on rated or tested automatic commercial ice makers energy use
levels and costs estimated using the manufacturing cost model with
updates from manufacturer discussions, as described in section
IV.D.4.a. To support the empirical analysis, DOE purchased and tested
20 additional ice makers, giving DOE a total of 39 ice makers for
evaluation.
Table IV.23 shows the resulting costs for equipment classes that
were analyzed using the empirical approach and the energy modeling
approach. The incremental cost of reaching a 15 percent below baseline
efficiency level is listed below. In 7 out of 9 equipment classes, the
energy modeling approach result was far more conservative (i.e.,
resulted in higher incremental cost estimates) than the empirical
approach result; DOE estimated a negative cost-efficiency relationship
in five of these cases for the empirical approach.
Table IV.23--Comparison of NOPR and Empirical Analysis Approaches at the
15% Efficiency Level
------------------------------------------------------------------------
15% EL 15% E
Incremental cost Incremental cost
from empirical from NOPR
approach (energy modeling)
------------------------------------------------------------------------
IMH-A-Small-B..................... $4.88 $45.00
IMH-A-Large-B..................... (32.32) 39.00
IMH-W-Small-B..................... (102.62) 37.00
IMH-W-Medium-B.................... (543.66) 53.00
RCU-NRC-Small-B................... 4.70 * NA
RCU-NRC-Large-B................... 166.03 198.00
SCU-A-Large-B..................... (106.45) 40.00
SCU-A-Small-B..................... 47.41 32.00
IMH-A-C........................... 74.60 46.00
RCU-NRC-C......................... (354.91) * NA
SCU-A-C........................... (244.80) 28.00
------------------------------------------------------------------------
* The NOPR analysis did not directly analyze this equipment class.
[[Page 14889]]
DOE compared the results of the empirical analysis and the results
of the energy modeling, and concluded that the energy modeling results
provided a better and more consistent forecast in the ability of
manufacturers to reach certain efficiency levels. While the analyses
rigorously account for the cost differences in key components that
affect energy use, the costs to achieve higher efficiency levels range
from higher than the NOPR estimates to very low to negative. DOE is
concerned that, while the calculated cost differences may accurately
reflect actual cost differences between the chosen pairs of models, the
results may be very dependent on the details associated with the
specific model selections, and may vary depending on the units that are
selected. DOE's empirical analysis does indicate that the energy
modeling approach does not underestimate the cost-efficiency steps
required to reach higher efficiencies. DOE believes that careful
calibration of the energy model combined with reassessment of the cost
model can result in accurate cost-efficiency curves.
Thus, DOE decided to proceed with the energy modeling approach as
the main basis for the engineering analysis. DOE has addressed many of
the stakeholder comments as it updated the energy modeling analysis.
The details of the energy modeling approach are described in the next
section, section IV.D.4.f.
Additional details and results of the empirical analysis are
available in chapter 5 of the NOPR TSD. DOE believes that the results
of the empirical analyses support the results of DOE's design option
analysis.
f. Revision of Preliminary Engineering Analysis
After investigation of and rejection of an empirical efficiency
level analysis approach, DOE instead developed the NOPR engineering
analysis by updating the preliminary engineering analysis. This
included making adjustments to the manufacturing cost model as
described in section IV.D.4.a. It also included adjustments to energy
modeling.
The design options considered in the analysis changed, as the
discussion of the updated screening analysis details in section IV.C.
DOE also made several changes to the FREEZE energy model used to
estimate energy use of different ice maker design configurations. To
address the concerns raised by Manitowoc and Howe, DOE adjusted its
energy models based on input received in manufacturers' public and
confidential comments and discussions DOE's contractor conducted under
non-disclosure agreements. These changes included:
Adjustment of the compressor coefficients for batch type
ice makers;
using data from tests of ice makers to model the increase
of harvest energy as condensing temperature decreases for batch type
ice makers;
developing an approach based on test data to determine the
condensing temperature reductions associated with use of larger water-
cooled condensers;
limiting adjustments to the potable water use of batch
products to a minimum of 20 gallons per 100 lb (or the starting potable
water use level, if lower)
incorporating energy use reduction for drain water heat
exchangers used in batch equipment.
Finally, for the max-tech design options that extended beyond what
was typically found in commercially available products (such as
permanent magnet motors and drain water heat exchangers) that could not
be calibrated against existing units, DOE relied on testing and
literature to properly account for the energy savings of these units.
For drain water heat exchangers, DOE performed testing of a batch
type ice maker with a commercially available drain water heat
exchanger, and used the test results to calibrate the energy savings
obtained from this technology for each equipment class where it was
applied.
DOE used motor efficiency ratings discussed in the preliminary
analysis and verified with stakeholders to scale the motor use of each
component using permanent magnet motors. During the NOPR analyses,
DOE's energy model was calibrated to properly account for the energy
consumption of each component, and for energy reductions resulting in
jumps to PSC technologies. Increases in the efficiency of the motor
components can then be expressed as reductions in the energy
consumption of these components.
DOE calibrated the efficiency gains calculated by the energy model
against the design options and test results gathered during the
empirical analysis investigation. DOE used this comparison to determine
the suite of design options that should be found at the appropriate
high-efficiency level, and calibrated the results of the energy against
the inspected results.
For example, DOE inspected a pair of IMH-A-Small-B automatic
commercial ice makers with measured efficiency levels of 2.2 percent
below baseline and 17.5 percent below baseline, and noted the following
changes between units:
Increases in both the evaporator face area and condenser
volume, and an increase in the chassis size to accommodate these
growths,
an increase in condenser fan size and a change from an SPM
motor to a PSC motor, and
an increase in compressor EER.
In the energy model, DOE separated out each of the different design
options and considered separately, ordering them in order of cost-
efficiency. For this equipment class, DOE had the following design
options to increase efficiency from baseline to 23.5 percent below
baseline, as shown in Table IV.24.
Table IV.24--IMH-A-Small-B Design Options
------------------------------------------------------------------------
% Below baseline Design option
------------------------------------------------------------------------
0.00............................. Baseline.
6.22............................. Increase compressor EER from 4.86 EER
to 5.25 EER.
7.71............................. Increase condenser width (no chassis
size increase).
20.52............................ Increase Evaporator Area (with
chassis size increase).
23.51............................ Switch to PSC Condenser Fan Motor.
------------------------------------------------------------------------
In some instances, DOE considered slightly different design
options, especially when DOE's analysis found that more efficient
compressor options were available. For example, the maximum compressor
EER used in the energy modeling analysis was more efficient than the
inspected unit compressor EER. This is the reason this suite of design
options reaches higher efficiencies. DOE did not consider chassis sizes
larger than those available on the market.
DOE believes that these changes help ensure that the energy model
results accurately reflect technology behavior in the market. Further
details on the analyses are available in chapter 5 of the NOPR TSD.
E. Markups Analysis
DOE applies multipliers called ``markups'' to the MSP to calculate
the customer purchase price of the analyzed equipment. These markups
are in addition to the manufacturer markup (discussed in section
IV.D.4) and are intended to reflect the cost and profit margins
associated with the distribution and sales of the equipment between the
manufacturer and customer. DOE identified three major distribution
channels for automatic commercial ice makers, and markup values were
calculated for each distribution channel based on industry financial
data. Table IV.25 shows the three distribution
[[Page 14890]]
channels and the percentage of the shipments each is assumed to
reflect. The overall markup values were then calculated by weighted-
averaging the individual markups with market share values of the
distribution channels. See chapter 6 of the NOPR TSD for more details
on DOE's methodology for markups analysis.
Table IV.25--Distribution Channel Market Shares
----------------------------------------------------------------------------------------------------------------
Contractor
National Wholesaler channel:
account channel: Contractor
channel: Manufacturer purchase from
Analysis phase Manufacturer to distributor distributor
direct to to customer for
customer (1- (2-party) (%) installation
party) (%) (3-party) (%)
----------------------------------------------------------------------------------------------------------------
Preliminary Analysis............................................ 6 32 62
NOPR............................................................ 0 38 62
----------------------------------------------------------------------------------------------------------------
In general, DOE has found that markup values vary over a wide range
based on general economic outlook, manufacturer brand value, inventory
levels, manufacturer rebates to distributors based on sales volume,
newer versions of the same equipment model introduced into the market
by the manufacturers, and availability of cheaper or more
technologically advanced alternatives. Based on market data, DOE
divided distributor costs into (1) direct cost of equipment sales; (2)
labor expenses; (3) occupancy expenses; (4) other operating expenses
(such as depreciation, advertising, and insurance); and (5) profit. DOE
assumed that, for higher efficiency equipment only, the ``other
operating costs'' and ``profit'' scale with MSP, while the remaining
costs stay constant irrespective of equipment efficiency level. Thus,
DOE applied a baseline markup through which all estimated distribution
costs are collected as part of the total baseline equipment cost, and
the baseline markups were applied as multipliers only to the baseline
MSP. Incremental markups were applied as multipliers only to the MSP
increments (of higher efficiency equipment compared to baseline) and
not to the entire MSP. Taken together the two markups are consistent
with economic behavior in a competitive market--the participants are
only able to recover costs and a reasonable profit level.
DOE received a number of comments regarding markups after the
publication of the preliminary analysis.
AHRI stated that equipment markups often result in retail prices
that are lower than what is observed in the market place, and stated
that DOE should supplement its analysis with a survey or retail sale
prices. (AHRI, No. 49 at pp. 4-5) Scotsman suggested reviewing
equipment pricing on the internet because many ice makers are available
online. (Scotsman, No. 46 at p. 5)
Scotsman stated that the national account chain is not accurate.
Scotsman commented that the national account distribution chain
resembles the wholesaler distribution chain, because an equipment
supplier is part of the process. The supplier may contract directly
with the customer but equipment still goes through another party,
according to Scotsman. (Scotsman, No. 42 at p. 97) Manitowoc agreed
with Scotsman that the national accounts chain is misrepresented, and
actually includes a third party to do installation, repair, and
maintenance. (Manitowoc, No. 42 at pp. 99-100)
Manitowoc stated that mechanical contractors are typically not part
of the distribution chain. Manitowoc indicated dealers may in fact
provide those services, but the model is a little different from the
model presented. (Manitowoc, No. 42 at p. 102-3)
Hoshizaki agreed with the analysis of distribution channels.
(Hoshizaki, No. 53 at p. 2) Manitowoc suggested another distribution
channel exists: rather than a sale to an end-user, the dealer leases it
to the customer. (Manitowoc, No. 42 at p. 98) Manitowoc was of the
opinion that whether the equipment was sold or leased to the customer,
the end result would be that the ultimate equipment price would not be
affected. (Manitowoc, No. 42 at p. 99)
Manitowoc questioned the basic methodology of using a base and
incremental markup. Manitowoc stated that if it changed a product, it
would expect the same gross margin on the incremental cost as on the
base. (Manitowoc, No. 42 at p. 104) Manitowoc stated that entities in
the distribution chain take the manufacturer's list price and add a
markup. Manitowoc stated that by using the incremental markup, DOE is
understating the impact in the market place of adding additional costs
to raise the efficiency level, and that is not what happens in the
market, according to Manitowoc. (Manitowoc, No. 42 at p. 105) Manitowoc
stated that the incremental markup should be the same as the baseline
markup and that it would be unreasonable to expect that vendors would
earn a lower margin on additional costs associated with complying by
the increased minimum efficiency regulations. (Manitowoc, No. 54 at p.
3)
With regard to the AHRI, Scotsman, and Manitowoc comments related
to retail prices surveys or studies to determine if DOE was
underestimating prices, DOE performed a market price survey, reported
earlier in the engineering section IV.D.4.c. Previously DOE has not
performed retail price surveys, believing that scatter in the data--
particularly when internet and non-internet prices are co-mingled--
would cause surveys to provide data of poor value or usefulness. The
results of the retail price survey performed for the engineering
analysis supports this belief.
With regard to the comment that mechanical contractors are
typically not part of the distribution chain, DOE is using mechanical
contractor cost information to model a three-party distribution
channel. Available Census Bureau data as well as comments received at
the Framework public meeting indicates that a three-party distribution
channel is common. At present the mechanical contractor cost data is
the best information available for quantifying the local contractor
portion of the three-party channel, and DOE used this data for
developing costs contained in this notice. DOE requests specific data
or data sources to better categorize the third party costs attributable
to local dealers or contractors.
The Scotsman and Manitowoc comments about the national account
chain being misrepresented indicate that the national account channel
is basically the same as the wholesaler
[[Page 14891]]
channel. Thus, the 6 percent of shipments initially assigned to the
national account channel will be combined with the wholesaler channel
shipments and assessed the wholesaler channel markup. With regard to
adding another channel for leased equipment, since Manitowoc suggested
the pricing of equipment in such a hypothetical channel would not
differ from other equipment, DOE elects to not add an additional
channel.
With respect to the comments questioning the use of an incremental
markup, DOE believes that there is likely an inaccurate comparison
taking place. In competitive markets, such as the automatic commercial
ice maker market, the participants are expected to be able to recover
costs and a reasonable profit, which is what the markups designed and
used by participants would be expected to do. In the DOE analysis, the
baseline markup has been calculated to recover all currently existing
overhead expenses with baseline equipment costs. DOE's analysis focuses
on changes. Profit margin and other costs that change as MSP changes
were assigned to incremental markups. Most overhead costs were
allocated to the base markup because DOE does not expect these costs to
change because of MSP changes brought on by efficiency standards. DOE
developed the baseline and incremental markup methodology to ensure all
overhead costs are fully collected and a reasonable profit margin is
received and to identify costs that change, and apply such to the
incremental MSP in the form of incremental markups.
F. Energy Use Analysis
For the preliminary analysis and for the NOPR, DOE estimated energy
usage for use in the LCC and NIA models based on the kWh/100 lb ice and
gal/100 lb ice values developed in the engineering analysis in
combination with other assumptions. In the preliminary analysis, DOE
assumed that ice makers on average are used to produce one-half of the
ice the machines could produce (i.e., a 50 percent capacity factor).
DOE also assumed that when not making ice, on average ice makers would
draw 5 watts of power. DOE modeled condenser water usage as ``open-
loop'' installations, or installations where water is used in the
condenser one time (single pass) and released into the wastewater
system.
Several stakeholders agreed with the 50 percent capacity factor
being reasonable. Scotsman stated that the 50 percent utilization
factor is relatively close, given the wide spectrum that exists based
on seasonality and installation location. (Scotsman, Public Meeting
Transcript, No. 42 at p. 108) AHRI stated that on average, across all
applications and seasons, the 50 percent utilization factor assumed by
DOE is appropriate. (AHRI, No. 49 at p. 5) Manitowoc agreed that 50
percent utilization is a good number to use. (Manitowoc, Public Meeting
Transcript, No. 42 at p. 110) Hoshizaki, on the other hand, thought 50
percent was on the low side for the industry, and some business types,
like 24-hour restaurants, might have much higher usage factors.
(Hoshizaki, Public Meeting Transcript, No. 42 at p. 111) NPCC expressed
a desire to have information made available to determine if there is an
equipment class relationship between the duty cycles and the business
type, and whether duty cycle is related to the equipment class and/or
the product capacity. NPCC believed that this may determine whether one
is more cost-effective to pursue than another. (NPCC, Public Meeting
Transcript, No. 42 at p. 111)
For the NOPR, DOE has continued to utilize a 50 percent capacity
factor, as most commenters believed it to be a reasonable number and
DOE did not receive utilization data in the comments that would lead it
to consider alternative capacity factors in the analysis. In response
to the Hoshizaki comment and in agreement with the NPCC comment, DOE
requests additional information about reasonable values that could be
used to vary the assumption by business type.
Several stakeholders commented on the assumption of an open-loop
installation for water-cooled condensers. Scotsman commented that the
majority of ice makers are installed in open-loop configurations.
Scotsman stated that in some business types like hotels or casinos,
there will typically be cooling towers and recirculation systems that
the ice maker can tap into. In smaller locations without that type of a
resource, it would typically be open loop, according to Scotsman.
(Scotsman, Public Meeting Transcript, No. 42 at pp. 108-109) Scotsman
added that single-pass configuration provides a worst-case energy use,
and is appropriate for this analysis. (Scotsman, No. 46 at p. 3)
Manitowoc stated that it only knows of installations in casinos or
other large projects where ice makers are installed on closed loops,
and suspects that most historical installations are open loop.
(Manitowoc, No. 42 at p. 110)
NEEA recommended that DOE investigate the market share of automatic
commercial ice makers with single-pass condensers, because they use
substantially more water than those with other condenser
configurations. (NEEA, Public Meeting Transcript, No, 42 at pp. 165-
166) NPCC stated that some jurisdictions do not permit open-loop
installations because of water usage. (NPCC, Public Meeting Transcript,
No. 42 at pp. 109-110)
Hoshizaki suggested placing water-cooled units in closed-loop
systems. (Hoshizaki, No. 42 at p. 110) Hoshizaki stated that, in
certain areas, water-cooled condensers could be the most effective form
of condensing. (Hoshizaki, No. 53 at p. 2)
DOE agrees with Hoshizaki's comment that water-cooled condensers
can be a cost-effective form of condensing. DOE does not envision
promulgating any rule that would eliminate water-cooled condensers.
Since DOE's regulatory authority relates to the efficiency of equipment
manufactured or sold in the U.S. but not to how equipment is installed
or used, DOE does not plan to promulgate rules mandating use of closed
loops. DOE is not proposing to perform the research suggested by NEEA
into the prevalence of open- versus closed-loop installations. It is
always DOE's objective to model energy usage as accurately as possible,
so DOE requests stakeholder assistance in quantifying the impact of
local regulations such as any local regulation potentially forbidding
an open-loop installation. Scotsman and Manitowoc stated that,
historically, most installations were likely open-loop, but the
regulations discussed by NPCC would argue that in the future such is
less likely to be true. DOE's analyses to date have not included design
options that would change condenser water usage, a fact that means the
question of modeling condenser water in the LCC models condenser water
usage as open- or closed-loop impacts the absolute value of life-cycle
costs and total national costs of ownership and operation, but not LCC
savings or increases/decreases in NPV. Given that Scotsman and
Manitowoc believe that historically most installations have likely been
open loop, DOE chose to continue to model water usage as an open-loop
(or single-pass) system.
G. Life-Cycle Cost and Payback Period Analysis
In response to the requirements of EPCA in (42 U.S.C.
6295(o)(2)(B)(i) and 6313(d)(4)), DOE conducts LCC and PBP analysis to
evaluate the economic impacts of potential amended energy conservation
standards on individual commercial customers--that is, buyers of the
equipment. This section describes
[[Page 14892]]
the analyses and the spreadsheet model DOE used. NOPR TSD chapter 8
details the model and all the inputs to the LCC and PBP analyses.
LCC is defined as the total customer cost over the lifetime of the
equipment, and consists of installed cost (purchase and installation
costs) and operating costs (maintenance, repair, water,\36\ and energy
costs). DOE discounts future operating costs to the time of purchase
and sums them over the expected lifetime of the unit of equipment. PBP
is defined as the estimated amount of time it takes customers to
recover the higher installed costs of more-efficient equipment through
savings in operating costs. DOE calculates the PBP by dividing the
increase in installed costs by the savings in annual operating costs.
DOE measures the changes in LCC and in PBP associated with a given
energy and water use standard level relative to a base-case forecast of
equipment energy and water use (or the ``baseline energy and water
use''). The base-case forecast reflects the market in the absence of
new or amended energy conservation standards.
---------------------------------------------------------------------------
\36\ Water costs are the total of water and wastewater costs.
Wastewater utilities tend to not meter customer wastewater flows,
and base billings on water commodity billings. For this reason,
water usage is used as the basis for both water and wastewater
costs, and the two are aggregated in the LCC and PBP analysis.
---------------------------------------------------------------------------
The installed cost of equipment to a customer is the sum of the
equipment purchase price and installation costs. The purchase price
includes MPC, to which a manufacturer markup (which is assumed to
include at least a first level of outbound freight cost) is applied to
obtain the MSP. This value is calculated as part of the engineering
analysis (chapter 5 of the NOPR TSD). DOE then applies additional
markups to the equipment to account for the costs associated with the
distribution channels for the particular type of equipment (chapter 6
of the NOPR TSD). Installation costs are varied by State depending on
the prevailing labor rates.
Operating costs for automatic commercial ice makers are the sum of
maintenance costs, repair costs, water, and energy costs. These costs
are incurred over the life of the equipment and therefore are
discounted to the base year (2018, which is the proposed effective date
of the amended standards that will be established as part of this
rulemaking). The sum of the installed cost and the operating cost,
discounted to reflect the present value, is termed the life-cycle cost
or LCC.
Generally, customers incur higher installed costs when they
purchase higher efficiency equipment, and these cost increments will be
partially or wholly offset by savings in the operating costs over the
lifetime of the equipment. Usually, the savings in operating costs are
due to savings in energy costs because higher efficiency equipment uses
less energy over the lifetime of the equipment. Often, the LCC of
higher efficiency equipment is lower compared to lower-efficiency
equipment.
The PBP of higher efficiency equipment is obtained by dividing the
increase in the installed cost by the decrease in annual operating
cost. For this calculation, DOE uses the first-year operating cost
decreases as the estimate of the decrease in operating cost, noting
that some of the repair and maintenance costs used in the analysis are
annualized estimates of costs. DOE calculates a PBP for each efficiency
level of each equipment class. In addition to the energy costs
(calculated using the electricity price forecast for the first year),
the first-year operating costs also include annualized maintenance and
repair costs.
Apart from MSP, installation costs, and maintenance and repair
costs, other important inputs for the LCC analysis are markups and
sales tax, equipment energy consumption, electricity prices and future
price trends, expected equipment lifetime, and discount rates.
As part of the engineering analysis, design option levels were
ordered based on increasing efficiency (decreased energy and water
consumption) and increasing MSP values. DOE developed four to seven
energy use levels for each equipment class, henceforth referred to as
``efficiency levels,'' through the analysis of engineering design
options. For all equipment classes, efficiency levels were set at
specific intervals--e.g., 10 percent improvement over base energy
usage, 15 percent improvement, 20 percent improvement. The max-tech
efficiency level is the only exception. At the max-tech level, the
efficiency improvement matched the specific levels identified in the
engineering analysis.
The base efficiency level (level 1) in each equipment class is the
least efficient and the least expensive equipment in that class. The
higher efficiency levels (level 2 and higher) exhibit progressive
increases in efficiency and cost with the highest efficiency level
corresponding to the max-tech level. LCC savings and PBP are calculated
for each selected efficiency level of each equipment class.
Many inputs for the LCC analysis are estimated from the best
available data in the market, and in some cases the inputs are
generally accepted values within the industry. In general, each input
value has a range of values associated with it. While single
representative values for each input may yield an output that is the
most probable value for that output, such an analysis does not give the
general range of values that can be attributed to a particular output
value. Therefore, DOE carried out the LCC analysis in the form of Monte
Carlo simulations \37\ in which certain inputs were expressed as a
range of values and probability distributions that account for the
ranges of values that may be typically associated with the respective
input values. The results or outputs of the LCC analysis are presented
in the form of mean LCC savings, percentages of customers experiencing
net savings, net cost and no impact in LCC, and median PBP. For each
equipment class, 10,000 Monte Carlo simulations were carried out. The
simulations were conducted using Microsoft Excel and Crystal Ball, a
commercially available Excel add-in used to carry out Monte Carlo
simulations.
---------------------------------------------------------------------------
\37\ Monte Carlo simulation is, generally, a computerized
mathematical technique that allows for computation of the outputs
from a mathematical model based on multiple simulations using
different input values. The input values are varied based on the
uncertainties inherent to those inputs. The combination of the input
values of different inputs is carried out in a random fashion to
simulate the different probable input combinations. The outputs of
the Monte Carlo simulations reflect the various probable outputs
that are possible due to the uncertainties in the inputs.
---------------------------------------------------------------------------
LCC savings and PBP are calculated by comparing the installed costs
and LCC values of standards-case scenarios against those of base-case
scenarios. The base-case scenario is the scenario in which equipment is
assumed to be purchased by customers in the absence of the proposed
energy conservation standards. Standards-case scenarios are scenarios
in which equipment is assumed to be purchased by customers after the
amended energy conservation standards, determined as part of the
current rulemaking, go into effect. The number of standards-case
scenarios for an equipment class is equal to one less than the total
number of efficiency levels in that equipment class because each
efficiency level above efficiency level 1 represents a potential
amended standard. Usually, the equipment available in the market will
have a distribution of efficiencies. Therefore, for both base-case and
standards-case scenarios, in the LCC analysis, DOE assumed a
distribution of efficiencies in the market, and the distribution was
assumed to be spread across all efficiency levels in the LCC analysis
(see NOPR TSD chapter 10).
[[Page 14893]]
Recognizing that different types of businesses and industries that
use automatic commercial ice makers face different energy prices, and
apply different discount rates to purchase decisions, DOE analyzed
variability and uncertainty in the LCC and PBP results by performing
the LCC and PBP calculations for seven types of businesses: (1) Health
care; (2) lodging; (3) foodservice; (4) retail; (5) education; (6) food
sales; and (7) offices. Different types of businesses face different
energy prices and also exhibit differing discount rates that they apply
to purchase decisions.
Expected equipment lifetime is another input for which it is
inappropriate to use a single value for each equipment class.
Therefore, DOE assumed a distribution of equipment lifetimes that are
defined by Weibull survival functions.\38\
Equipment lifetime is a key input for the LCC and PBP analysis. For
automatic commercial ice maker equipment, there is a general consensus
among industry stakeholders that the typical equipment lifetime is
approximately 7 to 10 years with an average of 8.5 years. There was no
data or comment to suggest that lifetimes are unique to each equipment
class. Therefore, DOE assumed a distribution of equipment lifetimes
that is defined by Weibull \39\ survival functions, with an average
value of 8.5 years.
---------------------------------------------------------------------------
\39\ Weibull survival function is a continuous probability
distribution function that is commonly used to approximate the
distribution of equipment lifetimes.
---------------------------------------------------------------------------
Another factor influencing the LCC analysis is the State in which
the automatic commercial ice maker is installed. Inputs that vary based
on this factor include installation costs, water and energy prices, and
sales tax (plus the associated distribution chain markups). At the
national level, the spreadsheets explicitly modeled variability in the
model inputs for water price, electricity price, and markups using
probability distributions based on the relative populations in all
States.
Detailed descriptions of the methodology used for the LCC analysis,
along with a discussion of inputs and results, are presented in chapter
8 and appendices 8A and 8B of the NOPR TSD.
1. Equipment Cost
To calculate customer equipment costs, DOE multiplied the MSPs
developed in the engineering analysis by the distribution channel
markups, described in section IV.E. DOE applied baseline markups to
baseline MSPs and incremental markups to the MSP increments associated
with higher efficiency levels.
In the preliminary analysis, DOE developed a projection of price
trends for automatic commercial ice maker equipment, indicating that
based on historical price trends the MSP would be projected to decline
by 0.4 percent from the 2012 estimation of MSP values through the 2018
assumed start date of new or amended standards. The preliminary
analysis also indicated an approximately 1.6 percent decline from the
MSP values estimated in 2012 to the end of the 30-year NIA analysis
period used in the preliminary analysis. Price trends generated
considerable discussion during the LCC presentation at the February
2012 preliminary analysis public meeting (and nearly all comments
specific to the NIA were concerning price trends).
Scotsman stated that it typically sees some increase in costs and
that it tries to recapture at least some of the increased cost in the
form of price increases and usually cannot recover all of it. Scotsman
stated that it does not expect to see prices going down over the years
and does not think it makes a lot of sense. Scotsman added that for
household refrigerators and other industries, much of the price
decrease that has been seen over the years is offshored manufacturing.
The automatic commercial ice maker manufacturers do not have the scale
to consider doing that, according to Scotsman. (Scotsman, Public
Meeting Transcript, No. 42 at pp. 127-128) Scotsman analyzed the
historical shipments data and provided graphs showing how different the
forecast would be if a different time period was selected. Scotsman
suggested that a long-term growth trend of 1.5 percent is most
realistic. (Scotsman, No. 46 at pp. 6-7)
NRDC stated that price learning is theoretically expected and
empirically demonstrated, and that it supported DOE's incorporation of
price learning in the rulemaking. (NRDC, No. 48 at p. 2)
AHRI urged DOE to assume that price learning is zero, or in other
words, to hold MSP constant. AHRI stated that it had performed an
analysis of the data used by DOE and that it believed that the data did
not support an assumption of price learning greater than zero. (AHRI,
No. 49 at p. 5 and exhibit A)
Manitowoc stated that there is no real basis to expect that the
manufacturing costs of ice machines will decrease in the future due to
efficiency gains in production because the ice machine designs are
mature and the manufacturing processes are stable. Manitowoc added that
the increase in costs associated with design options is only due to
higher cost components or higher cost material employed and that the
annual production volumes do not allow for further investment in
automation of the manufacturing processes beyond what is already in
place. (Manitowoc, No. 54 at p. 4)
As is customary between the preliminary analysis and the NOPR
phases of a rulemaking, DOE re-examined the data available and updated
the analyses, in this specific instance, the price trend analysis. At a
high level, DOE agrees with the NRDC comment that evidence indicates
price learning is theoretically expected. In response to the AHRI,
Manitowoc, and Scotsman comments that the data do not support the price
trends, DOE re-examined the data used in the analysis, and re-analyzed
price trends with updated data. In the preliminary analysis, DOE used a
Producer Price Index (PPI) that included air-conditioning,
refrigeration, and forced air heating equipment. For the NOPR, DOE was
able to identify a PPI that was a subset of the PPI used for the
preliminary analysis. The subset includes only commercial refrigeration
and related equipment, and excludes unrelated equipment. Using this PPI
for the automatic commercial ice maker price trends analysis yields a
price decline of roughly 1.6 percent over the period of 2012 (the year
for which MSP was estimated) through 2047.
2. Installation, Maintenance, and Repair Costs
a. Installation Costs
Installation cost includes labor, overhead, and any miscellaneous
materials and parts needed to install the equipment. The installation
costs may vary from one equipment class to another, but they typically
do not vary among efficiency levels within an equipment class. Most
automatic commercial ice makers are installed in fairly standard
configurations. For its preliminary analysis, DOE tentatively concluded
that the engineering design options do not impact the installation cost
within an equipment class. DOE therefore assumed that the installation
cost for automatic commercial ice makers does not vary among efficiency
levels within an equipment class. Costs that do not vary with
efficiency levels do not impact the LCC, PBP, or NIA results. In the
preliminary analysis, DOE estimated the installation cost as a fixed
percentage of the total MSP for the baseline efficiency level for a
given equipment class, set at 10 percent.
[[Page 14894]]
Manitowoc agreed with DOE's assumption that installation costs
generally would be unaffected by moving to the higher efficiency level.
However, Manitowoc pointed out that some efficiency differences may
cause variation in installation costs. Manitowoc further explained that
many remote condensers require a crane for installation; therefore,
bigger condensers of automatic commercial ice maker equipment with
higher efficiency levels might result in higher rental and labor costs
associated with the installation. (Manitowoc, Public Meeting
Transcript, No. 42 at p. 136) In its written comments to DOE, Manitowoc
further clarified that higher efficiency equipment would not incur
additional installation costs unless the size of the equipment
increases in such a way as to exceed the industry norms. (Manitowoc,
No. 54 at p. 4) However, Hoshizaki indicated installation costs will
increase with higher levels of energy efficiency due to special
installation requirements for the new machine and possible changes to
the structure that might be required. Furthermore, AHRI commented that
it is incorrect for DOE to assume that changes in installation will be
negligible for more-efficient equipment. (AHRI, No. 49 at p. 5)
Scotsman pointed out that if the technology were assumed to involve
a drain water heat exchange, the installation costs would increase.
(Scotsman, No. 46 at p. 3)
In responses to the comments above, DOE further evaluated the costs
associated with installation and revised the installation cost
estimation methods. For the NOPR, DOE estimated material and labor cost
to install equipment based on RS Means cost estimation data \40\ and on
telephone conservations with contractors. Estimated installation costs
vary by equipment class and by State. DOE decided to continue to assume
installation cost will be constant for all efficiency levels within an
equipment class.
---------------------------------------------------------------------------
\40\ RS Means Company, Inc. 2013 RS Means Electrical Cost Data.
2013. Kingston, MA.
---------------------------------------------------------------------------
In response to Manitowoc's comment that greater equipment size
might result in higher rental and labor costs, DOE notes that while the
initial decision to avoid equipment size increases in the engineering
analysis was eliminated, DOE attempted to minimize equipment size
increases. Thus, proposed standard levels should not add significantly
to labor and crane rental costs. Nor does DOE believe the size
increases would require structural changes as hypothesized by
Hoshizaki. In response to the Manitowoc and Scotsman comments about
drain water heat exchanger installation costs, DOE notes the
promotional material of drain water heat exchanger manufacturers
indicate the units can be installed with four additional water
attachments, a level of effort that would likely not add to the cost of
installations. Finally, in response to Hoshizaki's general statement
that higher efficiency levels will impose specialized installation
requirements, a review of the design options included in the DOE
engineering analysis did not reveal any options likely to impose
specific cost increases. To better respond to the Hoshizaki comment,
DOE requests specificity--which design options will impose increases in
installation costs and what would the magnitude of such cost increases
be?
b. Repair and Maintenance Costs
The repair cost is the average annual cost to the customer for
replacing or repairing components in the automatic commercial ice maker
that have failed. In the preliminary analysis, DOE approximated the
repair cost as a 3-percent fixed percentage of the total baseline MSP
for each equipment class and assumed that repair costs were constant
within an equipment class for all efficiency levels.
Maintenance costs are associated with maintaining the proper
operation of the equipment. The maintenance cost does not include the
costs associated with the replacement or repair of components that have
failed, which are included as repair costs. In the preliminary
analysis, DOE applied a 3-percent preventative maintenance cost that
remains constant across all equipment efficiency levels because data
were not available to indicate how maintenance costs vary with
equipment levels.
Scotsman stated that, in general, whenever new technology is
introduced, failure rates increase. Scotsman stated that when the
failures occur during the warranty period, the cost falls on
manufacturers. Ice makers stress components in ways that they are not
stressed in steady-state machines, according to Scotsman, so even with
well-known technologies it is not known how their failure rates will
fare in ice makers. In addition, Scotsman commented that if the
technology was assumed to involve a drain water heat exchanger, the
maintenance cost would increase. (Scotsman, No. 46 at pp. 3-4)
Likewise, Hoshizaki stated that repair costs are relative to each
machine and that it is difficult to compute a standard average.
Manufacturers are still working to analyze the effects of the 2010
standards on repair costs, according to Hoshizaki. (Hoshizaki, No. 46
at pp. 3-4)
Manitowoc commented that the repair costs will be affected by the
efficiency levels. Manitowoc stated that is has specific concerns about
some components such as motors. Manitowoc pointed out that ECM motors
might enhance the energy efficiencies, but these motors are probably
less reliable than standard permanent split capacitor motors because
ECM motors have more parts. Manitowoc further stated that, in general,
more parts increase the chances that a component will fail, which in
turn potentially increases the repair costs. (Manitowoc, Public Meeting
Transcript, No. 42 at p. 136) In addition, Scotsman stated that
modeling repair cost as a percentage of baseline costs would understate
repair cost. Also using the example of an ECM fan motor, Scotsman
explained that ECM motor has an incremental cost of $35 to install;
however, when it needs to be replaced, it is considerably more costly
than the replacement of the motors that are currently used on the
market. Additionally, Scotsman also noted the ECM fan motor has more
parts than the current motors that are commonly applied in the market,
making it likely to fail more often. Therefore, according to Scotsman,
ECM fan motors might require higher average annual repair costs than
current motors used in the baseline units. (Scotsman, No. 46 at pp. 3-
4) Hoshizaki pointed out higher water and energy efficiency level may
increase maintenance costs. Hoshizaki elaborated that equipment with
lower water usage and improved electrical efficiencies might need more
frequent maintenance such as cleaning. (Hoshizaki, No. 53 at p. 2)
In addition, Howe commented on the impact of new standards on
repairing and maintenance costs. Howe stated that the modification of
new ice makers will cause increased repair and maintenance costs due to
the need to educate service personnel. The percentage of the baseline
costs will increase, according to Howe. (Howe, No. 51 at p. 4)
In response to these comments, DOE evaluated how repair and
maintenance costs were estimated and revised the methodology. For
repair costs, DOE examined the major components of ice makers and
identified expected failure rates for each component. For those
components for which available information indicates a failure might
occur within the expected 8.5-year equipment life, DOE estimated repair
or replacement costs. Under this methodology, repair and replacement
costs are based on the original
[[Page 14895]]
equipment costs, so the more expensive the components are, the greater
the expected repair or replacement cost. For design options modeled in
the engineering analysis, DOE estimated repair costs and if they were
different than the baseline cost, the repair costs were either
increased or decreased accordingly. (Although theoretically possible,
in the case of the ice maker analysis, repair costs did not decrease
with efficiency levels for any equipment class.) Thus, consistent with
Hoshizaki's comment about the difficulty of estimating one standard
average, DOE now estimates different repair and replacement costs for
all equipment classes.
DOE's revision to the repair cost methodology is consistent with
the Manitowoc, Hoshizaki, Scotsman, and Howe comments that repair costs
should increase with efficiency level. Consistent with the Manitowoc
and Scotsman comments, DOE assumed that ECM fan motors would increase
repair costs relative to the baseline. In response to Scotsman's
comments about drain water heat exchangers, DOE notes that manufacturer
literature indicates an expected useful life greater than 8.5 years, so
no replacement was assumed for this component.
In the NOPR analyses, DOE estimated material and labor costs for
preventative maintenance based on RS Means cost estimation data and on
telephone conservations with contractors. DOE assumed maintenance cost
would remain constant for all efficiency levels within an equipment
class. In response to Hoshizaki's comment about the impact of reduced
water usage on maintenance, the DOE analyses for 7 of 12 primary
equipment classes did not involve changes to water usage. In the
remaining 5 (batch) equipment classes, DOE's analysis did not assume
potable water usage would be reduced below 20 gallons per 100 lb ice--a
level manufacturers indicated was a point below which maintenance costs
would increase. (Scotsman, Public Meeting Transcript, No. 42 at p. 64;
Manitowoc, Public Meeting Transcript, No. 42 at p. 65) Thus, for the
NOPR, DOE assumes that maintenance costs will not vary by efficiency
level.
3. Annual Energy and Water Consumption
Chapter 7 of the NOPR TSD details DOE's analysis of annual energy
and water usage at various efficiency levels of automatic commercial
ice makers. Annual energy and water consumption inputs by automatic
commercial ice maker equipment class are based on the engineering
analysis estimates of kilowatt-hours of electricity per 100 lb ice and
gallons of water per 100 lb ice, translated to annual kilowatt-hours
and gallons in the energy and water use analysis (chapter 7 of the NOPR
TSD). The development of energy and water usage inputs is discussed in
section IV.G.6 along with public input and DOE's response to the public
input.
4. Energy Prices
DOE calculated average commercial electricity prices using the EIA
Form EIA-826 data obtained online from the ``Database: Sales
(consumption), revenue, prices & customers'' Web page.\41\ The EIA data
reports average commercial sector retail prices calculated as total
revenues from commercial sales divided by total commercial energy sales
in kilowatt-hours, by State and for the nation. DOE received no
recommendations or suggestions regarding this set of assumptions at the
February 2012 preliminary analysis public meeting or in written
comments.
---------------------------------------------------------------------------
\41\ U.S. Energy Information Administration. Sales and revenue
data by state, monthly back to 1990 (Form EIA-826). (Last accessed
June 26, 2013). www.eia.gov/electricity/data.cfm#sales
---------------------------------------------------------------------------
5. Energy Price Projections
To estimate energy prices in future years for the preliminary
analysis TSD, DOE multiplied the average regional energy prices
described above by the forecast of annual average commercial energy
price indices developed in the Reference Case from AEO2013.\42\ AEO2013
forecasted prices through 2040. To estimate the price trends after
2040, DOE assumed the same average annual rate of change in prices as
exhibited by the forecast over the 2031 to 2040 period. DOE received no
recommendations or suggestions regarding this set of assumptions at the
February 2012 preliminary analysis public meeting or in written
comments.
---------------------------------------------------------------------------
\42\ The spreadsheet tool that DOE used to conduct the LCC and
PBP analyses allows users to select price forecasts from either
AEO's High Economic Growth or Low Economic Growth Cases. Users can
thereby estimate the sensitivity of the LCC and PBP results to
different energy price forecasts.
---------------------------------------------------------------------------
6. Water Prices
To estimate water prices in future years for the preliminary
analysis TSD, DOE used price data from the 2008,\43\ 2010,\44\ and 2012
American Water Works Water (AWWA) and Wastewater Surveys.\45\ The AWWA
2012 survey was the primary data set. No data exists to disaggregate
water prices for individual business types, so DOE varied prices by
state only and not by business type within a state. For each state, DOE
combined all individual utility observations within the state to
develop one value for each state for water and wastewater service.
Since water and wastewater billings are frequently tied to the same
metered commodity values, DOE combined the prices for water and
wastewater into one total dollars per 1,000 gallons figure. DOE used
the Consumer Price Index (CPI) data for water-related consumption
(1973-2012) \46\ in developing a real growth rate for water and
wastewater price forecasts.
---------------------------------------------------------------------------
\43\ American Water Works Association. 2008 Water and Wastewater
Rate Survey. 2009. Denver, CO. Report No. 54004.
\44\ American Water Works Association. 2010 Water and Wastewater
Rate Survey. 2011. Denver, CO. Report No. 54006.
\45\ American Water Works Association. 2012 Water and Wastewater
Rate Survey. 2013. Denver, CO. Report No. 54008.
\46\ The Bureau of Labor Statistics defines CPI as a measure of
the average change over time in the prices paid by urban consumers
for a market basket of consumer goods and services. For more
information see www.bls.gov/cpi/home.htm.
---------------------------------------------------------------------------
During the public meeting and in written comments, stakeholders
commented on the water prices DOE used in its LCC analysis. NPCC stated
that water and wastewater price escalation has been systematically
higher than the CPI. Further, NPCC pointed out that EPA's water-related
regulations governed by the Clean Water Act might level out the
escalation rates once the regulations' requirements were satisfied,
even though NPCC does not anticipate the escalation rates will diminish
much. Given the impact of EPA's latest water-related regulations was
not completed, NPCC then raised the question whether DOE should use
both a higher escalation rate and CPI in its analysis. NPCC then
suggested using a higher escalated rate in the analysis for a short-run
period until the effective date of EPA's latest water-related
regulations and move to the CPI for the longer term analysis starting
with the effective date of EPA's relevant regulations. (NPCC, Public
Meeting Transcript, No, 42 at pp. 132-134) In addition, the Alliance
argued that water use and energy use cannot be compared on a simple
price basis because of key differences between the two resources. The
Alliance stated that, first, energy comes from multiple sources and is
a commodity whose prices fluctuate based on supply and demand.
Freshwater, on the other hand, is in limited supply and water prices
are heavily regulated based on the cost of treatment and delivery,
which is less directly affected by supply and demand, according to the
Alliance. The Alliance
[[Page 14896]]
further stated that when water demand overcomes the readily available
fresh water resources in the U.S., the alternative water sources will
likely require more costly infrastructure and operational changes such
as desalination to fulfill the demand for fresh water, which is also a
very energy intensive process. Therefore, the Alliance recommended that
DOE consider the marginal costs of alternative water sources, such as
desalination, in its analyses to properly account for all water costs
as applied to water-cooled condensers. (Alliance, No. 45 at p. 4)
DOE appreciates the comments that EPA water regulations under the
Clean Water Act may impact the escalation rate of water price used in
DOE's analysis and the observation about desalination plants being the
next source of water available in many localities. With respect to the
Clean Water Act comment, DOE notes that the Clean Water Act has been in
existence since 1972. Thus, the water price trends should include the
impacts of historical costs attributable to the Clean Water Act.
Throughout that entire period, the CPI for water utility costs grew at
an average rate of 1.6 percent faster than the total CPI, perhaps
validating the NPCC point. As for capturing the effects of unknown
future EPA regulations, DOE considers this a speculative effort, and
DOE has long adhered to a guiding principle that the analyses avoid
speculating in this fashion. With respect to the comment about
desalination and the accompanying suggestion that DOE should use
marginal water prices, DOE has developed water prices using recent
water price data, which would include resource costs that underlie the
provision of water. Looking forward, DOE acknowledges that new water
resources brought online in future years may differ from those of the
past, but DOE has not identified a source that carefully and
systematically forecasts the impact of future developments of this
nature, as the AEO2013 does in the case of electricity. Thus, to
attempt to project growth rates for 50 states to capture these resource
changes would be speculative. Rather than speculate, DOE has updated
the calculation of State-level water prices with the inclusion of the
2012 AWWA survey \47\ and additional consumer price index values.
---------------------------------------------------------------------------
\47\ American Water Works Association. 2012 Water and Wastewater
Rate Survey. 2013. Denver, CO. Report No. 54008.
---------------------------------------------------------------------------
7. Discount Rates
The discount rate is the rate at which future expenditures are
discounted to establish their present value. DOE determined the
discount rate by estimating the cost of capital for purchasers of
automatic commercial ice makers. Most purchasers use both debt and
equity capital to fund investments. Therefore, for most purchasers, the
discount rate is the weighted average cost of debt and equity
financing, or the weighted average cost of capital (WACC), less the
expected inflation.
To estimate the WACC of automatic commercial ice maker purchasers,
DOE used a sample of nearly 1,200 companies grouped to be
representative of operators of each of the commercial business types
(health care, lodging, foodservice, retail, education, food sales, and
offices) drawn from a database of 6,177 U.S. companies presented on the
Damodaran Online Web site.\48\ This database includes most of the
publicly-traded companies in the United States. The WACC approach for
determining discount rates accounts for the current tax status of
individual firms on an overall corporate basis. DOE did not evaluate
the marginal effects of increased costs, and, thus, depreciation due to
more expensive equipment, on the overall tax status.
---------------------------------------------------------------------------
\48\ Damodaran financial data is available at: https://
pages.stern.nyu.edu/~adamodar/ (Last accessed January 31, 2013).
---------------------------------------------------------------------------
DOE used the final sample of companies to represent purchasers of
automatic commercial ice makers. For each company in the sample, DOE
combined company-specific information from the Damodaran Online Web
site, long-term returns on the Standard & Poor's 500 stock market index
from the Damodaran Online Web site, nominal long-term Federal
government bond rates, and long-term inflation to estimate a WACC for
each firm in the sample.
For most educational buildings and a portion of the office
buildings and cafeterias occupied and/or operated by public schools,
universities, and State and local government agencies, DOE estimated
the cost of capital based on a 40-year geometric mean of an index of
long-term tax-exempt municipal bonds (>20 years).49 50
Federal office space was assumed to use the Federal bond rate, derived
as the 40-year geometric average of long-term (>10 years) U.S.
government securities.\51\
---------------------------------------------------------------------------
\49\ Federal Reserve Bank of St. Louis, State and Local Bonds--
Bond Buyer Go 20-Bond Municipal Bond Index. (Last accessed April 6,
2012). Annual data for 1973-2011 was available at: https://research.stlouisfed.org/fred2/series/MSLB20/downloaddata?cid=32995).
\50\ Rate for 2012 calculated from monthly data. Data source:
U.S. Federal Reserve (Last accessed February 20, 2013) (Available
at: www.federalreserve.gov/releases/h15/data.htm).
\51\ Rate calculated with 1973-2012 data. Data source: U.S.
Federal Reserve (Last accessed February 20, 2013) (Available at:
www.federalreserve.gov/releases/h15/data.htm).
---------------------------------------------------------------------------
DOE recognizes that within the business types purchasing automatic
commercial ice makers there will be small businesses with limited
access to capital markets. Such businesses tend to be viewed as higher
risk by lenders and face higher capital costs as a result. To account
for this, DOE included an additional risk premium for small businesses.
The premium, 1.9 percent, was developed from information found on the
Small Business Administration Web site.\52\
---------------------------------------------------------------------------
\52\ Small Business Administration data on loans between $10,000
and $99,000 compared to AAA Corporate Rates. <https://www.sba.gov/advocacy/7540/6282> Data last accessed on June 10, 2013.
---------------------------------------------------------------------------
Chapter 8 of the TSD provides more information on the derivation of
discount rates. The average discount rate by business type is shown on
Table IV.26.
Table IV.26--Average Discount Rate by Business Type
------------------------------------------------------------------------
Average
Business type discount rate
(real) (%)
------------------------------------------------------------------------
Health Care............................................ 2.7
Lodging................................................ 6.8
Foodservice............................................ 5.8
Retail................................................. 4.6
Education.............................................. 3.0
Food Sales............................................. 5.1
Office................................................. 4.6
------------------------------------------------------------------------
8. Lifetime
DOE defines lifetime as the age at which typical automatic
commercial ice maker equipment is retired from service. DOE estimated
equipment lifetime based on its discussion with industry experts, and
concluded a typical lifetime of 8.5 years. AHRI agreed with DOE's
proposed average equipment lifetime of 8.5 years. (Alliance, No. 49 at
p. 5) Hoshizaki agreed that 8.5 years is a fair assumption for
commercial cube type ice makers. However, Hoshizaki stated that
continuous type ice makers might have a shorter life. (Hoshizaki, No.
53 at p. 2)
For the NOPR analyses, DOE elected to use an 8.5-year average life
for all equipment classes. With regard to the Hoshizaki statement that
continuous type ice makers might have shorter life spans, DOE requests
specific information to assist in determining whether continuous and
batch type equipment should be analyzed using differing assumptions for
equipment
[[Page 14897]]
life. All literature on the subject of ice maker lifetimes reviewed by
DOE, including comments received during the Framework phase of this
rulemaking, indicates a 7 to 10 year life, with 8.5 years being a
reasonable average. DOE therefore is proposing in this NOPR to use 8.5
years as automatic commercial ice maker lifetime for DOE's LCC analysis
for covered automatic commercial ice maker equipment, but would welcome
additional data concerning specific differences between equipment
classes.
9. Compliance Date of Standards
EPCA prescribes that DOE must review and determine whether to amend
performance-based standards for cube type automatic commercial ice
makers by January 1, 2015. (42 U.S.C. 6313(d)(3)(A)) In addition, EPCA
requires that the amended standards established in this rulemaking must
apply to equipment that is manufactured on or after 3 years after the
final rule is published in the Federal Register unless DOE determines,
by rule, that a 3-year period is inadequate, in which case DOE may
extend the compliance date for that standard by an additional 2 years.
(42 U.S.C. 6313(d)(3)(C)) DOE began this rulemaking with the
expectation of completing it prior to the January 1, 2015 required
date, and, therefore, assumed during the preliminary analysis that new
and amended standards would take effect in 2016. However, for the NOPR
analyses, based on the January 1, 2015 statutory deadline and giving
manufacturers 3 years to meet the new and amended standards, DOE
assumes that the most likely compliance date for the standards set by
this rulemaking would be January 1, 2018. Therefore, DOE calculated the
LCC and PBP for automatic commercial ice makers under the assumption
that compliant equipment would be purchased in 2018, the year when
compliance with the amended standard is required. DOE requests comments
on the January 1, 2018 effective date.
10. Base-Case and Standards-Case Efficiency Distributions
To estimate the share of affected customers who would likely be
impacted by a standard at a particular efficiency level, DOE's LCC
analysis considers the projected distribution of efficiencies of
equipment that customers purchase under the base case (that is, the
case without new energy efficiency standards). DOE refers to this
distribution of equipment efficiencies as a base-case efficiency
distribution.
DOE's methodology to estimate market shares of each efficiency
level within each equipment class is based on an analysis of the
automatic commercial ice makers currently available for purchase by
customers. DOE analyzed all available models, calculated the percentage
difference between the baseline energy usage embodied in the ice maker
rulemaking analyses, and organized the available units by the
efficiency levels. DOE then calculated the percentage of available
models falling within each efficiency level bin. This efficiency
distribution was used in the LCC and other downstream analyses as the
baseline efficiency distribution.
11. Inputs to Payback Period Analysis
Payback period is the amount of time it takes the customer to
recover the higher purchase cost of more energy-efficient equipment as
a result of lower operating costs. Numerically, the PBP is the ratio of
the increase in purchase cost to the decrease in annual operating
expenditures. This type of calculation is known as a ``simple'' PBP
because it does not take into account changes in operating cost over
time (i.e., as a result of changing cost of electricity) or the time
value of money; that is, the calculation is done at an effective
discount rate of zero percent. PBPs are expressed in years. PBPs
greater than the life of the equipment mean that the increased total
installed cost of the more-efficient equipment is not recovered in
reduced operating costs over the life of the equipment, given the
conditions specified within the analysis such as electricity prices.
The inputs to the PBP calculation are the total installed cost to
the customer of the equipment for each efficiency level and the average
annual operating expenditures for each efficiency level in the first
year. The PBP calculation uses the same inputs as the LCC analysis,
except that discount rates are not used.
12. Rebuttable Presumption Payback Period
EPCA (42 U.S.C. 6295(o)(2)(B)(iii) and 6313(d)(4)) established a
rebuttable presumption that a new or amended standards are economically
justified if the Secretary finds that the additional cost to the
consumer of purchasing a product complying with an energy conservation
standard level will be less than three times the value of the energy
savings during the first year that the consumer will receive as a
result of the standard, as calculated under the applicable test
procedure.
While DOE examined the rebuttable presumption criterion, it
considered whether the standard levels considered are economically
justified through a more detailed analysis of the economic impacts of
these levels pursuant to 42 U.S.C. 6295(o)(2)(B)(iii) 6313(d)(4). The
results of this analysis served as the basis for DOE to evaluate the
economic justification for a potential standard level definitively
(thereby supporting or rebutting the results of any preliminary
determination of economic justification).
H. National Impact Analysis--National Energy Savings and Net Present
Value
The NIA assesses the NES and the NPV of total customer costs and
savings that would be expected as a result of the amended energy
conservation standards. The NES and NPV are analyzed at specific
efficiency levels (i.e., TSL) for each equipment class of automatic
commercial ice makers. DOE calculates the NES and NPV based on
projections of annual equipment shipments, along with the annual energy
consumption and total installed cost data from the LCC analysis. For
the NOPR analysis, DOE forecasted the energy savings, operating cost
savings, equipment costs, and NPV of customer benefits for equipment
sold from 2018 through 2047--the year in which the last standards-
compliant equipment is shipped during the 30-year analysis.
DOE evaluates the impacts of the amended standards by comparing
base-case projections with standards-case projections. The base-case
projections characterize energy use and customer costs for each
equipment class in the absence of any amended energy conservation
standards. DOE compares these base-case projections with projections
characterizing the market for each equipment class if DOE adopted the
amended standards at each TSL. For the standards cases, DOE assumed a
``roll-up'' scenario in which equipment at efficiency levels that do
not meet the standard level under consideration would ``roll up'' to
the efficiency level that just meets the proposed standard level, and
equipment already being purchased at efficiency levels at or above the
proposed standard level would remain unaffected.
DOE uses a Microsoft Excel spreadsheet model to calculate the
energy savings and the national customer costs and savings from each
TSL. The NOPR TSD and other documentation that DOE provides during the
rulemaking help explain the models and how to use them, and interested
parties can review DOE's analyses by interacting with these
spreadsheets. The NIA spreadsheet model uses average values as inputs
(as opposed to probability distributions of
[[Page 14898]]
key input parameters from a set of possible values).
For the current analysis, the NIA used projections of energy prices
and commercial building starts from the AEO2013 Reference Case. In
addition, DOE analyzed scenarios that used inputs from the AEO2013 Low
Economic Growth and High Economic Growth Cases. These cases have lower
and higher energy price trends, respectively, compared to the Reference
Case. NIA results based on these cases are presented in chapter 10 of
the NOPR TSD.
A detailed description of the procedure to calculate NES and NPV,
and inputs for this analysis, are provided in chapter 10 of the NOPR
TSD.
1. Shipments
DOE obtained data from AHRI and U.S. Census Bureau's Current
Industrial Reports (CIR) to estimate historical shipments for automatic
commercial ice makers. AHRI provided DOE with automatic commercial ice
maker shipment data for 2010 describing the distribution of shipments
by equipment class and by harvest capacity. AHRI's data to DOE also
included a 11-year history of total shipments from 2000 to 2010.
Additionally, DOE collected total automatic commercial ice maker
shipment data for the period of 1973 to 2009 from the CIR. DOE reviewed
the total shipments in the AHRI and CIR data, and noted that the CIR-
reported shipments were consistently higher than the AHRI-reported
shipments. DOE considered the possibility that these discrepancies were
associated with net exports. However, the CIR data presented exports as
a percentage of total production at a high level of industry
aggregation, thus making it impossible to identify ice maker exports as
a percentage of ice maker production. DOE requested input to aid in
understanding the differences between the AHRI and CIR shipments data.
DOE identified one source with identifiable export information, the
North American Association of Food Equipment Manufacturers (NAFEM).
NAFEM data for two recent calendar years (2007 and 2008) showed
approximately 20 percent of total ice maker shipments associated with
food service equipment as exports. Applying a 20 percent export factor
to the CIR shipments data brought the CIR data into approximate
agreement with the AHRI data.
For the preliminary analysis, DOE relied on the CIR shipment
values, reduced 20 percent for exports. Using adjusted CIR data, DOE
created a rolling estimate of total existing stock by aggregating
historical shipments across 8.5-year historical periods. DOE used the
CIR data to estimate a time series of shipments and total stock for
1994 to 2006--at the time of the analysis, the last year of data
available without significant gaps in the data due to disclosure
limitations. For each year, using shipments, stock, and the estimated
8.5-year life of the equipment, DOE estimated that, on average, 14
percent of shipments were for new installations and the remainder for
replacement of existing stock.
DOE then combined the historical shipments, disaggregated between
shipments for new installations and those for replacement of existing
stock, and the historical stock values with projections of new
construction activity from AEO2011 to generate a forecast of shipments.
Stock and shipments were first disaggregated to individual business
types based on data developed for DOE on commercial ice maker
stocks.\53\ The business types and share of stock represented by each
type are shown in Table IV.27. Using a Weibull distribution assuming
equipment has an average life of 8.5 years and lasts from 5 to 11
years, DOE developed a 30-year series of replacement ice maker
shipments. Using the base shipments to new equipment, and year-to-year
changes in new commercial sector floor space additions from AEO2011,
DOE estimated shipments for new construction. (For the NOPR, DOE is
using AEO2013 projections of floor space additions. The AEO2013 floor
space additions by building type are shown in Table IV.28.) The
combination of the replacement and new construction shipments yields
total shipments. The final step was to distribute total sales to
equipment classes by multiplying the total shipments by percentage
shares by class. Table IV.29 shows the percentages represented by all
equipment classes, both the primary classes modeled explicitly in all
NOPR analyses as well as the secondary classes.
---------------------------------------------------------------------------
\53\ Navigant Consulting, Inc. Energy Savings Potential and R&D
Opportunities for Commercial Refrigeration. Final Report, submitted
to the U.S. Department of Energy. September 23, 2009. Page 41.
Table IV.27--Business Types Included in Shipments Analysis
------------------------------------------------------------------------
Building type
Building type as percent of
stock (%)
------------------------------------------------------------------------
Health Care............................................ 9
Lodging................................................ 33
Foodservice............................................ 22
Retail................................................. 8
Education.............................................. 7
Food Sales............................................. 16
Office................................................. 4
----------------
Total.............................................. 100
------------------------------------------------------------------------
Table IV.28--AEO2013 Forecast of New Building Square Footage
--------------------------------------------------------------------------------------------------------------------------------------------------------
New construction
---------------------------------------------------------------------------------------------------------------
Year million ft \2\
---------------------------------------------------------------------------------------------------------------
Health care Lodging Foodservice Retail Education Food sales Office
--------------------------------------------------------------------------------------------------------------------------------------------------------
2013.................................... 66 147 30 276 247 21 173
2018.................................... 67 164 50 424 208 35 409
2020.................................... 65 178 48 407 197 33 452
2025.................................... 63 181 48 442 169 33 392
2030.................................... 71 150 54 508 191 38 273
2035.................................... 73 207 56 522 228 39 412
2040.................................... 76 190 56 562 252 39 405
Annual Growth Factor, 2031-2040......... 2.4% 2.5% 2.4% 2.5% 1.7% 2.3% 2.1%
--------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 14899]]
Table IV.29--Percent of Shipped Units of Automatic Commercial Ice Makers
------------------------------------------------------------------------
Percentage of
Equipment class shipments
------------------------------------------------------------------------
IMH-W-Small-B........................................... 4.54
IMH-W-Med-B............................................. 2.90
IMH-W-Large-B........................................... 0.48
IMH-A-Small-B........................................... 27.08
IMH-A-Large-B........................................... 16.14
RCU-Small-B............................................. 5.43
RCU-RC/NC-Large-B....................................... 6.08
SCU-W-Small-B........................................... 0.68
SCU-W-Large-B........................................... 0.22
SCU-A-Small-B........................................... 13.85
SCU-A-Large-B........................................... 6.56
IMH-W-Small-C........................................... 0.68
IMH-W-Large-C........................................... 0.17
IMH-A-Small-C........................................... 3.53
IMH-A-Large-C........................................... 1.07
RCU-Small-C............................................. 0.83
RCU-Large-C............................................. 0.87
SCU-W-Small-C........................................... 0.15
SCU-W-Large-C........................................... 0.00
SCU-A-Small-C........................................... 8.75
SCU-A-Large-C........................................... 0.00
---------------
Total............................................... 100.00
------------------------------------------------------------------------
Source: AHRI, 2010 Shipments data submitted to DOE as part of this
rulemaking.
Comments related to shipment analysis received during the February
2012 preliminary analysis public meeting are listed below along with
DOE's responses to the comments.
AHRI, in response to DOE's question about inconsistencies between
AHRI and CIR data, indicated it has found discrepancies and that these
discrepancies relate to the way manufacturers report to the Census
Bureau. AHRI stated that some residential ice makers may be lumped into
the Census Bureau data. AHRI stated that it is confident in its data
and would trust it as compared to the Census Bureau data. (AHRI, Public
Meeting Transcript, No. 42 at p. 155) AHRI commented that it believes
the historical shipments numbers it provided to DOE are more consistent
in terms of product definitions and other factors than the Census
Bureau shipments. (AHRI, No. 49 at p. 6) In response to a question by
NPCC, Manitowoc indicated that while the automatic commercial ice
makers market was still a little below historical levels, it was
recovered from 2009. Manitowoc stated the product mix calculated by DOE
is a ``pretty good'' snapshot, but there are shifts over time between
batch and continuous types. (Manitowoc, Public Meeting Transcript, No.
42 at p. 147) Howe recommended using the Census Bureau shipments data
because it is more encompassing. (Howe, No. 51 at p. 4) Hoshizaki
stated AHRI shipment data could be skewed by models not sold in AHRI
model class or manufacturers that do not participate with AHRI, but
more information is needed to evaluate this issue. (Hoshizaki, No. 53
at p. 2)
In response to AHRI's comments about the known consistency of the
AHRI data versus the less-well-known consistency of the Census Bureau
data, DOE elected to use the AHRI historical data for the DOE Reference
Case projections. As noted by Howe and Hoshizaki, the Census Bureau
data could reflect broader coverage of all manufacturers. Thus, DOE
configured the NIA model such that consistent scenarios can be modeled
with either AHRI or Census Bureau data. With respect to the Manitowoc
comments, DOE appreciates that the product mix represents a good
snapshot. With respect to changing the mix, DOE requests additional
data concerning trends, in the absence of which, DOE will by necessity
hold the product mix static in the forecast.
2. Forecasted Efficiency in the Base Case and Standards Cases
The method for estimating the market share distribution of
efficiency levels is presented in section IV.G.10, and a detailed
description can be found in chapter 10 of the NOPR TSD. To estimate
efficiency trends in the standards cases, DOE uses a ``roll-up''
scenario in its standards rulemakings. Under the roll-up scenario, DOE
assumes that equipment efficiencies in the base case that do not meet
the standard level under consideration would ``roll up'' to the
efficiency level that just meets the proposed standard level and
equipment already being purchased at efficiencies at or above the
standard level under consideration would be unaffected. Table IV.30
shows the shipment-weighted market shares by efficiency level in the
base-case scenario.
Table IV.30--Shipment-Weighted Market Shares by Efficiency Level, Base Case
--------------------------------------------------------------------------------------------------------------------------------------------------------
Market share by efficiency level
Equipment class ---------------------------------------------------------------------------------------------------------------
Level 1 (%) Level 2 (%) Level 3 (%) Level 4 (%) Level 5 (%) Level 6 (%) Level 7 (%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
IMH-W-Small-B........................... 39.1 26.1 23.9 10.9 0.0 0.0 ..............
IMH-W-Med-B............................. 69.0 16.7 11.9 0.0 2.4 .............. ..............
IMH-W-Large-B
IMH-W-Large-B-1..................... 71.4 0.0 4.8 23.8 .............. .............. ..............
IMH-W-Large-B-2..................... 33.3 50.0 0.0 16.7 .............. .............. ..............
IMH-A-Small-B........................... 37.0 31.5 25.9 5.6 0.0 0.0 0.0
IMH-A-Large-B
IMH-A-Large-B-1..................... 41.5 43.9 7.3 7.3 0.0 0.0 ..............
IMH-A-Large-B-2..................... 33.3 26.7 26.7 13.3 .............. .............. ..............
RCU-Large-B
RCU-Large-B-1....................... 42.9 39.3 8.9 0.0 8.9 .............. ..............
RCU-Large-B-2....................... 27.3 45.5 9.1 0.0 18.2 .............. ..............
SCU-W-Large-B........................... 28.6 0.0 14.3 0.0 42.9 0.0 14.3
SCU-A-Small-B........................... 17.1 40.0 5.7 11.4 14.3 11.4 0.0
SCU-A-Large-B........................... 28.6 35.7 0.0 7.1 21.4 7.1 0.0
IMH-A-Small-C........................... 22.9 22.9 14.3 8.6 17.1 2.9 11.4
IMH-A-Large-C........................... 35.0 20.0 15.0 15.0 0.0 5.0 10.0
SCU-A-Small-C........................... 26.7 20.0 16.7 13.3 3.3 20.0 ..............
--------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 14900]]
3. National Energy Savings
For each year in the forecast period, DOE calculates the NES for
each TSL by multiplying the stock of equipment affected by the energy
conservation standards by the estimated per-unit annual energy savings.
DOE typically considers the impact of a rebound effect, introduced in
the energy use analysis, in its calculation of NES for a given product.
A rebound effect occurs when users operate higher efficiency equipment
more frequently and/or for longer durations, thus offsetting estimated
energy savings. When a rebound effect occurs, it is generally because
the users of the equipment perceive it as less costly to use the
equipment and elect to use it more intensively. In the case of
automatic commercial ice makers, users of the equipment include
restaurant wait staff, hotel guests, cafeteria patrons, or hospital
staff using ice in the treatment of patients. Users of automatic
commercial ice makers tend to have no perception of the cost of the
ice, and rather are using the ice to serve a specific need. Given this,
DOE believes there is no potential for a rebound effect. For the
preliminary analysis, DOE used a rebound factor of 1, or no effect, for
automatic commercial ice makers.
Inputs to the calculation of NES are annual unit energy
consumption, shipments, equipment stock, and a site-to-source
conversion factor.
The annual unit energy consumption is the site energy consumed by
an automatic commercial ice maker unit in a given year. Using the
efficiency of units at each efficiency level and the baseline
efficiency distribution, DOE determined annual forecasted shipment-
weighted average equipment efficiencies that, in turn, enabled
determination of shipment-weighted annual energy consumption values.
The automatic commercial ice makers stock in a given year is the
total number of automatic commercial ice makers shipped from earlier
years (up to 12 years earlier) that remain in use in that year. The NES
spreadsheet model keeps track of the total units shipped each year. For
purposes of the NES and NPV analyses in the NOPR analysis, DOE assumed
that, based on an 8.5-year average equipment lifetimes, approximately
12 percent of the existing automatic commercial ice makers are retired
and replaced in each year. DOE assumes that, for units shipped in 2047,
any units still remaining at the end of 2055 will be replaced.
DOE uses a multiplicative factor called ``site-to-source conversion
factor'' to convert site energy consumption (at the commercial
building) into primary or source energy consumption (the energy at the
energy generation site required to convert and deliver the site
energy). These site-to-source conversion factors account for the energy
used at power plants to generate electricity and losses in transmission
and distribution, as well as for natural gas losses from pipeline
leakage and energy used for pumping. For electricity, the conversion
factors vary over time due to projected changes in generation sources
(that is, the power plant types projected to provide electricity to the
country). The factors that DOE developed are marginal values, which
represent the response of the system to an incremental decrease in
consumption associated with amended energy conservation standards.
In the preliminary analysis, DOE used annual site-to-source
conversion factors based on the version of the National Energy Modeling
System (NEMS) that corresponds to AEO2008.\54\ For today's NOPR, DOE
updated its conversion factors based on the U.S. energy sector modeling
using the NEMS Building Technologies (NEMS-BT) version that corresponds
to AEO2013 and which provides national energy forecasts through 2040.
Within the results of NEMS-BT model runs performed by DOE, a site-to-
source ratio for commercial refrigeration was developed. The site-to-
source ratio was extended beyond 2040 by using growth rates calculated
at 5-year intervals to extrapolate the trend to 2045, after which it
was held constant through the end of the analysis period (30-years plus
the life of equipment).
---------------------------------------------------------------------------
\54\ In the past for preliminary analysis estimates, DOE
typically did not perform analyses using NEMS. Rather, DOE relied on
existing estimates considered appropriate for the analysis. The
site-to-source values DOE considered most appropriate were those
used in the prior 2009 commercial refrigeration equipment rulemaking
final rule.
---------------------------------------------------------------------------
DOE has historically presented NES in terms of primary energy
savings. In response to the recommendations of a committee on ``Point-
of-Use and Full-Fuel-Cycle Measurement Approaches to Energy Efficiency
Standards'' appointed by the National Academy of Science, DOE announced
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 (August 18, 2011) 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 a
statement of amended policy in the Federal Register in which DOE
explained its determination that NEMS is a more appropriate tool for
its FFC analysis and its intention to use NEMS for that purpose. 77 FR
49701 (August 17, 2012). DOE received one comment, which was supportive
of the use of NEMS for DOE's FFC analysis.\55\
---------------------------------------------------------------------------
\55\ Docket ID: EERE-2010-BT-NOA0028, comment by Kirk Lundblade.
---------------------------------------------------------------------------
The approach used for today's NOPR, and the FFC multipliers that
were applied are described in appendix 10D of the NOPR TSD. NES results
are presented in both primary and in terms of FFC savings; the savings
by TSL are summarized in terms of FFC savings in section V.B.3.
4. Net Present Value of Customer Benefit
The inputs for determining the NPV of the total costs and benefits
experienced by customers of the automatic commercial ice makers are:
(1) total annual installed cost; (2) total annual savings in operating
costs; and (3) a discount factor. DOE calculated net national savings
for each year as the difference in installation and operating costs
between the base-case scenario and standards-case scenarios. DOE
calculated operating cost savings over the life of each piece of
equipment shipped in the forecast period.
DOE multiplied monetary values in future years by the discount
factor to determine the present value of costs and savings. DOE
estimated national impacts with both a 3-percent and a 7-percent real
discount rate as the average real rate of return on private investment
in the U.S. economy. These discount rates are used in accordance with
the Office of Management and Budget (OMB) guidance to Federal agencies
on the development of regulatory analysis (OMB Circular A-4, September
17, 2003), and section E, ``Identifying and Measuring Benefits and
Costs,'' therein. DOE defined the present year as 2013 for the NOPR
analysis. The 7-percent real value is an estimate of the average
before-tax rate of return to private capital in the U.S. economy. The
3-percent real value represents the ``societal rate of time
preference,'' which is the rate at which society discounts future
consumption flows to their present.
As discussed in IV.G.1, DOE included a projection of price trends
in the
[[Page 14901]]
preliminary analysis NIA. For the NOPR, DOE reviewed and updated the
analysis with the result that the projected reference case downward
trend in prices is quite modest. For the NOPR, DOE also developed high
and low case price trend projections, as discussed in a NOPR TSD
appendix to chapter 10.
I. Customer Subgroup Analysis
In analyzing the potential impact of new or amended standards on
commercial customers, DOE evaluates the impact on identifiable groups
(i.e., subgroups) of customers, such as different types of businesses
that may be disproportionately affected. Based on the data available to
DOE, automatic commercial ice maker ownership in three building types
represent over 70 percent of the market: food sales, foodservice, and
hotels. Based on data from the 2007 U.S. Economic Census and size
standards set by the U.S. Small Business Administration (SBA), DOE
determined that a majority of food sales, foodservice and lodging firms
fall under the definition of small businesses. Small businesses
typically face a higher cost of capital. In general, the lower the cost
of electricity and higher the cost of capital, the more likely it is
that an entity would be disadvantaged by the requirement to purchase
higher efficiency equipment. Chapter 8 of the NOPR TSD presents the
electricity price by business type and discount rates by building
types, respectively, while chapter 11 discusses these topics as they
specifically relate to small businesses.
Comparing the foodservice, food sales, and lodging categories,
foodservice faces the highest energy price, with food sales and lodging
facing lower and nearly the same energy prices. Lodging faces the
highest cost of capital. Foodservice faces a higher cost of capital
than food sales. Given the cost of capital disparity, lodging was
selected for LCC subgroup analysis. With foodservice facing a higher
cost of capital, it was selected for subgroup analysis because the
higher cost of capital should lead foodservice customers to value first
cost more and future electricity savings less than would be the case
for food sales customers.
At the February 2012 preliminary analysis public meeting, DOE asked
for input on the LCC subgroup analysis, and in particular, about
appropriate groups for analysis. Manitowoc recommended that DOE look at
small businesses, such as franchise operations and independent
proprietor-run establishments. Manitowoc added that while there are
institutional sectors with longer windows, there are others--``mom and
pops''--that represent a large part of the market and which may be
unfairly impacted by new standards because of their short payback
windows and cash constraints. Manitowoc also indicated it is not just
restaurants, it is hotels operated by franchisees and in some cases
even hotel chains. (Manitowoc, Public Meeting Transcript, No. 42 at p.
169)
DOE estimated the impact on the identified customer subgroups using
the LCC spreadsheet model. The standard LCC and PBP analyses (described
in section IV.G) include various types of businesses that use automatic
commercial ice makers. For the LCC subgroup analysis, it was assumed
that the subgroups analyzed do not have access to national purchasing
accounts or two major capital markets thereby making the discount rates
higher for these subgroups. Details of the data used for LCC subgroup
analysis and results are presented in chapter 11 of the NOPR TSD.
J. Manufacturer Impact Analysis
1. Overview
DOE performed an MIA to estimate the impacts of amended energy
conservation standards on manufacturers of automatic commercial ice
makers. The MIA has both quantitative and qualitative aspects and
includes analyses of forecasted industry cash flows, the INPV,
investments in research and development (R&D) and manufacturing
capital, and domestic manufacturing employment. Additionally, the MIA
seeks to determine how amended energy conservation standards might
affect manufacturing employment, capacity, and competition, as well as
how standards contribute to overall regulatory burden. Finally, the MIA
serves to identify any disproportionate impacts on manufacturer
subgroups, in particular, small businesses.
The quantitative part of the MIA primarily relies on the Government
Regulatory Impact Model (GRIM), an industry cash flow model with inputs
specific to this rulemaking. The key GRIM inputs include data on the
industry cost structure, unit production costs, product shipments,
manufacturer markups, and investments in R&D and manufacturing capital
required to produce compliant products. The key GRIM outputs are the
INPV, which is the sum of industry annual cash flows over the analysis
period, discounted using the industry weighted average cost of capital,
and the impact to domestic manufacturing employment. The model
estimates the impacts of more-stringent energy conservation standards
on a given industry by comparing changes in INPV and domestic
manufacturing employment between a base case and the various TSLs in
the standards case. To capture the uncertainty relating to manufacturer
pricing strategy following amended standards, the GRIM estimates a
range of possible impacts under different markup scenarios.
The qualitative part of the MIA addresses manufacturer
characteristics and market trends. Specifically, the MIA considers such
factors as manufacturing capacity, competition within the industry, the
cumulative impact of other DOE and non-DOE regulations, and impacts on
small business manufacturers. The complete MIA is outlined in chapter
12 of the NOPR TSD.
DOE conducted the MIA for this rulemaking in three phases. In Phase
1 of the MIA, DOE prepared a profile of the automatic commercial ice
maker industry. This included a top-down cost analysis of automatic
commercial ice maker manufacturers that DOE used to derive preliminary
financial inputs for the GRIM (e.g., revenues; materials, labor,
overhead, and depreciation expenses; selling, general, and
administrative expenses (SG&A); and R&D expenses). DOE also used public
sources of information to further calibrate its initial
characterization of the automatic commercial ice maker industry,
including company Securities and Exchange Commission (SEC) 10-K
filings, corporate annual reports, the U.S. Census Bureau's Economic
Census, and reports from Dunn & Bradstreet.
In Phase 2 of the MIA, DOE prepared a framework industry cash flow
analysis to quantify the impacts of new and amended energy conservation
standards. The GRIM uses several factors to determine a series of
annual cash flows starting with the announcement of the standard and
extending over a 30-year period following the effective date of the
standard. These factors include annual expected revenues, costs of
sales, SG&A and R&D expenses, taxes, and capital expenditures. In
general, energy conservation standards can affect manufacturer cash
flow in three distinct ways: (1) create a need for increased
investment; (2) raise production costs per unit; and (3) alter revenue
due to higher per-unit prices and changes in sales volumes.
In addition, during Phase 2, DOE developed interview guides to
distribute to manufacturers of automatic commercial ice makers in order
to
[[Page 14902]]
develop other key GRIM inputs, including product and capital conversion
costs, and to gather additional information on the anticipated effects
of energy conservation standards on revenues, direct employment,
capital assets, industry competitiveness, and subgroup impacts.
In Phase 3 of the MIA, DOE conducted structured, detailed
interviews with a representative cross-section of manufacturers. During
these interviews, DOE discussed engineering, manufacturing,
procurement, and financial topics to validate assumptions used in the
GRIM and to identify key issues or concerns. See section IV.J.4 for a
description of the key issues raised by manufacturers during the
interviews. As part of Phase 3, DOE also evaluated subgroups of
manufacturers that may be disproportionately impacted by amended
standards or that may not be accurately represented by the average cost
assumptions used to develop the industry cash flow analysis. Such
manufacturer subgroups may include small manufacturers, low volume
manufacturers, niche players, and/or manufacturers exhibiting a cost
structure that largely differs from the industry average.
DOE identified one subgroup, small manufacturers, for which average
cost assumptions may not hold. DOE applied the small business size
standards published by the SBA to determine whether a company is
considered a small business. 65 FR 30840, May 15, 2000, as amended at
67 FR 52602, Aug. 13, 2002; 74 FR 46313, Sept. 9, 2009. To be
categorized as a small business under North American Industry
Classification System (NAICS) 333415, ``Air-Conditioning and Warm Air
Heating Equipment and Commercial and Industrial Refrigeration Equipment
Manufacturing,'' which includes commercial ice maker manufacturing, a
manufacturer and its affiliates may employ a maximum of 750 employees.
The 750-employee threshold includes all employees in a business's
parent company and any other subsidiaries. Based on this
classification, DOE identified seven manufacturers of automatic
commercial ice makers that qualify as small businesses. The automatic
commercial ice maker small manufacturer subgroup is discussed in
chapter 12 of the NOPR TSD and in section VI.B.1 of this rulemaking.
2. Government Regulatory Impact Model
DOE uses the GRIM to quantify the changes in industry cash flows
resulting from new or amended energy conservation standards. The GRIM
uses manufacturer costs, markups, shipments, and industry financial
information to arrive at a series of base-case annual cash flows absent
new or amended standards, beginning with the present year, 2013, and
continuing through 2047. The GRIM then models changes in costs,
investments, shipments, and manufacturer margins that may result from
new or amended energy conservation standards and compares these results
against those in the base-case forecast of annual cash flows. The
primary quantitative output of the GRIM is the INPV, which DOE
calculates by summing the stream of annual discounted cash flows over
the full analysis period. For manufacturers of automatic commercial ice
makers, DOE used a real discount rate of 9.2 percent, the weighted
average cost of capital as derived from industry financials. DOE then
modified this figure based on feedback received during confidential
interviews with manufacturers.
The GRIM calculates cash flows using standard accounting principles
and compares changes in INPV between the base case and the various
TSLs. The difference in INPV between the base case and a standards case
represents the financial impact of the amended standard on
manufacturers at that particular TSL. As discussed previously, DOE
collected the necessary information to develop key GRIM inputs from a
number of sources, including publicly available data and interviews
with manufacturers (described in the next section). The GRIM results
are shown in section V.B.2.a. Additional details about the GRIM can be
found in chapter 12 of the NOPR TSD.
a. Government Regulatory Impact Model Key Inputs
Manufacturer Production Costs
Manufacturing a higher efficiency product is typically more
expensive than manufacturing a baseline product due to the use of more
complex and typically more costly components. The changes in the MPCs
of the analyzed products can affect the revenues, gross margins, and
cash flow of the industry, making product cost data key GRIM inputs for
DOE's analysis.
For each efficiency level of each equipment class that was directly
analyzed, DOE used the MPCs developed in the engineering analysis, as
described in section IV.A.2 and further detailed in chapter 5 of the
NOPR TSD. For equipment classes that were indirectly analyzed, DOE used
a composite of MPCs from similar equipment classes, substitute
component costs, and design options to develop an MPC for each
efficiency level. For equipment classes that had multiple units
analyzed, DOE used a weighted average MPC based on the relative
shipments of products at each efficiency level as the input for the
GRIM. Additionally, DOE used information from its teardown analysis,
described in section IV.D, to disaggregate the MPCs into material and
labor costs. These cost breakdowns and equipment markups were validated
with manufacturers during manufacturer interviews.
Base-Case Shipments Forecast
The GRIM estimates manufacturer revenues based on total unit
shipment forecasts and the distribution of shipments by efficiency
level. Changes in sales volumes and efficiency mix over time can
significantly affect manufacturer finances. For this analysis, the GRIM
uses the NIA's annual shipment forecasts derived from the shipments
analysis from 2013, the base year, to 2047, the end of the analysis
period. See chapter 9 of the NOPR TSD for additional details.
Product and Capital Conversion Costs
Amended energy conservation standards will cause manufacturers to
incur conversion costs to bring their production facilities and product
designs into compliance. For the MIA, DOE classified these conversion
costs into two major groups: (1) product conversion costs and (2)
capital conversion costs. Product conversion costs include investments
in research, development, testing, marketing, and other non-capitalized
costs necessary to make product designs comply with new or amended
energy conservation standards. Capital conversion costs include
investments in property, plant, and equipment necessary to adapt or
change existing production facilities such that new product designs can
be fabricated and assembled.
Stranded Assets
If new or amended energy conservation standards require investment
in new manufacturing capital, there also exists the possibility that
they will render existing manufacturing capital obsolete. In the case
that this obsolete manufacturing capital is not fully depreciated at
the time new or amended standards go into effect, this would result in
the stranding of these assets, and would necessitate the write-down of
their residual un-depreciated value.
DOE used multiple sources of data to evaluate the level of product
and capital
[[Page 14903]]
conversion costs and stranded assets manufacturers would likely face to
comply with new or amended energy conservation standards. DOE used
manufacturer interviews to gather data on the level of investment
anticipated at each proposed efficiency level and validated these
assumptions using estimates of capital requirements derived from the
product teardown analysis and engineering model described in section
IV.D. These estimates were then aggregated and scaled using information
gained from industry product databases to derive total industry
estimates of product and capital conversion costs and to protect
confidential information.
In general, DOE assumes that all conversion-related investments
occur between the year the final rule is published and the year by
which manufacturers must comply with the new or amended standards. The
investment figures used in the GRIM can be found in section V.B.2.a of
this notice. For additional information on the estimated product
conversion and capital conversion costs, see chapter 12 of the NOPR
TSD.
b. Government Regulatory Impact Model Scenarios
Markup Scenarios
As discussed in section IV.D, MSPs include direct manufacturing
production costs (i.e., labor, material, overhead, and depreciation
estimated in DOE's MPCs) and all non-production costs (i.e., SG&A, R&D,
and interest), along with profit. To calculate the MSPs in the GRIM,
DOE applied manufacturer markups to the MPCs estimated in the
engineering analysis. Modifying these markups in the standards case
yields different sets of impacts on manufacturers. For the MIA, DOE
modeled two standards-case markup scenarios to represent the
uncertainty regarding the potential impacts on prices and profitability
for manufacturers following the implementation of amended energy
conservation standards: (1) A preservation of gross margin percentage
markup scenario; and (2) a preservation of earnings before interest and
taxes (EBIT) markup scenario. These scenarios lead to different markups
values that, when applied to the MPCs, result in varying revenue and
cash flow impacts.
Under the preservation of gross margin percentage scenario, DOE
applied a single, uniform ``gross margin percentage'' markup across all
efficiency levels. As production costs increase with efficiency, this
scenario implies that the absolute dollar markup will increase as well.
Based on publicly available financial information for manufacturers of
automatic commercial ice makers and comments from manufacturer
interviews, DOE assumed the industry average markup on production costs
to be 1.25. Because this markup scenario assumes that manufacturers
would be able to maintain their gross margin percentage as production
costs increase in response to an amended energy conservation standard,
it represents a lower bound of industry impacts (higher industry
profitability) under an amended energy conservation standard.
In the preservation of EBIT markup scenario, manufacturer markups
are calibrated so that EBIT in the year after the compliance date of
the amended energy conservation standard is the same as in the base
case. Under this scenario, as the cost of production goes up,
manufacturers are generally required to reduce the markups on their
minimally compliant products to maintain a cost competitive offering.
The implicit assumption behind this scenario is that the industry can
only maintain EBIT in absolute dollars after compliance with the
amended standard is required. Therefore, operating margin (as a
percentage) shrinks in the standards cases. This markup scenario
represents an upper bound of industry impacts (lower profitability)
under an amended energy conservation standard.
3. Discussion of Comments
In response to the February 2012 preliminary analysis public
meeting, interested parties commented on the assumptions and results of
the preliminary analysis TSD. Oral and written comments addressed
several topics, including the impact to suppliers and the distribution
channel, the importance of the ENERGYSTAR program, cumulative
regulatory burden, and the impact to small manufacturers.
a. Impact to Suppliers, Distributors, Dealers, and Contractors
AHRI commented that DOE must perform analyses to assess the impact
of the rule on component suppliers, distributors, dealers, and
contractors. Where the MIA serves to assess the impact of amended
energy conservation standards on manufacturers of automatic commercial
ice makers; any impact on distributors, dealers, and contractors falls
outside the scope of this analysis.
Impacts on component suppliers might arise if manufacturers
switched to more-efficient components, or if there was a substantial
reduction of orders following new or amended standards. In public
comments, manufacturers expressed that given their low production
volumes, the automatic commercial ice maker manufacturing industry has
little influence over component suppliers relative to other commercial
refrigeration equipment industries. It follows that energy conservation
standards for automatic commercial ice makers would have little impact
on component suppliers given their marginal contribution to overall
commercial refrigeration component demand.
b. ENERGY STAR
Manitowoc commented that it is a very strong supporter of ENERGY
STAR and that certification is very important to its customers because
of the potential for utility rebates, Leadership in Energy and
Environmental Design (LEED) certification, and other reasons. Manitowoc
expressed concern that, if efficiency standards were raised to the max-
tech level, there would be no more room for an ENERGY STAR category,
which would be disruptive to the industry.
DOE acknowledges the importance of the ENERGY STAR program and of
understanding its interaction with energy efficiency standards.
However, EPCA requires DOE to establish energy conservation standards
at the maximum level that is technically feasible and economically
justified. DOE has found, over time, with other products, as the
standard level is increased, manufacturers' research results in energy
efficiency improvements that are regarded by the ENERGY STAR program.
As such, any standard level below the max-tech level continues to leave
room for ENERGY STAR rebate programs.
c. Cumulative Regulatory Burden
AHRI commented on the cumulative regulatory burden associated with
DOE efficiency standards. AHRI indicated that several legislative and
regulatory activities should be considered, including legislation
intended to reduce lead in drinking water and climate change bills that
may be considered by Congress. (AHRI, No. 49 at p. 4)
DOE takes into account the cumulative cost of multiple Federal
regulations on manufacturers in the cumulative regulatory burden
section of its analysis, which can be found in section V.B.2.e of this
notice. DOE does not analyze the quantitative impacts of standards that
have not yet been finalized. Similarly, DOE does not analyze the
impacts of potential climate change bills because any impacts would
[[Page 14904]]
be speculative in the absence of final legislation.
AHRI noted that California has regulations to limit GHGs and the
measures established by the California Air Resources Board (CARB) to
reduce global warming will reduce the use of refrigerants such as HFCs.
CARB is currently limiting the in-State use of refrigerants considered
to have high global warming potential (GWP) in non-residential
refrigeration systems through its Refrigerant Management Program that
became effective on January 1, 2011.\56\ According to this new
regulation, facilities with refrigeration systems that have a
refrigerant capacity exceeding 50 lb must repair leaks within 14 days
of detection, maintain on-site records of all leak repairs, and keep
receipts of all refrigerant purchases. The regulation applies to any
person or company that installs, services, or disposes of appliances
with high-GWP refrigerants. Refrigeration systems with a refrigerant
capacity exceeding 50 lb typically belong to food retail operations
with remote condensing racks that store refrigerant serving multiple
commercial refrigeration and ice-making units within a business.
However, automatic commercial ice makers in food retail establishments
are usually installed and serviced by refrigeration contractors, not
manufacturers. As a result, although these CARB regulations apply to
refrigeration technicians and owners of facilities with refrigeration
systems, they are unlikely to represent a regulatory burden for
manufacturers of automatic commercial ice makers.
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\56\ See www.arb.ca.gov/cc/reftrack/reftrackrule.html.
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The discussion of cumulative regulatory burden on manufacturers of
automatic commercial ice makers is detailed further in chapter 12 of
the NOPR TSD.
d. Small Manufacturers
Howe observed that most high-capacity ice makers are made by small
manufacturers, and consequently, setting higher efficiency standards
for high-capacity equipment may be discriminatory against small
manufacturers. (Howe, No. 51 at p. 2)
DOE agrees that amended standards may have disproportionate impacts
on smaller manufacturers. To make this determination, the DOE conducts
an analysis of impacts on certain manufacturer subgroups including
small businesses to assess if any impacts prove to be disproportionate.
The results of this analysis are described further in section VI.B of
this notice and detailed in chapter 12 of the NOPR TSD.
4. Manufacturer Interviews
To inform the MIA, DOE interviewed manufacturers with an estimated
combined market share of 95 percent. The information gathered during
these interviews enabled DOE to tailor the GRIM to reflect the unique
financial characteristics of the automatic commercial ice maker
industry. These confidential interviews provided information that DOE
used to evaluate the impacts of amended energy conservation standards
on manufacturer cash flows, manufacturing capacities, and employment
levels.
During the manufacturer interviews, DOE asked manufacturers to
describe their major concerns about this rulemaking. The following
sections describe the most significant issues identified by
manufacturers. DOE also includes additional concerns in chapter 12 of
the NOPR TSD.
a. Price Sensitivity
All manufacturers interviewed characterized the market for
automatic commercial ice makers as extremely price sensitive. They hold
the position that new and amended standards will result in decreased
profit margins as they will be unable to pass through costs relating to
standards compliance. They noted that this will be particularly
troublesome for lower capacity equipment classes (Small SCU and Small
IMH), which are sold primarily to smaller restaurants and food service
establishments with limited access to capital. Additionally, they noted
that distributors tend to be individual proprietors or small franchises
with limited opportunities to extend financing to their customers.
Manufacturers went on to report that while energy efficiency is
important, it is not a feature for which customers would pay a premium.
One manufacturer also noted that replacement parts represented 70
percent of sales, and while sales of parts had increased since 2009,
unit sales had decreased, indicating that customers were holding onto
units longer. The ability to extend the life of a unit through repairs
and refurbishment presents a further economic challenge to
manufacturers facing energy efficiency standards.
b. Enforcement
Manufacturers characterized the automatic commercial ice maker
market as a niche market with a high degree of competition. The recent
entrance of foreign manufacturers has led to a further tightening of
price competition due to the lower labor costs of these foreign
manufacturers. Several domestic manufacturers expressed concern about
the enforcement of an amended energy efficiency standard for automatic
commercial ice makers produced overseas. Manufacturers believe that
insufficient enforcement will lead to market distortions, as companies
that make the necessary investments to meet amended standards would be
at a distinct pricing disadvantage to unscrupulous competitors, often
times foreign manufacturers, that do not fully comply. The
manufacturers requested that DOE take the enforcement action necessary
to maintain a level playing field and to eliminate non-compliant
products from the market.
c. Reliability Impacts
Some manufacturers expressed concerns that future energy
conservation standards would have an adverse impact on the reliability
of their products. One manufacturer stated that any time new components
or designs are introduced, that there is an increase in service calls
and the mean time between failures drops as they work out the issues.
This manufacturer went on to emphasize that reliability is the most
important feature of their products.
d. Impact on Innovation
Several manufacturers expressed concerns over the imbalance of
internal engineering resources brought about by the regular revision
and introduction of energy conservation standards. As energy use has
become increasingly regulated, manufacturers have had to shift
engineering and support resources away from other initiatives,
adversely affecting product innovation outside of energy efficiency.
One manufacturer reported that a previous round of standards required
nearly all of the company's engineering resources for between 1 and 2
years. Where the R&D effort required for compliance is intermittent,
innovation is impacted without adding to overall employment. DOE
requests additional comment on the intermittency of R&D efforts
directed at compliance with energy conservation standards and its
impact on other research and development resources.
K. Emissions Analysis
In the emissions analysis, DOE estimates the reduction in power
sector emissions of CO2, NOX, SO2, and
Hg from potential energy conservation standards for automatic
commercial ice makers. In addition, DOE estimates emissions impacts in
production activities (extracting, processing, and transporting fuels)
that provide the energy inputs to power plants. These are
[[Page 14905]]
referred to as ``upstream'' emissions. Together, these emissions
account for the full-fuel-cycle (FFC). In accordance with DOE's FFC
Statement of Policy (76 FR 51282 (Aug. 18, 2011)), as amended at 77 FR
49701 (Aug. 17, 2012), the FFC analysis includes impacts on emissions
of methane (CH4) and nitrous oxide (N2O), both of
which are recognized as GHGs.
DOE conducted the emissions analysis using emissions factors that
were derived from data in AEO2013, supplemented by data from other
sources. DOE developed separate emissions factors for power sector
emissions and upstream emissions. The method that DOE used to derive
emissions factors is described in chapter 13 of the NOPR TSD.
The emissions intensity factors are expressed in terms of physical
units per MWh or MMBtu of site energy savings. For CH4 and
N2O, DOE also presents results in terms of units of carbon
dioxide equivalent (CO2eq). Gases are converted to
CO2eq by multiplying the physical units by the gas' global
warming potential (GWP) over a 100 year time horizon. Based on the
Fourth Assessment Report of the Intergovernmental Panel on Climate
Change, DOE used GWP values of 25 for CH4 and 298 for
N2O.
EIA prepares the AEO using NEMS. Each annual version of NEMS
incorporates the projected impacts of existing air quality regulations
on emissions. AEO2013 generally represents current legislation and
environmental regulations, including recent government actions, for
which implementing regulations were available as of December 31, 2012.
SO2 emissions from affected electric generating units
(EGUs) are subject to nationwide and regional emissions cap-and-trade
programs. Title IV of the Clean Air Act sets an annual emissions cap on
SO2 for affected EGUs in the 48 contiguous States and the
District of Columbia (DC). SO2 emissions from 28 eastern
States and DC were also limited under the Clean Air Interstate Rule
(CAIR; 70 FR 25162 (May 12, 2005)), which created an allowance-based
trading program that operates along with the Title IV program. CAIR was
remanded to U.S. Environmental Protection Agency (EPA) by the U.S.
Court of Appeals for the District of Columbia Circuit but it remained
in effect. See North Carolina v. EPA, 550 F.3d 1176 (D.C. Cir. 2008);
North Carolina v. EPA, 531 F.3d 896 (D.C. Cir. 2008). On July 6, 2011
EPA issued a replacement for CAIR, the Cross-State Air Pollution Rule
(CSAPR). 76 FR 48208 (August 8, 2011). On August 21, 2012, the DC
Circuit issued a decision to vacate CSAPR. See EME Homer City
Generation, LP v. EPA, 696 F.3d 7, 38 (D.C. Cir. 2012). The court
ordered EPA to continue administering CAIR. The AEO2013 emissions
factors used for today's NOPR assume that CAIR remains a binding
regulation through 2040.
The attainment of emissions caps is typically flexible among EGUs
and is enforced through the use of emissions allowances and tradable
permits. Under existing EPA regulations, any excess SO2
emissions allowances resulting from the lower electricity demand caused
by the adoption of an efficiency standard could be used to permit
offsetting increases in SO2 emissions by any regulated EGU.
In past rulemakings, DOE recognized that there was uncertainty about
the effects of efficiency standards on SO2 emissions covered
by the existing cap-and-trade system, but it concluded that negligible
reductions in power sector SO2 emissions would occur as a
result of standards.
Beginning in 2015, however, SO2 emissions will fall as a
result of the Mercury and Air Toxics Standards (MATS) for power plants.
77 FR 9304 (Feb. 16, 2012). In the final MATS rule, EPA established a
standard for hydrogen chloride as a surrogate for acid gas hazardous
air pollutants (HAP), and also established a standard for
SO2 (a non-HAP acid gas) as an alternative equivalent
surrogate standard for acid gas HAP. The same controls are used to
reduce HAP and non-HAP acid gas; thus, SO2 emissions will be
reduced as a result of the control technologies installed on coal-fired
power plants to comply with the MATS requirements for acid gas. AEO2013
assumes that, in order to continue operating, coal plants must have
either flue gas desulfurization or dry sorbent injection systems
installed by 2015. Both technologies, which are used to reduce acid gas
emissions, also reduce SO2 emissions. Under the MATS, NEMS
shows a reduction in SO2 emissions when electricity demand
decreases (e.g., as a result of energy efficiency standards). Emissions
will be far below the cap established by CAIR, so it is unlikely that
excess SO2 emissions allowances resulting from the lower
electricity demand would be needed or used to permit offsetting
increases in SO2 emissions by any regulated EGU. Therefore,
DOE believes that efficiency standards will reduce SO2
emissions in 2015 and beyond.
CAIR established a cap on NOX emissions in 28 eastern
States and the District of Columbia. Energy conservation standards are
expected to have little effect on NOX emissions in those
States covered by CAIR because excess NOX emissions
allowances resulting from the lower electricity demand could be used to
permit offsetting increases in NOX emissions. However,
standards would be expected to reduce NOX emissions in the
States not affected by the caps, so DOE estimated NOX
emissions reductions from the standards considered in today's NOPR for
these States.
The MATS limit mercury emissions from power plants, but they do not
include emissions caps and, as such, DOE's energy conservation
standards would likely reduce Hg emissions. DOE estimated mercury
emissions reduction using emissions factors based on AEO2013, which
incorporates the MATS.
L. Monetizing Carbon Dioxide and Other Emissions Impacts
As part of the development of this proposed rule, DOE considered
the estimated monetary benefits from the reduced emissions of
CO2 and NOX that are expected to result from each
of the TSLs considered. In order to make this calculation similar to
the calculation of the NPV of consumer benefit, DOE considered the
reduced emissions expected to result over the lifetime of equipment
shipped in the forecast period for each TSL. This section summarizes
the basis for the monetary values used for each of these emissions and
presents the values considered in this rulemaking.
For today's NOPR, DOE is relying on a set of values for the social
cost of carbon (SCC) that was developed by an interagency process. A
summary of the basis for these values is provided below, and a more
detailed description of the methodologies used is provided as an
appendix to chapter 14 of the TSD.
1. Social Cost of Carbon
The SCC is an estimate of the monetized damages associated with an
incremental increase in carbon emissions in a given year. It is
intended to include (but is not limited to) changes in net agricultural
productivity, human health, property damages from increased flood risk,
and the value of ecosystem services. Estimates of the SCC are provided
in dollars per metric ton of carbon dioxide. A domestic SCC value is
meant to reflect the value of damages in the United States resulting
from a unit change in carbon dioxide emissions, while a global SCC
value is meant to reflect the value of damages worldwide.
[[Page 14906]]
Under section 1(b) of Executive Order 12866, agencies must, to the
extent permitted by law, ``assess both the costs and the benefits of
the intended regulation and, recognizing that some costs and benefits
are difficult to quantify, propose or adopt a regulation only upon a
reasoned determination that the benefits of the intended regulation
justify its costs.'' The purpose of the SCC estimates presented here is
to allow agencies to incorporate the monetized social benefits of
reducing CO2 emissions into cost-benefit analyses of
regulatory actions that have small, or ``marginal,'' impacts on
cumulative global emissions. The estimates are presented with an
acknowledgement of the many uncertainties involved and with a clear
understanding that they should be updated over time to reflect
increasing knowledge of the science and economics of climate impacts.
As part of the interagency process that developed these SCC
estimates, technical experts from numerous agencies met on a regular
basis to consider public comments, explore the technical literature in
relevant fields, and discuss key model inputs and assumptions. The main
objective of this process was to develop a range of SCC values using a
defensible set of input assumptions grounded in the existing scientific
and economic literatures. In this way, key uncertainties and model
differences transparently and consistently inform the range of SCC
estimates used in the rulemaking process.
a. Monetizing Carbon Dioxide Emissions
When attempting to assess the incremental economic impacts of
carbon dioxide (CO2) emissions, the analyst faces a number
of serious challenges. A report from the National Research Council \57\
points out that any assessment will suffer from uncertainty,
speculation, and lack of information about (1) future emissions of
greenhouse gases, (2) the effects of past and future emissions on the
climate system, (3) the impact of changes in climate on the physical
and biological environment, and (4) the translation of these
environmental impacts into economic damages. As a result, any effort to
quantify and monetize the harms associated with climate change will
raise serious questions of science, economics, and ethics and should be
viewed as provisional.
---------------------------------------------------------------------------
\57\ National Research Council. Hidden Costs of Energy: Unpriced
Consequences of Energy Production and Use. National Academies Press:
Washington, DC (2009).
---------------------------------------------------------------------------
Despite the serious limits of both quantification and monetization,
SCC estimates can be useful in estimating the social benefits of
reducing carbon dioxide emissions. Most Federal regulatory actions can
be expected to have marginal impacts on global emissions. For such
policies, the agency can estimate the benefits from reduced (or costs
from increased) emissions in any future year by multiplying the change
in emissions in that year by the SCC value appropriate for that year.
The net present value of the benefits can then be calculated by
multiplying each of these future benefits by an appropriate discount
factor and summing across all affected years. This approach assumes
that the marginal damages from increased emissions are constant for
small departures from the baseline emissions path, an approximation
that is reasonable for policies that have effects on emissions that are
small relative to cumulative global carbon dioxide emissions. For
policies that have a large (non-marginal) impact on global cumulative
emissions, there is a separate question of whether the SCC is an
appropriate tool for calculating the benefits of reduced emissions.
This concern is not applicable to this notice, however.
It is important to emphasize that the interagency process is
committed to updating these estimates as the science and economic
understanding of climate change and its impacts on society improves
over time. In the meantime, the interagency group will continue to
explore the issues raised by this analysis and consider public comments
as part of the ongoing interagency process.
b. Social Cost of Carbon Values Used in Past Regulatory Analyses
Economic analyses for Federal regulations have used a wide range of
values to estimate the benefits associated with reducing carbon dioxide
emissions. The model year 2011 Corporate Average Fuel Economy final
rule, the U.S. Department of Transportation (DOT) used both a
``domestic'' SCC value of $2 per metric ton of CO2 and a
``global'' SCC value of $33 per metric ton of CO2 for 2007
emission reductions (in 2007$), increasing both values at 2.4 percent
per year. DOT also included a sensitivity analysis at $80 per metric
ton of CO2.\58\ A 2008 regulation proposed by DOT assumed a
domestic SCC value of $7 per metric ton of CO2 (in 2006$)
for 2011 emission reductions (with a range of $0-$14 for sensitivity
analysis), also increasing at 2.4 percent per year.\59\ A regulation
for packaged terminal air conditioners and packaged terminal heat pumps
finalized by DOE in 2008 used a domestic SCC range of $0 to $20 per
metric ton CO2 for 2007 emission reductions (in 2007$). 73
FR 58772, 58814 (Oct. 7, 2008) In addition, EPA's 2008 Advance Notice
of Proposed Rulemaking on Regulating Greenhouse Gas Emissions Under the
Clean Air Act identified what it described as ``very preliminary'' SCC
estimates subject to revision. 73 FR 44354 (July 30, 2008). EPA's
global mean values were $68 and $40 per metric ton CO2 for
discount rates of approximately 2 percent and 3 percent, respectively
(in 2006$ for 2007 emissions).
---------------------------------------------------------------------------
\58\ See Average Fuel Economy Standards Passenger Cars and Light
Trucks Model Year 2011, 74 FR 14196 (March 30, 2009) (Final Rule);
Final Environmental Impact Statement Corporate Average Fuel Economy
Standards, Passenger Cars and Light Trucks, Model Years 2011-2015 at
3-90 (Oct. 2008) (Available at: https://www.nhtsa.gov/fuel-economy).
\59\ See Average Fuel Economy Standards, Passenger Cars and
Light Trucks, Model Years 2011-2015, 73 FR 24352 (May 2, 2008)
(Proposed Rule); Draft Environmental Impact Statement Corporate
Average Fuel Economy Standards, Passenger Cars and Light Trucks,
Model Years 2011-2015 at 3-58 (June 2008) (Available at: https://www.nhtsa.gov/fuel-economy)
---------------------------------------------------------------------------
In 2009, an interagency process was initiated to offer a
preliminary assessment of how best to quantify the benefits from
reducing carbon dioxide emissions. To ensure consistency in how
benefits are evaluated across agencies, the Administration sought to
develop a transparent and defensible method, specifically designed for
the rulemaking process, to quantify avoided climate change damages from
reduced CO2 emissions. The interagency group did not
undertake any original analysis. Instead, it combined SCC estimates
from the existing literature to use as interim values until a more
comprehensive analysis could be conducted. The outcome of the
preliminary assessment by the interagency group was a set of five
interim values: global SCC estimates for 2007 (in 2006$) of $55, $33,
$19, $10, and $5 per metric ton of CO2. These interim values
represented the first sustained interagency effort within the U.S.
government to develop an SCC for use in regulatory analysis. The
results of this preliminary effort were presented in several proposed
and final rules.
c. Current Approach and Key Assumptions
Since the release of the interim values, the interagency group
reconvened on a regular basis to generate improved SCC estimates.
Specifically, the group considered public comments and further explored
[[Page 14907]]
the technical literature in relevant fields. The interagency group
relied on three integrated assessment models commonly used to estimate
the SCC: the FUND, DICE, and PAGE models. These models are frequently
cited in the peer-reviewed literature, and were used in the last
assessment of the Intergovernmental Panel on Climate Change. Each model
was given equal weight in the SCC values that were developed.
Each model takes a slightly different approach to model how changes
in emissions result in changes in economic damages. A key objective of
the interagency process was to enable a consistent exploration of the
three models while respecting the different approaches to quantifying
damages taken by the key modelers in the field. An extensive review of
the literature was conducted to select three sets of input parameters
for these models: climate sensitivity, socio-economic and emissions
trajectories, and discount rates. A probability distribution for
climate sensitivity was specified as an input into all three models. In
addition, the interagency group used a range of scenarios for the
socio-economic parameters and a range of values for the discount rate.
All other model features were left unchanged, relying on the model
developers' best estimates and judgments.
The interagency group selected four sets of SCC values for use in
regulatory analyses. Three sets of values are based on the average SCC
from the three integrated assessment models, at discount rates of 2.5,
3, and 5 percent. The fourth set, which represents the 95th percentile
SCC estimate across all three models at a 3-percent discount rate, is
included to represent higher-than-expected impacts from temperature
change further out in the tails of the SCC distribution. The values
grow in real terms over time. Additionally, the interagency group
determined that a range of values from 7 percent to 23 percent should
be used to adjust the global SCC to calculate domestic effects,
although preference is given to consideration of the global benefits of
reducing CO2 emissions. Table IV.31 presents the values in
the 2010 interagency group report,\60\ which is reproduced in appendix
14-A of the NOPR TSD.
---------------------------------------------------------------------------
\60\ Social Cost of Carbon for Regulatory Impact Analysis Under
Executive Order 12866. Interagency Working Group on Social Cost of
Carbon, United States Government, February 2010.
<www.whitehouse.gov/sites/default/files/omb/inforeg/for-agencies/Social-Cost-of-Carbon-for-RIA.pdf.>
Table IV.31--Annual SCC Values From 2010 Interagency Report, 2010-2050
[2007 dollars per metric ton]
----------------------------------------------------------------------------------------------------------------
Discount rate (%)
---------------------------------------------------------------
5 3 2.5 3
---------------------------------------------------------------
95th
Average Average Average percentile
----------------------------------------------------------------------------------------------------------------
2010............................................ 4.7 21.4 35.1 64.9
2015............................................ 5.7 23.8 38.4 72.8
2020............................................ 6.8 26.3 41.7 80.7
2025............................................ 8.2 29.6 45.9 90.4
2030............................................ 9.7 32.8 50.0 100.0
2035............................................ 11.2 36.0 54.2 109.7
2040............................................ 12.7 39.2 58.4 119.3
2045............................................ 14.2 42.1 61.7 127.8
2050............................................ 15.7 44.9 65.0 136.2
----------------------------------------------------------------------------------------------------------------
The SCC values used for today's notice were generated using the
most recent versions of the three integrated assessment models that
have been published in the peer-reviewed literature.\61\ Table IV.32
shows the updated sets of SCC estimates in five year increments from
2010 to 2050. The full set of annual SCC estimates between 2010 and
2050 is reported in appendix 14-B of the NOPR TSD. The central value
that emerges is the average SCC across models at the 3-percent discount
rate. However, for purposes of capturing the uncertainties involved in
regulatory impact analysis, the interagency group emphasizes the
importance of including all four sets of SCC values.
---------------------------------------------------------------------------
\61\ Technical Update of the Social Cost of Carbon for
Regulatory Impact Analysis Under Executive Order 12866. Interagency
Working Group on Social Cost of Carbon, United States Government.
May 2013; revised November 2013. <https://www.whitehouse.gov/sites/default/files/omb/assets/inforeg/technical-update-social-cost-of-carbon-for-regulator-impact-analysis.pdf>
Table IV.32--Annual SCC Values From 2013 Interagency Update, 2010-2050
[2007 dollars per metric ton CO[ihel2]]
----------------------------------------------------------------------------------------------------------------
Discount rate (%)
---------------------------------------------------------------
5 3 2.5 3
Year ---------------------------------------------------------------
95th
Average Average Average percentile
----------------------------------------------------------------------------------------------------------------
2010............................................ 11 32 51 89
2015............................................ 11 37 57 109
2020............................................ 12 43 64 128
2025............................................ 14 47 69 143
2030............................................ 16 52 75 159
2035............................................ 19 56 80 175
2040............................................ 21 61 86 191
[[Page 14908]]
2045............................................ 24 66 92 206
2050............................................ 26 71 97 220
----------------------------------------------------------------------------------------------------------------
It is important to recognize that a number of key uncertainties
remain, and that current SCC estimates should be treated as provisional
and revisable since they will evolve with improved scientific and
economic understanding. The interagency group also recognizes that the
existing models are imperfect and incomplete. The National Research
Council report mentioned above points out that there is tension between
the goal of producing quantified estimates of the economic damages from
an incremental ton of carbon and the limits of existing efforts to
model these effects. There are a number of concerns and problems that
should be addressed by the research community, including research
programs housed in many of the Federal agencies participating in the
interagency process to estimate the SCC. The interagency group intends
to periodically review and reconsider those estimates to reflect
increasing knowledge of the science and economics of climate impacts,
as well as improvements in modeling.
In summary, in considering the potential global benefits resulting
from reduced CO2 emissions, DOE used the values from the
2013 interagency report adjusted to 2012$ using the Gross Domestic
Product (GDP) price deflator. For each of the four case of SCC values,
the values for emissions in 2015 were $11.8, $39.7, $61.2, and $117.0
per metric ton avoided (values expressed in 2012$). DOE derived values
after 2050 using the relevant growth rates for the 2040-2050 period in
the interagency update.
DOE multiplied the CO2 emissions reduction estimated for
each year by the SCC value for that year in each of the four cases. To
calculate a present value of the stream of monetary values, DOE
discounted the values in each of the four cases using the specific
discount rate that had been used to obtain the SCC values in each case.
2. Valuation of Other Emissions Reductions
As noted above, DOE has taken into account how new or amended
energy conservation standards would reduce NOX emissions in
those 22 States not affected by emission caps. DOE estimated the
monetized value of NOX emissions reductions resulting from
each of the TSLs considered for today's NOPR based on estimates found
in the relevant scientific literature. Estimates of monetary value for
reducing NOX from stationary sources range from $468 to
$4,809 per ton (2012$).\62\ DOE calculated monetary benefits using a
medium value for NOX emissions of $2,639 per short ton (in
2012$), and real discount rates of 3 percent and 7 percent.
---------------------------------------------------------------------------
\62\ For additional information, refer to U.S. Office of
Management and Budget, Office of Information and Regulatory Affairs,
2006 Report to Congress on the Costs and Benefits of Federal
Regulations and Unfunded Mandates on State, Local, and Tribal
Entities, Washington, DC.
---------------------------------------------------------------------------
DOE is evaluating appropriate monetization of avoided
SO2 and Hg emissions in energy conservation standards
rulemakings. It has not included monetization in the current analysis.
M. Utility Impact Analysis
In the utility impact analysis, DOE analyzes the changes in
electric installed capacity and generation that result for each TSL.
The utility impact analysis uses a variant of NEMS,\63\ which is a
public domain, multi-sectored, partial equilibrium model of the U.S.
energy sector. DOE uses a variant of this model, referred to as NEMS-
BT,\64\ to account for selected utility impacts of new or amended
energy conservation standards. DOE's analysis consists of a comparison
between model results for the most recent AEO Reference Case and for
cases in which energy use is decremented to reflect the impact of
potential standards. The energy savings inputs associated with each TSL
come from the NIA. Chapter 15 of the NOPR TSD describes the utility
impact analysis.
---------------------------------------------------------------------------
\63\ For more information on NEMS, refer to the U.S. Department
of Energy, Energy Information Administration documentation. A useful
summary is National Energy Modeling System: An Overview 2003, DOE/
EIA-0581 (2003), March, 2003.
\64\ DOE/EIA approves use of the name ``NEMS'' to describe only
an official version of the model without any modification to code or
data. Because this analysis entails some minor code modifications
and the model is run under various policy scenarios that are
variations on DOE/EIA assumptions, DOE refers to it by the name
``NEMS-BT'' (``BT'' is DOE's Building Technologies Program, under
whose aegis this work has been performed).
---------------------------------------------------------------------------
N. Employment Impact Analysis
Employment impacts include direct and indirect impacts. Direct
employment impacts are any changes in the number of employees of
manufacturers of the products subject to standards; the MIA addresses
those impacts. Indirect employment impacts are changes in national
employment that occur due to the shift in expenditures and capital
investment caused by the purchase and operation of more-efficient
appliances. Indirect employment impacts from standards consist of the
jobs created or eliminated in the national economy due to: (1) reduced
spending by end users on energy; (2) reduced spending on new energy
supply by the utility industry; (3) increased customer spending on the
purchase of new products; and (4) the effects of those three factors
throughout the economy.
One method for assessing the possible effects on the demand for
labor of such shifts in economic activity is to compare sector
employment statistics developed by the Labor Department's Bureau of
Labor Statistics (BLS). BLS regularly publishes its estimates of the
number of jobs per million dollars of economic activity in different
sectors of the economy, as well as the jobs created elsewhere in the
economy by this same economic activity. Data from BLS indicate that
expenditures in the utility sector generally create fewer jobs (both
directly and indirectly) than expenditures in other sectors of the
economy.\65\ There are many reasons for these differences, including
wage differences and the fact that the utility sector is more capital-
intensive and less
[[Page 14909]]
labor-intensive than other sectors. Energy conservation standards have
the effect of reducing customer utility bills. Because reduced customer
expenditures for energy likely lead to increased expenditures in other
sectors of the economy, the general effect of efficiency standards is
to shift economic activity from a less labor-intensive sector (i.e.,
the utility sector) to more labor-intensive sectors (e.g., the retail
and service sectors). Thus, based on the BLS data alone, DOE believes
net national employment may increase because of shifts in economic
activity resulting from amended energy conservation standards for
automatic commercial ice makers.
---------------------------------------------------------------------------
\65\ See Bureau of Economic Analysis, ``Regional Multipliers: A
User Handbook for the Regional Input-Output Modeling System (RIMS
II),'' U.S. Department of Commerce (1992).
---------------------------------------------------------------------------
For the amended standard levels considered in today's NOPR, DOE
estimated indirect national employment impacts using an input/output
model of the U.S. economy called Impact of Sector Energy Technologies
version 3.1.1 (ImSET).\66\ ImSET is a special-purpose version of the
``U.S. Benchmark National Input-Output'' (I-O) model, which was
designed to estimate the national employment and income effects of
energy-saving technologies. The ImSET software includes a computer-
based I-O model having structural coefficients that characterize
economic flows among the 187 sectors. ImSET's national economic I-O
structure is based on a 2002 U.S. benchmark table, specially aggregated
to the 187 sectors most relevant to industrial, commercial, and
residential building energy use. DOE notes that ImSET is not a general
equilibrium forecasting model, and understands the uncertainties
involved in projecting employment impacts, especially changes in the
later years of the analysis. Because ImSET does not incorporate price
changes, the employment effects predicted by ImSET may over-estimate
actual job impacts over the long run. For the NOPR, DOE used ImSET only
to estimate short-term (through 2022) employment impacts.
---------------------------------------------------------------------------
\66\ Scott, M.J., O.V. Livingston, P.J. Balducci, J.M. Roop, and
R.W. Schultz. ImSET 3.1: Impact of Sector Energy Technologies. 2009.
Pacific Northwest National Laboratory, Richland, WA. Report No.
PNNL-18412. <www.pnl.gov/main/publications/external/technical_reports/PNNL-18412.pdf>
---------------------------------------------------------------------------
For more details on the employment impact analysis, see chapter 16
of the NOPR TSD.
At the February 2012 preliminary analysis public meeting, NPCC
inquired whether the money saved from low water consumption will be
moved into the employment impact analysis along with the money saved
from lower energy consumption. (NPCC, No. 42 at pp. 164 and 165) In
response, DOE notes that all changes in operations and maintenance
costs, including water costs, are captured in the employment analysis.
For more details on the employment impact analysis and its results,
see chapter 16 of the NOPR TSD and section V.B.3.d of this notice.
O. Regulatory Impact Analysis
DOE prepared a regulatory impact analysis (RIA) for this
rulemaking, which is described in chapter 17 of the NOPR TSD. The RIA
is subject to review by OIRA in the OMB. The RIA consists of (1) a
statement of the problem addressed by this regulation and the mandate
for Government action; (2) a description and analysis of policy
alternatives to this regulation; (3) a qualitative review of the
potential impacts of the alternatives; and (4) the national economic
impacts of the proposed standard.
The RIA assesses the effects of feasible policy alternatives to
amended automatic commercial ice makers standards and provides a
comparison of the impacts of the alternatives. DOE evaluated the
alternatives in terms of their ability to achieve significant energy
savings at reasonable cost, and compared them to the effectiveness of
the proposed rule.
DOE identified the following major policy alternatives for
achieving increased automatic commercial ice makers efficiency:
No new regulatory action
commercial customer tax credits
commercial customer rebates
voluntary energy efficiency targets
bulk government purchases
early replacement
DOE qualitatively evaluated each alternative's ability to achieve
significant energy savings at reasonable cost and compared it to the
effectiveness of the proposed rule. DOE assumed that each alternative
policy would induce commercial customers to voluntarily purchase at
least some higher efficiency equipment at any of the TSLs. In contrast
to a standard at one of the TSLs, the adoption rate of the alternative
non-regulatory policy cases may not be 100 percent, which would result
in lower energy savings than a standard. The following paragraphs
discuss each policy alternative. (See chapter 17 of the NOPR TSD for
further details.)
No new regulatory action: The case in which no regulatory action is
taken for automatic commercial ice makers constitutes the base-case (or
no action) scenario. By definition, no new regulatory action yields
zero energy savings and an NPV of zero dollars.
Commercial customer tax credits: Customer tax credits are
considered a viable non-regulatory market transformation program. From
a customer perspective, the most important difference between rebate
and tax credit programs is that a rebate can be obtained quickly,
whereas receipt of tax credits is delayed until income taxes are filed
or a tax refund is provided by the Internal Revenue Service (IRS). From
a societal perspective, tax credits (like rebates) do not change the
installed cost of the equipment, but rather transfer a portion of the
cost from the customer to taxpayers as a whole. DOE, therefore, assumed
that equipment costs in the customer tax credits scenario were
identical to the NIA base case. The change in the NES and NPV is a
result of the change in the efficiency distributions that results from
lowering the prices of higher efficiency equipment.
Commercial customer rebates: Customer rebates cover a portion of
the difference in incremental product price between products meeting
baseline efficacy levels and those meeting higher efficiency levels,
resulting in a higher percentage of customers purchasing more-
efficacious models and decreased aggregated energy use compared to the
base case. Although the rebate program reduces the total installed cost
to the customer, it is financed by tax revenues. Therefore, from a
societal perspective, the installed cost at any efficiency level does
not change with the rebate program; rather, part of the cost is
transferred from the customer to taxpayers as a whole. Consequently,
DOE assumed that equipment costs in the rebates scenario were identical
to the NIA base case. The change in the NES and NPV is a result of the
change in the efficiency distributions that results as a consequence of
lowering the prices of higher efficiency equipment.
Voluntary energy efficiency targets: While it is possible that
voluntary programs for equipment would be effective, DOE lacks a
quantitative basis to determine how effective such a program might be.
As noted previously, broader economic and social considerations are in
play than simple economic return to the equipment purchaser. DOE lacks
the data necessary to quantitatively project the degree to which
voluntary programs for more expensive, higher efficiency equipment
would modify the market.
Bulk government purchases and early replacement incentive programs:
DOE also considered, but did not analyze, the potential of bulk
government purchases
[[Page 14910]]
and early replacement incentive programs as alternatives to the
proposed standards. Bulk government purchases would have a very limited
impact on improving the overall market efficiency of automatic
commercial ice makers because they would be a small part of the total
equipment sold in the market. In the case of replacement incentives,
several policy options exist to promote early replacement, including a
direct national program of customer incentives, incentives paid to
utilities to promote an early replacement program, market promotions
through equipment manufacturers, and replacement of government-owned
equipment. In considering early replacements, DOE estimates that the
energy savings realized through a one-time early replacement of
existing stock equipment does not result in energy savings commensurate
to the cost to administer the program. Consequently, DOE did not
analyze this option in detail.
V. Analytical Results
A. Trial Standard Levels
1. Trial Standard Level Formulation Process and Criteria
DOE selected between four and seven efficiency levels for all
equipment classes for analysis. For all equipment classes, the first
efficiency level is the baseline efficiency level. Based on the results
of the LCC analysis and NIA, DOE selected five TSLs above the baseline
level for each equipment class for the NOPR stage of this rulemaking.
Table V.1 shows the mapping between TSLs and efficiency levels.
TSL 5 was selected at the max-tech level for all equipment classes.
TSL 4 was chosen as an intermediate level between the max-tech
level and the maximum customer NPV level, subject to the requirement
that the TSL 4 NPV must be positive. ``Customer NPV'' is the NPV of
future savings obtained from the NIA. It provides a measure of the
benefits only to the customers of the automatic commercial ice makers,
and does not account for the net benefits to the Nation. The net
benefits to the Nation also include monetized values of emissions
reductions in addition to the customer NPV. Where a sufficient number
of efficiency levels allow it, TSL 4 is set at least one level below
max-tech and one level above the efficiency level with the highest NPV.
In one case, the TSL 4 efficiency level is the maximum NPV level
because the next higher level had a negative NPV. In cases where the
maximum NPV efficiency level is the penultimate efficiency level and
the max-tech level showed a positive NPV the TSL 4 efficiency level is
also the max-tech level.
TSL 3 was chosen to represent the group of efficiency levels with
the highest customer NPV at a 7-percent discount rate.
TSL 2 was selected to provide intermediate efficiency levels that
fill the gap between the TSLs 1 and 3. Note that with the number of
efficiency levels available for each equipment class, there is often
overlap between TSL levels. Thus, TSL 2 includes levels that overlap
with both TSLs 1 and 3. The intent of TSL 2 is to provide an
intermediate level to preclude big jumps in efficiency between TSLs 1
and 3.
TSL 1 was set equal to efficiency level 2. In the analysis,
efficiency level 2 was set equivalent to ENERGY STAR for products rated
by ENERGY STAR, and an equivalent efficiency improvement for other
equipment classes.
Table V.1--Mapping Between TSLs and Efficiency Levels *
--------------------------------------------------------------------------------------------------------------------------------------------------------
Equipment class TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
--------------------------------------------------------------------------------------------------------------------------------------------------------
IMH-W-Small-B...................... Level 2............... Level 3............... Level 5.............. Level 5.............. Level 6
IMH-W-Med-B........................ Level 2............... Level 2............... Level 3.............. Level 4.............. Level 5
IMH-W-Large-B [dagger]
IMH-W-Large-B1................. Level 2............... Level 2............... Level 2.............. Level 3.............. Level 4
IMH-W-Large-B2................. Level 2............... Level 2............... Level 2.............. Level 3.............. Level 4
IMH-A-Small-B...................... Level 2............... Level 3............... Level 5.............. Level 6.............. Level 7
IMH-A-Large-B [dagger]
IMH-A-Large-B1................. Level 2............... Level 3............... Level 5.............. Level 6.............. Level 6
IMH-A-Large-B2................. Level 2............... Level 2............... Level 3.............. Level 4.............. Level 4
RCU-Large-B [dagger]
RCU-Large-B1................... Level 2............... Level 2............... Level 3.............. Level 4.............. Level 5
RCU-Large-B2................... Level 2............... Level 2............... Level 3.............. Level 4.............. Level 5
SCU-W-Large-B...................... Level 2............... Level 3............... Level 5.............. Level 6.............. Level 7
SCU-A-Small-B...................... Level 2............... Level 4............... Level 6.............. Level 7.............. Level 7
SCU-A-Large-B...................... Level 2............... Level 4............... Level 6.............. Level 7.............. Level 7
IMH-A-Small-C...................... Level 2............... Level 3............... Level 4.............. Level 5.............. Level 7
IMH-A-Large-C...................... Level 2............... Level 3............... Level 5.............. Level 6.............. Level 7
SCU-A-Small-C...................... Level 2............... Level 3............... Level 4.............. Level 4.............. Level 6
--------------------------------------------------------------------------------------------------------------------------------------------------------
* For three large equipment classes--IMH-W-Large-B, IMH-A-Large-B and RCU-Large-B--because the harvest capacity range is so wide DOE analyzed two
typical models to ensure models at the low and the higher portions of the applicable range were accurately modeled. The smaller of the two is noted as
B1 and the larger as B2.
[dagger] DOE analyzed impacts for the B1 and B2 typical units and aggregated impacts to the equipment class level.
Table V.2 illustrates the efficiency improvements incorporated in
all efficiency levels.
Table V.2--Percentage Efficiency Improvement From Baseline by TSL *
----------------------------------------------------------------------------------------------------------------
Equipment class TSL 1 (%) TSL 2 (%) TSL 3 (%) TSL 4 (%) TSL 5 (%)
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B.................................. 10.0 15.0 25.0 25.0 29.4
[[Page 14911]]
IMH-W-Med-B.................................... 10.0 10.0 15.0 20.0 21.3
IMH-W-Large-B.................................. 10.0 10.0 10.0 15.0 16.4
IMH-W-Large-B1............................. 10.0 10.0 10.0 15.0 16.7
IMH-W-Large-B2............................. 10.0 10.0 10.0 15.0 15.5
IMH-A-Small-B.................................. 10.0 15.0 25.0 30.0 31.3
IMH-A-Large-B.................................. 10.0 14.2 23.4 28.0 28.0
IMH-A-Large-B1............................. 10.0 15.0 25.0 29.4 29.4
IMH-A-Large-B2............................. 10.0 10.0 15.0 20.0 20.0
RCU-Large-B.................................... 9.0 9.0 15.0 20.0 20.6
RCU-Large-B1............................... 9.0 9.0 15.0 20.0 20.6
RCU-Large-B2............................... 9.0 9.0 15.0 20.0 20.5
SCU-W-Large-B.................................. 7.0 15.0 25.0 30.0 30.2
SCU-A-Small-B.................................. 7.0 20.0 30.0 39.3 39.3
SCU-A-Large-B.................................. 7.0 20.0 30.0 34.9 34.9
IMH-A-Small-C.................................. 10.0 15.0 20.0 25.0 31.0
IMH-A-Large-C.................................. 10.0 15.0 25.0 30.0 30.2
SCU-A-Small-C.................................. 7.0 15.0 20.0 20.0 28.2
----------------------------------------------------------------------------------------------------------------
* Percentage improvements for IMH-W-Large-B, IMH-A-Large-B and RCU-Large-B are a weighted average of the B1 and
B2 units, using weights provided in TSD chapter 7.
Table V.3 illustrates the design options associated with each TSL
level, for each analyzed product class. The design options are
discussed in Section IV.D.3 of today's NOPR, and in Chapter 5 of the
NOPR TSD.
Table V.3--Design Options for Analyzed Products Classes at Each TSL
--------------------------------------------------------------------------------------------------------------------------------------------------------
Equipment class Baseline TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
--------------------------------------------------------------------------------------------------------------------------------------------------------
Design Options for Each TSL (options are cumulative--TSL5 includes all preceding options)
--------------------------------------------------------------------------------------------------------------------------------------------------------
IMH-W-Small-B................... No BW Fill, PSC PM Increase Comp EER, Same as previous.. Increase Cond, BW BW Fill, Increase ECM PM, DWHX.
Increase Cond. Fill. Evap, ECM PM.
IMH-W-Med-B..................... BW Fill, PSC PM... Increase Comp EER. Same as previous.. Increase Comp EER, Increase Comp EER, DWHX.
Increase Cond. ECM PM, DWHX.
IMH-W-Large-B1.................. BW Fill, PSC PM... Increase Comp EER, Same as previous.. Same as previous.. Increase Cond, ECM DWHX.
Increase Cond. PM, DWHX.
IMH-W-Large-B2.................. BW Fill, PSC PM... Increase Comp EER, Same as previous.. Same as previous.. ECM PM, DWHX...... DWHX.
Increase Cond.
IMH-A-Small-B................... BW Fill, PSC PM, Increase Comp EER, Increase Evap..... Increase Evap, PSC Increase Cond, ECM DWHX.
SPM FM. Increase Cond, FM, ECM FM, PM, DWHX.
Increase Evap. Increase Cond.
IMH-A-Large-B1.................. BW Fill, PSC PM, PSC FM, Comp EER.. Increase Comp EER. Increase Comp EER, Increase Cond, DWHX.
SPM FM. BW Fill, ECM PM, DWHX.
ECM FM, Increase
Cond.
IMH-A-Large-B2.................. BW Fill, PSC PM, Increase Comp EER, Same as previous.. PSC FM, Increase ECM FM, ECM PM, ECM FM, ECM PM,
SPM FM. PSC FM. Cond. DWHX. DWHX.
RCU-Large-B1.................... BW Fill, PSC PM, Increase Comp EER. Same as previous.. Increase Comp EER, ECM FM, Increase DWHX.
PSC FM. Increase Cond, Cond, ECM PM,
ECM FM. DWHX.
RCU-Large-B2.................... BW Fill, PSC PM, Increase Comp EER, Same as previous.. ECM PM Increase Increase Cond, ECM DWHX.
PSC FM. Increase Cond. Cond. FM, DWHX.
SCU-W-Large-B................... No BW Fill, PSC PM BW Fill........... BW Fill, Increase Increase Cond, ECM ECM PM, DWHX...... DWHX.
Comp EER, PM.
Increase Cond.
SCU-A-Small-B................... No BW Fill, PSC PSC FM, Increase Increase Cond, Increase Comp EER, BW Fill, ECM PM, Same as previous.
PM, SPM FM. Cond. Increase Comp EER. BW Fill. ECM FM, DWHX.
SCU-A-Large-B................... No BW Fill, PSC Increase Comp EER. Increase Comp EER, BW Fill, PSC FM, ECM PM, DWHX...... Same as previous.
PM, SPM FM. Increase Cond, BW ECM FM, ECM PM.
Fill.
[[Page 14912]]
IMH-A-Small-C................... PSC AM, SPM FM.... PSC FM, Increase PSC FM, Increase Increase Comp EER, ECM FM, ECM AM.... ECM AM.
Comp EER. Comp EER. Increase Cond,
ECM FM.
IMH-A-Large-C................... PSC AM, SPM FM.... Increase Cond, Increase Comp EER. Increase Comp EER, ECM FM, ECM AM.... ECM AM.
Increase Comp EER. PSC FM, ECM FM.
SCU-A-Small-C................... PSC AM, SPM FM.... Increase Cond..... Increase Cond, Increase Comp EER, Same as previous.. ECM FM, ECM AM.
Increase Comp EER. PSC FM.
--------------------------------------------------------------------------------------------------------------------------------------------------------
SPM = Shaded Pole Motor
PSC = Permanent Split Capacitor Motor
ECM = Electronically Commutated Motor
FM = Fan Motor (Air-Cooled Units)
PM = Pump Motor (Batch Units)
AM = Auger Motor (Continuous Units)
BW Fill = Batch Water Fill Option Included
Increase Cond = Increase in Condenser Size
Increase Evap = Increase in Evaporator Size
Increase Comp EER = Increase in Compressor EER
DWHX = Addition of Drainwater Heat Exchanger
DOE requests comment and data related to the required equipment
size increases associated with the design options at each TSL levels.
Chapter 5 of the NOPR TSD contains full descriptions of the design
options and DOE's analyses for the equipment size increase associated
with the design options selected. DOE also requests comments and data
on the efficiency gains associated with each set of design options.
Chapter 5 of the NOPR TSD contains DOE's analyses of the efficiency
gains for each design option considered. Finally, DOE requests comment
and data on any utility impacts associated with each set of design
options, such as potential ice-style changes.
2. Trial Standard Level Equations
Table V.4 and Table V.5 translate the TSLs into potential
standards. In Table V.4, the TSLs are translated into energy
consumption standards for the directly analyzed (primary) equipment
classes. Table V.5. provides the equipment class mapping showing which
of the directly analyzed standards' results were used to extend
standards to secondary classes. Table V.6 extends the standards to the
remaining (secondary) equipment classes that have not been analyzed
directly.
Table V.4--Potential Energy Consumption Standards for Directly Analyzed Classes
--------------------------------------------------------------------------------------------------------------------------------------------------------
Equipment class TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
--------------------------------------------------------------------------------------------------------------------------------------------------------
IMH-W-Small-B...................... 7.01-0.0050H.......... 6.62-0.0047H.......... 5.84-0.0041H......... 5.84-0.0041H......... 5.49-0.0039H.
IMH-W-Med-B........................ 5.04-0.0010H.......... 4.65-0.0007H.......... 3.88-0.0002H......... 3.98-0.0004H......... 3.63-0.0002H.
IMH-W-Large-B...................... 3.6................... 3.6................... 3.6.................. 3.4.................. 3.3.
IMH-A-Small-B...................... 9.23-0.0077H.......... 8.74-0.0073H.......... 7.70-0.0065H......... 7.18-0.0060H......... 7.05-0.0059H.
IMH-A-Large-B...................... 6.20-0.0010H.......... 5.86-0.0009H.......... 5.17-0.0008H......... 4.82-0.0008H......... 4.74-0.0008H.
IMH-A-Extended-B................... (>= 2,500 and <4,000) (>=1,240 and <1,975) (>=875 and <2,210) (>=815 and <2,455) (>=710 and <2,455)
3.7; 4.7; (>=1,975 and 4.5; (>=2,210 and 4.2; (>=2,455 and 4.2; (>=2,455 and
<2,500) 6.89-0.0011H; <2,500) 6.89- <2,500) 6.89- <2,500) 6.89-
(>= 2,500) 4.1. 0.0011H; (>= 2,500) 0.0011H; (>= 2,500) 0.0011H; (>= 2,500)
4.1. 4.1. 4.1.
RCU-NRC-Large-B.................... 4.6................... 4.6................... 4.3.................. 4.1.................. 4.1.
SCU-W-Large-B...................... 7.1................... 6.5................... 5.7.................. 5.3.................. 5.3.
SCU-A-Small-B...................... 16.74-0.0436H......... 14.40-0.0375H......... 12.6-0.0328H......... 10.34-0.0227H........ 10.34-0.0227H.
SCU-A-Large-B...................... 9.1................... 7.8................... 6.9.................. 6.4.................. 6.4.
IMH-A-Small-C...................... 9.90-0.0057H.......... 9.35-0.0053H.......... 9.24-0.0061H......... 8.69-0.0058H......... 7.55-0.0042H.
IMH-A-Large-C...................... 5.9................... 5.6................... 5.0.................. 4.6.................. 4.6.
SCU-A-Small-C...................... 10.70-0.0058H......... 9.75-0.0053H.......... 9.20-0.0050H......... 9.20-0.0050H......... 8.26-0.0045H.
--------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 14913]]
Table V.5--Directly Analyzed Equipment Classes Used To Develop Standards
for Secondary Classes
------------------------------------------------------------------------
Directly analyzed product
class associated with
Secondary equipment class efficiency level for
secondary product class
------------------------------------------------------------------------
RCU-NRC-Small-B.......................... RCU-NRC-Large-B.
RCU-RC-Small-B........................... RCU-NRC-Large-B.
RCU-RC-Large-B........................... RCU-NRC-Large-B.
SCU-W-Small-B............................ SCU-W-Large-B.
IMH-W-Small-C............................ IMH-A-Large-C.
IMH-W-Large-C............................ IMH-A-Large-C.
RCU-NRC-Small-C.......................... IMH-A-Large-C.
RCU-NRC-Large-C.......................... IMH-A-Large-C.
RCU-RC-Small-C........................... IMH-A-Large-C.
RCU-RC-Large-C........................... IMH-A-Large-C.
SCU-W-Small-C............................ SCU-A-Small-C.
SCU-W-Large-C............................ SCU-A-Small-C.
SCU-A-Large-C............................ SCU-A-Small-C.
------------------------------------------------------------------------
Table V.6--Potential Energy Consumption Standards for Secondary Classes
--------------------------------------------------------------------------------------------------------------------------------------------------------
Equipment class TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
--------------------------------------------------------------------------------------------------------------------------------------------------------
RCU-NRC-Small-B.................... 8.04-0.0034H.......... 8.04-0.0034H.......... 7.52-0.0032H......... 7.08-0.0030H......... 7.05-0.0030H.
RCU-RC-Small-B..................... 8.02-0.0034H.......... 8.02-0.0034H.......... 7.52-0.0032H......... 7.08-0.0030H......... 7.06-0.0030H.
RCU-RC-Large-B..................... 4.8................... 4.8................... 4.5.................. 4.3.................. 4.3.
SCU-W-Small-B...................... 10.60-0.0177H......... 9.69-0.0162H.......... 8.55-0.0143H......... 7.98-0.0133H......... 7.96-0.0133H.
IMH-W-Small-C...................... 7.29-0.0030H.......... 6.86-0.0028H.......... 6.08-0.0025H......... 5.67-0.0023H......... 5.65-0.0023H.
IMH-W-Large-C...................... 4.6................... 4.3................... 3.8.................. 3.6.................. 3.6.
RCU-NRC-Small-C.................... 9.00-0.0041H.......... 8.50-0.0039H.......... 7.5-0.0034H.......... 7.00-0.0032H......... 6.98-0.0032H.
RCU-NRC-Large-C.................... 5.5................... 5.2................... 4.6.................. 4.3.................. 4.3.
RCU-RC-Small-C..................... 9.18-0.0041H.......... 8.67-0.0039H.......... 7.65-0.0034H......... 7.14-0.0031H......... 7.12-0.0031H.
RCU-RC-Large-C..................... 5.7................... 5.4................... 4.8.................. 4.5.................. 4.5.
SCU-W-Small-C...................... 8.46-0.0031H.......... 7.74-0.0028H.......... 7.28-0.0027H......... 7.28-0.0027H......... 6.53-0.0024H.
SCU-W-Large-C...................... 5.7................... 5.2................... 4.9.................. 4.9.................. 4.4.
SCU-A-Large-C...................... 6.6................... 6.0................... 5.7.................. 5.7.................. 5.1.
--------------------------------------------------------------------------------------------------------------------------------------------------------
In developing TSLs, DOE analyzed each equipment class separately,
and attributed a percentage reduction with each portion of the standard
curve (small/medium/large). To ensure that the standard curve remained
connected (no gaps at the breakpoints), DOE developed a method for
expressing the consumption standards that relied on pivoting the low-
capacity equipment classes about a representative point. DOE was able
to use the same methodology for most equipment classes, with exceptions
for IMH-W-B, IMH-A-B, and RCU-RC equipment classes.
In drawing a relationship between the harvest capacity (lb ice/24
hours) and the maximum allowed energy usage (kilowatt-hours per 100 lb
of ice), DOE first took the large-capacity equipment class (which is
set at a constant value for all equipment types except IMH-A) and
applied the allocated percentage reduction (percentage reduction
associated with the TSL for that equipment class). For example, for
IMH-W-Large-B, the baseline level is set at 4.0. If the TSL allocated a
10-percent reduction for IMH-W-Large-B, then the next level was set at
4.0 x (1-10 percent) = 3.6 kWh/100 lb of ice.
Then, for the small equipment classes, DOE applied the allocated
percentage reduction at a designated median capacity in that harvest
rate range. The medium capacity was selected based on shipment levels,
and where the median fell within the shipments data. For example, if
the median capacity for the small equipment class was at 300 lb ice/24
hours, DOE would calculate the baseline energy usage and then apply the
allocated percentage reduction to obtain a point at 300 lb ice/24
hours. DOE would then draw a line between the start of the large
equipment class and this median capacity point to obtain the equation
for the small equipment class, ensuring that there were no gaps between
small and large-capacity.
For the IMH-W-B equipment classes, this equipment type has small,
medium, and large equipment classes. In this case, for the small
equipment class, DOE applied the allocated percentage reduction to the
whole equation. So if the percentage reduction was 10 percent, the new
equation for the small equipment class would be (1-10 percent) x (7.80
- 0.0055H) = 7.02 - 0.00495H. DOE would then draw a line between the
end of the small equipment class and the start of the large equipment
class, to obtain the equation for the medium equipment class.
For the IMH-A-B equipment classes, DOE sought to obtain a constant
efficiency level for the largest equipment classes. This calculation is
discussed in section IV.B.1.b.
For the RCU-RC-B and RCU-RC-C equipment classes, DOE simply took
the standard levels calculated for the large RCU-NRC-B and RCU-NRC-C
equipment classes, respectively, and subtracted the 0.2 kWh/100 lb of
ice differential discussed in section IV.B.1.e, to arrive at the
standard levels. For the small RCU classes, the remote compressor
standards were developed such that no gap exists at the harvest rate
breakpoints.
Using the typical unit size for directly analyzed equipment
classes, the potential standards shown on Table V.4, DOE estimates
energy usage for equipment within each class to be as shown on Table
V.7.
[[Page 14914]]
Table V.7--Energy Consumption by TSL for the Representative Automatic Commercial Ice Maker Units
----------------------------------------------------------------------------------------------------------------
Energy consumption of the representative automatic commercial
Representative ice maker unit kWh/100 lb
Equipment class harvest rate lb ----------------------------------------------------------------
ice/24 hours TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B................ 300............. 5.5 5.2 4.6 4.6 4.3
IMH-W-Med-B.................. 850............. 4.2 4.0 3.7 3.6 3.5
IMH-W-Large-B-1.............. 1500............ 3.6 3.6 3.6 3.4 3.3
IMH-W-Large-B-2.............. 2600............ 3.6 3.6 3.6 3.4 3.3
IMH-A-Small-B................ 300............. 6.9 6.5 5.8 5.4 5.3
IMH-A-Large-B-1.............. 800............. 5.4 5.1 4.5 4.2 4.1
IMH-A-Large-B-2.............. 1500............ 3.7 4.7 4.5 4.2 4.2
RCU-Large-B-1................ 1500............ 4.6 4.6 4.3 4.1 4.1
RCU-Large-B-2................ 2400............ 4.6 4.6 4.3 4.1 4.1
SCU-W-Large-B................ 300............. 7.1 6.5 5.7 5.3 5.3
SCU-A-Small-B................ 110............. 11.9 10.3 9.0 7.8 7.8
SCU-A-Large-B................ 200............. 9.1 7.8 6.9 6.4 6.4
IMH-A-Small-C................ 310............. 8.1 7.7 7.3 6.9 6.2
IMH-A-Large-C................ 820............. 5.9 5.6 5.0 4.6 4.6
SCU-A-Small-C................ 110............. 10.1 9.2 8.7 8.7 7.8
----------------------------------------------------------------------------------------------------------------
B. Economic Justification and Energy Savings
1. Economic Impacts on Commercial Customers
a. Life-Cycle Cost and Payback Period
Customers affected by new or amended standards usually incur higher
purchase prices and lower operating costs. DOE evaluates these impacts
on individual customers by calculating changes in LCC and the PBP
associated with the TSLs. The results of the LCC analysis for each TSL
were obtained by comparing the installed and operating costs of the
equipment in the base-case scenario (scenario with no amended energy
conservation standards) against the standards-case scenarios at each
TSL. The energy consumption values for both the base-case and
standards-case scenarios were calculated based on the DOE test
procedure conditions specified in the 2012 test procedure final rule,
which adopts an industry-accepted test method. Using the approach
described in section IV.G, DOE calculated the LCC savings and PBPs for
the TSLs considered in this NOPR. The LCC analysis is carried out in
the form of Monte Carlo simulations. Consequently, the results of LCC
analysis are distributed over a range of values, as opposed to a single
deterministic value. DOE presents the mean or median values, as
appropriate, calculated from the distributions of results.
Table V.8 through Table V.25 show the results of the LCC analysis
for each equipment class. Each table presents the results of the LCC
analysis, including mean LCC, mean LCC savings, median PBP, and
distribution of customer impacts in the form of percentages of
customers who experience net cost, no impact, or net benefit.
Only two equipment classes have negative LCC savings values at TSL
5: SCU-A-Small-C and IMH-A-Small-C. Negative average LCC savings imply
that, on average, customers experience an increase in LCC of the
equipment as a consequence of buying equipment associated with that
particular TSL. In many cases, the TSL 5 level is not negative, but the
LCC savings are sharply lower than the TSL 3 levels. For IMH-W-Small-B,
SCU-W-Large-B, and SCU-A-Small-B, the TSL 5 LCC savings are less than
one-third the TSL 3 savings. In other cases, such as IMH-W-Large-B2,
IMH-A-Small-B, SCU-A-Large-B, and IMH-A-Large-C, the TSL 5 LCC savings
are roughly one-half of the TSL 3 LCC savings or less. All of these
results indicate the cost increments associated with the max-tech
design option are high, and the increase in LCC (and corresponding
decrease in LCC savings) indicates that this design option may result
in negative customer impacts. TSL 5 is associated with the max-tech
level for all the equipment classes. Drain water heat exchanger
technology is the design option associated with the max-tech efficiency
levels for batch equipment classes. For continuous equipment classes,
the max-tech design options are auger motors using permanent magnets.
The mean LCC savings associated with TSL 4 are all positive values
for all equipment classes. The mean LCC savings at all lower TSL levels
are also positive. The trend is generally an increase in LCC savings
for TSL 1 through 3, with LCC savings either remaining constant or
declining at TSL 4. In three cases, the highest LCC savings are at TSL
2: IMH-A-Large-B2, RCU-Large-B2, and SCU-A-Large-B. The drop-off in LCC
savings at TSL 4 is generally associated with the relatively large cost
for the max-tech design options, the savings for which frequently span
the last two efficiency levels.
As described in section IV.H.2, DOE used a ``roll-up'' scenario in
this rulemaking. Under the roll-up scenario, DOE assumes that the
market shares of the efficiency levels (in the base case) that do not
meet the standard level under consideration would be ``rolled up'' into
(meaning ``added to'') the market share of the efficiency level at the
standard level under consideration, and the market shares of efficiency
levels that are above the standard level under consideration would
remain unaffected. Customers, in the base-case scenario, who buy the
equipment at or above the TSL under consideration, would be unaffected
if the amended standard were to be set at that TSL. Customers, in the
base-case scenario, who buy equipment below the TSL under consideration
would be affected if the amended standard were to be set at that TSL.
Among these affected customers, some may benefit from lower LCC of the
equipment and some may incur net cost due to higher LCC, depending on
the inputs to LCC analysis such as electricity prices, discount rates,
installation costs, and markups. DOE's results indicate that, with one
exception, customers either benefit or are unaffected by setting
standards at TSLs 1, 2, or 3, and at TSL 4 in the case of SCU-A-Small-
C. Customers either benefit or are unaffected at all 5 TSLs in the case
of IMH-W-Large-B1. In the case of IMH-W-Small-B, 3 percent of
[[Page 14915]]
customers are projected to experience a net cost at TSL 3. A large
percentage of customers in batch equipment classes are unaffected by a
standard set at TSL 1 given the equivalence to ENERGY STAR and the
prevalence of ENERGY STAR qualifying equipment in those classes. At the
other end of the range, in almost all cases, a portion of the market
would experience net costs starting with TSL 4, although generally the
portion experiencing a net cost is fairly low. At TSL 5, the range is
wide, with all customers either unaffected or with a net benefit for
the IMH-W-Large-B1 typical unit at one extreme and 100 percent of
customers with either a net cost or unaffected for SCU-A-Small-C. In
the cases of nine of the 18 equipment classes and/or typical unit sizes
modeled (12 classes plus 3 pairs of typical units for large, batch type
equipment classes), 20 percent or more of customers would experience a
net cost at TSL 5. In the other nine cases, the percent of customers
experiencing a net cost at TSL 5 ranges from 0 to 16 percent, with the
remaining customers either unaffected or experiencing a net benefit.
The median PBP values for TSLs 1 through 3 are all less than 2
years, except for IMH-W-Small-B where the TSL 3 PBP is 2.3 years. The
median PBP values for TSL 4 range from 1.9 years to 4.8 years.
PBP values for TSL 5 range from 2.2 years to over 19 years. SCU-A-
Small-C exhibits the longest PBP for TSL 5 at 19.1 years. IMH-A-Small-C
has a PBP of nearly 7 years, while IMH-W-Small-B has a PBP over 5
years. IMH-A-Small-B and SCU-A-Small-B both PBPs at or above 4 years
for TSL 5.
Table V.8--Summary LCC and PBP Results for IMH-W-Small-B Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Life-cycle cost, all customers 2012$ Life-cycle cost savings
--------------------------------------------------------------------------------------------------
Affected % of customers that experience Payback
TSL Energy usage Discounted customers' ------------------------------------------ period,
kWh/yr Installed operating LCC average median years
cost cost savings Net cost % No impact % Net benefit
2012$ %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1................................................................. 3,052 2,425 10,862 13,286 199 0 61 39 1.1
2................................................................. 2,884 2,451 10,740 13,191 215 0 35 65 1.3
3................................................................. 2,547 2,614 10,369 12,982 328 3 0 97 2.3
4................................................................. 2,547 2,614 10,369 12,982 328 3 0 97 2.3
5................................................................. 2,400 2,999 10,262 13,261 49 45 0 55 5.4
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Table V.9--Summary LCC and PBP Results for IMH-W-Med-B Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Life-cycle cost, all customers 2012$ Life-cycle cost savings
--------------------------------------------------------------------------------------------------
Affected % of customers that experience Payback
TSL Energy usage Discounted customers' ------------------------------------------ period,
kWh/yr Installed operating LCC average median years
cost cost savings Net cost % No impact % Net benefit
2012$ %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1................................................................. 6,507 4,241 24,859 29,100 464 0 31 69 0.6
2................................................................. 6,507 4,241 24,859 29,100 464 0 31 69 0.6
3................................................................. 6,147 4,286 24,601 28,887 587 0 14 86 0.9
4................................................................. 5,786 4,656 24,341 28,997 405 15 2 83 3.3
5................................................................. 5,691 4,671 24,272 28,943 460 11 2 87 3.2
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Table V.10--Summary LCC and PBP Results for IMH-W-Large-B Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Life-cycle cost, all customers 2012$ Life-cycle cost savings
--------------------------------------------------------------------------------------------------
Affected % of customers that experience Payback
TSL Energy usage Discounted customers' ------------------------------------------ period,
kWh/yr Installed operating LCC average median years
cost cost savings Net cost % No impact % Net benefit
2012$ %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1................................................................. 11,585 6,243 49,854 56,097 833 0 38 62 0.7
2................................................................. 11,585 6,243 49,854 56,097 833 0 38 62 0.7
3................................................................. 11,585 6,243 49,854 56,097 833 0 38 62 0.7
4................................................................. 10,943 6,813 49,390 56,202 550 8 26 66 3.6
5................................................................. 10,783 6,868 49,274 56,142 582 7 22 71 3.6
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Table V.11--Summary LCC and PBP Results for IMH-W-Large-B1 Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Life-cycle cost, all customers 2012$ Life-cycle cost savings
--------------------------------------------------------------------------------------------------
Affected % of customers that experience Payback
TSL Energy usage Discounted customers' ------------------------------------------ period,
kWh/yr Installed operating LCC average median years
cost cost savings Net cost % No impact % Net benefit
2012$ %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1................................................................. 9,877 5,132 42,919 48,051 701 0 29 71 0.7
2................................................................. 9,877 5,132 42,919 48,051 701 0 29 71 0.7
3................................................................. 9,877 5,132 42,919 48,051 701 0 29 71 0.7
4................................................................. 9,329 5,646 42,523 48,170 583 0 29 71 3.7
5................................................................. 9,147 5,717 42,392 48,109 607 0 24 76 3.8
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 14916]]
Table V.12--Summary LCC and PBP Results for IMH-W-Large-B2 Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Life-cycle cost, all customers 2012$ Life-cycle cost savings
--------------------------------------------------------------------------------------------------
Affected % of customers that experience Payback
TSL Energy usage Discounted customers' ------------------------------------------ period,
kWh/yr Installed operating LCC average median years
cost cost savings Net cost % No impact % Net benefit
2012$ %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1................................................................. 17,104 9,833 72,254 82,087 1,260 0 67 33 0.6
2................................................................. 17,104 9,833 72,254 82,087 1,260 0 67 33 0.6
3................................................................. 17,104 9,833 72,254 82,087 1,260 0 67 33 0.6
4................................................................. 16,155 10,581 71,569 82,150 442 35 17 48 3.1
5................................................................. 16,067 10,587 71,506 82,093 500 29 17 54 3.0
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Table V.13--Summary LCC and PBP Results for IMH-A-Small-B Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Life-cycle cost, all customers 2012$ Life-cycle cost savings
--------------------------------------------------------------------------------------------------
Affected % of customers that experience Payback
TSL Energy usage Discounted customers' ------------------------------------------ period,
kWh/yr Installed operating LCC average median
cost cost savings Net cost % No impact % Net benefit years
2012$ %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1................................................................. 3,806 2,475 9,046 11,521 254 0 63 37 1.1
2................................................................. 3,596 2,506 8,894 11,400 259 0 32 68 1.2
3................................................................. 3,176 2,574 8,601 11,174 396 0 0 100 1.4
4................................................................. 2,965 2,951 8,449 11,400 170 27 0 73 4.3
5................................................................. 2,909 2,964 8,408 11,372 198 22 0 78 4.2
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Table V.14--Summary LCC and PBP Results for IMH-A-Large-B Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Life-cycle cost, all customers 2012$ Life-cycle cost savings
--------------------------------------------------------------------------------------------------
Affected % of customers that experience Payback
TSL Energy usage Discounted customers' ------------------------------------------ period,
kWh/yr Installed operating LCC average median
cost cost savings Net cost % No impact % Net benefit years
2012$ %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1................................................................. 8,704 4,179 16,075 20,254 648 0 60 40 0.5
2................................................................. 8,334 4,199 15,813 20,013 633 0 23 77 0.5
3................................................................. 7,482 4,335 15,017 19,352 1,127 0 6 94 0.8
4................................................................. 7,041 4,739 14,703 19,442 994 4 2 94 2.2
5................................................................. 7,041 4,739 14,703 19,442 994 4 2 94 2.2
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Table V.15--Summary LCC and PBP Results for IMH-A-Large-B1 Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Life-cycle cost, all customers 2012$ Life-cycle cost savings
--------------------------------------------------------------------------------------------------
Affected % of customers that experience Payback
TSL Energy usage Discounted customers' ------------------------------------------ period,
kWh/yr Installed operating LCC average median
cost cost savings Net cost % No impact % Net benefit years
2012$ %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1................................................................. 7,919 4,119 15,303 19,421 590 0 59 41 0.5
2................................................................. 7,480 4,143 14,993 19,135 572 0 15 85 0.5
3................................................................. 6,603 4,279 14,143 18,421 1,168 0 0 100 0.8
4................................................................. 6,213 4,663 13,865 18,528 1,062 1 0 99 2.1
5................................................................. 6,213 4,663 13,865 18,528 1,062 1 0 99 2.1
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Table V.16--Summary LCC and PBP Results for IMH-A-Large-B2 Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Life-cycle cost, all customers 2012$ Life-cycle cost savings
--------------------------------------------------------------------------------------------------
Affected % of customers that experience Payback
TSL Energy usage Discounted customers' ------------------------------------------ period,
kWh/yr Installed operating LCC average median
cost cost savings Net cost % No impact % Net benefit years
2012$ %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1................................................................. 12,932 4,505 20,234 24,739 960 0 67 33 0.4
2................................................................. 12,932 4,505 20,234 24,739 960 0 67 33 0.4
3................................................................. 12,215 4,641 19,725 24,366 908 0 40 60 0.9
4................................................................. 11,498 5,151 19,217 24,368 627 16 13 70 2.6
5................................................................. 11,498 5,151 19,217 24,368 627 16 13 70 2.6
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 14917]]
Table V.17--Summary LCC and PBP Results for RCU-Large-B Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Life-cycle cost, all customers 2012$ Life-cycle cost savings
--------------------------------------------------------------------------------------------------
Affected % of customers that experience Payback
TSL Energy usage Discounted customers' ------------------------------------------ period,
kWh/yr Installed operating LCC average median
cost cost savings Net cost % No impact % Net benefit years
2012$ %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1................................................................. 13,205 6,321 16,686 23,007 875 0 58 42 0.4
2................................................................. 13,205 6,321 16,686 23,007 875 0 58 42 0.4
3................................................................. 12,335 6,406 16,063 22,469 983 0 18 82 0.6
4................................................................. 11,611 6,934 15,551 22,485 870 6 10 85 2.4
5................................................................. 11,526 6,968 15,490 22,458 897 5 10 85 2.4
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Table V.18--Summary LCC and PBP Results for RCU-Large-B1 Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Life-cycle cost, all customers 2012$ Life-cycle cost savings
--------------------------------------------------------------------------------------------------
Affected % of customers that experience Payback
TSL Energy usage Discounted customers' ------------------------------------------ period,
kWh/yr Installed operating LCC average median
cost cost savings Net cost % No impact % Net benefit years
2012$ %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1................................................................. 12,727 6,135 16,214 22,349 847 0 57 43 0.4
2................................................................. 12,727 6,135 16,214 22,349 847 0 57 43 0.4
3................................................................. 11,889 6,214 15,614 21,828 963 0 18 82 0.6
4................................................................. 11,191 6,722 15,119 21,840 857 6 9 85 2.4
5................................................................. 11,108 6,756 15,059 21,815 882 5 9 86 2.4
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Table V.19--Summary LCC and PBP Results for RCU-Large-B2 Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Life-cycle cost, all customers 2012$ Life-cycle cost savings
--------------------------------------------------------------------------------------------------
Affected % of customers that experience Payback
TSL Energy usage Discounted customers' ------------------------------------------ period,
kWh/yr Installed operating LCC average median
cost cost savings Net cost % No impact % Net benefit years
2012$ %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1................................................................. 20,349 9,105 23,743 32,847 1,298 0 73 27 0.8
2................................................................. 20,349 9,105 23,743 32,847 1,298 0 73 27 0.8
3................................................................. 19,009 9,283 22,775 32,058 1,277 0 27 73 1.0
4................................................................. 17,892 10,108 22,017 32,124 1,070 7 18 75 2.7
5................................................................. 17,779 10,137 21,935 32,072 1,123 6 18 76 2.7
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Table V.20--Summary LCC and PBP Results for SCU-W-Large-B Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Life-cycle cost, all customers 2012$ Life-cycle cost savings
--------------------------------------------------------------------------------------------------
Affected % of customers that experience Payback
TSL Energy usage Discounted customers' ------------------------------------------ period,
kWh/yr Installed operating LCC average median
cost cost savings Net cost % No impact % Net benefit years
2012$ %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1................................................................. 3,892 3,501 12,082 15,583 483 0 71 29 0.7
2................................................................. 3,559 3,530 11,849 15,379 687 0 71 29 0.8
3................................................................. 3,143 3,596 11,548 15,144 694 0 57 43 1.0
4................................................................. 2,935 3,950 11,398 15,348 143 49 14 36 3.0
5................................................................. 2,925 3,951 11,391 15,342 149 49 14 37 3.0
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Table V.21--Summary LCC and PBP Results for SCU-A-Small-B Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Life-cycle cost, all customers 2012$ Life-cycle cost savings
--------------------------------------------------------------------------------------------------
Affected % of customers that experience Payback
TSL Energy usage Discounted customers' ------------------------------------------ period,
kWh/yr Installed operating LCC average median
cost cost savings Net cost % No impact % Net benefit years
2012$ %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1................................................................. 2,419 2,772 7,548 10,321 103 0 83 17 1.4
2................................................................. 2,084 2,821 7,320 10,141 198 0 37 63 1.5
3................................................................. 1,826 2,896 6,979 9,875 396 0 11 89 1.6
4................................................................. 1,585 3,306 6,813 10,119 106 32 0 68 4.8
5................................................................. 1,585 3,306 6,813 10,119 106 32 0 68 4.8
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 14918]]
Table V.22--Summary LCC and PBP Results for SCU-A-Large-B Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Life-cycle cost, all customers 2012$ Life-cycle cost savings
--------------------------------------------------------------------------------------------------
Affected % of customers that experience Payback
TSL Energy usage Discounted customers' ------------------------------------------ period,
kWh/yr Installed operating LCC average median
cost cost savings Net cost % No impact % Net benefit years
2012$ %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1................................................................. 3,349 3,243 10,645 13,888 140 0 71 29 1.4
2................................................................. 2,884 3,324 10,105 13,429 522 0 36 64 1.2
3................................................................. 2,526 3,405 9,857 13,262 502 0 7 93 1.5
4................................................................. 2,351 3,758 9,731 13,489 240 34 0 66 3.7
5................................................................. 2,351 3,758 9,731 13,489 240 34 0 66 3.7
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Table V.23--Summary LCC and PBP Results for IMH-A-Small-C Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Life-cycle cost, all customers 2012$ Life-cycle cost savings
--------------------------------------------------------------------------------------------------
Affected % of customers that experience Payback
TSL Energy usage Discounted customers' ------------------------------------------ period,
kWh/yr Installed operating LCC average median
cost cost savings Net cost % No impact % Net benefit years
2012$ * %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1................................................................. 4,630 6,644 9,390 16,034 315 0 77 23 0.9
2................................................................. 4,374 6,666 9,212 15,877 314 0 54 46 0.9
3................................................................. 4,118 6,694 9,031 15,726 391 0 40 60 1.0
4................................................................. 3,862 6,913 8,848 15,761 307 8 31 61 2.6
5................................................................. 3,555 7,461 8,789 16,251 (237) 73 11 16 6.8
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
* Values in parentheses are negative values.
Table V.24--Summary LCC and PBP Results for IMH-A-Large-C Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Life-cycle cost, all customers 2012$ Life-cycle cost savings
--------------------------------------------------------------------------------------------------
Affected % of customers that experience Payback
TSL Energy usage Discounted customers' ------------------------------------------ period,
kWh/yr Installed operating LCC average median
cost cost savings Net cost % No impact % Net benefit years
2012$ %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1................................................................. 8,911 5,518 15,462 20,980 660 0 65 35 0.5
2................................................................. 8,417 5,543 15,113 20,656 744 0 45 55 0.5
3................................................................. 7,430 5,630 14,426 20,055 1,026 0 15 85 0.7
4................................................................. 6,936 6,288 14,269 20,557 524 21 15 64 3.2
5................................................................. 6,912 6,289 14,262 20,552 500 21 10 69 3.2
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Table V.25--Summary LCC and PBP Results for SCU-A-Small-C Equipment Class
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Life-cycle cost, all customers 2012$ Life-cycle cost savings
--------------------------------------------------------------------------------------------------
Affected % of customers that experience Payback
TSL Energy usage Discounted customers' ------------------------------------------ period,
kWh/yr Installed operating LCC average median
cost cost savings Net cost % No impact % Net benefit years
2012$ * %
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
1................................................................. 2,040 3,603 7,243 10,846 93 0 73 27 1.1
2................................................................. 1,866 3,632 7,127 10,760 140 0 53 47 1.5
3................................................................. 1,758 3,659 7,057 10,717 146 0 37 63 1.9
4................................................................. 1,758 3,659 7,057 10,717 146 0 37 63 1.9
5................................................................. 1,580 4,196 7,099 11,295 (441) 80 20 0 19.1
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
* Values in parentheses are negative values.
b. Life-Cycle Cost Subgroup Analysis
As described in section IV.I, DOE estimated the impact of amended
energy conservation standards for automatic commercial ice makers, at
each TSL, on two customer subgroups--the foodservice sector and the
lodging sector. For the automatic commercial ice makers, DOE has not
distinguished between subsectors of the foodservice industry. In other
words, DOE has been treating it as one sector as opposed to modeling
limited or full service restaurants and other types of foodservice
firms separately. Foodservice was chosen as one representative subgroup
because of the large percentage of the industry represented by family
or locally owned restaurants. Likewise, lodging was chosen due to the
large percentage of the industry represented by locally owned, or
franchisee-owned hotels. DOE carried out two LCC subgroup analyses, one
each for restaurants and lodging, by using the LCC spreadsheet
described in chapter 8 of the NOPR, but with certain modifications. The
input for business type was fixed to the identified subgroup, which
ensured that the discount rates and electricity price rates associated
with only that subgroup were selected in the Monte Carlo simulations
(see chapter 8 of the NOPR TSD). Another major change from the LCC
analysis was an added assumption that the subgroups do not have access
to national capital markets, which results in higher discount rates for
the subgroups. The higher discount rates lead the subgroups valuing
more highly upfront equipment purchase costs relative to the future
operating cost savings. The LCC subgroup analysis is described in
chapter 8 of the NOPR TSD.
[[Page 14919]]
Table V.26 presents the comparison of mean LCC savings for the
small business subgroup in foodservice sector with the national average
values (LCC savings results from chapter 8 of the NOPR TSD). For almost
all TSLs in all equipment classes, the LCC savings for the small
business subgroup are lower than the national average values. The
exception is the TSL 5 result for SCU-A-Small-C. Table V.27 presents
the percentage change in LCC savings compared to national average
values. DOE modeled all equipment classes in this analysis, although
DOE believes it is likely that the very large equipment classes are not
commonly used in foodservice establishments. For TSLs 1 through 3, the
differences range from -2 percent to -6 percent. For all but three
equipment classes in Table V.27, the percentage decrease in LCC savings
is less than 10 percent for all TSLs. For SCU-W-Large-B, the TSL 4 and
5 differences were -11 percent. SCU-A-Small-B, the TSL 4 and 5
differences were -17 percent. For IMH-W-Small-B, the TSL 5 difference
is -37 percent.
Table V.28 presents the comparison of median PBPs for the small
business subgroup in foodservice sector with national median values
(median PBPs from chapter 8 of the NOPR TSD). The PBP values are
shorter for the small business subgroup in all cases. This arises
because the first-year operating cost savings--which are used for
payback period--are higher leading to a shorter payback, but given
their higher discount rates, these customers value future savings less,
leading to lower LCC savings. First-year savings are higher because the
foodservice electricity prices are higher than the average of all
classes.
Table V.29 presents the comparison of mean LCC savings for the
small business subgroup in lodging sector (hotels and casinos) with the
national average values (LCC savings results from chapter 8 of the NOPR
TSD). Table V.30 presents the percentage change in LCC savings of the
lodging sector customer subgroup to national average values. For
lodging sector small business, LCC savings are lower across the board.
For TSLs 1 through 3, the lodging subgroup LCC savings range from 9 to
13 percent lower. The reason for this is that the energy price for
lodging is slightly lower than the average of all commercial business
types (97 percent of the average). This combined with a higher discount
rate reduces the nominal value of future operating and maintenance
benefits as well as the present value of the benefits, thus resulting
in lower LCC savings.
Table V.31 presents the comparison of median PBPs for small
business subgroup in the lodging sector with national median values
(median PBPs from chapter 8 of the NOPR TSD). The PBP values are
slightly higher in the lodging small business subgroup in all
instances. As noted above, the energy savings would be lower in nominal
terms than a national average Thus, the slightly lower median PBP
appears to be a result of a narrower electricity saving results
distribution that is close to but below the national average.
Table V.26--Comparison of Mean LCC Savings for the Foodservice Sector Small Business Subgroup With the National
Average Values
----------------------------------------------------------------------------------------------------------------
Mean LCC savings 2012$ *
Equipment class Category -----------------------------------------------------------
TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B................... Small Business.... 195 210 312 312 31
All Business Types 199 215 328 328 49
IMH-W-Med-B..................... Small Business.... 455 455 575 390 443
All Business Types 464 464 587 405 460
IMH-W-Large-B................... Small Business.... 816 816 816 528 559
All Business Types 833 833 833 550 582
IMH-W-Large-B1.................. Small Business.... 687 687 687 561 585
All Business Types 701 701 701 583 607
IMH-W-Large-B2.................. Small Business.... 1,233 1,233 1,233 419 476
All Business Types 1,260 1,260 1,260 442 500
IMH-A-Small-B................... Small Business.... 249 253 387 159 185
All Business Types 254 259 396 170 198
IMH-A-Large-B................... Small Business.... 635 621 1,094 956 956
All Business Types 648 633 1,127 994 994
IMH-A-Large-B1.................. Small Business.... 578 561 1,132 1,021 1,021
All Business Types 590 572 1,168 1,062 1,062
IMH-A-Large-B2.................. Small Business.... 941 941 888 604 604
All Business Types 960 960 908 627 627
RCU-Large-B..................... Small Business.... 858 858 963 843 869
All Business Types 875 875 983 870 897
RCU-Large-B1.................... Small Business.... 830 830 944 831 855
All Business Types 847 847 963 857 882
RCU-Large-B2.................... Small Business.... 1,270 1,270 1,249 1,032 1,084
All Business Types 1,298 1,298 1,277 1,070 1,123
SCU-W-Large-B................... Small Business.... 455 655 666 126 132
All Business Types 483 687 694 143 149
SCU-A-Small-B................... Small Business.... 100 194 378 88 88
All Business Types 103 198 396 106 106
SCU-A-Large-B................... Small Business.... 137 498 483 219 219
All Business Types 140 522 502 240 240
IMH-A-Small-C................... Small Business.... 308 307 383 296 (238)
All Business Types 315 314 391 307 (237)
IMH-A-Large-C................... Small Business.... 647 729 1,006 512 489
All Business Types 660 744 1,026 524 500
SCU-A-Small-C................... Small Business.... 91 137 143 143 (434)
[[Page 14920]]
All Business Types 93 140 146 146 (441)
----------------------------------------------------------------------------------------------------------------
* Values in parenthesis are negative numbers.
Table V.27--Percentage Change in Mean LCC Savings for the Foodservice Sector Small Business Subgroup Compared to
National Average Values *
----------------------------------------------------------------------------------------------------------------
Equipment class TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B.................................. (2%) (2%) (5%) (5%) (37%)
IMH-W-Med-B.................................... (2%) (2%) (2%) (4%) (4%)
IMH-W-Large-B.................................. (2%) (2%) (2%) (4%) (4%)
IMH-W-Large-B1................................. (2%) (2%) (2%) (4%) (4%)
IMH-W-Large-B2................................. (2%) (2%) (2%) (5%) (5%)
IMH-A-Small-B.................................. (2%) (2%) (2%) (7%) (6%)
IMH-A-Large-B.................................. (2%) (2%) (3%) (4%) (4%)
IMH-A-Large-B1................................. (2%) (2%) (3%) (4%) (4%)
IMH-A-Large-B2................................. (2%) (2%) (2%) (4%) (4%)
RCU-Large-B.................................... (2%) (2%) (2%) (3%) (3%)
RCU-Large-B1................................... (2%) (2%) (2%) (3%) (3%)
RCU-Large-B2................................... (2%) (2%) (2%) (3%) (3%)
SCU-W-Large-B.................................. (6%) (5%) (4%) (11%) (11%)
SCU-A-Small-B.................................. (2%) (2%) (5%) (17%) (17%)
SCU-A-Large-B.................................. (2%) (4%) (4%) (9%) (9%)
IMH-A-Small-C.................................. (2%) (2%) (2%) (3%) 0%
IMH-A-Large-C.................................. (2%) (2%) (2%) (2%) (2%)
SCU-A-Small-C.................................. (2%) (2%) (2%) (2%) 2%
----------------------------------------------------------------------------------------------------------------
* Values in parenthesis are negative numbers. Negative percentage values imply decrease in LCC savings and
positive percentage values imply increase in LCC savings.
Table V.28--Comparison of Median Payback Periods for the Foodservice Sector Small Business Subgroup With
National Median Values
----------------------------------------------------------------------------------------------------------------
Median payback period years
Equipment class Category ------------------------------------------------------
TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B..................... Small Business....... 1.02 1.20 2.16 2.16 5.14
All Business Types... 1.07 1.26 2.27 2.27 5.42
IMH-W-Med-B....................... Small Business....... 0.60 0.60 0.81 3.17 3.06
All Business Types... 0.63 0.63 0.85 3.33 3.22
IMH-W-Large-B..................... Small Business....... 0.65 0.65 0.65 3.42 3.42
All Business Types... 0.69 0.69 0.69 3.59 3.60
IMH-W-Large-B1.................... Small Business....... 0.68 0.68 0.68 3.57 3.59
All Business Types... 0.72 0.72 0.72 3.75 3.77
IMH-W-Large-B2.................... Small Business....... 0.55 0.55 0.55 2.95 2.88
All Business Types... 0.58 0.58 0.58 3.10 3.02
IMH-A-Small-B..................... Small Business....... 1.02 1.16 1.35 4.11 4.03
All Business Types... 1.07 1.22 1.42 4.32 4.24
IMH-A-Large-B..................... Small Business....... 0.44 0.47 0.80 2.06 2.06
All Business Types... 0.46 0.49 0.84 2.16 2.16
IMH-A-Large-B1.................... Small Business....... 0.44 0.48 0.78 1.99 1.99
All Business Types... 0.46 0.50 0.82 2.08 2.08
IMH-A-Large-B2.................... Small Business....... 0.40 0.40 0.90 2.45 2.45
All Business Types... 0.42 0.42 0.94 2.58 2.58
RCU-Large-B....................... Small Business....... 0.39 0.39 0.62 2.27 2.32
All Business Types... 0.41 0.41 0.65 2.39 2.44
RCU-Large-B1...................... Small Business....... 0.37 0.37 0.59 2.25 2.31
All Business Types... 0.38 0.38 0.62 2.37 2.42
RCU-Large-B2...................... Small Business....... 0.72 0.72 0.96 2.57 2.57
All Business Types... 0.75 0.75 1.00 2.70 2.70
SCU-W-Large-B..................... Small Business....... 0.65 0.73 0.96 2.87 2.86
All Business Types... 0.67 0.76 1.00 3.01 3.00
SCU-A-Small-B..................... Small Business....... 1.33 1.44 1.48 4.54 4.54
All Business Types... 1.40 1.52 1.56 4.79 4.79
SCU-A-Large-B..................... Small Business....... 1.29 1.11 1.42 3.54 3.54
[[Page 14921]]
All Business Types... 1.37 1.17 1.49 3.72 3.72
IMH-A-Small-C..................... Small Business....... 0.86 0.86 0.92 2.46 6.38
All Business Types... 0.90 0.90 0.97 2.59 6.83
IMH-A-Large-C..................... Small Business....... 0.50 0.50 0.65 3.06 3.05
All Business Types... 0.52 0.53 0.69 3.25 3.24
SCU-A-Small-C..................... Small Business....... 1.08 1.45 1.76 1.76 17.09
All Business Types... 1.13 1.53 1.85 1.85 19.12
----------------------------------------------------------------------------------------------------------------
Table V.29--Comparison of LCC Savings for the Lodging Sector Small Business Subgroup With the National Average
Values
----------------------------------------------------------------------------------------------------------------
Mean LCC savings 2012$ *
Equipment class Category ------------------------------------------------------
TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B..................... Small Business....... 179 192 285 285 (3)
All Business Types... 199 215 328 328 49
IMH-W-Med-B....................... Small Business....... 421 421 531 334 382
All Business Types... 464 464 587 405 460
IMH-W-Large-B..................... Small Business....... 756 756 756 449 476
All Business Types... 833 833 833 550 582
IMH-W-Large-B1.................... Small Business....... 635 635 635 484 503
All Business Types... 701 701 701 583 607
IMH-W-Large-B2.................... Small Business....... 1,144 1,144 1,144 338 390
All Business Types... 1,260 1,260 1,260 442 500
IMH-A-Small-B..................... Small Business....... 229 232 354 115 139
All Business Types... 254 259 396 170 198
IMH-A-Large-B..................... Small Business....... 589 575 1,018 862 862
All Business Types... 648 633 1,127 994 994
IMH-A-Large-B1.................... Small Business....... 536 520 1,056 926 926
All Business Types... 590 572 1,168 1,062 1,062
IMH-A-Large-B2.................... Small Business....... 873 873 816 521 521
All Business Types... 960 960 908 627 627
RCU-Large-B....................... Small Business....... 796 796 890 744 766
All Business Types... 875 875 983 870 897
RCU-Large-B1...................... Small Business....... 771 771 873 734 754
All Business Types... 847 847 963 857 882
RCU-Large-B2...................... Small Business....... 1,175 1,175 1,149 891 937
All Business Types... 1,298 1,298 1,277 1,070 1,123
SCU-W-Large-B..................... Small Business....... 440 624 626 96 102
All Business Types... 483 687 694 143 149
SCU-A-Small-B..................... Small Business....... 92 177 353 55 55
All Business Types... 103 198 396 106 106
SCU-A-Large-B..................... Small Business....... 126 470 448 179 179
All Business Types... 140 522 502 240 240
IMH-A-Small-C..................... Small Business....... 284 283 352 257 (281)
All Business Types... 315 314 391 307 (237)
IMH-A-Large-C..................... Small Business....... 600 676 929 412 394
All Business Types... 660 744 1,026 524 500
SCU-A-Small-C..................... Small Business....... 84 125 128 128 (452)
All Business Types... 93 140 146 146 (441)
----------------------------------------------------------------------------------------------------------------
* Values in parentheses are negative numbers.
Table V.30--Percentage Change in Mean LCC Savings for the Lodging Sector Small Business Subgroup Compared to
National Average Values *
----------------------------------------------------------------------------------------------------------------
Equipment class TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B.................................. (10%) (10%) (13%) (13%) (107%)
IMH-W-Med-B.................................... (9%) (9%) (10%) (18%) (17%)
IMH-W-Large-B.................................. (9%) (9%) (9%) (18%) (18%)
IMH-W-Large-B1................................. (9%) (9%) (9%) (17%) (17%)
IMH-W-Large-B2................................. (9%) (9%) (9%) (24%) (22%)
IMH-A-Small-B.................................. (10%) (10%) (11%) (32%) (30%)
IMH-A-Large-B.................................. (9%) (9%) (10%) (13%) (13%)
[[Page 14922]]
IMH-A-Large-B1................................. (9%) (9%) (10%) (13%) (13%)
IMH-A-Large-B2................................. (9%) (9%) (10%) (17%) (17%)
RCU-Large-B.................................... (9%) (9%) (9%) (15%) (15%)
RCU-Large-B1................................... (9%) (9%) (9%) (14%) (15%)
RCU-Large-B2................................... (9%) (9%) (10%) (17%) (16%)
SCU-W-Large-B.................................. (9%) (9%) (10%) (33%) (32%)
SCU-A-Small-B.................................. (11%) (11%) (11%) (49%) (49%)
SCU-A-Large-B.................................. (10%) (10%) (11%) (25%) (25%)
IMH-A-Small-C.................................. (10%) (10%) (10%) (16%) (18%)
IMH-A-Large-C.................................. (9%) (9%) (9%) (21%) (21%)
SCU-A-Small-C.................................. (10%) (11%) (12%) (12%) (2%)
----------------------------------------------------------------------------------------------------------------
* Values in parentheses are negative numbers. Negative percentage values imply decrease in LCC savings and
positive percentage values imply increase in LCC savings.
Table V.31--Comparison of Median Payback Periods for the Lodging Sector Small Business Subgroup With the
National Median Values
----------------------------------------------------------------------------------------------------------------
Median payback period years
Equipment class Category ------------------------------------------------------
TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B..................... Small Business....... 1.09 1.28 2.27 2.27 5.42
All Business Types... 1.07 1.26 2.27 2.27 5.42
IMH-W-Med-B....................... Small Business....... 0.64 0.64 0.86 3.38 3.26
All Business Types... 0.63 0.63 0.85 3.33 3.22
IMH-W-Large-B..................... Small Business....... 0.70 0.70 0.70 3.65 3.65
All Business Types... 0.69 0.69 0.69 3.59 3.60
IMH-W-Large-B1.................... Small Business....... 0.73 0.73 0.73 3.80 3.83
All Business Types... 0.72 0.72 0.72 3.75 3.77
IMH-W-Large-B2.................... Small Business....... 0.58 0.58 0.58 3.14 3.07
All Business Types... 0.58 0.58 0.58 3.10 3.02
IMH-A-Small-B..................... Small Business....... 1.08 1.24 1.44 4.39 4.30
All Business Types... 1.07 1.22 1.42 4.32 4.24
IMH-A-Large-B..................... Small Business....... 0.46 0.50 0.85 2.19 2.19
All Business Types... 0.46 0.49 0.84 2.16 2.16
IMH-A-Large-B1.................... Small Business....... 0.47 0.51 0.83 2.11 2.11
All Business Types... 0.46 0.50 0.82 2.08 2.08
IMH-A-Large-B2.................... Small Business....... 0.43 0.43 0.96 2.61 2.61
All Business Types... 0.42 0.42 0.94 2.58 2.58
RCU-Large-B....................... Small Business....... 0.41 0.41 0.66 2.42 2.48
All Business Types... 0.41 0.41 0.65 2.39 2.44
RCU-Large-B1...................... Small Business....... 0.39 0.39 0.63 2.40 2.46
All Business Types... 0.38 0.38 0.62 2.37 2.42
RCU-Large-B2...................... Small Business....... 0.77 0.77 1.02 2.74 2.74
All Business Types... 0.75 0.75 1.00 2.70 2.70
SCU-W-Large-B..................... Small Business....... 0.67 0.75 1.01 3.01 3.00
All Business Types... 0.67 0.76 1.00 3.01 3.00
SCU-A-Small-B..................... Small Business....... 1.42 1.54 1.56 4.79 4.79
All Business Types... 1.40 1.52 1.56 4.79 4.79
SCU-A-Large-B..................... Small Business....... 1.38 1.17 1.49 3.72 3.72
All Business Types... 1.37 1.17 1.49 3.72 3.72
IMH-A-Small-C..................... Small Business....... 0.92 0.92 0.99 2.63 6.88
All Business Types... 0.90 0.90 0.97 2.59 6.83
IMH-A-Large-C..................... Small Business....... 0.53 0.53 0.70 3.28 3.28
All Business Types... 0.52 0.53 0.69 3.25 3.24
SCU-A-Small-C..................... Small Business....... 1.15 1.55 1.88 1.88 19.13
All Business Types... 1.13 1.53 1.85 1.85 19.12
----------------------------------------------------------------------------------------------------------------
2. Economic Impacts on Manufacturers
DOE performed an MIA to estimate the impact of amended energy
conservation standards on manufacturers of automatic commercial ice
makers. The following section describes the expected impacts on
manufacturers at each TSL. Chapter 12 of the NOPR TSD explains the
analysis in further detail.
a. Industry Cash Flow Analysis Results
The following tables depict the financial impacts (represented by
changes in INPV) of amended energy conservation standards on
manufacturers of automatic commercial ice makers as well as the
conversion costs that DOE estimates manufacturers would incur for all
equipment classes at each TSL. To evaluate the range of cash flow
impacts on the commercial ice maker industry, DOE used two different
[[Page 14923]]
markup assumptions to model scenarios that correspond to the range of
anticipated market responses to new and amended energy conservation
standards.
To assess the lower (less severe) end of the range of potential
impacts, DOE modeled a preservation of gross margin percentage markup
scenario, in which a uniform ``gross margin percentage'' markup is
applied across all efficiency levels. In this scenario, DOE assumed
that a manufacturer's absolute dollar markup would increase as
production costs increase in the amended energy conservation standards
case. Manufacturers have indicated that it is optimistic to assume that
they would be able to maintain the same gross margin percentage markup
as their production costs increase in response to a new or amended
energy conservation standard, particularly at higher TSLs.
To assess the higher (more severe) end of the range of potential
impacts, DOE modeled the preservation of the EBIT markup scenario,
which assumes that manufacturers would not be able to preserve the same
overall gross margin, but instead cut their markup for marginally
compliant products to maintain a cost competitive product offering and
keep the same overall level of EBIT as in the base case. The two tables
below show the range of potential INPV impacts for manufacturers of
automatic commercial ice makers. The first table reflects the lower
bound of impacts (higher profitability) and the second represents the
upper bound of impacts (lower profitability).
Each scenario results in a unique set of cash flows and
corresponding industry values at each TSL. In the following discussion,
the INPV results refer to the sum of discounted cash flows through
2047, the difference in INPV between the base case and each standards
case, and the total industry conversion costs required for each
standards case.
Table V.32--Manufacturer Impact Analysis for Automatic Commercial Ice Makers--Preservation of Gross Margin
Percentage Markup Scenario *
----------------------------------------------------------------------------------------------------------------
Trial standard level
Units Base case ------------------------------------------------------
1 2 3 4 5
----------------------------------------------------------------------------------------------------------------
INPV......................... 2012$ Millions. $101.8 $93.4 $89.0 $80.9 $82.2 $81.9
Change in INPV............... 2012$ Millions. ......... $(8.4) $(12.8) $(20.9) $(19.6) $(19.9)
(%)............ ......... (8.2)% (12.6)% (20.5)% (19.2)% (19.5)%
Product Conversion Costs..... 2012$ Millions. ......... $17.0 $25.4 $38.3 $44.8 $46.9
Capital Conversion Costs..... 2012$ Millions. ......... $0.4 $1.2 $3.9 $6.4 $7.3
----------------------------------------------------------------------------------
Total Conversion Costs... 2012$ Millions. ......... $17.4 $26.6 $42.2 $51.2 $54.2
----------------------------------------------------------------------------------------------------------------
* Values in parentheses are negative numbers.
Table V.33--Manufacturer Impact Analysis for Automatic Commercial Ice Makers--Preservation of EBIT Markup
Scenario *
----------------------------------------------------------------------------------------------------------------
Trial standard level
Units Base case ------------------------------------------------------
1 2 3 4 5
----------------------------------------------------------------------------------------------------------------
INPV......................... 2012$ Millions. $101.8 $93.1 $88.2 $77.9 $71.3 $69.2
Change in INPV............... 2012$ Millions. ......... $(8.7) $(13.6) $(23.9) $(30.5) $(32.6)
(%)............ ......... (8.5)% (13.4)% (23.5)% (30.0)% (32.0)%
Product Conversion Costs..... 2012$ Millions. ......... $17.0 $25.4 $38.3 $44.8 $46.9
Capital Conversion Costs..... 2012$ Millions. ......... $0.4 $1.2 $3.9 $6.4 $7.3
----------------------------------------------------------------------------------
Total Conversion Costs... 2012$ Millions. ......... $17.4 $26.6 $42.2 $51.2 $54.2
----------------------------------------------------------------------------------------------------------------
* Values in parentheses are negative numbers.
Beyond impacts on INPV, DOE includes a comparison of free cash flow
between the base case and the standards case at each TSL in the year
before amended standards take effect to provide perspective on the
short-run cash flow impacts in the discussion of the results below.
At TSL 1, DOE estimates impacts on INPV for manufacturers of
automatic commercial ice makers to range from -$8.4 million to -$8.7
million, or a change in INPV of -8.2 percent to -8.5 percent. At this
TSL, industry free cash flow is estimated to decrease by approximately
61 percent to $3.3 million, compared to the base-case value of $8.4
million in the year before the compliance date (2017).
DOE estimates that approximately 40 percent of all batch commercial
ice makers and 30 percent of all continuous commercial ice makers on
the market will require redesign to meet standards at TSL 1.
Additionally, for both batch and continuous products, the number of
products requiring redesign at this TSL is commensurate with each
manufacturer's estimated market share. Twelve manufacturers, including
three small businesses, produce equipment that complies with the
efficiency levels specified at TSL 1.
At TSL 1, the majority of efficiency gains could be made through
swapping purchased components for higher efficiency equivalents. It is
expected that very few evaporators and condensers are affected at TSL
1, leading to very low expected industry capital conversion costs
totaling only $0.4 million. However, moderate product conversion costs
of $17.0 million are expected, as redesigned units will require low
levels of engineering design labor, as well as testing for equipment
certification.
At TSL 2, DOE estimates impacts on INPV for manufacturers of
automatic commercial ice makers to range from -$12.8 million to -$13.6
million, or a change in INPV of -12.6 percent to -13.4 percent. At this
TSL, industry free cash flow is estimated to decrease by approximately
97 percent to $0.2 million, compared to the base-case
[[Page 14924]]
value of $8.4 million in the year before the compliance date (2017).
At TSL 2, total conversion costs increase to $26.6 million, 53
percent higher than those incurred by industry at TSL 1. DOE estimates
that approximately 58 percent of all units on the market will require
redesign to meet the standards outlined at TSL 2. As with TSL 1, for
batch and continuous commercial ice makers, the number of products
requiring redesign at this TSL is largely commensurate with each
manufacturer's estimated market share. Ten manufacturers, including
three small businesses, produce equipment that complies with the
efficiency levels specified at TSL 2.
The majority of redesigns still rely on switching to higher
efficiency components, but a limited number of units are expected to
require more complex system redesigns including the evaporator and
condenser. The increased, but moderate, complexity of these redesigns
causes product conversion costs to grow at a slightly higher rate than
the additional number of units requiring redesign, resulting in
industry-wide product conversion costs totaling $25.4 million. Capital
conversion costs continue to remain relatively low at $1.2 million, as
most design options considered at TSL 2 can be integrated into
production without changes to manufacturing capital.
At TSL 3, DOE estimates impacts on INPV for manufacturers of
automatic commercial ice makers to range from -$20.9 million to -$23.9
million, or a change in INPV of -20.5 percent to -23.5 percent. At this
TSL, industry free cash flow is estimated to decrease by approximately
180 percent to -$6.7 million, compared to the base-case value of $8.4
million in the year before the compliance date (2017).
At TSL 3, total conversion costs grow significantly to $42.2
million, an increase of 59 percent over those incurred by manufacturers
at TSL 2. DOE estimates that approximately 88 percent of all batch
products and 75 percent of all continuous products on the market will
require redesign to meet this TSL. Six of the 12 manufacturers of batch
equipment currently produce batch commercial ice makers that comply
with the efficiency levels specified at TSL 3. This includes one small
business manufacturer. In contrast, all six manufacturers of continuous
commercial ice makers identified produce products that comply with the
efficiency levels specified at TSL 3.
The majority of redesigns necessary to meet the standards at TSL 3
involve more complex changes to the evaporator and condenser systems.
These complex redesigns result in product conversion costs increasing
at a rate higher than simply the additional number of units that
require redesign. At TSL 3, the resulting industry product conversion
costs total $38.3 million. Additionally, capital conversion costs jump
significantly to $3.9 million, as evaporator and condenser redesigns
spur investments in tooling for both of these components and the
surrounding enclosure.
At TSL 4, DOE estimates impacts on INPV for manufacturers of
automatic commercial ice makers to range from -$19.6 million to -$30.5
million, or a change in INPV of -19.2 percent to -30.0 percent. At this
TSL, industry free cash flow is estimated to decrease by approximately
227 percent to -$10.7 million, compared to the base-case value of $8.4
million in the year before the compliance date (2017).
At TSL 4, total conversion costs grow to $51.2 million. Relative to
the change between TSLs 2 and 3, the increases in conversion costs at
TSL 4 are smaller as the percentage of batch and continuous units
requiring redesign grows to 96 percent and 77 percent, respectively.
These fractions are up from 88 percent and 75 percent, respectively, at
TSL 3. Only two manufacturers, including one small business
manufacturer, currently produce batch commercial ice makers that comply
with the efficiency levels specified at TSL 4. In contrast, all six
manufacturers of continuous commercial ice makers identified produce
products that comply with the efficiency levels specified at TSL 4.
With very few additional units needing redesigns, costs incurred
are mainly incremental, and account for the increasing complexity of
condenser and evaporator redesigns. Product conversion costs grow to
$44.8 million, 17 percent above those at TSL 3. However, the increasing
complexity of redesign does incur greater capital conversion costs,
which grow to $6.4 million as additional capital investments are
required to modify production lines to manufacture these more complex
designs.
At TSL 5, DOE estimates impacts on INPV for manufacturers of
automatic commercial ice makers to range from -$19.9 million to -$32.6
million, or a change in INPV of -19.5 percent to -32.0 percent. At this
TSL, industry free cash flow is estimated to decrease by approximately
243 percent to -$12.0 million, compared to the base-case value of $8.4
million in the year before the compliance date (2017).
As with TSL 4, only two manufacturers, including one small business
manufacturer, currently produce batch commercial ice makers that comply
with the efficiency levels specified at TSL 5. For manufacturers of
continuous commercial ice makers, this number drops from six to four.
As compared to the previous increases in required efficiency between
TSLs, the changes between TSL 4 and TSL 5 are minimal. As a result,
total conversion costs grow only slightly, rising 6 percent to $54.2
million. This consists of $46.9 million in product conversion costs and
$7.3 million in capital conversion costs.
b. Impacts on Direct Employment
DOE used the GRIM to estimate the domestic labor expenditures and
number of domestic production workers in the base case and at each TSL
from 2013 to 2047. DOE used statistical data from the most recent U.S
Census Bureau's ``Annual Survey of Manufactures,'' the results of the
engineering analysis, and interviews with manufacturers to determine
the inputs necessary to calculate industry-wide labor expenditures and
domestic employment levels. Labor expenditures for the manufacture of a
product are a function of the labor intensity of the product, the sales
volume, and an assumption that wages in real terms remain constant.
In the GRIM, DOE used the labor content of each product and the
manufacturing production costs from the engineering analysis to
estimate the annual labor expenditures in the automatic commercial ice
maker industry. DOE used information gained through interviews with
manufacturers to estimate the portion of the total labor expenditures
that is attributable to domestic labor.
The production worker estimates in this section cover workers only
up to the line-supervisor level who are directly involved in
fabricating and assembling automatic commercial ice makers within an
original equipment manufacturer (OEM) facility. Workers performing
services that are closely associated with production operations, such
as material handling with a forklift, are also included as production
labor.
The employment impacts shown in Table V.34 represent the potential
production employment that could result following new and amended
energy conservation standards. The upper end of the results in this
table estimates the total potential increase in the number of
production workers after amended energy conservation standards. To
calculate the total potential increase, DOE assumed that manufacturers
continue to produce the
[[Page 14925]]
same scope of covered products in domestic production facilities and
domestic production is not shifted to lower-labor-cost countries.
Because there is a risk of manufacturers evaluating sourcing decisions
in response to amended energy conservation standards, the lower end of
the range of employment results in Table V.34 includes the estimated
total number of U.S. production workers in the industry who could lose
their jobs if all existing production were moved outside of the United
States. While the results present a range of employment impacts
following the compliance date of amended energy conservation standards,
the discussion below also includes a qualitative discussion of the
likelihood of negative employment impacts at the various TSLs. Finally,
the employment impacts shown are independent of the employment impacts
from the broader U.S. economy, which are documented in chapter 13 of
the NOPR TSD.
DOE estimates that in the absence of amended energy conservation
standards, there would be 268 domestic production workers involved in
manufacturing automatic commercial ice makers in 2018. Using 2011
Census Bureau data and interviews with manufacturers, DOE estimates
that approximately 84 percent of automatic commercial ice makers sold
in the United States are manufactured domestically. Table V.34 shows
the range of the impacts of potential amended energy conservation
standards on U.S. production workers in the automatic commercial ice
maker industry.
Table V.34--Potential Changes in the Total Number of Domestic Automatic Commercial Ice Maker Production Workers
in 2018
----------------------------------------------------------------------------------------------------------------
Base case 1 2 3 4 5
----------------------------------------------------------------------------------------------------------------
Total Number of Domestic 268 268 268 269 269 269
Production Workers in 2018
(without changes in production
locations).......................
Potential Changes in Domestic ........... 0-(268) 0-(268) 1-(268) 1-(268) 1-(268)
Production Workers in 2018 *.....
----------------------------------------------------------------------------------------------------------------
* DOE presents a range of potential employment impacts. Values in parentheses are negative numbers.
All examined TSLs show relatively minor impacts on domestic
employment levels relative to total industry employment. At all TSLs,
most of the design options analyzed by DOE do not greatly alter the
labor content of the final product. For example, the use of higher
efficiency compressors or fan motors involve one-time changes to the
final product, but do not significantly change the number of steps
required for the final assembly. One manufacturer suggested that their
domestic production employment levels would only change if market
demand contracted following higher overall prices. However, more than
one manufacturer suggested that where they already have overseas
manufacturing capabilities, they would consider moving additional
manufacturing to those facilities if they felt the need to offset a
significant rise in materials costs. Provided the changes in materials
costs do not support the relocation of manufacturing facilities, one
would expect only modest changes to domestic manufacturing employment
balancing additional requirements for assembly labor with the effects
of price elasticity.
c. Impacts on Manufacturing Capacity
According to the majority of automatic commercial ice maker
manufacturers interviewed, amended energy conservation standards that
require modest changes to product efficiency will not significantly
affect manufacturers' production capacities. Any redesign of automatic
commercial ice makers would not change the fundamental assembly of the
equipment, but manufacturers do anticipate some potential for
additional lead time immediately following standards associated with
changes in sourcing of higher efficiency components, which may be
supply constrained.
One manufacturer cited the possibility of a 3- to 6-month shutdown
in the event that amended standards were set high enough to require
retooling of their entire product line. Most of the design options
being evaluated are already available on the market as product options.
Thus, DOE believes that short of widespread retooling, manufacturers
would be able to maintain manufacturing capacity levels and continue to
meet market demand under amended energy conservation standards.
d. Impacts on Subgroups of Manufacturers
Small business, low volume, and niche equipment manufacturers, and
manufacturers exhibiting a cost structure substantially different from
the industry average could be affected disproportionately. As discussed
in section IV.J, using average cost assumptions to develop an industry
cash flow estimate is inadequate to assess differential impacts among
manufacturer subgroups.
For automatic commercial ice makers, DOE identified and evaluated
the impact of amended energy conservation standards on one subgroup:
small manufacturers. The SBA defines a ``small business'' as having 750
employees or less for NAICS 333415, ``Air-Conditioning and Warm Air
Heating Equipment and Commercial and Industrial Refrigeration Equipment
Manufacturing,'' which includes ice-making machinery manufacturing.
Based on this definition, DOE identified seven manufacturers in the
automatic commercial ice makers industry that are small businesses.
For a discussion of the impacts on the small manufacturer subgroup,
see the regulatory flexibility analysis in section VI.B of this notice
and chapter 12 of the NOPR TSD.
e. Cumulative Regulatory Burden
While any one regulation may not impose a significant burden on
manufacturers, the combined effects of recent or impending regulations
may have serious consequences for some manufacturers, groups of
manufacturers, or an entire industry. Assessing the impact of a single
regulation may overlook this cumulative regulatory burden. In addition
to energy conservation standards, other regulations can significantly
affect manufacturers' financial operations. Multiple regulations
affecting the same manufacturer can strain profits and lead companies
to abandon product lines or markets with lower expected future returns
than competing products. For these reasons, DOE conducts an analysis of
cumulative regulatory burden as part of its rulemakings pertaining to
equipment efficiency.
[[Page 14926]]
During previous stages of this rulemaking, DOE identified a number
of requirements in addition to amended energy conservation standards
for automatic commercial ice makers. The following section briefly
addresses comments DOE received with respect to cumulative regulatory
burden and summarizes other key related concerns that manufacturers
raised during interviews.
Existing Federal Standards for Automatic Commercial Ice Makers
Several manufacturers commented that they had made substantial
investments in order to comply with the previous Federal energy
conservation standards for batch style automatic commercial ice makers,
which took effect in January 2010. While DOE acknowledges the
significant investment on the part of industry, because the proposed
compliance date for new and amended standards is 2018, there should be
no direct overlap of compliance costs from either standard. The
residual financial impact of the previous energy conservation standards
manifest themselves in the 2018 standards MIA as the prevailing
industry conditions absent new or amended energy conservation
standards. This serves as the basis for the base-case INPV.
Certification, Compliance, and Enforcement (CC&E) Rule
Multiple manufacturers expressed concerns about the burden CC&E
would impose on the automatic commercial ice maker industry. CC&E
requires testing and compliance for a wide array of equipment
offerings. One manufacturer cited the increase in testing burden
associated with the DOE's new definition of ``basic'' model, which has
contributed significantly to the number of models considered to be
basic. Manufacturers worry that testing each variation would present a
significant testing burden, especially for small business
manufacturers.
In addition to costs associated with DOE CC&E requirements,
manufacturers cited an array of other certifications as being an
additional and substantial burden. Such certifications include codes
and standards developed by American Society of Mechanical Engineers
(ASME), which include standards for compressors, fasteners, flow
measurement, nuclear, environmental control, piping, pressure vessels,
pumps, storage tanks, and more.\67\ Other critical certification
programs for manufacturers of automatic commercial ice makers include
those of National Sanitation Foundation (NSF), Underwriters
Laboratories (UL), NRCan, and CEC. A new energy efficiency standard put
forth by the DOE that requires a complete product redesign will
necessitate recertification from the above-mentioned programs.
Manufacturers are concerned about the cumulative testing burden
associated with such re-certifications.
---------------------------------------------------------------------------
\67\ Information about ASME codes and standards can be obtained
at: www.asme.org/kb/standards/standards.
---------------------------------------------------------------------------
DOE understands that testing and certification requirements may
have a significant impact on manufacturers, and the CC&E burden is
identified as a key issue in the MIA. DOE also understands that CC&E
requirements can be particularly onerous for manufacturers producing
low volume or highly customized equipment. Regarding other
certification programs, the DOE again acknowledges the potential burden
associated with recertification. However, DOE also recognizes that
these programs are voluntary.
EPA and ENERGY STAR
Some manufacturers expressed concerns regarding potential conflicts
with the ENERGY STAR certification program. Manitowoc publicly
commented that certification by the ENERGY STAR program is very
important to their customers for a variety of reasons including the
potential for utility rebates and LEED certification. Manitowoc went on
to say that if DOE's energy efficiency standard level is raised to the
max-tech level, there would be no room for the ENERGY STAR
classification and that this could be highly disruptive to the industry
(Manitowoc, No. 42 at pp. 15-16). Due to the clear market value of the
ENERGY STAR program, manufacturers expressed concern about the
additional testing burdens associated with having to re-certify
products, or alternatively, having to forfeit market share by offering
products that are not ENERGY STAR certified.
DOE realizes that the cumulative effect of several regulations on
an industry may significantly increase the burden faced by
manufacturers that need to comply with multiple regulations and
certification programs from different organizations and levels of
government. However, DOE notes that certain standards, such as ENERGY
STAR, are optional for manufacturers.
Other Federal Regulations
Manufacturers also expressed concerns regarding the additional
burden caused by other Federal regulations, including the upcoming
amended energy conservation standards for residential refrigerators and
freezers, commercial refrigeration equipment, walk-in coolers and
freezers, miscellaneous residential refrigeration products, and cooking
products.
DOE recognizes the additional burden faced by manufacturers that
produce both automatic commercial ice makers in combination with one or
many of the above-mentioned products. Companies that produce a wide
range of regulated equipment may be faced with more capital and
equipment design development expenditures than competitors with a
narrower scope of production. DOE does attempt to quantify the
cumulative burden of Federal energy conservation standards on
manufacturers in its manufacturer impact analysis (see chapter 12 of
TSD). However, DOE cannot consider the quantitative impacts of amended
standards that have not yet been finalized, such as those for walk-in
coolers and walk-in freezers.
State Regulations
Relating to the CEC codes and standards, one manufacturer noted
California's 2020 energy policy goals, including the reduction of
greenhouse gas emissions to 1990 levels, as a source of additional
burden for automatic commercial ice maker manufacturers. Manufacturers
also added that the lead limit guidelines (see, for example, section 4-
101.13(C) of the Food Code 2013) \68\ put forth by the U.S. Food and
Drug Administration (FDA), and adopted as code by all 50 states,\69\
carry associated compliance costs. The levels specified by these
guidelines have remained unchanged for at least 15 years.
---------------------------------------------------------------------------
\68\ https://www.fda.gov/Food/GuidanceRegulation/RetailFoodProtection/FoodCode/ucm374275.htm).
\69\ https://www.fda.gov/downloads/Food/GuidanceRegulation/RetailFoodProtection/FederalStateCooperativePrograms/UCM230336.pdf.
---------------------------------------------------------------------------
International Regulations
Finally, one manufacturer noted additional burden associated with
the European Union (EU) Restriction on Hazardous Substances Directive
(RoHS), which restricts the use of six hazardous materials, including
lead, mercury, and cadmium, in the manufacture of various types of
electronic and electrical equipment.\70\
---------------------------------------------------------------------------
\70\ Information on EU RoHS can be found at: www.bis.gov.uk/nmo/
enforcement/rohs-home.
---------------------------------------------------------------------------
[[Page 14927]]
DOE discusses these and other requirements, and includes the full
details of the cumulative regulatory burden analysis, in chapter 12 of
the NOPR TSD.
3. National Impact Analysis
a. Amount and Significance of Energy Savings
DOE estimated the NES by calculating the difference in annual
energy consumption for the base-case scenario and standards-case
scenario at each TSL for each equipment class and summing up the annual
energy savings for the automatic commercial ice maker equipment
purchased during the 30-year 2018 to 2047 analysis period. Energy
impacts include the 30-year period, plus the life of equipment
purchased in the last year of the analysis, or roughly 2018 to 2057.
The energy consumption calculated in the NIA is full-fuel-cycle (FFC)
energy, which quantifies savings beginning at the source of energy
production. DOE also reports primary or source energy that takes into
account losses in the generation and transmission of electricity. FFC
and primary energy are discussed in section IV.H.
Table V.35 presents the source NES for all equipment classes at
each TSL and the sum total of NES for each TSL. Table V.36 presents the
energy savings at each TSL for each equipment class in the form of
percentage of the cumulative energy use of the equipment stock in the
base-case scenario.
Table V.35--Cumulative National Energy Savings at Source for Equipment Purchased in 2018-2047
----------------------------------------------------------------------------------------------------------------
Standard level *, **
Equipment class ----------------------------------------------------------------
TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B.................................. 0.002 0.004 0.010 0.010 0.013
IMH-W-Med-B.................................... 0.006 0.006 0.009 0.013 0.014
IMH-W-Large-B ***.............................. 0.001 0.001 0.001 0.002 0.003
IMH-W-Large-B1............................. 0.001 0.001 0.001 0.002 0.002
IMH-W-Large-B2............................. 0.000 0.000 0.000 0.001 0.001
IMH-A-Small-B.................................. 0.017 0.032 0.076 0.099 0.105
IMH-A-Large-B ***.............................. 0.024 0.045 0.095 0.122 0.122
IMH-A-Large-B1............................. 0.020 0.040 0.086 0.107 0.107
IMH-A-Large-B2............................. 0.005 0.005 0.009 0.015 0.015
RCU-Large-B ***................................ 0.013 0.013 0.030 0.046 0.047
RCU-Large-B1............................... 0.012 0.012 0.028 0.043 0.045
RCU-Large-B2............................... 0.001 0.001 0.002 0.003 0.003
SCU-W-Large-B.................................. 0.000 0.000 0.000 0.000 0.000
SCU-A-Small-B.................................. 0.002 0.013 0.024 0.037 0.037
SCU-A-Large-B.................................. 0.002 0.010 0.017 0.022 0.022
IMH-A-Small-C.................................. 0.002 0.003 0.005 0.008 0.012
IMH-A-Large-C.................................. 0.001 0.003 0.006 0.008 0.008
SCU-A-Small-C.................................. 0.001 0.004 0.007 0.007 0.011
----------------------------------------------------------------
Total...................................... 0.072 0.134 0.281 0.374 0.395
----------------------------------------------------------------------------------------------------------------
* A value equal to 0.000 means the NES rounds to less than 0.001 quads.
** Numbers may not add to totals due to rounding.
*** IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B results are the sum of the results for the 2 typical units
denoted by B1 and B2.
Table V.36--Cumulative Energy Savings by TSL as a Percentage of Cumulative Baseline Energy Usage of Automatic
Commercial Ice Maker Equipment Purchased in 2018-2047
----------------------------------------------------------------------------------------------------------------
Base case TSL savings as percent of baseline usage
Equipment class energy ----------------------------------------------------------------
usage TSL 1 (%) TSL 2 (%) TSL 3 (%) TSL 4 (%) TSL 5 (%)
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B..................... 0.062 4 7 16 16 21
IMH-W-Med-B....................... 0.089 6 6 10 15 16
IMH-W-Large-B *................... 0.026 6 6 6 9 10
IMH-W-Large-B1................ 0.017 7 7 7 10 11
IMH-W-Large-B2................ 0.009 3 3 3 7 8
IMH-A-Small-B..................... 0.463 4 7 16 21 23
IMH-A-Large-B *................... 0.635 4 7 15 19 19
IMH-A-Large-B1................ 0.490 4 8 17 22 22
IMH-A-Large-B2................ 0.145 3 3 6 11 11
RCU-Large-B *..................... 0.357 4 4 8 13 13
RCU-Large-B1.................. 0.333 4 4 8 13 13
RCU-Large-B2.................. 0.024 2 2 7 11 11
SCU-W-Large-B..................... 0.003 2 5 9 14 14
SCU-A-Small-B..................... 0.138 1 9 18 27 27
SCU-A-Large-B..................... 0.092 2 10 19 24 24
IMH-A-Small-C..................... 0.068 2 5 8 12 17
IMH-A-Large-C..................... 0.041 4 6 14 19 19
SCU-A-Small-C..................... 0.073 2 6 9 9 16
-----------------------------------------------------------------------------
Total......................... 2.047 4 7 14 18 19
----------------------------------------------------------------------------------------------------------------
* IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B results are the sum of the results for the 2 typical units
denoted by B1 and B2.
[[Page 14928]]
Table V.37 presents energy savings at each TSL for each equipment
class with the FFC adjustment. The NES increases from 0.073 quads at
TSL 1 to 0.401 quads at TSL 5.
Table V.37--Cumulative National Energy Savings including Full-Fuel-Cycle for Equipment Purchased in 2018-2047
----------------------------------------------------------------------------------------------------------------
Standard level ***
Equipment class ----------------------------------------------------------------
TSL 1 TSL 2 TSL 3 TSL 4 TS L5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B.................................. 0.002 0.004 0.010 0.010 0.013
IMH-W-Med-B.................................... 0.006 0.006 0.009 0.014 0.015
IMH-W-Large-B ***.............................. 0.001 0.001 0.001 0.002 0.003
IMH-W-Large-B1............................. 0.001 0.001 0.001 0.002 0.002
IMH-W-Large-B2............................. 0.000 0.000 0.000 0.001 0.001
IMH-A-Small-B.................................. 0.017 0.033 0.077 0.100 0.107
IMH-A-Large-B ***.............................. 0.025 0.045 0.096 0.124 0.124
IMH-A-Large-B1............................. 0.020 0.041 0.087 0.108 0.108
IMH-A-Large-B2............................. 0.005 0.005 0.009 0.016 0.016
RCU-Large-B ***................................ 0.013 0.013 0.030 0.046 0.048
RCU-Large-B1............................... 0.013 0.013 0.029 0.044 0.045
RCU-Large-B2............................... 0.001 0.001 0.002 0.003 0.003
SCU-W-Large-B.................................. 0.000 0.000 0.000 0.000 0.000
SCU-A-Small-B.................................. 0.002 0.013 0.025 0.038 0.038
SCU-A-Large-B.................................. 0.002 0.010 0.018 0.022 0.022
IMH-A-Small-C.................................. 0.002 0.003 0.006 0.008 0.012
IMH-A-Large-C.................................. 0.001 0.003 0.006 0.008 0.008
SCU-A-Small-C.................................. 0.001 0.004 0.007 0.007 0.012
----------------------------------------------------------------
Total...................................... 0.073 0.136 0.286 0.380 0.401
----------------------------------------------------------------------------------------------------------------
* A value equal to 0.000 means the NES rounds to less than 0.001 quads.
** Numbers may not add to totals due to rounding.
*** IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B results are the sum of the results for the 2 typical units
denoted by B1 and B2.
Circular A-4 requires agencies to present analytical results,
including separate schedules of the monetized benefits and costs that
show the type and timing of benefits and costs. Circular A-4 also
directs agencies to consider the variability of key elements underlying
the estimates of benefits and costs. For this rulemaking, DOE undertook
a sensitivity analysis using 9 rather than 30 years of product
shipments. The choice of a 9-year period is a proxy for the timeline in
EPCA for the review of certain energy conservation standards and
potential revision of and compliance with such revised standards.\71\
We would note that the review timeframe established in EPCA generally
does not overlap with the product lifetime, product manufacturing
cycles or other factors specific to automatic commercial ice makers.
Thus, this information is presented for informational purposes only and
is not indicative of any change in DOE's analytical methodology. The
NES results based on a 9-year analysis period are presented in Table
V.38. The impacts are counted over the lifetime of equipment purchased
in 2018-2026
---------------------------------------------------------------------------
\71\ For automatic commercial ice makers, DOE is required to
review standards at least every five years after the effective date
of any amended standards. (42 U.S.C. 6313(d)(3)(B)) If new standards
are promulgated, EPCA requires DOE to provide manufacturers a
minimum of 3 and a maximum of 5 years to comply with the standards.
(42 U.S.C. 6313(d)(3)(C)) In addition, for certain other types of
commercial equipment that are not specified in 42 U.S.C. 6311(1)(B)-
(G), EPCA requires DOE to review its standards at least once every 6
years (42 U.S.C. 6295(m)(1) and 6316(a)), and either a 3-year or a
5-year period after any new standard is promulgated before
compliance is required. (42 U.S.C. 6295(m)(4) and 6316(a)) As a
result, DOE's standards for automatic commercial ice makers can be
expected to be in effect for 8 to 10 years between compliance dates,
and its standards governing certain other commercial equipment, the
period is 9 to 11 years. A 9-year analysis was selected as
representative of the time between standard revisions.
Table V.38--National Full-Fuel-Cycle Energy Savings for 9-Year Analysis Period for Equipment Purchased in 2018-
2026
----------------------------------------------------------------------------------------------------------------
Standard level ***
Equipment class ----------------------------------------------------------------
TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B.................................. 0.001 0.001 0.003 0.003 0.004
IMH-W-Med-B.................................... 0.002 0.002 0.003 0.004 0.004
IMH-W-Large-B ***.............................. 0.000 0.000 0.000 0.001 0.001
IMH-W-Large-B1............................. 0.000 0.000 0.000 0.000 0.001
IMH-W-Large-B2............................. 0.000 0.000 0.000 0.000 0.000
IMH-A-Small-B.................................. 0.005 0.009 0.021 0.028 0.029
IMH-A-Large-B ***.............................. 0.007 0.012 0.026 0.034 0.034
IMH-A-Large-B1............................. 0.005 0.011 0.024 0.030 0.030
IMH-A-Large-B2............................. 0.001 0.001 0.003 0.004 0.004
RCU-Large-B ***................................ 0.004 0.004 0.008 0.013 0.013
RCU-Large-B1............................... 0.003 0.003 0.008 0.012 0.012
[[Page 14929]]
RCU-Large-B2............................... 0.000 0.000 0.000 0.001 0.001
SCU-W-Large-B.................................. 0.000 0.000 0.000 0.000 0.000
SCU-A-Small-B.................................. 0.000 0.004 0.007 0.010 0.010
SCU-A-Large-B.................................. 0.001 0.003 0.005 0.006 0.006
IMH-A-Small-C.................................. 0.000 0.001 0.002 0.002 0.003
IMH-A-Large-C.................................. 0.000 0.001 0.002 0.002 0.002
SCU-A-Small-C.................................. 0.000 0.001 0.002 0.002 0.003
----------------------------------------------------------------
Total...................................... 0.020 0.037 0.079 0.104 0.110
----------------------------------------------------------------------------------------------------------------
* A value equal to 0.000 means the NES rounds to less than 0.001 quads.
** Numbers may not add to totals due to rounding.
*** IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B results are the sum of the results for the 2 typical units
denoted by B1 and B2.
b. Net Present Value of Customer Costs and Benefits
DOE estimated the cumulative NPV to the Nation of the total savings
for the customers that would result from potential standards at each
TSL. In accordance with OMB guidelines on regulatory analysis (OMB
Circular A-4, section E, September 17, 2003), DOE calculated NPV using
both a 7-percent and a 3-percent real discount rate. The 7-percent rate
is an estimate of the average before-tax rate of return on private
capital in the U.S. economy, and reflects the returns on real estate
and small business capital, including corporate capital. DOE used this
discount rate to approximate the opportunity cost of capital in the
private sector, because recent OMB analysis has found the average rate
of return on capital to be near this rate. In addition, DOE used the 3-
percent rate to capture the potential effects of amended standards on
private consumption. This rate represents the rate at which society
discounts future consumption flows to their present value. It can be
approximated by the real rate of return on long-term government debt
(i.e., yield on Treasury notes minus annual rate of change in the CPI),
which has averaged about 3 percent on a pre-tax basis for the last 30
years.
Table V.39 and Table V.40 show the customer NPV results for each of
the TSLs DOE considered for automatic commercial ice makers at both 7-
percent and 3-percent discount rates. In each case, the impacts cover
the expected lifetime of equipment purchased from 2018-2047. Detailed
NPV results are presented in chapter 10 of the NOPR TSD.
The NPV results at a 7-percent discount rate for TSL 5 were
negative for three equipment classes and significantly lower than the
TSL 3 results for several other classes. This is consistent with the
results of LCC analysis results for TSL 5, which showed significant
increase in LCC and significantly higher PBPs that were in some cases
greater than the average equipment lifetimes. Efficiency levels for TSL
4 were chosen to correspond to the highest efficiency level with a
positive NPV for all classes at a 7-percent discount rate. Similarly,
the criteria for choice of efficiency levels for TSL 3, TSL 2, and TSL
1 were such that the NPV values for all the equipment classes show
positive values. The criterion for TSL 3 was to select efficiency
levels with the highest NPV at a 7-percent discount rate. Consequently,
the total NPV for automatic commercial ice makers was highest for TSL
3, with a value of $0.791 billion (2012$) at a 7-percent discount rate.
TSL 4 showed the second highest total NPV, with a value of $0.484
billion (2012$) at a 7-percent discount rate. TSL 1, TSL 2 and TSL 5
have a total NPV lower than TSL 3 or 4.
Table V.39--Net Present Value at a 7-Percent Discount Rate for Equipment Purchased in 2018-2047
[2012$]
----------------------------------------------------------------------------------------------------------------
Standard level *
Equipment class ----------------------------------------------------------------
TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B.................................. 0.006 0.011 0.025 0.025 (0.002)
IMH-W-Med-B.................................... 0.016 0.016 0.025 0.017 0.019
IMH-W-Large-B **............................... 0.004 0.004 0.004 0.003 0.003
IMH-W-Large-B1............................. 0.003 0.003 0.003 0.002 0.002
IMH-W-Large-B2............................. 0.001 0.001 0.001 0.001 0.001
IMH-A-Small-B.................................. 0.043 0.080 0.177 0.046 0.058
IMH-A-Large-B **............................... 0.070 0.127 0.297 0.256 0.256
IMH-A-Large-B1............................. 0.057 0.113 0.274 0.236 0.236
IMH-A-Large-B2............................. 0.014 0.014 0.023 0.020 0.020
RCU-Large-B **................................. 0.038 0.038 0.082 0.073 0.075
RCU-Large-B1............................... 0.036 0.036 0.078 0.070 0.072
RCU-Large-B2............................... 0.002 0.002 0.004 0.004 0.004
SCU-W-Large-B.................................. 0.001 0.001 0.001 0.000 0.000
SCU-A-Small-B.................................. 0.004 0.029 0.085 0.012 0.012
SCU-A-Large-B.................................. 0.004 0.039 0.052 0.021 0.021
IMH-A-Small-C.................................. 0.004 0.009 0.014 0.011 (0.018)
IMH-A-Large-C.................................. 0.004 0.007 0.016 0.007 0.007
[[Page 14930]]
SCU-A-Small-C.................................. 0.004 0.009 0.013 0.013 (0.062)
----------------------------------------------------------------
Total...................................... 0.198 0.368 0.791 0.484 0.370
----------------------------------------------------------------------------------------------------------------
* A value equal to 0.000 means the NPV rounds to less than $0.001 (2012$). Values in parentheses are negative
numbers.
** IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B results are the sum of the results for the 2 typical units
denoted by B1 and B2.
Table V.40--Net Present Value at a 3-Percent Discount Rate for Equipment Purchased in 2018-2047
[2012$]
----------------------------------------------------------------------------------------------------------------
Standard level *
Equipment class ----------------------------------------------------------------
TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B.................................. 0.013 0.023 0.057 0.057 0.010
IMH-W-Med-B.................................... 0.034 0.034 0.054 0.042 0.047
IMH-W-Large-B**................................ 0.009 0.009 0.009 0.007 0.008
IMH-W-Large-B1............................. 0.007 0.007 0.007 0.006 0.006
IMH-W-Large-B2............................. 0.002 0.002 0.002 0.001 0.002
IMH-A-Small-B.................................. 0.094 0.176 0.394 0.163 0.190
IMH-A-Large-B**................................ 0.152 0.275 0.653 0.596 0.596
IMH-A-Large-B1............................. 0.123 0.245 0.602 0.546 0.546
IMH-A-Large-B2............................. 0.030 0.030 0.051 0.050 0.050
RCU-Large-B **................................. 0.081 0.081 0.178 0.174 0.179
RCU-Large-B1............................... 0.078 0.078 0.169 0.165 0.170
RCU-Large-B2............................... 0.004 0.004 0.009 0.009 0.009
SCU-W-Large-B.................................. 0.001 0.002 0.002 0.001 0.001
SCU-A-Small-B.................................. 0.009 0.064 0.190 0.062 0.062
SCU-A-Large-B.................................. 0.010 0.086 0.118 0.062 0.062
IMH-A-Small-C.................................. 0.009 0.019 0.031 0.027 (0.028)
IMH-A-Large-C.................................. 0.009 0.016 0.034 0.018 0.018
SCU-A-Small-C.................................. 0.008 0.021 0.030 0.030 (0.114)
----------------------------------------------------------------
Total...................................... 0.430 0.806 1.751 1.238 1.032
----------------------------------------------------------------------------------------------------------------
* A value equal to 0.000 means the NPV rounds to less than $0.001 (2012$). Values in parentheses are negative
numbers.
** IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B results are the sum of the results for the 2 typical units
denoted by B1 and B2.
The NPV results based on the aforementioned 9-year analysis period
are presented in Table V.41 and Table V.42. The impacts are counted
over the lifetime of equipment purchased in 2018-2026. As mentioned
previously, this information is presented for informational purposes
only and is not indicative of any change in DOE's analytical
methodology or decision criteria.
Table V.41--Net Present Value at a 7-Percent Discount Rate for 9-Year Analysis Period for Equipment Purchased in
2018-2026
----------------------------------------------------------------------------------------------------------------
Standard level *
Equipment class ----------------------------------------------------------------
TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B.................................. 0.003 0.005 0.012 0.012 (0.001)
IMH-W-Med-B.................................... 0.008 0.008 0.012 0.008 0.009
IMH-W-Large-B.................................. 0.002 0.002 0.002 0.001 0.002
IMH-W-Large-B-1............................ 0.002 0.002 0.002 0.001 0.001
IMH-W-Large-B-2............................ 0.000 0.000 0.000 0.000 0.000
IMH-A-Small-B.................................. 0.021 0.039 0.086 0.023 0.029
IMH-A-Large-B.................................. 0.034 0.062 0.143 0.123 0.123
IMH-A-Large-B-1............................ 0.028 0.055 0.132 0.113 0.113
IMH-A-Large-B-2............................ 0.007 0.007 0.011 0.010 0.010
RCU-Large-B.................................... 0.018 0.018 0.040 0.036 0.037
RCU-Large-B-1.............................. 0.017 0.017 0.038 0.034 0.035
RCU-Large-B-2.............................. 0.001 0.001 0.002 0.002 0.002
SCU-W-Large-B.................................. 0.000 0.000 0.001 0.000 0.000
SCU-A-Small-B.................................. 0.002 0.014 0.040 0.005 0.005
SCU-A-Large-B.................................. 0.002 0.018 0.025 0.010 0.010
IMH-A-Small-C.................................. 0.002 0.004 0.007 0.005 (0.009)
[[Page 14931]]
IMH-A-Large-C.................................. 0.002 0.004 0.008 0.003 0.003
SCU-A-Small-C.................................. 0.002 0.005 0.006 0.006 (0.031)
----------------------------------------------------------------
Total...................................... 0.096 0.179 0.381 0.233 0.177
----------------------------------------------------------------------------------------------------------------
* A value equal to 0.000 means the NPV rounds to less than $0.001 (2012$). Values in parentheses are negative
numbers.
Table V.42--Net Present Value at a 3-Percent Discount Rate for 9-Year Analysis Period for Equipment Purchased in
2018-2026
----------------------------------------------------------------------------------------------------------------
Standard level*
Equipment class ----------------------------------------------------------------
TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B.................................. 0.005 0.008 0.020 0.020 0.003
IMH-W-Med-B.................................... 0.012 0.012 0.019 0.015 0.017
IMH-W-Large-B.................................. 0.003 0.003 0.003 0.003 0.003
IMH-W-Large-B-1................................ 0.002 0.002 0.002 0.002 0.002
IMH-W-Large-B-2................................ 0.001 0.001 0.001 0.001 0.001
IMH-A-Small-B.................................. 0.034 0.063 0.141 0.058 0.068
IMH-A-Large-B.................................. 0.054 0.098 0.230 0.209 0.209
IMH-A-Large-B-1................................ 0.044 0.088 0.211 0.191 0.191
IMH-A-Large-B-2................................ 0.011 0.011 0.018 0.018 0.018
RCU-Large-B.................................... 0.029 0.029 0.064 0.062 0.064
RCU-Large-B-1.................................. 0.028 0.028 0.060 0.059 0.061
RCU-Large-B-2.................................. 0.001 0.001 0.003 0.003 0.003
SCU-W-Large-B.................................. 0.000 0.001 0.001 0.000 0.000
SCU-A-Small-B.................................. 0.003 0.023 0.065 0.020 0.020
SCU-A-Large-B.................................. 0.003 0.030 0.041 0.021 0.021
IMH-A-Small-C.................................. 0.003 0.007 0.011 0.010 (0.010)
IMH-A-Large-C.................................. 0.003 0.006 0.012 0.006 0.006
SCU-A-Small-C.................................. 0.003 0.007 0.010 0.010 (0.042)
----------------------------------------------------------------
Total...................................... 0.153 0.287 0.617 0.434 0.359
----------------------------------------------------------------------------------------------------------------
*A value equal to 0.000 means the NPV rounds to less than $0.001 (2012$). Values in parentheses are negative
numbers.
c. Water Savings
In analyzing energy-saving design options for batch type ice
makers, one option had the additional impact of reducing potable water
usage for some types of batch type ice makers. The potable water
savings are identified on Table V.43.
Table V.43--Potable Water Savings
----------------------------------------------------------------------------------------------------------------
National water savings by standard level*\,\** million gallons
Equipment class ----------------------------------------------------------------
TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B.................................. 0 0 3,699 3,699 3,699
IMH-W-Med-B.................................... 0 0 0 0 0
IMH-W-Large-B.................................. 0 0 0 0 0
IMH-W-Large-B-1................................ 0 0 0 0 0
IMH-W-Large-B-2................................ 0 0 0 0 0
IMH-A-Small-B.................................. 0 0 0 0 0
IMH-A-Large-B.................................. 0 0 20,753 20,753 20,753
IMH-A-Large-B-1................................ 0 0 20,753 20,753 20,753
IMH-A-Large-B-2................................ 0 0 0 0 0
RCU-063-Large-B................................ 0 0 0 0 0
RCU-064-Large-B-1.............................. 0 0 0 0 0
RCU-065-Large-B-2.............................. 0 0 0 0 0
SCU-W-Large-B.................................. 141 141 141 141 141
SCU-A-Small-B.................................. 0 0 14,391 14,391 14,391
SCU-A-Large-B.................................. 0 6,424 6,424 6,424 6,424
IMH-A-Small-C.................................. 0 0 0 0 0
IMH-A-Large-C.................................. 0 0 0 0 0
SCU-A-Small-C.................................. 0 0 0 0 0
----------------------------------------------------------------
[[Page 14932]]
Total...................................... 141 6,565 45,407 45,407 45,407
----------------------------------------------------------------------------------------------------------------
d. Employment Impacts
In addition to the direct impacts on manufacturing employment
discussed in section V.B.2, DOE develops general estimates of the
indirect employment impacts of proposed standards on the economy. As
discussed above, DOE expects amended energy conservation standards for
automatic commercial ice makers to reduce energy bills for commercial
customers, and the resulting net savings to be redirected to other
forms of economic activity. DOE also realizes that these shifts in
spending and economic activity by automatic commercial ice maker owners
could affect the demand for labor. Thus, indirect employment impacts
may result from expenditures shifting between goods (the substitution
effect) and changes in income and overall expenditure levels (the
income effect) that occur due to the imposition of amended standards.
These impacts may affect a variety of businesses not directly involved
in the decision to make, operate, or pay the utility bills for
automatic commercial ice makers. To estimate these indirect economic
effects, DOE used an input/output model of the U.S. economy using U.S.
Department of Commerce, Bureau of Economic Analysis (BEA) and BLS data
(as described in section IV.N of this notice; see chapter 16 of the
NOPR TSD for more details).
In this input/output model, the dollars saved on utility bills from
more-efficient automatic commercial ice makers are concentrated in
economic sectors that create more jobs than are lost in electric and
water utilities sectors when spending is shifted from electricity and/
or water to other products and services. Thus, the proposed amended
energy conservation standards for automatic commercial ice makers are
likely to slightly increase the net demand for labor in the economy.
However, the net increase in jobs might be offset by other,
unanticipated effects on employment. Neither the BLS data nor the
input/output model used by DOE includes the quality of jobs. As shown
in Table V.44, DOE estimates that net indirect employment impacts from
a proposed automatic commercial ice makers amended standard are small
relative to the national economy.
Table V.44--Net Short-Term Change in Employment
------------------------------------------------------------------------
Trial standard level 2018 2022
------------------------------------------------------------------------
1............................... 19 to 20......... 100 to 101.
2............................... 36 to 40......... 192 to 196.
3............................... 75 to 87......... 431 to 442.
4............................... 44 to 91......... 506 to 552.
5............................... 34 to 90......... 518 to 572.
------------------------------------------------------------------------
4. Impact on Utility or Performance of Equipment
In performing the engineering analysis, DOE considers design
options that would not lessen the utility or performance of the
individual classes of equipment. (42 U.S.C. 6295(o)(2)(B)(i)(IV) and
6316(e)(1)) As presented in the screening analysis (chapter 4 of the
NOPR TSD), DOE eliminates from consideration any design options that
reduce the utility of the equipment. For this notice, DOE proposes that
none of the TSLs considered for automatic commercial ice makers reduce
the utility or performance of the equipment.
5. Impact of Any Lessening of Competition
EPCA directs DOE to consider any lessening of competition likely to
result from amended standards. It directs the Attorney General of the
United States (Attorney General) to determine in writing the impact, if
any, of any lessening of competition likely to result from a proposed
standard. (42 U.S.C. 6295(o)(2)(B)(i)(V) and 6313(d)(4)) To assist the
Attorney General in making such a determination, DOE provided the DOJ
with copies of this notice and the TSD for review. During MIA
interviews, domestic manufacturers indicated that foreign manufacturers
have begun to enter the automatic commercial ice maker industry, but
not in significant numbers. Manufacturers also stated that
consolidation has occurred among automatic commercial ice makers
manufacturers in recent years. Interviewed manufacturers believe that
these trends may continue in this market even in the absence of amended
standards.
DOE does not believe that amended standards would result in
domestic firms moving their production facilities outside the United
States. The majority of automatic commercial ice makers are
manufactured in the United States and, during interviews, manufacturers
in general indicated they would modify their existing facilities to
comply with amended energy conservation standards.
6. Need of the Nation To Conserve Energy
An improvement in the energy efficiency of the equipment subject to
today's NOPR is likely to improve the security of the Nation's energy
system by reducing overall demand for energy. Reduced electricity
demand may also improve the reliability of the electricity system. As a
measure of this reduced demand, chapter 15 in the NOPR TSD presents the
estimated reduction in national generating capacity for the TSLs that
DOE considered in this rulemaking.
Energy savings from amended standards for automatic commercial ice
makers could also produce environmental benefits in the form of reduced
emissions of air pollutants and GHGs associated with electricity
production. Table V.45 provides DOE's estimate of cumulative
CO2, NOX, Hg, N2O, CH4 and
SO2 emissions reductions projected to result from the TSLs
considered in this rule. The table includes both power sector emissions
and upstream emissions. The upstream emissions were calculated using
the multipliers discussed in section IV.K. DOE reports annual emissions
reductions for each TSL in chapter 13 of the NOPR TSD.
[[Page 14933]]
Table V.45--Summary of Emissions Reduction Estimated for Automatic Commercial Ice Makers TSLs
[Cumulative for equipment purchased in 2018-2047]
--------------------------------------------------------------------------------------------------------------------------------------------------------
TSL
------------------------------------------------------------------------------------
1 2 3 4 5
--------------------------------------------------------------------------------------------------------------------------------------------------------
Power Sector and Site Emissions
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO[ihel2] (million metric tons).................................... 3.50 6.52 13.68 18.19 19.19
NOX (thousand tons)................................................ -0.89 -1.66 -3.49 -4.64 -4.89
Hg (tons).......................................................... 0.01 0.01 0.02 0.03 0.03
N[ihel2]O (thousand tons).......................................... 0.08 0.15 0.31 0.41 0.43
CH[ihel4] (thousand tons).......................................... 0.47 0.88 1.84 2.45 2.58
SO[ihel2] (thousand tons).......................................... 5.31 9.89 20.76 27.60 29.12
--------------------------------------------------------------------------------------------------------------------------------------------------------
Upstream Emissions
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO[ihel2] (million metric tons).................................... 0.23 0.42 0.89 1.18 1.24
NOX (thousand tons)................................................ 3.11 5.80 12.18 16.19 17.08
Hg (tons).......................................................... 0.000 0.000 0.000 0.001 0.001
N[ihel2]O (thousand tons).......................................... 0.00 0.00 0.01 0.01 0.01
CH[ihel4] (thousand tons).......................................... 18.89 35.22 73.93 98.30 103.68
SO[ihel2] (thousand tons).......................................... 0.05 0.09 0.19 0.25 0.27
--------------------------------------------------------------------------------------------------------------------------------------------------------
Total Emissions
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO[ihel2] (million metric tons).................................... 3.72 6.94 14.57 19.37 20.43
NOX (thousand tons)................................................ 2.22 4.14 8.69 11.56 12.19
Hg (tons).......................................................... 0.01 0.01 0.02 0.03 0.03
N[ihel2]O (thousand tons).......................................... 0.08 0.15 0.32 0.42 0.45
CH[ihel4] (thousand tons).......................................... 19.36 36.09 75.77 100.75 106.27
SO[ihel2] (thousand tons).......................................... 5.35 9.98 20.95 27.86 29.38
--------------------------------------------------------------------------------------------------------------------------------------------------------
As part of the analysis for this NOPR, DOE estimated monetary
benefits likely to result from the reduced emissions of CO2
and NOX that DOE estimated for each of the TSLs considered.
As discussed in section IV.L, DOE used values for the SCC developed by
an interagency process. The interagency group selected four sets of SCC
values for use in regulatory analyses. Three sets are based on the
average SCC from three integrated assessment models, at discount rates
of 2.5 percent, 3 percent, and 5 percent. The fourth set, which
represents the 95th-percentile SCC estimate across all three models at
a 3-percent discount rate, is included to represent higher-than-
expected impacts from temperature change further out in the tails of
the SCC distribution. The four SCC values for CO2 emissions
reductions in 2015, expressed in 2012$, are $11.8/ton, $39.7/ton,
$61.2/ton, and $117.0/ton. These values for later years are higher due
to increasing emissions-related costs as the magnitude of projected
climate change is expected to increase.
Table V.46 presents the global value of CO2 emissions
reductions at each TSL. DOE calculated domestic values as a range from
7 percent to 23 percent of the global values, and these results are
presented in chapter 14 of the NOPR TSD.
Table V.46--Global Present Value of CO[ihel2] Emissions Reduction for Potential Standards for Automatic
Commercial Ice Makers
----------------------------------------------------------------------------------------------------------------
SCC Scenario *
---------------------------------------------------------------
TSL 3% discount
5% discount 3% discount 2.5% discount rate, 95th
rate, average rate, average rate, average percentile
----------------------------------------------------------------------------------------------------------------
million 2012$
----------------------------------------------------------------------------------------------------------------
Power Sector and Site Emissions
----------------------------------------------------------------------------------------------------------------
1............................................... 24.6 111.2 176.2 342.8
2............................................... 45.9 207.3 328.5 639.0
3............................................... 96.3 435.2 689.5 1,341.5
4............................................... 128.0 578.6 916.8 1,783.6
5............................................... 135.1 610.3 967.0 1,881.4
----------------------------------------------------------------------------------------------------------------
Upstream Emissions
----------------------------------------------------------------------------------------------------------------
1............................................... 1.5 7.0 11.2 21.7
2............................................... 2.8 13.1 20.8 40.4
3............................................... 6.0 27.5 43.7 84.9
4............................................... 7.9 36.5 58.1 112.8
[[Page 14934]]
5............................................... 8.4 38.5 61.3 119.0
----------------------------------------------------------------------------------------------------------------
Total Emissions
----------------------------------------------------------------------------------------------------------------
1............................................... 26.1 118.2 187.4 364.5
2............................................... 48.7 220.4 349.3 679.5
3............................................... 102.3 462.6 733.2 1,426.3
4............................................... 136.0 615.1 974.9 1,896.4
5............................................... 143.4 648.8 1,028.3 2,000.4
----------------------------------------------------------------------------------------------------------------
* For each of the four cases, the corresponding SCC value for emissions in 2015 is $11.8, $39.7, $61.2 and
$117.0 per metric ton (2012$).
DOE is well aware that scientific and economic knowledge about the
contribution of CO2 and other GHG emissions to changes in
the future global climate and the potential resulting damages to the
world economy continues to develop rapidly. Thus, any value placed in
this NOPR on reducing CO2 emissions is subject to change.
DOE, together with other Federal agencies, will continue to review
various methodologies for estimating the monetary value of reductions
in CO2 and other GHG emissions. This ongoing review will
consider the comments on this subject that are part of the public
record for this NOPR and other rulemakings, as well as other
methodological assumptions and issues. However, consistent with DOE's
legal obligations, and taking into account the uncertainty involved
with this particular issue, DOE has included in this NOPR the most
recent values and analyses resulting from the ongoing interagency
review process.
DOE also estimated a range for the cumulative monetary value of the
economic benefits associated with NOX emission reductions
anticipated to result from amended automatic commercial ice makers
standards. Table V.47 presents the present value of cumulative
NOX emissions reductions for each TSL calculated using the
average dollar-per-ton values and 7-percent and 3-percent discount
rates.
Table V.47--Present Value of NOX Emissions Reduction for Potential
Standards for Automatic Commercial Ice Makers
------------------------------------------------------------------------
3% 7%
TSL Discount Discount
rate rate
------------------------------------------------------------------------
million 2012$
------------------------------------------------------------------------
Power Sector and Site Emissions *
------------------------------------------------------------------------
1................................................. -1.8 -1.3
2................................................. -3.4 -2.4
3................................................. -7.2 -5.0
4................................................. -9.5 -6.6
5................................................. -10.1 -7.0
------------------------------------------------------------------------
Upstream Emissions
------------------------------------------------------------------------
1................................................. 4.3 2.1
2................................................. 8.0 3.8
3................................................. 16.8 8.0
4................................................. 22.3 10.7
5................................................. 23.6 11.3
------------------------------------------------------------------------
Total Emissions
------------------------------------------------------------------------
1................................................. 2.5 0.8
2................................................. 4.6 1.4
3................................................. 9.6 3.0
4................................................. 12.8 4.0
5................................................. 13.5 4.3
------------------------------------------------------------------------
The NPV of the monetized benefits associated with emission
reductions can be viewed as a complement to the NPV of the customer
savings calculated for each TSL considered in this NOPR. Table V.48
presents the NPV values that result from adding the estimates of the
potential economic benefits resulting from reduced CO2 and
NOX emissions in each of four valuation scenarios to the NPV
of consumer savings calculated for each TSL considered in this
rulemaking, at both a 7-percent and a 3-percent discount rate. The
CO2 values used in the table correspond to the four
scenarios for the valuation of CO2 emission reductions
presented in section IV.L.
Table V.48--Automatic Commercial Ice Makers TSLs: Net Present Value of Customer Savings Combined With Net
Present Value of Monetized Benefits From CO[ihel2] and NOX Emissions Reductions
----------------------------------------------------------------------------------------------------------------
Consumer NPV at 3% discount rate added with:
---------------------------------------------------------------
SCC Value of SCC Value of SCC Value of SCC Value of
$11.8/metric $39.7/metric $61.2/metric $117.0/metric
TSL ton CO[ihel2]* ton CO[ihel2]* ton CO[ihel2]* ton CO[ihel2]*
and Medium and Medium and Medium and Medium
Value for Value for Value for Value for
NOX** NOX** NOX** NOX**
----------------------------------------------------------------------------------------------------------------
billion 2012$
----------------------------------------------------------------------------------------------------------------
1............................................... 0.458 0.550 0.620 0.797
2............................................... 0.859 1.031 1.160 1.490
3............................................... 1.863 2.223 2.494 3.187
4............................................... 1.387 1.866 2.226 3.148
[[Page 14935]]
5............................................... 1.189 1.694 2.074 3.046
----------------------------------------------------------------------------------------------------------------
Consumer NPV at 7% discount rate added with:
---------------------------------------------------------------
SCC Value of SCC Value of SCC Value of SCC Value of
$11.8/metric $39.7/metric $61.2/metric $117.0/metric
TSL ton CO[ihel2]* ton CO[ihel2]* ton CO[ihel2]* ton CO[ihel2]*
and Medium and Medium and Medium and Medium
Value for Value for Value for Value for
NOX** NOX** NOX** NOX**
----------------------------------------------------------------------------------------------------------------
billion 2012$
----------------------------------------------------------------------------------------------------------------
1............................................... 0.224 0.317 0.386 0.563
2............................................... 0.418 0.590 0.719 1.049
3............................................... 0.896 1.257 1.527 2.220
4............................................... 0.624 1.103 1.463 2.385
5............................................... 0.518 1.023 1.403 2.375
----------------------------------------------------------------------------------------------------------------
* These label values represent the global SCC in 2015, in 2012$. The present values have been calculated with
scenario-consistent discount rates. For NOX emissions, each case uses the medium value, which corresponds to
$2,639 per ton.
Although adding the value of customer savings to the values of
emission reductions provides a valuable perspective, the following
should be considered: (1) the national customer savings are domestic
U.S. customer monetary savings found in market transactions, while the
values of emission reductions are based on estimates of marginal social
costs, which, in the case of CO2, are based on a global
value; and (2) the assessments of customer savings and emission-related
benefits are performed with different computer models, leading to
different time frames for analysis. For automatic commercial ice
makers, the present value of national customer savings is measured for
the period in which units shipped (2018-2047) continue to operate.
However, the time frames of the benefits associated with the emission
reductions differ. For example, the value of CO2 emission
reductions in a given year reflects the present value of all future
climate-related impacts due to emitting a ton of CO2 in that
year, out to the year 2100.
7. Other Factors
EPCA allows the Secretary, in determining whether a proposed
standard is economically justified, to consider any other factors that
the Secretary deems to be relevant. (42 U.S.C. 6295(o)(2)(B)(i)(VII)
and 6313(d)(4)) DOE considered LCC impacts on identifiable groups of
customers, such as customers of different business types, who may be
disproportionately affected by any amended national energy conservation
standard level. DOE also considered the reduction in generation
capacity that could result from the imposition of any amended national
energy conservation standard level.
DOE carried out a RIA, as described in the NOPR TSD chapter 17, to
study the impact of certain non-regulatory alternatives that may
encourage customers to purchase higher efficiency equipment and, thus,
achieve NES. The two major alternatives identified by DOE are customer
rebates and customer tax credits. DOE surveyed the various rebate
programs available in the United States. Typically, rebates are offered
for commercial sector businesses that purchase energy-efficient
automatic commercial ice makers, typically, machines that qualify
either for ENERGY STAR or CEE certification. Rebates offered range from
$40 to several hundred dollars, depending on the size and type of ice
maker. Based on the incremental costs DOE estimated for TSL 1
(equivalent to the ENERGY STAR targets that were in existence until
early in 2013), the rebates offered are sufficient to cover the
incremental costs of meeting the ENERGY STAR levels. Given the range of
rebates offered, DOE elected to model rebates of equivalent to 60
percent of the full incremental cost of the upgrades.
For the tax credits scenario, DOE did not find a suitable program
to model the scenario. From a consumer perspective, the most important
difference between rebate and tax credit programs is that a rebate can
be obtained relatively quickly, whereas receipt of tax credits is
delayed until income taxes are filed or a tax refund is provided by the
IRS. As with consumer rebates, DOE assumed that consumer tax credits
paid 60 percent of the incremental product price, but estimated a
different response rate. The delay in reimbursement makes tax credits
less attractive than rebates; consequently, DOE estimated a response
rate that is 80 percent of that for rebate programs.
Table V.49 and Table V.50 show the NES and NPV, respectively, for
the non-regulatory alternatives analyzed. For comparison, the table
includes the results of the NES and NPV for TSL 3, the proposed energy
conservation standard. Energy savings are expressed in quads in terms
of primary or source energy, which includes generation and transmission
losses from electricity utility sector.
[[Page 14936]]
Table V.49--Cumulative NES of Non-Regulatory Alternatives Compared to
the Proposed Standards for Automatic Commercial Ice Makers
------------------------------------------------------------------------
Cumulative Primary NES
Policy alternatives quads
------------------------------------------------------------------------
No new regulatory action................... 0
Customer tax credits....................... 0.145
Customer rebates........................... 0.190
Voluntary energy efficiency targets........ 0
Early replacement.......................... 0
Proposed standards, primary energy (TSL 3). 0.281
------------------------------------------------------------------------
Table V.50--Cumulative NPV of Non-Regulatory Alternatives Compared to
the Proposed Standards for Automatic Commercial Ice Makers
------------------------------------------------------------------------
Cumulative net present value billion
2012$
Policy alternatives ---------------------------------------
7% Discount 3% Discount
------------------------------------------------------------------------
No new regulatory action........ 0 0
Customer tax credits............ 0.520 1.011
Customer rebates................ 0.678 1.319
Voluntary energy efficiency 0 0
targets........................
Early replacement............... 0 0
Proposed standards (TSL 3)...... 0.791 1.751
------------------------------------------------------------------------
As shown above, none of the policy alternatives DOE examined would
achieve close to the amount of energy or monetary savings that could be
realized under the proposed amended standard. Also, implementing either
tax credits or customer rebates would incur initial and/or
administrative costs that were not considered in this analysis.
C. Proposed Standard
DOE recognizes that when it considers amendments to the standards,
it is subject to the EPCA requirement that any new or amended energy
conservation standard for any type (or class) of covered product be
designed to achieve the maximum improvement in energy efficiency that
the Secretary determines is technologically feasible and economically
justified. (42 U.S.C. 6295(o)(2)(A) and 6313(d)(4)) In determining
whether a proposed standard is economically justified, the Secretary
must determine whether the benefits of the standard exceed its burdens
to the greatest extent practicable, in light of the seven statutory
factors discussed previously. (42 U.S.C. 6295(o)(2)(B)(i) and
6313(d)(4)) The new or amended standard must also result in a
significant conservation of energy. (42 U.S.C. 6295(o)(3)(B) and
6316(d)(4))
DOE considered the impacts of standards at each TSL, beginning with
the maximum technologically feasible level, to determine whether that
level met the evaluation criteria. If the max-tech level was not
justified, DOE then considered the next most-efficient level and
undertook the same evaluation until it reached the highest efficiency
level that is both technologically feasible and economically justified
and saves a significant amount of energy.
DOE discusses the benefits and/or burdens of each TSL in the
following sections. DOE bases its discussion on quantitative analytical
results for each TSL including NES, NPV (discounted at 7 and 3
percent), emission reductions, INPV, LCC, and customers' installed
price increases. Beyond the quantitative results, DOE also considers
other burdens and benefits that affect economic justification,
including how technological feasibility, manufacturer costs, and
impacts on competition may affect the economic results presented. Table
V.51, Table V.52, Table V.53 and Table V.54 present a summary of the
results of DOE's quantitative analysis for each TSL. Results in Table
V.51 are impacts from equipment purchased in the period from 2018-2047.
In addition to the quantitative results presented in the tables, DOE
also considers other burdens and benefits that affect economic
justification of certain customer subgroups that are disproportionately
affected by the proposed standards. Section V.B.7 presents the
estimated impacts of each TSL for these subgroups.
Table V.51--Summary of Results for Automatic Commercial Ice Makers TSLs: National Impacts*
--------------------------------------------------------------------------------------------------------------------------------------------------------
Category TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
--------------------------------------------------------------------------------------------------------------------------------------------------------
Cumulative National Energy Savings 2018 through 2047 quads
--------------------------------------------------------------------------------------------------------------------------------------------------------
Undiscounted values................ 0.073................. 0.136................. 0.286................ 0.380................ 0.401
--------------------------------------------------------------------------------------------------------------------------------------------------------
Cumulative National Water Savings 2018 through 2047 billion gallons
--------------------------------------------------------------------------------------------------------------------------------------------------------
Undiscounted values................ 0.1................... 6.6................... 45.4................. 45.4................. 45.4
--------------------------------------------------------------------------------------------------------------------------------------------------------
Cumulative NPV of Customer Benefits 2018 through 2047 2012$ billion
--------------------------------------------------------------------------------------------------------------------------------------------------------
3% discount rate................... 0.430................. 0.806................. 1.751................ 1.238................ 1.032
[[Page 14937]]
7% discount rate................... 0.198................. 0.368................. 0.791................ 0.484................ 0.370
--------------------------------------------------------------------------------------------------------------------------------------------------------
Industry Impacts
--------------------------------------------------------------------------------------------------------------------------------------------------------
Change in Industry NPV (2012$ (8.4) to (8.7)........ (12.8) to (13.6)...... (20.9) to (23.9)..... (19.6) to (30.5)..... (19.9) to (32.6)
million).
Change in Industry NPV (%)......... (8.2) to (8.5)........ (12.6) to (13.4)...... (20.5) to (23.5)..... (19.2) to (30.0)..... (19.5) to (32.0)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Cumulative Emissions Reductions 2018 through 2047**
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO[ihel2] (MMt).................... 3.72.................. 6.94.................. 14.57................ 19.37................ 20.43
NOX (kt)........................... 2.22.................. 4.14.................. 8.69................. 11.56................ 12.19
Hg (t)............................. 0.01.................. 0.01.................. 0.02................. 0.03................. 0.03
N[ihel2]O (kt)..................... 0.08.................. 0.15.................. 0.32................. 0.42................. 0.45
N[ihel2]O (kt CO[ihel2]eq)......... 24.28................. 45.26................. 95.01................ 126.32............... 133.25
CH[ihel4] (kt)..................... 19.36................. 36.09................. 75.77................ 100.75............... 106.27
CH[ihel4] (kt CO[ihel2]eq)......... 484.06................ 902.37................ 1894.29.............. 2518.64.............. 2656.69
SO[ihel2] (kt)..................... 5.35.................. 9.98.................. 20.95................ 27.86................ 29.38
--------------------------------------------------------------------------------------------------------------------------------------------------------
Monetary Value of Cumulative Emissions Reductions 2018 through 2047[dagger]
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO[ihel2] (2012$ billion).......... 0.026 to 0.364........ 0.049 to 0.679........ 0.102 to 1.426....... 0.136 to 1.896....... 0.143 to 2.0
NOX--3% discount rate (2012$ 2.5................... 4.6................... 9.6.................. 12.8................. 13.5
million).
NOX--7% discount rate (2012$ 0.8................... 1.4................... 3.0.................. 4.0.................. 4.3
million).
--------------------------------------------------------------------------------------------------------------------------------------------------------
Employment Impacts
--------------------------------------------------------------------------------------------------------------------------------------------------------
Net Change in Indirect Domestic 100 to 101............ 192 to 196............ 431 to 442........... 506 to 552........... 518 to 572
Jobs by 2022.
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Values in parentheses are negative numbers.
** ``MMt'' stands for million metric tons; ``kt'' stands for kilotons; ``t'' stands for tons. CO[ihel2]eq is the quantity of CO[ihel2] that would have
the same global warming potential (GWP).
[dagger] Range of the economic value of CO[ihel2] reductions is based on estimates of the global benefit of reduced CO[ihel2] emissions. Economic value
of NOX reductions is based on estimates at $2,639/ton.
Table V.52--Summary of Results for Automatic Commercial Ice Makers TSLs: Mean LCC Savings
[2012$]
----------------------------------------------------------------------------------------------------------------
Standard level
Equipment class -------------------------------------------------------------------------------
TSL1 TSL2 TSL3 TSL4 TSL5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B................... $199 $215 $328 $328 $49
IMH-W-Med-B..................... 464 464 587 405 460
IMH-W-Large-B*.................. 833 833 833 550 582
IMH-W-Large-B1.............. 701 701 701 583 607
IMH-W-Large-B2.............. 1,260 1,260 1,260 442 500
IMH-A-Small-B................... 254 259 396 170 198
IMH-A-Large-B*.................. 648 633 1,127 994 994
IMH-A-Large-B1.............. 590 572 1,168 1,062 1,062
IMH-A-Large-B2.............. 960 960 908 627 627
RCU-Large-B*.................... 875 875 983 870 897
RCU-Large-B1................ 847 847 963 857 882
RCU-Large-B2................ 1,298 1,298 1,277 1,070 1,123
SCU-W-Large-B................... 483 687 694 143 149
SCU-A-Small-B................... 103 198 396 106 106
SCU-A-Large-B................... 140 522 502 240 240
IMH-A-Small-C................... 315 314 391 307 (237)
IMH-A-Large-C................... 660 744 1,026 524 500
SCU-A-Small-C................... 93 140 146 146 (441)
----------------------------------------------------------------------------------------------------------------
* LCC results for IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B are a weighted average of the two sub-equipment
class level typical units shown on the table, using weights provided in TSD chapter 7.
[[Page 14938]]
Table V.53--Summary of Results for Automatic Commercial Ice Makers TSLs: Median Payback Period
----------------------------------------------------------------------------------------------------------------
Standard Level years
Equipment class -------------------------------------------------------------------------------
TSL1 TSL2 TSL3 TSL4 TSL5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B................... 1.07 1.26 2.27 2.27 5.42
IMH-W-Med-B..................... 0.63 0.63 0.85 3.33 3.22
IMH-W-Large-B*.................. 0.69 0.69 0.69 3.59 3.60
IMH-W-Large-B1.............. 0.72 0.72 0.72 3.75 3.77
IMH-W-Large-B2.............. 0.58 0.58 0.58 3.10 3.02
IMH-A-Small-B................... 1.07 1.22 1.42 4.32 4.24
IMH-A-Large-B*.................. 0.46 0.49 0.84 2.16 2.16
IMH-A-Large-B1.............. 0.46 0.50 0.82 2.08 2.08
IMH-A-Large-B2.............. 0.42 0.42 0.94 2.58 2.58
RCU-Large-B*.................... 0.41 0.41 0.65 2.39 2.44
RCU-Large-B1................ 0.38 0.38 0.62 2.37 2.42
RCU-Large-B2................ 0.75 0.75 1.00 2.70 2.70
SCU-W-Large-B................... 0.67 0.76 1.00 3.01 3.00
SCU-A-Small-B................... 1.40 1.52 1.56 4.79 4.79
SCU-A-Large-B................... 1.37 1.17 1.49 3.72 3.72
IMH-A-Small-C................... 0.90 0.90 0.97 2.59 6.83
IMH-A-Large-C................... 0.52 0.53 0.69 3.25 3.24
SCU-A-Small-C................... 1.13 1.53 1.85 1.85 19.12
----------------------------------------------------------------------------------------------------------------
* PBP results for IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B are weighted averages of the results for the two
sub-equipment class level typical units, using weights provided in TSD chapter 7.
Table V.54--Summary of Results for Automatic Commercial Ice Maker TSLs: Distribution of Customer LCC Impacts
----------------------------------------------------------------------------------------------------------------
Standard Level percentage of customers (%)
Category -------------------------------------------------------------------------------
TSL1 TSL2 TSL3 TSL4 TSL5
----------------------------------------------------------------------------------------------------------------
IMH-W-Small-B
Net Cost (%)................ 0.0 0.0 3.5 3.5 45.3
No Impact (%)............... 60.8 34.8 0.0 0.0 0.0
Net Benefit (%)............. 39.2 65.2 96.5 96.5 54.7
IMH-W-Med-B
Net Cost (%)................ 0.0 0.0 0.0 14.9 11.3
No Impact (%)............... 31.0 31.0 14.3 2.4 2.4
Net Benefit (%)............. 69.0 69.0 85.7 82.7 86.3
IMH-W-Large-B*
Net Cost (%)................ 0.0 0.0 0.0 8.4 7.1
No Impact (%)............... 37.6 37.6 37.6 25.8 22.1
Net Benefit (%)............. 62.4 62.4 62.4 65.8 70.8
IMH-W-Large-B1
Net Cost (%)................ 0.0 0.0 0.0 0.1 0.2
No Impact (%)............... 28.6 28.6 28.6 28.6 23.8
Net Benefit (%)............. 71.4 71.4 71.4 71.3 76.0
IMH-W-Large-B2
Net Cost (%)................ 0.0 0.0 0.0 35.2 29.4
No Impact (%)............... 66.6 66.6 66.6 16.7 16.7
Net Benefit (%)............. 33.4 33.4 33.4 48.1 53.9
IMH-A-Small-B
Net Cost (%)................ 0.0 0.0 0.0 27.0 22.4
No Impact (%)............... 62.9 31.5 0.0 0.0 0.0
Net Benefit (%)............. 37.1 68.5 100.0 73.0 77.6
IMH-A-Large-B*
Net Cost (%)................ 0.0 0.0 0.0 3.6 3.6
No Impact (%)............... 59.8 22.8 6.3 2.1 2.1
Net Benefit (%)............. 40.2 77.2 93.7 94.4 94.4
IMH-A-Large-B1
Net Cost (%)................ 0.0 0.0 0.0 1.2 1.2
No Impact (%)............... 58.6 14.7 0.0 0.0 0.0
Net Benefit (%)............. 41.5 85.4 100.0 98.8 98.8
IMH-A-Large-B2
Net Cost (%)................ 0.0 0.0 0.0 16.5 16.5
No Impact (%)............... 66.6 66.6 40.0 13.4 13.4
Net Benefit (%)............. 33.4 33.4 60.0 70.2 70.2
RCU-Large-B*
Net Cost (%)................ 0.0 0.0 0.0 5.9 5.2
No Impact (%)............... 58.1 58.1 18.5 9.5 9.5
Net Benefit (%)............. 41.9 41.9 81.5 84.6 85.3
[[Page 14939]]
RCU-Large-B1
Net Cost (%)................ 0.0 0.0 0.0 5.8 5.1
No Impact (%)............... 57.2 57.2 17.9 9.0 9.0
Net Benefit (%)............. 42.8 42.8 82.1 85.3 85.9
RCU-Large-B2
Net Cost (%)................ 0.0 0.0 0.0 7.1 6.2
No Impact (%)............... 72.7 72.7 27.3 18.2 18.2
Net Benefit (%)............. 27.3 27.3 72.7 74.7 75.7
SCU-W-Large-B
Net Cost (%)................ 0.0 0.0 0.0 49.3 48.8
No Impact (%)............... 71.4 71.4 57.2 14.3 14.3
Net Benefit (%)............. 28.6 28.6 42.8 36.4 36.8
SCU-A-Small-B
Net Cost (%)................ 0.0 0.0 0.0 31.8 31.8
No Impact (%)............... 82.9 37.1 11.5 0.0 0.0
Net Benefit (%)............. 17.1 62.9 88.5 68.2 68.2
SCU-A-Large-B
Net Cost (%)................ 0.0 0.0 0.1 34.3 34.3
No Impact (%)............... 71.4 35.7 7.2 0.0 0.0
Net Benefit (%)............. 28.6 64.3 92.7 65.7 65.7
IMH-A-Small-C
Net Cost (%)................ 0.0 0.0 0.0 7.9 72.7
No Impact (%)............... 77.2 54.3 40.0 31.4 11.5
Net Benefit (%)............. 22.8 45.7 60.0 60.7 15.9
IMH-A-Large-C
Net Cost (%)................ 0.0 0.0 0.0 21.3 21.1
No Impact (%)............... 65.0 45.0 15.0 15.0 10.0
Net Benefit (%)............. 35.0 55.0 85.0 63.7 68.9
SCU-A-Small-C
Net Cost (%)................ 0.0 0.0 0.0 0.0 79.8
No Impact (%)............... 73.4 53.3 36.7 36.7 20.0
Net Benefit (%)............. 26.6 46.7 63.3 63.3 0.2
----------------------------------------------------------------------------------------------------------------
* LCC results for IMH-W-Large-B, IMH-A-Large-B, and RCU-Large-B are a weighted average of the two sub-equipment
class level typical units shown on the table.
DOE also notes that the economics literature provides a wide-
ranging discussion of how consumers trade-off upfront costs and energy
savings in the absence of government intervention. Much of this
literature attempts to explain why consumers appear to undervalue
energy efficiency improvements. This undervaluation suggests that
regulation that promotes energy efficiency can produce significant net
private gains (as well as producing social gains by, for example,
reducing pollution). There is evidence that consumers undervalue future
energy savings as a result of (1) a lack of information; (2) a lack of
sufficient salience of the long-term or aggregate benefits; (3) a lack
of sufficient savings to warrant delaying or altering purchases (e.g.,
an inefficient ventilation fan in a new building or the delayed
replacement of a water pump); (4) excessive focus on the short term, in
the form of inconsistent weighting of future energy cost savings
relative to available returns on other investments; (5) computational
or other difficulties associated with the evaluation of relevant
tradeoffs; and (6) a divergence in incentives (e.g., renter versus
building owner, builder versus home buyer). Other literature indicates
that with less than perfect foresight and a high degree of uncertainty
about the future, consumers may trade off these types of investments at
a higher-than-expected rate between current consumption and uncertain
future energy cost savings.
While DOE is not prepared at present to provide a fuller
quantifiable framework for estimating the benefits and costs of changes
in consumer purchase decisions due to an amended energy conservation
standard, DOE has posted a paper that discusses the issue of consumer
welfare impacts of appliance energy efficiency standards, and potential
enhancements to the methodology by which these impacts are defined and
estimated in the regulatory process.\72\ DOE is committed to developing
a framework that can support empirical quantitative tools for improved
assessment of the consumer welfare impacts of appliance standards. DOE
welcomes comments on information and methods to better assess the
potential impact of energy conservation standards on consumer choice
and methods to quantify this impact in its regulatory analysis in
future rulemakings.
---------------------------------------------------------------------------
\72\ Sanstad, A. Notes on the Economics of Household Energy
Consumption and Technology Choice. 2010. Lawrence Berkeley National
Laboratory, Berkeley, CA. www1.eere.energy.gov/buildings/appliance_standards/pdfs/consumer_ee_theory.pdf.
---------------------------------------------------------------------------
TSL 5 corresponds to the max-tech level for all the equipment
classes and offers the potential for the highest cumulative energy
savings through the analysis period from 2018 to 2047. The estimated
energy savings from TSL 5 is 0.401 quads of energy, and potable water
savings are 45.4 billion gallons. DOE projects a net positive NPV for
customers valued at $0.370 billion at a 7-percent discount rate.
Estimated emissions reductions are 20.4 MMt of CO2, up to
12.2 kt of NOX and 0.03 tons
[[Page 14940]]
of Hg. The CO2 emissions have a value of up to $2.0 billion
and the NOX emissions have a value of up to $7.8 million at
a 7-percent discount rate.
For TSL 5, with the exception of equipment class IMH-A-Small-C and
SCU-A-Small-C, the mean LCC savings for all equipment classes are
positive, implying a decrease in LCC, with the decrease ranging from
$49 for the IMH-W-Small-B equipment class to $945 for the IMH-A-Large-B
equipment class.\73\ Although the mean LCC decreases indicate a savings
potential for commercial ice makers as a whole, the results shown on
Table V.54 indicates a large fraction of customers would experience net
LCC increases (i.e., LCC costs rather than savings) from adoption of
TSL 5, with 30 to nearly 80 percent of customers experiencing net LCC
increases in six equipment classes. As shown on Table V.53, customers
in 10 equipment classes would experience payback periods of 3 years or
longer.
---------------------------------------------------------------------------
\73\ Two of the typical units modeled for the three large batch
classes have higher savings. For this section of the NOPR, the
discussion is limited to results for full equipment classes.
---------------------------------------------------------------------------
At TSL 5, manufacturers may experience a loss of INPV due to large
investments in product development and manufacturing capital as nearly
all products will need substantial redesign and existing production
lines will need to be adapted to produce evaporators and cabinets,
among other components, for the newly compliant designs. Where these
designs may differ considerably from those currently available, this
TSL also presents a significant testing burden. The projected change in
INPV ranges from a decrease of $32.6 million to a decrease of $19.9
million depending on the chosen manufacturer markup scenario. The upper
bound of a $19.9 million decrease in INPV is considered an optimistic
scenario for manufacturers because it assumes they can maintain the
same gross margin (as a percentage of revenue) on their sales. DOE
recognizes the risk of large negative impacts on industry if
manufacturers' expectations concerning reduced profit margins are
realized. TSL 5 could reduce the INPV for automatic commercial ice
makers by up to 32.0 percent if impacts reach the lower bound of the
range, which represents a scenario in which manufacturers cannot fully
mark up the increased equipment costs, and therefore cannot maintain
the same overall gross margins (as a percentage of revenue) they would
have in the base case.
In addition to the estimated impacts on INPV, the impacts on
manufacturing capacity and competition are of concern at TSL 5. While
more than half of the manufacturers who produce continuous products,
already offer at least one product that complies with TSL 5, only two
manufacturers currently produce batch commercial ice makers that comply
with the efficiency levels specified at TSL 5. This includes one small
business manufacturer whose niche products have among the very largest
harvest capacities in their respective equipment classes and are sold
in small quantities relative to the rest of the industry. In contrast
to this small business manufacturer, the other manufacturer is
Hoshizaki, which produces more mainstream batch products and commands
substantial market share.
The concentration of current production of batch commercial ice
makers at TSL 5 presents two issues. Hoshizaki holds intellectual
property covering the design of the evaporator used in their batch
equipment, which limits the range of possible alternative paths to
achieving the efficiency levels for batch equipment specified at TSL 5.
While the engineering analysis identified other means to achieve these
high efficiencies, given this limitation on design options, other
manufacturers expressed significant doubts regarding their ability to
do so. Further, DOE's analysis indicates that these efficiency levels
require the use of permanent magnet motors and, for batch equipment,
drain water heat exchangers. DOE was able to identify only one supplier
of the latter technology, whose design is patented. In addition, there
is currently very limited use of permanent magnet motors in commercial
ice makers; hence, motor suppliers would be required to develop and
initiate production for a broad range of new motor designs suitable for
automatic commercial ice makers. These needs could severely impact
automatic commercial ice maker manufacturers' ability to procure the
required components in sufficient quantities to supply the market.
Assuming the other paths to achieving these efficiency levels prove
fruitful, TSL 5 would still require that every other manufacturer
retool their entire batch equipment production lines. Further, DOE
review of the efficiency levels of available equipment shows that only
13 percent of Hoshizaki's batch products meet the TSL 5 efficiency
levels, suggesting that the vast majority of their production lines
would also require redesign and retooling. In confidential interviews,
one manufacturer cited the possibility of a 3-month to 6-month shutdown
in the event that amended standards were set high enough to require
retooling of their entire product line. Compounding this effect across
the industry could severely impact manufacturing capacity in the
interim period between the announcement of the standards and the
compliance date.
After carefully considering the analysis results and weighing the
benefits and burdens of TSL 5, DOE finds that at TSL 5, the benefits to
the Nation in the form of energy savings and emissions reductions plus
an increase of $0.370 billion in customer NPV are weighed against a
decrease of up to 32.0 percent in INPV. While most individual customers
purchasing automatic commercial ice makers built to TSL 5 standards
would be better off than in the base case, most would face payback
periods in excess of 3 years. The limited number of manufacturers
currently producing batch commercial ice makers that meet this
efficiency level is cause for additional concern. After weighing the
burdens of TSL 5 against the benefits, DOE finds TSL 5 not to be
economically justified. DOE does not propose to adopt TSL 5 in this
rulemaking.
TSL 4, the next highest efficiency level, corresponds to the
highest efficiency level with a positive NPV at a 7-percent discount
rate for all equipment classes. The estimated energy savings from 2018
to 2047 are 0.380 quads of energy and 45.4 billion gallons of potable
water--amounts DOE deems significant. At TSL 4, DOE projects an
increase in customer NPV of $0.484 billion (2012$) at a 7-percent
discount rate; estimated emissions reductions of 19.4 MMt of
CO2, 11.6 kt of NOX, and 0.03 tons of Hg. The
monetary value of these emissions was estimated to be up to $1.9
billion for CO2 and up to $7.4 million for NOX at
a 7-percent discount rate.
At TSL 4, the mean LCC savings are positive for all equipment
classes. As shown on Table V.52, mean LCC savings vary from $106 for
SCU-A-Small-B to $945 for IMH-A-Large-B, which implies that, on
average, customers will experience an LCC benefit. However, as shown on
Table V.54, for 11 of the 12 classes, at least some fraction of the
customers will experience net costs. Customers in 3 classes would
experience net LCC costs of 30 percent or more, with the percentage
ranging up to 49 percent for one equipment class. Median payback
periods range from 1.9 years up to 4.8 years, with 7 of the 12 directly
analyzed classes exhibiting payback periods over 3 years.
At TSL 4, the projected change in INPV ranges from a decrease of
$30.5 million to a decrease of $19.6 million.
[[Page 14941]]
The impact on manufacturers at TSL 4 is not significantly different
from that at TSL 5 as the individual efficiency levels for each
equipment class at TSL 4 are on average not significantly different
from those at TSL 5, and in several instances they are the same. DOE
recognizes the risk of negative impacts at TSL 4 if manufacturers'
expectations concerning reduced profit margins are realized. If the
lower bound of -$30.5 million is reached, as DOE expects, TSL 4 could
result in a net loss of 30.0 percent in INPV for manufacturers of
automatic commercial ice makers.
The impacts on manufacturing capacity and competition are of
concern at TSL 4. While every manufacturer who produces continuous
equipment offers at least one product that complies with TSL 4, only
two manufacturers currently produce batch commercial ice makers that
comply with the efficiency levels specified at TSL 4. This includes one
small business manufacturer whose niche products have among the very
largest harvest capacities in their respective equipment classes and
are sold in small quantities relative to the rest of the industry. In
contrast to this small business manufacturer, the other manufacturer is
a larger manufacturer which produces more mainstream batch products and
commands a substantial market share.
The concentration of current production at TSL 4 presents two
issues. One large manufacturer holds intellectual property covering the
evaporator design used in their batch equipment, which in turn limits
the range of possible alternative paths to achieving the efficiency
levels specified at TSL 4. While the engineering analysis identified
other means to achieve these high efficiencies, given this limitation
on design options, other manufacturers expressed significant doubts
regarding their ability to do so. Further, DOE's analysis indicates
that these efficiency levels require the use of permanent magnet motors
and, for most batch equipment, drain water heat exchangers. DOE was
able to identify only one supplier of the latter technology, whose
design is patented. In addition, there is currently very limited use of
permanent magnet motors in commercial ice makers; hence, motor
suppliers would be required to develop and initiate production for a
broad range of new motor designs suitable for automatic commercial ice
makers. These needs could severely impact automatic commercial ice
maker manufacturers' ability to procure the required components in
sufficient quantities to supply the market.
Assuming other paths to achieving these efficiency levels prove
fruitful, TSL 4 would still require that every other manufacturer
retool their entire batch equipment production lines. As noted above,
only 2 manufacturers currently produce equipment that meets TSL 4
efficiency levels, one of which is a large manufacturer. DOE's review
of the efficiency levels of available equipment shows that only 14
percent of the large manufacturer's batch products meet the TSL 4
efficiency levels, suggesting the vast majority of their production
lines would also require redesign and retooling. In confidential
interviews, another manufacturer cited the possibility of a 3-month to
6-month shutdown in the event that amended standards were set high
enough to require retooling of their entire product line. Compounding
this effect across the industry could severely impact manufacturing
capacity in the interim period between the announcement of the
standards and the compliance date.
After carefully considering the analysis results and weighing the
benefits and burdens of TSL 4, DOE finds that at TSL 4, the benefits to
the Nation in the form of energy savings and emissions reductions plus
an increase of $0.484 billion in customer NPV are weighed against a
decrease of up to 30.0 percent in INPV. While most individual customers
purchasing automatic commercial ice makers built to TSL 4 standards
would be better off than in the base case, customers in 7 of 12
equipment classes would face payback periods in excess of 3 years. The
limited number of manufacturers currently producing batch commercial
ice makers that meet this efficiency level is cause for additional
concern. After weighing the burdens of TSL 4 against the benefits, DOE
finds TSL 4 not to be economically justified. DOE does not propose to
adopt TSL 4 in this notice.
At TSL 3, the next highest efficiency level, estimated energy
savings from 2018 to 2047 are 0.286 quads of primary energy and water
savings are 45.4 billion gallons--amounts DOE considers significant.
TSL 3 was defined as the set of efficiencies with the highest NPV for
each analyzed equipment class. At TSL 3, DOE projects an increase in
customer NPV of $0.791 billion at a 7-percent discount rate, and an
increase of $1.751 billion at a 3-percent discount rate. Estimated
emissions reductions are 14.6 MMt of CO2, up to 8.7 kt of
NOX and 0.02 tons of Hg at TSL 3. The monetary value of the
CO2 emissions reductions was estimated to be up to $1.4
billion at TSL 3, while NOX emission reductions at a 7-
percent discount rate were valued at up to $5.5 million.
At TSL 3, nearly all customers for all equipment classes are shown
to experience positive LCC savings. As shown on Table V.54, the percent
of customers experiencing a net cost rounds to 0 in all but two
classes--SCU-A-Large-B with 0.1 percent and IMH-W-Small-B with 3.5
percent of customers exhibiting a net cost. The payback period for IMH-
W-Small-B is 2.3 years, while for all other equipment classes the
median payback periods are 1.9 years or less. LCC savings range from
$146 for SCU-A-Small-C to over $1,100 for IMH-A-Large-B.
At TSL 3, the projected change in INPV ranges from a decrease of
$23.9 million to a decrease of $20.9 million. The three largest
manufacturers, who together represent an estimated 95 percent of the
market, currently produce a combined 38 compliant batch products at TSL
3. Many of the gains in efficiency needed to meet the standards
proposed at TSL 3 can be achieved using higher efficiency components as
opposed to the redesign of systems manufactured in-house and as such
require little change to existing manufacturing capital. The lack of
green-field redevelopment or significant recapitalization mitigates the
risk of disruption to manufacturing capacity in the interim period
between announcement of the energy conservation standards and the
compliance date.
At TSL 3, the monetized CO2 emissions reduction values
range from $0.102 to $1.426 billion. The monetized CO2
emissions reduction at $39.7 per ton in 2012$ is $0.463 billion. The
monetized NOX emissions reductions calculated at an
intermediate value of $2,639 per ton in 2012$ are $3 million at a 7-
percent discount rate and $9.6 million at a 3-percent rate. These
monetized emissions reduction values were added to the customer NPV at
3-percent and 7-percent discount rates to obtain values of $2.223
billion and 1.257 billion, respectively, at TSL 3. The total customer
and emissions benefits are highest at TSL 3.
Nearly all customers are expected to experience net benefits from
equipment built to TSL 3 levels. The payback periods for TSL 3 are
expected to be 2.3 years, or less.
After carefully considering the analysis results and weighing the
benefits and burdens of TSL 3, DOE believes that setting the standards
for automatic commercial ice makers at TSL 3 represents the maximum
improvement in energy efficiency that is technologically feasible and
[[Page 14942]]
economically justified. TSL 3 is technologically feasible because the
technologies required to achieve these levels already exist in the
current market and are available from multiple manufacturers. TSL 3 is
economically justified because the benefits to the Nation in the form
of energy savings, customer NPV at 3 percent and at 7 percent, and
emissions reductions outweigh the costs associated with reduced INPV
and potential effects of reduced manufacturing capacity.
Therefore, DOE proposes the adoption of amended energy conservation
standards for automatic commercial ice makers at TSL 3.
DOE specifically seeks comment on the magnitude of the estimated
decline in INPV at TSL 3 compared to the baseline, and whether this
impact could risk industry consolidation. DOE also specifically
requests comment on whether DOE should adopt TSL 4 or 5 and why., DOE
may reexamine the proposed level depending on the nature of the
information it receives during the comment period and adjust its final
levels in response to that information.
VI. Procedural Issues and Regulatory Review
A. Review Under Executive Orders 12866 and 13563
Section 1(b)(1) of Executive Order 12866, ``Regulatory Planning and
Review,'' 58 FR 51735 (Oct. 4, 1993), requires each agency to identify
the problem that it intends to address, including, where applicable,
the failures of private markets or public institutions that warrant new
agency action, as well as to assess the significance of that problem.
The problems that today's standards address are as follows:
1. There is a lack of consumer information and/or information
processing capability about energy efficiency opportunities in the
automatic commercial ice maker market.
2. There is asymmetric information (one party to a transaction has
more and better information than the other) and/or high transactions
costs (costs of gathering information and effecting exchanges of goods
and services).
3. There are external benefits resulting from improved energy
efficiency of automatic commercial ice makers that are not captured by
the users of such equipment. These benefits include externalities
related to environmental protection and energy security that are not
reflected in energy prices, such as reduced emissions of GHGs.
In addition, DOE has determined that today's regulatory action is
an ``economically significant regulatory action'' under section 3(f)(1)
of Executive Order 12866. Accordingly, section 6(a)(3) of the Executive
Order requires that DOE prepare an RIA on today's rule and that OIRA in
OMB review this rule. DOE presented to OIRA for review the draft rule
and other documents prepared for this rulemaking, including the RIA.
DOE has included these documents in the rulemaking record. The
assessments prepared pursuant to Executive Order 12866 can be found in
the TSD for this rulemaking.
DOE has also reviewed this regulation pursuant to Executive Order
13563, issued on January 18, 2011. 76 FR 3821 (Jan. 21, 2011).
Executive Order 13563 is supplemental to and explicitly reaffirms the
principles, structures, and definitions governing regulatory review
established in Executive Order 12866. To the extent permitted by law,
agencies are required by Executive Order 13563 to: (1) propose or adopt
a regulation only upon a reasoned determination that its benefits
justify its costs (recognizing that some benefits and costs are
difficult to quantify); (2) tailor regulations to impose the least
burden on society, consistent with obtaining regulatory objectives,
taking into account, among other things, and to the extent practicable,
the costs of cumulative regulations; (3) select, in choosing among
alternative regulatory approaches, those approaches that maximize net
benefits (including potential economic, environmental, public health
and safety, and other advantages; distributive impacts; and equity);
(4) to the extent feasible, specify performance objectives, rather than
specifying the behavior or manner of compliance that regulated entities
must adopt; and (5) identify and assess available alternatives to
direct regulation, including providing economic incentives to encourage
the desired behavior, such as user fees or marketable permits, or
providing information upon which choices can be made by the public.
DOE emphasizes as well that Executive Order 13563 requires agencies
to use the best available techniques to quantify anticipated present
and future benefits and costs as accurately as possible. In its
guidance, ORIA has emphasized that such techniques may include
identifying changing future compliance costs that might result from
technological innovation or anticipated behavioral changes. For the
reasons stated in the preamble, DOE believes that today's NOPR is
consistent with these principles, including the requirement that, to
the extent permitted by law, benefits justify costs and that net
benefits are maximized.
B. Review Under the Regulatory Flexibility Act
The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires
preparation of an initial regulatory flexibility analysis (IRFA) for
any rule that by law must be proposed for public comment, unless the
agency certifies that the rule, if promulgated, will not have a
significant economic impact on a substantial number of small entities.
As required by Executive Order 13272, ``Proper Consideration of Small
Entities in Agency Rulemaking'' 67 FR 53461 (Aug. 16, 2002), DOE
published procedures and policies on February 19, 2003 to ensure that
the potential impacts of its rules on small entities are properly
considered during the rulemaking process. 68 FR at 7990. DOE has made
its procedures and policies available on the Office of the General
Counsel's Web site (https://energy.gov/gc/downloads/executive-order-13272-consideration-small-entities-agency-rulemaking).
1. Description and Estimated Number of Small Entities Regulated
For manufacturers of automatic commercial ice makers, the SBA has
set a size threshold, which defines those entities classified as
``small businesses'' for the purposes of the statute. DOE used the
SBA's small business size standards to determine whether any small
entities would be subject to the requirements of the rule. 65 FR 30836,
30848 (May 15, 2000), as amended at 65 FR 53533, 53544 (Sept. 5, 2000)
and codified at 13 CFR part 121. The size standards are listed by NAICS
code and industry description and are available at: www.sba.gov/sites/default/files/files/Size_Standards_Table.pdf.
Manufacturing of automatic commercial ice makers is classified
under NAICS 333415, ``Air-Conditioning and Warm Air Heating Equipment
and Commercial and Industrial Refrigeration Equipment Manufacturing,''
which includes ice-making machinery manufacturing. The SBA sets a
threshold of 750 employees or less for an entity to be considered as a
small business in this category.
During its market survey, DOE used available public information to
identify potential small manufacturers. DOE's research involved
industry trade association membership directories (including AHRI),
public databases (e.g.,
[[Page 14943]]
AHRI Directory,\74\ the SBA Database \75\), individual company Web
sites, and market research tools (e.g., Hoovers reports \76\) to create
a list of companies that manufacture or sell equipment covered by this
rulemaking. DOE also asked stakeholders and industry representatives if
they were aware of any other small manufacturers during manufacturer
interviews and at DOE public meetings. DOE reviewed publicly available
data and contacted select companies on its list, as necessary, to
determine whether they met the SBA's definition of a small business
manufacturer of covered automatic commercial ice makers. DOE screened
out companies that do not offer equipment covered by this rulemaking,
do not meet the definition of a ``small business,'' or are foreign-
owned.
---------------------------------------------------------------------------
\74\ See www.ahridirectory.org/ahriDirectory/pages/home.aspx.
\75\ See https://dsbs.sba.gov/dsbs/search/dsp_dsbs.cfm.
\76\ See www.hoovers.com/.
---------------------------------------------------------------------------
DOE identified seven small domestic businesses manufacturers of
automatic commercial ice makers operating in the United States. DOE
contacted each of these companies, but only one accepted the invitation
to participate in a confidential manufacturer impact analysis interview
with DOE contractors.
2. Description and Estimate of Compliance Requirements
DOE estimates that the seven small domestic manufacturers of
automatic commercial ice makers identified by DOE account for
approximately 5 percent of industry shipments. While small business
manufacturers of automatic commercial ice makers have small overall
market share, some hold substantial market share in specific equipment
classes. Several of these smaller firms specialize in producing
industrial ice machines and the covered equipment they manufacture are
extensions of existing product lines that fall within the range of
capacity covered by this rule. Others serve niche markets. Most have
substantial portions of their business derived from equipment outside
the scope of this rulemaking, but are still considered small businesses
based on the SBA limits for number of employees.
At the proposed level, small business manufacturers of automatic
commercial ice makers are expected to face negative impacts on INPV
that are more than three times as severe as those felt by the industry
at large: A loss of 78.6 percent of INPV for small businesses alone as
compared to a loss of 23.5 percent for the industry at large. Where
conversion costs are driven by the number of platforms requiring
redesign at a particular standard level, small business manufacturers
may be disproportionately affected. Product conversion costs including
the investments made to redesign existing equipment to meet new or
amended standards or to develop entirely new compliant equipment, as
well as industry certification costs, do not scale with sales volume.
As small manufacturers' investments are spread over a much lower volume
of shipments, recovering the cost of upfront investments is
proportionately more difficult.
Similarly, capital conversion costs may disproportionately affect
small business manufacturers of automatic commercial ice makers.
Capital conversion costs are projected to be highest in the year
preceding standards as manufacturers retrofit production lines to make
compliant equipment. In this year, capital conversion costs are
estimated to represent 97 percent of typical capital expenditures for
small businesses, as compared to 34 percent for the industry as a
whole. Where the covered equipment from several small manufacturers are
adaptations of larger platforms with capacities above the 4,000 lb ice/
24 hour threshold, it may not prove economical for them to retrofit an
entire production line to meet standards that only affect one product.
In confidential interviews, manufacturers indicated that many
design options evaluated in the engineering analysis (e.g., higher
efficiency motors and compressors) would require them to purchase more
expensive components. In many industries, small manufacturers typically
pay higher prices for components due to smaller purchasing volumes
while their large competitors receive volume discounts. However, this
effect is diminished for the automatic commercial ice maker
manufacturing industry for two distinct reasons. One reason relates to
the fact that the automatic commercial ice maker industry as a whole is
a low volume industry. In confidential interviews, manufacturers
indicated that they have little influence over their suppliers,
suggesting the volume of their component orders is similarly
insufficient to receive substantial discounts. The second reason
relates to the fact that, for most small businesses, the equipment
covered by this rulemaking represents only a fraction of overall
business. Where small businesses are ordering similar components for
non-covered equipment, their purchase volumes may not be as low as is
indicated by the total unit shipments for small businesses. For these
reasons, it is expected that any volume discount for components enjoyed
by large manufacturers would not be substantially different from the
prices paid by small business manufacturers.
To estimate how small manufacturers would be potentially impacted,
DOE developed specific small business inputs and scaling factors for
the GRIM. These inputs were scaled from those used in the whole
industry GRIM using information about the product portfolios of small
businesses and the estimated market share of these businesses in each
equipment class. DOE used this information in the GRIM to estimate the
annual revenue, EBIT, R&D expense, and capital expenditures for a
typical small manufacturer and to model the impact on INPV. DOE then
compared these impacts to those modeled for the industry at large. The
results are shown on Table VI.1 and Table VI.2.
Table VI.1--Comparison of Small Business Manufacturers of Automatic Commercial Ice Maker INPV to That of the
Industry at Large by TSL Under the Preservation of Gross Margin Markup Scenario*
----------------------------------------------------------------------------------------------------------------
TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
----------------------------------------------------------------------------------------------------------------
Industry at Large--Impact on $(8.4) $(12.8) $(20.9) $(19.6) $(19.9)
INPV ($2012)...................
Industry at Large--Impact on (8.2)% (12.6)% (20.5)% (19.2)% (19.5)%
INPV (%).......................
Small Businesses--Impact on INPV $(1.8) $(2.9) $(3.9) $(4.1) $(4.5)
($2012)........................
Small Businesses--Impact on INPV (35.4)% (57.0)% (76.6)% (80.5)% (88.4)%
(%)............................
----------------------------------------------------------------------------------------------------------------
*Values in parentheses are negative numbers.
[[Page 14944]]
Table VI.2--Comparison of Small Business Manufacturers of Automatic Commercial Ice Maker INPV to That of the
Industry at Large by TSL Under the Preservation of EBIT Markup Scenario
----------------------------------------------------------------------------------------------------------------
TSL 1 TSL 2 TSL 3 TSL 4 TSL 5
----------------------------------------------------------------------------------------------------------------
Industry at Large--Impact on $(8.7) $(13.6) $(23.9) $(30.5) $(32.6)
INPV ($2012)...................
Industry at Large--Impact on (8.5)% (13.4)% (23.5)% (30.0)% (32.0)%
INPV (%).......................
Small Businesses--Impact on INPV $(1.8) $(3.0) $(4.0) $(4.6) $(5.1)
($2012)........................
Small Businesses--Impact on INPV (35.4)% (58.9)% (78.6)% (90.3)% (100.2)%
(%)............................
----------------------------------------------------------------------------------------------------------------
*Values in parentheses are negative numbers.
3. Duplication, Overlap, and Conflict With Other Rules and Regulations
DOE is not aware of any rules or regulations that duplicate,
overlap, or conflict with the rule being promulgated today.
4. Significant Alternatives to the Rule
The primary alternatives to the proposed rule are the other TSLs
besides the one being considered today, TSL 3. DOE explicitly
considered the role of manufacturers, including small manufacturers, in
its selection of TSL 3 rather than TSLs 4 or 5. Though higher TSLs
result in greater energy savings for the country, they would place
significant burdens on manufacturers. Chapter 12 of the NOPR TSD
contains additional information about the impact of this rulemaking on
manufacturers.
In addition to the other TSLs being considered, chapter 17 of the
NOPR TSD and Section V.B.7 include reports on a regulatory impact
analysis (RIA). For automatic commercial ice makers, the RIA discusses
the following policy alternatives: (1) No change in standard; (2)
customer rebates; (3) customer tax credits; (4) manufacturer tax
credits; and (5) early replacement. While these alternatives may
mitigate to some varying extent the economic impacts on small entities
compared to the amended standards, DOE determined that the energy
savings of these regulatory alternatives could be approximately one-
third to one-half less than the savings that would be expected to
result from adoption of the amended standard levels. Because of the
significantly lower savings, DOE rejected these alternatives and
proposes to adopt the amended standards set forth in this rulemaking.
However, DOE seeks comment and, in particular, data on the impacts
of this rulemaking upon small businesses. (See Issue 10 under ``Issues
on Which DOE Seeks Comment'' in section VII.E of this NOPR.)
C. Review Under the Paperwork Reduction Act
Manufacturers of automatic commercial ice makers must certify to
DOE that their equipment comply with any applicable energy conservation
standards. In certifying compliance, manufacturers must test their
equipment according to the DOE test procedures for automatic commercial
ice makers, including any amendments adopted for those test procedures.
DOE has established regulations for the certification and recordkeeping
requirements for all covered consumer products and commercial/
industrial equipment, including automatic commercial ice makers. 76 FR
12422 (March 7, 2011). The collection-of-information requirement for
the certification and recordkeeping is subject to review and approval
by OMB under the Paperwork Reduction Act (PRA). This requirement has
been approved by OMB under OMB Control Number 1910-1400. Public
reporting burden for the certification is estimated to average 20 hours
per response, including the time for reviewing instructions, searching
existing data sources, gathering and maintaining the data needed, and
completing and reviewing the collection of information.
Notwithstanding any other provision of the law, no person is
required to respond to, nor shall any person be subject to a penalty
for failure to comply with, a collection of information subject to the
requirements of the PRA, unless that collection of information displays
a currently valid OMB Control Number.
D. Review Under the National Environmental Policy Act of 1969
Pursuant to the National Environmental Policy Act (NEPA) of 1969,
(42 U.S.C. 4321 et seq.) DOE has determined that the proposed rule fits
within the category of actions included in Categorical Exclusion (CX)
B5.1 and otherwise meets the requirements for application of a CX. See
10 CFR part 1021, appendix B, B5.1(b); 1021.410(b) and appendix B,
B(1)-(5). The proposed rule fits within the category of actions because
it is a rulemaking that establishes energy conservation standards for
consumer products or industrial equipment, and for which none of the
exceptions identified in CX B5.1(b) apply. Therefore, DOE has made a CX
determination for this rulemaking, and DOE does not need to prepare an
Environmental Assessment or Environmental Impact Statement for this
proposed rule. DOE's CX determination for this proposed rule is
available at https://energy.gov/nepa/downloads/cx-008014-categorical-exclusion-determination.
E. Review Under Executive Order 13132
Executive Order 13132, ``Federalism,'' 64 FR 43255 (Aug. 10, 1999),
imposes certain requirements on Federal agencies formulating and
implementing policies or regulations that preempt State law or that
have Federalism implications. The Executive Order requires agencies to
examine the constitutional and statutory authority supporting any
action that would limit the policymaking discretion of the States and
to carefully assess the necessity for such actions. The Executive Order
also requires agencies to have an accountable process to ensure
meaningful and timely input by State and local officials in the
development of regulatory policies that have Federalism implications.
On March 14, 2000, DOE published a statement of policy describing the
intergovernmental consultation process it will follow in the
development of such regulations. 65 FR at 13735. EPCA governs and
prescribes Federal preemption of State regulations as to energy
conservation for the products that are the subject of today's proposed
rule. States can petition DOE for exemption from such preemption to the
extent, and based on criteria, set forth in EPCA. (42 U.S.C. 6297) No
further action is required by Executive Order 13132.
F. Review Under Executive Order 12988
With respect to the review of existing regulations and the
promulgation of new regulations, section 3(a) of Executive Order 12988,
``Civil Justice Reform,'' imposes on Federal agencies the general duty
to adhere to the following requirements: (1) Eliminate drafting errors
and ambiguity; (2) write regulations to minimize litigation; and (3)
provide a clear legal standard for affected conduct rather than a
general
[[Page 14945]]
standard and promote simplification and burden reduction. 61 FR 4729
(Feb. 7, 1996). Section 3(b) of Executive Order 12988 specifically
requires that Executive agencies make every reasonable effort to ensure
that the regulation: (1) Clearly specifies the preemptive effect, if
any; (2) clearly specifies any effect on existing Federal law or
regulation; (3) provides a clear legal standard for affected conduct
while promoting simplification and burden reduction; (4) specifies the
retroactive effect, if any; (5) adequately defines key terms; and (6)
addresses other important issues affecting clarity and general
draftsmanship under any guidelines issued by the Attorney General.
Section 3(c) of Executive Order 12988 requires Executive agencies to
review regulations in light of applicable standards in section 3(a) and
section 3(b) to determine whether they are met or it is unreasonable to
meet one or more of them. DOE has completed the required review and
determined that, to the extent permitted by law, this proposed rule
meets the relevant standards of Executive Order 12988.
G. Review Under the Unfunded Mandates Reform Act of 1995
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA)
requires each Federal agency to assess the effects of Federal
regulatory actions on State, local, and Tribal governments and the
private sector. Public Law 104-4, sec. 201 (codified at 2 U.S.C. 1531).
For a proposed regulatory action likely to result in a rule that may
cause the expenditure by State, local, and Tribal governments, in the
aggregate, or by the private sector of $100 million or more in any one
year (adjusted annually for inflation), section 202 of UMRA requires a
Federal agency to publish a written statement that estimates the
resulting costs, benefits, and other effects on the national economy.
(2 U.S.C. 1532(a),(b)) The UMRA also requires a Federal agency to
develop an effective process to permit timely input by elected officers
of State, local, and Tribal governments on a proposed ``significant
intergovernmental mandate,'' and requires an agency plan for giving
notice and opportunity for timely input to potentially affected small
governments before establishing any requirements that might
significantly or uniquely affect small governments. On March 18, 1997,
DOE published a statement of policy on its process for
intergovernmental consultation under UMRA. 62 FR at 12820. DOE's policy
statement is also available at https://energy.gov/gc/downloads/unfunded-mandates-reform-act-intergovernmental-consultation.
Although today's proposed rule does not contain a Federal
intergovernmental mandate, it may require expenditures of $100 million
or more on the private sector. Specifically, the proposed rule will
likely result in a final rule that could require expenditures of $100
million or more. Such expenditures may include: (1) Investment in
research and development and in capital expenditures by automatic
commercial ice makers manufacturers in the years between the final rule
and the compliance date for the new standards; and (2) incremental
additional expenditures by customers to purchase higher efficiency
automatic commercial ice makers, starting at the compliance date for
the applicable standard.
Section 202 of UMRA authorizes a Federal agency to respond to the
content requirements of UMRA in any other statement or analysis that
accompanies the proposed rule. (2 U.S.C. 1532(c)) The content
requirements of section 202(b) of UMRA relevant to a private sector
mandate substantially overlap the economic analysis requirements that
apply under section 325(o) of EPCA and Executive Order 12866. The
SUPPLEMENTARY INFORMATION section of this NOPR and the ``Regulatory
Impact Analysis'' section of the NOPR TSD for this proposed rule
respond to those requirements.
Under section 205 of UMRA, DOE is obligated to identify and
consider a reasonable number of regulatory alternatives before
promulgating a rule for which a written statement under section 202 is
required. (2 U.S.C. 1535(a)) DOE is required to select from those
alternatives the most cost-effective and least burdensome alternative
that achieves the objectives of the proposed rule unless DOE publishes
an explanation for doing otherwise, or the selection of such an
alternative is inconsistent with law. As required by 42 U.S.C. 6295(o)
and 6313(d), this proposed rule would establish energy conservation
standards for automatic commercial ice makers that are designed to
achieve the maximum improvement in energy efficiency that DOE has
determined to be both technologically feasible and economically
justified. A full discussion of the alternatives considered by DOE is
presented in the ``Regulatory Impact Analysis'' section of the TSD for
today's proposed rule.
H. Review Under the Treasury and General Government Appropriations Act,
1999
Section 654 of the Treasury and General Government Appropriations
Act, 1999 (Pub. L. 105-277) requires Federal agencies to issue a Family
Policymaking Assessment for any rule that may affect family well-being.
This rule would not have any impact on the autonomy or integrity of the
family as an institution. Accordingly, DOE has concluded that it is not
necessary to prepare a Family Policymaking Assessment.
I. Review Under Executive Order 12630
DOE has determined, under Executive Order 12630, ``Governmental
Actions and Interference with Constitutionally Protected Property
Rights,'' 53 FR 8859 (Mar. 18, 1988), that this regulation would not
result in any takings that might require compensation under the Fifth
Amendment to the U.S. Constitution.
J. Review Under the Treasury and General Government Appropriations Act,
2001
Section 515 of the Treasury and General Government Appropriations
Act, 2001 (44 U.S.C. 3516, note) provides for Federal agencies to
review most disseminations of information to the public under
guidelines established by each agency pursuant to general guidelines
issued by OMB. OMB's guidelines were published at 67 FR 8452 (Feb. 22,
2002), and DOE's guidelines were published at 67 FR 62446 (Oct. 7,
2002). DOE has reviewed today's NOPR under the OMB and DOE guidelines
and has concluded that it is consistent with applicable policies in
those guidelines.
K. Review Under Executive Order 13211
Executive Order 13211, ``Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use,'' 66 FR 28355
(May 22, 2001), requires Federal agencies to prepare and submit to OIRA
at OMB a Statement of Energy Effects for any proposed significant
energy action. A ``significant energy action'' is defined as any action
by an agency that promulgates or is expected to lead to promulgation of
a final rule, and that: (1) Is a significant regulatory action under
Executive Order 12866, or any successor order; and (2) is likely to
have a significant adverse effect on the supply, distribution, or use
of energy, or (3) is designated by the Administrator of OIRA as a
significant energy action. For any proposed significant energy action,
the agency must give a detailed statement of any adverse effects on
energy supply, distribution, or use should the proposal be implemented,
and of reasonable alternatives to the
[[Page 14946]]
action and their expected benefits on energy supply, distribution, and
use.
DOE has tentatively concluded that today's regulatory action, which
sets forth proposed energy conservation standards for automatic
commercial ice makers, is not a significant energy action because the
proposed standards are not likely to have a significant adverse effect
on the supply, distribution, or use of energy, nor has it been
designated as such by the Administrator at OIRA. Accordingly, DOE has
not prepared a Statement of Energy Effects on the proposed rule.
L. Review Under the Information Quality Bulletin for Peer Review
On December 16, 2004, OMB, in consultation with the Office of
Science and Technology Policy (OSTP), issued its Final Information
Quality Bulletin for Peer Review (the Bulletin). 70 FR 2664 (Jan. 14,
2005). The Bulletin establishes that certain scientific information
shall be peer-reviewed by qualified specialists before it is
disseminated by the Federal Government, including influential
scientific information related to agency regulatory actions. The
purpose of the Bulletin is to enhance the quality and credibility of
the Government's scientific information. Under the Bulletin, the energy
conservation standards rulemaking analyses are ``influential scientific
information,'' which the Bulletin defines as scientific information the
agency reasonably can determine will have, or does have, a clear and
substantial impact on important public policies or private sector
decisions. 70 FR at 2667 (Jan. 14, 2005).
In response to OMB's Bulletin, DOE conducted formal in-progress
peer reviews of the energy conservation standards development process
and analyses and has prepared a Peer Review Report pertaining to the
energy conservation standards rulemaking analyses. Generation of this
report involved a rigorous, formal, and documented evaluation using
objective criteria and qualified and independent reviewers to make a
judgment as to the technical/scientific/business merit, the actual or
anticipated results, and the productivity and management effectiveness
of programs and/or projects. The ``Energy Conservation Standards
Rulemaking Peer Review Report,'' dated February 2007, has been
disseminated and is available at the following Web site:
www1.eere.energy.gov/buildings/appliance_standards/peer_review.html.
VII. Public Participation
A. Attendance at the Public Meeting
The time, date, and location of the public meeting are listed in
the DATES and ADDRESSES sections at the beginning of this rulemaking.
If you plan to attend the public meeting, please notify Ms. Brenda
Edwards at (202) 586-2945 or Brenda.Edwards@ee.doe.gov. Please note
that foreign nationals visiting DOE Headquarters are subject to advance
security screening procedures. Any foreign national wishing to
participate in the meeting should advise DOE as soon as possible by
contacting Ms. Edwards to initiate the necessary procedures. Please
also note that those wishing to bring laptops into the Forrestal
Building will be required to obtain a property pass. Visitors should
avoid bringing laptops, or allow an extra 45 minutes. Persons can
attend the public meeting via webinar.
Webinar registration information, participant instructions, and
information about the capabilities available to webinar participants
will be published on DOE's Web site at: www1.eere.energy.gov/buildings/appliance_standards/rulemaking.aspx/ruleid/29.
Participants are responsible for ensuring their systems are
compatible with the webinar software.
B. Procedure for Submitting Prepared General Statements for
Distribution
Any person who has plans to present a prepared general statement
may request that copies of his or her statement be made available at
the public meeting. Such persons may submit requests, along with an
advance electronic copy of their statement in PDF (preferred),
Microsoft Word or Excel, WordPerfect, or text (ASCII) file format, to
the appropriate address shown in the ADDRESSES section at the beginning
of this notice. The request and advance copy of statements must be
received at least one week before the public meeting and may be
emailed, hand-delivered, or sent by mail. DOE prefers to receive
requests and advance copies via email. Please include a telephone
number to enable DOE staff to make follow-up contact, if needed.
C. Conduct of the Public Meeting
DOE will designate a DOE official to preside at the public meeting
and may also use a professional facilitator to aid discussion. The
meeting will not be a judicial or evidentiary-type public hearing, but
DOE will conduct it in accordance with section 336 of EPCA (42 U.S.C.
6306). A court reporter will be present to record the proceedings and
prepare a transcript. DOE reserves the right to schedule the order of
presentations and to establish the procedures governing the conduct of
the public meeting. After the public meeting, interested parties may
submit further comments on the proceedings as well as on any aspect of
the rulemaking until the end of the comment period.
The public meeting will be conducted in an informal, conference
style. DOE will present summaries of comments received before the
public meeting, allow time for prepared general statements by
participants, and encourage all interested parties to share their views
on issues affecting this rulemaking. Each participant will be allowed
to make a general statement (within time limits determined by DOE),
before the discussion of specific topics. DOE will allow, as time
permits, other participants to comment briefly on any general
statements.
At the end of all prepared statements on a topic, DOE will permit
participants to clarify their statements briefly and comment on
statements made by others. Participants should be prepared to answer
questions by DOE and by other participants concerning these issues. DOE
representatives may also ask questions of participants concerning other
matters relevant to this rulemaking. The official conducting the public
meeting will accept additional comments or questions from those
attending, as time permits. The presiding official will announce any
further procedural rules or modification of the above procedures that
may be needed for the proper conduct of the public meeting.
A transcript of the public meeting will be included in the docket,
which can be viewed as described in the Docket section at the beginning
of this rulemaking. In addition, any person may buy a copy of the
transcript from the transcribing reporter.
D. Submission of Comments
DOE will accept comments, data, and information regarding this
proposed rule before or after the public meeting, but no later than the
date provided in the DATES section at the beginning of this proposed
rule. Interested parties may submit comments, data, and other
information using any of the methods described in the ADDRESSES section
at the beginning of this notice.
Submitting comments via regulations.gov. The regulations.gov Web
page will require you to provide your name and contact information.
Your contact information will be viewable to DOE Building Technologies
staff only. Your contact information will
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not be publicly viewable except for your first and last names,
organization name (if any), and submitter representative name (if any).
If your comment is not processed properly because of technical
difficulties, DOE will use this information to contact you. If DOE
cannot read your comment due to technical difficulties and cannot
contact you for clarification, DOE may not be able to consider your
comment.
However, your contact information will be publicly viewable if you
include it in the comment itself or in any documents attached to your
comment. Any information that you do not want to be publicly viewable
should not be included in your comment, nor in any document attached to
your comment. Otherwise, persons viewing comments will see only first
and last names, organization names, correspondence containing comments,
and any documents submitted with the comments.
Do not submit to regulations.gov information for which disclosure
is restricted by statute, such as trade secrets and commercial or
financial information (hereinafter referred to as Confidential Business
Information (CBI)). Comments submitted through regulations.gov cannot
be claimed as CBI. Comments received through the Web site will waive
any CBI claims for the information submitted. For information on
submitting CBI, see the Confidential Business Information section
below.
DOE processes submissions made through regulations.gov before
posting. Normally, comments will be posted within a few days of being
submitted. However, if large volumes of comments are being processed
simultaneously, your comment may not be viewable for up to several
weeks. Please keep the comment tracking number that regulations.gov
provides after you have successfully uploaded your comment.
Submitting comments via email, hand delivery/courier, or mail.
Comments and documents submitted via email, hand delivery, or mail also
will be posted to regulations.gov. If you do not want your personal
contact information to be publicly viewable, do not include it in your
comment or any accompanying documents. Instead, provide your contact
information in a cover letter. Include your first and last names, email
address, telephone number, and optional mailing address. The cover
letter will not be publicly viewable as long as it does not include any
comments.
Include contact information each time you submit comments, data,
documents, and other information to DOE. If you submit via mail or hand
delivery/courier, please provide all items on a CD, if feasible. It is
not necessary to submit printed copies. No facsimiles (faxes) will be
accepted.
Comments, data, and other information submitted to DOE
electronically should be provided in PDF (preferred), Microsoft Word or
Excel, WordPerfect, or text (ASCII) file format. Provide documents that
are not secured, that are written in English, and that are free of any
defects or viruses. Documents should not contain special characters or
any form of encryption and, if possible, they should carry the
electronic signature of the author.
Campaign form letters. Please submit campaign form letters by the
originating organization in batches of between 50 to 500 form letters
per PDF or as one form letter with a list of supporters' names compiled
into one or more PDFs. This reduces comment processing and posting
time.
Confidential Business Information. According to 10 CFR 1004.11, any
person submitting information that he or she believes to be
confidential and exempt by law from public disclosure should submit via
email, postal mail, or hand delivery/courier two well-marked copies:
one copy of the document marked confidential including all the
information believed to be confidential, and one copy of the document
marked non-confidential with the information believed to be
confidential deleted. Submit these documents via email or on a CD, if
feasible. DOE will make its own determination about the confidential
status of the information and treat it according to its determination.
Factors of interest to DOE when evaluating requests to treat
submitted information as confidential include: (1) A description of the
items; (2) whether and why such items are customarily treated as
confidential within the industry; (3) whether the information is
generally known by or available from other sources; (4) whether the
information has previously been made available to others without
obligation concerning its confidentiality; (5) an explanation of the
competitive injury to the submitting person which would result from
public disclosure; (6) when such information might lose its
confidential character due to the passage of time; and (7) why
disclosure of the information would be contrary to the public interest.
It is DOE's policy that all comments may be included in the public
docket, without change and as received, including any personal
information provided in the comments (except information deemed to be
exempt from public disclosure).
E. Issues on Which DOE Seeks Comment
Although DOE welcomes comments on any aspect of this proposal, DOE
is particularly interested in receiving comments and views of
interested parties concerning the following issues.
1. Standards Compliance Dates
EPCA requires that the amended standards established in this
rulemaking must apply to equipment that is manufactured on or after 3
years after the final rule is published in the Federal Register unless
DOE determines, by rule, that a 3-year period is inadequate, in which
case DOE may extend the compliance date for that standard by an
additional 2 years. (42 U.S.C. 6313(d)(3)(C))
For the NOPR analyses, DOE assumed a 3-year period to prepare for
compliance. DOE requests comments on the January 1, 2018 effective
date, and whether a January 1, 2018 effective date provides an
inadequate period for compliance and what economic impacts would be
mitigated by a later effective date.
DOE also requests comment on whether the 3-year period is adequate
for manufacturers to obtain more efficient components from suppliers to
meet proposed revisions of standards. More discussion on this topic can
be found in Section IV.B.1.g of today's NOPR.
2. Utilization Factors
The utilization factor represents the percent of time that an ice
maker actively produces ice. Ice maker usage is measured in terms of
kilowatt-hours per 100 lb/24 hours, whereas subsequent analyses require
annual energy usage in kilowatt-hours. Thus, a usage factor is required
to translate the potential energy usage into estimated annual usage. In
the Framework document, the Department presented a series of factors
for each type of building that represents an ice maker market segment,
and all were set to 0.5, meaning all building types would be modeled
with a utilization factor indicating that equipment runs one-half of
the time. The Stakeholders pointed out that not all building segments
should be at 0.5, but DOE did not receive any data or information that
DOE can use to differentiate the utilization factor by building type.
DOE requests data for individual building types. More discussion on
this topic can be found in Section IV.G.3 of today's NOPR.
[[Page 14948]]
3. Baseline Efficiency
For this notice, DOE chose continuous machine baselines at
sufficiently high energy use levels that they exclude almost no
equipment. DOE based the baselines on online data from the AHRI
database. DOE requests comments on the development of continuous type
equipment base efficiency levels and on the availability of data on
which to create continuous machine baselines. More discussion on this
topic can be found in Section IV.D.2.a of today's NOPR.
4. Screening Analysis
DOE requests comment on the screening analysis and, specifically,
the design options DOE screened out of the rulemaking analysis.
DOE considered whether design options were technologically
feasible; practicable to manufacture, install, or service; had adverse
impacts on product utility or product availability; or had adverse
impacts on health or safety. See Section IV.C of today's NOPR and
chapter 4 of the NOPR TSD for further discussion of the screening
analysis.
5. Maximum Technologically Feasible Levels
DOE seeks comments on the Maximum Technologically Feasible levels
proposed in Table III.2 and Table III.3 of today's notice. More
discussion on this topic can be found in Section IV.D.2.e of today's
NOPR.
6. Markups to Determine Price
DOE identified three major distribution channels through which
automatic commercial ice maker equipment is purchased by the end-user:
(1) Manufacturer to end-user (direct channel); (2) manufacturer to
wholesale distributor to end-user (wholesaler channel); and (3)
manufacturer to distributor to dealer or contractor to end-user
(contractor channel). DOE currently uses mechanical contractor data to
estimate the contribution of local dealers or contactors to end-user
prices. DOE requests specific input to improve the cost estimation for
the local dealer or contractor component of markups. More discussion on
this topic can be found in Section IV.E of today's NOPR.
7. Equipment Life
For the NOPR analyses, DOE used an 8.5 years average life for all
equipment classes, with analyses based on a lifetime distribution
averaging 8.5 years. (TSD chapter 9 discusses the development of the
distribution.) In comments on the preliminary analysis, one stakeholder
stated that continuous machines might have shorter life spans. DOE
requests specific information to determine whether continuous and batch
types should be analyzed using different equipment life assumptions,
and if so, what they would be. More discussion on this topic can be
found in Section IV.G.8 of today's NOPR.
8. Installation Costs
Stakeholders commented that higher efficiency equipment would incur
additional installation costs when compared to the baseline equipment.
DOE requests specificity with respect to this comment, with specific
information on design options that will increase installation costs and
specific information to enable DOE to adjust installation costs
appropriately. More discussion on this topic can be found in Section
IV.G.2.a of today's NOPR.
9. Open- Versus Closed-Loop Installations
Stakeholders commented that some localities in the U.S. have
instituted local ordinances or laws precluding installation of ice
makers in open-loop configurations. DOE requests stakeholder assistance
in quantifying the impact of local regulations on the prevalence of
open-loop installations. More discussion on this topic can be found in
Section IV.D.3.c of today's NOPR.
10. Ice Maker Shipments by Type of Equipment
DOE's shipments forecast is based on a single snapshot of shipments
by the type of equipment. Stakeholders at the preliminary analysis
phase suggested that the equipment mix may be changing over time. DOE
requests additional data concerning shipment trends/forecasts. More
discussion on this topic can be found in Section IV.H.1 of today's
NOPR.
11. Intermittency of Manufacturer R&D and Impact of Standards
One manufacturer reported that a previous round of standards
required nearly all of the company's engineering resources for between
1 and 2 years. Where manufacturers may divert existing R&D resources to
compliance related R&D efforts, DOE requests additional comment on the
impact on innovation of compliance related R&D efforts. Specifically,
DOE requests comment on how to quantify this impact on innovation. More
discussion on this topic can be found in Section IV.J of today's NOPR.
12. INPV Results and Impact of Standards
Based on weighing of data, DOE is recommending TSL 3 for the new
and amended automatic commercial ice maker standards. DOE recognizes
that new and amended standards will have impacts on industry net
present value results. DOE specifically seeks comment on the magnitude
of the estimated decline in INPV at TSL 3 compared to the baseline, and
what impact this may have on manufacturers. More discussion on this
topic can be found in Section V.B.2 of today's NOPR.
13. Small Businesses
During the Framework and February 2012 preliminary analysis public
meetings, DOE received many comments regarding the potential impacts of
amended energy conservation standards on small business manufacturers
of automatic commercial ice makers. DOE incorporated this feedback into
its analyses for the NOPR and has presented its results in this notice
and the NOPR TSD. However, DOE seeks comment and, in particular,
additional data, in its efforts to quantify the impacts of this
rulemaking on small businesses. More discussion on this topic can be
found in Section IV.J.3.d of today's NOPR.
14. Consumer Utility and Performance
DOE requests comment on whether there are features or attributes of
the more energy-efficient automatic commercial ice makers, including
any potential changes to the evaporator design that would result in
changes to the ice style or changes in the chassis size, that
manufacturers would produce to meet the standards in this proposed rule
that might affect how they would be used by consumers. DOE requests
comment specifically on how any such effects should be weighed in the
choice of standards for the automatic commercial ice makers for the
final rule. More discussion on this topic can be found in Section V.B.3
of today's NOPR.
15. Analysis Period
For this rulemaking, DOE analyzed the effects of this proposal
assuming that the automatic commercial ice makers would be available to
purchase for 30 years and undertook a sensitivity analysis using 9
years rather than 30 years of product shipments. The choice of a 30-
year period of shipments is consistent with the DOE analysis for other
products and commercial equipment. The choice of a 9-year period is a
proxy for the timeline in EPCA for the review of certain energy
[[Page 14949]]
conservation standards and potential revision of and compliance with
such revised standards. We are seeking input, information and data on
whether there are ways to further refine the analytic timeline. More
discussion on this topic can be found in Section IV.H.1 of today's
NOPR.
16. Social Cost of Carbon
DOE solicits comment on the application of the new SCC values used
to determine the social benefits of CO2 emissions reductions
over the rulemaking analysis period. (The rulemaking analysis period
covers from 2018 to 2047 plus the appropriated number of years to
account for the lifetime of the equipment purchased between 2018 and
2047.) In particular, the agency solicits comment on the agency's
derivation of SCC values after 2050 where the agency applied the
average annual growth rate of the SCC estimates in 2040-2050 associated
with each of the four sets of values. More discussion on this topic can
be found in Section IV.L.1 of today's NOPR.
17. Remote to Rack Equipment
In the preliminary analysis, DOE found that some high-capacity RCU-
RC-Large-C ice makers are solely designed to be used with compressor
racks and the racks' associated condensers. DOE requests comment and
supporting data on the overall market share of these units and any
expected market trends. More discussion on this topic can be found in
Section IV.B.1.f of today's NOPR.
18. Design Options Associated With Each TSL
Section V.A.1 of today's NOPR discusses the design options
associated with each TSL, for each analyzed product class. DOE requests
comment and data related to the required equipment size increases
associated with the design options at each TSL levels. Chapter 5 of the
NOPR TSD contains full descriptions of the design options and DOE's
analyses for the equipment size increase associated with the design
options selected. DOE also requests comments and data on the efficiency
gains associated with each set of design options. Chapter 5 of the NOPR
TSD contains DOE's analyses of the efficiency gains for each design
option considered. Finally, DOE requests comment and data on any
utility impacts associated with each set of design options, such as
potential ice-style changes.
19. Standard Levels for Batch-Type Ice Makers Over 2,500 lbs Ice/24
Hours
DOE requests comment and data on the viability of the proposed
standard levels selected for batch-type ice makers with harvest
capacities from 2,500 to 4,000 lb ice/24 hours. The proposed standard
levels are discussed in Section V.A.2 of today's NOPR, and prior
comments on standards for batch-type ice makers with harvest capacities
from 2,500 to 4,000 lb ice/24 hours are discussed in Section IV.B.1.b
of today's NOPR.
VIII. Approval of the Office of the Secretary
The Secretary of Energy has approved publication of today's
proposed rule.
List of Subjects in 10 CFR Part 431
Administrative practice and procedure, Confidential business
information, Energy conservation, Commercial equipment, Imports,
Intergovernmental relations, Reporting and recordkeeping requirements,
Small businesses.
Issued in Washington, DC, on March 7, 2014.
David T. Danielson,
Assistant Secretary for Energy Efficiency, Energy Efficiency and
Renewable Energy.
For the reasons set forth in the preamble, DOE proposes to amend
part 431 of chapter II of title 10, of the Code of Federal Regulations,
as set forth below:
PART 431--ENERGY EFFICIENCY PROGRAM FOR CERTAIN COMMERCIAL AND
INDUSTRIAL EQUIPMENT
0
1. The authority citation for part 431 continues to read as follows:
Authority: 42 U.S.C. 6291-6317.
0
2. Section 431.136 is revised to read as follows:
Sec. 431.136 Energy conservation standards and their effective dates.
(a) All basic models of commercial ice makers must be tested for
performance using the applicable DOE test procedure in Sec. 431.134,
be compliant with the applicable standards set forth in paragraphs (b)
through (d) of this section, and be certified to the Department of
Energy under 10 CFR part 429.
(b) Each cube type automatic commercial ice maker with capacities
between 50 and 2,500 pounds per 24-hour period manufactured on or after
January 1, 2010 and before [DATE THREE YEARS AFTER PUBLICATION OF FINAL
RULE], shall meet the following standard levels:
--------------------------------------------------------------------------------------------------------------------------------------------------------
Rated harvest rate lb ice/24 Maximum energy use kWh/100 lb Maximum condenser water use*
Equipment type Type of cooling hours ice gal/100 lb ice
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ice-Making Head.................. Water.................... <500 7.8-0.0055H** 200-0.022H.
>=500 and <1,436 5.58-0.0011H 200-0.022H.
>=1,436 4.0 200-0.022H.
Air...................... <450 10.26-0.0086H Not Applicable.
>=450 6.89-0.0011H Not Applicable.
Remote Condensing (but not remote Air...................... <1,000 8.85-0.0038H Not Applicable.
compressor). >=1,000 5.1 Not Applicable.
Remote Condensing and Remote Air...................... <934 8.85-0.0038H Not Applicable.
Compressor. >=934 5.3 Not Applicable.
Self-Contained................... Water.................... <200 11.40-0.019H 191-0.0315H.
>=200 7.6 191-0.0315H.
Air...................... <175 18.0-0.0469H Not Applicable.
>=175 9.8 Not Applicable.
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Water use is for the condenser only and does not include potable water used to make ice.
** H = rated harvest rate in pounds per 24 hours, indicating the water or energy use for a given rated harvest rate.
Source: 42 U.S.C. 6313(d).
(c) Each batch type automatic commercial ice maker with capacities
between 50 and 4,000 pounds per 24-hour period manufactured on or after
[DATE THREE YEARS AFTER
[[Page 14950]]
PUBLICATION OF FINAL RULE], shall meet the following standard levels:
--------------------------------------------------------------------------------------------------------------------------------------------------------
Rated harvest rate lb ice/24 Maximum energy use kWh/100 lb Maximum condenser water
Equipment type Type of cooling hours ice* use** gal/100 lb ice
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ice-Making Head.................. Water.................... <500 5.84-0.0041H 200-0.022H.
>=500 and <1,436 3.88-0.0002H 200-0.022H.
>=1,436 and <2,500 3.6 200-0.022H
>=2,500 and <4,000 3.6 145.
Ice-Making Head.................. Air...................... <450 7.70-0.0065H Not Applicable.
>=450 and <875 5.17-0.0008H Not Applicable.
>=875 and <2,210 4.5 Not Applicable.
>=2,210 and <2,500 6.89-0.0011H Not Applicable.
>=2,500 and <4,000 4.1 Not Applicable.
Remote Condensing (but Not Remote Air...................... <1,000 7.52--0.0032H Not Applicable
Compressor). >=1,000 and <4,000 4.3 Not Applicable.
Remote Condensing and Remote Air...................... <934 7.52-0.0032H Not Applicable.
Compressor. >=934 and <4,000 4.5 Not Applicable.
Self-Contained................... Water.................... <200 8.55-0.0143H 191-0.0315H.
>=200 and <2,500 5.7 191-0.0315H.
>=2,500 and <4,000 5.7 112.
Self-Contained................... Air...................... <175 12.6-0.0328H Not Applicable.
>=175 and <4,000 6.9 Not Applicable.
--------------------------------------------------------------------------------------------------------------------------------------------------------
* H = rated harvest rate in pounds per 24 hours, indicating the water or energy use for a given rated harvest rate.
** Water use is for the condenser only and does not include potable water used to make ice.
Source: 42 U.S.C. 6313(d).
(d) Each continuous type automatic commercial ice maker with
capacities between 50 and 4,000 pounds per 24-hour period manufactured
on or after [DATE THREE YEARS AFTER PUBLICATION OF FINAL RULE], shall
meet the following standard levels:
--------------------------------------------------------------------------------------------------------------------------------------------------------
Rated harvest rate lb ice/24 Maximum energy use kWh/100 lb Maximum condenser water
Equipment type Type of cooling hours ice* use** gal/100 lb ice
--------------------------------------------------------------------------------------------------------------------------------------------------------
Ice-Making Head.................. Water.................... <900 6.08-0.0025H 160-0.0176H.
>=900 and <2,500 3.8 160-0.0176H.
>= 2,500 and 4,000 3.8 116.
Ice-Making Head.................. Air...................... <700 9.24-0.0061H Not Applicable.
>=700 and <4,000 5.0 Not Applicable.
Remote Condensing (but Not Remote Air...................... <850 7.50-0.0034H Not Applicable.
Compressor). >=850 and <4,000 4.6 Not Applicable.
Remote Condensing and Remote Air...................... <850 7.65-0.0034H Not Applicable.
Compressor. >=850 and <4,000 4.8 Not Applicable.
Self-Contained................... Water.................... <900 7.28-0.0027H 153-0.0252H.
>=900 and <2,500 4.9 153-0.0252H.
>=2,500 and <4,000 4.9 90.
Self-Contained................... Air...................... <700 9.20--0.0050H Not Applicable.
>=700 and <4,000 5.7 Not Applicable.
--------------------------------------------------------------------------------------------------------------------------------------------------------
* H = rated harvest rate in pounds per 24 hours, indicating the water or energy use for a given rated harvest rate.
** Water use is for the condenser only and does not include potable water used to make ice.
Source: 42 U.S.C. 6313(d).
[FR Doc. 2014-05566 Filed 3-14-14; 8:45 am]
BILLING CODE 6450-01-P