Energy Conservation Program: Energy Conservation Standards for Consumer Clothes Dryers, 51734-51809 [2022-17900]

Download as PDF 51734 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules DEPARTMENT OF ENERGY 10 CFR Part 430 [EERE–2014–BT–STD–0058] RIN 1904–AD99 Energy Conservation Program: Energy Conservation Standards for Consumer Clothes Dryers Office of Energy Efficiency and Renewable Energy, Department of Energy. ACTION: Notice of proposed rulemaking and announcement of public meeting. AGENCY: The Energy Policy and Conservation Act, as amended (‘‘EPCA’’), prescribes energy conservation standards for various consumer products and certain commercial and industrial equipment, including consumer clothes dryers. EPCA also requires the U.S. Department of Energy (‘‘DOE’’) to periodically determine whether more stringent standards would be technologically feasible and economically justified, and would result in significant energy savings. In this notice of proposed rulemaking (‘‘NOPR’’), DOE proposes amended energy conservation standards for consumer clothes dryers, and also announces a public meeting to receive comment on these proposed standards and associated analyses and results. DATES: Meeting: DOE will hold a public meeting via webinar on September 13, 2022, from 1:00 p.m. to 4:00 p.m. See section VII, ‘‘Public Participation’’ for webinar registration information, participant instructions and information about the capabilities available to webinar participants. Comments: DOE will accept comments, data, and information regarding this NOPR no later than October 24, 2022. Comments regarding the likely competitive impact of the proposed standard should be sent to the Department of Justice contact listed in the ADDRESSES section on or before September 22, 2022. ADDRESSES: Interested persons are encouraged to submit comments using the Federal eRulemaking Portal at www.regulations.gov. Follow the instructions for submitting comments. Alternatively, interested persons may submit comments, identified by docket number EERE–2014–BT–STD–0058, by any of the following methods: 1. Federal eRulemaking Portal: www.regulations.gov. Follow the instructions for submitting comments. 2. Email: to ResClothesDryers2014STD0058@ lotter on DSK11XQN23PROD with PROPOSALS2 SUMMARY: VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 ee.doe.gov. Include docket number EERE–2014–BT–STD–0058 in the subject line of the message. No telefacsimiles (‘‘faxes’’) will be accepted. For detailed instructions on submitting comments and additional information on this process, see section IV of this document. Docket: The docket for this activity, which includes Federal Register notices, comments, and other supporting documents/materials, is available for review at www.regulations.gov. All documents in the docket are listed in the www.regulations.gov index. However, not all documents listed in the index may be publicly available, such as information that is exempt from public disclosure. The docket web page can be found at www.regulations.gov/docket/EERE2014-BT-STD-0058. The docket web page contains instructions on how to access all documents, including public comments, in the docket. See section VII for information on how to submit comments through www.regulations.gov. 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 following the instructions at www.RegInfo.gov. EPCA requires the Attorney General to provide DOE a written determination of whether the proposed standard is likely to lessen competition. The U.S. Department of Justice Antitrust Division invites input from market participants and other interested persons with views on the likely competitive impact of the proposed standard. Interested persons may contact the Division at energy.standards@usdoj.gov on or before the date specified in the DATES section. Please indicate in the ‘‘Subject’’ line of your email the title and Docket Number of this rulemaking notice. FOR FURTHER INFORMATION CONTACT: Mr. Bryan Berringer, U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Office, EE–5B, 1000 Independence Avenue SW, Washington, DC 20585–0121. Email: ApplianceStandardsQuestions@ ee.doe.gov. Ms. Kathryn McIntosh, U.S. Department of Energy, Office of the General Counsel, GC–33, 1000 Independence Avenue SW, Washington, DC 20585–0121. Telephone: (202) 586– 2002. Email: Kathryn.McIntosh@ hq.doe.gov. PO 00000 Frm 00002 Fmt 4701 Sfmt 4702 For further information on how to submit a comment, review other public comments and the docket, or participate in the public meeting, contact the Appliance and Equipment Standards Program staff at (202) 287–1445 or by email: ApplianceStandardsQuestions@ ee.doe.gov. SUPPLEMENTARY INFORMATION: Table of Contents I. Synopsis of the Proposed Rule A. Benefits and Costs to Consumers B. Impact on Manufacturers C. National Benefits and Costs D. Conclusion II. Introduction A. Authority B. Background 1. Current Standards 2. Current Process C. Deviation From Appendix A III. General Discussion A. Product Classes and Scope of Coverage B. Test Procedure C. Technological Feasibility 1. General 2. Maximum Technologically Feasible Levels D. Energy Savings 1. Determination of Savings 2. Significance of Savings E. Economic Justification 1. Specific Criteria a. Economic Impact on Manufacturers and Consumers b. Savings in Operating Costs Compared To Increase in Price (LCC and PBP) c. Energy Savings d. Lessening of Utility or Performance of Products e. Impact of Any Lessening of Competition f. Need for National Energy Conservation g. Other Factors 2. Rebuttable Presumption IV. Methodology and Discussion of Related Comments A. Market and Technology Assessment 1. Scope of Coverage and Product Classes 2. Technology Options B. Screening Analysis 1. Screened-Out Technologies a. Thermoelectric Heating, Electric Only b. Microwave, Electric Only c. Indirect Heating d. RF Drying, Electric Only e. Ultrasonic Drying, Electric Only 2. Remaining Technologies C. Engineering Analysis 1. Efficiency Analysis a. Baseline Efficiency Levels b. Incremental Efficiency Levels 2. Cost Analysis 3. Cost-Efficiency Results D. Markups Analysis E. Energy Use Analysis F. Life-Cycle Cost and Payback Period Analysis 1. Product Cost 2. Installation Cost 3. Annual Energy Consumption 4. Energy Prices 5. Maintenance and Repair Costs 6. Product Lifetime 7. Discount Rates E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules 8. Energy Efficiency Distribution in the NoNew-Standards Case 9. Payback Period Analysis G. Shipments Analysis H. National Impact Analysis 1. Product Efficiency Trends 2. National Energy Savings 3. Net Present Value Analysis I. Consumer Subgroup Analysis J. Manufacturer Impact Analysis 1. Overview 2. Government Regulatory Impact Model and Key Inputs a. Manufacturer Production Costs b. Shipments Projections c. Product and Capital Conversion Costs d. Manufacturer Markup Scenarios 3. Manufacturer Interviews a. Heat Pump Technology b. Preservation of Electromechanical Controls c. Cost Increases and Component Shortages 4. Discussion of MIA Comments K. Emissions Analysis 1. Air Quality Regulations Incorporated in DOE’s Analysis L. Monetizing Emissions Impacts M. Utility Impact Analysis N. Employment Impact Analysis V. Analytical Results and Conclusions A. Trial Standard Levels B. Economic Justification and Energy Savings 1. Economic Impacts on Individual Consumers a. Life-Cycle Cost and Payback Period b. Consumer Subgroup Analysis c. Rebuttable Presumption Payback 2. Economic Impacts on Manufacturers a. Industry Cash Flow Analysis Results b. Direct Impacts on Employment c. Impacts on Manufacturing Capacity d. Impacts on Subgroups of Manufacturers e. Cumulative Regulatory Burden 3. National Impact Analysis a. Significance of Energy Savings b. Net Present Value of Consumer Costs and Benefits c. Indirect Impacts on Employment 4. Impact on Utility or Performance of Products 5. Impact of Any Lessening of Competition 6. Need of the Nation To Conserve Energy 7. Other Factors 8. Summary of Economic Impacts C. Conclusion 1. Benefits and Burdens of TSLs Considered for Consumer Clothes Dryers Standards 2. Annualized Benefits and Costs of the Proposed Standards D. Reporting, Certification, and Sampling Plan VI. Procedural Issues and Regulatory Review A. Review Under Executive Orders 12866 and 13563 B. Review Under the Regulatory Flexibility Act 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. Information Quality VII. Public Participation A. Participation in the Webinar 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 VIII. Approval of the Office of the Secretary I. Synopsis of the Proposed Rule Title III, Part B 1 of EPCA,2 established the Energy Conservation Program for Consumer Products Other Than Automobiles. (42 U.S.C. 6291–6309) These products include consumer 51735 clothes dryers, the subject of this proposed rulemaking. Pursuant to EPCA, any new or amended energy conservation standard must be designed to achieve the maximum improvement in energy efficiency that DOE determines is technologically feasible and economically justified. (42 U.S.C. 6295(o)(2)(A)) Furthermore, the new or amended standard must result in a significant conservation of energy. (42 U.S.C. 6295(o)(3)(B)) EPCA also provides that not later than 6 years after issuance of any final rule establishing or amending a standard, DOE must publish either a notice of determination that standards for the product do not need to be amended, or a NOPR including new proposed energy conservation standards (proceeding to a final rule, as appropriate). (42 U.S.C. 6295(m)) In accordance with these and other statutory provisions discussed in this document, DOE proposes amended energy conservation standards for consumer clothes dryers. The proposed standards, which are expressed as the combined energy factor as determined in accordance with the appendix D2 test procedure (‘‘CEFD2’’) in pounds per kilowatt-hour (‘‘lb/kWh’’)—a metric based on the clothes dryer test load weight in pounds (‘‘lb’’) divided by the sum of ‘‘active mode’’ and ‘‘inactive mode’’ per-cycle energy use in kilowatthours (‘‘kWh’’), are shown in Table I.1. These proposed standards, if adopted, would apply to all consumer clothes dryers listed in Table I.1 manufactured in, or imported into, the United States starting on the date 3 years after the publication of the final rule for this proposed rulemaking. TABLE I.1—PROPOSED ENERGY CONSERVATION STANDARDS FOR CONSUMER CLOTHES DRYERS AS MEASURED UNDER APPENDIX D2 CEFD2 (lb/kWh) Product class lotter on DSK11XQN23PROD with PROPOSALS2 1. 2. 3. 4. 5. 6. 7. Electric, Standard (4.4 cubic feet (‘‘ft3’’) or greater capacity) ......................................................................................................... Electric, Compact (120 volts (‘‘V’’)) (less than 4.4 ft3 capacity) ..................................................................................................... Vented Electric, Compact (240V) (less than 4.4 ft3 capacity) ........................................................................................................ Vented Gas, Standard (4.4 ft3 or greater capacity) ........................................................................................................................ Vented Gas, Compact (less than 4.4 ft3 capacity) ......................................................................................................................... Ventless Electric, Compact (240V) (less than 4.4 ft3 capacity) ...................................................................................................... Ventless Electric, Combination Washer-Dryer ................................................................................................................................ 1 For editorial reasons, upon codification in the U.S. Code, Part B was redesignated Part A. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 2 All references to EPCA in this document refer to the statute as amended through the Infrastructure PO 00000 Frm 00003 Fmt 4701 Sfmt 4702 3.93 4.33 3.57 3.48 2.02 2.68 2.33 Investment and Jobs Act, Public Law 117–58 (Nov. 15, 2021). E:\FR\FM\23AUP2.SGM 23AUP2 51736 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules DOE also considered more-stringent energy efficiency levels as potential standards, and is still considering them in this proposed rulemaking. DOE may also consider adopting more stringentenergy efficiency levels for some or all classes. However, DOE has tentatively concluded at this time that the potential burdens of the more-stringent energy efficiency levels would outweigh the projected benefits. A. Benefits and Costs to Consumers Table I.2 presents DOE’s evaluation of the economic impacts of the proposed standards on consumers of consumer clothes dryers, as measured by the average life-cycle cost (‘‘LCC’’) savings and the simple payback period (‘‘PBP’’).3 The average LCC savings are positive for all product classes, and the PBP is less than the average lifetime of consumer clothes dryers, which is estimated to be 14 years (see section IV.F of this document). TABLE I.2—IMPACTS OF PROPOSED ENERGY CONSERVATION STANDARDS ON CONSUMERS OF CONSUMER CLOTHES DRYERS Average LCC savings (2020$) Consumer clothes dryer class Electric, Standard (4.4 ft3 or greater capacity) ................................................................................................ Electric, Compact (120V) (less than 4.4 ft3 capacity) ..................................................................................... Vented Electric, Compact (240V) (less than 4.4 ft3 capacity) ........................................................................ Vented Gas, Standard (4.4 ft3 or greater capacity) ........................................................................................ Vented Gas, Compact (less than 4.4 ft3 capacity) .......................................................................................... Ventless Electric, Compact (240V) (less than 4.4 ft3 capacity) ...................................................................... Ventless Electric, Combination Washer-Dryer ................................................................................................ are presented in section V.B.2 of this document. 0.55 1.81 1.62 1.95 5.07 0.33 0.00 The industry net present value (‘‘INPV’’) is the sum of the discounted cash flows to the industry from the base year through the end of the analysis period (2022–2056). Using a real discount rate of 7.5 percent, DOE estimates that the INPV for manufacturers of consumer clothes dryers in the case without amended standards is $1,810.1 million in 2020$. Under the proposed standards, the change in INPV is estimated to range from –6.4 percent to –4.5 percent, which is approximately $115.6 million to $81.6 million. In order to bring products into compliance with amended standards, it is estimated that the industry would incur total conversion costs of $149.7 million. DOE’s analysis of the impacts of the proposed standards on manufacturers is described in section IV.J of this document. The analytic results of the manufacturer impact analysis (‘‘MIA’’) DOE’s analyses indicate that the proposed energy conservation standards for consumer clothes dryers would save a significant amount of energy. Relative to the case without amended standards, the lifetime energy savings for consumer clothes dryers purchased in the 30-year period that begins in the anticipated year of compliance with the amended standards (2027–2056) amount to 3.11 quadrillion British thermal units (‘‘Btu’’), or quads.5 The cumulative net present value (‘‘NPV’’) of total consumer benefits of the proposed standards for consumer clothes dryers ranges from $9.07 billion (at a 7-percent discount rate) to $20.8 billion (at a 3-percent discount rate). This NPV expresses the estimated total value of future operating-cost savings minus the estimated increased product costs for consumer clothes dryers purchased in 2027–2056. In addition, the proposed standards for consumer clothes dryers are projected to yield significant environmental benefits. DOE estimates that the proposed standards would result in cumulative emission reductions (over the same period as for energy savings) of 116 million metric tons (‘‘Mt’’) 6 of carbon dioxide (‘‘CO2’’), 42.6 thousand tons of sulfur dioxide (‘‘SO2’’), 181 thousand tons of nitrogen oxides (‘‘NOX’’), 883 thousand tons of methane (‘‘CH4’’), 1.09 thousand tons of nitrous oxide (‘‘N2O’’), and 0.26 tons of mercury (‘‘Hg’’).7 DOE estimates the value of climate benefits from a reduction in greenhouse gases using four different estimates of the social cost of CO2 (‘‘SC–CO2’’), the social cost of methane (‘‘SC–CH4’’), and the social cost of nitrous oxide (‘‘SC– N2O’’). Together these represent the social cost of greenhouse gases (SC– GHG). DOE used interim SC–GHG values developed by an Interagency Working Group on the Social Cost of Greenhouse Gases (‘‘IWG’’).8 The derivation of these values is discussed in section IV.L of this document. For presentational purposes, the climate benefits associated with the average SC– GHG at a 3-percent discount rate are estimated to be $5.42 billion. DOE does not have a single central SC–GHG point estimate and it emphasizes the 3 The average LCC savings refer to consumers that are affected by a standard and are measured relative to the efficiency distribution in the no-newstandards case, which depicts the market in the compliance year in the absence of new or amended standards (see section IV.F.8 of this document). The simple PBP, which is designed to compare specific efficiency levels, is measured relative to the baseline product (see section IV.F.9 of this document). 4 All monetary values in this document are expressed in 2020 dollars. 5 The quantity refers to full-fuel-cycle (‘‘FFC’’) energy savings. FFC energy savings includes the energy consumed in extracting, processing, and transporting primary fuels (i.e., coal, natural gas, petroleum fuels), and, thus, presents a more complete picture of the impacts of energy efficiency standards. For more information on the FFC metric, see section IV.H.2 of this document. 6 A metric ton is equivalent to 1.1 short tons. Results for emissions other than CO2 are presented in short tons. 7 DOE calculated emissions reductions relative to the no-new-standards case, which reflects key assumptions in the Annual Energy Outlook 2021 (‘‘AEO2021’’). AEO2021 represents current Federal and State legislation and final implementation of regulations as of the time of its preparation. See section IV.K of this document for further discussion of AEO2021 assumptions that effect air pollutant emissions. 8 See Interagency Working Group on Social Cost of Greenhouse Gases, Technical Support Document: Social Cost of Carbon, Methane, and Nitrous Oxide. Interim Estimates Under Executive Order 13990, Washington, DC (February 2021) (Available at: www.whitehouse.gov/wp-content/uploads/2021/02/ TechnicalSupportDocument_ SocialCostofCarbonMethaneNitrousOxide.pdf) (Last accessed March 17, 2022). DOE’s analysis of the impacts of the proposed standards on consumers is described in section IV.F of this document. C. National Benefits and Costs 4 B. Impact on Manufacturers lotter on DSK11XQN23PROD with PROPOSALS2 $578 160 192 198 25.2 145 15.1 Simple payback period (years) VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00004 Fmt 4701 Sfmt 4702 E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules importance and value of considering the benefits calculated using all four SC– GHG estimates.9 DOE also estimates health benefits from SO2 and NOX emissions reductions. DOE estimates the present value of the health benefits would be $3.59 billion using a 7-percent discount rate, and $9.14 billion using a 3-percent discount rate. DOE is currently only monetizing (for SO2 and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM2.5 emissions. Table I.3 summarizes the monetized benefits and costs expected to result from the proposed standards for 51737 consumer clothes dryers. There are other important unquantified effects, including certain unquantified climate benefits, unquantified public health benefits from the reduction of toxic air pollutants and other emissions, unquantified energy security benefits, and distributional effects, among others. TABLE I.3—SUMMARY OF MONETIZED ECONOMIC BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR CONSUMER CLOTHES DRYERS [TSL 3] Billion 2020$ 3% discount rate Consumer Operating Cost Savings ................................................................................................................................................. Climate Benefits * ............................................................................................................................................................................. Health Benefits ** ............................................................................................................................................................................. Total Benefits † ................................................................................................................................................................................ Consumer Incremental Product Costs ‡ .......................................................................................................................................... Net Benefits ..................................................................................................................................................................................... 22.2 5.42 9.14 36.8 1.36 35.4 7% discount rate Consumer Operating Cost Savings ................................................................................................................................................. Climate Benefits * ............................................................................................................................................................................. Health Benefits ** ............................................................................................................................................................................. Total Benefits † ................................................................................................................................................................................ Consumer Incremental Product Costs ‡ .......................................................................................................................................... Net Benefits ..................................................................................................................................................................................... 9.83 5.42 3.59 18.8 0.76 18.1 lotter on DSK11XQN23PROD with PROPOSALS2 Note: This table presents the costs and benefits associated with consumer clothes dryers shipped in 2027–2056. These results include benefits to consumers which accrue after 2056 from the products shipped in 2027–2056. * Climate benefits are calculated using four different estimates of the social cost of carbon (SC–CO2), methane (SC–CH4), and nitrous oxide (SC–N2O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates; 95th percentile at 3 percent discount rate), as shown in Table V.36, Table V.38, and Table V.40. Together these represent the global social cost of greenhouse gases (SC–GHG). For presentational purposes of this table, the climate benefits associated with the average SC–GHG at a 3 percent discount rate are shown, but the Department does not have a single central SC–GHG point estimate. See section. IV.L of this document for more details. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22–30087) granted the Federal government’s emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued in Louisiana v. Biden, No. 21–cv–1074–JDC–KK (W.D. La.). As a result of the Fifth Circuit’s order, the preliminary injunction is no longer in effect, pending resolution of the Federal government’s appeal of that injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in that case from ‘‘adopting, employing, treating as binding, or relying upon’’ the interim estimates of the social cost of greenhouse gases—which were issued by the Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 2021—to monetize the benefits of reducing greenhouse gas emissions. As reflected in this rule, DOE has reverted to its approach prior to the injunction and presents monetized greenhouse gas abatement benefits where appropriate and permissible under law. ** Health benefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only monetizing (for SO2 and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits, but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM2.5 emissions. The health benefits are presented at real discount rates of 3 and 7 percent. See section IV.L of this document for more details. † Total and net benefits include those consumer, climate, and health benefits that can be monetized. For presentation purposes, total and net benefits for both the 3-percent and 7-percent cases are presented using the average SC–GHG with 3-percent discount rate, but the Department does not have a single central SC–GHG point estimate. DOE emphasizes the importance and value of considering the benefits calculated using all four SC–GHG estimates. See Table V.46 for net benefits using all four SC–GHG estimates. ‡ Costs include incremental equipment costs as well as installation costs. The benefits and costs of the proposed standards, for consumer clothes dryers sold in 2027–2056, can also be expressed in terms of annualized values. The monetary values for the total annualized net benefits are (1) the reduced consumer operating costs, minus (2) the increase in product purchase prices and installation costs, plus (3) the value of the benefits of NOX and SO2 emission reductions, all annualized.10 9 On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22–30087) granted the Federal government’s emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued in Louisiana v. Biden, No. 21–cv– 1074–JDC–KK (W.D. La.). As a result of the Fifth Circuit’s order, the preliminary injunction is no longer in effect, pending resolution of the Federal government’s appeal of that injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in that case from ‘‘adopting, employing, treating as binding, or relying upon’’ the interim estimates of the social cost of greenhouse gases—which were issued by the Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 2021—to monetize the benefits of reducing greenhouse gas emissions. As reflected in this rule, DOE has reverted to its approach prior to the injunction and presents monetized greenhouse gas abatement benefits where appropriate and permissible under law. 10 To convert the time-series of costs and benefits into annualized values, DOE calculated a present value in 2021, the year used for discounting the NPV of total consumer costs and savings. For the benefits, DOE calculated a present value associated with each year’s shipments in the year in which the shipments occur (e.g., 2030), and then discounted the present value from each year to 2021. The calculation uses discount rates of 3 and 7 percent for all costs and benefits. Using the present value, DOE then calculated the fixed annual payment over a 30-year period, starting in the compliance year, that yields the same present value. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00005 Fmt 4701 Sfmt 4702 E:\FR\FM\23AUP2.SGM 23AUP2 51738 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules The national operating savings are domestic private U.S. consumer monetary savings that occur as a result of purchasing the covered products and are measured for the lifetime of consumer clothes dryers shipped in 2027–2056. The benefits associated with reduced emissions achieved as a result of the proposed standards are also calculated based on the lifetime of consumer clothes dryers shipped in 2027–2056. Total benefits for both the 3percent and 7-percent cases are presented using the average GHG social costs with 3-percent discount rate. Estimates of SC–GHG values are presented for all four discount rates in section V.B.8 of this document. Estimates of annualized benefits and costs of the proposed standards are shown in Table I.4. The results under the primary estimate are as follows. Using a 7-percent discount rate for consumer benefits and costs and health benefits from reduced SO2 and NOX emissions, the estimated cost of the standards proposed in this rule is $85.7 million per year in increased equipment costs, while the estimated annual benefits are $1,111 million in reduced equipment operating costs, $320 million in climate benefits, and $406 million in health benefits (accounting for reduced NOX emissions and increased SO2 emissions). In this case, the net benefit would amount to $1,752 million per year. Using a 3-percent discount rate for all benefits and costs, the estimated cost of the proposed standards is $80.7 million per year in increased equipment costs, while the estimated annual benefits are $1,313 million in reduced operating costs, $320 million in climate benefits, and $541 million in health benefits (accounting for reduced NOX emissions and increased SO2 emissions). In this case, the net benefit would amount to $2,094 million per year. TABLE I.4—ANNUALIZED MONETIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR CONSUMER CLOTHES DRYERS [TSL 3] Million 2020$/year Primary estimate Low-netbenefits estimate High-netbenefits estimate 3% discount rate Consumer Operating Cost Savings ............................................................................................. Climate Benefits * ......................................................................................................................... Health Benefits ** ......................................................................................................................... Total Benefits † ............................................................................................................................ Consumer Incremental Product Costs ‡ ...................................................................................... Net Benefits ................................................................................................................................. 1,313 320 541 2,174 80.7 2,094 1,227 311 526 2,065 80.5 1,984 1,403 327 551 2,280 76.6 2,204 1,111 320 406 1,837 85.7 1,752 1,050 311 395 1,757 85.3 1,671 1,178 327 413 1,917 82.4 1,835 7% discount rate Consumer Operating Cost Savings ............................................................................................. Climate Benefits * ......................................................................................................................... Health Benefits ** ......................................................................................................................... Total Benefits † ............................................................................................................................ Consumer Incremental Product Costs ‡ ...................................................................................... Net Benefits ................................................................................................................................. lotter on DSK11XQN23PROD with PROPOSALS2 Note: This table presents the costs and benefits associated with consumer clothes dryers shipped in 2027–2056. These results include benefits to consumers which accrue after 2056 from the products shipped in 2027–2056. * Climate benefits are calculated using four different estimates of the global SC–GHG (see section IV.L of this document). For presentational purposes of this table, the climate benefits associated with the average SC–GHG at a 3 percent discount rate are shown, but the Department does not have a single central SC–GHG point estimate, and it emphasizes the importance and value of considering the benefits calculated using all four SC–GHG estimates. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22–30087) granted the federal government’s emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued in Louisiana v. Biden, No. 21–cv–1074–JDC–KK (W.D. La.). As a result of the Fifth Circuit’s order, the preliminary injunction is no longer in effect, pending resolution of the federal government’s appeal of that injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in that case from ‘‘adopting, employing, treating as binding, or relying upon’’ the interim estimates of the social cost of greenhouse gases—which were issued by the Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 2021—to monetize the benefits of reducing greenhouse gas emissions. As reflected in this rule, DOE has reverted to its approach prior to the injunction and presents monetized greenhouse gas abatement benefits where appropriate and permissible under law. ** Health benefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only monetizing (for SO2 and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits, but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM2.5 emissions. The health benefits are presented at real discount rates of 3 and 7 percent. See section IV.L of this document for more details. † Total benefits for both the 3-percent and 7-percent cases are presented using the average SC–GHG with 3-percent discount rate, but the Department does not have a single central SC–GHG point estimate. DOE emphasizes the importance and value of considering the benefits calculated using all four SC–GHG estimates. ‡ Costs include incremental equipment costs as well as installation costs. DOE’s analysis of the national impacts of the proposed standards is described in sections IV.H, IV.K and IV.L of this document. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 D. Conclusion DOE has tentatively concluded that the proposed standards represent the maximum improvement in energy efficiency that is technologically feasible and economically justified, and PO 00000 Frm 00006 Fmt 4701 Sfmt 4702 would result in the significant conservation of energy. Specifically, with regards to technological feasibility, products achieving these standard levels are already commercially available for all product classes covered by this proposal. As for economic justification, E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules lotter on DSK11XQN23PROD with PROPOSALS2 DOE’s analysis shows that the benefits of the proposed standard exceed, to a great extent, the burdens of the proposed standards. Using a 7-percent discount rate for consumer benefits and costs and NOX and SO2 reduction benefits, the estimated cost of the proposed standards for consumer clothes dryers is $85.7 million per year in increased product costs, while the estimated annual benefits are $1,111 million in reduced product operating costs, and $406 million in health benefits. The net benefit amounts to $1,752 million per year. The significance of energy savings offered by a new or amended energy conservation standard cannot be determined without knowledge of the specific circumstances surrounding a given rulemaking.11 For example, some covered products and equipment have substantial energy consumption occur during periods of peak energy demand. The impacts of these products on the energy infrastructure can be more pronounced than products with relatively constant demand. In evaluating the significance of energy savings, DOE considers differences in primary energy and FFC effects for different covered products and equipment when determining whether energy savings are significant. Primary energy and FFC effects include the energy consumed in electricity production (depending on load shape), in distribution and transmission, and in extracting, processing, and transporting primary fuels (i.e., coal, natural gas, petroleum fuels), and thus present a more complete picture of the impacts of energy conservation standards. Accordingly, DOE evaluates the significance of energy savings on a caseby-case basis. As previously mentioned, the standards are projected to result in estimated national energy savings of 3.11 quads, the equivalent of the electricity consumption of 78 million residential homes in one year.12 DOE has initially determined the energy savings from the proposed standard levels are ‘‘significant’’ within the meaning of 42 U.S.C. 6295(o)(3)(B). A more detailed discussion of the basis for these tentative conclusions is contained in the remainder of this document and 11 Procedures, Interpretations, and Policies for Consideration in New or Revised Energy Conservation Standards and Test Procedures for Consumer Products and Commercial/Industrial Equipment, 86 FR 70892, 70901 (Dec. 13, 2021). 12 U.S. Environmental Protection Agency, Greenhouse Gas Equivalencies Calculator. Available at www.epa.gov/energy/greenhouse-gasequivalencies-calculator. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 the accompanying technical support document (‘‘TSD’’). DOE also considered more-stringent energy efficiency levels as potential standards, and is still considering them in this proposed rulemaking. However, DOE has tentatively concluded that the potential burdens of the more-stringent energy efficiency levels would outweigh the projected benefits. Based on consideration of the public comments DOE receives in response to this document and related information collected and analyzed during the course of this rulemaking effort, DOE may adopt energy efficiency levels presented in this document 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 proposed rule, as well as some of the relevant historical background related to the establishment of standards for consumer clothes dryers. A. Authority EPCA authorizes DOE to regulate the energy efficiency of a number of consumer products and certain industrial equipment. Title III, Part B of EPCA established the Energy Conservation Program for Consumer Products Other Than Automobiles. These products include consumer clothes dryers, the subject of this document. (42 U.S.C. 6292(a)(8)) EPCA prescribed energy conservation standards for these products (42 U.S.C. 6295(g)(3)), and directs DOE to conduct future rulemakings to determine whether to amend these standards. (42 U.S.C. 6295(g)(4)) EPCA further provides that, not later than 6 years after the issuance of any final rule establishing or amending a standard, DOE must publish either a notice of determination that standards for the product do not need to be amended, or a NOPR including new proposed energy conservation standards (proceeding to a final rule, as appropriate). (42 U.S.C. 6295(m)(1)). The energy conservation program under EPCA consists essentially of four parts: (1) testing, (2) labeling, (3) the establishment of Federal energy conservation standards, and (4) certification and enforcement procedures. Relevant provisions of EPCA specifically include definitions (42 U.S.C. 6291), test procedures (42 U.S.C. 6293), labeling provisions (42 U.S.C. 6294), energy conservation PO 00000 Frm 00007 Fmt 4701 Sfmt 4702 51739 standards (42 U.S.C. 6295), and the authority to require information and reports from manufacturers (42 U.S.C. 6296). Federal energy efficiency requirements for covered products established under EPCA generally supersede State laws and regulations concerning energy conservation testing, labeling, and standards. (42 U.S.C. 6297(a)–(c)) 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 EPCA. (See 42 U.S.C. 6297(d)). 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 covered product. (42 U.S.C. 6295(o)(3)(A) and 42 U.S.C. 6295(r)) Manufacturers of covered products must use the prescribed DOE test procedure as the basis for certifying to DOE that their products comply with the applicable energy conservation standards adopted under EPCA and when making representations to the public regarding the energy use or efficiency of those products. (42 U.S.C. 6293(c) and 42 U.S.C. 6295(s)) Similarly, DOE must use these test procedures to determine whether the products comply with standards adopted pursuant to EPCA. (42 U.S.C. 6295(s)) The DOE test procedures for consumer clothes dryers appear at title 10 of the Code of Federal Regulations (‘‘CFR’’) part 430, subpart B, appendix D1 and appendix D2 (‘‘appendix D1’’ and ‘‘appendix D2’’, respectively). DOE must follow specific statutory criteria for prescribing new or amended standards for covered products, including consumer clothes dryers. Any new or amended standard for a covered product must be designed to achieve the maximum improvement in energy efficiency that the Secretary of Energy determines is technologically feasible and economically justified. (42 U.S.C. 6295(o)(2)(A) and 42 U.S.C. 6295(o)(3)(B)) Furthermore, DOE may not adopt any standard that would not result in the significant conservation of energy. (42 U.S.C. 6295(o)(3) (B)) Moreover, DOE may not prescribe a standard if DOE determines by rule that the standard is not technologically feasible or economically justified. (42 U.S.C. 6295(o)(3)(B)) 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)) DOE must make this determination after receiving comments E:\FR\FM\23AUP2.SGM 23AUP2 51740 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules on the proposed standard, and by considering, to the greatest extent practicable, the following seven statutory factors: (1) The economic impact of the standard on manufacturers and consumers of the products subject to the standard; (2) The savings in operating costs throughout the estimated average life of the covered products in the type (or class) compared to any increase in the price, initial charges, or maintenance expenses for the covered products that are likely to result from the standard; (3) The total projected amount of energy (or as applicable, water) savings likely to result directly from the standard; (4) Any lessening of the utility or the performance of the covered products likely to result from the standard; (5) The impact of any lessening of competition, as determined in writing by the Attorney General, that is likely to result from the standard; (6) The need for national energy and water conservation; and (7) Other factors the Secretary of Energy (‘‘Secretary’’) considers relevant. lotter on DSK11XQN23PROD with PROPOSALS2 (42 U.S.C. 6295(o)(2)(B)(i)(I)–(VII)) Further, EPCA establishes a rebuttable presumption that a standard is economically justified if the Secretary finds that the additional cost to the consumer of purchasing a product complying with an energy conservation standard level will be less than three times the value of the energy savings during the first year that the consumer will receive as a result of the standard, as calculated under the applicable test procedure. (42 U.S.C. 6295(o)(2)(B)(iii)) EPCA also contains what is known as an ‘‘anti-backsliding’’ provision, which prevents the Secretary from prescribing any amended standard that either increases the maximum allowable energy use or decreases the minimum required energy efficiency of a covered product. (42 U.S.C. 6295(o)(1)) Also, the Secretary may not prescribe an amended or new standard if interested persons have established by a preponderance of the evidence that the standard is likely to result in the unavailability in the United States in any covered product type (or class) of performance characteristics (including reliability), features, sizes, capacities, and volumes that are substantially the same as those VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 generally available in the United States. (42 U.S.C. 6295(o)(4)) Additionally, EPCA specifies requirements when promulgating an energy conservation standard for a covered product that has two or more product classes. DOE must specify a different standard level for a type or class of product 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 products within such type (or class); or (B) have a capacity or other performance-related feature which other products within such type (or class) do not have and such feature justifies a higher or lower standard. (42 U.S.C. 6295(q)(1)) In determining whether a performance-related feature justifies a different standard for a group of products, 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)) Finally, pursuant to the amendments contained in the Energy Independence and Security Act of 2007 (‘‘EISA 2007’’), Public Law 110–140, any final rule for new or amended energy conservation standards promulgated after July 1, 2010, is required to address standby mode and off mode energy use. (42 U.S.C. 6295(gg)(3)) Specifically, when DOE adopts a standard for a covered product after that date, it must, if justified by the criteria for adoption of standards under EPCA (42 U.S.C. 6295(o)), incorporate standby mode and off mode energy use into a single standard, or, if that is not feasible, adopt a separate standard for such energy use for that product. (42 U.S.C. 6295(gg)(3)(A)–(B)) DOE’s current test procedures for consumer clothes dryers address standby mode and off mode energy use. In this rulemaking, DOE intends to incorporate such energy use into any amended energy conservation standards that it may adopt. PO 00000 Frm 00008 Fmt 4701 Sfmt 4702 B. Background 1. Current Standards The most recent standards rulemaking for consumer clothes dryers was promulgated on April 21, 2011. Specifically, DOE published a direct final rule (the ‘‘2011 Direct Final Rule’’) amending the energy conservation standard for consumer clothes dryers manufactured on and after January 1, 2015. 76 FR 22454 (Apr. 21, 2011). The energy conservation standards, as amended in the 2011 Direct Final Rule, represent the current standards and are in accordance with the appendix D1 test procedure as discussed in section III.B of this document. They are based on combined energy factor (‘‘CEF’’)—a metric that incorporates energy use in active mode, standby mode, and off mode. Compliance with the current standards was required as of January 1, 2015. 76 FR 52852 (Aug. 24, 2011). Even though DOE maintained the same energy-efficiency descriptor for both appendix D1 and appendix D2, DOE notes that the CEF values are not equivalent because of the extensive differences in test methods. To avoid potential confusion that would result from using the same efficiency descriptor for both test procedures as it relates to the standards discussed in this document, DOE is including a ‘‘D1’’ or ‘‘D2’’ subscript when referring to the appendix D1 CEF and appendix D2 CEF, respectively (i.e., CEFD1 and CEFD2), in this document.13 These current consumer clothes dryer standards as measured under appendix D1 are set forth in DOE’s regulations at 10 CFR 430.32(h) and are repeated in Table II.1. DOE has conducted the rulemaking analysis for this proposed rule under the appendix D2 test procedure because compliance will be required concurrent with amended energy conservation, if finalized. DOE discusses additional details about the engineering baseline in section IV.C.1 of this document. 13 Note that while the current standards are based on CEF as determined in accordance with appendix D1, manufacturers are permitted to use the appendix D2 test procedure to comply with the current standards, as long as they use a single appendix for all representations. E:\FR\FM\23AUP2.SGM 23AUP2 51741 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules TABLE II.1—FEDERAL ENERGY CONSERVATION STANDARDS FOR CONSUMER CLOTHES DRYERS AS MEASURED UNDER APPENDIX D1 CEFD1 (lbs/kWh) Product class (A) Vented Electric, Standard (4.4 ft 3 or greater capacity) ................................................................................................................ (B) Vented Electric, Compact (120V) (less than 4.4 ft 3 capacity) ...................................................................................................... (C) Vented Electric, Compact (240V) (less than 4.4 ft 3 capacity) ...................................................................................................... (D) Vented Gas .................................................................................................................................................................................... (E) Ventless Electric, Compact (240V) (less than 4.4 ft 3 capacity) ................................................................................................... (F) Ventless Electric, Combination Washer-Dryer .............................................................................................................................. On December 16, 2020, DOE published a final rule establishing a separate product class for consumer clothes dryers that offer cycle times for a ‘‘normal’’ cycle 14 of less than 30 minutes. 85 FR 81359 (Dec. 16, 2020) (‘‘December 2020 Final Rule’’). Because no such ‘‘short-cycle’’ consumer clothes dryers are currently on the market in the United States, DOE did not include analysis of this newly established product class in the preliminary TSD. While these short-cycle products had previously been subject to energy and water conservation standards, the December 2020 Final Rule stated that short-cycle product classes were no longer subject to any water or energy conservation standards. 85 FR 68723, 68742; 85 FR 81359, 81376. As a result, the short-cycle products were allowed to consume unlimited amounts of energy and water. As discussed in a NOPR subsequently published on August 11, 2021, DOE noted that in amending the standards for short-cycle products to allow for unlimited water and energy usage, DOE failed to consider whether the amended standards met the criteria in EPCA for issuing an amended standard. Notably, among other things, DOE did not determine, as required, that the amended standards for short-cycle products were designed to achieve the maximum improvement in energy efficiency that is technologically feasible and economically justified. (42 U.S.C. 6295(o)(2)(A)) 86 FR 43970, 43971. DOE has since published a final rule on January 19, 2022, which revoked the December 2020 Final Rule that improperly promulgated standards for this new product class and reinstated the prior product classes and applicable standards for these covered products. 87 FR 2673, 2686. Therefore, DOE did not include analysis of a short-cycle product class in the NOPR TSD. 2. Current Process DOE published a request for information (‘‘RFI’’) on March 27, 2015 (the ‘‘March 2015 RFI’’) describing the approaches and methods DOE will use in evaluating potential amended standards for consumer clothes dryers. 80 FR 16309 (Mar. 27, 2015). In addition, the RFI solicited information from the public to help DOE determine 3.73 3.61 3.27 3.30 2.55 2.08 whether amended standards for consumer clothes dryers would result in a significant amount of additional energy savings, and whether those standards would be technologically feasible and economically justified. Id. The March 2015 RFI is available at www.regulations.gov/document/EERE2014-BT-STD-0058-0001. DOE published a notice of public webinar and availability of the preliminary TSD on April 19, 2021 (‘‘April 2021 Preliminary Analysis’’) to collect data and information to inform its decision consistent with its obligations under EPCA. 86 FR 20327. DOE subsequently held a public webinar on May 26, 2021, to discuss and receive comments on the preliminary TSD. The preliminary TSD that presented the methodology and results of the preliminary analysis is available at: www.regulations.gov/ document/EERE-2014-BT-STD-00580020. DOE received comments in response to the April 2021 Preliminary Analysis from the interested parties listed in Table II.2. lotter on DSK11XQN23PROD with PROPOSALS2 TABLE II.2—APRIL 2021 PRELIMINARY ANALYSIS WRITTEN COMMENTS Commenter(s) Abbreviation Commenter type Association of Home Appliance Manufacturers ...................... Appliance Standards Awareness Project, Natural Resources Defense Council. California Investor-Owned Utilities .......................................... GE Appliances, a Haier Company .......................................... Whirlpool Corporation ............................................................. Samsung Electronics America ................................................ Northwest Energy Efficiency Alliance ..................................... Institute for Policy Integrity at NYU School of Law ................ AHAM .................................................... ASAP, NRDC ......................................... Trade Association. Efficiency Organizations. California IOUs ...................................... GEA ....................................................... Whirlpool ................................................ Samsung ................................................ NEEA ..................................................... IPI .......................................................... Utilities. Manufacturer. Manufacturer. Manufacturer. Efficiency Organization. Efficiency Organization. A parenthetical reference at the end of a comment quotation or paraphrase provides the location of the item in the public record.15 In response to the preliminary analysis, AHAM and Whirlpool stated that as laundry products are designed and used in pairs, DOE should harmonize its rulemaking processes such that the compliance dates for residential clothes washers and consumer clothes dryers are, if not identical, very close in time. According to AHAM and Whirlpool, this would 14 Section 3.3.2 of appendix D2 requires that the ‘‘normal’’ program shall be selected for the test cycle; for clothes dryers that do not have a ‘‘normal’’ program, the cycle recommended by the manufacturer for drying cotton or linen clothes shall be selected. 15 The parenthetical reference provides a reference for information located in the docket of DOE’s rulemaking to develop energy conservation standards for consumer clothes dryers. (Docket No. EERE–2014–BT–STD–0058, which is maintained at www.regulations.gov). The references are arranged as follows: (commenter name, comment docket ID number, page of that document). VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00009 Fmt 4701 Sfmt 4702 E:\FR\FM\23AUP2.SGM 23AUP2 51742 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules lotter on DSK11XQN23PROD with PROPOSALS2 greatly reduce burden on manufacturers as they work to design products to meet amended standards as well as on retailers and consumers as products are re-floored leading up to and on the compliance date of any amended energy conservation standards. (AHAM, No. 23 at p. 6; Whirlpool, No. 27 at p. 13) DOE appreciates the comments from AHAM and Whirlpool and recognizes the benefits of aligning the schedule for future amended standards for both products and may investigate harmonization of future rulemaking processes. Additionally, AHAM stated its strong opposition to Natural Resources Canada’s (‘‘NRCan’’) proposal to make ENERGY STAR levels the minimum energy conservation standard for clothes dryers in Canada and strongly urged DOE to not only weigh in against NRCan’s approach through the U.S.Canada Regulatory Cooperation Council and under the recently signed Memorandum of Understanding on energy cooperation, but also to account for the burden of any misalignment in DOE’s analysis. According to AHAM it is critical that amended standards are coordinated in both substance and timing in order to maintain a consistent U.S.-Canadian market for home appliances. (AHAM, No. 23 at p. 9) DOE notes that review of efficiency standards efforts in other regions is discussed in chapter 3 of the NOPR TSD. DOE will continue to review and track these efforts as part of its analysis. C. Deviation From Appendix A Section 3(a) of 10 CFR part 430, subpart C, appendix A (‘‘appendix A’’) specifies that, in those instances where the Department may find it necessary or appropriate to deviate from the procedures, interpretations or policies that are generally applicable to the development of energy conservation standards and test procedures, DOE will provide interested parties with notice of the deviation and an explanation. DOE finds that it is appropriate to deviate from its existing procedures by publishing this NOPR instead of releasing an additional framework document because such activity would be redundant due to the information previously obtained through the March 2015 RFI and the preliminary analysis. Additionally, DOE finds it necessary to deviate from its existing procedures by providing a 60-day comment period for this NOPR because interested parties received sufficient time to comment on earlier rulemaking documents that relied on many of the same analytical assumptions and approaches presented in this proposal. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 In accordance with section 3(a) of appendix A, DOE notes that it is deviating from the provision in appendix A regarding the pre-NOPR stages for an energy conservation standards rulemaking. Section 6(a)(2) of appendix A states that if the Department determines it is appropriate to proceed with a rulemaking, the preliminary stages of a rulemaking to issue or amend an energy conservation standard that DOE will undertake will be a framework document and preliminary analysis, or an advance notice of proposed rulemaking. DOE is opting to deviate from this step by publishing a NOPR following the preliminary analysis without a framework document. A framework document is intended to introduce and summarize the various analyses DOE conducts during the rulemaking process and requests initial feedback from interested parties. As discussed, prior to the preliminary analysis and this NOPR, DOE published the March 2015 RFI, in which DOE identified and sought comment on the technical and economic analyses to be conducted in determining whether amended energy conservation standards would be justified. See 80 FR 16309. DOE provided a 45-day comment period for the RFI. Id. Comments received following publication of the March 2015 RFI assisted DOE in identifying and resolving issues related to the preliminary analyses. 86 FR 20327, 20330. Given the level of comments received to the March 2015 RFI, publication of a framework document would be largely redundant with the published RFI and preliminary analysis. As such, DOE is deviating from the procedures provided in appendix A and is not publishing a framework document prior to the publication of this NOPR. The Department has determined that it is appropriate to proceed with this proposal due to the information obtained through the March 2015 RFI and the preliminary analysis. Section 6(f)(2) of appendix A specifies that the length of the public comment period for a NOPR will vary depending upon the circumstances of the particular rulemaking, but will not be less than 75 calendar days. For this NOPR, DOE has opted to instead provide a 60-day comment period. As stated previously DOE requested comment in the March 2015 RFI on the technical and economic analyses and provided stakeholders a 45-day comment period. Additionally, DOE provided a 75-day comment period for the preliminary analysis. 86 FR 20327. DOE has relied on many of the same analytical assumptions and approaches as used in the preliminary PO 00000 Frm 00010 Fmt 4701 Sfmt 4702 assessment and has determined that a 60-day comment period in conjunction with the prior comment periods provides sufficient time for interested parties to review the proposed rule and develop comments. As such, DOE has determined that a 75-comment period is not necessary for this proposal and that a 60-day comment period is sufficient time for interested stakeholders to submit their comments on this document. III. General Discussion DOE developed this proposal after considering oral and written comments, data, and information from interested parties that represent a variety of interests. The following discussion addresses issues raised by these commenters. A. Product Classes and Scope of Coverage When evaluating and establishing energy conservation standards, DOE divides covered products into product classes by the type of energy used or by capacity or other performance-related features that justify differing standards. In determining whether a performancerelated feature justifies a different standard, DOE must consider such factors as the utility of the feature to the consumer and other factors DOE determines are appropriate. (42 U.S.C. 6295(q)) DOE’s review of the preliminary analysis and comments received in response to the preliminary analysis, in addition to results from an updated test sample, are discussed in more detail in section IV.A of this document. B. Test Procedure EPCA sets forth generally applicable criteria and procedures for DOE’s adoption and amendment of test procedures. (42 U.S.C. 6293) Manufacturers of covered products must use these test procedures to certify to DOE that their product complies with energy conservation standards and to quantify the efficiency of their product. On October 8, 2021, DOE published a final rule for the test procedure rulemaking (86 FR 56608) (the ‘‘October 2021 TP Final Rule’’), in which it amended appendix D1 and appendix D2, both entitled ‘‘Uniform Test Method for Measuring the Energy Consumption of Clothes Dryers,’’ to provide additional detail in response to questions from manufacturers and test laboratories, including additional detail regarding the testing of ‘‘connected’’ models, dryness level selection, and the procedures for maintaining the required heat input rate for gas clothes dryers; E:\FR\FM\23AUP2.SGM 23AUP2 lotter on DSK11XQN23PROD with PROPOSALS2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules additional detail for the test procedures for performing inactive and off mode power measurements; specifications for the final moisture content (‘‘FMC’’) required for testing automatic termination control dryers; specification of a narrower scale resolution for the weighing scale used to determine moisture content of test loads; and specification that the test load must be weighed within 5 minutes after a test cycle has terminated. In addition, DOE amended the test procedures to update the estimated number of annual use cycles for clothes dryers; provide further direction for additional provisions within the test procedures; specify rounding requirements for all reported values; apply consistent use of nomenclature and correct typographical errors; remove obsolete sections of the test procedures, including appendix D; and update the reference to the applicable industry test procedure to the version certified by the American National Standards Institute (‘‘ANSI’’). 86 FR 56608, 56610 DOE’s current energy conservation standards for consumer clothes dryers are expressed in terms of CEFD1. (See 10 CFR 430.32(h)(3).) In response to the preliminary analysis, commenters requested that DOE finalize the test procedure rulemaking prior to proceeding with energy conservation standards rulemaking in order to capture any impacts a finalized test procedure would have on amended standards. (AHAM, No. 22 at pp. 7–8; AHAM, No. 23 at pp. 2–4; California IOUs, No. 26 at pp. 4–5; GEA, No. 28 at p. 2; NEEA, No. 30 at p. 8). At the time of the publication of the preliminary analysis, the October 2021 TP Final Rule had not yet published; however, DOE noted in the October 2021 TP Final Rule that the amendments adopted, other than the amendment to the number of annual use cycles in appendix D2, would not substantively alter the measured efficiency of consumer clothes dryers, and that the test procedures would not be unduly burdensome to conduct. The amendment to the number of annual use cycles specified for calculating per-cycle standby mode and off mode energy consumption would alter the measured energy efficiency of consumer clothes dryers when using appendix D2, but use of the amended value in appendix D2 is not required until such time as DOE were to amend the energy conservations standards accounting for such changes in the test procedure, should such amended energy conservation standards be adopted. 86 FR 56608, 56611. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 GEA, AHAM, and Samsung requested that DOE review the FMC requirement according to appendix D2, stating that the current 2-percent FMC requirement is too strict and not representative of consumer preference. (GEA, No. 22 at pp. 42–44; AHAM, No. 23 at p. 4; Samsung, No. 29 at pp. 2–3) AHAM questioned the degree of savings that can be achieved through more stringent standards, stating that the energy conservation standards would have less of an impact on consumer clothes dryer energy use than the FMC itself. As stated in the October 2021 TP Final Rule, the current 2-percent FMC requirement using the DOE test cloth was adopted as representative of approximately 5-percent FMC for ‘‘realworld’’ clothing, based on data submitted in a joint petition for rulemaking.16 DOE determined in the August 2013 Final Rule that the specified 2-percent FMC using the DOE test load was representative of consumer expectations for dryness of clothing in field use. 78 FR 49608, 49620–49622, 49610–49611 (Aug. 14, 2013). DOE has not identified any systemic problems with any consumer clothes dryer types being able to achieve the required FMC of 2 percent or less, such that amendments to the test procedure would be warranted and therefore did not amend the FMC requirement for either appendix D1 or appendix D2 in the October 2021 TP Final Rule. 86 FR 56608, 56626. ASAP, NRDC, and Samsung requested that DOE consider the testing of an additional smaller test load to supplement the current test load, stating a smaller test load could better represent consumer use and clothes dryer efficiency. (ASAP, NRDC, No. 25 at p. 1; Samsung, No. 29 at p. 3) As stated in the October 2021 TP Final Rule, with little expected change to the CEFD2 value when considering the energy consumption associated with a range of load sizes, DOE does not believe the additional testing would provide consumers with improved information 16 The petition was submitted by AHAM, Whirlpool Corporation, General Electric Company, Electrolux, LG Electronics, Inc., BSH, Alliance Laundry Systems, Viking Range, Sub-Zero Wolf, Friedrich A/C, U-Line, Samsung, Sharp Electronics, Miele, Heat Controller, AGA Marvel, Brown Stove, Haier, Fagor America, Airwell Group, Arcelik, Fisher & Paykel, Scotsman Ice, Indesit, Kuppersbusch, Kelon, and DeLonghi, American Council for an Energy Efficient Economy, Appliance Standards Awareness Project, Natural Resources Defense Council, Alliance to Save Energy, Alliance for Water Efficiency, Northwest Power and Conservation Council, and Northeast Energy Efficiency Partnerships, Consumer Federation of America and the National Consumer Law Center. See Docket No. EERE–2011–BT–TP– 0054, No. 3. PO 00000 Frm 00011 Fmt 4701 Sfmt 4702 51743 that would change their purchasing decisions compared to the current test procedure. As such, any incremental benefit of testing with additional load sizes would be outweighed by the significant added burden that would be imposed by conducting such tests. For these reasons, DOE did not propose or adopt any amendments to the test procedure requiring additional test load sizes in the October 2021 TP Final Rule. 86 FR 56608, 56621. In response to the preliminary analysis, the California IOUs presented data suggesting that consumer clothes dryers that have identical ratings under appendix D1 can vary considerably when tested to appendix D2, and also stated that DOE’s analysis in the preliminary TSD shows that baseline efficiency consumer clothes dryers tested under appendix D1 significantly underperform when tested under appendix D2. For these reasons, the California IOUs recommended that DOE use this rulemaking or the open test procedure rulemaking to phase out appendix D1 in favor of an updated appendix D2 test procedure. Samsung further supported DOE requiring the appendix D2 test procedure for manufacturers as the mandatory procedure for testing consumer clothes dryers. (California IOUs, No. 26 at p. 5) According to Samsung, appendix D2 has been recognized by stakeholders as truly representing how automatic termination control dryers are used by consumers, and manufacturers of ENERGY STARqualified consumer clothes dryers are familiar with, and have invested in, the test procedure in appendix D2, as it is already mandated for ENERGY STAR qualification. Furthermore, Samsung asserted that the appendix D1 test procedure was intended as a stopgap measure to test ‘‘sensor [automatic termination control] dryers’’ using ‘‘non-sensing’’ settings (i.e., timer drying cycle) and does not represent how automatic termination clothes dryers are used by consumers as accurately as the appendix D2 test procedure. Samsung recommended that, since appendix D2 has been used for many years for ENERGY STAR qualification, appendix D1 be phased out now, with an appropriate adjustment to the underlying energy conservation standards to reflect the change in test method as described in EPCA. (Samsung, No. 29 at p. 2) As discussed in the October 2021 TP Final Rule, the version of appendix D2 adopted in that final rule would be used for the evaluation and issuance of updated energy conservation standards, with compliance with that version of appendix D2 required on the E:\FR\FM\23AUP2.SGM 23AUP2 lotter on DSK11XQN23PROD with PROPOSALS2 51744 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules implementation date of updated standards. 86 FR 56608, 56635–56636 (Oct. 8, 2021). Accordingly, DOE notes that the preliminary analysis and this NOPR analysis are based on the appendix D2 test procedure, and therefore the proposed amended energy conservation standards in this document are also based on the appendix D2 test procedure. These proposed amendments are discussed in more detail in section IV.C of this document. feasible for such product. (42 U.S.C. 6295(p)(1)) Accordingly, in the engineering analysis, DOE determined the maximum technologically feasible (‘‘max-tech’’) improvements in energy efficiency for consumer clothes dryers, using the design parameters for the most efficient products available on the market or in working prototypes. The max-tech levels that DOE determined for this rulemaking are described in section IV.C.1 of this document and in chapter 5 of the NOPR TSD. C. Technological Feasibility D. Energy Savings 1. General 1. Determination of Savings In evaluating potential amendments to energy conservation standards, DOE conducts a screening analysis based on information 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 an analysis, DOE develops a list of technology options for consideration in consultation with manufacturers, design engineers, and other interested parties. DOE then determines which of those means for improving efficiency are technologically feasible. DOE considers technologies incorporated in commercially-available products or in working prototypes to be technologically feasible. Sections 6(b)(3)(i) and 7(b)(1) of appendix A. After DOE has determined that particular technology options are technologically feasible, it further evaluates each technology option in light of the following additional screening criteria: (1) practicability to manufacture, install, and service; (2) adverse impacts on product utility or availability; (3) adverse impacts on health or safety, and (4) unique-pathway proprietary technologies. Sections 6(b)(3)(ii)–(v) and 7(b)(2)–(5) of appendix A. Section IV.B of this document discusses the results of the screening analysis for consumer clothes dryers, particularly the designs DOE considered, those it screened out, and those that are the basis for the standards considered in this rulemaking. For further details on the screening analysis for this rulemaking, see chapter 4 of the NOPR TSD. For each trial standard level (‘‘TSL’’), DOE projected energy savings from application of the TSL to consumer clothes dryers purchased in the 30-year period that begins in the year of compliance with the proposed standards (2027–2056).17 The savings are measured over the entire lifetime of consumer clothes dryers purchased in the previous 30-year period. DOE quantified the energy savings attributable to each TSL as the difference in energy consumption between each standards case and the nonew-standards case. The no-newstandards case represents a projection of energy consumption that reflects how the market for a product would likely evolve in the absence of amended energy conservation standards. DOE used its national impact analysis (‘‘NIA’’) spreadsheet model to estimate national energy savings (‘‘NES’’) from potential amended or new standards for consumer clothes dryers. The NIA spreadsheet model (described in section IV.H of this document) calculates energy savings in terms of site energy, which is the energy directly consumed by products at the locations where they are used. For electricity, DOE reports national energy savings in terms of primary energy savings, which is the savings in the energy that is used to generate and transmit the site electricity. For natural gas, the primary energy savings are considered to be equal to the site energy savings. DOE also calculates NES in terms of FFC energy savings. The FFC metric includes the energy consumed in extracting, processing, and transporting primary fuels (i.e., coal, natural gas, petroleum fuels), and thus presents a more complete picture of the impacts of 2. Maximum Technologically Feasible Levels When DOE proposes to adopt an amended standard for a type or class of covered product, it must determine the maximum improvement in energy efficiency or maximum reduction in energy use that is technologically VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 17 Each TSL is composed of specific efficiency levels for each product class. The TSLs considered for this NOPR are described in section V.A of this document. DOE conducted a sensitivity analysis that considers impacts for products shipped in a 9year period. PO 00000 Frm 00012 Fmt 4701 Sfmt 4702 energy conservation standards.18 DOE’s approach is based on the calculation of an FFC multiplier for each of the energy types used by covered products or equipment. For more information on FFC energy savings, see section IV.H.2 of this document. 2. Significance of Savings To adopt any new or amended standards for a covered product, DOE must determine that such action would result in significant energy savings. The significance of energy savings offered by a new or amended energy conservation standard cannot be determined without knowledge of the specific circumstances surrounding a given rulemaking.19 For example, some covered products and equipment have most of their energy consumption occur during periods of peak energy demand. The impacts of these products on the energy infrastructure can be more pronounced than products with relatively constant demand. In evaluating the significance of energy savings, DOE considers differences in primary energy and FFC effects for different covered products and equipment when determining whether energy savings are significant. Primary energy and FFC effects include the energy consumed in electricity production (depending on load shape), in distribution and transmission, and in extracting, processing, and transporting primary fuels (i.e., coal, natural gas, petroleum fuels), and thus present a more complete picture of the impacts of energy conservation standards. Accordingly, DOE evaluates the significance of energy savings on a caseby-case basis, taking into account the significance of cumulative FFC national energy savings, the cumulative FFC emissions reductions, and the need to confront the global climate crisis, among other factors. As discussed in section V.C of this document, DOE is proposing to adopt TSL 3, which would save an estimated 3.11 quads of energy (FFC). DOE has initially determined that these energy savings are ‘‘significant’’ within the meaning of 42 U.S.C. 6295(o)(3)(B). E. Economic Justification 1. Specific Criteria As noted previously, EPCA provides seven factors to be evaluated in 18 The FFC metric is discussed in DOE’s statement of policy and notice of policy amendment. 76 FR 51282 (Aug. 18, 2011), as amended at 77 FR 49701 (Aug. 17, 2012). 19 The numeric threshold for determining the significance of energy savings established in a final rule published on February 14, 2020 (85 FR 8626, 8670), was subsequently eliminated in a final rule published on December 13, 2021 (86 FR 70892). E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules determining whether a potential energy conservation standard is economically justified. (42 U.S.C. 6295(o)(2)(B)(i)(I)– (VII)) The following sections discuss how DOE has addressed each of those seven factors in this rulemaking. lotter on DSK11XQN23PROD with PROPOSALS2 a. Economic Impact on Manufacturers and Consumers In determining the impacts of a potential amended standard on manufacturers, DOE conducts an MIA, as discussed in section IV.J of this document. 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 (1) INPV, which values the industry on the basis of expected future cash flows; (2) cash flows by year; (3) changes in revenue and income; and (4) 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 individual consumers, measures of economic impact include the changes in LCC and PBP associated with new or amended standards. These measures are discussed further in the following section. For consumers in the aggregate, DOE also calculates the national net present value of the consumer costs and benefits expected to result from particular standards. DOE also evaluates the impacts of potential standards on identifiable subgroups of consumers that may be affected disproportionately by a standard. b. Savings in Operating Costs Compared to Increase in Price (LCC and PBP) EPCA requires DOE to consider the savings in operating costs throughout the estimated average life of the covered product in the type (or class) compared to any increase in the price of, or in the initial charges for, or maintenance expenses of, the covered product that are likely to result from a standard. (42 U.S.C. 6295(o)(2)(B)(i)(II)) DOE conducts this comparison in its LCC and PBP analysis. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 The LCC is the sum of the purchase price of a product (including its installation) and the operating expense (including energy, maintenance, and repair expenditures) discounted over the lifetime of the product. The LCC analysis requires a variety of inputs, such as product prices, product energy consumption, energy prices, maintenance and repair costs, product lifetime, and discount rates appropriate for consumers. To account for uncertainty and variability in specific inputs, such as product lifetime and discount rate, DOE uses a distribution of values, with probabilities attached to each value. The PBP is the estimated amount of time (in years) it takes consumers to recover the increased purchase cost (including installation) of a moreefficient product through lower operating costs. DOE calculates the PBP by dividing the change in purchase cost due to a more-stringent standard by the change in annual operating cost for the year that standards are assumed to take effect. For its LCC and PBP analysis, DOE assumes that consumers will purchase the covered products in the first year of compliance with new or amended standards. The LCC savings for the considered efficiency levels are calculated relative to the case that reflects projected market trends in the absence of new or amended standards. DOE’s LCC and PBP analysis is discussed in further detail in section IV.F of this document. c. Energy Savings Although significant conservation of energy is a separate statutory requirement for adopting 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)) As discussed in section III.D of this document, DOE uses the NIA spreadsheet models to project national energy savings. d. Lessening of Utility or Performance of Products In establishing product classes and in evaluating design options and the impact of potential standard levels, DOE evaluates potential standards that would not lessen the utility or performance of the considered products. (42 U.S.C. 6295(o)(2)(B)(i)(IV)) Based on data available to DOE, the standards proposed in this document would not reduce the utility or performance of the PO 00000 Frm 00013 Fmt 4701 Sfmt 4702 51745 products under consideration in this rulemaking. 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 a proposed standard. (42 U.S.C. 6295(o)(2)(B)(i)(V)) It also directs the Attorney General to determine the impact, 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 this proposed rule to the Attorney General with a request that the Department of Justice (‘‘DOJ’’) provide its determination on this issue. DOE will publish and respond to the Attorney General’s determination in the final rule. DOE invites comment from the public regarding the competitive impacts that are likely to result from this proposed rule. In addition, stakeholders may also provide comments separately to DOJ regarding these potential impacts. See the ADDRESSES section for information to send comments to DOJ. f. Need for National Energy Conservation DOE also considers the need for national energy and water conservation in determining whether a new or amended standard is economically justified. (42 U.S.C. 6295(o)(2)(B)(i)(VI)) 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, as discussed in section IV.M of this document. DOE maintains that environmental and public health benefits associated with the more efficient use of energy are important to take into account when considering the need for national energy conservation. The proposed standards are likely to result in environmental benefits in the form of reduced emissions of air pollutants and greenhouse gases (‘‘GHGs’’) associated with energy production and use. DOE conducts an emissions analysis to estimate how potential standards may E:\FR\FM\23AUP2.SGM 23AUP2 lotter on DSK11XQN23PROD with PROPOSALS2 51746 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules affect these emissions, as discussed in section IV.K of this document; the estimated emissions impacts are reported in section V.B.6 of this document. DOE also estimates the economic value of health benefits from certain emissions reductions resulting from the considered TSLs, as discussed in section IV.L of this document. AHAM stated its continued objection to DOE’s use of the social cost of carbon and other monetization of emissions reductions benefits in its analysis of the factors EPCA requires DOE to balance to determine the appropriate standard. According to AHAM, while it may be acceptable for DOE to continue its current practice of examining the social cost of carbon and monetization of other emissions reductions benefits as informational so long as the underlying interagency analysis is transparent and vigorous, the monetization analysis should not impact the trial standards levels DOE selects as a new or amended standard. (AHAM, No. 23 at pp. 11–12) DOE’s evaluation of whether a potential energy conservation standard is economically justified is guided by EPCA and also by OMB Circular A–4 (Sept. 17, 2003), which provides guidance to Federal agencies on the development of regulatory analysis. As indicated above, DOE believes that avoiding negative impacts to human health and the wide range of impacts associated with climate change are key factors behind the need for energy conservation.20 OMB Circular A–4 states: ‘‘Benefit-cost analysis is a primary tool used for regulatory analysis. Where all benefits and costs can be quantified and expressed in monetary units, benefit-cost analysis provides decision makers with a clear indication of the most efficient alternative, that is, the alternative that generates the largest net benefits to society.’’ (p. 2) Monetizing public health benefits of regulations is a long-standing practice in Federal regulatory analysis. To not consider such benefits when evaluating whether a potential energy conservation standard is economically justified would be contrary to both EPCA and OMB’s guidance. In addition, on March 16, 2022, the Fifth Circuit Court of Appeals (No. 22–30087) granted the federal government’s emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued in Louisiana v. Biden, No. 21–cv–1074– JDC–KK (W.D. La.). As a result of the 20 As mentioned previously, following the preliminary injunction issued on February 11, 2022, in Louisiana v. Biden, No. 21–cv–1074–JDC–KK (W.D. La.), DOE is currently not monetizing the costs of greenhouse gas emissions. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 Fifth Circuit’s order, the preliminary injunction is no longer in effect, pending resolution of the federal government’s appeal of that injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in that case from ‘‘adopting, employing, treating as binding, or relying upon’’ the interim estimates of the social cost of greenhouse gases—which were issued by the Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 2021—to monetize the benefits of reducing greenhouse gas emissions. As reflected in this rule, DOE has reverted to its approach prior to the injunction and presents monetized greenhouse gas abatement benefits where appropriate and permissible under law. g. Other Factors In determining whether an energy conservation standard is economically justified, DOE may consider any other factors that the Secretary deems to be relevant. (42 U.S.C. 6295(o)(2)(B)(i)(VII)) To the extent DOE identifies any relevant information regarding economic justification that does not fit into the other categories described previously, DOE could consider such information under ‘‘other factors.’’ 2. Rebuttable Presumption As set forth in 42 U.S.C. 6295(o)(2)(B)(iii), EPCA creates a rebuttable presumption that an energy conservation standard is economically justified if the additional cost to the consumer of a product that meets the standard 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 analyses generate values used to calculate the effects that proposed energy conservation standards would have on the payback period for consumers. These analyses include, but are not limited to, the 3-year payback period contemplated under the rebuttable-presumption test. In addition, DOE routinely conducts an economic analysis that considers the full range of impacts to consumers, manufacturers, the Nation, and the environment, as required under 42 U.S.C. 6295(o)(2)(B)(i). The results of this analysis 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 PO 00000 Frm 00014 Fmt 4701 Sfmt 4702 discussed in section IV.F.9 of this document. IV. Methodology and Discussion of Related Comments This section addresses the analyses DOE has performed for this rulemaking with regard to consumer clothes dryers. Separate sections address each component of DOE’s analyses. DOE used several analytical tools to estimate the impact of the standards proposed in this document. The first tool is a spreadsheet that calculates the LCC savings and PBP of potential amended or new energy conservation standards. The national impacts analysis uses a second spreadsheet set that provides shipments projections and calculates national energy savings and net present value of total consumer costs and savings expected to result from potential energy conservation standards. DOE uses the third spreadsheet tool, the Government Regulatory Impact Model (‘‘GRIM’’), to assess manufacturer impacts of potential standards. These three spreadsheet tools are available on the DOE website for this rulemaking: www.regulations.gov/ docket/EERE–2014–BT–STD–0058/. Additionally, DOE used output from the latest version of the Energy Information Administration’s (‘‘EIA’s’’) Annual Energy Outlook (‘‘AEO’’), a widely known energy projection for the United States, for the emissions and utility impact analyses. A. Market and Technology Assessment DOE develops information in the market and technology assessment that provides an overall picture of the market for the products concerned, including the purpose of the products, the industry structure, manufacturers, market characteristics, and technologies used in the products. This activity includes both quantitative and qualitative assessments, based primarily on publicly available information. The subjects addressed in the market and technology assessment for this rulemaking include (1) a determination of the scope of the rulemaking and product classes, (2) manufacturers and industry structure, (3) existing efficiency programs, (4) shipments information, (5) market and industry trends, and (6) technologies or design options that could improve the energy efficiency of consumer clothes dryers. The key findings of DOE’s market assessment are summarized in the following sections. See chapter 3 of the NOPR TSD for further discussion of the market and technology assessment. E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules 1. Scope of Coverage and Product Classes DOE defines ‘‘electric clothes dryer’’ under EPCA as a cabinet-like appliance designed to dry fabrics in a tumble-type drum with forced air circulation. The heat source is electricity and the drum and blower(s) are driven by an electric motor(s). Similarly, DOE defines ‘‘gas clothes dryer’’ as a cabinet-like appliance designed to dry fabrics in a tumble-type drum with forced air circulation. The heat source is gas and the drum and blower(s) are driven by an electric motor(s). (10 CFR 430.2) In response to the preliminary analysis, the California IOUs offered information on at least two manufacturers producing a dry-andsteam clothing cabinet and encouraged DOE to explore the market prevalence and potential growth of this equipment and what features represent an average use cycle. The California IOUs also suggested DOE consider the current clothes washers rulemaking or dehumidifiers rulemaking to provide 51747 guidance on how this product should be classified and, if appropriate, tested and rated. (California IOUs, No. 26 at p. 7) DOE may investigate this product in a future rulemaking; however, as this product does not meet the definition of a clothes dryer because it does not include a tumble-type drum, it was not included in this analysis. The current product classes, which were established by the April 2011 Direct Final Rule, are presented in Table IV.1. TABLE IV.1—CURRENT CONSUMER CLOTHES DRYER PRODUCT CLASSES lotter on DSK11XQN23PROD with PROPOSALS2 Vented dryers: Electric, Standard (4.4 cubic feet (ft3) or greater capacity). Electric, Compact (120 volts (V)) (less than 4.4 ft3 capacity). Electric, Compact (240 V) (less than 4.4 ft3 capacity). Gas. Ventless dryers: Electric, Compact (240 V) (less than 4.4 ft3 capacity). Electric, Combination Washer-Dryer. Based on its review of products available on the market in the United States, DOE notes that at least six manufacturers currently offer a ventless clothes dryer with a drum capacity greater than 4.4 ft3. As a result, in the preliminary analysis, DOE analyzed an additional product class for ventless electric standard clothes dryers, with drum capacity larger than 4.4 ft3. In response to the preliminary analysis, the California IOUs requested that DOE investigate potential reporting errors within the Compliance Certification Database (‘‘CCD’’), as the California IOUs asserted that multiple products were incorrectly listed in the CCD as ‘‘vented’’ products while certified as ‘‘ventless’’ products in the ENERGY STAR product database and represented as ‘‘ventless’’ in manufacturer literature. (California IOUs, No. 26 at p. 4) DOE will work to investigate any classification errors within the CCD and requests comment on additional information regarding potential classification errors. In response to the preliminary analysis, ASAP, NRDC, the California IOUs, and NEEA requested that DOE review the efficiencies of models currently available on the market, specifically for the vented electric standard product class, stating that there are currently available models with higher efficiencies than the max-tech efficiency level considered in the preliminary analysis for this product class. (ASAP, NRDC, No. 25 at pp. 1–2; California IOUs, No. 26 at pp. 3–4; NEEA, No. 30 at pp. 10–11) Upon review of these higher efficiency VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 models, DOE discovered that many of the higher efficiency electric standard clothes dryers on the market are ventless and employ heat pump technology and that there are no lowerefficiency ventless electric standard models associated with the less efficient condensing technology that is available with the ventless electric compact (240V) product class. Given that most heat pump designs at the standard size are inherently ventless and result in higher efficiencies, establishing a product class for ventless electric standard clothes dryers would essentially result in a separate product class for heat pump dryers and leave the vented electric standard product class with less efficient conventional resistive heating-element dryers. This would effectively restrict the efficiency of the vented electric standard product class, as higher efficiency technologies would be associated with a different product class. DOE received comments from AHAM and Whirlpool in response to the preliminary analysis stating that ventless electric clothes dryers, especially those implementing heat pump designs, have difficulty in meeting the 2-percent FMC requirement with Whirlpool stating that ventless electric clothes dryers result in longer cycle times than conventional vented clothes dryers. (AHAM, No. 23, p. 11; Whirlpool, No. 27 at pp. 13–17) Additionally, Whirlpool recommended that DOE consider the consumer utility of the differences that arise when consumer clothes dryers utilize heat pump technology and to establish a PO 00000 Frm 00015 Fmt 4701 Sfmt 4702 separate product class for heat pump clothes dryers (including hybrid heat pump clothes dryers). Whirlpool stated that differences in fabric care, drying time, heating and cooling energy impacts, lower drying temperatures, and technology used are all relevant performance-related features that distinguish heat pump and hybrid heat pump clothes dryers from all other consumer clothes dryer product classes, which may justify a higher standard than for other product types. (Whirlpool, No. 27 at p. 17) DOE observes that all standard size ventless electric clothes dryers and compact ventless electric (120V) clothes dryers are rated according to appendix D2 and are ENERGY STAR-qualified, and therefore meet the 80-minute cycle time requirement to receive ENERGY STAR recognition. Additionally, DOE found no issue in its own testing of ventless electric clothes dryers inherent in the ventless electric clothes dryer design that supports the claims made by commenters regarding difficulty in meeting the FMC requirement and longer cycle times (i.e., all ventless electric clothes dryers tested, including those utilizing either condensing or heat pump technology, were able to meet the 2-percent FMC requirement). As discussed, a rule prescribing an energy conservation standard must specify a level of energy use or efficiency higher or lower than that which applies (or would apply) for any group of covered products which have the same function or intended use, if the Secretary determines that covered products within such group have a E:\FR\FM\23AUP2.SGM 23AUP2 51748 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules capacity or other performance-related feature which justifies a higher or lower standard. (42 U.S.C. 6295(q)(1)(B)) For standard size electric clothes dryers, the ventless feature does not justify a separate standard as compared to standard size electric clothes dryers that are vented. Standard size ventless electric clothes dryers can accommodate heat pump technology that results in improved efficiency similar to that for standard size vented electric clothes dryers. Therefore, upon further consideration, no product class distinction is proposed in this NOPR between ventless and vented electric standard clothes dryers, nor between heat pump and non-heat pump clothes dryers. Instead, DOE proposes an ‘‘electric standard’’ product class that would comprise both ventless and vented electric standard clothes dryers. Such a product class would not impact consumer utility, given that a consumer could install a ventless electric standard clothes dryer in the same locations as vented electric standard clothes dryers, and would not result in unacceptable drying performance or cycle time, as evidenced by the existing heat pump clothes dryers that are able to achieve the 2-percent FMC requirement within an 80-minute cycle time. In response to the preliminary analysis, the California IOUs requested that DOE consider an additional product class for ventless electric compact (120V) models, as such clothes dryers are currently available on the market. (California IOUs, No. 26 at p. 3) Upon further review, DOE found that, as for ventless electric standard clothes dryers, all currently available ventless electric compact (120V) clothes dryers utilize heat pump technology. For the same reasons as for electric standard clothes dryers (i.e., to capture the energy savings associated with heat pump technology and to avoid restricting potential efficiency gains for vented electric clothes dryers), DOE proposes an ‘‘electric compact (120V)’’ product class comprising ventless and vented electric compact (120V) models. In light of the proposal to have single product classes containing all standard size electric clothes dryers and a single product class for all compact electric (120V) clothes dryers, DOE also considered whether to maintain the current separate product classes distinction based on venting for compact electric (240V) clothes dryers. DOE has previously determined that for compact electric clothes dryers, a ventless configuration is a consumer utility because these dryers provide for installations in space-constrained environments. 76 FR 22454, 22485 (Apr. 21, 2011). Based on the analysis presented in this NOPR, DOE has tentatively determined that the higher efficiencies for ventless compact (240V) clothes dryers would not be economically justified as they would be for vented compact (240V) clothes dryers. See Section IV.F of this document. Therefore, DOE tentatively determines that venting characteristics continue to justify a separate product class for compact (240V) clothes dryers. As discussed, vented electric clothes dryers are divided, in part, based on capacity such that there is a standard size product class (4.4 ft3 or greater capacity) and compact classes (capacity less than 4.4 ft3). There is no similar class distinction for vented gas clothes dryers. Since the previous energy conservation standards rulemaking, DOE has identified at least one manufacturer of a vented gas clothes dryer with a drum less than 4.4 ft3. Such capacity units are subject to the energy conservation standard for vented gas clothes dryers. AHAM supported splitting the product classes for gas clothes dryers based on capacity consistent with the product classes for electric dryers. (AHAM, No. 23 at p. 7) As discussed, DOE must specify a different standard level for a type or class of product 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 products within such type (or class); or (B) have a capacity or other performance-related feature which other products within such type (or class) do not have and such feature justifies a higher or lower standard. (42 U.S.C. 6295(q)(1)) In determining whether a performance-related feature justifies a different standard for a group of products, DOE must consider such factors as the utility to the consumer of the feature and other factors DOE deems appropriate. Id. In evaluating potential technologies to improve the energy efficiency of vented gas clothes dryers, DOE tentatively has determined that vented gas clothes dryers with a capacity of less than 4.4 ft3 perform in a way that is substantively different than vented gas clothes dryers that are 4.4 ft3 or greater in capacity. For example, DOE has observed that compact vented gas clothes dryers generally perform at a lower efficiency than standard size vented gas clothes dryers, likely due to the chassis size restrictions, and due to that inherent difference, DOE believes that a separate product class is warranted. Furthermore, creating a new product class for vented gas clothes dryers with a capacity of less than 4.4 ft3 would ensure that efficiency levels and potential amended standards could better and more directly assess the impact of design option implementations for a given product configuration. Therefore, DOE has tentatively determined that a separate product class and standard for vented gas compact clothes dryers (i.e., with a capacity less than 4.4 ft3) are justified for similar reasons as DOE determined for vented electric compact clothes dryers. See 76 FR 22404, 22485 (Apr. 21, 2011). As a result, DOE analyzed separate product classes for vented gas standard and vented gas compact clothes dryers. In sum, DOE proposes the consumer clothes dryer product classes listed in Table IV.2 in this NOPR, which expand the scope of certain product classes to include both vented and ventless designs, and include an additional product class for compact vented gas dryers. lotter on DSK11XQN23PROD with PROPOSALS2 TABLE IV.2—NOTICE OF PROPOSED RULEMAKING CONSUMER CLOTHES DRYER PRODUCT CLASSES Product Classes: 1. Electric, Standard (4.4 cubic feet (ft3) or greater capacity). 2. Electric, Compact (120 volts (V)) (less than 4.4 ft3 capacity). 3. Vented Electric, Compact (240 V) (less than 4.4 ft3 capacity). 4. Vented Gas, Standard (4.4 ft3 or greater capacity). 5. Vented Gas, Compact (less than 4.4 ft3 capacity). 6. Ventless Electric, Compact (240 V) (less than 4.4 ft3 capacity). 7. Ventless Electric, Combination Washer/Dryer. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00016 Fmt 4701 Sfmt 4702 E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules 2. Technology Options efficiency of consumer clothes dryers, as measured by the DOE test procedure. DOE continues to consider these technology options in this NOPR analysis. These technology options can be broadly grouped into five main In the preliminary market analysis and technology assessment, DOE identified 16 technology options that would be expected to improve the 51749 categories: dryer control or drum upgrades, methods of exhaust heat recovery (for vented models only), heat generation options, improvements to components, and options to reduce standby power. TABLE IV.3—PRELIMINARY ANALYSIS: TECHNOLOGY OPTIONS FOR CONSUMER CLOTHES DRYERS lotter on DSK11XQN23PROD with PROPOSALS2 Dryer Control or Drum Upgrades: Improved termination. Increased insulation. Modified operating conditions. Improved air circulation. Improved drum design. Methods of Exhaust Heat Recovery (Vented Models Only): Recycle exhaust heat. Inlet air preheat. Inlet air preheat, condensing mode. Heat Generation Options: Heat pump, electric only. Thermoelectric heating, electric only. Microwave, electric only. Modulating heat. Indirect heating. Component Improvements: Improved motor efficiency. Improved fan efficiency. Standby Power Improvements: Transformerless power supply with auto-powerdown. DOE notes that two recently developed consumer clothes dryer technologies were not included as part of the preliminary analysis: long wavelength radio frequency (‘‘RF’’) drying and ultrasonic drying. Despite the potential benefits of RF and ultrasonic clothes drying, however, both technologies are currently under patent or have received a provisional patent. Any energy conservation standard that relied on either of these technologies would unfairly advantage the manufacturer or individual holder of the patent, and thus DOE did not consider them as technology options for the preliminary analysis. Because these technologies are technologically feasible, however, DOE proposes in this NOPR to retain these as technology options in the technology assessment, noting one of the criteria for screening technology options for use in further analyses is whether a technology represents a unique proprietary pathway (see section IV.B of this document and chapter 4 of the NOPR TSD). DOE notes that the current energy conservation standards for consumer clothes dryers would not prohibit the use of these technologies. DOE received several comments in response to the technologies proposed in the preliminary analysis to be analyzed for consumer clothes dryers. Whirlpool suggested that reduced drum seal leakage be considered as a technology option. Additionally, VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 Whirlpool stated that approaches to reduce standby power may not be consumer-friendly solutions that manufacturers would readily implement. Whirlpool suggested that delaying the drum light turning on after opening the door or delaying the start of a cycle after powering on the unit would frustrate consumers, as they typically expect appliances to turn on when action is taken such as pressing the power button or opening the door. Whirlpool also suggested an off position on the control dial but stated that intellectual property may exist around this and may result in higher costs. (Whirlpool, No. 27 at p. 17) DOE is not aware of data at this time to characterize the impacts reduced drum seal leakage may have on efficiency and requests information on efficiency impacts of this technology. In addition, the strategies that Whirlpool suggested to reduce energy use in standby mode, including delaying the activation of the drum light after a door opening or delaying the start of the cycle after powering on the unit, would not be measured by appendix D2. Furthermore, although appendix D2 incorporates measures of energy use in both off mode and inactive (standby) mode, DOE does not have information to indicate the relative power consumption in each of these modes for any consumer clothes dryers on the market which may have an off mode position on the controls, which would provide an estimate of the PO 00000 Frm 00017 Fmt 4701 Sfmt 4702 reduction in combined low-power mode energy use. For these reasons, at this time, DOE is not proposing to include these technology options in its analysis. NEEA stated that manufacturers in the current consumer clothes dryer market utilize an ‘‘eco mode’’ as a lower heat/ longer drying time strategy to achieve a given efficiency. NEEA asserted that the efficiency of a consumer clothes dryer increases substantially with lower heat and longer drying time, citing laboratory testing by the California IOUs that quantified this effect by alternating periods of heat with no heat during a cycle. According to the results of this work, NEEA claimed, the average efficiency of consumer clothes dryers with these modified controls increased 30 percent compared to their default settings used for appendix D2 testing, and drying time increased 140 percent. According to NEEA, a no-heat cycle took 4 hours to complete but achieved a CEFD2 value of 7.0. NEEA stated that with the energy savings associated with this strategy, as well as the relatively low cost associated with the redesign of the control panel to enable additional heater/burner algorithms, manufacturers have a solid incentive to extensively utilize eco mode as the sole redesign strategy to enable their models to meet DOE’s forthcoming mandatory standard. NEEA warned that the longer drying times associated with these energy saving programs are unlikely to be acceptable to many consumers in some E:\FR\FM\23AUP2.SGM 23AUP2 51750 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules circumstances (e.g., serial dryer loads and other time-sensitive loads), which could potentially result in consumers regularly disabling these eco modes and may therefore significantly reduce the energy savings of dryers in everyday use relative to expectations created by the current appendix D2 test procedure. Therefore, NEEA requested that DOE require the sole use of appendix D2 for certification purposes as well as the required reporting of cycle times in order to mitigate against significant reductions in actual real-world energy savings associated with a low heat/long drying time eco mode strategy. According to NEEA, cycle time reporting would help moderate inordinately long cycle times during the D2 test, enable consumers and other stakeholders to consider trade-offs between the efficiency and cycle time for a given model, and provide data to possibly consider more sophisticated approaches to cycle time in subsequent standard updates. (NEEA, No. 30 at pp. 1–7) DOE recognizes that some consumer clothes dryers are currently certified using appendix D2, and their controls may include an ‘‘eco mode’’ or ‘‘energy saver mode,’’ which typically reduce the temperature used in the cycle at the expense of increasing the drying time. However, appendix D2 requires, for automatic termination control dryers, that the ‘‘normal’’ program be selected for the energy test cycle. In the event that the automatic termination control dryer does not have a ‘‘normal’’ program, the cycle recommended by the manufacturer for drying cotton or linen clothing is selected. Where the drying temperature setting can be chosen independently of the program (as would be the case if ‘‘eco mode’’ or ‘‘energy saver mode’’ were an optional setting that could be selected for the ‘‘normal’’ program), the drying temperature must be set to the maximum. Section 3.3.2, appendix D2. For timer dryers, the maximum temperature setting is selected for the energy test cycle. Section 3.3.1, appendix D2. Therefore, an available ‘‘eco mode’’ or ‘‘energy saver mode’’ would not be included in the energy test cycle, as they would not produce a measure of energy use during a representative cycle. For this reason, DOE did not consider such energy saving modes as a technology option in this NOPR. NEEA further encouraged DOE to consider the following technology options: (1) coupled blower modulation with the multi-stage burner/heater efficiency level, (2) cabinet insulation, (3) backward curved fan blades, and (4) recuperation heat recovery in vented heat pump clothes dryers associated with a PNNL study. (NEEA, No. 30 at pp. 12–13) DOE notes that blower modulation is already coupled with the multi-stage burner/heater efficiency level for both electric and gas consumer clothes dryers, although this was not previously stated in chapter 5 of the preliminary TSD. DOE has not observed the technology option of cabinet insulation in clothes dryers used in this analysis, and therefore does not currently have sufficient information to determine the potential efficiency impacts associated with the suggested technology options, however, DOE notes that with the inherent risk of fires that may occur during operation of a consumer clothes dryer, any insulation used within the cabinet space would likely need to be fire retardant in order to satisfy the fire containment requirements according to the UL 2158 safety standard. While insulation of the dryer cabinet space would likely lead to potential energy savings, DOE expects that the insulation could lead to an increased internal cabinet temperature and may potentially lead to the degradation of other components within the clothes dryer assembly. DOE therefore requests information that would be beneficial in determining any impacts to efficiency or performance as a result of implementing each of the technology options mentioned. DOE notes that improvements to fan blades would be captured in the analyzed technology options as improved fan efficiency, however the efficiency improvements specified by NEEA refer to heating, ventilation, and air conditioning (‘‘HVAC’’) research and do not specifically refer to efficiency improvements in consumer clothes dryers. Therefore, until DOE has sufficient information on efficiency improvements associated with fan designs, the proposed incremental efficiency levels will not be associated with improved fan efficiency. Regarding the recuperation heat recovery technology option, DOE notes that this technology is already considered in this analysis referred to as the inlet-air preheat design option. Given the proposed change to the product class structure regarding the combination of vented and ventless clothes dryers in the standard and compact (120V) categories, this technology is now considered in the proposed design options for vented consumer clothes dryers, however given that DOE has not observed inlet-air preheat technology in consumer clothes dryers on the market, specifically heat pump consumer clothes dryers, this technology has not been considered at the max-tech level associated with heat pump technology. Table IV.4 lists the technology options identified for consumer clothes dryers in this NOPR. With the inclusion of RF and ultrasonic drying technologies in the list of technology options in the NOPR, DOE has renamed the grouping for ‘‘heat generation options’’ as ‘‘moisture removal options.’’ See chapter 3 of the NOPR TSD for further discussion of the analyzed technologies. lotter on DSK11XQN23PROD with PROPOSALS2 TABLE IV.4—TECHNOLOGY OPTIONS FOR CONSUMER CLOTHES DRYERS Dryer Control or Drum Upgrades: Improved termination. Increased insulation. Modified operating conditions. Improved air circulation. Improved drum design. Methods of Exhaust Heat Recovery (Vented Models Only): Recycle exhaust heat. Inlet air preheat. Inlet air preheat, condensing mode. Moisture Removal Options: Heat pump, electric only. Thermoelectric heating, electric only. Microwave, electric only. Modulating heat. Indirect heating. RF drying, electric only. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00018 Fmt 4701 Sfmt 4702 E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules 51751 TABLE IV.4—TECHNOLOGY OPTIONS FOR CONSUMER CLOTHES DRYERS—Continued Ultrasonic drying, electric only. Component Improvements: Improved motor efficiency. Improved fan efficiency. Standby Power Improvements: Transformerless power supply with auto-powerdown. lotter on DSK11XQN23PROD with PROPOSALS2 B. Screening Analysis DOE uses the following five screening criteria to determine which technology options are suitable for further consideration in an energy conservation standards rulemaking: (1) Technological feasibility. Technologies that are not incorporated in commercial products or in working prototypes will not be considered further. (2) Practicability to manufacture, install, and service. If it is determined that mass production and reliable installation and servicing of a technology in commercial products could not be achieved on the scale necessary to serve the relevant market at the time of the projected compliance date of the standard, then that technology will not be considered further. (3) Impacts on product utility or product availability. If it is determined that a technology would have a significant adverse impact on the utility of the product for significant subgroups of consumers or would result in the unavailability of any covered product type with performance characteristics (including reliability), features, sizes, capacities, and volumes that are substantially the same as products generally available in the United States at the time, it will not be considered further. (4) Adverse impacts on health or safety. If it is determined that a technology would have significant adverse impacts on health or safety, it will not be considered further. (5) Unique-Pathway Proprietary Technologies. If a design option utilizes proprietary technology that represents a unique pathway to achieving a given efficiency level, that technology will not be considered further due to the potential for monopolistic concerns. 10 CFR part 430, subpart C, appendix A, 6(b)(3) and 7(b). In summary, if DOE determines that a technology, or a combination of technologies, fails to meet one or more of the listed five criteria, it will be excluded from further consideration in the engineering analysis. The reasons for eliminating any technology are discussed in the following sections. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 The subsequent sections include comments from interested parties pertinent to the screening criteria, DOE’s evaluation of each technology option against the screening analysis criteria, and whether DOE determined that a technology option should be excluded (‘‘screened out’’) based on the screening criteria. 1. Screened-Out Technologies AHAM requested that DOE consider the effects that different technology options may have on fabric care, specifically the impact longer drying cycles may have on fabric. (AHAM, No. 23 at p. 10) While certain technology options may be associated with an increase in cycle times (e.g., modified operating conditions (reduced drying temperatures) and heat pump technology), DOE notes that AHAM did not provide, nor is DOE aware of, information correlating fabric care directly to cycle time. In addition, if longer cycle times are accompanied by lower drying temperatures, it is uncertain whether the net impact on fabric care is positive or negative, and how this result would vary based on fabric type. Therefore, DOE did not screen out any technology options solely on the basis of any fabric care considerations due to cycle time. However, DOE requests comment on any potential impacts that different technology options, including any that may impact cycle times, have on fabric care. a. Thermoelectric Heating, Electric Only DOE notes that Oak Ridge National Laboratory (‘‘ORNL’’) is still researching thermoelectric heating clothes dryers. While ORNL’s test results of a preliminary prototype have shown the potential for improved efficiency, ORNL indicated that the initial prototype design produced longer-than-desired drying times due to direct-contact heat transfer limitations via the drum surface. ORNL has subsequently developed another prototype which added pumped secondary water loops that transferred heat from the thermoelectric modules to the process air via air-to-water heat exchangers to further improve efficiency and minimize cycle length. ORNL’s testing PO 00000 Frm 00019 Fmt 4701 Sfmt 4702 indicated efficiency and cycle times for this prototype that are approximately equivalent to those of vapor compression heat pump clothes dryers.21 Because the research for such a thermoelectric heating clothes dryer that produces energy savings and meets consumer expectations for drying cycle time is still in the prototype stage, DOE determined that this technology option would not be practicable to manufacture, install, and service on a scale necessary to serve the relevant market at the time of the projected compliance date of any new or amended consumer clothes dryer standards, and did not be consider it for further analysis. b. Microwave, Electric Only Due to the large energy savings associated with microwave drying, this technology was the subject of a multiyear development effort at the Electric Power Research Institute (‘‘EPRI’’) in the mid-1990s; 22 and at least one major manufacturer, Whirlpool Corporation (‘‘Whirlpool’’), developed a countertopscale version of such a product as recently as 2002,23 but to date this technology has not been successfully commercialized. Significant technical and safety issues are introduced by the potential arcing from metallic objects in the fabric load, including zippers, buttons, or ‘‘stray’’ items such as coins. While efforts have been made to mitigate the conditions that are favorable to arcing, or to detect incipient arcing and terminate the cycle, the possibility of fabric damage cannot be completely eliminated.24 In addition to consumer utility impacts, these conditions can also pose a safety hazard. 21 Patel, V., Boudreaux, P., and Gluesenkamp, K. Oak Ridge National Laboratory. Validated Model of a Thermoelectric Heat Pump Clothes Dryer Using Secondary Pumped Loops. Applied Thermal Engineering, Volume 184, February 5, 2021. 22 S. Ashley. 1998. ‘‘Energy-Efficient Appliances’’, Mechanical Engineering Magazine, March, 1998, pp. 94–97. 23 E. Spagat. 2002. ‘‘Whirlpool Goes Portable to Sell Dryers to Gen Y’’, Wall Street Journal, June 4, 2002. 24 J.F. Gerling. 2003. ‘‘Microwave Clothes Drying—Technical Solutions to Fundamental Challenges’’, Appliance Magazine, April, 2003, p. 120. E:\FR\FM\23AUP2.SGM 23AUP2 51752 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules Indirect heating would be viable only in residences that use a hydronic heating system. Also, in order to derive clothes dryer heat energy from the home’s heating system, significant plumbing work would be required to circulate heated water through a heat exchanger in the clothes dryer. Therefore, this technology option does not meet the criterion of practicability to install on a scale necessary to serve the relevant market at the time of the effective date of any new standard and will not be considered for further analysis. convective heat transfer, the RF clothes dryer requires less tumbling and subsequently consumes less energy for drum rotation than a conventional clothes dryer. Because this technology was in the prototype stage at the time it was initially considered and the company is no longer in business and thus there is likely no longer research and development ongoing, DOE determined that this technology option would not be practicable to manufacture, install, and service on a scale necessary to serve the relevant market at the time of the projected compliance date of any new or amended consumer clothes dryer standards, and did not be consider it for further analysis. energy is substantially less than the latent heat of vaporization of water, which is the primary thermodynamic barrier for conventional evaporation drying. The ORNL researchers anticipate that ultrasonic drying technology will result in an energy factor (‘‘EF’’) 26 of greater than 10 and a drying time of less than 20 minutes.27 Because this technology is still in the prototype stage, DOE determined that this technology option would not be practicable to manufacture, install, and service on a scale necessary to serve the relevant market at the time of the projected compliance date of any new or amended consumer clothes dryer standards, and did not be consider it for further analysis. d. RF Drying, Electric Only e. Ultrasonic Drying, Electric Only 2. Remaining Technologies CoolDry, LLC (‘‘CoolDry’’), developed an RF clothes dryer prototype, claiming an efficiency of 90 percent, compared to 50 percent for conventional clothes dryers.25 CoolDry states that its RF drying technology operates at lower temperatures than do conventional clothes dryers and, because the transfer of energy to clothes is not dependent on Researchers at ORNL have developed an ultrasonic drying prototype that uses piezoelectric transducers to separate water from clothes through water cavitation produced by ultrasonic vibrations. According to their research, the energy imparted to the water must overcome surface tension in order to break the water into droplets, but this Through a review of each technology, DOE tentatively concludes that all of the other identified technologies listed in section IV.A.2 of this document met all five screening criteria to be examined further as design options in DOE’s NOPR analysis. In summary, DOE did not screen out the following technology options listed in Table IV.5. For these reasons, microwave drying was not considered further for analysis. c. Indirect Heating TABLE IV.5—RETAINED DESIGN OPTIONS FOR CONSUMER CLOTHES DRYERS lotter on DSK11XQN23PROD with PROPOSALS2 Dryer Control or Drum Upgrades: Improved termination. Modified operating conditions. Improved air circulation. Increased insulation. Improved drum design. Methods of Exhaust Heat Recovery (vented models only): Recycle exhaust heat. Inlet air preheat. Inlet air preheat, condensing mode. Moisture Removal Options: Heat pump, electric only. Modulating heat. Component Improvements: Improved motor efficiency. Improved fan efficiency. Standby Power Improvements: Transformerless Power Supply with Auto-Powerdown. DOE has initially determined that these technology options are technologically feasible because they are being used or have previously been used in commercially-available products or working prototypes. DOE also finds that all of the remaining technology options meet the other screening criteria (i.e., practicable to manufacture, install, and service and do not result in adverse impacts on consumer utility, product availability, health, or safety, nor are unique-pathway proprietary technologies). For additional details, see chapter 4 of the NOPR TSD. 25 CoolDry does not specify the metric or test method used to determine the efficiency of its prototype. More information is available at: https:// www.cooldryrf.com/. 26 EF only incorporates active mode energy use and not standby and off mode energy use. 27 Momen, A. Ultrasonic Clothes Dryer: 2016 Building Technologies Office Peer Review. 2016. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 C. Engineering Analysis The purpose of the engineering analysis is to establish the relationship between the efficiency and cost of consumer clothes dryers. There are two elements to consider in the engineering analysis; the selection of efficiency levels to analyze (i.e., the ‘‘efficiency PO 00000 Frm 00020 Fmt 4701 Sfmt 4702 analysis’’) and the determination of product cost at each efficiency level (i.e., the ‘‘cost analysis’’). In determining the performance of higher-efficiency products, DOE considers technologies and design option combinations not eliminated by the screening analysis. For each product class, DOE estimates the baseline cost, as well as the incremental cost for the product at efficiency levels above the baseline. The output of the engineering analysis is a Prepared for the U.S. Department of Energy at Oak Ridge National Laboratory, in partnership with the University of Florida and General Electric. p. 2. E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules set of cost-efficiency ‘‘curves’’ that are used in downstream analyses (i.e., the LCC and PBP analyses and the NIA). 1. Efficiency Analysis DOE typically uses one of two approaches to develop energy efficiency levels for the engineering analysis: (1) relying on observed efficiency levels in the market (i.e., the efficiency-level approach), or (2) determining the incremental efficiency improvements associated with incorporating specific design options to a baseline model (i.e., the design-option approach). Using the efficiency-level approach, the efficiency levels established for the analysis are determined based on the market distribution of existing products (in other words, based on the range of efficiencies and efficiency level ‘‘clusters’’ that already exist on the market). Using the design option approach, the efficiency levels established for the analysis are determined through detailed engineering calculations and/or computer simulations of the efficiency improvements from implementing specific design options that have been identified in the technology assessment. DOE may also rely on a combination of these two approaches. For example, the efficiency-level approach (based on actual products on the market) may be extended using the design option approach to ‘‘gap fill’’ levels (to bridge large gaps between other identified efficiency levels) and/or to extrapolate to the max-tech level (particularly in cases where the max-tech level exceeds the maximum efficiency level currently available on the market). In this proposed rulemaking, DOE relied on an efficiency-level approach, supplemented with reverse-engineering. This approach involved testing and physically disassembling a representative sample of commercially available products, reviewing publicly available cost information, and modeling equipment cost. From this information, DOE estimated the manufacturer production costs (‘‘MPCs’’) for a range of products currently available on the market, considering the design options and the steps manufacturers would likely take to reach a certain efficiency level. As part of this NOPR analysis, DOE included additional test units beyond those considered in the preliminary analysis as part of its updated test sample. The additional test units were included to represent additional baseline models, newly introduced units on the market, units with unique configurations, and units with technologies that were not available at the time of the preliminary analysis. The efficiency levels analyzed as part of this engineering analysis are attainable using commercially available clothes dryer technologies, or technologies that have been demonstrated in working prototypes. a. Baseline Efficiency Levels For each product class, DOE generally selects a baseline model as a reference point for each class, and measures changes resulting from potential energy conservation standards against the baseline. The baseline model in each product class represents the characteristics of a product typical of that class. Generally, a baseline model is one that just meets current energy conservation standards, or, if no standards are in place, the baseline is typically the most common or least efficient unit on the market. The baseline clothes dryer efficiency levels for this NOPR differ from the existing energy conservation standards that were established in the 2011 rulemaking analysis primarily due to the difference between the then-current appendix D1, which DOE used to evaluate products in the previous rulemaking, and the present version of appendix D2, as established by the October 2021 TP Final Rule and which DOE used as the basis for this analysis. Appendix D2 includes test methods that more accurately measure the effects of automatic cycle termination and that may result in differences in the total measured energy consumption of the test cycle as compared to the test methods in appendix D1. Specifically, 51753 for automatic termination control dryers, appendix D2 requires a lower FMC of the test load and does not rely on a field use factor to account for the over drying energy consumption, instead requiring that the automatic termination drying program run to the end of the cycle. Additionally, appendix D2 contains instructions for the testing of timer dryers, which include a lower FMC of the test load as compared to the version of appendix D1 used for the 2011 rulemaking analysis. For the engineering analysis, DOE begins the engineering analysis by identifying the efficiency level corresponding to the Federal minimum energy conservation standards for each product class. Due to the test procedure changes adopted in the October 2021 Final Rule, DOE determined the baseline efficiency level representative of minimally compliant products when tested under appendix D2. In order to identify the appendix D2 baseline levels, DOE tested 22 models that were certified as minimally compliant with the current energy conservation standards, from across all product classes. Because certified performance data are not available for models on the market as tested in accordance with both appendix D1 and appendix D2, DOE tested each basic model in its test sample in accordance with appendix D1 and appendix D2 and used the test values for appendix D2 to determine the baseline models in support of this engineering analysis. Due to the differences in the two test procedures described above, the baseline CEFD2 measured using appendix D2 is numerically lower for each product class than the corresponding CEFD1 value in the current energy conservation standards, though that does not indicate a lower efficiency. The test procedure differences are driving the lower baseline CEFD2 values and do not represent a lower efficiency or backsliding. The consumer clothes dryer baseline efficiency levels for the preliminary analysis are presented in Table IV.6. TABLE IV.6—PRELIMINARY ANALYSIS CONSUMER CLOTHES DRYER BASELINE EFFICIENCY LEVELS CEFD2 (lb/kWh) lotter on DSK11XQN23PROD with PROPOSALS2 Product class Vented Electric, Standard (4.4 ft3 or greater capacity) ....................................................................................................................... Vented Electric, Compact (120V) (less than 4.4 ft3 capacity) ............................................................................................................ Vented Electric, Compact (240V) (less than 4.4 ft3 capacity) ............................................................................................................ Vented Gas, Standard (4.4 cubic ft3 or greater capacity) ................................................................................................................... Vented Gas, Compact (less than 4.4 ft3 capacity) .............................................................................................................................. Ventless Electric, Compact (240V) (less than 4.4 ft3 capacity) .......................................................................................................... Ventless Electric, Standard ((4.4 ft3 or greater capacity) ................................................................................................................... Ventless Electric, Combination Washer-Dryer .................................................................................................................................... VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00021 Fmt 4701 Sfmt 4702 E:\FR\FM\23AUP2.SGM 23AUP2 2.20 2.42 2.00 2.63 1.66 2.03 2.23 2.27 51754 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules In response to the preliminary analysis, AHAM agreed that testing was appropriate to determine the baseline and incremental efficiency levels, but stated that the testing of 18 models was insufficient to establish the baseline efficiency levels. AHAM also stated that basing DOE’s analysis on a few baseline units may not accurately represent the market, especially when so many baseline models have electromechanical controls. AHAM therefore requested that DOE make its test results available so that representativeness could be assessed from a shipments perspective, and so that manufacturers could evaluate the test results for their models and compare to their own results. (AHAM, No. 23 at p. 3) Upon request, DOE provided to individual manufacturers the test data for any of their units which were included in DOE’s testing sample, otherwise maintaining confidentiality of the products tested. DOE also increased the number of units included in its updated test sample to better represent consumer clothes dryers currently available on the market, as discussed in chapter 5 of the NOPR TSD. The California IOUs recommended that DOE revise the engineering analysis and investigate lowering the baseline efficiency of the vented gas standard dryer product class. According to the California IOUs, their testing data that were presented to DOE in response to the test procedure NOPR that was published on July 23, 2019 (84 FR 35484), support the baseline efficiency level for the vented electric standard product class. However, for the vented gas standard product class, the California IOUs referred to a currently available product with a CEFD2 value below the baseline efficiency level presented in the preliminary TSD. NEEA asserted that DOE has historically set standard levels for gas clothes dryers lower than the standards for electric clothes dryers because some energy counted in the higher heating value of the gas consumed, which is the basis of the CEFD2, is not used by the consumer clothes dryer. NEEA encouraged DOE to re-evaluate the CEFD2 levels of electric and gas clothes dryers in its engineering analysis, as it pointed out that the electric clothes dryer efficiency levels are lower than the efficiency levels for gas clothes dryers that incorporate similar technology options. NEEA encouraged DOE to increase the stringency of the electric clothes dryer efficiency levels. (California IOUs, No. 26 at pp. 1–3; NEEA, No. 30 at pp. 13– 14) Additionally, NEEA submitted test data for 41 standard size electric and gas clothes dryers, which suggested that the average CEFD2 values for the nonENERGY STAR-qualified electric and gas clothes dryers in its sample were significantly higher than the baseline efficiency levels in the preliminary analysis. NEEA also found that the least efficient electric clothes dryer in its sample had a measured CEFD2 that was more than 20 percent higher than DOE’s value for electromechanically controlled consumer clothes dryers. NEEA encouraged DOE to use these data in developing appropriate efficiency levels for the engineering analysis. (NEEA, No. 30 at pp. 8–10) DOE appreciates the data provided by NEEA and observes that, in general, the data support the historical trend regarding the lower efficiency of gas clothes dryers in comparison to electric clothes dryers. These data also support the updated baseline and incremental efficiency levels for gas clothes dryers, that latter of which are discussed in more detail in section IV.C.1.b of this document. Although the results of NEEA’s test sample exhibit a higher average efficiency among baseline electromechanically controlled electric clothes dryers, as stated above, DOE set the baseline efficiency levels so that they would represent a minimally compliant, basic-construction consumer clothes dryer on the market. Accordingly, DOE has updated the baseline value for each product class to be equal to the minimum CEFD2, measured using appendix D2, among the corresponding consumer clothes dryers in its NOPR test sample. Similarly, DOE notes that the baseline efficiency level for the vented electric compact (120V) product class has been updated to reflect the CEFD2 value using the appendix D2 test procedure based on the best available data at this time. Finally, DOE has considered the revised product classes proposed in this NOPR analysis in updating the baseline efficiency levels, based on further analysis of results and new testing since the preliminary analysis. The baseline efficiency levels considered for this NOPR analysis are presented along with the current standards in Table IV.7 and are discussed in more detail in chapter 5 of the NOPR TSD. TABLE IV.7—NOTICE OF PROPOSED RULEMAKING CONSUMER CLOTHES DRYER BASELINE EFFICIENCY LEVELS CEFD1 (lb/kWh) Product class Electric, Standard (4.4 ft3 or greater capacity) ........................................................................................................ Electric, Compact (120V) (less than 4.4 ft3 capacity) ............................................................................................. Vented Electric, Compact (240V) (less than 4.4 ft3 capacity) ................................................................................ Vented Gas, Standard (4.4 cubic ft3 or greater capacity) ....................................................................................... Vented Gas, Compact (less than 4.4 ft3 capacity) .................................................................................................. Ventless Electric, Compact (240V) (less than 4.4 ft3 capacity) .............................................................................. Ventless Electric, Combination Washer-Dryer ........................................................................................................ 3.73 3.61 3.27 3.30 3.30 2.55 2.08 CEFD2 (lb/kWh) * 2.20 2.36 2.00 2.00 ** 1.66 2.03 2.27 lotter on DSK11XQN23PROD with PROPOSALS2 * As discussed above, the baseline CEFD2 values represent differences in test procedure between appendix D1 and appendix D2 and do not constitute backsliding. ** CEFD2 baseline efficiency levels as measured under the Appendix D2 account for differences in the effectiveness of automatic cycle termination. Manufacturers implement automatic termination in a variety of ways, which will impact the representations as measured under Appendix D2 resulting in a range of possible CEFD2 values, as compared to the same CEFD1 values in the existing Federal standards. b. Incremental Efficiency Levels DOE developed incremental efficiency levels by reviewing products currently available on the market and by testing and reverse engineering products in the DOE test sample in support of the NOPR. For each product class, DOE VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 analyzed several efficiency levels and determined the incremental MPC at each of these levels. DOE initially reviewed data in DOE’s CCD to evaluate the range of efficiencies for consumer clothes dryers currently available on the PO 00000 Frm 00022 Fmt 4701 Sfmt 4702 market.28 As discussed in chapter 5 of the NOPR TSD, non-ENERGY STARqualified products (generally units with lower rated efficiencies) are typically 28 DOE’s Compliance Certification Database is available for review at www.regulations.doe.gov/ certification-data/#q=Product_Group_s%3A*. E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules tested using appendix D1, while ENERGY STAR-qualified products are required to be tested using appendix D2. As a result, DOE conducted testing on a representative sample of non-ENERGY STAR products using appendix D2 to determine appropriate initial incremental efficiency levels for each product class. DOE observed that while electronic controls are typically implemented with other design options in this NOPR analysis, the improved automatic termination precision offered by switching to electronic controls contributed significantly to an increase in efficiency. This efficiency gain informed the first incremental efficiency levels for most product classes and was noted simply as electronic controls in the design options listed in the following tables. The design options associated with higher efficiency levels were subsequently distinguished according to specific design options DOE found manufacturers used to meet these higher efficiencies. As part of 51755 DOE’s analysis, the maximum available efficiency level is defined by the highest efficiency unit currently available on the market. DOE also defines a ‘‘maxtech’’ efficiency level to represent the maximum possible efficiency for a given product. The incremental efficiency levels developed in the preliminary analysis are presented in Table IV.8 through Table IV.15. TABLE IV.8—PRELIMINARY ANALYSIS: VENTED ELECTRIC STANDARD EFFICIENCY LEVELS CEFD2 (lb/kWh) Level Design option Baseline ......................... 1 ..................................... 2 ..................................... 3 ..................................... 4 ..................................... 5 ..................................... 6 ..................................... Baseline (Electromechanical Controls) ................................................................................................... Baseline + Electronic Controls ................................................................................................................ EL1 + Optimized Heating System ........................................................................................................... EL2 + More Advanced Automatic Termination Control System ............................................................. EL3 + Modulating (2-Stage) Heat ........................................................................................................... EL4 + Inlet Air Preheat ........................................................................................................................... Heat Pump Dryer (Max-Tech) ................................................................................................................. 2.20 2.68 3.04 3.27 3.93 4.21 4.30 TABLE IV.9—PRELIMINARY ANALYSIS: VENTED ELECTRIC COMPACT (120V) EFFICIENCY LEVELS CEFD2 (lb/kWh) Level Design option Baseline ......................... 1 ..................................... 2 ..................................... 3 ..................................... 4 ..................................... 5 ..................................... 6 ..................................... Baseline (Electromechanical Controls) ................................................................................................... Baseline + Electronic Controls ................................................................................................................ EL1 + Optimized Heating System ........................................................................................................... EL2 + More Advanced Automatic Termination Control System ............................................................. EL3 + Modulating (2-Stage) Heat ........................................................................................................... EL4 + Inlet Air Preheat ........................................................................................................................... Heat Pump Dryer (Max-Tech) ................................................................................................................. 2.42 2.95 3.35 4.28 4.33 4.63 4.73 TABLE IV.10—PRELIMINARY ANALYSIS: VENTED ELECTRIC COMPACT (240V) EFFICIENCY LEVELS CEFD2 (lb/kWh) Level Design option Baseline ......................... 1 ..................................... 2 ..................................... 3 ..................................... 4 ..................................... 5 ..................................... 6 ..................................... Baseline (Electromechanical Controls) ................................................................................................... Baseline + Electronic Controls ................................................................................................................ EL1 + Optimized Heating System ........................................................................................................... EL2 + More Advanced Automatic Termination Control System ............................................................. EL3 + Modulating (2-Stage) Heat ........................................................................................................... EL4 + Inlet Air Preheat ........................................................................................................................... Heat Pump Dryer (Max-Tech) ................................................................................................................. 2.00 2.44 2.76 3.53 3.57 3.82 2.91 lotter on DSK11XQN23PROD with PROPOSALS2 TABLE IV.11—PRELIMINARY ANALYSIS: VENTED GAS STANDARD EFFICIENCY LEVELS CEFD2 (lb/kWh) Level Design option Baseline ......................... 1 ..................................... 2 ..................................... 3 ..................................... 4 ..................................... Baseline (Electromechanical Controls) ................................................................................................... Baseline + Electronic Controls ................................................................................................................ EL1 + Optimized Heating System and More Advanced Automatic Termination Control System ......... EL2 + Modulating (2-Stage) Heat ........................................................................................................... EL3 + Inlet Air Preheat (Max-Tech) ........................................................................................................ 2.63 3.21 3.48 4.70 5.04 TABLE IV.12—PRELIMINARY ANALYSIS: VENTED GAS COMPACT EFFICIENCY LEVELS CEFD2 (lb/kWh) Level Design option Baseline ......................... 1 ..................................... 2 ..................................... Baseline (Electromechanical Controls) ................................................................................................... Baseline + Electronic Controls ................................................................................................................ EL1 + Optimized Heating System and More Advanced Automatic Termination Control System ......... VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00023 Fmt 4701 Sfmt 4702 E:\FR\FM\23AUP2.SGM 23AUP2 1.66 2.02 2.19 51756 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules TABLE IV.12—PRELIMINARY ANALYSIS: VENTED GAS COMPACT EFFICIENCY LEVELS—Continued CEFD2 (lb/kWh) Level Design option 3 ..................................... 4 ..................................... EL2 + Modulating (2-Stage) Heat ........................................................................................................... EL3 + Inlet Air Preheat (Max-Tech) ........................................................................................................ 2.96 3.17 TABLE IV.13—PRELIMINARY ANALYSIS: VENTLESS ELECTRIC STANDARD EFFICIENCY LEVELS CEFD2 (lb/kWh) Level Design option Baseline ......................... 1 ..................................... 2 ..................................... Baseline (Electronic Controls) ................................................................................................................. Baseline + More Advanced Automatic Termination Control System ..................................................... Heat Pump Dryer (Max-Tech) ................................................................................................................. 2.23 2.95 4.50 TABLE IV.14—PRELIMINARY ANALYSIS: VENTLESS ELECTRIC COMPACT (240V) EFFICIENCY LEVELS CEFD2 (lb/kWh) Level Design option Baseline ......................... 1 ..................................... 2 ..................................... Baseline (Electronic Controls) ................................................................................................................. Baseline + More Advanced Automatic Termination Control System ..................................................... Heat Pump Dryer (Max-Tech) ................................................................................................................. 2.03 2.68 5.70 lotter on DSK11XQN23PROD with PROPOSALS2 TABLE IV.15—PRELIMINARY ANALYSIS: VENTLESS ELECTRIC COMBINATION WASHER-DRYER EFFICIENCY LEVELS CEFD2 (lb/kWh) Level Design option Baseline ......................... 1 ..................................... 2 ..................................... Baseline (Electronic Controls) ................................................................................................................. Baseline + High Speed Spin ................................................................................................................... Heat Pump Dryer (Max-Tech) ................................................................................................................. DOE received comments regarding the hybrid heat pump design investigated in a 2016 study by Pacific Northwest National Laboratory (‘‘PNNL’’), which utilizes a low-wattage electric resistance heater located downstream of the condenser to provide supplementary heating to minimize drying cycle time.29 ASAP and NRDC encouraged DOE to review the max-tech level and heat pump technology design option based on current hybrid heat pump models available and the PNNL prototype hybrid heat pump clothes dryer which utilized a recuperative heat exchanger in addition to a resistive heating element and heat pump design. (ASAP, NRDC, No. 25 at p. 2) At the time of the preliminary analysis, DOE was not aware of the efficiency impacts associated with consumer clothes dryers utilizing a hybrid heat pump design and therefore did not include this design as part of the preliminary analysis. In the time since the publishing of the preliminary analysis, DOE has identified at least two manufacturers that market consumer clothes dryers utilizing a hybrid heat pump design. DOE investigated the 29 See: www.pnnl.gov/main/publications/ external/technical_reports/PNNL-25510.pdf. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 efficiency savings associated with hybrid heat pump clothes dryers and included in its updated test sample two hybrid heat pump clothes dryers. DOE observed that, compared to heat pumponly clothes dryer designs, the hybrid heat pump clothes dryers had lower efficiencies, albeit higher than the efficiencies of any non-heat pump clothes dryer. This analysis indicates that use of hybrid heat pump technology may provide a ‘‘bridge’’ in the market between consumer clothes dryer models utilizing conventional heating elements and models based on heat pump-only technology. Therefore, in this NOPR, DOE analyzed an intermediate efficiency level associated with the hybrid heat pump technology that would capture the efficiency savings from consumer clothes dryers implementing a conventional heating element in addition to heat pump technology. The efficiency savings associated with heat recovery are still captured in the efficiency levels modeling inlet air preheat. ASAP, NRDC, the California IOUs, and NEEA requested that DOE review the consumer clothes dryers currently available on the market, asserting that at the time of publication of the preliminary analysis, there were models PO 00000 Frm 00024 Fmt 4701 Sfmt 4702 2.27 2.55 5.42 available with higher efficiency than the preliminary max-tech levels in the ventless electric standard and compact product classes. (ASAP, NRDC, No. 25 at pp. 1–2; California IOUs, No. 26 at pp. 3–4; NEEA, No. 30 at pp. 10–11) DOE reviewed the highest efficiency ventless clothes dryers on the market by examining DOE’s Compliance Certification Management System database (‘‘CCMS’’) and ENERGY STAR databases and included a sample of them in the updated test sample to better represent the max-tech levels in the proposed electric standard, electric compact (120V), and ventless electric compact (240V) product classes. Chapter 5 of the NOPR TSD discusses the incremental efficiency levels for each of the product classes proposed in this NOPR analysis. The revised CEFD2 efficiency levels for each product class are shown below in Table IV.16 through Table IV.21, along with the current energy conservation standards in CEFD1 for comparison. As discussed in section IV.C.1.a of this document, the baseline CEFD2 values estimated for the preliminary analysis are lower than the current CEFD1 values in the energy conservation standards due to the differences in testing using appendix D1 and appendix D2. DOE requests E:\FR\FM\23AUP2.SGM 23AUP2 51757 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules comment on the incremental efficiency levels used in the NOPR engineering analysis. levels used in the NOPR engineering analysis. TABLE IV.16—NOTICE OF PROPOSED RULEMAKING ANALYSIS: ELECTRIC STANDARD EFFICIENCY LEVELS Efficiency level Design option Current standard CEFD1 (lb/kWh) Baseline ............................ 1 ........................................ 2 ........................................ 3 ........................................ 4 ........................................ 5 ........................................ 6 ........................................ 7 ........................................ Baseline (Electromechanical Controls) .................................................................... Baseline + Electronic Controls ................................................................................. EL1 + Optimized Heating System ........................................................................... EL2 + More Advanced Automatic Termination Control System .............................. EL3 + Modulating (2-Stage) Heat ............................................................................ EL4 + Inlet Air Preheat ............................................................................................ Hybrid Heat Pump Dryer (Additional Resistance Heater) ....................................... Heat Pump Dryer (Max-Tech) .................................................................................. 3.73 ........................ ........................ ........................ ........................ ........................ ........................ ........................ NOPR CEFD2 (lb/kWh) * 2.20 2.68 3.04 3.27 3.93 4.21 5.20 30 7.39 * As discussed above, the baseline CEFD2 values represent differences in test procedure between Appendix D1 and Appendix D2 and do not constitute backsliding. TABLE IV.17—NOTICE OF PROPOSED RULEMAKING ANALYSIS: ELECTRIC COMPACT (120V) EFFICIENCY LEVELS Efficiency level Design option Current standard CEFD1 (lb/kWh) Baseline ............................ 1 ........................................ 2 ........................................ 3 ........................................ 4 ........................................ 5 ........................................ 6 ........................................ Baseline (Electromechanical Controls) .................................................................... Baseline + Electronic Controls ................................................................................. EL1 + Optimized Heating System ........................................................................... EL2 + More Advanced Automatic Termination Control System .............................. EL3 + Modulating (2-Stage) Heat ............................................................................ EL4 + Inlet Air Preheat ............................................................................................ Heat Pump Dryer (Max-Tech) .................................................................................. 3.61 ........................ ........................ ........................ ........................ ........................ ........................ NOPR CEFD2 (lb/kWh) 2.36 3.15 3.35 4.28 4.33 4.63 6.37 TABLE IV.18—NOTICE OF PROPOSED RULEMAKING ANALYSIS: VENTED ELECTRIC COMPACT (240V) EFFICIENCY LEVELS Efficiency level Design option Current standard CEFD1 (lb/kWh) Baseline ............................ 1 ........................................ 2 ........................................ 3 ........................................ 4 ........................................ 5 ........................................ 6 ........................................ Baseline (Electromechanical Controls) .................................................................... Baseline + Electronic Controls ................................................................................. EL1 + Optimized Heating System ........................................................................... EL2 + More Advanced Automatic Termination Control System .............................. EL3 + Modulating (2-Stage) Heat ............................................................................ EL4 + Inlet Air Preheat ............................................................................................ Heat Pump Dryer (Max-Tech) .................................................................................. 3.27 ........................ ........................ ........................ ........................ ........................ ........................ NOPR CEFD2 (lb/kWh) 2.00 2.44 2.76 3.30 3.57 3.82 3.91 TABLE IV.19—NOTICE OF PROPOSED RULEMAKING ANALYSIS: VENTED GAS STANDARD AND COMPACT EFFICIENCY LEVELS Efficiency level lotter on DSK11XQN23PROD with PROPOSALS2 Baseline ...................... 1 .................................. 2 .................................. 3 .................................. 4 .................................. Design option Baseline (Electromechanical Controls) .............................................. Baseline + Electronic Controls ........................................................... EL1 + Optimized Heating System and More Advanced Automatic Termination Control System. EL2 + Modulating (2-Stage) Heat ...................................................... EL3 + Inlet Air Preheat (Max-Tech) ................................................... 30 DOE is aware of clothes dryers in the electric standard product class that perform at higher efficiencies than the proposed max-tech level, but those models are not representative of the typical VerDate Sep<11>2014 Current standard CEFD1 (lb/kWh) 31 19:56 Aug 22, 2022 Jkt 256001 capacity in the electric standard product class. Therefore, based on the certified performance of those models and additional investigative testing, DOE determined a representative max-tech PO 00000 Frm 00025 Fmt 4701 Sfmt 4702 NOPR CEFD2 (lb/kWh) Vented gas standard Vented gas compact 3.30 ........................ ........................ 2.00 2.44 3.00 1.66 2.02 2.49 ........................ ........................ 3.48 3.83 2.89 3.17 efficiency for the electric standard product class that reflects an appropriate, representative unit capacity. See chapter 5 of the TSD for more information. E:\FR\FM\23AUP2.SGM 23AUP2 51758 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules TABLE IV.20—NOTICE OF PROPOSED RULEMAKING ANALYSIS: VENTLESS ELECTRIC COMPACT (240V) EFFICIENCY LEVELS Efficiency level Design option Current standard CEFD1 (lb/kWh) Baseline ............................ 1 ........................................ 2 ........................................ Baseline (Electronic Controls) .................................................................................. Baseline + More Advanced Automatic Termination Control System ...................... Heat Pump Dryer (Max-Tech) .................................................................................. 2.55 ........................ ........................ NOPR CEFD2 (lb/kWh) 2.03 2.68 6.80 TABLE IV.21—NOTICE OF PROPOSED RULEMAKING ANALYSIS: VENTLESS ELECTRIC COMBINATION WASHER-DRYER EFFICIENCY LEVELS Efficiency level Design option Current standard CEFD1 (lb/kWh) Baseline ............................ 1 ........................................ 2 ........................................ Baseline (Electronic Controls) .................................................................................. Baseline + High Speed Spin .................................................................................... Heat Pump Dryer (Max-Tech) .................................................................................. 2.08 ........................ ........................ 2. Cost Analysis The cost analysis portion of the engineering analysis is conducted using one or a combination of cost approaches. The selection of cost approach depends on a suite of factors, including the availability and reliability of public information, characteristics of the regulated product, the availability and timeliness of purchasing the product on the market. The cost approaches are summarized as follows: • Physical teardowns: Under this approach, DOE physically dismantles a commercially available product, component-by-component, to develop a detailed bill of materials (‘‘BOM’’) for the product. • Catalog teardowns: In lieu of physically deconstructing a product, DOE identifies each component using parts diagrams (available from manufacturer websites or appliance repair websites, for example) to develop the BOM for the product. • Price surveys: If neither a physical nor catalog teardown is feasible (for example, for tightly integrated products such as fluorescent lamps, which are infeasible to disassemble and for which parts diagrams are unavailable) or costprohibitive and otherwise impractical (e.g. large commercial boilers), DOE conducts price surveys using publicly available pricing data published on major online retailer websites and/or by soliciting prices from distributors and other commercial channels. In the present case, DOE conducted the analysis using physical product teardowns to determine the baseline MPC for each product class as outlined in chapter 5 of the NOPR TSD. DOE developed the cost-efficiency relationships for each product class as discussed in section IV.C.3 of this document. DOE developed incremental MPCs based on product teardowns and manufacturing cost modeling of the expected design changes at each efficiency level. DOE observed that the basic product designs of vented electric and vented gas clothes dryers are similar except for the heating system. DOE also observed that the technology designs of standard size and compact size clothes dryers are similar as well, simply scaled in size. As a result, in the absence of models available on the market at certain efficiency levels for NOPR CEFD2 (lb/kWh) 2.27 2.55 4.01 certain product classes, DOE estimated the incremental MPC for these based on the same design changes observed for the electric standard product class. DOE updated the cost-efficiency analysis from the preliminary analysis by updating the costs of raw materials and purchased components, as well as updating costs for manufacturing equipment, labor, and depreciation. DOE also used information from teardown of units in the updated test sample to inform updates to the costefficiency analysis. Not all units in the updated test sample were torn down; DOE focused on units recently introduced in the market, units with unique configuration, and units with technologies that were not available at the time of the preliminary analysis to better inform the costs associated with particular product classes and design options. The resulting BOMs provided the basis for the MPC estimates in this NOPR. The baseline MPCs for each consumer clothes dryer product class are listed in Table IV.22, with all costs presented in 2020 dollars. DOE requests comment on the baseline MPCs in the NOPR engineering analysis. TABLE IV.22—NOTICE OF PROPOSED RULEMAKING: CONSUMER CLOTHES DRYER BASELINE MANUFACTURING PRODUCTION COSTS Baseline MPC (2020$) lotter on DSK11XQN23PROD with PROPOSALS2 Product class 1. 2. 3. 4. 5. Electric, Standard (4.4 cubic feet (ft3) or greater capacity) ............................................................................................................ Electric, Compact (120 volts (V)) (less than 4.4 ft3 capacity) ......................................................................................................... Vented Electric, Compact (240V) (less than 4.4 ft3 capacity) ........................................................................................................ Gas, Standard (4.4 cubic ft3 or greater capacity) ........................................................................................................................... Gas, Compact (less than 4.4 ft3 capacity) ...................................................................................................................................... 31 The current standard does not distinguish a separate product class for compact sized gas VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 consumer clothes dryers. As such, the current PO 00000 Frm 00026 Fmt 4701 Sfmt 4702 $250.65 267.09 267.68 284.33 309.82 standard may apply to all gas consumer clothes dryers. E:\FR\FM\23AUP2.SGM 23AUP2 51759 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules TABLE IV.22—NOTICE OF PROPOSED RULEMAKING: CONSUMER CLOTHES DRYER BASELINE MANUFACTURING PRODUCTION COSTS—Continued Baseline MPC (2020$) Product class 6. Ventless Electric, Compact (240V) (less than 4.4 ft3 capacity) ...................................................................................................... 7. Electric, Combination Washer-Dryer ............................................................................................................................................... The following section presents the incremental MPCs for each consumer clothes dryer product class. 3. Cost-Efficiency Results The results of the engineering analysis are presented as cost-efficiency data for each of the efficiency levels for each of the product classes that were analyzed, as well as those extrapolated from a product class with similar features. DOE developed estimates of MPCs for each unit in the teardown sample to develop a comprehensive set of incremental MPCs (i.e., the additional costs manufacturers would likely incur by producing consumer clothes dryers at each efficiency level compared to the baseline). In response to the MPCs presented in the preliminary analysis, AHAM stated that due to unprecedented supply chain issues facing home appliance manufacturers resulting from the COVID–19 pandemic and increased tariffs on raw materials, components, and finished goods, DOE must take into account these challenges if it is to consider amending energy conservation standards. AHAM stated it is working to collect data on the impact of supply chain challenges and would be willing to share that data with DOE. (AHAM, No. 23 at p. 9) DOE also received similar feedback from manufacturers during the interview process. DOE notes that increased costs associated with recent 464.90 629.65 supply chain issues have been implemented in the cost analysis and are presented in the MPCs in this NOPR analysis, specifically by way of 5-year moving averages for material and purchase parts prices. The resulting incremental MPCs from this NOPR analysis are provided in Table IV.23 through Table IV.29. See chapter 5 of the NOPR TSD for additional detail on the engineering analysis. DOE requests comment on the incremental MPCs from the NOPR engineering analysis, as well as any data on the impact of supply chain challenges that could better inform the cost analysis. TABLE IV.23—NOTICE OF PROPOSED RULEMAKING ANALYSIS: ELECTRIC STANDARD INCREMENTAL MANUFACTURING PRODUCTION COSTS Efficiency level Design option Incremental MPC (2020$) Baseline ......................... 1 ..................................... 2 ..................................... 3 ..................................... 4 ..................................... 5 ..................................... 6 ..................................... 7 ..................................... Baseline (Electromechanical Controls) ................................................................................................... Baseline + Electronic Controls ................................................................................................................ EL1 + Optimized Heating System ........................................................................................................... EL2 + More Advanced Automatic Termination Control System ............................................................. EL3 + Modulating (2-Stage) Heat ........................................................................................................... EL4 + Inlet Air Preheat ........................................................................................................................... Hybrid Heat Pump Dryer (Additional Resistive Heater) ......................................................................... Heat Pump Dryer (Max-Tech) ................................................................................................................. ........................ $11.02 13.70 16.59 21.00 70.51 226.18 239.46 lotter on DSK11XQN23PROD with PROPOSALS2 TABLE IV.24—NOTICE OF PROPOSED RULEMAKING ANALYSIS: ELECTRIC COMPACT (120V) INCREMENTAL MANUFACTURING PRODUCTION COSTS Efficiency level Design option Incremental MPC (2020$) Baseline ......................... 1 ..................................... 2 ..................................... 3 ..................................... 4 ..................................... 5 ..................................... 6 ..................................... Baseline (Electromechanical Controls) ................................................................................................... Baseline + Electronic Controls ................................................................................................................ EL1 + Optimized Heating System ........................................................................................................... EL2 + More Advanced Automatic Termination Control System ............................................................. EL3 + Modulating (2-Stage) Heat ........................................................................................................... EL4 + Inlet Air Preheat ........................................................................................................................... Heat Pump Dryer (Max-Tech) ................................................................................................................. ........................ $13.43 17.76 21.40 26.32 83.07 220.29 TABLE IV.25—NOTICE OF PROPOSED RULEMAKING ANALYSIS: VENTED ELECTRIC COMPACT (240V) INCREMENTAL MANUFACTURING PRODUCTION COSTS Efficiency level Design option Incremental MPC (2020$) Baseline ......................... 1 ..................................... 2 ..................................... Baseline (Electromechanical Controls) ................................................................................................... Baseline + Electronic Controls ................................................................................................................ EL1 + Optimized Heating System ........................................................................................................... ........................ $13.99 18.31 VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00027 Fmt 4701 Sfmt 4702 E:\FR\FM\23AUP2.SGM 23AUP2 51760 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules TABLE IV.25—NOTICE OF PROPOSED RULEMAKING ANALYSIS: VENTED ELECTRIC COMPACT (240V) INCREMENTAL MANUFACTURING PRODUCTION COSTS—Continued Efficiency level 3 4 5 6 ..................................... ..................................... ..................................... ..................................... Incremental MPC (2020$) Design option EL2 + More Advanced Automatic Termination Control System ............................................................. EL3 + Modulating (2-Stage) Heat ........................................................................................................... EL4 + Inlet Air Preheat ........................................................................................................................... Heat Pump Dryer (Max-Tech) ................................................................................................................. 21.97 26.88 83.63 220.84 TABLE IV.26—NOTICE OF PROPOSED RULEMAKING ANALYSIS: VENTED GAS STANDARD INCREMENTAL MANUFACTURING PRODUCTION COSTS Efficiency level Design option Incremental MPC (2020$) Baseline ......................... 1 ..................................... 2 ..................................... 3 ..................................... 4 ..................................... Baseline (Electromechanical Controls) ................................................................................................... Baseline + Electronic Controls ................................................................................................................ EL1 + Optimized Heating System and More Advanced Automatic Termination Control System ......... EL2 + Modulating (2-Stage) Heat ........................................................................................................... EL3 + Inlet Air Preheat (Max-Tech) ........................................................................................................ ........................ $14.50 17.46 26.75 76.25 TABLE IV.27—NOTICE OF PROPOSED RULEMAKING ANALYSIS: VENTED GAS COMPACT INCREMENTAL MANUFACTURING PRODUCTION COSTS Efficiency level Design option Incremental MPC (2020$) Baseline ......................... 1 ..................................... 2 ..................................... 3 ..................................... 4 ..................................... Baseline (Electromechanical Controls) ................................................................................................... Baseline + Electronic Controls ................................................................................................................ EL1 + Optimized Heating System and More Advanced Automatic Termination Control System ......... EL2 + Modulating (2-Stage) Heat ........................................................................................................... EL3 + Inlet Air Preheat (Max-Tech) ........................................................................................................ ........................ $12.32 16.49 26.97 83.72 TABLE IV.28—NOTICE OF PROPOSED RULEMAKING ANALYSIS: VENTLESS ELECTRIC COMPACT (240V) INCREMENTAL MANUFACTURING PRODUCTION COSTS Efficiency level Design option Incremental MPC (2020$) Baseline ......................... 1 ..................................... 2 ..................................... Baseline (Electronic Controls) ................................................................................................................. Baseline + More Advanced Automatic Termination Control System ..................................................... Heat Pump Dryer (Max-Tech) ................................................................................................................. ........................ $3.01 184.11 lotter on DSK11XQN23PROD with PROPOSALS2 TABLE IV.29—NOTICE OF PROPOSED RULEMAKING ANALYSIS: VENTLESS ELECTRIC COMBINATION WASHER-DRYER INCREMENTAL MANUFACTURING PRODUCTION COSTS Efficiency level Design option Incremental MPC (2020$) Baseline ......................... 1 ..................................... 2 ..................................... Baseline (Electronic Controls) ................................................................................................................. Baseline + High Speed Spin ................................................................................................................... Heat Pump Dryer (Max-Tech) ................................................................................................................. ........................ $0.00 383.58 D. Markups Analysis The markups analysis develops appropriate markups (e.g., retailer markups, distributor markups, contractor markups) in the distribution chain and sales taxes to convert the manufacturer selling price (‘‘MSP’’) estimates derived in the engineering analysis to consumer prices, which are VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 then used in the LCC and PBP analysis. At each step in the distribution channel, companies mark up the price of the product to cover costs. Before developing mark-ups, DOE defines key market participants and identifies distribution channels. PO 00000 Frm 00028 Fmt 4701 Sfmt 4702 For consumer clothes dryers, the main parties in the distribution chain are retailers. DOE developed baseline and incremental markups for each actor in the distribution chain. Baseline markups are applied to the price of products with baseline efficiency, while incremental markups are applied to the E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules difference in price between baseline and higher-efficiency models (the incremental cost increase). The incremental markup is typically less than the baseline markup and is designed to maintain similar per-unit operating costs before and after new or amended standards.32 DOE relied on economic data from the U.S. Census Bureau to estimate average baseline and incremental markups. Specifically, DOE used the 2017 Annual Retail Trade Survey for the ‘‘electronics and appliance stores’’ sector to develop retailer markups; 33 and the 2017 Annual Wholesale Trade Survey for the ‘‘household appliances, and electrical and electronic goods merchant wholesalers’’ to estimate wholesaler markups.34 Chapter 6 of the NOPR TSD provides details on DOE’s development of markups for consumer clothes dryers. lotter on DSK11XQN23PROD with PROPOSALS2 E. Energy Use Analysis The purpose of the energy use analysis is to determine the annual energy consumption of consumer clothes dryers at different efficiencies in representative U.S. single-family homes, multi-family residences, and mobile homes, and to assess the energy savings potential of increased consumer clothes dryer efficiency. The energy use analysis estimates the range of energy use of consumer clothes dryers in the field (i.e., as they are actually used by consumers). The energy use analysis provides the basis for other analyses DOE performed, particularly assessments of the energy savings and the savings in consumer operating costs that could result from adoption of amended or new standards. To establish a reasonable range of energy consumption in the field for consumer clothes dryers, DOE primarily used data from the EIA’s 2015 Residential Energy Consumption Survey (‘‘2015 RECS’’).35 2015 RECS collected 32 Because the projected price of standardscompliant products is typically higher than the price of baseline products, using the same markup for the incremental cost and the baseline cost would result in higher per-unit operating profit. While such an outcome is possible, DOE maintains that in markets that are reasonably competitive it is unlikely that standards would lead to a sustainable increase in profitability in the long run. 33 US Census Bureau, Annual Retail Trade Survey. 2017. Available at www.census.gov/ programs-surveys/arts.html (last accessed November 17, 2021). 34 US Census Bureau, Annual Wholesale Trade Survey. 2017. Available at www.census.gov/awts (last accessed November 17, 2021). 35 U.S. Department of Energy—Energy Information Administration, Residential Energy Consumption Survey: 2015 Public Use Data Files. Available at www.eia.doe.gov/emeu/recs/ recspubuse15/pubuse15.html (last accessed November 18, 2021). VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 data on 5,686 housing units and was constructed by EIA to be a national representation of the household population in the United States. DOE developed household samples from 2015 RECS.36 DOE divided the sample of households into four sub-samples to characterize the product classes being analyzed: standard or compact clothes dryer using electricity or natural gas as the clothes dryer fuel. For compact clothes dryers, DOE developed a subsample consisting of households with an electric or gas clothes dryer in multifamily buildings, manufactured homes, and single-family homes with less than 1,000 square feet and no garage or basement, since these products are most likely to be found in these housing types. The energy use analysis requires DOE to establish a range of total annual usage (number of cycles) in order to estimate annual energy consumption by a clothes dryer. DOE estimated the number of clothes dryer cycles per year for each sample household using data given by 2015 RECS on the number of laundry loads washed (clothes washer cycles) per week and the frequency of clothes dryer use. AHAM agreed with DOE’s use of the 2015 RECS to establish the annual number of cycles for clothes dryers along with other available national, statistically significant field use data that may be available. (AHAM, No. 23 at pp. 10–11) In contrast, NEEA encouraged DOE to increase the number of annual dryer cycles in its energy analysis or conduct its own field study to more accurately determine this value. NEEA found that the RECS estimate of 243 dryer cycles per year was significantly lower than its own RBSA Laundry Study, which found 311 +/¥42 loads per year for the same group of products, which was based on metering of dryers in the field. NEEA also indicated that the RECS methodology is subject to recall bias and may not be an accurate representation of consumer use. (NEEA, No. 30 at pp. 14–15; Webinar Transcript, No. 22 at pp. 41– 42) ASAP and NRDC encouraged DOE to consider data from the NEEA 2014 Field Study in estimating the number of dryer loads per year. (ASAP, NRDC, No. 25 at p. 2) The RBSA study includes sample households from three states in the U.S. Northwest. Since sample households in 2015 RECS are nationally 36 Microdata of 2020 RECS, which contains household samples, was released in July 2022. Hence it was not available at the time the NOPR analysis was conducted. However, DOE plans to use 2020 RECS for the Final Rule analysis. PO 00000 Frm 00029 Fmt 4701 Sfmt 4702 51761 representative, it is more accurate to use in the analysis. GEA stated that DOE must consider product performance to prevent consumer usage with unintended energy consumption consequences, stating that long cycle times may lead to re-washing or re-drying of clothes. (GEA, No. 28 at pp. 2–3) For this analysis, DOE did not find any studies supporting or indicating an increased usage resulting from cycle times. DOE will consider any new information or data that points to an impact on usage due to a change in cycle times. The California IOUs suggested that updated RECS data be utilized for the final rule analysis. (CA IOUs, No. 26 at p. 6) Data collection for the 2020 RECS are in progress but it is unclear if the data needed to estimate clothes dryer cycles will be available for the final rule analysis. The California IOUs recommended DOE consider the impact of the COVID– 19 pandemic has had as updates are made. The California IOUs encouraged DOE to consider carefully what portions of updated RECS data are representative of current and future use as the updated data may have heavy influences from the COVID–19 pandemic. (CA IOUs, No. 26 at p. 6) Energy Solutions also requested that DOE consider how consumer usage has shifted due to the COVID–19 pandemic. (Webinar Transcript, No. 22 at p. 66) If appropriate data from the 2020 RECS are available for the final rule analysis, DOE will evaluate the extent to which the data may have been affected by changes in dryer usage due to the pandemic. For each considered efficiency level, DOE derived the field energy use by separately estimating the active mode and standby mode energy use and then adding them together. The per-cycle active mode energy consumption is estimated using the DOE clothes dryer test procedure at appendix D2. It can be back-calculated from the test procedure results by dividing the weight (lb) of clothes dried per cycle (8.45 lb for standard and 3 lb for compact clothes dryers) by the CEFD2 (lb/kWh) and subtracting standby power. DOE adjusted the test procedure energy use to reflect field conditions by making an adjustment for clothes dryer load weight and moisture removal factor. Chapter 7 of the NOPR TSD provides more detail about these calculations. DOE also considered the impact of clothes dryer operation on home heating and cooling loads. A clothes dryer releases heat to the surrounding environment. If the clothes dryer is located indoors, its use will tend to E:\FR\FM\23AUP2.SGM 23AUP2 51762 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules lotter on DSK11XQN23PROD with PROPOSALS2 slightly reduce the heating load during the heating season and slightly increase the cooling load during the cooling season. To calculate this impact, DOE first estimated whether the clothes dryer in a RECS sample home is located in conditioned space (referred to as indoors) or in unconditioned space (such as garages, unconditioned basements, outdoor utility closets, or attics). Based on the 2015 RECS and the 2015 American Housing Survey (‘‘AHS’’),37 DOE assumed that 50 percent of vented standard electric and gas clothes dryers are located indoors, while 100 percent of compact and ventless clothes dryers are located indoors. For these installations, DOE utilized the results from a European Union study about the impacts of clothes dryers on home heating and cooling loads to determine the appropriate factor to apply to the total clothes dryer energy use.38 This study reported that for vented clothes dryers there is a factor of negative 3 to 9 percent (average 6 percent), and for ventless clothes dryers there is a factor of positive 7 to 15 percent (average 11 percent).39 This effect is likely to be approximately the same for all of the considered efficiency levels because the amount of air passing through the clothes dryer does not vary. ASAP and NRDC requested that DOE confirm the baseline annual energy use for ventless electric standard dryers, pointing out that while baseline CEFD2 values for vented and ventless models are almost identical, the baseline annual energy consumption for ventless models is almost three times smaller than that for vented models. (ASAP, NRDC, No. 25 at pp. 2–3; ASAP, No. 22 at p. 40) The difference in energy use between vented and ventless models is a function of dryer usage, efficiency, and additional impacts on heating and cooling loads from operating a dryer. DOE has since updated its product classes for electric standard dryers and the update removes the distinction between ventless and vented product classes in this NOPR. DOE proposes an 37 U.S. Census Bureau: Housing and Household Economic Statistics Division, American Housing Survey National Data. 2015, HUD. Available at www.census.gov/programs-surveys/ahs/ data.2015.html (last accessed November 29, 2021). 38 Ru ¨ denauer, I. and C.-O. Gensch, Energy demand of tumble dryers with respect to differences in technology and ambient conditions, January 13, 2004. European Committee of Domestic Equipment Manufacturers (CECED). 39 For units that are located in conditioned space, a negative factor for vented consumer clothes dryers translates to a penalty in energy use whereas a positive factor for ventless consumer clothes dryers translates to a credit in energy use. For details of the calculations see the Ru¨denauer, I. and C.-O. Gensch study referenced above. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 ‘‘Electric Standard’’ product class containing both the vented electric standard product class and the ventless electric standard product class analyzed in the preliminary analysis. See the discussion of product classes in section IV.A.1 of this document. Chapter 7 of the NOPR TSD provides details on DOE’s energy use analysis for consumer clothes dryers. F. Life-Cycle Cost and Payback Period Analysis DOE conducted LCC and PBP analyses to evaluate the economic impacts on individual consumers of potential energy conservation standards for consumer clothes dryers. The effect of new or amended energy conservation standards on individual consumers usually involves a reduction in operating cost and an increase in purchase cost. DOE used the following two metrics to measure consumer impacts: (1) The LCC is the total consumer expense of an appliance or product over the life of that product, consisting of total installed cost (manufacturer selling price, distribution chain markups, sales tax, and installation costs) plus operating costs (expenses for energy use, maintenance, and repair). To compute the operating costs, DOE discounts future operating costs to the time of purchase and sums them over the lifetime of the product. (2) The PBP is the estimated amount of time (in years) it takes consumers to recover the increased purchase cost (including installation) of a moreefficient product through lower operating costs. DOE calculates the PBP by dividing the change in purchase cost at higher efficiency levels by the change in annual operating cost for the year that amended or new standards are assumed to take effect. For any given efficiency level, DOE measures the change in LCC relative to the LCC in the no-new-standards case, which reflects the estimated efficiency distribution of consumer clothes dryers in the absence of new or amended energy conservation standards. In contrast, the PBP for a given efficiency level is measured relative to the baseline product. For each considered efficiency level in each product class, DOE calculated the LCC and PBP for a nationally representative set of housing units. As stated previously, DOE developed household samples from the 2015 RECS.40 For each sample household, DOE determined the energy 40 DOE will update all the data to 2020 RECS if it is available prior to the final rule. PO 00000 Frm 00030 Fmt 4701 Sfmt 4702 consumption for the consumer clothes dryers and the appropriate energy price. By developing a representative sample of households, the analysis captured the variability in energy consumption and energy prices associated with the use of consumer clothes dryers. Inputs to the calculation of total installed cost include the cost of the product—which includes MPCs, manufacturer markups, retailer and distributor markups, and sales taxes— and installation costs. Inputs to the calculation of operating expenses include annual energy consumption, energy prices and price projections, repair and maintenance costs, product lifetimes, and discount rates. DOE created distributions of values for product lifetime, discount rates, and sales taxes, with probabilities attached to each value, to account for their uncertainty and variability. The computer model DOE uses to calculate the LCC and PBP relies on a Monte Carlo simulation to incorporate uncertainty and variability into the analysis. The Monte Carlo simulations randomly sample input values from the probability distributions and consumer clothes dryers user samples. For this rulemaking, the Monte Carlo approach is implemented in MS Excel together with the Crystal BallTM add-on.41 The model calculated the LCC and PBP for products at each efficiency level for 10,000 housing units per simulation run. The analytical results include a distribution of 10,000 data points showing the range of LCC savings for a given efficiency level relative to the nonew-standards case efficiency distribution. In performing an iteration of the Monte Carlo simulation for a given consumer, product efficiency is chosen based on its probability. If the chosen product efficiency is greater than or equal to the efficiency of the standard level under consideration, the LCC and PBP calculation reveals that a consumer is not impacted by the standard level. By accounting for consumers who already purchase more-efficient products, DOE avoids overstating the potential benefits from increasing product efficiency. DOE calculated the LCC and PBP for all consumers of consumer clothes dryers as if each were to purchase a new product in the expected year of required compliance with new or amended standards. Amended standards would 41 Crystal BallTM is commercially-available software tool to facilitate the creation of these types of models by generating probability distributions and summarizing results within Excel. Available at www.oracle.com/technetwork/middleware/ crystalball/overview/ (last accessed November 8, 2021). E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules apply to consumer clothes dryers manufactured 3 years after the date on which any amended standard is published. (42 U.S.C. 6295(m)(4)(A)(i)) At this time, DOE estimates publication of a final rule in 2023. Therefore, for purposes of its analysis, DOE used 2027 as the first year of compliance with any amended standards for consumer clothes dryers. Table IV.30 summarizes the approach and data DOE used to derive inputs to the LCC and PBP calculations. The 51763 subsections that follow provide further discussion. Details of the spreadsheet model, and of all the inputs to the LCC and PBP analyses, are contained in chapter 8 of the NOPR TSD and its appendices. TABLE IV.30—SUMMARY OF INPUTS AND METHODS FOR THE LCC AND PBP ANALYSIS * Inputs Source/method Product Cost ................................... Derived by multiplying MPCs by manufacturer and retailer markups and sales tax, as appropriate. Used historical data to derive a price scaling index to project product costs. Baseline installation cost determined with data from RSMeans Residential Cost Data 2020. Assumed no change with efficiency level. The total per unit energy use multiplied by the cycles per year. Variability: Based on the 2015 RECS (dryer usage), market data on remaining moisture content (‘‘RMC’’) and load weights. Electricity: Based on EEI 2020. Variability: Regional energy prices determined for each Census regions. Based on AEO2021 price projections. Assumed no change with efficiency level for maintenance costs. Repair costs estimated for each product class and efficiency level. Average: 14 years. Approach involves identifying all possible debt or asset classes that might be used to purchase the considered appliances, or might be affected indirectly. Primary data source was the Federal Reserve Board’s Survey of Consumer Finances. 2027. Installation Costs ............................. Annual Energy Use ......................... Energy Prices .................................. Energy Price Trends ....................... Repair and Maintenance Costs ...... Product Lifetime .............................. Discount Rates ................................ Compliance Date ............................ lotter on DSK11XQN23PROD with PROPOSALS2 * References for the data sources mentioned in this table are provided in the sections following the table or in chapter 8 of the NOPR TSD. 1. Product Cost To calculate consumer product costs, DOE multiplied the MPCs developed in the engineering analysis by the markups described previously (along with sales taxes). DOE used different markups for baseline products and higher-efficiency products, because DOE applies an incremental markup to the increase in MSP associated with higher-efficiency products. Economic literature and historical data suggest that the real costs of many products may trend downward over time according to ‘‘learning’’ or ‘‘experience’’ curves. Experience curve analysis implicitly includes factors such as efficiencies in labor, capital investment, automation, materials prices, distribution, and economies of scale at an industry-wide level. To derive the learning rate parameter for consumer clothes dryers, DOE obtained historical Producer Price Index (‘‘PPI’’) data for ‘‘household laundry equipment’’ between 1948 and 2016 and ‘‘major household appliance: primary products’’ between 2016 and 2020 from the Bureau of Labor Statistics (‘‘BLS’’) to form a time series price index representing household laundry equipment from 1948 to 2020.42 42 Household laundry equipment PPI (PCU3352203352204) is available till May 2016, and major household appliance: primary products (PCU335220335220P) is available starting from 2016. See more information at www.bls.gov/ppi/ (last accessed November 29, 2021). VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 Inflation-adjusted price indices were calculated by dividing the PPI series by the gross domestic product index from the Bureau of Economic Analysis for the same years. Using data from 1948–2020, the estimated learning rate (defined as the fractional reduction in price from each doubling of cumulative production) is 14.8 percent. ASAP and NRDC encouraged DOE to investigate how the analysis could reflect learning rates associated with specific technology options for clothes dryers and suggested an approach similar to that taken in the 2017 Final Rule for ceiling fans where DOE estimated a learning rate specific to brushless DC motors. (ASAP, NRDC, No. 25 at p. 4) DOE examined data pertaining to specific technologies, such as the heat pump. However, the heat pump producer price index series starts only from 2010, and the deflated PPI for the limited data does not indicate any observable trend specific to heat pump technology during this limited time series. DOE has therefore not incorporated a learning or experience trend specific to heat pump technology in this analysis. As heat pump technology continues to mature and gain market share over time, DOE expects that ‘‘learning’’ or ‘‘experience’’ curves are likely to become relevant to heat pump technology in the future. DOE seeks comment on this approach PO 00000 Frm 00031 Fmt 4701 Sfmt 4702 and how product costs for heat pump technology may change over time. 2. Installation Cost Installation cost includes labor, overhead, and any miscellaneous materials and parts needed to install the product. DOE used data from RSMeans Residential Cost Data to estimate the baseline installation cost for consumer clothes dryers.43 DOE estimated that for the new construction market it takes on average a total of one hour to install a clothes dryer, while for the replacement or new owners markets it takes a total of two-and a-half hours to install a clothes dryer (one hour for trip charge, half an hour to remove old clothes dryer, and one hour to install). ASAP and NRDC encouraged DOE to reevaluate the increased installation costs associated with the additional labor hours DOE stated would be required for heat pumps due to their larger dimensions relative to conventional dryers. According to ASAP and NRDC, ENERGY STARcertified heat pump dryers have total volumes of either 18.1 or 18.4 ft3, while most non-heat pump models have total volumes between 17 and 23 ft3, so it does not appear that heat pump dryers have larger dimensions than 43 RSMeans Online Residential Data (2020 Release). Gordian: Greenville, SC. Available at www.rsmeansonline.com/ (last accessed November 8, 2021). E:\FR\FM\23AUP2.SGM 23AUP2 51764 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules conventional dryers. (ASAP, NRDC, No. 25 at p. 3) DOE collected and analyzed retail data of available models of both conventional dryers and dryers with heat pump technology, and found that the dimensions and weight of heat pump dryers are not significantly different from other conventional dryers. DOE has therefore revised its installation cost to not vary based on technology. 3. Annual Energy Consumption For each sampled household, DOE determined the energy consumption for a consumer clothes dryer at different efficiency levels using the approach described previously in section IV.E of this document. 4. Energy Prices lotter on DSK11XQN23PROD with PROPOSALS2 Because marginal electricity and gas prices more accurately captures the incremental savings associated with a change in energy use from higher efficiency, they provide a better representation of incremental change in consumer costs than average electricity and gas prices. Therefore, DOE applied average electricity and gas prices for the energy use of the product purchased in the no-new-standards case, and marginal electricity and gas prices for the incremental change in energy use associated with the other efficiency levels considered. DOE derived electricity prices in 2020 using data from Edison Electric Institute (‘‘EEI’’) Typical Bills and Average Rates reports.44 Based upon comprehensive, industry-wide surveys, this semi-annual report presents typical monthly electric bills and average kilowatt-hour costs to the customer as charged by investorowned utilities. DOE calculated residential sector electricity prices using the methodology described in Coughlin and Beraki (2018).45 DOE obtained data for calculating regional prices of natural gas from the EIA publication, Natural Gas Navigator.46 This publication presents monthly volumes of natural gas deliveries and average prices by state for 44 Edison Electric Institute. Typical Bills and Average Rates Report. 2020. Winter 2020, Summer 2020: Washington, DC. 45 Coughlin, K. and B. Beraki.2018. Residential Electricity Prices: A Review of Data Sources and Estimation Methods. Lawrence Berkeley National Lab. Berkeley, CA. Report No. LBNL–2001169. Available at ees.lbl.gov/publications/residentialelectricity-prices-review. 46 U.S. Department of Energy–Energy Information Administration. Natural Gas Navigator 2020. Available at www.eia.gov/naturalgas/data.php (last accessed November 14, 2021). VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 residential, commercial, and industrial customers. DOE’s methodology allows electricity and gas prices to vary by sector, region and season. In the analysis, variability in electricity and gas prices is chosen to be consistent with the way the consumer economic and energy use characteristics are defined in the LCC analysis. For consumer clothes dryers, DOE calculated weighted-average values for average and marginal electricity and gas price for the nine census divisions. See chapter 8 of the NOPR TSD for details. To estimate energy prices in future years, DOE multiplied the 2020 energy prices by the projection of annual average price changes for each of the nine census divisions from the Reference case in AEO2021, which has an end year of 2050.47 To estimate price trends after 2050, DOE used the average annual rate of change in prices from 2040 through 2050. 5. Maintenance and Repair Costs Repair costs are associated with repairing or replacing product components that have failed in an appliance; maintenance costs are associated with maintaining the operation of the product. Past rules indicate in general that small incremental increases in product efficiency produce no, or only minor, changes in repair and maintenance costs compared to baseline efficiency products. 76 FR 22454. For consumer clothes dryers, DOE derived annualized repair frequencies based on Consumer Reports data on repair and maintenance issues for clothes dryers during the first five years of ownership. DOE estimated that on average 2.7 percent of electric and 3.3 percent of gas clothes dryers are repaired each year. DOE estimated that an average service call and repair takes about 2.5 hours and that the average material cost is equal to one-half of the equipment cost. The values for cost per service call are then annualized by multiplying by the frequencies and dividing by the average equipment lifetime of 14 years. AHAM suggested that repair costs may be higher with increased efficiency because repairs will likely be more complex. AHAM stated that if energy conservation standards require baseline products to have electronic controls, repair and maintenance costs will likely increase for the same reason. 47 EIA. Annual Energy Outlook 2021 with Projections to 2050. Washington, DC. Available at www.eia.gov/forecasts/aeo/ (last accessed November 8, 2021). PO 00000 Frm 00032 Fmt 4701 Sfmt 4702 Additionally, AHAM stated that longer cycle times may also drive increased rate of repair and shorter product lifetimes. (AHAM, No. 23 at p. 11) Whirlpool requested that DOE account for changes to components that may be needed to accommodate longer cycle times, as well as the possibility of increased maintenance costs associated with longer cycle times. According to Whirlpool, increased cycle time leads to more wear and tear on the dryer as components could fail before the end of the estimated lifespan of the entire dryer, resulting in additional expenses. (Whirlpool, No. 27 at p. 12) DOE based its current estimates of repair and maintenance cost on available data. As stated above, DOE estimated that an average service call and repair for a consumer clothes dryer takes about 2.5 hours and the average material cost is equal to one-half of the equipment cost. DOE will take into consideration any data on frequency of repair for higher-efficiency dryers if it becomes available. DOE requests information and data on repair cost for replacing an electromechanical and electronic control panel. In addition, DOE seeks input on characterizing maintenance and repair costs for more-efficient consumer clothes dryers. 6. Product Lifetime For consumer clothes dryers, DOE developed a distribution of lifetimes from which specific values are assigned to the appliances in the samples. DOE conducted an analysis of actual lifetime in the field using a combination of historical shipments data, the stock of the considered appliances in the American Housing Survey, and responses in RECS on the age of the appliances in the homes. The data allowed DOE to estimate a survival function, which provides an average appliance lifetime. This analysis yielded a lifetime probability distribution with an average lifetime for consumer clothes dryers of approximately 14 years. See chapter 8 of the NOPR TSD for further details. Whirlpool requested that DOE account for changes to components that may be needed to accommodate longer cycle times, as well as the possibility of shorter product lifetimes associated with longer cycle times. (Whirlpool, No. 27 at p. 12) DOE will take into consideration any data that becomes available on changes to components to accommodate longer cycle times and the possibility of its impact on product lifetime. E:\FR\FM\23AUP2.SGM 23AUP2 51765 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules 7. Discount Rates In the calculation of LCC, DOE applies discount rates appropriate to households to estimate the present value of future operating cost savings. DOE estimated a distribution of discount rates for consumer clothes dryers based on the opportunity cost of consumer funds. DOE applies weighted average discount rates calculated from consumer debt and asset data, rather than marginal or implicit discount rates.48 The LCC analysis estimates net present value over the lifetime of the product, so the appropriate discount rate will reflect the general opportunity cost of household funds, taking this time scale into account. Given the long time horizon modeled in the LCC analysis, the application of a marginal interest rate associated with an initial source of funds is inaccurate. Regardless of the method of purchase, consumers are expected to continue to rebalance their debt and asset holdings over the LCC analysis period, based on the restrictions consumers face in their debt payment requirements and the relative size of the interest rates available on debts and assets. DOE estimates the aggregate impact of this rebalancing using the historical distribution of debts and assets. To establish residential discount rates for the LCC analysis, DOE identified all relevant household debt or asset classes in order to approximate a consumer’s opportunity cost of funds related to appliance energy cost savings. It estimated the average percentage shares of the various types of debt and equity by household income group using data from the Federal Reserve Board’s Survey of Consumer Finances 49 (‘‘SCF’’) for 1995, 1998, 2001, 2004, 2007, 2010, 2013, 2016, and 2019. Using the SCF and other sources, DOE developed a distribution of rates for each type of debt and asset by income group to represent the rates that may apply in the year in which amended standards would take effect. DOE assigned each sample household a specific discount rate drawn from one of the distributions. The average rate across all types of household debt and equity and income groups, weighted by the shares of each type, is 4.3 percent. See chapter 8 of the NOPR TSD for further details on the development of consumer discount rates. Energy Solutions questioned whether DOE expects changes to be made regarding average real effective discount rate as a function of different income groups. (Webinar Transcript, No. 22 at p. 71) As discussed above, DOE takes different income groups into consideration for establishing discount rates. 8. Energy Efficiency Distribution in the No-New-Standards Case To accurately estimate the share of consumers that would be affected by a potential energy conservation standard at a particular efficiency level, DOE’s LCC analysis considered the projected distribution (market shares) of product efficiencies under the no-new-standards case (i.e., the case without amended or new energy conservation standards). To estimate the energy efficiency distribution of consumer clothes dryers for 2027, DOE used data from DOE’s CCMS and ENEGY STAR Clothes Dryer program.50 51 DOE estimated an annual 0.31 percent and 0.37 percent increase in shipment-weighted efficiency beginning in 2022 for electric standard and vented gas standard clothes dryers, respectively. Annual shipmentweighted efficiency for the other product classes (which in total have less than 2.5 percent market share) is held constant. The estimated market shares for the no-new-standards case for consumer clothes dryers are shown in Table IV.31 and Table IV.32. See chapter 8 of the NOPR TSD for further information on the derivation of the efficiency distributions. TABLE IV.31—NO-NEW-STANDARDS CASE EFFICIENCY DISTRIBUTION IN 2027: ELECTRIC STANDARD, ELECTRIC COMPACT (120V), VENTED ELECTRIC COMPACT (240V), AND VENTLESS ELECTRIC COMPACT (240V) Electric standard CEFD2 (lb/kWh) lotter on DSK11XQN23PROD with PROPOSALS2 2.20 2.68 3.04 3.27 3.93 4.21 5.20 7.39 Electric compact (120V) Share (%) ............................................................... ............................................................... ............................................................... ............................................................... ............................................................... ............................................................... ............................................................... ............................................................... 30.8 0.89 1.07 1.94 61.0 2.62 0.60 1.06 48 The implicit discount rate is inferred from a consumer purchase decision between two otherwise identical goods with different first cost and operating cost. It is the interest rate that equates the increment of first cost to the difference in net present value of lifetime operating cost, incorporating the influence of several factors: transaction costs; risk premiums and response to VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 CEFD2 (lb/kWh) 2.36 3.15 3.35 4.28 4.33 4.63 6.37 Vented electric, compact (240V) Share (%) CEFD2 (lb/kWh) 58.6 0.0 10.3 0.0 0.0 0.0 31.0 uncertainty; time preferences; interest rates at which a consumer is able to borrow or lend. 49 U.S. Board of Governors of the Federal Reserve System. Survey of Consumer Finances. 1995, 1998, 2001, 2004, 2007, 2010, 2013, 2016, and 2019. Available at www.federalreserve.gov/econresdata/ scf/scfindex.htm (last accessed November 8, 2021.) 50 U.S. Department of Energy’s Compliance Certification Database. Available at PO 00000 Frm 00033 Fmt 4701 Sfmt 4702 Share (%) 2.00 2.44 2.76 3.30 3.57 3.82 3.91 Ventless electric, compact (240V) CEFD2 (lb/kWh) 73.7 0.0 10.5 15.8 0.0 0.0 0.0 2.03 2.68 6.80 Share (%) 10.4 87.5 2.08 www.regulations.doe.gov/certification-data/ #q=Product_Group_s%3A* (last accessed November 8, 2021). 51 ENERGY STAR, ENERGY STAR® Unit Shipment and Market Penetration Report Calendar Year 2020 Summary. Available at www.energystar.gov/partner_resources/products_ partner_resources/brand_owner_resources/unit_ shipment_data (last accessed November 8, 2021). E:\FR\FM\23AUP2.SGM 23AUP2 51766 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules TABLE IV.32—NO-NEW-STANDARDS CASE EFFICIENCY DISTRIBUTION IN 2027: VENTED GAS STANDARD, VENTED GAS COMPACT, AND VENTLESS ELECTRIC COMBINATION WASHER-DRYER Vented gas standard Vented gas compact Share (%) CEFD2 (lb/kWh) 2.00 2.44 3.00 3.48 3.83 ...................................................................................... ...................................................................................... ...................................................................................... ...................................................................................... ...................................................................................... lotter on DSK11XQN23PROD with PROPOSALS2 NEEA encouraged DOE to retain the market distribution of dryer efficiency levels shown in the NIA of the preliminary analysis TSD. (NEEA, No. 30 at p. 15) DOE has revised its efficiency distribution based on more recent market data. DOE chose to not develop a consumer choice model for estimating the efficiency distribution for this round of analysis, as the only available model and price data are more than a decade old, and not as useful in capturing the current distribution. DOE will update the efficiency distribution if more recent price data becomes available. DOE requests comments, information, and data on the no-new-standards case efficiency distribution of consumer clothes dryers. 9. Payback Period Analysis The payback period is the amount of time it takes the consumer to recover the additional installed cost of moreefficient products, compared to baseline products, through energy cost savings. Payback periods are expressed in years. Payback periods that exceed the life of the product mean that the increased total installed cost is not recovered in reduced operating expenses. The inputs to the PBP calculation for each efficiency level are the change in total installed cost of the product and the change in the first-year annual operating expenditures relative to the baseline. The PBP calculation uses the same inputs as the LCC analysis, except that discount rates are not needed. As noted previously, EPCA establishes a rebuttable presumption that a standard is economically justified if the Secretary finds that the additional cost to the consumer of purchasing a product complying with an energy conservation standard level will be less than three times the value of the first year’s energy savings resulting from the standard, as calculated under the applicable test procedure. (42 U.S.C. 6295(o)(2)(B)(iii)) For each considered efficiency level, DOE determined the value of the first year’s energy savings VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 CEFD2 (lb/kWh) 49.3 4.45 3.75 38.1 4.44 G. Shipments Analysis DOE uses projections of annual product shipments to calculate the national impacts of potential amended or new energy conservation standards on energy use, NPV, and future manufacturer cash flows.52 The shipments model takes an accounting approach, tracking market shares of each product class and the vintage of units in the stock. Stock accounting uses product shipments as inputs to estimate the age distribution of in-service product stocks for all years. The age distribution of in-service product stocks is a key input to calculations of both the NES and NPV, because operating costs for any year depend on the age distribution of the stock. Total product shipments for consumer clothes dryers are developed by considering the demand from replacements for units in stock that fail and the demand from new installations in newly constructed homes. DOE calculated shipments due to replacements using the retirement function developed for the LCC analysis. DOE calculated shipments due to new installations using estimates for consumer clothes dryer saturation rate in newly constructed homes from 2010 to 2015 in 2015 RECS and projections of new housing starts from AEO2021. DOE disaggregated total product shipments into each product class using estimated market shares of each product class. To estimate these market shares, DOE first developed a linear time-series regression model to estimate market share between the product fuel type (gas 52 DOE uses data on manufacturer shipments as a proxy for national sales, as aggregate data on sales are lacking. In general, one would expect a close correspondence between shipments and sales. PO 00000 Frm 00034 Fmt 4701 Sfmt 4702 Share (%) 1.66 2.02 2.49 2.89 3.17 by calculating the energy savings in accordance with the applicable DOE test procedure, and multiplying those savings by the average energy price projection for the year in which compliance with the amended standards would be required. Ventless electric, combination washer-dryer CEFD2 (lb/kWh) 100 0.0 0.0 0.0 0.0 2.27 2.33 4.01 Share (%) 70.0 26.7 3.33 or electric) by fitting the historical shipments of gas consumer clothes dryers. Historical shipments data shown a steady decline of market share of gas consumer clothes dryers from 23 percent in 2000 to 18 percent in 2020. The linear regression model indicates that market share of gas consumer clothes dryers is strongly correlated with its historical time-series. After developing the market share estimation between the electric and gas consumer clothes dryers, DOE then subtracted estimated gas clothes dryer market share from total shipments and divided the electric clothes dryer market share into each electric consumer clothes dryer product class. DOE estimated that electric standard and vented gas standard consumer clothes dryers account for approximately 84 percent and 14 percent of the total shipments during the analysis period, respectively. Whirlpool points out that the projected consumer clothes dryer market shares by product class do not show any change in the balance of sale between the product classes, aside from a loss of share from Vented Gas Standard and an increase in share of Vented Electric Standard. Whirlpool indicates that they have started to see more shipments of other product classes over the last few years, including the ventless and combination washer/dryer product classes and therefore suggests that DOE project some growth in the balance of sale of these product classes. (Whirlpool, No. 27 at pp. 17–18) For this analysis, DOE does consider a slight growth in the market share of other product classes such as ventless and combination washer/dryers. DOE will consider any specific data that is available to project this category more accurately. To estimate shipments under a standards case, DOE considers the impacts on shipments from changes in product purchase price and operating cost associated with higher energy efficiency levels using a price elasticity and an efficiency elasticity. As in the E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules April 2021 Preliminary Analysis, DOE employed a 0.2 percent efficiency elasticity rate and a price elasticity of –0.45 percent in its shipments model. These values are based on analysis of aggregated data for five residential appliances including consumer clothes washers, dishwashers, refrigerators, freezers, and room air-conditioners.53 The market impact is defined as the difference between the product of price elasticity of demand and the change in price due to a standard level, and the product of the efficiency elasticity and the change in operating costs due to a standard level. See chapter 9 of the NOPR TSD for details. ASAP and NRDC encouraged DOE to clarify and confirm whether the efficiency elasticity is considered in calculating the standards-case shipments. Commenters noted that the preliminary TSD described a price elasticity of –0.45 and an efficiency elasticity of +0.2 but that the equation for calculating total shipments in the standards case included only the price elasticity of –0.45. (ASAP, NRDC, No. 25 at p. 4) As discussed earlier, DOE considers the impact of increase in purchase price as well as efficiency in estimating the shipments through the use of a price elasticity. The NOPR TSD describes both elasticities and provides an equation in chapter 9. DOE requests comment on its methodology for estimating shipments. DOE also requests comment on its approach to estimate the market share for each consumer clothes dryer product class. H. National Impact Analysis The NIA assesses the NES and the NPV from a national perspective of total consumer costs and savings that would be expected to result from new or amended standards at specific efficiency levels.54 (‘‘Consumer’’ in this context refers to consumers of the product being regulated.) DOE calculates the NES and NPV for the potential standard levels considered based on projections of annual product shipments, along with the annual energy consumption and total installed cost data from the energy use and LCC analyses. For the present analysis, DOE projected the energy savings, operating cost savings, product costs, and NPV of consumer benefits over the lifetime of consumer clothes dryers sold from 2027 through 2056. DOE evaluates the impacts of new or amended standards by comparing a case without such standards with standardscase projections. The no-new-standards 51767 case characterizes energy use and consumer costs for each product class in the absence of new or amended energy conservation standards. For this projection, DOE considers historical trends in efficiency and various forces that are likely to affect the mix of efficiencies over time. DOE compares the no-new-standards case with projections characterizing the market for each product class if DOE adopted new or amended standards at specific energy efficiency levels (i.e., the TSLs or standards cases) for that class. For the standards cases, DOE considers how a given standard would likely affect the market shares of products with efficiencies greater than the standard. DOE uses a spreadsheet model to calculate the energy savings and the national consumer costs and savings from each TSL. Interested parties can review DOE’s analyses by changing various input quantities within the spreadsheet. The NIA spreadsheet model uses typical values (as opposed to probability distributions) as inputs. Table IV.33 summarizes the inputs and methods DOE used for the NIA analysis for the NOPR. Discussion of these inputs and methods follows the table. See chapter 10 of the NOPR TSD for further details. TABLE IV.33—SUMMARY OF INPUTS AND METHODS FOR THE NATIONAL IMPACT ANALYSIS Inputs Method Shipments ....................................... Compliance Date of Standard ........ Efficiency Trends ............................ Annual shipments from shipments model. 2027. No-new-standards case: Annual efficiency improvement of 0.31 percent for electric standard and 0.37 for vented gas standard consumer clothes dryers. Standards cases: ‘‘Roll up’’ equipment to meet potential efficiency level. Calculated for no-new-standards case and each TSL based on inputs from energy use analysis. Annual Energy Consumption per Unit. Total Installed Cost per Unit ........... Repair and Maintenance Cost per Unit. Energy Prices .................................. Energy Price Trends ....................... lotter on DSK11XQN23PROD with PROPOSALS2 Energy Site-to-Primary and FFC Conversion. Discount Rate ................................. Present Year ................................... Calculated for no-new-standards case and each TSL based on inputs from the LCC analysis. Incorporates projection of future product prices based on historical data. Assumed no change with efficiency level for maintenance cost. Repair cost is calculated for each efficiency level based on inputs from the LCC analysis. Estimated average and marginal electricity and gas prices from the LCC analysis based on EEI and EIA data. AEO2021 projections (to 2050) and extrapolation using a fixed annual rate of price change between 2040 and 2050 thereafter. A time-series conversion factor based on AEO2021. 3 percent and 7 percent. 2021. 1. Product Efficiency Trends A key component of the NIA is the trend in energy efficiency projected for the no-new-standards case and each of the standards cases. Section IV.F.8 of this document describes how DOE developed an energy efficiency distribution for the no-new-standards case (which yields a shipment-weighted average efficiency) for each of the considered product classes for the year of anticipated compliance with an amended or new standard. To project the trend in efficiency absent amended 53 Fujita, K. (2015) Estimating Price Elasticity using Market-Level Appliance Data. Lawrence Berkeley National Laboratory, LBNL–188289. 54 The NIA accounts for impacts in the 50 states and the District of Columbia. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00035 Fmt 4701 Sfmt 4702 standards for consumer clothes dryers over the entire shipments projection period, DOE used an annual 0.31 percent and 0.37 percent increase in shipment-weighted efficiency beginning in 2022 for electric standard and vented gas standard consumer clothes dryers, E:\FR\FM\23AUP2.SGM 23AUP2 51768 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules lotter on DSK11XQN23PROD with PROPOSALS2 respectively. The efficiency for the other product classes remains at their 2021 shipments-weighted efficiency levels. The approach is further described in chapter 10 of the NOPR TSD. For the standards cases, DOE used a ‘‘roll-up’’ scenario to establish the shipment-weighted efficiency for the year that standards are assumed to become effective (2027). In this scenario, the market shares of products in the no-new-standards case that do not meet the standard under consideration would ‘‘roll up’’ to meet the new standard level, and the market share of products above the standard would remain unchanged. 2. National Energy Savings The national energy savings analysis involves a comparison of national energy consumption of the considered products between each potential standards case (‘‘TSL’’) and the case with no new or amended energy conservation standards. DOE calculated the national energy consumption by multiplying the number of units (stock) of each product (by vintage or age) by the unit energy consumption (also by vintage). DOE calculated annual NES based on the difference in national energy consumption for the no-new standards case and for each higher efficiency standard case. DOE estimated energy consumption and savings based on site energy and converted the electricity consumption and savings to primary energy (i.e., the energy consumed by power plants to generate site electricity) using annual conversion factors derived from AEO2021. Cumulative energy savings are the sum of the NES for each year over the timeframe of the analysis. Use of higher-efficiency products is sometimes associated with a direct rebound effect, which refers to an increase in utilization of the product due to the increase in efficiency. DOE did not find any data on the rebound effect specific to consumer clothes dryers, so it did not include a rebound effect in the analysis. Whirlpool suggested that additional energy usage may result from increased cycle times and the inability to complete serial loads when consumers decide to re-wash a load if wet clothes sit in the washer while waiting for the drying cycle to terminate. Whirlpool stated that such a scenario could result in additional and unnecessary energy consumption and should be closely examined as rebound effects from increased cycle times. (Whirlpool No. 27, at p. 11) For this analysis, DOE did not find any studies supporting or indicating an VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 increased usage resulting from cycle times. DOE requests comment on any new information or data that points to an impact on usage due to a change in cycle times and will consider such data at the final rule stage and in the final TSD. In 2011, 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 Sciences, DOE announced its intention to use 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 (Aug. 18, 2011). After evaluating the approaches discussed in the August 18, 2011 notice, DOE published a statement of amended policy in which DOE explained its determination that EIA’s National Energy Modeling System (‘‘NEMS’’) is the most appropriate tool for its FFC analysis and its intention to use NEMS for that purpose. 77 FR 49701 (Aug. 17, 2012). NEMS is a public domain, multi-sector, partial equilibrium model of the U.S. energy sector 55 that EIA uses to prepare its Annual Energy Outlook. The FFC factors incorporate losses in production and delivery in the case of natural gas (including fugitive emissions) and additional energy used to produce and deliver the various fuels used by power plants. The approach used for deriving FFC measures of energy use and emissions is described in appendix 10B of the NOPR TSD. 3. Net Present Value Analysis The inputs for determining the NPV of the total costs and benefits experienced by consumers are (1) total annual installed cost, (2) total annual operating costs (energy costs and repair and maintenance costs), and (3) a discount factor to calculate the present value of costs and savings. DOE calculates net savings each year as the difference between the no-newstandards case and each standards case in terms of total savings in operating costs versus total increases in installed costs. DOE calculates operating cost savings over the lifetime of each product shipped during the projection period. As discussed in section IV.F.1 of this document, DOE developed consumer clothes dryers price trends based on historical PPI data. DOE applied the 55 For more information on NEMS, refer to The National Energy Modeling System: An Overview 2009, DOE/EIA–0581(2009), October 2009. Available at www.eia.gov/forecasts/aeo/index.cfm (last accessed November 8, 2021). PO 00000 Frm 00036 Fmt 4701 Sfmt 4702 same trends to project prices for each product class at each considered efficiency level. By 2056, which is the end date of the projection period, the average consumer clothes dryers (real) price is projected to drop 15 percent relative to 2020. DOE’s projection of product prices is described in appendix 10C of the NOPR TSD. To evaluate the effect of uncertainty regarding the price trend estimates, DOE investigated the impact of different product price projections on the consumer NPV for the considered TSLs for consumer clothes dryers. In addition to the default price trend, DOE considered two product price sensitivity cases: (1) a high price decline case based on the combined price index from 1980 to 2020 and (2) a low price decline case based on the same series from 1948 to 1979.56 The derivation of these price trends and the results of these sensitivity cases are described in appendix 10C of the NOPR TSD. The energy cost savings are calculated using the estimated energy savings in each year and the projected price of the appropriate form of energy. To estimate energy prices in future years, DOE used the projection of annual nationalaverage residential energy price changes in the Reference case from AEO2021, which has an end year of 2050. To estimate price trends after 2050, DOE used the average annual rate of change in prices from 2040 through 2050. As part of the NIA, DOE also analyzed scenarios that used inputs from variants of the AEO2021 Reference case that have lower and higher economic growth. Those cases have lower and higher energy price trends compared to the Reference case. NIA results based on these cases are presented in appendix 10D of the NOPR TSD. In calculating the NPV, DOE multiplies the net savings in future years by a discount factor to determine their present value. For this NOPR, DOE estimated the NPV of consumer benefits using both a 3-percent and a 7-percent real discount rate. DOE uses these discount rates in accordance with guidance provided by the Office of Management and Budget (‘‘OMB’’) to Federal agencies on the development of regulatory analysis.57 The discount rates 56 DOE combined PPI data of ‘‘household laundry equipment’’ from 1948 to 2016 and PPI data of ‘‘major household appliance: primary products’’ from 2016 to 2020 into one time series price index to project future price for consumer clothes washers. 57 United States Office of Management and Budget. Circular A–4: Regulatory Analysis. September 17, 2003. Section E. Available at https:// www.whitehouse.gov/wp-content/uploads/legacy_ drupal_files/omb/circulars/A4/a-4.pdf (last accessed November 8, 2021). E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules lotter on DSK11XQN23PROD with PROPOSALS2 for the determination of NPV are in contrast to the discount rates used in the LCC analysis, which are designed to reflect a consumer’s perspective. 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 ‘‘social rate of time preference,’’ which is the rate at which society discounts future consumption flows to their present value. I. Consumer Subgroup Analysis In analyzing the potential impact of new or amended energy conservation standards on consumers, DOE evaluates the impact on identifiable subgroups of consumers that may be disproportionately affected by a new or amended national standard. The purpose of a subgroup analysis is to determine the extent of any such disproportional impacts. DOE evaluates impacts on particular subgroups of consumers by analyzing the LCC impacts and PBP for those particular consumers from alternative standard levels. For this NOPR, DOE analyzed the impacts of the considered standard levels on two subgroups: (1) low-income households and (2) senior-only households. The analysis used subsets of the 2015 RECS sample composed of households that meet the criteria for the two subgroups. DOE used the LCC and PBP spreadsheet model to estimate the impacts of the considered efficiency levels on these subgroups. Chapter 11 in the NOPR TSD describes the consumer subgroup analysis. Whirlpool requested that DOE examine the impact of amended standards on the increased purchase cost of dryers, particularly for lowincome consumers. According to Whirlpool, the purchase cost of a dryer plays a significant, and often the leading, factor in a low-income consumer’s purchase decision. Additionally, Whirlpool states that for many low-income consumers, appliance purchases are generally not planned and happen when their current appliance breaks down or is too costly or old to fix. With a high purchase cost, lowincome consumers may ultimately decide to keep the old unit and repair it or purchase a used appliance, both of which would keep old, inefficient appliances on the grid, counter to DOE’s mission to save energy. (Whirlpool, No. 27 at pp. 6–8) AHAM requested that DOE take special care to protect lowincome consumers and to ensure energy conservation standards do not have a disproportionate impact on those consumers, stating that any proposed standard level not require product VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 design options that price consumers, particularly low-income consumers, out of the clothes dryer market by eliminating technology options that allow manufacturers to produce ‘‘entry level’’ models. (AHAM, No. 23 at p. 5) DOE considers the impact of increase in purchase price as well as efficiency in estimating the shipments through the use of a price elasticity. This integrated elasticity accounts for the choice of repair versus replace, which is ultimately reflected in the resulting shipments. Additionally, the impacts from design options on low-income consumers are already accounted for by definition in the screening, engineering, LCC subgroup, and manufacturer impact analyses. See chapter 9 of the NOPR TSD for details on price elasticity and chapter 11 for details on low-income consumers impacts. J. Manufacturer Impact Analysis 1. Overview DOE performed a MIA to estimate the financial impacts of amended energy conservation standards on manufacturers of consumer clothes dryers and to estimate the potential impacts of such standards on employment and manufacturing capacity. The MIA has both quantitative and qualitative aspects and includes analyses of projected 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 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, including small business manufacturers. 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 uses standard accounting principles to estimate the impacts of PO 00000 Frm 00037 Fmt 4701 Sfmt 4702 51769 more-stringent energy conservation standards on a given industry by comparing changes in INPV and domestic manufacturing employment between a no-new-standards case and the various TSLs. To capture the uncertainty relating to manufacturer pricing strategies following amended standards, the GRIM estimates a range of possible impacts under different manufacturer markup scenarios. The qualitative part of the MIA addresses manufacturer characteristics and market trends. Specifically, the MIA considers such factors as a potential standard’s impact on manufacturing capacity, competition within the industry, the cumulative impact of other DOE and non-DOE regulations, and impacts on manufacturer subgroups. 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 consumer clothes dryer industry based on publicly available data and information from its market and technology assessment and engineering analysis. This included a top-down analysis of consumer clothes dryer 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 other public sources of information to further calibrate its initial characterization of the consumer clothes dryer manufacturing industry, including company filings of form 10– K from the U.S. Securities and Exchange Commission (‘‘SEC’’),58 corporate annual reports, and the U.S. Census Bureau’s Economic Census,59 as well as subscription-based market research tools (e.g., reports from Dun & Bradstreet 60). In Phase 2 of the MIA, DOE prepared a framework industry cash-flow analysis to quantify the potential impacts of 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 compliance date of the standard. These factors include annual 58 U.S. Securities and Exchange Commission. Company Filings. Available at https://www.sec.gov/ edgar/searchedgar/companysearch.html. 59 The U.S. Census Bureau. Quarterly Survey of Plant Capacity Utilization. Available at www.census.gov/programs-surveys/qpc/data/ tables.html. 60 The Dun & Bradstreet Hoovers login is available at app.dnbhoovers.com. E:\FR\FM\23AUP2.SGM 23AUP2 51770 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules lotter on DSK11XQN23PROD with PROPOSALS2 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) creating a need for increased investment, (2) raising production costs per unit, and (3) altering 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 consumer clothes dryers in order to 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 representative 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.3 of this document 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 business manufacturers, lowvolume manufacturers, niche players, and/or manufacturers exhibiting a cost structure that largely differs from the industry average. DOE identified one subgroup for a separate impact analysis: small business manufacturers. The small business subgroup is discussed in section VI.B of this document, ‘‘Review under the Regulatory Flexibility Act’’ and in chapter 12 of the NOPR TSD. 2. Government Regulatory Impact Model and Key Inputs DOE uses the GRIM to quantify the changes in cash flow due to amended standards that result in a higher or lower industry value. The GRIM uses a standard, annual discounted cash-flow analysis that incorporates manufacturer costs, manufacturer markups, shipments, and industry financial information as inputs. The GRIM models changes in costs, distribution of shipments, investments, and manufacturer margins that could result from an amended energy conservation VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 standard. The GRIM spreadsheet uses the inputs to arrive at a series of annual cash flows, beginning in 2022 (the base year of the analysis) and continuing to 2056. DOE calculated INPVs by summing the stream of annual discounted cash flows during this period. For manufacturers of consumer clothes dryers, DOE used a real discount rate of 7.5 percent, which was derived from industry financials and then modified according to feedback received during manufacturer interviews. The GRIM calculates cash flows using standard accounting principles and compares changes in INPV between the no-new-standards case and each standards case. The difference in INPV between the no-new-standards case and a standards case represents the financial impact of the amended energy conservation standard on manufacturers. As discussed previously, DOE developed critical GRIM inputs using a number of sources, including publicly available data, results of the engineering analysis, projections from the shipments analysis, and information gathered from industry stakeholders during the course of manufacturer interviews. The GRIM results are presented in section V.B.2 of this document. Additional details about the GRIM, the discount rate, and other financial parameters can be found in chapter 12 of the NOPR TSD. a. Manufacturer Production Costs Manufacturing more efficient equipment is typically more expensive than manufacturing baseline equipment due to the use of more complex components, which are typically more costly than baseline components. The changes in the MPCs of covered products can affect the revenues, gross margins, and cash flow of the industry. DOE models the relationship between efficiency and MPCs as a part of its engineering analysis. For a complete description of the MPCs, see chapter 5 of the NOPR TSD or section IV.C of this document. b. Shipments Projections The GRIM estimates manufacturer revenues based on total unit shipment projections and the distribution of those shipments by efficiency level and by product class. 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 projections derived from the shipments analysis from 2022 (the base year) to 2056 (the end year of the analysis period). See chapter 9 of the NOPR TSD PO 00000 Frm 00038 Fmt 4701 Sfmt 4702 for additional details or section IV.G of this document. c. Product and Capital Conversion Costs Amended energy conservation standards could cause manufacturers to incur conversion costs to bring their production facilities and equipment designs into compliance. DOE evaluated the level of conversion-related expenditures that would be needed to comply with each considered efficiency level in each product class. For the MIA, DOE classified these conversion costs into two major groups: (1) capital conversion costs; and (2) product conversion costs. Capital conversion costs are investments in property, plant, and equipment necessary to adapt or change existing production facilities such that new compliant product designs can be fabricated and assembled. Product conversion costs are investments in research, development, testing, marketing, and other noncapitalized costs necessary to make product designs comply with amended energy conservation standards. DOE relied on manufacturer feedback to evaluate the level of capital and product conversion costs manufacturers would likely incur at the various TSLs. During confidential interviews, DOE asked manufacturers to estimate the capital conversion costs (e.g., changes in production processes, equipment, and tooling) to meet the various efficiency levels. DOE also asked manufacturers to estimate the redesign effort and engineering resources required at various efficiency levels to quantify the product conversion costs. Based on manufacturer feedback, DOE also estimated ‘‘re-flooring’’ costs associated with replacing obsolete display models in big-box stores (e.g., Lowe’s, Home Depot, Best Buy) due to higher standards. Some manufacturers stated that with a new product release, big-box retailers discount outdated display models, and manufacturers share any losses associated with discounting the retail price. The estimated re-flooring costs for each efficiency level were incorporated into the product conversion cost estimates, as DOE modeled the re-flooring costs as a marketing expense. DOE reviewed the DOE CCMS 61 database, U.S. market share estimates, and company characteristics to scale the company-specific conversion cost estimates to levels that represent the overall industry. First, DOE used its 61 U.S. Department of Energy’s Compliance Certification Database is available at www.regulations.doe.gov/certification-data (last accessed October 8, 2021). E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules lotter on DSK11XQN23PROD with PROPOSALS2 CCMS database to identify original equipment manufacturers (‘‘OEMs’’) of the covered products. Next, DOE assessed each OEM’s U.S. market share and product profile (e.g., estimated sales by product class and efficiency) for consumer clothes dryers. Finally, DOE estimated industry-level conversion cost estimates by scaling feedback from OEMs based on a combination of product offerings and U.S. market share estimates. DOE assumes all conversion-related investments occur between the year of publication of the final rule and the year by which manufacturers must comply with the new standard. The conversion cost figures used in the GRIM can be found in section V.B.2 of this document. For additional information on the estimated capital and product conversion costs, see chapter 12 of the NOPR TSD. d. Manufacturer Markup Scenarios MSPs include direct manufacturing production costs (i.e., labor, materials, and overhead 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 for each product class and efficiency level. Modifying these manufacturer markups in the standards case yields different sets of impacts on manufacturers. For the MIA, DOE modeled two standards-case manufacturer markup scenarios to represent 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 scenario; and (2) a preservation of operating profit scenario. These scenarios lead to different manufacturer markup 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’’ across all efficiency levels, which assumes that manufacturers would be able to maintain the same amount of profit as a percentage of revenues at all efficiency levels within a product class. As manufacturer production costs increase with efficiency, this scenario implies that the per-unit dollar profit will increase. DOE assumed a gross margin percentage of 21 percent for all product classes.62 62 The gross margin percentage of 21 percent is based on a manufacturer markup of 1.26. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 Manufacturers tend to believe it is optimistic to assume that they would be able to maintain the same gross margin percentage as their production costs increase, particularly for minimally efficient products. Therefore, this scenario represents a high bound to industry profitability under an amended energy conservation standard. In the preservation of operating profit scenario, as the cost of production goes up under a standards case, manufacturers are generally required to reduce their manufacturer markups to a level that maintains base-case operating profit. DOE implemented this scenario in the GRIM by lowering the manufacturer markups at each TSL to yield approximately the same earnings before interest and taxes in the standards case as in the no-newstandards case in the year after the compliance date of the amended standards. The implicit assumption behind this scenario is that the industry can only maintain its operating profit in absolute dollars after the standard. A comparison of industry financial impacts under the two manufacturer markup scenarios is presented in section V.B.2.a of this document. 3. Manufacturer Interviews DOE interviewed manufacturers representing approximately 55 percent of domestic consumer clothes dryer industry shipments. Participants included domestic-based and foreignbased OEMs with a range of different product offerings and market shares. In interviews, DOE asked manufacturers to describe their major concerns regarding potential increases in energy conservation standards for consumer clothes dryers. The following section highlights manufacturer concerns that helped inform the projected potential impacts of an amended standard on the industry. Manufacturer interviews are conducted under non-disclosure agreements (‘‘NDAs’’), so DOE does not document these discussions in the same way that it does public comments in the comment summaries and in DOE’s responses throughout the rest of this document. a. Heat Pump Technology Some manufacturers expressed concerns about potential adverse impacts of a standard that could only be met using heat pump technology on product affordability, consumer satisfaction, profitability, and manufacturing capacity. Heat pump dryers currently cost more to produce than other electric dryers. In interviews, some manufacturers stated that a PO 00000 Frm 00039 Fmt 4701 Sfmt 4702 51771 portion of consumers cannot afford the increased upfront cost and may forgo purchasing a new dryer or rely on alternatives such as laundromats or dryer rentals if the standard were to increase to a level that required the use of heat pump technology. Some manufacturers asserted, based on their market research and customer reviews of existing heat pump dryers, that consumers would be dissatisfied with a standard that could be achieved only by a heat pump dryer. These manufacturers cited instances of customer complaints about drying performance and longer cycle times that have been associated with certain implementations of heat pump technology. In interviews, several manufacturers also stated that heat pump technology represents a significant departure from vented electric dryers and would require new manufacturing plants or a total renovation of existing production facilities. Those manufacturers pointed out that heat pump dryers make up less than one percent of the consumer clothes dryer sales in the United States. The same manufacturers expressed concern about a potential shortage of products given the scale of investment, redesign efforts, and time constraints. Although some manufacturers expressed concerns about a standard that could only be met using heat pump technology, several manufacturers emphasized the benefits of heat pump technology. These manufacturers stated that heat pump dryers provide more energy savings and improved fabric care compared to conventional clothes dryers due to the lower drying temperatures associated with heat pump technology. Several manufacturers noted recent increases in domestic heat pump dryer sales and predicted that the trend would continue. These manufacturers also emphasized the increasing popularity of heat pump dryers in the European market, which they attributed to the proliferation of cost-competitive offerings, improved payback period, and shifting consumer preferences in that market. Although heat pump technology is still in the early stages of adoption in the United States, heat pump technology is commercially available on the market and can be incorporated into standard-size electric clothes dryers without the need to increase overall product size. As discussed in the engineering analysis, recent advances have resulted in heat pump products that do not require sacrifices in either dryness level or cycle time. DOE expects that that the U.S. market will continue to benefit from further advances in heat pump technology in the European E:\FR\FM\23AUP2.SGM 23AUP2 51772 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules market, as manufacturers adapt those advances to products designed for the U.S. consumer. In addition, voluntary programs such as ENERGY STAR and various State incentive programs have the potential to significantly grow the market share of heat pump models. As discussed in the life-cycle cost analysis, as heat pump technology continues to gain market share over time, DOE expects that learning and experience by manufacturers will likely contribute to downward costs over time. b. Preservation of Electromechanical Controls Some manufacturers expressed concern that higher energy conservation standards or requiring the use of the Appendix D2 test procedure would threaten the viability of dryers with electromechanical controls. In interviews, these manufacturers noted that some consumers prefer the simplicity of electromechanical control knobs and the lower price point associated with the lower production cost. Manufacturers also noted that eliminating electromechanical control dryers may raise the cost of baseline dryers, which would disproportionately impact low-income consumers since they typically purchase low-cost dryers with electromechanical controls. lotter on DSK11XQN23PROD with PROPOSALS2 c. Cost Increases and Component Shortages Some manufacturers noted that increases in raw material prices, escalating shipping and transportation costs, and limited component availability over the last two years all affect manufacturer production costs. As a result, cost estimates based on historic 5-year averages would underestimate current production costs. 4. Discussion of MIA Comments In response to the preliminary analysis, AHAM commented on DOE’s approach to analyzing cumulative regulatory burden. AHAM stated that the cumulative regulatory burden analysis should incorporate and quantify the costs to manufacturers associated with responding to and monitoring proposed test procedures and energy conservation standards. Additionally, AHAM urged DOE to incorporate the financial results of the cumulative regulatory burden analysis into the MIA, stating that this could be done by adding the combined cost of complying with multiple regulations into the product conversion costs in the GRIM. AHAM suggests performing a consolidated analysis of multiple regulations and notes that this approach is particularly important for related VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 products like clothes washers and clothes dryers that are often designed, invested in, and sold together. In addition, AHAM noted other regulations impact consumer clothes dryer manufacturers such as commercial clothes washers, consumer refrigerator/ freezers, dishwashers, room air conditioners, dehumidifiers, and portable air conditioners rulemakings. (AHAM, No. 23 at pp. 7–8) AHAM requested that DOE include the cost of monitoring test procedure and energy conservation standard rulemakings in its rulemaking analyses. (AHAM, No. 23 at p. 8) DOE requests AHAM provide the costs of monitoring, which would be independent from the conversion costs required to adapt product designs and manufacturing facilities to an amended standard, for DOE to determine whether these costs would materially affect the analysis. In particular, a summary of the job titles and annual hours per job title at a prototypical company would allow DOE to construct a detailed analysis of AHAM’s monitoring costs. Additionally, AHAM encouraged DOE to incorporate product conversion costs from multiple rulemakings in the GRIM. (AHAM, No. 23 at p. 8) If DOE were to combine the conversion costs from multiple regulations, as requested, it would be appropriate to match the combined conversion costs against combined revenues of the regulated products. DOE is concerned that combined results would likely make it more difficult to discern the direct impact of the amended standard on manufacturers, particularly for rulemakings where there is only partial overlap of manufacturers. Conversion costs would be spread over a larger revenue base and result in less severe INPV impacts, when evaluated on a percent change basis. Regarding the specific case of consumer clothes washers and clothes dryers, DOE understands that these products are often designed as sets and sold together. Additionally, DOE has received feedback from industry that aligning the compliance data for potential amended standards across the two rulemakings would reduce overall compliance costs. DOE will investigate harmonizing the timing of the two rulemakings but must work within the constraints of EPCA, which determines both the timing of when rulemakings are initiated and the selection of compliance dates when an amended standard is adopted. Regarding the other ongoing rulemakings mentioned, DOE has not proposed amended energy conservation standards or compliance dates for most PO 00000 Frm 00040 Fmt 4701 Sfmt 4702 of the products identified. Table V.31 details the rulemakings and expected conversion expenses of Federal energy conservation standards, such as room air conditioners and portable air conditioners, affecting consumer clothes dryer OEMs. DOE will reassess and consider all relevant final rules contributing to cumulative regulatory burden in any subsequent analysis. In written comment, Whirlpool asserted that requiring the use of the appendix D2 test procedure would effectively eliminate electromechanical controlled dryers since electronic controls would very likely be needed to deliver accurate sensing and end-ofcycle detection. Whirlpool expressed a variety of concerns regarding the potential phase out of electromechanical controls. First, Whirlpool stated that phasing out electromechanical control dryers will disproportionately harm manufacturers, such as Whirlpool, with significant sales of electromechanical control dryers. Whirlpool noted that a transition from electromechanical to electronic controls would require a significant amount of engineering resources and capital investment to upgrade manufacturing facilities and production lines. Second, Whirlpool noted that electromechanical control dryers are often purchased by pricesensitive customers as these dryers are typically entry-level and low-cost. Whirlpool stated that they may be forced to make significant product changes and add product costs, which would subsequently increase the upfront cost for the consumer. Third, Whirlpool expressed concerns about manufacturers’ ability to move to electronic controls considering the global supply chain shortage of semiconductors. Lastly, Whirlpool requested DOE consider the negative financial impact of potential standards on timer component suppliers. Demand for timer components is largely driven by dryers, so phasing out electromechanical controls might represent a significant business risk to these companies. Whirlpool stated at least one of these suppliers is a ‘‘small U.S.-based company.’’ (Whirlpool, No. 27 at pp. 4–6) DOE test data shows that requiring the use of the appendix D2 test procedure will not preclude the use of electromechanical controls. As discussed in section IV.C.1 of this document, DOE tested baseline models with electromechanical controls under appendix D2. The baseline efficiency levels in this NOPR represent a minimally compliant, basicconstruction consumer clothes dryer on the market, such as a dryer with E:\FR\FM\23AUP2.SGM 23AUP2 lotter on DSK11XQN23PROD with PROPOSALS2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules electromechanical controls. If tested under appendix D2, DOE does not expect dryers currently on the market to achieve a CEFD2 rating below the baseline efficiency levels detailed in this NOPR. As for Whirlpool’s broader concerns regarding the shift to electronic controls, DOE acknowledges that the GRIM is intended to represent the consumer clothes dryer industry as a whole. The impacts on individual manufacturers may vary from the industry average. DOE also recognizes that manufacturers with significant sales volumes of baseline efficiency dryers may experience differential impacts from amended standards relative to manufacturers specializing in highefficiency dryers. However, as many of the GRIM inputs (e.g., conversion costs, industry financials) account for U.S. market share weights, the GRIM is most reflective of large manufacturers like Whirlpool. Where possible, DOE suggests manufacturers provide company-specific information about their consumer clothes dryer business so DOE can more accurately incorporate it into its modeling of the overall industry. Regarding the other concerns identified, DOE’s analysis of conversion cost estimates is published in Table V.29 and the consumer sub-group analysis can be found in section V.B.1.b of this document. DOE appreciates the information about potential impacts to sub-component suppliers, however, analyzing the impacts of proposed standards on a timer component supplier is outside the scope of this analysis. a set of side cases that implement a variety of efficiency-related policies. The methodology is described in appendix 13A in the NOPR TSD. The analysis presented in this notice uses projections from AEO2021. Power sector emissions of CH4 and N2O are estimated using Emission Factors for Greenhouse Gas Inventories published by the EPA.63 The on-site operation of gas consumer clothes dryers requires combustion of fossil fuel and results in emissions of CO2, NOX, SO2, CH4, and N2O where these products are used. Site emissions of these gases were estimated using Emission Factors for Greenhouse Gas Inventories and, for NOX and SO2, emissions intensity factors from an EPA publication.64 FFC upstream emissions, which include emissions from fuel combustion during extraction, processing, and transportation of fuels, and ‘‘fugitive’’ emissions (direct leakage to the atmosphere) of CH4 and CO2, are estimated based on the methodology described in chapter 15 of the NOPR TSD. The emissions intensity factors are expressed in terms of physical units per megawatt-hours (‘‘MWh’’) or million British thermal units (‘‘MMBtu’’) of site energy savings. For power sector emissions, specific emissions intensity factors are calculated by sector and end use. Total emissions reductions are estimated using the energy savings calculated in the national impact analysis. K. Emissions Analysis The emissions analysis consists of two components. The first component estimates the effect of potential energy conservation standards on power sector and site (where applicable) combustion emissions of CO2, NOX, SO2, and Hg. The second component estimates the impacts of potential standards on emissions of two additional greenhouse gases, CH4 and N2O, as well as the reductions to emissions of other gases due to ‘‘upstream’’ activities in the fuel production chain. These upstream activities comprise extraction, processing, and transporting fuels to the site of combustion. The analysis of electric power sector emissions of CO2, NOX, SO2, and Hg uses emissions factors intended to represent the marginal impacts of the change in electricity consumption associated with amended or new standards. The methodology is based on results published for the AEO, including DOE’s no-new-standards case for the electric power sector reflects the AEO, which incorporates the projected impacts of existing air quality regulations on emissions. AEO2021 generally represents current legislation and environmental regulations, including recent government actions, that were in place at the time of preparation of AEO 2021, including the emissions control programs discussed in the following paragraphs.65 VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 1. Air Quality Regulations Incorporated in DOE’s Analysis 63 Available at www.epa.gov/sites/production/ files/2021-04/documents/emission-factors_ apr2021.pdf (last accessed July 12, 2021). 64 U.S. Environmental Protection Agency. External Combustion Sources. In Compilation of Air Pollutant Emission Factors. AP–42. Fifth Edition. Volume I: Stationary Point and Area Sources. Chapter 1. Available at www.epa.gov/ttn/chief/ ap42/ (last accessed July 12, 2021). 65 For further information, see the Assumptions to AEO2021 report that sets forth the major assumptions used to generate the projections in the Annual Energy Outlook. Available at www.eia.gov/ outlooks/aeo/assumptions/ (last accessed November 8, 2021). PO 00000 Frm 00041 Fmt 4701 Sfmt 4702 51773 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’’). (42 U.S.C. 7651 et seq.) SO2 emissions from numerous States in the eastern half of the United States are also limited under the CrossState Air Pollution Rule (‘‘CSAPR’’). 76 FR 48208 (Aug. 8, 2011). CSAPR requires these States to reduce certain emissions, including annual SO2 emissions, and went into effect as of January 1, 2015.66 AEO2021 incorporates implementation of CSAPR, including the update to the CSAPR ozone season program emission budgets and target dates issued in 2016. 81 FR 74504 (Oct. 26, 2016). Compliance with CSAPR is flexible among EGUs and is enforced through the use of tradable emissions allowances. 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 another regulated EGU. However, beginning in 2016, SO2 emissions began to fall as a result of implementation the Mercury and Air Toxics Standards (‘‘MATS’’) for power plants. 77 FR 9304 (Feb. 16, 2012). In the MATS final 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 are being reduced as a result of the control technologies installed on coal-fired power plants to comply with the MATS requirements for acid gas. In order to continue operating, coal power plants must have either flue gas desulfurization or dry sorbent injection systems installed. Both technologies, which are used to reduce 66 CSAPR requires states to address annual emissions of SO2 and NOX, precursors to the formation of fine particulate matter (PM2.5) pollution, in order to address the interstate transport of pollution with respect to the 1997 and 2006 PM2.5 National Ambient Air Quality Standards (‘‘NAAQS’’). CSAPR also requires certain states to address the ozone season (May-September) emissions of NOX, a precursor to the formation of ozone pollution, in order to address the interstate transport of ozone pollution with respect to the 1997 ozone NAAQS. 76 FR 48208 (Aug. 8, 2011). EPA subsequently issued a supplemental rule that included an additional five states in the CSAPR ozone season program; 76 FR 80760 (Dec. 27, 2011) (Supplemental Rule). E:\FR\FM\23AUP2.SGM 23AUP2 51774 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules lotter on DSK11XQN23PROD with PROPOSALS2 acid gas emissions, also reduce SO2 emissions. Because of the emissions reductions under the MATS, 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 another regulated EGU. Therefore, energy conservation standards that decrease electricity generation would generally reduce SO2 emissions. DOE estimated SO2 emissions reduction using emissions factors based on AEO2021. CSAPR also established limits on NOX emissions for numerous States in the eastern half of the United States. Energy conservation standards would have little effect on NOX emissions in those States covered by CSAPR emissions limits if excess NOX emissions allowances resulting from the lower electricity demand could be used to permit offsetting increases in NOX emissions from other EGUs. In such case, NOx emissions would remain near the limit even if electricity generation goes down. A different case could possibly result, depending on the configuration of the power sector in the different regions and the need for allowances, such that NOX emissions might not remain at the limit in the case of lower electricity demand. In this case, energy conservation standards might reduce NOX emissions in covered States. Despite this possibility, DOE has chosen to be conservative in its analysis and has maintained the assumption that standards will not reduce NOX emissions in States covered by CSAPR. Energy conservation standards would be expected to reduce NOX emissions in the States not covered by CSAPR. DOE used AEO2021 data to derive NOX emissions factors for the group of States not covered by CSAPR. DOE used AEO2021 data to derive NOX emissions factors for the group of States not covered by CSAPR. The MATS limit mercury emissions from power plants, but they do not include emissions caps and, as such, DOE’s energy conservation standards would be expected to slightly reduce Hg emissions. DOE estimated mercury emissions reduction using emissions factors based on AEO2021, which incorporates the MATS. L. Monetizing Emissions Impacts As part of the development of this proposed rule, for the purpose of complying with the requirements of Executive Order 12866, DOE considered the estimated monetary benefits from the reduced emissions of CO2, CH4, N2O, NOX, and SO2 that are expected to result from each of the TSLs considered. In VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 order to make this calculation analogous to the calculation of the NPV of consumer benefit, DOE considered the reduced emissions expected to result over the lifetime of products shipped in the projection period for each TSL. This section summarizes the basis for the values used for monetizing the emissions benefits and presents the values used for this NOPR. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22–30087) granted the Federal government’s emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued in Louisiana v. Biden, No. 21–cv–1074– JDC–KK (W.D. La.). As a result of the Fifth Circuit’s order, the preliminary injunction is no longer in effect, pending resolution of the Federal government’s appeal of that injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in that case from ‘‘adopting, employing, treating as binding, or relying upon’’ the interim estimates of the social cost of greenhouse gases—which were issued by the Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 2021—to monetize the benefits of reducing greenhouse gas emissions. As reflected in this rule, DOE has reverted to its approach prior to the injunction and presents monetized greenhouse gas abatement benefits where appropriate and permissible under law. DOE requests comment on how to address the climate benefits of the proposal. 1. Monetization of Greenhouse Gas Emissions DOE estimates the monetized benefits of the reductions in emissions of CO2, CH4, and N2O by using a measure of the SC of each pollutant (e.g., SC–CO2). These estimates represent the monetary value of the net harm to society associated with a marginal increase in emissions of these pollutants in a given year, or the benefit of avoiding that increase. These estimates are intended to include (but are not limited to) climate-change-related changes in net agricultural productivity, human health, property damages from increased flood risk, disruption of energy systems, risk of conflict, environmental migration, and the value of ecosystem services. DOE exercises its own judgment in presenting monetized climate benefits as recommended by applicable Executive Orders, and DOE would reach the same conclusion presented in this notice in the absence of the social cost of greenhouse gases. That is, the social costs of greenhouse gases, whether PO 00000 Frm 00042 Fmt 4701 Sfmt 4702 measured using the February 2021 Interim Estimates presented by the Interagency Working Group on the Social Cost of Greenhouse Gases or by another means, did not affect the rule ultimately proposed by DOE. DOE estimated the global social benefits of CO2, CH4, and N2O reductions (i.e., SC–GHGs) using the estimates presented in the Technical Support Document: Social Cost of Carbon, Methane, and Nitrous Oxide Interim Estimates under Executive Order 13990 published in February 2021 by the IWG.67 The SC–GHGs is the monetary value of the net harm to society associated with a marginal increase in emissions in a given year, or the benefit of avoiding that increase. In principle, SC–GHGs includes the value of all climate change impacts, including (but not limited to) changes in net agricultural productivity, human health effects, property damage from increased flood risk and natural disasters, disruption of energy systems, risk of conflict, environmental migration, and the value of ecosystem services. The SC–GHGs therefore, reflects the societal value of reducing emissions of the gas in question by one metric ton. The SC– GHGs is the theoretically appropriate value to use in conducting benefit-cost analyses of policies that affect CO2, N2O and CH4 emissions. As a member of the IWG involved in the development of the February 2021 SC–GHG TSD, the DOE agrees that the interim SC–GHG estimates represent the most appropriate estimate of the SC–GHG until revised estimates have been developed reflecting the latest, peer-reviewed science. The SC–GHGs estimates presented here were developed over many years, using transparent process, peerreviewed methodologies, the best science available at the time of that process, and with input from the public. Specifically, in 2009, the IWG, that included the DOE and other executive branch agencies and offices was established to ensure that agencies were using the best available science and to promote consistency in the social cost of carbon (SC–CO2) values used across agencies. The IWG published SC–CO2 estimates in 2010 that were developed from an ensemble of three widely cited integrated assessment models (‘‘IAMs’’) 67 See Interagency Working Group on Social Cost of Greenhouse Gases, Technical Support Document: Social Cost of Carbon, Methane, and Nitrous Oxide. Interim Estimates Under Executive Order 13990, Washington, DC, February 2021 (Available at: www.whitehouse.gov/wp-content/uploads/2021/02/ TechnicalSupportDocument_ SocialCostofCarbonMethaneNitrousOxide.pdf) (Last accessed Jan. 18, 2022). E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules lotter on DSK11XQN23PROD with PROPOSALS2 that estimate global climate damages using highly aggregated representations of climate processes and the global economy combined into a single modeling framework. The three IAMs were run using a common set of input assumptions in each model for future population, economic, and CO2 emissions growth, as well as equilibrium climate sensitivity—a measure of the globally averaged temperature response to increased atmospheric CO2 concentrations. These estimates were updated in 2013 based on new versions of each IAM. In August 2016 the IWG published estimates of the SC–CH4 and SC–N2O using methodologies that are consistent with the methodology underlying the SC– CO2 estimates. The modeling approach that extends the IWG SC–CO2 methodology to non-CO2 GHGs has undergone multiple stages of peer review. The SC–CH4 and SC–N2O estimates were developed by Marten et al.68 and underwent a standard doubleblind peer review process prior to journal publication. In 2015, as part of the response to public comments received to a 2013 solicitation for comments on the SC–CO2 estimates, the IWG announced a National Academies of Sciences, Engineering, and Medicine review of the SC–CO2 estimates to offer advice on how to approach future updates to ensure that the estimates continue to reflect the best available science and methodologies. In January 2017, the National Academies released their final report, Valuing Climate Damages: Updating Estimation of the Social Cost of Carbon Dioxide, and recommended specific criteria for future updates to the SC–CO2 estimates, a modeling framework to satisfy the specified criteria, and both near-term updates and longer-term research needs pertaining to various components of the estimation process (National Academies, 2017).69 Shortly thereafter, in March 2017, President Trump issued Executive Order 13783, which disbanded the IWG, withdrew the previous TSDs, and directed agencies to ensure SC–CO2 estimates used in regulatory analyses are consistent with the guidance contained in OMB’s Circular A–4, ‘‘including with respect to the consideration of domestic versus 68 Marten, A.L., E.A. Kopits, C.W. Griffiths, S.C. Newbold, and A. Wolverton. Incremental CH4 and N2O mitigation benefits consistent with the US Government’s SC–CO2 estimates. Climate Policy. 2015. 15(2): pp. 272–298. 69 National Academies of Sciences, Engineering, and Medicine. Valuing Climate Damages: Updating Estimation of the Social Cost of Carbon Dioxide. 2017. The National Academies Press: Washington, DC. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 international impacts and the consideration of appropriate discount rates’’ (E.O. 13783, Section 5(c)). Benefit-cost analyses following E.O. 13783 used SC–GHG estimates that attempted to focus on the U.S.-specific share of climate change damages as estimated by the models and were calculated using two discount rates recommended by Circular A–4, 3 percent and 7 percent. All other methodological decisions and model versions used in SC–GHG calculations remained the same as those used by the IWG in 2010 and 2013, respectively. On January 20, 2021, President Biden issued Executive Order 13990, which reestablished the IWG and directed it to ensure that the U.S. Government’s estimates of the social cost of carbon and other greenhouse gases reflect the best available science and the recommendations of the National Academies (2017). The IWG was tasked with first reviewing the SC–GHG estimates currently used in Federal analyses and publishing interim estimates within 30 days of the E.O. that reflect the full impact of GHG emissions, including by taking global damages into account. The interim SC– GHG estimates published in February 2021 are used here to estimate the climate benefits for this proposed rulemaking. The E.O. instructs the IWG to undertake a fuller update of the SC– GHG estimates by January 2022 that takes into consideration the advice of the National Academies (2017) and other recent scientific literature. The February 2021 SC–GHG TSD provides a complete discussion of the IWG’s initial review conducted under E.O. 13990. In particular, the IWG found that the SC–GHG estimates used under E.O. 13783 fail to reflect the full impact of GHG emissions in multiple ways. First, the IWG found that the SC–GHG estimates used under E.O. 13783 fail to fully capture many climate impacts that affect the welfare of U.S. citizens and residents, and those impacts are better reflected by global measures of the SC– GHG. Examples of effects omitted from the E.O. 13783 estimates include direct effects on U.S. citizens, assets, and investments located abroad, supply chains, U.S. military assets and interests abroad, and tourism, and spillover pathways such as economic and political destabilization and global migration that can lead to adverse impacts on U.S. national security, public health, and humanitarian concerns. In addition, assessing the benefits of U.S. GHG mitigation activities requires consideration of how those actions may affect mitigation activities by other countries, as those PO 00000 Frm 00043 Fmt 4701 Sfmt 4702 51775 international mitigation actions will provide a benefit to U.S. citizens and residents by mitigating climate impacts that affect U.S. citizens and residents. A wide range of scientific and economic experts have emphasized the issue of reciprocity as support for considering global damages of GHG emissions. If the United States does not consider impacts on other countries, it is difficult to convince other countries to consider the impacts of their emissions on the United States. The only way to achieve an efficient allocation of resources for emissions reduction on a global basis— and so benefit the U.S. and its citizens— is for all countries to base their policies on global estimates of damages. As a member of the IWG involved in the development of the February 2021 SC– GHG TSD, DOE agrees with this assessment and, therefore, in this proposed rule DOE centers attention on a global measure of SC–GHG. This approach is the same as that taken in DOE regulatory analyses from 2012 through 2016. A robust estimate of climate damages that accrue only to U.S. citizens and residents does not currently exist in the literature. As explained in the February 2021 TSD, existing estimates are both incomplete and an underestimate of total damages that accrue to the citizens and residents of the U.S. because they do not fully capture the regional interactions and spillovers discussed above, nor do they include all of the important physical, ecological, and economic impacts of climate change recognized in the climate change literature. As noted in the February 2021 SC–GHG TSD, the IWG will continue to review developments in the literature, including more robust methodologies for estimating a U.S.-specific SC–GHG value, and explore ways to better inform the public of the full range of carbon impacts. As a member of the IWG, DOE will continue to follow developments in the literature pertaining to this issue. Second, the IWG found that the use of the social rate of return on capital (7 percent under current OMB Circular A– 4 guidance) to discount the future benefits of reducing GHG emissions inappropriately underestimates the impacts of climate change for the purposes of estimating the SC–GHG. Consistent with the findings of the National Academies (2017) and the economic literature, the IWG continued to conclude that the consumption rate of interest is the theoretically appropriate discount rate in an intergenerational context (IWG 2010, 2013, 2016a, E:\FR\FM\23AUP2.SGM 23AUP2 51776 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules lotter on DSK11XQN23PROD with PROPOSALS2 2016b),70 and recommended that discount rate uncertainty and relevant aspects of intergenerational ethical considerations be accounted for in selecting future discount rates. Furthermore, the damage estimates developed for use in the SC–GHG are estimated in consumption-equivalent terms, and so an application of OMB Circular A–4’s guidance for regulatory analysis would then use the consumption discount rate to calculate the SC–GHG. DOE agrees with this assessment and will continue to follow developments in the literature pertaining to this issue. DOE also notes that while OMB Circular A–4, as published in 2003, recommends using 3 percent and 7 percent discount rates as ‘‘default’’ values, Circular A–4 also reminds agencies that ‘‘different regulations may call for different emphases in the analysis, depending on the nature and complexity of the regulatory issues and the sensitivity of the benefit and cost estimates to the key assumptions.’’ On discounting, Circular A–4 recognizes that ‘‘special ethical considerations arise when comparing benefits and costs across generations,’’ and Circular A–4 acknowledges that analyses may appropriately ‘‘discount future costs and consumption benefits . . . at a lower rate than for intragenerational analysis.’’ In the 2015 Response to Comments on the Social Cost of Carbon for Regulatory Impact Analysis, OMB, DOE, and the other IWG members recognized that ‘‘Circular A–4 is a living document’’ and ‘‘the use of 7 percent is not considered appropriate for intergenerational discounting. There 70 Interagency Working Group on Social Cost of Carbon. Social Cost of Carbon for Regulatory Impact Analysis under Executive Order 12866. 2010. United States Government. (Available at: www.epa.gov/sites/default/files/2016-12/ documents/scc_tsd_2010.pdf) (Last accessed April 15, 2022.); Interagency Working Group on Social Cost of Carbon. Technical Update of the Social Cost of Carbon for Regulatory Impact Analysis Under Executive Order 12866. 2013. (Available at: www.federalregister.gov/documents/2013/11/26/ 2013-28242/technical-support-document-technicalupdate-of-the-social-cost-of-carbon-for-regulatoryimpact) (Last accessed April 15, 2022.); Interagency Working Group on Social Cost of Greenhouse Gases, United States Government. Technical Support Document: Technical Update on the Social Cost of Carbon for Regulatory Impact Analysis-Under Executive Order 12866. August 2016. (Available at: www.epa.gov/sites/default/files/2016-12/ documents/sc_co2_tsd_august_2016.pdf) (Last accessed January 18, 2022.); Interagency Working Group on Social Cost of Greenhouse Gases, United States Government. Addendum to Technical Support Document on Social Cost of Carbon for Regulatory Impact Analysis under Executive Order 12866: Application of the Methodology to Estimate the Social Cost of Methane and the Social Cost of Nitrous Oxide. August 2016. (Available at: www.epa.gov/sites/default/files/2016-12/ documents/addendum_to_sc-ghg_tsd_august_ 2016.pdf) (Last accessed January 18, 2022.). VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 is wide support for this view in the academic literature, and it is recognized in Circular A–4 itself.’’ Thus, DOE concludes that a 7-percent discount rate is not appropriate to apply to value the social cost of greenhouse gases in the analysis presented herein. In this analysis, to calculate the present and annualized values of climate benefits, DOE uses the same discount rate as the rate used to discount the value of damages from future GHG emissions, for internal consistency. That approach to discounting follows the same approach that the February 2021 TSD recommends ‘‘to ensure internal consistency—i.e., future damages from climate change using the SC–GHG at 2.5 percent should be discounted to the base year of the analysis using the same 2.5-percent rate.’’ DOE has also consulted the National Academies’ 2017 recommendations on how SC–GHG estimates can ‘‘be combined in RIAs with other cost and benefits estimates that may use different discount rates.’’ The National Academies reviewed ‘‘several options,’’ including ‘‘presenting all discount rate combinations of other costs and benefits with [SC–GHG] estimates.’’ As a member of the IWG involved in the development of the February 2021 SC–GHG TSD, DOE agrees with this assessment and will continue to follow developments in the literature pertaining to this issue. While the IWG works to assess how best to incorporate the latest, peer reviewed science to develop an updated set of SC–GHG estimates, it set the interim estimates to be the most recent estimates developed by the IWG prior to the group being disbanded in 2017. The estimates rely on the same models and harmonized inputs and are calculated using a range of discount rates. As explained in the February 2021 SC– GHG TSD, the IWG has recommended that agencies revert to the same set of four values drawn from the SC–GHG distributions based on three discount rates as were used in regulatory analyses between 2010 and 2016 and subject to public comment. For each discount rate, the IWG combined the distributions across models and socioeconomic emissions scenarios (applying equal weight to each) and then selected a set of four values recommended for use in benefit-cost analyses: an average value resulting from the model runs for each of three discount rates (2.5 percent, 3 percent, and 5 percent), plus a fourth value, selected as the 95th percentile of estimates based on a 3 percent discount rate. The fourth value was included to provide information on potentially higher-than-expected economic impacts PO 00000 Frm 00044 Fmt 4701 Sfmt 4702 from climate change. As explained in the February 2021 SC–GHG TSD, and DOE agrees, this update reflects the immediate need to have an operational SC–GHG for use in regulatory benefitcost analyses and other applications that was developed using a transparent process, peer-reviewed methodologies, and the science available at the time of that process. Those estimates were subject to public comment in the context of dozens of proposed rulemakings as well as in a dedicated public comment period in 2013. There are a number of limitations and uncertainties associated with the SC– GHG estimates. First, the current scientific and economic understanding of discounting approaches suggests discount rates appropriate for intergenerational analysis in the context of climate change are likely to be less than 3 percent, near 2 percent or lower.71 Second, the IAMs used to produce these interim estimates do not include all of the important physical, ecological, and economic impacts of climate change recognized in the climate change literature and the science underlying their ‘‘damage functions’’—i.e., the core parts of the IAMs that map global mean temperature changes and other physical impacts of climate change into economic (both market and nonmarket) damages—lags behind the most recent research. For example, limitations include the incomplete treatment of catastrophic and non-catastrophic impacts in the integrated assessment models, their incomplete treatment of adaptation and technological change, the incomplete way in which inter-regional and intersectoral linkages are modeled, uncertainty in the extrapolation of damages to high temperatures, and inadequate representation of the relationship between the discount rate and uncertainty in economic growth over long time horizons. Likewise, the socioeconomic and emissions scenarios used as inputs to the models do not reflect new information from the last decade of scenario generation or the full range of projections. The modeling limitations do not all work in the same direction in terms of their influence on the SC–CO2 estimates. However, as discussed in the February 2021 TSD, the IWG has concluded that, taken together, 71 Interagency Working Group on Social Cost of Greenhouse Gases (IWG). 2021. Technical Support Document: Social Cost of Carbon, Methane, and Nitrous Oxide Interim Estimates under Executive Order 13990. February. United States Government. (Available at: www.whitehouse.gov/briefing-room/ blog/2021/02/26/a-return-to-science-evidencebased-estimates-of-the-benefits-of-reducing-climatepollution/) (Last accessed Jan. 18, 2022). E:\FR\FM\23AUP2.SGM 23AUP2 51777 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules the limitations suggest that the interim SC–GHG estimates used in this proposed rule likely underestimate the damages from GHG emissions. DOE concurs with this assessment. DOE’s derivations of the SC–GHG (i.e., SC–CO2, SC–N2O, and SC–CH4) values used for this NOPR are discussed in the following sections, and the results of DOE’s analyses estimating the benefits of the reductions in emissions of these pollutants are presented in section V.B.6 of this document. a. Social Cost of Carbon The SC–CO2 values used for this NOPR were based on the values presented in the 2021 update from the IWG’s February 2021 TSD. Table IV.34 shows the updated sets of SC–CO2 estimates from the latest interagency update in 5-year increments from 2020 to 2050. The full set of annual values used is presented in appendix 14A of the NOPR TSD. For purposes of capturing the uncertainties involved in regulatory impact analysis, DOE has determined it is appropriate to include all four sets of SC–CO2 values, as recommended by the IWG.72 TABLE IV.34—ANNUAL SC–CO2 VALUES FROM 2021 INTERAGENCY UPDATE, 2020–2050 (2020$ PER METRIC TON CO2) Discount rate 5% 3% 2.5% 3% Average Average Average 95th percentile Year 2020 2025 2030 2035 2040 2045 2050 ................................................................................................................. ................................................................................................................. ................................................................................................................. ................................................................................................................. ................................................................................................................. ................................................................................................................. ................................................................................................................. In calculating the potential global benefits resulting from reduced CO2 emissions, DOE used the values from the 2021 interagency report, adjusted to 2020$ using the implicit price deflator for gross domestic product (‘‘GDP’’) from the Bureau of Economic Analysis. For 2051 to 2070, DOE used estimates published by EPA, adjusted to 2020$. These estimates are based on methods, assumptions, and parameters identical to the 2020–2050 estimates published by the IWG. DOE expects additional climate benefits to accrue for any longer-life consumer clothes dryers post 2070, but a lack of available SC–CO2 estimates for emissions years beyond 2070 prevents DOE from monetizing these potential benefits in this analysis. 14 17 19 22 25 28 32 If further analysis of monetized climate benefits beyond 2070 becomes available prior to the publication of the final rule, DOE will include that analysis in the final rule. DOE multiplied the CO2 emissions reduction estimated for each year by the SC–CO2 value for that year in each of the four cases. To calculate a present value of the stream of monetary values, DOE discounted the values in each of the four cases using the specific discount rate that had been used to obtain the SC–CO2 values in each case. See chapter 13 for the annual emissions reduction. See appendix 14A for the annual SC–CO2 values. 51 56 62 67 73 79 85 76 83 89 96 103 110 116 152 169 187 206 225 242 260 b. Social Cost of Methane and Nitrous Oxide The SC–CH4 and SC–N2O values used for this NOPR were generated using the values presented in the 2021 update from the IWG.73 Table IV.35 shows the updated sets of SC–CH4 and SC–N2O estimates from the latest interagency update in 5-year increments from 2020 to 2050. The full set of annual values used is presented in appendix 14A of the NOPR TSD. To capture the uncertainties involved in regulatory impact analysis, DOE has determined it is appropriate to include all four sets of SC–CH4 and SC–N2O values, as recommended by the IWG. DOE used the same approach described above for the SC–CO2 for values after 2050. TABLE IV.35—ANNUAL SC–CH4 AND SC–N2O VALUES FROM 2021 INTERAGENCY UPDATE, 2020–2050 [2020$ per metric ton] SC–CH4 SC–N2O Discount rate and statistic lotter on DSK11XQN23PROD with PROPOSALS2 Year 2020 2025 2030 2035 2040 2045 2050 5% 3% 2.5% Average Average Average 95th percentile .................................................................. .................................................................. .................................................................. .................................................................. .................................................................. .................................................................. .................................................................. 670 800 940 1100 1300 1500 1700 72 For example, the February 2021 TSD discusses how the understanding of discounting approaches suggests that discount rates appropriate for intergenerational analysis in the context of climate change may be lower than 3 percent. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 Discount rate and statistic 3% 1500 1700 2000 2200 2500 2800 3100 2000 2200 2500 2800 3100 3500 3800 3900 4500 5200 6000 6700 7500 8200 73 See Interagency Working Group on Social Cost of Greenhouse Gases, Technical Support Document: Social Cost of Carbon, Methane, and Nitrous Oxide. Interim Estimates Under Executive Order 13990, Washington, DC (February 2021) (Available at: PO 00000 Frm 00045 Fmt 4701 Sfmt 4702 5% 3% 2.5% 3% Average Average Average 95th percentile 5800 6800 7800 9000 10000 12000 13000 18000 21000 23000 25000 28000 30000 33000 27000 30000 33000 36000 39000 42000 45000 48000 54000 60000 67000 74000 81000 88000 www.whitehouse.gov/wp-content/uploads/2021/02/ TechnicalSupportDocument_ SocialCostofCarbonMethaneNitrousOxide.pdf) (Last accessed Jan. 18, 2022). E:\FR\FM\23AUP2.SGM 23AUP2 51778 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules DOE multiplied the CH4 and N2O emissions reduction estimated for each year by the SC–CH4 and SC–N2O estimates for that year in each of the cases. To calculate a present value of the stream of monetary values, DOE discounted the values in each of the cases using the specific discount rate that had been used to obtain the SC–CH4 and SC–N2O estimates in each case. See chapter 13 for the annual emissions reduction. See appendix 14A for the annual SC–CH4 and SC–N2O values. lotter on DSK11XQN23PROD with PROPOSALS2 2. Monetization of Other Air Pollutants DOE estimated the monetized value of NOX and SO2 emissions reductions from electricity generation using the latest benefit-per-ton estimates for that sector from the EPA’s Benefits Mapping and Analysis Program.74 DOE used EPA’s values for PM2.5-related benefits associated with NOX and SO2 and for ozone-related benefits associated with NOX for 2025, 2030, 2035 and 2040, calculated with discount rates of 3 percent and 7 percent. DOE used linear interpolation to define values for the years not given in the 2025 to 2040 period; for years beyond 2040 the values are held constant. DOE derived values specific to the sector for consumer clothes dryers using a method described in appendix 14A of the NOPR TSD. DOE also estimated the monetized value of NOX and SO2 emissions reductions from site use of natural gas in consumer clothes dryers using benefit-per-ton estimates from the EPA’s Benefits Mapping and Analysis Program. Although none of the sectors covered by EPA refers specifically to residential and commercial buildings, the sector called ‘‘area sources’’ would be a reasonable proxy for residential and commercial buildings.75 The EPA document provides high and low estimates for 2025 and 2030 at 3- and 7percent discount rates.76 DOE used the same linear interpolation and extrapolation as it did with the values for electricity generation. DOE multiplied the site emissions reduction (in tons) in each year by the 74 U.S. Environmental Protection Agency, Estimating the Benefit per Ton of Reducing PM2.5 Precursors from 21 Sectors. Available at: www.epa.gov/benmap/estimating-benefit-tonreducing-pm25-precursors-21-sectors. 75 ‘‘Area sources’’ represents all emission sources for which states do not have exact (point) locations in their emissions inventories. Because exact locations would tend to be associated with larger sources, ‘‘area sources’’ would be fairly representative of small dispersed sources like homes and businesses. 76 ‘‘Area sources’’ are a category in the 2018 document from EPA, but are not used in the 2021 document cited above. Available at: www.epa.gov/ sites/default/files/2018-02/documents/ sourceapportionmentbpttsd_2018.pdf. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 associated $/ton values, and then discounted each series using discount rates of 3 percent and 7 percent as appropriate. M. Utility Impact Analysis The utility impact analysis estimates several effects on the electric power generation industry that would result from the adoption of new or amended energy conservation standards. The utility impact analysis estimates the changes in installed electrical capacity and generation that would result for each TSL. The analysis is based on published output from the NEMS associated with AEO2021. NEMS produces the AEO Reference case, as well as a number of side cases that estimate the economy-wide impacts of changes to energy supply and demand. For the current analysis, impacts are quantified by comparing the levels of electricity sector generation, installed capacity, fuel consumption and emissions in the AEO2020 Reference case and various side cases. Details of the methodology are provided in the appendices to chapters 13 and 15 of the NOPR TSD. The output of this analysis is a set of time-dependent coefficients that capture the change in electricity generation, primary fuel consumption, installed capacity and power sector emissions due to a unit reduction in demand for a given end use. These coefficients are multiplied by the stream of electricity savings calculated in the NIA to provide estimates of selected utility impacts of potential new or amended energy conservation standards. N. Employment Impact Analysis DOE considers employment impacts in the domestic economy as one factor in selecting a proposed standard. Employment impacts from new or amended energy conservation standards include both direct and indirect impacts. Direct employment impacts are any changes in the number of production and non-production employees of manufacturers of the products subject to standards.77 The 77 As defined in the U.S. Census Bureau’s 2016 Annual Survey of Manufactures, production workers include ‘‘Workers (up through the linesupervisor level) engaged in fabricating, processing, assembling, inspecting, receiving, packing, warehousing, shipping (but not delivering), maintenance, repair, janitorial, guard services, product development, auxiliary production for plant’s own use (e.g., power plant), record keeping, and other closely associated services (including truck drivers delivering ready-mixed concrete)’’ Non-production workers are defined as ‘‘Supervision above line-supervisor level, sales (including a driver salesperson), sales delivery (truck drivers and helpers), advertising, credit, collection, installation, and servicing of own PO 00000 Frm 00046 Fmt 4701 Sfmt 4702 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 net jobs created or eliminated in the national economy, other than in the manufacturing sector being regulated, caused by (1) reduced spending by consumers on energy, (2) reduced spending on new energy supply by the utility industry, (3) increased consumer spending on the products to which the new standards apply and other goods and services, 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 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.78 There are many reasons for these differences, including wage differences and the fact that the utility sector is more capitalintensive and less labor-intensive than other sectors. Energy conservation standards have the effect of reducing consumer utility bills. Because reduced consumer 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 laborintensive sector (i.e., the utility sector) to more labor-intensive sectors (e.g., the retail and service sectors). Thus, the BLS data suggest that net national employment may increase due to shifts in economic activity resulting from energy conservation standards. DOE estimated indirect national employment impacts for the standard levels considered in this NOPR using an input/output model of the U.S. economy called Impact of Sector Energy products, clerical and routine office functions, executive, purchasing, finance, legal, personnel (including cafeteria, etc.), professional and technical.’’ 78 See U.S. Department of Commerce–Bureau of Economic Analysis. Regional Multipliers: A User Handbook for the Regional Input-Output Modeling System (RIMS II). 1997. U.S. Government Printing Office: Washington, DC. Available at www.bea.gov/ scb/pdf/regional/perinc/meth/rims2.pdf (last accessed November 9, 2021). E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules Technologies version 4 (‘‘ImSET’’).79 ImSET is a special-purpose version of the ‘‘U.S. Benchmark National InputOutput’’ (‘‘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 187 sectors most relevant to industrial, commercial, and residential building energy use. DOE notes that ImSET is not a general equilibrium forecasting model, and that 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 this rule. Therefore, DOE used ImSET only to generate results for near-term timeframes (2027–2033), where these uncertainties are reduced. For more details on the employment impact analysis, see chapter 16 of the NOPR TSD. V. Analytical Results and Conclusions The following section addresses the results from DOE’s analyses with respect to the considered energy conservation standards for consumer clothes dryers. It addresses the TSLs examined by DOE, the projected impacts of each of these levels if adopted as energy conservation standards for consumer clothes dryers, and the standards levels that DOE is proposing to adopt in this NOPR. Additional details regarding DOE’s analyses are contained in the NOPR TSD supporting this document. A. Trial Standard Levels In general, DOE typically evaluates potential amended standards for products and equipment at the product class level and by grouping select individual efficiency levels for each class into TSLs. Use of TSLs allows DOE to identify and consider manufacturer cost interactions between the equipment classes, to the extent that there are such interactions, and market cross elasticity from consumer purchasing decisions that may change when different standard levels are set. In addition, the use of TSLs allows DOE to account for shifts in manufacturing practices, such as consolidation or expansion of manufacturing lines that may occur as a result of differential efficiency levels set for different product classes. In the case of consumer clothes dryers, DOE did not find any cross elasticities in the marketplace and DOE does not believe consumers would modify their purchasing decisions to change to different categories of consumer clothes dryers due to the imposition of standards. DOE also believes that manufacturers will continue producing compact and standard size clothes dryers on different product lines due to 51779 their significantly different platforms and production quantities. DOE presents the results for the TSLs in this document, while the results for all efficiency levels that DOE analyzed are in the NOPR TSD. Table V.1 presents the TSLs and the corresponding efficiency levels that DOE has identified for potential amended energy conservation standards for consumer clothes dryers. TSL 6 represents the maximum technologically feasible (‘‘max-tech’’) energy efficiency for all product classes. TSL 5 represents the maximum national energy savings with positive NPV. TSL 4 represents the maximum national energy savings with simple PBP less than 4 years. TSL 3 represents the intermediate efficiency level between TSL 2 and TSL 4. TSL 2 corresponds to efficiency level with automatic termination control system for product class (‘‘PC’’)1 to PC6 and high-speed spin for PC7. TSL 1 corresponds to efficiency level with electronic controls for all product classes. DOE constructed the TSLs for this NOPR to include ELs representative of ELs with similar characteristics (i.e., using similar technologies and/or efficiencies, and having roughly comparable equipment availability). The use of representative ELs provided for greater distinction between the TSLs. While representative ELs were included in the TSLs, DOE considered all efficiency levels as part of its analysis but did not include all efficiency levels in the TSLs.80 TABLE V.1—TRIAL STANDARD LEVELS FOR CONSUMER CLOTHES DRYER Product class TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 TSL 6 7 5 5 3 3 1 1 7 6 6 4 4 2 2 Efficiency level and representative CEFD2 (lb/kWh) Electric Standard ............................ Electric Compact (120V) ................. Vented Electric Compact (240V) .... Vented Gas Standard ..................... Vented Gas Compact ..................... Ventless Electric Compact (240V) .. Ventless Electric Combination Washer-Dryer. 1 (2.68) .............. 1 (3.15) .............. 1 (2.44) .............. 1 (2.44) .............. 1 (2.02) .............. Baseline (2.03) ... Baseline (2.27) ... B. Economic Justification and Energy Savings lotter on DSK11XQN23PROD with PROPOSALS2 DOE analyzed the economic impacts on consumers of consumer clothes dryers by looking at the effects that potential amended standards at each 79 Livingston, O.V., S.R. Bender, M.J. Scott, and R.W. Schultz. ImSET 4.0: Impact of Sector Energy Technologies Model Description and User Guide. 19:56 Aug 22, 2022 Jkt 256001 (3.27) (4.28) (3.30) (3.00) (2.49) (2.68) (2.33) 4 4 4 3 1 1 1 (3.93) (4.33) (3.57) (3.48) (2.02) (2.68) (2.33) 5 (4.21) .............. 4 (4.33) .............. 4 (3.57) .............. 3 (3.48) .............. Baseline (1.66) ... 1 (2.68) .............. 1 (2.33) .............. TSL would have on the LCC and PBP. DOE also examined the impacts of potential standards on selected consumer subgroups. These analyses are discussed in the following sections. 1. Economic Impacts on Individual Consumers VerDate Sep<11>2014 3 3 3 2 2 1 1 a. Life-Cycle Cost and Payback Period In general, higher-efficiency products affect consumers in two ways: (1) 2015. Pacific Northwest National Laboratory: Richland, WA. PNNL–24563. PO 00000 Frm 00047 Fmt 4701 Sfmt 4702 (7.39) (4.63) (3.82) (3.48) (2.89) (2.68) (2.33) (7.39) (6.37) (3.91) (3.83) (3.17) (6.80) (4.01) purchase price increases and (2) annual operating costs decrease. Inputs used for calculating the LCC and PBP include total installed costs (i.e., product price plus installation costs), and operating costs (i.e., annual energy use, energy prices, energy price trends, repair costs, and maintenance costs). The LCC calculation also uses product lifetime 80 Efficiency levels that were analyzed for this NOPR are discussed in section IV.C.3 of this document. Results by efficiency level are presented in the NOPR TSD chapters 8 and 12. E:\FR\FM\23AUP2.SGM 23AUP2 51780 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules and a discount rate. Chapter 8 of the NOPR TSD provides detailed information on the LCC and PBP analyses. Table V.2 through Table V.15 show the LCC and PBP results for the TSLs considered for each product class. In the first of each pair of tables, the simple payback is measured relative to the baseline product. In the second table, impacts are measured relative to the efficiency distribution in the no-newstandards case in the compliance year (see section IV.F.8 of this document). Because some consumers purchase products with higher efficiency in the no-new-standards case, the average savings are less than the difference between the average LCC of the baseline product and the average LCC at each TSL. The savings refer only to consumers who are affected by a standard at a given TSL. Those who already purchase a product with efficiency at or above a given TSL are not affected. Consumers for whom the LCC increases at a given TSL experience a net cost. TABLE V.2—AVERAGE LCC AND PBP RESULTS FOR ELECTRIC STANDARD CONSUMER CLOTHES DRYERS Average costs (2020$) CEFD2 (lb/kWh) TSL Installed cost 1 ............................... 2 ............................... 3 ............................... 4 ............................... 5, 6 .......................... Simple payback (years) Efficiency level 2.20 2.68 3.27 3.93 4.21 7.39 Baseline .................. 1 .............................. 3 .............................. 4 .............................. 5 .............................. 7 .............................. First year’s operating cost Lifetime operating cost $147 122 101 85.3 80.3 50.0 $1,567 1,301 1,085 919 865 537 $607 625 634 641 721 996 LCC $2,174 1,926 1,719 1,560 1,587 1,533 Average lifetime (years) ........................ 0.7 0.6 0.6 1.7 4.0 14.0 14.0 14.0 14.0 14.0 14.0 Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative to the baseline product. TABLE V.3—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR ELECTRIC STANDARD CONSUMER CLOTHES DRYERS Life-cycle cost savings CEFD2 (lb/kWh) TSL 1 ............................................................................................... 2 ............................................................................................... 3 ............................................................................................... 4 ............................................................................................... 5, 6 ........................................................................................... Efficiency level 2.68 3.27 3.93 4.21 7.39 Percent of consumers that experience net cost (%) Average LCC savings * (2020$) 1 3 4 5 7 $252 439 578 182 230 0.32 0.16 0.11 53.5 53.1 * The savings represent the average LCC for affected consumers. TABLE V.4—AVERAGE LCC AND PBP RESULTS FOR ELECTRIC COMPACT (120V) CONSUMER CLOTHES DRYERS Average costs (2020$) CEFD2 (lb/kWh) TSL Installed cost 1 ............................... 2 ............................... 3, 4 .......................... 5 ............................... 6 ............................... Simple payback (years) Efficiency level 2.36 3.15 4.28 4.33 4.63 6.37 Baseline .................. 1 .............................. 3 .............................. 4 .............................. 5 .............................. 6 .............................. First year’s operating cost Lifetime operating cost $54.1 41.0 30.7 30.4 28.6 21.6 $383 297 228 226 215 169 $635 657 670 678 770 993 LCC $1,206 1,090 995 999 1,073 1,222 ........................ 1. 7 1.5 1.8 5.3 11.0 Average lifetime (years) 14.0 14.0 14.0 14.0 14.0 14.0 Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative to the baseline product. TABLE V.5—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR ELECTRIC COMPACT (120V) CONSUMER CLOTHES DRYERS lotter on DSK11XQN23PROD with PROPOSALS2 Life-cycle cost savings CEFD2 (lb/kWh) TSL 1 ............................................................................................... 2 ............................................................................................... 3, 4 ........................................................................................... 5 ............................................................................................... VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00048 Efficiency level 3.15 4.28 4.33 4.63 Fmt 4701 Sfmt 4702 Average LCC savings * (2020$) 1 3 4 5 E:\FR\FM\23AUP2.SGM $115 194 160 86.3 23AUP2 Percent of consumers that experience net cost (%) 5.66 4.46 21.6 53.0 51781 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules TABLE V.5—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR ELECTRIC COMPACT (120V) CONSUMER CLOTHES DRYERS—Continued Life-cycle cost savings CEFD2 (lb/kWh) TSL 6 ............................................................................................... Efficiency level 6.37 Percent of consumers that experience net cost (%) Average LCC savings * (2020$) 6 (62.6) 76.3 * The savings represent the average LCC for affected consumers. Negative values denoted in parentheses. TABLE V.6—AVERAGE LCC AND PBP RESULTS FOR VENTED ELECTRIC COMPACT (240V) CONSUMER CLOTHES DRYERS Average costs (2020$) CEFD2 (lb/kWh) TSL Installed cost 1 ............................... 2 ............................... 3, 4 .......................... 5 ............................... 6 ............................... Simple payback (years) Efficiency level 2.00 2.44 3.30 3.57 3.82 3.91 Baseline .................. 1 .............................. 3 .............................. 4 .............................. 5 .............................. 6 .............................. First year’s operating cost Lifetime operating cost $64.4 53.3 40.2 37.4 35.2 34.8 $682 565 426 396 373 368 $636 659 672 680 772 995 LCC $1,318 1,223 1,098 1,076 1,145 1,363 Average lifetime (years) ........................ 2.0 1.5 1.6 4.7 12.1 14.0 14.0 14.0 14.0 14.0 14.0 Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative to the baseline product. TABLE V.7—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR VENTED ELECTRIC COMPACT (240V) CONSUMER CLOTHES DRYERS Life-cycle cost savings CEFD2 (lb/kWh) TSL 1 ............................................................................................... 2 ............................................................................................... 3, 4 ........................................................................................... 5 ............................................................................................... 6 ............................................................................................... Efficiency level 2.44 3.30 3.57 3.82 3.91 Percent of consumers that experience net cost (%) Average LCC savings * (2020$) 1 3 4 5 6 $94.1 201 192 123 (94.8) 8.63 4.35 8.37 47.0 79.6 * The savings represent the average LCC for affected consumers. Negative values denoted in parentheses. TABLE V.8—AVERAGE LCC AND PBP RESULTS FOR VENTED GAS STANDARD CONSUMER CLOTHES DRYERS Average costs (2020$) CEFD2 (lb/kWh) TSL Installed cost 1 ............................... 2 ............................... 3, 4, 5 ...................... 6 ............................... Simple payback (years) Efficiency level 2.00 2.44 3.00 3.48 3.83 Baseline .................. 1 .............................. 2 .............................. 3 .............................. 4 .............................. First year’s operating cost Lifetime operating cost $60.0 51.5 42.1 37.7 37.5 $689 586 478 426 421 $740 763 768 783 863 LCC $1,429 1,350 1,246 1,209 1,284 Average lifetime (years) — 2.8 1.6 1.9 5.5 14.0 14.0 14.0 14.0 14.0 Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative to the baseline product. TABLE V.9—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR VENTED GAS STANDARD CONSUMER CLOTHES DRYERS lotter on DSK11XQN23PROD with PROPOSALS2 Life-cycle cost savings CEFD2 (lb/kWh) TSL 1 ............................................................................................... 2 ............................................................................................... 3, 4, 5 ....................................................................................... VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00049 Efficiency level 2.44 3.00 3.48 Fmt 4701 Sfmt 4702 Average LCC savings * (2020$) 1 2 3 E:\FR\FM\23AUP2.SGM $77.7 174 198 23AUP2 Percent of consumers that experience net cost (%) 6.04 1.66 3.74 51782 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules TABLE V.9—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR VENTED GAS STANDARD CONSUMER CLOTHES DRYERS—Continued Life-cycle cost savings CEFD2 (lb/kWh) TSL 6 ............................................................................................... Efficiency level 3.83 Percent of consumers that experience net cost (%) Average LCC savings * (2020$) 4 43.0 59.3 * The savings represent the average LCC for affected consumers. TABLE V.10—AVERAGE LCC AND PBP RESULTS FOR VENTED GAS COMPACT CONSUMER CLOTHES DRYERS Average costs (2020$) CEFD2 (lb/kWh) TSL Efficiency level Installed cost 1, 3 .......................... 2 ............................... 4 ............................... 5 ............................... 6 ............................... 1.66 2.02 2.49 1.66 2.89 3.17 Baseline .................. 1 .............................. 2 .............................. Baseline .................. 3 .............................. 4 .............................. First year’s operating cost Lifetime operating cost $27.4 23.4 23.2 27.4 21.2 19.0 $308 263 258 308 235 211 $790 810 817 790 834 926 LCC $1,098 1,073 1,075 1,098 1,069 1,137 Simple payback (years) Average lifetime (years) ........................ 5.1 6.4 ........................ 7.1 16.3 14.0 14.0 14.0 14.0 14.0 14.0 Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative to the baseline product. TABLE V.11—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR VENTED GAS COMPACT CONSUMER CLOTHES DRYERS Life-cycle cost savings CEFD2 (lb/kWh) TSL 1, 3 ........................................................................................... 2 ............................................................................................... 4 ............................................................................................... 5 ............................................................................................... 6 ............................................................................................... Average LCC savings * (2020$) Percent of consumers that experience net cost (%) $25.2 23.5 .................................... 29.4 (38.8) 32.7 50.2 .................................... 51.9 78.8 Efficiency level 2.02 2.49 1.66 2.89 3.17 1 2 Baseline 3 4 * The savings represent the average LCC for affected consumers. Negative values denoted in parentheses. TABLE V.12—AVERAGE LCC AND PBP RESULTS FOR VENTLESS ELECTRIC STANDARD (240V) CONSUMER CLOTHES DRYERS Average costs (2020$) CEFD2 (lb/kWh) TSL Efficiency level Installed cost 1 ............................... 2, 3, 4, 5 .................. 6 ............................... 2.03 2.03 2.68 6.80 Baseline .................. Baseline .................. 1 .............................. 2 .............................. First year’s operating cost Lifetime operating cost $53.8 53.8 38.8 11.7 $567 567 412 123 $1,020 1,020 1,025 1,319 LCC $1,588 1,588 1,438 1,442 Simple payback (years) ........................ ........................ 0.3 7.1 Average lifetime (years) 14.0 14.0 14.0 14.0 Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative to the baseline product. TABLE V.13—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR VENTLESS ELECTRIC STANDARD (240V) CONSUMER CLOTHES DRYERS lotter on DSK11XQN23PROD with PROPOSALS2 Life-cycle cost savings CEFD2 (lb/kWh) TSL 1 ............................................................................................... 2, 3, 4, 5 .................................................................................. 6 ............................................................................................... Efficiency level 2.03 2.68 6.80 Baseline 1 2 Average LCC savings * (2020$) Percent of consumers that experience net cost (%) .................................... $145 11.0 .................................... 0.0 66.4 * The savings represent the average LCC for affected consumers. VerDate Sep<11>2014 20:51 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00050 Fmt 4701 Sfmt 4702 E:\FR\FM\23AUP2.SGM 23AUP2 51783 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules TABLE V.14—AVERAGE LCC AND PBP RESULTS FOR VENTLESS ELECTRIC COMBINATION WASHER-DRYER CONSUMER CLOTHES DRYERS Average costs (2020$) CEFD2 (lb/kWh) TSL Installed cost 1 ............................... 2, 3, 4, 5 .................. 6 ............................... Simple payback (years) Efficiency level 2.27 2.27 2.33 4.01 Baseline .................. Baseline .................. 1 .............................. 2 .............................. First year’s operating cost Lifetime operating cost $48.3 48.3 46.9 25.7 $513 513 498 272 $1,342 1,342 1,342 1,965 LCC $1,855 1,855 1,840 2,237 Average lifetime (years) ........................ ........................ 0.0 27.5 14.0 14.0 14.0 14.0 Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative to the baseline product. TABLE V.15—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR VENTLESS ELECTRIC COMBINATION WASHER-DRYER CONSUMER CLOTHES DRYERS Life-cycle cost savings CEFD2 (lb/kWh) TSL 1 ............................................................................................... 2, 3, 4, 5 .................................................................................. 6 ............................................................................................... Average LCC savings * (2020$) Percent of consumers that experience net cost (%) .................................... 15.1 (387) .................................... 0.0 89.8 Efficiency level 2.27 2.33 4.01 Baseline 1 2 * The savings represent the average LCC for affected consumers. Negative values denoted in parentheses. b. Consumer Subgroup Analysis In the consumer subgroup analysis, DOE estimated the impact of the considered TSLs on low-income households and senior-only households for product classes with a sufficient sample size in RECS to perform a Monte Carlo analysis. DOE was unable to conduct a consumer subgroup analysis for product class—vented gas compact for either low-income households or senior-only households due to insufficient sample size and therefore does not report results for that product class. Table V.16 through Table V.27 compare the average LCC savings, PBP, percent of consumers negatively impacted, and percent of consumers positively impacted at each efficiency level for the consumer subgroups, along with corresponding values for the entire residential consumer sample for product classes with a sufficient sample size. In most cases, the values for low-income households and senior-only households at the considered efficiency levels are not substantially different from the average for all households. Chapter 11 of the NOPR TSD presents the complete LCC and PBP results for the subgroups. TABLE V.16—COMPARISON OF LCC SAVINGS AND PBP FOR CONSUMER SUBGROUPS AND ALL HOUSEHOLDS: ELECTRIC STANDARD CONSUMER CLOTHES DRYERS Average life-cycle cost savings * (2020$) EL Low-income households 1 3 4 5 7 Simple payback period (years) TSL .................................................................... .................................................................... .................................................................... .................................................................... .................................................................... 1 2 3 4 5, 6 Senior-only households $246 430 566 196 306 All households $172 302 398 101 57.7 Low-income households $252 439 578 182 230 Senior-only households 0.6 0.5 0.4 1.4 3.2 All households 1.0 0.8 0.8 2.4 5.5 0.7 0.6 0.6 1.7 4.00 * The savings represent the average LCC for affected consumers. TABLE V.17—COMPARISON OF PERCENT OF IMPACTED CONSUMERS * FOR CONSUMER SUBGROUPS AND ALL HOUSEHOLDS: ELECTRIC STANDARD CONSUMER CLOTHES DRYERS lotter on DSK11XQN23PROD with PROPOSALS2 EL 1 3 4 5 7 Low-income households (%) TSL ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... 1 2 3 4 5, 6 0.27 0.17 0.15 43.7 42.7 * Percent of impacted consumers indicates households with net cost. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00051 Fmt 4701 Sfmt 4702 E:\FR\FM\23AUP2.SGM 23AUP2 Senior-only households (%) 0.45 0.25 0.22 60.0 65.2 All households (%) 0.32 0.16 0.11 53.5 53.1 51784 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules TABLE V.18—COMPARISON OF LCC SAVINGS AND PBP FOR CONSUMER SUBGROUPS AND ALL HOUSEHOLDS: ELECTRIC COMPACT (120V) CONSUMER CLOTHES DRYERS Average life-cycle cost savings * (2020$) EL Low-income households 1 3 4 5 6 Simple payback period (years) TSL .................................................................... .................................................................... .................................................................... .................................................................... .................................................................... 1 2 3, 4 5 6 Senior-only households $139 232 195 151 77.4 All households $86.8 147 119 41.9 (123) Low-income households $115 194 160 86.3 (62.6) Senior-only households 1.1 1.0 1.2 3.6 7.6 All households 2.1 1.9 2.3 6.6 13.8 1. 7 1.5 1.8 5.3 11.0 * The savings represent the average LCC for affected consumers. Negative values denoted in parentheses. TABLE V.19—COMPARISON OF PERCENT OF IMPACTED CONSUMERS * FOR CONSUMER SUBGROUPS AND ALL HOUSEHOLDS: ELECTRIC COMPACT (120V) CONSUMER CLOTHES DRYERS EL 1 3 4 5 6 Low-income households (%) TSL ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... 1 2 3, 4 5 6 Senior-only households (%) 2.43 1.92 14.3 35.5 53.0 All households (%) 7.56 6.15 24.6 59.4 81.5 5.66 4.46 21.6 53.0 76.3 * Percent of impacted consumers indicates households with net cost. TABLE V.20—COMPARISON OF LCC SAVINGS AND PBP FOR CONSUMER SUBGROUPS AND ALL HOUSEHOLDS: VENTED ELECTRIC COMPACT (240V) CONSUMER CLOTHES DRYERS Average life-cycle cost savings * (2020$) EL TSL Low-income households 1 3 4 5 6 Simple payback period (years) .................................................................... .................................................................... .................................................................... .................................................................... .................................................................... 1 2 3, 4 5 6 Senior-only households $116 241 232 193 41.2 All households $70.0 153 145 70.8 (148) Low-income households $94.1 201 192 123 (94.8) Senior-only households 1.4 1.0 1.1 3.2 8.3 All households 2.6 1.9 2.0 5.9 15.3 2.0 1.5 1.6 4.7 12.1 * The savings represent the average LCC for affected consumers. Negative values denoted in parentheses. TABLE V.21—COMPARISON OF PERCENT OF IMPACTED CONSUMERS * FOR CONSUMER SUBGROUPS AND ALL HOUSEHOLDS: VENTED ELECTRIC COMPACT (240V) CONSUMER CLOTHES DRYERS EL 1 3 4 5 6 Low-income households (%) TSL ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... 1 2 3, 4 5 6 Senior-only households (%) 3.71 1.89 3.79 29.0 57.0 All households (%) 11.2 5.96 11.7 53.2 84.5 8.63 4.35 8.37 47.0 79.6 * Percent of impacted consumers indicates households with net cost. TABLE V.22—COMPARISON OF LCC SAVINGS AND PBP FOR CONSUMER SUBGROUPS AND ALL HOUSEHOLDS: VENTED GAS STANDARD CONSUMER CLOTHES DRYERS lotter on DSK11XQN23PROD with PROPOSALS2 Average life-cycle cost savings * (2020$) EL TSL Low-income households 1 2 3 4 Simple payback period (years) .................................................................... .................................................................... .................................................................... .................................................................... 1 2 3, 4, 5 6 $85.1 $182 209 66.5 Senior-only households All households $52.5 122 137 6.97 Low-income households $77.7 174 198 43.0 2.2 1.3 1.5 4.4 * The savings represent the average LCC for affected consumers. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00052 Fmt 4701 Sfmt 4702 E:\FR\FM\23AUP2.SGM 23AUP2 Senior-only households 3.6 2.1 2.6 7.3 All households 2.8 1.6 1.9 5.5 51785 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules TABLE V.23—COMPARISON OF PERCENT OF IMPACTED CONSUMERS * FOR CONSUMER SUBGROUPS AND ALL HOUSEHOLDS: VENTED GAS STANDARD CONSUMER CLOTHES DRYERS EL 1 2 3 4 TSL ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... Low-income households (%) 1 2 3, 4, 5 6 Senior-only households (%) 3.97 0.94 2.16 52.2 All households (%) 9.45 2.70 5.71 67.7 6.04 1.66 3.74 59.3 * Percent of impacted consumers indicates households with net cost. TABLE V.24—COMPARISON OF LCC SAVINGS AND PBP FOR CONSUMER SUBGROUPS AND ALL HOUSEHOLDS: VENTLESS ELECTRIC STANDARD (240V) CONSUMER CLOTHES DRYERS Average life-cycle cost savings * (2020$) EL Simple payback period (years) TSL 0 .................................................................... 1 .................................................................... 2 .................................................................... 1 2, 3, 4, 5 6 Low-income households Senior-only households All households Low-income households Senior-only households All households ........................ $174 136 ........................ $116 (53.1) ........................ $145 11.0 ........................ 0.2 4.9 ........................ 0.4 8.9 ........................ 0.3 7.1 * The savings represent the average LCC for affected consumers. Negative values denoted in parentheses. TABLE V.25—COMPARISON OF PERCENT OF IMPACTED CONSUMERS * FOR CONSUMER SUBGROUPS AND ALL HOUSEHOLDS: VENTLESS ELECTRIC STANDARD (240V) CONSUMER CLOTHES DRYERS EL TSL 0 ....................................................................................................................... 1 ....................................................................................................................... 2 ....................................................................................................................... 1 2, 3, 4, 5 6 Low-income households (%) Senior-only households (%) All households (%) ........................ 0.0 43.3 ........................ 0.01 72.5 ........................ 0.0 66.4 * Percent of impacted consumers indicates households with net cost. TABLE V.26—COMPARISON OF LCC SAVINGS AND PBP FOR CONSUMER SUBGROUPS AND ALL HOUSEHOLDS: VENTLESS ELECTRIC COMBINATION WASHER-DRYER CONSUMER CLOTHES DRYERS Average life-cycle cost savings * (2020$) EL Simple payback period (years) TSL 0 .................................................................... 1 .................................................................... 2 .................................................................... 1 2, 3, 4, 5 6 Low-income households Senior-only households All households Low-income households Senior-only households All households ........................ $17.2 (174) ........................ $12.0 (435) ........................ $15.1 (387) ........................ 0.0 18.8 ........................ 0.0 34.9 ........................ 0.0 27.5 * The savings represent the average LCC for affected consumers. Negative values denoted in parentheses. TABLE V.27—COMPARISON OF PERCENT OF IMPACTED CONSUMERS * FOR CONSUMER SUBGROUPS AND ALL HOUSEHOLDS: VENTLESS ELECTRIC COMBINATION WASHER-DRYER CONSUMER CLOTHES DRYERS EL TSL 0 ....................................................................................................................... 1 ....................................................................................................................... 2 ....................................................................................................................... 1 2, 3, 4, 5 6 Low-income households (%) Senior-only households (%) All households (%) ........................ 0.0 71.5 ........................ 0.0 92.8 ........................ 0.0 89.8 lotter on DSK11XQN23PROD with PROPOSALS2 * Percent of impacted consumers indicates households with net cost. c. Rebuttable Presumption Payback As discussed in section II.A of this document, EPCA establishes a rebuttable presumption that an energy conservation standard is economically justified if the increased purchase cost for a product that meets the standard is VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 less than three times the value of the first-year energy savings resulting from the standard. (42 U.S.C. 6295(o)(2)(B)(iii)) In calculating a rebuttable presumption payback period for each of the considered TSLs, DOE used discrete values, and, as required by PO 00000 Frm 00053 Fmt 4701 Sfmt 4702 EPCA, based the energy use calculation on the DOE test procedure for consumer clothes dryers. In contrast, the PBPs presented in section V.B.1.a of this document were calculated using distributions that reflect the range of energy use in the field. E:\FR\FM\23AUP2.SGM 23AUP2 51786 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules Table V.28 presents the rebuttablepresumption payback periods for the considered TSLs for consumer clothes dryers. The results show that the estimated rebuttable payback period ranges broadly between the product classes. While DOE examined the rebuttable-presumption criterion, it considered whether the standard levels considered for the NOPR are economically justified through a more detailed analysis of the economic impacts of those levels, pursuant to 42 U.S.C. 6295(o)(2)(B)(i), that considers the full range of impacts to the consumer, manufacturer, Nation, and environment. The results of that analysis serve as the basis for DOE to definitively evaluate the economic justification for a potential standard level, thereby supporting or rebutting the results of any preliminary determination of economic justification. TABLE V.28—REBUTTABLE-PRESUMPTION PAYBACK PERIODS Trial standard level Product class 1 2 3 4 5 6 (Years) Electric Standard ...................................... Electric Compact (120 V) ......................... Vented Electric Compact (240 V) ............ Vented Gas Standard .............................. Vented Gas Compact .............................. Ventless Electric Compact (240 V) .......... Ventless Electric Combination WasherDryer ..................................................... 0.67 1.78 2.18 4.28 8.48 ........................ 0.56 1.59 1.57 2.80 6.15 0.35 0.52 1.93 1.72 3.26 8.48 0.35 1.62 1.93 1.72 3.26 ........................ 0.35 3.75 5.64 4.93 3.26 7.35 0.35 3.75 11.7 12.7 8.29 20.5 7.52 ........................ 0.00 0.00 0.00 0.00 28.3 2. Economic Impacts on Manufacturers DOE performed an MIA to estimate the impact of amended energy conservation standards on manufacturers of consumer clothes dryers. The following section describes the expected impacts on manufacturers at each considered TSL. Chapter 12 of the NOPR TSD explains the analysis in further detail. a. Industry Cash Flow Analysis Results In this section, DOE provides GRIM results from the analysis, which examines changes in the industry that would result from a standard. Table V.29 illustrates the estimated financial impacts (represented by changes in INPV) of potential amended energy conservation standards on manufacturers of consumer clothes dryers, as well as the conversion costs that DOE estimates manufacturers of consumer clothes dryers would incur at each TSL. The impact of potential amended energy conservation standards were analyzed under two scenarios: (1) the preservation of gross margin percentage; and (2) the preservation of operating profit, as discussed in section IV.J.2.d of this document. In the preservation of gross margin percentage scenario, DOE applied a gross margin percentage of 21 percent for all product classes and all efficiency levels in the standards case. This scenario assumes that a manufacturer’s per-unit dollar profit would increase as MPCs increase in the standards cases. DOE understand this scenario to be an upper bound to industry profitability under an energy conservation standard. In the preservation of operating profit scenario manufacturers do not earn additional operating profit when compared to the no-standards case scenario. While manufacturers make the necessary upfront investments required to produce compliant products, per-unit operating profit does not change in absolute dollars. The preservation of operating profit scenario results in the lower (or more severe) bound to impacts of potential amended standards on industry. Each of the modeled scenarios results in a unique set of cash flows and corresponding INPV for each TSL. INPV is the sum of the discounted cash flows to the industry from the base year through the end of the analysis period (2022–2056). The ‘‘change in INPV’’ results refer to the difference in industry value between the no-new-standards case and standards case at each TSL. To provide perspective on the short-run cash flow impact, DOE includes a comparison of free cash flow between the no-new-standards case and the standards case at each TSL in the year before amended standards would take effect. This figure provides an understanding of the magnitude of the required conversion costs relative to the cash flow generated by the industry in the no-new-standards case. Conversion costs are one-time investments for manufacturers to bring their manufacturing facilities and product designs into compliance with potential amended standards. As described in section IV.J.2.c of this document, conversion cost investments occur between the year of publication of the final rule and the year by which manufacturers must comply with the new standard. The conversion costs can have a significant impact on the shortterm cash flow on the industry and generally result in lower free cash flow in the period between the publication of the final rule and the compliance date of potential amended standards. Conversion costs are independent of the manufacturer markup scenarios and are not presented as a range in this analysis. lotter on DSK11XQN23PROD with PROPOSALS2 TABLE V.29—MANUFACTURER IMPACT ANALYSIS RESULTS FOR CONSUMER CLOTHES DRYERS Units INPV .................................. Change in INPV * .............. Free Cash Flow (2026) * ... VerDate Sep<11>2014 2020$ millions. % ................. No-newstandards case TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 ........................ 1,785.0 to 1,798.5. (1.4) to (0.6) .... 1,766.8 to 1,789.8. (2.4) to (1.1) .... 1,694.5 to 1,728.5. (6.4) to (4.5) .... 1,368.8 to 1,582.5. (24.4) to (12.6) 120.5 107.2 ............... 98.8 ................. 57.7 ................. (124.1) ............. 830.1 to 1,675.5. (54.1) to (7.4). (392.3) ......... 1,810.1 2020$ millions. 19:56 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00054 Fmt 4701 Sfmt 4702 E:\FR\FM\23AUP2.SGM 23AUP2 TSL 6 732.4 to 1,632.0. (59.5) to (9.8). (443.3). 51787 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules TABLE V.29—MANUFACTURER IMPACT ANALYSIS RESULTS FOR CONSUMER CLOTHES DRYERS—Continued Change in Free Cash Flow (2026) *. Conversion Costs ............. Units No-newstandards case TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 % ................. ........................ (11.0) ............... (18.0) ............... (52.1) ............... (203.0) ............. (425.7) ......... (468.0). 2020$ millions. ........................ 34.1 ................. 55.3 ................. 149.7 ............... 561.7 ............... 1,164.2 ........ 1,280.0. TSL 6 lotter on DSK11XQN23PROD with PROPOSALS2 * Parentheses denote negative values. The cash flow results discussion below refers to product classes as defined in Table IV.2 in section IV.A.1 of this proposed rule. It also refers to the efficiency levels (‘‘ELs’’) and associated design options designated in the Table IV.16 through Table IV.21 in section IV.C.1.b of this document. At TSL 1, the standard reflects efficiency levels with electronic controls for all product classes. The change in INPV is expected to range from ¥1.4 to ¥0.6 percent. At this level, free cash flow is estimated to decrease by 11.0 percent compared to the no-newstandards case value of $120.5 million in the year 2026, the year before the standards year. DOE’s shipments analysis estimates approximately 61 percent of current shipments meet this level. The design options DOE analyzed for Product Classes 1 through 5 include implementing electronic controls. For Product Classes 1 through 5, TSL 1 corresponds to EL 1. For Product Classes 6 and 7, TSL 1 corresponds to the baseline CEFD2. Capital conversion costs may be necessary for additional tooling for timers and electronics. Product conversion costs may be necessary for developing, sourcing, and testing electronics (e.g., safety, performance, and durability tests). DOE does not expect industry to incur reflooring costs at this level since the necessary enhancements could be done ‘‘behind the hinge,’’ incorporating the design changes in a manner that does not impact product appearance. DOE does not expect industry to incur conversion costs related to Product Classes 6 and 7, as the efficiency levels would remain at baseline. DOE estimates capital conversion costs of $15.7 million and product conversion of costs of $18.4 million. Conversion costs total $34.1 million. At TSL 1, the shipment-weighted average MPC for all consumer clothes dryers is expected to increase by 1 percent relative to the no-new-standards case shipment-weighted average MPC for all consumer clothes dryers in 2027. Given this relatively small increase in production costs, DOE does not project a notable drop in shipments in the year VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 the standard takes effect. In the preservation of gross margin percentage scenario, the slight increase in MSP is outweighed by the $34.1 million in conversion costs, causing a slightly negative change in INPV at TSL 1 under this scenario. Under the preservation of operating profit scenario, manufacturers earn the same per-unit operating profit as would be earned in the no-newstandards case, but manufacturers do not earn additional profit from their investments. In this scenario, the manufacturer markup decreases in 2028, the year after the analyzed compliance year. This reduction in the manufacturer markup and the $34.1 million in conversion costs incurred by manufacturers cause a slightly negative change in INPV at TSL 1 under the preservation of operating profit scenario. At TSL 2, the standard reflects efficiency levels with more advanced automatic termination controls for Product Classes 1 through 6, and highspeed spin for product class 7. The change in INPV is expected to range from ¥2.4 to ¥1.1 percent. At this level, free cash flow is estimated to decrease 18.0 percent compared to the no-new-standards case value of $120.5 million in the year 2026, the year before the standards year. DOE’s shipments analysis estimates approximately 60 percent of current shipments meet this level. The design options for Product Classes 1 through 6 include implementing electronic controls, optimized heating systems, and more advanced automatic termination controls. For Product Class 7, the design option analyzed includes high-speed spin cycles. For Product Classes 1 through 3, TSL 2 corresponds to EL 3. For Product Classes 4 and 5, TSL 2 corresponds to EL 2. For Product Classes 6 and 7, TSL 2 corresponds to EL 1. Capital conversion costs may be necessary for incremental updates in tooling. Product conversion costs may be necessary for software optimization, prototyping, and testing. DOE expects industry to incur some re-flooring costs as manufacturers redesign product lines to meet the efficiency levels required by PO 00000 Frm 00055 Fmt 4701 Sfmt 4702 TSL 2. DOE estimates capital conversion costs of $26.9 million and product conversion of costs of $28.4 million. Conversion costs total $55.3 million. At TSL 2, the shipment-weighted average MPC for all consumer clothes dryers is expected to increase by 2 percent relative to the no-new-standards case shipment-weighted average MPC for all consumer clothes dryers in 2027. Given the relatively small increase in production costs, DOE does not project a notable drop in shipments in the year the standard takes effect. In the preservation of gross margin percentage scenario, the slight increase in MSP is outweighed by the $55.3 million in conversion costs, causing a slightly negative change in INPV at TSL 2 under this scenario. Under the preservation of operating profit scenario, the manufacturer markup decreases in 2028, the year after the analyzed compliance year. This reduction in the manufacturer markup and the $55.3 million in conversion costs incurred by manufacturers cause a negative change in INPV at TSL 2 under the preservation of operating profit scenario. At TSL 3, the standard reflects a set of efficiency levels between the levels designated in TSL 2 and TSL 4 and corresponds to the current ENERGY STAR efficiency level for vented electric standard dryers, which represent over 80 percent of the market. The change in INPV is expected to range from ¥6.4 to ¥4.5 percent. At this level, free cash flow is estimated to decrease 52.1 percent compared to the no-newstandards case value of $120.5 million in the year 2026, the year before the standards year. DOE’s shipments analysis estimates approximately 59 percent of current shipments meet this level. The design options analyzed for Product Classes 1 through 4 include implementing electronic controls, optimized heating systems, more advanced automatic termination controls, and modulating heat. The design option for Product Class 5 includes implementing electronic controls. For Product Classes 6 and 7, the design options analyzed are the same as with TSL 2. For Product Classes E:\FR\FM\23AUP2.SGM 23AUP2 lotter on DSK11XQN23PROD with PROPOSALS2 51788 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules 1 through 3, TSL 3 corresponds to EL 4. For Product Class 4, TSL 3 corresponds to EL 3. For Product Classes 5 through 7, TSL 3 corresponds to EL 1. The incremental increase in industry conversion costs from the prior TSL are due to the higher efficiency level requirements for Product Classes 1 through 4. Capital conversion costs may be necessary as manufacturers increase tooling for two-stage heating systems. Product conversion costs may be necessary for prototyping and testing. DOE expects industry to incur similar re-flooring costs as with TSL 2. DOE estimates capital conversion costs of $108.8 million and product conversion of costs of $40.9 million. Conversion costs total $149.7 million. At TSL 3, the shipment-weighted average MPC for all consumer clothes dryers is expected to increase by 3 percent relative to the no-new-standards case shipment-weighted average MPC for all consumer clothes dryers in 2027. Given the relatively small increase in production costs, DOE does not project a notable drop in shipments in the year the standard takes effect. In the preservation of gross margin percentage scenario, the increase in MSP is outweighed by the $149.7 million in conversion costs, causing a negative change in INPV at TSL 3 under this scenario. Under the preservation of operating profit scenario, the manufacturer markup decreases in 2028, the year after the analyzed compliance year. This reduction in the manufacturer markup and the $149.7 million in conversion costs incurred by manufacturers cause a negative change in INPV at TSL 3 under the preservation of operating profit scenario. At TSL 4, the standard reflects the maximum national energy savings with simple PBP of less than 4 years. The change in INPV is expected to range from ¥24.4 to ¥12.6 percent. At this level, free cash flow is estimated to decrease by 203.0 percent compared to the no-new-standards case value of $120.5 million in the year 2026, the year before the standards year. DOE’s shipments analysis estimates approximately 11 percent of current shipments meet this level. The design options analyzed for Product Class 1 include implementing electronic controls, optimized heating systems, more advanced automatic termination controls, modulating heat, and inlet air preheat. For Product Classes 2 through 7, the efficiency levels required for TSL 4 are the same as the efficiency levels required by TSL 3, except for Product Class 5, which corresponds to the baseline CEFD2. The incremental increase in industry VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 conversion costs from the prior TSL are due to the efficiency level requirements for Product Class 1. There is very little industry experience with inlet air preheat designs. Currently, DOE is not aware of any consumer clothes dryers on the market utilizing this design option. Electric standard dryers (Product Class 1) account for an estimated 81 percent of domestic consumer clothes dryer shipments. Of these standard electric dryer shipments, DOE estimates only 4 percent meet or exceed the efficiency level required by TSL 4. Implementing inlet air preheat represents a major overhaul of existing product lines and manufacturing facilities. For capital conversion costs, this change might necessitate significant new equipment and tooling. Product conversion costs may be necessary for designing, prototyping, and testing new or updated platforms. DOE expects industry to incur more re-flooring costs compared to prior TSLs as more display units would need to be replaced with high-efficiency models. DOE estimates capital conversion costs of $489.2 million and product conversion of costs of $72.5 million. Conversion costs total $561.7 million. At TSL 4, the large conversion costs result in a free cash flow dropping below zero in the years before the standards year. The negative free cash flow calculation indicates manufacturers may need to access cash reserves or outside capital to finance conversion efforts. At this level, the shipment-weighted average MPC for all consumer clothes dryers is expected to increase by 17 percent relative to the no-new-standards case shipment-weighted average MPC for all consumer clothes dryers in 2027. Given the projected increase in production costs, DOE expects an estimated 1 percent drop in shipments in the year the standard takes effect. In the preservation of gross margin percentage scenario, the increase in MSP is outweighed by the $561.7 million in conversion costs, causing a negative change in INPV at TSL 4 under this scenario. Under the preservation of operating profit scenario, the manufacturer markup decreases in 2028, the year after the analyzed compliance year. This reduction in the manufacturer markup and the $561.7 million in conversion costs incurred by manufacturers cause a negative change in INPV at TSL 4 under the preservation of operating profit scenario. At TSL 5, the standard reflects the maximum national energy savings with positive NPV. The change in INPV is expected to range from –54.1 to –7.4 percent. At this level, free cash flow is PO 00000 Frm 00056 Fmt 4701 Sfmt 4702 estimated to decrease by 425.7 percent compared to the no-new-standards case value of $120.5 million in the year 2026, the year before the standards year. DOE’s shipments analysis estimates approximately 9 percent of current shipments meet this level. The design option analyzed for Product Class 1 includes implementing heat pump technology. The design options analyzed for Product Classes 2 and 3 include implementing electronic controls, optimized heating systems, more advanced automatic termination controls, modulating heat, and inlet air preheat. For Product Classes 4, 6, and 7, the design options analyzed are the same as prior TSL. At TSL 5, the design option for Product Class 5 includes implementing electronic controls, optimized heating systems, more advanced automatic termination controls, and modulating heat. For Product Class 1, TSL 5 corresponds to EL 7. For Product Class 2 and 3, TSL 5 corresponds to EL 5. For Product Class 4 and 5, TSL 5 corresponds to EL 3. For Product Class 6 and 7, TSL 5 corresponds to EL 1. At TSL 5, conversion costs are largely driven by the max-tech efficiency level required for Product Class 1. As previously discussed, electric standard dryers account for 81 percent of domestic consumer clothes dryer shipments. Currently, there are few electric standard models on the U.S. market that meet the max-tech efficiency level required by TSL 5. Of the 15 OEMs identified, seven OEMs do not offer any U.S. dryers utilizing heat pump technology. Of the eight OEMs with heat pump dryers, only three have electric standard dryers that meet maxtech efficiencies. Most manufacturers would need to significantly update facilities to meet a heat pump efficiency level for Product Class 1. Mandating a heat pump efficiency level for Product Class 1 would require many manufacturers to design completely new clothes dryer platforms or adapt heat pump designs from other markets (i.e., redesign European heat pump models to adhere to U.S. safety standards and consumer preferences). DOE expects industry to incur more re-flooring costs compared to prior TSLs as nearly all display units would need to be replaced with high-efficiency models. DOE estimates capital conversion costs of $1,066.0 million and product conversion of costs of $98.2 million. Conversion costs total $1,164.2 million. As with TSL 4, the large conversion costs result in a free cash flow dropping below zero in the years before the standard year. The negative free cash flow calculation indicates E:\FR\FM\23AUP2.SGM 23AUP2 lotter on DSK11XQN23PROD with PROPOSALS2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules manufacturers may need to access cash reserves or outside capital to finance conversion efforts. At this level, the shipment-weighted average MPC for all consumer clothes dryers is expected to increase by 64 percent relative to the no-new-standards case shipment-weighted average MPC for all consumer clothes dryers in 2027. Given the projected increase in production costs, DOE expects an estimated 12 percent drop in shipments in the year the standard takes effect. In the preservation of gross margin percentage scenario, the increase in MSP is outweighed by the $1,164.2 million in conversion costs and the drop in annual shipments, causing a negative change in INPV at TSL 5 under this scenario. Under the preservation of operating profit scenario, the manufacturer markup decreases in 2028, the year after the analyzed compliance year. This large reduction in manufacturer markup, the $1,164.2 million in conversion costs incurred by manufacturers, and the drop in annual shipments cause a significantly negative change in INPV at TSL 5 under the preservation of operating profit scenario. At TSL 6, the standard reflects maxtech efficiency for all product classes. The change in INPV is expected to range from –59.5 to –9.8 percent. At this level, free cash flow is estimated to decrease by 468.0 percent compared to the nonew-standards case value of $120.5 million in the year 2026, the year before the standards year. DOE’s shipments analysis estimates approximately 1 percent of current shipments meet this level. The design option analyzed for TSL 6 incorporates heat pump technology for Product Classes 1, 2, 3, 6, and 7. For Product Classes 4 and 5, the design options analyzed include implementing electronic controls, optimized heating systems, more advanced automatic termination controls, modulating heat, and inlet air preheat. Seven out of 15 manufacturers identified do not offer any models for the domestic market that utilize heat pump technology. Of the eight OEMs that offer domestic heat pump models, only four of them offer an electric dryer at or above the efficiencies required by TSL 6. A standard that could only be met using heat pump technology could require a total renovation of existing facilities and completely new clothes dryer platforms for manufacturers that do not offer heat pump clothes dryers today. In interviews, two OEMs with significant market shares stated that they would require additional facilities to handle dryer manufacturing under a standard VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 that could only be met using heat pump technology. As previously discussed, implementing inlet air preheat also represents a major overhaul of existing vented gas product lines. DOE expects industry to incur slightly more reflooring costs compared to TSL 5 as all display models below max-tech efficiency would need to be replaced due to the higher standard. At TSL 6, reaching max-tech efficiency levels is a billion-dollar investment for industry. DOE estimates capital conversion costs of $1,172.0 million and product conversion of costs of $108.0 million. Conversion costs total $1,280.0 million. As with TSLs 4 and 5, the large conversion costs result in a free cash flow dropping below zero in the years before the standard year. The negative free cash flow calculation indicates manufacturers may need to access cash reserves or outside capital to finance conversion efforts. At this level, the shipment-weighted average MPC for all consumer clothes dryers is expected to increase by 69 percent relative to the no-new-standards case shipment-weighted average MPC for all consumer clothes dryers in 2027. Given the projected increase in production costs, DOE expects an estimated 13 percent drop in shipments in the year the standard takes effect. In the preservation of gross margin percentage scenario, the large increase in MSP is still outweighed by the $1,280.0 million in conversion costs and drop in annual shipments, causing a moderately negative change in INPV at TSL 6 under this scenario. Under the preservation of operating profit scenario, the manufacturer markup decreases in 2028, the year after the analyzed compliance year. This large reduction in manufacturer markup, the $1,280.0 million in conversion costs incurred by manufacturers, and the drop in annual shipments cause a significantly negative change in INPV at TSL 6 under the preservation of operating profit scenario. b. Direct Impacts on Employment To quantitatively assess the potential impacts of amended energy conservation standards on direct employment in the consumer clothes dryer industry, DOE used the GRIM to estimate the domestic labor expenditures and number of direct employees in the no-new-standards case and in each of the standards cases during the analysis period. DOE calculated these values using statistical data from the U.S. Census Bureau’s 2020 Annual Survey of Manufactures PO 00000 Frm 00057 Fmt 4701 Sfmt 4702 51789 (‘‘ASM’’),81 the U.S. Bureau of Labor Statistics’ employee compensation data,82 results of the engineering analysis, and manufacturer interviews. Labor expenditures related to product manufacturing depend on the labor intensity of the product, the sales volume, and an assumption that wages remain fixed in real terms over time. The total labor expenditures in each year are calculated by multiplying the total MPCs by the labor percentage of MPCs. The total labor expenditures in the GRIM were then converted to total production employment levels by dividing production labor expenditures by the average fully burdened wage multiplied by the average number of hours worked per year per production worker. To do this, DOE relied on the ASM inputs: Production Workers Annual Wages, Production Workers Annual Hours, Production Workers for Pay Period, and Number of Employees. DOE also relied on the BLS employee compensation data to determine the fully burdened wage ratio. The fully burdened wage ratio factors in paid leave, supplemental pay, insurance, retirement and savings, and legally required benefits. The number of production employees is then multiplied by the U.S. labor percentage to convert total production employment to total domestic production employment. The U.S. labor percentage represents the industry fraction of domestic manufacturing production capacity for the covered product. This value is derived from manufacturer interviews, product database analysis, and publicly available information. DOE estimates that 58 percent of consumer clothes dryers are produced domestically. The domestic production employees estimate covers production line workers, including line supervisors, who are directly involved in fabricating and assembling products within the OEM facility. Workers performing services that are closely associated with production operations, such as materials handling tasks using forklifts, are also included as production labor. DOE’s estimates only account for production workers who manufacture the specific equipment covered by this proposed rulemaking. 81 U.S. Census Bureau, Annual Survey of Manufacturers: Summary Statistics for Industry Groups and Industries in the U.S.: 2018–2020. Available at www.census.gov/data/tables/timeseries/econ/asm/2018-2020-asm.html (Last Accessed December 10, 2021). 82 U.S. Bureau of Labor Statistics. Employer Costs for Employee Compensation. June 17, 2021. Available at: www.bls.gov/news.release/pdf/ ecec.pdf. E:\FR\FM\23AUP2.SGM 23AUP2 51790 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules Non-production workers account for the remainder of the direct employment figure. The non-production employees estimate covers domestic workers who are not directly involved in the production process, such as sales, engineering, human resources, and management. Using the amount of domestic production workers calculated above, non-production domestic domestic workers for consumer clothes dryers in 2027. Table V.30 shows the range of the impacts of energy conservation standards on U.S. manufacturing employment in the consumer clothes dryer industry. The following discussion provides a qualitative evaluation of the range of potential impacts presented in Table V.30. employees are extrapolated by multiplying the ratio of non-production workers in the industry compared to production employees. DOE assumes that this employee distribution ratio remains constant between the nostandards case and standards cases. Using the GRIM, DOE estimates in the absence of new energy conservation standards there would be 2,460 TABLE V.30—DOMESTIC DIRECT EMPLOYMENT IMPACTS FOR CONSUMER CLOTHES DRYER MANUFACTURERS IN 2027 No-newstandards case Direct Employment in 2027 (Production Workers + Non-Production Workers). Potential Changes in Direct Employment Workers in 2027 *. 2,460 TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 TSL 6 2,468 ................ 2,489 ................ 2,495 ................ 2,809 ................ 5,101 ................ 5,209. (2,166) to 8 ...... (2,166) to 29 .... (2,166) to 35 .... (2,166) to 349 .. (2,166) to 2,641 (2,166) to 2,749. * DOE presents a range of potential employment impacts. Numbers in parentheses indicate negative numbers. lotter on DSK11XQN23PROD with PROPOSALS2 The direct employment impacts shown in Table V.30 represent the potential domestic employment changes that could result following the compliance date for the consumer clothes dryer product classes in this proposal. The upper bound estimate corresponds to an increase in the number of domestic workers that would result from amended energy conservation standards if manufacturers continue to produce the same scope of covered equipment within the United States after compliance takes effect. The lower bound estimate represents the maximum decrease in production workers if manufacturing moved to lower labor-cost countries. Most manufacturers currently produce at least a portion of their consumer clothes dryers in countries with lower labor costs, and an amended standard that necessitates large increases in labor content or large expenditures to re-tool facilities could cause manufacturers to re-evaluate domestic production siting options. Additional detail on the analysis of direct employment can be found in chapter 12 of the NOPR TSD. Additionally, the employment impacts discussed in this section are independent of the employment impacts from the broader U.S. economy, which are documented in chapter 16 of the NOPR TSD. c. Impacts on Manufacturing Capacity As discussed in section V.B.2.a of this document, implementing the different design options analyzed for this NOPR would require varying levels of resources and investment. A standard level that would require the use of heat pump technology for electric dryers and combination washer-dryers would VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 represent the biggest shift in technology for clothes dryer manufacturing among all the design options considered for this analysis. Adopting efficiency levels that require heat pump technology would necessitate very large investments to both redesign products and update production facilities. Currently, DOE estimates that approximately 1 percent of consumer clothes dryer shipments meet heat pump efficiency levels. In interviews, several manufacturers expressed concerns that the 3-year time period between the announcement of the final rule and the compliance date of the amended energy conservation standard might be insufficient to design, test, and manufacture the necessary number of products to meet demand. In interviews, some manufacturers raised concerns about implementing inlet air preheat designs. Unlike the discussions about heat pump technology, there is very little industry experience with inlet air preheat designs. Currently, no models on the U.S. market incorporate this design option. Several manufacturers speculated that implementing inlet air preheat would require a major overhaul of existing production facilities and a significant amount of engineering time. For the remaining dryer design options associated with lower efficiency levels (e.g., implementing electronic controls, optimized heating systems, more advanced automatic termination controls, and modulating heat), manufacturers could likely maintain manufacturing capacity levels and continue to meet market demand under amended energy conservation standards. A significant portion of consumer clothes dryers already incorporate these design options. For PO 00000 Frm 00058 Fmt 4701 Sfmt 4702 instance, approximately 64 percent of standard electric dryer shipments meet or exceed the efficiencies associated with implementing modulating heat (EL 4). However, industry did note concerns about the ongoing supply constraints related to the COVID–19 pandemic, particularly around sourcing microprocessors and electronics. Any shift away from electromechanical controls would require that industry source more electronic components, which are already difficult to secure. If these supply constraints continue through the end of the conversion period, industry could face production capacity constraints. d. Impacts on Subgroups of Manufacturers Using average cost assumptions to develop industry cash-flow estimates may not capture the differential impacts among subgroups of manufacturers. Small manufacturers, niche players, or manufacturers exhibiting a cost structure that differs substantially from the industry average could be affected disproportionately. DOE investigated small businesses as a manufacturer subgroup that could be disproportionally impacted by energy conservation standards and could merit additional analysis. DOE did not identify any other adversely impacted manufacturer subgroups for this rulemaking based on the results of the industry characterization. DOE analyzes the impacts on small businesses in a separate analysis in section VI.B of this document as part of the Regulatory Flexibility Analysis. For a discussion of the impacts on the small business manufacturer subgroup, see the Regulatory Flexibility Analysis in E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules section VI.B of this document and chapter 12 of the NOPR TSD. e. Cumulative Regulatory Burden One aspect of assessing manufacturer burden involves looking at the cumulative impact of multiple DOE standards and the product-specific regulatory actions of other Federal agencies that affect the manufacturers of a covered product or equipment. While any one regulation may not impose a significant burden on manufacturers, the combined effects of several existing 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 51791 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 appliance efficiency. For the cumulative regulatory burden analysis, DOE examines Federal, product-specific regulations that could affect consumer clothes dryer manufacturers that take effect approximately three years before or after the 2027 compliance date. TABLE V.31—COMPLIANCE DATES AND EXPECTED CONVERSION EXPENSES OF FEDERAL ENERGY CONSERVATION STANDARDS AFFECTING CONSUMER CLOTHES DRYER ORIGINAL EQUIPMENT MANUFACTURERS Number of OEMs affected from today’s rule ** Number of OEMs * Federal energy conservation standard Portable Air Conditioners 85 FR 1378 (January 10, 2020) ........................................................................ Room Air Conditioners † 87 FR 20608 (April 7, 2022) Commercial Water Heating Equipment † 87 FR 30610 (May 19, 2022) .............................................. Consumer Furnaces † 87 FR 40590 (July 7, 2022) .... Industry conversion costs (millions $) Approx. standards year Industry conversion costs/product revenue *** (%) 11 8 2 4 2025 2026 $320.9 (2015$) 22.8 (2020$) 6.7 0.5 15 15 1 1 2026 2029 34.6 (2020$) 150.6 (2020$) 4.7 1.4 * This column presents the total number of OEMs identified in the energy conservation standard rule contributing to cumulative regulatory burden. ** This column presents the number of OEMs producing consumer clothes dryers that are also listed as OEMs in the identified energy conservation standard contributing to cumulative regulatory burden. *** This column presents industry conversion costs as a percentage of product revenue during the conversion period. Industry conversion costs are the upfront investments manufacturers must make to sell compliant products/equipment. The revenue used for this calculation is the revenue from just the covered product/equipment associated with each row. The conversion period is the time frame over which conversion costs are made and lasts from the publication year of the final rule to the compliance year of the final rule. The conversion period typically ranges from 3 to 5 years, depending on the energy conservation standard. † The Room Air Conditioners, Consumer Furnaces, and Commercial Water Heating Equipment rulemakings are in the NOPR stage and all values are subject to change until finalized. 3. National Impact Analysis a. Significance of Energy Savings This section presents DOE’s estimates of the national energy savings and the NPV of consumer benefits that would result from each of the TSLs considered as potential amended standards. To estimate the energy savings attributable to potential amended standards for consumer clothes dryers, DOE compared their energy consumption under the no-newstandards case to their anticipated energy consumption under each TSL. The savings are measured over the entire lifetime of products purchased in the 30-year period that begins in the year of anticipated compliance with amended standards (2027–2056). Table V.32 presents DOE’s projections of the national energy savings for each TSL considered for consumer clothes dryers. The savings were calculated using the approach described in section IV.H.2 of this document. TABLE V.32—CUMULATIVE NATIONAL ENERGY SAVINGS FOR CONSUMER CLOTHES DRYERS; 30 YEARS OF SHIPMENTS [2027–2056] Trial standard level 1 2 3 4 5 6 (quads) lotter on DSK11XQN23PROD with PROPOSALS2 Primary energy ......................................... FFC energy .............................................. 0.97 1.01 OMB Circular A–4 83 requires agencies to present analytical results, 19:56 Aug 22, 2022 Jkt 256001 2.97 3.11 including separate schedules of the monetized benefits and costs that show the type and timing of benefits and 83 U.S. Office of Management and Budget. Circular A–4: Regulatory Analysis. September 17, 2003. Available at obamawhitehouse.archives.gov/ VerDate Sep<11>2014 1.98 2.07 omb/circulars_a004_a-4/ (last accessed December 16, 2021). PO 00000 Frm 00059 Fmt 4701 Sfmt 4702 3.90 4.06 9.59 9.97 9.68 10.1 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 E:\FR\FM\23AUP2.SGM 23AUP2 51792 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules using 9 years, rather than 30 years, of product shipments. The choice of a 9year 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.84 The review timeframe established in EPCA is generally not synchronized with the product lifetime, product manufacturing cycles, or other factors specific to consumer clothes dryers. Thus, such results are presented for informational purposes only and are not indicative of any change in DOE’s analytical methodology. The NES sensitivity analysis results based on a 9-year analytical period are presented in Table V.33. The impacts are counted over the lifetime of consumer clothes dryers purchased in 2027–2035. TABLE V.33—CUMULATIVE NATIONAL ENERGY SAVINGS FOR CONSUMER CLOTHES DRYERS; 9 YEARS OF SHIPMENTS [2027–2035] Trial standard level 1 2 3 4 5 6 (quads) Primary energy ......................................... FFC energy .............................................. 0.41 0.43 b. Net Present Value of Consumer Costs and Benefits DOE estimated the cumulative NPV of the total costs and savings for 0.78 0.82 1.09 1.14 consumers that would result from the TSLs considered for consumer clothes dryers. In accordance with OMB’s guidelines on regulatory analysis,85 DOE calculated NPV using both a 7- 1.35 1.41 2.92 3.04 2.95 3.07 percent and a 3-percent real discount rate. Table V.34 shows the consumer NPV results with impacts counted over the lifetime of products purchased in 2027–2056. TABLE V.34—CUMULATIVE NET PRESENT VALUE OF CONSUMER BENEFITS FOR CONSUMER CLOTHES DRYERS; 30 YEARS OF SHIPMENTS [2027–2056] Trial standard level Discount rate 1 2 3 4 5 6 (billion 2020$) 3 percent .................................................. 7 percent .................................................. 6.90 3.10 The NPV results based on the aforementioned 9-year analytical period are presented in Table V.35. The impacts are counted over the lifetime of 14.1 6.28 20.8 9.07 products purchased in 2027–2035. As mentioned previously, such results are presented for informational purposes only and are not indicative of any 18.4 7.13 27.8 7.76 25.7 6.60 change in DOE’s analytical methodology or decision criteria. TABLE V.35—CUMULATIVE NET PRESENT VALUE OF CONSUMER BENEFITS FOR CONSUMER CLOTHES DRYERS; 9 YEARS OF SHIPMENTS [2027–2035] Trial standard level Discount rate 1 2 3 4 5 6 (billion 2020$) lotter on DSK11XQN23PROD with PROPOSALS2 3 percent .................................................. 7 percent .................................................. 3.61 1.96 7.02 3.84 9.78 5.34 8.90 4.38 12.8 4.91 11.9 4.27 The previous results in Table V.34 reflect the use of a default trend to estimate the change in price for consumer clothes dryers over the analysis period (see section IV.F.1 of this document). DOE also conducted a sensitivity analysis that considered one scenario with a lower rate of price decline than the reference case and one 84 Section 325(m) of EPCA requires DOE to review its standards at least once every 6 years, and requires, for certain products, a 3-year period after any new standard is promulgated before compliance is required, except that in no case may any new standards be required within 6 years of the compliance date of the previous standards. While adding a 6-year review to the 3-year compliance period adds up to 9 years, DOE notes that it may undertake reviews at any time within the 6-year period and that the 3-year compliance date may yield to the 6-year backstop. A 9-year analysis period may not be appropriate given the variability that occurs in the timing of standards reviews and the fact that for some products, the compliance period is 5 years rather than 3 years. 85 U.S. Office of Management and Budget. Circular A–4: Regulatory Analysis. September 17, 2003. Available at obamawhitehouse.archives.gov/ omb/circulars_a004_a-4/ (last accessed December 16, 2021). VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00060 Fmt 4701 Sfmt 4702 E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules scenario with a higher rate of price decline than the reference case. The results of these alternative cases are presented in appendix 10C of the NOPR TSD. In the high-price-decline case, the NPV of consumer benefits is higher than in the default case. In the low-pricedecline case, the NPV of consumer benefits is lower than in the default case. c. Indirect Impacts on Employment It is estimated that that amended energy conservation standards for consumer clothes dryers would reduce energy expenditures for consumers of those products, with the resulting net savings being redirected to other forms of economic activity. These expected shifts in spending and economic activity could affect the demand for labor. As described in section IV.N of this document, DOE used an input/output model of the U.S. economy to estimate indirect employment impacts of the TSLs that DOE considered. There are uncertainties involved in projecting employment impacts, especially changes in the later years of the analysis. Therefore, DOE generated results for near-term timeframes (2027– 2033), where these uncertainties are reduced. The results suggest that the proposed standards would be likely to have a negligible impact on the net demand for labor in the economy. The net change in jobs is so small that it would be imperceptible in national labor statistics and might be offset by other, unanticipated effects on employment. Chapter 16 of the NOPR TSD presents detailed results regarding anticipated indirect employment impacts. 4. Impact on Utility or Performance of Products As discussed in section III.E.1.d of this document, DOE has tentatively concluded that the standards proposed in this NOPR would not lessen the utility or performance of the consumer clothes dryers under consideration in this rulemaking. Manufacturers of these products currently offer units that meet or exceed the proposed standards. 5. Impact of Any Lessening of Competition DOE considered any lessening of competition that would be likely to result from new or amended standards. As discussed in section III.E.1.e of this document, the Attorney General determines the impact, if any, of any lessening of competition likely to result from a proposed standard, and transmits such determination in writing to the Secretary, together with an analysis of the nature and extent of such impact. To assist the Attorney General in making this determination, DOE has provided DOJ with copies of this NOPR and the accompanying TSD for review. DOE will consider DOJ’s comments on the proposed rule in determining whether to proceed to a final rule. DOE will publish and respond to DOJ’s comments in that document. DOE invites comment from the public regarding the competitive impacts that are likely to 51793 result from this proposed rule. In addition, stakeholders may also provide comments separately to DOJ regarding these potential impacts. See the ADDRESSES section for information to send comments to DOJ. 6. Need of the Nation To Conserve Energy Enhanced energy efficiency, where economically justified, improves the Nation’s energy security, strengthens the economy, and reduces the environmental impacts (costs) of energy production. Reduced electricity demand due to energy conservation standards is also likely to reduce the cost of maintaining the reliability of the electricity system, particularly during peak-load periods. Chapter 15 in the NOPR TSD presents the estimated impacts on electricity generating capacity, relative to the no-newstandards case, for the TSLs that DOE considered in this rulemaking. Energy conservation resulting from potential energy conservation standards for consumer clothes dryers is expected to yield environmental benefits in the form of reduced emissions of certain air pollutants and greenhouse gases. Table V.36 provides DOE’s estimate of cumulative emissions reductions expected to result from the TSLs considered in this proposed rulemaking. The emissions were calculated using the multipliers discussed in section IV.K of this document. DOE reports annual emissions reductions for each TSL in chapter 13 of the NOPR TSD. TABLE V.36—CUMULATIVE EMISSIONS REDUCTION FOR CONSUMER CLOTHES DRYERS SHIPPED IN 2027–2056 Trial standard level 1 2 3 4 5 6 Power Sector Emissions CO2 (million metric tons) ......................... SO2 (thousand tons) ................................ NOX (thousand tons) ................................ Hg (tons) .................................................. CH4 (thousand tons) ................................ N2O (thousand tons) ................................ 35.1 13.7 17.2 0.08 2.48 0.34 71.5 27.9 35.1 0.17 5.05 0.70 107 42.1 52.1 0.25 7.58 1.05 138 56.5 65.0 0.34 10.0 1.39 329 145 144 0.88 25.2 3.51 334 145 149 0.88 25.3 3.52 8.60 0.49 129 0.001 875 0.04 10.9 0.66 163 0.001 1,101 0.05 25.0 1.67 372 0.003 2,494 0.12 25.6 1.67 382 0.003 2,567 0.12 116 42.6 181 0.26 149 57.2 228 0.34 354 147 516 0.88 360 147 531 0.88 lotter on DSK11XQN23PROD with PROPOSALS2 Upstream Emissions CO2 (million metric tons) ......................... SO2 (thousand tons) ................................ NOX (thousand tons) ................................ Hg (tons) .................................................. CH4 (thousand tons) ................................ N2O (thousand tons) ................................ 2.82 0.16 42.1 0.000 287 0.01 5.77 0.33 86.3 0.001 587 0.03 Total FFC Emissions CO2 (million metric tons) ......................... SO2 (thousand tons) ................................ NOX (thousand tons) ................................ Hg (tons) .................................................. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 37.9 13.9 59.4 0.08 PO 00000 Frm 00061 77.3 28.3 121 0.17 Fmt 4701 Sfmt 4702 E:\FR\FM\23AUP2.SGM 23AUP2 51794 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules TABLE V.36—CUMULATIVE EMISSIONS REDUCTION FOR CONSUMER CLOTHES DRYERS SHIPPED IN 2027–2056— Continued Trial standard level 1 CH4 (thousand tons) ................................ N2O (thousand tons) ................................ 2 289 0.36 As part of the analysis for this rulemaking, DOE estimated monetary benefits likely to result from the reduced emissions of CO2 that DOE 3 592 0.72 4 5 883 1.09 1,111 1.44 estimated for each of the considered TSLs for consumer clothes dryers. Section IV.L.1.a of this document discusses the SC–CO2 values used. 6 2,519 3.64 2,592 3.64 Table V.37 presents the present value of the CO2 emissions reduction at each TSL. TABLE V.37—POTENTIAL STANDARDS: PRESENT VALUE OF CO2 EMISSIONS REDUCTION FOR CONSUMER CLOTHES DRYERS SHIPPED IN 2027–2056 SC–CO2 case discount rate and statistics TSL 5%, Average 3%, Average 2.5%, Average 3%, 95th percentile (million 2020$) 1 2 3 4 5 6 ......................................................................................... ......................................................................................... ......................................................................................... ......................................................................................... ......................................................................................... ......................................................................................... As discussed in section IV.L.1.b of this document, DOE estimated monetary benefits likely to result from the reduced emissions of methane and N2O 337 677 993 1,263 2,918 2,966 1,459 2,945 4,351 5,558 12,977 13,187 that DOE estimated for each of the considered TSLs for consumer clothes dryers. Table V.38 presents the value of the CH4 emissions reduction at each 2,284 4,617 6,834 8,742 20,475 20,807 4,445 8,963 13,236 16,899 39,423 40,061 TSL, and Table V.39 presents the value of the N2O emissions reduction at each TSL. TABLE V.38—POTENTIAL STANDARDS: PRESENT VALUE OF METHANE EMISSIONS REDUCTION FOR CONSUMER CLOTHES DRYERS SHIPPED IN 2027–2056 SC–CH4 case discount rate and statistics TSL 5%, Average 3%, Average 2.5%, Average 3%, 95th percentile (million 2020$) 1 2 3 4 5 6 ......................................................................................... ......................................................................................... ......................................................................................... ......................................................................................... ......................................................................................... ......................................................................................... 118 237 348 432 955 983 350 711 1,052 1,317 2,949 3,035 489 994 1,474 1,848 4,151 4,272 929 1,886 2,789 3,489 7,805 8,032 TABLE V.39—POTENTIAL STANDARDS: PRESENT VALUE OF NITROUS OXIDE EMISSIONS REDUCTION FOR CONSUMER CLOTHES DRYERS SHIPPED IN 2027–2056 SC–N2O case discount rate and statistics TSL 5%, Average 3%, Average 2.5%, Average 3%, 95th percentile lotter on DSK11XQN23PROD with PROPOSALS2 (million 2020$) 1 2 3 4 5 6 ......................................................................................... ......................................................................................... ......................................................................................... ......................................................................................... ......................................................................................... ......................................................................................... VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00062 1.20 2.40 3.54 4.64 11.4 11.4 Fmt 4701 Sfmt 4702 4.81 9.71 14.4 19.0 47.2 47.3 E:\FR\FM\23AUP2.SGM 7.47 15.1 22.5 29.7 73.8 74.0 23AUP2 12.8 25.9 38.4 50.6 126 126 51795 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules 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 evolve rapidly. Thus, any value placed on reduced GHG emissions in this rulemaking is subject to change. That said, because of omitted damages, DOE agrees with the IWG that these estimates most likely underestimate the climate benefits of greenhouse gas reductions. 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 and other rulemakings, as well as other methodological assumptions and issues. DOE notes that the proposed standards would be economically justified even without inclusion of monetized benefits of reduced GHG emissions. DOE also estimated the monetary value of the economic impacts associated with changes in SO2 emissions anticipated to result from the considered TSLs for consumer clothes dryers. The dollar-per-ton values that DOE used are discussed in section IV.L.2 of this document. Table V.40 presents the present value SO2 emission changes for each TSL calculated using 7-percent and 3-percent discount rates. This table presents results that use the low benefit-per-ton values, which reflect DOE’s primary estimate. TABLE V.40—POTENTIAL STANDARDS: PRESENT VALUE OF SO2 EMISSION REDUCTION FOR CONSUMER CLOTHES DRYERS SHIPPED IN 2027–2056 TSL 3% Discount rate 7% Discount rate (million 2020$) 1 2 3 4 5 6 ............................................................................................................................................................... ............................................................................................................................................................... ............................................................................................................................................................... ............................................................................................................................................................... ............................................................................................................................................................... ............................................................................................................................................................... As part of the analysis for this rulemaking, DOE also estimated the monetary value of the economic benefits associated with NOX emissions reductions anticipated to result from the considered TSLs for consumer clothes dryers. The dollar-per-ton values that DOE used are discussed in section IV.L of this document. Table V.41 presents the present value for NOX emissions reduction for each TSL calculated using 7-percent and 3-percent discount rates. 773 1,552 2,298 3,039 7,592 7,581 318 628 911 1,184 2,850 2,845 The results in this table reflect application of the low dollar-per-ton values, which DOE used to be conservative. Results that reflect high dollar-per-ton values are presented in chapter 14 of the NOPR TSD. TABLE V.41—POTENTIAL STANDARDS: PRESENT VALUE OF NOX EMISSIONS REDUCTION FOR CONSUMER CLOTHES DRYERS SHIPPED IN 2027–2056 TSL 3% Discount rate 7% Discount rate (million 2020$) 1 2 3 4 5 6 ............................................................................................................................................................... ............................................................................................................................................................... ............................................................................................................................................................... ............................................................................................................................................................... ............................................................................................................................................................... ............................................................................................................................................................... 2,317 4,656 6,842 8,640 19,688 20,094 943 1,858 2,678 3,335 7,339 7,490 Note: Results are based on the low benefit-per-ton values. lotter on DSK11XQN23PROD with PROPOSALS2 The benefits of reduced CO2, CH4, and N2O emissions are collectively referred to as climate benefits. The benefits of reduced SO2 and NOX emissions changes are collectively referred to as health benefits. For the time series of estimated monetary values of reduced emissions, see chapter 14 of the NOPR TSD. 7. Other Factors The Secretary of Energy, in determining whether a standard is economically justified, may consider any other factors that the Secretary deems to be relevant. (42 U.S.C. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 6295(o)(2)(B)(i)(VII)) No other factors were considered in this analysis. 8. Summary of Economic Impacts Table V.42 presents the NPV values that result from adding the estimates of the potential monetized estimates of the potential economic, climate, and health benefits resulting from reduced GHG, NOX, and SO2 emissions to the NPV of consumer benefits calculated for each TSL considered in this rulemaking. The consumer benefits are domestic U.S. monetary savings that occur as a result of purchasing the covered consumer clothes dryers and are measured for the PO 00000 Frm 00063 Fmt 4701 Sfmt 4702 lifetime of products shipped in 2027– 2056. The climate benefits associated with reduced GHG emissions resulting from the adopted standards are global benefits and are also calculated based on the lifetime of consumer clothes dryers shipped in 2027–2056. The climate benefits associated with four SC–GHG estimates are shown. DOE does not have a single central SC–GHG point estimate and it emphasizes the importance and value of considering the benefits calculated using all four SC– GHG estimates. E:\FR\FM\23AUP2.SGM 23AUP2 51796 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules TABLE V.42—POTENTIAL STANDARDS: NPV OF CONSUMER BENEFITS COMBINED WITH MONETIZED CLIMATE AND HEALTH BENEFITS FROM EMISSIONS REDUCTIONS Category TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 TSL 6 3% discount rate for NPV of Consumer and Health Benefits (billion 2020$) 5% d.r., Average SC–GHG case ..................................... 3% d.r., Average SC–GHG case ..................................... 2.5% d.r., Average SC–GHG case .................................. 3% d.r., 95th percentile SC–GHG case .......................... 10.4 11.8 12.8 15.4 21.3 24.0 26.0 31.2 31.3 35.4 38.3 46.0 31.8 37.0 40.7 50.5 59.0 71.1 79.8 102 57.3 69.7 78.5 102 21.8 33.9 42.7 65.3 20.9 33.2 42.1 65.2 7% discount rate for NPV of Consumer and Health Benefits (billion 2020$) 5% d.r., Average SC–GHG case ..................................... 3% d.r., Average SC–GHG case ..................................... 2.5% d.r., Average SC–GHG case .................................. 3% d.r., 95th percentile SC–GHG case .......................... lotter on DSK11XQN23PROD with PROPOSALS2 C. Conclusion When considering new or amended energy conservation standards, the standards that DOE adopts for any type (or class) of covered product must be designed to achieve the maximum improvement in energy efficiency that the Secretary determines is technologically feasible and economically justified. (42 U.S.C. 6295(o)(2)(A)) In determining whether a standard is economically justified, the Secretary must determine whether the benefits of the standard exceed its burdens by, to the greatest extent practicable, considering the seven statutory factors discussed previously. (42 U.S.C. 6295(o)(2)(B)(i)) The new or amended standard must also result in significant conservation of energy. (42 U.S.C. 6295(o)(3)(B)) For this NOPR, DOE considered the impacts of amended standards for consumer clothes dryers at each TSL, beginning with the maximum technologically feasible level, to determine whether that level was economically justified. Where 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 refers to this process as the ‘‘walk-down’’ analysis. To aid the reader as DOE discusses the benefits and/or burdens of each TSL, tables in this section present a summary of the results of DOE’s quantitative analysis for each TSL. In addition to the quantitative results presented in the tables, DOE also considers other burdens and benefits that affect economic justification. These include the impacts on identifiable subgroups of consumers who may be VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 4.82 6.18 7.14 9.75 9.68 12.4 14.4 19.6 disproportionately affected by a national standard and impacts on employment. 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. 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, (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 (for example, between renters and owners, or builders and purchasers). Having 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. In DOE’s current regulatory analysis, potential changes in the benefits and costs of a regulation due to changes in consumer purchase decisions are included in two ways. First, if consumers forgo the purchase of a product in the standards case, this decreases sales for product manufacturers, and the impact on manufacturers attributed to lost revenue is included in the MIA. Second, DOE accounts for energy savings attributable only to products actually used by consumers in the standards case; if a standard decreases the number of products purchased by consumers, this decreases the potential energy savings PO 00000 Frm 00064 Fmt 4701 Sfmt 4702 14.0 18.1 21.0 28.7 13.3 18.5 22.3 32.1 from an energy conservation standard. DOE provides estimates of shipments and changes in the volume of product purchases in chapter 9 of the NOPR TSD. However, DOE’s current analysis does not explicitly control for heterogeneity in consumer preferences, preferences across subcategories of products or specific features, or consumer price sensitivity variation according to household income.86 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 energy conservation standard, 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 has posted a paper that discusses the issue of consumer welfare impacts of appliance energy conservation standards, and potential enhancements to the methodology by which these impacts are defined and estimated in the regulatory process.87 DOE welcomes comments on how to more fully assess the potential impact of energy conservation standards on consumer choice and how to quantify this impact in its regulatory analysis in future rulemakings. 1. Benefits and Burdens of TSLs Considered for Consumer Clothes Dryers Standards Table V.43 and Table V.44 summarize the quantitative impacts estimated for each TSL for consumer clothes dryers. 86 P.C. Reiss and M.W. White. Household Electricity Demand, Revisited. Review of Economic Studies. 2005. 72(3): pp. 853–883. doi: 10.1111/ 0034–6527.00354. 87 Sanstad, A.H. Notes on the Economics of Household Energy Consumption and Technology Choice. 2010. Lawrence Berkeley National Laboratory. Available at www1.eere.energy.gov/ buildings/appliance_standards/pdfs/consumer_ee_ theory.pdf (last accessed November 12, 2021). E:\FR\FM\23AUP2.SGM 23AUP2 51797 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules The national impacts are measured over the lifetime of consumer clothes dryers purchased in the 30-year period that begins in the anticipated year of compliance with amended standards (2027–2056). The energy savings, emissions reductions, and value of emissions reductions refer to full-fuelcycle results. The efficiency levels TSLs. Since there are not cross elasticities modeled in this proposed rulemaking for consumer clothes dryers, the cost analysis and associated justification would be the same if DOE evaluated at the individual product class level. contained in each TSL are described in section V.A of this document. In addition, as DOE noted in section V.A of this document, DOE is evaluating proposed energy conservation standards by looking at the maximum improvement that is technologically feasible and cost justified under bundled policy scenarios referred to as TABLE V.43—SUMMARY OF ANALYTICAL RESULTS FOR CONSUMER CLOTHES DRYERS TSLS: NATIONAL IMPACTS Category TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 TSL 6 Cumulative FFC National Energy Savings (quads) Quads ............................................................................... 1.01 2.07 3.11 4.06 9.97 10.1 149 57.2 228 0.34 1,111 1.44 354 147 516 0.88 2,519 3.64 360 147 531 0.88 2,592 3.64 69.5 16.0 27.3 113 41.7 27.8 71.1 69.8 16.3 27.7 114 44.1 25.7 69.7 29.2 16.0 10.2 55.4 21.4 7.76 33.9 29.3 16.3 10.3 55.9 44.1 6.60 33.2 Cumulative FFC Emissions Reduction (Total FFC Emissions) CO2 (million metric tons) ................................................. SO2 (thousand tons) ........................................................ NOX (thousand tons) ....................................................... Hg (tons) .......................................................................... CH4 (thousand tons) ........................................................ N2O (thousand tons) ........................................................ 37.9 13.9 59.4 0.08 289 0.36 77.3 28.3 121 0.17 592 0.72 116 42.6 181 0.26 883 1.09 Present Value of Monetized Benefits and Costs (3% discount rate, billion 2020$) Consumer Operating Cost Savings ................................. Climate Benefits * ............................................................. Health Benefits ** ............................................................. Total Benefits † ................................................................ Consumer Incremental Product Costs ‡ .......................... Consumer Net Benefits .................................................... Total Net Benefits ............................................................ 7.50 1.81 3.09 12.4 0.61 6.90 11.8 15.1 3.67 6.21 24.9 0.92 14.1 24.0 22.2 5.42 9.14 36.8 1.36 20.8 35.4 28.8 6.89 11.7 47.4 10.4 18.4 37.0 Present Value of Monetized Benefits and Costs (7% discount rate, billions 2020$) lotter on DSK11XQN23PROD with PROPOSALS2 Consumer Operating Cost Savings ................................. Climate Benefits * ............................................................. Health Benefits ** ............................................................. Total Benefits † ................................................................ Consumer Incremental Product Costs ‡ .......................... Consumer Net Benefits .................................................... Total Net Benefits ............................................................ 3.45 1.81 1.26 6.53 0.35 3.10 6.18 6.80 3.67 2.49 13.0 0.52 6.28 12.4 9.83 5.42 3.59 18.8 0.76 9.07 18.1 12.6 6.89 4.52 24.0 5.42 7.13 18.5 Note: This table presents the costs and benefits associated with consumer clothes dryers shipped in 2027–2056. These results include benefits to consumers which accrue after 2056 from the products shipped in 2027–2056. * Climate benefits are calculated using four different estimates of the social cost of carbon (SC–CO2), methane (SC–CH4), and nitrous oxide (SC–N2O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates; 95th percentile at 3 percent discount rate). Together these represent the global social cost of greenhouse gases (SC–GHG). For presentational purposes of this table, the climate benefits associated with the average SC–GHG at a 3 percent discount rate are shown, but the Department does not have a single central SC–GHG point estimate. See section. IV.L of this document for more details. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22–30087) granted the Federal government’s emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued in Louisiana v. Biden, No. 21–cv– 1074–JDC–KK (W.D. La.). As a result of the Fifth Circuit’s order, the preliminary injunction is no longer in effect, pending resolution of the Federal government’s appeal of that injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in that case from ‘‘adopting, employing, treating as binding, or relying upon’’ the interim estimates of the social cost of greenhouse gases—which were issued by the Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 2021—to monetize the benefits of reducing greenhouse gas emissions. As reflected in this rule, DOE has reverted to its approach prior to the injunction and presents monetized greenhouse gas abatement benefits where appropriate and permissible under law. ** Health benefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only monetizing (for SO2 and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits, but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM2.5 emissions. The health benefits are presented at real discount rates of 3 and 7 percent. See section IV.L of this document for more details. † Total and net benefits include those consumer, climate, and health benefits that can be monetized. For presentation purposes, total and net benefits for both the 3-percent and 7-percent cases are presented using the average SC–GHG with 3-percent discount rate, but the Department does not have a single central SC–GHG point estimate. DOE emphasizes the importance and value of considering the benefits calculated using all four SC–GHG estimates. ‡ Costs include incremental equipment costs as well as installation costs. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00065 Fmt 4701 Sfmt 4702 E:\FR\FM\23AUP2.SGM 23AUP2 51798 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules TABLE V.44—SUMMARY OF ANALYTICAL RESULTS FOR CONSUMER CLOTHES DRYERS TSLS: MANUFACTURER AND CONSUMER IMPACTS Category TSL 1 * TSL 2 * TSL 3 * TSL 4 * TSL 5 * TSL 6 * Manufacturer Impacts Industry NPV (million 2020$) (No-new-standards case INPV = 1,810.1). Industry NPV (% change) .......... 1,785.0 to 1,798.5. 1,766.8 to 1,789.8. 1,694.5 to 1,728.5. 1,368.8 to 1,582.5. 830.1 to 1,675.5 732.4 to 1,632.0. (1.4) to (0.6) ..... (2.4) to (1.1) ..... (6.4) to (4.5) ..... (24.4) to (12.6) (54.1) to (7.4) ... (59.5) to (9.8). Consumer Average LCC Savings (2020$) Electric Standard ........................ Electric Compact (120 V) ........... Vented Electric Compact (240 V). Vented Gas Standard ................ Vented Gas Compact ................. Ventless Electric Compact (240 V). Ventless Electric Combination Washer/Dryer. Shipment-Weighted Average * ... $252 ................. $115 ................. $94.1 ................ $439 ................. $194 ................. $201 ................. $578 ................. $160 ................. $192 ................. $182 ................. $160 ................. $192 ................. $230 ................. $86.3 ................ $123 ................. $230. ($62.6). ($94.8). $77.7 ................ $25.2 ................ .......................... $174 ................. $23.5 ................ $145 ................. $198 ................. $25.2 ................ $145 ................. $198 ................. .......................... $145 ................. $198 ................. $29.4 ................ $145 ................. $43.0. ($38.8). $11.0. .......................... $15.1 ................ $15.1 ................ $15.1 ................ $15.1 ................ ($387). $219 ................. $390 ................. $507 ................. $184 ................. $222 ................. $191. Consumer Simple PBP (years) Electric Standard ........................ Electric Compact (120 V) ........... Vented Electric Compact (240 V). Vented Gas Standard ................ Vented Gas Compact ................. Ventless Electric Compact (240 V). Ventless Electric Combination Washer-Dryer. Shipment-Weighted Average * ... 0.7 .................... 1.7 .................... 2.0 .................... 0.6 .................... 1.5 .................... 1.5 .................... 0.6 .................... 1.8 .................... 1.6 .................... 1.7 .................... 1.8 .................... 1.6 .................... 4.0 .................... 5.3 .................... 4.7 .................... 4.0. 11.0. 12.1. 2.8 .................... 5.1 .................... .......................... 1.6 .................... 6.4 .................... 0.3 .................... 1.9 .................... 5.1 .................... 0.3 .................... 1.9 .................... 0.0 .................... 0.3 .................... 1.9 .................... 7.1 .................... 0.3 .................... 5.5. 16.3. 7.1. .......................... 0 ....................... 0 ....................... 0 ....................... 0 ....................... 27.5. 1.0 .................... 0.8 .................... 0.8 .................... 1.7 .................... 3.6 .................... 4.5. Percent of Consumers that Experience a Net Cost Electric Standard ........................ Electric Compact (120 V) ........... Vented Electric Compact (240 V). Vented Gas Standard ................ Vented Gas Compact ................. Ventless Electric Compact (240 V). Ventless Electric Combination Washer-Dryer. Shipment-Weighted Average * ... 0.32% ............... 5.66% ............... 8.63% ............... 0.16% ............... 4.46% ............... 4.35% ............... 0.11% ............... 21.6% ............... 8.37% ............... 53.5% ............... 21.6% ............... 8.37% ............... 53.1% ............... 53.0% ............... 47.0% ............... 53.1%. 76.3%. 79.6%. 6.04% ............... 32.7% ............... .......................... 1.66% ............... 50.2% ............... 0% .................... 3.74% ............... 32.7% ............... 0% .................... 3.74% ............... .......................... 0% .................... 3.74% ............... 51.9% ............... 0% .................... 59.3%. 78.8%. 66.4%. .......................... 0% .................... 0% .................... 0% .................... 0% .................... 89.8%. 1.33% ............... 0.45% ............... 0.81% ............... 44.4% ............... 44.5% ............... 54.7%. lotter on DSK11XQN23PROD with PROPOSALS2 Parentheses indicate negative (¥) values. * Weighted by shares of each product class in total projected shipments in 2027. DOE first considered TSL 6, which represents the max-tech efficiency levels, which includes the design parameters of the most efficient products available on the market or in working prototypes for all product classes. The max-tech design options include heat pump technology for electric consumer clothes dryers and inlet air preheat technology for gas consumer clothes dryers. DOE’s shipments analysis estimates approximately 1 percent of annual consumer clothes dryer shipments currently meet this level. TSL 6 would save an estimated 10.1 quads of energy, VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 an amount DOE considers significant. Under TSL 6, the NPV of consumer benefit would be $6.60 billion using a discount rate of 7 percent, and $25.7 billion using a discount rate of 3 percent. The cumulative emissions reductions at TSL 6 are 360 Mt of CO2, 147 thousand tons of SO2, 531 thousand tons of NOX, 0.88 ton of Hg, 2,592 thousand tons of CH4, and 3.64 thousand tons of N2O. The estimated monetary value of the climate benefits from reduced GHG emissions (associated with the average SC–GHG at a 3-percent discount rate) at TSL 6 is PO 00000 Frm 00066 Fmt 4701 Sfmt 4702 $16.3 billion. The estimated monetary value of the health benefits from reduced SO2 and NOX emissions at TSL 6 is $10.3 billion using a 7-percent discount rate and $27.7 billion using a 3-percent discount rate. Using a 7-percent discount rate for consumer benefits and costs, health benefits from reduced SO2 and NOX emissions, and the 3-percent discount rate case for climate benefits from reduced GHG emissions, the estimated total NPV at TSL 6 is $33.2 billion. Using a 3-percent discount rate for all benefits and costs, the estimated total NPV at TSL 6 is $69.7 billion. E:\FR\FM\23AUP2.SGM 23AUP2 lotter on DSK11XQN23PROD with PROPOSALS2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules At TSL 6, the average LCC impact on affected consumers is a savings of $230 for electric standard (PC1), ($62.6) for electric compact (120V) (PC2), ($94.8) for vented electric compact (240V) (PC3), $43.0 for vented gas standard (PC4), ($38.8) for vented gas compact (PC5), $11.0 for ventless electric compact (240V) (PC6), and ($387) for ventless electric combination washerdryer (PC7). The simple payback period is 4.0 years for PC1, 11.0 years for PC2, 12.1 years for PC3, 5.5 years for PC4, 16.3 years for PC5, 7.1years for PC6, and 27.5 years for PC7. The fraction of consumers experiencing a net LCC cost is 53.1 percent for PC1, 76.3 percent for PC2, 79.6 percent for PC3, 59.3 percent for PC4, 78.8 percent for PC5, 66.4 percent for PC6, and 89.8 percent for PC7. Overall, across the product classes a majority of consumers will experience a net LCC cost, especially for senior households. DOE estimated that more 65 percent of senior consumers will experience a net LCC cost at TSL 6. At TSL 6, the projected change in INPV ranges from a decrease of $1,077.6 million to a decrease of $178.0 million, which correspond to decreases of 59.5 percent and 9.8 percent, respectively. The loss in INPV is largely driven by industry conversion costs as manufacturer work to redesign their portfolio of model offerings and re-tool entire factories to comply with amended standards at this level. Industry conversion costs could reach $1,280.0 million at this TSL. Conversion costs at TSL 6 are significant as nearly all existing consumer clothes dryer models would need to be redesigned to meet the maxtech efficiencies. For the electric clothes dryer product classes, manufacturers would need to implement the most efficient heat pump technology to meet max-tech levels. Of the eight OEMs that offer domestic heat pump models, four of them already offer models that meet the efficiencies required by TSL 6. These four OEMs specialize in highefficiency clothes dryers, but currently produce low volumes of products for the U.S. market. For the other four manufacturers of heat pump models, which have the most domestic sales and account for an estimated 72 percent of total annual clothes dryer shipments, TSL 6 would require substantial additional investments to their current heat pump product lines to produce cost-optimized models at the max-tech efficiency level. Seven out of 15 OEMs identified do not offer any models for the domestic market that utilize heat pump technology. A standard that could only be met using heat pump technology would require a total VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 renovation of existing production facilities and would require most manufacturers to design completely new clothes dryer platforms, as they would not be able to maintain the resistive heating designs that currently dominate the U.S. electric clothes dryer market. In interviews, several manufacturers expressed concern about a potential shortage of products given the required scale of investment, redesign efforts, and compliance timeline. For gas clothes dryers, manufacturers would need to implement inlet air preheat technology along with other design options to meet the efficiency levels required by TSL 6. Thus far, dryers with this technology and performance have not been observed in clothes dryers available on the consumer market. Clothes dryers with inlet air preheat designs have been observed only in laboratory settings. In interviews, some manufacturers raised concerns about implementing a relatively untested technology for the consumer market. There is very little industry experience with inlet air preheat designs. Several manufacturers speculated that implementing inlet air preheat would require a major overhaul of existing production facilities and a significant amount of engineering time. At this level, DOE estimated a 13percent drop in shipments in the year the standard takes effect, as pricesensitive consumers may forgo purchasing a new clothes dryer or rely on alternatives such as laundromats or clothes dryer rentals due to the increased upfront cost of baseline models. The Secretary tentatively concludes that at TSL 6 for consumer clothes dryers, the benefits of energy savings, positive NPV of consumer benefits, emission reductions, and the estimated monetary value of the emissions reductions would be outweighed by the economic burden on many consumers, especially senior consumers, as well as the impacts on manufacturers, including the potential for large conversion costs and reduction in INPV. TSL 6, representing the most efficient heat pump technology on the market, would provide significant energy savings potential, as discussed. Despite the current and potential future benefits of heat pump technology, at TSL 6, the analysis indicates that a significant fraction of electric and vented gas standard clothes dryer consumers, including low-income and senior consumers, would experience a net cost given the current relatively high incremental cost of electric and vented gas standard clothes dryers at the maxtech efficiency level. This is particularly PO 00000 Frm 00067 Fmt 4701 Sfmt 4702 51799 pronounced for electric standard clothes dryers, where the incremental production cost at the max-tech efficiency level is comparable to the manufacturer production cost for the baseline efficiency level. Consumers with existing electric standard clothes dryers below EL 4 (about 34 percent) and consumers with existing vented gas standard clothes dryers below EL 3 (about 58 percent) are more likely to experience a net cost at TSL 6, given the relatively modest decrease in operating costs compared to the high incremental installed costs. Few products currently meet the efficiency levels required by TSL 6. DOE estimates that approximately 1 percent of current shipments meet the max-tech efficiencies. At max-tech, limited industry experience by certain manufacturers with the high-efficiency design options, the large conversion costs to update facilities and product designs, and expected drop in industry shipments would result in a reduction of INPV and a potential shortage of products given the required scale of investment, redesign efforts, and time constraints. Consequently, the Secretary has tentatively concluded that TSL 6 is not economically justified. DOE then considered TSL 5, which represents the maximum energy savings with positive NPV. TSL 5 corresponds to the max-tech level, which represents heat pump technology, for the electric standard product class, and the ELs corresponding to inlet air preheat technology in the electric compact (120V) and vented electric compact (240V) product classes considered in this analysis. For gas consumer clothes dryer product classes, TSL 5 corresponds to EL 3, which represents modulating (2-stage) heating technology. TSL 5 would save an estimated 9.97 quads of energy, an amount DOE considers significant. Under TSL 5, the NPV of consumer benefit would be $7.76 billion using a discount rate of 7 percent, and $27.8 billion using a discount rate of 3 percent. The cumulative emissions reductions at TSL 5 are 354 Mt of CO2, 147 thousand tons of SO2, 516 thousand tons of NOX, 0.88 ton of Hg, 2,519 thousand tons of CH4, and 3.64 thousand tons of N2O. The estimated monetary value of the climate benefits from reduced GHG emissions (associated with the average SC–GHG at a 3-percent discount rate) at TSL 5 is $16.0 billion. The estimated monetary value of the health benefits from reduced SO2 and NOX emissions at TSL 5 is $ 10.2 billion using a 7-percent discount rate and $27.3 billion using a 3-percent discount rate. E:\FR\FM\23AUP2.SGM 23AUP2 lotter on DSK11XQN23PROD with PROPOSALS2 51800 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules Using a 7-percent discount rate for consumer benefits and costs, health benefits from reduced SO2 and NOX emissions, and the 3-percent discount rate case for climate benefits from reduced GHG emissions, the estimated total NPV at TSL 5 is $33.9 billion. Using a 3-percent discount rate for all benefits and costs, the estimated total NPV at TSL 5 is $71.1 billion. At TSL 5, the average LCC impact on affected consumers is a savings of $230 for electric standard (PC1), $86.3 for electric compact (120V) (PC2), $123 for vented electric compact (240V) (PC3), $198 for vented gas standard (PC4), $29.4 for vented gas compact (PC5), $145 for ventless electric compact (240V) (PC6), and $15.1 for ventless electric combination washer-dryer (PC7). The simple payback period is 4.0 years for PC1, 5.3 years for PC2, 4.7 years for PC3, 1.9 years for PC4, 7.1 years for PC5, 0.3 years for PC6, and 0 years for PC7. The fraction of consumers experiencing a net LCC cost is 53.1 percent for PC1, 53.0 percent for PC2, 47.0 percent for PC3, 3.74 percent for PC4, 51.9 percent for PC5, zero percent for PC6 and PC 7. Overall, across the product classes, more than 40 percent of the consumers will experience a net LCC cost, especially for senior households. DOE estimated that more 55 percent of senior consumers will experience a net LCC cost at TSL 5. At TSL 5, the projected change in INPV ranges from a decrease of $980.0 million to a decrease of $134.5 million, which correspond to decreases of 54.1 percent and 7.4 percent, respectively. Industry conversion costs could reach $1,164.2 million at this TSL. DOE’s shipments analysis estimates approximately 9 percent of annual shipments currently meet this level. The efficiency level for electric standard dryers, which account for 81 percent of annual shipments, is the same as at max-tech, and would be associated with the same current and potential future benefits as the market share of clothes dryers with heat pump technology continues to grow over time. Nonetheless, requiring heat pump technology for electric standard dryers at this time would result in similar conversion costs, reduction in INPV, and drop in shipments as TSL 6. For the electric compact (120V) and vented electric compact (240V) dryers, the design options include implementing inlet air preheat. In its review of the compact electric models commercially available on the U.S. market at this time, DOE did not identify any that incorporate the inlet air preheat technology option. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 For the vented gas product classes, which account for approximately 17 percent of total annual shipments, the design options include implementing modulating (2-stage) heating technology along with other features. DOE’s shipments analysis estimates that approximately 43 percent of gas clothes dryer shipments currently meet the efficiencies required by TSL 5. All seven manufacturers of gas clothes dryers offer products that meet or exceed the efficiencies required at TSL 5. DOE does not believe that there are any substantive barriers to modulating (2stage) heating technology. Capital conversion costs would be necessary as manufacturers increase tooling for 2stage heating systems. Product conversion costs would be necessary for cost-optimizing and testing new designs for a market with amended standards. At this level, DOE expects an estimated 12-percent drop in shipments in the year the standard takes effect, as price-sensitive consumers may forgo purchasing a new clothes dryer or rely on alternatives such as laundromats or clothes dryer rentals due to the increased upfront cost of baseline models. The Secretary tentatively concludes that at TSL 5 for consumer clothes dryers, the benefits of energy savings, positive NPV of consumer benefits, emission reductions, and the estimated monetary value of the emissions reductions would be outweighed by the economic burden on many consumers, especially senior consumers, as well as the impacts on manufacturers, including the significant conversion costs and large potential reduction in INPV. A significant fraction of electric standard clothes dryer consumers, including lowincome and senior consumers, would experience a net cost. This is due to the high incremental cost of electric standard clothes dryers at the max-tech efficiency level. Consumers with existing electric standard clothes dryers below EL 4 are more likely to experience a net cost at TSL 5, given the relatively modest decrease in operating costs compared to the high incremental installed costs. DOE estimates that approximately 9 percent of shipments currently meet the efficiencies required by this TSL. At TSL 5, the limited industry experience with the highefficiency design options, particularly for electric standard dryers which account for 81 percent of total shipments, the substantial conversion costs required to update facilities and product designs, and expected drop in industry shipments would result in a reduction in INPV and a potential shortage of electric standard dryers PO 00000 Frm 00068 Fmt 4701 Sfmt 4702 given the scale of required investment, redesign efforts, and time constraints. Consequently, the Secretary has tentatively concluded that TSL 5 is not economically justified. DOE then considered TSL 4, which represents the maximum national energy savings with simple PBP less than 4 years for each product class. TSL 4 corresponds to the EL that represents inlet air preheat technology for the electric standard product class considered in this analysis. For the electric compact (120V) and vented electric compact (240V) product classes, TSL 4 corresponds to EL 4, which represents modulating (2-stage) heating technology. For the vented gas standard product class, TSL 4 corresponds to EL 3 which also represents modulating (2stage) heating technology. TSL 4 would save an estimated 4.06 quads of energy, an amount DOE considers significant. Under TSL 4, the NPV of consumer benefit would be $7.13 billion using a discount rate of 7 percent, and $18.4 billion using a discount rate of 3 percent. The cumulative emissions reductions at TSL 4 are 149 Mt of CO2, 57.2 thousand tons of SO2, 228 thousand tons of NOX, 0.34 ton of Hg, 1,111 thousand tons of CH4, and 1.44 thousand tons of N2O. The estimated monetary value of the climate benefits from reduced GHG emissions (associated with the average SC–GHG at a 3-percent discount rate) at TSL 4 is $6.89 billion. The estimated monetary value of the health benefits from reduced SO2 and NOX emissions at TSL 4 is $4.52 billion using a 7-percent discount rate and $11.7 million using a 3-percent discount rate. Using a 7-percent discount rate for consumer benefits and costs, health benefits from reduced SO2 and NOX emissions, and the 3-percent discount rate case for climate benefits from reduced GHG emissions, the estimated total NPV at TSL 4 is $18.5 billion. Using a 3-percent discount rate for all benefits and costs, the estimated total NPV at TSL 4 is $37.0 billion. At TSL 4, the average LCC impact on affected consumers is a savings of $182 for electric standard (PC1), $160 for electric compact (120V) (PC2), $192 for vented electric compact (240V) (PC3), $198 for vented gas standard (PC4), $145 for ventless electric compact (PC6), and $15.1 for ventless electric combination washer-dryer (PC7). The simple payback period is 1.7 years for PC1, 1.8 years for PC2, 1.6 years for PC3, 1.9 years for PC4, 0.3 years for PC6, and 0 years for PC7. The fraction of consumers experiencing a net LCC cost is 53.5 percent for PC1, 21.6 percent for E:\FR\FM\23AUP2.SGM 23AUP2 lotter on DSK11XQN23PROD with PROPOSALS2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules PC2, 8.37 percent for PC3, 3.74 percent for PC4, zero percent for PC6 and PC 7.88 Overall, across the product classes, more than 40 percent of the consumers will experience a net LCC cost, especially for senior households. DOE estimated that about 50 percent of senior consumers will experience a net LCC cost at TSL 4. At TSL 4, the projected change in INPV ranges from a decrease of $441.3 million to a decrease of $227.6 million, which correspond to decreases of 24.4 percent and 12.6 percent, respectively. Industry conversion costs could reach $561.7 million at this TSL. At TSL 4, the majority of consumer clothes dryer models would need to be redesigned to meet the efficiency levels required. DOE’s shipments analysis estimates approximately 11 percent of current shipments meet this level. For electric standard dryers, the design options include implementing inlet air preheat and other features. As previously noted, electric standard dryers account for approximately 81 percent of total shipments. There is very little industry experience with inlet air preheat designs. Currently, DOE is not aware of any consumer clothes dryers on the market utilizing this design option. DOE’s shipments analysis estimates that approximately 4 percent of electric standard shipments currently meet the efficiency required by TSL 4. Implementing inlet air preheat for electric standard dryers would represent a major overhaul of existing product lines and manufacturing facilities. This change would necessitate significant investments in new equipment and tooling. Product conversion costs would be necessary for designing, prototyping, and testing new or updated platforms. For vented gas standard clothes dryers, the design options at TSL 4 are the same as at TSL 5. DOE does not believe that there are any substantive barriers to modulating (2-stage) heating technology. Capital conversion costs may be necessary as manufacturers increase tooling for 2-stage heating systems. Product conversion costs may be necessary for cost-optimizing and testing new designs for a market with amended standards. At this level, DOE does not expect a notable drop in shipments in the year the standard takes effect. The Secretary tentatively concludes that at TSL 4 for consumer clothes dryers, the benefits of energy savings, positive NPV of consumer benefits, emission reductions, and the estimated 88 No economic impact values are reported for product class 5 under TSL4 because energy efficiency level for the product class is at baseline. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 monetary value of the emissions reductions would be outweighed by the economic burden on many consumers, especially senior consumers, as well as the impacts on manufacturers, including the conversion costs and profit margin impacts that could result in a large reduction in INPV. A significant fraction of electric standard clothes dryer consumers, including senior consumers, would experience a net cost. This is due to the high incremental cost of electric standard clothes dryers at the inlet air preheat technology efficiency level. Consumers with existing electric standard clothes dryers below EL 4 are more likely to experience a net cost at TSL 4, given the relatively modest decrease in operating costs compared to the high incremental installed costs. Consequently, the Secretary has tentatively concluded that TSL 4 is not economically justified. DOE then considered TSL 3, which represents a set of intermediate efficiency levels between those designated in TSL 2 and TSL 4 and corresponds to the current ENERGY STAR efficiency level for vented electric standard dryers, which represent over 80 percent of the market. TSL 3 corresponds to the EL that represents modulating (2-stage) heating technology for the electric standard, electric compact (120V), and vented electric compact (240V) product classes. For the vented gas standard product class, TSL 3 corresponds to EL 3, which also represents modulating (2-stage) heating technology. For the vented gas compact product class, TSL 3 corresponds to EL 1, which represents a baseline model with electronic controls. For the ventless electric (240V) product class, TSL 3 corresponds to EL 1, which represents a baseline model with a more advanced automatic termination control system. For the ventless electric combination washer-dryer product class, TSL 3 corresponds to EL 1, which represents a baseline model with highspeed spin technology. TSL 3 would save an estimated 3.11 quads of energy, an amount DOE considers significant. Under TSL 3, the NPV of consumer benefit would be $9.07 billion using a discount rate of 7 percent, and $20.8 billion using a discount rate of 3 percent. The cumulative emissions reductions at TSL 3 are 116 Mt of CO2, 42.6 thousand tons of SO2, 181 thousand tons of NOX, 0.26 ton of Hg, 883 thousand tons of CH4, and 1.09 thousand tons of N2O. The estimated monetary value of the climate benefits from reduced GHG emissions (associated with the average SC–GHG at a 3-percent discount rate) at TSL 3 is PO 00000 Frm 00069 Fmt 4701 Sfmt 4702 51801 $5.42 billion. The estimated monetary value of the health benefits from reduced SO2 and NOX emissions at TSL 3 is $3.59 billion using a 7-percent discount rate and $9.14 billion using a 3-percent discount rate. Using a 7-percent discount rate for consumer benefits and costs, health benefits from reduced SO2 and NOX emissions, and the 3-percent discount rate case for climate benefits from reduced GHG emissions, the estimated total NPV at TSL 3 is $18.1 billion. Using a 3-percent discount rate for all benefits and costs, the estimated total NPV at TSL 3 is $35.4 billion. At TSL 3, the average LCC impact on affected consumers is a savings of $578 for electric standard (PC1), $160 for electric compact (120V) (PC2), $192 for vented electric compact (240V) (PC3), $198 for vented gas standard (PC4), $25.2 for PC5, $145 for ventless electric compact (PC6), and $15.1 for ventless electric combination washer-dryer (PC7). The simple payback period is 0.6 years for the largest product class (PC1), 1.8 years for PC2, 1.6 years for PC3, 1.9 years for PC4, 5.1 years for PC5, 0.3 years for PC6, and 0 years for PC7. The fraction of consumers experiencing a net LCC cost is 0.11 percent for PC1, 21.6 percent for PC2, 8.37 percent for PC3, 3.74 percent for PC4, 32.7 percent for PC5, and zero percent for PC6 and PC7. Overall, across the product classes, less than 1 percent of the consumers, including low-income consumers, will experience a net LCC cost. For senior consumers, DOE estimated that 1 percent will experience a net LCC cost at TSL 3. At TSL 3, the projected change in INPV ranges from a decrease of $115.6 million to a decrease of $81.6 million, which correspond to decreases of 6.4 percent and 4.5 percent, respectively. Industry conversion costs could reach $149.7 million at this TSL. DOE expects that some existing consumer clothes dryer models would need to be redesigned to meet TSL 3 efficiencies, but there are a wide range of available models for vented electric standard dryers due to participation in the ENERGY STAR program. DOE’s shipments analysis estimates approximately 59 percent of annual shipments currently meet this level. For electric standard, compact electric (120V), vented electric compact (240V), and vented gas standard clothes dryers, which account for over 98 percent of total annual shipments, the design options include implementing electronic controls, optimized heating systems, more advanced automatic termination controls, and modulating (2-stage) heat. Of the 15 electric dryer E:\FR\FM\23AUP2.SGM 23AUP2 51802 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules OEMs, 13 offer products at or above the efficiencies required for the electric dryer product classes at TSL 3. As previously noted, all seven OEMs of vented gas standard dryers offer products at or above the efficiency required at TSL 3. Capital conversion costs may be necessary as manufacturers increase tooling for 2-stage heating systems. Manufacturers may choose to further cost-optimize and test new designs as a result of the standards, but DOE believes some of this has already occurred in response to ENERGY STAR for vented electric standard dryers. DOE does not expect any drop in shipments in the year the standard takes effect. After considering the analysis and weighing the benefits and burdens, the Secretary has tentatively concluded that a standard set at TSL 3 for consumer clothes dryers would result in the maximum improvement in energy efficiency that is technologically feasible and economically justified and would result in the significant conservation of energy. At this TSL, the average LCC savings for all consumer clothes dryer product classes are positive. An estimated weighted average of less than 1 percent of consumer clothes dryer consumers would experience a net cost. The FFC national energy savings are significant and the NPV of consumer benefits is positive using both a 3-percent and 7-percent discount rate. Notably, the benefits to consumers vastly outweigh the cost to manufacturers. At TSL 3, the NPV of consumer benefits, even measured at the more conservative discount rate of 7 percent, is over 78 times higher than the maximum estimated manufacturers’ loss in INPV. The positive LCC savings—a different way of quantifying consumer benefits—reinforces this conclusion. The standard levels at TSL 3 are economically justified even without weighing the estimated monetary value of emissions reductions. When those emissions reductions are included— representing $5.42 billion in climate benefits (associated with the average SC–GHG at a 3-percent discount rate), and $9.14 billion (using a 3-percent discount rate) or $3.59 billion (using a 7-percent discount rate) in health benefits—the rationale becomes stronger still. As stated, DOE conducts a ‘‘walkdown’’ analysis to determine the TSL that represents the maximum improvement in energy efficiency that is technologically feasible and economically justified as required under EPCA. The walk-down is not a comparative analysis, as a comparative analysis would result in the maximization of net benefits instead of energy savings that are technologically feasible and economically justified, and would be contrary to the statute. 86 FR 70892, 70908. Although DOE has not conducted a comparative analysis to select the proposed energy conservation standards, DOE notes that as compared to TSL 6, TSL 5, and TSL 4—TSL 3 has higher average LCC savings, smaller percentages of consumer experiencing a net cost, a lower maximum decrease in INPV, and lower manufacturer conversion costs. Accordingly, the Secretary has tentatively concluded that TSL 3 would offer the maximum improvement in efficiency that is technologically feasible and economically justified and would result in the significant conservation of energy. For electric standard and vented gas standard consumer clothes dryers, which account for approximately 98 percent of U.S. shipments, requiring efficiency levels above the levels required by TSL 3 result in a large percentage of consumers experiencing a net LCC cost, in addition to significant manufacturer impacts and reductions in INPV. Additionally, for consumer clothes dryers, nearly all manufacturers offer products that can meet TSL 3 across both electric and gas consumer clothes dryers. In addition, DOE is proposing to adopt TSL 3, which corresponds to the current ENERGY STAR levels for electric standard and ventless compact electric (240V), which have significant market share and manufacturer support due to their promotion over the past couple of years as a voluntary energyefficiency program. The adoption of standards, if finalized as proposed, at this TSL may encourage ENERGY STAR to further consider more-efficient levels for dryers in the year leadings up to the compliance of date of the standard, which would in turn likely spur additional market introductions of consumer clothes dryers with heat pump technology, foster maturation of the technology and downward price trends, and further support differentiation within the dryer market for energy efficient products. For electric and vented gas standard consumer clothes dryers, TSL 3 is comprised of EL 4 and EL 3, respectively, resulting in higher LCC savings, a significant reduction in the number of consumers experiencing a net cost, a lower maximum decrease in INPV, and lower conversion costs to the point where DOE has tentatively concluded they are economically justified, as discussed for TSL 3 in the preceding paragraphs. Therefore, based on the previous considerations, DOE proposes to adopt the energy conservation standards for consumer clothes dryers at TSL 3. The proposed amended energy conservation standards for consumer clothes dryers, which are expressed as CEFD2, are shown in Table V.45. TABLE V.45—PROPOSED AMENDED ENERGY CONSERVATION STANDARDS FOR CONSUMER CLOTHES DRYERS CEFD2 (lb/kWh) Product class lotter on DSK11XQN23PROD with PROPOSALS2 Electric, Standard (4.4 cubic feet (‘‘ft3’’) or greater capacity) ............................................................................................................. Electric, Compact (120 volts (‘‘V’’)) (less than 4.4 ft3 capacity) .......................................................................................................... Vented Electric, Compact (240V) (less than 4.4 ft3 capacity) ............................................................................................................ Ventless Electric, Compact (240V) (less than 4.4 ft3 capacity) .......................................................................................................... Ventless Electric, Combination Washer-Dryer .................................................................................................................................... Vented Gas, Standard (4.4 ft3 or greater capacity) ............................................................................................................................ Vented Gas, Compact (less than 4.4 ft3 capacity) .............................................................................................................................. 2. Annualized Benefits and Costs of the Proposed Standards The benefits and costs of the proposed standards can also be expressed in terms of annualized values. The annualized net benefit is (1) the annualized national VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 economic value (expressed in 2020$) of the benefits from operating products that meet the proposed standards (consisting primarily of operating cost savings from using less energy, minus increases in product purchase costs, and PO 00000 Frm 00070 Fmt 4701 Sfmt 4702 3.93 4.33 3.57 2.68 2.33 3.48 2.02 (2) the annualized monetary value of the benefits of GHG and NOX emission reductions. Table V.46 shows the annualized values for consumer clothes dryers under TSL 3, expressed in 2020$. The E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules results under the primary estimate are as follows. Using a 7-percent discount rate for consumer benefits and costs and NOX and SO2 reduction benefits, and a 3percent discount rate case for GHG social costs, the estimated cost of the proposed standards for consumer clothes dryers is $85.7 million per year in increased equipment costs, while the estimated annual benefits are $1,111 million from reduced equipment operating costs, $320 million from GHG reductions, and $406 million from reduced NOX and SO2 emissions. In this case, the net benefit amounts to $1,752 million per year. Using a 3-percent discount rate for all benefits and costs, the estimated cost of the proposed standards for consumer 51803 clothes dryers is $80.7 million per year in increased equipment costs, while the estimated annual benefits are $1,313 million in reduced operating costs, $320 million from GHG reductions, and $541 million from reduced NOX and SO2 emissions. In this case, the net benefit amounts to $2,094 million per year. TABLE V.46—ANNUALIZED MONETIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR CONSUMER CLOTHES DRYERS [TSL 3] Million 2020$/year Primary estimate Low-netbenefits estimate High-netbenefits estimate 3% discount rate Consumer Operating Cost Savings ............................................................................................. Climate Benefits * ......................................................................................................................... Health Benefits ** ......................................................................................................................... Total Benefits † ............................................................................................................................ Consumer Incremental Product Costs ‡ ...................................................................................... Net Benefits ................................................................................................................................. 1,313 320 541 2,174 80.7 2,094 1,227 311 526 2,065 80.5 1,984 1,403 327 551 2,280 76.6 2,204 1,111 320 406 1,837 85.7 1,752 1,050 311 395 1,757 85.3 1,671 1,178 327 413 1,917 82.4 1,835 7% discount rate Consumer Operating Cost Savings ............................................................................................. Climate Benefits * ......................................................................................................................... Health Benefits ** ......................................................................................................................... Total Benefits † ............................................................................................................................ Consumer Incremental Product Costs ‡ ...................................................................................... Net Benefits ................................................................................................................................. Note: This table presents the costs and benefits associated with consumer clothes dryers shipped in 2027–2056. These results include benefits to consumers which accrue after 2056 from the products shipped in 2027–2056. * Climate benefits are calculated using four different estimates of the social cost of carbon (SC–CO2), methane (SC–CH4), and nitrous oxide (SC–N2O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates; 95th percentile at 3 percent discount rate). Together these represent the global social cost of greenhouse gases (SC–GHG). For presentational purposes of this table, the climate benefits associated with the average SC–GHG at a 3 percent discount rate are shown, but the Department does not have a single central SC–GHG point estimate. See section. IV.L of this document for more details. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22–30087) granted the Federal government’s emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued in Louisiana v. Biden, No. 21–cv– 1074–JDC–KK (W.D. La.). As a result of the Fifth Circuit’s order, the preliminary injunction is no longer in effect, pending resolution of the Federal government’s appeal of that injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in that case from ‘‘adopting, employing, treating as binding, or relying upon’’ the interim estimates of the social cost of greenhouse gases—which were issued by the Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 2021—to monetize the benefits of reducing greenhouse gas emissions. As reflected in this rule, DOE has reverted to its approach prior to the injunction and presents monetized greenhouse gas abatement benefits where appropriate and permissible under law. ** Health benefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only monetizing (for SO2 and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits, but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM2.5 emissions. The health benefits are presented at real discount rates of 3 and 7 percent. See section IV.L of this document for more details. † Total benefits for both the 3-percent and 7-percent cases are presented using the average SC–GHG with 3-percent discount rate, but the Department does not have a single central SC–GHG point estimate. DOE emphasizes the importance and value of considering the benefits calculated using all four SC–GHG estimates. ‡ Costs include incremental equipment costs as well as installation costs. lotter on DSK11XQN23PROD with PROPOSALS2 D. Reporting, Certification, and Sampling Plan In addition to reporting cycle time, the California IOUs also encouraged DOE to incorporate refrigerant type and charge quantity into the reporting requirement for any products that use heat pump technology, stating that the regulatory landscape around refrigerant types and charge quantity has been changing rapidly and disclosure of these two parameters would be useful for VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 compliance with those requirements. The California IOUs also stated that ENERGY STAR currently allows manufacturers to voluntarily disclose the refrigerant type. (California IOUs, No. 26 at p. 6) DOE will continue to monitor the regulatory landscape around refrigerants in the consumer clothes dryer industry, and if DOE determines that the additional reporting information would be useful, DOE may consider requiring that information in a future separate PO 00000 Frm 00071 Fmt 4701 Sfmt 4702 rulemaking that would address any necessary amendments to reporting requirements for all covered products and equipment. Manufacturers, including importers, must use product-specific certification templates to certify compliance to DOE. For consumer clothes dryers, the certification template reflects the general certification requirements specified at 10 CFR 429.12 and the product-specific requirements specified at 10 CFR 429.21. As discussed in the E:\FR\FM\23AUP2.SGM 23AUP2 51804 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules previous paragraphs, DOE is not proposing to amend the product-specific certification requirements for consumer clothes dryers. lotter on DSK11XQN23PROD with PROPOSALS2 VI. Procedural Issues and Regulatory Review A. Review Under Executive Orders 12866 and 13563 Executive Order (‘‘E.O.’’) 12866, ‘‘Regulatory Planning and Review,’’ as supplemented and reaffirmed by E.O. 13563, ‘‘Improving Regulation and Regulatory Review, 76 FR 3821 (Jan. 21, 2011), requires agencies, to the extent permitted by law, 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 E.O. 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. For the reasons stated in the preamble, this proposed regulatory action is consistent with these principles. Section 6(a) of E.O. 12866 also requires agencies to submit ‘‘significant regulatory actions’’ to the OIRA for review. OIRA has determined that this proposed regulatory action constitutes an economically significant regulatory action under section 3(f) of E.O. 12866. Accordingly, pursuant to section 6(a)(3)(C) of E.O. 12866, DOE has VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 provided to OIRA an assessment, including the underlying analysis, of benefits and costs anticipated from the proposed/final regulatory action, together with, to the extent feasible, a quantification of those costs; and an assessment, including the underlying analysis, of costs and benefits of potentially effective and reasonably feasible alternatives to the planned regulation, and an explanation why the planned regulatory action is preferable to the identified potential alternatives. These assessments are summarized in this preamble and further detail can be found in the technical support document for this rulemaking. 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 E.O. 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 7990. DOE has made its procedures and policies available on the Office of the General Counsel’s website (energy.gov/gc/officegeneral-counsel). DOE has not prepared an IRFA for the products that are the subject of this proposed rulemaking. DOE reviewed this proposed rule under the provisions of the Regulatory Flexibility Act and the procedures and policies published on February 19, 2003. DOE certifies that the proposed rule, if adopted, would not have significant economic impact on a substantial number of small entities. The factual basis of this certification is set forth in the following paragraphs. In accordance with EPCA, DOE is publishing this NOPR as part of the legislated 6-year review of energy conservation standards for consumer clothes dryers. (42 U.S.C. 6295(m)) The most recent standards rulemaking for consumer clothes dryers was promulgated on April 21, 2011. Specifically, DOE published a direct final rule (the ‘‘2011 Direct Final Rule’’) amending the energy conservation standard for consumer clothes dryers manufactured on and after January 1, 2015. 76 FR 22454 (Apr. 21, 2011). Pursuant to EPCA, any new or amended PO 00000 Frm 00072 Fmt 4701 Sfmt 4702 energy conservation standard must be designed to achieve the maximum improvement in energy efficiency that DOE determines is technologically feasible and economically justified. (42 U.S.C. 6295(o)(2)(A)) Furthermore, the new or amended standard must result in a significant conservation of energy. (42 U.S.C. 6295(o)(3)(B)) EPCA also provides that not later than 6 years after issuance of any final rule establishing or amending a standard, DOE must publish either a notice of determination that standards for the product do not need to be amended, or a NOPR including new proposed energy conservation standards (proceeding to a final rule, as appropriate). (42 U.S.C. 6295(m)) For manufacturers of consumer clothes dryers, 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. (See 13 CFR part 121.) The size standards are listed by North American Industry Classification System (‘‘NAICS’’) code and industry description and are available at www.sba.gov/document/support-tablesize-standards. Manufacturing of consumer clothes dryers is classified under NAICS 335220, ‘‘Major Household Appliance Manufacturing.’’ The SBA sets a threshold of 1,500 employees or fewer for an entity to be considered as a small business for this category. To estimate the number of companies that could be small business manufacturers of products covered by this rulemaking, DOE conducted a market survey using public information and subscription-based company reports to identify potential small business manufacturers. DOE reviewed the CCMS database,89 California Energy Commission’s Modernized Appliance Efficiency Database System (‘‘MAEDbS’’),90 the ENERGY STAR Product Finder dataset,91 individual company websites, import/export logs, and product specifications to create a list of companies that manufacture, produce, import, or private label the products covered by this rulemaking. 89 U.S. Department of Energy’s Compliance Certification Database is available at regulations.doe.gov/certification-data (last accessed October 8, 2021). 90 California Energy Commission’s Modernized Appliance Efficiency Database System is available at cacertappliances.energy.ca.gov/Pages/ ApplianceSearch.aspx (last accessed October 8, 2021). 91 ENERGY STAR Product Finder is available at energystar.gov/productfinder/ (last accessed October 8, 2021). E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules lotter on DSK11XQN23PROD with PROPOSALS2 DOE relied on public information and market research tools (e.g., reports from Dun and Bradstreet 92) to determine company structure, location, headcount, and annual revenue. DOE screened out companies that do not manufacture the products covered by this rulemaking, do not meet the SBA’s definition of a ‘‘small business,’’ or are foreign-owned and operated. DOE also asked stakeholders and industry representatives if they were aware of any small manufacturers during manufacturer interviews and through requests for comment. DOE identified 15 OEMs of the covered product. Of these 15 OEMs, DOE determined none of them qualify as a domestic ‘‘small business manufacturer’’ of consumer clothes dryers. Given the lack of small domestic OEMs with a direct compliance burden, DOE concludes that the proposed rule would not have ‘‘a significant impact on a substantial number of small entities.’’ DOE requests comment on this certification conclusion. DOE will transmit the certification and supporting statement of factual basis to the Chief Counsel for Advocacy of the Small Business Administration for review under 5 U.S.C. 605(b). C. Review Under the Paperwork Reduction Act Manufacturers of consumer clothes dryers must certify to DOE that their products comply with any applicable energy conservation standards. In certifying compliance, manufacturers must test their products according to the DOE test procedures for consumer clothes dryers, 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 equipment, including consumer clothes dryers. 76 FR 12422 (Mar. 7, 2011); 80 FR 5099 (Jan. 30, 2015). 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. In this rulemaking, DOE proposes standards expressed as the combined energy factor, determined in accordance with the appendix D2 test procedure (CEFD2). Were this NOPR to be finalized as proposed, manufacturers of consumer clothes dryers would certify to DOE using the certification template 92 The Dun & Bradstreet subscription login is available at app.dnbhoovers.com. VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 associated with appendix D2 once the standard goes into effect. The public reporting burden under appendix D2 is not substantially different than the public reporting burden under appendix D1 and is already required for ENERGY STAR certification. Adopting standards based on the CEFD2 metric would not cause any measurable change in reporting burden or hours to manufacturers of consumer clothes dryers. Thus, DOE is not proposing any changes to its information collection requirements as these are already accounted for by DOE’s existing regulations. DOE seeks comment on DOE’s estimated burden for certifying compliance under appendix D2 should amended standards be finalized. Public reporting burden for the certification is estimated to average 35 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 DOE is analyzing this proposed regulation in accordance with the National Environmental Policy Act of 1969 (‘‘NEPA’’) and DOE’s NEPA implementing regulations (10 CFR part 1021). DOE’s regulations include a categorical exclusion for rulemakings that establish energy conservation standards for consumer products or industrial equipment. 10 CFR part 1021, subpart D, appendix B5.1. DOE anticipates that this rulemaking qualifies for categorical exclusion B5.1 because it is a rulemaking that establishes energy conservation standards for consumer products or industrial equipment, none of the exceptions identified in categorical exclusion B5.1(b) apply, no extraordinary circumstances exist that require further environmental analysis, and it otherwise meets the requirements for application of a categorical exclusion. See 10 CFR 1021.410. DOE will complete its NEPA review before issuing the final rule. E. Review Under Executive Order 13132 E.O. 13132, ‘‘Federalism,’’ 64 FR 43255 (Aug. 10, 1999), imposes certain requirements on Federal agencies PO 00000 Frm 00073 Fmt 4701 Sfmt 4702 51805 formulating and implementing policies or regulations that preempt State law or that have Federalism implications. The Executive order requires agencies to examine the constitutional and statutory authority supporting any action that would limit the policymaking discretion of the States and to carefully assess the necessity for such actions. The Executive order also requires agencies to have an accountable process to ensure meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications. On March 14, 2000, DOE published a statement of policy describing the intergovernmental consultation process it will follow in the development of such regulations. 65 FR 13735. DOE has examined this proposed rule and has tentatively determined that it would not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. EPCA governs and prescribes Federal preemption of State regulations as to energy conservation for the products that are the subject of this 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) Therefore, 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 E.O. 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, (3) provide a clear legal standard for affected conduct rather than a general standard, and (4) promote simplification and burden reduction. 61 FR 4729 (Feb. 7, 1996). Regarding the review required by section 3(a), section 3(b) of E.O. 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 E:\FR\FM\23AUP2.SGM 23AUP2 51806 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules lotter on DSK11XQN23PROD with PROPOSALS2 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 E.O. 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, section 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 them. On March 18, 1997, DOE published a statement of policy on its process for intergovernmental consultation under UMRA. 62 FR 12820. DOE’s policy statement is also available at energy.gov/sites/prod/files/ gcprod/documents/umra_97.pdf. Although this proposed rule does not contain a Federal intergovernmental mandate, it may require expenditures of $100 million or more in any one year by the private sector. Such expenditures may include: (1) investment in research and development and in capital expenditures by consumer clothes dryer manufacturers in the years between the final rule and the compliance date for the new standards and (2) incremental additional expenditures by consumers to purchase higher-efficiency consumer clothes dryers, 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 VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 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 TSD for this proposed rule respond to those requirements. Under section 205 of UMRA, the Department 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(m) this proposed rule would establish amended energy conservation standards for consumer clothes dryers that are designed to achieve the maximum improvement in energy efficiency that DOE has determined to be both technologically feasible and economically justified, as required by 42 U.S.C. 6295(o)(2)(A) and 42 U.S.C. 6295(o)(3)(B). A full discussion of the alternatives considered by DOE is presented in chapter 17 of the TSD for this 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 Pursuant to E.O. 12630, ‘‘Governmental Actions and Interference with Constitutionally Protected Property Rights,’’ 53 FR 8859 (Mar. 15, 1988), DOE has determined that this proposed rule would not result in any takings that might require compensation under the Fifth Amendment to the U.S. Constitution. PO 00000 Frm 00074 Fmt 4701 Sfmt 4702 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 information quality 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). Pursuant to OMB Memorandum M–19–15, Improving Implementation of the Information Quality Act (April 24, 2019), DOE published updated guidelines which are available at www.energy.gov/sites/prod/files/2019/ 12/f70/DOE%20 Final%20Updated%20IQA% 20Guidelines%20Dec%202019.pdf. DOE has reviewed this 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 E.O. 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 action and their expected benefits on energy supply, distribution, and use. DOE has tentatively concluded that this regulatory action, which proposes amended energy conservation standards for consumer clothes dryers, 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 this proposed rule. E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules L. Information Quality 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 2664, 2667. In response to OMB’s Bulletin, DOE conducted formal peer reviews of the energy conservation standards development process and the analyses that are typically used and has prepared a report describing that peer review.93 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. DOE has determined that the peer-reviewed analytical process continues to reflect current practice, and the Department followed that process for developing energy conservation standards in the case of the present rulemaking. VII. Public Participation lotter on DSK11XQN23PROD with PROPOSALS2 A. Participation in the Webinar The time and date of the webinar are listed in the DATES section at the beginning of this document. Webinar registration information, participant instructions, and information about the capabilities available to webinar participants will be published on DOE’s website: www1.eere.energy.gov/ buildings/appliance_standards/ standards.aspx?productid=50&action= viewlive. Participants are responsible for 93 The 2007 ‘‘Energy Conservation Standards Rulemaking Peer Review Report’’ is available at the following website: energy.gov/eere/buildings/ downloads/energy-conservation-standardsrulemaking-peer-review-report-0 (last accessed November 2021). VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 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 webinar. 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 document. The request and advance copy of statements must be received at least one week before the public meeting and are to be emailed. 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 webinar 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 webinar. There shall not be discussion of proprietary information, costs or prices, market share, or other commercial matters regulated by U.S. anti-trust laws. After the webinar, 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 webinar will be conducted in an informal, conference style. DOE will present a general overview of the topics addressed in this rulemaking, 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. Participants should be prepared to answer questions by DOE and by other participants concerning these issues. DOE representatives may also ask PO 00000 Frm 00075 Fmt 4701 Sfmt 4702 51807 questions of participants concerning other matters relevant to this rulemaking. The official conducting the webinar 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 previous procedures that may be needed for the proper conduct of the webinar. 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 document and will be accessible on the DOE website. 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 document. Submitting comments via www.regulations.gov. The www.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 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 www.regulations.gov information for which disclosure is restricted by statute, such as trade secrets and commercial or financial information (hereinafter referred to as E:\FR\FM\23AUP2.SGM 23AUP2 lotter on DSK11XQN23PROD with PROPOSALS2 51808 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules Confidential Business Information (‘‘CBI’’)). Comments submitted through www.regulations.gov cannot be claimed as CBI. Comments received through the website will waive any CBI claims for the information submitted. For information on submitting CBI, see the Confidential Business Information section. DOE processes submissions made through www.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 www.regulations.gov provides after you have successfully uploaded your comment. Submitting comments via email. Comments and documents submitted via email also will be posted to www.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. No telefacsimiles (‘‘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. Pursuant 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 two well-marked copies: one copy of the document marked ‘‘confidential’’ including all the VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 information believed to be confidential, and one copy of the document marked ‘‘non-confidential’’ with the information believed to be confidential deleted. DOE will make its own determination about the confidential status of the information and treat it according to its determination. 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) DOE seeks comment on the method for estimating manufacturing production costs. (2) DOE seeks comment on additional information regarding potential classification errors within the CCMS database. See section IV.A.1 of this document. (3) DOE requests comment on any potential impacts that different technology options, including any that may impact cycle times, have on fabric care. See section IV.B.1 of this document. (4) DOE seeks comment on the baseline and incremental efficiency levels used in the NOPR engineering analysis. See section IV.C.1 of this document. (5) DOE seeks comment on the baseline and incremental MPCs from the NOPR engineering analysis, as well as any data on the impact of supply chain challenges that could better inform the cost analysis. See section IV.C.3 of this document. (6) DOE seeks comment on product cost trends over time of heat pump technology. See section IV.F.1 of this document. (7) DOE requests information and data on repair cost for replacing an electromechanical and electronic control panel. See section IV.F.5 of this document. (8) DOE seeks input from interested parties on characterizing maintenance and repair costs for more-efficient consumer clothes dryers. See section IV.F.5 of this document. (9) DOE requests comments, information, and data on the no-new-standards case efficiency distribution of consumer clothes dryers. See section IV.F.8 of this document. (10) DOE requests comment on its methodology for estimating shipments. DOE also requests comment on its approach to estimate the market share for each consumer clothes dryer product class. See section IV.G of this document. (11) DOE requests comment on any new information or data that points to an impact on usage due to a change in cycle times (See section IV.H.2 of this document) or changes to cycle times as a result of the proposed standard. Additionally, DOE welcomes comments on other issues relevant to the conduct of this proposed rulemaking PO 00000 Frm 00076 Fmt 4701 Sfmt 4702 that may not specifically be identified in this document. VIII. Approval of the Office of the Secretary The Secretary of Energy has approved publication of this notice of proposed rulemaking. List of Subjects in 10 CFR Part 430 Administrative practice and procedure, Confidential business information, Energy conservation, Household appliances, Imports, Intergovernmental relations, Small businesses. Signing Authority This document of the Department of Energy was signed on August 14, 2022, by Kelly J. Speakes-Backman, Principal Deputy Assistant Secretary for Energy Efficiency and Renewable Energy, pursuant to delegated authority from the Secretary of Energy. That document with the original signature and date is maintained by DOE. For administrative purposes only, and in compliance with requirements of the Office of the Federal Register, the undersigned DOE Federal Register Liaison Officer has been authorized to sign and submit the document in electronic format for publication, as an official document of the Department of Energy. This administrative process in no way alters the legal effect of this document upon publication in the Federal Register. Signed in Washington, DC, on August 16, 2022. Treena V. Garrett, Federal Register Liaison Officer, U.S. Department of Energy. For the reasons set forth in the preamble, DOE proposes to amend part 430 of chapter II, subchapter D, of title 10 of the Code of Federal Regulations, as set forth below: PART 430—ENERGY CONSERVATION PROGRAM FOR CONSUMER PRODUCTS 1. The authority citation for part 430 continues to read as follows: ■ Authority: 42 U.S.C. 6291–6309; 28 U.S.C. 2461 note. 2. Amend § 430.32 by revising the introductory text to paragraph (h)(3) and adding paragraph (h)(4) to read as follows: ■ § 430.32 Energy and water conservation standards and their compliance dates. * * * * * (h) * * * (3) Clothes dryers manufactured on or after January 1, 2015 and before [date 3 E:\FR\FM\23AUP2.SGM 23AUP2 Federal Register / Vol. 87, No. 162 / Tuesday, August 23, 2022 / Proposed Rules years after publication of a final rule], shall have a combined energy factor no less than: * * * * * (4) Clothes dryers manufactured on or after [date 3 years after publication of a final rule], shall have a combined energy factor, determined in accordance with Appendix D2 of this subpart, no less than: CEFD2 (lb/kWh) Product class Electric, Standard (4.4 ft3 or greater capacity) .................................................................................................................................... Electric, Compact (120V) (less than 4.4 ft3 capacity) ......................................................................................................................... Vented Electric, Compact (240V) (less than 4.4 ft3 capacity) ............................................................................................................ Vented Gas, Standard (4.4 ft3 or greater capacity) ............................................................................................................................ Vented Gas, Compact (less than 4.4 ft3 capacity) .............................................................................................................................. Ventless Electric, Compact (240V) (less than 4.4 ft3 capacity) .......................................................................................................... Ventless Electric, Combination Washer-Dryer .................................................................................................................................... * * * * * [FR Doc. 2022–17900 Filed 8–22–22; 8:45 am] lotter on DSK11XQN23PROD with PROPOSALS2 BILLING CODE 6450–01–P VerDate Sep<11>2014 19:56 Aug 22, 2022 Jkt 256001 PO 00000 Frm 00077 Fmt 4701 51809 Sfmt 9990 E:\FR\FM\23AUP2.SGM 23AUP2 3.93 4.33 3.57 3.48 2.02 2.68 2.33

Agencies

DEPARTMENT OF ENERGY

[Federal Register Volume 87, Number 162 (Tuesday, August 23, 2022)]
[Proposed Rules]
[Pages 51734-51809]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-17900]



[[Page 51733]]

Vol. 87

Tuesday,

No. 162

August 23, 2022

Part II





Department of Energy





-----------------------------------------------------------------------





10 CFR Part 430





Energy Conservation Program: Energy Conservation Standards for Consumer 
Clothes Dryers; Proposed Rule

Federal Register / Vol. 87 , No. 162 / Tuesday, August 23, 2022 / 
Proposed Rules

[[Page 51734]]


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DEPARTMENT OF ENERGY

10 CFR Part 430

[EERE-2014-BT-STD-0058]
RIN 1904-AD99


Energy Conservation Program: Energy Conservation Standards for 
Consumer Clothes Dryers

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

ACTION: Notice of proposed rulemaking and announcement of public 
meeting.

-----------------------------------------------------------------------

SUMMARY: The Energy Policy and Conservation Act, as amended (``EPCA''), 
prescribes energy conservation standards for various consumer products 
and certain commercial and industrial equipment, including consumer 
clothes dryers. EPCA also requires the U.S. Department of Energy 
(``DOE'') to periodically determine whether more stringent standards 
would be technologically feasible and economically justified, and would 
result in significant energy savings. In this notice of proposed 
rulemaking (``NOPR''), DOE proposes amended energy conservation 
standards for consumer clothes dryers, and also announces a public 
meeting to receive comment on these proposed standards and associated 
analyses and results.

DATES: 
    Meeting: DOE will hold a public meeting via webinar on September 
13, 2022, from 1:00 p.m. to 4:00 p.m. See section VII, ``Public 
Participation'' for webinar registration information, participant 
instructions and information about the capabilities available to 
webinar participants.
    Comments: DOE will accept comments, data, and information regarding 
this NOPR no later than October 24, 2022.
    Comments regarding the likely competitive impact of the proposed 
standard should be sent to the Department of Justice contact listed in 
the ADDRESSES section on or before September 22, 2022.

ADDRESSES: Interested persons are encouraged to submit comments using 
the Federal eRulemaking Portal at www.regulations.gov. Follow the 
instructions for submitting comments. Alternatively, interested persons 
may submit comments, identified by docket number EERE-2014-BT-STD-0058, 
by any of the following methods:
    1. Federal eRulemaking Portal: www.regulations.gov. Follow the 
instructions for submitting comments.
    2. Email: to [email protected]. Include docket 
number EERE-2014-BT-STD-0058 in the subject line of the message.
    No telefacsimiles (``faxes'') will be accepted. For detailed 
instructions on submitting comments and additional information on this 
process, see section IV of this document.
    Docket: The docket for this activity, which includes Federal 
Register notices, comments, and other supporting documents/materials, 
is available for review at www.regulations.gov. All documents in the 
docket are listed in the www.regulations.gov index. However, not all 
documents listed in the index may be publicly available, such as 
information that is exempt from public disclosure.
    The docket web page can be found at www.regulations.gov/docket/EERE-2014-BT-STD-0058. The docket web page contains instructions on how 
to access all documents, including public comments, in the docket. See 
section VII for information on how to submit comments through 
www.regulations.gov.
    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 following the instructions at www.RegInfo.gov.
    EPCA requires the Attorney General to provide DOE a written 
determination of whether the proposed standard is likely to lessen 
competition. The U.S. Department of Justice Antitrust Division invites 
input from market participants and other interested persons with views 
on the likely competitive impact of the proposed standard. Interested 
persons may contact the Division at [email protected] on or 
before the date specified in the DATES section. Please indicate in the 
``Subject'' line of your email the title and Docket Number of this 
rulemaking notice.

FOR FURTHER INFORMATION CONTACT: 
    Mr. Bryan Berringer, U.S. Department of Energy, Office of Energy 
Efficiency and Renewable Energy, Building Technologies Office, EE-5B, 
1000 Independence Avenue SW, Washington, DC 20585-0121. Email: 
[email protected].
    Ms. Kathryn McIntosh, U.S. Department of Energy, Office of the 
General Counsel, GC-33, 1000 Independence Avenue SW, Washington, DC 
20585-0121. Telephone: (202) 586-2002. Email: 
[email protected].
    For further information on how to submit a comment, review other 
public comments and the docket, or participate in the public meeting, 
contact the Appliance and Equipment Standards Program staff at (202) 
287-1445 or by email: [email protected].

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Synopsis of the Proposed Rule
    A. Benefits and Costs to Consumers
    B. Impact on Manufacturers
    C. National Benefits and Costs
    D. Conclusion
II. Introduction
    A. Authority
    B. Background
    1. Current Standards
    2. Current Process
    C. Deviation From Appendix A
III. General Discussion
    A. Product Classes and Scope of Coverage
    B. Test Procedure
    C. Technological Feasibility
    1. General
    2. Maximum Technologically Feasible Levels
    D. Energy Savings
    1. Determination of Savings
    2. Significance of Savings
    E. Economic Justification
    1. Specific Criteria
    a. Economic Impact on Manufacturers and Consumers
    b. Savings in Operating Costs Compared To Increase in Price (LCC 
and PBP)
    c. Energy Savings
    d. Lessening of Utility or Performance of Products
    e. Impact of Any Lessening of Competition
    f. Need for National Energy Conservation
    g. Other Factors
    2. Rebuttable Presumption
IV. Methodology and Discussion of Related Comments
    A. Market and Technology Assessment
    1. Scope of Coverage and Product Classes
    2. Technology Options
    B. Screening Analysis
    1. Screened-Out Technologies
    a. Thermoelectric Heating, Electric Only
    b. Microwave, Electric Only
    c. Indirect Heating
    d. RF Drying, Electric Only
    e. Ultrasonic Drying, Electric Only
    2. Remaining Technologies
    C. Engineering Analysis
    1. Efficiency Analysis
    a. Baseline Efficiency Levels
    b. Incremental Efficiency Levels
    2. Cost Analysis
    3. Cost-Efficiency Results
    D. Markups Analysis
    E. Energy Use Analysis
    F. Life-Cycle Cost and Payback Period Analysis
    1. Product Cost
    2. Installation Cost
    3. Annual Energy Consumption
    4. Energy Prices
    5. Maintenance and Repair Costs
    6. Product Lifetime
    7. Discount Rates

[[Page 51735]]

    8. Energy Efficiency Distribution in the No-New-Standards Case
    9. Payback Period Analysis
    G. Shipments Analysis
    H. National Impact Analysis
    1. Product Efficiency Trends
    2. National Energy Savings
    3. Net Present Value Analysis
    I. Consumer Subgroup Analysis
    J. Manufacturer Impact Analysis
    1. Overview
    2. Government Regulatory Impact Model and Key Inputs
    a. Manufacturer Production Costs
    b. Shipments Projections
    c. Product and Capital Conversion Costs
    d. Manufacturer Markup Scenarios
    3. Manufacturer Interviews
    a. Heat Pump Technology
    b. Preservation of Electromechanical Controls
    c. Cost Increases and Component Shortages
    4. Discussion of MIA Comments
    K. Emissions Analysis
    1. Air Quality Regulations Incorporated in DOE's Analysis
    L. Monetizing Emissions Impacts
    M. Utility Impact Analysis
    N. Employment Impact Analysis
V. Analytical Results and Conclusions
    A. Trial Standard Levels
    B. Economic Justification and Energy Savings
    1. Economic Impacts on Individual Consumers
    a. Life-Cycle Cost and Payback Period
    b. Consumer Subgroup Analysis
    c. Rebuttable Presumption Payback
    2. Economic Impacts on Manufacturers
    a. Industry Cash Flow Analysis Results
    b. Direct Impacts on Employment
    c. Impacts on Manufacturing Capacity
    d. Impacts on Subgroups of Manufacturers
    e. Cumulative Regulatory Burden
    3. National Impact Analysis
    a. Significance of Energy Savings
    b. Net Present Value of Consumer Costs and Benefits
    c. Indirect Impacts on Employment
    4. Impact on Utility or Performance of Products
    5. Impact of Any Lessening of Competition
    6. Need of the Nation To Conserve Energy
    7. Other Factors
    8. Summary of Economic Impacts
    C. Conclusion
    1. Benefits and Burdens of TSLs Considered for Consumer Clothes 
Dryers Standards
    2. Annualized Benefits and Costs of the Proposed Standards
    D. Reporting, Certification, and Sampling Plan
VI. Procedural Issues and Regulatory Review
    A. Review Under Executive Orders 12866 and 13563
    B. Review Under the Regulatory Flexibility Act
    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. Information Quality
VII. Public Participation
    A. Participation in the Webinar
    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
VIII. Approval of the Office of the Secretary

I. Synopsis of the Proposed Rule

    Title III, Part B \1\ of EPCA,\2\ established the Energy 
Conservation Program for Consumer Products Other Than Automobiles. (42 
U.S.C. 6291-6309) These products include consumer clothes dryers, the 
subject of this proposed rulemaking.
---------------------------------------------------------------------------

    \1\ For editorial reasons, upon codification in the U.S. Code, 
Part B was redesignated Part A.
    \2\ All references to EPCA in this document refer to the statute 
as amended through the Infrastructure Investment and Jobs Act, 
Public Law 117-58 (Nov. 15, 2021).
---------------------------------------------------------------------------

    Pursuant to EPCA, any new or amended energy conservation standard 
must be designed to achieve the maximum improvement in energy 
efficiency that DOE determines is technologically feasible and 
economically justified. (42 U.S.C. 6295(o)(2)(A)) Furthermore, the new 
or amended standard must result in a significant conservation of 
energy. (42 U.S.C. 6295(o)(3)(B)) EPCA also provides that not later 
than 6 years after issuance of any final rule establishing or amending 
a standard, DOE must publish either a notice of determination that 
standards for the product do not need to be amended, or a NOPR 
including new proposed energy conservation standards (proceeding to a 
final rule, as appropriate). (42 U.S.C. 6295(m))
    In accordance with these and other statutory provisions discussed 
in this document, DOE proposes amended energy conservation standards 
for consumer clothes dryers. The proposed standards, which are 
expressed as the combined energy factor as determined in accordance 
with the appendix D2 test procedure (``CEFD2'') in pounds 
per kilowatt-hour (``lb/kWh'')--a metric based on the clothes dryer 
test load weight in pounds (``lb'') divided by the sum of ``active 
mode'' and ``inactive mode'' per-cycle energy use in kilowatt-hours 
(``kWh''), are shown in Table I.1. These proposed standards, if 
adopted, would apply to all consumer clothes dryers listed in Table I.1 
manufactured in, or imported into, the United States starting on the 
date 3 years after the publication of the final rule for this proposed 
rulemaking.

 Table I.1--Proposed Energy Conservation Standards for Consumer Clothes
                  Dryers as Measured Under Appendix D2
------------------------------------------------------------------------
                                                            CEFD2  (lb/
                      Product class                            kWh)
------------------------------------------------------------------------
1. Electric, Standard (4.4 cubic feet (``ft\3\'') or                3.93
 greater capacity)......................................
2. Electric, Compact (120 volts (``V'')) (less than 4.4             4.33
 ft\3\ capacity)........................................
3. Vented Electric, Compact (240V) (less than 4.4 ft\3\             3.57
 capacity)..............................................
4. Vented Gas, Standard (4.4 ft\3\ or greater capacity).            3.48
5. Vented Gas, Compact (less than 4.4 ft\3\ capacity)...            2.02
6. Ventless Electric, Compact (240V) (less than 4.4                 2.68
 ft\3\ capacity)........................................
7. Ventless Electric, Combination Washer-Dryer..........            2.33
------------------------------------------------------------------------


[[Page 51736]]

    DOE also considered more-stringent energy efficiency levels as 
potential standards, and is still considering them in this proposed 
rulemaking. DOE may also consider adopting more stringent-energy 
efficiency levels for some or all classes. However, DOE has tentatively 
concluded at this time that the potential burdens of the more-stringent 
energy efficiency levels would outweigh the projected benefits.

A. Benefits and Costs to Consumers

    Table I.2 presents DOE's evaluation of the economic impacts of the 
proposed standards on consumers of consumer clothes dryers, as measured 
by the average life-cycle cost (``LCC'') savings and the simple payback 
period (``PBP'').\3\ The average LCC savings are positive for all 
product classes, and the PBP is less than the average lifetime of 
consumer clothes dryers, which is estimated to be 14 years (see section 
IV.F of this document).
---------------------------------------------------------------------------

    \3\ The average LCC savings refer to consumers that are affected 
by a standard and are measured relative to the efficiency 
distribution in the no-new-standards case, which depicts the market 
in the compliance year in the absence of new or amended standards 
(see section IV.F.8 of this document). The simple PBP, which is 
designed to compare specific efficiency levels, is measured relative 
to the baseline product (see section IV.F.9 of this document).

     Table I.2--Impacts of Proposed Energy Conservation Standards on
                  Consumers of Consumer Clothes Dryers
------------------------------------------------------------------------
                                         Average LCC     Simple payback
    Consumer clothes dryer class       savings (2020$)   period (years)
------------------------------------------------------------------------
Electric, Standard (4.4 ft\3\ or                  $578              0.55
 greater capacity)..................
Electric, Compact (120V) (less than                160              1.81
 4.4 ft\3\ capacity)................
Vented Electric, Compact (240V)                    192              1.62
 (less than 4.4 ft\3\ capacity).....
Vented Gas, Standard (4.4 ft\3\ or                 198              1.95
 greater capacity)..................
Vented Gas, Compact (less than 4.4                25.2              5.07
 ft\3\ capacity)....................
Ventless Electric, Compact (240V)                  145              0.33
 (less than 4.4 ft\3\ capacity).....
Ventless Electric, Combination                    15.1              0.00
 Washer-Dryer.......................
------------------------------------------------------------------------

    DOE's analysis of the impacts of the proposed standards on 
consumers is described in section IV.F of this document.

B. Impact on Manufacturers

    The industry net present value (``INPV'') is the sum of the 
discounted cash flows to the industry from the base year through the 
end of the analysis period (2022-2056). Using a real discount rate of 
7.5 percent, DOE estimates that the INPV for manufacturers of consumer 
clothes dryers in the case without amended standards is $1,810.1 
million in 2020$. Under the proposed standards, the change in INPV is 
estimated to range from -6.4 percent to -4.5 percent, which is 
approximately $115.6 million to $81.6 million. In order to bring 
products into compliance with amended standards, it is estimated that 
the industry would incur total conversion costs of $149.7 million.
    DOE's analysis of the impacts of the proposed standards on 
manufacturers is described in section IV.J of this document. The 
analytic results of the manufacturer impact analysis (``MIA'') are 
presented in section V.B.2 of this document.

C. National Benefits and Costs 4
---------------------------------------------------------------------------

    \4\ All monetary values in this document are expressed in 2020 
dollars.
---------------------------------------------------------------------------

    DOE's analyses indicate that the proposed energy conservation 
standards for consumer clothes dryers would save a significant amount 
of energy. Relative to the case without amended standards, the lifetime 
energy savings for consumer clothes dryers purchased in the 30-year 
period that begins in the anticipated year of compliance with the 
amended standards (2027-2056) amount to 3.11 quadrillion British 
thermal units (``Btu''), or quads.\5\
---------------------------------------------------------------------------

    \5\ The quantity refers to full-fuel-cycle (``FFC'') energy 
savings. FFC energy savings includes the energy consumed in 
extracting, processing, and transporting primary fuels (i.e., coal, 
natural gas, petroleum fuels), and, thus, presents a more complete 
picture of the impacts of energy efficiency standards. For more 
information on the FFC metric, see section IV.H.2 of this document.
---------------------------------------------------------------------------

    The cumulative net present value (``NPV'') of total consumer 
benefits of the proposed standards for consumer clothes dryers ranges 
from $9.07 billion (at a 7-percent discount rate) to $20.8 billion (at 
a 3-percent discount rate). This NPV expresses the estimated total 
value of future operating-cost savings minus the estimated increased 
product costs for consumer clothes dryers purchased in 2027-2056.
    In addition, the proposed standards for consumer clothes dryers are 
projected to yield significant environmental benefits. DOE estimates 
that the proposed standards would result in cumulative emission 
reductions (over the same period as for energy savings) of 116 million 
metric tons (``Mt'') \6\ of carbon dioxide (``CO2''), 42.6 
thousand tons of sulfur dioxide (``SO2''), 181 thousand tons 
of nitrogen oxides (``NOX''), 883 thousand tons of methane 
(``CH4''), 1.09 thousand tons of nitrous oxide 
(``N2O''), and 0.26 tons of mercury (``Hg'').\7\
---------------------------------------------------------------------------

    \6\ A metric ton is equivalent to 1.1 short tons. Results for 
emissions other than CO2 are presented in short tons.
    \7\ DOE calculated emissions reductions relative to the no-new-
standards case, which reflects key assumptions in the Annual Energy 
Outlook 2021 (``AEO2021''). AEO2021 represents current Federal and 
State legislation and final implementation of regulations as of the 
time of its preparation. See section IV.K of this document for 
further discussion of AEO2021 assumptions that effect air pollutant 
emissions.
---------------------------------------------------------------------------

    DOE estimates the value of climate benefits from a reduction in 
greenhouse gases using four different estimates of the social cost of 
CO2 (``SC-CO2''), the social cost of methane 
(``SC-CH4''), and the social cost of nitrous oxide (``SC-
N2O''). Together these represent the social cost of 
greenhouse gases (SC-GHG). DOE used interim SC-GHG values developed by 
an Interagency Working Group on the Social Cost of Greenhouse Gases 
(``IWG'').\8\ The derivation of these values is discussed in section 
IV.L of this document. For presentational purposes, the climate 
benefits associated with the average SC-GHG at a 3-percent discount 
rate are estimated to be $5.42 billion. DOE does not have a single 
central SC-GHG point estimate and it emphasizes the

[[Page 51737]]

importance and value of considering the benefits calculated using all 
four SC-GHG estimates.\9\
---------------------------------------------------------------------------

    \8\ See Interagency Working Group on Social Cost of Greenhouse 
Gases, Technical Support Document: Social Cost of Carbon, Methane, 
and Nitrous Oxide. Interim Estimates Under Executive Order 13990, 
Washington, DC (February 2021) (Available at: www.whitehouse.gov/wp-content/uploads/2021/02/TechnicalSupportDocument_SocialCostofCarbonMethaneNitrousOxide.pdf) 
(Last accessed March 17, 2022).
    \9\ On March 16, 2022, the Fifth Circuit Court of Appeals (No. 
22-30087) granted the Federal government's emergency motion for stay 
pending appeal of the February 11, 2022, preliminary injunction 
issued in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a 
result of the Fifth Circuit's order, the preliminary injunction is 
no longer in effect, pending resolution of the Federal government's 
appeal of that injunction or a further court order. Among other 
things, the preliminary injunction enjoined the defendants in that 
case from ``adopting, employing, treating as binding, or relying 
upon'' the interim estimates of the social cost of greenhouse 
gases--which were issued by the Interagency Working Group on the 
Social Cost of Greenhouse Gases on February 26, 2021--to monetize 
the benefits of reducing greenhouse gas emissions. As reflected in 
this rule, DOE has reverted to its approach prior to the injunction 
and presents monetized greenhouse gas abatement benefits where 
appropriate and permissible under law.
---------------------------------------------------------------------------

    DOE also estimates health benefits from SO2 and 
NOX emissions reductions. DOE estimates the present value of 
the health benefits would be $3.59 billion using a 7-percent discount 
rate, and $9.14 billion using a 3-percent discount rate. DOE is 
currently only monetizing (for SO2 and NOX) 
PM2.5 precursor health benefits and (for NOX) 
ozone precursor health benefits but will continue to assess the ability 
to monetize other effects such as health benefits from reductions in 
direct PM2.5 emissions.
    Table I.3 summarizes the monetized benefits and costs expected to 
result from the proposed standards for consumer clothes dryers. There 
are other important unquantified effects, including certain 
unquantified climate benefits, unquantified public health benefits from 
the reduction of toxic air pollutants and other emissions, unquantified 
energy security benefits, and distributional effects, among others.

 Table I.3--Summary of Monetized Economic Benefits and Costs of Proposed
        Energy Conservation Standards for Consumer Clothes Dryers
                                 [TSL 3]
------------------------------------------------------------------------
                                                          Billion 2020$
------------------------------------------------------------------------
                            3% discount rate
------------------------------------------------------------------------
Consumer Operating Cost Savings.......................              22.2
Climate Benefits *....................................              5.42
Health Benefits **....................................              9.14
Total Benefits [dagger]...............................              36.8
Consumer Incremental Product Costs [Dagger]...........              1.36
Net Benefits..........................................              35.4
------------------------------------------------------------------------
                            7% discount rate
------------------------------------------------------------------------
Consumer Operating Cost Savings.......................              9.83
Climate Benefits *....................................              5.42
Health Benefits **....................................              3.59
Total Benefits [dagger]...............................              18.8
Consumer Incremental Product Costs [Dagger]...........              0.76
Net Benefits..........................................              18.1
------------------------------------------------------------------------
Note: This table presents the costs and benefits associated with
  consumer clothes dryers shipped in 2027-2056. These results include
  benefits to consumers which accrue after 2056 from the products
  shipped in 2027-2056.
* Climate benefits are calculated using four different estimates of the
  social cost of carbon (SC-CO2), methane (SC-CH4), and nitrous oxide
  (SC-N2O) (model average at 2.5 percent, 3 percent, and 5 percent
  discount rates; 95th percentile at 3 percent discount rate), as shown
  in Table V.36, Table V.38, and Table V.40. Together these represent
  the global social cost of greenhouse gases (SC-GHG). For
  presentational purposes of this table, the climate benefits associated
  with the average SC-GHG at a 3 percent discount rate are shown, but
  the Department does not have a single central SC-GHG point estimate.
  See section. IV.L of this document for more details. On March 16,
  2022, the Fifth Circuit Court of Appeals (No. 22-30087) granted the
  Federal government's emergency motion for stay pending appeal of the
  February 11, 2022, preliminary injunction issued in Louisiana v.
  Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a result of the Fifth
  Circuit's order, the preliminary injunction is no longer in effect,
  pending resolution of the Federal government's appeal of that
  injunction or a further court order. Among other things, the
  preliminary injunction enjoined the defendants in that case from
  ``adopting, employing, treating as binding, or relying upon'' the
  interim estimates of the social cost of greenhouse gases--which were
  issued by the Interagency Working Group on the Social Cost of
  Greenhouse Gases on February 26, 2021--to monetize the benefits of
  reducing greenhouse gas emissions. As reflected in this rule, DOE has
  reverted to its approach prior to the injunction and presents
  monetized greenhouse gas abatement benefits where appropriate and
  permissible under law.
** Health benefits are calculated using benefit-per-ton values for NOX
  and SO2. DOE is currently only monetizing (for SO2 and NOX) PM2.5
  precursor health benefits and (for NOX) ozone precursor health
  benefits, but will continue to assess the ability to monetize other
  effects such as health benefits from reductions in direct PM2.5
  emissions. The health benefits are presented at real discount rates of
  3 and 7 percent. See section IV.L of this document for more details.
[dagger] Total and net benefits include those consumer, climate, and
  health benefits that can be monetized. For presentation purposes,
  total and net benefits for both the 3-percent and 7-percent cases are
  presented using the average SC-GHG with 3-percent discount rate, but
  the Department does not have a single central SC-GHG point estimate.
  DOE emphasizes the importance and value of considering the benefits
  calculated using all four SC-GHG estimates. See Table V.46 for net
  benefits using all four SC-GHG estimates.
[Dagger] Costs include incremental equipment costs as well as
  installation costs.

    The benefits and costs of the proposed standards, for consumer 
clothes dryers sold in 2027-2056, can also be expressed in terms of 
annualized values. The monetary values for the total annualized net 
benefits are (1) the reduced consumer operating costs, minus (2) the 
increase in product purchase prices and installation costs, plus (3) 
the value of the benefits of NOX and SO2 emission 
reductions, all annualized.\10\
---------------------------------------------------------------------------

    \10\ To convert the time-series of costs and benefits into 
annualized values, DOE calculated a present value in 2021, the year 
used for discounting the NPV of total consumer costs and savings. 
For the benefits, DOE calculated a present value associated with 
each year's shipments in the year in which the shipments occur 
(e.g., 2030), and then discounted the present value from each year 
to 2021. The calculation uses discount rates of 3 and 7 percent for 
all costs and benefits. Using the present value, DOE then calculated 
the fixed annual payment over a 30-year period, starting in the 
compliance year, that yields the same present value.

---------------------------------------------------------------------------

[[Page 51738]]

    The national operating savings are domestic private U.S. consumer 
monetary savings that occur as a result of purchasing the covered 
products and are measured for the lifetime of consumer clothes dryers 
shipped in 2027-2056. The benefits associated with reduced emissions 
achieved as a result of the proposed standards are also calculated 
based on the lifetime of consumer clothes dryers shipped in 2027-2056. 
Total benefits for both the 3-percent and 7-percent cases are presented 
using the average GHG social costs with 3-percent discount rate. 
Estimates of SC-GHG values are presented for all four discount rates in 
section V.B.8 of this document. Estimates of annualized benefits and 
costs of the proposed standards are shown in Table I.4. The results 
under the primary estimate are as follows.
    Using a 7-percent discount rate for consumer benefits and costs and 
health benefits from reduced SO2 and NOX 
emissions, the estimated cost of the standards proposed in this rule is 
$85.7 million per year in increased equipment costs, while the 
estimated annual benefits are $1,111 million in reduced equipment 
operating costs, $320 million in climate benefits, and $406 million in 
health benefits (accounting for reduced NOX emissions and 
increased SO2 emissions). In this case, the net benefit 
would amount to $1,752 million per year.
    Using a 3-percent discount rate for all benefits and costs, the 
estimated cost of the proposed standards is $80.7 million per year in 
increased equipment costs, while the estimated annual benefits are 
$1,313 million in reduced operating costs, $320 million in climate 
benefits, and $541 million in health benefits (accounting for reduced 
NOX emissions and increased SO2 emissions). In 
this case, the net benefit would amount to $2,094 million per year.

    Table I.4--Annualized Monetized Benefits and Costs of Proposed Energy Conservation Standards for Consumer
                                                 Clothes Dryers
                                                     [TSL 3]
----------------------------------------------------------------------------------------------------------------
                                                                                Million 2020$/year
                                                                 -----------------------------------------------
                                                                                     Low-net-        High-net-
                                                                      Primary        benefits        benefits
                                                                     estimate        estimate        estimate
----------------------------------------------------------------------------------------------------------------
                                                3% discount rate
----------------------------------------------------------------------------------------------------------------
Consumer Operating Cost Savings.................................           1,313           1,227           1,403
Climate Benefits *..............................................             320             311             327
Health Benefits **..............................................             541             526             551
Total Benefits [dagger].........................................           2,174           2,065           2,280
Consumer Incremental Product Costs [Dagger].....................            80.7            80.5            76.6
Net Benefits....................................................           2,094           1,984           2,204
----------------------------------------------------------------------------------------------------------------
                                                7% discount rate
----------------------------------------------------------------------------------------------------------------
Consumer Operating Cost Savings.................................           1,111           1,050           1,178
Climate Benefits *..............................................             320             311             327
Health Benefits **..............................................             406             395             413
Total Benefits [dagger].........................................           1,837           1,757           1,917
Consumer Incremental Product Costs [Dagger].....................            85.7            85.3            82.4
Net Benefits....................................................           1,752           1,671           1,835
----------------------------------------------------------------------------------------------------------------
Note: This table presents the costs and benefits associated with consumer clothes dryers shipped in 2027-2056.
  These results include benefits to consumers which accrue after 2056 from the products shipped in 2027-2056.
* Climate benefits are calculated using four different estimates of the global SC-GHG (see section IV.L of this
  document). For presentational purposes of this table, the climate benefits associated with the average SC-GHG
  at a 3 percent discount rate are shown, but the Department does not have a single central SC-GHG point
  estimate, and it emphasizes the importance and value of considering the benefits calculated using all four SC-
  GHG estimates. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22-30087) granted the federal
  government's emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued
  in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a result of the Fifth Circuit's order, the
  preliminary injunction is no longer in effect, pending resolution of the federal government's appeal of that
  injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in
  that case from ``adopting, employing, treating as binding, or relying upon'' the interim estimates of the
  social cost of greenhouse gases--which were issued by the Interagency Working Group on the Social Cost of
  Greenhouse Gases on February 26, 2021--to monetize the benefits of reducing greenhouse gas emissions. As
  reflected in this rule, DOE has reverted to its approach prior to the injunction and presents monetized
  greenhouse gas abatement benefits where appropriate and permissible under law.
** Health benefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only monetizing
  (for SO2 and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits, but will
  continue to assess the ability to monetize other effects such as health benefits from reductions in direct
  PM2.5 emissions. The health benefits are presented at real discount rates of 3 and 7 percent. See section IV.L
  of this document for more details.
[dagger] Total benefits for both the 3-percent and 7-percent cases are presented using the average SC-GHG with 3-
  percent discount rate, but the Department does not have a single central SC-GHG point estimate. DOE emphasizes
  the importance and value of considering the benefits calculated using all four SC-GHG estimates.
[Dagger] Costs include incremental equipment costs as well as installation costs.

    DOE's analysis of the national impacts of the proposed standards is 
described in sections IV.H, IV.K and IV.L of this document.

D. Conclusion

    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 the 
significant conservation of energy. Specifically, with regards to 
technological feasibility, products achieving these standard levels are 
already commercially available for all product classes covered by this 
proposal. As for economic justification,

[[Page 51739]]

DOE's analysis shows that the benefits of the proposed standard exceed, 
to a great extent, the burdens of the proposed standards. Using a 7-
percent discount rate for consumer benefits and costs and 
NOX and SO2 reduction benefits, the estimated 
cost of the proposed standards for consumer clothes dryers is $85.7 
million per year in increased product costs, while the estimated annual 
benefits are $1,111 million in reduced product operating costs, and 
$406 million in health benefits. The net benefit amounts to $1,752 
million per year.
    The significance of energy savings offered by a new or amended 
energy conservation standard cannot be determined without knowledge of 
the specific circumstances surrounding a given rulemaking.\11\ For 
example, some covered products and equipment have substantial energy 
consumption occur during periods of peak energy demand. The impacts of 
these products on the energy infrastructure can be more pronounced than 
products with relatively constant demand. In evaluating the 
significance of energy savings, DOE considers differences in primary 
energy and FFC effects for different covered products and equipment 
when determining whether energy savings are significant. Primary energy 
and FFC effects include the energy consumed in electricity production 
(depending on load shape), in distribution and transmission, and in 
extracting, processing, and transporting primary fuels (i.e., coal, 
natural gas, petroleum fuels), and thus present a more complete picture 
of the impacts of energy conservation standards. Accordingly, DOE 
evaluates the significance of energy savings on a case-by-case basis.
---------------------------------------------------------------------------

    \11\ Procedures, Interpretations, and Policies for Consideration 
in New or Revised Energy Conservation Standards and Test Procedures 
for Consumer Products and Commercial/Industrial Equipment, 86 FR 
70892, 70901 (Dec. 13, 2021).
---------------------------------------------------------------------------

    As previously mentioned, the standards are projected to result in 
estimated national energy savings of 3.11 quads, the equivalent of the 
electricity consumption of 78 million residential homes in one 
year.\12\ DOE has initially determined the energy savings from the 
proposed standard levels are ``significant'' within the meaning of 42 
U.S.C. 6295(o)(3)(B). A more detailed discussion of the basis for these 
tentative conclusions is contained in the remainder of this document 
and the accompanying technical support document (``TSD'').
---------------------------------------------------------------------------

    \12\ U.S. Environmental Protection Agency, Greenhouse Gas 
Equivalencies Calculator. Available at www.epa.gov/energy/greenhouse-gas-equivalencies-calculator.
---------------------------------------------------------------------------

    DOE also considered more-stringent energy efficiency levels as 
potential standards, and is still considering them in this proposed 
rulemaking. However, DOE has tentatively concluded that the potential 
burdens of the more-stringent energy efficiency levels would outweigh 
the projected benefits.
    Based on consideration of the public comments DOE receives in 
response to this document and related information collected and 
analyzed during the course of this rulemaking effort, DOE may adopt 
energy efficiency levels presented in this document 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 proposed rule, as well as some of the relevant 
historical background related to the establishment of standards for 
consumer clothes dryers.

A. Authority

    EPCA authorizes DOE to regulate the energy efficiency of a number 
of consumer products and certain industrial equipment. Title III, Part 
B of EPCA established the Energy Conservation Program for Consumer 
Products Other Than Automobiles. These products include consumer 
clothes dryers, the subject of this document. (42 U.S.C. 6292(a)(8)) 
EPCA prescribed energy conservation standards for these products (42 
U.S.C. 6295(g)(3)), and directs DOE to conduct future rulemakings to 
determine whether to amend these standards. (42 U.S.C. 6295(g)(4)) EPCA 
further provides that, not later than 6 years after the issuance of any 
final rule establishing or amending a standard, DOE must publish either 
a notice of determination that standards for the product do not need to 
be amended, or a NOPR including new proposed energy conservation 
standards (proceeding to a final rule, as appropriate). (42 U.S.C. 
6295(m)(1)).
    The energy conservation program under EPCA consists essentially of 
four parts: (1) testing, (2) labeling, (3) the establishment of Federal 
energy conservation standards, and (4) certification and enforcement 
procedures. Relevant provisions of EPCA specifically include 
definitions (42 U.S.C. 6291), test procedures (42 U.S.C. 6293), 
labeling provisions (42 U.S.C. 6294), energy conservation standards (42 
U.S.C. 6295), and the authority to require information and reports from 
manufacturers (42 U.S.C. 6296).
    Federal energy efficiency requirements for covered products 
established under EPCA generally supersede State laws and regulations 
concerning energy conservation testing, labeling, and standards. (42 
U.S.C. 6297(a)-(c)) 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 EPCA. (See 42 
U.S.C. 6297(d)).
    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 covered product. (42 U.S.C. 
6295(o)(3)(A) and 42 U.S.C. 6295(r)) Manufacturers of covered products 
must use the prescribed DOE test procedure as the basis for certifying 
to DOE that their products comply with the applicable energy 
conservation standards adopted under EPCA and when making 
representations to the public regarding the energy use or efficiency of 
those products. (42 U.S.C. 6293(c) and 42 U.S.C. 6295(s)) Similarly, 
DOE must use these test procedures to determine whether the products 
comply with standards adopted pursuant to EPCA. (42 U.S.C. 6295(s)) The 
DOE test procedures for consumer clothes dryers appear at title 10 of 
the Code of Federal Regulations (``CFR'') part 430, subpart B, appendix 
D1 and appendix D2 (``appendix D1'' and ``appendix D2'', respectively).
    DOE must follow specific statutory criteria for prescribing new or 
amended standards for covered products, including consumer clothes 
dryers. Any new or amended standard for a covered product must be 
designed to achieve the maximum improvement in energy efficiency that 
the Secretary of Energy determines is technologically feasible and 
economically justified. (42 U.S.C. 6295(o)(2)(A) and 42 U.S.C. 
6295(o)(3)(B)) Furthermore, DOE may not adopt any standard that would 
not result in the significant conservation of energy. (42 U.S.C. 
6295(o)(3) (B))
    Moreover, DOE may not prescribe a standard if DOE determines by 
rule that the standard is not technologically feasible or economically 
justified. (42 U.S.C. 6295(o)(3)(B)) 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)) DOE must make this determination after receiving 
comments

[[Page 51740]]

on the proposed standard, and by considering, to the greatest extent 
practicable, the following seven statutory factors:

    (1) The economic impact of the standard on manufacturers and 
consumers of the products subject to the standard;
    (2) The savings in operating costs throughout the estimated 
average life of the covered products in the type (or class) compared 
to any increase in the price, initial charges, or maintenance 
expenses for the covered products that are likely to result from the 
standard;
    (3) The total projected amount of energy (or as applicable, 
water) savings likely to result directly from the standard;
    (4) Any lessening of the utility or the performance of the 
covered products likely to result from the standard;
    (5) The impact of any lessening of competition, as determined in 
writing by the Attorney General, that is likely to result from the 
standard;
    (6) The need for national energy 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))

    Further, EPCA establishes a rebuttable presumption that a standard 
is economically justified if the Secretary finds that the additional 
cost to the consumer of purchasing a product complying with an energy 
conservation standard level will be less than three times the value of 
the energy savings during the first year that the consumer will receive 
as a result of the standard, as calculated under the applicable test 
procedure. (42 U.S.C. 6295(o)(2)(B)(iii))
    EPCA also contains what is known as an ``anti-backsliding'' 
provision, which prevents the Secretary from prescribing any amended 
standard that either increases the maximum allowable energy use or 
decreases the minimum required energy efficiency of a covered product. 
(42 U.S.C. 6295(o)(1)) Also, the Secretary may not prescribe an amended 
or new standard if interested persons have established by a 
preponderance of the evidence that the standard is likely to result in 
the unavailability in the United States in 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))
    Additionally, EPCA specifies requirements when promulgating an 
energy conservation standard for a covered product that has two or more 
product classes. DOE must specify a different standard level for a type 
or class of product 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 products within such 
type (or class); or (B) have a capacity or other performance-related 
feature which other products within such type (or class) do not have 
and such feature justifies a higher or lower standard. (42 U.S.C. 
6295(q)(1)) In determining whether a performance-related feature 
justifies a different standard for a group of products, 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))
    Finally, pursuant to the amendments contained in the Energy 
Independence and Security Act of 2007 (``EISA 2007''), Public Law 110-
140, any final rule for new or amended energy conservation standards 
promulgated after July 1, 2010, is required to address standby mode and 
off mode energy use. (42 U.S.C. 6295(gg)(3)) Specifically, when DOE 
adopts a standard for a covered product after that date, it must, if 
justified by the criteria for adoption of standards under EPCA (42 
U.S.C. 6295(o)), incorporate standby mode and off mode energy use into 
a single standard, or, if that is not feasible, adopt a separate 
standard for such energy use for that product. (42 U.S.C. 
6295(gg)(3)(A)-(B)) DOE's current test procedures for consumer clothes 
dryers address standby mode and off mode energy use. In this 
rulemaking, DOE intends to incorporate such energy use into any amended 
energy conservation standards that it may adopt.

B. Background

1. Current Standards
    The most recent standards rulemaking for consumer clothes dryers 
was promulgated on April 21, 2011. Specifically, DOE published a direct 
final rule (the ``2011 Direct Final Rule'') amending the energy 
conservation standard for consumer clothes dryers manufactured on and 
after January 1, 2015. 76 FR 22454 (Apr. 21, 2011). The energy 
conservation standards, as amended in the 2011 Direct Final Rule, 
represent the current standards and are in accordance with the appendix 
D1 test procedure as discussed in section III.B of this document. They 
are based on combined energy factor (``CEF'')--a metric that 
incorporates energy use in active mode, standby mode, and off mode. 
Compliance with the current standards was required as of January 1, 
2015. 76 FR 52852 (Aug. 24, 2011).
    Even though DOE maintained the same energy-efficiency descriptor 
for both appendix D1 and appendix D2, DOE notes that the CEF values are 
not equivalent because of the extensive differences in test methods. To 
avoid potential confusion that would result from using the same 
efficiency descriptor for both test procedures as it relates to the 
standards discussed in this document, DOE is including a ``D1'' or 
``D2'' subscript when referring to the appendix D1 CEF and appendix D2 
CEF, respectively (i.e., CEFD1 and CEFD2), in 
this document.\13\
---------------------------------------------------------------------------

    \13\ Note that while the current standards are based on CEF as 
determined in accordance with appendix D1, manufacturers are 
permitted to use the appendix D2 test procedure to comply with the 
current standards, as long as they use a single appendix for all 
representations.
---------------------------------------------------------------------------

    These current consumer clothes dryer standards as measured under 
appendix D1 are set forth in DOE's regulations at 10 CFR 430.32(h) and 
are repeated in Table II.1. DOE has conducted the rulemaking analysis 
for this proposed rule under the appendix D2 test procedure because 
compliance will be required concurrent with amended energy 
conservation, if finalized. DOE discusses additional details about the 
engineering baseline in section IV.C.1 of this document.

[[Page 51741]]



 Table II.1--Federal Energy Conservation Standards for Consumer Clothes
                  Dryers as Measured Under Appendix D1
------------------------------------------------------------------------
                                                            CEFD1 (lbs/
                      Product class                            kWh)
------------------------------------------------------------------------
(A) Vented Electric, Standard (4.4 ft \3\ or greater                3.73
 capacity)..............................................
(B) Vented Electric, Compact (120V) (less than 4.4 ft               3.61
 \3\ capacity)..........................................
(C) Vented Electric, Compact (240V) (less than 4.4 ft               3.27
 \3\ capacity)..........................................
(D) Vented Gas..........................................            3.30
(E) Ventless Electric, Compact (240V) (less than 4.4 ft             2.55
 \3\ capacity)..........................................
(F) Ventless Electric, Combination Washer-Dryer.........            2.08
------------------------------------------------------------------------

    On December 16, 2020, DOE published a final rule establishing a 
separate product class for consumer clothes dryers that offer cycle 
times for a ``normal'' cycle \14\ of less than 30 minutes. 85 FR 81359 
(Dec. 16, 2020) (``December 2020 Final Rule''). Because no such 
``short-cycle'' consumer clothes dryers are currently on the market in 
the United States, DOE did not include analysis of this newly 
established product class in the preliminary TSD.
---------------------------------------------------------------------------

    \14\ Section 3.3.2 of appendix D2 requires that the ``normal'' 
program shall be selected for the test cycle; for clothes dryers 
that do not have a ``normal'' program, the cycle recommended by the 
manufacturer for drying cotton or linen clothes shall be selected.
---------------------------------------------------------------------------

    While these short-cycle products had previously been subject to 
energy and water conservation standards, the December 2020 Final Rule 
stated that short-cycle product classes were no longer subject to any 
water or energy conservation standards. 85 FR 68723, 68742; 85 FR 
81359, 81376. As a result, the short-cycle products were allowed to 
consume unlimited amounts of energy and water.
    As discussed in a NOPR subsequently published on August 11, 2021, 
DOE noted that in amending the standards for short-cycle products to 
allow for unlimited water and energy usage, DOE failed to consider 
whether the amended standards met the criteria in EPCA for issuing an 
amended standard. Notably, among other things, DOE did not determine, 
as required, that the amended standards for short-cycle products were 
designed to achieve the maximum improvement in energy efficiency that 
is technologically feasible and economically justified. (42 U.S.C. 
6295(o)(2)(A)) 86 FR 43970, 43971. DOE has since published a final rule 
on January 19, 2022, which revoked the December 2020 Final Rule that 
improperly promulgated standards for this new product class and 
reinstated the prior product classes and applicable standards for these 
covered products. 87 FR 2673, 2686. Therefore, DOE did not include 
analysis of a short-cycle product class in the NOPR TSD.
2. Current Process
    DOE published a request for information (``RFI'') on March 27, 2015 
(the ``March 2015 RFI'') describing the approaches and methods DOE will 
use in evaluating potential amended standards for consumer clothes 
dryers. 80 FR 16309 (Mar. 27, 2015). In addition, the RFI solicited 
information from the public to help DOE determine whether amended 
standards for consumer clothes dryers would result in a significant 
amount of additional energy savings, and whether those standards would 
be technologically feasible and economically justified. Id. The March 
2015 RFI is available at www.regulations.gov/document/EERE-2014-BT-STD-0058-0001.
    DOE published a notice of public webinar and availability of the 
preliminary TSD on April 19, 2021 (``April 2021 Preliminary Analysis'') 
to collect data and information to inform its decision consistent with 
its obligations under EPCA. 86 FR 20327. DOE subsequently held a public 
webinar on May 26, 2021, to discuss and receive comments on the 
preliminary TSD. The preliminary TSD that presented the methodology and 
results of the preliminary analysis is available at: 
www.regulations.gov/document/EERE-2014-BT-STD-0058-0020.
    DOE received comments in response to the April 2021 Preliminary 
Analysis from the interested parties listed in Table II.2.

      Table II.2--April 2021 Preliminary Analysis Written Comments
------------------------------------------------------------------------
          Commenter(s)               Abbreviation       Commenter type
------------------------------------------------------------------------
Association of Home Appliance     AHAM..............  Trade Association.
 Manufacturers.
Appliance Standards Awareness     ASAP, NRDC........  Efficiency
 Project, Natural Resources                            Organizations.
 Defense Council.
California Investor-Owned         California IOUs...  Utilities.
 Utilities.
GE Appliances, a Haier Company..  GEA...............  Manufacturer.
Whirlpool Corporation...........  Whirlpool.........  Manufacturer.
Samsung Electronics America.....  Samsung...........  Manufacturer.
Northwest Energy Efficiency       NEEA..............  Efficiency
 Alliance.                                             Organization.
Institute for Policy Integrity    IPI...............  Efficiency
 at NYU School of Law.                                 Organization.
------------------------------------------------------------------------

    A parenthetical reference at the end of a comment quotation or 
paraphrase provides the location of the item in the public record.\15\
---------------------------------------------------------------------------

    \15\ The parenthetical reference provides a reference for 
information located in the docket of DOE's rulemaking to develop 
energy conservation standards for consumer clothes dryers. (Docket 
No. EERE-2014-BT-STD-0058, which is maintained at 
www.regulations.gov). The references are arranged as follows: 
(commenter name, comment docket ID number, page of that document).
---------------------------------------------------------------------------

    In response to the preliminary analysis, AHAM and Whirlpool stated 
that as laundry products are designed and used in pairs, DOE should 
harmonize its rulemaking processes such that the compliance dates for 
residential clothes washers and consumer clothes dryers are, if not 
identical, very close in time. According to AHAM and Whirlpool, this 
would

[[Page 51742]]

greatly reduce burden on manufacturers as they work to design products 
to meet amended standards as well as on retailers and consumers as 
products are re-floored leading up to and on the compliance date of any 
amended energy conservation standards. (AHAM, No. 23 at p. 6; 
Whirlpool, No. 27 at p. 13)
    DOE appreciates the comments from AHAM and Whirlpool and recognizes 
the benefits of aligning the schedule for future amended standards for 
both products and may investigate harmonization of future rulemaking 
processes.
    Additionally, AHAM stated its strong opposition to Natural 
Resources Canada's (``NRCan'') proposal to make ENERGY STAR levels the 
minimum energy conservation standard for clothes dryers in Canada and 
strongly urged DOE to not only weigh in against NRCan's approach 
through the U.S.-Canada Regulatory Cooperation Council and under the 
recently signed Memorandum of Understanding on energy cooperation, but 
also to account for the burden of any misalignment in DOE's analysis. 
According to AHAM it is critical that amended standards are coordinated 
in both substance and timing in order to maintain a consistent U.S.-
Canadian market for home appliances. (AHAM, No. 23 at p. 9)
    DOE notes that review of efficiency standards efforts in other 
regions is discussed in chapter 3 of the NOPR TSD. DOE will continue to 
review and track these efforts as part of its analysis.

C. Deviation From Appendix A

    Section 3(a) of 10 CFR part 430, subpart C, appendix A (``appendix 
A'') specifies that, in those instances where the Department may find 
it necessary or appropriate to deviate from the procedures, 
interpretations or policies that are generally applicable to the 
development of energy conservation standards and test procedures, DOE 
will provide interested parties with notice of the deviation and an 
explanation. DOE finds that it is appropriate to deviate from its 
existing procedures by publishing this NOPR instead of releasing an 
additional framework document because such activity would be redundant 
due to the information previously obtained through the March 2015 RFI 
and the preliminary analysis. Additionally, DOE finds it necessary to 
deviate from its existing procedures by providing a 60-day comment 
period for this NOPR because interested parties received sufficient 
time to comment on earlier rulemaking documents that relied on many of 
the same analytical assumptions and approaches presented in this 
proposal.
    In accordance with section 3(a) of appendix A, DOE notes that it is 
deviating from the provision in appendix A regarding the pre-NOPR 
stages for an energy conservation standards rulemaking. Section 6(a)(2) 
of appendix A states that if the Department determines it is 
appropriate to proceed with a rulemaking, the preliminary stages of a 
rulemaking to issue or amend an energy conservation standard that DOE 
will undertake will be a framework document and preliminary analysis, 
or an advance notice of proposed rulemaking. DOE is opting to deviate 
from this step by publishing a NOPR following the preliminary analysis 
without a framework document. A framework document is intended to 
introduce and summarize the various analyses DOE conducts during the 
rulemaking process and requests initial feedback from interested 
parties. As discussed, prior to the preliminary analysis and this NOPR, 
DOE published the March 2015 RFI, in which DOE identified and sought 
comment on the technical and economic analyses to be conducted in 
determining whether amended energy conservation standards would be 
justified. See 80 FR 16309. DOE provided a 45-day comment period for 
the RFI. Id. Comments received following publication of the March 2015 
RFI assisted DOE in identifying and resolving issues related to the 
preliminary analyses. 86 FR 20327, 20330. Given the level of comments 
received to the March 2015 RFI, publication of a framework document 
would be largely redundant with the published RFI and preliminary 
analysis. As such, DOE is deviating from the procedures provided in 
appendix A and is not publishing a framework document prior to the 
publication of this NOPR. The Department has determined that it is 
appropriate to proceed with this proposal due to the information 
obtained through the March 2015 RFI and the preliminary analysis.
    Section 6(f)(2) of appendix A specifies that the length of the 
public comment period for a NOPR will vary depending upon the 
circumstances of the particular rulemaking, but will not be less than 
75 calendar days. For this NOPR, DOE has opted to instead provide a 60-
day comment period. As stated previously DOE requested comment in the 
March 2015 RFI on the technical and economic analyses and provided 
stakeholders a 45-day comment period. Additionally, DOE provided a 75-
day comment period for the preliminary analysis. 86 FR 20327. DOE has 
relied on many of the same analytical assumptions and approaches as 
used in the preliminary assessment and has determined that a 60-day 
comment period in conjunction with the prior comment periods provides 
sufficient time for interested parties to review the proposed rule and 
develop comments. As such, DOE has determined that a 75-comment period 
is not necessary for this proposal and that a 60-day comment period is 
sufficient time for interested stakeholders to submit their comments on 
this document.

III. General Discussion

    DOE developed this proposal after considering oral and written 
comments, data, and information from interested parties that represent 
a variety of interests. The following discussion addresses issues 
raised by these commenters.

A. Product Classes and Scope of Coverage

    When evaluating and establishing energy conservation standards, DOE 
divides covered products into product classes by the type of energy 
used or by capacity or other performance-related features that justify 
differing standards. In determining whether a performance-related 
feature justifies a different standard, DOE must consider such factors 
as the utility of the feature to the consumer and other factors DOE 
determines are appropriate. (42 U.S.C. 6295(q)) DOE's review of the 
preliminary analysis and comments received in response to the 
preliminary analysis, in addition to results from an updated test 
sample, are discussed in more detail in section IV.A of this document.

B. Test Procedure

    EPCA sets forth generally applicable criteria and procedures for 
DOE's adoption and amendment of test procedures. (42 U.S.C. 6293) 
Manufacturers of covered products must use these test procedures to 
certify to DOE that their product complies with energy conservation 
standards and to quantify the efficiency of their product. On October 
8, 2021, DOE published a final rule for the test procedure rulemaking 
(86 FR 56608) (the ``October 2021 TP Final Rule''), in which it amended 
appendix D1 and appendix D2, both entitled ``Uniform Test Method for 
Measuring the Energy Consumption of Clothes Dryers,'' to provide 
additional detail in response to questions from manufacturers and test 
laboratories, including additional detail regarding the testing of 
``connected'' models, dryness level selection, and the procedures for 
maintaining the required heat input rate for gas clothes dryers;

[[Page 51743]]

additional detail for the test procedures for performing inactive and 
off mode power measurements; specifications for the final moisture 
content (``FMC'') required for testing automatic termination control 
dryers; specification of a narrower scale resolution for the weighing 
scale used to determine moisture content of test loads; and 
specification that the test load must be weighed within 5 minutes after 
a test cycle has terminated. In addition, DOE amended the test 
procedures to update the estimated number of annual use cycles for 
clothes dryers; provide further direction for additional provisions 
within the test procedures; specify rounding requirements for all 
reported values; apply consistent use of nomenclature and correct 
typographical errors; remove obsolete sections of the test procedures, 
including appendix D; and update the reference to the applicable 
industry test procedure to the version certified by the American 
National Standards Institute (``ANSI''). 86 FR 56608, 56610 DOE's 
current energy conservation standards for consumer clothes dryers are 
expressed in terms of CEFD1. (See 10 CFR 430.32(h)(3).)
    In response to the preliminary analysis, commenters requested that 
DOE finalize the test procedure rulemaking prior to proceeding with 
energy conservation standards rulemaking in order to capture any 
impacts a finalized test procedure would have on amended standards. 
(AHAM, No. 22 at pp. 7-8; AHAM, No. 23 at pp. 2-4; California IOUs, No. 
26 at pp. 4-5; GEA, No. 28 at p. 2; NEEA, No. 30 at p. 8).
    At the time of the publication of the preliminary analysis, the 
October 2021 TP Final Rule had not yet published; however, DOE noted in 
the October 2021 TP Final Rule that the amendments adopted, other than 
the amendment to the number of annual use cycles in appendix D2, would 
not substantively alter the measured efficiency of consumer clothes 
dryers, and that the test procedures would not be unduly burdensome to 
conduct. The amendment to the number of annual use cycles specified for 
calculating per-cycle standby mode and off mode energy consumption 
would alter the measured energy efficiency of consumer clothes dryers 
when using appendix D2, but use of the amended value in appendix D2 is 
not required until such time as DOE were to amend the energy 
conservations standards accounting for such changes in the test 
procedure, should such amended energy conservation standards be 
adopted. 86 FR 56608, 56611.
    GEA, AHAM, and Samsung requested that DOE review the FMC 
requirement according to appendix D2, stating that the current 2-
percent FMC requirement is too strict and not representative of 
consumer preference. (GEA, No. 22 at pp. 42-44; AHAM, No. 23 at p. 4; 
Samsung, No. 29 at pp. 2-3) AHAM questioned the degree of savings that 
can be achieved through more stringent standards, stating that the 
energy conservation standards would have less of an impact on consumer 
clothes dryer energy use than the FMC itself. As stated in the October 
2021 TP Final Rule, the current 2-percent FMC requirement using the DOE 
test cloth was adopted as representative of approximately 5-percent FMC 
for ``real-world'' clothing, based on data submitted in a joint 
petition for rulemaking.\16\ DOE determined in the August 2013 Final 
Rule that the specified 2-percent FMC using the DOE test load was 
representative of consumer expectations for dryness of clothing in 
field use. 78 FR 49608, 49620-49622, 49610-49611 (Aug. 14, 2013). DOE 
has not identified any systemic problems with any consumer clothes 
dryer types being able to achieve the required FMC of 2 percent or 
less, such that amendments to the test procedure would be warranted and 
therefore did not amend the FMC requirement for either appendix D1 or 
appendix D2 in the October 2021 TP Final Rule. 86 FR 56608, 56626.
---------------------------------------------------------------------------

    \16\ The petition was submitted by AHAM, Whirlpool Corporation, 
General Electric Company, Electrolux, LG Electronics, Inc., BSH, 
Alliance Laundry Systems, Viking Range, Sub-Zero Wolf, Friedrich A/
C, U-Line, Samsung, Sharp Electronics, Miele, Heat Controller, AGA 
Marvel, Brown Stove, Haier, Fagor America, Airwell Group, Arcelik, 
Fisher & Paykel, Scotsman Ice, Indesit, Kuppersbusch, Kelon, and 
DeLonghi, American Council for an Energy Efficient Economy, 
Appliance Standards Awareness Project, Natural Resources Defense 
Council, Alliance to Save Energy, Alliance for Water Efficiency, 
Northwest Power and Conservation Council, and Northeast Energy 
Efficiency Partnerships, Consumer Federation of America and the 
National Consumer Law Center. See Docket No. EERE-2011-BT-TP-0054, 
No. 3.
---------------------------------------------------------------------------

    ASAP, NRDC, and Samsung requested that DOE consider the testing of 
an additional smaller test load to supplement the current test load, 
stating a smaller test load could better represent consumer use and 
clothes dryer efficiency. (ASAP, NRDC, No. 25 at p. 1; Samsung, No. 29 
at p. 3) As stated in the October 2021 TP Final Rule, with little 
expected change to the CEFD2 value when considering the 
energy consumption associated with a range of load sizes, DOE does not 
believe the additional testing would provide consumers with improved 
information that would change their purchasing decisions compared to 
the current test procedure. As such, any incremental benefit of testing 
with additional load sizes would be outweighed by the significant added 
burden that would be imposed by conducting such tests. For these 
reasons, DOE did not propose or adopt any amendments to the test 
procedure requiring additional test load sizes in the October 2021 TP 
Final Rule. 86 FR 56608, 56621.
    In response to the preliminary analysis, the California IOUs 
presented data suggesting that consumer clothes dryers that have 
identical ratings under appendix D1 can vary considerably when tested 
to appendix D2, and also stated that DOE's analysis in the preliminary 
TSD shows that baseline efficiency consumer clothes dryers tested under 
appendix D1 significantly underperform when tested under appendix D2. 
For these reasons, the California IOUs recommended that DOE use this 
rulemaking or the open test procedure rulemaking to phase out appendix 
D1 in favor of an updated appendix D2 test procedure. Samsung further 
supported DOE requiring the appendix D2 test procedure for 
manufacturers as the mandatory procedure for testing consumer clothes 
dryers. (California IOUs, No. 26 at p. 5) According to Samsung, 
appendix D2 has been recognized by stakeholders as truly representing 
how automatic termination control dryers are used by consumers, and 
manufacturers of ENERGY STAR-qualified consumer clothes dryers are 
familiar with, and have invested in, the test procedure in appendix D2, 
as it is already mandated for ENERGY STAR qualification. Furthermore, 
Samsung asserted that the appendix D1 test procedure was intended as a 
stopgap measure to test ``sensor [automatic termination control] 
dryers'' using ``non-sensing'' settings (i.e., timer drying cycle) and 
does not represent how automatic termination clothes dryers are used by 
consumers as accurately as the appendix D2 test procedure. Samsung 
recommended that, since appendix D2 has been used for many years for 
ENERGY STAR qualification, appendix D1 be phased out now, with an 
appropriate adjustment to the underlying energy conservation standards 
to reflect the change in test method as described in EPCA. (Samsung, 
No. 29 at p. 2)
    As discussed in the October 2021 TP Final Rule, the version of 
appendix D2 adopted in that final rule would be used for the evaluation 
and issuance of updated energy conservation standards, with compliance 
with that version of appendix D2 required on the

[[Page 51744]]

implementation date of updated standards. 86 FR 56608, 56635-56636 
(Oct. 8, 2021). Accordingly, DOE notes that the preliminary analysis 
and this NOPR analysis are based on the appendix D2 test procedure, and 
therefore the proposed amended energy conservation standards in this 
document are also based on the appendix D2 test procedure. These 
proposed amendments are discussed in more detail in section IV.C of 
this document.

C. Technological Feasibility

1. General
    In evaluating potential amendments to energy conservation 
standards, DOE conducts a screening analysis based on information 
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 an analysis, DOE 
develops a list of technology options for consideration in consultation 
with manufacturers, design engineers, and other interested parties. DOE 
then determines which of those means for improving efficiency are 
technologically feasible. DOE considers technologies incorporated in 
commercially-available products or in working prototypes to be 
technologically feasible. Sections 6(b)(3)(i) and 7(b)(1) of appendix 
A.
    After DOE has determined that particular technology options are 
technologically feasible, it further evaluates each technology option 
in light of the following additional screening criteria: (1) 
practicability to manufacture, install, and service; (2) adverse 
impacts on product utility or availability; (3) adverse impacts on 
health or safety, and (4) unique-pathway proprietary technologies. 
Sections 6(b)(3)(ii)-(v) and 7(b)(2)-(5) of appendix A. Section IV.B of 
this document discusses the results of the screening analysis for 
consumer clothes dryers, particularly the designs DOE considered, those 
it screened out, and those that are the basis for the standards 
considered in this rulemaking. For further details on the screening 
analysis for this rulemaking, see chapter 4 of the NOPR TSD.
2. Maximum Technologically Feasible Levels
    When DOE proposes to adopt an amended standard for a type or class 
of covered product, it must determine the maximum improvement in energy 
efficiency or maximum reduction in energy use that is technologically 
feasible for such product. (42 U.S.C. 6295(p)(1)) Accordingly, in the 
engineering analysis, DOE determined the maximum technologically 
feasible (``max-tech'') improvements in energy efficiency for consumer 
clothes dryers, using the design parameters for the most efficient 
products available on the market or in working prototypes. The max-tech 
levels that DOE determined for this rulemaking are described in section 
IV.C.1 of this document and in chapter 5 of the NOPR TSD.

D. Energy Savings

1. Determination of Savings
    For each trial standard level (``TSL''), DOE projected energy 
savings from application of the TSL to consumer clothes dryers 
purchased in the 30-year period that begins in the year of compliance 
with the proposed standards (2027-2056).\17\ The savings are measured 
over the entire lifetime of consumer clothes dryers purchased in the 
previous 30-year period. DOE quantified the energy savings attributable 
to each TSL as the difference in energy consumption between each 
standards case and the no-new-standards case. The no-new-standards case 
represents a projection of energy consumption that reflects how the 
market for a product would likely evolve in the absence of amended 
energy conservation standards.
---------------------------------------------------------------------------

    \17\ Each TSL is composed of specific efficiency levels for each 
product class. The TSLs considered for this NOPR are described in 
section V.A of this document. DOE conducted a sensitivity analysis 
that considers impacts for products shipped in a 9-year period.
---------------------------------------------------------------------------

    DOE used its national impact analysis (``NIA'') spreadsheet model 
to estimate national energy savings (``NES'') from potential amended or 
new standards for consumer clothes dryers. The NIA spreadsheet model 
(described in section IV.H of this document) calculates energy savings 
in terms of site energy, which is the energy directly consumed by 
products at the locations where they are used. For electricity, DOE 
reports national energy savings in terms of primary energy savings, 
which is the savings in the energy that is used to generate and 
transmit the site electricity. For natural gas, the primary energy 
savings are considered to be equal to the site energy savings. DOE also 
calculates NES in terms of FFC energy savings. The FFC metric includes 
the energy consumed in extracting, processing, and transporting primary 
fuels (i.e., coal, natural gas, petroleum fuels), and thus presents a 
more complete picture of the impacts of energy conservation 
standards.\18\ DOE's approach is based on the calculation of an FFC 
multiplier for each of the energy types used by covered products or 
equipment. For more information on FFC energy savings, see section 
IV.H.2 of this document.
---------------------------------------------------------------------------

    \18\ The FFC metric is discussed in DOE's statement of policy 
and notice of policy amendment. 76 FR 51282 (Aug. 18, 2011), as 
amended at 77 FR 49701 (Aug. 17, 2012).
---------------------------------------------------------------------------

2. Significance of Savings
    To adopt any new or amended standards for a covered product, DOE 
must determine that such action would result in significant energy 
savings.
    The significance of energy savings offered by a new or amended 
energy conservation standard cannot be determined without knowledge of 
the specific circumstances surrounding a given rulemaking.\19\ For 
example, some covered products and equipment have most of their energy 
consumption occur during periods of peak energy demand. The impacts of 
these products on the energy infrastructure can be more pronounced than 
products with relatively constant demand. In evaluating the 
significance of energy savings, DOE considers differences in primary 
energy and FFC effects for different covered products and equipment 
when determining whether energy savings are significant. Primary energy 
and FFC effects include the energy consumed in electricity production 
(depending on load shape), in distribution and transmission, and in 
extracting, processing, and transporting primary fuels (i.e., coal, 
natural gas, petroleum fuels), and thus present a more complete picture 
of the impacts of energy conservation standards.
---------------------------------------------------------------------------

    \19\ The numeric threshold for determining the significance of 
energy savings established in a final rule published on February 14, 
2020 (85 FR 8626, 8670), was subsequently eliminated in a final rule 
published on December 13, 2021 (86 FR 70892).
---------------------------------------------------------------------------

    Accordingly, DOE evaluates the significance of energy savings on a 
case-by-case basis, taking into account the significance of cumulative 
FFC national energy savings, the cumulative FFC emissions reductions, 
and the need to confront the global climate crisis, among other 
factors. As discussed in section V.C of this document, DOE is proposing 
to adopt TSL 3, which would save an estimated 3.11 quads of energy 
(FFC). DOE has initially determined that these energy savings are 
``significant'' within the meaning of 42 U.S.C. 6295(o)(3)(B).

E. Economic Justification

1. Specific Criteria
    As noted previously, EPCA provides seven factors to be evaluated in

[[Page 51745]]

determining whether a potential energy conservation standard is 
economically justified. (42 U.S.C. 6295(o)(2)(B)(i)(I)-(VII)) The 
following sections discuss how DOE has addressed each of those seven 
factors in this rulemaking.
a. Economic Impact on Manufacturers and Consumers
    In determining the impacts of a potential amended standard on 
manufacturers, DOE conducts an MIA, as discussed in section IV.J of 
this document. 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 (1) INPV, which 
values the industry on the basis of expected future cash flows; (2) 
cash flows by year; (3) changes in revenue and income; and (4) 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 individual consumers, measures of economic impact include the 
changes in LCC and PBP associated with new or amended standards. These 
measures are discussed further in the following section. For consumers 
in the aggregate, DOE also calculates the national net present value of 
the consumer costs and benefits expected to result from particular 
standards. DOE also evaluates the impacts of potential standards on 
identifiable subgroups of consumers that may be affected 
disproportionately by a standard.
b. Savings in Operating Costs Compared to Increase in Price (LCC and 
PBP)
    EPCA requires DOE to consider the savings in operating costs 
throughout the estimated average life of the covered product in the 
type (or class) compared to any increase in the price of, or in the 
initial charges for, or maintenance expenses of, the covered product 
that are likely to result from a standard. (42 U.S.C. 
6295(o)(2)(B)(i)(II)) DOE conducts this comparison in its LCC and PBP 
analysis.
    The LCC is the sum of the purchase price of a product (including 
its installation) and the operating expense (including energy, 
maintenance, and repair expenditures) discounted over the lifetime of 
the product. The LCC analysis requires a variety of inputs, such as 
product prices, product energy consumption, energy prices, maintenance 
and repair costs, product lifetime, and discount rates appropriate for 
consumers. To account for uncertainty and variability in specific 
inputs, such as product lifetime and discount rate, DOE uses a 
distribution of values, with probabilities attached to each value.
    The PBP is the estimated amount of time (in years) it takes 
consumers to recover the increased purchase cost (including 
installation) of a more-efficient product through lower operating 
costs. DOE calculates the PBP by dividing the change in purchase cost 
due to a more-stringent standard by the change in annual operating cost 
for the year that standards are assumed to take effect.
    For its LCC and PBP analysis, DOE assumes that consumers will 
purchase the covered products in the first year of compliance with new 
or amended standards. The LCC savings for the considered efficiency 
levels are calculated relative to the case that reflects projected 
market trends in the absence of new or amended standards. DOE's LCC and 
PBP analysis is discussed in further detail in section IV.F of this 
document.
c. Energy Savings
    Although significant conservation of energy is a separate statutory 
requirement for adopting 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)) As 
discussed in section III.D of this document, DOE uses the NIA 
spreadsheet models to project national energy savings.
d. Lessening of Utility or Performance of Products
    In establishing product classes and in evaluating design options 
and the impact of potential standard levels, DOE evaluates potential 
standards that would not lessen the utility or performance of the 
considered products. (42 U.S.C. 6295(o)(2)(B)(i)(IV)) Based on data 
available to DOE, the standards proposed in this document would not 
reduce the utility or performance of the products under consideration 
in this rulemaking.
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 a proposed standard. (42 U.S.C. 
6295(o)(2)(B)(i)(V)) It also directs the Attorney General to determine 
the impact, 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 this proposed 
rule to the Attorney General with a request that the Department of 
Justice (``DOJ'') provide its determination on this issue. DOE will 
publish and respond to the Attorney General's determination in the 
final rule. DOE invites comment from the public regarding the 
competitive impacts that are likely to result from this proposed rule. 
In addition, stakeholders may also provide comments separately to DOJ 
regarding these potential impacts. See the ADDRESSES section for 
information to send comments to DOJ.
f. Need for National Energy Conservation
    DOE also considers the need for national energy and water 
conservation in determining whether a new or amended standard is 
economically justified. (42 U.S.C. 6295(o)(2)(B)(i)(VI)) 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, as 
discussed in section IV.M of this document.
    DOE maintains that environmental and public health benefits 
associated with the more efficient use of energy are important to take 
into account when considering the need for national energy 
conservation. The proposed standards are likely to result in 
environmental benefits in the form of reduced emissions of air 
pollutants and greenhouse gases (``GHGs'') associated with energy 
production and use. DOE conducts an emissions analysis to estimate how 
potential standards may

[[Page 51746]]

affect these emissions, as discussed in section IV.K of this document; 
the estimated emissions impacts are reported in section V.B.6 of this 
document. DOE also estimates the economic value of health benefits from 
certain emissions reductions resulting from the considered TSLs, as 
discussed in section IV.L of this document.
    AHAM stated its continued objection to DOE's use of the social cost 
of carbon and other monetization of emissions reductions benefits in 
its analysis of the factors EPCA requires DOE to balance to determine 
the appropriate standard. According to AHAM, while it may be acceptable 
for DOE to continue its current practice of examining the social cost 
of carbon and monetization of other emissions reductions benefits as 
informational so long as the underlying interagency analysis is 
transparent and vigorous, the monetization analysis should not impact 
the trial standards levels DOE selects as a new or amended standard. 
(AHAM, No. 23 at pp. 11-12)
    DOE's evaluation of whether a potential energy conservation 
standard is economically justified is guided by EPCA and also by OMB 
Circular A-4 (Sept. 17, 2003), which provides guidance to Federal 
agencies on the development of regulatory analysis. As indicated above, 
DOE believes that avoiding negative impacts to human health and the 
wide range of impacts associated with climate change are key factors 
behind the need for energy conservation.\20\ OMB Circular A-4 states: 
``Benefit-cost analysis is a primary tool used for regulatory analysis. 
Where all benefits and costs can be quantified and expressed in 
monetary units, benefit-cost analysis provides decision makers with a 
clear indication of the most efficient alternative, that is, the 
alternative that generates the largest net benefits to society.'' (p. 
2) Monetizing public health benefits of regulations is a long-standing 
practice in Federal regulatory analysis. To not consider such benefits 
when evaluating whether a potential energy conservation standard is 
economically justified would be contrary to both EPCA and OMB's 
guidance. In addition, on March 16, 2022, the Fifth Circuit Court of 
Appeals (No. 22-30087) granted the federal government's emergency 
motion for stay pending appeal of the February 11, 2022, preliminary 
injunction issued in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. 
La.). As a result of the Fifth Circuit's order, the preliminary 
injunction is no longer in effect, pending resolution of the federal 
government's appeal of that injunction or a further court order. Among 
other things, the preliminary injunction enjoined the defendants in 
that case from ``adopting, employing, treating as binding, or relying 
upon'' the interim estimates of the social cost of greenhouse gases--
which were issued by the Interagency Working Group on the Social Cost 
of Greenhouse Gases on February 26, 2021--to monetize the benefits of 
reducing greenhouse gas emissions. As reflected in this rule, DOE has 
reverted to its approach prior to the injunction and presents monetized 
greenhouse gas abatement benefits where appropriate and permissible 
under law.
---------------------------------------------------------------------------

    \20\ As mentioned previously, following the preliminary 
injunction issued on February 11, 2022, in Louisiana v. Biden, No. 
21-cv-1074-JDC-KK (W.D. La.), DOE is currently not monetizing the 
costs of greenhouse gas emissions.
---------------------------------------------------------------------------

g. Other Factors
    In determining whether an energy conservation standard is 
economically justified, DOE may consider any other factors that the 
Secretary deems to be relevant. (42 U.S.C. 6295(o)(2)(B)(i)(VII)) To 
the extent DOE identifies any relevant information regarding economic 
justification that does not fit into the other categories described 
previously, DOE could consider such information under ``other 
factors.''
2. Rebuttable Presumption
    As set forth in 42 U.S.C. 6295(o)(2)(B)(iii), EPCA creates a 
rebuttable presumption that an energy conservation standard is 
economically justified if the additional cost to the consumer of a 
product that meets the standard 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 
analyses generate values used to calculate the effects that proposed 
energy conservation standards would have on the payback period for 
consumers. These analyses include, but are not limited to, the 3-year 
payback period contemplated under the rebuttable-presumption test. In 
addition, DOE routinely conducts an economic analysis that considers 
the full range of impacts to consumers, manufacturers, the Nation, and 
the environment, as required under 42 U.S.C. 6295(o)(2)(B)(i). The 
results of this analysis 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.F.9 of this document.

IV. Methodology and Discussion of Related Comments

    This section addresses the analyses DOE has performed for this 
rulemaking with regard to consumer clothes dryers. Separate sections 
address each component of DOE's analyses.
    DOE used several analytical tools to estimate the impact of the 
standards proposed in this document. The first tool is a spreadsheet 
that calculates the LCC savings and PBP of potential amended or new 
energy conservation standards. The national impacts analysis uses a 
second spreadsheet set that provides shipments projections and 
calculates national energy savings and net present value of total 
consumer costs and savings expected to result from potential energy 
conservation standards. DOE uses the third spreadsheet tool, the 
Government Regulatory Impact Model (``GRIM''), to assess manufacturer 
impacts of potential standards. These three spreadsheet tools are 
available on the DOE website for this rulemaking: www.regulations.gov/docket/EERE-2014-BT-STD-0058/. Additionally, DOE used output from the 
latest version of the Energy Information Administration's (``EIA's'') 
Annual Energy Outlook (``AEO''), a widely known energy projection for 
the United States, for the emissions and utility impact analyses.

A. Market and Technology Assessment

    DOE develops information in the market and technology assessment 
that provides an overall picture of the market for the products 
concerned, including the purpose of the products, the industry 
structure, manufacturers, market characteristics, and technologies used 
in the products. This activity includes both quantitative and 
qualitative assessments, based primarily on publicly available 
information. The subjects addressed in the market and technology 
assessment for this rulemaking include (1) a determination of the scope 
of the rulemaking and product classes, (2) manufacturers and industry 
structure, (3) existing efficiency programs, (4) shipments information, 
(5) market and industry trends, and (6) technologies or design options 
that could improve the energy efficiency of consumer clothes dryers. 
The key findings of DOE's market assessment are summarized in the 
following sections. See chapter 3 of the NOPR TSD for further 
discussion of the market and technology assessment.

[[Page 51747]]

1. Scope of Coverage and Product Classes
    DOE defines ``electric clothes dryer'' under EPCA as a cabinet-like 
appliance designed to dry fabrics in a tumble-type drum with forced air 
circulation. The heat source is electricity and the drum and blower(s) 
are driven by an electric motor(s). Similarly, DOE defines ``gas 
clothes dryer'' as a cabinet-like appliance designed to dry fabrics in 
a tumble-type drum with forced air circulation. The heat source is gas 
and the drum and blower(s) are driven by an electric motor(s). (10 CFR 
430.2)
    In response to the preliminary analysis, the California IOUs 
offered information on at least two manufacturers producing a dry-and-
steam clothing cabinet and encouraged DOE to explore the market 
prevalence and potential growth of this equipment and what features 
represent an average use cycle. The California IOUs also suggested DOE 
consider the current clothes washers rulemaking or dehumidifiers 
rulemaking to provide guidance on how this product should be classified 
and, if appropriate, tested and rated. (California IOUs, No. 26 at p. 
7) DOE may investigate this product in a future rulemaking; however, as 
this product does not meet the definition of a clothes dryer because it 
does not include a tumble-type drum, it was not included in this 
analysis.
    The current product classes, which were established by the April 
2011 Direct Final Rule, are presented in Table IV.1.

       Table IV.1--Current Consumer Clothes Dryer Product Classes
------------------------------------------------------------------------
 
-------------------------------------------------------------------------
Vented dryers:
    Electric, Standard (4.4 cubic feet (ft\3\) or greater capacity).
    Electric, Compact (120 volts (V)) (less than 4.4 ft\3\ capacity).
    Electric, Compact (240 V) (less than 4.4 ft\3\ capacity).
    Gas.
Ventless dryers:
    Electric, Compact (240 V) (less than 4.4 ft\3\ capacity).
    Electric, Combination Washer-Dryer.
------------------------------------------------------------------------

    Based on its review of products available on the market in the 
United States, DOE notes that at least six manufacturers currently 
offer a ventless clothes dryer with a drum capacity greater than 4.4 
ft\3\. As a result, in the preliminary analysis, DOE analyzed an 
additional product class for ventless electric standard clothes dryers, 
with drum capacity larger than 4.4 ft\3\.
    In response to the preliminary analysis, the California IOUs 
requested that DOE investigate potential reporting errors within the 
Compliance Certification Database (``CCD''), as the California IOUs 
asserted that multiple products were incorrectly listed in the CCD as 
``vented'' products while certified as ``ventless'' products in the 
ENERGY STAR product database and represented as ``ventless'' in 
manufacturer literature. (California IOUs, No. 26 at p. 4) DOE will 
work to investigate any classification errors within the CCD and 
requests comment on additional information regarding potential 
classification errors.
    In response to the preliminary analysis, ASAP, NRDC, the California 
IOUs, and NEEA requested that DOE review the efficiencies of models 
currently available on the market, specifically for the vented electric 
standard product class, stating that there are currently available 
models with higher efficiencies than the max-tech efficiency level 
considered in the preliminary analysis for this product class. (ASAP, 
NRDC, No. 25 at pp. 1-2; California IOUs, No. 26 at pp. 3-4; NEEA, No. 
30 at pp. 10-11) Upon review of these higher efficiency models, DOE 
discovered that many of the higher efficiency electric standard clothes 
dryers on the market are ventless and employ heat pump technology and 
that there are no lower-efficiency ventless electric standard models 
associated with the less efficient condensing technology that is 
available with the ventless electric compact (240V) product class. 
Given that most heat pump designs at the standard size are inherently 
ventless and result in higher efficiencies, establishing a product 
class for ventless electric standard clothes dryers would essentially 
result in a separate product class for heat pump dryers and leave the 
vented electric standard product class with less efficient conventional 
resistive heating-element dryers. This would effectively restrict the 
efficiency of the vented electric standard product class, as higher 
efficiency technologies would be associated with a different product 
class.
    DOE received comments from AHAM and Whirlpool in response to the 
preliminary analysis stating that ventless electric clothes dryers, 
especially those implementing heat pump designs, have difficulty in 
meeting the 2-percent FMC requirement with Whirlpool stating that 
ventless electric clothes dryers result in longer cycle times than 
conventional vented clothes dryers. (AHAM, No. 23, p. 11; Whirlpool, 
No. 27 at pp. 13-17) Additionally, Whirlpool recommended that DOE 
consider the consumer utility of the differences that arise when 
consumer clothes dryers utilize heat pump technology and to establish a 
separate product class for heat pump clothes dryers (including hybrid 
heat pump clothes dryers). Whirlpool stated that differences in fabric 
care, drying time, heating and cooling energy impacts, lower drying 
temperatures, and technology used are all relevant performance-related 
features that distinguish heat pump and hybrid heat pump clothes dryers 
from all other consumer clothes dryer product classes, which may 
justify a higher standard than for other product types. (Whirlpool, No. 
27 at p. 17) DOE observes that all standard size ventless electric 
clothes dryers and compact ventless electric (120V) clothes dryers are 
rated according to appendix D2 and are ENERGY STAR-qualified, and 
therefore meet the 80-minute cycle time requirement to receive ENERGY 
STAR recognition. Additionally, DOE found no issue in its own testing 
of ventless electric clothes dryers inherent in the ventless electric 
clothes dryer design that supports the claims made by commenters 
regarding difficulty in meeting the FMC requirement and longer cycle 
times (i.e., all ventless electric clothes dryers tested, including 
those utilizing either condensing or heat pump technology, were able to 
meet the 2-percent FMC requirement).
    As discussed, a rule prescribing an energy conservation standard 
must specify a level of energy use or efficiency higher or lower than 
that which applies (or would apply) for any group of covered products 
which have the same function or intended use, if the Secretary 
determines that covered products within such group have a

[[Page 51748]]

capacity or other performance-related feature which justifies a higher 
or lower standard. (42 U.S.C. 6295(q)(1)(B)) For standard size electric 
clothes dryers, the ventless feature does not justify a separate 
standard as compared to standard size electric clothes dryers that are 
vented. Standard size ventless electric clothes dryers can accommodate 
heat pump technology that results in improved efficiency similar to 
that for standard size vented electric clothes dryers. Therefore, upon 
further consideration, no product class distinction is proposed in this 
NOPR between ventless and vented electric standard clothes dryers, nor 
between heat pump and non-heat pump clothes dryers.
    Instead, DOE proposes an ``electric standard'' product class that 
would comprise both ventless and vented electric standard clothes 
dryers. Such a product class would not impact consumer utility, given 
that a consumer could install a ventless electric standard clothes 
dryer in the same locations as vented electric standard clothes dryers, 
and would not result in unacceptable drying performance or cycle time, 
as evidenced by the existing heat pump clothes dryers that are able to 
achieve the 2-percent FMC requirement within an 80-minute cycle time.
    In response to the preliminary analysis, the California IOUs 
requested that DOE consider an additional product class for ventless 
electric compact (120V) models, as such clothes dryers are currently 
available on the market. (California IOUs, No. 26 at p. 3) Upon further 
review, DOE found that, as for ventless electric standard clothes 
dryers, all currently available ventless electric compact (120V) 
clothes dryers utilize heat pump technology. For the same reasons as 
for electric standard clothes dryers (i.e., to capture the energy 
savings associated with heat pump technology and to avoid restricting 
potential efficiency gains for vented electric clothes dryers), DOE 
proposes an ``electric compact (120V)'' product class comprising 
ventless and vented electric compact (120V) models.
    In light of the proposal to have single product classes containing 
all standard size electric clothes dryers and a single product class 
for all compact electric (120V) clothes dryers, DOE also considered 
whether to maintain the current separate product classes distinction 
based on venting for compact electric (240V) clothes dryers. DOE has 
previously determined that for compact electric clothes dryers, a 
ventless configuration is a consumer utility because these dryers 
provide for installations in space-constrained environments. 76 FR 
22454, 22485 (Apr. 21, 2011). Based on the analysis presented in this 
NOPR, DOE has tentatively determined that the higher efficiencies for 
ventless compact (240V) clothes dryers would not be economically 
justified as they would be for vented compact (240V) clothes dryers. 
See Section IV.F of this document. Therefore, DOE tentatively 
determines that venting characteristics continue to justify a separate 
product class for compact (240V) clothes dryers.
    As discussed, vented electric clothes dryers are divided, in part, 
based on capacity such that there is a standard size product class (4.4 
ft\3\ or greater capacity) and compact classes (capacity less than 4.4 
ft\3\). There is no similar class distinction for vented gas clothes 
dryers. Since the previous energy conservation standards rulemaking, 
DOE has identified at least one manufacturer of a vented gas clothes 
dryer with a drum less than 4.4 ft\3\. Such capacity units are subject 
to the energy conservation standard for vented gas clothes dryers. AHAM 
supported splitting the product classes for gas clothes dryers based on 
capacity consistent with the product classes for electric dryers. 
(AHAM, No. 23 at p. 7)
    As discussed, DOE must specify a different standard level for a 
type or class of product 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 products within such 
type (or class); or (B) have a capacity or other performance-related 
feature which other products within such type (or class) do not have 
and such feature justifies a higher or lower standard. (42 U.S.C. 
6295(q)(1)) In determining whether a performance-related feature 
justifies a different standard for a group of products, DOE must 
consider such factors as the utility to the consumer of the feature and 
other factors DOE deems appropriate. Id.
    In evaluating potential technologies to improve the energy 
efficiency of vented gas clothes dryers, DOE tentatively has determined 
that vented gas clothes dryers with a capacity of less than 4.4 ft\3\ 
perform in a way that is substantively different than vented gas 
clothes dryers that are 4.4 ft\3\ or greater in capacity. For example, 
DOE has observed that compact vented gas clothes dryers generally 
perform at a lower efficiency than standard size vented gas clothes 
dryers, likely due to the chassis size restrictions, and due to that 
inherent difference, DOE believes that a separate product class is 
warranted. Furthermore, creating a new product class for vented gas 
clothes dryers with a capacity of less than 4.4 ft\3\ would ensure that 
efficiency levels and potential amended standards could better and more 
directly assess the impact of design option implementations for a given 
product configuration. Therefore, DOE has tentatively determined that a 
separate product class and standard for vented gas compact clothes 
dryers (i.e., with a capacity less than 4.4 ft\3\) are justified for 
similar reasons as DOE determined for vented electric compact clothes 
dryers. See 76 FR 22404, 22485 (Apr. 21, 2011). As a result, DOE 
analyzed separate product classes for vented gas standard and vented 
gas compact clothes dryers.
    In sum, DOE proposes the consumer clothes dryer product classes 
listed in Table IV.2 in this NOPR, which expand the scope of certain 
product classes to include both vented and ventless designs, and 
include an additional product class for compact vented gas dryers.

Table IV.2--Notice of Proposed Rulemaking Consumer Clothes Dryer Product
                                 Classes
------------------------------------------------------------------------
 
-------------------------------------------------------------------------
Product Classes:
    1. Electric, Standard (4.4 cubic feet (ft\3\) or greater capacity).
    2. Electric, Compact (120 volts (V)) (less than 4.4 ft\3\ capacity).
    3. Vented Electric, Compact (240 V) (less than 4.4 ft\3\ capacity).
    4. Vented Gas, Standard (4.4 ft\3\ or greater capacity).
    5. Vented Gas, Compact (less than 4.4 ft\3\ capacity).
    6. Ventless Electric, Compact (240 V) (less than 4.4 ft\3\
     capacity).
    7. Ventless Electric, Combination Washer/Dryer.
------------------------------------------------------------------------


[[Page 51749]]

2. Technology Options
    In the preliminary market analysis and technology assessment, DOE 
identified 16 technology options that would be expected to improve the 
efficiency of consumer clothes dryers, as measured by the DOE test 
procedure. DOE continues to consider these technology options in this 
NOPR analysis. These technology options can be broadly grouped into 
five main categories: dryer control or drum upgrades, methods of 
exhaust heat recovery (for vented models only), heat generation 
options, improvements to components, and options to reduce standby 
power.

    Table IV.3--Preliminary Analysis: Technology Options for Consumer
                             Clothes Dryers
------------------------------------------------------------------------
 
-------------------------------------------------------------------------
Dryer Control or Drum Upgrades:
    Improved termination.
    Increased insulation.
    Modified operating conditions.
    Improved air circulation.
    Improved drum design.
Methods of Exhaust Heat Recovery (Vented Models Only):
    Recycle exhaust heat.
    Inlet air preheat.
    Inlet air preheat, condensing mode.
Heat Generation Options:
    Heat pump, electric only.
    Thermoelectric heating, electric only.
    Microwave, electric only.
    Modulating heat.
    Indirect heating.
Component Improvements:
    Improved motor efficiency.
    Improved fan efficiency.
Standby Power Improvements:
    Transformerless power supply with auto-powerdown.
------------------------------------------------------------------------

    DOE notes that two recently developed consumer clothes dryer 
technologies were not included as part of the preliminary analysis: 
long wavelength radio frequency (``RF'') drying and ultrasonic drying. 
Despite the potential benefits of RF and ultrasonic clothes drying, 
however, both technologies are currently under patent or have received 
a provisional patent. Any energy conservation standard that relied on 
either of these technologies would unfairly advantage the manufacturer 
or individual holder of the patent, and thus DOE did not consider them 
as technology options for the preliminary analysis. Because these 
technologies are technologically feasible, however, DOE proposes in 
this NOPR to retain these as technology options in the technology 
assessment, noting one of the criteria for screening technology options 
for use in further analyses is whether a technology represents a unique 
proprietary pathway (see section IV.B of this document and chapter 4 of 
the NOPR TSD). DOE notes that the current energy conservation standards 
for consumer clothes dryers would not prohibit the use of these 
technologies.
    DOE received several comments in response to the technologies 
proposed in the preliminary analysis to be analyzed for consumer 
clothes dryers.
    Whirlpool suggested that reduced drum seal leakage be considered as 
a technology option. Additionally, Whirlpool stated that approaches to 
reduce standby power may not be consumer-friendly solutions that 
manufacturers would readily implement. Whirlpool suggested that 
delaying the drum light turning on after opening the door or delaying 
the start of a cycle after powering on the unit would frustrate 
consumers, as they typically expect appliances to turn on when action 
is taken such as pressing the power button or opening the door. 
Whirlpool also suggested an off position on the control dial but stated 
that intellectual property may exist around this and may result in 
higher costs. (Whirlpool, No. 27 at p. 17) DOE is not aware of data at 
this time to characterize the impacts reduced drum seal leakage may 
have on efficiency and requests information on efficiency impacts of 
this technology. In addition, the strategies that Whirlpool suggested 
to reduce energy use in standby mode, including delaying the activation 
of the drum light after a door opening or delaying the start of the 
cycle after powering on the unit, would not be measured by appendix D2. 
Furthermore, although appendix D2 incorporates measures of energy use 
in both off mode and inactive (standby) mode, DOE does not have 
information to indicate the relative power consumption in each of these 
modes for any consumer clothes dryers on the market which may have an 
off mode position on the controls, which would provide an estimate of 
the reduction in combined low-power mode energy use. For these reasons, 
at this time, DOE is not proposing to include these technology options 
in its analysis.
    NEEA stated that manufacturers in the current consumer clothes 
dryer market utilize an ``eco mode'' as a lower heat/longer drying time 
strategy to achieve a given efficiency. NEEA asserted that the 
efficiency of a consumer clothes dryer increases substantially with 
lower heat and longer drying time, citing laboratory testing by the 
California IOUs that quantified this effect by alternating periods of 
heat with no heat during a cycle. According to the results of this 
work, NEEA claimed, the average efficiency of consumer clothes dryers 
with these modified controls increased 30 percent compared to their 
default settings used for appendix D2 testing, and drying time 
increased 140 percent. According to NEEA, a no-heat cycle took 4 hours 
to complete but achieved a CEFD2 value of 7.0. NEEA stated 
that with the energy savings associated with this strategy, as well as 
the relatively low cost associated with the redesign of the control 
panel to enable additional heater/burner algorithms, manufacturers have 
a solid incentive to extensively utilize eco mode as the sole redesign 
strategy to enable their models to meet DOE's forthcoming mandatory 
standard. NEEA warned that the longer drying times associated with 
these energy saving programs are unlikely to be acceptable to many 
consumers in some

[[Page 51750]]

circumstances (e.g., serial dryer loads and other time-sensitive 
loads), which could potentially result in consumers regularly disabling 
these eco modes and may therefore significantly reduce the energy 
savings of dryers in everyday use relative to expectations created by 
the current appendix D2 test procedure. Therefore, NEEA requested that 
DOE require the sole use of appendix D2 for certification purposes as 
well as the required reporting of cycle times in order to mitigate 
against significant reductions in actual real-world energy savings 
associated with a low heat/long drying time eco mode strategy. 
According to NEEA, cycle time reporting would help moderate 
inordinately long cycle times during the D2 test, enable consumers and 
other stakeholders to consider trade-offs between the efficiency and 
cycle time for a given model, and provide data to possibly consider 
more sophisticated approaches to cycle time in subsequent standard 
updates. (NEEA, No. 30 at pp. 1-7) DOE recognizes that some consumer 
clothes dryers are currently certified using appendix D2, and their 
controls may include an ``eco mode'' or ``energy saver mode,'' which 
typically reduce the temperature used in the cycle at the expense of 
increasing the drying time. However, appendix D2 requires, for 
automatic termination control dryers, that the ``normal'' program be 
selected for the energy test cycle. In the event that the automatic 
termination control dryer does not have a ``normal'' program, the cycle 
recommended by the manufacturer for drying cotton or linen clothing is 
selected. Where the drying temperature setting can be chosen 
independently of the program (as would be the case if ``eco mode'' or 
``energy saver mode'' were an optional setting that could be selected 
for the ``normal'' program), the drying temperature must be set to the 
maximum. Section 3.3.2, appendix D2. For timer dryers, the maximum 
temperature setting is selected for the energy test cycle. Section 
3.3.1, appendix D2. Therefore, an available ``eco mode'' or ``energy 
saver mode'' would not be included in the energy test cycle, as they 
would not produce a measure of energy use during a representative 
cycle. For this reason, DOE did not consider such energy saving modes 
as a technology option in this NOPR.
    NEEA further encouraged DOE to consider the following technology 
options: (1) coupled blower modulation with the multi-stage burner/
heater efficiency level, (2) cabinet insulation, (3) backward curved 
fan blades, and (4) recuperation heat recovery in vented heat pump 
clothes dryers associated with a PNNL study. (NEEA, No. 30 at pp. 12-
13) DOE notes that blower modulation is already coupled with the multi-
stage burner/heater efficiency level for both electric and gas consumer 
clothes dryers, although this was not previously stated in chapter 5 of 
the preliminary TSD. DOE has not observed the technology option of 
cabinet insulation in clothes dryers used in this analysis, and 
therefore does not currently have sufficient information to determine 
the potential efficiency impacts associated with the suggested 
technology options, however, DOE notes that with the inherent risk of 
fires that may occur during operation of a consumer clothes dryer, any 
insulation used within the cabinet space would likely need to be fire 
retardant in order to satisfy the fire containment requirements 
according to the UL 2158 safety standard. While insulation of the dryer 
cabinet space would likely lead to potential energy savings, DOE 
expects that the insulation could lead to an increased internal cabinet 
temperature and may potentially lead to the degradation of other 
components within the clothes dryer assembly. DOE therefore requests 
information that would be beneficial in determining any impacts to 
efficiency or performance as a result of implementing each of the 
technology options mentioned. DOE notes that improvements to fan blades 
would be captured in the analyzed technology options as improved fan 
efficiency, however the efficiency improvements specified by NEEA refer 
to heating, ventilation, and air conditioning (``HVAC'') research and 
do not specifically refer to efficiency improvements in consumer 
clothes dryers. Therefore, until DOE has sufficient information on 
efficiency improvements associated with fan designs, the proposed 
incremental efficiency levels will not be associated with improved fan 
efficiency. Regarding the recuperation heat recovery technology option, 
DOE notes that this technology is already considered in this analysis 
referred to as the inlet-air preheat design option. Given the proposed 
change to the product class structure regarding the combination of 
vented and ventless clothes dryers in the standard and compact (120V) 
categories, this technology is now considered in the proposed design 
options for vented consumer clothes dryers, however given that DOE has 
not observed inlet-air preheat technology in consumer clothes dryers on 
the market, specifically heat pump consumer clothes dryers, this 
technology has not been considered at the max-tech level associated 
with heat pump technology.
    Table IV.4 lists the technology options identified for consumer 
clothes dryers in this NOPR. With the inclusion of RF and ultrasonic 
drying technologies in the list of technology options in the NOPR, DOE 
has renamed the grouping for ``heat generation options'' as ``moisture 
removal options.'' See chapter 3 of the NOPR TSD for further discussion 
of the analyzed technologies.

       Table IV.4--Technology Options for Consumer Clothes Dryers
------------------------------------------------------------------------
 
-------------------------------------------------------------------------
Dryer Control or Drum Upgrades:
    Improved termination.
    Increased insulation.
    Modified operating conditions.
    Improved air circulation.
    Improved drum design.
Methods of Exhaust Heat Recovery (Vented Models Only):
    Recycle exhaust heat.
    Inlet air preheat.
    Inlet air preheat, condensing mode.
Moisture Removal Options:
    Heat pump, electric only.
    Thermoelectric heating, electric only.
    Microwave, electric only.
    Modulating heat.
    Indirect heating.
    RF drying, electric only.

[[Page 51751]]

 
    Ultrasonic drying, electric only.
Component Improvements:
    Improved motor efficiency.
    Improved fan efficiency.
Standby Power Improvements:
    Transformerless power supply with auto-powerdown.
------------------------------------------------------------------------

B. Screening Analysis

    DOE uses the following five screening criteria to determine which 
technology options are suitable for further consideration in an energy 
conservation standards rulemaking:
    (1) Technological feasibility. Technologies that are not 
incorporated in commercial products or in working prototypes will not 
be considered further.
    (2) Practicability to manufacture, install, and service. If it is 
determined that mass production and reliable installation and servicing 
of a technology in commercial products could not be achieved on the 
scale necessary to serve the relevant market at the time of the 
projected compliance date of the standard, then that technology will 
not be considered further.
    (3) Impacts on product utility or product availability. If it is 
determined that a technology would have a significant adverse impact on 
the utility of the product for significant subgroups of consumers or 
would result in the unavailability of any covered product type with 
performance characteristics (including reliability), features, sizes, 
capacities, and volumes that are substantially the same as products 
generally available in the United States at the time, it will not be 
considered further.
    (4) Adverse impacts on health or safety. If it is determined that a 
technology would have significant adverse impacts on health or safety, 
it will not be considered further.
    (5) Unique-Pathway Proprietary Technologies. If a design option 
utilizes proprietary technology that represents a unique pathway to 
achieving a given efficiency level, that technology will not be 
considered further due to the potential for monopolistic concerns.

10 CFR part 430, subpart C, appendix A, 6(b)(3) and 7(b).

    In summary, if DOE determines that a technology, or a combination 
of technologies, fails to meet one or more of the listed five criteria, 
it will be excluded from further consideration in the engineering 
analysis. The reasons for eliminating any technology are discussed in 
the following sections.
    The subsequent sections include comments from interested parties 
pertinent to the screening criteria, DOE's evaluation of each 
technology option against the screening analysis criteria, and whether 
DOE determined that a technology option should be excluded (``screened 
out'') based on the screening criteria.
1. Screened-Out Technologies
    AHAM requested that DOE consider the effects that different 
technology options may have on fabric care, specifically the impact 
longer drying cycles may have on fabric. (AHAM, No. 23 at p. 10) While 
certain technology options may be associated with an increase in cycle 
times (e.g., modified operating conditions (reduced drying 
temperatures) and heat pump technology), DOE notes that AHAM did not 
provide, nor is DOE aware of, information correlating fabric care 
directly to cycle time. In addition, if longer cycle times are 
accompanied by lower drying temperatures, it is uncertain whether the 
net impact on fabric care is positive or negative, and how this result 
would vary based on fabric type. Therefore, DOE did not screen out any 
technology options solely on the basis of any fabric care 
considerations due to cycle time. However, DOE requests comment on any 
potential impacts that different technology options, including any that 
may impact cycle times, have on fabric care.
a. Thermoelectric Heating, Electric Only
    DOE notes that Oak Ridge National Laboratory (``ORNL'') is still 
researching thermoelectric heating clothes dryers. While ORNL's test 
results of a preliminary prototype have shown the potential for 
improved efficiency, ORNL indicated that the initial prototype design 
produced longer-than-desired drying times due to direct-contact heat 
transfer limitations via the drum surface. ORNL has subsequently 
developed another prototype which added pumped secondary water loops 
that transferred heat from the thermoelectric modules to the process 
air via air-to-water heat exchangers to further improve efficiency and 
minimize cycle length. ORNL's testing indicated efficiency and cycle 
times for this prototype that are approximately equivalent to those of 
vapor compression heat pump clothes dryers.\21\ Because the research 
for such a thermoelectric heating clothes dryer that produces energy 
savings and meets consumer expectations for drying cycle time is still 
in the prototype stage, DOE determined that this technology option 
would not be practicable to manufacture, install, and service on a 
scale necessary to serve the relevant market at the time of the 
projected compliance date of any new or amended consumer clothes dryer 
standards, and did not be consider it for further analysis.
---------------------------------------------------------------------------

    \21\ Patel, V., Boudreaux, P., and Gluesenkamp, K. Oak Ridge 
National Laboratory. Validated Model of a Thermoelectric Heat Pump 
Clothes Dryer Using Secondary Pumped Loops. Applied Thermal 
Engineering, Volume 184, February 5, 2021.
---------------------------------------------------------------------------

b. Microwave, Electric Only
    Due to the large energy savings associated with microwave drying, 
this technology was the subject of a multi-year development effort at 
the Electric Power Research Institute (``EPRI'') in the mid-1990s; \22\ 
and at least one major manufacturer, Whirlpool Corporation 
(``Whirlpool''), developed a countertop-scale version of such a product 
as recently as 2002,\23\ but to date this technology has not been 
successfully commercialized.
---------------------------------------------------------------------------

    \22\ S. Ashley. 1998. ``Energy-Efficient Appliances'', 
Mechanical Engineering Magazine, March, 1998, pp. 94-97.
    \23\ E. Spagat. 2002. ``Whirlpool Goes Portable to Sell Dryers 
to Gen Y'', Wall Street Journal, June 4, 2002.
---------------------------------------------------------------------------

    Significant technical and safety issues are introduced by the 
potential arcing from metallic objects in the fabric load, including 
zippers, buttons, or ``stray'' items such as coins. While efforts have 
been made to mitigate the conditions that are favorable to arcing, or 
to detect incipient arcing and terminate the cycle, the possibility of 
fabric damage cannot be completely eliminated.\24\ In addition to 
consumer utility impacts, these conditions can also pose a safety 
hazard.

[[Page 51752]]

For these reasons, microwave drying was not considered further for 
analysis.
---------------------------------------------------------------------------

    \24\ J.F. Gerling. 2003. ``Microwave Clothes Drying--Technical 
Solutions to Fundamental Challenges'', Appliance Magazine, April, 
2003, p. 120.
---------------------------------------------------------------------------

c. Indirect Heating
    Indirect heating would be viable only in residences that use a 
hydronic heating system. Also, in order to derive clothes dryer heat 
energy from the home's heating system, significant plumbing work would 
be required to circulate heated water through a heat exchanger in the 
clothes dryer. Therefore, this technology option does not meet the 
criterion of practicability to install on a scale necessary to serve 
the relevant market at the time of the effective date of any new 
standard and will not be considered for further analysis.
d. RF Drying, Electric Only
    CoolDry, LLC (``CoolDry''), developed an RF clothes dryer 
prototype, claiming an efficiency of 90 percent, compared to 50 percent 
for conventional clothes dryers.\25\ CoolDry states that its RF drying 
technology operates at lower temperatures than do conventional clothes 
dryers and, because the transfer of energy to clothes is not dependent 
on convective heat transfer, the RF clothes dryer requires less 
tumbling and subsequently consumes less energy for drum rotation than a 
conventional clothes dryer. Because this technology was in the 
prototype stage at the time it was initially considered and the company 
is no longer in business and thus there is likely no longer research 
and development ongoing, DOE determined that this technology option 
would not be practicable to manufacture, install, and service on a 
scale necessary to serve the relevant market at the time of the 
projected compliance date of any new or amended consumer clothes dryer 
standards, and did not be consider it for further analysis.
---------------------------------------------------------------------------

    \25\ CoolDry does not specify the metric or test method used to 
determine the efficiency of its prototype. More information is 
available at: https://www.cooldryrf.com/.
---------------------------------------------------------------------------

e. Ultrasonic Drying, Electric Only
    Researchers at ORNL have developed an ultrasonic drying prototype 
that uses piezoelectric transducers to separate water from clothes 
through water cavitation produced by ultrasonic vibrations. According 
to their research, the energy imparted to the water must overcome 
surface tension in order to break the water into droplets, but this 
energy is substantially less than the latent heat of vaporization of 
water, which is the primary thermodynamic barrier for conventional 
evaporation drying. The ORNL researchers anticipate that ultrasonic 
drying technology will result in an energy factor (``EF'') \26\ of 
greater than 10 and a drying time of less than 20 minutes.\27\ Because 
this technology is still in the prototype stage, DOE determined that 
this technology option would not be practicable to manufacture, 
install, and service on a scale necessary to serve the relevant market 
at the time of the projected compliance date of any new or amended 
consumer clothes dryer standards, and did not be consider it for 
further analysis.
---------------------------------------------------------------------------

    \26\ EF only incorporates active mode energy use and not standby 
and off mode energy use.
    \27\ Momen, A. Ultrasonic Clothes Dryer: 2016 Building 
Technologies Office Peer Review. 2016. Prepared for the U.S. 
Department of Energy at Oak Ridge National Laboratory, in 
partnership with the University of Florida and General Electric. p. 
2.
---------------------------------------------------------------------------

2. Remaining Technologies
    Through a review of each technology, DOE tentatively concludes that 
all of the other identified technologies listed in section IV.A.2 of 
this document met all five screening criteria to be examined further as 
design options in DOE's NOPR analysis. In summary, DOE did not screen 
out the following technology options listed in Table IV.5.

     Table IV.5--Retained Design Options for Consumer Clothes Dryers
------------------------------------------------------------------------
 
-------------------------------------------------------------------------
Dryer Control or Drum Upgrades:
    Improved termination.
    Modified operating conditions.
    Improved air circulation.
    Increased insulation.
    Improved drum design.
Methods of Exhaust Heat Recovery (vented models only):
    Recycle exhaust heat.
    Inlet air preheat.
    Inlet air preheat, condensing mode.
Moisture Removal Options:
    Heat pump, electric only.
    Modulating heat.
Component Improvements:
    Improved motor efficiency.
    Improved fan efficiency.
Standby Power Improvements:
    Transformerless Power Supply with Auto-Powerdown.
------------------------------------------------------------------------

    DOE has initially determined that these technology options are 
technologically feasible because they are being used or have previously 
been used in commercially-available products or working prototypes. DOE 
also finds that all of the remaining technology options meet the other 
screening criteria (i.e., practicable to manufacture, install, and 
service and do not result in adverse impacts on consumer utility, 
product availability, health, or safety, nor are unique-pathway 
proprietary technologies). For additional details, see chapter 4 of the 
NOPR TSD.

C. Engineering Analysis

    The purpose of the engineering analysis is to establish the 
relationship between the efficiency and cost of consumer clothes 
dryers. There are two elements to consider in the engineering analysis; 
the selection of efficiency levels to analyze (i.e., the ``efficiency 
analysis'') and the determination of product cost at each efficiency 
level (i.e., the ``cost analysis''). In determining the performance of 
higher-efficiency products, DOE considers technologies and design 
option combinations not eliminated by the screening analysis. For each 
product class, DOE estimates the baseline cost, as well as the 
incremental cost for the product at efficiency levels above the 
baseline. The output of the engineering analysis is a

[[Page 51753]]

set of cost-efficiency ``curves'' that are used in downstream analyses 
(i.e., the LCC and PBP analyses and the NIA).
1. Efficiency Analysis
    DOE typically uses one of two approaches to develop energy 
efficiency levels for the engineering analysis: (1) relying on observed 
efficiency levels in the market (i.e., the efficiency-level approach), 
or (2) determining the incremental efficiency improvements associated 
with incorporating specific design options to a baseline model (i.e., 
the design-option approach). Using the efficiency-level approach, the 
efficiency levels established for the analysis are determined based on 
the market distribution of existing products (in other words, based on 
the range of efficiencies and efficiency level ``clusters'' that 
already exist on the market). Using the design option approach, the 
efficiency levels established for the analysis are determined through 
detailed engineering calculations and/or computer simulations of the 
efficiency improvements from implementing specific design options that 
have been identified in the technology assessment. DOE may also rely on 
a combination of these two approaches. For example, the efficiency-
level approach (based on actual products on the market) may be extended 
using the design option approach to ``gap fill'' levels (to bridge 
large gaps between other identified efficiency levels) and/or to 
extrapolate to the max-tech level (particularly in cases where the max-
tech level exceeds the maximum efficiency level currently available on 
the market).
    In this proposed rulemaking, DOE relied on an efficiency-level 
approach, supplemented with reverse-engineering. This approach involved 
testing and physically disassembling a representative sample of 
commercially available products, reviewing publicly available cost 
information, and modeling equipment cost. From this information, DOE 
estimated the manufacturer production costs (``MPCs'') for a range of 
products currently available on the market, considering the design 
options and the steps manufacturers would likely take to reach a 
certain efficiency level. As part of this NOPR analysis, DOE included 
additional test units beyond those considered in the preliminary 
analysis as part of its updated test sample. The additional test units 
were included to represent additional baseline models, newly introduced 
units on the market, units with unique configurations, and units with 
technologies that were not available at the time of the preliminary 
analysis. The efficiency levels analyzed as part of this engineering 
analysis are attainable using commercially available clothes dryer 
technologies, or technologies that have been demonstrated in working 
prototypes.
a. Baseline Efficiency Levels
    For each product class, DOE generally selects a baseline model as a 
reference point for each class, and measures changes resulting from 
potential energy conservation standards against the baseline. The 
baseline model in each product class represents the characteristics of 
a product typical of that class. Generally, a baseline model is one 
that just meets current energy conservation standards, or, if no 
standards are in place, the baseline is typically the most common or 
least efficient unit on the market.
    The baseline clothes dryer efficiency levels for this NOPR differ 
from the existing energy conservation standards that were established 
in the 2011 rulemaking analysis primarily due to the difference between 
the then-current appendix D1, which DOE used to evaluate products in 
the previous rulemaking, and the present version of appendix D2, as 
established by the October 2021 TP Final Rule and which DOE used as the 
basis for this analysis. Appendix D2 includes test methods that more 
accurately measure the effects of automatic cycle termination and that 
may result in differences in the total measured energy consumption of 
the test cycle as compared to the test methods in appendix D1. 
Specifically, for automatic termination control dryers, appendix D2 
requires a lower FMC of the test load and does not rely on a field use 
factor to account for the over drying energy consumption, instead 
requiring that the automatic termination drying program run to the end 
of the cycle. Additionally, appendix D2 contains instructions for the 
testing of timer dryers, which include a lower FMC of the test load as 
compared to the version of appendix D1 used for the 2011 rulemaking 
analysis.
    For the engineering analysis, DOE begins the engineering analysis 
by identifying the efficiency level corresponding to the Federal 
minimum energy conservation standards for each product class. Due to 
the test procedure changes adopted in the October 2021 Final Rule, DOE 
determined the baseline efficiency level representative of minimally 
compliant products when tested under appendix D2. In order to identify 
the appendix D2 baseline levels, DOE tested 22 models that were 
certified as minimally compliant with the current energy conservation 
standards, from across all product classes. Because certified 
performance data are not available for models on the market as tested 
in accordance with both appendix D1 and appendix D2, DOE tested each 
basic model in its test sample in accordance with appendix D1 and 
appendix D2 and used the test values for appendix D2 to determine the 
baseline models in support of this engineering analysis. Due to the 
differences in the two test procedures described above, the baseline 
CEFD2 measured using appendix D2 is numerically lower for 
each product class than the corresponding CEFD1 value in the 
current energy conservation standards, though that does not indicate a 
lower efficiency. The test procedure differences are driving the lower 
baseline CEFD2 values and do not represent a lower 
efficiency or backsliding.
    The consumer clothes dryer baseline efficiency levels for the 
preliminary analysis are presented in Table IV.6.

    Table IV.6--Preliminary Analysis Consumer Clothes Dryer Baseline
                            Efficiency Levels
------------------------------------------------------------------------
                                                          CEFD2 (lb/kWh)
                      Product class
------------------------------------------------------------------------
Vented Electric, Standard (4.4 ft\3\ or greater                     2.20
 capacity)..............................................
Vented Electric, Compact (120V) (less than 4.4 ft\3\                2.42
 capacity)..............................................
Vented Electric, Compact (240V) (less than 4.4 ft\3\                2.00
 capacity)..............................................
Vented Gas, Standard (4.4 cubic ft\3\ or greater                    2.63
 capacity)..............................................
Vented Gas, Compact (less than 4.4 ft\3\ capacity)......            1.66
Ventless Electric, Compact (240V) (less than 4.4 ft\3\              2.03
 capacity)..............................................
Ventless Electric, Standard ((4.4 ft\3\ or greater                  2.23
 capacity)..............................................
Ventless Electric, Combination Washer-Dryer.............            2.27
------------------------------------------------------------------------


[[Page 51754]]

    In response to the preliminary analysis, AHAM agreed that testing 
was appropriate to determine the baseline and incremental efficiency 
levels, but stated that the testing of 18 models was insufficient to 
establish the baseline efficiency levels. AHAM also stated that basing 
DOE's analysis on a few baseline units may not accurately represent the 
market, especially when so many baseline models have electromechanical 
controls. AHAM therefore requested that DOE make its test results 
available so that representativeness could be assessed from a shipments 
perspective, and so that manufacturers could evaluate the test results 
for their models and compare to their own results. (AHAM, No. 23 at p. 
3)
    Upon request, DOE provided to individual manufacturers the test 
data for any of their units which were included in DOE's testing 
sample, otherwise maintaining confidentiality of the products tested. 
DOE also increased the number of units included in its updated test 
sample to better represent consumer clothes dryers currently available 
on the market, as discussed in chapter 5 of the NOPR TSD.
    The California IOUs recommended that DOE revise the engineering 
analysis and investigate lowering the baseline efficiency of the vented 
gas standard dryer product class. According to the California IOUs, 
their testing data that were presented to DOE in response to the test 
procedure NOPR that was published on July 23, 2019 (84 FR 35484), 
support the baseline efficiency level for the vented electric standard 
product class. However, for the vented gas standard product class, the 
California IOUs referred to a currently available product with a 
CEFD2 value below the baseline efficiency level presented in 
the preliminary TSD. NEEA asserted that DOE has historically set 
standard levels for gas clothes dryers lower than the standards for 
electric clothes dryers because some energy counted in the higher 
heating value of the gas consumed, which is the basis of the 
CEFD2, is not used by the consumer clothes dryer. NEEA 
encouraged DOE to re-evaluate the CEFD2 levels of electric 
and gas clothes dryers in its engineering analysis, as it pointed out 
that the electric clothes dryer efficiency levels are lower than the 
efficiency levels for gas clothes dryers that incorporate similar 
technology options. NEEA encouraged DOE to increase the stringency of 
the electric clothes dryer efficiency levels. (California IOUs, No. 26 
at pp. 1-3; NEEA, No. 30 at pp. 13-14)
    Additionally, NEEA submitted test data for 41 standard size 
electric and gas clothes dryers, which suggested that the average 
CEFD2 values for the non-ENERGY STAR-qualified electric and 
gas clothes dryers in its sample were significantly higher than the 
baseline efficiency levels in the preliminary analysis. NEEA also found 
that the least efficient electric clothes dryer in its sample had a 
measured CEFD2 that was more than 20 percent higher than 
DOE's value for electromechanically controlled consumer clothes dryers. 
NEEA encouraged DOE to use these data in developing appropriate 
efficiency levels for the engineering analysis. (NEEA, No. 30 at pp. 8-
10)
    DOE appreciates the data provided by NEEA and observes that, in 
general, the data support the historical trend regarding the lower 
efficiency of gas clothes dryers in comparison to electric clothes 
dryers. These data also support the updated baseline and incremental 
efficiency levels for gas clothes dryers, that latter of which are 
discussed in more detail in section IV.C.1.b of this document. Although 
the results of NEEA's test sample exhibit a higher average efficiency 
among baseline electromechanically controlled electric clothes dryers, 
as stated above, DOE set the baseline efficiency levels so that they 
would represent a minimally compliant, basic-construction consumer 
clothes dryer on the market. Accordingly, DOE has updated the baseline 
value for each product class to be equal to the minimum 
CEFD2, measured using appendix D2, among the corresponding 
consumer clothes dryers in its NOPR test sample.
    Similarly, DOE notes that the baseline efficiency level for the 
vented electric compact (120V) product class has been updated to 
reflect the CEFD2 value using the appendix D2 test procedure 
based on the best available data at this time.
    Finally, DOE has considered the revised product classes proposed in 
this NOPR analysis in updating the baseline efficiency levels, based on 
further analysis of results and new testing since the preliminary 
analysis. The baseline efficiency levels considered for this NOPR 
analysis are presented along with the current standards in Table IV.7 
and are discussed in more detail in chapter 5 of the NOPR TSD.

    Table IV.7--Notice of Proposed Rulemaking Consumer Clothes Dryer
                       Baseline Efficiency Levels
------------------------------------------------------------------------
                                          CEFD1 (lb/kWh)  CEFD2 (lb/kWh)
              Product class                                      *
------------------------------------------------------------------------
Electric, Standard (4.4 ft\3\ or greater            3.73            2.20
 capacity)..............................
Electric, Compact (120V) (less than 4.4             3.61            2.36
 ft\3\ capacity)........................
Vented Electric, Compact (240V) (less               3.27            2.00
 than 4.4 ft\3\ capacity)...............
Vented Gas, Standard (4.4 cubic ft\3\ or            3.30            2.00
 greater capacity)......................
Vented Gas, Compact (less than 4.4 ft\3\            3.30         ** 1.66
 capacity)..............................
Ventless Electric, Compact (240V) (less             2.55            2.03
 than 4.4 ft\3\ capacity)...............
Ventless Electric, Combination Washer-              2.08            2.27
 Dryer..................................
------------------------------------------------------------------------
* As discussed above, the baseline CEFD2 values represent differences in
  test procedure between appendix D1 and appendix D2 and do not
  constitute backsliding.
** CEFD2 baseline efficiency levels as measured under the Appendix D2
  account for differences in the effectiveness of automatic cycle
  termination. Manufacturers implement automatic termination in a
  variety of ways, which will impact the representations as measured
  under Appendix D2 resulting in a range of possible CEFD2 values, as
  compared to the same CEFD1 values in the existing Federal standards.

b. Incremental Efficiency Levels
    DOE developed incremental efficiency levels by reviewing products 
currently available on the market and by testing and reverse 
engineering products in the DOE test sample in support of the NOPR. For 
each product class, DOE analyzed several efficiency levels and 
determined the incremental MPC at each of these levels. DOE initially 
reviewed data in DOE's CCD to evaluate the range of efficiencies for 
consumer clothes dryers currently available on the market.\28\ As 
discussed in chapter 5 of the NOPR TSD, non-ENERGY STAR-qualified 
products (generally units with lower rated efficiencies) are typically

[[Page 51755]]

tested using appendix D1, while ENERGY STAR-qualified products are 
required to be tested using appendix D2. As a result, DOE conducted 
testing on a representative sample of non-ENERGY STAR products using 
appendix D2 to determine appropriate initial incremental efficiency 
levels for each product class. DOE observed that while electronic 
controls are typically implemented with other design options in this 
NOPR analysis, the improved automatic termination precision offered by 
switching to electronic controls contributed significantly to an 
increase in efficiency. This efficiency gain informed the first 
incremental efficiency levels for most product classes and was noted 
simply as electronic controls in the design options listed in the 
following tables. The design options associated with higher efficiency 
levels were subsequently distinguished according to specific design 
options DOE found manufacturers used to meet these higher efficiencies. 
As part of DOE's analysis, the maximum available efficiency level is 
defined by the highest efficiency unit currently available on the 
market. DOE also defines a ``max-tech'' efficiency level to represent 
the maximum possible efficiency for a given product.
---------------------------------------------------------------------------

    \28\ DOE's Compliance Certification Database is available for 
review at www.regulations.doe.gov/certification-data/#q=Product_Group_s%3A*.
---------------------------------------------------------------------------

    The incremental efficiency levels developed in the preliminary 
analysis are presented in Table IV.8 through Table IV.15.

  Table IV.8--Preliminary Analysis: Vented Electric Standard Efficiency
                                 Levels
------------------------------------------------------------------------
                                                          CEFD2 (lb/kWh)
             Level                    Design option
------------------------------------------------------------------------
Baseline.......................  Baseline                           2.20
                                  (Electromechanical
                                  Controls).
1..............................  Baseline + Electronic              2.68
                                  Controls.
2..............................  EL1 + Optimized Heating            3.04
                                  System.
3..............................  EL2 + More Advanced                3.27
                                  Automatic Termination
                                  Control System.
4..............................  EL3 + Modulating (2-               3.93
                                  Stage) Heat.
5..............................  EL4 + Inlet Air Preheat            4.21
6..............................  Heat Pump Dryer (Max-              4.30
                                  Tech).
------------------------------------------------------------------------


    Table IV.9--Preliminary Analysis: Vented Electric Compact (120V)
                            Efficiency Levels
------------------------------------------------------------------------
                                                          CEFD2 (lb/kWh)
             Level                    Design option
------------------------------------------------------------------------
Baseline.......................  Baseline                           2.42
                                  (Electromechanical
                                  Controls).
1..............................  Baseline + Electronic              2.95
                                  Controls.
2..............................  EL1 + Optimized Heating            3.35
                                  System.
3..............................  EL2 + More Advanced                4.28
                                  Automatic Termination
                                  Control System.
4..............................  EL3 + Modulating (2-               4.33
                                  Stage) Heat.
5..............................  EL4 + Inlet Air Preheat            4.63
6..............................  Heat Pump Dryer (Max-              4.73
                                  Tech).
------------------------------------------------------------------------


    Table IV.10--Preliminary Analysis: Vented Electric Compact (240V)
                            Efficiency Levels
------------------------------------------------------------------------
                                                          CEFD2 (lb/kWh)
             Level                    Design option
------------------------------------------------------------------------
Baseline.......................  Baseline                           2.00
                                  (Electromechanical
                                  Controls).
1..............................  Baseline + Electronic              2.44
                                  Controls.
2..............................  EL1 + Optimized Heating            2.76
                                  System.
3..............................  EL2 + More Advanced                3.53
                                  Automatic Termination
                                  Control System.
4..............................  EL3 + Modulating (2-               3.57
                                  Stage) Heat.
5..............................  EL4 + Inlet Air Preheat            3.82
6..............................  Heat Pump Dryer (Max-              2.91
                                  Tech).
------------------------------------------------------------------------


Table IV.11--Preliminary Analysis: Vented Gas Standard Efficiency Levels
------------------------------------------------------------------------
                                                          CEFD2 (lb/kWh)
             Level                    Design option
------------------------------------------------------------------------
Baseline.......................  Baseline                           2.63
                                  (Electromechanical
                                  Controls).
1..............................  Baseline + Electronic              3.21
                                  Controls.
2..............................  EL1 + Optimized Heating            3.48
                                  System and More
                                  Advanced Automatic
                                  Termination Control
                                  System.
3..............................  EL2 + Modulating (2-               4.70
                                  Stage) Heat.
4..............................  EL3 + Inlet Air Preheat            5.04
                                  (Max-Tech).
------------------------------------------------------------------------


 Table IV.12--Preliminary Analysis: Vented Gas Compact Efficiency Levels
------------------------------------------------------------------------
                                                          CEFD2 (lb/kWh)
             Level                    Design option
------------------------------------------------------------------------
Baseline.......................  Baseline                           1.66
                                  (Electromechanical
                                  Controls).
1..............................  Baseline + Electronic              2.02
                                  Controls.
2..............................  EL1 + Optimized Heating            2.19
                                  System and More
                                  Advanced Automatic
                                  Termination Control
                                  System.

[[Page 51756]]

 
3..............................  EL2 + Modulating (2-               2.96
                                  Stage) Heat.
4..............................  EL3 + Inlet Air Preheat            3.17
                                  (Max-Tech).
------------------------------------------------------------------------


Table IV.13--Preliminary Analysis: Ventless Electric Standard Efficiency
                                 Levels
------------------------------------------------------------------------
                                                          CEFD2 (lb/kWh)
             Level                    Design option
------------------------------------------------------------------------
Baseline.......................  Baseline (Electronic               2.23
                                  Controls).
1..............................  Baseline + More                    2.95
                                  Advanced Automatic
                                  Termination Control
                                  System.
2..............................  Heat Pump Dryer (Max-              4.50
                                  Tech).
------------------------------------------------------------------------


   Table IV.14--Preliminary Analysis: Ventless Electric Compact (240V)
                            Efficiency Levels
------------------------------------------------------------------------
                                                          CEFD2 (lb/kWh)
             Level                    Design option
------------------------------------------------------------------------
Baseline.......................  Baseline (Electronic               2.03
                                  Controls).
1..............................  Baseline + More                    2.68
                                  Advanced Automatic
                                  Termination Control
                                  System.
2..............................  Heat Pump Dryer (Max-              5.70
                                  Tech).
------------------------------------------------------------------------


Table IV.15--Preliminary Analysis: Ventless Electric Combination Washer-
                         Dryer Efficiency Levels
------------------------------------------------------------------------
                                                          CEFD2 (lb/kWh)
             Level                    Design option
------------------------------------------------------------------------
Baseline.......................  Baseline (Electronic               2.27
                                  Controls).
1..............................  Baseline + High Speed              2.55
                                  Spin.
2..............................  Heat Pump Dryer (Max-              5.42
                                  Tech).
------------------------------------------------------------------------

    DOE received comments regarding the hybrid heat pump design 
investigated in a 2016 study by Pacific Northwest National Laboratory 
(``PNNL''), which utilizes a low-wattage electric resistance heater 
located downstream of the condenser to provide supplementary heating to 
minimize drying cycle time.\29\ ASAP and NRDC encouraged DOE to review 
the max-tech level and heat pump technology design option based on 
current hybrid heat pump models available and the PNNL prototype hybrid 
heat pump clothes dryer which utilized a recuperative heat exchanger in 
addition to a resistive heating element and heat pump design. (ASAP, 
NRDC, No. 25 at p. 2)
---------------------------------------------------------------------------

    \29\ See: www.pnnl.gov/main/publications/external/technical_reports/PNNL-25510.pdf.
---------------------------------------------------------------------------

    At the time of the preliminary analysis, DOE was not aware of the 
efficiency impacts associated with consumer clothes dryers utilizing a 
hybrid heat pump design and therefore did not include this design as 
part of the preliminary analysis. In the time since the publishing of 
the preliminary analysis, DOE has identified at least two manufacturers 
that market consumer clothes dryers utilizing a hybrid heat pump 
design. DOE investigated the efficiency savings associated with hybrid 
heat pump clothes dryers and included in its updated test sample two 
hybrid heat pump clothes dryers. DOE observed that, compared to heat 
pump-only clothes dryer designs, the hybrid heat pump clothes dryers 
had lower efficiencies, albeit higher than the efficiencies of any non-
heat pump clothes dryer. This analysis indicates that use of hybrid 
heat pump technology may provide a ``bridge'' in the market between 
consumer clothes dryer models utilizing conventional heating elements 
and models based on heat pump-only technology. Therefore, in this NOPR, 
DOE analyzed an intermediate efficiency level associated with the 
hybrid heat pump technology that would capture the efficiency savings 
from consumer clothes dryers implementing a conventional heating 
element in addition to heat pump technology. The efficiency savings 
associated with heat recovery are still captured in the efficiency 
levels modeling inlet air preheat.
    ASAP, NRDC, the California IOUs, and NEEA requested that DOE review 
the consumer clothes dryers currently available on the market, 
asserting that at the time of publication of the preliminary analysis, 
there were models available with higher efficiency than the preliminary 
max-tech levels in the ventless electric standard and compact product 
classes. (ASAP, NRDC, No. 25 at pp. 1-2; California IOUs, No. 26 at pp. 
3-4; NEEA, No. 30 at pp. 10-11) DOE reviewed the highest efficiency 
ventless clothes dryers on the market by examining DOE's Compliance 
Certification Management System database (``CCMS'') and ENERGY STAR 
databases and included a sample of them in the updated test sample to 
better represent the max-tech levels in the proposed electric standard, 
electric compact (120V), and ventless electric compact (240V) product 
classes.
    Chapter 5 of the NOPR TSD discusses the incremental efficiency 
levels for each of the product classes proposed in this NOPR analysis. 
The revised CEFD2 efficiency levels for each product class 
are shown below in Table IV.16 through Table IV.21, along with the 
current energy conservation standards in CEFD1 for 
comparison. As discussed in section IV.C.1.a of this document, the 
baseline CEFD2 values estimated for the preliminary analysis 
are lower than the current CEFD1 values in the energy 
conservation standards due to the differences in testing using appendix 
D1 and appendix D2. DOE requests

[[Page 51757]]

comment on the incremental efficiency levels used in the NOPR 
engineering analysis.
---------------------------------------------------------------------------

    \30\ DOE is aware of clothes dryers in the electric standard 
product class that perform at higher efficiencies than the proposed 
max-tech level, but those models are not representative of the 
typical capacity in the electric standard product class. Therefore, 
based on the certified performance of those models and additional 
investigative testing, DOE determined a representative max-tech 
efficiency for the electric standard product class that reflects an 
appropriate, representative unit capacity. See chapter 5 of the TSD 
for more information.

            Table IV.16--Notice of Proposed Rulemaking Analysis: Electric Standard Efficiency Levels
----------------------------------------------------------------------------------------------------------------
                                                                                      Current
                                                                                  standard CEFD1  NOPR CEFD2 (lb/
               Efficiency level                           Design option              (lb/kWh)         kWh) *
 
----------------------------------------------------------------------------------------------------------------
Baseline......................................  Baseline (Electromechanical                 3.73            2.20
                                                 Controls).
1.............................................  Baseline + Electronic Controls..  ..............            2.68
2.............................................  EL1 + Optimized Heating System..  ..............            3.04
3.............................................  EL2 + More Advanced Automatic     ..............            3.27
                                                 Termination Control System.
4.............................................  EL3 + Modulating (2-Stage) Heat.  ..............            3.93
5.............................................  EL4 + Inlet Air Preheat.........  ..............            4.21
6.............................................  Hybrid Heat Pump Dryer            ..............            5.20
                                                 (Additional Resistance Heater).
7.............................................  Heat Pump Dryer (Max-Tech)......  ..............       \30\ 7.39
----------------------------------------------------------------------------------------------------------------
* As discussed above, the baseline CEFD2 values represent differences in test procedure between Appendix D1 and
  Appendix D2 and do not constitute backsliding.


         Table IV.17--Notice of Proposed Rulemaking Analysis: Electric Compact (120V) Efficiency Levels
----------------------------------------------------------------------------------------------------------------
                                                                                      Current
                                                                                  standard CEFD1  NOPR CEFD2 (lb/
               Efficiency level                           Design option              (lb/kWh)          kWh)
 
----------------------------------------------------------------------------------------------------------------
Baseline......................................  Baseline (Electromechanical                 3.61            2.36
                                                 Controls).
1.............................................  Baseline + Electronic Controls..  ..............            3.15
2.............................................  EL1 + Optimized Heating System..  ..............            3.35
3.............................................  EL2 + More Advanced Automatic     ..............            4.28
                                                 Termination Control System.
4.............................................  EL3 + Modulating (2-Stage) Heat.  ..............            4.33
5.............................................  EL4 + Inlet Air Preheat.........  ..............            4.63
6.............................................  Heat Pump Dryer (Max-Tech)......  ..............            6.37
----------------------------------------------------------------------------------------------------------------


      Table IV.18--Notice of Proposed Rulemaking Analysis: Vented Electric Compact (240V) Efficiency Levels
----------------------------------------------------------------------------------------------------------------
                                                                                      Current
                                                                                  standard CEFD1  NOPR CEFD2 (lb/
               Efficiency level                           Design option              (lb/kWh)          kWh)
 
----------------------------------------------------------------------------------------------------------------
Baseline......................................  Baseline (Electromechanical                 3.27            2.00
                                                 Controls).
1.............................................  Baseline + Electronic Controls..  ..............            2.44
2.............................................  EL1 + Optimized Heating System..  ..............            2.76
3.............................................  EL2 + More Advanced Automatic     ..............            3.30
                                                 Termination Control System.
4.............................................  EL3 + Modulating (2-Stage) Heat.  ..............            3.57
5.............................................  EL4 + Inlet Air Preheat.........  ..............            3.82
6.............................................  Heat Pump Dryer (Max-Tech)......  ..............            3.91
----------------------------------------------------------------------------------------------------------------


     Table IV.19--Notice of Proposed Rulemaking Analysis: Vented Gas Standard and Compact Efficiency Levels
----------------------------------------------------------------------------------------------------------------
                                                                      Current           NOPR CEFD2 (lb/kWh)
                                                                  standard CEFD1 -------------------------------
           Efficiency level                   Design option        (lb/kWh) \31\    Vented gas      Vented gas
                                                                                     standard         compact
----------------------------------------------------------------------------------------------------------------
Baseline..............................  Baseline                            3.30            2.00            1.66
                                         (Electromechanical
                                         Controls).
1.....................................  Baseline + Electronic     ..............            2.44            2.02
                                         Controls.
2.....................................  EL1 + Optimized Heating   ..............            3.00            2.49
                                         System and More
                                         Advanced Automatic
                                         Termination Control
                                         System.
3.....................................  EL2 + Modulating (2-      ..............            3.48            2.89
                                         Stage) Heat.
4.....................................  EL3 + Inlet Air Preheat   ..............            3.83            3.17
                                         (Max-Tech).
----------------------------------------------------------------------------------------------------------------


[[Page 51758]]

     
---------------------------------------------------------------------------

    \31\ The current standard does not distinguish a separate 
product class for compact sized gas consumer clothes dryers. As 
such, the current standard may apply to all gas consumer clothes 
dryers.

     Table IV.20--Notice of Proposed Rulemaking Analysis: Ventless Electric Compact (240V) Efficiency Levels
----------------------------------------------------------------------------------------------------------------
                                                                                      Current
                                                                                  standard CEFD1  NOPR CEFD2 (lb/
               Efficiency level                           Design option              (lb/kWh)          kWh)
 
----------------------------------------------------------------------------------------------------------------
Baseline......................................  Baseline (Electronic Controls)..            2.55            2.03
1.............................................  Baseline + More Advanced          ..............            2.68
                                                 Automatic Termination Control
                                                 System.
2.............................................  Heat Pump Dryer (Max-Tech)......  ..............            6.80
----------------------------------------------------------------------------------------------------------------


   Table IV.21--Notice of Proposed Rulemaking Analysis: Ventless Electric Combination Washer-Dryer Efficiency
                                                     Levels
----------------------------------------------------------------------------------------------------------------
                                                                                      Current
                                                                                  standard CEFD1  NOPR CEFD2 (lb/
               Efficiency level                           Design option              (lb/kWh)          kWh)
 
----------------------------------------------------------------------------------------------------------------
Baseline......................................  Baseline (Electronic Controls)..            2.08            2.27
1.............................................  Baseline + High Speed Spin......  ..............            2.55
2.............................................  Heat Pump Dryer (Max-Tech)......  ..............            4.01
----------------------------------------------------------------------------------------------------------------

2. Cost Analysis
    The cost analysis portion of the engineering analysis is conducted 
using one or a combination of cost approaches. The selection of cost 
approach depends on a suite of factors, including the availability and 
reliability of public information, characteristics of the regulated 
product, the availability and timeliness of purchasing the product on 
the market. The cost approaches are summarized as follows:
     Physical teardowns: Under this approach, DOE physically 
dismantles a commercially available product, component-by-component, to 
develop a detailed bill of materials (``BOM'') for the product.
     Catalog teardowns: In lieu of physically deconstructing a 
product, DOE identifies each component using parts diagrams (available 
from manufacturer websites or appliance repair websites, for example) 
to develop the BOM for the product.
     Price surveys: If neither a physical nor catalog teardown 
is feasible (for example, for tightly integrated products such as 
fluorescent lamps, which are infeasible to disassemble and for which 
parts diagrams are unavailable) or cost-prohibitive and otherwise 
impractical (e.g. large commercial boilers), DOE conducts price surveys 
using publicly available pricing data published on major online 
retailer websites and/or by soliciting prices from distributors and 
other commercial channels.
    In the present case, DOE conducted the analysis using physical 
product teardowns to determine the baseline MPC for each product class 
as outlined in chapter 5 of the NOPR TSD. DOE developed the cost-
efficiency relationships for each product class as discussed in section 
IV.C.3 of this document. DOE developed incremental MPCs based on 
product teardowns and manufacturing cost modeling of the expected 
design changes at each efficiency level. DOE observed that the basic 
product designs of vented electric and vented gas clothes dryers are 
similar except for the heating system. DOE also observed that the 
technology designs of standard size and compact size clothes dryers are 
similar as well, simply scaled in size. As a result, in the absence of 
models available on the market at certain efficiency levels for certain 
product classes, DOE estimated the incremental MPC for these based on 
the same design changes observed for the electric standard product 
class. DOE updated the cost-efficiency analysis from the preliminary 
analysis by updating the costs of raw materials and purchased 
components, as well as updating costs for manufacturing equipment, 
labor, and depreciation. DOE also used information from teardown of 
units in the updated test sample to inform updates to the cost-
efficiency analysis. Not all units in the updated test sample were torn 
down; DOE focused on units recently introduced in the market, units 
with unique configuration, and units with technologies that were not 
available at the time of the preliminary analysis to better inform the 
costs associated with particular product classes and design options. 
The resulting BOMs provided the basis for the MPC estimates in this 
NOPR. The baseline MPCs for each consumer clothes dryer product class 
are listed in Table IV.22, with all costs presented in 2020 dollars. 
DOE requests comment on the baseline MPCs in the NOPR engineering 
analysis.

   Table IV.22--Notice of Proposed Rulemaking: Consumer Clothes Dryer
                 Baseline Manufacturing Production Costs
------------------------------------------------------------------------
                                                           Baseline MPC
                      Product class                           (2020$)
------------------------------------------------------------------------
1. Electric, Standard (4.4 cubic feet (ft\3\) or greater         $250.65
 capacity)..............................................
2. Electric, Compact (120 volts (V)) (less than 4.4               267.09
 ft\3\ capacity)........................................
3. Vented Electric, Compact (240V) (less than 4.4 ft\3\           267.68
 capacity)..............................................
4. Gas, Standard (4.4 cubic ft\3\ or greater capacity)..          284.33
5. Gas, Compact (less than 4.4 ft\3\ capacity)..........          309.82

[[Page 51759]]

 
6. Ventless Electric, Compact (240V) (less than 4.4               464.90
 ft\3\ capacity)........................................
7. Electric, Combination Washer-Dryer...................          629.65
------------------------------------------------------------------------

    The following section presents the incremental MPCs for each 
consumer clothes dryer product class.
3. Cost-Efficiency Results
    The results of the engineering analysis are presented as cost-
efficiency data for each of the efficiency levels for each of the 
product classes that were analyzed, as well as those extrapolated from 
a product class with similar features. DOE developed estimates of MPCs 
for each unit in the teardown sample to develop a comprehensive set of 
incremental MPCs (i.e., the additional costs manufacturers would likely 
incur by producing consumer clothes dryers at each efficiency level 
compared to the baseline).
    In response to the MPCs presented in the preliminary analysis, AHAM 
stated that due to unprecedented supply chain issues facing home 
appliance manufacturers resulting from the COVID-19 pandemic and 
increased tariffs on raw materials, components, and finished goods, DOE 
must take into account these challenges if it is to consider amending 
energy conservation standards. AHAM stated it is working to collect 
data on the impact of supply chain challenges and would be willing to 
share that data with DOE. (AHAM, No. 23 at p. 9) DOE also received 
similar feedback from manufacturers during the interview process. DOE 
notes that increased costs associated with recent supply chain issues 
have been implemented in the cost analysis and are presented in the 
MPCs in this NOPR analysis, specifically by way of 5-year moving 
averages for material and purchase parts prices.
    The resulting incremental MPCs from this NOPR analysis are provided 
in Table IV.23 through Table IV.29. See chapter 5 of the NOPR TSD for 
additional detail on the engineering analysis. DOE requests comment on 
the incremental MPCs from the NOPR engineering analysis, as well as any 
data on the impact of supply chain challenges that could better inform 
the cost analysis.

 Table IV.23--Notice of Proposed Rulemaking Analysis: Electric Standard
               Incremental Manufacturing Production Costs
------------------------------------------------------------------------
                                                            Incremental
        Efficiency level              Design option         MPC (2020$)
------------------------------------------------------------------------
Baseline.......................  Baseline                 ..............
                                  (Electromechanical
                                  Controls).
1..............................  Baseline + Electronic            $11.02
                                  Controls.
2..............................  EL1 + Optimized Heating           13.70
                                  System.
3..............................  EL2 + More Advanced               16.59
                                  Automatic Termination
                                  Control System.
4..............................  EL3 + Modulating (2-              21.00
                                  Stage) Heat.
5..............................  EL4 + Inlet Air Preheat           70.51
6..............................  Hybrid Heat Pump Dryer           226.18
                                  (Additional Resistive
                                  Heater).
7..............................  Heat Pump Dryer (Max-            239.46
                                  Tech).
------------------------------------------------------------------------


  Table IV.24--Notice of Proposed Rulemaking Analysis: Electric Compact
            (120V) Incremental Manufacturing Production Costs
------------------------------------------------------------------------
                                                            Incremental
        Efficiency level              Design option         MPC (2020$)
------------------------------------------------------------------------
Baseline.......................  Baseline                 ..............
                                  (Electromechanical
                                  Controls).
1..............................  Baseline + Electronic            $13.43
                                  Controls.
2..............................  EL1 + Optimized Heating           17.76
                                  System.
3..............................  EL2 + More Advanced               21.40
                                  Automatic Termination
                                  Control System.
4..............................  EL3 + Modulating (2-              26.32
                                  Stage) Heat.
5..............................  EL4 + Inlet Air Preheat           83.07
6..............................  Heat Pump Dryer (Max-            220.29
                                  Tech).
------------------------------------------------------------------------


  Table IV.25--Notice of Proposed Rulemaking Analysis: Vented Electric
        Compact (240V) Incremental Manufacturing Production Costs
------------------------------------------------------------------------
                                                            Incremental
        Efficiency level              Design option         MPC (2020$)
------------------------------------------------------------------------
Baseline.......................  Baseline                 ..............
                                  (Electromechanical
                                  Controls).
1..............................  Baseline + Electronic            $13.99
                                  Controls.
2..............................  EL1 + Optimized Heating           18.31
                                  System.

[[Page 51760]]

 
3..............................  EL2 + More Advanced               21.97
                                  Automatic Termination
                                  Control System.
4..............................  EL3 + Modulating (2-              26.88
                                  Stage) Heat.
5..............................  EL4 + Inlet Air Preheat           83.63
6..............................  Heat Pump Dryer (Max-            220.84
                                  Tech).
------------------------------------------------------------------------


Table IV.26--Notice of Proposed Rulemaking Analysis: Vented Gas Standard
               Incremental Manufacturing Production Costs
------------------------------------------------------------------------
                                                            Incremental
        Efficiency level              Design option         MPC (2020$)
------------------------------------------------------------------------
Baseline.......................  Baseline                 ..............
                                  (Electromechanical
                                  Controls).
1..............................  Baseline + Electronic            $14.50
                                  Controls.
2..............................  EL1 + Optimized Heating           17.46
                                  System and More
                                  Advanced Automatic
                                  Termination Control
                                  System.
3..............................  EL2 + Modulating (2-              26.75
                                  Stage) Heat.
4..............................  EL3 + Inlet Air Preheat           76.25
                                  (Max-Tech).
------------------------------------------------------------------------


 Table IV.27--Notice of Proposed Rulemaking Analysis: Vented Gas Compact
               Incremental Manufacturing Production Costs
------------------------------------------------------------------------
                                                            Incremental
        Efficiency level              Design option         MPC (2020$)
------------------------------------------------------------------------
Baseline.......................  Baseline                 ..............
                                  (Electromechanical
                                  Controls).
1..............................  Baseline + Electronic            $12.32
                                  Controls.
2..............................  EL1 + Optimized Heating           16.49
                                  System and More
                                  Advanced Automatic
                                  Termination Control
                                  System.
3..............................  EL2 + Modulating (2-              26.97
                                  Stage) Heat.
4..............................  EL3 + Inlet Air Preheat           83.72
                                  (Max-Tech).
------------------------------------------------------------------------


 Table IV.28--Notice of Proposed Rulemaking Analysis: Ventless Electric
        Compact (240V) Incremental Manufacturing Production Costs
------------------------------------------------------------------------
                                                            Incremental
        Efficiency level              Design option         MPC (2020$)
------------------------------------------------------------------------
Baseline.......................  Baseline (Electronic     ..............
                                  Controls).
1..............................  Baseline + More                   $3.01
                                  Advanced Automatic
                                  Termination Control
                                  System.
2..............................  Heat Pump Dryer (Max-            184.11
                                  Tech).
------------------------------------------------------------------------


 Table IV.29--Notice of Proposed Rulemaking Analysis: Ventless Electric
   Combination Washer-Dryer Incremental Manufacturing Production Costs
------------------------------------------------------------------------
                                                            Incremental
        Efficiency level              Design option         MPC (2020$)
------------------------------------------------------------------------
Baseline.......................  Baseline (Electronic     ..............
                                  Controls).
1..............................  Baseline + High Speed             $0.00
                                  Spin.
2..............................  Heat Pump Dryer (Max-            383.58
                                  Tech).
------------------------------------------------------------------------

D. Markups Analysis

    The markups analysis develops appropriate markups (e.g., retailer 
markups, distributor markups, contractor markups) in the distribution 
chain and sales taxes to convert the manufacturer selling price 
(``MSP'') estimates derived in the engineering analysis to consumer 
prices, which are then used in the LCC and PBP analysis. At each step 
in the distribution channel, companies mark up the price of the product 
to cover costs.
    Before developing mark-ups, DOE defines key market participants and 
identifies distribution channels.
    For consumer clothes dryers, the main parties in the distribution 
chain are retailers.
    DOE developed baseline and incremental markups for each actor in 
the distribution chain. Baseline markups are applied to the price of 
products with baseline efficiency, while incremental markups are 
applied to the

[[Page 51761]]

difference in price between baseline and higher-efficiency models (the 
incremental cost increase). The incremental markup is typically less 
than the baseline markup and is designed to maintain similar per-unit 
operating costs before and after new or amended standards.\32\
---------------------------------------------------------------------------

    \32\ Because the projected price of standards-compliant products 
is typically higher than the price of baseline products, using the 
same markup for the incremental cost and the baseline cost would 
result in higher per-unit operating profit. While such an outcome is 
possible, DOE maintains that in markets that are reasonably 
competitive it is unlikely that standards would lead to a 
sustainable increase in profitability in the long run.
---------------------------------------------------------------------------

    DOE relied on economic data from the U.S. Census Bureau to estimate 
average baseline and incremental markups. Specifically, DOE used the 
2017 Annual Retail Trade Survey for the ``electronics and appliance 
stores'' sector to develop retailer markups; \33\ and the 2017 Annual 
Wholesale Trade Survey for the ``household appliances, and electrical 
and electronic goods merchant wholesalers'' to estimate wholesaler 
markups.\34\
---------------------------------------------------------------------------

    \33\ US Census Bureau, Annual Retail Trade Survey. 2017. 
Available at www.census.gov/programs-surveys/arts.html (last 
accessed November 17, 2021).
    \34\ US Census Bureau, Annual Wholesale Trade Survey. 2017. 
Available at www.census.gov/awts (last accessed November 17, 2021).
---------------------------------------------------------------------------

    Chapter 6 of the NOPR TSD provides details on DOE's development of 
markups for consumer clothes dryers.

E. Energy Use Analysis

    The purpose of the energy use analysis is to determine the annual 
energy consumption of consumer clothes dryers at different efficiencies 
in representative U.S. single-family homes, multi-family residences, 
and mobile homes, and to assess the energy savings potential of 
increased consumer clothes dryer efficiency. The energy use analysis 
estimates the range of energy use of consumer clothes dryers in the 
field (i.e., as they are actually used by consumers). The energy use 
analysis provides the basis for other analyses DOE performed, 
particularly assessments of the energy savings and the savings in 
consumer operating costs that could result from adoption of amended or 
new standards.
    To establish a reasonable range of energy consumption in the field 
for consumer clothes dryers, DOE primarily used data from the EIA's 
2015 Residential Energy Consumption Survey (``2015 RECS'').\35\ 2015 
RECS collected data on 5,686 housing units and was constructed by EIA 
to be a national representation of the household population in the 
United States. DOE developed household samples from 2015 RECS.\36\
---------------------------------------------------------------------------

    \35\ U.S. Department of Energy--Energy Information 
Administration, Residential Energy Consumption Survey: 2015 Public 
Use Data Files. Available at www.eia.doe.gov/emeu/recs/recspubuse15/pubuse15.html (last accessed November 18, 2021).
    \36\ Microdata of 2020 RECS, which contains household samples, 
was released in July 2022. Hence it was not available at the time 
the NOPR analysis was conducted. However, DOE plans to use 2020 RECS 
for the Final Rule analysis.
---------------------------------------------------------------------------

    DOE divided the sample of households into four sub-samples to 
characterize the product classes being analyzed: standard or compact 
clothes dryer using electricity or natural gas as the clothes dryer 
fuel. For compact clothes dryers, DOE developed a sub-sample consisting 
of households with an electric or gas clothes dryer in multifamily 
buildings, manufactured homes, and single-family homes with less than 
1,000 square feet and no garage or basement, since these products are 
most likely to be found in these housing types.
    The energy use analysis requires DOE to establish a range of total 
annual usage (number of cycles) in order to estimate annual energy 
consumption by a clothes dryer. DOE estimated the number of clothes 
dryer cycles per year for each sample household using data given by 
2015 RECS on the number of laundry loads washed (clothes washer cycles) 
per week and the frequency of clothes dryer use.
    AHAM agreed with DOE's use of the 2015 RECS to establish the annual 
number of cycles for clothes dryers along with other available 
national, statistically significant field use data that may be 
available. (AHAM, No. 23 at pp. 10-11) In contrast, NEEA encouraged DOE 
to increase the number of annual dryer cycles in its energy analysis or 
conduct its own field study to more accurately determine this value. 
NEEA found that the RECS estimate of 243 dryer cycles per year was 
significantly lower than its own RBSA Laundry Study, which found 311 +/
-42 loads per year for the same group of products, which was based on 
metering of dryers in the field. NEEA also indicated that the RECS 
methodology is subject to recall bias and may not be an accurate 
representation of consumer use. (NEEA, No. 30 at pp. 14-15; Webinar 
Transcript, No. 22 at pp. 41-42) ASAP and NRDC encouraged DOE to 
consider data from the NEEA 2014 Field Study in estimating the number 
of dryer loads per year. (ASAP, NRDC, No. 25 at p. 2)
    The RBSA study includes sample households from three states in the 
U.S. Northwest. Since sample households in 2015 RECS are nationally 
representative, it is more accurate to use in the analysis.
    GEA stated that DOE must consider product performance to prevent 
consumer usage with unintended energy consumption consequences, stating 
that long cycle times may lead to re-washing or re-drying of clothes. 
(GEA, No. 28 at pp. 2-3)
    For this analysis, DOE did not find any studies supporting or 
indicating an increased usage resulting from cycle times. DOE will 
consider any new information or data that points to an impact on usage 
due to a change in cycle times. The California IOUs suggested that 
updated RECS data be utilized for the final rule analysis. (CA IOUs, 
No. 26 at p. 6) Data collection for the 2020 RECS are in progress but 
it is unclear if the data needed to estimate clothes dryer cycles will 
be available for the final rule analysis.
    The California IOUs recommended DOE consider the impact of the 
COVID-19 pandemic has had as updates are made. The California IOUs 
encouraged DOE to consider carefully what portions of updated RECS data 
are representative of current and future use as the updated data may 
have heavy influences from the COVID-19 pandemic. (CA IOUs, No. 26 at 
p. 6) Energy Solutions also requested that DOE consider how consumer 
usage has shifted due to the COVID-19 pandemic. (Webinar Transcript, 
No. 22 at p. 66)
    If appropriate data from the 2020 RECS are available for the final 
rule analysis, DOE will evaluate the extent to which the data may have 
been affected by changes in dryer usage due to the pandemic.
    For each considered efficiency level, DOE derived the field energy 
use by separately estimating the active mode and standby mode energy 
use and then adding them together. The per-cycle active mode energy 
consumption is estimated using the DOE clothes dryer test procedure at 
appendix D2. It can be back-calculated from the test procedure results 
by dividing the weight (lb) of clothes dried per cycle (8.45 lb for 
standard and 3 lb for compact clothes dryers) by the CEFD2 
(lb/kWh) and subtracting standby power. DOE adjusted the test procedure 
energy use to reflect field conditions by making an adjustment for 
clothes dryer load weight and moisture removal factor. Chapter 7 of the 
NOPR TSD provides more detail about these calculations.
    DOE also considered the impact of clothes dryer operation on home 
heating and cooling loads. A clothes dryer releases heat to the 
surrounding environment. If the clothes dryer is located indoors, its 
use will tend to

[[Page 51762]]

slightly reduce the heating load during the heating season and slightly 
increase the cooling load during the cooling season. To calculate this 
impact, DOE first estimated whether the clothes dryer in a RECS sample 
home is located in conditioned space (referred to as indoors) or in 
unconditioned space (such as garages, unconditioned basements, outdoor 
utility closets, or attics). Based on the 2015 RECS and the 2015 
American Housing Survey (``AHS''),\37\ DOE assumed that 50 percent of 
vented standard electric and gas clothes dryers are located indoors, 
while 100 percent of compact and ventless clothes dryers are located 
indoors. For these installations, DOE utilized the results from a 
European Union study about the impacts of clothes dryers on home 
heating and cooling loads to determine the appropriate factor to apply 
to the total clothes dryer energy use.\38\ This study reported that for 
vented clothes dryers there is a factor of negative 3 to 9 percent 
(average 6 percent), and for ventless clothes dryers there is a factor 
of positive 7 to 15 percent (average 11 percent).\39\ This effect is 
likely to be approximately the same for all of the considered 
efficiency levels because the amount of air passing through the clothes 
dryer does not vary.
---------------------------------------------------------------------------

    \37\ U.S. Census Bureau: Housing and Household Economic 
Statistics Division, American Housing Survey National Data. 2015, 
HUD. Available at www.census.gov/programs-surveys/ahs/data.2015.html 
(last accessed November 29, 2021).
    \38\ R[uuml]denauer, I. and C.-O. Gensch, Energy demand of 
tumble dryers with respect to differences in technology and ambient 
conditions, January 13, 2004. European Committee of Domestic 
Equipment Manufacturers (CECED).
    \39\ For units that are located in conditioned space, a negative 
factor for vented consumer clothes dryers translates to a penalty in 
energy use whereas a positive factor for ventless consumer clothes 
dryers translates to a credit in energy use. For details of the 
calculations see the R[uuml]denauer, I. and C.-O. Gensch study 
referenced above.
---------------------------------------------------------------------------

    ASAP and NRDC requested that DOE confirm the baseline annual energy 
use for ventless electric standard dryers, pointing out that while 
baseline CEFD2 values for vented and ventless models are 
almost identical, the baseline annual energy consumption for ventless 
models is almost three times smaller than that for vented models. 
(ASAP, NRDC, No. 25 at pp. 2-3; ASAP, No. 22 at p. 40)
    The difference in energy use between vented and ventless models is 
a function of dryer usage, efficiency, and additional impacts on 
heating and cooling loads from operating a dryer. DOE has since updated 
its product classes for electric standard dryers and the update removes 
the distinction between ventless and vented product classes in this 
NOPR. DOE proposes an ``Electric Standard'' product class containing 
both the vented electric standard product class and the ventless 
electric standard product class analyzed in the preliminary analysis. 
See the discussion of product classes in section IV.A.1 of this 
document.
    Chapter 7 of the NOPR TSD provides details on DOE's energy use 
analysis for consumer clothes dryers.

F. Life-Cycle Cost and Payback Period Analysis

    DOE conducted LCC and PBP analyses to evaluate the economic impacts 
on individual consumers of potential energy conservation standards for 
consumer clothes dryers. The effect of new or amended energy 
conservation standards on individual consumers usually involves a 
reduction in operating cost and an increase in purchase cost. DOE used 
the following two metrics to measure consumer impacts:
    (1) The LCC is the total consumer expense of an appliance or 
product over the life of that product, consisting of total installed 
cost (manufacturer selling price, distribution chain markups, sales 
tax, and installation costs) plus operating costs (expenses for energy 
use, maintenance, and repair). To compute the operating costs, DOE 
discounts future operating costs to the time of purchase and sums them 
over the lifetime of the product.
    (2) The PBP is the estimated amount of time (in years) it takes 
consumers to recover the increased purchase cost (including 
installation) of a more-efficient product through lower operating 
costs. DOE calculates the PBP by dividing the change in purchase cost 
at higher efficiency levels by the change in annual operating cost for 
the year that amended or new standards are assumed to take effect.
    For any given efficiency level, DOE measures the change in LCC 
relative to the LCC in the no-new-standards case, which reflects the 
estimated efficiency distribution of consumer clothes dryers in the 
absence of new or amended energy conservation standards. In contrast, 
the PBP for a given efficiency level is measured relative to the 
baseline product.
    For each considered efficiency level in each product class, DOE 
calculated the LCC and PBP for a nationally representative set of 
housing units. As stated previously, DOE developed household samples 
from the 2015 RECS.\40\ For each sample household, DOE determined the 
energy consumption for the consumer clothes dryers and the appropriate 
energy price. By developing a representative sample of households, the 
analysis captured the variability in energy consumption and energy 
prices associated with the use of consumer clothes dryers.
---------------------------------------------------------------------------

    \40\ DOE will update all the data to 2020 RECS if it is 
available prior to the final rule.
---------------------------------------------------------------------------

    Inputs to the calculation of total installed cost include the cost 
of the product--which includes MPCs, manufacturer markups, retailer and 
distributor markups, and sales taxes--and installation costs. Inputs to 
the calculation of operating expenses include annual energy 
consumption, energy prices and price projections, repair and 
maintenance costs, product lifetimes, and discount rates. DOE created 
distributions of values for product lifetime, discount rates, and sales 
taxes, with probabilities attached to each value, to account for their 
uncertainty and variability.
    The computer model DOE uses to calculate the LCC and PBP relies on 
a Monte Carlo simulation to incorporate uncertainty and variability 
into the analysis. The Monte Carlo simulations randomly sample input 
values from the probability distributions and consumer clothes dryers 
user samples. For this rulemaking, the Monte Carlo approach is 
implemented in MS Excel together with the Crystal Ball\TM\ add-on.\41\ 
The model calculated the LCC and PBP for products at each efficiency 
level for 10,000 housing units per simulation run. The analytical 
results include a distribution of 10,000 data points showing the range 
of LCC savings for a given efficiency level relative to the no-new-
standards case efficiency distribution. In performing an iteration of 
the Monte Carlo simulation for a given consumer, product efficiency is 
chosen based on its probability. If the chosen product efficiency is 
greater than or equal to the efficiency of the standard level under 
consideration, the LCC and PBP calculation reveals that a consumer is 
not impacted by the standard level. By accounting for consumers who 
already purchase more-efficient products, DOE avoids overstating the 
potential benefits from increasing product efficiency.
---------------------------------------------------------------------------

    \41\ Crystal Ball\TM\ is commercially-available software tool to 
facilitate the creation of these types of models by generating 
probability distributions and summarizing results within Excel. 
Available at www.oracle.com/technetwork/middleware/crystalball/overview/ (last accessed November 8, 2021).
---------------------------------------------------------------------------

    DOE calculated the LCC and PBP for all consumers of consumer 
clothes dryers as if each were to purchase a new product in the 
expected year of required compliance with new or amended standards. 
Amended standards would

[[Page 51763]]

apply to consumer clothes dryers manufactured 3 years after the date on 
which any amended standard is published. (42 U.S.C. 6295(m)(4)(A)(i)) 
At this time, DOE estimates publication of a final rule in 2023. 
Therefore, for purposes of its analysis, DOE used 2027 as the first 
year of compliance with any amended standards for consumer clothes 
dryers.
    Table IV.30 summarizes the approach and data DOE used to derive 
inputs to the LCC and PBP calculations. The subsections that follow 
provide further discussion. Details of the spreadsheet model, and of 
all the inputs to the LCC and PBP analyses, are contained in chapter 8 
of the NOPR TSD and its appendices.

 Table IV.30--Summary of Inputs and Methods for the LCC and PBP Analysis
                                    *
------------------------------------------------------------------------
              Inputs                            Source/method
------------------------------------------------------------------------
Product Cost......................  Derived by multiplying MPCs by
                                     manufacturer and retailer markups
                                     and sales tax, as appropriate. Used
                                     historical data to derive a price
                                     scaling index to project product
                                     costs.
Installation Costs................  Baseline installation cost
                                     determined with data from RSMeans
                                     Residential Cost Data 2020. Assumed
                                     no change with efficiency level.
Annual Energy Use.................  The total per unit energy use
                                     multiplied by the cycles per year.
                                    Variability: Based on the 2015 RECS
                                     (dryer usage), market data on
                                     remaining moisture content
                                     (``RMC'') and load weights.
Energy Prices.....................  Electricity: Based on EEI 2020.
                                    Variability: Regional energy prices
                                     determined for each Census regions.
Energy Price Trends...............  Based on AEO2021 price projections.
Repair and Maintenance Costs......  Assumed no change with efficiency
                                     level for maintenance costs. Repair
                                     costs estimated for each product
                                     class and efficiency level.
Product Lifetime..................  Average: 14 years.
Discount Rates....................  Approach involves identifying all
                                     possible debt or asset classes that
                                     might be used to purchase the
                                     considered appliances, or might be
                                     affected indirectly. Primary data
                                     source was the Federal Reserve
                                     Board's Survey of Consumer
                                     Finances.
Compliance Date...................  2027.
------------------------------------------------------------------------
* References for the data sources mentioned in this table are provided
  in the sections following the table or in chapter 8 of the NOPR TSD.

1. Product Cost
    To calculate consumer product costs, DOE multiplied the MPCs 
developed in the engineering analysis by the markups described 
previously (along with sales taxes). DOE used different markups for 
baseline products and higher-efficiency products, because DOE applies 
an incremental markup to the increase in MSP associated with higher-
efficiency products.
    Economic literature and historical data suggest that the real costs 
of many products may trend downward over time according to ``learning'' 
or ``experience'' curves. Experience curve analysis implicitly includes 
factors such as efficiencies in labor, capital investment, automation, 
materials prices, distribution, and economies of scale at an industry-
wide level. To derive the learning rate parameter for consumer clothes 
dryers, DOE obtained historical Producer Price Index (``PPI'') data for 
``household laundry equipment'' between 1948 and 2016 and ``major 
household appliance: primary products'' between 2016 and 2020 from the 
Bureau of Labor Statistics (``BLS'') to form a time series price index 
representing household laundry equipment from 1948 to 2020.\42\ 
Inflation-adjusted price indices were calculated by dividing the PPI 
series by the gross domestic product index from the Bureau of Economic 
Analysis for the same years. Using data from 1948-2020, the estimated 
learning rate (defined as the fractional reduction in price from each 
doubling of cumulative production) is 14.8 percent.
---------------------------------------------------------------------------

    \42\ Household laundry equipment PPI (PCU3352203352204) is 
available till May 2016, and major household appliance: primary 
products (PCU335220335220P) is available starting from 2016. See 
more information at www.bls.gov/ppi/ (last accessed November 29, 
2021).
---------------------------------------------------------------------------

    ASAP and NRDC encouraged DOE to investigate how the analysis could 
reflect learning rates associated with specific technology options for 
clothes dryers and suggested an approach similar to that taken in the 
2017 Final Rule for ceiling fans where DOE estimated a learning rate 
specific to brushless DC motors. (ASAP, NRDC, No. 25 at p. 4)
    DOE examined data pertaining to specific technologies, such as the 
heat pump. However, the heat pump producer price index series starts 
only from 2010, and the deflated PPI for the limited data does not 
indicate any observable trend specific to heat pump technology during 
this limited time series. DOE has therefore not incorporated a learning 
or experience trend specific to heat pump technology in this analysis. 
As heat pump technology continues to mature and gain market share over 
time, DOE expects that ``learning'' or ``experience'' curves are likely 
to become relevant to heat pump technology in the future. DOE seeks 
comment on this approach and how product costs for heat pump technology 
may change over time.
2. Installation Cost
    Installation cost includes labor, overhead, and any miscellaneous 
materials and parts needed to install the product. DOE used data from 
RSMeans Residential Cost Data to estimate the baseline installation 
cost for consumer clothes dryers.\43\ DOE estimated that for the new 
construction market it takes on average a total of one hour to install 
a clothes dryer, while for the replacement or new owners markets it 
takes a total of two-and a-half hours to install a clothes dryer (one 
hour for trip charge, half an hour to remove old clothes dryer, and one 
hour to install).
---------------------------------------------------------------------------

    \43\ RSMeans Online Residential Data (2020 Release). Gordian: 
Greenville, SC. Available at www.rsmeansonline.com/ (last accessed 
November 8, 2021).
---------------------------------------------------------------------------

    ASAP and NRDC encouraged DOE to reevaluate the increased 
installation costs associated with the additional labor hours DOE 
stated would be required for heat pumps due to their larger dimensions 
relative to conventional dryers. According to ASAP and NRDC, ENERGY 
STAR-certified heat pump dryers have total volumes of either 18.1 or 
18.4 ft\3\, while most non-heat pump models have total volumes between 
17 and 23 ft\3\, so it does not appear that heat pump dryers have 
larger dimensions than

[[Page 51764]]

conventional dryers. (ASAP, NRDC, No. 25 at p. 3)
    DOE collected and analyzed retail data of available models of both 
conventional dryers and dryers with heat pump technology, and found 
that the dimensions and weight of heat pump dryers are not 
significantly different from other conventional dryers. DOE has 
therefore revised its installation cost to not vary based on 
technology.
3. Annual Energy Consumption
    For each sampled household, DOE determined the energy consumption 
for a consumer clothes dryer at different efficiency levels using the 
approach described previously in section IV.E of this document.
4. Energy Prices
    Because marginal electricity and gas prices more accurately 
captures the incremental savings associated with a change in energy use 
from higher efficiency, they provide a better representation of 
incremental change in consumer costs than average electricity and gas 
prices. Therefore, DOE applied average electricity and gas prices for 
the energy use of the product purchased in the no-new-standards case, 
and marginal electricity and gas prices for the incremental change in 
energy use associated with the other efficiency levels considered.
    DOE derived electricity prices in 2020 using data from Edison 
Electric Institute (``EEI'') Typical Bills and Average Rates 
reports.\44\ Based upon comprehensive, industry-wide surveys, this 
semi-annual report presents typical monthly electric bills and average 
kilowatt-hour costs to the customer as charged by investor-owned 
utilities. DOE calculated residential sector electricity prices using 
the methodology described in Coughlin and Beraki (2018).\45\
---------------------------------------------------------------------------

    \44\ Edison Electric Institute. Typical Bills and Average Rates 
Report. 2020. Winter 2020, Summer 2020: Washington, DC.
    \45\ Coughlin, K. and B. Beraki.2018. Residential Electricity 
Prices: A Review of Data Sources and Estimation Methods. Lawrence 
Berkeley National Lab. Berkeley, CA. Report No. LBNL-2001169. 
Available at ees.lbl.gov/publications/residential-electricity-prices-review.
---------------------------------------------------------------------------

    DOE obtained data for calculating regional prices of natural gas 
from the EIA publication, Natural Gas Navigator.\46\ This publication 
presents monthly volumes of natural gas deliveries and average prices 
by state for residential, commercial, and industrial customers.
---------------------------------------------------------------------------

    \46\ U.S. Department of Energy-Energy Information 
Administration. Natural Gas Navigator 2020. Available at 
www.eia.gov/naturalgas/data.php (last accessed November 14, 2021).
---------------------------------------------------------------------------

    DOE's methodology allows electricity and gas prices to vary by 
sector, region and season. In the analysis, variability in electricity 
and gas prices is chosen to be consistent with the way the consumer 
economic and energy use characteristics are defined in the LCC 
analysis. For consumer clothes dryers, DOE calculated weighted-average 
values for average and marginal electricity and gas price for the nine 
census divisions. See chapter 8 of the NOPR TSD for details.
    To estimate energy prices in future years, DOE multiplied the 2020 
energy prices by the projection of annual average price changes for 
each of the nine census divisions from the Reference case in AEO2021, 
which has an end year of 2050.\47\ To estimate price trends after 2050, 
DOE used the average annual rate of change in prices from 2040 through 
2050.
---------------------------------------------------------------------------

    \47\ EIA. Annual Energy Outlook 2021 with Projections to 2050. 
Washington, DC. Available at www.eia.gov/forecasts/aeo/ (last 
accessed November 8, 2021).
---------------------------------------------------------------------------

5. Maintenance and Repair Costs
    Repair costs are associated with repairing or replacing product 
components that have failed in an appliance; maintenance costs are 
associated with maintaining the operation of the product. Past rules 
indicate in general that small incremental increases in product 
efficiency produce no, or only minor, changes in repair and maintenance 
costs compared to baseline efficiency products. 76 FR 22454.
    For consumer clothes dryers, DOE derived annualized repair 
frequencies based on Consumer Reports data on repair and maintenance 
issues for clothes dryers during the first five years of ownership. DOE 
estimated that on average 2.7 percent of electric and 3.3 percent of 
gas clothes dryers are repaired each year. DOE estimated that an 
average service call and repair takes about 2.5 hours and that the 
average material cost is equal to one-half of the equipment cost. The 
values for cost per service call are then annualized by multiplying by 
the frequencies and dividing by the average equipment lifetime of 14 
years.
    AHAM suggested that repair costs may be higher with increased 
efficiency because repairs will likely be more complex. AHAM stated 
that if energy conservation standards require baseline products to have 
electronic controls, repair and maintenance costs will likely increase 
for the same reason. Additionally, AHAM stated that longer cycle times 
may also drive increased rate of repair and shorter product lifetimes. 
(AHAM, No. 23 at p. 11) Whirlpool requested that DOE account for 
changes to components that may be needed to accommodate longer cycle 
times, as well as the possibility of increased maintenance costs 
associated with longer cycle times. According to Whirlpool, increased 
cycle time leads to more wear and tear on the dryer as components could 
fail before the end of the estimated lifespan of the entire dryer, 
resulting in additional expenses. (Whirlpool, No. 27 at p. 12)
    DOE based its current estimates of repair and maintenance cost on 
available data. As stated above, DOE estimated that an average service 
call and repair for a consumer clothes dryer takes about 2.5 hours and 
the average material cost is equal to one-half of the equipment cost. 
DOE will take into consideration any data on frequency of repair for 
higher-efficiency dryers if it becomes available.
    DOE requests information and data on repair cost for replacing an 
electromechanical and electronic control panel.
    In addition, DOE seeks input on characterizing maintenance and 
repair costs for more-efficient consumer clothes dryers.
6. Product Lifetime
    For consumer clothes dryers, DOE developed a distribution of 
lifetimes from which specific values are assigned to the appliances in 
the samples. DOE conducted an analysis of actual lifetime in the field 
using a combination of historical shipments data, the stock of the 
considered appliances in the American Housing Survey, and responses in 
RECS on the age of the appliances in the homes. The data allowed DOE to 
estimate a survival function, which provides an average appliance 
lifetime. This analysis yielded a lifetime probability distribution 
with an average lifetime for consumer clothes dryers of approximately 
14 years. See chapter 8 of the NOPR TSD for further details.
    Whirlpool requested that DOE account for changes to components that 
may be needed to accommodate longer cycle times, as well as the 
possibility of shorter product lifetimes associated with longer cycle 
times. (Whirlpool, No. 27 at p. 12)
    DOE will take into consideration any data that becomes available on 
changes to components to accommodate longer cycle times and the 
possibility of its impact on product lifetime.

[[Page 51765]]

7. Discount Rates
    In the calculation of LCC, DOE applies discount rates appropriate 
to households to estimate the present value of future operating cost 
savings. DOE estimated a distribution of discount rates for consumer 
clothes dryers based on the opportunity cost of consumer funds.
    DOE applies weighted average discount rates calculated from 
consumer debt and asset data, rather than marginal or implicit discount 
rates.\48\ The LCC analysis estimates net present value over the 
lifetime of the product, so the appropriate discount rate will reflect 
the general opportunity cost of household funds, taking this time scale 
into account. Given the long time horizon modeled in the LCC analysis, 
the application of a marginal interest rate associated with an initial 
source of funds is inaccurate. Regardless of the method of purchase, 
consumers are expected to continue to rebalance their debt and asset 
holdings over the LCC analysis period, based on the restrictions 
consumers face in their debt payment requirements and the relative size 
of the interest rates available on debts and assets. DOE estimates the 
aggregate impact of this rebalancing using the historical distribution 
of debts and assets.
---------------------------------------------------------------------------

    \48\ The implicit discount rate is inferred from a consumer 
purchase decision between two otherwise identical goods with 
different first cost and operating cost. It is the interest rate 
that equates the increment of first cost to the difference in net 
present value of lifetime operating cost, incorporating the 
influence of several factors: transaction costs; risk premiums and 
response to uncertainty; time preferences; interest rates at which a 
consumer is able to borrow or lend.
---------------------------------------------------------------------------

    To establish residential discount rates for the LCC analysis, DOE 
identified all relevant household debt or asset classes in order to 
approximate a consumer's opportunity cost of funds related to appliance 
energy cost savings. It estimated the average percentage shares of the 
various types of debt and equity by household income group using data 
from the Federal Reserve Board's Survey of Consumer Finances \49\ 
(``SCF'') for 1995, 1998, 2001, 2004, 2007, 2010, 2013, 2016, and 2019. 
Using the SCF and other sources, DOE developed a distribution of rates 
for each type of debt and asset by income group to represent the rates 
that may apply in the year in which amended standards would take 
effect. DOE assigned each sample household a specific discount rate 
drawn from one of the distributions. The average rate across all types 
of household debt and equity and income groups, weighted by the shares 
of each type, is 4.3 percent. See chapter 8 of the NOPR TSD for further 
details on the development of consumer discount rates.
---------------------------------------------------------------------------

    \49\ U.S. Board of Governors of the Federal Reserve System. 
Survey of Consumer Finances. 1995, 1998, 2001, 2004, 2007, 2010, 
2013, 2016, and 2019. Available at www.federalreserve.gov/econresdata/scf/scfindex.htm (last accessed November 8, 2021.)
---------------------------------------------------------------------------

    Energy Solutions questioned whether DOE expects changes to be made 
regarding average real effective discount rate as a function of 
different income groups. (Webinar Transcript, No. 22 at p. 71)
    As discussed above, DOE takes different income groups into 
consideration for establishing discount rates.
8. Energy Efficiency Distribution in the No-New-Standards Case
    To accurately estimate the share of consumers that would be 
affected by a potential energy conservation standard at a particular 
efficiency level, DOE's LCC analysis considered the projected 
distribution (market shares) of product efficiencies under the no-new-
standards case (i.e., the case without amended or new energy 
conservation standards).
    To estimate the energy efficiency distribution of consumer clothes 
dryers for 2027, DOE used data from DOE's CCMS and ENEGY STAR Clothes 
Dryer program.\50\ \51\ DOE estimated an annual 0.31 percent and 0.37 
percent increase in shipment-weighted efficiency beginning in 2022 for 
electric standard and vented gas standard clothes dryers, respectively. 
Annual shipment-weighted efficiency for the other product classes 
(which in total have less than 2.5 percent market share) is held 
constant. The estimated market shares for the no-new-standards case for 
consumer clothes dryers are shown in Table IV.31 and Table IV.32. See 
chapter 8 of the NOPR TSD for further information on the derivation of 
the efficiency distributions.
---------------------------------------------------------------------------

    \50\ U.S. Department of Energy's Compliance Certification 
Database. Available at www.regulations.doe.gov/certification-data/#q=Product_Group_s%3A* (last accessed November 8, 2021).
    \51\ ENERGY STAR, ENERGY STAR[supreg] Unit Shipment and Market 
Penetration Report Calendar Year 2020 Summary. Available at 
www.energystar.gov/partner_resources/products_partner_resources/brand_owner_resources/unit_shipment_data (last accessed November 8, 
2021).

   Table IV.31--No-New-Standards Case Efficiency Distribution in 2027: Electric Standard, Electric Compact (120V), Vented Electric Compact (240V), and
                                                            Ventless Electric Compact (240V)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                    Electric standard                         Electric compact (120V)        Vented electric, compact       Ventless electric, compact
-----------------------------------------------------------------------------------------             (240V)                          (240V)
                                                                                         ---------------------------------------------------------------
             CEFD2 (lb/kWh)                  Share (%)    CEFD2 (lb/kWh)     Share (%)    CEFD2 (lb/kWh)                  CEFD2 (lb/kWh)
                                                                                                             Share (%)                       Share (%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
2.20....................................            30.8            2.36            58.6            2.00            73.7            2.03            10.4
2.68....................................            0.89            3.15             0.0            2.44             0.0            2.68            87.5
3.04....................................            1.07            3.35            10.3            2.76            10.5            6.80            2.08
3.27....................................            1.94            4.28             0.0            3.30            15.8
3.93....................................            61.0            4.33             0.0            3.57             0.0
4.21....................................            2.62            4.63             0.0            3.82             0.0
5.20....................................            0.60            6.37            31.0            3.91             0.0
7.39....................................            1.06
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 51766]]


Table IV.32--No-New-Standards Case Efficiency Distribution in 2027: Vented Gas Standard, Vented Gas Compact, and
                                   Ventless Electric Combination Washer-Dryer
----------------------------------------------------------------------------------------------------------------
               Vented gas standard                      Vented gas compact        Ventless electric, combination
---------------------------------------------------------------------------------          washer-dryer
                                                                                 -------------------------------
         CEFD2 (lb/kWh)              Share (%)    CEFD2 (lb/kWh)     Share (%)    CEFD2 (lb/kWh)
                                                                                                     Share (%)
----------------------------------------------------------------------------------------------------------------
2.00............................            49.3            1.66             100            2.27            70.0
2.44............................            4.45            2.02             0.0            2.33            26.7
3.00............................            3.75            2.49             0.0            4.01            3.33
3.48............................            38.1            2.89             0.0
3.83............................            4.44            3.17             0.0
----------------------------------------------------------------------------------------------------------------

    NEEA encouraged DOE to retain the market distribution of dryer 
efficiency levels shown in the NIA of the preliminary analysis TSD. 
(NEEA, No. 30 at p. 15)
    DOE has revised its efficiency distribution based on more recent 
market data. DOE chose to not develop a consumer choice model for 
estimating the efficiency distribution for this round of analysis, as 
the only available model and price data are more than a decade old, and 
not as useful in capturing the current distribution. DOE will update 
the efficiency distribution if more recent price data becomes 
available.
    DOE requests comments, information, and data on the no-new-
standards case efficiency distribution of consumer clothes dryers.
9. Payback Period Analysis
    The payback period is the amount of time it takes the consumer to 
recover the additional installed cost of more-efficient products, 
compared to baseline products, through energy cost savings. Payback 
periods are expressed in years. Payback periods that exceed the life of 
the product mean that the increased total installed cost is not 
recovered in reduced operating expenses.
    The inputs to the PBP calculation for each efficiency level are the 
change in total installed cost of the product and the change in the 
first-year annual operating expenditures relative to the baseline. The 
PBP calculation uses the same inputs as the LCC analysis, except that 
discount rates are not needed.
    As noted previously, EPCA establishes a rebuttable presumption that 
a standard is economically justified if the Secretary finds that the 
additional cost to the consumer of purchasing a product complying with 
an energy conservation standard level will be less than three times the 
value of the first year's energy savings resulting from the standard, 
as calculated under the applicable test procedure. (42 U.S.C. 
6295(o)(2)(B)(iii)) For each considered efficiency level, DOE 
determined the value of the first year's energy savings by calculating 
the energy savings in accordance with the applicable DOE test 
procedure, and multiplying those savings by the average energy price 
projection for the year in which compliance with the amended standards 
would be required.

G. Shipments Analysis

    DOE uses projections of annual product shipments to calculate the 
national impacts of potential amended or new energy conservation 
standards on energy use, NPV, and future manufacturer cash flows.\52\ 
The shipments model takes an accounting approach, tracking market 
shares of each product class and the vintage of units in the stock. 
Stock accounting uses product shipments as inputs to estimate the age 
distribution of in-service product stocks for all years. The age 
distribution of in-service product stocks is a key input to 
calculations of both the NES and NPV, because operating costs for any 
year depend on the age distribution of the stock.
---------------------------------------------------------------------------

    \52\ DOE uses data on manufacturer shipments as a proxy for 
national sales, as aggregate data on sales are lacking. In general, 
one would expect a close correspondence between shipments and sales.
---------------------------------------------------------------------------

    Total product shipments for consumer clothes dryers are developed 
by considering the demand from replacements for units in stock that 
fail and the demand from new installations in newly constructed homes. 
DOE calculated shipments due to replacements using the retirement 
function developed for the LCC analysis. DOE calculated shipments due 
to new installations using estimates for consumer clothes dryer 
saturation rate in newly constructed homes from 2010 to 2015 in 2015 
RECS and projections of new housing starts from AEO2021.
    DOE disaggregated total product shipments into each product class 
using estimated market shares of each product class. To estimate these 
market shares, DOE first developed a linear time-series regression 
model to estimate market share between the product fuel type (gas or 
electric) by fitting the historical shipments of gas consumer clothes 
dryers. Historical shipments data shown a steady decline of market 
share of gas consumer clothes dryers from 23 percent in 2000 to 18 
percent in 2020. The linear regression model indicates that market 
share of gas consumer clothes dryers is strongly correlated with its 
historical time-series.
    After developing the market share estimation between the electric 
and gas consumer clothes dryers, DOE then subtracted estimated gas 
clothes dryer market share from total shipments and divided the 
electric clothes dryer market share into each electric consumer clothes 
dryer product class. DOE estimated that electric standard and vented 
gas standard consumer clothes dryers account for approximately 84 
percent and 14 percent of the total shipments during the analysis 
period, respectively.
    Whirlpool points out that the projected consumer clothes dryer 
market shares by product class do not show any change in the balance of 
sale between the product classes, aside from a loss of share from 
Vented Gas Standard and an increase in share of Vented Electric 
Standard. Whirlpool indicates that they have started to see more 
shipments of other product classes over the last few years, including 
the ventless and combination washer/dryer product classes and therefore 
suggests that DOE project some growth in the balance of sale of these 
product classes. (Whirlpool, No. 27 at pp. 17-18)
    For this analysis, DOE does consider a slight growth in the market 
share of other product classes such as ventless and combination washer/
dryers. DOE will consider any specific data that is available to 
project this category more accurately.
    To estimate shipments under a standards case, DOE considers the 
impacts on shipments from changes in product purchase price and 
operating cost associated with higher energy efficiency levels using a 
price elasticity and an efficiency elasticity. As in the

[[Page 51767]]

April 2021 Preliminary Analysis, DOE employed a 0.2 percent efficiency 
elasticity rate and a price elasticity of -0.45 percent in its 
shipments model. These values are based on analysis of aggregated data 
for five residential appliances including consumer clothes washers, 
dishwashers, refrigerators, freezers, and room air-conditioners.\53\ 
The market impact is defined as the difference between the product of 
price elasticity of demand and the change in price due to a standard 
level, and the product of the efficiency elasticity and the change in 
operating costs due to a standard level. See chapter 9 of the NOPR TSD 
for details.
---------------------------------------------------------------------------

    \53\ Fujita, K. (2015) Estimating Price Elasticity using Market-
Level Appliance Data. Lawrence Berkeley National Laboratory, LBNL-
188289.
---------------------------------------------------------------------------

    ASAP and NRDC encouraged DOE to clarify and confirm whether the 
efficiency elasticity is considered in calculating the standards-case 
shipments. Commenters noted that the preliminary TSD described a price 
elasticity of -0.45 and an efficiency elasticity of +0.2 but that the 
equation for calculating total shipments in the standards case included 
only the price elasticity of -0.45. (ASAP, NRDC, No. 25 at p. 4)
    As discussed earlier, DOE considers the impact of increase in 
purchase price as well as efficiency in estimating the shipments 
through the use of a price elasticity. The NOPR TSD describes both 
elasticities and provides an equation in chapter 9.
    DOE requests comment on its methodology for estimating shipments. 
DOE also requests comment on its approach to estimate the market share 
for each consumer clothes dryer product class.

H. National Impact Analysis

    The NIA assesses the NES and the NPV from a national perspective of 
total consumer costs and savings that would be expected to result from 
new or amended standards at specific efficiency levels.\54\ 
(``Consumer'' in this context refers to consumers of the product being 
regulated.) DOE calculates the NES and NPV for the potential standard 
levels considered based on projections of annual product shipments, 
along with the annual energy consumption and total installed cost data 
from the energy use and LCC analyses. For the present analysis, DOE 
projected the energy savings, operating cost savings, product costs, 
and NPV of consumer benefits over the lifetime of consumer clothes 
dryers sold from 2027 through 2056.
---------------------------------------------------------------------------

    \54\ The NIA accounts for impacts in the 50 states and the 
District of Columbia.
---------------------------------------------------------------------------

    DOE evaluates the impacts of new or amended standards by comparing 
a case without such standards with standards-case projections. The no-
new-standards case characterizes energy use and consumer costs for each 
product class in the absence of new or amended energy conservation 
standards. For this projection, DOE considers historical trends in 
efficiency and various forces that are likely to affect the mix of 
efficiencies over time. DOE compares the no-new-standards case with 
projections characterizing the market for each product class if DOE 
adopted new or amended standards at specific energy efficiency levels 
(i.e., the TSLs or standards cases) for that class. For the standards 
cases, DOE considers how a given standard would likely affect the 
market shares of products with efficiencies greater than the standard.
    DOE uses a spreadsheet model to calculate the energy savings and 
the national consumer costs and savings from each TSL. Interested 
parties can review DOE's analyses by changing various input quantities 
within the spreadsheet. The NIA spreadsheet model uses typical values 
(as opposed to probability distributions) as inputs.
    Table IV.33 summarizes the inputs and methods DOE used for the NIA 
analysis for the NOPR. Discussion of these inputs and methods follows 
the table. See chapter 10 of the NOPR TSD for further details.

   Table IV.33--Summary of Inputs and Methods for the National Impact
                                Analysis
------------------------------------------------------------------------
              Inputs                               Method
------------------------------------------------------------------------
Shipments.........................  Annual shipments from shipments
                                     model.
Compliance Date of Standard.......  2027.
Efficiency Trends.................  No-new-standards case: Annual
                                     efficiency improvement of 0.31
                                     percent for electric standard and
                                     0.37 for vented gas standard
                                     consumer clothes dryers.
                                    Standards cases: ``Roll up''
                                     equipment to meet potential
                                     efficiency level.
Annual Energy Consumption per Unit  Calculated for no-new-standards case
                                     and each TSL based on inputs from
                                     energy use analysis.
Total Installed Cost per Unit.....  Calculated for no-new-standards case
                                     and each TSL based on inputs from
                                     the LCC analysis. Incorporates
                                     projection of future product prices
                                     based on historical data.
Repair and Maintenance Cost per     Assumed no change with efficiency
 Unit.                               level for maintenance cost. Repair
                                     cost is calculated for each
                                     efficiency level based on inputs
                                     from the LCC analysis.
Energy Prices.....................  Estimated average and marginal
                                     electricity and gas prices from the
                                     LCC analysis based on EEI and EIA
                                     data.
Energy Price Trends...............  AEO2021 projections (to 2050) and
                                     extrapolation using a fixed annual
                                     rate of price change between 2040
                                     and 2050 thereafter.
Energy Site-to-Primary and FFC      A time-series conversion factor
 Conversion.                         based on AEO2021.
Discount Rate.....................  3 percent and 7 percent.
Present Year......................  2021.
------------------------------------------------------------------------

1. Product Efficiency Trends
    A key component of the NIA is the trend in energy efficiency 
projected for the no-new-standards case and each of the standards 
cases. Section IV.F.8 of this document describes how DOE developed an 
energy efficiency distribution for the no-new-standards case (which 
yields a shipment-weighted average efficiency) for each of the 
considered product classes for the year of anticipated compliance with 
an amended or new standard. To project the trend in efficiency absent 
amended standards for consumer clothes dryers over the entire shipments 
projection period, DOE used an annual 0.31 percent and 0.37 percent 
increase in shipment-weighted efficiency beginning in 2022 for electric 
standard and vented gas standard consumer clothes dryers,

[[Page 51768]]

respectively. The efficiency for the other product classes remains at 
their 2021 shipments-weighted efficiency levels. The approach is 
further described in chapter 10 of the NOPR TSD.
    For the standards cases, DOE used a ``roll-up'' scenario to 
establish the shipment-weighted efficiency for the year that standards 
are assumed to become effective (2027). In this scenario, the market 
shares of products in the no-new-standards case that do not meet the 
standard under consideration would ``roll up'' to meet the new standard 
level, and the market share of products above the standard would remain 
unchanged.
2. National Energy Savings
    The national energy savings analysis involves a comparison of 
national energy consumption of the considered products between each 
potential standards case (``TSL'') and the case with no new or amended 
energy conservation standards. DOE calculated the national energy 
consumption by multiplying the number of units (stock) of each product 
(by vintage or age) by the unit energy consumption (also by vintage). 
DOE calculated annual NES based on the difference in national energy 
consumption for the no-new standards case and for each higher 
efficiency standard case. DOE estimated energy consumption and savings 
based on site energy and converted the electricity consumption and 
savings to primary energy (i.e., the energy consumed by power plants to 
generate site electricity) using annual conversion factors derived from 
AEO2021. Cumulative energy savings are the sum of the NES for each year 
over the timeframe of the analysis.
    Use of higher-efficiency products is sometimes associated with a 
direct rebound effect, which refers to an increase in utilization of 
the product due to the increase in efficiency. DOE did not find any 
data on the rebound effect specific to consumer clothes dryers, so it 
did not include a rebound effect in the analysis.
    Whirlpool suggested that additional energy usage may result from 
increased cycle times and the inability to complete serial loads when 
consumers decide to re-wash a load if wet clothes sit in the washer 
while waiting for the drying cycle to terminate. Whirlpool stated that 
such a scenario could result in additional and unnecessary energy 
consumption and should be closely examined as rebound effects from 
increased cycle times. (Whirlpool No. 27, at p. 11)
    For this analysis, DOE did not find any studies supporting or 
indicating an increased usage resulting from cycle times. DOE requests 
comment on any new information or data that points to an impact on 
usage due to a change in cycle times and will consider such data at the 
final rule stage and in the final TSD.
    In 2011, 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 Sciences, 
DOE announced its intention to use 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 (Aug. 18, 2011). After evaluating the 
approaches discussed in the August 18, 2011 notice, DOE published a 
statement of amended policy in which DOE explained its determination 
that EIA's National Energy Modeling System (``NEMS'') is the most 
appropriate tool for its FFC analysis and its intention to use NEMS for 
that purpose. 77 FR 49701 (Aug. 17, 2012). NEMS is a public domain, 
multi-sector, partial equilibrium model of the U.S. energy sector \55\ 
that EIA uses to prepare its Annual Energy Outlook. The FFC factors 
incorporate losses in production and delivery in the case of natural 
gas (including fugitive emissions) and additional energy used to 
produce and deliver the various fuels used by power plants. The 
approach used for deriving FFC measures of energy use and emissions is 
described in appendix 10B of the NOPR TSD.
---------------------------------------------------------------------------

    \55\ For more information on NEMS, refer to The National Energy 
Modeling System: An Overview 2009, DOE/EIA-0581(2009), October 2009. 
Available at www.eia.gov/forecasts/aeo/index.cfm (last accessed 
November 8, 2021).
---------------------------------------------------------------------------

3. Net Present Value Analysis
    The inputs for determining the NPV of the total costs and benefits 
experienced by consumers are (1) total annual installed cost, (2) total 
annual operating costs (energy costs and repair and maintenance costs), 
and (3) a discount factor to calculate the present value of costs and 
savings. DOE calculates net savings each year as the difference between 
the no-new-standards case and each standards case in terms of total 
savings in operating costs versus total increases in installed costs. 
DOE calculates operating cost savings over the lifetime of each product 
shipped during the projection period.
    As discussed in section IV.F.1 of this document, DOE developed 
consumer clothes dryers price trends based on historical PPI data. DOE 
applied the same trends to project prices for each product class at 
each considered efficiency level. By 2056, which is the end date of the 
projection period, the average consumer clothes dryers (real) price is 
projected to drop 15 percent relative to 2020. DOE's projection of 
product prices is described in appendix 10C of the NOPR TSD.
    To evaluate the effect of uncertainty regarding the price trend 
estimates, DOE investigated the impact of different product price 
projections on the consumer NPV for the considered TSLs for consumer 
clothes dryers. In addition to the default price trend, DOE considered 
two product price sensitivity cases: (1) a high price decline case 
based on the combined price index from 1980 to 2020 and (2) a low price 
decline case based on the same series from 1948 to 1979.\56\ The 
derivation of these price trends and the results of these sensitivity 
cases are described in appendix 10C of the NOPR TSD.
---------------------------------------------------------------------------

    \56\ DOE combined PPI data of ``household laundry equipment'' 
from 1948 to 2016 and PPI data of ``major household appliance: 
primary products'' from 2016 to 2020 into one time series price 
index to project future price for consumer clothes washers.
---------------------------------------------------------------------------

    The energy cost savings are calculated using the estimated energy 
savings in each year and the projected price of the appropriate form of 
energy. To estimate energy prices in future years, DOE used the 
projection of annual national-average residential energy price changes 
in the Reference case from AEO2021, which has an end year of 2050. To 
estimate price trends after 2050, DOE used the average annual rate of 
change in prices from 2040 through 2050. As part of the NIA, DOE also 
analyzed scenarios that used inputs from variants of the AEO2021 
Reference case that have lower and higher economic growth. Those cases 
have lower and higher energy price trends compared to the Reference 
case. NIA results based on these cases are presented in appendix 10D of 
the NOPR TSD.
    In calculating the NPV, DOE multiplies the net savings in future 
years by a discount factor to determine their present value. For this 
NOPR, DOE estimated the NPV of consumer benefits using both a 3-percent 
and a 7-percent real discount rate. DOE uses these discount rates in 
accordance with guidance provided by the Office of Management and 
Budget (``OMB'') to Federal agencies on the development of regulatory 
analysis.\57\ The discount rates

[[Page 51769]]

for the determination of NPV are in contrast to the discount rates used 
in the LCC analysis, which are designed to reflect a consumer's 
perspective. 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 ``social rate of time preference,'' 
which is the rate at which society discounts future consumption flows 
to their present value.
---------------------------------------------------------------------------

    \57\ United States Office of Management and Budget. Circular A-
4: Regulatory Analysis. September 17, 2003. Section E. Available at 
https://www.whitehouse.gov/wp-content/uploads/legacy_drupal_files/omb/circulars/A4/a-4.pdf (last accessed November 8, 2021).
---------------------------------------------------------------------------

I. Consumer Subgroup Analysis

    In analyzing the potential impact of new or amended energy 
conservation standards on consumers, DOE evaluates the impact on 
identifiable subgroups of consumers that may be disproportionately 
affected by a new or amended national standard. The purpose of a 
subgroup analysis is to determine the extent of any such 
disproportional impacts. DOE evaluates impacts on particular subgroups 
of consumers by analyzing the LCC impacts and PBP for those particular 
consumers from alternative standard levels. For this NOPR, DOE analyzed 
the impacts of the considered standard levels on two subgroups: (1) 
low-income households and (2) senior-only households. The analysis used 
subsets of the 2015 RECS sample composed of households that meet the 
criteria for the two subgroups. DOE used the LCC and PBP spreadsheet 
model to estimate the impacts of the considered efficiency levels on 
these subgroups. Chapter 11 in the NOPR TSD describes the consumer 
subgroup analysis.
    Whirlpool requested that DOE examine the impact of amended 
standards on the increased purchase cost of dryers, particularly for 
low-income consumers. According to Whirlpool, the purchase cost of a 
dryer plays a significant, and often the leading, factor in a low-
income consumer's purchase decision. Additionally, Whirlpool states 
that for many low-income consumers, appliance purchases are generally 
not planned and happen when their current appliance breaks down or is 
too costly or old to fix. With a high purchase cost, low-income 
consumers may ultimately decide to keep the old unit and repair it or 
purchase a used appliance, both of which would keep old, inefficient 
appliances on the grid, counter to DOE's mission to save energy. 
(Whirlpool, No. 27 at pp. 6-8) AHAM requested that DOE take special 
care to protect low-income consumers and to ensure energy conservation 
standards do not have a disproportionate impact on those consumers, 
stating that any proposed standard level not require product design 
options that price consumers, particularly low-income consumers, out of 
the clothes dryer market by eliminating technology options that allow 
manufacturers to produce ``entry level'' models. (AHAM, No. 23 at p. 5)
    DOE considers the impact of increase in purchase price as well as 
efficiency in estimating the shipments through the use of a price 
elasticity. This integrated elasticity accounts for the choice of 
repair versus replace, which is ultimately reflected in the resulting 
shipments. Additionally, the impacts from design options on low-income 
consumers are already accounted for by definition in the screening, 
engineering, LCC subgroup, and manufacturer impact analyses. See 
chapter 9 of the NOPR TSD for details on price elasticity and chapter 
11 for details on low-income consumers impacts.

J. Manufacturer Impact Analysis

1. Overview
    DOE performed a MIA to estimate the financial impacts of amended 
energy conservation standards on manufacturers of consumer clothes 
dryers and to estimate the potential impacts of such standards on 
employment and manufacturing capacity. The MIA has both quantitative 
and qualitative aspects and includes analyses of projected 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 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, including small business 
manufacturers.
    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 uses 
standard accounting principles to estimate the impacts of more-
stringent energy conservation standards on a given industry by 
comparing changes in INPV and domestic manufacturing employment between 
a no-new-standards case and the various TSLs. To capture the 
uncertainty relating to manufacturer pricing strategies following 
amended standards, the GRIM estimates a range of possible impacts under 
different manufacturer markup scenarios.
    The qualitative part of the MIA addresses manufacturer 
characteristics and market trends. Specifically, the MIA considers such 
factors as a potential standard's impact on manufacturing capacity, 
competition within the industry, the cumulative impact of other DOE and 
non-DOE regulations, and impacts on manufacturer subgroups. 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 consumer clothes dryer 
industry based on publicly available data and information from its 
market and technology assessment and engineering analysis. This 
included a top-down analysis of consumer clothes dryer 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 other public sources of information to further 
calibrate its initial characterization of the consumer clothes dryer 
manufacturing industry, including company filings of form 10-K from the 
U.S. Securities and Exchange Commission (``SEC''),\58\ corporate annual 
reports, and the U.S. Census Bureau's Economic Census,\59\ as well as 
subscription-based market research tools (e.g., reports from Dun & 
Bradstreet \60\).
---------------------------------------------------------------------------

    \58\ U.S. Securities and Exchange Commission. Company Filings. 
Available at https://www.sec.gov/edgar/searchedgar/companysearch.html.
    \59\ The U.S. Census Bureau. Quarterly Survey of Plant Capacity 
Utilization. Available at www.census.gov/programs-surveys/qpc/data/tables.html.
    \60\ The Dun & Bradstreet Hoovers login is available at 
app.dnbhoovers.com.
---------------------------------------------------------------------------

    In Phase 2 of the MIA, DOE prepared a framework industry cash-flow 
analysis to quantify the potential impacts of 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 compliance 
date of the standard. These factors include annual

[[Page 51770]]

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) creating a 
need for increased investment, (2) raising production costs per unit, 
and (3) altering 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 consumer clothes dryers in order to 
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 representative 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.3 of this document 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 business manufacturers, low-
volume manufacturers, niche players, and/or manufacturers exhibiting a 
cost structure that largely differs from the industry average. DOE 
identified one subgroup for a separate impact analysis: small business 
manufacturers. The small business subgroup is discussed in section VI.B 
of this document, ``Review under the Regulatory Flexibility Act'' and 
in chapter 12 of the NOPR TSD.
2. Government Regulatory Impact Model and Key Inputs
    DOE uses the GRIM to quantify the changes in cash flow due to 
amended standards that result in a higher or lower industry value. The 
GRIM uses a standard, annual discounted cash-flow analysis that 
incorporates manufacturer costs, manufacturer markups, shipments, and 
industry financial information as inputs. The GRIM models changes in 
costs, distribution of shipments, investments, and manufacturer margins 
that could result from an amended energy conservation standard. The 
GRIM spreadsheet uses the inputs to arrive at a series of annual cash 
flows, beginning in 2022 (the base year of the analysis) and continuing 
to 2056. DOE calculated INPVs by summing the stream of annual 
discounted cash flows during this period. For manufacturers of consumer 
clothes dryers, DOE used a real discount rate of 7.5 percent, which was 
derived from industry financials and then modified according to 
feedback received during manufacturer interviews.
    The GRIM calculates cash flows using standard accounting principles 
and compares changes in INPV between the no-new-standards case and each 
standards case. The difference in INPV between the no-new-standards 
case and a standards case represents the financial impact of the 
amended energy conservation standard on manufacturers. As discussed 
previously, DOE developed critical GRIM inputs using a number of 
sources, including publicly available data, results of the engineering 
analysis, projections from the shipments analysis, and information 
gathered from industry stakeholders during the course of manufacturer 
interviews. The GRIM results are presented in section V.B.2 of this 
document. Additional details about the GRIM, the discount rate, and 
other financial parameters can be found in chapter 12 of the NOPR TSD.
a. Manufacturer Production Costs
    Manufacturing more efficient equipment is typically more expensive 
than manufacturing baseline equipment due to the use of more complex 
components, which are typically more costly than baseline components. 
The changes in the MPCs of covered products can affect the revenues, 
gross margins, and cash flow of the industry. DOE models the 
relationship between efficiency and MPCs as a part of its engineering 
analysis. For a complete description of the MPCs, see chapter 5 of the 
NOPR TSD or section IV.C of this document.
b. Shipments Projections
    The GRIM estimates manufacturer revenues based on total unit 
shipment projections and the distribution of those shipments by 
efficiency level and by product class. 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 
projections derived from the shipments analysis from 2022 (the base 
year) to 2056 (the end year of the analysis period). See chapter 9 of 
the NOPR TSD for additional details or section IV.G of this document.
c. Product and Capital Conversion Costs
    Amended energy conservation standards could cause manufacturers to 
incur conversion costs to bring their production facilities and 
equipment designs into compliance. DOE evaluated the level of 
conversion-related expenditures that would be needed to comply with 
each considered efficiency level in each product class. For the MIA, 
DOE classified these conversion costs into two major groups: (1) 
capital conversion costs; and (2) product conversion costs. Capital 
conversion costs are investments in property, plant, and equipment 
necessary to adapt or change existing production facilities such that 
new compliant product designs can be fabricated and assembled. Product 
conversion costs are investments in research, development, testing, 
marketing, and other non-capitalized costs necessary to make product 
designs comply with amended energy conservation standards.
    DOE relied on manufacturer feedback to evaluate the level of 
capital and product conversion costs manufacturers would likely incur 
at the various TSLs. During confidential interviews, DOE asked 
manufacturers to estimate the capital conversion costs (e.g., changes 
in production processes, equipment, and tooling) to meet the various 
efficiency levels. DOE also asked manufacturers to estimate the 
redesign effort and engineering resources required at various 
efficiency levels to quantify the product conversion costs. Based on 
manufacturer feedback, DOE also estimated ``re-flooring'' costs 
associated with replacing obsolete display models in big-box stores 
(e.g., Lowe's, Home Depot, Best Buy) due to higher standards. Some 
manufacturers stated that with a new product release, big-box retailers 
discount outdated display models, and manufacturers share any losses 
associated with discounting the retail price. The estimated re-flooring 
costs for each efficiency level were incorporated into the product 
conversion cost estimates, as DOE modeled the re-flooring costs as a 
marketing expense.
    DOE reviewed the DOE CCMS \61\ database, U.S. market share 
estimates, and company characteristics to scale the company-specific 
conversion cost estimates to levels that represent the overall 
industry. First, DOE used its

[[Page 51771]]

CCMS database to identify original equipment manufacturers (``OEMs'') 
of the covered products. Next, DOE assessed each OEM's U.S. market 
share and product profile (e.g., estimated sales by product class and 
efficiency) for consumer clothes dryers. Finally, DOE estimated 
industry-level conversion cost estimates by scaling feedback from OEMs 
based on a combination of product offerings and U.S. market share 
estimates.
---------------------------------------------------------------------------

    \61\ U.S. Department of Energy's Compliance Certification 
Database is available at www.regulations.doe.gov/certification-data 
(last accessed October 8, 2021).
---------------------------------------------------------------------------

    DOE assumes all conversion-related investments occur between the 
year of publication of the final rule and the year by which 
manufacturers must comply with the new standard. The conversion cost 
figures used in the GRIM can be found in section V.B.2 of this 
document. For additional information on the estimated capital and 
product conversion costs, see chapter 12 of the NOPR TSD.
d. Manufacturer Markup Scenarios
    MSPs include direct manufacturing production costs (i.e., labor, 
materials, and overhead 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 for each product class and 
efficiency level. Modifying these manufacturer markups in the standards 
case yields different sets of impacts on manufacturers. For the MIA, 
DOE modeled two standards-case manufacturer markup scenarios to 
represent 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 scenario; and (2) a preservation of operating profit 
scenario. These scenarios lead to different manufacturer markup 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'' across all 
efficiency levels, which assumes that manufacturers would be able to 
maintain the same amount of profit as a percentage of revenues at all 
efficiency levels within a product class. As manufacturer production 
costs increase with efficiency, this scenario implies that the per-unit 
dollar profit will increase. DOE assumed a gross margin percentage of 
21 percent for all product classes.\62\ Manufacturers tend to believe 
it is optimistic to assume that they would be able to maintain the same 
gross margin percentage as their production costs increase, 
particularly for minimally efficient products. Therefore, this scenario 
represents a high bound to industry profitability under an amended 
energy conservation standard.
---------------------------------------------------------------------------

    \62\ The gross margin percentage of 21 percent is based on a 
manufacturer markup of 1.26.
---------------------------------------------------------------------------

    In the preservation of operating profit scenario, as the cost of 
production goes up under a standards case, manufacturers are generally 
required to reduce their manufacturer markups to a level that maintains 
base-case operating profit. DOE implemented this scenario in the GRIM 
by lowering the manufacturer markups at each TSL to yield approximately 
the same earnings before interest and taxes in the standards case as in 
the no-new-standards case in the year after the compliance date of the 
amended standards. The implicit assumption behind this scenario is that 
the industry can only maintain its operating profit in absolute dollars 
after the standard. A comparison of industry financial impacts under 
the two manufacturer markup scenarios is presented in section V.B.2.a 
of this document.
3. Manufacturer Interviews
    DOE interviewed manufacturers representing approximately 55 percent 
of domestic consumer clothes dryer industry shipments. Participants 
included domestic-based and foreign-based OEMs with a range of 
different product offerings and market shares.
    In interviews, DOE asked manufacturers to describe their major 
concerns regarding potential increases in energy conservation standards 
for consumer clothes dryers. The following section highlights 
manufacturer concerns that helped inform the projected potential 
impacts of an amended standard on the industry. Manufacturer interviews 
are conducted under non-disclosure agreements (``NDAs''), so DOE does 
not document these discussions in the same way that it does public 
comments in the comment summaries and in DOE's responses throughout the 
rest of this document.
a. Heat Pump Technology
    Some manufacturers expressed concerns about potential adverse 
impacts of a standard that could only be met using heat pump technology 
on product affordability, consumer satisfaction, profitability, and 
manufacturing capacity. Heat pump dryers currently cost more to produce 
than other electric dryers. In interviews, some manufacturers stated 
that a portion of consumers cannot afford the increased upfront cost 
and may forgo purchasing a new dryer or rely on alternatives such as 
laundromats or dryer rentals if the standard were to increase to a 
level that required the use of heat pump technology. Some manufacturers 
asserted, based on their market research and customer reviews of 
existing heat pump dryers, that consumers would be dissatisfied with a 
standard that could be achieved only by a heat pump dryer. These 
manufacturers cited instances of customer complaints about drying 
performance and longer cycle times that have been associated with 
certain implementations of heat pump technology.
    In interviews, several manufacturers also stated that heat pump 
technology represents a significant departure from vented electric 
dryers and would require new manufacturing plants or a total renovation 
of existing production facilities. Those manufacturers pointed out that 
heat pump dryers make up less than one percent of the consumer clothes 
dryer sales in the United States. The same manufacturers expressed 
concern about a potential shortage of products given the scale of 
investment, redesign efforts, and time constraints.
    Although some manufacturers expressed concerns about a standard 
that could only be met using heat pump technology, several 
manufacturers emphasized the benefits of heat pump technology. These 
manufacturers stated that heat pump dryers provide more energy savings 
and improved fabric care compared to conventional clothes dryers due to 
the lower drying temperatures associated with heat pump technology. 
Several manufacturers noted recent increases in domestic heat pump 
dryer sales and predicted that the trend would continue. These 
manufacturers also emphasized the increasing popularity of heat pump 
dryers in the European market, which they attributed to the 
proliferation of cost-competitive offerings, improved payback period, 
and shifting consumer preferences in that market.
    Although heat pump technology is still in the early stages of 
adoption in the United States, heat pump technology is commercially 
available on the market and can be incorporated into standard-size 
electric clothes dryers without the need to increase overall product 
size. As discussed in the engineering analysis, recent advances have 
resulted in heat pump products that do not require sacrifices in either 
dryness level or cycle time. DOE expects that that the U.S. market will 
continue to benefit from further advances in heat pump technology in 
the European

[[Page 51772]]

market, as manufacturers adapt those advances to products designed for 
the U.S. consumer. In addition, voluntary programs such as ENERGY STAR 
and various State incentive programs have the potential to 
significantly grow the market share of heat pump models. As discussed 
in the life-cycle cost analysis, as heat pump technology continues to 
gain market share over time, DOE expects that learning and experience 
by manufacturers will likely contribute to downward costs over time.
b. Preservation of Electromechanical Controls
    Some manufacturers expressed concern that higher energy 
conservation standards or requiring the use of the Appendix D2 test 
procedure would threaten the viability of dryers with electromechanical 
controls. In interviews, these manufacturers noted that some consumers 
prefer the simplicity of electromechanical control knobs and the lower 
price point associated with the lower production cost. Manufacturers 
also noted that eliminating electromechanical control dryers may raise 
the cost of baseline dryers, which would disproportionately impact low-
income consumers since they typically purchase low-cost dryers with 
electromechanical controls.
c. Cost Increases and Component Shortages
    Some manufacturers noted that increases in raw material prices, 
escalating shipping and transportation costs, and limited component 
availability over the last two years all affect manufacturer production 
costs. As a result, cost estimates based on historic 5-year averages 
would underestimate current production costs.
4. Discussion of MIA Comments
    In response to the preliminary analysis, AHAM commented on DOE's 
approach to analyzing cumulative regulatory burden. AHAM stated that 
the cumulative regulatory burden analysis should incorporate and 
quantify the costs to manufacturers associated with responding to and 
monitoring proposed test procedures and energy conservation standards. 
Additionally, AHAM urged DOE to incorporate the financial results of 
the cumulative regulatory burden analysis into the MIA, stating that 
this could be done by adding the combined cost of complying with 
multiple regulations into the product conversion costs in the GRIM. 
AHAM suggests performing a consolidated analysis of multiple 
regulations and notes that this approach is particularly important for 
related products like clothes washers and clothes dryers that are often 
designed, invested in, and sold together. In addition, AHAM noted other 
regulations impact consumer clothes dryer manufacturers such as 
commercial clothes washers, consumer refrigerator/freezers, 
dishwashers, room air conditioners, dehumidifiers, and portable air 
conditioners rulemakings. (AHAM, No. 23 at pp. 7-8)
    AHAM requested that DOE include the cost of monitoring test 
procedure and energy conservation standard rulemakings in its 
rulemaking analyses. (AHAM, No. 23 at p. 8) DOE requests AHAM provide 
the costs of monitoring, which would be independent from the conversion 
costs required to adapt product designs and manufacturing facilities to 
an amended standard, for DOE to determine whether these costs would 
materially affect the analysis. In particular, a summary of the job 
titles and annual hours per job title at a prototypical company would 
allow DOE to construct a detailed analysis of AHAM's monitoring costs.
    Additionally, AHAM encouraged DOE to incorporate product conversion 
costs from multiple rulemakings in the GRIM. (AHAM, No. 23 at p. 8) If 
DOE were to combine the conversion costs from multiple regulations, as 
requested, it would be appropriate to match the combined conversion 
costs against combined revenues of the regulated products. DOE is 
concerned that combined results would likely make it more difficult to 
discern the direct impact of the amended standard on manufacturers, 
particularly for rulemakings where there is only partial overlap of 
manufacturers. Conversion costs would be spread over a larger revenue 
base and result in less severe INPV impacts, when evaluated on a 
percent change basis.
    Regarding the specific case of consumer clothes washers and clothes 
dryers, DOE understands that these products are often designed as sets 
and sold together. Additionally, DOE has received feedback from 
industry that aligning the compliance data for potential amended 
standards across the two rulemakings would reduce overall compliance 
costs. DOE will investigate harmonizing the timing of the two 
rulemakings but must work within the constraints of EPCA, which 
determines both the timing of when rulemakings are initiated and the 
selection of compliance dates when an amended standard is adopted.
    Regarding the other ongoing rulemakings mentioned, DOE has not 
proposed amended energy conservation standards or compliance dates for 
most of the products identified. Table V.31 details the rulemakings and 
expected conversion expenses of Federal energy conservation standards, 
such as room air conditioners and portable air conditioners, affecting 
consumer clothes dryer OEMs. DOE will reassess and consider all 
relevant final rules contributing to cumulative regulatory burden in 
any subsequent analysis.
    In written comment, Whirlpool asserted that requiring the use of 
the appendix D2 test procedure would effectively eliminate 
electromechanical controlled dryers since electronic controls would 
very likely be needed to deliver accurate sensing and end-of-cycle 
detection. Whirlpool expressed a variety of concerns regarding the 
potential phase out of electromechanical controls. First, Whirlpool 
stated that phasing out electromechanical control dryers will 
disproportionately harm manufacturers, such as Whirlpool, with 
significant sales of electromechanical control dryers. Whirlpool noted 
that a transition from electromechanical to electronic controls would 
require a significant amount of engineering resources and capital 
investment to upgrade manufacturing facilities and production lines. 
Second, Whirlpool noted that electromechanical control dryers are often 
purchased by price-sensitive customers as these dryers are typically 
entry-level and low-cost. Whirlpool stated that they may be forced to 
make significant product changes and add product costs, which would 
subsequently increase the upfront cost for the consumer. Third, 
Whirlpool expressed concerns about manufacturers' ability to move to 
electronic controls considering the global supply chain shortage of 
semiconductors. Lastly, Whirlpool requested DOE consider the negative 
financial impact of potential standards on timer component suppliers. 
Demand for timer components is largely driven by dryers, so phasing out 
electromechanical controls might represent a significant business risk 
to these companies. Whirlpool stated at least one of these suppliers is 
a ``small U.S.-based company.'' (Whirlpool, No. 27 at pp. 4-6)
    DOE test data shows that requiring the use of the appendix D2 test 
procedure will not preclude the use of electromechanical controls. As 
discussed in section IV.C.1 of this document, DOE tested baseline 
models with electromechanical controls under appendix D2. The baseline 
efficiency levels in this NOPR represent a minimally compliant, basic-
construction consumer clothes dryer on the market, such as a dryer with

[[Page 51773]]

electromechanical controls. If tested under appendix D2, DOE does not 
expect dryers currently on the market to achieve a CEFD2 
rating below the baseline efficiency levels detailed in this NOPR.
    As for Whirlpool's broader concerns regarding the shift to 
electronic controls, DOE acknowledges that the GRIM is intended to 
represent the consumer clothes dryer industry as a whole. The impacts 
on individual manufacturers may vary from the industry average. DOE 
also recognizes that manufacturers with significant sales volumes of 
baseline efficiency dryers may experience differential impacts from 
amended standards relative to manufacturers specializing in high-
efficiency dryers. However, as many of the GRIM inputs (e.g., 
conversion costs, industry financials) account for U.S. market share 
weights, the GRIM is most reflective of large manufacturers like 
Whirlpool. Where possible, DOE suggests manufacturers provide company-
specific information about their consumer clothes dryer business so DOE 
can more accurately incorporate it into its modeling of the overall 
industry.
    Regarding the other concerns identified, DOE's analysis of 
conversion cost estimates is published in Table V.29 and the consumer 
sub-group analysis can be found in section V.B.1.b of this document. 
DOE appreciates the information about potential impacts to sub-
component suppliers, however, analyzing the impacts of proposed 
standards on a timer component supplier is outside the scope of this 
analysis.

K. Emissions Analysis

    The emissions analysis consists of two components. The first 
component estimates the effect of potential energy conservation 
standards on power sector and site (where applicable) combustion 
emissions of CO2, NOX, SO2, and Hg. 
The second component estimates the impacts of potential standards on 
emissions of two additional greenhouse gases, CH4 and 
N2O, as well as the reductions to emissions of other gases 
due to ``upstream'' activities in the fuel production chain. These 
upstream activities comprise extraction, processing, and transporting 
fuels to the site of combustion.
    The analysis of electric power sector emissions of CO2, 
NOX, SO2, and Hg uses emissions factors intended 
to represent the marginal impacts of the change in electricity 
consumption associated with amended or new standards. The methodology 
is based on results published for the AEO, including a set of side 
cases that implement a variety of efficiency-related policies. The 
methodology is described in appendix 13A in the NOPR TSD. The analysis 
presented in this notice uses projections from AEO2021.
    Power sector emissions of CH4 and N2O are 
estimated using Emission Factors for Greenhouse Gas Inventories 
published by the EPA.\63\
---------------------------------------------------------------------------

    \63\ Available at www.epa.gov/sites/production/files/2021-04/documents/emission-factors_apr2021.pdf (last accessed July 12, 
2021).
---------------------------------------------------------------------------

    The on-site operation of gas consumer clothes dryers requires 
combustion of fossil fuel and results in emissions of CO2, 
NOX, SO2, CH4, and N2O 
where these products are used. Site emissions of these gases were 
estimated using Emission Factors for Greenhouse Gas Inventories and, 
for NOX and SO2, emissions intensity factors from 
an EPA publication.\64\
---------------------------------------------------------------------------

    \64\ U.S. Environmental Protection Agency. External Combustion 
Sources. In Compilation of Air Pollutant Emission Factors. AP-42. 
Fifth Edition. Volume I: Stationary Point and Area Sources. Chapter 
1. Available at www.epa.gov/ttn/chief/ap42/ (last accessed 
July 12, 2021).
---------------------------------------------------------------------------

    FFC upstream emissions, which include emissions from fuel 
combustion during extraction, processing, and transportation of fuels, 
and ``fugitive'' emissions (direct leakage to the atmosphere) of 
CH4 and CO2, are estimated based on the 
methodology described in chapter 15 of the NOPR TSD.
    The emissions intensity factors are expressed in terms of physical 
units per megawatt-hours (``MWh'') or million British thermal units 
(``MMBtu'') of site energy savings. For power sector emissions, 
specific emissions intensity factors are calculated by sector and end 
use. Total emissions reductions are estimated using the energy savings 
calculated in the national impact analysis.
1. Air Quality Regulations Incorporated in DOE's Analysis
    DOE's no-new-standards case for the electric power sector reflects 
the AEO, which incorporates the projected impacts of existing air 
quality regulations on emissions. AEO2021 generally represents current 
legislation and environmental regulations, including recent government 
actions, that were in place at the time of preparation of AEO 2021, 
including the emissions control programs discussed in the following 
paragraphs.\65\
---------------------------------------------------------------------------

    \65\ For further information, see the Assumptions to AEO2021 
report that sets forth the major assumptions used to generate the 
projections in the Annual Energy Outlook. Available at www.eia.gov/outlooks/aeo/assumptions/ (last accessed November 8, 2021).
---------------------------------------------------------------------------

    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''). (42 U.S.C. 7651 et seq.) 
SO2 emissions from numerous States in the eastern half of 
the United States are also limited under the Cross-State Air Pollution 
Rule (``CSAPR''). 76 FR 48208 (Aug. 8, 2011). CSAPR requires these 
States to reduce certain emissions, including annual SO2 
emissions, and went into effect as of January 1, 2015.\66\ AEO2021 
incorporates implementation of CSAPR, including the update to the CSAPR 
ozone season program emission budgets and target dates issued in 2016. 
81 FR 74504 (Oct. 26, 2016). Compliance with CSAPR is flexible among 
EGUs and is enforced through the use of tradable emissions allowances. 
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 another regulated EGU.
---------------------------------------------------------------------------

    \66\ CSAPR requires states to address annual emissions of 
SO2 and NOX, precursors to the formation of 
fine particulate matter (PM2.5) pollution, in order to 
address the interstate transport of pollution with respect to the 
1997 and 2006 PM2.5 National Ambient Air Quality 
Standards (``NAAQS''). CSAPR also requires certain states to address 
the ozone season (May-September) emissions of NOX, a 
precursor to the formation of ozone pollution, in order to address 
the interstate transport of ozone pollution with respect to the 1997 
ozone NAAQS. 76 FR 48208 (Aug. 8, 2011). EPA subsequently issued a 
supplemental rule that included an additional five states in the 
CSAPR ozone season program; 76 FR 80760 (Dec. 27, 2011) 
(Supplemental Rule).
---------------------------------------------------------------------------

    However, beginning in 2016, SO2 emissions began to fall 
as a result of implementation the Mercury and Air Toxics Standards 
(``MATS'') for power plants. 77 FR 9304 (Feb. 16, 2012). In the MATS 
final 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 are being reduced as a result of the control 
technologies installed on coal-fired power plants to comply with the 
MATS requirements for acid gas. In order to continue operating, coal 
power plants must have either flue gas desulfurization or dry sorbent 
injection systems installed. Both technologies, which are used to 
reduce

[[Page 51774]]

acid gas emissions, also reduce SO2 emissions. Because of 
the emissions reductions under the MATS, 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 another regulated EGU. 
Therefore, energy conservation standards that decrease electricity 
generation would generally reduce SO2 emissions. DOE 
estimated SO2 emissions reduction using emissions factors 
based on AEO2021.
    CSAPR also established limits on NOX emissions for 
numerous States in the eastern half of the United States. Energy 
conservation standards would have little effect on NOX 
emissions in those States covered by CSAPR emissions limits if excess 
NOX emissions allowances resulting from the lower 
electricity demand could be used to permit offsetting increases in 
NOX emissions from other EGUs. In such case, NOx emissions 
would remain near the limit even if electricity generation goes down. A 
different case could possibly result, depending on the configuration of 
the power sector in the different regions and the need for allowances, 
such that NOX emissions might not remain at the limit in the 
case of lower electricity demand. In this case, energy conservation 
standards might reduce NOX emissions in covered States. 
Despite this possibility, DOE has chosen to be conservative in its 
analysis and has maintained the assumption that standards will not 
reduce NOX emissions in States covered by CSAPR. Energy 
conservation standards would be expected to reduce NOX 
emissions in the States not covered by CSAPR. DOE used AEO2021 data to 
derive NOX emissions factors for the group of States not 
covered by CSAPR. DOE used AEO2021 data to derive NOX 
emissions factors for the group of States not covered by CSAPR.
    The MATS limit mercury emissions from power plants, but they do not 
include emissions caps and, as such, DOE's energy conservation 
standards would be expected to slightly reduce Hg emissions. DOE 
estimated mercury emissions reduction using emissions factors based on 
AEO2021, which incorporates the MATS.

L. Monetizing Emissions Impacts

    As part of the development of this proposed rule, for the purpose 
of complying with the requirements of Executive Order 12866, DOE 
considered the estimated monetary benefits from the reduced emissions 
of CO2, CH4, N2O, NOX, and 
SO2 that are expected to result from each of the TSLs 
considered. In order to make this calculation analogous to the 
calculation of the NPV of consumer benefit, DOE considered the reduced 
emissions expected to result over the lifetime of products shipped in 
the projection period for each TSL. This section summarizes the basis 
for the values used for monetizing the emissions benefits and presents 
the values used for this NOPR.
    On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22-
30087) granted the Federal government's emergency motion for stay 
pending appeal of the February 11, 2022, preliminary injunction issued 
in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a result of 
the Fifth Circuit's order, the preliminary injunction is no longer in 
effect, pending resolution of the Federal government's appeal of that 
injunction or a further court order. Among other things, the 
preliminary injunction enjoined the defendants in that case from 
``adopting, employing, treating as binding, or relying upon'' the 
interim estimates of the social cost of greenhouse gases--which were 
issued by the Interagency Working Group on the Social Cost of 
Greenhouse Gases on February 26, 2021--to monetize the benefits of 
reducing greenhouse gas emissions. As reflected in this rule, DOE has 
reverted to its approach prior to the injunction and presents monetized 
greenhouse gas abatement benefits where appropriate and permissible 
under law. DOE requests comment on how to address the climate benefits 
of the proposal.
1. Monetization of Greenhouse Gas Emissions
    DOE estimates the monetized benefits of the reductions in emissions 
of CO2, CH4, and N2O by using a 
measure of the SC of each pollutant (e.g., SC-CO2). These 
estimates represent the monetary value of the net harm to society 
associated with a marginal increase in emissions of these pollutants in 
a given year, or the benefit of avoiding that increase. These estimates 
are intended to include (but are not limited to) climate-change-related 
changes in net agricultural productivity, human health, property 
damages from increased flood risk, disruption of energy systems, risk 
of conflict, environmental migration, and the value of ecosystem 
services. DOE exercises its own judgment in presenting monetized 
climate benefits as recommended by applicable Executive Orders, and DOE 
would reach the same conclusion presented in this notice in the absence 
of the social cost of greenhouse gases. That is, the social costs of 
greenhouse gases, whether measured using the February 2021 Interim 
Estimates presented by the Interagency Working Group on the Social Cost 
of Greenhouse Gases or by another means, did not affect the rule 
ultimately proposed by DOE.
    DOE estimated the global social benefits of CO2, 
CH4, and N2O reductions (i.e., SC-GHGs) using the 
estimates presented in the Technical Support Document: Social Cost of 
Carbon, Methane, and Nitrous Oxide Interim Estimates under Executive 
Order 13990 published in February 2021 by the IWG.\67\ The SC-GHGs is 
the monetary value of the net harm to society associated with a 
marginal increase in emissions in a given year, or the benefit of 
avoiding that increase. In principle, SC-GHGs includes the value of all 
climate change impacts, including (but not limited to) changes in net 
agricultural productivity, human health effects, property damage from 
increased flood risk and natural disasters, disruption of energy 
systems, risk of conflict, environmental migration, and the value of 
ecosystem services. The SC-GHGs therefore, reflects the societal value 
of reducing emissions of the gas in question by one metric ton. The SC-
GHGs is the theoretically appropriate value to use in conducting 
benefit-cost analyses of policies that affect CO2, 
N2O and CH4 emissions. As a member of the IWG 
involved in the development of the February 2021 SC-GHG TSD, the DOE 
agrees that the interim SC-GHG estimates represent the most appropriate 
estimate of the SC-GHG until revised estimates have been developed 
reflecting the latest, peer-reviewed science.
---------------------------------------------------------------------------

    \67\ See Interagency Working Group on Social Cost of Greenhouse 
Gases, Technical Support Document: Social Cost of Carbon, Methane, 
and Nitrous Oxide. Interim Estimates Under Executive Order 13990, 
Washington, DC, February 2021 (Available at: www.whitehouse.gov/wp-content/uploads/2021/02/TechnicalSupportDocument_SocialCostofCarbonMethaneNitrousOxide.pdf) 
(Last accessed Jan. 18, 2022).
---------------------------------------------------------------------------

    The SC-GHGs estimates presented here were developed over many 
years, using transparent process, peer-reviewed methodologies, the best 
science available at the time of that process, and with input from the 
public. Specifically, in 2009, the IWG, that included the DOE and other 
executive branch agencies and offices was established to ensure that 
agencies were using the best available science and to promote 
consistency in the social cost of carbon (SC-CO2) values 
used across agencies. The IWG published SC-CO2 estimates in 
2010 that were developed from an ensemble of three widely cited 
integrated assessment models (``IAMs'')

[[Page 51775]]

that estimate global climate damages using highly aggregated 
representations of climate processes and the global economy combined 
into a single modeling framework. The three IAMs were run using a 
common set of input assumptions in each model for future population, 
economic, and CO2 emissions growth, as well as equilibrium 
climate sensitivity--a measure of the globally averaged temperature 
response to increased atmospheric CO2 concentrations. These 
estimates were updated in 2013 based on new versions of each IAM. In 
August 2016 the IWG published estimates of the SC-CH4 and 
SC-N2O using methodologies that are consistent with the 
methodology underlying the SC-CO2 estimates. The modeling 
approach that extends the IWG SC-CO2 methodology to non-
CO2 GHGs has undergone multiple stages of peer review. The 
SC-CH4 and SC-N2O estimates were developed by 
Marten et al.\68\ and underwent a standard double-blind peer review 
process prior to journal publication. In 2015, as part of the response 
to public comments received to a 2013 solicitation for comments on the 
SC-CO2 estimates, the IWG announced a National Academies of 
Sciences, Engineering, and Medicine review of the SC-CO2 
estimates to offer advice on how to approach future updates to ensure 
that the estimates continue to reflect the best available science and 
methodologies. In January 2017, the National Academies released their 
final report, Valuing Climate Damages: Updating Estimation of the 
Social Cost of Carbon Dioxide, and recommended specific criteria for 
future updates to the SC-CO2 estimates, a modeling framework 
to satisfy the specified criteria, and both near-term updates and 
longer-term research needs pertaining to various components of the 
estimation process (National Academies, 2017).\69\ Shortly thereafter, 
in March 2017, President Trump issued Executive Order 13783, which 
disbanded the IWG, withdrew the previous TSDs, and directed agencies to 
ensure SC-CO2 estimates used in regulatory analyses are 
consistent with the guidance contained in OMB's Circular A-4, 
``including with respect to the consideration of domestic versus 
international impacts and the consideration of appropriate discount 
rates'' (E.O. 13783, Section 5(c)). Benefit-cost analyses following 
E.O. 13783 used SC-GHG estimates that attempted to focus on the U.S.-
specific share of climate change damages as estimated by the models and 
were calculated using two discount rates recommended by Circular A-4, 3 
percent and 7 percent. All other methodological decisions and model 
versions used in SC-GHG calculations remained the same as those used by 
the IWG in 2010 and 2013, respectively.
---------------------------------------------------------------------------

    \68\ Marten, A.L., E.A. Kopits, C.W. Griffiths, S.C. Newbold, 
and A. Wolverton. Incremental CH4 and N2O mitigation benefits 
consistent with the US Government's SC-CO2 estimates. Climate 
Policy. 2015. 15(2): pp. 272-298.
    \69\ National Academies of Sciences, Engineering, and Medicine. 
Valuing Climate Damages: Updating Estimation of the Social Cost of 
Carbon Dioxide. 2017. The National Academies Press: Washington, DC.
---------------------------------------------------------------------------

    On January 20, 2021, President Biden issued Executive Order 13990, 
which re-established the IWG and directed it to ensure that the U.S. 
Government's estimates of the social cost of carbon and other 
greenhouse gases reflect the best available science and the 
recommendations of the National Academies (2017). The IWG was tasked 
with first reviewing the SC-GHG estimates currently used in Federal 
analyses and publishing interim estimates within 30 days of the E.O. 
that reflect the full impact of GHG emissions, including by taking 
global damages into account. The interim SC-GHG estimates published in 
February 2021 are used here to estimate the climate benefits for this 
proposed rulemaking. The E.O. instructs the IWG to undertake a fuller 
update of the SC-GHG estimates by January 2022 that takes into 
consideration the advice of the National Academies (2017) and other 
recent scientific literature.
    The February 2021 SC-GHG TSD provides a complete discussion of the 
IWG's initial review conducted under E.O. 13990. In particular, the IWG 
found that the SC-GHG estimates used under E.O. 13783 fail to reflect 
the full impact of GHG emissions in multiple ways. First, the IWG found 
that the SC-GHG estimates used under E.O. 13783 fail to fully capture 
many climate impacts that affect the welfare of U.S. citizens and 
residents, and those impacts are better reflected by global measures of 
the SC-GHG. Examples of effects omitted from the E.O. 13783 estimates 
include direct effects on U.S. citizens, assets, and investments 
located abroad, supply chains, U.S. military assets and interests 
abroad, and tourism, and spillover pathways such as economic and 
political destabilization and global migration that can lead to adverse 
impacts on U.S. national security, public health, and humanitarian 
concerns. In addition, assessing the benefits of U.S. GHG mitigation 
activities requires consideration of how those actions may affect 
mitigation activities by other countries, as those international 
mitigation actions will provide a benefit to U.S. citizens and 
residents by mitigating climate impacts that affect U.S. citizens and 
residents. A wide range of scientific and economic experts have 
emphasized the issue of reciprocity as support for considering global 
damages of GHG emissions. If the United States does not consider 
impacts on other countries, it is difficult to convince other countries 
to consider the impacts of their emissions on the United States. The 
only way to achieve an efficient allocation of resources for emissions 
reduction on a global basis--and so benefit the U.S. and its citizens--
is for all countries to base their policies on global estimates of 
damages. As a member of the IWG involved in the development of the 
February 2021 SC-GHG TSD, DOE agrees with this assessment and, 
therefore, in this proposed rule DOE centers attention on a global 
measure of SC-GHG. This approach is the same as that taken in DOE 
regulatory analyses from 2012 through 2016. A robust estimate of 
climate damages that accrue only to U.S. citizens and residents does 
not currently exist in the literature. As explained in the February 
2021 TSD, existing estimates are both incomplete and an underestimate 
of total damages that accrue to the citizens and residents of the U.S. 
because they do not fully capture the regional interactions and 
spillovers discussed above, nor do they include all of the important 
physical, ecological, and economic impacts of climate change recognized 
in the climate change literature. As noted in the February 2021 SC-GHG 
TSD, the IWG will continue to review developments in the literature, 
including more robust methodologies for estimating a U.S.-specific SC-
GHG value, and explore ways to better inform the public of the full 
range of carbon impacts. As a member of the IWG, DOE will continue to 
follow developments in the literature pertaining to this issue.
    Second, the IWG found that the use of the social rate of return on 
capital (7 percent under current OMB Circular A-4 guidance) to discount 
the future benefits of reducing GHG emissions inappropriately 
underestimates the impacts of climate change for the purposes of 
estimating the SC-GHG. Consistent with the findings of the National 
Academies (2017) and the economic literature, the IWG continued to 
conclude that the consumption rate of interest is the theoretically 
appropriate discount rate in an intergenerational context (IWG 2010, 
2013, 2016a,

[[Page 51776]]

2016b),\70\ and recommended that discount rate uncertainty and relevant 
aspects of intergenerational ethical considerations be accounted for in 
selecting future discount rates.
---------------------------------------------------------------------------

    \70\ Interagency Working Group on Social Cost of Carbon. Social 
Cost of Carbon for Regulatory Impact Analysis under Executive Order 
12866. 2010. United States Government. (Available at: www.epa.gov/sites/default/files/2016-12/documents/scc_tsd_2010.pdf) (Last 
accessed April 15, 2022.); Interagency Working Group on Social Cost 
of Carbon. Technical Update of the Social Cost of Carbon for 
Regulatory Impact Analysis Under Executive Order 12866. 2013. 
(Available at: www.federalregister.gov/documents/2013/11/26/2013-28242/technical-support-document-technical-update-of-the-social-cost-of-carbon-for-regulatory-impact) (Last accessed April 15, 
2022.); Interagency Working Group on Social Cost of Greenhouse 
Gases, United States Government. Technical Support Document: 
Technical Update on the Social Cost of Carbon for Regulatory Impact 
Analysis-Under Executive Order 12866. August 2016. (Available at: 
www.epa.gov/sites/default/files/2016-12/documents/sc_co2_tsd_august_2016.pdf) (Last accessed January 18, 2022.); 
Interagency Working Group on Social Cost of Greenhouse Gases, United 
States Government. Addendum to Technical Support Document on Social 
Cost of Carbon for Regulatory Impact Analysis under Executive Order 
12866: Application of the Methodology to Estimate the Social Cost of 
Methane and the Social Cost of Nitrous Oxide. August 2016. 
(Available at: www.epa.gov/sites/default/files/2016-12/documents/addendum_to_sc-ghg_tsd_august_2016.pdf) (Last accessed January 18, 
2022.).
---------------------------------------------------------------------------

    Furthermore, the damage estimates developed for use in the SC-GHG 
are estimated in consumption-equivalent terms, and so an application of 
OMB Circular A-4's guidance for regulatory analysis would then use the 
consumption discount rate to calculate the SC-GHG. DOE agrees with this 
assessment and will continue to follow developments in the literature 
pertaining to this issue. DOE also notes that while OMB Circular A-4, 
as published in 2003, recommends using 3 percent and 7 percent discount 
rates as ``default'' values, Circular A-4 also reminds agencies that 
``different regulations may call for different emphases in the 
analysis, depending on the nature and complexity of the regulatory 
issues and the sensitivity of the benefit and cost estimates to the key 
assumptions.'' On discounting, Circular A-4 recognizes that ``special 
ethical considerations arise when comparing benefits and costs across 
generations,'' and Circular A-4 acknowledges that analyses may 
appropriately ``discount future costs and consumption benefits . . . at 
a lower rate than for intragenerational analysis.'' In the 2015 
Response to Comments on the Social Cost of Carbon for Regulatory Impact 
Analysis, OMB, DOE, and the other IWG members recognized that 
``Circular A-4 is a living document'' and ``the use of 7 percent is not 
considered appropriate for intergenerational discounting. There is wide 
support for this view in the academic literature, and it is recognized 
in Circular A-4 itself.'' Thus, DOE concludes that a 7-percent discount 
rate is not appropriate to apply to value the social cost of greenhouse 
gases in the analysis presented herein. In this analysis, to calculate 
the present and annualized values of climate benefits, DOE uses the 
same discount rate as the rate used to discount the value of damages 
from future GHG emissions, for internal consistency. That approach to 
discounting follows the same approach that the February 2021 TSD 
recommends ``to ensure internal consistency--i.e., future damages from 
climate change using the SC-GHG at 2.5 percent should be discounted to 
the base year of the analysis using the same 2.5-percent rate.'' DOE 
has also consulted the National Academies' 2017 recommendations on how 
SC-GHG estimates can ``be combined in RIAs with other cost and benefits 
estimates that may use different discount rates.'' The National 
Academies reviewed ``several options,'' including ``presenting all 
discount rate combinations of other costs and benefits with [SC-GHG] 
estimates.''
    As a member of the IWG involved in the development of the February 
2021 SC-GHG TSD, DOE agrees with this assessment and will continue to 
follow developments in the literature pertaining to this issue.
    While the IWG works to assess how best to incorporate the latest, 
peer reviewed science to develop an updated set of SC-GHG estimates, it 
set the interim estimates to be the most recent estimates developed by 
the IWG prior to the group being disbanded in 2017. The estimates rely 
on the same models and harmonized inputs and are calculated using a 
range of discount rates. As explained in the February 2021 SC-GHG TSD, 
the IWG has recommended that agencies revert to the same set of four 
values drawn from the SC-GHG distributions based on three discount 
rates as were used in regulatory analyses between 2010 and 2016 and 
subject to public comment. For each discount rate, the IWG combined the 
distributions across models and socioeconomic emissions scenarios 
(applying equal weight to each) and then selected a set of four values 
recommended for use in benefit-cost analyses: an average value 
resulting from the model runs for each of three discount rates (2.5 
percent, 3 percent, and 5 percent), plus a fourth value, selected as 
the 95th percentile of estimates based on a 3 percent discount rate. 
The fourth value was included to provide information on potentially 
higher-than-expected economic impacts from climate change. As explained 
in the February 2021 SC-GHG TSD, and DOE agrees, this update reflects 
the immediate need to have an operational SC-GHG for use in regulatory 
benefit-cost analyses and other applications that was developed using a 
transparent process, peer-reviewed methodologies, and the science 
available at the time of that process. Those estimates were subject to 
public comment in the context of dozens of proposed rulemakings as well 
as in a dedicated public comment period in 2013.
    There are a number of limitations and uncertainties associated with 
the SC-GHG estimates. First, the current scientific and economic 
understanding of discounting approaches suggests discount rates 
appropriate for intergenerational analysis in the context of climate 
change are likely to be less than 3 percent, near 2 percent or 
lower.\71\ Second, the IAMs used to produce these interim estimates do 
not include all of the important physical, ecological, and economic 
impacts of climate change recognized in the climate change literature 
and the science underlying their ``damage functions''--i.e., the core 
parts of the IAMs that map global mean temperature changes and other 
physical impacts of climate change into economic (both market and 
nonmarket) damages--lags behind the most recent research. For example, 
limitations include the incomplete treatment of catastrophic and non-
catastrophic impacts in the integrated assessment models, their 
incomplete treatment of adaptation and technological change, the 
incomplete way in which inter-regional and intersectoral linkages are 
modeled, uncertainty in the extrapolation of damages to high 
temperatures, and inadequate representation of the relationship between 
the discount rate and uncertainty in economic growth over long time 
horizons. Likewise, the socioeconomic and emissions scenarios used as 
inputs to the models do not reflect new information from the last 
decade of scenario generation or the full range of projections. The 
modeling limitations do not all work in the same direction in terms of 
their influence on the SC-CO2 estimates. However, as 
discussed in the February 2021 TSD, the IWG has concluded that, taken 
together,

[[Page 51777]]

the limitations suggest that the interim SC-GHG estimates used in this 
proposed rule likely underestimate the damages from GHG emissions. DOE 
concurs with this assessment.
---------------------------------------------------------------------------

    \71\ Interagency Working Group on Social Cost of Greenhouse 
Gases (IWG). 2021. Technical Support Document: Social Cost of 
Carbon, Methane, and Nitrous Oxide Interim Estimates under Executive 
Order 13990. February. United States Government. (Available at: 
www.whitehouse.gov/briefing-room/blog/2021/02/26/a-return-to-science-evidence-based-estimates-of-the-benefits-of-reducing-climate-pollution/) (Last accessed Jan. 18, 2022).
---------------------------------------------------------------------------

    DOE's derivations of the SC-GHG (i.e., SC-CO2, SC-
N2O, and SC-CH4) values used for this NOPR are 
discussed in the following sections, and the results of DOE's analyses 
estimating the benefits of the reductions in emissions of these 
pollutants are presented in section V.B.6 of this document.
a. Social Cost of Carbon
    The SC-CO2 values used for this NOPR were based on the 
values presented in the 2021 update from the IWG's February 2021 TSD. 
Table IV.34 shows the updated sets of SC-CO2 estimates from 
the latest interagency update in 5-year increments from 2020 to 2050. 
The full set of annual values used is presented in appendix 14A of the 
NOPR TSD. For purposes of capturing the uncertainties involved in 
regulatory impact analysis, DOE has determined it is appropriate to 
include all four sets of SC-CO2 values, as recommended by 
the IWG.\72\
---------------------------------------------------------------------------

    \72\ For example, the February 2021 TSD discusses how the 
understanding of discounting approaches suggests that discount rates 
appropriate for intergenerational analysis in the context of climate 
change may be lower than 3 percent.

      Table IV.34--Annual SC-CO2 Values From 2021 Interagency Update, 2020-2050 (2020$ per Metric Ton CO2)
----------------------------------------------------------------------------------------------------------------
                                                                           Discount rate
                                                 ---------------------------------------------------------------
                                                        5%              3%             2.5%             3%
                      Year                       ---------------------------------------------------------------
                                                                                                       95th
                                                      Average         Average         Average       percentile
----------------------------------------------------------------------------------------------------------------
2020............................................              14              51              76             152
2025............................................              17              56              83             169
2030............................................              19              62              89             187
2035............................................              22              67              96             206
2040............................................              25              73             103             225
2045............................................              28              79             110             242
2050............................................              32              85             116             260
----------------------------------------------------------------------------------------------------------------

    In calculating the potential global benefits resulting from reduced 
CO2 emissions, DOE used the values from the 2021 interagency 
report, adjusted to 2020$ using the implicit price deflator for gross 
domestic product (``GDP'') from the Bureau of Economic Analysis. For 
2051 to 2070, DOE used estimates published by EPA, adjusted to 2020$. 
These estimates are based on methods, assumptions, and parameters 
identical to the 2020-2050 estimates published by the IWG. DOE expects 
additional climate benefits to accrue for any longer-life consumer 
clothes dryers post 2070, but a lack of available SC-CO2 
estimates for emissions years beyond 2070 prevents DOE from monetizing 
these potential benefits in this analysis. If further analysis of 
monetized climate benefits beyond 2070 becomes available prior to the 
publication of the final rule, DOE will include that analysis in the 
final rule.
    DOE multiplied the CO2 emissions reduction estimated for 
each year by the SC-CO2 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 SC-
CO2 values in each case. See chapter 13 for the annual 
emissions reduction. See appendix 14A for the annual SC-CO2 
values.
b. Social Cost of Methane and Nitrous Oxide
    The SC-CH4 and SC-N2O values used for this 
NOPR were generated using the values presented in the 2021 update from 
the IWG.\73\ Table IV.35 shows the updated sets of SC-CH4 
and SC-N2O estimates from the latest interagency update in 
5-year increments from 2020 to 2050. The full set of annual values used 
is presented in appendix 14A of the NOPR TSD. To capture the 
uncertainties involved in regulatory impact analysis, DOE has 
determined it is appropriate to include all four sets of SC-
CH4 and SC-N2O values, as recommended by the IWG. 
DOE used the same approach described above for the SC-CO2 
for values after 2050.
---------------------------------------------------------------------------

    \73\ See Interagency Working Group on Social Cost of Greenhouse 
Gases, Technical Support Document: Social Cost of Carbon, Methane, 
and Nitrous Oxide. Interim Estimates Under Executive Order 13990, 
Washington, DC (February 2021) (Available at: www.whitehouse.gov/wp-content/uploads/2021/02/TechnicalSupportDocument_SocialCostofCarbonMethaneNitrousOxide.pdf) 
(Last accessed Jan. 18, 2022).

                                  Table IV.35--Annual SC-CH4 and SC-N2O Values From 2021 Interagency Update, 2020-2050
                                                                 [2020$ per metric ton]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        SC-CH4                                              SC-N2O
                                                 -------------------------------------------------------------------------------------------------------
                                                              Discount rate and statistic                         Discount rate and statistic
                                                 -------------------------------------------------------------------------------------------------------
                      Year                             5%           3%          2.5%          3%           5%           3%          2.5%          3%
                                                 -------------------------------------------------------------------------------------------------------
                                                                                             95th                                                95th
                                                    Average      Average      Average     percentile    Average      Average      Average     percentile
--------------------------------------------------------------------------------------------------------------------------------------------------------
2020............................................          670         1500         2000         3900         5800        18000        27000        48000
2025............................................          800         1700         2200         4500         6800        21000        30000        54000
2030............................................          940         2000         2500         5200         7800        23000        33000        60000
2035............................................         1100         2200         2800         6000         9000        25000        36000        67000
2040............................................         1300         2500         3100         6700        10000        28000        39000        74000
2045............................................         1500         2800         3500         7500        12000        30000        42000        81000
2050............................................         1700         3100         3800         8200        13000        33000        45000        88000
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 51778]]

    DOE multiplied the CH4 and N2O emissions 
reduction estimated for each year by the SC-CH4 and SC-
N2O estimates for that year in each of the cases. To 
calculate a present value of the stream of monetary values, DOE 
discounted the values in each of the cases using the specific discount 
rate that had been used to obtain the SC-CH4 and SC-
N2O estimates in each case. See chapter 13 for the annual 
emissions reduction. See appendix 14A for the annual SC-CH4 
and SC-N2O values.
2. Monetization of Other Air Pollutants
    DOE estimated the monetized value of NOX and 
SO2 emissions reductions from electricity generation using 
the latest benefit-per-ton estimates for that sector from the EPA's 
Benefits Mapping and Analysis Program.\74\ DOE used EPA's values for 
PM2.5-related benefits associated with NOX and 
SO2 and for ozone-related benefits associated with 
NOX for 2025, 2030, 2035 and 2040, calculated with discount 
rates of 3 percent and 7 percent. DOE used linear interpolation to 
define values for the years not given in the 2025 to 2040 period; for 
years beyond 2040 the values are held constant. DOE derived values 
specific to the sector for consumer clothes dryers using a method 
described in appendix 14A of the NOPR TSD.
---------------------------------------------------------------------------

    \74\ U.S. Environmental Protection Agency, Estimating the 
Benefit per Ton of Reducing PM2.5 Precursors from 21 Sectors. 
Available at: www.epa.gov/benmap/estimating-benefit-ton-reducing-pm25-precursors-21-sectors.
---------------------------------------------------------------------------

    DOE also estimated the monetized value of NOX and 
SO2 emissions reductions from site use of natural gas in 
consumer clothes dryers using benefit-per-ton estimates from the EPA's 
Benefits Mapping and Analysis Program. Although none of the sectors 
covered by EPA refers specifically to residential and commercial 
buildings, the sector called ``area sources'' would be a reasonable 
proxy for residential and commercial buildings.\75\ The EPA document 
provides high and low estimates for 2025 and 2030 at 3- and 7-percent 
discount rates.\76\ DOE used the same linear interpolation and 
extrapolation as it did with the values for electricity generation.
---------------------------------------------------------------------------

    \75\ ``Area sources'' represents all emission sources for which 
states do not have exact (point) locations in their emissions 
inventories. Because exact locations would tend to be associated 
with larger sources, ``area sources'' would be fairly representative 
of small dispersed sources like homes and businesses.
    \76\ ``Area sources'' are a category in the 2018 document from 
EPA, but are not used in the 2021 document cited above. Available 
at: www.epa.gov/sites/default/files/2018-02/documents/sourceapportionmentbpttsd_2018.pdf.
---------------------------------------------------------------------------

    DOE multiplied the site emissions reduction (in tons) in each year 
by the associated $/ton values, and then discounted each series using 
discount rates of 3 percent and 7 percent as appropriate.

M. Utility Impact Analysis

    The utility impact analysis estimates several effects on the 
electric power generation industry that would result from the adoption 
of new or amended energy conservation standards. The utility impact 
analysis estimates the changes in installed electrical capacity and 
generation that would result for each TSL. The analysis is based on 
published output from the NEMS associated with AEO2021. NEMS produces 
the AEO Reference case, as well as a number of side cases that estimate 
the economy-wide impacts of changes to energy supply and demand. For 
the current analysis, impacts are quantified by comparing the levels of 
electricity sector generation, installed capacity, fuel consumption and 
emissions in the AEO2020 Reference case and various side cases. Details 
of the methodology are provided in the appendices to chapters 13 and 15 
of the NOPR TSD.
    The output of this analysis is a set of time-dependent coefficients 
that capture the change in electricity generation, primary fuel 
consumption, installed capacity and power sector emissions due to a 
unit reduction in demand for a given end use. These coefficients are 
multiplied by the stream of electricity savings calculated in the NIA 
to provide estimates of selected utility impacts of potential new or 
amended energy conservation standards.

N. Employment Impact Analysis

    DOE considers employment impacts in the domestic economy as one 
factor in selecting a proposed standard. Employment impacts from new or 
amended energy conservation standards include both direct and indirect 
impacts. Direct employment impacts are any changes in the number of 
production and non-production employees of manufacturers of the 
products subject to standards.\77\ 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 net jobs created or 
eliminated in the national economy, other than in the manufacturing 
sector being regulated, caused by (1) reduced spending by consumers on 
energy, (2) reduced spending on new energy supply by the utility 
industry, (3) increased consumer spending on the products to which the 
new standards apply and other goods and services, and (4) the effects 
of those three factors throughout the economy.
---------------------------------------------------------------------------

    \77\ As defined in the U.S. Census Bureau's 2016 Annual Survey 
of Manufactures, production workers include ``Workers (up through 
the line-supervisor level) engaged in fabricating, processing, 
assembling, inspecting, receiving, packing, warehousing, shipping 
(but not delivering), maintenance, repair, janitorial, guard 
services, product development, auxiliary production for plant's own 
use (e.g., power plant), record keeping, and other closely 
associated services (including truck drivers delivering ready-mixed 
concrete)'' Non-production workers are defined as ``Supervision 
above line-supervisor level, sales (including a driver salesperson), 
sales delivery (truck drivers and helpers), advertising, credit, 
collection, installation, and servicing of own products, clerical 
and routine office functions, executive, purchasing, finance, legal, 
personnel (including cafeteria, etc.), professional and technical.''
---------------------------------------------------------------------------

    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 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.\78\ There are many reasons for these 
differences, including wage differences and the fact that the utility 
sector is more capital-intensive and less labor-intensive than other 
sectors. Energy conservation standards have the effect of reducing 
consumer utility bills. Because reduced consumer 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, the BLS data suggest that net national employment may 
increase due to shifts in economic activity resulting from energy 
conservation standards.
---------------------------------------------------------------------------

    \78\ See U.S. Department of Commerce-Bureau of Economic 
Analysis. Regional Multipliers: A User Handbook for the Regional 
Input-Output Modeling System (RIMS II). 1997. U.S. Government 
Printing Office: Washington, DC. Available at www.bea.gov/scb/pdf/regional/perinc/meth/rims2.pdf (last accessed November 9, 2021).
---------------------------------------------------------------------------

    DOE estimated indirect national employment impacts for the standard 
levels considered in this NOPR using an input/output model of the U.S. 
economy called Impact of Sector Energy

[[Page 51779]]

Technologies version 4 (``ImSET'').\79\ 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 187 sectors most relevant to 
industrial, commercial, and residential building energy use.
---------------------------------------------------------------------------

    \79\ Livingston, O.V., S.R. Bender, M.J. Scott, and R.W. 
Schultz. ImSET 4.0: Impact of Sector Energy Technologies Model 
Description and User Guide. 2015. Pacific Northwest National 
Laboratory: Richland, WA. PNNL-24563.
---------------------------------------------------------------------------

    DOE notes that ImSET is not a general equilibrium forecasting 
model, and that 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 this rule. Therefore, DOE used ImSET only to generate results 
for near-term timeframes (2027-2033), where these uncertainties are 
reduced. For more details on the employment impact analysis, see 
chapter 16 of the NOPR TSD.

V. Analytical Results and Conclusions

    The following section addresses the results from DOE's analyses 
with respect to the considered energy conservation standards for 
consumer clothes dryers. It addresses the TSLs examined by DOE, the 
projected impacts of each of these levels if adopted as energy 
conservation standards for consumer clothes dryers, and the standards 
levels that DOE is proposing to adopt in this NOPR. Additional details 
regarding DOE's analyses are contained in the NOPR TSD supporting this 
document.

A. Trial Standard Levels

    In general, DOE typically evaluates potential amended standards for 
products and equipment at the product class level and by grouping 
select individual efficiency levels for each class into TSLs. Use of 
TSLs allows DOE to identify and consider manufacturer cost interactions 
between the equipment classes, to the extent that there are such 
interactions, and market cross elasticity from consumer purchasing 
decisions that may change when different standard levels are set. In 
addition, the use of TSLs allows DOE to account for shifts in 
manufacturing practices, such as consolidation or expansion of 
manufacturing lines that may occur as a result of differential 
efficiency levels set for different product classes. In the case of 
consumer clothes dryers, DOE did not find any cross elasticities in the 
marketplace and DOE does not believe consumers would modify their 
purchasing decisions to change to different categories of consumer 
clothes dryers due to the imposition of standards. DOE also believes 
that manufacturers will continue producing compact and standard size 
clothes dryers on different product lines due to their significantly 
different platforms and production quantities. DOE presents the results 
for the TSLs in this document, while the results for all efficiency 
levels that DOE analyzed are in the NOPR TSD. Table V.1 presents the 
TSLs and the corresponding efficiency levels that DOE has identified 
for potential amended energy conservation standards for consumer 
clothes dryers. TSL 6 represents the maximum technologically feasible 
(``max-tech'') energy efficiency for all product classes. TSL 5 
represents the maximum national energy savings with positive NPV. TSL 4 
represents the maximum national energy savings with simple PBP less 
than 4 years. TSL 3 represents the intermediate efficiency level 
between TSL 2 and TSL 4. TSL 2 corresponds to efficiency level with 
automatic termination control system for product class (``PC'')1 to PC6 
and high-speed spin for PC7. TSL 1 corresponds to efficiency level with 
electronic controls for all product classes. DOE constructed the TSLs 
for this NOPR to include ELs representative of ELs with similar 
characteristics (i.e., using similar technologies and/or efficiencies, 
and having roughly comparable equipment availability). The use of 
representative ELs provided for greater distinction between the TSLs. 
While representative ELs were included in the TSLs, DOE considered all 
efficiency levels as part of its analysis but did not include all 
efficiency levels in the TSLs.\80\
---------------------------------------------------------------------------

    \80\ Efficiency levels that were analyzed for this NOPR are 
discussed in section IV.C.3 of this document. Results by efficiency 
level are presented in the NOPR TSD chapters 8 and 12.

                                               Table V.1--Trial Standard Levels for Consumer Clothes Dryer
--------------------------------------------------------------------------------------------------------------------------------------------------------
            Product class                        TSL 1                TSL 2           TSL 3               TSL 4                TSL 5           TSL 6
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Efficiency level and representative CEFD2 (lb/kWh)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Electric Standard....................  1 (2.68)................        3 (3.27)        4 (3.93)  5 (4.21)...............        7 (7.39)        7 (7.39)
Electric Compact (120V)..............  1 (3.15)................        3 (4.28)        4 (4.33)  4 (4.33)...............        5 (4.63)        6 (6.37)
Vented Electric Compact (240V).......  1 (2.44)................        3 (3.30)        4 (3.57)  4 (3.57)...............        5 (3.82)        6 (3.91)
Vented Gas Standard..................  1 (2.44)................        2 (3.00)        3 (3.48)  3 (3.48)...............        3 (3.48)        4 (3.83)
Vented Gas Compact...................  1 (2.02)................        2 (2.49)        1 (2.02)  Baseline (1.66)........        3 (2.89)        4 (3.17)
Ventless Electric Compact (240V).....  Baseline (2.03).........        1 (2.68)        1 (2.68)  1 (2.68)...............        1 (2.68)        2 (6.80)
Ventless Electric Combination Washer-  Baseline (2.27).........        1 (2.33)        1 (2.33)  1 (2.33)...............        1 (2.33)        2 (4.01)
 Dryer.
--------------------------------------------------------------------------------------------------------------------------------------------------------

B. Economic Justification and Energy Savings

1. Economic Impacts on Individual Consumers
    DOE analyzed the economic impacts on consumers of consumer clothes 
dryers by looking at the effects that potential amended standards at 
each TSL would have on the LCC and PBP. DOE also examined the impacts 
of potential standards on selected consumer subgroups. These analyses 
are discussed in the following sections.
a. Life-Cycle Cost and Payback Period
    In general, higher-efficiency products affect consumers in two 
ways: (1) purchase price increases and (2) annual operating costs 
decrease. Inputs used for calculating the LCC and PBP include total 
installed costs (i.e., product price plus installation costs), and 
operating costs (i.e., annual energy use, energy prices, energy price 
trends, repair costs, and maintenance costs). The LCC calculation also 
uses product lifetime

[[Page 51780]]

and a discount rate. Chapter 8 of the NOPR TSD provides detailed 
information on the LCC and PBP analyses.
    Table V.2 through Table V.15 show the LCC and PBP results for the 
TSLs considered for each product class. In the first of each pair of 
tables, the simple payback is measured relative to the baseline 
product. In the second table, impacts are measured relative to the 
efficiency distribution in the no-new-standards case in the compliance 
year (see section IV.F.8 of this document). Because some consumers 
purchase products with higher efficiency in the no-new-standards case, 
the average savings are less than the difference between the average 
LCC of the baseline product and the average LCC at each TSL. The 
savings refer only to consumers who are affected by a standard at a 
given TSL. Those who already purchase a product with efficiency at or 
above a given TSL are not affected. Consumers for whom the LCC 
increases at a given TSL experience a net cost.

                                                      Table V.2--Average LCC and PBP Results for Electric Standard Consumer Clothes Dryers
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                       Average costs (2020$)
                                                CEFD2 (lb/kWh)                                   ---------------------------------------------------------------- Simple payback      Average
                      TSL                                               Efficiency level                           First year's      Lifetime                         (years)        lifetime
                                                                                                  Installed cost  operating cost  operating cost        LCC                           (years)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          2.20  Baseline........................            $607            $147          $1,567          $2,174  ..............            14.0
1.............................................            2.68  1...............................             625             122           1,301           1,926             0.7            14.0
2.............................................            3.27  3...............................             634             101           1,085           1,719             0.6            14.0
3.............................................            3.93  4...............................             641            85.3             919           1,560             0.6            14.0
4.............................................            4.21  5...............................             721            80.3             865           1,587             1.7            14.0
5, 6..........................................            7.39  7...............................             996            50.0             537           1,533             4.0            14.0
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative to the baseline product.


   Table V.3--Average LCC Savings Relative to the No-New-Standards Case for Electric Standard Consumer Clothes
                                                     Dryers
----------------------------------------------------------------------------------------------------------------
                                                                                Life-cycle cost savings
                                                                     -------------------------------------------
                 TSL                  CEFD2 (lb/kWh)    Efficiency                          Percent of consumers
                                                           level       Average LCC savings   that experience net
                                                                            * (2020$)             cost (%)
----------------------------------------------------------------------------------------------------------------
1...................................            2.68               1                  $252                  0.32
2...................................            3.27               3                   439                  0.16
3...................................            3.93               4                   578                  0.11
4...................................            4.21               5                   182                  53.5
5, 6................................            7.39               7                   230                  53.1
----------------------------------------------------------------------------------------------------------------
* The savings represent the average LCC for affected consumers.


                                                   Table V.4--Average LCC and PBP Results for Electric Compact (120V) Consumer Clothes Dryers
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                       Average costs (2020$)
                                                CEFD2 (lb/kWh)                                   ---------------------------------------------------------------- Simple payback      Average
                      TSL                                               Efficiency level                           First year's      Lifetime                         (years)        lifetime
                                                                                                  Installed cost  operating cost  operating cost        LCC                           (years)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          2.36  Baseline........................            $635           $54.1            $383          $1,206  ..............            14.0
1.............................................            3.15  1...............................             657            41.0             297           1,090            1. 7            14.0
2.............................................            4.28  3...............................             670            30.7             228             995             1.5            14.0
3, 4..........................................            4.33  4...............................             678            30.4             226             999             1.8            14.0
5.............................................            4.63  5...............................             770            28.6             215           1,073             5.3            14.0
6.............................................            6.37  6...............................             993            21.6             169           1,222            11.0            14.0
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative to the baseline product.


    Table V.5--Average LCC Savings Relative to the No-New-Standards Case for Electric Compact (120V) Consumer
                                                 Clothes Dryers
----------------------------------------------------------------------------------------------------------------
                                                                                Life-cycle cost savings
                                                                     -------------------------------------------
                 TSL                  CEFD2 (lb/kWh)    Efficiency                          Percent of consumers
                                                           level       Average LCC savings   that experience net
                                                                            * (2020$)             cost (%)
----------------------------------------------------------------------------------------------------------------
1...................................            3.15               1                  $115                  5.66
2...................................            4.28               3                   194                  4.46
3, 4................................            4.33               4                   160                  21.6
5...................................            4.63               5                  86.3                  53.0

[[Page 51781]]

 
6...................................            6.37               6                (62.6)                  76.3
----------------------------------------------------------------------------------------------------------------
* The savings represent the average LCC for affected consumers. Negative values denoted in parentheses.


                                                Table V.6--Average LCC and PBP Results for Vented Electric Compact (240V) Consumer Clothes Dryers
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                       Average costs (2020$)
                                                CEFD2 (lb/kWh)                                   ---------------------------------------------------------------- Simple payback      Average
                      TSL                                               Efficiency level                           First year's      Lifetime                         (years)        lifetime
                                                                                                  Installed cost  operating cost  operating cost        LCC                           (years)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          2.00  Baseline........................            $636           $64.4            $682          $1,318  ..............            14.0
1.............................................            2.44  1...............................             659            53.3             565           1,223             2.0            14.0
2.............................................            3.30  3...............................             672            40.2             426           1,098             1.5            14.0
3, 4..........................................            3.57  4...............................             680            37.4             396           1,076             1.6            14.0
5.............................................            3.82  5...............................             772            35.2             373           1,145             4.7            14.0
6.............................................            3.91  6...............................             995            34.8             368           1,363            12.1            14.0
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative to the baseline product.


Table V.7--Average LCC Savings Relative to the No-New-Standards Case for Vented Electric Compact (240V) Consumer
                                                 Clothes Dryers
----------------------------------------------------------------------------------------------------------------
                                                                                Life-cycle cost savings
                                                                     -------------------------------------------
                 TSL                  CEFD2 (lb/kWh)    Efficiency                          Percent of consumers
                                                           level       Average LCC savings   that experience net
                                                                            * (2020$)             cost (%)
----------------------------------------------------------------------------------------------------------------
1...................................            2.44               1                 $94.1                  8.63
2...................................            3.30               3                   201                  4.35
3, 4................................            3.57               4                   192                  8.37
5...................................            3.82               5                   123                  47.0
6...................................            3.91               6                (94.8)                  79.6
----------------------------------------------------------------------------------------------------------------
* The savings represent the average LCC for affected consumers. Negative values denoted in parentheses.


                                                     Table V.8--Average LCC and PBP Results for Vented Gas Standard Consumer Clothes Dryers
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                       Average costs (2020$)
                                                CEFD2 (lb/kWh)                                   ---------------------------------------------------------------- Simple payback      Average
                      TSL                                               Efficiency level                           First year's      Lifetime                         (years)        lifetime
                                                                                                  Installed cost  operating cost  operating cost        LCC                           (years)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          2.00  Baseline........................            $740           $60.0            $689          $1,429              --            14.0
1.............................................            2.44  1...............................             763            51.5             586           1,350             2.8            14.0
2.............................................            3.00  2...............................             768            42.1             478           1,246             1.6            14.0
3, 4, 5.......................................            3.48  3...............................             783            37.7             426           1,209             1.9            14.0
6.............................................            3.83  4...............................             863            37.5             421           1,284             5.5            14.0
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative to the baseline product.


  Table V.9--Average LCC Savings Relative to the No-New-Standards Case for Vented Gas Standard Consumer Clothes
                                                     Dryers
----------------------------------------------------------------------------------------------------------------
                                                                                Life-cycle cost savings
                                                                     -------------------------------------------
                 TSL                  CEFD2 (lb/kWh)    Efficiency                          Percent of consumers
                                                           level       Average LCC savings   that experience net
                                                                            * (2020$)             cost (%)
----------------------------------------------------------------------------------------------------------------
1...................................            2.44               1                 $77.7                  6.04
2...................................            3.00               2                   174                  1.66
3, 4, 5.............................            3.48               3                   198                  3.74

[[Page 51782]]

 
6...................................            3.83               4                  43.0                  59.3
----------------------------------------------------------------------------------------------------------------
* The savings represent the average LCC for affected consumers.


                                                     Table V.10--Average LCC and PBP Results for Vented Gas Compact Consumer Clothes Dryers
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                       Average costs (2020$)
                                                CEFD2 (lb/kWh)                                   ---------------------------------------------------------------- Simple payback      Average
                      TSL                                               Efficiency level                           First year's      Lifetime                         (years)        lifetime
                                                                                                  Installed cost  operating cost  operating cost        LCC                           (years)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          1.66  Baseline........................            $790           $27.4            $308          $1,098  ..............            14.0
1, 3..........................................            2.02  1...............................             810            23.4             263           1,073             5.1            14.0
2.............................................            2.49  2...............................             817            23.2             258           1,075             6.4            14.0
4.............................................            1.66  Baseline........................             790            27.4             308           1,098  ..............            14.0
5.............................................            2.89  3...............................             834            21.2             235           1,069             7.1            14.0
6.............................................            3.17  4...............................             926            19.0             211           1,137            16.3            14.0
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative to the baseline product.


  Table V.11--Average LCC Savings Relative to the No-New-Standards Case for Vented Gas Compact Consumer Clothes
                                                     Dryers
----------------------------------------------------------------------------------------------------------------
                                                                                Life-cycle cost savings
                                                                     -------------------------------------------
                 TSL                  CEFD2 (lb/kWh)    Efficiency                          Percent of consumers
                                                           level       Average LCC savings  that experience  net
                                                                            * (2020$)             cost (%)
----------------------------------------------------------------------------------------------------------------
1, 3................................            2.02               1                 $25.2                  32.7
2...................................            2.49               2                  23.5                  50.2
4...................................            1.66        Baseline  ....................  ....................
5...................................            2.89               3                  29.4                  51.9
6...................................            3.17               4                (38.8)                  78.8
----------------------------------------------------------------------------------------------------------------
* The savings represent the average LCC for affected consumers. Negative values denoted in parentheses.


                                              Table V.12--Average LCC and PBP Results for Ventless Electric Standard (240V) Consumer Clothes Dryers
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                       Average costs (2020$)
                                                CEFD2 (lb/kWh)                                   ---------------------------------------------------------------- Simple payback      Average
                      TSL                                               Efficiency level                           First year's      Lifetime                         (years)        lifetime
                                                                                                  Installed cost  operating cost  operating cost        LCC                           (years)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          2.03  Baseline........................          $1,020           $53.8            $567          $1,588  ..............            14.0
1.............................................            2.03  Baseline........................           1,020            53.8             567           1,588  ..............            14.0
2, 3, 4, 5....................................            2.68  1...............................           1,025            38.8             412           1,438             0.3            14.0
6.............................................            6.80  2...............................           1,319            11.7             123           1,442             7.1            14.0
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative to the baseline product.


   Table V.13--Average LCC Savings Relative to the No-New-Standards Case for Ventless Electric Standard (240V)
                                             Consumer Clothes Dryers
----------------------------------------------------------------------------------------------------------------
                                                                                Life-cycle cost savings
                                                                     -------------------------------------------
                 TSL                  CEFD2 (lb/kWh)    Efficiency                          Percent of consumers
                                                           level       Average LCC savings   that experience net
                                                                            * (2020$)             cost (%)
----------------------------------------------------------------------------------------------------------------
1...................................            2.03        Baseline  ....................  ....................
2, 3, 4, 5..........................            2.68               1                  $145                   0.0
6...................................            6.80               2                  11.0                  66.4
----------------------------------------------------------------------------------------------------------------
* The savings represent the average LCC for affected consumers.


[[Page 51783]]


                                         Table V.14--Average LCC and PBP Results for Ventless Electric Combination Washer-Dryer Consumer Clothes Dryers
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                       Average costs (2020$)
                                                CEFD2 (lb/kWh)                                   ---------------------------------------------------------------- Simple payback      Average
                      TSL                                               Efficiency level                           First year's      Lifetime                         (years)        lifetime
                                                                                                  Installed cost  operating cost  operating cost        LCC                           (years)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          2.27  Baseline........................          $1,342           $48.3            $513          $1,855  ..............            14.0
1.............................................            2.27  Baseline........................           1,342            48.3             513           1,855  ..............            14.0
2, 3, 4, 5....................................            2.33  1...............................           1,342            46.9             498           1,840             0.0            14.0
6.............................................            4.01  2...............................           1,965            25.7             272           2,237            27.5            14.0
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative to the baseline product.


 Table V.15--Average LCC Savings Relative to the No-New-Standards Case for Ventless Electric Combination Washer-
                                          Dryer Consumer Clothes Dryers
----------------------------------------------------------------------------------------------------------------
                                                                                Life-cycle cost savings
                                                                     -------------------------------------------
                 TSL                  CEFD2 (lb/kWh)    Efficiency                          Percent of consumers
                                                           level       Average LCC savings   that experience net
                                                                            * (2020$)             cost (%)
----------------------------------------------------------------------------------------------------------------
1...................................            2.27        Baseline  ....................  ....................
2, 3, 4, 5..........................            2.33               1                  15.1                   0.0
6...................................            4.01               2                 (387)                  89.8
----------------------------------------------------------------------------------------------------------------
* The savings represent the average LCC for affected consumers. Negative values denoted in parentheses.

b. Consumer Subgroup Analysis
    In the consumer subgroup analysis, DOE estimated the impact of the 
considered TSLs on low-income households and senior-only households for 
product classes with a sufficient sample size in RECS to perform a 
Monte Carlo analysis. DOE was unable to conduct a consumer subgroup 
analysis for product class--vented gas compact for either low-income 
households or senior-only households due to insufficient sample size 
and therefore does not report results for that product class. Table 
V.16 through Table V.27 compare the average LCC savings, PBP, percent 
of consumers negatively impacted, and percent of consumers positively 
impacted at each efficiency level for the consumer subgroups, along 
with corresponding values for the entire residential consumer sample 
for product classes with a sufficient sample size. In most cases, the 
values for low-income households and senior-only households at the 
considered efficiency levels are not substantially different from the 
average for all households. Chapter 11 of the NOPR TSD presents the 
complete LCC and PBP results for the subgroups.

           Table V.16--Comparison of LCC Savings and PBP for Consumer Subgroups and All Households: Electric Standard Consumer Clothes Dryers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Average life-cycle cost savings * (2020$)             Simple payback period (years)
                                                         -----------------------------------------------------------------------------------------------
                   EL                           TSL         Low-income      Senior-only                     Low-income      Senior-only
                                                            households      households    All households    households      households    All households
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.......................................               1            $246            $172            $252             0.6             1.0             0.7
3.......................................               2             430             302             439             0.5             0.8             0.6
4.......................................               3             566             398             578             0.4             0.8             0.6
5.......................................               4             196             101             182             1.4             2.4             1.7
7.......................................            5, 6             306            57.7             230             3.2             5.5            4.00
--------------------------------------------------------------------------------------------------------------------------------------------------------
* The savings represent the average LCC for affected consumers.


  Table V.17--Comparison of Percent of Impacted Consumers * for Consumer Subgroups and All Households: Electric
                                        Standard Consumer Clothes Dryers
----------------------------------------------------------------------------------------------------------------
                                                                    Low-income      Senior-only   All households
                       EL                               TSL       households (%)  households (%)        (%)
----------------------------------------------------------------------------------------------------------------
1...............................................               1            0.27            0.45            0.32
3...............................................               2            0.17            0.25            0.16
4...............................................               3            0.15            0.22            0.11
5...............................................               4            43.7            60.0            53.5
7...............................................            5, 6            42.7            65.2            53.1
----------------------------------------------------------------------------------------------------------------
* Percent of impacted consumers indicates households with net cost.


[[Page 51784]]


        Table V.18--Comparison of LCC Savings and PBP for Consumer Subgroups and All Households: Electric Compact (120V) Consumer Clothes Dryers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Average life-cycle cost savings * (2020$)             Simple payback period (years)
                                                         -----------------------------------------------------------------------------------------------
                   EL                           TSL         Low-income      Senior-only                     Low-income      Senior-only
                                                            households      households    All households    households      households    All households
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.......................................               1            $139           $86.8            $115             1.1             2.1            1. 7
3.......................................               2             232             147             194             1.0             1.9             1.5
4.......................................            3, 4             195             119             160             1.2             2.3             1.8
5.......................................               5             151            41.9            86.3             3.6             6.6             5.3
6.......................................               6            77.4           (123)          (62.6)             7.6            13.8            11.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
* The savings represent the average LCC for affected consumers. Negative values denoted in parentheses.


  Table V.19--Comparison of Percent of Impacted Consumers * for Consumer Subgroups and All Households: Electric
                                     Compact (120V) Consumer Clothes Dryers
----------------------------------------------------------------------------------------------------------------
                                                                    Low-income      Senior-only   All households
                       EL                               TSL       households (%)  households (%)        (%)
----------------------------------------------------------------------------------------------------------------
1...............................................               1            2.43            7.56            5.66
3...............................................               2            1.92            6.15            4.46
4...............................................            3, 4            14.3            24.6            21.6
5...............................................               5            35.5            59.4            53.0
6...............................................               6            53.0            81.5            76.3
----------------------------------------------------------------------------------------------------------------
* Percent of impacted consumers indicates households with net cost.


     Table V.20--Comparison of LCC Savings and PBP for Consumer Subgroups and All Households: Vented Electric Compact (240V) Consumer Clothes Dryers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Average life-cycle cost savings * (2020$)             Simple payback period (years)
                                                         -----------------------------------------------------------------------------------------------
                   EL                           TSL         Low-income      Senior-only                     Low-income      Senior-only
                                                            households      households    All households    households      households    All households
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.......................................               1            $116           $70.0           $94.1             1.4             2.6             2.0
3.......................................               2             241             153             201             1.0             1.9             1.5
4.......................................            3, 4             232             145             192             1.1             2.0             1.6
5.......................................               5             193            70.8             123             3.2             5.9             4.7
6.......................................               6            41.2           (148)          (94.8)             8.3            15.3            12.1
--------------------------------------------------------------------------------------------------------------------------------------------------------
* The savings represent the average LCC for affected consumers. Negative values denoted in parentheses.


   Table V.21--Comparison of Percent of Impacted Consumers * for Consumer Subgroups and All Households: Vented
                                 Electric Compact (240V) Consumer Clothes Dryers
----------------------------------------------------------------------------------------------------------------
                                                                    Low-income      Senior-only   All households
                       EL                               TSL       households (%)  households (%)        (%)
----------------------------------------------------------------------------------------------------------------
1...............................................               1            3.71            11.2            8.63
3...............................................               2            1.89            5.96            4.35
4...............................................            3, 4            3.79            11.7            8.37
5...............................................               5            29.0            53.2            47.0
6...............................................               6            57.0            84.5            79.6
----------------------------------------------------------------------------------------------------------------
* Percent of impacted consumers indicates households with net cost.


          Table V.22--Comparison of LCC Savings and PBP for Consumer Subgroups and All Households: Vented Gas Standard Consumer Clothes Dryers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Average life-cycle cost savings * (2020$)             Simple payback period (years)
                                                         -----------------------------------------------------------------------------------------------
                   EL                           TSL         Low-income      Senior-only                     Low-income      Senior-only
                                                            households      households    All households    households      households    All households
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.......................................               1           $85.1           $52.5           $77.7             2.2             3.6             2.8
2.......................................               2            $182             122             174             1.3             2.1             1.6
3.......................................         3, 4, 5             209             137             198             1.5             2.6             1.9
4.......................................               6            66.5            6.97            43.0             4.4             7.3             5.5
--------------------------------------------------------------------------------------------------------------------------------------------------------
* The savings represent the average LCC for affected consumers.


[[Page 51785]]


 Table V.23--Comparison of Percent of Impacted Consumers * for Consumer Subgroups and All Households: Vented Gas
                                        Standard Consumer Clothes Dryers
----------------------------------------------------------------------------------------------------------------
                                                                    Low-income      Senior-only   All households
                       EL                               TSL       households (%)  households (%)        (%)
----------------------------------------------------------------------------------------------------------------
1...............................................               1            3.97            9.45            6.04
2...............................................               2            0.94            2.70            1.66
3...............................................         3, 4, 5            2.16            5.71            3.74
4...............................................               6            52.2            67.7            59.3
----------------------------------------------------------------------------------------------------------------
* Percent of impacted consumers indicates households with net cost.


   Table V.24--Comparison of LCC Savings and PBP for Consumer Subgroups and All Households: Ventless Electric Standard (240V) Consumer Clothes Dryers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Average life-cycle cost savings * (2020$)             Simple payback period (years)
                                                         -----------------------------------------------------------------------------------------------
                   EL                           TSL         Low-income      Senior-only                     Low-income      Senior-only
                                                            households      households    All households    households      households    All households
--------------------------------------------------------------------------------------------------------------------------------------------------------
0.......................................               1  ..............  ..............  ..............  ..............  ..............  ..............
1.......................................      2, 3, 4, 5            $174            $116            $145             0.2             0.4             0.3
2.......................................               6             136          (53.1)            11.0             4.9             8.9             7.1
--------------------------------------------------------------------------------------------------------------------------------------------------------
* The savings represent the average LCC for affected consumers. Negative values denoted in parentheses.


  Table V.25--Comparison of Percent of Impacted Consumers * for Consumer Subgroups and All Households: Ventless
                                Electric Standard (240V) Consumer Clothes Dryers
----------------------------------------------------------------------------------------------------------------
                                                                    Low-income      Senior-only   All households
                       EL                               TSL       households (%)  households (%)        (%)
----------------------------------------------------------------------------------------------------------------
0...............................................               1  ..............  ..............  ..............
1...............................................      2, 3, 4, 5             0.0            0.01             0.0
2...............................................               6            43.3            72.5            66.4
----------------------------------------------------------------------------------------------------------------
* Percent of impacted consumers indicates households with net cost.


  Table V.26--Comparison of LCC Savings and PBP for Consumer Subgroups and All Households: Ventless Electric Combination Washer-Dryer Consumer Clothes
                                                                         Dryers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Average life-cycle cost savings * (2020$)             Simple payback period (years)
                                                         -----------------------------------------------------------------------------------------------
                   EL                           TSL         Low-income      Senior-only                     Low-income      Senior-only
                                                            households      households    All households    households      households    All households
--------------------------------------------------------------------------------------------------------------------------------------------------------
0.......................................               1  ..............  ..............  ..............  ..............  ..............  ..............
1.......................................      2, 3, 4, 5           $17.2           $12.0           $15.1             0.0             0.0             0.0
2.......................................               6           (174)           (435)           (387)            18.8            34.9            27.5
--------------------------------------------------------------------------------------------------------------------------------------------------------
* The savings represent the average LCC for affected consumers. Negative values denoted in parentheses.


  Table V.27--Comparison of Percent of Impacted Consumers * for Consumer Subgroups and All Households: Ventless
                            Electric Combination Washer-Dryer Consumer Clothes Dryers
----------------------------------------------------------------------------------------------------------------
                                                                    Low-income      Senior-only   All households
                       EL                               TSL       households (%)  households (%)        (%)
----------------------------------------------------------------------------------------------------------------
0...............................................               1  ..............  ..............  ..............
1...............................................      2, 3, 4, 5             0.0             0.0             0.0
2...............................................               6            71.5            92.8            89.8
----------------------------------------------------------------------------------------------------------------
* Percent of impacted consumers indicates households with net cost.

c. Rebuttable Presumption Payback
    As discussed in section II.A of this document, EPCA establishes a 
rebuttable presumption that an energy conservation standard is 
economically justified if the increased purchase cost for a product 
that meets the standard is less than three times the value of the 
first-year energy savings resulting from the standard. (42 U.S.C. 
6295(o)(2)(B)(iii)) In calculating a rebuttable presumption payback 
period for each of the considered TSLs, DOE used discrete values, and, 
as required by EPCA, based the energy use calculation on the DOE test 
procedure for consumer clothes dryers. In contrast, the PBPs presented 
in section V.B.1.a of this document were calculated using distributions 
that reflect the range of energy use in the field.

[[Page 51786]]

    Table V.28 presents the rebuttable-presumption payback periods for 
the considered TSLs for consumer clothes dryers. The results show that 
the estimated rebuttable payback period ranges broadly between the 
product classes. While DOE examined the rebuttable-presumption 
criterion, it considered whether the standard levels considered for the 
NOPR are economically justified through a more detailed analysis of the 
economic impacts of those levels, pursuant to 42 U.S.C. 
6295(o)(2)(B)(i), that considers the full range of impacts to the 
consumer, manufacturer, Nation, and environment. The results of that 
analysis serve as the basis for DOE to definitively evaluate the 
economic justification for a potential standard level, thereby 
supporting or rebutting the results of any preliminary determination of 
economic justification.

                                                   Table V.28--Rebuttable-Presumption Payback Periods
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                               Trial standard level
                      Product class                      -----------------------------------------------------------------------------------------------
                                                                 1               2               3               4               5               6
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                      (Years)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Electric Standard.......................................            0.67            0.56            0.52            1.62            3.75            3.75
Electric Compact (120 V)................................            1.78            1.59            1.93            1.93            5.64            11.7
Vented Electric Compact (240 V).........................            2.18            1.57            1.72            1.72            4.93            12.7
Vented Gas Standard.....................................            4.28            2.80            3.26            3.26            3.26            8.29
Vented Gas Compact......................................            8.48            6.15            8.48  ..............            7.35            20.5
Ventless Electric Compact (240 V).......................  ..............            0.35            0.35            0.35            0.35            7.52
Ventless Electric Combination Washer-Dryer..............  ..............            0.00            0.00            0.00            0.00            28.3
--------------------------------------------------------------------------------------------------------------------------------------------------------

2. Economic Impacts on Manufacturers
    DOE performed an MIA to estimate the impact of amended energy 
conservation standards on manufacturers of consumer clothes dryers. The 
following section describes the expected impacts on manufacturers at 
each considered TSL. Chapter 12 of the NOPR TSD explains the analysis 
in further detail.
a. Industry Cash Flow Analysis Results
    In this section, DOE provides GRIM results from the analysis, which 
examines changes in the industry that would result from a standard. 
Table V.29 illustrates the estimated financial impacts (represented by 
changes in INPV) of potential amended energy conservation standards on 
manufacturers of consumer clothes dryers, as well as the conversion 
costs that DOE estimates manufacturers of consumer clothes dryers would 
incur at each TSL.
    The impact of potential amended energy conservation standards were 
analyzed under two scenarios: (1) the preservation of gross margin 
percentage; and (2) the preservation of operating profit, as discussed 
in section IV.J.2.d of this document. In the preservation of gross 
margin percentage scenario, DOE applied a gross margin percentage of 21 
percent for all product classes and all efficiency levels in the 
standards case. This scenario assumes that a manufacturer's per-unit 
dollar profit would increase as MPCs increase in the standards cases. 
DOE understand this scenario to be an upper bound to industry 
profitability under an energy conservation standard.
    In the preservation of operating profit scenario manufacturers do 
not earn additional operating profit when compared to the no-standards 
case scenario. While manufacturers make the necessary upfront 
investments required to produce compliant products, per-unit operating 
profit does not change in absolute dollars. The preservation of 
operating profit scenario results in the lower (or more severe) bound 
to impacts of potential amended standards on industry.
    Each of the modeled scenarios results in a unique set of cash flows 
and corresponding INPV for each TSL. INPV is the sum of the discounted 
cash flows to the industry from the base year through the end of the 
analysis period (2022-2056). The ``change in INPV'' results refer to 
the difference in industry value between the no-new-standards case and 
standards case at each TSL. To provide perspective on the short-run 
cash flow impact, DOE includes a comparison of free cash flow between 
the no-new-standards case and the standards case at each TSL in the 
year before amended standards would take effect. This figure provides 
an understanding of the magnitude of the required conversion costs 
relative to the cash flow generated by the industry in the no-new-
standards case.
    Conversion costs are one-time investments for manufacturers to 
bring their manufacturing facilities and product designs into 
compliance with potential amended standards. As described in section 
IV.J.2.c of this document, conversion cost investments occur between 
the year of publication of the final rule and the year by which 
manufacturers must comply with the new standard. The conversion costs 
can have a significant impact on the short-term cash flow on the 
industry and generally result in lower free cash flow in the period 
between the publication of the final rule and the compliance date of 
potential amended standards. Conversion costs are independent of the 
manufacturer markup scenarios and are not presented as a range in this 
analysis.

                                                          Table V.29--Manufacturer Impact Analysis Results for Consumer Clothes Dryers
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           No-new-
                                         Units         standards case         TSL 1                TSL 2                TSL 3                TSL 4               TSL 5               TSL 6
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
INPV............................  2020$ millions.....         1,810.1  1,785.0 to 1,798.5.  1,766.8 to 1,789.8.  1,694.5 to 1,728.5.  1,368.8 to 1,582.5  830.1 to 1,675.5..  732.4 to 1,632.0.
Change in INPV *................  %..................  ..............  (1.4) to (0.6).....  (2.4) to (1.1).....  (6.4) to (4.5).....  (24.4) to (12.6)..  (54.1) to (7.4)...  (59.5) to (9.8).
Free Cash Flow (2026) *.........  2020$ millions.....           120.5  107.2..............  98.8...............  57.7...............  (124.1)...........  (392.3)...........  (443.3).

[[Page 51787]]

 
Change in Free Cash Flow (2026)   %..................  ..............  (11.0).............  (18.0).............  (52.1).............  (203.0)...........  (425.7)...........  (468.0).
 *.
Conversion Costs................  2020$ millions.....  ..............  34.1...............  55.3...............  149.7..............  561.7.............  1,164.2...........  1,280.0.
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
* Parentheses denote negative values.

    The cash flow results discussion below refers to product classes as 
defined in Table IV.2 in section IV.A.1 of this proposed rule. It also 
refers to the efficiency levels (``ELs'') and associated design options 
designated in the Table IV.16 through Table IV.21 in section IV.C.1.b 
of this document.
    At TSL 1, the standard reflects efficiency levels with electronic 
controls for all product classes. The change in INPV is expected to 
range from -1.4 to -0.6 percent. At this level, free cash flow is 
estimated to decrease by 11.0 percent compared to the no-new-standards 
case value of $120.5 million in the year 2026, the year before the 
standards year. DOE's shipments analysis estimates approximately 61 
percent of current shipments meet this level.
    The design options DOE analyzed for Product Classes 1 through 5 
include implementing electronic controls. For Product Classes 1 through 
5, TSL 1 corresponds to EL 1. For Product Classes 6 and 7, TSL 1 
corresponds to the baseline CEFD2. Capital conversion costs 
may be necessary for additional tooling for timers and electronics. 
Product conversion costs may be necessary for developing, sourcing, and 
testing electronics (e.g., safety, performance, and durability tests). 
DOE does not expect industry to incur re-flooring costs at this level 
since the necessary enhancements could be done ``behind the hinge,'' 
incorporating the design changes in a manner that does not impact 
product appearance. DOE does not expect industry to incur conversion 
costs related to Product Classes 6 and 7, as the efficiency levels 
would remain at baseline. DOE estimates capital conversion costs of 
$15.7 million and product conversion of costs of $18.4 million. 
Conversion costs total $34.1 million.
    At TSL 1, the shipment-weighted average MPC for all consumer 
clothes dryers is expected to increase by 1 percent relative to the no-
new-standards case shipment-weighted average MPC for all consumer 
clothes dryers in 2027. Given this relatively small increase in 
production costs, DOE does not project a notable drop in shipments in 
the year the standard takes effect. In the preservation of gross margin 
percentage scenario, the slight increase in MSP is outweighed by the 
$34.1 million in conversion costs, causing a slightly negative change 
in INPV at TSL 1 under this scenario. Under the preservation of 
operating profit scenario, manufacturers earn the same per-unit 
operating profit as would be earned in the no-new-standards case, but 
manufacturers do not earn additional profit from their investments. In 
this scenario, the manufacturer markup decreases in 2028, the year 
after the analyzed compliance year. This reduction in the manufacturer 
markup and the $34.1 million in conversion costs incurred by 
manufacturers cause a slightly negative change in INPV at TSL 1 under 
the preservation of operating profit scenario.
    At TSL 2, the standard reflects efficiency levels with more 
advanced automatic termination controls for Product Classes 1 through 
6, and high-speed spin for product class 7. The change in INPV is 
expected to range from -2.4 to -1.1 percent. At this level, free cash 
flow is estimated to decrease 18.0 percent compared to the no-new-
standards case value of $120.5 million in the year 2026, the year 
before the standards year. DOE's shipments analysis estimates 
approximately 60 percent of current shipments meet this level.
    The design options for Product Classes 1 through 6 include 
implementing electronic controls, optimized heating systems, and more 
advanced automatic termination controls. For Product Class 7, the 
design option analyzed includes high-speed spin cycles. For Product 
Classes 1 through 3, TSL 2 corresponds to EL 3. For Product Classes 4 
and 5, TSL 2 corresponds to EL 2. For Product Classes 6 and 7, TSL 2 
corresponds to EL 1. Capital conversion costs may be necessary for 
incremental updates in tooling. Product conversion costs may be 
necessary for software optimization, prototyping, and testing. DOE 
expects industry to incur some re-flooring costs as manufacturers 
redesign product lines to meet the efficiency levels required by TSL 2. 
DOE estimates capital conversion costs of $26.9 million and product 
conversion of costs of $28.4 million. Conversion costs total $55.3 
million.
    At TSL 2, the shipment-weighted average MPC for all consumer 
clothes dryers is expected to increase by 2 percent relative to the no-
new-standards case shipment-weighted average MPC for all consumer 
clothes dryers in 2027. Given the relatively small increase in 
production costs, DOE does not project a notable drop in shipments in 
the year the standard takes effect. In the preservation of gross margin 
percentage scenario, the slight increase in MSP is outweighed by the 
$55.3 million in conversion costs, causing a slightly negative change 
in INPV at TSL 2 under this scenario. Under the preservation of 
operating profit scenario, the manufacturer markup decreases in 2028, 
the year after the analyzed compliance year. This reduction in the 
manufacturer markup and the $55.3 million in conversion costs incurred 
by manufacturers cause a negative change in INPV at TSL 2 under the 
preservation of operating profit scenario.
    At TSL 3, the standard reflects a set of efficiency levels between 
the levels designated in TSL 2 and TSL 4 and corresponds to the current 
ENERGY STAR efficiency level for vented electric standard dryers, which 
represent over 80 percent of the market. The change in INPV is expected 
to range from -6.4 to -4.5 percent. At this level, free cash flow is 
estimated to decrease 52.1 percent compared to the no-new-standards 
case value of $120.5 million in the year 2026, the year before the 
standards year. DOE's shipments analysis estimates approximately 59 
percent of current shipments meet this level.
    The design options analyzed for Product Classes 1 through 4 include 
implementing electronic controls, optimized heating systems, more 
advanced automatic termination controls, and modulating heat. The 
design option for Product Class 5 includes implementing electronic 
controls. For Product Classes 6 and 7, the design options analyzed are 
the same as with TSL 2. For Product Classes

[[Page 51788]]

1 through 3, TSL 3 corresponds to EL 4. For Product Class 4, TSL 3 
corresponds to EL 3. For Product Classes 5 through 7, TSL 3 corresponds 
to EL 1. The incremental increase in industry conversion costs from the 
prior TSL are due to the higher efficiency level requirements for 
Product Classes 1 through 4. Capital conversion costs may be necessary 
as manufacturers increase tooling for two-stage heating systems. 
Product conversion costs may be necessary for prototyping and testing. 
DOE expects industry to incur similar re-flooring costs as with TSL 2. 
DOE estimates capital conversion costs of $108.8 million and product 
conversion of costs of $40.9 million. Conversion costs total $149.7 
million.
    At TSL 3, the shipment-weighted average MPC for all consumer 
clothes dryers is expected to increase by 3 percent relative to the no-
new-standards case shipment-weighted average MPC for all consumer 
clothes dryers in 2027. Given the relatively small increase in 
production costs, DOE does not project a notable drop in shipments in 
the year the standard takes effect. In the preservation of gross margin 
percentage scenario, the increase in MSP is outweighed by the $149.7 
million in conversion costs, causing a negative change in INPV at TSL 3 
under this scenario. Under the preservation of operating profit 
scenario, the manufacturer markup decreases in 2028, the year after the 
analyzed compliance year. This reduction in the manufacturer markup and 
the $149.7 million in conversion costs incurred by manufacturers cause 
a negative change in INPV at TSL 3 under the preservation of operating 
profit scenario.
    At TSL 4, the standard reflects the maximum national energy savings 
with simple PBP of less than 4 years. The change in INPV is expected to 
range from -24.4 to -12.6 percent. At this level, free cash flow is 
estimated to decrease by 203.0 percent compared to the no-new-standards 
case value of $120.5 million in the year 2026, the year before the 
standards year. DOE's shipments analysis estimates approximately 11 
percent of current shipments meet this level.
    The design options analyzed for Product Class 1 include 
implementing electronic controls, optimized heating systems, more 
advanced automatic termination controls, modulating heat, and inlet air 
preheat. For Product Classes 2 through 7, the efficiency levels 
required for TSL 4 are the same as the efficiency levels required by 
TSL 3, except for Product Class 5, which corresponds to the baseline 
CEFD2. The incremental increase in industry conversion costs 
from the prior TSL are due to the efficiency level requirements for 
Product Class 1. There is very little industry experience with inlet 
air preheat designs. Currently, DOE is not aware of any consumer 
clothes dryers on the market utilizing this design option. Electric 
standard dryers (Product Class 1) account for an estimated 81 percent 
of domestic consumer clothes dryer shipments. Of these standard 
electric dryer shipments, DOE estimates only 4 percent meet or exceed 
the efficiency level required by TSL 4. Implementing inlet air preheat 
represents a major overhaul of existing product lines and manufacturing 
facilities. For capital conversion costs, this change might necessitate 
significant new equipment and tooling. Product conversion costs may be 
necessary for designing, prototyping, and testing new or updated 
platforms. DOE expects industry to incur more re-flooring costs 
compared to prior TSLs as more display units would need to be replaced 
with high-efficiency models. DOE estimates capital conversion costs of 
$489.2 million and product conversion of costs of $72.5 million. 
Conversion costs total $561.7 million.
    At TSL 4, the large conversion costs result in a free cash flow 
dropping below zero in the years before the standards year. The 
negative free cash flow calculation indicates manufacturers may need to 
access cash reserves or outside capital to finance conversion efforts.
    At this level, the shipment-weighted average MPC for all consumer 
clothes dryers is expected to increase by 17 percent relative to the 
no-new-standards case shipment-weighted average MPC for all consumer 
clothes dryers in 2027. Given the projected increase in production 
costs, DOE expects an estimated 1 percent drop in shipments in the year 
the standard takes effect. In the preservation of gross margin 
percentage scenario, the increase in MSP is outweighed by the $561.7 
million in conversion costs, causing a negative change in INPV at TSL 4 
under this scenario. Under the preservation of operating profit 
scenario, the manufacturer markup decreases in 2028, the year after the 
analyzed compliance year. This reduction in the manufacturer markup and 
the $561.7 million in conversion costs incurred by manufacturers cause 
a negative change in INPV at TSL 4 under the preservation of operating 
profit scenario.
    At TSL 5, the standard reflects the maximum national energy savings 
with positive NPV. The change in INPV is expected to range from -54.1 
to -7.4 percent. At this level, free cash flow is estimated to decrease 
by 425.7 percent compared to the no-new-standards case value of $120.5 
million in the year 2026, the year before the standards year. DOE's 
shipments analysis estimates approximately 9 percent of current 
shipments meet this level.
    The design option analyzed for Product Class 1 includes 
implementing heat pump technology. The design options analyzed for 
Product Classes 2 and 3 include implementing electronic controls, 
optimized heating systems, more advanced automatic termination 
controls, modulating heat, and inlet air preheat. For Product Classes 
4, 6, and 7, the design options analyzed are the same as prior TSL. At 
TSL 5, the design option for Product Class 5 includes implementing 
electronic controls, optimized heating systems, more advanced automatic 
termination controls, and modulating heat. For Product Class 1, TSL 5 
corresponds to EL 7. For Product Class 2 and 3, TSL 5 corresponds to EL 
5. For Product Class 4 and 5, TSL 5 corresponds to EL 3. For Product 
Class 6 and 7, TSL 5 corresponds to EL 1.
    At TSL 5, conversion costs are largely driven by the max-tech 
efficiency level required for Product Class 1. As previously discussed, 
electric standard dryers account for 81 percent of domestic consumer 
clothes dryer shipments. Currently, there are few electric standard 
models on the U.S. market that meet the max-tech efficiency level 
required by TSL 5. Of the 15 OEMs identified, seven OEMs do not offer 
any U.S. dryers utilizing heat pump technology. Of the eight OEMs with 
heat pump dryers, only three have electric standard dryers that meet 
max-tech efficiencies. Most manufacturers would need to significantly 
update facilities to meet a heat pump efficiency level for Product 
Class 1. Mandating a heat pump efficiency level for Product Class 1 
would require many manufacturers to design completely new clothes dryer 
platforms or adapt heat pump designs from other markets (i.e., redesign 
European heat pump models to adhere to U.S. safety standards and 
consumer preferences). DOE expects industry to incur more re-flooring 
costs compared to prior TSLs as nearly all display units would need to 
be replaced with high-efficiency models. DOE estimates capital 
conversion costs of $1,066.0 million and product conversion of costs of 
$98.2 million. Conversion costs total $1,164.2 million.
    As with TSL 4, the large conversion costs result in a free cash 
flow dropping below zero in the years before the standard year. The 
negative free cash flow calculation indicates

[[Page 51789]]

manufacturers may need to access cash reserves or outside capital to 
finance conversion efforts.
    At this level, the shipment-weighted average MPC for all consumer 
clothes dryers is expected to increase by 64 percent relative to the 
no-new-standards case shipment-weighted average MPC for all consumer 
clothes dryers in 2027. Given the projected increase in production 
costs, DOE expects an estimated 12 percent drop in shipments in the 
year the standard takes effect. In the preservation of gross margin 
percentage scenario, the increase in MSP is outweighed by the $1,164.2 
million in conversion costs and the drop in annual shipments, causing a 
negative change in INPV at TSL 5 under this scenario. Under the 
preservation of operating profit scenario, the manufacturer markup 
decreases in 2028, the year after the analyzed compliance year. This 
large reduction in manufacturer markup, the $1,164.2 million in 
conversion costs incurred by manufacturers, and the drop in annual 
shipments cause a significantly negative change in INPV at TSL 5 under 
the preservation of operating profit scenario.
    At TSL 6, the standard reflects max-tech efficiency for all product 
classes. The change in INPV is expected to range from -59.5 to -9.8 
percent. At this level, free cash flow is estimated to decrease by 
468.0 percent compared to the no-new-standards case value of $120.5 
million in the year 2026, the year before the standards year. DOE's 
shipments analysis estimates approximately 1 percent of current 
shipments meet this level.
    The design option analyzed for TSL 6 incorporates heat pump 
technology for Product Classes 1, 2, 3, 6, and 7. For Product Classes 4 
and 5, the design options analyzed include implementing electronic 
controls, optimized heating systems, more advanced automatic 
termination controls, modulating heat, and inlet air preheat. Seven out 
of 15 manufacturers identified do not offer any models for the domestic 
market that utilize heat pump technology. Of the eight OEMs that offer 
domestic heat pump models, only four of them offer an electric dryer at 
or above the efficiencies required by TSL 6. A standard that could only 
be met using heat pump technology could require a total renovation of 
existing facilities and completely new clothes dryer platforms for 
manufacturers that do not offer heat pump clothes dryers today. In 
interviews, two OEMs with significant market shares stated that they 
would require additional facilities to handle dryer manufacturing under 
a standard that could only be met using heat pump technology. As 
previously discussed, implementing inlet air preheat also represents a 
major overhaul of existing vented gas product lines. DOE expects 
industry to incur slightly more re-flooring costs compared to TSL 5 as 
all display models below max-tech efficiency would need to be replaced 
due to the higher standard. At TSL 6, reaching max-tech efficiency 
levels is a billion-dollar investment for industry. DOE estimates 
capital conversion costs of $1,172.0 million and product conversion of 
costs of $108.0 million. Conversion costs total $1,280.0 million.
    As with TSLs 4 and 5, the large conversion costs result in a free 
cash flow dropping below zero in the years before the standard year. 
The negative free cash flow calculation indicates manufacturers may 
need to access cash reserves or outside capital to finance conversion 
efforts.
    At this level, the shipment-weighted average MPC for all consumer 
clothes dryers is expected to increase by 69 percent relative to the 
no-new-standards case shipment-weighted average MPC for all consumer 
clothes dryers in 2027. Given the projected increase in production 
costs, DOE expects an estimated 13 percent drop in shipments in the 
year the standard takes effect. In the preservation of gross margin 
percentage scenario, the large increase in MSP is still outweighed by 
the $1,280.0 million in conversion costs and drop in annual shipments, 
causing a moderately negative change in INPV at TSL 6 under this 
scenario. Under the preservation of operating profit scenario, the 
manufacturer markup decreases in 2028, the year after the analyzed 
compliance year. This large reduction in manufacturer markup, the 
$1,280.0 million in conversion costs incurred by manufacturers, and the 
drop in annual shipments cause a significantly negative change in INPV 
at TSL 6 under the preservation of operating profit scenario.
b. Direct Impacts on Employment
    To quantitatively assess the potential impacts of amended energy 
conservation standards on direct employment in the consumer clothes 
dryer industry, DOE used the GRIM to estimate the domestic labor 
expenditures and number of direct employees in the no-new-standards 
case and in each of the standards cases during the analysis period. DOE 
calculated these values using statistical data from the U.S. Census 
Bureau's 2020 Annual Survey of Manufactures (``ASM''),\81\ the U.S. 
Bureau of Labor Statistics' employee compensation data,\82\ results of 
the engineering analysis, and manufacturer interviews.
---------------------------------------------------------------------------

    \81\ U.S. Census Bureau, Annual Survey of Manufacturers: Summary 
Statistics for Industry Groups and Industries in the U.S.: 2018-
2020. Available at www.census.gov/data/tables/time-series/econ/asm/2018-2020-asm.html (Last Accessed December 10, 2021).
    \82\ U.S. Bureau of Labor Statistics. Employer Costs for 
Employee Compensation. June 17, 2021. Available at: www.bls.gov/news.release/pdf/ecec.pdf.
---------------------------------------------------------------------------

    Labor expenditures related to product manufacturing depend on the 
labor intensity of the product, the sales volume, and an assumption 
that wages remain fixed in real terms over time. The total labor 
expenditures in each year are calculated by multiplying the total MPCs 
by the labor percentage of MPCs. The total labor expenditures in the 
GRIM were then converted to total production employment levels by 
dividing production labor expenditures by the average fully burdened 
wage multiplied by the average number of hours worked per year per 
production worker. To do this, DOE relied on the ASM inputs: Production 
Workers Annual Wages, Production Workers Annual Hours, Production 
Workers for Pay Period, and Number of Employees. DOE also relied on the 
BLS employee compensation data to determine the fully burdened wage 
ratio. The fully burdened wage ratio factors in paid leave, 
supplemental pay, insurance, retirement and savings, and legally 
required benefits.
    The number of production employees is then multiplied by the U.S. 
labor percentage to convert total production employment to total 
domestic production employment. The U.S. labor percentage represents 
the industry fraction of domestic manufacturing production capacity for 
the covered product. This value is derived from manufacturer 
interviews, product database analysis, and publicly available 
information. DOE estimates that 58 percent of consumer clothes dryers 
are produced domestically.
    The domestic production employees estimate covers production line 
workers, including line supervisors, who are directly involved in 
fabricating and assembling products within the OEM facility. Workers 
performing services that are closely associated with production 
operations, such as materials handling tasks using forklifts, are also 
included as production labor. DOE's estimates only account for 
production workers who manufacture the specific equipment covered by 
this proposed rulemaking.

[[Page 51790]]

    Non-production workers account for the remainder of the direct 
employment figure. The non-production employees estimate covers 
domestic workers who are not directly involved in the production 
process, such as sales, engineering, human resources, and management. 
Using the amount of domestic production workers calculated above, non-
production domestic employees are extrapolated by multiplying the ratio 
of non-production workers in the industry compared to production 
employees. DOE assumes that this employee distribution ratio remains 
constant between the no-standards case and standards cases.
    Using the GRIM, DOE estimates in the absence of new energy 
conservation standards there would be 2,460 domestic workers for 
consumer clothes dryers in 2027. Table V.30 shows the range of the 
impacts of energy conservation standards on U.S. manufacturing 
employment in the consumer clothes dryer industry. The following 
discussion provides a qualitative evaluation of the range of potential 
impacts presented in Table V.30.

                             Table V.30--Domestic Direct Employment Impacts for Consumer Clothes Dryer Manufacturers in 2027
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                   No-new-
                               standards case        TSL 1             TSL 2             TSL 3             TSL 4             TSL 5            TSL 6
--------------------------------------------------------------------------------------------------------------------------------------------------------
Direct Employment in 2027               2,460  2,468...........  2,489...........  2,495...........  2,809...........  5,101...........  5,209.
 (Production Workers + Non-
 Production Workers).
Potential Changes in Direct    ..............  (2,166) to 8....  (2,166) to 29...  (2,166) to 35...  (2,166) to 349..  (2,166) to 2,641  (2,166) to
 Employment Workers in 2027 *.                                                                                                            2,749.
--------------------------------------------------------------------------------------------------------------------------------------------------------
* DOE presents a range of potential employment impacts. Numbers in parentheses indicate negative numbers.

    The direct employment impacts shown in Table V.30 represent the 
potential domestic employment changes that could result following the 
compliance date for the consumer clothes dryer product classes in this 
proposal. The upper bound estimate corresponds to an increase in the 
number of domestic workers that would result from amended energy 
conservation standards if manufacturers continue to produce the same 
scope of covered equipment within the United States after compliance 
takes effect. The lower bound estimate represents the maximum decrease 
in production workers if manufacturing moved to lower labor-cost 
countries. Most manufacturers currently produce at least a portion of 
their consumer clothes dryers in countries with lower labor costs, and 
an amended standard that necessitates large increases in labor content 
or large expenditures to re-tool facilities could cause manufacturers 
to re-evaluate domestic production siting options.
    Additional detail on the analysis of direct employment can be found 
in chapter 12 of the NOPR TSD. Additionally, the employment impacts 
discussed in this section are independent of the employment impacts 
from the broader U.S. economy, which are documented in chapter 16 of 
the NOPR TSD.
c. Impacts on Manufacturing Capacity
    As discussed in section V.B.2.a of this document, implementing the 
different design options analyzed for this NOPR would require varying 
levels of resources and investment. A standard level that would require 
the use of heat pump technology for electric dryers and combination 
washer-dryers would represent the biggest shift in technology for 
clothes dryer manufacturing among all the design options considered for 
this analysis. Adopting efficiency levels that require heat pump 
technology would necessitate very large investments to both redesign 
products and update production facilities. Currently, DOE estimates 
that approximately 1 percent of consumer clothes dryer shipments meet 
heat pump efficiency levels. In interviews, several manufacturers 
expressed concerns that the 3-year time period between the announcement 
of the final rule and the compliance date of the amended energy 
conservation standard might be insufficient to design, test, and 
manufacture the necessary number of products to meet demand.
    In interviews, some manufacturers raised concerns about 
implementing inlet air preheat designs. Unlike the discussions about 
heat pump technology, there is very little industry experience with 
inlet air preheat designs. Currently, no models on the U.S. market 
incorporate this design option. Several manufacturers speculated that 
implementing inlet air preheat would require a major overhaul of 
existing production facilities and a significant amount of engineering 
time.
    For the remaining dryer design options associated with lower 
efficiency levels (e.g., implementing electronic controls, optimized 
heating systems, more advanced automatic termination controls, and 
modulating heat), manufacturers could likely maintain manufacturing 
capacity levels and continue to meet market demand under amended energy 
conservation standards. A significant portion of consumer clothes 
dryers already incorporate these design options. For instance, 
approximately 64 percent of standard electric dryer shipments meet or 
exceed the efficiencies associated with implementing modulating heat 
(EL 4). However, industry did note concerns about the ongoing supply 
constraints related to the COVID-19 pandemic, particularly around 
sourcing microprocessors and electronics. Any shift away from 
electromechanical controls would require that industry source more 
electronic components, which are already difficult to secure. If these 
supply constraints continue through the end of the conversion period, 
industry could face production capacity constraints.
d. Impacts on Subgroups of Manufacturers
    Using average cost assumptions to develop industry cash-flow 
estimates may not capture the differential impacts among subgroups of 
manufacturers. Small manufacturers, niche players, or manufacturers 
exhibiting a cost structure that differs substantially from the 
industry average could be affected disproportionately. DOE investigated 
small businesses as a manufacturer subgroup that could be 
disproportionally impacted by energy conservation standards and could 
merit additional analysis. DOE did not identify any other adversely 
impacted manufacturer subgroups for this rulemaking based on the 
results of the industry characterization.
    DOE analyzes the impacts on small businesses in a separate analysis 
in section VI.B of this document as part of the Regulatory Flexibility 
Analysis. For a discussion of the impacts on the small business 
manufacturer subgroup, see the Regulatory Flexibility Analysis in

[[Page 51791]]

section VI.B of this document and chapter 12 of the NOPR TSD.
e. Cumulative Regulatory Burden
    One aspect of assessing manufacturer burden involves looking at the 
cumulative impact of multiple DOE standards and the product-specific 
regulatory actions of other Federal agencies that affect the 
manufacturers of a covered product or equipment. While any one 
regulation may not impose a significant burden on manufacturers, the 
combined effects of several existing 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 
appliance efficiency.
    For the cumulative regulatory burden analysis, DOE examines 
Federal, product-specific regulations that could affect consumer 
clothes dryer manufacturers that take effect approximately three years 
before or after the 2027 compliance date.

Table V.31--Compliance Dates and Expected Conversion Expenses of Federal Energy Conservation Standards Affecting
                             Consumer Clothes Dryer Original Equipment Manufacturers
----------------------------------------------------------------------------------------------------------------
                                                                                                     Industry
                                               Number of OEMs                       Industry        conversion
 Federal energy conservation  Number of OEMs    affected from       Approx.     conversion costs   costs/product
          standard                   *         today's rule **  standards year    (millions $)      revenue ***
                                                                                                        (%)
----------------------------------------------------------------------------------------------------------------
Portable Air Conditioners 85              11                 2            2025    $320.9 (2015$)             6.7
 FR 1378 (January 10, 2020).
Room Air Conditioners                      8                 4            2026      22.8 (2020$)             0.5
 [dagger] 87 FR 20608 (April
 7, 2022)...................
Commercial Water Heating                  15                 1            2026      34.6 (2020$)             4.7
 Equipment [dagger] 87 FR
 30610 (May 19, 2022).......
Consumer Furnaces [dagger]                15                 1            2029     150.6 (2020$)             1.4
 87 FR 40590 (July 7, 2022).
----------------------------------------------------------------------------------------------------------------
* This column presents the total number of OEMs identified in the energy conservation standard rule contributing
  to cumulative regulatory burden.
** This column presents the number of OEMs producing consumer clothes dryers that are also listed as OEMs in the
  identified energy conservation standard contributing to cumulative regulatory burden.
*** This column presents industry conversion costs as a percentage of product revenue during the conversion
  period. Industry conversion costs are the upfront investments manufacturers must make to sell compliant
  products/equipment. The revenue used for this calculation is the revenue from just the covered product/
  equipment associated with each row. The conversion period is the time frame over which conversion costs are
  made and lasts from the publication year of the final rule to the compliance year of the final rule. The
  conversion period typically ranges from 3 to 5 years, depending on the energy conservation standard.
[dagger] The Room Air Conditioners, Consumer Furnaces, and Commercial Water Heating Equipment rulemakings are in
  the NOPR stage and all values are subject to change until finalized.

3. National Impact Analysis
    This section presents DOE's estimates of the national energy 
savings and the NPV of consumer benefits that would result from each of 
the TSLs considered as potential amended standards.
a. Significance of Energy Savings
    To estimate the energy savings attributable to potential amended 
standards for consumer clothes dryers, DOE compared their energy 
consumption under the no-new-standards case to their anticipated energy 
consumption under each TSL. The savings are measured over the entire 
lifetime of products purchased in the 30-year period that begins in the 
year of anticipated compliance with amended standards (2027-2056). 
Table V.32 presents DOE's projections of the national energy savings 
for each TSL considered for consumer clothes dryers. The savings were 
calculated using the approach described in section IV.H.2 of this 
document.

                            Table V.32--Cumulative National Energy Savings for Consumer Clothes Dryers; 30 Years of Shipments
                                                                       [2027-2056]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                               Trial standard level
                                                         -----------------------------------------------------------------------------------------------
                                                                 1               2               3               4               5               6
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                      (quads)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Primary energy..........................................            0.97            1.98            2.97            3.90            9.59            9.68
FFC energy..............................................            1.01            2.07            3.11            4.06            9.97            10.1
--------------------------------------------------------------------------------------------------------------------------------------------------------

    OMB Circular A-4 \83\ 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

[[Page 51792]]

using 9 years, 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.\84\ The review timeframe 
established in EPCA is generally not synchronized with the product 
lifetime, product manufacturing cycles, or other factors specific to 
consumer clothes dryers. Thus, such results are presented for 
informational purposes only and are not indicative of any change in 
DOE's analytical methodology. The NES sensitivity analysis results 
based on a 9-year analytical period are presented in Table V.33. The 
impacts are counted over the lifetime of consumer clothes dryers 
purchased in 2027-2035.
---------------------------------------------------------------------------

    \83\ U.S. Office of Management and Budget. Circular A-4: 
Regulatory Analysis. September 17, 2003. Available at 
obamawhitehouse.archives.gov/omb/circulars_a004_a-4/ (last accessed 
December 16, 2021).
    \84\ Section 325(m) of EPCA requires DOE to review its standards 
at least once every 6 years, and requires, for certain products, a 
3-year period after any new standard is promulgated before 
compliance is required, except that in no case may any new standards 
be required within 6 years of the compliance date of the previous 
standards. While adding a 6-year review to the 3-year compliance 
period adds up to 9 years, DOE notes that it may undertake reviews 
at any time within the 6-year period and that the 3-year compliance 
date may yield to the 6-year backstop. A 9-year analysis period may 
not be appropriate given the variability that occurs in the timing 
of standards reviews and the fact that for some products, the 
compliance period is 5 years rather than 3 years.

                            Table V.33--Cumulative National Energy Savings for Consumer Clothes Dryers; 9 Years of Shipments
                                                                       [2027-2035]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                               Trial standard level
                                                         -----------------------------------------------------------------------------------------------
                                                                 1               2               3               4               5               6
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                      (quads)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Primary energy..........................................            0.41            0.78            1.09            1.35            2.92            2.95
FFC energy..............................................            0.43            0.82            1.14            1.41            3.04            3.07
--------------------------------------------------------------------------------------------------------------------------------------------------------

b. Net Present Value of Consumer Costs and Benefits
    DOE estimated the cumulative NPV of the total costs and savings for 
consumers that would result from the TSLs considered for consumer 
clothes dryers. In accordance with OMB's guidelines on regulatory 
analysis,\85\ DOE calculated NPV using both a 7-percent and a 3-percent 
real discount rate. Table V.34 shows the consumer NPV results with 
impacts counted over the lifetime of products purchased in 2027-2056.
---------------------------------------------------------------------------

    \85\ U.S. Office of Management and Budget. Circular A-4: 
Regulatory Analysis. September 17, 2003. Available at 
obamawhitehouse.archives.gov/omb/circulars_a004_a-4/ (last accessed 
December 16, 2021).

                    Table V.34--Cumulative Net Present Value of Consumer Benefits for Consumer Clothes Dryers; 30 Years of Shipments
                                                                       [2027-2056]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                               Trial standard level
                      Discount rate                      -----------------------------------------------------------------------------------------------
                                                                 1               2               3               4               5               6
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                  (billion 2020$)
--------------------------------------------------------------------------------------------------------------------------------------------------------
3 percent...............................................            6.90            14.1            20.8            18.4            27.8            25.7
7 percent...............................................            3.10            6.28            9.07            7.13            7.76            6.60
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The NPV results based on the aforementioned 9-year analytical 
period are presented in Table V.35. The impacts are counted over the 
lifetime of products purchased in 2027-2035. As mentioned previously, 
such results are presented for informational purposes only and are not 
indicative of any change in DOE's analytical methodology or decision 
criteria.

                     Table V.35--Cumulative Net Present Value of Consumer Benefits for Consumer Clothes Dryers; 9 Years of Shipments
                                                                       [2027-2035]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                               Trial standard level
                      Discount rate                      -----------------------------------------------------------------------------------------------
                                                                 1               2               3               4               5               6
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                  (billion 2020$)
--------------------------------------------------------------------------------------------------------------------------------------------------------
3 percent...............................................            3.61            7.02            9.78            8.90            12.8            11.9
7 percent...............................................            1.96            3.84            5.34            4.38            4.91            4.27
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The previous results in Table V.34 reflect the use of a default 
trend to estimate the change in price for consumer clothes dryers over 
the analysis period (see section IV.F.1 of this document). DOE also 
conducted a sensitivity analysis that considered one scenario with a 
lower rate of price decline than the reference case and one

[[Page 51793]]

scenario with a higher rate of price decline than the reference case. 
The results of these alternative cases are presented in appendix 10C of 
the NOPR TSD. In the high-price-decline case, the NPV of consumer 
benefits is higher than in the default case. In the low-price-decline 
case, the NPV of consumer benefits is lower than in the default case.
c. Indirect Impacts on Employment
    It is estimated that that amended energy conservation standards for 
consumer clothes dryers would reduce energy expenditures for consumers 
of those products, with the resulting net savings being redirected to 
other forms of economic activity. These expected shifts in spending and 
economic activity could affect the demand for labor. As described in 
section IV.N of this document, DOE used an input/output model of the 
U.S. economy to estimate indirect employment impacts of the TSLs that 
DOE considered. There are uncertainties involved in projecting 
employment impacts, especially changes in the later years of the 
analysis. Therefore, DOE generated results for near-term timeframes 
(2027-2033), where these uncertainties are reduced.
    The results suggest that the proposed standards would be likely to 
have a negligible impact on the net demand for labor in the economy. 
The net change in jobs is so small that it would be imperceptible in 
national labor statistics and might be offset by other, unanticipated 
effects on employment. Chapter 16 of the NOPR TSD presents detailed 
results regarding anticipated indirect employment impacts.
4. Impact on Utility or Performance of Products
    As discussed in section III.E.1.d of this document, DOE has 
tentatively concluded that the standards proposed in this NOPR would 
not lessen the utility or performance of the consumer clothes dryers 
under consideration in this rulemaking. Manufacturers of these products 
currently offer units that meet or exceed the proposed standards.
5. Impact of Any Lessening of Competition
    DOE considered any lessening of competition that would be likely to 
result from new or amended standards. As discussed in section III.E.1.e 
of this document, the Attorney General determines the impact, if any, 
of any lessening of competition likely to result from a proposed 
standard, and transmits such determination in writing to the Secretary, 
together with an analysis of the nature and extent of such impact. To 
assist the Attorney General in making this determination, DOE has 
provided DOJ with copies of this NOPR and the accompanying TSD for 
review. DOE will consider DOJ's comments on the proposed rule in 
determining whether to proceed to a final rule. DOE will publish and 
respond to DOJ's comments in that document. DOE invites comment from 
the public regarding the competitive impacts that are likely to result 
from this proposed rule. In addition, stakeholders may also provide 
comments separately to DOJ regarding these potential impacts. See the 
ADDRESSES section for information to send comments to DOJ.
6. Need of the Nation To Conserve Energy
    Enhanced energy efficiency, where economically justified, improves 
the Nation's energy security, strengthens the economy, and reduces the 
environmental impacts (costs) of energy production. Reduced electricity 
demand due to energy conservation standards is also likely to reduce 
the cost of maintaining the reliability of the electricity system, 
particularly during peak-load periods. Chapter 15 in the NOPR TSD 
presents the estimated impacts on electricity generating capacity, 
relative to the no-new-standards case, for the TSLs that DOE considered 
in this rulemaking.
    Energy conservation resulting from potential energy conservation 
standards for consumer clothes dryers is expected to yield 
environmental benefits in the form of reduced emissions of certain air 
pollutants and greenhouse gases. Table V.36 provides DOE's estimate of 
cumulative emissions reductions expected to result from the TSLs 
considered in this proposed rulemaking. The emissions were calculated 
using the multipliers discussed in section IV.K of this document. DOE 
reports annual emissions reductions for each TSL in chapter 13 of the 
NOPR TSD.

                               Table V.36--Cumulative Emissions Reduction for Consumer Clothes Dryers Shipped in 2027-2056
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                               Trial standard level
                                                         -----------------------------------------------------------------------------------------------
                                                                 1               2               3               4               5               6
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 Power Sector Emissions
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO2 (million metric tons)...............................            35.1            71.5             107             138             329             334
SO2 (thousand tons).....................................            13.7            27.9            42.1            56.5             145             145
NOX (thousand tons).....................................            17.2            35.1            52.1            65.0             144             149
Hg (tons)...............................................            0.08            0.17            0.25            0.34            0.88            0.88
CH4 (thousand tons).....................................            2.48            5.05            7.58            10.0            25.2            25.3
N2O (thousand tons).....................................            0.34            0.70            1.05            1.39            3.51            3.52
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Upstream Emissions
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO2 (million metric tons)...............................            2.82            5.77            8.60            10.9            25.0            25.6
SO2 (thousand tons).....................................            0.16            0.33            0.49            0.66            1.67            1.67
NOX (thousand tons).....................................            42.1            86.3             129             163             372             382
Hg (tons)...............................................           0.000           0.001           0.001           0.001           0.003           0.003
CH4 (thousand tons).....................................             287             587             875           1,101           2,494           2,567
N2O (thousand tons).....................................            0.01            0.03            0.04            0.05            0.12            0.12
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Total FFC Emissions
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO2 (million metric tons)...............................            37.9            77.3             116             149             354             360
SO2 (thousand tons).....................................            13.9            28.3            42.6            57.2             147             147
NOX (thousand tons).....................................            59.4             121             181             228             516             531
Hg (tons)...............................................            0.08            0.17            0.26            0.34            0.88            0.88

[[Page 51794]]

 
CH4 (thousand tons).....................................             289             592             883           1,111           2,519           2,592
N2O (thousand tons).....................................            0.36            0.72            1.09            1.44            3.64            3.64
--------------------------------------------------------------------------------------------------------------------------------------------------------

    As part of the analysis for this rulemaking, DOE estimated monetary 
benefits likely to result from the reduced emissions of CO2 
that DOE estimated for each of the considered TSLs for consumer clothes 
dryers. Section IV.L.1.a of this document discusses the SC-
CO2 values used.
    Table V.37 presents the present value of the CO2 
emissions reduction at each TSL.

Table V.37--Potential Standards: Present Value of CO2 Emissions Reduction for Consumer Clothes Dryers Shipped in
                                                    2027-2056
----------------------------------------------------------------------------------------------------------------
                                                      SC-CO2 case discount rate and statistics
               TSL                ------------------------------------------------------------------------------
                                      5%, Average        3%, Average       2.5%, Average     3%, 95th percentile
----------------------------------------------------------------------------------------------------------------
                                                                  (million 2020$)
----------------------------------------------------------------------------------------------------------------
1................................                337              1,459              2,284                 4,445
2................................                677              2,945              4,617                 8,963
3................................                993              4,351              6,834                13,236
4................................              1,263              5,558              8,742                16,899
5................................              2,918             12,977             20,475                39,423
6................................              2,966             13,187             20,807                40,061
----------------------------------------------------------------------------------------------------------------

    As discussed in section IV.L.1.b of this document, DOE estimated 
monetary benefits likely to result from the reduced emissions of 
methane and N2O that DOE estimated for each of the 
considered TSLs for consumer clothes dryers. Table V.38 presents the 
value of the CH4 emissions reduction at each TSL, and Table 
V.39 presents the value of the N2O emissions reduction at 
each TSL.

    Table V.38--Potential Standards: Present Value of Methane Emissions Reduction for Consumer Clothes Dryers
                                              Shipped in 2027-2056
----------------------------------------------------------------------------------------------------------------
                                                      SC-CH4 case discount rate and statistics
               TSL                ------------------------------------------------------------------------------
                                      5%, Average        3%, Average       2.5%, Average     3%, 95th percentile
----------------------------------------------------------------------------------------------------------------
                                                                  (million 2020$)
----------------------------------------------------------------------------------------------------------------
1................................                118                350                489                   929
2................................                237                711                994                 1,886
3................................                348              1,052              1,474                 2,789
4................................                432              1,317              1,848                 3,489
5................................                955              2,949              4,151                 7,805
6................................                983              3,035              4,272                 8,032
----------------------------------------------------------------------------------------------------------------


 Table V.39--Potential Standards: Present Value of Nitrous Oxide Emissions Reduction for Consumer Clothes Dryers
                                              Shipped in 2027-2056
----------------------------------------------------------------------------------------------------------------
                                                      SC-N2O case discount rate and statistics
               TSL                ------------------------------------------------------------------------------
                                      5%, Average        3%, Average       2.5%, Average     3%, 95th percentile
----------------------------------------------------------------------------------------------------------------
                                                                  (million 2020$)
----------------------------------------------------------------------------------------------------------------
1................................               1.20               4.81               7.47                  12.8
2................................               2.40               9.71               15.1                  25.9
3................................               3.54               14.4               22.5                  38.4
4................................               4.64               19.0               29.7                  50.6
5................................               11.4               47.2               73.8                   126
6................................               11.4               47.3               74.0                   126
----------------------------------------------------------------------------------------------------------------


[[Page 51795]]

    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 evolve rapidly. Thus, any value placed on 
reduced GHG emissions in this rulemaking is subject to change. That 
said, because of omitted damages, DOE agrees with the IWG that these 
estimates most likely underestimate the climate benefits of greenhouse 
gas reductions. 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 and other rulemakings, as well as other 
methodological assumptions and issues. DOE notes that the proposed 
standards would be economically justified even without inclusion of 
monetized benefits of reduced GHG emissions.
    DOE also estimated the monetary value of the economic impacts 
associated with changes in SO2 emissions anticipated to 
result from the considered TSLs for consumer clothes dryers. The 
dollar-per-ton values that DOE used are discussed in section IV.L.2 of 
this document. Table V.40 presents the present value SO2 
emission changes for each TSL calculated using 7-percent and 3-percent 
discount rates. This table presents results that use the low benefit-
per-ton values, which reflect DOE's primary estimate.

Table V.40--Potential Standards: Present Value of SO2 Emission Reduction
            for Consumer Clothes Dryers Shipped in 2027-2056
------------------------------------------------------------------------
               TSL                 3% Discount rate    7% Discount rate
------------------------------------------------------------------------
                                              (million 2020$)
------------------------------------------------------------------------
1...............................                 773                 318
2...............................               1,552                 628
3...............................               2,298                 911
4...............................               3,039               1,184
5...............................               7,592               2,850
6...............................               7,581               2,845
------------------------------------------------------------------------

    As part of the analysis for this rulemaking, DOE also estimated the 
monetary value of the economic benefits associated with NOX 
emissions reductions anticipated to result from the considered TSLs for 
consumer clothes dryers. The dollar-per-ton values that DOE used are 
discussed in section IV.L of this document. Table V.41 presents the 
present value for NOX emissions reduction for each TSL 
calculated using 7-percent and 3-percent discount rates. The results in 
this table reflect application of the low dollar-per-ton values, which 
DOE used to be conservative. Results that reflect high dollar-per-ton 
values are presented in chapter 14 of the NOPR TSD.

     Table V.41--Potential Standards: Present Value of NOX Emissions
       Reduction for Consumer Clothes Dryers Shipped in 2027-2056
------------------------------------------------------------------------
               TSL                 3% Discount rate    7% Discount rate
------------------------------------------------------------------------
                                              (million 2020$)
------------------------------------------------------------------------
1...............................               2,317                 943
2...............................               4,656               1,858
3...............................               6,842               2,678
4...............................               8,640               3,335
5...............................              19,688               7,339
6...............................              20,094               7,490
------------------------------------------------------------------------
Note: Results are based on the low benefit-per-ton values.

    The benefits of reduced CO2, CH4, and 
N2O emissions are collectively referred to as climate 
benefits. The benefits of reduced SO2 and NOX 
emissions changes are collectively referred to as health benefits. For 
the time series of estimated monetary values of reduced emissions, see 
chapter 14 of the NOPR TSD.
7. Other Factors
    The Secretary of Energy, in determining whether a standard is 
economically justified, may consider any other factors that the 
Secretary deems to be relevant. (42 U.S.C. 6295(o)(2)(B)(i)(VII)) No 
other factors were considered in this analysis.
8. Summary of Economic Impacts
    Table V.42 presents the NPV values that result from adding the 
estimates of the potential monetized estimates of the potential 
economic, climate, and health benefits resulting from reduced GHG, 
NOX, and SO2 emissions to the NPV of consumer 
benefits calculated for each TSL considered in this rulemaking. The 
consumer benefits are domestic U.S. monetary savings that occur as a 
result of purchasing the covered consumer clothes dryers and are 
measured for the lifetime of products shipped in 2027-2056. The climate 
benefits associated with reduced GHG emissions resulting from the 
adopted standards are global benefits and are also calculated based on 
the lifetime of consumer clothes dryers shipped in 2027-2056. The 
climate benefits associated with four SC-GHG estimates are shown. DOE 
does not have a single central SC-GHG point estimate and it emphasizes 
the importance and value of considering the benefits calculated using 
all four SC-GHG estimates.

[[Page 51796]]



  Table V.42--Potential Standards: NPV of Consumer Benefits Combined With Monetized Climate and Health Benefits
                                            From Emissions Reductions
----------------------------------------------------------------------------------------------------------------
             Category                  TSL 1        TSL 2        TSL 3        TSL 4        TSL 5        TSL 6
----------------------------------------------------------------------------------------------------------------
                    3% discount rate for NPV of Consumer and Health Benefits (billion 2020$)
----------------------------------------------------------------------------------------------------------------
5% d.r., Average SC-GHG case......         10.4         21.3         31.3         31.8         59.0         57.3
3% d.r., Average SC-GHG case......         11.8         24.0         35.4         37.0         71.1         69.7
2.5% d.r., Average SC-GHG case....         12.8         26.0         38.3         40.7         79.8         78.5
3% d.r., 95th percentile SC-GHG            15.4         31.2         46.0         50.5          102          102
 case.............................
----------------------------------------------------------------------------------------------------------------
                    7% discount rate for NPV of Consumer and Health Benefits (billion 2020$)
----------------------------------------------------------------------------------------------------------------
5% d.r., Average SC-GHG case......         4.82         9.68         14.0         13.3         21.8         20.9
3% d.r., Average SC-GHG case......         6.18         12.4         18.1         18.5         33.9         33.2
2.5% d.r., Average SC-GHG case....         7.14         14.4         21.0         22.3         42.7         42.1
3% d.r., 95th percentile SC-GHG            9.75         19.6         28.7         32.1         65.3         65.2
 case.............................
----------------------------------------------------------------------------------------------------------------

C. Conclusion

    When considering new or amended energy conservation standards, the 
standards that DOE adopts for any type (or class) of covered product 
must be designed to achieve the maximum improvement in energy 
efficiency that the Secretary determines is technologically feasible 
and economically justified. (42 U.S.C. 6295(o)(2)(A)) In determining 
whether a standard is economically justified, the Secretary must 
determine whether the benefits of the standard exceed its burdens by, 
to the greatest extent practicable, considering the seven statutory 
factors discussed previously. (42 U.S.C. 6295(o)(2)(B)(i)) The new or 
amended standard must also result in significant conservation of 
energy. (42 U.S.C. 6295(o)(3)(B))
    For this NOPR, DOE considered the impacts of amended standards for 
consumer clothes dryers at each TSL, beginning with the maximum 
technologically feasible level, to determine whether that level was 
economically justified. Where 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 refers to this process as the ``walk-
down'' analysis.
    To aid the reader as DOE discusses the benefits and/or burdens of 
each TSL, tables in this section present a summary of the results of 
DOE's quantitative analysis for each TSL. In addition to the 
quantitative results presented in the tables, DOE also considers other 
burdens and benefits that affect economic justification. These include 
the impacts on identifiable subgroups of consumers who may be 
disproportionately affected by a national standard and impacts on 
employment.
    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. 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, (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 (for example, between 
renters and owners, or builders and purchasers). Having 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.
    In DOE's current regulatory analysis, potential changes in the 
benefits and costs of a regulation due to changes in consumer purchase 
decisions are included in two ways. First, if consumers forgo the 
purchase of a product in the standards case, this decreases sales for 
product manufacturers, and the impact on manufacturers attributed to 
lost revenue is included in the MIA. Second, DOE accounts for energy 
savings attributable only to products actually used by consumers in the 
standards case; if a standard decreases the number of products 
purchased by consumers, this decreases the potential energy savings 
from an energy conservation standard. DOE provides estimates of 
shipments and changes in the volume of product purchases in chapter 9 
of the NOPR TSD. However, DOE's current analysis does not explicitly 
control for heterogeneity in consumer preferences, preferences across 
subcategories of products or specific features, or consumer price 
sensitivity variation according to household income.\86\
---------------------------------------------------------------------------

    \86\ P.C. Reiss and M.W. White. Household Electricity Demand, 
Revisited. Review of Economic Studies. 2005. 72(3): pp. 853-883. 
doi: 10.1111/0034-6527.00354.
---------------------------------------------------------------------------

    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 energy conservation standard, 
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 has posted a paper that discusses 
the issue of consumer welfare impacts of appliance energy conservation 
standards, and potential enhancements to the methodology by which these 
impacts are defined and estimated in the regulatory process.\87\ DOE 
welcomes comments on how to more fully assess the potential impact of 
energy conservation standards on consumer choice and how to quantify 
this impact in its regulatory analysis in future rulemakings.
---------------------------------------------------------------------------

    \87\ Sanstad, A.H. Notes on the Economics of Household Energy 
Consumption and Technology Choice. 2010. Lawrence Berkeley National 
Laboratory. Available at www1.eere.energy.gov/buildings/appliance_standards/pdfs/consumer_ee_theory.pdf (last accessed 
November 12, 2021).
---------------------------------------------------------------------------

1. Benefits and Burdens of TSLs Considered for Consumer Clothes Dryers 
Standards
    Table V.43 and Table V.44 summarize the quantitative impacts 
estimated for each TSL for consumer clothes dryers.

[[Page 51797]]

The national impacts are measured over the lifetime of consumer clothes 
dryers purchased in the 30-year period that begins in the anticipated 
year of compliance with amended standards (2027-2056). The energy 
savings, emissions reductions, and value of emissions reductions refer 
to full-fuel-cycle results. The efficiency levels contained in each TSL 
are described in section V.A of this document. In addition, as DOE 
noted in section V.A of this document, DOE is evaluating proposed 
energy conservation standards by looking at the maximum improvement 
that is technologically feasible and cost justified under bundled 
policy scenarios referred to as TSLs. Since there are not cross 
elasticities modeled in this proposed rulemaking for consumer clothes 
dryers, the cost analysis and associated justification would be the 
same if DOE evaluated at the individual product class level.

          Table V.43--Summary of Analytical Results for Consumer Clothes Dryers TSLs: National Impacts
----------------------------------------------------------------------------------------------------------------
             Category                  TSL 1        TSL 2        TSL 3        TSL 4        TSL 5        TSL 6
----------------------------------------------------------------------------------------------------------------
                                 Cumulative FFC National Energy Savings (quads)
----------------------------------------------------------------------------------------------------------------
Quads.............................         1.01         2.07         3.11         4.06         9.97         10.1
----------------------------------------------------------------------------------------------------------------
                            Cumulative FFC Emissions Reduction (Total FFC Emissions)
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons).........         37.9         77.3          116          149          354          360
SO2 (thousand tons)...............         13.9         28.3         42.6         57.2          147          147
NOX (thousand tons)...............         59.4          121          181          228          516          531
Hg (tons).........................         0.08         0.17         0.26         0.34         0.88         0.88
CH4 (thousand tons)...............          289          592          883        1,111        2,519        2,592
N2O (thousand tons)...............         0.36         0.72         1.09         1.44         3.64         3.64
----------------------------------------------------------------------------------------------------------------
                 Present Value of Monetized Benefits and Costs (3% discount rate, billion 2020$)
----------------------------------------------------------------------------------------------------------------
Consumer Operating Cost Savings...         7.50         15.1         22.2         28.8         69.5         69.8
Climate Benefits *................         1.81         3.67         5.42         6.89         16.0         16.3
Health Benefits **................         3.09         6.21         9.14         11.7         27.3         27.7
Total Benefits [dagger]...........         12.4         24.9         36.8         47.4          113          114
Consumer Incremental Product Costs         0.61         0.92         1.36         10.4         41.7         44.1
 [Dagger].........................
Consumer Net Benefits.............         6.90         14.1         20.8         18.4         27.8         25.7
Total Net Benefits................         11.8         24.0         35.4         37.0         71.1         69.7
----------------------------------------------------------------------------------------------------------------
                Present Value of Monetized Benefits and Costs (7% discount rate, billions 2020$)
----------------------------------------------------------------------------------------------------------------
Consumer Operating Cost Savings...         3.45         6.80         9.83         12.6         29.2         29.3
Climate Benefits *................         1.81         3.67         5.42         6.89         16.0         16.3
Health Benefits **................         1.26         2.49         3.59         4.52         10.2         10.3
Total Benefits [dagger]...........         6.53         13.0         18.8         24.0         55.4         55.9
Consumer Incremental Product Costs         0.35         0.52         0.76         5.42         21.4         44.1
 [Dagger].........................
Consumer Net Benefits.............         3.10         6.28         9.07         7.13         7.76         6.60
Total Net Benefits................         6.18         12.4         18.1         18.5         33.9         33.2
----------------------------------------------------------------------------------------------------------------
Note: This table presents the costs and benefits associated with consumer clothes dryers shipped in 2027-2056.
  These results include benefits to consumers which accrue after 2056 from the products shipped in 2027-2056.
* Climate benefits are calculated using four different estimates of the social cost of carbon (SC-CO2), methane
  (SC-CH4), and nitrous oxide (SC-N2O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates;
  95th percentile at 3 percent discount rate). Together these represent the global social cost of greenhouse
  gases (SC-GHG). For presentational purposes of this table, the climate benefits associated with the average SC-
  GHG at a 3 percent discount rate are shown, but the Department does not have a single central SC-GHG point
  estimate. See section. IV.L of this document for more details. On March 16, 2022, the Fifth Circuit Court of
  Appeals (No. 22-30087) granted the Federal government's emergency motion for stay pending appeal of the
  February 11, 2022, preliminary injunction issued in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a
  result of the Fifth Circuit's order, the preliminary injunction is no longer in effect, pending resolution of
  the Federal government's appeal of that injunction or a further court order. Among other things, the
  preliminary injunction enjoined the defendants in that case from ``adopting, employing, treating as binding,
  or relying upon'' the interim estimates of the social cost of greenhouse gases--which were issued by the
  Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 2021--to monetize the
  benefits of reducing greenhouse gas emissions. As reflected in this rule, DOE has reverted to its approach
  prior to the injunction and presents monetized greenhouse gas abatement benefits where appropriate and
  permissible under law.
** Health benefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only monetizing
  (for SO2 and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits, but will
  continue to assess the ability to monetize other effects such as health benefits from reductions in direct
  PM2.5 emissions. The health benefits are presented at real discount rates of 3 and 7 percent. See section IV.L
  of this document for more details.
[dagger] Total and net benefits include those consumer, climate, and health benefits that can be monetized. For
  presentation purposes, total and net benefits for both the 3-percent and 7-percent cases are presented using
  the average SC-GHG with 3-percent discount rate, but the Department does not have a single central SC-GHG
  point estimate. DOE emphasizes the importance and value of considering the benefits calculated using all four
  SC-GHG estimates.
[Dagger] Costs include incremental equipment costs as well as installation costs.


[[Page 51798]]


                      Table V.44--Summary of Analytical Results for Consumer Clothes Dryers TSLs: Manufacturer and Consumer Impacts
--------------------------------------------------------------------------------------------------------------------------------------------------------
            Category                    TSL 1 *             TSL 2 *             TSL 3 *             TSL 4 *             TSL 5 *             TSL 6 *
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                  Manufacturer Impacts
--------------------------------------------------------------------------------------------------------------------------------------------------------
Industry NPV (million 2020$) (No- 1,785.0 to 1,798.5  1,766.8 to 1,789.8  1,694.5 to 1,728.5  1,368.8 to 1,582.5  830.1 to 1,675.5..  732.4 to 1,632.0.
 new-standards case INPV =
 1,810.1).
Industry NPV (% change).........  (1.4) to (0.6)....  (2.4) to (1.1)....  (6.4) to (4.5)....  (24.4) to (12.6)..  (54.1) to (7.4)...  (59.5) to (9.8).
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          Consumer Average LCC Savings (2020$)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Electric Standard...............  $252..............  $439..............  $578..............  $182..............  $230..............  $230.
Electric Compact (120 V)........  $115..............  $194..............  $160..............  $160..............  $86.3.............  ($62.6).
Vented Electric Compact (240 V).  $94.1.............  $201..............  $192..............  $192..............  $123..............  ($94.8).
Vented Gas Standard.............  $77.7.............  $174..............  $198..............  $198..............  $198..............  $43.0.
Vented Gas Compact..............  $25.2.............  $23.5.............  $25.2.............  ..................  $29.4.............  ($38.8).
Ventless Electric Compact (240    ..................  $145..............  $145..............  $145..............  $145..............  $11.0.
 V).
Ventless Electric Combination     ..................  $15.1.............  $15.1.............  $15.1.............  $15.1.............  ($387).
 Washer/Dryer.
Shipment-Weighted Average *.....  $219..............  $390..............  $507..............  $184..............  $222..............  $191.
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               Consumer Simple PBP (years)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Electric Standard...............  0.7...............  0.6...............  0.6...............  1.7...............  4.0...............  4.0.
Electric Compact (120 V)........  1.7...............  1.5...............  1.8...............  1.8...............  5.3...............  11.0.
Vented Electric Compact (240 V).  2.0...............  1.5...............  1.6...............  1.6...............  4.7...............  12.1.
Vented Gas Standard.............  2.8...............  1.6...............  1.9...............  1.9...............  1.9...............  5.5.
Vented Gas Compact..............  5.1...............  6.4...............  5.1...............  0.0...............  7.1...............  16.3.
Ventless Electric Compact (240    ..................  0.3...............  0.3...............  0.3...............  0.3...............  7.1.
 V).
Ventless Electric Combination     ..................  0.................  0.................  0.................  0.................  27.5.
 Washer-Dryer.
Shipment-Weighted Average *.....  1.0...............  0.8...............  0.8...............  1.7...............  3.6...............  4.5.
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Percent of Consumers that Experience a Net Cost
--------------------------------------------------------------------------------------------------------------------------------------------------------
Electric Standard...............  0.32%.............  0.16%.............  0.11%.............  53.5%.............  53.1%.............  53.1%.
Electric Compact (120 V)........  5.66%.............  4.46%.............  21.6%.............  21.6%.............  53.0%.............  76.3%.
Vented Electric Compact (240 V).  8.63%.............  4.35%.............  8.37%.............  8.37%.............  47.0%.............  79.6%.
Vented Gas Standard.............  6.04%.............  1.66%.............  3.74%.............  3.74%.............  3.74%.............  59.3%.
Vented Gas Compact..............  32.7%.............  50.2%.............  32.7%.............  ..................  51.9%.............  78.8%.
Ventless Electric Compact (240    ..................  0%................  0%................  0%................  0%................  66.4%.
 V).
Ventless Electric Combination     ..................  0%................  0%................  0%................  0%................  89.8%.
 Washer-Dryer.
Shipment-Weighted Average *.....  1.33%.............  0.45%.............  0.81%.............  44.4%.............  44.5%.............  54.7%.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Parentheses indicate negative (-) values.
* Weighted by shares of each product class in total projected shipments in 2027.

    DOE first considered TSL 6, which represents the max-tech 
efficiency levels, which includes the design parameters of the most 
efficient products available on the market or in working prototypes for 
all product classes. The max-tech design options include heat pump 
technology for electric consumer clothes dryers and inlet air preheat 
technology for gas consumer clothes dryers. DOE's shipments analysis 
estimates approximately 1 percent of annual consumer clothes dryer 
shipments currently meet this level. TSL 6 would save an estimated 10.1 
quads of energy, an amount DOE considers significant. Under TSL 6, the 
NPV of consumer benefit would be $6.60 billion using a discount rate of 
7 percent, and $25.7 billion using a discount rate of 3 percent.
    The cumulative emissions reductions at TSL 6 are 360 Mt of 
CO2, 147 thousand tons of SO2, 531 thousand tons 
of NOX, 0.88 ton of Hg, 2,592 thousand tons of 
CH4, and 3.64 thousand tons of N2O. The estimated 
monetary value of the climate benefits from reduced GHG emissions 
(associated with the average SC-GHG at a 3-percent discount rate) at 
TSL 6 is $16.3 billion. The estimated monetary value of the health 
benefits from reduced SO2 and NOX emissions at 
TSL 6 is $10.3 billion using a 7-percent discount rate and $27.7 
billion using a 3-percent discount rate.
    Using a 7-percent discount rate for consumer benefits and costs, 
health benefits from reduced SO2 and NOX 
emissions, and the 3-percent discount rate case for climate benefits 
from reduced GHG emissions, the estimated total NPV at TSL 6 is $33.2 
billion. Using a 3-percent discount rate for all benefits and costs, 
the estimated total NPV at TSL 6 is $69.7 billion.

[[Page 51799]]

    At TSL 6, the average LCC impact on affected consumers is a savings 
of $230 for electric standard (PC1), ($62.6) for electric compact 
(120V) (PC2), ($94.8) for vented electric compact (240V) (PC3), $43.0 
for vented gas standard (PC4), ($38.8) for vented gas compact (PC5), 
$11.0 for ventless electric compact (240V) (PC6), and ($387) for 
ventless electric combination washer-dryer (PC7). The simple payback 
period is 4.0 years for PC1, 11.0 years for PC2, 12.1 years for PC3, 
5.5 years for PC4, 16.3 years for PC5, 7.1years for PC6, and 27.5 years 
for PC7. The fraction of consumers experiencing a net LCC cost is 53.1 
percent for PC1, 76.3 percent for PC2, 79.6 percent for PC3, 59.3 
percent for PC4, 78.8 percent for PC5, 66.4 percent for PC6, and 89.8 
percent for PC7. Overall, across the product classes a majority of 
consumers will experience a net LCC cost, especially for senior 
households. DOE estimated that more 65 percent of senior consumers will 
experience a net LCC cost at TSL 6.
    At TSL 6, the projected change in INPV ranges from a decrease of 
$1,077.6 million to a decrease of $178.0 million, which correspond to 
decreases of 59.5 percent and 9.8 percent, respectively. The loss in 
INPV is largely driven by industry conversion costs as manufacturer 
work to redesign their portfolio of model offerings and re-tool entire 
factories to comply with amended standards at this level. Industry 
conversion costs could reach $1,280.0 million at this TSL.
    Conversion costs at TSL 6 are significant as nearly all existing 
consumer clothes dryer models would need to be redesigned to meet the 
max-tech efficiencies. For the electric clothes dryer product classes, 
manufacturers would need to implement the most efficient heat pump 
technology to meet max-tech levels. Of the eight OEMs that offer 
domestic heat pump models, four of them already offer models that meet 
the efficiencies required by TSL 6. These four OEMs specialize in high-
efficiency clothes dryers, but currently produce low volumes of 
products for the U.S. market. For the other four manufacturers of heat 
pump models, which have the most domestic sales and account for an 
estimated 72 percent of total annual clothes dryer shipments, TSL 6 
would require substantial additional investments to their current heat 
pump product lines to produce cost-optimized models at the max-tech 
efficiency level. Seven out of 15 OEMs identified do not offer any 
models for the domestic market that utilize heat pump technology. A 
standard that could only be met using heat pump technology would 
require a total renovation of existing production facilities and would 
require most manufacturers to design completely new clothes dryer 
platforms, as they would not be able to maintain the resistive heating 
designs that currently dominate the U.S. electric clothes dryer market. 
In interviews, several manufacturers expressed concern about a 
potential shortage of products given the required scale of investment, 
redesign efforts, and compliance timeline.
    For gas clothes dryers, manufacturers would need to implement inlet 
air preheat technology along with other design options to meet the 
efficiency levels required by TSL 6. Thus far, dryers with this 
technology and performance have not been observed in clothes dryers 
available on the consumer market. Clothes dryers with inlet air preheat 
designs have been observed only in laboratory settings. In interviews, 
some manufacturers raised concerns about implementing a relatively 
untested technology for the consumer market. There is very little 
industry experience with inlet air preheat designs. Several 
manufacturers speculated that implementing inlet air preheat would 
require a major overhaul of existing production facilities and a 
significant amount of engineering time.
    At this level, DOE estimated a 13-percent drop in shipments in the 
year the standard takes effect, as price-sensitive consumers may forgo 
purchasing a new clothes dryer or rely on alternatives such as 
laundromats or clothes dryer rentals due to the increased upfront cost 
of baseline models.
    The Secretary tentatively concludes that at TSL 6 for consumer 
clothes dryers, the benefits of energy savings, positive NPV of 
consumer benefits, emission reductions, and the estimated monetary 
value of the emissions reductions would be outweighed by the economic 
burden on many consumers, especially senior consumers, as well as the 
impacts on manufacturers, including the potential for large conversion 
costs and reduction in INPV.
    TSL 6, representing the most efficient heat pump technology on the 
market, would provide significant energy savings potential, as 
discussed.
    Despite the current and potential future benefits of heat pump 
technology, at TSL 6, the analysis indicates that a significant 
fraction of electric and vented gas standard clothes dryer consumers, 
including low-income and senior consumers, would experience a net cost 
given the current relatively high incremental cost of electric and 
vented gas standard clothes dryers at the max-tech efficiency level. 
This is particularly pronounced for electric standard clothes dryers, 
where the incremental production cost at the max-tech efficiency level 
is comparable to the manufacturer production cost for the baseline 
efficiency level. Consumers with existing electric standard clothes 
dryers below EL 4 (about 34 percent) and consumers with existing vented 
gas standard clothes dryers below EL 3 (about 58 percent) are more 
likely to experience a net cost at TSL 6, given the relatively modest 
decrease in operating costs compared to the high incremental installed 
costs. Few products currently meet the efficiency levels required by 
TSL 6. DOE estimates that approximately 1 percent of current shipments 
meet the max-tech efficiencies. At max-tech, limited industry 
experience by certain manufacturers with the high-efficiency design 
options, the large conversion costs to update facilities and product 
designs, and expected drop in industry shipments would result in a 
reduction of INPV and a potential shortage of products given the 
required scale of investment, redesign efforts, and time constraints. 
Consequently, the Secretary has tentatively concluded that TSL 6 is not 
economically justified.
    DOE then considered TSL 5, which represents the maximum energy 
savings with positive NPV. TSL 5 corresponds to the max-tech level, 
which represents heat pump technology, for the electric standard 
product class, and the ELs corresponding to inlet air preheat 
technology in the electric compact (120V) and vented electric compact 
(240V) product classes considered in this analysis. For gas consumer 
clothes dryer product classes, TSL 5 corresponds to EL 3, which 
represents modulating (2-stage) heating technology. TSL 5 would save an 
estimated 9.97 quads of energy, an amount DOE considers significant. 
Under TSL 5, the NPV of consumer benefit would be $7.76 billion using a 
discount rate of 7 percent, and $27.8 billion using a discount rate of 
3 percent.
    The cumulative emissions reductions at TSL 5 are 354 Mt of 
CO2, 147 thousand tons of SO2, 516 thousand tons 
of NOX, 0.88 ton of Hg, 2,519 thousand tons of 
CH4, and 3.64 thousand tons of N2O. The estimated 
monetary value of the climate benefits from reduced GHG emissions 
(associated with the average SC-GHG at a 3-percent discount rate) at 
TSL 5 is $16.0 billion. The estimated monetary value of the health 
benefits from reduced SO2 and NOX emissions at 
TSL 5 is $ 10.2 billion using a 7-percent discount rate and $27.3 
billion using a 3-percent discount rate.

[[Page 51800]]

    Using a 7-percent discount rate for consumer benefits and costs, 
health benefits from reduced SO2 and NOX 
emissions, and the 3-percent discount rate case for climate benefits 
from reduced GHG emissions, the estimated total NPV at TSL 5 is $33.9 
billion. Using a 3-percent discount rate for all benefits and costs, 
the estimated total NPV at TSL 5 is $71.1 billion.
    At TSL 5, the average LCC impact on affected consumers is a savings 
of $230 for electric standard (PC1), $86.3 for electric compact (120V) 
(PC2), $123 for vented electric compact (240V) (PC3), $198 for vented 
gas standard (PC4), $29.4 for vented gas compact (PC5), $145 for 
ventless electric compact (240V) (PC6), and $15.1 for ventless electric 
combination washer-dryer (PC7). The simple payback period is 4.0 years 
for PC1, 5.3 years for PC2, 4.7 years for PC3, 1.9 years for PC4, 7.1 
years for PC5, 0.3 years for PC6, and 0 years for PC7. The fraction of 
consumers experiencing a net LCC cost is 53.1 percent for PC1, 53.0 
percent for PC2, 47.0 percent for PC3, 3.74 percent for PC4, 51.9 
percent for PC5, zero percent for PC6 and PC 7. Overall, across the 
product classes, more than 40 percent of the consumers will experience 
a net LCC cost, especially for senior households. DOE estimated that 
more 55 percent of senior consumers will experience a net LCC cost at 
TSL 5.
    At TSL 5, the projected change in INPV ranges from a decrease of 
$980.0 million to a decrease of $134.5 million, which correspond to 
decreases of 54.1 percent and 7.4 percent, respectively. Industry 
conversion costs could reach $1,164.2 million at this TSL.
    DOE's shipments analysis estimates approximately 9 percent of 
annual shipments currently meet this level. The efficiency level for 
electric standard dryers, which account for 81 percent of annual 
shipments, is the same as at max-tech, and would be associated with the 
same current and potential future benefits as the market share of 
clothes dryers with heat pump technology continues to grow over time. 
Nonetheless, requiring heat pump technology for electric standard 
dryers at this time would result in similar conversion costs, reduction 
in INPV, and drop in shipments as TSL 6. For the electric compact 
(120V) and vented electric compact (240V) dryers, the design options 
include implementing inlet air preheat. In its review of the compact 
electric models commercially available on the U.S. market at this time, 
DOE did not identify any that incorporate the inlet air preheat 
technology option.
    For the vented gas product classes, which account for approximately 
17 percent of total annual shipments, the design options include 
implementing modulating (2-stage) heating technology along with other 
features. DOE's shipments analysis estimates that approximately 43 
percent of gas clothes dryer shipments currently meet the efficiencies 
required by TSL 5. All seven manufacturers of gas clothes dryers offer 
products that meet or exceed the efficiencies required at TSL 5. DOE 
does not believe that there are any substantive barriers to modulating 
(2-stage) heating technology. Capital conversion costs would be 
necessary as manufacturers increase tooling for 2-stage heating 
systems. Product conversion costs would be necessary for cost-
optimizing and testing new designs for a market with amended standards.
    At this level, DOE expects an estimated 12-percent drop in 
shipments in the year the standard takes effect, as price-sensitive 
consumers may forgo purchasing a new clothes dryer or rely on 
alternatives such as laundromats or clothes dryer rentals due to the 
increased upfront cost of baseline models.
    The Secretary tentatively concludes that at TSL 5 for consumer 
clothes dryers, the benefits of energy savings, positive NPV of 
consumer benefits, emission reductions, and the estimated monetary 
value of the emissions reductions would be outweighed by the economic 
burden on many consumers, especially senior consumers, as well as the 
impacts on manufacturers, including the significant conversion costs 
and large potential reduction in INPV. A significant fraction of 
electric standard clothes dryer consumers, including low-income and 
senior consumers, would experience a net cost. This is due to the high 
incremental cost of electric standard clothes dryers at the max-tech 
efficiency level. Consumers with existing electric standard clothes 
dryers below EL 4 are more likely to experience a net cost at TSL 5, 
given the relatively modest decrease in operating costs compared to the 
high incremental installed costs. DOE estimates that approximately 9 
percent of shipments currently meet the efficiencies required by this 
TSL. At TSL 5, the limited industry experience with the high-efficiency 
design options, particularly for electric standard dryers which account 
for 81 percent of total shipments, the substantial conversion costs 
required to update facilities and product designs, and expected drop in 
industry shipments would result in a reduction in INPV and a potential 
shortage of electric standard dryers given the scale of required 
investment, redesign efforts, and time constraints. Consequently, the 
Secretary has tentatively concluded that TSL 5 is not economically 
justified.
    DOE then considered TSL 4, which represents the maximum national 
energy savings with simple PBP less than 4 years for each product 
class. TSL 4 corresponds to the EL that represents inlet air preheat 
technology for the electric standard product class considered in this 
analysis. For the electric compact (120V) and vented electric compact 
(240V) product classes, TSL 4 corresponds to EL 4, which represents 
modulating (2-stage) heating technology. For the vented gas standard 
product class, TSL 4 corresponds to EL 3 which also represents 
modulating (2-stage) heating technology. TSL 4 would save an estimated 
4.06 quads of energy, an amount DOE considers significant. Under TSL 4, 
the NPV of consumer benefit would be $7.13 billion using a discount 
rate of 7 percent, and $18.4 billion using a discount rate of 3 
percent.
    The cumulative emissions reductions at TSL 4 are 149 Mt of 
CO2, 57.2 thousand tons of SO2, 228 thousand tons 
of NOX, 0.34 ton of Hg, 1,111 thousand tons of 
CH4, and 1.44 thousand tons of N2O. The estimated 
monetary value of the climate benefits from reduced GHG emissions 
(associated with the average SC-GHG at a 3-percent discount rate) at 
TSL 4 is $6.89 billion. The estimated monetary value of the health 
benefits from reduced SO2 and NOX emissions at 
TSL 4 is $4.52 billion using a 7-percent discount rate and $11.7 
million using a 3-percent discount rate.
    Using a 7-percent discount rate for consumer benefits and costs, 
health benefits from reduced SO2 and NOX 
emissions, and the 3-percent discount rate case for climate benefits 
from reduced GHG emissions, the estimated total NPV at TSL 4 is $18.5 
billion. Using a 3-percent discount rate for all benefits and costs, 
the estimated total NPV at TSL 4 is $37.0 billion.
    At TSL 4, the average LCC impact on affected consumers is a savings 
of $182 for electric standard (PC1), $160 for electric compact (120V) 
(PC2), $192 for vented electric compact (240V) (PC3), $198 for vented 
gas standard (PC4), $145 for ventless electric compact (PC6), and $15.1 
for ventless electric combination washer-dryer (PC7). The simple 
payback period is 1.7 years for PC1, 1.8 years for PC2, 1.6 years for 
PC3, 1.9 years for PC4, 0.3 years for PC6, and 0 years for PC7. The 
fraction of consumers experiencing a net LCC cost is 53.5 percent for 
PC1, 21.6 percent for

[[Page 51801]]

PC2, 8.37 percent for PC3, 3.74 percent for PC4, zero percent for PC6 
and PC 7.\88\ Overall, across the product classes, more than 40 percent 
of the consumers will experience a net LCC cost, especially for senior 
households. DOE estimated that about 50 percent of senior consumers 
will experience a net LCC cost at TSL 4.
---------------------------------------------------------------------------

    \88\ No economic impact values are reported for product class 5 
under TSL4 because energy efficiency level for the product class is 
at baseline.
---------------------------------------------------------------------------

    At TSL 4, the projected change in INPV ranges from a decrease of 
$441.3 million to a decrease of $227.6 million, which correspond to 
decreases of 24.4 percent and 12.6 percent, respectively. Industry 
conversion costs could reach $561.7 million at this TSL.
    At TSL 4, the majority of consumer clothes dryer models would need 
to be redesigned to meet the efficiency levels required. DOE's 
shipments analysis estimates approximately 11 percent of current 
shipments meet this level. For electric standard dryers, the design 
options include implementing inlet air preheat and other features. As 
previously noted, electric standard dryers account for approximately 81 
percent of total shipments. There is very little industry experience 
with inlet air preheat designs. Currently, DOE is not aware of any 
consumer clothes dryers on the market utilizing this design option. 
DOE's shipments analysis estimates that approximately 4 percent of 
electric standard shipments currently meet the efficiency required by 
TSL 4. Implementing inlet air preheat for electric standard dryers 
would represent a major overhaul of existing product lines and 
manufacturing facilities. This change would necessitate significant 
investments in new equipment and tooling. Product conversion costs 
would be necessary for designing, prototyping, and testing new or 
updated platforms.
    For vented gas standard clothes dryers, the design options at TSL 4 
are the same as at TSL 5. DOE does not believe that there are any 
substantive barriers to modulating (2-stage) heating technology. 
Capital conversion costs may be necessary as manufacturers increase 
tooling for 2-stage heating systems. Product conversion costs may be 
necessary for cost-optimizing and testing new designs for a market with 
amended standards.
    At this level, DOE does not expect a notable drop in shipments in 
the year the standard takes effect.
    The Secretary tentatively concludes that at TSL 4 for consumer 
clothes dryers, the benefits of energy savings, positive NPV of 
consumer benefits, emission reductions, and the estimated monetary 
value of the emissions reductions would be outweighed by the economic 
burden on many consumers, especially senior consumers, as well as the 
impacts on manufacturers, including the conversion costs and profit 
margin impacts that could result in a large reduction in INPV. A 
significant fraction of electric standard clothes dryer consumers, 
including senior consumers, would experience a net cost. This is due to 
the high incremental cost of electric standard clothes dryers at the 
inlet air preheat technology efficiency level. Consumers with existing 
electric standard clothes dryers below EL 4 are more likely to 
experience a net cost at TSL 4, given the relatively modest decrease in 
operating costs compared to the high incremental installed costs. 
Consequently, the Secretary has tentatively concluded that TSL 4 is not 
economically justified.
    DOE then considered TSL 3, which represents a set of intermediate 
efficiency levels between those designated in TSL 2 and TSL 4 and 
corresponds to the current ENERGY STAR efficiency level for vented 
electric standard dryers, which represent over 80 percent of the 
market. TSL 3 corresponds to the EL that represents modulating (2-
stage) heating technology for the electric standard, electric compact 
(120V), and vented electric compact (240V) product classes. For the 
vented gas standard product class, TSL 3 corresponds to EL 3, which 
also represents modulating (2-stage) heating technology. For the vented 
gas compact product class, TSL 3 corresponds to EL 1, which represents 
a baseline model with electronic controls. For the ventless electric 
(240V) product class, TSL 3 corresponds to EL 1, which represents a 
baseline model with a more advanced automatic termination control 
system. For the ventless electric combination washer-dryer product 
class, TSL 3 corresponds to EL 1, which represents a baseline model 
with high-speed spin technology. TSL 3 would save an estimated 3.11 
quads of energy, an amount DOE considers significant. Under TSL 3, the 
NPV of consumer benefit would be $9.07 billion using a discount rate of 
7 percent, and $20.8 billion using a discount rate of 3 percent.
    The cumulative emissions reductions at TSL 3 are 116 Mt of 
CO2, 42.6 thousand tons of SO2, 181 thousand tons 
of NOX, 0.26 ton of Hg, 883 thousand tons of CH4, 
and 1.09 thousand tons of N2O. The estimated monetary value 
of the climate benefits from reduced GHG emissions (associated with the 
average SC-GHG at a 3-percent discount rate) at TSL 3 is $5.42 billion. 
The estimated monetary value of the health benefits from reduced 
SO2 and NOX emissions at TSL 3 is $3.59 billion 
using a 7-percent discount rate and $9.14 billion using a 3-percent 
discount rate.
    Using a 7-percent discount rate for consumer benefits and costs, 
health benefits from reduced SO2 and NOX 
emissions, and the 3-percent discount rate case for climate benefits 
from reduced GHG emissions, the estimated total NPV at TSL 3 is $18.1 
billion. Using a 3-percent discount rate for all benefits and costs, 
the estimated total NPV at TSL 3 is $35.4 billion.
    At TSL 3, the average LCC impact on affected consumers is a savings 
of $578 for electric standard (PC1), $160 for electric compact (120V) 
(PC2), $192 for vented electric compact (240V) (PC3), $198 for vented 
gas standard (PC4), $25.2 for PC5, $145 for ventless electric compact 
(PC6), and $15.1 for ventless electric combination washer-dryer (PC7). 
The simple payback period is 0.6 years for the largest product class 
(PC1), 1.8 years for PC2, 1.6 years for PC3, 1.9 years for PC4, 5.1 
years for PC5, 0.3 years for PC6, and 0 years for PC7. The fraction of 
consumers experiencing a net LCC cost is 0.11 percent for PC1, 21.6 
percent for PC2, 8.37 percent for PC3, 3.74 percent for PC4, 32.7 
percent for PC5, and zero percent for PC6 and PC7. Overall, across the 
product classes, less than 1 percent of the consumers, including low-
income consumers, will experience a net LCC cost. For senior consumers, 
DOE estimated that 1 percent will experience a net LCC cost at TSL 3.
    At TSL 3, the projected change in INPV ranges from a decrease of 
$115.6 million to a decrease of $81.6 million, which correspond to 
decreases of 6.4 percent and 4.5 percent, respectively. Industry 
conversion costs could reach $149.7 million at this TSL.
    DOE expects that some existing consumer clothes dryer models would 
need to be redesigned to meet TSL 3 efficiencies, but there are a wide 
range of available models for vented electric standard dryers due to 
participation in the ENERGY STAR program. DOE's shipments analysis 
estimates approximately 59 percent of annual shipments currently meet 
this level. For electric standard, compact electric (120V), vented 
electric compact (240V), and vented gas standard clothes dryers, which 
account for over 98 percent of total annual shipments, the design 
options include implementing electronic controls, optimized heating 
systems, more advanced automatic termination controls, and modulating 
(2-stage) heat. Of the 15 electric dryer

[[Page 51802]]

OEMs, 13 offer products at or above the efficiencies required for the 
electric dryer product classes at TSL 3. As previously noted, all seven 
OEMs of vented gas standard dryers offer products at or above the 
efficiency required at TSL 3. Capital conversion costs may be necessary 
as manufacturers increase tooling for 2-stage heating systems. 
Manufacturers may choose to further cost-optimize and test new designs 
as a result of the standards, but DOE believes some of this has already 
occurred in response to ENERGY STAR for vented electric standard 
dryers. DOE does not expect any drop in shipments in the year the 
standard takes effect.
    After considering the analysis and weighing the benefits and 
burdens, the Secretary has tentatively concluded that a standard set at 
TSL 3 for consumer clothes dryers would result in the maximum 
improvement in energy efficiency that is technologically feasible and 
economically justified and would result in the significant conservation 
of energy. At this TSL, the average LCC savings for all consumer 
clothes dryer product classes are positive. An estimated weighted 
average of less than 1 percent of consumer clothes dryer consumers 
would experience a net cost. The FFC national energy savings are 
significant and the NPV of consumer benefits is positive using both a 
3-percent and 7-percent discount rate. Notably, the benefits to 
consumers vastly outweigh the cost to manufacturers. At TSL 3, the NPV 
of consumer benefits, even measured at the more conservative discount 
rate of 7 percent, is over 78 times higher than the maximum estimated 
manufacturers' loss in INPV. The positive LCC savings--a different way 
of quantifying consumer benefits--reinforces this conclusion. The 
standard levels at TSL 3 are economically justified even without 
weighing the estimated monetary value of emissions reductions. When 
those emissions reductions are included--representing $5.42 billion in 
climate benefits (associated with the average SC-GHG at a 3-percent 
discount rate), and $9.14 billion (using a 3-percent discount rate) or 
$3.59 billion (using a 7-percent discount rate) in health benefits--the 
rationale becomes stronger still.
    As stated, DOE conducts a ``walk-down'' analysis to determine the 
TSL that represents the maximum improvement in energy efficiency that 
is technologically feasible and economically justified as required 
under EPCA. The walk-down is not a comparative analysis, as a 
comparative analysis would result in the maximization of net benefits 
instead of energy savings that are technologically feasible and 
economically justified, and would be contrary to the statute. 86 FR 
70892, 70908. Although DOE has not conducted a comparative analysis to 
select the proposed energy conservation standards, DOE notes that as 
compared to TSL 6, TSL 5, and TSL 4--TSL 3 has higher average LCC 
savings, smaller percentages of consumer experiencing a net cost, a 
lower maximum decrease in INPV, and lower manufacturer conversion 
costs.
    Accordingly, the Secretary has tentatively concluded that TSL 3 
would offer the maximum improvement in efficiency that is 
technologically feasible and economically justified and would result in 
the significant conservation of energy. For electric standard and 
vented gas standard consumer clothes dryers, which account for 
approximately 98 percent of U.S. shipments, requiring efficiency levels 
above the levels required by TSL 3 result in a large percentage of 
consumers experiencing a net LCC cost, in addition to significant 
manufacturer impacts and reductions in INPV. Additionally, for consumer 
clothes dryers, nearly all manufacturers offer products that can meet 
TSL 3 across both electric and gas consumer clothes dryers. In 
addition, DOE is proposing to adopt TSL 3, which corresponds to the 
current ENERGY STAR levels for electric standard and ventless compact 
electric (240V), which have significant market share and manufacturer 
support due to their promotion over the past couple of years as a 
voluntary energy-efficiency program. The adoption of standards, if 
finalized as proposed, at this TSL may encourage ENERGY STAR to further 
consider more-efficient levels for dryers in the year leadings up to 
the compliance of date of the standard, which would in turn likely spur 
additional market introductions of consumer clothes dryers with heat 
pump technology, foster maturation of the technology and downward price 
trends, and further support differentiation within the dryer market for 
energy efficient products. For electric and vented gas standard 
consumer clothes dryers, TSL 3 is comprised of EL 4 and EL 3, 
respectively, resulting in higher LCC savings, a significant reduction 
in the number of consumers experiencing a net cost, a lower maximum 
decrease in INPV, and lower conversion costs to the point where DOE has 
tentatively concluded they are economically justified, as discussed for 
TSL 3 in the preceding paragraphs.
    Therefore, based on the previous considerations, DOE proposes to 
adopt the energy conservation standards for consumer clothes dryers at 
TSL 3. The proposed amended energy conservation standards for consumer 
clothes dryers, which are expressed as CEFD2, are shown in 
Table V.45.

 Table V.45--Proposed Amended Energy Conservation Standards for Consumer
                             Clothes Dryers
------------------------------------------------------------------------
                                                          CEFD2 (lb/kWh)
                      Product class
------------------------------------------------------------------------
Electric, Standard (4.4 cubic feet (``ft\3\'') or                   3.93
 greater capacity)......................................
Electric, Compact (120 volts (``V'')) (less than 4.4                4.33
 ft\3\ capacity)........................................
Vented Electric, Compact (240V) (less than 4.4 ft\3\                3.57
 capacity)..............................................
Ventless Electric, Compact (240V) (less than 4.4 ft\3\              2.68
 capacity)..............................................
Ventless Electric, Combination Washer-Dryer.............            2.33
Vented Gas, Standard (4.4 ft\3\ or greater capacity)....            3.48
Vented Gas, Compact (less than 4.4 ft\3\ capacity)......            2.02
------------------------------------------------------------------------

2. Annualized Benefits and Costs of the Proposed Standards
    The benefits and costs of the proposed standards can also be 
expressed in terms of annualized values. The annualized net benefit is 
(1) the annualized national economic value (expressed in 2020$) of the 
benefits from operating products that meet the proposed standards 
(consisting primarily of operating cost savings from using less energy, 
minus increases in product purchase costs, and (2) the annualized 
monetary value of the benefits of GHG and NOX emission 
reductions.
    Table V.46 shows the annualized values for consumer clothes dryers 
under TSL 3, expressed in 2020$. The

[[Page 51803]]

results under the primary estimate are as follows.
    Using a 7-percent discount rate for consumer benefits and costs and 
NOX and SO2 reduction benefits, and a 3-percent 
discount rate case for GHG social costs, the estimated cost of the 
proposed standards for consumer clothes dryers is $85.7 million per 
year in increased equipment costs, while the estimated annual benefits 
are $1,111 million from reduced equipment operating costs, $320 million 
from GHG reductions, and $406 million from reduced NOX and 
SO2 emissions. In this case, the net benefit amounts to 
$1,752 million per year.
    Using a 3-percent discount rate for all benefits and costs, the 
estimated cost of the proposed standards for consumer clothes dryers is 
$80.7 million per year in increased equipment costs, while the 
estimated annual benefits are $1,313 million in reduced operating 
costs, $320 million from GHG reductions, and $541 million from reduced 
NOX and SO2 emissions. In this case, the net 
benefit amounts to $2,094 million per year.

   Table V.46--Annualized Monetized Benefits and Costs of Proposed Energy Conservation Standards for Consumer
                                                 Clothes Dryers
                                                     [TSL 3]
----------------------------------------------------------------------------------------------------------------
                                                                                Million 2020$/year
                                                                 -----------------------------------------------
                                                                                     Low-net-        High-net-
                                                                      Primary        benefits        benefits
                                                                     estimate        estimate        estimate
----------------------------------------------------------------------------------------------------------------
                                                3% discount rate
----------------------------------------------------------------------------------------------------------------
Consumer Operating Cost Savings.................................           1,313           1,227           1,403
Climate Benefits *..............................................             320             311             327
Health Benefits **..............................................             541             526             551
Total Benefits [dagger].........................................           2,174           2,065           2,280
Consumer Incremental Product Costs [Dagger].....................            80.7            80.5            76.6
Net Benefits....................................................           2,094           1,984           2,204
----------------------------------------------------------------------------------------------------------------
                                                7% discount rate
----------------------------------------------------------------------------------------------------------------
Consumer Operating Cost Savings.................................           1,111           1,050           1,178
Climate Benefits *..............................................             320             311             327
Health Benefits **..............................................             406             395             413
Total Benefits [dagger].........................................           1,837           1,757           1,917
Consumer Incremental Product Costs [Dagger].....................            85.7            85.3            82.4
Net Benefits....................................................           1,752           1,671           1,835
----------------------------------------------------------------------------------------------------------------
Note: This table presents the costs and benefits associated with consumer clothes dryers shipped in 2027-2056.
  These results include benefits to consumers which accrue after 2056 from the products shipped in 2027-2056.
* Climate benefits are calculated using four different estimates of the social cost of carbon (SC-CO2), methane
  (SC-CH4), and nitrous oxide (SC-N2O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates;
  95th percentile at 3 percent discount rate). Together these represent the global social cost of greenhouse
  gases (SC-GHG). For presentational purposes of this table, the climate benefits associated with the average SC-
  GHG at a 3 percent discount rate are shown, but the Department does not have a single central SC-GHG point
  estimate. See section. IV.L of this document for more details. On March 16, 2022, the Fifth Circuit Court of
  Appeals (No. 22-30087) granted the Federal government's emergency motion for stay pending appeal of the
  February 11, 2022, preliminary injunction issued in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a
  result of the Fifth Circuit's order, the preliminary injunction is no longer in effect, pending resolution of
  the Federal government's appeal of that injunction or a further court order. Among other things, the
  preliminary injunction enjoined the defendants in that case from ``adopting, employing, treating as binding,
  or relying upon'' the interim estimates of the social cost of greenhouse gases--which were issued by the
  Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 2021--to monetize the
  benefits of reducing greenhouse gas emissions. As reflected in this rule, DOE has reverted to its approach
  prior to the injunction and presents monetized greenhouse gas abatement benefits where appropriate and
  permissible under law.
** Health benefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only monetizing
  (for SO2 and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits, but will
  continue to assess the ability to monetize other effects such as health benefits from reductions in direct
  PM2.5 emissions. The health benefits are presented at real discount rates of 3 and 7 percent. See section IV.L
  of this document for more details.
[dagger] Total benefits for both the 3-percent and 7-percent cases are presented using the average SC-GHG with 3-
  percent discount rate, but the Department does not have a single central SC-GHG point estimate. DOE emphasizes
  the importance and value of considering the benefits calculated using all four SC-GHG estimates.
[Dagger] Costs include incremental equipment costs as well as installation costs.

D. Reporting, Certification, and Sampling Plan

    In addition to reporting cycle time, the California IOUs also 
encouraged DOE to incorporate refrigerant type and charge quantity into 
the reporting requirement for any products that use heat pump 
technology, stating that the regulatory landscape around refrigerant 
types and charge quantity has been changing rapidly and disclosure of 
these two parameters would be useful for compliance with those 
requirements. The California IOUs also stated that ENERGY STAR 
currently allows manufacturers to voluntarily disclose the refrigerant 
type. (California IOUs, No. 26 at p. 6)
    DOE will continue to monitor the regulatory landscape around 
refrigerants in the consumer clothes dryer industry, and if DOE 
determines that the additional reporting information would be useful, 
DOE may consider requiring that information in a future separate 
rulemaking that would address any necessary amendments to reporting 
requirements for all covered products and equipment.
    Manufacturers, including importers, must use product-specific 
certification templates to certify compliance to DOE. For consumer 
clothes dryers, the certification template reflects the general 
certification requirements specified at 10 CFR 429.12 and the product-
specific requirements specified at 10 CFR 429.21. As discussed in the

[[Page 51804]]

previous paragraphs, DOE is not proposing to amend the product-specific 
certification requirements for consumer clothes dryers.

VI. Procedural Issues and Regulatory Review

A. Review Under Executive Orders 12866 and 13563

    Executive Order (``E.O.'') 12866, ``Regulatory Planning and 
Review,'' as supplemented and reaffirmed by E.O. 13563, ``Improving 
Regulation and Regulatory Review, 76 FR 3821 (Jan. 21, 2011), requires 
agencies, to the extent permitted by law, 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 E.O. 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. For the reasons stated in the preamble, this 
proposed regulatory action is consistent with these principles.
    Section 6(a) of E.O. 12866 also requires agencies to submit 
``significant regulatory actions'' to the OIRA for review. OIRA has 
determined that this proposed regulatory action constitutes an 
economically significant regulatory action under section 3(f) of E.O. 
12866. Accordingly, pursuant to section 6(a)(3)(C) of E.O. 12866, DOE 
has provided to OIRA an assessment, including the underlying analysis, 
of benefits and costs anticipated from the proposed/final regulatory 
action, together with, to the extent feasible, a quantification of 
those costs; and an assessment, including the underlying analysis, of 
costs and benefits of potentially effective and reasonably feasible 
alternatives to the planned regulation, and an explanation why the 
planned regulatory action is preferable to the identified potential 
alternatives. These assessments are summarized in this preamble and 
further detail can be found in the technical support document for this 
rulemaking.

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 E.O. 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 7990. DOE has made its 
procedures and policies available on the Office of the General 
Counsel's website (energy.gov/gc/office-general-counsel). DOE has not 
prepared an IRFA for the products that are the subject of this proposed 
rulemaking.
    DOE reviewed this proposed rule under the provisions of the 
Regulatory Flexibility Act and the procedures and policies published on 
February 19, 2003. DOE certifies that the proposed rule, if adopted, 
would not have significant economic impact on a substantial number of 
small entities. The factual basis of this certification is set forth in 
the following paragraphs.
    In accordance with EPCA, DOE is publishing this NOPR as part of the 
legislated 6-year review of energy conservation standards for consumer 
clothes dryers. (42 U.S.C. 6295(m)) The most recent standards 
rulemaking for consumer clothes dryers was promulgated on April 21, 
2011. Specifically, DOE published a direct final rule (the ``2011 
Direct Final Rule'') amending the energy conservation standard for 
consumer clothes dryers manufactured on and after January 1, 2015. 76 
FR 22454 (Apr. 21, 2011). Pursuant to EPCA, any new or amended energy 
conservation standard must be designed to achieve the maximum 
improvement in energy efficiency that DOE determines is technologically 
feasible and economically justified. (42 U.S.C. 6295(o)(2)(A)) 
Furthermore, the new or amended standard must result in a significant 
conservation of energy. (42 U.S.C. 6295(o)(3)(B)) EPCA also provides 
that not later than 6 years after issuance of any final rule 
establishing or amending a standard, DOE must publish either a notice 
of determination that standards for the product do not need to be 
amended, or a NOPR including new proposed energy conservation standards 
(proceeding to a final rule, as appropriate). (42 U.S.C. 6295(m))
    For manufacturers of consumer clothes dryers, 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. (See 13 CFR part 121.) The 
size standards are listed by North American Industry Classification 
System (``NAICS'') code and industry description and are available at 
www.sba.gov/document/support-table-size-standards. Manufacturing of 
consumer clothes dryers is classified under NAICS 335220, ``Major 
Household Appliance Manufacturing.'' The SBA sets a threshold of 1,500 
employees or fewer for an entity to be considered as a small business 
for this category.
    To estimate the number of companies that could be small business 
manufacturers of products covered by this rulemaking, DOE conducted a 
market survey using public information and subscription-based company 
reports to identify potential small business manufacturers. DOE 
reviewed the CCMS database,\89\ California Energy Commission's 
Modernized Appliance Efficiency Database System (``MAEDbS''),\90\ the 
ENERGY STAR Product Finder dataset,\91\ individual company websites, 
import/export logs, and product specifications to create a list of 
companies that manufacture, produce, import, or private label the 
products covered by this rulemaking.

[[Page 51805]]

DOE relied on public information and market research tools (e.g., 
reports from Dun and Bradstreet \92\) to determine company structure, 
location, headcount, and annual revenue. DOE screened out companies 
that do not manufacture the products covered by this rulemaking, do not 
meet the SBA's definition of a ``small business,'' or are foreign-owned 
and operated. DOE also asked stakeholders and industry representatives 
if they were aware of any small manufacturers during manufacturer 
interviews and through requests for comment.
---------------------------------------------------------------------------

    \89\ U.S. Department of Energy's Compliance Certification 
Database is available at regulations.doe.gov/certification-data 
(last accessed October 8, 2021).
    \90\ California Energy Commission's Modernized Appliance 
Efficiency Database System is available at 
cacertappliances.energy.ca.gov/Pages/ApplianceSearch.aspx (last 
accessed October 8, 2021).
    \91\ ENERGY STAR Product Finder is available at energystar.gov/productfinder/ (last accessed October 8, 2021).
    \92\ The Dun & Bradstreet subscription login is available at 
app.dnbhoovers.com.
---------------------------------------------------------------------------

    DOE identified 15 OEMs of the covered product. Of these 15 OEMs, 
DOE determined none of them qualify as a domestic ``small business 
manufacturer'' of consumer clothes dryers. Given the lack of small 
domestic OEMs with a direct compliance burden, DOE concludes that the 
proposed rule would not have ``a significant impact on a substantial 
number of small entities.'' DOE requests comment on this certification 
conclusion.
    DOE will transmit the certification and supporting statement of 
factual basis to the Chief Counsel for Advocacy of the Small Business 
Administration for review under 5 U.S.C. 605(b).

C. Review Under the Paperwork Reduction Act

    Manufacturers of consumer clothes dryers must certify to DOE that 
their products comply with any applicable energy conservation 
standards. In certifying compliance, manufacturers must test their 
products according to the DOE test procedures for consumer clothes 
dryers, 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 
equipment, including consumer clothes dryers. 76 FR 12422 (Mar. 7, 
2011); 80 FR 5099 (Jan. 30, 2015). 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.
    In this rulemaking, DOE proposes standards expressed as the 
combined energy factor, determined in accordance with the appendix D2 
test procedure (CEFD2). Were this NOPR to be finalized as 
proposed, manufacturers of consumer clothes dryers would certify to DOE 
using the certification template associated with appendix D2 once the 
standard goes into effect. The public reporting burden under appendix 
D2 is not substantially different than the public reporting burden 
under appendix D1 and is already required for ENERGY STAR 
certification. Adopting standards based on the CEFD2 metric 
would not cause any measurable change in reporting burden or hours to 
manufacturers of consumer clothes dryers. Thus, DOE is not proposing 
any changes to its information collection requirements as these are 
already accounted for by DOE's existing regulations. DOE seeks comment 
on DOE's estimated burden for certifying compliance under appendix D2 
should amended standards be finalized.
    Public reporting burden for the certification is estimated to 
average 35 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

    DOE is analyzing this proposed regulation in accordance with the 
National Environmental Policy Act of 1969 (``NEPA'') and DOE's NEPA 
implementing regulations (10 CFR part 1021). DOE's regulations include 
a categorical exclusion for rulemakings that establish energy 
conservation standards for consumer products or industrial equipment. 
10 CFR part 1021, subpart D, appendix B5.1. DOE anticipates that this 
rulemaking qualifies for categorical exclusion B5.1 because it is a 
rulemaking that establishes energy conservation standards for consumer 
products or industrial equipment, none of the exceptions identified in 
categorical exclusion B5.1(b) apply, no extraordinary circumstances 
exist that require further environmental analysis, and it otherwise 
meets the requirements for application of a categorical exclusion. See 
10 CFR 1021.410. DOE will complete its NEPA review before issuing the 
final rule.

E. Review Under Executive Order 13132

    E.O. 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 13735. DOE has examined this proposed rule and has 
tentatively determined that it would not have a substantial direct 
effect on the States, on the relationship between the national 
government and the States, or on the distribution of power and 
responsibilities among the various levels of government. EPCA governs 
and prescribes Federal preemption of State regulations as to energy 
conservation for the products that are the subject of this 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) 
Therefore, 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 E.O. 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, (3) provide a 
clear legal standard for affected conduct rather than a general 
standard, and (4) promote simplification and burden reduction. 61 FR 
4729 (Feb. 7, 1996). Regarding the review required by section 3(a), 
section 3(b) of E.O. 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

[[Page 51806]]

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 E.O. 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, section 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 them. On March 18, 1997, DOE 
published a statement of policy on its process for intergovernmental 
consultation under UMRA. 62 FR 12820. DOE's policy statement is also 
available at energy.gov/sites/prod/files/gcprod/documents/umra_97.pdf.
    Although this proposed rule does not contain a Federal 
intergovernmental mandate, it may require expenditures of $100 million 
or more in any one year by the private sector. Such expenditures may 
include: (1) investment in research and development and in capital 
expenditures by consumer clothes dryer manufacturers in the years 
between the final rule and the compliance date for the new standards 
and (2) incremental additional expenditures by consumers to purchase 
higher-efficiency consumer clothes dryers, 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 TSD for this 
proposed rule respond to those requirements.
    Under section 205 of UMRA, the Department 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(m) 
this proposed rule would establish amended energy conservation 
standards for consumer clothes dryers that are designed to achieve the 
maximum improvement in energy efficiency that DOE has determined to be 
both technologically feasible and economically justified, as required 
by 42 U.S.C. 6295(o)(2)(A) and 42 U.S.C. 6295(o)(3)(B). A full 
discussion of the alternatives considered by DOE is presented in 
chapter 17 of the TSD for this 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

    Pursuant to E.O. 12630, ``Governmental Actions and Interference 
with Constitutionally Protected Property Rights,'' 53 FR 8859 (Mar. 15, 
1988), DOE has determined that this proposed rule 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 information 
quality 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). Pursuant to OMB Memorandum M-19-15, Improving 
Implementation of the Information Quality Act (April 24, 2019), DOE 
published updated guidelines which are available at www.energy.gov/sites/prod/files/2019/12/f70/DOE%20Final%20Updated%20IQA%20Guidelines%20Dec%202019.pdf. DOE has 
reviewed this 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

    E.O. 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 action and their expected 
benefits on energy supply, distribution, and use.
    DOE has tentatively concluded that this regulatory action, which 
proposes amended energy conservation standards for consumer clothes 
dryers, 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 this proposed rule.

[[Page 51807]]

L. Information Quality

    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 2664, 2667.
    In response to OMB's Bulletin, DOE conducted formal peer reviews of 
the energy conservation standards development process and the analyses 
that are typically used and has prepared a report describing that peer 
review.\93\ 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. 
DOE has determined that the peer-reviewed analytical process continues 
to reflect current practice, and the Department followed that process 
for developing energy conservation standards in the case of the present 
rulemaking.
---------------------------------------------------------------------------

    \93\ The 2007 ``Energy Conservation Standards Rulemaking Peer 
Review Report'' is available at the following website: energy.gov/eere/buildings/downloads/energy-conservation-standards-rulemaking-peer-review-report-0 (last accessed November 2021).
---------------------------------------------------------------------------

VII. Public Participation

A. Participation in the Webinar

    The time and date of the webinar are listed in the DATES section at 
the beginning of this document. Webinar registration information, 
participant instructions, and information about the capabilities 
available to webinar participants will be published on DOE's website: 
www1.eere.energy.gov/buildings/appliance_standards/standards.aspx?productid=50&action=viewlive. 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 webinar. 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 
document. The request and advance copy of statements must be received 
at least one week before the public meeting and are to be emailed. 
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 webinar 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 webinar. There shall not be discussion of proprietary information, 
costs or prices, market share, or other commercial matters regulated by 
U.S. anti-trust laws. After the webinar, 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 webinar will be conducted in an informal, conference style. DOE 
will present a general overview of the topics addressed in this 
rulemaking, 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. 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 webinar 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 
previous procedures that may be needed for the proper conduct of the 
webinar.
    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 document and will be accessible on the DOE website. 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 document.
    Submitting comments via www.regulations.gov. The 
www.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 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 www.regulations.gov information for which 
disclosure is restricted by statute, such as trade secrets and 
commercial or financial information (hereinafter referred to as

[[Page 51808]]

Confidential Business Information (``CBI'')). Comments submitted 
through www.regulations.gov cannot be claimed as CBI. Comments received 
through the website will waive any CBI claims for the information 
submitted. For information on submitting CBI, see the Confidential 
Business Information section.
    DOE processes submissions made through www.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 www.regulations.gov 
provides after you have successfully uploaded your comment.
    Submitting comments via email. Comments and documents submitted via 
email also will be posted to www.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. No telefacsimiles (``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. Pursuant 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 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. DOE will make 
its own determination about the confidential status of the information 
and treat it according to its determination.
    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) DOE seeks comment on the method for estimating manufacturing 
production costs.
    (2) DOE seeks comment on additional information regarding 
potential classification errors within the CCMS database. See 
section IV.A.1 of this document.
    (3) DOE requests comment on any potential impacts that different 
technology options, including any that may impact cycle times, have 
on fabric care. See section IV.B.1 of this document.
    (4) DOE seeks comment on the baseline and incremental efficiency 
levels used in the NOPR engineering analysis. See section IV.C.1 of 
this document.
    (5) DOE seeks comment on the baseline and incremental MPCs from 
the NOPR engineering analysis, as well as any data on the impact of 
supply chain challenges that could better inform the cost analysis. 
See section IV.C.3 of this document.
    (6) DOE seeks comment on product cost trends over time of heat 
pump technology. See section IV.F.1 of this document.
    (7) DOE requests information and data on repair cost for 
replacing an electromechanical and electronic control panel. See 
section IV.F.5 of this document.
    (8) DOE seeks input from interested parties on characterizing 
maintenance and repair costs for more-efficient consumer clothes 
dryers. See section IV.F.5 of this document.
    (9) DOE requests comments, information, and data on the no-new-
standards case efficiency distribution of consumer clothes dryers. 
See section IV.F.8 of this document.
    (10) DOE requests comment on its methodology for estimating 
shipments. DOE also requests comment on its approach to estimate the 
market share for each consumer clothes dryer product class. See 
section IV.G of this document.
    (11) DOE requests comment on any new information or data that 
points to an impact on usage due to a change in cycle times (See 
section IV.H.2 of this document) or changes to cycle times as a 
result of the proposed standard.

    Additionally, DOE welcomes comments on other issues relevant to the 
conduct of this proposed rulemaking that may not specifically be 
identified in this document.

VIII. Approval of the Office of the Secretary

    The Secretary of Energy has approved publication of this notice of 
proposed rulemaking.

List of Subjects in 10 CFR Part 430

    Administrative practice and procedure, Confidential business 
information, Energy conservation, Household appliances, Imports, 
Intergovernmental relations, Small businesses.

Signing Authority

    This document of the Department of Energy was signed on August 14, 
2022, by Kelly J. Speakes-Backman, Principal Deputy Assistant Secretary 
for Energy Efficiency and Renewable Energy, pursuant to delegated 
authority from the Secretary of Energy. That document with the original 
signature and date is maintained by DOE. For administrative purposes 
only, and in compliance with requirements of the Office of the Federal 
Register, the undersigned DOE Federal Register Liaison Officer has been 
authorized to sign and submit the document in electronic format for 
publication, as an official document of the Department of Energy. This 
administrative process in no way alters the legal effect of this 
document upon publication in the Federal Register.

    Signed in Washington, DC, on August 16, 2022.
Treena V. Garrett,
Federal Register Liaison Officer, U.S. Department of Energy.

    For the reasons set forth in the preamble, DOE proposes to amend 
part 430 of chapter II, subchapter D, of title 10 of the Code of 
Federal Regulations, as set forth below:

PART 430--ENERGY CONSERVATION PROGRAM FOR CONSUMER PRODUCTS

0
1. The authority citation for part 430 continues to read as follows:

    Authority:  42 U.S.C. 6291-6309; 28 U.S.C. 2461 note.

0
2. Amend Sec.  430.32 by revising the introductory text to paragraph 
(h)(3) and adding paragraph (h)(4) to read as follows:


Sec.  430.32  Energy and water conservation standards and their 
compliance dates.

* * * * *
    (h) * * *
    (3) Clothes dryers manufactured on or after January 1, 2015 and 
before [date 3

[[Page 51809]]

years after publication of a final rule], shall have a combined energy 
factor no less than:
* * * * *
    (4) Clothes dryers manufactured on or after [date 3 years after 
publication of a final rule], shall have a combined energy factor, 
determined in accordance with Appendix D2 of this subpart, no less 
than:

------------------------------------------------------------------------
                                                          CEFD2 (lb/kWh)
                      Product class
------------------------------------------------------------------------
Electric, Standard (4.4 ft\3\ or greater capacity)......            3.93
Electric, Compact (120V) (less than 4.4 ft\3\ capacity).            4.33
Vented Electric, Compact (240V) (less than 4.4 ft\3\                3.57
 capacity)..............................................
Vented Gas, Standard (4.4 ft\3\ or greater capacity)....            3.48
Vented Gas, Compact (less than 4.4 ft\3\ capacity)......            2.02
Ventless Electric, Compact (240V) (less than 4.4 ft\3\              2.68
 capacity)..............................................
Ventless Electric, Combination Washer-Dryer.............            2.33
------------------------------------------------------------------------

* * * * *

[FR Doc. 2022-17900 Filed 8-22-22; 8:45 am]
BILLING CODE 6450-01-P

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