Energy Conservation Program: Energy Conservation Standards for Residential Clothes Washers, 13520-13621 [2023-03862]

Download as PDF 13520 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules DEPARTMENT OF ENERGY 10 CFR Part 430 [EERE–2017–BT–STD–0014] RIN 1904–AD98 Energy Conservation Program: Energy Conservation Standards for Residential Clothes Washers 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 residential clothes washers (‘‘RCWs’’). EPCA also requires the U.S. Department of Energy (‘‘DOE’’) to periodically determine whether morestringent, 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 RCWs, 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 Tuesday, March 28, 2023, from 1:00 p.m. to 4:00 p.m. See section VII of this document, ‘‘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 May 2, 2023. 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 April 3, 2023. ADDRESSES: Interested persons are encouraged to submit comments using the Federal eRulemaking Portal at www.regulations.gov, under docket number EERE–2017–BT–STD–0014. Follow the instructions for submitting comments. Alternatively, interested persons may submit comments, identified by docket number EERE– 2017–BT–STD–0014, by any of the following methods: ddrumheller on DSK120RN23PROD with PROPOSALS2 SUMMARY: VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 Email: ConsumerClothes Washer2017STD0014@ee.doe.gov. Include the docket number EERE–2017– BT–STD–0014 in the subject line of the message. Postal Mail: Appliance and Equipment Standards Program, U.S. Department of Energy, Building Technologies Office, Mailstop EE–5B, 1000 Independence Avenue SW, Washington, DC 20585–0121. Telephone: (202) 287–1445. If possible, please submit all items on a compact disc (‘‘CD’’), in which case it is not necessary to include printed copies. Hand Delivery/Courier: Appliance and Equipment Standards Program, U.S. Department of Energy, Building Technologies Office, 950 L’Enfant Plaza SW, 6th Floor, Washington, DC 20024. Telephone: (202) 287–1445. If possible, please submit all items on a CD, in which case it is not necessary to include printed copies. No telefacsimiles (‘‘faxes’’) will be accepted. For detailed instructions on submitting comments and additional information on this process, see section VII 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– 2017–BT–STD–0014. The docket web page contains instructions on how to access all documents, including public comments, in the docket. See section VII of this document for information on how to submit comments through www.regulations.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 proposed rule. FOR FURTHER INFORMATION CONTACT: Dr. Carl Shapiro, U.S. Department of Energy, Office of Energy Efficiency and PO 00000 Frm 00002 Fmt 4701 Sfmt 4702 Renewable Energy, Building Technologies Office, EE–5B, 1000 Independence Avenue SW, Washington, DC 20585–0121. Telephone: (202) 287– 5649. Email: ApplianceStandardsQuestions@ ee.doe.gov. Ms. Melanie Lampton, U.S. Department of Energy, Office of the General Counsel, GC–33, 1000 Independence Avenue SW, Washington, DC 20585–0121. Telephone: (240) 751– 5157. Email: Melanie.Lampton@ hq.doe.gov. 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. History of Standards Rulemaking for Residential Clothes Washers C. Deviation From Appendix A III. General Discussion A. General Comments B. Scope of Coverage C. Test Procedure 1. History of Appendix J 2. Metrics 3. Test Cloth 4. Other Test Procedure-Related Comments D. Technological Feasibility 1. General 2. Maximum Technologically Feasible Levels E. Energy Savings 1. Determination of Savings 2. Significance of Savings F. 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. Product Classes 2. Technology Options B. Screening Analysis 1. Screened-Out Technologies 2. Remaining Technologies E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules C. Engineering Analysis 1. Preliminary Analysis Prediction Tool 2. Efficiency Analysis a. Baseline Efficiency Levels b. Higher Efficiency Levels c. Semi-Automatic 3. Cost Analysis 4. Cost-Efficiency Results 5. Translations a. Preliminary Analysis Approach b. NODA Approach c. NOPR Approach d. Alternative Approaches D. Markups Analysis E. Energy and Water Use Analysis 1. Number of Annual Cycles 2. Rebound Effect 3. Water Heating Energy Use F. Life-Cycle Cost and Payback Period Analysis 1. Consumer Product Cost 2. Installation Cost 3. Annual Energy and Water Consumption 4. Energy and Water Prices a. Energy Prices b. Water and Wastewater Prices 5. Repair and Maintenance Costs 6. Product Lifetime 7. Discount Rates 8. Energy Efficiency Distribution in the NoNew-Standards Case 9. Payback Period Analysis 10. Other Issues G. Shipments Analysis H. National Impact Analysis 1. Product Efficiency Trends 2. National Energy and Water Savings 3. Net Present Value Analysis I. Consumer Subgroup Analysis 1. Low-Income Households 2. Senior-Only Households 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. Product Classes b. Ability To Serve Certain Consumer Segments c. Supply Chain Constraints 4. Discussion of MIA Comments K. Emissions Analysis 1. Air Quality Regulations Incorporated in DOE’s Analysis L. Monetizing Emissions Impacts 1. Monetization of Greenhouse Gas Emissions a. Social Cost of Carbon b. Social Cost of Methane and Nitrous Oxide 2. Monetization of Other 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 VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 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 and Water Savings b. Net Present Value of Consumer Costs and Benefits c. Indirect Impacts on Employment 4. Impact on Utility or Performance of Products a. Performance Characteristics b. Availability of ‘‘Traditional’’ Agitators c. Water Levels d. Availability of Portable Products e. Conclusion 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 Residential Clothes Washer 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 1. Description of Reasons Why Action Is Being Considered 2. Objectives of, and Legal Basis for, Rule 3. Description on Estimated Number of Small Entities Regulated 4. Description and Estimate of Compliance Requirements Including Differences in Cost, if Any, for Different Groups of Small Entities 5. Duplication, Overlap, and Conflict With Other Rules and Regulations 6. Significant Alternatives to the Rule C. Review Under the Paperwork Reduction Act D. Review Under the National Environmental Policy Act of 1969 E. Review Under Executive Order 13132 F. Review Under Executive Order 12988 G. Review Under the Unfunded Mandates Reform Act of 1995 H. Review Under the Treasury and General Government Appropriations Act, 1999 I. Review Under Executive Order 12630 J. Review Under the Treasury and General Government Appropriations Act, 2001 K. Review Under Executive Order 13211 L. Information Quality VII. Public Participation A. Participation in the Webinar B. Procedure for Submitting Prepared General Statements for Distribution C. Conduct of the Webinar 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 The Energy Policy and Conservation Act, Public Law 94–163, as amended PO 00000 Frm 00003 Fmt 4701 Sfmt 4702 13521 (‘‘EPCA’’),1 authorizes DOE to regulate the energy efficiency of a number of consumer products and certain industrial equipment. (42 U.S.C. 6291– 6317) Title III, Part B of EPCA 2 established the Energy Conservation Program for Consumer Products Other Than Automobiles. (42 U.S.C. 6291– 6309) These products include consumer (residential) 3 clothes washers (‘‘RCWs’’), 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 notice of proposed rulemaking 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 RCWs. The proposed standards, which are expressed in terms of energy efficiency ratio (‘‘EER’’) measured in pounds per kilowatt-hour per cycle (‘‘lb/ kWh/cycle’’) and water efficiency ratio (‘‘WER’’) measured in pounds per gallon per cycle (‘‘lb/gal/cycle’’) as measured using the test procedure at title 10 of the Code of Federal Regulations (‘‘CFR’’), part 430, subpart B, appendix J (‘‘appendix J’’), are shown in Table I.1. These proposed standards, if adopted, would apply to all RCWs listed in Table I.1 manufactured in, or imported into, the United States starting on the date 3 years after the publication in the Federal Register of the final rule for this rulemaking. As shown in Table I.1 and discussed further in IV.A.1 of this document, DOE proposes standards for separate RCW product classes that are 1 All references to EPCA in this document refer to the statute as amended through the Energy Act of 2020, Public Law 116–260 (Dec. 27, 2020), which reflect the last statutory amendments that impact Parts A and A–1 of EPCA. 2 For editorial reasons, upon codification in the U.S. Code, Part B was redesignated Part A. 3 DOE uses the ‘‘residential’’ nomenclature and ‘‘RCW’’ abbreviation for consumer clothes washers in order to distinguish from the ‘‘CCW’’ abbreviation used for commercial clothes washers, which are also regulated equipment under EPCA. E:\FR\FM\03MRP2.SGM 03MRP2 13522 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules defined based on axis of loading (i.e., top-loading or front-loading), clothes container capacity (measured in cubic feet (‘‘ft3’’)), and whether the product is automatic or semi-automatic. TABLE I.1—PROPOSED ENERGY CONSERVATION STANDARDS FOR RESIDENTIAL CLOTHES WASHERS Minimum energy efficiency ratio (lb/kWh/cycle) Product class Semi-Automatic Clothes Washers ............................................................................................................... Automatic Clothes Washers: Top-Loading, Ultra-Compact (less than 1.6 ft3 capacity) ..................................................................... Top-Loading, Standard-Size (1.6 ft3 or greater capacity) .................................................................... Front-Loading, Compact (less than 3.0 ft3 capacity) ........................................................................... Front-Loading, Standard-Size (3.0 ft3 or greater capacity) .................................................................. A. Benefits and Costs to Consumers Table I.2 presents DOE’s evaluation of the economic impacts of the proposed standards, represented by trial standard level (‘‘TSL’’) 4, on consumers of RCWs, as measured by the average life-cycle cost (‘‘LCC’’) savings and the simple payback period (‘‘PBP’’).4 The average LCC savings are positive for all product Minimum water efficiency ratio (lb/gal/cycle) 2.12 0.27 3.79 4.78 5.02 5.73 0.29 0.63 0.71 0.77 classes, and the PBP is less than the average lifetime of RCWs, which is estimated to be 13.7 years (see section IV.F.6 of this document). TABLE I.2—IMPACTS OF PROPOSED ENERGY CONSERVATION STANDARDS ON CONSUMERS OF RESIDENTIAL CLOTHES WASHERS Average LCC savings (2021$) Product class Semi-Automatic Clothes Washers ............................................................................................................... Automatic Clothes Washers: Top-Loading, Ultra-Compact (less than 1.6 ft3 capacity) * ................................................................... Top-Loading, Standard-Size (1.6 ft3 or greater capacity) .................................................................... Front-Loading, Compact (less than 3.0 ft3 capacity) ........................................................................... Front-Loading, Standard-Size (3.0 ft3 or greater capacity) .................................................................. Simple payback period (years) $329 0.3 n.a. 134 7 19 n.a. 5.9 9.1 3.2 * The entry ‘‘n.a.’’ means not applicable because the standard at the proposed TSL is the baseline. 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 9.3 percent, DOE estimates that the INPV for manufacturers of RCWs in the case without amended standards is $1,738.3 million in 2021$. Under the proposed standards, the change in INPV is estimated to range from –30.5 percent to –20.8 percent, which is approximately ¥$530.2 million to ¥$361.6 million. In order to bring products into compliance with amended standards, it is estimated DOE’s analyses indicate that the proposed energy conservation standards for RCWs would save a significant amount of energy and water. Relative to the case without amended standards, the lifetime energy and water savings for RCWs purchased in the 30-year period that begins in the anticipated year of compliance with the standards (2027– 2056) amount to 1.45 quadrillion British thermal units (‘‘Btu’’), or quads of energy and 2.53 trillion gallons of water, respectively.6 The cumulative net present value (‘‘NPV’’) of total consumer benefits of the proposed standards for RCWs ranges from $5.14 billion (at a 7-percent discount rate) to $14.52 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 and installation costs for RCWs purchased in 2027–2056. In addition, the proposed standards for RCWs 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 53.21 million metric tons (‘‘Mt’’) 7 of carbon dioxide (‘‘CO2’’), 19.93 thousand tons of sulfur dioxide (‘‘SO2’’), 92.39 thousand tons of nitrogen 4 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). 5 All monetary values in this document are expressed in 2021 dollars. 6 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.1 of this document. 7 A metric ton is equivalent to 1.1 short tons. Results for emissions other than CO2 are presented in short tons. DOE’s analysis of the impacts of the proposed standards on consumers is described in section IV.F of this document. ddrumheller on DSK120RN23PROD with PROPOSALS2 B. Impact on Manufacturers VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 that the industry would incur total conversion costs of $690.8 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 5 PO 00000 Frm 00004 Fmt 4701 Sfmt 4702 E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules oxides (‘‘NOX’’), 411.43 thousand tons of methane (‘‘CH4’’), 0.48 thousand tons of nitrous oxide (‘‘N2O’’), and 0.13 tons of mercury (‘‘Hg’’).8 DOE estimates the value of climate benefits from a reduction in greenhouse gases (‘‘GHG’’) 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 GHG (‘‘SC– GHG’’).9 DOE used interim SC–GHG values developed by an Interagency Working Group on the Social Cost of Greenhouse Gases (‘‘IWG’’).10 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 $2.71 billion. 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 sets of SC–GHG estimates. DOE estimated the monetary health benefits of SO2 and NOX emissions reductions using benefit per ton estimates from the scientific literature, as discussed in section IV.L of this document. DOE estimated the present value of the health benefits would be $1.91 billion using a 7-percent discount rate, and $4.57 billion using a 3-percent 13523 discount rate.11 DOE is currently only monetizing (for SO2 and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits, but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM2.5 emissions. Table I.3 summarizes the economic benefits and costs expected to result from the proposed standards for RCWs. There are other important unquantified effects, including certain unquantified climate benefits, unquantified public health benefits from the reduction of toxic air pollutants and other emissions, unquantified energy security benefits, and distributional effects, among others. TABLE I.3—SUMMARY OF MONETIZED ECONOMIC BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR RESIDENTIAL CLOTHES WASHERS [TSL 4] Billion 2021$ 3% discount rate Consumer Operating Cost Savings ............................................................................................................................................... Climate Benefits * ........................................................................................................................................................................... Health Benefits ** ........................................................................................................................................................................... 27.83 2.71 4.57 Total Benefits † ....................................................................................................................................................................... Consumer Incremental Product Costs ‡ ........................................................................................................................................ 35.11 13.31 Net Benefits ............................................................................................................................................................................ 14.52 7% discount rate Consumer Operating Cost Savings ............................................................................................................................................... Climate Benefits * (3% discount rate) ............................................................................................................................................ Health Benefits ** ........................................................................................................................................................................... 12.73 2.71 1.91 Total Benefits † ....................................................................................................................................................................... Consumer Incremental Product Costs ‡ ........................................................................................................................................ 17.35 7.58 Net Benefits ............................................................................................................................................................................ 5.14 ddrumheller on DSK120RN23PROD with PROPOSALS2 Note: This table presents the costs and benefits associated with RCWs 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) (see section IV.L of this document). Together these represent the global 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 DOE does not have a single central SC–GHG point estimate. 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 benefits where appropriate and permissible under law. 8 DOE calculated emissions reductions relative to the no-new-standards case, which reflects key assumptions in the Annual Energy Outlook 2022 (‘‘AEO2022’’). AEO2022 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 AEO2022 assumptions that effect air pollutant emissions. 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– VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 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 PO 00000 Frm 00005 Fmt 4701 Sfmt 4702 presents monetized benefits where appropriate and permissible under law. 10 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. www.whitehouse.gov/wp-content/uploads/2021/02/ TechnicalSupportDocument_ SocialCostofCarbonMethaneNitrousOxide.pdf. 11 DOE estimates the economic value of these emissions reductions resulting from the considered TSLs for the purpose of complying with the requirements of Executive Order 12866. E:\FR\FM\03MRP2.SGM 03MRP2 13524 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules ** 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. See section IV.L of this document for more details. † Total and net benefits include those consumer, climate, and health benefits that can be quantified and 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 DOE does not have a single central SC–GHG point estimate. DOE emphasizes the importance and value of considering the benefits calculated using all four sets of SC–GHG estimates. ‡ Costs include incremental equipment costs as well as installation costs. The benefits and costs of the proposed standards 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 climate and benefits of emission reductions, all annualized.12 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 RCWs 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 RCWs 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 IV.L of this document. Table I.4 presents the total estimated monetized benefits and costs associated with the proposed standard, expressed in terms of annualized values. 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 NOX and SO2 emissions, and the 3-percent discount rate case for climate benefits from reduced GHG emissions, the estimated cost of the standards proposed in this rule is $800.8 million per year in increased equipment costs, while the estimated annual benefits are $1,344.2 million in reduced equipment operating costs, $155.7 million in climate benefits, and $202.0 million in health benefits. In this case, the net benefit would amount to $901.1 million per year. Using a 3-percent discount rate for all benefits and costs, the estimated cost of the proposed standards is $764.0 million per year in increased equipment costs, while the estimated annual benefits are $1,598.0 million in reduced operating costs, $155.7 million in climate benefits, and $262.2 million in health benefits. In this case, the net benefit would amount to $1,251.8 million per year. TABLE I.4—ANNUALIZED MONETIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR RESIDENTIAL CLOTHES WASHERS [TSL 4] Million 2021$/year Primary estimate Low-netbenefits estimate High-netbenefits estimate 3% discount rate Consumer Operating Cost Savings ............................................................................................. Climate Benefits * ......................................................................................................................... Health Benefits ** ......................................................................................................................... 1,598.0 155.7 262.2 1,544.5 151.7 255.8 1,657.8 159.7 268.9 Total Benefits† ...................................................................................................................... Consumer Incremental Product Costs ‡ ...................................................................................... 2,015.9 764.0 1,952.0 778.7 2,086.4 695.5 Net Benefits .......................................................................................................................... 1,251.8 1,173.4 1,390.9 Consumer Operating Cost Savings ............................................................................................. Climate Benefits * (3% discount rate) .......................................................................................... Health Benefits ** ......................................................................................................................... 1,344.2 155.7 202.0 1,302.8 151.7 197.5 1,389.7 159.7 206.7 Total Benefits † ..................................................................................................................... Consumer Incremental Product Costs‡ ....................................................................................... 1,701.9 800.8 1,652.0 813.3 1,756.1 737.9 Net Benefits .......................................................................................................................... 901.1 838.7 1,018.3 ddrumheller on DSK120RN23PROD with PROPOSALS2 7% discount rate Note: This table presents the costs and benefits associated with RCWs shipped in 2027–2056. These results include benefits to consumers which accrue after 2056 from the products shipped in 2027–2056. The Primary, Low Net Benefits, and High Net Benefits Estimates utilize projections of energy prices from the AEO2022 Reference case, Low Economic Growth case, and High Economic Growth case, respectively. In addition, incremental equipment costs reflect a medium decline rate in the Primary Estimate, a low decline rate in the Low Net Benefits Estimate, and a high decline rate in the High Net Benefits Estimate. The methods used to derive projected price trends are explained in sections IV.F.1 and IV.H.3 of this document. Note that the Benefits and Costs may not sum to the Net Benefits due to rounding. 12 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 VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 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, PO 00000 Frm 00006 Fmt 4701 Sfmt 4702 DOE then calculated the fixed annual payment over a 30-year period, starting in the compliance year, that yields the same present value. E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules 13525 * 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 sets of 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 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. See section IV.L of this document for more details. † Total benefits include 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. ‡ Costs include incremental equipment costs as well as installation costs. ddrumheller on DSK120RN23PROD with PROPOSALS2 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, 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, and a 3percent discount rate case for GHG social costs, the estimated cost of the proposed standards for RCWs is $800.8 million per year in increased product costs, while the estimated annual benefits are $1,344.2 million in reduced product operating costs, $155.7 million in climate benefits and $202.0 million in health benefits. The net benefit amounts to $901.1 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.13 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. 13 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). VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 Accordingly, DOE evaluates the significance of energy savings on a caseby-case basis. As previously mentioned, the proposed standards are projected to result in estimated national energy savings of 1.45 quads FFC, the equivalent of the primary annual energy use of 16 million homes. The NPV of consumer benefit for these projected energy savings is $5.14 billion using a discount rate of 7 percent, and $14.52 billion using a discount rate of 3 percent. The cumulative emissions reductions associated with these energy savings are 53.21 Mt of CO2, 19.93 thousand tons of SO2, 92.39 thousand tons of NOX, 0.13 tons of Hg, 411.43 thousand tons of CH4, and 0.48 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) is $2.71 billion. The estimated monetary value of the health benefits from reduced SO2 and NOX emissions is $1.91 billion using a 7-percent discount rate and $4.57 billion using a 3-percent discount rate. As such, 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).14 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’’).15 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 14 See section III.E.2 of this document for further discussion of how DOE determines whether energy savings are ‘‘significant’’ within the context of the statute. 15 The TSD is available in the docket for this proposed rulemaking at www.regulations.gov/ docket/EERE-2017-BT-STD-0014. PO 00000 Frm 00007 Fmt 4701 Sfmt 4702 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 RCWs. 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 RCWs, the subject of this document. (42 U.S.C. 6292(a)(7)) EPCA prescribed energy conservation standards for these products (42 U.S.C. 6295(g)(2) and (9)(A)), and directs DOE to conduct future rulemakings to determine whether to amend these standards. (42 U.S.C. 6295(g)(4) and (9)(B)) 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 E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 13526 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules 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(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 RCWs appear at 10 CFR part 430, subpart B, appendix J (‘‘appendix J’’) and appendix J2 (‘‘appendix J2’’). DOE must follow specific statutory criteria for prescribing new or amended standards for covered products, including RCWs. 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 (‘‘Secretary’’) 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)) 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 VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 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 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 the manufacturers and on the consumers of the products subject to such standard; (2) 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 products which are likely to result from the imposition of the standard; (3) The total projected amount of energy, or as applicable, water, savings likely to result directly from the imposition of the standard; (4) Any lessening of the utility or the performance of the covered products likely to result from the imposition of the standard; (5) The impact of any lessening of competition, as determined in writing by the Attorney General, that is likely to result from the imposition of the standard; (6) The need for national energy and water conservation; and (7) Other factors the 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 PO 00000 Frm 00008 Fmt 4701 Sfmt 4702 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 subcategories. 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 RCWs address standby mode and off mode energy use as part of the EER metric. 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 current energy conservation standards for RCWs were established in a direct final rule published on May 31, 2012. 77 FR 32308 (‘‘May 2012 Final Rule’’).16 These standards are consistent with a joint proposal submitted to DOE 16 DOE published a confirmation of effective date and compliance date for the direct final rule on October 1, 2012. 77 FR 59719. E:\FR\FM\03MRP2.SGM 03MRP2 13527 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules by interested parties representing manufacturers, energy and environmental advocates, and consumer groups.17 The current standards are defined in terms of a minimum allowable integrated modified energy factor (‘‘IMEF’’), measured in cubic feet per kilowatt-hour per cycle (‘‘ft3/kWh/ cycle’’), and maximum allowable integrated water factor (‘‘IWF’’), measured in gallons per cycle per cubic foot (‘‘gal/cycle/ft3’’), as measured according to appendix J2. Id. The May 2012 Final Rule established four classes of RCW: top-loading, compact (less than 1.6 ft3 capacity); top-loading, standardsize (1.6 ft3 or greater capacity); frontloading, compact (less than 1.6 ft3 capacity); and front-loading, standardsize (1.6 ft3 or greater capacity). 77 FR 32308, 32316–32320. The May 2012 Final Rule established a two-phase compliance date—the first phase of amended standards applied to RCWs manufactured on or after March 7, 2015. 77 FR 32308, 32380. The second phase of amended standards, which is currently applicable, applies to RCWs manufactured on or after January 1, 2018. Id. The current energy conservation standards for RCWs are set forth in DOE’s regulations at 10 CFR 430.32(g)(4) and are shown in Table II.1. TABLE II.1—FEDERAL ENERGY CONSERVATION STANDARDS FOR RESIDENTIAL CLOTHES WASHERS Minimum integrated modified energy factor 3 (ft /kWh/cycle) Product class ddrumheller on DSK120RN23PROD with PROPOSALS2 Top-Loading, Compact (less than 1.6 ft3 capacity) ......................................................................... Top-Loading, Standard-Size (1.6 ft3 or greater capacity) ............................................................... Front-Loading, Compact (less than 1.6 ft3 capacity) ...................................................................... Front-Loading, Standard-Size (1.6 ft3 or greater capacity) ............................................................. 1.15 1.57 1.13 1.84 Maximum integrated water factor (gal/cycle/ft3) 12.0 6.5 8.3 4.7 2. History of Standards Rulemaking for Residential Clothes Washers On August 2, 2019, DOE published a request for information (‘‘RFI’’) to initiate an effort to determine whether to amend the current energy conservation standards for RCWs. 84 FR 37794 (‘‘August 2019 RFI’’). Specifically, through the August 2019 RFI, DOE sought data and information that could enable the agency to determine whether DOE should propose a ‘‘no new standard’’ determination because a more stringent standard: (1) would not result in a significant savings of energy; (2) is not technologically feasible; (3) is not economically justified; or (4) any combination of foregoing. Id. On September 29, 2021, DOE published a notification of the availability of a preliminary technical support document for RCWs (‘‘September 2021 Preliminary Analysis’’). 86 FR 53886. In that notification, DOE sought comment on the analytical framework, models, and tools that DOE used to evaluate potential standards for RCWs, the results of preliminary analyses performed, and the potential energy conservation standard levels derived from these analyses, which DOE presented in the accompanying Preliminary TSD (‘‘September 2021 Preliminary TSD’’).18 Id. On October 29, 2021, DOE extended the comment period for the September 2021 Preliminary Analysis for an additional 45 days. 86 FR 59889. The September 2021 Preliminary Analysis was conducted based on energy and water use metrics as measured according to proposed amendments to the test procedure as published in a NOPR on September 1, 2021 (‘‘September 2021 TP NOPR’’). 86 FR 49140. Part of this analysis included developing translations between the metrics established by the current appendix J2 test procedure (i.e., IMEF and IWF) and the new metrics proposed to be established by the new appendix J test procedure (i.e., EER and WER). On April 13, 2022, DOE published a notification of data availability (‘‘NODA’’) presenting the results of additional testing conducted in furtherance of the development of the translations between the current test procedure and the proposed new test procedure. 87 FR 21816 (‘‘April 2022 NODA’’). The April 2022 NODA included a larger sample size of RCWs than the September 2021 Preliminary Analysis (44 units compared to 16 in the September 2021 Preliminary Analysis, and covering all proposed product classes). The April 2022 NODA presented detailed energy and water use measurements for each model as well as a summary of key characteristics pertaining to each model (e.g., product class, capacity, cabinet width, etc.). On May 19, 2022, DOE reopened the comment period for the April 2022 NODA and provided additional information in response to stakeholder questions. 87 FR 30433. DOE received comments in response to the September 2021 Preliminary Analysis and April 2022 NODA from the interested parties listed in Table II.2. 17 Available at: www.regulations.gov/document/ EERE-2008-BT-STD-0019-0032. 18 September 2021 Residential Clothes Washers Energy Conservation Standards Preliminary Technical Support Document. Available online at www.regulations.gov/document/EERE-2017-BTSTD0014-0030. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 PO 00000 Frm 00009 Fmt 4701 Sfmt 4702 E:\FR\FM\03MRP2.SGM 03MRP2 13528 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules TABLE II.2—WRITTEN COMMENTS RECEIVED IN RESPONSE TO THE SEPTEMBER 2021 PRELIMINARY ANALYSIS AND APRIL 2022 NODA Comment No. in the docket In response to September 2021 Preliminary Analysis Commenter type Commenter(s) Abbreviation In response to April 2022 NODA Ameren Illinois, Commonwealth Edison Company, Northwest Energy Efficiency Alliance, and Northwest Power and Conservation Council Staff. Appliance Standards Awareness Project, American Council for an Energy-Efficient Economy, Consumer Federation of America, Natural Resources Defense Council. Art Fraas ......................................................................................... Association of Home Appliance Manufacturers ............................. Ameren et al ......... 42 * n/a ASAP et al ............ 37 51 Fraas ..................... AHAM .................... 35 40 n/a 53 Commonwealth Edison Company and Northwest Energy Efficiency Alliance. ComEd and NEEA n/a 50 GE Appliances ................................................................................ Members of the committee of the National Academies of Sciences, Engineering, and Medicine. New York State Energy Research and Development Authority .... GEA ...................... NAS Members ...... 38 34 n/a n/a NYSERDA ............. 36 n/a Pacific Gas and Electric Company, San Diego Gas and Electric, and Southern California Edison; collectively, the California Investor-Owned Utilities. Samsung ........................................................................................ Whirlpool Corporation ..................................................................... CA IOUs ................ 43 52 Individual. Trade Association. Utility & Efficiency Organization. Manufacturer. National Advisors. Public Benefit Corporation. Utilities. Samsung ............... Whirlpool ............... 41 39 n/a n/a Manufacturer. Manufacturer. Efficiency Organization & Utilities. Efficiency Organizations. ddrumheller on DSK120RN23PROD with PROPOSALS2 * ‘‘n/a’’ signifies that the commenter or group of commenters did not provide a comment in response to the particular notification. A parenthetical reference at the end of a comment quotation or paraphrase provides the location of the item in the public record.19 To the extent that interested parties have provided written comments that are substantively consistent with any oral comments provided during the November 10, 2021, public meeting, DOE cites the written comments throughout this document. Any oral comments provided during the webinar that are not substantively addressed by written comments are summarized and cited separately throughout this document. GEA commented in support of AHAM’s comments and incorporated AHAM’s comments into its own by reference. (GEA, No. 38 at p. 2) Whirlpool commented that it supports and echo AHAM’s positions. (Whirlpool, No. 39 at p. 2) Whirlpool added that its comments expand upon AHAM’s comments and provide additional detail or data to reinforce its positions, as well as to comment on areas where AHAM cannot comment. (Id.) 19 The parenthetical reference provides a reference for information located in the docket of DOE’s rulemaking to develop energy conservation standards for RCWs. (Docket NO. EERE–2017–BT– STD–0014, 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 21:12 Mar 02, 2023 Jkt 259001 NYSERDA commented that it supports the detailed comments provided by ASAP et al., most notably investigating the correlation between clothes washer capacity and measured efficiency. (NYSERDA, No. 36 at p. 2) AHAM specified that its comments in response to the April 2022 NODA do not supplant its previous comments submitted in response to the September 2021 Preliminary Analysis, but instead supplement those comments. (AHAM, No. 53 at p. 2) C. Deviation From Appendix A In accordance with section 3(a) of 10 CFR part 430, subpart C, appendix A (‘‘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. While DOE published a preliminary analysis for this rulemaking, DOE did not publish a framework document in conjunction with the preliminary analysis. DOE notes, however, chapter 2 of the PO 00000 Frm 00010 Fmt 4701 Sfmt 4702 September 2021 Preliminary TSD that accompanied the September 2021 Preliminary Analysis—entitled Analytical Framework, Comments from Interested Parties, and DOE Responses— describes the general analytical framework that DOE uses in evaluating and developing potential amended energy conservation standards. Additionally, prior to the notification of the September 2021 Preliminary Analysis, DOE published an RFI in which DOE identified and sought comment on the analyses conducted in support of the most recent energy conservation standards rulemakings for RCWs. 84 FR 37794. As such, publication of a separate framework document would be largely redundant of previously published documents. 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. DOE requested comment in the August 2019 RFI on the technical and economic analyses and provided stakeholders a 60-day comment period, after publishing the comment period extension. 84 FR 37794, 84 FR 44557. Additionally, DOE initially provided a 75-day comment period for the September 2021 E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules Preliminary Analysis with an extension to 120 days. 86 FR 53886, 86 FR 59889. DOE also provided a 30-day comment period for the April 2022 NODA and reopened the comment period for an additional 9 days. 87 FR 21816, 87 FR 30433. The analytical methods used for this NOPR are similar to those used in previous rulemaking notices. As such, DOE believes a 60-day comment period is necessary and appropriate and will provide interested parties with a meaningful opportunity to comment on the proposed rule. ddrumheller on DSK120RN23PROD with PROPOSALS2 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. General Comments This section summarizes general comments received from interested parties regarding rulemaking timing and process. AHAM commented that publishing the September 2021 TP NOPR and the September 2021 Preliminary Analysis concurrently did not allow sufficient time for stakeholders to provide meaningful comments on either publication. (AHAM, No. 40 at pp. 2–4) AHAM commented that although DOE missed the statutory deadlines for both the test procedure and standards rulemakings, it is disingenuous to claim that the only option is to move forward concurrently on these rulemakings. (Id.) AHAM suggested that DOE should have published the test procedure earlier, considered implementing fewer changes to the test procedure, or made changes that do not require testing to evaluate or reestablish the baseline energy conservation standards. (Id.) AHAM expressed concern that DOE moving forward concurrently with these rulemakings will likely lead to DOE needing to conduct additional analysis based on the finalized test procedure before proposing a new energy conservation standard, and that DOE is missing the opportunity to receive meaningful feedback on the September 2021 Preliminary Analysis. (Id.) AHAM added that despite DOE’s desire to move quickly to rectify missed statutory deadlines, DOE must ensure it meets other statutory criteria, including that a standard must be technically and economically justified. (Id.) AHAM noted that the comment periods for the September 2021 Preliminary Analysis and the September 2021 TP NOPR overlapped by 34 days. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 AHAM noted that it requested a 92-day comment period extension for the September 2021 TP NOPR to provide adequate time to evaluate the proposed changes to the test procedure through testing. (AHAM, No. 53 at p. 2) AHAM added that while it appreciated DOE considering that request and extending the comment period by 28 days, that extension was insufficient to complete the robust testing plan developed by AHAM and its members, gather the test data, and analyze the results. (AHAM, No. 40 at pp. 2–4; AHAM, No. 53 at p. 2) AHAM stated that because of the insufficient time, it was unable to provide detailed comment on the accuracy, repeatability, and testing burden associated with the proposed test procedure and on its potential impact on measured efficiency, or fully comment on the proposed test procedures implications related to the September 2021 Preliminary Analysis. (AHAM, No. 53 at p. 2) AHAM further stated that it was planning its own testing in order to fully understand and evaluate DOE’s proposed changes. (AHAM, No. 40 at pp. 2–4) AHAM commented that it was poor process for DOE to issue a test procedure final rule before receiving comments on the April 2022 NODA, and to do so during a brief comment period extension. (Id.) AHAM added that DOE finalizing the test procedure during the brief NODA comment period extension made it nearly impossible for AHAM to review and analyze the final test procedure in addition to the new data and responses to AHAM’s questions in order to formulate complete comments on the NODA. (Id.) AHAM further commented that although DOE did not hold a public meeting for the April 2022 NODA, it appreciated that DOE answered its questions and provided more time for comments in order to allow commenters to review the updates. (AHAM, No. 53 at pp. 2–3) AHAM stated, however, that the timing of when DOE provided links to the updated data and responses to questions left very little time for review and analysis of the additional data and information. (Id.) AHAM noted that although the April 2022 NODA is technically part of the energy conservation standards docket, comments on DOE’s test data could relate to both the energy conservation standards and test procedure rulemakings. (AHAM, No. 53 at p. 3) AHAM stated that its comments in response to the April 2022 NODA therefore address both the test procedure and the energy conservation standards. (Id.) AHAM commented that PO 00000 Frm 00011 Fmt 4701 Sfmt 4702 13529 it was poor process for DOE to issue a test procedure final rule before receiving comments on the April 2022 NODA, and to do so during a brief comment period extension. (Id.) AHAM further explained that even though DOE answered or deferred most of AHAM’s requests in the test procedure final rule and in the April 2022 NODA, AHAM’s comments on the September 2021 Preliminary Analysis indicated that additional information was needed in order to provide full feedback to DOE on the test procedure. (Id.) AHAM added that DOE finalizing the test procedure during the brief NODA comment period extension made it nearly impossible for AHAM to review and analyze the final test procedure in addition to the new data and responses to AHAM’s questions in order to formulate complete comments on the NODA. (Id.) AHAM requested that DOE allow for 180 days between the publication of the test procedure final rule and the end of the comment period for the energy conservation standards NOPR. (AHAM, No. 40 at pp. 4–6; AHAM, No. 53 at p. 12) Samsung also commented that, given the scope of changes proposed in appendix J, more data would be needed to establish the baseline and efficiency levels, which could further delay the finalization of the next energy conservation standards. (Samsung, No. 41 at p. 3) Samsung commented that it therefore believes more time and test data are needed to fully adopt appendix J. (Id.) NYSERDA encouraged DOE to quickly proceed in this rulemaking to unlock additional significant savings for New Yorkers. (NYSERDA, No. 36 at p. 3) In response to AHAM’s comments regarding the timing of the September 2021 TP NOPR and the September 2021 Preliminary Analysis, DOE notes that the timing of the test procedure and energy conservation standards rulemakings have been conducted in accordance with DOE’s procedures at appendix A to subpart C of part 430, Procedures, Interpretations, and Policies for Consideration of New or Revised Energy Conservation Standards and Test Procedures for Consumer Products and Certain Commercial/Industrial Equipment (‘‘appendix A’’ or ‘‘Process Rule’’). The Process Rule inherently recognizes a certain amount of overlap between test procedure and energy conservation standards rulemakings. In particular, the Process Rule specifies that new test procedures and amended test procedures that impact measured energy use or efficiency will be finalized at least 180 days prior to the close of the E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 13530 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules comment period for a NOPR proposing new or amended energy conservation standards or a notice of proposed determination that standards do not need to be amended. Section 8(d)(1) of appendix A. Inherent to this requirement is a recognition that the earlier stages of the test procedure rulemaking (i.e., the test procedure NOPR stage) would be conducted concurrently with the pre-NOPR stages of the energy conservation standards rulemaking (i.e., the preliminary analysis stage). In other words, the implication of the timing established by the Process Rule is that a test procedure NOPR may provide the basis for a standards preliminary analysis; while a test procedure final rule provides the basis for a standards NOPR. DOE published a test procedure final rule on June 1, 2022 (‘‘June 2022 TP Final Rule’’). 87 FR 33316. This standards NOPR is publishing more than 180 days after the publication of the June 2022 TP Final Rule, in accordance with the requirements of the Process Rule. As acknowledged by AHAM, DOE is conducting this rulemaking in fulfillment of its statutory obligations under EPCA. DOE recognizes and appreciates the information and data provided by multiple interested parties in response to the September 2021 TP NOPR, September 2021 Preliminary Analysis, and April 2022 NODA. As discussed throughout this NOPR, DOE has incorporated data and other information received during these prior rulemaking stages into the analyses conducted for this NOPR. In response to the September 2021 Preliminary TSD, AHAM commented that DOE did not provide sufficient data to support the September 2021 Preliminary TSD, and that DOE’s analysis was not transparent. (AHAM, No. 40 at pp. 4–6) AHAM asserted that by providing summary data and conclusions without providing further detail, DOE failed to meet the requirements of the Administrative Procedure Act or the Data Quality Act. (Id.) AHAM further commented that the summary information that DOE provided as part of the September 2021 Preliminary TSD was somewhat helpful but did not allow stakeholders to fully assess the data and did not clearly demonstrate that DOE’s proposed translation between appendix J2 and proposed appendix J was accurate. (Id.) AHAM requested that DOE provide its full test data by model for all models tested to appendix J2 and new appendix J, via a NODA or other appropriate regulatory tool. (Id.) AHAM also requested that DOE share the model numbers of the clothes washers it tested VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 since it would help stakeholders, such as AHAM and its members, determine the representativeness of the sample. (Id.) Specifically, AHAM requested that all data released contain all variables including, but not limited to: total weighted per-cycle hot water energy consumption (‘‘HET’’), total weighted per-cycle machine electrical energy consumption (‘‘MET’’), total per-cycle energy consumption for removal of moisture (‘‘DET’’), combined per-cycle low power mode energy consumption (‘‘ETLP’’), and total weighted per-cycle water consumption (‘‘QT’’). (Id.) AHAM asked that if DOE cannot provide the information AHAM requested, DOE should issue an explanation as to why it cannot produce the data. (Id.) AHAM added that it will consider sharing its data confidentially with DOE once its analysis is complete so that DOE can include its analysis on the docket. (Id.) AHAM stated that DOE should not issue an energy conservation standards NOPR until it publishes a NODA that provides updated data from DOE and AHAM members’ testing. (AHAM, No. 40 at pp. 4–6) In response to the April 2022 NODA, AHAM commented that it had tested 26 RCW models that represent a crosssection of the market in terms of capacity and features. (AHAM, No. 53 at pp. 6–7) AHAM tested each model one to three times and averaged the results. (Id.) AHAM presented data comparing IMEF versus EER and IWF versus WER for the 26 units tested by AHAM and the 44 units tested by DOE in the April 2022 NODA, by product class. (Id.) AHAM concluded that DOE’s data presented in the April 2022 NODA appears to be similar to AHAM’s data in terms of test results, distribution of models, and variability. (Id.) AHAM commented that while it appreciates DOE including equations and other transparent information in the April 2022 NODA, DOE still has not provided model numbers for the units it tested. (Id.) AHAM therefore noted that it is impossible for AHAM to know whether DOE and AHAM tested some of the same models. (Id.) The CA IOUs encouraged DOE to disclose clothes washer cycle time, length of spin time for extracting rinse water, and the maximum spin speed for the 62 clothes washers tested by DOE so that interested parties could better ascertain the trade-offs related to cycle time and gain a better understanding of the differences between the remaining moisture content (‘‘RMC’’) 20 as 20 The RMC represents the amount of moisture remaining in the test load at the end of the washer cycle. RMC is used to calculate the drying energy PO 00000 Frm 00012 Fmt 4701 Sfmt 4702 calculated using appendix J2 versus appendix J. (CA IOUs, No. 43 at p. 4) The CA IOUs commented that in the September 2021 Preliminary TSD, higher spin speeds and longer spin times were both used as design options for efficiency level (‘‘EL’’) 3 and EL 4, depending on the product class and that based on the publicly available information, they were unable to assess the potential impacts to the overall cycle time or to understand the potential trade-offs for higher spin speeds in lieu of longer cycle times. (Id.) As discussed in section II.B.2 of this document, the April 2022 NODA presented additional test data and detailed information characterizing each tested model. This data included the key energy and water use parameters requested by AHAM (i.e., HET, MET, DET, ETLP, and QT) for each of the models tested. DOE also provided a number of key characteristics pertaining to each model (e.g., product class, capacity, cabinet width, etc.) that illustrate the types of units on the market that were represented by DOE’s test program. DOE appreciates the additional test data subsequently provided by AHAM. As discussed in section IV.C.5 of this document, DOE used AHAM’s data in combination with DOE’s data to evaluate the appendix J2 to appendix J efficiency metric translation methods under consideration. Regarding the CA IOUs’ comment requesting disclosure of the cycle time measured for each unit in DOE’s test sample, although the April 2022 NODA did not indicate the measured cycle time of each unit in DOE’s test sample, DOE has characterized the average cycle time associated with each defined efficiency level for each product, as described in chapter 5 of the NOPR TSD. NAS Members commented generally on DOE’s analytical approach to setting efficiency standards and offered findings and recommendations for improving DOE’s methodology, and ultimately, the net social benefits of the efficiency standards DOE establishes under EPCA. (NAS Members, No. 34 at pp. 1–7) AHAM commented that National Academy of Sciences (‘‘NAS’’) recently released a peer review of methods used by DOE in setting appliance and equipment standards. (AHAM, No. 40 at p. 9) AHAM recommended that DOE determine how it will address the NAS component of IMEF and EER. On most clothes washers, the drying energy component represents the largest portion of energy captured in the IMEF and EER metrics. E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules ddrumheller on DSK120RN23PROD with PROPOSALS2 report before engaging in further rulemakings or new amended standards. (Id.) AHAM acknowledged that although this may not be feasible given the number of missed deadlines and the need to move forward to mitigate further missed deadlines, AHAM and its members are reviewing the NAS report and may have additional comments on how DOE should revise its methodology for future rulemakings both generally, and with regard to RCWs. (Id.) In response to AHAM, DOE is addressing the contents of the NAS report 21 in a separate rulemaking, in parallel with other ongoing rulemakings including this RCW rulemaking. B. Scope of Coverage This NOPR covers those consumer products that meet the definition of ‘‘clothes washer.’’ 10 CFR 430.2. EPCA does not define the term ‘‘clothes washer.’’ DOE has defined a ‘‘clothes washer’’ as a consumer product designed to clean clothes, utilizing a water solution of soap and/or detergent and mechanical agitation or other movement, that must be one of the following classes: automatic clothes washers, semi-automatic clothes washers, and other clothes washers. Id. An ‘‘automatic clothes washer’’ is a class of clothes washer that has a control system that is capable of scheduling a preselected combination of operations, such as regulation of water temperature, regulation of the water fill level, and performance of wash, rinse, drain, and spin functions without the need for user intervention subsequent to the initiation of machine operation. Some models may require user intervention to initiate these different segments of the cycle after the machine has begun operation, but they do not require the user to intervene to regulate the water temperature by adjusting the external water faucet valves. Id. A ‘‘semi-automatic clothes washer’’ is a class of clothes washer that is the same as an automatic clothes washer except that user intervention is required to regulate the water temperature by adjusting the external water faucet valves. Id. ‘‘Other clothes washer’’ means a class of clothes washer that is not an automatic or semi-automatic clothes washer. Id. See section IV.A.1 of this document for discussion of the product classes analyzed in this NOPR. 21 The Consensus Study Report, ‘‘Review of Methods Used by the U.S. Department of Energy in Setting Appliance and Equipment Standards,’’ January 7, 2022. Available at www.nap.edu/catalog/ 25992/review-of-methods-used-by-the-usdepartment-of-energy-in-setting-appliance-andequipment-standards. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 Other definitions relevant to RCWs have been established by the Environmental Protection Agency (‘‘EPA’’) for purposes of the ENERGY STAR program. For example, Version 8.1 of the Program Requirements Product Specification for Clothes Washers (‘‘ENERGY STAR Version 8.1 Specification’’) 22 defines a ‘‘combination all-in-one washer-dryer’’ as a consumer product that meets the definition of an RCW and an electric clothes dryer or gas clothes dryer, which cleans and dries clothes in a single tumble-type drum; a drying cycle can be performed independently without first performing a wash cycle. During the drying cycle, combination all-in-one washer-dryers use one of two methods to dry the clothing load: either using circulated air (without the use of water) to cool and condense moisture from the dryer process air (i.e., ‘‘combination allin-one washer-dryers with air-only drying’’), or consuming water to cool and condense moisture from the dryer process air (i.e., ‘‘combination all-in-one washer-dryers with water-cooled drying’’). In the ENERGY STAR Version 8.1 Specification, combination all-inone washer-dryers with air-only drying are eligible for ENERGY STAR certification, whereas combination allin-one washer-dryers with water-cooled drying are ineligible for ENERGY STAR certification. The CA IOUs encouraged DOE to investigate water-cooled combination all-in-one washer-dryers and to take steps to address water usage concerns raised by the ENERGY STAR Version 8.1 Specification published in April 2021. (CA IOUs, No. 43 at pp. 6–7) The CA IOUs noted that combination all-inone washer-dryers with water-cooled drying are not currently subject to any water use standards or water-usage testing requirements despite the recent changes finalized by the clothes dryer test procedure final rule published on October 8, 2021. (See 86 FR 56608; Id.) The CA IOUs expressed concern that there is unmeasured and unregulated water use in products that seemingly include a water standard for the washing mode of the same product. (Id.) The CA IOUs encouraged DOE to find ways to disclose this information, including requiring public disclosure of any product configurations that use 22 ENERGY STAR Version 8.1 Program Requirements Product Specification for Clothes Washers. Available online at www.energystar.gov/ sites/default/files/asset/document/ ENERGY%20STAR%20Version%208.1 %20Clothes%20Washer%20Final %20Specificaiton%20%20Partner%20Commitments%20and %20Eligibility%20Criteria.pdf. PO 00000 Frm 00013 Fmt 4701 Sfmt 4702 13531 water during the drying cycle as part of the certification requirements and relevant product labeling; making changes to the consumer clothes dryer test procedure to measure water use for combination clothes washer products; and developing a separate test procedure and standard for combination all-in-one washer-dryers and laundry centers that include both the washing and drying functions. (Id.) Evaluating or developing test procedures is outside the scope of this energy conservation standards rulemaking. DOE is not proposing any certification or labeling requirements in this NOPR. Instead, DOE may consider proposals to establish certification requirements and reporting for RCWs under a separate rulemaking regarding appliance and equipment certification. C. 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. DOE’s current energy conservation standards for RCWs are expressed in terms of IMEF and IWF as measured using appendix J2. (See 10 CFR 430.32(g)(4).) 1. History of Appendix J As discussed, the September 2021 TP NOPR proposed a new test procedure at appendix J, which proposed to define new energy efficiency metrics: an energy efficiency ratio (i.e., EER) and a water efficiency ratio (i.e., WER). 86 FR 49140, 49172. EER is defined as the weighted-average load size in pounds (‘‘lbs’’) divided by the sum of (1) the per-cycle machine energy, (2) the percycle water heating energy, (3) the percycle drying energy, and (4) the percycle standby and off mode energy consumption, in kilowatt-hours (‘‘kWh’’). Id. WER is defined as the weighted-average load size in lbs divided by the total weighted per-cycle water consumption for all wash cycles in gallons. Id. For both EER and WER, a higher value indicates more efficient performance. Id. The September 2021 Preliminary Analysis was performed using the appendix J test procedure as it was proposed in the September 2021 TP NOPR. As discussed, DOE finalized the new appendix J test procedure in the June 2022 TP Final Rule. 87 FR 33316. DOE used appendix J as finalized in the June E:\FR\FM\03MRP2.SGM 03MRP2 13532 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules ddrumheller on DSK120RN23PROD with PROPOSALS2 2022 TP Final Rule as the basis for the analysis in this NOPR. AHAM commented that DOE did not finalize appendix J as proposed in the September 2021 TP NOPR and that the test procedure changes described in the June 2022 TP Final Rule could impact measured energy and water efficiency. (AHAM, No. 53 at p. 12) AHAM asserted that it may be premature to use the April 2022 NODA data or AHAM’s additional data to inform the translation from appendix J2 metric to appendix J metrics because appendix J is not identical to the test procedure proposed in the September 2021 TP NOPR. (Id. at p. 3) AHAM commented that it is still reviewing finalized appendix J and noted that even if DOE’s and AHAM’s samples together represent a significant portion of shipments, it may be necessary to reconsider the September 2021 Preliminary Analysis based on finalized appendix J. (Id.) The appendix J test procedure finalized by the June 2022 TP Final Rule included only one change that affects measured energy consumption. Specifically, the June 2022 TP Final Rule updated the assumed final moisture content (‘‘FMC’’) assumption in the drying energy formula from 4 percent as proposed in the September 2021 NOPR to 2 percent in finalized appendix J. Id. at 87 FR 33354. DOE specifically discussed in the September 2021 NOPR that it would consider updating the FMC from 4 percent to 2 percent. 86 FR 49140, 49176. The updated FMC value affects only the drying energy calculation and can be implemented formulaically on any test data that was acquired using the version of appendix J as proposed in the September 2021 TP NOPR. In the April 2022 NODA, DOE published two sets of translation equations corresponding to an FMC of 4 percent and 2 percent, respectively, providing interested parties with the opportunity to evaluate the data under both approaches. 87 FR 21816, 21817. 2. Metrics As discussed, under appendix J2, energy efficiency is measured using the IMEF metric, measured in ft3/kWh/ cycle, and water efficiency is measured using the IWF metric, measured in gal/ cycle/ft3. Under appendix J, energy efficiency is measured using the EER metric, measured in lb/kWh/cycle, and water efficiency is measured using the WER metric, measured in lb/gal/cycle. Samsung commented in support of the efficiency metric changes shifting from capacity-based to load size-based, stating that it would be better VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 understood by consumers. (Samsung, No. 41 at p. 3) Samsung recommended, however, that this be the only change that DOE implements to calculate the new energy and water efficiency metrics EER and WER. (Id.) Samsung added that shifting the metrics to EER and WER in this way will only result in a change in the numeric quantity of measured efficiency, given that the capacity and weighted-average load size relationship is linear. (Id.) Samsung commented that changing only the metric calculation would ease burden for manufacturers while making it easier for consumers to understand their clothes washer’s efficiency. (Id.) EPCA requires that any test procedures prescribed or amended by DOE shall be reasonably designed to produce test results which measure energy efficiency, energy use or estimated annual operating cost of a covered product or equipment during a representative average use cycle or period of use, and shall not be unduly burdensome to conduct. (42 U.S.C. 6293(b)(3)) As presented in the June 2022 TP Final Rule, in general the changes in appendix J in comparison to appendix J2 improve the representativeness of test results and reduce test burden, among other benefits. 87 FR 33316, 33320–33321. In this NOPR, DOE is proposing standards based on the new metrics defined in appendix J as finalized. To aid interested parties in understanding the translation between the current metrics and the new metrics, the engineering analysis is presented using both the current metrics (i.e., IMEF and IWF) and the new metrics (i.e., EER and WER), as discussed in section IV.C of this document. ASAP et al., commented in support of DOE’s change to make the efficiency metrics based on load size instead of capacity, which they asserted will help mitigate the current bias toward largecapacity clothes washers. (ASAP et al., No. 37 at p. 2) ASAP et al., expressed concern, however, that for top-loading standard-size clothes washers, largecapacity clothes washers still achieve higher efficiency ratings. (Id.) ASAP et al., stated that while the correlation between large capacity and high efficiency is less pronounced for EER than for IMEF, it persists based on the data presented in the September 2021 Preliminary TSD. (Id.) ASAP et al., therefore encouraged DOE to investigate whether this correlation results from larger clothes washers being inherently more efficient, larger clothes washers employing additional technology options that improve efficiency, or some PO 00000 Frm 00014 Fmt 4701 Sfmt 4702 remaining inherent bias toward larger capacity clothes washers. (Id.) The CA IOUs commented that while they agree that the appendix J test procedure offers improvements to the test procedure to reduce some inherent biases between efficiency metrics and capacity, tub capacity can still contribute to improved efficiency because a larger amount of clothing can be washed using an incremental increase in the quantity of water, and a larger drum diameter can exert a higher g-force on clothing, thereby removing more water during the final spin and reducing the drying energy. (CA IOUs, No. 43 at pp. 2–3) Whirlpool commented that based on its initial testing, it does not agree with DOE’s conclusion that there is no benefit to larger capacities using the EER metric. Whirlpool commented that since capacity is still factored into the load sizes used for testing, and those load sizes remain a part of the EER calculation, capacity will still affect efficiency ratings. (Whirlpool, No. 39 at p. 19) In the June 2022 TP Final Rule, DOE noted that under the current metrics in appendix J2, energy use (i.e., the denominator of the IMEF equation) scales with weighted-average load size, whereas capacity (i.e., the numerator of the IMEF equation) scales with maximum load size. 87 FR 33316, 33349. This provides an inherent numerical advantage to large-capacity clothes washers that is disproportionate to the efficiency advantage that can be achieved through ‘‘economies of scale’’ associated with washing larger loads. Id. This advantage means that a largercapacity clothes washer consumes more energy to wash a pound of clothes than a smaller-capacity clothes washer with the same IMEF rating. Id. This relationship applies similarly to water efficiency through the IWF equation. Id. This disproportionate benefit increases as average clothes washer capacity increases over time. Id. To avoid providing bias for large-capacity clothes washers, DOE changed the energy and water efficiency metrics in new appendix J by replacing the capacity term with the weighted-average load size. Id. Under appendix J, energy and water use scale proportionally with weighted-average load size, thus eliminating the efficiency ‘‘bias’’ currently provided to large-capacity clothes washers. Id. To the extent that larger clothes washers continue to achieve higher ratings than smaller clothes washers under the new metrics, such higher performance reflects inherent design option advantages applicable to larger- E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules capacity clothes washers. For example, as noted by the CA IOUs, large-capacity clothes washers typically have wider drum diameters, which can exert higher g-forces on the load during the spin cycle for a given spin speed, effectively yielding a lower RMC measurement (i.e., reduced drying energy) compared to an otherwise identical smaller clothes washer with a narrower drum diameter. Having removed the numerical ‘‘bias’’ inherent within the current IMEF and IWF metrics, any remaining performance advantage provided to larger-capacity clothes washers under the new metrics is an accurate and representative reflection of differences in efficiency between smaller- and larger-capacity clothes washers on a perpound of clothing basis. AHAM commented that it appreciates that the appendix J test procedure results in a reduction of test burden and that DOE could even further reduce test burden by eliminating the requirement to measure and calculate standby energy. (AHAM, No. 53 at p. 13) AHAM further commented that in most cases, the standby energy is so low that it is not offset by a benefit to the environment or consumers under EPCA. (Id.) AHAM added that because standby energy use is so low, it is unlikely that manufacturers will reduce it further in order to meet future energy conservation standards; and because manufactures are not likely to increase standby energy use since they have already invested in reducing it, standby energy use will not be a differentiator between products. (Id.) AHAM therefore recommended eliminating the standby measurement requirement because it will not have a material effect on overall energy savings or individual energy testing results. (Id.) As discussed, EPCA requires that any test procedure for RCWs prescribed in a final rule after June 30, 2009 must include standby mode and off mode energy consumption, taking into consideration the most current versions of Standards 62301 and 62087 of the International Electrotechnical Commission, with such energy consumption integrated into the overall energy efficiency, energy consumption, or other energy descriptor for each covered product, unless the Secretary determines that either the current test procedures already fully account for and incorporate the standby mode and off mode energy consumption of the covered product; or such an integrated test procedure is technically infeasible for a particular covered product, in which case EPCA requires the Secretary to prescribe a separate standby mode and off mode energy use test procedure VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 13533 measured RMC of each clothes washer is used to calculate the drying energy, which has a significant impact on the 3. Test Cloth final IMEF or EER value. Application of Both appendix J2 and appendix J these correction factors significantly require the use of specialized test cloth reduces lot-to-lot variation in RMC, that conforms to the specifications from over 10 percentage points outlined in 10 CFR part 430, subpart B, uncorrected to around 3 percentage appendix J3 (‘‘appendix J3’’). As points corrected. 87 FR 33316, 33369. discussed in the June 2022 TP Final AHAM commented that it recently Rule, the specifications for the energy notified DOE of an issue concerning Lot test cloth were developed to be 24 of the test cloth used in clothes representative of the range of fabrics washer testing, stating that AHAM’s comprising consumer wash loads: a 50initial investigations have revealed percent cotton/50-percent polyester serious issues with variation in Lot 24 blended material was specified to that are impacting certification, approximate the typical mix of cotton, verification, and regulatory testing cotton/polyester blend, and synthetic efforts. (AHAM, No. 53 at pp. 4–5) articles that are machine-washed by AHAM specified that the correction consumers. 87 FR 33316, 33366. In developing the test cloth specifications, factor for Lot 24 is not accurate across the entire lot. (Id.) AHAM further DOE also considered: explained that this has resulted in an • Manufacturability: A 50/50 cottonincreased difficulty in meeting the polyester momie weave was specified applicable standard because the because at the time, such cloth was inaccurate correction factor is negatively produced in high volume, had been impacting efficiency. (Id.) AHAM also produced to a consistent specification specified that it is more difficult to for many years, and was expected to be certify products correctly or with produced on this basis for the certainty because the variation in results foreseeable future. 66 FR 3314, 3331. and enforcement are major concerns. • Consistency in test cloth (Id.) AHAM also expressed concern that production: The cloth material testing related to appendix J may be properties were specified in detail, questionable given the Lot 24 correction including fiber content, thread count, factor variation since both DOE and and fabric weight; as well as AHAM used Lot 24 for over half the requirements to verify that water units in their test samples. (Id.) AHAM repellent finishes are not applied to the therefore concluded that the results of cloth. Id. DOE’s and AHAM’s testing should not • Consistency of the RMC be used to reestablish a baseline, as they measurement among different lots: A likely do not accurately represent procedure was developed to generate measured energy or water efficiency. correction factors for each new ‘‘lot’’ (i.e., batch) of test cloth to normalize test (Id.) AHAM further commented that it convened its test cloth task force to results and ensure consistent RMC measurements regardless of which lot is address the correction factor variation issue with the goal of providing used for testing. Id. Test cloth is manufactured in batches recommendations for DOE, and has sought guidance and an enforcement called ‘‘lots,’’ which are quantities of policy from DOE to address the Lot 24 test cloth that have been manufactured issues in the short-term. (Id.) AHAM with the same batches of cotton and noted that since the test cloth Lot 24 polyester during one continuous variation will likely impact the accuracy process. Due to differences between of DOE and AHAM’s testing, AHAM batches of cotton and polyester used to will conduct further review of its data manufacture the test cloth, each lot has and may need to submit revised data slightly different absorption properties. and/or comments once the impact of To account for these differences in this variation on the test data is better absorption during the RMC understood. (Id.) AHAM recommended measurement, appendix J3 specifies a that DOE work to understand the impact procedure to determine correction of this variation on the accuracy of its factors for each lot that correlate the test data and standards analysis. (Id.) measured RMC values of the new test For example, AHAM noted that if it has cloth lot with a set of standard RMC been more difficult to meet current values established as the historical reference point. These correction factors standards due to the uncertainty in Lot 24’s correction factor, DOE will need to are applied to the RMC test results in understand whether current products appendix J and appendix J2 to ensure have been tuned to be more efficient just the repeatability and reproducibility of because of the test cloth. (Id.) AHAM test results performed using different added that this could impact DOE’s lots of test cloth. In particular, the for the covered product, if technically feasible. (42 U.S.C. 6295(gg)(2)(A)–(B)) PO 00000 Frm 00015 Fmt 4701 Sfmt 4702 E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 13534 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules analysis of more stringent standards, as some technology options may already be in use due to the correction factor issue. (Id.) AHAM also recommended that DOE conduct its own analysis of AHAM’s data, as well as the combined AHAM and DOE dataset, which should include an evaluation of the Lot 24 variation. (AHAM, No. 53 at p. 12) AHAM also commented that for some time, several manufacturers and, likely other testing laboratories, have experienced delays in obtaining test cloth. (AHAM, No. 53 at p. 5) AHAM further explained that delays in obtaining test cloth mean that some companies need to ration testing and may not be able to do testing other than certification and/or audit testing until test cloth is received. (Id.) AHAM added that it will therefore take more time for AHAM and its members to provide test results to support DOE’s rulemaking efforts related to clothes washers and clothes dryers. (Id.) AHAM requested that DOE ensure it does not move so quickly that its analysis (and manufacturers’ comments) are unable to account for these test cloth challenges. (Id.) DOE is acutely aware of the issues regarding variation in Lot 24 and is participating in the AHAM test cloth task force to help determine the root causes of the observed variation and to develop solutions to mitigate these concerns for Lot 24 as well as for future test cloth lots. Subsequent to the submission of AHAM’s comment, the AHAM test cloth task force determined to divide Lot 24 into four distinct ‘‘sublots,’’ each with its own correction factors developed using the process specified by appendix J3. DOE has added these sub-lot correction factors to the RCW test report template published on the DOE website.23 Establishing these separate sub-lots, each with separate correction factors, has mitigated much of the concern regarding variability throughout Lot 24. DOE is aware that the task force continues to investigate the extent to which any variability that remains within each sublot can be further mitigated, and DOE continues to participate in those efforts. With regard to delays in obtaining test cloth, DOE is aware that the causes of delay have largely been addressed and that the test cloth supplier is currently working to fulfill the backlog of test cloth orders. 23 DOE’s test report templates are available at energy.gov/eere/buildings/standardized-templatesreporting-test-results. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 4. Other Test Procedure-Related Comments In response to the September 2021 Preliminary Analysis and the April 2022 NODA, a number of stakeholders made comments pertaining to the clothes washer test procedure, many of which DOE subsequently addressed in the June 2022 TP Final Rule. Comments regarding certain test procedure issues that were not discussed in the June 2022 TP Final Rule are summarized in the paragraphs that follow. Addressing test procedure concerns is outside the scope of this energy conservation standards rulemaking; however, DOE encourages stakeholders to resubmit these comments during the next clothes washer test procedure rulemaking. AHAM commented in opposition to DOE’s decision to change the FMC assumption from 4 percent in appendix J2 to 2 percent in appendix J. (AHAM, No. 53 at p. 12) AHAM stated that the change in FMC assumption from 4 to 2 percent will overstate the impact of drying energy and will likely drive many clothes washer designs to increase spin speeds and spin times beyond an acceptable level. (Id.) AHAM expressed concern that this could change a clothes washer’s core functionality into a water extractor, and in effect, remove the consumer functionality of washing the clothes. (Id.) AHAM commented that the test procedure should not drive design changes of this magnitude, and added that this change will limit the opportunity in the energy conservation standards rulemaking for technologically feasible and cost efficient improvements because there are limits on how much spin speeds can increase before the chassis needs to be redesigned or before safety and consumer utility are impacted. (Id.) AHAM commented that if DOE moves forward with changing FMC from 4 to 2 percent, it must address the impact of the apparent mismatch between clothes washer drying energy and total percycle electric dryer energy consumption defined in the clothes dryer test procedures at 10 CFR part 430, subpart B, appendix D2 (‘‘appendix D2’’) or 10 CFR part 430, subpart B, appendix D1 (‘‘appendix D1’’). (AHAM, No. 53 at p. 13) AHAM further explained that currently, the drying impact of a clothes washer is significantly over-credited as a result of the mismatch in clothes loads between the clothes washer and clothes dryer test procedures. (Id.) For example, AHAM noted that the average weight of the load in appendix J can be nearly 50 percent greater than the weight of a load in the clothes dryer test procedure. (Id.) AHAM stated that according to the PO 00000 Frm 00016 Fmt 4701 Sfmt 4702 clothes washer test procedure, the annual weight to dry for a 6 ft3 clothes washer is 2,917 pounds per year, whereas the annual weight to dry according to the clothes dryer test procedure is 1,994 pounds per year, despite the units being a matching pair. (Id.) AHAM commented that it acknowledges that this difference makes sense because consumers do not dry in the clothes dryer all the clothes they wash in the clothes washer. (Id.) However, AHAM emphasized that lowering the FMC to 2 percent for clothes washer exacerbates this mismatch in energy contribution. (Id.) ASAP et al. commented that both DOE’s recent analysis for clothes dryers and real-world data suggest that drying energy usage in the clothes washers analysis is being underestimated and encouraged DOE to update its drying energy use calculations in the test procedure to better align with DOE’s clothes dryers analysis and real-world energy usage. (ASAP et al., No. 37 at pp. 3–4) ASAP et al. noted that in the September 2021 Preliminary TSD, DOE stated that drying energy use represents 75 to 83 percent of total energy usage. (Id.) ASAP et al. therefore commented that changes in drying energy estimates can have a significant impact on overall energy savings and economic analysis. (Id.) ASAP et al. emphasized that, based on DOE’s April 2021 Clothes Dryers Preliminary TSD,24 the active-mode energy use of a clothes dryer is between 67 and 93 percent greater than the estimated drying energy usage presented in the September 2021 Preliminary TSD for top-loading standard-size and frontloading clothes washers, respectively.25 (Id.) ASAP et al. further commented that the clothes dryer analysis more closely agrees with real-world clothes dryer energy use estimates from data from the Energy Information Administration’s (‘‘EIA’s’’) 2015 Residential Energy Consumption Survey (‘‘RECS 2015’’),26 which estimates 776 kWh per year, and NEEA’s Dryer Field Study published in 2014 (‘‘NEEA’s Dryer Field Study’’),27 which estimates 915 kWh per year. (Id.) ASAP et al. therefore commented that higher, more realistic drying energy 24 Available online at www.regulations.gov/ document/EERE-2014-BT-STD-0058-0016. 25 ASAP et al. based this estimate on energy use of 700 kWh/year for clothes dryers, 419 kWh/year for top-loading clothes washers and 362 kWh/year for front-loading clothes washers. 26 U.S. Department of Energy—Energy Information Administration, Residential Energy Consumption Survey: 2015 Public Use Data Files, 2015. Available at www.eia.doe.gov/emeu/recs/ recspubuse15/pubuse15.html. 27 Dryer Field Study, 2014. Northwest Energy Efficiency Alliance. Available online at neea.org/ resources/rbsa-laundry-study. E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules ddrumheller on DSK120RN23PROD with PROPOSALS2 usage estimates should further improve the cost-effectiveness of higher efficiency clothes washers that reduce drying energy use. (Id.) Ameren et al. encouraged DOE to mathematically adjust RMC to account for the drying energy of 100 percent cotton textiles using the relationship established in the 2020 NEEA report 28 that analyzed the RMC of two types of test loads across a broad range of RCW efficiency levels and technology types: the 100-percent cotton load specified in AHAM’s HLW–1–2013 test procedure and the 50/50 cotton-polyester momie weave test cloth specified in appendix J2 and appendix J. (Ameren et al., No. 42 at pp. 12–13) The NEEA report also developed a linear mathematical relationship between the two types of load. (Id.) Ameren et al. found that this relationship has an R-squared value close to 1 and determined that it could be used to adjust the measured RMC of an appendix J2 test load to the expected RMC when using an AHAM load. (Id.) Ameren et al. stated that adjusting the RMC of an appendix J2 test load to an RMC typical of 100 percent cotton textiles would more realistically account for RCW impacts on drying energy use. (Id.) Ameren et al. further commented that most typical laundry loads have a much higher cotton content, which they asserted means that mathematically adjusting the RMC before calculating drying energy would better account for typical energy use. (Id.) Ameren et al. also commented that adjusting the RMC of appendix J2 textiles to an RMC typical of 100 percent cotton textiles would increase the alignment between the September 2021 Preliminary TSD’s clothes washer drying energy use calculation and the measured appendix D2 clothes dryer energy use. (Id.) Ameren et al. added that while other constants such as DEF 29 in appendix J2 and appendix J are relatively consistent with most appendix D1 and D2 dryer measurements, the typical drying energy calculated in the existing appendix J2 clothes washer test procedure is much lower than the energy consumed by a conventional clothes dryer tested by appendix D1 or D2. (Id.) Ameren et al. further explained that the clothes dryer test procedures use an initial moisture 28 Foster Porter, Suzanne; Denkenberger, Dave. 2020. Coming Clean: Revealing Real-World Efficiency of Clothes Washers. Portland, OR. Northwest Energy Efficiency Alliance. Available online at: neea.org/resources/comingcleanrevealing-real-world-efficiency-of-clotheswashers. 29 ‘‘DEF’’ is defined in section 4.3 of appendix J2 and section 4.4 of appendix J as the nominal energy required for a clothes dryer to remove moisture from clothes and is set equal to 0.5 kWh/lb. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 content of 57.5 percent for the clothes dryer test load, and using NEEA’s mathematical adjustment to increase RMC before calculating drying energy would make the drying energy calculated in appendix J2 and J more similar to the drying energy calculated in appendix D1 and D2. (Id.) ASAP et al. commented that one potential partial explanation for the apparent underestimation of drying energy usage in the clothes washer analysis is the estimate for DEF. (ASAP et al., No. 37 at p. 4) ASAP et al. noted that while DOE assumes a DEF of 0.5 kWh per pound of moisture removed from clothes, ASAP et al. estimated a higher nominal DEF of about 0.6 kWh per pound of moisture removed using weighted-average clothes dryer efficiency ratings and parameters from the clothes dryers test procedure. (Id.) ASAP et al. also commented that a 2022 NEEA study 30 suggests that even the clothes dryer test procedure can underestimate drying energy usage, particularly when a non-ENERGY STAR-rated top-loading clothes washer is paired with a non-ENERGY STAR electric dryer. (Id.) ASAP et al. further noted that the Northwest Regional Technical Forum’s most recent estimate for DEF is 0.65 kWh per pounds of moisture removed.31 (Id.) As discussed, DOE is not addressing test procedure changes in this energy conservation standards rulemaking. DOE notes that FMC and the drying energy calculations were specifically addressed in section III.G.2 of the June 2022 TP Final Rule. 87 FR 33316, 33353–33354. D. Technological Feasibility 1. General In each energy conservation standards rulemaking, 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 30 Perfect Pairings? Testing the Energy Efficiency of Matched Washer-Dryer Sets, 2022. Northwest Energy Efficiency Alliance. Available online at neea.org/resources/perfect-pairings-testing-theenergy-efficiency-of-matched-washer-dryer-sets. 31 Regional Technical Forum, Residential Clothes Washers, 2021. ‘‘Residential Clothes Washers v7.1.’’ Available online at rtf.nwcouncil.org/measure/ clothes-washers-0. PO 00000 Frm 00017 Fmt 4701 Sfmt 4702 13535 technologies incorporated in commercially-available products or in working prototypes to be technologically feasible. Sections 6(b)(3)(i) and 7(b)(1) of the Process Rule. 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 the Process Rule. Section IV.B of this document discusses the results of the screening analysis for RCWs, 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 RCWs, 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 of this proposed rule and in chapter 5 of the NOPR TSD. E. Energy Savings 1. Determination of Savings For each trial standard level (i.e., TSL), DOE projected energy savings from application of the TSL to RCWs purchased in the 30-year period that begins in the year of compliance with the proposed standards (2027–2056).32 The savings are measured over the entire lifetime of RCWs purchased in the previous 30-year period. DOE quantified the energy savings 32 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. E:\FR\FM\03MRP2.SGM 03MRP2 13536 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules 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’’) and national water savings (‘‘NWS’’) from potential amended or new standards for RCWs. 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.33 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. ddrumheller on DSK120RN23PROD with PROPOSALS2 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. (42 U.S.C. 6295(o)(3)(B)) 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.34 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 33 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). 34 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). VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 pronounced than products with relatively constant demand. 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.1 of this document, DOE is proposing to adopt TSL 4, which would save an estimated 1.45 quads of energy (FFC) over 30 years. 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). F. Economic Justification 1. Specific Criteria As noted previously, EPCA provides seven factors to be evaluated in determining whether a potential energy conservation standard is economically justified. (42 U.S.C. 6295(o)(2)(B)(i)(I)– (VII)) The following sections discuss how DOE has addressed each of those seven factors in this proposed 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 PO 00000 Frm 00018 Fmt 4701 Sfmt 4702 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 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 E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules 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.E 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 proposed rulemaking. ddrumheller on DSK120RN23PROD with PROPOSALS2 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 VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 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 associated with energy production and use. DOE conducts an emissions analysis to estimate how potential standards may 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 climate and health benefits from certain emissions reductions resulting from the considered TSLs, as discussed in section IV.L of this document. 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 PO 00000 Frm 00019 Fmt 4701 Sfmt 4702 13537 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 proposed rule. IV. Methodology and Discussion of Related Comments This section addresses the analyses DOE has performed for this rulemaking with regard to RCWs. Separate subsections 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-2017-BT-STD-0014. Additionally, DOE used output from the latest version of the 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 E:\FR\FM\03MRP2.SGM 03MRP2 13538 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules trends; and (6) technologies or design options that could improve the energy efficiency of RCWs. 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. 1. Product Classes When evaluating and establishing energy conservation standards, DOE may establish separate standards for a group of covered products (i.e., establish a separate product class) if DOE determines that separate standards are justified based on the type of energy used, or if DOE determines that a product’s capacity or other performance-related feature justifies a different standard. (42 U.S.C. 6295(q)) In making a determination whether a performance-related feature justifies a different standard, DOE must consider factors such as the utility of the feature to the consumer and other factors DOE determines are appropriate. (Id.) DOE currently defines separate energy conservation standards for four RCW product classes (10 CFR 430.32(g)(4)): • Top-loading, compact (less than 1.6 ft3 capacity) • Top-loading, standard-size (1.6 ft3 or greater capacity) • Front-loading, compact (less than 1.6 ft3 capacity) • Front-loading, standard-size (1.6 ft3 or greater capacity) In the September 2021 Preliminary Analysis, DOE analyzed four potential product classes for RCWs using a threshold of 3.0 ft3 to differentiate between compact and standard-size front-loading RCWs, in contrast to the existing threshold of 1.6 ft3, resulting in the following product classes being analyzed: ddrumheller on DSK120RN23PROD with PROPOSALS2 • Top-loading, compact (less than 1.6 ft3 capacity) • Top-loading, standard-size (1.6 ft3 capacity or greater) • Front-loading, compact (less than 3.0 ft3 capacity) • Front-loading, standard-size (3.0 ft3 capacity or greater) As noted in chapter 2 of the September 2021 Preliminary TSD, there are no front-loading RCWs with a capacity less than 1.6 ft3 certified to DOE, indicating that the current threshold of 1.6 ft3 may no longer be a relevant differentiator of capacity within the front-loading RCW market. Based on front-loading RCW models certified in DOE’s Compliance Certification VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 Database (‘‘CCD’’),35 DOE identified a gap in front-loading capacity between 2.8 ft3 and 3.4 ft3 (i.e., no products are available on the market within this range). The capacity gap is directly related to cabinet size—capacities less than 2.8 ft3 correspond to a 24-inch cabinet width, and capacities larger than 3.4 ft3 correspond to a 27-inch cabinet width. In the September 2021 Preliminary Analysis, DOE evaluated an updated capacity threshold of 3.0 ft3 between compact-size and standard-size to align more closely with product differentiation in the market. In the September 2021 Preliminary Analysis, DOE requested comment on whether it should revise the definitions of the front-loading product classes by increasing the capacity threshold of the front-loading compact product class to 3.0 ft3. DOE also requested comment on whether any other changes to product class definitions are warranted. Prior to the May 2012 Final Rule, DOE also defined a separate RCW product class for top-loading semi-automatic clothes washers. Semi-automatic clothes washers are designed to be intermittently attached to a kitchen or bathroom faucet and require user intervention to regulate the water temperature by adjusting the external water faucet valves. Top-loading semiautomatic clothes washers were subject to a design standard requiring an unheated rinse water option, as established by the National Appliance Energy Conservation Act of 1987, Public Law 100–12 (‘‘NAECA’’). NAECA amended EPCA to require that all rinse cycles of RCWs shall include an unheated water option, but may have a heated water rinse option, for products manufactured on or after January 1, 1988. In the May 2012 Final Rule, DOE eliminated the top-loading semiautomatic product class distinction, having determined based on its market research and comments submitted by AHAM and three manufacturers that such products were no longer available on the market. 77 FR 32308, 32317. The top-loading standard-size levels that were established in the May 2012 Final Rule were based on consideration of only top-loading automatic clothes washers. In chapter 2 of the September 2021 Preliminary TSD, DOE discussed that it is now aware of multiple top-loading semi-automatic clothes washers on the market, from multiple manufacturers. DOE stated that it was considering 35 DOE’s Compliance Certification Database is available at www.regulations.doe.gov/certificationdata. PO 00000 Frm 00020 Fmt 4701 Sfmt 4702 whether it should reinstate an RCW product class definition for top-loading semi-automatic clothes washers, and whether it should consider a performance-based standard rather than the design standard established by EPCA as amended. DOE noted, however, that because the user of a semi-automatic clothes washer controls the water temperature by adjusting the external water faucet valves, semiautomatic clothes washers inherently provide the option for an unheated rinse. Therefore, DOE believes that a design standard that requires an unheated rinse option may be superfluous for semi-automatic clothes washers. In the September 2021 Preliminary Analysis, DOE requested comment on whether it should reinstate a product class definition for top-loading semiautomatic clothes washers. DOE requested comment on its preliminary conclusion that that a design standard that requires an unheated rinse option may be superfluous for semi-automatic clothes washers. AHAM presented data indicating the shipment weighted average capacity for clothes washers from 1981–2020. (AHAM, No. 40 at pp. 13–14) Based on this data, AHAM commented that a reassessment of the ‘‘compact’’ definition would be justified since clothes washer capacities in general have increased from an average of 2.63 ft3 in 1990 to 4.25 ft3 in 2020. (Id.) AHAM recommended that DOE change the definition of the compact product class in order to retain consumer utility of smaller-capacity and smaller-width products for consumers. (AHAM, No. 40 at pp. 13–15) AHAM recommended that DOE add an upper width limit of 24 inches in the proposed compact product class definition, such that a top-loading or front-loading compact product would either have a capacity less than 1.6 ft3, or a width less than or equal to 24 inches. (Id.) AHAM also commented that typically, based on a review of retailer websites, products advertised as ‘‘compact’’ or ‘‘portable’’ today appear to be under 1.6 ft3 or 24 inches in width or less. (Id.) AHAM commented that it agrees with DOE’s assessment that products with smaller widths and capacities provide a utility to consumers since they can be used in smaller spaces, can be moved more easily from place-to-place, or can be used together with a standard-size clothes washer. (Id.) AHAM also agrees with DOE’s acknowledgement that these products, due to their smaller size, cannot achieve the same levels of efficiency as larger products due to technological limitations such as drum E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules diameter and capacity, or due to being geared toward niche consumer usage such as portability or an add-on to a standard-size clothes washer. (Id.) Whirlpool commented that it agrees with DOE’s proposal to change the threshold for the front-loading compact product class and suggested that DOE make further product class changes. (Whirlpool, No. 39 at p. 19) Whirlpool specifically suggested that DOE change the definition of compact clothes washers to be based on product width, corresponding to how they are marketed to consumers as compact or standard size. (Id.) Whirlpool added that clothes washers with 24-inch widths and smaller are overwhelmingly marketed as ‘‘compact,’’ regardless of their capacity. (Id.) Whirlpool also recommended that for standard-size clothes washers, DOE separate the standard-size product class into three product classes: standard, small (≤4.0 ft3); standard, medium (>4.0 ft3 to ≤5.0 ft3); and standard, large (>5.0 ft3 and above). (Whirlpool, No. 39 at p. 19) Whirlpool commented that there are numerous performance, technology, efficiency, and consumer-relevant differences between clothes washers in Whirlpool’s suggested product classes. (Id.) Whirlpool further explained that entry-level price point clothes washers generally have capacities less than or equal to 4 ft3 and that the smaller diameter wash baskets of these units create challenges in driving water extraction. (Id.) Whirlpool added that these clothes washers also have shorter cycle times and more basic feature sets and controls. (Id.) Whirlpool added that even with a removal of the capacity benefit in the EER and WER efficiency metrics, there are still other technological challenges for clothes washers with smaller cabinet widths since spatial limitations prevent adding technologies that increase efficiency, including larger motors and larger wash baskets to increase spin speed. (Whirlpool, No. 39 at p. 19) The CA IOUs commented that adjustments to increase the size of the front-loading compact product class are not warranted, and added that they are instead supportive of an equation-based metric that can account for the efficiency differences related to capacity. (CA IOUs, No. 43 at pp. 3–4) The CA IOUs added that they believe the definition of standard-size versus compact product classes artificially segments the data, and that performance is correlated with capacity without a clear delineation. (Id.) The CA IOUs expressed three primary concerns related to the changes to the product class definitions. (Id.) First, the CA IOUs VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 commented that the proposed changes to capacity definitions would create a different definition of ‘‘compact’’ for top- and front-loading RCWs, which the CA IOUs asserted would add confusion to the market. (Id.) Second, the CA IOUs commented that there likely remains an inherent relationship between capacity and performance in the test procedure, which is insufficiently represented by the two large discrete product class groupings of compact size and standard size. (Id.) The CA IOUs noted that there was significant interest from stakeholders in response to the August 2019 RFI for DOE to consider narrower capacity ranges to facilitate a separate analysis for larger clothes washers. (Id.) The CA IOUs commented that, while they believe this may result in some statistical improvement in the original analysis, they would prefer an equationbased standard that can correct for the continuum of product capacities. (Id.) The CA IOUs also specified that creating more narrow capacity ranges may have unintended consequences of incentivizing manufacturers to produce products in one capacity size over another due to less stringent efficiency standards in neighboring classes. (Id.) Third, the CA IOUs commented that while DOE can use capacity or another ‘‘performance related’’ feature to justify a higher or lower standard under EPCA, the CA IOUs expressed concern regarding the arbitrary nature of the capacity definitions, particularly for front-loading clothes washers. (Id.) The CA IOUs added that under the appendix J2 efficiency metrics, product efficiencies strongly varied with capacity and may continue to do so under the appendix J efficiency metrics. (Id.) The CA IOUs commented that a more appropriate approach would be to use an equation-based standard with a capacity, similar to what is used under the consumer refrigerators/refrigeratorfreezers/freezers standard. (Id.) Ameren et al. commented that while they do not have a specific recommendation for the compact RCW definition, they encourage DOE to ensure that changing the compact product class to incorporate larger capacities does not enable backsliding. (Ameren et al., No. 42 at p. 18) Ameren et al. commented that DOE’s working definition of less than 1.6 ft3 for toploading clothes washers and less than 2.5 ft3 for front-loading clothes washers would not result in backsliding because there is not a front-loading product less than 1.6 ft3 on the market. (Id.) However, Ameren et al. noted that, if defined differently, RCW models presently considered standard-sized PO 00000 Frm 00021 Fmt 4701 Sfmt 4702 13539 (and therefore subject to a higher efficiency standard) could be recategorized as compact (and therefore subject to a lower efficiency standard). (Id.) As discussed, currently, no frontloading products with a capacity less than 1.6 ft3 are certified to DOE as being available on the market, indicating that the current threshold of 1.6 ft3 is no longer a relevant differentiator of capacity within the front-loading RCW market. DOE analysis tentatively confirms AHAM and Whirlpool’s comments that despite the removal of the capacity ‘‘bias’’ in the EER and WER efficiency metrics, the reduced dimensions of smaller-width products limit the use of certain technologies for increasing efficiency, such as larger wash baskets that can exert a higher g-force on clothing. For this reason, DOE tentatively concludes that a separate product class is warranted for spaceconstrained front-loading RCWs at a revised threshold that is more relevant to the current market. DOE recognizes that one of the defining characteristics of front-loading RCWs marketed as ‘‘compact’’ is the width-constrained design (i.e., the ability for the clothes washer to be installed in narrow space that would not accommodate a full-size clothes washer). DOE considered defining the front-loading compact-size product classes on the basis of width. Based on DOE’s market research, and supported by comments from AHAM and manufacturers, products marketed as ‘‘compact’’ typically have a nominal cabinet width of 24-inches, whereas full-size products most typically have a nominal cabinet width of 27 inches. DOE has identified a number of practical challenges in basing the product class distinction on a measurement of the width of a clothes washer. The test procedure would need to require measuring the width of the clothes washer and would need to specify how the measurement would be performed. While DOE could consider such amendments to its test procedure, DOE has identified nuances in product design that could create complexities in defining such a measurement. For example, on front-loading clothes washers, DOE has observed that certain aesthetic features, such as the borders of the control panel, may extend beyond the width of the main body of the cabinet. In general, certain measurements of width may not provide an appropriate representation of product width as it relates to product class designation. DOE also notes that although front-loading clothes washers are most often marketed according to E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 13540 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules their nominal width as a whole number, the actual width may be a fraction of an inch higher or lower than the advertised nominal width. Furthermore, DOE is concerned that by defining the ‘‘compact-size’’ threshold as a width equal to or less than 24 inches, for example, if a manufacturer were to bring to market a 25-inch width product, such a product would be defined as standardsize but would presumably share many of the same inherent efficiency constraints as a 24-inch product (i.e., a 25-inch product may be more appropriately classified as compact-size rather than standard-size). Having considered these challenges in defining the front-loading compact-size threshold on the basis of product width, DOE further considered defining the threshold based on an updated capacity value that would be more relevant to the current market than the existing threshold of 1.6 ft3. Based on frontloading RCW models currently certified in DOE’s CCD, there is a gap in frontloading capacity between 2.8 ft3 and 3.4 ft3 (i.e., no products are available on the market within this range), consistent with DOE’s findings presented in the September 2021 Preliminary TSD. DOE evaluated every front-loading model in the CCD and has determined that this capacity gap directly correlates with nominal cabinet size—capacities less than 2.8 ft3 correspond to a nominal 24inch cabinet width, and capacities larger than 3.4 ft3 correspond to a nominal 27inch cabinet width or greater. Based on this analysis, DOE tentatively concludes that for front-loading RCWs, using a capacity threshold rather than a width threshold would provide a perfectly correlated proxy for differentiating between standard-size products and space-constrained products. DOE therefore proposes to define a threshold of 3.0 ft3 to differentiate between compact-size and standard-size frontloading RCWs. DOE further notes that given the current gap in capacity between 2.8 ft3 and 3.4 ft3 for units currently on the market, defining the threshold at 3.0 ft3 would provide opportunities for manufacturers to introduce compact-size products with slightly higher capacity, or standard-size products with slightly lower capacity, with such potential products being classified within the appropriate product class. DOE would consider other means for defining the threshold between the compact-size and standardsize front-loading product classes if in the future a capacity threshold were to no longer provides a clear proxy to distinguish between standard-size VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 products and space-constrained products. Specific to the front-loading standardsize product class, DOE evaluated the merits of separately defining a larger product class (e.g., greater than 5.0 ft3), as suggested by multiple commenters. Data submitted by AHAM indicates a shipment-weighted average capacity of around 4.2 ft3 for all RCWs, and the results of the engineering analysis indicate that a capacity of 4.2 ft3 is representative of the baseline efficiency level for the standard-size front-loading product class. DOE’s testing and teardown analysis indicates that all of the evaluated efficiency levels for the standard-size front-loading product class can be achieved by units at 4.2 ft3 capacity (i.e., an increase in capacity is not required as a means for achieving the higher efficiency levels analyzed). On this basis, DOE tentatively determines that additional capacitybased product classes within the standard-size front-loading product class are not warranted. For top-loading clothes washers, DOE proposes in this NOPR to maintain the existing ‘‘compact’’ and ‘‘standard’’ product class distinctions (i.e., using a capacity threshold of 1.6 ft3 to differentiate the two classes); however, DOE continues to consider alternative approaches as discussed further in the paragraphs that follow and in chapter 3 and chapter 5 of the NOPR TSD. Unlike for front-loading RCWs, toploading compact-size products are available on the market at capacities less than 1.6 ft3 (i.e., the current threshold). Considering only automatic top-loading clothes washers,36 those with capacity less than 1.6 ft3 are exclusively heightconstrained ‘‘companion’’ clothes washers, which are designed to serve as an auxiliary clothes washer for washing a small or delicate load while simultaneously washing a ‘‘normal’’ load in the accompanying standard-size RCW.37 Among standard-size toploading clothes washers (i.e., those with capacity equal to or greater than 1.6 ft3), DOE’s CCD indicates a relatively continuous spectrum of capacities available on the market across the entire range (i.e., no large gaps in capacity), 36 As discussed further in section IV.C.2.c of this document, the CCD includes both automatic clothes washer models and semi-automatic clothes washer models certified within the top-loading compact product class. 37 Companion clothes washers are currently available in two different configurations: (1) Integrated into (i.e., built into) the cabinet above a standard-size front-loading RCW, and (2) built into a pedestal drawer for installation underneath a standard-size front-loading RCW. Both configurations are constrained in the height dimension. PO 00000 Frm 00022 Fmt 4701 Sfmt 4702 with no apparent capacity threshold that closely correlates with product differentiation on the market. For standard-size top-loading RCWs, DOE’s engineering analysis indicates that despite the removal of capacity ‘‘bias’’ from the EER and WER metrics, increases in capacity are required to achieve higher efficiency levels beyond EL 1. (See chapter 5 of the NOPR TSD). DOE continues to consider whether this conclusion justifies separating the standard-size product class into separate product classes, as suggested by Whirlpool. Given this close relationship between efficiency and capacity, DOE also continues to consider whether to specify an equation-based standard for the top-loading standard-size product class, as suggested by the CA IOUs. Chapter 5 of the NOPR TSD provides further details of DOE’s consideration of these potential alternate product class definitions for top-loading standard-size RCWs. DOE recognizes that an equationsbased standards approach would be unfamiliar to RCW stakeholders and would significantly alter the structure of the standards analysis. As such, the analysis of potential amended standards, and how such standards would impact the existing market, could be difficult for stakeholders to interpret, particularly given the proposed change in metrics to EER and WER. DOE also recognizes that implementing equationbased standards could potentially increase compliance burden from manufacturers. For example, a simple modification made to the balance ring on a top-loading model or the door shape on a front-loading model for aesthetic purposes could change the model’s measured capacity, which would in turn change the standard applicable to that unit and would therefore require corresponding changes to the controls to reduce energy and water use. As manufacturers iterate product designs, any change that would affect a model’s measured capacity would result in the model being subject to a different standard. In addition, defining an equationbased standard for only the top-loading standard-size product class would create complexity that may lead to confusion or added regulatory burden for manufacturers. At this time, DOE tentatively determines that the increased complexity and potential burdens of an equation-based standard outweigh the benefits. As discussed, in this NOPR, DOE proposes a numerically based standard for the top-loading standardsize product class. E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules In response to the CA IOUs’ concern that having a different definition of the ‘‘compact’’ threshold for top-loading and front-loading RCWs would add confusion to the market, DOE is proposing to rename the product class for top-loading RCWs with capacities less than 1.6 ft3 as ‘‘ultra-compact.’’ In response to Ameren et al.’s comment that changing the compact product class threshold should not enable backsliding, DOE notes that, as discussed, EPCA 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)) As discussed in section IV.C.2.a of this document, DOE used the current DOE standard applicable to front-loading standard-size clothes washers as the baseline efficiency level for the newly created front-loading compact-size product class, which prevents any possibility of backsliding. Ameren et al. provided comments pertaining to portable clothes washers, which the comment equates with semiautomatic clothes washers. (Ameren et al., No. 42 at pp. 6–8). Ameren et al. commented that since the last standards rulemaking, portable RCWs are now widely available for sale through national retailers and online direct-toconsumer marketplaces. (Id.) Ameren et al. referenced NEEA research as verifying that the portable RCWs currently on the market meet or exceed current standards, and that therefore they do not require a separate product class. (Id.) Ameren et al. also commented that nothing should prevent efficient technologies employed in conventional automatic top-loading RCWs from being leveraged in portable top-loading RCWs, including wash plates and higher spin speeds. (Id.) DOE cautions that portable clothes washers 38 as a whole represent a broader category of clothes washers than semi-automatic clothes washers specifically. Although all semiautomatic clothes washers currently on the market are portable, not all portable clothes washers on the market are semiautomatic—certain portable clothes washers are automatic (i.e., they provide means for internal regulation of water temperature, as opposed to requiring the 38 In this NOPR, DOE uses the term ‘‘portable clothes washer’’ to mean a clothes washer, typically with caster wheels, designed to be easily moved by the consumer. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 user to adjust the water temperature externally to the clothes washer). With regard to Ameren et al.’s comment that portable RCWs currently on the market meet or exceed current standards and therefore do not require a separate product class, DOE does not agree that this conclusion can be applied to semi-automatic clothes washers specifically, since many of the data points referenced by Ameren et al. correspond to automatic top-loading clothes washers. In addition, appendix J includes significant changes to the testing of semi-automatic clothes washers—which improve the representativeness of the test results while reducing test burden—such that when tested under appendix J, a semiautomatic clothes washer uses significantly more hot water (and therefore has inherently lower EER values) than would a similarly-sized automatic clothes washer.39 Section IV.C.2.c of this document provides further discussion of the efficiency level analysis for semi-automatic clothes washers. Given the reemergence of semiautomatic clothes washers on the market, and improvements to the test procedure to improve the representativeness of test results for semi-automatic clothes washers, DOE is proposing to re-establish a separate product class for semi-automatic clothes washers and to establish performancebased standards for semi-automatic clothes washers. In summary, for this NOPR, DOE analyzed five product classes for RCWs as follows: • Semi-automatic clothes washers • Automatic clothes washers: 40 Æ Top-loading, ultra-compact (less than 1.6 ft3 capacity) Æ Top-loading, standard-size (1.6 ft3 or greater capacity) Æ Front-loading, compact (less than 3.0 ft3 capacity) Æ Front-loading, standard-size (3.0 ft3 or greater capacity) DOE seeks comment on the product class structure analyzed in this NOPR. 39 For example, most automatic clothes washers offer only a cold rinse, whereas appendix J requires semi-automatic clothes washers to be tested on both Hot Wash/Hot Rinse, and Warm Wash/Warm Rinse cycles, based on the assumption that the user would not adjust the water temperature during the cycle. 87 FR 33316. Significantly more hot water is used in these cycles than on the equivalent cycles (Hot Wash/Cold Rinse and Warm Wash/Cold Rinse) on an automatic clothes washer. 40 For simplicity, many of the tables in the following sections of this document omit the designation that these four product classes pertain to automatic clothes washers. PO 00000 Frm 00023 Fmt 4701 Sfmt 4702 13541 2. Technology Options In the preliminary market analysis and technology assessment, DOE identified a comprehensive list of technology options that would be expected to improve the efficiency of RCWs, as measured by the DOE test procedures.41 Initially, these technologies encompass all those that DOE believes are technologically feasible. In the September 2021 Preliminary Analysis, DOE requested information on any technology options not identified in the September 2021 Preliminary TSD that manufacturers may use to attain higher efficiency levels of RCWs. Ameren et al. commented in support of DOE’s inclusion of all relevant technologies, including those to reduce drying energy. (Ameren et al., No. 42 at p. 19) Ameren et al. also commented that they appreciate DOE’s consideration of technologies that have been found in working prototypes in addition to those available in current models. (Id.) In this NOPR, DOE considered the technology options listed in Table IV.1. In addition to the technology options DOE considered for the September 2021 Preliminary Analysis, DOE added capacity increase as a technology option for this NOPR.42 TABLE IV.1—TECHNOLOGY OPTIONS FOR RESIDENTIAL CLOTHES WASHERS Methods for Decreasing Water Use: * Adaptive water fill controls. Hardware features enabling lower water levels. Spray rinse. Polymer bead cleaning. Methods for Decreasing Machine Energy: More efficient motor. Direct drive motor. Methods for Decreasing Water Heating Energy: Wash temperature decrease. Ozonated laundering. Methods for Decreasing Drying Energy: Hardware features enabling spin speed increase. Spin time increase. Methods for Decreasing Standby Energy: Lower standby power components. Methods for Increasing Overall Efficiency: Capacity increase. * Most of the methods for decreasing water use are also methods for decreasing water heating energy, since less hot water is used. 41 See section 3.15.2 of the September 2021 Preliminary TSD. Available online at www.regulations.gov/document/EERE-2017-BTSTD0014-0030. 42 In this NOPR, DOE considers capacity increase only as a technology option of ‘‘last resort.’’ In defining a representative ‘‘path’’ that manufacturers would be expected to use to achieve higher efficiency levels, DOE included capacity increase only for those efficiency levels that cannot be reasonably achieved without an increase in capacity. See chapter 5 of the NOPR TSD for more details. E:\FR\FM\03MRP2.SGM 03MRP2 13542 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules ddrumheller on DSK120RN23PROD with PROPOSALS2 Chapter 3 of the NOPR TSD includes the detailed descriptions of each technology option. DOE seeks comment on the technology options not identified in this NOPR that manufacturers may use to attain higher efficiency levels of RCWs. 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 commercially viable, existing prototypes will not be considered further. (2) Practicability to manufacture, install, and service. If it is determined that mass production of a technology in commercial products and reliable installation and servicing of the technology 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. If a technology is determined to have a significant adverse impact on the utility of the product to subgroups of consumers, or 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) Safety of technologies. 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 proprietary technology has proprietary protection and represents a unique pathway to achieving a given efficiency level, it will not be considered further due to the potential for monopolistic concerns. 10 CFR part 430, subpart C, appendix A, sections 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 VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 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 In chapter 4 of the September 2021 Preliminary Analysis, DOE screened out electrolytic disassociation of water, ozonated laundering, and polymer bead cleaning on the basis of their practicability to install, manufacture and service. DOE also noted that electrolytic disassociation of water could have impacts on product utility or availability and that polymer bead cleaning was a unique-pathway proprietary technology. In the September 2021 Preliminary Analysis, DOE sought comment on whether any additional technology options should be screened out on the basis of any of the screening criteria. AHAM commented that decreasing water temperature, particularly on the warmest warm wash temperature, could decrease cleaning and rinsing performance by making it harder to remove fatty soils, which are soluble around 85 degrees Fahrenheit (‘‘°F’’). (AHAM, No. 40 at pp. 9–10) AHAM added that despite the existence of some detergents designed for lower temperatures, detergents alone cannot solve this issue. (Id.) AHAM commented that decreased water temperature could also have negative impacts on fabric care resulting from reduced detergent removal, biofilm accumulation, reduced particulate removal, and increased white residues on clothing. (Id.) AHAM also noted that if wash time is increased to compensate for a decrease in cleaning performance at lower wash temperatures, the cycle time will consequently increase. (Id.) Whirlpool suggested that lowering wash temperatures from current levels should not be a technology option considered by DOE. (Whirlpool, No. 39 at pp. 6–8) Whirlpool added that it strongly believes that wash temperatures are already low enough, and that lowering temperatures further will effectively create a disconnect between consumer perceptions of acceptable wash water temperatures and what Whirlpool could actually offer. (Id.) Whirlpool commented that this impact is compounded by the proposed appendix J test procedure, which proposes to test the hottest and coldest Warm Wash/Cold Rinse settings for all clothes washers instead of using the 25/ 50/75 test.43 (Id.) Whirlpool commented 43 The ‘‘25/50/75’’ test refers to the provision in section 3.5 of appendix J2 that allows a clothes PO 00000 Frm 00024 Fmt 4701 Sfmt 4702 that changing the test procedure at the same time as the energy conservation standards may impede Whirlpool’s ability to offer warm wash temperatures that consumers find acceptable and could affect clothes washers’ ability to consistently clean laundry to the consumers’ satisfaction, since higher temperatures are needed to effectively remove fatty soils, white residue, and particulates from laundry. (Id.) Whirlpool further commented that DOE’s standards should not drive wash water temperatures below levels that are acceptable based on consumer perceptions of these temperatures. (Id.) Whirlpool recommended that instead, DOE’s standards should protect the ability of clothes washers to offer adequate wash temperatures that align with consumer expectations and can deliver on the core purpose of owning and using a clothes washer, which is to remove soils and clean clothes. (Id.) Whirlpool noted that the overall impact of lowering wash temperature on improving efficiency is minimal in comparison to other technology options like improving spin speed, but it is still something manufacturers must consider when making tradeoffs between cost and efficiency when designing a clothes washer to meet new standards. (Id.) Whirlpool further commented that detergents become less effective at lower wash temperatures, and that consumers will see this reduction immediately or within several loads, depending on the soil type on the clothing. (Whirlpool, No. 39 at p. 11) Whirlpool added that even detergents formulated specifically for cold water washing may not be validated for temperatures below 70 °F. (Id.) Whirlpool noted that in northern states such as Michigan, yearly ground water temperatures are in the 42–49 °F range, and that Whirlpool is not aware of any detergent that was formulated and validated for performance at temperatures that low. (Id.) Whirlpool stated that many clothes washers on the market today have tap cold options, and some have a variety of cold and cool temperatures that mix in some amount of hot water. (Id.) Whirlpool commented that some clothes washers offer these temperatures in the 55 °F range. (Id.) Whirlpool expressed concern that, due to any amendments to the standards that necessitate a reduction in wash washer that has four or more Warm Wash/Cold Rinse temperature selections to be tested at the 25percent, 50-percent, and 75-percent positions of the temperature selection device between the hottest hot (≤135 °F (57.2 °C)) wash and the coldest cold wash. If a selection is not available at the 25-, 50or 75-percent position, in place of each such unavailable selection, the next warmer temperature selection shall be used. E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules temperatures, the temperature range of these tap cold, cold, and cool settings may be driven down well below the validated temperatures for good performance for even the best detergent formulations on the market. (Id.) Whirlpool added that this problem would be even more pronounced for the cheaper and less effective detergents, which may be popular with low-income consumers. (Id.) Whirlpool concluded that detergents would need to be reformulated to reflect this broad-scale lowering of wash temperatures in clothes washers, and Whirlpool is not sure if it would be possible to validate a detergent for good performance at these lower temperatures. (Id.) Unlike certain other discrete technology options evaluated by DOE (e.g., direct drive motor), wash temperature decrease can be implemented to varying extents. For example, some manufacturers may implement it to small extent (e.g., a decrease by 0.5 °F), whereas other manufacturers may implement it to a significantly larger extent (e.g., a decrease of 5 °F or more). In addition, DOE observes through testing that manufacturers employ a wide variety of ‘‘paths’’ to achieve higher efficiency levels—some manufacturers may opt to reduce wash temperatures as a means for achieving a particular efficiency level, whereas other manufacturers may prioritize maintaining wash temperatures and instead reducing motor energy use or drying energy. Indeed, through its testing, as discussed in a test report accompanying this NOPR (hereafter, the ‘‘performance characteristics test report’’), which is available in the docket for this rulemaking, DOE has observed a wide range of wash temperatures available on the market among products with identical efficiency ratings. Because of this variation in implementation from manufacturer to manufacturer, and because DOE observes that some manufacturers choose a ‘‘path’’ to higher efficiency that includes reduced wash temperatures, DOE has not screened out decreased wash temperatures as a design option for improving efficiency. In chapter 5 of the NOPR TSD, section 5.5.3 describes the design option paths most typically associated with each analyzed efficiency level within each product class, based on DOE’s testing and teardowns of a representative sample of units on the market. For the top-loading standard-size product class, the design option path considered by DOE for the analysis incorporates a slight reduction in hot wash water temperatures at EL 3 and a more substantive reduction in hot wash water VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 temperatures at EL 4, reflecting the most prevalent design option path used by units currently on the market at these ELs. Although the most typical design option path includes reduced wash temperatures, DOE’s analysis described in the performance characteristics test report suggests that the proposed efficiency level (in particular, EL 3 for the top-loading standard-size product class) can be achieved through a variety of design option paths, including paths that do not require a substantive reduction in wash temperatures compared to the range of wash temperatures provided by lowerefficiency units. Such design option paths could incorporate more efficient motors or higher spin speeds, for example, in lieu of any reductions in wash water temperatures. Such alternate design option paths would have higher manufacturing costs than a path that uses reduction in wash water temperatures. Additionally, for this NOPR analysis, DOE partially screened out capacity increase as a technology option. Specifically, DOE screened out any capacity increase that would require a corresponding increase in cabinet width larger than 27 inches, on the basis of the practicability to install and service RCWs with cabinet widths larger than 27 inches. DOE recognizes that products with a width greater than 27 inches may not be able to fit through many standards-size interior doorways. For the reasons discussed in chapter 4 of the NOPR TSD, for this NOPR analysis DOE screened out ozonated laundering, and polymer bead cleaning on the basis of their practicability to install, manufacture and service. DOE seeks comment on whether any additional technology options should be screened out on the basis of any of the screening criteria in this NOPR. 2. Remaining Technologies Through a review of each technology, DOE retained (i.e., did not screen out) the technology options listed in Table IV.2 and tentatively concludes that each of these technologies meets all five screening criteria to be examined further as design options. TABLE IV.2—RETAINED DESIGN OPTIONS FOR RESIDENTIAL CLOTHES WASHERS Methods for Decreasing Water Use: * Adaptive water fill controls. Hardware features enabling lower water levels. Spray Rinse. Methods for Decreasing Machine Energy: More efficient motor. Direct drive motor. Methods for Decreasing Water Heating Energy: PO 00000 Frm 00025 Fmt 4701 Sfmt 4702 13543 TABLE IV.2—RETAINED DESIGN OPTIONS FOR RESIDENTIAL CLOTHES WASHERS—Continued Wash temperature decrease. Methods for Decreasing Drying Energy: Hardware features enabling spin speed increase. Spin time increase. Methods for Decreasing Standby Energy: Lower Standby power components. Methods for Increasing Overall Efficiency: Capacity increase (without requiring a cabinet width increase). * Most of the methods for decreasing water use are also methods for decreasing water heating energy, since less hot water is used. 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; do not result in adverse impacts on product utility or product availability; do not result in adverse impacts on health or safety; and do not represent 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 RCWs. 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 set of cost-efficiency ‘‘curves’’ that are used in downstream analyses (i.e., the LCC and PBP analyses and the NIA). In this section, DOE discusses comments received in response to the prediction tool developed in support of the September 2021 Preliminary Analysis. In the sections that follow, DOE details the efficiency levels analyzed for each product class; the approach used to develop cost estimates for each efficiency level and the resulting cost-efficiency relationship; the equations used to translate IMEF and IWF into EER and WER; and the E:\FR\FM\03MRP2.SGM 03MRP2 13544 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules ddrumheller on DSK120RN23PROD with PROPOSALS2 approach used to develop the manufacturer markup. In response to the September 2021 Preliminary Analysis, ASAP et al. commented generally in support of DOE’s approach to select efficiency levels based on the proposed new efficiency metrics, EER and WER. (ASAP et al., No. 37 at p. 1) 1. Preliminary Analysis Prediction Tool In support of the September 2021 Preliminary Analysis, DOE tested a sample of RCWs under both appendix J2 and appendix J as proposed in the September 2021 TP NOPR. As described in chapter 5 of the September 2021 Preliminary TSD, DOE supplemented its tested dataset with ‘‘predicted’’ EER and WER values for a larger sample of units. The EER and WER predictions which were estimated based on each model’s measured performance under appendix J2 and on the model’s physical and operational characteristics. DOE also published an explanation of how the predictive tool was developed, including a table listing the impacts to each underlying variable that were assumed as part of the predictive analysis. DOE explained that it planned to continue testing additional units to appendix J to increase the number of tested, rather than predicted, EER and WER values in future stages of the rulemaking. AHAM commented that DOE did not provide sufficient explanation for the ‘‘prediction tool’’ that DOE used to predict a clothes washer’s EER and WER values based on appendix J2 test results. (AHAM, No. 40 at pp. 4–6) AHAM further explained that its data, which include models representing approximately half of total 2020 shipments, contradicted the data presented in the September 2021 Preliminary TSD. (Id.) AHAM expressed concern that DOE did not provide any statistical outcomes to justify the accuracy of the prediction tool it used to predict a clothes washers EER and WER values based on appendix J2 test results. (AHAM, No. 40 at pp. 15–17) AHAM commented that without data on statistical outcomes, AHAM cannot assess the accuracy of the prediction tool. (Id.) AHAM also commented that based on the analysis that transposes efficiency levels, DOE’s prediction tool appears to be inaccurate and that under the best-fit line method for front-loading clothes washers, the R-squared values show the prediction tool is insufficient. (Id.) AHAM therefore recommended that DOE update its analysis based on tested data instead of predicted data, especially for top-loading standard clothes washers with capacities less VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 than 3.0 ft3, and for front-loading compact clothes washers. (Id.) AHAM also requested that DOE provide appendix J2 and appendix J test data; the statistical data demonstrating correlation of the prediction tool; the data supporting the development of the tool, including the equations the prediction tool used; and DOE’s comparison between predicted and tested EER where applicable. (Id.) AHAM noted that, unlike DOE, its data was all based on actual testing instead of using a model or prediction tool. (Id.) AHAM presented a table showing the variation in tested HET, MET, DET, ETLP, QT, and corrected RMC between appendix J2 and appendix J for the AHAM data, DOE data, and the combined AHAM and DOE dataset. (AHAM, No. 53 at pp. 7–8) AHAM measured variation by measuring the percent difference in each metric between appendix J2 and appendix J for all units, and presented an overall variation in each metric by calculating the average percent differences for each metric, the standard deviation of the percent differences for each metric, and the range of percent differences for each metric. (Id.) AHAM noted that on average, values for HET, MET, DET, ETLP, QT, and corrected RMC were higher under appendix J than under appendix J2. (Id.) AHAM also noted that the level of variation was particularly high for DET and ETLP. (Id.) AHAM commented that, while the overall impact of standby energy in the final calculation for energy efficiency is quite small, the impact of dryer energy on the final calculated efficiency is significant. (Id.) Based on its analysis, AHAM concluded that this variation shows that a direct translation between the appendix J2 and appendix J test procedures is not possible. (Id.) AHAM specifically pointed out that the total dryer energy consumption showed an average increase of 22.5 percent, but that the range of differences with the tested models is quite wide, indicating that it is impossible to predict the impact of appendix J on dryer energy consumption. (Id.) AHAM added that the appendix J2 to appendix J translation has a similar effect on corrected RMC, and is most apparent with respect to ETLP, where measured values varied by as much as 221 percent. (Id.) AHAM further explained that the relatively high standard deviations of percent differences underscore the wide ranges in the measured value differences between appendix J2 and appendix J. (Id.) Samsung commented that the prediction tool used in the September 2021 Preliminary TSD does not have a PO 00000 Frm 00026 Fmt 4701 Sfmt 4702 high correlation between EER and IMEF. (Samsung, No. 41 at p. 3) ASAP et al. commented that they support DOE’s approach to use its predictive tool and that they support conducting additional testing using the new proposed appendix J test procedure to refine this approach. (ASAP et al., No. 37 at p. 1) Ameren et al. expressed support for DOE’s approach to predict EER and WER values from tested IMEF and IWF value and commented that they support future testing with appendix J to collect more results with the proposed new appendix J test procedure. (Ameren et al., No. 42 at pp. 19–20). Ameren et al. added that DOE’s RMC and Warm Wash temperature results are consistent with findings in the 2020 NEEA report. (Id.) Ameren et al. added that the non-linear nature of the relationship between IMEF and IWF values and EER and WER values is similar to the non-linearity that NEEA identified in a translation of appendix J2 tests to real-world energy use. (Id.) As noted, DOE stated in the September 2021 Preliminary TSD that it planned to continue testing additional units to appendix J to increase the number of tested, rather than predicted, EER and WER values for future stages of this proposed rulemaking. As described in the April 2022 NODA, DOE has tested additional 28 additional RCW models to both appendix J2 and appendix J in order to provide additional data points for the translation equations and to eliminate the need to rely on ‘‘predicted’’ EER and WER values in the translation analysis. 87 FR 21816, 21817. DOE’s total test sample includes 44 units across all five product classes analyzed for this NOPR. DOE made available detailed appendix J and appendix J2 test data for its full set of tested units as part of the April 2022 NODA. As discussed in section IV.C.5 of this document, for this NOPR DOE relied exclusively on tested data for developing translation equations for each automatic clothes washer product class and did not continue the usage of its prediction tool as part of its analysis. The discontinuation of the prediction tool addresses many of the concerns expressed by AHAM and Samsung. As detailed in section IV.C.5 of this document, the comprehensive dataset has enabled DOE to develop robust translations between the appendix J2 and appendix J metrics. 2. 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 E:\FR\FM\03MRP2.SGM 03MRP2 13545 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules 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). For this NOPR, DOE used an efficiency-level approach, supplemented with the design-option approach for certain ‘‘gap fill’’ efficiency levels. The efficiency-level approach is appropriate for RCWs, given the availability of certification data to determine the market distribution of existing products and to identify efficiency level ‘‘clusters’’ that already exist on the market. In conducting the efficiency analysis for the automatic clothes washer product classes, DOE first identified efficiency levels in terms of the current IMEF and IWF metrics defined in appendix J2 that are the most familiar to interested parties. DOE also initially determined the cost-efficiency relationships based on these metrics. Following that, DOE translated each efficiency level into its corresponding EER and WER values using the translation equations developed for each product class, as discussed further in section IV.C.5 of this document. For the semi-automatic product class, for which reliable certification data is unavailable, DOE tested a representative sample of units to appendix J and used that set of data points to determine the baseline and higher efficiency levels, as described further in section IV.C.2.c of this document. The efficiency levels that DOE considered in the engineering analysis are attainable using technologies currently available on the market in RCWs. DOE used the results of the testing and teardown analyses to determine a representative set of technologies and design strategies that manufacturers use to achieve each higher efficiency level. This information provides interested parties with additional transparency of assumptions and results, and the ability to perform independent analyses for verification. Chapter 5 of the NOPR TSD describes the methodology and results of the analysis used to derive the costefficiency relationships. 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 (e.g., capacity, physical size). 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. In the September 2021 Preliminary Analysis, DOE presented an initial set of baseline levels for each product class, as shown in Table IV.3. TABLE IV.3—PRELIMINARY BASELINE EFFICIENCY LEVELS PRESENTED IN THE SEPTEMBER 2021 PRELIMINARY ANALYSIS Minimum IMEF (ft3/kWh/cycle) Product class Source Top-Loading, Compact (<1.6 ft3) * .......................... Top-Loading, Standard-Size (≥1.6 ft3) .................... Front-Loading, Compact (<3.0 ft3) .......................... Current DOE standard ........................................... Current DOE standard ........................................... Current DOE standard for front-loading, standardsize (≥1.6 ft3) **. ENERGY STAR v. 7.0 *** ...................................... Front-Loading, Standard-Size (≥3.0 ft3) ................. Maximum IWF (gal/cycle/ft3) 1.15 1.57 1.84 12.0 6.5 4.7 2.38 3.7 ddrumheller on DSK120RN23PROD with PROPOSALS2 * As discussed in section IV.A.1 of this document, DOE is proposing in this NOPR to rename the top-loading compact product class analyzed in the September 2021 Preliminary Analysis to top-loading ‘‘ultra-compact.’’ ** Although the current DOE standard for front-loading, compact (<1.6 ft3) is 1.13 IMEF/8.3 IWF, no front-loading units are currently on the market with a capacity <1.6 ft3. The proposed baseline efficiency level reflects the currently applicable standard for front-loading RCWs with capacities between 1.6 and 3.0 ft3. *** Although the current DOE standard for front-loading standard-size (≥1.6 ft3) is 1.84 IMEF/4.7 IWF, at the time of analysis, the least efficient front-loading standard-size RCW available on the market had an efficiency rating of 2.38 IMEF/3.7 IWF. Additionally, in the September 2021 Preliminary Analysis, DOE sought comment on whether the baseline efficiency levels identified in its analysis for each product class were appropriate. The CA IOUs presented data from their analysis of front-loading standardsize products available on DOE’s CCD. (CA IOUs, No. 43 at pp. 5–6) The CA IOUs commented that, according to their analysis of the CCD, eight models ranging from 4.3 ft3 to 5 ft3 are rated at the current federal minimum standard VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 of 1.84 IMEF and 4.7 IWF, and recommended that DOE update the baseline definition to the current minimum efficiency levels to prevent an undercount of the overall savings potential. (Id.) The CA IOUs also identified some models rated at 2.92 IMEF and 4.5 IWF in the CCD, which reflects a worse IWF (although a better IMEF) than the baseline level analyzed in the September 2021 Preliminary Analysis. (Id.) NYSERDA commented that DOE’s CCD shows front-loading standard-size PO 00000 Frm 00027 Fmt 4701 Sfmt 4702 clothes washers from 4.3 to 5.0 ft3 rated at the current minimum standard level of 1.84 IMEF. (NYSERDA, No. 36 at p. 2) NYSERDA recommended that DOE therefore consider the existing standard as the baseline for these products instead of the ENERGY STAR 2015 level of 2.38 IMEF. (Id.) In response to the CA IOUs and NYSERDA’s comment that the CCD includes standard-size front-loading clothes washers that are rated at the current standard level of 1.84 IMEF, DOE has determined through testing E:\FR\FM\03MRP2.SGM 03MRP2 13546 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules that these units perform significantly above their rated value at the current standard level. DOE has also confirmed these findings through confidential manufacturer interviews. In response to the CA IOUs’ comment that the CCD also includes a model with a worse IWF rating of 4.5 IWF, DOE notes that this unit’s rating appears to be a typographical error. DOE notes that this unit is listed in the ENERGY STAR database with an IWF rating of 2.9 and a capacity of 4.5 ft3, suggesting that the capacity measurement was inadvertently reported as the IWF value in DOE’s CCD. For these reasons, DOE tentatively concludes that for the standard-size front-loading product class, the lowest available efficiency on the market is 2.38 IMEF and 3.7 IWF, and this level is an appropriate representation of baseline efficiency. Accordingly, in this NOPR, DOE analyzed the baseline efficiency levels shown in Table IV.4 for each automatic product class.44 TABLE IV.4—BASELINE EFFICIENCY LEVELS ANALYZED IN THIS NOPR Minimum IMEF (ft3/kWh/cycle) Product class Source Top-Loading, Ultra-Compact (<1.6 ft3) ................... Top-Loading, Standard-Size (≥1.6 ft3) .................... Front-Loading, Compact (<3.0 ft3) .......................... Current DOE standard ........................................... Current DOE standard ........................................... Current DOE standard for front-loading, standardsize (≥1.6 ft3) *. ENERGY STAR v. 7.0 ** ........................................ Front-Loading, Standard-Size (≥3.0 ft3) ................. Maximum IWF (gal/cycle/ft3) 1.15 1.57 1.84 12.0 6.5 4.7 2.38 3.7 * Although the current DOE standard for front-loading compact (<1.6 ft3) is 1.13 IMEF/8.3 IWF, no front-loading units are currently on the market with a capacity <1.6 ft3. The proposed baseline efficiency level reflects the currently applicable standard for front-loading RCWs with capacities between 1.6 and 3.0 ft3. ** Although the current DOE standard for front-loading standard-size (≥1.6 ft3) is 1.84 IMEF/4.7 IWF, at the time of analysis, the least efficient front-loading standard-size RCW available on the has an efficiency rating of 2.38 IMEF/3.7 IWF. ddrumheller on DSK120RN23PROD with PROPOSALS2 DOE seeks comment on whether the baseline efficiency levels analyzed in this NOPR for each product class are appropriate. b. Higher Efficiency Levels To establish higher efficiency levels for the analysis, DOE reviewed data in DOE’s CCD to evaluate the range of efficiencies for RCWs currently available on the market.45 As part of DOE’s analysis, the ‘‘maximum available’’ efficiency level is 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 in each product class. (42 U.S.C. 6295(p)(1)) DOE typically determines max-tech levels based on technologies that are either commercially available or have been demonstrated as working prototypes. If the max-tech design meets DOE’s screening criteria, DOE considers the design in further analysis. DOE has tentatively determined that the max-tech efficiency level for each RCW product class corresponds to the maximum available level for each product class. In other words, DOE has not defined or analyzed any efficiency levels higher than those currently available on the market. As noted, EPCA requires that any new or amended energy conservation 44 See section IV.C.2.c of this document for a discussion of efficiency levels for the semiautomatic product class. 45 DOE’s Compliance Certification Database is available at www.regulations.doe.gov/certificationdata. Analysis conducted May 2022. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 standard be designed to achieve the maximum improvement in energy efficiency that is technologically feasible. (42 U.S.C. 6295(o)(2)(A)) For RCWs, a determination of technological feasibility must encompass not only an achievable reduction in energy and/or water consumption, but also the ability of the product to perform its intended function (i.e., wash clothing) at reduced energy or water levels.46 Attributes that are relevant to consumers encompass multiple aspects of RCW operation such as stain removal, solid particle removal, rinsing effectiveness, fabric gentleness, cycle time, noise, vibration, and others. Each of these attributes may be affected by energy and water efficiency levels, and achieving better performance in one attribute may require a tradeoff with one or more other attributes. DOE does not have the means to be able to determine whether a product that uses less water or energy than the maximum efficiency level available on the market would represent a viable (i.e., technologically feasible) product that would satisfy consumer expectations regarding all the other aspects of RCW performance that are not measured by the DOE test procedure. As far as DOE is aware, the complexity of the interdependence among all these attributes precludes being able to use a computer model or other similar means to predict changes in these product attributes as a result of reduced energy and water levels. Rather, as far as DOE is aware, such determinations are made in an iterative fashion through extensive product testing as part of manufacturers’ design processes. In the September 2021 Preliminary Analysis, for all product classes except top-loading compact, DOE considered efficiency levels higher than baseline levels based on specifications prescribed by ENERGY STAR® and the Consortium for Energy Efficiency (‘‘CEE’’)’s Super Efficient HomeAppliances Initiative,47 as well as gapfill levels. At the time of the September 2021 Preliminary Analysis, large clusters of models were available at the ENERGY STAR and CEE Tier levels, as evident in the market distribution plots presented in chapter 3 of the September 2021 Preliminary TSD. At the time of the September 2021 Preliminary Analysis, no automatic top-loading compact RCWs were available on the market that exceeded the baseline level. Accordingly, DOE did not consider any higher efficiency levels for this product class. In chapter 5 of the September 2021 Preliminary TSD, DOE established the preliminary efficiency levels for each product class as presented in Table IV.5 through Table IV.8. 46 As an extreme example, DOE could consider a hypothetical RCW that reduces its water consumption to near-zero, but such a product would not be viable for washing clothing, given current technology. 47 CEE Super-Efficient Home Appliance Initiative available at cee1.org/content/cee-programresources. Accessed July 13, 2022. PO 00000 Frm 00028 Fmt 4701 Sfmt 4702 E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules 13547 TABLE IV.5—TOP-LOADING, COMPACT * (<1.6 ft3) PRELIMINARY EFFICIENCY LEVELS, AS PRESENTED IN THE SEPTEMBER 2021 PRELIMINARY ANALYSIS IMEF (ft3/kWh/cycle) EL Efficiency level description Baseline ......... Current DOE standard .................................................................................................... IWF (gal/cycle/ft3) 1.15 12.0 * As discussed in section IV.A.1 of this document, DOE is proposing in this NOPR to rename the top-loading compact product class analyzed in the September 2021 Preliminary Analysis to top-loading ‘‘ultra-compact.’’ TABLE IV.6—TOP-LOADING, STANDARD-SIZE (≥1.6 ft3) PRELIMINARY EFFICIENCY LEVELS, AS PRESENTED IN THE SEPTEMBER 2021 PRELIMINARY ANALYSIS IMEF (ft3/kWh/cycle) EL Efficiency level description Baseline ......... 1 ..................... 2 ..................... 3 ..................... 4 ..................... Current DOE standard .................................................................................................... Gap fill ............................................................................................................................. ENERGY STAR (v. 8.1) .................................................................................................. 2015–2017 CEE Tier 1 ................................................................................................... 2015 ENERGY STAR Most Efficient/Maximum available .............................................. IWF (gal/cycle/ft3) 1.57 1.70 2.06 2.38 2.76 6.5 5.0 4.3 3.7 3.5 TABLE IV.7—FRONT-LOADING, COMPACT (<3.0 ft3) PRELIMINARY EFFICIENCY LEVELS, AS PRESENTED IN THE SEPTEMBER 2021 PRELIMINARY ANALYSIS IMEF (ft3/kWh/cycle) EL Efficiency level description Baseline ......... 1 ..................... 2 ..................... 3 ..................... 4 ..................... Current DOE standard for front-loading, standard-size (≥1.6 ft3) ................................... ENERGY STAR v. 8.1 level for units ≤2.5 ft3 ................................................................. 2018–2022 ENERGY STAR Most Efficient for units ≤2.5 ft3 ......................................... ENERGY STAR v. 7.0 level for units >2.5 ft3 ................................................................. ENERGY STAR v. 8.1 level for units >2.5 ft3/Maximum available ................................. IWF (gal/cycle/ft3) 1.84 2.07 2.20 2.38 2.76 4.7 4.2 3.7 3.7 3.2 ddrumheller on DSK120RN23PROD with PROPOSALS2 TABLE IV.8—FRONT-LOADING, STANDARD-SIZE (≥3.0 ft3) PRELIMINARY EFFICIENCY LEVELS, AS PRESENTED IN THE SEPTEMBER 2021 PRELIMINARY ANALYSIS IMEF (ft3/kWh/cycle) EL Efficiency level description Baseline ......... 1 ..................... 2 ..................... 3 ..................... 4 ..................... ENERGY STAR v. 7.0 .................................................................................................... Gap fill ............................................................................................................................. ENERGY STAR v. 8.1 .................................................................................................... 2018–2022 ENERGY STAR Most Efficient .................................................................... Maximum available .......................................................................................................... DOE sought comment on whether the preliminary higher efficiency levels identified in the September 2021 Preliminary Analysis for each product class were appropriate. The CA IOUs, ASAP et al., and NYSERDA recommended that DOE consider revisiting max-tech and higher efficiency levels based on currently available products, for the top-loading compact product class. (CA IOUs, No. 43 at pp. 4–5; ASAP et al., No. 37 at p. 4; NYSERDA, No. 36 at p. 2) These stakeholders expressed concern that DOE did not consider any products above the baseline levels of 1.15 IMEF and 12.0 IWF, since the ratings in DOE’s CCD indicates top-loading compact models that exceed these levels. (Id.) ASAP et al. noted that DOE’s CCD includes 8 top-loading compact models with IMEF ratings between 1.24 and VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 1.36. (ASAP et al., No. 37 at p. 4) Furthermore, ASAP et al. commented that the new proposed test procedure could change the relative rankings and range of efficiency ratings for toploading compact models. (Id.) DOE’s CCD currently includes both automatic clothes washer models and semi-automatic clothes washer models certified within the top-loading compact product class. While the certification database does not differentiate between automatic and semi-automatic configurations, DOE conducted an analysis of product literature for each certified model to identify the configuration of each model in the CCD. DOE’s analysis indicates that considering only automatic top-loading compact clothes washers, models are available only at the baseline efficiency level. All of the other top-loading PO 00000 Frm 00029 Fmt 4701 Sfmt 4702 2.38 2.60 2.76 2.92 3.00 IWF (gal/cycle/ft3) 3.7 3.5 3.2 3.2 2.9 compact-size models in the CCD at higher efficiency levels are semiautomatic top-loading clothes washers with capacities less than 1.6 ft3. When evaluating only automatic top-loading compact clothes washers in the CCD, only products with baseline efficiency have been certified to DOE. Therefore, because DOE is not aware of any automatic top-loading compact RCWs available on the market at the time of this analysis that exceed the baseline level, DOE is not proposing any higher efficiency levels for this product class. Section IV.C.2.c of this document discusses the efficiency levels that DOE proposes for semi-automatic clothes washers. The CA IOUs and NYSERDA also recommended that DOE consider revisiting max-tech and higher efficiency levels based on currently E:\FR\FM\03MRP2.SGM 03MRP2 13548 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules available products, for the top-loading standard-size product class. (CA IOUs, No. 43 at p. 5; NYSERDA, No. 36 at p. 2) These stakeholders commented that according to their analysis of the CCD, nine models are certified to lower (more efficient) IWFs than the most efficient considered efficiency level presented in the September 2021 Preliminary TSD. (Id.) The CA IOUs therefore recommended that DOE adjust the maximum achievable efficiency level to reflect the market availability of toploading standard-size products. (CA IOUs, No. 43 at p. 5) NYSERDA recommended that DOE add an EL 5 using the maximum technologically available efficiency ratings rather than the 2015 ENERGY STAR Most Efficient level to better reflect the constantly improving market. (NYSERDA, No. 36 at p. 2) The CA IOUs and NYSERDA also recommended that DOE consider revisiting max-tech and higher efficiency levels based on currently available products, for the front-loading standard-size product class. (CA IOUs, No. 43 at pp. 5–6; NYSERDA, No. 36 at p. 2) These stakeholders commented that the CCD contains units with higher efficiencies than the max-tech level DOE considered in the September 2021 Preliminary Analysis and recommended that DOE adjust the highest efficiency levels to reflect the availability of these products. (Id.) The CA IOUs identified 11 models that surpass the IMEF and IWF maximum available level presented in the September 2021 Preliminary TSD, at 3.1 IMEF and 2.7 and 2.9 IWF. (CA IOUs, No. 43 at pp. 5–6) In response to changes in availability on the market since the September 2021 Preliminary Analysis, as reflected by the models in DOE’s CCD identified by commenters, DOE has updated the maxtech levels for the top-loading standardsize and front-loading standard-size product classes to reflect the maximum efficiency available in the CCD at the time of this NOPR analysis. The updated max-tech level for top-loading standard-size is 2.76 IMEF/3.2 IWF, which DOE notes corresponds to the 2016/2017 ENERGY STAR Most Efficient criteria. The updated max-tech level for front-loading standard-size is 3.10 IMEF/2.9 IWF. Although DOE also identified two RCW models in DOE’s CCD that are rated at 3.10 IMEF/2.7 IWF, these units have extra-large capacity drums that necessitate cabinet widths greater than 27 inches. As discussed in section IV.B.1 of this NOPR, DOE excluded from consideration any drum capacities increase that require a cabinet width increase beyond 27 inches. DOE also updated the definition of the top-loading standard-size gap-fill level (i.e., EL 1) to reflect changes in the market since September 2021 Preliminary Analysis. In the September 2021 Preliminary Analysis, DOE defined EL 1 as 1.70 IMEF/5.0 IWF based on a small cluster of units in DOE’s CCD rated at or near that level. Subsequent to the September 2021 Preliminary Analysis, these units have been discontinued from the market and are no longer listed in DOE’s CCD; in addition, DOE’s market research indicates that the brand associated with these units no longer offers top-loading clothes washers for sale in the U.S. market. In lieu of any product offerings currently on the market between the baseline level (corresponding to the DOE minimum standard) and EL 2 (corresponding to the applicable ENERGY STAR criteria), in this NOPR DOE has defined EL 1 as the numerical midpoint between the baseline and EL 2 levels. Lastly, DOE updated the definition of EL 3 for the front-loading compact product class to better align with an existing market cluster. In the September 2021 Preliminary Analysis, DOE had defined EL 3 as 2.38 IMEF/3.7 IWF, which represented the ENERGY STAR v. 7.0 level for units with capacity greater than 2.5 ft3. This resulted in a relatively large gap in IMEF between EL 3 and EL 4 (2.38 to 2.76 IMEF). For this NOPR, DOE has instead defined EL 3 as 2.50 IMEF/3.5 IWF as a gap fill level representing a market cluster at that point. This also results in EL 3 being closer to the midpoint of EL 2 and EL 4. In summary, for this NOPR, DOE analyzed the efficiency levels for each product class shown in Table IV.9 through Table IV.12. TABLE IV.9—TOP-LOADING, ULTRA-COMPACT (<1.6 ft3) EFFICIENCY LEVELS ANALYZED IN THIS NOPR IMEF (ft3/kWh/cycle) EL Efficiency level description Baseline ......... Current DOE standard .................................................................................................... IWF (gal/cycle/ft3) 1.15 12.0 TABLE IV.10—TOP-LOADING, STANDARD-SIZE (≥1.6 ft3) EFFICIENCY LEVELS ANALYZED IN THIS NOPR IMEF (ft3/kWh/cycle) EL Efficiency level description Baseline ......... 1 ..................... 2 ..................... 3 ..................... 4 ..................... Current DOE standard .................................................................................................... Gap fill ............................................................................................................................. ENERGY STAR v. 8.1 .................................................................................................... 2015–2017 CEE Tier 1 ................................................................................................... Maximum available (2016/2017 ENERGY STAR Most Efficient) ................................... IWF (gal/cycle/ft3) 1.57 1.82 2.06 2.38 2.76 6.5 5.4 4.3 3.7 3.2 ddrumheller on DSK120RN23PROD with PROPOSALS2 TABLE IV.11—FRONT-LOADING, COMPACT (<3.0 ft3) EFFICIENCY LEVELS ANALYZED IN THIS NOPR IMEF (ft3/kWh/cycle) EL Efficiency level description Baseline ......... 1 ..................... 2 ..................... 3 ..................... 4 ..................... Current DOE standard for front-loading, standard-size (≥1.6 ft3) ................................... ENERGY STAR v. 8.1 level for units ≤2.5 ft3 ................................................................. 2023 ENERGY STAR Most Efficient for units ≤2.5 ft3 ................................................... Gap fill ............................................................................................................................. Maximum available (ENERGY STAR v. 8.1 level for units >2.5 ft3) .............................. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 PO 00000 Frm 00030 Fmt 4701 Sfmt 4702 E:\FR\FM\03MRP2.SGM 1.84 2.07 2.20 2.50 2.76 03MRP2 IWF (gal/cycle/ft3) 4.7 4.2 3.7 3.5 3.2 13549 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules TABLE IV.12—FRONT-LOADING, STANDARD-SIZE (≥3.0 ft3) EFFICIENCY LEVELS ANALYZED IN THIS NOPR IMEF (ft3/kWh/cycle) EL Efficiency level description Baseline ......... 1 ..................... 2 ..................... 3 ..................... 4 ..................... ENERGY STAR v. 7.0 .................................................................................................... Gap fill ............................................................................................................................. ENERGY STAR v. 8.1 .................................................................................................... 2023 ENERGY STAR Most Efficient .............................................................................. Maximum available .......................................................................................................... DOE seeks comment on whether the higher efficiency levels analyzed in this NOPR for each product class are appropriate. c. Semi-Automatic As discussed, DOE’s CCD includes both automatic clothes washer models and semi-automatic clothes washer models certified within the top-loading compact product class. While the certification database does not differentiate between automatic and semi-automatic configurations, DOE conducted an analysis of product literature for each certified model to identify whether each model is automatic or semi-automatic. In the September 2021 Preliminary TSD and the April 2022 NODA, DOE did not present any data or analysis for semi-automatic clothes washers. As discussed in section IV.A.1 of this document, in this NOPR, DOE is proposing to re-establish a separate product class for semi-automatic clothes washers and to establish performancebased standards for semi-automatic clothes washers. As discussed previously, CCD currently includes both automatic clothes washer models and semiautomatic clothes washer models certified within the top-loading compact product class. While the certification database does not differentiate between automatic and semi-automatic configurations, DOE conducted an analysis of product literature for each certified model to identify the semiautomatic models in the CCD. To define the efficiency levels for analysis for the semi-automatic product class, DOE did not rely on any ratings currently provided in the CCD. As discussed in the September 2021 TP NOPR, DOE identified areas in which the current test procedure does not provide explicit instruction with regard to semi-automatic clothe washers. 86 FR 49140, 49147. As a result, DOE stated that it recognizes that the proposed specifications for testing semi-automatic clothes washers in appendix J may differ from how manufacturers are currently testing semi-automatic clothes washers under appendix J2. Id. at 86 FR 49168. As finalized, appendix J includes significant changes to the testing of semi-automatic clothes washers, which 2.38 2.60 2.76 2.92 3.10 IWF (gal/cycle/ft3) 3.7 3.5 3.2 3.2 2.9 improve the representativeness of the test results while reducing test burden. Given the lack of specificity in appendix J2 regarding semi-automatic clothes washers, and the significant differences in testing between appendix J2 versus appendix J for semi-automatic clothes washers, DOE tentatively determined that it could not develop an accurate correlation between appendix J2 metrics (i.e., IMEF and IWF) and appendix J metrics (i.e., EER and WER) for semiautomatic clothes washers. Therefore, in this NOPR analysis, DOE defined efficiency levels in terms of EER and WER directly rather than first defining efficiency levels in terms of IMEF and IWF and then developing translation equations to translate those levels to EER and WER. DOE defined the proposed efficiency levels for semiautomatic clothes washers by testing a representative sample of models on the market and observing the range of EER and WER results. Table IV.13 shows the proposed efficiency levels for the semiautomatic product class. See chapter 5 of the NOPR TSD for more details. TABLE IV.13—SEMI-AUTOMATIC EFFICIENCY LEVELS ANALYZED IN THIS NOPR Efficiency level description Baseline ......... 1 ..................... 2 ..................... Minimum available ........................................................................................................... Gap fill ............................................................................................................................. Maximum available .......................................................................................................... DOE seeks comment on whether the efficiency levels analyzed in this NOPR for semi-automatic RCWs are appropriate. 3. Cost Analysis ddrumheller on DSK120RN23PROD with PROPOSALS2 EER (ft3/kWh/cycle) EL 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 VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 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 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 bill of materials for the product. • Price surveys: If neither a physical nor catalog teardown is feasible (for PO 00000 Frm 00031 Fmt 4701 Sfmt 4702 1.60 2.12 2.51 WER (gal/cycle/ft3) 0.17 0.27 0.36 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 the physical teardown approach. For each product class, DOE tore down a representative sample of models spanning the entire E:\FR\FM\03MRP2.SGM 03MRP2 13550 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules range of efficiency levels, as well as multiple manufacturers within each product class. DOE aggregated the results so that the cost-efficiency relationship developed for each product class reflects DOE’s assessment of a market-representative ‘‘path’’ to achieve each higher efficiency level. The resulting bill of materials provides the basis for the manufacturer production cost (‘‘MPC’’) estimates. The detailed description of DOE’s determination of costs for baseline and higher efficiency levels is provided in chapter 5 of the NOPR TSD. Ameren et al. noted that the vast majority of RCW energy savings documented in the September 2021 Preliminary TSD is driven by the toploading standard-size product class, and recommended that DOE take a rigorous approach to evaluate the baseline technologies, likely technology pathways, and associated incremental cost for this product class. (Ameren et al., No. 42 at pp. 3–4) As discussed, DOE followed a rigorous approach to developing the cost-efficiency relationship for each product class. 4. Cost-Efficiency Results In the September 2021 Preliminary Analysis, DOE conducted teardowns on 31 models, which covered the entire range of efficiency levels within each analyzed product class. The preliminary baseline MPCs presented in the September 2021 Preliminary Analysis for each product class are shown in Table IV.14. TABLE IV.14—PRELIMINARY BASELINE MANUFACTURER PRODUCTION COSTS (2020$), AS PRESENTED IN THE SEPTEMBER 2021 PRELIMINARY ANALYSIS Manufacturer production cost Product class Top-Loading, Compact (less than 1.6 ft3 capacity) * ................................................................................................................... Top-Loading, Standard-Size (1.6 ft3 or greater capacity) ........................................................................................................... Front-Loading, Compact (less than 3.0 ft3 capacity) .................................................................................................................. Front-Loading, Standard-Size (3.0 ft3 or greater capacity) ......................................................................................................... $311.00 241.97 292.85 410.15 * As discussed in section IV.A.1 of this document, DOE is proposing in this NOPR to rename the top-loading compact product class analyzed in the September 2021 Preliminary Analysis to top-loading ‘‘ultra-compact.’’ The incremental MPCs presented in the September 2021 Preliminary Analysis for top-loading standard-size; front-loading compact; and frontloading standard-size product classes are shown in Table IV.15 through Table IV.17, respectively. As described previously, DOE did not analyze any higher efficiency levels for the toploading compact product class in the September 2021 Preliminary Analysis since no units on the market exceeded the baseline level. TABLE IV.15—PRELIMINARY INCREMENTAL MANUFACTURER PRODUCTION COSTS FOR TOP-LOADING, STANDARD-SIZE (≥1.6 ft3) PRODUCT CLASS (2020$), AS PRESENTED IN THE SEPTEMBER 2021 PRELIMINARY ANALYSIS EL IMEF Baseline ............................................................................................................................... 1 ........................................................................................................................................... 2 ........................................................................................................................................... 3 ........................................................................................................................................... 4 ........................................................................................................................................... IWF 1.57 1.70 2.06 2.38 2.76 Incremental cost 6.5 5.0 4.3 3.7 3.5 ................................ $39.44 69.34 112.83 115.50 TABLE IV.16—PRELIMINARY INCREMENTAL MANUFACTURER PRODUCTION COSTS FOR FRONT-LOADING, COMPACT (<3.0 ft3) PRODUCT CLASS (2020$), AS PRESENTED IN THE SEPTEMBER 2021 PRELIMINARY ANALYSIS EL IMEF Baseline ............................................................................................................................... 1 ........................................................................................................................................... 2 ........................................................................................................................................... 3 ........................................................................................................................................... 4 ........................................................................................................................................... IWF 1.84 2.07 2.20 2.38 2.76 Incremental cost 4.7 4.2 3.7 3.7 3.2 ................................ $17.97 45.58 83.81 94.53 ddrumheller on DSK120RN23PROD with PROPOSALS2 TABLE IV.17—PRELIMINARY INCREMENTAL MANUFACTURER PRODUCTION COSTS FOR FRONT-LOADING, STANDARD-SIZE (≥3.0 ft3) PRODUCT CLASS (2020$), AS PRESENTED IN THE SEPTEMBER 2021 PRELIMINARY ANALYSIS EL IMEF Baseline ............................................................................................................................... 1 ........................................................................................................................................... 2 ........................................................................................................................................... 3 ........................................................................................................................................... 4 ........................................................................................................................................... VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 PO 00000 Frm 00032 Fmt 4701 Sfmt 4702 IWF 1.57 1.70 2.06 2.38 2.76 E:\FR\FM\03MRP2.SGM Incremental cost 6.5 5.0 4.3 3.7 3.5 03MRP2 ................................ $39.44 69.34 112.83 115.50 ddrumheller on DSK120RN23PROD with PROPOSALS2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules In the September 2021 Preliminary Analysis, DOE sought comment on the cost efficiency relationships developed for each product class. In particular, DOE sought data and information that could be used to further improve the determination of cost at each efficiency level. Ameren et al. commented that NEEA commissioned a laboratory engineering teardown study (‘‘2019 NEEA Teardown’’), comparing appendix J2 testing and teardown results of a toploading standard-size RCW rated at the ENERGY STAR level with a similar toploading standard-size RCW rated at the baseline level. (Ameren et al., No. 42 at pp. 13–14) Ameren et al. stated that the 2019 NEEA Teardown revealed the key difference between the two RCW models was technology that improved water extraction and therefore reduced drying energy. (Id.) Specifically, the ENERGY STAR model had a 0.4 horsepower motor, whereas the baseline model had a 0.33 horsepower motor, and the ENERGY STAR model had a slightly larger diameter pully that enabled a higher spin speed of 800 rpm compared to the 700 rpm of the baseline model. (Id.) Ameren et al. added that even though these differences resulted in slightly higher machine energy use for the ENERGY STAR model, the overall IMEF was better than the baseline model because the ENERGY STAR model had better water extraction capability. (Id.) Based on the data from the 2019 NEEA Teardown, Ameren et al. recommended that DOE consider an increased motor size and alternate pully ratio as a lower-cost compliance pathway to enable higher spin speeds and lower drying energy sufficient to meet EL 2 as proposed in the September 2021 Preliminary TSD. (Id.) Ameren et al. added that this lower-cost technology pathway may be more likely given the higher manufacturing cost of the significant redesign needed to employ a direct drive motor for compliance with EL 2. (Id.) As noted, DOE conducted teardowns on a wide range of top-loading RCWs to inform the cost-efficiency relationships presented in the September 2021 Preliminary Analysis and in this NOPR. DOE’s analysis confirms Ameren et al.’s finding that reduced drying energy through improved water extraction is a key difference between the baseline level and the ENERGY STAR level (i.e., EL 2) in the top-loading standard-size product class. As noted by Ameren et al., DOE’s teardown analysis conducted in support of the September 2021 Preliminary Analysis indicated that to achieve EL 2, manufacturers would likely incorporate a wash plate VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 (sometimes also called an ‘‘impeller’’); direct-drive motor; spray rinse; and other hardware features to enable a spin speed increase. As described previously, the cost-efficiency relationship developed for each product class reflects DOE’s assessment of a marketrepresentative ‘‘path’’ to achieve each higher efficiency level; i.e., it does not necessarily reflect the lowest-cost pathway employed by a particular manufacturer. Through the breadth of models torn down at the baseline level and EL 2, DOE determined that the most typical approach currently being used by manufacturers to achieve EL 2 is through the use of a direct-drive motor. DOE also notes that regardless of whether higher spin speeds are achieved through the use of a conventional motor or direct-drive motor, other hardware-related changes must also be employed to safely enable higher spin speeds. The cost-efficiency relationship reflects the totality of these costs. The CA IOUs commented that the September 2021 Preliminary TSD does not appear to incorporate lower standby components at any efficiency levels for top-loading clothes washers, despite lower standby power being listed in remaining design options of the screening analysis. (CA IOUs, No. 43 at p. 5) The CA IOUs therefore recommended that DOE consider adding lower standby power components as a design option for top-loading products when incorporating changes to its analysis. (Id.) Through its testing and teardowns conducted in support of the September 2021 Preliminary Analysis as well as this NOPR, DOE has not observed any consistent trend of lower-standby power components being used to achieve higher efficiency levels within the toploading standard-size product class. As discussed, the cost-efficiency relationship developed for each product class reflects DOE’s assessment of a market-representative ‘‘path’’ to achieve each higher efficiency level. DOE notes that given the relatively small contribution of standby power to the total energy measured by the test procedure, reducing standby power has a relatively minor impact on EER compared to other design options. AHAM commented that based on its test data, it would be challenging for low priced top-loading clothes washers to meet the efficiency levels DOE analyzed in the September 2021 Preliminary Analysis. (AHAM, No. 40 at p. 16) Whirlpool commented that many of the design options DOE suggested in the September 2021 Preliminary Analysis to reach EL 2 would present PO 00000 Frm 00033 Fmt 4701 Sfmt 4702 13551 significant challenges to manufacturers and cautioned DOE against considering some of these design options as viable technology options. (Whirlpool, No. 39 at p. 3) With regard to top-loading standardsize EL 2 specifically, in the September 2021 Preliminary Analysis, DOE indicated that the following design options are used: wash plate, directdrive motor, spray rinse, and hardware features enabling spin speed increase. As discussed, DOE’s identification of design options reflects DOE’s observations through teardowns of those design options that manufacturers are currently employing to achieve each higher efficiency level. DOE’s analyses consider the costs required to implement these design options as well as other implications that may be associated with each higher efficiency level. Ameren et al. commented that NEEA’s market research identified key characteristics of baseline top-loading standard-size RCWs, including capacity, water fill control, number of programs, number of wash temperatures, price, and wash basket material type, based on a sample of 9 RCWs, representing 6 brands, and comprising 32 percent of total top-loading standard-size RCW sales. (Ameren et al., No. 42 at p. 3–6) Ameren et al. concluded that NEEA’s data matched well with DOE’s characterization of the baseline product market with one key exception: NEEA observed a dominance of stainless-steel wash baskets in the baseline market, while DOE characterizes the baseline product as having an enameled steel wash basket. (Id.) NEEA found that, among RCWs with a retail price less than $600, 64 percent of top-loading baseline efficiency RCWs had stainlesssteel wash baskets, and that among RCWs with a retail price less than $500, 51 percent of RCWs had stainless-steel wash baskets. (Id.) Given NEEA’s findings, Ameren et al. recommended that DOE adjust the engineering analysis to include stainless-steel wash baskets in its characterization of the baseline model by either adopting a representative baseline model with a stainless-steel wash basket to represent the baseline top-loading standard-size RCWs, or developing a sales-weighted average cost of the top-loading RCW baseline model and a sales-weighted average incremental cost for EL 1 and EL 2. (Id.) Whirlpool also commented on the use of stainless-steel wash baskets as a design option. Whirlpool commented that its testing confirmed DOE’s statement that drying energy is the largest component of overall efficiency E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 13552 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules and stated that a faster and longer spin speed is the number one technology option for many clothes washer models to enable increased efficiency as measured using IMEF or EER. (Whirlpool, No. 39 at pp. 4–6) Whirlpool added that for some clothes washers, increasing spin speed or spin time would be the only viable path to meet EL 2. (Id.) Whirlpool commented that using stainless-steel wash baskets instead of porcelain ones is a necessary technology upgrade to increase spin speed and spin time because porcelain tends to chip or crack at higher speeds, which exposes the underlying steel, which then rusts. (Id.) Whirlpool commented that an increase to amended standards could drive porcelain wash baskets out of the market and force a massive costly shift to stainless-steel wash baskets. (Id.) Whirlpool noted that clothes washers with porcelain wash baskets comprise a majority of its opening-price-point top-loading standard-size clothes washers, which are popular with consumers for their traditional look and affordability. (Id.) Whirlpool expressed concern that the transition to using stainless-steel wash baskets would lead to increased costs for redesign, retooling, lost sales volume, reduced margins, marketing and reflooring, and potential job losses, all of which may be a cost burden to bear by low-income consumers. (Id.) DOE defines a baseline model for each product class as a reference point against which any changes resulting from energy conservation standards can be measured. The baseline model in each product class represents the characteristics of common or typical products in that class. Typically, a baseline model is one that exactly meets the current minimum energy conservation standards. DOE’s cost efficiency curves are intended to represent incremental costs associated with design options that are required in order to achieve higher efficiency levels above the baseline. For top-loading standard-size clothes washers, the faster spin speed at EL 2 requires the use of a stainless-steel wash basket, which has higher strength than the enameled steel material used in baseline models. For top-loading standard-size products at lower efficiency levels (i.e., baseline and EL 1), stainless steel may be used for aesthetic purposes but is not required in order to operate at that efficiency level. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 DOE teardowns indicate that use of an enameled steel material is representative of a ‘‘true’’ baseline toploading compact RCW, and DOE maintains this as the basis for its baseline manufacturing cost estimate in this NOPR. However, DOE notes that its industry conversion cost estimates account for the costs associated with transitioning the portion of the market using porcelain wash baskets to stainless-steel wash baskets. Whirlpool also commented that in addition to using a stainless-steel wash basket, other hardware features would be needed to enable the higher spin speeds required under EL 2 including motor power and powertrain upgrades; more robust product structure such as drive stampings, suspension, and attachments; and components that keep noise and vibration levels consistent with current products. (Id.) Whirlpool concluded that, while DOE captured some of the design options needed to increase spin speed and spin time, DOE’s analysis may not be comprehensive of the number and scale of changes needed when simultaneously changing the test procedure and standards. (Id.) Whirlpool commented that, while implementing a direct drive motor could use up to 50 percent less motor energy, which corresponds with about 5 percent less total energy, the larger savings would come from the increase to spin speed enabled by these new motors and powertrain systems. (Whirlpool, No. 39 at p. 6) Whirlpool also commented that most ENERGY STAR level clothes washers have a direct drive motor or more advanced brushless permanent magnet (‘‘BPM’’) motor, while baseline models typically use a permanent split capacitor (‘‘PSC’’) motor, which is less expensive, but is not capable of reaching higher speeds without tradeoffs. (Id.) AHAM commented that increasing spin speed and spin time will drive motor structure and other product design changes including larger counterweights in front-loading clothes washers. (AHAM, No. 40 at pp. 9–10) AHAM further commented that increasing spin speed and spin time could cause increased vibration and noise, negatively impact fabric care due to tangling and wrinkling, and increase cycle time. (Id.) PO 00000 Frm 00034 Fmt 4701 Sfmt 4702 Whirlpool commented that more efficient spray rinses are a critical piece in the package of technology options needed to meet EL 2 for top-loading standard-size clothes washers. (Whirlpool, No. 39 at p. 6) Whirlpool further explained that while spray rinse is already being used for most models, a further reduction of the amount of water used during spray rinses will be necessary at higher efficiency levels. (Id.) Whirlpool commented that changes to make spray rinse technology even more efficient may impact the design of dispensers and hydraulic components to use less water for the removal of detergent from the load. (Id.) Whirlpool commented that it is uncertain whether DOE has adequately captured these additional design considerations for spray rinse technology and recommended that DOE ensure that they are captured. (Id.) In response to Whirlpool and AHAM’s comments regarding the costs associated with specific design options, DOE notes that it developed its costefficiency relationships based on comprehensive teardowns in which DOE physically dismantles commercially available products, component-by-component, to develop a detailed bill of materials for the product. In this regard, any ancillary components or parts that accompany the major design options indicated in chapter 5 of the NOPR TSD would also be accounted for in DOE’s cost estimates. In particular, with regard to hardware features needed to enable higher spin speeds, DOE’s teardown costs include the cost increases associated with motor structure, bearings, and counterweights. With regard to hardware features needed to enable spray rinse, DOE’s teardown costs include the cost increases associated with water dispensers and tubing. As discussed, DOE conducted additional testing and teardowns following the September 2021 Preliminary Analysis. Table IV.18 shows the updated MPCs for each product class. Table IV.19 through Table IV.22 provide the incremental MPCs for each higher efficiency level for each product class. As discussed, no automatic top-loading compact RCWs are available on the market that exceed the baseline level. Accordingly, DOE did not consider any higher efficiency levels for this product class. E:\FR\FM\03MRP2.SGM 03MRP2 13553 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules TABLE IV.18—BASELINE MANUFACTURER PRODUCTION COSTS [2021$] Manufacturer production cost Product class Semi-Automatic ............................................................................................................................................................................ Top-Loading, Ultra-Compact (less than 1.6 ft3 capacity) ............................................................................................................ Top-Loading, Standard-Size (1.6 ft3 or greater capacity) ........................................................................................................... Front-Loading, Compact (less than 3.0 ft3 capacity) .................................................................................................................. Front-Loading, Standard-Size (3.0 ft3 or greater capacity) ......................................................................................................... $192.96 374.62 272.42 326.18 525.52 TABLE IV.19—INCREMENTAL MANUFACTURER PRODUCTION COSTS FOR SEMI-AUTOMATIC PRODUCT CLASS [2021$] EL EER Baseline ............................................................................................................................... 1 ........................................................................................................................................... 2 ........................................................................................................................................... WER 1.60 2.12 2.51 Incremental cost 0.17 0.27 0.36 ................................ $5.45 9.55 TABLE IV.20—INCREMENTAL MANUFACTURER PRODUCTION COSTS FOR TOP-LOADING, STANDARD-SIZE (≥1.6 ft3) PRODUCT CLASS [2021$] EL IMEF Baseline ............................................................................................................................... 1 ........................................................................................................................................... 2 ........................................................................................................................................... 3 ........................................................................................................................................... 4 ........................................................................................................................................... IWF 1.57 1.82 2.06 2.38 2.76 Incremental cost 6.5 5.4 4.3 3.7 3.5 ................................ $55.49 108.76 114.95 117.90 TABLE IV.21—INCREMENTAL MANUFACTURER PRODUCTION COSTS FOR FRONT-LOADING, COMPACT (<3.0 ft3) PRODUCT CLASS [2021$] EL IMEF Baseline ............................................................................................................................... 1 ........................................................................................................................................... 2 ........................................................................................................................................... 3 ........................................................................................................................................... 4 ........................................................................................................................................... IWF 1.84 2.07 2.20 2.50 2.76 Incremental cost 4.7 4.2 3.7 3.5 3.2 ................................ $32.21 62.07 82.10 84.04 TABLE IV.22—MANUFACTURER PRODUCTION COSTS FOR FRONT-LOADING, STANDARD-SIZE (≥3.0 ft3) PRODUCT CLASS [2021$] EL IMEF ddrumheller on DSK120RN23PROD with PROPOSALS2 Baseline ............................................................................................................................... 1 ........................................................................................................................................... 2 ........................................................................................................................................... 3 ........................................................................................................................................... 4 ........................................................................................................................................... DOE seeks comment on the baseline MPCs and incremental MPCs developed for each product class. 5. Translations As discussed in section III.C of this document, the June 2022 TP Final Rule established a new test procedure, appendix J, which established new efficiency metrics: EER and WER. Appendix J also incorporates a number VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 of revisions that affect the per-cycle energy and water use in comparison to results obtained under the current appendix J2 test procedure. a. Preliminary Analysis Approach In chapter 5 of the September 2021 Preliminary TSD, DOE performed an initial analysis to translate the appendix J2 efficiency levels into appendix J efficiency levels, expressed in EER and PO 00000 Frm 00035 Fmt 4701 Sfmt 4702 IWF 1.57 1.70 2.06 2.38 2.76 Incremental cost 6.5 5.0 4.3 3.7 3.5 ................................ $11.41 19.71 30.52 43.64 WER. Since appendix J was not yet finalized at the time of publication for the September 2021 Preliminary Analysis, DOE’s initial analysis was performed using the version of appendix J proposed in the September 2021 TP NOPR. In the September 2021 Preliminary Analysis, DOE explored two potential methods for translating the IMEF and IWF efficiency levels into equivalent E:\FR\FM\03MRP2.SGM 03MRP2 13554 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules values of EER and WER: using a best-fit line equation for each product class, and using a more qualitative market-cluster method. The IMEF–EER plots generally had lower R-squared values 48 than the IWF–WER plots, indicating a weaker correlation between EER and IMEF than the relatively stronger correlation between WER and IWF. In particular, the front-loading standard-size product class had an R-squared value of 0.08— indicating a high amount of variance around the line of best fit—such that the linear translation formula would not provide a robust prediction of how individual front-loading standard-size models would be rated under appendix J compared to under appendix J2. Conversely, the top-loading standardsize product class had a higher Rsquared value of 0.77 for the IMEF to EER translation, indicating a much higher degree of confidence in the prediction of how individual toploading standard-size models would be rated under appendix J. Given the lack of strong R-squared value correlation for the front-loading product classes using the best-fit line method, for the September 2021 Preliminary Analysis, DOE used a market-cluster approach to define the EER and WER levels corresponding to the selected IMEF and IWF efficiency levels. The translated EER and WER efficiency levels presented in the September 2021 Preliminary Analysis are shown in Table IV.23 through Table IV.26. TABLE IV.23—TOP-LOADING, COMPACT * (<1.6 ft3) PRELIMINARY EFFICIENCY LEVELS ANALYZED IN THE SEPTEMBER 2021 PRELIMINARY ANALYSIS IMEF (ft3/kWh/cycle) EL Efficiency Level Description Baseline ......... Current DOE standard ......................................... IWF (gal/cycle/ft3) 1.15 EER (lb/kWh/cycle) 12.0 WER (lb/gal/cycle) 4.26 0.33 * As discussed in section IV.A.1 of this document, DOE is proposing in this NOPR to rename the top-loading compact product class analyzed in the September 2021 Preliminary Analysis to top-loading ‘‘ultra-compact.’’ TABLE IV.24—TOP-LOADING, STANDARD-SIZE (≥1.6 ft3) PRELIMINARY EFFICIENCY LEVELS ANALYZED IN THE SEPTEMBER 2021 PRELIMINARY ANALYSIS IMEF (ft3/kWh/cycle) EL Efficiency level description Baseline ............................................ 1 ........................................................ 2 ........................................................ 3 ........................................................ 4 ........................................................ Current DOE standard ..................... Gap fill .............................................. ENERGY STAR v. 8.1 ..................... 2015–2017 CEE Tier 1 .................... 2015 ENERGY STAR Most Efficient/Maximum available. IWF (gal/cycle/ft3) 1.57 1.70 2.06 2.38 2.76 6.5 5.0 4.3 3.7 3.5 EER (lb/kWh/cycle) WER (lb/gal/cycle) 3.73 4.05 4.37 4.96 5.30 0.42 0.54 0.65 0.73 0.73 TABLE IV.25—FRONT-LOADING, COMPACT (<3.0 ft3) PRELIMINARY EFFICIENCY LEVELS ANALYZED IN THE SEPTEMBER 2021 PRELIMINARY ANALYSIS IMEF (ft3/kWh/cycle) EL Efficiency level description Baseline ............................................ Current DOE standard for front-loading, standard-size (≥1.6 ft3). ENERGY STAR v. 8.1 level for ....... units ≤2.5 ft3 ..................................... 2018–2022 ENERGY STAR Most Efficient for units ≤2.5 ft3. ENERGY STAR v. 7.0 level for ....... units >2.5 ft3 ..................................... ENERGY STAR v. 8.1 level for ....... units >2.5 ft3/Maximum available ..... 1 ........................................................ 2 ........................................................ 3 ........................................................ 4 ........................................................ IWF (gal/cycle/ft3) EER (lb/kWh/cycle) WER (lb/gal/cycle) 1.84 4.7 4.20 0.61 2.07 4.2 4.49 0.66 2.20 3.7 4.78 0.71 2.38 3.7 5.10 0.78 2.76 3.2 5.60 0.88 ddrumheller on DSK120RN23PROD with PROPOSALS2 TABLE IV.26—FRONT-LOADING, STANDARD-SIZE (≥3.0 ft3) PRELIMINARY EFFICIENCY LEVELS ANALYZED IN THE SEPTEMBER 2021 PRELIMINARY ANALYSIS IMEF (ft3/kWh/cycle) EL Efficiency level description Baseline ............................................ 1 ........................................................ 2 ........................................................ 3 ........................................................ ENERGY STAR v. 7.0 ..................... Gap fill .............................................. ENERGY STAR v. 8.1 ..................... 2018–2022 ENERGY STAR Most Efficient. Maximum available .......................... 4 ........................................................ 48 The R-squared values of each line of best fit represents the variability of the data around the VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 Frm 00036 Fmt 4701 Sfmt 4702 EER (lb/kWh/cycle) WER (lb/gal/cycle) 2.38 2.60 2.76 2.92 3.7 3.5 3.2 3.2 4.90 5.10 5.30 5.60 0.81 0.85 0.90 0.90 3.00 2.9 6.06 1.10 lines of best fit. The closer the R-squared value is to 1.0, the more the equation of best fit is an PO 00000 IWF (gal/cycle/ft3) accurate representation of the conversion between the two metrics. E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules In the September 2021 Preliminary Analysis, DOE sought comment on the EER and WER levels identified as being equivalent to the IMEF and IWF efficiency levels. DOE further requested data from manufacturers indicating the EER and WER values equivalent to the IMEF and IWF values, respectively, for RCW models currently on the market. Whirlpool commented that DOE underestimated the impacts of the amended test procedure on RCW efficiency and overestimated the number of models that could meet the EER associated with EL 2 in the September 2021 Preliminary TSD, when tested under appendix J. (Whirlpool, No. 39 at p. 3) Whirlpool also commented that many current ENERGY STAR certified RCWs meet the IMEF and IWF levels associated with preliminary EL 2, but would not meet the EER and WER levels defined for EL 2. (Id.) Whirlpool commented that this discrepancy could indicate that the impact of the proposed amended standards could be more severe than DOE analyzed. (Id.) AHAM commented that without a proven translation between appendix J2 and appendix J, DOE has no reliable means to estimate energy savings from its incremental ELs. (AHAM, No. 40 at p. 16) AHAM commented that it attempted to evaluate the accuracy of DOE’s translation by comparing tested appendix J2 and appendix J data among clothes washers that AHAM tested. (Id.) AHAM presented a table comparing Rsquared values for AHAM test data with those presented by DOE in the preliminary analysis. (Id.) AHAM commented that its results are consistent with DOE’s statement that the best-fit line method is insufficient for front-loading clothes washers. (Id.) Additionally, AHAM concluded that DOE’s best-fit line equations show low levels of correlation between appendix J2 and appendix J testing, especially for top-loading standard-size and frontloading compact products. (Id.) AHAM therefore recommended that DOE update its analysis to improve the accuracy of the best-fit line equations and that DOE further investigate the impact of changing from a capacitybased test procedure to a load size-based test procedure on energy and water use. (Id.) AHAM also presented data that plotted DOE’s proposed efficiency levels as well as EER versus WER data for the clothes washers that AHAM tested. (AHAM, No. 40 at pp. 16–17) Based on the data, AHAM found that 65 percent of the top-loading standard-size RCWs it tested, which represent about half of top-loading standard-size clothes VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 washer shipments, are less efficient than the EER/WER baseline proposed in the September 2021 Preliminary TSD. (Id.) AHAM similarly noted that 44.5 percent of DOE’s tested and predicted results are less efficient that the proposed EER/ WER baseline. (Id.) AHAM therefore recommended that DOE shift the baseline for top-loading standard-size clothes washers so that it appropriately represents the least efficient clothes washers on the market. (Id.) AHAM suggested that DOE evaluate a gap-fill level between a baseline level that accounts for the RCWs that fall below DOE’s proposed baseline level and DOE’s proposed EL 1. (AHAM, No. 40 at p. 18) AHAM further commented that the baseline EER/WER level DOE proposed in the September 2021 Preliminary Analysis could serve as a gap-fill level. (Id.) AHAM commented that it is challenging for top-loading standardsize RCWs to reach the EER and WER levels associated with preliminary EL 2. (AHAM, No. 40 at pp. 17–18) Since the IMEF and IWF efficiency levels associated with preliminary EL 2 are the same as the current ENERGY STAR levels, AHAM sought to clarify that DOE should not assume that the current ENERGY STAR penetration values would represent the percentage of models or shipments that can meet EL 2 when tested under appendix J. (Id.) Regarding DOE’s method to evaluate average performance among market clusters, AHAM commented that since DOE did not provide critical calculation and evaluation metrics for its results, AHAM cannot properly assess this approach or test the method’s accuracy using AHAM’s data. (AHAM, No. 40 at p. 16) AHAM commented that the models it tested represent approximately half of total 2020 shipments, and that its test results bring into question the accuracy to DOE’s data. (AHAM, No. 53 at pp. 10–11) AHAM recommended that DOE carefully evaluate AHAM’s dataset and integrate it with its own data in order to update its analysis. (Id.) ASAP et al. commented that they support DOE’s approach to use the market cluster approach outlined in EPCA to develop efficiency levels. (ASAP et al., No. 37 at p. 1) The CA IOUs expressed concern that for the top-loading compact product class, the IMEF versus EER and IWF versus WER translations indicate opposite trends compared to the other three product classes, showing a negative relationship between IMEF and EER and a positive relationship between IWF and WER. (CA IOUs, No. 43 at p. 3) PO 00000 Frm 00037 Fmt 4701 Sfmt 4702 13555 Following publication of the September 2021 Preliminary Analysis, DOE published the April 2022 NODA, which presented the results of additional testing conducted in furtherance of the development of the translations between the current test procedure and the proposed new test procedure. 87 FR 21816. The improved translation equations addressed the concerns expressed by commenters regarding the translations presented in the September 2021 Preliminary Analysis. The following section summarizes the translation approach presented in the April 2022 NODA. b. NODA Approach In the April 2022 NODA, DOE published updated translation equations that were developed using data points from the 44 units it tested to both appendix J2 and appendix J. In a separate spreadsheet accompanying the April 2022 NODA and available in the rulemaking docket, DOE also published the underlying test results for each RCW model in its test sample. 87 FR 21816, 21817. The April 2022 NODA summarized analyses of RMC and water fill control system (‘‘WFCS’’) type, which DOE tentatively determined have a significant impact on these translation equations. Id. To account for the impacts of RMC, DOE developed values for ‘‘adjusted’’ EER based on an ‘‘adjusted’’ RMC, which is equivalent to the RMC value measured under appendix J2 plus 4 percentage points. Id. To account for the difference in efficiency level correlation between clothes washers with automatic and manual WFCS, DOE presented an alternate set of translation equations that separate top-loading portable RCWs (which use manual WFCS) from toploading stationary RCWs (which provide either automatic WFCS or both manual and automatic WFCSs). 87 FR 21816, 21820. The following sections summarize the adjusted RMC approach presented in the April 2022 NODA. As discussed previously, RMC is a significant contributor to both the IMEF and EER metrics. The approach presented in the April 2022 NODA provides the foundation for the approach used for this NOPR, as discussed further in section IV.C.5.c of this document. i. Adjusted RMC The following paragraphs explain the difference in RMC measurement methodology between appendix J2 and appendix J. This difference in methodology underlies DOE’s careful consideration of RMC in developing the metric translation equations. E:\FR\FM\03MRP2.SGM 03MRP2 13556 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules ddrumheller on DSK120RN23PROD with PROPOSALS2 As discussed, the RMC is a measure of the amount of water remaining in the clothing load after completion of the clothes washer cycle. The RMC value is used to calculate the total per-cycle energy consumption for removal of moisture from the clothes washer test load in a clothes dryer to an assumed final moisture content, i.e., the ‘‘drying energy,’’ which is one of the factors contained within both the IMEF and EER metrics. Lower values of RMC result in less drying energy and thus represent more-efficient performance. Section 3.8.2 of appendix J2 requires that the RMC be calculated based on a test run with the maximum load size on the Cold Wash/Cold Rinse (‘‘Cold/ Cold’’) temperature selection. Section 3.8.4 of appendix J2 requires that for clothes washers that have multiple spin settings 49 available within the energy test cycle that result in different RMC values, the maximum and minimum extremes of the available spin settings must be tested with the maximum load size on the Cold/Cold temperature selection.50 In this case, the final RMC is the weighted average of the maximum and minimum spin settings, with the maximum spin setting weighted at 75 percent and the minimum spin setting weighted at 25 percent. In contrast, appendix J requires measuring RMC on each of the energy test cycles (i.e., each load size and each wash/rinse temperature combination included for testing) using the default spin setting. On some clothes washers, the default spin setting is not the maximum spin setting. In section 4.3 of appendix J, the final RMC is calculated by weighting the individual RMC measurements using the same temperature and load size weighting factors that apply to the water and energy measurements. As discussed in the April 2022 NODA, multiple factors can affect the RMC of a particular cycle, including the spin speed and the duration of the spin portion of the wash cycle. 87 FR 21816, 21818. The size of the load can also affect RMC—generally, larger load sizes result in lower (better) RMC values, whereas smaller load sizes result in higher (worse) RMC values. Id. These 49 The term ‘‘spin settings’’ refers to spin times or spin speeds. The maximum spin setting results in a lower (better) RMC. 50 On clothes washers that provide a Warm Rinse option, appendix J2 requires that RMC be measured on both Cold Rinse and Warm Rinse, with the final RMC calculated as a weighted average using TUFs of 73 percent for Cold Rinse and 27 percent for Warm Rinse. DOE has observed very few RCW models on the market that offer Warm Rinse. For simplicity throughout this discussion, DOE references the testing requirements for clothes washers that offer Cold Rinse only. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 factors result in different measured RMC values for appendix J and appendix J2, specifically because under appendix J, RMC is measured across a wider range of cycles (compared to only the Cold/ Cold cycle in appendix J2) and because the appendix J load sizes are smaller than the appendix J2 maximum load size (on which the appendix J2 RMC measurement is based). Id. In the interest of improving the translation equations as presented in the September 2021 Preliminary Analysis, DOE conducted an in-depth analysis of the differences in RMC between the appendix J2 and proposed appendix J test procedures. Id. For each unit that DOE tested, DOE examined the cycleby-cycle test results to determine the key driver behind the difference in RMC when testing to appendix J as compared to appendix J2. Id. Based on this analysis, DOE identified three categories of spin implementations that result in differences between the appendix J RMC value and the appendix J2 RMC value, described as follows. • The first type, referred to as ‘‘consistent spin’’ throughout the remainder of this NOPR, is illustrative of units in which the characteristics of the spin cycle (e.g., spin speed, spin time) are consistent across temperature selections. On these units, RMC values measured on Warm/Cold, Hot/Cold, and Extra Hot/Cold cycles are substantially similar to the RMC value measured on the Cold/Cold cycle.51 • The second type, referred to as ‘‘Cold/Cold optimized spin’’ throughout the remainder of this NOPR, is illustrative of units in which the spin cycle is optimized on the Cold/Cold setting with maximum load size, corresponding to the one cycle combination for which RMC is measured under appendix J2. On these units, the spin portion of the cycle is significantly faster or longer on either the Cold/Cold setting, when using a maximum load size, or both as compared to the other temperature settings or load sizes that are tested as part of the energy test cycle. • The third type, referred to as ‘‘nondefault maximum spin’’ throughout the remainder of this NOPR, is illustrative of units in which the maximum spin speed setting (which is tested under appendix J2) is not the default spin speed setting on the Normal cycle. On these units, the default spin speed 51 DOE notes that the ‘‘consistent spin’’ designation is not meant to exclude clothes washers that offer multiple spin speed settings on the Normal cycle. Rather, the term ‘‘consistent’’ refers to a particular spin speed setting demonstrating substantially similar performance regardless of which wash/rinse temperature is selected. PO 00000 Frm 00038 Fmt 4701 Sfmt 4702 setting tested under appendix J would provide a lower-speed spin or a shorter spin portion of the cycle. Id. For clothes washers with ‘‘consistent spin,’’ the only source of difference between the measured RMC values under appendix J and appendix J2 is the use of smaller load sizes for appendix J. Id. The observed difference in RMC between the two test procedures is relatively consistent among models from different manufacturers of RCWs with this characteristic, as discussed further in this section. Id. For clothes washers with ‘‘Cold/Cold optimized spin’’ the difference between the measured RMC values under appendix J and appendix J2 is due to a combination of both the smaller load sizes for appendix J and the different spin behavior on the temperature settings other than Cold/Cold. Id. The observed difference in RMC between the two test procedures varies significantly among models from different manufacturers of RCWs with ‘‘Cold/ Cold optimized spin,’’ depending on the degree to which the Cold/Cold RMC differs from the RMC on all other tested cycles. Id. For clothes washers with ‘‘non-default maximum spin,’’ the difference between the measured RMC values under appendix J and appendix J2 is due to a combination of both the smaller load sizes for appendix J and the different spin behavior on the maximum and default spin settings. Id. Similar to units with ‘‘Cold/Cold optimized spin,’’ the observed difference in RMC between the two test procedures varies significantly among models from different manufacturers of RCWs with ‘‘nondefault maximum spin,’’ depending on the degree to which the maximum spin setting differs from the default spin setting. Id. As discussed, the RMC value is the most significant contributor to both the IMEF metric measured by appendix J2 and the EER metric measured by appendix J. Id. Because of the more significant variation in RMC between the two test procedures for ‘‘Cold/Cold optimized spin’’ and ‘‘non-default maximum spin’’ units, the correlation between IMEF and EER for these units is less strong (i.e., lower ‘‘R-squared’’ values for the best-fit line) than for ‘‘consistent spin’’ units. Id. at 87 FR 21819. To investigate strategies for defining translation equations with a stronger correlation between IMEF and EER, DOE developed a second set of EER values based on an ‘‘adjusted’’ RMC value (substituted for the measured RMC value) that assumes a ‘‘consistent spin’’ characteristic for each unit in the E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules test sample. Id. Under this approach, only the change in load size would be assumed to impact the RMC values measured under appendix J as compared to appendix J2. Id. DOE’s test data indicated that the smaller load sizes under appendix J result in an increase in RMC of 4 percentage points compared to the RMC values measured under appendix J2 using the maximum load size. Id. Therefore, for this approach, DOE calculated an ‘‘adjusted RMC’’ for each unit as the tested RMC value under appendix J2 plus 4 percentage points. Id. DOE substituted this adjusted RMC for the RMC value in the drying energy equation within the EER calculation. Id. As demonstrated in the second set of ‘‘adjusted’’ translation plots, this approach produced translation equations with significantly higher R-squared values, indicating a stronger correlation between IMEF and EER. Id. Comments submitted by a manufacturer in response to the September 2021 NOPR suggested that, were DOE to amend standards based on appendix J as proposed, manufacturers that currently use ‘‘Cold/Cold optimized spin’’ or ‘‘non-default maximum spin’’—which yield lower (i.e., better) RMC values on the Cold/Cold temperature setting compared to RMC values obtained using the other temperature settings for RCWs with ‘‘Cold/Cold optimized spin,’’ and on the maximum spin setting for RCWs with ‘‘non-default maximum spin’’—would likely implement similar strategies to decrease the RMC across all cycles required for testing under appendix J. (EERE–2016–BT–TP–0011, Whirlpool, No. 26 at p. 8–9). Specifically, for ‘‘Cold/Cold optimized spin’’ units, manufacturers would likely increase the spin speeds or spin durations across all temperature settings to match the spin behavior of the Cold/Cold temperature setting. For ‘‘non-default maximum spin’’ units, manufacturers would likely make the maximum spin speed the default spin setting to provide the lowest possible (i.e., best possible) RMC measurement under appendix J. In response to stakeholder questions, DOE published a supplemental data report providing additional details as to how it calculated an average increase in RMC of 4 percentage points due to the smaller load sizes defined in appendix J.52 DOE investigated two separate methods for determining the impact of test load size on RMC. Both methods 52 Available at www.regulations.gov/document/ EERE-2017-BT-STD-0014-0048. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 yielded nearly identical results, as described in the following paragraphs. For Method 1, DOE compared the final corrected RMC values obtained under both test procedures for only those units that DOE designated as having a ‘‘consistent spin’’ spin implementation. As described, units designated as ‘‘consistent spin’’ demonstrate key characteristics of the spin cycle (e.g., spin speed, spin time) that are consistent across temperature selections; as such, DOE expects that for these units, the difference between the two final RMC values is due primarily to the difference in load sizes between the two test procedures. Among all the ‘‘consistent spin’’ units in the test sample, appendix J yielded a final RMC value 3.7 percentage points higher than appendix J2, on average. For Method 2, DOE measured and compared the cycle-specific corrected RMC values for only the following specific Cold/Cold cycles: the appendix J2 Cold/Cold cycle with a maximum load size and default spin settings; the appendix J Cold/Cold cycle with a large load size and default spin settings; and the appendix J Cold/Cold cycle with a small load size and default spin settings. These three cycles differ only in load size, such that the differences between the RMC values are due primarily to the difference in load sizes. DOE first calculated the average RMC value of these two appendix J cycles (consistent with the equivalent load weighting factors for the large and small load sizes defined by appendix J) and compared the resulting value to the RMC value for this appendix J2 cycle. Among all the units in the test sample, this approach indicated that the average of the large and small load sizes under appendix J yielded a final RMC value 3.8 percentage points higher than the maximum load size under appendix J2, on average. In summary, the results from both Method 1 and Method 2 suggest that the smaller load sizes under appendix J result in an increase in RMC of approximately 4 percentage points, on average, compared to the RMC values measured under appendix J2 using the maximum load size. In the April 2022 NODA, DOE requested comment on whether, if DOE were to establish amended RCW standards based on appendix J as proposed, manufacturers that currently use the ‘‘Cold/Cold optimized spin’’ strategy for their RCWs would modify the spin behavior across all temperature settings to match the spin behavior of the Cold/Cold temperature setting; and whether manufacturers that currently use the ‘‘non-default maximum spin’’ PO 00000 Frm 00039 Fmt 4701 Sfmt 4702 13557 strategy for their RCWs would design the maximum spin speed to be the default spin setting. DOE further requested comment on the impact of such changes to the energy and water use, other aspects of consumer-relevant performance, and life-cycle cost of RCWs. 87 FR 21816. The CA IOUs commented that all three of the spin strategies identified by DOE are currently on the market, and that identification of these three types of RMC strategies implemented in products currently on the market shows the value that appendix J will provide, in contrast to products optimized for the appendix J2 test rather than what the CA IOUs characterized as ‘‘real-world’’ operation. (CA IOUs, No. 52 at pp. 1– 2) According to ComEd and NEEA, NEEA’s testing of 12 clothes washers representing more than 20 percent of sales from May 2018 to April 2019 confirms DOE’s three spin implementation types for stationary RCWs; therefore, ComEd and NEEA encouraged DOE to continue to use these spin profiles. (ComEd and NEEA, No. 50 at p. 3) ComEd and NEEA commented that they agree with DOE’s assumption that manufacturers will likely maintain a similar measured efficiency of RCWs with the transition to appendix J, and they support DOE’s assumption that manufacturers will modify RCWs to spin consistently across all cycles tested, enabling a comparable RMC and drying energy under appendix J. (ComEd and NEEA, No. 50 at pp. 2–4) According to ComEd and NEEA, most RCWs have a delicate wash program that consumers can use for textiles that may not be able to withstand higher spin speeds or longer spin durations, such that ComEd and NEEA do not expect changes to RMC as a result of appendix J to impact RCW utility. (Id.) For these reasons, ComEd and NEEA supported DOE’s approach to developing the adjusted appendix J efficiency values proposed in the April 2022 NODA and encouraged DOE to employ the adjusted appendix J efficiency values to develop future candidate standards levels for RCW. (Id.) ASAP et al. expressed support for DOE’s April 2022 NODA approach to develop a more robust translation of RCW energy and water usage metrics from the current appendix J2 to the new appendix J test procedure. (ASAP et al., No. 51 at pp. 1–2) Specifically, ASAP et al. expressed support for the approach of developing translations and resulting ELs based on adjusted RMC given the significant impact of RMC on overall E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 13558 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules energy usage and resulting efficiency ratings. (Id.) ASAP et al. commented that given Whirlpool’s comments suggesting that manufacturers with RCWs optimized for the appendix J2 spin settings would likely re-program these units to perform better when tested under new appendix J, ASAP et al. find it reasonable to assume that manufacturers would modify RCW spin settings if DOE were to establish amended standards based on the new appendix J. (Id.) AHAM commented in response to the September 2021 Preliminary Analysis that DOE’s proposed changes to the load sizes in new appendix J would lead to an increase in RMC. (AHAM, No. 40 at pp. 9–10) AHAM noted that accordingly, manufacturers would need to increase spin speed and spin times to compensate for this change so that they continue to comply with future energy conservation standards. (Id.) In response to the April 2022 NODA, AHAM presented data that examined the corrected RMC of units with ‘‘consistent spin,’’ including units that were tested by both AHAM and DOE. (AHAM, No. 53 at pp. 8–10) AHAM’s data presented RMC for each unit as tested to appendix J2 and appendix J, and the difference between those values for each unit. (Id.) AHAM noted that when only considering units tested by AHAM, the average difference in RMC is 5.9 percent,53 as opposed to the 3.7 percent average RMC difference calculated when only using the units in DOE’s test sample from the April 2022 NODA. (Id.) AHAM also noted that when the AHAM and DOE datasets are combined, the average RMC difference is 4.7 percent. (Id.) AHAM commented that the difference in averages show that average RMC difference is subject to changes in sample content and size. (Id.) AHAM also commented that the range of RMC differences is wide. (Id.) AHAM noted that DOE’s sample ranges from –1.6 to 11.3 percent difference, AHAM’s sample ranges from –1.0 percent to 16.4 percent difference, and the combined sample has a range of –1.6 to 16.4 percent difference. (Id.) AHAM further commented that the models were welldistributed throughout the range and that the end points of this range are not outliers. (Id.) AHAM commented that due to the wide range of differences in RMC between appendix J2 and appendix J testing among units in AHAM’s and DOE’s test samples, in AHAM’s opinion, the average is not representative of the range of differences in the data. (AHAM, 53 DOE uses the term ‘‘percent’’ in this context to refer to RMC percentage points. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 No. 53 at p. 10) AHAM also added that the average difference in RMC is highly susceptible to change depending on which and how many units are included in the dataset, which demonstrates that the average is not a reliable value for determining an ‘‘adder’’ to account for design optimization to the new test procedure. (Id.) AHAM commented that without a proven translation between appendix J2 and appendix J, DOE has no reliable means to estimate energy savings from its incremental efficiency levels until it can conduct testing or receive test data to assist in reestablishing the baseline. (Id.) AHAM commented that without a finalized test procedure to consider during the majority of the April 2022 NODA comment period and during the September 2021 Preliminary Analysis comment period, it was impossible to evaluate the percentage that would be appropriate for RMC adjustment, when the test procedure could change from DOE’s proposal. (AHAM, No. 53 at p. 12) AHAM commented that even if an RMC adjustment is an appropriate approach for developing a translation between appendix J2 and appendix J, it does not change the overall concerns AHAM has with appendix J. (Id.) AHAM recommended that, now that DOE has finalized the test procedure, DOE should collect data to determine whether a translation equation or adjustment factor are possible and, if not, collect data to reestablish the baseline. (Id.) AHAM further commented that without a proven translation between appendix J2 and appendix J, DOE has no reliable means to estimate energy savings from its incremental efficiency levels until it can conduct testing or receive test data to assist in reestablishing the baseline. (AHAM, No. 53 at p. 10) AHAM also commented that DOE needs to further investigate the impact of the change from capacitybased efficiency metrics to load-size based efficiency metrics. (Id.) In response to AHAM’s comment regarding the specific value of the ‘‘adjusted’’ RMC adder determined in the April 2022 NODA, DOE has closely reviewed AHAM’s RMC data to understand the reason for the larger average difference between the test procedures than was observed in DOE’s data. DOE also closely re-examined its own data, as presented in appendix 5A of the NOPR TSD. The following paragraphs summarize DOE’s key conclusions from this analysis. DOE notes that in both datasets, any differences above 10 percent appear to be outliers, as evidenced by a large gap in data points between 6 percent and 11 PO 00000 Frm 00040 Fmt 4701 Sfmt 4702 percent (whereas the data points less than 6 percent are fairly evenly distributed around the mean of 4 percent). DOE re-evaluated the unit in its test sample with an RMC difference of 11.1 percent. Upon closer examination, DOE determined that this unit was incorrectly characterized in the April 2022 NODA as having a ‘‘consistent spin’’ spin implementation. Upon closer examination of the time series power data for each cycle, this unit exhibits ‘‘Cold/Cold optimized spin’’ behavior and therefore should be excluded from consideration for the purpose of determining an RMC adjustment factor based on load size differences alone. Although DOE does not have access to the time series power data underlying AHAM’s data submission, DOE’s determination that the outlier unit in DOE’s test sample was incorrectly categorized suggests that the outlier units in AHAM’s sample may also be incorrectly categorized as having ‘‘consistent spin’’ spin implementation. As discussed, given the large gap in data points between 6 percent and 11 percent, and given DOE’s determination that it had incorrectly categorized its unit at 11 percent, DOE tentatively determines that the outlier data points above 11 percent very likely do not represent units with ‘‘consistent spin’’ spin implementation and therefore should be excluded from the analysis to determine an RMC adjustment factor based on load size differences alone. Excluding such data points, DOE notes that the revised mean of DOE’s dataset would be 3.4 percent. Excluding the values 12.1, 15.8, and 16.3 from AHAM’s dataset, the revised mean would be 3.7 percent. Considering both datasets together, the revised mean of the joint dataset would be 3.5 percent. Based on this analysis, DOE tentatively determines that a 4percentage-point adder (rounded to the nearest whole number) provides a representative estimate of the change in RMC between the two test procedures due to only the change in load size. In this NOPR, DOE maintains use of the 4percentage-point adder to calculate ‘‘adjusted RMC’’ for the purposes of developing translation equations. ii. NODA Translation Equations In the April 2022 NODA, DOE presented several versions of the translation equations that DOE could consider using to define potential higher efficiency levels based on the new EER and WER metrics. In particular, for the top-loading standard-size product class, DOE presented potential translations based on data points for all E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules configurations as well as separate translations specific to stationary units with automatic WFCS and portable units with manual WFCS. In response to the April 2022 NODA, AHAM presented data showing the Rsquared values for the translation equations developed using DOE’s data from the April 2022 NODA and using AHAM’s data. (AHAM, No. 53 at p. 11) AHAM commented that the R-squared value for ‘‘top-loading, standard, all configurations’’ is very low, and that there is not a meaningful improvement using the adjusted RMC approach using DOE’s data alone, or the combined AHAM and DOE dataset. (Id.) AHAM commented that it understands that DOE’s 4-percent adjustment in RMC was developed only to account for changes in tested spin speeds between appendix J2 and appendix J. (AHAM, No. 53 at p. 11) However, AHAM noted that there could be other design changes manufacturers would employ to account for the new test procedure. (Id.) AHAM added that DOE indicated that it did not consider other potential design changes. (Id.) AHAM added that it is inappropriate for a test procedure to drive design changes in and of itself. (Id.) AHAM commented that it does not believe at this time that the translation equation can adequately address all models or changes in the test procedure to serve as a replacement for reestablishing the baseline through test data. (Id.) AHAM recommended that should DOE pursue a translation equation despite AHAM’s comments that doing so is not supported by available data, DOE should consider design changes other than spin speed because spin speeds are not the only thing manufacturers will need to change in product design due to the new test procedure. (Id.) DOE acknowledged in the April 2022 NODA that for the top-loading standardsize product class, each of the separate translation equations has a stronger correlation (i.e., higher R-squared value) than the single translation equation in which top-loading portable and toploading stationary products are combined. 87 FR 21816, 21820. DOE notes that the combined dataset for the top-loading standard-size sample contained 12 stationary units (representing 71 percent of the sample) and 5 portable units (representing 29 percent of the sample). Shipment data submitted by AHAM indicates that toploading portable clothes washers represent approximately 1 percent of the top-loading market. This indicates that 13559 the portable configuration was significantly over-sampled within the combined dataset. For this NOPR, DOE proposes to use datapoints representing only stationary units to develop the translation equations for the top-loading standardsize product class, on the basis that these units’ characteristics are significantly more representative of the market than the portable configuration. Appendix 5A of the NOPR TSD provides further details and discussion of the development of the translation equations for this NOPR. c. NOPR Approach For this NOPR, DOE used the ‘‘adjusted EER’’ approach presented in the April 2022 NODA to define the translation between the appendix J2 and appendix J metrics for this NOPR. Additionally, as discussed further in appendix 5A of the NOPR TSD, DOE used AHAM’s dataset to confirm the accuracy and appropriateness of these translation equations. Table IV.27 through Table IV.30 show the efficiency level translations considered in this NOPR based on the updated efficiency metric translations presented in chapter 5 of the NOPR TSD. TABLE IV.27—TOP-LOADING, ULTRA-COMPACT (<1.6 ft3) EFFICIENCY LEVEL TRANSLATIONS IMEF (ft3/kWh/cycle) EL Efficiency level description Baseline ......... Current DOE standard ......................................... 1.15 IWF (gal/cycle/ft3) EER (lb/kWh/cycle) 12.0 3.79 WER (lb/gal/cycle) 0.29 TABLE IV.28—TOP-LOADING, STANDARD-SIZE (≥1.6 ft3) EFFICIENCY LEVEL TRANSLATIONS IMEF (ft3/kWh/cycle) EL Efficiency level description Baseline ......... 1 ..................... 2 ..................... 3 ..................... 4 ..................... Current DOE standard ......................................... Gap fill ................................................................. ENERGY STAR v. 8.1 ......................................... 2015–2017 CEE Tier 1 ........................................ Maximum available (2016/2017 ENERGY STAR Most Efficient). 1.57 1.82 2.06 2.38 2.76 IWF (gal/cycle/ft3) EER (lb/kWh/cycle) 6.5 5.4 4.3 3.7 3.2 3.50 3.89 4.27 4.78 5.37 WER (lb/gal/cycle) 0.38 0.47 0.57 0.63 0.67 ddrumheller on DSK120RN23PROD with PROPOSALS2 TABLE IV.29—FRONT-LOADING, COMPACT (<3.0 ft3) EFFICIENCY LEVEL TRANSLATIONS IMEF (ft3/kWh/cycle) EL Efficiency level description Baseline ......... Current DOE standard for front-loading, standard-size (≥1.6 ft3). ENERGY STAR v. 8.1 level for units ≤2.5 ft3 ..... 2023 ENERGY STAR Most Efficient for units ≤2.5 ft3. Gap fill ................................................................. Maximum available (ENERGY STAR v. 8.1 level for units >2.5 ft3). 1 ..................... 2 ..................... 3 ..................... 4 ..................... VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 PO 00000 Frm 00041 Fmt 4701 IWF (gal/cycle/ft3) EER (lb/kWh/cycle) WER (lb/gal/cycle) 1.84 4.7 4.41 0.53 2.07 2.20 4.2 3.7 4.80 5.02 0.62 0.71 2.50 2.76 3.5 3.2 5.53 5.97 0.75 0.80 Sfmt 4702 E:\FR\FM\03MRP2.SGM 03MRP2 13560 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules TABLE IV.30—FRONT-LOADING, STANDARD-SIZE (≥3.0 ft3) EFFICIENCY LEVEL TRANSLATIONS Efficiency Level Description Baseline ......... 1 ..................... 2 ..................... 3 ..................... 4 ..................... ENERGY STAR v. 7.0 ......................................... Gap fill ................................................................. ENERGY STAR v. 8.1 ......................................... 2023 ENERGY STAR Most Efficient ................... Maximum available .............................................. d. Alternative Approaches For this NOPR, DOE analyzed the efficiency levels determined by the dataset, translation equations, and baseline definition approach previously presented in section IV.C.5.c. However, DOE is also considering alternate approaches for each of these components (i.e., the dataset to use, the method of defining translation equations, and the method for defining baseline) as well as any combination thereof, as described in the following sections. i. Joint DOE–AHAM Dataset As discussed, AHAM has shared RCW test data with DOE, which DOE used to confirm the accuracy and appropriateness of the NOPR translation equations. As discussed in appendix 5A of the NOPR TSD, DOE considered developing alternate translation equations using the joint dataset containing both DOE and AHAM test data. However, neither the DOE dataset nor the AHAM dataset identifies the individual model numbers of each unit in the sample; therefore, DOE cannot ascertain whether the joint dataset double-counts any individual models. For this reason, DOE has tentatively determined to not use translation equations based on the joint dataset in this NOPR. Rather, DOE has overlayed the AHAM data onto the translation equations developed using DOE’s dataset in order to confirm that the AHAM and DOE datasets exhibit consistent trends, as discussed further in appendix 5A of the NOPR TSD. DOE seeks comment on its tentative determination to use the DOE dataset as the basis for the translation equations rather than use the joint DOE–AHAM dataset. ddrumheller on DSK120RN23PROD with PROPOSALS2 IMEF (ft3/kWh/cycle) EL ii. Merging Compact and Standard-Size Translation Equations The CA IOUs suggested that DOE eliminate the standard-size and compact product classes when developing both the ‘‘best-fit line method’’ and the ‘‘average performance and market cluster method’’. (CA IOUs, No. 43 at pp. 2–3) The CA IOUs stated that segmenting product classes into VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 IWF (gal/cycle/ft3) 2.38 2.60 2.76 2.92 3.10 standard-size and compact arbitrarily separates products at a discrete product capacity and assumes that the relationship of IMEF to EER and IWF to WER is impacted by assignment to compact and standard-size categories. (Id.) The CA IOUs commented that while product classes can be useful for categorization, this categorization should not be confused for statistically justifiable clusters when conducting a translation analysis. (Id.) The CA IOUs commented that, although it may be appropriate to segment the data by product classes or a subset of unique performance attributes (such as toploading versus front-loading), these performance attributes should be demonstrated with supporting analysis. (Id.) The CA IOUs suggested that a statistical clustering analysis such as kmeans clustering could be used to show that the relationship between appendix J2 and appendix J metrics has fundamental differences that impact performance. (Id.) The CA IOUs commented that the separate categorization between compact and standard-size clothes washers assumes performance is impacted by product class alone, and that a k-means clustering would confirm if these four categories were statistically justified. (Id.) The CA IOUs stated that the relationship between appendix J2 and appendix J metrics could instead operate on a continuum based on capacity. (Id.) The CA IOUs commented that they believe that product performance is impacted by capacity, which exists along a continuum in alignment with the product performance relationship to capacity. (Id.) The CA IOUs also commented that they believe the relationship between the appendix J2 and appendix J metrics should be controlled along that same continuum of capacity, and requested that DOE provide the measured EERs and WERs of products tested to appendix J so that this hypothesis can be tested. (Id.) The CA IOUs commented that combining data between compact and standard-size product classes will improve model fits to be better than the models presented in the September 2021 Preliminary TSD. (Id.) The CA IOUS also commented that PO 00000 Frm 00042 Fmt 4701 Sfmt 4702 EER (lb/kWh/cycle) 3.7 3.5 3.2 3.2 2.9 5.02 5.31 5.52 5.73 5.97 WER (lb/gal/cycle) 0.64 0.69 0.77 0.77 0.85 combining data will address the lack of tested appendix J data in the top-loading compact product class. (Id.) DOE evaluated the CA IOUs’ suggestion to develop only two sets of translation equations (i.e., one per axis of loading) rather than four (i.e., one per product class). Appendix 5A of the NOPR TSD presents the detailed results of this analysis. DOE notes that automatic top-loading ultra-compact and automatic toploading standard-size clothes washers have significantly different operational characteristics (beyond just a difference in capacity), such that DOE does not expect that there should be a consistent correlation between appendix J2 and appendix J performance across the two product classes. For example, DOE has observed that the top-loading ultracompact units on the market offer only two wash temperatures (warm and cold), and as such, hot water heating energy makes up a significantly lower fraction of total energy compared to toploading standard-size units.54 Furthermore, although AHAM did not provide shipment data for the toploading ultra-compact product class, DOE expects that because these represent niche products, this product class likely represents less than 1 percent of total sales. If DOE were to combine the 2 top-loading ultracompact points with the 12 data points for top-loading standard-size units, the ultra-compact class would be significantly oversampled (e.g., 14 percent of the data versus less than 1 percent of sales). For these reasons, DOE is not proposing to use translation equations for top-loading product classes based on a single dataset that combines top-loading ultra-compact units with top-loading standard-size units. Similarly, for the front-loading product classes, if DOE were to combine its 13 front-loading compact points with 54 As shown in the energy breakdown tables in chapter 7 of the NOPR TSD, hot water heating energy represents 5 percent of the total energy for the top-loading ultra-compact product class. Whereas, for the baseline efficiency level in the toploading standard-size product class, hot water heating energy represents 16 percent of total energy use. E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules ddrumheller on DSK120RN23PROD with PROPOSALS2 its 12 front-loading standard-size points, the compact class would be significantly oversampled (e.g., 52 percent of the data versus 6 percent of shipments, based on AHAM data). For this reason, DOE is not proposing to use translation equations for front-loading product classes based on a single dataset that combines front-loading compact-size units with front-loading standard-size units. DOE seeks comment on its tentative determination not to merge the compact and standard-size translations, but to instead develop separate translations for each product class. iii. ‘‘Unadjusted’’ Baseline Approach The CA IOUs commented that DOE should base its translation analysis on currently available cycle settings and performance and not employ the proposed 4-percentage-point adjustment. (CA IOUs, No. 52 at pp. 1– 2) The CA IOUs added that using the performance of currently available products more accurately reflects realworld energy and water efficiencies. (Id.) The CA IOUs commented that based on manufacturer input identified by DOE, the CA IOUs understand DOE’s consideration that manufacturers may simply implement strategies similar to Cold/Cold optimized spin and nondefault maximum spin to decrease RMC. (Id.) The CA IOUs stated that while some manufacturers may take this approach, this presumption should not be used as part of the baseline translation for all products. (Id.) The CA IOUs further commented that improving the RMC of different cycle settings (e.g., operating small loads at higher spin speeds or software adjustments to optimize RMC for different wash/rinse temperatures) should be treated as a low-cost technology option for efficiency level development, and that DOE’s proposal of applying a 4percentage point adjustment to the tested RMC of appendix J2 (the RMC of appendix J plus the difference in RMC for the smaller loads tested under appendix J2) only accounts for the natural difference in load size centrifugal force using the same spin speed and duration, effectively removes small load RMC improvements as a technology option. (Id.) The CA IOUs noted that this adjustment does improve the R-squared, the coefficient of determination for the translation correlation, but at the expense of accurately representing the differences between appendix J and appendix J2, which is what appendix J is partly designed to capture. (Id.) The CA IOUs added that while a higher R-squared translation correlation is preferable, the VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 CA IOUs stated it should not be achieved at the expense of removing product-to-product variation that represents the real-world operation of available products. (Id.) ComEd and NEEA supported DOE’s efforts to develop a more robust translation from appendix J2 to appendix J and DOE’s general approach and methodology. (ComEd and NEEA, No. 50 at p. 2) However, ComEd and NEEA commented that NEEA estimates there will be 0.3 quads of newly realized real-world site energy savings achieved with this test procedure update that were counted earlier (by assuming a lower RMC across all cycles even though RMC was only tested on one cycle setting) but uncaptured in practice, and that this substantial energy savings is twice the site energy savings DOE calculated for EL 1 in the September 2021 Preliminary TSD. (Id.) ComEd and NEEA stated that this discrepancy validates DOE’s continued efforts to move forward with the translation analysis using appendix J. (Id.) ComEd and NEEA recommended that DOE not justify costs associated with the translation of spin implementations from appendix J2 to appendix J for three key reasons. (ComEd and NEEA, No. 50 at p. 4) First, for the most common RCW spin implementation (‘‘consistent spin’’), there is zero incremental cost to obtain the adjusted appendix J EER value because no design changes are needed to retain spin performance. (Id.) Second, for RCWs with ‘‘cold-cold optimized’’ spin and ‘‘non-default maximum’’ spin implementations, the incremental cost to achieve the adjusted appendix J EER value is nearly zero. (Id.) Third, these costs were already accounted for in the May 2012 Final Rule in the case of RCWs with increased spin time over the appliance lifetime whose manufacturers choose to upgrade to more durable components. (Id.) In response to the CA IOUs’ comments, DOE is also considering an alternate approach to the translation of IMEF to EER in which DOE would define the baseline efficiency level based on a translation between appendix J2 and appendix J metrics without consideration of any changes to spin implementations as a result of adopting the appendix J test procedure. EL 1, in contrast, would be represented by the baseline level presented in this NOPR (i.e., reflecting the 4 percent ‘‘adjusted RMC’’ approach). As suggested by the CA IOUs, this approach would allow for a more explicit consideration of savings that are likely to occur solely as a result of the switching from appendix J2 to appendix PO 00000 Frm 00043 Fmt 4701 Sfmt 4702 13561 J, as opposed to those savings already being reflected at baseline level. Appendix 5A of the NOPR TSD details the specific efficiency levels that could be defined for each front-loading product class using this approach. In response to ComEd and NEEA’s comment that DOE should not include the costs associated with changes to spin implementation as a result of the change in test procedure, DOE notes that all costs incurred by manufacturers in response to this NOPR have been included in this NOPR analysis. While there may be zero incremental manufacturing cost to changing spin implementation, such changes would incur product conversion costs, as discussed further in section IV.J.2.c of this document. With regard to the assertion that these costs were already accounted for in the May 2012 Final Rule, the standards enacted by the May 2012 Final Rule were based on a different test procedure (i.e., appendix J2) than the test procedure proposed as a basis for the amended standards in this NOPR (i.e., appendix J). To the extent that appendix J requires manufacturers to change designs of products as they currently exist in the market, such changes are justifiable in considering in this analysis, irrespective of the costs that may have been incurred previously by manufacturers as a result of product investments required to comply with the standards enacted by the May 2012 Final Rule. DOE seeks comment on whether it should consider defining an ‘‘unadjusted’’ baseline efficiency level based on a translation between appendix J2 and appendix J metrics without consideration of any changes to spin implementations as a result of adopting the appendix J test procedure. D. Markups Analysis The markups analysis develops appropriate markups (e.g., manufacturer markup, retailer markups, distributor markups, contractor markups) in the distribution chain and sales taxes to convert the MPC 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 business costs and profit margin. To account for manufacturers’ nonproduction costs and profit margin, DOE applies a multiplier (the manufacturer markup) to the MPC. The resulting manufacturer selling price (‘‘MSP’’) is the price at which the manufacturer distributes a unit into commerce. DOE developed an average manufacturer markup by examining the annual E:\FR\FM\03MRP2.SGM 03MRP2 13562 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules Securities and Exchange Commission (‘‘SEC’’) 10–K reports filed by publicly traded manufacturers primarily engaged in appliance manufacturing and whose combined product range includes RCWs.55 See chapter 12 of the NOPR TSD for additional detail on the manufacturer markup. For RCWs, the main parties in the post-manufacturer distribution chain are retailers/distributors and consumers. DOE developed baseline and incremental markups for each of these. Baseline markups are applied to the price of products with baseline efficiency, while incremental markups are applied to the 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 amended standards.56 DOE relied on economic data from the U.S. Census Bureau to estimate average baseline and incremental markups.57 Chapter 6 of the NOPR TSD provides details on DOE’s development of markups for RCWs. E. Energy and Water Use Analysis ddrumheller on DSK120RN23PROD with PROPOSALS2 The purpose of the energy and water use analysis is to determine the annual energy and water consumption of RCWs 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 RCW efficiency. The energy and water use analysis estimates the range of energy and water use of RCWs in the field (i.e., as they are actually used by consumers). The energy and water use analysis provides the basis for other analyses DOE performed, particularly assessments of the energy and water 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 and water consumption in the field for RCWs, DOE primarily used data 55 U.S. Securities and Exchange Commission, Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system. Available at www.sec.gov/edgar/ search/ (last accessed July 1, 2022). 56 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. 57 US Census Bureau, Annual Wholesale Trade Survey. 2017. Available at www.census.gov/awts (last accessed May 2, 2022). VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 from 2015 RECS.58 RECS is a national sample survey of housing units that collects statistical information on the consumption of and expenditures for energy in housing units along with data on energy-related characteristics of the housing units and occupants. The 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.59 DOE’s assumptions for establishing an RCW sample included the following considerations: • The household had a clothes washer. • Clothes washer use was greater than zero. DOE divided the sample of households into five sub-samples to characterize the product category being analyzed: standard-size or compact or semi-automatic, top-loading or frontloading RCWs. For compact and semiautomatic clothes washers, DOE developed a sub-sample consisting of households from multifamily buildings, manufactured homes, and single-family homes with less than 1,000 square feet and no garage or basement, since DOE reasoned that such products are most likely to be found in these housing types. The energy and water use analysis requires DOE to establish a range of total annual usage or annual number of cycles in order to estimate annual energy and water consumption by a clothes washer unit. DOE estimated the number of clothes washer cycles per year for each sample household using data given by RECS 2015 on the number of laundry loads washed (clothes washer cycles) per week. For each sample household, DOE estimated the field-based annual energy and water use of the clothes washer by multiplying the annual number of clothes washer cycles for each household by the per-cycle energy and water use values established by the engineering analysis (using the DOE test procedure) for each considered efficiency level. Per-cycle clothes washer energy use is calculated in the test procedure as the sum of per-cycle machine energy use associated with the clothes washer (including the energy used to heat water and remove moisture 58 U.S. Department of Energy—Energy Information Administration, Residential Energy Consumption Survey: 2015 Public Use Data Files, 2015. Available at www.eia.doe.gov/emeu/recs/ recspubuse15/pubuse15.html (last accessed May 12, 2022). 59 RECS 2015 is the most recent edition of RECS available at the time of this NOPR analysis. For the final rule analysis, DOE plans to use the microdata of the 2020 RECS. PO 00000 Frm 00044 Fmt 4701 Sfmt 4702 from clothing),60 and combined lowpower mode energy use. 1. Number of Annual Cycles The average annual energy and water consumption reflects an average annual weighted usage of 238 cycles per year (233 for top-loading clothes washers and 254 for front-loading clothes washers). This average usage is obtained from 2015 RECS.61 Ameren et al. recommended that DOE not use the number of annual clothes washer cycles predicted by the RECS methodology because it relies on participant recollection and is therefore subject to recall bias. They stated that a single RECS respondent may not accurately count cycles of other household members, leading to underestimates. (Ameren et al., No. 42 at pp. 16–17) RECS asks ‘‘In a typical week, about how many times is your clothes washer used?’’ A response does not require recollection of behavior in the distant past. DOE acknowledges that recall bias is in general an issue in surveys where consumers are asked about their past behavior, but DOE does not believe that RECS households would significantly underestimate the number of washer cycles. Ameren et al. encouraged DOE to increase the annual number of clothes washer cycles in its analysis and/or conduct its own field study to determine more accurately the average annual number of clothes washer cycles given that the RECS estimate is significantly lower than the annual number of cycles calculated in NEEA’s RBSA Laundry study published in 2014 (‘‘2014 Laundry Study’’).62 (Ameren et al., No. 42 at pp. 17–18) DOE reviewed the 2014 Laundry Study. Because the Study collected field metering data from 45 homes across three States, with more than 70 percent 60 The per-cycle energy consumption associated with a given clothes washer has three components: energy used for heating water, operating the machine, and drying the clothes. 61 DOE acknowledges that the value of 238 average annual cycles used in the Energy and Water Use Analysis differs from the value of 234 annual cycles used in appendix J. As discussed above, the value of 238 was determined while excluding RECS households that do not use their clothes washer (i.e., households with clothes washer use equal to 0 cycles per week) because these households’ clothes washers would not contribute to the nation’s total energy and water use. By comparison, the value of 234 used in appendix J did not exclude such households, because the test procedure is designed to represent the average household energy and water usage. 62 Hannas, B. and Gilman, L. 2014. RBSA Laundry Study (Report # E14–287). Portland, OR: Northwest Energy Efficiency Alliance. p. 38. 20 November. Retrieved from neea.org/resources/rbsa-laundrystudy. E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules of selected homes located in Washington State, it is not a representative sample of all U.S. households that use a clothes washer. The 2015 RECS is a nationally representative sample of U.S. households with more than 5,600 households with a clothes washer. For the final rule analysis, DOE plans to use the microdata of the 2020 RECS, which was released in July 2022 and contains a nationally representative sample of 18,500 occupied U.S. households. ddrumheller on DSK120RN23PROD with PROPOSALS2 2. Rebound Effect In calculating energy consumption of RCWs, DOE considered whether it would be appropriate to include a rebound effect (also called a take-back effect), which represents the increased energy consumption that can result from increases in energy efficiency and the associated reduction in operating costs. The rebound effect assumes that consumers will increase their overall annual usage of a more efficient product, thereby decreasing their overall annual savings. Ameren et al. commented in support of DOE’s determination that there is no rebound effect associated with more efficient clothes washers and agreed with DOE that consumers will not use their clothes washers more if the efficiency increases. (Ameren et al., No. 42 at p. 20) DOE requests comment and information on the specific efficiency levels at which any potential rebound effects may happen, as well as the magnitude of the effect. Chapter 7 of the NOPR TSD provides details on DOE’s energy and water use analysis for RCWs. 3. Water Heating Energy Use Per-cycle water heating energy consumption is one of the four energy components in the EER metric. Appendix J includes water-heating energy equations that estimate the energy required by the household water heater to heat the hot water used by the clothes washer. In section 4.1.2 of appendix J, the water heating energy consumption is calculated by multiplying the measured volume of hot water by a constant fixed temperature rise of 65 °F and by the specific heat of water. No efficiency or loss factor is included in this calculation, which implies an electric water heater efficiency of 100 percent. Ameren et al. presented data from 3 studies that contradict DOE’s assertion that 78 percent efficiency is typical for gas water heaters. Based on these 3 studies, Ameren et al. concluded that both market and field data analysis VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 reveal that typical gas water heater efficiency ranges from 62 to 70 percent. (Ameren et al., No. 42 at pp. 14–16) ASAP et al. commented that they believe DOE’s assumption of 100 percent efficiency for electric water heaters and 78 percent efficiency for gas water heaters is likely significantly overstating the efficiencies of water heaters in the field. ASAP et al. commented that based on shipment data from the last water heater rulemaking and current models in DOE’s CCD, the shipment-weighted efficiencies for new water heaters are about 92 percent for electric water heaters and 64 percent for gas water heaters. (ASAP et al., No. 37 at pp. 2–3) In the 2019 preliminary analysis for consumer water heaters, DOE calculated the energy use of water heaters using a simplified energy equation, the water heater analysis model (WHAM). WHAM accounts for a range of operating conditions and energy efficiency characteristics of water heaters. To describe energy efficiency characteristics of water heaters, WHAM uses three parameters that also are used in the DOE test procedure: recovery efficiency, standby heat-loss coefficient, and rated input power. The September 2021 Preliminary TSD states that DOE used a recovery efficiency of 78 percent for gas water heaters, not 0.78 Energy Factor for the calculation of hot water energy savings. The hot water energy savings are almost directly proportional to the recovery efficiency, and the NOPR analysis uses the most recent data reported for the 2022 consumer water heater rulemaking.63 ASAP et al. recommended that DOE clarify the hot water temperature rise estimate used in the hot water energy usage calculations and suggested that believe a value lower than 75 °F (e.g., 67.5 °F) would more accurately reflect hot water energy usage. (ASAP et al., No. 37 at p. 5) For this NOPR analysis, DOE revised hot water temperature rise from 75 °F to 65 °F based on the updates in the RCW test procedure. 87 FR 33316, 33326– 33327. 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 63 DOE, 2022–03 Preliminary Analysis Technical Support Document: Energy Efficiency Program for Consumer Products and Commercial and Industrial Equipment: Consumer Water Heaters, March 2022. EERE–2017–BT–STD–0019–0018. Available at: www.regulations.gov/document/EERE-2017-BTSTD-0019-0018 (last accessed June 21, 2022). PO 00000 Frm 00045 Fmt 4701 Sfmt 4702 13563 for RCWs. 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: • 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 and water 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. • 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 RCWs in the absence of 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 residential housing units. As stated previously, DOE developed household samples from the 2015 RECS. For each sample household, DOE determined the energy and water consumption for the RCWs and the appropriate energy and water prices. By developing a representative sample of households, the analysis captured the variability in energy and water consumption and energy and water prices associated with the use of RCWs. 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 and water consumption, energy and water 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 E:\FR\FM\03MRP2.SGM 03MRP2 13564 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules value, to account for their uncertainty and variability. The computer model DOE uses to calculate the LCC 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 RCW user samples. For this rulemaking, the Monte Carlo approach is implemented in MS Excel together with the Crystal BallTM add-on.64 The model calculated the LCC 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 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 consumers of RCWs as if each were to purchase a new product in the expected year of required compliance with amended standards. Amended standards would apply to RCWs 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 RCWs. Table IV.31 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.31—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 RS Means Residential Cost Data 2021. Assumed no change with efficiency level. Per cycle energy and water use multiplied by the cycles per year. Average number of cycles based on field data. Variability: Based on the 2015 RECS. Electricity: Based on EIA’s Form 861 data for 2021. Variability: Regional energy prices determined for 9 Census Divisions. Water: Based on 2020 AWWA/Raftelis Survey. Variability: Regional water prices determined for 4 Census Regions. Energy: Forecasted using AEO 2022 price forecasts. Water: Forecasted using BLS historic water price index information. Repair costs vary by product class and vary between ENERGY STAR and non-ENERGY START washers. Average: 13.7 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 and Water Use ....... Energy and Water Prices ................ Energy and water Price Trends ...... Repair and Maintenance Costs ...... Product Lifetime .............................. Discount Rates ................................ Compliance Date ............................ ddrumheller on DSK120RN23PROD with PROPOSALS2 * Not used for PBP calculation. 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. Ameren et al. encouraged DOE to calculate and consider the return on investment for each efficiency level in its analysis to add additional insight for stakeholders and decision-makers. Ameren et al. commented that efficiency improvements to an appliance can be considered capital investments, with ‘‘returns’’ being the money saved from utility bill reductions. (Ameren et al., No. 42 at pp. 18–19) DOE acknowledges that return on investment is a metric that can be useful in evaluating investments in energy efficiency. However, the measures that DOE has historically used to evaluate the economic impacts of standards on consumers—LCC savings and PBP—are more closely related to the language in EPCA that 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)) Therefore, DOE finds it reasonable to continue to use those measures. AHAM commented that DOE’s use of ‘‘Net Cost’’ for impacted households is incomplete and misleading. AHAM suggested that the ‘‘Net Cost’’ should be calculated only among the affected households. (AHAM, No. 40 at p. 21) DOE maintains that showing the share of all consumers who would experience a net LCC cost is useful information, as EPCA requires DOE to consider the impact of standards on ‘‘consumers,’’ not only those who would be affected by a standard. 64 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 July 6, 2022). VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 PO 00000 Frm 00046 Fmt 4701 Sfmt 4702 1. Consumer Product Cost To calculate consumer product costs, DOE multiplied the MPCs developed in the engineering analysis by the markups described in section IV.C.6 of this document (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 E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules ddrumheller on DSK120RN23PROD with PROPOSALS2 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.65 To derive the learning rate parameter for RCWs, 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 2019 from the Bureau of Labor Statistics’ (‘‘BLS’’) to form a time series price index representing household laundry equipment from 1948 to 2021.66 These two PPI series are the most current and disaggregated price index that includes RCWs, and DOE assumes that the price trend estimated from the household laundry equipment PPI is representative of that for RCWs. Inflation-adjusted price indices were calculated by dividing the PPI series by the gross domestic product index from Bureau of Economic Analysis for the same years. The estimated learning rate (defined as the fractional reduction in price expected from each doubling of cumulative production) is 14.4 ± 1.7 percent. See chapter 8 of the NOPR TSD for further details on this topic. Ameren et al. encouraged DOE to continue to apply a learning rate for product prices in its lifecycle cost and payback period analyses and encourages DOE to model as if RCW sales occurred before 1947, as this could produce a better fit to the model used and be more representative of the learning rate for the RCW industry. (Ameren et al., No. 42 at p. 19) The fit started in 1948 because that is the start year of the household laundry product PPI. In order to derive the corresponding cumulative productions, DOE performed a trend analysis to extrapolate shipments prior to AHAM historical data and determined the shipments were at a very low level and thus started the cumulative production accounting in 1948. DOE will explore alternative approaches for shipment extrapolation in the final rule analysis to better account for shipments prior to 1948 and improve the model fit. 65 Taylor, M. and Fujita, K.S. Accounting for Technological Change in Regulatory Impact Analyses: The Learning Curve Technique. LBNL– 6195E. Lawrence Berkeley National Laboratory, Berkeley, CA. April 2013. Available at escholarship.org/uc/item/3c8709p4#page-1. 66 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/. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 AHAM commented that equipment prices at EL 1 and EL 2 in the September 2021 Preliminary Analysis were underestimated and suggested that DOE use actual retail price differences between a baseline and higher efficiency level instead of taking the traditional approach of converting manufacturer production costs to consumer retail prices. (AHAM, No. 40 at p. 21) The actual retail price differences between a baseline and higher efficiency level may include the price for other features in addition to engineering designs relating to efficiency, and also reflects economies of scale in production, as well as marketing strategies and profit margins of manufacturers and retailers. DOE maintains that its traditional approach, which has been subject to peer review, is better able to identify the incremental costs that are only connected to higher efficiency. Furthermore, for this NOPR analysis, DOE revised the engineering costs of top-loading standard-size clothes washers, and the estimated equipment price difference between the baseline level and the ENERGY STAR level is now $163.50, before sales tax, which closely aligns with the retail price difference (i.e., $160 before sales tax) presented by AHAM. 2. Installation Cost Installation cost includes labor, overhead, and any miscellaneous materials and parts needed to install the product. DOE used data from 2021 RSMeans Residential Cost Data to estimate the baseline installation cost for RCWs.67 DOE found no evidence that installation costs would be impacted with increased efficiency levels. 3. Annual Energy and Water Consumption For each sampled household, DOE determined the energy and water consumption for an RCW at different efficiency levels using the approach described previously in section IV.E of this document. 4. Energy and Water Prices a. Energy Prices Because marginal electricity and gas prices more accurately captures the incremental savings associated with a change in energy use from higher efficiency, it provides a better representation of incremental change in consumer costs than average electricity and gas prices. Therefore, DOE applied 67 RS Means Company Inc., RS Means Residential Cost Data (2021). Available at https://rsmeans.com/ . PO 00000 Frm 00047 Fmt 4701 Sfmt 4702 13565 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 2021 using data from EEI Typical Bills and Average Rates reports for summer and winter 2021.68 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. For the residential sector, DOE calculated electricity prices using the methodology described in Coughlin and Beraki (2018).69 DOE obtained data for calculating regional prices of natural gas from the EIA publication, Natural Gas Navigator.70 This publication presents monthly volumes of natural gas deliveries and average prices by state for residential, commercial, and industrial customers. DOE used the complete annual data for 2020 to calculate an average annual price for each census division. Residential natural gas prices were adjusted by applying seasonal marginal price factors to reflect a change in a consumer’s bill associated with a change in energy consumed. EIA provides historical monthly natural gas consumption and expenditures by state. This data was used to determine 10-year average marginal price factors for the RECS 2015 census divisions, which are then used to convert average monthly natural gas prices into marginal monthly natural gas prices. DOE interpreted the slope of the regression line (consumption vs. expenditures) for each State as the marginal natural gas price factor for that State. DOE assigned average prices to each household in the LCC sample based on its location and its baseline electricity and gas consumption. For sampled households who were assigned a product efficiency greater than or equal to the considered level for a standard in the no-new-standards case, DOE 68 Edison Electric Institute. Typical Bills and Average Rates Report. Winter 2021, Summer 2021. Available at: www.eei.org/resourcesandmedia/ products/Pages/Products.aspx. 69 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. 70 U.S. Department of Energy—Energy Information Administration. Natural Gas Navigator 2020. Available at www.eia.gov/naturalgas/ data.php. E:\FR\FM\03MRP2.SGM 03MRP2 13566 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules ddrumheller on DSK120RN23PROD with PROPOSALS2 assigned marginal prices to each household based on its location and the decremented electricity and gas consumption. In the LCC sample, households could be assigned to one of nine census divisions. See chapter 8 of the NOPR TSD for details. To estimate energy prices in future years, DOE multiplied the average and marginal regional energy prices by the projection of annual average price changes for each of the nine census divisions from the Reference case in AEO2022, which has an end year of 2050.71 To estimate price trends after 2050, the 2046–2050 average was used for all years. b. Water and Wastewater Prices DOE obtained residential water and wastewater price data from the Water and Wastewater Rate Survey conducted by Raftelis Financial Consultants and the American Water Works Association.72 The survey covers approximately 194 water utilities and 140 wastewater utilities analyzing each industry (water and wastewater) separately. For each water or wastewater utility, DOE calculated the average price per unit volume by dividing the total volumetric cost by the volume delivered. DOE also calculated the marginal price by dividing the incremental cost by the increased volume charged at each consumption level. The samples that DOE obtained of the water and wastewater utilities is too small to calculate regional prices for all U.S. Census divisions. Therefore, DOE calculated regional costs for water and wastewater service at the Census region level (Northeast, South, Midwest, and West) by weighting each State in a region by its population. For this NOPR analysis, DOE also developed water prices for consumers who rely on private well water systems for their water needs rather than relying on the public supply system. DOE considered several factors when developing consumer prices for water supplied by private wells. Initial costs to install a well include well siting; well drilling; pump purchase and installation; water testing; and sometimes a water treatment system. Ongoing costs include pump maintenance; pump fuel to lift water to the surface and to the point of use or storage; plus, any required maintenance 71 EIA. Annual Energy Outlook 2022 with Projections to 2050. Washington, DC. Available at www.eia.gov/forecasts/aeo/ (last accessed June 14, 2022). 72 Raftelis Financial Consultants, Inc. 2020 RFC/ AWWA Water and Wastewater Rate Survey. 2021. Charlotte, NC, Kansas City, MO, and Pasadena, CA. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 of the treatment system (water-softening chemicals, filters, etc.). To determine the current percentage of the U.S. population served by private wells, DOE used historical American Housing Survey (‘‘AHS’’) data from 1970 to 2019 to develop a projection for 2027, the effective year of potential new standards for RCWs.73 DOE then weighted public utility water and wastewater prices and private well prices for each census region and derived weighted-average regional and national water price for residential consumers. To estimate the future trend for water and wastewater prices, DOE used data on the historic trend in the national water price index (U.S. city average) from 1988 through 2021 provided by the Labor Department’s BLS.74 DOE extrapolated the future trend based on the linear growth from 1988 to 2021. DOE used the extrapolated trend to forecast prices through 2050. To estimate price trend after 2050, DOE used a constant value derived from the average values from 2046 through 2050. AHAM commented that DOE’s water prices should include rural well and septic tank users. (AHAM, No. 40 at pp. 29–31) As described above, for this NOPR analysis, DOE developed water prices for rural well and septic tank users. DOE then weighted public utility water and wastewater prices and private well prices for each census region and derived weighted-average regional and national water price for residential consumers. Chapter 8 and Appendix 8E of the NOPR TSD provides further details on the methodology and sources DOE used to develop consumer water prices. 5. Repair and Maintenance 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. For RCWs, DOE determined repair cost associated with loading type and clothes washer capacity commonly found on an appliance repair website.75 73 The U.S. Census Bureau. The American Housing Survey. Years 1970–2019. Available at www.census.gov/programs-surveys/ahs.html (last accessed May 12, 2022). 74 U.S. Department of Labor-Bureau of Labor Statistics, Consumer Price Indexes, Item: Water and sewerage maintenance, Series Id: CUSR0000SEHG01, U.S. city average, 2021. Washington, DC. Available at www.bls.gov/cpi/ home.htm#data. 75 Fixr, How Much Does It Cost to Repair a Washing Machine? Available at www.fixr.com/ costs/washing-machine-repair#washing-machinerepair-cost-by-type-of-repair. PO 00000 Frm 00048 Fmt 4701 Sfmt 4702 DOE estimated the average repair cost for an RCW is about $225, ranging from $115 to $275. For maintenance cost, DOE conducted literature review of maintenance cost available from a variety of sources, including online resources. DOE estimated the annual maintenance cost for an RCW is approximately $25, including costs of clothes washer cleaners and of running clothes washer cleaning cycles. Typically, small incremental increases in product efficiency produce no, or only minor, changes in repair and maintenance costs compared to baseline efficiency products. For this NOPR analysis, DOE estimated that for repair costs, there is a cost difference between an ENERGY STAR and non-ENERGY STAR clothes washer of approximately $44 for a front-loading and $32 for a toploading clothes washer, based on information aggregated from confidential manufacturer interviews. For maintenance costs, DOE assumed that there is no change with efficiency level for RCWs. DOE requests comment and information on frequency of cleaning cycles run per number of cycles used to clean clothes and associated data as compared to the recommendations in the manufacturer’s use and care manuals. 6. Product Lifetime Product lifetime is the age at which an appliance is retired from service. Appliance magazine, a trade publication, provides estimates of the low, high, and average years of an appliance’s lifetime.76 The estimates, which are based on first-owner use of the product, represent the judgment of Appliance staff based on input obtained from various sources. The average lifetime estimate from Appliance magazine is 11 years. To determine estimates for RCW lifetime, DOE conducted an analysis of standard-capacity RCW lifetime in the field based on a combination of shipments data and data on the ages of the clothes washer products reported in the household stock from RECS conducted in 2001, 2005, 2009, and 2015 data.77 DOE also used the U.S. Census’s biennial AHS from 1974–2019, which surveys all housing, noting the 76 Appliance Magazine. A Portrait of the U.S. Appliance Industry: Market Share, Life Expectancy & Replacement Market, and Saturation Levels. 2014. 77 U.S. Department of Energy—Energy Information Administration, Residential Energy Consumption Survey (‘‘RECS’’), Multiple Years (1990, 1993, 1997, 2001, 2005, 2009, and 2015). Available at www.eia.gov/consumption/residential/ . E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules presence of a range of appliances.78 As described in chapter 8 of the NOPR TSD, the analysis yielded an estimate of mean age for standard-capacity RCWs of approximately 13.7 years. It also yielded a survival function that DOE incorporated as a probability distribution in its LCC analysis. Because the RECS data does not indicate whether the clothes washer has a toploading or front-loading configuration, DOE was not able to derive separate lifetime estimates for these two loading types. DOE did not receive any data or analysis to support separate lifetime for the different product classes. DOE requests comment and information on RCW lifetime. See chapter 8 of the NOPR TSD for further details on the method and sources DOE used to develop product lifetime. ddrumheller on DSK120RN23PROD with PROPOSALS2 7. Discount Rates In the calculation of LCC, DOE applies discount rates appropriate to RCWs to estimate the present value of future operating cost savings. DOE estimated a distribution of discount rates for RCWs 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.79 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 78 U.S. Census Bureau: Housing and Household Economic Statistics Division, American Housing Survey, Multiple Years (1974, 1975, 1976, 1977, 1978, 1979, 1980, 1981, 1983, 1985, 1987, 1989, 1991, 1993, 1995, 1997, 1999, 2001, 2003, 2005, 2007, 2009, 2011, 2013, 2015, 2017, and 2019). Available at www.census.gov/programs-surveys/ ahs/. 79 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. The implicit discount rate is not appropriate for the LCC analysis because it reflects a range of factors that influence consumer purchase decisions, rather than the opportunity cost of the funds that are used in purchases. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 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 triennial Survey of Consumer Finances (‘‘SCF’’) starting in 1995 and ending in 2019.80 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. AHAM and GEA suggested that DOE develop a more reasonable interest rate distribution for the low-income group that is closer to a credit card rate for this group. (AHAM, No. 40 at p. 27; GEA, No. 38 at p. 2) DOE maintains that the interest rate associated with the specific source of funds (e.g., credit card) used to purchase a clothes washer (i.e., the marginal rate) is not the appropriate metric to measure the discount rate as defined for the LCC analysis. The marginal interest rate alone would only be the relevant discount rate if the consumer were restricted from re-balancing their debt and asset holdings (by redistributing debts and assets based on the relative interest rates available) over the entire time period modeled in the LCC analysis. The LCC is not analyzing a marginal decision; rather, it estimates net present value over the lifetime of the product, therefore the discount rate needs to reflect the opportunity cost of both the money flowing in (through operating cost savings) and out (through upfront cost expenditures) of the net present value calculation. In the context of the LCC analysis, the consumer is not 80 The Federal Reserve Board, Survey of Consumer Finances (1995, 1998, 2001, 2004, 2007, 2010, 2013, 2016, and 2019). Available at: www.federalreserve.gov/econres/scfindex.htm. PO 00000 Frm 00049 Fmt 4701 Sfmt 4702 13567 only discounting based on their opportunity cost of money spent today, they are also discounting the stream of future benefits. A consumer might pay for an appliance with cash, thereby forgoing investment of those funds into one of the interest earning assets to which they might have access. Alternatively, a consumer might pay for the initial purchase by going into debt, subject to the cost of capital at the interest rate relevant for that purchase. However, a consumer will also receive a stream of future benefits in terms of annual operating cost savings that they could either put towards paying off that or other debts, or towards assets, depending on the restrictions they face in their debt payment requirements and the relative size of the interest rates on their debts and assets. All of these interest rates are relevant in the context of the LCC analysis, as they all reflect direct costs of borrowing, or opportunity costs of money either now or in the future. Additionally, while a clothes washer itself is not a readily tradable commodity, the money used to purchase it and the annual operating cost savings accruing to it over time flow from and to a household’s pool of debt and assets, including mortgages, mutual funds, money market accounts, etc. Therefore, the weighted-average interest rate on debts and assets provides a reasonable estimate for a household’s opportunity cost (and discount rate) relevant to future costs and savings. DOE maintains that the best proxy for this reoptimization of debt and asset holdings over the lifetime of the LCC analysis is to assume that the distribution of debts and assets in the future will be proportional to the distribution of debts and assets historically. Given the long time horizon modeled in the LCC, the application of a marginal rate alone would be inaccurate. DOE’s methodology for deriving residential discount rates is in line with the weighted-average cost of capital used to estimate commercial discount rates. For these reasons, DOE is maintaining its existing approach to 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 top-loading standardsize, front-loading compact and E:\FR\FM\03MRP2.SGM 03MRP2 13568 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules such as ENERGY STAR on RCWs. DOE estimated an annual efficiency improvement of 0.4 and 0.1 percent for top-loading standard-size and frontloading (compact and standard-size) clothes washers, respectively. For semiautomatic clothes washers, DOE used the CCD database to develop a product standard-size RCWs for 2027, DOE used shipments-weighted energy efficiency ratio (‘‘SWEER’’) for 2020 as a starting point, based on the information provided by AHAM. (AHAM, No. 54 at pp. 2–3) To project the trend in efficiency, DOE considered recent trends in DOE’s RCW CCD and the potential effect of labeling programs efficiency distribution under the nonew-standards case. The estimated market shares for the no-new-standards case for RCWs are shown in Table IV.32 and Table IV.33. See chapter 8 of the NOPR TSD for further information on the derivation of the efficiency distributions. TABLE IV.32—NO-NEW-STANDARDS CASE MARKET SHARE IN 2027: SEMI-AUTOMATIC AND TOP-LOADING RESIDENTIAL CLOTHES WASHERS Semi-automatic Top-loading, ultra-compact Top-loading, standard-size Efficiency level EER (lb/kWh/ cycle) WER (lb/gal/ cycle) Share (%) EER (lb/kWh/ cycle) WER (lb/gal/ cycle) Share (%) EER (lb/kWh/ cycle) Baseline ............. 1 ........................ 2 ........................ 3 ........................ 4 ........................ 1.60 2.12 2.51 ...................... ...................... 0.17 0.27 0.36 ...................... ...................... 21.0 71.0 8.0 ...................... ...................... 3.79 ...................... ...................... ...................... ...................... 0.29 ...................... ...................... ...................... ...................... 100 ...................... ...................... ...................... ...................... WER (lb/gal/ cycle) 3.50 3.89 4.27 4.78 5.37 Share (%) 0.38 0.47 0.57 0.63 0.67 61.0 5.9 27.4 4.7 1.0 TABLE IV.33—NO-NEW-STANDARDS CASE MARKET SHARE IN 2027: FRONT-LOADING RESIDENTIAL CLOTHES WASHERS Front-loading, compact Efficiency level EER (lb/kWh/cycle) ddrumheller on DSK120RN23PROD with PROPOSALS2 Baseline ............. 1 ......................... 2 ......................... 3 ......................... 4 ......................... WER (lb/gal/cycle) 4.41 4.80 5.02 5.53 5.97 0.53 0.62 0.71 0.75 0.80 The LCC Monte Carlo simulations draw from the efficiency distributions and randomly assign an efficiency to the RCW purchased by each sample household in the no-new-standards case. The resulting percent shares within the sample match the market shares in the efficiency distributions. AHAM objected to DOE’s use of random assignment of RECS households to baseline and higher efficiency levels, which assumes that consumers are agnostic to energy costs. AHAM stated that it is very unlikely that consumers with very high potential LCC savings would not have already decided to purchase a more efficient washer (i.e., in the no-new-standards case), and DOE’s assumption that these consumers are indifferent to operating costs appears contrary to common sense and experience in the retail field. AHAM stated that the most appropriate solution is to have a much more robust consumer choice theory. (AHAM, No. 40 at pp. 18–20) While DOE acknowledges that economic factors may play a role when consumers decide on what type of clothes washer to install, assignment of clothes washer efficiency for a given installation based solely on economic measures such as life-cycle cost or simple payback period most likely VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 Front-loading, standard-size Share (%) EER (lb/kWh/cycle) 0.0 38.7 45.8 14.5 1.0 5.02 5.31 5.52 5.73 5.97 would not fully and accurately reflect actual real-world installations. There are a number of market failures discussed in the economics literature that illustrate how purchasing decisions with respect to energy efficiency are unlikely to be perfectly correlated with energy use, as described further down. DOE maintains that the method of assignment is a reasonable approach and one that simulates behavior in the clothes washer market, where market failures result in purchasing decisions not being perfectly aligned with economic interests, more realistically than relying only on apparent cost-effectiveness criteria derived from the information in RECS. DOE further emphasizes that its approach does not assume that all purchasers of clothes washers make economically irrational decisions (i.e., the lack of a correlation is not the same as a negative correlation). By using this approach, DOE acknowledges the uncertainty inherent in the data and minimizes any bias in the analysis by using random assignment, as opposed to assuming certain market conditions that are unsupported given the available evidence. First, consumers are motivated by more than simple financial trade-offs. There are consumers who are willing to pay a premium for more energy-efficient PO 00000 Frm 00050 Fmt 4701 Sfmt 4702 WER (lb/gal/cycle) Share (%) 0.64 0.69 0.77 0.77 0.85 2.0 5.6 44.1 40.1 8.2 products because they are environmentally conscious.81 There are also several behavioral factors that can influence the purchasing decisions of complicated multi-attribute products, such as clothes washers. For example, consumers (or decision makers in an organization) are highly influenced by choice architecture, defined as the framing of the decision, the surrounding circumstances of the purchase, the alternatives available, and how they are presented for any given choice scenario.82 The same consumer or decision maker may make different choices depending on the characteristics of the decision context (e.g., the timing of the purchase, competing demands for funds), which have nothing to do with the characteristics of the alternatives themselves or their prices. Consumers or decision makers also face a variety of other behavioral phenomena including 81 Ward, D.O., Clark, C.D., Jensen, K.L., Yen, S.T., & Russell, C.S. (2011): ‘‘Factors influencing willingness-to pay for the ENERGY STAR® label,’’ Energy Policy, 39(3), 1450–1458. Available at www.sciencedirect.com/science/article/abs/pii/ S0301421510009171 (last accessed Feb. 15, 2022). 82 Ward, D.O., Clark, C.D., Jensen, K.L., Yen, S.T., & Russell, C.S. (2011): ‘‘Factors influencing willingness-to pay for the ENERGY STAR® label,’’ Energy Policy, 39(3), 1450–1458. Available at www.sciencedirect.com/science/article/abs/pii/ S0301421510009171) (last accessed Feb. 15, 2022). E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules loss aversion, sensitivity to information salience, and other forms of bounded rationality. Richard Thaler, who won the Nobel Prize in Economics in 2017 for his contributions to behavioral economics, and Cass Sunstein point out that these behavioral factors are strongest when the decisions are complex and infrequent, when feedback on the decision is muted and slow, and when there is a high degree of information asymmetry.83 These characteristics describe almost all purchasing situations of appliances and equipment, including RCWs. The installation of a new or replacement clothes washer is done very infrequently, as evidenced by the mean lifetime of 13.7 years. Additionally, it would take at least a few months for any impacts on operating costs to be fully apparent. Further, if the purchaser of the clothes washer is not the entity paying the energy costs (e.g., a tenant), there may be little to no feedback on the purchase. Additionally, there are systematic market failures that are likely to contribute further complexity to how products are chosen by consumers, as explained in the following paragraphs. The first of these market failures is the split-incentive or principal-agent problem. The principal-agent problem is a market failure that results when the consumer that purchases the equipment does not internalize all of the costs associated with operating the equipment. Instead, the user of the product, who has no control over the purchase decision, pays the operating costs. There is a high likelihood of splitincentive problems in the case of rental properties where the landlord makes the choice of what clothes washer to install, whereas the renter is responsible for paying energy bills. In addition to the split-incentive or principal-agent problem, there are other market failures that are likely to affect the choice of clothes washer efficiency made by consumers. Lucas Davis and Gilbert Metcalf 84 conducted an experiment demonstrating that the nature of the information available to consumers from EnergyGuide labels posted on air conditioning equipment results in an inefficient allocation of energy efficiency across households with different usage levels. Their findings 83 Thaler, R.H., and Sunstein, C.R. (2008). Nudge: Improving Decisions on Health, Wealth, and Happiness. New Haven, CT: Yale University Press. 84 Davis, L.W., and G.E. Metcalf (2016): ‘‘Does better information lead to better choices? Evidence from energy-efficiency labels,’’ Journal of the Association of Environmental and Resource Economists, 3(3), 589–625. (Available at: www.journals.uchicago.edu/doi/full/10.1086/ 686252) (Last accessed Feb. 15, 2022). VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 indicate that households are likely to make decisions regarding the efficiency of the climate control equipment of their homes that are not economically optimal relative to how they utilize the equipment (i.e., their decision is based on imperfect information and, therefore, is not necessarily optimal). In part because of the way information is presented, and in part because of the way consumers process information, there is also a market failure consisting of a systematic bias in the perception of equipment energy usage, which can affect consumer choices. These market failures affect a sizeable share of the consumer population. A study by Houde 85 indicates that there is a significant subset of consumers that appear to purchase appliances without taking into account their energy efficiency and operating costs at all. The existence of market failures in the residential sector is well supported by the economics literature and by a number of case studies. If DOE developed an efficiency distribution that assigned clothes washer efficiency in the no-new-standards case solely according to energy and water use or economic considerations such as lifecycle cost or payback period, the resulting distribution of efficiencies within the household sample would not reflect any of the market failures or behavioral factors above. DOE thus concludes such a distribution would not be representative of the clothes washer market. Further, even if a specific household is not subject to the market failures above, the purchasing decision of clothes washer efficiency can be highly complex and influenced by several factors not captured by the information available in the RECS samples. These factors can lead to household owners choosing a clothes washer efficiency that deviates from the efficiency predicted using only energy and water use or economic considerations (as calculated using the information from RECS 2015). However, DOE intends to investigate this issue further, and it welcomes suggestions as to how it might improve its assignment of clothes washer efficiency in its analyses. 9. Payback Period Analysis The payback period is the amount of time (expressed in years) it takes the consumer to recover the additional 85 Houde, S. (2018): ‘‘How Consumers Respond to Environmental Certification and the Value of Energy Information,’’ The RAND Journal of Economics, 49 (2), 453–477 Available at onlinelibrary.wiley.com/doi/full/10.1111/17562171.12231 (Last accessed Feb. 15, 2022). PO 00000 Frm 00051 Fmt 4701 Sfmt 4702 13569 installed cost of more-efficient products, compared to baseline products, through energy cost savings. 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. DOE refers to this as a ‘‘simple PBP’’ because it does not consider changes over time in operating cost savings. The PBP calculation uses the same inputs as the LCC analysis when deriving first-year operating costs. 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. 10. Other Issues Fraas cited a case study of DOE’s 2001 RCW standards.86 Fraas stated that this case study identified several issues that would result in lower cost saving estimates than projected in DOE’s ex ante analyses. These included: (1) reduced product reliability and life; (2) additional operation and maintenance costs; and (3) overstatement of clothes washer usage relative to DOE’s ex ante analysis. Fraas added that the case study illustrated the sensitivity of DOE’s life cycle analysis to different usage and product life assumptions and showed that DOE could have improved its analysis by developing distributions for key components of its analysis. Finally, Fraas urged DOE to conduct a retrospective analysis of its existing standards as part of the rulemaking process, including collection of extensive data on usage, reliability, and life, to provide a basis for assessing 86 The final rule establishing these standards was published on January 12, 2001. 66 FR 3313. E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 13570 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules prospective energy conservation standards. (Fraas, No. 35 at pp. 1–2) DOE has reviewed Fraas & Miller 2020 and identified several fundamental misunderstandings in the paper with respect to the 2001 RCW rulemaking and standard (with compliance dates of 2004 and 2007). Specifically, the paper takes as a premise that the standards finalized in 2001 forced consumers to adopt front-loading clothes washers. This is fundamentally incorrect. DOE established separate product classes and standards for front-loading and toploading clothes washers. While the 2001 standard set the same efficiency level for both of these classes, DOE noted in the final rule that there were both topand front-loading clothes washers in the market at all of the efficiency levels prescribed in the final rule and that all efficiency levels were technologically feasible for both top- and front-loading clothes washers. (January 12, 2021; 66 FR 3314, 3318.) Therefore, manufacturers were able to choose how to invest in meeting standards across top-loading and front-loading models. Top-loading clothes washers continue to be available for purchase today and consumers may choose them if they wish. While there have been changes to top-loading clothes washer market share over time, today they have a market share greater than 70%. With regard to reduced product reliability, the paper attempts to establish a causal link between regulation and litigation that they claim is evidence of reduced product reliability. However, all litigation evidence presented in the paper would apply to both baseline (pre-standards) and more efficient front-loading clothes washers, and there is no causal connection to regulation. The paper ignores past and parallel trends in litigation in the market for both the same products, and other, similar products. Additionally, there is no counter-factual argument. With regard to reduced product life, the paper questions the estimates used in DOE’s lifetime analyses, but compares lifetime estimates spanning 23 years. DOE’s lifetime estimates are always based on the best available data at the time, and were reviewed by stakeholders before publishing the final rule. In the follow-up rulemaking, culminating in the May 2012 Final Rule, DOE performed a statistical analysis of historical shipments data and RECS 2005, which resulted in a lifetime estimate consistent with DOE’s prior lifetime estimate. 10 CFR 430.32. This lifetime methodology is peer-reviewed. The argument with respect to additional operation and maintenance VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 costs also ignores product class differentiation. Baseline front-loading units would have the same considerations, and therefore the incremental repair rate and operation and maintenance costs of higher efficiency units are the relevant parameters for DOE’s analyses; these are typically negligible. With respect to the possible overstatement of clothes washer usage relative to DOE’s ex ante analysis, DOE again notes that its assumptions are based on the latest available data at the time of the rulemaking, particularly RECS. For the 2012 rulemaking, the average number of loads per year in the analysis decreased, in line with RECS 2005 results compared to RECS 1993.87 Consumer behavior can indeed evolve over time. Regarding the point that DOE could have improved its analysis by developing distributions for key components of its analysis, DOE notes that in the current rulemaking, lifetime, usage, energy consumption, and discount rates, among other things, are all characterized by distributions. With respect to the recommendation to conduct a retrospective analysis as part of this rulemaking, DOE acknowledges that parameters such as lifetime and product usage can change over time. In this rulemaking, DOE uses the best available data to develop new estimates of such parameters. To the extent that the estimates have changed over time, this is not evidence that DOE could have made a better assumption in the previous rulemakings, as it was relying on the best available data at that time, and the difference between estimates in two years would not be sufficient to make adjustments to estimates in future years. For all of the previous reasons, DOE is not making any methodology changes to its analyses, but it updated inputs based on data availability including repair and maintenance costs, energy and water usage, product lifetime, and product efficiency distribution. G. Shipments Analysis DOE uses projections of annual product shipments to calculate the national impacts of potential amended energy conservation standards on energy use, NPV, and future manufacturer cash flows.88 The 87 Department of Energy—Energy Information Administration, Residential Energy Consumption Survey, 1993 and 2005. Available at www.eia.gov/ consumption/residential/. 88 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 00052 Fmt 4701 Sfmt 4702 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. To project RCW shipments under the no-new-standards case, DOE utilized historical shipments data from AHAM. DOE estimated RCW shipments by projecting shipments into two market segments: (1) replacement of existing RCWs; (2) new housings. To project RCW replacement shipments, DOE developed retirement functions from RCW lifetime estimates and applied them to the existing products in the housing stock, which are tracked by vintage. To estimate shipments to new housings, DOE used projections of new housing starts coupled with RCWs’ saturation data. In other words, to project the shipments for new housings for any given year, DOE multiplied the housing projections by the estimated saturation of RCWs for new housing units. For new housing completions and mobile home placements, DOE used recorded data through 2020,89 and adopted the projections from AEO2022 for 2021– 2050. DOE used the data contained in the 2015 RECS to characterize ownership of RCWs in households across various housing types, including multi-family housing. DOE then aggregated the above two market segments for any given year during the analysis period (2027–2056) and divided total RCW shipments into its five product classes. For this NOPR, DOE estimated the market share between top-loading and front-loading clothes washers would remain at the current level based on the historical shipments data by washer loading type (2004–2021) provided by AHAM. (AHAM, No. 40, at p. 11) DOE estimated market share for top-loading and frontloading clothes washers would remain at 75 percent and 25 percent, respectively. DOE then disaggregated top-loading clothes washer market share into three product classes (i.e., semiautomatic, ultra-compact, and standardsize) and front-loading into two product classes (i.e., compact and standard-size). In addition, DOE assumed annual growth rate for semi-automatic and toploading ultra-compact clothes washers 89 U.S. Census. Characteristics of New Housing. Available at www.census.gov/construction/chars/. E:\FR\FM\03MRP2.SGM 03MRP2 13571 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules would be at 0.2 percent. Table IV.34 shows the estimated market share and shipments for each product class. TABLE IV.34—MARKET SHARE AND SHIPMENTS BY PRODUCT CLASS IN 2027 Market share (%) ddrumheller on DSK120RN23PROD with PROPOSALS2 Product class Shipments (million) Semi-Automatic ........................................................................................................................................................ Top-Loading, Ultra-Compact ................................................................................................................................... Top-Loading, Standard-Size .................................................................................................................................... Front-Loading, Compact .......................................................................................................................................... Front-Loading, Standard-Size .................................................................................................................................. 1.6 0.5 72.9 1.6 23.4 0.16 0.05 7.54 0.16 2.42 Total .................................................................................................................................................................. 100 10.35 DOE seeks comment on the approach and inputs used to develop no-new standards case shipments projection and market share for each product class. To project RCW shipments under a standards-case, DOE used a price elasticity parameter, which relates the incremental total installed cost to total RCW shipments, and an efficiency elasticity parameter, which relates the change in the operating cost to RCW shipments. Both types of elasticity relate changes in demand to changes in the corresponding characteristic (price or efficiency). A regression analysis estimated these terms separately from each other and found that the price elasticity of demand for several appliances is on average ¥0.45.90 Thus, for example, a price increase of 10 percent would result in a shipments decrease of 4.5 percent, all other factors held constant. The same regression analysis found that the efficiency elasticity is estimated to be on average 0.2 (i.e., a 10-percent efficiency improvement, equivalent to a 10-percent decrease in operating costs, would result in a shipments increase of 2 percent, all else being equal). DOE assumed when market impact occurs, i.e., when shipments drop under a standards-case, the affected consumers would repair their product rather than replace it. Under this method, DOE does not assume that consumers completely forgo the use of the product. The model instead assumes about the length of time that the life of the product is extended. This market impact is thus effectively applied to the repair or replacement decision. The second-hand market for used appliances is a potential alternative to consumers purchasing a new unit or repairing a broken unit. An increase in the purchases of older, lessefficient second-hand units due to a 90 Fujita, S., Estimating Price Elasticity using Market-Level Appliance Data. LBNL–188289 (August 2015). Available at: etapublications.lbl.gov/sites/default/files/lbnl188289.pdf. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 price increase resulting from a more stringent standard could potentially decrease projected energy savings. DOE assumed that purchases on the secondhand market would not change significantly due to the proposed standard level and did not include their impact on product shipments. DOE requests data on the market size and typical selling price of units sold through the second-hand market for residential clothes washers. ASAP et al. encouraged DOE to more thoroughly model market shifts under standards implementations. ASAP et al. commented that in the September 2021 Preliminary TSD, DOE’s logistic regression model that captured the relationship between the market share of front- and top-loading clothes washers, their prices, and their energy usage indicates that the front-loading market share is negatively correlated with top-loading price and energy usage. ASAP et al. therefore commented that the model predicts that the frontloading market share will decrease if higher standards are implemented for both top- and front-loading clothes washers. However, ASAP et al. noted that the estimated average price difference between front-loading and top-loading clothes washers is $323 at the baseline versus only $186 at EL 4. ASAP et al. stated that it is plausible that increasing standards could move the market towards, rather than away from, front-loading clothes washers. ASAP et al. therefore suggested that DOE should analyze how estimated first costs for each product class may affect market share projections. (ASAP et al., No. 37 at pp. 4–5) The consumer choice model developed under the September 2021 Preliminary Analysis lacked historical retail pricing, sales data, and clothes washer energy use data necessary for DOE to project market share between front-loading and top-loading RCWs, directly using their first cost and sales data as suggested by ASAP et al. DOE explored a method, but the regression PO 00000 Frm 00053 Fmt 4701 Sfmt 4702 statistic results indicate a low Rsquared, which means the predicted model would not fit with the historical market share data. Recent historical shipments data presented by AHAM (AHAM, No. 40, at p. 11) indicate that the proportion of front-loading clothes washers compared to total clothes washer shipments appears to have leveled off. Therefore, for this NOPR analysis, DOE used a frozen scenario for market shifting (e.g., no market shifting) under the standards case. For details on the shipments analysis, see chapter 9 of the NOPR TSD. H. National Impact Analysis The NIA assesses the national energy savings (NES), national water savings (NWS), 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. (‘‘Consumer’’ in this context refers to consumers of the product being regulated.) DOE calculates the NES, NWS, and NPV for the potential standard levels considered based on projections of annual product shipments, along with the annual energy and water consumption and total installed cost data from the energy and water use and LCC analyses. For the present analysis, DOE projected the energy and water savings, operating cost savings, product costs, and NPV of consumer benefits over the lifetime of RCWs sold from 2027 through 2056. DOE evaluates the impacts of amended standards by comparing a case without such standards with standardscase 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 E:\FR\FM\03MRP2.SGM 03MRP2 13572 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules 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 and water 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.35 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.35—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 shipments-weighted efficiency improvement of 0.4 percent for top-loading standard-size and 0.1 percent for both front-loading compact and standard-size clothes washers. Standards cases: ‘‘Roll up’’ equipment to meet potential efficiency level. Annual weighted-average values are a function of energy and water use at each TSL. Annual Energy and Water Consumption per Unit. Total Installed Cost per Unit ........... Annual Energy and Water Cost per Unit. Repair and Maintenance Cost per Unit. Energy and Water Price Trends ..... Energy Site-to-Primary and FFC Conversion. Discount Rate ................................. Present Year ................................... Annual weighted-average values are a function of cost at each TSL. Incorporates projection of future product prices based on historical data. Annual weighted-average values as a function of the annual energy and water consumption per unit and energy and water prices. Annual values change between non-ENERGY STAR and ENERGY STAR efficiency levels. AEO2022 projections (to 2050) and constant value based on average between 2046–2050 thereafter. Historical PPI extrapolated projection (to 2050) and constant value based on average between 2046–2050 thereafter. A time-series conversion factor based on AEO2022. 3 percent and 7 percent. 2022. ddrumheller on DSK120RN23PROD with PROPOSALS2 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 standard. To project the trend in efficiency absent amended standards for RCWs over the entire shipments projection period, DOE considered recent trends in DOE’s CCD data and the potential effect of programs such as ENERGY STAR. As discussed in section IV.F.8 of this document, DOE estimated an annual efficiency improvement of 0.4 and 0.1 percent for top-loading standard-size and front-loading (compact and standard-size) clothes washers, respectively. 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 VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 products above the standard would remain unchanged. 2. National Energy and Water Savings The national energy and water savings analysis involves a comparison of national energy and water consumption of the considered products between each potential standards case (or TSL) and the case with no amended energy conservation standards. DOE calculated the national energy and water consumption by multiplying the number of units (stock) of each product (by vintage or age) by the unit energy and water consumption (also by vintage). DOE calculated annual NES and NWS based on the difference in national energy and water 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 AEO2022. Cumulative energy and water savings are the sum of the NES and NWS 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 PO 00000 Frm 00054 Fmt 4701 Sfmt 4702 increase in utilization of the product due to the increase in efficiency. As described in section IV.E.2, DOE did not find any data on the rebound effect specific to RCWs and did not apply a rebound effect. 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 NAS, 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, multisector, partial equilibrium model of the U.S. energy sector 91 that EIA uses to 91 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/outlooks/aeo/nems/ E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules ddrumheller on DSK120RN23PROD with PROPOSALS2 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 and 13A 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 and water 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 RCW 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 RCW price is projected to drop 14.4 percent relative to 2021. 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 RCWs. In addition to the default price trend, DOE considered two product price sensitivity cases: (1) a high price decline case based on PPI data for the period 1980–2021 and (2) a low price decline case based on PPI data for the period 1948–1979. The derivation of these price trends and the results of these sensitivity cases are described in appendix 10C of the NOPR TSD. The energy and water cost savings are calculated using the estimated energy and water savings in each year and the projected price of the appropriate form of energy and water. To estimate energy prices in future years, DOE multiplied the average regional energy prices by the projection of annual national-average residential energy price changes in the documentation/archive/pdf/0581(2009).pdf. (last accessed June 12, 2022). VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 Reference case from AEO2022, which has an end year of 2050. To estimate price trends after 2050, the 2046–2050 average was used for all years. To estimate water prices in future years, DOE multiplied the average national water prices by the projection of annual national-average residential water price changes in the extrapolated future water price trend, which is based on the historical water price index from 1988 to 2021. To estimate price trends after 2050, DOE used a constant value derived from the average values from 2046 through 2050. As part of the NIA, DOE also analyzed scenarios that used inputs from variants of the AEO2022 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 10C 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.92 The discount rates 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 7percent 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 92 United States Office of Management and Budget. Circular A–4: Regulatory Analysis. September 17, 2003. Section E. Available at obamawhitehouse.archives.gov/omb/circulars_ a004_a-4/ (last accessed June 12, 2022). PO 00000 Frm 00055 Fmt 4701 Sfmt 4702 13573 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. The sections below discuss the individual subgroups, and additional details are found in chapter 11 of the NOPR TSD. 1. Low-Income Households Low-income households are significantly more likely to be renters or to live in subsidized housing units, compared to households that are not low-income. In these cases, the landlord purchases the equipment and may pay the energy bill as well. The CA IOUs recommended that DOE consider adjustments to its consumer subgroup analysis by creating a lowincome renter subgroup. The CA IOUs commented that it is more likely that the incremental clothes washer purchase costs to the average lowincome household would be paid by a landlord and passed along to the lowincome household across multiple months, such that the benefits of lower energy and water costs would offset the incremental cost increases of higher efficiency products. (CA IOUs, No. 43 at pp. 1–2) NYSERDA recommended that DOE conduct additional analysis on the implications to renters as part of its lowincome consumer subgroup assessment. NYSERDA noted that within lowincome households, there are important distinctions between renters and owners, and renters often bearing the operational costs of energy and water with limited input on the choice of products. (NYSERDA, No. 36 at p. 2) For this NOPR analysis, DOE divided low-income households into three subsubgroups: (1) renters who pay energy bill; (2) renters who do not pay energy bill; and (3) homeowners. The 2015 RECS includes data on whether a household pays for the energy bill, allowing DOE to categorize households in the analysis narrowly,93 excluding any costs or benefits that are accrued by either a landlord or subsidized housing agency. This allows DOE to determine whether low-income households are disproportionately affected by an amended energy conservation standard in a more accurate manner. Table IV.36 shows the distribution of low-income 93 The energy bill includes fuel type of electricity, natural gas, or propane consumed by a household. E:\FR\FM\03MRP2.SGM 03MRP2 13574 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules household clothes washer users with respect to whether they rent or own and whether they pay the energy bill. respect to whether they rent or own and whether they pay the energy bill. TABLE IV—36 CHARACTERIZATION OF LOW-INCOME HOUSEHOLDS IN THE SAMPLE FOR CLOTHES WASHERS Percentage of low-income sample Top-loading, standardsize (%) Type of household * Renters (Pay for Energy Bill) ** .......... Renters (Do Not Pay for Energy Bill) **. Owners ................................................ Impact of higher efficiency on energy bill Impact of first cost increase Front-loading, standardsize (%) Semi-automatic, top-loading, Ultra-compact (%) Front-loading, compact (%) 37 5 28 4 50 11 41 14 Full/Partial savings None ..................... None.*** None.*** 58 69 39 46 Full/Partial savings Full. ddrumheller on DSK120RN23PROD with PROPOSALS2 * RECS 2015 lists three categories: (1) Owned or being bought by someone in your household (here classified as ‘‘Owners’’ in this table); (2) Rented (here classified as ‘‘Renters’’ in this table); (3) Occupied without payment of rent (also classified as ‘‘Renters’’ in this table). Renters include occupants in subsidized housing including public housing, subsidized housing in private properties, and other households that do not pay rent. RECS 2015 does not distinguish homes in subsidized or public housing. ** RECS 2015 lists four categories for each of the fuels used by a household: (1) Household is responsible for paying for all used in this home; (2) All used in this home is included in the rent or condo fee; (3) Some is paid by the household, some is included in the rent or condo fee; and 4) Paid for some other way. ‘‘Do Not Pay for Energy Bill’’ includes only category (2). Partial energy bill savings would occur in cases of category (3). *** Low-income renters typically do not purchase a clothes washer. Therefore, it is unclear if the renters would be asked to pay the full or partial of the total installed cost. As a result, DOE estimated there would be no impact of first cost increase for low-income renters and occupants in public housing and other households that do not pay rent. AHAM commented that increased efficiency standards would eliminate the lowest priced top-loading RCWs, which would have a disproportionate, negative impact on low-income households. AHAM added that, while low-income consumers would receive payback over time due to savings on utility bills, these consumers are unlikely to have the extra funds to pay for a more efficient, but more expensive RCW. (AHAM, No. 40 at pp. 12–13) Whirlpool expressed concern about the impacts of amended standards on low-income consumers and believe that amended standards for clothes washers could have potentially devastating impacts on racial and economic equity. Whirlpool commented that any increase to purchase cost driven by amended standards may be difficult or impossible for many low-income households to accept and may further widen the equity gap rather than help close it. (Whirlpool, No. 39 at pp. 16–17) As described in section V.B.1 of this document, the percent of low-income RCW consumers experiencing a net cost at the proposed standard level (TSL 4) is smaller (13 percent for top-loading standard-size washers) than in the full LCC sample (25 percent for top-loading standard-size washers). The main reason is that a high portion of low-income household renters would not have to pay the total cost of a higher-efficiency washer because renters do not select nor pay for the clothes washer itself (CA IOUs, No.43 at pp. 1–2). VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 2. Senior-Only Households Annual clothes washer usage for senior-only households is significantly less than the full household sample because the household size for senioronly families is typically either one or two people. A household size equal to or larger than three members accounts for only 8 percent of senior-only households. Therefore, as described in section V.B.1 of this document, the percentage of senior-only RCW consumers experiencing a net cost at the TSL 4 is greater (35 percent for toploading standard-size washers) than in the full LCC sample (25 percent for toploading standard-size washers). The simple payback period for senior-only households at TSL 4 is 2 years longer than in the full LCC sample. For households who would be negatively impacted by amended energy conservation standards, a potential rebate program to reduce the total installed costs would be effective in lowering the percentage of consumers with a net cost and reducing simple payback period. DOE is aware of 80 rebate programs currently available for residential clothes washers meeting ENERGY STAR requirements initiated by 63 organizations in various States as described in chapter 17 of the NOPR TSD.94 DOE is seeking comment about 94 As of June, 2022, 80 rebate programs were available for residential clothes washers meeting ENERGY STAR requirements: www.energystar.gov/ rebate-finder?scrollTo=363.6363525390625&sort_ by=utility&sort_direction=asc&page_ number=0&lastpage=0&zip_code_filter=&search_ text=&product_clean_filter= Clothes+Washers&product_clean_ PO 00000 Frm 00056 Fmt 4701 Sfmt 4702 how amended energy conservation standards may impact the low-income and senior-only consumer economics being presented and considered in this proposed rulemaking. DOE is seeking comment about definable subpopulations in addition to low-income and senior-only households and the associated data required to differentiate how such subpopulation use clothes washers. Chapter 11 in the NOPR TSD describes the consumer subgroup analysis. J. Manufacturer Impact Analysis 1. Overview DOE performed an MIA to estimate the financial impacts of amended energy conservation standards on manufacturers of RCWs and to estimate the potential impacts of such standards on direct 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 employment, capacity, and competition, as well as how standards contribute to overall regulatory burden. Finally, the MIA serves to identify any disproportionate isopen=0&product_ types=Select+a+Product+Category. E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules 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 standards cases (i.e., TSLs). To capture the uncertainty relating to manufacturer pricing strategies following amended standards, the GRIM estimates a range of possible impacts under different 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 RCW manufacturing industry based on the market and technology assessment and publicly-available information. This included a top-down analysis of RCW manufacturers that DOE used to derive preliminary financial inputs for the GRIM (e.g., revenues; materials, labor, overhead, and depreciation expenses; selling, general, and administrative expenses (‘‘SG&A’’); and R&D expenses). DOE also used public sources of information to further calibrate its initial characterization of the RCW manufacturing industry, including company filings of Form 10-Ks from the SEC,95 corporate annual reports, the U.S. Census Bureau’s Annual Survey of 95 U.S. Securities and Exchange Commission, Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system. Available at: www.sec.gov/edgar/ search/ (Last accessed July 1, 2022). VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 Manufactures (‘‘ASM’’),96 and reports from Dun & Bradstreet.97 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 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 RCWs 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 (‘‘LVMs’’), niche players, and/or manufacturers exhibiting a cost structure that largely differs from the industry average. DOE 96 U.S. Census Bureau, Annual Survey of Manufactures. ‘‘Summary Statistics for Industry Groups and Industries in the U.S (2020).’’ Available at: www.census.gov/data/tables/time-series/econ/ asm/2018-2020-asm.html (Last accessed July 15, 2022). 97 The Dun & Bradstreet Hoovers login is available at: app.dnbhoovers.com (Last accessed July 15, 2022). PO 00000 Frm 00057 Fmt 4701 Sfmt 4702 13575 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 RCWs, DOE used a real discount rate of 9.3 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 and 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 products is typically more expensive than manufacturing baseline products 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. E:\FR\FM\03MRP2.SGM 03MRP2 13576 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules DOE conducted this analysis using the physical teardown approach. The resulting bill of materials provides the basis for the MPC estimates. In this proposed rulemaking, DOE relies on an efficiency-level approach, supplemented with the design-option approach for certain ‘‘gap fill’’ efficiency levels. The efficiency-level approach is appropriate for RCWs, given the availability of certification data to determine the market distribution of existing products and to identify efficiency level ‘‘clusters’’ that already exist on the market. For a complete description of the MPCs, see chapter 5 of the NOPR TSD or section IV.C of this document. ddrumheller on DSK120RN23PROD with PROPOSALS2 b. Shipments Projections The GRIM estimates manufacturer revenues based on total unit shipment projections and the distribution of those shipments by efficiency level. Changes in sales volumes and efficiency mix over time can significantly affect manufacturer finances. For this analysis, the GRIM uses the NIA’s annual shipment 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 noncapitalized costs necessary to make product designs comply with amended energy conservation standards. DOE relied on information derived from manufacturer interviews, the engineering analysis, and product teardowns to evaluate the level of capital and product conversion costs manufacturers would likely incur at the various TSLs. During interviews, DOE asked manufacturers to estimate the capital conversion costs (e.g., changes in VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 production processes, equipment, and tooling) to meet the various efficiency levels. DOE also asked manufacturers to estimate the redesign effort, engineering resources, and marketing expenses 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 also estimated industry costs associated with re-rating basic models in accordance with Appendix J, as detailed in the June 2022 TP Final Rule. 87 FR 33316. Manufacturer data was aggregated to better reflect the industry as a whole and to protect confidential information. DOE then scaled up the aggregate capital and product conversion cost feedback from interviews to estimate total industry conversion costs. DOE acknowledges that manufacturers may follow different design paths to reach the various efficiency levels analyzed. An individual manufacturer’s investments depend on a range of factors, including the company’s current product offerings and product platforms, existing production facilities and infrastructure, and make vs. buy decisions for components. DOE’s conversion cost methodology incorporated feedback from all manufacturers that took part in interviews and extrapolated industry values. While industry average values may not represent any single manufacturer, DOE’s modeling provides reasonable estimates of industry-level investments. 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) PO 00000 Frm 00058 Fmt 4701 Sfmt 4702 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 the manufacturer markups in the standards case yields different sets of impacts on manufacturers. For the MIA, DOE modeled two standards-case 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 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 18 percent for all product classes.98 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 of 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 expected 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 takes effect. 98 The gross margin percentage of 18 percent is based on a manufacturer markup of 1.22. E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules A comparison of industry financial impacts under the two scenarios is presented in section V.B.2.a of this document. ddrumheller on DSK120RN23PROD with PROPOSALS2 3. Manufacturer Interviews DOE interviewed manufacturers representing approximately 82 percent of domestic RCW industry shipments. Participants included domestic-based and foreign-based original equipment manufacturers (‘‘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 RCWs. 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 DOE’s responses throughout the rest of this document. a. Product Classes In interviews, manufacturers had differing views on the appropriate RCW product class structure. Generally, manufacturers specializing in standardsize front-loading clothes washers recommended that DOE combine product classes and remove the product class delineation based on load configuration. These manufacturers emphasized that front-loading clothes washers are more efficient than toploading counterparts. These manufacturers noted that even energyconscious consumers often just look for the ENERGY STAR certification and are unaware of the energy usage differences between top-loading and front-loading models. Several manufacturers recommended an array of updates to the product class structure as it relates to the classification of standard-size versus compact-size products. Some manufacturers suggested differentiating product classes based on cabinet width instead of tub capacity. These manufacturers noted that consumers often purchase compact front-loading RCWs due to size constraints at the installation location. Other manufacturers encouraged DOE to align the capacity cutoff for top-loading compact clothes washers with the capacity cutoff for front-loading compact clothes washers analyzed in the September 2021 Preliminary Analysis (i.e., 3.0 ft3). 86 FR 53886. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 Some manufacturers suggested splitting up the standard-size product classes by varying cabinet-size (or capacity) thresholds. One manufacturer noted that entry-level products are typically on the smaller side, with capacities under 4.0 ft3. These smaller standard-size products are often less expensive than larger capacity RCW models. Additionally, the technology options may vary based on capacity. For example, this manufacturer asserted that larger capacity models can better handle increased spin speeds and have an inherent advantage for efficiency ratings due to the larger weighted-average loadsize compared to smaller capacity models. b. Ability To Serve Certain Consumer Segments In interviews, manufacturers emphasized that consumer preferences vary and as a result, there are a range of RCW models available that appeal to different consumer segments. Currently, manufacturers balance achieving energy and water efficiency metrics with other considerations, such as cycle time, noise levels, fabric care, cleaning performance, and upfront cost. Multiple manufacturers expressed concerns about their ability to meet some consumer requirements under amended standards. For instance, several manufacturers stated that they would need to increase cycle times at certain efficiencies to recover cleaning performance at reduced water levels. These manufacturers noted that consumers often expect wash cycle times to align with dryer cycle times. Other manufacturers expressed concerns about diminished fabric care and heightened noise under levels that require notably faster spin speeds. Some manufacturers stated that it would require significant engineering time and capital investment to develop a range of platforms that meet more stringent energy standards as well as a range of consumer performance requirements. A few manufacturers recommended DOE explore instituting a cleaning performance metric, like the concept proposed for dishwashers in a NOPR published on December 22, 2021. 86 FR 72738. Some manufacturers stated that a large segment of ‘‘traditionalist’’ consumers prefer ‘‘traditional’’ toploading RCWs with specific characteristics and the manufacturers asserted that more stringent standards would threaten the viability of these ‘‘traditional’’ top-loading clothes washers that met requirements of this consumer segment. These manufacturers described ‘‘traditionalist’’ PO 00000 Frm 00059 Fmt 4701 Sfmt 4702 13577 consumers as preferring top-loading clothes washers with agitators, visible water levels, and flexible (i.e., manual) fill options. Specifically, manufacturers stated that an agitator design would not be feasible at or above the current ENERGY STAR level (EL 2). Some manufacturers asserted, based on their product research and reported shifts in consumer demand for agitator washers, that some ‘‘traditionalist’’ consumers would be dissatisfied with top-loading designs that lacked the agitator and instead used a wash plate. One manufacturer noted that they recently introduced RCWs with agitators due to consumer preferences for such features. Several manufacturers also noted that amending standards would raise the cost of baseline RCWs, which would disproportionately impact low-income consumers since they typically purchase entry-level, ‘‘traditional’’ top-loading clothes washers. These manufacturers raised concerns about their future ability to offer low-cost RCWs and serve the low-income consumer market under amended standards. c. Supply Chain Constraints In interviews, some manufacturers expressed concerns about potential supply chain constraints. Those manufacturers noted concerns about the ongoing supply constraints for microprocessors and electronics. Any shift towards direct drive motors would require that industry source more advanced microprocessors, which are already difficult to secure. Some manufacturers were also uncertain about industry’s ability to source enough direct drive motors— particularly for standard-size toploading clothes washers—to meet market demand at and above the current ENERGY STAR level (EL 2). Manufacturers asserted that if these supply constraints continue through the end of the conversion period, industry could face production capacity constraints. 4. Discussion of MIA Comments In response to the September 2021 Preliminary Analysis, AHAM urged DOE to consider alternative approaches to cumulative regulatory burden. AHAM encouraged 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, No. 40 at p. 7) AHAM noted other regulations impact RCW manufacturers such as consumer clothes dryers, commercial clothes washers, E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 13578 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules consumer refrigerator/freezers, miscellaneous refrigeration products, cooking products, dishwashers, room air conditioners, dehumidifiers, and portable air conditioners rulemakings. (AHAM, No. 40 at p. 8) Additionally, AHAM requested that DOE include the cost of monitoring test procedure and energy conservation standard rulemakings in its rulemaking analyses. (Id.) 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 make it more difficult to discern the direct impact of the amended standard on covered 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. To consider to costs of monitoring test procedure and energy conservation standard rulemakings, 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. AHAM requested DOE plan its rulemaking process such that the compliance dates for residential clothes washers and clothes dryers are identical or very nearly identical. AHAM further explained that this would allow manufacturers to design these products simultaneously to meet amended standards and so that there is less confusion for manufacturers, retailers, and consumers as products would need to be re-floored leading up to and on the compliance date of any amended energy conservation standards. (AHAM, No. 40 at pp. 7–8) Whirlpool also stated that if DOE decides to amend standards for both clothes washers and clothes dryers, then compliance dates should be aligned to allow for manufacturers to invest in clothes washers and clothes dryers as a pair, which prevents unnecessary cost, confusion, and burden for manufacturers and retailers. (Whirlpool, No. 39 at p. 20) Whirlpool added that it believes DOE has the statutory authority to align these compliance dates. (Id.) VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 Pursuant to a consent decree entered on September 20, 2022, DOE has agreed to sign and post on DOE’s publicly accessible website a rulemaking document for RCWs and consumer clothes dryers by February 29, 2024, that, when effective, would be DOE’s final agency action for standards for these products.99 As such, DOE expects that, if these two rulemakings result in amended energy conservations standards, the compliance dates would be similar. Whirlpool stated that more stringent standards would disproportionately harm the company due to its broad lineup of RCWs that includes broad offerings at entry-level price points. Whirlpool noted that the company would need to devote a high level of engineering resources to incorporate design options such as stainless-steel wash baskets, wash plates, direct drive motors, and product structural changes. Whirlpool added that moving from traditional agitators to high-efficiency agitators or wash plates would lead to increased costs associated with redesigning models and retooling factories. In contrast, Whirlpool emphasized that many competitors would not need to make additional investments to meet amended standards since they cater to a more targeted consumer segment. (Whirlpool, No. 39 at p. 18) DOE uses the GRIM, as described in section IV.J.2, to determine the quantitative impacts on the RCW industry as a whole. Impacts on individual manufacturers may vary from industry averages due to a wide range of company-specific factors including, but not limited to, differences in efficiency of current product offerings, production volumes, and legacy investments in manufacturing plants. DOE recognizes that the industry impacts do not apply evenly across manufacturers. However, as many of the GRIM inputs (e.g., industry financials) account for U.S. market share weights, the GRIM is most reflective of large manufacturers, like Whirlpool. Additionally, DOE’s modeling incorporates estimate conversion costs associated with the product changes, such as stainless-steel wash baskets, wash plates, direct drive motors, and product structural enhancements, identified by Whirlpool. Whirlpool expressed concern that direct drive and BPM motors are more expensive than PSC motors. (Whirlpool, No. 39 at p. 6) DOE incorporates the 99 Natural Resources Defense Council, Inc., et al. v Granholm, et al., No. 1:20–cv–09127 (S.D.N.Y.), and State of New York, et al. v Granholm, et al. No. 1:20–cv–09362 (S.D.NY). PO 00000 Frm 00060 Fmt 4701 Sfmt 4702 higher cost of direct drive and BPM motors in its engineering analysis, as discussed in section IV.C.4 of this document. Whirlpool noted concerns about being able to secure an adequate domestic supply of direct drive motors, if DOE amends standard, since direct drive motors typically come from foreign suppliers. (Whirlpool, No. 39 at p. 6) Samsung commented that direct drive motors have matured over the years and have become highly cost competitive. (Samsung, No. 41 at pp. 2–3) More stringent standards would likely necessitate adoption of more efficient technologies, such as direct drive motors. DOE notes that amended standards, if adopted, could provide regulatory certainty for manufacturers and suppliers to establish additional capacity in the supply chain. DOE seeks comment on the availability of direct drive motors in quantities required by industry if DOE were to adopt amended standards. 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 AEO2022. Power sector emissions of CH4 and N2O from fuel combustion are estimated using Emission Factors for Greenhouse Gas Inventories published by the EPA.100 The on-site operation of RCWs requires combustion of fossil fuels and results in emissions of CO2, NOX, SO2 100 Available at www.epa.gov/sites/production/ files/2021-04/documents/emission-factors_ apr2021.pdf (last accessed June 12, 2022). E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules 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.101 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 MWh or 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 ddrumheller on DSK120RN23PROD with PROPOSALS2 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. AEO2022 generally represents current legislation and environmental regulations, including recent government actions, that were in place at the time of preparation of AEO2022, including the emissions control programs discussed in the following paragraphs.102 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 (D.C.). (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, 2015.103 101 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 June 12, 2022). 102 For further information, see the Assumptions to AEO2022 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 June 12, 2022). 103 CSAPR requires states to address annual emissions of SO2 and NOX, precursors to the formation of fine particulate matter (PM2.5) VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 AEO2022 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 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 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 AEO2022. 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 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). PO 00000 Frm 00061 Fmt 4701 Sfmt 4702 13579 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 AEO2022 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 AEO2022, 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 considered in 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 E:\FR\FM\03MRP2.SGM 03MRP2 13580 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules ddrumheller on DSK120RN23PROD with PROPOSALS2 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 benefits where appropriate and permissible under law. DOE requests comment on how to address the climate benefits and other non-monetized effects 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 social cost (‘‘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 proposed rulemaking 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 (‘‘February 2021 SC– GHG TSD’’). 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 VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 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, 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, which included 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 (i.e., 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’’) 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 social cost of methane (i.e., SC–CH4) and nitrous oxide (i.e., 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 PO 00000 Frm 00062 Fmt 4701 Sfmt 4702 al.104 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).105 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. 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 104 Marten, A.L., E.A. Kopits, C.W. Griffiths, S.C. Newbold, and A. Wolverton. Incremental CH4 and N2O mitigation benefits consistent with the U.S. Government’s SC–CO2 estimates. Climate Policy. 2015. 15(2): pp. 272–298. 105 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. E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules 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 omitted effects 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 VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 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 SC–GHG 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,106 and recommended that 106 Interagency Working Group on Social Cost of Carbon. Social Cost of Carbon for Regulatory Impact Analysis under Executive Order 12866. 2010. United States Government. (Last accessed April 15, 2022.) www.epa.gov/sites/default/files/2016-12/ documents/scc_tsd_2010.pdf; 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. (Last accessed April 15, 2022.) www.federalregister.gov/ documents/2013/11/26/2013-28242/technicalsupport-document-technical-update-of-the-socialcost-of-carbon-for-regulatory-impact; 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. (Last accessed January 18, 2022.) www.epa.gov/sites/default/files/ 2016-12/documents/sc_co2_tsd_august_2016.pdf; 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. (Last accessed January 18, 2022.) PO 00000 Frm 00063 Fmt 4701 Sfmt 4702 13581 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- 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 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 SC–GHG 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 www.epa.gov/sites/default/files/2016-12/ documents/addendum_to_sc-ghg_tsd_august_ 2016.pdf. E:\FR\FM\03MRP2.SGM 03MRP2 13582 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules 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 the above 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 use 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 were 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 benefitcost 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 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.107 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 SC–GHG TSD, the IWG has recommended that, taken together, 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–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 for IWG’s February 2021 SC– GHG TSD. Table IV.37 shows the updated sets of SC–CO2 estimates from the IWG’s February 2021 SC–GHG TSD in 5-year increments from 2020 to 2050. The full set of annual values that DOE 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 include all four sets of SC–CO2 values, as recommended by the IWG.108 TABLE IV.37—ANNUAL SC–CO2 VALUES FROM 2021 INTERAGENCY UPDATE, 2020–2050 (2020$ PER METRIC TON CO2) Discount rate and statistic ddrumheller on DSK120RN23PROD with PROPOSALS2 Year 2020 2025 2030 2035 2040 2045 2050 5% 3% 2.5% 3% Average Average Average 95th percentile ................................................................................................................. ................................................................................................................. ................................................................................................................. ................................................................................................................. ................................................................................................................. ................................................................................................................. ................................................................................................................. 107 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. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 14 17 19 22 25 28 32 Available at www.whitehouse.gov/briefing-room/ blog/2021/02/26/a-return-to-science-evidencebased-estimates-of-the-benefits-of-reducing-climatepollution/. PO 00000 Frm 00064 Fmt 4701 Sfmt 4702 51 56 62 67 73 79 85 76 83 89 96 103 110 116 152 169 187 206 225 242 260 108 For example, the February 2021 SC–GHG 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. E:\FR\FM\03MRP2.SGM 03MRP2 13583 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules For 2051 to 2070, DOE used SC–CO2 estimates published by EPA, adjusted to 2020$.109 These estimates are based on methods, assumptions, and parameters identical to the 2020–2050 estimates published by the IWG. DOE expects additional climate benefits to accrue for any longer-life RCWs after 2070, but a lack of available SC–CO2 estimates for emissions years beyond 2070 prevents DOE from monetizing these potential benefits in this analysis. DOE multiplied the CO2 emissions reduction estimated for each year by the SC–CO2 value for that year in each of the four cases. DOE adjusted the values to 2021$ using the implicit price deflator for gross domestic product (‘‘GDP’’) from the Bureau of Economic Analysis. 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. AHAM cautioned against DOE using 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. AHAM stated that 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 TSLs DOE selects as a new or amended standard. (AHAM, No. 40 at p. 32) As stated in section III.F.1.f of this document, DOE maintains that environmental and public health benefits associated with the more efficient use of energy, including those connected to global climate change, are important to take into account when considering the need for national energy conservation, which is one of the factors that EPCA requires DOE to evaluate in determining whether a potential energy conservation standard is economically justified. In addition, Executive Order 13563, which was re-affirmed on January 21, 2021, stated that each agency must, among other things: ‘‘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).’’ For these reasons, DOE includes monetized emissions reductions in its evaluation of potential standard levels. As previously stated, however, DOE would reach the same conclusion presented in this proposed rulemaking in the absence of the social cost of greenhouse gases. b. Social Cost of Methane and Nitrous Oxide The SC–CH4 and SC–N2O values used for this NOPR were based on the values developed for the February 2021 SC– GHG TSD. Table IV.38 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 derived values after 2050 using the approach described above for the SC–CO2. TABLE IV.38—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% Average ddrumheller on DSK120RN23PROD with PROPOSALS2 2020 2025 2030 2035 2040 2045 2050 .................................. .................................. .................................. .................................. .................................. .................................. .................................. Average 670 800 940 1100 1300 1500 1700 2.5% 3% Average 95th percentile 1500 1700 2000 2200 2500 2800 3100 2000 2200 2500 2800 3100 3500 3800 3% 5% 3% 2.5% Average 3900 4500 5200 6000 6700 7500 8200 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 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. DOE adjusted the values to 2021$ using the implicit price deflator for GDP from the Bureau of Economic Analysis. 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. 2. Monetization of Other Emissions Impacts For the NOPR, 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.110 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, 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 RCWs using a method described in appendix 14B of the NOPR TSD. DOE also estimated the monetized value of NOX and SO2 emissions reductions from site use of natural gas in RCWs 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 109 See EPA, Revised 2023 and Later Model Year Light-Duty Vehicle GHG Emissions Standards: Regulatory Impact Analysis, Washington, DC, December 2021. Available at: www.epa.gov/system/ files/documents/2021-12/420r21028.pdf (last accessed January 13, 2022). 110 Estimating the Benefit per Ton of Reducing PM2.5 Precursors from 21 Sectors. www.epa.gov/ benmap/estimating-benefit-ton-reducing-pm25precursors-21-sectors. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 PO 00000 Frm 00065 Fmt 4701 Sfmt 4702 E:\FR\FM\03MRP2.SGM 03MRP2 13584 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules commercial buildings, the sector called ‘‘area sources’’ would be a reasonable proxy for residential and commercial buildings.111 The EPA document provides high and low estimates for 2025 and 2030 at 3- and 7-percent discount rates.112 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 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 the changes in installed electrical capacity and generation projected to result for each considered TSL. The analysis is based on published output from the NEMS associated with AEO2022. NEMS produces the AEO Reference case, as well as a number of side cases that estimate the economywide 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 AEO2022 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. ddrumheller on DSK120RN23PROD with PROPOSALS2 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 111 ‘‘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. 112 ‘‘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 21:12 Mar 02, 2023 Jkt 259001 any changes in the number of employees of manufacturers of the products subject to standards, their suppliers, and related service firms. 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. One method for assessing the possible effects on the demand for labor of such shifts in economic activity is to compare sector employment statistics developed by the Labor Department’s Bureau of Labor Statistics (‘‘BLS’’). BLS regularly publishes its estimates of the number of jobs per million dollars of economic activity in different sectors of the economy, as well as the jobs created elsewhere in the economy by this same economic activity. Data from BLS indicate that expenditures in the utility sector generally create fewer jobs (both directly and indirectly) than expenditures in other sectors of the economy.113 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. DOE estimated indirect national employment impacts for the standard levels considered in this NOPR using an 113 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 apps.bea.gov/ scb/pdf/regional/perinc/meth/rims2.pdf (Last accessed June 22, 2022). PO 00000 Frm 00066 Fmt 4701 Sfmt 4702 input/output model of the U.S. economy called Impact of Sector Energy Technologies version 4 (‘‘ImSET’’).114 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 (2027–2031), 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 RCWs. It addresses the TSLs examined by DOE, the projected impacts of each of these levels if adopted as energy conservation standards for RCWs, 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 by grouping individual efficiency levels for each class into TSLs. Use of TSLs allows DOE to identify and consider manufacturer cost interactions between the product 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 the analysis conducted for this NOPR, DOE analyzed the benefits and burdens of five TSLs for RCWs. DOE developed TSLs that combine efficiency 114 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. E:\FR\FM\03MRP2.SGM 03MRP2 13585 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules levels for each analyzed product class. 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 through Table V.3 present the TSLs and the corresponding efficiency levels that DOE has identified for potential amended energy conservation standards for RCWs. TSL 5 represents the max-tech energy and water efficiency for all product classes. TSL 4 represents the ENERGY STAR Most Efficient level for the front-loading product classes, the CEE Tier 1 level for the top-loading standard-size product class, and a gap fill level for the semiautomatic product class. TSL 3 represents the current ENERGY STAR efficiency level for all product classes that are eligible for the program, and a gap fill level for the semi-automatic product class. TSL 2 represents the nonmax-tech efficiency levels providing the highest LCC savings. TSL 1 represents EL 1 across all product classes. TABLE V.1—TRIAL STANDARD LEVELS FOR SEMI-AUTOMATIC, RESIDENTIAL CLOTHES WASHERS Semi-automatic TSL Efficiency level EER (lb/kWh/cycle) 1 2 2.12 2.51 1–4 ............................................................................................................................................... 5 ................................................................................................................................................... WER (lb/gal/cycle) 0.27 0.36 TABLE V.2—TRIAL STANDARD LEVELS FOR TOP-LOADING RESIDENTIAL CLOTHES WASHERS Top-loading, ultra-compact TSL EER (lb/kWh/cycle) Efficiency level 1 2 3 4 5 .................. .................. .................. .................. .................. Baseline Baseline Baseline Baseline Baseline Top-loading, standard-size ...................................................... ...................................................... ...................................................... ...................................................... ...................................................... WER (lb/gal/cycle) 3.79 3.79 3.79 3.79 3.79 Efficiency level EER (lb/kWh/cycle) 1 1 2 3 4 3.89 3.89 4.27 4.78 5.37 0.29 0.29 0.29 0.29 0.29 WER (lb/gal/cycle) 0.47 0.47 0.57 0.63 0.67 TABLE V.3—TRIAL STANDARD LEVELS FOR FRONT-LOADING RESIDENTIAL CLOTHES WASHERS Front-loading, compact TSL 1 2 3 4 5 Efficiency level EER (lb/kWh/cycle) 1 1 1 2 4 4.80 4.80 4.80 5.02 5.97 ............................................................... ............................................................... ............................................................... ............................................................... ............................................................... While not all efficiency levels were included in the TSLs, DOE considered all efficiency levels as part of its analysis.115 B. Economic Justification and Energy Savings ddrumheller on DSK120RN23PROD with PROPOSALS2 1. Economic Impacts on Individual Consumers DOE analyzed the economic impacts on RCW consumers 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. 115 Efficiency levels that were analyzed for this NOPR are discussed in section IV.C.1 of this VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 Front-loading, standard-size WER (lb/gal/cycle) Efficiency level EER (lb/kWh/cycle) 1 2 2 3 4 5.31 5.52 5.52 5.73 5.97 0.62 0.62 0.62 0.71 0.80 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 and a discount rate. Chapter 8 of the NOPR TSD provides detailed information on the LCC and PBP analyses. Table V.4 through Table V.13 show the LCC and PBP results for the TSLs considered for each product class. In the first of each pair of tables, the simple Frm 00067 Fmt 4701 Sfmt 4702 0.69 0.77 0.77 0.77 0.85 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. document. Results by efficiency level are presented in chapters 8, 10, and 12 of the NOPR TSD. PO 00000 WER (lb/gal/cycle) E:\FR\FM\03MRP2.SGM 03MRP2 13586 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules TABLE V.4—AVERAGE LCC AND PBP RESULTS FOR SEMI-AUTOMATIC RESIDENTIAL CLOTHES WASHERS Average costs (2021$) TSL Efficiency level Installed cost 1–4 .............. 5 .................. Baseline .......................... 1 ..................................... 2 ..................................... First year’s operating cost $553 561 568 Lifetime operating cost $136 107 93 Simple payback (years) LCC $1,532 1,195 1,044 $2,085 1,756 1,612 Average lifetime (years) ........................ 0.3 0.4 13.7 13.7 13.7 Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative to the baseline product. TABLE V.5—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR SEMI-AUTOMATIC RESIDENTIAL CLOTHES WASHERS Life-cycle cost savings TSL Efficiency level 1–4 ............................................................................................................................. 5 ................................................................................................................................. Average LCC savings * (2021$) 1 2 Percent of consumers that experience net cost 329 219 0 0 * The savings represent the average LCC for affected consumers. TABLE V.6—AVERAGE LCC AND PBP RESULTS FOR TOP-LOADING, ULTRA-COMPACT RESIDENTIAL CLOTHES WASHERS Average costs (2021$) TSL 1–5 .............. Efficiency level Baseline .......................... Installed cost First year’s operating cost Lifetime operating cost $904 $85 $958 LCC Simple payback (years) Average lifetime (years) $1,862 ........................ 13.7 Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. TABLE V.7—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR TOP-LOADING, ULTRA-COMPACT RESIDENTIAL CLOTHES WASHERS Life-cycle cost savings TSL Efficiency level Average LCC savings * (2021$) Percent of consumers that experience net cost 1–5 ................. Baseline ........................................................................................................................... $0.00 0% * The savings represent the average LCC for affected consumers. TABLE V.8—AVERAGE LCC AND PBP RESULTS FOR TOP-LOADING, STANDARD-SIZE RESIDENTIAL CLOTHES WASHERS Average costs (2021$) TSL Efficiency level ddrumheller on DSK120RN23PROD with PROPOSALS2 Installed cost 1, 2 .............. 3 .................. 4 .................. 5 .................. Baseline .......................... 1 ..................................... 2 ..................................... 3 ..................................... 4 ..................................... $706 795 881 891 896 First year’s operating cost Lifetime operating cost $183 164 157 152 149 $2,080 1,853 1,779 1,717 1,682 Simple payback (years) LCC $2,786 2,649 2,660 2,608 2,578 ........................ 4.6 6.8 5.9 5.5 Average lifetime (years) 13.7 13.7 13.7 13.7 13.7 Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative to the baseline product. VerDate Sep<11>2014 21:56 Mar 02, 2023 Jkt 259001 PO 00000 Frm 00068 Fmt 4701 Sfmt 4702 E:\FR\FM\03MRP2.SGM 03MRP2 13587 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules TABLE V.9—AVERAGE LCC AND PBP RESULTS FOR TOP-LOADING, STANDARD-SIZE RESIDENTIAL CLOTHES WASHERS Life-cycle cost savings TSL Efficiency level 1, 2 ............................................................................................................................. 3 ................................................................................................................................. 4 ................................................................................................................................. 5 ................................................................................................................................. Percent of consumers that experience net cost Average LCC savings * (2021$) 1 2 3 4 $138 115 134 157 14 28 25 23 * The savings represent the average LCC for affected consumers. TABLE V.10—AVERAGE LCC AND PBP RESULTS FOR FRONT-LOADING, COMPACT RESIDENTIAL CLOTHES WASHERS Average costs (2021$) TSL Efficiency level Installed cost 1–3 .............. 4 .................. 5 .................. Baseline .......................... 1 ..................................... 2 ..................................... 4 ..................................... First year’s operating cost $809 861 909 944 Lifetime operating cost $100 93 89 81 Simple payback (years) LCC $1,119 1,046 992 901 $1,929 1,907 1,901 1,845 Average lifetime (years) ........................ 0.0 9.1 7.1 13.7 13.7 13.7 13.7 Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative to the baseline product. TABLE V.11—AVERAGE LCC AND PBP RESULTS FOR FRONT-LOADING, COMPACT RESIDENTIAL CLOTHES WASHERS Life-cycle cost savings TSL Efficiency level 1–3 ............................................................................................................................. 4 ................................................................................................................................. 5 ................................................................................................................................. Percent of consumers that experience net cost Average LCC savings * (2021$) 1 2 4 $0.0 7 56 0 24 29 * The savings represent the average LCC for affected consumers. TABLE V.12—AVERAGE LCC AND PBP RESULTS FOR FRONT-LOADING, STANDARD-SIZE RESIDENTIAL CLOTHES WASHERS Average costs (2021$) TSL Efficiency level Installed cost 1 .................. 2, 3 .............. 4 .................. 5 .................. Baseline .......................... 1 ..................................... 2 ..................................... 3 ..................................... 4 ..................................... $1,195 1,213 1,226 1,244 1,265 First year’s operating cost Lifetime operating cost $146 140 133 131 126 Simple payback (years) LCC $1,664 1,589 1,513 1,488 1,424 $2,859 2,802 2,740 2,732 2,689 Average lifetime (years) ........................ 2.8 2.4 3.2 3.4 13.7 13.7 13.7 13.7 13.7 Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative to the baseline product. ddrumheller on DSK120RN23PROD with PROPOSALS2 TABLE V.13—AVERAGE LCC AND PBP RESULTS FOR FRONT-LOADING, STANDARD-SIZE RESIDENTIAL CLOTHES WASHERS Life-cycle cost savings TSL Efficiency level 1 ................................................................................................................................. 2, 3 ............................................................................................................................. 4 ................................................................................................................................. VerDate Sep<11>2014 21:56 Mar 02, 2023 Jkt 259001 PO 00000 Frm 00069 Fmt 4701 Sfmt 4702 Average LCC savings * (2021$) 1 2 3 E:\FR\FM\03MRP2.SGM $57 78 19 03MRP2 Percent of consumers that experience net cost 0 0 24 13588 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules TABLE V.13—AVERAGE LCC AND PBP RESULTS FOR FRONT-LOADING, STANDARD-SIZE RESIDENTIAL CLOTHES WASHERS—Continued Life-cycle cost savings TSL Efficiency level 5 ................................................................................................................................. Percent of consumers that experience net cost Average LCC savings * (2021$) 4 55 18 * The savings represent the average LCC for affected consumers. 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. Table V.14 through Table V.18 compares the average LCC savings and PBP at each efficiency level for the consumer subgroups with similar metrics for the entire consumer sample for each RCW product class. The percent of low-income RCW consumers experiencing a net cost is smaller than the full LCC sample in all cases, largely due to the proportion of renter households. The percent of senior-only households experiencing a net cost is higher than the full LCC sample, largely due to the lower washer usage frequency. Chapter 11 of the NOPR TSD presents the complete LCC and PBP results for the subgroups. TABLE V.14—COMPARISON OF LCC SAVINGS AND PBP FOR CONSUMER SUBGROUPS AND ALL HOUSEHOLDS; SEMIAUTOMATIC RESIDENTIAL CLOTHES WASHERS Low-income households Senior-only households All households Average LCC Savings (2021$) TSL 1–4 ....................................................................................................................................... TSL 5 ........................................................................................................................................... 389 258 265 174 329 219 0.1 0.2 0.4 0.5 0.3 0.4 18 80 21 92 21 92 0 0 0 0 0 0 Payback Period (years) TSL 1–4 ....................................................................................................................................... TSL 5 ........................................................................................................................................... Consumers with Net Benefit (%) TSL 1–4 ....................................................................................................................................... TSL 5 ........................................................................................................................................... Consumers with Net Cost (%) TSL 1–4 ....................................................................................................................................... TSL 5 ........................................................................................................................................... TABLE V.15—COMPARISON OF LCC SAVINGS AND PBP FOR CONSUMER SUBGROUPS AND ALL HOUSEHOLDS; TOPLOADING, ULTRA-COMPACT RESIDENTIAL CLOTHES WASHERS Low-income households Senior-only households All households Average LCC Savings (2021$) TSL 1–5 ....................................................................................................................................... $0 $0 $0 ........................ ........................ ........................ 0% 0% 0% 0% 0% 0% Payback Period (years) ddrumheller on DSK120RN23PROD with PROPOSALS2 TSL 1–5 ....................................................................................................................................... Consumers with Net Benefit (%) TSL 1–5 ....................................................................................................................................... Consumers with Net Cost (%) TSL 1–5 ....................................................................................................................................... VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 PO 00000 Frm 00070 Fmt 4701 Sfmt 4702 E:\FR\FM\03MRP2.SGM 03MRP2 13589 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules TABLE V.16—COMPARISON OF LCC SAVINGS AND PBP FOR CONSUMER SUBGROUPS AND ALL HOUSEHOLDS; TOPLOADING, STANDARD-SIZE RESIDENTIAL CLOTHES WASHERS Low-income households Senior-only households All households Average LCC Savings (2021$) TSL TSL TSL TSL 1, 2 ....................................................................................................................................... 3 ........................................................................................................................................... 4 ........................................................................................................................................... 5 ........................................................................................................................................... $175 186 189 214 $77 37 62 81 $138 115 134 157 2.7 4.0 3.5 3.2 6.3 9.4 8.1 7.6 4.6 6.8 5.9 5.5 47 45 72 78 39 29 59 66 46 39 69 76 8 15 13 13 22 38 35 33 14 28 25 23 Payback Period (years) TSL TSL TSL TSL 1, 2 ....................................................................................................................................... 3 ........................................................................................................................................... 4 ........................................................................................................................................... 5 ........................................................................................................................................... Consumers with Net Benefit (%) TSL TSL TSL TSL 1, 2 ....................................................................................................................................... 3 ........................................................................................................................................... 4 ........................................................................................................................................... 5 ........................................................................................................................................... Consumers with Net Cost (%) TSL TSL TSL TSL 1, 2 ....................................................................................................................................... 3 ........................................................................................................................................... 4 ........................................................................................................................................... 5 ........................................................................................................................................... TABLE V.17—COMPARISON OF LCC SAVINGS AND PBP FOR CONSUMER SUBGROUPS AND ALL HOUSEHOLDS; FRONTLOADING, COMPACT RESIDENTIAL CLOTHES WASHERS Low-income households Senior-only households All households Average LCC Savings (2021$) TSL 1–3 ....................................................................................................................................... TSL 4 ........................................................................................................................................... TSL 5 ........................................................................................................................................... $0 27 73 $0 3 44 $0 7 56 0.0 6.7 5.2 0.0 9.9 7.8 0.0 9.1 7.1 0 21 65 0 14 67 0 15 70 0 10 14 0 25 32 0 24 29 Payback Period (years) TSL 1–3 ....................................................................................................................................... TSL 4 ........................................................................................................................................... TSL 5 ........................................................................................................................................... Consumers with Net Benefit (%) TSL 1–3 ....................................................................................................................................... TSL 4 ........................................................................................................................................... TSL 5 ........................................................................................................................................... Consumers with Net Cost (%) ddrumheller on DSK120RN23PROD with PROPOSALS2 TSL 1–3 ....................................................................................................................................... TSL 4 ........................................................................................................................................... TSL 5 ........................................................................................................................................... TABLE V.18—COMPARISON OF LCC SAVINGS AND PBP FOR CONSUMER SUBGROUPS AND ALL HOUSEHOLDS; FRONTLOADING, STANDARD-SIZE RESIDENTIAL CLOTHES WASHERS Low-income households Senior-only households All households Average LCC Savings (2021$) TSL 1 ........................................................................................................................................... TSL 2, 3 ....................................................................................................................................... TSL 4 ........................................................................................................................................... VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 PO 00000 Frm 00071 Fmt 4701 Sfmt 4702 E:\FR\FM\03MRP2.SGM $56 80 25 03MRP2 $39 52 8 $57 78 19 13590 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules TABLE V.18—COMPARISON OF LCC SAVINGS AND PBP FOR CONSUMER SUBGROUPS AND ALL HOUSEHOLDS; FRONTLOADING, STANDARD-SIZE RESIDENTIAL CLOTHES WASHERS—Continued Low-income households TSL 5 ........................................................................................................................................... Senior-only households All households 63 32 55 2.0 1.7 2.3 2.4 3.8 3.3 4.3 4.5 2.8 2.4 3.2 3.4 1 6 29 65 2 7 22 63 2 7 28 74 0 1 19 20 0 1 31 29 0 0 24 18 Payback Period (years) TSL TSL TSL TSL 1 ........................................................................................................................................... 2, 3 ....................................................................................................................................... 4 ........................................................................................................................................... 5 ........................................................................................................................................... Consumers with Net Benefit (%) TSL TSL TSL TSL 1 ........................................................................................................................................... 2, 3 ....................................................................................................................................... 4 ........................................................................................................................................... 5 ........................................................................................................................................... Consumers with Net Cost (%) TSL TSL TSL TSL 1 ........................................................................................................................................... 2, 3 ....................................................................................................................................... 4 ........................................................................................................................................... 5 ........................................................................................................................................... c. Rebuttable Presumption Payback As discussed in section III.F.2 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. 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 RCWs. 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. Table V.19 presents the rebuttablepresumption payback periods for the considered TSLs for RCWs. 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.19—REBUTTABLE-PRESUMPTION PAYBACK PERIODS Trial standard level Product class 1 2 3 4 5 (years) Semi-Automatic .................................................................... Top-Loading, Ultra-Compact * .............................................. Top-Loading, Standard-Size ................................................ Front-Loading, Compact ...................................................... Front-Loading, Standard-Size .............................................. 0.2 n.a. 4.2 6.5 2.8 0.2 n.a. 4.2 6.5 2.5 0.2 n.a. 6.2 6.5 2.5 0.2 n.a. 5.3 7.5 3.3 0.3 n.a. 4.8 6.0 3.4 * The entry ‘‘n.a.’’ means not applicable because the evaluated standard is the baseline. ddrumheller on DSK120RN23PROD with PROPOSALS2 2. Economic Impacts on Manufacturers DOE performed an MIA to estimate the impact of amended energy conservation standards on manufacturers of RCWs. 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. See section V.B.1 of this document for VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 a discussion of the potential impacts on consumers. 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. The following tables summarize the estimated financial impacts (represented by changes in INPV) of potential amended energy conservation standards PO 00000 Frm 00072 Fmt 4701 Sfmt 4702 on manufacturers of RCWs, as well as the conversion costs that DOE estimates manufacturers of RCWs 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. The preservation of gross margin percentage applies a ‘‘gross E:\FR\FM\03MRP2.SGM 03MRP2 13591 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules margin percentage’’ of 18 percent for all product classes and all efficiency levels.116 This scenario assumes that a manufacturer’s per-unit dollar profit would increase as MPCs increase in the standards cases and represents the upper-bound to industry profitability under potential amended energy conservation standards. The preservation of operating profit scenario reflects manufacturers’ concerns about their inability to maintain margins as MPCs increase to reach more-stringent efficiency levels. In this scenario, while manufacturers make the necessary investments required to convert their facilities to produce compliant products, operating profit does not change in absolute dollars and decreases as a percentage of revenue. 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. TABLE V.20—MANUFACTURER IMPACT ANALYSIS RESULTS FOR RESIDENTIAL CLOTHES WASHERS INPV ................. Change in INPV *. Free Cash Flow (2026) *. Change in Free Cash Flow (2026) *. Conversion Costs. Unit No-newstandards case TSL 1 TSL 2 TSL 3 TSL 4 2021$ millions % ..................... 1,738.3 .................. 1,680.4 to 1,746.4 ... (3.3) to 0.5 ............... 1,636.5 to 1,702.9 ... (5.9) to (2.0) ............ 1,490.3 to 1,631.0 ... (14.3) to (6.2) .......... 1,208.1 to 1,376.7 ... (30.5) to (20.8) ........ 798.7 to 985.9 (54.1) to (43.3) 139.9 117.5 ....................... 90.8 ......................... 13.7 ......................... (150.0) ..................... (396.7) % ..................... .................. (16.0) ....................... (35.1) ....................... (90.2) ....................... (207.3) ..................... (383.7) 2021$ millions .................. 56.5 ......................... 118.7 ....................... 302.2 ....................... 690.8 ....................... 1,253.8 2021$ millions TSL 5 ddrumheller on DSK120RN23PROD with PROPOSALS2 * Parentheses denote negative (¥) values. The majority of the INPV impacts are associated with standard-size product classes because standard-size toploading and front-loading RCWs comprise approximately 96 percent of the total RCW domestic shipments. More specifically, the majority of the INPV impacts are associated with toploading clothes washers due to the highvolume of shipments, the high percentage of shipments at minimum efficiency, and the likely design paths required to meet more stringent standards. Top-loading clothes washers account for approximately 76 percent of current standard-size RCW shipments. DOE’s shipments analysis estimates approximately 69 percent of top-loading shipments are at the baseline efficiency level. Additionally, the engineering analysis, informed by conversations with manufacturers indicates that the likely design path to meet the efficiencies required at TSL 4 and TSL 5 would require notable capital investments. In particular, standard-size top-loading units with capacities of less than 4.7 ft3 would require significant redesign associated with increasing tub capacity to meet these higher efficiencies. In contrast, only 3 percent of current front-loading shipments are at the baseline efficiency level and DOE’s engineering analysis suggests that increases in tub capacity would not be required for front-loading clothes washer models to reach max-tech. Thus, as DOE considers increasingly stringent TSLs, the standard-size top-loading product class tends to drive industry investments and negative INPV impacts. See chapter 5 of the NOPR TSD for a detailed discussion of design paths to reach higher efficiencies. At TSL 1, the standard represents the least stringent efficiencies (EL 1) for all product classes. The change in INPV is expected to range from –3.3 to 0.5 percent. At this level, free cash flow is estimated to decrease by 16.0 percent compared to the no-new-standards case value of $139.9 million in the year 2026, the year before the standards year. DOE’s shipments analysis estimates approximately 48 percent of current shipments meet this level. At TSL 1, DOE expects most manufacturers would incur limited conversion costs to reach the efficiencies required. The conversion costs primarily stem from changes required for top-loading standard-size clothes washers. DOE’s shipments analysis estimates approximately 31 percent of current standard-size toploading clothes washers meet this level (EL 1). In contrast, nearly all the frontloading standard-size clothes washers currently meet the efficiencies required at this level. Industry capital conversion costs include tooling updates and costs associated with transitioning models with porcelain wash baskets to stainless-steel wash baskets. Product conversion costs may be necessary for product development and testing. DOE expects industry to incur some reflooring costs. DOE estimates capital conversion costs of $30.1 million and product conversion costs of $26.3 116 The gross margin percentage of 18 percent is based on a manufacturer markup of 1.22. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 PO 00000 Frm 00073 Fmt 4701 Sfmt 4702 E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 13592 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules million. Conversion costs total $56.5 million. At TSL 1, the shipment-weighted average MPC for all RCWs is expected to increase by 6.9 percent relative to the no-new-standards case shipmentweighted average MPC for all RCWs in 2027. In the preservation of gross margin percentage scenario, the slight increase in cashflow slightly outweighs the $56.5 million in conversion costs, causing a minor positive change in INPV at TSL 1 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 $56.5 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 represents the non-max-tech efficiency levels providing the highest LCC savings for all product classes. The change in INPV is expected to range from ¥5.9 to ¥2.0 percent. At this level, free cash flow is estimated to decrease by 35.1 percent compared to the no-new-standards case value of $139.9 million in the year 2026, the year before the standards year. DOE’s shipments analysis estimates approximately 47 percent of current shipments meet this level. For standard-size front-loading clothes washers, TSL 2 corresponds to EL 2. For the remaining product classes, TSL 2 corresponds to the same efficiencies required at TSL 1 (EL 1). The increase in conversion costs from the prior TSL are entirely due to the efficiency level requirements for standard-size front-loading clothes washers. DOE’s shipments analysis estimates approximately 91 percent of current standard-size front-loading clothes washer shipments meet or exceed TSL 2 efficiencies. Of the seven OEMs with standard-size front-loading clothes washer models, there is one OEM that does not currently offer a product that meets TSL 2 efficiencies. DOE assumed that this manufacturer would redesign and re-tool to meet TSL 2 in its estimate of conversion costs. That manufacturer accounts for the majority of the increase in conversion costs. DOE estimates capital conversion costs of $81.1 million and product conversion costs of $37.6 million. Conversion costs total $118.7 million. At TSL 2, the shipment-weighted average MPC for all RCWs is expected to increase by 6.9 percent relative to the no-new-standards case shipmentweighted average MPC for all RCWs in 2027. In the preservation of gross VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 margin percentage scenario, the slight increase in cashflow is outweighed by the $118.7 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 $118.7 million in conversion costs incurred by manufacturers cause a slightly negative change in INPV at TSL 2 under the preservation of operating profit scenario. At TSL 3, the standard represents the current ENERGY STAR efficiency level for all product classes that are eligible for the program, and a gap fill level for the semi-automatic product class. The change in INPV is expected to range from ¥14.3 to ¥6.2 percent. At this level, free cash flow is estimated to decrease by 90.2 percent compared to the no-new-standards case value of $139.9 million in the year 2026, the year before the standards year. DOE’s shipments analysis estimates approximately 45 percent of current shipments meet this level. For standard-size top-loading clothes washers, TSL 3 corresponds to EL 2. For the remaining product classes, the efficiencies required at TSL 3 are the same as TSL 2. Approximately 29 percent of current standard-size toploading clothes washer shipments meet the efficiencies required by TSL 3. However, most manufacturers with standard-size top-loading models offer products at or above the efficiencies required at this level. Of the nine OEMs with standard-size top-loading products, six OEMs offer models that meet the efficiencies required. To meet TSL 3, DOE expects manufacturers would incorporate wash plate designs, direct drive motors, and hardware features enabling spin speed increases into standard-size top-loading RCWs. Beyond these design options, some manufacturers may need to increase the tub capacities of certain standard-size top-loading clothes washers (i.e., models with capacities of less than 4.4 ft3). Increasing clothes washer capacity could require a new cabinet, tub, and drum designs, which would necessitate costly investments in manufacturing equipment and tooling. Product conversion costs may be necessary for designing, prototyping, and testing new or updated platforms. Additionally, DOE expects industry to incur more re-flooring costs compared to prior TSLs as more display units would need to be replaced. The increase in conversion costs at TSL 3 are entirely due to the increased stringency for PO 00000 Frm 00074 Fmt 4701 Sfmt 4702 standard-size top-loading clothes washers. DOE estimates capital conversion costs of $216.4 million and product conversion of costs of $85.7 million. Conversion costs total $302.2 million. At TSL 3, the shipment-weighted average MPC for all RCWs is expected to increase by 14.1 percent relative to the no-new-standards case shipmentweighted average MPC for all RCWs in 2027. In the preservation of gross margin percentage scenario, the increase in cashflow is outweighed by the $302.2 million in conversion costs, causing a slightly 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 $302.2 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 represents the ENERGY STAR Most Efficient level for the front-loading product classes, the CEE Tier 1 level for the top-loading standard-size product class, and a gap fill level for the semi-automatic product class. The change in INPV is expected to range from ¥30.5 to ¥20.8 percent. At this level, free cash flow is estimated to decrease by 207.3 percent compared to the no-new-standards case value of $139.9 million in the year 2026, the year before the standards year. DOE’s shipments analysis estimates approximately 14 percent of current shipments meet this level. For standard-size top-loading and standard-size front-loading clothes washers, TSL 4 corresponds to EL 3. For compact-size front-loading clothes washers, TSL 4 corresponds to EL 2. For semi-automatic clothes washers, TSL 4 corresponds to the same efficiency level as TSL 3 (EL 1). At this level, the increase in conversion costs is driven by the standard-size top-loading clothes washers product class. Currently, approximately 2 percent of standardsize top-loading shipments meet TSL 4 efficiencies. Of the nine OEMs with toploading standard-size products, only two offer models that meet the efficiencies required at TSL 4. The remaining seven OEMs would need to redesign all their existing standard-size top-loading platforms to meet this level. To meet TSL 4, top-loading clothes washer designs would likely need to incorporate hardware features to enable faster spin speeds. These hardware updates may include reinforced wash baskets, more robust suspension and E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules balancing system, and more advanced sensors. An increasing portion of toploading standard-size clothes washers (i.e., those models with capacities less than 4.7 ft3) may need an increase in tub capacity. Increasing clothes washer capacity could require new cabinet, tub, and drum designs. The changes would necessitate investments in new equipment and tooling. DOE expects industry to incur more re-flooring costs compared to prior TSLs as more display units would need to be replaced. DOE estimates capital conversion costs of $507.9 million and product conversion of costs of $200.8 million. Conversion costs total $708.6 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 TSL 4, the shipment-weighted average MPC for all RCWs is expected to increase by 15.6 percent relative to the no-new-standards case shipmentweighted average MPC for all RCWs in 2027. In the preservation of gross margin percentage scenario, the increase in cashflow is outweighed by the $690.8 million in conversion costs, causing a notable 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 $690.8 million in conversion costs incurred by manufacturers cause a significant negative change in INPV at TSL 4 under the preservation of operating profit scenario. At TSL 5, the standard represents the max-tech energy and water efficiencies for all product classes. The change in INPV is expected to range from ¥54.1 to ¥43.3 percent. At this level, free cash flow is estimated to decrease by 383.7 percent compared to the no-newstandards case value of $139.9 million in the year 2026, the year before the standards year. DOE’s shipments analysis estimates approximately 3 percent of current shipments meet this level. As previously discussed, the max-tech efficiencies required for standard-size clothes washers drive the increase in conversion costs from the prior TSLs. Currently, less than 1 percent of standard-size top-loading clothes washer shipments and approximately 9 percent of standard-size front-loading clothes washer shipments meet maxtech levels. Out of the nine standard- VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 size top-loading OEMs, only one offers models that meet the efficiencies required by TSL 5. Out of the seven standard-size front-loading OEMs, only two offer models that meet the efficiencies required by TSL 5. Max-tech would require most manufacturers to significantly redesign their clothes washer platforms. DOE expects most standard-size clothes washer manufacturers would need to further increase spin speeds as compared to prior TSLs. An increasing portion of top-loading standard-size clothes washers (i.e., models with capacities of less than 5.0 ft3) may need to increase tub capacity to achieve the RMCs required at this level. In interviews, two manufacturers stated that max-tech levels would require a total renovation of existing production facilities. Some manufacturers further stated that their product portfolio would be limited due to the lack of differentiation possible under a max-tech standard, which would potentially limit their ability to serve certain consumer segments and hurt profitability. DOE expects industry would incur approximately the same reflooring costs as TSL 4 since few models exist at the higher levels. At TSL 5, reaching max-tech efficiency levels is a billion-dollar investment for industry. DOE estimates capital conversion costs of $1,013.3 million and product conversion of costs of $240.5 million. Conversion costs total $1,253.8 million. At TSL 5, 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 TSL 5, the shipment-weighted average MPC for all RCWs is expected to increase by 17.1 percent relative to the no-new-standards case shipmentweighted average MPC for all RCWs in 2027. In the preservation of gross margin percentage scenario, the increase in cashflow is outweighed by the $1,253.8 million in conversion costs, causing a significant 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 reduction in the manufacturer markup and the $1,253.8 million in conversion costs incurred by manufacturers cause a significant negative change in INPV at TSL 5 under the preservation of operating profit scenario. DOE seeks comments, information, and data on the capital conversion costs PO 00000 Frm 00075 Fmt 4701 Sfmt 4702 13593 and product conversion costs estimated for each TSL. b. Direct Impacts on Employment To quantitatively assess the potential impacts of amended energy conservation standards on direct employment in the RCW 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 2020 ASM,117 BLS employee compensation data,118 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 92 percent of RCWs are produced domestically. 117 U.S. Census Bureau, Annual Survey of Manufactures. ‘‘Summary Statistics for Industry Groups and Industries in the U.S. (2020).’’ Available at: www.census.gov/data/tables/timeseries/econ/asm/2018-2020-asm.html (Last accessed July 15, 2022). 118 U.S. Bureau of Labor Statistics. ‘‘Employer Costs for Employee Compensation.’’ June 16, 2022. Available at: www.bls.gov/news.release/pdf/ ecec.pdf (Last accessed July 27, 2022). E:\FR\FM\03MRP2.SGM 03MRP2 13594 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules 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 products covered by this proposed rulemaking. 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 previously, 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-newstandards case and standards cases. Using the GRIM, DOE estimates in the absence of new energy conservation standards there would be 9,222 domestic workers for RCWs in 2027. Table V.21 shows the range of the impacts of energy conservation standards on U.S. manufacturing employment in the RCW industry. The following discussion provides a qualitative evaluation of the range of potential impacts presented in Table V.21. TABLE V.21—DOMESTIC DIRECT EMPLOYMENT IMPACTS FOR RESIDENTIAL CLOTHES WASHER MANUFACTURERS IN 2027 No-newstandards case Direct Employment (Production Workers + NonProduction Workers). Potential Changes in Direct Employment Workers *. TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 9,222 10,511 ................ 10,504 ................ 11,710 ................ 11,973 ................ 11,939 ........................ (8,121) to 1,289 .. (8,121) to 1,282 .. (8,121) to 2,488 .. (8,121) to 2,751 .. (8,121) to 2,717 ddrumheller on DSK120RN23PROD with PROPOSALS2 * DOE presents a range of potential direct employment impacts. Numbers in parentheses indicate negative numbers. The direct employment impacts shown in Table V.21 represent the potential domestic employment changes that could result following the compliance date for the RCWs covered in this proposal. The upper bound estimate corresponds to an increase in the number of domestic workers that results from amended energy conservation standards if manufacturers continue to produce the same scope of covered products within the United States after compliance takes effect. To establish a conservative lower bound, DOE assumes all manufacturers would shift production to foreign countries. At lower TSLs, DOE believes the likelihood of changes in production location due to amended standards are low due to the relatively minor production line updates required. However, as amended standards increase in stringency and both the complexity and cost of production facility updates increases, manufacturers are more likely to revisit their production location decisions. At max-tech, manufacturers representing a large portion of the market noted concerns about the level of investment, about the potential need to relocate production lines in order to remain competitive, and about the conversion period of 3 years being insufficient to make the necessary manufacturing line updates. Additional detail on the analysis of direct employment can be found in chapter 12 of the NOPR TSD. Additionally, the employment impacts VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 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, meeting the efficiencies required for each TSL would require varying levels of resources and investment. A standard level requiring notably faster spin speeds, namely TSL 4 and TSL 5, would necessitate product redesign to account for the increased spin speeds as well as the noise, vibration, and fabric care concerns related to the spin speeds required to meet these higher TSLs. These updates may include designing and manufacturing reinforced wash baskets, instituting a more robust suspension and balancing system, increasing the number of sensors, and incorporating more advanced sensors. For standardsize top-loading clothes washers, manufacturers would also need to increase tub capacity of smaller models to meet the efficiencies required at higher TSLs. Many manufacturers would need to invest in new tooling and equipment to either produce entirely new wash basket lines or ramp up production of their existing larger capacity wash baskets. Based on a review of CCD model listings, DOE’s engineering analysis indicates that tub capacity would need to increase to 4.4 ft3 at TSL 3, 4.7 ft3 at TSL 4, and 5.0 PO 00000 Frm 00076 Fmt 4701 Sfmt 4702 ft3 at TSL 5 for the top-loading standardsize product class.119 In interviews, some manufacturers expressed concerns—particularly at max-tech— that the 3-year period between the announcement of the final rule and the compliance date of the amended energy conservation standard might be insufficient to update production facilities and design, test, and manufacture the necessary number of products to meet demand. For the remaining TSLs (i.e., TSL 1, TSL 2, and TSL 3) most manufacturers could likely maintain manufacturing capacity levels and continue to meet market demand under amended energy conservation standards. DOE seeks comment on whether manufacturers expect manufacturing capacity constraints due to production facility updates would limit product availability to consumers in the timeframe of the amended standard compliance date (2027). 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 119 Based on the increase in cost associated with implementing a larger capacity tub, DOE expects that if a higher efficiency level were possible to achieve without an increase in capacity, such products would be available on the market. E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules 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 proposed 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. In summary, the Small Business Administration (‘‘SBA’’) defines a ‘‘small business’’ as having 1,500 employees or less for NAICS 335220, ‘‘Major Household Appliance Manufacturing.’’ 120 Based on this classification, DOE identified one domestic OEM that qualifies as a small business. For a discussion of the impacts on the small business manufacturer subgroup, see the Regulatory Flexibility Analysis in 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 13595 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 RCW manufacturers that take effect approximately three years before or after the 2027 compliance date. In response to the September 2021 Preliminary Analysis, stakeholders commented on the cumulative regulatory burden analysis. See section IV.J.3.c for a summary of stakeholder comments and DOE’s initial responses. TABLE V.22—COMPLIANCE DATES AND EXPECTED CONVERSION EXPENSES OF FEDERAL ENERGY CONSERVATION STANDARDS AFFECTING RESIDENTIAL CLOTHES WASHER ORIGINAL EQUIPMENT MANUFACTURERS 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) ................................................................ Consumer Furnaces †, 87 FR 40590 (July 7, 2022) ................................................................ Commercial Water Heating Equipment †, 87 FR 30610 (May 19, 2022) ...................................... Consumer Clothes Dryers †, 87 FR 51734 (August 23, 2022) .................................................. Microwave Ovens †, 87 FR 52282 (August 24, 2022) ................................................................ Consumer Conventional Cooking Products †, 88 FR 6818 (February 1, 2023) ............................ Consumer Refrigerators, Refrigerator-Freezes, and Freezers †‡ ................................................ ddrumheller on DSK120RN23PROD with PROPOSALS2 Number of OEMs affected from today’s rule ** Approx. standards year Industry conversion costs (millions $) Industry conversion costs/ product revenue *** (%) 11 2 2025 $320.9 (2015$) 6.7 8 4 2026 $22.8 (2020$) 0.5 15 1 2029 $150.6 (2020$) 1.4 14 1 2026 $34.6 (2020$) 4.7 15 12 2027 $149.7 (2020$) 1.8 18 9 2026 $46.1 (2021$) 0.7 34 9 2027 $183.4 (2021$) 1.2 49 12 2027 $1,323.6 (2021$) 3.8 * 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 RCWs 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. † These rulemakings are in the proposed rule stage and all values are subject to change until finalized. ‡ At the time of issuance of this RCW proposed rule, this rulemaking has been issued and is pending publication in the Federal Register. Once published, the consumer refrigerators, refrigerator-freezers, and freezers proposed rule will be available at: www.regulations.gov/docket/ EERE-2017-BT-STD-0003. DOE requests information regarding the impact of cumulative regulatory burden on manufacturers of RCWs associated with multiple DOE standards or product-specific regulatory actions of other Federal agencies. 3. National Impact Analysis 120 U.S. Small Business Administration. ‘‘Table of Small Business Size Standards.’’ (Effective July 14, 2022). Available at: www.sba.gov/document/ support-table-size-standards (Last accessed August 16, 2022). VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 PO 00000 Frm 00077 Fmt 4701 Sfmt 4702 This section presents DOE’s estimates of the national energy and water savings E:\FR\FM\03MRP2.SGM 03MRP2 13596 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules and the NPV of consumer benefits that would result from each of the TSLs considered as potential amended standards. a. Significance of Energy and Water Savings To estimate the energy and water savings attributable to potential compliance with amended standards (2027–2056). Table V.23 and Table V.24 present DOE’s projections of the national energy and water savings for each TSL considered for RCWs, respectively. The savings were calculated using the approach described in section IV.H of this document. amended standards for RCWs, DOE compared their energy and water consumption under the no-newstandards case to their anticipated energy and water 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 TABLE V.23—CUMULATIVE NATIONAL ENERGY SAVINGS FOR RESIDENTIAL CLOTHES WASHERS; 30 YEARS OF SHIPMENTS [2027–2056] Trial standard level 1 2 3 4 5 (quads) Primary energy ..................................................................... FFC energy .......................................................................... 0.59 0.61 0.59 0.62 0.70 0.74 1.39 1.45 2.15 2.27 TABLE V.24—CUMULATIVE NATIONAL WATER SAVINGS FOR RESIDENTIAL CLOTHES WASHERS; 30 YEARS OF SHIPMENTS [2027–2056] Trial standard level 1 2 3 4 5 (trillion gallons) Water Savings ...................................................................... OMB Circular A–4 121 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 proposed rulemaking, DOE undertook a sensitivity analysis using 9 years, rather 1.26 1.27 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.122 The review timeframe established in EPCA is generally not synchronized with the product lifetime, product manufacturing cycles, or other factors specific to RCWs. Thus, such 2.07 2.53 2.94 results are presented for informational purposes only and are not indicative of any change in DOE’s analytical methodology. The NES and NWS sensitivity analysis results based on a 9year analytical period are presented in Table V.25 and Table V.26. The impacts are counted over the lifetime of RCWs purchased in 2027–2035. TABLE V.25—CUMULATIVE NATIONAL ENERGY SAVINGS FOR RESIDENTIAL CLOTHES WASHERS; 9 YEARS OF SHIPMENTS [2027–2035] Trial standard level 1 2 3 4 5 (quads) ddrumheller on DSK120RN23PROD with PROPOSALS2 Primary energy ..................................................................... FFC energy .......................................................................... 121 U.S. Office of Management and Budget. Circular A–4: Regulatory Analysis. September 17, 2003. obamawhitehouse.archives.gov/omb/ circulars_a004_a-4/ (Last accessed June 12, 2022). 122 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 VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 0.24 0.26 0.25 0.26 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 PO 00000 Frm 00078 Fmt 4701 Sfmt 4702 0.29 0.31 0.50 0.53 0.72 0.75 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. E:\FR\FM\03MRP2.SGM 03MRP2 13597 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules TABLE V.26—CUMULATIVE NATIONAL WATER SAVINGS FOR RESIDENTIAL CLOTHES WASHERS; 9 YEARS OF SHIPMENTS [2027–2035] Trial standard level 1 2 3 4 5 (trillion gallons) Water Savings ...................................................................... b. Net Present Value of Consumer Costs and Benefits DOE estimated the cumulative NPV of the total costs and savings for 0.51 0.52 consumers that would result from the TSLs considered for RCWs. In accordance with OMB’s guidelines on regulatory analysis,123 DOE calculated NPV using both a 7-percent and a 3- 0.79 0.93 1.04 percent real discount rate. Table V.27 shows the consumer NPV results with impacts counted over the lifetime of products purchased in 2027–2056. TABLE V.27—CUMULATIVE NET PRESENT VALUE OF CONSUMER BENEFITS FOR RESIDENTIAL CLOTHES WASHERS; 30 YEARS OF SHIPMENTS [2027–2056] Trial standard level Discount rate 1 2 3 4 5 (billion 2021$) 3 percent .............................................................................. 7 percent .............................................................................. The NPV results based on the aforementioned 9-year analytical period are presented in Table V.28. The impacts are counted over the lifetime of 8.39 3.36 8.50 3.41 products purchased in 2027–2035. As mentioned previously, such results are presented for informational purposes only and are not indicative of any 8.13 2.48 14.52 5.14 20.77 7.68 change in DOE’s analytical methodology or decision criteria. TABLE V.28—CUMULATIVE NET PRESENT VALUE OF CONSUMER BENEFITS FOR RESIDENTIAL CLOTHES WASHERS; 9 YEARS OF SHIPMENTS [2027–2035] Trial standard level Discount rate 1 2 3 4 5 (billion 2021$) ddrumheller on DSK120RN23PROD with PROPOSALS2 3 percent .............................................................................. 7 percent .............................................................................. 3.90 1.93 3.97 1.96 The previous results reflect the use of a default trend to estimate the change in price for RCWs 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 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. 123 U.S. Office of Management and Budget. Circular A–4: Regulatory Analysis. September 17, 2003. Available at obamawhitehouse.archives.gov/ VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 c. Indirect Impacts on Employment It is estimated that that amended energy conservation standards for RCWs would reduce energy and water 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 PO 00000 Frm 00079 Fmt 4701 Sfmt 4702 3.68 1.39 6.13 2.74 8.35 3.95 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– 2031), 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, omb/circulars_a004_a-4/ (Last accessed June 12, 2022). E:\FR\FM\03MRP2.SGM 03MRP2 13598 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules unanticipated effects on employment. Chapter 16 of the NOPR TSD presents detailed results regarding anticipated indirect employment impacts. ddrumheller on DSK120RN23PROD with PROPOSALS2 4. Impact on Utility or Performance of Products As discussed, 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)) a. Performance Characteristics EPCA authorizes DOE to design test procedures that measure energy efficiency, energy use, water use (in the case of showerheads, faucets, water closets and urinals), or estimated annual operating cost of a covered product during a representative average use cycle or period of use. (42 U.S.C. 6293(b)(3)) Currently, DOE’s test procedure addresses the energy and water efficiency of clothes washers, and DOE’s clothes washer test procedures do not prescribe a method for testing clothes washer cleaning performance or other consumer-relevant attributes of performance. Representative average use of a clothes washer reflects, in part, a consumer using the clothes washer to achieve an acceptable level of cleaning performance. DOE recognizes that in general, a consumer-acceptable level of cleaning performance can be easier to achieve through the use of higher amounts of energy and water use during the clothes washer cycle. Conversely, maintaining acceptable cleaning performance can be more difficult as energy and water levels are reduced. Improving one aspect of clothes washer performance, such as reducing energy and/or water use as a result of energy conservation standards, may require manufacturers to make a trade-off with one or more other aspects of performance, such as cleaning performance, depending on which performance characteristics are prioritized by the manufacturer. DOE expects, however, that consumers maintain the same expectations of cleaning performance regardless of the efficiency of the clothes washer. As the clothes washer market continuously evolves to higher levels of efficiency— either as a result of mandatory minimum standards or in response to voluntary programs such as ENERGY STAR—it becomes increasingly more important that DOE ensures that its test procedure continues to reflect representative use. As such, the normal cycle that is used to test the clothes VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 washer for energy and water performance must be one that provides a consumer-acceptable level of cleaning performance, even as efficiency increases. Whirlpool commented that amended standards would result in an increase in purchase price and perceptible differences in product performance including cycle time, vibration and noise, fabric care, cleaning and rinse performance, and detergent effectiveness. (Whirlpool, No. 39 at pp. 8–9) Whirlpool commented that it does not recommend that DOE develop a performance requirement, like that under consideration for dishwashers currently, but rather referenced the EPCA requirement that DOE consider performance and the impacts to consumer utility as one of the seven statutory factors for considering whether a standard is justified. (Id.) Whirlpool recommended that DOE conclude that amended standards are not justified due to the potential to lessen utility and performance of clothes washers, particularly for top-loading standardsize clothes washers. (Id.) Regarding cycle time specifically, Whirlpool commented that amended standards could require an increase in cycle time. (Whirlpool, No. 39 at p. 9) Specifically, Whirlpool explained that the wash phase of the cycle may need to be longer in order to compensate for decreased water temperatures and reduced load motion due to increased pauses to allow for motor cooling; the spin phase would need to be longer to reduce RMC; and that as spin speeds increase, cycle time could be increased due to a greater risk of out-of-balance conditions, which require more sensing and re-balancing to address. Whirlpool also commented that appendix J would require spinning at maximum speed for both small and large load sizes and noted that smaller loads do not extract moisture as well as larger loads, and therefore would require even more spin time. (Id.) Whirlpool also asserted that because increased spin time may lead to greater electrical energy use by the clothes washers, the annual energy consumption reported on the EnergyGuide label may show an increase in energy use for new higherefficiency models, which would be counterintuitive for consumers. (Id.) Regarding vibration and noise specifically, Whirlpool commented that it would expect higher overall noise and vibration levels as a result of increased spin speeds and spin times. (Whirlpool, No. 39 at p. 10) In addition, the drivetrain may produce louder sounds due to the additional motor torque required to move a load with lower PO 00000 Frm 00080 Fmt 4701 Sfmt 4702 water levels. (Id.) Whirlpool also commented that the higher risk of outof-balance conditions from faster spin speeds may also contribute to higher noise and vibration levels. (Id.) Whirlpool recommended that DOE account for any additional product cost required to keep sound and vibration levels where they are currently to prevent consumer dissatisfaction at higher efficiency levels. (Id.) Regarding fabric care specifically, Whirlpool commented if wash time is lengthened in order to compensate for reduced water temperatures, the additional agitation on the clothes may lead to increased fabric wear and damage. (Whirlpool, No. 39 at pp. 10– 11) Whirlpool also commented that faster spinning would increase the degree of wrinkling in a load and that clothes may become more tangled. (Id.) Regarding cleaning and rinsing performance specifically, Whirlpool commented that amended standards could result in biofilm accumulations on internal wash unit surfaces, white residues, difficulty removing detergent and particulates, redeposition, yellowing of clothes, and reduced stain removal, especially for oily or fatty soils. (Whirlpool, No. 39 at p. 11) Whirlpool added that some of these issues (e.g., reduced stain removal) may be immediately apparent to consumers, whereas others (e.g., biofilm accumulation) may become noticeable over time. (Id.) Whirlpool commented that a correlation exists between lower water temperatures and degraded cleaning performance. (Id.) Whirlpool added that oily or fatty solids are soluble around 85 °F, that detergents can do only some of the work removing oily or fatty soils at temperatures below 85 °F, and that natural skin oils will be harder to remove under lower temperatures. (Id.) Whirlpool also commented that rinse performance could suffer as a result of the need to make trade-offs in allocating the available water between the wash and rinse phases. Whirlpool commented that reduced water during the rinse phase makes it harder to effectively remove detergent and particulates from the wash load and increases re-deposition. (Id.) Whirlpool commented that overall load motion, the degree to which the load moves in the wash bath and the amount of free water visible to the consumer, may be sacrificed as clothes washers move to faster spin and lower torque powertrains. (Whirlpool, No. 39 at p. 12) Whirlpool further commented that, according to its initial testing, a reduction in load motion of over 50 percent could result from the new E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules powertrains needed for amended standards due to the lower available torque from the motor and reduced water levels needed to meet more stringent water efficiency requirements. (Id.) Whirlpool commented in summary that cleaning in a clothes washer is a holistic experience that encompasses a consumer’s expectation of product appearance, cleanliness of the clothes washer itself, water level, water temperatures, load motion, cycle time, and cleaning performance, including stain and soil removal, particulate removal, odor removal, and detergent rinsing. (Whirlpool, No. 39 at p. 12) Whirlpool added that if consumer expectations are not met at any point, they will likely have a negative perception of product performance and often voice complaints about it in the form of a negative review or call to the manufacturer. (Id.) AHAM commented that DOE’s proposed changes to the test procedure alone, and when coupled with amended energy conservation standards, are likely to drive product performance impacts. (AHAM, No. 40 at p. 9) AHAM further commented that increasing spin speed and spin time could cause increased vibration and noise, negatively impact fabric care due to tangling and wrinkling, and increase cycle time. (AHAM, No. 40 at pp. 9–10) AHAM recommended that instead of adding a performance minimum to the test procedure, DOE should avoid changes that could impact clothes washer performance, and account for the potential impact of these changes in DOE’s amended standards analysis, as required by EPCA. (AHAM, No. 40 at p. 10) AHAM also noted that conducting a performance test may not capture all the potential impacts that standards may have on clothes washer performance. (Id.) AHAM recommended that DOE further investigate these potential impacts during manufacturer interviews. (Id.) AHAM commented that efficiency standards that require increased cycle times beyond an acceptable length would negatively impact consumers and could result in cycle times that are not synchronized with clothes dryer cycle times. (AHAM, No. 40 at p. 10) AHAM recommended against introducing a maximum cycle length requirement; instead, AHAM recommended that any potential impact of cycle time should be avoided and accounted for in DOE’s amended standards, as required by EPCA. (Id.) In addition to considering the comments summarized in this section, DOE also discussed performance VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 characteristics in detail as part of its confidential interviews with manufacturers. DOE has considered potential impacts to the various attributes of product performance as part of its consideration of amended standards, as discussed further in section V.C.1 of this document. DOE is aware of high-efficiency clothes washers that achieve equal or better cleaning performance than lowerefficiency clothes washers in third-party performance reviews. For example, DOE has consulted performance ratings published by Consumer Reports,124 which DOE recognizes is one popular resource for consumers seeking independent reviews of consumer products. According to information provided on their website, the test method used by Consumer Reports appears to be similar in nature to AHAM’s cleaning performance test procedure, but inconsistent with the test conditions prescribed by DOE’s appendix J test procedure; 125 nevertheless, its test results provide an objective measure of the performance capabilities for products currently on the market. For top-loading standard-size RCWs, Consumer Reports ratings indicate that models rated at or above TSL 4 achieve equal or better cleaning performance than models with lower efficiency ratings. Specifically, among 4 tested toploading standard-size models with an IMEF/IWF rating 126 at or above TSL 4, all of them receive a relative ‘‘washing performance’’ rating of 5 out of 5. Among 70 tested top-loading standardsize models with an IMEF/IWF rating below TSL 4, 11 models (16 percent) receive a relative rating of 5 out of 5, and 26 models (37 percent) receive a relative rating of 4 out of 5—for a total of only 53 percent of units receiving a score of 4 or 5 out of 5. These ratings suggest that top-loading standard-size RCWs with efficiency ratings at or above TSL 4 can achieve equal or better overall cleaning performance scores than models with lower efficiency ratings. For front-loading standard-size RCWs, Consumer Reports ratings indicate no significant differences between models rated at or above TSL 4 and models with 124 Consumer Reports ratings of clothes washers available at www.consumerreports.org/appliances/ washing-machines/. Last accessed September 23, 2022. 125 The Consumer Reports describes its washing performance test as reflecting the degree of color change to swatches of fabric that were included in an 8-pound test load of mixed cotton items using the unit’s ‘‘most aggressive’’ normal cycle. 126 Although the efficiency levels are defined based on EER and WER, manufacturer ratings use IMEF and IWF. PO 00000 Frm 00081 Fmt 4701 Sfmt 4702 13599 lower efficiency ratings. Specifically, among 27 tested front-loading standardsize models with an IMEF/IWF rating at or above TSL 4, 20 models (74 percent) receive a relative rating of 5 out of 5, and 6 models (22 percent) receive a relative rating of 4 out of 5—for a total of only 96 percent of units receiving a score of 4 or 5 out of 5. Among 20 tested front-loading standard-size models with an IMEF/IWF rating below TSL 4, 18 models (90 percent) receive a relative rating of 5 out of 5, and 2 models (10 percent) receive a relative rating of 4 out of 5—for a total of 100 percent of units receiving a score of 4 or 5 out of 5. These ratings suggest that front-loading standard-size RCWs with efficiency ratings at or above TSL 4 can achieve roughly equivalent overall cleaning performance scores compared to models with lower efficiency ratings. DOE seeks comment on whether the Consumer Reports test produces cleaning performance results that are representative of an average use cycle as measured by the DOE test procedure. DOE also seeks comment on how relative cleaning performance results would vary if tested under test conditions consistent with the DOE appendix J test procedure. In addition to considering the Consumer Reports ratings, DOE conducted performance testing on a representative sample of top-loading standard-size and front-loading standard-size units, which collectively represent around 98 percent of RCW shipments. The detailed results of DOE’s testing are provided in the performance characteristics test report, which is available in the docket for this rulemaking. In particular, DOE evaluated wash temperatures, stain removal, mechanical action (i.e., ‘‘wear and tear’’), and cycle duration across the range of efficiency levels considered in the analysis. Specifically, DOE evaluated wash temperatures and cycle time based on test data performed according to DOE’s new appendix J test procedure; additionally, DOE evaluated cleaning performance and fabric care based on additional testing performed according to the soil/stain removal and mechanical action tests specified in AHAM’s HLW–2–2020 test method: Performance Evaluation Procedures for Household Clothes Washers (‘‘AHAM HLW–2–2020’’). The AHAM HLW–2– 2020 test method does not prescribe specific test conditions for performing the test (e.g., inlet water temperatures conditions, load size, test cycle, or wash/rinse temperature selection). For each clothes washer in its test sample, DOE tested the Hot Wash/Cold Rinse E:\FR\FM\03MRP2.SGM 03MRP2 13600 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules ddrumheller on DSK120RN23PROD with PROPOSALS2 (‘‘Hot’’) temperature selection 127 in the Normal cycle 128 using the large load size 129 specified in appendix J, as well as using the inlet water temperatures and ambient conditions specified in appendix J. DOE specifically analyzed the Hot cycle with the large load size because (1) the Hot temperature selection would be the temperature selection most likely targeted for reduced wash temperature as a design option for achieving a higher energy efficiency rating; (2) the large load size is more challenging to clean than the small load size; and (3) all units in the test sample offer a Hot temperature selection (allowing for consistent comparison across units). DOE expects that the Hot temperature selection with the large load size is the cycle combination most likely to experience the types of performance compromises described by AHAM and manufacturers. In sum, DOE selected the most conservative assumptions for its performance testing investigation to allow DOE to better understand the potential impacts on performance at various efficiency levels for clothes washers. DOE requests comment on its use of the Hot temperature selection with the large load size to evaluate potential impacts on clothes washer performance as a result of amended standards. More specifically, DOE performed the Soil/Stain Removal test specified in section 6 of AHAM HLW–2–2020 to measure relative cleaning performance among the test sample units. AHAM HLW–2–2020 states that the purpose of the Soil/Stain Removal test is to evaluate the performance of household clothes washers in removing representative soils and stains from fabric. DOE also performed the Mechanical Action test specified in section 7 of AHAM HLW–2–2020 to measure relative fabric wear and tear among the test sample units. AHAM HLW–2–2020 states that the purpose of the Mechanical Action test is to measure the mechanical action applied by the clothes washer to the textiles. AHAM 127 Figure 2.12.1.2 of appendix J provides a flow chart defining the Hot Wash/Cold Rinse temperature selection. Generally, the Hot Wash/ Cold Rinse temperature selection corresponds to the hottest available wash temperature less than 140 °F, with certain exceptions as provided in Figure 2.12.1.2. 128 Section 1 of appendix J defines the Normal cycle as the cycle recommended by the manufacturer (considering manufacturer instructions, control panel labeling, and other markings on the clothes washer) for normal, regular, or typical use for washing up to a full load of normally soiled cotton clothing. 129 Table 5.1 of appendix J defines the small and large load sizes to be tested according to the clothes washer’s measured capacity. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 HLW–2–2020 states that this test may be performed in conjunction with the Soil/ Stain Removal test; therefore, DOE conducted both tests simultaneously on each test run. AHAM HLW–2–2020 specifies running three replications of the test method on each tested unit, with the results of the three replications averaged. DOE requests comment on its use of the Soil/Stain Removal test and Mechanical Action test specified in AHAM HLW–2–2020 as the basis for evaluating performance-related concerns expressed by AHAM and manufacturers. The performance characteristics test report provides detailed test results in table and graphical format. The discussion throughout the remainder of this section summarizes the key conclusions from the test results. With regard to hot wash temperatures, manufacturer comments (as summarized previously in this section) suggested that decreasing water temperature to achieve higher efficiency could decrease cleaning performance by making it harder to remove fatty soils, which are soluble around 85 °F. (See Whirlpool, No. 39 at p. 11) To evaluate whether more stringent standards may reduce water temperatures below the 85 °F threshold and thus potentially decrease cleaning performance for fatty soils, DOE analyzed the wash temperature of the hottest temperature selection available in the Normal cycle for each clothes washer in the test sample. For front-loading standard-size RCWs, DOE’s test data show no identifiable correlation between efficiency and the hottest available wash temperature in the Normal cycle. At the proposed standard level (i.e., TSL 4, corresponding to EL 3), considering units both slightly higher and slightly lower than EL 3, the hottest available wash temperature in the Normal cycle ranges from around 70 °F to around 140 °F. This closely matches the range of the hottest wash temperatures available on units at lower efficiency levels, which range from around 80 °F to around 155 °F. Notably, at EL 3, multiple models from multiple manufacturers provide wash temperatures higher than the 85 °F threshold and would be able to dissolve and clean fatty soils. For top-loading standard-size RCWs, DOE’s test data show that for units at EL 2 and below, the hottest available wash temperature in the Normal cycle ranges from around 70 °F to around 110 °F. At EL 3 (considering units both slightly higher and slightly lower than EL 3), the hottest available wash temperature in the Normal cycle ranges from around 80 °F to around 100 °F. Several models PO 00000 Frm 00082 Fmt 4701 Sfmt 4702 from multiple manufacturers are available with temperatures higher than the 85 °F threshold and would be able to dissolve and clean fatty soils. Based on this data, DOE tentatively concludes that the proposed standard level (i.e., TSL 4), would not require a substantive reduction in hot water temperature on the hottest temperature selection in the Normal cycle, and would not preclude the ability to provide wash temperatures above the 85 °F threshold. DOE requests comment on its wash temperature data presented in the performance characteristics test report and on its tentative conclusions derived from this data. DOE requests any additional data DOE should consider about wash temperatures at the proposed standard level, as DOE’s data leads to the tentative conclusion that fatty soils would be able to be dissolved at this efficiency level. With regard to stain removal, manufacturer comments (as summarized previously in this section) suggested that more stringent standards could result in reduced stain removal, especially for oily or fatty stains. (See Whirlpool, No. 39 at p. 11) To evaluate whether more stringent standards would result in a decrease in stain removal performance, DOE conducted the Soil/ Stain Removal test specified in AHAM HLW–2–2020 using the Hot temperature selection with the largest load size, as described. In particular, one of the stains evaluated in the AHAM HLW–2– 2020 Soil/Stain Removal test is sebum— an oily, waxy substance produced by skin glands.130 For front-loading standard-size RCWs, DOE’s test data show no observable correlation between efficiency and the total cleaning score as measured by the AHAM test method. At EL 3 (considering units both slightly higher and slightly lower than EL 3), total cleaning scores ranged from around 86 to around 99 (higher is better). At lower efficiency levels, total cleaning scores ranged from around 90 to around 96. For top-loading standard-size RCWs, DOE’s test data show that for units at EL 2 and below, total cleaning scores range from around 90 to around 98. The clustering of data at or above a score of 90 (as measured on the Hot temperature selection with the large load size) likely represents a market-representative threshold of stain removal performance as measured with this cycle configuration. DOE’s total cleaning 130 The standardized soil/stain strips used in the AHAM HLW–2–2020 test consist of square test fabric swatches carrying five different types of stains: red wine, chocolate and milk, blood, carbon black/mineral oil, and pigment/sebum. E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules scores at EL 3 for stain removal also include 90, which indicates that manufacturers can produce clothes washers at EL 3 while maintaining a level of stain removal that is marketrepresentative. DOE also looked at the implementation of prioritizing hardware design options over reduced wash temperatures. When hardware design options are implemented, DOE’s analysis suggests that the proposed standard level would not preclude the ability to provide total cleaning scores for top-loading units equally as high as the highest scores currently achieved by units at lower efficiency levels. DOE requests comment on its stain removal data presented in the performance characteristics test report and on its conclusions derived from this data. In particular, DOE requests comment on whether the clustering of data at or above a score of 90 (as measured on the Hot temperature selection with the large load size) corresponds to a market-representative threshold of stain removal performance as measured with this cycle configuration. DOE additionally requests comment on its analysis indicating that implementing additional hardware design options, rather than reducing wash temperatures, on EL 2 units could enable total cleaning scores at EL 3 that are equally as high as the highest scores currently achieved by units at lower efficiency levels. With regard to wear and tear, manufacturer comments (as summarized previously in this section) suggested that if wash time is lengthened to compensate for reduced water temperatures, the additional agitation on the clothes may lead to increased fabric wear and damage. (See Whirlpool, No. 39 at pp. 10–11; AHAM, No. 40 at pp. 9–10) To evaluate whether more stringent standards would result in an increase in wear and tear on clothing, DOE conducted the Mechanical Action test specified in AHAM HLW–2–2020 concurrently with the stain removal test as described. For top-loading standardsize RCWs, DOE’s test data show that units at EL 3 have lower (i.e., better) mechanical action scores than baselinerated units, indicating that the higherefficiency units provide less wear and tear than the baseline units in the test sample. Specifically, at EL 3, mechanical action scores ranged from around 150 to around 175, closely matching the range at EL 2, which ranged from around 150 to around 170. At lower efficiency levels, mechanical action scores ranged from around 190 to around 230. The data suggests that the better mechanical action scores at the higher efficiency levels may correlate VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 with the use of wash plates (i.e., impellers) at those levels, compared to the use of traditional agitators at the lower efficiency levels. For front-loading standard-size RCWs, DOE’s test data show that for units at or below EL 2, mechanical action scores range from around 135 to around 180. At EL 3 (considering units both slightly higher and slightly lower than EL 3), mechanical action scores range from around 160 to around 210. Although some units at EL 3 have higher (i.e., worse) mechanical action scores than the lower-efficiency units, the low end of the range is less than (i.e., better than) some of the baseline-rated units. DOE is not aware of any industry-accepted threshold for acceptable mechanical action performance, and there is no significant clustering of DOE’s data to suggest any particular marketrepresentative threshold. Based on this data, DOE tentatively concludes that the proposed standard level (i.e., TSL 4) would not preclude the ability to provide mechanical action scores comparable to the scores for units at lower efficiency levels. DOE requests comment on its mechanical action data presented in the performance characteristics test report and on its conclusions derived from this data. In particular, DOE requests comment on whether there is a marketrepresentative threshold of mechanical action performance as measured on the Hot temperature selection using the large load size. DOE also requests comment on whether better mechanical action scores at higher top-loading efficiency levels are attributable to the use of wash plates rather than traditional agitators in those higherefficiency units. With regard to cycle time, manufacturer comments (as summarized previously in this section) suggested that more stringent standards could require an increase in cycle time. (See Whirlpool, No. 39 at p. 9; AHAM, No. 40 at p. 10). To evaluate whether more stringent standards would result in an increase in cycle time, DOE measured the average cycle time as defined in appendix J for each unit in the test sample. For both top-loading standardsize and front-loading standard-size RCWs, DOE’s test data show no observable correlation between efficiency and average cycle time. For top-loading standard-size RCWs, the average cycle time for the entire product class is around 50 minutes, as measured according to the appendix J test procedure. At EL 3 (considering units both slightly higher and slightly lower than EL 3), cycle time ranged from around 35 minutes to around 65 PO 00000 Frm 00083 Fmt 4701 Sfmt 4702 13601 minutes. This closely matches the range of units at lower efficiency levels, which ranged from around 35 minutes to around 70 minutes. For front-loading standard-size RCWs, the average cycle time for the entire product class is around 45 minutes, as measured according to the appendix J test procedure. At EL 3 (considering units both slightly higher and slightly lower than EL 3), cycle time ranged from around 40 minutes to around 55 minutes. This closely matches the range of units at lower efficiency levels, which ranged from around 35 minutes to around 65 minutes. Based on this data, DOE tentatively concludes that the proposed standard level (i.e., TSL 4), would not result in an increase in average cycle time as measured by appendix J. DOE requests comment on its cycle time data presented in the performance characteristics test report and on its conclusions derived from this data. In summary, DOE’s test data suggest that the proposed standard level (i.e., TSL 4) can be achieved with key performance attributes (e.g., wash temperatures, stain removal, mechanical action, and cycle duration) that are largely comparable to the performance of lower-efficiency units available on the market today. Based on DOE’s testing of models that currently meet the proposed standards, DOE does not expect performance to be compromised at the proposed standard level. DOE seeks comment on its testing and assessment of performance attributes (i.e., wash temperatures, stain removal, mechanical action, and cycle duration), particularly at the proposed standard level (i.e., TSL 4). In addition, DOE seeks additional data that stakeholders would like DOE to consider on performance attributes at TSL 4 efficiencies as well as the current minimum energy conservation standards. b. Availability of ‘‘Traditional’’ Agitators The inner drum of a baseline standard-size top-loading RCW typically contains a vertically oriented agitator in the center of the drum, which undergoes a twisting motion. The motion of the agitator, which is powered by an electric motor, circulates the clothes around the center of the wash basket. Some agitators have a corkscrew-like design that also circulates the clothing vertically from the bottom to the top of the basket. Higher-efficiency top-loading RCWs typically use a disk-shaped ‘‘wash plate,’’ rather than a vertical agitator, to move the clothes within the basket. The rotation of the wash plate E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 13602 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules underneath the clothing circulates the clothes throughout the wash drum. A conventional agitator requires clothing to be fully suspended in water; as the agitator rotates, the agitator vanes catch the clothing and move the garments through the water. A rotating wash plate, however, requires a much lower water level inside the wash tub to clean the clothing properly. The wet clothing load sits on top of the wash plate, and as the wash plate rotates, raised fins catch the clothing along the bottom of the wash tub to rotate the garments. AHAM presented shipment data that showed the number of shipments of clothes washers with and without agitators during 2011–2020. (AHAM, No. 40 at pp. 11–12) Based on this data, AHAM concluded that consumer preference has shifted over the years in favor of clothes washers with agitators. (Id.) AHAM commented that manufacturers have introduced or reintroduced top-loading clothes washers with agitator technology due to increasing demand from consumers and from consumer complaints that there does not appear to be enough water in the wash load, and that clothes do not appear to be getting clean, in toploading clothes washers without agitators. (Id.) AHAM asserted that the efficiency levels DOE analyzed in the September 2021 Preliminary Analysis are likely to remove products from the market that are highly rated for consumer satisfaction and reliability, and recommended that DOE’s efficiency standards not lead to these products being removed from the market. (Id.) Whirlpool commented that consumers are increasingly demanding top-loading clothes washers with agitators, perhaps due in part to any negative experiences that consumers may have had with previous front-loading or top-loading clothes washers with a wash plate. (Whirlpool, No. 39 at p. 15) Whirlpool presented data showing that 72 percent of top-loading clothes washer shoppers are looking for a clothes washer with an agitator. (Id.) Whirlpool also presented data showing that top-loading clothes washers with wash plates once made up about 54 percent of all top-loading shipments, and that number has since declined to 34 percent. (Id.) Whirlpool commented that manufacturers have responded to this demand shift in large part by offering a broad assortment of agitator clothes washers. (Id.) Whirlpool noted that two major competitors to Whirlpool have recently introduced their first ever top-loading agitator models over the past few years. (Id.) Whirlpool asserted that any amended standards from DOE that would VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 preclude manufacturers from being able to offer top-loading clothes washers with agitators would be problematic for their consumers. (Id.) Whirlpool expressed concern that if the top-loading standard level were amended to EL 2 or above, agitators would be phased out from the U.S. market and would be replaced by wash plates. (Whirlpool, No. 39 at pp. 3–4) Whirlpool recommended that DOE consider not amending the top-loading clothes washer standards, which would allow traditional agitator clothes washers to stay on the market. (Whirlpool, No. 39 at p. 20) Whirlpool described the two different types of agitators used in clothes washers today: traditional agitators that have an internal mechanism driving the barrel of the agitator in a single direction, and high-efficiency agitators that have the barrel of the agitator fixed to or molded as part of the wash plate. (Id.) Whirlpool further explained that traditional agitators operate in deeper water, and the motion of the agitator generates the flow of clothing within the wash bath; whereas high-efficiency agitators use less water and rely on fabric-to-fabric shear to move the clothing within the drum. (Id.) Whirlpool commented that consumers may notice that high-efficiency agitator clothes washers use less water or require a longer cycle time than traditional agitator clothes washers. (Id.) Whirlpool asserted that many consumers have used traditional agitator clothes washers for their entire lives and may not readily accept the performance, water level, and wash motion differences between agitator and nonagitator models. (Id.) As discussed further in section V.C.1 of this document, DOE is proposing to adopt an amended standard for toploading, standard-size clothes washers that corresponds to the CEE Tier 1 level. DOE’s market analysis indicates that top loading models currently on the market at TSL 4 use wash plates (i.e., do not have agitators). DOE is aware of toploading clothes washers without an agitator that achieve equal or better cleaning performance than top-loading clothes washers with a traditional-style agitator in third-party performance reviews. According to Consumer Reports, among 40 tested RCW models with a traditional-style agitator, 4 models (10 percent) receive a relative ‘‘washing performance’’ rating of 5 out of 5, and 13 models (33 percent) receive a relative rating of 4 out of 5—for a total of 43 percent of units receiving a score of 4 or 5 out of 5. Among 36 tested models with a high-efficiency wash plate design, 11 models (30 percent) PO 00000 Frm 00084 Fmt 4701 Sfmt 4702 receive a relative rating of 5 out of 5, and 14 models (39 percent) receive a relative rating of 4 out of 5—for a total of 69 percent of units receiving a score of 4 or 5 out of 5. These ratings indicate that clothes washers with highefficiency wash plate designs can achieve equal or better overall cleaning performance scores than clothes washers with traditional-style agitators. As discussed, DOE recognizes that the Consumer Reports cleaning performance test method is inconsistent with the test conditions prescribed by DOE’s appendix J test procedure and that products with superior cleaning performance ratings may sacrifice or trade off with one or more other aspects of consumer-relevant performance. DOE seeks comment on any aspects of cleaning performance that provide differentiation between the use of an agitator or a wash plate that are not reflected in the Consumer Reports washing performance ratings evaluated in this NOPR. DOE seeks comment on whether any lessening of the utility or performance of top-loading standard-size RCWs, in accordance with 42 U.S.C. 6295(o)(2)(B)(i)(IV), would result from a potential standard that would preclude the use of a traditional agitator. In particular, DOE seeks information and data on how such utility or performance would be measured or evaluated. c. Water Levels Each higher efficiency level considered by DOE corresponds to a higher WER value compared to the baseline level. Higher WER values are achieved through the use of less water during the cycle, which generally achieved through lower water levels during the wash and/or rinse portions of the cycle. Whirlpool expressed concern that decreasing water levels and wash temperatures would negatively impact consumer perceptions that their clothes washers are working correctly. (Whirlpool, No. 39 at pp. 12–14) Whirlpool stated that across all manufacturers and brands, it saw customer sentiment scores for water level and wash temperatures were net positive for clothes washers that were rated at 6.5 IWF (the current DOE baseline level for top-loading clothes washers), and that customer sentiment scores were net negative for clothes washers rated at 4.3 IWF (the ENERGY STAR Most Efficient level for standardsize clothes washers). (Id.) Whirlpool added that decreasing water usage, and therefore increasing detergent concentration, does not correlate to improved consumer satisfaction. (Id.) E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules Whirlpool commented that it received consumer complaints about water levels being too low and not completely covering their clothes, and predicted that consumer complaints would increase with any amended standards that would drive a further decrease in water levels. (Id.) Whirlpool added that lowering water levels in order to meet amended standards may leave its clothes washers without enough free water to support the degree of load motion needed to maintain consumer satisfaction. (Id.) Whirlpool further stated that consumers strongly demand flexibility in water level. (Whirlpool, No. 39 at p. 15) Whirlpool commented that manufacturers have responded to this demand for flexibility by offering deep fill and deep-water wash options on toploading clothes washers. (Id.) Whirlpool commented that in the entire toploading clothes washer segment, Whirlpool is only aware of three models that do not have deep fill options. (Id.) Whirlpool expressed concern that amended standards could erode Whirlpool’s ability to offer consumers this flexibility. (Id.) Whirlpool commented that manufacturers have taken several actions during and since the last updates to DOE and ENERGY STAR standards to communicate, educate, and set appropriate consumer expectations for performance. (Whirlpool, No. 39 at pp. 14–16) For example, Whirlpool explained that on its websites, it has created a page that describes the various differences between clothes washers with agitators versus clothes washers with wash plates that details how both types of clothes washers work to clean clothes, the differences in water levels between these types of clothes washers, the benefits of each type of clothes washer, and how to find the right type of clothes washer. (Id.) Whirlpool added that it also works to educate retail associates about these fundamental differences between clothes washers to communicate this information to consumers and answer any questions they may have while shopping. (Id.) Whirlpool commented that despite manufacturers’ collective efforts to educate consumers about efficient clothes washers and how they perform, consumers may still not accept new clothes washers that use less energy and water. (Id.) Whirlpool stated that higher levels of torque are needed to move clothes in top-loading clothes washers with lower water levels, which creates more resistance when trying to move clothes around during the wash phase. (Whirlpool, No. 39 at p. 8) Whirlpool VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 commented that increased resistance and torque create higher levels of stress on many components, cause components to wear out more quickly, and lead to hotter motor temperatures, which requires increased dwell period for cooling. (Id.) Whirlpool suggested that DOE capture the cost and product changes necessitated by the additional torque needed to move clothes in a wash basket with lower wash levels. (Id.) Whirlpool commented that it would expect a rebound effect to occur for clothes washers as a result of amended standards. Whirlpool commented that consumers who are dissatisfied with the water level in the DOE-tested cycle will likely take some sort of action to compensate, including adding their own water to the cycle or choosing to largely or exclusively use deep fill and deep water wash options on their clothes washer. Whirlpool added that if consumers are dissatisfied with cleaning and rinse performance, they may decide to wash smaller loads (thereby increasing the number of annual cycles), use warmer wash temperatures, pretreat clothes or use options such as second rinse and pre-soak, or wash a load multiple times. (Whirlpool, No. 39 at pp. 17–18) GEA commented that based on its consumer preference data, consumers expressed a strong preference for control over the amount of water used in their clothes washers. (GEA, No. 38 at p. 2) GEA found that typically, consumers prefer to add more water to their wash load. (Id.) AHAM commented that manufacturers have experienced consumer pushback as a result of reducing water use. (AHAM, No. 40 at p. 11) AHAM noted that, while consumers typically use the normal cycle, most top-loading clothes washers include a deep fill option in order to address consumer interest in the ability to increase water levels. (Id.) AHAM added that as a result of reduced water use, consumers tend to rely on deep-fill settings, or add water to their clothes washers themselves. (Id.) AHAM commented that a significant portion of consumers dislike clothes washers with low water levels. (Id.) AHAM commented that the effects of strict water requirements may lead to consumer perceptions of inadequate cleaning performance, and will likely cause consumers to take actions that cause efficiency performance to diverge from DOE’s projections. AHAM added that this could amount to a negative ‘‘rebound effect,’’ where higher efficiency requirements lead to increased energy and water use due to consumers responding to inadequate PO 00000 Frm 00085 Fmt 4701 Sfmt 4702 13603 performance at stringent efficiency levels. (AHAM, No. 40 at p. 10) AHAM noted that, while consumers typically use the normal cycle, most top-loading clothes washers include a deep fill option in order to address consumer interest in the ability to increase water levels. As discussed, DOE has considered potential impacts to the various attributes of product performance as part of its consideration of amended standards, as discussed further in section V.C.1 of this document. To the extent that water levels correlate with cleaning and rinsing performance or other relevant attributes of clothes washer performance, DOE has considered such impacts as part of its analysis. DOE requests comment and information on sales of RCWs with deep fill and/or deep rinse options or settings and the frequency of use of cycles with these options or settings selected. d. Availability of Portable Products As discussed, top-loading portable RCWs are generally mounted on caster wheels, which allows the clothes washer to be moved more easily. AHAM commented that the proposed energy conservation standards could impact portable clothes washers and cause features of portability and lower price points to be lost. (AHAM, No. 40 at p. 16) AHAM added that the loss of low priced and portable top-loading clothes washers would raise equity concerns. (Id.) DOE’s testing and analysis of toploading standard-size portable units indicates that such products would be able to achieve the proposed standard level for the top-loading standard-size product class with only small changes to the final spin portion of the cycle (e.g., to implement ‘‘consistent spin’’) and a minor reduction in water use. Accordingly, DOE tentatively determines that the proposed standard level would not preclude the availability of portable clothes washers from the market. e. Conclusion For the reasons discussed in the previous sections, DOE has tentatively concluded that the standards proposed in this NOPR would not lessen the utility or performance of the RCWs under consideration in this proposed rulemaking. 5. Impact of Any Lessening of Competition DOE considered any lessening of competition that would be likely to result from new or amended standards. E:\FR\FM\03MRP2.SGM 03MRP2 13604 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules As discussed in section III.F.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-newstandards case, for the TSLs that DOE considered in this proposed rulemaking. Energy conservation resulting from potential energy conservation standards for RCWs is expected to yield environmental benefits in the form of reduced emissions of certain air pollutants and greenhouse gases. Table V.29 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.29—CUMULATIVE EMISSIONS REDUCTION FOR RESIDENTIAL CLOTHES WASHERS SHIPPED IN 2027–2056 Trial standard level 1 2 3 4 5 Power Sector Emissions CO2 (million metric tons) ..................................................... CH4 (thousand tons) ............................................................ N2O (thousand tons) ............................................................ NOX (thousand tons) ........................................................... SO2 (thousand tons) ............................................................ Hg (tons) .............................................................................. 20.4 1.5 0.2 11.4 8.8 0.1 20.6 1.5 0.2 11.5 8.9 0.1 24.2 1.8 0.2 13.2 10.8 0.1 49.0 3.4 0.5 28.3 19.7 0.1 79.3 4.9 0.7 48.8 28.1 0.2 1.7 163.4 0.0 25.7 0.1 0.0 1.9 186.6 0.0 29.5 0.1 0.0 4.2 408.1 0.0 64.1 0.2 0.0 7.3 713.3 0.0 111.4 0.3 0.0 22.3 164.9 0.2 37.2 9.0 0.1 26.1 188.4 0.3 42.7 10.9 0.1 53.2 411.4 0.5 92.4 199.9 0.1 86.6 718.3 0.7 160.2 28.5 0.2 Upstream Emissions CO2 (million metric tons) ..................................................... CH4 (thousand tons) ............................................................ N2O (thousand tons) ............................................................ NOX (thousand tons) ........................................................... SO2 (thousand tons) ............................................................ Hg (tons) .............................................................................. 1.7 161.9 0.0 25.5 0.1 0.0 Total FFC Emissions CO2 (million metric tons) ..................................................... CH4 (thousand tons) ............................................................ N2O (thousand tons) ............................................................ NOX (thousand tons) ........................................................... SO2 (thousand tons) ............................................................ Hg (tons) .............................................................................. ddrumheller on DSK120RN23PROD with PROPOSALS2 As part of the analysis for this proposed rulemaking, DOE estimated monetary benefits likely to result from the reduced emissions of CO2 that DOE estimated for each of the considered VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 22.1 163.4 0.2 36.9 8.9 0.1 TSLs for RCWs. Section IV.L of this document discusses the SC–CO2 values that DOE used. Table V.30 presents the value of CO2 emissions reduction at each TSL for each of the SC–CO2 cases. PO 00000 Frm 00086 Fmt 4701 Sfmt 4702 The time-series of annual values is presented for the proposed TSL in chapter 14 of the NOPR TSD. E:\FR\FM\03MRP2.SGM 03MRP2 13605 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules TABLE V.30—PRESENT VALUE OF CO2 EMISSIONS REDUCTION FOR RESIDENTIAL CLOTHES WASHERS SHIPPED IN 2027– 2056 SC–CO2 case Discount rate and statistics TSL 5% 3% 2.5% 3% Average Average Average 95th percentile (billion 2021$) 1 2 3 4 5 ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... As discussed in section IV.L.2 of this document, DOE estimated the climate benefits likely to result from the reduced emissions of methane and N2O that DOE estimated for each of the 219 221 258 509 812 considered TSLs for RCWs. Table V.31 presents the value of the CH4 emissions reduction at each TSL, and Table V.32 presents the value of the N2O emissions reduction at each TSL. The time-series 924 933 1,088 2,174 3,496 1,437 1,451 1,694 3,394 5,470 2,814 2,841 3,313 6,613 10,628 of annual values is presented for the proposed TSL in chapter 14 of the NOPR TSD. TABLE V.31—PRESENT VALUE OF METHANE EMISSIONS REDUCTION FOR RESIDENTIAL CLOTHES WASHERS SHIPPED IN 2027–2056 SC–CH4 case Discount rate and statistics TSL 5% 3% 2.5% 3% Average Average Average 95th percentile (billion 2021$) 1 2 3 4 5 ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... 74 74 84 179 307 214 216 246 530 917 297 299 341 738 1,280 567 572 652 1,403 2,428 TABLE V.32—PRESENT VALUE OF NITROUS OXIDE EMISSIONS REDUCTION FOR RESIDENTIAL CLOTHES WASHERS SHIPPED IN 2027–2056 SC–N2O Case Discount rate and statistics TSL 5% 3% 2.5% 3% Average Average Average 95th percentile (billion 2021$) ddrumheller on DSK120RN23PROD with PROPOSALS2 1 2 3 4 5 ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... ....................................................................................................................... DOE is well aware that scientific and economic knowledge about the VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 0.80 0.80 0.96 1.76 2.56 contribution of CO2 and other GHG emissions to changes in the future PO 00000 Frm 00087 Fmt 4701 Sfmt 4702 3.11 3.14 3.77 6.97 10.22 4.79 4.84 5.81 10.78 15.84 8.28 8.36 10.02 18.56 27.21 global climate and the potential resulting damages to the global and U.S. economy continues to evolve rapidly. DOE, together with other Federal E:\FR\FM\03MRP2.SGM 03MRP2 13606 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules agencies, will continue to review 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 health benefits associated with NOX and SO2 emissions reductions anticipated to result from the considered TSLs for RCWs. The dollarper-ton values that DOE used are discussed in section IV.L of this document. Table V.33 presents the present value for NOX emissions reduction for each TSL calculated using 7-percent and 3-percent discount rates, and Table V.34 presents similar results for SO2 emissions reductions. The results in these tables reflect application of EPA’s low dollar-per-ton values, which DOE used to be conservative. The time-series of annual values is presented for the proposed TSL in chapter 14 of the NOPR TSD. TABLE V.33—PRESENT VALUE OF NOX EMISSIONS REDUCTION FOR RESIDENTIAL CLOTHES WASHERS SHIPPED IN 2027– 2056 3% Discount rate TSL 7% Discount rate (million 2021$) 1 2 3 4 5 ............................................................................................................................................................................... ............................................................................................................................................................................... ............................................................................................................................................................................... ............................................................................................................................................................................... ............................................................................................................................................................................... 1,467 1,481 1,712 3,468 5,684 634 641 739 1,441 2,304 TABLE V.34—PRESENT VALUE OF SO2 EMISSIONS REDUCTION FOR RESIDENTIAL CLOTHES WASHERS SHIPPED IN 2027– 2056 3% Discount rate TSL 7% Discount rate (million 2021$) 1 2 3 4 5 ............................................................................................................................................................................... ............................................................................................................................................................................... ............................................................................................................................................................................... ............................................................................................................................................................................... ............................................................................................................................................................................... DOE has not considered the monetary benefits of the reduction of Hg for this proposed rule. Not all the public health and environmental benefits from the reduction of greenhouse gases, NOx, and SO2 are captured in the previous values, and additional unquantified benefits from the reductions of those pollutants as well as from the reduction of Hg, direct PM, and other copollutants may be significant. 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.35 presents the NPV values that result from adding the estimates of the potential economic benefits resulting from reduced GHG, NOX, and 505 510 615 1,098 1,540 225 227 272 472 650 SO2 emissions to the NPV of consumer benefits calculated for each TSL considered in this proposed rulemaking. The consumer benefits are domestic U.S. monetary savings that occur as a result of purchasing the covered products, 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 RCWs shipped in 2027–2056. TABLE V.35—CONSUMER NPV COMBINED WITH PRESENT VALUE OF CLIMATE BENEFITS AND HEALTH BENEFITS Category TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 ddrumheller on DSK120RN23PROD with PROPOSALS2 Using 3% discount rate for Consumer NPV and Health Benefits (billion 2021$) 5% Average SC–GHG case ................................................ 3% Average SC–GHG case ................................................ 2.5% Average SC–GHG case ............................................. 3% 95th percentile SC–GHG case ...................................... 10.7 11.5 12.1 13.7 10.8 11.6 12.2 13.9 10.8 11.8 12.5 14.4 19.8 21.8 23.2 27.1 29.1 32.4 34.8 41.1 7.7 9.8 11.8 15.1 Using 7% discount rate for Consumer NPV and Health Benefits (billion 2021$) 5% Average SC–GHG case ................................................ 3% Average SC–GHG case ................................................ VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 PO 00000 Frm 00088 4.5 5.4 Fmt 4701 Sfmt 4702 4.6 5.4 E:\FR\FM\03MRP2.SGM 3.8 4.8 03MRP2 13607 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules TABLE V.35—CONSUMER NPV COMBINED WITH PRESENT VALUE OF CLIMATE BENEFITS AND HEALTH BENEFITS— Continued Category TSL 1 2.5% Average SC–GHG case ............................................. 3% 95th percentile SC–GHG case ...................................... 6.0 7.6 TSL 3 6.0 7.7 TSL 4 5.5 7.5 TSL 5 11.2 15.1 17.4 23.7 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 RCWs 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 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 forego 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.131 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.132 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. 131 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. 132 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 June 12, 2022). C. Conclusion ddrumheller on DSK120RN23PROD with PROPOSALS2 TSL 2 VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 PO 00000 Frm 00089 Fmt 4701 Sfmt 4702 1. Benefits and Burdens of TSLs Considered for Residential Clothes Washer Standards Table V.36 and Table V.37 summarize the quantitative impacts estimated for each TSL for RCWs. The national impacts are measured over the lifetime of RCWs 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. E:\FR\FM\03MRP2.SGM 03MRP2 13608 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules TABLE V.36—SUMMARY OF ANALYTICAL RESULTS FOR RESIDENTIAL CLOTHES WASHER TSLS: NATIONAL IMPACTS Category TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 Cumulative FFC National Energy Savings Quads ................................................................................... 0.61 0.62 0.74 1.45 2.27 26.13 188.43 0.26 42.73 10.88 0.07 53.21 411.43 0.48 92.39 19.93 0.13 86.62 718.26 0.71 160.21 28.45 0.18 27.83 2.71 4.57 35.11 13.31 14.52 21.80 35.68 4.42 7.22 47.32 14.91 20.77 32.41 12.73 2.71 1.91 17.35 7.58 5.14 9.77 16.12 4.42 2.95 23.50 8.45 7.68 15.05 Cumulative FFC Emissions Reduction CO2 (million metric tons) ..................................................... CH4 (thousand tons) ............................................................ N2O (thousand tons) ............................................................ NOX (thousand tons) ........................................................... SO2 (thousand tons) ............................................................ Hg (tons) .............................................................................. 22.11 163.41 0.21 36.90 8.88 0.06 22.32 164.89 0.21 37.24 8.96 0.06 Present Value of Benefits and Costs (3% discount rate, billion 2021$) Consumer Operating Cost Savings ..................................... Climate Benefits * ................................................................. Health Benefits ** ................................................................. Total Benefits † .................................................................... Consumer Incremental Product Costs ‡ .............................. Consumer Net Benefits ........................................................ Total Net Benefits ................................................................ 13.46 1.14 1.97 16.57 5.07 8.39 11.50 13.60 1.15 1.99 16.74 5.10 8.50 11.64 19.88 1.34 2.33 23.54 11.75 8.13 11.79 Present Value of Benefits and Costs (7% discount rate, billion 2021$) Consumer Operating Cost Savings ..................................... Climate Benefits * ................................................................. Health Benefits ** ................................................................. Total Benefits † .................................................................... Consumer Incremental Product Costs ‡ .............................. Consumer Net Benefits ........................................................ Total Net Benefits ................................................................ 6.36 1.14 0.86 8.36 3.00 3.36 5.36 6.43 1.15 0.87 8.45 3.02 3.41 5.43 9.20 1.34 1.01 11.55 6.72 2.48 4.83 Note: This table presents the costs and benefits associated with RCWs 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 SC–CO2, SC–CH4, and SC–N2O. Together these represent the global 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. 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 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 consumer, climate, and health benefits. 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 sets of SC–GHG estimates. ‡ Costs include incremental equipment costs as well as installation costs. TABLE V.37—SUMMARY OF ANALYTICAL RESULTS FOR RESIDENTIAL CLOTHES WASHER TSLS: MANUFACTURER AND CONSUMER IMPACTS Category TSL 1 * TSL 2 * TSL 3 * TSL 4 * TSL 5 * ddrumheller on DSK120RN23PROD with PROPOSALS2 Manufacturer Impacts Industry NPV (million 2021$) (No-new-standards case INPV = 1,738). Industry NPV (% change) ** ....... 1,680.4 to 1,746.4 .. 1,636.5 to 1,702.9 .. 1,490.3 to 1,631.0 .. 1,208.1 to 1,376.7 .. 798.7 to 985.9. (3.3) to 0.5 .............. (5.9) to (2.0) ............ (14.3) to (6.2) .......... (30.5) to (20.8) ........ (54.1) to (43.3). $329 ........................ n.a. .......................... $134 ........................ $7 ............................ $19 .......................... $219. n.a. $157. $56. $55. Consumer Average LCC Savings (2021$) Semi-Automatic .......................... Top-Loading, Ultra-Compact ...... Top-Loading, Standard-Size ...... Front-Loading, Compact ............ Front-Loading, Standard-Size .... VerDate Sep<11>2014 21:12 Mar 02, 2023 $329 ........................ n.a. .......................... $138 ........................ $0 ............................ $57 .......................... Jkt 259001 PO 00000 $329 ........................ n.a. .......................... $138 ........................ $0 ............................ $78 .......................... Frm 00090 Fmt 4701 $329 ........................ n.a. .......................... $115 ........................ $0 ............................ $78 .......................... Sfmt 4702 E:\FR\FM\03MRP2.SGM 03MRP2 13609 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules TABLE V.37—SUMMARY OF ANALYTICAL RESULTS FOR RESIDENTIAL CLOTHES WASHER TSLS: MANUFACTURER AND CONSUMER IMPACTS—Continued Category TSL 1 * TSL 2 * TSL 3 * TSL 4 * TSL 5 * Shipment-Weighted Average * ... $119 ........................ $124 ........................ $107 ........................ $107 ........................ $132. 0.3 ........................... n.a. .......................... 5.9 ........................... 9.1 ........................... 3.2 ........................... 5.2 ........................... 0.4. n.a. 5.5. 7.1. 3.4. 4.9. 0% ........................... n.a. .......................... 25% ......................... 24% ......................... 24% ......................... 24% ......................... 0%. n.a. 23%. 29%. 18%. 21%. Consumer Simple PBP (years) Semi-Automatic .......................... Top-Loading, Ultra-Compact ...... Top-Loading, Standard-Size ...... Front-Loading, Compact ............ Front-Loading, Standard-Size .... Shipment-Weighted Average * ... 0.3 ........................... n.a. .......................... 4.6 ........................... 0.0 ........................... 2.8 ........................... 4.0 ........................... 0.3 ........................... n.a. .......................... 4.6 ........................... 0.0 ........................... 2.4 ........................... 3.9 ........................... 0.3 ........................... n.a. .......................... 6.8 ........................... 0.0 ........................... 2.4 ........................... 5.5 ........................... Percent of Consumers that Experience a Net Cost Semi-Automatic .......................... Top-Loading, Ultra-Compact ...... Top-Loading, Standard-Size ...... Front-Loading, Compact ............ Front-Loading, Standard-Size .... Shipment-Weighted Average * ... 0% ........................... n.a. .......................... 14% ......................... 0% ........................... 0% ........................... 11% ......................... 0% ........................... n.a. .......................... 14% ......................... 0% ........................... 0% ........................... 11% ......................... 0% ........................... n.a. .......................... 28% ......................... 0% ........................... 0% ........................... 20% ......................... ddrumheller on DSK120RN23PROD with PROPOSALS2 The entry ‘‘n.a.’’ means not applicable because there is no change in the standard at certain TSLs. * Weighted by shares of each product class in total projected shipments in 2027. ** Parentheses indicate negative (¥) values. 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)) 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)(I)–(VII)) For this NOPR, DOE considered the impacts of amended standards for RCWs 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. Samsung commented that top-loading standard-size clothes washers, which cover roughly 70 percent of the marketplace, offer the greatest efficiency improvement opportunity and should be set to EL 3, which is included in TSL 4. (Samsung, No. 41 at pp. 2–3) Samsung added that DOE’s analysis demonstrates a practical payback period of 4.2 years for top-loading standardsize RCWs, and DOE’s engineering analysis shows that slight adjustments to wash temperature, spray rinse, and changing to a direct drive motor can VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 contribute to a significant National Energy Savings of 1.85 quads. (Id.) Samsung added that direct drive motor and inverter control technology have matured over the years and have become highly cost competitive. (Id.) Samsung commented that it predicts these technologies will commonly be used in the near term given the benefits to energy efficiency, quiet operation, and high reliability. (Id.) Samsung noted that increasing efficiency for top-loading standard-size clothes washers becomes especially important if DOE’s consumer choice model indicates that the toploading market share will increase with increased minimum energy performance standards on top-loading standard-size clothes washers. (Id.) Samsung recommended that to realize savings for front-loading standard-size clothes washers, DOE should adopt EL 2, which is included in TSL 2 and TSL 3. (Samsung, No. 41 at p. 3) Samsung commented that when comparing the models listed in DOE’s CCD and those listed in EPA’s Qualified Products List, 78 percent of front-loading standard-size models meet EL 2 proposed in the September 2021 Preliminary TSD. (Id.) Samsung noted that increasing the MEPS beyond EL 2 provides diminishing returns in the form of a longer payback period. (Id.) Samsung commented that going forward, if DOE expects consumers to adopt top-loading clothes washers, improvement in National Energy Savings for frontloading clothes washers becomes negligible as efficiency level increases. (Id.) PO 00000 Frm 00091 Fmt 4701 Sfmt 4702 As discussed, DOE evaluated each TSL, beginning with the maximum technologically feasible level, to determine the highest efficiency level that is both technologically feasible and economically justified and saves a significant amount of energy. The following paragraphs summarize the results of this evaluation. In particular, the summary discussion emphasizes the impacts on the top-loading standardsize and front-loading standard-size product classes, which together represent 96 percent of the market, as presented in Table IV.34 of this document. DOE first considered TSL 5, which represents the max-tech efficiency levels for all product classes. Specifically for top-loading standard-size RCWs, DOE’s expected design path for TSL 5 (which represents EL 4 for this product class) incorporates the use of a stainless-steel basket, a direct drive motor, a wash plate, reduced hot and warm wash water temperatures compared to temperatures available on baseline units, an increased tub size compared to the baseline, and the fastest achievable spin speeds. In particular, the faster spin speeds and reduced hot and warm wash temperatures provide the improvement in efficiency at TSL 5 compared to TSL 4. For front-loading standard-size RCWs, DOE’s expected design path for TSL 5 (which represents EL 4 for this product class) incorporates the use of the most efficient available direct drive motor, the implementation of advanced sensors, and the fastest achievable spin speeds. In particular, the more efficient motor, faster spin E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 13610 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules speeds, and advanced sensors provide the improvement in efficiency at TSL 5 compared to TSL 4. TSL 5 would save an estimated 2.27 quads of energy and 2.94 trillion gallons of water, an amount DOE considers significant. Under TSL 5, the NPV of consumer benefit would be $7.68 billion using a discount rate of 7 percent, and $20.77 billion using a discount rate of 3 percent. The cumulative emissions reductions at TSL 5 are 86.62 Mt of CO2, 28.45 thousand tons of SO2, 160.21 thousand tons of NOX, 0.18 tons of Hg, 718.26 thousand tons of CH4, and 0.71 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 $4.42 billion. The estimated monetary value of the health benefits from reduced SO2 and NOX emissions at TSL 5 is $2.95 billion using a 7-percent discount rate and $7.22 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 5 is $15.05 billion. Using a 3-percent discount rate for all benefits and costs, the estimated total NPV at TSL 5 is $32.41 billion. The estimated total NPV is provided for additional information, however DOE primarily relies upon the NPV of consumer benefits when determining whether a proposed standard level is economically justified. At TSL 5, the average LCC impact is a savings of $219 for semi-automatic, $157 for top-loading standard-size, $56 for front-loading compact, and $55 for front-loading standard-size clothes washers. The simple payback period is 0.4 years for semi-automatic, 5.5 years for top-loading standard-size, 7.1 years for front-loading compact, and 3.4 years for front-loading standard-size clothes washers. The fraction of consumers experiencing a net LCC cost is 0 percent for semi-automatic, 23 percent for toploading standard-size, 29 percent for front-loading compact, and 18 percent for front-loading standard-size clothes washers. Notably, for the top-loading standard-size product class, which represents 73 percent of the market, TSL 5 would increase the first cost by $189, in comparison to an installed cost of $706 for baseline units. For the frontloading standard-size product class, which represents 23 percent of the market, TSL 5 would increase the first cost by $70, compared to an installed cost of $1,195 for baseline units. At TSL VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 5, the proposed standard for top-loading ultra-compact clothes washers is at the baseline, resulting in no LCC impact, no simple PBP, and no consumers experiencing a net LCC cost. At TSL 5, the projected change in INPV ranges from a decrease of $939.6 million to a decrease of $752.4 million, which correspond to a decrease of 54.1 percent and 43.3 percent, respectively. The loss in INPV is largely driven by industry conversion costs as manufacturers 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 $1,253.8 million at this TSL. Conversion costs at max-tech are significant, as nearly all existing RCW models would need to be redesigned to meet the required efficiencies. Currently, approximately 3 percent of RCW annual shipments meet the maxtech levels. For top-loading standardsize clothes washers, which account for 73 percent of annual shipments, less than 1 percent of current shipments meet this level. Of the nine OEMs offering top-loading standard-size products, one OEM offers models that meet the efficiencies required by TSL 5. The remaining eight OEMs would need to overhaul their existing platforms and make significant updates to their production facilities. Those manufacturers may need to incorporate increased tub capacities, wash plate designs, direct drive motors, reinforced wash baskets, robust suspension and balancing systems, and advanced sensors. These product changes require significant investment. In interviews, several manufacturers expressed concerns about their ability to meet existing market demand given the required scale of investment, redesign effort, and 3-year compliance timeline. Based upon the above considerations, the Secretary tentatively concludes that at TSL 5 for RCWs, the benefits of energy and water savings, positive NPV of consumer benefits, and emission reductions would be outweighed by the impacts on manufacturers, including the large potential reduction in INPV. DOE estimated the potential loss in INPV to be as high as 54 percent. The potential losses in INPV are primarily driven by large conversion costs that must be made ahead of the compliance date. At max-tech, manufacturers would need to make significant upfront investments to update nearly all product lines and manufacturing facilities. Manufacturers expressed concern that they would not be able to complete product and production line updates within the 3year conversion period. Additionally, PO 00000 Frm 00092 Fmt 4701 Sfmt 4702 when considering the estimated monetary value of emissions reductions—representing $4.42 billion in climate benefits (associated with the average SC–GHG at a 3-percent discount rate), and $7.22 billion (using a 3percent discount rate) or $2.95 billion (using a 7-percent discount rate) in health benefits—DOE maintains its tentative conclusion that the overall benefits would be outweighed by the impacts on manufacturers. Consequently, the Secretary has tentatively concluded that TSL 5 is not economically justified. DOE then considered TSL 4, which represents the ENERGY STAR Most Efficient level for the front-loading product classes, the CEE Tier 1 level for the top-loading standard-size product class, and a gap fill level for the semiautomatic product classes. Specifically, for top-loading standard-size RCWs, DOE’s expected design path for TSL 4 (which represents EL 3 for this product class) incorporates many of the same technologies and design strategies as described for TSL 5. At TSL 4, toploading standard-size units would incorporate a stainless-steel basket, a direct drive motor, and a wash plate, consistent with TSL 5. Models at TSL 4 would also incorporate reduced hot wash water temperatures compared to temperatures available at the baseline through TSL 3 levels, increased tub size compared to the baseline (although not as large as TSL 5), and faster spin speeds compared to the baseline (although not as fast as TSL 5). In particular, the faster spin speeds, reduced hot wash temperatures, and use of a wash plate provide the improvement in efficiency at TSL 4 compared to TSL 3. For front-loading standard-size RCWs, DOE’s expected design path for TSL 4 (which represents EL 3 for this product class) incorporates the use of the most efficient direct drive motor available and spin speeds that are faster than the baseline level but not as fast as at TSL 5. In particular, more efficient motor and faster spin speeds provide the improvement in efficiency at TSL 4 compared to TSL 3. TSL 4 would save an estimated 1.45 quads of energy and 2.53 trillion gallons of water, an amount DOE considers significant. Under TSL 4, the NPV of consumer benefit would be $5.14 billion using a discount rate of 7 percent, and $14.52 billion using a discount rate of 3 percent. The cumulative emissions reductions at TSL 4 are 53.21 Mt of CO2, 19.93 thousand tons of SO2, 92.39 thousand tons of NOX, 0.13 tons of Hg, 411.41 thousand tons of CH4, and 0.48 thousand tons of N2O. The estimated E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules 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 $2.71 billion. The estimated monetary value of the health benefits from reduced SO2 and NOX emissions at TSL 4 is $1.91 billion using a 7-percent discount rate and $4.57 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 4 is $9.77 billion. Using a 3-percent discount rate for all benefits and costs, the estimated total NPV at TSL 4 is $21.80 billion. The estimated total NPV is provided for additional information, however DOE primarily relies upon the NPV of consumer benefits when determining whether a proposed standard level is economically justified. At TSL 4, the average LCC impact is a savings of $329 for semi-automatic, $134 for top-loading standard-size, $7 for front-loading compact, and $19 for front-loading standard-size clothes washers. The simple payback period is 0.3 years for semi-automatic, 5.9 years for top-loading standard-size, 9.1 years for front-loading compact, and 3.2 years for front-loading standard-size clothes washers. The fraction of consumers experiencing a net LCC cost is 0 percent for semi-automatic, 25 percent for toploading standard-size, 24 percent for front-loading compact, and 24 percent for front-loading standard-size clothes washers. For the top-loading standardsize product class, TSL 4 would increase the first cost by $185, in comparison to an installed cost of $706 for baseline units. For the front-loading standard-size product class, TSL 4 would increase the first cost by $49, compared to an installed cost of $1,195 for baseline units. At TSL 4, the proposed standard for top-loading ultracompact clothes washers is at the baseline resulting in no LCC impact, no simple PBP, and no consumers experiencing a net LCC cost. Overall, across all product classes, around 24 percent of consumers would experience a net LCC cost at TSL 4. DOE estimated that about 14 percent of low-income households would experience a net LCC cost at TSL 4, and as a result of smaller households and lower annual usage, about 33 percent of senior-only households would experience a net LCC cost at TSL 4. At TSL 4, the projected change in INPV ranges from a decrease of $530.2 million to a decrease of $361.6 million, VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 which correspond to a decrease of 30.5 percent and 20.8 percent, respectively. The loss in INPV is largely driven by industry conversion costs as manufacturers work to redesign their portfolio of model offerings and update production facilities to comply with amended standards at this level. Industry conversion costs could reach $690.8 million at this TSL. At TSL 4, most top-loading standardsize products would need to be redesigned to meet these efficiencies; however, a substantial number of frontloading standard-size products are available on the market due to manufacturers’ participation in the ENERGY STAR Most Efficient program. Currently, approximately 14 percent of RCW shipments meet TSL 4 efficiencies, including nearly 46 percent of standardsize front-loading shipments. Of the seven OEMs with standard-size frontloading products, five OEMs offer 87 basic models (representing approximately 50 percent of all frontloading standard-size basic models) that meet TSL 4 efficiencies. For standardsize top-loading products, approximately two percent of shipments meet this level. Of the nine OEMs offering top-loading standard-size products, two OEMs offer around 20 basic models (representing approximately 4 percent of all toploading standard-size basic models) that meet the efficiencies required by TSL 4. At this level, the remaining seven manufacturers would likely implement largely similar design options as at TSL 5, but to a lesser extent for the increase in tub size and hardware changes associated with faster spin speeds (e.g., reinforced wash baskets, robust suspension and balancing systems, and advanced sensors)—which are faster than the baseline level but not as fast as TSL 5. In interviews, manufacturers indicated that meeting TSL 4 efficiencies would require a less extensive redesign than meeting TSL 5 efficiencies. At TSL 4, manufacturers expressed concerns—both through written comments as well as during confidential manufacturer interviews—regarding impacts to certain attributes of product performance, including wash temperatures, cleaning and rinsing performance, and fabric care, particularly for top-loading standardsize RCWs. As discussed in section V.B.4.a of this document, DOE recognizes that in general, a consumeracceptable level of cleaning performance (i.e., a representative average use cycle) can be easier to achieve through the use of higher amounts of energy and water use during PO 00000 Frm 00093 Fmt 4701 Sfmt 4702 13611 the clothes washer cycle. Conversely, maintaining acceptable cleaning performance can be more difficult as energy and water levels are reduced. Improving one aspect of clothes washer performance, such as reducing energy and/or water use as a result of energy conservation standards, may require manufacturers to make a trade-off with one or more other aspects of performance, such as cleaning performance, depending on which performance characteristics are prioritized by the manufacturer. DOE expects, however, that consumers maintain the same expectations of cleaning performance regardless of the efficiency of the clothes washer. Manufacturers did not provide any quantitative data to support the assertion that a standard level at TSL 4 would negatively impact product performance. As discussed in section V.B.4.a of this document, DOE’s analysis of third-party clothes washer performance reviews suggests that both top-loading and front-loading RCWs models rated at TSL 4 can achieve equal or better overall cleaning performance scores than models with lower efficiency ratings. DOE also conducted its own performance testing on a representative sample of top-loading standard-size and front-loading standard-size RCWs, the results of which suggest that TSL 4 can be achieved with key performance attributes (e.g., wash temperatures, stain removal, mechanical action, and cycle duration) that are largely comparable to the performance of lower-efficiency units available on the market today. In particular, DOE tentatively concludes that the proposed standard level at TSL 4: (1) would not require any substantive reduction in hot water temperature on the hottest temperature selection in the Normal cycle, and would not preclude the ability to provide wash temperatures above the 85 °F threshold at which fatty soils are soluble; (2) would be able to maintain total cleaning score of at least 90, the market-representative threshold as measured on the Hot temperature selection with the large load size; furthermore, by prioritizing hardware design options over reduced wash temperatures, the proposed standard level would not preclude the ability to provide total cleaning scores for toploading units equally as high as the highest scores currently achieved by units at lower efficiency levels; (3) would not preclude the ability to provide mechanical action scores comparable to the scores for units at lower efficiency levels; and (4) would not result in an increase in average cycle E:\FR\FM\03MRP2.SGM 03MRP2 13612 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules time as measured by the appendix J test procedure. In summary, based on DOE’s testing of models that currently meet the proposed standards, DOE does not expect performance to be compromised at the proposed standard level. Furthermore, products are readily available on the market at each efficiency level analyzed in the NOPR, including TSL 4, indicating a certain degree of market acceptance at each efficiency level. DOE requests data and information regarding any quantitative performancerelated characteristics at TSL 4 in comparison to performance at the current baseline level (e.g., cleaning performance, rinsing performance, fabric wear, etc.), particularly for toploading standard-size RCWs. As discussed, DOE’s clothes washer test procedure does not prescribe a method for testing clothes washer cleaning performance or other relevant attributes of RCW performance. DOE, in partnership with EPA, has developed the ENERGY STAR Test Method for Determining Residential Clothes Washer Cleaning Performance 133 to determine cleaning performance for clothes washers that meet the ENERGY STAR Most Efficient criteria. Cleaning performance is determined on the same test units immediately following the energy and water consumption tests for ENERGY STAR qualification. Notably, however, this test method is designed to be performed in conjunction with DOE’s appendix J2 test procedure—whereas the amended standards proposed by this NOPR would be based on testing conducted to the appendix J test procedure. Appendix J specifies different load sizes than appendix J2, among other changes, which can significantly affect any measurement of cleaning performance. Additional investigation would be required to develop a cleaning performance test procedure designed to be conducted in conjunction with appendix J. After considering the analysis and weighing the benefits and burdens, the Secretary has tentatively concluded that at a standard set at TSL 4 for RCWs would be economically justified. At this TSL, the weighted average LCC savings for all product classes is $107. An estimated 25 percent of top-loading standard-size clothes washer consumers and an estimated 24 percent of frontloading (compact and standard-size) clothes washer consumers would experience a net cost. DOE acknowledges the larger impact on senior-only households as a result of smaller households and lower average annual use, but notes that the average LCC savings are still positive. The FFC national energy and water savings are significant and the NPV of consumer benefits is positive using both a 3percent and 7-percent discount rate. Notably, the benefits to consumers, considering low-income and senior-only subgroups as well, vastly outweigh the cost to manufacturers. At TSL 4, the NPV of consumer benefits, even measured at the more conservative discount rate of 7 percent is over 27 times higher than the maximum estimated manufacturers’ loss in INPV. The standard levels at TSL 4 are economically justified even without weighing the estimated monetary value of emissions reductions. When those emissions reductions are included— representing $2.71 billion in climate benefits (associated with the average SC–GHG at a 3-percent discount rate), and $4.57 billion (using a 3-percent discount rate) or $1.91 billion (using a 7-percent discount rate) in health benefits—the rationale becomes stronger still. Therefore, based on the above considerations, DOE proposes to adopt the energy conservation standards for RCWs at TSL 4. The proposed amended energy conservation standards for RCWs, which are expressed in EER and WER, are shown in Table V.38. TABLE V.38—PROPOSED AMENDED ENERGY CONSERVATION STANDARDS FOR RESIDENTIAL CLOTHES WASHERS Minimum energy efficiency ratio (lb/kWh/cycle) Product class Semi-Automatic Clothes Washers ............................................................................................................... Automatic Clothes Washers: Top-Loading, Ultra-Compact (less than 1.6 ft3 capacity) ..................................................................... Top-Loading, Standard-Size (1.6 ft3 or greater capacity) .................................................................... Front-Loading, Compact (less than 3.0 ft3 capacity) ........................................................................... Front-Loading, Standard-Size (3.0 ft3 or greater capacity) .................................................................. 2.12 0.27 3.79 4.78 5.02 5.73 0.29 0.63 0.71 0.77 The benefits and costs of the proposed standards can also be expressed in terms of annualized values. The annualized net benefit is (1) the annualized national economic value (expressed in 2021$) 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 climate and health benefits from emission reductions. Table V.39 shows the annualized values for RCWs under TSL 4, expressed in 2021$. The 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 RCWs is $800.8 million per year in increased equipment costs, while the estimated annual benefits are $1,344.2 million from reduced equipment operating costs, $155.7 million from GHG reductions, and $202.0 million from reduced NOX and SO2 emissions. In this case, the net benefit amounts to $901.1 million per year. Using a 3-percent discount rate for all benefits and costs, the estimated cost of the proposed standards for RCWs is $764.0 million per year in increased equipment costs, while the estimated annual benefits are $1,598.0 million from reduced equipment operating costs, $155.7 million from GHG reductions, and $262.2 million from reduced NOX and SO2 emissions. In this case, the net benefit amounts to $1,251.8 million per year. 133 ENERGY STAR test method available at www.energystar.gov/sites/default/files/asset/ document/Test%20Method%20for% 20Determining%20Residential%20 Clothes%20Washer%20Cleaning%20 Performance%20-%20July%202018_0.pdf. 2. Annualized Benefits and Costs of the Proposed Standards ddrumheller on DSK120RN23PROD with PROPOSALS2 Minimum water efficiency ratio (lb/gal/cycle) VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 PO 00000 Frm 00094 Fmt 4701 Sfmt 4702 E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules 13613 TABLE V.39—ANNUALIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR RESIDENTIAL CLOTHES WASHERS [TSL 4] Million 2021$/year Primary estimate Low-net-benefits estimate High-net-benefits estimate 3% discount rate Consumer Operating Cost Savings ............................................................................. Climate Benefits * ......................................................................................................... Health Benefits ** ......................................................................................................... 1,598.0 155.7 262.2 1,544.5 151.7 255.8 1,657.8 159.7 268.9 Total Benefits † ..................................................................................................... Consumer Incremental Product Costs ‡ ...................................................................... 2,015.9 764.0 1,952.0 778.7 2,086.4 695.5 Net Benefits .......................................................................................................... 1,251.8 1,173.4 1,390.9 Consumer Operating Cost Savings ............................................................................. Climate Benefits * (3% discount rate) .......................................................................... Health Benefits ** ......................................................................................................... 1,344.2 155.7 202.0 1,302.8 151.7 197.5 1,389.7 159.7 206.7 Total Benefits † ..................................................................................................... Consumer Incremental Product Costs ‡ ...................................................................... 1,701.9 800.8 1,652.0 813.3 1,756.1 737.9 Net Benefits .......................................................................................................... 901.1 838.7 1,018.3 7% discount rate Note: This table presents the costs and benefits associated with RCWs shipped in 2027–2056. These results include benefits to consumers which accrue after 2056 from the products shipped in 2027–2056. The Primary, Low Net Benefits, and High Net Benefits Estimates utilize projections of energy prices from the AEO2022 Reference case, Low Economic Growth case, and High Economic Growth case, respectively. In addition, incremental equipment costs reflect a medium decline rate in the Primary Estimate, a low decline rate in the Low Net Benefits Estimate, and a high decline rate in the High Net Benefits Estimate. The methods used to derive projected price trends are explained in sections IV.F.1 and IV.H.3 of this document. Note that the Benefits and Costs may not sum to the Net Benefits due to rounding. * 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 sets of 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 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. See section IV.L of this document for more details. † Total benefits include 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. ‡ Costs include incremental equipment costs as well as installation costs. ddrumheller on DSK120RN23PROD with PROPOSALS2 D. Reporting, Certification, and Sampling Plan Manufacturers, including importers, must use product-specific certification templates to certify compliance to DOE. For RCWs, the certification template reflects the general certification requirements specified at 10 CFR 429.12 and the product-specific requirements specified at 10 CFR 429.20. Ameren et al. encouraged DOE to require manufacturers to report average cycle time in the CCD. (Ameren et al., No. 42 at pp. 10–12) Ameren et al. commented that reporting average cycle time increases stakeholder and consumer access to cycle time, which Ameren et al. identify as an important RCW performance attribute. (Id.) Ameren et al. commented that cycle VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 time information is important for some consumers, particularly for RCW consumers who routinely wash serial loads. (Id.) Ameren et al. added that making cycle time widely available enables stakeholders to better evaluate the cycle time of a given clothes washer relative to its performance level, which could be even more important with possible increases to standards that may drive increases in spin times to decrease drying energy. (Id.) Ameren et al. also commented that reporting RCW cycle time increases the transparency of the energy efficiency metrics since reporting additional information on cycle time helps improve the transparency of how the energy efficiency metric is derived for a given clothes washer. (Id.) Ameren et al. added that this is especially PO 00000 Frm 00095 Fmt 4701 Sfmt 4702 important considering the wide variation in the cycle time of top- and front-loading RCWs. (Id.) Ameren et al. further commented that reporting RCW cycle time enables continuous improvement of the test procedure and energy conservation standard over time. (Id.) Ameren et al. specified that having access to additional data on cycle time enables DOE and other stakeholder groups to consider more effectively the value of cycle time measurement as a performance feature in future rulemakings. (Id.) Ameren et al. presented data from NEEA that plotted cycle time versus rated IMEF of 18 toploading and front-loading RCWs. (Id.) Ameren et al. found that cycle time varies widely across front-loading and top-loading standard-size product E:\FR\FM\03MRP2.SGM 03MRP2 13614 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules ddrumheller on DSK120RN23PROD with PROPOSALS2 classes. (Id.) Ameren et al. added that according to NEEA’s testing 134 some RCWs with identical IMEF ratings can have cycle times that are twice as long as other models. (Id.) Ameren et al. therefore concluded that these cycle times will also vary in laboratory testing (with the appendix J2 textiles) and that this variation represents real-world cycle time differences. (Id.) The CA IOUs recommended that DOE consider disclosing other configurations such as stacked clothes washers and clothes dryers in the CCD. (CA IOUs, No. 43 at p. 6) The CA IOUs commented that there are several clothes washer configurations available on the market which might offer unique functionality to some consumers while not warranting a separate product class. (Id.) For example, the CA IOUs listed combination all-in-one washer-dryers, pedestal type clothes washers, laundry centers,135 and double clothes washer products,136 and stated that all represent unique product configurations that are not differentiated in the CCD. (Id.) The CA IOUs commented that, while these configurations are clear and intuitive to consumers and retailers, the public does not have access to a reliable database denoting these unique product characterizations. (Id.) The CA IOUs commented that considering the increasing market share and marketing of these products, they encourage DOE to consider the disclosure of these product configurations into certification requirements and adding those attributes to the CCD. (Id.) In response to Ameren et al. and the CA IOUs, the values for which DOE currently requires reporting for RCWs are product characteristics that are required in order for DOE to determine whether the product is in compliance with the applicable standards. For example, currently reported values include characteristics that determine product class (e.g., loading axis, capacity), measured characteristics on which a standard depends (e.g., IMEF, EER), and characteristics necessary for enforcement of standards (e.g., RMC). At this time, DOE tentatively concludes that cycle time and product configuration (as recommend by commenters) are not required to 134 NEEA’s testing was conducted using an 8.45 lb load of AHAM cotton textiles, using the Normal Cycle on Warm Wash/Cold Rinse with default spin settings. Ameren et al. noted that NEEA’s analysis confirms that the cycle times of cycles run with appendix J2 textiles and AHAM cotton textiles are nearly identical. 135 A laundry center is a single tall unit which contains both a clothes washer and a clothes dryer. 136 The CA IOUs reference products with two integrated clothes washer drums, such as the Samsung FlexWashTM as ‘‘double clothes washers.’’ VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 determine compliance with the applicable standard. In this NOPR, DOE is not proposing to amend the productspecific certification requirements for RCWs. DOE would consider any amendments to the reported values for RCWs in a separate rulemaking. 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’’) in the OMB 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 OIRA for review. OIRA has determined that this proposed regulatory action constitutes a PO 00000 Frm 00096 Fmt 4701 Sfmt 4702 ‘‘significant regulatory action within the scope of section 3(f)(1)’’ 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 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 (www.energy.gov/gc/ office-general-counsel). DOE has prepared the following IRFA for the products that are the subject of this proposed rulemaking. For manufacturers of RCWs, 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 proposed 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 RCWs is classified under NAICS 335220, ‘‘Major Household Appliance Manufacturing.’’ The SBA sets a threshold of 1,500 employees or fewer E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules for an entity to be considered as a small business for this category. 1. Description of Reasons Why Action Is Being Considered DOE is proposing amended energy conservation standards for RCWs. EPCA prescribed energy conservation standards for these products (42 U.S.C. 6295(g)(2) and (9)(A)), and directs DOE to conduct future rulemakings to determine whether to amend these standards. (42 U.S.C. 6295(g)(4) and (9)(B)) 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)) This proposed rulemaking is in accordance with DOE’s obligations under EPCA. 2. Objectives of, and Legal Basis for, Rule EPCA authorizes DOE to regulate the energy efficiency of a number of consumer products and certain industrial equipment. Title III, Part B of EPCA sets forth a variety of provisions designed to improve energy efficiency and established the Energy Conservation Program for Consumer Products Other Than Automobiles. These products include RCWs, the subject of this document. (42 U.S.C. 6292(a)(7)) EPCA prescribed energy conservation standards for these products (42 U.S.C. 6295(g)(2) and (9)(A)), and directs DOE to conduct future rulemakings to determine whether to amend these standards. (42 U.S.C. 6295(g)(4) and (9)(B)) This proposed rulemaking is in accordance the 6-year review required under 42 U.S.C. 6295(m)(1). ddrumheller on DSK120RN23PROD with PROPOSALS2 3. Description on Estimated Number of Small Entities Regulated DOE reviewed this proposed rule under the provisions of the Regulatory Flexibility Act and the procedures and policies published on February 19, 2003. 68 FR 7990. DOE conducted a market survey to identify potential small manufacturers of RCWs. DOE began its assessment by reviewing DOE’s CCD,137 California Energy Commission’s Modernized Appliance Efficiency Database System 137 U.S. Department of Energy’s Compliance Certification Database is available at: www.regulations.doe.gov/certification-data/ #q=Product_Group_s%3A* (Last accessed March 25, 2022). VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 (‘‘MAEDbS’’),138 ENERGY STAR’s Product Finder data set,139 individual company websites, and prior RCW rulemakings to identify manufacturers of the covered product. DOE then consulted publicly available data, such as manufacturer websites, manufacturer specifications and product literature, import/export logs (e.g., bills of lading from Panjiva 140), and basic model numbers, to identify OEMs of RCWs. DOE further relied on public data and subscription-based market research tools (e.g., Dun & Bradstreet reports 141) to determine company location, headcount, and annual revenue. DOE also asked industry representatives if they were aware of any small manufacturers during manufacturer interviews. DOE screened out companies that do not offer products covered by this rulemaking, do not meet the SBA’s definition of a ‘‘small business,’’ or are foreign-owned and operated. DOE initially identified 19 OEMs that sell RCWs in the United States. Of the 19 OEMs identified, DOE tentatively determined that one company qualifies as a small business and is not foreignowned and operated. DOE reached out to the small business and invited them to participate in a voluntary interview. The small business did not respond to DOE’s interview request. DOE also requested information about small businesses and potential impacts on small businesses while interviewing large manufacturers. 4. Description and Estimate of Compliance Requirements Including Differences in Cost, if Any, for Different Groups of Small Entities The one small business identified manufactures one standard-size toploading clothes washer for residential use. DOE did not identify any RCW models manufactured by this small business listed in the CCD, MAEDbS, or ENERGY STAR databases. Instead, DOE identified this manufacturer through the prior rulemaking analysis. 77 FR 32307. There is limited public information about the energy and water efficiency of 138 California Energy Commission’s Modernized Appliance Efficiency Database System is available at: cacertappliances.energy.ca.gov/Pages/ ApplianceSearch.aspx (Last accessed March 25, 2022). 139 U.S. Environmental Protection Agency’s ENERGY STAR Product Finder is available at: www.energystar.gov/productfinder/ (Last accessed March 25, 2022). 140 S&P Global. Panjiva Market Intelligence is available at: panjiva.com/import-export/UnitedStates (Last accessed May 5, 2022). 141 D&B Hoovers|Company Information|Industry Information|Lists, app.dnbhoovers.com/ (Last accessed August 1, 2022). PO 00000 Frm 00097 Fmt 4701 Sfmt 4702 13615 this small business’s RCW model. Based on a review of available product literature and test data of a comparable RCW model, DOE estimates that their current design would not meet the efficiencies required at TSL 4. Furthermore, DOE’s review of the product suggests that the design could not be easily adapted to meet TSL 4 efficiencies. DOE expects that the small manufacturer would likely need to make significant investments to redesign the product to meet the proposed efficiencies. Therefore, DOE is unable to conclude that the proposed rule would not have a ‘‘significant impact on a substantial number of small entities’’ at this time. DOE seeks comments, information, and data on the number of small businesses in the industry, the names of those small businesses, and their market shares by product class. DOE also requests comment on the potential impacts of the proposed standard on small manufacturers. In particular, DOE seeks comment on the efficiency performance of the small manufacturer’s RCW model and the estimated cost to redesign to the proposed standard level. 5. Duplication, Overlap, and Conflict With Other Rules and Regulations DOE is not aware of any rules or regulations that duplicate, overlap, or conflict with the proposed rule. 6. Significant Alternatives to the Rule The discussion in the previous section analyzes impacts on small businesses that would result from DOE’s proposed rule, represented by TSL 4. In reviewing alternatives to the proposed rule, DOE examined energy conservation standards set at lower efficiency levels. While TSL 1, TSL 2, and TSL 3 would likely reduce the impacts on the one small business manufacturer, it would come at the expense of a reduction in energy savings. TSL 1 achieves 58 percent and TSL 2 achieves 57 percent lower energy savings compared to the energy savings at TSL 4. TSL 3 achieves 49 percent lower energy savings compared to the energy savings at TSL 4. Additionally, TSL 1 and TSL 2 achieve 50 percent and TSL 3 achieves 18 percent lower water savings compared to the water savings at TSL 4. TSL 5 were also analyzed, but it was determined this level would lead to greater costs to manufacturers. Based on the presented discussion, establishing standards at TSL 4 balances the benefits of the energy and water savings at TSL 4 with the potential burdens placed on RCW manufacturers, including small business manufacturers. Accordingly, DOE does not propose one E:\FR\FM\03MRP2.SGM 03MRP2 13616 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules ddrumheller on DSK120RN23PROD with PROPOSALS2 of the other TSLs considered in the analysis, or the other policy alternatives examined as part of the regulatory impact analysis and included in chapter 17 of the NOPR TSD. Additional compliance flexibilities may be available through other means. EPCA provides that a manufacturer whose annual gross revenue from all of its operations does not exceed $8 million may apply for an exemption from all or part of an energy conservation standard for a period not longer than 24 months after the effective date of a final rule establishing the standard. (42 U.S.C. 6295(t)) Additionally, manufacturers subject to DOE’s energy efficiency standards may apply to DOE’s Office of Hearings and Appeals for exception relief under certain circumstances. Manufacturers should refer to 10 CFR part 430, subpart E, and 10 CFR part 1003 for additional details. C. Review Under the Paperwork Reduction Act Under the procedures established by the Paperwork Reduction Act of 1995 (‘‘PRA’’), a person is not required to respond to a collection of information by a Federal agency unless that collection of information displays a currently valid OMB Control Number. OMB Control Number 1910–1400, Compliance Statement Energy/Water Conservation Standards for Appliances, is currently valid and assigned to the certification reporting requirements applicable to covered equipment, including RCWs. DOE’s certification and compliance activities ensure accurate and comprehensive information about the energy and water use characteristics of covered products and covered equipment sold in the United States. Manufacturers of all covered products and covered equipment must submit a certification report before a basic model is distributed in commerce, annually thereafter, and if the basic model is redesigned in such a manner to increase the consumption or decrease the efficiency of the basic model such that the certified rating is no longer supported by the test data. Additionally, manufacturers must report when production of a basic model has ceased and is no longer offered for sale as part of the next annual certification report following such cessation. DOE requires the manufacturer of any covered product or covered equipment to establish, maintain, and retain the records of certification reports, of the underlying test data for all certification testing, and of any other testing conducted to satisfy the requirements of VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 part 429, part 430, and/or part 431. Certification reports provide DOE and consumers with comprehensive, up-to date efficiency information and support effective enforcement. Revised certification data would be required for RCWs were this NOPR to be finalized as proposed; however, DOE is not proposing amended certification or reporting requirements for RCWs in this NOPR. Instead, DOE may consider proposals to establish certification requirements and reporting for RCWs under a separate rulemaking regarding appliance and equipment certification. DOE will address changes to OMB Control Number 1910–1400 at that time, as necessary. 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 PO 00000 Frm 00098 Fmt 4701 Sfmt 4702 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 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 E:\FR\FM\03MRP2.SGM 03MRP2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules ddrumheller on DSK120RN23PROD with PROPOSALS2 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 www.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 RCW 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 RCWs, 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 VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 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 RCWs 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. 13617 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%20 Updated%20IQA%20Guidelines%20 Dec%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. 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. 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 RCWs, 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. 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 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 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 proposed 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. PO 00000 Frm 00099 Fmt 4701 Sfmt 4702 E:\FR\FM\03MRP2.SGM 03MRP2 13618 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules 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.142 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. Because available data, models, and technological understanding have changed since 2007, DOE has engaged with the NAS to review DOE’s analytical methodologies to ascertain whether modifications are needed to improve the Department’s analyses. DOE is in the process of evaluating the resulting report.143 VII. Public Participation A. Participation in the Webinar ddrumheller on DSK120RN23PROD with PROPOSALS2 The time and date of the webinar meeting 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 at www1.eere.energy.gov/buildings/ appliance_standards/ standards.aspx?productid=68. Participants are responsible for ensuring their systems are compatible with the webinar software. 142 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 June 12, 2022). 143 The report is available at www.nationalacademies.org/our-work/review-ofmethods-for-setting-building-and-equipmentperformance-standards. VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 B. Procedure for Submitting Prepared General Statements for Distribution Any person who has an interest in the topics addressed in this document, or who is representative of a group or class of persons that has an interest in these issues, may request an opportunity to make an oral presentation at the webinar. Such persons may submit to ApplianceStandardsQuestions@ ee.doe.gov. Persons who wish to speak should include with their request a computer file in WordPerfect, Microsoft Word, PDF, or text (ASCII) file format that briefly describes the nature of their interest in this rulemaking and the topics they wish to discuss. Such persons should also provide a daytime telephone number where they can be reached. DOE requests persons selected to make an oral presentation to submit an advance copy of their statements at least two weeks before the webinar. At its discretion, DOE may permit persons who cannot supply an advance copy of their statement to participate, if those persons have made advance alternative arrangements with the Building Technologies Office. As necessary, requests to give an oral presentation should ask for such alternative arrangements. C. Conduct of the Webinar DOE will designate a DOE official to preside at the webinar/public meeting and may also use a professional facilitator to aid discussion. The meeting will not be a judicial or evidentiary-type public hearing, but DOE will conduct it in accordance with section 336 of EPCA. (42 U.S.C. 6306) A court reporter will be present to record the proceedings and prepare a transcript. DOE reserves the right to schedule the order of presentations and to establish the procedures governing the conduct of the 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 and until the end of the comment period, interested parties may submit further comments on the proceedings, as well as on any aspect of the proposed rulemaking. The webinar will be conducted in an informal, conference style. DOE will present a general overview of the topics addressed in this proposed rulemaking, allow time for prepared general statements by participants, and encourage all interested parties to share their views on issues affecting this proposed rulemaking. Each participant will be allowed to make a general PO 00000 Frm 00100 Fmt 4701 Sfmt 4702 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 proposed rulemaking. The official conducting the webinar/public meeting will accept additional comments or questions from those attending, as time permits. The presiding official will announce any further procedural rules or modification of the previous procedures that may be needed for the proper conduct of the webinar. A transcript of the webinar 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 E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules 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 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, hand delivery/courier, or postal mail. Comments and documents submitted via email, hand delivery/courier, or postal mail 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. If you submit via postal mail or hand delivery/ courier, please provide all items on a CD, if feasible, in which case it is not necessary to submit printed copies. 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 VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 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 product class structure analyzed in this NOPR. (2) DOE seeks comment on the technology options not identified in this NOPR that manufacturers may use to attain higher efficiency levels of RCWs. (3) DOE seeks comment on whether any additional technology options should be screened out on the basis of any of the screening criteria in this NOPR. (4) DOE seeks comment on whether the baseline efficiency levels analyzed in this NOPR for each product class are appropriate. (5) DOE seeks comment on whether the higher efficiency levels analyzed in this NOPR for each product class are appropriate. (6) DOE seeks comment on whether the efficiency levels analyzed in this NOPR for semi-automatic RCWs are appropriate. (7) DOE seeks comment on the baseline MPCs and incremental MPCs developed for each product class. PO 00000 Frm 00101 Fmt 4701 Sfmt 4702 13619 (8) DOE seeks comment on its tentative determination to use the DOE dataset as the basis for the translation equations rather than use the joint DOE– AHAM dataset. (9) DOE seeks comment on its tentative determination not to merge the compact and standard-size translations, but to instead develop separate translations for each product class. (10) DOE seeks comment on whether it should consider defining an ‘‘unadjusted’’ baseline efficiency level based on a translation between appendix J2 and appendix J metrics without consideration of any changes to spin implementations as a result of adopting the appendix J test procedure. (11) DOE requests comment and information on the specific efficiency levels at which any potential rebound effects may happen, as well as the magnitude of the effect. (12) DOE requests comment and information on frequency of cleaning cycles run per number of cycles used to clean clothes and associated data as compared to the recommendations in the manufacturer’s use and care manuals. (13) DOE requests comment and information on RCW lifetime. (14) DOE seeks comment on the approach and inputs used to develop no-new standards case shipments projection and market share for each product class. (15) DOE requests data on the market size and typical selling price of units sold through the second-hand market for residential clothes washers. (16) For households who would be negatively impacted by amended energy conservation standards, a potential rebate program to reduce the total installed costs would be effective in lowering the percentage of consumers with a net cost and reducing simple payback period. DOE is aware of 80 rebate programs currently available for residential clothes washers meeting ENERGY STAR requirements initiated by 63 organizations in various States as described in chapter 17 of the NOPR TSD. DOE is seeking comment about how amended energy conservation standards may impact the low-income and senior-only consumer economics being presented and considered in this proposed rulemaking. (17) DOE is seeking comment about definable subpopulations in addition to low-income and senior-only households and the associated data required to differentiate how such subpopulation use clothes washers. (18) To consider to costs of monitoring test procedure and energy conservation standard rulemakings, E:\FR\FM\03MRP2.SGM 03MRP2 ddrumheller on DSK120RN23PROD with PROPOSALS2 13620 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules 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. (19) DOE seeks comment on the availability of direct drive motors in quantities required by industry if DOE were to adopt amended standards. (20) DOE seeks comments, information, and data on the capital conversion costs and product conversion costs estimated for each TSL. (21) DOE seeks comment on whether manufacturers expect manufacturing capacity constraints due to production facility updates would limit product availability to consumers in the timeframe of the amended standard compliance date (2027). (22) DOE requests information regarding the impact of cumulative regulatory burden on manufacturers of RCWs associated with multiple DOE standards or product-specific regulatory actions of other Federal agencies. (23) DOE seeks comment on whether the Consumer Reports test produces cleaning performance results that are representative of an average use cycle as measured by the DOE test procedure. DOE also seeks comment on how relative cleaning performance results would vary if tested under test conditions consistent with the DOE appendix J test procedure. (24) DOE requests comment on its use of the Hot temperature selection with the large load size to evaluate potential impacts on clothes washer performance as a result of amended standards. (25) DOE requests comment on its use of the Soil/Stain Removal test and Mechanical Action test specified in AHAM HLW–2–2020 as the basis for evaluating performance-related concerns expressed by AHAM and manufacturers. (26) DOE requests comment on its wash temperature data presented in the performance characteristics test report and on its tentative conclusions derived from this data. DOE requests any additional data DOE should consider about wash temperatures at the proposed standard level, as DOE’s data leads to the tentative conclusion that fatty soils would be able to be dissolved at this efficiency level. (27) DOE requests comment on its stain removal data presented in the VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 performance characteristics test report and on its conclusions derived from this data. In particular, DOE requests comment on whether the clustering of data at or above a score of 90 (as measured on the Hot temperature selection with the large load size) corresponds to a market-representative threshold of stain removal performance as measured with this cycle configuration. DOE additionally requests comment on its analysis indicating that implementing additional hardware design options, rather than reducing wash temperatures, on EL 2 units could enable total cleaning scores at EL 3 that are equally as high as the highest scores currently achieved by units at lower efficiency levels. (28) DOE requests comment on its mechanical action data presented in the performance characteristics test report and on its conclusions derived from this data. In particular, DOE requests comment on whether there is a marketrepresentative threshold of mechanical action performance as measured on the Hot temperature selection using the large load size. DOE also requests comment on whether better mechanical action scores at higher top-loading efficiency levels are attributable to the use of wash plates rather than traditional agitators in those higherefficiency units. (29) DOE requests comment on its cycle time data presented in the performance characteristics test report and on its conclusions derived from this data. (30) DOE seeks comment on its testing and assessment of performance attributes (i.e., wash temperatures, stain removal, mechanical action, and cycle duration), particularly at the proposed standard level (i.e., TSL 4). In addition, DOE seeks additional data that stakeholders would like DOE to consider on performance attributes at TSL 4 efficiencies as well as the current minimum energy conservation standards. (31) DOE requests comment and information on sales of RCWs with deep fill and/or deep rinse options or settings and the frequency of use of cycles with these options or settings selected. (32) DOE requests data and information regarding any quantitative performance-related characteristics at TSL 4 in comparison to performance at the current baseline level (e.g., cleaning performance, rinsing performance, fabric wear, etc.), particularly for toploading standard-size RCWs. (33) DOE seeks comments, information, and data on the number of small businesses in the industry, the names of those small businesses, and PO 00000 Frm 00102 Fmt 4701 Sfmt 4702 their market shares by product class. DOE also requests comment on the potential impacts of the proposed standard on small manufacturers. In particular, DOE seeks comment on the efficiency performance of the small manufacturer’s RCW model and the estimated cost to redesign to the proposed standard level. Additionally, DOE welcomes comments on other issues relevant to the conduct of this 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 and announcement of public meeting. 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 February 9, 2023, by Francisco Alejandro Moreno, Acting 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 February 21, 2023. 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: ■ E:\FR\FM\03MRP2.SGM 03MRP2 13621 Federal Register / Vol. 88, No. 42 / Friday, March 3, 2023 / Proposed Rules Authority: 42 U.S.C. 6291–6309; 28 U.S.C. 2461 note. 2. Amend § 430.32 by: a. Removing paragraphs (g)(1) through (3); ■ b. Redesignating paragraph (g)(4) as paragraph (g)(1); ■ c. Revising the introductory sentence of newly redesignated paragraph (g)(1); and ■ ■ d. Adding new paragraph (g)(2). The addition and revision read as follows: ■ § 430.32 Energy and water conservation standards and their compliance dates. * * * * * (g) Clothes washers. (1) Clothes washers manufactured on or after January 1, 2018, and before [Date 3 years after date of publication of final rule in the Federal Register], shall have an Integrated Modified Energy Factor no less than, and an Integrated Water Factor no greater than:* * * (2) Clothes washers manufactured on or after [Date 3 years after date of publication of final rule in the Federal Register], shall have an Energy Efficiency Ratio and a Water Efficiency Ratio no less than: Product class Semi-Automatic Clothes Washers ........................................................................................................................... Automatic Clothes Washers: Top-Loading, Ultra-Compact (less than 1.6 ft3 capacity) ................................................................................. Top-Loading, Standard-Size (1.6 ft3 or greater capacity) ................................................................................ Front-Loading, Compact (less than 3.0 ft3 capacity) ....................................................................................... Front-Loading, Standard-Size (3.0 ft3 or greater capacity) .............................................................................. * * * * * [FR Doc. 2023–03862 Filed 3–2–23; 8:45 am] ddrumheller on DSK120RN23PROD with PROPOSALS2 BILLING CODE 6450–01–P VerDate Sep<11>2014 21:12 Mar 02, 2023 Jkt 259001 PO 00000 Frm 00103 Fmt 4701 Sfmt 9990 E:\FR\FM\03MRP2.SGM 03MRP2 Energy efficiency ratio (lb/kWh/cycle) Water efficiency ratio (lb/gal/cycle) 2.12 0.27 3.79 4.78 5.02 5.73 0.29 0.63 0.71 0.77

Agencies

DEPARTMENT OF ENERGY

[Federal Register Volume 88, Number 42 (Friday, March 3, 2023)]
[Proposed Rules]
[Pages 13520-13621]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-03862]



[[Page 13519]]

Vol. 88

Friday,

No. 42

March 3, 2023

Part II





Department of Energy





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





10 CFR Part 430





Energy Conservation Program: Energy Conservation Standards for 
Residential Clothes Washers; Proposed Rule

Federal Register / Vol. 88 , No. 42 / Friday, March 3, 2023 / 
Proposed Rules

[[Page 13520]]


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

DEPARTMENT OF ENERGY

10 CFR Part 430

[EERE-2017-BT-STD-0014]
RIN 1904-AD98


Energy Conservation Program: Energy Conservation Standards for 
Residential Clothes Washers

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 residential 
clothes washers (``RCWs''). 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 RCWs, 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 Tuesday, 
March 28, 2023, from 1:00 p.m. to 4:00 p.m. See section VII of this 
document, ``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 May 2, 2023.
    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 April 3, 2023.

ADDRESSES: Interested persons are encouraged to submit comments using 
the Federal eRulemaking Portal at www.regulations.gov, under docket 
number EERE-2017-BT-STD-0014. Follow the instructions for submitting 
comments. Alternatively, interested persons may submit comments, 
identified by docket number EERE-2017-BT-STD-0014, by any of the 
following methods:
    Email: [email protected]. Include the 
docket number EERE-2017-BT-STD-0014 in the subject line of the message.
    Postal Mail: Appliance and Equipment Standards Program, U.S. 
Department of Energy, Building Technologies Office, Mailstop EE-5B, 
1000 Independence Avenue SW, Washington, DC 20585-0121. Telephone: 
(202) 287-1445. If possible, please submit all items on a compact disc 
(``CD''), in which case it is not necessary to include printed copies.
    Hand Delivery/Courier: Appliance and Equipment Standards Program, 
U.S. Department of Energy, Building Technologies Office, 950 L'Enfant 
Plaza SW, 6th Floor, Washington, DC 20024. Telephone: (202) 287-1445. 
If possible, please submit all items on a CD, in which case it is not 
necessary to include printed copies.
    No telefacsimiles (``faxes'') will be accepted. For detailed 
instructions on submitting comments and additional information on this 
process, see section VII 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-2017-BT-STD-0014. The docket web page contains instructions on how 
to access all documents, including public comments, in the docket. See 
section VII of this document for information on how to submit comments 
through www.regulations.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 
proposed rule.

FOR FURTHER INFORMATION CONTACT: 
    Dr. Carl Shapiro, 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. Telephone: 
(202) 287-5649. Email: [email protected].
    Ms. Melanie Lampton, U.S. Department of Energy, Office of the 
General Counsel, GC-33, 1000 Independence Avenue SW, Washington, DC 
20585-0121. Telephone: (240) 751-5157. 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. History of Standards Rulemaking for Residential Clothes 
Washers
    C. Deviation From Appendix A
III. General Discussion
    A. General Comments
    B. Scope of Coverage
    C. Test Procedure
    1. History of Appendix J
    2. Metrics
    3. Test Cloth
    4. Other Test Procedure-Related Comments
    D. Technological Feasibility
    1. General
    2. Maximum Technologically Feasible Levels
    E. Energy Savings
    1. Determination of Savings
    2. Significance of Savings
    F. 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. Product Classes
    2. Technology Options
    B. Screening Analysis
    1. Screened-Out Technologies
    2. Remaining Technologies

[[Page 13521]]

    C. Engineering Analysis
    1. Preliminary Analysis Prediction Tool
    2. Efficiency Analysis
    a. Baseline Efficiency Levels
    b. Higher Efficiency Levels
    c. Semi-Automatic
    3. Cost Analysis
    4. Cost-Efficiency Results
    5. Translations
    a. Preliminary Analysis Approach
    b. NODA Approach
    c. NOPR Approach
    d. Alternative Approaches
    D. Markups Analysis
    E. Energy and Water Use Analysis
    1. Number of Annual Cycles
    2. Rebound Effect
    3. Water Heating Energy Use
    F. Life-Cycle Cost and Payback Period Analysis
    1. Consumer Product Cost
    2. Installation Cost
    3. Annual Energy and Water Consumption
    4. Energy and Water Prices
    a. Energy Prices
    b. Water and Wastewater Prices
    5. Repair and Maintenance Costs
    6. Product Lifetime
    7. Discount Rates
    8. Energy Efficiency Distribution in the No-New-Standards Case
    9. Payback Period Analysis
    10. Other Issues
    G. Shipments Analysis
    H. National Impact Analysis
    1. Product Efficiency Trends
    2. National Energy and Water Savings
    3. Net Present Value Analysis
    I. Consumer Subgroup Analysis
    1. Low-Income Households
    2. Senior-Only Households
    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. Product Classes
    b. Ability To Serve Certain Consumer Segments
    c. Supply Chain Constraints
    4. Discussion of MIA Comments
    K. Emissions Analysis
    1. Air Quality Regulations Incorporated in DOE's Analysis
    L. Monetizing Emissions Impacts
    1. Monetization of Greenhouse Gas Emissions
    a. Social Cost of Carbon
    b. Social Cost of Methane and Nitrous Oxide
    2. Monetization of Other 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 and Water Savings
    b. Net Present Value of Consumer Costs and Benefits
    c. Indirect Impacts on Employment
    4. Impact on Utility or Performance of Products
    a. Performance Characteristics
    b. Availability of ``Traditional'' Agitators
    c. Water Levels
    d. Availability of Portable Products
    e. Conclusion
    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 Residential 
Clothes Washer 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
    1. Description of Reasons Why Action Is Being Considered
    2. Objectives of, and Legal Basis for, Rule
    3. Description on Estimated Number of Small Entities Regulated
    4. Description and Estimate of Compliance Requirements Including 
Differences in Cost, if Any, for Different Groups of Small Entities
    5. Duplication, Overlap, and Conflict With Other Rules and 
Regulations
    6. Significant Alternatives to the Rule
    C. Review Under the Paperwork Reduction Act
    D. Review Under the National Environmental Policy Act of 1969
    E. Review Under Executive Order 13132
    F. Review Under Executive Order 12988
    G. Review Under the Unfunded Mandates Reform Act of 1995
    H. Review Under the Treasury and General Government 
Appropriations Act, 1999
    I. Review Under Executive Order 12630
    J. Review Under the Treasury and General Government 
Appropriations Act, 2001
    K. Review Under Executive Order 13211
    L. Information Quality
VII. Public Participation
    A. Participation in the Webinar
    B. Procedure for Submitting Prepared General Statements for 
Distribution
    C. Conduct of the Webinar
    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

    The Energy Policy and Conservation Act, Public Law 94-163, as 
amended (``EPCA''),\1\ authorizes DOE to regulate the energy efficiency 
of a number of consumer products and certain industrial equipment. (42 
U.S.C. 6291-6317) Title III, Part B of EPCA \2\ established the Energy 
Conservation Program for Consumer Products Other Than Automobiles. (42 
U.S.C. 6291-6309) These products include consumer (residential) \3\ 
clothes washers (``RCWs''), the subject of this proposed rulemaking.
---------------------------------------------------------------------------

    \1\ All references to EPCA in this document refer to the statute 
as amended through the Energy Act of 2020, Public Law 116-260 (Dec. 
27, 2020), which reflect the last statutory amendments that impact 
Parts A and A-1 of EPCA.
    \2\ For editorial reasons, upon codification in the U.S. Code, 
Part B was redesignated Part A.
    \3\ DOE uses the ``residential'' nomenclature and ``RCW'' 
abbreviation for consumer clothes washers in order to distinguish 
from the ``CCW'' abbreviation used for commercial clothes washers, 
which are also regulated equipment under EPCA.
---------------------------------------------------------------------------

    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 notice of 
proposed rulemaking 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 RCWs. The proposed standards, which are expressed in terms of 
energy efficiency ratio (``EER'') measured in pounds per kilowatt-hour 
per cycle (``lb/kWh/cycle'') and water efficiency ratio (``WER'') 
measured in pounds per gallon per cycle (``lb/gal/cycle'') as measured 
using the test procedure at title 10 of the Code of Federal Regulations 
(``CFR''), part 430, subpart B, appendix J (``appendix J''), are shown 
in Table I.1. These proposed standards, if adopted, would apply to all 
RCWs listed in Table I.1 manufactured in, or imported into, the United 
States starting on the date 3 years after the publication in the 
Federal Register of the final rule for this rulemaking. As shown in 
Table I.1 and discussed further in IV.A.1 of this document, DOE 
proposes standards for separate RCW product classes that are

[[Page 13522]]

defined based on axis of loading (i.e., top-loading or front-loading), 
clothes container capacity (measured in cubic feet (``ft\3\'')), and 
whether the product is automatic or semi-automatic.

    Table I.1--Proposed Energy Conservation Standards for Residential
                             Clothes Washers
------------------------------------------------------------------------
                                      Minimum energy     Minimum water
           Product class             efficiency ratio   efficiency ratio
                                      (lb/kWh/cycle)     (lb/gal/cycle)
------------------------------------------------------------------------
Semi-Automatic Clothes Washers....               2.12               0.27
Automatic Clothes Washers:
    Top-Loading, Ultra-Compact                   3.79               0.29
     (less than 1.6 ft\3\
     capacity)....................
    Top-Loading, Standard-Size                   4.78               0.63
     (1.6 ft\3\ or greater
     capacity)....................
    Front-Loading, Compact (less                 5.02               0.71
     than 3.0 ft\3\ capacity).....
    Front-Loading, Standard-Size                 5.73               0.77
     (3.0 ft\3\ or greater
     capacity)....................
------------------------------------------------------------------------

A. Benefits and Costs to Consumers

    Table I.2 presents DOE's evaluation of the economic impacts of the 
proposed standards, represented by trial standard level (``TSL'') 4, on 
consumers of RCWs, as measured by the average life-cycle cost (``LCC'') 
savings and the simple payback period (``PBP'').\4\ The average LCC 
savings are positive for all product classes, and the PBP is less than 
the average lifetime of RCWs, which is estimated to be 13.7 years (see 
section IV.F.6 of this document).
---------------------------------------------------------------------------

    \4\ 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 Residential Clothes Washers
------------------------------------------------------------------------
                                       Average LCC       Simple payback
           Product class             savings (2021$)     period (years)
------------------------------------------------------------------------
Semi-Automatic Clothes Washers....               $329                0.3
Automatic Clothes Washers:
    Top-Loading, Ultra-Compact                   n.a.               n.a.
     (less than 1.6 ft\3\
     capacity) *..................
    Top-Loading, Standard-Size                    134                5.9
     (1.6 ft\3\ or greater
     capacity)....................
    Front-Loading, Compact (less                    7                9.1
     than 3.0 ft\3\ capacity).....
    Front-Loading, Standard-Size                   19                3.2
     (3.0 ft\3\ or greater
     capacity)....................
------------------------------------------------------------------------
* The entry ``n.a.'' means not applicable because the standard at the
  proposed TSL is the baseline.

    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 
9.3 percent, DOE estimates that the INPV for manufacturers of RCWs in 
the case without amended standards is $1,738.3 million in 2021$. Under 
the proposed standards, the change in INPV is estimated to range from -
30.5 percent to -20.8 percent, which is approximately -$530.2 million 
to -$361.6 million. In order to bring products into compliance with 
amended standards, it is estimated that the industry would incur total 
conversion costs of $690.8 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 ⁵
---------------------------------------------------------------------------

    \5\ All monetary values in this document are expressed in 2021 
dollars.
---------------------------------------------------------------------------

    DOE's analyses indicate that the proposed energy conservation 
standards for RCWs would save a significant amount of energy and water. 
Relative to the case without amended standards, the lifetime energy and 
water savings for RCWs purchased in the 30-year period that begins in 
the anticipated year of compliance with the standards (2027-2056) 
amount to 1.45 quadrillion British thermal units (``Btu''), or quads of 
energy and 2.53 trillion gallons of water, respectively.\6\
---------------------------------------------------------------------------

    \6\ 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.1 of this document.
---------------------------------------------------------------------------

    The cumulative net present value (``NPV'') of total consumer 
benefits of the proposed standards for RCWs ranges from $5.14 billion 
(at a 7-percent discount rate) to $14.52 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 and 
installation costs for RCWs purchased in 2027-2056.
    In addition, the proposed standards for RCWs 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 53.21 million metric tons (``Mt'') \7\ 
of carbon dioxide (``CO2''), 19.93 thousand tons of sulfur 
dioxide (``SO2''), 92.39 thousand tons of nitrogen

[[Page 13523]]

oxides (``NOX''), 411.43 thousand tons of methane 
(``CH4''), 0.48 thousand tons of nitrous oxide 
(``N2O''), and 0.13 tons of mercury (``Hg'').\8\
---------------------------------------------------------------------------

    \7\ A metric ton is equivalent to 1.1 short tons. Results for 
emissions other than CO2 are presented in short tons.
    \8\ DOE calculated emissions reductions relative to the no-new-
standards case, which reflects key assumptions in the Annual Energy 
Outlook 2022 (``AEO2022''). AEO2022 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 AEO2022 assumptions that effect air pollutant 
emissions.
---------------------------------------------------------------------------

    DOE estimates the value of climate benefits from a reduction in 
greenhouse gases (``GHG'') 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 
GHG (``SC-GHG'').\9\ DOE used interim SC-GHG values developed by an 
Interagency Working Group on the Social Cost of Greenhouse Gases 
(``IWG'').\10\ 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 $2.71 billion. 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 sets of SC-
GHG estimates.
---------------------------------------------------------------------------

    \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 benefits where appropriate and permissible 
under law.
    \10\ 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. www.whitehouse.gov/wp-content/uploads/2021/02/TechnicalSupportDocument_SocialCostofCarbonMethaneNitrousOxide.pdf.
---------------------------------------------------------------------------

    DOE estimated the monetary health benefits of SO2 and 
NOX emissions reductions using benefit per ton estimates 
from the scientific literature, as discussed in section IV.L of this 
document. DOE estimated the present value of the health benefits would 
be $1.91 billion using a 7-percent discount rate, and $4.57 billion 
using a 3-percent discount rate.\11\ 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.
---------------------------------------------------------------------------

    \11\ DOE estimates the economic value of these emissions 
reductions resulting from the considered TSLs for the purpose of 
complying with the requirements of Executive Order 12866.
---------------------------------------------------------------------------

    Table I.3 summarizes the economic benefits and costs expected to 
result from the proposed standards for RCWs. 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 Residential Clothes Washers
                                 [TSL 4]
------------------------------------------------------------------------
                                                         Billion 2021$
------------------------------------------------------------------------
                            3% discount rate
------------------------------------------------------------------------
Consumer Operating Cost Savings......................              27.83
Climate Benefits *...................................               2.71
Health Benefits **...................................               4.57
                                                      ------------------
    Total Benefits [dagger]..........................              35.11
Consumer Incremental Product Costs [Dagger]..........              13.31
                                                      ------------------
    Net Benefits.....................................              14.52
------------------------------------------------------------------------
                            7% discount rate
------------------------------------------------------------------------
Consumer Operating Cost Savings......................              12.73
Climate Benefits * (3% discount rate)................               2.71
Health Benefits **...................................               1.91
                                                      ------------------
    Total Benefits [dagger]..........................              17.35
Consumer Incremental Product Costs [Dagger]..........               7.58
                                                      ------------------
    Net Benefits.....................................               5.14
------------------------------------------------------------------------
Note: This table presents the costs and benefits associated with RCWs
  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) (see
  section IV.L of this document). Together these represent the global 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 DOE does not have a single central SC-GHG point estimate.
  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 benefits where appropriate and permissible under law.

[[Page 13524]]

 
** 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. 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 quantified and 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 DOE does not have a single central SC-GHG point estimate.
  DOE emphasizes the importance and value of considering the benefits
  calculated using all four sets of SC-GHG estimates.
[Dagger] Costs include incremental equipment costs as well as
  installation costs.

    The benefits and costs of the proposed standards 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 climate and benefits of 
emission reductions, all annualized.\12\
---------------------------------------------------------------------------

    \12\ 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.
---------------------------------------------------------------------------

    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 RCWs 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 RCWs 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 IV.L of this document.
    Table I.4 presents the total estimated monetized benefits and costs 
associated with the proposed standard, expressed in terms of annualized 
values. 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 NOX and SO2 
emissions, and the 3-percent discount rate case for climate benefits 
from reduced GHG emissions, the estimated cost of the standards 
proposed in this rule is $800.8 million per year in increased equipment 
costs, while the estimated annual benefits are $1,344.2 million in 
reduced equipment operating costs, $155.7 million in climate benefits, 
and $202.0 million in health benefits. In this case, the net benefit 
would amount to $901.1 million per year.
    Using a 3-percent discount rate for all benefits and costs, the 
estimated cost of the proposed standards is $764.0 million per year in 
increased equipment costs, while the estimated annual benefits are 
$1,598.0 million in reduced operating costs, $155.7 million in climate 
benefits, and $262.2 million in health benefits. In this case, the net 
benefit would amount to $1,251.8 million per year.

  Table I.4--Annualized Monetized Benefits and Costs of Proposed Energy Conservation Standards for Residential
                                                 Clothes Washers
                                                     [TSL 4]
----------------------------------------------------------------------------------------------------------------
                                                                                Million 2021$/year
                                                                 -----------------------------------------------
                                                                                     Low-net-        High-net-
                                                                      Primary        benefits        benefits
                                                                     estimate        estimate        estimate
----------------------------------------------------------------------------------------------------------------
                                                3% discount rate
----------------------------------------------------------------------------------------------------------------
Consumer Operating Cost Savings.................................         1,598.0         1,544.5         1,657.8
Climate Benefits *..............................................           155.7           151.7           159.7
Health Benefits **..............................................           262.2           255.8           268.9
                                                                 -----------------------------------------------
    Total Benefits[dagger]......................................         2,015.9         1,952.0         2,086.4
Consumer Incremental Product Costs [Dagger].....................           764.0           778.7           695.5
                                                                 -----------------------------------------------
    Net Benefits................................................         1,251.8         1,173.4         1,390.9
----------------------------------------------------------------------------------------------------------------
                                                7% discount rate
----------------------------------------------------------------------------------------------------------------
Consumer Operating Cost Savings.................................         1,344.2         1,302.8         1,389.7
Climate Benefits * (3% discount rate)...........................           155.7           151.7           159.7
Health Benefits **..............................................           202.0           197.5           206.7
                                                                 -----------------------------------------------
    Total Benefits [dagger].....................................         1,701.9         1,652.0         1,756.1
Consumer Incremental Product Costs[Dagger]......................           800.8           813.3           737.9
                                                                 -----------------------------------------------
    Net Benefits................................................           901.1           838.7         1,018.3
----------------------------------------------------------------------------------------------------------------
Note: This table presents the costs and benefits associated with RCWs shipped in 2027-2056. These results
  include benefits to consumers which accrue after 2056 from the products shipped in 2027-2056. The Primary, Low
  Net Benefits, and High Net Benefits Estimates utilize projections of energy prices from the AEO2022 Reference
  case, Low Economic Growth case, and High Economic Growth case, respectively. In addition, incremental
  equipment costs reflect a medium decline rate in the Primary Estimate, a low decline rate in the Low Net
  Benefits Estimate, and a high decline rate in the High Net Benefits Estimate. The methods used to derive
  projected price trends are explained in sections IV.F.1 and IV.H.3 of this document. Note that the Benefits
  and Costs may not sum to the Net Benefits due to rounding.

[[Page 13525]]

 
* 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
  sets of 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
  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. See section IV.L of this document for more details.
[dagger] Total benefits include 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.
[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, 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, and a 3-percent discount 
rate case for GHG social costs, the estimated cost of the proposed 
standards for RCWs is $800.8 million per year in increased product 
costs, while the estimated annual benefits are $1,344.2 million in 
reduced product operating costs, $155.7 million in climate benefits and 
$202.0 million in health benefits. The net benefit amounts to $901.1 
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.\13\ 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. Accordingly, DOE evaluates 
the significance of energy savings on a case-by-case basis.
---------------------------------------------------------------------------

    \13\ 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 proposed standards are projected to 
result in estimated national energy savings of 1.45 quads FFC, the 
equivalent of the primary annual energy use of 16 million homes. The 
NPV of consumer benefit for these projected energy savings is $5.14 
billion using a discount rate of 7 percent, and $14.52 billion using a 
discount rate of 3 percent. The cumulative emissions reductions 
associated with these energy savings are 53.21 Mt of CO2, 
19.93 thousand tons of SO2, 92.39 thousand tons of 
NOX, 0.13 tons of Hg, 411.43 thousand tons of 
CH4, and 0.48 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) is 
$2.71 billion. The estimated monetary value of the health benefits from 
reduced SO2 and NOX emissions is $1.91 billion 
using a 7-percent discount rate and $4.57 billion using a 3-percent 
discount rate. As such, 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).\14\ 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'').\15\
---------------------------------------------------------------------------

    \14\ See section III.E.2 of this document for further discussion 
of how DOE determines whether energy savings are ``significant'' 
within the context of the statute.
    \15\ The TSD is available in the docket for this proposed 
rulemaking at www.regulations.gov/docket/EERE-2017-BT-STD-0014.
---------------------------------------------------------------------------

    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 
RCWs.

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 RCWs, the 
subject of this document. (42 U.S.C. 6292(a)(7)) EPCA prescribed energy 
conservation standards for these products (42 U.S.C. 6295(g)(2) and 
(9)(A)), and directs DOE to conduct future rulemakings to determine 
whether to amend these standards. (42 U.S.C. 6295(g)(4) and (9)(B)) 
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

[[Page 13526]]

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(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 RCWs appear at 10 CFR 
part 430, subpart B, appendix J (``appendix J'') and appendix J2 
(``appendix J2'').
    DOE must follow specific statutory criteria for prescribing new or 
amended standards for covered products, including RCWs. 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 
(``Secretary'') 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))
    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 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 the manufacturers and on 
the consumers of the products subject to such standard;
    (2) 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 products which are likely to result from the 
imposition of the standard;
    (3) The total projected amount of energy, or as applicable, water, 
savings likely to result directly from the imposition of the standard;
    (4) Any lessening of the utility or the performance of the covered 
products likely to result from the imposition of the standard;
    (5) The impact of any lessening of competition, as determined in 
writing by the Attorney General, that is likely to result from the 
imposition of the standard;
    (6) The need for national energy and water conservation; and
    (7) Other factors the 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 
subcategories. 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 RCWs address 
standby mode and off mode energy use as part of the EER metric. 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 current energy conservation standards for RCWs were established 
in a direct final rule published on May 31, 2012. 77 FR 32308 (``May 
2012 Final Rule'').\16\ These standards are consistent with a joint 
proposal submitted to DOE

[[Page 13527]]

by interested parties representing manufacturers, energy and 
environmental advocates, and consumer groups.\17\
---------------------------------------------------------------------------

    \16\ DOE published a confirmation of effective date and 
compliance date for the direct final rule on October 1, 2012. 77 FR 
59719.
    \17\ Available at: www.regulations.gov/document/EERE-2008-BT-STD-0019-0032.
---------------------------------------------------------------------------

    The current standards are defined in terms of a minimum allowable 
integrated modified energy factor (``IMEF''), measured in cubic feet 
per kilowatt-hour per cycle (``ft\3\/kWh/cycle''), and maximum 
allowable integrated water factor (``IWF''), measured in gallons per 
cycle per cubic foot (``gal/cycle/ft\3\''), as measured according to 
appendix J2. Id. The May 2012 Final Rule established four classes of 
RCW: top-loading, compact (less than 1.6 ft\3\ capacity); top-loading, 
standard-size (1.6 ft\3\ or greater capacity); front-loading, compact 
(less than 1.6 ft\3\ capacity); and front-loading, standard-size (1.6 
ft\3\ or greater capacity). 77 FR 32308, 32316-32320. The May 2012 
Final Rule established a two-phase compliance date--the first phase of 
amended standards applied to RCWs manufactured on or after March 7, 
2015. 77 FR 32308, 32380. The second phase of amended standards, which 
is currently applicable, applies to RCWs manufactured on or after 
January 1, 2018. Id.
    The current energy conservation standards for RCWs are set forth in 
DOE's regulations at 10 CFR 430.32(g)(4) and are shown in Table II.1.

    Table II.1--Federal Energy Conservation Standards for Residential
                             Clothes Washers
------------------------------------------------------------------------
                               Minimum integrated
                                 modified energy     Maximum integrated
        Product class          factor (ft\3\/kWh/    water factor (gal/
                                     cycle)             cycle/ft\3\)
------------------------------------------------------------------------
Top-Loading, Compact (less                    1.15                  12.0
 than 1.6 ft\3\ capacity)...
Top-Loading, Standard-Size                    1.57                   6.5
 (1.6 ft\3\ or greater
 capacity)..................
Front-Loading, Compact (less                  1.13                   8.3
 than 1.6 ft\3\ capacity)...
Front-Loading, Standard-Size                  1.84                   4.7
 (1.6 ft\3\ or greater
 capacity)..................
------------------------------------------------------------------------

2. History of Standards Rulemaking for Residential Clothes Washers
    On August 2, 2019, DOE published a request for information 
(``RFI'') to initiate an effort to determine whether to amend the 
current energy conservation standards for RCWs. 84 FR 37794 (``August 
2019 RFI''). Specifically, through the August 2019 RFI, DOE sought data 
and information that could enable the agency to determine whether DOE 
should propose a ``no new standard'' determination because a more 
stringent standard: (1) would not result in a significant savings of 
energy; (2) is not technologically feasible; (3) is not economically 
justified; or (4) any combination of foregoing. Id.
    On September 29, 2021, DOE published a notification of the 
availability of a preliminary technical support document for RCWs 
(``September 2021 Preliminary Analysis''). 86 FR 53886. In that 
notification, DOE sought comment on the analytical framework, models, 
and tools that DOE used to evaluate potential standards for RCWs, the 
results of preliminary analyses performed, and the potential energy 
conservation standard levels derived from these analyses, which DOE 
presented in the accompanying Preliminary TSD (``September 2021 
Preliminary TSD'').\18\ Id. On October 29, 2021, DOE extended the 
comment period for the September 2021 Preliminary Analysis for an 
additional 45 days. 86 FR 59889.
---------------------------------------------------------------------------

    \18\ September 2021 Residential Clothes Washers Energy 
Conservation Standards Preliminary Technical Support Document. 
Available online at www.regulations.gov/document/EERE-2017-BTSTD-0014-0030.
---------------------------------------------------------------------------

    The September 2021 Preliminary Analysis was conducted based on 
energy and water use metrics as measured according to proposed 
amendments to the test procedure as published in a NOPR on September 1, 
2021 (``September 2021 TP NOPR''). 86 FR 49140. Part of this analysis 
included developing translations between the metrics established by the 
current appendix J2 test procedure (i.e., IMEF and IWF) and the new 
metrics proposed to be established by the new appendix J test procedure 
(i.e., EER and WER).
    On April 13, 2022, DOE published a notification of data 
availability (``NODA'') presenting the results of additional testing 
conducted in furtherance of the development of the translations between 
the current test procedure and the proposed new test procedure. 87 FR 
21816 (``April 2022 NODA''). The April 2022 NODA included a larger 
sample size of RCWs than the September 2021 Preliminary Analysis (44 
units compared to 16 in the September 2021 Preliminary Analysis, and 
covering all proposed product classes). The April 2022 NODA presented 
detailed energy and water use measurements for each model as well as a 
summary of key characteristics pertaining to each model (e.g., product 
class, capacity, cabinet width, etc.). On May 19, 2022, DOE reopened 
the comment period for the April 2022 NODA and provided additional 
information in response to stakeholder questions. 87 FR 30433.
    DOE received comments in response to the September 2021 Preliminary 
Analysis and April 2022 NODA from the interested parties listed in 
Table II.2.

[[Page 13528]]



Table II.2--Written Comments Received in Response to the September 2021 Preliminary Analysis and April 2022 NODA
----------------------------------------------------------------------------------------------------------------
                                                                Comment No. in the docket
                                                          ------------------------------------
                                                            In response to
         Commenter(s)                  Abbreviation         September 2021    In response to     Commenter type
                                                              Preliminary     April 2022 NODA
                                                               Analysis
----------------------------------------------------------------------------------------------------------------
Ameren Illinois, Commonwealth   Ameren et al.............                42             * n/a  Efficiency
 Edison Company, Northwest                                                                      Organization &
 Energy Efficiency Alliance,                                                                    Utilities.
 and Northwest Power and
 Conservation Council Staff.
Appliance Standards Awareness   ASAP et al...............                37                51  Efficiency
 Project, American Council for                                                                  Organizations.
 an Energy-Efficient Economy,
 Consumer Federation of
 America, Natural Resources
 Defense Council.
Art Fraas.....................  Fraas....................                35               n/a  Individual.
Association of Home Appliance   AHAM.....................                40                53  Trade
 Manufacturers.                                                                                 Association.
Commonwealth Edison Company     ComEd and NEEA...........               n/a                50  Utility &
 and Northwest Energy                                                                           Efficiency
 Efficiency Alliance.                                                                           Organization.
GE Appliances.................  GEA......................                38               n/a  Manufacturer.
Members of the committee of     NAS Members..............                34               n/a  National
 the National Academies of                                                                      Advisors.
 Sciences, Engineering, and
 Medicine.
New York State Energy Research  NYSERDA..................                36               n/a  Public Benefit
 and Development Authority.                                                                     Corporation.
Pacific Gas and Electric        CA IOUs..................                43                52  Utilities.
 Company, San Diego Gas and
 Electric, and Southern
 California Edison;
 collectively, the California
 Investor-Owned Utilities.
Samsung.......................  Samsung..................                41               n/a  Manufacturer.
Whirlpool Corporation.........  Whirlpool................                39               n/a  Manufacturer.
----------------------------------------------------------------------------------------------------------------
* ``n/a'' signifies that the commenter or group of commenters did not provide a comment in response to the
  particular notification.

    A parenthetical reference at the end of a comment quotation or 
paraphrase provides the location of the item in the public record.\19\ 
To the extent that interested parties have provided written comments 
that are substantively consistent with any oral comments provided 
during the November 10, 2021, public meeting, DOE cites the written 
comments throughout this document. Any oral comments provided during 
the webinar that are not substantively addressed by written comments 
are summarized and cited separately throughout this document.
---------------------------------------------------------------------------

    \19\ The parenthetical reference provides a reference for 
information located in the docket of DOE's rulemaking to develop 
energy conservation standards for RCWs. (Docket NO. EERE-2017-BT-
STD-0014, which is maintained at www.regulations.gov). The 
references are arranged as follows: (commenter name, comment docket 
ID number, page of that document).
---------------------------------------------------------------------------

    GEA commented in support of AHAM's comments and incorporated AHAM's 
comments into its own by reference. (GEA, No. 38 at p. 2)
    Whirlpool commented that it supports and echo AHAM's positions. 
(Whirlpool, No. 39 at p. 2) Whirlpool added that its comments expand 
upon AHAM's comments and provide additional detail or data to reinforce 
its positions, as well as to comment on areas where AHAM cannot 
comment. (Id.)
    NYSERDA commented that it supports the detailed comments provided 
by ASAP et al., most notably investigating the correlation between 
clothes washer capacity and measured efficiency. (NYSERDA, No. 36 at p. 
2)
    AHAM specified that its comments in response to the April 2022 NODA 
do not supplant its previous comments submitted in response to the 
September 2021 Preliminary Analysis, but instead supplement those 
comments. (AHAM, No. 53 at p. 2)

C. Deviation From Appendix A

    In accordance with section 3(a) of 10 CFR part 430, subpart C, 
appendix A (``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. While DOE published a preliminary analysis for 
this rulemaking, DOE did not publish a framework document in 
conjunction with the preliminary analysis. DOE notes, however, chapter 
2 of the September 2021 Preliminary TSD that accompanied the September 
2021 Preliminary Analysis--entitled Analytical Framework, Comments from 
Interested Parties, and DOE Responses--describes the general analytical 
framework that DOE uses in evaluating and developing potential amended 
energy conservation standards. Additionally, prior to the notification 
of the September 2021 Preliminary Analysis, DOE published an RFI in 
which DOE identified and sought comment on the analyses conducted in 
support of the most recent energy conservation standards rulemakings 
for RCWs. 84 FR 37794. As such, publication of a separate framework 
document would be largely redundant of previously published documents.
    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. DOE requested comment in the August 2019 RFI on the 
technical and economic analyses and provided stakeholders a 60-day 
comment period, after publishing the comment period extension. 84 FR 
37794, 84 FR 44557. Additionally, DOE initially provided a 75-day 
comment period for the September 2021

[[Page 13529]]

Preliminary Analysis with an extension to 120 days. 86 FR 53886, 86 FR 
59889. DOE also provided a 30-day comment period for the April 2022 
NODA and re-opened the comment period for an additional 9 days. 87 FR 
21816, 87 FR 30433. The analytical methods used for this NOPR are 
similar to those used in previous rulemaking notices. As such, DOE 
believes a 60-day comment period is necessary and appropriate and will 
provide interested parties with a meaningful opportunity to comment on 
the proposed rule.

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. General Comments

    This section summarizes general comments received from interested 
parties regarding rulemaking timing and process.
    AHAM commented that publishing the September 2021 TP NOPR and the 
September 2021 Preliminary Analysis concurrently did not allow 
sufficient time for stakeholders to provide meaningful comments on 
either publication. (AHAM, No. 40 at pp. 2-4) AHAM commented that 
although DOE missed the statutory deadlines for both the test procedure 
and standards rulemakings, it is disingenuous to claim that the only 
option is to move forward concurrently on these rulemakings. (Id.) AHAM 
suggested that DOE should have published the test procedure earlier, 
considered implementing fewer changes to the test procedure, or made 
changes that do not require testing to evaluate or reestablish the 
baseline energy conservation standards. (Id.) AHAM expressed concern 
that DOE moving forward concurrently with these rulemakings will likely 
lead to DOE needing to conduct additional analysis based on the 
finalized test procedure before proposing a new energy conservation 
standard, and that DOE is missing the opportunity to receive meaningful 
feedback on the September 2021 Preliminary Analysis. (Id.) AHAM added 
that despite DOE's desire to move quickly to rectify missed statutory 
deadlines, DOE must ensure it meets other statutory criteria, including 
that a standard must be technically and economically justified. (Id.)
    AHAM noted that the comment periods for the September 2021 
Preliminary Analysis and the September 2021 TP NOPR overlapped by 34 
days. AHAM noted that it requested a 92-day comment period extension 
for the September 2021 TP NOPR to provide adequate time to evaluate the 
proposed changes to the test procedure through testing. (AHAM, No. 53 
at p. 2) AHAM added that while it appreciated DOE considering that 
request and extending the comment period by 28 days, that extension was 
insufficient to complete the robust testing plan developed by AHAM and 
its members, gather the test data, and analyze the results. (AHAM, No. 
40 at pp. 2-4; AHAM, No. 53 at p. 2)
    AHAM stated that because of the insufficient time, it was unable to 
provide detailed comment on the accuracy, repeatability, and testing 
burden associated with the proposed test procedure and on its potential 
impact on measured efficiency, or fully comment on the proposed test 
procedures implications related to the September 2021 Preliminary 
Analysis. (AHAM, No. 53 at p. 2) AHAM further stated that it was 
planning its own testing in order to fully understand and evaluate 
DOE's proposed changes. (AHAM, No. 40 at pp. 2-4)
    AHAM commented that it was poor process for DOE to issue a test 
procedure final rule before receiving comments on the April 2022 NODA, 
and to do so during a brief comment period extension. (Id.) AHAM added 
that DOE finalizing the test procedure during the brief NODA comment 
period extension made it nearly impossible for AHAM to review and 
analyze the final test procedure in addition to the new data and 
responses to AHAM's questions in order to formulate complete comments 
on the NODA. (Id.)
    AHAM further commented that although DOE did not hold a public 
meeting for the April 2022 NODA, it appreciated that DOE answered its 
questions and provided more time for comments in order to allow 
commenters to review the updates. (AHAM, No. 53 at pp. 2-3) AHAM 
stated, however, that the timing of when DOE provided links to the 
updated data and responses to questions left very little time for 
review and analysis of the additional data and information. (Id.)
    AHAM noted that although the April 2022 NODA is technically part of 
the energy conservation standards docket, comments on DOE's test data 
could relate to both the energy conservation standards and test 
procedure rulemakings. (AHAM, No. 53 at p. 3) AHAM stated that its 
comments in response to the April 2022 NODA therefore address both the 
test procedure and the energy conservation standards. (Id.) AHAM 
commented that it was poor process for DOE to issue a test procedure 
final rule before receiving comments on the April 2022 NODA, and to do 
so during a brief comment period extension. (Id.) AHAM further 
explained that even though DOE answered or deferred most of AHAM's 
requests in the test procedure final rule and in the April 2022 NODA, 
AHAM's comments on the September 2021 Preliminary Analysis indicated 
that additional information was needed in order to provide full 
feedback to DOE on the test procedure. (Id.) AHAM added that DOE 
finalizing the test procedure during the brief NODA comment period 
extension made it nearly impossible for AHAM to review and analyze the 
final test procedure in addition to the new data and responses to 
AHAM's questions in order to formulate complete comments on the NODA. 
(Id.)
    AHAM requested that DOE allow for 180 days between the publication 
of the test procedure final rule and the end of the comment period for 
the energy conservation standards NOPR. (AHAM, No. 40 at pp. 4-6; AHAM, 
No. 53 at p. 12)
    Samsung also commented that, given the scope of changes proposed in 
appendix J, more data would be needed to establish the baseline and 
efficiency levels, which could further delay the finalization of the 
next energy conservation standards. (Samsung, No. 41 at p. 3) Samsung 
commented that it therefore believes more time and test data are needed 
to fully adopt appendix J. (Id.)
    NYSERDA encouraged DOE to quickly proceed in this rulemaking to 
unlock additional significant savings for New Yorkers. (NYSERDA, No. 36 
at p. 3)
    In response to AHAM's comments regarding the timing of the 
September 2021 TP NOPR and the September 2021 Preliminary Analysis, DOE 
notes that the timing of the test procedure and energy conservation 
standards rulemakings have been conducted in accordance with DOE's 
procedures at appendix A to subpart C of part 430, Procedures, 
Interpretations, and Policies for Consideration of New or Revised 
Energy Conservation Standards and Test Procedures for Consumer Products 
and Certain Commercial/Industrial Equipment (``appendix A'' or 
``Process Rule''). The Process Rule inherently recognizes a certain 
amount of overlap between test procedure and energy conservation 
standards rulemakings. In particular, the Process Rule specifies that 
new test procedures and amended test procedures that impact measured 
energy use or efficiency will be finalized at least 180 days prior to 
the close of the

[[Page 13530]]

comment period for a NOPR proposing new or amended energy conservation 
standards or a notice of proposed determination that standards do not 
need to be amended. Section 8(d)(1) of appendix A. Inherent to this 
requirement is a recognition that the earlier stages of the test 
procedure rulemaking (i.e., the test procedure NOPR stage) would be 
conducted concurrently with the pre-NOPR stages of the energy 
conservation standards rulemaking (i.e., the preliminary analysis 
stage). In other words, the implication of the timing established by 
the Process Rule is that a test procedure NOPR may provide the basis 
for a standards preliminary analysis; while a test procedure final rule 
provides the basis for a standards NOPR. DOE published a test procedure 
final rule on June 1, 2022 (``June 2022 TP Final Rule''). 87 FR 33316. 
This standards NOPR is publishing more than 180 days after the 
publication of the June 2022 TP Final Rule, in accordance with the 
requirements of the Process Rule.
    As acknowledged by AHAM, DOE is conducting this rulemaking in 
fulfillment of its statutory obligations under EPCA. DOE recognizes and 
appreciates the information and data provided by multiple interested 
parties in response to the September 2021 TP NOPR, September 2021 
Preliminary Analysis, and April 2022 NODA. As discussed throughout this 
NOPR, DOE has incorporated data and other information received during 
these prior rulemaking stages into the analyses conducted for this 
NOPR.
    In response to the September 2021 Preliminary TSD, AHAM commented 
that DOE did not provide sufficient data to support the September 2021 
Preliminary TSD, and that DOE's analysis was not transparent. (AHAM, 
No. 40 at pp. 4-6) AHAM asserted that by providing summary data and 
conclusions without providing further detail, DOE failed to meet the 
requirements of the Administrative Procedure Act or the Data Quality 
Act. (Id.) AHAM further commented that the summary information that DOE 
provided as part of the September 2021 Preliminary TSD was somewhat 
helpful but did not allow stakeholders to fully assess the data and did 
not clearly demonstrate that DOE's proposed translation between 
appendix J2 and proposed appendix J was accurate. (Id.) AHAM requested 
that DOE provide its full test data by model for all models tested to 
appendix J2 and new appendix J, via a NODA or other appropriate 
regulatory tool. (Id.) AHAM also requested that DOE share the model 
numbers of the clothes washers it tested since it would help 
stakeholders, such as AHAM and its members, determine the 
representativeness of the sample. (Id.) Specifically, AHAM requested 
that all data released contain all variables including, but not limited 
to: total weighted per-cycle hot water energy consumption 
(``HET''), total weighted per-cycle machine electrical 
energy consumption (``MET''), total per-cycle energy 
consumption for removal of moisture (``DET''), combined per-
cycle low power mode energy consumption (``ETLP''), and 
total weighted per-cycle water consumption (``QT''). (Id.) 
AHAM asked that if DOE cannot provide the information AHAM requested, 
DOE should issue an explanation as to why it cannot produce the data. 
(Id.) AHAM added that it will consider sharing its data confidentially 
with DOE once its analysis is complete so that DOE can include its 
analysis on the docket. (Id.)
    AHAM stated that DOE should not issue an energy conservation 
standards NOPR until it publishes a NODA that provides updated data 
from DOE and AHAM members' testing. (AHAM, No. 40 at pp. 4-6)
    In response to the April 2022 NODA, AHAM commented that it had 
tested 26 RCW models that represent a cross-section of the market in 
terms of capacity and features. (AHAM, No. 53 at pp. 6-7) AHAM tested 
each model one to three times and averaged the results. (Id.) AHAM 
presented data comparing IMEF versus EER and IWF versus WER for the 26 
units tested by AHAM and the 44 units tested by DOE in the April 2022 
NODA, by product class. (Id.) AHAM concluded that DOE's data presented 
in the April 2022 NODA appears to be similar to AHAM's data in terms of 
test results, distribution of models, and variability. (Id.) AHAM 
commented that while it appreciates DOE including equations and other 
transparent information in the April 2022 NODA, DOE still has not 
provided model numbers for the units it tested. (Id.) AHAM therefore 
noted that it is impossible for AHAM to know whether DOE and AHAM 
tested some of the same models. (Id.)
    The CA IOUs encouraged DOE to disclose clothes washer cycle time, 
length of spin time for extracting rinse water, and the maximum spin 
speed for the 62 clothes washers tested by DOE so that interested 
parties could better ascertain the trade-offs related to cycle time and 
gain a better understanding of the differences between the remaining 
moisture content (``RMC'') \20\ as calculated using appendix J2 versus 
appendix J. (CA IOUs, No. 43 at p. 4) The CA IOUs commented that in the 
September 2021 Preliminary TSD, higher spin speeds and longer spin 
times were both used as design options for efficiency level (``EL'') 3 
and EL 4, depending on the product class and that based on the publicly 
available information, they were unable to assess the potential impacts 
to the overall cycle time or to understand the potential trade-offs for 
higher spin speeds in lieu of longer cycle times. (Id.)
---------------------------------------------------------------------------

    \20\ The RMC represents the amount of moisture remaining in the 
test load at the end of the washer cycle. RMC is used to calculate 
the drying energy component of IMEF and EER. On most clothes 
washers, the drying energy component represents the largest portion 
of energy captured in the IMEF and EER metrics.
---------------------------------------------------------------------------

    As discussed in section II.B.2 of this document, the April 2022 
NODA presented additional test data and detailed information 
characterizing each tested model. This data included the key energy and 
water use parameters requested by AHAM (i.e., HET, 
MET, DET, ETLP, and QT) for 
each of the models tested. DOE also provided a number of key 
characteristics pertaining to each model (e.g., product class, 
capacity, cabinet width, etc.) that illustrate the types of units on 
the market that were represented by DOE's test program. DOE appreciates 
the additional test data subsequently provided by AHAM. As discussed in 
section IV.C.5 of this document, DOE used AHAM's data in combination 
with DOE's data to evaluate the appendix J2 to appendix J efficiency 
metric translation methods under consideration.
    Regarding the CA IOUs' comment requesting disclosure of the cycle 
time measured for each unit in DOE's test sample, although the April 
2022 NODA did not indicate the measured cycle time of each unit in 
DOE's test sample, DOE has characterized the average cycle time 
associated with each defined efficiency level for each product, as 
described in chapter 5 of the NOPR TSD.
    NAS Members commented generally on DOE's analytical approach to 
setting efficiency standards and offered findings and recommendations 
for improving DOE's methodology, and ultimately, the net social 
benefits of the efficiency standards DOE establishes under EPCA. (NAS 
Members, No. 34 at pp. 1-7)
    AHAM commented that National Academy of Sciences (``NAS'') recently 
released a peer review of methods used by DOE in setting appliance and 
equipment standards. (AHAM, No. 40 at p. 9) AHAM recommended that DOE 
determine how it will address the NAS

[[Page 13531]]

report before engaging in further rulemakings or new amended standards. 
(Id.) AHAM acknowledged that although this may not be feasible given 
the number of missed deadlines and the need to move forward to mitigate 
further missed deadlines, AHAM and its members are reviewing the NAS 
report and may have additional comments on how DOE should revise its 
methodology for future rulemakings both generally, and with regard to 
RCWs. (Id.)
    In response to AHAM, DOE is addressing the contents of the NAS 
report \21\ in a separate rulemaking, in parallel with other ongoing 
rulemakings including this RCW rulemaking.
---------------------------------------------------------------------------

    \21\ The Consensus Study Report, ``Review of Methods Used by the 
U.S. Department of Energy in Setting Appliance and Equipment 
Standards,'' January 7, 2022. Available at www.nap.edu/catalog/25992/review-of-methods-used-by-the-us-department-of-energy-in-setting-appliance-and-equipment-standards.
---------------------------------------------------------------------------

B. Scope of Coverage

    This NOPR covers those consumer products that meet the definition 
of ``clothes washer.'' 10 CFR 430.2.
    EPCA does not define the term ``clothes washer.'' DOE has defined a 
``clothes washer'' as a consumer product designed to clean clothes, 
utilizing a water solution of soap and/or detergent and mechanical 
agitation or other movement, that must be one of the following classes: 
automatic clothes washers, semi-automatic clothes washers, and other 
clothes washers. Id.
    An ``automatic clothes washer'' is a class of clothes washer that 
has a control system that is capable of scheduling a preselected 
combination of operations, such as regulation of water temperature, 
regulation of the water fill level, and performance of wash, rinse, 
drain, and spin functions without the need for user intervention 
subsequent to the initiation of machine operation. Some models may 
require user intervention to initiate these different segments of the 
cycle after the machine has begun operation, but they do not require 
the user to intervene to regulate the water temperature by adjusting 
the external water faucet valves. Id.
    A ``semi-automatic clothes washer'' is a class of clothes washer 
that is the same as an automatic clothes washer except that user 
intervention is required to regulate the water temperature by adjusting 
the external water faucet valves. Id. ``Other clothes washer'' means a 
class of clothes washer that is not an automatic or semi-automatic 
clothes washer. Id.
    See section IV.A.1 of this document for discussion of the product 
classes analyzed in this NOPR.
    Other definitions relevant to RCWs have been established by the 
Environmental Protection Agency (``EPA'') for purposes of the ENERGY 
STAR program. For example, Version 8.1 of the Program Requirements 
Product Specification for Clothes Washers (``ENERGY STAR Version 8.1 
Specification'') \22\ defines a ``combination all-in-one washer-dryer'' 
as a consumer product that meets the definition of an RCW and an 
electric clothes dryer or gas clothes dryer, which cleans and dries 
clothes in a single tumble-type drum; a drying cycle can be performed 
independently without first performing a wash cycle. During the drying 
cycle, combination all-in-one washer-dryers use one of two methods to 
dry the clothing load: either using circulated air (without the use of 
water) to cool and condense moisture from the dryer process air (i.e., 
``combination all-in-one washer-dryers with air-only drying''), or 
consuming water to cool and condense moisture from the dryer process 
air (i.e., ``combination all-in-one washer-dryers with water-cooled 
drying''). In the ENERGY STAR Version 8.1 Specification, combination 
all-in-one washer-dryers with air-only drying are eligible for ENERGY 
STAR certification, whereas combination all-in-one washer-dryers with 
water-cooled drying are ineligible for ENERGY STAR certification.
---------------------------------------------------------------------------

    \22\ ENERGY STAR Version 8.1 Program Requirements Product 
Specification for Clothes Washers. Available online at 
www.energystar.gov/sites/default/files/asset/document/ENERGY%20STAR%20Version%208.1%20Clothes%20Washer%20Final%20Specificaiton%20-%20Partner%20Commitments%20and%20Eligibility%20Criteria.pdf.
---------------------------------------------------------------------------

    The CA IOUs encouraged DOE to investigate water-cooled combination 
all-in-one washer-dryers and to take steps to address water usage 
concerns raised by the ENERGY STAR Version 8.1 Specification published 
in April 2021. (CA IOUs, No. 43 at pp. 6-7) The CA IOUs noted that 
combination all-in-one washer-dryers with water-cooled drying are not 
currently subject to any water use standards or water-usage testing 
requirements despite the recent changes finalized by the clothes dryer 
test procedure final rule published on October 8, 2021. (See 86 FR 
56608; Id.) The CA IOUs expressed concern that there is unmeasured and 
unregulated water use in products that seemingly include a water 
standard for the washing mode of the same product. (Id.) The CA IOUs 
encouraged DOE to find ways to disclose this information, including 
requiring public disclosure of any product configurations that use 
water during the drying cycle as part of the certification requirements 
and relevant product labeling; making changes to the consumer clothes 
dryer test procedure to measure water use for combination clothes 
washer products; and developing a separate test procedure and standard 
for combination all-in-one washer-dryers and laundry centers that 
include both the washing and drying functions. (Id.)
    Evaluating or developing test procedures is outside the scope of 
this energy conservation standards rulemaking. DOE is not proposing any 
certification or labeling requirements in this NOPR. Instead, DOE may 
consider proposals to establish certification requirements and 
reporting for RCWs under a separate rulemaking regarding appliance and 
equipment certification.

C. 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. DOE's 
current energy conservation standards for RCWs are expressed in terms 
of IMEF and IWF as measured using appendix J2. (See 10 CFR 
430.32(g)(4).)
1. History of Appendix J
    As discussed, the September 2021 TP NOPR proposed a new test 
procedure at appendix J, which proposed to define new energy efficiency 
metrics: an energy efficiency ratio (i.e., EER) and a water efficiency 
ratio (i.e., WER). 86 FR 49140, 49172. EER is defined as the weighted-
average load size in pounds (``lbs'') divided by the sum of (1) the 
per-cycle machine energy, (2) the per-cycle water heating energy, (3) 
the per-cycle drying energy, and (4) the per-cycle standby and off mode 
energy consumption, in kilowatt-hours (``kWh''). Id. WER is defined as 
the weighted-average load size in lbs divided by the total weighted 
per-cycle water consumption for all wash cycles in gallons. Id. For 
both EER and WER, a higher value indicates more efficient performance. 
Id. The September 2021 Preliminary Analysis was performed using the 
appendix J test procedure as it was proposed in the September 2021 TP 
NOPR.
    As discussed, DOE finalized the new appendix J test procedure in 
the June 2022 TP Final Rule. 87 FR 33316. DOE used appendix J as 
finalized in the June

[[Page 13532]]

2022 TP Final Rule as the basis for the analysis in this NOPR.
    AHAM commented that DOE did not finalize appendix J as proposed in 
the September 2021 TP NOPR and that the test procedure changes 
described in the June 2022 TP Final Rule could impact measured energy 
and water efficiency. (AHAM, No. 53 at p. 12) AHAM asserted that it may 
be premature to use the April 2022 NODA data or AHAM's additional data 
to inform the translation from appendix J2 metric to appendix J metrics 
because appendix J is not identical to the test procedure proposed in 
the September 2021 TP NOPR. (Id. at p. 3)
    AHAM commented that it is still reviewing finalized appendix J and 
noted that even if DOE's and AHAM's samples together represent a 
significant portion of shipments, it may be necessary to reconsider the 
September 2021 Preliminary Analysis based on finalized appendix J. 
(Id.)
    The appendix J test procedure finalized by the June 2022 TP Final 
Rule included only one change that affects measured energy consumption. 
Specifically, the June 2022 TP Final Rule updated the assumed final 
moisture content (``FMC'') assumption in the drying energy formula from 
4 percent as proposed in the September 2021 NOPR to 2 percent in 
finalized appendix J. Id. at 87 FR 33354. DOE specifically discussed in 
the September 2021 NOPR that it would consider updating the FMC from 4 
percent to 2 percent. 86 FR 49140, 49176. The updated FMC value affects 
only the drying energy calculation and can be implemented formulaically 
on any test data that was acquired using the version of appendix J as 
proposed in the September 2021 TP NOPR. In the April 2022 NODA, DOE 
published two sets of translation equations corresponding to an FMC of 
4 percent and 2 percent, respectively, providing interested parties 
with the opportunity to evaluate the data under both approaches. 87 FR 
21816, 21817.
2. Metrics
    As discussed, under appendix J2, energy efficiency is measured 
using the IMEF metric, measured in ft\3\/kWh/cycle, and water 
efficiency is measured using the IWF metric, measured in gal/cycle/
ft\3\. Under appendix J, energy efficiency is measured using the EER 
metric, measured in lb/kWh/cycle, and water efficiency is measured 
using the WER metric, measured in lb/gal/cycle.
    Samsung commented in support of the efficiency metric changes 
shifting from capacity-based to load size-based, stating that it would 
be better understood by consumers. (Samsung, No. 41 at p. 3) Samsung 
recommended, however, that this be the only change that DOE implements 
to calculate the new energy and water efficiency metrics EER and WER. 
(Id.) Samsung added that shifting the metrics to EER and WER in this 
way will only result in a change in the numeric quantity of measured 
efficiency, given that the capacity and weighted-average load size 
relationship is linear. (Id.) Samsung commented that changing only the 
metric calculation would ease burden for manufacturers while making it 
easier for consumers to understand their clothes washer's efficiency. 
(Id.)
    EPCA requires that any test procedures prescribed or amended by DOE 
shall be reasonably designed to produce test results which measure 
energy efficiency, energy use or estimated annual operating cost of a 
covered product or equipment during a representative average use cycle 
or period of use, and shall not be unduly burdensome to conduct. (42 
U.S.C. 6293(b)(3)) As presented in the June 2022 TP Final Rule, in 
general the changes in appendix J in comparison to appendix J2 improve 
the representativeness of test results and reduce test burden, among 
other benefits. 87 FR 33316, 33320-33321. In this NOPR, DOE is 
proposing standards based on the new metrics defined in appendix J as 
finalized. To aid interested parties in understanding the translation 
between the current metrics and the new metrics, the engineering 
analysis is presented using both the current metrics (i.e., IMEF and 
IWF) and the new metrics (i.e., EER and WER), as discussed in section 
IV.C of this document.
    ASAP et al., commented in support of DOE's change to make the 
efficiency metrics based on load size instead of capacity, which they 
asserted will help mitigate the current bias toward large-capacity 
clothes washers. (ASAP et al., No. 37 at p. 2) ASAP et al., expressed 
concern, however, that for top-loading standard-size clothes washers, 
large-capacity clothes washers still achieve higher efficiency ratings. 
(Id.) ASAP et al., stated that while the correlation between large 
capacity and high efficiency is less pronounced for EER than for IMEF, 
it persists based on the data presented in the September 2021 
Preliminary TSD. (Id.) ASAP et al., therefore encouraged DOE to 
investigate whether this correlation results from larger clothes 
washers being inherently more efficient, larger clothes washers 
employing additional technology options that improve efficiency, or 
some remaining inherent bias toward larger capacity clothes washers. 
(Id.)
    The CA IOUs commented that while they agree that the appendix J 
test procedure offers improvements to the test procedure to reduce some 
inherent biases between efficiency metrics and capacity, tub capacity 
can still contribute to improved efficiency because a larger amount of 
clothing can be washed using an incremental increase in the quantity of 
water, and a larger drum diameter can exert a higher g-force on 
clothing, thereby removing more water during the final spin and 
reducing the drying energy. (CA IOUs, No. 43 at pp. 2-3)
    Whirlpool commented that based on its initial testing, it does not 
agree with DOE's conclusion that there is no benefit to larger 
capacities using the EER metric. Whirlpool commented that since 
capacity is still factored into the load sizes used for testing, and 
those load sizes remain a part of the EER calculation, capacity will 
still affect efficiency ratings. (Whirlpool, No. 39 at p. 19)
    In the June 2022 TP Final Rule, DOE noted that under the current 
metrics in appendix J2, energy use (i.e., the denominator of the IMEF 
equation) scales with weighted-average load size, whereas capacity 
(i.e., the numerator of the IMEF equation) scales with maximum load 
size. 87 FR 33316, 33349. This provides an inherent numerical advantage 
to large-capacity clothes washers that is disproportionate to the 
efficiency advantage that can be achieved through ``economies of 
scale'' associated with washing larger loads. Id. This advantage means 
that a larger-capacity clothes washer consumes more energy to wash a 
pound of clothes than a smaller-capacity clothes washer with the same 
IMEF rating. Id. This relationship applies similarly to water 
efficiency through the IWF equation. Id. This disproportionate benefit 
increases as average clothes washer capacity increases over time. Id. 
To avoid providing bias for large-capacity clothes washers, DOE changed 
the energy and water efficiency metrics in new appendix J by replacing 
the capacity term with the weighted-average load size. Id. Under 
appendix J, energy and water use scale proportionally with weighted-
average load size, thus eliminating the efficiency ``bias'' currently 
provided to large-capacity clothes washers. Id.
    To the extent that larger clothes washers continue to achieve 
higher ratings than smaller clothes washers under the new metrics, such 
higher performance reflects inherent design option advantages 
applicable to larger-

[[Page 13533]]

capacity clothes washers. For example, as noted by the CA IOUs, large-
capacity clothes washers typically have wider drum diameters, which can 
exert higher g-forces on the load during the spin cycle for a given 
spin speed, effectively yielding a lower RMC measurement (i.e., reduced 
drying energy) compared to an otherwise identical smaller clothes 
washer with a narrower drum diameter. Having removed the numerical 
``bias'' inherent within the current IMEF and IWF metrics, any 
remaining performance advantage provided to larger-capacity clothes 
washers under the new metrics is an accurate and representative 
reflection of differences in efficiency between smaller- and larger-
capacity clothes washers on a per-pound of clothing basis.
    AHAM commented that it appreciates that the appendix J test 
procedure results in a reduction of test burden and that DOE could even 
further reduce test burden by eliminating the requirement to measure 
and calculate standby energy. (AHAM, No. 53 at p. 13) AHAM further 
commented that in most cases, the standby energy is so low that it is 
not offset by a benefit to the environment or consumers under EPCA. 
(Id.) AHAM added that because standby energy use is so low, it is 
unlikely that manufacturers will reduce it further in order to meet 
future energy conservation standards; and because manufactures are not 
likely to increase standby energy use since they have already invested 
in reducing it, standby energy use will not be a differentiator between 
products. (Id.) AHAM therefore recommended eliminating the standby 
measurement requirement because it will not have a material effect on 
overall energy savings or individual energy testing results. (Id.)
    As discussed, EPCA requires that any test procedure for RCWs 
prescribed in a final rule after June 30, 2009 must include standby 
mode and off mode energy consumption, taking into consideration the 
most current versions of Standards 62301 and 62087 of the International 
Electrotechnical Commission, with such energy consumption integrated 
into the overall energy efficiency, energy consumption, or other energy 
descriptor for each covered product, unless the Secretary determines 
that either the current test procedures already fully account for and 
incorporate the standby mode and off mode energy consumption of the 
covered product; or such an integrated test procedure is technically 
infeasible for a particular covered product, in which case EPCA 
requires the Secretary to prescribe a separate standby mode and off 
mode energy use test procedure for the covered product, if technically 
feasible. (42 U.S.C. 6295(gg)(2)(A)-(B))
3. Test Cloth
    Both appendix J2 and appendix J require the use of specialized test 
cloth that conforms to the specifications outlined in 10 CFR part 430, 
subpart B, appendix J3 (``appendix J3''). As discussed in the June 2022 
TP Final Rule, the specifications for the energy test cloth were 
developed to be representative of the range of fabrics comprising 
consumer wash loads: a 50-percent cotton/50-percent polyester blended 
material was specified to approximate the typical mix of cotton, 
cotton/polyester blend, and synthetic articles that are machine-washed 
by consumers. 87 FR 33316, 33366. In developing the test cloth 
specifications, DOE also considered:
     Manufacturability: A 50/50 cotton-polyester momie weave 
was specified because at the time, such cloth was produced in high 
volume, had been produced to a consistent specification for many years, 
and was expected to be produced on this basis for the foreseeable 
future. 66 FR 3314, 3331.
     Consistency in test cloth production: The cloth material 
properties were specified in detail, including fiber content, thread 
count, and fabric weight; as well as requirements to verify that water 
repellent finishes are not applied to the cloth. Id.
     Consistency of the RMC measurement among different lots: A 
procedure was developed to generate correction factors for each new 
``lot'' (i.e., batch) of test cloth to normalize test results and 
ensure consistent RMC measurements regardless of which lot is used for 
testing. Id.
    Test cloth is manufactured in batches called ``lots,'' which are 
quantities of test cloth that have been manufactured with the same 
batches of cotton and polyester during one continuous process. Due to 
differences between batches of cotton and polyester used to manufacture 
the test cloth, each lot has slightly different absorption properties. 
To account for these differences in absorption during the RMC 
measurement, appendix J3 specifies a procedure to determine correction 
factors for each lot that correlate the measured RMC values of the new 
test cloth lot with a set of standard RMC values established as the 
historical reference point. These correction factors are applied to the 
RMC test results in appendix J and appendix J2 to ensure the 
repeatability and reproducibility of test results performed using 
different lots of test cloth. In particular, the measured RMC of each 
clothes washer is used to calculate the drying energy, which has a 
significant impact on the final IMEF or EER value. Application of these 
correction factors significantly reduces lot-to-lot variation in RMC, 
from over 10 percentage points uncorrected to around 3 percentage 
points corrected. 87 FR 33316, 33369.
    AHAM commented that it recently notified DOE of an issue concerning 
Lot 24 of the test cloth used in clothes washer testing, stating that 
AHAM's initial investigations have revealed serious issues with 
variation in Lot 24 that are impacting certification, verification, and 
regulatory testing efforts. (AHAM, No. 53 at pp. 4-5) AHAM specified 
that the correction factor for Lot 24 is not accurate across the entire 
lot. (Id.) AHAM further explained that this has resulted in an 
increased difficulty in meeting the applicable standard because the 
inaccurate correction factor is negatively impacting efficiency. (Id.) 
AHAM also specified that it is more difficult to certify products 
correctly or with certainty because the variation in results and 
enforcement are major concerns. (Id.) AHAM also expressed concern that 
testing related to appendix J may be questionable given the Lot 24 
correction factor variation since both DOE and AHAM used Lot 24 for 
over half the units in their test samples. (Id.) AHAM therefore 
concluded that the results of DOE's and AHAM's testing should not be 
used to reestablish a baseline, as they likely do not accurately 
represent measured energy or water efficiency. (Id.) AHAM further 
commented that it convened its test cloth task force to address the 
correction factor variation issue with the goal of providing 
recommendations for DOE, and has sought guidance and an enforcement 
policy from DOE to address the Lot 24 issues in the short-term. (Id.) 
AHAM noted that since the test cloth Lot 24 variation will likely 
impact the accuracy of DOE and AHAM's testing, AHAM will conduct 
further review of its data and may need to submit revised data and/or 
comments once the impact of this variation on the test data is better 
understood. (Id.) AHAM recommended that DOE work to understand the 
impact of this variation on the accuracy of its test data and standards 
analysis. (Id.) For example, AHAM noted that if it has been more 
difficult to meet current standards due to the uncertainty in Lot 24's 
correction factor, DOE will need to understand whether current products 
have been tuned to be more efficient just because of the test cloth. 
(Id.) AHAM added that this could impact DOE's

[[Page 13534]]

analysis of more stringent standards, as some technology options may 
already be in use due to the correction factor issue. (Id.) AHAM also 
recommended that DOE conduct its own analysis of AHAM's data, as well 
as the combined AHAM and DOE dataset, which should include an 
evaluation of the Lot 24 variation. (AHAM, No. 53 at p. 12)
    AHAM also commented that for some time, several manufacturers and, 
likely other testing laboratories, have experienced delays in obtaining 
test cloth. (AHAM, No. 53 at p. 5) AHAM further explained that delays 
in obtaining test cloth mean that some companies need to ration testing 
and may not be able to do testing other than certification and/or audit 
testing until test cloth is received. (Id.) AHAM added that it will 
therefore take more time for AHAM and its members to provide test 
results to support DOE's rulemaking efforts related to clothes washers 
and clothes dryers. (Id.) AHAM requested that DOE ensure it does not 
move so quickly that its analysis (and manufacturers' comments) are 
unable to account for these test cloth challenges. (Id.)
    DOE is acutely aware of the issues regarding variation in Lot 24 
and is participating in the AHAM test cloth task force to help 
determine the root causes of the observed variation and to develop 
solutions to mitigate these concerns for Lot 24 as well as for future 
test cloth lots. Subsequent to the submission of AHAM's comment, the 
AHAM test cloth task force determined to divide Lot 24 into four 
distinct ``sub-lots,'' each with its own correction factors developed 
using the process specified by appendix J3. DOE has added these sub-lot 
correction factors to the RCW test report template published on the DOE 
website.\23\ Establishing these separate sub-lots, each with separate 
correction factors, has mitigated much of the concern regarding 
variability throughout Lot 24. DOE is aware that the task force 
continues to investigate the extent to which any variability that 
remains within each sub-lot can be further mitigated, and DOE continues 
to participate in those efforts.
---------------------------------------------------------------------------

    \23\ DOE's test report templates are available at energy.gov/eere/buildings/standardized-templates-reporting-test-results.
---------------------------------------------------------------------------

    With regard to delays in obtaining test cloth, DOE is aware that 
the causes of delay have largely been addressed and that the test cloth 
supplier is currently working to fulfill the backlog of test cloth 
orders.
4. Other Test Procedure-Related Comments
    In response to the September 2021 Preliminary Analysis and the 
April 2022 NODA, a number of stakeholders made comments pertaining to 
the clothes washer test procedure, many of which DOE subsequently 
addressed in the June 2022 TP Final Rule. Comments regarding certain 
test procedure issues that were not discussed in the June 2022 TP Final 
Rule are summarized in the paragraphs that follow. Addressing test 
procedure concerns is outside the scope of this energy conservation 
standards rulemaking; however, DOE encourages stakeholders to resubmit 
these comments during the next clothes washer test procedure 
rulemaking.
    AHAM commented in opposition to DOE's decision to change the FMC 
assumption from 4 percent in appendix J2 to 2 percent in appendix J. 
(AHAM, No. 53 at p. 12) AHAM stated that the change in FMC assumption 
from 4 to 2 percent will overstate the impact of drying energy and will 
likely drive many clothes washer designs to increase spin speeds and 
spin times beyond an acceptable level. (Id.) AHAM expressed concern 
that this could change a clothes washer's core functionality into a 
water extractor, and in effect, remove the consumer functionality of 
washing the clothes. (Id.) AHAM commented that the test procedure 
should not drive design changes of this magnitude, and added that this 
change will limit the opportunity in the energy conservation standards 
rulemaking for technologically feasible and cost efficient improvements 
because there are limits on how much spin speeds can increase before 
the chassis needs to be redesigned or before safety and consumer 
utility are impacted. (Id.)
    AHAM commented that if DOE moves forward with changing FMC from 4 
to 2 percent, it must address the impact of the apparent mismatch 
between clothes washer drying energy and total per-cycle electric dryer 
energy consumption defined in the clothes dryer test procedures at 10 
CFR part 430, subpart B, appendix D2 (``appendix D2'') or 10 CFR part 
430, subpart B, appendix D1 (``appendix D1''). (AHAM, No. 53 at p. 13) 
AHAM further explained that currently, the drying impact of a clothes 
washer is significantly over-credited as a result of the mismatch in 
clothes loads between the clothes washer and clothes dryer test 
procedures. (Id.) For example, AHAM noted that the average weight of 
the load in appendix J can be nearly 50 percent greater than the weight 
of a load in the clothes dryer test procedure. (Id.) AHAM stated that 
according to the clothes washer test procedure, the annual weight to 
dry for a 6 ft\3\ clothes washer is 2,917 pounds per year, whereas the 
annual weight to dry according to the clothes dryer test procedure is 
1,994 pounds per year, despite the units being a matching pair. (Id.) 
AHAM commented that it acknowledges that this difference makes sense 
because consumers do not dry in the clothes dryer all the clothes they 
wash in the clothes washer. (Id.) However, AHAM emphasized that 
lowering the FMC to 2 percent for clothes washer exacerbates this 
mismatch in energy contribution. (Id.)
    ASAP et al. commented that both DOE's recent analysis for clothes 
dryers and real-world data suggest that drying energy usage in the 
clothes washers analysis is being underestimated and encouraged DOE to 
update its drying energy use calculations in the test procedure to 
better align with DOE's clothes dryers analysis and real-world energy 
usage. (ASAP et al., No. 37 at pp. 3-4) ASAP et al. noted that in the 
September 2021 Preliminary TSD, DOE stated that drying energy use 
represents 75 to 83 percent of total energy usage. (Id.) ASAP et al. 
therefore commented that changes in drying energy estimates can have a 
significant impact on overall energy savings and economic analysis. 
(Id.) ASAP et al. emphasized that, based on DOE's April 2021 Clothes 
Dryers Preliminary TSD,\24\ the active-mode energy use of a clothes 
dryer is between 67 and 93 percent greater than the estimated drying 
energy usage presented in the September 2021 Preliminary TSD for top-
loading standard-size and front-loading clothes washers, 
respectively.\25\ (Id.) ASAP et al. further commented that the clothes 
dryer analysis more closely agrees with real-world clothes dryer energy 
use estimates from data from the Energy Information Administration's 
(``EIA's'') 2015 Residential Energy Consumption Survey (``RECS 
2015''),\26\ which estimates 776 kWh per year, and NEEA's Dryer Field 
Study published in 2014 (``NEEA's Dryer Field Study''),\27\ which 
estimates 915 kWh per year. (Id.) ASAP et al. therefore commented that 
higher, more realistic drying energy

[[Page 13535]]

usage estimates should further improve the cost-effectiveness of higher 
efficiency clothes washers that reduce drying energy use. (Id.)
---------------------------------------------------------------------------

    \24\ Available online at www.regulations.gov/document/EERE-2014-BT-STD-0058-0016.
    \25\ ASAP et al. based this estimate on energy use of 700 kWh/
year for clothes dryers, 419 kWh/year for top-loading clothes 
washers and 362 kWh/year for front-loading clothes washers.
    \26\ U.S. Department of Energy--Energy Information 
Administration, Residential Energy Consumption Survey: 2015 Public 
Use Data Files, 2015. Available at www.eia.doe.gov/emeu/recs/recspubuse15/pubuse15.html.
    \27\ Dryer Field Study, 2014. Northwest Energy Efficiency 
Alliance. Available online at neea.org/resources/rbsa-laundry-study.
---------------------------------------------------------------------------

    Ameren et al. encouraged DOE to mathematically adjust RMC to 
account for the drying energy of 100 percent cotton textiles using the 
relationship established in the 2020 NEEA report \28\ that analyzed the 
RMC of two types of test loads across a broad range of RCW efficiency 
levels and technology types: the 100-percent cotton load specified in 
AHAM's HLW-1-2013 test procedure and the 50/50 cotton-polyester momie 
weave test cloth specified in appendix J2 and appendix J. (Ameren et 
al., No. 42 at pp. 12-13) The NEEA report also developed a linear 
mathematical relationship between the two types of load. (Id.) Ameren 
et al. found that this relationship has an R-squared value close to 1 
and determined that it could be used to adjust the measured RMC of an 
appendix J2 test load to the expected RMC when using an AHAM load. 
(Id.) Ameren et al. stated that adjusting the RMC of an appendix J2 
test load to an RMC typical of 100 percent cotton textiles would more 
realistically account for RCW impacts on drying energy use. (Id.) 
Ameren et al. further commented that most typical laundry loads have a 
much higher cotton content, which they asserted means that 
mathematically adjusting the RMC before calculating drying energy would 
better account for typical energy use. (Id.) Ameren et al. also 
commented that adjusting the RMC of appendix J2 textiles to an RMC 
typical of 100 percent cotton textiles would increase the alignment 
between the September 2021 Preliminary TSD's clothes washer drying 
energy use calculation and the measured appendix D2 clothes dryer 
energy use. (Id.) Ameren et al. added that while other constants such 
as DEF \29\ in appendix J2 and appendix J are relatively consistent 
with most appendix D1 and D2 dryer measurements, the typical drying 
energy calculated in the existing appendix J2 clothes washer test 
procedure is much lower than the energy consumed by a conventional 
clothes dryer tested by appendix D1 or D2. (Id.) Ameren et al. further 
explained that the clothes dryer test procedures use an initial 
moisture content of 57.5 percent for the clothes dryer test load, and 
using NEEA's mathematical adjustment to increase RMC before calculating 
drying energy would make the drying energy calculated in appendix J2 
and J more similar to the drying energy calculated in appendix D1 and 
D2. (Id.)
---------------------------------------------------------------------------

    \28\ Foster Porter, Suzanne; Denkenberger, Dave. 2020. Coming 
Clean: Revealing Real-World Efficiency of Clothes Washers. Portland, 
OR. Northwest Energy Efficiency Alliance. Available online at: 
neea.org/resources/coming-cleanrevealing-real-world-efficiency-of-clothes-washers.
    \29\ ``DEF'' is defined in section 4.3 of appendix J2 and 
section 4.4 of appendix J as the nominal energy required for a 
clothes dryer to remove moisture from clothes and is set equal to 
0.5 kWh/lb.
---------------------------------------------------------------------------

    ASAP et al. commented that one potential partial explanation for 
the apparent underestimation of drying energy usage in the clothes 
washer analysis is the estimate for DEF. (ASAP et al., No. 37 at p. 4) 
ASAP et al. noted that while DOE assumes a DEF of 0.5 kWh per pound of 
moisture removed from clothes, ASAP et al. estimated a higher nominal 
DEF of about 0.6 kWh per pound of moisture removed using weighted-
average clothes dryer efficiency ratings and parameters from the 
clothes dryers test procedure. (Id.) ASAP et al. also commented that a 
2022 NEEA study \30\ suggests that even the clothes dryer test 
procedure can underestimate drying energy usage, particularly when a 
non-ENERGY STAR-rated top-loading clothes washer is paired with a non-
ENERGY STAR electric dryer. (Id.) ASAP et al. further noted that the 
Northwest Regional Technical Forum's most recent estimate for DEF is 
0.65 kWh per pounds of moisture removed.\31\ (Id.)
---------------------------------------------------------------------------

    \30\ Perfect Pairings? Testing the Energy Efficiency of Matched 
Washer-Dryer Sets, 2022. Northwest Energy Efficiency Alliance. 
Available online at neea.org/resources/perfect-pairings-testing-the-energy-efficiency-of-matched-washer-dryer-sets.
    \31\ Regional Technical Forum, Residential Clothes Washers, 
2021. ``Residential Clothes Washers v7.1.'' Available online at 
rtf.nwcouncil.org/measure/clothes-washers-0.
---------------------------------------------------------------------------

    As discussed, DOE is not addressing test procedure changes in this 
energy conservation standards rulemaking. DOE notes that FMC and the 
drying energy calculations were specifically addressed in section 
III.G.2 of the June 2022 TP Final Rule. 87 FR 33316, 33353-33354.

D. Technological Feasibility

1. General
    In each energy conservation standards rulemaking, 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 the 
Process Rule.
    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 the Process Rule. Section 
IV.B of this document discusses the results of the screening analysis 
for RCWs, 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 RCWs, 
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 of this 
proposed rule and in chapter 5 of the NOPR TSD.

E. Energy Savings

1. Determination of Savings
    For each trial standard level (i.e., TSL), DOE projected energy 
savings from application of the TSL to RCWs purchased in the 30-year 
period that begins in the year of compliance with the proposed 
standards (2027-2056).\32\ The savings are measured over the entire 
lifetime of RCWs purchased in the previous 30-year period. DOE 
quantified the energy savings

[[Page 13536]]

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.
---------------------------------------------------------------------------

    \32\ 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'') and national water 
savings (``NWS'') from potential amended or new standards for RCWs. 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.\33\ 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.
---------------------------------------------------------------------------

    \33\ 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. (42 U.S.C. 6295(o)(3)(B))
    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.\34\ 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.
---------------------------------------------------------------------------

    \34\ 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.1 of this document, DOE is 
proposing to adopt TSL 4, which would save an estimated 1.45 quads of 
energy (FFC) over 30 years. 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).

F. Economic Justification

1. Specific Criteria
    As noted previously, EPCA provides seven factors to be evaluated in 
determining whether a potential energy conservation standard is 
economically justified. (42 U.S.C. 6295(o)(2)(B)(i)(I)-(VII)) The 
following sections discuss how DOE has addressed each of those seven 
factors in this proposed 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

[[Page 13537]]

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.E 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 proposed 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 associated with energy production and 
use. DOE conducts an emissions analysis to estimate how potential 
standards may 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 
climate and health benefits from certain emissions reductions resulting 
from the considered TSLs, as discussed in section IV.L of this 
document.
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 proposed rule.

IV. Methodology and Discussion of Related Comments

    This section addresses the analyses DOE has performed for this 
rulemaking with regard to RCWs. Separate subsections 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-2017-BT-STD-0014. Additionally, DOE used output from the 
latest version of the 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

[[Page 13538]]

trends; and (6) technologies or design options that could improve the 
energy efficiency of RCWs. 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.
1. Product Classes
    When evaluating and establishing energy conservation standards, DOE 
may establish separate standards for a group of covered products (i.e., 
establish a separate product class) if DOE determines that separate 
standards are justified based on the type of energy used, or if DOE 
determines that a product's capacity or other performance-related 
feature justifies a different standard. (42 U.S.C. 6295(q)) In making a 
determination whether a performance-related feature justifies a 
different standard, DOE must consider factors such as the utility of 
the feature to the consumer and other factors DOE determines are 
appropriate. (Id.)
    DOE currently defines separate energy conservation standards for 
four RCW product classes (10 CFR 430.32(g)(4)):

 Top-loading, compact (less than 1.6 ft\3\ capacity)
 Top-loading, standard-size (1.6 ft\3\ or greater capacity)
 Front-loading, compact (less than 1.6 ft\3\ capacity)
 Front-loading, standard-size (1.6 ft\3\ or greater capacity)

    In the September 2021 Preliminary Analysis, DOE analyzed four 
potential product classes for RCWs using a threshold of 3.0 ft\3\ to 
differentiate between compact and standard-size front-loading RCWs, in 
contrast to the existing threshold of 1.6 ft\3\, resulting in the 
following product classes being analyzed:

 Top-loading, compact (less than 1.6 ft\3\ capacity)
 Top-loading, standard-size (1.6 ft\3\ capacity or greater)
 Front-loading, compact (less than 3.0 ft\3\ capacity)
 Front-loading, standard-size (3.0 ft\3\ capacity or greater)

    As noted in chapter 2 of the September 2021 Preliminary TSD, there 
are no front-loading RCWs with a capacity less than 1.6 ft\3\ certified 
to DOE, indicating that the current threshold of 1.6 ft\3\ may no 
longer be a relevant differentiator of capacity within the front-
loading RCW market. Based on front-loading RCW models certified in 
DOE's Compliance Certification Database (``CCD''),\35\ DOE identified a 
gap in front-loading capacity between 2.8 ft\3\ and 3.4 ft\3\ (i.e., no 
products are available on the market within this range). The capacity 
gap is directly related to cabinet size--capacities less than 2.8 ft\3\ 
correspond to a 24-inch cabinet width, and capacities larger than 3.4 
ft\3\ correspond to a 27-inch cabinet width. In the September 2021 
Preliminary Analysis, DOE evaluated an updated capacity threshold of 
3.0 ft\3\ between compact-size and standard-size to align more closely 
with product differentiation in the market.
---------------------------------------------------------------------------

    \35\ DOE's Compliance Certification Database is available at 
www.regulations.doe.gov/certification-data.
---------------------------------------------------------------------------

    In the September 2021 Preliminary Analysis, DOE requested comment 
on whether it should revise the definitions of the front-loading 
product classes by increasing the capacity threshold of the front-
loading compact product class to 3.0 ft\3\. DOE also requested comment 
on whether any other changes to product class definitions are 
warranted.
    Prior to the May 2012 Final Rule, DOE also defined a separate RCW 
product class for top-loading semi-automatic clothes washers. Semi-
automatic clothes washers are designed to be intermittently attached to 
a kitchen or bathroom faucet and require user intervention to regulate 
the water temperature by adjusting the external water faucet valves. 
Top-loading semi-automatic clothes washers were subject to a design 
standard requiring an unheated rinse water option, as established by 
the National Appliance Energy Conservation Act of 1987, Public Law 100-
12 (``NAECA''). NAECA amended EPCA to require that all rinse cycles of 
RCWs shall include an unheated water option, but may have a heated 
water rinse option, for products manufactured on or after January 1, 
1988.
    In the May 2012 Final Rule, DOE eliminated the top-loading semi-
automatic product class distinction, having determined based on its 
market research and comments submitted by AHAM and three manufacturers 
that such products were no longer available on the market. 77 FR 32308, 
32317. The top-loading standard-size levels that were established in 
the May 2012 Final Rule were based on consideration of only top-loading 
automatic clothes washers.
    In chapter 2 of the September 2021 Preliminary TSD, DOE discussed 
that it is now aware of multiple top-loading semi-automatic clothes 
washers on the market, from multiple manufacturers. DOE stated that it 
was considering whether it should reinstate an RCW product class 
definition for top-loading semi-automatic clothes washers, and whether 
it should consider a performance-based standard rather than the design 
standard established by EPCA as amended. DOE noted, however, that 
because the user of a semi-automatic clothes washer controls the water 
temperature by adjusting the external water faucet valves, semi-
automatic clothes washers inherently provide the option for an unheated 
rinse. Therefore, DOE believes that a design standard that requires an 
unheated rinse option may be superfluous for semi-automatic clothes 
washers.
    In the September 2021 Preliminary Analysis, DOE requested comment 
on whether it should reinstate a product class definition for top-
loading semi-automatic clothes washers. DOE requested comment on its 
preliminary conclusion that that a design standard that requires an 
unheated rinse option may be superfluous for semi-automatic clothes 
washers.
    AHAM presented data indicating the shipment weighted average 
capacity for clothes washers from 1981-2020. (AHAM, No. 40 at pp. 13-
14) Based on this data, AHAM commented that a reassessment of the 
``compact'' definition would be justified since clothes washer 
capacities in general have increased from an average of 2.63 ft\3\ in 
1990 to 4.25 ft\3\ in 2020. (Id.)
    AHAM recommended that DOE change the definition of the compact 
product class in order to retain consumer utility of smaller-capacity 
and smaller-width products for consumers. (AHAM, No. 40 at pp. 13-15) 
AHAM recommended that DOE add an upper width limit of 24 inches in the 
proposed compact product class definition, such that a top-loading or 
front-loading compact product would either have a capacity less than 
1.6 ft\3\, or a width less than or equal to 24 inches. (Id.) AHAM also 
commented that typically, based on a review of retailer websites, 
products advertised as ``compact'' or ``portable'' today appear to be 
under 1.6 ft\3\ or 24 inches in width or less. (Id.) AHAM commented 
that it agrees with DOE's assessment that products with smaller widths 
and capacities provide a utility to consumers since they can be used in 
smaller spaces, can be moved more easily from place-to-place, or can be 
used together with a standard-size clothes washer. (Id.) AHAM also 
agrees with DOE's acknowledgement that these products, due to their 
smaller size, cannot achieve the same levels of efficiency as larger 
products due to technological limitations such as drum

[[Page 13539]]

diameter and capacity, or due to being geared toward niche consumer 
usage such as portability or an add-on to a standard-size clothes 
washer. (Id.)
    Whirlpool commented that it agrees with DOE's proposal to change 
the threshold for the front-loading compact product class and suggested 
that DOE make further product class changes. (Whirlpool, No. 39 at p. 
19) Whirlpool specifically suggested that DOE change the definition of 
compact clothes washers to be based on product width, corresponding to 
how they are marketed to consumers as compact or standard size. (Id.) 
Whirlpool added that clothes washers with 24-inch widths and smaller 
are overwhelmingly marketed as ``compact,'' regardless of their 
capacity. (Id.)
    Whirlpool also recommended that for standard-size clothes washers, 
DOE separate the standard-size product class into three product 
classes: standard, small (<=4.0 ft\3\); standard, medium (>4.0 ft\3\ to 
<=5.0 ft\3\); and standard, large (>5.0 ft\3\ and above). (Whirlpool, 
No. 39 at p. 19) Whirlpool commented that there are numerous 
performance, technology, efficiency, and consumer-relevant differences 
between clothes washers in Whirlpool's suggested product classes. (Id.) 
Whirlpool further explained that entry-level price point clothes 
washers generally have capacities less than or equal to 4 ft\3\ and 
that the smaller diameter wash baskets of these units create challenges 
in driving water extraction. (Id.) Whirlpool added that these clothes 
washers also have shorter cycle times and more basic feature sets and 
controls. (Id.)
    Whirlpool added that even with a removal of the capacity benefit in 
the EER and WER efficiency metrics, there are still other technological 
challenges for clothes washers with smaller cabinet widths since 
spatial limitations prevent adding technologies that increase 
efficiency, including larger motors and larger wash baskets to increase 
spin speed. (Whirlpool, No. 39 at p. 19)
    The CA IOUs commented that adjustments to increase the size of the 
front-loading compact product class are not warranted, and added that 
they are instead supportive of an equation-based metric that can 
account for the efficiency differences related to capacity. (CA IOUs, 
No. 43 at pp. 3-4) The CA IOUs added that they believe the definition 
of standard-size versus compact product classes artificially segments 
the data, and that performance is correlated with capacity without a 
clear delineation. (Id.) The CA IOUs expressed three primary concerns 
related to the changes to the product class definitions. (Id.) First, 
the CA IOUs commented that the proposed changes to capacity definitions 
would create a different definition of ``compact'' for top- and front-
loading RCWs, which the CA IOUs asserted would add confusion to the 
market. (Id.) Second, the CA IOUs commented that there likely remains 
an inherent relationship between capacity and performance in the test 
procedure, which is insufficiently represented by the two large 
discrete product class groupings of compact size and standard size. 
(Id.) The CA IOUs noted that there was significant interest from 
stakeholders in response to the August 2019 RFI for DOE to consider 
narrower capacity ranges to facilitate a separate analysis for larger 
clothes washers. (Id.) The CA IOUs commented that, while they believe 
this may result in some statistical improvement in the original 
analysis, they would prefer an equation-based standard that can correct 
for the continuum of product capacities. (Id.) The CA IOUs also 
specified that creating more narrow capacity ranges may have unintended 
consequences of incentivizing manufacturers to produce products in one 
capacity size over another due to less stringent efficiency standards 
in neighboring classes. (Id.) Third, the CA IOUs commented that while 
DOE can use capacity or another ``performance related'' feature to 
justify a higher or lower standard under EPCA, the CA IOUs expressed 
concern regarding the arbitrary nature of the capacity definitions, 
particularly for front-loading clothes washers. (Id.) The CA IOUs added 
that under the appendix J2 efficiency metrics, product efficiencies 
strongly varied with capacity and may continue to do so under the 
appendix J efficiency metrics. (Id.) The CA IOUs commented that a more 
appropriate approach would be to use an equation-based standard with a 
capacity, similar to what is used under the consumer refrigerators/
refrigerator-freezers/freezers standard. (Id.)
    Ameren et al. commented that while they do not have a specific 
recommendation for the compact RCW definition, they encourage DOE to 
ensure that changing the compact product class to incorporate larger 
capacities does not enable backsliding. (Ameren et al., No. 42 at p. 
18) Ameren et al. commented that DOE's working definition of less than 
1.6 ft\3\ for top-loading clothes washers and less than 2.5 ft\3\ for 
front-loading clothes washers would not result in backsliding because 
there is not a front-loading product less than 1.6 ft\3\ on the market. 
(Id.) However, Ameren et al. noted that, if defined differently, RCW 
models presently considered standard-sized (and therefore subject to a 
higher efficiency standard) could be recategorized as compact (and 
therefore subject to a lower efficiency standard). (Id.)
    As discussed, currently, no front-loading products with a capacity 
less than 1.6 ft\3\ are certified to DOE as being available on the 
market, indicating that the current threshold of 1.6 ft\3\ is no longer 
a relevant differentiator of capacity within the front-loading RCW 
market. DOE analysis tentatively confirms AHAM and Whirlpool's comments 
that despite the removal of the capacity ``bias'' in the EER and WER 
efficiency metrics, the reduced dimensions of smaller-width products 
limit the use of certain technologies for increasing efficiency, such 
as larger wash baskets that can exert a higher g-force on clothing. For 
this reason, DOE tentatively concludes that a separate product class is 
warranted for space-constrained front-loading RCWs at a revised 
threshold that is more relevant to the current market.
    DOE recognizes that one of the defining characteristics of front-
loading RCWs marketed as ``compact'' is the width-constrained design 
(i.e., the ability for the clothes washer to be installed in narrow 
space that would not accommodate a full-size clothes washer). DOE 
considered defining the front-loading compact-size product classes on 
the basis of width. Based on DOE's market research, and supported by 
comments from AHAM and manufacturers, products marketed as ``compact'' 
typically have a nominal cabinet width of 24-inches, whereas full-size 
products most typically have a nominal cabinet width of 27 inches. DOE 
has identified a number of practical challenges in basing the product 
class distinction on a measurement of the width of a clothes washer. 
The test procedure would need to require measuring the width of the 
clothes washer and would need to specify how the measurement would be 
performed. While DOE could consider such amendments to its test 
procedure, DOE has identified nuances in product design that could 
create complexities in defining such a measurement. For example, on 
front-loading clothes washers, DOE has observed that certain aesthetic 
features, such as the borders of the control panel, may extend beyond 
the width of the main body of the cabinet. In general, certain 
measurements of width may not provide an appropriate representation of 
product width as it relates to product class designation. DOE also 
notes that although front-loading clothes washers are most often 
marketed according to

[[Page 13540]]

their nominal width as a whole number, the actual width may be a 
fraction of an inch higher or lower than the advertised nominal width. 
Furthermore, DOE is concerned that by defining the ``compact-size'' 
threshold as a width equal to or less than 24 inches, for example, if a 
manufacturer were to bring to market a 25-inch width product, such a 
product would be defined as standard-size but would presumably share 
many of the same inherent efficiency constraints as a 24-inch product 
(i.e., a 25-inch product may be more appropriately classified as 
compact-size rather than standard-size).
    Having considered these challenges in defining the front-loading 
compact-size threshold on the basis of product width, DOE further 
considered defining the threshold based on an updated capacity value 
that would be more relevant to the current market than the existing 
threshold of 1.6 ft\3\. Based on front-loading RCW models currently 
certified in DOE's CCD, there is a gap in front-loading capacity 
between 2.8 ft\3\ and 3.4 ft\3\ (i.e., no products are available on the 
market within this range), consistent with DOE's findings presented in 
the September 2021 Preliminary TSD. DOE evaluated every front-loading 
model in the CCD and has determined that this capacity gap directly 
correlates with nominal cabinet size--capacities less than 2.8 ft\3\ 
correspond to a nominal 24-inch cabinet width, and capacities larger 
than 3.4 ft\3\ correspond to a nominal 27-inch cabinet width or 
greater. Based on this analysis, DOE tentatively concludes that for 
front-loading RCWs, using a capacity threshold rather than a width 
threshold would provide a perfectly correlated proxy for 
differentiating between standard-size products and space-constrained 
products. DOE therefore proposes to define a threshold of 3.0 ft\3\ to 
differentiate between compact-size and standard-size front-loading 
RCWs. DOE further notes that given the current gap in capacity between 
2.8 ft\3\ and 3.4 ft\3\ for units currently on the market, defining the 
threshold at 3.0 ft\3\ would provide opportunities for manufacturers to 
introduce compact-size products with slightly higher capacity, or 
standard-size products with slightly lower capacity, with such 
potential products being classified within the appropriate product 
class. DOE would consider other means for defining the threshold 
between the compact-size and standard-size front-loading product 
classes if in the future a capacity threshold were to no longer 
provides a clear proxy to distinguish between standard-size products 
and space-constrained products.
    Specific to the front-loading standard-size product class, DOE 
evaluated the merits of separately defining a larger product class 
(e.g., greater than 5.0 ft\3\), as suggested by multiple commenters. 
Data submitted by AHAM indicates a shipment-weighted average capacity 
of around 4.2 ft\3\ for all RCWs, and the results of the engineering 
analysis indicate that a capacity of 4.2 ft\3\ is representative of the 
baseline efficiency level for the standard-size front-loading product 
class. DOE's testing and teardown analysis indicates that all of the 
evaluated efficiency levels for the standard-size front-loading product 
class can be achieved by units at 4.2 ft\3\ capacity (i.e., an increase 
in capacity is not required as a means for achieving the higher 
efficiency levels analyzed). On this basis, DOE tentatively determines 
that additional capacity-based product classes within the standard-size 
front-loading product class are not warranted.
    For top-loading clothes washers, DOE proposes in this NOPR to 
maintain the existing ``compact'' and ``standard'' product class 
distinctions (i.e., using a capacity threshold of 1.6 ft\3\ to 
differentiate the two classes); however, DOE continues to consider 
alternative approaches as discussed further in the paragraphs that 
follow and in chapter 3 and chapter 5 of the NOPR TSD.
    Unlike for front-loading RCWs, top-loading compact-size products 
are available on the market at capacities less than 1.6 ft\3\ (i.e., 
the current threshold). Considering only automatic top-loading clothes 
washers,\36\ those with capacity less than 1.6 ft\3\ are exclusively 
height-constrained ``companion'' clothes washers, which are designed to 
serve as an auxiliary clothes washer for washing a small or delicate 
load while simultaneously washing a ``normal'' load in the accompanying 
standard-size RCW.\37\ Among standard-size top-loading clothes washers 
(i.e., those with capacity equal to or greater than 1.6 ft\3\), DOE's 
CCD indicates a relatively continuous spectrum of capacities available 
on the market across the entire range (i.e., no large gaps in 
capacity), with no apparent capacity threshold that closely correlates 
with product differentiation on the market.
---------------------------------------------------------------------------

    \36\ As discussed further in section IV.C.2.c of this document, 
the CCD includes both automatic clothes washer models and semi-
automatic clothes washer models certified within the top-loading 
compact product class.
    \37\ Companion clothes washers are currently available in two 
different configurations: (1) Integrated into (i.e., built into) the 
cabinet above a standard-size front-loading RCW, and (2) built into 
a pedestal drawer for installation underneath a standard-size front-
loading RCW. Both configurations are constrained in the height 
dimension.
---------------------------------------------------------------------------

    For standard-size top-loading RCWs, DOE's engineering analysis 
indicates that despite the removal of capacity ``bias'' from the EER 
and WER metrics, increases in capacity are required to achieve higher 
efficiency levels beyond EL 1. (See chapter 5 of the NOPR TSD). DOE 
continues to consider whether this conclusion justifies separating the 
standard-size product class into separate product classes, as suggested 
by Whirlpool. Given this close relationship between efficiency and 
capacity, DOE also continues to consider whether to specify an 
equation-based standard for the top-loading standard-size product 
class, as suggested by the CA IOUs. Chapter 5 of the NOPR TSD provides 
further details of DOE's consideration of these potential alternate 
product class definitions for top-loading standard-size RCWs.
    DOE recognizes that an equations-based standards approach would be 
unfamiliar to RCW stakeholders and would significantly alter the 
structure of the standards analysis. As such, the analysis of potential 
amended standards, and how such standards would impact the existing 
market, could be difficult for stakeholders to interpret, particularly 
given the proposed change in metrics to EER and WER. DOE also 
recognizes that implementing equation-based standards could potentially 
increase compliance burden from manufacturers. For example, a simple 
modification made to the balance ring on a top-loading model or the 
door shape on a front-loading model for aesthetic purposes could change 
the model's measured capacity, which would in turn change the standard 
applicable to that unit and would therefore require corresponding 
changes to the controls to reduce energy and water use. As 
manufacturers iterate product designs, any change that would affect a 
model's measured capacity would result in the model being subject to a 
different standard.
    In addition, defining an equation-based standard for only the top-
loading standard-size product class would create complexity that may 
lead to confusion or added regulatory burden for manufacturers.
    At this time, DOE tentatively determines that the increased 
complexity and potential burdens of an equation-based standard outweigh 
the benefits. As discussed, in this NOPR, DOE proposes a numerically 
based standard for the top-loading standard-size product class.

[[Page 13541]]

    In response to the CA IOUs' concern that having a different 
definition of the ``compact'' threshold for top-loading and front-
loading RCWs would add confusion to the market, DOE is proposing to 
rename the product class for top-loading RCWs with capacities less than 
1.6 ft\3\ as ``ultra-compact.''
    In response to Ameren et al.'s comment that changing the compact 
product class threshold should not enable backsliding, DOE notes that, 
as discussed, EPCA 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)) As discussed in section IV.C.2.a of this 
document, DOE used the current DOE standard applicable to front-loading 
standard-size clothes washers as the baseline efficiency level for the 
newly created front-loading compact-size product class, which prevents 
any possibility of backsliding.
    Ameren et al. provided comments pertaining to portable clothes 
washers, which the comment equates with semi-automatic clothes washers. 
(Ameren et al., No. 42 at pp. 6-8). Ameren et al. commented that since 
the last standards rulemaking, portable RCWs are now widely available 
for sale through national retailers and online direct-to-consumer 
marketplaces. (Id.) Ameren et al. referenced NEEA research as verifying 
that the portable RCWs currently on the market meet or exceed current 
standards, and that therefore they do not require a separate product 
class. (Id.) Ameren et al. also commented that nothing should prevent 
efficient technologies employed in conventional automatic top-loading 
RCWs from being leveraged in portable top-loading RCWs, including wash 
plates and higher spin speeds. (Id.)
    DOE cautions that portable clothes washers \38\ as a whole 
represent a broader category of clothes washers than semi-automatic 
clothes washers specifically. Although all semi-automatic clothes 
washers currently on the market are portable, not all portable clothes 
washers on the market are semi-automatic--certain portable clothes 
washers are automatic (i.e., they provide means for internal regulation 
of water temperature, as opposed to requiring the user to adjust the 
water temperature externally to the clothes washer).
---------------------------------------------------------------------------

    \38\ In this NOPR, DOE uses the term ``portable clothes washer'' 
to mean a clothes washer, typically with caster wheels, designed to 
be easily moved by the consumer.
---------------------------------------------------------------------------

    With regard to Ameren et al.'s comment that portable RCWs currently 
on the market meet or exceed current standards and therefore do not 
require a separate product class, DOE does not agree that this 
conclusion can be applied to semi-automatic clothes washers 
specifically, since many of the data points referenced by Ameren et al. 
correspond to automatic top-loading clothes washers. In addition, 
appendix J includes significant changes to the testing of semi-
automatic clothes washers--which improve the representativeness of the 
test results while reducing test burden--such that when tested under 
appendix J, a semi-automatic clothes washer uses significantly more hot 
water (and therefore has inherently lower EER values) than would a 
similarly-sized automatic clothes washer.\39\ Section IV.C.2.c of this 
document provides further discussion of the efficiency level analysis 
for semi-automatic clothes washers.
---------------------------------------------------------------------------

    \39\ For example, most automatic clothes washers offer only a 
cold rinse, whereas appendix J requires semi-automatic clothes 
washers to be tested on both Hot Wash/Hot Rinse, and Warm Wash/Warm 
Rinse cycles, based on the assumption that the user would not adjust 
the water temperature during the cycle. 87 FR 33316. Significantly 
more hot water is used in these cycles than on the equivalent cycles 
(Hot Wash/Cold Rinse and Warm Wash/Cold Rinse) on an automatic 
clothes washer.
---------------------------------------------------------------------------

    Given the reemergence of semi-automatic clothes washers on the 
market, and improvements to the test procedure to improve the 
representativeness of test results for semi-automatic clothes washers, 
DOE is proposing to re-establish a separate product class for semi-
automatic clothes washers and to establish performance-based standards 
for semi-automatic clothes washers.
    In summary, for this NOPR, DOE analyzed five product classes for 
RCWs as follows:

 Semi-automatic clothes washers
 Automatic clothes washers: \40\
---------------------------------------------------------------------------

    \40\ For simplicity, many of the tables in the following 
sections of this document omit the designation that these four 
product classes pertain to automatic clothes washers.
---------------------------------------------------------------------------

    [cir] Top-loading, ultra-compact (less than 1.6 ft\3\ capacity)
    [cir] Top-loading, standard-size (1.6 ft\3\ or greater capacity)
    [cir] Front-loading, compact (less than 3.0 ft\3\ capacity)
    [cir] Front-loading, standard-size (3.0 ft\3\ or greater capacity)

    DOE seeks comment on the product class structure analyzed in this 
NOPR.
2. Technology Options
    In the preliminary market analysis and technology assessment, DOE 
identified a comprehensive list of technology options that would be 
expected to improve the efficiency of RCWs, as measured by the DOE test 
procedures.\41\ Initially, these technologies encompass all those that 
DOE believes are technologically feasible.
---------------------------------------------------------------------------

    \41\ See section 3.15.2 of the September 2021 Preliminary TSD. 
Available online at www.regulations.gov/document/EERE-2017-BTSTD-0014-0030.
---------------------------------------------------------------------------

    In the September 2021 Preliminary Analysis, DOE requested 
information on any technology options not identified in the September 
2021 Preliminary TSD that manufacturers may use to attain higher 
efficiency levels of RCWs.
    Ameren et al. commented in support of DOE's inclusion of all 
relevant technologies, including those to reduce drying energy. (Ameren 
et al., No. 42 at p. 19) Ameren et al. also commented that they 
appreciate DOE's consideration of technologies that have been found in 
working prototypes in addition to those available in current models. 
(Id.)
    In this NOPR, DOE considered the technology options listed in Table 
IV.1. In addition to the technology options DOE considered for the 
September 2021 Preliminary Analysis, DOE added capacity increase as a 
technology option for this NOPR.\42\
---------------------------------------------------------------------------

    \42\ In this NOPR, DOE considers capacity increase only as a 
technology option of ``last resort.'' In defining a representative 
``path'' that manufacturers would be expected to use to achieve 
higher efficiency levels, DOE included capacity increase only for 
those efficiency levels that cannot be reasonably achieved without 
an increase in capacity. See chapter 5 of the NOPR TSD for more 
details.

     Table IV.1--Technology Options for Residential Clothes Washers
------------------------------------------------------------------------
 
-------------------------------------------------------------------------
Methods for Decreasing Water Use: *
    Adaptive water fill controls.
    Hardware features enabling lower water levels.
    Spray rinse.
    Polymer bead cleaning.
Methods for Decreasing Machine Energy:
    More efficient motor.
    Direct drive motor.
Methods for Decreasing Water Heating Energy:
    Wash temperature decrease.
    Ozonated laundering.
Methods for Decreasing Drying Energy:
    Hardware features enabling spin speed increase.
    Spin time increase.
Methods for Decreasing Standby Energy:
    Lower standby power components.
Methods for Increasing Overall Efficiency:
    Capacity increase.
------------------------------------------------------------------------
* Most of the methods for decreasing water use are also methods for
  decreasing water heating energy, since less hot water is used.


[[Page 13542]]

    Chapter 3 of the NOPR TSD includes the detailed descriptions of 
each technology option.
    DOE seeks comment on the technology options not identified in this 
NOPR that manufacturers may use to attain higher efficiency levels of 
RCWs.

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 commercially viable, existing 
prototypes will not be considered further.
    (2) Practicability to manufacture, install, and service. If it is 
determined that mass production of a technology in commercial products 
and reliable installation and servicing of the technology 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. If a technology is determined to 
have a significant adverse impact on the utility of the product to 
subgroups of consumers, or 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) Safety of technologies. 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 proprietary 
technology has proprietary protection and represents a unique pathway 
to achieving a given efficiency level, it will not be considered 
further due to the potential for monopolistic concerns.
    10 CFR part 430, subpart C, appendix A, sections 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
    In chapter 4 of the September 2021 Preliminary Analysis, DOE 
screened out electrolytic disassociation of water, ozonated laundering, 
and polymer bead cleaning on the basis of their practicability to 
install, manufacture and service. DOE also noted that electrolytic 
disassociation of water could have impacts on product utility or 
availability and that polymer bead cleaning was a unique-pathway 
proprietary technology.
    In the September 2021 Preliminary Analysis, DOE sought comment on 
whether any additional technology options should be screened out on the 
basis of any of the screening criteria.
    AHAM commented that decreasing water temperature, particularly on 
the warmest warm wash temperature, could decrease cleaning and rinsing 
performance by making it harder to remove fatty soils, which are 
soluble around 85 degrees Fahrenheit (``[deg]F''). (AHAM, No. 40 at pp. 
9-10) AHAM added that despite the existence of some detergents designed 
for lower temperatures, detergents alone cannot solve this issue. (Id.) 
AHAM commented that decreased water temperature could also have 
negative impacts on fabric care resulting from reduced detergent 
removal, biofilm accumulation, reduced particulate removal, and 
increased white residues on clothing. (Id.) AHAM also noted that if 
wash time is increased to compensate for a decrease in cleaning 
performance at lower wash temperatures, the cycle time will 
consequently increase. (Id.)
    Whirlpool suggested that lowering wash temperatures from current 
levels should not be a technology option considered by DOE. (Whirlpool, 
No. 39 at pp. 6-8) Whirlpool added that it strongly believes that wash 
temperatures are already low enough, and that lowering temperatures 
further will effectively create a disconnect between consumer 
perceptions of acceptable wash water temperatures and what Whirlpool 
could actually offer. (Id.) Whirlpool commented that this impact is 
compounded by the proposed appendix J test procedure, which proposes to 
test the hottest and coldest Warm Wash/Cold Rinse settings for all 
clothes washers instead of using the 25/50/75 test.\43\ (Id.) Whirlpool 
commented that changing the test procedure at the same time as the 
energy conservation standards may impede Whirlpool's ability to offer 
warm wash temperatures that consumers find acceptable and could affect 
clothes washers' ability to consistently clean laundry to the 
consumers' satisfaction, since higher temperatures are needed to 
effectively remove fatty soils, white residue, and particulates from 
laundry. (Id.) Whirlpool further commented that DOE's standards should 
not drive wash water temperatures below levels that are acceptable 
based on consumer perceptions of these temperatures. (Id.) Whirlpool 
recommended that instead, DOE's standards should protect the ability of 
clothes washers to offer adequate wash temperatures that align with 
consumer expectations and can deliver on the core purpose of owning and 
using a clothes washer, which is to remove soils and clean clothes. 
(Id.) Whirlpool noted that the overall impact of lowering wash 
temperature on improving efficiency is minimal in comparison to other 
technology options like improving spin speed, but it is still something 
manufacturers must consider when making tradeoffs between cost and 
efficiency when designing a clothes washer to meet new standards. (Id.)
---------------------------------------------------------------------------

    \43\ The ``25/50/75'' test refers to the provision in section 
3.5 of appendix J2 that allows a clothes washer that has four or 
more Warm Wash/Cold Rinse temperature selections to be tested at the 
25-percent, 50-percent, and 75-percent positions of the temperature 
selection device between the hottest hot (<=135 [deg]F (57.2 
[deg]C)) wash and the coldest cold wash. If a selection is not 
available at the 25-, 50- or 75-percent position, in place of each 
such unavailable selection, the next warmer temperature selection 
shall be used.
---------------------------------------------------------------------------

    Whirlpool further commented that detergents become less effective 
at lower wash temperatures, and that consumers will see this reduction 
immediately or within several loads, depending on the soil type on the 
clothing. (Whirlpool, No. 39 at p. 11) Whirlpool added that even 
detergents formulated specifically for cold water washing may not be 
validated for temperatures below 70 [deg]F. (Id.) Whirlpool noted that 
in northern states such as Michigan, yearly ground water temperatures 
are in the 42-49 [deg]F range, and that Whirlpool is not aware of any 
detergent that was formulated and validated for performance at 
temperatures that low. (Id.) Whirlpool stated that many clothes washers 
on the market today have tap cold options, and some have a variety of 
cold and cool temperatures that mix in some amount of hot water. (Id.) 
Whirlpool commented that some clothes washers offer these temperatures 
in the 55 [deg]F range. (Id.) Whirlpool expressed concern that, due to 
any amendments to the standards that necessitate a reduction in wash

[[Page 13543]]

temperatures, the temperature range of these tap cold, cold, and cool 
settings may be driven down well below the validated temperatures for 
good performance for even the best detergent formulations on the 
market. (Id.) Whirlpool added that this problem would be even more 
pronounced for the cheaper and less effective detergents, which may be 
popular with low-income consumers. (Id.) Whirlpool concluded that 
detergents would need to be reformulated to reflect this broad-scale 
lowering of wash temperatures in clothes washers, and Whirlpool is not 
sure if it would be possible to validate a detergent for good 
performance at these lower temperatures. (Id.)
    Unlike certain other discrete technology options evaluated by DOE 
(e.g., direct drive motor), wash temperature decrease can be 
implemented to varying extents. For example, some manufacturers may 
implement it to small extent (e.g., a decrease by 0.5 [deg]F), whereas 
other manufacturers may implement it to a significantly larger extent 
(e.g., a decrease of 5 [deg]F or more). In addition, DOE observes 
through testing that manufacturers employ a wide variety of ``paths'' 
to achieve higher efficiency levels--some manufacturers may opt to 
reduce wash temperatures as a means for achieving a particular 
efficiency level, whereas other manufacturers may prioritize 
maintaining wash temperatures and instead reducing motor energy use or 
drying energy. Indeed, through its testing, as discussed in a test 
report accompanying this NOPR (hereafter, the ``performance 
characteristics test report''), which is available in the docket for 
this rulemaking, DOE has observed a wide range of wash temperatures 
available on the market among products with identical efficiency 
ratings. Because of this variation in implementation from manufacturer 
to manufacturer, and because DOE observes that some manufacturers 
choose a ``path'' to higher efficiency that includes reduced wash 
temperatures, DOE has not screened out decreased wash temperatures as a 
design option for improving efficiency.
    In chapter 5 of the NOPR TSD, section 5.5.3 describes the design 
option paths most typically associated with each analyzed efficiency 
level within each product class, based on DOE's testing and teardowns 
of a representative sample of units on the market. For the top-loading 
standard-size product class, the design option path considered by DOE 
for the analysis incorporates a slight reduction in hot wash water 
temperatures at EL 3 and a more substantive reduction in hot wash water 
temperatures at EL 4, reflecting the most prevalent design option path 
used by units currently on the market at these ELs. Although the most 
typical design option path includes reduced wash temperatures, DOE's 
analysis described in the performance characteristics test report 
suggests that the proposed efficiency level (in particular, EL 3 for 
the top-loading standard-size product class) can be achieved through a 
variety of design option paths, including paths that do not require a 
substantive reduction in wash temperatures compared to the range of 
wash temperatures provided by lower-efficiency units. Such design 
option paths could incorporate more efficient motors or higher spin 
speeds, for example, in lieu of any reductions in wash water 
temperatures. Such alternate design option paths would have higher 
manufacturing costs than a path that uses reduction in wash water 
temperatures.
    Additionally, for this NOPR analysis, DOE partially screened out 
capacity increase as a technology option. Specifically, DOE screened 
out any capacity increase that would require a corresponding increase 
in cabinet width larger than 27 inches, on the basis of the 
practicability to install and service RCWs with cabinet widths larger 
than 27 inches. DOE recognizes that products with a width greater than 
27 inches may not be able to fit through many standards-size interior 
doorways.
    For the reasons discussed in chapter 4 of the NOPR TSD, for this 
NOPR analysis DOE screened out ozonated laundering, and polymer bead 
cleaning on the basis of their practicability to install, manufacture 
and service.
    DOE seeks comment on whether any additional technology options 
should be screened out on the basis of any of the screening criteria in 
this NOPR.
2. Remaining Technologies
    Through a review of each technology, DOE retained (i.e., did not 
screen out) the technology options listed in Table IV.2 and tentatively 
concludes that each of these technologies meets all five screening 
criteria to be examined further as design options.

   Table IV.2--Retained Design Options for Residential Clothes Washers
------------------------------------------------------------------------
 
-------------------------------------------------------------------------
Methods for Decreasing Water Use: *
    Adaptive water fill controls.
    Hardware features enabling lower water levels.
    Spray Rinse.
Methods for Decreasing Machine Energy:
    More efficient motor.
    Direct drive motor.
Methods for Decreasing Water Heating Energy:
    Wash temperature decrease.
Methods for Decreasing Drying Energy:
    Hardware features enabling spin speed increase.
    Spin time increase.
Methods for Decreasing Standby Energy:
    Lower Standby power components.
Methods for Increasing Overall Efficiency:
    Capacity increase (without requiring a cabinet width increase).
------------------------------------------------------------------------
* Most of the methods for decreasing water use are also methods for
  decreasing water heating energy, since less hot water is used.

    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; do not result in adverse impacts on product utility or product 
availability; do not result in adverse impacts on health or safety; and 
do not represent 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 RCWs. 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 set of cost-efficiency ``curves'' that are 
used in downstream analyses (i.e., the LCC and PBP analyses and the 
NIA).
    In this section, DOE discusses comments received in response to the 
prediction tool developed in support of the September 2021 Preliminary 
Analysis. In the sections that follow, DOE details the efficiency 
levels analyzed for each product class; the approach used to develop 
cost estimates for each efficiency level and the resulting cost-
efficiency relationship; the equations used to translate IMEF and IWF 
into EER and WER; and the

[[Page 13544]]

approach used to develop the manufacturer markup.
    In response to the September 2021 Preliminary Analysis, ASAP et al. 
commented generally in support of DOE's approach to select efficiency 
levels based on the proposed new efficiency metrics, EER and WER. (ASAP 
et al., No. 37 at p. 1)
1. Preliminary Analysis Prediction Tool
    In support of the September 2021 Preliminary Analysis, DOE tested a 
sample of RCWs under both appendix J2 and appendix J as proposed in the 
September 2021 TP NOPR. As described in chapter 5 of the September 2021 
Preliminary TSD, DOE supplemented its tested dataset with ``predicted'' 
EER and WER values for a larger sample of units. The EER and WER 
predictions which were estimated based on each model's measured 
performance under appendix J2 and on the model's physical and 
operational characteristics. DOE also published an explanation of how 
the predictive tool was developed, including a table listing the 
impacts to each underlying variable that were assumed as part of the 
predictive analysis. DOE explained that it planned to continue testing 
additional units to appendix J to increase the number of tested, rather 
than predicted, EER and WER values in future stages of the rulemaking.
    AHAM commented that DOE did not provide sufficient explanation for 
the ``prediction tool'' that DOE used to predict a clothes washer's EER 
and WER values based on appendix J2 test results. (AHAM, No. 40 at pp. 
4-6) AHAM further explained that its data, which include models 
representing approximately half of total 2020 shipments, contradicted 
the data presented in the September 2021 Preliminary TSD. (Id.) AHAM 
expressed concern that DOE did not provide any statistical outcomes to 
justify the accuracy of the prediction tool it used to predict a 
clothes washers EER and WER values based on appendix J2 test results. 
(AHAM, No. 40 at pp. 15-17) AHAM commented that without data on 
statistical outcomes, AHAM cannot assess the accuracy of the prediction 
tool. (Id.) AHAM also commented that based on the analysis that 
transposes efficiency levels, DOE's prediction tool appears to be 
inaccurate and that under the best-fit line method for front-loading 
clothes washers, the R-squared values show the prediction tool is 
insufficient. (Id.) AHAM therefore recommended that DOE update its 
analysis based on tested data instead of predicted data, especially for 
top-loading standard clothes washers with capacities less than 3.0 
ft\3\, and for front-loading compact clothes washers. (Id.) AHAM also 
requested that DOE provide appendix J2 and appendix J test data; the 
statistical data demonstrating correlation of the prediction tool; the 
data supporting the development of the tool, including the equations 
the prediction tool used; and DOE's comparison between predicted and 
tested EER where applicable. (Id.) AHAM noted that, unlike DOE, its 
data was all based on actual testing instead of using a model or 
prediction tool. (Id.)
    AHAM presented a table showing the variation in tested 
HET, MET, DET, ETLP, 
QT, and corrected RMC between appendix J2 and appendix J for 
the AHAM data, DOE data, and the combined AHAM and DOE dataset. (AHAM, 
No. 53 at pp. 7-8) AHAM measured variation by measuring the percent 
difference in each metric between appendix J2 and appendix J for all 
units, and presented an overall variation in each metric by calculating 
the average percent differences for each metric, the standard deviation 
of the percent differences for each metric, and the range of percent 
differences for each metric. (Id.) AHAM noted that on average, values 
for HET, MET, DET, ETLP, 
QT, and corrected RMC were higher under appendix J than 
under appendix J2. (Id.) AHAM also noted that the level of variation 
was particularly high for DET and ETLP. (Id.) 
AHAM commented that, while the overall impact of standby energy in the 
final calculation for energy efficiency is quite small, the impact of 
dryer energy on the final calculated efficiency is significant. (Id.) 
Based on its analysis, AHAM concluded that this variation shows that a 
direct translation between the appendix J2 and appendix J test 
procedures is not possible. (Id.) AHAM specifically pointed out that 
the total dryer energy consumption showed an average increase of 22.5 
percent, but that the range of differences with the tested models is 
quite wide, indicating that it is impossible to predict the impact of 
appendix J on dryer energy consumption. (Id.) AHAM added that the 
appendix J2 to appendix J translation has a similar effect on corrected 
RMC, and is most apparent with respect to ETLP, where 
measured values varied by as much as 221 percent. (Id.) AHAM further 
explained that the relatively high standard deviations of percent 
differences underscore the wide ranges in the measured value 
differences between appendix J2 and appendix J. (Id.)
    Samsung commented that the prediction tool used in the September 
2021 Preliminary TSD does not have a high correlation between EER and 
IMEF. (Samsung, No. 41 at p. 3)
    ASAP et al. commented that they support DOE's approach to use its 
predictive tool and that they support conducting additional testing 
using the new proposed appendix J test procedure to refine this 
approach. (ASAP et al., No. 37 at p. 1)
    Ameren et al. expressed support for DOE's approach to predict EER 
and WER values from tested IMEF and IWF value and commented that they 
support future testing with appendix J to collect more results with the 
proposed new appendix J test procedure. (Ameren et al., No. 42 at pp. 
19-20). Ameren et al. added that DOE's RMC and Warm Wash temperature 
results are consistent with findings in the 2020 NEEA report. (Id.) 
Ameren et al. added that the non-linear nature of the relationship 
between IMEF and IWF values and EER and WER values is similar to the 
non-linearity that NEEA identified in a translation of appendix J2 
tests to real-world energy use. (Id.)
    As noted, DOE stated in the September 2021 Preliminary TSD that it 
planned to continue testing additional units to appendix J to increase 
the number of tested, rather than predicted, EER and WER values for 
future stages of this proposed rulemaking.
    As described in the April 2022 NODA, DOE has tested additional 28 
additional RCW models to both appendix J2 and appendix J in order to 
provide additional data points for the translation equations and to 
eliminate the need to rely on ``predicted'' EER and WER values in the 
translation analysis. 87 FR 21816, 21817. DOE's total test sample 
includes 44 units across all five product classes analyzed for this 
NOPR. DOE made available detailed appendix J and appendix J2 test data 
for its full set of tested units as part of the April 2022 NODA. As 
discussed in section IV.C.5 of this document, for this NOPR DOE relied 
exclusively on tested data for developing translation equations for 
each automatic clothes washer product class and did not continue the 
usage of its prediction tool as part of its analysis. The 
discontinuation of the prediction tool addresses many of the concerns 
expressed by AHAM and Samsung. As detailed in section IV.C.5 of this 
document, the comprehensive dataset has enabled DOE to develop robust 
translations between the appendix J2 and appendix J metrics.
2. 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

[[Page 13545]]

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).
    For this NOPR, DOE used an efficiency-level approach, supplemented 
with the design-option approach for certain ``gap fill'' efficiency 
levels. The efficiency-level approach is appropriate for RCWs, given 
the availability of certification data to determine the market 
distribution of existing products and to identify efficiency level 
``clusters'' that already exist on the market.
    In conducting the efficiency analysis for the automatic clothes 
washer product classes, DOE first identified efficiency levels in terms 
of the current IMEF and IWF metrics defined in appendix J2 that are the 
most familiar to interested parties. DOE also initially determined the 
cost-efficiency relationships based on these metrics. Following that, 
DOE translated each efficiency level into its corresponding EER and WER 
values using the translation equations developed for each product 
class, as discussed further in section IV.C.5 of this document.
    For the semi-automatic product class, for which reliable 
certification data is unavailable, DOE tested a representative sample 
of units to appendix J and used that set of data points to determine 
the baseline and higher efficiency levels, as described further in 
section IV.C.2.c of this document.
    The efficiency levels that DOE considered in the engineering 
analysis are attainable using technologies currently available on the 
market in RCWs. DOE used the results of the testing and teardown 
analyses to determine a representative set of technologies and design 
strategies that manufacturers use to achieve each higher efficiency 
level. This information provides interested parties with additional 
transparency of assumptions and results, and the ability to perform 
independent analyses for verification. Chapter 5 of the NOPR TSD 
describes the methodology and results of the analysis used to derive 
the cost-efficiency relationships.
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 (e.g., capacity, physical size). 
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.
    In the September 2021 Preliminary Analysis, DOE presented an 
initial set of baseline levels for each product class, as shown in 
Table IV.3.

     Table IV.3--Preliminary Baseline Efficiency Levels Presented in the September 2021 Preliminary Analysis
----------------------------------------------------------------------------------------------------------------
                                                                               Minimum IMEF    Maximum IWF (gal/
               Product class                             Source             (ft\3\/kWh/cycle)     cycle/ft\3\)
----------------------------------------------------------------------------------------------------------------
Top-Loading, Compact (<1.6 ft\3\) *........  Current DOE standard.........               1.15               12.0
Top-Loading, Standard-Size (>=1.6 ft\3\)...  Current DOE standard.........               1.57                6.5
Front-Loading, Compact (<3.0 ft\3\)........  Current DOE standard for                    1.84                4.7
                                              front-loading, standard-size
                                              (>=1.6 ft\3\) **.
Front-Loading, Standard-Size (>=3.0 ft\3\).  ENERGY STAR v. 7.0 ***.......               2.38                3.7
----------------------------------------------------------------------------------------------------------------
* As discussed in section IV.A.1 of this document, DOE is proposing in this NOPR to rename the top-loading
  compact product class analyzed in the September 2021 Preliminary Analysis to top-loading ``ultra-compact.''
** Although the current DOE standard for front-loading, compact (<1.6 ft\3\) is 1.13 IMEF/8.3 IWF, no front-
  loading units are currently on the market with a capacity <1.6 ft\3\. The proposed baseline efficiency level
  reflects the currently applicable standard for front-loading RCWs with capacities between 1.6 and 3.0 ft\3\.
*** Although the current DOE standard for front-loading standard-size (>=1.6 ft\3\) is 1.84 IMEF/4.7 IWF, at the
  time of analysis, the least efficient front-loading standard-size RCW available on the market had an
  efficiency rating of 2.38 IMEF/3.7 IWF.

    Additionally, in the September 2021 Preliminary Analysis, DOE 
sought comment on whether the baseline efficiency levels identified in 
its analysis for each product class were appropriate.
    The CA IOUs presented data from their analysis of front-loading 
standard-size products available on DOE's CCD. (CA IOUs, No. 43 at pp. 
5-6) The CA IOUs commented that, according to their analysis of the 
CCD, eight models ranging from 4.3 ft\3\ to 5 ft\3\ are rated at the 
current federal minimum standard of 1.84 IMEF and 4.7 IWF, and 
recommended that DOE update the baseline definition to the current 
minimum efficiency levels to prevent an undercount of the overall 
savings potential. (Id.) The CA IOUs also identified some models rated 
at 2.92 IMEF and 4.5 IWF in the CCD, which reflects a worse IWF 
(although a better IMEF) than the baseline level analyzed in the 
September 2021 Preliminary Analysis. (Id.)
    NYSERDA commented that DOE's CCD shows front-loading standard-size 
clothes washers from 4.3 to 5.0 ft\3\ rated at the current minimum 
standard level of 1.84 IMEF. (NYSERDA, No. 36 at p. 2) NYSERDA 
recommended that DOE therefore consider the existing standard as the 
baseline for these products instead of the ENERGY STAR 2015 level of 
2.38 IMEF. (Id.)
    In response to the CA IOUs and NYSERDA's comment that the CCD 
includes standard-size front-loading clothes washers that are rated at 
the current standard level of 1.84 IMEF, DOE has determined through 
testing

[[Page 13546]]

that these units perform significantly above their rated value at the 
current standard level. DOE has also confirmed these findings through 
confidential manufacturer interviews.
    In response to the CA IOUs' comment that the CCD also includes a 
model with a worse IWF rating of 4.5 IWF, DOE notes that this unit's 
rating appears to be a typographical error. DOE notes that this unit is 
listed in the ENERGY STAR database with an IWF rating of 2.9 and a 
capacity of 4.5 ft\3\, suggesting that the capacity measurement was 
inadvertently reported as the IWF value in DOE's CCD.
    For these reasons, DOE tentatively concludes that for the standard-
size front-loading product class, the lowest available efficiency on 
the market is 2.38 IMEF and 3.7 IWF, and this level is an appropriate 
representation of baseline efficiency.
    Accordingly, in this NOPR, DOE analyzed the baseline efficiency 
levels shown in Table IV.4 for each automatic product class.\44\
---------------------------------------------------------------------------

    \44\ See section IV.C.2.c of this document for a discussion of 
efficiency levels for the semi-automatic product class.

                          Table IV.4--Baseline Efficiency Levels Analyzed in This NOPR
----------------------------------------------------------------------------------------------------------------
                                                                               Minimum IMEF    Maximum IWF (gal/
               Product class                             Source             (ft\3\/kWh/cycle)     cycle/ft\3\)
----------------------------------------------------------------------------------------------------------------
Top-Loading, Ultra-Compact (<1.6 ft\3\)....  Current DOE standard.........               1.15               12.0
Top-Loading, Standard-Size (>=1.6 ft\3\)...  Current DOE standard.........               1.57                6.5
Front-Loading, Compact (<3.0 ft\3\)........  Current DOE standard for                    1.84                4.7
                                              front-loading, standard-size
                                              (>=1.6 ft\3\) *.
Front-Loading, Standard-Size (>=3.0 ft\3\).  ENERGY STAR v. 7.0 **........               2.38                3.7
----------------------------------------------------------------------------------------------------------------
* Although the current DOE standard for front-loading compact (<1.6 ft\3\) is 1.13 IMEF/8.3 IWF, no front-
  loading units are currently on the market with a capacity <1.6 ft\3\. The proposed baseline efficiency level
  reflects the currently applicable standard for front-loading RCWs with capacities between 1.6 and 3.0 ft\3\.
** Although the current DOE standard for front-loading standard-size (>=1.6 ft\3\) is 1.84 IMEF/4.7 IWF, at the
  time of analysis, the least efficient front-loading standard-size RCW available on the has an efficiency
  rating of 2.38 IMEF/3.7 IWF.

    DOE seeks comment on whether the baseline efficiency levels 
analyzed in this NOPR for each product class are appropriate.
b. Higher Efficiency Levels
    To establish higher efficiency levels for the analysis, DOE 
reviewed data in DOE's CCD to evaluate the range of efficiencies for 
RCWs currently available on the market.\45\
---------------------------------------------------------------------------

    \45\ DOE's Compliance Certification Database is available at 
www.regulations.doe.gov/certification-data. Analysis conducted May 
2022.
---------------------------------------------------------------------------

    As part of DOE's analysis, the ``maximum available'' efficiency 
level is 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 in each product class. 
(42 U.S.C. 6295(p)(1)) DOE typically determines max-tech levels based 
on technologies that are either commercially available or have been 
demonstrated as working prototypes. If the max-tech design meets DOE's 
screening criteria, DOE considers the design in further analysis.
    DOE has tentatively determined that the max-tech efficiency level 
for each RCW product class corresponds to the maximum available level 
for each product class. In other words, DOE has not defined or analyzed 
any efficiency levels higher than those currently available on the 
market.
    As noted, EPCA requires that any new or amended energy conservation 
standard be designed to achieve the maximum improvement in energy 
efficiency that is technologically feasible. (42 U.S.C. 6295(o)(2)(A)) 
For RCWs, a determination of technological feasibility must encompass 
not only an achievable reduction in energy and/or water consumption, 
but also the ability of the product to perform its intended function 
(i.e., wash clothing) at reduced energy or water levels.\46\ Attributes 
that are relevant to consumers encompass multiple aspects of RCW 
operation such as stain removal, solid particle removal, rinsing 
effectiveness, fabric gentleness, cycle time, noise, vibration, and 
others. Each of these attributes may be affected by energy and water 
efficiency levels, and achieving better performance in one attribute 
may require a tradeoff with one or more other attributes. DOE does not 
have the means to be able to determine whether a product that uses less 
water or energy than the maximum efficiency level available on the 
market would represent a viable (i.e., technologically feasible) 
product that would satisfy consumer expectations regarding all the 
other aspects of RCW performance that are not measured by the DOE test 
procedure. As far as DOE is aware, the complexity of the 
interdependence among all these attributes precludes being able to use 
a computer model or other similar means to predict changes in these 
product attributes as a result of reduced energy and water levels. 
Rather, as far as DOE is aware, such determinations are made in an 
iterative fashion through extensive product testing as part of 
manufacturers' design processes.
---------------------------------------------------------------------------

    \46\ As an extreme example, DOE could consider a hypothetical 
RCW that reduces its water consumption to near-zero, but such a 
product would not be viable for washing clothing, given current 
technology.
---------------------------------------------------------------------------

    In the September 2021 Preliminary Analysis, for all product classes 
except top-loading compact, DOE considered efficiency levels higher 
than baseline levels based on specifications prescribed by ENERGY 
STAR[supreg] and the Consortium for Energy Efficiency (``CEE'')'s Super 
Efficient Home-Appliances Initiative,\47\ as well as gap-fill levels. 
At the time of the September 2021 Preliminary Analysis, large clusters 
of models were available at the ENERGY STAR and CEE Tier levels, as 
evident in the market distribution plots presented in chapter 3 of the 
September 2021 Preliminary TSD. At the time of the September 2021 
Preliminary Analysis, no automatic top-loading compact RCWs were 
available on the market that exceeded the baseline level. Accordingly, 
DOE did not consider any higher efficiency levels for this product 
class.
---------------------------------------------------------------------------

    \47\ CEE Super-Efficient Home Appliance Initiative available at 
cee1.org/content/cee-program-resources. Accessed July 13, 2022.
---------------------------------------------------------------------------

    In chapter 5 of the September 2021 Preliminary TSD, DOE established 
the preliminary efficiency levels for each product class as presented 
in Table IV.5 through Table IV.8.

[[Page 13547]]



  Table IV.5--Top-Loading, Compact * (<1.6 ft\3\) Preliminary Efficiency Levels, as Presented in the September
                                            2021 Preliminary Analysis
----------------------------------------------------------------------------------------------------------------
                                                                             IMEF (ft\3\/kWh/   IWF (gal/cycle/
                  EL                       Efficiency level description           cycle)             ft\3\)
----------------------------------------------------------------------------------------------------------------
Baseline..............................  Current DOE standard..............               1.15               12.0
----------------------------------------------------------------------------------------------------------------
* As discussed in section IV.A.1 of this document, DOE is proposing in this NOPR to rename the top-loading
  compact product class analyzed in the September 2021 Preliminary Analysis to top-loading ``ultra-compact.''


     Table IV.6--Top-Loading, Standard-Size (>=1.6 ft\3\) Preliminary Efficiency Levels, as Presented in the
                                       September 2021 Preliminary Analysis
----------------------------------------------------------------------------------------------------------------
                                                                             IMEF (ft\3\/kWh/   IWF (gal/cycle/
                  EL                       Efficiency level description           cycle)             ft\3\)
----------------------------------------------------------------------------------------------------------------
Baseline..............................  Current DOE standard..............               1.57                6.5
1.....................................  Gap fill..........................               1.70                5.0
2.....................................  ENERGY STAR (v. 8.1)..............               2.06                4.3
3.....................................  2015-2017 CEE Tier 1..............               2.38                3.7
4.....................................  2015 ENERGY STAR Most Efficient/                 2.76                3.5
                                         Maximum available.
----------------------------------------------------------------------------------------------------------------


  Table IV.7--Front-Loading, Compact (<3.0 ft\3\) Preliminary Efficiency Levels, as Presented in the September
                                            2021 Preliminary Analysis
----------------------------------------------------------------------------------------------------------------
                                                                             IMEF (ft\3\/kWh/   IWF (gal/cycle/
                  EL                       Efficiency level description           cycle)             ft\3\)
----------------------------------------------------------------------------------------------------------------
Baseline..............................  Current DOE standard for front-                  1.84                4.7
                                         loading, standard-size (>=1.6
                                         ft\3\).
1.....................................  ENERGY STAR v. 8.1 level for units               2.07                4.2
                                         <=2.5 ft\3\.
2.....................................  2018-2022 ENERGY STAR Most                       2.20                3.7
                                         Efficient for units <=2.5 ft\3\.
3.....................................  ENERGY STAR v. 7.0 level for units               2.38                3.7
                                         >2.5 ft\3\.
4.....................................  ENERGY STAR v. 8.1 level for units               2.76                3.2
                                         >2.5 ft\3\/Maximum available.
----------------------------------------------------------------------------------------------------------------


    Table IV.8--Front-Loading, Standard-Size (>=3.0 ft\3\) Preliminary Efficiency Levels, as Presented in the
                                       September 2021 Preliminary Analysis
----------------------------------------------------------------------------------------------------------------
                                                                             IMEF (ft\3\/kWh/   IWF (gal/cycle/
                  EL                       Efficiency level description           cycle)             ft\3\)
----------------------------------------------------------------------------------------------------------------
Baseline..............................  ENERGY STAR v. 7.0................               2.38                3.7
1.....................................  Gap fill..........................               2.60                3.5
2.....................................  ENERGY STAR v. 8.1................               2.76                3.2
3.....................................  2018-2022 ENERGY STAR Most                       2.92                3.2
                                         Efficient.
4.....................................  Maximum available.................               3.00                2.9
----------------------------------------------------------------------------------------------------------------

    DOE sought comment on whether the preliminary higher efficiency 
levels identified in the September 2021 Preliminary Analysis for each 
product class were appropriate.
    The CA IOUs, ASAP et al., and NYSERDA recommended that DOE consider 
revisiting max-tech and higher efficiency levels based on currently 
available products, for the top-loading compact product class. (CA 
IOUs, No. 43 at pp. 4-5; ASAP et al., No. 37 at p. 4; NYSERDA, No. 36 
at p. 2) These stakeholders expressed concern that DOE did not consider 
any products above the baseline levels of 1.15 IMEF and 12.0 IWF, since 
the ratings in DOE's CCD indicates top-loading compact models that 
exceed these levels. (Id.) ASAP et al. noted that DOE's CCD includes 8 
top-loading compact models with IMEF ratings between 1.24 and 1.36. 
(ASAP et al., No. 37 at p. 4) Furthermore, ASAP et al. commented that 
the new proposed test procedure could change the relative rankings and 
range of efficiency ratings for top-loading compact models. (Id.)
    DOE's CCD currently includes both automatic clothes washer models 
and semi-automatic clothes washer models certified within the top-
loading compact product class. While the certification database does 
not differentiate between automatic and semi-automatic configurations, 
DOE conducted an analysis of product literature for each certified 
model to identify the configuration of each model in the CCD. DOE's 
analysis indicates that considering only automatic top-loading compact 
clothes washers, models are available only at the baseline efficiency 
level. All of the other top-loading compact-size models in the CCD at 
higher efficiency levels are semi-automatic top-loading clothes washers 
with capacities less than 1.6 ft\3\. When evaluating only automatic 
top-loading compact clothes washers in the CCD, only products with 
baseline efficiency have been certified to DOE. Therefore, because DOE 
is not aware of any automatic top-loading compact RCWs available on the 
market at the time of this analysis that exceed the baseline level, DOE 
is not proposing any higher efficiency levels for this product class.
    Section IV.C.2.c of this document discusses the efficiency levels 
that DOE proposes for semi-automatic clothes washers.
    The CA IOUs and NYSERDA also recommended that DOE consider 
revisiting max-tech and higher efficiency levels based on currently

[[Page 13548]]

available products, for the top-loading standard-size product class. 
(CA IOUs, No. 43 at p. 5; NYSERDA, No. 36 at p. 2) These stakeholders 
commented that according to their analysis of the CCD, nine models are 
certified to lower (more efficient) IWFs than the most efficient 
considered efficiency level presented in the September 2021 Preliminary 
TSD. (Id.) The CA IOUs therefore recommended that DOE adjust the 
maximum achievable efficiency level to reflect the market availability 
of top-loading standard-size products. (CA IOUs, No. 43 at p. 5) 
NYSERDA recommended that DOE add an EL 5 using the maximum 
technologically available efficiency ratings rather than the 2015 
ENERGY STAR Most Efficient level to better reflect the constantly 
improving market. (NYSERDA, No. 36 at p. 2)
    The CA IOUs and NYSERDA also recommended that DOE consider 
revisiting max-tech and higher efficiency levels based on currently 
available products, for the front-loading standard-size product class. 
(CA IOUs, No. 43 at pp. 5-6; NYSERDA, No. 36 at p. 2) These 
stakeholders commented that the CCD contains units with higher 
efficiencies than the max-tech level DOE considered in the September 
2021 Preliminary Analysis and recommended that DOE adjust the highest 
efficiency levels to reflect the availability of these products. (Id.) 
The CA IOUs identified 11 models that surpass the IMEF and IWF maximum 
available level presented in the September 2021 Preliminary TSD, at 3.1 
IMEF and 2.7 and 2.9 IWF. (CA IOUs, No. 43 at pp. 5-6)
    In response to changes in availability on the market since the 
September 2021 Preliminary Analysis, as reflected by the models in 
DOE's CCD identified by commenters, DOE has updated the max-tech levels 
for the top-loading standard-size and front-loading standard-size 
product classes to reflect the maximum efficiency available in the CCD 
at the time of this NOPR analysis. The updated max-tech level for top-
loading standard-size is 2.76 IMEF/3.2 IWF, which DOE notes corresponds 
to the 2016/2017 ENERGY STAR Most Efficient criteria. The updated max-
tech level for front-loading standard-size is 3.10 IMEF/2.9 IWF. 
Although DOE also identified two RCW models in DOE's CCD that are rated 
at 3.10 IMEF/2.7 IWF, these units have extra-large capacity drums that 
necessitate cabinet widths greater than 27 inches. As discussed in 
section IV.B.1 of this NOPR, DOE excluded from consideration any drum 
capacities increase that require a cabinet width increase beyond 27 
inches.
    DOE also updated the definition of the top-loading standard-size 
gap-fill level (i.e., EL 1) to reflect changes in the market since 
September 2021 Preliminary Analysis. In the September 2021 Preliminary 
Analysis, DOE defined EL 1 as 1.70 IMEF/5.0 IWF based on a small 
cluster of units in DOE's CCD rated at or near that level. Subsequent 
to the September 2021 Preliminary Analysis, these units have been 
discontinued from the market and are no longer listed in DOE's CCD; in 
addition, DOE's market research indicates that the brand associated 
with these units no longer offers top-loading clothes washers for sale 
in the U.S. market. In lieu of any product offerings currently on the 
market between the baseline level (corresponding to the DOE minimum 
standard) and EL 2 (corresponding to the applicable ENERGY STAR 
criteria), in this NOPR DOE has defined EL 1 as the numerical midpoint 
between the baseline and EL 2 levels.
    Lastly, DOE updated the definition of EL 3 for the front-loading 
compact product class to better align with an existing market cluster. 
In the September 2021 Preliminary Analysis, DOE had defined EL 3 as 
2.38 IMEF/3.7 IWF, which represented the ENERGY STAR v. 7.0 level for 
units with capacity greater than 2.5 ft\3\. This resulted in a 
relatively large gap in IMEF between EL 3 and EL 4 (2.38 to 2.76 IMEF). 
For this NOPR, DOE has instead defined EL 3 as 2.50 IMEF/3.5 IWF as a 
gap fill level representing a market cluster at that point. This also 
results in EL 3 being closer to the midpoint of EL 2 and EL 4.
    In summary, for this NOPR, DOE analyzed the efficiency levels for 
each product class shown in Table IV.9 through Table IV.12.

           Table IV.9--Top-Loading, Ultra-Compact (<1.6 ft\3\) Efficiency Levels Analyzed in This NOPR
----------------------------------------------------------------------------------------------------------------
                                                                             IMEF (ft\3\/kWh/   IWF (gal/cycle/
                  EL                       Efficiency level description           cycle)             ft\3\)
----------------------------------------------------------------------------------------------------------------
Baseline..............................  Current DOE standard..............               1.15               12.0
----------------------------------------------------------------------------------------------------------------


          Table IV.10--Top-Loading, Standard-Size (>=1.6 ft\3\) Efficiency Levels Analyzed in This NOPR
----------------------------------------------------------------------------------------------------------------
                                                                             IMEF (ft\3\/kWh/   IWF (gal/cycle/
                  EL                       Efficiency level description           cycle)             ft\3\)
----------------------------------------------------------------------------------------------------------------
Baseline..............................  Current DOE standard..............               1.57                6.5
1.....................................  Gap fill..........................               1.82                5.4
2.....................................  ENERGY STAR v. 8.1................               2.06                4.3
3.....................................  2015-2017 CEE Tier 1..............               2.38                3.7
4.....................................  Maximum available (2016/2017                     2.76                3.2
                                         ENERGY STAR Most Efficient).
----------------------------------------------------------------------------------------------------------------


            Table IV.11--Front-Loading, Compact (<3.0 ft\3\) Efficiency Levels Analyzed in This NOPR
----------------------------------------------------------------------------------------------------------------
                                                                             IMEF (ft\3\/kWh/   IWF (gal/cycle/
                  EL                       Efficiency level description           cycle)             ft\3\)
----------------------------------------------------------------------------------------------------------------
Baseline..............................  Current DOE standard for front-                  1.84                4.7
                                         loading, standard-size (>=1.6
                                         ft\3\).
1.....................................  ENERGY STAR v. 8.1 level for units               2.07                4.2
                                         <=2.5 ft\3\.
2.....................................  2023 ENERGY STAR Most Efficient                  2.20                3.7
                                         for units <=2.5 ft\3\.
3.....................................  Gap fill..........................               2.50                3.5
4.....................................  Maximum available (ENERGY STAR v.                2.76                3.2
                                         8.1 level for units >2.5 ft\3\).
----------------------------------------------------------------------------------------------------------------


[[Page 13549]]


         Table IV.12--Front-Loading, Standard-Size (>=3.0 ft\3\) Efficiency Levels Analyzed in This NOPR
----------------------------------------------------------------------------------------------------------------
                                                                             IMEF (ft\3\/kWh/   IWF (gal/cycle/
                  EL                       Efficiency level description           cycle)             ft\3\)
----------------------------------------------------------------------------------------------------------------
Baseline..............................  ENERGY STAR v. 7.0................               2.38                3.7
1.....................................  Gap fill..........................               2.60                3.5
2.....................................  ENERGY STAR v. 8.1................               2.76                3.2
3.....................................  2023 ENERGY STAR Most Efficient...               2.92                3.2
4.....................................  Maximum available.................               3.10                2.9
----------------------------------------------------------------------------------------------------------------

    DOE seeks comment on whether the higher efficiency levels analyzed 
in this NOPR for each product class are appropriate.
c. Semi-Automatic
    As discussed, DOE's CCD includes both automatic clothes washer 
models and semi-automatic clothes washer models certified within the 
top-loading compact product class. While the certification database 
does not differentiate between automatic and semi-automatic 
configurations, DOE conducted an analysis of product literature for 
each certified model to identify whether each model is automatic or 
semi-automatic.
    In the September 2021 Preliminary TSD and the April 2022 NODA, DOE 
did not present any data or analysis for semi-automatic clothes 
washers. As discussed in section IV.A.1 of this document, in this NOPR, 
DOE is proposing to re-establish a separate product class for semi-
automatic clothes washers and to establish performance-based standards 
for semi-automatic clothes washers.
    As discussed previously, CCD currently includes both automatic 
clothes washer models and semi-automatic clothes washer models 
certified within the top-loading compact product class. While the 
certification database does not differentiate between automatic and 
semi-automatic configurations, DOE conducted an analysis of product 
literature for each certified model to identify the semi-automatic 
models in the CCD.
    To define the efficiency levels for analysis for the semi-automatic 
product class, DOE did not rely on any ratings currently provided in 
the CCD. As discussed in the September 2021 TP NOPR, DOE identified 
areas in which the current test procedure does not provide explicit 
instruction with regard to semi-automatic clothe washers. 86 FR 49140, 
49147. As a result, DOE stated that it recognizes that the proposed 
specifications for testing semi-automatic clothes washers in appendix J 
may differ from how manufacturers are currently testing semi-automatic 
clothes washers under appendix J2. Id. at 86 FR 49168.
    As finalized, appendix J includes significant changes to the 
testing of semi-automatic clothes washers, which improve the 
representativeness of the test results while reducing test burden. 
Given the lack of specificity in appendix J2 regarding semi-automatic 
clothes washers, and the significant differences in testing between 
appendix J2 versus appendix J for semi-automatic clothes washers, DOE 
tentatively determined that it could not develop an accurate 
correlation between appendix J2 metrics (i.e., IMEF and IWF) and 
appendix J metrics (i.e., EER and WER) for semi-automatic clothes 
washers. Therefore, in this NOPR analysis, DOE defined efficiency 
levels in terms of EER and WER directly rather than first defining 
efficiency levels in terms of IMEF and IWF and then developing 
translation equations to translate those levels to EER and WER. DOE 
defined the proposed efficiency levels for semi-automatic clothes 
washers by testing a representative sample of models on the market and 
observing the range of EER and WER results. Table IV.13 shows the 
proposed efficiency levels for the semi-automatic product class. See 
chapter 5 of the NOPR TSD for more details.

                       Table IV.13--Semi-Automatic Efficiency Levels Analyzed in This NOPR
----------------------------------------------------------------------------------------------------------------
                                                                             EER  (ft\3\/kWh/   WER  (gal/cycle/
                  EL                       Efficiency level description           cycle)             ft\3\)
----------------------------------------------------------------------------------------------------------------
Baseline..............................  Minimum available.................               1.60               0.17
1.....................................  Gap fill..........................               2.12               0.27
2.....................................  Maximum available.................               2.51               0.36
----------------------------------------------------------------------------------------------------------------

    DOE seeks comment on whether the efficiency levels analyzed in this 
NOPR for semi-automatic RCWs are appropriate.
3. 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 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 bill of materials 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 the physical 
teardown approach. For each product class, DOE tore down a 
representative sample of models spanning the entire

[[Page 13550]]

range of efficiency levels, as well as multiple manufacturers within 
each product class. DOE aggregated the results so that the cost-
efficiency relationship developed for each product class reflects DOE's 
assessment of a market-representative ``path'' to achieve each higher 
efficiency level. The resulting bill of materials provides the basis 
for the manufacturer production cost (``MPC'') estimates.
    The detailed description of DOE's determination of costs for 
baseline and higher efficiency levels is provided in chapter 5 of the 
NOPR TSD.
    Ameren et al. noted that the vast majority of RCW energy savings 
documented in the September 2021 Preliminary TSD is driven by the top-
loading standard-size product class, and recommended that DOE take a 
rigorous approach to evaluate the baseline technologies, likely 
technology pathways, and associated incremental cost for this product 
class. (Ameren et al., No. 42 at pp. 3-4) As discussed, DOE followed a 
rigorous approach to developing the cost-efficiency relationship for 
each product class.
4. Cost-Efficiency Results
    In the September 2021 Preliminary Analysis, DOE conducted teardowns 
on 31 models, which covered the entire range of efficiency levels 
within each analyzed product class.
    The preliminary baseline MPCs presented in the September 2021 
Preliminary Analysis for each product class are shown in Table IV.14.

Table IV.14--Preliminary Baseline Manufacturer Production Costs (2020$),
         as Presented in the September 2021 Preliminary Analysis
------------------------------------------------------------------------
                                                         Manufacturer
                    Product class                       production cost
------------------------------------------------------------------------
Top-Loading, Compact (less than 1.6 ft\3\ capacity)              $311.00
 *..................................................
Top-Loading, Standard-Size (1.6 ft\3\ or greater                  241.97
 capacity)..........................................
Front-Loading, Compact (less than 3.0 ft\3\                       292.85
 capacity)..........................................
Front-Loading, Standard-Size (3.0 ft\3\ or greater                410.15
 capacity)..........................................
------------------------------------------------------------------------
* As discussed in section IV.A.1 of this document, DOE is proposing in
  this NOPR to rename the top-loading compact product class analyzed in
  the September 2021 Preliminary Analysis to top-loading ``ultra-
  compact.''

    The incremental MPCs presented in the September 2021 Preliminary 
Analysis for top-loading standard-size; front-loading compact; and 
front-loading standard-size product classes are shown in Table IV.15 
through Table IV.17, respectively. As described previously, DOE did not 
analyze any higher efficiency levels for the top-loading compact 
product class in the September 2021 Preliminary Analysis since no units 
on the market exceeded the baseline level.

 Table IV.15--Preliminary Incremental Manufacturer Production Costs for Top-Loading, Standard-Size (>=1.6 ft\3\)
                 Product Class (2020$), as Presented in the September 2021 Preliminary Analysis
----------------------------------------------------------------------------------------------------------------
                             EL                                    IMEF             IWF        Incremental cost
----------------------------------------------------------------------------------------------------------------
Baseline....................................................            1.57             6.5  ..................
1...........................................................            1.70             5.0              $39.44
2...........................................................            2.06             4.3               69.34
3...........................................................            2.38             3.7              112.83
4...........................................................            2.76             3.5              115.50
----------------------------------------------------------------------------------------------------------------


   Table IV.16--Preliminary Incremental Manufacturer Production Costs for Front-Loading, Compact (<3.0 ft\3\)
                 Product Class (2020$), as Presented in the September 2021 Preliminary Analysis
----------------------------------------------------------------------------------------------------------------
                             EL                                    IMEF             IWF        Incremental cost
----------------------------------------------------------------------------------------------------------------
Baseline....................................................            1.84             4.7  ..................
1...........................................................            2.07             4.2              $17.97
2...........................................................            2.20             3.7               45.58
3...........................................................            2.38             3.7               83.81
4...........................................................            2.76             3.2               94.53
----------------------------------------------------------------------------------------------------------------


   Table IV.17--Preliminary Incremental Manufacturer Production Costs for Front-Loading, Standard-Size (>=3.0
              ft\3\) Product Class (2020$), as Presented in the September 2021 Preliminary Analysis
----------------------------------------------------------------------------------------------------------------
                             EL                                    IMEF             IWF        Incremental cost
----------------------------------------------------------------------------------------------------------------
Baseline....................................................            1.57             6.5  ..................
1...........................................................            1.70             5.0              $39.44
2...........................................................            2.06             4.3               69.34
3...........................................................            2.38             3.7              112.83
4...........................................................            2.76             3.5              115.50
----------------------------------------------------------------------------------------------------------------


[[Page 13551]]

    In the September 2021 Preliminary Analysis, DOE sought comment on 
the cost efficiency relationships developed for each product class. In 
particular, DOE sought data and information that could be used to 
further improve the determination of cost at each efficiency level.
    Ameren et al. commented that NEEA commissioned a laboratory 
engineering teardown study (``2019 NEEA Teardown''), comparing appendix 
J2 testing and teardown results of a top-loading standard-size RCW 
rated at the ENERGY STAR level with a similar top-loading standard-size 
RCW rated at the baseline level. (Ameren et al., No. 42 at pp. 13-14) 
Ameren et al. stated that the 2019 NEEA Teardown revealed the key 
difference between the two RCW models was technology that improved 
water extraction and therefore reduced drying energy. (Id.) 
Specifically, the ENERGY STAR model had a 0.4 horsepower motor, whereas 
the baseline model had a 0.33 horsepower motor, and the ENERGY STAR 
model had a slightly larger diameter pully that enabled a higher spin 
speed of 800 rpm compared to the 700 rpm of the baseline model. (Id.) 
Ameren et al. added that even though these differences resulted in 
slightly higher machine energy use for the ENERGY STAR model, the 
overall IMEF was better than the baseline model because the ENERGY STAR 
model had better water extraction capability. (Id.) Based on the data 
from the 2019 NEEA Teardown, Ameren et al. recommended that DOE 
consider an increased motor size and alternate pully ratio as a lower-
cost compliance pathway to enable higher spin speeds and lower drying 
energy sufficient to meet EL 2 as proposed in the September 2021 
Preliminary TSD. (Id.) Ameren et al. added that this lower-cost 
technology pathway may be more likely given the higher manufacturing 
cost of the significant redesign needed to employ a direct drive motor 
for compliance with EL 2. (Id.)
    As noted, DOE conducted teardowns on a wide range of top-loading 
RCWs to inform the cost-efficiency relationships presented in the 
September 2021 Preliminary Analysis and in this NOPR. DOE's analysis 
confirms Ameren et al.'s finding that reduced drying energy through 
improved water extraction is a key difference between the baseline 
level and the ENERGY STAR level (i.e., EL 2) in the top-loading 
standard-size product class. As noted by Ameren et al., DOE's teardown 
analysis conducted in support of the September 2021 Preliminary 
Analysis indicated that to achieve EL 2, manufacturers would likely 
incorporate a wash plate (sometimes also called an ``impeller''); 
direct-drive motor; spray rinse; and other hardware features to enable 
a spin speed increase. As described previously, the cost-efficiency 
relationship developed for each product class reflects DOE's assessment 
of a market-representative ``path'' to achieve each higher efficiency 
level; i.e., it does not necessarily reflect the lowest-cost pathway 
employed by a particular manufacturer. Through the breadth of models 
torn down at the baseline level and EL 2, DOE determined that the most 
typical approach currently being used by manufacturers to achieve EL 2 
is through the use of a direct-drive motor. DOE also notes that 
regardless of whether higher spin speeds are achieved through the use 
of a conventional motor or direct-drive motor, other hardware-related 
changes must also be employed to safely enable higher spin speeds. The 
cost-efficiency relationship reflects the totality of these costs.
    The CA IOUs commented that the September 2021 Preliminary TSD does 
not appear to incorporate lower standby components at any efficiency 
levels for top-loading clothes washers, despite lower standby power 
being listed in remaining design options of the screening analysis. (CA 
IOUs, No. 43 at p. 5) The CA IOUs therefore recommended that DOE 
consider adding lower standby power components as a design option for 
top-loading products when incorporating changes to its analysis. (Id.)
    Through its testing and teardowns conducted in support of the 
September 2021 Preliminary Analysis as well as this NOPR, DOE has not 
observed any consistent trend of lower-standby power components being 
used to achieve higher efficiency levels within the top-loading 
standard-size product class. As discussed, the cost-efficiency 
relationship developed for each product class reflects DOE's assessment 
of a market-representative ``path'' to achieve each higher efficiency 
level. DOE notes that given the relatively small contribution of 
standby power to the total energy measured by the test procedure, 
reducing standby power has a relatively minor impact on EER compared to 
other design options.
    AHAM commented that based on its test data, it would be challenging 
for low priced top-loading clothes washers to meet the efficiency 
levels DOE analyzed in the September 2021 Preliminary Analysis. (AHAM, 
No. 40 at p. 16) Whirlpool commented that many of the design options 
DOE suggested in the September 2021 Preliminary Analysis to reach EL 2 
would present significant challenges to manufacturers and cautioned DOE 
against considering some of these design options as viable technology 
options. (Whirlpool, No. 39 at p. 3)
    With regard to top-loading standard-size EL 2 specifically, in the 
September 2021 Preliminary Analysis, DOE indicated that the following 
design options are used: wash plate, direct-drive motor, spray rinse, 
and hardware features enabling spin speed increase. As discussed, DOE's 
identification of design options reflects DOE's observations through 
teardowns of those design options that manufacturers are currently 
employing to achieve each higher efficiency level. DOE's analyses 
consider the costs required to implement these design options as well 
as other implications that may be associated with each higher 
efficiency level.
    Ameren et al. commented that NEEA's market research identified key 
characteristics of baseline top-loading standard-size RCWs, including 
capacity, water fill control, number of programs, number of wash 
temperatures, price, and wash basket material type, based on a sample 
of 9 RCWs, representing 6 brands, and comprising 32 percent of total 
top-loading standard-size RCW sales. (Ameren et al., No. 42 at p. 3-6) 
Ameren et al. concluded that NEEA's data matched well with DOE's 
characterization of the baseline product market with one key exception: 
NEEA observed a dominance of stainless-steel wash baskets in the 
baseline market, while DOE characterizes the baseline product as having 
an enameled steel wash basket. (Id.) NEEA found that, among RCWs with a 
retail price less than $600, 64 percent of top-loading baseline 
efficiency RCWs had stainless-steel wash baskets, and that among RCWs 
with a retail price less than $500, 51 percent of RCWs had stainless-
steel wash baskets. (Id.) Given NEEA's findings, Ameren et al. 
recommended that DOE adjust the engineering analysis to include 
stainless-steel wash baskets in its characterization of the baseline 
model by either adopting a representative baseline model with a 
stainless-steel wash basket to represent the baseline top-loading 
standard-size RCWs, or developing a sales-weighted average cost of the 
top-loading RCW baseline model and a sales-weighted average incremental 
cost for EL 1 and EL 2. (Id.)
    Whirlpool also commented on the use of stainless-steel wash baskets 
as a design option. Whirlpool commented that its testing confirmed 
DOE's statement that drying energy is the largest component of overall 
efficiency

[[Page 13552]]

and stated that a faster and longer spin speed is the number one 
technology option for many clothes washer models to enable increased 
efficiency as measured using IMEF or EER. (Whirlpool, No. 39 at pp. 4-
6) Whirlpool added that for some clothes washers, increasing spin speed 
or spin time would be the only viable path to meet EL 2. (Id.) 
Whirlpool commented that using stainless-steel wash baskets instead of 
porcelain ones is a necessary technology upgrade to increase spin speed 
and spin time because porcelain tends to chip or crack at higher 
speeds, which exposes the underlying steel, which then rusts. (Id.) 
Whirlpool commented that an increase to amended standards could drive 
porcelain wash baskets out of the market and force a massive costly 
shift to stainless-steel wash baskets. (Id.) Whirlpool noted that 
clothes washers with porcelain wash baskets comprise a majority of its 
opening-price-point top-loading standard-size clothes washers, which 
are popular with consumers for their traditional look and 
affordability. (Id.) Whirlpool expressed concern that the transition to 
using stainless-steel wash baskets would lead to increased costs for 
redesign, retooling, lost sales volume, reduced margins, marketing and 
reflooring, and potential job losses, all of which may be a cost burden 
to bear by low-income consumers. (Id.)
    DOE defines a baseline model for each product class as a reference 
point against which any changes resulting from energy conservation 
standards can be measured. The baseline model in each product class 
represents the characteristics of common or typical products in that 
class. Typically, a baseline model is one that exactly meets the 
current minimum energy conservation standards. DOE's cost efficiency 
curves are intended to represent incremental costs associated with 
design options that are required in order to achieve higher efficiency 
levels above the baseline. For top-loading standard-size clothes 
washers, the faster spin speed at EL 2 requires the use of a stainless-
steel wash basket, which has higher strength than the enameled steel 
material used in baseline models. For top-loading standard-size 
products at lower efficiency levels (i.e., baseline and EL 1), 
stainless steel may be used for aesthetic purposes but is not required 
in order to operate at that efficiency level. DOE teardowns indicate 
that use of an enameled steel material is representative of a ``true'' 
baseline top-loading compact RCW, and DOE maintains this as the basis 
for its baseline manufacturing cost estimate in this NOPR. However, DOE 
notes that its industry conversion cost estimates account for the costs 
associated with transitioning the portion of the market using porcelain 
wash baskets to stainless-steel wash baskets.
    Whirlpool also commented that in addition to using a stainless-
steel wash basket, other hardware features would be needed to enable 
the higher spin speeds required under EL 2 including motor power and 
powertrain upgrades; more robust product structure such as drive 
stampings, suspension, and attachments; and components that keep noise 
and vibration levels consistent with current products. (Id.) Whirlpool 
concluded that, while DOE captured some of the design options needed to 
increase spin speed and spin time, DOE's analysis may not be 
comprehensive of the number and scale of changes needed when 
simultaneously changing the test procedure and standards. (Id.)
    Whirlpool commented that, while implementing a direct drive motor 
could use up to 50 percent less motor energy, which corresponds with 
about 5 percent less total energy, the larger savings would come from 
the increase to spin speed enabled by these new motors and powertrain 
systems. (Whirlpool, No. 39 at p. 6) Whirlpool also commented that most 
ENERGY STAR level clothes washers have a direct drive motor or more 
advanced brushless permanent magnet (``BPM'') motor, while baseline 
models typically use a permanent split capacitor (``PSC'') motor, which 
is less expensive, but is not capable of reaching higher speeds without 
tradeoffs. (Id.)
    AHAM commented that increasing spin speed and spin time will drive 
motor structure and other product design changes including larger 
counterweights in front-loading clothes washers. (AHAM, No. 40 at pp. 
9-10) AHAM further commented that increasing spin speed and spin time 
could cause increased vibration and noise, negatively impact fabric 
care due to tangling and wrinkling, and increase cycle time. (Id.)
    Whirlpool commented that more efficient spray rinses are a critical 
piece in the package of technology options needed to meet EL 2 for top-
loading standard-size clothes washers. (Whirlpool, No. 39 at p. 6) 
Whirlpool further explained that while spray rinse is already being 
used for most models, a further reduction of the amount of water used 
during spray rinses will be necessary at higher efficiency levels. 
(Id.) Whirlpool commented that changes to make spray rinse technology 
even more efficient may impact the design of dispensers and hydraulic 
components to use less water for the removal of detergent from the 
load. (Id.) Whirlpool commented that it is uncertain whether DOE has 
adequately captured these additional design considerations for spray 
rinse technology and recommended that DOE ensure that they are 
captured. (Id.)
    In response to Whirlpool and AHAM's comments regarding the costs 
associated with specific design options, DOE notes that it developed 
its cost-efficiency relationships based on comprehensive teardowns in 
which DOE physically dismantles commercially available products, 
component-by-component, to develop a detailed bill of materials for the 
product. In this regard, any ancillary components or parts that 
accompany the major design options indicated in chapter 5 of the NOPR 
TSD would also be accounted for in DOE's cost estimates. In particular, 
with regard to hardware features needed to enable higher spin speeds, 
DOE's teardown costs include the cost increases associated with motor 
structure, bearings, and counterweights. With regard to hardware 
features needed to enable spray rinse, DOE's teardown costs include the 
cost increases associated with water dispensers and tubing.
    As discussed, DOE conducted additional testing and teardowns 
following the September 2021 Preliminary Analysis. Table IV.18 shows 
the updated MPCs for each product class. Table IV.19 through Table 
IV.22 provide the incremental MPCs for each higher efficiency level for 
each product class. As discussed, no automatic top-loading compact RCWs 
are available on the market that exceed the baseline level. 
Accordingly, DOE did not consider any higher efficiency levels for this 
product class.

[[Page 13553]]



           Table IV.18--Baseline Manufacturer Production Costs
                                 [2021$]
------------------------------------------------------------------------
                                                         Manufacturer
                    Product class                       production cost
------------------------------------------------------------------------
Semi-Automatic......................................             $192.96
Top-Loading, Ultra-Compact (less than 1.6 ft\3\                   374.62
 capacity)..........................................
Top-Loading, Standard-Size (1.6 ft\3\ or greater                  272.42
 capacity)..........................................
Front-Loading, Compact (less than 3.0 ft\3\                       326.18
 capacity)..........................................
Front-Loading, Standard-Size (3.0 ft\3\ or greater                525.52
 capacity)..........................................
------------------------------------------------------------------------


             Table IV.19--Incremental Manufacturer Production Costs for Semi-Automatic Product Class
                                                     [2021$]
----------------------------------------------------------------------------------------------------------------
                             EL                                     EER             WER        Incremental cost
----------------------------------------------------------------------------------------------------------------
Baseline....................................................            1.60            0.17  ..................
1...........................................................            2.12            0.27               $5.45
2...........................................................            2.51            0.36                9.55
----------------------------------------------------------------------------------------------------------------


   Table IV.20--Incremental Manufacturer Production Costs for Top-Loading, Standard-Size (>=1.6 ft\3\) Product
                                                      Class
                                                     [2021$]
----------------------------------------------------------------------------------------------------------------
                             EL                                    IMEF             IWF        Incremental cost
----------------------------------------------------------------------------------------------------------------
Baseline....................................................            1.57             6.5  ..................
1...........................................................            1.82             5.4              $55.49
2...........................................................            2.06             4.3              108.76
3...........................................................            2.38             3.7              114.95
4...........................................................            2.76             3.5              117.90
----------------------------------------------------------------------------------------------------------------


  Table IV.21--Incremental Manufacturer Production Costs for Front-Loading, Compact (<3.0 ft\3\) Product Class
                                                     [2021$]
----------------------------------------------------------------------------------------------------------------
                             EL                                    IMEF             IWF        Incremental cost
----------------------------------------------------------------------------------------------------------------
Baseline....................................................            1.84             4.7  ..................
1...........................................................            2.07             4.2              $32.21
2...........................................................            2.20             3.7               62.07
3...........................................................            2.50             3.5               82.10
4...........................................................            2.76             3.2               84.04
----------------------------------------------------------------------------------------------------------------


     Table IV.22--Manufacturer Production Costs for Front-Loading, Standard-Size (>=3.0 ft\3\) Product Class
                                                     [2021$]
----------------------------------------------------------------------------------------------------------------
                             EL                                    IMEF             IWF        Incremental cost
----------------------------------------------------------------------------------------------------------------
Baseline....................................................            1.57             6.5  ..................
1...........................................................            1.70             5.0              $11.41
2...........................................................            2.06             4.3               19.71
3...........................................................            2.38             3.7               30.52
4...........................................................            2.76             3.5               43.64
----------------------------------------------------------------------------------------------------------------

    DOE seeks comment on the baseline MPCs and incremental MPCs 
developed for each product class.
5. Translations
    As discussed in section III.C of this document, the June 2022 TP 
Final Rule established a new test procedure, appendix J, which 
established new efficiency metrics: EER and WER. Appendix J also 
incorporates a number of revisions that affect the per-cycle energy and 
water use in comparison to results obtained under the current appendix 
J2 test procedure.
a. Preliminary Analysis Approach
    In chapter 5 of the September 2021 Preliminary TSD, DOE performed 
an initial analysis to translate the appendix J2 efficiency levels into 
appendix J efficiency levels, expressed in EER and WER. Since appendix 
J was not yet finalized at the time of publication for the September 
2021 Preliminary Analysis, DOE's initial analysis was performed using 
the version of appendix J proposed in the September 2021 TP NOPR.
    In the September 2021 Preliminary Analysis, DOE explored two 
potential methods for translating the IMEF and IWF efficiency levels 
into equivalent

[[Page 13554]]

values of EER and WER: using a best-fit line equation for each product 
class, and using a more qualitative market-cluster method. The IMEF-EER 
plots generally had lower R-squared values \48\ than the IWF-WER plots, 
indicating a weaker correlation between EER and IMEF than the 
relatively stronger correlation between WER and IWF. In particular, the 
front-loading standard-size product class had an R-squared value of 
0.08--indicating a high amount of variance around the line of best 
fit--such that the linear translation formula would not provide a 
robust prediction of how individual front-loading standard-size models 
would be rated under appendix J compared to under appendix J2. 
Conversely, the top-loading standard-size product class had a higher R-
squared value of 0.77 for the IMEF to EER translation, indicating a 
much higher degree of confidence in the prediction of how individual 
top-loading standard-size models would be rated under appendix J. Given 
the lack of strong R-squared value correlation for the front-loading 
product classes using the best-fit line method, for the September 2021 
Preliminary Analysis, DOE used a market-cluster approach to define the 
EER and WER levels corresponding to the selected IMEF and IWF 
efficiency levels.
---------------------------------------------------------------------------

    \48\ The R-squared values of each line of best fit represents 
the variability of the data around the lines of best fit. The closer 
the R-squared value is to 1.0, the more the equation of best fit is 
an accurate representation of the conversion between the two 
metrics.
---------------------------------------------------------------------------

    The translated EER and WER efficiency levels presented in the 
September 2021 Preliminary Analysis are shown in Table IV.23 through 
Table IV.26.

  Table IV.23--Top-Loading, Compact * (<1.6 ft\3\) Preliminary Efficiency Levels Analyzed in the September 2021
                                              Preliminary Analysis
----------------------------------------------------------------------------------------------------------------
                        Efficiency Level  IMEF (ft\3\/kWh/   IWF (gal/cycle/    EER (lb/kWh/      WER (lb/gal/
          EL              Description          cycle)            ft\3\)            cycle)            cycle)
----------------------------------------------------------------------------------------------------------------
Baseline.............  Current DOE                    1.15              12.0              4.26              0.33
                        standard.
----------------------------------------------------------------------------------------------------------------
* As discussed in section IV.A.1 of this document, DOE is proposing in this NOPR to rename the top-loading
  compact product class analyzed in the September 2021 Preliminary Analysis to top-loading ``ultra-compact.''


  Table IV.24--Top-Loading, Standard-Size (>=1.6 ft\3\) Preliminary Efficiency Levels Analyzed in the September
                                            2021 Preliminary Analysis
----------------------------------------------------------------------------------------------------------------
                                Efficiency level   IMEF (ft\3\/   IWF (gal/cycle/  EER (lb/kWh/    WER (lb/gal/
              EL                   description      kWh/cycle)        ft\3\)          cycle)          cycle)
----------------------------------------------------------------------------------------------------------------
Baseline......................  Current DOE                 1.57             6.5            3.73            0.42
                                 standard.
1.............................  Gap fill........            1.70             5.0            4.05            0.54
2.............................  ENERGY STAR v.              2.06             4.3            4.37            0.65
                                 8.1.
3.............................  2015-2017 CEE               2.38             3.7            4.96            0.73
                                 Tier 1.
4.............................  2015 ENERGY STAR            2.76             3.5            5.30            0.73
                                 Most Efficient/
                                 Maximum
                                 available.
----------------------------------------------------------------------------------------------------------------


  Table IV.25--Front-Loading, Compact (<3.0 ft\3\) Preliminary Efficiency Levels Analyzed in the September 2021
                                              Preliminary Analysis
----------------------------------------------------------------------------------------------------------------
                                Efficiency level   IMEF (ft\3\/   IWF (gal/cycle/  EER (lb/kWh/    WER (lb/gal/
              EL                   description      kWh/cycle)        ft\3\)          cycle)          cycle)
----------------------------------------------------------------------------------------------------------------
Baseline......................  Current DOE                 1.84             4.7            4.20            0.61
                                 standard for
                                 front-loading,
                                 standard-size
                                 (>=1.6 ft\3\).
1.............................  ENERGY STAR v.              2.07             4.2            4.49            0.66
                                 8.1 level for.
                                units <=2.5
                                 ft\3\.
2.............................  2018-2022 ENERGY            2.20             3.7            4.78            0.71
                                 STAR Most
                                 Efficient for
                                 units <=2.5
                                 ft\3\.
3.............................  ENERGY STAR v.              2.38             3.7            5.10            0.78
                                 7.0 level for.
                                units >2.5 ft\3\
4.............................  ENERGY STAR v.              2.76             3.2            5.60            0.88
                                 8.1 level for.
                                units >2.5 ft\3\/
                                 Maximum
                                 available.
----------------------------------------------------------------------------------------------------------------


 Table IV.26--Front-Loading, Standard-Size (>=3.0 ft\3\) Preliminary Efficiency Levels Analyzed in the September
                                            2021 Preliminary Analysis
----------------------------------------------------------------------------------------------------------------
                                Efficiency level   IMEF (ft\3\/   IWF (gal/cycle/  EER (lb/kWh/    WER (lb/gal/
              EL                   description      kWh/cycle)        ft\3\)          cycle)          cycle)
----------------------------------------------------------------------------------------------------------------
Baseline......................  ENERGY STAR v.              2.38             3.7            4.90            0.81
                                 7.0.
1.............................  Gap fill........            2.60             3.5            5.10            0.85
2.............................  ENERGY STAR v.              2.76             3.2            5.30            0.90
                                 8.1.
3.............................  2018-2022 ENERGY            2.92             3.2            5.60            0.90
                                 STAR Most
                                 Efficient.
4.............................  Maximum                     3.00             2.9            6.06            1.10
                                 available.
----------------------------------------------------------------------------------------------------------------


[[Page 13555]]

    In the September 2021 Preliminary Analysis, DOE sought comment on 
the EER and WER levels identified as being equivalent to the IMEF and 
IWF efficiency levels. DOE further requested data from manufacturers 
indicating the EER and WER values equivalent to the IMEF and IWF 
values, respectively, for RCW models currently on the market.
    Whirlpool commented that DOE underestimated the impacts of the 
amended test procedure on RCW efficiency and overestimated the number 
of models that could meet the EER associated with EL 2 in the September 
2021 Preliminary TSD, when tested under appendix J. (Whirlpool, No. 39 
at p. 3) Whirlpool also commented that many current ENERGY STAR 
certified RCWs meet the IMEF and IWF levels associated with preliminary 
EL 2, but would not meet the EER and WER levels defined for EL 2. (Id.) 
Whirlpool commented that this discrepancy could indicate that the 
impact of the proposed amended standards could be more severe than DOE 
analyzed. (Id.)
    AHAM commented that without a proven translation between appendix 
J2 and appendix J, DOE has no reliable means to estimate energy savings 
from its incremental ELs. (AHAM, No. 40 at p. 16) AHAM commented that 
it attempted to evaluate the accuracy of DOE's translation by comparing 
tested appendix J2 and appendix J data among clothes washers that AHAM 
tested. (Id.) AHAM presented a table comparing R-squared values for 
AHAM test data with those presented by DOE in the preliminary analysis. 
(Id.) AHAM commented that its results are consistent with DOE's 
statement that the best-fit line method is insufficient for front-
loading clothes washers. (Id.) Additionally, AHAM concluded that DOE's 
best-fit line equations show low levels of correlation between appendix 
J2 and appendix J testing, especially for top-loading standard-size and 
front-loading compact products. (Id.) AHAM therefore recommended that 
DOE update its analysis to improve the accuracy of the best-fit line 
equations and that DOE further investigate the impact of changing from 
a capacity-based test procedure to a load size-based test procedure on 
energy and water use. (Id.)
    AHAM also presented data that plotted DOE's proposed efficiency 
levels as well as EER versus WER data for the clothes washers that AHAM 
tested. (AHAM, No. 40 at pp. 16-17) Based on the data, AHAM found that 
65 percent of the top-loading standard-size RCWs it tested, which 
represent about half of top-loading standard-size clothes washer 
shipments, are less efficient than the EER/WER baseline proposed in the 
September 2021 Preliminary TSD. (Id.) AHAM similarly noted that 44.5 
percent of DOE's tested and predicted results are less efficient that 
the proposed EER/WER baseline. (Id.) AHAM therefore recommended that 
DOE shift the baseline for top-loading standard-size clothes washers so 
that it appropriately represents the least efficient clothes washers on 
the market. (Id.) AHAM suggested that DOE evaluate a gap-fill level 
between a baseline level that accounts for the RCWs that fall below 
DOE's proposed baseline level and DOE's proposed EL 1. (AHAM, No. 40 at 
p. 18) AHAM further commented that the baseline EER/WER level DOE 
proposed in the September 2021 Preliminary Analysis could serve as a 
gap-fill level. (Id.)
    AHAM commented that it is challenging for top-loading standard-size 
RCWs to reach the EER and WER levels associated with preliminary EL 2. 
(AHAM, No. 40 at pp. 17-18) Since the IMEF and IWF efficiency levels 
associated with preliminary EL 2 are the same as the current ENERGY 
STAR levels, AHAM sought to clarify that DOE should not assume that the 
current ENERGY STAR penetration values would represent the percentage 
of models or shipments that can meet EL 2 when tested under appendix J. 
(Id.)
    Regarding DOE's method to evaluate average performance among market 
clusters, AHAM commented that since DOE did not provide critical 
calculation and evaluation metrics for its results, AHAM cannot 
properly assess this approach or test the method's accuracy using 
AHAM's data. (AHAM, No. 40 at p. 16)
    AHAM commented that the models it tested represent approximately 
half of total 2020 shipments, and that its test results bring into 
question the accuracy to DOE's data. (AHAM, No. 53 at pp. 10-11) AHAM 
recommended that DOE carefully evaluate AHAM's dataset and integrate it 
with its own data in order to update its analysis. (Id.)
    ASAP et al. commented that they support DOE's approach to use the 
market cluster approach outlined in EPCA to develop efficiency levels. 
(ASAP et al., No. 37 at p. 1)
    The CA IOUs expressed concern that for the top-loading compact 
product class, the IMEF versus EER and IWF versus WER translations 
indicate opposite trends compared to the other three product classes, 
showing a negative relationship between IMEF and EER and a positive 
relationship between IWF and WER. (CA IOUs, No. 43 at p. 3)
    Following publication of the September 2021 Preliminary Analysis, 
DOE published the April 2022 NODA, which presented the results of 
additional testing conducted in furtherance of the development of the 
translations between the current test procedure and the proposed new 
test procedure. 87 FR 21816. The improved translation equations 
addressed the concerns expressed by commenters regarding the 
translations presented in the September 2021 Preliminary Analysis. The 
following section summarizes the translation approach presented in the 
April 2022 NODA.
b. NODA Approach
    In the April 2022 NODA, DOE published updated translation equations 
that were developed using data points from the 44 units it tested to 
both appendix J2 and appendix J. In a separate spreadsheet accompanying 
the April 2022 NODA and available in the rulemaking docket, DOE also 
published the underlying test results for each RCW model in its test 
sample. 87 FR 21816, 21817. The April 2022 NODA summarized analyses of 
RMC and water fill control system (``WFCS'') type, which DOE 
tentatively determined have a significant impact on these translation 
equations. Id.
    To account for the impacts of RMC, DOE developed values for 
``adjusted'' EER based on an ``adjusted'' RMC, which is equivalent to 
the RMC value measured under appendix J2 plus 4 percentage points. Id. 
To account for the difference in efficiency level correlation between 
clothes washers with automatic and manual WFCS, DOE presented an 
alternate set of translation equations that separate top-loading 
portable RCWs (which use manual WFCS) from top-loading stationary RCWs 
(which provide either automatic WFCS or both manual and automatic 
WFCSs). 87 FR 21816, 21820.
    The following sections summarize the adjusted RMC approach 
presented in the April 2022 NODA. As discussed previously, RMC is a 
significant contributor to both the IMEF and EER metrics. The approach 
presented in the April 2022 NODA provides the foundation for the 
approach used for this NOPR, as discussed further in section IV.C.5.c 
of this document.
i. Adjusted RMC
    The following paragraphs explain the difference in RMC measurement 
methodology between appendix J2 and appendix J. This difference in 
methodology underlies DOE's careful consideration of RMC in developing 
the metric translation equations.

[[Page 13556]]

    As discussed, the RMC is a measure of the amount of water remaining 
in the clothing load after completion of the clothes washer cycle. The 
RMC value is used to calculate the total per-cycle energy consumption 
for removal of moisture from the clothes washer test load in a clothes 
dryer to an assumed final moisture content, i.e., the ``drying 
energy,'' which is one of the factors contained within both the IMEF 
and EER metrics. Lower values of RMC result in less drying energy and 
thus represent more-efficient performance.
    Section 3.8.2 of appendix J2 requires that the RMC be calculated 
based on a test run with the maximum load size on the Cold Wash/Cold 
Rinse (``Cold/Cold'') temperature selection. Section 3.8.4 of appendix 
J2 requires that for clothes washers that have multiple spin settings 
\49\ available within the energy test cycle that result in different 
RMC values, the maximum and minimum extremes of the available spin 
settings must be tested with the maximum load size on the Cold/Cold 
temperature selection.\50\ In this case, the final RMC is the weighted 
average of the maximum and minimum spin settings, with the maximum spin 
setting weighted at 75 percent and the minimum spin setting weighted at 
25 percent.
---------------------------------------------------------------------------

    \49\ The term ``spin settings'' refers to spin times or spin 
speeds. The maximum spin setting results in a lower (better) RMC.
    \50\ On clothes washers that provide a Warm Rinse option, 
appendix J2 requires that RMC be measured on both Cold Rinse and 
Warm Rinse, with the final RMC calculated as a weighted average 
using TUFs of 73 percent for Cold Rinse and 27 percent for Warm 
Rinse. DOE has observed very few RCW models on the market that offer 
Warm Rinse. For simplicity throughout this discussion, DOE 
references the testing requirements for clothes washers that offer 
Cold Rinse only.
---------------------------------------------------------------------------

    In contrast, appendix J requires measuring RMC on each of the 
energy test cycles (i.e., each load size and each wash/rinse 
temperature combination included for testing) using the default spin 
setting. On some clothes washers, the default spin setting is not the 
maximum spin setting. In section 4.3 of appendix J, the final RMC is 
calculated by weighting the individual RMC measurements using the same 
temperature and load size weighting factors that apply to the water and 
energy measurements.
    As discussed in the April 2022 NODA, multiple factors can affect 
the RMC of a particular cycle, including the spin speed and the 
duration of the spin portion of the wash cycle. 87 FR 21816, 21818. The 
size of the load can also affect RMC--generally, larger load sizes 
result in lower (better) RMC values, whereas smaller load sizes result 
in higher (worse) RMC values. Id. These factors result in different 
measured RMC values for appendix J and appendix J2, specifically 
because under appendix J, RMC is measured across a wider range of 
cycles (compared to only the Cold/Cold cycle in appendix J2) and 
because the appendix J load sizes are smaller than the appendix J2 
maximum load size (on which the appendix J2 RMC measurement is based). 
Id.
    In the interest of improving the translation equations as presented 
in the September 2021 Preliminary Analysis, DOE conducted an in-depth 
analysis of the differences in RMC between the appendix J2 and proposed 
appendix J test procedures. Id. For each unit that DOE tested, DOE 
examined the cycle-by-cycle test results to determine the key driver 
behind the difference in RMC when testing to appendix J as compared to 
appendix J2. Id. Based on this analysis, DOE identified three 
categories of spin implementations that result in differences between 
the appendix J RMC value and the appendix J2 RMC value, described as 
follows.
     The first type, referred to as ``consistent spin'' 
throughout the remainder of this NOPR, is illustrative of units in 
which the characteristics of the spin cycle (e.g., spin speed, spin 
time) are consistent across temperature selections. On these units, RMC 
values measured on Warm/Cold, Hot/Cold, and Extra Hot/Cold cycles are 
substantially similar to the RMC value measured on the Cold/Cold 
cycle.\51\
---------------------------------------------------------------------------

    \51\ DOE notes that the ``consistent spin'' designation is not 
meant to exclude clothes washers that offer multiple spin speed 
settings on the Normal cycle. Rather, the term ``consistent'' refers 
to a particular spin speed setting demonstrating substantially 
similar performance regardless of which wash/rinse temperature is 
selected.
---------------------------------------------------------------------------

     The second type, referred to as ``Cold/Cold optimized 
spin'' throughout the remainder of this NOPR, is illustrative of units 
in which the spin cycle is optimized on the Cold/Cold setting with 
maximum load size, corresponding to the one cycle combination for which 
RMC is measured under appendix J2. On these units, the spin portion of 
the cycle is significantly faster or longer on either the Cold/Cold 
setting, when using a maximum load size, or both as compared to the 
other temperature settings or load sizes that are tested as part of the 
energy test cycle.
     The third type, referred to as ``non-default maximum 
spin'' throughout the remainder of this NOPR, is illustrative of units 
in which the maximum spin speed setting (which is tested under appendix 
J2) is not the default spin speed setting on the Normal cycle. On these 
units, the default spin speed setting tested under appendix J would 
provide a lower-speed spin or a shorter spin portion of the cycle. Id.
    For clothes washers with ``consistent spin,'' the only source of 
difference between the measured RMC values under appendix J and 
appendix J2 is the use of smaller load sizes for appendix J. Id. The 
observed difference in RMC between the two test procedures is 
relatively consistent among models from different manufacturers of RCWs 
with this characteristic, as discussed further in this section. Id.
    For clothes washers with ``Cold/Cold optimized spin'' the 
difference between the measured RMC values under appendix J and 
appendix J2 is due to a combination of both the smaller load sizes for 
appendix J and the different spin behavior on the temperature settings 
other than Cold/Cold. Id. The observed difference in RMC between the 
two test procedures varies significantly among models from different 
manufacturers of RCWs with ``Cold/Cold optimized spin,'' depending on 
the degree to which the Cold/Cold RMC differs from the RMC on all other 
tested cycles. Id.
    For clothes washers with ``non-default maximum spin,'' the 
difference between the measured RMC values under appendix J and 
appendix J2 is due to a combination of both the smaller load sizes for 
appendix J and the different spin behavior on the maximum and default 
spin settings. Id. Similar to units with ``Cold/Cold optimized spin,'' 
the observed difference in RMC between the two test procedures varies 
significantly among models from different manufacturers of RCWs with 
``non-default maximum spin,'' depending on the degree to which the 
maximum spin setting differs from the default spin setting. Id.
    As discussed, the RMC value is the most significant contributor to 
both the IMEF metric measured by appendix J2 and the EER metric 
measured by appendix J. Id. Because of the more significant variation 
in RMC between the two test procedures for ``Cold/Cold optimized spin'' 
and ``non-default maximum spin'' units, the correlation between IMEF 
and EER for these units is less strong (i.e., lower ``R-squared'' 
values for the best-fit line) than for ``consistent spin'' units. Id. 
at 87 FR 21819.
    To investigate strategies for defining translation equations with a 
stronger correlation between IMEF and EER, DOE developed a second set 
of EER values based on an ``adjusted'' RMC value (substituted for the 
measured RMC value) that assumes a ``consistent spin'' characteristic 
for each unit in the

[[Page 13557]]

test sample. Id. Under this approach, only the change in load size 
would be assumed to impact the RMC values measured under appendix J as 
compared to appendix J2. Id. DOE's test data indicated that the smaller 
load sizes under appendix J result in an increase in RMC of 4 
percentage points compared to the RMC values measured under appendix J2 
using the maximum load size. Id. Therefore, for this approach, DOE 
calculated an ``adjusted RMC'' for each unit as the tested RMC value 
under appendix J2 plus 4 percentage points. Id. DOE substituted this 
adjusted RMC for the RMC value in the drying energy equation within the 
EER calculation. Id. As demonstrated in the second set of ``adjusted'' 
translation plots, this approach produced translation equations with 
significantly higher R-squared values, indicating a stronger 
correlation between IMEF and EER. Id.
    Comments submitted by a manufacturer in response to the September 
2021 NOPR suggested that, were DOE to amend standards based on appendix 
J as proposed, manufacturers that currently use ``Cold/Cold optimized 
spin'' or ``non-default maximum spin''--which yield lower (i.e., 
better) RMC values on the Cold/Cold temperature setting compared to RMC 
values obtained using the other temperature settings for RCWs with 
``Cold/Cold optimized spin,'' and on the maximum spin setting for RCWs 
with ``non-default maximum spin''--would likely implement similar 
strategies to decrease the RMC across all cycles required for testing 
under appendix J. (EERE-2016-BT-TP-0011, Whirlpool, No. 26 at p. 8-9). 
Specifically, for ``Cold/Cold optimized spin'' units, manufacturers 
would likely increase the spin speeds or spin durations across all 
temperature settings to match the spin behavior of the Cold/Cold 
temperature setting. For ``non-default maximum spin'' units, 
manufacturers would likely make the maximum spin speed the default spin 
setting to provide the lowest possible (i.e., best possible) RMC 
measurement under appendix J.
    In response to stakeholder questions, DOE published a supplemental 
data report providing additional details as to how it calculated an 
average increase in RMC of 4 percentage points due to the smaller load 
sizes defined in appendix J.\52\ DOE investigated two separate methods 
for determining the impact of test load size on RMC. Both methods 
yielded nearly identical results, as described in the following 
paragraphs.
---------------------------------------------------------------------------

    \52\ Available at www.regulations.gov/document/EERE-2017-BT-STD-0014-0048.
---------------------------------------------------------------------------

    For Method 1, DOE compared the final corrected RMC values obtained 
under both test procedures for only those units that DOE designated as 
having a ``consistent spin'' spin implementation. As described, units 
designated as ``consistent spin'' demonstrate key characteristics of 
the spin cycle (e.g., spin speed, spin time) that are consistent across 
temperature selections; as such, DOE expects that for these units, the 
difference between the two final RMC values is due primarily to the 
difference in load sizes between the two test procedures. Among all the 
``consistent spin'' units in the test sample, appendix J yielded a 
final RMC value 3.7 percentage points higher than appendix J2, on 
average.
    For Method 2, DOE measured and compared the cycle-specific 
corrected RMC values for only the following specific Cold/Cold cycles: 
the appendix J2 Cold/Cold cycle with a maximum load size and default 
spin settings; the appendix J Cold/Cold cycle with a large load size 
and default spin settings; and the appendix J Cold/Cold cycle with a 
small load size and default spin settings. These three cycles differ 
only in load size, such that the differences between the RMC values are 
due primarily to the difference in load sizes.
    DOE first calculated the average RMC value of these two appendix J 
cycles (consistent with the equivalent load weighting factors for the 
large and small load sizes defined by appendix J) and compared the 
resulting value to the RMC value for this appendix J2 cycle. Among all 
the units in the test sample, this approach indicated that the average 
of the large and small load sizes under appendix J yielded a final RMC 
value 3.8 percentage points higher than the maximum load size under 
appendix J2, on average.
    In summary, the results from both Method 1 and Method 2 suggest 
that the smaller load sizes under appendix J result in an increase in 
RMC of approximately 4 percentage points, on average, compared to the 
RMC values measured under appendix J2 using the maximum load size.
    In the April 2022 NODA, DOE requested comment on whether, if DOE 
were to establish amended RCW standards based on appendix J as 
proposed, manufacturers that currently use the ``Cold/Cold optimized 
spin'' strategy for their RCWs would modify the spin behavior across 
all temperature settings to match the spin behavior of the Cold/Cold 
temperature setting; and whether manufacturers that currently use the 
``non-default maximum spin'' strategy for their RCWs would design the 
maximum spin speed to be the default spin setting. DOE further 
requested comment on the impact of such changes to the energy and water 
use, other aspects of consumer-relevant performance, and life-cycle 
cost of RCWs. 87 FR 21816.
    The CA IOUs commented that all three of the spin strategies 
identified by DOE are currently on the market, and that identification 
of these three types of RMC strategies implemented in products 
currently on the market shows the value that appendix J will provide, 
in contrast to products optimized for the appendix J2 test rather than 
what the CA IOUs characterized as ``real-world'' operation. (CA IOUs, 
No. 52 at pp. 1-2)
    According to ComEd and NEEA, NEEA's testing of 12 clothes washers 
representing more than 20 percent of sales from May 2018 to April 2019 
confirms DOE's three spin implementation types for stationary RCWs; 
therefore, ComEd and NEEA encouraged DOE to continue to use these spin 
profiles. (ComEd and NEEA, No. 50 at p. 3)
    ComEd and NEEA commented that they agree with DOE's assumption that 
manufacturers will likely maintain a similar measured efficiency of 
RCWs with the transition to appendix J, and they support DOE's 
assumption that manufacturers will modify RCWs to spin consistently 
across all cycles tested, enabling a comparable RMC and drying energy 
under appendix J. (ComEd and NEEA, No. 50 at pp. 2-4) According to 
ComEd and NEEA, most RCWs have a delicate wash program that consumers 
can use for textiles that may not be able to withstand higher spin 
speeds or longer spin durations, such that ComEd and NEEA do not expect 
changes to RMC as a result of appendix J to impact RCW utility. (Id.) 
For these reasons, ComEd and NEEA supported DOE's approach to 
developing the adjusted appendix J efficiency values proposed in the 
April 2022 NODA and encouraged DOE to employ the adjusted appendix J 
efficiency values to develop future candidate standards levels for RCW. 
(Id.)
    ASAP et al. expressed support for DOE's April 2022 NODA approach to 
develop a more robust translation of RCW energy and water usage metrics 
from the current appendix J2 to the new appendix J test procedure. 
(ASAP et al., No. 51 at pp. 1-2) Specifically, ASAP et al. expressed 
support for the approach of developing translations and resulting ELs 
based on adjusted RMC given the significant impact of RMC on overall

[[Page 13558]]

energy usage and resulting efficiency ratings. (Id.) ASAP et al. 
commented that given Whirlpool's comments suggesting that manufacturers 
with RCWs optimized for the appendix J2 spin settings would likely re-
program these units to perform better when tested under new appendix J, 
ASAP et al. find it reasonable to assume that manufacturers would 
modify RCW spin settings if DOE were to establish amended standards 
based on the new appendix J. (Id.)
    AHAM commented in response to the September 2021 Preliminary 
Analysis that DOE's proposed changes to the load sizes in new appendix 
J would lead to an increase in RMC. (AHAM, No. 40 at pp. 9-10) AHAM 
noted that accordingly, manufacturers would need to increase spin speed 
and spin times to compensate for this change so that they continue to 
comply with future energy conservation standards. (Id.)
    In response to the April 2022 NODA, AHAM presented data that 
examined the corrected RMC of units with ``consistent spin,'' including 
units that were tested by both AHAM and DOE. (AHAM, No. 53 at pp. 8-10) 
AHAM's data presented RMC for each unit as tested to appendix J2 and 
appendix J, and the difference between those values for each unit. 
(Id.) AHAM noted that when only considering units tested by AHAM, the 
average difference in RMC is 5.9 percent,\53\ as opposed to the 3.7 
percent average RMC difference calculated when only using the units in 
DOE's test sample from the April 2022 NODA. (Id.) AHAM also noted that 
when the AHAM and DOE datasets are combined, the average RMC difference 
is 4.7 percent. (Id.) AHAM commented that the difference in averages 
show that average RMC difference is subject to changes in sample 
content and size. (Id.) AHAM also commented that the range of RMC 
differences is wide. (Id.) AHAM noted that DOE's sample ranges from -
1.6 to 11.3 percent difference, AHAM's sample ranges from -1.0 percent 
to 16.4 percent difference, and the combined sample has a range of -1.6 
to 16.4 percent difference. (Id.) AHAM further commented that the 
models were well-distributed throughout the range and that the end 
points of this range are not outliers. (Id.)
---------------------------------------------------------------------------

    \53\ DOE uses the term ``percent'' in this context to refer to 
RMC percentage points.
---------------------------------------------------------------------------

    AHAM commented that due to the wide range of differences in RMC 
between appendix J2 and appendix J testing among units in AHAM's and 
DOE's test samples, in AHAM's opinion, the average is not 
representative of the range of differences in the data. (AHAM, No. 53 
at p. 10) AHAM also added that the average difference in RMC is highly 
susceptible to change depending on which and how many units are 
included in the dataset, which demonstrates that the average is not a 
reliable value for determining an ``adder'' to account for design 
optimization to the new test procedure. (Id.) AHAM commented that 
without a proven translation between appendix J2 and appendix J, DOE 
has no reliable means to estimate energy savings from its incremental 
efficiency levels until it can conduct testing or receive test data to 
assist in re-establishing the baseline. (Id.)
    AHAM commented that without a finalized test procedure to consider 
during the majority of the April 2022 NODA comment period and during 
the September 2021 Preliminary Analysis comment period, it was 
impossible to evaluate the percentage that would be appropriate for RMC 
adjustment, when the test procedure could change from DOE's proposal. 
(AHAM, No. 53 at p. 12) AHAM commented that even if an RMC adjustment 
is an appropriate approach for developing a translation between 
appendix J2 and appendix J, it does not change the overall concerns 
AHAM has with appendix J. (Id.) AHAM recommended that, now that DOE has 
finalized the test procedure, DOE should collect data to determine 
whether a translation equation or adjustment factor are possible and, 
if not, collect data to reestablish the baseline. (Id.)
    AHAM further commented that without a proven translation between 
appendix J2 and appendix J, DOE has no reliable means to estimate 
energy savings from its incremental efficiency levels until it can 
conduct testing or receive test data to assist in re-establishing the 
baseline. (AHAM, No. 53 at p. 10) AHAM also commented that DOE needs to 
further investigate the impact of the change from capacity-based 
efficiency metrics to load-size based efficiency metrics. (Id.)
    In response to AHAM's comment regarding the specific value of the 
``adjusted'' RMC adder determined in the April 2022 NODA, DOE has 
closely reviewed AHAM's RMC data to understand the reason for the 
larger average difference between the test procedures than was observed 
in DOE's data. DOE also closely re-examined its own data, as presented 
in appendix 5A of the NOPR TSD. The following paragraphs summarize 
DOE's key conclusions from this analysis.
    DOE notes that in both datasets, any differences above 10 percent 
appear to be outliers, as evidenced by a large gap in data points 
between 6 percent and 11 percent (whereas the data points less than 6 
percent are fairly evenly distributed around the mean of 4 percent).
    DOE re-evaluated the unit in its test sample with an RMC difference 
of 11.1 percent. Upon closer examination, DOE determined that this unit 
was incorrectly characterized in the April 2022 NODA as having a 
``consistent spin'' spin implementation. Upon closer examination of the 
time series power data for each cycle, this unit exhibits ``Cold/Cold 
optimized spin'' behavior and therefore should be excluded from 
consideration for the purpose of determining an RMC adjustment factor 
based on load size differences alone. Although DOE does not have access 
to the time series power data underlying AHAM's data submission, DOE's 
determination that the outlier unit in DOE's test sample was 
incorrectly categorized suggests that the outlier units in AHAM's 
sample may also be incorrectly categorized as having ``consistent 
spin'' spin implementation. As discussed, given the large gap in data 
points between 6 percent and 11 percent, and given DOE's determination 
that it had incorrectly categorized its unit at 11 percent, DOE 
tentatively determines that the outlier data points above 11 percent 
very likely do not represent units with ``consistent spin'' spin 
implementation and therefore should be excluded from the analysis to 
determine an RMC adjustment factor based on load size differences 
alone.
    Excluding such data points, DOE notes that the revised mean of 
DOE's dataset would be 3.4 percent. Excluding the values 12.1, 15.8, 
and 16.3 from AHAM's dataset, the revised mean would be 3.7 percent. 
Considering both datasets together, the revised mean of the joint 
dataset would be 3.5 percent.
    Based on this analysis, DOE tentatively determines that a 4-
percentage-point adder (rounded to the nearest whole number) provides a 
representative estimate of the change in RMC between the two test 
procedures due to only the change in load size. In this NOPR, DOE 
maintains use of the 4-percentage-point adder to calculate ``adjusted 
RMC'' for the purposes of developing translation equations.
ii. NODA Translation Equations
    In the April 2022 NODA, DOE presented several versions of the 
translation equations that DOE could consider using to define potential 
higher efficiency levels based on the new EER and WER metrics. In 
particular, for the top-loading standard-size product class, DOE 
presented potential translations based on data points for all

[[Page 13559]]

configurations as well as separate translations specific to stationary 
units with automatic WFCS and portable units with manual WFCS.
    In response to the April 2022 NODA, AHAM presented data showing the 
R-squared values for the translation equations developed using DOE's 
data from the April 2022 NODA and using AHAM's data. (AHAM, No. 53 at 
p. 11) AHAM commented that the R-squared value for ``top-loading, 
standard, all configurations'' is very low, and that there is not a 
meaningful improvement using the adjusted RMC approach using DOE's data 
alone, or the combined AHAM and DOE dataset. (Id.)
    AHAM commented that it understands that DOE's 4-percent adjustment 
in RMC was developed only to account for changes in tested spin speeds 
between appendix J2 and appendix J. (AHAM, No. 53 at p. 11) However, 
AHAM noted that there could be other design changes manufacturers would 
employ to account for the new test procedure. (Id.) AHAM added that DOE 
indicated that it did not consider other potential design changes. 
(Id.) AHAM added that it is inappropriate for a test procedure to drive 
design changes in and of itself. (Id.)
    AHAM commented that it does not believe at this time that the 
translation equation can adequately address all models or changes in 
the test procedure to serve as a replacement for reestablishing the 
baseline through test data. (Id.) AHAM recommended that should DOE 
pursue a translation equation despite AHAM's comments that doing so is 
not supported by available data, DOE should consider design changes 
other than spin speed because spin speeds are not the only thing 
manufacturers will need to change in product design due to the new test 
procedure. (Id.)
    DOE acknowledged in the April 2022 NODA that for the top-loading 
standard-size product class, each of the separate translation equations 
has a stronger correlation (i.e., higher R-squared value) than the 
single translation equation in which top-loading portable and top-
loading stationary products are combined. 87 FR 21816, 21820. DOE notes 
that the combined dataset for the top-loading standard-size sample 
contained 12 stationary units (representing 71 percent of the sample) 
and 5 portable units (representing 29 percent of the sample). Shipment 
data submitted by AHAM indicates that top-loading portable clothes 
washers represent approximately 1 percent of the top-loading market. 
This indicates that the portable configuration was significantly over-
sampled within the combined dataset.
    For this NOPR, DOE proposes to use datapoints representing only 
stationary units to develop the translation equations for the top-
loading standard-size product class, on the basis that these units' 
characteristics are significantly more representative of the market 
than the portable configuration. Appendix 5A of the NOPR TSD provides 
further details and discussion of the development of the translation 
equations for this NOPR.
c. NOPR Approach
    For this NOPR, DOE used the ``adjusted EER'' approach presented in 
the April 2022 NODA to define the translation between the appendix J2 
and appendix J metrics for this NOPR. Additionally, as discussed 
further in appendix 5A of the NOPR TSD, DOE used AHAM's dataset to 
confirm the accuracy and appropriateness of these translation 
equations. Table IV.27 through Table IV.30 show the efficiency level 
translations considered in this NOPR based on the updated efficiency 
metric translations presented in chapter 5 of the NOPR TSD.

               Table IV.27--Top-Loading, Ultra-Compact (<1.6 ft\3\) Efficiency Level Translations
----------------------------------------------------------------------------------------------------------------
                        Efficiency level  IMEF (ft\3\/kWh/   IWF (gal/cycle/    EER (lb/kWh/      WER (lb/gal/
          EL              description          cycle)            ft\3\)            cycle)            cycle)
----------------------------------------------------------------------------------------------------------------
Baseline.............  Current DOE                    1.15              12.0              3.79              0.29
                        standard.
----------------------------------------------------------------------------------------------------------------


               Table IV.28--Top-Loading, Standard-Size (>=1.6 ft\3\) Efficiency Level Translations
----------------------------------------------------------------------------------------------------------------
                        Efficiency level  IMEF (ft\3\/kWh/   IWF (gal/cycle/    EER (lb/kWh/      WER (lb/gal/
          EL              description          cycle)            ft\3\)            cycle)            cycle)
----------------------------------------------------------------------------------------------------------------
Baseline.............  Current DOE                    1.57               6.5              3.50              0.38
                        standard.
1....................  Gap fill.........              1.82               5.4              3.89              0.47
2....................  ENERGY STAR v.                 2.06               4.3              4.27              0.57
                        8.1.
3....................  2015-2017 CEE                  2.38               3.7              4.78              0.63
                        Tier 1.
4....................  Maximum available              2.76               3.2              5.37              0.67
                        (2016/2017
                        ENERGY STAR Most
                        Efficient).
----------------------------------------------------------------------------------------------------------------


                 Table IV.29--Front-Loading, Compact (<3.0 ft\3\) Efficiency Level Translations
----------------------------------------------------------------------------------------------------------------
                        Efficiency level  IMEF (ft\3\/kWh/   IWF (gal/cycle/    EER (lb/kWh/      WER (lb/gal/
          EL              description          cycle)            ft\3\)            cycle)            cycle)
----------------------------------------------------------------------------------------------------------------
Baseline.............  Current DOE                    1.84               4.7              4.41              0.53
                        standard for
                        front-loading,
                        standard-size
                        (>=1.6 ft\3\).
1....................  ENERGY STAR v.                 2.07               4.2              4.80              0.62
                        8.1 level for
                        units <=2.5
                        ft\3\.
2....................  2023 ENERGY STAR               2.20               3.7              5.02              0.71
                        Most Efficient
                        for units <=2.5
                        ft\3\.
3....................  Gap fill.........              2.50               3.5              5.53              0.75
4....................  Maximum available              2.76               3.2              5.97              0.80
                        (ENERGY STAR v.
                        8.1 level for
                        units >2.5
                        ft\3\).
----------------------------------------------------------------------------------------------------------------


[[Page 13560]]


              Table IV.30--Front-Loading, Standard-Size (>=3.0 ft\3\) Efficiency Level Translations
----------------------------------------------------------------------------------------------------------------
                        Efficiency Level  IMEF (ft\3\/kWh/   IWF (gal/cycle/    EER (lb/kWh/      WER (lb/gal/
          EL              Description          cycle)            ft\3\)            cycle)            cycle)
----------------------------------------------------------------------------------------------------------------
Baseline.............  ENERGY STAR v.                 2.38               3.7              5.02              0.64
                        7.0.
1....................  Gap fill.........              2.60               3.5              5.31              0.69
2....................  ENERGY STAR v.                 2.76               3.2              5.52              0.77
                        8.1.
3....................  2023 ENERGY STAR               2.92               3.2              5.73              0.77
                        Most Efficient.
4....................  Maximum available              3.10               2.9              5.97              0.85
----------------------------------------------------------------------------------------------------------------

d. Alternative Approaches
    For this NOPR, DOE analyzed the efficiency levels determined by the 
dataset, translation equations, and baseline definition approach 
previously presented in section IV.C.5.c. However, DOE is also 
considering alternate approaches for each of these components (i.e., 
the dataset to use, the method of defining translation equations, and 
the method for defining baseline) as well as any combination thereof, 
as described in the following sections.
i. Joint DOE-AHAM Dataset
    As discussed, AHAM has shared RCW test data with DOE, which DOE 
used to confirm the accuracy and appropriateness of the NOPR 
translation equations. As discussed in appendix 5A of the NOPR TSD, DOE 
considered developing alternate translation equations using the joint 
dataset containing both DOE and AHAM test data. However, neither the 
DOE dataset nor the AHAM dataset identifies the individual model 
numbers of each unit in the sample; therefore, DOE cannot ascertain 
whether the joint dataset double-counts any individual models. For this 
reason, DOE has tentatively determined to not use translation equations 
based on the joint dataset in this NOPR. Rather, DOE has overlayed the 
AHAM data onto the translation equations developed using DOE's dataset 
in order to confirm that the AHAM and DOE datasets exhibit consistent 
trends, as discussed further in appendix 5A of the NOPR TSD.
    DOE seeks comment on its tentative determination to use the DOE 
dataset as the basis for the translation equations rather than use the 
joint DOE-AHAM dataset.
ii. Merging Compact and Standard-Size Translation Equations
    The CA IOUs suggested that DOE eliminate the standard-size and 
compact product classes when developing both the ``best-fit line 
method'' and the ``average performance and market cluster method''. (CA 
IOUs, No. 43 at pp. 2-3) The CA IOUs stated that segmenting product 
classes into standard-size and compact arbitrarily separates products 
at a discrete product capacity and assumes that the relationship of 
IMEF to EER and IWF to WER is impacted by assignment to compact and 
standard-size categories. (Id.) The CA IOUs commented that while 
product classes can be useful for categorization, this categorization 
should not be confused for statistically justifiable clusters when 
conducting a translation analysis. (Id.) The CA IOUs commented that, 
although it may be appropriate to segment the data by product classes 
or a subset of unique performance attributes (such as top-loading 
versus front-loading), these performance attributes should be 
demonstrated with supporting analysis. (Id.) The CA IOUs suggested that 
a statistical clustering analysis such as k-means clustering could be 
used to show that the relationship between appendix J2 and appendix J 
metrics has fundamental differences that impact performance. (Id.) The 
CA IOUs commented that the separate categorization between compact and 
standard-size clothes washers assumes performance is impacted by 
product class alone, and that a k-means clustering would confirm if 
these four categories were statistically justified. (Id.) The CA IOUs 
stated that the relationship between appendix J2 and appendix J metrics 
could instead operate on a continuum based on capacity. (Id.) The CA 
IOUs commented that they believe that product performance is impacted 
by capacity, which exists along a continuum in alignment with the 
product performance relationship to capacity. (Id.) The CA IOUs also 
commented that they believe the relationship between the appendix J2 
and appendix J metrics should be controlled along that same continuum 
of capacity, and requested that DOE provide the measured EERs and WERs 
of products tested to appendix J so that this hypothesis can be tested. 
(Id.) The CA IOUs commented that combining data between compact and 
standard-size product classes will improve model fits to be better than 
the models presented in the September 2021 Preliminary TSD. (Id.) The 
CA IOUS also commented that combining data will address the lack of 
tested appendix J data in the top-loading compact product class. (Id.)
    DOE evaluated the CA IOUs' suggestion to develop only two sets of 
translation equations (i.e., one per axis of loading) rather than four 
(i.e., one per product class). Appendix 5A of the NOPR TSD presents the 
detailed results of this analysis.
    DOE notes that automatic top-loading ultra-compact and automatic 
top-loading standard-size clothes washers have significantly different 
operational characteristics (beyond just a difference in capacity), 
such that DOE does not expect that there should be a consistent 
correlation between appendix J2 and appendix J performance across the 
two product classes. For example, DOE has observed that the top-loading 
ultra-compact units on the market offer only two wash temperatures 
(warm and cold), and as such, hot water heating energy makes up a 
significantly lower fraction of total energy compared to top-loading 
standard-size units.\54\ Furthermore, although AHAM did not provide 
shipment data for the top-loading ultra-compact product class, DOE 
expects that because these represent niche products, this product class 
likely represents less than 1 percent of total sales. If DOE were to 
combine the 2 top-loading ultra-compact points with the 12 data points 
for top-loading standard-size units, the ultra-compact class would be 
significantly oversampled (e.g., 14 percent of the data versus less 
than 1 percent of sales). For these reasons, DOE is not proposing to 
use translation equations for top-loading product classes based on a 
single dataset that combines top-loading ultra-compact units with top-
loading standard-size units.
---------------------------------------------------------------------------

    \54\ As shown in the energy breakdown tables in chapter 7 of the 
NOPR TSD, hot water heating energy represents 5 percent of the total 
energy for the top-loading ultra-compact product class. Whereas, for 
the baseline efficiency level in the top-loading standard-size 
product class, hot water heating energy represents 16 percent of 
total energy use.
---------------------------------------------------------------------------

    Similarly, for the front-loading product classes, if DOE were to 
combine its 13 front-loading compact points with

[[Page 13561]]

its 12 front-loading standard-size points, the compact class would be 
significantly oversampled (e.g., 52 percent of the data versus 6 
percent of shipments, based on AHAM data). For this reason, DOE is not 
proposing to use translation equations for front-loading product 
classes based on a single dataset that combines front-loading compact-
size units with front-loading standard-size units.
    DOE seeks comment on its tentative determination not to merge the 
compact and standard-size translations, but to instead develop separate 
translations for each product class.
iii. ``Unadjusted'' Baseline Approach
    The CA IOUs commented that DOE should base its translation analysis 
on currently available cycle settings and performance and not employ 
the proposed 4-percentage-point adjustment. (CA IOUs, No. 52 at pp. 1-
2) The CA IOUs added that using the performance of currently available 
products more accurately reflects real-world energy and water 
efficiencies. (Id.) The CA IOUs commented that based on manufacturer 
input identified by DOE, the CA IOUs understand DOE's consideration 
that manufacturers may simply implement strategies similar to Cold/Cold 
optimized spin and non-default maximum spin to decrease RMC. (Id.) The 
CA IOUs stated that while some manufacturers may take this approach, 
this presumption should not be used as part of the baseline translation 
for all products. (Id.) The CA IOUs further commented that improving 
the RMC of different cycle settings (e.g., operating small loads at 
higher spin speeds or software adjustments to optimize RMC for 
different wash/rinse temperatures) should be treated as a low-cost 
technology option for efficiency level development, and that DOE's 
proposal of applying a 4-percentage point adjustment to the tested RMC 
of appendix J2 (the RMC of appendix J plus the difference in RMC for 
the smaller loads tested under appendix J2) only accounts for the 
natural difference in load size centrifugal force using the same spin 
speed and duration, effectively removes small load RMC improvements as 
a technology option. (Id.) The CA IOUs noted that this adjustment does 
improve the R-squared, the coefficient of determination for the 
translation correlation, but at the expense of accurately representing 
the differences between appendix J and appendix J2, which is what 
appendix J is partly designed to capture. (Id.) The CA IOUs added that 
while a higher R-squared translation correlation is preferable, the CA 
IOUs stated it should not be achieved at the expense of removing 
product-to-product variation that represents the real-world operation 
of available products. (Id.)
    ComEd and NEEA supported DOE's efforts to develop a more robust 
translation from appendix J2 to appendix J and DOE's general approach 
and methodology. (ComEd and NEEA, No. 50 at p. 2) However, ComEd and 
NEEA commented that NEEA estimates there will be 0.3 quads of newly 
realized real-world site energy savings achieved with this test 
procedure update that were counted earlier (by assuming a lower RMC 
across all cycles even though RMC was only tested on one cycle setting) 
but uncaptured in practice, and that this substantial energy savings is 
twice the site energy savings DOE calculated for EL 1 in the September 
2021 Preliminary TSD. (Id.) ComEd and NEEA stated that this discrepancy 
validates DOE's continued efforts to move forward with the translation 
analysis using appendix J. (Id.)
    ComEd and NEEA recommended that DOE not justify costs associated 
with the translation of spin implementations from appendix J2 to 
appendix J for three key reasons. (ComEd and NEEA, No. 50 at p. 4) 
First, for the most common RCW spin implementation (``consistent 
spin''), there is zero incremental cost to obtain the adjusted appendix 
J EER value because no design changes are needed to retain spin 
performance. (Id.) Second, for RCWs with ``cold-cold optimized'' spin 
and ``non-default maximum'' spin implementations, the incremental cost 
to achieve the adjusted appendix J EER value is nearly zero. (Id.) 
Third, these costs were already accounted for in the May 2012 Final 
Rule in the case of RCWs with increased spin time over the appliance 
lifetime whose manufacturers choose to upgrade to more durable 
components. (Id.)
    In response to the CA IOUs' comments, DOE is also considering an 
alternate approach to the translation of IMEF to EER in which DOE would 
define the baseline efficiency level based on a translation between 
appendix J2 and appendix J metrics without consideration of any changes 
to spin implementations as a result of adopting the appendix J test 
procedure. EL 1, in contrast, would be represented by the baseline 
level presented in this NOPR (i.e., reflecting the 4 percent ``adjusted 
RMC'' approach). As suggested by the CA IOUs, this approach would allow 
for a more explicit consideration of savings that are likely to occur 
solely as a result of the switching from appendix J2 to appendix J, as 
opposed to those savings already being reflected at baseline level. 
Appendix 5A of the NOPR TSD details the specific efficiency levels that 
could be defined for each front-loading product class using this 
approach.
    In response to ComEd and NEEA's comment that DOE should not include 
the costs associated with changes to spin implementation as a result of 
the change in test procedure, DOE notes that all costs incurred by 
manufacturers in response to this NOPR have been included in this NOPR 
analysis. While there may be zero incremental manufacturing cost to 
changing spin implementation, such changes would incur product 
conversion costs, as discussed further in section IV.J.2.c of this 
document. With regard to the assertion that these costs were already 
accounted for in the May 2012 Final Rule, the standards enacted by the 
May 2012 Final Rule were based on a different test procedure (i.e., 
appendix J2) than the test procedure proposed as a basis for the 
amended standards in this NOPR (i.e., appendix J). To the extent that 
appendix J requires manufacturers to change designs of products as they 
currently exist in the market, such changes are justifiable in 
considering in this analysis, irrespective of the costs that may have 
been incurred previously by manufacturers as a result of product 
investments required to comply with the standards enacted by the May 
2012 Final Rule.
    DOE seeks comment on whether it should consider defining an 
``unadjusted'' baseline efficiency level based on a translation between 
appendix J2 and appendix J metrics without consideration of any changes 
to spin implementations as a result of adopting the appendix J test 
procedure.

D. Markups Analysis

    The markups analysis develops appropriate markups (e.g., 
manufacturer markup, retailer markups, distributor markups, contractor 
markups) in the distribution chain and sales taxes to convert the MPC 
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 business costs and profit margin.
    To account for manufacturers' non-production costs and profit 
margin, DOE applies a multiplier (the manufacturer markup) to the MPC. 
The resulting manufacturer selling price (``MSP'') is the price at 
which the manufacturer distributes a unit into commerce. DOE developed 
an average manufacturer markup by examining the annual

[[Page 13562]]

Securities and Exchange Commission (``SEC'') 10-K reports filed by 
publicly traded manufacturers primarily engaged in appliance 
manufacturing and whose combined product range includes RCWs.\55\ See 
chapter 12 of the NOPR TSD for additional detail on the manufacturer 
markup.
---------------------------------------------------------------------------

    \55\ U.S. Securities and Exchange Commission, Electronic Data 
Gathering, Analysis, and Retrieval (EDGAR) system. Available at 
www.sec.gov/edgar/search/ (last accessed July 1, 2022).
---------------------------------------------------------------------------

    For RCWs, the main parties in the post-manufacturer distribution 
chain are retailers/distributors and consumers. DOE developed baseline 
and incremental markups for each of these. Baseline markups are applied 
to the price of products with baseline efficiency, while incremental 
markups are applied to the 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 
amended standards.\56\ DOE relied on economic data from the U.S. Census 
Bureau to estimate average baseline and incremental markups.\57\
---------------------------------------------------------------------------

    \56\ 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.
    \57\ US Census Bureau, Annual Wholesale Trade Survey. 2017. 
Available at www.census.gov/awts (last accessed May 2, 2022).
---------------------------------------------------------------------------

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

E. Energy and Water Use Analysis

    The purpose of the energy and water use analysis is to determine 
the annual energy and water consumption of RCWs 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 RCW efficiency. The energy and water use 
analysis estimates the range of energy and water use of RCWs in the 
field (i.e., as they are actually used by consumers). The energy and 
water use analysis provides the basis for other analyses DOE performed, 
particularly assessments of the energy and water 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 and water consumption in 
the field for RCWs, DOE primarily used data from 2015 RECS.\58\ RECS is 
a national sample survey of housing units that collects statistical 
information on the consumption of and expenditures for energy in 
housing units along with data on energy-related characteristics of the 
housing units and occupants. The 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.\59\ 
DOE's assumptions for establishing an RCW sample included the following 
considerations:
---------------------------------------------------------------------------

    \58\ U.S. Department of Energy--Energy Information 
Administration, Residential Energy Consumption Survey: 2015 Public 
Use Data Files, 2015. Available at www.eia.doe.gov/emeu/recs/recspubuse15/pubuse15.html (last accessed May 12, 2022).
    \59\ RECS 2015 is the most recent edition of RECS available at 
the time of this NOPR analysis. For the final rule analysis, DOE 
plans to use the microdata of the 2020 RECS.
---------------------------------------------------------------------------

     The household had a clothes washer.
     Clothes washer use was greater than zero.
    DOE divided the sample of households into five sub-samples to 
characterize the product category being analyzed: standard-size or 
compact or semi-automatic, top-loading or front-loading RCWs. For 
compact and semi-automatic clothes washers, DOE developed a sub-sample 
consisting of households from multifamily buildings, manufactured 
homes, and single-family homes with less than 1,000 square feet and no 
garage or basement, since DOE reasoned that such products are most 
likely to be found in these housing types.
    The energy and water use analysis requires DOE to establish a range 
of total annual usage or annual number of cycles in order to estimate 
annual energy and water consumption by a clothes washer unit. DOE 
estimated the number of clothes washer cycles per year for each sample 
household using data given by RECS 2015 on the number of laundry loads 
washed (clothes washer cycles) per week.
    For each sample household, DOE estimated the field-based annual 
energy and water use of the clothes washer by multiplying the annual 
number of clothes washer cycles for each household by the per-cycle 
energy and water use values established by the engineering analysis 
(using the DOE test procedure) for each considered efficiency level. 
Per-cycle clothes washer energy use is calculated in the test procedure 
as the sum of per-cycle machine energy use associated with the clothes 
washer (including the energy used to heat water and remove moisture 
from clothing),\60\ and combined low-power mode energy use.
---------------------------------------------------------------------------

    \60\ The per-cycle energy consumption associated with a given 
clothes washer has three components: energy used for heating water, 
operating the machine, and drying the clothes.
---------------------------------------------------------------------------

1. Number of Annual Cycles
    The average annual energy and water consumption reflects an average 
annual weighted usage of 238 cycles per year (233 for top-loading 
clothes washers and 254 for front-loading clothes washers). This 
average usage is obtained from 2015 RECS.\61\
---------------------------------------------------------------------------

    \61\ DOE acknowledges that the value of 238 average annual 
cycles used in the Energy and Water Use Analysis differs from the 
value of 234 annual cycles used in appendix J. As discussed above, 
the value of 238 was determined while excluding RECS households that 
do not use their clothes washer (i.e., households with clothes 
washer use equal to 0 cycles per week) because these households' 
clothes washers would not contribute to the nation's total energy 
and water use. By comparison, the value of 234 used in appendix J 
did not exclude such households, because the test procedure is 
designed to represent the average household energy and water usage.
---------------------------------------------------------------------------

    Ameren et al. recommended that DOE not use the number of annual 
clothes washer cycles predicted by the RECS methodology because it 
relies on participant recollection and is therefore subject to recall 
bias. They stated that a single RECS respondent may not accurately 
count cycles of other household members, leading to underestimates. 
(Ameren et al., No. 42 at pp. 16-17)
    RECS asks ``In a typical week, about how many times is your clothes 
washer used?'' A response does not require recollection of behavior in 
the distant past. DOE acknowledges that recall bias is in general an 
issue in surveys where consumers are asked about their past behavior, 
but DOE does not believe that RECS households would significantly 
underestimate the number of washer cycles.
    Ameren et al. encouraged DOE to increase the annual number of 
clothes washer cycles in its analysis and/or conduct its own field 
study to determine more accurately the average annual number of clothes 
washer cycles given that the RECS estimate is significantly lower than 
the annual number of cycles calculated in NEEA's RBSA Laundry study 
published in 2014 (``2014 Laundry Study'').\62\ (Ameren et al., No. 42 
at pp. 17-18)
---------------------------------------------------------------------------

    \62\ Hannas, B. and Gilman, L. 2014. RBSA Laundry Study (Report 
# E14-287). Portland, OR: Northwest Energy Efficiency Alliance. p. 
38. 20 November. Retrieved from neea.org/resources/rbsa-laundry-study.
---------------------------------------------------------------------------

    DOE reviewed the 2014 Laundry Study. Because the Study collected 
field metering data from 45 homes across three States, with more than 
70 percent

[[Page 13563]]

of selected homes located in Washington State, it is not a 
representative sample of all U.S. households that use a clothes washer. 
The 2015 RECS is a nationally representative sample of U.S. households 
with more than 5,600 households with a clothes washer. For the final 
rule analysis, DOE plans to use the microdata of the 2020 RECS, which 
was released in July 2022 and contains a nationally representative 
sample of 18,500 occupied U.S. households.
2. Rebound Effect
    In calculating energy consumption of RCWs, DOE considered whether 
it would be appropriate to include a rebound effect (also called a 
take-back effect), which represents the increased energy consumption 
that can result from increases in energy efficiency and the associated 
reduction in operating costs. The rebound effect assumes that consumers 
will increase their overall annual usage of a more efficient product, 
thereby decreasing their overall annual savings.
    Ameren et al. commented in support of DOE's determination that 
there is no rebound effect associated with more efficient clothes 
washers and agreed with DOE that consumers will not use their clothes 
washers more if the efficiency increases. (Ameren et al., No. 42 at p. 
20)
    DOE requests comment and information on the specific efficiency 
levels at which any potential rebound effects may happen, as well as 
the magnitude of the effect.
    Chapter 7 of the NOPR TSD provides details on DOE's energy and 
water use analysis for RCWs.
3. Water Heating Energy Use
    Per-cycle water heating energy consumption is one of the four 
energy components in the EER metric. Appendix J includes water-heating 
energy equations that estimate the energy required by the household 
water heater to heat the hot water used by the clothes washer. In 
section 4.1.2 of appendix J, the water heating energy consumption is 
calculated by multiplying the measured volume of hot water by a 
constant fixed temperature rise of 65 [deg]F and by the specific heat 
of water. No efficiency or loss factor is included in this calculation, 
which implies an electric water heater efficiency of 100 percent.
    Ameren et al. presented data from 3 studies that contradict DOE's 
assertion that 78 percent efficiency is typical for gas water heaters. 
Based on these 3 studies, Ameren et al. concluded that both market and 
field data analysis reveal that typical gas water heater efficiency 
ranges from 62 to 70 percent. (Ameren et al., No. 42 at pp. 14-16) ASAP 
et al. commented that they believe DOE's assumption of 100 percent 
efficiency for electric water heaters and 78 percent efficiency for gas 
water heaters is likely significantly overstating the efficiencies of 
water heaters in the field. ASAP et al. commented that based on 
shipment data from the last water heater rulemaking and current models 
in DOE's CCD, the shipment-weighted efficiencies for new water heaters 
are about 92 percent for electric water heaters and 64 percent for gas 
water heaters. (ASAP et al., No. 37 at pp. 2-3)
    In the 2019 preliminary analysis for consumer water heaters, DOE 
calculated the energy use of water heaters using a simplified energy 
equation, the water heater analysis model (WHAM). WHAM accounts for a 
range of operating conditions and energy efficiency characteristics of 
water heaters. To describe energy efficiency characteristics of water 
heaters, WHAM uses three parameters that also are used in the DOE test 
procedure: recovery efficiency, standby heat-loss coefficient, and 
rated input power. The September 2021 Preliminary TSD states that DOE 
used a recovery efficiency of 78 percent for gas water heaters, not 
0.78 Energy Factor for the calculation of hot water energy savings. The 
hot water energy savings are almost directly proportional to the 
recovery efficiency, and the NOPR analysis uses the most recent data 
reported for the 2022 consumer water heater rulemaking.\63\
---------------------------------------------------------------------------

    \63\ DOE, 2022-03 Preliminary Analysis Technical Support 
Document: Energy Efficiency Program for Consumer Products and 
Commercial and Industrial Equipment: Consumer Water Heaters, March 
2022. EERE-2017-BT-STD-0019-0018. Available at: www.regulations.gov/document/EERE-2017-BT-STD-0019-0018 (last accessed June 21, 2022).
---------------------------------------------------------------------------

    ASAP et al. recommended that DOE clarify the hot water temperature 
rise estimate used in the hot water energy usage calculations and 
suggested that believe a value lower than 75 [deg]F (e.g., 67.5 [deg]F) 
would more accurately reflect hot water energy usage. (ASAP et al., No. 
37 at p. 5)
    For this NOPR analysis, DOE revised hot water temperature rise from 
75 [deg]F to 65 [deg]F based on the updates in the RCW test procedure. 
87 FR 33316, 33326-33327.

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 
RCWs. 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:
     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 
and water 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.
     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 RCWs in the absence of 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 
residential housing units. As stated previously, DOE developed 
household samples from the 2015 RECS. For each sample household, DOE 
determined the energy and water consumption for the RCWs and the 
appropriate energy and water prices. By developing a representative 
sample of households, the analysis captured the variability in energy 
and water consumption and energy and water prices associated with the 
use of RCWs.
    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 and water 
consumption, energy and water 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

[[Page 13564]]

value, to account for their uncertainty and variability.
    The computer model DOE uses to calculate the LCC 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 RCW user samples. For this 
rulemaking, the Monte Carlo approach is implemented in MS Excel 
together with the Crystal Ball\TM\ add-on.\64\ The model calculated the 
LCC 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 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.
---------------------------------------------------------------------------

    \64\ 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 July 6, 2022).
---------------------------------------------------------------------------

    DOE calculated the LCC and PBP for consumers of RCWs as if each 
were to purchase a new product in the expected year of required 
compliance with amended standards. Amended standards would apply to 
RCWs 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 RCWs.
    Table IV.31 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.31--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 RS Means
                                     Residential Cost Data 2021. Assumed
                                     no change with efficiency level.
Annual Energy and Water Use.......  Per cycle energy and water use
                                     multiplied by the cycles per year.
                                     Average number of cycles based on
                                     field data.
                                    Variability: Based on the 2015 RECS.
Energy and Water Prices...........  Electricity: Based on EIA's Form 861
                                     data for 2021.
                                    Variability: Regional energy prices
                                     determined for 9 Census Divisions.
                                    Water: Based on 2020 AWWA/Raftelis
                                     Survey.
                                    Variability: Regional water prices
                                     determined for 4 Census Regions.
Energy and water Price Trends.....  Energy: Forecasted using AEO 2022
                                     price forecasts.
                                    Water: Forecasted using BLS historic
                                     water price index information.
Repair and Maintenance Costs......  Repair costs vary by product class
                                     and vary between ENERGY STAR and
                                     non-ENERGY START washers.
Product Lifetime..................  Average: 13.7 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.
------------------------------------------------------------------------
* Not used for PBP calculation. 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.

    Ameren et al. encouraged DOE to calculate and consider the return 
on investment for each efficiency level in its analysis to add 
additional insight for stakeholders and decision-makers. Ameren et al. 
commented that efficiency improvements to an appliance can be 
considered capital investments, with ``returns'' being the money saved 
from utility bill reductions. (Ameren et al., No. 42 at pp. 18-19)
    DOE acknowledges that return on investment is a metric that can be 
useful in evaluating investments in energy efficiency. However, the 
measures that DOE has historically used to evaluate the economic 
impacts of standards on consumers--LCC savings and PBP--are more 
closely related to the language in EPCA that 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)) Therefore, DOE finds it reasonable to 
continue to use those measures.
    AHAM commented that DOE's use of ``Net Cost'' for impacted 
households is incomplete and misleading. AHAM suggested that the ``Net 
Cost'' should be calculated only among the affected households. (AHAM, 
No. 40 at p. 21)
    DOE maintains that showing the share of all consumers who would 
experience a net LCC cost is useful information, as EPCA requires DOE 
to consider the impact of standards on ``consumers,'' not only those 
who would be affected by a standard.
1. Consumer Product Cost
    To calculate consumer product costs, DOE multiplied the MPCs 
developed in the engineering analysis by the markups described in 
section IV.C.6 of this document (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

[[Page 13565]]

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.\65\ To derive the 
learning rate parameter for RCWs, 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 2019 from the Bureau of Labor Statistics' (``BLS'') to 
form a time series price index representing household laundry equipment 
from 1948 to 2021.\66\ These two PPI series are the most current and 
disaggregated price index that includes RCWs, and DOE assumes that the 
price trend estimated from the household laundry equipment PPI is 
representative of that for RCWs. Inflation-adjusted price indices were 
calculated by dividing the PPI series by the gross domestic product 
index from Bureau of Economic Analysis for the same years. The 
estimated learning rate (defined as the fractional reduction in price 
expected from each doubling of cumulative production) is 14.4  1.7 percent. See chapter 8 of the NOPR TSD for further details 
on this topic.
---------------------------------------------------------------------------

    \65\ Taylor, M. and Fujita, K.S. Accounting for Technological 
Change in Regulatory Impact Analyses: The Learning Curve Technique. 
LBNL-6195E. Lawrence Berkeley National Laboratory, Berkeley, CA. 
April 2013. Available at escholarship.org/uc/item/3c8709p4#page-1.
    \66\ 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/.
---------------------------------------------------------------------------

    Ameren et al. encouraged DOE to continue to apply a learning rate 
for product prices in its lifecycle cost and payback period analyses 
and encourages DOE to model as if RCW sales occurred before 1947, as 
this could produce a better fit to the model used and be more 
representative of the learning rate for the RCW industry. (Ameren et 
al., No. 42 at p. 19)
    The fit started in 1948 because that is the start year of the 
household laundry product PPI. In order to derive the corresponding 
cumulative productions, DOE performed a trend analysis to extrapolate 
shipments prior to AHAM historical data and determined the shipments 
were at a very low level and thus started the cumulative production 
accounting in 1948. DOE will explore alternative approaches for 
shipment extrapolation in the final rule analysis to better account for 
shipments prior to 1948 and improve the model fit.
    AHAM commented that equipment prices at EL 1 and EL 2 in the 
September 2021 Preliminary Analysis were underestimated and suggested 
that DOE use actual retail price differences between a baseline and 
higher efficiency level instead of taking the traditional approach of 
converting manufacturer production costs to consumer retail prices. 
(AHAM, No. 40 at p. 21)
    The actual retail price differences between a baseline and higher 
efficiency level may include the price for other features in addition 
to engineering designs relating to efficiency, and also reflects 
economies of scale in production, as well as marketing strategies and 
profit margins of manufacturers and retailers. DOE maintains that its 
traditional approach, which has been subject to peer review, is better 
able to identify the incremental costs that are only connected to 
higher efficiency. Furthermore, for this NOPR analysis, DOE revised the 
engineering costs of top-loading standard-size clothes washers, and the 
estimated equipment price difference between the baseline level and the 
ENERGY STAR level is now $163.50, before sales tax, which closely 
aligns with the retail price difference (i.e., $160 before sales tax) 
presented by AHAM.
2. Installation Cost
    Installation cost includes labor, overhead, and any miscellaneous 
materials and parts needed to install the product. DOE used data from 
2021 RSMeans Residential Cost Data to estimate the baseline 
installation cost for RCWs.\67\ DOE found no evidence that installation 
costs would be impacted with increased efficiency levels.
---------------------------------------------------------------------------

    \67\ RS Means Company Inc., RS Means Residential Cost Data 
(2021). Available at https://rsmeans.com/.
---------------------------------------------------------------------------

3. Annual Energy and Water Consumption
    For each sampled household, DOE determined the energy and water 
consumption for an RCW at different efficiency levels using the 
approach described previously in section IV.E of this document.
4. Energy and Water Prices
a. Energy Prices
    Because marginal electricity and gas prices more accurately 
captures the incremental savings associated with a change in energy use 
from higher efficiency, it provides 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 2021 using data from EEI Typical 
Bills and Average Rates reports for summer and winter 2021.\68\ 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. For the 
residential sector, DOE calculated electricity prices using the 
methodology described in Coughlin and Beraki (2018).\69\
---------------------------------------------------------------------------

    \68\ Edison Electric Institute. Typical Bills and Average Rates 
Report. Winter 2021, Summer 2021. Available at: www.eei.org/resourcesandmedia/products/Pages/Products.aspx.
    \69\ 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.\70\ This publication 
presents monthly volumes of natural gas deliveries and average prices 
by state for residential, commercial, and industrial customers. DOE 
used the complete annual data for 2020 to calculate an average annual 
price for each census division. Residential natural gas prices were 
adjusted by applying seasonal marginal price factors to reflect a 
change in a consumer's bill associated with a change in energy 
consumed.
---------------------------------------------------------------------------

    \70\ U.S. Department of Energy--Energy Information 
Administration. Natural Gas Navigator 2020. Available at 
www.eia.gov/naturalgas/data.php.
---------------------------------------------------------------------------

    EIA provides historical monthly natural gas consumption and 
expenditures by state. This data was used to determine 10-year average 
marginal price factors for the RECS 2015 census divisions, which are 
then used to convert average monthly natural gas prices into marginal 
monthly natural gas prices. DOE interpreted the slope of the regression 
line (consumption vs. expenditures) for each State as the marginal 
natural gas price factor for that State.
    DOE assigned average prices to each household in the LCC sample 
based on its location and its baseline electricity and gas consumption. 
For sampled households who were assigned a product efficiency greater 
than or equal to the considered level for a standard in the no-new-
standards case, DOE

[[Page 13566]]

assigned marginal prices to each household based on its location and 
the decremented electricity and gas consumption. In the LCC sample, 
households could be assigned to one of nine census divisions. See 
chapter 8 of the NOPR TSD for details.
    To estimate energy prices in future years, DOE multiplied the 
average and marginal regional energy prices by the projection of annual 
average price changes for each of the nine census divisions from the 
Reference case in AEO2022, which has an end year of 2050.\71\ To 
estimate price trends after 2050, the 2046-2050 average was used for 
all years.
---------------------------------------------------------------------------

    \71\ EIA. Annual Energy Outlook 2022 with Projections to 2050. 
Washington, DC. Available at www.eia.gov/forecasts/aeo/ (last 
accessed June 14, 2022).
---------------------------------------------------------------------------

b. Water and Wastewater Prices
    DOE obtained residential water and wastewater price data from the 
Water and Wastewater Rate Survey conducted by Raftelis Financial 
Consultants and the American Water Works Association.\72\ The survey 
covers approximately 194 water utilities and 140 wastewater utilities 
analyzing each industry (water and wastewater) separately. For each 
water or wastewater utility, DOE calculated the average price per unit 
volume by dividing the total volumetric cost by the volume delivered. 
DOE also calculated the marginal price by dividing the incremental cost 
by the increased volume charged at each consumption level.
---------------------------------------------------------------------------

    \72\ Raftelis Financial Consultants, Inc. 2020 RFC/AWWA Water 
and Wastewater Rate Survey. 2021. Charlotte, NC, Kansas City, MO, 
and Pasadena, CA.
---------------------------------------------------------------------------

    The samples that DOE obtained of the water and wastewater utilities 
is too small to calculate regional prices for all U.S. Census 
divisions. Therefore, DOE calculated regional costs for water and 
wastewater service at the Census region level (Northeast, South, 
Midwest, and West) by weighting each State in a region by its 
population.
    For this NOPR analysis, DOE also developed water prices for 
consumers who rely on private well water systems for their water needs 
rather than relying on the public supply system. DOE considered several 
factors when developing consumer prices for water supplied by private 
wells. Initial costs to install a well include well siting; well 
drilling; pump purchase and installation; water testing; and sometimes 
a water treatment system. Ongoing costs include pump maintenance; pump 
fuel to lift water to the surface and to the point of use or storage; 
plus, any required maintenance of the treatment system (water-softening 
chemicals, filters, etc.). To determine the current percentage of the 
U.S. population served by private wells, DOE used historical American 
Housing Survey (``AHS'') data from 1970 to 2019 to develop a projection 
for 2027, the effective year of potential new standards for RCWs.\73\ 
DOE then weighted public utility water and wastewater prices and 
private well prices for each census region and derived weighted-average 
regional and national water price for residential consumers.
---------------------------------------------------------------------------

    \73\ The U.S. Census Bureau. The American Housing Survey. Years 
1970-2019. Available at www.census.gov/programs-surveys/ahs.html 
(last accessed May 12, 2022).
---------------------------------------------------------------------------

    To estimate the future trend for water and wastewater prices, DOE 
used data on the historic trend in the national water price index (U.S. 
city average) from 1988 through 2021 provided by the Labor Department's 
BLS.\74\ DOE extrapolated the future trend based on the linear growth 
from 1988 to 2021. DOE used the extrapolated trend to forecast prices 
through 2050. To estimate price trend after 2050, DOE used a constant 
value derived from the average values from 2046 through 2050.
---------------------------------------------------------------------------

    \74\ U.S. Department of Labor-Bureau of Labor Statistics, 
Consumer Price Indexes, Item: Water and sewerage maintenance, Series 
Id: CUSR0000SEHG01, U.S. city average, 2021. Washington, DC. 
Available at www.bls.gov/cpi/home.htm#data.
---------------------------------------------------------------------------

    AHAM commented that DOE's water prices should include rural well 
and septic tank users. (AHAM, No. 40 at pp. 29-31)
    As described above, for this NOPR analysis, DOE developed water 
prices for rural well and septic tank users. DOE then weighted public 
utility water and wastewater prices and private well prices for each 
census region and derived weighted-average regional and national water 
price for residential consumers.
    Chapter 8 and Appendix 8E of the NOPR TSD provides further details 
on the methodology and sources DOE used to develop consumer water 
prices.
5. Repair and Maintenance 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.
    For RCWs, DOE determined repair cost associated with loading type 
and clothes washer capacity commonly found on an appliance repair 
website.\75\ DOE estimated the average repair cost for an RCW is about 
$225, ranging from $115 to $275. For maintenance cost, DOE conducted 
literature review of maintenance cost available from a variety of 
sources, including online resources. DOE estimated the annual 
maintenance cost for an RCW is approximately $25, including costs of 
clothes washer cleaners and of running clothes washer cleaning cycles.
---------------------------------------------------------------------------

    \75\ Fixr, How Much Does It Cost to Repair a Washing Machine? 
Available at www.fixr.com/costs/washing-machine-repair#washing-machine-repair-cost-by-type-of-repair.
---------------------------------------------------------------------------

    Typically, small incremental increases in product efficiency 
produce no, or only minor, changes in repair and maintenance costs 
compared to baseline efficiency products. For this NOPR analysis, DOE 
estimated that for repair costs, there is a cost difference between an 
ENERGY STAR and non-ENERGY STAR clothes washer of approximately $44 for 
a front-loading and $32 for a top-loading clothes washer, based on 
information aggregated from confidential manufacturer interviews. For 
maintenance costs, DOE assumed that there is no change with efficiency 
level for RCWs.
    DOE requests comment and information on frequency of cleaning 
cycles run per number of cycles used to clean clothes and associated 
data as compared to the recommendations in the manufacturer's use and 
care manuals.
6. Product Lifetime
    Product lifetime is the age at which an appliance is retired from 
service. Appliance magazine, a trade publication, provides estimates of 
the low, high, and average years of an appliance's lifetime.\76\ The 
estimates, which are based on first-owner use of the product, represent 
the judgment of Appliance staff based on input obtained from various 
sources. The average lifetime estimate from Appliance magazine is 11 
years.
---------------------------------------------------------------------------

    \76\ Appliance Magazine. A Portrait of the U.S. Appliance 
Industry: Market Share, Life Expectancy & Replacement Market, and 
Saturation Levels. 2014.
---------------------------------------------------------------------------

    To determine estimates for RCW lifetime, DOE conducted an analysis 
of standard-capacity RCW lifetime in the field based on a combination 
of shipments data and data on the ages of the clothes washer products 
reported in the household stock from RECS conducted in 2001, 2005, 
2009, and 2015 data.\77\ DOE also used the U.S. Census's biennial AHS 
from 1974-2019, which surveys all housing, noting the

[[Page 13567]]

presence of a range of appliances.\78\ As described in chapter 8 of the 
NOPR TSD, the analysis yielded an estimate of mean age for standard-
capacity RCWs of approximately 13.7 years. It also yielded a survival 
function that DOE incorporated as a probability distribution in its LCC 
analysis. Because the RECS data does not indicate whether the clothes 
washer has a top-loading or front-loading configuration, DOE was not 
able to derive separate lifetime estimates for these two loading types. 
DOE did not receive any data or analysis to support separate lifetime 
for the different product classes.
---------------------------------------------------------------------------

    \77\ U.S. Department of Energy--Energy Information 
Administration, Residential Energy Consumption Survey (``RECS''), 
Multiple Years (1990, 1993, 1997, 2001, 2005, 2009, and 2015). 
Available at www.eia.gov/consumption/residential/.
    \78\ U.S. Census Bureau: Housing and Household Economic 
Statistics Division, American Housing Survey, Multiple Years (1974, 
1975, 1976, 1977, 1978, 1979, 1980, 1981, 1983, 1985, 1987, 1989, 
1991, 1993, 1995, 1997, 1999, 2001, 2003, 2005, 2007, 2009, 2011, 
2013, 2015, 2017, and 2019). Available at www.census.gov/programs-surveys/ahs/.
---------------------------------------------------------------------------

    DOE requests comment and information on RCW lifetime.
    See chapter 8 of the NOPR TSD for further details on the method and 
sources DOE used to develop product lifetime.
7. Discount Rates
    In the calculation of LCC, DOE applies discount rates appropriate 
to RCWs to estimate the present value of future operating cost savings. 
DOE estimated a distribution of discount rates for RCWs 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.\79\ 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.
---------------------------------------------------------------------------

    \79\ 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. The implicit discount rate is 
not appropriate for the LCC analysis because it reflects a range of 
factors that influence consumer purchase decisions, rather than the 
opportunity cost of the funds that are used in purchases.
---------------------------------------------------------------------------

    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 triennial Survey of Consumer Finances 
(``SCF'') starting in 1995 and ending in 2019.\80\ 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.
---------------------------------------------------------------------------

    \80\ The Federal Reserve Board, Survey of Consumer Finances 
(1995, 1998, 2001, 2004, 2007, 2010, 2013, 2016, and 2019). 
Available at: www.federalreserve.gov/econres/scfindex.htm.
---------------------------------------------------------------------------

    AHAM and GEA suggested that DOE develop a more reasonable interest 
rate distribution for the low-income group that is closer to a credit 
card rate for this group. (AHAM, No. 40 at p. 27; GEA, No. 38 at p. 2)
    DOE maintains that the interest rate associated with the specific 
source of funds (e.g., credit card) used to purchase a clothes washer 
(i.e., the marginal rate) is not the appropriate metric to measure the 
discount rate as defined for the LCC analysis. The marginal interest 
rate alone would only be the relevant discount rate if the consumer 
were restricted from re-balancing their debt and asset holdings (by 
redistributing debts and assets based on the relative interest rates 
available) over the entire time period modeled in the LCC analysis. The 
LCC is not analyzing a marginal decision; rather, it estimates net 
present value over the lifetime of the product, therefore the discount 
rate needs to reflect the opportunity cost of both the money flowing in 
(through operating cost savings) and out (through upfront cost 
expenditures) of the net present value calculation. In the context of 
the LCC analysis, the consumer is not only discounting based on their 
opportunity cost of money spent today, they are also discounting the 
stream of future benefits. A consumer might pay for an appliance with 
cash, thereby forgoing investment of those funds into one of the 
interest earning assets to which they might have access. Alternatively, 
a consumer might pay for the initial purchase by going into debt, 
subject to the cost of capital at the interest rate relevant for that 
purchase. However, a consumer will also receive a stream of future 
benefits in terms of annual operating cost savings that they could 
either put towards paying off that or other debts, or towards assets, 
depending on the restrictions they face in their debt payment 
requirements and the relative size of the interest rates on their debts 
and assets. All of these interest rates are relevant in the context of 
the LCC analysis, as they all reflect direct costs of borrowing, or 
opportunity costs of money either now or in the future. Additionally, 
while a clothes washer itself is not a readily tradable commodity, the 
money used to purchase it and the annual operating cost savings 
accruing to it over time flow from and to a household's pool of debt 
and assets, including mortgages, mutual funds, money market accounts, 
etc. Therefore, the weighted-average interest rate on debts and assets 
provides a reasonable estimate for a household's opportunity cost (and 
discount rate) relevant to future costs and savings. DOE maintains that 
the best proxy for this re-optimization of debt and asset holdings over 
the lifetime of the LCC analysis is to assume that the distribution of 
debts and assets in the future will be proportional to the distribution 
of debts and assets historically. Given the long time horizon modeled 
in the LCC, the application of a marginal rate alone would be 
inaccurate. DOE's methodology for deriving residential discount rates 
is in line with the weighted-average cost of capital used to estimate 
commercial discount rates. For these reasons, DOE is maintaining its 
existing approach to 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 top-loading 
standard-size, front-loading compact and

[[Page 13568]]

standard-size RCWs for 2027, DOE used shipments-weighted energy 
efficiency ratio (``SWEER'') for 2020 as a starting point, based on the 
information provided by AHAM. (AHAM, No. 54 at pp. 2-3) To project the 
trend in efficiency, DOE considered recent trends in DOE's RCW CCD and 
the potential effect of labeling programs such as ENERGY STAR on RCWs. 
DOE estimated an annual efficiency improvement of 0.4 and 0.1 percent 
for top-loading standard-size and front-loading (compact and standard-
size) clothes washers, respectively. For semi-automatic clothes 
washers, DOE used the CCD database to develop a product efficiency 
distribution under the no-new-standards case.
    The estimated market shares for the no-new-standards case for RCWs 
are shown in Table IV.32 and Table IV.33. See chapter 8 of the NOPR TSD 
for further information on the derivation of the efficiency 
distributions.

   Table IV.32--No-New-Standards Case Market Share in 2027: Semi-Automatic and Top-Loading Residential Clothes
                                                     Washers
----------------------------------------------------------------------------------------------------------------
                               Semi-automatic          Top-loading, ultra-compact    Top-loading, standard-size
                       -----------------------------------------------------------------------------------------
   Efficiency level     EER (lb/  WER (lb/            EER (lb/  WER (lb/            EER (lb/  WER (lb/
                          kWh/      gal/      Share     kWh/      gal/      Share     kWh/      gal/      Share
                         cycle)    cycle)      (%)     cycle)    cycle)      (%)     cycle)    cycle)      (%)
----------------------------------------------------------------------------------------------------------------
Baseline..............      1.60      0.17      21.0      3.79      0.29       100      3.50      0.38      61.0
1.....................      2.12      0.27      71.0  ........  ........  ........      3.89      0.47       5.9
2.....................      2.51      0.36       8.0  ........  ........  ........      4.27      0.57      27.4
3.....................  ........  ........  ........  ........  ........  ........      4.78      0.63       4.7
4.....................  ........  ........  ........  ........  ........  ........      5.37      0.67       1.0
----------------------------------------------------------------------------------------------------------------


                           Table IV.33--No-New-Standards Case Market Share in 2027: Front-Loading Residential Clothes Washers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Front-loading, compact                             Front-loading, standard-size
                                             -----------------------------------------------------------------------------------------------------------
              Efficiency level                  EER (lb/kWh/      WER (lb/gal/                        EER (lb/kWh/      WER (lb/gal/
                                                   cycle)            cycle)           Share (%)          cycle)            cycle)           Share (%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Baseline....................................              4.41              0.53               0.0              5.02              0.64               2.0
1...........................................              4.80              0.62              38.7              5.31              0.69               5.6
2...........................................              5.02              0.71              45.8              5.52              0.77              44.1
3...........................................              5.53              0.75              14.5              5.73              0.77              40.1
4...........................................              5.97              0.80               1.0              5.97              0.85               8.2
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The LCC Monte Carlo simulations draw from the efficiency 
distributions and randomly assign an efficiency to the RCW purchased by 
each sample household in the no-new-standards case. The resulting 
percent shares within the sample match the market shares in the 
efficiency distributions.
    AHAM objected to DOE's use of random assignment of RECS households 
to baseline and higher efficiency levels, which assumes that consumers 
are agnostic to energy costs. AHAM stated that it is very unlikely that 
consumers with very high potential LCC savings would not have already 
decided to purchase a more efficient washer (i.e., in the no-new-
standards case), and DOE's assumption that these consumers are 
indifferent to operating costs appears contrary to common sense and 
experience in the retail field. AHAM stated that the most appropriate 
solution is to have a much more robust consumer choice theory. (AHAM, 
No. 40 at pp. 18-20)
    While DOE acknowledges that economic factors may play a role when 
consumers decide on what type of clothes washer to install, assignment 
of clothes washer efficiency for a given installation based solely on 
economic measures such as life-cycle cost or simple payback period most 
likely would not fully and accurately reflect actual real-world 
installations. There are a number of market failures discussed in the 
economics literature that illustrate how purchasing decisions with 
respect to energy efficiency are unlikely to be perfectly correlated 
with energy use, as described further down. DOE maintains that the 
method of assignment is a reasonable approach and one that simulates 
behavior in the clothes washer market, where market failures result in 
purchasing decisions not being perfectly aligned with economic 
interests, more realistically than relying only on apparent cost-
effectiveness criteria derived from the information in RECS. DOE 
further emphasizes that its approach does not assume that all 
purchasers of clothes washers make economically irrational decisions 
(i.e., the lack of a correlation is not the same as a negative 
correlation). By using this approach, DOE acknowledges the uncertainty 
inherent in the data and minimizes any bias in the analysis by using 
random assignment, as opposed to assuming certain market conditions 
that are unsupported given the available evidence.
    First, consumers are motivated by more than simple financial trade-
offs. There are consumers who are willing to pay a premium for more 
energy-efficient products because they are environmentally 
conscious.\81\ There are also several behavioral factors that can 
influence the purchasing decisions of complicated multi-attribute 
products, such as clothes washers. For example, consumers (or decision 
makers in an organization) are highly influenced by choice 
architecture, defined as the framing of the decision, the surrounding 
circumstances of the purchase, the alternatives available, and how they 
are presented for any given choice scenario.\82\ The same consumer or 
decision maker may make different choices depending on the 
characteristics of the decision context (e.g., the timing of the 
purchase, competing demands for funds), which have nothing to do with 
the characteristics of the alternatives themselves or their prices. 
Consumers or decision makers also face a variety of other behavioral 
phenomena including

[[Page 13569]]

loss aversion, sensitivity to information salience, and other forms of 
bounded rationality. Richard Thaler, who won the Nobel Prize in 
Economics in 2017 for his contributions to behavioral economics, and 
Cass Sunstein point out that these behavioral factors are strongest 
when the decisions are complex and infrequent, when feedback on the 
decision is muted and slow, and when there is a high degree of 
information asymmetry.\83\ These characteristics describe almost all 
purchasing situations of appliances and equipment, including RCWs. The 
installation of a new or replacement clothes washer is done very 
infrequently, as evidenced by the mean lifetime of 13.7 years. 
Additionally, it would take at least a few months for any impacts on 
operating costs to be fully apparent. Further, if the purchaser of the 
clothes washer is not the entity paying the energy costs (e.g., a 
tenant), there may be little to no feedback on the purchase. 
Additionally, there are systematic market failures that are likely to 
contribute further complexity to how products are chosen by consumers, 
as explained in the following paragraphs.
---------------------------------------------------------------------------

    \81\ Ward, D.O., Clark, C.D., Jensen, K.L., Yen, S.T., & 
Russell, C.S. (2011): ``Factors influencing willingness-to pay for 
the ENERGY STAR[supreg] label,'' Energy Policy, 39(3), 1450-1458. 
Available at www.sciencedirect.com/science/article/abs/pii/S0301421510009171 (last accessed Feb. 15, 2022).
    \82\ Ward, D.O., Clark, C.D., Jensen, K.L., Yen, S.T., & 
Russell, C.S. (2011): ``Factors influencing willingness-to pay for 
the ENERGY STAR[supreg] label,'' Energy Policy, 39(3), 1450-1458. 
Available at www.sciencedirect.com/science/article/abs/pii/S0301421510009171) (last accessed Feb. 15, 2022).
    \83\ Thaler, R.H., and Sunstein, C.R. (2008). Nudge: Improving 
Decisions on Health, Wealth, and Happiness. New Haven, CT: Yale 
University Press.
---------------------------------------------------------------------------

    The first of these market failures is the split-incentive or 
principal-agent problem. The principal-agent problem is a market 
failure that results when the consumer that purchases the equipment 
does not internalize all of the costs associated with operating the 
equipment. Instead, the user of the product, who has no control over 
the purchase decision, pays the operating costs. There is a high 
likelihood of split-incentive problems in the case of rental properties 
where the landlord makes the choice of what clothes washer to install, 
whereas the renter is responsible for paying energy bills. In addition 
to the split-incentive or principal-agent problem, there are other 
market failures that are likely to affect the choice of clothes washer 
efficiency made by consumers. Lucas Davis and Gilbert Metcalf \84\ 
conducted an experiment demonstrating that the nature of the 
information available to consumers from EnergyGuide labels posted on 
air conditioning equipment results in an inefficient allocation of 
energy efficiency across households with different usage levels. Their 
findings indicate that households are likely to make decisions 
regarding the efficiency of the climate control equipment of their 
homes that are not economically optimal relative to how they utilize 
the equipment (i.e., their decision is based on imperfect information 
and, therefore, is not necessarily optimal).
---------------------------------------------------------------------------

    \84\ Davis, L.W., and G.E. Metcalf (2016): ``Does better 
information lead to better choices? Evidence from energy-efficiency 
labels,'' Journal of the Association of Environmental and Resource 
Economists, 3(3), 589-625. (Available at: www.journals.uchicago.edu/doi/full/10.1086/686252) (Last accessed Feb. 15, 2022).
---------------------------------------------------------------------------

    In part because of the way information is presented, and in part 
because of the way consumers process information, there is also a 
market failure consisting of a systematic bias in the perception of 
equipment energy usage, which can affect consumer choices.
    These market failures affect a sizeable share of the consumer 
population. A study by Houde \85\ indicates that there is a significant 
subset of consumers that appear to purchase appliances without taking 
into account their energy efficiency and operating costs at all.
---------------------------------------------------------------------------

    \85\ Houde, S. (2018): ``How Consumers Respond to Environmental 
Certification and the Value of Energy Information,'' The RAND 
Journal of Economics, 49 (2), 453-477 Available at 
onlinelibrary.wiley.com/doi/full/10.1111/1756-2171.12231 (Last 
accessed Feb. 15, 2022).
---------------------------------------------------------------------------

    The existence of market failures in the residential sector is well 
supported by the economics literature and by a number of case studies. 
If DOE developed an efficiency distribution that assigned clothes 
washer efficiency in the no-new-standards case solely according to 
energy and water use or economic considerations such as life-cycle cost 
or payback period, the resulting distribution of efficiencies within 
the household sample would not reflect any of the market failures or 
behavioral factors above. DOE thus concludes such a distribution would 
not be representative of the clothes washer market. Further, even if a 
specific household is not subject to the market failures above, the 
purchasing decision of clothes washer efficiency can be highly complex 
and influenced by several factors not captured by the information 
available in the RECS samples. These factors can lead to household 
owners choosing a clothes washer efficiency that deviates from the 
efficiency predicted using only energy and water use or economic 
considerations (as calculated using the information from RECS 2015). 
However, DOE intends to investigate this issue further, and it welcomes 
suggestions as to how it might improve its assignment of clothes washer 
efficiency in its analyses.
9. Payback Period Analysis
    The payback period is the amount of time (expressed in years) it 
takes the consumer to recover the additional installed cost of more-
efficient products, compared to baseline products, through energy cost 
savings. 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. DOE 
refers to this as a ``simple PBP'' because it does not consider changes 
over time in operating cost savings. The PBP calculation uses the same 
inputs as the LCC analysis when deriving first-year operating costs.
    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.
10. Other Issues
    Fraas cited a case study of DOE's 2001 RCW standards.\86\ Fraas 
stated that this case study identified several issues that would result 
in lower cost saving estimates than projected in DOE's ex ante 
analyses. These included: (1) reduced product reliability and life; (2) 
additional operation and maintenance costs; and (3) overstatement of 
clothes washer usage relative to DOE's ex ante analysis. Fraas added 
that the case study illustrated the sensitivity of DOE's life cycle 
analysis to different usage and product life assumptions and showed 
that DOE could have improved its analysis by developing distributions 
for key components of its analysis. Finally, Fraas urged DOE to conduct 
a retrospective analysis of its existing standards as part of the 
rulemaking process, including collection of extensive data on usage, 
reliability, and life, to provide a basis for assessing

[[Page 13570]]

prospective energy conservation standards. (Fraas, No. 35 at pp. 1-2)
---------------------------------------------------------------------------

    \86\ The final rule establishing these standards was published 
on January 12, 2001. 66 FR 3313.
---------------------------------------------------------------------------

    DOE has reviewed Fraas & Miller 2020 and identified several 
fundamental misunderstandings in the paper with respect to the 2001 RCW 
rulemaking and standard (with compliance dates of 2004 and 2007). 
Specifically, the paper takes as a premise that the standards finalized 
in 2001 forced consumers to adopt front-loading clothes washers. This 
is fundamentally incorrect. DOE established separate product classes 
and standards for front-loading and top-loading clothes washers. While 
the 2001 standard set the same efficiency level for both of these 
classes, DOE noted in the final rule that there were both top- and 
front-loading clothes washers in the market at all of the efficiency 
levels prescribed in the final rule and that all efficiency levels were 
technologically feasible for both top- and front-loading clothes 
washers. (January 12, 2021; 66 FR 3314, 3318.) Therefore, manufacturers 
were able to choose how to invest in meeting standards across top-
loading and front-loading models. Top-loading clothes washers continue 
to be available for purchase today and consumers may choose them if 
they wish. While there have been changes to top-loading clothes washer 
market share over time, today they have a market share greater than 
70%.
    With regard to reduced product reliability, the paper attempts to 
establish a causal link between regulation and litigation that they 
claim is evidence of reduced product reliability. However, all 
litigation evidence presented in the paper would apply to both baseline 
(pre-standards) and more efficient front-loading clothes washers, and 
there is no causal connection to regulation. The paper ignores past and 
parallel trends in litigation in the market for both the same products, 
and other, similar products. Additionally, there is no counter-factual 
argument.
    With regard to reduced product life, the paper questions the 
estimates used in DOE's lifetime analyses, but compares lifetime 
estimates spanning 23 years. DOE's lifetime estimates are always based 
on the best available data at the time, and were reviewed by 
stakeholders before publishing the final rule. In the follow-up 
rulemaking, culminating in the May 2012 Final Rule, DOE performed a 
statistical analysis of historical shipments data and RECS 2005, which 
resulted in a lifetime estimate consistent with DOE's prior lifetime 
estimate. 10 CFR 430.32. This lifetime methodology is peer-reviewed.
    The argument with respect to additional operation and maintenance 
costs also ignores product class differentiation. Baseline front-
loading units would have the same considerations, and therefore the 
incremental repair rate and operation and maintenance costs of higher 
efficiency units are the relevant parameters for DOE's analyses; these 
are typically negligible.
    With respect to the possible overstatement of clothes washer usage 
relative to DOE's ex ante analysis, DOE again notes that its 
assumptions are based on the latest available data at the time of the 
rulemaking, particularly RECS. For the 2012 rulemaking, the average 
number of loads per year in the analysis decreased, in line with RECS 
2005 results compared to RECS 1993.\87\ Consumer behavior can indeed 
evolve over time.
---------------------------------------------------------------------------

    \87\ Department of Energy--Energy Information Administration, 
Residential Energy Consumption Survey, 1993 and 2005. Available at 
www.eia.gov/consumption/residential/.
---------------------------------------------------------------------------

    Regarding the point that DOE could have improved its analysis by 
developing distributions for key components of its analysis, DOE notes 
that in the current rulemaking, lifetime, usage, energy consumption, 
and discount rates, among other things, are all characterized by 
distributions.
    With respect to the recommendation to conduct a retrospective 
analysis as part of this rulemaking, DOE acknowledges that parameters 
such as lifetime and product usage can change over time. In this 
rulemaking, DOE uses the best available data to develop new estimates 
of such parameters. To the extent that the estimates have changed over 
time, this is not evidence that DOE could have made a better assumption 
in the previous rulemakings, as it was relying on the best available 
data at that time, and the difference between estimates in two years 
would not be sufficient to make adjustments to estimates in future 
years.
    For all of the previous reasons, DOE is not making any methodology 
changes to its analyses, but it updated inputs based on data 
availability including repair and maintenance costs, energy and water 
usage, product lifetime, and product efficiency distribution.

G. Shipments Analysis

    DOE uses projections of annual product shipments to calculate the 
national impacts of potential amended energy conservation standards on 
energy use, NPV, and future manufacturer cash flows.\88\ 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.
---------------------------------------------------------------------------

    \88\ 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.
---------------------------------------------------------------------------

    To project RCW shipments under the no-new-standards case, DOE 
utilized historical shipments data from AHAM. DOE estimated RCW 
shipments by projecting shipments into two market segments: (1) 
replacement of existing RCWs; (2) new housings.
    To project RCW replacement shipments, DOE developed retirement 
functions from RCW lifetime estimates and applied them to the existing 
products in the housing stock, which are tracked by vintage. To 
estimate shipments to new housings, DOE used projections of new housing 
starts coupled with RCWs' saturation data. In other words, to project 
the shipments for new housings for any given year, DOE multiplied the 
housing projections by the estimated saturation of RCWs for new housing 
units. For new housing completions and mobile home placements, DOE used 
recorded data through 2020,\89\ and adopted the projections from 
AEO2022 for 2021-2050. DOE used the data contained in the 2015 RECS to 
characterize ownership of RCWs in households across various housing 
types, including multi-family housing.
---------------------------------------------------------------------------

    \89\ U.S. Census. Characteristics of New Housing. Available at 
www.census.gov/construction/chars/.
---------------------------------------------------------------------------

    DOE then aggregated the above two market segments for any given 
year during the analysis period (2027-2056) and divided total RCW 
shipments into its five product classes. For this NOPR, DOE estimated 
the market share between top-loading and front-loading clothes washers 
would remain at the current level based on the historical shipments 
data by washer loading type (2004-2021) provided by AHAM. (AHAM, No. 
40, at p. 11) DOE estimated market share for top-loading and front-
loading clothes washers would remain at 75 percent and 25 percent, 
respectively. DOE then disaggregated top-loading clothes washer market 
share into three product classes (i.e., semi-automatic, ultra-compact, 
and standard-size) and front-loading into two product classes (i.e., 
compact and standard-size). In addition, DOE assumed annual growth rate 
for semi-automatic and top-loading ultra-compact clothes washers

[[Page 13571]]

would be at 0.2 percent. Table IV.34 shows the estimated market share 
and shipments for each product class.

    Table IV.34--Market Share and Shipments by Product Class in 2027
------------------------------------------------------------------------
                                           Market share      Shipments
              Product class                     (%)          (million)
------------------------------------------------------------------------
Semi-Automatic..........................             1.6            0.16
Top-Loading, Ultra-Compact..............             0.5            0.05
Top-Loading, Standard-Size..............            72.9            7.54
Front-Loading, Compact..................             1.6            0.16
Front-Loading, Standard-Size............            23.4            2.42
                                         -------------------------------
    Total...............................             100           10.35
------------------------------------------------------------------------

    DOE seeks comment on the approach and inputs used to develop no-new 
standards case shipments projection and market share for each product 
class.
    To project RCW shipments under a standards-case, DOE used a price 
elasticity parameter, which relates the incremental total installed 
cost to total RCW shipments, and an efficiency elasticity parameter, 
which relates the change in the operating cost to RCW shipments. Both 
types of elasticity relate changes in demand to changes in the 
corresponding characteristic (price or efficiency). A regression 
analysis estimated these terms separately from each other and found 
that the price elasticity of demand for several appliances is on 
average -0.45.\90\ Thus, for example, a price increase of 10 percent 
would result in a shipments decrease of 4.5 percent, all other factors 
held constant. The same regression analysis found that the efficiency 
elasticity is estimated to be on average 0.2 (i.e., a 10-percent 
efficiency improvement, equivalent to a 10-percent decrease in 
operating costs, would result in a shipments increase of 2 percent, all 
else being equal).
---------------------------------------------------------------------------

    \90\ Fujita, S., Estimating Price Elasticity using Market-Level 
Appliance Data. LBNL-188289 (August 2015). Available at: eta-publications.lbl.gov/sites/default/files/lbnl-188289.pdf.
---------------------------------------------------------------------------

    DOE assumed when market impact occurs, i.e., when shipments drop 
under a standards-case, the affected consumers would repair their 
product rather than replace it. Under this method, DOE does not assume 
that consumers completely forgo the use of the product. The model 
instead assumes about the length of time that the life of the product 
is extended. This market impact is thus effectively applied to the 
repair or replacement decision. The second-hand market for used 
appliances is a potential alternative to consumers purchasing a new 
unit or repairing a broken unit. An increase in the purchases of older, 
less-efficient second-hand units due to a price increase resulting from 
a more stringent standard could potentially decrease projected energy 
savings. DOE assumed that purchases on the second-hand market would not 
change significantly due to the proposed standard level and did not 
include their impact on product shipments.
    DOE requests data on the market size and typical selling price of 
units sold through the second-hand market for residential clothes 
washers.
    ASAP et al. encouraged DOE to more thoroughly model market shifts 
under standards implementations. ASAP et al. commented that in the 
September 2021 Preliminary TSD, DOE's logistic regression model that 
captured the relationship between the market share of front- and top-
loading clothes washers, their prices, and their energy usage indicates 
that the front-loading market share is negatively correlated with top-
loading price and energy usage. ASAP et al. therefore commented that 
the model predicts that the front-loading market share will decrease if 
higher standards are implemented for both top- and front-loading 
clothes washers. However, ASAP et al. noted that the estimated average 
price difference between front-loading and top-loading clothes washers 
is $323 at the baseline versus only $186 at EL 4. ASAP et al. stated 
that it is plausible that increasing standards could move the market 
towards, rather than away from, front-loading clothes washers. ASAP et 
al. therefore suggested that DOE should analyze how estimated first 
costs for each product class may affect market share projections. (ASAP 
et al., No. 37 at pp. 4-5)
    The consumer choice model developed under the September 2021 
Preliminary Analysis lacked historical retail pricing, sales data, and 
clothes washer energy use data necessary for DOE to project market 
share between front-loading and top-loading RCWs, directly using their 
first cost and sales data as suggested by ASAP et al. DOE explored a 
method, but the regression statistic results indicate a low R-squared, 
which means the predicted model would not fit with the historical 
market share data. Recent historical shipments data presented by AHAM 
(AHAM, No. 40, at p. 11) indicate that the proportion of front-loading 
clothes washers compared to total clothes washer shipments appears to 
have leveled off. Therefore, for this NOPR analysis, DOE used a frozen 
scenario for market shifting (e.g., no market shifting) under the 
standards case.
    For details on the shipments analysis, see chapter 9 of the NOPR 
TSD.

H. National Impact Analysis

    The NIA assesses the national energy savings (NES), national water 
savings (NWS), 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. (``Consumer'' in this 
context refers to consumers of the product being regulated.) DOE 
calculates the NES, NWS, and NPV for the potential standard levels 
considered based on projections of annual product shipments, along with 
the annual energy and water consumption and total installed cost data 
from the energy and water use and LCC analyses. For the present 
analysis, DOE projected the energy and water savings, operating cost 
savings, product costs, and NPV of consumer benefits over the lifetime 
of RCWs sold from 2027 through 2056.
    DOE evaluates the impacts of 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

[[Page 13572]]

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 and water 
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.35 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.35--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
                                     shipments-weighted efficiency
                                     improvement of 0.4 percent for top-
                                     loading standard-size and 0.1
                                     percent for both front-loading
                                     compact and standard-size clothes
                                     washers.
                                    Standards cases: ``Roll up''
                                     equipment to meet potential
                                     efficiency level.
Annual Energy and Water             Annual weighted-average values are a
 Consumption per Unit.               function of energy and water use at
                                     each TSL.
Total Installed Cost per Unit.....  Annual weighted-average values are a
                                     function of cost at each TSL.
                                     Incorporates projection of future
                                     product prices based on historical
                                     data.
Annual Energy and Water Cost per    Annual weighted-average values as a
 Unit.                               function of the annual energy and
                                     water consumption per unit and
                                     energy and water prices.
Repair and Maintenance Cost per     Annual values change between non-
 Unit.                               ENERGY STAR and ENERGY STAR
                                     efficiency levels.
Energy and Water Price Trends.....  AEO2022 projections (to 2050) and
                                     constant value based on average
                                     between 2046-2050 thereafter.
                                     Historical PPI extrapolated
                                     projection (to 2050) and constant
                                     value based on average between 2046-
                                     2050 thereafter.
Energy Site-to-Primary and FFC      A time-series conversion factor
 Conversion.                         based on AEO2022.
Discount Rate.....................  3 percent and 7 percent.
Present Year......................  2022.
------------------------------------------------------------------------

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 standard. To project the trend in efficiency absent amended 
standards for RCWs over the entire shipments projection period, DOE 
considered recent trends in DOE's CCD data and the potential effect of 
programs such as ENERGY STAR. As discussed in section IV.F.8 of this 
document, DOE estimated an annual efficiency improvement of 0.4 and 0.1 
percent for top-loading standard-size and front-loading (compact and 
standard-size) clothes washers, respectively.
    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 and Water Savings
    The national energy and water savings analysis involves a 
comparison of national energy and water consumption of the considered 
products between each potential standards case (or TSL) and the case 
with no amended energy conservation standards. DOE calculated the 
national energy and water consumption by multiplying the number of 
units (stock) of each product (by vintage or age) by the unit energy 
and water consumption (also by vintage). DOE calculated annual NES and 
NWS based on the difference in national energy and water 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 AEO2022. 
Cumulative energy and water savings are the sum of the NES and NWS 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. As described in section 
IV.E.2, DOE did not find any data on the rebound effect specific to 
RCWs and did not apply a rebound effect.
    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 NAS, 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 \91\ that EIA uses to

[[Page 13573]]

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 
and 13A of the NOPR TSD.
---------------------------------------------------------------------------

    \91\ 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/outlooks/aeo/nems/documentation/archive/pdf/0581(2009).pdf. (last accessed June 12, 2022).
---------------------------------------------------------------------------

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 and water 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 RCW 
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 RCW price is projected to drop 14.4 percent relative to 2021. 
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 RCWs. In 
addition to the default price trend, DOE considered two product price 
sensitivity cases: (1) a high price decline case based on PPI data for 
the period 1980-2021 and (2) a low price decline case based on PPI data 
for the period 1948-1979. The derivation of these price trends and the 
results of these sensitivity cases are described in appendix 10C of the 
NOPR TSD.
    The energy and water cost savings are calculated using the 
estimated energy and water savings in each year and the projected price 
of the appropriate form of energy and water. To estimate energy prices 
in future years, DOE multiplied the average regional energy prices by 
the projection of annual national-average residential energy price 
changes in the Reference case from AEO2022, which has an end year of 
2050. To estimate price trends after 2050, the 2046-2050 average was 
used for all years. To estimate water prices in future years, DOE 
multiplied the average national water prices by the projection of 
annual national-average residential water price changes in the 
extrapolated future water price trend, which is based on the historical 
water price index from 1988 to 2021. To estimate price trends after 
2050, DOE used a constant value derived from the average values from 
2046 through 2050. As part of the NIA, DOE also analyzed scenarios that 
used inputs from variants of the AEO2022 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 10C 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.\92\ The discount rates 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.
---------------------------------------------------------------------------

    \92\ United States Office of Management and Budget. Circular A-
4: Regulatory Analysis. September 17, 2003. Section E. Available at 
obamawhitehouse.archives.gov/omb/circulars_a004_a-4/ (last accessed 
June 12, 2022).
---------------------------------------------------------------------------

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. The sections below discuss the individual subgroups, 
and additional details are found in chapter 11 of the NOPR TSD.
1. Low-Income Households
    Low-income households are significantly more likely to be renters 
or to live in subsidized housing units, compared to households that are 
not low-income. In these cases, the landlord purchases the equipment 
and may pay the energy bill as well.
    The CA IOUs recommended that DOE consider adjustments to its 
consumer subgroup analysis by creating a low-income renter subgroup. 
The CA IOUs commented that it is more likely that the incremental 
clothes washer purchase costs to the average low-income household would 
be paid by a landlord and passed along to the low-income household 
across multiple months, such that the benefits of lower energy and 
water costs would offset the incremental cost increases of higher 
efficiency products. (CA IOUs, No. 43 at pp. 1-2)
    NYSERDA recommended that DOE conduct additional analysis on the 
implications to renters as part of its low-income consumer subgroup 
assessment. NYSERDA noted that within low-income households, there are 
important distinctions between renters and owners, and renters often 
bearing the operational costs of energy and water with limited input on 
the choice of products. (NYSERDA, No. 36 at p. 2)
    For this NOPR analysis, DOE divided low-income households into 
three sub-subgroups: (1) renters who pay energy bill; (2) renters who 
do not pay energy bill; and (3) homeowners. The 2015 RECS includes data 
on whether a household pays for the energy bill, allowing DOE to 
categorize households in the analysis narrowly,\93\ excluding any costs 
or benefits that are accrued by either a landlord or subsidized housing 
agency. This allows DOE to determine whether low-income households are 
disproportionately affected by an amended energy conservation standard 
in a more accurate manner. Table IV.36 shows the distribution of low-
income

[[Page 13574]]

household clothes washer users with respect to whether they rent or own 
and whether they pay the energy bill.
---------------------------------------------------------------------------

    \93\ The energy bill includes fuel type of electricity, natural 
gas, or propane consumed by a household.

                                Table IV--36 Characterization of Low-Income Households in the Sample for Clothes Washers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Percentage of low-income sample
                                      -----------------------------------------------------------------
                                                                       Semi-automatic,                      Impact of higher       Impact of first cost
         Type of household *            Top-loading,   Front-loading,    top-loading,   Front-loading,    efficiency on energy           increase
                                       standard- size  standard- size   Ultra-compact     compact (%)             bill
                                             (%)             (%)             (%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Renters (Pay for Energy Bill) **.....              37              28               50              41  Full/Partial savings...  None.***
Renters (Do Not Pay for Energy Bill)                5               4               11              14  None...................  None.***
 **.
Owners...............................              58              69               39              46  Full/Partial savings...  Full.
--------------------------------------------------------------------------------------------------------------------------------------------------------
* RECS 2015 lists three categories: (1) Owned or being bought by someone in your household (here classified as ``Owners'' in this table); (2) Rented
  (here classified as ``Renters'' in this table); (3) Occupied without payment of rent (also classified as ``Renters'' in this table). Renters include
  occupants in subsidized housing including public housing, subsidized housing in private properties, and other households that do not pay rent. RECS
  2015 does not distinguish homes in subsidized or public housing.
** RECS 2015 lists four categories for each of the fuels used by a household: (1) Household is responsible for paying for all used in this home; (2) All
  used in this home is included in the rent or condo fee; (3) Some is paid by the household, some is included in the rent or condo fee; and 4) Paid for
  some other way. ``Do Not Pay for Energy Bill'' includes only category (2). Partial energy bill savings would occur in cases of category (3).
*** Low-income renters typically do not purchase a clothes washer. Therefore, it is unclear if the renters would be asked to pay the full or partial of
  the total installed cost. As a result, DOE estimated there would be no impact of first cost increase for low-income renters and occupants in public
  housing and other households that do not pay rent.

    AHAM commented that increased efficiency standards would eliminate 
the lowest priced top-loading RCWs, which would have a 
disproportionate, negative impact on low-income households. AHAM added 
that, while low-income consumers would receive payback over time due to 
savings on utility bills, these consumers are unlikely to have the 
extra funds to pay for a more efficient, but more expensive RCW. (AHAM, 
No. 40 at pp. 12-13)
    Whirlpool expressed concern about the impacts of amended standards 
on low-income consumers and believe that amended standards for clothes 
washers could have potentially devastating impacts on racial and 
economic equity. Whirlpool commented that any increase to purchase cost 
driven by amended standards may be difficult or impossible for many 
low-income households to accept and may further widen the equity gap 
rather than help close it. (Whirlpool, No. 39 at pp. 16-17)
    As described in section V.B.1 of this document, the percent of low-
income RCW consumers experiencing a net cost at the proposed standard 
level (TSL 4) is smaller (13 percent for top-loading standard-size 
washers) than in the full LCC sample (25 percent for top-loading 
standard-size washers). The main reason is that a high portion of low-
income household renters would not have to pay the total cost of a 
higher-efficiency washer because renters do not select nor pay for the 
clothes washer itself (CA IOUs, No.43 at pp. 1-2).
2. Senior-Only Households
    Annual clothes washer usage for senior-only households is 
significantly less than the full household sample because the household 
size for senior-only families is typically either one or two people. A 
household size equal to or larger than three members accounts for only 
8 percent of senior-only households. Therefore, as described in section 
V.B.1 of this document, the percentage of senior-only RCW consumers 
experiencing a net cost at the TSL 4 is greater (35 percent for top-
loading standard-size washers) than in the full LCC sample (25 percent 
for top-loading standard-size washers). The simple payback period for 
senior-only households at TSL 4 is 2 years longer than in the full LCC 
sample.
    For households who would be negatively impacted by amended energy 
conservation standards, a potential rebate program to reduce the total 
installed costs would be effective in lowering the percentage of 
consumers with a net cost and reducing simple payback period. DOE is 
aware of 80 rebate programs currently available for residential clothes 
washers meeting ENERGY STAR requirements initiated by 63 organizations 
in various States as described in chapter 17 of the NOPR TSD.\94\ DOE 
is seeking comment about how amended energy conservation standards may 
impact the low-income and senior-only consumer economics being 
presented and considered in this proposed rulemaking.
---------------------------------------------------------------------------

    \94\ As of June, 2022, 80 rebate programs were available for 
residential clothes washers meeting ENERGY STAR requirements: 
www.energystar.gov/rebate-finder?scrollTo=363.6363525390625&sort_by=utility&sort_direction=asc&page_number=0&lastpage=0&zip_code_filter=&search_text=&product_clean_filter=Clothes+Washers&product_clean_isopen=0&product_types=Select+a+Product+Category.
---------------------------------------------------------------------------

    DOE is seeking comment about definable subpopulations in addition 
to low-income and senior-only households and the associated data 
required to differentiate how such subpopulation use clothes washers.
    Chapter 11 in the NOPR TSD describes the consumer subgroup 
analysis.

J. Manufacturer Impact Analysis

1. Overview
    DOE performed an MIA to estimate the financial impacts of amended 
energy conservation standards on manufacturers of RCWs and to estimate 
the potential impacts of such standards on direct 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 employment, capacity, 
and competition, as well as how standards contribute to overall 
regulatory burden. Finally, the MIA serves to identify any 
disproportionate

[[Page 13575]]

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 standards cases (i.e., TSLs). 
To capture the uncertainty relating to manufacturer pricing strategies 
following amended standards, the GRIM estimates a range of possible 
impacts under different 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 RCW manufacturing industry 
based on the market and technology assessment and publicly-available 
information. This included a top-down analysis of RCW manufacturers 
that DOE used to derive preliminary financial inputs for the GRIM 
(e.g., revenues; materials, labor, overhead, and depreciation expenses; 
selling, general, and administrative expenses (``SG&A''); and R&D 
expenses). DOE also used public sources of information to further 
calibrate its initial characterization of the RCW manufacturing 
industry, including company filings of Form 10-Ks from the SEC,\95\ 
corporate annual reports, the U.S. Census Bureau's Annual Survey of 
Manufactures (``ASM''),\96\ and reports from Dun & Bradstreet.\97\
---------------------------------------------------------------------------

    \95\ U.S. Securities and Exchange Commission, Electronic Data 
Gathering, Analysis, and Retrieval (EDGAR) system. Available at: 
www.sec.gov/edgar/search/ (Last accessed July 1, 2022).
    \96\ U.S. Census Bureau, Annual Survey of Manufactures. 
``Summary Statistics for Industry Groups and Industries in the U.S 
(2020).'' Available at: www.census.gov/data/tables/time-series/econ/asm/2018-2020-asm.html (Last accessed July 15, 2022).
    \97\ The Dun & Bradstreet Hoovers login is available at: 
app.dnbhoovers.com (Last accessed July 15, 2022).
---------------------------------------------------------------------------

    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 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 RCWs 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 (``LVMs''), 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 RCWs, 
DOE used a real discount rate of 9.3 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 and 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 products is typically more expensive 
than manufacturing baseline products 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.

[[Page 13576]]

DOE conducted this analysis using the physical teardown approach. The 
resulting bill of materials provides the basis for the MPC estimates. 
In this proposed rulemaking, DOE relies on an efficiency-level 
approach, supplemented with the design-option approach for certain 
``gap fill'' efficiency levels. The efficiency-level approach is 
appropriate for RCWs, given the availability of certification data to 
determine the market distribution of existing products and to identify 
efficiency level ``clusters'' that already exist on the market. 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. 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 information derived from manufacturer interviews, the 
engineering analysis, and product teardowns to evaluate the level of 
capital and product conversion costs manufacturers would likely incur 
at the various TSLs. During 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, 
engineering resources, and marketing expenses 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 also estimated industry costs associated with 
re-rating basic models in accordance with Appendix J, as detailed in 
the June 2022 TP Final Rule. 87 FR 33316. Manufacturer data was 
aggregated to better reflect the industry as a whole and to protect 
confidential information. DOE then scaled up the aggregate capital and 
product conversion cost feedback from interviews to estimate total 
industry conversion costs.
    DOE acknowledges that manufacturers may follow different design 
paths to reach the various efficiency levels analyzed. An individual 
manufacturer's investments depend on a range of factors, including the 
company's current product offerings and product platforms, existing 
production facilities and infrastructure, and make vs. buy decisions 
for components. DOE's conversion cost methodology incorporated feedback 
from all manufacturers that took part in interviews and extrapolated 
industry values. While industry average values may not represent any 
single manufacturer, DOE's modeling provides reasonable estimates of 
industry-level investments.
    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 the manufacturer markups in the standards 
case yields different sets of impacts on manufacturers. For the MIA, 
DOE modeled two standards-case 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 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 
18 percent for all product classes.\98\ 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 of industry profitability under an amended 
energy conservation standard.
---------------------------------------------------------------------------

    \98\ The gross margin percentage of 18 percent is based on a 
manufacturer markup of 1.22.
---------------------------------------------------------------------------

    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 expected 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 takes effect.

[[Page 13577]]

    A comparison of industry financial impacts under the two scenarios 
is presented in section V.B.2.a of this document.
3. Manufacturer Interviews
    DOE interviewed manufacturers representing approximately 82 percent 
of domestic RCW industry shipments. Participants included domestic-
based and foreign-based original equipment manufacturers (``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 RCWs. 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 DOE's responses throughout the rest of this document.
a. Product Classes
    In interviews, manufacturers had differing views on the appropriate 
RCW product class structure. Generally, manufacturers specializing in 
standard-size front-loading clothes washers recommended that DOE 
combine product classes and remove the product class delineation based 
on load configuration. These manufacturers emphasized that front-
loading clothes washers are more efficient than top-loading 
counterparts. These manufacturers noted that even energy-conscious 
consumers often just look for the ENERGY STAR certification and are 
unaware of the energy usage differences between top-loading and front-
loading models.
    Several manufacturers recommended an array of updates to the 
product class structure as it relates to the classification of 
standard-size versus compact-size products. Some manufacturers 
suggested differentiating product classes based on cabinet width 
instead of tub capacity. These manufacturers noted that consumers often 
purchase compact front-loading RCWs due to size constraints at the 
installation location. Other manufacturers encouraged DOE to align the 
capacity cutoff for top-loading compact clothes washers with the 
capacity cutoff for front-loading compact clothes washers analyzed in 
the September 2021 Preliminary Analysis (i.e., 3.0 ft\3\). 86 FR 53886. 
Some manufacturers suggested splitting up the standard-size product 
classes by varying cabinet-size (or capacity) thresholds. One 
manufacturer noted that entry-level products are typically on the 
smaller side, with capacities under 4.0 ft\3\. These smaller standard-
size products are often less expensive than larger capacity RCW models. 
Additionally, the technology options may vary based on capacity. For 
example, this manufacturer asserted that larger capacity models can 
better handle increased spin speeds and have an inherent advantage for 
efficiency ratings due to the larger weighted-average load-size 
compared to smaller capacity models.
b. Ability To Serve Certain Consumer Segments
    In interviews, manufacturers emphasized that consumer preferences 
vary and as a result, there are a range of RCW models available that 
appeal to different consumer segments. Currently, manufacturers balance 
achieving energy and water efficiency metrics with other 
considerations, such as cycle time, noise levels, fabric care, cleaning 
performance, and upfront cost. Multiple manufacturers expressed 
concerns about their ability to meet some consumer requirements under 
amended standards. For instance, several manufacturers stated that they 
would need to increase cycle times at certain efficiencies to recover 
cleaning performance at reduced water levels. These manufacturers noted 
that consumers often expect wash cycle times to align with dryer cycle 
times. Other manufacturers expressed concerns about diminished fabric 
care and heightened noise under levels that require notably faster spin 
speeds. Some manufacturers stated that it would require significant 
engineering time and capital investment to develop a range of platforms 
that meet more stringent energy standards as well as a range of 
consumer performance requirements. A few manufacturers recommended DOE 
explore instituting a cleaning performance metric, like the concept 
proposed for dishwashers in a NOPR published on December 22, 2021. 86 
FR 72738.
    Some manufacturers stated that a large segment of 
``traditionalist'' consumers prefer ``traditional'' top-loading RCWs 
with specific characteristics and the manufacturers asserted that more 
stringent standards would threaten the viability of these 
``traditional'' top-loading clothes washers that met requirements of 
this consumer segment. These manufacturers described ``traditionalist'' 
consumers as preferring top-loading clothes washers with agitators, 
visible water levels, and flexible (i.e., manual) fill options. 
Specifically, manufacturers stated that an agitator design would not be 
feasible at or above the current ENERGY STAR level (EL 2). Some 
manufacturers asserted, based on their product research and reported 
shifts in consumer demand for agitator washers, that some 
``traditionalist'' consumers would be dissatisfied with top-loading 
designs that lacked the agitator and instead used a wash plate. One 
manufacturer noted that they recently introduced RCWs with agitators 
due to consumer preferences for such features.
    Several manufacturers also noted that amending standards would 
raise the cost of baseline RCWs, which would disproportionately impact 
low-income consumers since they typically purchase entry-level, 
``traditional'' top-loading clothes washers. These manufacturers raised 
concerns about their future ability to offer low-cost RCWs and serve 
the low-income consumer market under amended standards.
c. Supply Chain Constraints
    In interviews, some manufacturers expressed concerns about 
potential supply chain constraints. Those manufacturers noted concerns 
about the ongoing supply constraints for microprocessors and 
electronics. Any shift towards direct drive motors would require that 
industry source more advanced microprocessors, which are already 
difficult to secure. Some manufacturers were also uncertain about 
industry's ability to source enough direct drive motors--particularly 
for standard-size top-loading clothes washers--to meet market demand at 
and above the current ENERGY STAR level (EL 2). Manufacturers asserted 
that if these supply constraints continue through the end of the 
conversion period, industry could face production capacity constraints.
4. Discussion of MIA Comments
    In response to the September 2021 Preliminary Analysis, AHAM urged 
DOE to consider alternative approaches to cumulative regulatory burden. 
AHAM encouraged 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, No. 
40 at p. 7) AHAM noted other regulations impact RCW manufacturers such 
as consumer clothes dryers, commercial clothes washers,

[[Page 13578]]

consumer refrigerator/freezers, miscellaneous refrigeration products, 
cooking products, dishwashers, room air conditioners, dehumidifiers, 
and portable air conditioners rulemakings. (AHAM, No. 40 at p. 8) 
Additionally, AHAM requested that DOE include the cost of monitoring 
test procedure and energy conservation standard rulemakings in its 
rulemaking analyses. (Id.)
    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 make it more 
difficult to discern the direct impact of the amended standard on 
covered 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.
    To consider to costs of monitoring test procedure and energy 
conservation standard rulemakings, 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.
    AHAM requested DOE plan its rulemaking process such that the 
compliance dates for residential clothes washers and clothes dryers are 
identical or very nearly identical. AHAM further explained that this 
would allow manufacturers to design these products simultaneously to 
meet amended standards and so that there is less confusion for 
manufacturers, retailers, and consumers as products would need to be 
re-floored leading up to and on the compliance date of any amended 
energy conservation standards. (AHAM, No. 40 at pp. 7-8) Whirlpool also 
stated that if DOE decides to amend standards for both clothes washers 
and clothes dryers, then compliance dates should be aligned to allow 
for manufacturers to invest in clothes washers and clothes dryers as a 
pair, which prevents unnecessary cost, confusion, and burden for 
manufacturers and retailers. (Whirlpool, No. 39 at p. 20) Whirlpool 
added that it believes DOE has the statutory authority to align these 
compliance dates. (Id.)
    Pursuant to a consent decree entered on September 20, 2022, DOE has 
agreed to sign and post on DOE's publicly accessible website a 
rulemaking document for RCWs and consumer clothes dryers by February 
29, 2024, that, when effective, would be DOE's final agency action for 
standards for these products.\99\ As such, DOE expects that, if these 
two rulemakings result in amended energy conservations standards, the 
compliance dates would be similar.
---------------------------------------------------------------------------

    \99\ Natural Resources Defense Council, Inc., et al. v Granholm, 
et al., No. 1:20-cv-09127 (S.D.N.Y.), and State of New York, et al. 
v Granholm, et al. No. 1:20-cv-09362 (S.D.NY).
---------------------------------------------------------------------------

    Whirlpool stated that more stringent standards would 
disproportionately harm the company due to its broad lineup of RCWs 
that includes broad offerings at entry-level price points. Whirlpool 
noted that the company would need to devote a high level of engineering 
resources to incorporate design options such as stainless-steel wash 
baskets, wash plates, direct drive motors, and product structural 
changes. Whirlpool added that moving from traditional agitators to 
high-efficiency agitators or wash plates would lead to increased costs 
associated with redesigning models and retooling factories. In 
contrast, Whirlpool emphasized that many competitors would not need to 
make additional investments to meet amended standards since they cater 
to a more targeted consumer segment. (Whirlpool, No. 39 at p. 18)
    DOE uses the GRIM, as described in section IV.J.2, to determine the 
quantitative impacts on the RCW industry as a whole. Impacts on 
individual manufacturers may vary from industry averages due to a wide 
range of company-specific factors including, but not limited to, 
differences in efficiency of current product offerings, production 
volumes, and legacy investments in manufacturing plants. DOE recognizes 
that the industry impacts do not apply evenly across manufacturers. 
However, as many of the GRIM inputs (e.g., industry financials) account 
for U.S. market share weights, the GRIM is most reflective of large 
manufacturers, like Whirlpool. Additionally, DOE's modeling 
incorporates estimate conversion costs associated with the product 
changes, such as stainless-steel wash baskets, wash plates, direct 
drive motors, and product structural enhancements, identified by 
Whirlpool.
    Whirlpool expressed concern that direct drive and BPM motors are 
more expensive than PSC motors. (Whirlpool, No. 39 at p. 6) DOE 
incorporates the higher cost of direct drive and BPM motors in its 
engineering analysis, as discussed in section IV.C.4 of this document.
    Whirlpool noted concerns about being able to secure an adequate 
domestic supply of direct drive motors, if DOE amends standard, since 
direct drive motors typically come from foreign suppliers. (Whirlpool, 
No. 39 at p. 6) Samsung commented that direct drive motors have matured 
over the years and have become highly cost competitive. (Samsung, No. 
41 at pp. 2-3) More stringent standards would likely necessitate 
adoption of more efficient technologies, such as direct drive motors. 
DOE notes that amended standards, if adopted, could provide regulatory 
certainty for manufacturers and suppliers to establish additional 
capacity in the supply chain.
    DOE seeks comment on the availability of direct drive motors in 
quantities required by industry if DOE were to adopt amended standards.

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 AEO2022. Power sector 
emissions of CH4 and N2O from fuel combustion are 
estimated using Emission Factors for Greenhouse Gas Inventories 
published by the EPA.\100\
---------------------------------------------------------------------------

    \100\ Available at www.epa.gov/sites/production/files/2021-04/documents/emission-factors_apr2021.pdf (last accessed June 12, 
2022).
---------------------------------------------------------------------------

    The on-site operation of RCWs requires combustion of fossil fuels 
and results in emissions of CO2, NOX, 
SO2

[[Page 13579]]

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.\101\
---------------------------------------------------------------------------

    \101\ 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 
June 12, 2022).
---------------------------------------------------------------------------

    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 MWh or 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. AEO2022 generally represents current 
legislation and environmental regulations, including recent government 
actions, that were in place at the time of preparation of AEO2022, 
including the emissions control programs discussed in the following 
paragraphs.\102\
---------------------------------------------------------------------------

    \102\ For further information, see the Assumptions to AEO2022 
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 June 12, 2022).
---------------------------------------------------------------------------

    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 (D.C.). (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.\103\ AEO2022 
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.
---------------------------------------------------------------------------

    \103\ 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 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 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 AEO2022.
    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 AEO2022 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 
AEO2022, 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 considered in 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

[[Page 13580]]

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 benefits where 
appropriate and permissible under law. DOE requests comment on how to 
address the climate benefits and other non-monetized effects 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 social cost (``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 proposed rulemaking 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 (``February 2021 SC-
GHG TSD''). 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, 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, peer-reviewed methodologies, the best 
science available at the time of that process, and with input from the 
public. Specifically, in 2009, the IWG, which included 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 (i.e., 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'') 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 social cost of methane (i.e., SC-
CH4) and nitrous oxide (i.e., 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.\104\ 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).\105\ 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.
---------------------------------------------------------------------------

    \104\ Marten, A.L., E.A. Kopits, C.W. Griffiths, S.C. Newbold, 
and A. Wolverton. Incremental CH4 and N2O 
mitigation benefits consistent with the U.S. Government's SC-
CO2 estimates. Climate Policy. 2015. 15(2): pp. 272-298.
    \105\ 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

[[Page 13581]]

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 omitted effects 
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 SC-GHG 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,\106\ and 
recommended that discount rate uncertainty and relevant aspects of 
intergenerational ethical considerations be accounted for in selecting 
future discount rates.
---------------------------------------------------------------------------

    \106\ Interagency Working Group on Social Cost of Carbon. Social 
Cost of Carbon for Regulatory Impact Analysis under Executive Order 
12866. 2010. United States Government. (Last accessed April 15, 
2022.) www.epa.gov/sites/default/files/2016-12/documents/scc_tsd_2010.pdf; 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. (Last accessed 
April 15, 2022.) www.federalregister.gov/documents/2013/11/26/2013-28242/technical-support-document-technical-update-of-the-social-cost-of-carbon-for-regulatory-impact; 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. 
(Last accessed January 18, 2022.) www.epa.gov/sites/default/files/2016-12/documents/sc_co2_tsd_august_2016.pdf; 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. (Last accessed January 
18, 2022.) www.epa.gov/sites/default/files/2016-12/documents/addendum_to_sc-ghg_tsd_august_2016.pdf.
---------------------------------------------------------------------------

    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- 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 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 SC-GHG 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

[[Page 13582]]

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 the above 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 use 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 were 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.\107\ 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 SC-GHG TSD, the IWG has recommended 
that, taken together, 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.
---------------------------------------------------------------------------

    \107\ 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/.
---------------------------------------------------------------------------

    DOE's derivations of the 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 for IWG's February 2021 SC-GHG TSD. Table IV.37 shows 
the updated sets of SC-CO2 estimates from the IWG's February 
2021 SC-GHG TSD in 5-year increments from 2020 to 2050. The full set of 
annual values that DOE 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 include all four 
sets of SC-CO2 values, as recommended by the IWG.\108\
---------------------------------------------------------------------------

    \108\ For example, the February 2021 SC-GHG 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.37--Annual SC-CO2 Values From 2021 Interagency Update, 2020-2050 (2020$ per Metric Ton CO2)
----------------------------------------------------------------------------------------------------------------
                                                                    Discount rate and statistic
                                                 ---------------------------------------------------------------
                                                        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
----------------------------------------------------------------------------------------------------------------


[[Page 13583]]

    For 2051 to 2070, DOE used SC-CO2 estimates published by 
EPA, adjusted to 2020$.\109\ 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 RCWs after 2070, but a lack of available SC-
CO2 estimates for emissions years beyond 2070 prevents DOE 
from monetizing these potential benefits in this analysis.
---------------------------------------------------------------------------

    \109\ See EPA, Revised 2023 and Later Model Year Light-Duty 
Vehicle GHG Emissions Standards: Regulatory Impact Analysis, 
Washington, DC, December 2021. Available at: www.epa.gov/system/files/documents/2021-12/420r21028.pdf (last accessed January 13, 
2022).
---------------------------------------------------------------------------

    DOE multiplied the CO2 emissions reduction estimated for 
each year by the SC-CO2 value for that year in each of the 
four cases. DOE adjusted the values to 2021$ using the implicit price 
deflator for gross domestic product (``GDP'') from the Bureau of 
Economic Analysis. 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.
    AHAM cautioned against DOE using 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. AHAM stated that 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 TSLs DOE selects as a new or amended standard. (AHAM, No. 40 at p. 
32)
    As stated in section III.F.1.f of this document, DOE maintains that 
environmental and public health benefits associated with the more 
efficient use of energy, including those connected to global climate 
change, are important to take into account when considering the need 
for national energy conservation, which is one of the factors that EPCA 
requires DOE to evaluate in determining whether a potential energy 
conservation standard is economically justified. In addition, Executive 
Order 13563, which was re-affirmed on January 21, 2021, stated that 
each agency must, among other things: ``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).'' 
For these reasons, DOE includes monetized emissions reductions in its 
evaluation of potential standard levels. As previously stated, however, 
DOE would reach the same conclusion presented in this proposed 
rulemaking in the absence of the social cost of greenhouse gases.
b. Social Cost of Methane and Nitrous Oxide
    The SC-CH4 and SC-N2O values used for this 
NOPR were based on the values developed for the February 2021 SC-GHG 
TSD. Table IV.38 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 derived values 
after 2050 using the approach described above for the SC-
CO2.

                                           Table IV.38--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%                                                                             3%
                                         ----------------------------------------------------------------                                                ----------------------------------------------
                                                                                               95th             5%              3%             2.5%                                            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
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

    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. DOE 
adjusted the values to 2021$ using the implicit price deflator for GDP 
from the Bureau of Economic Analysis. 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.
2. Monetization of Other Emissions Impacts
    For the NOPR, 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.\110\ 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, 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 RCWs using a method described in appendix 14B of the 
NOPR TSD.
---------------------------------------------------------------------------

    \110\ Estimating the Benefit per Ton of Reducing PM2.5 
Precursors from 21 Sectors. 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 
RCWs 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

[[Page 13584]]

commercial buildings, the sector called ``area sources'' would be a 
reasonable proxy for residential and commercial buildings.\111\ The EPA 
document provides high and low estimates for 2025 and 2030 at 3- and 7-
percent discount rates.\112\ DOE used the same linear interpolation and 
extrapolation as it did with the values for electricity generation.
---------------------------------------------------------------------------

    \111\ ``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.
    \112\ ``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 the changes in installed 
electrical capacity and generation projected to result for each 
considered TSL. The analysis is based on published output from the NEMS 
associated with AEO2022. 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 
AEO2022 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 
employees of manufacturers of the products subject to standards, their 
suppliers, and related service firms. 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.
    One method for assessing the possible effects on the demand for 
labor of such shifts in economic activity is to compare sector 
employment statistics developed by the Labor Department's Bureau of 
Labor Statistics (``BLS''). BLS regularly publishes its estimates of 
the number of jobs per million dollars of economic activity in 
different sectors of the economy, as well as the jobs created elsewhere 
in the economy by this same economic activity. Data from BLS indicate 
that expenditures in the utility sector generally create fewer jobs 
(both directly and indirectly) than expenditures in other sectors of 
the economy.\113\ 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.
---------------------------------------------------------------------------

    \113\ 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 apps.bea.gov/scb/pdf/regional/perinc/meth/rims2.pdf (Last accessed June 22, 2022).
---------------------------------------------------------------------------

    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 Technologies version 4 
(``ImSET'').\114\ 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.
---------------------------------------------------------------------------

    \114\ 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 (2027-2031), 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 RCWs. 
It addresses the TSLs examined by DOE, the projected impacts of each of 
these levels if adopted as energy conservation standards for RCWs, 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 by grouping individual efficiency levels for 
each class into TSLs. Use of TSLs allows DOE to identify and consider 
manufacturer cost interactions between the product 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 the analysis conducted for this NOPR, DOE analyzed the benefits 
and burdens of five TSLs for RCWs. DOE developed TSLs that combine 
efficiency

[[Page 13585]]

levels for each analyzed product class. 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 through Table V.3 present the TSLs and the corresponding 
efficiency levels that DOE has identified for potential amended energy 
conservation standards for RCWs. TSL 5 represents the max-tech energy 
and water efficiency for all product classes. TSL 4 represents the 
ENERGY STAR Most Efficient level for the front-loading product classes, 
the CEE Tier 1 level for the top-loading standard-size product class, 
and a gap fill level for the semi-automatic product class. TSL 3 
represents the current ENERGY STAR efficiency level for all product 
classes that are eligible for the program, and a gap fill level for the 
semi-automatic product class. TSL 2 represents the non-max-tech 
efficiency levels providing the highest LCC savings. TSL 1 represents 
EL 1 across all product classes.

                Table V.1--Trial Standard Levels for Semi-Automatic, Residential Clothes Washers
----------------------------------------------------------------------------------------------------------------
                                                                                  Semi-automatic
                                                                 -----------------------------------------------
                               TSL                                  Efficiency     EER (lb/kWh/    WER (lb/gal/
                                                                       level          cycle)          cycle)
----------------------------------------------------------------------------------------------------------------
1-4.............................................................               1            2.12            0.27
5...............................................................               2            2.51            0.36
----------------------------------------------------------------------------------------------------------------


                                      Table V.2--Trial Standard Levels for Top-Loading Residential Clothes Washers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          Top-loading, ultra-compact                                Top-loading, standard-size
                                     -------------------------------------------------------------------------------------------------------------------
                 TSL                                                       EER (lb/kWh/    WER (lb/gal/     Efficiency     EER (lb/kWh/    WER (lb/gal/
                                               Efficiency level               cycle)          cycle)           level          cycle)          cycle)
--------------------------------------------------------------------------------------------------------------------------------------------------------
1...................................  Baseline..........................            3.79            0.29               1            3.89            0.47
2...................................  Baseline..........................            3.79            0.29               1            3.89            0.47
3...................................  Baseline..........................            3.79            0.29               2            4.27            0.57
4...................................  Baseline..........................            3.79            0.29               3            4.78            0.63
5...................................  Baseline..........................            3.79            0.29               4            5.37            0.67
--------------------------------------------------------------------------------------------------------------------------------------------------------


                                     Table V.3--Trial Standard Levels for Front-Loading Residential Clothes Washers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      Front-loading, compact                       Front-loading, standard-size
                                                         -----------------------------------------------------------------------------------------------
                           TSL                              Efficiency     EER (lb/kWh/    WER (lb/gal/     Efficiency     EER (lb/kWh/    WER (lb/gal/
                                                               level          cycle)          cycle)           level          cycle)          cycle)
--------------------------------------------------------------------------------------------------------------------------------------------------------
1.......................................................               1            4.80            0.62               1            5.31            0.69
2.......................................................               1            4.80            0.62               2            5.52            0.77
3.......................................................               1            4.80            0.62               2            5.52            0.77
4.......................................................               2            5.02            0.71               3            5.73            0.77
5.......................................................               4            5.97            0.80               4            5.97            0.85
--------------------------------------------------------------------------------------------------------------------------------------------------------

    While not all efficiency levels were included in the TSLs, DOE 
considered all efficiency levels as part of its analysis.\115\
---------------------------------------------------------------------------

    \115\ Efficiency levels that were analyzed for this NOPR are 
discussed in section IV.C.1 of this document. Results by efficiency 
level are presented in chapters 8, 10, and 12 of the NOPR TSD.
---------------------------------------------------------------------------

B. Economic Justification and Energy Savings

1. Economic Impacts on Individual Consumers
    DOE analyzed the economic impacts on RCW consumers 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 and a discount rate. Chapter 8 of the NOPR TSD 
provides detailed information on the LCC and PBP analyses.
    Table V.4 through Table V.13 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.

[[Page 13586]]



                                  Table V.4--Average LCC and PBP Results for Semi-Automatic Residential Clothes Washers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                               Average costs (2021$)
                                                         ---------------------------------------------------------------- Simple payback      Average
             TSL                   Efficiency level                        First year's      Lifetime                         (years)        lifetime
                                                          Installed cost  operating cost  operating cost        LCC                           (years)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                              Baseline..................            $553            $136          $1,532          $2,085  ..............            13.7
1-4.........................  1.........................             561             107           1,195           1,756             0.3            13.7
5...........................  2.........................             568              93           1,044           1,612             0.4            13.7
--------------------------------------------------------------------------------------------------------------------------------------------------------
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 Semi-Automatic Residential Clothes
                                                     Washers
----------------------------------------------------------------------------------------------------------------
                                                                                   Life-cycle cost savings
                                                                           -------------------------------------
                                                                                                   Percent of
                          TSL                             Efficiency level     Average LCC       consumers that
                                                                            savings * (2021$)    experience net
                                                                                                      cost
----------------------------------------------------------------------------------------------------------------
1-4....................................................                  1                329                  0
5......................................................                  2                219                  0
----------------------------------------------------------------------------------------------------------------
* The savings represent the average LCC for affected consumers.


                            Table V.6--Average LCC and PBP Results for Top-Loading, Ultra-Compact Residential Clothes Washers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                           Average costs (2021$)
                                                   --------------------------------------------------------------------  Simple payback      Average
           TSL                 Efficiency level                        First year's       Lifetime                          (years)          lifetime
                                                     Installed cost   operating cost   operating cost        LCC                             (years)
--------------------------------------------------------------------------------------------------------------------------------------------------------
1-5......................  Baseline...............            $904              $85             $958           $1,862   ...............            13.7
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level.


 Table V.7--Average LCC Savings Relative to the No-New-Standards Case for Top-Loading, Ultra-Compact Residential
                                                 Clothes Washers
----------------------------------------------------------------------------------------------------------------
                                                                                  Life-cycle cost savings
                                                                         ---------------------------------------
                                                                                                  Percent of
                 TSL                            Efficiency level              Average LCC       consumers that
                                                                           savings * (2021$)    experience net
                                                                                                     cost
----------------------------------------------------------------------------------------------------------------
1-5..................................  Baseline.........................              $0.00                  0%
----------------------------------------------------------------------------------------------------------------
* The savings represent the average LCC for affected consumers.


                            Table V.8--Average LCC and PBP Results for Top-Loading, Standard-Size Residential Clothes Washers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                               Average costs (2021$)
                                                         ---------------------------------------------------------------- Simple payback      Average
             TSL                   Efficiency level                        First year's      Lifetime                         (years)        lifetime
                                                          Installed cost  operating cost  operating cost        LCC                           (years)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                              Baseline..................            $706            $183          $2,080          $2,786  ..............            13.7
1, 2........................  1.........................             795             164           1,853           2,649             4.6            13.7
3...........................  2.........................             881             157           1,779           2,660             6.8            13.7
4...........................  3.........................             891             152           1,717           2,608             5.9            13.7
5...........................  4.........................             896             149           1,682           2,578             5.5            13.7
--------------------------------------------------------------------------------------------------------------------------------------------------------
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.


[[Page 13587]]


        Table V.9--Average LCC and PBP Results for Top-Loading, Standard-Size Residential Clothes Washers
----------------------------------------------------------------------------------------------------------------
                                                                                   Life-cycle cost savings
                                                                           -------------------------------------
                                                                                                   Percent of
                          TSL                             Efficiency level     Average LCC       consumers that
                                                                            savings * (2021$)    experience net
                                                                                                      cost
----------------------------------------------------------------------------------------------------------------
1, 2...................................................                  1               $138                 14
3......................................................                  2                115                 28
4......................................................                  3                134                 25
5......................................................                  4                157                 23
----------------------------------------------------------------------------------------------------------------
* The savings represent the average LCC for affected consumers.


                             Table V.10--Average LCC and PBP Results for Front-Loading, Compact Residential Clothes Washers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                               Average costs (2021$)
                                                         ---------------------------------------------------------------- Simple payback      Average
             TSL                   Efficiency level                        First year's      Lifetime                         (years)        lifetime
                                                          Installed cost  operating cost  operating cost        LCC                           (years)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                              Baseline..................            $809            $100          $1,119          $1,929  ..............            13.7
1-3.........................  1.........................             861              93           1,046           1,907             0.0            13.7
4...........................  2.........................             909              89             992           1,901             9.1            13.7
5...........................  4.........................             944              81             901           1,845             7.1            13.7
--------------------------------------------------------------------------------------------------------------------------------------------------------
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 and PBP Results for Front-Loading, Compact Residential Clothes Washers
----------------------------------------------------------------------------------------------------------------
                                                                                   Life-cycle cost savings
                                                                           -------------------------------------
                                                                                                   Percent of
                          TSL                             Efficiency level     Average LCC       consumers that
                                                                            savings * (2021$)    experience net
                                                                                                      cost
----------------------------------------------------------------------------------------------------------------
1-3....................................................                  1               $0.0                  0
4......................................................                  2                  7                 24
5......................................................                  4                 56                 29
----------------------------------------------------------------------------------------------------------------
* The savings represent the average LCC for affected consumers.


                          Table V.12--Average LCC and PBP Results for Front-Loading, Standard-Size Residential Clothes Washers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                               Average costs (2021$)
                                                         ---------------------------------------------------------------- Simple payback      Average
             TSL                   Efficiency level                        First year's      Lifetime                         (years)        lifetime
                                                          Installed cost  operating cost  operating cost        LCC                           (years)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                              Baseline..................          $1,195            $146          $1,664          $2,859  ..............            13.7
1...........................  1.........................           1,213             140           1,589           2,802             2.8            13.7
2, 3........................  2.........................           1,226             133           1,513           2,740             2.4            13.7
4...........................  3.........................           1,244             131           1,488           2,732             3.2            13.7
5...........................  4.........................           1,265             126           1,424           2,689             3.4            13.7
--------------------------------------------------------------------------------------------------------------------------------------------------------
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 and PBP Results for Front-Loading, Standard-Size Residential Clothes Washers
----------------------------------------------------------------------------------------------------------------
                                                                                   Life-cycle cost savings
                                                                           -------------------------------------
                                                                                                   Percent of
                          TSL                             Efficiency level     Average  LCC      consumers that
                                                                               savings \*\      experience  net
                                                                                 (2021$)              cost
----------------------------------------------------------------------------------------------------------------
1......................................................                  1                $57                  0
2, 3...................................................                  2                 78                  0
4......................................................                  3                 19                 24

[[Page 13588]]

 
5......................................................                  4                 55                 18
----------------------------------------------------------------------------------------------------------------
* The savings represent the average LCC for affected consumers.

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. 
Table V.14 through Table V.18 compares the average LCC savings and PBP 
at each efficiency level for the consumer subgroups with similar 
metrics for the entire consumer sample for each RCW product class. The 
percent of low-income RCW consumers experiencing a net cost is smaller 
than the full LCC sample in all cases, largely due to the proportion of 
renter households. The percent of senior-only households experiencing a 
net cost is higher than the full LCC sample, largely due to the lower 
washer usage frequency. Chapter 11 of the NOPR TSD presents the 
complete LCC and PBP results for the subgroups.

     Table V.14--Comparison of LCC Savings and PBP for Consumer Subgroups and All Households; Semi-Automatic
                                           Residential Clothes Washers
----------------------------------------------------------------------------------------------------------------
                                                                    Low-income      Senior-only
                                                                    households      households    All households
----------------------------------------------------------------------------------------------------------------
                                           Average LCC Savings (2021$)
----------------------------------------------------------------------------------------------------------------
TSL 1-4.........................................................             389             265             329
TSL 5...........................................................             258             174             219
----------------------------------------------------------------------------------------------------------------
                                             Payback Period (years)
----------------------------------------------------------------------------------------------------------------
TSL 1-4.........................................................             0.1             0.4             0.3
TSL 5...........................................................             0.2             0.5             0.4
----------------------------------------------------------------------------------------------------------------
                                         Consumers with Net Benefit (%)
----------------------------------------------------------------------------------------------------------------
TSL 1-4.........................................................              18              21              21
TSL 5...........................................................              80              92              92
----------------------------------------------------------------------------------------------------------------
                                           Consumers with Net Cost (%)
----------------------------------------------------------------------------------------------------------------
TSL 1-4.........................................................               0               0               0
TSL 5...........................................................               0               0               0
----------------------------------------------------------------------------------------------------------------


  Table V.15--Comparison of LCC Savings and PBP for Consumer Subgroups and All Households; Top-Loading, Ultra-
                                       Compact Residential Clothes Washers
----------------------------------------------------------------------------------------------------------------
                                                                    Low-income      Senior-only
                                                                    households      households    All households
----------------------------------------------------------------------------------------------------------------
                                           Average LCC Savings (2021$)
----------------------------------------------------------------------------------------------------------------
TSL 1-5.........................................................              $0              $0              $0
----------------------------------------------------------------------------------------------------------------
                                             Payback Period (years)
----------------------------------------------------------------------------------------------------------------
TSL 1-5.........................................................  ..............  ..............  ..............
----------------------------------------------------------------------------------------------------------------
                                         Consumers with Net Benefit (%)
----------------------------------------------------------------------------------------------------------------
TSL 1-5.........................................................              0%              0%              0%
----------------------------------------------------------------------------------------------------------------
                                           Consumers with Net Cost (%)
----------------------------------------------------------------------------------------------------------------
TSL 1-5.........................................................              0%              0%              0%
----------------------------------------------------------------------------------------------------------------


[[Page 13589]]


 Table V.16--Comparison of LCC Savings and PBP for Consumer Subgroups and All Households; Top-Loading, Standard-
                                        Size Residential Clothes Washers
----------------------------------------------------------------------------------------------------------------
                                                                    Low-income      Senior-only
                                                                    households      households    All households
----------------------------------------------------------------------------------------------------------------
                                           Average LCC Savings (2021$)
----------------------------------------------------------------------------------------------------------------
TSL 1, 2........................................................            $175             $77            $138
TSL 3...........................................................             186              37             115
TSL 4...........................................................             189              62             134
TSL 5...........................................................             214              81             157
----------------------------------------------------------------------------------------------------------------
                                             Payback Period (years)
----------------------------------------------------------------------------------------------------------------
TSL 1, 2........................................................             2.7             6.3             4.6
TSL 3...........................................................             4.0             9.4             6.8
TSL 4...........................................................             3.5             8.1             5.9
TSL 5...........................................................             3.2             7.6             5.5
----------------------------------------------------------------------------------------------------------------
                                         Consumers with Net Benefit (%)
----------------------------------------------------------------------------------------------------------------
TSL 1, 2........................................................              47              39              46
TSL 3...........................................................              45              29              39
TSL 4...........................................................              72              59              69
TSL 5...........................................................              78              66              76
----------------------------------------------------------------------------------------------------------------
                                           Consumers with Net Cost (%)
----------------------------------------------------------------------------------------------------------------
TSL 1, 2........................................................               8              22              14
TSL 3...........................................................              15              38              28
TSL 4...........................................................              13              35              25
TSL 5...........................................................              13              33              23
----------------------------------------------------------------------------------------------------------------


 Table V.17--Comparison of LCC Savings and PBP for Consumer Subgroups and All Households; Front-Loading, Compact
                                           Residential Clothes Washers
----------------------------------------------------------------------------------------------------------------
                                                                    Low-income      Senior-only
                                                                    households      households    All households
----------------------------------------------------------------------------------------------------------------
                                           Average LCC Savings (2021$)
----------------------------------------------------------------------------------------------------------------
TSL 1-3.........................................................              $0              $0              $0
TSL 4...........................................................              27               3               7
TSL 5...........................................................              73              44              56
----------------------------------------------------------------------------------------------------------------
                                             Payback Period (years)
----------------------------------------------------------------------------------------------------------------
TSL 1-3.........................................................             0.0             0.0             0.0
TSL 4...........................................................             6.7             9.9             9.1
TSL 5...........................................................             5.2             7.8             7.1
----------------------------------------------------------------------------------------------------------------
                                         Consumers with Net Benefit (%)
----------------------------------------------------------------------------------------------------------------
TSL 1-3.........................................................               0               0               0
TSL 4...........................................................              21              14              15
TSL 5...........................................................              65              67              70
----------------------------------------------------------------------------------------------------------------
                                           Consumers with Net Cost (%)
----------------------------------------------------------------------------------------------------------------
TSL 1-3.........................................................               0               0               0
TSL 4...........................................................              10              25              24
TSL 5...........................................................              14              32              29
----------------------------------------------------------------------------------------------------------------


Table V.18--Comparison of LCC Savings and PBP for Consumer Subgroups and All Households; Front-Loading, Standard-
                                        Size Residential Clothes Washers
----------------------------------------------------------------------------------------------------------------
                                                                    Low-income      Senior-only
                                                                    households      households    All households
----------------------------------------------------------------------------------------------------------------
                                           Average LCC Savings (2021$)
----------------------------------------------------------------------------------------------------------------
TSL 1...........................................................             $56             $39             $57
TSL 2, 3........................................................              80              52              78
TSL 4...........................................................              25               8              19

[[Page 13590]]

 
TSL 5...........................................................              63              32              55
----------------------------------------------------------------------------------------------------------------
                                             Payback Period (years)
----------------------------------------------------------------------------------------------------------------
TSL 1...........................................................             2.0             3.8             2.8
TSL 2, 3........................................................             1.7             3.3             2.4
TSL 4...........................................................             2.3             4.3             3.2
TSL 5...........................................................             2.4             4.5             3.4
----------------------------------------------------------------------------------------------------------------
                                         Consumers with Net Benefit (%)
----------------------------------------------------------------------------------------------------------------
TSL 1...........................................................               1               2               2
TSL 2, 3........................................................               6               7               7
TSL 4...........................................................              29              22              28
TSL 5...........................................................              65              63              74
----------------------------------------------------------------------------------------------------------------
                                           Consumers with Net Cost (%)
----------------------------------------------------------------------------------------------------------------
TSL 1...........................................................               0               0               0
TSL 2, 3........................................................               1               1               0
TSL 4...........................................................              19              31              24
TSL 5...........................................................              20              29              18
----------------------------------------------------------------------------------------------------------------

c. Rebuttable Presumption Payback
    As discussed in section III.F.2 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. 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 RCWs. 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.
    Table V.19 presents the rebuttable-presumption payback periods for 
the considered TSLs for RCWs. 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.19--Rebuttable-Presumption Payback Periods
----------------------------------------------------------------------------------------------------------------
                                                               Trial standard level
          Product class          -------------------------------------------------------------------------------
                                         1               2               3               4               5
----------------------------------------------------------------------------------------------------------------
                                                                      (years)
                                 -------------------------------------------------------------------------------
Semi-Automatic..................             0.2             0.2             0.2             0.2             0.3
Top-Loading, Ultra-Compact *....            n.a.            n.a.            n.a.            n.a.            n.a.
Top-Loading, Standard-Size......             4.2             4.2             6.2             5.3             4.8
Front-Loading, Compact..........             6.5             6.5             6.5             7.5             6.0
Front-Loading, Standard-Size....             2.8             2.5             2.5             3.3             3.4
----------------------------------------------------------------------------------------------------------------
* The entry ``n.a.'' means not applicable because the evaluated standard is the baseline.

2. Economic Impacts on Manufacturers
    DOE performed an MIA to estimate the impact of amended energy 
conservation standards on manufacturers of RCWs. 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. See 
section V.B.1 of this document for a discussion of the potential 
impacts on consumers.
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. The 
following tables summarize the estimated financial impacts (represented 
by changes in INPV) of potential amended energy conservation standards 
on manufacturers of RCWs, as well as the conversion costs that DOE 
estimates manufacturers of RCWs 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. The preservation of gross margin 
percentage applies a ``gross

[[Page 13591]]

margin percentage'' of 18 percent for all product classes and all 
efficiency levels.\116\ This scenario assumes that a manufacturer's 
per-unit dollar profit would increase as MPCs increase in the standards 
cases and represents the upper-bound to industry profitability under 
potential amended energy conservation standards.
---------------------------------------------------------------------------

    \116\ The gross margin percentage of 18 percent is based on a 
manufacturer markup of 1.22.
---------------------------------------------------------------------------

    The preservation of operating profit scenario reflects 
manufacturers' concerns about their inability to maintain margins as 
MPCs increase to reach more-stringent efficiency levels. In this 
scenario, while manufacturers make the necessary investments required 
to convert their facilities to produce compliant products, operating 
profit does not change in absolute dollars and decreases as a 
percentage of revenue. 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.20--Manufacturer Impact Analysis Results for Residential Clothes Washers
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                      No-new-
                                       Unit          standards            TSL 1                     TSL 2                     TSL 3                     TSL 4                     TSL 5
                                                       case
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
INPV..........................  2021$ millions....     1,738.3  1,680.4 to 1,746.4......  1,636.5 to 1,702.9......  1,490.3 to 1,631.0......  1,208.1 to 1,376.7......  798.7 to 985.9
Change in INPV *..............  %.................  ..........  (3.3) to 0.5............  (5.9) to (2.0)..........  (14.3) to (6.2).........  (30.5) to (20.8)........  (54.1) to (43.3)
Free Cash Flow (2026) *.......  2021$ millions....       139.9  117.5...................  90.8....................  13.7....................  (150.0).................  (396.7)
Change in Free Cash Flow        %.................  ..........  (16.0)..................  (35.1)..................  (90.2)..................  (207.3).................  (383.7)
 (2026) *.
Conversion Costs..............  2021$ millions....  ..........  56.5....................  118.7...................  302.2...................  690.8...................  1,253.8
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
* Parentheses denote negative (-) values.

    The majority of the INPV impacts are associated with standard-size 
product classes because standard-size top-loading and front-loading 
RCWs comprise approximately 96 percent of the total RCW domestic 
shipments. More specifically, the majority of the INPV impacts are 
associated with top-loading clothes washers due to the high-volume of 
shipments, the high percentage of shipments at minimum efficiency, and 
the likely design paths required to meet more stringent standards. Top-
loading clothes washers account for approximately 76 percent of current 
standard-size RCW shipments. DOE's shipments analysis estimates 
approximately 69 percent of top-loading shipments are at the baseline 
efficiency level. Additionally, the engineering analysis, informed by 
conversations with manufacturers indicates that the likely design path 
to meet the efficiencies required at TSL 4 and TSL 5 would require 
notable capital investments. In particular, standard-size top-loading 
units with capacities of less than 4.7 ft\3\ would require significant 
redesign associated with increasing tub capacity to meet these higher 
efficiencies. In contrast, only 3 percent of current front-loading 
shipments are at the baseline efficiency level and DOE's engineering 
analysis suggests that increases in tub capacity would not be required 
for front-loading clothes washer models to reach max-tech. Thus, as DOE 
considers increasingly stringent TSLs, the standard-size top-loading 
product class tends to drive industry investments and negative INPV 
impacts. See chapter 5 of the NOPR TSD for a detailed discussion of 
design paths to reach higher efficiencies.
    At TSL 1, the standard represents the least stringent efficiencies 
(EL 1) for all product classes. The change in INPV is expected to range 
from -3.3 to 0.5 percent. At this level, free cash flow is estimated to 
decrease by 16.0 percent compared to the no-new-standards case value of 
$139.9 million in the year 2026, the year before the standards year. 
DOE's shipments analysis estimates approximately 48 percent of current 
shipments meet this level.
    At TSL 1, DOE expects most manufacturers would incur limited 
conversion costs to reach the efficiencies required. The conversion 
costs primarily stem from changes required for top-loading standard-
size clothes washers. DOE's shipments analysis estimates approximately 
31 percent of current standard-size top-loading clothes washers meet 
this level (EL 1). In contrast, nearly all the front-loading standard-
size clothes washers currently meet the efficiencies required at this 
level. Industry capital conversion costs include tooling updates and 
costs associated with transitioning models with porcelain wash baskets 
to stainless-steel wash baskets. Product conversion costs may be 
necessary for product development and testing. DOE expects industry to 
incur some re-flooring costs. DOE estimates capital conversion costs of 
$30.1 million and product conversion costs of $26.3

[[Page 13592]]

million. Conversion costs total $56.5 million.
    At TSL 1, the shipment-weighted average MPC for all RCWs is 
expected to increase by 6.9 percent relative to the no-new-standards 
case shipment-weighted average MPC for all RCWs in 2027. In the 
preservation of gross margin percentage scenario, the slight increase 
in cashflow slightly outweighs the $56.5 million in conversion costs, 
causing a minor positive change in INPV at TSL 1 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 $56.5 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 represents the non-max-tech efficiency 
levels providing the highest LCC savings for all product classes. The 
change in INPV is expected to range from -5.9 to -2.0 percent. At this 
level, free cash flow is estimated to decrease by 35.1 percent compared 
to the no-new-standards case value of $139.9 million in the year 2026, 
the year before the standards year. DOE's shipments analysis estimates 
approximately 47 percent of current shipments meet this level.
    For standard-size front-loading clothes washers, TSL 2 corresponds 
to EL 2. For the remaining product classes, TSL 2 corresponds to the 
same efficiencies required at TSL 1 (EL 1). The increase in conversion 
costs from the prior TSL are entirely due to the efficiency level 
requirements for standard-size front-loading clothes washers. DOE's 
shipments analysis estimates approximately 91 percent of current 
standard-size front-loading clothes washer shipments meet or exceed TSL 
2 efficiencies. Of the seven OEMs with standard-size front-loading 
clothes washer models, there is one OEM that does not currently offer a 
product that meets TSL 2 efficiencies. DOE assumed that this 
manufacturer would redesign and re-tool to meet TSL 2 in its estimate 
of conversion costs. That manufacturer accounts for the majority of the 
increase in conversion costs. DOE estimates capital conversion costs of 
$81.1 million and product conversion costs of $37.6 million. Conversion 
costs total $118.7 million.
    At TSL 2, the shipment-weighted average MPC for all RCWs is 
expected to increase by 6.9 percent relative to the no-new-standards 
case shipment-weighted average MPC for all RCWs in 2027. In the 
preservation of gross margin percentage scenario, the slight increase 
in cashflow is outweighed by the $118.7 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 
$118.7 million in conversion costs incurred by manufacturers cause a 
slightly negative change in INPV at TSL 2 under the preservation of 
operating profit scenario.
    At TSL 3, the standard represents the current ENERGY STAR 
efficiency level for all product classes that are eligible for the 
program, and a gap fill level for the semi-automatic product class. The 
change in INPV is expected to range from -14.3 to -6.2 percent. At this 
level, free cash flow is estimated to decrease by 90.2 percent compared 
to the no-new-standards case value of $139.9 million in the year 2026, 
the year before the standards year. DOE's shipments analysis estimates 
approximately 45 percent of current shipments meet this level.
    For standard-size top-loading clothes washers, TSL 3 corresponds to 
EL 2. For the remaining product classes, the efficiencies required at 
TSL 3 are the same as TSL 2. Approximately 29 percent of current 
standard-size top-loading clothes washer shipments meet the 
efficiencies required by TSL 3. However, most manufacturers with 
standard-size top-loading models offer products at or above the 
efficiencies required at this level. Of the nine OEMs with standard-
size top-loading products, six OEMs offer models that meet the 
efficiencies required.
    To meet TSL 3, DOE expects manufacturers would incorporate wash 
plate designs, direct drive motors, and hardware features enabling spin 
speed increases into standard-size top-loading RCWs. Beyond these 
design options, some manufacturers may need to increase the tub 
capacities of certain standard-size top-loading clothes washers (i.e., 
models with capacities of less than 4.4 ft\3\). Increasing clothes 
washer capacity could require a new cabinet, tub, and drum designs, 
which would necessitate costly investments in manufacturing equipment 
and tooling. Product conversion costs may be necessary for designing, 
prototyping, and testing new or updated platforms. Additionally, DOE 
expects industry to incur more re-flooring costs compared to prior TSLs 
as more display units would need to be replaced. The increase in 
conversion costs at TSL 3 are entirely due to the increased stringency 
for standard-size top-loading clothes washers. DOE estimates capital 
conversion costs of $216.4 million and product conversion of costs of 
$85.7 million. Conversion costs total $302.2 million.
    At TSL 3, the shipment-weighted average MPC for all RCWs is 
expected to increase by 14.1 percent relative to the no-new-standards 
case shipment-weighted average MPC for all RCWs in 2027. In the 
preservation of gross margin percentage scenario, the increase in 
cashflow is outweighed by the $302.2 million in conversion costs, 
causing a slightly 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 
$302.2 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 represents the ENERGY STAR Most Efficient 
level for the front-loading product classes, the CEE Tier 1 level for 
the top-loading standard-size product class, and a gap fill level for 
the semi-automatic product class. The change in INPV is expected to 
range from -30.5 to -20.8 percent. At this level, free cash flow is 
estimated to decrease by 207.3 percent compared to the no-new-standards 
case value of $139.9 million in the year 2026, the year before the 
standards year. DOE's shipments analysis estimates approximately 14 
percent of current shipments meet this level.
    For standard-size top-loading and standard-size front-loading 
clothes washers, TSL 4 corresponds to EL 3. For compact-size front-
loading clothes washers, TSL 4 corresponds to EL 2. For semi-automatic 
clothes washers, TSL 4 corresponds to the same efficiency level as TSL 
3 (EL 1). At this level, the increase in conversion costs is driven by 
the standard-size top-loading clothes washers product class. Currently, 
approximately 2 percent of standard-size top-loading shipments meet TSL 
4 efficiencies. Of the nine OEMs with top-loading standard-size 
products, only two offer models that meet the efficiencies required at 
TSL 4. The remaining seven OEMs would need to redesign all their 
existing standard-size top-loading platforms to meet this level.
    To meet TSL 4, top-loading clothes washer designs would likely need 
to incorporate hardware features to enable faster spin speeds. These 
hardware updates may include reinforced wash baskets, more robust 
suspension and

[[Page 13593]]

balancing system, and more advanced sensors. An increasing portion of 
top-loading standard-size clothes washers (i.e., those models with 
capacities less than 4.7 ft\3\) may need an increase in tub capacity. 
Increasing clothes washer capacity could require new cabinet, tub, and 
drum designs. The changes would necessitate investments in new 
equipment and tooling. DOE expects industry to incur more re-flooring 
costs compared to prior TSLs as more display units would need to be 
replaced. DOE estimates capital conversion costs of $507.9 million and 
product conversion of costs of $200.8 million. Conversion costs total 
$708.6 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 TSL 4, the shipment-weighted average MPC for all RCWs is 
expected to increase by 15.6 percent relative to the no-new-standards 
case shipment-weighted average MPC for all RCWs in 2027. In the 
preservation of gross margin percentage scenario, the increase in 
cashflow is outweighed by the $690.8 million in conversion costs, 
causing a notable 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 $690.8 million in 
conversion costs incurred by manufacturers cause a significant negative 
change in INPV at TSL 4 under the preservation of operating profit 
scenario.
    At TSL 5, the standard represents the max-tech energy and water 
efficiencies for all product classes. The change in INPV is expected to 
range from -54.1 to -43.3 percent. At this level, free cash flow is 
estimated to decrease by 383.7 percent compared to the no-new-standards 
case value of $139.9 million in the year 2026, the year before the 
standards year. DOE's shipments analysis estimates approximately 3 
percent of current shipments meet this level.
    As previously discussed, the max-tech efficiencies required for 
standard-size clothes washers drive the increase in conversion costs 
from the prior TSLs. Currently, less than 1 percent of standard-size 
top-loading clothes washer shipments and approximately 9 percent of 
standard-size front-loading clothes washer shipments meet max-tech 
levels. Out of the nine standard-size top-loading OEMs, only one offers 
models that meet the efficiencies required by TSL 5. Out of the seven 
standard-size front-loading OEMs, only two offer models that meet the 
efficiencies required by TSL 5. Max-tech would require most 
manufacturers to significantly redesign their clothes washer platforms. 
DOE expects most standard-size clothes washer manufacturers would need 
to further increase spin speeds as compared to prior TSLs. An 
increasing portion of top-loading standard-size clothes washers (i.e., 
models with capacities of less than 5.0 ft\3\) may need to increase tub 
capacity to achieve the RMCs required at this level. In interviews, two 
manufacturers stated that max-tech levels would require a total 
renovation of existing production facilities. Some manufacturers 
further stated that their product portfolio would be limited due to the 
lack of differentiation possible under a max-tech standard, which would 
potentially limit their ability to serve certain consumer segments and 
hurt profitability. DOE expects industry would incur approximately the 
same re-flooring costs as TSL 4 since few models exist at the higher 
levels. At TSL 5, reaching max-tech efficiency levels is a billion-
dollar investment for industry. DOE estimates capital conversion costs 
of $1,013.3 million and product conversion of costs of $240.5 million. 
Conversion costs total $1,253.8 million.
    At TSL 5, 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 TSL 5, the shipment-weighted average MPC for all RCWs is 
expected to increase by 17.1 percent relative to the no-new-standards 
case shipment-weighted average MPC for all RCWs in 2027. In the 
preservation of gross margin percentage scenario, the increase in 
cashflow is outweighed by the $1,253.8 million in conversion costs, 
causing a significant 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 reduction in the manufacturer markup and the 
$1,253.8 million in conversion costs incurred by manufacturers cause a 
significant negative change in INPV at TSL 5 under the preservation of 
operating profit scenario.
    DOE seeks comments, information, and data on the capital conversion 
costs and product conversion costs estimated for each TSL.
b. Direct Impacts on Employment
    To quantitatively assess the potential impacts of amended energy 
conservation standards on direct employment in the RCW 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 2020 ASM,\117\ BLS employee 
compensation data,\118\ results of the engineering analysis, and 
manufacturer interviews.
---------------------------------------------------------------------------

    \117\ U.S. Census Bureau, Annual Survey of Manufactures. 
``Summary Statistics for Industry Groups and Industries in the U.S. 
(2020).'' Available at: www.census.gov/data/tables/time-series/econ/asm/2018-2020-asm.html (Last accessed July 15, 2022).
    \118\ U.S. Bureau of Labor Statistics. ``Employer Costs for 
Employee Compensation.'' June 16, 2022. Available at: www.bls.gov/news.release/pdf/ecec.pdf (Last accessed July 27, 2022).
---------------------------------------------------------------------------

    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 92 percent of RCWs are produced 
domestically.

[[Page 13594]]

    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 products covered by 
this proposed rulemaking.
    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 previously, 
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-new-standards case and standards cases.
    Using the GRIM, DOE estimates in the absence of new energy 
conservation standards there would be 9,222 domestic workers for RCWs 
in 2027. Table V.21 shows the range of the impacts of energy 
conservation standards on U.S. manufacturing employment in the RCW 
industry. The following discussion provides a qualitative evaluation of 
the range of potential impacts presented in Table V.21.

                                               Table V.21--Domestic Direct Employment Impacts for Residential Clothes Washer Manufacturers in 2027
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                        No-new-
                                    standards case             TSL 1                        TSL 2                        TSL 3                       TSL 4                       TSL 5
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Direct Employment (Production                9,222  10,511.....................  10,504.....................  11,710....................  11,973....................  11,939
 Workers + Non-Production Workers).
Potential Changes in Direct         ..............  (8,121) to 1,289...........  (8,121) to 1,282...........  (8,121) to 2,488..........  (8,121) to 2,751..........  (8,121) to 2,717
 Employment Workers *.
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
* DOE presents a range of potential direct employment impacts. Numbers in parentheses indicate negative numbers.

    The direct employment impacts shown in Table V.21 represent the 
potential domestic employment changes that could result following the 
compliance date for the RCWs covered in this proposal. The upper bound 
estimate corresponds to an increase in the number of domestic workers 
that results from amended energy conservation standards if 
manufacturers continue to produce the same scope of covered products 
within the United States after compliance takes effect. To establish a 
conservative lower bound, DOE assumes all manufacturers would shift 
production to foreign countries. At lower TSLs, DOE believes the 
likelihood of changes in production location due to amended standards 
are low due to the relatively minor production line updates required. 
However, as amended standards increase in stringency and both the 
complexity and cost of production facility updates increases, 
manufacturers are more likely to revisit their production location 
decisions. At max-tech, manufacturers representing a large portion of 
the market noted concerns about the level of investment, about the 
potential need to relocate production lines in order to remain 
competitive, and about the conversion period of 3 years being 
insufficient to make the necessary manufacturing line updates.
    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, meeting the 
efficiencies required for each TSL would require varying levels of 
resources and investment. A standard level requiring notably faster 
spin speeds, namely TSL 4 and TSL 5, would necessitate product redesign 
to account for the increased spin speeds as well as the noise, 
vibration, and fabric care concerns related to the spin speeds required 
to meet these higher TSLs. These updates may include designing and 
manufacturing reinforced wash baskets, instituting a more robust 
suspension and balancing system, increasing the number of sensors, and 
incorporating more advanced sensors. For standard-size top-loading 
clothes washers, manufacturers would also need to increase tub capacity 
of smaller models to meet the efficiencies required at higher TSLs. 
Many manufacturers would need to invest in new tooling and equipment to 
either produce entirely new wash basket lines or ramp up production of 
their existing larger capacity wash baskets. Based on a review of CCD 
model listings, DOE's engineering analysis indicates that tub capacity 
would need to increase to 4.4 ft\3\ at TSL 3, 4.7 ft\3\ at TSL 4, and 
5.0 ft\3\ at TSL 5 for the top-loading standard-size product 
class.\119\ In interviews, some manufacturers expressed concerns--
particularly at max-tech--that the 3-year period between the 
announcement of the final rule and the compliance date of the amended 
energy conservation standard might be insufficient to update production 
facilities and design, test, and manufacture the necessary number of 
products to meet demand.
---------------------------------------------------------------------------

    \119\ Based on the increase in cost associated with implementing 
a larger capacity tub, DOE expects that if a higher efficiency level 
were possible to achieve without an increase in capacity, such 
products would be available on the market.
---------------------------------------------------------------------------

    For the remaining TSLs (i.e., TSL 1, TSL 2, and TSL 3) most 
manufacturers could likely maintain manufacturing capacity levels and 
continue to meet market demand under amended energy conservation 
standards.
    DOE seeks comment on whether manufacturers expect manufacturing 
capacity constraints due to production facility updates would limit 
product availability to consumers in the timeframe of the amended 
standard compliance date (2027).
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

[[Page 13595]]

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 proposed 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. In summary, the Small Business Administration (``SBA'') 
defines a ``small business'' as having 1,500 employees or less for 
NAICS 335220, ``Major Household Appliance Manufacturing.'' \120\ Based 
on this classification, DOE identified one domestic OEM that qualifies 
as a small business. For a discussion of the impacts on the small 
business manufacturer subgroup, see the Regulatory Flexibility Analysis 
in section VI.B of this document and chapter 12 of the NOPR TSD.
---------------------------------------------------------------------------

    \120\ U.S. Small Business Administration. ``Table of Small 
Business Size Standards.'' (Effective July 14, 2022). Available at: 
www.sba.gov/document/support-table-size-standards (Last accessed 
August 16, 2022).
---------------------------------------------------------------------------

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 RCW 
manufacturers that take effect approximately three years before or 
after the 2027 compliance date.
    In response to the September 2021 Preliminary Analysis, 
stakeholders commented on the cumulative regulatory burden analysis. 
See section IV.J.3.c for a summary of stakeholder comments and DOE's 
initial responses.

  Table V.22--Compliance Dates and Expected Conversion Expenses of Federal Energy Conservation Standards Affecting Residential Clothes Washer Original
                                                                 Equipment Manufacturers
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                             Industry
                                                                                  Number of OEMs                           Industry         conversion
              Federal energy conservation standard                Number of OEMs   affected from   Approx. standards   conversion costs   costs/ product
                                                                         *         today's rule          year            (millions $)       revenue ***
                                                                                        **                                                      (%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Portable Air Conditioners, 85 FR 1378 (January 10, 2020)........              11               2                2025      $320.9 (2015$)             6.7
Room Air Conditioners [dagger], 87 FR 20608 (April 7, 2022).....               8               4                2026       $22.8 (2020$)             0.5
Consumer Furnaces [dagger], 87 FR 40590 (July 7, 2022)..........              15               1                2029      $150.6 (2020$)             1.4
Commercial Water Heating Equipment [dagger], 87 FR 30610 (May                 14               1                2026       $34.6 (2020$)             4.7
 19, 2022)......................................................
Consumer Clothes Dryers [dagger], 87 FR 51734 (August 23, 2022).              15              12                2027      $149.7 (2020$)             1.8
Microwave Ovens [dagger], 87 FR 52282 (August 24, 2022).........              18               9                2026       $46.1 (2021$)             0.7
Consumer Conventional Cooking Products [dagger], 88 FR 6818                   34               9                2027      $183.4 (2021$)             1.2
 (February 1, 2023).............................................
Consumer Refrigerators, Refrigerator-Freezes, and Freezers                    49              12                2027    $1,323.6 (2021$)             3.8
 [dagger][Dagger]...............................................
--------------------------------------------------------------------------------------------------------------------------------------------------------
* 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 RCWs 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] These rulemakings are in the proposed rule stage and all values are subject to change until finalized.
[Dagger] At the time of issuance of this RCW proposed rule, this rulemaking has been issued and is pending publication in the Federal Register. Once
  published, the consumer refrigerators, refrigerator-freezers, and freezers proposed rule will be available at: www.regulations.gov/docket/EERE-2017-BT-STD-0003.

    DOE requests information regarding the impact of cumulative 
regulatory burden on manufacturers of RCWs associated with multiple DOE 
standards or product-specific regulatory actions of other Federal 
agencies.
3. National Impact Analysis
    This section presents DOE's estimates of the national energy and 
water savings

[[Page 13596]]

and the NPV of consumer benefits that would result from each of the 
TSLs considered as potential amended standards.
a. Significance of Energy and Water Savings
    To estimate the energy and water savings attributable to potential 
amended standards for RCWs, DOE compared their energy and water 
consumption under the no-new-standards case to their anticipated energy 
and water 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.23 and Table V.24 present DOE's projections of the 
national energy and water savings for each TSL considered for RCWs, 
respectively. The savings were calculated using the approach described 
in section IV.H of this document.

      Table V.23--Cumulative National Energy Savings for Residential Clothes Washers; 30 Years of Shipments
                                                   [2027-2056]
----------------------------------------------------------------------------------------------------------------
                                                               Trial standard level
                                 -------------------------------------------------------------------------------
                                         1               2               3               4               5
----------------------------------------------------------------------------------------------------------------
                                                                      (quads)
                                 -------------------------------------------------------------------------------
Primary energy..................            0.59            0.59            0.70            1.39            2.15
FFC energy......................            0.61            0.62            0.74            1.45            2.27
----------------------------------------------------------------------------------------------------------------


      Table V.24--Cumulative National Water Savings for Residential Clothes Washers; 30 Years of Shipments
                                                   [2027-2056]
----------------------------------------------------------------------------------------------------------------
                                                               Trial standard level
                                 -------------------------------------------------------------------------------
                                         1               2               3               4               5
----------------------------------------------------------------------------------------------------------------
                                                                (trillion gallons)
                                 -------------------------------------------------------------------------------
Water Savings...................            1.26            1.27            2.07            2.53            2.94
----------------------------------------------------------------------------------------------------------------

    OMB Circular A-4 \121\ 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 proposed 
rulemaking, DOE undertook a sensitivity analysis 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.\122\ The review timeframe established in EPCA 
is generally not synchronized with the product lifetime, product 
manufacturing cycles, or other factors specific to RCWs. Thus, such 
results are presented for informational purposes only and are not 
indicative of any change in DOE's analytical methodology. The NES and 
NWS sensitivity analysis results based on a 9-year analytical period 
are presented in Table V.25 and Table V.26. The impacts are counted 
over the lifetime of RCWs purchased in 2027-2035.
---------------------------------------------------------------------------

    \121\ U.S. Office of Management and Budget. Circular A-4: 
Regulatory Analysis. September 17, 2003. 
obamawhitehouse.archives.gov/omb/circulars_a004_a-4/ (Last accessed 
June 12, 2022).
    \122\ 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.25--Cumulative National Energy Savings for Residential Clothes Washers; 9 Years of Shipments
                                                   [2027-2035]
----------------------------------------------------------------------------------------------------------------
                                                               Trial standard level
                                 -------------------------------------------------------------------------------
                                         1               2               3               4               5
----------------------------------------------------------------------------------------------------------------
                                                                      (quads)
                                 -------------------------------------------------------------------------------
Primary energy..................            0.24            0.25            0.29            0.50            0.72
FFC energy......................            0.26            0.26            0.31            0.53            0.75
----------------------------------------------------------------------------------------------------------------


[[Page 13597]]


       Table V.26--Cumulative National Water Savings for Residential Clothes Washers; 9 Years of Shipments
                                                   [2027-2035]
----------------------------------------------------------------------------------------------------------------
                                                               Trial standard level
                                 -------------------------------------------------------------------------------
                                         1               2               3               4               5
----------------------------------------------------------------------------------------------------------------
                                                                (trillion gallons)
                                 -------------------------------------------------------------------------------
Water Savings...................            0.51            0.52            0.79            0.93            1.04
----------------------------------------------------------------------------------------------------------------

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 RCWs. In 
accordance with OMB's guidelines on regulatory analysis,\123\ DOE 
calculated NPV using both a 7-percent and a 3-percent real discount 
rate. Table V.27 shows the consumer NPV results with impacts counted 
over the lifetime of products purchased in 2027-2056.
---------------------------------------------------------------------------

    \123\ 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 
June 12, 2022).

   Table V.27--Cumulative Net Present Value of Consumer Benefits for Residential Clothes Washers; 30 Years of
                                                    Shipments
                                                   [2027-2056]
----------------------------------------------------------------------------------------------------------------
                                                               Trial standard level
          Discount rate          -------------------------------------------------------------------------------
                                         1               2               3               4               5
----------------------------------------------------------------------------------------------------------------
                                                                  (billion 2021$)
                                 -------------------------------------------------------------------------------
3 percent.......................            8.39            8.50            8.13           14.52           20.77
7 percent.......................            3.36            3.41            2.48            5.14            7.68
----------------------------------------------------------------------------------------------------------------

    The NPV results based on the aforementioned 9-year analytical 
period are presented in Table V.28. 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.28--Cumulative Net Present Value of Consumer Benefits for Residential Clothes Washers; 9 Years of
                                                    Shipments
                                                   [2027-2035]
----------------------------------------------------------------------------------------------------------------
                                                               Trial standard level
          Discount rate          -------------------------------------------------------------------------------
                                         1               2               3               4               5
----------------------------------------------------------------------------------------------------------------
                                                                  (billion 2021$)
                                 -------------------------------------------------------------------------------
3 percent.......................            3.90            3.97            3.68            6.13            8.35
7 percent.......................            1.93            1.96            1.39            2.74            3.95
----------------------------------------------------------------------------------------------------------------

    The previous results reflect the use of a default trend to estimate 
the change in price for RCWs 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 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 
RCWs would reduce energy and water 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 
(2027-2031), 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,

[[Page 13598]]

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 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))
a. Performance Characteristics
    EPCA authorizes DOE to design test procedures that measure energy 
efficiency, energy use, water use (in the case of showerheads, faucets, 
water closets and urinals), or estimated annual operating cost of a 
covered product during a representative average use cycle or period of 
use. (42 U.S.C. 6293(b)(3)) Currently, DOE's test procedure addresses 
the energy and water efficiency of clothes washers, and DOE's clothes 
washer test procedures do not prescribe a method for testing clothes 
washer cleaning performance or other consumer-relevant attributes of 
performance.
    Representative average use of a clothes washer reflects, in part, a 
consumer using the clothes washer to achieve an acceptable level of 
cleaning performance. DOE recognizes that in general, a consumer-
acceptable level of cleaning performance can be easier to achieve 
through the use of higher amounts of energy and water use during the 
clothes washer cycle. Conversely, maintaining acceptable cleaning 
performance can be more difficult as energy and water levels are 
reduced. Improving one aspect of clothes washer performance, such as 
reducing energy and/or water use as a result of energy conservation 
standards, may require manufacturers to make a trade-off with one or 
more other aspects of performance, such as cleaning performance, 
depending on which performance characteristics are prioritized by the 
manufacturer. DOE expects, however, that consumers maintain the same 
expectations of cleaning performance regardless of the efficiency of 
the clothes washer. As the clothes washer market continuously evolves 
to higher levels of efficiency--either as a result of mandatory minimum 
standards or in response to voluntary programs such as ENERGY STAR--it 
becomes increasingly more important that DOE ensures that its test 
procedure continues to reflect representative use. As such, the normal 
cycle that is used to test the clothes washer for energy and water 
performance must be one that provides a consumer-acceptable level of 
cleaning performance, even as efficiency increases.
    Whirlpool commented that amended standards would result in an 
increase in purchase price and perceptible differences in product 
performance including cycle time, vibration and noise, fabric care, 
cleaning and rinse performance, and detergent effectiveness. 
(Whirlpool, No. 39 at pp. 8-9) Whirlpool commented that it does not 
recommend that DOE develop a performance requirement, like that under 
consideration for dishwashers currently, but rather referenced the EPCA 
requirement that DOE consider performance and the impacts to consumer 
utility as one of the seven statutory factors for considering whether a 
standard is justified. (Id.) Whirlpool recommended that DOE conclude 
that amended standards are not justified due to the potential to lessen 
utility and performance of clothes washers, particularly for top-
loading standard-size clothes washers. (Id.)
    Regarding cycle time specifically, Whirlpool commented that amended 
standards could require an increase in cycle time. (Whirlpool, No. 39 
at p. 9) Specifically, Whirlpool explained that the wash phase of the 
cycle may need to be longer in order to compensate for decreased water 
temperatures and reduced load motion due to increased pauses to allow 
for motor cooling; the spin phase would need to be longer to reduce 
RMC; and that as spin speeds increase, cycle time could be increased 
due to a greater risk of out-of-balance conditions, which require more 
sensing and re-balancing to address. Whirlpool also commented that 
appendix J would require spinning at maximum speed for both small and 
large load sizes and noted that smaller loads do not extract moisture 
as well as larger loads, and therefore would require even more spin 
time. (Id.) Whirlpool also asserted that because increased spin time 
may lead to greater electrical energy use by the clothes washers, the 
annual energy consumption reported on the EnergyGuide label may show an 
increase in energy use for new higher-efficiency models, which would be 
counterintuitive for consumers. (Id.)
    Regarding vibration and noise specifically, Whirlpool commented 
that it would expect higher overall noise and vibration levels as a 
result of increased spin speeds and spin times. (Whirlpool, No. 39 at 
p. 10) In addition, the drivetrain may produce louder sounds due to the 
additional motor torque required to move a load with lower water 
levels. (Id.) Whirlpool also commented that the higher risk of out-of-
balance conditions from faster spin speeds may also contribute to 
higher noise and vibration levels. (Id.) Whirlpool recommended that DOE 
account for any additional product cost required to keep sound and 
vibration levels where they are currently to prevent consumer 
dissatisfaction at higher efficiency levels. (Id.)
    Regarding fabric care specifically, Whirlpool commented if wash 
time is lengthened in order to compensate for reduced water 
temperatures, the additional agitation on the clothes may lead to 
increased fabric wear and damage. (Whirlpool, No. 39 at pp. 10-11) 
Whirlpool also commented that faster spinning would increase the degree 
of wrinkling in a load and that clothes may become more tangled. (Id.)
    Regarding cleaning and rinsing performance specifically, Whirlpool 
commented that amended standards could result in biofilm accumulations 
on internal wash unit surfaces, white residues, difficulty removing 
detergent and particulates, redeposition, yellowing of clothes, and 
reduced stain removal, especially for oily or fatty soils. (Whirlpool, 
No. 39 at p. 11) Whirlpool added that some of these issues (e.g., 
reduced stain removal) may be immediately apparent to consumers, 
whereas others (e.g., biofilm accumulation) may become noticeable over 
time. (Id.) Whirlpool commented that a correlation exists between lower 
water temperatures and degraded cleaning performance. (Id.) Whirlpool 
added that oily or fatty solids are soluble around 85 [deg]F, that 
detergents can do only some of the work removing oily or fatty soils at 
temperatures below 85 [deg]F, and that natural skin oils will be harder 
to remove under lower temperatures. (Id.) Whirlpool also commented that 
rinse performance could suffer as a result of the need to make trade-
offs in allocating the available water between the wash and rinse 
phases. Whirlpool commented that reduced water during the rinse phase 
makes it harder to effectively remove detergent and particulates from 
the wash load and increases re-deposition. (Id.)
    Whirlpool commented that overall load motion, the degree to which 
the load moves in the wash bath and the amount of free water visible to 
the consumer, may be sacrificed as clothes washers move to faster spin 
and lower torque powertrains. (Whirlpool, No. 39 at p. 12) Whirlpool 
further commented that, according to its initial testing, a reduction 
in load motion of over 50 percent could result from the new

[[Page 13599]]

powertrains needed for amended standards due to the lower available 
torque from the motor and reduced water levels needed to meet more 
stringent water efficiency requirements. (Id.)
    Whirlpool commented in summary that cleaning in a clothes washer is 
a holistic experience that encompasses a consumer's expectation of 
product appearance, cleanliness of the clothes washer itself, water 
level, water temperatures, load motion, cycle time, and cleaning 
performance, including stain and soil removal, particulate removal, 
odor removal, and detergent rinsing. (Whirlpool, No. 39 at p. 12) 
Whirlpool added that if consumer expectations are not met at any point, 
they will likely have a negative perception of product performance and 
often voice complaints about it in the form of a negative review or 
call to the manufacturer. (Id.)
    AHAM commented that DOE's proposed changes to the test procedure 
alone, and when coupled with amended energy conservation standards, are 
likely to drive product performance impacts. (AHAM, No. 40 at p. 9) 
AHAM further commented that increasing spin speed and spin time could 
cause increased vibration and noise, negatively impact fabric care due 
to tangling and wrinkling, and increase cycle time. (AHAM, No. 40 at 
pp. 9-10)
    AHAM recommended that instead of adding a performance minimum to 
the test procedure, DOE should avoid changes that could impact clothes 
washer performance, and account for the potential impact of these 
changes in DOE's amended standards analysis, as required by EPCA. 
(AHAM, No. 40 at p. 10) AHAM also noted that conducting a performance 
test may not capture all the potential impacts that standards may have 
on clothes washer performance. (Id.) AHAM recommended that DOE further 
investigate these potential impacts during manufacturer interviews. 
(Id.)
    AHAM commented that efficiency standards that require increased 
cycle times beyond an acceptable length would negatively impact 
consumers and could result in cycle times that are not synchronized 
with clothes dryer cycle times. (AHAM, No. 40 at p. 10) AHAM 
recommended against introducing a maximum cycle length requirement; 
instead, AHAM recommended that any potential impact of cycle time 
should be avoided and accounted for in DOE's amended standards, as 
required by EPCA. (Id.)
    In addition to considering the comments summarized in this section, 
DOE also discussed performance characteristics in detail as part of its 
confidential interviews with manufacturers. DOE has considered 
potential impacts to the various attributes of product performance as 
part of its consideration of amended standards, as discussed further in 
section V.C.1 of this document.
    DOE is aware of high-efficiency clothes washers that achieve equal 
or better cleaning performance than lower-efficiency clothes washers in 
third-party performance reviews. For example, DOE has consulted 
performance ratings published by Consumer Reports,\124\ which DOE 
recognizes is one popular resource for consumers seeking independent 
reviews of consumer products. According to information provided on 
their website, the test method used by Consumer Reports appears to be 
similar in nature to AHAM's cleaning performance test procedure, but 
inconsistent with the test conditions prescribed by DOE's appendix J 
test procedure; \125\ nevertheless, its test results provide an 
objective measure of the performance capabilities for products 
currently on the market.
---------------------------------------------------------------------------

    \124\ Consumer Reports ratings of clothes washers available at 
www.consumerreports.org/appliances/washing-machines/. Last accessed 
September 23, 2022.
    \125\ The Consumer Reports describes its washing performance 
test as reflecting the degree of color change to swatches of fabric 
that were included in an 8-pound test load of mixed cotton items 
using the unit's ``most aggressive'' normal cycle.
---------------------------------------------------------------------------

    For top-loading standard-size RCWs, Consumer Reports ratings 
indicate that models rated at or above TSL 4 achieve equal or better 
cleaning performance than models with lower efficiency ratings. 
Specifically, among 4 tested top-loading standard-size models with an 
IMEF/IWF rating \126\ at or above TSL 4, all of them receive a relative 
``washing performance'' rating of 5 out of 5. Among 70 tested top-
loading standard-size models with an IMEF/IWF rating below TSL 4, 11 
models (16 percent) receive a relative rating of 5 out of 5, and 26 
models (37 percent) receive a relative rating of 4 out of 5--for a 
total of only 53 percent of units receiving a score of 4 or 5 out of 5. 
These ratings suggest that top-loading standard-size RCWs with 
efficiency ratings at or above TSL 4 can achieve equal or better 
overall cleaning performance scores than models with lower efficiency 
ratings.
---------------------------------------------------------------------------

    \126\ Although the efficiency levels are defined based on EER 
and WER, manufacturer ratings use IMEF and IWF.
---------------------------------------------------------------------------

    For front-loading standard-size RCWs, Consumer Reports ratings 
indicate no significant differences between models rated at or above 
TSL 4 and models with lower efficiency ratings. Specifically, among 27 
tested front-loading standard-size models with an IMEF/IWF rating at or 
above TSL 4, 20 models (74 percent) receive a relative rating of 5 out 
of 5, and 6 models (22 percent) receive a relative rating of 4 out of 
5--for a total of only 96 percent of units receiving a score of 4 or 5 
out of 5. Among 20 tested front-loading standard-size models with an 
IMEF/IWF rating below TSL 4, 18 models (90 percent) receive a relative 
rating of 5 out of 5, and 2 models (10 percent) receive a relative 
rating of 4 out of 5--for a total of 100 percent of units receiving a 
score of 4 or 5 out of 5. These ratings suggest that front-loading 
standard-size RCWs with efficiency ratings at or above TSL 4 can 
achieve roughly equivalent overall cleaning performance scores compared 
to models with lower efficiency ratings.
    DOE seeks comment on whether the Consumer Reports test produces 
cleaning performance results that are representative of an average use 
cycle as measured by the DOE test procedure. DOE also seeks comment on 
how relative cleaning performance results would vary if tested under 
test conditions consistent with the DOE appendix J test procedure.
    In addition to considering the Consumer Reports ratings, DOE 
conducted performance testing on a representative sample of top-loading 
standard-size and front-loading standard-size units, which collectively 
represent around 98 percent of RCW shipments. The detailed results of 
DOE's testing are provided in the performance characteristics test 
report, which is available in the docket for this rulemaking. In 
particular, DOE evaluated wash temperatures, stain removal, mechanical 
action (i.e., ``wear and tear''), and cycle duration across the range 
of efficiency levels considered in the analysis. Specifically, DOE 
evaluated wash temperatures and cycle time based on test data performed 
according to DOE's new appendix J test procedure; additionally, DOE 
evaluated cleaning performance and fabric care based on additional 
testing performed according to the soil/stain removal and mechanical 
action tests specified in AHAM's HLW-2-2020 test method: Performance 
Evaluation Procedures for Household Clothes Washers (``AHAM HLW-2-
2020''). The AHAM HLW-2-2020 test method does not prescribe specific 
test conditions for performing the test (e.g., inlet water temperatures 
conditions, load size, test cycle, or wash/rinse temperature 
selection). For each clothes washer in its test sample, DOE tested the 
Hot Wash/Cold Rinse

[[Page 13600]]

(``Hot'') temperature selection \127\ in the Normal cycle \128\ using 
the large load size \129\ specified in appendix J, as well as using the 
inlet water temperatures and ambient conditions specified in appendix 
J. DOE specifically analyzed the Hot cycle with the large load size 
because (1) the Hot temperature selection would be the temperature 
selection most likely targeted for reduced wash temperature as a design 
option for achieving a higher energy efficiency rating; (2) the large 
load size is more challenging to clean than the small load size; and 
(3) all units in the test sample offer a Hot temperature selection 
(allowing for consistent comparison across units). DOE expects that the 
Hot temperature selection with the large load size is the cycle 
combination most likely to experience the types of performance 
compromises described by AHAM and manufacturers. In sum, DOE selected 
the most conservative assumptions for its performance testing 
investigation to allow DOE to better understand the potential impacts 
on performance at various efficiency levels for clothes washers.
---------------------------------------------------------------------------

    \127\ Figure 2.12.1.2 of appendix J provides a flow chart 
defining the Hot Wash/Cold Rinse temperature selection. Generally, 
the Hot Wash/Cold Rinse temperature selection corresponds to the 
hottest available wash temperature less than 140 [deg]F, with 
certain exceptions as provided in Figure 2.12.1.2.
    \128\ Section 1 of appendix J defines the Normal cycle as the 
cycle recommended by the manufacturer (considering manufacturer 
instructions, control panel labeling, and other markings on the 
clothes washer) for normal, regular, or typical use for washing up 
to a full load of normally soiled cotton clothing.
    \129\ Table 5.1 of appendix J defines the small and large load 
sizes to be tested according to the clothes washer's measured 
capacity.
---------------------------------------------------------------------------

    DOE requests comment on its use of the Hot temperature selection 
with the large load size to evaluate potential impacts on clothes 
washer performance as a result of amended standards.
    More specifically, DOE performed the Soil/Stain Removal test 
specified in section 6 of AHAM HLW-2-2020 to measure relative cleaning 
performance among the test sample units. AHAM HLW-2-2020 states that 
the purpose of the Soil/Stain Removal test is to evaluate the 
performance of household clothes washers in removing representative 
soils and stains from fabric. DOE also performed the Mechanical Action 
test specified in section 7 of AHAM HLW-2-2020 to measure relative 
fabric wear and tear among the test sample units. AHAM HLW-2-2020 
states that the purpose of the Mechanical Action test is to measure the 
mechanical action applied by the clothes washer to the textiles. AHAM 
HLW-2-2020 states that this test may be performed in conjunction with 
the Soil/Stain Removal test; therefore, DOE conducted both tests 
simultaneously on each test run. AHAM HLW-2-2020 specifies running 
three replications of the test method on each tested unit, with the 
results of the three replications averaged.
    DOE requests comment on its use of the Soil/Stain Removal test and 
Mechanical Action test specified in AHAM HLW-2-2020 as the basis for 
evaluating performance-related concerns expressed by AHAM and 
manufacturers.
    The performance characteristics test report provides detailed test 
results in table and graphical format. The discussion throughout the 
remainder of this section summarizes the key conclusions from the test 
results.
    With regard to hot wash temperatures, manufacturer comments (as 
summarized previously in this section) suggested that decreasing water 
temperature to achieve higher efficiency could decrease cleaning 
performance by making it harder to remove fatty soils, which are 
soluble around 85 [deg]F. (See Whirlpool, No. 39 at p. 11) To evaluate 
whether more stringent standards may reduce water temperatures below 
the 85 [deg]F threshold and thus potentially decrease cleaning 
performance for fatty soils, DOE analyzed the wash temperature of the 
hottest temperature selection available in the Normal cycle for each 
clothes washer in the test sample. For front-loading standard-size 
RCWs, DOE's test data show no identifiable correlation between 
efficiency and the hottest available wash temperature in the Normal 
cycle. At the proposed standard level (i.e., TSL 4, corresponding to EL 
3), considering units both slightly higher and slightly lower than EL 
3, the hottest available wash temperature in the Normal cycle ranges 
from around 70 [deg]F to around 140 [deg]F. This closely matches the 
range of the hottest wash temperatures available on units at lower 
efficiency levels, which range from around 80 [deg]F to around 155 
[deg]F. Notably, at EL 3, multiple models from multiple manufacturers 
provide wash temperatures higher than the 85 [deg]F threshold and would 
be able to dissolve and clean fatty soils.
    For top-loading standard-size RCWs, DOE's test data show that for 
units at EL 2 and below, the hottest available wash temperature in the 
Normal cycle ranges from around 70 [deg]F to around 110 [deg]F. At EL 3 
(considering units both slightly higher and slightly lower than EL 3), 
the hottest available wash temperature in the Normal cycle ranges from 
around 80 [deg]F to around 100 [deg]F. Several models from multiple 
manufacturers are available with temperatures higher than the 85 [deg]F 
threshold and would be able to dissolve and clean fatty soils.
    Based on this data, DOE tentatively concludes that the proposed 
standard level (i.e., TSL 4), would not require a substantive reduction 
in hot water temperature on the hottest temperature selection in the 
Normal cycle, and would not preclude the ability to provide wash 
temperatures above the 85 [deg]F threshold.
    DOE requests comment on its wash temperature data presented in the 
performance characteristics test report and on its tentative 
conclusions derived from this data. DOE requests any additional data 
DOE should consider about wash temperatures at the proposed standard 
level, as DOE's data leads to the tentative conclusion that fatty soils 
would be able to be dissolved at this efficiency level.
    With regard to stain removal, manufacturer comments (as summarized 
previously in this section) suggested that more stringent standards 
could result in reduced stain removal, especially for oily or fatty 
stains. (See Whirlpool, No. 39 at p. 11) To evaluate whether more 
stringent standards would result in a decrease in stain removal 
performance, DOE conducted the Soil/Stain Removal test specified in 
AHAM HLW-2-2020 using the Hot temperature selection with the largest 
load size, as described. In particular, one of the stains evaluated in 
the AHAM HLW-2-2020 Soil/Stain Removal test is sebum--an oily, waxy 
substance produced by skin glands.\130\ For front-loading standard-size 
RCWs, DOE's test data show no observable correlation between efficiency 
and the total cleaning score as measured by the AHAM test method. At EL 
3 (considering units both slightly higher and slightly lower than EL 
3), total cleaning scores ranged from around 86 to around 99 (higher is 
better). At lower efficiency levels, total cleaning scores ranged from 
around 90 to around 96.
---------------------------------------------------------------------------

    \130\ The standardized soil/stain strips used in the AHAM HLW-2-
2020 test consist of square test fabric swatches carrying five 
different types of stains: red wine, chocolate and milk, blood, 
carbon black/mineral oil, and pigment/sebum.
---------------------------------------------------------------------------

    For top-loading standard-size RCWs, DOE's test data show that for 
units at EL 2 and below, total cleaning scores range from around 90 to 
around 98. The clustering of data at or above a score of 90 (as 
measured on the Hot temperature selection with the large load size) 
likely represents a market-representative threshold of stain removal 
performance as measured with this cycle configuration. DOE's total 
cleaning

[[Page 13601]]

scores at EL 3 for stain removal also include 90, which indicates that 
manufacturers can produce clothes washers at EL 3 while maintaining a 
level of stain removal that is market-representative. DOE also looked 
at the implementation of prioritizing hardware design options over 
reduced wash temperatures. When hardware design options are 
implemented, DOE's analysis suggests that the proposed standard level 
would not preclude the ability to provide total cleaning scores for 
top-loading units equally as high as the highest scores currently 
achieved by units at lower efficiency levels.
    DOE requests comment on its stain removal data presented in the 
performance characteristics test report and on its conclusions derived 
from this data. In particular, DOE requests comment on whether the 
clustering of data at or above a score of 90 (as measured on the Hot 
temperature selection with the large load size) corresponds to a 
market-representative threshold of stain removal performance as 
measured with this cycle configuration. DOE additionally requests 
comment on its analysis indicating that implementing additional 
hardware design options, rather than reducing wash temperatures, on EL 
2 units could enable total cleaning scores at EL 3 that are equally as 
high as the highest scores currently achieved by units at lower 
efficiency levels.
    With regard to wear and tear, manufacturer comments (as summarized 
previously in this section) suggested that if wash time is lengthened 
to compensate for reduced water temperatures, the additional agitation 
on the clothes may lead to increased fabric wear and damage. (See 
Whirlpool, No. 39 at pp. 10-11; AHAM, No. 40 at pp. 9-10) To evaluate 
whether more stringent standards would result in an increase in wear 
and tear on clothing, DOE conducted the Mechanical Action test 
specified in AHAM HLW-2-2020 concurrently with the stain removal test 
as described. For top-loading standard-size RCWs, DOE's test data show 
that units at EL 3 have lower (i.e., better) mechanical action scores 
than baseline-rated units, indicating that the higher-efficiency units 
provide less wear and tear than the baseline units in the test sample. 
Specifically, at EL 3, mechanical action scores ranged from around 150 
to around 175, closely matching the range at EL 2, which ranged from 
around 150 to around 170. At lower efficiency levels, mechanical action 
scores ranged from around 190 to around 230. The data suggests that the 
better mechanical action scores at the higher efficiency levels may 
correlate with the use of wash plates (i.e., impellers) at those 
levels, compared to the use of traditional agitators at the lower 
efficiency levels.
    For front-loading standard-size RCWs, DOE's test data show that for 
units at or below EL 2, mechanical action scores range from around 135 
to around 180. At EL 3 (considering units both slightly higher and 
slightly lower than EL 3), mechanical action scores range from around 
160 to around 210. Although some units at EL 3 have higher (i.e., 
worse) mechanical action scores than the lower-efficiency units, the 
low end of the range is less than (i.e., better than) some of the 
baseline-rated units. DOE is not aware of any industry-accepted 
threshold for acceptable mechanical action performance, and there is no 
significant clustering of DOE's data to suggest any particular market-
representative threshold.
    Based on this data, DOE tentatively concludes that the proposed 
standard level (i.e., TSL 4) would not preclude the ability to provide 
mechanical action scores comparable to the scores for units at lower 
efficiency levels.
    DOE requests comment on its mechanical action data presented in the 
performance characteristics test report and on its conclusions derived 
from this data. In particular, DOE requests comment on whether there is 
a market-representative threshold of mechanical action performance as 
measured on the Hot temperature selection using the large load size. 
DOE also requests comment on whether better mechanical action scores at 
higher top-loading efficiency levels are attributable to the use of 
wash plates rather than traditional agitators in those higher-
efficiency units.
    With regard to cycle time, manufacturer comments (as summarized 
previously in this section) suggested that more stringent standards 
could require an increase in cycle time. (See Whirlpool, No. 39 at p. 
9; AHAM, No. 40 at p. 10). To evaluate whether more stringent standards 
would result in an increase in cycle time, DOE measured the average 
cycle time as defined in appendix J for each unit in the test sample. 
For both top-loading standard-size and front-loading standard-size 
RCWs, DOE's test data show no observable correlation between efficiency 
and average cycle time. For top-loading standard-size RCWs, the average 
cycle time for the entire product class is around 50 minutes, as 
measured according to the appendix J test procedure. At EL 3 
(considering units both slightly higher and slightly lower than EL 3), 
cycle time ranged from around 35 minutes to around 65 minutes. This 
closely matches the range of units at lower efficiency levels, which 
ranged from around 35 minutes to around 70 minutes. For front-loading 
standard-size RCWs, the average cycle time for the entire product class 
is around 45 minutes, as measured according to the appendix J test 
procedure. At EL 3 (considering units both slightly higher and slightly 
lower than EL 3), cycle time ranged from around 40 minutes to around 55 
minutes. This closely matches the range of units at lower efficiency 
levels, which ranged from around 35 minutes to around 65 minutes.
    Based on this data, DOE tentatively concludes that the proposed 
standard level (i.e., TSL 4), would not result in an increase in 
average cycle time as measured by appendix J.
    DOE requests comment on its cycle time data presented in the 
performance characteristics test report and on its conclusions derived 
from this data.
    In summary, DOE's test data suggest that the proposed standard 
level (i.e., TSL 4) can be achieved with key performance attributes 
(e.g., wash temperatures, stain removal, mechanical action, and cycle 
duration) that are largely comparable to the performance of lower-
efficiency units available on the market today. Based on DOE's testing 
of models that currently meet the proposed standards, DOE does not 
expect performance to be compromised at the proposed standard level.
    DOE seeks comment on its testing and assessment of performance 
attributes (i.e., wash temperatures, stain removal, mechanical action, 
and cycle duration), particularly at the proposed standard level (i.e., 
TSL 4). In addition, DOE seeks additional data that stakeholders would 
like DOE to consider on performance attributes at TSL 4 efficiencies as 
well as the current minimum energy conservation standards.
b. Availability of ``Traditional'' Agitators
    The inner drum of a baseline standard-size top-loading RCW 
typically contains a vertically oriented agitator in the center of the 
drum, which undergoes a twisting motion. The motion of the agitator, 
which is powered by an electric motor, circulates the clothes around 
the center of the wash basket. Some agitators have a corkscrew-like 
design that also circulates the clothing vertically from the bottom to 
the top of the basket. Higher-efficiency top-loading RCWs typically use 
a disk-shaped ``wash plate,'' rather than a vertical agitator, to move 
the clothes within the basket. The rotation of the wash plate

[[Page 13602]]

underneath the clothing circulates the clothes throughout the wash 
drum.
    A conventional agitator requires clothing to be fully suspended in 
water; as the agitator rotates, the agitator vanes catch the clothing 
and move the garments through the water. A rotating wash plate, 
however, requires a much lower water level inside the wash tub to clean 
the clothing properly. The wet clothing load sits on top of the wash 
plate, and as the wash plate rotates, raised fins catch the clothing 
along the bottom of the wash tub to rotate the garments.
    AHAM presented shipment data that showed the number of shipments of 
clothes washers with and without agitators during 2011-2020. (AHAM, No. 
40 at pp. 11-12) Based on this data, AHAM concluded that consumer 
preference has shifted over the years in favor of clothes washers with 
agitators. (Id.) AHAM commented that manufacturers have introduced or 
re-introduced top-loading clothes washers with agitator technology due 
to increasing demand from consumers and from consumer complaints that 
there does not appear to be enough water in the wash load, and that 
clothes do not appear to be getting clean, in top-loading clothes 
washers without agitators. (Id.) AHAM asserted that the efficiency 
levels DOE analyzed in the September 2021 Preliminary Analysis are 
likely to remove products from the market that are highly rated for 
consumer satisfaction and reliability, and recommended that DOE's 
efficiency standards not lead to these products being removed from the 
market. (Id.)
    Whirlpool commented that consumers are increasingly demanding top-
loading clothes washers with agitators, perhaps due in part to any 
negative experiences that consumers may have had with previous front-
loading or top-loading clothes washers with a wash plate. (Whirlpool, 
No. 39 at p. 15) Whirlpool presented data showing that 72 percent of 
top-loading clothes washer shoppers are looking for a clothes washer 
with an agitator. (Id.) Whirlpool also presented data showing that top-
loading clothes washers with wash plates once made up about 54 percent 
of all top-loading shipments, and that number has since declined to 34 
percent. (Id.) Whirlpool commented that manufacturers have responded to 
this demand shift in large part by offering a broad assortment of 
agitator clothes washers. (Id.) Whirlpool noted that two major 
competitors to Whirlpool have recently introduced their first ever top-
loading agitator models over the past few years. (Id.) Whirlpool 
asserted that any amended standards from DOE that would preclude 
manufacturers from being able to offer top-loading clothes washers with 
agitators would be problematic for their consumers. (Id.)
    Whirlpool expressed concern that if the top-loading standard level 
were amended to EL 2 or above, agitators would be phased out from the 
U.S. market and would be replaced by wash plates. (Whirlpool, No. 39 at 
pp. 3-4) Whirlpool recommended that DOE consider not amending the top-
loading clothes washer standards, which would allow traditional 
agitator clothes washers to stay on the market. (Whirlpool, No. 39 at 
p. 20)
    Whirlpool described the two different types of agitators used in 
clothes washers today: traditional agitators that have an internal 
mechanism driving the barrel of the agitator in a single direction, and 
high-efficiency agitators that have the barrel of the agitator fixed to 
or molded as part of the wash plate. (Id.) Whirlpool further explained 
that traditional agitators operate in deeper water, and the motion of 
the agitator generates the flow of clothing within the wash bath; 
whereas high-efficiency agitators use less water and rely on fabric-to-
fabric shear to move the clothing within the drum. (Id.) Whirlpool 
commented that consumers may notice that high-efficiency agitator 
clothes washers use less water or require a longer cycle time than 
traditional agitator clothes washers. (Id.) Whirlpool asserted that 
many consumers have used traditional agitator clothes washers for their 
entire lives and may not readily accept the performance, water level, 
and wash motion differences between agitator and non-agitator models. 
(Id.)
    As discussed further in section V.C.1 of this document, DOE is 
proposing to adopt an amended standard for top-loading, standard-size 
clothes washers that corresponds to the CEE Tier 1 level. DOE's market 
analysis indicates that top loading models currently on the market at 
TSL 4 use wash plates (i.e., do not have agitators). DOE is aware of 
top-loading clothes washers without an agitator that achieve equal or 
better cleaning performance than top-loading clothes washers with a 
traditional-style agitator in third-party performance reviews. 
According to Consumer Reports, among 40 tested RCW models with a 
traditional-style agitator, 4 models (10 percent) receive a relative 
``washing performance'' rating of 5 out of 5, and 13 models (33 
percent) receive a relative rating of 4 out of 5--for a total of 43 
percent of units receiving a score of 4 or 5 out of 5. Among 36 tested 
models with a high-efficiency wash plate design, 11 models (30 percent) 
receive a relative rating of 5 out of 5, and 14 models (39 percent) 
receive a relative rating of 4 out of 5--for a total of 69 percent of 
units receiving a score of 4 or 5 out of 5. These ratings indicate that 
clothes washers with high-efficiency wash plate designs can achieve 
equal or better overall cleaning performance scores than clothes 
washers with traditional-style agitators.
    As discussed, DOE recognizes that the Consumer Reports cleaning 
performance test method is inconsistent with the test conditions 
prescribed by DOE's appendix J test procedure and that products with 
superior cleaning performance ratings may sacrifice or trade off with 
one or more other aspects of consumer-relevant performance.
    DOE seeks comment on any aspects of cleaning performance that 
provide differentiation between the use of an agitator or a wash plate 
that are not reflected in the Consumer Reports washing performance 
ratings evaluated in this NOPR.
    DOE seeks comment on whether any lessening of the utility or 
performance of top-loading standard-size RCWs, in accordance with 42 
U.S.C. 6295(o)(2)(B)(i)(IV), would result from a potential standard 
that would preclude the use of a traditional agitator. In particular, 
DOE seeks information and data on how such utility or performance would 
be measured or evaluated.
c. Water Levels
    Each higher efficiency level considered by DOE corresponds to a 
higher WER value compared to the baseline level. Higher WER values are 
achieved through the use of less water during the cycle, which 
generally achieved through lower water levels during the wash and/or 
rinse portions of the cycle.
    Whirlpool expressed concern that decreasing water levels and wash 
temperatures would negatively impact consumer perceptions that their 
clothes washers are working correctly. (Whirlpool, No. 39 at pp. 12-14) 
Whirlpool stated that across all manufacturers and brands, it saw 
customer sentiment scores for water level and wash temperatures were 
net positive for clothes washers that were rated at 6.5 IWF (the 
current DOE baseline level for top-loading clothes washers), and that 
customer sentiment scores were net negative for clothes washers rated 
at 4.3 IWF (the ENERGY STAR Most Efficient level for standard-size 
clothes washers). (Id.) Whirlpool added that decreasing water usage, 
and therefore increasing detergent concentration, does not correlate to 
improved consumer satisfaction. (Id.)

[[Page 13603]]

Whirlpool commented that it received consumer complaints about water 
levels being too low and not completely covering their clothes, and 
predicted that consumer complaints would increase with any amended 
standards that would drive a further decrease in water levels. (Id.) 
Whirlpool added that lowering water levels in order to meet amended 
standards may leave its clothes washers without enough free water to 
support the degree of load motion needed to maintain consumer 
satisfaction. (Id.)
    Whirlpool further stated that consumers strongly demand flexibility 
in water level. (Whirlpool, No. 39 at p. 15) Whirlpool commented that 
manufacturers have responded to this demand for flexibility by offering 
deep fill and deep-water wash options on top-loading clothes washers. 
(Id.) Whirlpool commented that in the entire top-loading clothes washer 
segment, Whirlpool is only aware of three models that do not have deep 
fill options. (Id.) Whirlpool expressed concern that amended standards 
could erode Whirlpool's ability to offer consumers this flexibility. 
(Id.)
    Whirlpool commented that manufacturers have taken several actions 
during and since the last updates to DOE and ENERGY STAR standards to 
communicate, educate, and set appropriate consumer expectations for 
performance. (Whirlpool, No. 39 at pp. 14-16) For example, Whirlpool 
explained that on its websites, it has created a page that describes 
the various differences between clothes washers with agitators versus 
clothes washers with wash plates that details how both types of clothes 
washers work to clean clothes, the differences in water levels between 
these types of clothes washers, the benefits of each type of clothes 
washer, and how to find the right type of clothes washer. (Id.) 
Whirlpool added that it also works to educate retail associates about 
these fundamental differences between clothes washers to communicate 
this information to consumers and answer any questions they may have 
while shopping. (Id.) Whirlpool commented that despite manufacturers' 
collective efforts to educate consumers about efficient clothes washers 
and how they perform, consumers may still not accept new clothes 
washers that use less energy and water. (Id.)
    Whirlpool stated that higher levels of torque are needed to move 
clothes in top-loading clothes washers with lower water levels, which 
creates more resistance when trying to move clothes around during the 
wash phase. (Whirlpool, No. 39 at p. 8) Whirlpool commented that 
increased resistance and torque create higher levels of stress on many 
components, cause components to wear out more quickly, and lead to 
hotter motor temperatures, which requires increased dwell period for 
cooling. (Id.) Whirlpool suggested that DOE capture the cost and 
product changes necessitated by the additional torque needed to move 
clothes in a wash basket with lower wash levels. (Id.)
    Whirlpool commented that it would expect a rebound effect to occur 
for clothes washers as a result of amended standards. Whirlpool 
commented that consumers who are dissatisfied with the water level in 
the DOE-tested cycle will likely take some sort of action to 
compensate, including adding their own water to the cycle or choosing 
to largely or exclusively use deep fill and deep water wash options on 
their clothes washer. Whirlpool added that if consumers are 
dissatisfied with cleaning and rinse performance, they may decide to 
wash smaller loads (thereby increasing the number of annual cycles), 
use warmer wash temperatures, pretreat clothes or use options such as 
second rinse and pre-soak, or wash a load multiple times. (Whirlpool, 
No. 39 at pp. 17-18) GEA commented that based on its consumer 
preference data, consumers expressed a strong preference for control 
over the amount of water used in their clothes washers. (GEA, No. 38 at 
p. 2) GEA found that typically, consumers prefer to add more water to 
their wash load. (Id.)
    AHAM commented that manufacturers have experienced consumer 
pushback as a result of reducing water use. (AHAM, No. 40 at p. 11) 
AHAM noted that, while consumers typically use the normal cycle, most 
top-loading clothes washers include a deep fill option in order to 
address consumer interest in the ability to increase water levels. 
(Id.) AHAM added that as a result of reduced water use, consumers tend 
to rely on deep-fill settings, or add water to their clothes washers 
themselves. (Id.) AHAM commented that a significant portion of 
consumers dislike clothes washers with low water levels. (Id.)
    AHAM commented that the effects of strict water requirements may 
lead to consumer perceptions of inadequate cleaning performance, and 
will likely cause consumers to take actions that cause efficiency 
performance to diverge from DOE's projections. AHAM added that this 
could amount to a negative ``rebound effect,'' where higher efficiency 
requirements lead to increased energy and water use due to consumers 
responding to inadequate performance at stringent efficiency levels. 
(AHAM, No. 40 at p. 10)
    AHAM noted that, while consumers typically use the normal cycle, 
most top-loading clothes washers include a deep fill option in order to 
address consumer interest in the ability to increase water levels.
    As discussed, DOE has considered potential impacts to the various 
attributes of product performance as part of its consideration of 
amended standards, as discussed further in section V.C.1 of this 
document. To the extent that water levels correlate with cleaning and 
rinsing performance or other relevant attributes of clothes washer 
performance, DOE has considered such impacts as part of its analysis.
    DOE requests comment and information on sales of RCWs with deep 
fill and/or deep rinse options or settings and the frequency of use of 
cycles with these options or settings selected.
d. Availability of Portable Products
    As discussed, top-loading portable RCWs are generally mounted on 
caster wheels, which allows the clothes washer to be moved more easily.
    AHAM commented that the proposed energy conservation standards 
could impact portable clothes washers and cause features of portability 
and lower price points to be lost. (AHAM, No. 40 at p. 16) AHAM added 
that the loss of low priced and portable top-loading clothes washers 
would raise equity concerns. (Id.)
    DOE's testing and analysis of top-loading standard-size portable 
units indicates that such products would be able to achieve the 
proposed standard level for the top-loading standard-size product class 
with only small changes to the final spin portion of the cycle (e.g., 
to implement ``consistent spin'') and a minor reduction in water use. 
Accordingly, DOE tentatively determines that the proposed standard 
level would not preclude the availability of portable clothes washers 
from the market.
e. Conclusion
    For the reasons discussed in the previous sections, DOE has 
tentatively concluded that the standards proposed in this NOPR would 
not lessen the utility or performance of the RCWs under consideration 
in this proposed rulemaking.
5. Impact of Any Lessening of Competition
    DOE considered any lessening of competition that would be likely to 
result from new or amended standards.

[[Page 13604]]

As discussed in section III.F.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 proposed rulemaking.
    Energy conservation resulting from potential energy conservation 
standards for RCWs is expected to yield environmental benefits in the 
form of reduced emissions of certain air pollutants and greenhouse 
gases. Table V.29 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.29--Cumulative Emissions Reduction for Residential Clothes Washers Shipped in 2027-2056
----------------------------------------------------------------------------------------------------------------
                                                               Trial standard level
                                 -------------------------------------------------------------------------------
                                         1               2               3               4               5
----------------------------------------------------------------------------------------------------------------
                                             Power Sector Emissions
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons).......            20.4            20.6            24.2            49.0            79.3
CH4 (thousand tons).............             1.5             1.5             1.8             3.4             4.9
N2O (thousand tons).............             0.2             0.2             0.2             0.5             0.7
NOX (thousand tons).............            11.4            11.5            13.2            28.3            48.8
SO2 (thousand tons).............             8.8             8.9            10.8            19.7            28.1
Hg (tons).......................             0.1             0.1             0.1             0.1             0.2
----------------------------------------------------------------------------------------------------------------
                                               Upstream Emissions
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons).......             1.7             1.7             1.9             4.2             7.3
CH4 (thousand tons).............           161.9           163.4           186.6           408.1           713.3
N2O (thousand tons).............             0.0             0.0             0.0             0.0             0.0
NOX (thousand tons).............            25.5            25.7            29.5            64.1           111.4
SO2 (thousand tons).............             0.1             0.1             0.1             0.2             0.3
Hg (tons).......................             0.0             0.0             0.0             0.0             0.0
----------------------------------------------------------------------------------------------------------------
                                               Total FFC Emissions
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons).......            22.1            22.3            26.1            53.2            86.6
CH4 (thousand tons).............           163.4           164.9           188.4           411.4           718.3
N2O (thousand tons).............             0.2             0.2             0.3             0.5             0.7
NOX (thousand tons).............            36.9            37.2            42.7            92.4           160.2
SO2 (thousand tons).............             8.9             9.0            10.9           199.9            28.5
Hg (tons).......................             0.1             0.1             0.1             0.1             0.2
----------------------------------------------------------------------------------------------------------------

    As part of the analysis for this proposed rulemaking, DOE estimated 
monetary benefits likely to result from the reduced emissions of 
CO2 that DOE estimated for each of the considered TSLs for 
RCWs. Section IV.L of this document discusses the SC-CO2 
values that DOE used. Table V.30 presents the value of CO2 
emissions reduction at each TSL for each of the SC-CO2 
cases. The time-series of annual values is presented for the proposed 
TSL in chapter 14 of the NOPR TSD.

[[Page 13605]]



    Table V.30--Present Value of CO2 Emissions Reduction for Residential Clothes Washers Shipped in 2027-2056
----------------------------------------------------------------------------------------------------------------
                                                                            SC-CO2 case
                                                 ---------------------------------------------------------------
                                                                   Discount rate and statistics
                                                 ---------------------------------------------------------------
                       TSL                              5%              3%             2.5%             3%
                                                 ---------------------------------------------------------------
                                                                                                       95th
                                                      Average         Average         Average       percentile
----------------------------------------------------------------------------------------------------------------
                                                                          (billion 2021$)
----------------------------------------------------------------------------------------------------------------
1...............................................             219             924           1,437           2,814
2...............................................             221             933           1,451           2,841
3...............................................             258           1,088           1,694           3,313
4...............................................             509           2,174           3,394           6,613
5...............................................             812           3,496           5,470          10,628
----------------------------------------------------------------------------------------------------------------

    As discussed in section IV.L.2 of this document, DOE estimated the 
climate benefits likely to result from the reduced emissions of methane 
and N2O that DOE estimated for each of the considered TSLs 
for RCWs. Table V.31 presents the value of the CH4 emissions 
reduction at each TSL, and Table V.32 presents the value of the 
N2O emissions reduction at each TSL. The time-series of 
annual values is presented for the proposed TSL in chapter 14 of the 
NOPR TSD.

  Table V.31--Present Value of Methane Emissions Reduction for Residential Clothes Washers Shipped in 2027-2056
----------------------------------------------------------------------------------------------------------------
                                                                            SC-CH4 case
                                                 ---------------------------------------------------------------
                                                                   Discount rate and statistics
                                                 ---------------------------------------------------------------
                       TSL                              5%              3%             2.5%             3%
                                                 ---------------------------------------------------------------
                                                                                                       95th
                                                      Average         Average         Average       percentile
----------------------------------------------------------------------------------------------------------------
                                                                          (billion 2021$)
----------------------------------------------------------------------------------------------------------------
1...............................................              74             214             297             567
2...............................................              74             216             299             572
3...............................................              84             246             341             652
4...............................................             179             530             738           1,403
5...............................................             307             917           1,280           2,428
----------------------------------------------------------------------------------------------------------------


 Table V.32--Present Value of Nitrous Oxide Emissions Reduction for Residential Clothes Washers Shipped in 2027-
                                                      2056
----------------------------------------------------------------------------------------------------------------
                                                                            SC-N2O Case
                                                 ---------------------------------------------------------------
                                                                   Discount rate and statistics
                                                 ---------------------------------------------------------------
                       TSL                              5%              3%             2.5%             3%
                                                 ---------------------------------------------------------------
                                                                                                       95th
                                                      Average         Average         Average       percentile
----------------------------------------------------------------------------------------------------------------
                                                                          (billion 2021$)
----------------------------------------------------------------------------------------------------------------
1...............................................            0.80            3.11            4.79            8.28
2...............................................            0.80            3.14            4.84            8.36
3...............................................            0.96            3.77            5.81           10.02
4...............................................            1.76            6.97           10.78           18.56
5...............................................            2.56           10.22           15.84           27.21
----------------------------------------------------------------------------------------------------------------

    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 
global and U.S. economy continues to evolve rapidly. DOE, together with 
other Federal

[[Page 13606]]

agencies, will continue to review 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 health benefits 
associated with NOX and SO2 emissions reductions 
anticipated to result from the considered TSLs for RCWs. The dollar-
per-ton values that DOE used are discussed in section IV.L of this 
document. Table V.33 presents the present value for NOX 
emissions reduction for each TSL calculated using 7-percent and 3-
percent discount rates, and Table V.34 presents similar results for 
SO2 emissions reductions. The results in these tables 
reflect application of EPA's low dollar-per-ton values, which DOE used 
to be conservative. The time-series of annual values is presented for 
the proposed TSL in chapter 14 of the NOPR TSD.

  Table V.33--Present Value of NOX Emissions Reduction for Residential
                  Clothes Washers Shipped in 2027-2056
------------------------------------------------------------------------
                                            3% Discount     7% Discount
                   TSL                         rate            rate
------------------------------------------------------------------------
                                                  (million 2021$)
                                         -------------------------------
1.......................................           1,467             634
2.......................................           1,481             641
3.......................................           1,712             739
4.......................................           3,468           1,441
5.......................................           5,684           2,304
------------------------------------------------------------------------


  Table V.34--Present Value of SO2 Emissions Reduction for Residential
                  Clothes Washers Shipped in 2027-2056
------------------------------------------------------------------------
                                            3% Discount     7% Discount
                   TSL                         rate            rate
------------------------------------------------------------------------
                                                  (million 2021$)
                                         -------------------------------
1.......................................             505             225
2.......................................             510             227
3.......................................             615             272
4.......................................           1,098             472
5.......................................           1,540             650
------------------------------------------------------------------------

    DOE has not considered the monetary benefits of the reduction of Hg 
for this proposed rule. Not all the public health and environmental 
benefits from the reduction of greenhouse gases, NOx, and 
SO2 are captured in the previous values, and additional 
unquantified benefits from the reductions of those pollutants as well 
as from the reduction of Hg, direct PM, and other co-pollutants may be 
significant.
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.35 presents the NPV values that result from adding the 
estimates of the potential economic benefits resulting from reduced 
GHG, NOX, and SO2 emissions to the NPV of 
consumer benefits calculated for each TSL considered in this proposed 
rulemaking. The consumer benefits are domestic U.S. monetary savings 
that occur as a result of purchasing the covered products, 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 RCWs shipped in 2027-2056.

          Table V.35--Consumer NPV Combined With Present Value of Climate Benefits and Health Benefits
----------------------------------------------------------------------------------------------------------------
            Category                   TSL 1           TSL 2           TSL 3           TSL 4           TSL 5
----------------------------------------------------------------------------------------------------------------
                   Using 3% discount rate for Consumer NPV and Health Benefits (billion 2021$)
----------------------------------------------------------------------------------------------------------------
5% Average SC-GHG case..........            10.7            10.8            10.8            19.8            29.1
3% Average SC-GHG case..........            11.5            11.6            11.8            21.8            32.4
2.5% Average SC-GHG case........            12.1            12.2            12.5            23.2            34.8
3% 95th percentile SC-GHG case..            13.7            13.9            14.4            27.1            41.1
----------------------------------------------------------------------------------------------------------------
                   Using 7% discount rate for Consumer NPV and Health Benefits (billion 2021$)
----------------------------------------------------------------------------------------------------------------
5% Average SC-GHG case..........             4.5             4.6             3.8             7.7            11.8
3% Average SC-GHG case..........             5.4             5.4             4.8             9.8            15.1

[[Page 13607]]

 
2.5% Average SC-GHG case........             6.0             6.0             5.5            11.2            17.4
3% 95th percentile SC-GHG case..             7.6             7.7             7.5            15.1            23.7
----------------------------------------------------------------------------------------------------------------

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 
RCWs 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 forego 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.\131\
---------------------------------------------------------------------------

    \131\ 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.\132\ 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.
---------------------------------------------------------------------------

    \132\ 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 June 
12, 2022).
---------------------------------------------------------------------------

1. Benefits and Burdens of TSLs Considered for Residential Clothes 
Washer Standards
    Table V.36 and Table V.37 summarize the quantitative impacts 
estimated for each TSL for RCWs. The national impacts are measured over 
the lifetime of RCWs 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.

[[Page 13608]]



         Table V.36--Summary of Analytical Results for Residential Clothes Washer TSLs: National Impacts
----------------------------------------------------------------------------------------------------------------
            Category                   TSL 1           TSL 2           TSL 3           TSL 4           TSL 5
----------------------------------------------------------------------------------------------------------------
                                     Cumulative FFC National Energy Savings
----------------------------------------------------------------------------------------------------------------
Quads...........................            0.61            0.62            0.74            1.45            2.27
----------------------------------------------------------------------------------------------------------------
                                       Cumulative FFC Emissions Reduction
----------------------------------------------------------------------------------------------------------------
CO2 (million metric tons).......           22.11           22.32           26.13           53.21           86.62
CH4 (thousand tons).............          163.41          164.89          188.43          411.43          718.26
N2O (thousand tons).............            0.21            0.21            0.26            0.48            0.71
NOX (thousand tons).............           36.90           37.24           42.73           92.39          160.21
SO2 (thousand tons).............            8.88            8.96           10.88           19.93           28.45
Hg (tons).......................            0.06            0.06            0.07            0.13            0.18
----------------------------------------------------------------------------------------------------------------
                      Present Value of Benefits and Costs (3% discount rate, billion 2021$)
----------------------------------------------------------------------------------------------------------------
Consumer Operating Cost Savings.           13.46           13.60           19.88           27.83           35.68
Climate Benefits *..............            1.14            1.15            1.34            2.71            4.42
Health Benefits **..............            1.97            1.99            2.33            4.57            7.22
Total Benefits [dagger].........           16.57           16.74           23.54           35.11           47.32
Consumer Incremental Product                5.07            5.10           11.75           13.31           14.91
 Costs [Dagger].................
Consumer Net Benefits...........            8.39            8.50            8.13           14.52           20.77
Total Net Benefits..............           11.50           11.64           11.79           21.80           32.41
----------------------------------------------------------------------------------------------------------------
                      Present Value of Benefits and Costs (7% discount rate, billion 2021$)
----------------------------------------------------------------------------------------------------------------
Consumer Operating Cost Savings.            6.36            6.43            9.20           12.73           16.12
Climate Benefits *..............            1.14            1.15            1.34            2.71            4.42
Health Benefits **..............            0.86            0.87            1.01            1.91            2.95
Total Benefits [dagger].........            8.36            8.45           11.55           17.35           23.50
Consumer Incremental Product                3.00            3.02            6.72            7.58            8.45
 Costs [Dagger].................
Consumer Net Benefits...........            3.36            3.41            2.48            5.14            7.68
Total Net Benefits..............            5.36            5.43            4.83            9.77           15.05
----------------------------------------------------------------------------------------------------------------
Note: This table presents the costs and benefits associated with RCWs 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 SC-CO2, SC-CH4, and SC-N2O. Together
  these represent the global 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. 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 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 consumer, climate, and health benefits. 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 sets of SC-GHG estimates.
[Dagger] Costs include incremental equipment costs as well as installation costs.


                                        Table V.37--Summary of Analytical Results for Residential Clothes Washer TSLs: Manufacturer and Consumer Impacts
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
              Category                           TSL 1 *                         TSL 2 *                         TSL 3 *                         TSL 4 *                       TSL 5 *
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                      Manufacturer Impacts
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Industry NPV (million 2021$) (No-    1,680.4 to 1,746.4............  1,636.5 to 1,702.9............  1,490.3 to 1,631.0............  1,208.1 to 1,376.7............  798.7 to 985.9.
 new-standards case INPV = 1,738).
Industry NPV (% change) **.........  (3.3) to 0.5..................  (5.9) to (2.0)................  (14.3) to (6.2)...............  (30.5) to (20.8)..............  (54.1) to (43.3).
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                              Consumer Average LCC Savings (2021$)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Semi-Automatic.....................  $329..........................  $329..........................  $329..........................  $329..........................  $219.
Top-Loading, Ultra-Compact.........  n.a...........................  n.a...........................  n.a...........................  n.a...........................  n.a.
Top-Loading, Standard-Size.........  $138..........................  $138..........................  $115..........................  $134..........................  $157.
Front-Loading, Compact.............  $0............................  $0............................  $0............................  $7............................  $56.
Front-Loading, Standard-Size.......  $57...........................  $78...........................  $78...........................  $19...........................  $55.

[[Page 13609]]

 
Shipment-Weighted Average *........  $119..........................  $124..........................  $107..........................  $107..........................  $132.
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                   Consumer Simple PBP (years)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Semi-Automatic.....................  0.3...........................  0.3...........................  0.3...........................  0.3...........................  0.4.
Top-Loading, Ultra-Compact.........  n.a...........................  n.a...........................  n.a...........................  n.a...........................  n.a.
Top-Loading, Standard-Size.........  4.6...........................  4.6...........................  6.8...........................  5.9...........................  5.5.
Front-Loading, Compact.............  0.0...........................  0.0...........................  0.0...........................  9.1...........................  7.1.
Front-Loading, Standard-Size.......  2.8...........................  2.4...........................  2.4...........................  3.2...........................  3.4.
Shipment-Weighted Average *........  4.0...........................  3.9...........................  5.5...........................  5.2...........................  4.9.
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                         Percent of Consumers that Experience a Net Cost
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Semi-Automatic.....................  0%............................  0%............................  0%............................  0%............................  0%.
Top-Loading, Ultra-Compact.........  n.a...........................  n.a...........................  n.a...........................  n.a...........................  n.a.
Top-Loading, Standard-Size.........  14%...........................  14%...........................  28%...........................  25%...........................  23%.
Front-Loading, Compact.............  0%............................  0%............................  0%............................  24%...........................  29%.
Front-Loading, Standard-Size.......  0%............................  0%............................  0%............................  24%...........................  18%.
Shipment-Weighted Average *........  11%...........................  11%...........................  20%...........................  24%...........................  21%.
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
The entry ``n.a.'' means not applicable because there is no change in the standard at certain TSLs.
* Weighted by shares of each product class in total projected shipments in 2027.
** Parentheses indicate negative (-) values.

    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)) 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)(I)-(VII)) For 
this NOPR, DOE considered the impacts of amended standards for RCWs 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.
    Samsung commented that top-loading standard-size clothes washers, 
which cover roughly 70 percent of the marketplace, offer the greatest 
efficiency improvement opportunity and should be set to EL 3, which is 
included in TSL 4. (Samsung, No. 41 at pp. 2-3) Samsung added that 
DOE's analysis demonstrates a practical payback period of 4.2 years for 
top-loading standard-size RCWs, and DOE's engineering analysis shows 
that slight adjustments to wash temperature, spray rinse, and changing 
to a direct drive motor can contribute to a significant National Energy 
Savings of 1.85 quads. (Id.) Samsung added that direct drive motor and 
inverter control technology have matured over the years and have become 
highly cost competitive. (Id.) Samsung commented that it predicts these 
technologies will commonly be used in the near term given the benefits 
to energy efficiency, quiet operation, and high reliability. (Id.) 
Samsung noted that increasing efficiency for top-loading standard-size 
clothes washers becomes especially important if DOE's consumer choice 
model indicates that the top-loading market share will increase with 
increased minimum energy performance standards on top-loading standard-
size clothes washers. (Id.)
    Samsung recommended that to realize savings for front-loading 
standard-size clothes washers, DOE should adopt EL 2, which is included 
in TSL 2 and TSL 3. (Samsung, No. 41 at p. 3) Samsung commented that 
when comparing the models listed in DOE's CCD and those listed in EPA's 
Qualified Products List, 78 percent of front-loading standard-size 
models meet EL 2 proposed in the September 2021 Preliminary TSD. (Id.) 
Samsung noted that increasing the MEPS beyond EL 2 provides diminishing 
returns in the form of a longer payback period. (Id.) Samsung commented 
that going forward, if DOE expects consumers to adopt top-loading 
clothes washers, improvement in National Energy Savings for front-
loading clothes washers becomes negligible as efficiency level 
increases. (Id.)
    As discussed, DOE evaluated each TSL, beginning with the maximum 
technologically feasible level, to determine the highest efficiency 
level that is both technologically feasible and economically justified 
and saves a significant amount of energy. The following paragraphs 
summarize the results of this evaluation. In particular, the summary 
discussion emphasizes the impacts on the top-loading standard-size and 
front-loading standard-size product classes, which together represent 
96 percent of the market, as presented in Table IV.34 of this document.
    DOE first considered TSL 5, which represents the max-tech 
efficiency levels for all product classes. Specifically for top-loading 
standard-size RCWs, DOE's expected design path for TSL 5 (which 
represents EL 4 for this product class) incorporates the use of a 
stainless-steel basket, a direct drive motor, a wash plate, reduced hot 
and warm wash water temperatures compared to temperatures available on 
baseline units, an increased tub size compared to the baseline, and the 
fastest achievable spin speeds. In particular, the faster spin speeds 
and reduced hot and warm wash temperatures provide the improvement in 
efficiency at TSL 5 compared to TSL 4. For front-loading standard-size 
RCWs, DOE's expected design path for TSL 5 (which represents EL 4 for 
this product class) incorporates the use of the most efficient 
available direct drive motor, the implementation of advanced sensors, 
and the fastest achievable spin speeds. In particular, the more 
efficient motor, faster spin

[[Page 13610]]

speeds, and advanced sensors provide the improvement in efficiency at 
TSL 5 compared to TSL 4. TSL 5 would save an estimated 2.27 quads of 
energy and 2.94 trillion gallons of water, an amount DOE considers 
significant. Under TSL 5, the NPV of consumer benefit would be $7.68 
billion using a discount rate of 7 percent, and $20.77 billion using a 
discount rate of 3 percent.
    The cumulative emissions reductions at TSL 5 are 86.62 Mt of 
CO2, 28.45 thousand tons of SO2, 160.21 thousand 
tons of NOX, 0.18 tons of Hg, 718.26 thousand tons of 
CH4, and 0.71 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 $4.42 billion. The estimated monetary value of the health 
benefits from reduced SO2 and NOX emissions at 
TSL 5 is $2.95 billion using a 7-percent discount rate and $7.22 
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 5 is $15.05 
billion. Using a 3-percent discount rate for all benefits and costs, 
the estimated total NPV at TSL 5 is $32.41 billion. The estimated total 
NPV is provided for additional information, however DOE primarily 
relies upon the NPV of consumer benefits when determining whether a 
proposed standard level is economically justified.
    At TSL 5, the average LCC impact is a savings of $219 for semi-
automatic, $157 for top-loading standard-size, $56 for front-loading 
compact, and $55 for front-loading standard-size clothes washers. The 
simple payback period is 0.4 years for semi-automatic, 5.5 years for 
top-loading standard-size, 7.1 years for front-loading compact, and 3.4 
years for front-loading standard-size clothes washers. The fraction of 
consumers experiencing a net LCC cost is 0 percent for semi-automatic, 
23 percent for top-loading standard-size, 29 percent for front-loading 
compact, and 18 percent for front-loading standard-size clothes 
washers. Notably, for the top-loading standard-size product class, 
which represents 73 percent of the market, TSL 5 would increase the 
first cost by $189, in comparison to an installed cost of $706 for 
baseline units. For the front-loading standard-size product class, 
which represents 23 percent of the market, TSL 5 would increase the 
first cost by $70, compared to an installed cost of $1,195 for baseline 
units. At TSL 5, the proposed standard for top-loading ultra-compact 
clothes washers is at the baseline, resulting in no LCC impact, no 
simple PBP, and no consumers experiencing a net LCC cost.
    At TSL 5, the projected change in INPV ranges from a decrease of 
$939.6 million to a decrease of $752.4 million, which correspond to a 
decrease of 54.1 percent and 43.3 percent, respectively. The loss in 
INPV is largely driven by industry conversion costs as manufacturers 
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 $1,253.8 million at this TSL.
    Conversion costs at max-tech are significant, as nearly all 
existing RCW models would need to be redesigned to meet the required 
efficiencies. Currently, approximately 3 percent of RCW annual 
shipments meet the max-tech levels. For top-loading standard-size 
clothes washers, which account for 73 percent of annual shipments, less 
than 1 percent of current shipments meet this level. Of the nine OEMs 
offering top-loading standard-size products, one OEM offers models that 
meet the efficiencies required by TSL 5. The remaining eight OEMs would 
need to overhaul their existing platforms and make significant updates 
to their production facilities. Those manufacturers may need to 
incorporate increased tub capacities, wash plate designs, direct drive 
motors, reinforced wash baskets, robust suspension and balancing 
systems, and advanced sensors. These product changes require 
significant investment. In interviews, several manufacturers expressed 
concerns about their ability to meet existing market demand given the 
required scale of investment, redesign effort, and 3-year compliance 
timeline.
    Based upon the above considerations, the Secretary tentatively 
concludes that at TSL 5 for RCWs, the benefits of energy and water 
savings, positive NPV of consumer benefits, and emission reductions 
would be outweighed by the impacts on manufacturers, including the 
large potential reduction in INPV. DOE estimated the potential loss in 
INPV to be as high as 54 percent. The potential losses in INPV are 
primarily driven by large conversion costs that must be made ahead of 
the compliance date. At max-tech, manufacturers would need to make 
significant upfront investments to update nearly all product lines and 
manufacturing facilities. Manufacturers expressed concern that they 
would not be able to complete product and production line updates 
within the 3-year conversion period. Additionally, when considering the 
estimated monetary value of emissions reductions--representing $4.42 
billion in climate benefits (associated with the average SC-GHG at a 3-
percent discount rate), and $7.22 billion (using a 3-percent discount 
rate) or $2.95 billion (using a 7-percent discount rate) in health 
benefits--DOE maintains its tentative conclusion that the overall 
benefits would be outweighed by the impacts on manufacturers. 
Consequently, the Secretary has tentatively concluded that TSL 5 is not 
economically justified.
    DOE then considered TSL 4, which represents the ENERGY STAR Most 
Efficient level for the front-loading product classes, the CEE Tier 1 
level for the top-loading standard-size product class, and a gap fill 
level for the semi-automatic product classes. Specifically, for top-
loading standard-size RCWs, DOE's expected design path for TSL 4 (which 
represents EL 3 for this product class) incorporates many of the same 
technologies and design strategies as described for TSL 5. At TSL 4, 
top-loading standard-size units would incorporate a stainless-steel 
basket, a direct drive motor, and a wash plate, consistent with TSL 5. 
Models at TSL 4 would also incorporate reduced hot wash water 
temperatures compared to temperatures available at the baseline through 
TSL 3 levels, increased tub size compared to the baseline (although not 
as large as TSL 5), and faster spin speeds compared to the baseline 
(although not as fast as TSL 5). In particular, the faster spin speeds, 
reduced hot wash temperatures, and use of a wash plate provide the 
improvement in efficiency at TSL 4 compared to TSL 3. For front-loading 
standard-size RCWs, DOE's expected design path for TSL 4 (which 
represents EL 3 for this product class) incorporates the use of the 
most efficient direct drive motor available and spin speeds that are 
faster than the baseline level but not as fast as at TSL 5. In 
particular, more efficient motor and faster spin speeds provide the 
improvement in efficiency at TSL 4 compared to TSL 3. TSL 4 would save 
an estimated 1.45 quads of energy and 2.53 trillion gallons of water, 
an amount DOE considers significant. Under TSL 4, the NPV of consumer 
benefit would be $5.14 billion using a discount rate of 7 percent, and 
$14.52 billion using a discount rate of 3 percent.
    The cumulative emissions reductions at TSL 4 are 53.21 Mt of 
CO2, 19.93 thousand tons of SO2, 92.39 thousand 
tons of NOX, 0.13 tons of Hg, 411.41 thousand tons of 
CH4, and 0.48 thousand tons of N2O. The estimated

[[Page 13611]]

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 $2.71 billion. The estimated monetary value of the health 
benefits from reduced SO2 and NOX emissions at 
TSL 4 is $1.91 billion using a 7-percent discount rate and $4.57 
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 4 is $9.77 
billion. Using a 3-percent discount rate for all benefits and costs, 
the estimated total NPV at TSL 4 is $21.80 billion. The estimated total 
NPV is provided for additional information, however DOE primarily 
relies upon the NPV of consumer benefits when determining whether a 
proposed standard level is economically justified.
    At TSL 4, the average LCC impact is a savings of $329 for semi-
automatic, $134 for top-loading standard-size, $7 for front-loading 
compact, and $19 for front-loading standard-size clothes washers. The 
simple payback period is 0.3 years for semi-automatic, 5.9 years for 
top-loading standard-size, 9.1 years for front-loading compact, and 3.2 
years for front-loading standard-size clothes washers. The fraction of 
consumers experiencing a net LCC cost is 0 percent for semi-automatic, 
25 percent for top-loading standard-size, 24 percent for front-loading 
compact, and 24 percent for front-loading standard-size clothes 
washers. For the top-loading standard-size product class, TSL 4 would 
increase the first cost by $185, in comparison to an installed cost of 
$706 for baseline units. For the front-loading standard-size product 
class, TSL 4 would increase the first cost by $49, compared to an 
installed cost of $1,195 for baseline units. At TSL 4, the proposed 
standard for top-loading ultra-compact clothes washers is at the 
baseline resulting in no LCC impact, no simple PBP, and no consumers 
experiencing a net LCC cost. Overall, across all product classes, 
around 24 percent of consumers would experience a net LCC cost at TSL 
4. DOE estimated that about 14 percent of low-income households would 
experience a net LCC cost at TSL 4, and as a result of smaller 
households and lower annual usage, about 33 percent of senior-only 
households would experience a net LCC cost at TSL 4.
    At TSL 4, the projected change in INPV ranges from a decrease of 
$530.2 million to a decrease of $361.6 million, which correspond to a 
decrease of 30.5 percent and 20.8 percent, respectively. The loss in 
INPV is largely driven by industry conversion costs as manufacturers 
work to redesign their portfolio of model offerings and update 
production facilities to comply with amended standards at this level. 
Industry conversion costs could reach $690.8 million at this TSL.
    At TSL 4, most top-loading standard-size products would need to be 
redesigned to meet these efficiencies; however, a substantial number of 
front-loading standard-size products are available on the market due to 
manufacturers' participation in the ENERGY STAR Most Efficient program. 
Currently, approximately 14 percent of RCW shipments meet TSL 4 
efficiencies, including nearly 46 percent of standard-size front-
loading shipments. Of the seven OEMs with standard-size front-loading 
products, five OEMs offer 87 basic models (representing approximately 
50 percent of all front-loading standard-size basic models) that meet 
TSL 4 efficiencies. For standard-size top-loading products, 
approximately two percent of shipments meet this level. Of the nine 
OEMs offering top-loading standard-size products, two OEMs offer around 
20 basic models (representing approximately 4 percent of all top-
loading standard-size basic models) that meet the efficiencies required 
by TSL 4. At this level, the remaining seven manufacturers would likely 
implement largely similar design options as at TSL 5, but to a lesser 
extent for the increase in tub size and hardware changes associated 
with faster spin speeds (e.g., reinforced wash baskets, robust 
suspension and balancing systems, and advanced sensors)--which are 
faster than the baseline level but not as fast as TSL 5. In interviews, 
manufacturers indicated that meeting TSL 4 efficiencies would require a 
less extensive redesign than meeting TSL 5 efficiencies.
    At TSL 4, manufacturers expressed concerns--both through written 
comments as well as during confidential manufacturer interviews--
regarding impacts to certain attributes of product performance, 
including wash temperatures, cleaning and rinsing performance, and 
fabric care, particularly for top-loading standard-size RCWs. As 
discussed in section V.B.4.a of this document, DOE recognizes that in 
general, a consumer-acceptable level of cleaning performance (i.e., a 
representative average use cycle) can be easier to achieve through the 
use of higher amounts of energy and water use during the clothes washer 
cycle. Conversely, maintaining acceptable cleaning performance can be 
more difficult as energy and water levels are reduced. Improving one 
aspect of clothes washer performance, such as reducing energy and/or 
water use as a result of energy conservation standards, may require 
manufacturers to make a trade-off with one or more other aspects of 
performance, such as cleaning performance, depending on which 
performance characteristics are prioritized by the manufacturer. DOE 
expects, however, that consumers maintain the same expectations of 
cleaning performance regardless of the efficiency of the clothes 
washer.
    Manufacturers did not provide any quantitative data to support the 
assertion that a standard level at TSL 4 would negatively impact 
product performance. As discussed in section V.B.4.a of this document, 
DOE's analysis of third-party clothes washer performance reviews 
suggests that both top-loading and front-loading RCWs models rated at 
TSL 4 can achieve equal or better overall cleaning performance scores 
than models with lower efficiency ratings. DOE also conducted its own 
performance testing on a representative sample of top-loading standard-
size and front-loading standard-size RCWs, the results of which suggest 
that TSL 4 can be achieved with key performance attributes (e.g., wash 
temperatures, stain removal, mechanical action, and cycle duration) 
that are largely comparable to the performance of lower-efficiency 
units available on the market today. In particular, DOE tentatively 
concludes that the proposed standard level at TSL 4: (1) would not 
require any substantive reduction in hot water temperature on the 
hottest temperature selection in the Normal cycle, and would not 
preclude the ability to provide wash temperatures above the 85 [deg]F 
threshold at which fatty soils are soluble; (2) would be able to 
maintain total cleaning score of at least 90, the market-representative 
threshold as measured on the Hot temperature selection with the large 
load size; furthermore, by prioritizing hardware design options over 
reduced wash temperatures, the proposed standard level would not 
preclude the ability to provide total cleaning scores for top-loading 
units equally as high as the highest scores currently achieved by units 
at lower efficiency levels; (3) would not preclude the ability to 
provide mechanical action scores comparable to the scores for units at 
lower efficiency levels; and (4) would not result in an increase in 
average cycle

[[Page 13612]]

time as measured by the appendix J test procedure.
    In summary, based on DOE's testing of models that currently meet 
the proposed standards, DOE does not expect performance to be 
compromised at the proposed standard level. Furthermore, products are 
readily available on the market at each efficiency level analyzed in 
the NOPR, including TSL 4, indicating a certain degree of market 
acceptance at each efficiency level.
    DOE requests data and information regarding any quantitative 
performance-related characteristics at TSL 4 in comparison to 
performance at the current baseline level (e.g., cleaning performance, 
rinsing performance, fabric wear, etc.), particularly for top-loading 
standard-size RCWs.
    As discussed, DOE's clothes washer test procedure does not 
prescribe a method for testing clothes washer cleaning performance or 
other relevant attributes of RCW performance. DOE, in partnership with 
EPA, has developed the ENERGY STAR Test Method for Determining 
Residential Clothes Washer Cleaning Performance \133\ to determine 
cleaning performance for clothes washers that meet the ENERGY STAR Most 
Efficient criteria. Cleaning performance is determined on the same test 
units immediately following the energy and water consumption tests for 
ENERGY STAR qualification. Notably, however, this test method is 
designed to be performed in conjunction with DOE's appendix J2 test 
procedure--whereas the amended standards proposed by this NOPR would be 
based on testing conducted to the appendix J test procedure. Appendix J 
specifies different load sizes than appendix J2, among other changes, 
which can significantly affect any measurement of cleaning performance. 
Additional investigation would be required to develop a cleaning 
performance test procedure designed to be conducted in conjunction with 
appendix J.
---------------------------------------------------------------------------

    \133\ ENERGY STAR test method available at www.energystar.gov/sites/default/files/asset/document/Test%20Method%20for%20Determining%20Residential%20Clothes%20Washer%20Cleaning%20Performance%20-%20July%202018_0.pdf.
---------------------------------------------------------------------------

    After considering the analysis and weighing the benefits and 
burdens, the Secretary has tentatively concluded that at a standard set 
at TSL 4 for RCWs would be economically justified. At this TSL, the 
weighted average LCC savings for all product classes is $107. An 
estimated 25 percent of top-loading standard-size clothes washer 
consumers and an estimated 24 percent of front-loading (compact and 
standard-size) clothes washer consumers would experience a net cost. 
DOE acknowledges the larger impact on senior-only households as a 
result of smaller households and lower average annual use, but notes 
that the average LCC savings are still positive. The FFC national 
energy and water 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, considering low-income and 
senior-only subgroups as well, vastly outweigh the cost to 
manufacturers. At TSL 4, the NPV of consumer benefits, even measured at 
the more conservative discount rate of 7 percent is over 27 times 
higher than the maximum estimated manufacturers' loss in INPV. The 
standard levels at TSL 4 are economically justified even without 
weighing the estimated monetary value of emissions reductions. When 
those emissions reductions are included--representing $2.71 billion in 
climate benefits (associated with the average SC-GHG at a 3-percent 
discount rate), and $4.57 billion (using a 3-percent discount rate) or 
$1.91 billion (using a 7-percent discount rate) in health benefits--the 
rationale becomes stronger still.
    Therefore, based on the above considerations, DOE proposes to adopt 
the energy conservation standards for RCWs at TSL 4. The proposed 
amended energy conservation standards for RCWs, which are expressed in 
EER and WER, are shown in Table V.38.

     Table V.38--Proposed Amended Energy Conservation Standards for
                       Residential Clothes Washers
------------------------------------------------------------------------
                                      Minimum energy     Minimum water
           Product class             efficiency ratio   efficiency ratio
                                      (lb/kWh/cycle)     (lb/gal/cycle)
------------------------------------------------------------------------
Semi-Automatic Clothes Washers....               2.12               0.27
Automatic Clothes Washers:
    Top-Loading, Ultra-Compact                   3.79               0.29
     (less than 1.6 ft\3\
     capacity)....................
    Top-Loading, Standard-Size                   4.78               0.63
     (1.6 ft\3\ or greater
     capacity)....................
    Front-Loading, Compact (less                 5.02               0.71
     than 3.0 ft\3\ capacity).....
    Front-Loading, Standard-Size                 5.73               0.77
     (3.0 ft\3\ or greater
     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 economic value (expressed in 2021$) of the 
benefits from operating products that meet the proposed standards 
(consisting primarily of operating cost savings from using less energy, 
minus increases in product purchase costs, and (2) the annualized 
monetary value of the climate and health benefits from emission 
reductions.
    Table V.39 shows the annualized values for RCWs under TSL 4, 
expressed in 2021$. The 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 RCWs is $800.8 million per year in increased 
equipment costs, while the estimated annual benefits are $1,344.2 
million from reduced equipment operating costs, $155.7 million from GHG 
reductions, and $202.0 million from reduced NOX and 
SO2 emissions. In this case, the net benefit amounts to 
$901.1 million per year.
    Using a 3-percent discount rate for all benefits and costs, the 
estimated cost of the proposed standards for RCWs is $764.0 million per 
year in increased equipment costs, while the estimated annual benefits 
are $1,598.0 million from reduced equipment operating costs, $155.7 
million from GHG reductions, and $262.2 million from reduced 
NOX and SO2 emissions. In this case, the net 
benefit amounts to $1,251.8 million per year.

[[Page 13613]]



   Table V.39--Annualized Benefits and Costs of Proposed Energy Conservation Standards for Residential Clothes
                                                     Washers
                                                     [TSL 4]
----------------------------------------------------------------------------------------------------------------
                                                                            Million 2021$/year
                                                         -------------------------------------------------------
                                                              Primary      Low-net-benefits    High-net-benefits
                                                             estimate          estimate            estimate
----------------------------------------------------------------------------------------------------------------
                                                3% discount rate
----------------------------------------------------------------------------------------------------------------
Consumer Operating Cost Savings.........................         1,598.0             1,544.5             1,657.8
Climate Benefits *......................................           155.7               151.7               159.7
Health Benefits **......................................           262.2               255.8               268.9
                                                         -------------------------------------------------------
    Total Benefits [dagger].............................         2,015.9             1,952.0             2,086.4
Consumer Incremental Product Costs [Dagger].............           764.0               778.7               695.5
                                                         -------------------------------------------------------
    Net Benefits........................................         1,251.8             1,173.4             1,390.9
----------------------------------------------------------------------------------------------------------------
                                                7% discount rate
----------------------------------------------------------------------------------------------------------------
Consumer Operating Cost Savings.........................         1,344.2             1,302.8             1,389.7
Climate Benefits * (3% discount rate)...................           155.7               151.7               159.7
Health Benefits **......................................           202.0               197.5               206.7
                                                         -------------------------------------------------------
    Total Benefits [dagger].............................         1,701.9             1,652.0             1,756.1
Consumer Incremental Product Costs [Dagger].............           800.8               813.3               737.9
                                                         -------------------------------------------------------
    Net Benefits........................................           901.1               838.7             1,018.3
----------------------------------------------------------------------------------------------------------------
Note: This table presents the costs and benefits associated with RCWs shipped in 2027-2056. These results
  include benefits to consumers which accrue after 2056 from the products shipped in 2027-2056. The Primary, Low
  Net Benefits, and High Net Benefits Estimates utilize projections of energy prices from the AEO2022 Reference
  case, Low Economic Growth case, and High Economic Growth case, respectively. In addition, incremental
  equipment costs reflect a medium decline rate in the Primary Estimate, a low decline rate in the Low Net
  Benefits Estimate, and a high decline rate in the High Net Benefits Estimate. The methods used to derive
  projected price trends are explained in sections IV.F.1 and IV.H.3 of this document. Note that the Benefits
  and Costs may not sum to the Net Benefits due to rounding.
* 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
  sets of 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
  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. See section IV.L of this document for more details.
[dagger] Total benefits include 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.
[Dagger] Costs include incremental equipment costs as well as installation costs.

D. Reporting, Certification, and Sampling Plan

    Manufacturers, including importers, must use product-specific 
certification templates to certify compliance to DOE. For RCWs, the 
certification template reflects the general certification requirements 
specified at 10 CFR 429.12 and the product-specific requirements 
specified at 10 CFR 429.20.
    Ameren et al. encouraged DOE to require manufacturers to report 
average cycle time in the CCD. (Ameren et al., No. 42 at pp. 10-12) 
Ameren et al. commented that reporting average cycle time increases 
stakeholder and consumer access to cycle time, which Ameren et al. 
identify as an important RCW performance attribute. (Id.) Ameren et al. 
commented that cycle time information is important for some consumers, 
particularly for RCW consumers who routinely wash serial loads. (Id.) 
Ameren et al. added that making cycle time widely available enables 
stakeholders to better evaluate the cycle time of a given clothes 
washer relative to its performance level, which could be even more 
important with possible increases to standards that may drive increases 
in spin times to decrease drying energy. (Id.) Ameren et al. also 
commented that reporting RCW cycle time increases the transparency of 
the energy efficiency metrics since reporting additional information on 
cycle time helps improve the transparency of how the energy efficiency 
metric is derived for a given clothes washer. (Id.) Ameren et al. added 
that this is especially important considering the wide variation in the 
cycle time of top- and front-loading RCWs. (Id.) Ameren et al. further 
commented that reporting RCW cycle time enables continuous improvement 
of the test procedure and energy conservation standard over time. (Id.) 
Ameren et al. specified that having access to additional data on cycle 
time enables DOE and other stakeholder groups to consider more 
effectively the value of cycle time measurement as a performance 
feature in future rulemakings. (Id.) Ameren et al. presented data from 
NEEA that plotted cycle time versus rated IMEF of 18 top-loading and 
front-loading RCWs. (Id.) Ameren et al. found that cycle time varies 
widely across front-loading and top-loading standard-size product

[[Page 13614]]

classes. (Id.) Ameren et al. added that according to NEEA's testing 
\134\ some RCWs with identical IMEF ratings can have cycle times that 
are twice as long as other models. (Id.) Ameren et al. therefore 
concluded that these cycle times will also vary in laboratory testing 
(with the appendix J2 textiles) and that this variation represents 
real-world cycle time differences. (Id.)
---------------------------------------------------------------------------

    \134\ NEEA's testing was conducted using an 8.45 lb load of AHAM 
cotton textiles, using the Normal Cycle on Warm Wash/Cold Rinse with 
default spin settings. Ameren et al. noted that NEEA's analysis 
confirms that the cycle times of cycles run with appendix J2 
textiles and AHAM cotton textiles are nearly identical.
---------------------------------------------------------------------------

    The CA IOUs recommended that DOE consider disclosing other 
configurations such as stacked clothes washers and clothes dryers in 
the CCD. (CA IOUs, No. 43 at p. 6) The CA IOUs commented that there are 
several clothes washer configurations available on the market which 
might offer unique functionality to some consumers while not warranting 
a separate product class. (Id.) For example, the CA IOUs listed 
combination all-in-one washer-dryers, pedestal type clothes washers, 
laundry centers,\135\ and double clothes washer products,\136\ and 
stated that all represent unique product configurations that are not 
differentiated in the CCD. (Id.) The CA IOUs commented that, while 
these configurations are clear and intuitive to consumers and 
retailers, the public does not have access to a reliable database 
denoting these unique product characterizations. (Id.) The CA IOUs 
commented that considering the increasing market share and marketing of 
these products, they encourage DOE to consider the disclosure of these 
product configurations into certification requirements and adding those 
attributes to the CCD. (Id.)
---------------------------------------------------------------------------

    \135\ A laundry center is a single tall unit which contains both 
a clothes washer and a clothes dryer.
    \136\ The CA IOUs reference products with two integrated clothes 
washer drums, such as the Samsung FlexWash^TM as ``double 
clothes washers.''
---------------------------------------------------------------------------

    In response to Ameren et al. and the CA IOUs, the values for which 
DOE currently requires reporting for RCWs are product characteristics 
that are required in order for DOE to determine whether the product is 
in compliance with the applicable standards. For example, currently 
reported values include characteristics that determine product class 
(e.g., loading axis, capacity), measured characteristics on which a 
standard depends (e.g., IMEF, EER), and characteristics necessary for 
enforcement of standards (e.g., RMC).
    At this time, DOE tentatively concludes that cycle time and product 
configuration (as recommend by commenters) are not required to 
determine compliance with the applicable standard. In this NOPR, DOE is 
not proposing to amend the product-specific certification requirements 
for RCWs. DOE would consider any amendments to the reported values for 
RCWs in a separate rulemaking.

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'') in the OMB 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 OIRA for review. OIRA has 
determined that this proposed regulatory action constitutes a 
``significant regulatory action within the scope of section 3(f)(1)'' 
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 
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 (www.energy.gov/gc/office-general-counsel). DOE has 
prepared the following IRFA for the products that are the subject of 
this proposed rulemaking.
    For manufacturers of RCWs, 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 proposed 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 
RCWs is classified under NAICS 335220, ``Major Household Appliance 
Manufacturing.'' The SBA sets a threshold of 1,500 employees or fewer

[[Page 13615]]

for an entity to be considered as a small business for this category.
1. Description of Reasons Why Action Is Being Considered
    DOE is proposing amended energy conservation standards for RCWs. 
EPCA prescribed energy conservation standards for these products (42 
U.S.C. 6295(g)(2) and (9)(A)), and directs DOE to conduct future 
rulemakings to determine whether to amend these standards. (42 U.S.C. 
6295(g)(4) and (9)(B)) 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)) This proposed 
rulemaking is in accordance with DOE's obligations under EPCA.
2. Objectives of, and Legal Basis for, Rule
    EPCA authorizes DOE to regulate the energy efficiency of a number 
of consumer products and certain industrial equipment. Title III, Part 
B of EPCA sets forth a variety of provisions designed to improve energy 
efficiency and established the Energy Conservation Program for Consumer 
Products Other Than Automobiles. These products include RCWs, the 
subject of this document. (42 U.S.C. 6292(a)(7)) EPCA prescribed energy 
conservation standards for these products (42 U.S.C. 6295(g)(2) and 
(9)(A)), and directs DOE to conduct future rulemakings to determine 
whether to amend these standards. (42 U.S.C. 6295(g)(4) and (9)(B)) 
This proposed rulemaking is in accordance the 6-year review required 
under 42 U.S.C. 6295(m)(1).
3. Description on Estimated Number of Small Entities Regulated
    DOE reviewed this proposed rule under the provisions of the 
Regulatory Flexibility Act and the procedures and policies published on 
February 19, 2003. 68 FR 7990. DOE conducted a market survey to 
identify potential small manufacturers of RCWs. DOE began its 
assessment by reviewing DOE's CCD,\137\ California Energy Commission's 
Modernized Appliance Efficiency Database System (``MAEDbS''),\138\ 
ENERGY STAR's Product Finder data set,\139\ individual company 
websites, and prior RCW rulemakings to identify manufacturers of the 
covered product. DOE then consulted publicly available data, such as 
manufacturer websites, manufacturer specifications and product 
literature, import/export logs (e.g., bills of lading from Panjiva 
\140\), and basic model numbers, to identify OEMs of RCWs. DOE further 
relied on public data and subscription-based market research tools 
(e.g., Dun & Bradstreet reports \141\) to determine company location, 
headcount, and annual revenue. DOE also asked industry representatives 
if they were aware of any small manufacturers during manufacturer 
interviews. DOE screened out companies that do not offer products 
covered by this rulemaking, do not meet the SBA's definition of a 
``small business,'' or are foreign-owned and operated.
---------------------------------------------------------------------------

    \137\ U.S. Department of Energy's Compliance Certification 
Database is available at: www.regulations.doe.gov/certification-data/#q=Product_Group_s%3A* (Last accessed March 25, 2022).
    \138\ California Energy Commission's Modernized Appliance 
Efficiency Database System is available at: 
cacertappliances.energy.ca.gov/Pages/ApplianceSearch.aspx (Last 
accessed March 25, 2022).
    \139\ U.S. Environmental Protection Agency's ENERGY STAR Product 
Finder is available at: www.energystar.gov/productfinder/ (Last 
accessed March 25, 2022).
    \140\ S&P Global. Panjiva Market Intelligence is available at: 
panjiva.com/import-export/United-States (Last accessed May 5, 2022).
    \141\ D&B Hoovers[bond]Company Information[bond]Industry 
Information[bond]Lists, app.dnbhoovers.com/ (Last accessed August 1, 
2022).
---------------------------------------------------------------------------

    DOE initially identified 19 OEMs that sell RCWs in the United 
States. Of the 19 OEMs identified, DOE tentatively determined that one 
company qualifies as a small business and is not foreign-owned and 
operated.
    DOE reached out to the small business and invited them to 
participate in a voluntary interview. The small business did not 
respond to DOE's interview request. DOE also requested information 
about small businesses and potential impacts on small businesses while 
interviewing large manufacturers.
4. Description and Estimate of Compliance Requirements Including 
Differences in Cost, if Any, for Different Groups of Small Entities
    The one small business identified manufactures one standard-size 
top-loading clothes washer for residential use. DOE did not identify 
any RCW models manufactured by this small business listed in the CCD, 
MAEDbS, or ENERGY STAR databases. Instead, DOE identified this 
manufacturer through the prior rulemaking analysis. 77 FR 32307. There 
is limited public information about the energy and water efficiency of 
this small business's RCW model. Based on a review of available product 
literature and test data of a comparable RCW model, DOE estimates that 
their current design would not meet the efficiencies required at TSL 4. 
Furthermore, DOE's review of the product suggests that the design could 
not be easily adapted to meet TSL 4 efficiencies. DOE expects that the 
small manufacturer would likely need to make significant investments to 
redesign the product to meet the proposed efficiencies. Therefore, DOE 
is unable to conclude that the proposed rule would not have a 
``significant impact on a substantial number of small entities'' at 
this time.
    DOE seeks comments, information, and data on the number of small 
businesses in the industry, the names of those small businesses, and 
their market shares by product class. DOE also requests comment on the 
potential impacts of the proposed standard on small manufacturers. In 
particular, DOE seeks comment on the efficiency performance of the 
small manufacturer's RCW model and the estimated cost to redesign to 
the proposed standard level.
5. Duplication, Overlap, and Conflict With Other Rules and Regulations
    DOE is not aware of any rules or regulations that duplicate, 
overlap, or conflict with the proposed rule.
6. Significant Alternatives to the Rule
    The discussion in the previous section analyzes impacts on small 
businesses that would result from DOE's proposed rule, represented by 
TSL 4. In reviewing alternatives to the proposed rule, DOE examined 
energy conservation standards set at lower efficiency levels. While TSL 
1, TSL 2, and TSL 3 would likely reduce the impacts on the one small 
business manufacturer, it would come at the expense of a reduction in 
energy savings. TSL 1 achieves 58 percent and TSL 2 achieves 57 percent 
lower energy savings compared to the energy savings at TSL 4. TSL 3 
achieves 49 percent lower energy savings compared to the energy savings 
at TSL 4. Additionally, TSL 1 and TSL 2 achieve 50 percent and TSL 3 
achieves 18 percent lower water savings compared to the water savings 
at TSL 4. TSL 5 were also analyzed, but it was determined this level 
would lead to greater costs to manufacturers.
    Based on the presented discussion, establishing standards at TSL 4 
balances the benefits of the energy and water savings at TSL 4 with the 
potential burdens placed on RCW manufacturers, including small business 
manufacturers. Accordingly, DOE does not propose one

[[Page 13616]]

of the other TSLs considered in the analysis, or the other policy 
alternatives examined as part of the regulatory impact analysis and 
included in chapter 17 of the NOPR TSD.
    Additional compliance flexibilities may be available through other 
means. EPCA provides that a manufacturer whose annual gross revenue 
from all of its operations does not exceed $8 million may apply for an 
exemption from all or part of an energy conservation standard for a 
period not longer than 24 months after the effective date of a final 
rule establishing the standard. (42 U.S.C. 6295(t)) Additionally, 
manufacturers subject to DOE's energy efficiency standards may apply to 
DOE's Office of Hearings and Appeals for exception relief under certain 
circumstances. Manufacturers should refer to 10 CFR part 430, subpart 
E, and 10 CFR part 1003 for additional details.

C. Review Under the Paperwork Reduction Act

    Under the procedures established by the Paperwork Reduction Act of 
1995 (``PRA''), a person is not required to respond to a collection of 
information by a Federal agency unless that collection of information 
displays a currently valid OMB Control Number.
    OMB Control Number 1910-1400, Compliance Statement Energy/Water 
Conservation Standards for Appliances, is currently valid and assigned 
to the certification reporting requirements applicable to covered 
equipment, including RCWs.
    DOE's certification and compliance activities ensure accurate and 
comprehensive information about the energy and water use 
characteristics of covered products and covered equipment sold in the 
United States. Manufacturers of all covered products and covered 
equipment must submit a certification report before a basic model is 
distributed in commerce, annually thereafter, and if the basic model is 
redesigned in such a manner to increase the consumption or decrease the 
efficiency of the basic model such that the certified rating is no 
longer supported by the test data. Additionally, manufacturers must 
report when production of a basic model has ceased and is no longer 
offered for sale as part of the next annual certification report 
following such cessation. DOE requires the manufacturer of any covered 
product or covered equipment to establish, maintain, and retain the 
records of certification reports, of the underlying test data for all 
certification testing, and of any other testing conducted to satisfy 
the requirements of part 429, part 430, and/or part 431. Certification 
reports provide DOE and consumers with comprehensive, up-to date 
efficiency information and support effective enforcement.
    Revised certification data would be required for RCWs were this 
NOPR to be finalized as proposed; however, DOE is not proposing amended 
certification or reporting requirements for RCWs in this NOPR. Instead, 
DOE may consider proposals to establish certification requirements and 
reporting for RCWs under a separate rulemaking regarding appliance and 
equipment certification. DOE will address changes to OMB Control Number 
1910-1400 at that time, as necessary.
    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 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

[[Page 13617]]

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 www.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 RCW 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 
RCWs, 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 RCWs 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 proposed 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 RCWs, 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.

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

[[Page 13618]]

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.\142\ 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. 
Because available data, models, and technological understanding have 
changed since 2007, DOE has engaged with the NAS to review DOE's 
analytical methodologies to ascertain whether modifications are needed 
to improve the Department's analyses. DOE is in the process of 
evaluating the resulting report.\143\
---------------------------------------------------------------------------

    \142\ 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 June 12, 2022).
    \143\ The report is available at www.nationalacademies.org/our-work/review-of-methods-for-setting-building-and-equipment-performance-standards.
---------------------------------------------------------------------------

VII. Public Participation

A. Participation in the Webinar

    The time and date of the webinar meeting 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 at www1.eere.energy.gov/buildings/appliance_standards/standards.aspx?productid=68. 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 an interest in the topics addressed in this 
document, or who is representative of a group or class of persons that 
has an interest in these issues, may request an opportunity to make an 
oral presentation at the webinar. Such persons may submit to 
[email protected]. Persons who wish to speak 
should include with their request a computer file in WordPerfect, 
Microsoft Word, PDF, or text (ASCII) file format that briefly describes 
the nature of their interest in this rulemaking and the topics they 
wish to discuss. Such persons should also provide a daytime telephone 
number where they can be reached.
    DOE requests persons selected to make an oral presentation to 
submit an advance copy of their statements at least two weeks before 
the webinar. At its discretion, DOE may permit persons who cannot 
supply an advance copy of their statement to participate, if those 
persons have made advance alternative arrangements with the Building 
Technologies Office. As necessary, requests to give an oral 
presentation should ask for such alternative arrangements.

C. Conduct of the Webinar

    DOE will designate a DOE official to preside at the webinar/public 
meeting and may also use a professional facilitator to aid discussion. 
The meeting will not be a judicial or evidentiary-type public hearing, 
but DOE will conduct it in accordance with section 336 of EPCA. (42 
U.S.C. 6306) A court reporter will be present to record the proceedings 
and prepare a transcript. DOE reserves the right to schedule the order 
of presentations and to establish the procedures governing the conduct 
of the 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 and until the end 
of the comment period, interested parties may submit further comments 
on the proceedings, as well as on any aspect of the proposed 
rulemaking.
    The webinar will be conducted in an informal, conference style. DOE 
will present a general overview of the topics addressed in this 
proposed rulemaking, allow time for prepared general statements by 
participants, and encourage all interested parties to share their views 
on issues affecting this proposed 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 proposed 
rulemaking. The official conducting the webinar/public meeting will 
accept additional comments or questions from those attending, as time 
permits. The presiding official will announce any further procedural 
rules or modification of the previous procedures that may be needed for 
the proper conduct of the webinar.
    A transcript of the webinar 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

[[Page 13619]]

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 
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, hand delivery/courier, or postal 
mail. Comments and documents submitted via email, hand delivery/
courier, or postal mail 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. If you submit via postal mail 
or hand delivery/courier, please provide all items on a CD, if 
feasible, in which case it is not necessary to submit printed copies. 
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 product class structure analyzed in 
this NOPR.
    (2) DOE seeks comment on the technology options not identified in 
this NOPR that manufacturers may use to attain higher efficiency levels 
of RCWs.
    (3) DOE seeks comment on whether any additional technology options 
should be screened out on the basis of any of the screening criteria in 
this NOPR.
    (4) DOE seeks comment on whether the baseline efficiency levels 
analyzed in this NOPR for each product class are appropriate.
    (5) DOE seeks comment on whether the higher efficiency levels 
analyzed in this NOPR for each product class are appropriate.
    (6) DOE seeks comment on whether the efficiency levels analyzed in 
this NOPR for semi-automatic RCWs are appropriate.
    (7) DOE seeks comment on the baseline MPCs and incremental MPCs 
developed for each product class.
    (8) DOE seeks comment on its tentative determination to use the DOE 
dataset as the basis for the translation equations rather than use the 
joint DOE-AHAM dataset.
    (9) DOE seeks comment on its tentative determination not to merge 
the compact and standard-size translations, but to instead develop 
separate translations for each product class.
    (10) DOE seeks comment on whether it should consider defining an 
``unadjusted'' baseline efficiency level based on a translation between 
appendix J2 and appendix J metrics without consideration of any changes 
to spin implementations as a result of adopting the appendix J test 
procedure.
    (11) DOE requests comment and information on the specific 
efficiency levels at which any potential rebound effects may happen, as 
well as the magnitude of the effect.
    (12) DOE requests comment and information on frequency of cleaning 
cycles run per number of cycles used to clean clothes and associated 
data as compared to the recommendations in the manufacturer's use and 
care manuals.
    (13) DOE requests comment and information on RCW lifetime.
    (14) DOE seeks comment on the approach and inputs used to develop 
no-new standards case shipments projection and market share for each 
product class.
    (15) DOE requests data on the market size and typical selling price 
of units sold through the second-hand market for residential clothes 
washers.
    (16) For households who would be negatively impacted by amended 
energy conservation standards, a potential rebate program to reduce the 
total installed costs would be effective in lowering the percentage of 
consumers with a net cost and reducing simple payback period. DOE is 
aware of 80 rebate programs currently available for residential clothes 
washers meeting ENERGY STAR requirements initiated by 63 organizations 
in various States as described in chapter 17 of the NOPR TSD. DOE is 
seeking comment about how amended energy conservation standards may 
impact the low-income and senior-only consumer economics being 
presented and considered in this proposed rulemaking.
    (17) DOE is seeking comment about definable subpopulations in 
addition to low-income and senior-only households and the associated 
data required to differentiate how such subpopulation use clothes 
washers.
    (18) To consider to costs of monitoring test procedure and energy 
conservation standard rulemakings,

[[Page 13620]]

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.
    (19) DOE seeks comment on the availability of direct drive motors 
in quantities required by industry if DOE were to adopt amended 
standards.
    (20) DOE seeks comments, information, and data on the capital 
conversion costs and product conversion costs estimated for each TSL.
    (21) DOE seeks comment on whether manufacturers expect 
manufacturing capacity constraints due to production facility updates 
would limit product availability to consumers in the timeframe of the 
amended standard compliance date (2027).
    (22) DOE requests information regarding the impact of cumulative 
regulatory burden on manufacturers of RCWs associated with multiple DOE 
standards or product-specific regulatory actions of other Federal 
agencies.
    (23) DOE seeks comment on whether the Consumer Reports test 
produces cleaning performance results that are representative of an 
average use cycle as measured by the DOE test procedure. DOE also seeks 
comment on how relative cleaning performance results would vary if 
tested under test conditions consistent with the DOE appendix J test 
procedure.
    (24) DOE requests comment on its use of the Hot temperature 
selection with the large load size to evaluate potential impacts on 
clothes washer performance as a result of amended standards.
    (25) DOE requests comment on its use of the Soil/Stain Removal test 
and Mechanical Action test specified in AHAM HLW-2-2020 as the basis 
for evaluating performance-related concerns expressed by AHAM and 
manufacturers.
    (26) DOE requests comment on its wash temperature data presented in 
the performance characteristics test report and on its tentative 
conclusions derived from this data. DOE requests any additional data 
DOE should consider about wash temperatures at the proposed standard 
level, as DOE's data leads to the tentative conclusion that fatty soils 
would be able to be dissolved at this efficiency level.
    (27) DOE requests comment on its stain removal data presented in 
the performance characteristics test report and on its conclusions 
derived from this data. In particular, DOE requests comment on whether 
the clustering of data at or above a score of 90 (as measured on the 
Hot temperature selection with the large load size) corresponds to a 
market-representative threshold of stain removal performance as 
measured with this cycle configuration. DOE additionally requests 
comment on its analysis indicating that implementing additional 
hardware design options, rather than reducing wash temperatures, on EL 
2 units could enable total cleaning scores at EL 3 that are equally as 
high as the highest scores currently achieved by units at lower 
efficiency levels.
    (28) DOE requests comment on its mechanical action data presented 
in the performance characteristics test report and on its conclusions 
derived from this data. In particular, DOE requests comment on whether 
there is a market-representative threshold of mechanical action 
performance as measured on the Hot temperature selection using the 
large load size. DOE also requests comment on whether better mechanical 
action scores at higher top-loading efficiency levels are attributable 
to the use of wash plates rather than traditional agitators in those 
higher-efficiency units.
    (29) DOE requests comment on its cycle time data presented in the 
performance characteristics test report and on its conclusions derived 
from this data.
    (30) DOE seeks comment on its testing and assessment of performance 
attributes (i.e., wash temperatures, stain removal, mechanical action, 
and cycle duration), particularly at the proposed standard level (i.e., 
TSL 4). In addition, DOE seeks additional data that stakeholders would 
like DOE to consider on performance attributes at TSL 4 efficiencies as 
well as the current minimum energy conservation standards.
    (31) DOE requests comment and information on sales of RCWs with 
deep fill and/or deep rinse options or settings and the frequency of 
use of cycles with these options or settings selected.
    (32) DOE requests data and information regarding any quantitative 
performance-related characteristics at TSL 4 in comparison to 
performance at the current baseline level (e.g., cleaning performance, 
rinsing performance, fabric wear, etc.), particularly for top-loading 
standard-size RCWs.
    (33) DOE seeks comments, information, and data on the number of 
small businesses in the industry, the names of those small businesses, 
and their market shares by product class. DOE also requests comment on 
the potential impacts of the proposed standard on small manufacturers. 
In particular, DOE seeks comment on the efficiency performance of the 
small manufacturer's RCW model and the estimated cost to redesign to 
the proposed standard level.
    Additionally, DOE welcomes comments on other issues relevant to the 
conduct of this 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 and announcement of public meeting.

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 February 9, 
2023, by Francisco Alejandro Moreno, Acting 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 February 21, 2023.

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:


[[Page 13621]]


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

0
2. Amend Sec.  430.32 by:
0
a. Removing paragraphs (g)(1) through
    (3);
0
b. Redesignating paragraph (g)(4) as paragraph (g)(1);
0
c. Revising the introductory sentence of newly redesignated paragraph 
(g)(1); and
0
d. Adding new paragraph (g)(2).
    The addition and revision read as follows:


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

* * * * *
    (g) Clothes washers.
    (1) Clothes washers manufactured on or after January 1, 2018, and 
before [Date 3 years after date of publication of final rule in the 
Federal Register], shall have an Integrated Modified Energy Factor no 
less than, and an Integrated Water Factor no greater than:* * *
    (2) Clothes washers manufactured on or after [Date 3 years after 
date of publication of final rule in the Federal Register], shall have 
an Energy Efficiency Ratio and a Water Efficiency Ratio no less than:

------------------------------------------------------------------------
                                              Energy           Water
                                            efficiency      efficiency
              Product class               ratio (lb/kWh/  ratio (lb/gal/
                                              cycle)          cycle)
------------------------------------------------------------------------
Semi-Automatic Clothes Washers..........            2.12            0.27
Automatic Clothes Washers:
    Top-Loading, Ultra-Compact (less                3.79            0.29
     than 1.6 ft\3\ capacity)...........
    Top-Loading, Standard-Size (1.6                 4.78            0.63
     ft\3\ or greater capacity).........
    Front-Loading, Compact (less than               5.02            0.71
     3.0 ft\3\ capacity)................
    Front-Loading, Standard-Size (3.0               5.73            0.77
     ft\3\ or greater capacity).........
------------------------------------------------------------------------

* * * * *
[FR Doc. 2023-03862 Filed 3-2-23; 8:45 am]
BILLING CODE 6450-01-P

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.