20608 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
DEPARTMENT OF ENERGY 
10 CFR Parts 429 and 430 
[EERE–2014–BT–STD–0059] 
RIN 1904–AD97 
Energy Conservation Program: Energy 
Conservation Standards for Room Air Conditioners 
AGENCY : Office of Energy Efficiency and 
Renewable Energy, Department of Energy. 
ACTION : Notice of proposed rulemaking 
and announcement of a webinar. 
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 room air conditioners. 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 room air conditioners, and also announces a webinar to receive comment on these proposed standards and associated analyses and results. 
DATES : DOE will hold a webinar on 
Tuesday, May 3, 2022, from 12:30 p.m. 
to 4:30 p.m. See section VIII, ‘‘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 June 6, 2022. 
Comments regarding the likely 
competitive impact of the proposed standard should be sent to the Department of Justice contact listed in the 
ADDRESSES section on or before May 
9, 2022. 
ADDRESSES : Interested persons are 
encouraged to submit comments using the Federal eRulemaking Portal at www.regulations.gov. Follow the 
instructions for submitting comments. Alternatively, interested persons may submit comments, identified by docket number EERE–2014–BT–STD–0059, by any of the following methods: 
(1) Federal eRulemaking Portal: 
www.regulations.gov. Follow the instructions 
for submitting comments. 
(2) Email: RoomAC2014STD0059@
ee.doe.gov. Include the docket number 
EERE–2014–BT–STD–0059 in the subject line 
of the message. No telefacsimilies (‘‘faxes’’) will be 
accepted. For detailed instructions on submitting comments and additional information on this process, see section IV of this document. 
Although DOE has routinely accepted 
public comment submissions through a variety of mechanisms, including postal mail and hand delivery/courier, the Department has found it necessary to make temporary modifications to the comment submission process in light of the ongoing Covid–19 pandemic. DOE is currently suspending receipt of public comments via postal mail and hand delivery/courier. If a commenter finds that this change poses an undue hardship, please contact Appliance Standards Program staff at (202) 586– 1445 to discuss the need for alternative arrangements. Once the COVID–19 pandemic health emergency is resolved, DOE anticipates resuming all of its regular options for public comment submission, including postal mail and hand delivery/courier. 
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?D=EERE- 2014-BT-STD-0059. The docket web 
page contains instructions on how to access all documents, including public comments, in the docket. See section VIII of this document for information on how to submit comments through www.regulations.gov. 
Written comments regarding the 
burden-hour estimates or other aspects of the collection-of-information requirements contained in this proposed rule may be submitted to Office of Energy Efficiency and Renewable Energy following the instructions at RegInfo.gov. 
EPCA requires the Attorney General 
to provide DOE a written determination of whether the proposed standard is likely to lessen competition. The U.S. Department of Justice Antitrust Division invites input from market participants and other interested persons with views on the likely competitive impact of the proposed standard. Interested persons may contact the Division at energy.standards@usdoj.gov on or 
before the date specified in the 
DATES  
section. Please indicate in the ‘‘Subject’’ line of your email the title and Docket number of this proposed rulemaking. 
FOR FURTHER INFORMATION CONTACT : 
Mr. Bryan Berringer, U.S. Department 
of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Office, EE–5B, 1000 Independence Avenue SW, Washington, DC 20585–0121. Telephone: (202) 586– 0371. Email: ApplianceStandardsQuestions@ee.doe.gov. 
Ms. Sarah Butler, U.S. Department of 
Energy, Office of the General Counsel, GC–33, 1000 Independence Avenue SW, Washington, DC 20585–0121. Telephone: (202) 586–1777. Email: Sarah.Butler@hq.doe.gov. 
For further information on how to 
submit a comment, review other public comments and the docket, or participate in the webinar, 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 
Room ACs 
C. Deviation From Appendix A 
III. General Discussion 
A. Product Classes and Scope of Coverage B. Test Procedure C. Technological Feasibility 1. General 2. Maximum Technologically Feasible 
Levels 
D. Energy Savings 1. Significance of Savings E. Economic Justification 1. Specific Criteria a. Economic Impact on Manufacturers and 
Consumers 
b. Savings in Operating Costs Compared To 
Increase in Price (LCC and PBP) 
c. Energy Savings d. Lessening of Utility or Performance of 
Products 
e. Impact of Any Lessening of Competition f. Need for National Energy Conservation g. Other Factors 2. Rebuttable Presumption 
IV. Methodology and Discussion of Related 
Comments 
A. Market and Technology Assessment 1. Scope of Coverage and Product Classes 2. Technology Options a. Reduced Evaporator Air Recirculation b. Compressors c. Significant New Alternatives Policy 
(SNAP)-Approved Refrigerants 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00002 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420609 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
1For editorial reasons, upon codification in the 
U.S. Code, Part B was redesignated Part A. 
2All references to EPCA in this document refer 
to the statute as amended through the Infrastructure 
Investment and Jobs Act, Public Law 117–58 (Nov. 15, 2021). B. Screening Analysis 
1. Screened-Out Technologies 2. Remaining Technologies C. Engineering Analysis 1. Efficiency Analysis a. Baseline Efficiency b. Higher Efficiency Levels 2. Cost Analysis 3. Cost-Efficiency Results D. Markups Analysis E. Energy Use Analysis F. Life-Cycle Cost and Payback Period 
Analysis 
1. Product Cost 2. Installation Cost 3. Annual Energy Consumption a. Rebound Effect 4. Energy Prices 
5. Maintenance and Repair Costs 6. Product Lifetime 7. Discount Rates 8. Energy Efficiency Distribution in the No- 
New-Standards Case 
9. Payback Period Analysis G. Shipments Analysis H. National Impact Analysis 1. Product Efficiency Trends 2. National Energy Savings 3. Net Present Value Analysis I. Consumer Subgroup Analysis J. Manufacturer Impact Analysis 1. Overview 2. Government Regulatory Impact Model 
and Key Inputs 
a. Manufacturer Production Costs b. Shipments Projections c. Product and Capital Conversion Costs d. Manufacturer Markup Scenarios 3. Manufacturer Interviews 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 Air Pollutants M. Utility Impact Analysis N. Employment Impact Analysis 
V. Analytical Results and Conclusions 
A. Trial Standard Levels B. Economic Justification and Energy 
Savings 
1. Economic Impacts on Individual 
Consumers a. Life-Cycle Cost and Payback Period 
b. Consumer Subgroup Analysis c. Rebuttable Presumption Payback 2. Economic Impacts on Manufacturers a. Industry Cash Flow Analysis Results b. Direct Impacts on Employment c. Impacts on Manufacturing Capacity d. Impacts on Subgroups of Manufacturers e. Cumulative Regulatory Burden 3. National Impact Analysis a. Significance of Energy Savings b. Net Present Value of Consumer Costs 
and Benefits 
c. Indirect Impacts on Employment 4. Impact on Utility or Performance of 
Products 
5. Impact of Any Lessening of Competition 6. Need of the Nation To Conserve Energy 
7. Other Factors 8. Summary of National Economic Impacts C. Conclusion 1. Benefits and Burdens of TSLs 
Considered for Room AC Standards 
2. Annualized Benefits and Costs of the 
Proposed Standards 
VI. Cooling Capacity Verification VII. Procedural Issues and Regulatory Review 
A. Review Under Executive Orders 12866 
and 13563 
B. Review Under the Regulatory Flexibility 
Act 
C. Review Under the Paperwork Reduction 
Act 
D. Review Under the National 
Environmental Policy Act of 1969 
E. Review Under Executive Order 13132 F. Review Under Executive Order 12988 G. Review Under the Unfunded Mandates 
Reform Act of 1995 
H. Review Under the Treasury and General 
Government Appropriations Act, 1999 
I. Review Under Executive Order 12630 J. Review Under the Treasury and General 
Government Appropriations Act, 2001 
K. Review Under Executive Order 13211 L. Information Quality 
VIII. Public Participation 
A. Attendance at the Webinar B. Procedure for Submitting Prepared 
General Statements for Distribution 
C. Conduct of the Public Meeting D. Submission of Comments E. Issues on Which DOE Seeks Comment 
IX. Approval of the Office of the Secretary I. Synopsis of the Proposed Rule 
Title III, Part B1of EPCA,2established 
the Energy Conservation Program for 
Consumer Products Other Than Automobiles. (42 U.S.C. 6291–6309) These products include room air conditioners (‘‘room ACs’’), 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 room ACs. The proposed standards, which are expressed in the amount of cooling provided per amount of energy consumed, measured in British thermal units per watt-hour (Btu/Wh) are shown in Table I.1. These proposed standards, if adopted, would apply to all room ACs listed in Table I.1 manufactured in, or imported into, the United States starting on the date 3 years after the publication of the final rule for this proposed rulemaking. 
BILLING CODE 6450–01–P 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00003 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420610 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
3The 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). 
A. Benefits and Costs to Consumers 
Table I.2 presents DOE’s evaluation of 
the economic impacts of the proposed 
standards on consumers of room ACs, as measured by the average life-cycle cost (‘‘LCC’’) savings and the simple payback period (‘‘PBP’’).
3The average LCC savings are positive for all product 
classes, and the PBP is less than the average lifetime of a room AC, which is estimated to be 9 years (see section IV.F.6 of this document). 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00004 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.011</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4T bl I 1 P a e . ropose dE neri!V C onserva 10n an ar s or oom f St d d f R Ir on 110ners A" C d"f 
Equipment Class CEER (Btu/Wh) 
1. Without reverse cycle, with louvered sides, and less than 6,000 Btu/h 13.1 
2. Without reverse cycle, with louvered sides and 6,000 to 7,900 Btu/h 13.7 
3. Without reverse cycle, with louvered sides and 8,000 to 13,900 Btu/h 16.0 
4. Without reverse cycle, with louvered sides and 14,000 to 19,900 Btu/h 16.0 
5a. Without reverse cycle, with louvered sides and 20,000 to 27,900 Btu/h 13.8 
5b. Without reverse cycle, with louvered sides and 28,000 Btu/h or more 13.2 
6. Without reverse cycle, without louvered sides, and less than 6,000 Btu/h 12.8 
7. Without reverse cycle, without louvered sides and 6,000 to 7,900 Btu/h 12.8 
8a. Without reverse cycle, without louvered sides and 8,000 to 10,900 Btu/h 14.1 
8b. Without reverse cycle, without louvered sides and 11,000 to 13,900 Btu/h 13.9 
9. Without reverse cycle, without louvered sides and 14,000 to 19,900 Btu/h 13.7 
10. Without reverse cycle, without louvered sides and 20,000 Btu/h or more 13.8 
11. With reverse cycle, with louvered sides, and less than 20,000 Btu/h 14.4 
12. With reverse cycle, without louvered sides, and less than 14,000 Btu/h 13.7 
13. With reverse cycle, with louvered sides, and 20,000 Btu/h or more 13.7 
14. With reverse cycle, without louvered sides, and 14,000 Btu/h or more 12.8 
15. Casement-Only 13.9 
16. Casement-Slider 15.3 20611 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
4All monetary values in this document are 
expressed in 2020 dollars. 
5The quantity refers to full-fuel-cycle (‘‘FFC’’) 
energy savings. FFC energy savings includes the 
energy consumed in extracting, processing, and transporting primary fuels (i.e., coal, natural gas, 
petroleum fuels), and, thus, presents a more complete picture of the impacts of energy efficiency standards. For more information on the FFC metric, 
see section IV.H.2 of this document. 6A metric ton is equivalent to 1.1 short tons. 
Results for emissions other than CO 2are presented 
in short tons. 
7DOE calculated emissions reductions relative to 
the no-new-standards case, which reflects key 
assumptions in the Annual Energy Outlook 2021 (‘‘AEO 2021’’). AEO 2021 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 AEO 2021 assumptions that effect air pollutant 
emissions. 
BILLING CODE 6450–01–C 
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 (2021–2055). Using a real discount rate of 7.2 percent, DOE estimates that the INPV for manufacturers of room ACs in the case 
without amended standards is $1.08 billion in 2020$. Under the proposed standards, the change in INPV is estimated to range from ¥6.0 percent to 7.8 percent, which is approximately ¥$64.5 million to $84.1 million. In order to bring products into compliance with amended standards, DOE estimated that the industry would incur total conversion costs of $22.8 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
4 
DOE’s analyses indicate that the 
proposed energy conservation standards 
for room ACs would save a significant amount of energy. Relative to the case without amended standards, the lifetime energy savings for room ACs purchased in the 30-year period that begins in the anticipated year of compliance with the amended standards (2026–2055) amount to 1.40 quadrillion British thermal units (‘‘Btu’’), or quads.
5This represents a 
savings of 12 percent relative to the energy use of these products in the case without amended standards (referred to as the ‘‘no-new-standards case’’). 
The cumulative net present value 
(‘‘NPV’’) of total consumer benefits of the proposed standards for room ACs are $4.83 billion (at a 7-percent discount rate) and $10.56 billion (at a 3-percent discount rate). This NPV expresses the estimated total value of future operating-cost savings minus the estimated increased product costs for room ACs purchased in 2026–2055. 
In addition, the proposed standards 
for room ACs are projected to yield significant environmental benefits. DOE estimates that the proposed standards would result in cumulative emission reductions (over the same period as for energy savings) of 49.5 million metric tons (‘‘Mt’’)
6of carbon dioxide (‘‘CO 2’’), 
19.1 thousand tons of sulfur dioxide (‘‘SO
2’’), 69.4 thousand tons of nitrogen 
oxides (‘‘NO X’’), 339.3 thousand tons of 
methane (‘‘CH 4’’), 0.5 thousand tons of 
nitrous oxide (‘‘N 2O’’), and 0.1 tons of 
mercury (‘‘Hg’’).7 
DOE estimates the value of climate 
benefits from a reduction in greenhouse gases using four different estimates of the social cost of CO
2(‘‘SC–CO 2’’), the 
social cost of methane (‘‘SC–CH 4’’), and 
the social cost of nitrous oxide (‘‘SC– N
2O’’). Together these represent the 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00005 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.012</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table 1.2 Impacts of Proposed Energy Conservation Standards on Consumers of 
Room Air Conditioners for Representative Product Classes (TSL 3) 
AverageLCC Simple Payback 
Room AC Product Class Savings Period 
(2020$) (vears) 
1. Without reverse cycle, with louvered sides, and less $63.49 0.7 than 6,000 Btu/h 
2. Without reverse cycle, with louvered sides and 6,000 $80.02 0.9 to 7,900 Btu/h 
3. Without reverse cycle, with louvered sides and 8,000 $99.14 2.8 to 13,900 Btu/h 
4. Without reverse cycle, with louvered sides and $97.49 2.9 14,000 to 19,900 Btu/h 
5a. Without reverse cycle, with louvered sides and $152.52 2.6 20,000 Btu/h to 27,900 Btu/h 
5b. Without reverse cycle, with louvered sides and $275.19 2.3 28,000 Btu/h or more 
8a. Without reverse cycle, without louvered sides and $74.28 3.3 8,000 to 10,900 Btu/h 
8b. Without reverse cycle, without louvered sides and $116.89 2.4 11,000 to 13,900 Btu/h 
9. Without reverse cycle, without louvered sides and $162.64 2.8 14,000 to 19,900 Btu/h 
11. With reverse cycle, with louvered sides, and less $131.12 3.2 than 20,000 Btu/h 
12. With reverse cycle, without louvered sides, and less $122.74 2.5 than 14,000 Btu/h 
16. Casement-Slider $81.33 4.0 20612 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
8See Interagency Working Group on Social Cost 
of Greenhouse Gases, Technical Support Document: 
Social Cost of Carbon, Methane, and Nitrous Oxide. Interim Estimates Under Executive Order 13990, Washington, DC, February 2021, available at www.whitehouse.gov/wp-content/uploads/2021/02/ TechnicalSupportDocument_SocialCostofCarbonMethaneNitrousOxide.pdf?source=email. 9DOE estimated the monetized value of NO Xand 
SO 2emissions reductions associated with 
electricity savings using benefit per ton estimates 
from the scientific literature. See section IV.L.2 of this document for further discussion. 
10DOE 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. 
11On 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. In the absence of further intervening court orders, DOE will revert to its approach prior to the injunction and present monetized benefits where appropriate and permissible under law. social cost of greenhouse gases (‘‘SC– 
GHG’’). DOE used interim SC–GHG values developed by an Interagency Working Group on the Social Cost of Greenhouse Gases (‘‘IWG’’).
8The 
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 is $2.39 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 SC–GHG estimates. 
DOE also estimates health benefits 
from SO
2and NO Xemissions reductions.9DOE estimates the present 
value of the health benefits would be 
$1.82 billion using a 7-percent discount rate, and $4.14 billion using a 3-percent discount rate.
10DOE is currently only 
monetizing (for SO 2and NO X) PM 2.5 
precursor health benefits and (for NO X) 
ozone precursor health benefits, but will continue to assess the ability to monetize other effects such as health benefits from reductions in direct PM
2.5 
emissions.11 Table I.3 summarizes the economic 
benefits and costs expected to result 
from the proposed standards for room 
ACs. In the table, total benefits for both the 3-percent and 7-percent cases are presented using the average GHG social costs with 3-percent discount rate. DOE does not have a single central SC–GHG point estimate and it emphasizes the importance and value of considering the benefits calculated using all four SC– GHG estimates. The estimated total net benefits using each of the four SC–GHG estimates are presented in section V.B.8 of this document. 
BILLING CODE 6540–01–P 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00006 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420613 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00007 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.013</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table 1.3 Summary of Monetized Economic Benefits and Costs of Proposed Energy 
Conservation Standards for Room Air Conditioners for TSL 3 
Billion 2020$ 
3% discount rate 
Consumer Operating Cost Savings 13.87 
Climate Benefits* 2.39 
Health Benefits** 4.14 
Total Benefitst 20.41 
Consumer Incremental Product Costst 3.31 
Net Benefits 17.10 
7% discount rate 
Consumer Operating Cost Savings 6.89 
Climate Benefits* 2.39 
Health Benefits** 1.82 
Total Benefitst 11.10 
Consumer Incremental Product Costst 2.05 
Net Benefits 9.05 
Note: This table presents the costs and benefits associated with consumer room ACs shipped in 2026-2055. These 
results include benefits to consumers which accrue after 2055 from the products shipped in 2026-2055. 
*Climate benefits are cakulated using four diITerent estimates of lhe social cost of carbon (SC-CO2), methane (SC­
CH4), and nitrous oxide (SC-N2O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates; 95th 
percentile at 3 percent discount rate), as shown in Table V.50 through Table V.52. Together these represent the global 
social cost of greenhouse gases (SC-GHG). For presentational purposes of this table, the climate benefits associated 
with the average SC-GHG at a 3 percent discount rate are shown, but the Department does not have a single central SC­
GHG point estimate. See section IV.L of this docU111ent for more details. 
** Health benefits are calculated using benefit-per-ton values for NOx and SO2. DOE is currently only monetizing (for 
SO2 and NOx) PM2.s precursor health benefits and (for NOx) ozone precursor health benefits, but will continue to 
assess the ability to monetize other effocts such as health benefits from reductions in direct PMz.s emissions. The 
health benefits are presented at real discount rates of 3 and 7 percent. See section IV.L of this docU111ent for more 
details. t Total and net benefits include consU111er, 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 SC-GHG estimates. See Table V.55 for net benefits using all four SC­
GHG estimates. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22-30087) granted the federal 
government's emergency motion for stay pending appeal of the F ebrumy 11, 2022, preliminary injunction issued in 
Louisiana v. Eiden, 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. In the absence of further intervening court 
orders, DOE will revert to its approach prior to the injunction and present monetized benefits where appropriate and 
permissible under law. 
:j: Costs include incremental equipment costs as well as installation costs. 20614 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
12To 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 benefits and costs of the proposed 
standards, for room ACs sold in 2026– 
2055, can also be expressed in terms of annualized values. The monetary values for the total annualized net benefits are (1) the reduced consumer operating costs, minus (2) the increase in product purchase prices and installation costs, plus (3) the value of the benefits of GHG, NO
X,and SO 2emission 
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 room ACs shipped in 2026–2055. The climate benefits associated with reduced GHG emissions achieved as a result of the proposed standards are also calculated based on the lifetime of room ACs shipped in 2026–2055. 
Estimates of annualized benefits and 
costs of the proposed standards are shown in Table I.4 of this document. 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 SO
2and NO X 
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 $216.9 million per year in increased equipment costs, while the estimated annual benefits are $727.5 million in reduced equipment operating costs, $137.5 million in climate benefits, $192.1 million in health benefits. In this case, the net benefit would amount to $840.2 million per year. 
Using a 3-percent discount rate for all 
benefits and costs, the estimated cost of the proposed standards is $190.1 million per year in increased equipment costs, while the estimated annual benefits are $796.7 million in reduced operating costs, $137.5 million in climate benefits, and $237.9 million in health benefits. In this case, the net benefit would amount to $982.0 million per year. 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00008 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420615 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
BILLING CODE 6450–01–C 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00009 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.014</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table 1.4 Annualized Monetized Benefits and Costs of Proposed Energy Conservation 
Standards for Room Air Conditioners for TSL 3 
Million 2020$/year 
Primary Estimate Low-Net-Benefits High-Net-Benefits 
Estimate Estimate 
3% discount rate 
Consumer Operating Cost Savings 796.7 751.9 847.8 
Climate Benefits* 137.5 134.2 140.4 
Health Benefits** 237.9 232.3 242.7 
Total Benefitst 1,172.0 1,118.4 1,230.9 
Consumer Incremental Product Costst 190.1 213.2 163.1 
Net Benefits 982.0 905.2 1,067.7 
7% discount rate 
Consumer Operating Cost Savings 727.5 693.3 768.4 
Climate Benefits* 137.5 134.2 140.4 
Health Benefits** 192.1 188.1 195.7 
Total Benefitst 1,057.1 1,015.6 1,104.4 
Consumer Incremental Product Costst 216.9 240.0 190.0 
Net Benefits 840.2 775.7 914.5 
Note: This table presents the costs and benefits associated with room A Cs shipped in 2026-2055. These results include benefits 
to consumers which accrue after 2055 from the products shipped in 2026-2055. 
* Climate benefits are calculated using four different estimates of the social cost of carbon (SC-CO2), methane (SC-CIL), and 
nitrous oxide (SC-N2O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates; 95th percentile at 3 percent 
discount rate). Together these represent the global social cost of greenhouse gases (SC-GHG ). For presentational purposes of this 
table, the climate benefits associated with the average SC-GHG at a 3 percent discount rate are shown, but the Department does 
not have a single central SC-GHG point estimate, and it emphasizes the importance and value of considering the benefits 
calculated using all four SC-GHG estimates. See section IV.L of this document for more details. 
** Health benefits are calculated using benefit-per-ton values for NOx and SO2. DOE is currently only monetizing (for SO2 and 
NOx) PMi.s 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 PMi.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. t 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 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. Eiden, 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 eajoined 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. In the absence of further intervening court orders, DOE will revert to its approach prior to the injunction and 
present monetized benefits where appropriate and permissible under law. t Costs include incremental equipment costs as well as installation costs 20616 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
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. Based on the analyses described previously, DOE has tentatively concluded that the benefits of the proposed standards to the Nation (energy savings, positive NPV of consumer benefits, consumer LCC savings, and emission reductions) would outweigh the burdens (loss of INPV for manufacturers and LCC increases for some consumers). 
DOE also considered more-stringent 
energy efficiency levels as potential standards, and is still considering them in this 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 room ACs. 
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 room ACs, the subject of this document. (42 U.S.C. 6292(a)(2)) EPCA prescribed energy conservation standards for these products (42 U.S.C. 6295(c)(1)), and directs DOE to conduct future rulemakings to determine whether to amend these standards. (42 U.S.C. 6295(c)(2)) EPCA further provides that, not later than 6 years after the issuance of any final rule establishing or amending a standard, DOE must publish 
either a notice of determination that standards for the product do not need to be amended, or a NOPR including new proposed energy conservation standards (proceeding to a final rule, as appropriate). (42 U.S.C. 6295(m)(1)) 
The energy conservation program 
under EPCA consists essentially of four parts: (1) Testing, (2) labeling, (3) the establishment of Federal energy conservation standards, and (4) certification and enforcement procedures. Relevant provisions of EPCA specifically include definitions (42 U.S.C. 6291), test procedures (42 U.S.C. 6293), labeling provisions (42 U.S.C. 6294), energy conservation standards (42 U.S.C. 6295), and the authority to require information and reports from manufacturers (42 U.S.C. 6296). 
Federal energy efficiency 
requirements for covered products established under EPCA generally supersede State laws and regulations concerning energy conservation testing, labeling, and standards. (42 U.S.C. 6297(a)–(c)) DOE may, however, grant waivers of Federal preemption for particular State laws or regulations, in accordance with the procedures and other provisions set forth under EPCA. (See 42 U.S.C. 6297(d)) 
Subject to certain criteria and 
conditions, DOE is required to develop test procedures to measure the energy efficiency, energy use, or estimated annual operating cost of each covered product. (42 U.S.C. 6295(o)(3)(A) and 42 U.S.C. 6295(r)) Manufacturers of covered products must use the prescribed DOE test procedure as the basis for certifying to DOE that their products comply with the applicable energy conservation standards adopted under EPCA and when making representations to the public regarding the energy use or efficiency of those products. (42 U.S.C. 6293(c) and 42 U.S.C. 6295(s)) Similarly, DOE must use these test procedures to determine 
whether the products comply with standards adopted pursuant to EPCA. (42 U.S.C. 6295(s)) The DOE test procedures for room ACs appear at title 10 of the Code of Federal Regulations (‘‘CFR’’) part 430, subpart B, appendix F. 
DOE must follow specific statutory 
criteria for prescribing new or amended standards for covered products, including room ACs. 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) 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: (1) For certain products, including room ACs, if no test procedure has been established for the product, or (2) if DOE determines by rule that the standard is not technologically feasible or economically justified. (42 U.S.C. 6295(o)(3)(A)–(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 manufacturers and consumers of the 
products subject to the standard; 
(2) The savings in operating costs 
throughout the estimated average life of the covered products in the type (or class) compared to any increase in the price, initial charges, or maintenance expenses for the covered products that are likely to result from the standard; 
(3) The total projected amount of energy (or 
as applicable, water) savings likely to result directly from the standard; 
(4) Any lessening of the utility or the 
performance of the covered products likely to result from the standard; 
(5) The impact of any lessening of 
competition, as determined in writing by the Attorney General, that is likely to result from the standard; 
(6) The need for national energy and water 
conservation; and 
(7) Other factors the Secretary 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 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00010 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420617 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
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 room ACs address standby mode and off mode energy use. In this rulemaking, DOE intends to incorporate such energy use into any amended energy conservation standards that it may adopt. 
B. Background 1. Current Standards 
In a direct final rule published on 
April 21, 2011 (‘‘April 2011 Direct Final 
Rule’’), DOE prescribed the current energy conservation standards for room ACs. 76 FR 22454. These standards are set forth in DOE’s regulations at 10 CFR 430.32(b) and are repeated in Table II.1 where CEER stands for ‘‘Combined Energy Efficiency Rating.’’ 
2. History of Standards Rulemaking for 
Room ACs 
EPCA prescribed initial energy 
conservation standards for room ACs and further directed DOE to conduct two cycles of rulemakings to determine whether to amend these standards. (42 U.S.C. 6295(c)(1)–(2)) DOE completed 
the first of these rulemaking cycles on September 24, 1997, by adopting amended performance standards for 
room ACs manufactured on or after October 1, 2000. 62 FR 50122. Additionally, DOE completed a second rulemaking cycle to amend the standards for room ACs by issuing the 
April 2011 Direct Final Rule, in which DOE prescribed the current energy conservation standards for room ACs 
manufactured on or after April 21, 2014. 76 FR 22454 (April 21, 2011). DOE subsequently published a final rule amending the compliance date for the 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00011 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.015</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4T bl II 1 F d IE a e . e era ner2V C onservat1on S d d :t R tan ar s or oom Ir on 1t1oners A" C d". 
Minimum 
Room AC Product Class CEER, 
(Btu/Wh) 
1. Without reverse cycle, with louvered sides and less than 6,000 Btu/h 11.0 
2. Without reverse cycle, with louvered sides and 6,000 to 7,999 Btu/h 11.0 
3. Without reverse cycle, with louvered sides and 8,000 to 13,999 Btu/h 10.9 
4. Without reverse cycle, with louvered sides and 14,000 to 19,999 Btu/h 10.7 
5a. Without reverse cycle, with louvered sides and 20,000 Btu/h to 27,999 Btu/h 9.4 
Sb. Without reverse cycle, with louvered sides and 28,000 Btu/h or more 9.0 
6. Without reverse cycle, without louvered sides, and less than 6,000 Btu/h 10.0 
7. Without reverse cycle, without louvered sides and 6,000 to 7,999 Btu/h 10.0 
8a. Without reverse cycle, without louvered sides and 8 000 to 10,999 Btu/h 9.6 
8b. Without reverse cycle, without louvered sides and 11,000 to 13,999 Btu/h 9.5 
9. Without reverse cycle, without louvered sides and 14 000 to 19,999 Btu/h 9.3 
10. Without reverse cycle, without louvered sides and 20 000 Btu/h or more 9.4 
11. With reverse cycle, with louvered sides, and less than 20,000 Btu/h 9.8 
12. With reverse cycle, without louvered sides, and less than 14,000 Btu/h 9.3 
13. With reverse cycle, with louvered sides, and 20,000 Btu/h or more 9.3 
14. With reverse cycle, without louvered sides, and 14,000 Btu/h or more 8.7 
15. Casement-Only 9.5 
16. Casement-Slider 10.4 20618 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
13Pursuant to amendments to appendix A to 10 
CFR part 430, subpart C (‘‘Appendix A’’) DOE 
generally will issue an early assessment request for information announcing that DOE is considering initiating a rulemaking proceeding. Section 6(a)(1) of Appendix A; see also 85 FR 8626, 8637 (Feb. 14, 2020) and 86 FR 70892 (December 13, 2021). Section 6(a)(2) of Appendix A provides that if the DOE 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. Because this proposed rulemaking was already in progress at the time the relevant amendments to the Process Rule were published, DOE did not reinitiate the entire rulemaking process. Additionally, the June 2015 RFI presented the issues, analyses, and processes relevant to consideration of amended standards for room ACs. 
14Comments are available at 
www.regulations.gov/document/EERE-2014-BT- 
STD-0059-0001/comment. 15The parenthetical reference provides a 
reference for information located in the docket of 
DOE’s rulemaking to develop energy conservation standards for room ACs. (Docket No. EERE–2014– BT–STD–0059, which is maintained at www.regulations.gov/docket?D=EERE-2014-BT- STD-0059). The references are arranged as follows: 
(commenter name, comment docket ID number, page of that document). current room AC standards to June 1, 
2014. 76 FR 52852 (Aug. 24, 2011). In a separate notice, also published on August 24, 2011, DOE confirmed the adoption of these energy conservation standards in a notice of effective date and compliance dates for the April 2011 Direct Final Rule. 76 FR 52854. 
As part of the current analysis, on 
June 18, 2015, DOE prepared a Request for Information (‘‘June 2015 RFI’’), which solicited information from the public to help DOE determine whether amended standards for room ACs would result in a significant amount of additional energy savings and whether those standards would be technologically feasible and economically justified.
1380 FR 34843. 
Comments received following the 
publication of the June 2015 RFI helped DOE identify and resolve issues related to the subsequent preliminary analysis.
14DOE published a notice of 
public meeting and availability of the preliminary technical support document (‘‘TSD’’) on June 17, 2020 (‘‘June 2020 Preliminary Analysis’’). 85 FR 36512. DOE subsequently held a public 
meeting on August 5, 2020, to discuss 
and receive comments on the preliminary TSD. The preliminary TSD that presented the methodology and results of the preliminary analysis is available at: www.regulations.gov/ document/EERE-2014-BT-STD-0059- 0013. 
DOE received comments in response 
to the June 2020 Preliminary Analysis 
from the interested parties listed in Table II.2. 
A parenthetical reference at the end of 
a comment quotation or paraphrase 
provides the location of the item in the public record.
15 
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(d)(2) of appendix A specifies that the length of the public comment period for a NOPR will vary depending upon the circumstances of the particular rulemaking, but will not be less than 75 calendar days. For this NOPR, DOE has opted to instead provide a 60-day comment period. As stated, DOE 
requested comment in the June 2015 RFI on the technical and economic analyses 
and provided stakeholders a 76-day comment period. 80 FR 34843, 80 FR 44301. Additionally, DOE provided a 74-day comment period for the June 2020 preliminary analysis. 85 FR 36512, 85 FR 52280. DOE has relied on many of the same analytical assumptions and approaches as used in the preliminary assessment and has determined that a 
60-day comment period, in conjunction 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00012 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.016</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table 11.2 June 2020 Preliminary Analysis Written Comments 
Reference in Organization 
Oreanization( s) this NOPR Type 
Appliance Standards Awareness Project, 
Consumer Federation of America, National Joint Efficiency Consumer Law Center ( on behalf of its low-
income clients), Natural Resources Defense Comm enters Organizations 
Council 
Association of Home Appliance Manufacturers AHAM Trade 
Association 
California Investor-Owned Utilities California IOUs Utilities 
Northwest Energy Efficiency Alliance NEEA Efficiency 
Organization 
Institute for Policy Integrity at NYU School of Social Cost of 
Carbon Law, Montana Environmental Information Comm enters Efficiency 
Center, Natural Resources Defense Council, ("SCoC Organizations 
Sierra Club, Union of Concerned Scientists Comm enters") 
GE Appliances GEA Manufacturer 
C. Keith Rice Rice Individual 20619 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
16Each 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. 
17The 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). with the prior comment periods, 
provides sufficient time for interested parties to review the proposed rule and develop comments. 
III. General Discussion 
DOE developed this proposal after 
considering oral and written comments, 
data, and information from interested parties that represent a variety of interests. The following discussion addresses issues raised by these commenters. 
A. Product Classes and Scope of 
Coverage 
When evaluating and establishing 
energy conservation standards, DOE divides covered products into product classes by the type of energy used or by capacity or other performance-related features that justify differing standards. In making a determination whether a performance-related feature justifies a different standard, DOE must consider such factors as the utility of the feature to the consumer and other factors DOE determines are appropriate. (42 U.S.C. 6295(q)) DOE’s preliminary analysis indicated that the current room AC product classes are still appropriate. 
B. Test Procedure 
EPCA sets forth generally applicable 
criteria and procedures for DOE’s 
adoption and amendment of test procedures. (42 U.S.C. 6293) Manufacturers of covered products must use these test procedures to certify to DOE that their product complies with energy conservation standards and to quantify the efficiency of their product. In addition, consistent with section 8(d)(1)(i) of appendix A, DOE will finalize amended test procedures that impact measured energy use or efficiency at least 180 days prior to the close of the comment period for a NOPR proposing new or amended energy conservation standards. DOE published a test procedure final rule on March 29, 2021, retaining the CEER metric used to express DOE’s current energy conservation standards for room ACs in Btu/Wh. 86 FR 16446. DOE’s test procedures for room ACs appear at appendix F to 10 CFR part 430, subpart B. 
C. 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 appendix A. 
After DOE has determined that 
particular technology options are technologically feasible, it further evaluates each technology option in light of the following additional screening criteria: (1) Practicability to manufacture, install, and service; (2) adverse impacts on product utility or availability; (3) adverse impacts on health or safety, and (4) unique-pathway proprietary technologies. Sections 6(b)(3)(ii)–(v) and 7(b)(2)–(5) of appendix A. Section IV.B of this document discusses the results of the screening analysis for room ACs, particularly the designs DOE considered, those it screened out, and those that are the basis for the standards considered in this proposed rulemaking. For further details on the screening analysis for this proposed 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 room ACs, 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 proposed rulemaking are described in section IV.C.1 of this document and in chapter 5 of the NOPR TSD. 
D. Energy Savings 
For each trial standard level (‘‘TSL’’), 
DOE projected energy savings from 
application of the TSL to room ACs purchased in the 30-year period that begins in the year of compliance with the proposed standards (2026–2055).
16 The savings are measured over the 
entire lifetime of a room AC purchased in the previous 30-year period. DOE quantified the energy savings attributable to each TSL as the difference in energy consumption between each standards case and the no- new-standards case. The no-new- standards case represents a projection of energy consumption that reflects how the market for a product would likely evolve in the absence of amended energy conservation standards. 
DOE used its national impact analysis 
(‘‘NIA’’) spreadsheet model to estimate national energy savings (‘‘NES’’) from potential amended or new standards for room ACs. 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. DOE also calculates NES in terms of full-fuel cycle (‘‘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.
17DOE’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. 
1. 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)) Although the term ‘‘significant’’ is not defined in the EPCA, the U.S. Court of Appeals, for the District of Columbia Circuit in Natural Resources Defense Council v. Herrington, 768 F.2d 1355, 1373 (D.C. 
Cir. 1985), opined that Congress 
intended ‘‘significant’’ energy savings in the context of EPCA to be savings that were not ‘‘genuinely trivial.’’ 
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 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00013 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420620 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
18The 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). given rulemaking.18For example, the 
United States recently rejoined the Paris 
Agreement and will exert leadership in confronting the climate crisis. These actions have placed an increased emphasis on the importance of energy savings that reduce greenhouse gas emissions and help mitigate the climate crisis. Additionally, some covered products and equipment, particularly those providing space cooling, such as room ACs, are likely to consume significant energy 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. Lastly, in evaluating the significance of energy savings, DOE considers differences in primary energy and FFC effects for different covered products and equipment when determining whether energy savings are significant. Primary energy and FFC effects include the energy consumed in electricity production (depending on load shape), in distribution and transmission, and in extracting, processing, and transporting primary fuels (i.e., coal, natural gas, petroleum 
fuels), and thus present a more complete picture of the impacts of energy conservation standards. 
Accordingly, DOE is evaluating the 
significance of energy savings on a case- by-case basis. DOE has initially determined the energy savings for the TSL proposed in this rulemaking are nontrivial, and, therefore, DOE considers them ‘‘significant’’ within the meaning of 42 U.S.C. 6295(o)(3)(B). 
E. Economic Justification 
1. Specific Criteria 
As noted previously, EPCA provides 
seven factors to be evaluated in 
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 product-specific regulatory requirements on manufacturers. 
For individual consumers, measures 
of economic impact include the changes in LCC and PBP associated with new or amended standards. These measures are discussed further in the following section. For consumers in the aggregate, DOE also calculates the national net present value of the consumer costs and benefits expected to result from particular standards. DOE also evaluates the impacts of potential standards on identifiable subgroups of consumers that may be affected disproportionately by a standard. 
b. Savings in Operating Costs Compared 
to Increase in Price (LCC and PBP) 
EPCA requires DOE to consider the 
savings in operating costs throughout the estimated average life of the covered product in the type (or class) compared to any increase in the price of, or in the initial charges for, or maintenance 
expenses of, the covered product that are likely to result from a standard. (42 U.S.C. 6295(o)(2)(B)(i)(II)) DOE conducts this comparison in its LCC and PBP analysis. 
The LCC is the sum of the purchase 
price of a product (including its installation) and the operating expense (including energy, maintenance, and repair expenditures) discounted over the lifetime of the product. The LCC analysis requires a variety of inputs, such as product prices, product energy consumption, energy prices, maintenance and repair costs, product lifetime, and discount rates appropriate for consumers. To account for uncertainty and variability in specific inputs, such as product lifetime and discount rate, DOE uses a distribution of values, with probabilities attached to 
each value. 
The PBP is the estimated amount of 
time (in years) it takes consumers to recover the increased purchase cost (including installation) of a more- 
efficient product through lower operating costs. DOE calculates the PBP by dividing the change in purchase cost due to a more-stringent standard by the change in annual operating cost for the year that standards are assumed to take effect. 
For its LCC and PBP analysis, DOE 
assumes that consumers will purchase the covered products in the first year of compliance with new or amended standards. The LCC savings for the considered efficiency levels are calculated relative to the case that reflects projected market trends in the absence of new or amended standards. DOE’s LCC and PBP analysis is discussed in further detail in section IV.F of this document. 
c. Energy Savings 
Although significant conservation of 
energy is a separate statutory 
requirement for adopting an energy conservation standard, EPCA requires DOE, in determining the economic justification of a standard, to consider the total projected energy savings that are expected to result directly from the standard. (42 U.S.C. 6295(o)(2)(B)(i)(III)) As discussed in section III.D of this document, DOE uses the NIA spreadsheet models to project national energy savings. 
d. Lessening of Utility or Performance of 
Products 
In establishing product classes and in 
evaluating design options and the impact of potential standard levels, DOE evaluates potential standards that would not lessen the utility or performance of the considered products. (42 U.S.C. 6295(o)(2)(B)(i)(IV)) Based on data available to DOE, the standards proposed in this document would not reduce the utility or performance of the products under consideration in this rulemaking. 
e. Impact of Any Lessening of 
Competition 
EPCA directs DOE to consider the 
impact of any lessening of competition, as determined in writing by the Attorney General, that is likely to result from a proposed standard. (42 U.S.C. 6295(o)(2)(B)(i)(V)) It also directs the Attorney General to determine the impact, if any, of any lessening of competition likely to result from a proposed standard and to transmit such determination to the Secretary within 60 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00014 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420621 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
19A notation in the form ‘‘Joint Commenters, No. 
20 at p. 1’’ identifies a written comment: (1) Made 
by the Joint Commenters; (2) recorded in document number 20 that is filed in the docket of this energy conservation standards rulemaking (Docket No. EERE–2014–BT–STD–0059) and available for review at www.regulations.gov; and (3) which 
appears on page 1 of document number 20. days of the publication of a proposed 
rule, together with an analysis of the nature and extent of the impact. (42 U.S.C. 6295(o)(2)(B)(ii)) DOE will transmit a copy of this proposed rule to the Attorney General with a request that the Department of Justice (‘‘DOJ’’) provide its determination on this issue. DOE will publish and respond to the Attorney General’s determination in the final rule. DOE invites comment from the public regarding the competitive impacts that are likely to result from this proposed rule. In addition, stakeholders may also provide comments separately to DOJ regarding these potential impacts. See the 
ADDRESSES section for information to 
send comments to DOJ. 
f. Need for National Energy 
Conservation 
DOE also considers the need for 
national energy and water conservation in determining whether a new or amended standard is economically justified. (42 U.S.C. 6295(o)(2)(B)(i)(VI)) The energy savings from the proposed standards are likely to provide improvements to the security and reliability of the Nation’s energy system. Reductions in the demand for electricity also may result in reduced costs for maintaining the reliability of the Nation’s electricity system. DOE conducts a utility impact analysis to 
estimate how standards may affect the Nation’s needed power generation capacity, as discussed in section IV.M of this document. 
DOE maintains that environmental 
and public health benefits associated with the more efficient use of energy are important to take into account when considering the need for national energy conservation. The proposed standards are likely to result in environmental benefits in the form of reduced emissions of air pollutants and greenhouse gases (‘‘GHGs’’) associated with energy production and use. As part of the analysis of the need for national energy and water conservation, 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. 
g. Other Factors 
In determining whether an energy 
conservation standard is economically 
justified, DOE may consider other factors that the Secretary deems to be relevant. (42 U.S.C. 6295(o)(2)(B)(i)(VII)) To the extent DOE identifies any relevant information regarding economic justification that does not fit 
into the other categories described previously, DOE could consider such information under ‘‘other factors.’’ 
2. Rebuttable Presumption 
As set forth in 42 U.S.C. 
6295(o)(2)(B)(iii), EPCA creates a 
rebuttable presumption that an energy conservation standard is economically justified if the additional cost to the consumer of a product that meets the standard is less than three times the value of the first year’s energy savings resulting from the standard, as calculated under the applicable DOE test procedure. DOE’s LCC and PBP analyses generate values used to calculate the effects that proposed energy conservation standards would have on the payback period for consumers. These analyses include, but are not limited to, the 3-year payback period contemplated under the rebuttable-presumption test. In addition, DOE routinely conducts an economic analysis that considers the full range of impacts to consumers, manufacturers, the Nation, and the environment, as required under 42 U.S.C. 6295(o)(2)(B)(i). The results of this analysis serve as the basis for DOE’s evaluation of the economic justification for a potential standard level (thereby supporting or rebutting the results of any preliminary determination of 
economic justification). The rebuttable presumption payback calculation is discussed in section IV.F.9 of this document. 
IV. Methodology and Discussion of 
Related Comments 
This section addresses the analyses 
DOE has performed for this proposed rulemaking with regard to room ACs. 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 proposed rulemaking: www.regulations.gov/docket?D=EERE- 2014-BT-STD-0059. Additionally, DOE 
used output from the latest version of the Energy Information Administration’s (‘‘EIA’s’’) Annual Energy Outlook 
(‘‘AEO’’), a widely known energy projection for the United States, for the emissions and utility impact analyses. 
A. Market and Technology Assessment 
DOE develops information in the 
market and technology assessment that 
provides an overall picture of the market for the products concerned, including the purpose of the products, the industry structure, manufacturers, market characteristics, and technologies used in the products. This activity includes both quantitative and qualitative assessments, based primarily on publicly-available information. The subjects addressed in the market and technology assessment for this proposed rulemaking include (1) a determination of the scope of the rulemaking and product classes, (2) manufacturers and industry structure, (3) existing efficiency programs, (4) shipments information, (5) market and industry trends, and (6) technologies or design options that could improve the energy efficiency of room ACs. 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. Scope of Coverage and Product 
Classes 
In the June 2020 Preliminary 
Analysis, DOE did not identify any potential changes to the room AC scope of coverage or product classes. 85 FR 36512. 
The Joint Commenters expressed 
concerns regarding DOE’s current set of room AC product classes. (Joint Commenters, No. 20 at p. 1
19) The Joint 
Commenters disagreed with DOE’s explanation that Product Classes 1 and 6 are necessary, despite having the same efficiency requirements as Product Classes 2 and 7, respectively, to recognize the value to certain consumer segments of a low-cost, low-cooling capacity room AC in Product Classes 1 and 6. They did not object to maintaining these product class distinctions based on cooling capacity, but suggested that cost must not be a rationale for maintaining the 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00015 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420622 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
distinctions because cost is not a 
‘‘performance-related feature.’’ Id. 
DOE understands the Joint 
Commenters’ concerns about cost being a rationale for distinguishing product classes. However, the cost is substantively related to the performance-related features used to distinguish between the product classes, namely product size and weight. The NOPR analysis, based on models currently on the market, identified different efficiency levels above the ENERGY STAR
®qualification levels for 
Product Classes 1 and 2, showing that these product classes have performance- 
related distinctions between them. 
While DOE is not proposing to 
combine product classes at this time, DOE is proposing a clarifying modification to the cooling capacity descriptors delineating the product classes, specifying that the capacity used to determine the product class of a basic model is the certified cooling capacity and expressing the capacity ranges to the nearest hundred British 
thermal units per hour (‘‘Btu/h’’) in accordance with the rounding instruction in 10 CFR 429.15(a)(3). For example, Product Class 2 currently specifies it includes room ACs with capacities ranging from 6,000 to 7,999 Btu/h; however, DOE recognizes that based on the rounding instruction in 10 CFR 429.15(a)(3), the upper range of this product class is, in practice, 7,900 Btu/ h. Accordingly, DOE proposes in this NOPR to revise the threshold values of 
cooling capacity in the product class descriptions to the nearest hundred Btu/ h that would not exceed the existing thresholds. DOE believes this slight modification that is being proposed for product class delineation is what manufacturers are using today in practice due to the rounding instruction at 10 CFR 429.15(a)(3) and will not impact compliance with current energy conservation standards. DOE is simply proposing to add clarity and consistency amongst two existing regulatory 
provisions. 
DOE requests comment on the 
proposal to make clarifying amendments to the product class descriptions, but otherwise not make any changes to room AC product classes. 
For ease of reviewing this NOPR, DOE 
is presenting the results of its analysis using the existing product class descriptions. The proposed new labeling of the product class thresholds using the rounded cooling capacity values are included in the proposed standards in Table I.1 and Table V.58 of this document. 
2. Technology Options 
In the preliminary market analysis 
and technology assessment, DOE 
identified 22 technology options that would likely improve the efficiency of room ACs, as measured by the DOE test procedure: 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00016 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420623 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
20As determined using experimental infrared 
camera imaging techniques applied to units outside 
of controlled calorimeter chamber conditions. 
21s3.amazonaws.com/szmanuals/ 
f50601c1a4960b3d7627df44cc951d28. 
Several commenters provided 
feedback on some of these technology 
options. These comments are summarized below, along with DOE’s responses. 
a. Reduced Evaporator Air Recirculation 
The Joint Commenters referenced a 
2013 National Renewable Energy 
Laboratory (‘‘NREL’’) study in which room AC performance was found to degrade with evaporator air recirculation, with the cooling coefficient of performance (‘‘COP’’) decreasing by 7 percent on average.
20 21 
The Joint Commenters emphasized NREL’s conclusion that the room AC energy efficiency ratio (‘‘EER’’) could be improved by at least 1 Btu/Wh using simple and low-cost methods such as supplying air from the bottom rather than the top of the interior face, or providing an attachment fin to separate supply and return airflows. The Joint Commenters noted that DOE mentioned the results of this NREL study in the preliminary TSD but did not consider reduced evaporator air recirculation in the engineering analysis. Thus, given the large potential energy savings, the Joint Commenters urged DOE to investigate how to model the efficiency improvement associated with reduced evaporator air recirculation. (Joint Commenters, No. 20 at p. 2) 
DOE is aware of, and has reviewed the 
2013 NREL study cited by the Joint Commenters, and notes that that study 
had a limited sample of four room ACs from only two different manufacturers (Frigidaire and GE/Haier), and found a wide range of COP degradation due to evaporator air recirculation, from losses as low as 2 percent to as high as 19 percent. Without intensive airflow modeling of each unit analyzed in the DOE teardown sample, more data on evaporator air recirculation in the 
market as a whole, and test data from a unit incorporating the sort of airflow changes suggested by NREL (DOE is not aware of such a unit on the market), DOE is unable to properly assess the impacts, both positive and negative of evaporator air recirculation reduction as a technology. Therefore, DOE is not incorporating this technology into its engineering analysis. DOE seeks 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00017 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.017</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table IV.I Technology Options for Room Air Conditioners 
Increased Heat Transfer Surface Area 
1. Increased heat exchanger surface area (frontal area, fin density and depth of coil) 
2. Condenser coil subcooler 
3. Suction line heat exchanger 
Increased Heat Transfer Coefficient 
4. Improved fin and tube design 
5. Hydrophilic coating on fins 
6. Microchannel heat exchangers 
7. Spray condensate on condenser coil 
Component Improvements 
8. Improved indoor blower and outdoor fan blade design 
9. Improved blower/fan motor design 
10. Improved compressor efficiency 
Improved Installation, Insulation, and Airflow 
11. Improved installation materials 
12. Reduced evaporator air recirculation 
13. Reduced thermal bridging and internal air leakage 
Part-load Performance 
14. Variable-speed compressors 
15. Variable-speed drive fans and blowers 
16. Thermostatic or electronic expansion valves 
17. Thermostatic cyclic controls 
18. Air and water economizers 
Standby Power Improvements 
19. Low standby-power electronics 
20. High frequency switching power suooly 
Alternative Refrigerants 
21. SNAP-approved refrigerants (R-32. R-44 lA. and R-290) 
Other Improvements 
22. Washable air filters 20624 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
22For the latest information on EPA SNAP 
regulations, visit: www.epa.gov/snap/snap- 
regulations. 
23A notation in the form ‘‘NEEA, Public Meeting 
Transcript, No. 18 at pp. 59–60’’ identifies an oral comment that DOE received on August 25, 2020 during the public meeting, and was recorded in the public meeting transcript in the docket for this energy conservation standards rulemaking (Docket No. EERE–2014–BT–STD–0059). This particular notation refers to a comment (1) made by the Northwest Energy Efficiency Alliance during the public meeting; (2) recorded in document number 18, which is the public meeting transcript that is filed in the docket of this energy conservation standards rulemaking; and (3) which appears on pages 59 through 60 of document number 18. 
24See https://ww2.arb.ca.gov/rulemaking/2020/ 
hfc2020 for more information on the CARB 
refrigerant rulemaking. additional comment on whether 
evaporator air recirculation should be included in the engineering analysis. 
b. Compressors 
AHAM and GEA stated that their data 
do not support DOE’s assumptions 
regarding the efficiency of single-speed compressors. (AHAM, No. 19 at p. 12; GEA, No. 26 at pp. 1–2) 
Feedback given to DOE by 
manufacturers during interviews supported the commenters’ assertion that the efficiency of the most efficient single-speed compressor available was overestimated in the June 2020 Preliminary Analysis. Upon further analysis, DOE has reduced its estimate for the efficiency of the most efficient single-speed R–410a compressor available, from 13.1 to 10.9 Btu/Wh, based on a comprehensive survey of compressor catalogues and information provided by manufacturers, as discussed further in chapter 3 of the NOPR TSD. However, as discussed below, DOE also implemented a changeover from R–410A to R–32 refrigerant, resulting in the most efficient available single-speed compressor being 12.7 Btu/Wh. DOE requests comment on the updated single-speed compressor maximum efficiency estimates. 
c. Significant New Alternatives Policy 
(SNAP)—Approved Refrigerants 
In the June 2020 Preliminary 
Analysis, DOE discussed the potential for alternative refrigerants, restricted to the Significant New Alternatives Policy (‘‘SNAP’’)—approved refrigerants (i.e., R–32, R–441A, R–290),
22but decided to 
forgo implementing them in the engineering analysis because they either did not significantly improve unit efficiency or DOE lacked sufficient technical and economic data to assess the costs and benefits of a changeover. AHAM, the California IOUs, Joint Commenters, and NEEA disagreed with DOE’s decision not to consider these alternative refrigerants in the engineering analysis. They stated that alternative refrigerants are already in use for some product classes to meet current energy conservation standards (baseline) and ENERGY STAR (Efficiency Level (‘‘EL 2’’)) levels. (AHAM, No. 19 at pp. 10–11; California 
IOUs, No. 23 at p. 3; Joint Commenters, No. 20 at p. 2; NEEA, No. 24 at pp. 4– 5; NEEA, Public Meeting Transcript, No. 18 at pp. 59–60)
23AHAM emphasized the significant costs associated with changing refrigerant type. (AHAM, No. 19 at pp. 10–11) The California IOUs, Joint Commenters, and NEEA specifically noted that room ACs using R–32 are now widely available in the United States, suggesting that the use of alternative refrigerants is not cost prohibitive to manufacturers, as DOE stated in the preliminary TSD. NEEA stated that manufacturers using R–32 in air conditioning systems have generally found energy savings ranging from 8 to 11 percent. AHAM, the California IOUs, and NEEA noted that there is currently a proposed rule from the California Air Resource Board (‘‘CARB’’) that would ban all refrigerants with global warming potential (‘‘GWP’’) equal to or greater than 750 in new residential and commercial AC systems beginning in 2023 and would likely push additional manufacturers to explore alternative refrigerants.
24(AHAM, No. 19 at pp. 10– 
11; California IOUs, No. 23 at p. 3; Joint Commenters, No. 20 at p. 2; NEEA, No. 24 at pp. 4–5; NEEA, Public Meeting Transcript, No. 18 at pp. 59–60) The Joint Commenters referenced a study performed by the Oak Ridge National Laboratory (‘‘ORNL’’) in which ORNL developed a high-efficiency room AC to determine the viability of a window AC unit with an EER over 13.0 Btu/Wh and found that using a ‘‘drop-in’’ 85-percent R–32 mixture as the refrigerant in place of R–410A boosted efficiency by about 3 percent and, thus, that pure R–32 would offer an additional efficiency gain. The Joint Commenters referenced another ORNL study in which a room AC unit was modified to use propane (R–290) and demonstrated an increase in EER of 17 percent. The Joint Commenters also stated that, while any cost impacts to consumers and/or manufacturers should be considered as part of the economic analysis, cost cannot be a consideration in determining what is technologically feasible. (Joint Commenters, No. 20 at p. 2) Thus, AHAM, the California IOUs, Joint Commenters, and NEEA urged DOE to further investigate alternative refrigerants as a technology option. (AHAM, No. 19 at pp. 10–11; California 
IOUs, No. 23 at p. 3; Joint Commenters, No. 20 at p. 2; NEEA, No. 24 at pp. 4– 5) NEEA specifically urged DOE to consider R–32. (NEEA, No. 24 at pp. 4– 5) The California IOUs encouraged DOE to work closely with CARB, the American Society of Heating, Refrigerating and Air-Conditioning Engineers (‘‘ASHRAE’’) Standing Standard Project Committee 15—Safety Standard for Refrigeration Systems, and the Air-Conditioning, Heating, and Refrigeration Institute (‘‘AHRI’’) Low- GWP Alternative Refrigeration Evaluation Program to address in this rulemaking the efficiency benefits from using low-GWP refrigerants in room ACs. (California IOUs, No. 23 at p. 3) 
DOE is aware that R–32 refrigerant is 
currently in use in the room AC market and that adoption of the refrigerant in room ACs is increasing, in part due to the CARB regulation regarding low- GWP refrigerants. R–32 has a GWP of 675, just under a third of the GWP of R– 410a, which is 2,090. However, the research findings on efficiency impacts due to the transition from R–410A to R– 32 are inconsistent, ranging from a 2- percent decrease in efficiency to the 8- to 11-percent increase cited by NEEA. Due to these inconsistent data, DOE did not consider efficiency gains due to R– 32 implementation alone. However, as discussed previously, DOE found that the most efficient single-speed compressors available on the market use 
R–32 refrigerant, so DOE did incorporate a changeover to R–32 in the engineering analysis to capture the compressor efficiency gains that are technologically feasible by implementing improved-efficiency single-speed compressors (which use R– 32 refrigerant) in place of existing baseline-efficiency single-speed compressors (which use R–410A refrigerant). DOE requests comment on the approach to addressing alternative refrigerants in this engineering analysis. 
B. Screening Analysis 
DOE uses the following five screening 
criteria to determine which technology 
options are suitable for further consideration in an energy conservation standards rulemaking: 
(1) Technological feasibility. 
Technologies that are not incorporated in commercial products or in working prototypes will not be considered further. 
(2) Practicability to manufacture, 
install, and service. If it is determined that mass production and reliable installation and servicing of a technology in commercial products could not be achieved on the scale 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00018 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420625 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
necessary to serve the relevant market at 
the time of the projected compliance date of the standard, then that technology will not be considered further. 
(3) Impacts on product utility or 
product availability. If it is determined that a technology would have significant adverse impact on the utility of the product to significant subgroups of consumers or would result in the unavailability of any covered product type with performance characteristics (including reliability), features, sizes, capacities, and volumes that are substantially the same as products generally available in the United States 
at the time, it will not be considered further. 
(4) Adverse impacts on health or 
safety. If it is determined that a 
technology would have significant adverse impacts on health or safety, it will not be considered further. 
(5) Unique-Pathway Proprietary 
Technologies. If a design option utilizes 
proprietary technology that represents a unique pathway to achieving a given efficiency level, that technology will not be considered further due to the 
potential for monopolistic concerns. 
Sections 6(b)(3) and 7(b) of appendix 
A. 
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 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 the June 2020 Preliminary 
Analysis, DOE considered screening out 
air and water economizers and suction- line heat exchangers in the screening analysis, based on their negative impacts on product utility to consumers and on manufacturing impracticality. 
AHAM agreed with DOE screening 
out these technologies. AHAM stated, as DOE noted, air and water economizers 
and suction line heat exchangers would increase the size and weight of room ACs, which would negatively impact consumer utility and require retooling. AHAM further stated that suction line heat exchangers could also decrease compressor lifetime. (AHAM, No. 19 at 
p. 10) 
DOE agrees with the comments made 
by AHAM and proposes to screen out the same technologies in this NOPR analysis. For additional details, see chapter 4 of the NOPR TSD. DOE requests comment on the technologies screened out in the NOPR screening analysis. 
2. Remaining Technologies 
Through a review of each technology, 
DOE tentatively concludes that all of the 
other identified technologies listed in section IV.A.2 of this document met all five screening criteria to be examined further as design options in DOE’s NOPR analysis. In summary, DOE did not screen out the following technology options: 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00019 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420626 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
DOE 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 consumer utility, product availability, 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 room ACs. 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). 
1. Efficiency Analysis 
DOE typically uses one of two 
approaches to develop energy efficiency 
levels for the engineering analysis: (1) Relying on observed efficiency levels in the market (i.e., the efficiency-level 
approach), or (2) determining the incremental efficiency improvements associated with incorporating specific design options to a baseline model (i.e., the design-option approach). Using the efficiency-level approach, the efficiency levels established for the analysis are 
determined based on the market distribution of existing products (in other words, based on the range of efficiencies and efficiency level ‘‘clusters’’ that already exist on the market). Using the design option approach, the efficiency levels established for the analysis are 
determined through detailed engineering calculations and/or computer simulations of the efficiency improvements from implementing specific design options that have been identified in the technology assessment. DOE may also rely on a combination of these two approaches. For example, the efficiency-level approach (based on actual products on the market) may be extended using the design option approach to ‘‘gap fill’’ levels (to bridge large gaps between other identified efficiency levels) and/or to extrapolate to the max-tech level (particularly in cases where the max-tech level exceeds 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00020 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.018</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table IV.2 Retained Design Options for Room Air Conditioners 
15. Thermostatic or electronic ex ansion valves 20627 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
the maximum efficiency level currently 
available on the market). 
In this proposed rulemaking, DOE 
relies on a combination of these two approaches. For each product class, DOE analyzed a few units from different manufacturers to ensure the analysis was representative of various designs on the market. The analysis involved physically disassembling commercially available products, reviewing publicly available cost information, and modeling equipment cost. From this information, DOE estimated the manufacturer production costs (‘‘MPCs’’) for a range of products currently available on the market. DOE then considered the design options manufacturers would likely rely on to improve product efficiencies. From this information, DOE estimated the cost and efficiency impacts of incorporating specific design options at each efficiency level. 
DOE analyzed six efficiency levels as 
part of the engineering analysis: (1) The current DOE standard (baseline); (2) an intermediate level above the baseline but below the ENERGY STAR level, either halfway between the two or at a level where a number of models were certified (EL 1); (3) the ENERGY STAR efficiency criterion (EL 2); (4) the efficiency attainable by a unit with the most efficient R–32 single-speed compressor on the market (EL 3); (5) an intermediate level representing the efficiency of variable-speed units on the market, as tested by DOE using the recently amended test procedure (EL 4); and (6) the maximum technologically feasible (max-tech) efficiency (EL 5). 
In evaluating the technologies 
manufacturers could use to achieve the analyzed efficiency levels, DOE considered design options which made the largest impact on unit efficiency and for which the cost-efficiency relationship was well defined. Accordingly, DOE implemented increased heat exchanger area, condenser coil subcoolers, improved blower motor efficiency, improved compressor efficiency, variable-speed compressors, and low standby-power electronic controls as design options, some or all of which were used to estimate the cost required to reach each efficiently level. DOE did not consider for analysis certain technologies that 
met the screening criteria but were unable to be evaluated for one or more of the following reasons: (1) Data are not available to evaluate the energy efficiency characteristics of the technology, (2) available data suggest that the efficiency benefits of the technology are negligible, and (3) certain technologies cannot be measured according to the conditions and 
methods specified in the existing test procedure. Further information on how the design options were chosen and implemented in the engineering analysis is available in chapter 5 of the NOPR TSD. 
a. Baseline Efficiency 
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. 
For this NOPR, DOE selected 19 
baseline units, of the 48 total units selected, that fell within 12 of the 16 room AC product classes as reference points for each analyzed product class, 
against which DOE measured changes that would result from amended energy conservation standards to support the engineering, LCC, and PBP analyses. The baseline units in each of the analyzed product classes represent the basic characteristics of equipment in that class 
b. Higher Efficiency Levels 
As part of DOE’s analysis, the 
maximum available efficiency level is 
the highest efficiency unit currently available on the market. DOE also defines the ‘‘max-tech’’ efficiency level to represent the maximum possible efficiency for a given product. As discussed in chapter 5 of the NOPR TSD, for the max-tech level, DOE modeled replacing permanent split capacitor (‘‘PSC’’) fan motors with more efficient electronically commutated motors (‘‘ECMs’’), replacing single- speed compressors with the maximum efficiency variable-speed compressors available, reducing standby power to the minimum observed in DOE’s teardown sample, and increasing the cabinet and heat exchanger to the largest feasible sizes to improve efficiency. For all product classes, the max-tech level identified for EL 5 exceeds any other regulatory or voluntary efficiency criteria currently in effect. 
DOE notes that the max-tech level is 
based entirely on modeled combinations of design options that have not yet been combined in a commercially available product. Notably, the key design option, variable-speed compressors, are nascent in room ACs, and because there are no 
models on the market or prototypes that implement these highest efficiency variable-speed compressors, the efficiency level at max-tech for each product class is a numerical estimation. This is in contrast to the variable-speed compressors currently implemented in room ACs on the market today, for which performance has been characterized through testing. Furthermore, the room AC test procedure measures variable-speed unit performance differently than test procedures for other air conditioning products, so limited performance and efficiency data are available for the most efficient examples of this emergent technology for room ACs. 
Additionally, the most efficient 
variable-speed compressors that were implemented in the analysis at the max- tech efficiency level are manufactured by one manufacturer and have rated EERs between 11.2 and 11.7 Btu/Wh, with a range of rated capacities between 4,705 Btu/h and 16,170 Btu/h. Given the lack of information regarding availability of these highest efficiency variable-speed compressors, and the limited number of variable-speed compressors rated at or near the compressors considered for the max- tech efficiency level, there may not be widespread availability of these high- efficiency variable-speed compressors. 
The Joint Commenters and NEEA 
encouraged DOE to consider evaluating additional efficiency levels, particularly an intermediate level between EL 3 and EL 4. According to the Joint Commenters and NEEA, the most efficient products available today fall between these two efficiency levels. (Joint Commenters, No. 20 at pp. 2–3; NEEA, No. 24 at pp. 3 and 7) DOE agrees that the most efficient available units should be represented in the engineering analysis. In particular, variable-speed models, of which an increasing number of models are available, were not included in a separate efficiency level in the preliminary engineering analysis as a stand-alone design option. Therefore, DOE included a new efficiency level (EL 4) in the NOPR engineering analysis, between EL 3 and the max-tech level (EL 4 in the preliminary analysis, now EL 5 for this NOPR). This new EL 4 is an intermediate efficiency level that represents the efficiency of variable- speed units on the market, as tested by DOE using the recently amended test procedure. DOE modeled all teardown units to reach this efficiency level in the engineering analysis by replacing each 
single-speed compressor with a variable-speed compressor and 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00021 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420628 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
25Because 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. 
26U.S. Census Bureau, Annual Retail Trade 
Survey. 2017. www.census.gov/programs-surveys/ 
arts.html. adjusting the rated efficiency of the 
modeled variable-speed compressor to achieve the target overall CEER value. DOE requests comment on the new efficiency level (EL 4) in the engineering analysis. 
AHAM and GEA stated that any 
energy standard levels achievable only with variable-speed compressors should not be selected and asserted that EL 3 and above would require the use of variable-speed compressors. AHAM and GEA further stated that manufacturers would likely begin using variable-speed compressors to meet energy conservation standards at EL 3. GEA supported AHAM’s position and noted that incorporating variable-speed compressors into existing room AC units requires platform-level changes to room AC designs and manufacturing facilities. GEA further stated that, while variable-speed compressors are becoming available in some products, the technology is not sufficiently cost- effective to use as the basis for setting an energy standard level for this proposed rulemaking. Thus, AHAM and GEA urged DOE to adjust its analysis to reflect the use of variable-speed compressors at EL 3. (AHAM, No. 19 at pp. 11–12; GEA, No. 26 at pp. 1–2) 
As discussed in section IV.A.2.b of 
this document, DOE adjusted its estimated efficiency for the most efficient available single-speed compressors, thus slightly reducing the CEER level for EL 3, but along with the additional proposed changeover to more efficient compressors that use R–32 refrigerant, room ACs that implement single-speed compressors are still expected to meet EL 3. Therefore, DOE did not revise its analysis to assume that the use of variable-speed compressors would be necessary to achieve EL 3. DOE requests comment on the approach to design EL 3 as the level reached by the most efficient single-speed room ACs. 
2. Cost Analysis 
The cost analysis portion of the 
engineering analysis is conducted using 
one or a combination of cost approaches. The selection of cost approach depends on a suite of factors, including the availability and reliability of public information, characteristics of the regulated product, the availability and timeliness of purchasing the product on the market. The cost approaches are summarized as follows: 
•Physical teardowns: Under this 
approach, DOE physically dismantles a commercially available product, component-by-component, to develop a detailed bill of materials 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 (‘‘BOM’’) for the product. 
•Price surveys: If neither a physical 
nor catalog teardown is feasible (for example, for tightly integrated products such as fluorescent lamps, which are infeasible to disassemble and for which parts diagrams are unavailable) or cost- prohibitive and otherwise impractical (e.g., large commercial boilers), DOE 
conducts price surveys using publicly available pricing data published on major online retailer websites and/or by soliciting prices from distributors and other commercial channels. 
In the present case, DOE conducted 
the analysis using physical teardowns. The resulting BOM provides the basis for the MPC estimates. DOE estimated the cost of the highest efficiency single- speed and variable-speed compressors implemented in EL 3 and EL 5, respectively, by extrapolating the costs from price surveys of other compressors. DOE used this approach because, as discussed previously, DOE is not aware of these most efficient single-speed and variable-speed compressors being implemented in any available room ACs to date. 
3. Cost-Efficiency Results 
The results of the engineering analysis 
are presented as cost-efficiency data for 
each of the efficiency levels for each of the product classes that were analyzed, as well as those extrapolated from a product class with similar cooling capacity and features. DOE developed estimates of MPCs for each unit in the teardown sample, and also performed additional modeling for each of the teardown samples, to develop a comprehensive set of MPCs at each 
efficiency level. DOE then consolidated the resulting MPCs for each of DOE’s teardown units and modeled units using a weighted average for product classes in which DOE analyzed units from multiple manufacturers. DOE’s weighting factors were based on a market penetration analysis for each of the manufacturers within each product class. The resulting weighted-average incremental MPCs (i.e., the additional 
costs manufacturers would likely incur by producing room ACs at each efficiency level compared to the baseline) are provided in Tables 5.5.5 and 5.5.6 in chapter 5 of the NOPR TSD. See chapter 5 of the NOPR TSD for additional detail on the engineering analysis. DOE requests comment on the incremental MPCs from the NOPR 
engineering analysis. 
D. Markups Analysis 
The markups analysis develops 
appropriate markups (e.g., retailer 
markups, distributor markups, 
contractor markups) in the distribution chain and sales taxes to convert the MPC estimates derived in the engineering analysis to consumer prices, which are then used in the LCC and PBP analysis and in the manufacturer impact 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 applied a non-production cost 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 Securities and Exchange Commission (‘‘SEC’’) 10–K reports filed by publicly traded manufacturers primarily engaged in appliance manufacturing and whose combined product range includes room ACs. 
For room ACs, DOE further developed 
baseline and incremental markups for each link in the distribution chain (after the product leaves the manufacturer). 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 profit before and after new or amended standards.
25 
DOE relied on economic data from the 
U.S. Census Bureau to estimate average baseline and incremental markups. Specifically, DOE used the 2017 Annual Retail Trade Survey for the ‘‘electronics and appliance stores’’ sector to develop retailer markups;
26and the 2017 
Annual Wholesale Trade Survey for the ‘‘household appliances, and electrical and electronic goods merchant 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00022 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420629 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
27U.S. Census Bureau, Annual Wholesale Trade 
Survey. 2017. www.census.gov/awts. 
28U.S. Department of Energy-Energy Information 
Administration, Residential Energy Consumption 
Survey, 2015 Public Use Microdata Files, 2015. Washington, DC. Available online at: www.eia.doe.gov/emeu/recs/recspubuse15/ pubuse15.html. DOE will update all the 2015 RECS 
data to 2020 RECS if it is available prior to the final rule. 
29U.S. Department of Energy-Energy Information 
Administration, Commercial Buildings Energy Consumption Survey, 2012 Public Use Microdata Files, 2012. Washington, DC. Available online at: www.eia.doe.gov/emeu/cbecs/cbecspubuse12/ pubuse12.html. DOE will update all 2012 CBECS 
data to 2018 CBECS when it becomes available. 30Burke et al., 2014. ‘‘Using Field-Metered Data 
to Quantify Annual Energy Use of Residential Portable Air Conditioners.’’ LBNL, Berkeley, CA. LBNL Report LBNL–6469E. September 2014. wholesalers’’ sector to estimate 
wholesaler markups.27 
Chapter 12 of the NOPR TSD provides 
additional detail on the manufacturer markup and chapter 6 of this NOPR TSD provides additional detail on DOE’s development of the baseline and incremental retail markups. 
E. Energy Use Analysis 
The purpose of the energy use 
analysis is to determine the annual 
energy consumption of room ACs at different efficiencies in representative U.S. single-family homes, multi-family residences, manufactured housing, and commercial buildings, and to assess the energy savings potential of increased room AC efficiency. The energy use analysis estimates the range of energy use of room ACs in the field (i.e., as they 
are actually used by consumers). The energy use analysis provides the basis for other analyses DOE performed, particularly assessments of the energy savings and the monetary savings in consumer operating costs that could result from adoption of amended or new standards. 
To estimate annual room AC use and 
energy consumption in the June 2020 Preliminary Analysis, DOE first calculated the number of operating hours in cooling mode for each room AC in the residential and commercial samples using the reported energy use for room air conditioning in the Residential Energy Consumption Survey (‘‘RECS’’) 2015
28and Commercial 
Building Energy Consumption Survey (‘‘CBECS’’) 2012,
29along with estimates 
of the EER of the room AC(s) in each sample home or building. DOE based the latter on the reported age (or simulated age) of the unit and historical 
data on shipment-weighted average EER. In the June 2020 Preliminary Analysis, the estimated mean number of cooling mode operating hours for the residential room AC sample is 912 hours for the 6,000 to 7,999 Btu/h product class, 636 hours for the 8,000 to 13,999 Btu/h product classes, 422 hours for the 14,999 to 19,999 Btu/h product class, and 261 hours for the ≥20,000 
Btu/h product class. The estimated mean number of cooling mode operating hours for the commercial room AC sample is 746 hours for the 6,000 to 7,999 Btu/h product class, 868 hours for the 8,000 to 13,999 Btu/h product classes, 921 hours for the 14,999 to 19,999 Btu/h product class, and 1,073 hours for the ≥20,000 Btu/h product class. DOE assumed that units plugged in, but not in cooling mode, would be in standby mode and included the contribution of standby power consumption in its energy use model. 
AHAM agreed that, in the absence of 
field data on annual operating hours, DOE should use the most recent version of RECS and CBECS to establish the annual operating hours for residential room ACs. (AHAM, No. 19 at p. 15) 
NEEA believes DOE has identified 
energy savings associated with room ACs, but contends that there are more energy savings achievable. NEEA encourages DOE to look at more of the efficiency technology options and how they perform the energy analysis in order to get more savings. (NEEA, Public Meeting Transcript, No. 18 at pp. 8–9) NEEA suggested modifying the energy use analysis to capture more of the benefits of other technologies in the market that are not necessarily captured in the current test procedure. (Id. at pp. 
57–58) 
DOE notes that the standards 
rulemaking must recommend efficiency levels that are both economically justified and technologically feasible. The availability of technologies used to achieve different efficiency levels are identified in the market and technology assessment (see chapter 3 of the NOPR TSD). DOE’s engineering analysis analyzes technologies in currently available room AC units. The energy use analysis uses the efficiency levels and power consumption values from the engineering analysis. Estimates for energy consumption are based on available data of how room ACs are 
operated in the field. DOE welcomes information about additional technologies that can be analyzed in the rulemaking process. 
NEEA recommended that DOE 
include fan-only hours in its analysis and take into account energy savings from variable-speed fans and motors. NEEA stated that fan-only operation is likely to account for a significant number of operating hours, resulting in a significant portion of overall energy use. (NEEA, No. 24 at p. 5) Rice suggested measuring the energy consumption of the fan-mode during cooling mode operation when the fan typically runs continuously while the compressor cycles. If it is not accounted for, Rice recommended, at a minimum, that the energy use information on the Energy Label indicate that the energy costs is based on the economy mode setting. (Rice, No. 25 at p. 3) 
DOE is unaware of a data set that can 
be used to estimate the amount of time room ACs spend in fan-only mode. For this NOPR analysis, DOE included the impact of fan-only mode energy consumption to the total energy use consumption, based on available data for portable ACs. Based on field metering data of portable ACs, fan-only mode is estimated at 30 percent of cooling mode hours.
30DOE assumed 
that models below ENERGY STAR efficiency level would operate in fan- only mode 30 percent of cooling mode hours. For ELs that meet or exceed the ENERGY STAR level, DOE assumed a reduction in the amount of time the unit spent in fan-only mode based on the ENERGY STAR Version 4.2 for room ACs criterion requiring that the unit run in off-cycle fan mode less than 17 percent of the time spent in off-cycle mode. Thus, for ELs that meet or exceed the ENERGY STAR efficiency level, DOE assumed units would operate in fan-only mode 5 percent of cooling mode hours. DOE welcomes feedback on its approach and any additional data that can be provided to estimate the amount of time spent in fan-only mode. 
DOE notes that the Federal Trade 
Commission is responsible for the information included on the yellow EnergyGuide labels. 
Edison Electric Institute (‘‘EEI’’) noted 
that, in northern climates, many consumers unplug their units or even take them out of the windows during the wintertime, meaning the 8,000 standby hours value used in the annual energy use calculation formula could be an overestimate. EEI suggested gathering more data on this. (EEI, Public Meeting Transcript, No. 18 at pp. 51–52) 
DOE agrees that many consumers 
unplug their room AC units in the non- cooling seasons in northern climates. However, DOE is not aware of reliable, publicly available data for hours spent in standby and off modes in room ACs. DOE recognizes that a room AC may be unplugged for a certain percentage of time, and, therefore, will not be in either standby mode or off mode. For the purposes of this NOPR analysis, DOE estimates that approximately half of room ACs are unplugged for half of the year. The ‘‘unplugged’’ time associated 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00023 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420630 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
31The Room Air Conditioning Life-Cycle Cost 
Analysis Spreadsheets (EERE–2014–BT–STD–0059– 
0010) can be found at beta.regulations.gov/ document/EERE-2014-BT-STD-0059-0010. 32National Oceanic and Atmospheric 
Administration. Quality Controlled Local Climate 
Data. www.ncdc.noaa.gov/cdo-web/. with these units is averaged over all 
units. DOE estimates active mode based on RECS inputs and time spent in fan- only mode based on available data for portable ACs. Standby hours comprise the remaining time. See chapter 7 of the NOPR TSD for further discussion. 
The California IOUs noted that, in the 
LCC Excel spreadsheet downloaded from DOE’s website, for product class (‘‘PC’’) 2, the cooling mode operating hours are 2,922 hours, but for PC 3, the cooling mode operating hours are only 217 hours.
31The California IOUs 
expressed concern at the cooling mode operating hour difference between PC 2 and PC 3. (California IOUs, Public Meeting Transcript, No. 18 at pp. 55–56) 
DOE’s LCC spreadsheet model uses a 
Monte Carlo simulation in its LCC calculations. Operating hours vary for each house in the household sample and are used as an input into the LCC calculations. The hours mentioned in the California IOUs comment represent the operating hours for one household in the sample and are not representative of the full household sample, or an entire Monte Carlo simulation. The average hours of use for the full sample used for each product class can be found in chapter 7 of the NOPR TSD. 
Appliance Standards Awareness 
Project (‘‘ASAP’’), Rice, California IOUs, NEEA, and the Joint Commenters encouraged DOE to investigate modifications to the energy use model to account for potential energy savings by variable-speed units. ASAP stated that variable-speed units would be able to reduce cycling losses in addition to providing additional part-load benefits. (ASAP, Public Meeting Transcript, No. 18 at p. 54) Rice noted that DOE’s energy use methodology in the June 2020 Preliminary Analysis does not capture the benefits of part load operation and suggested applying a performance adjustment factor (‘‘PAF’’) for ELs with variable-speed compressors. (Rice, No. 25 at p. 2) NEEA and the California IOUs further stated the energy use model in the June 2020 Preliminary Analysis only used the full- load energy EER of the compressors to calculate energy savings, meaning the analysis does not capture any inefficiencies due to single-speed compressor cycling at part load. (California IOUs, No. 23 at p. 2; NEEA, No. 24 at p. 5) The Joint Commenters noted that in addition to significantly reducing cycling losses, variable-speed operation improves heat exchanger effectiveness at reduced cooling loads, 
resulting in additional energy savings. (Joint Commenters, No. 20 at pp. 3–4) 
For this NOPR analysis, DOE 
modified its approach to calculating energy use for models that use a variable-speed compressor to account for the reduced energy consumption during part load operation. Unlike single-speed compressors, variable- speed compressors have the ability to operate at part load depending on the cooling load. The amount of the time 
spent in part load operation will depend on the local climate of the household or business operating the room AC. For example, room ACs in milder climates will spend more time in part load operation relative to a household in a hot climate where a compressor is likely to run at maximum load. DOE accounted for geographic-dependent climate variability by calculating U.S. State-dependent PAFs using historical climate data spanning the period from 2008–2016 from the National Oceanic and Atmospheric Administration.
32For 
each state in the U.S., DOE performed a temperature bin analysis to calculate within the cooling season (June through August) the fraction of time the outdoor dry bulb temperature was in one of four temperature bins: 80–84 degrees Fahrenheit (‘‘°F’’), 85–89 °F, 90–94 °F, 
and 95–99 °F. DOE then calculated the 
corresponding PAF for each state using the methodology developed for variable- speed drive units in the test procedure and applied the PAF to the EER at full load. DOE requests feedback on its approach to calculating the energy-use of variable-speed compressors and would welcome field metered data to further investigate the varying amounts of energy use due to single-speed and variable-speed units. 
Rice stated that the off-cycle energy 
use term in the June 2020 Preliminary Analysis energy-use model is inappropriate for a variable-speed room AC. Rice stated that it should be modified to account for lower standby energy usage due to longer run times in the cooling season for variable-speed units in meeting the cooling season load. Rice notes that since DOE’s calculation of energy use in cooling mode assumes operation at full rated cooling capacity, it is inappropriate for use in the standby energy use term for variable-speed room ACs. (Rice, No. 25 at p. 2) 
DOE’s test procedure requires that the 
low compressor speed at the low test condition achieve a capacity that is 47– 57 percent of the ‘‘peak’’ rated capacity. 
Therefore, DOE would not expect a variable-speed compressor unit to enter off-cycle mode above loads 47 percent of the rated capacity, which is close to a representative of outdoor temperature conditions of 82 °F. In this NOPR 
analysis, DOE calculates the energy use of variable-speed units using a geographic-dependent performance adjustment factor to account for time the unit spends at partial load. DOE is unaware of a data-set that would allow for the estimation of the change in cooling run time of variable-speed units relative to a single-speed unit. DOE welcomes any available information or data that can be used to improve assumptions in the energy use model. 
The California IOUs noted that DOE 
uses EER to estimate average annual energy use, however, only CEER is 
listed for each energy use results tables in chapter 7 of the preliminary TSD. To minimize confusion that CEER was used to calculate the average annual energy use, the California IOUs recommended that DOE add EER to energy use tables along with the corresponding CEER for each EL. (California IOUs, No. 23 at p. 3) 
DOE has included both EER and CEER 
in the energy use results tables in the NOPR TSD. 
Chapter 7 of the NOPR TSD provides 
details on DOE’s energy use analysis for room ACs. 
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 room ACs. 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: 
bThe LCC is the total consumer 
expense of an appliance or product over the life of that product, consisting of total installed cost (manufacturer selling price, distribution chain markups, sales tax, and installation costs) plus operating costs (expenses for energy use, maintenance, and repair). To compute the operating costs, DOE discounts future operating costs to the time of purchase and sums them over the lifetime of the product. 
bThe 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 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00024 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420631 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
33DOE will update all the 2015 RECS data to 
2020 RECS if it is available prior to the final rule. 
Similarly, DOE will update all 2012 CBECS data to 2018 CBECS when it becomes available. 34Crystal BallTMis 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/middleware/technologies/ 
crystalball.html (last accessed August 31, 2021). 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 room ACs in the absence of new or amended energy conservation standards. In contrast, the PBP for a given efficiency level is measured relative to the baseline product. 
For each considered efficiency level 
in each product class, DOE calculated the LCC and PBP for a nationally representative set of housing units and commercial buildings. As stated previously, DOE developed household samples from the 2015 RECS
33and 
commercial building samples from the 2012 CBECS. For each sample household or building, DOE determined the energy consumption for the room AC and the appropriate energy price. By developing a representative sample of households and commercial buildings, the analysis captured the variability in energy consumption and energy prices associated with the use of room ACs. 
Inputs to the calculation of total 
installed cost include the cost of the product—which includes MPCs, manufacturer markups, retailer and distributor markups, and sales taxes— and installation costs. Inputs to the calculation of operating expenses include annual energy consumption, energy prices and price projections, repair and maintenance costs, product lifetimes, and discount rates. DOE created distributions of values for product lifetime, discount rates, and sales taxes, with probabilities attached to each value, to account for their uncertainty and variability. 
The computer model DOE uses to 
calculate the LCC and PBP relies on a Monte Carlo simulation to incorporate uncertainty and variability into the analysis. The Monte Carlo simulations randomly sample input values from the probability distributions and room AC user samples. For this rulemaking, the Monte Carlo approach is implemented in MS Excel together with the Crystal Ball
TMadd-on.34The model calculated 
the LCC and PBP for products at each efficiency level for 10,000 housing units or commercial buildings per simulation run. The analytical results include a distribution of 10,000 data points showing the range of LCC savings for a given efficiency level relative to the no- new-standards case efficiency distribution. In performing an iteration of the Monte Carlo simulation for a given consumer, product efficiency is chosen based on its probability. If the chosen product efficiency is greater than or equal to the efficiency of the standard level under consideration, the LCC and PBP calculation reveals that a consumer is not impacted by the standard level. By accounting for consumers who already purchase more-efficient products, DOE avoids overstating the potential benefits from increasing product efficiency. 
DOE calculated the LCC and PBP for 
all consumers of room ACs as if each were to purchase a new product in the expected year of required compliance with new or amended standards. Amended standards would apply to room ACs manufactured 3 years after the date on which any new or amended standard is published. (42 U.S.C. (m)(4)(A)(i)) For purposes of its analysis, DOE used 2026 as the first year of compliance with any amended standards for room ACs. 
Table IV.3 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. 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00025 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.019</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table IV.3 Summarv of Inputs and Methods for the LCC and PBP Analysis* 
In nuts Source/Method 
Product Cost 
Installation Costs 
Annual Energy Use 
Energy Prices 
Energy Price Trends 
Repair and 
Maintenance Costs 
Product Lifetime 
Discount Rates 
Compliance Date 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. 
Assumed no change with efficiencv level. 
The total annual energy use by operating mode multiplied by the hours per 
year in each mode. 
Variability: Based on the 2015 RECS and 2012 CBECS. 
Electricity: Based on Edison Electric Institute data for 2020. 
Variabilitv: Regional energy prices determined for each Census Division. 
Based onAEO 2021 price projections by Census Division. 
Assumed no change with efficiency level for maintenance costs. Repair costs 
estimated for each product class and efficiencv level. 
Weibull probability distribution developed from historical shipments, 
American Housinz Survey and RECS, with an average lifetime of 9 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. 
2026 
* References for the data sources mentioned m this table are provided m the sections followmg the table or m chapter 8 
of the NOPR TSD. 20632 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
35Room air-conditioners and dehumidifiers, 
except portable dehumidifiers PPI series ID: 
PCU3334153334156; www.bls.gov/ppi/. 
36Air-conditioning, refrigeration, and forced air 
heating equipment manufacturing, Primary Products PPI series ID: PCU333415333415P; www.bls.gov/ppi/. 37Semiconductors and related device 
manufacturing PPI series ID: PCU334413334413; www.bls.gov/ppi/. 
38Ganeshalingam, M., Ni, C., and Yang, H-C. 
2021. A Retrospective Analysis of the 2011 Direct Final Rule for Room Air Conditioners. Lawrence Berkeley National Laboratory. LBNL-2001413. 39Edison Electric Institute. Typical Bills and 
Average Rates Report. 2020. Winter 2020, Summer 2020: Washington, DC. 1. Product Cost 
To calculate consumer product costs, 
DOE multiplied the MPCs developed in 
the engineering analysis by the markups described previously (along with sales taxes). DOE used different markups for baseline products and higher-efficiency products because DOE applies an incremental markup to the increase in MSP associated with higher-efficiency products. 
Economic literature and historical 
data suggest that the real costs of many products may trend downward over time according to ‘‘learning’’ or ‘‘experience’’ curves. Experience curve analysis implicitly includes factors such as efficiencies in labor, capital investment, automation, materials prices, distribution, and economies of scale at an industry-wide level. To derive the learning rate parameter for room ACs that utilize single-speed compressors, DOE obtained historical Producer Price Index (‘‘PPI’’) data for room ACs from the Bureau of Labor Statistics (‘‘BLS’’). A PPI specific to ‘‘room air-conditioners and dehumidifiers, except portable dehumidifiers’’ was available for the time period between 1990 and 2009.
35 
After 2009, PPI data was only available for the broader product family of ‘‘refrigeration and forced air heating equipment,’’ which includes room ACs, spanning the years 2010–2020.
36 
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. Using data from 1990–2020, the estimated learning rate (defined as the fractional reduction in price expected from each doubling of cumulative production) is 25 percent. 
The Joint Commenters suggested an 
analysis with learning rates associated with specific technology options or components. (Joint Commenters, No. 20 at pp. 4–5) 
DOE considered the inclusion of 
variable-speed compressors as a technology option in EL 4 and EL 5. To develop future prices specific for that technology, DOE applied a different price trend to the controls portion of the variable-speed compressors that contributes to the price increments moving from EL 3 (an efficiency level achieved with the highest efficiency single-speed compressor) to EL 4 and EL 5. DOE used PPI data on ‘‘semiconductors and related device manufacturing’’ between 1967 and 2020 to estimate the historic price trend of electronic components in the control.
37 
The regression performed as an exponential trend line fit results in an R-square of 0.99, with an annual price decline rate of 6.3 percent. See chapter 8 of the NOPR TSD for further details on this topic. 
The Joint Commenters noted that 
DOE’s estimate of the learning rate for room ACs is likely a conservative estimate of how prices will decline over time. (Joint Commenters, No. 20 at pp. 4–5) 
A retrospective analysis of the April 
2011 Direct Final Rule for room ACs
38 
compared the room AC average model- level price changes based on web- scraped retail price data from 2013 to 2017 (ex-post data) and the price factor index for the corresponding period derived in the April 2011 Direct Final Rule (ex-ante data). The result shows that the ex-ante data and ex-post data share similar price declining trends, and thus provide independent validation of the experience curve methodology adopted by DOE in the rulemaking analysis. To account for the uncertainties in the experience curve estimation, DOE also considered two alternative product price forecasts for room ACs (a high price decline and a low price decline scenarios and estimated their impacts on the consumer NPV for various standard levels (see section IV.H.3 of this document for details). 
DOE requests comments on its 
assumption and methodology for determining equipment price trends. 
2. Installation Cost 
Installation cost includes labor, 
overhead, and any miscellaneous 
materials and parts needed to install the product. As in the June 2020 Preliminary Analysis, DOE found no evidence that installation costs would be impacted with increased efficiency levels and, thus, did not include installation costs in the LCC calculation. 
3. Annual Energy Consumption 
For each sampled household or 
business, DOE determined the energy 
consumption for a room AC at different efficiency levels using the approach described previously in section IV.E of this document. 
a. Rebound Effect 
Higher-efficiency room ACs reduce 
the operating costs for a consumer, 
which can lead to greater use of room ACs. A direct rebound effect occurs when a product that is made more efficient is used more intensively, such that the expected energy savings from the efficiency improvement may not fully materialize. At the same time, consumers benefit from increased utilization of products due to rebound. Overall consumer welfare (taking into account additional costs and benefits) is generally understood to increase from rebound. DOE did not find any data on the rebound effect that is specific to room ACs. In the April 2011 Direct Final Rule, DOE estimated a rebound of 15 percent for room ACs for the NIA but did not include rebound in the LCC analysis. 76 FR 22454, 22511. Given the uncertainty and lack of data specific to room ACs, DOE did not include the rebound effect in the LCC analysis for this NOPR. DOE does include rebound in the NIA for a conservative estimate of national energy savings and the corresponding impact to consumer NPV. As in the April 2011 Direct Final Rule, DOE used a rebound effect of 15 percent for room ACs. See sections IV.H.2 and IV.H.3 of this document for further details on how the rebound effect is applied in the NIA. 
4. Energy Prices 
Because marginal electricity price 
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 prices. Therefore, DOE applied average electricity prices for the energy use of the product purchased at baseline efficiency, and marginal electricity prices for the incremental change in energy use associated with the other efficiency levels considered. 
DOE derived annual electricity prices 
in 2020 for each census division using data from EEI Typical Bills and Average Rates reports.
39For the residential 
sector, DOE used the EEI data to define a marginal price as the ratio of the change in the bill to the change in energy consumption. For the commercial sector, marginal prices depend on both the change in electricity consumption and the change in monthly 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00026 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420633 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
40Energy Information Administration. Annual 
Energy Outlook 2021 with Projections to 2050. 
Washington, DC. Available at www.eia.gov/ forecasts/aeo/. 41The 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. 
42U.S. Board of Governors of the Federal Reserve 
System. Survey of Consumer Finances. 1995, 1998, 2001, 2004, 2007, 2010, 2013, 2016, and 2019. (Last accessed August 20, 2021.) www.federalreserve.gov/ econresdata/scf/scfindex.htm. peak-coincident demand. DOE used the 
EEI data to estimate both marginal energy charges and marginal demand charges. 
DOE calculated weighted-average 
values for average and marginal price for the nine census divisions for both the residential and commercial sectors. As the EEI data are published separately for summer and winter, DOE calculated seasonal prices for each division and sector. See chapter 8 of the NOPR TSD for details. 
To estimate energy prices in future 
years, DOE multiplied the average regional energy prices by a projection of annual change in national-average residential and commercial energy price in AEO 2021.
40AEO 2021 has an end 
year of 2050. To estimate electricity price trends after 2050, DOE used the average annual rate of change in electricity price from 2035 through 2050. 
Rice suggested that consideration be 
given to showing energy cost information for both economy and cool mode settings to account for units with higher efficiency blower motor/fan assemblies that would have lower energy costs relative to less efficient blowers/fans in off-cycle mode. (Rice, No. 25 at p. 3) 
As described in section IV.E of this 
document, DOE includes the energy contribution of fan-mode including time spent in off-cycle mode. DOE determines energy costs for the full range of product classes and efficiency levels. 
5. Maintenance and Repair Costs 
Repair costs are associated with 
repairing or replacing product 
components that have failed in an appliance; maintenance costs are associated with maintaining the operation of the product. Typically, small incremental increases in product efficiency produce no, or only minor, changes in repair and maintenance costs compared to baseline efficiency products. In this NOPR analysis, DOE did not include maintenance costs in the LCC. 
In the June 2020 Preliminary 
Analysis, DOE assumed that repair frequencies are low and increase for the higher-capacity units due to more expensive equipment costs. DOE assumed that 1 percent of small-sized units (below 8,000 Btu/h), 2 percent of medium-sized units (8,000 to 20,000 Btu/h), and 3 percent of large-sized units (above 20,000 Btu/h) are 
maintained or repaired each year. DOE assumed that an average service call and repair/maintenance takes about 1 hour for small and medium-sized units and 2 hours for large units, and that the average material cost is equal to one-half of the incremental equipment cost. DOE maintains these assumptions in the NOPR analysis. 
6. Product Lifetime 
For room ACs, DOE developed a 
distribution of lifetimes from which 
specific values are assigned to the appliances in the samples. DOE conducted an analysis of actual lifetime in the field using a combination of historical shipments data, the stock of the considered appliances in the American Housing Survey, and responses in RECS on the age of the appliances in the homes. The data allowed DOE to estimate a survival function, which provides an average appliance lifetime. This analysis yielded a lifetime probability distribution with an average lifetime for room ACs of approximately 9 years. See chapter 8 of the NOPR TSD for further details. 
7. Discount Rates 
In the calculation of the LCC, DOE 
applies discount rates appropriate to 
residential and commercial sectors to estimate the present value of future operating costs. DOE estimated a distribution of residential and commercial discount rates for room ACs based on consumer financing costs and the opportunity cost of consumer funds (for the residential sector) and cost of capital of publicly traded firms (for the commercial sector). 
For households, DOE applies 
weighted-average discount rates calculated from consumer debt and asset data, rather than marginal or implicit discount rates.
41DOE notes that 
the LCC does not analyze the appliance purchase decision, so the implicit discount rate is not relevant in this model. The LCC 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, the application of a marginal interest rate associated with an initial source of 
funds is inaccurate. Regardless of the method of purchase, consumers are expected to continue to rebalance their debt and asset holdings over the LCC analysis period, based on the restrictions consumers face in their debt payment requirements and the relative size of the interest rates available on debts and assets. DOE estimates the aggregate impact of this rebalancing using the historical distribution of debts and assets. 
To establish residential discount rates 
for the LCC analysis, DOE identified all relevant household debt or asset classes in order to approximate a consumer’s opportunity cost of funds related to appliance energy cost savings. It estimated the average percentage shares of the various types of debt and equity by household income group using data from the Federal Reserve Board’s Survey of Consumer Finances
42(‘‘SCF’’) for 
1995, 1998, 2001, 2004, 2007, 2010, 2013, 2016, and 2019. Using the SCF and other sources, DOE developed a distribution of rates for each type of debt and asset by income group to represent the rates that may apply in the year in which amended standards would take effect. DOE assigned each sample household a specific discount rate drawn from one of the distributions. The average rate across all types of household debt and equity and income groups, weighted by the shares of each type, is 4.3 percent. See chapter 8 of the NOPR TSD for further details on the development of consumer discount rates. 
For commercial-sector room ACs, 
DOE used the cost of capital to estimate the present value of cash flows to be derived from a typical company project or investment. Most companies use both debt and equity capital to fund investments, so the cost of capital is the weighted-average cost to the firm of equity and debt financing. This corporate finance approach is referred to as the weighted-average cost of capital. DOE used currently available economic data in developing 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 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00027 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420634 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
43Ganeshalingam, M., Ni, C., and Yang, H-C. 
2021. A Retrospective Analysis of the 2011 Direct Final Rule for Room Air Conditioners. Lawrence 
Berkeley National Laboratory. LBNL-2001413. 44Bass, F. M. A New Product Growth Model for 
Consumer Durables. Management Science. 1969. 
15(5): pp. 215–227. case (i.e., the case without amended or 
new energy conservation standards). 
DOE utilized confidential 2019 
shipments data disaggregated by 
product class and efficiency provided by AHAM in response to the June 2020 Preliminary Analysis to estimate the efficiency distribution in 2019. In the preliminary analysis, DOE assumed an annual 0.25 percent increase in shipment-weighted CEER to develop the efficiency distribution in 2026. The efficiency trend used in this NOPR is 
supported by a retrospective analysis of the April 2011 Direct Final Rule which used a similar efficiency trend.
43For 
this NOPR, DOE assumed this trend applied to efficiency levels with single- speed compressors (EL 0, EL 1, EL 2, 
and EL 3). DOE assumed the adoption of variable-speed technologies (EL 4 and EL 5) would follow a Bass diffusion curve which describes how new technologies diffuse into the consumer market.
44DOE assumed that shipments 
to variable-speed technologies would account for 5 percent of shipments in each product class by 2026. The estimated market shares for the no-new- standards case for room ACs in 2026 are shown in Table IV.4 through Table IV.6 of this document. See chapter 8 of the NOPR TSD for further information on the derivation of the efficiency distributions. 
BILLING CODE 6450–01–P 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00028 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.020</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table IV.4 Room Air Conditioners without Reverse Cycle and with Louvered Sides: 
No-New-Standards Case Market Shares in 2026 
<6,000 Btu/h (PCl) 6,000-7,999 Btu/h 8,000-13,999 Btu/h 
(PC2) (PC3) Efficiency Efficiency Efficiency Efficiency Market Level Market Market Share CEER Share% CEER Share% CEER % 
Baseline 11.0 7.7% 11.0 0.0% 10.9 0.0% 
1 11.4 85.2% 11.4 74.6% 11.4 31.1% 
2 12.1 2.1% 12.1 18.3% 12.0 63.0% 
3 13.1 0.0% 13.7 2.1% 14.3 0.9% 
4 16.0 5.0% 16.0 5.0% 16.0 5.0% 
5 20.2 0.0% 20.2 0.0% 22.4 0.0% 
14,000-19,999 Btu/h 20,000-27,999 Btu/h >=28,000 Btu/h 
Efficiency (PC4) (PC5a) (PC5b) 
Efficiency Efficiency Efficiency Market Level Market Market 
Share% Share% Share CEER CEER CEER % 
Baseline 10.7 0.0% 9.4 0.0% 9.0 40.3% 
1 11.1 0.0% 9.8 8.7% 9.4 45.7% 
2 11.8 94.7% 10.3 86.2% 9.9 9.0% 
3 14.0 0.3% 11.8 0.0% 10.3 0.0% 
4 16.0 5.0% 13.8 5.0% 13.2 5.0% 
5 20.6 0.0% 19.1 0.0% 16.7 0.0% 20635 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
BILLING CODE 6450–01–C 
DOE requests feedback on its 
approach to projecting the efficiency 
distribution in 2026. 
9. Payback Period Analysis 
The payback period is the amount of 
time it takes the consumer to recover the 
additional installed cost of more- efficient products, compared to baseline products, through energy cost savings. Payback periods are expressed in years. Payback periods that exceed the life of the product mean that the increased total installed cost is not recovered in reduced operating expenses. The inputs to the PBP calculation for 
each efficiency level are the change in total installed cost of the product and the change in the first-year annual operating expenditures relative to the baseline. The PBP calculation uses the same inputs as the LCC analysis, except that discount rates are not needed. 
As noted previously, EPCA 
establishes a rebuttable presumption that a standard is economically justified if the Secretary finds that the additional cost to the consumer of purchasing a product complying with an energy conservation standard level will be less than three times the value of the first year’s energy savings resulting from the 
standard, as calculated under the applicable test procedure. (42 U.S.C. 6295(o)(2)(B)(iii)) For each considered efficiency level, DOE determined the value of the first year’s energy savings by calculating the energy savings in accordance with the applicable DOE test procedure, and multiplying those savings by the average energy price projection for the year in which compliance with the amended standards would be required. 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00029 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.021</GPH> EP07AP22.022</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table IV.5 Room Air Conditioners without Reverse Cycle and without Louvered 
Sides: No-New-Standards Case Market Shares in 2026 
8,000-10,999 Btu/h 11,000-13,999 Btu/h 14,000-19,999 
Efficiency (PC Sa) (PC8b) Btu/h (PC9) 
Level 
Efficiency Market Efficiency Market Efficiency Market 
Share Share Share 
CEER % CEER % CEER % 
Baseline 9.6 0.0% 9.50 0.0% 9.3 39.1% 
1 10.1 11.4% 10.00 0.0% 9.7 46.9% 
2 10.6 83.6% 10.50 94.3% 10.2 9.0% 
3 12.3 0.0% 12.32 0.7% 10.9 0.0% 
4 14.1 5.0% 12.80 5.0% 13.7 5.0% 
5 18.7 0.0% 19.09 0.0% 16.6 0.0% 
Table IV.6 Room Air Conditioners with Reverse Cycle, Casement-Slider: No-New­
Standards Case Market Shares in 2026 
w/Louvers (PCll) wo/ Louvers (PC12) Casement-Slider 
Efficiency (PC16) 
Level <20,000 Btu/h <14,000 Btu/h 
Efficiency Market Efficiency Market Efficiency Market 
CEER Share% CEER Share CEER Share 
% % 
Baseline 9.8 50.7% 9.3 39.1% 10.4 34.4% 
1 10.4 35.2% 9.7 46.9% 10.8 51.6% 
2 10.8 9.0% 10.2 9.0% 11.4 9.0% 
3 12.3 0.0% 11.3 0.0% 13.2 0.0% 
4 14.4 5.0% 13.7 5.0% 15.3 5.0% 
5 18.7 0.0% 16.2 0.0% 19.7 0.0% 20636 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
45DOE 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. 
46Fujita, K. (2015) Estimating Price Elasticity 
using Market-Level Appliance Data. Lawrence Berkeley National Laboratory, LBNL–188289. 47Ganeshalingam, M., Ni, C., and Yang, H-C. 
2021. A Retrospective Analysis of the 2011 Direct Final Rule for Room Air Conditioners. Lawrence Berkeley National Laboratory. LBNL-2001413. 
48The NIA accounts for impacts in the 50 states. G. Shipments Analysis 
DOE uses projections of annual 
product shipments to calculate the 
national impacts of potential amended or new energy conservation standards on energy use, NPV, and future manufacturer cash flows.
45The 
shipments model takes an accounting approach, tracking market shares of each product class and the vintage of units in the stock. Stock accounting uses product shipments as inputs to estimate the age distribution of in-service product stocks for all years. The age distribution of in-service product stocks is a key input to calculations of both the NES and NPV, because operating costs for any year depend on the age distribution of the stock. 
Total shipments for room ACs are 
developed by considering the demand from replacements for units in stock that fail and the demand from first-time owners in existing households. DOE calculated shipments due to replacements using the retirement function developed for the LCC analysis. DOE calculated shipments due to first-time owners in existing households using estimates from room AC saturation in RECS 2015 and projections of housing stock from AEO 2021. See chapter 8 of the NOPR TSD 
for details. 
DOE considers the impacts on 
shipments from changes in product purchase price and operating cost associated with higher energy efficiency levels using a price elasticity and an efficiency elasticity. As in the June 2020 Preliminary Analysis, DOE employs a 0.2-percent efficiency elasticity rate and a price elasticity of ¥0.45 in its shipments model. These values are based on analysis of aggregated data for five residential appliances including room ACs.
46The market impact is 
defined as the difference between the product of price elasticity of demand and the change in price due to a standard level, and the product of the efficiency elasticity and the change in operating costs due to a standard level. 
ASAP and the Joint Commenters 
noted that the efficiency elasticity was omitted from chapter 9 of the preliminary TSD. (ASAP, Public Meeting Transcript, No. 18 at pp. 94–95; Joint Commenters, No. 20 at p. 5) ASAP and the Joint Commenters encouraged DOE to confirm and clarify whether the efficiency elasticity is considered in calculating the standards-case shipments. (Joint Commenters, No. 20 at p. 5) 
Chapter 9 of the NOPR TSD has been 
updated to display the impact of the price and efficiency elasticity in calculating the standards-case shipments. 
AHAM recommended that DOE do as 
it generally does and rely on shipment- weighted data in its analysis and provided DOE data for 2019 shipments by product class. (AHAM, No. 19 at p. 9) 
DOE appreciates the 2019 shipments 
by product class and efficiency level provided by AHAM and has updated the NOPR to reflect the AHAM data. 
NEEA noted that DOE’s shipment 
projections are likely low and do not follow the market’s historical trends— DOE’s analysis showed a very small growth in annual shipments through 2052 to a peak of approximately 8.5 million units per year. NEEA stated that this slow growth trend does not match the historic growth seen in the room AC market. For the number of replacement units, NEEA recommended that DOE amend its analysis to consider early retirement of units driven by new features, such as increased efficiency and smart rooms ACs, which could increase the number of shipments. For new units, NEEA recommended that DOE consider an increasing market penetration factor to account for the growth of room AC use in climates where cooling has not been needed traditionally. (NEEA, No. 24 at pp. 5–6) 
DOE notes that between 2014 and 
2019, room AC shipments have been approximately 7 million units with no clear indication of steady growth over that period. DOE determines the replacement market from lifetime estimates of room ACs. Early retirement of units to purchase more efficient and/ or units with additional features are currently accounted for in the lifetime distribution. A retrospective analysis of the April 2011 Direct Final Rule for room ACs,
47which also accounted for 
shipments due to replacements and first-time owners, generally found that DOE projections matched with AHAM shipments data in 2017 and 2018. DOE acknowledges that a warming climate could increase purchase of room ACs in climates where cooling has not been needed traditionally, but it is not aware of any data that would facilitate an accurate estimate of this future demand. DOE welcomes shipments data that 
include markets in addition to replacement and first-time user markets. 
Chapter 9 of the NOPR TSD provides 
additional details on the shipments analysis. 
DOE requests comment on its general 
methodology for estimating shipments. 
H. National Impact Analysis 
The NIA assesses the NES and the 
NPV from a national perspective of total 
consumer costs and savings that would be expected to result from new or amended standards at specific efficiency levels.
48(‘‘Consumer’’ in this context 
refers to consumers of the product being regulated.) DOE calculates the NES and NPV for the potential standard levels considered based on projections of annual product shipments, along with the annual energy consumption and total installed cost data from the energy use and LCC analyses. For the present analysis, DOE projected the energy savings, operating cost savings, product 
costs, and NPV of consumer benefits over the lifetime of room ACs sold from 2026 through 2055. 
DOE evaluates the impacts of new or 
amended standards by comparing a case without such standards with standards- case projections. The no-new-standards case characterizes energy use and consumer costs for each product class in the absence of new or amended energy conservation standards. For this projection, DOE considers historical trends in efficiency and various forces that are likely to affect the mix of efficiencies over time. DOE compares the no-new-standards case with projections characterizing the market for each product class if DOE adopted new or amended standards at specific energy efficiency levels (i.e., the TSLs or 
standards cases) for that class. For the standards cases, DOE considers how a given standard would likely affect the market shares of products with efficiencies greater than the standard. 
DOE uses a spreadsheet model to 
calculate the energy savings and the national consumer costs and savings from each TSL. Interested parties can review DOE’s analyses by changing various input quantities within the spreadsheet. The NIA spreadsheet model uses typical values (as opposed to probability distributions) as inputs. 
Table IV.7 summarizes the inputs and 
methods DOE used for the NIA analysis for the NOPR. Discussion of these inputs and methods follows the table. 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00030 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420637 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
49Ganeshalingam, M., Ni, C., and Yang, H-C. 
2021. A Retrospective Analysis of the 2011 Direct 
Final Rule for Room Air Conditioners. Lawrence Berkeley National Laboratory. LBNL–2001413. See chapter 10 of the NOPR TSD for 
further details. 
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.7 of this document describes how DOE developed an energy efficiency distribution for the no-new-standards case (which yields a shipment-weighted average efficiency) for each of the considered product classes for the year of anticipated compliance with an amended or new standard. To project the trend in efficiency absent amended standards for room ACs over the entire shipments projection period, DOE assumed that market share for ELs with variable-speed technologies would follow a Bass diffusion curve, while the shipment-weighted CEER for ELs with single-speed compressors would increase annually by 0.25 percent in CEER based on historical trends in shipment-weighted efficiency.
49The 
approach is further described in chapter 10 of the NOPR TSD. 
In its reference scenario, DOE 
assumed that variable-speed technologies would comprise 25 percent of the market by the end of the analysis period (2055). DOE also performed sensitivity scenarios assuming a low penetration of variable-speed 
technologies (10 percent of the market in 2055) and a high penetration of variable-speed technologies (50 percent of the market in 2055). The results of these scenarios can be found in appendix 10E of the NOPR TSD. DOE requests comment on its approach to projecting market share for variable- speed technologies over the course of the analysis period. 
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 in 2026. In the year of 
compliance, the market shares of products in the no-new-standards case that do not meet the standard under consideration would ‘‘roll up’’ to the minimum EL that meets the standard, and the market share of products above the standard would remain unchanged. As in the no-new-standards case, DOE assumed an annual increase of 0.25 percent in CEER over the analysis period for ELs with single-speed technology. 
The Joint Commenters noted that data 
on sales over the past decade suggest that the ‘‘roll-up’’ scenario considered by DOE may underestimate the savings from amended standards and suggested DOE consider reevaluating the use of the ‘‘roll-up’’ scenario for estimating the market distribution of each efficiency level following the adoption of a standard. (Joint Commenters, No. 20 at 
p. 5) 
DOE acknowledges multiple drivers 
in the room AC market, one of which is 
the amended standard process. Although DOE uses a roll-up to allocate market share by efficiency level in the year a standard is enacted, an efficiency trend is applied in subsequent years in the standards case to account for the observed historical trends in efficiency. See chapter 10 of the NOPR TSD for details. 
2. National Energy Savings 
The national energy savings analysis 
involves a comparison of national 
energy consumption of the considered products between each potential standards case (TSL) and the case with no new or amended energy conservation standards. DOE calculated the national energy consumption by multiplying the number of units (stock) of each product (by vintage or age) by the unit energy consumption (also by vintage). DOE calculated annual NES based on the difference in national energy consumption for the no-new standards case and for each higher efficiency standard case. DOE estimated energy consumption and savings based on site energy and converted the electricity consumption and savings to primary energy (i.e., the energy consumed by 
power plants to generate site electricity) using annual conversion factors derived 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00031 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.023</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4T bl IV 7 S a e . ummary o fl nputs an et o s or t e at10na dM h d f h N . I I mpact A I na1ys1s 
Inouts Method 
Shipments Annual shipments from shipments model. 
Compliance Date of Standard 2026 
Bass diffusion curve to allocate shipments to ELs with 
Efficiency Trends variable-speed technology and annual 0.25% increase in 
shipment-weighted CEER for ELs with single-speed 
technology. 
Annual Energy Consumption per Unit Calculated for each efficiency level based on inputs from 
energy use analysis. 
Total Installed Cost per Unit Calculated for each efficiency level based on inputs from the 
LCC analysis. 
Repair and Maintenance Cost per Unit Calculated for each efficiency level on inputs from the LCC 
analysis. 
Electricity Price Estimated average and marginal electricity prices from the 
LCC analysis based on EEi data. 
Electricity Price Trends AEO 2021 projections (to 2050) and extrapolation using a fixed 
annual rate of price change between 2035 and 2050 thereafter. 
Energy Site-to-Primary and FFC A time-series conversion factor based onAEO 2021. Conversion 
Discount Rate 3 percent and 7 percent 
Present Year 2021 20638 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
50Sorrell, S., J. Dimitropoulos, M. Sommerville. 
2009. Empirical estimates of the direct rebound 
effect: A review. Energy Policy 37 (2009) 1356– 1371. 
51For more information on NEMS, refer to The 
National Energy Modeling System: An Overview 2009, DOE/EIA–0581(2009), October 2009. 
Available at www.eia.gov/forecasts/aeo/index.cfm. 52United States Office of Management and 
Budget. Circular A–4: Regulatory Analysis. from AEO 2021. Cumulative energy 
savings are the sum of the NES for each 
year over the timeframe of the analysis. 
Use of higher-efficiency products is 
occasionally associated with a direct rebound effect, which refers to an increase in utilization of the product due to the reduction in operating cost induced by improved efficiency. A direct rebound effect occurs when a product that is made more efficient is used more intensively, reducing expected energy savings from the efficiency improvement. At the same time, consumers can benefit from increased utilization of products due to the direct rebound effect. DOE did not find any data on the rebound effect specific to room ACs, but it applied a rebound effect of 15 percent as suggested by Sorrell et al.
50and was 
done in the April 2011 Direct Final Rule. The calculated NES at each efficiency level is therefore reduced by 15 percent. DOE also included the rebound effect in the NPV analysis accounting for the additional net benefit from increased room AC usage as described in section IV.H.3 of this document. 
In 2011, in response to the 
recommendations of a committee on 
‘‘Point-of-Use and Full-Fuel-Cycle Measurement Approaches to Energy Efficiency Standards’’ appointed by the National Academy of Sciences, DOE announced its intention to use FFC measures of energy use and greenhouse gas and other emissions in the national impact analyses and emissions analyses included in future energy conservation standards rulemakings. 76 FR 51281 (Aug. 18, 2011). After evaluating the approaches discussed in the August 18, 2011 notice, DOE published a statement of amended policy in which DOE explained its determination that EIA’s National Energy Modeling System (‘‘NEMS’’) is the most appropriate tool for its FFC analysis and its intention to use NEMS for that purpose. 77 FR 49701 (Aug. 17, 2012). NEMS is a public domain, multi-sector, partial equilibrium model of the U.S. energy sector
51that EIA uses to prepare its 
Annual Energy Outlook. The FFC factors incorporate losses in production and delivery in the case of natural gas (including fugitive emissions) and additional energy used to produce and deliver the various fuels used by power plants. The approach used for deriving 
FFC measures of energy use and emissions is described in appendix 10B of the NOPR TSD. 
EEI suggested incorporating the AEO 
full-fuel-cycle conversion for DOE’s next update. (EEI, Public Meeting Transcript, No. 18 at pp. 83–84) 
For this NOPR analysis, DOE reports 
the full-fuel-cycle energy savings in its NIA using inputs from AEO 2021. See chapter 10 of the NOPR TSD for a full description. 
3. Net Present Value Analysis 
The inputs for determining the NPV 
of the total costs and benefits 
experienced by consumers are (1) total annual installed cost, (2) total annual operating costs (energy costs and repair and maintenance costs), and (3) a discount factor to calculate the present value of costs and savings. DOE calculates net savings each year as the difference between the no-new- standards case and each standards case in terms of total savings in operating costs versus total increases in installed costs. DOE calculates operating cost savings over the lifetime of each product shipped during the projection period. 
As discussed in section IV.F.6 of this 
document, DOE developed room AC 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 2055, the end date of the analysis period, the average single-speed compressor room AC price is projected to drop 23 percent and the variable- speed compressor room AC price is projected to drop about 37 percent relative to 2020. DOE’s projection of product prices is described in appendix 10C of the NOPR TSD. 
To evaluate the effect of uncertainty 
regarding the price trend estimates, DOE investigated the impact of alternate product price projections on the consumer NPV for the considered TSLs for room ACs. In addition to the default price trend, DOE considered high and low product price sensitivity cases. In the high price scenario, DOE based the price decline of the non-variable speed controls portion on room AC PPI data limited to the period between the period 1990–2009, which shows a faster price decline relative to the full time series. For the variable-speed controls portion, DOE used a faster price decline derived from the lower bound of the 95 percent confidence interval fitting PPI data for semiconductors. In the low price decline scenario, DOE assumed a constant price for the non-variable- speed controls portion of the price and a slower price decline estimate for the variable-speed controls portion derived 
from the upper bound of the 95 percent confidence interval fitting PPI data for semiconductors over the analysis period. The derivation of these price trends and the results of these sensitivity cases are described in appendix 10C of the NOPR TSD. The operating cost savings are energy cost savings, which are calculated using the estimated energy savings in each year and the projected price of electricity. To estimate energy prices in future years, DOE multiplied the average regional energy prices by the projection of annual national-average residential and commercial energy price changes in the Reference case from AEO 2021, which has an end year of 2050. For the years after 2050, DOE used the average annual rate of change in electricity price from 2035 through 2050. As part of the NIA, DOE also analyzed scenarios that used inputs from variants of the AEO 2021 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. 
As described in section IV.H.2 of this 
document, DOE assumed a 15 percent rebound from an increase in utilization of the product arising from the increase in efficiency (i.e., the direct rebound 
effect). In considering the consumer 
welfare gained due to the direct rebound effect, DOE accounted for change in consumer surplus attributed to additional cooling from the purchase of a more efficient unit. Overall consumer welfare is generally understood to be enhanced from rebound. The net consumer impact of the rebound effect is included in the calculation of operating cost savings in the consumer NPV results. See appendix 10F of the NOPR TSD for details on DOE’s treatment of the monetary valuation of the rebound effect. DOE requests comments on its approach to monetizing the impact of the rebound effect. 
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.
52The discount rates 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00032 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420639 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
September 17, 2003. Section E. Available at obama
whitehouse.archives.gov/omb/circulars _a004_ a-4/ 
(last accessed June 15, 2021). 53www.sec.gov/edgar/searchedgar/ 
companysearch.html. 
54www.census.gov/programs-surveys/qpc/data/ 
tables.html. 
55app.dnbhoovers.com. for the determination of NPV are in 
contrast to the discount rates used in the LCC analysis, which are designed to reflect a consumer’s perspective. The 7- percent real value is an estimate of the average before-tax rate of return to private capital in the U.S. economy. The 3-percent real value represents the ‘‘social rate of time preference,’’ which is the rate at which society discounts future consumption flows to their present value. 
I. Consumer Subgroup Analysis 
In analyzing the potential impact of 
new or amended energy conservation 
standards on consumers, DOE evaluates the impact on identifiable subgroups of consumers that may be disproportionately affected by a new or amended national standard. The purpose of a subgroup analysis is to determine the extent of any such disproportional impacts. DOE evaluates impacts on particular subgroups of consumers by analyzing the LCC impacts and PBP for those particular consumers from alternative standard levels. For this NOPR, DOE analyzed the impacts of the considered standard levels on two subgroups: (1) Low- income households and (2) senior-only households. The analysis used subsets of the 2015 RECS sample composed of households that meet the criteria for the two subgroups and shows the percentages of those both negatively and positively impacted. DOE used the LCC and PBP spreadsheet model to estimate the impacts of the considered efficiency levels on these subgroups for product classes with a sufficient sample size in 2015 RECS to perform a Monte Carlo analysis. Chapter 11 of the NOPR TSD describes the consumer subgroup analysis. 
J. Manufacturer Impact Analysis 1. Overview 
DOE performed a MIA to estimate the 
impacts of amended energy 
conservation standards on manufacturers of room ACs. The MIA has both quantitative and qualitative aspects and includes analyses of projected industry cash flows, the INPV, investments in research and development (‘‘R&D’’) and manufacturing capital, and domestic manufacturing employment. Additionally, the MIA seeks to determine how amended energy conservation standards might affect manufacturing capacity and competition, as well as how standards contribute to overall regulatory burden. Finally, the MIA serves to identify any disproportionate impacts on manufacturer subgroups, including small business manufacturers. 
The quantitative part of the MIA 
primarily relies on the Government Regulatory Impact Model (‘‘GRIM’’), an industry cash flow model with inputs specific to this rulemaking. The key GRIM inputs include data on the industry cost structure, unit production costs, product shipments, manufacturer markups, and investments in R&D and manufacturing capital required to produce compliant products. The key GRIM outputs are the INPV, which is the sum of industry annual cash flows over the analysis period, discounted using the industry-weighted average cost of capital, and the impact to domestic manufacturing employment. The model uses standard accounting principles to estimate the impacts of more-stringent energy conservation standards on a given industry by comparing changes in INPV and domestic manufacturing employment between a no-new-standards case and the various standards cases (TSLs). To capture the uncertainty relating to manufacturer pricing strategies following amended standards, the GRIM estimates a range of possible impacts under different manufacturer markup scenarios. 
The qualitative part of the MIA 
addresses manufacturer characteristics and market trends. Specifically, the MIA considers such factors as a potential standard’s impact on manufacturing capacity, competition within the industry, the cumulative impact of other Federal product-specific regulations, and impacts on manufacturer subgroups. The complete MIA is outlined in chapter 12 of the NOPR TSD. 
DOE conducted the MIA for this 
proposed rulemaking in three phases. In Phase 1 of the MIA, DOE prepared a profile of the room AC manufacturing industry based on publicly available data and information from its market and technology assessment, engineering analysis, and shipments analysis. This preparation included a top-down analysis of room AC manufacturers that DOE used to derive preliminary financial parameters for the GRIM (e.g., 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 room AC manufacturing industry, including company filings of form 10– K from the SEC,
53corporate annual 
reports, the April 2011 Direct Final Rule, and the U.S. Census Bureau’s Economic Census.
54DOE also relied on 
subscription-based resources such as reports from Dun & Bradstreet.
55 
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 room ACs in order to develop other key GRIM inputs, including product and capital conversion costs, and to gather additional information on the anticipated effects of energy conservation standards on revenues, direct employment, capital assets, industry competitiveness, and subgroup impacts. 
In Phase 3 of the MIA, DOE 
conducted structured, detailed interviews with representative manufacturers. During these interviews, DOE discussed engineering, manufacturing, procurement, and financial topics to validate assumptions used in the GRIM and to identify key issues or concerns. See section IV.J.3 of this document for a description of the key issues raised by manufacturers during the interviews. As part of Phase 3, DOE also evaluated subgroups of manufacturers that may be disproportionately impacted by amended standards or that may not be accurately represented by the average cost assumptions used to develop the industry cash flow analysis. Such manufacturer subgroups may include small business manufacturers, low- volume manufacturers, niche players, and/or manufacturers exhibiting a cost structure that largely differs from the 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00033 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420640 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
industry average. DOE identified one 
subgroup for a separate impact analysis: Small business manufacturers. The small business subgroup is discussed in section VII.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, 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 2021 (the base year of the MIA analysis) and continuing to 2055. DOE calculated INPVs by summing the stream of annual discounted cash flows during this period. For manufacturers of room ACs, DOE used a real discount rate of 7.2 percent, which was derived from public financial data 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 information gathered during the course of manufacturer interviews. The GRIM results are presented in section V.B.2 of this document. Additional details about the GRIM, the discount rate, and other financial parameters can be found in chapter 12 of the NOPR TSD. 
a. Manufacturer Production Costs 
Manufacturing more efficient 
equipment is typically more expensive 
than manufacturing baseline equipment due to the use of more complex components, which are typically more costly than baseline components. The changes in the MPCs of covered products can affect the revenues, gross margins, and cash flow of the industry. DOE models the relationship between efficiency and MPCs as a part of its engineering analysis. For a complete 
description of the MPCs, see chapter 5 of the NOPR TSD. 
b. Shipments Projections 
The GRIM estimates manufacturer 
revenues based on total unit shipment 
projections and the distribution of those shipments by product class and 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. See chapter 9 of the NOPR TSD for additional details on DOE’s shipments projections. 
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) Product 
conversion costs, and (2) capital conversion costs. 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. 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. 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. 
To calculate the MPCs for room ACs 
at and above the baseline, DOE performed teardowns for representative units. The data generated from these analyses were then used to estimate the capital investments in equipment, tooling, and conveyor required of original equipment manufacturers (‘‘OEMs’’) at each efficiency level, taking into account such factors as product design, raw materials, purchased components, and fabrication method. Changes in equipment, tooling, and conveyer were used to estimate capital conversion costs. Additionally, capital conversion costs accounted for investments in appearance tooling made by manufacturers that are not OEMs. 
DOE relied on feedback from industry 
to evaluate the product conversion costs industry would likely incur at the 
considered standard levels. DOE integrated feedback from manufacturers, both OEM and non-OEM, on redesign effort and staffing to estimate product conversion cost. Manufacturer numbers were aggregated to protect confidential information. 
The conversion cost figures used in 
the GRIM can be found in section V.B.2 of this document. For additional information on the 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 non-production cost markups to the MPCs estimated in the engineering analysis for each product class and efficiency level. Modifying these markups in the standards case yields different sets of impacts on manufacturers. For the MIA, DOE modeled two standards-case manufacturer markup scenarios to represent uncertainty regarding the potential impacts on prices and profitability for manufacturers following the implementation of amended energy conservation standards: (1) A preservation of gross margin percentage markup scenario, and (2) a preservation of per-unit operating profit markup scenario. These scenarios lead to different manufacturer markup values that, when applied to the MPCs, result in varying revenue and cash flow impacts. 
Under the preservation of gross 
margin percentage scenario, DOE applied a single uniform ‘‘gross margin percentage’’ markup 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 absolute dollar markup will increase as well. DOE assumed the industry-average manufacturer markup—which includes SG&A expenses, R&D expenses, interest, and profit—to be 1.26 for room ACs. Manufacturers tend to believe it is optimistic to assume that they would be able to maintain the same gross margin percentage markup as their production costs increase, particularly for minimally efficient products. Therefore, DOE assumes that this scenario represents a high bound to industry 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00034 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420641 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
56For the June 2020 Preliminary Analysis, DOE 
analyzed five efficiency levels as part of its 
engineering analysis. In response to stakeholder comments to the preliminary analysis, DOE analyzed an additional efficiency level in the NOPR engineering analysis between EL 3 and the max- tech level (EL 4 in the preliminary analysis, now EL 5 for this NOPR). 
57The Office of the United States Trade 
Representative (‘‘USTR’’) released a list of Chinese imports subject to new tariffs on September 18, 
Continued 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 markups to a level that maintains base-case operating profit. DOE implemented this scenario in the GRIM by lowering the manufacturer markups at each TSL to yield approximately the same earnings before interest and taxes in the standards case as in the no-new-standards case in the year after the compliance date of the amended standards. The implicit assumption behind this manufacturer markup scenario is that the industry can only maintain its operating profit in absolute dollars after the standard. A comparison of industry financial impacts under the two markup scenarios is presented in section V.B.2.a of this document. 
3. Manufacturer Interviews 
DOE interviewed manufacturers 
representing approximately 40 percent 
of the basic models in DOE’s Compliance Certification Database (‘‘CCD’’). Participants included OEMs and importers. 
In interviews, DOE asked 
manufacturers to describe their major concerns regarding potential increases in energy conservation standards for room ACs. 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. Compressor Availability 
For the June 2020 Preliminary 
Analysis, DOE selected EL 3 levels to 
represent an intermediate efficiency between EL 2 (the ENERGY STAR level) and EL 4 (the max-tech level)
56that 
could be reached with single-speed compressor designs for all product classes. 85 FR 36512. In interviews, manufacturers raised concerns about the ability to meet the preliminary analysis’ CEER values at EL 3 without the use of variable-speed compressors. 
Manufacturers asserted that the single- speed compressors necessary to meet the preliminary analysis EL 3 levels are not available to all manufacturers and 
encouraged DOE to base EL 3 on compressors that are widely available on the market. 
b. Physical Design Constraints 
Manufacturers noted that through-the- 
wall (‘‘TTW’’) products are designed to 
fit specific sleeve sizes and the market requires replacement products to fit existing sleeves. Additionally, window units are constrained by average window dimensions. Further, manufacturers noted that they design the boxed product to meet either 50 pound (‘‘lb’’) or 150 lb weight thresholds, reflecting requirements related to worker safety standards, parcel delivery service thresholds, and customer utility. Manufacturers noted that maintaining existing product dimensions is an important feature to their end-users, particularly in the replacement market. 
c. Cost Increases and Component 
Shortages 
Manufacturers noted that recent 
increases in raw material prices, escalating shipping and transportation costs, and limited component availability all affect manufacturer production costs. As a result, cost estimates based on historic 5-year averages would underestimate current production costs. 
4. Discussion of MIA Comments 
In response to the June 2020 
Preliminary Analysis, interested parties 
submitted written comments addressing several topics including cumulative regulatory burden. 
AHAM and GEA commented that 
DOE should include proposed changes to both standards and refrigerants, as well as the economic impact of U.S. tariffs on Chinese imports, when determining the cumulative regulatory burden placed on manufacturers. AHAM and GEA also urged DOE to incorporate the financial results of cumulative regulatory burden analysis into the GRIM to account for the time and resources needed to comply with concurrent regulations. (AHAM, No. 19 at pp. 12 and 17–19; GEA No. 26 at p. 2) 
DOE analyzes cumulative regulatory 
burden pursuant to 10 CFR part 430, subpart C, appendix A. Pursuant to appendix A, the Department will recognize and consider the overlapping effects on manufacturers of new or revised DOE standards and other Federal regulatory actions affecting the same products or equipment. The results of this analysis can be found in section V.B.2.e of this document. DOE endeavors to provide analyses that take market conditions and the effect of other Federal regulatory actions into account, such as the U.S. tariffs on Chinese imports and the transition to alternative refrigerants. DOE incorporates these factors into their range of analyses, including the market and technology assessment, screening analysis, engineering analysis, energy usage analysis, NIA, and MIA. 
In consideration of AHAM’s comment 
on the possibility that California may prohibit HFCs and the resulting transition to alternative refrigerants (AHAM, No. 40 at p. 12), DOE evaluated potential impacts of CARB’s proposed 750 GWP limit on the energy efficiency of new room ACs. This State regulation is specific to the products regulated by this NOPR and would require redesign of the covered product. Based on interviews and through review of market data, DOE found that all but one OEM is producing R–32 room AC models. Additionally, based on interview feedback, all OEMs intend to transition entirely to R–32 room ACs by 2023 regardless of DOE actions related to the energy conservation standards for room ACs. Thus, DOE did not consider the redesign costs related to R–32 to be conversion costs, as the change in refrigerant is independent of DOE actions related to any amended energy conservation standards. 
DOE is aware of one OEM still in the 
process of redesigning room ACs to make use of R–32 and to comply with the requirements in Underwriters Laboratories (‘‘UL’’) Standard UL 60335–2–40, ‘‘Household and Similar Electrical Appliances—Safety—Part 2– 40: Particular Requirements for Electrical Heat Pumps, Air-Conditioners and Dehumidifiers’’ (‘‘UL 60335–2–40’’) for their products that are manufactured in-house. To account for these investments, DOE incorporated an estimate of the on-going costs for that business into its GRIM. 
Regarding U.S. tariffs on Chinese 
imports, tariff levels have escalated in recent years. At the time of the April 2011 Direct Final Rule, most room ACs imported into the U.S. were manufactured in China. Since that time, the Section 301 tariffs on room ACs increased to 10 percent in September 2018 and to 25 percent in May 2019.
57 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00035 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420642 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
2018. The tariffs were set at 10 percent and had an 
effective date of September 24, 2018. Room ACs fall under Harmonized Tariffs Schedule (‘‘HTS’’) code 8415.10.30, ‘‘Window or wall type air conditioning machines, self-contained,’’ and were subject to those tariffs. The USTR press release on the adoption of the tariffs and the affected imports can be found at: ustr.gov/about-us/policy-offices/press- office/press-releases/2018/september/ustr-finalizes- tariffs-200. The Notice of Modification of Section 
301 can be found at: ustr.gov/sites/default/files/ enforcement/301Investigations/ 83%20FR%2047974.pdf. 
Initially, the tariffs on room ACs were set to 
increase to 25 percent on January 1, 2019. The increase was delayed in subsequent negotiations. Ultimately the USTR raised tariffs on room ACs to 25 percent on May 10, 2019. The USTR press release on the increase in tariffs can be found at: ustr.gov/sites/default/files/enforcement/ 301Investigations/83%20FR%2047974.pdf. The 
Notice of Modification of Section 301 can be found at: ustr.gov/sites/default/files/enforcement/ 
301Investigations/84_ FR_20459.pdf. 
58www.epa.gov/sites/production/files/2016-09/ 
documents/emission-factors_ nov_ 2015_ v2.pdf (last 
accessed June 14, 2021). 
59For further information, see the Assumptions to 
AEO 2021 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 14, 
2021). 60CSAPR requires states to address annual 
emissions of SO 2and NO X, precursors to the 
formation of fine particulate matter (PM 2.5) 
pollution, in order to address the interstate 
transport of pollution with respect to the 1997 and 2006 PM
2.5National Ambient Air Quality Standards 
(‘‘NAAQS’’). CSAPR also requires certain states to address the ozone season (May–September) emissions of NO
X, 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). As result of tariffs, as noted by AHAM, 
‘‘some manufacturers have had to shift production to other countries to avoid the tariffs.’’ (AHAM, No. 19 at pp. 18– 19) DOE understands that these products are now made in countries in East Asia and Southeast Asia not subject to Section 301 tariffs. However, due to uncertainty about the exact countries of origin, DOE’s engineering analysis continues to rely on data based on a Chinese point of origin. To revise MPCs to account for points of origin outside of China, DOE would require information on the countries of manufacture and 5- year averages for key inputs, such as fully burdened production labor wage rates and local raw material prices, used to develop MPCs. 
To better model the impact of Section 
301 tariffs on room AC products that continue to be manufactured in China, DOE requires additional information about the portion of products still manufactured in China and how the tariffs are absorbed by the entities along the room AC value chain, such as the foreign OEMs, U.S. importers, retailers, and consumers. Increases in retail price may affect consumer purchasing decisions, as captured by the price sensitivity modeled in the shipments analysis. 
Additional details about cumulative 
regulatory burden and requests for comment can be found in section V.B.2.d of this document. 
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 CO
2, NO X, SO 2, and Hg. 
The second component estimates the impacts of potential standards on emissions of two additional greenhouse gases, CH
4and N 2O, 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 power sector 
emissions of CO
2, NO X, SO 2, and Hg 
uses marginal emissions factors that were derived from data in AEO 2021, as described in section IV.M of this document. Details of the methodology are described in the appendices to chapters 13 and 15 of the NOPR TSD. 
Power sector emissions of CO
2, CH 4, 
and N 2O are estimated using Emission 
Factors for Greenhouse Gas Inventories published by the EPA.
58The FFC 
upstream emissions are estimated based on the methodology described in chapter 15 of the NOPR TSD. The upstream emissions include both emissions from extraction, processing, and transportation of fuel, and ‘‘fugitive’’ emissions (direct leakage to the atmosphere) of CH
4and CO 2. 
The emissions intensity factors are 
expressed in terms of physical units per megawatt-hours (‘‘MWh’’) or million British thermal units (‘‘MMBtu’’) of site energy savings. 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 2021, which incorporates the projected 
impacts of existing air quality regulations on emissions. AEO 2021 generally represents current legislation and environmental regulations, including recent government actions that were in place at the time of preparation of AEO 2021, including the emissions control programs discussed in the following paragraphs.
59 
SO 2emissions 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 SO
2for affected EGUs in the 48 
contiguous States and the District of Columbia (D.C.). (42 U.S.C. 7651 et seq.) SO
2emissions 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 SO
2emissions, and 
went into effect as of January 1, 2015.60 
AEO 2021 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 SO
2emissions 
allowances resulting from the lower electricity demand caused by the adoption of an efficiency standard could be used to permit offsetting increases in SO
2emissions by another regulated 
EGU. 
However, beginning in 2016, SO 2 
emissions began to fall as a result of implementation 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 SO
2(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, SO
2emissions 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. 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 SO
2emissions. 
Because of the emissions reductions under the MATS, it is unlikely that excess SO
2emissions allowances 
resulting from the lower electricity demand would be needed or used to permit offsetting increases in SO
2 
emissions by another regulated EGU. Therefore, energy conservation standards that decrease electricity 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00036 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420643 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
generation would generally reduce SO 2 
emissions. DOE estimated SO 2 
emissions reduction using emissions 
factors based on AEO2021. 
CSAPR also established limits on NO X 
emissions for numerous States in the eastern half of the United States. Energy conservation standards would have little effect on NO
Xemissions in those 
States covered by CSAPR emissions limits if excess NO
Xemissions 
allowances resulting from the lower electricity demand could be used to permit offsetting increases in NO
X 
emissions from other EGUs. In such case, NO
Xemissions 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 NO
Xemissions 
might not remain at the limit in the case of lower electricity demand. In this case, energy conservation standards might reduce NO
Xemissions 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 NO
X 
emissions in States covered by CSAPR. Energy conservation standards would be expected to reduce NO
Xemissions in 
the States not covered by CSAPR. DOE used AEO 2021 data to derive NO
X 
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 AEO 2021, 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 CO
2,CH 4, N2O, 
NO X, and SO 2that 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 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. In the absence of further intervening court orders, DOE will revert to its approach prior to the injunction and present 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 
For the purpose of complying with 
the requirements of Executive Order 12866, DOE estimates the monetized benefits of the reductions in emissions of CO
2, CH 4, and N 2O by using a 
measure of the social cost (‘‘SC’’) of each pollutant (e.g., SC–GHGs). 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 guidance, and DOE would reach the same conclusion presented in this proposed rulemaking in the absence of the social cost of greenhouse gases, including the February 2021 Interim Estimates presented by the Interagency Working Group on the Social Cost of Greenhouse Gases. DOE exercises its own judgment 
in presenting monetized climate benefits as recommended by applicable Executive Orders, and DOE would reach the same conclusion presented in this notice in the absence of the social cost of greenhouse gases, including the 
February 2021 Interim Estimates presented by the Interagency Working Group on the Social Cost of Greenhouse Gases. 
DOE estimated the global social 
benefits of CO
2, CH 4, and N 2O 
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 Interagency Working Group on the Social Cost of Greenhouse Gases (IWG) (IWG, 2021). 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 CO
2, N2O 
and CH4 emissions. As a member of the IWG involved in the development of the February 2021 SC–GHG TSD), the DOE agrees that the interim SC–GHG estimates represent the most appropriate estimate of the SC–GHG until revised estimates have been developed reflecting the latest, peer-reviewed science. 
The SC–GHGs estimates presented 
here were developed over many years, using transparent process, peer- reviewed methodologies, the best science available at the time of that process, and with input from the public. Specifically, in 2009, an interagency working group (IWG) that included the DOE and other executive branch agencies and offices was established to ensure that agencies were using the best available science and to promote consistency in the social cost of carbon (SC–CO2) values used across agencies. The IWG published SC–CO
2estimates 
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 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00037 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420644 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
population, economic, and CO 2 
emissions growth, as well as 
equilibrium climate sensitivity (ECS)—a measure of the globally averaged temperature response to increased atmospheric CO
2concentrations. 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 (SC–CH4) and nitrous oxide (SC–N2O) using methodologies that are consistent with the methodology underlying the SC– CO
2estimates. 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. (2015) 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). 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)). 
On January 20, 2021, President Biden 
issued Executive Order 13990, which re- established the IWG and directed it to ensure that the U.S. Government’s estimates of the social cost of carbon and other greenhouse gases reflect the best available science and the recommendations of the National Academies (2017). The IWG was tasked with first reviewing the SC–GHG estimates currently used in Federal analyses and publishing interim estimates within 30 days of the E.O. that reflect the full impact of GHG emissions, including by taking global damages into account. The interim SC– GHG estimates published in February 2021, specifically the SC–CH4 estimates, 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 a global perspective is essential for SC–GHG estimates because it fully captures climate impacts that affect the United States and which have been omitted from prior U.S.-specific estimates due to methodological constraints. Examples of omitted effects include direct effects on U.S. citizens, assets, and investments located abroad, supply chains, and tourism, and spillover pathways such as economic and political destabilization and global migration. 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. 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. 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–CH4. This approach is the same as that taken in DOE regulatory analyses from 2012 through 2016. Prior to that, in 2008 DOE presented Social Cost of Carbon (SCC) estimates based on values the Intergovernmental Panel on Climate Change (IPCC) identified in literature at that time. As noted in the February 2021 SC–GHG TSD, the IWG will continue to review developments in the literature, including more robust methodologies for estimating a U.S.-specific SC–GHG value, and explore ways to better inform the public of the full range of carbon impacts. As a member of the IWG, DOE will continue to follow developments in 
the literature pertaining to this issue. 
Second, the IWG found that the use of 
the social rate of return on capital (7 percent under current OMB Circular A– 4 guidance) to discount the future benefits of reducing GHG emissions inappropriately underestimates the impacts of climate change for the purposes of estimating the SC–GHG. Consistent with the findings of the National Academies (2017) and the economic literature, the IWG continued to conclude that the consumption rate of interest is the theoretically appropriate discount rate in an intergenerational context (IWG 2010, 2013, 2016a, 2016b), and recommended that discount rate uncertainty and relevant aspects of intergenerational ethical considerations be accounted for in selecting future discount rates. As a member of the IWG involved in the development of the February 2021 SC–GHG TSD, DOE agrees with this assessment and will continue to follow developments in the literature pertaining to this issue. 
While the IWG works to assess how 
best to incorporate the latest, peer reviewed science to develop an updated set of SC–GHG estimates, it set the interim estimates to be the most recent estimates developed by the IWG prior to the group being disbanded in 2017. The estimates rely on the same models and harmonized inputs and are calculated using a range of discount rates. As explained in the February 2021 SC– GHG TSD, the IWG has recommended that agencies to revert to the same set of four values drawn from the SC–GHG distributions based on three discount rates as were used in regulatory analyses between 2010 and 2016 and subject to public comment. For each discount rate, the IWG combined the distributions across models and socioeconomic emissions scenarios (applying equal weight to each) and then selected a set of four values recommended for use in benefit-cost analyses: An average value resulting from the model runs for each of three discount rates (2.5 percent, 3 percent, and 5 percent), plus a fourth value, selected as the 95th percentile of estimates based on a 3 percent discount rate. The fourth value was included to provide information on potentially higher-than-expected economic impacts from climate change. As explained in the February 2021 SC–GHG TSD, and DOE agrees, this update reflects the immediate need to have an operational SC–GHG for use in regulatory benefit- cost analyses and other applications that was developed using a transparent process, peer-reviewed methodologies, 
and the science available at the time of that process. Those estimates were 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00038 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420645 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
61For example, the February 2021 TSD discusses 
how the understanding of discounting approaches 
suggests that discount rates appropriate for intergenerational analysis in the context of climate change may be lower than 3 percent. 
62See EPA, Revised 2023 and Later Model Year 
Light-Duty Vehicle GHG Emissions Standards: Regulatory Impact Analysis, Washington, DC, December 2021. Available at: https://www.epa.gov/ system/files/documents/2021-12/420r21028.pdf (last accessed January 13, 2022). 
63Interagency 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 _SocialCostof
CarbonMethaneNitrousOxide.pdf?source=email . subject to public comment in the 
context of dozens of proposed rulemakings as well as in a dedicated public comment period in 2013. 
DOE’s derivations of the SC–GHG 
(i.e., SC–CO
2, SC–N 2O, and SC–CH 4) 
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–CO
2values used for this 
NOPR were generated using the values 
presented in the 2021 update from the IWG’s February 2021 TSD. Table IV.8 shows the updated sets of SC–CO
2 
estimates from the latest interagency update in 5-year increments from 2020 
to 2050. The full set of annual values used is presented in Appendix 14A of the NOPR TSD. For purposes of capturing the uncertainties involved in regulatory impact analysis, DOE has determined it is appropriate to include all four sets of SC–CO
2values, as 
recommended by the IWG.61 
In calculating the potential global 
benefits resulting from reduced CO 2 
emissions, DOE used the values from 
the 2021 interagency report, adjusted to 2020$ using the implicit price deflator for gross domestic product (‘‘GDP’’) from the Bureau of Economic Analysis. For each of the four sets of SC–CO
2 
cases specified, the values for emissions in 2020 were $14, $51, $76, and $152 per metric ton avoided (values expressed in 2020$). DOE derived values after 2050 based on the trend in 2020–2050 in each of the four cases in the IWG update. DOE derived values from 2051 to 2070 based on estimates published by EPA.
62These estimates are 
based on methods, assumptions, and parameters identical to the 2020–2050 
estimates published by the IWG. DOE derived values after 2070 based on the trend in 2060–2070 in each of the four cases in the IWG update. 
DOE multiplied the CO
2emissions 
reduction estimated for each year by the SC–CO
2value for that year in each of 
the four cases. To calculate a present value of the stream of monetary values, DOE discounted the values in each of the four cases using the specific discount rate that had been used to obtain the SC–CO
2values in each case. 
See chapter 13 for the annual emissions 
reduction. See appendix 14A for the annual SC–CO
2values. b. Social Cost of Methane and Nitrous Oxide 
The SC–CH
4and SC–N 2O values used 
for this NOPR were generated using the values presented in the 2021 update from the IWG.
63Table IV.9 shows the 
updated sets of SC–CH 4and SC–N 2O 
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–CH
4and SC–N 2O values, as 
recommended by the IWG. 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00039 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.024</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table IV.8 Annual SC-CO2 Values from 2021 Interagency Update, 2020-2050 
2020$ oer Metric Ton CO2) 
Discount Rate 
Year 5% 3% 2.5% 3% 
Average Average Average 95th 
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 20646 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
64Estimating the Benefit per Ton of Reducing 
PM 2.5Precursors from 21 Sectors. www.epa.gov/ 
benmap/estimating-benefit-ton-reducing-pm25- 
precursors-21-sectors. 65As defined in the U.S. Census Bureau’s 2016 
Annual Survey of Manufactures, production workers include ‘‘Workers (up through the line- supervisor level) engaged in fabricating, processing, assembling, inspecting, receiving, packing, 
DOE multiplied the CH 4and N 2O 
emissions reduction estimated for each 
year by the SC–CH 4and SC–N 2O 
estimates for that year in each of the cases. To calculate a present value of the stream of monetary values, DOE discounted the values in each of the cases using the specific discount rate that had been used to obtain the SC–CH
4 
and SC–N 2O estimates in each case. See 
chapter 13 of the NOPR TSD for the annual emissions reduction. See appendix 14A of the NOPR TSD for the annual SC–CH
4and SC–N 2O values. 
2. Monetization of Other Air Pollutants 
For this NOPR, DOE estimated the 
monetized value of NO Xand SO 2 
emissions reductions from electricity generation using the latest benefit-per- ton estimates for that sector from the EPA’s Benefits Mapping and Analysis Program.
64DOE used EPA’s values for 
PM 2.5-related benefits associated with 
NO Xand SO 2and for ozone-related 
benefits associated with NO Xfor 2025, 
2030, 2035 and 2040, calculated with discount rates of 3 percent and 7 percent. DOE used linear interpolation to define values for the years not given in the 2025 to 2040 period; for years beyond 2040 the values are held constant. DOE derived values specific to the sector for room ACs using a method described in appendix 14B of the NOPR TSD. 
DOE multiplied the 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. 
The SCoC Commenters presented 
reasons why DOE should, as it has in the past, monetize the full climate benefits of greenhouse gas emissions reductions, using the best available estimates, which were derived by the Interagency Working Group on the Social Cost of Greenhouse Gases. The SCoC Commenters also stated that DOE should factor these benefits into its choice of the maximum efficiency level that is economically justified, consistent with its statutory requirement to assess the national need to conserve energy under the Energy Policy and Conservation Act. (SCoC, No. 21 at p. 1) 
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. In the absence of further intervening court orders, DOE will revert to its approach prior to the injunction and present monetized benefits where appropriate and permissible under law. 
M. Utility Impact Analysis 
The utility impact analysis estimates 
several effects on the electric power 
generation industry that would result from the adoption of new or amended energy conservation standards. The utility impact analysis estimates the 
changes in installed electrical capacity and generation that would result for each TSL. The analysis is based on published output from the NEMS associated with AEO 2021. 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 AEO 2021 Reference case and various side cases. Details of the methodology are provided in the appendices to chapters 13 and 15 of the NOPR TSD. 
The output of this analysis is a set of 
time-dependent coefficients that capture the change in electricity generation, primary fuel consumption, installed capacity and power sector emissions 
due to a unit reduction in demand for a given end use. These coefficients are multiplied by the stream of electricity savings calculated in the NIA to provide estimates of selected utility impacts of potential new or amended energy conservation standards. 
N. Employment Impact Analysis 
DOE considers employment impacts 
in the domestic economy as one factor 
in selecting a proposed standard. Employment impacts from new or amended energy conservation standards include both direct and indirect impacts. Direct employment impacts are any changes in the number of production and non-production employees of manufacturers of the products subject to standards.
65The 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00040 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.025</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table IV.9 Annual SC-CH4 and SC-N20 Values from 2021 Interagency Update, 2020--2050 
12020$ per Metric Ton) 
SC-CH4 SC-N20 
Discount Rate and Statistic Discount Rate and Statistic 
5% 3% 2.5% 3% 5% 3% 2.5% 3% 
Average Average Average 95th 
Average Average Average 95th 
Year percentile 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 llOO 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 20647 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
warehousing, shipping (but not delivering), 
maintenance, repair, janitorial, guard services, product development, auxiliary production for plant’s own use (e.g., power plant), record keeping, 
and other closely associated services (including truck drivers delivering ready-mixed concrete)’’ Non-production workers are defined as ‘‘Supervision above line-supervisor level, sales (including a driver salesperson), sales delivery (truck drivers and helpers), advertising, credit, collection, installation, and servicing of own products, clerical and routine office functions, executive, purchasing, finance, legal, personnel (including cafeteria, etc.), professional and technical.’’ 
66See U.S. Department of Commerce–Bureau of 
Economic Analysis. Regional Multipliers: A User Handbook for the Regional Input-Output Modeling System (RIMS II). 1997. U.S. Government Printing Office: Washington, DC. Available at www.bea.gov/ scb/pdf/regional/perinc/meth/rims2.pdf. 67Livingston, 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. 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 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.
66There 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 input/output model of the U.S. economy called Impact of Sector Energy Technologies version 4 (‘‘ImSET’’).
67 
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. 
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, 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 room ACs. It addresses the TSLs examined by DOE, the projected impacts of each of these 
levels if adopted as energy conservation standards for room ACs, 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. DOE analyzed the benefits and burdens of five TSLs for room ACs. DOE developed TSLs that combine efficiency 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 presents the TSLs and the 
corresponding efficiency levels that DOE has identified for potential amended energy conservation standards for room ACs. TSL 5 represents the max- tech energy efficiency for all product classes and corresponds to EL 5. TSL 4 corresponds to EL 4 for all product 
classes, consistent with the implementation of commercially available variable-speed compressors based on the current availability of variable speed compressors at cooling capacities ≥ 8,000 Btu/h. However, as of 
2022, there are no models commercially available that incorporate variable-speed compressors for cooling capacities less than 8,000 Btu/h, and the uncertainties of the possibilities of incorporating variable-speed compressors in smaller units may have the potential to eliminate room ACs with the smallest cooling capacities from the market. TSL 3, therefore, is constructed with EL 4 for product classes with cooling capacities ≥ 8,000 Btu/h, corresponding to the 
inclusion of commercially available variable-speed compressors, and EL 3 for cooling capacities < 8,000 Btu/h, corresponding to the incorporation of maximum energy efficient single-speed compressors. TSL 2 corresponds to EL 3 for all product classes and represents room ACs with the maximum energy efficient single-speed compressor. TSL 1 corresponds to EL 2 for all product classes and represents the current ENERGY STAR level. 
BILLING CODE 6450–01–P 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00041 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420648 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
68Efficiency levels that were analyzed for this 
NOPR are discussed in section IV.C.3 of this 
document. Results by efficiency level are presented in the NOPR TSD chapters 8, 10, and 12. 
DOE constructed the TSLs for this 
NOPR to include ELs representative of 
ELs with similar characteristics (i.e., using similar technologies and/or efficiencies, and having roughly comparable equipment availability). The use of representative ELs provided for greater distinction between the TSLs. While representative ELs were included in the TSLs, DOE considered all efficiency levels as part of its analysis but did not include all efficiency levels in the TSLs.
68DOE did not consider a 
TSL with EL 1 because DOE’s projected efficiency distribution indicated a significant portion of the market would meet or exceed EL 1 in the no-new- standards case by the compliance year leading to smaller national energy savings and lower LCC savings for a standard set at EL 1 relative to EL 2. As such, the least efficient level considered 
for TSLs in this NOPR is EL 2. 
B. Economic Justification and Energy 
Savings 
1. Economic Impacts on Individual 
Consumers 
DOE analyzed the economic impacts 
on room AC 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.2 through Table V.25 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 of each pair of tables, 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 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00042 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.026</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.1 Trial Standard Levels for Room Air Conditioners 
Product Class TSL 1 TSL2 TSL3 TSL4 TSL5 
CEER (Btu/Wh) 
Room AC without reverse cycle, with louvered sides 
<6,000 Btu/h (PC 1) 12.1 13.1 13.1 16.0 20.2 
6,000 to 7,999 Btu/h (PC 2) 12.1 13.7 13.7 16.0 20.2 
8,000 to 13,999 Btu/h (PC 3) 12.0 14.3 16.0 16.0 22.4 
14,000 to 19,999 Btu/h (PC 4) 11.8 14.0 16.0 16.0 20.6 
20,000 to 27,999 Btu/h (PC 5a) 10.3 11.8 13.8 13.8 19.1 
>28,000 Btu/h (PC 5b) 9.9 10.3 13.2 13.2 16.7 
Room AC without reverse cycle, without louvered sides 
<6,000 Btu/h (PC 6) 11.0 12.8 12.8 14.7 19.4 
6,000 to 7,999 Btu/h (PC 7) 11.0 12.8 12.8 14.7 19.4 
8,000 to 10,999 Btu/h (PC 8a) 10.6 12.3 14.1 14.1 18.7 
11,000 to 13,999 Btu/h (PC 8b) 10.5 12.3 13.9 13.9 19.1 
14,000 to 19,999 Btu/h (PC 9) 10.2 10.9 13.7 13.7 16.6 
>20,000 Btu/h (PC 10) 10.3 11.0 13.8 13.8 16.8 
Room AC with reverse cycle, with louvered sides 
<20,000 Btu/h (PC 11) 10.8 12.3 14.4 14.4 18.7 
>20,000 Btu/h (PC 13) 10.2 11.7 13.7 13.7 18.9 
Room AC with reverse cycle, without louvered sides 
<14,000 Btu/h (PC 12) 10.2 11.3 13.7 13.7 16.2 
>14,000 Btu/h (PC 14) 9.6 11.2 12.8 12.8 17.5 
Casement 
Casement-Only (PC 15) 10.5 12.2 13.9 13.9 18.1 
Casement-Slide (PC 16) 11.4 13.2 15.3 15.3 19.7 20649 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
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. 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00043 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.027</GPH> EP07AP22.028</GPH> EP07AP22.029</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.2 Average LCC and PBP Results for Room Air Conditioners PC 1, Without 
R C I d ·th L L th 6 000 Bt /h everse .ye e an WI ouvers, ess an ' u 
Average Costs 
2020$ Simple 
EL TSL CEER First Year's Lifetime Payback Installed 
Cost Operating Operating LCC years 
Cost Cost 
0 - 11.0 $370.65 $62.66 $468.55 $839.20 -
1 - 11.4 $372.06 $61.05 $456.64 $828.70 0.9 
2 1 12.1 $374.95 $55.09 $412.42 $787.37 0.6 
3 2,3 13.1 $379.10 $51.10 $382.87 $761.97 0.7 
4 4 16.0 $464.91 $42.09 $316.27 $781.19 4.6 
5 5 20.2 $477.52 $34.22 $257.85 $735.38 3.8 
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The 
PBP is measured relative to the baseline product. Average 
Lifetime 
years 
9.3 
9.3 
9.3 
9.3 
9.3 9.3 
Table V.3 Average LCC Savings Relative to the No-New-Standards Case for Room 
Air Conditioners PC 1, Without Reverse Cycle and with Louvers, Less than 6,000 
Btu/h 
Life-Cycle Cost Savine:s 
TSL CEER Average LCC Savings . Percent of Consumers that 
2020$ Exnerience Net Cost 
- 11.4 $0.82 0% 
1 12.1 $39.28 1% 
23 13.1 $63.49 3% 
4 16.0 $45.25 40% 
5 20.2 $91.06 32% 
* The savrngs represent the average LCC for affected consumers. 
Table V.4 Average LCC and PBP Results for Room Air Conditioners PC 2, Without 
R C I d ·th L 6 000-7 999 Bt /h everse ,ye e an WI ouvers, ' ' u 
Average Costs 
2020$ Simple 
EL TSL CEER Installed First Year's Lifetime Payback 
Cost Operating Operating LCC years 
Cost Cost 
0 - 11.0 $407.59 $81.06 $616.44 $1,024.03 -
1 - 11.4 $409.87 $78.35 $595.94 $1,005.81 0.8 
2 1 12.1 $413.43 $71.82 $546.61 $960.05 0.6 
3 2,3 13.7 $421.94 $64.22 $489.11 $911.04 0.9 
4 4 16.0 $511.73 $54.87 $418.34 $930.08 4.0 
5 5 20.2 $562.03 $44.64 $341.01 $903.04 4.2 
Note: The results for each TSL are calculated assumrng that all consumers use products at that efficiency level. The 
PBP is measured relative to the baseline product. Average 
Lifetime 
years 
9.3 
9.3 
9.3 9.3 
9.3 
9.3 20650 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00044 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.030</GPH> EP07AP22.031</GPH> EP07AP22.032</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.5 Average LCC Savings Relative to the No-New-Standards Case for Room 
A' C d'f PC 2 W'th t R C I d 'th L 6 000 7 999 Bt /h Ir on 1 10ners ' I OU everse .ye e an WI ouvers, ' -' u 
Life-Cycle Cost Savine:s 
TSL CEER Average LCC Savings . Percent of Consumers that 
2020$ Experience Net Cost 
- 11.4 $0.00 0% 
1 12.1 $34.23 2% 
2,3 13.7 $80.02 5% 
4 16.0 $62.00 40% 
5 20.2 $89.03 43% 
* The savmgs represent the average LCC for affected consumers. 
Table V.6 Average LCC and PBP Results for Room Air Conditioners PC 3, Without 
R C 1 "th L d S'd d 8 000-13 999 Bt /h everse ;ye e, w1 ouvere 1 es, an ' ' u 
Average Costs 
2020$ Simple 
EL TSL CEER Installed First Year's Lifetime Payback 
Cost Operating Operating LCC years 
Cost Cost 
0 - 10.9 $512.47 $104.95 $792.93 $1,305.40 -
1 - 11.4 $514.75 $101.34 $765.80 $1,280.55 0.6 
2 1 12.0 $518.90 $92.17 $697.03 $1,215.93 0.5 
3 2 14.3 $532.62 $78.23 $592.36 $1,124.98 0.8 
4 3,4 16.0 $616.54 $67.97 $514.54 $1,131.08 2.8 
5 5 22.4 $675.20 $50.21 $381.46 $1,056.67 3.0 
Note: The results for each TSL are calculated assummg that all consumers use products at that efficiency level. The 
PBP is measured relative to the baseline product. Average 
Lifetime 
years 
9.3 
9.3 
9.3 
9.3 9.3 9.3 
Table V.7 Average LCC Savings Relative to the No-New-Standards Case for Room 
Air Conditioners PC 3, Without Reverse Cycle, with Louvered Sides, and 8,000-
13,999 Btu/h 
Life-Cycle Cost Savine;s 
TSL CEER Average LCC Savings * Percent of Consumers that 
2020$ Exoerience Net Cost 
- 11.4 $0.00 0% 
1 12.0 $19.31 0% 
2 14.3 $104.92 4% 
3,4 16.0 $99.14 30% 
5 22.4 $173.55 30% 
* The savings represent the average LCC for affected consumers. 20651 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00045 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.033</GPH> EP07AP22.034</GPH> EP07AP22.035</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.8 Average LCC and PBP Results for Room Air Conditioners PC 4, Without 
R C I d ·th L 14 000--19 999 Bt /h everse ,ye e an WI ouvers, ' ' u 
Average Costs 
2020$ Simple 
EL TSL CEER First Year's Lifetime Payback Installed 
Cost Operating Operating LCC years 
Cost Cost 
0 - 10.7 $642.61 $120.26 $903.35 $1,545.97 -
1 - 11.1 $644.60 $116.98 $878.91 $1,523.51 0.6 
2 1 11.8 $651.70 $106.07 $797.78 $1,449.48 0.6 
3 2 14.0 $662.16 $90.20 $679.66 $1,341.82 0.7 
4 3,4 16.0 $769.44 $76.52 $577.36 $1,346.80 2.9 
5 5 20.6 $813.45 $60.04 $454.84 $1,268.29 2.8 
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The 
PBP is measured relative to the baseline product. Average 
Lifetime 
years 
9.3 
9.3 
9.3 9.3 9.3 
9.3 
Table V.9 Average LCC Savings Relative to the No-New-Standards Case for Room 
Air Conditioners PC 4, Without Reverse Cycle and with Louvers, 14,000-19,999 
Btu/h 
Life-Cvcle Cost Savin2s 
TSL CEER Average LCC Savings . Percent of Consumers that 
2020$ Experience Net Cost 
- 11.1 $0.00 0% 
1 11.8 $0.00 0% 
2 14.0 $102.30 1% 
3,4 16.0 $97.49 35% 
5 20.6 $176.00 32% 
* The savings represent the average LCC for affected consumers. 
Table V.10 Average LCC and PBP Results for Room Air Conditioners PC 5a, 
W0th t R C I d 0th L 20 000--27 999 Bt /h I OU everse .ye e an WI ouvers, ' ' u 
Average Costs 
2020$ Simple 
EL TSL CEER Installed First Year's Lifetime Payback 
Cost Operating Operating LCC years 
Cost Cost 
0 - 9.4 $800.55 $145.28 $1,057.96 $1,858.52 -
1 - 9.8 $803.27 $139.93 $1,019.56 $1,822.83 0.5 
2 1 10.3 $819.84 $129.42 $944.08 $1,763.92 1.2 
3 2 11.8 $831.48 $113.20 $827.62 $1,659.10 1.0 
4 3,4 13.8 $938.90 $91.54 $670.41 $1,609.31 2.6 
5 5 19.1 $1,011.43 $65.92 $486.74 $1,498.16 2.7 
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The 
PBP is measured relative to the baseline product. Average 
Lifetime 
years 
9.3 
9.3 
9.3 
9.3 
9.3 
9.3 20652 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00046 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.036</GPH> EP07AP22.037</GPH> EP07AP22.038</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.11 Average LCC Savings Relative to the No-New-Standards Case for Room 
Air Conditioners PC 5a, Without Reverse Cycle and with Louvers, 20,000-27,999 
Btu/h 
Life-Cycle Cost Savings 
TSL CEER Average LCC Savings * Percent of Consumers that 
2020$ Exoerience Net Cost 
- 9.8 $0.00 0% 
1 10.3 $5.28 1% 
2 11.8 $105.03 2% 
3,4 13.8 $152.52 32% 
5 19.1 $263.67 34% 
* The savings represent the average LCC for affected consumers. 
Table V.12 Average LCC and PBP Results for Room Air Conditioners PCs 5b, 
W"th t R 
C I d "th L G 
t th 28 000 Bt /h I OU everse .ye e an WI ouvers, rea er an ' u 
Average Costs 
2020$ Simple 
EL TSL CEER First Year's Lifetime Payback Installed Operating Operating LCC years Cost Cost Cost 
0 - 9.0 $848.65 $176.79 $1,288.42 $2,137.07 -
1 - 9.4 $851.46 $169.46 $1,235.83 $2,087.29 0.4 
2 1 9.9 $855.66 $156.16 $1,140.31 $1,995.97 0.3 
3 2 10.3 $859.12 $148.64 $1,086.31 $1,945.43 0.4 
4 3,4 13.2 $998.92 $110.63 $811.63 $1,810.54 2.3 
5 5 16.7 $1,049.36 $87.20 $643.64 $1,693.01 2.2 
Note: The results for each TSL are calculated assummg that all conswners use products at that efficiency level. The 
PBP is measured relative to the baseline product. Average 
Lifetime 
years 
9.3 
9.3 
9.3 
9.3 
9.3 
9.3 
Table V.13 Average LCC Savings Relative to the No-New-Standards Case for Room 
Air Conditioners PC 5b, Without Reverse Cycle and with Louvers, Greater than 
28,000 Btu/h 
Life-Cvcle Cost Savin2:s 
TSL CEER Average LCC Savings * Percent of Consumers that 
2020$ Exoerience Net Cost 
- 9.4 $20.50 0% 
1 9.9 $99.12 0% 
2 10.3 $147.14 0% 
3,4 13.2 $275.19 24% 
5 16.7 $392.72 25% 
* The savings represent the average LCC for affected consumers. 20653 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00047 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.039</GPH> EP07AP22.040</GPH> EP07AP22.041</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.14 Average LCC and PBP Results for Room Air Conditioners PC Sa, 
w·th t R C l d ·th t L d s· d 8 000-10 999 Bt /h I OU everse ,ye e an WI OU ouvere I es, ' ' u 
Average Costs 
2020$ Simple 
EL TSL CEER First Year's Lifetime Payback Installed 
Cost Operating Operating LCC years 
Cost Cost 
0 - 9.6 $526.19 $106.80 $806.94 $1,333.14 -
1 - 10.1 $529.28 $102.12 $771.88 $1,301.16 0.7 
2 I 10.6 $532.73 $94.84 $717.22 $1,249.95 0.5 
3 2 12.3 $543.73 $82.19 $622.28 $1,166.01 0.7 
4 3,4 14.1 $649.32 $69.87 $528.88 $1,178.20 3.3 
5 5 18.7 $681.04 $53.86 $408.91 $1,089.95 2.9 
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The 
PBP is measured relative to the baseline product. Average 
Lifetime 
years 
9.3 
9.3 
9.3 9.3 9.3 
9.3 
Table V.15 Average LCC Savings Relative to the No-New-Standards Case for Room 
Air Conditioners PC Sa, Without Reverse Cycle and without Louvered Sides, 8,000-
10,999 Btu/h 
Life-Cvcle Cost Savin2s 
TSL CEER Average LCC Savings . Percent of Consumers that 
2020$ Experience Net Cost 
- 10.1 $0.00 0% 
1 10.6 $5.67 0% 
2 12.3 $85.72 4% 
3,4 14.1 $74.28 37% 
5 18.7 $162.53 29% 
* The savings represent the average LCC for affected consumers. 
Table V.16 Average LCC and PBP Results for Room Air Conditioners PC Sb, 
w·th t R C l d ·th t L d s·d 11000-13999 Bt /h I OU everse ,ye e an WI OU ouvere I es, ' ' u 
Average Costs 
2020$ Simple 
EL TSL CEER Installed First Year's Lifetime Payback 
Cost Operating Operating LCC years 
Cost Cost 
0 - 9.5 $575.83 $131.04 $989.84 $1,565.68 -
1 - 10.0 $578.86 $125.53 $948.49 $1,527.35 0.5 
2 1 10.5 $582.99 $114.83 $868.19 $1,451.18 0.4 
3 2 12.3 $595.41 $99.04 $749.68 $1,345.10 0.6 
4 3,4 13.9 $684.21 $85.02 $643.37 $1,327.58 2.4 
5 5 19.1 $731.28 $63.62 $483.08 $1,214.36 2.3 
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The 
PBP is measured relative to the baseline product. Average 
Lifetime 
years 
9.3 
9.3 
9.3 
9.3 
9.3 9.3 20654 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00048 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.042</GPH> EP07AP22.043</GPH> EP07AP22.044</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.17 Average LCC Savings Relative to the No-New-Standards Case for Room 
Air Conditioners PC Sb, Without Reverse Cycle and without Louvered Sides, 
11,000-13,999 Btu/h 
Life-Cycle Cost Savings 
TSL CEER Average LCC Savings * Percent of Consumers that 
2020$ Exoerience Net Cost 
- 10.0 $0.00 0% 
1 10.5 $0.00 0% 
2 12.3 $100.02 3% 
3,4 13.9 $116.89 26% 
5 19.1 $230.10 23% 
* The savings represent the average LCC for affected consumers. 
Table V.18 Average LCC and PBP Results for Room Air Conditioners PC 9, 
W"th t R C I d "th t L d S"d 14 000-19 999 Bt /h I OU everse ,ye e an WI OU ouvere 1 es, ' ' u 
Average Costs 
2020$ Simple 
EL TSL CEER Installed First Year's Lifetime Payback 
Cost Operating Operating LCC years 
Cost Cost 
0 - 9.3 $719.11 $117.88 $883.56 $1,602.67 -
1 - 9.7 $722.16 $113.34 $849.88 $1,572.04 0.7 
2 1 10.2 $730.98 $104.87 $787.15 $1,518.13 0.9 
3 2 10.9 $736.20 $98.41 $739.24 $1,475.44 0.9 
4 3,4 13.7 $836.63 $75.96 $572.18 $1,408.81 2.8 
5 5 16.6 $865.13 $63.30 $478.47 $1,343.60 2.7 
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The 
PBP is measured relative to the baseline product. Average 
Lifetime 
years 
9.3 
9.3 
9.3 
9.3 
9.3 
9.3 
Table V.19 Average LCC Savings Relative to the No-New-Standards Case for Room 
Air Conditioners PC 9, Without Reverse Cycle and without Louvered Sides, 14,000-
19,999 Btu/h 
Life-Cvcle Cost Savin2s 
TSL CEER Average LCC Savings . Percent of Consumers that 
2020$ Exoerience Net Cost 
- 9.7 $11.98 1% 
1 10.2 $58.37 3% 
2 10.9 $98.98 2% 
3,4 13.7 $162.64 24% 
5 16.6 $227.85 24% 
* The savings represent the average LCC for affected consumers. 20655 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00049 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.045</GPH> EP07AP22.046</GPH> EP07AP22.047</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.20 Average LCC and PBP Results for Room Air Conditioners PC 11, With 
R C l d ·th L d s·d l th 20 000 Bt /h everse .ye e an WI ouvere I es, ess an ' u 
Average Costs 
2020$ Simple 
EL TSL CEER First Year's Lifetime Payback Installed 
Cost Operating Operating LCC years 
Cost Cost 
0 - 9.8 $576.42 $105.97 $808.00 $1,384.41 -
1 - 10.4 $580.33 $100.68 $767.83 $1,348.17 0.7 
2 l 10.8 $584.09 $92.59 $706.50 $1,290.59 0.6 
3 2 12.3 $595.08 $82.32 $628.54 $1,223.62 0.8 
4 3,4 14.4 $692.20 $69.57 $531.79 $1,223.99 3.2 
5 5 18.7 $737.07 $55.29 $423.44 $1,160.51 3.2 
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The 
PBP is measured relative to the baseline product. Average 
Lifetime 
years 
9.3 
9.3 
9.3 9.3 9.3 
9.3 
Table V.21 Average LCC Savings Relative to the No-New-Standards Case for Room 
Air Conditioners PC 11, With Reverse Cycle and with Louvered Sides, less than 
20,000 Btu/h 
Life-Cvcle Cost Savin2s 
TSL CEER Average LCC Savings . Percent of Consumers that 
2020$ Experience Net Cost 
- 10.4 $18.13 2% 
1 10.8 $67.57 2% 
2 12.3 $131.52 4% 
34 14.4 $131.12 30% 
5 18.7 $194.60 31% 
* The savings represent the average LCC for affected consumers. 
Table V.22 Average LCC and PBP Results for Room Air Conditioners PC 12, With 
R C l d 0th t L d S. d l th 14 000 Bt /h everse ;ye e an WI OU ouvere I es, ess an ' u 
Average Costs 
2020$ Simple 
EL TSL CEER Installed First Year's Lifetime Payback 
Cost Operating Operating LCC years 
Cost Cost 
0 - 9.3 $641.40 $87.09 $655.95 $1,297.35 -
1 - 9.7 $644.16 $83.90 $632.10 $1,276.26 0.9 
2 1 10.2 $652.09 $77.88 $587.01 $1,239.10 1.2 
3 2 11.3 $659.94 $71.00 $535.57 $1,195.51 1.2 
4 3,4 13.7 $714.83 $57.84 $436.71 $1,151.54 2.5 
5 5 16.2 $741.39 $49.73 $376.08 $1,117.48 2.7 
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. Average 
Lifetime 
years 
9.3 9.3 
9.3 
9.3 
9.3 9.3 20656 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
69Product Classes 4, 5a, 5b, and 9 account for 
approximately 9 percent of the total room AC 
market. 
b. Consumer Subgroup Analysis 
In the consumer subgroup analysis, 
DOE estimated the impact of the 
considered TSLs on low-income households and senior-only households for product classes with a sufficient sample size in RECS to perform a Monte Carlo analysis. DOE was unable to conduct a consumer subgroup analysis for Product Classes 4, 5a, 5b, and 9 for either low-income households or senior- only households due to insufficient sample size and does not report results for those product classes.
69Table V.26 
through Table V.41 compare the average 
LCC savings, PBP, percent of consumers negatively impacted, and percent of consumers positively impacted at each efficiency level for the consumer subgroups, along with corresponding values for the entire residential consumer sample for product classes with a sufficient sample size. In most cases, the values for low-income households and senior-only households 
at the considered efficiency levels are not substantially different from the average for all households. Chapter 11 of the NOPR TSD presents the complete LCC and PBP results for the subgroups. 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00050 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.048</GPH> EP07AP22.049</GPH> EP07AP22.050</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.23 Average LCC Savings Relative to the No-New-Standards Case for Room 
Air Conditioners PC 12, With Reverse Cycle and without Louvered Sides, less than 
14,000 Btu/h 
Life-Cycle Cost Savings 
TSL CEER Average LCC Savings * Percent of Consumers that 
2020$ Exoerience Net Cost 
- 9.7 $8.12 2% 
1 10.2 $39.97 7% 
2 11.3 $81.20 7% 
3,4 13.7 $122.74 20% 
5 16.2 $156.81 24% 
* The savings represent the average LCC for affected consumers. 
Table V.24 Average LCC and PBP Results for Room Air Conditioners PC 16, 
Casement-Slider 
Average Costs 
2020$ Simple 
EL TSL CEER Installed First Year's Lifetime Payback 
Cost Operating Operating LCC years 
Cost Cost 
0 - 10.4 $501.23 $86.26 $656.88 $1,158.11 -
1 - 10.8 $503.64 $83.42 $635.46 $1,139.09 0.8 
2 1 11.4 $507.10 $76.33 $581.83 $1,088.93 0.6 
3 2 13.2 $516.42 $67.41 $514.31 $1,030.73 0.8 
4 3,4 15.3 $616.56 $57.41 $438.70 $1,055.26 4.0 
5 5 19.7 $641.98 $45.89 $351.50 $993.49 3.5 Average 
Lifetime 
years 
9.3 
9.3 
9.3 9.3 9.3 
9.3 
Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is 
measured relative to the baseline product. 
Table V.25 Average LCC Savings Relative to the No-New-Standards Case for Room 
Air Conditioners PC 16, Casement-Slider 
Life-Cycle Cost Savings 
TSL CEER Average LCC Savings * Percent of Consumers that 
2020$ Exoerience Net Cost 
- 10.8 $6.42 2% 
1 11.4 $49.45 2% 
2 13.2 $104.75 4% 
3,4 15.3 $81.33 38% 
5 19.7 $143.10 34% 
* The savings represent the average LCC for affected consumers. 20657 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00051 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.051</GPH> EP07AP22.052</GPH> EP07AP22.053</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.26 Comparison of LCC Savings and PBP for Consumer Subgroups and All 
Households: Room Air Conditioners PC 1, Without Reverse Cycle and with Louvers, Less 
than 6,000 Btu/h 
Average Life-Cycle Cost Savings . Simple Payback Period 
2020$ vears 
Low-Income Senior-Only All Low-Senior-Only All EL TSL Income Households+ Households** Householdst Households Households** Householdst 
1 - $0.86 - $0.79 0.9 
2 1 $40.12 - $37.74 0.6 
3 2,3 $64.92 - $60.91 0.7 
4 4 $52.08 - $39.15 4.5 
5 5 $98.55 - $83.08 3.8 
• The savings represent the average LCC for affected consumers. Negative values denoted in parentheses. 
+ Low-income households represent 60.0 percent of all households for this product class. 
•• Insufficient sample size to conduct subgroup analysis. -
-
---
t The savings represent results of residential consumers only and exclude results from commercial consumers. 0.9 
0.6 
0.8 
5.0 
4.1 
Table V.27 Comparison of Percent of Impacted Consumers for Consumer Subgroups and 
All Households: Room Air Conditioners PC 1, Without Reverse Cycle and with Louvers, 
Less than 6,000 Btu/h 
Percent of Consumers that Percent of Consumers that 
Experience Net Cost ExDerience Net Benefit 
Low-Income Senior-Only All Low-Senior-Only All EL TSL Income Households+ Households** Householdst Households Households** Householdst 
1 - 0% - 0% 8% 
2 1 0% - 1% 93% 
3 2,3 0% - 2% 95% 
4 4 35% - 41% 60% 
5 5 26% - 32% 74% 
+ Low-mcome households represent 60.0 percent of all households for this product class. 
•• Insufficient sample size to conduct subgroup analysis. 
t Results for residential consumers only and exclude results from commercial consumers. -
-
-
-
-
Table V.28 Comparison of LCC Savings and PBP for Consumer Subgroups and All 
Households: Room Air Conditioners PC 2, Without Reverse Cycle and with Louvers, 
6,000--7,999 Btu/h 
Average Life-Cycle Cost Savings . Simple Payback Period 
2020$ vears 
Low-Income Senior-Only All Low-Income Senior-Only 8% 
92% 93% 
54% 
68% 
All EL TSL Households:!: Households§ Householdst Households Households Householdst 
1 - $0.00 $0.00 $0.00 0.8 0.7 
2 1 $36.28 $41.20 $35.27 0.6 0.5 
3 2,3 $84.74 $96.89 $82.61 0.8 0.7 
4 4 $67.05 $88.31 $65.64 3.9 3.5 
5 5 $98.48 $130.37 $95.14 4.2 3.7 
• The savmgs represent the average LCC for affected consumers. Negative values denoted m parentheses. 
+ Low-income households represent 50.1 percent of all households for this product class. 
§ Senior-only households represent 24.7 percent of all households for this product class. 
t The savings represent results of residential consumers only and exclude results from commercial consumers. 0.8 
0.6 0.9 
4.0 4.2 20658 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00052 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.054</GPH> EP07AP22.055</GPH> EP07AP22.056</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.29 Comparison of Percent of Impacted Consumers for Consumer Subgroups and 
All Households: Room Air Conditioners PC 2, Without Reverse Cycle and with Louvers, 
6,000-7,999 Btu/h 
Percent of Consumers that Percent of Consumers that 
Exoerience Net Cost Exoerience Net Benefit 
Low-Income Senior-Only All Low-Income Senior-Only All EL TSL Households:!: Households§ Householdst Households Households Householdst 
1 - 0% 0% 0% 0% 
2 1 1% 2% 1% 74% 
3 23 3% 5% 4% 90% 
4 4 38% 31% 38% 58% 
5 5 40% 33% 41% 60% 
+ Low-income households represent 50.1 percent of all households for this product class. 
§ Senior-only households represent 24.7 percent of all households for this product class. 
t Results for residential consumers only. 0% 0% 
72% 73% 
88% 89% 
64% 57% 
67% 59% 
Table V.30 Comparison of LCC Savings and PBP for Consumer Subgroups and All 
Households: Room Air Conditioners PC 3, Without Reverse Cycle, with Louvered Sides, 
and 8,000-13,999 Btu/h 
Average Life-Cycle Cost Savings . Simple Payback Period 
2020$ vears 
Low-Income Senior-Only All Low-Income Senior-Only All EL TSL Households:!: Households§ Householdst Households Households Householdst 
1 - $0.00 $0.00 $0.00 0.6 0.7 
2 1 $22.44 $17.94 $18.66 0.5 0.6 
3 2 $122.51 $96.97 $101.79 0.7 0.8 
4 3,4 $122.56 $81.51 $94.44 2.6 3.2 
5 5 $218.31 $148.90 $165.48 2.7 3.3 
• The savmgs represent the average LCC for affected consumers. Negative values denoted m parentheses. 
+ Low-income households represent 25.7 percent of all households for this product class. 
§ Senior-only households represent 26.6 percent of all households for this product class. 
t The savings represent results of residential consumers only and exclude results from commercial consumers. 
Table V.31 Comparison of Percent of Impacted Consumers for Consumer 
Subgroups and All Households: Room Air Conditioners PC 3, Without Reverse 
C 1 ·th L d s·d d 8 000-13 999 Bt /h ,ye e, w1 ouvere 1 es, an ' ' u 
Percent of Consumers that Percent of Consumers that 
Exoerience Net Cost Exoerience Net Benefit 
Low-Income Senior-Only All Low-Income Senior-Only 0.7 
0.5 0.8 
3.0 3.2 
All EL TSL Households:!: Households§ Households t Households Households Households t 
1 - 0% 0% 0% 0% 
2 1 0% 0% 0% 30% 
3 2 4% 6% 4% 90% 
4 34 28% 38% 29% 67% 
5 5 27% 40% 30% 73% 
+ Low-income households represent 25.7 percent of all households for this product class. 
§ Senior-only households represent 26.6 percent of all households for this product class. 
t Results for residential consumers only. 0% 0% 
30% 30% 
88% 90% 
57% 66% 
60% 70% 20659 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00053 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.057</GPH> EP07AP22.058</GPH> EP07AP22.059</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.32 Comparison of LCC Savings and PBP for Consumer Subgroups and All 
Households: Room Air Conditioners PC Sa, Without Reverse Cycle and without 
Louvered Sides, 8,000--10,999 Btu/h 
Average Life-Cycle Cost Savings . Simple Payback Period 
2020$ vears 
Low-Income Senior-Only All Low-Income Senior-Only All EL TSL Households+ Households§ Householdst Households Households Householdst 
1 - $0.00 $0.00 $0.00 0.6 0.7 
2 1 $6.90 $5.42 $5.55 0.5 0.6 
3 2 $100.26 $79.59 $83.45 0.6 0.8 
4 3,4 $96.07 $57.33 $70.43 3.0 3.7 
5 5 $203.50 $139.26 $155.62 2.7 3.2 
• The savmgs represent the average LCC for affected consumers. Negative values denoted m parentheses. 
+ Low-income households represent 25.7 percent of all households for this product class. 
§ Senior-only households represent 26.6 percent of all households for this product class. 
t The savings represent results of residential consumers only and exclude results from commercial consumers. 
Table V.33 Comparison of Percent of Impacted Consumers for Consumer 
Subgroups and All Households: Room Air Conditioners PC Sa, Without Reverse 
C I d ·th t L d s·d 8 000--10 999 Bt /h ,ye e an WI OU ouvere 1 es, ' ' u 
Percent of Consumers that Percent of Consumers that 
Experience Net Cost Experience Net Benefit 
Low-Income Senior-Only All Low-Income Senior-Only 0.7 
0.6 0.8 
3.5 3.1 
All EL TSL Households+ Households§ Householdst Households Households Householdst 
1 - 0% 0% 0% 0% 
2 1 0% 0% 0% 11% 
3 2 4% 5% 3% 91% 
4 3,4 35% 46% 36% 61% 
5 5 26% 38% 28% 74% 
+ Low-mcome households represent 25.7 percent of all households for this product class. 
§ Senior-only households represent 26.6 percent of all households for this product class. 
t Results for residential consumers only. 0% 0% 
11% 11% 
91% 92% 
50% 59% 
62% 72% 
Table V.34 Comparison of LCC Savings and PBP for Consumer Subgroups and All 
Households: Room Air Conditioners PC Sb, Without Reverse Cycle and without Louvered 
Sides, 11,000--13,999 Btu/h 
Average Life-Cycle Cost Savings . Simple Payback Period 
2020$ vears 
EL TSL Low-Income Senior-Only All Low-Income Senior-Only 
Households+ Households§ Householdst Households Households 
1 - $0.00 $0.00 $0.00 0.5 0.6 
2 1 $0.00 $0.00 $0.00 0.4 0.5 
3 2 $117.02 $92.83 $97.18 0.5 0.7 
4 3,4 $141.94 $96.54 $111.99 2.2 2.6 
5 5 $280.86 $201.36 $221.12 2.1 2.6 
• The savmgs represent the average LCC for affected consumers. Negative values denoted m parentheses. 
+ Low-income households represent 25.7 percent of all households for this product class. 
§ Senior-only households represent 26.6 percent of all households for this product class. 
t The savings represent results of residential consumers only and exclude results from commercial consumers. All 
Householdst 
0.6 0.5 0.7 
2.5 
2.5 20660 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00054 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.060</GPH> EP07AP22.061</GPH> EP07AP22.062</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.35 Comparison of Percent of Impacted Consumers for Consumer Subgroups and 
All Households: Room Air Conditioners PC Sb, Without Reverse Cycle and without 
Louvered Sides, 11,000--13,999 Btu/h 
Percent of Consumers that Percent of Consumers that 
Experience Net Cost Experience Net Benefit 
Low-Income Senior-Only All Low-Income Senior-Only All EL TSL Households:!: Households§ Householdst Households Households Householdst 
1 - 0% 0% 0% 0% 
2 1 0% 0% 0% 0% 
3 2 3% 4% 3% 91% 
4 3,4 24% 34% 25% 71% 
5 5 20% 31% 22% 80% 
+ Low-income households represent 25.7 percent of all households for this product class. 
§ Senior-only households represent 26.6 percent of all households for this product class. 
t Results for residential consumers only. 0% 0% 
0% 0% 
90% 91% 
61% 70% 
69% 78% 
Table V.36 Comparison of LCC Savings and PBP for Consumer Subgroups and All 
Households: Room Air Conditioners PC 11, With Reverse Cycle and with Louvered Sides, 
less than 20,000 Btu/h 
Average Life-Cycle Cost Savings . Simple Payback Period 
2020$ vears 
Low-Income Senior-Only All Low-Income Senior-Only All EL TSL Households:!: Households§ Households t Households Households Households t 
1 - $21.00 $19.73 $18.57 0.7 0.7 
2 1 $77.89 $73.55 $69.29 0.5 0.5 
3 2 $152.91 $143.97 $135.03 0.7 0.7 
4 3,4 $160.90 $146.67 $136.12 2.9 3.0 
5 5 $241.86 $220.82 $202.33 2.8 3.0 
• The savings represent the average LCC for affected consumers. Negative values denoted in parentheses. 
+ Low-income households represent 39 .4 percent of all households for this product class. 
§ Senior-only households represent 25.0 percent of all households for this product class. 
t The savings represent results of residential consumers only and exclude results from commercial consumers. 0.7 0.6 0.8 
3.2 3.2 
Table V.37 Comparison of Percent of Impacted Consumers for Consumer Subgroups and 
All Households: Room Air Conditioners PC 11, With Reverse Cycle and with Louvered 
Sides, less than 20,000 Btu/h 
Percent of Consumers that Percent of Consumers that 
Exoerience Net Cost Exoerience Net Benefit 
Low-Income Senior-Only All Low-Income Senior-Only All EL TSL Households:!: Households§ Households t Households Households Households t 
1 - 1% 2% 2% 49% 
2 1 1% 2% 1% 85% 
3 2 3% 5% 3% 93% 
4 34 24% 30% 27% 72% 
5 5 24% 31% 28% 76% 
+ Low-income households represent 39 .4 percent of all households for this product class. 
§ Senior-only households represent 25.0 percent of all households for this product class. 
t Results for residential consumers only. 49% 49% 
83% 84% 
90% 92% 
65% 68% 
69% 72% 20661 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00055 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.063</GPH> EP07AP22.064</GPH> EP07AP22.065</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.38 Comparison of LCC Savings and PBP for Consumer Subgroups and All 
Households: Room Air Conditioners PC 12, With Reverse Cycle and without Louvered 
Sides, less than 14,000 Btu/h 
Average Life-Cycle Cost Savings . Simple Payback Period 
2020$ vears 
Low-Income Senior-Only All Low-Income Senior-Only All EL TSL Households+ Households§ Households t Households Households Households t 
1 - $9.52 $9.75 $8.10 0.8 0.8 
2 1 $46.78 $47.40 $39.96 1.1 1.0 
3 2 $94.76 $96.18 $81.15 1.1 1.0 
4 3,4 $142.91 $146.29 $122.08 2.4 2.3 
5 5 $186.10 $190.33 $156.32 2.5 2.5 
• The savmgs represent the average LCC for affected consumers. Negative values denoted m parentheses. 
+ Low-income households represent 41.1 percent of all households for this product class. 
§ Senior-only households represent 25.1 percent of all households for this product class. 
t The savings represent results of residential consumers only and exclude results from commercial consumers. 0.9 
1.2 
1.2 
2.6 2.8 
Table V.39 Comparison of Percent of Impacted Consumers for Consumer Subgroups and 
All Households: Room Air Conditioners PC 12, With Reverse Cycle and without Louvered 
Sides, less than 14,000 Btu/h 
Percent of Consumers that Percent of Consumers that 
Experience Net Cost Experience Net Benefit 
Low-Income Senior-Only All Low-Income Senior-Only All EL TSL Households+ Households§ Householdst Households Households Householdst 
1 - 1% 2% 1% 38% 
2 1 4% 8% 6% 82% 
3 2 4% 8% 6% 90% 
4 3,4 16% 20% 19% 79% 
5 5 19% 23% 22% 81% 
+ Low-mcome households represent 41.1 percent of all households for this product class. 
§ Senior-only households represent 25.1 percent of all households for this product class. 
t Results for residential consumers only. 37% 
78% 
87% 
75% 77% 
Table V.40 Comparison of LCC Savings and PBP for Consumer Subgroups and All 
Households: Room Air Conditioners PC 16, Casement-Slider 
Average Life-Cycle Cost Savings . Simple Payback Period 
2020$ vears 
Low-Income Senior-Only All Low-Income Senior-Only 38% 
80% 89% 
76% 78% 
All EL TSL Households:!: Households§ Householdst Households Households Householdst 
1 - $7.03 $7.33 $6.38 0.8 0.8 
2 1 $55.02 $57.23 $49.31 0.5 0.5 
3 2 $ll7.04 $121.97 $104.50 0.7 0.7 
4 34 $94.78 $100.47 $80.20 3.8 3.7 
5 5 $167.19 $176.90 $142.02 3.3 3.2 
• The savings represent the average LCC for affected consumers. Negative values denoted in parentheses. 
+ Low-income households represent 44.9 percent of all households for this product class. 
§ Senior-only households represent 21.4 percent of all households for this product class. 
t The savings represent results of residential consumers only and exclude results from commercial consumers. 0.9 0.6 0.8 
4.2 
3.6 20662 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
c. Rebuttable Presumption Payback 
As discussed in section II.A of this 
document, EPCA establishes a 
rebuttable presumption that an energy conservation standard is economically justified if the increased purchase cost for a product that meets the standard is less than three times the value of the first-year energy savings resulting from the standard. (42 U.S.C. 6295(o)(2)(B)(iii)) In calculating a rebuttable presumption payback period for each of the considered TSLs, DOE used discrete values, and, as required by 
EPCA, based the energy use calculation on the DOE test procedure for room ACs. 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.42 presents the rebuttable- 
presumption payback periods for the considered TSLs for room ACs. 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. 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00056 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.066</GPH> EP07AP22.067</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.41 Comparison of Percent of Impacted Consumers for Consumer Subgroups and 
All Households: Room Air Conditioners PC 16, Casement-Slider 
Percent of Consumers that Percent of Consumers that 
Experience Net Cost Experience Net Benefit 
Low-Income Senior-Only All Low-Income Senior-Only All EL TSL Households+ Households§ Householdst Households Households Householdst 
1 - 1% 3% 2% 32% 
2 1 1% 3% 2% 84% 
3 2 3% 7% 4% 92% 
4 3,4 33% 36% 37% 62% 
5 5 28% 32% 32% 72% 
+ Low-mcome households represent 44.9 percent of all households for this product class. 
§ Senior-only households represent 21.4 percent of all households for this product class. 
t Results for residential consumers only. 
T bl V 42 Rb a e . e utta bl P e-resumption ay ac er10 s Pb kP. d 31% 
83% 
88% 
60% 68% 
Trial Standard Level 
Product Class 
1 2 3 4 
years 
PCl: Room Air Conditioners, without reverse cycle, with 1.0 1.0 1.0 7.0 louvered sides and less than 6,000 Btu/h 
PC2: Room Air Conditioners, without reverse cycle, with 0.9 1.0 1.0 5.4 louvered sides and 6 000 to 7,999 Btu/h 
PC3: Room Air Conditioners, without reverse cycle, with 0.6 0.8 3.5 3.5 louvered sides and 8 000 to 13 999 Btu/h 
PC4: Room Air Conditioners, without reverse cycle, with 0.6 0.5 2.5 2.5 louvered sides and 14 000 to 19 999 Btu/h 
PC5a: Room Air Conditioners, without reverse cycle, with 0.8 0.5 1.8 1.8 louvered sides and 20 000 to 27 999 Btu/h 
PC5b: Room Air Conditioners, without reverse cycle, with 0.2 0.2 1.5 1.5 louvered sides, and 28,000 Btu/h or more 
PC8a: Room Air Conditioners, without reverse cycle, without 0.6 0.7 3.8 3.8 louvered sides, and 8,000 to 10,999 Btu/h 
PC8b: Room Air Conditioners, without reverse cycle, without 0.5 0.6 2.8 2.8 louvered sides, and 11,000 to 13,999 Btu/h 
PC9: Room Air Conditioners, without reverse cycle, without 0.7 0.6 2.2 2.2 louvered sides, and 14,000 to 19,999 Btu/h 
PCl 1: Room Air Conditioners, with reverse cycle, with 0.7 0.8 3.8 3.8 louvered sides, and less than 20,000 Btu/h 
PC12: Room Air Conditioners, with reverse cycle, without 1.3 1.1 3.1 3.1 louvered sides, and less than 14,000 Btu/h 
PC16: Room Air Conditioners, Casement-Slider 0.7 0.8 4.8 4.8 32% 
84% 
91% 
58% 
68% 
5 
5.3 
5.2 
3.1 
2.2 
1.6 
1.4 
3.0 
2.4 
1.9 
3.3 
2.9 
3.9 20663 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
2. Economic Impacts on Manufacturers 
DOE performed an MIA to estimate 
the impact of amended energy 
conservation standards on manufacturers of room ACs. The following section describes the expected impacts on manufacturers at each considered TSL. Chapter 12 of the NOPR TSD explains the analysis in further detail. 
a. Industry Cash Flow Analysis Results 
In this section, DOE provides GRIM 
results from the analysis, which 
examines changes in the industry that would result from a standard. The following tables summarize the estimated financial impacts of potential amended energy conservation standards on manufacturers of room ACs, as well as the conversion costs that DOE estimates manufacturers of room ACs would incur at each TSL. 
The impact of potential amended 
energy conservation standards were analyzed under two markup 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 scenario provides the upper bound while the preservation of operating profits 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 (2021–2055). 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. 
BILLING CODE 6450–01–C 
At TSL 1, the standard is set to 
existing ENERGY STAR levels (EL 2) for all product classes. DOE estimates the change in INPV to be minimal under both manufacturer markup scenarios. INPV is expected to range from ¥0.8 percent to ¥0.5 percent. At this level, free cash flow is estimated to decrease by 8.0 percent compared to the no-new- standards case value of $72.6 million in the year 2025, the year before the 
standards year. DOE’s shipments analysis estimates approximately 75 percent of current shipments meet this level. At TSL 1, DOE does not expect industry to adopt new or larger chassis sizes. Capital conversion costs may be necessary for incremental updates in tooling. Product conversion costs are driven by specification, sourcing, and testing of more efficient compressors. DOE estimates capital conversion costs of $10.6 million and product conversion costs of $3.0 million. Conversion costs total $13.6 million. 
At TSL 2, the standard reflects an 
efficiency level attainable by units with the most efficient R–32 single-speed compressor on the market, in combination with other design options, 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00057 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.068</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.43 Manufacturer Impact Analysis Results for the Room Air Conditioner 
Industry* 
Units No New TSLl TSL2 TSLJ TSL4 TSL5 STDs Case 
1,072 1,053 1,016 968 611 
INPV $MM 1,081 to to to to to 
1,075 1,078 1,165 1,247 992 
Change in (0.8) (2.5) (6.0) (10.4) (43.5) 
% - to to to to to INPV (0.5) (0.3) 7.8 15.4 (8.2) 
Free Cash $MM 72.6 66.8 60.0 64.1 62.8 (139.3) Flow (2025) 
Change in 
Free Cash % - (8.0) (17.3) (11.7) (13.5) (291.7) 
Flow (2025) 
Conversion $MM 13.6 29.1 22.8 26.7 475.9 Costs -
*Negative values denoted by parentheses. 20664 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
70Capital conversion costs and product 
conversion costs may not sum to total due to 
independent rounding. for all product classes (EL 3). DOE 
estimates the change in INPV to range from ¥2.5 percent to ¥0.3 percent. At 
this level, free cash flow is estimated to decrease by 17.3 percent compared to the base-case value in the year before the standards year. DOE’s shipments analysis estimates approximately 30 percent of current shipments meet this level. At TSL 2, DOE does not expect industry to adopt new or larger chassis designs. Capital conversion costs may be necessitated by the incorporation of additional design options, such as the inclusion of sub-cooling. Product conversion costs are driven by the need to redesign models to incorporate more efficient single-speed compressors as well as other design options. DOE estimates capital conversion costs of $24.3 million and product conversion costs of $4.8 million. Conversion costs total $29.1 million. 
At TSL 3, the standard varies based by 
product class. For product classes with cooling capacities less than 8,000 Btu/ h, the standard reflects an efficiency level attainable by units with the most efficient R–32 single-speed compressor on the market (EL 3) in combination with other design options. For product classes with cooling capacities greater than or equal to 8,000 Btu/h, the standard reflects an efficiency level consistent with the implementation commercially available variable-speed compressors (EL 4). DOE estimates the change in INPV to range from ¥6.0 percent to 7.8 percent. At this level, free cash flow is estimated to decrease by 11.7 percent compared to the base-case value in the year before the standards year. DOE’s shipments analysis estimates approximately 1 percent of current shipments meet this level. 
At this level, DOE does not expect 
industry to adopt new or larger chassis designs. For product classes with cooling capacities greater than or equal to the 8,000 Btu/h threshold, additional capital conversion costs may be necessary to adjust appearance tooling. DOE anticipates greater redesign efforts and product conversion costs as manufacturers move these products to variable-speed compressor designs. DOE estimates capital conversion costs of $6.2 million and product conversion costs of $16.6 million. Conversion costs 
total $22.8 million. 
In interviews and through review of 
market data, DOE found that all but one OEM currently produce R–32 room AC models. Additionally, based on interview feedback, all OEMs intend to entirely transition to R–32 room ACs by 2023 regardless of DOE actions related to the energy conservation standards for room ACs. Thus, DOE did not consider the redesign costs related to R–32 as 
conversion costs that are the result of any amended energy conservation standards. However, DOE does take costs associated with the transition to low-GWP refrigerants into account in its modeling of the GRIM, as discussed in the cumulative regulatory burden portion of this notice in section V.B.2.d of this document. 
At TSL 4, the standard reflects the 
efficiency consistent with the implementation of commercially 
available variable-speed compressors for all product classes (EL 4). DOE estimates the change in INPV to range from ¥10.4 percent to 15.4 percent. At 
this level, free cash flow is estimated to decrease by 13.5 percent compared to the base-case value in the year before the standards year. DOE’s shipments analysis estimates that less than 1 percent of current shipments meet this level. At this level, DOE does not expect industry to adopt new or larger chassis designs. Capital conversion costs may be necessary for adjustments in appearance tooling. Compared to lower ELs, DOE anticipates significantly greater redesign efforts and product conversion costs as manufacturers move all products to variable-speed compressor designs. Based on DOE’s CCD, DOE estimates that OEMs would need to redesign all product platforms to meet the efficiency levels required by TSL 4. DOE estimates capital conversion costs of $6.0 million and product conversion costs of $20.7 million. Conversion costs total $26.7 million. 
At TSL 5, the standard reflects max- 
tech efficiency (EL 5) for all product classes. DOE estimates the change in INPV to range from ¥43.5 percent to ¥8.2 percent. At this level, free cash flow is estimated to decrease by 291.7 percent compared to the base-case value in the year before the standards year. In DOE’s review of the market, no models currently meet this level. DOE estimates capital conversion costs of $455.0 million and product conversion costs of $20.8 million. Conversion costs total $475.9 million.
70 
At this level, DOE expects significant 
changes to chassis size for both window and TTW units. As a result, capital conversion costs increase significantly as manufacturers adjust equipment and tooling to accommodate new dimensions. As with EL 4, DOE anticipates significant redesign efforts and product conversion costs as manufacturers move all products to variable-speed compressor designs. OEMs would need to redesign all 
product platforms to meet the efficiency levels required by TSL 5. 
At TSL 5, the large conversion costs 
result in a free cash flow dropping below zero in the years before the standard year. The negative free cash flow calculation indicates manufacturers may need to access cash reserves or outside capital to finance conversion efforts. 
b. Direct Impacts on Employment 
DOE’s research indicates no room ACs 
are currently made in domestic 
production facilities. DOE expects that amended standards would have no impact on domestic production employment, which would remain at zero. Manufacturers maintain offices in the United States to handle design, marketing, technical support, and other business needs. Large changes in total annual shipments may lead to companies reducing their non- production room AC staff. However, DOE’s shipments model does not forecast substantial changes in total annual shipments for the standards 
case. If total shipments remain relatively steady DOE would not expect any change to non-production employment as a result of amended standards. See section IV.G of this document for additional details on DOE’s shipments analysis. 
c. Impacts on Manufacturing Capacity 
In interviews, manufacturers noted 
that the majority of room ACs are 
manufactured overseas by high-volume manufacturers producing product for a range of international markets. Manufacturers had few concerns about production line constraints below the max-tech level. However, at the max- tech level, some manufacturers noted concerns about having sufficient technical resources to oversee the redesign and testing of all room AC products to incorporate variable-speed technology. 
Additionally, DOE notes that the most 
efficient variable-speed compressors that were implemented in the NOPR analysis are offered by only a single manufacturer. Based on public information, DOE was unable to determine the availability and pricing of these compressors. Given the lack of information regarding availability of these highest efficiency variable-speed compressors and the limited number of variable-speed compressors rated at or near the efficiency of compressors considered for the max-tech efficiency level, there may not be sufficient availability of the highest efficiency variable-speed compressors to meet the 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00058 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420665 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
entire industry’s production capacity 
needs at all cooling capacities of room ACs at EL 5. 
d. Impacts on Subgroups of 
Manufacturers 
Using average cost assumptions to 
develop industry cash-flow estimates may not capture the differential impacts among subgroups of manufacturers. Small manufacturers, niche players, or manufacturers exhibiting a cost structure that differs substantially from the industry average could be affected disproportionately. DOE investigated small businesses as a manufacturer subgroup that could be disproportionally impacted by energy conservation standards and could merit additional analysis. DOE did not identify any other adversely impacted manufacturer subgroups for this proposed rulemaking based on the results of the industry characterization. 
DOE analyzes the impacts on small 
businesses in a separate analysis in section VII.B of this document as part of the Regulatory Flexibility Analysis. For a discussion of the impacts on the small business manufacturer subgroup, see the Regulatory Flexibility Analysis in section VI.B of this document and chapter 12 of the NOPR TSD. 
e. Cumulative Regulatory Burden 
One aspect of assessing manufacturer 
burden involves looking at the 
cumulative impact of multiple DOE standards and the product-specific regulatory actions of other Federal agencies that affect the manufacturers of a covered product or equipment. While any one regulation may not impose a significant burden on manufacturers, the combined effects of several existing or impending regulations may have serious consequences for some manufacturers, groups of manufacturers, or an entire industry. Assessing the impact of a single regulation may overlook this cumulative regulatory burden. In addition to energy conservation standards, other regulations can significantly affect manufacturers’ financial operations. Multiple regulations affecting the same manufacturer can strain profits and lead companies to abandon product lines or markets with lower expected future returns than competing products. For these reasons, DOE conducts an analysis of cumulative regulatory burden as part of its rulemakings pertaining to appliance efficiency. DOE requests information regarding the impact of cumulative regulatory burden on manufacturers of room ACs associated with multiple DOE standards or product-specific regulatory actions of other Federal agencies. 
DOE evaluates product-specific 
regulations that will take effect approximately 3 years before or after the 2026 compliance date of any amended energy conservation standards for room ACs. This information is presented in Table V.44. 
BILLING CODE 6450–01–P 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00059 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420666 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
BILLING CODE 6450–01–C 
In addition to the Federal, product- 
specific cumulative regulatory burden 
described above, DOE considered the impacts of other factors in its review of 
burdens that could lead to industry constraints. CARB’s proposed 750 GWP limit for 
new room air conditioning equipment: 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00060 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.069</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.44 Compliance Dates and Expected Conversion Expenses of Federal 
Energy Conservation Standards Affecting Room Air Conditioner Manufacturers 
Number of Industry Industry 
Federal Energy Number of Manufacturers Approx. Conversion Conversion 
Conservation Manufacturers* Affected from Standards Costs Costs/ 
Standard Today's Rule** Year (Millions $) Product 
Revenue*** 
Commercial Warm $7.5 1.7% Air Furnaces to 
81 FR2420 16 1 2023 $22.2 to 
(January 15, 2016) (2014$) 5.1%t 
Small, Large, and 
Very Large 
Commercial 
Package Air 29 4 2018 and $520.8 4.9% Conditioning and 2023t (2014$) 
Heating Equipment 
81 FR2420 
(Januarv 15, 2016) 
Residential Central 
Air Conditioners $342.6 and Heat Pumps 51 8 2023 (2015$) 0.5% 
82FR 1786 
(Januarv 6, 2017) 
Portable Air 
Conditioners 11 5 2025 $320.9 6.7% 85 FR 1378 (2015$) 
(Januarv 10, 2020) 
Commercial 
Packaged Boilers 43 1 2023 $21.2 2.3% 85 FR 1592 (2015$) 
(Januarv 10, 2020) 
* This column presents the total number of manufacturers identified in the energy conservation standard 
rule contributing to cumulative regulatory burden. 
** This column presents the number of manufacturers producing room AC equipment that are also listed as 
manufacturers in the listed 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 
fmal rule. The conversion period typically ranges from 3 to 5 years, depending on the energy conservation 
standard. 
tLow and high conversion cost scenarios were analyzed as part of this Direct Final Rule. The range of 
estimated conversion expenses presented here reflects those two scenarios. 
tToe Direct Final Rule for Small, Large, and Very Large Commercial Package Air Conditioning and 
Heating Equipment adopts an amended standard in 2018 and a higher amended standard in 2023. The 
conversion costs are spread over an 8-year conversion period ending in 2022, with over 80 percent of the 
conversion costs occurring between 2019 and 2022. 20667 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
71ww3.arb.ca.gov/board/res/2020/res20-37.pdf. 
72UL 60335–2–40 includes safety requirements 
for the use of flammable refrigerants in the covered 
product. Standard for Household and Similar Electrical Appliances—Safety—Part 2–40: 
Requirements for Electrical Heat Pumps, Air- Conditioners and Dehumidifiers. UL 60335–2–40, Edition 3:2019. Northbrook, IL: Underwriters’ 
Laboratories. 73U.S. Office of Management and Budget. 
Circular A–4: Regulatory Analysis. September 17, 
2003. https://obamawhitehouse.archives.gov/omb/ 
circulars_ a004_ a-4/. DOE evaluated potential impacts of 
CARB’s proposed 750 GWP limit for 
new room ACs that would take effect in 2023.
71This proposed State regulation 
is specific to the products regulated by this NOPR. Based on manufacturer interviews, DOE understands that all OEMs and major manufacturers intend to transition their complete portfolio of room AC offerings for the U.S. market to R–32 refrigerant to meet CARB’s proposed requirement by 2023. DOE’s research and testing indicates that the transition to R–32 would likely not have a negative impact on product efficiency. 
DOE is aware of one OEM still in the 
process of redesigning room ACs to make use of R–32, including compliance with the relevant safety standard UL 60335–2–40.
72The on-going effort to 
transition its room AC product lines to make use of R–32 requires a level of investment beyond the typical annual R&D expenditures. To account for these investments, both the product development to make use of R–32 and product updates to meet UL 60335–2– 40, DOE has attempted to incorporate the on-going cost into its GRIM. DOE did not receive any quantitative estimates of the cost of the transition to R–32. For modeling purposes, DOE assumed that the transition to R–32 would require a doubling of R&D expenditures (2.2 percent of revenue) annually in the period between the base year and the compliance of the analysis for that business. This value is based on qualitative statements made by the OEM. 
DOE requests comment on the 
magnitude of costs associated with transitioning room AC models to low- GWP refrigerants, such as R–32, along with the associated UL costs that would be incurred between the publication of this NOPR and the proposed compliance date of amended standards. Quantification and categorization of these costs, such as engineering efforts, testing lab time, UL certification costs, and capital investments, would enable DOE to refine its analysis. 
Section 301 tariffs on certain Chinese 
goods: 
Regarding U.S. tariffs on Chinese 
imports, tariff levels have escalated in recent years. At the time of the April 2011 Direct Final Rule, most room ACs imported into the United States were manufactured in China. Since that time, as discussed above, the Section 301 tariffs on room ACs increased to 10 percent in September 2018 and to 25 percent in May 2019. As result of tariffs, as noted by AHAM, ‘‘some manufacturers have had to shift production to other countries to avoid the tariffs.’’ (AHAM, No. 19 at pp. 18– 19) DOE understands that these products are now made in countries in East Asia and Southeast Asia not subject to Section 301 tariffs. However, due to uncertainty about the exact countries of origin, DOE’s engineering analysis continues to rely on data based on a Chinese point of origin. To revise MPCs to account for points of origin outside of China, DOE would require information on the countries of manufacture and 5- year averages for key inputs used to develop manufacturer production costs, such as fully-burdened production labor wage rates and local raw material prices. 
To better model the impact of Section 
301 tariffs on room ACs that continue to be manufactured in China, DOE requires additional information about the portion of products still manufactured there and how the tariffs are absorbed by the entities along the room AC value chain, such as the foreign OEMs, U.S. importers, retailers, and consumers. Increases in retail price may affect consumer purchasing decisions, as captured by the price sensitivity modeled in the shipments analysis. 
DOE requests comment on the 
percentage of room ACs manufactured outside of China and the countries of origin, as well as information on the country-specific fully-burdened labor rates and key raw material prices. 
DOE requests comment on the impact 
of tariffs on pricing at each step in the distribution chain, as well as the percentage change in retail price paid by the consumer as result of Section 301 tariffs. 
3. National Impact Analysis 
This section presents DOE’s estimates 
of the national energy savings and the 
NPV of consumer benefits that would result from each of the TSLs considered as potential amended standards. 
a. Significance of Energy Savings 
To estimate the energy savings 
attributable to potential amended 
standards for room ACs, DOE compared their energy consumption under the no- new-standards case to their anticipated energy consumption under each TSL. The savings are measured over the entire lifetime of products purchased in the 30-year period that begins in the year of anticipated compliance with amended standards (2026–2055). Table V.45 presents DOE’s projections of the national energy savings for each TSL considered for room ACs. The savings were calculated using the approach described in section IV.H.2 of this document. 
OMB Circular A–473requires 
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. 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00061 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.070</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.45 Cumulative National Energy Savings for Room Air Conditioners; 30 
Years of Shipments (2026-2055) 
Trial Standard Level 
1 2 3 4 5 
quads 
Primary enernv savings 0.28 0.91 1.35 1.79 3.31 
FFC energv savings 0.29 0.94 1.40 1.86 3.44 20668 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
74Section 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. 
75U.S. Office of Management and Budget. 
Circular A–4: Regulatory Analysis. September 17, 2003. https://obamawhitehouse.archives.gov/omb/ 
circulars_ a004_ a-4/. 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.
74The review timeframe 
established in EPCA is generally not synchronized with the product lifetime, product manufacturing cycles, or other factors specific to room ACs. Thus, such results are presented for informational purposes only and are not indicative of any change in DOE’s analytical methodology. The NES sensitivity analysis results based on a 9-year 
analytical period are presented in Table V.46. The impacts are counted over the lifetime of room ACs purchased in 2026–2034. 
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 room ACs. In accordance with OMB’s guidelines on regulatory analysis,
75DOE calculated 
NPV using both a 7-percent and a 3- percent real discount rate. Table V.47 
shows the consumer NPV results with impacts counted over the lifetime of products purchased in 2026–2055. 
The NPV results based on the 
aforementioned 9-year analytical period 
are presented in Table V.48. The impacts are counted over the lifetime of products purchased in 2026–2034. 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. 
The previous results reflect the use of 
a default trend to estimate the change in 
price for room ACs over the analysis period (see section IV.F.6 of this document). DOE also conducted a 
sensitivity analysis that considered one scenario with a low price decline 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 fixed price case, the NPV of consumer benefits is lower than in the default case. c. Indirect Impacts on Employment 
It is estimated that amended energy 
conservation standards for room ACs 
would reduce energy expenditures for consumers of those products, with the resulting net savings being redirected to other forms of economic activity. These 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00062 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.071</GPH> EP07AP22.072</GPH> EP07AP22.073</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.46 Cumulative National Energy Savings for Room Air Conditioners; 
9 Years of Shipments (2026-2034) 
Trial Standard Level 
1 2 3 4 5 
quads 
Primary energv savings 0.11 0.37 0.51 0.65 1.08 
FFC energy savings 0.12 0.38 0.53 0.67 1.12 
Table V.47 Cumulative Net Present Value of Consumer Benefits for Room Air 
Conditioners; 30 Years of Shipments (2026-2055) 
Trial Standard Level 
Discount Rate 1 I 2 I 3 I 4 I 5 
billion 2020$ 
3 percent 2.71 I 8.55 I 10.56 I 12.21 I 22.59 
7 percent 1.35 I 4.25 I 4.83 I 5.21 I 9.64 
Table V.48 Cumulative Net Present Value of Consumer Benefits for Room Air 
Conditioners; 9 Years of Shipments (2026-2034) 
Trial Standard Level 
Discount Rate 1 I 2 I 3 I 4 I 5 
billion 2020$ 
3 percent 1.40 I 4.41 I 4.78 I 4.98 I 8.99 
7 percent 0.87 I 2.70 I 2.76 I 2.69 I 4.95 20669 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
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 (2026–2035), where these uncertainties are reduced. 
The results suggest that the proposed 
standards would be likely to have a negligible impact on the net demand for labor in the economy. The net change in jobs is so small that it would be imperceptible in national labor statistics and might be offset by other, unanticipated effects on employment. Chapter 16 of the NOPR TSD presents detailed results regarding anticipated indirect employment impacts. 
4. Impact on Utility or Performance of 
Products 
As discussed in section III.E.1.d of 
this document, DOE has tentatively concluded that the standards proposed in this NOPR would not lessen the utility or performance of the room ACs 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. As discussed in section III.E.1.e of this document, the Attorney General determines the impact, if any, of any lessening of competition likely to result from a proposed standard, and transmits such determination in writing to the Secretary, together with an analysis of the nature and extent of such impact. To assist the Attorney General in making this determination, DOE has provided DOJ with copies of this NOPR and the accompanying TSD for review. DOE will consider DOJ’s comments on the proposed rule in determining whether to proceed to a final rule. DOE will publish and respond to DOJ’s comments in that document. DOE invites comment from the public regarding the competitive impacts that are likely to result from this proposed rule. In addition, stakeholders may also provide comments separately to DOJ regarding these potential impacts. See the 
ADDRESSES section for information to 
send comments to DOJ. 6. Need of the Nation To Conserve 
Energy 
Enhanced energy efficiency, where 
economically justified, improves the Nation’s energy security, strengthens the economy, and reduces the environmental impacts (costs) of energy production. Reduced electricity demand due to energy conservation standards is also likely to reduce the cost of maintaining the reliability of the electricity system, particularly during peak-load periods. Chapter 15 of 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 room ACs is expected to yield environmental benefits in the form of reduced emissions of certain air pollutants and greenhouse gases. Table V.49 provides DOE’s estimate of cumulative emissions reductions expected to result from the TSLs considered in this 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. 
BILLING CODE 6450–01–P 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00063 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.074</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.49 Cumulative Emissions Reduction for Room Air Conditioners Shipped in 
2026-2055 
Trial Standard Level 
1 2 3 4 5 
Power Sector Emissions 
CO2 (million metric tons) 9.74 31.08 46.13 61.03 112.32 
SO2 (thousand tons) 3.98 12.68 18.82 24.90 45.83 
NOx (thousand tons) 3.98 12.71 18.80 24.83 45.55 
Hg (tons) 0.02 0.08 0.11 0.15 0.27 
CH4 (thousand tons) 0.71 2.28 3.37 4.45 8.16 
N2O (thousand tons) 0.10 0.32 0.47 0.62 1.13 
Upstream Emissions 
CO2 (million metric tons) 0.72 2.29 3.42 4.53 8.36 
SO2 (thousand tons) 0.05 0.17 0.26 0.34 0.63 
NOx (thousand tons) 10.66 33.97 50.61 67.08 123.95 
Hg (tons) 0.00 0.00 0.00 0.00 0.00 
CH4 (thousand tons) 70.73 225.37 335.89 445.30 823.18 
N2O (thousand tons) 0.00 0.01 0.02 0.02 0.04 
Total FFC Emissions 
CO2 (million metric tons) 10.46 33.37 49.55 65.55 120.68 
SO2 (thousand tons) 4.03 12.86 19.08 25.24 46.45 
NOx (thousand tons) 14.64 46.68 69.41 91.92 169.50 
Hg (tons) 0.02 0.08 0.11 0.15 0.28 
CH4 (thousand tons) 71.44 227.64 339.26 449.75 831.34 
N2O (thousand tons) 0.10 0.33 0.49 0.64 1.18 20670 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
As part of the analysis for this 
rulemaking, DOE estimated monetary 
benefits likely to result from the reduced emissions of CO
2that DOE estimated for each of the considered TSLs for room ACs. Section IV.L of this document discusses the SC–CO
2values 
that DOE used. Table V.50 presents the value of CO 2emissions reduction at 
each TSL. 
As discussed in section IV.L.1.b of 
this document, DOE estimated monetary benefits likely to result from the reduced emissions of CH
4and N 2O that DOE estimated for each of the considered TSLs for room ACs. Table V.51 presents the value of the CH
4 
emissions reduction at each TSL, and Table V.52 presents the value of the N 2O 
emissions reduction at each TSL. 
DOE is well aware that scientific and 
economic knowledge about the 
contribution of CO 2and other GHG 
emissions to changes in the future global climate and the potential resulting damages to the world economy continues to evolve rapidly. Thus, any value placed on reduced GHG emissions in this proposed rulemaking is subject to change. That said, because of omitted damages, DOE agrees with the IWG that these estimates most likely underestimate the climate benefits of greenhouse gas reductions. DOE, together with other Federal agencies, 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00064 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.075</GPH> EP07AP22.076</GPH> EP07AP22.077</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.50 Present Social Value of CO2 Emissions Reduction for Room Air 
C d'f Sh' d. 2026 2055 on 1 10ners 1ppe m -
SC-CO2 Case 
Discount Rate and Statistics 
TSL 5% 3% 2.5% 3% 
Average Average Average 95th percentile 
million 2020$ 
1 99.0 418.0 650.4 1272.0 
2 317.7 1,339.3 2,082.1 4,076.6 
3 464.4 1,969.6 3,067.2 5,993.9 
4 609.2 2,592.3 4,040.8 7,888.1 
5 1,101.6 4,721.6 7,374.2 14,364.6 
Table V.51 Present Social Value of Methane Emissions Reduction for Room Air 
C d'f Sh' d. 2026 2055 on 1 10ners 1ppe m -
SC-CH4 Case 
Discount Rate and Statistics 
TSL 5% 3% 2.5% 3% 
Average Average Average 95th percentile 
million 2020$ 
1 30.5 88.3 122.5 234.2 
2 98.0 282.2 391.2 749.3 
3 143.9 418.0 580.6 1,109.1 
4 189.3 552.3 767.8 1,464.9 
5 344.3 1,014.1 1,412.8 2,688.2 
Table V.52 Present Social Value of Nitrous Oxide Emissions Reduction for Room 
A' C d' . Sh' d. 2026 2055 Ir on It10ners 1ppe m -
SC-N20 Case 
Discount Rate and Statistics 
TSL 5% 3% 2.5% 3% 
Avera2:e Avera2:e Avera2:e 95th oercentile 
million 2020$ 
1 0.37 1.44 2.21 3.82 
2 1.18 4.60 7.09 12.22 
3 1.72 6.75 10.42 17.95 
4 2.25 8.88 13.72 23.61 
5 4.06 16.14 24.99 42.94 20671 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
will continue to review methodologies 
for estimating the monetary value of reductions in CO
2and other GHG 
emissions. This ongoing review will consider the comments on this subject 
that are part of the public record for this and other rulemakings, as well as other methodological assumptions and issues. DOE notes that the proposed standards 
would be economically justified even without inclusion of monetized benefits 
of reduced GHG emissions. 
DOE also estimated the monetary 
value of the economic benefits associated with SO
2emissions 
reductions anticipated to result from the considered TSLs for room ACs. The 
dollar-per-ton values that DOE used are discussed in section IV.L.2 of this document. Table V.53 presents the present value for SO
2for each TSL 
calculated using 7-percent and 3- percent discount rates. 
DOE also estimated the monetary 
value of the economic benefits 
associated with NO Xemissions 
reductions anticipated to result from the considered TSLs for room ACs. The dollar-per-ton values that DOE used are discussed in section IV.L.2 of this document. Table V.54 presents the present value for NO
Xemissions 
reduction for each TSL calculated using 
7-percent and 3-percent discount rates. 
The benefits of reduced CO 2, CH 4, and 
N2O emissions are collectively referred 
to as climate benefits. The benefits of 
reduced SO 2and NO Xemissions are 
collectively referred to as health benefits. For the time series of estimated monetary values of reduced emissions, see chapter 14 of the NOPR TSD. 
7. Other Factors 
The Secretary of Energy, in 
determining whether a standard is 
economically justified, may consider any other factors that the Secretary deems to be relevant. (42 U.S.C. 6295(o)(2)(B)(i)(VII)) No other factors were considered in this analysis. 
8. Summary of National Economic 
Impacts 
Table V.55 presents the NPV values 
that result from adding the monetized estimates of the potential economic, climate, and health benefits resulting from reduced GHG, SO
2, and NO X 
emissions to the NPV of consumer benefits calculated for each TSL considered in this rulemaking. The consumer benefits are domestic U.S. monetary savings that occur as a result of purchasing the covered room ACs, and are measured for the lifetime of products shipped in 2026–2055. 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 room ACs shipped in 2026– 2055. The climate benefits associated with four SC–GHG estimates are shown. DOE does not have a single central SC– GHG point estimate and it emphasizes the importance and value of considering the benefits calculated using all four SC–GHG estimates. 
BILLING CODE 6450–01–C 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00065 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.078</GPH> EP07AP22.079</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.53 Present Value of S02 Emissions Reduction for Room Air Conditioners 
Sh. d . 2026--2055 1ppe ID 
SC-S02 Case 
TSL 7% Discount Rate I 3% Discount Rate 
million 2020$ 
1 106.3 236.2 
2 343.0 758.4 
3 492.2 1,109.7 
4 639.2 1,456.8 
5 1,130.5 2,639.1 
Table V.54 Present Value of NOx Emissions Reduction for Room Air Conditioners 
Sh. d . 2026--2055 1ppe ID 
SC-NOx Case 
TSL 7% Discount Rate I 3 % Discount Rate 
million 2020$ 
1 285.7 643.9 
2 922.2 2,067.7 
3 1,326.6 3,032.6 
4 1,724.1 3,985.0 
5 3,056.7 7,236.1 20672 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
76P.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. 
77Sanstad, A.H. Notes on the Economics of 
Household Energy Consumption and Technology Choice. 2010. Lawrence Berkeley National 
Laboratory. www1.eere.energy.gov/buildings/ 
appliance_ standards/pdfs/consumer_ ee_theory.pdf 
(last accessed June 16, 2021). 
The national operating cost savings 
are domestic U.S. monetary savings that 
occur as a result of purchasing the covered room ACs, and are measured for the lifetime of products shipped in 2026–2055. The benefits associated with reduced GHG emissions achieved as a result of the adopted standards are also calculated based on the lifetime of room ACs shipped in 2026–2055. 
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 room ACs 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.
76 
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.
77 
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. 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00066 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.080</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.55 NPV of Consumer Benefits Combined with Monetized Climate and 
Health Benefits from Emissions Reductions (billions 2020$) 
Catee:ory TSLl TSL2 TSLJ TSL4 TSL5 
3% discount rate for NPV of Consumer and Health Ben~f,ts (bi/,lion 2020$ 
5% d.r., Average SC-GHG case 3.7 11.8 15.3 18.5 33.9 
3% d.r., Average SC-GHG case 4.1 13.0 17.1 20.8 38.2 
2.5% d.r., Average SC-GHG case 4.4 13.9 18.4 22.5 41.3 
3% d.r., 95th percentile SC-GHG case 5.1 16.2 21.8 27.0 49.6 
7% discount rate for NPV of Consumer and Health Benefits (bi/,lion 2020$ 
5% d.r .. Average SC-GHG case 1.9 5.9 7.3 8.4 15.3 
3% d.r., Average SC-GHG case 2.3 7.1 9.0 10.7 19.6 
2.5% d.r. Average SC-GHG case 2.5 8.0 10.3 12.4 22.6 
3% d.r. 95th percentile SC-GHG case 3.3 10.4 13.8 16.9 30.9 20673 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
1. Benefits and Burdens of TSLs 
Considered for Room AC Standards 
Table V.56 and Table V.57 summarize 
the quantitative impacts estimated for each TSL for room ACs. The national impacts are measured over the lifetime of room ACs purchased in the 30-year period that begins in the anticipated year of compliance with amended 
standards (2026–2055). The energy savings, emissions reductions, and 
value of emissions reductions refer to full-fuel-cycle results. DOE exercises its own judgment in presenting monetized climate benefits as recommended in applicable Executive Orders and DOE would reach the same conclusion presented in this notice in the absence 
of the social cost of greenhouse gases, including the February 2021 Interim Estimates presented by the Interagency Working Group on the Social Cost of Greenhouse Gases. The efficiency levels contained in each TSL are described in section V.A of this document. 
BILLING CODE 6450–01–P 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00067 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420674 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00068 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.081</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.56 Summary of Analytical Results for Room Air Conditioner TSLs: 
National Im pacts 
Cate~ory TSL 1 TSL2 TSL3 TSL4 TSL5 
Cumulative FFC National Enerl!V Savim1:s ( auads) 
Quads 0.29 0.94 1.40 1.86 3.44 
Cumulative FFC Emissions Reduction (Total FFC Emissions) 
CO2 (million metric tons) 10.5 33.4 49.5 65.6 120.7 
S02 (thousand tons) 4.0 12.9 19.1 25.2 46.5 
NOx (thousand tons) 14.6 46.7 69.4 91.9 169.5 
Hg (tons) 0.0 0.1 0.1 0.1 OJ 
CH4 (thousand tons) 71.4 227.6 339.3 449.7 831.3 
N2O (thousand tons) 0.1 0.3 0.5 0.6 1.2 
Present Value of Monetized Benefits and Costs (3% discount rate billion 2020$) 
Consumer Operating Cost Savings 2.93 9.47 13.87 18.25 33.49 
Climate Benefits* 0.51 1.63 2.39 3.15 5.75 
Health Benefits** 0.88 2.83 4.14 5.44 9.88 
Total Benefitsj 4.32 13.92 20.41 26.85 49.12 
Consumer Incremental Product Costs:t 0.22 0.92 3.31 6.04 10.90 
Consumer Net Benefits 2.71 8.55 10.56 12.21 22.59 
Total Net Benefits 4.10 13.00 17.10 20.81 38.22 
Present Value of Moneti:,:ed Benefits and Costs (7% discount rate billion.\ 2020$ 
Consumer Operating Cost Savings 1.48 4.79 6.89 8.96 16.06 
Climate Benefits* 0.51 1.63 2.39 3.15 5.75 
Health Benefits** 0.39 1.27 1.82 2J6 4.19 
Total Benefitsj 2.38 7.68 11.10 14.48 25.99 
Consumer Incremental Product Costs! 0.12 0.54 2.05 3.75 6.42 
Consumer Net Benefits 1.35 4.25 4.83 5.21 9.64 
Total Net Benefits 2.25 7.14 9.05 10.73 19.58 
Note: This table presents the costs and benefits associated with room ACs shipped in 2026-2055. These results include 
benefits to consumers which accrue after 2055 from the products shipped in 2026-2055. 
* Climate benefits are calculated using four ditlerent estimates of the social cost of carbon (SC-CO2), methane (SC­
CH4), and nitrous oxide (SC-N2O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates; 95th 
percentile at 3 percent discount rate), as shown in Table V.50 through Table V.52. Together these represent the global 
social cost of greenhouse gases (SC-GHG ). For presentational purposes of this table, the climate benefits associated 
with the average SC-GHG at a 3 percent discount rate are shown, but the Depmtment does not have a single central SC­
GHG point estimate. See section IV.L of this document for more details. 
** Health benefits arc calculated using benefit-per-ton values for NOx and SO2. DOE is currently only monetizing (for 
802 and NOx) PM2 s pnxursor health benefits and (for NOx) ozone precursor health benefits, but will continue lo 
assess the ability to monetize other effects such as health benefits from reductions in direct PMz.s 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. 
i 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 
tl1e Department does not have a single central SC-GHG point estimate. DOE emphasizes tl1e importm1ce m1d value of 
considering the benefits calculated using all four SC-GHG estimates. See Table V.55 for net benefits using all four 
SC-GHG estimates. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22-30087) granted the federal 
govermnent's emergency motion for stay pending appeal of the Febmary 11, 2022, preliminary injunction issued in 
Louisiana v. Eiden, No. 21-cv-1074-JDC-KK (W.D. La.). As a result of the Fifth Circuit's order, fue preliminary 
injunction is no longer in effect, pending resolution of the federal government's appeal oftliat injunction or a fmther 
court order. Among other things, the preliminary injunction enjoined the defendants in that case from 
"adopting, employing, treating as binding, or relying upon" fue interin1 estin1ates of the social cost of greenhouse 
gases-which were issued by fue Interagency Working Group on the Social Cost of Greenhouse Gases on February 26, 
2021-to monetize fue benefits of reducing greenhouse gas emissions. In the absence of fmther intervening court 
orders, DOE will revert to its approach prior to the injunction and present monetized benefits where appropriate and 
permissible under law. 
:j: Costs include incremental equipment costs as well as installation costs. 20675 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00069 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.082</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.57 Summary of Analytical Results for Room Air Conditioner TSLs: 
M f dC I anu acturer an onsumer mpacts 
Category TSLl TSL2 TSL3 TSL4 TSL5 
Manufacturer Impacts 
Industry NPV (million 2020$) (No-new-1,072 1,053 1,016 968 611 
to to to to to standards case TNPV = 1,081) 1,075 1,078 1,165 1,247 992 
(0.8) (2.5) (6.0) (10.4) (43.5) 
Industry NPV (% change) to to to to to 
(0.5) (0.3) 7.8 15.4 (8.2) 
Consumer Avera!!e LCC Savin2s (2020$) 
PC 1: Room Air Conditioners, without reverse 
cycle, with louvered sides, and less than 6,000 $39.28 $63.49 $63.49 $45.25 $91.06 
Btu/h 
PC2: Room Air Conditioners, without reverse 
cycle, with louvered sides, and 6,000 to 7,999 $34.23 $80.02 $80.02 $62.00 $89.03 
Btu/h 
PC3: Room Air Conditioners, without reverse 
cycle, with louvered sides, and 8,000 to 13,999 $19.31 $104.92 $99.14 $99.14 $173.55 
Btu/h 
PC4: Room Air Conditioners, without reverse 
cycle, with louvered sides, and 14,000 to $0.00 $102.30 $97.49 $97.49 $176.00 
19,999 Btu/h 
PC5a: Room Air Conditioners, without reverse 
cycle, with louvered sides, and 20,000 to $5.28 $105.03 $152.52 $152.52 $263.67 
27,999 Btu/h 
PC5b: Room Air Conditioners, without reverse 
cycle, with louvered sides, and 28,000 Btu/h or $99.12 $147.14 $275.19 $275.19 $392.72 
more 
PC8a: Room Air Conditioners, without reverse 
cycle, without louvered sides, and 8,000 to $5.67 $85.72 $74.28 $74.28 $162.53 
10,999 Btu/h 
PC8b: Room Air Conditioners, without reverse 
cycle, without louvered sides, and 11,000 to $0.00 $100.02 $116.89 $116.89 $230.10 
13,999 Btu/h 
PC9: Room Air Conditioners, without reverse 
cycle, without louvered sides, and 14,000 to $58.37 $98.98 $162.64 $162.64 $227.85 
19,999 Btu/h 
PC 11: Room Air Conditioners, with reverse 
cycle, with louvered sides, and less than 20,000 $67.57 $131.52 $131.12 $131.12 $194.60 
Btu/h 
PC12: Room Air Conditioners, with reverse 
cycle, without louvered sides, and less than $39.97 $81.20 $122.74 $122.74 $156.81 
14,000 Btu/h 
PC16: Room Air Conditioners, Casement-$49.45 $104.75 $81.33 $81.33 $143.10 Slider 
Shipment-Weighted Average * $27.35 $85.73 $85.64 $76.04 $133.84 
Consumer Simple PBP (years) 
PC l: Room Air Conditioners, without reverse 
cycle, with louvered sides, and less than 6,000 0.6 0.7 0.7 4.6 3.8 
Btu/h 
PC2: Room Air Conditioners, without reverse 
cycle, with louvered sides, and 6,000 to 7,999 0.6 0.9 0.9 4.0 4.2 
Btu/h 20676 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00070 Fmt 4701 Sfmt 4725 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.083</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Category TSLl TSL2 TSL3 TSL4 TSL5 
PC3: Room Air Conditioners, without reverse 
cycle, with louvered sides, and 8,000 to 13,999 0.5 0.8 2.8 2.8 3.0 
Btu/h 
PC4: Room Air Conditioners, without reverse 
cycle, with louvered sides, and 14,000 to 0.6 0.7 2.9 2.9 2.8 
19,999 Btu/h 
PC5a: Room Air Conditioners, without reverse 
cycle, with louvered sides, and 20,000 to 1.2 1.0 2.6 2.6 2.7 
27,999 Btu/h 
PC5b: Room Air Conditioners, without reverse 
cycle, with louvered sides, and 28,000 Btu/h or 0.3 0.4 2.3 2.3 2.2 
more 
PC8a: Room Air Conditioners, without reverse 
cycle, without louvered sides, and 8,000 to 0.5 0.7 3.3 3.3 2.9 
10,999 Btu/h 
PC8b: Room Air Conditioners, without reverse 
cycle, without louvered sides, and 11,000 to 0.4 0.6 2.4 2.4 2.3 
13,999 Btu/h 
PC9: Room Air Conditioners, without reverse 
cycle, without louvered sides, and 14,000 to 0.9 0.9 2.8 2.8 2.7 
19,999 Btu/h 
PC 11: Room Air Conditioners, with reverse 
cycle, with louvered sides, and less than 20,000 0.6 0.8 3.2 3.2 3.2 
Btu/h 
PC12: Room Air Conditioners, with reverse 
cycle, without louvered sides, and less than 1.2 1.2 2.5 2.5 2.7 
14,000 Btu/h 
PC16: Room Air Conditioners, Casement-0.6 0.8 4.0 4.0 3.5 Slider 
Shiprnent-Weighted Average . 0.6 0.8 1.7 3.6 3.4 
Percent of Consumers that Experience a Net Cost 
PC 1: Room Air Conditioners, without reverse 
cycle, with louvered sides, and less than 6,000 1% 3% 3% 40% 32% 
Btu/h PC2: Room Air Conditioners, without reverse 
cycle, with louvered sides, and 6,000 to 7,999 
2% 5% 5% 40% 43% 
Btu/h 
PC3: Room Air Conditioners, without reverse 
cycle, with louvered sides, and 8,000 to 13,999 0% 4% 30% 30% 30% 
Btu/h 
PC4: Room Air Conditioners, without reverse 
cycle, with louvered sides, and 14,000 to 0% 1% 35% 35% 32% 
19,999 Btu/h 
PC5a: Room Air Conditioners, without reverse 
cycle, with louvered sides, and 20,000 to 1% 2% 32% 32% 34% 
27,999 Btu/h 
PC5b: Room Air Conditioners, without reverse 
cycle, with louvered sides, and 28,000 Btu/h or 0% 0% 24% 24% 25% 
more 
PC8a: Room Air Conditioners, without reverse 0% 4% 37% 37% 29% 
cycle, without louvered sides, and 8,000 to 
10,999 Btu/h 
PC8b: Room Air Conditioners, without reverse 0% 3% 26% 26% 23% 
cycle, without louvered sides, and 11,000 to 
13,999 Btu/h 20677 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
BILLING CODE 6450–01–C 
DOE first considered TSL 5, which 
represents the max-tech efficiency 
levels. TSL 5 would save an estimated 3.44 quads of energy, an amount DOE considers significant. Under TSL 5, the NPV of consumer benefit would be $9.64 billion using a discount rate of 7 percent, and $22.59 billion using a discount rate of 3 percent. 
The cumulative emissions reductions 
at TSL 5 are 120.7 Mt of CO
2, 46.5 
thousand tons of SO 2, 169.5 thousand 
tons of NO X, 0.3 tons of Hg, 831.3 
thousand tons of CH 4, and 1.2 thousand 
tons of N 2O. The estimated monetary 
value of the GHG emissions reduction (associated with the average SC–GHG at a 3-percent discount rate) at TSL 5 is $5.75 billion. The estimated monetary value of the health benefits from reduced SO
2and NO Xemissions at TSL 
5 is $4.19 billion using a 7-percent 
discount rate and $9.88 billion using a 3-percent discount rate. 
Using a 7-percent discount rate for 
consumer benefits and costs, health benefits from reduced SO
2and NO X 
emissions, and the 3-percent discount rate case for climate benefits from reduced GHG emissions, the estimated combined monetized NPV at TSL 5 is $19.58 billion. Using a 3-percent discount rate for all consumer and emissions benefits and costs, the estimated combined monetized NPV at TSL 5 is $38.22 billion. The estimated total monetized NPV is provided for additional information; however, DOE primarily relies upon the consumer NPV when determining whether a standard level is economically justified. 
At TSL 5, the shipment-weighted 
average LCC savings is $133.84. The simple payback period is 3.4 years. The fraction of consumers experiencing a net LCC cost is 33 percent. 
At TSL 5, the projected change in 
manufacturer INPV ranges from a decrease of $470.1 million to a decrease of $88.4 million, which corresponds to decreases of 43.5 percent and 8.2 percent, respectively. At this level, free cash flow is estimated to decrease by 291.7 percent compared to the base-case value in the year before the standards year. Conversion costs total $475.9 million. 
As discussed in sections IV.C.1–2 of 
this document, DOE believes there is uncertainty regarding the estimated compressor cost and availability of the highest efficiency variable-speed compressors across the full range of capacities at TSL 5, particularly in the smaller capacity room ACs. These uncertainties stem from the fact that the efficiency level for TSL 5 is obtained by using the highest efficiency variable- speed compressors that are currently available to be incorporated into room ACs at the time the analysis was competed. In addition, variable speed compressors representing these efficiencies are manufactured by just one manufacturer. It is unclear whether the highest efficiency variable-speed compressors will be available to all manufacturers of room ACs since there is only a single supplier at this time. In addition, these highest efficiency variable-speed compressors are not currently available in the full range of capacities, which could limit the current product offerings by manufacturers. Furthermore, due to the single supplier for these highest efficiency variable-speed compressors and their unknown manufacturing volume and potential bottlenecks for ramp-up manufacturing capabilities, there is a likelihood that there may not be sufficient supply to meet the demand of the market for the full range of cooling capacities for room ACs, should TSL 5 be selected. This may have the potential to eliminate room ACs of certain cooling capacities from the market as well impact the overall number of room ACs available on the market should TSL 5 be selected. 
The Secretary tentatively concludes 
that at TSL 5 for room ACs, the benefits of energy savings, positive NPV of consumer benefits, emission reductions, and the estimated monetary value of the climate and health benefits would be outweighed by the impacts on manufacturers, including the conversion costs and profit margin impacts that could result in a large reduction in INPV, and the potential for product unavailability due to limitations in key components such as the highest efficiency variable-speed compressors necessary to reach the max-tech efficiency levels. Consequently, the Secretary has tentatively concluded that TSL 5 is not economically justified. 
Then DOE considered TSL 4. TSL 4 
would save an estimated 1.86 quads of energy, an amount DOE considers significant. Under TSL 4, the NPV of consumer benefit would be $5.21 billion using a discount rate of 7 percent, and $12.21 billion using a discount rate of 3 percent. 
The cumulative emissions reductions 
at TSL 4 are 65.6 Mt of CO
2, 25.2 
thousand tons of SO 2, 91.9 thousand 
tons of NO X, 0.1 tons of Hg, 449.7 
thousand tons of CH 4, and 0.6 thousand 
tons of N 2O. The estimated monetary 
value of the GHG emissions reduction (associated with the average SC–GHG at a 3-percent discount rate) at TSL 4 is $3.15 billion. The estimated monetary value of the health benefits from reduced SO
2and NO Xemissions at TSL 
4 is $2.36 billion using a 7-percent discount rate and $5.44 billion using a 3-percent discount rate. 
Using a 7-percent discount rate for 
consumer benefits and costs, health benefits from reduced SO
2and NO X 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00071 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.084</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Category TSLl TSL2 TSL3 TSL4 TSL5 
PC9: Room Air Conditioners, without reverse 3% 2% 24% 24% 24% 
cycle, without louvered sides, and 14,000 to 
19,999 Btu/h 
PC 11: Room Air Conditioners, with reverse 2% 4% 30% 30% 31% 
cycle, with louvered sides, and less than 20,000 
Btu/h 
PC12: Room Air Conditioners, with reverse 7% 7% 20% 20% 24% 
cycle, without louvered sides, and less than 
14,000 Btu/h 
PC16: Room Air Conditioners, Casement- 2% 4% 38% 38% 34% 
Slider 
Shipment-Weighted Average * 1% 3% 16% 36% 33% 
Parentheses indicate negative (-) values. 
* Weighted by shares of each product class in total projected shipments in 2026. 20678 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
emissions, and the 3-percent discount 
rate case for climate benefits from reduced GHG emissions, the estimated combined monetized NPV at TSL 4 is $10.73 billion. Using a 3-percent discount rate for all consumer and emissions benefits and costs, the estimated combined monetized NPV at TSL 4 is $20.81 billion. The estimated total monetized NPV is provided for additional information; however, DOE primarily relies upon the consumer NPV when determining whether a standard level is economically justified. 
At TSL 4, the shipment-weighted 
average LCC impact is a savings of $76.04. The shipment-weighted simple payback period is 3.6 years. The fraction of consumers experiencing a net LCC cost is 36 percent. 
At TSL 4, the projected change in 
manufacturer INPV ranges from a decrease of $112.9 million to an increase of $166.5 million, which corresponds to a decrease of 10.4 percent and an increase of 15.4 percent, respectively. At this level, free cash flow is estimated to decrease by 13.5 percent compared to the base-case value in the year before the standards year. Conversion costs total $26.7 million. 
TSL 4 represents commercially 
available room ACs that implement variable-speed compressors, based on models with cooling capacities greater than 8,000 Btu/h. However, for room ACs with the smallest cooling capacities (i.e., less than 8,000 Btu/h), 
uncertainties exist regarding both the availability of variable-speed compressors that can be integrated into these smaller-size units and the feasibility of incorporating these variable-speed compressors with related components into a more space- constrained chassis than for larger- capacity room ACs. There are no models commercially available that incorporate variable-speed compressors for cooling capacities less than 8,000 Btu/h, and the uncertainties may have the potential to eliminate room ACs with the smallest 
cooling capacities from the market, should TSL 4 be selected. While there are similarly no room ACs currently on the market with variable-speed compressors at cooling capacities greater than 22,000 Btu/h, other air conditioning products with such cooling capacities (e.g., mini-split air 
conditioners) do exist in the U.S. market, thereby not giving rise to the same uncertainties as for the smallest cooling capacities. 
The Secretary tentatively concludes 
that at TSL 4 for room ACs, the benefits of energy savings, positive NPV of consumer benefits, emission reductions, and the estimated monetary value of the climate and health benefits would be 
outweighed by the impacts on manufacturers, including the conversion costs and profit margin impacts that could result in a reduction in INPV and potential unavailability of key components for small-capacity product classes. Consequently, the Secretary has tentatively concluded that TSL 4 is not economically justified. 
DOE then considered TSL 3, which 
would save an estimated 1.40 quads of energy, an amount DOE considers significant. Under TSL 3, the NPV of consumer benefit would be $4.83 billion using a discount rate of 7 percent, and $10.56 billion using a discount rate of 3 percent. 
The cumulative emissions reductions 
at TSL 3 are 49.5 Mt of CO
2, 19.1 
thousand tons of SO 2, 69.4 thousand 
tons of NO X, 0.1 tons of Hg, 339.3 
thousand tons of CH 4, and 0.5 thousand 
tons of N 2O. The estimated monetary 
value of the climate benefits from reduced GHG emissions (associated with the average SC–GHG at a 3-percent discount rate) at TSL 3 is $2.39 billion. The estimated monetary value of the health benefits from reduced SO
2and 
NO Xemissions at TSL 3 is $1.82 billion 
using a 7-percent discount rate and $4.14 billion using a 3-percent discount rate. 
Using a 7-percent discount rate for 
consumer benefits and costs, SO
2 
reduction benefits, and NO Xreduction 
benefits, and the 3-percent discount rate 
for GHG social costs, the estimated combined monetized NPV at TSL 3 is $9.05 billion. Using a 3-percent discount rate for all consumer and emissions benefits and costs, the estimated combined monetized NPV at TSL 3 is $17.10 billion. The estimated total monetized NPV is provided for additional information; however, DOE primarily relies upon the consumer NPV when determining whether a standard level is economically justified. 
At TSL 3, the shipment-weighted 
average LCC impact is a savings of $85.64. The shipment-weighted simple payback period is 1.7 years. The fraction of consumers experiencing a net LCC cost is 16 percent. 
At TSL 3, the projected change in 
manufacturer INPV ranges from a decrease of $64.5 million to an increase of $84.1 million, which corresponds to a decrease of 6.0 percent and an increase of 7.8 percent, respectively. At this level, free cash flow is estimated to decrease by 11.7 percent compared to the base-case value in the year before the standards year. Conversion costs total $22.8 million. 
After considering the analysis and 
weighing the benefits and burdens, the Secretary has tentatively concluded that 
a standard set at TSL 3 for room ACs would be economically justified. At this TSL, the average LCC savings for room AC consumers is positive. An estimated 16 percent of room AC consumers would experience a net cost. The FFC national energy savings are significant and the NPV of consumer benefits is positive using both a 3-percent and 7-percent discount rate. Notably, the benefits to consumers vastly outweigh the cost to manufacturers. At TSL 3, the NPV of consumer benefits, even measured at the more conservative discount rate of 7 percent, is over 75 times higher than the maximum estimated manufacturers’ loss in INPV. The positive LCC savings—a different way of quantifying consumer benefits— reinforces this conclusion. The standard levels at TSL 3 are economically justified even without weighing the estimated monetary value of emissions reductions. When those monetized climate benefits from GHG emissions reductions and health benefits from SO
2 
and NO Xemissions reductions are 
included—representing $2.39 billion in climate benefits (associated with the average SC–GHG at a 3-percent discount rate), and $4.14 billion (using a 3-percent discount rate) or $1.82 billion (using a 7-percent discount rate) in health benefits—the rationale becomes stronger still. 
As stated, DOE conducts a ‘‘walk- 
down’’ analysis to determine the TSL that represents the maximum improvement in energy efficiency that is technologically feasible and economically justified as required under EPCA. The walk-down is not a comparative analysis, as a comparative analysis would result in the maximization of net benefits instead of energy savings that are technologically feasible and economically justified and would be contrary to the statute. 86 FR 70892, 70908. Although DOE has not conducted a comparative analysis to select the proposed energy conservation standards, DOE notes that as compared to TSL 4 and TSL 5, TSL 3 has higher average LCC savings, smaller percentages of consumer experiencing a net cost, a lower maximum decrease in INPV, and lower manufacturer conversion costs. 
Accordingly, the Secretary has 
tentatively concluded that TSL 3 would offer the maximum improvement in efficiency that is technologically feasible and economically justified and would result in the significant conservation of energy. Although results are presented here in terms of TSLs, 
DOE analyzes and evaluates all possible ELs for each product class in its 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00072 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420679 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
analysis. For room ACs with cooling 
capacities greater than or equal to 8,000 Btu/h, TSL 3 corresponds to EL 4, the highest efficiency level below max-tech, incorporating commercially available variable-speed compressors. The variable-speed compressor required to achieve the max-tech efficiency level is currently available from only a single manufacturer, leading to the likelihood there may not be sufficient supply at that efficiency level to meet the demand of the market for the full range of cooling capacities for room ACs. For room ACs with cooling capacities less than 8,000 Btu/h, TSL 3 corresponds to EL 3, incorporating the maximum available energy efficient single-speed compressors. Both EL 4 and EL 5 for room ACs with cooling capacities less than 8,000 Btu/h incorporate variable- speed compressors based off of modeling of available compressors for models with cooling capacities greater than or equal to 8,000 Btu/h. Uncertainties exist at those efficiency levels regarding both the availability of variable-speed compressors that can be integrated into these smaller-size units and the feasibility of incorporating these variable-speed compressors with related components into a more space- constrained chassis than for larger- capacity room ACs. There are no models commercially available that incorporate variable-speed compressors for cooling capacities less than 8,000 Btu/h. The proposed standard levels at TSL 3 results in positive LCC savings for all product classes, significantly reduce the number of consumers experiencing a net cost, and reduce the decrease in INPV and conversion costs to the point where DOE has tentatively concluded they are economically justified, as discussed for TSL 3 in the preceding paragraphs. 
Therefore, based on the previous 
considerations, DOE proposes to adopt the energy conservation standards for room ACs at TSL 3. The proposed amended energy conservation standards for room ACs, which are expressed as CEER and include the rounded cooling capacity product class descriptions discussed in section IV.A.1 of this document, are shown in Table V.58. 
BILLING CODE 6450–01–P 
2. Annualized Benefits and Costs of the 
Proposed Standards 
The benefits and costs of the proposed 
standards can also be expressed in terms of annualized values. The annualized 
net benefit is (1) the annualized national economic value (expressed in 2020$) of the benefits from operating products that meet the proposed standards (consisting primarily of operating cost 
savings from using less energy, minus increases in product purchase costs, and (2) the annualized monetary value of the 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00073 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.085</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.58 Proposed Amended Energy Conservation Standards for Room Air 
Conditioners for TSL 3 
Product Class Proposed Standard 
CEER(Btu/h) 
Room AC without reverse cycle, with louvered sides 
<6,000 Btu/h (1) 13.1 
6,000 to 7,900 Btu/h (2) 13.7 
8,000 to 13,900 Btu/h (3) 16.0 
14,000 to 19,900 Btu/h (4) 16.0 
20,000 to 27,900 Btu/h (Sa) 13.8 
2:28,000 Btu/h (Sb) 13.2 
Room AC without reverse cycle, without louvered sides 
<6,000 Btu/h (6) 12.8 
6,000 to 7,900 Btu/h (7) 12.8 
8,000 to 10,900 Btu/h (8a) 14.1 
11,000 to 13,900 Btu/h (8b) 13.9 
14,000 to 19,900 Btu/h (9) 13.7 
2:20,000 Btu/h (10) 13.8 
Room AC with reverse cycle, with louvered sides 
<20,000 Btu/h (11) 14.4 
2:20,000 Btu/h (13) 13.7 
Room AC with reverse cycle, without louvered sides 
<14,000 Btu/h (12) 13.7 
2:14,000 Btu/h (14) 12.8 
Casement 
Casement-Only (15) 13.9 
Casement-Slider (16) 15.3 20680 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
benefits of GHGs, NO X,and SO 2 
emission reductions. 
Table V.59 shows the annualized 
values for room ACs under TSL 3, 
expressed in 2020$. 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 SO
2and NO X, 
and the 3-percent discount rate case for climate benefits from reduced GHG emissions, the estimated cost of the 
proposed standards for room ACs is $216.9 million per year in increased equipment costs, while the estimated annual benefits are $727.5 million in reduced operating costs, $137.5 million in climate benefits, and $192.1 million in monetized health benefits. In this case, the net monetized benefit amounts to $840.2 million per year. Using a 3-percent discount rate for all 
benefits and costs, the estimated cost of 
the proposed standards for room ACs is $190.1 million per year in increased equipment costs, while the estimated annual benefits are $796.7 million in reduced operating costs, $137.5 million in climate benefits, and $237.9 million in monetized health benefits. In this case, the net monetized benefit amounts to $982.0 million per year. 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00074 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420681 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
BILLING CODE 6450–01–C 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00075 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4
EP07AP22.086</GPH>khammond on DSKJM1Z7X2PROD with PROPOSALS4Table V.59 Annualized Benefits and Costs of Proposed Energy Conservation 
Standards for Room Air Conditioners (TSL 3) 
Million 2020$/year 
Primary Estimate Low-Net-Benefits High-Net-
Estimate Benefits Estimate 
3% discount rate 
Consumer Operating Cost Savings 796.7 751.9 847.8 
Climate Benefits* 137.5 134.2 140.4 
Health Benefits** 237.9 232.3 242.7 
Total Benefitst 1,172.0 1,118.4 1,230.9 
Consumer Incremental Product Costst 190.1 213.2 163.1 
Net Benefits 982.0 905.2 1,067.7 
7% discount rate 
Consumer Operating Cost Savings 727.5 693.3 768.4 
Climate Benefits* 137.5 134.2 140.4 
Health Benefits** 192.1 188.1 195.7 
Total Benefitst 1,057.1 1,015.6 1,104.4 
Consumer Incremental Product Costst 216.9 240.0 190.0 
Net Benefits 840.2 775.7 914.5 
Note: This table presents the costs and benefits associated ,vith roomACs shipped in 2026-2055. These results include 
benefits to consumers which accrue after 2055 from the products shipped in 2026-2055. 
* Climate benefits are calculated using four different estimates of the social cost of carbon (SC-CO2), methane (SC­
CH4), and nitrous oxide (SC-N2O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates; 95th 
percentile at 3 percent discount rate). Together these represent the global social cost of greenhouse gases (SC-GHG ). 
For presentational purposes of this table, the climate benefits associated with the average SC-GHG at a 3 percent 
discounl rale are shown, bul lhe Deparlmenl does nol have a single cenlntl SC-GHG poinl eslimale, and il emphasizes 
the importance and value of considering the benefits calculated using all four SC-GHG estimates. See section IV.L of 
this document for more details. 
** 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 docU111ent for more details. t Total and net benefits include consU111er, 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 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 ofthe February 
11, 2022, preliminary injunction issued in Louisiana v. Eiden, 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 eitjoined 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. In the 
absence of further intervening court orders, DOE will revert to its approach prior to the injunction and present 
monetized benefits where appropriate and permissible under law. 
i Costs include incremental equipment costs as well as installation costs. 20682 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
VI. Cooling Capacity Verification 
DOE is proposing to add the cooling 
capacity of room ACs to 10 CFR 429.134 
to help regulated entities understand how DOE will determine the product class that applies to a given basic model in the context of an enforcement investigation. DOE is proposing a similar approach that it has adopted for portable air conditioners, packaged terminal air conditioners and heat pumps, and dehumidifiers. More specifically, DOE is going to compare the mean of the tested cooling capacity from the units of a given basic model that DOE has tested for enforcement rounded to the nearest hundred to the certified cooling capacity by the manufacturer. DOE will use the certified cooling capacity of the manufacturer if the mean of the DOE tested units is within 5 percent of the certified cooling capacity. If the manufacturer does not have a valid certification, including if the certified cooling capacity was incorrectly certified, or the certified cooling capacity is found to be outside of the 5 percent tolerance, DOE will use the rounded mean of the DOE tested units within the enforcement sample to determine the applicable product class and energy conservation standard for this particular basic model. DOE believes these proposed provisions provide additional clarity and transparency to the enforcement process. The proposal can be found in 10 CFR 429.134 and DOE seeks 
comment on this approach. 
VII. Procedural Issues and Regulatory 
Review 
A. Review Under Executive Orders 
12866 and 13563 
Section 1(b)(1) of Executive Order 
(‘‘E.O.’’) 12866, ‘‘Regulatory Planning and Review,’’ 58 FR 51735 (Oct. 4, 1993), requires each agency to identify the problem that it intends to address, including, where applicable, the failures of private markets or public institutions that warrant new agency action, as well as to assess the significance of that problem. The problems that the proposed standards set forth in this NOPR are intended to address are as follows: 
(1) Insufficient information and the high 
costs of gathering and analyzing relevant 
information leads some consumers to miss opportunities to make cost-effective investments in energy efficiency. 
(2) In some cases, the benefits of more- 
efficient equipment are not realized due to misaligned incentives between purchasers and users. An example of such a case is when the equipment purchase decision is made by a building contractor or building owner who does not pay the energy costs. (3) There are external benefits resulting 
from improved energy efficiency of 
appliances and equipment that are not captured by the users of such products. These benefits include externalities related to public health, environmental protection, and national energy security that are not reflected in energy prices, such as reduced emissions of air pollutants and greenhouse gases that impact human health and global warming. 
The Administrator of the Office of 
Information and Regulatory Affairs 
(‘‘OIRA’’) in the OMB has determined that the proposed regulatory action is a significant regulatory action under section (3)(f) of Executive Order 12866. Accordingly, pursuant to section 6(a)(3)(B) of the Order, DOE has provided to OIRA: (i) The text of the draft regulatory action, together with a reasonably detailed description of the need for the regulatory action and an explanation of how the regulatory action will meet that need; and (ii) An assessment of the potential costs and benefits of the regulatory action, including an explanation of the manner in which the regulatory action is consistent with a statutory mandate. DOE has included these documents in the rulemaking record. 
In addition, the Administrator of 
OIRA has determined that the proposed regulatory action is an ‘‘economically’’ significant regulatory action under section (3)(f)(1) of E.O. 12866. Accordingly, pursuant to section 6(a)(3)(C) of the Order, DOE has provided to OIRA an assessment, including the underlying analysis, of benefits and costs anticipated from the 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 can be found in the technical support document for this proposed rulemaking. 
DOE has also reviewed this regulation 
pursuant to E.O. 13563, issued on January 18, 2011. 76 FR 3281 (Jan. 21, 2011). E.O. 13563 is supplemental to and explicitly reaffirms the principles, structures, and definitions governing regulatory review established in E.O. 12866. To the extent permitted by law, agencies are required by E.O. 13563 to (1) propose or adopt a regulation only upon a reasoned determination that its benefits justify its costs (recognizing that some benefits and costs are difficult to quantify); (2) tailor regulations to impose the least burden on society, consistent with obtaining regulatory objectives, taking into account, among 
other things, and to the extent practicable, the costs of cumulative regulations; (3) select, in choosing among alternative regulatory approaches, those approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity); (4) to the extent feasible, specify performance objectives, rather than specifying the behavior or manner of compliance that regulated entities must adopt; and (5) identify and assess available alternatives to direct regulation, including providing economic incentives to encourage the desired behavior, such as user fees or marketable permits, or providing information upon which choices can be made by the public. 
DOE emphasizes as well that 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, OIRA has emphasized that such techniques may include identifying changing future compliance costs that might result from technological innovation or anticipated behavioral changes. For the reasons stated in the preamble, this NOPR is consistent with these principles, including the requirement that, to the extent permitted by law, benefits justify costs and that net benefits are maximized. 
B. Review Under the Regulatory 
Flexibility Act 
The Regulatory Flexibility Act (5 
U.S.C. 601 et seq.) requires preparation of an initial regulatory flexibility analysis (‘‘IRFA’’) for any rule that by law must be proposed for public comment, unless the agency certifies that the rule, if promulgated, will not 
have a significant economic impact on a substantial number of small entities. As required by E.O. 13272, ‘‘Proper Consideration of Small Entities in Agency Rulemaking,’’ 67 FR 53461 (Aug. 16, 2002), DOE published procedures and policies on February 19, 2003, to ensure that the potential impacts of its rules on small entities are properly considered during the rulemaking process. 68 FR 7990. DOE has made its procedures and policies available on the Office of the General Counsel’s website (energy.gov/gc/office- general-counsel). 
DOE reviewed this proposed rule 
under the provisions of the Regulatory Flexibility Act and the procedures and policies published on February 19, 2003. DOE certifies that the proposed 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00076 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420683 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
78regulations.doe.gov/certification-data/ 
#q=Product_ Group_ s%3A*. 
79cacertappliances.energy.ca.gov/Pages/ 
ApplianceSearch.aspx. 
80energystar.gov/productfinder/. 
81app.dnbhoovers.com. 
82https://www.rheem.com/about/news-releases/ 
rheem-acquires-friedrich-air-conditioning 
(published August 30, 2021). rule, if adopted, would not have 
significant economic impact on a substantial number of small entities. The factual basis of this certification is set forth in the following paragraphs. 
In accordance with EPCA, DOE is 
publishing this NOPR as part of the legislated 6-year review of energy conservation standards for room ACs. (42 U.S.C. 6295(m)) The current room AC energy conservation standards were implemented by a direct final rule published on April 21, 2011 (76 FR 22454) and subsequently confirmed on August 24, 2011. 76 FR 52854. Compliance with those standards has been required since June 1, 2014. 76 FR 52852. 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)) 
For manufacturers of room ACs, the 
Small Business Administration (‘‘SBA’’) has set a size threshold, which defines those entities classified as ‘‘small businesses’’ for the purposes of the statute. DOE used the SBA’s small business size standards to determine whether any small entities would be subject to the requirements of the rule. (See 13 CFR part 121.) The size 
standards are listed by North American Industry Classification System (‘‘NAICS’’) code and industry description and are available at www.sba.gov/document/support--table- size-standards. Manufacturing of room 
ACs is classified under NAICS 333415, ‘‘Air-Conditioning and Warm Air Heating Equipment and Commercial and Industrial Refrigeration Equipment Manufacturing.’’ The SBA sets a 
threshold of 1,250 employees or fewer for an entity to be considered as a small business for this category. 
To estimate the number of companies 
that could be small business manufacturers of products covered by this proposed rulemaking, DOE conducted a market survey using public information and subscription-based company reports to identify potential small manufacturers. DOE’s research 
involved DOE’s Compliance Certification Database (‘‘CCD’’),
78 
California Energy Commission’s Modernized Appliance Efficiency Database System (‘‘MAEDbS’’),
79 
ENERGY STAR Product Finder,80 
individual company websites, and market research tools (e.g., reports from 
Dun & Bradstreet
81) to create a list of 
companies that manufacture, produce, import, or assemble the products covered by this rulemaking. DOE also asked stakeholders and industry representatives if they were aware of any other small manufacturers during manufacturer interviews and at DOE public meetings. 
DOE identified eight OEMs of room 
AC products sold in the United States. Upon initial review, one OEM was 
identified as a small manufacturer based in the United States. However, in August 2021, a large manufacturer acquired the small manufacturer.
82 
Following that acquisition, no domestic room AC OEMs qualify as a small business. Given the lack of small entities with a direct compliance burden, DOE certifies that the proposed rule would not have ‘‘a significant economic impact on a substantial number of small entities.’’ DOE requests comment on this certification conclusion. 
DOE has submitted a certification and 
supporting statement of factual basis to the Chief Counsel for Advocacy of the Small Business Administration for review under 5 U.S.C. 605(b). 
C. Review Under the Paperwork 
Reduction Act 
Manufacturers of room ACs must 
certify to DOE that their products comply with any applicable energy conservation standards. In certifying compliance, manufacturers must test their products according to the DOE test procedures for room ACs, including any amendments adopted for those test procedures. DOE has established regulations for the certification and recordkeeping requirements for all covered consumer products and commercial equipment, including room ACs. 76 FR 12422 (Mar. 7, 2011); 80 FR 5099 (Jan. 30, 2015). The collection-of- information requirement for the certification and recordkeeping is subject to review and approval by OMB 
under the Paperwork Reduction Act (‘‘PRA’’). This requirement has been approved by OMB under OMB control number 1910–1400. Public reporting burden for the certification is estimated to average 35 hours per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. 
Notwithstanding any other provision 
of the law, no person is required to respond to, nor shall any person be subject to a penalty for failure to comply with, a collection of information subject to the requirements of the PRA, unless that collection of information displays a currently valid OMB Control Number. 
D. Review Under the National 
Environmental Policy Act of 1969 
DOE is analyzing this proposed 
regulation in accordance with the National Environmental Policy Act of 1969 (‘‘NEPA’’) and DOE’s NEPA implementing regulations (10 CFR part 1021). DOE’s regulations include a categorical exclusion for rulemakings that establish energy conservation standards for consumer products or industrial equipment. 10 CFR part 1021, subpart D, appendix B5.1. DOE anticipates that this rulemaking qualifies for categorical exclusion B5.1 because it is a rulemaking that 
establishes energy conservation standards for consumer products or industrial equipment, none of the exceptions identified in categorical exclusion B5.1(b) apply, no extraordinary circumstances exist that require further environmental analysis, and it otherwise meets the requirements for application of a categorical exclusion. See 10 CFR 1021.410. DOE will complete its NEPA review before issuing the final rule. 
E. Review Under Executive Order 13132 
E.O. 13132, ‘‘Federalism,’’ 64 FR 
43255 (Aug. 10, 1999), imposes certain 
requirements on Federal agencies formulating and implementing policies or regulations that preempt State law or that have federalism implications. The Executive order requires agencies to examine the constitutional and statutory authority supporting any action that would limit the policymaking discretion of the States and to carefully assess the necessity for such actions. The Executive order also requires agencies to have an accountable process to ensure meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications. On March 14, 2000, DOE 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00077 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420684 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
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 rule meets the relevant standards of E.O. 12988. G. Review Under the Unfunded 
Mandates Reform Act of 1995 
Title II of the Unfunded Mandates 
Reform Act of 1995 (‘‘UMRA’’) requires each Federal agency to assess the effects of Federal regulatory actions on State, local, and Tribal governments and the private sector. Public Law 104–4, section 201 (codified at 2 U.S.C. 1531). For a proposed regulatory action likely to result in a rule that may cause the expenditure by State, local, and Tribal governments, in the aggregate, or by the private sector of $100 million or more in any one year (adjusted annually for inflation), section 202 of UMRA requires a Federal agency to publish a written statement that estimates the resulting costs, benefits, and other effects on the national economy. (2 U.S.C. 1532(a), (b)) The UMRA also requires a Federal agency to develop an effective process to permit timely input by elected officers of State, local, and Tribal governments on a proposed ‘‘significant intergovernmental mandate,’’ and requires an agency plan for giving notice and opportunity for timely input to potentially affected small governments before establishing any requirements that might significantly or uniquely affect them. On March 18, 1997, DOE published a statement of policy on its process for intergovernmental consultation under UMRA. 62 FR 12820. DOE’s policy statement is also available at energy.gov/sites/prod/files/ gcprod/documents/umra_ 97.pdf. 
Although this proposed rule does not 
contain a Federal intergovernmental mandate, it may require expenditures of $100 million or more in any one year by the private sector. Such expenditures may include: (1) Investment in research and development and in capital expenditures by room AC 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 room ACs, 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 room ACs 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 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00078 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420685 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
83The 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. 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 room ACs, 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 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.
83 
Generation of this report involved a rigorous, formal, and documented evaluation using objective criteria and qualified and independent reviewers to make a judgment as to the technical/ scientific/business merit, the actual or anticipated results, and the productivity and management effectiveness of programs and/or projects. DOE has determined that the peer-reviewed analytical process continues to reflect current practice, and the Department followed that process for developing energy conservation standards in the case of the present rulemaking. 
VIII. Public Participation 
A. Attendance at the Webinar 
The time, date, and location of the 
webinar are listed in the 
DATES and 
ADDRESSES sections at the beginning of 
this document. If no participants 
register for the webinar then it will be cancelled. Webinar registration information, participant instructions, and information about the capabilities available to webinar participants will be published on DOE’s website: https://www1.eere.energy.gov/buildings/appliance_ standards/standards.aspx?
productid=52. 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. Requests may be sent by email to the Appliance and Equipment Standards Program, U.S. Department of 
Energy, Building Technologies Office, Mailstop EE–5B 1000 Independence Avenue SW, Washington, DC 20585– 0121, or 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. 
Persons requesting to speak should 
briefly describe the nature of their interest in this rulemaking and provide a telephone number for contact. 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 Public Meeting 
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/public 
meeting. 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/public meeting, interested parties may submit further comments on the proceedings, as well as on any aspect of the rulemaking, until the end of the comment period. 
The public meeting will be conducted 
in an informal, conference style. DOE will present summaries of comments received before the webinar/public meeting, 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 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00079 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420686 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
determined by DOE), before the 
discussion of specific topics. DOE will allow, as time permits, other participants to comment briefly on any general statements. 
At the end of all prepared statements 
on a topic, DOE will permit participants to clarify their statements briefly. Participants should be prepared to answer questions by DOE and by other participants concerning these issues. DOE representatives may also ask questions of participants concerning other matters relevant to this rulemaking. The official conducting the webinar/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/public meeting. 
A transcript of the webinar/public 
meeting will be included in the docket, which can be viewed as described in the Docket section at the beginning of this 
document and will be accessible on the DOE website. In addition, any person may buy a copy of the transcript from the transcribing reporter. 
D. Submission of Comments 
DOE will accept comments, data, and 
information regarding this proposed 
rule before or after the public meeting, but no later than the date provided in the 
DATES section at the beginning of 
this proposed rule. Interested parties may submit comments, data, and other information using any of the methods described in the 
ADDRESSES section at 
the beginning of this document. 
Submitting comments via 
www.regulations.gov. The 
www.regulations.gov web page will 
require you to provide your name and contact information. Your contact information will be viewable to DOE Building Technologies staff only. Your contact information will not be publicly viewable except for your first and last names, organization name (if any), and submitter representative name (if any). If your comment is not processed properly because of technical difficulties, DOE will use this information to contact you. If DOE cannot read your comment due to technical difficulties and cannot contact you for clarification, DOE may not be able to consider your comment. 
However, your contact information 
will be publicly viewable if you include it in the comment itself or in any documents attached to your comment. Any information that you do not want to be publicly viewable should not be included in your comment, nor in any document attached to your comment. 
Otherwise, persons viewing comments will see only first and last names, organization names, correspondence containing comments, and any documents submitted with the comments. 
Do not submit to www.regulations.gov 
information for which disclosure is restricted by statute, such as trade secrets and commercial or financial information (hereinafter referred to as Confidential Business Information (‘‘CBI’’)). Comments submitted through www.regulations.gov cannot be claimed 
as CBI. Comments received through the website will waive any CBI claims for the information submitted. For information on submitting CBI, see the Confidential Business Information section. 
DOE processes submissions made 
through www.regulations.gov before 
posting. Normally, comments will be posted within a few days of being submitted. However, if large volumes of comments are being processed simultaneously, your comment may not be viewable for up to several weeks. Please keep the comment tracking number that www.regulations.gov provides after you have successfully uploaded your comment. 
Submitting comments via email. 
Comments and documents submitted via email also will be posted to 
www.regulations.gov. If you do not want 
your personal contact information to be publicly viewable, do not include it in your comment or any accompanying documents. Instead, provide your contact information in a cover letter. Include your first and last names, email address, telephone number, and optional mailing address. The cover letter will not be publicly viewable as long as it does not include any comments. 
Include contact information each time 
you submit comments, data, documents, and other information to DOE. No telefacsimiles (‘‘faxes’’) will be accepted. 
Comments, data, and other 
information submitted to DOE electronically should be provided in PDF (preferred), Microsoft Word or Excel, WordPerfect, or text (ASCII) file format. Provide documents that are not secured, that are written in English, and that are free of any defects or viruses. Documents should not contain special characters or any form of encryption and, if possible, they should carry the electronic signature of the author. 
Campaign form letters. Please submit 
campaign form letters by the originating organization in batches of between 50 to 500 form letters per PDF or as one form letter with a list of supporters’ names compiled into one or more PDFs. This reduces comment processing and posting time. 
Confidential Business Information. 
Pursuant to 10 CFR 1004.11, any person submitting information that he or she believes to be confidential and exempt by law from public disclosure should submit via email two well-marked copies: one copy of the document marked ‘‘confidential’’ including all the information believed to be confidential, and one copy of the document marked ‘‘non-confidential’’ with the information believed to be confidential deleted. DOE will make its own determination about the confidential status of the information and treat it according to its determination. 
It is DOE’s policy that all comments 
may be included in the public docket, without change and as received, including any personal information provided in the comments (except information deemed to be exempt from public disclosure). 
E. Issues on Which DOE Seeks Comment 
Although DOE welcomes comments 
on any aspect of this proposal, DOE is 
particularly interested in receiving comments and views of interested parties concerning the following issues: 
(1) DOE seeks comment on the 
proposal to not make any changes to room AC product classes. See section IV.A.1 of this document. 
(2) DOE seeks comment on whether 
evaporator air recirculation should be included in the engineering analysis. See section IV.A.2.a of this document. 
(3) DOE seeks comment on the 
updated single-speed compressor maximum efficiency estimates. See section IV.A.2.b of this document. 
(4) DOE seeks comment on the 
approach to alternative refrigerants in this engineering analysis. See section IV.A.2.c of this document. 
(5) DOE seeks comment on the 
technologies screened out in the NOPR screening analysis. See section IV.B.1 of this document. 
(6) DOE requests comment on the new 
efficiency level (EL 4) in the engineering analysis. See section IV.C.1.b of this document. 
(7) DOE seeks comment on the 
approach to design EL 3 as the level reached by the most efficient single- speed room ACs. See section IV.C.1.b of this document. 
(8) DOE requests comment on the 
incremental MPCs from the NOPR engineering analysis. See section IV.C.3 of this document. 
(9) DOE welcomes feedback on its 
approach to estimating fan-only use 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00080 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420687 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
operating hours and any additional data 
that can be provided to estimate the amount of time spent in fan-only mode. See section IV.E of this document. 
(10) DOE requests feedback on its 
approach to calculating the energy-use of variable-speed compressors and would welcome field metered data to further investigate the varying amounts of energy use due to single-speed and variable-speed units. See section IV.E of this document. 
(11) DOE requests comments on its 
assumption and methodology for determining equipment price trends. See section IV.F.1 of this document. 
(12) DOE requests feedback on its 
approach to projecting the efficiency distribution in 2026. See section IV.F.8 of this document. 
(13) DOE welcomes shipments data 
that include markets in addition to replacement and first-time user markets. See section IV.G of this document. 
(14) DOE requests comment on its 
general methodology for estimating shipments. See section IV.G of this document. 
(15) DOE requests comment its 
approach to projecting market share for variable-speed technologies over the course of the analysis period. See section IV.H.1 of this document. 
(16) DOE requests comment on its 
approach to monetizing the impact of the rebound effect in standards cases. See section IV.H.3 of this document. 
(17) DOE requests comment on the 
magnitude of costs associated with transitioning room AC models to low- GWP refrigerants, such as R–32, along with the associated UL costs that would be incurred between the publication of this NOPR and the proposed compliance date of amended standards. Quantification and categorization of associated costs, such as engineering efforts, test lab time, UL certification costs, and capital investments, would enable DOE to refine its analysis. See section V.B.2.d of this document. 
(18) DOE requests information 
regarding the impact of cumulative regulatory burden on manufacturers of room ACs associated with multiple DOE standards or product-specific regulatory actions of other Federal agencies. See section V.B.2.d of this document. 
(19) DOE requests comment on the 
percentage of room ACs manufactured outside of China and the countries of origin, as well as information on the country-specific fully-burdened labor rates and key raw material prices. 
(20) DOE requests comment on the 
impact of tariffs on pricing at each step in the distribution chain, as well as the percentage change in retail price paid by the consumer as a result of Section 301 tariffs. See section V.B.2.e of this 
document. 
(21) DOE requests comment on the 
certification conclusion. 
Additionally, DOE welcomes 
comments on other issues relevant to the conduct of this rulemaking that may not specifically be identified in this document. 
IX. Approval of the Office of the 
Secretary 
The Secretary of Energy has approved 
publication of this notice of proposed 
rulemaking. 
List of Subjects 10 CFR Part 429 
Administrative practice and 
procedure, Confidential business 
information, Energy conservation, Household appliances, Reporting and recordkeeping requirements. 
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 March 28, 2022, 
by Kelly J. Speakes-Backman, Principal Deputy Assistant Secretary for Energy Efficiency and Renewable Energy, pursuant to delegated authority from the Secretary of Energy. That document with the original signature and date is maintained by DOE. For administrative purposes only, and in compliance with requirements of the Office of the Federal Register, the undersigned DOE Federal Register Liaison Officer has been authorized to sign and submit the document in electronic format for publication, as an official document of the Department of Energy. This administrative process in no way alters the legal effect of this document upon publication in the Federal Register. 
Signed in Washington, DC, on March 31, 
2022. 
Treena V. Garrett, Federal Register Liaison Officer, U.S. 
Department of Energy. 
For the reasons set forth in the 
preamble, DOE proposes to amend parts 
429 and 430 of chapter II, subchapter D, of title 10 of the Code of Federal Regulations, as set forth below: PART 429—CERTIFICATION, 
COMPLIANCE, AND ENFORCEMENT FOR CONSUMER PRODUCTS AND COMMERCIAL AND INDUSTRIAL EQUIPMENT 
■1. The authority citation for part 429 
continues to read as follows: 
Authority: 42 U.S.C. 6291–6317; 28 U.S.C. 
2461 note. 
■2. Section 429.134 is amended by 
adding paragraph(s) to read as follows: 
§ 429.134 Product-specific enforcement 
provisions. 
* * * * * 
(s) Room air conditioners. Verification 
of cooling capacity. DOE will measure 
the cooling capacity of each unit DOE tests pursuant to the test requirements of 10 CFR part 430. DOE will calculate the mean of the test results, rounded to the nearest hundred, and compare it to the value of cooling capacity certified by the manufacturer for the basic model. The certified cooling capacity will be considered valid only if the basic model is properly certified pursuant to this part, and the rounded mean from testing pursuant to this section is within five percent of the cooling capacity reported in the manufacturer’s most recent valid certification report at the time of DOE’s assessment test. 
(1) If the certified cooling capacity is 
valid, DOE will use the certified cooling capacity as the basis for identifying the correct product class for the basic model and the minimum combined energy efficiency ratio allowed for the basic model. 
(2) If the certified cooling capacity is 
not valid, DOE will use the mean measured cooling capacity of the units in the sample, rounded to the nearest hundred, as the basis for identifying the correct product class for the basic model and the minimum combined energy efficiency ratio allowed for the basic model. 
PART 430—ENERGY CONSERVATION 
PROGRAM FOR CONSUMER PRODUCTS 
■3. The authority citation for part 430 
continues to read as follows: 
Authority: 42 U.S.C. 6291–6309; 28 U.S.C. 
2461 note. 
■4. Section 430.32 is amended by 
revising paragraph (b) to read as follows: 
§ 430.32 Energy and water conservation 
standards and their compliance dates. 
* * * * * 
(b) Room air conditioners. 
The following standards remain in 
effect from June 1, 2014 until [date 3 
years after publication of the final rule]: 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00081 Fmt 4701 Sfmt 4702 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS420688 Federal Register / Vol. 87, No. 67 / Thursday, April 7, 2022 / Proposed Rules 
Equipment class Combined energy 
efficiency ratio 
(1) Without reverse cycle, with louvered sides, and with a certified cooling capacity * less than 6,000 Btu/h ............................ 11.0 
(2) Without reverse cycle, with louvered sides and with a certified cooling capacity of 6,000 to 7,999 Btu/h ............................ 11.0 
(3) Without reverse cycle, with louvered sides and with a certified cooling capacity of 8,000 to 13,999 Btu/h .......................... 10.9 
(4) Without reverse cycle, with louvered sides and with a certified cooling capacity of 14,000 to 19,999 Btu/h ........................ 10.7 
(5)(A) Without reverse cycle, with louvered sides and with a certified cooling capacity of 20,000 Btu/h to 27,999 Btu/h ........ .. 9.4 
(5)(B) Without reverse cycle, with louvered sides and with a certified cooling capacity of 28,000 Btu/h or more ................ ...... 9.0 
(6) Without reverse cycle, without louvered sides, and with a certified cooling capacity less than 6,000 Btu/h ......................... 10.0 
(7) Without reverse cycle, without louvered sides and with a certified cooling capacity of 6,000 to 7,999 Btu/h ....................... 10.0 
(8)(A) Without reverse cycle, without louvered sides and with a certified cooling capacity of 8,000 to 10,999 Btu/h ................ 9.6 
(8)(B) Without reverse cycle, without louvered sides and with a certified cooling capacity of 11,000 to 13,999 Btu/h ........... ... 9.5 
(9) Without reverse cycle, without louvered sides and with a certified cooling capacity of 14,000 to 19,999 Btu/h ................... 9.3 
(10) Without reverse cycle, without louvered sides and with a certified cooling capacity of 20,000 Btu/h or more ............... ..... 9.4 
(11) With reverse cycle, with louvered sides, and with a certified cooling capacity less than 20,000 Btu/h ............................... 9.8 
(12) With reverse cycle, without louvered sides, and with a certified cooling capacity less than 14,000 Btu/h .......................... 9.3 
(13) With reverse cycle, with louvered sides, and with a certified cooling capacity of 20,000 Btu/h or more .................... ......... 9.3 
(14) With reverse cycle, without louvered sides, and with a certified cooling capacity of 14,000 Btu/h or more ................. ....... 8.7 
(15) Casement-Only ............................................................................................................. ......................................................... 9.5 
(16) Casement-Slider ........................................................................................................... .......................................................... 10.4 
* The certified cooling capacity is determined by the manufacturer in accordance with 10 CFR 429.15(a)(3). 
The following standards apply to 
products manufactured starting [Date 3 
years after publication of the final rule]: 
Equipment class Combined energy 
efficiency ratio 
(1) Without reverse cycle, with louvered sides, and with a certified cooling capacity* less than 6,000 Btu/h ................... .......... 13.1 
(2) Without reverse cycle, with louvered sides and with a certified cooling capacity of 6,000 to 7,900 Btu/h ............................ 13.7 
(3) Without reverse cycle, with louvered sides and with a certified cooling capacity of 8,000 to 13,900 Btu/h .......................... 16.0 
(4) Without reverse cycle, with louvered sides and with a certified cooling capacity of 14,000 to 19,900 Btu/h ........................ 16.0 
(5)(A) Without reverse cycle, with louvered sides and with a certified cooling capacity of 20,000 Btu/h to 27,900 Btu/h ........ .. 13.8 
(5)(B) Without reverse cycle, with louvered sides and with a certified cooling capacity of 28,000 Btu/h or more ................ ...... 13.2 
(6) Without reverse cycle, without louvered sides, and with a certified cooling capacity less than 6,000 Btu/h ......................... 12.8 
(7) Without reverse cycle, without louvered sides and with a certified cooling capacity of 6,000 to 7,900 Btu/h ....................... 12.8 
(8)(A) Without reverse cycle, without louvered sides and with a certified cooling capacity of 8,000 to 10,900 Btu/h ................ 14.1 
(8)(B) Without reverse cycle, without louvered sides and with a certified cooling capacity of 11,000 to 13,900 Btu/h ........... ... 13.9 
(9) Without reverse cycle, without louvered sides and with a certified cooling capacity of 14,000 to 19,900 Btu/h ................... 13.7 
(10) Without reverse cycle, without louvered sides and with a certified cooling capacity of 20,000 Btu/h or more ............... ..... 13.8 
(11) With reverse cycle, with louvered sides, and with a certified cooling capacity less than 20,000 Btu/h ............................... 14.4 
(12) With reverse cycle, without louvered sides, and with a certified cooling capacity less than 14,000 Btu/h .......................... 13.7 
(13) With reverse cycle, with louvered sides, and with a certified cooling capacity of 20,000 Btu/h or more .................... ......... 13.7 
(14) With reverse cycle, without louvered sides, and with a certified cooling capacity of 14,000 Btu/h or more ................. ....... 12.8 
(15) Casement-Only ............................................................................................................. ......................................................... 13.9 
(16) Casement-Slider ........................................................................................................... .......................................................... 15.3 
* The certified cooling capacity is determined by the manufacturer in accordance with 10 CFR 429.15(a)(3). 
* * * * * 
[FR Doc. 2022–07141 Filed 4–6–22; 8:45 am] 
BILLING CODE 6450–01–P 
VerDate Sep<11>2014 18:02 Apr 06, 2022 Jkt 256001 PO 00000 Frm 00082 Fmt 4701 Sfmt 9990 E:\FR\FM\07APP4.SGM 07APP4khammond on DSKJM1Z7X2PROD with PROPOSALS4