REGULATORY IMPACT ANALYSIS FOR FLUORESCENT LAMP BALLASTS

TABLE OF CONTENTS

RIA.1 INTRODUCTION

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RIA.2 METHODOLOGY

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RIA-iREGULATORY IMPACT ANALYSIS FOR FLUORESCENT LAMP BALLASTS

RIA.1 INTRODUCTION

The U.S. Department of Energy (DOE) will prepare a draft regulatory impact analysis in compliance with Executive Order 12866, “Regulator y Planning and Revi ew,” which will be subject to review by the Office of Manageme nt and Budget’s Office of Information and Regulatory Affairs. 58 FR 51735 (September 30, 1993). DOE will conduct this analysis as part of the notice of proposed rulemaking (NOPR).

RIA.2 METHODOLOGY

As part of the regulatory impact analysis and as discussed in chapter 12, “Manufacturer Impact Analysis,” of the preliminary technica l support document (TSD), DOE will identify and seek to mitigate the overlapping effects on manufacturers of new or amended energy conservation standards and other regulatory ac tions affecting the same products. Through manufacturer interviews and literature searches, DOE will compile information on burdens from existing and pending regulations aff ecting fluorescent lamp ballasts.

The regulatory impact analysis also will address the potential for non-regulatory approaches to supplant or augment energy cons ervation standards to improve the efficacy of fluorescent lamp ballasts. The NOPR will include a complete quantitative analysis of alternatives to the proposed energy conservation standards. DOE will use the National Energy Savings (NES) model (discussed in chapter 10, “National Impact Analysis,” of the preliminary TSD) to calculate the NES and net present value (NPV) for the alternatives to the proposed energy conservation standards. Listed below are some of the alternative means of achieving energy efficiency improvements that DOE ha s used in prior rulemakings.

• no new regulatory action;

• consumer tax incentives;

• manufacturer tax incentives;

• performance standards;

• rebates;

• voluntary energy efficiency targets;

• early replacement ( i.e. , retrofit); and

• bulk government purchases.

The TSD in support of the NOPR will include a complete analysis of each alternative.

To compare each alternative to proposed en ergy conservation standards, DOE will need to quantify the effect of each alternative on the purchase and use of more efficacious fluorescent lamp ballasts. Once DOE estimates the impacts of alternatives to the standard, DOE will run

these standard-alternative scenarios in the NES model. Key inputs that DOE may adjust in the NES model for this analysis include:

RIA-1• energy prices and escalation factors;

• implicit market discount rates for trading off purchase price against operating expense when choosing equipment efficiency;

• customer purchase price, operating cost, and shipment scenarios;

• customer price versus effi ciency relationships; and

• equipment stock data (purchase of new equi pment or turnover rate s for inventories).

The output from the NES model for each alternative considered will be as follows:

• Energy use (EJ = 10 18 joule) is the cumulative energy use of the equipment from the

effective date of the amended standard to 2044. DOE will report elec tricity consumption as primary energy.

• National energy savings is the cumulative national energy use from the base case projection less the alte rnative projection.

• Net present value is the value of future operating cost savings from fluorescent lamp ballasts bought in the period between the effec tive date of the new standard and the close of the analysis period (2044). DOE calculat es the NPV as the difference between the present value of equipment and operating expenditures ( e.g. , energy) in the base case, and the present value of expenditures in each a lternative case. DOE will discount future operating and equipment expenditures to its anal ysis year using two discount rates: 7 and 3 percent. DOE will also calculate operating expenses (including electricity costs) over the life of the equipment.

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