32308 Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 

DEPARTMENT OF ENERGY 

10 CFR Parts 429 and 430 

[Docket Number EERE–2008–BT–STD– 

0019] 

RIN 1904–AB90 

Energy Conservation Program: Energy 

Conservation Standards for 

Residential Clothes Washers 

AGENCY: Office of Energy Efficiency and 

Renewable Energy, Department of 

Energy. 

ACTION: Direct final rule. 

SUMMARY: The Energy Policy and 

Conservation Act of 1975 (EPCA), as 

amended, prescribes energy 

conservation standards for various 

consumer products and certain 

commercial and industrial equipment, 

including residential clothes washers. 

EPCA also requires the U.S. Department 

of Energy (DOE) to determine whether 

amended standards would be 

technologically feasible and 

economically justified, and would save 

a significant amount of energy. In this 

direct final rule, DOE is adopting 

amended energy conservation standards 

for residential clothes washers. It has 

determined that the amended energy 

conservation standards for these 

products would result in significant 

conservation of energy, and are 

technologically feasible and 

economically justified. A notice of 

proposed rulemaking that proposes 

identical energy efficiency standards is 

published elsewhere in today’s Federal 

Register. If DOE receives adverse 

comment and determines that such 

comment may provide a reasonable 

basis for withdrawing the direct final 

rule, this final rule will be withdrawn 

and DOE will proceed with the 

proposed rule. 

DATES: The effective date of this rule is 

September 28, 2012 unless adverse 

comment is received by September 18, 

2012. If adverse comments are received 

that DOE determines may provide a 

reasonable basis for withdrawal of the 

final rule, a timely withdrawal of this 

rule will be published in the Federal 

Register. If no such adverse comments 

are received, compliance with the 

amended standards established for 

residential clothes washers in today’s 

final rule will be required on March 7, 

2015 and January 1, 2018, as set forth 

in Table I.1 in SUPPLEMENTARY

INFORMATION. 

ADDRESSES: The docket for this 

rulemaking is available for review at 

www.regulations.gov, including Federal 

Register notices, framework documents, 

public meeting attendee lists and 

transcripts, comments, and other 

supporting materials. All documents in 

the docket are listed in the 

regulations.gov index. Not all 

documents listed in the index may be 

publicly available, however, such as 

information that is exempt from public 

disclosure. 

A link to the docket web page can be 

found at: www.regulations.gov/ 

#!docketDetail;D=EERE-2008-BT-STD0019. The regulations.gov web page 

contains instructions on how to access 

all documents, including public 

comments, in the docket. 

FOR FURTHER INFORMATION CONTACT: 

Stephen L. Witkowski, U.S. Department 

of Energy, Office of Energy Efficiency 

and Renewable Energy, Building 

Technologies Program, EE–2J, 1000 

Independence Avenue SW., 

Washington, DC 20585–0121. 

Telephone: (202) 586–7463. Email: 

Stephen.Witkowski@ee.doe.gov. 

Ms. Elizabeth Kohl, U.S. Department 

of Energy, Office of the General Counsel, 

GC–71, 1000 Independence Avenue 

SW., Washington, DC 20585–0121. 

Telephone: (202) 586–7796. Email: 

Elizabeth.Kohl@hq.doe.govmailto:. 

SUPPLEMENTARY INFORMATION: 

Table of Contents 

I. Summary of the Direct Final Rule and Its 

Benefits 

A. Benefits and Costs to Consumers 

B. Impact on Manufacturers 

C. National Benefits 

D. Conclusion 

II. Introduction 

A. Authority 

B. Background 

1. Current Standards 

2. History of Standards Rulemaking for 

Residential Clothes Washers 

3. Issues on Which DOE Seeks Comment 

III. General Discussion 

A. Product Classes and Scope of Coverage 

1. Elimination of Existing Product Classes 

2. Product Class Differentiation by Method 

of Access 

3. Compact Product Class 

4. Product Class Summary 

B. Test Procedure 

1. Capacity Measurement 

2. Test Load Size 

3. Self Clean Cycles 

4. Steam Cycles 

5. Consumer Usage Patterns 

6. Standard Extractor RMC Test Procedure 

7. Performance Metric 

8. Standby Power 

9. Test Cloth 

10. Technical Edits 

11. Anti-Circumvention 

C. Technological Feasibility 

1. General 

2. Maximum Technologically Feasible 

Levels 

D. Energy Savings 

1. Determination of Savings 

2. Significance of Savings 

E. Economic Justification 

1. Specific Criteria 

2. Rebuttable Presumption 

IV. Methodology and Discussion 

A. Market and Technology Assessment 

1. General 

2. Products Included in This Rulemaking 

3. Product Classes 

4. Non-Regulatory Programs 

5. Technology Options 

B. Screening Analysis 

1. Technologies Requiring Clarification or 

Reclassification 

2. Technological Feasibility 

3. Practicability to Manufacture, Install, 

and Service/Adverse Impacts on Product 

Utility or Availability 

4. Adverse Impacts on Health or Safety 

5. Additional Screening Criteria 

C. Engineering Analysis 

1. Other Technologies not Analyzed 

2. Baseline Efficiency Levels 

3. Higher Efficiency Levels 

4. Maximum Technologically Feasible 

Efficiency Levels 

5. Proprietary Designs 

6. Reverse Engineering 

D. Markups Analysis 

E. Energy and Water Use Analysis 

1. Clothes Washer Usage 

2. Rebound Effect 

F. Life-Cycle Cost and Payback Period 

Analysis 

1. Product Cost 

2. Installation Cost 

3. Annual Energy Consumption 

4. Energy Prices 

5. Energy Price Projections 

6. Water and Wastewater Prices 

7. Maintenance and Repair Costs 

8. Product Lifetime 

9. Discount Rates 

10. Compliance Date of Amended 

Standards 

11. Base-Case Efficiency Distribution 

12. Inputs to Payback Period Analysis 

13. Rebuttable-Presumption Payback 

Period 

G. National Impact Analysis—National 

Energy Savings and Net Present Value 

Analysis 

1. Shipments 

2. Forecasted Efficiency in the Base Case 

and Standards Cases 

3. Total Installed Cost per Unit 

4. National Energy and Water Savings 

5. Net Present Value of Consumer Benefit 

6. Benefits From Effects of Standards on 

Energy Prices 

H. Consumer Subgroup Analysis 

I. Manufacturer Impact Analysis 

1. Overview 

2. GRIM Analysis 

3. Discussion of Comments 

4. Manufacturer Interviews 

J. Employment Impact Analysis 

K. Utility Impact Analysis 

L. Emissions Analysis 

M. Monetizing Carbon Dioxide and Other 

Emissions Impacts 

1. Social Cost of Carbon 

2. Valuation of Other Emissions 

Reductions 

V. Analytical Results 

A. Trial Standard Levels 


srobinson on DSK4SPTVN1PROD with RULES3
Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 32309 

1For editorial reasons, upon codification in the 

U.S. Code, Part B was redesignated Part A. 

2 DOE Docket No. EERE–2008–BT–STD–0019, 

Comment 35. 

B. Economic Justification and Energy 

Savings 

1. Economic Impacts on Individual 

Consumers 

2. Economic Impacts on Manufacturers 

3. National Impact Analysis 

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 

C. Conclusion 

1. Benefits and Burdens of TSLs 

Considered for Residential Clothes 

Washers 

2. Summary of Benefits and Costs 

(Annualized) of the Standards 

VI. Procedural Issues and Regulatory Review 

A. Review Under Executive Order 12866 

and Executive Order 13563 

B. Review Under the Regulatory Flexibility 

Act 

1. Description of Why DOE Is Considering 

the Standards in Today’s Direct Final 

Rule 

2. Statement of the Objectives of, and Legal 

Basis for, the Standards 

3. Description and Estimated Number of 

Small Entities Regulated 

4. Description and Estimate of Compliance 

Requirements 

5. Duplication, Overlap, and Conflict With 

Other Rules 

6. Significant Alternatives to the Rule 

C. Review Under the Paperwork Reduction 

Act 

D. Review Under the National 

Environmental Policy Act of 1969 

E. Review Under Executive Order 13132 

F. Review Under Executive Order 12988 

G. Review Under the Unfunded Mandates 

Reform Act of 1995 

H. Review Under the Treasury and General 

Government Appropriations Act, 1999 

I. Review Under Executive Order 12630 

J. Review Under the Treasury and General 

Government Appropriations Act, 2001 

K. Review Under Executive Order 13211 

L. Review Under the Information Quality 

Bulletin for Peer Review 

M. Congressional Notification 

VII. Approval of the Office of the Secretary 

I. Summary of the Direct Final Rule 

and Its Benefits 

Title III, Part B1 of the Energy Policy 

and Conservation Act of 1975 (EPCA or 

the Act), Public Law 94–163 (42 U.S.C. 

6291–6309, as codified), established the 

Energy Conservation Program for 

Consumer Products Other Than 

Automobiles. Pursuant to EPCA, any 

new or amended energy conservation 

standard that DOE prescribes for certain 

products, such as residential clothes 

washers, shall be designed to achieve 

the maximum improvement in energy 

efficiency that is technologically 

feasible and economically justified. (42 

U.S.C. 6295(o)(2)(A)) Furthermore, the 

new or amended standard must result in 

a significant conservation of energy. (42 

U.S.C. 6295(o)(3)(B)) In accordance with 

these and other statutory provisions 

discussed in this notice, DOE is 

adopting amended energy conservation 

standards for residential clothes 

washers. The amended standards, 

which are a minimum allowable 

integrated modified energy factor 

(IMEF) and maximum allowable 

integrated water factor (IWF), are shown 

in Table I–1. One set of amended 

standards applies to all products listed 

in Table I–1 manufactured in, or 

imported into, the United States on or 

after March 7, 2015. A second set of 

amended standards applies to the two 

top-loading product classes for products 

manufactured in, or imported into, the 

United States on or after January 1, 

2018. 

TABLE I–1—AMENDED ENERGY CONSERVATION STANDARDS FOR RESIDENTIAL CLOTHES WASHERS (COMPLIANCE

STARTING 2015 AND 2018) 

Product class 

Compliance date: 

March 7, 2015 

Compliance date: 

January 1, 2018 

Minimum 

IMEF * 

Maximum 

IWF † 

Minimum 

IMEF * 

Maximum 

IWF † 

1. Top-loading, Compact (less than 1.6 ft3 capacity) ...................................................................... 0.86 14.4 1.15 12.0 

2. Top-loading, Standard ................................................................................................................. 1.29 8.4 1.57 6.5 

3. Front-loading, Compact (less than 1.6 ft3 capacity) .................................................................... 1.13 8.3 N/A 

4. Front-loading, Standard ............................................................................................................... 1.84 4.7 N/A 

* IMEF (integrated modified energy factor) is calculated as the clothes container capacity in cubic feet divided by the sum, expressed in kilowatt-hours (kWh), of: (1) The total weighted per-cycle hot water energy consumption; (2) the total weighted per-cycle machine electrical energy 

consumption; (3) the per-cycle energy consumption for removing moisture from a test load; and (4) the per-cycle standby and off mode energy 

consumption. 

† IWF (integrated water consumption factor) is calculated as the sum, expressed in gallons per cycle, of the total weighted per-cycle water consumption for all wash cycles divided by the clothes container capacity in cubic feet. 

These standard levels are equivalent 

to those proposed in a comment 

submitted by groups representing 

manufacturers; energy and 

environmental advocates; and consumer 

groups. This collective set of comments, 

titled ‘‘Agreement on Minimum Federal 

Efficiency Standards, Smart Appliances, 

Federal Incentives and Related Matters 

for Specified Appliances’’ (the ‘‘Joint 

Petition’’ 2), recommends specific 

energy conservation standards for 

residential clothes washers that, in the 

commenters’ view, would satisfy the 

EPCA requirements in 42 U.S.C. 

6295(o). The amended standards that 

DOE is adopting in today’s direct final 

rule are the clothes washer efficiencies 

recommended in the Joint Petition 

(shown in Table I–2), evaluated 

according to DOE’s clothes washer test 

procedure at appendix J2 and expressed 

in integrated energy and water use 

metrics. 


srobinson on DSK4SPTVN1PROD with RULES3
32310 Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 

3 DOE calculates emissions reductions relative to 

the most recent version of the Annual Energy 

Outlook (AEO) Reference case forecast. As noted in 

section 15.2 of the direct final rule TSD chapter 15, 

this forecast accounts for emissions reductions from 

in-place regulations, including the Clean Air 

Interstate Rule (CAIR, 70 FR 25162 (May 12, 2005)), 

but not the Clean Air Mercury Rule (CAMR, 70 FR 

28606 (May 18, 2005)). Subsequent regulations, 

including the recently finalized transport rule, the 

Cross-State Air Pollution rule issued on July 6, 

2011, do not appear in the forecast at this time. 

4Results for NOX and Hg are presented in short 

tons. One short ton equals 2,000 lbs. 

5 DOE is aware of multiple agency efforts to 

determine the appropriate range of values used in 

evaluating the potential economic benefits of 

reduced Hg emissions. DOE has decided to await 

further guidance regarding consistent valuation and 

reporting of Hg emissions before it once again 

monetizes Hg emissions reductions in its 

rulemakings. 

TABLE I–2—JOINT PETITION RECOMMENDED ENERGY CONSERVATION STANDARDS FOR RESIDENTIAL CLOTHES WASHERS

Product class 

Compliance date: 

2015 

Compliance date: 

2018 

Minimum 

MEF * 

Maximum 

WF † 

Minimum 

MEF * 

Maximum 

WF † 

1. Top-loading, Compact (less than 1.6 ft3 capacity) ...................................................................... 1.26 14.0 1.81 11.6 

2. Top-loading, Standard ................................................................................................................. 1.72 8.0 2.0 6.0 

3. Front-loading, Compact (less than 1.6 ft3 capacity) .................................................................... 1.72 8.0 N/A 

4. Front-loading, Standard ............................................................................................................... 2.20 4.5 N/A 

* MEF (modified energy factor) is calculated as the clothes container capacity in cubic feet divided by the sum, expressed in kilowatt-hours 

(kWh), of: (1) The total weighted per-cycle hot water energy consumption; (2) the total weighted per-cycle machine electrical energy consumption; and (3) the per-cycle energy consumption for removing moisture from a test load. 

† WF (water consumption factor) is calculated as the sum, expressed in gallons per cycle, of the total weighted per-cycle water consumption 

for the cold wash/cold rinse cycle divided by the clothes container capacity in cubic feet. 

As discussed further in III.A.1, DOE 

did not maintain the top-loading semiautomatic and suds-saving product 

classes, and therefore did not consider 

these product classes in its analysis. 

DOE also added a front-loading, 

compact product class. 

A. Benefits and Costs to Consumers 

Table I–3 presents DOE’s evaluation 

of the economic impacts of today’s 

standards on consumers of residential 

clothes washers, as measured by the 

average life-cycle cost (LCC) savings and 

the median payback period. The 

impacts on consumers, as measured by 

the average LCC savings, are positive for 

all product classes. 

TABLE I–3—IMPACTS OF TODAY’S

STANDARDS ON CONSUMERS OF

RESIDENTIAL CLOTHES WASHERS

Product class 

Average 

LCC savings (2010$) 

Median payback period 

(years) 

Top-Loading, 

Standard * ...... 268/366 0.4/0.9 

Front-Loading, 

Standard ........ 37 1.3 

Top-Loading, 

Compact * ...... 159/312 0.5/2.1 

Front-Loading, 

Compact ........ 54 0.8 

* The first value refers to the standards in 

2015, and the second value refers to the 

standards in 2018. 

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 

(2015 to 2044). Using a real discount 

rate of 8.5 percent, DOE estimates that 

the industry net present value (INPV) 

for manufacturers of clothes washers is 

$2,586 million in 2010$. Under today’s 

standards, DOE expects that 

manufacturers may lose up to 33 

percent of their INPV, which is 

approximately $859 million. 

Additionally, based on DOE’s 

interviews with the manufacturers of 

clothes washers, DOE does not expect 

any plant closings or significant loss of 

employment. 

C. National Benefits 

DOE’s analyses indicate that today’s 

standards would save a significant 

amount of energy and water over 30 

years (2015–2044)—an estimated 2.04 

quads of energy and 3.03 trillion gallons 

of water. In addition, DOE expects the 

energy savings from today’s standards to 

eliminate the need for approximately 

1.30 gigawatts (GW) of generating 

capacity by 2044. 

The cumulative national net present 

value (NPV) of total consumer costs and 

savings of today’s standards in 2010$ 

ranges from $13.01 billion (at a 7- 

percent discount rate) to $31.29 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 

products purchased in 2015–2044, 

discounted to 2011. 

In addition, today’s standards would 

have significant environmental benefits. 

The energy savings would result in 

cumulative greenhouse gas emission 

reductions of approximately 113 million 

metric tons (Mt) of carbon dioxide (CO2) 

from 2015 through 2044. During this 

period, the standards would also result 

in emissions reductions 3 of 

approximately 94.1 thousand tons of 

nitrogen oxides (NOX) and 0.269 ton of 

mercury (Hg).4 DOE estimates that the 

net present monetary value of the CO2

emissions reductions is between $530 

and $8,450 million, expressed in 2010$ 

and discounted to 2011. The value of 

the CO2 reductions is calculated using a 

range of values per metric ton of CO2

developed by a recent interagency 

process. The derivation of these Social 

Cost of Carbon (SCC) values is discussed 

in section IV.M.1. DOE also estimates 

that the net present monetary value of 

the NOX emissions reductions, 

expressed in 2010$ and discounted to 

2011, is $12 to $122 million at a 7- 

percent discount rate, and $28 to $286 

million at a 3-percent discount rate.5


srobinson on DSK4SPTVN1PROD with RULES3
Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 32311 

6 DOE used a two-step calculation process to 

convert the time-series of costs and benefits into 

annualized values. First, DOE calculated a present 

value in 2011, the year used for discounting the 

NPV of total consumer costs and savings, for the 

time-series of costs and benefits using discount 

rates of three and seven percent for all costs and 

benefits except for the value of CO2 reductions. For 

the latter, DOE used a range of discount rates, as 

shown in Table I–3. From the present value, DOE 

then calculated the fixed annual payment over a 30- 

year period that yields the same present value. The 

fixed annual payment is the annualized value. 

Although DOE calculated annualized values, this 

does not imply that the time-series of cost and 

benefits from which the annualized values were 

determined is a steady stream of payments. 

The benefits and costs of today’s 

standards, for products sold in 2015– 

2044, can also be expressed in terms of 

annualized values. The annualized 

monetary values are the sum of (1) the 

annualized national economic value, 

expressed in 2010$, of the benefits from 

operating the product (consisting 

primarily of operating cost savings from 

using less energy, minus increases in 

equipment purchase and installation 

costs, which is another way of 

representing consumer NPV, plus (2) the 

annualized monetary value of the 

benefits of emission reductions, 

including CO2 emission reductions.6

Although adding the value of 

consumer savings to the values of 

emission reductions provides a valuable 

perspective, two issues should be 

considered. First, the national operating 

cost savings are domestic U.S. consumer 

monetary savings that occur as a result 

of market transactions, while the value 

of CO2 reductions is based on a global 

value. Second, the assessments of 

operating cost savings and CO2 savings 

are performed with different methods 

that use quite different time frames for 

analysis. The national operating cost 

savings is measured for the lifetime of 

products shipped in 2015–2044. The 

SCC values, on the other hand, reflect 

the present value of some future 

climate-related impacts resulting from 

the emission of one metric ton of carbon 

dioxide in each year. These impacts 

continue well beyond 2100. 

Table I–4 shows the annualized 

values for today’s standards for 

residential clothes washers, expressed 

in 2010$. The results under the primary 

estimate are as follows. Using a 7- 

percent discount rate for benefits and 

costs other than CO2 reductions, for 

which DOE used a 3-percent discount 

rate along with the SCC series 

corresponding to a value of $22.3/ton in 

2010, the cost of the standards for 

clothes washers in today’s rule is $185 

million per year in increased equipment 

costs, while the annualized benefits are 

$1,234 million per year in reduced 

equipment operating costs, $141.7 

million in CO2 reductions, and $5.4 

million in reduced NOX emissions. In 

this case, the net benefit amounts to 

$1.20 billion per year. Using a 3-percent 

discount rate for all benefits and costs 

and the SCC series corresponding to a 

value of $22.3/ton in 2010, the cost of 

the standards for clothes washers in 

today’s rule is $212 million per year in 

increased equipment costs, while the 

benefits are $1,808 million per year in 

reduced operating costs, $141.7 million 

in CO2 reductions, and $8.0 million in 

reduced NOX emissions. In this case, the 

net benefit amounts to $1.75 billion per 

year. 

TABLE I–4—ANNUALIZED BENEFITS AND COSTS OF AMENDED STANDARDS FOR RESIDENTIAL CLOTHES WASHERS FOR

PRODUCTS SOLD IN 2015–2044 

Discount rate Primary estimate* Low net benefits 

estimate* 

High net benefits 

estimate* 

Monetized (million 2010$/year) 

Benefits 

Operating Cost Savings ................. 7% .................................. 1234 ............................... 1101 ............................... 1379. 

3% .................................. 1808 ............................... 1587 ............................... 2042. 

CO2 Reduction at $4.9/t ** ............. 5% .................................. 34.5 ................................ 31.7 ................................ 37.4. 

CO2 Reduction at $22.3/t ** ........... 3% .................................. 142 ................................. 130 ................................. 154. 

CO2 Reduction at $36.5/t ** ........... 2.5% ............................... 226 ................................. 207 ................................. 246. 

CO2 Reduction at $67.6/t ** ........... 3% .................................. 431 ................................. 396 ................................. 469. 

NOX Reduction at $2,537/t ** ......... 7% ..................................

3% ..................................

5.40 ................................

8.01 ................................

5.03 ................................

7.39 ................................

5.82. 

8.68. 

Total † ..................................... 7% plus CO2 range ........ 1274 to 1671 .................. 1137 to 1502 .................. 1423 to 1854. 

7% .................................. 1381 ............................... 1236 ............................... 1539. 

3% plus CO2 range ........ 1851 to 2248 .................. 1626 to 1991 .................. 2089 to 2520. 

3% .................................. 1958 ............................... 1725 ............................... 2205. 

Costs 

Incremental Product Costs ............ 7% .................................. 185 ................................. 258 ................................. 200. 

3% .................................. 212 ................................. 309 ................................. 230. 

Total Net Benefits 

Total † ..................................... 7% plus CO2 range ........ 1088 to 1485 .................. 880 to 1244 .................... 1223 to 1654. 

7% .................................. 1196 ............................... 978 ................................. 1339. 

3% plus CO2 range ........ 1639 to 2036 .................. 1317 to 1682 .................. 1859 to 2291. 

3% .................................. 1746 ............................... 1416 ............................... 1976. 

* The Primary, Low Benefits, and High Benefits Estimates utilize forecasts of energy prices and housing starts (which affect product shipments) 

from the AEO2010 Reference case, Low Economic Growth case, and High Economic Growth case, respectively. In addition, incremental product 

costs reflect a declining trend using the default product price trend in the Primary Estimate and the High Benefits Estimate, and constant product 

prices in the Low Benefits Estimate. Because product prices are constant in the Low Benefits Estimate, the incremental product costs are higher 

than in the other two estimates. Although the price trends in the Primary Estimate and the High Benefits Estimate are the same, the incremental 

product costs are higher in the High Benefits Estimate because this case assumes High Economic Growth and thus has more product shipments. The approach used for forecasting product prices is explained in section IV.F.1. 


srobinson on DSK4SPTVN1PROD with RULES3
32312 Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 

7For editorial reasons, upon codification in the 

U.S. Code, Part B was redesignated Part A. 

** The CO2 values represent global values (in 2010$) of the social cost of CO2 emissions in 2010 under several scenarios. The values of $4.9, 

$22.3, and $36.5 per ton are the averages of SCC distributions calculated using 5%, 3%, and 2.5% discount rates, respectively. The value of 

$67.6 per ton represents the 95th percentile of the SCC distribution calculated using a 3% discount rate. The value for NOX (in 2010$) is the average of the low and high values used in DOE’s analysis. 

† Total Benefits for both the 3% and 7% cases are derived using the SCC value calculated at a 3% discount rate, which is $22.3/ton in 2010 

(in 2010$). In the rows labeled as ‘‘7% plus CO2 range’’ and ‘‘3% plus CO2 range,’’ the operating cost and NOX benefits are calculated using the 

labeled discount rate, and those values are added to the full range of CO2 values. 

D. Conclusion 

Based on the analyses culminating in 

this final rule, DOE found the benefits 

to the nation of the standards (energy 

savings, water savings, favorable 

consumer LCC savings and payback 

period, positive NPV of consumer 

benefit, and emission reductions) 

outweigh the burdens (profit margin 

impacts that could result in a reduction 

in INPV for manufacturers). DOE has 

concluded that the standards in today’s 

final rule represent the maximum 

improvement in energy efficiency that is 

technologically feasible and 

economically justified, and would result 

in significant conservation of energy. 

DOE further notes that residential 

clothes washers achieving these 

standard levels are already 

commercially available. 

II. Introduction 

The following section briefly 

discusses the statutory authority 

underlying today’s final rule, as well as 

some of the relevant historical 

background related to the establishment 

of standards for residential clothes 

washers. 

A. Authority 

Title III, Part B of the Energy Policy 

and Conservation Act of 1975 (EPCA or 

the Act), Public Law 94–163 (42 U.S.C. 

6291–6309, as codified) established the 

Energy Conservation Program for 

Consumer Products Other Than 

Automobiles,7 a program covering most 

major household appliances 

(collectively referred to as ‘‘covered 

products’’), which includes the 

residential clothes washers that are the 

subject of this rulemaking. (42 U.S.C. 

6292(a)(7)) EPCA prescribed energy 

conservation standards for these 

products (42 U.S.C. 6295(g)(9)(a)), and 

directed DOE to conduct three cycles of 

rulemakings to determine whether to 

amend these standards. (42 U.S.C. 

6295(g)(4)(A), (g)(4)(B), and (g)(9)(B)) 

DOE also notes that under 42 U.S.C. 

6295(m), DOE must also periodically 

review its energy conservation 

standards for covered products. 

Pursuant to EPCA, DOE’s energy 

conservation program for covered 

products consists essentially of four 

parts: (1) Testing; (2) labeling; (3) the 

establishment of Federal energy 

conservation standards; and (4) 

certification and enforcement 

procedures. The Federal Trade 

Commission (FTC) is primarily 

responsible for labeling, and DOE 

implements the remainder of the 

program. 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. 6293) 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 

6295(s)) Similarly, DOE must use these 

test procedures to determine whether 

the products comply with standards 

adopted pursuant to EPCA. Id. The DOE 

test procedures for residential clothes 

washers appear at title 10 of the Code 

of Federal Regulations (CFR) part 430, 

subpart B, appendices J1 and J2. Until 

the compliance date of the amended 

energy and water conservation 

standards established in today’s direct 

final rule, absent withdrawal of the rule 

by DOE pursuant to 42 U.S.C. 

6295(p)(4), manufacturers must use the 

test procedures at appendix J1 to certify 

compliance. Subsequently, 

manufacturers must use the test 

procedures at appendix J2. Similarly, 

DOE will use the test procedure at 

appendix J1 for enforcement purposes 

until the compliance date of these 

amended energy and water conservation 

standards, and will subsequently use 

appendix J2. See section III.B for a 

detailed discussion of the test procedure 

amendments. 

DOE must follow specific statutory 

criteria for prescribing amended 

standards for covered products. As 

indicated above, any amended standard 

for a covered product must be designed 

to achieve the maximum improvement 

in energy efficiency that is 

technologically feasible and 

economically justified. (42 U.S.C. 

6295(o)(2)(A)) Furthermore, DOE may 

not adopt any standard that would not 

result in the significant conservation of 

energy. (42 U.S.C. 6295(o)(3)) In 

deciding whether an amended 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, to the 

greatest extent practicable, considering 

the following seven 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 imposition 

of the standard; 

3. The total projected amount of 

energy, or as applicable, water, savings 

likely to result directly from the 

imposition of the standard; 

4. Any lessening of the utility or the 

performance of the covered products 

likely to result from the imposition of 

the standard; 

5. The impact of any lessening of 

competition, as determined in writing 

by the Attorney General, that is likely to 

result from the imposition of the 

standard; 

6. The need for national energy and 

water conservation; and 

7. Other factors the Secretary of 

Energy (Secretary) considers relevant. 

(42 U.S.C. 6295(o)(2)(B)(i)(I)–(VII)) 

EPCA allows DOE to issue a final rule 

(hereinafter referred to as a ‘‘direct final 

rule’’) establishing an energy 

conservation standard on receipt of a 

statement submitted jointly by 

interested persons that are fairly 

representative of relevant points of view 

(including representatives of 

manufacturers of covered products, 

States, and efficiency advocates) as 

determined by the Secretary, that 

contains recommendations with respect 

to an energy conservation standard that 

are in accordance with the provisions of 

42 U.S.C. 6295(o). A notice of proposed 

rulemaking (NOPR) that proposes an 

identical energy efficiency standard 

must be published simultaneously with 

the final rule, and DOE must provide a 

public comment period of at least 110 

days. 42 U.S.C. 6295(p)(4) Not later than 


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120 days after issuance of the direct 

final rule, if one or more adverse 

comments or an alternative joint 

recommendation are received relating to 

the direct final rule, the Secretary must 

determine whether the comments or 

alternative recommendation may 

provide a reasonable basis for 

withdrawal under 42 U.S.C. 6295(o) or 

other applicable law. If the Secretary 

makes such a determination, DOE must 

withdraw the direct final rule and 

proceed with the simultaneously 

published notice of proposed 

rulemaking. DOE must publish in the 

Federal Register the reason why the 

direct final rule was withdrawn. Id. 

Furthermore, EPCA contains what is 

known as an ‘‘anti-backsliding’’ 

provision, which prevents the Secretary 

from prescribing any amended standard 

that either increases the maximum 

allowable energy use or decreases the 

minimum required energy efficiency of 

a covered product. (42 U.S.C. 

6295(o)(1)) Also, the Secretary may not 

prescribe an amended or new standard 

if interested persons have established by 

a preponderance of the evidence that 

the standard is likely to result in the 

unavailability in the United States of 

any covered product type (or class) of 

performance characteristics (including 

reliability), features, sizes, capacities, 

and volumes that are substantially the 

same as those generally available in the 

United States. (42 U.S.C. 6295(o)(4)) 

EPCA also 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. See 42 U.S.C. 

6295(o)(2)(B)(iii). 

Additionally, 42 U.S.C. 6295(q)(1) 

specifies requirements when 

promulgating a standard for a type or 

class of covered product that has two or 

more subcategories. DOE must specify a 

different standard level than that which 

applies generally to such type or class 

of products for any group of covered 

products which have the same function 

or intended use, if 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 than applies or 

will apply to the other products within 

that type or class. Id. 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 

such a feature and other factors DOE 

deems appropriate. Id. Any rule 

prescribing such a standard must 

include an explanation of the basis on 

which such higher or lower level was 

established. (42 U.S.C. 6295(q)(2)). 

Federal energy conservation 

requirements generally supersede State 

laws or regulations concerning energy 

conservation testing, labeling, and 

standards. (42 U.S.C. 6297(a)–(c)) DOE 

may, however, grant waivers of Federal 

preemption for particular State laws or 

regulations, in accordance with the 

procedures and other provisions set 

forth under 42 U.S.C. 6297(d)). 

Any final rule for new or amended 

energy conservation standards 

promulgated after July 1, 2010, must 

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 the 

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)) The current 

standard for residential clothes washers 

is based on modified energy factor 

(MEF), a metric that does not 

incorporate standby or off mode energy 

use. On March 7, 2012, DOE published 

a final rule revising the clothes washer 

test procedure (hereafter, the March 

2012 TP final rule). 77 FR 13888. Use 

of the new test procedure in 10 CFR 430 

subpart B appendix J2 will be required 

for clothes washers manufactured on or 

after the compliance date of the 2015 

standard in this direct final rule. The 

revised test procedure establishes an 

‘‘integrated modified energy factor’’ 

(IMEF), a metric that incorporates 

energy use in standby and off modes. 

The revised test procedure also includes 

updates to the active mode provisions of 

the test procedure, which affect the 

calculation of IMEF, and establishes an 

‘‘integrated water factor’’ (IWF). In this 

final rule, DOE prescribes amended 

energy conservation standards based on 

IMEF and IWF. 

DOE has also reviewed this regulation 

pursuant to Executive Order 13563, 

issued on January 18, 2011 (76 FR 3281, 

Jan. 21, 2011). Executive Order 13563 is 

supplemental to and explicitly reaffirms 

the principles, structures, and 

definitions governing regulatory review 

established in Executive Order 12866. 

To the extent permitted by law, agencies 

are required by Executive Order 13563 

to: (1) Propose or adopt a regulation 

only upon a reasoned determination 

that its benefits justify its costs 

(recognizing that some benefits and 

costs are difficult to quantify); (2) tailor 

regulations to impose the least burden 

on society, consistent with obtaining 

regulatory objectives, taking into 

account, among other things, and to the 

extent practicable, the costs of 

cumulative regulations; (3) select, in 

choosing among alternative regulatory 

approaches, those approaches that 

maximize net benefits (including 

potential economic, environmental, 

public health and safety, and other 

advantages; distributive impacts; and 

equity); (4) to the extent feasible, specify 

performance objectives, rather than 

specifying the behavior or manner of 

compliance that regulated entities must 

adopt; and (5) identify and assess 

available alternatives to direct 

regulation, including providing 

economic incentives to encourage the 

desired behavior, such as user fees or 

marketable permits, or providing 

information upon which choices can be 

made by the public. 

We emphasize as well that Executive 

Order 13563 requires agencies ‘‘to use 

the best available techniques to quantify 

anticipated present and future benefits 

and costs as accurately as possible.’’ In 

its guidance, the Office of Information 

and Regulatory Affairs has emphasized 

that such techniques may include 

‘‘identifying changing future 

compliance costs that might result from 

technological innovation or anticipated 

behavioral changes.’’ For the reasons 

stated in the preamble, DOE believes 

that today’s direct final rule is 

consistent with these principles, 

including that, to the extent permitted 

by law, agencies adopt a regulation only 

upon a reasoned determination that its 

benefits justify its costs and select, in 

choosing among alternative regulatory 

approaches, those approaches that 

maximize net benefits. 

Consistent with E.O. 13563, and the 

range of impacts analyzed in this 

rulemaking, the energy conservation 

standards adopted herein by DOE 

achieve maximum net benefits. 

B. Background 

1. Current Standards 

In a final rule published on January 

12, 2001 (2001 Final Rule), DOE 

prescribed amended energy 

conservation standards for residential 

clothes washers. 66 FR 3314. EPCA, as 

amended by EISA 2007, revised the 

energy conservation standards for 


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residential clothes washers by 

establishing a maximum water factor 

value, effective January 1, 2011. These 

standards are set forth in Table II–1. 

TABLE II–1—ENERGY CONSERVATION

STANDARDS FOR RESIDENTIAL

CLOTHES WASHERS ESTABLISHED IN

THE 2001 FINAL RULE AND EISA 

2007 

Product class 

MEF 

ft3/kWh/ 

cycle 

WF 

gal/cycle/ft3

Top-Loading, 

Compact (less 

than 1.6 ft3

capacity) ........ * 0.65 N/A 

Top-Loading, 

Standard ........ * 1.26 ** 9.5 

Front-Loading ... * 1.26 ** 9.5 

Top-Loading, 

Semi-Automatic .............. N/A N/A 

Suds-Saving ..... N/A N/A 

*Source: 2001 Final Rule (66 FR 3314). 

**Source: EISA 2007 (42 U.S.C. 

6295(g)(9)). 

The EPCA amendments in EISA 2007 

also require DOE to publish a final rule 

no later than December 31, 2011 

determining whether to amend the 

standards in effect for clothes washers 

manufactured on or after January 1, 

2015. (42 U.S.C. 6295(g)(9)) Today’s 

final rule fulfills this statutory 

requirement. 

The EISA 2007 amendments further 

require that any final rule for new or 

amended energy conservation standards 

promulgated after July 1, 2010, 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 the 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)) Today’s standards 

are based on an ‘‘integrated modified 

energy factor’’ (IMEF), which 

incorporates energy use in standby 

mode and off mode, and an ‘‘integrated 

water factor’’ (IWF), which more 

accurately represents consumer usage 

patterns compared to the current water 

factor metric. 

2. History of Standards Rulemaking for 

Residential Clothes Washers 

The National Appliance Energy 

Conservation Act of 1987 (NAECA), 

Public Law 100–12 (March 17, 1989), 

amended EPCA and required that all 

rinse cycles of clothes washers 

manufactured after January 1, 1988 

include an unheated water option, but 

stated that such clothes washers may 

have a heated water rinse option. 

NAECA further required that DOE 

conduct two cycles of rulemakings to 

determine if amended standards are 

justified. (42 U.S.C. 6295(g)(2) and (4)). 

To complete the first rulemaking 

cycle required by NAECA, DOE 

published an advance notice of 

proposed rulemaking (ANOPR) on May 

18, 1988 (53 FR 17712), a NOPR on 

August 9, 1989 (54 FR 32744), and a 

final rule on May 14, 1991 (May 1991 

final rule). 56 FR 22279. The May 1991 

final rule mandated performance-based 

energy conservation standards for toploading compact and standard clothes 

washers based on a minimum energy 

factor (EF) for products manufactured 

on or after May 14, 1994. 

To complete the second rulemaking 

cycle required by NAECA, the 

Department published an ANOPR on 

November 14, 1994 to consider 

amending the energy conservation 

standards for clothes washers, 

dishwashers, and clothes dryers. 59 FR 

56423. DOE published a supplemental 

ANOPR for clothes washers on 

November 19, 1998 (63 FR 64343), a 

NOPR on October 5, 2000 (65 FR 

59550), and a final rule on January 12, 

2001 revising the energy conservation 

standards. 66 FR 3314. 

As mentioned in the ‘‘Background’’ 

section, EISA 2007 amended EPCA to 

revise the energy conservation standards 

for residential clothes washers by 

establishing a maximum water factor, 

effective January 1, 2011. (42 U.S.C. 

6295(g)(9)) EPCA, as amended by EISA 

2007, further requires that DOE publish 

a final rule no later than December 31, 

2011, to determine whether to amend 

the standards in effect for clothes 

washers manufactured on or after 

January 1, 2015. (42 U.S.C. 

6295(g)(9)(B)(i)). 

DOE initiated the current rulemaking 

on August 28, 2009 by publishing a 

notice announcing the availability of the 

framework document, the ‘‘Energy 

Conservation Standards Rulemaking 

Framework Document for Residential 

Clothes Washers.’’ In this notice, DOE 

also announced a public meeting and 

requested public comment on the 

matters raised in the framework 

document. 74 FR 44306 (Aug. 28, 2009). 

The framework document described the 

procedural and analytical approaches 

that DOE anticipated using to evaluate 

energy conservation standards for 

clothes washers and identified various 

issues to be resolved in conducting this 

rulemaking. The framework document 

is available at http:// 

www1.eere.energy.gov/buildings/ 

appliance_standards/residential/ 

clothes_washers_framework.html. 

DOE held a public meeting on 

September 21, 2009, where it presented 

the contents of the framework 

document; described the analyses it 

planned to conduct during the 

rulemaking; sought comments from 

interested parties on these subjects; and, 

in general, sought to inform interested 

parties about, and facilitate their 

involvement in, the rulemaking. 

Interested parties discussed the 

following major issues at the public 

meeting: Test procedure revisions; 

product classes; technology options; 

approaches to the engineering, life-cycle 

cost, payback period and national 

impact analyses; efficiency levels 

analyzed in the engineering analysis; 

and the approach for estimating typical 

energy and water consumption. At the 

meeting and during the period for 

commenting on the framework 

document, DOE received many 

comments that helped it identify and 

resolve issues involved in this 

rulemaking. 

In response to the framework 

document, DOE received the Joint 

Petition, a comment submitted by 

groups representing manufacturers (the 

Association of Home Appliance 

Manufacturers (AHAM), Whirlpool 

Corporation (Whirlpool), General 

Electric Company (GE), Electrolux, LG 

Electronics, Inc. (LG), BSH Home 

Appliances (BSH), Alliance Laundry 

Systems (ALS), Viking Range, Sub-Zero 

Wolf, Friedrich A/C, U-Line, Samsung, 

Sharp Electronics, Miele, Heat 

Controller, AGA Marvel, Brown Stove, 

Haier, Fagor America, Airwell Group, 

Arcelik, Fisher & Paykel, Scotsman Ice, 

Indesit, Kuppersbusch, Kelon, and 

DeLonghi); energy and environmental 

advocates (American Council for an 

Energy Efficient Economy (ACEEE), 

Appliance Standards Awareness Project 

(ASAP), Natural Resources Defense 

Council (NRDC), Alliance to Save 

Energy (ASE), Alliance for Water 

Efficiency (AWE), Northwest Power and 

Conservation Council (NPCC), and 

Northeast Energy Efficiency 

Partnerships (NEEP)); and consumer 

groups (Consumer Federation of 

America (CFA) and the National 

Consumer Law Center (NCLC)) 

(collectively, the ‘‘Joint Petitioners’’). 

The Joint Petitioners recommended 

specific energy conservation standards 

for residential clothes washers that, in 

their view, would satisfy the EPCA 

requirements in 42 U.S.C. 6295(o). 

Earthjustice submitted a comment 


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8A notation in the form ‘‘Earthjustice, No. 38 at 

p. 1’’ identifies a written comment that DOE has 

received and has included in the docket of the 

standards rulemaking for residential clothes 

washers (Docket No. EERE–2008–BT–STD–0019). 

This particular notation refers to a comment (1) 

submitted by Earthjustice, (2) in document number 

38 in the docket of that rulemaking, and (3) 

appearing on page 1 of document number 38. 

affirming its support for the joint 

petition. (Earthjustice, No. 38 at p. 1). 8

After careful consideration of the Joint 

Petition containing a consensus 

recommendation for amended energy 

conservation standards for residential 

clothes washers, the Secretary has 

determined that this ‘‘Consensus 

Agreement’’ has been submitted by 

interested persons who are fairly 

representative of relevant points of view 

on this matter. Congress provided some 

guidance within the statute itself by 

specifying that representatives of 

manufacturers of covered products, 

States, and efficiency advocates are 

relevant parties to any consensus 

recommendation. (42 U.S.C. 

6295(p)(4)(A)) As delineated above, the 

Consensus Agreement was signed and 

submitted by a broad cross-section of 

the manufacturers who produce the 

subject products, their trade 

associations, and environmental, energy 

efficiency, and consumer advocacy 

organizations. Although States were not 

signatories to the Consensus Agreement, 

they did not express any opposition to 

it. Moreover, DOE does not read the 

statute as requiring absolute agreement 

among all interested parties before the 

Department may proceed with issuance 

of a direct final rule. By explicit 

language of the statute, the Secretary has 

discretion to determine when a joint 

recommendation for an energy or water 

conservation standard has met the 

requirement for representativeness (i.e., 

‘‘as determined by the Secretary’’). 

Accordingly, DOE will consider each 

consensus recommendation on a caseby-case basis to determine whether the 

submission has been made by interested 

persons fairly representative of relevant 

points of view. 

Pursuant to 42 U.S.C. 6295(p)(4), the 

Secretary must also determine whether 

a jointly-submitted recommendation for 

an energy or water conservation 

standard is in accordance with 42 U.S.C. 

6295(o) or 42 U.S.C. 6313(a)(6)(B), as 

applicable. This determination is 

exactly the type of analysis which DOE 

conducts whenever it considers 

potential energy conservation standards 

pursuant to EPCA. DOE applies the 

same principles to any consensus 

recommendations it may receive to 

satisfy its statutory obligation to ensure 

that any energy conservation standard 

that it adopts achieves the maximum 

improvement in energy efficiency that is 

technologically feasible and 

economically justified and will result in 

significant conservation of energy. Upon 

review, the Secretary determined that 

the Consensus Agreement submitted in 

the instant rulemaking comports with 

the standard-setting criteria set forth 

under 42 U.S.C. 6295(o). Accordingly, 

the consensus agreement levels were 

included as trial standard level (TSL) 3 

in today’s rule for residential clothes 

washers. The details of the efficiency 

levels comprising TSL 3 and the other 

TSLs considered for the direct final rule 

are discussed in section VI.A. 

In sum, because the relevant criteria 

under 42 U.S.C. 6295(p)(4) have been 

satisfied, the Secretary has determined 

that it is appropriate to adopt amended 

energy conservation standards for 

residential clothes washers through this 

direct final rule. 

As required by the same statutory 

provision, DOE is also simultaneously 

publishing a NOPR which proposes the 

identical standard levels contained in 

this direct final rule and is providing for 

a 110-day public comment period. DOE 

will consider whether any comment 

received during this comment period is 

sufficiently ‘‘adverse’’ as to provide a 

reasonable basis for withdrawal of the 

direct final rule and continuation of this 

rulemaking under the NOPR. Typical of 

other rulemakings, it is the substance, 

rather than the quantity, of comments 

that will ultimately determine whether 

a direct final rule will be withdrawn. To 

this end, the substance of any adverse 

comment(s) received will be weighed 

against the anticipated benefits of the 

Consensus Agreement and the 

likelihood that further consideration of 

the comment(s) would change the 

results of the rulemaking. DOE notes 

that to the extent an adverse comment 

had been previously raised and 

addressed in the rulemaking 

proceeding, such a submission will not 

typically provide a basis for withdrawal 

of a direct final rule. 

3. Issues on Which DOE Seeks Comment 

As stated previously, in promulgating 

today’s direct final rule pursuant to 42 

U.S.C. 6295(p)(4), DOE carefully 

considered the Joint Petition submitted 

to DOE, which contained a consensus 

recommendation for amended energy 

conservation standards for residential 

clothes washers. For the reasons stated 

in this direct final rule, the Secretary 

determined that the ‘‘Consensus 

Agreement’’ was submitted by 

interested persons who are fairly 

representative of relevant points of view 

on this matter. The Secretary also 

determined, for the reasons set forth in 

this direct final rule, that the standards 

contained in the Consensus Agreement 

comport with the standard-setting 

criteria set forth under 42 U.S.C. 

6295(o). Therefore, the Secretary 

promulgates this direct final rule 

establishing the amended energy 

conservation standards for residential 

clothes washers. 

As required by the same statutory 

provision, DOE is also simultaneously 

publishing a NOPR and providing for a 

110-day public comment period. Should 

DOE determine to proceed with the 

NOPR, or to gather additional data for 

future energy conservation standards 

activities for residential clothes 

washers, DOE will consider any 

comments and data received on the 

direct final standards. Although 

comments are welcome on all aspects of 

this rulemaking, DOE is particularly 

interested in comments on the 

following: 

(1) Impacts of the standards that may 

lessen or improve the utility or 

performance of the covered products. 

These impacts may include increased 

cycle times to wash clothes, ability to 

achieve good wash performance (e.g., 

cleaning and rinsing), increased 

longevity of clothing, improved 

ergonomics of washer use, increase in 

noise, and other potential impacts. 

(2) The 2015 and 2018 compliance 

dates for the proposed standards and 

whether these compliance dates 

adequately consider the typical clothes 

washer model design cycle for 

manufacturers. 

(3) Whether repair costs for 

residential clothes washers would 

increase at the efficiency levels 

indicated in today’s rule due to any 

changes in the design and materials and 

components used in order to comply 

with the new efficiency standards. 

(4) Where there would be any 

anticipated changes in the consumption 

of complementary goods (e.g., laundry 

detergent, stain removers, fabric 

softeners) that may result from the 

proposed standards. 

(5) Whether DOE should incorporate 

the cost of risers or storage drawers (also 

referred to as pedestals) into the 

baseline installation costs for frontloading machines. 

Changes in the Utility of the Products 

DOE has prepared a technical support 

document (TSD) that analyzed the effect 

of this rule on, among other things, life 

cycle costs, payback periods and other 

consumer-related impacts. However, 

there are other facets of consumer 

welfare that are not explicitly captured 

in this analysis, including washing 


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performance, increased longevity of 

clothing, and noise. While information 

gathered in the course of this 

rulemaking did not demonstrate a 

linkage between these topics and 

efficiency standards, DOE is seeking 

comment and information on how 

consumers value changes in these 

attributes and if those values should be 

incorporated into DOE analysis. 

Also, although it is outside the scope 

of this rule, DOE may consider seeking 

information on whether to account for 

wash performance and fabric care in test 

procedures for clothes washers. 

2015 and 2018 Compliance Dates 

Recognizing that this direct final rule, 

including the compliance dates, is based 

on a consensus agreement including 

virtually all manufacturers of residential 

clothes washers, DOE is seeking 

comment on redesign timelines 

anticipated by the manufacturers and 

how the 2015 and 2018 compliance 

dates may affect those timelines. DOE’s 

manufacturer impact analysis is based 

on information provided by the 

manufacturer and supports the positions 

that manufacturers will need to make 

only minor redesign to comply with the 

2015 standards, though the 2018 

standards could require more 

substantial redesigns. Accepting that 

manufacturers fully considered their 

cost implications prior to entering 

voluntarily the consensus agreement, 

DOE assumes that manufacturers would 

not have agreed to compliance dates 

they could not meet or that imposed 

prohibitive costs. However, depending 

on how the redesign timeline and the 

compliance dates coincide, the cost 

estimates may be affected, for example, 

due to sunk cost, as well as the 

anticipated market shares of frontloading versus top-loading clothes 

washers. 

The TSD, which is available at the 

rulemaking Web site at 

www1.eere.energy.gov/buildings/ 

appliance_standards/residential/ 

clothes_washers.html, provides an 

overview of the activities DOE 

undertook in developing standards for 

clothes washers. It presents and 

describes in detail each analysis DOE 

performed, including descriptions of 

inputs, sources, methodologies, and 

results. These analyses are as follows: 

• A market and technology 

assessment addresses the scope of this 

rulemaking, identifies the clothes 

washer product classes, characterizes 

the markets for the products, and 

reviews techniques and approaches for 

improving their efficiency. 

• A screening analysis reviews 

technology options to improve the 

efficiency of residential clothes washers 

and weighs those options against DOE’s 

four prescribed screening criteria. 

• An engineering analysis develops 

the relationship between increased 

manufacturer price and increased 

efficiency. 

• A markups analysis establishes 

markups for converting manufacturer 

prices to customer product costs. 

• An energy use analysis generates 

energy-use estimates for residential 

clothes washers as a function of 

efficiency levels. 

• A life-cycle cost analysis calculates 

the effects of standards on individual 

customers and compares the life-cycle 

costs (LCC) and payback period (PBP) of 

products with and without higher 

efficiency standards. 

• A shipments analysis forecasts 

shipments with and without higher 

efficiency standards. 

• A national impact analysis 

forecasts the national energy savings 

(NES), and the national net present 

value of total consumer costs and 

savings, expected to result from specific, 

potential energy conservation standards 

for residential clothes washers. 

• A consumer subgroup analysis 

discusses the effects of standards on 

different subgroups of consumers. 

• A manufacturer impact analysis 

discusses the effects of standards on the 

finances and profitability of product 

manufacturers. 

• An employment impact analysis 

discusses the indirect effects of 

standards on national employment. 

• A utility impact analysis discusses 

the effects of standards on electric and 

gas utilities. 

• An emissions analysis discusses the 

effects of standards on three 

pollutants—sulfur dioxide (SO2), 

nitrogen oxides (NOX), and mercury—as 

well as carbon emissions. 

• A regulatory impact analysis 

discusses the impact of non-regulatory 

alternatives to efficiency standards. 

Finally, the comments received since 

publication of the framework document, 

including the Joint Petition, have 

contributed to DOE’s proposed 

resolution of the issues in this 

rulemaking. This direct final rule 

addresses these comments and responds 

to the issues they raised. 

III. General Discussion 

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 affect efficiency. Different 

energy conservation standards may 

apply to different product classes. (42 

U.S.C. 6295(q)) 

DOE received several comments from 

interested parties regarding the product 

classes and their organization. 

Specifically, DOE received comments 

regarding the criteria used as a basis for 

creating product classes; the potential 

elimination of top-loading 

semiautomatic and suds-saving product 

classes; and whether combination 

washer/dryers are covered products. 

DOE’s responses to these comments are 

discussed in the following sections. 

Existing energy conservation 

standards divide residential clothes 

washers into five product classes based 

on location of access, capacity, and 

other features such as suds saving. 

• Top-loading, compact (less than 1.6 

cubic feet capacity); 

• Top-loading, standard (1.6 cubic 

feet or greater capacity); 

• Top-loading, semiautomatic; 

• Front-loading; and 

• Suds-saving. 

AWE stated that DOE’s practice of 

considering separate product classes 

should be analyzed, and that by making 

exceptions for old technologies by 

creating their own product class, DOE 

hinders innovation and the 

establishment of more progressive 

standards. AWE further stated that some 

manufacturers have already 

demonstrated that efficiency levels can 

be obtained without sacrificing 

performance. According to AWE, DOE 

should move to performance-based 

standards and to eliminate technologybased standards unless it can be 

demonstrated that the full life-cycle 

consumer economic impacts would 

favor continuation of product classes. 

(AWE, No. 12 at p. 2) Pursuant to 42 

U.S.C. 6295(q), DOE must set different 

energy conservation standards for 

groups of covered products if such 

products consume a different kind of 

energy than other products within the 

same type or class, or if such products 

have a capacity or other performancerelated feature that justifies a different 

standard. In determining whether a 

different standard is justified, EPCA 

requires DOE to consider utility to the 

consumer and any other appropriate 

factors. DOE is required to establish 

standards that achieve the maximum 

improvement in energy and water 

efficiency that is both technologically 

feasible and economically justified. (42 

U.S.C. 6295(o)(2)(A)) As explained 

below, DOE has adhered to these 

statutory requirements in establishing 

the product classes in today’s 

rulemaking. 


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9A notation in the form ‘‘AHAM, Public Meeting 

Transcript, No. 7 at pp. 42, 72’’ identifies an oral 

comment that DOE received during the September 

21, 2009, framework public meeting and which was 

recorded in the public meeting transcript in the 

docket for the standards rulemaking for residential 

clothes washers (Docket No. EERE–2008–BT–STD– 

0019), maintained in the Resource Room of the 

Building Technologies Program. This particular 

notation refers to a comment (1) made by the 

Association of Home Appliance Manufacturers 

(AHAM) during the public meeting, (2) recorded in 

document number 7, which is the public meeting 

transcript that is filed in the docket of this 

rulemaking, and (3) which appears on pages 42 and 

72 of document number 7. 

10 In its written comment, document number 19 

in the docket of this rulemaking, GE states that it 

adopts by reference the comments submitted to 

DOE by AHAM. Thus, GE is cited alongside AHAM 

when discussing AHAM’s written comments. 

11The Alliance to Save Energy submitted a 

written comment, designated as document number 

23 in the docket of this rulemaking, stating that it 

endorses the joint comments submitted by ASAP, 

NRDC, and NCLC, and requested that it be listed as 

a co-endorser in citation of these joint comments. 

1. Elimination of Existing Product 

Classes 

DOE sought comment in the 

framework document as to whether it 

should retain the top-loading semiautomatic and suds-saving product 

classes because it is unaware of any 

such residential clothes washers on the 

market. DOE also noted that its test 

procedures at appendices J1 and J2 do 

not measure the possible energy savings 

associated with suds-saving because 

DOE is not aware of methodology to 

measure such savings over sequential 

operating cycles as necessary to capture 

the benefit of suds-saving. AHAM, ALS, 

GE, Samsung, and Whirlpool supported 

the elimination of top-loading semiautomatic and suds-saving product 

classes. (AHAM, Public Meeting 

Transcript, No. 7 at pp. 42, 72; 9 ALS, 

Public Meeting Transcript, No. 7 at p. 

39; GE, Public Meeting Transcript, No. 

7 at p. 41; GE, No. 20 at p. 1; 10

Samsung, No. 25 at p. 3; Whirlpool, 

Public Meeting Transcript, No. 7 at p. 

41) AHAM, ALS, GE, and Whirlpool 

stated that these products are no longer 

available on the market. (AHAM, No. 16 

at p. 3; ALS, No. 13 at p. 2; GE, No. 20 

at p. 1; Whirlpool, No. 22 at p. 3) AWE 

stated that suds-saving is not a new or 

proprietary technology, but that it is 

starting to make a comeback. AWE 

further stated DOE should consider suds 

saving in its analysis. (AWE, No. 12 at 

p. 3) In its research, DOE did not 

identify any suds-saving residential 

clothes washers on the market in the 

United States. For this reason, and in 

accordance with general support among 

interested parties, DOE is eliminating 

the top-loading semi-automatic and 

suds-saving product classes in this final 

rule. 

2. Product Class Differentiation by 

Method of Access 

In the framework document, DOE also 

sought comment as to whether the 

method of loading clothes washers, or 

any other characteristic commonly 

associated with traditional top-loading 

or front-loading clothes washers are 

‘‘features’’ within the meaning of 42 

U.S.C. 6295(o)(4) in EPCA and whether 

the availability of such feature(s) would 

likely be affected by eliminating the 

separate classes for these product types 

previously established by DOE. More 

specifically, DOE invited comments on 

whether one or more of the 

characteristics commonly associated 

with different types of clothes washers, 

such as method of loading, presence or 

absence of agitators, ability to interrupt 

cycles and possibly others, provide 

consumer utility that should, under 

existing law, be recognized and 

protected by DOE in separate product 

classes. 

a. Single Product Class 

ACEEE, ASAP, Electrolux Home 

Products (EHP), NEEP, Pacific Gas and 

Electric Company (PG&E), and 

Samsung, along with PG&E, Southern 

California Gas Company (SCG), and 

Southern California Edison (SCE), 

jointly (hereafter ‘‘California Utilities’’) 

and ASAP, NRDC, and NCLC, jointly 

(hereafter, ‘‘Joint Comment’’ 11), 

supported a single product class for all 

standard-size clothes washers, 

eliminating the differentiation based on 

method of loading. According to BSH, 

the California Utilities, Earthjustice, the 

Joint Comment, and NEEP, a single 

product class would not lessen utility or 

performance under EPCA. ASAP and 

the California Utilities commented that 

a single product class would not 

eliminate top-loaders from the market, 

and AWE noted that there are high 

efficiency top-loading clothes washers 

available. ASAP and the Joint Comment 

stated that there are at least 35 clothes 

washer models from four manufacturers 

on the current ENERGY STAR list. BSH 

commented that with the current 

differentiation between top-loading and 

front-loading clothes washers, 

consumers may assume that a high 

efficiency top-loader is more efficient 

than a ‘‘worst-in-class’’ front-loader if 

they are both ENERGY STAR rated, 

even though the reverse may be true. 

The California Utilities noted that there 

are currently 10–15 top-loading 

residential clothes washers in the 

California Energy Commission (CEC) 

database that are Consortium for Energy 

Efficiency (CEE) Tier 2 or better, and 

top-loading horizontal-axis clothes 

washers with efficiencies comparable to 

front-loading clothes washers are 

prevalent in some European markets. 

Samsung noted that utility rebates and 

certain energy labeling programs do not 

differentiate by clothes washer axis. 

(ACEEE, Public Meeting Transcript, No. 

7 at p. 46; ASAP, Public Meeting 

Transcript, No. 7 at pp. 34–35, p. 45; 

AWE, No. 12 at p. 2; BSH, No. 11 at p. 

2; California Utilities, No. 19 at pp. 1, 

3; EHP, No. 18 at p. 2; Earthjustice, 

Public Meeting Transcript, No. 7 at p. 

42; Earthjustice, No. 17 at p. 1; Joint 

Comment, No. 15 at p. 4; NEEP, No. 21 

at pp. 1–2; PG&E, Public Meeting 

Transcript, No. 7 at p. 43; Samsung, No. 

25 at p. 3) 

According to EHP, NEEP, and 

Samsung, the method of access for 

loading clothing is not a feature that 

provides utility to the consumer. EHP 

stated that manner of access was merely 

a convenience. BSH commented that the 

vast majority of clothes washers are sold 

with dryers, and clothes dryers are 

front-loading. (BSH, No. 11 at p. 2; EHP, 

No. 18 at p. 2; NEEP, No. 21 at p. 1; 

Samsung, No. 25 at p. 3) 

b. Multiple Product Classes 

AHAM, ALS, and GE stated that they 

support the proposed product classes, 

which maintain the distinction between 

top-loading and front-loading 

residential clothes washers. (AHAM, 

No. 24 at p. 2; ALS, Public Meeting 

Transcript, No. 7 at p. 39; GE, No. 20 at 

p. 1) ALS and GE commented that ‘‘toploading’’ is a feature within the meaning 

of EPCA, although ALS believes that 

‘‘vertical-axis’’ and ‘‘horizontal-axis’’ are 

better terms because a horizontal-axis 

clothes washer can be configured to be 

top-loading. (ALS, No. 13 at p. 3; GE, 

No. 20 at p. 1) 

AHAM and Whirlpool stated that 

multiple product classes for residential 

clothes washers would be consistent 

with classes that DOE has defined for 

other products. AHAM stated that 

multiple product classes were defined 

for refrigerator-freezers primarily on the 

basis of door placement. Whirlpool 

commented that multiple refrigeratorfreezer classes reflect consumer choice 

and utility, while room air conditioner 

product classes also reflect consumer 

choice and utility as well as home 

configuration. (AHAM, No. 24 at p. 2; 

Whirlpool, No. 22 at p. 3) 

GE commented that, in contrast to 

front-loading residential clothes 

washers, the vast majority of top-loading 

products are manufactured in the 

United States and provide an important 

source of U.S. jobs in these 

manufacturing locations. According to 


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12This comment refers to DOE’s denial of the 

California Energy Commission’s petition for waiver 

from Federal preemption of its residential clothes 

washer water conservation standards. 71 FR 78157 

(Dec. 28, 2006). On October 28, 2009, for reasons 

unrelated to product class issues, the Ninth Circuit 

U.S. Court of Appeals reversed DOE’s ruling and 

remanded CEC’s petition for further review. 

California Energy Comm’n v. DOE, 585 F.3d 1143 

(9th Cir. 2009) 

13The CA Utilities cited the 2001 Residential 

Clothes Washer Final Rule TSD, Appendices I and 

J. Appendix J details results of consumer analysis 

performed to determine what clothes washer 

attributes consumers value most and how changes 

in those attributes as a result of standards would 

affect consumer utility and clothes washer prices. 

Focus group results placed axis of rotation 12th and 

door placement as 7th out of a list of 65 possible 

GE, the U.S. manufacturers with 

significant investment in these toploading products produced domestically 

could be significantly disadvantaged 

should standards eliminate top-loaders. 

(GE, No. 20 at p. 3) 

AHAM commented that DOE already 

addressed the product class issue for 

residential clothes washers in its denial 

of California’s Petition for Waiver.12

(AHAM, Public Meeting Transcript, No. 

7 at p. 43) 

Finally, the Joint Petition proposes 

energy conservations standard levels for 

both the top-loading and front-loading 

standard and compact product classes. 

(Joint Petition, No. 32 at 8) 

c. Consumer Utility 

DOE received additional comments 

regarding specific issues that interested 

parties suggested are related to 

consumer utility in the context of 

residential clothes washer product 

classes. 

Cycle Time 

AHAM, ALS, and GE stated that the 

longer cycle times of front-loading 

clothes washers support differentiation 

of product classes by method of access. 

According to ALS, cycle times longer 

than 85 minutes are necessary for frontloaders to achieve good wash 

performance, which can be achieved in 

a 55-minute wash cycle by a top-loader. 

(AHAM, No. 24 at p. 2; ALS, No. 13 at 

p. 4; GE, No. 20 at p. 2) 

The California Utilities stated that it 

had conducted a preliminary survey 

indicating that there may not be 

significant differences in cycle times 

between top-loading and front-loading 

clothes washers. The Joint Comment 

noted that cycle times for front-loading 

clothes washers are becoming shorter. 

The California Utilities and the Joint 

Comment also suggested that the lower 

remaining moisture content (RMC) 

typical of front-loaders could lead to 

shorter clothes dryer cycle times, 

reducing the combined time of washing 

and drying a laundry load. (California 

Utilities, No. 19 at p. 3; Joint Comment, 

No. 15 at p. 4) 

Mid-Cycle Access 

ALS stated that garments can be 

added during a wash cycle in a toploading clothes washer, but that the 

loading door on a front-loading clothes 

washer must be locked. According to 

ALS, the door can be unlocked midcycle, but it requires time and may 

require draining the wash water. (ALS, 

No. 13 at p. 4) 

The California Utilities stated that 

many front-loading clothes washers are 

now equipped with a feature to unlock 

the door in the middle of a wash cycle. 

According to the Joint Comment, such a 

feature has been available on frontloaders for over a decade. (California 

Utilities, No. 19 at p. 3; Joint Comment 

No. 14 at p. 4) 

Cost 

ALS, GE, and Whirlpool stated that 

multiple product classes allow 

consumers a low-cost clothes washer 

option. ALS stated that purchase cost 

was the primary reason that top-loading 

residential clothes washers have 

maintained a majority of the market 

share, and that inherent differences 

between top-loading and front-loading 

designs will preclude comparable 

consumer cost for equivalent toploaders and front-loaders. ALS 

commented that key components 

contributing to the added cost of frontloading clothes washers are motors, 

electronic controls, heavy mass weights, 

and door assembly costs. ALS estimated 

that the front-loading door feature 

results in a manufacturing cost 

differential of $250 and a consumer 

price differential of at least $500 when 

compared to a top-loading door. Also, 

according to ALS, consumer objections 

to stooping have required manufacturers 

to introduce pedestals for front-loading 

clothes washers, adding $250 to the 

retail price. (ALS, No. 13 at p. 3; GE, 

Public Meeting Transcript, No. 7 at p. 

41; GE, No. 20 at p. 1; Whirlpool, No. 

22 at p. 2) GE stated that a single 

product class would force extremely 

expensive technological changes on the 

industry. GE also commented that 

increased prices would have a 

disproportionate impact on low-income 

consumers who are especially sensitive 

to price. According to GE, these 

consumers may be unable to make high 

initial payments or obtain credit, and 

may choose to defer replacing older, less 

efficient clothes washers or to leave the 

home laundry market altogether. (GE, 

No. 20 at pp. 1, 3) 

EHP commented that, in the past, 

manufacturers have been able to 

innovate to meet improved performance 

while maintaining cost. EHP also stated 

that payback in the form of lower energy 

and water costs would offset a higher 

initial cost of high efficiency toploading clothes washers. (EHP, No. 18 at 

p. 2) The Joint Comment stated that high 

efficiency top-loading clothes washers 

are available on the market priced near 

or below $500. (Joint Comment, No. 15 

at p. 4) 

Consumer Preference and Market Share 

According to AHAM, ALS, GE, and 

Whirlpool, consumer preference 

supports maintaining clothes washer 

product class distinction by method of 

access. ALS commented that most 

consumers prefer not to stoop or bend 

while loading clothes, which is not 

required for a top-loading clothes 

washer. GE estimated that top-loading 

residential clothes washers account for 

about 65 percent of the U.S. market. 

Whirlpool commented that one-third of 

consumers who purchased front-loaders 

have switched back to high-efficiency 

top-loaders. Whirlpool listed as 

contributing factors the existence of 

high efficiency top-loading clothes 

washers with better utility than frontloaders in terms of ergonomics, 

vibration, noise, cycle times, value 

proposition, sour smell, ease of use, and 

familiarity. Whirlpool further noted that 

front-loader sales have slowed even 

though 84 percent of consumers say 

energy conservation is very important to 

them when buying an appliance. ALS 

stated that it had recently received a 

letter from a consumer supporting 

Whirlpool’s statement that many 

consumers who purchased front loaders 

subsequently switched back to top 

loaders. (AHAM, No. 24 at p. 2; ALS, 

Public Meeting Transcript, No. 7 at p. 

45; ALS, No. 13 at pp. 2, 4; GE, No. 20 

at pp. 1–2; Whirlpool, Public Meeting 

Transcript, No. 7 at p. 44; Whirlpool, 

No. 22 at pp. 2–3) 

EHP stated that the means of loading 

is merely a convenience factor for 

consumers. (EHP, No. 18 at p. 2) ASAP, 

the California Utilities, NEEP, and PG&E 

commented that the growth in frontloader market share from 15 percent 5 

years ago to approximately 35 percent 

now indicates that consumer preference 

for front-loading clothes washers has 

shifted dramatically recently. The 

California Utilities also stated that 

consumer preference research that DOE 

commissioned for the last residential 

clothes washer energy conservation 

rulemaking indicated that concern for 

axis of rotation and door placement was 

scored low by consumers.13 PG&E and 


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Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 32319 

features. The TSD is available at 

www1.eere.energy.gov/buildings/ 

appliance_standards/residential/ 

clothes_washers.html. 

the California Utilities suggested that 

DOE conduct an analysis of consumer 

preferences to assess current market 

conditions and trends. (ASAP, Public 

Meeting Transcript, No. 7 at p. 45; 

California Utilities, No. 19 at p. 3; NEEP, 

No. 21 at pp. 1–2; PG&E, Public Meeting 

Transcript, No. 7 at pp. 31, 43) 

Other Features 

GE listed larger capacity, reduced 

vibration, and better cleaning 

performance as additional utilities of 

top-loading residential clothes washers. 

(GE, No. 20 at pp. 2–3) 

d. DOE Response 

EPCA provides the criteria under 

which DOE may define classes for 

covered equipment: 

A rule prescribing an energy 

conservation standard for a type (or 

class) of covered products shall specify 

a level of energy use or efficiency higher 

or lower than that which applies (or 

would apply) for such type (or class) for 

any group of covered products which 

have the same function or intended use, 

if the Secretary determines that covered 

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 from that 

which applies (or will apply) to other 

products within such type (or class). 

In making a determination under this 

paragraph concerning whether a 

performance-related feature justifies the 

establishment of a higher or lower 

standard, the Secretary shall consider 

such factors as the utility to the 

consumer of such a feature, and such 

other factors as the Secretary deems 

appropriate. 42 U.S.C. 6295(q) 

In previous rulemakings, DOE has 

concluded that the method of loading 

clothes in washers (axis of access) is a 

‘‘feature’’ within the meaning of 42 

U.S.C. 6295(o)(4) and, consequently, 

established separate product classes for 

top-loading and front-loading 

residential clothes washers. 56 FR 

22263 (May 14, 1991). 

In reviewing comments submitted by 

interested parties in response to the 

framework document for the current 

rulemaking, DOE identified at least one 

consumer utility related to the method 

of loading clothes for residential clothes 

washers which represents a ‘‘feature’’ 

for purposes of 42 U.S.C. 6295(o)(4). 

Specifically, DOE believes that the 

longer cycle times of front-loading 

residential clothes washers versus cycle 

times for top-loaders are likely to impact 

consumer utility. (See chapter 5 of the 

direct final rule TSD.) Because the 

longer wash cycle times for frontloaders arise from the reduced 

mechanical action of agitation as 

compared to top-loaders, DOE believes 

such longer cycles may be required to 

achieve the necessary cleaning, and 

thereby constitute a performance-related 

utility of front-loading versus toploading residential clothes washers 

pursuant to the meaning of 42 U.S.C. 

6295(q). 

Based on a review of residential 

clothes washer models currently listed 

in the CEC product database, DOE 

concludes that capacity is not a 

meaningful differentiator between toploaders and front-loaders. DOE 

acknowledges that top-loading models 

from a single manufacturer achieve the 

highest capacity—4.3 cubic feet—but 

multiple front-loading models from two 

other manufacturers are rated at 4.1–4.2 

cubic feet. 

Interested parties did not submit 

sufficient information for DOE to 

evaluate the relative wash performance, 

vibration, noise, or odor of top-loading 

versus front-loading clothes washers. 

DOE does not consider first cost a 

‘‘feature’’ that provides consumer utility 

for purposes of EPCA analysis. DOE 

acknowledges that price is an important 

consideration to consumers, especially 

low-income purchasers, but DOE 

accounts for such consumer impacts in 

the LCC and PBP analyses conducted in 

support of this rulemaking. 

Given the above discussion, DOE 

concludes that top-loading washers 

provide consumer utilities that, in the 

context of residential clothes washers, 

are a feature for purposes of 42 U.S.C. 

6295(o)(4). Therefore, DOE retains the 

product class distinction between toploading and front-loading clothes 

washers in this final rule. 

In response to the comments related 

to impacts on the relative market share 

of top-loading versus front-loading 

residential clothes washers, DOE 

considered the cross-price elasticity of 

demand for top-loading and frontloading residential clothes washers in 

its shipments analysis. The results of 

this analysis are presented in chapter 9 

of the direct final rule TSD. 

Finally, DOE considered the impacts 

on manufacturers in its manufacturer 

impacts analysis (see chapter 12 of the 

direct final rule TSD). 

3. Compact Product Class 

ASAP, BSH, and EHP stated that DOE 

should consider defining a single 

compact product class encompassing 

both top-loading and front-loading 

clothes washers. Such a product class 

definition would shift front-loading 

compact-size clothes washers from the 

current front-loading product class to 

the existing top-loading compact 

product class, which would be 

redesignated simply as ‘‘compact’’ to 

eliminate the top-loading distinction. 

Alternatively, BSH proposed that a 

compact front-loading product class be 

defined with a capacity equal to or less 

than two cubic feet. BSH commented 

that compact-size front-loaders would 

have difficulty achieving the same 

efficiency as standard-size front-loaders, 

yet they provide specific utility due to 

their ability to fit in small living spaces 

in areas of high population density. 

AHAM and BSH noted that capacity is 

one of the general criteria for defining 

separate product classes. (ASAP, Public 

Meeting Transcript, No. 7 at p. 47; BSH, 

Public Meeting Transcript, No. 7 at p. 

40; BSH, No. 11 at pp. 2, 3, 5; EHP, No. 

18 at p. 2) 

The Joint Petition proposes a new 

front-loading, compact product class 

and proposes energy conservations 

standard levels for both the top-loading 

and front-loading compact product 

classes. (Joint Petition, No. 32 at p. 8) 

Based on these comments, DOE is 

retaining the top-loading compact 

product class and adding a front-loading 

compact product class, as proposed in 

the Joint Petition. 

4. Product Class Summary 

Table III–1 presents the product 

classes set forth in DOE’s regulations at 

10 CFR 430.32(g) and the product 

classes established in this rulemaking. 

TABLE III–1—CLOTHES WASHER

PRODUCT CLASSES

Product classes in 

430.32(g) 

Product classes 

established in this 

rulemaking 

i. Top-loading, compact (less than 1.6 

cubic feet capacity.

i. Top-loading, compact (less than 1.6 

cubic feet capacity). 

ii. Top-loading, standard (1.6 cubic feet 

or greater capacity).

ii. Top-loading, standard (1.6 cubic feet 

or greater capacity). 

iii. Top-loading, semiautomatic.iii. Front-loading, 

compact (less than 

1.6 cubic feet capacity). 


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32320 Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 

TABLE III–1—CLOTHES WASHER

PRODUCT CLASSES—Continued 

Product classes in 

430.32(g) 

Product classes 

established in this 

rulemaking 

iv. Front-loading ........ iv. Front-loading, 

standard (1.6 cubic 

feet or greater capacity). 

v. Suds-saving.

B. Test Procedure 

As noted previously, the DOE test 

procedures for residential clothes 

washers appear at 10 CFR part 430, 

subpart B, appendices J1 and J2. Until 

the compliance date of the amended 

energy and water conservation 

standards established in today’s direct 

final rule, absent withdrawal of the rule 

by DOE pursuant to 42 U.S.C. 

6295(p)(4), manufacturers must use the 

test procedures at appendix J1 to certify 

compliance. Subsequently, 

manufacturers must use the test 

procedures at appendix J2. 

DOE established the test procedure at 

appendix J2 on March 7, 2012 (77 FR 

13888) to incorporate standby mode 

energy consumption as well as to 

update various active mode testing 

provisions. EISA 2007 amended EPCA 

to require DOE to amend its test 

procedures to integrate measures of 

standby mode and off mode energy 

consumption into the overall energy 

efficiency, energy consumption, or other 

energy descriptor for each covered 

product unless the current test 

procedure already fully accounts for and 

incorporates standby and off mode 

energy consumption or such integration 

is technically infeasible. (42 U.S.C. 

6295(gg)(2)) In addition to incorporating 

standby power provisions, DOE 

received comments in response to the 

August 2009 framework document 

stating that it should also consider 

changes to the active mode provisions 

in the test procedure. 

DOE published a notice of proposed 

rulemaking issued on September 21, 

2010 (75 FR 57556) (hereinafter referred 

to as the September 2010 TP NOPR) to 

propose amendments regarding both 

standby mode and active mode 

provisions of the test procedure, 

including the following: (1) 

Incorporating standby and off mode 

power consumption into a combined 

energy metric; (2) addressing 

technologies not covered by the 

appendix J1 test procedure, such as 

steam wash cycles and self-clean cycles; 

(3) revising the number of annual wash 

cycles; (4) updating use factors; (5) 

revising the procedures and 

specifications for test cloth; (6) 

redefining the appropriate water fill 

level for the capacity measurement 

method; (7) establishing a new measure 

of water consumption; and (8) revising 

the definition of the energy test cycle. 

The International Electrotechnical 

Commission (IEC) published IEC 

Standard 62301, ‘‘Household electrical 

appliances—Measurement of standby 

power,’’ Edition 2.0 2011–01 (IEC 

Standard 62301 (Second Edition)) on 

January 27, 2011. DOE reviewed this 

updated test procedure and determined 

that it improves the measurement of 

standby mode and off mode energy use 

compared to the previous version of the 

standard. Therefore, DOE published a 

supplemental notice of proposed 

rulemaking on August 9, 2011 (76 FR 

49238) (hereinafter referred to as the 

August 2011 TP SNOPR) to integrate 

new measures of standby power 

consumption according to IEC Standard 

62301 (Second Edition) and to 

incorporate additional amendments to 

the active mode provisions, including 

the following: (1) Revising the 

calculations for per-cycle energy use 

and annual energy cost; (2) updating the 

load adjustment factor; (3) clarifying the 

method for determining the energy test 

cycle; (4) clarifying the method for 

setting the wash time for certain clothes 

washers; (5) allowing the use of the 

most current AHAM Standard detergent; 

(6) clarifying the definition of ‘‘cold 

wash’’ for clothes washers that offer 

both ‘‘cold wash’’ and ‘‘tap cold wash’’ 

settings; and (7) performing various 

minor technical corrections. DOE 

published a second supplemental notice 

of proposed rulemaking on November 9, 

2011 (76 FR 69870) to propose a revised 

definition of the energy test cycle. DOE 

published the final rule on March 7, 

2012 (77 FR 13888), establishing the test 

procedure at appendix J2. 

When conducting the test procedure 

rulemaking, DOE considered comments 

received on the clothes washer test 

procedure submitted as part of this 

rulemaking for energy conservation 

standards. In the framework document, 

DOE requested input on its test 

procedures for residential clothes 

washers and sought input, including 

supporting data, regarding how these 

procedures can be improved. In 

response to the framework document, 

DOE received several comments from 

interested parties regarding potential 

amendments to the DOE clothes washer 

test procedure to address the following 

issues: (1) The capacity measurement; 

(2) the test load size specification; (3) 

the energy and water use of self-clean 

cycles; (4) the energy and water use of 

steam cycles; (5) parameters 

representing consumer usage patterns; 

(6) the addition of a cleaning 

performance metric; (7) the remaining 

moisture content (RMC) measurement; 

(8) the measurement of standby and off 

mode energy use; (9) test cloth issues; 

(10) technical edits; and (11) anticircumvention. 

1. Capacity Measurement 

DOE’s clothes washer test procedure 

at appendix J1 states that, for measuring 

the capacity of the clothes washer, the 

clothes container shall be manually 

filled with water to ‘‘its uppermost 

edge.’’ This requirement can be 

interpreted in multiple ways, resulting 

in different capacity measurements that 

would each be allowable under the test 

procedure. 

The Joint Comment stated that DOE 

should ensure that all data collected for 

this rulemaking be based on a consistent 

measurement of capacity, particularly 

because advertised capacity may be 

expressed using a conversion factor of 

15/13 applied to the capacity measured 

under the DOE test procedure to 

approximate the capacity that would be 

measured using the international test 

standard promulgated by the IEC. The 

Joint Comment and Samsung stated that 

the measured clothes container volume 

can exceed the wetted space occupied 

by laundry by 15–20 percent or more. 

This could result in similar variation in 

MEF. The Joint Comment suggested that 

DOE determine whether such 

measurement uncertainty still exists for 

current vertical-axis clothes washers, 

and whether the capacity measurement 

in the test procedure should be 

modified for both vertical-axis and 

horizontal-axis clothes washers. (Joint 

Comment, No. 15, p. 2; Samsung, No. 25 

at p. 1) ASAP commented that DOE 

should understand the difference 

between advertised capacity and the 

capacity that is reported to ENERGY 

STAR, the CEC, and other public 

databases, because the advertised 

capacity is typically larger than the 

reported values. (ASAP, Public Meeting 

Transcript, No. 7 at p. 20) 

ALS commented that the test 

procedure should be revised to clarify 

that, for vertical-axis clothes washers, 

the ‘‘uppermost edge’’ would refer to the 

‘‘top of the tub cover.’’ (ALS, Public 

Meeting Transcript, No. 7 at p. 22; ALS, 

No. 13 at p. 1) Samsung commented that 

there are various interpretations of what 

constitutes the usable volume and how 

the capacity is measured on vertical-axis 

clothes washers. According to Samsung, 

one such interpretation is to measure 

the volume to the top of the tub cover, 

even though the user is instructed to 

load to below the tub cover in a typical 


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use and care guide. Samsung estimates 

that loading to the top of the tub cover 

could result in a 15–20 percent increase 

in the capacity measurement of verticalaxis clothes washers (compared to 

loading to the level recommended in the 

use and care guide), which would also 

overstate the MEF and WF of the unit 

by 15–20 percent. Therefore, Samsung 

proposed possible language to clarify 

the capacity measurement in DOE’s 

clothes washer test procedure based on 

wording from IEC Standard 60456, 

‘‘Clothes washing machines for 

household use—Methods for measuring 

the performance,’’ (IEC Standard 60456) 

Edition 5, Committee Draft for Vote 

(FDIS). The fill level in the DOE test 

procedure would thus be defined as the 

‘‘uppermost edge which may be used to 

fill in clothes, respecting manufacturer 

instructions.’’ (Samsung, No. 25 at p. 1) 

BSH commented that a volumetric 

capacity metric is misleading when 

comparing conventional vertical-axis, 

high efficiency vertical-axis, and 

horizontal-axis clothes washers because 

more volume does not necessarily 

correspond with more load capacity. 

Performance should be related to load 

size rather than drum volume for 

consumer comparisons. (BSH, No. 11 at 

p. 2) 

DOE recognizes that the clothes 

container capacity measurement in 

appendix J1 could be interpreted in 

multiple ways. To provide 

manufacturers with additional guidance 

prior to issuance of the March 2012 TP 

final rule, DOE issued an interpretive 

rule on July 26, 2010. In the interpretive 

rule, DOE provided clarifications to the 

methods for measuring clothes 

container capacity for both top-loading 

and front-loading clothes washers using 

the appendix J1 test procedure. This 

interpretive rule can be found on DOE’s 

Web site at: www1.eere.energy.gov/ 

buildings/appliance_standards/ 

residential/pdfs/cw_guidance_faq.pdf. 

In the March 2012 TP final rule, DOE 

established a different capacity 

measurement procedure at appendix J2 

to provide for a clearer, more consistent 

and more easily repeatable 

measurement. Under appendix J1, 

DOE’s guidance document instructs 

manufacturers to measure the fill level 

for top-loading clothes washers at the 

innermost diameter of the tub cover 

(defined as ‘‘Fill Level 3’’ in the 

guidance). For the reasons discussed in 

the March 2012 TP final rule, the 

revision to the capacity measurement in 

appendix J2 requires manufacturers to 

measure the fill level for top-loading 

clothes washers to the uppermost edge 

of the rotating portion of the basket, 

including the balance ring (defined as 

‘‘Fill Level 2’’ in DOE’s interpretive 

guidance). 

For front-loaders, under both 

appendix J1 and appendix J2, the fill 

level must not exceed the highest point 

of contact between the door and the 

door seal, excluding any portion of the 

door or door seal that would occupy the 

measured volume space when the door 

is closed. This is consistent with the 

instructions provided for front-loaders 

in DOE’s guidance document. 

DOE used the revised capacity 

measurement for top-loaders in 

determining the conversion formulas 

from MEF to IMEF and WF to IWF in 

today’s final rule. For more details of 

the testing and analysis, see chapter 5 of 

the direct final rule TSD. 

DOE notes that the FTC promulgates 

labeling requirements for residential 

clothes washers, which would govern 

marketing claims made by the 

manufacturer regarding capacity. 

2. Test Load Size 

Table 5.1 of the DOE clothes washer 

test procedure specifies test cloth load 

sizes necessary to conduct the energy 

cycles. Minimum, maximum, and 

average load sizes are defined as a 

function of clothes washer capacity. 

Currently, the maximum load size 

provided in the table is 3.80 cubic feet 

(ft3). No provision exists for determining 

load size if capacity exceeds that limit. 

10 CFR 430 subpart B appendix J1. 

AHAM, ALS, GE and Whirlpool 

support a linear extension of the load 

size table to larger capacities. AHAM, 

GE, and Whirlpool recommend 

extending the table for capacities up to 

6.0 ft3. Whirlpool noted that DOE 

granted a waiver which extended the 

table to a capacity of 4.1 ft3, and ALS 

stated it agreed with this waiver. 

(AHAM, Public Meeting Transcript, No. 

7 at p. 21; AHAM, No. 16 at p. 2; ALS, 

No. 13 at p. 1; GE, No. 20 at p. 1; 

Whirlpool, No. 22 at p. 1) The Joint 

Comment objected to the extension of 

Table 5.1 to a capacity of 6 ft3 without 

verifying the validity of the resulting 

load sizes with current consumer data. 

(Joint Comment, No. 15 at pp. 1–2) 

DOE reviewed current residential 

clothes washer product databases from 

sources such as CEC and ENERGY 

STAR, and observed reported capacities 

as large as 4.7 ft3. In response to 

comments received in response to the 

September 2010 TP NOPR, DOE 

extended Table 5.1 in the amended test 

procedure to include capacities up to 

6.0 ft3 to accommodate additional 

increases in capacity expected in the 

future. As described fully in the 

September 2010 TP NOPR and March 

2012 TP final rule, DOE determined that 

the linear relationship between test load 

size and container capacity in appendix 

J1 is valid, and therefore used the same 

linear relationship to extend Table 5.1 

to 6.0 ft3. (17 FR 13888) 

3. Self Clean Cycles 

DOE’s clothes washer test procedure 

specifies energy test cycles, the energy 

and water use of which are averaged to 

calculate the MEF and WF of the unit 

under consideration. These energy test 

cycles are selected from among various 

cycle settings provided by the 

manufacturer for laundering clothing. 

They do not include any cycles or preset settings provided for the purpose of 

cleaning, sanitizing, or deodorizing any 

of the clothes washer components. DOE 

observed in its test sample of units for 

the preliminary analysis that a 

dedicated self-clean function is a 

prevalent feature, found in virtually all 

front-loading clothes washers and in 

certain top-loading models as well. 

ASAP and the Joint Comment stated 

that the measurement of MEF and WF 

should account for the energy and water 

use of self-clean cycles. The Joint 

Comment further stated that such a 

measurement would provide not only a 

more accurate assessment of machine 

efficiency, but also a benefit to those 

clothes washer designs that address 

mold and odor issues without requiring 

periodic sanitizing cycles. (ASAP, 

Public Meeting Transcript, No. 7 at p. 

19; Joint Comment, No. 15 at p. 3) 

In the September 2010 TP NOPR, DOE 

proposed a usage factor of 12 annual 

self-clean cycles for incorporating the 

energy used in self-clean cycles. DOE 

based its usage factor on typical 

manufacturer instructions that 

recommend using this feature once each 

month. DOE received comments stating 

that consumer usage data on self-clean 

cycles was insufficient to validate the 

usage factors it proposed in the test 

procedure NOPR. In addition, there is 

uncertainty as to whether a self-clean 

cycle should be tested only if it is a 

specific feature provided by the 

manufacturer, or if a conventional cycle 

that the manufacturer recommends the 

consumer to run periodically for the 

purpose of cleaning or sanitizing the 

clothes washer should also be tested as 

a self-clean cycle. Finally, DOE is 

concerned about the increased test 

burden required for testing self-clean 

cycles given the relatively small amount 

of annual energy used in these periodic 

cycles. For these reasons, DOE did not 

include the energy and water use of selfclean cycles in the modified test 

procedure. 


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4. Steam Cycles 

The energy test cycles specified in the 

DOE clothes washer test procedure do 

not include provisions for testing any 

cycles incorporating steam injection. 

DOE is aware of a number of clothes 

washers available on the market that 

offer a steam feature as either a standalone cycle or as an add-on to a 

traditional wash cycle. DOE notes that 

steam features are available on primarily 

some higher-end front-loading clothes 

washers. 

ASAP and the Joint Comment stated 

that DOE should amend the test 

procedure to account for the impact of 

steam cycle use. (ASAP, Public Meeting 

Transcript, No. 7 at p. 19; Joint 

Comment, No. 15 at p. 3) 

In the September 2010 TP NOPR, DOE 

proposed a temperature usage factor of 

0.02 to incorporate the energy used in 

steam cycles. DOE believed that extra 

hot and steam cycles would be reserved 

for the most heavily soiled loads, and 

would have similar use factors. DOE 

assumed that the steam wash cycles 

would be selected somewhat fewer 

times than the extra hot cycle because 

on some models steam is available only 

as an option on certain settings. DOE 

received comments stating that 

consumer usage data on steam cycles is 

insufficient to validate the temperature 

usage factors it proposed in the 

September 2010 TP NOPR. Furthermore, 

DOE notes that because there is 

significant variation in how individual 

manufacturers implement steam 

features, creating a universal definition 

of a steam cycle for the energy test cycle 

would be difficult. Finally, DOE is 

concerned about the increased test 

burden required for testing steam cycles 

given the relatively small amount of 

annual energy used in these cycles. For 

these reasons, DOE did not include the 

energy and water use of steam cycles in 

the modified test procedure. 

5. Consumer Usage Patterns 

Various factors are provided in the 

DOE clothes washer test procedure to 

properly account for consumer usage 

patterns, including the number of use 

cycles per year, selection of load sizes, 

selection of temperature settings, and 

the percentage of washed clothes loads 

that are dried in a clothes dryer. 

ALS supported reducing annual usage 

to 300 cycles, based on Procter & 

Gamble consumer studies. The Joint 

Comment stated DOE should collect 

data on current consumer laundry usage 

to validate or update the cycles per year, 

estimates of ‘‘average’’ load size among 

clothes washers of varying capacities, 

annual load size usage factors, 

temperature use factors, and dryer use 

factor. The Joint Comment stated that 

DOE should ensure that there is no 

systematic bias in these factors favoring 

larger capacities. The Joint Comment 

also requested that DOE reassess the 

load adjustment factor, which was 

established in the 1990s. (ALS, No. 13 

at p. 1; Joint Comment, No. 15 at 

pp. 1–3) 

In the March 2012 TP final rule, DOE 

reduced the number of annual cycles to 

295 based on a survey of available 

consumer usage data and comments 

received from interested parties. DOE 

increased the dryer usage factor to 0.91 

based on the most recent consumer 

survey data available. 

DOE is unaware of any updated 

consumer usage data regarding load 

sizes among clothes washers of varying 

capacities and load size usage factors. 

Therefore, DOE did not amend the load 

usage factors or the linear relationship 

used to determine load size based on 

clothes washer capacity in the modified 

test procedure. Similarly, DOE did not 

identify any evidence that suggests any 

unwarranted bias in favor or larger 

capacities in the test procedure. 

DOE received additional information 

from commenters regarding temperature 

use factors (TUFs). The information 

received contained significant 

disparities, however, and no 

information supporting particular TUFs 

was more persuasive or reliable than 

information supporting other TUFs. 

Therefore, the information provided no 

basis upon which to change the TUF 

values in the appendix J1 test 

procedure, and DOE retained these 

TUFs in appendix J2. DOE did, 

however, establish a new TUF for a full 

warm wash/warm rinse cycle and 

eliminated the incremental use factor 

attributed to warm rinse in appendix J1. 

Finally, DOE determined that the load 

adjustment factor (LAF) is duplicative 

of, yet inconsistent with, the load usage 

factors. Therefore, for consistency with 

the rest of the test procedure, DOE 

amended the representative load size 

calculation in the equation for drying 

energy to incorporate the load usage 

factors rather than a separate LAF. DOE 

replaced the LAF with a weightedaverage load size, calculated by 

multiplying the minimum, average, and 

maximum load usage factors by the 

minimum, average, and maximum load 

sizes, respectively, and summing the 

products. 

6. Standard Extractor RMC Test 

Procedure 

The DOE test procedure contains 

provisions for evaluating the moisture 

absorption and retention characteristics 

of a lot of test cloth by measuring the 

RMC in a standard extractor at a 

specified set of conditions. 

AHAM submitted detailed 

recommendations of changes to the 

methodology used for the Standard 

Extractor RMC Test Procedure included 

in the overall clothes washer test 

procedure. Whirlpool and GE stated that 

they support AHAM’s 

recommendations. (AHAM, Public 

Meeting Transcript, No. 7 at p. 21; 

AHAM, No. 16 at p. 2; GE, No. 20 at p. 

1; Whirlpool, No. 22 at p. 1) DOE largely 

agrees with AHAM’s recommendations 

and implemented many of them in the 

revised test procedure. 

7. Performance Metric 

DOE’s clothes washer test procedure 

provides a measure of representative 

energy and water use. It does not 

evaluate cleaning or rinsing 

performance or fabric care. AHAM, 

BSH, GE, and Whirlpool commented 

that DOE should add a performance 

measure, particularly because at the 

higher efficiency levels, clothes washers 

are reaching the limit where product 

performance and consumer satisfaction 

may not be economically reached. 

AHAM noted that its clothes washer 

standard, ANSI/AHAM HLW–1–2007, 

‘‘Performance Evaluation Procedures for 

Household Clothes Washers,’’ addresses 

performance and is substantially 

harmonized with IEC Standard 60456. 

Whirlpool also noted that ANSI/AHAM 

HLW–1–2007 provides performance 

measurement. ALS and BSH also 

recommended review of IEC Standard 

60456 for methods of assessing 

performance, and ALS recommended 

review of the Australian standard AS/ 

NZS 2040.1. (AHAM, No. 16 at p. 2; 

ALS, No. 13 at p. 2; BSH, No. 11 at p. 

2; GE, No. 20 at p. 1; Whirlpool, No. 22 

at p. 2) ALS stated it had not yet 

determined whether it would support a 

performance metric, or what a 

measurement method for measuring 

performance would be, although it 

added that it is concerned that energy 

conservation standards have reached the 

point where higher levels will cause 

unacceptable performance, especially 

for vertical-axis top-loaders. (ALS, No. 

13 at p. 1) 

DOE test procedures must be 

reasonably designed to produce test 

results that measure energy efficiency, 

energy use, water use in specified 

instances, or estimated annual operating 

cost of a covered product during a 

representative use cycle or period of 

use. 42 U.S.C. 6293(b)(3). DOE notes 

that the measurement of energy 

efficiency or energy or water use 

presumes the proper functioning of a 


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14 Definitions of operating modes, including cycle 

finished, delayed start, active washing, inactive, 

and off modes, are provided in the March 2012 TP 

final rule. 77 FR 13888. 

15The notation in the form ‘‘AHAM, IRRR, No. 10 

at pp. 5–6’’ identifies a written comment that DOE 

has received and has included in the docket of the 

Request for Information (RFI) to implement 

Executive Order 13563, ‘‘Improving Regulation and 

Regulatory Review (76 FR 6123, Feb. 3, 2011). 

(Docket No. DOE–HQ–2011–0014). This particular 

notation refers to a comment (1) submitted by 

Association of Home Appliance Manufacturers 

(AHAM), (2) in document number 10 in the docket 

of that RFI, and (3) appearing on pages 5–6 of 

document number 10. 

product. DOE considers utility in setting 

energy conservation standards, and DOE 

may not prescribe a standard that is 

likely to result in the unavailability in 

the United States of performance 

characteristics, including reliability. 

42 U.S.C. 6295(o)(2)(B)(i)(IV), (o)(4) DOE 

has considered performance generally in 

the development of these standards and 

does not believe that the standards 

established in today’s final rule would 

adversely impact the utility of 

residential clothes washers. 

8. Standby Power 

In the framework document, DOE 

noted that it considered incorporating 

certain provisions of IEC Standard 

62301, ‘‘Household electrical 

appliances–Measurement of standby 

power’’, First Edition 2005–06 (IEC 

Standard 62301 (First Edition)) in 

accordance with requirements of EISA 

2007. DOE further noted that it would 

consider an updated version of IEC 

Standard 62301 in its residential clothes 

washer test procedure rulemaking. In 

response to the framework document, 

DOE received comments regarding the 

inclusion of standby and off mode 

power consumption in its clothes 

washer test procedure and its 

consideration of the updated version of 

IEC Standard 62301. 

ALS commented that it supports 

revising the test procedure to add 

provisions for measuring standby 

power. (ALS, No. 13, No. 1) The 

California Utilities stated that DOE 

should make a determination of the 

metrics that it will use for clothes 

washer energy conservation standards, 

because if standby and off mode power 

is incorporated, MEF might not be used 

to regulate clothes washers in this 

rulemaking. According to the California 

Utilities, it would be detrimental to 

proceed with the preliminary analysis 

without finalizing possible changes to 

the metric. (California Utilities, No. 19 

at p. 1) Whirlpool stated that standby 

power should be incorporated into MEF, 

rather than addressed as a separate 

metric. (Whirlpool, No. 22 at p. 2) 

ASAP, the California Utilities, the Joint 

Comment, and NEEP urged DOE to 

proceed with the clothes washer test 

procedure rulemaking without waiting 

further for the release of an updated 

version of IEC Standard 62301. (ASAP, 

Public Meeting Transcript, No. 7 at p. 

18; California Utilities, No. 19 at p. 1; 

Joint Comment, No. 15 at p. 1; NEEP, 

No. 21 at p. 1) ASAP also commented 

that the mode definitions in IEC 

Standard 62301 are not necessarily 

comparable to DOE’s statutory mode 

definitions, and that it may not be 

advisable to use the IEC definitions. 

(ASAP, Public Meeting, No. 7 at p. 19) 

In the September 2010 TP NOPR, DOE 

proposed to incorporate by reference 

into the clothes washer test procedure 

specific provisions from IEC Standard 

62301 (First Edition) regarding test 

conditions and test procedures for 

measuring standby mode and off mode 

power consumption. DOE also proposed 

to adopt certain provisions from the IEC 

Standard 62301 Committee Draft for 

Vote (CDV) version (an earlier draft 

version of the IEC 62301 revision), as 

well as the Final Draft International 

Standard (FDIS) version (the draft 

version developed just prior to the 

issuance of the Second Edition). 

Specifically, DOE proposed to adopt the 

30-minute stabilization and 10-minute 

measurement periods as described in 

the CDV version and the mode 

definitions for active, standby and off 

mode as described in the FDIS version. 

In the August 2011 TP SNOPR, DOE 

evaluated IEC Standard 62301 (Second 

Edition) and concluded that the 

application of the provisions of the 

Second Edition to all power 

measurements in standby mode and off 

mode for clothes washers would be an 

improvement over the First Edition and 

would not be unduly burdensome to 

conduct. Therefore, DOE proposed 

incorporating by reference the relevant 

paragraphs of section 4 and section 5 of 

IEC Standard 62301 (Second Edition) in 

the clothes washer test procedure. 

In the March 2012 TP final rule, DOE 

incorporated by reference the relevant 

paragraphs of section 4 and section 5 of 

IEC Standard 62301 (Second Edition) in 

the clothes washer test procedure. DOE 

integrated standby and off mode energy 

use into its revised clothes washer test 

procedure by establishing an IMEF 

metric based on measurements made 

according to certain provisions of this 

updated IEC standard. 77 FR 13888. 

Accordingly, DOE based its analysis for 

clothes washer energy conservation 

standards in today’s direct final rule on 

this IMEF metric. 

DOE notes that AHAM provided a 

related comment in response to the 

Request for Information (RFI) issued by 

DOE to implement Executive Order 

13563, ‘‘Improving Regulation and 

Regulatory Review (76 FR 6123, Feb. 3, 

2011), opposing any test procedure 

requirement to measure separately the 

energy use of delay start and cycle 

finished modes.14 AHAM stated that the 

additional burden that would be 

required to measure a de minimis 

amount of energy would not be justified. 

(AHAM, IRRR, No. 10 at pp. 5–6) 15

Based on the results of the data 

presented in the August 2011 TP 

SNOPR, DOE believes that including a 

specific measurement of energy use of a 

cycle finished feature that incorporates 

intermittent tumbling and air 

circulation would not significantly 

impact the total annual energy 

consumption. Furthermore, measuring 

the energy use over the entire duration 

of cycle finished mode would increase 

the test duration by up to 10 hours, 

depending on the maximum duration of 

cycle finished mode provided on the 

clothes washer under test. DOE believes 

this would represent a significant 

increase in test burden that would not 

be warranted by the minimal additional 

energy use captured by measuring cycle 

finished mode separately or as part of 

the active washing mode. 

Therefore, in the March 2012 TP final 

rule, DOE did not adopt provisions to 

measure cycle finished mode separately 

or as part of the active washing mode. 

DOE believes that measuring power 

consumption of each mode separately 

would introduce significant test burden 

without a corresponding improvement 

in a representative measure of annual 

energy use. Therefore, DOE provided in 

the March 2012 TP final rule for 

measuring total energy consumption, in 

which all low-power mode hours are 

allocated to the inactive and off modes, 

and the low-power mode power 

consumption is measured only in the 

inactive and off modes, depending on 

which of these modes is present. 

9. Test Cloth 

Different lots of energy test cloth used 

in the clothes washer test procedure are 

released to the industry at least once a 

year, and the properties of the test cloth 

must be measured and standardized 

against reference historical lots. AHAM 

and ALS support revisions to the 

clothes washer test procedure for 

improving the process to correlate new 

test cloth batches to the historical lots. 

AHAM provided a proposal for an 

industry-developed auditing program, 

as well as suggested specifications for 

test cloth tolerances. GE supports this 


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16The NIA spreadsheet model is described in 

section IV.G of this notice. 

proposal. (AHAM, Public Meeting 

Transcript, No. 7 at pp. 21–22; AHAM, 

No. 16 at p. 2; ALS, No. 13 at p. 1; GE, 

No. 20 at p. 1) Whirlpool noted that the 

test cloth is currently available from one 

supplier that has limited capability to 

meet industry’s needs. Whirlpool 

suggested that DOE assume 

responsibility for test cloth procurement 

and qualification. (Whirlpool, No. 22 at 

p. 1) DOE is currently working with 

industry, suppliers, and test laboratories 

to develop an auditing program that 

meets industry’s needs. Qualification 

tests are being conducted at an 

independent test laboratory as well as at 

DOE’s Appliance Testing and 

Evaluation Center (ATEC). 

10. Technical Edits 

AHAM and GE suggested that DOE 

remove obsolete sections of the clothes 

washer test procedure in guidelines that 

AHAM submitted to DOE on September 

22, 2008. (AHAM, Public Meeting 

Transcript, No. 7 at p. 21; AHAM, No. 

16 at p. 2; GE, No. 20 at p. 1) DOE 

agreed with these suggestions and 

removed the obsolete provisions in the 

revised test procedure as part of the 

residential clothes washer test 

procedure rulemaking. 

11. Anti-Circumvention 

EPCA requires that test procedures be 

reasonably designed to produce test 

results which measure energy 

efficiency, energy use, water use or 

estimated annual operating cost of a 

covered product during a representative 

average use cycle or period of use, as 

determined by the Secretary. 42 U.S.C. 

6293(b)(3). This statutory requirement 

may be undermined if products are 

purposefully designed to use controls or 

features that produce test results that are 

so unrepresentative of a product’s actual 

energy or water consumption as to 

provide materially inaccurate 

comparative data. The Joint Comment 

stated that DOE should ensure that the 

test procedure is not vulnerable to 

circumvention and should prohibit any 

mode or other operating function that is 

designed solely or primarily to reduce 

energy and water consumption during 

testing. According to the Joint 

Comment, sophisticated and 

inexpensive electronic controls may 

detect the DOE testing conditions and 

minimize energy and water use under 

those specific conditions. The Joint 

Comment described as an illustrative 

example a clothes washer with adaptive 

fill control that could be programmed to 

minimize the fill level when it 

measured a clothes load size at exactly 

the weight of the average DOE test load 

for that capacity machine. (Joint 

Comment, No. 15 at p. 3) DOE 

considered issues of circumvention in 

its clothes washer test procedure 

rulemaking. 

C. Technological Feasibility 

1. General 

In each 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. 10 CFR 430, 

subpart C, appendix A, section 4(a)(4)(i). 

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, or service; (2) 

adverse impacts on product utility or 

availability; and (3) adverse impacts on 

health or safety. Section IV.B of this 

notice discusses the results of the 

screening analysis for residential clothes 

washers, particularly the designs DOE 

considered, those it screened out, and 

those that are the basis for the efficiency 

levels considered in this rulemaking. 

For further details on the screening 

analysis for this rulemaking, see chapter 

4 of the direct final rule 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 residential clothes 

washers, using the design parameters 

that lead to the creation of the most 

efficient products available on the 

market or in working prototypes. (See 

chapter 5 of the direct final rule TSD.) 

The max-tech levels that DOE 

determined for this rulemaking are 

described in section IV.C.4 of this final 

rule. 

D. Energy Savings 

1. Determination of Savings 

DOE used its national impact analysis 

(NIA) spreadsheet model to estimate 

energy savings from amended standards 

for the products that are the subject of 

this rulemaking.16 For each TSL, DOE 

forecasted energy savings beginning in 

2015, the year that manufacturers would 

be required to comply with amended 

standards, and ending in 2044. DOE 

quantified the energy savings 

attributable to each TSL as the 

difference in energy consumption 

between the standards case and the base 

case. The base case represents the 

forecast of energy consumption in the 

absence of amended mandatory 

efficiency standards, and considers 

market demand for more efficient 

products. 

The NIA spreadsheet model calculates 

the electricity savings in site energy 

expressed in kilowatt-hours (kWh). Site 

energy is the energy directly consumed 

by appliances at the locations where 

they are used. DOE reports national 

energy savings on an annual basis in 

terms of the aggregated source (primary) 

energy savings, which is the savings in 

the energy that is used to generate and 

transmit the site energy. (See chapter 10 

of the direct final rule TSD). To convert 

site energy to source energy, DOE 

derived annual conversion factors from 

the model used to prepare the Energy 

Information Administration’s (EIA) 

Annual Energy Outlook 2010 

(AEO2010). 

2. Significance of Savings 

As noted above, 42 U.S.C. 

6295(o)(3)(B) prevents DOE from 

adopting a standard for a covered 

product unless such standard would 

result in ‘‘significant’’ energy savings. 

Although the term ‘‘significant’’ is not 

defined in the Act, the U.S. Court of 

Appeals, in Natural Resources Defense 

Council v. Herrington, 768 F.2d 1355, 

1373 (D.C. Cir. 1985), indicated that 

Congress intended ‘‘significant’’ energy 

savings in this context to be savings that 

were not ‘‘genuinely trivial.’’ The energy 

savings for all of the TSLs considered in 

this rulemaking are nontrivial, and, 

therefore, DOE considers them 

‘‘significant’’ within the meaning of 

section 325 of EPCA. 


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E. Economic Justification 

1. Specific Criteria 

As noted in section II.A, 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)) The 

following sections discuss how DOE has 

addressed each of those seven factors in 

this rulemaking. 

a. Economic Impact on Manufacturers 

and Consumers 

In determining the impacts of an 

amended standard on manufacturers, 

DOE first uses an annual cash-flow 

approach to determine the quantitative 

impacts. This step includes both a shortterm assessment—based on the cost and 

capital requirements during the period 

between when a regulation is issued and 

when entities must comply with the 

regulation—and a long-term assessment 

over a 30-year analysis period. The 

industry-wide impacts analyzed include 

industry net present value (INPV), 

which values the industry on the basis 

of expected future cash flows, cash 

flows by year, changes in revenue and 

income, and other measures of impact, 

as appropriate. Second, DOE analyzes 

and reports the impacts on different 

types of manufacturers, including 

impacts on small manufacturers. Third, 

DOE considers the impact of standards 

on domestic manufacturer employment 

and manufacturing capacity, as well as 

the potential for standards to result in 

plant closures and loss of capital 

investment. Finally, DOE takes into 

account cumulative impacts of various 

DOE regulations and other regulatory 

requirements on manufacturers. 

For individual consumers, measures 

of economic impact include the changes 

in life-cycle cost (LCC) and payback 

period (PBP) associated with new or 

amended standards. The LCC, which is 

specified separately in EPCA as one of 

the seven factors to be considered in 

determining the economic justification 

for a new or amended standard, 42 

U.S.C. 6295(o)(2)(B)(i)(II), is discussed 

in the following section. For consumers 

in the aggregate, DOE also calculates the 

national net present value of the 

economic impacts throughout the 

forecast period applicable to a particular 

rulemaking. 

b. Life-Cycle Costs 

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 

savings for the considered efficiency 

levels are calculated relative to a base 

case that reflects likely trends in the 

absence of amended standards. The LCC 

analysis requires a variety of inputs, 

such as product prices, product energy 

consumption, energy prices, 

maintenance and repair costs, product 

lifetime, and consumer discount rates. 

In its analysis, DOE assumed that 

consumers will purchase the considered 

products in 2015. 

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. A 

distinct advantage of this approach is 

that DOE can identify the percentage of 

consumers estimated to receive LCC 

savings or experience an LCC increase, 

in addition to the average LCC savings 

associated with a particular standard 

level. In addition to identifying ranges 

of impacts, DOE evaluates the LCC 

impacts of potential standards on 

identifiable subgroups of consumers 

that may be affected disproportionately 

by a national standard. 

c. Energy Savings 

Although significant conservation of 

energy is a separate statutory 

requirement for imposing an energy 

conservation standard, EPCA requires 

DOE, in determining the economic 

justification of a standard, to consider 

the total projected energy savings that 

are expected to result directly from the 

standard. (42 U.S.C. 6295(o)(2)(B)(i)(III)) 

DOE uses the NIA spreadsheet results in 

its consideration of total projected 

energy savings. 

d. Lessening of Utility or Performance of 

Products 

In establishing classes of products, 

and in evaluating design options and 

the impact of potential standard levels, 

DOE sought to develop standards for 

residential clothes washers that would 

not lessen the utility or performance of 

those products. (42 U.S.C. 

6295(o)(2)(B)(i)(IV)) DOE believes that 

the TSLs adopted in today’s direct final 

rule would not reduce the utility or 

performance of the clothes washers 

under consideration in this rulemaking. 

e. Impact of Any Lessening of 

Competition 

EPCA directs DOE to consider any 

lessening of competition that is likely to 

result from standards. It also directs the 

Attorney General of the United States 

(Attorney General) to determine the 

impact, if any, of any lessening of 

competition likely to result from a 

proposed standard and to transmit such 

determination to the Secretary within 60 

days of the publication of a direct final 

rule, together with an analysis of the 

nature and extent of the impact. (42 

U.S.C. 6295(o)(2)(B)(i)(V) and (B)(ii)) 

DOE published a NOPR containing 

energy conservation standards identical 

to those set forth in today’s direct final 

rule and transmitted a copy of today’s 

direct final rule and the accompanying 

TSD to the Attorney General, requesting 

that the Department of Justice (DOJ) 

provide its determination on this issue. 

DOE will consider DOJ’s comments on 

the rule in determining whether to 

proceed with the direct final rule. DOE 

will also publish and respond to DOJ’s 

comments in the Federal Register in a 

separate notice. 

f. Need for National Energy 

Conservation 

The energy savings from new or 

amended 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. 

Energy savings from the proposed 

standards also are likely to result in 

environmental benefits in the form of 

reduced emissions of air pollutants and 

greenhouse gases associated with energy 

production. DOE reports the 

environmental effects from today’s 

standards, and from each TSL it 

considered, in the emissions analysis 

contained in chapter 15 in the direct 

final rule TSD and in section V.B.6 of 

this notice. DOE also reports estimates 

of the economic value of emissions 

reductions resulting from the 

considered TSLs. 

g. Other Factors 

EPCA allows the Secretary of Energy, 

in determining whether a standard is 

economically justified, to consider any 

other factors that the Secretary deems to 

be relevant. (42 U.S.C. 

6295(o)(2)(B)(i)(VII)) In developing this 

direct final rule, DOE has also 

considered the submission of the Joint 

Petition, which DOE believes sets forth 

a statement by interested persons that 

are fairly representative of relevant 

points of view (including 

representatives of manufacturers of 

covered products, States, and efficiency 

advocates) and contains 

recommendations with respect to an 

energy conservation standard that are in 

accordance with 42 U.S.C. 6295(o). DOE 

has encouraged the submission of 


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32326 Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 

17EIA approves the use of the name ‘‘NEMS’’ to 

describe only an AEO version of the model without 

any modification to code or data. Because the 

present analysis entails some minor code 

modifications and runs the model under various 

policy scenarios that deviate from AEO 

assumptions, the name ‘‘NEMS–BT’’ refers to the 

model as used here. (BT stands for DOE’s Building 

Technologies Program.) 

consensus agreements as a way to bring 

diverse interested parties together, to 

develop an independent and probative 

analysis useful in DOE standard setting, 

and to expedite the rulemaking process. 

DOE also believes that standard levels 

recommended in the consensus 

agreement may increase the likelihood 

for regulatory compliance, while 

decreasing the risk of litigation. 

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 effect potential amended 

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.11 of this 

direct final rule and chapter 8 of the 

direct final rule TSD. 

IV. Methodology and Discussion 

DOE used two spreadsheet tools to 

estimate the impact of today’s direct 

final rule. The first spreadsheet 

calculates LCCs and PBPs of potential 

new energy conservation standards. The 

second provides shipments forecasts 

and then calculates impacts of potential 

energy conservation standards on 

national energy savings and net present 

value. The two spreadsheets are 

available online at: http:// 

www1.eere.energy.gov/buildings/ 

appliance_standards/residential/ 

clothes_washers.html. The Department 

also assessed manufacturer impacts, 

largely through use of the Government 

Regulatory Impact Model (GRIM). 

Additionally, DOE estimated the 

impacts on utilities and the 

environment of energy conservation 

standards for residential clothes 

washers. DOE used a version of EIA’s 

National Energy Modeling System 

(NEMS) for the utility and 

environmental analyses. The NEMS 

model simulates the energy sector of the 

U.S. economy. EIA uses NEMS to 

prepare its Annual Energy Outlook, a 

widely known baseline energy forecast 

for the United States. For more 

information on NEMS, refer to The 

National Energy Modeling System: An 

Overview, DOE/EIA–0581 (98) (Feb. 

1998), available at: http:// 

tonto.eia.doe.gov/FTPROOT/ 

forecasting/058198.pdf. 

The version of NEMS used for 

appliance standards analysis, which 

makes minor modifications to the AEO 

version, is called NEMS–BT.17 NEMS– 

BT offers a sophisticated picture of the 

effect of standards, because it accounts 

for the interactions among the various 

energy supply and demand sectors and 

the economy as a whole. 

A. Market and Technology Assessment 

1. General 

When beginning an energy 

conservation standards rulemaking, 

DOE develops information that provides 

an overall picture of the market for the 

products concerned, including the 

purpose of the products, the industry 

structure, and market characteristics. 

This activity includes both quantitative 

and qualitative assessments based 

primarily on publicly available 

information. The subjects addressed in 

the market and technology assessment 

for this rulemaking include products 

covered by the rulemaking, quantities 

and types of products sold and offered 

for sale, retail market trends, product 

classes and manufacturers, regulatory 

and non-regulatory programs, and 

technology options that could improve 

the energy efficiency of the product(s) 

under examination. See chapter 3 of the 

direct final rule TSD for further 

discussion of the market and technology 

assessment. 

2. Products Included in This 

Rulemaking 

This subsection addresses whether 

EPCA covers certain products and 

thereby authorizes DOE to adopt 

standards for those products, and 

whether DOE will consider in this 

rulemaking standards for certain 

products that DOE determined are 

covered under EPCA. 

ASAP questioned whether 

combination washer/dryers are covered 

products in this rulemaking. (ASAP, 

Public Meeting Transcript, No. 7 at p. 

47) ‘‘Clothes washer’’ is defined in 10 

CFR 430.2 to mean a consumer product 

designed to clean clothes using a water 

solution of soap or detergent and 

mechanical agitation or other 

movement. A combination washer/dryer 

meets this definition and also performs 

a drying function. As a result, DOE 

determined that combination washer/ 

dryers are covered products according 

to the existing regulatory definition of 

clothes washer. DOE notes that 

combination washer/dryers are 

currently being testing by certain 

manufacturers according to the DOE 

clothes washer test procedure and that 

certification data is available for such 

products in, among others, the CEC and 

ENERGY STAR product databases. DOE 

also does not have information that 

would indicate that, while operating in 

clothes washer mode, the energy and 

water use of such a machine is 

inherently different from the energy and 

water use of a stand-alone clothes 

washer. 

3. Product Classes 

Existing energy conservation 

standards divide residential clothes 

washers into five product classes based 

on location of access, capacity, and 

features such as suds saving. As 

mentioned previously in section III.A.1 

DOE is not maintaining the top-loading 

semiautomatic and suds-saving product 

classes. DOE is also splitting the frontloading product class into two separate 

product classes based on capacity. Table 

IV–1 presents the product classes set 

forth in 10 CFR 430.32(g) and the 

product classes established in this 

rulemaking. 

TABLE IV–1—CLOTHES WASHER

PRODUCT CLASSES

Product Classes in 

430.32(g) 

Product classes 

established in this 

rulemaking 

i. Top-loading, compact (less than 1.6 

cubic feet capacity).

i. Top-loading, compact (less than 1.6 

cubic feet capacity). 

ii. Top-loading, standard (1.6 cubic feet 

or greater capacity).

ii. Top-loading, standard (1.6 cubic feet 

or greater capacity). 

iii. Top-loading, semiautomatic.iii. Front-loading, 

compact (less than 

1.6 cubic feet capacity). 


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18For more information, visit 

www.energystar.gov. 

19 DOE notes that it included two technology 

options, improved horizontal axis washer drum 

design and reduced thermal mass, in its initial list 

of options, but later determined in its engineering 

analysis that available data did not indicate that 

these technologies improved energy efficiency of 

clothes washers. See section IV.C.1, 

TABLE IV–1—CLOTHES WASHER

PRODUCT CLASSES—Continued 

Product Classes in 

430.32(g) 

Product classes 

established in this 

rulemaking 

iv. Front-loading ........ iv. Front-loading, 

standard (1.6 cubic 

feet or greater capacity). 

v. Suds-saving.

4. Non-Regulatory Programs 

As part of the market and technology 

assessment, DOE reviews non-regulatory 

programs promoting energy efficient 

residential appliances in the United 

States. Non-regulatory programs that 

DOE considers in its market and 

technology assessment include ENERGY 

STAR, a voluntary labeling program 

administered jointly by the U.S. 

Environmental Protection Agency (EPA) 

and DOE. ENERGY STAR identifies 

energy efficient products through a 

qualification process.18 To qualify, a 

product must exceed Federal minimum 

standards by a specified amount, or if 

no Federal standard exists, a product 

must exhibit select energy-saving 

features. ENERGY STAR specifications 

currently exist for residential clothes 

washers. 

5. Technology Options 

As part of the market and technology 

assessment, DOE developed a list of 

technologies to consider for improving 

the efficiency of residential clothes 

washers. Initially, these technologies 

encompassed all those DOE believes 

would improve energy efficiency and 

are technologically feasible. Chapter 3 of 

the direct final rule TSD includes the 

detailed list of all technology options 

identified for residential clothes 

washers.19 DOE received multiple 

comments from interested parties in 

response to the technologies proposed 

for analysis. 

In response to the framework 

document, interested parties suggested 

to DOE various databases from which it 

could obtain relevant product features 

and performance data. ALS 

recommended that DOE examine the 

CEC, FTC, and DOE certification 

databases, as well as the Web sites that 

ALS maintains for its own brands. (ALS, 

No. 13 at p. 2) The California Utilities 

and PG&E noted discrepancies among 

several databases, for instance that not 

all clothes washer models appear in all 

relevant lists, and requested that DOE 

reconcile the differences among them. 

(California Utilities, No. 19 at p. 4) DOE 

collected information to support this 

rulemaking from as many publicly 

available sources as it could identify, 

including trade publications, technical 

reports, manufacturers’ literature, 

product databases, and inputs from 

interested parties. As part of its data 

collection, DOE reviewed all of those 

databases, as well as others that include 

qualifying product lists from ENERGY 

STAR and the CEE. In doing so, DOE 

evaluated product data critical to its 

analysis to ensure that appropriate 

values were being used. 

ASAP, the Joint Comment, and PG&E 

stated that the data collection should 

include more recent data than for 2007. 

According to ASAP, more recent data 

would capture changes in market share 

as well as the effects of manufacturer 

production tax credits. (ASAP, Public 

Meeting Transcript, No. 7 at p. 122; 

Joint Comment, No. 15 at p. 8; PG&E, 

Public Meeting Transcript, No. 7 at p. 

36) DOE attempts to collect the most 

comprehensive and recent data 

available. For today’s direct final rule, 

DOE used AHAM’s residential clothes 

washer data submission, which 

included shipments, shipment-weighted 

efficiency, and market share efficiency 

data through 2008. 

The California Utilities recommended 

that DOE collect data on sales-weighted 

clothes washer capacity, preferably in 

increments of 0.5 cubic feet, because 

they suggest that capacity has a greater 

effect on clothes washer efficiency than 

do other features. The Joint Comment 

also recommended that shipment data 

be disaggregated by capacity in at most 

0.5-cubic-foot increments, and that such 

data should identify fill control type 

(i.e., adaptive water fill control, manual 

fill control, or combination adaptive and 

manual fill control). The Joint Comment 

stated that DOE also should collect 

shipment data for combination washer/ 

dryers. (California Utilities, No. 19 at p. 

4; Joint Comment, No. 15 at pp. 4, 8) 

DOE is unaware of residential clothes 

washer shipments data disaggregated to 

the granularity suggested by the 

California Utilities and the Joint 

Comment. DOE requested that 

interested parties provide such data or 

information on sources to obtain this 

information but received no further 

information. 

B. Screening Analysis 

DOE uses the following four screening 

criteria to determine which technology 

options are suitable for further 

consideration. 

(1) Technological feasibility. DOE will 

consider technologies incorporated in 

commercial products or in working 

prototypes to be technologically 

feasible. (The technological feasibility of 

options was discussed in the preceding 

section as part of the market and 

technology assessment.) 

(2) Practicability to manufacture, 

install, and service. If mass production 

and reliable installation and servicing of 

a technology in commercial products 

could be achieved on the scale 

necessary to serve the relevant market at 

the time the standard comes into effect, 

then DOE will consider that technology 

practicable to manufacture, install, and 

service. 

(3) Adverse impacts on product utility 

or product availability. If DOE 

determines 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 consider this 

technology further. 

(4) Adverse impacts on health or 

safety. If DOE determines that a 

technology will have significant adverse 

impacts on health or safety, it will not 

consider this technology further. 

10 CFR part 430, subpart C, appendix 

A, (4)(a)(4) and (5)(b). 

Technologies that pass through the 

screening analysis are referred to as 

‘‘design options’’ in the engineering 

analysis. Details of the screening 

analysis are provided in chapter 4 of the 

direct final rule TSD. 

In the framework document, DOE 

identified the following initial 

technology options that could improve 

the efficiency of residential clothes 

washers, as shown in Table IV–2. 

TABLE IV–2—INITIAL TECHNOLOGY

OPTIONS FOR RESIDENTIAL CLOTHES

WASHERS

1. Adaptive control systems. 

2. Added insulation. 

3. Advanced agitation concepts for verticalaxis machines. 

4. Automatic fill control. 

5. Bubble action. 

6. Direct-drive motor. 

7. Electrolytic disassociation of water. 

8. Horizontal-axis design. 

9. Horizontal-axis design with recirculation. 

10. Hot water circulation loop. 

11. Improved fill control. 


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32328 Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 

TABLE IV–2—INITIAL TECHNOLOGY

OPTIONS FOR RESIDENTIAL CLOTHES

WASHERS—Continued 

12. Improved horizontal-axis washer drum 

design. 

13. Improved water extraction to lower remaining moisture content. 

14. Increased motor efficiency. 

15. Low-standby-power design. 

16. Ozonated laundering. 

17. Plastic particle cleaning. 

18. Reduced thermal mass. 

19. Silver ion injection. 

20. Spray rinse or similar water-reducing 

rinse technology. 

20. Steam washing. 

21. Thermostatically controlled mixing valves. 

22. Tighter tub tolerance. 

23. Ultrasonic washing. 

DOE received the following specific 

comments with regard to the screening 

analysis for the residential clothes 

washer technology options presented in 

the framework document. 

1. Technologies Requiring Clarification 

or Reclassification 

AHAM, BSH, and GE commented that 

the horizontal-axis, top-loading clothes 

washer described in the framework 

document should be considered as a 

horizontal-axis product regardless of 

loading position. (AHAM, Public 

Meeting Transcript, No. 7 at p. 53; 

AHAM, No. 16 at p. 3; BSH, No. 11 at 

p. 3; GE, No. 20 at p. 1) ALS commented 

that one very small U.S. manufacturer 

has made a horizontal-axis top-loader, 

but it has not been readily accepted by 

consumers. (ALS, No. 13 at p. 2) As 

discussed in section III.A.2, DOE 

maintains product class distinction by 

method of loading for today’s final rule. 

Therefore, DOE considers a horizontalaxis design as a technology to improve 

the efficiency of top-loading clothes 

washers. DOE notes that such products 

are currently on the market in the 

United States. 

Several manufacturers requested 

additional information on some of the 

technology options without further 

comment. AHAM, GE, and Whirlpool 

requested clarification on bubble action, 

electrolytic disassociation of water, and 

improved horizontal-axis washer drum 

design. AHAM and GE stated that they 

sought clarification on increased motor 

efficiency, BSH requested clarification 

on improved horizontal-axis washer 

drum design and tighter tub tolerance, 

and Whirlpool requested clarification 

on the reduced thermal mass technology 

option. ALS stated it would not offer 

comment on electrolytic disassociation 

of water, ozonated laundering, plastic 

particle cleaning, and ultrasonic 

washing until more information was 

available on the technology. (AHAM, 

Public Meeting Transcript, No. 7 at pp. 

52–53; AHAM, No. 16 at p. 3; ALS, No. 

13 at p. 4; BSH, No. 11 at p. 3; GE, No. 

20 at p. 1; Whirlpool, No. 22 at p. 4) 

ASAP asked whether the low standbypower design included both standby 

and off modes. (ASAP, Public Meeting 

Transcript, No. 7 at p. 63) Additional 

detail on each of these technologies is 

provided in chapter 3 of the direct final 

rule TSD. 

DOE requested comment in the 

framework document on whether 

additional technology options should be 

considered. ALS and Whirlpool stated 

that they are unaware of additional 

technologies that should be considered 

in DOE’s preliminary analysis. (ALS, 

No. 13 at p. 5; Whirlpool, No. 22 at p. 

5) AHAM and GE suggested that DOE 

add turbidity sensors to the list of 

technology options considered. 

Whirlpool commented that turbidity 

sensors have not been proven to provide 

adequate stain removal, soil removal, 

and rinsing performance. (AHAM, 

Public Meeting Transcript, No. 7 at p. 

68; AHAM, No. 16 at p. 4; GE, No. 20 

at p. 1; Whirlpool, No. 22 at p. 5) 

Multiple manufacturers stated to DOE 

during interviews that turbidity sensors 

have not been implemented in clothes 

washers largely due to technical barriers 

such as the high foaming properties of 

U.S. laundry detergents. Therefore, DOE 

did not add turbidity sensors as a 

technology option. 

AHAM, GE, Samsung, and SCE stated 

that DOE should evaluate smart gridenabled, demand-responsive clothes 

washers. AHAM and GE identified peak 

load shedding, wherein peak electricity 

demand is reduced via voluntary 

curtailment of clothes washer usage 

during certain times, as an important 

capability of such clothes washers. 

(AHAM, Public Meeting Transcript, No. 

7 at p. 31; AHAM, No. 16 at p. 4; GE, 

Public Meeting Transcript, No. 7 at p. 

31; GE, No. 20 at pp. 1, 3; Samsung, No. 

25 at p. 4; SCE, Public Meeting 

Transcript, No. 7 at pp. 30, 64) DOE is 

unaware at this time of any such clothes 

washers available on the U.S. market for 

evaluation in terms of energy and water 

savings. Therefore, DOE did not 

consider smart-grid or other networkenabled technology options in this 

rulemaking. 

In the framework document, DOE 

tentatively included steam washing in 

the list of residential clothes washer 

technology options. AHAM, GE, and 

Whirlpool noted that steam washing is 

already available in higher price point 

clothes washers. BSH stated that it has 

found through laboratory testing that 

steam washing does not improve 

cleaning performance. (AHAM, No. 16 

at p, 4; BSH, No. 11 at p. 3; GE, No. 20 

at p. 1; Whirlpool, No. 22 at p. 4) DOE 

research and testing indicates that steam 

generation requires significantly more 

energy than the potential energy savings 

associated with using less hot water 

during the wash cycle. Therefore, in the 

final list of technology options, DOE did 

not consider steam washing as a means 

to reducing energy consumption. 

2. Technological Feasibility 

AHAM, BSH, GE, and Whirlpool 

stated that added insulation would 

provide no meaningful energy savings, 

resulting in a minimal impact on MEF. 

BSH also stated that added insulation 

would be an issue for Underwriters 

Laboratories (UL) listing, and that the 

energy savings associated with 

horizontal-axis designs that incorporate 

recirculation may be small. (AHAM, 

Public Meeting Transcript, No. 7 at p. 

52; AHAM, No. 16 at p. 3; BSH, No. 11 

at p. 3; GE, No. 20 at p. 1; Whirlpool, 

No. 22 at p. 3) DOE agrees that the 

energy savings associated with added 

insulation would be negligible, 

particularly as the amount of hot water 

used in clothes washers decreases. DOE 

did not observe insulation around the 

tub in any of the units in its test sample, 

and multiple manufacturers stated that 

there was no energy benefit associated 

with the use of insulation. Therefore, 

DOE screened out added insulation. For 

horizontal-axis design with 

recirculation, DOE observes that units 

incorporating this design are available 

on the market, and one manufacturer 

stated that it can achieve energy savings 

of about 5 percent. Therefore, DOE 

retained horizontal-axis design with 

recirculation for its analysis. 

AHAM, GE, and Whirlpool 

commented that standby power 

accounts for a small percentage of total 

energy consumption—AHAM estimates 

it accounts for 3 percent of annual 

energy use—so that designs 

incorporating low standby power would 

have a minimal impact. (AHAM, Public 

Meeting Transcript, No. 7 at p. 53; 

AHAM, No. 16 at p. 3; GE, No. 20 at p. 

1; Whirlpool, No. 22 at p. 4) DOE 

recognizes that standby power is a 

relatively small percentage of annual 

clothes washer energy consumption. 

Under EPCA, as amended by EISA 2007, 

however, DOE is required to integrate 

standby and off mode energy use into 

the energy efficiency metric if 

technically feasible and consistent with 

42 USC 6295(o). Today’s final rule 

includes amendments to include 

measures for standby and off mode 

power consumption for clothes washers. 


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DOE received additional comments 

from interested parties suggesting that 

DOE exclude certain technologies 

proposed in the framework document 

from further analysis because they 

already are in widespread use. AHAM, 

BSH, GE, and Whirlpool commented 

that adaptive control systems, automatic 

fill control, improved fill control, spray 

rinse or similar water-reducing rinse 

technologies, and thermostatically 

controlled mixing valves are already 

widely used in residential clothes 

washers, although they assumed that 

improved fill control was the same 

technology as adaptive fill controls. 

AHAM, GE, and Whirlpool stated that 

direct-drive motors, horizontal-axis 

designs with recirculation, and hot 

water circulation loops also are widely 

used. AHAM and GE further stated that 

the widespread use of direct-drive 

motors currently applies only to toploaders, although the technology is also 

available for front-loaders. Whirlpool 

added that horizontal-axis design is 

widely used. According to Whirlpool, 

the efficiency gains from these 

technology options are being recognized 

already. AHAM, BSH, and GE further 

commented that reduced thermal mass 

is already in widespread use for 

horizontal-axis clothes washers. AHAM, 

BSH, GE, and Whirlpool also stated that 

current products are nearing the 

maximum possible centrifugal force 

levels, so that no additional energy 

savings could be achieved by improved 

water extraction to lower remaining 

moisture content. (AHAM, Public 

Meeting Transcript, No. 7 at p. 53; 

AHAM, No. 16 at pp. 3–4; BSH, No. 11 

at p. 3; GE, No. 20 at p. 1; Whirlpool, 

No. 22 at pp. 3–4) DOE evaluated each 

of these technologies as part of its 

reverse-engineering and manufacturer 

interviews, and determined that 

baseline clothes washers are available 

that meet current Federal standards 

without the use of such designs, each of 

which represents a potential means to 

improve energy efficiency. DOE does 

not consider level of commercialization 

in itself to be an indicator of whether a 

technology should be screened out. 

Therefore DOE retained all the above 

mentioned technology options for its 

analysis. 

According to Whirlpool, it routinely 

pursues increased motor efficiency in its 

product development. (Whirlpool, No. 

22 at p. 4) Because this technology 

option meets DOE’s screening criteria, it 

was retained for further analysis. 

3. Practicability to Manufacture, Install, 

and Service/Adverse Impacts on 

Product Utility or Availability 

AHAM, BSH, GE, and Whirlpool 

commented that advanced agitation 

concepts already exist in high efficiency 

top-loading residential clothes washers. 

Whirlpool stated that the cost of this 

technology option limits its adoption to 

higher-priced models. (AHAM, No. 16 at 

p. 3; BSH, No. 11 at p. 3; GE, No. 20 at 

p. 1; Whirlpool, No. 22 at p. 3) DOE 

considers costs of the design options 

necessary to achieve each efficiency 

level as part of the LCC and PBP 

analysis. Therefore, DOE retained 

advanced agitation concepts for toploading machines for its analysis. 

For ozonated laundering, AHAM and 

GE commented that they are aware of 

such technology only for expensive 

stand-alone units. According to those 

commenters, it is unclear how ozonated 

laundering could be implemented into 

the more price-conscious residential 

market. (AHAM, Public Meeting 

Transcript, No. 7 at p. 53; AHAM, No. 

16 at p. 3; GE, No. 20 at p. 1) Whirlpool 

stated that ozonated laundering offers 

poor cleaning performance and is quite 

costly. (Whirlpool, No. 22 at p. 4) ASAP, 

AWE, and the Joint Comment noted that 

residential clothes washers using 

ozonated laundry technology currently 

are on the market in Japan. AWE 

specifically mentioned the Sanyo Aqua 

Ozone combination washer/dryer and 

stated that ozone is also used by 

multiple manufacturers for commercial 

laundry. ASAP and the Joint Comment 

stated that ozonated laundry allows 

significant reductions in water and 

energy use. (ASAP, Public Meeting 

Transcript, No. 7 at p. 63; AWE, No. 12 

at p. 2; Joint Comment, No. 15 at p. 4) 

Because no such residential clothes 

washers have been produced or 

demonstrated for the U.S. market, DOE 

does not believe this technology would 

be practicable to manufacture, install, 

and service on the scale necessary to 

serve the U.S. residential clothes washer 

market at the time of the effective date 

of an amended standard. Also, because 

implementation of this technology in a 

residential application is so limited, 

DOE is unable to adequately assess the 

impacts on consumer health or utility. 

For these reasons, DOE screened out 

ozonated laundry. 

AHAM, BSH, GE, and Whirlpool 

stated that plastic particle cleaning does 

not provide effective wash performance. 

BSH added that other concerns include 

the manufacture, maintenance, and 

disposal of the plastic particles. 

(AHAM, Public Meeting Transcript, No. 

7 at p. 54; AHAM, No. 16 at p. 4; BSH, 

No. 11 at p. 3; GE, No. 20 at p. 1; 

Whirlpool, No. 22 at p. 4) Samsung 

commented that plastic particle 

cleaning would have to be evaluated 

with consideration of wash and rinse 

performance. (Samsung, No. 25 at p. 3) 

Though clothes washers using plastic 

particle cleaning exist in working 

prototypes, this technology has not yet 

been commercialized, and thus 

consumer utility has yet to be 

thoroughly evaluated in terms of 

cleaning performance, as well as 

handling of the plastic particles. In 

addition, because no clothes washer 

manufacturer is currently producing 

such a machine, and because the 

reliability and consumer habits 

associated with using plastic particles 

are as yet unknown, DOE believes that 

it would not be practicable to 

manufacture, install, and service this 

technology on the scale necessary to 

serve the relevant market at the time of 

the effective date of an amended 

standard. For these reasons, DOE 

screened out plastic particle cleaning. 

Whirlpool commented that tighter tub 

tolerance can be achieved, but the 

technology option is costly enough to 

limit its adoption to higher price-point 

clothes washers because a stronger 

structure is required. (Whirlpool, No. 22 

at p. 4) Because DOE accounts for the 

cost associated with each design option 

necessary to achieve a certain efficiency 

level, it did not screen out tighter tub 

tolerance on this basis and retained this 

design option for consideration in the 

engineering analysis. 

AHAM, BSH, GE, and Whirlpool 

stated that ultrasonic washing is not a 

proven technology for residential 

clothes washers. Whirlpool further 

stated that this technology has not been 

proven to provide adequate stain 

removal, soil removal, or rinsing 

performance. (AHAM, Public Meeting 

Transcript, No. 7 at p. 54; AHAM, No. 

16 at p. 4; BSH, No. 11 at p. 3; GE, No. 

20 at p. 1; Whirlpool, No. 22 at p. 4) 

DOE’s research supports these 

comments, indicating that ultrasonic 

washing has not been shown to remove 

soil from clothes adequately. In 

addition, bubble cavitations caused by 

standing ultrasonic waves potentially 

could damage fragile clothing or 

clothing fasteners, further reducing 

product utility. For these reasons, DOE 

screened out ultrasonic washing. 

DOE understands that bubble action 

has been incorporated into 

commercially available residential 

clothes washers in Europe and Asia. 

Because production is nonexistent in 

the U.S., however, DOE does not believe 

that this technology would be 

practicable to manufacture, install, and 


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service on the scale necessary to serve 

the residential market at compliance 

date of new standards. For these 

reasons, DOE screened out bubble 

action. 

4. Adverse Impacts on Health or Safety 

ALS stated that it was not aware of 

any technologies that should be 

removed from consideration due to 

safety concerns. (ALS, No. 13 at p. 4) 

ASAP and the Joint Comment stated 

that DOE should retain silver ion 

injection because it provides a 

deodorizing action in cold water 

washing and currently is available in 

the U.S. residential clothes washer 

market. According to the Joint 

Comment, such technology may 

encourage consumers to use fewer warm 

and hot water cycles. (ASAP, Public 

Meeting Transcript, No. 7 at p. 63; Joint 

Comment, No. 15 at p. 4) Whirlpool 

acknowledged that some manufacturers 

have incorporated silver ion technology 

as a means of disinfection, but stated 

that silver has an adverse impact on the 

environment. Whirlpool commented 

that the U.S. EPA requires that silver 

used for such a purpose be reported and 

tracked under the Federal Insecticide, 

Fungicide, and Rodenticide Act. 

(Whirlpool, No. 22 at p. 5) The EPA 

reporting requirement for clothes 

washers incorporating silver does not 

prevent commercialization of such 

technology, and DOE is not aware that 

any adverse impacts on health or safety 

have been demonstrated for this 

technology. Therefore DOE retained this 

option for consideration in the 

engineering analysis. 

5. Additional Screening Criteria 

DOE received a number of comments 

from interested parties recommending 

that it use additional criteria for 

screening technology options besides 

the four listed in 10 CFR part 430, 

subpart C, appendix A at 4(a)(4). 

AHAM, BSH, GE, and Whirlpool 

commented that technology options also 

should be evaluated on the basis of 

wash performance, rinse performance, 

and fabric care (damage, fraying, etc.). 

(AHAM, No. 16 at p. 4; BSH, No. 11 at 

p. 3; GE, No. 20 at p. 1; Whirlpool, No. 

22 at p. 5) Miele, Inc. (Miele) questioned 

whether DOE would be evaluating each 

technology option on the basis of 

adequate wash performance. (Miele, 

Public Meeting Transcript, No. 7 at p. 

65) For this rulemaking, DOE used the 

screening criteria set forth in its 

regulations. Technologies are evaluated 

in the screening analysis to determine 

whether they have an adverse impact on 

product utility or availability. Because 

DOE believes that the general utility of 

a clothes washer includes the ability to 

clean clothing adequately, DOE 

screened out those technologies that it 

believes have not been demonstrated to 

achieve adequate cleaning (i.e., 

ultrasonic washing, as discussed 

previously). 

Based on comments received 

regarding the initial technology options, 

DOE retained the design options shown 

in Table IV–3 for its subsequent 

engineering analysis. These remaining 

design options met all of the screening 

criteria listed above. 

TABLE IV–3—DESIGN OPTIONS

RETAINED FOR ENGINEERING ANALYSIS

1. Adaptive control systems. 

2. Advanced agitation concepts for top-loading machines. 

3. Automatic water fill control. 

4. Direct-drive motor. 

5. Horizontal-axis design. 

6. Horizontal-axis design with recirculation. 

7. Hot water circulation loop. 

8. Improved fill control. 

9. Improved horizontal-axis washer drum design. 

10. Improved water extraction to lower remaining moisture content. 

11. Increased motor efficiency. 

12. Low-standby-power electronic controls. 

13. Reduced thermal mass. 

14. Silver ion injection. 

15. Spray rinse or similar water-reducing 

rinse technology. 

16. Thermostatically controlled mixing valves. 

17. Tighter tub tolerance. 

C. Engineering Analysis 

In the engineering analysis, DOE 

evaluates a range of product efficiency 

levels and their associated 

manufacturing costs. The purpose of the 

analysis is to estimate the incremental 

manufacturer production costs (MPCs) 

associated with increasing efficiency 

levels above that of the baseline model 

in each product class. The engineering 

analysis considers technologies not 

eliminated in the screening analysis, 

although certain technologies are not 

analyzed if data does not exist to 

evaluate the energy efficiency 

characteristics of the technology; 

available data suggest that the efficiency 

benefits of the technology are negligible; 

or for reasons stated in the March 2012 

TP final rule, DOE did not amend the 

test procedure to measure the energy 

impact of these technologies. DOE 

considers the remaining technologies, 

designated as design options, in 

developing cost-efficiency curves, 

which subsequently are used for the 

LCC and PBP analyses. 

DOE has identified the following 

three methodologies for generating the 

manufacturing costs needed for the 

engineering analysis: (1) The designoption approach, which provides the 

incremental costs of adding to a baseline 

model design options that will improve 

its efficiency; (2) the efficiency-level 

approach, which provides the relative 

costs of achieving increases in energy 

efficiency levels, without regard to the 

particular design options used to 

achieve such increases; and (3) the costassessment (or reverse-engineering) 

approach, which provides ‘‘bottom-up’’ 

manufacturing cost assessments for 

achieving various levels of increased 

efficiency, based on detailed data 

regarding costs for parts and material, 

labor, shipping/packaging, and 

investment for models that operate at 

particular efficiency levels. 

DOE conducted the engineering 

analyses for the top-loading standard 

and front-loading standard product 

classes using a combination of the costassessment approach and the efficiencylevel approach. The cost-assessment 

approach provides an accurate means 

for estimating a single manufacturer’s 

incremental manufacturing costs for 

achieving various levels of increased 

efficiency. This approach involved 

physically disassembling commercially 

available products to develop costefficiency relationships for each 

manufacturer’s product lines. Because 

each manufacturer may choose a 

different path to achieve higher levels of 

efficiency, an efficiency-level approach 

produces an industry-wide costefficiency relationship for each product 

class. DOE developed cost-efficiency 

relationships for the top-loading 

standard and front-loading standard 

product classes by calculating the 

market-weighted average of the 

individual cost-efficiency relationships 

it developed for each manufacturer. 

Because less data was available for the 

top-loading compact and front-loading 

compact product classes, DOE used the 

design-option approach to develop the 

cost-efficiency relationships for these 

product classes. For the top-loading 

compact product class, DOE developed 

the cost-efficiency relationship by 

estimating the incremental costs of 

adding specific design options to a 

baseline model that would provide 

sufficient improvement in efficiency to 

achieve the higher efficiency levels 

considered for the analysis. For the 

front-loading compact product class, 

DOE estimated the efficiency of a 

baseline product by extrapolating the 

rated efficiencies of front-loading 

clothes washers with capacities nearing 

those that delineate the compact 

product class (i.e., 1.6 to 3.0 cubic feet). 

DOE then estimated the incremental 

cost of adding specific design options to 


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20AHAM and AS/NZS standards are available 

online at http://webstore.ansi.org/. 

this baseline model that would improve 

its efficiency enough to achieve the 

higher efficiency level considered for 

the analysis. 

The efficiency levels that DOE 

considered in the engineering analysis 

are attainable using technologies 

currently available on the market for 

residential clothes washers. In addition, 

to provide interested parties with 

additional information about DOE’s 

assumptions and results and the ability 

to perform independent analyses for 

verification, DOE associated each 

efficiency level with specific 

technologies that manufacturers might 

use. Chapter 5 of the direct final rule 

TSD describes the methodology and 

results of the efficiency level analysis 

used to derive the cost-efficiency 

relationships. 

AHAM, ALS, GE, Samsung, and 

Whirlpool commented that they support 

the use of an efficiency-level approach 

for the analysis. (AHAM, Public Meeting 

Transcript, No. 7 at p. 81; AHAM, No. 

16 at p. 5; ALS, No. 13 at p. 9; GE, No. 

20 at p. 1; Samsung, No. 25 at p. 4; 

Whirlpool, No. 22 at p. 6) The Joint 

Comment stated that it supports a 

design-option approach, with the most 

significant design options evaluated 

separately rather than aggregated with 

other measures to help ensure 

transparency of the analysis. (Joint 

Comment, No. 15 at p. 5) The California 

Utilities stated that DOE should give 

greater weight to its reverse-engineering 

approach to isolate the cost premium of 

features on higher-efficiency clothes 

washers that may not contribute to or 

may even adversely affect efficiency. 

(California Utilities, No. 19 at p. 4) As 

discussed earlier, and as described in 

further detail in chapter 5 of the direct 

final rule TSD, DOE used a combination 

of these approaches, as appropriate, to 

develop the cost-efficiency relationships 

for each product class. The costefficiency relationships for each product 

class reflect only those design options 

that enable higher efficiencies, and 

exclude other non-efficiency related 

features that may contribute additional 

cost to higher-efficiency products. 

Details of the features and technologies 

associated with each efficiency level are 

also provided in chapter 5. 

1. Other Technologies Not Analyzed 

In performing the engineering 

analysis, DOE did not consider certain 

technologies that could not 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 suggested 

that the efficiency benefits of the 

technology would be negligible; and (3) 

for the reasons stated in the March 2012 

TP final rule, DOE did not amend the 

test procedure to measure the energy 

impact of these technologies. In its final 

analysis, DOE did not include the 

following design options: 

a. Adaptive Control Systems 

In the September 2010 TP NOPR, DOE 

stated that it was aware of multiple 

clothes washer models available on the 

market that use adaptive control 

technologies to respond to measured or 

inferred load size and fabric mix. 

However, as described in the August 

2011 TP SNOPR, these models have 

since been discontinued, and DOE is 

unaware of any other residential clothes 

washers currently on the market offering 

adaptive controls other than adaptive 

fill control. Adaptive controls could 

allow a clothes washer to sense the 

fabric mix and soil level of a wash load, 

for example, and then adjust wash 

parameters such as the number of 

rinses, cycle time, and water 

temperatures accordingly. DOE is aware 

that many dishwashers incorporate 

adaptive controls by means of a 

turbidity sensor that adjusts the number 

and duration of wash and rinse cycles. 

The dishwasher test procedure accounts 

for this feature through the use of soiled 

dishware loads. 10 CFR part 430, 

subpart B, appendix C. 

DOE is aware of other industry and 

international clothes washer test 

procedures that use a soiled wash load 

to determine wash performance, 

including AHAM HLW–1, ‘‘Performance 

Evaluation Procedures for Household 

Clothes Washers’’; IEC 60456, ‘‘Clothes 

washing machines for household use– 

Methods for measuring the 

performance’’; and Standards Australia/ 

Standards New Zealand (AS/NZS) 

2040.1, ‘‘Performance of household 

electrical appliances–Clothes washing 

machines–Methods for measuring 

performance, energy and water 

consumption.’’ 20 Because of the lack of 

commercially available clothes washers 

with adaptive features, however, DOE 

did not amend the test procedure in the 

March 2012 TP final rule to include 

provisions for measuring the energy 

consumption of clothes washers offering 

adaptive controls other than adaptive 

fill control. For these reasons, DOE did 

not include adaptive controls in its 

engineering analysis. 

b. Improved Horizontal-Axis Washer 

Drum Design 

Although several manufacturers have 

claimed improved wash performance 

and greater utility from improved drum 

designs for front-loading clothes 

washers, DOE is unaware of any 

publicly available data to corroborate a 

decrease in cycle time or water 

consumption or an increase in energy 

efficiency as a result of implementing 

this design option in residential clothes 

washers. Therefore, DOE did not 

include this design option in its 

analysis. 

c. Reduced Thermal Mass 

Reduced thermal mass describes 

minimizing the amount of energy 

consumed by heating the wash tub to 

the temperature of the wash water. DOE 

research suggests that manufacturers 

typically already use tubs with low 

thermal mass for all clothes washers and 

that there is no practicable way to 

manufacture clothes washers with 

significantly lower thermal mass beyond 

the current practice. DOE is unaware of 

any data available regarding efficiency 

improvements related to further 

decreasing the thermal mass of wash 

tubs, and therefore did not consider this 

technology in its analysis. 

d. Silver Ion Injection 

Silver ion injection provides an 

alternative to the traditional method of 

sanitizing clothes using a hot water 

wash. Silver ion injection works by 

electrolyzing pure silver during the 

wash and rinse cycles, and releasing the 

ions into the wash basket to sanitize the 

basket and wash load. While this 

technology option appears to offer an 

efficiency improvement by eliminating 

the need for high wash water 

temperatures, the current DOE test 

procedure does not capture this 

efficiency gain. Additionally, DOE lacks 

data on the reduction in warm and hot 

water cycles associated with silver ion 

injection and is not aware of any test 

procedures that could be used to 

measure any energy savings resulting 

from the use of silver ion injection. 

Because of this, DOE was unable to 

consider silver ion injection for further 

analysis. 

e. Tighter Tub Tolerance 

The tighter tub tolerance technology 

option reduces the annular volume 

between the inner wash basket and the 

outer tub and hence reduces the total 

amount of water required for a fill cycle. 

As a result of discussions with 

manufacturers, DOE believes that this 

technology option has reached its limit 

for efficiency gains. Decreasing the 

space between the wash basket and the 

tub any further could create problems 

such as ‘‘suds lock,’’ whereby suds 

remain between the wash basket and 


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tub; improper draining during the spin 

cycle; noise; and vibration, thereby 

negatively impacting product utility. 

Therefore, DOE did not consider this 

design option in its engineering 

analysis. 

Table IV–4 shows the final list of 

design options that DOE retained for the 

engineering analysis. 

TABLE IV–4—RETAINED DESIGN OPTIONS FOR RESIDENTIAL CLOTHES

WASHERS

1. Advanced agitation concepts for top-loading machines. 

2. Automatic water fill control. 

3. Direct-drive motor. 

4. Horizontal-axis design. 

5. Horizontal-axis design with recirculation. 

6. Hot water circulation loop. 

7. Improved fill control. 

8. Improved water extraction to lower remaining moisture content. 

9. Increased motor efficiency. 

10. Low-standby-power electronic controls. 

11. Spray rinse or similar water-reducing 

rinse technology. 

12. Thermostatically controlled mixing valves. 

2. Baseline Efficiency Levels 

In the framework document, DOE 

proposed baseline efficiency levels in 

active mode for top-loading standard, 

top-loading compact, and front-loading 

clothes washers. DOE did not consider 

front-loading compact models in the 

framework document. The Joint 

Petition, however, proposed standard 

levels for a front-loading compact 

product classes. In today’s final rule, 

DOE defined baseline efficiency levels 

and higher efficiency levels for each of 

the four product classes to conduct its 

engineering analyses. DOE defined a 

baseline efficiency level of 1.60 MEF/8.5 

WF for the front-loading compact 

product class, as well as an updated 

baseline efficiency level of 0.77 MEF/ 

14.0 WF for the top-loading compact 

product class. Chapter 5 of the direct 

final rule TSD provides further details 

on the development of these baseline 

efficiency levels. 

In the framework document, DOE 

based the baseline level for top-loading 

standard units on the MEF specified by 

current Federal energy conservation 

standards and the water factor (WF) 

requirement established by EISA 2007, 

which became effective for residential 

clothes washers manufactured on or 

after January 1, 2011. The top-loading 

compact MEF similarly was based on 

existing standards, with the WF scaled 

from the top-loading standard-size value 

by the ratio of MEFs for the two product 

classes. Because DOE understands that 

all commercially available front-loading 

clothes washers have efficiencies that 

meet or exceed the existing Federal 

standards and the former ENERGY 

STAR level of 1.72 MEF and 8.0 WF, 

effective prior to July 2009, DOE applied 

the former ENERGY STAR level to 

characterize the baseline unit efficiency 

for front-loading clothes washers. 

AHAM, ALS, and BSH stated that 

they support the proposed baseline 

efficiency levels for top-loading 

standard (1.26 MEF/9.5 WF), toploading compact (0.65 MEF/18.4 WF), 

and front-loading standard (1.72 MEF/ 

8.0 WF) product classes. (AHAM, Public 

Meeting Transcript, No. 7 at p. 72; 

AHAM, No. 24 at p. 2; ALS, Public 

Meeting Transcript, No. 7 at p. 73; ALS, 

No. 13 at p. 5; BSH, No. 11 at p. 4) 

Whirlpool commented that it supports 

the proposed baseline efficiency levels 

for the top-loading standard and frontloading standard product classes. 

(Whirlpool, No. 22 at p. 5) The Joint 

Comment stated that DOE should 

determine the WF of baseline toploading compact clothes washers 

through sampling rather than by scaling 

the standard-size baseline value. (Joint 

Comment, No. 15 at p. 5) For the direct 

final rule analysis, DOE defined the 

baseline efficiency levels for the 

standard product classes, both top-and 

front-loading, as they were defined in 

the framework document. DOE defined 

the baseline efficiency level of 0.77 

MEF/14.0 WF for the top-loading 

compact product class based on a 

survey of products currently available 

on the market. This baseline represents 

an improvement over the 0.65 MEF/18.4 

WF baseline defined in the framework 

document. 

Samsung stated that because it does 

not support separate classes based on 

washer axis, it recommends a single 

baseline efficiency level. (Samsung, No. 

25 at p. 4) For the reasons discussed in 

III.A.2 DOE has retained separate 

product classes based on method of 

access and capacity, and thus continued 

to use separate baseline efficiency levels 

for each product class. 

BSH suggested including a frontloading compact product class, with a 

baseline efficiency level of 1.63 MEF/8.5 

WF, based on data from the CEC 

residential clothes washer product 

database. (BSH, No. 11 at p. 4) The Joint 

Petition also included a front-loading 

compact product class. DOE defined a 

baseline efficiency level of 1.60 MEF/8.5 

WF for the front-loading compact 

product class, based on an extrapolation 

of the rated efficiencies of front-loading 

clothes washers with capacities nearing 

those that delineate the compact 

product class (i.e., 1.6 to 3.0 cubic feet). 

Chapter 5 of the direct final rule TSD 

provides further details of on the 

development of the baseline efficiency 

level for the front-loading compact 

product class. 

AHAM, ALS, GE, and Samsung stated 

that no baseline efficiency levels need to 

be defined for top-loading semiautomatic and suds-saving product 

classes, since these product classes 

should be eliminated. (AHAM, No. 16 at 

p. 4; ALS, No. 13 at p. 5; GE, No. 20 at 

p. 1; Samsung, No. 25 at p. 4) Because 

DOE eliminated the top-loading semiautomatic and suds-saving product 

classes, DOE did not define 

corresponding baseline efficiency levels. 

3. Higher Efficiency Levels 

a. Efficiency Levels Proposed in 

Framework Document 

In the framework document, DOE 

considered efficiency levels higher than 

baseline levels based on specifications 

prescribed by ENERGY STAR and CEE’s 

Super-Efficient Home-Appliances 

Initiative. The highest efficiency levels 

were defined by the maximum available 

technology that DOE could identify on 

the market. Where the increments 

between adjacent efficiency levels were 

large, DOE proposed to add an 

intermediate ‘‘gap-fill’’ level. Table IV– 

5 through Table IV–7 show the 

efficiency levels proposed in the 

framework document, based on MEF 

and WF. 

TABLE IV–5—EFFICIENCY LEVELS PROPOSED IN THE FRAMEWORK DOCUMENT FOR TOP-LOADING STANDARD RESIDENTIAL

CLOTHES WASHER FRAMEWORK DOCUMENT

Level Efficiency level description 

Efficiency level 

MEF 

(ft3/kWh/ 

cycle) 

WF 

(gal/cycle/ 

ft3) 

Baseline .......................................................... DOE Standard .................................................................................... 1.26 9.50 


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TABLE IV–5—EFFICIENCY LEVELS PROPOSED IN THE FRAMEWORK DOCUMENT FOR TOP-LOADING STANDARD RESIDENTIAL

CLOTHES WASHER FRAMEWORK DOCUMENT—Continued 

Level Efficiency level description 

Efficiency level 

MEF 

(ft3/kWh/ 

cycle) 

WF 

(gal/cycle/ 

ft3) 

1 ...................................................................... Gap Fill ............................................................................................... 1.40 9.50 

2 ...................................................................... Former ENERGY STAR (pre-July 2009) ........................................... 1.72 8.00 

3 ...................................................................... Former ENERGY STAR (pre-Jan 2011), also CEE Tier 1 ................ 1.80 7.50 

4 ...................................................................... Current ENERGY STAR (Jan 2011), also CEE Tier 2 ...................... 2.00 6.00 

5 ...................................................................... Max Available ..................................................................................... 2.26 4.48 

TABLE IV–6—EFFICIENCY LEVELS PROPOSED IN THE FRAMEWORK DOCUMENT FOR TOP-LOADING COMPACT RESIDENTIAL

CLOTHES WASHER FRAMEWORK DOCUMENT

Level Efficiency level description 

Efficiency level 

MEF 

(ft3/kWh/ 

cycle) 

WF 

(gal/cycle/ 

ft3) 

Baseline .......................................................... DOE Standard .................................................................................... 0.65 18.40 

1 ...................................................................... Max Available ..................................................................................... 0.78 13.90 

TABLE IV–7—EFFICIENCY LEVELS PROPOSED IN THE FRAMEWORK DOCUMENT FOR FRONT-LOADING RESIDENTIAL

CLOTHES WASHER FRAMEWORK DOCUMENT

Level Efficiency level description 

Efficiency level 

MEF 

(ft3/kWh/ 

cycle) 

WF 

(gal/cycle/ 

ft3) 

Baseline .......................................................... Former ENERGY STAR (pre-July 2009) ........................................... 1.72 8.00 

1 ...................................................................... Former ENERGY STAR (pre-Jan 2011), also CEE Tier 1 ................ 1.80 7.50 

2 ...................................................................... Current ENERGY STAR (Jan 2011), also CEE Tier 2) ..................... 2.00 6.00 

3 ...................................................................... CEE Tier 3 .......................................................................................... 2.20 4.50 

4 ...................................................................... Gap Fill ............................................................................................... 2.40 4.20 

5 ...................................................................... Max Available ..................................................................................... 2.89 3.36 

DOE received a number of comments 

on the efficiency levels and provides 

responses to those comments and 

changes made to the efficiency levels for 

today’s direct final rule in the 

paragraphs that follow. The efficiency 

levels analyzed for today’s final rule are 

set forth in section IV.C.3.b (Table IV– 

8 through Table IV–11). 

Whirlpool stated that it supports the 

efficiency levels proposed in the 

framework document. (Whirlpool, No. 

22 at p. 6) PG&E asked how DOE will 

prioritize MEF and WF when 

determining efficiency levels. As noted 

previously, efficiency levels were based 

primarily on levels defined by the 

ENERGY STAR and CEE voluntary 

programs. DOE subsequently added gapfill levels based on data for available 

products, selecting combinations of 

MEF and WF that were achieved by a 

significant number of existing clothes 

washers and that also reasonably 

spanned the incremental changes in 

both metrics between the next-lowest 

and next-highest efficiency levels. 

BSH proposed one additional 

efficiency level for a newly created 

front-loading compact product class 

above the baseline efficiency level it 

proposed—2.31 MEF/4.4 WF. BSH 

identified this as the maximum 

available technology level. (BSH, No. 11 

at p. 6) The Consensus Agreement 

submitted by the Joint Petitioners 

includes efficiency standards for frontloading compact clothes washers of 1.72 

MEF and 8.0 WF. As described 

previously, DOE defined a baseline 

efficiency level of 1.60 MEF and 8.5 WF 

for the front-loading compact product 

class. DOE defined one additional 

efficiency level at 1.72 MEF and 8.0 WF 

based on the standard level proposed in 

the Consensus Agreement. 

ASAP, Earthjustice, and the Joint 

Comment stated that DOE should 

modify its proposed efficiency levels to 

harmonize them for standard-capacity 

top-loaders and front-loaders. In 

particular, those interested parties 

stated that DOE should set the highest 

efficiency level for the top-loading 

standard product class to CEE’s Tier 3 

level. (ASAP, Public Meeting 

Transcript, No. 7 at p. 87–88; 

Earthjustice, No. 17 at p. 7; Joint 

Comment, No. 15 at p. 5) The CEE Tier 

3 level is 2.20 MEF/4.5 WF, which is 

slightly less stringent in MEF but 

slightly more stringent in WF than the 

maximum technologically feasible level 

for this product class identified in the 

framework document, 2.26 MEF/4.48 

WF. Under EPCA, DOE is required to 

analyze the max-tech level for each 

product class. (42 U.S.C. 6295(o)(2)) In 

the framework document, DOE based its 

max-tech level for top-loading standard 

residential clothes washers on the 

maximum performance of products 

available on the market in the United 

States at that time. Since publication of 

the framework document, DOE became 

aware of a new max-tech unit on the 

market rated at 2.47 MEF and 3.6 WF. 

Therefore, in the direct final rule 

analysis, DOE created a new max-tech 

efficiency level corresponding to these 

efficiency ratings. 


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32334 Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 

AHAM and ASAP questioned the gapfill level identified as Efficiency Level 4 

for front-loading clothes washers. ASAP 

recommended that Efficiency Level 4 be 

specified as having a WF of 4.0 rather 

than the value of 4.2 proposed in the 

framework document. (AHAM, Public 

Meeting Transcript, No. 7 at p. 89; 

ASAP, Public Meeting Transcript, No. 7 

at p. 89) DOE proposed Efficiency Level 

4 for front-loading clothes washers— 

2.40 MEF/4.20 WF—based on 

performance metrics represented in a 

number of models in the CEC and 

ENERGY STAR databases. Therefore, 

DOE retained Efficiency Level 4 at a WF 

of 4.2. 

In addition, DOE’s reverse 

engineering suggested that an additional 

gap-fill level between Efficiency Level 4 

(gap-fill) and Efficiency Level 5 (max 

available) was warranted (see chapter 5 

of the direct final rule TSD for more 

information). Based on a review of 

available products, DOE defined a 

second gap-fill level at 2.60 MEF/3.8 

WF. DOE notes a small incremental 

span in WF between ASAP’s proposed 

Efficiency Level 4 (4.0 WF) and DOE’s 

additional gap-fill level (3.8 WF). DOE 

found no meaningful differences in 

technology options required to achieve 

either water consumption level. 

Therefore, DOE retained a WF of 3.8 for 

the additional gap-fill level. 

b. Efficiency Levels Used in Final 

Analysis 

Table IV–8 through Table IV–11 show 

the efficiency levels used in the final 

analysis according to the test procedure 

in appendix J1 as well as the revised test 

procedure in appendix J2. 

TABLE IV–8—EFFICIENCY LEVELS FOR TOP-LOADING STANDARD RESIDENTIAL CLOTHES WASHER FINAL ANALYSIS

Level Efficiency level description 

Efficiency level—appendix 

J1 

Integrated efficiency 

level—appendix J2 

MEF 

(ft3/kWh/ 

cycle) 

WF 

(gal/cycle/ 

ft3) 

IMEF 

(ft3/kWh/ 

cycle) 

IWF 

(gal/cycle/ 

ft3) 

Baseline ....................................... DOE Standard + 0 W Standby .............................. 1.26 9.5 0.84 9.9 

1 ................................................... Gap Fill + 0 W Standby ......................................... 1.40 9.5 0.98 9.9 

2 ................................................... Former ENERGY STAR (pre-2009) + 0 W Standby [Consensus Agreement 2015].1.72 8.0 1.29 8.4 

3 * ................................................. Former ENERGY STAR (pre-2011) + 2.3 W 

Standby.

1.80 7.5 1.34 7.9 

5 ................................................... Former ENERGY STAR (pre-2011) + 0.08 W 

Standby.

1.80 7.5 1.37 7.9 

6 ................................................... Current ENERGY STAR (Jan 2011) + 0.08 W 

Standby [Consensus Agreement 2018].

2.00 6.0 1.57 6.5 

7 ................................................... Max Available (at time of Framework Document) 

+ 0.08 W Standby.

2.26 4.5 1.83 5.0 

8 ................................................... Current Max Available + 0.08 W Standby ............. 2.47 3.6 2.04 4.1 

* DOE also analyzed design options that would meet an efficiency level 4, represented by ‘‘Former ENERGY STAR (pre-2011) + 1.7 W Standby’’; however, this efficiency level has the same IMEF and IWF as the efficiency level represented by Former ENERGY STAR (pre-2011) + 2.3 

W Standby and is therefore not included in the table. 

TABLE IV–9—EFFICIENCY LEVELS FOR FRONT-LOADING STANDARD RESIDENTIAL CLOTHES WASHER FINAL ANALYSIS

Level Efficiency level description 

Efficiency level—appendix 

J1 

Integrated efficiency 

level—appendix J2 

MEF (ft3/ 

kWh/cycle) 

WF (gal/ 

cycle/ft3) 

IMEF (ft3/ 

kWh/cycle) 

IWF (gal/ 

cycle/ft3) 

Baseline ....................................... Former ENERGY STAR (pre-2009) + 2.3 W 

Standby.

1.72 8.0 1.37 8.3 

1 ................................................... Former ENERGY STAR (pre-2009) + 1.7 W 

Standby.

1.72 8.0 1.39 8.3 

2 ................................................... Former ENERGY STAR (pre-2009) + 0.08 W 

Standby.

1.72 8.0 1.41 8.3 

3 ................................................... Former ENERGY STAR (pre-2011) + 0.08 W 

Standby.

1.80 7.5 1.49 7.8 

4 ................................................... Current ENERGY STAR (Jan 2011) + 0.08 W 

Standby.

2.00 6.0 1.66 6.3 

5 ................................................... CEE Tier 3 + 0.08 W Standby [Consensus 

Agreement 2015].

2.20 4.5 1.84 4.7 

6 ................................................... Gap Fill + 0.08 W Standby .................................... 2.40 4.2 2.02 4.4 

7 ................................................... Gap Fill + 0.08 W Standby .................................... 2.60 3.8 2.20 4.0 

8 ................................................... Max Available + 0.08 W Standby .......................... 2.89 3.2 2.46 3.4 


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TABLE IV–10—EFFICIENCY LEVELS FOR TOP-LOADING COMPACT RESIDENTIAL CLOTHES WASHER FINAL ANALYSIS

Level Efficiency level description 

Efficiency level—appendix 

J1 

Integrated efficiency 

level—appendix J2 

MEF (ft3/ 

kWh/cycle) 

WF (gal/ 

cycle/ft3) 

IMEF (ft3/ 

kWh/cycle) 

IWF (gal/ 

cycle/ft3) 

Baseline ....................................... Baseline product on the market ............................ 0.77 14.0 0.59 14.4 

1 ................................................... Consensus Agreement (2015 Proposed Standard).1.26 14.0 0.86 14.4 

2 ................................................... Consensus Agreement (2018 Proposed Standard).1.81 11.6 1.15 12.0 

TABLE IV–11—EFFICIENCY LEVELS FOR FRONT-LOADING COMPACT RESIDENTIAL CLOTHES WASHER FINAL ANALYSIS

Level Efficiency level description 

Efficiency level—appendix 

J1 

Integrated efficiency 

Level—appendix J2 

MEF (ft3/ 

kWh/cycle) 

WF (gal/ 

cycle/ft3) 

IMEF (ft3/ 

kWh/cycle) 

IWF (gal/ 

cycle/ft3) 

Baseline ....................................... DOE-estimated baseline level ............................... 1.60 8.5 1.03 8.8 

1 ................................................... Consensus Agreement (2015 Proposed Standard).1.72 8.0 1.13 8.3 

As discussed in III.B, DOE recently 

published a revised test procedure, 

designated appendix J2, use of which 

will be required as of the compliance 

date of the 2015 standard in this direct 

final rule, absent adverse comment that 

results in withdrawal of today’s direct 

final rule pursuant to 42 U.S.C. 

6295(p)(4). 77 FR 13888. The revised 

test procedure establishes an IMEF 

metric that incorporates energy use in 

standby and off mode, and an IWF 

metric that incorporates water usage 

from all cycles included in the energy 

test cycle. 

DOE included the impacts of new 

provisions in the amended test 

procedure in developing the IMEF/IWF 

efficiency levels in today’s DFR. To 

perform this translation, DOE tested a 

wide range of both top-loading and 

front-loading clothes washers according 

to the test procedure at appendix J1 and 

the revised test procedure at appendix 

J2. Based on these tests, DOE developed 

correlation curves relating MEF to IMEF 

and WF to IWF. Chapter 5 of the direct 

final rule TSD provides additional detail 

on the method DOE used to convert 

from MEF/WF levels to IMEF/IWF 

levels. 

Because the revised standards for 

residential clothes washers are required 

by EPCA to incorporate standby mode 

and off mode energy use (42 U.S.C. 

6295(gg)(3)), DOE created efficiency 

levels for the top-loading standard and 

front-loading standard product classes 

that incorporate reduced standby power 

options into the MEF efficiency levels 

where DOE determined them to be most 

cost effective. In residential clothes 

washers, only units with electronic 

controls consume standby power; units 

with electromechanical controls 

consume no standby or off-mode power. 

For the top-loading standard product 

class, standby power is likely to be 

added at Efficiency Level 3 in Table IV– 

8. This corresponds to the efficiency 

level at which electronic controls would 

be required. Because reduced standby 

power design options are more costeffective than most other available 

design options, they are likely to be one 

of the first design options used by 

manufacturers to achieve higher IMEF 

ratings in units above Efficiency Level 3. 

DOE identified three distinct standby 

power design options, which are 

incorporated at Efficiency Level 3, 

Efficiency Level 4, and Efficiency Level 

5. Efficiency Levels 6–8 incorporate the 

standby design option in Efficiency 

Level 5, which has the lowest energy 

use. 

For the front-loading standard 

product class, DOE is unaware of any 

units that do not use electronic controls. 

Therefore, standby power is 

experienced at all efficiency levels. As 

with top-loading clothes washers, 

reduced standby power design options 

are more cost-effective than most other 

available design options, and they are 

likely to be one of the first design 

options used by manufacturers to 

achieve higher IMEF ratings in units 

above the baseline level. Therefore, as 

shown in Table IV–9, DOE incorporated 

the three distinct standby power design 

options at the Baseline Level, Efficiency 

Level 1, and Efficiency Level 2. 

Efficiency Levels 3–8 incorporate the 

standby design option in Efficiency 

Level 2, which has the lowest energy 

use. 

Chapter 5 of the direct final rule TSD 

provides detailed descriptions of the 

design options associated with each 

efficiency level, including details of the 

active mode and standby mode 

efficiency levels for each product class. 

For the front-loading standard 

product class, DOE introduced a second 

gap fill level in the final analysis at 2.6 

MEF/3.8 WF (EL 7). During the reverseengineering analysis, DOE observed 

specific technology options employed at 

this efficiency level, and thus 

determined that an additional gap fill at 

this level is appropriate. 

For the top-loading compact product 

class, DOE defined the baseline 

efficiency level based on a survey of 

units currently available on the market, 

as described previously in section 

IV.C.2. Efficiency Level 1 and Efficiency 

Level 2 represent the standard levels 

proposed in the Consensus Agreement 

for 2015 and 2018, respectively. Chapter 

5 of the direct final rule TSD provides 

detailed descriptions of the design 

options manufacturers are likely to use 

to achieve the higher efficiency levels. 

For the front-loading compact product 

class, DOE defined the baseline 

efficiency level based on an 

extrapolation of the rated efficiencies of 

front-loading clothes washers with 

capacities nearing those that delineate 

the compact product class (i.e., 1.6 to 

3.0 cubic feet), as described in section 

IV.C.2. Efficiency Level 1 represents the 

2015 standard level proposed in the 

Consensus Agreement. 

Chapter 5 of the direct final rule TSD 

provides further details of the analysis 


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performed on the efficiency levels for 

this product class. As discussed in more 

detail in chapter 5, manufacturers 

indicated during manufacturer 

interviews that the efficiency levels 

chosen by DOE would not result in an 

increased cycle time for units within 

any of the product classes established in 

today’s direct final rule, an assertion 

that is supported by DOE analysis of test 

data and published product literature. 

DOE seeks comment on this issue in 

section II.B.3. 

4. Maximum Technologically Feasible 

Efficiency Levels 

In the framework document, DOE 

based its max-tech level for top-loading 

standard and front-loading standard 

residential clothes washers on the 

maximum performance of products 

currently on the market in the United 

States, based on its review of various 

product databases. DOE considered 

several models in each product class to 

determine max-tech values that best 

represent optimal performance of IMEF 

and IWF for clothes washers on the 

market. DOE sought comment on 

whether the ‘‘maximum available’’ 

efficiency levels, shown in Table IV–12, 

represented max-tech efficiency. 

TABLE IV–12—PROPOSED MAXIMUM

TECHNOLOGICALLY FEASIBLE EFFICIENCY LEVELS PROPOSED IN THE

FRAMEWORK DOCUMENT FOR RESIDENTIAL CLOTHES WASHERS

Product class 

Max-tech levels 

MEF WF 

1. Top-loading, Compact (less than 1.6 

ft3 capacity) ........... 0.78 13.90 

2. Top-loading, 

Standard ................ 2.26 4.48 

3. Front-loading ........ 2.89 3.36 

The American Water Works 

Association (AWWA), the California 

Utilities, the Joint Comment, and PG&E 

objected to the use of ‘‘maximum 

available’’ efficiency levels as a 

substitute for max-tech. AWWA, the 

California Utilities, and the Joint 

Comment stated that DOE must survey 

available technologies to determine the 

maximum achievable levels. (AWWA, 

No. 14 at p. 1; California Utilities, No. 

19 at p. 5; Joint Comment, No. 15 at p. 

5; PG&E, Public Meeting Transcript, No. 

7 at p. 90) Whirlpool stated that it 

believes that it manufactures the model 

that is the basis for the maximum 

available level for top-loading clothes 

washers. Whirlpool stated that this 

maximum available level is at or near 

the max-tech limit. Even so, Whirlpool 

stated that the platform is relatively 

costly (with a suggested retail price of 

$1099–$1299), so that it would not be 

an economically justified standard level. 

ALS commented that the max-tech 

efficiency level should not represent a 

niche product, a product with low-end 

capacity, or some proprietary design. 

SCE asked whether an efficiency-level 

approach would limit how DOE 

develops its max-tech levels. (ALS, No. 

13 at p. 9; Whirlpool, Public Meeting 

Transcript, No. 7 at p. 91, Whirlpool, 

No. 22 at p. 6; SCE, Public Meeting 

Transcript, No. 7 at p. 90) 

Under EPCA, DOE is required to 

consider the maximum technologically 

feasible level. DOE determines max-tech 

levels based on technologies that are 

either commercially available or have 

been demonstrated as working 

prototypes. If the max-tech design meets 

DOE’s screening criteria, DOE considers 

the design in further analysis. DOE also 

considers consumer utility and 

availability of features, which may be 

met by a niche product, as required by 

EPCA. 

As described previously, DOE became 

aware of a new top-loading standard 

clothes washer with a higher MEF and 

lower WF than the max-tech level 

considered in the framework document. 

This new max-tech efficiency level was 

added for the direct final rule analysis. 

For front-loading standard clothes 

washers, DOE did not identify any other 

designs or combinations of technologies 

beyond the ‘‘maximum available’’ that 

would lead to a different max-tech level 

without requiring proprietary designs. 

For top-loading compact clothes 

washers, DOE used the 2018 standard 

level proposed in the Consensus 

Agreement as the max-tech level, as 

described previously. For front-loading 

compact clothes washers, DOE used the 

2015 standard level proposed in the 

Consensus Agreement as the max-tech 

level. 

Finally, DOE has observed that the 

max-tech units on the market use a 

combination of significantly reduced 

water volumes, reduced water 

temperatures, extended cycle times, and 

extremely high spin speeds. (See 

chapter 5 of the direct final rule TSD). 

DOE is not aware of any additional 

design options that could be used to 

increase the efficiency beyond the maxtech levels without causing potential 

negative effects on consumer utility. Nor 

is DOE aware of any working prototype 

clothes washers that exceed the 

efficiency levels of the max-tech units 

on the market in the United States. 

Therefore, DOE believes the ‘‘max 

available’’ efficiency levels for 

residential clothes washers correspond 

to the maximum technologically feasible 

efficiency levels. Accordingly, DOE 

does not believe that using an 

efficiency-level approach would limit 

how it develops its max-tech levels. 

Table IV–13 shows the max-tech 

levels used for the final analysis. 

TABLE IV–13—MAXIMUM TECHNOLOGICALLY FEASIBLE EFFICIENCY

LEVELS FOR RESIDENTIAL CLOTHES

WASHERS FINAL ANALYSIS

Product class 

Max tech levels— 

appendix J2 

IMEF IWF 

Top-loading, Standard ......................... 2.04 4.1 

Front-loading, Standard ......................... 2.46 3.4 

Top-loading, Compact ....................... 1.15 12.0 

Front-loading, Compact ....................... 1.13 8.3 

5. Proprietary Designs 

In its engineering and economic 

analyses DOE considers all design 

options that are commercially available 

or present in a working prototype, 

including proprietary designs and 

technologies. DOE will consider a 

proprietary design in the subsequent 

analyses only if the achieved efficiency 

level can also be reached using other 

nonproprietary design options. If the 

proprietary design is the only approach 

available to achieve a given efficiency 

level, then DOE will reject that 

efficiency level to avoid impacts on 

competition that would likely result. 

AHAM, GE, and Whirlpool stated that 

they are not aware of any proprietary 

designs or technologies that would 

impact this rulemaking. (AHAM, Public 

Meeting Transcript, No. 7 at p. 93; 

AHAM, No. 16 at p. 5; GE, No. 20 at p. 

1; Whirlpool, No. 22 at p. 7) Earthjustice 

commented that DOE must evaluate the 

maximum technologically feasible 

standards for clothes washers, including 

those that use proprietary technology. 

According to Earthjustice, DOE’s 

unqualified rejection of efficiency levels 

incorporating proprietary technologies 

repeats the errors that DOE made over 

25 years ago in refusing to analyze 

efficiency levels incorporating 

technologies available only in 

prototypes. In that rulemaking, 

Earthjustice stated that the D.C. Circuit 

wrote that DOE ‘‘conclusively assume[d] 

that manufacturers cannot incorporate 

any prototypes for any product type or 

class into all appliances of that type or 

class [by the effective date of the 


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standard].’’ Natural Resources Defense 

Council v. Herrington, 768 F.2d 1355, 

1396 (D.C. Cir. 1985). Earthjustice 

believes that DOE’s approach in the 

current clothes washer rulemaking 

would similarly exclude a technology 

without any analysis of technological 

feasibility or economic justification. 

Earthjustice also stated that Congress 

clearly intended for DOE to carefully 

consider the impact of adopting 

standards that depend on the use of 

proprietary technologies, as it required 

in 42 U.S.C. 6295(o)(2)(B)(i)(V) that DOE 

consider the impact on competition in 

weighing the economic justification for 

a given standard level. Earthjustice 

concluded that DOE cannot lawfully 

exclude proprietary technologies from 

its analysis without a justification that 

complies with EPCA. (Earthjustice, No. 

17 at pp. 9–10) 

DOE considers in its analysis 

technologies that have been 

incorporated into working prototypes, 

consistent with the D.C. Circuit decision 

discussed above. DOE also considers 

proprietary technologies if the efficiency 

levels that can be met using those 

technologies can also be met using 

other, non-proprietary technologies. 

DOE does not consider proprietary 

technologies when such technologies 

provide the only means to reach a given 

efficiency level because of the potential 

market barriers and impacts on 

competition. 

6. Reverse Engineering 

ASAP and Samsung stated that they 

support DOE’s reverse engineering. 

(ASAP, Public Meeting Transcript, No. 

7 at p. 74; Samsung, No. 25 at p. 4) The 

California Utilities requested that DOE 

explore how to make pertinent 

manufacturer cost data available to the 

public while protecting manufacturer 

confidentiality. (California Utilities, No. 

19 at p. 5) To supplement and validate 

the AHAM data submittals, DOE 

conducted interviews with 

manufacturers. Cost information 

supplied to DOE by the manufacturers 

was aggregated or otherwise 

incorporated into the analysis to protect 

confidentiality. Data developed by DOE 

during the teardowns and subsequent 

analysis are detailed in chapter 5 of the 

direct final rule TSD. 

AHAM, ALS, BSH, and Whirlpool 

suggested that DOE complete its reverseengineering analysis on the following 

four product types: 

• Conventional agitator top-loading; 

• High efficiency agitator top-loading; 

• High efficiency non-agitator toploading; and 

• Standard-size front-loading. 

AHAM, GE, and Whirlpool also 

recommended that DOE reverseengineer compact top-loading clothes 

washers. BSH recommended adding 

both compact top-loading and compact 

front-loading clothes washers. (AHAM, 

Public Meeting Transcript, No. 7 at p. 

81; AHAM, No. 16 at p. 5; ALS, No. 13 

at p. 9; BSH, No. 11 at p. 4; GE, No. 20 

at p. 1; Whirlpool, No. 22 at p. 6) DOE’s 

test sample for its reverse engineering 

analysis included representative 

residential clothes washers from all of 

these categories. DOE modeled the 

likely construction of a compact frontloading clothes washer by extrapolating 

from front-loading clothes washers with 

capacities nearing those delineating the 

compact product class (i.e., between 1.6 

and 3.0 cubic feet in capacity). 

ASAP stated that, when DOE 

evaluates the characteristics of baseline 

models, no extraneous features and 

amenities should be included that do 

not contribute to energy and water 

performance. (ASAP, Public Meeting 

Transcript, No. 7 at p. 74) DOE’s cost 

models disaggregate total manufacturing 

costs by sub-assemblies and individual 

components, thereby allowing DOE to 

identify only those specific design 

options contributing to incremental 

efficiency improvements. 

Based on product teardowns and cost 

modeling, DOE developed overall costefficiency relationships for all four 

residential clothes washer product 

classes. Table IV–14 through Table IV– 

17 show DOE’s estimates of incremental 

manufacturing cost for improvement of 

clothes washer efficiency above the 

baseline. As mentioned previously in 

section IV.C.3.b, DOE applied the 

correlation curves it developed to 

translate MEF into IMEF and WF into 

IWF. Chapter 5 of the direct final rule 

TSD provides details on DOE’s 

engineering analysis, including the 

development of the cost-efficiency 

curves and correlation curves. 

TABLE IV–14—COST-EFFICIENCY RELATIONSHIP FOR TOP-LOADING STANDARD RESIDENTIAL CLOTHES WASHERS

Efficiency level 

Efficiency level—appendix J1 Integrated efficiency level—appendix J2 Incremental manufacturing cost 

(2010$) MEF 

(ft3/kWh/cycle) 

WF 

(gal/cycle/ft3) 

IMEF 

(ft3/kWh/cycle) 

IWF 

(gal/cycle/ft3) 

Baseline ................................................. 1.26 9.5 0.84 9.9 $0.00 

EL 1 ....................................................... 1.40 9.5 0.98 9.9 3.11 

EL 2 ....................................................... 1.72 8.0 1.29 8.4 8.44 

EL 3 * ..................................................... 1.80 7.5 1.34 7.9 13.06 

EL 5 ....................................................... 1.80 7.5 1.37 7.9 14.24 

EL 6 ....................................................... 2.00 6.0 1.57 6.5 25.29 

EL 7 ....................................................... 2.26 4.5 1.83 5.0 60.65 

EL 8 ....................................................... 2.47 3.6 2.04 4.1 69.79 

* EL4 is not included in the table because it has the same IMEF and IWF as EL 3. The incremental manufacturing cost for EL 4 is $16.98. 

TABLE IV–15—COST-EFFICIENCY RELATIONSHIP FOR FRONT-LOADING STANDARD RESIDENTIAL CLOTHES WASHERS

Efficiency level 

Efficiency level—appendix J1 Integrated efficiency level—appendix J2 Incremental manufacturing cost 

(2010$) MEF 

(ft3/kWh/cycle) 

WF 

(gal/cycle/ft3) 

IMEF 

(ft3/kWh/cycle) 

IWF 

(gal/cycle/ft3) 

Baseline ................................................. 1.72 8.0 1.37 8.3 $0.00 

EL 1 ....................................................... 1.72 8.0 1.39 8.3 3.92 

EL 2 ....................................................... 1.72 8.0 1.41 8.3 1.18 

EL 3 ....................................................... 1.80 7.5 1.49 7.8 3.18 

EL 4 ....................................................... 2.00 6.0 1.66 6.3 6.20 

EL 5 ....................................................... 2.20 4.5 1.84 4.7 17.25 


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21U.S. Census, 2002 Business Expenditure 

Survey (BES), Electronics and Appliance Stores 

sectors. 

22For information on RECS, see www.eia.doe.gov/ 

emeu/recs/. 

TABLE IV–15—COST-EFFICIENCY RELATIONSHIP FOR FRONT-LOADING STANDARD RESIDENTIAL CLOTHES WASHERS— 

Continued 

Efficiency level 

Efficiency level—appendix J1 Integrated efficiency level—appendix J2 Incremental manufacturing cost 

(2010$) MEF 

(ft3/kWh/cycle) 

WF 

(gal/cycle/ft3) 

IMEF 

(ft3/kWh/cycle) 

IWF 

(gal/cycle/ft3) 

EL 6 ....................................................... 2.40 4.2 2.02 4.4 40.36 

EL 7 ....................................................... 2.60 3.8 2.20 4.0 53.88 

EL 8 ....................................................... 2.89 3.2 2.46 3.4 73.51 

TABLE IV–16—COST-EFFICIENCY RELATIONSHIP FOR TOP-LOADING COMPACT RESIDENTIAL CLOTHES WASHERS

Efficiency level 

Efficiency level—appendix J1 Integrated efficiency level—appendix J2 Incremental manufacturing cost 

(2010$) MEF 

(ft3/kWh/cycle) 

WF 

(gal/cycle/ft3) 

IMEF 

(ft3/kWh/cycle) 

IWF 

(gal/cycle/ft3) 

Baseline ................................................. 0.77 14.0 0.59 14.4 $0.00 

EL 1 ....................................................... 1.26 14.0 0.86 14.4 5.00 

EL 2 ....................................................... 1.81 11.6 1.15 12.0 45.00 

TABLE IV–17—COST-EFFICIENCY RELATIONSHIP FOR FRONT-LOADING COMPACT RESIDENTIAL CLOTHES WASHERS

Efficiency level 

Efficiency level—appendix J1 Integrated efficiency level—appendix J2 Incremental manufacturing cost 

(2010$) MEF 

(ft3/kWh/cycle) 

WF 

(gal/cycle/ft3) 

IMEF 

(ft3/kWh/cycle) 

IWF 

(gal/cycle/ft3) 

Baseline ................................................. 1.60 8.5 1.03 8.8 $0.00 

EL 1 ....................................................... 1.72 8.0 1.13 8.3 3.00 

D. Markups Analysis 

The markups analysis develops 

appropriate markups in the distribution 

chain to convert the estimates of 

manufacturer cost derived in the 

engineering analysis to consumer prices. 

At each step in the distribution channel, 

companies mark up the price of the 

product to cover business costs and 

profit margin. For clothes washers, the 

main parties in the distribution chain 

are manufacturers and retailers. 

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 residential clothes washers. 

For retailers, DOE developed separate 

markups for baseline products (baseline 

markups) and for the incremental cost of 

more efficient products (incremental 

markups). Incremental markups are 

coefficients that relate the change in the 

manufacturer sales price of higherefficiency models to the change in the 

retailer sales price. DOE relied on 

economic data from the U.S. Census 

Bureau to estimate average baseline and 

incremental markups.21

Chapter 6 of the direct final rule TSD 

provides details on DOE’s development 

of markups for residential clothes 

washers. 

E. Energy and Water Use Analysis 

DOE’s energy and water use analysis 

estimated the energy and water use of 

clothes washers in the field, i.e., as they 

are actually used by consumers. The 

energy and water use analysis provided 

the basis for other analyses DOE 

performed, particularly assessments of 

the energy and water savings and the 

savings in consumer operating costs that 

could result from DOE’s adoption of 

amended standards. In contrast to the 

DOE test procedure, which provides 

standardized results that can serve as 

the basis for comparing the performance 

of different appliances used under the 

same conditions, the energy and water 

use analysis seeks to capture the range 

of operating conditions for clothes 

washers in U.S. homes. 

To determine the field energy and 

water use of products that would meet 

possible amended standard levels, DOE 

used data from the Energy Information 

Administration (EIA)’s 2005 Residential 

Energy Consumption Survey (RECS), 

which was the most recent such survey 

available at the time of DOE’s analysis.22

RECS is a national sample survey of 

housing units that collects statistical 

information on the consumption of and 

expenditures for energy in housing units 

along with data on energy-related 

characteristics of the housing units and 

occupants. RECS provides sufficient 

information to establish the type 

(product class) of clothes washer used 

in each household. As a result, DOE was 

able to develop household samples for 

each of the considered product classes. 

RECS is the only source that provides a 

nationally representative household 

sample that includes estimates of usage 

by clothes washers. 

For each sample household, DOE 

estimated the field-based annual energy 

and water use of front- and top-loading 

standard-capacity clothes washers by 

multiplying the annual number of 

clothes washer cycles for each 

household by the per-cycle energy and 

water use values established by the 

engineering analysis (using the DOE test 

procedure) for each considered 

efficiency level. Per-cycle clothes 

washer energy use is calculated in the 

test procedure as the sum of per-cycle 

machine energy use of the washer 

(including the energy used to heat water 

and remove moisture from clothing, and 

standby and off-mode energy use. 

During the framework document 

public meeting, Whirlpool stated that 

although RECS has its limitations, there 


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Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 32339 

23 In the TP final rule, DOE changed the 

representative number of wash cycles per year from 

392 to 295 based on the 2005 RECS data. (77 FR 

13888) 

24Procter and Gamble. Study #US064358: Drying 

Habits. Unpublished PowerPoint Deck. Procured 

through personal communication with author 

Cindy Garner, 7/21/2009. 

25S. Sorrell, J. Dimitropoulos, and M. 

Sommerville, Empirical estimates of the direct 

rebound effect: a review, Energy Policy 37 (2009), 

pp. 1356–71. 

26L.W. Davis, Durable Goods and Residential 

Demand for Energy and Water: Evidence from a 

Field Trial, Department of Economics, University of 

Michigan (2007). 

is no alternative for characterizing the 

annual energy use of clothes washers. 

(Whirlpool, No. 22 at p. 7) AHAM, ALS, 

and GE expressed support for DOE’s 

plan to use RECS as a primary source of 

information for estimating the energy 

consumption of clothes washers. 

(AHAM, No. 16 at p. 6; ALS, No. 13 at 

p. 10; GE, No. 20 at p. 1) 

A more detailed description of DOE’s 

energy and water use analysis for 

clothes washers is contained in chapter 

7 of the direct final rule TSD. 

1. Clothes Washer Usage 

Commenting on the framework 

document, AWE said that average wash 

cycles per year are decreasing. (AWE, 

No. 12 at p. 3) AHAM stated that DOE 

should reduce the assumed average 

number of loads to reflect current data. 

(AHAM, No. 7 at p. 115) The Joint 

Comment said that DOE must update 

the average number of use cycles based 

on current data. (Joint Comment, No. 15 

at p. 5) 

Data collected from the 2005 RECS 

indicate that the frequency of clothes 

washer use has decreased compared to 

the assumptions incorporated in DOE’s 

previous test procedure. The average 

usage value obtained from RECS is 295 

cycles per year.23 Data collected by DOE 

from the AHAM Fact Book 2005, 

American Housing Survey (AHS) 2007, 

and 2006 data provided by Proctor and 

Gamble 24 confirmed the data on average 

wash cycles from RECS. More recent 

nationally-representative data were not 

available. It is important to note that 

DOE uses the actual usage for each 

household sampled in its energy use 

analysis, not the average usage. 

AWE said that DOE should consider 

that average washer capacity is 

increasing. (AWE, No. 12 at p. 3) The 

new DOE test procedure, which was 

used for estimating per cycle clothes 

washer energy use, considers recent 

data on the clothes load in calculating 

energy use to remove moisture from 

clothing. The load is a weighted average 

that depends on load usage factors and 

the capacity of the clothes washer. 

2. Rebound Effect 

In calculating energy consumption of 

residential clothes washers, DOE 

considered whether it would be 

appropriate to include a rebound effect 

(also called a take-back effect), which 

represents the increased energy 

consumption that can result from 

increases in energy efficiency and the 

associated reduction in operating costs. 

The rebound effect assumes that 

consumers will increase their overall 

annual usage of a more efficient 

product, thereby decreasing their overall 

annual savings. Samsung, AHAM, and 

GE said that they are unaware of a 

rebound effect for residential clothes 

washers. (Samsung, No. 25 at p. 5; 

AHAM, No. 16 at p. 6; GE, No. 20 at p. 

1) Whirlpool stated that it is unaware of 

any data indicating that consumers 

would purchase a larger clothes washer 

than their needs dictated. (Whirlpool, 

No. 22 at p. 7) 

A recent review of empirical estimates 

of the direct rebound effect 25 found one 

study of direct rebound effects for 

clothes washing. This study found that 

the demand for clean clothes (measured 

as weight of clothes) increased by 5.6% 

after consumers received new (more 

efficient) washers.26 This rebound effect 

results in part from savings in water and 

detergent costs. If the estimate was 

based solely on the savings in the 

energy costs of the service, the 

estimated effect would be smaller. DOE 

does not believe that this study supports 

include a rebound effect in today’s 

direct final rule, however, because the 

study used field data from participants 

who received high-efficiency clothes 

washers free of charge and was shortterm in nature—roughly 3 months of use 

with the new washers. These factors 

could contribute to the increase in 

clothes washed. Lastly, the field trial 

was in a very small town and included 

103 participants, which may not be 

representative of the U.S. household 

population. 

Based on the above considerations 

and the comments by manufacturers, 

DOE did not include a direct rebound 

effect in its analysis of residential 

clothes washer energy and water use. 

However, DOE did perform a sensitivity 

analysis assuming a 5-percent rebound 

effect. 

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 clothes washers. The LCC is the total 

consumer expense over the life of a 

product, consisting of purchase 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. 

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 

(normally higher) due to a more 

stringent standard by the change in 

average annual operating cost (normally 

lower) that results from the standard. 

For any given efficiency level, DOE 

measures the PBP and the change in 

LCC relative to an estimate of the basecase appliance efficiency levels. The 

base-case estimate reflects the market in 

the absence of new or amended energy 

conservation standards, including the 

market for products that exceed the 

current energy conservation standards. 

For each considered efficiency level 

in each product class, DOE calculated 

the LCC and PBP for a nationally 

representative set of housing units. For 

the analysis for today’s rule, DOE 

developed household samples from the 

2005 RECS. For each sample household, 

DOE determined the energy 

consumption for the clothes washer and 

the appropriate electricity price. By 

developing a representative sample of 

households, the analysis captured the 

variability in energy consumption and 

energy prices associated with the use of 

residential clothes washers. 

Inputs to the calculation of total 

installed cost include the cost of the 

product—which includes manufacturer 

costs, manufacturer markups, retailer 

and distributor markups, and sales 

taxes—and installation costs. Inputs to 

the calculation of operating expenses 

include annual energy consumption, 

energy and water prices and price 

projections, repair and maintenance 

costs, product lifetimes, discount rates, 

and the year that compliance with 

standards is required. 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, which 

incorporates Crystal Ball (a 

commercially available software 

program), relies on a Monte Carlo 

simulation to incorporate uncertainty 

and variability into the analysis. The 

Monte Carlo simulations randomly 


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32340 Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 

27For the NIA, DOE also considered several 

alternative price trends consistent with the 

available data as sensitivity cases (see section 

IV.G.4). 

28 DOE recognizes that its price trend forecasting 

methods are likely to be modified as more data and 

information becomes available to enhance the 

statistical certainty of the trend estimate and the 

completeness of the model. Additional data should 

enable an improved evaluation of the potential 

impacts of more of the factors that can influence 

product price trends over time. 

sample input values from the 

probability distributions and clothes 

washer user samples. The model 

calculated the LCC and PBP for 

products at each efficiency level for 

10,000 housing units per simulation 

run. 

Several interested parties supported 

DOE’s use of Monte Carlo simulation to 

account for variability and uncertainty 

in inputs to the LCC and PBP analysis. 

(AHAM, No. 16 at p. 6; ALS, No. 13 at 

p. 10; GE, No. 20 at p. 1; Samsung, No. 

25 at p. 5; Whirlpool, No. 22 at p. 8) 

Table IV–18 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 and its appendices of the 

direct final rule TSD. 

TABLE IV–18—SUMMARY OF INPUTS AND METHODS FOR THE LCC AND PBP ANALYSIS * 

Inputs Method 

Product Cost ....................................................... Derived by multiplying manufacturer cost by manufacturer and retailer markups and sales tax, 

as appropriate. Used historical data to derive a price scaling index to forecast product costs. 

Installation Costs ................................................ Assumed no change with efficiency level. 

Annual Energy Use ............................................. Used DOE test procedure with data on cycles from the 2005 RECS, market data on RMC, and 

load weights from test procedure. 

Used IMEF and IWF to account for self-cleaning, steam cleaning and non-active mode power 

usage. 

Energy and Water Prices ................................... Electricity: Based on EIA’s Form 861 data for 2008. 

Variability: Regional energy prices determined for 13 regions. 

Water: Based on 2008 AWWA/Raftelis Survey. 

Variability: By census region. 

Energy and Water Price Trends ......................... Energy: Forecasted using Annual Energy Outlook 2010 (AEO2010) price forecasts. 

Water: Forecasted using BLS historic water price index information. 

Repair and Maintenance Costs .......................... Assumed no change with efficiency level. 

Product Lifetime .................................................. Estimated using survey results from RECS (1990, 1993, 1997, 2001, 2005) and the U.S. Census American Housing Survey (2005, 2007), along with historic data on appliance shipments. 

Variability: Characterized using Weibull probability distributions. 

Discount Rates ................................................... Approach involves identifying all possible debt or asset classes that might be used to purchase the considered appliances, or might be affected indirectly. Primary data source was 

the Federal Reserve Board’s SCF ** for 1989, 1992, 1995, 1998, 2001, 2004 and 2007. 

Compliance Date ................................................ 2015. 

* References for the data sources mentioned in this table are provided in the sections following the table or in chapter 8 of the direct final rule 

TSD. 

** Survey of Consumer Finances. 

1. Product Cost 

To calculate consumer product costs, 

DOE multiplied the manufacturer 

selling prices developed in the 

engineering analysis by the supplychain markups described above (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 higherefficiency products. ALS supported 

DOE’s approach, as it was employed for 

estimating future retail prices in other 

appliance rulemakings. (ALS, No. 13 at 

p. 10) 

Examination of historical price data 

for a number of appliances that have 

been subject to energy conservation 

standards indicates that an assumption 

of constant real prices and costs may 

overestimate long-term trends in 

appliance prices. Economic literature 

and historical data suggest that the real 

costs of these products may in fact trend 

downward over time according to 

‘‘learning’’ or ‘‘experience’’ curves. On 

February 22, 2011, DOE published a 

Notice of Data Availability (NODA, 76 

FR 9696) stating that DOE may consider 

improving regulatory analysis by 

addressing equipment price trends. In 

the NODA, DOE proposed that when 

sufficiently long-term data are available 

on the cost or price trends for a given 

product, it would analyze the available 

data to forecast future trends. 

Many commenters were supportive of 

DOE moving from an assumption-based 

equipment price trend forecasting 

method to a data-driven methodology 

for forecasting price trends. Other 

commenters were skeptical that DOE 

could accurately forecast price trends 

given the many variables and factors 

that can complicate both the estimation 

and the interpretation of the numerical 

price trend results and the relationship 

between price and cost. DOE evaluated 

these concerns and determined that 

retaining the assumption-based 

approach of a constant real price trend 

was not consistent with the historical 

data available for residential clothes 

washers. 

In its analysis for today’s notice, DOE 

performed an exponential fit on 

historical Producer Price Index (PPI) 

data for household laundry equipment 

from the Bureau of Labor Statistics’ 

(BLS). (PPI data specific to residential 

clothes washers were not available.) The 

PPI data used cover the period 1991– 

2010. An inflation-adjusted price index 

for household laundry equipment was 

calculated by dividing the PPI series by 

the GDP price deflator for the same 

years. DOE forecast a price factor index 

using this exponential model.27 The 

value for 2015 used in the LCC and PBP 

analysis is 0.882. Thus, product prices 

forecast for the LCC and PBP analysis 

are equal to 0.882 times the 2010 values 

for each efficiency level in each product 

class. DOE’s forecast of product prices 

for clothes washers is described in 

further detail in appendix 8–E of the 

direct final rule TSD.28


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29Available at: www.eia.doe.gov/cneaf/electricity/ 

page/eia861.html. 

30U.S. Energy Information Administration. 

Annual Energy Outlook 2010. Washington, DC. 

April 2010. 

2. Installation Cost 

Installation cost includes labor, 

overhead, and any miscellaneous 

materials and parts needed to install the 

product. DOE found no evidence that 

installation costs would be impacted 

with increased efficiency levels, so it 

did not include installation costs in its 

analysis. 

3. Annual Energy Consumption 

For each sampled household, DOE 

determined the energy consumption for 

a clothes washer at different efficiency 

levels using the approach described 

above in section IV.E. 

4. Energy Prices 

DOE derived average annual energy 

prices for 13 geographic areas consisting 

of the nine U.S. Census divisions, with 

four large states (New York, Florida, 

Texas, and California) treated 

separately. For Census divisions 

containing one of those large states, 

DOE calculated the regional average 

excluding the data for the large state. 

DOE calculated average residential 

electricity prices for each of the 13 

geographic areas using data from EIA’s 

Form EIA–861 database (based on 

‘‘Annual Electric Power Industry 

Report’’).29 DOE calculated an average 

annual regional residential price by: (1) 

Estimating an average residential price 

for each utility (by dividing the 

residential revenues by residential 

sales); and (2) weighting each utility by 

the number of residential consumers it 

served in that region. The final rule 

analysis used the data for 2008, the most 

recent data available. 

The Joint Comment stated that DOE 

should consider using regionally based, 

top-tier residential electricity prices 

rather than average rates because energy 

savings would occur at the highest rate 

the consumer might pay. The California 

Utilities stated that DOE’s analysis 

should capture the value of energy over 

time. They pointed to California’s use of 

time-dependent valuation of savings 

(TDV), which places a high value on 

energy savings that occur during high 

cost times of the day and year. 

(California Utilities, No. 19 at p. 6) ALS 

supported DOE’s approach because has 

been employed for estimating current 

and forecasted energy prices in other 

appliance rulemakings. (ALS, No. 13 at 

p. 10) 

DOE did not use marginal (i.e., toptier) electricity prices in the current 

analysis, because for an appliance such 

as a residential clothes washer, there is 

little difference between marginal and 

average electricity prices. The effect of 

ascending block rates, used by many 

utilities, is offset by two other features 

of rate structures: (1) Residential 

consumers tend to pay relatively high 

fixed charges, which raises the average 

price relative to the marginal energy 

price; and (2) seasonal rates also are 

common, with summer rates typically 

higher, and winter rates lower, than the 

average (this may be reversed in winterpeaking regions). Because clothes 

washer energy use is not seasonal, over 

the year the rate differences average out. 

DOE’s analysis of the Edison Electric 

Institute’s Typical Bills and Average 

Rates Reports for summer and winter 

2008 confirms that, when averaged over 

the year and over a wide consumer base, 

as is appropriate for clothes washers, 

marginal and average rates are 

approximately equal. 

5. Energy Price Projections 

To estimate energy prices in future 

years, DOE multiplied the average 

regional energy prices discussed in 

section IV. F.4 by the forecasts of annual 

average residential energy price changes 

in the Reference case from AEO2010, 

which has an end year of 2035.30 To 

estimate price trends after 2035, DOE 

applied the average annual rate of 

change in the AEO2010 forecasts from 

2020 to 2035. The rates used were 1.14 

percent for electricity price and 1.16 

percent for natural gas price. 

6. Water and Wastewater Prices 

For today’s direct final rule, DOE 

obtained data on water and wastewater 

prices for 2010 from the Water and 

Wastewater Rate Survey conducted by 

Raftelis Financial Consultants and the 

water utility association, AWWA. The 

survey, which analyzes each industry 

separately, covers approximately 308 

water utilities and 228 wastewater 

utilities. The water survey includes, for 

each utility, the cost to consumers of 

purchasing a given volume of water or 

treating a given volume of wastewater. 

The data provide a division of the total 

consumer cost into fixed and volumetric 

charges. DOE’s calculations use only the 

volumetric charge to calculate water and 

wastewater prices, because only this 

charge is affected by a change in water 

use. Average water and wastewater 

prices were estimated for each of four 

census regions. Each RECS household 

was assigned a water and wastewater 

price depending on its census region 

location. 

Commenting on the framework 

document, AWWA stated that the Water 

and Wastewater Survey conducted by 

Raftelis and AWWA is the best available 

national survey of water and wastewater 

rates. AWWA also noted additional 

steps that DOE can take to make its 

incorporation of available water and 

sewer rates more robust. These include 

considering base charges that are 

embedded in the cost of customer 

service; capturing differences in rate 

structures at the community level; and 

accounting for variability in rate 

structures due to asset management 

systems at some utilities. (AWWA, No. 

14 at p. 3) 

In response, DOE believes, as stated 

above, that using only the volumetric 

charge to calculate water and 

wastewater prices is appropriate, 

because only this charge is affected by 

a change in water use. DOE was not able 

to capture differences and variability in 

rate structures to the degree suggested 

by AWWA because the Water and 

Wastewater Rate Survey does not have 

a large enough number of utilities to 

allow DOE to develop prices at a level 

more detailed than the Census region. 

AWWA stated that while it is difficult 

to fully capture the true future cost of 

water in a national analysis, reliance on 

a simple extrapolation of current rate 

structures alone is inadequate. It 

suggested that DOE account for the need 

of water and wastewater systems to 

increase rates in the next 30 to 50 years 

as systems age. (AWWA, No. 14 at p. 2– 

3) DOE is not aware of any nationallevel long-term forecasts of water and 

wastewater prices. To forecast water and 

wastewater price trends, DOE used a 

price index for water and sewerage 

maintenance from the Bureau of Labor 

Statistics (BLS), and then adjusted the 

index for inflation using the Consumer 

Price Index. DOE developed a price 

trend based on 45 years of BLS data 

from 1975 to 2010. 

DOE also used price information for 

households that use well water and a 

septic tank from the National Ground 

Water Association, as well as national 

cost data on residential septic systems 

from the National Onsite Wastewater 

Recycling Association (NOWRA). 

Chapter 8 of the direct final rule TSD 

provides more detail about DOE’s 

approach to developing water and 

wastewater prices. 

7. Maintenance and Repair Costs 

Repair costs are associated with 

repairing or replacing components that 

have failed in an appliance; 

maintenance costs are associated with 

maintaining the operation of the 

product. Typically, small incremental 


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32342 Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 

increases in product efficiency produce 

no, or only minor, changes in repair and 

maintenance costs compared to baseline 

efficiency products. In its preliminary 

analysis, DOE did not have information 

suggesting that those costs would 

change with higher efficiency levels. 

AHAM and GE stated that information 

obtained from clothes washer 

manufacturers indicates that where 

higher efficiencies are provided via a 

different configuration (horizontal axis 

compared to vertical axis), the costs of 

maintenance and repair increase. 

(AHAM, No. 16 at p. 7; GE, No. 20 at 

p. 1) BSH stated that because frontloading units often are installed stacked 

with the dryer on top of the washer or 

built into cabinetry, a greater effort is 

required to access the appliances to 

perform service. (BSH, No. 11 at p. 6) 

Miele stated that there can be a higher 

repair cost for apartment-size frontloaders because they must be removed 

from the stacked installation to do the 

repair. (Miele, Public Meeting 

Transcript, No. 7 at p. 130) ALS 

suggested that high efficiency 

technologies may have greater frequency 

of maintenance. (ALS, No. 13 at p. 10) 

Whirlpool said that maintenance, repair, 

and installation costs could be twice 

current levels if exotic new technologies 

are required to meet new efficiency 

levels. (Whirlpool, No. 22 at p. 8) ASAP 

said that claims of significantly higher 

repair costs for front-loading machines 

must be evaluated critically and that 

recent data for front-loaders should be 

used. (ASAP, No. 14 at p. 6) Samsung 

agreed with the view that there is 

negligible difference in maintenance, 

repair, and installation costs for baseline 

and high efficiency units. (Samsung, No. 

25 at p. 6) 

DOE does not have any data 

indicating increases in maintenance and 

repair costs associated with the 

efficiency levels within each of the 

product classes considered in its 

analysis. (Differences in such costs 

between top- and front-loading washers 

are not relevant to the LCC analysis.) 

Therefore, DOE did not assume that 

more efficient washers in each product 

class would have greater repair or 

maintenance costs. 

8. Product Lifetime 

Because the lifetime of appliances 

varies depending on utilization and 

other factors, DOE develops a 

distribution of lifetimes from which 

specific values are assigned to the 

appliances in the samples. In the 

previous rulemaking for clothes 

washers, DOE estimated an average 

product lifetime of 14.1 years. 66 FR 

3314. 

Commenting on the framework 

document, AHAM and GE stated that 

DOE’s estimate of 14 years overstates 

the average useful life of horizontal-axis 

products. They stated that, based on 

AHAM data, the average useful life of 

top-loading configurations is 14 years, 

while that of front-loading 

configurations is 11 years. (AHAM, No. 

16 at p. 7; GE, No. 20 at p. 1) Samsung 

supported using DOE’s estimated useful 

life of 14.1 years. (Samsung, No. 25 at 

p. 6) Whirlpool stated that the 

September 2008 issue of Appliance 

magazine cites an average life of 11 

years, which is consistent with their 

experience. (Whirlpool, No. 22 at p. 8) 

ALS supported using an average 

product lifetime of 14 years, but for only 

the traditional top-loading models. They 

said that front-loading and new high 

efficiency top-loading designs may have 

shorter lifetimes because of greater 

design complexity, electronic 

components that are more expensive to 

repair, complaints about mold in door 

boot/seals, and issues concerning out-ofbalance spin. (ALS, No. 13 at p. 11) The 

Joint Comment said that claims of 

substantially shorter product lifetimes 

for front-loaders must be evaluated 

critically. (Joint Comment, No. 15 at 

p. 6) 

To substantiate the estimates for 

residential clothes washer lifetimes in 

the literature, DOE conducted an 

analysis of standard-capacity residential 

clothes washer lifetimes in the field 

based on a combination of shipments 

data and RECS 2005 data on the ages of 

the clothes washer products reported in 

the household stock. As described in 

chapter 8 of the direct final rule TSD, 

the analysis yielded an estimate of mean 

age for standard-capacity residential 

clothes washers of approximately 14.2 

years. It also yielded a survival function 

that DOE incorporated as a probability 

distribution in its LCC analysis. Because 

the RECS data do not indicate whether 

the washer has top-loading or frontloading configuration, DOE was not able 

to derive separate lifetime estimates for 

these two product classes. DOE did not 

receive any data or analysis to support 

separate lifetimes for the different 

product classes. 

See chapter 8 of the direct final rule 

TSD for further details on the method 

and sources DOE used to develop 

product lifetimes. 

9. Discount Rates 

In the calculation of LCC, DOE 

applies discount rates to estimate the 

present value of future operating costs. 

DOE estimated separate distributions of 

residential discount rates for clothes 

washers purchased as replacements and 

for washers purchased in new homes. 

To establish residential discount rates 

for the LCC analysis, DOE identified all 

debt or asset classes that might be used 

to purchase clothes washers, including 

household assets that might be affected 

indirectly. It estimated the average 

percentage shares of the various debt or 

asset classes for the average U.S. 

household using data from the Federal 

Reserve Board’s Survey of Consumer 

Finances (SCF) for 1989, 1992, 1995, 

1998, 2001, 2004, and 2007. Using the 

SCF and other sources, DOE then 

developed a distribution of rates for 

each type of debt and asset 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 inflation-adjusted rate 

across all types of household debt and 

equity, weighted by the shares of each 

class, is 5.1 percent. DOE used the same 

approach for today’s direct final rule. 

See chapter 8 in the direct final rule 

TSD for further details on the 

development of consumer discount 

rates. 

10. Compliance Date of Amended 

Standards 

In the context of EPCA, the 

compliance date is the future date when 

parties subject to the requirements of a 

new standard must comply. If no 

adverse comments are received in 

response to the direct final rule that may 

provide a reasonable basis for 

withdrawal under 42 U.S.C. 6295(o) or 

other applicable law, compliance with 

amended standards for residential 

clothes washers will be required on 

March 7, 2015. DOE calculated the LCC 

and PBP for clothes washers as if 

consumers would purchase new 

products in 2015. In the case of TSL 3, 

which includes a second set of 

standards for top-loading standard 

clothes washers that would require 

compliance on January 1, 2018, DOE 

calculated separate LCC and PBP for 

clothes washers meeting these standards 

and purchased in 2018. 

11. Base-Case Efficiency Distribution 

To accurately estimate the share of 

consumers that would be affected by a 

standard at a particular efficiency level, 

DOE’s LCC analysis considered the 

projected distribution of product 

efficiencies that consumers purchase 

under the base case (i.e., the case 

without new energy efficiency 

standards). DOE refers to this 

distribution of product efficiencies as a 

base-case efficiency distribution. DOE 

relied on data submitted by AHAM to 


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estimate the base-case efficiency 

distributions for each of the product 

classes that were analyzed in the LCC 

and PBP analysis. To project the 

efficiency distributions in 2015, DOE 

considered the 2006–2008 trends and 

the potential effect of programs such as 

ENERGY STAR. 

For front-loading clothes washers, the 

data from AHAM show some increase in 

the share of higher efficiency levels 

between 2006 and 2008. However, by 

2008 over 95 percent of the frontloading clothes washer market was 

already at or above the 2011 ENERGY 

STAR criteria (Efficiency Level 4). 

Therefore, DOE believes that the 

ENERGY STAR qualification 

requirements are likely to have a limited 

impact in further expanding the market 

shares of higher efficiency front-loading 

clothes washers. Based on the above 

considerations, DOE assumed that the 

2008 market shares would remain 

constant through 2015. 

For top-loading clothes washers, the 

data from AHAM show an increase in 

the share of medium- and highefficiency levels (Efficiency Levels 2–8) 

from 6.3 percent in 2006 to 8.5 percent 

in 2008. To estimate a trend from 2008 

to 2015, DOE fit an exponential curve to 

the three data points that suggests the 

growth in share would level off at 

around 20 percent. The estimated total 

share of the medium- and highefficiency levels in 2015 is 19.2 percent. 

DOE then disaggregated this total share 

into shares of specific levels using 

assumptions described in chapter 8 of 

the direct final rule TSD. 

Table IV–19 shows the 2015 base-case 

efficiency distribution for top-loading 

and front-loading clothes washers. 

TABLE IV–19—BASE-CASE EFFICIENCY DISTRIBUTION BY PRODUCT CLASS

Efficiency level 

Top-loading 

standard size 

(percent) 

Front-loading 

standard size 

(percent) 

Top-loading 

compact size 

(percent) 

Front-loading 

compact size 

(percent) 

Baseline ........................................................................................... 40.4 0.0 100.0 100.0 

1 ....................................................................................................... 40.4 0.0 0.0 0.0 

2 ....................................................................................................... 2.8 0.0 0.0 ............................

3 ....................................................................................................... 0.9 4.3 ............................ ............................

4 ....................................................................................................... 0.9 24.0 ............................ ............................

5 ....................................................................................................... 0.9 48.9 ............................ ............................

6 ....................................................................................................... 9.1 11.4 ............................ ............................

7 ....................................................................................................... 4.6 11.4 ............................ ............................

8 ....................................................................................................... 0.0 0.0 ............................ ............................

12. Inputs to 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 are 

the total installed cost of the product to 

the customer for each efficiency level 

and the average annual operating 

expenditures for each efficiency level. 

The PBP calculation uses the same 

inputs as the LCC analysis, except that 

discount rates are not needed. 

13. Rebuttable-Presumption Payback 

Period 

As noted above, EPCA, as amended, 

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 

(and, as applicable, water) savings 

during the first year that the consumer 

will receive as a result of the standard, 

as calculated under the test procedure 

in place for that standard. (42 U.S.C. 

6295(o)(2)(B)(iii)) For each considered 

efficiency level, DOE determined the 

value of the first year’s energy and water 

savings by calculating the quantity of 

those savings in accordance with the 

applicable DOE test procedure, and 

multiplying that amount by the average 

energy and water price forecast for the 

year in which compliance with the 

amended standard would be required. 

The results of the rebuttable payback 

period analysis are summarized in 

section V.B.1.c of this notice. 

G. National Impact Analysis—National 

Energy Savings and Net Present Value 

Analysis 

The national impact analysis (NIA) 

assesses the national energy savings 

(NES) and the national net present value 

(NPV) of total consumer costs and 

savings that would be expected to result 

from new or amended standards at 

specific efficiency levels. (‘‘Consumer’’ 

in this context refers to consumers of 

the product being regulated.) DOE 

calculates the NES and NPV based on 

projections of annual appliance 

shipments, along with the annual 

energy consumption and total installed 

cost data from the energy use and LCC 

analyses. For the present analysis, DOE 

forecasted the energy savings, operating 

cost savings, product costs, and NPV of 

consumer benefits for products sold 

from 2015 through 2044. 

DOE evaluates the impacts of new and 

amended standards by comparing basecase projections with standards-case 

projections. The base-case projections 

characterize energy use and consumer 

costs for each product class in the 

absence of new or amended energy 

conservation standards. DOE compares 

these projections 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 

base-case forecast, DOE considers 

historical trends in efficiency and 

various forces that are likely to affect the 

mix of efficiencies over time. For the 

standards cases, DOE also considers 

how a given standard would likely 

affect the market shares of efficiencies 

greater than the standard. 

DOE uses an MS Excel spreadsheet 

model to calculate the energy savings 

and the national consumer costs and 

savings from each TSL. The TSD and 

other documentation that DOE provides 

during the rulemaking help explain the 

models and how to use them, and 

interested parties can review DOE’s 

analyses by changing various input 

quantities within the spreadsheet. The 

NIA spreadsheet model uses typical 

values (as opposed to probability 

distributions) as inputs. 

For the results presented in today’s 

notice, DOE used projections of energy 

prices and housing starts from the 

AEO2010 Reference case. The Joint 

Comment stated that electricity prices 


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32344 Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 

should be subject to a sensitivity 

analysis and forecasts other than AEO. 

(Joint Comment, No. 15 at p. 5) As part 

of the NIA, DOE analyzed scenarios that 

used inputs from the AEO2010 Low 

Economic Growth and High Economic 

Growth cases. Those cases have higher 

and lower energy price trends compared 

to the Reference case, as well as higher 

and lower housing starts, which result 

in higher and lower appliance 

shipments to new homes. NIA results 

based on these cases are presented in 

appendix 10–A of the direct final rule 

TSD. The range of forecasts in AEO2010 

is sufficiently broad that using other 

long-range energy forecasts would not 

provide added value to the sensitivity 

analysis. 

Table IV–20 summarizes the inputs 

and methods DOE used for the NIA 

analysis for the direct final rule. 

Discussion of these inputs and methods 

follows the table. See chapter 10 of the 

direct final rule TSD for further details. 

TABLE IV–20—SUMMARY OF INPUTS AND METHODS FOR THE NATIONAL IMPACT ANALYSIS

Inputs Method 

Shipments .......................................................................................... Annual shipments from shipments model.

Compliance Date of Standard ........................................................... 2015.* 

Base-Case Forecasted Efficiencies ................................................... Efficiency distributions are maintained unchanged during the forecast period.

Standards-Case Forecasted Efficiencies .......................................... Used a ‘‘roll-up’’ scenario for most efficiency levels and a ‘‘shift’’ 

scenario for highest efficiency levels.

Annual Energy Consumption per Unit ............................................... Annual weighted-average values as a function of IMEF.** 

Total Installed Cost per Unit .............................................................. Annual weighted-average values as a function of IMEF.** 

Incorporates forecast of future product prices based on historical 

data.

Annual Energy Cost per Unit ............................................................. Annual weighted-average values as a function of the annual energy consumption per unit and energy prices.

Repair and Maintenance Cost per Unit ............................................. Annual values as a function of efficiency level.

Energy Prices .................................................................................... AEO2010 forecasts (to 2035) and extrapolation through 2044.

Energy Site-to-Source Conversion Factor ......................................... Varies yearly and is generated by NEMS–BT.

Discount Rate .................................................................................... Three and seven percent real.

Present Year ...................................................................................... Future expenses discounted to 2011, when the final rule will be 

published.

* For TSL 3, which includes two sets of standards for top-loading standard clothes washers, the compliance date for the second set of standards is in 2018. 

** IMEF = integrated modified energy factor, which includes the energy used in the active, standby, and off modes. 

1. Shipments 

Forecasts of product shipments are 

needed to calculate the national impacts 

of standards on energy and water use, 

NPV, and future manufacturer cash 

flows. DOE develops shipment forecasts 

based on an analysis of key market 

drivers for residential clothes washers. 

In DOE’s shipments model, shipments 

of products are driven by new 

construction and stock replacements. 

The shipments model takes an 

accounting approach, tracking market 

shares of each product class and the 

vintage of units in the existing 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 inservice 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. DOE also considers the impacts 

on shipments from changes in product 

purchase price and operating cost 

associated with higher energy efficiency 

levels. 

To forecast shipments under the base 

case, DOE utilized historical shipments 

data submitted by AHAM disaggregated 

by product class. AHAM and GE noted 

that they could not provide data on 

compact top-loading products given the 

few manufacturers and the resulting 

inability to aggregate the data. (AHAM, 

No. 16 at p. 8; GE, No. 20 at p. 1) 

AWE suggested that DOE consider the 

trend in multi-family housing toward 

in-unit washers and away from 

common-area clothes washers. (AWE, 

No. 12 at p. 3) DOE considered trends 

away from common-area clothes 

washers in multi-family housing by 

looking at changes in the numbers of 

households with clothes washers. DOE 

used the data contained in the 2005 

RECS to characterize ownership of 

residential clothes washers and usage in 

households of various types, including 

multi-family housing. For future trends, 

DOE captured in-unit washers within 

multi-family housing by estimating 

future clothes washer saturations in all 

new residential construction, including 

multi-family housing. 

To estimate the effects on product 

shipments from increases in product 

price projected to accompany amended 

standards at higher efficiency levels, 

DOE applied a cross-price elasticity. 

Cross-price impacts measure the change 

in the market share of one washer 

configuration (e.g., top loaders) caused 

by a change in the price of the other 

washer configuration (e.g., front 

loaders). DOE estimated a logistic 

regression model equation that derives 

the relative probability of the market 

share of top- and front- loading clothes 

washers as a function of the monthly 

sales-weighted average price of toploaders and front-loaders and the ratio 

of the monthly sales-weighted average 

of front-loader tub volume to the 

monthly sales-weighted average of toploader tub volume. The equation 

indicates that front loader market share 

is positively correlated with top loader 

price and size and negatively correlated 

with front loader price. The regression 

results were used to derive the cross 

price impact of a change in the toploading washer price on the front-loader 

market share (and vice versa). 

DOE also applied a price elasticity 

parameter to estimate the effect of 

standards on each product class by 

itself. DOE estimated the price elasticity 

parameter using a regression analysis 

that used purchase price and efficiency 

data specific to residential clothes 

washers, as well as residential 

refrigerators and dishwashers, during 

1980–2002. The estimated ‘‘relative 

price elasticity’’ incorporates the 

impacts from purchase price, operating 

cost, and household income, and it also 

declines over time. DOE estimated 

shipments in each standards case using 

the relative price elasticity along with 


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31 In the experience curve method, the real 

product price (or proxy thereof) is related to the 

cumulative production or ‘‘experience’’ with a 

product. As experience accumulates, the cost of 

producing the next unit decreases. The percentage 

reduction in cost that occurs with each doubling of 

cumulative production is known as the learning or 

experience rate. In typical experience curve 

formulations, the experience rate parameter is 

derived using two historical data series: Price (or 

cost) and cumulative production, which is a 

function of shipments during a long time span. 

the change in the relative price between 

a standards case and the base case. 

For details on the shipments analysis, 

see chapter 9 of the direct final rule 

TSD. 

2. Forecasted Efficiency in the Base Case 

and Standards Cases 

A key component of the NIA is the 

trend in energy efficiency forecasted for 

the base case (without new or amended 

standards) and each of the standards 

cases. Section IV.F.11 described how 

DOE developed a base-case energy 

efficiency distribution (which yields a 

shipment-weighted average efficiency) 

for each of the considered product 

classes for the first year of the forecast 

period. To project the trend in efficiency 

over the entire forecast period, DOE 

considered recent trends and the 

potential effect of programs such as 

ENERGY STAR. As discussed in section 

IV.F.11, DOE did not find a basis for 

projecting an increase in the average 

efficiency of front-loading clothes 

washers. For top-loading clothes 

washers, DOE assumed that the growth 

in share of the medium- and highefficiency levels would level off at 

around 20 percent. Although there is 

room for the shares of the higher 

efficiency levels to grow, DOE believes 

that the growth will be constrained by 

the likelihood that consumers with a 

strong interest in energy efficiency will 

purchase front-loading clothes washers 

instead of top-loading clothes washers. 

The historical record suggests that the 

likely market response to new or 

amended standards is that lower 

efficiency baseline models will roll up 

to the standard efficiency level, and 

some products will exceed the 

minimum requirements. To estimate 

efficiency trends in the standards cases, 

DOE has used ‘‘roll-up’’ and/or ‘‘shift’’ 

scenarios in its standards rulemakings. 

Under the ‘‘roll-up’’ scenario, DOE 

assumes: (1) Product efficiencies in the 

base case that do not meet the standard 

level under consideration would ‘‘rollup’’ to meet the new standard level; and 

(2) product efficiencies above the 

standard level under consideration 

would not be affected. Under the ‘‘shift’’ 

scenario, DOE re-orients the distribution 

above the new minimum energy 

conservation standard. 

For the direct final rule, DOE 

primarily used a roll-up scenario to 

establish the distribution of efficiencies 

for the year that compliance with 

revised standards would be required 

and for subsequent years. It also 

considered the potential impacts of the 

ENERGY STAR program. Because 

ENERY STAR criteria in 2011 consist of 

an MEF ≥2.00 and a WF ≤6.0, DOE 

assumed that the ENERGY STAR 

program would not affect the frontloader or top-loader market for any new 

standards set at levels less efficient than 

the 2011 ENERGY STAR requirements. 

As a result, for standards set at toploader efficiency levels 1 through 5 and 

front-loader efficiency levels 1 through 

3, DOE estimated that efficiency 

distributions would remain unchanged 

from 2015 through 2044. For any new 

standards set at efficiency levels that 

meet the 2011 ENERGY STAR 

requirements, DOE assumed that the 

market share of efficiency levels beyond 

the standard will increase. The level of 

increase was set equal to the market 

share change from 2006 to 2008 for the 

efficiency level directly preceding the 

standard. Using the above criteria, DOE 

assumed that from 2015 to 2022 the 

shipment weighted integrated modified 

energy factor (SWIMEF) market share 

would grow linearly. In all cases, 

because DOE has insufficient 

information on which to forecast 

changes in the market beyond 2022, 

DOE assumed that after 2022 the market 

would remain unchanged through 2044. 

The details of DOE’s approach to 

forecast efficiency trends are described 

in chapter 10 of the direct final rule 

TSD. 

3. Total Installed Cost per Unit 

As discussed in section IV.F.1, in the 

analysis for today’s notice, DOE 

developed a price trend based on 

historical PPI data for household 

laundry equipment. It used this trend to 

forecast the prices of clothes washers 

sold in each year in the forecast period 

(2015–2044). DOE applied the same 

values to forecast prices for each 

product class at each considered 

efficiency level. 

To evaluate the impact of the 

uncertainty of the price trend estimates, 

DOE investigated the impact of different 

product price forecasts on the consumer 

net present value for the considered 

TSLs for residential clothes washers. 

DOE considered three product price 

forecast sensitivity cases: (1) A trend 

based on the experience curve 

approach;31 (2) a trend based on the 

‘‘chained price index—other consumer 

durable goods except ophthalmic’’ that 

was forecasted for AEO2010; and (3) 

constant prices at 2010 levels. The 

results of these sensitivity cases are 

described in appendix 10–C of the 

direct final rule TSD. 

4. National Energy and Water Savings 

For each year in the forecast period, 

DOE calculates the national energy and 

water savings (NES) for each standard 

level by multiplying the stock of 

products affected by the energy 

conservation standards by the per-unit 

annual energy savings. Cumulative 

energy and water savings are the sum of 

the NES for each year. 

To estimate the national energy 

savings expected from appliance 

standards, DOE uses a multiplicative 

factor to convert site energy 

consumption (at the home) into primary 

or source energy consumption (the 

energy required to convert and deliver 

the site energy). These conversion 

factors account for the energy used at 

power plants to generate electricity and 

losses in transmission and distribution. 

The conversion factors vary over time 

because of projected changes in 

generation sources (i.e., the power plant 

types projected to provide electricity to 

the country). The factors that DOE 

developed are marginal values, which 

represent the response of the system to 

an incremental decrease in consumption 

associated with appliance standards. 

For today’s rule, DOE used annual siteto-source conversion factors based on 

the version of NEMS that corresponds to 

AEO2010, which provides energy 

forecasts through 2035. For 2036–2044, 

DOE used conversion factors that 

remain constant at the 2035 values. 

Section 1802 of the Energy Policy Act 

of 2005 (EPACT 2005) directed DOE to 

contract a study with the National 

Academy of Science (NAS) to examine 

whether the goals of energy efficiency 

standards are best served by measuring 

energy consumed, and efficiency 

improvements, at the actual point of use 

or through the use of the full-fuel-cycle, 

beginning at the source of energy 

production. (Pub. L. 109–58 (August 8, 

2005)). NAS appointed a committee on 

‘‘Point-of-Use and Full-Fuel-Cycle 

Measurement Approaches to Energy 

Efficiency Standards’’ to conduct the 

study, which was completed in May 

2009. The NAS committee defined fullfuel-cycle energy consumption as 

including, in addition to site energy use: 

Energy consumed in the extraction, 

processing, and transport of primary 

fuels such as coal, oil, and natural gas; 

energy losses in thermal combustion in 

power generation plants; and energy 

losses in transmission and distribution 

to homes and commercial buildings. 


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32OMB Circular A–4 (Sept. 17, 2003), section E, 

‘‘Identifying and Measuring Benefits and Costs. 

Available at: www.whitehouse.gov/omb/ 

memoranda/m03-21.html. 

In evaluating the merits of using 

point-of-use and full-fuel-cycle 

measures, the NAS committee noted 

that DOE uses what the committee 

referred to as ‘‘extended site’’ energy 

consumption to assess the impact of 

energy use on the economy, energy 

security, and environmental quality. 

The extended site measure of energy 

consumption includes the energy 

consumed during the generation, 

transmission, and distribution of 

electricity but, unlike the full-fuel-cycle 

measure, does not include the energy 

consumed in extracting, processing, and 

transporting primary fuels. A majority of 

the NAS committee concluded that 

extended site energy consumption 

understates the total energy consumed 

to make an appliance operational at the 

site. As a result, the NAS committee 

recommended that DOE consider 

shifting its analytical approach over 

time to use a full-fuel-cycle measure of 

energy consumption when assessing 

national and environmental impacts, 

especially with respect to the 

calculation of greenhouse gas emissions. 

The NAS committee also recommended 

that DOE provide more comprehensive 

information to the public through labels 

and other means, such as an enhanced 

Web site. For those appliances that use 

multiple fuels (e.g., water heaters), the 

NAS committee indicated that 

measuring full-fuel-cycle energy 

consumption would provide a more 

complete picture of energy consumed 

and permit comparisons across many 

different appliances, as well as an 

improved assessment of impacts. 

In response to the NAS committee 

recommendations, DOE issued a notice 

of proposed policy for incorporating a 

full-fuel cycle analysis into the methods 

it uses to estimate the likely impacts of 

energy conservation standards on 

energy use and emissions. 75 FR 51423 

(Aug. 20, 2010). Specifically, DOE 

proposed to use full-fuel-cycle (FFC) 

measures of energy and greenhouse gas 

(GHG) emissions, rather than the 

primary (extended site) energy measures 

it currently uses. Additionally, DOE 

proposed to work collaboratively with 

the Federal Trade Commission to make 

FFC energy and GHG emissions data 

available to the public to enable 

consumers to make cross-class 

comparisons. On October 7, 2010, DOE 

held an informal public meeting to 

discuss and receive comments on its 

planned approach. The notice, a 

transcript of the public meeting, and all 

public comments received by DOE are 

available at: http://www.regulations.gov/ 

#!docketDetail;D=EERE-2010-BT-NOA0028. DOE intends to develop a final 

policy statement on the subject and then 

take steps to begin implementing that 

policy in rulemakings and other 

activities. 

a. Accounting for Other Energy Impacts 

In the framework document for 

residential clothes washers, DOE 

requested comment on the issue of 

embedded energy (i.e., the energy 

required for water treatment and 

delivery). Earthjustice maintained that 

DOE’s legal justification for not 

considering embedded energy ‘‘ignores 

that EPCA not only provides ample 

authority for DOE to consider this 

impact, but actually commands its 

consideration in weighing the economic 

justification for efficiency standards.’’ 

(Earthjustice, No. 17 at p. 10) The 

California Utilities said that DOE should 

attempt to address the issue of 

embedded energy in water in its 

rulemaking analyses. (California 

Utilities, No. 19 at p. 5) 

In response, DOE notes that EPCA 

directs DOE to consider (when 

determining whether a standard is 

economically justified) ‘‘the total 

projected amount of energy, or as 

applicable, water, savings likely to 

result directly from the imposition of 

the standard.’’ 42 U.S.C. 

6295(o)(2)(B)(i)(III) DOE interprets 

‘‘directly from the imposition of the 

standard’’ to include energy used in the 

generation, transmission, and 

distribution of fuels used by appliances. 

In addition, DOE is evaluating the fullfuel-cycle measure, which includes the 

energy consumed in extracting, 

processing, and transporting primary 

fuels. Unlike the energy used for water 

treatment and delivery, both DOE’s 

current accounting of primary energy 

savings and the full-fuel-cycle measure 

are directly linked to the energy used by 

appliances. 

Several interested parties commented 

that DOE’s calculation of energy 

consumption should include the energy 

used in the manufacture, distribution, 

and ultimate recycling of residential 

clothes washers. (AWE, No. 12 at p. 2; 

Joint Comment, No. 15 at p. 6; 

Earthjustice, No. 17 at pp. 9–10) Both 

DOE’s current accounting of primary 

energy savings and the full-fuel-cycle 

measure are directly linked to the 

energy used by appliances. The 

imposition of an energy efficiency 

standard for residential clothes washers 

would not lead directly to energy 

savings in the manufacture, distribution 

and recycling of clothes washers. DOE 

believes that any such savings would be 

both indirect and difficult to determine. 

Thus, DOE did not consider such energy 

use in the NIA pursuant to 42 U.S.C. 

6295(o)(2)(B)(i)(III). 

5. Net Present Value of Consumer 

Benefit 

The inputs for determining the net 

present value (NPV) of the total costs 

and benefits experienced by consumers 

of considered appliances are: (1) Total 

annual installed cost, (2) total annual 

savings in operating costs, and (3) a 

discount factor. DOE calculates net 

savings each year as the difference 

between the base case and each 

standards case in total savings in 

operating costs and total increases in 

installed costs. DOE calculates operating 

cost savings over the life of each 

product shipped during the forecast 

period. 

In calculating the NPV, DOE 

multiplies the net savings in future 

years by a discount factor to determine 

their present value. For today’s direct 

final rule, DOE estimated the NPV of 

appliance 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.32 The discount rates for the 

determination of NPV are in contrast to 

the discount rates used in the LCC 

analysis, which are designed to reflect a 

consumer’s perspective. The 7-percent 

real value is an estimate of the average 

before-tax rate of return to private 

capital in the U.S. economy. The 3- 

percent real value represents the ‘‘social 

rate of time preference,’’ which is the 

rate at which society discounts future 

consumption flows to their present 

value. 

The California Utilities stated that 

because 3 percent is closer to the OMB’s 

current estimated 30-year real discount 

rate, DOE should give primary weight to 

calculations based on the 3-percent real 

rate. (California Utilities, No. 19 at p. 6) 

DOE notes that OMB Circular A–4 

references an earlier Circular A–94, 

which states that a real discount rate of 

7 percent should be used as a base case 

for regulatory analysis. The 7-percent 

rate is an estimate of the average beforetax rate of return on private capital in 

the U.S. economy. It approximates the 

opportunity cost of capital and, 

according to Circular A–94, is the 

appropriate discount rate whenever the 

primary effect of a regulation is to 

displace or alter the use of capital in the 


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private sector. In preparing Circular A– 

4, OMB found that the average rate of 

return on capital remains near the 7- 

percent rate estimated earlier. Circular 

A–4 also states that when a regulation 

primarily and directly affects private 

consumption, a lower discount rate (the 

social rate of time preference) is 

appropriate. It suggests that the real rate 

of return on long-term government debt 

may provide a fair approximation of the 

social rate of time preference, and states 

that during the past 30 years, this rate 

has averaged about 3 percent in real 

terms on a pre-tax basis. Circular A–4 

concludes that ‘‘for regulatory analysis, 

[agencies] should provide estimates of 

net benefits using both 3 percent and 7 

percent.’’ Consistent with the OMB 

guidance, for today’s rule DOE provided 

and considered results derived using 

discount rates of 3 percent and 7 

percent. 

6. Benefits From Effects of Standards on 

Energy Prices 

Reduction in electricity consumption 

associated with amended standards for 

residential clothes washers could 

reduce the electricity prices charged to 

consumers in all sectors of the economy 

and thereby reduce their electricity 

expenditures. 

Commenting on the framework 

document, the California Utilities stated 

that the electricity price mitigation 

effects produced by new standards for 

clothes washers should be documented 

and the value of reduced electricity bills 

to all consumers quantified as a benefit. 

(California Utilities, No. 19 at p. 6) 

For the direct final rule, DOE used 

NEMS–BT to assess the impacts of the 

reduced need for new electric power 

plants and infrastructure projected to 

result from clothes washer standards. In 

NEMS–BT, changes in power generation 

infrastructure affect utility revenue 

requirements, which in turn affect 

electricity prices. DOE estimated the 

impact on electricity prices associated 

with each considered TSL. Although the 

aggregate benefits for electricity users 

are potentially large, there may be 

negative effects on some of the actors 

involved in electricity supply, such as 

actors involved in power plant 

construction and fuel suppliers. Because 

there is uncertainty about the extent to 

which the benefits for electricity users 

from reduced electricity prices would be 

a transfer from actors involved in 

electricity supply to electricity 

consumers, DOE is continuing to 

investigate the extent to which 

electricity price changes projected to 

result from standards represent a net 

gain to society. 

H. Consumer Subgroup Analysis 

In analyzing the potential impact of 

new or amended standards on 

consumers, DOE evaluates the impact 

on identifiable subgroups of consumers 

(e.g., low-income households) that may 

be disproportionately affected by a 

national standard. DOE evaluates 

impacts on particular subgroups of 

consumers primarily by analyzing the 

LCC impacts and PBP for those 

particular consumers from alternative 

standard levels. Chapter 11 in the direct 

final rule TSD describes the consumer 

subgroup analysis. 

In response to the framework 

document, interested parties requested 

that DOE consider a number of 

subgroups for analysis. The Joint 

Comment said that renters and disabled 

homeowners should be considered as 

LCC subgroups. (Joint Comment, No. 15 

at p. 6) AHAM and Whirlpool stated 

that DOE should consider low-income 

households as a consumer subgroup, 

because they are affected by the cost 

increases engendered by efficiency 

increases. (AHAM, No. 24 at p. 3; 

Whirlpool, No. 22 at p. 9) ALS 

supported considering subgroups 

comprising low-income households and 

senior citizens. (ALS, No. 13 at p. 12) 

Whirlpool said that DOE should 

consider a consumer subgroup 

comprising families with young 

children. (Whirlpool, No. 22 at p. 9) 

For this rule, DOE analyzed the 

impacts of the considered standard 

levels on low-income households and 

senior-only households. DOE did not 

examine renters as a subgroup. DOE 

notes that, in most cases, renters pay the 

electricity bill but do not own the 

clothes washer in their home. To some 

extent, the higher cost of a moreefficient clothes washer incurred by the 

building owner would likely be passed 

on to the renter through increased rent. 

Because DOE is not aware of 

information that would allow it to 

reliably assess the extent to which such 

‘‘pass-through’’ would occur, it was not 

able to quantitatively analyze the 

impacts of alternative standard levels on 

renters. DOE did not consider families 

with children as a subgroup. To the 

extent such families have low income, 

they are already included in the analysis 

of low-income households. DOE had no 

information to support the contention 

that families with children would 

otherwise be negatively affected by a 

standard. Lastly, DOE did not have any 

information with which to analyze 

disabled people as a subgroup. 

I. Manufacturer Impact Analysis 

The following sections address the 

various steps taken to analyze the 

impacts of the amended standards on 

manufacturers. These steps include 

conducting a series of analyses, 

interviewing manufacturers, and 

evaluating the comments received from 

interested parties during this 

rulemaking. 

1. Overview 

In determining whether an amended 

energy conservation standard for 

residential clothes washers subject to 

this rulemaking is economically 

justified, DOE is required to consider 

‘‘the economic impact of the standard 

on the manufacturers and on the 

consumers of the products subject to 

such standard.’’ (42 U.S.C. 

6295(o)(2)(B)(i)(I)) The statute also calls 

for an assessment of the impact of any 

lessening of competition as determined 

by the Attorney General that is likely to 

result from the adoption of a standard. 

(42 U.S.C. 6295(o)(2)(B)(i)(V)) DOE 

conducted the MIA to estimate the 

financial impact of amended energy 

conservation standards on 

manufacturers, and to assess the 

impacts of such standards on 

employment and manufacturing 

capacity. 

The MIA is both a quantitative and 

qualitative analysis. The quantitative 

part of the MIA relies on the 

Government Regulatory Impact Model 

(GRIM), an industry cash-flow model 

customized for the residential clothes 

washers covered in this rulemaking. See 

section IV.I.2 below, for details on the 

GRIM analysis. The qualitative part of 

the MIA addresses factors such as 

product characteristics, characteristics 

of particular firms, and market trends. 

The complete MIA is discussed in 

chapter 12 of the direct final rule TSD. 

DOE conducted the MIA in the three 

phases described below. 

a. Phase 1, Industry Profile 

In Phase 1 of the MIA, DOE prepared 

a profile of the residential clothes 

washer industry based on the market 

and technology assessment prepared for 

this rulemaking. Before initiating the 

detailed impact studies, DOE collected 

information on the present and past 

market structure and characteristics of 

the industry, tracking trends in market 

share, product attributes, product 

shipments, manufacturer markups, and 

the cost structure for various 

manufacturers. 

The profile also included a top-down 

analysis of manufacturers in the 

industry using Security and Exchange 


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33Available online at www.sec.gov. 

34Available online at 

www2.standardandpoors.com. 

Commission 10–K filings,33 Standard & 

Poor’s stock reports,34 and corporate 

annual reports released by both public 

and privately held companies. DOE 

used this and other publicly available 

information to derive preliminary 

financial inputs for the GRIM (e.g., 

revenues, cost of goods sold, 

depreciation, SG&A, and research and 

development (R&D) expenses). 

b. Phase 2, Industry Cash Flow Analysis 

Phase 2 focused on the financial 

impacts of potential amended energy 

conservation standards on the industry 

as a whole. Amended energy 

conservation standards can affect 

manufacturer cash flows in three 

distinct ways: (1) By creating a need for 

increased investment, (2) by raising 

production costs per unit, and (3) by 

altering revenue due to higher per-unit 

prices and/or possible changes in sales 

volumes. DOE used the GRIM to model 

these effects in a cash-flow analysis of 

the residential clothes washer industry. 

In performing this analysis, DOE used 

the financial values derived during 

Phase 1 and the shipment assumptions 

from the NIA. 

c. Phase 3, Sub-Group Impact Analysis 

Using average cost assumptions to 

develop an industry-cash-flow estimate 

may not adequately assess differential 

impacts of amended energy 

conservation standards among 

manufacturer subgroups. For example, 

small businesses, manufacturers of 

niche products, or companies exhibiting 

a cost structure that differs significantly 

from the industry average could be more 

negatively affected. During the 

manufacturer interviews, DOE 

discussed financial topics specific to 

each manufacturer and obtained each 

manufacturer’s view of the industry as 

a whole. DOE reports the MIA impacts 

of amended energy conservation 

standards by grouping together the 

impacts on manufacturers of certain 

product classes. While DOE did not 

identify any other subgroup of 

manufacturers of residential clothes 

washers that would warrant a separate 

analysis, DOE specifically investigated 

impacts on small business 

manufacturers. See section VI.B for 

more information. 

The MIA also addresses the direct 

employment impacts in manufacturing 

of clothes washers. DOE uses census 

data and information gained through 

manufacturer interviews in conjunction 

with the GRIM to estimate the domestic 

labor expenditures and number of 

domestic production workers in the 

base case and at each TSL from 2011 to 

2044. 

2. GRIM Analysis 

DOE uses the GRIM to quantify the 

changes in cash flow that result in a 

higher or lower industry value. The 

GRIM analysis is a standard, annual 

cash-flow analysis that incorporates 

manufacturer costs, markups, 

shipments, and industry financial 

information as inputs, and models 

changes in costs, distribution of 

shipments, investments, and 

manufacturer margins that could result 

from amended energy conservation 

standards. The GRIM spreadsheet uses 

the inputs to arrive at a series of annual 

cash flows, beginning with the base year 

of the analysis, 2011 (which accounts 

for the investments needed to bring 

products into compliance), and 

continuing to 2044. DOE calculated 

INPVs by summing the stream of annual 

discounted cash flows during this 

period. DOE uses the industry average 

weighted average cost of capital (WACC) 

of 8.5 percent, as this represents the 

minimum rate of return necessary to 

cover the debt and equity obligations 

manufacturers use to finance operations. 

DOE used the GRIM to compare INPV 

in the base case with INPV at various 

TSLs (the standards cases). The 

difference in INPV between the base and 

standards cases represents the financial 

impact of the amended standard on 

manufacturers. DOE collected this 

information from a number of sources, 

including publicly available data and 

interviews with a number of 

manufacturers. Additional details about 

the GRIM can be found in chapter 12 of 

the direct final rule TSD. 

a. GRIM Key Inputs 

Manufacturer Production Costs 

Changes in the manufacturer 

production costs (MPCs) of residential 

clothes washers can affect revenues, 

gross margins, and cash flow of the 

industry, making these product cost 

data key GRIM inputs for DOE’s 

analysis. DOE used the MPCs calculated 

in the engineering analysis for each 

efficiency level, as described in section 

IV.C above, and further detailed in 

chapter 5 of the direct final rule TSD. 

DOE used the AHAM data submittal to 

determine the MPCs at most efficiency 

levels for top-loading and front-loading 

standard product classes. To 

supplement the AHAM submittal and 

calculate max-tech MPCs for these 

product classes, DOE also conducted 

product tear downs to generate MPCs 

using a manufacturing cost model. DOE 

created separate cost curves for toploading and front-loading compact 

product classes using data from teardowns to develop baseline MPCs and 

applied the incremental costs that 

correspond to the proposed design 

options from the standard product 

classes. The cost model also 

disaggregated the MPCs into material, 

labor, overhead, and depreciation. 

Base-Case Shipments Forecast 

The GRIM estimates manufacturer 

revenues based on total unit shipment 

forecasts and the distribution of these 

values by efficiency level and product 

class. Changes in the efficiency mix at 

each standard level affect manufacturer 

finances. For this analysis, the GRIM 

uses the NIA shipments forecasts from 

2011 to 2044, the end of the analysis 

period. 

To calculate shipments, DOE 

developed a single shipment model for 

all residential clothes washers and 

disaggregated total shipments into frontloading and top-loading clothes 

washers, and assigned shipments to 

both the standard and compact product 

classes. In the base case, DOE forecasted 

change in market share of each product 

class by utilizing historical shipments 

data submitted by AHAM. 

Product and Capital Conversion Costs 

Amended energy conservation 

standards will cause manufacturers to 

incur conversion costs to bring their 

production facilities and product 

designs into compliance. For the MIA, 

DOE classified these 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 noncapitalized costs focused on making 

product designs comply with the 

amended energy conservation standard. 

Capital conversion costs are investments 

in property, plant, and equipment to 

adapt or change existing production 

facilities so that new product designs 

can be fabricated and assembled. 

DOE based the conversion cost 

estimates required to meet each TSL on 

the AHAM data submittal for all 

product classes. Using the AHAM data 

submittal for both the product and 

capital conversion costs ensures that the 

costs required to meet amended energy 

conservation standards are consistent 

with the incremental costs to reach 

those efficiencies. DOE validated these 

costs in manufacturer interviews and 

through the product teardown analysis. 

At each top-loading and front-loading 

standard efficiency level, DOE matched 


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the IMEF efficiency level to the 

corresponding MEF metric and used the 

aggregated total industry capital and 

product conversion cost from the May 

2010 AHAM submittal. DOE multiplied 

each aggregated capital and product 

conversion total for these product 

classes by 1.05 to account for the nonAHAM member shipments. For the new 

max-tech levels revised using the 

AHAM data submittal, DOE scaled the 

aggregated total conversion costs at the 

next lowest efficiency level by the same 

percentage increase in production costs. 

DOE did not increase the required 

product and capital conversion costs for 

efficiency levels that do not contribute 

to a change in active mode efficiency to 

ensure that the costs required are 

consistent with the incremental costs to 

meet amended energy conservation 

standards and because, as described in 

section IV.C.3, the standby power 

technology options would require 

minimal product development. 

For the top-loading compact product 

class, DOE scaled the top-loading 

standard conversion costs for the same 

efficiency level by the relative number 

of compact platforms. DOE did not 

include conversion costs for the frontloading compact product classes 

because the design options analyzed to 

improve efficiency would require 

minimal changes to baseline products. 

DOE took a number of steps to 

analyze the conversion costs in the 

AHAM data submittal. DOE reviewed 

the AHAM conversion costs during 

manufacturer interviews to understand 

the magnitude and cost of the required 

conversions for individual 

manufacturers. DOE also reviewed 

public information in the CEC, ENERGY 

STAR, and CEE product databases as 

well as manufacturer Web sites to 

understand which product lines 

manufacturers would need to upgrade at 

each efficiency level. DOE also reviewed 

the AHAM submittal in conjunction 

with the technology options and 

information learned during product 

teardowns for multiple product lines. 

DOE’s estimates of the total capital 

conversion and production conversion 

costs by TSL can be found in section 

V.B.2 of today’s direct final rule. The 

estimates of the total capital conversion 

and product conversion costs by 

product class and efficiency level can be 

found in chapter 12 of the direct final 

rule TSD. 

b. GRIM Scenarios 

Standards-Case Shipment Forecasts 

The MIA results presented in section 

V.B.2 all use shipments from the 

reference NIA scenario in the GRIM. To 

determine efficiency distributions in the 

standards case for the reference NIA 

scenario, DOE analyzed the roll-up 

scenario. In this scenario, DOE assumed 

that product efficiencies in the base case 

that did not meet the standard would 

roll up to meet the new standard in the 

compliance year. See section IV.G.2 for 

a description of the standards case 

efficiency distribution. For standardscase shipments, DOE used a relative 

price elasticity that considers the 

possibility of higher first costs lowering 

total shipments. The reference NIA 

scenario also accounted for cross-price 

elasticity between top-loading and frontloading products to analyze the 

respective market share of each product 

class as prices change relative to one 

another. 

The reference NIA scenario used 

historical data to derive a price scaling 

index to forecast product costs. The 

MPCs and MSPs in the GRIM use the 

default price forecast for all scenarios. 

See section IV.G.4 for a discussion of 

DOE’s price forecasting methodology. 

Markup Scenarios 

MSP is equal to MPC times a 

manufacturer markup. The MSP 

includes direct manufacturing 

production costs (i.e., labor, material, 

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 baseline 

manufacturer markup, DOE evaluated 

publicly available financial information 

for manufacturers of major household 

appliances whose product offerings 

include residential clothes washers. 

DOE also received feedback supporting 

the 1.22 baseline manufacturer markup 

during manufacturer interviews. In the 

base case for all three GRIM markup 

scenarios, DOE assumed that the 

products that meet the January 2011 

ENERGY STAR criteria earn a 

moderately higher manufacturer markup 

than ‘‘baseline’’ products that fall below 

those efficiencies. Additionally, 

products that meet the CEE Tier 2 and 

Tier 3 criteria earn an incrementally 

higher markup than those that meet the 

2011 ENERGY STAR criteria. 

For the MIA, DOE modeled three 

standards-case markup scenarios to 

represent the uncertainty regarding the 

potential impacts on prices and 

profitability for manufacturers following 

the implementation of amended energy 

conservation standards: (1) A no 

commoditization markup scenario, (2) a 

tiered markup scenario, and (3) and a 

tiered markup with margin pressure 

scenario. Modifying these markups from 

the base case to the standards cases 

yields different sets of impacts on 

manufacturers’ changing industry 

revenue and cash flow. 

The no commoditization scenario 

assumes that the base-case markup 

structure (with baseline, ENERGY 

STAR, and CEE Tier 2 and Tier 3 

markups) is maintained in the standards 

case. This scenario represents the upper 

bound of industry profitability because 

manufacturers are able to fully pass 

through additional costs from amended 

standards to their customers. In addition 

to fully passing through higher 

production costs, manufacturers 

continue to earn premium markups after 

standards for products that are no longer 

differentiated by the ENERGY STAR 

and CEE programs. 

The tiered markup scenario also starts 

with the three different product 

markups in the base case (baseline, 

ENERGY STAR, and CEE Tier 2 and 

Tier 3 markups). In the standards case, 

the tiered markup scenario considers 

the situation in which the breadth of a 

manufacturer’s portfolio of products 

shrinks and amended standards result 

in higher-tier products moving to lower 

tiers. As a result, higher efficiency 

products that previously commanded 

the ENERGY STAR and CEE Tier 2 and 

Tier 3 markups are assigned the 

ENERGY STAR and baseline markups, 

respectively. This scenario models a 

reduction in markups that 

manufacturers may experience as 

standards increase and reflects one of 

the industry’s key concerns about 

product commoditization at higher 

efficiency levels as efficiency 

differentiators are eliminated. 

DOE also modeled a lower bound 

profitability scenario. In the tiered 

markup with margin pressure scenario, 

the markups of products that exceed the 

minimum energy conservation 

standards similarly move to lower 

efficiency tiers as standards eliminate 

current efficiency differentiators. In this 

scenario, the manufacturer markups at 

the new minimum standard are also 

lowered. For both top-loading and frontloading clothes washers, manufacturers 

are able to maintain only the operating 

profit of the baseline product in 

absolute dollars. For products at the 

new minimum energy conservation 

standards, the higher production costs 

and the investments required to comply 

with the amended energy conservation 

standard do not yield additional 

operating profit. This scenario models 

concerns that higher production costs 

for minimally compliant products could 

greatly hurt manufacturer profitability 

because a large segment of the market is 

greatly impacted by increases in first 

costs and there would be tremendous 


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32350 Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 

pressure to keep entry level products 

close to today’s prices. 

3. Discussion of Comments 

During the framework public meeting, 

interested parties commented on the 

assumptions and results of the 

manufacturer impacts presented in the 

framework document. Commenters 

discussed several topics, including the 

cumulative regulatory burden on 

manufacturers, manufacturer tax credits, 

and manufacturer subgroups. DOE 

addresses these comments below. 

a. Cumulative Regulatory Burden 

DOE requested comment in the 

framework document on other 

regulations that it should consider in its 

examination of cumulative regulatory 

burden. DOE received a number of 

comments from interested parties. 

AHAM stated that the International 

Association of Plumbing and 

Manufacturing Officials (IAPMO) 

recently released a draft version of ‘‘The 

Green Plumbing and Mechanical Model 

Supplement’’ for comment. The draft 

suggests that local municipalities may 

adopt a requirement for a WF of 5.0 or 

less. AHAM commented that if this 

proposal moves forward, it will 

introduce substantial additional 

regulatory burden for clothes washer 

manufacturers, as these requirements 

are substantially lower than 2011 

ENERGY STAR levels. (AHAM, No. 15 

at p. 5) Whirlpool stated that the 

proliferation of green building standards 

from entities such as the U.S. Green 

Building Council (USGBC), EPA, 

National Association of Home Builders 

(NAHB), and now IAPMO, creates an 

additional burden on manufacturers. 

(Whirlpool, No. 22 at p. 7) Conversely, 

ASAP argued that the IAPMO 

specifications referred to by AHAM are 

voluntary codes that local communities 

can consider. (ASAP, Public Meeting 

Transcript, No. 7 at p. 96) ASAP also 

commented that misapplying voluntary 

criteria in an attempt to write local 

standards is a hazard regardless of 

efficiency standards. (ASAP, Public 

Meeting Transcript, No. 7 at p. 96) 

AHAM and GE stated that CEE Tiers 

continue to be raised in response to 

DOE standards levels, and local 

municipalities may require a CEE Tier 

rating for various incentives. In general, 

CEE Tiers are some percentage of a DOE 

standard and do not have strong data to 

support the levels. AHAM and GE 

commented that CEE Tiers may push 

the technology beyond practical 

performance and/or price points. 

(AHAM, No. 16 at p. 5; AHAM, Public 

Meeting Transcript, No. 7 at p. 95; GE, 

No. 20 at p. 1) ASAP commented that 

DOE is concerned with outside 

regulatory changes, and the CEE Tiers 

Program is not a regulatory program. 

(ASAP, Public Meeting Transcript, No. 

7 at p. 96) 

For the cumulative regulatory burden, 

DOE attempts to quantify or describe the 

impacts of other Federal regulations that 

have a compliance date within 

approximately three years of the 

compliance date of this rulemaking. 

While DOE describes voluntary 

programs that influence the efficiency of 

clothes washers in the cumulative 

burden and acknowledges that these 

programs can impact the product 

offerings of residential clothes washer 

manufacturers, DOE does not quantify 

the costs to comply with future 

voluntary programs because they are 

outside the scope of the cumulative 

regulatory burden. DOE notes that a WF 

of 5.0 or less considered by IAPMO 

corresponds to the front-loading 

standard size standards in the direct 

final rule and in the Joint Petition for 

2015. DOE also notes that 42 U.S.C. 

6297 describes EPCA’s preemption of 

state and local regulation of appliance 

efficiency, including such requirements 

in State or local building codes. 

ALS commented on the cumulative 

regulatory burden of the Restriction of 

Hazardous Substances (RoHS) Directive 

already existing in Europe and similar 

legislation that has been proposed in 

some states in the United States. (ALS, 

No. 13 at p. 12) Whirlpool stated that 

DOE should consider the increasing 

regulation of materials and RoHS 

proposals in its analysis of residential 

clothes washers. (Whirlpool, No. 22 at 

p. 7) AHAM commented that RoHS, and 

other hazardous substance issues are 

substantial regulatory burdens that are 

accumulating on manufacturers. 

(AHAM, Public Meeting Transcript, No. 

7 at p. 165) 

Most manufacturers of residential 

clothes washers that sell products in the 

United States also sell products in the 

European Union and must comply with 

the RoHS directive for those products 

sold in the European Union. While the 

potential restrictions of other hazardous 

substances and the potential for states to 

implement similar bans are also 

concerns for manufacturers, there is 

currently no corresponding Federal ban 

on many of the substances found in the 

RoHS directive. Therefore, DOE does 

not account for RoHS compliance costs 

in its calculation of product conversion 

costs. 

AHAM stated that EPA is requiring 

the transition away from 

hydrochlorofluorocarbons (HCFCs), a 

shift to which the home appliance 

industry must devote resources. 

(AHAM, Public Meeting Transcript, No. 

7 at p. 165) In response, DOE notes that 

residential clothes washers do not use 

HCFCs, and none of the design options 

analyzed by DOE would require changes 

to clothes washers due to the EPA 

phase-out. 

Several manufacturers commented on 

the burden imposed by UL standards. 

ALS stated that a cumulative regulatory 

burden is imposed by the revision of UL 

Standard 2158 for clothes dryer safety, 

which requires fire containment test 

compliance by March 20, 2013. (ALS, 

No. 13 at p. 12) Whirlpool is concerned 

with the cumulative regulatory burden 

of new UL standards on entrapment for 

both clothes washers and dishwashers, 

new UL fire containment standards for 

clothes dryers, and a number of other 

safety standards for both products and 

components that are propagated by UL. 

(Whirlpool, No. 22 at p. 7) AHAM stated 

that there are several UL safety and 

functional standards that draw 

resources from manufacturers. BSH 

stated that UL 2157 and UL 2158 have 

been revised and present a regulatory 

burden to laundry appliance 

manufacturers. (BSH, No. 11 at p. 5) 

Miele stated that UL 2157 may require 

redesign of door lock mechanisms to 

prevent child entrapment, and that a 

similar effort is underway for 

dishwashers. UL 2158 was just revised, 

which, according to Miele will also 

cause a major redesign for fire 

containment in clothes dryer 

manufacturers. (Miele, Public Meeting 

Transcript, No. 7 at p. 165) 

In the clothes dryer rulemaking, DOE 

accounted for the conversion costs for 

manufacturers to comply with the 

revisions to UL 2158 as mentioned in 

the comments from interested parties. 

DOE notes that the UL 2157 and 2158 

are not Federal regulations. In contrast 

to the RoHS Directive requirements 

discussed previously, UL certification is 

a de facto requirement for selling 

products in the U.S. because many local 

building codes require all installed 

products to meet safety regulations. 

DOE has included the UL certification 

costs for both UL 2157 and UL 2158 as 

a sensitivity scenario in the GRIM, but 

does not include the UL conversion 

costs in the main MIA results. Refer to 

chapter 12 of the direct final rule TSD 

for more information about how DOE 

calculated the UL conversion costs. 

AHAM, ALS, GE, and Whirlpool 

stated that the existing DOE 

rulemakings for commercial clothes 

washer and residential clothes dryer 

minimum standards represent a 

cumulative regulatory burden. Some of 

these commenters added that the DOE 

refrigerator and room air conditioner 


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rulemaking result in additional 

regulatory burdens. (AHAM, No. 16 at p. 

6; AHAM, Public Meeting Transcript, 

No. 7 at p. 96; ALS, No. 13 at p. 12; GE, 

No. 20 at p. 1; Whirlpool, No. 22 at 

p. 7) 

DOE agrees that these rulemakings are 

a part of the cumulative regulatory 

burden on manufacturers. DOE has 

attempted to quantify the impact of the 

other DOE energy conservation 

standards that have a compliance date 

within approximately three years of the 

compliance date of this rulemaking in 

chapter 12 of the direct final rule TSD. 

AHAM added that cumulative 

regulatory burden is made even more 

demanding by the current economic 

conditions, and this rulemaking should 

explicitly consider cumulative 

regulatory impact in the economic 

justification analysis. (AHAM, Public 

Meeting Transcript, No. 7 at p. 96) PG&E 

stated that its understanding is that DOE 

compares the standards-case impacts to 

the base-case impacts, so that events 

such as the recession and other 

regulatory burdens that are independent 

of this rulemaking would not be 

considered. (PG&E, Public Meeting 

Transcript, No. 7 at p. 167) ASAP 

questioned how DOE intends to deal 

with the effects of the economic 

downturn and the potential recovery on 

shipment forecasts, and whether there is 

some sort of consistent approach DOE is 

considering with its other rulemakings. 

(ASAP, Public Meeting Transcript, No. 

7 at p. 101) 

DOE considers the cumulative 

regulatory burden on manufacturers as 

part of its statutory criteria to justify any 

energy conservation standard—the 

economic impact on manufacturers and 

consumers (42 U.S.C. 6295(o)(2)(B)(i)). 

DOE considers the cumulative 

regulatory burden in the qualitative part 

of its MIA analysis, though it attempts 

to quantify the cumulative regulatory 

burden whenever possible. In the MIA, 

DOE also modeled the impacts of 

amended energy conservation standards 

on residential clothes washer 

manufacturers from base year to the end 

of the analysis period (2011–2044). DOE 

used the most current information that 

is publicly available in many of its 

estimates and analyses, inputs that take 

the current economic downturn into 

consideration. For example, DOE used 

financial parameters like standard R&D 

to model the cash-flow impacts on the 

industry. To calculate the estimates of 

the financial parameters used in the 

GRIMs, DOE examined the latest six 

years of SEC 10–K data. These estimates 

were meant to reflect the parameters 

that are representative of each industry 

over the long-term and are not 

specifically attributable to current 

economic conditions. 

As in other rulemakings, DOE used 

AHAM data for historical shipments. 

That data reflects the economic 

downturn for residential products 

including clothes washers. DOE also 

considers standards-case impacts with 

respect to the base case as part of the 

NIA (see section IV.G.2). 

b. Manufacturer Tax Credits 

DOE requested input on any ‘‘market 

pull’’ programs, such as manufacturer 

tax credits, that promote the adoption of 

more efficient residential clothes 

washers. 

ASAP stated that DOE should find an 

effective way to address the effects of 

manufacturer tax incentives on 

conversion costs and the production 

credits available under current law for 

the production of high efficiency 

machines. (ASAP, Public Meeting 

Transcript, No. 7 at p. 83) The Joint 

Comment stated that DOE must fully 

account for the effects of Federal 

production tax credits in the MIA. 

Federal production tax credits for 

manufacturers of high efficiency 

appliances, including residential clothes 

washers, were first enacted in 2005 and 

then extended and expanded in 2008. 

The Joint Comment further stated that 

production tax credits provided 

manufacturers with a substantial 

incentive to continue to increase 

production of efficient front-loaders and 

top-loaders through 2010. According to 

the Joint Comment, these tax credits 

should substantially off-set the 

conversion capital requirements and 

product conversion expenses of meeting 

higher standards that are key inputs to 

the MIA. (Joint Comment, No. 15 at p. 

7) Earthjustice commented that it would 

seem inconsistent to consider the tax 

credits for purposes of the MIA, and not 

to also consider that the tax credits may 

have an impact on the price of the 

product. (Earthjustice, Public Meeting 

Transcript, No. 7 at p. 83) SCE 

questioned whether DOE captures any 

positive manufacturer impacts due to 

the standards rulemaking. (SCE, Public 

Meeting Transcript, No. 7 at p. 166) 

DOE considers all relevant 

manufacturer impacts, both positive and 

negative. For example, DOE’s analysis 

includes the effects of any manufacturer 

production tax credits that may benefit 

certain manufacturers. ASAP and the 

Joint Comment above refer to tax credits 

that applied to residential clothes 

washers. However, these tax credits 

expired in 2010. Because 2011 is the 

base year to which industry cash flows 

are discounted on this rulemaking, any 

Federal production tax credits received 

by the industry fall outside of the 

analysis period and are not considered 

in the INPV analysis. While there are tax 

credits in proposed legislation, DOE is 

not aware of any existing Federal 

production tax credits that would 

substantially offset the required 

conversion costs for manufacturers. 

Federal production tax credits and other 

market pull programs such as ENERGY 

STAR and the CEE Tiers have helped 

spur the development and acceptance of 

more efficient products which DOE has 

accounted for in the market distribution 

of current products in the base case. 

However, such tax credits and other 

market pull programs would not 

substantially defray the capital 

conversion costs required if all products 

were required to meet the given 

efficiency. 

c. Manufacturer Subgroups 

DOE requested comment on 

appropriate manufacturer subgroups, if 

any, that DOE should consider in its 

manufacturer subgroup analysis for 

residential clothes washers. ALS 

suggested that low-volume 

manufacturers with less than 5 percent 

market share, including itself, be 

considered a manufacturer subgroup. 

(ALS, No. 13 at p. 12) ALS also stated 

that it is a highly leveraged small 

company that doesn’t have the resources 

that the three major residential clothes 

washer manufacturers do. (ALS, Public 

Meeting Transcript, No. 7 at p. 165) 

AHAM stated that smaller niche 

manufacturers should be considered as 

a manufacturer subgroup. AHAM 

commented that these manufacturers 

often have less access to the newer 

technologies, and, in this economic 

climate, have fewer resources available 

for research and development of 

products. (AHAM, Public Meeting 

Transcript, No. 7 at p. 163) Whirlpool 

stated that it is unaware of any 

manufacturer subgroups that would be 

impacted differently from other 

manufacturers under this rulemaking. 

(Whirlpool, No. 22 at p. 10) 

In the commercial clothes washers 

(CCW) final rule, DOE described the 

disproportionate impacts on the Low 

Volume Manufacturer (LVM) in the 

NOPR and TSD. DOE considered this 

manufacturer to be low-volume because 

its annual shipments in the combined 

residential and CCW market were 

significantly lower than those of its 

larger competitors. However, unlike its 

larger rivals, most of the LVM’s unit 

shipments were in the CCW market, 

where the LVM had significant market 

share. Historically, this company 

derived 22 percent of its total revenue 

from the sale of front- and top-loading 


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clothes washers and 87 percent of that 

revenue was from the commercial 

market. As a result, DOE believed that 

the LVM could be affected 

disproportionately by any rulemaking 

concerning CCWs compared to its 

competitors, for whom CCWs represent 

less than 2 percent of total clothes 

washer sales. 75 FR 1122, 1137 (Jan. 8, 

2010). However, DOE does not believe 

that a Low Volume subgroup is 

warranted for residential clothes 

washers because the CCW LVM has a 

small presence in the residential clothes 

washer market and residential clothes 

washers represent a small portion of 

overall clothes washer sales and a 

smaller portion of total revenue. DOE 

also notes that ALS, AHAM, and many 

other manufacturers signed the Joint 

Petition that included residential 

clothes washer standards identical to 

those in today’s direct final rule. DOE 

also describes the potential impacts on 

the small business manufacturer it 

identified in section VI.B but does not 

report impacts on any other subgroups 

of manufacturers. 

d. Miscellaneous 

ASAP asked whether and how 

overseas manufacturers are engaged in 

the manufacturer interview process. 

(ASAP, Public Meeting Transcript, No. 

7 at p. 108) 

DOE invited as many domestic and 

international clothes washer 

manufacturers that sell products in the 

U.S. as it could identify to participate in 

the rulemaking process. DOE considered 

inputs from and interviewed the two 

international manufacturers that 

responded to its requests for 

participation. DOE notes that one of 

these manufacturers has domestic 

production. 

4. Manufacturer Interviews 

DOE interviewed manufacturers 

representing more than 80 percent of 

residential clothes washer sales. These 

interviews were in addition to those 

DOE conducted as part of the 

engineering analysis. DOE used these 

interviews to tailor the GRIM to 

incorporate unique financial 

characteristics of the industry. All 

interviews provided information that 

DOE used to evaluate the impacts of 

potential amended energy conservation 

standards on manufacturer cash flows, 

manufacturing capacities, and 

employment levels. See appendix 12–A 

of the direct final rule TSD for 

additional information on the MIA 

interviews. The following sections 

describe the most significant issues 

identified by manufacturers. 

a. Potentially Large Conversion Costs 

Manufacturers indicated that they 

were greatly concerned about the 

potential for this rulemaking to require 

significant product and capital 

conversion costs. Introducing new 

residential clothes washer platforms 

involves very large upfront costs. These 

capital and product development costs 

can be justified because a basic platform 

typically undergoes incremental 

changes over a number design cycles 

and the initial investment can be at least 

partially spread over all these 

shipments. Many of the existing 

residential clothes washer platforms 

have some designs options available 

that would necessitate only these 

incremental types of changes. 

Substantially higher efficiencies, 

however, could potentially necessitate a 

drum or cabinet capacity change. In this 

case, rather than requiring alteration of 

the current platform, the required 

changes would likely require design of 

a completely new platform. A new 

platform would require replacing most 

production equipment at a very large 

capital cost. Manufacturers also 

indicated that these initial costs for a 

new basic platform could result in a 

substantial shift in employment. Some 

manufacturers were also concerned that 

devoting resources to efficiency 

improvements could hurt their products 

in the market because these efforts 

could come at the expense of other 

features. 

b. Product Classes 

Manufacturers were divided on the 

need to retain top-loading and frontloading standard-size product classes. In 

general, manufacturers who produce 

top-loading clothes washers favored 

retaining the two distinct product 

classes. Manufacturers who produce 

only front-loading clothes washers were 

less concerned with maintaining the 

method of access as a product class 

distinction. 

While all manufacturers agreed frontloading clothes washers are an 

important product offering, many 

manufacturers also stated that toploading clothes washers are an 

important option for consumers because 

they have lower cycle times, lower price 

points, lower installation costs because 

they do not require a pedestal, are easier 

to load, are easier to add garments midcycle, and have less vibration. Some 

manufacturers in favor of maintaining 

the separate product classes also stated 

that eliminating top-loading clothes 

washers would harm lower-income 

customers who typically purchase 

baseline clothes washers. In addition, 

because front-loading clothes washers 

are mature in the marketplace, 

consumers are aware of the benefits of 

top-loading clothes washers, high 

efficiency top-loading products, and 

front-loading clothes washers and have 

the ability to choose higher efficiency 

products in either configuration. 

c. Wash Performance 

Manufacturers were concerned that 

efficiency gains over time have limited 

the potential to improve efficiency 

without negatively impacting wash 

performance (and the consumer). Many 

manufacturers were concerned that a 

test procedure that did not take a 

minimum wash performance into 

consideration, coupled with a more 

stringent energy conservation standard, 

could force manufacturers to limit water 

to a level that would harm consumers. 

For example, over-sudsing could be 

more commonplace. Also, water levels 

could be reduced to the point where 

cold water would no longer sufficiently 

clean clothes. Either one of these issues 

would result in lost energy savings as 

consumers either rewashed clothes or 

no longer selected cold water wash 

cycles. Consequently, many 

manufacturers supported adding a 

performance metric to the test 

procedure to ensure that consumers 

would genuinely benefit from improved 

efficiency. 

d. Tub Capacity Measurement 

Many manufacturers mentioned that 

different companies use inconsistent 

approaches in measuring tub capacity. 

While manufacturers offered slightly 

different suggestions for how to measure 

capacity, most were supportive of 

eliminating the ambiguity. 

Manufacturers hoped this issue would 

be resolved before the implementation 

of these amended energy conservation 

standards because the modified energy 

factor and water factor calculations are 

dependent on measured capacity. 

e. ENERGY STAR 

Manufacturers stated that the 

ENERGY STAR program is also a part of 

their overall energy strategy. To be 

competitive, many manufacturers must 

take ENERGY STAR levels into 

consideration when designing new 

clothes washers. One manufacturer 

mentioned that the costs associated with 

designing new products to meet 

ENERGY STAR levels were not reflected 

in DOE’s incremental cost tables. 

Another manufacturer mentioned that 

ENERGY STAR is an important 

purchasing decision, especially in the 

front-loading clothes washer market. 

The manufacturer expressed concern 


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35See Bureau of Economic Analysis, Regional 

Multipliers: A User Handbook for the Regional 

Input-Output Modeling System (RIMS II). 

Washington, DC. U.S. Department of Commerce, 

1992. 

that standards that are too aggressive 

could put the future of the ENERGY 

STAR program for residential clothes 

washers in jeopardy. In turn, that could 

impact local rebates that enable 

manufacturers to offer products that 

meet the minimum efficiency standards. 

J. Employment Impact Analysis 

DOE considers employment impacts 

in the domestic economy as one factor 

in selecting a proposed standard. 

Employment impacts include direct and 

indirect impacts. Direct employment 

impacts are any changes in the number 

of employees of manufacturers of the 

products subject to standards, their 

suppliers, and related service firms. The 

MIA addresses those impacts. Indirect 

employment impacts are changes in 

national employment that occur due to 

the shift in expenditures and capital 

investment caused by the purchase and 

operation of more efficient appliances. 

Indirect employment impacts from 

standards consist of the jobs created or 

eliminated in the national economy, 

other than in the manufacturing sector 

being regulated, due to: (1) Reduced 

spending by end users on energy; (2) 

reduced spending on new energy supply 

by the utility industry; (3) increased 

consumer spending on the purchase of 

new products; and (4) the effects of 

those three factors throughout the 

economy. 

One method for assessing the possible 

effects on the demand for labor of such 

shifts in economic activity is to compare 

sector employment statistics developed 

by the Labor Department’s Bureau of 

Labor Statistics (BLS). BLS regularly 

publishes its estimates of the number of 

jobs per million dollars of economic 

activity in different sectors of the 

economy, as well as the jobs created 

elsewhere in the economy by this same 

economic activity. Data from BLS 

indicate that expenditures in the utility 

sector generally create fewer jobs (both 

directly and indirectly) than 

expenditures in other sectors of the 

economy.35 There are many reasons for 

these differences, including wage 

differences and the fact that the utility 

sector is more capital-intensive and less 

labor-intensive than other sectors. 

Energy conservation standards have the 

effect of reducing consumer utility bills. 

Because reduced consumer 

expenditures for energy likely lead to 

increased expenditures in other sectors 

of the economy, the general effect of 

efficiency standards is to shift economic 

activity from a less labor-intensive 

sector (i.e., the utility sector) to more 

labor-intensive sectors (e.g., the retail 

and service sectors). Thus, based on the 

BLS data alone, DOE believes net 

national employment may increase 

because of shifts in economic activity 

resulting from amended standards for 

clothes washers. 

For the standard levels considered in 

today’s direct final rule, DOE estimated 

indirect national employment impacts 

using an input/output model of the U.S. 

economy called Impact of Sector Energy 

Technologies version 3.1.1 (ImSET). 

ImSET is a special-purpose version of 

the ‘‘U.S. Benchmark National InputOutput’’ (I–O) model, which was 

designed to estimate the national 

employment and income effects of 

energy-saving technologies. The ImSET 

software includes a computer-based I–O 

model having structural coefficients that 

characterize economic flows among the 

187 sectors. ImSET’s national economic 

I–O structure is based on a 2002 U.S. 

benchmark table, specially aggregated to 

the 187 sectors most relevant to 

industrial, commercial, and residential 

building energy use. DOE notes that 

ImSET is not a general equilibrium 

forecasting model. Given the relatively 

small change to expenditures due to 

energy conservation standards and the 

resulting small changes to employment, 

however, DOE believes that the size of 

any forecast error caused by using 

ImSET will be small. 

For more details on the employment 

impact analysis, see chapter 13 of the 

direct final rule TSD. 

K. Utility Impact Analysis 

The utility impact analysis estimates 

several important effects on the utility 

industry of the adoption of new or 

amended standards. For this analysis, 

DOE used the NEMS–BT model to 

generate forecasts of electricity 

consumption, electricity generation by 

plant type, and electric generating 

capacity by plant type, that would result 

from each TSL. DOE obtained the 

energy savings inputs associated with 

efficiency improvements to considered 

products from the NIA. DOE conducts 

the utility impact analysis as a scenario 

that departs from the latest AEO 

Reference case. In the analysis for 

today’s rule, the estimated impacts of 

standards are the differences between 

values forecasted by NEMS–BT and the 

values in the AEO2010 Reference case. 

As part of the utility impact analysis, 

DOE used NEMS–BT to assess the 

impacts on electricity prices of the 

reduced need for new electric power 

plants and infrastructure projected to 

result from the considered standards. In 

NEMS–BT, changes in power generation 

infrastructure affect utility revenue 

requirements, which in turn affect 

electricity prices. DOE estimated the 

change in electricity prices projected to 

result over time from each TSL. For 

further discussion, see section IV.G.5. 

For more details on the utility impact 

analysis, see chapter 14 of the direct 

final rule TSD. 

In the framework document, DOE 

requested comment on the utility 

impact analysis, and in response 

received several comments from 

efficiency advocates and utilities. The 

California Utilities recommended that 

DOE evaluate how the standard will 

affect water and wastewater utilities, 

including their water infrastructure 

requirements. (California Utilities, No. 

19 at p. 6) The Joint Comment stated 

that a new standard has the potential to 

have a substantial impact on the capital 

and operating cost profiles of water and 

wastewater utilities over the thirty-year 

period of analysis. (Joint Comment, No. 

15 at p. 8) 

DOE acknowledges that clothes 

washer standards could affect water and 

wastewater utilities. However, to 

analyze water and wastewater utility 

impacts, an analytical tool comparable 

to NEMS would be needed to account 

properly for the nationwide effects of 

standards on water and wastewater 

delivery and treatment. At this time, 

DOE does not have such a tool or access 

to any other means to quantify the water 

and wastewater utility impacts from 

potential clothes washer standards. 

L. Emissions Analysis 

In the emissions analysis, DOE 

estimated the reduction in power sector 

emissions of CO2, NOX, and Hg from 

amended energy conservation standards 

for clothes washers. DOE used the 

NEMS–BT computer model, which is 

run similarly to the AEO NEMS, except 

that clothes washer energy use is 

reduced by the amount of energy saved 

(by fuel type) due to each TSL. The 

inputs of national energy savings come 

from the NIA spreadsheet model, while 

the output is the forecasted physical 

emissions. The net benefit of each TSL 

is the difference between the forecasted 

emissions estimated by NEMS–BT at 

each TSL and the AEO2010 Reference 

Case. NEMS–BT tracks CO2 emissions 

using a detailed module that provides 

results with broad coverage of all sectors 

and inclusion of interactive effects. For 

today’s rule, DOE used the version of 

NEMS–BT based on AEO2010, which 

incorporated projected effects of all 

emissions regulations promulgated as of 

Jan. 31, 2010. 


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36National Research Council. Hidden Costs of 

Energy: Unpriced Consequences of Energy 

Production and Use. National Academies Press: 

Washington, DC. 2009. 

SO2 emissions from affected electric 

generating units (EGUs) are subject to 

nationwide and regional emissions cap 

and trading programs, and DOE has 

determined that these programs create 

uncertainty about the impact of energy 

conservation standards on SO2

emissions. Title IV of the Clean Air Act 

sets an annual emissions cap on SO2 for 

affected EGUs in the 48 contiguous 

States and the District of Columbia (DC). 

SO2 emissions from 28 eastern States 

and DC are also limited under the Clean 

Air Interstate Rule (CAIR, 70 FR 25162 

(May 12, 2005)), which created an 

allowance-based trading program that 

would gradually replace the Title IV 

program in those States and DC. 

Although CAIR was remanded to EPA 

by the U.S. Court of Appeals for the 

District of Columbia Circuit (D.C. 

Circuit), see North Carolina v. EPA, 550 

F.3d 1176 (D.C. Cir. 2008), it remained 

in effect temporarily, consistent with 

the D.C. Circuit’s earlier opinion in 

North Carolina v. EPA, 531 F.3d 896 

(D.C. Cir. 2008). On July 6, 2010, EPA 

issued the Transport Rule proposal, a 

replacement for CAIR. 75 FR 45210 

(Aug. 2, 2010). On July 6, 2011 EPA 

issued a replacement for CAIR, the 

Cross-State Air Pollution Rule. 76 FR 

48208 (August 8, 2011). (See http:// 

www.epa.gov/crossstaterule/). On 

December 30, 2011, however, the D.C. 

Circuit stayed the new rules while a 

panel of judges reviews them, and told 

EPA to continue enforcing CAIR (see 

EME Homer City Generation v. EPA, No. 

11–1302, Order at *2 (D.C. Cir. Dec. 30, 

2011)). The AEO2010 NEMS–BT used 

for today’s direct final rule assumes the 

implementation of CAIR. 

The attainment of emissions caps 

typically is flexible among EGUs and is 

enforced through the use of emissions 

allowances and tradable permits. Under 

existing EPA regulations, any excess 

SO2 emissions allowances resulting 

from the lower electricity demand 

caused by the imposition of an 

efficiency standard could be used to 

permit offsetting increases in SO2

emissions by any regulated EGU. 

However, if the standard resulted in a 

permanent increase in the quantity of 

unused emissions allowances, there 

would be an overall reduction in SO2

emissions from the standards. While 

there remains some uncertainty about 

the ultimate effects of efficiency 

standards on SO2 emissions covered by 

the existing cap-and-trade system, the 

NEMS–BT modeling system that DOE 

uses to forecast emissions reductions 

currently indicates that no physical 

reductions in power sector emissions 

would occur for SO2. 

As discussed above, the AEO2010 

NEMS–BT used for today’s NOPR 

assumes the implementation of CAIR, 

which established a cap on NOX

emissions in 28 eastern States and the 

District of Columbia. With CAIR in 

effect, the energy conservation 

standards for clothes washers are 

expected to have little or no physical 

effect on NOX emissions in those States 

covered by CAIR, for the same reasons 

that they may have little effect on SO2

emissions. However, the standards 

would be expected to reduce NOX

emissions in the 22 States not affected 

by CAIR. For these 22 States, DOE used 

the NEMS–BT to estimate NOX

emissions reductions from the standards 

considered in today’s direct final rule. 

On December 21, 2011, EPA 

announced national emissions 

standards for hazardous air pollutants 

(NESHAPs) for mercury and certain 

other pollutants emitted from coal and 

oil-fired EGUs. 76 FR 24976. The 

NESHAPs do not include emissions 

caps and, as such, DOE’s energy 

conservation standards would likely 

reduce Hg emissions. For the emissions 

analysis for this rulemaking, DOE 

estimated mercury emissions reductions 

using NEMS–BT based on AEO2010, 

which does not incorporate the 

NESHAPs. DOE expects that future 

versions of the NEMS–BT model will 

reflect the implementation of the 

NESHAPs. 

M. Monetizing Carbon Dioxide and 

Other Emissions Impacts 

As part of the development of this 

direct final rule, DOE considered the 

estimated monetary benefits likely to 

result from the reduced emissions of 

CO2 and NOX that are expected to result 

from each of the considered TSLs. In 

order to make this calculation similar to 

the calculation of the NPV of consumer 

benefit, DOE considered the reduced 

emissions expected to result over the 

lifetime of products shipped in the 

forecast period for each TSL. This 

section summarizes the basis for the 

monetary values used for each of these 

emissions and presents the benefits 

estimates considered. 

For today’s direct final rule, DOE is 

relying on a set of values for the social 

cost of carbon (SCC) that was developed 

by an interagency process. A summary 

of the basis for these values is provided 

below, and a more detailed description 

of the methodologies used is provided 

in appendix 15–A of the direct final rule 

TSD. 

1. Social Cost of Carbon 

Under Executive Order 12866, 

agencies must, to the extent permitted 

by law, ‘‘assess both the costs and the 

benefits of the intended regulation and, 

recognizing that some costs and benefits 

are difficult to quantify, propose or 

adopt a regulation only upon a reasoned 

determination that the benefits of the 

intended regulation justify its costs.’’ 

The purpose of the SCC estimates 

presented here is to allow agencies to 

incorporate the monetized social 

benefits of reducing CO2 emissions into 

cost-benefit analyses of regulatory 

actions that have small, or ‘‘marginal,’’ 

impacts on cumulative global emissions. 

The estimates are presented with an 

acknowledgement of the many 

uncertainties involved and with a clear 

understanding that they should be 

updated over time to reflect increasing 

knowledge of the science and 

economics of climate impacts. 

As part of the interagency process that 

developed these SCC estimates, 

technical experts from numerous 

agencies met on a regular basis to 

consider public comments, explore the 

technical literature in relevant fields, 

and discuss key model inputs and 

assumptions. The main objective of this 

process was to develop a range of SCC 

values using a defensible set of input 

assumptions grounded in the existing 

scientific and economic literatures. In 

this way, key uncertainties and model 

differences transparently and 

consistently inform the range of SCC 

estimates used in the rulemaking 

process. 

a. Monetizing Carbon Dioxide Emissions 

The SCC is an estimate of the 

monetized damages associated with an 

incremental increase in carbon 

emissions in a given year. It is intended 

to include (but is not limited to) changes 

in net agricultural productivity, human 

health, property damages from 

increased flood risk, and the value of 

ecosystem services. Estimates of the 

SCC are provided in dollars per metric 

ton of carbon dioxide. 

When attempting to assess the 

incremental economic impacts of carbon 

dioxide emissions, the analyst faces a 

number of serious challenges. A recent 

report from the National Research 

Council 36 points out that any 

assessment will suffer from uncertainty, 

speculation, and lack of information 

about (1) future emissions of greenhouse 

gases, (2) the effects of past and future 

emissions on the climate system, (3) the 

impact of changes in climate on the 

physical and biological environment, 


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37 It is recognized that this calculation for 

domestic values is approximate, provisional, and 

highly speculative. There is no a priori reason why 

domestic benefits should be a constant fraction of 

net global damages over time. 

38Throughout this section, references to tons of 

CO2 refer to metric tons. 

and (4) the translation of these 

environmental impacts into economic 

damages. As a result, any effort to 

quantify and monetize the harms 

associated with climate change will 

raise serious questions of science, 

economics, and ethics and should be 

viewed as provisional. 

Despite the serious limits of both 

quantification and monetization, SCC 

estimates can be useful in estimating the 

social benefits of reducing carbon 

dioxide emissions. Consistent with the 

directive quoted above, the purpose of 

the SCC estimates presented here is to 

make it possible for agencies to 

incorporate the social benefits from 

reducing carbon dioxide emissions into 

cost-benefit analyses of regulatory 

actions that have small, or ‘‘marginal,’’ 

impacts on cumulative global emissions. 

Most Federal regulatory actions can be 

expected to have marginal impacts on 

global emissions. 

For such policies, the agency can 

estimate the benefits from reduced (or 

costs from increased) emissions in any 

future year by multiplying the change in 

emissions in that year by the SCC value 

appropriate for that year. The net 

present value of the benefits can then be 

calculated by multiplying each of these 

future benefits by an appropriate 

discount factor and summing across all 

affected years. This approach assumes 

that the marginal damages from 

increased emissions are constant for 

small departures from the baseline 

emissions path, an approximation that 

is reasonable for policies that have 

effects on emissions that are small 

relative to cumulative global carbon 

dioxide emissions. For policies that 

have a large (non-marginal) impact on 

global cumulative emissions, there is a 

separate question of whether the SCC is 

an appropriate tool for calculating the 

benefits of reduced emissions. This 

concern is not applicable to this notice, 

and DOE does not attempt to answer 

that question here. 

At the time of the preparation of this 

notice, the most recent interagency 

estimates of the potential global benefits 

resulting from reduced CO2 emissions in 

2010, expressed in 2010$, were $4.9, 

$22.3, $36.5, and $67.6 per metric ton 

avoided. For emission reductions that 

occur in later years, these values grow 

in real terms over time. Additionally, 

the interagency group determined that a 

range of values from 7 percent to 23 

percent should be used to adjust the 

global SCC to calculate domestic 

effects,37 although preference is given to 

consideration of the global benefits of 

reducing CO2 emissions. 

It is important to emphasize that the 

interagency process is committed to 

updating these estimates as the science 

and economic understanding of climate 

change and its impacts on society 

improves over time. Specifically, the 

interagency group has set a preliminary 

goal of revisiting the SCC values within 

2 years or at such time as substantially 

updated models become available, and 

to continue to support research in this 

area. In the meantime, the interagency 

group will continue to explore the 

issues raised by this analysis and 

consider public comments as part of the 

ongoing interagency process. 

b. Social Cost of Carbon Values Used in 

Past Regulatory Analyses 

To date, economic analyses for 

Federal regulations have used a wide 

range of values to estimate the benefits 

associated with reducing carbon dioxide 

emissions. In the final model year 2011 

CAFE rule, the U.S. Department of 

Transportation (DOT) used both a 

‘‘domestic’’ SCC value of $2 per ton of 

CO2 and a ‘‘global’’ SCC value of $33 per 

ton of CO2 for 2007 emission reductions 

(in 2007$), increasing both values at 2.4 

percent per year.38 DOT also included a 

sensitivity analysis at $80 per ton of 

CO2. See Average Fuel Economy 

Standards Passenger Cars and Light 

Trucks Model Year 2011, 74 FR 14196 

(March 30, 2009) (Final Rule); Final 

Environmental Impact Statement 

Corporate Average Fuel Economy 

Standards, Passenger Cars and Light 

Trucks, Model Years 2011–2015 at 3–90 

(Oct. 2008) (Available at: 

www.nhtsa.gov/fuel-economy). A 

domestic SCC value is meant to reflect 

the value of damages in the United 

States resulting from a unit change in 

carbon dioxide emissions, while a 

global SCC value is meant to reflect the 

value of damages worldwide. 

A 2008 regulation proposed by DOT 

assumed a domestic SCC value of $7 per 

ton of CO2 (in 2006$) for 2011 emission 

reductions (with a range of $0¥$14 for 

sensitivity analysis), also increasing at 

2.4 percent per year. See Average Fuel 

Economy Standards, Passenger Cars 

and Light Trucks, Model Years 2011– 

2015, 73 FR 24352 (May 2, 2008) 

(Proposed Rule); Draft Environmental 

Impact Statement Corporate Average 

Fuel Economy Standards, Passenger 

Cars and Light Trucks, Model Years 

2011–2015 at 3–58 (June 2008) 

(Available at: http://www.nhtsa.gov/ 

fuel-economy). A regulation for 

packaged terminal air conditioners and 

packaged terminal heat pumps finalized 

by DOE in October of 2008 used a 

domestic SCC range of $0 to $20 per ton 

CO2 for 2007 emission reductions (in 

2007$), 73 FR 58772, 58814 (Oct. 7, 

2008). In addition, EPA’s 2008 Advance 

Notice of Proposed Rulemaking for 

Greenhouse Gases identified what it 

described as ‘‘very preliminary’’ SCC 

estimates subject to revision. See 

Regulating Greenhouse Gas Emissions 

Under the Clean Air Act, 73 FR 44354 

(July 30, 2008). EPA’s global mean 

values were $68 and $40 per ton CO2 for 

discount rates of approximately 2 

percent and 3 percent, respectively (in 

2006$ for 2007 emissions). 

In 2009, an interagency process was 

initiated to offer a preliminary 

assessment of how best to quantify the 

benefits from reducing carbon dioxide 

emissions. To ensure consistency in 

how benefits are evaluated across 

agencies, the Administration sought to 

develop a transparent and defensible 

method, specifically designed for the 

rulemaking process, to quantify avoided 

climate change damages from reduced 

CO2 emissions. The interagency group 

did not undertake any original analysis. 

Instead, it combined SCC estimates from 

the existing literature to use as interim 

values until a more comprehensive 

analysis could be conducted. The 

outcome of the preliminary assessment 

by the interagency group was a set of 

five interim values: Global SCC 

estimates for 2007 (in 2006 dollars) of 

$55, $33, $19, $10, and $5 per ton of 

CO2. These interim values represent the 

first sustained interagency effort within 

the U.S. government to develop an SCC 

for use in regulatory analysis. The 

results of this preliminary effort were 

presented in several proposed and final 

rules and were offered for public 

comment in connection with proposed 

rules, including the joint EPA–DOT fuel 

economy and CO2 tailpipe emission 

proposed rules. 

c. Current Approach and Key 

Assumptions 

Since the release of the interim 

values, the interagency group 

reconvened on a regular basis to 

generate improved SCC estimates, 

which were used in this direct final 

rule. Specifically, the group considered 

public comments and further explored 

the technical literature in relevant 

fields. The interagency group relied on 

three integrated assessment models 

(IAMs) commonly used to estimate the 

SCC: The FUND, DICE, and PAGE 


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39The models are described in appendix 15–A of 

the direct final rule TSD. 

40Table A1 presents SCC values through 2050. 

For DOE’s calculation, it derived values after 2050 

using the 3-percent per year escalation rate used by 

the interagency group. 

models.39 These models are frequently 

cited in the peer-reviewed literature and 

were used in the last assessment of the 

Intergovernmental Panel on Climate 

Change. Each model was given equal 

weight in the SCC values that were 

developed. 

Each model takes a slightly different 

approach to model how changes in 

emissions result in changes in economic 

damages. A key objective of the 

interagency process was to enable a 

consistent exploration of the three 

models while respecting the different 

approaches to quantifying damages 

taken by the key modelers in the field. 

An extensive review of the literature 

was conducted to select three sets of 

input parameters for these models: 

Climate sensitivity, socio-economic and 

emissions trajectories, and discount 

rates. A probability distribution for 

climate sensitivity was specified as an 

input into all three models. In addition, 

the interagency group used a range of 

scenarios for the socio-economic 

parameters and a range of values for the 

discount rate. All other model features 

were left unchanged, relying on the 

model developers’ best estimates and 

judgments. 

The interagency group selected four 

SCC values for use in regulatory 

analyses. Three values are based on the 

average SCC from three integrated 

assessment models, at discount rates of 

2.5, 3, and 5 percent. The fourth value, 

which represents the 95th percentile 

SCC estimate across all three models at 

a 3-percent discount rate, is included to 

represent higher-than-expected impacts 

from temperature change further out in 

the tails of the SCC distribution. 

TABLE IV–21—SOCIAL COST OF CO2, 2010–2050 

[In 2007 dollars per metric ton] 

Discount rate 

5% 

Avg 

3% 

Avg 

2.5% 

Avg 

3% 

95th 

2010 ................................................................................................. 4.7 21.4 35.1 64.9 

2015 ................................................................................................. 5.7 23.8 38.4 72.8 

2020 ................................................................................................. 6.8 26.3 41.7 80.7 

2025 ................................................................................................. 8.2 29.6 45.9 90.4 

2030 ................................................................................................. 9.7 32.8 50.0 100.0 

2035 ................................................................................................. 11.2 36.0 54.2 109.7 

2040 ................................................................................................. 12.7 39.2 58.4 119.3 

2045 ................................................................................................. 14.2 42.1 61.7 127.8 

2050 ................................................................................................. 15.7 44.9 65.0 136.2 

It is important to recognize that a 

number of key uncertainties remain, and 

that current SCC estimates should be 

treated as provisional and revisable 

since they will evolve with improved 

scientific and economic understanding. 

The interagency group also recognizes 

that the existing models are imperfect 

and incomplete. The National Research 

Council report mentioned above points 

out that there is tension between the 

goal of producing quantified estimates 

of the economic damages from an 

incremental ton of carbon and the limits 

of existing efforts to model these effects. 

There are a number of concerns and 

problems that should be addressed by 

the research community, including 

research programs housed in many of 

the agencies participating in the 

interagency process to estimate the SCC. 

DOE recognizes the uncertainties 

embedded in the estimates of the SCC 

used for cost-benefit analyses. As such, 

DOE and others in the U.S. Government 

intend to periodically review and 

reconsider those estimates to reflect 

increasing knowledge of the science and 

economics of climate impacts, as well as 

improvements in modeling. In this 

context, statements recognizing the 

limitations of the analysis and calling 

for further research take on exceptional 

significance. 

In summary, in considering the 

potential global benefits resulting from 

reduced CO2 emissions, DOE used the 

most recent values identified by the 

interagency process, adjusted to 2010$ 

using the GDP price deflator. For each 

of the four cases specified, the values 

used for emissions in 2010 were $4.9, 

$22.3, $36.5, and $67.6 per metric ton 

avoided (values expressed in 2010$).40

To monetize the CO2 emissions 

reductions expected to result from 

amended standards for clothes washers, 

DOE used the values identified in Table 

A1 of the ‘‘Social Cost of Carbon for 

Regulatory Impact Analysis Under 

Executive Order 12866,’’ which is 

reprinted in appendix 16–A of the direct 

final rule TSD, appropriately adjusted to 

2010$. To calculate a present value of 

the stream of monetary values, DOE 

discounted the values in each of the 

four cases using the specific discount 

rate that had been used to obtain the 

SCC values in each case. 

Commenting on the framework 

document, Whirlpool stated that CO2

emissions should not be monetized 

because the market value cannot be 

readily determined, the impact is 

negligible, and it is already included in 

energy savings. (Whirlpool, No. 22 at p. 

6) DOE acknowledges that the market 

value of future CO2 emissions 

reductions is uncertain, and for this 

reason it uses a wide range of potential 

values, as described above. The impact 

of revised standards clothes washers on 

future CO2 emissions, described in 

section V.B.6 of this notice, is not 

negligible. In addition, the value of CO2

emissions reductions is not included in 

energy cost savings because the energy 

prices that DOE used to calculate those 

savings do not include any taxes or 

other charges to account for the CO2

emissions associated with the use of 

electricity or natural gas by residential 

clothes washers. 

2. Valuation of Other Emissions 

Reductions 

DOE investigated the potential 

monetary benefit of reduced NOX

emissions from the TSLs it considered. 

As noted above, amended energy 

conservation standards would reduce 

NOX emissions in those 22 States that 

are not affected by the CAIR, in addition 

to the reduction in site NOX emissions 

nationwide. DOE estimated the 

monetized value of NOX emissions 


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Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 32357 

41For additional information, refer to U.S. Office 

of Management and Budget, Office of Information 

and Regulatory Affairs. 2006 Report to Congress on 

the Costs and Benefits of Federal Regulations and 

Unfunded Mandates on State, Local, and Tribal 

Entities. 2006. Washington, DC. 

42OMB, Circular A–4: Regulatory Analysis (Sept. 

17, 2003). 

reductions resulting from each of the 

TSLs considered for today’s direct final 

rule based on environmental damage 

estimates from the literature. Available 

estimates suggest a very wide range of 

monetary values, ranging from $370 per 

ton to $3,800 per ton of NOX from 

stationary sources, measured in 2001$ 

(equivalent to a range of $450 to $4,623 

per ton in 2010$).41 In accordance with 

OMB guidance, DOE conducted two 

calculations of the monetary benefits 

derived using each of the economic 

values used for NOX, one using a real 

discount rate of 3 percent and another 

using a real discount rate of 7 percent.42

DOE is aware of multiple agency 

efforts to determine the appropriate 

range of values used in evaluating the 

potential economic benefits of reduced 

Hg emissions. DOE has decided to await 

further guidance regarding consistent 

valuation and reporting of Hg emissions 

before it once again monetizes Hg in its 

rulemakings. 

V. Analytical Results 

The following section addresses the 

results from DOE’s analyses with 

respect to potential energy conservation 

standards for residential clothes 

washers of this rulemaking. It addresses 

the TSLs examined by DOE, the 

projected impacts of each of these levels 

if adopted as energy conservation 

standards for clothes washers, and the 

standards levels that DOE sets forth in 

today’s direct final rule. Additional 

details regarding DOE’s analyses are 

contained in the publicly available 

direct final rule TSD supporting this 

notice. 

A. Trial Standard Levels 

DOE analyzed the benefits and 

burdens of a number of TSLs for 

residential clothes washers, the 

products that are the subject of today’s 

direct final rule. Each TSL DOE 

analyzed is described below. DOE 

attempted to limit the number of TSLs 

considered for the final rule by 

excluding efficiency levels that do not 

exhibit significantly different economic 

and/or engineering characteristics from 

the efficiency levels already selected as 

a TSL. Although DOE presents the 

results for only those efficiency levels in 

TSL combinations in today’s final rule, 

DOE presents the results for all 

efficiency levels that it analyzed in the 

final rule TSD. 

Table V–1 presents the TSLs and the 

corresponding product class efficiency 

levels for clothes washers. 

For standard-size products, TSL 1 

consists of the efficiency levels that are 

two levels above the baseline levels 

(which are considered Efficiency Level 

0). TSL 2 represents an intermediary 

point between the efficiency levels 

chosen for TSL 1 and the efficiency 

levels recommended in the Joint 

Petition. TSL 3 consists of the efficiency 

levels recommended in the Joint 

Petition. In the case of TSL 3, for toploading standard clothes washers, one 

set of values would apply starting in 

2015, and another set would apply 

starting in 2018. TSL 4 consists of the 

efficiency levels that are one level below 

the max-tech efficiency levels. TSL 5 

consists of the max-tech efficiency 

levels. 

For top-loading compacts, TSL 1, TSL 

2 and the 2015 level of TSL 3 consists 

of Efficiency Level 1, and TSL 4 and 

TSL 5 and the 2018 level of TSL 3 

consist of Efficiency Level 2. For frontloading compacts, all TSLs consist of 

Efficiency Level 1. 

TABLE V–1—TRIAL STANDARD LEVELS FOR RESIDENTIAL CLOTHES WASHERS

TSL 

Top-loading standard Front-loading standard 

Efficiency level IMEF 

ft3/kWh/cycle 

Standby 

W Efficiency level IMEF ft3/kWh/cycle 

Standby 

W 

1 ............................................................... 2 1.29 0.00 2 1.41 0.08 

2 ............................................................... 5 1.37 0.08 4 1.66 0.08 

3 * ............................................................. 2 1.29 0.00 5 1.84 0.08 

3 ** ............................................................ 6 1.57 0.08 

4 ............................................................... 7 1.83 0.08 7 2.20 0.08 

5 ............................................................... 8 2.04 0.08 8 2.46 0.08 

Top-loading compact Front-loading compact 

1 ............................................................... 1 0.86 0.00 1 1.13 0.08 

2 ............................................................... 1 0.86 0.00 1 1.13 0.08 

3 * ............................................................. 1 0.86 0.00 1 1.13 0.08 

3 ** ............................................................ 2 1.15 2.30 

4 ............................................................... 2 1.15 2.30 1 1.13 0.08 

5 ............................................................... 2 1.15 2.30 1 1.13 0.08 

* 2015 levels. 

** 2018 levels. 


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B. Economic Justification and Energy 

Savings 

1. Economic Impacts on Individual 

Consumers 

a. Life-Cycle Cost and Payback Period 

Consumers affected by new or 

amended standards usually experience 

higher purchase prices and lower 

operating costs. Generally, the impacts 

on individual consumers are best 

captured by changes in life-cycle cost 

(LCC) and by the payback period (PBP). 

Therefore, DOE calculated the LCC and 

PBP analyses for the potential standard 

levels considered in this rulemaking. 

DOE’s LCC and PBP analyses provided 

key outputs for each TSL, which are 

reported by clothes washer product 

class in Table V–2 through Table V–5. 

Each table includes the average total 

LCC and the average LCC savings, as 

well as the fraction of product 

consumers for which the LCC will 

decrease (net benefit), increase (net 

cost), or exhibit no change (no impact) 

relative to the base-case forecast. The 

last column in the tables contains the 

median PBP for the consumer 

purchasing a design that complies with 

the TSL. DOE presents the median PBP 

because it is the most statistically robust 

measure of the PBP. The results for each 

potential standard level are relative to 

the efficiency distribution in the base 

case (no amended standards). DOE 

based the LCC and PBP analyses on the 

range of energy consumption under 

conditions of actual product use. 

TABLE V–2—LCC AND PBP RESULTS FOR TOP-LOADING STANDARD CLOTHES WASHERS

TSL IMEF 

Life-cycle cost 2010$ LCC Savings Payback period years 

Installed 

cost 

Discounted 

operating 

cost 

LCC 

Average 

savings 

2010$ 

Percent of households that experience 

Median Net cost No impact Net benefit 

1 ............... 1.29 425 1,317 1,743 268 0.7 19.5 79.8 0.4 

2 ............... 1.37 433 1,340 1,773 243 5.6 15.1 79.3 0.7 

3 * ............. 1.29 425 1,317 1,743 268 0.7 19.5 79.8 0.4 

3 ** ............ 1.57 448 1,182 1,630 366 3.4 14.1 82.5 0.9 

4 ............... 1.83 496 1,003 1,499 491 8.1 4.6 87.4 1.8 

5 ............... 2.04 508 958 1,466 524 9.5 0.0 90.5 1.9 

* 2015 levels. 

** 2018 levels. 

TABLE V–3—LCC AND PBP RESULTS FOR FRONT-LOADING STANDARD CLOTHES WASHERS

TSL IMEF 

Life-cycle cost 2010$ LCC Savings Payback period years 

Installed 

cost 

Discounted 

operating 

cost 

LCC 

Average 

savings 

2010$ 

Percent of households that experience 

Median Net cost No impact Net benefit 

1 ............... 1.41 867 1,214 2,081 0 0.0 100.0 0.0 NA 

2 ............... 1.66 874 1,088 1,961 2.2 0.1 96.0 3.9 0.9 

3 ............... 1.84 888 946 1,835 37 1.5 72.4 26.1 1.3 

4 ............... 2.20 938 900 1,838 35 45.1 11.6 43.3 9.2 

5 ............... 2.46 964 807 1,771 102 29.6 0.0 70.4 5.2 

TABLE V–4—LCC AND PBP RESULTS FOR TOP-LOADING COMPACT CLOTHES WASHERS

TSL IMEF 

Life-cycle cost 2010$ LCC Savings Payback period years 

Installed 

cost 

Discounted 

operating 

cost 

LCC 

Average 

savings 

2010$ 

Percent of households that experience 

Median Net cost No impact Net benefit 

1 ............... 0.86 426 988 1,414 159 1.5 0.0 98.5 0.5 

2 ............... 0.86 426 988 1,414 159 1.5 0.0 98.5 0.5 

3 * ............. 0.86 426 988 1,414 159 1.5 0.0 98.5 0.5 

3 ** ............ 1.15 480 781 1,261 312 12.6 0.0 87.4 2.1 

4 ............... 1.15 480 781 1,261 312 12.6 0.0 87.4 2.1 

5 ............... 1.15 480 781 1,261 312 12.6 0.0 87.4 2.1 

* 2015 levels. 

** 2018 levels. 

TABLE V–5—LCC AND PBP RESULTS FOR FRONT-LOADING COMPACT CLOTHES WASHERS

TSL IMEF 

Life-cycle cost 2010$ LCC Savings Payback period years 

Installed 

cost 

Discounted 

operating 

cost 

LCC 

Average 

savings 

2010$ 

Percent of households that experience 

Median Net cost No impact Net benefit 

1 ............... 1.13 865 694 1,559 54 0.0 0.0 100.0 0.8 

2 ............... 1.13 865 694 1,559 54 0.0 0.0 100.0 0.8 

3 ............... 1.13 865 694 1,559 54 0.0 0.0 100.0 0.8 

4 ............... 1.13 865 694 1,559 54 0.0 0.0 100.0 0.8 


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TABLE V–5—LCC AND PBP RESULTS FOR FRONT-LOADING COMPACT CLOTHES WASHERS—Continued 

TSL IMEF 

Life-cycle cost 2010$ LCC Savings Payback period years 

Installed 

cost 

Discounted 

operating 

cost 

LCC 

Average 

savings 

2010$ 

Percent of households that experience 

Median Net cost No impact Net benefit 

5 ............... 1.13 865 694 1,559 54 0.0 0.0 100.0 0.8 

b. Consumer Sub-Group Analysis 

As described in section IV.H, DOE 

determined the impact of the considered 

TSLs on low-income households and 

senior-only households. Table V–6 

compares the average LCC savings at 

each efficiency level for the two 

consumer subgroups, along with the 

average LCC savings for the entire 

sample for each product class for 

clothes washers. For compacts, DOE 

also analyzed impacts on multi-family 

consumers, since they are most likely to 

use compact washers. In general, the 

average LCC savings 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 direct final rule TSD presents the 

complete LCC and PBP results for the 

consumer subgroups. 

TABLE V–6—CLOTHES WASHERS: COMPARISON OF AVERAGE LCC SAVINGS FOR CONSUMER SUBGROUPS AND ALL

HOUSEHOLDS

TSL 

Top-loading standard Front-loading standard 

IMEF Senior Low-income All IMEF Senior Low-income All 

1 ....................................................................................................... 1.29 163 240 268 1.41 0 0 0 

2 ....................................................................................................... 1.37 142 203 243 1.66 1.3 2.5 2.2 

3 * ..................................................................................................... 1.29 163 240 268 1.84 22 36 37 

3 ** .................................................................................................... 1.57 214 319 366 

4 ....................................................................................................... 1.83 275 437 491 2.20 6.0 39 35 

5 ....................................................................................................... 2.04 291 466 524 2.46 38 109 102 

TSL 

Top-loading compact Front-loading compact 

IMEF Senior Low-income 

Multifamily All IMEF Senior Low-income Multifamily All 

1 ....................................................................... 0.86 99 150 127 159 1.13 41 57 48 54 

2 ....................................................................... 0.86 99 150 127 159 1.13 41 57 48 54 

3 * ..................................................................... 0.86 99 150 127 159 1.13 41 57 48 54 

3 ** .................................................................... 1.15 163 275 227 312 1.13 

4 ....................................................................... 1.15 163 275 227 312 1.13 41 57 48 54 

5 ....................................................................... 1.15 163 275 227 312 1.13 41 57 48 54 

* Refers to 2015 levels for top-loading washers. 

** Refers to 2018 levels for top-loading washers. 

c. Rebuttable Presumption Payback 

As discussed above, EPCA provides a 

rebuttable presumption that an energy 

conservation standard is economically 

justified if the increased purchase cost 

for a product that meets the standard is 

less than three times the value of the 

first-year energy savings resulting from 

the standard. In calculating a rebuttable 

presumption payback period for the 

considered standard levels, DOE used 

discrete values rather than distributions 

for input values, and, as required by 

EPCA, based the energy use calculation 

on the DOE test procedures for 

residential clothes washers. As a result, 

DOE calculated a single rebuttable 

presumption payback value, and not a 

distribution of payback periods, for each 

efficiency level. Table V–7 presents the 

average rebuttable presumption payback 

periods for those efficiency levels where 

the increased purchase cost for a 

product that meets a standard at that 

level is less than three times the value 

of the first-year energy savings resulting 

from the standard. 


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TABLE V–7—CLOTHES WASHERS: EFFICIENCY LEVELS HAVING REBUTTABLE PBPS LESS THAN THREE YEARS

TSL 

Top-loading standard Front-loading standard Top-loading compact Front-loading compact 

IMEF PBP years IMEF PBP years IMEF PBP years IMEF PBP years 

1 ....................................... 1.29 0.7 1.41 0.3 0.86 0.30 1.13 0.7 

2 ....................................... 1.37 0.8 1.66 0.7 0.86 0.30 1.13 0.7 

3 * ..................................... 1.29 0.7 1.84 0.5 0.86 0.30 1.13 0.7 

3 ** .................................... 1.57 1.7 1.15 1.31 1.13 0.7 

4 ....................................... 1.83 2.1 2.20 1.1 1.15 1.31 1.13 0.7 

5 ....................................... 2.04 2.2 2.46 1.2 1.15 1.31 1.13 0.7 

* Refers to 2015 levels for top-loading washers. 

** Refers to 2018 levels for top-loading washers. 

While DOE examined the rebuttablepresumption criterion, it considered 

whether the standard levels considered 

for today’s rule 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). The results of that 

analysis serve as the basis for DOE to 

evaluate the economic justification for a 

potential standard level (thereby 

supporting or rebutting the results of 

any preliminary determination of 

economic justification). 

2. Economic Impacts on Manufacturers 

DOE performed an MIA to estimate 

the impact of amended energy 

conservation standards on 

manufacturers of residential clothes 

washers. The section below describes 

the expected impacts on manufacturers 

at each TSL. Chapter 12 of the direct 

final rule TSD explains the analysis in 

further detail. 

a. Industry Cash Flow Analysis Results 

The tables below depict the financial 

impacts on manufacturers (represented 

by changes in INPV) and the conversion 

costs DOE estimates manufacturers 

would incur at each TSL. Each set of 

results below shows INPV impacts 

under a different set of assumptions: 

The first table reflects the lower (least 

severe) bound of impacts and the third 

table represents the upper (most severe) 

bound. As described in section IV.I, 

DOE modeled three different scenarios 

using different markup assumptions to 

evaluate this range of cash-flow impacts 

on the industry. These assumptions 

correspond to the bounds of a range of 

market responses that DOE anticipates 

could occur in the standards case. Each 

scenario results in a unique set of cash 

flows and corresponding industry value 

at each TSL. 

The INPV results refer to the 

difference in industry value between the 

base case and the standards case, which 

DOE calculated by summing the 

discounted industry cash flows from the 

base year (2011) through the end of the 

analysis period. The discussion also 

notes the difference in cash flow 

between the base case and the standards 

case in the year before the compliance 

date of potential amended energy 

conservation standards. This figure 

provides a proxy for the magnitude of 

the required conversion costs relative to 

the cash flow generated by the industry 

in the base case. 

To assess the lower end of the range 

of potential impacts on the residential 

clothes washer industry, DOE modeled 

the no commoditization markup 

scenario. The no commoditization 

scenario assumes that the baseline 

manufacturer markup structure does not 

change in the standards case. In this 

scenario, the higher markup for the 2011 

ENERGY STAR level and the additional 

markup for CEE Tier 2 and Tier 3 

products continue in the standards case. 

This scenario also assumes that 

manufacturers would be able to fully 

pass the higher production costs 

required for more efficient products on 

to their customers in the standards case. 

In general, the more standards reduce 

the ability to differentiate on efficiency 

and the larger the product price 

increases, the less likely manufacturers 

are to achieve the cash flow from 

operations calculated in this scenario 

because the less likely it is that 

manufacturers would be able to fully 

mark up these larger cost increases. 

DOE also assessed two tiered markup 

scenarios, the tiered markup scenario 

and the tiered markup scenario with 

margin impacts. The latter represents 

the upper bound of the range of 

potential impacts on the industry. In the 

standards case, both tiered markup 

scenarios consider the situation in 

which the breadth of a manufacturer’s 

portfolio of products shrinks as 

amended standards result in the 

elimination of lower efficiency tiers 

from the market and the erosion of 

premium markups for higher-tier 

products. These scenarios model a 

reduction in markups that 

manufacturers may experience under 

more stringent amended energy 

conservation standards as premium 

products earn the same markups 

previously held by lower efficiency 

tiers. In the tiered markup scenario with 

margin impacts, no additional operating 

profit is earned on the higher 

production costs of products that meet 

the minimum energy conservation 

standard in the standards case, eroding 

profit margins as a percentage of total 

revenue. In addition, as base-case 

efficiency differentiators are eliminated 

in the standards case, products that 

previously earned a premium markup 

move to lower efficiency markup tiers. 

DOE used the reference NIA shipment 

scenario for all MIA scenarios used to 

characterize the potential INPV impacts. 

The shipment forecast is an important 

driver of the INPV results below (Table 

V–8 through Table V–10). The reference 

NIA shipment scenario includes two 

elasticity effects: (1) A relative price 

elasticity, which assumes higher 

product prices in the standards case 

result in lower shipments, and, in turn, 

lower industry revenue and INPV and 

(2) a cross-price elasticity, which 

changes the relative market share of toploading and front-loading clothes 

washers as price increases alter their 

relative costs to consumers. The 

reference NIA shipment scenario also 

includes the default price forecast as 

described in chapter 10 of the direct 

final rule TSD. 


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TABLE V–8—MANUFACTURER IMPACT ANALYSIS FOR RESIDENTIAL CLOTHES WASHERS—NO COMMODITIZATION MARKUP

SCENARIO

Units Base case 

Trial standard level 

1 2 3 4 5 

INPV .................................. (2010$ millions) ................ 2,585.7 2,529.4 2,571.3 2,682.0 2,790.7 2,841.2 

Change in INPV ................ (2010$ millions) ................ .................... (56.3) (14.3) 96.4 205.0 255.5 

(%) .................................... .................... ¥2.2% ¥0.6% 3.7% 7.9% 9.9% 

Product Conversion Costs (2010$ millions) ................ .................... 22.6 41.6 107.5 204.3 210.8 

Capital Conversion Costs (2010$ millions) ................ .................... 81.2 107.7 311.0 487.4 502.9 

Total Conversion 

Costs.

(2010$ millions) ................ .................... 103.9 149.3 418.5 691.8 713.7 

TABLE V–9—MANUFACTURER IMPACT ANALYSIS FOR RESIDENTIAL CLOTHES WASHERS—TIERED MARKUP SCENARIO

Units Base case 

Trial standard level 

1 2 3 4 5 

INPV .................................. (2010$ millions) ................ 2,585.7 2,529.4 2,110.0 1,762.8 1,453.0 1,417.5 

Change in INPV ................ (2010$ millions) ................ .................... (56.3) (475.7) (822.9) (1,132.7) (1,168.1) 

(%) .................................... .................... ¥2.2% ¥18.4% ¥31.8% ¥43.8% ¥45.2% 

Product Conversion Costs (2010$ millions) ................ .................... 22.6 41.6 107.5 204.3 210.8 

Capital Conversion Costs (2010$ millions) ................ .................... 81.2 107.7 311.0 487.4 502.9 

Total Conversion 

Costs.

(2010$ millions) ................ .................... 103.9 149.3 418.5 691.8 713.7 

TABLE V–10—MANUFACTURER IMPACT ANALYSIS FOR RESIDENTIAL CLOTHES WASHERS—TIERED MARKUP SCENARIO

WITH MARGIN IMPACTS

Units Base case 

Trial standard level 

1 2 3 4 5 

INPV .................................. (2010$ millions) ................ 2,585.7 2,521.7 2,095.3 1,726.9 1,329.3 1,250.4 

Change in INPV ................ (2010$ millions) ................ .................... (64.0) (490.3) (858.8) (1,256.4) (1,335.3) 

(%) .................................... .................... ¥2.5% ¥19.0% ¥33.2% ¥48.6% ¥51.6% 

Product Conversion Costs (2010$ millions) ................ .................... 22.6 41.6 107.5 204.3 210.8 

Capital Conversion Costs (2010$ millions) ................ .................... 81.2 107.7 311.0 487.4 502.9 

Total Conversion 

Costs.

(2010$ millions) ................ .................... 103.9 149.3 418.5 691.8 713.7 

At TSL 1, DOE estimates impacts on 

INPV to range ¥$56.3 million to 

¥$64.0 million, or a change in INPV of 

¥2.2 percent to ¥2.5 percent. At this 

level, industry free cash flow is 

estimated to decrease by approximately 

20.2 percent to $170.0 million, 

compared to the base-case value of 

$213.1 million in the year leading up to 

the amended energy conservation 

standards. 

Because the top-loading and frontloading standard clothes washers 

comprise over 98 percent of the total 

residential clothes washer shipments, 

the vast majority of the INPV impacts 

come from the standard-size product 

classes. At TSL 1, most impacts on both 

INPV and free cash flow stem from the 

modest changes required for top-loading 

standard clothes washers because all of 

the front-loading standard residential 

clothes washers on the market today 

already meet standards at this level. For 

top-loading clothes washers, of which 

only 13 percent of the market currently 

meets standards proposed at TSL 1, the 

impacts on INPV and free cash flow 

arise from increases in upfront 

investment for product development 

and, to a lesser extent, the per-unit 

component costs required to achieve 

this efficiency level. TSL 1 would 

require investments in product redesign 

and improvements to facilities totaling 

approximately $103.9 million in an 

industry with base-case annual revenues 

of more than $4.4 billion in the year the 

standards go into effect. Regarding 

increases in component costs, the 

design options used to meet standards at 

TSL 1 include component changes such 

as electronic controls, agitator 

modification, and basket modifications. 

For top-loading standard residential 

clothes washers, these changes 

contribute only $8.44 (3.4 percent) to 

arrive at an MPC of $256.09. In 

summation, the cumulative effect on 

INPV and free cash flow is minimal 

largely because all front-loading 

standard products and some top-loading 

standard products already meet the 

efficiencies required at TSL 1, and the 

design changes for the top-loading 

standard products that do not meet the 

efficiency required at TSL1 would 

impose minimal costs. Further, as the 

efficiencies required at TSL 1 are well 

below ENERGY STAR levels, 

manufacturers are likely to retain the 

premiums they currently see across the 

full range of product efficiencies. 

At TSL 2, DOE estimates impacts on 

INPV to range ¥$14.3 million to 

¥$490.3 million, or a change in INPV 

of ¥0.6 percent to ¥19.0 percent. At 

this level, industry free cash flow is 

estimated to decrease by approximately 


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32362 Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 

28.4 percent to $152.6 million, 

compared to the base-case value of 

$213.1 million in the year leading up to 

the amended energy conservation 

standards. 

Because the top-loading and frontloading standard clothes washers 

comprise over 98 percent of the total 

residential clothes washer shipments, 

the vast majority of the INPV impacts 

come from the standard-size product 

classes. At TSL 2, the impacts on INPV 

and free cash flow result from higher 

per-unit costs for both top-loading and 

front-loading standard-sized product 

classes as well as increases in product 

and capital conversion costs for both of 

these product classes. The design 

options used to meet standards at TSL 

2 for top-loading standard-size products 

include additional component changes 

to enable higher spin speeds and better 

control beyond the improvements to 

electronic controls and the agitator and 

basket associated with TSL 1. For frontloading standard-size products, TSL 2 is 

achieved by the use of an electronic user 

interface. The resulting MPC for toploading standard residential clothes 

washers is approximately $261.88 at 

TSL 2, a $14.23 (5.7 percent) increase 

over current baseline units and similar 

to the incremental costs at TSL 1. For 

front-loading standard residential 

clothes washers, the MPC is 

approximately $524.33, a $6.20 (1.2 

percent) increase from the baseline. The 

product redesign and incorporation of 

these changes into manufacturing lines 

requires approximately $149.3 million 

in total conversion costs—a $45.4 

million increase from TSL 1. TSL 2 

brings all front-loading standard 

washers up to current ENERGY STAR 

standard levels. The most severe impact 

to INPV at TSL 2 is the result of margin 

compression on front-loading standard 

clothes washers as manufacturers forfeit 

premiums and cut into margins as they 

try to maintain a marginally compliant 

competitively priced entry level 

product. While only a small fraction of 

front-loading clothes washers (4 percent 

of shipments) would be impacted in the 

standards case at TSL2, in the tiered 

markup scenario with margin 

compression the profitability impacts on 

front-loading clothes washers has a 

disproportionately large negative impact 

on INPV because most of the market is 

ENERGY STAR compliant in the base 

case. 

At TSL 3, DOE estimates impacts on 

INPV to range $96.4 million to ¥$858.8 

million, or a change in INPV of 3.7 

percent to ¥33.2 percent. At this level, 

industry free cash flow is estimated to 

decrease by approximately 3.6 percent 

to $205.5 million, compared to the basecase value of $213.1 million in the year 

leading up to the amended energy 

conservation standards in 2015. 

At TSL3, the largest impacts to free 

cash flow and INPV stem from the 

substantial upfront investments 

required to achieve this efficiency level. 

While the efficiency requirements for 

top-loading standard clothes washers in 

2015 require incremental changes to 

existing products, the 2018 efficiency 

requirements for top-loading standard 

clothes washers are more substantial. 

Because only 9 percent of current 

shipments of top-loading standard 

clothes washers meet the 2018 

efficiency standards established at TSL 

3, manufacturing products to meet the 

2018 standards would require large 

investments in product redesign and 

conversion of facilities. Substantial 

investments would also be required for 

manufacturers to meet the 2015 frontloading standard. The total conversion 

cost required to meet the 2015 and 2018 

standards at TSL 3 is approximately 

$418.5 million—a substantial fraction of 

overall industry value and $269.2 

million higher than at TSL 2. Less than 

25 percent of the conversion costs 

associated with TSL 3 can be attributed 

to the 2015 compliance for top-loading 

standard products.. This is a 

considerably smaller factor than at TSL 

1 and TSL 2 at which 97 percent and 81 

percent of conversion costs can be 

attributed to standard top-loading 

compliance, respectively. The design 

options used to meet the 2015 frontloading and 2018 top-loading standards 

at TSL 3 include larger unit capacities, 

damping systems, and reinforced 

structural elements. Substantial changes 

to existing production facilities would 

be required to manufacture products to 

incorporate the 2015 front-loading and 

2018 top-loading design options. 

Several manufacturers have already 

introduced products that meet the 2015 

front-loading standard and 2018 toploading standard efficiency levels, 

which mitigates the required changes to 

production facilities for these 

manufacturers. The compliance dates of 

TSL 3 also mitigate the effect of the 

large conversion costs required to meet 

the 2018 top-loading standards, 

subjecting the impact on cash flows to 

greater discounting while also allowing 

manufactures to delay or spread out 

their conversion costs. At TSL 3, the 

MPC for top-loading standard 

residential clothes washers is $256.09 to 

meet the 2015 energy conservation 

standard and $272.93 to meet the 2018 

energy conservation standard. For frontloading standard residential clothes 

washers the MPC is approximately 

$535.38 to meet the 2015 energy 

conservation standard. For the 2015 

standard this is a $8.44 (3.4 percent) 

increase for top-loading standard 

clothes washers and a $17.25 (3.3 

percent) increase for front-loading 

standard clothes washers. For the 2018 

energy conservation standard for toploading standard clothes washers, this is 

a $25.28 (10.2 percent) increase. In the 

scenario in which manufacturers see no 

commoditization of higher efficiency 

clothes washers, the modest increases to 

MPC translate to higher margins 

sufficient to offset the initial capital 

investments and product design costs 

over the 30 year analysis period. In 

contrast in the tiered mark up scenario, 

because TSL 3 sets standards for toploading standard clothes washers at 

current ENERGY STAR levels and 

standards for front-loading standard 

clothes washers above these levels, 

manufacturers lose their premium 

markup for high efficiency standard-size 

product classes leading to a substantial 

reduction in future revenues and 

subsequently in INPV. 

At TSL 4, DOE estimates impacts on 

INPV to range $205.0 million to 

¥$1,256.4 million, or a change in INPV 

of 7.9 percent to ¥48.6 percent. At this 

level, industry free cash flow is 

estimated to decrease by approximately 

130.7 percent to ¥$65.5 million, 

compared to the base-case value of 

$213.1 million in the year leading up to 

the amended energy conservation 

standards. 

Much like TSL 3, the impacts to INPV 

at TSL 4 result primarily from the 

substantial upfront investments 

required to achieve the amended 

efficiency levels for standard-size 

products, the incremental increases in 

per-unit costs, and the potential margin 

impacts. For top-loading units, in 

contrast to TSL 3, manufacturers are 

required to cover the conversion costs 

for all products by 2015. Manufacturing 

products to meet standards for both 

standard-size product classes at TSL 4 

may require a complete platform 

overhaul, resulting in significant 

investments in both product redesign 

and the conversion of facilities. The 

total conversion cost required to meet 

standards at TSL 4 is approximately 

$691.8 million—a $273.3 million 

increase from TSL 3. The design options 

used to meet standards at TSL 4 include 

changes such as larger capacity, 

accelerometers, and better control 

technology beyond what is required for 

TSL 3. The resulting MPC for toploading standard residential clothes 

washers at TSL 4 is approximately 

$308.30, and approximately $572.01 for 

front-loading standard residential 


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Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 32363 

clothes washers. This is a $60.65 (24.5 

percent) and a $53.88 (10.4 percent) 

increase from the baseline for toploading and front-loading standard 

residential clothes washers, 

respectively. This increase in MPC 

translates to a 3.5 percent decrease in 

2015 shipments. However, the impact 

on INPV arising from a decrease in 

shipments from price elasticity is minor 

in comparison to that stemming from 

product commoditization and margin 

impacts as analyzed in the tiered 

markup scenario with margin impacts 

for standard-sized product classes. As 

TSL 4 brings standards for both toploading and front-loading standard 

products above current ENERGY STAR 

levels, the fraction of products that are 

eligible for any additional markup above 

the baseline is further reduced as 

manufacturers sacrifice margins as they 

continue to seek to maintain a lowprice-point basic product offering. 

At TSL 5, DOE estimates impacts on 

INPV to range $255.5 million to 

¥$1,335.3 million, or a change in INPV 

of 9.9 percent to ¥51.6 percent. At this 

level, industry free cash flow is 

estimated to decrease by approximately 

134.9 percent to ¥$74.3 million, 

compared to the base-case value of 

$213.1 million in the year leading up to 

the amended energy conservation 

standards. 

TSL 5 represents the max-tech 

efficiency level for both top-loading and 

front-loading standard clothes washers. 

The effects on INPV result from similar 

sources as TSL 4, including the 

substantial upfront investments 

required to achieve the amended 

efficiency levels, the incremental 

increases in per-unit costs, and the 

potential margin impacts. These effects, 

however, are compounded by the higher 

upfront investments for facility 

improvements and product 

development, the additional increases to 

the MPC, and the collapse of 

manufacturer margins as analyzed in the 

tiered markup scenario with margin 

impacts. At present, the market share of 

commercially available residential 

clothes washers that conform to this 

standard is negligible. As such, 

standards will affect nearly all platforms 

and manufacturers will incur 

substantial conversion costs associated 

with total redesigns and improvements 

to all production facilities. The total 

conversion cost required to meet 

standards at TSL 5 is approximately 

$713.7 million—a $21.9 million 

increase from TSL 4. TSL 5 does not 

delay compliance for the more stringent 

standard either top-loading product 

class, so manufacturers will incur all 

product and capital conversion costs by 

2015, leading to a larger negative impact 

on INPV. The MPC for top-loading 

standard residential clothes washers is 

approximately $317.44 at TSL 5, and 

approximately $591.64 for front-loading 

standard residential clothes washers. 

This is a $69.79 (28.2 percent) and a 

$73.51 (14.2 percent) increase from the 

baseline for top-loading and frontloading standard residential clothes 

washers, respectively. However, the 

increase in per-unit production costs at 

TSL 5 relative to those at TSL 4 is 

comparatively small and involves only 

minimal incremental design options 

such as changes to load size sensors and 

more precise dispensing of laundry 

detergent and additives. With the 

increase in MPCs, 2015 shipments are 

forecast to decrease by approximately 

4.4 percent at TSL 5. However, the 

impact on INPV arising from a decrease 

in shipments from price elasticity is 

minor in comparison to that stemming 

from product commoditization and 

margin impacts as analyzed in the tiered 

markup scenario with margin impacts. 

Where TSL 4 still provided some room 

for markups above the most basic units, 

TSL 5 sets the standard for all products 

as high as technically feasible, leaving 

manufacturers no ability to differentiate 

products by efficiency. Thus, all 

margins collapse to their lowest levels. 

b. Impacts on Employment 

DOE used the GRIM to estimate the 

domestic labor expenditures and 

number of domestic production workers 

in the base case and at each TSL from 

2011 to 2044. DOE used statistical data 

from the most recent U.S. Census 

Bureau’s 2009 ‘‘Annual Survey of 

Manufacturers,’’ the results of the 

engineering analysis, and interviews 

with manufacturers to determine the 

inputs necessary to calculate industrywide labor expenditures and domestic 

employment levels. Labor expenditures 

for the manufacture of a product are a 

function of the labor intensity of the 

product, the sales volume, and an 

assumption that wages in real terms 

remain constant. 

In the GRIM, DOE used the labor 

content of each product and the 

manufacturing production costs from 

the engineering analysis to estimate the 

annual labor expenditures in the 

residential clothes washer industry. 

DOE used Census data and interviews 

with manufacturers to estimate the 

portion of the total labor expenditures 

that is attributable to domestic labor. 

The production worker estimates in 

this section cover only workers up to 

the line-supervisor level who are 

directly involved in fabricating and 

assembling a product within an Original 

Equipment Manufacturer (OEM) facility. 

Workers performing services that are 

closely associated with production 

operations, such as material handing 

with a forklift, are also included as 

production labor. DOE’s estimates 

account only for production workers 

who manufacture the specific products 

covered by this rulemaking. 

The employment impacts shown in 

Table V–11 represent the potential 

production employment that could 

result following amended energy 

conservation standards. The upper end 

of the results in this table estimates the 

total potential increase in the number of 

production workers after amended 

energy conservation standards. To 

calculate the total potential increase, 

DOE assumed that manufacturers 

continue to produce the same scope of 

covered products in domestic 

production facilities and domestic 

production is not shifted to lower-laborcost countries. Because there is a real 

risk of manufacturers evaluating 

sourcing decisions in response to 

amended energy conservation 

standards, the lower end of the range of 

employment results in Table V–11 

includes the estimated total number of 

U.S. production workers in the industry 

who could lose their jobs if all existing 

production were moved outside of the 

United States. While the results present 

a range of employment impacts 

following the compliance date of 

amended energy conservation 

standards, the discussion below also 

includes a qualitative discussion of the 

likelihood of negative employment 

impacts at the various TSLs. Finally, the 

employment impacts shown are 

independent of the employment impacts 

from the broader U.S. economy, which 

are documented in chapter 13 of the 

direct final rule TSD. 

Using the GRIM, DOE estimates that 

in the absence of amended energy 

conservation standards, there would be 

8,990 domestic production workers 

involved in manufacturing residential 

clothes washers in 2015. Using 2009 

Census Bureau data and interviews with 

manufacturers, DOE estimates that 

approximately 70 percent of residential 

clothes washers sold in the United 

States are manufactured domestically. 

Table V–11 shows the range of the 

impacts of potential amended energy 

conservation standards on U.S. 

production workers in the clothes 

washer industry. 


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32364 Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 

TABLE V–11—POTENTIAL CHANGES IN THE TOTAL NUMBER OF DOMESTIC RESIDENTIAL CLOTHES WASHER PRODUCTION

WORKERS IN 2015 

Base case TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

Total Number of Domestic 

Production Workers in 

2015 (without changes 

in production locations) 8,990 9,058 9,164 9,080 9,376 8,604 

Potential Changes in Domestic Production 

Workers in 2015 * ......... ............................ 68–(8,890) 174–(8,890) 90–(8,890) 386–(8,890) (386)–(8,890) 

* DOE presents a range of potential employment impacts. Numbers in parentheses indicate negative numbers. 

All examined TSLs show relatively 

minor impacts on domestic employment 

levels relative to total industry 

employment at the lower end of the 

range of impacts. At all TSLs, most of 

the design options analyzed by DOE do 

not greatly alter the labor content of the 

final product. For example, more 

complex wash cycles or larger basket 

sizes involve one-time changes to the 

final product but do not significantly 

change the number of steps required for 

the final assembly of the clothes washer 

(which would add labor). Because many 

manufacturers have recently introduced 

high efficiency products in the United 

States that meet or exceed the standards 

in today’s final rule, it is unlikely 

today’s direct final rule would greatly 

impact the sourcing decisions of these 

manufacturers. However, at higher 

TSLs, some of the design options 

analyzed greatly impact the ability of 

manufacturers to make product changes 

within existing platforms. The very 

large upfront capital costs at these levels 

(especially for introducing new frontloading clothes washer platforms) could 

influence the decision of manufacturers 

to relocate some or all of the domestic 

production of these clothes washers to 

lower labor cost countries. 

c. Impacts on Manufacturing Capacity 

Most shipments of top-loading 

residential clothes washers fall below 

the 2015 and 2018 amended energy 

conservation standards. However, in 

response to the EISA 2007 water factor 

requirements, multiple manufacturers 

have modified baseline products to 

comply with these more stringent 

regulations. These changes were 

incremental modifications to lowerefficiency platforms. The 2015 

efficiency requirements would also 

involve modifications to lower-end 

platforms for top-loading clothes 

washers for all manufacturers, but 

would similarly not require completely 

new platforms at a significantly higher 

upfront cost. In addition, multiple 

manufacturers have recently introduced 

new top-loading clothes washers that 

meet substantially higher efficiencies 

than lower-end products at the baseline 

efficiency today. The introduction of 

these platforms mitigates the required 

capital conversion costs for the industry 

to meet the 2018 top-loading energy 

conservation standards. DOE believes 

that the mitigated capital conversion 

costs for manufacturers that have 

already introduced high-efficiency toploading clothes washers, as well as the 

additional 3 years for all remaining 

manufacturers to meet the more efficient 

standards for top-loading clothes 

washers in 2018, will allow the industry 

to meet demand and continue to offer a 

full range of products after the 

compliance date. 

More than 70 percent of front-loading 

shipments current meet the frontloading energy conservation standards 

in today’s direct final rule. In addition, 

every manufacturer that ships frontloading clothes washers offers products 

at the amended energy conservation 

standard. Since manufacturers will not 

have to make extensive platform 

changes but will need to increase the 

production of existing product by the 

2015 compliance date, the experience of 

multiple front-loading manufacturers 

that already produce standardscompliant front-loading clothes washers 

will allow the industry to meet the 

amended energy conservation standards 

proposed in the direct final rule. 

d. Impacts on Sub-Groups of 

Manufacturers 

Using average cost assumptions to 

develop an industry cash-flow estimate 

may not be adequate for assessing 

differential impacts among 

manufacturer subgroups. Small 

manufacturers, niche equipment 

manufacturers, and manufacturers 

exhibiting a cost structure substantially 

different from the industry average 

could be affected disproportionately. 

DOE analyzed the impacts to small 

business, as discussed in section VI.B. 

DOE did not identify any other 

subgroups for residential clothes 

washers for this rulemaking. 

e. Cumulative Regulatory Burden 

While any one regulation may not 

impose a significant burden on 

manufacturers, the combined effects of 

several 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 can 

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. 

Manufacturers provided comment on 

some of these regulations during the 

framework stage of this rulemaking. 

DOE summarizes and addresses these 

comments in section IV.I.3.a. For the 

cumulative regulatory burden, DOE 

attempts to quantify or describe the 

impacts of other Federal regulations that 

have a compliance date within 

approximately 3 years of the compliance 

date of this rulemaking. Most of the 

major regulations that meet this criteria 

identified by DOE are other energy 

conservation standards for products and 

equipment made by manufacturers of 

residential clothes washers. See chapter 

12 of the direct final rule TSD for the 

results of DOE’s analysis of the 

cumulative regulatory burden. 

3. National Impact Analysis 

a. Significance of Energy Savings 

To estimate the energy savings 

through 2044 attributable to potential 

standards for clothes washers, DOE 

compared the energy consumption of 

those products under the base case to 

their anticipated energy consumption 

under each TSL. Table V–12 presents 

DOE’s forecasts of the national energy 


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Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 32365 

43National energy and water savings are 

cumulative over a 30-year period. Any savings for 

products entering the housing stock in this 30-year period which occur beyond the 30-year time limit 

are not reported in the national totals. 

savings for each TSL for clothes 

washers, and Table V–13 presents 

forecasts of the national water savings.43

The savings were calculated using the 

approach described in section IV.G. 

Chapter 10 of the direct final rule TSD 

presents tables that also show the 

magnitude of the energy savings if the 

savings are discounted at rates of 7 

percent and 3 percent. Discounted 

energy savings represent a policy 

perspective in which energy savings 

realized farther in the future are less 

significant than energy savings realized 

in the nearer term. 

TABLE V–12—CLOTHES WASHERS: CUMULATIVE NATIONAL ENERGY SAVINGS

Energy (quads) 

Trial standard level 

1 2 3 4 5 

Standard Size .......................................................................................... 1.52 1.43 1.98 2.81 3.27

Compact Size ........................................................................................... 0.04 0.04 0.05 0.05 0.05

TABLE V–13—CLOTHES WASHERS: CUMULATIVE NATIONAL WATER SAVINGS

Water (trillion gallons) 

Trial standard level 

1 2 3 4 5 

Standard Size .......................................................................................... 1.12 1.06 3.01 5.31 6.87

Compact Size ........................................................................................... ¥0.01 ¥0.01 0.02 0.02 0.02 

b. Net Present Value of Consumer Costs 

and Benefits 

DOE estimated the cumulative NPV to 

the nation of the total costs and savings 

for consumers that would result from 

particular standard levels for clothes 

washers. In accordance with the OMB’s 

guidelines on regulatory analysis (OMB 

Circular A–4, section E, September 17, 

2003), DOE calculated NPV using both 

a 7-percent and a 3-percent real 

discount rate. The 7-percent rate is an 

estimate of the average before-tax rate of 

return to private capital in the U.S. 

economy, and reflects the returns to real 

estate and small business capital as well 

as corporate capital. DOE used this 

discount rate to approximate the 

opportunity cost of capital in the private 

sector, since recent OMB analysis has 

found the average rate of return to 

capital to be near this rate. In addition, 

DOE used the 3-percent rate to capture 

the potential effects of standards on 

private consumption (e.g., through 

higher prices for products and the 

purchase of reduced amounts of energy). 

This rate represents the rate at which 

society discounts future consumption 

flows to their present value. This rate 

can be approximated by the real rate of 

return on long-term government debt 

(i.e., yield on Treasury notes minus 

annual rate of change in the Consumer 

Price Index), which has averaged about 

3 percent on a pre-tax basis for the last 

30 years. 

Table V–14 shows the consumer NPV 

results for each TSL DOE considered for 

clothes washers, using a 3-percent and 

a 7-percent discount rate. The impacts 

are counted over the lifetime of 

products purchased in 2015–2044. 

TABLE V–14—CLOTHES WASHERS: CUMULATIVE NET PRESENT VALUE OF CONSUMER BENEFITS, 3- AND 7-PERCENT

DISCOUNT RATE* 

Discount rate 

Trial standard level 

1 2 3 4 5 

Billion 2010$ 

3 percent: 

Standard ................................................................................. 19 .9 18 .1 30 .7 41 .0 49 .9 

Compact .................................................................................. 0 .32 0 .32 0 .56 0 .58 0 .58 

7 percent: 

Standard ................................................................................. 8 .6 7 .6 12 .8 16 .2 19 .7 

Compact .................................................................................. 0 .14 0 .14 0 .23 0 .24 0 .24 

* The impacts are counted over the lifetime of products purchased in 2015–2044. 

The NPV results presented in Table 

V–14 are based on the default product 

price trend. As discussed in section 

IV.G.3, DOE developed several 

sensitivity cases with alternative 

forecasts of future prices of clothes 

washers. The impact of these alternative 

forecasts on the NPV results is 

presented in appendix 10–C of the 

direct final rule TSD. 

Circular A–4 requires agencies to 

present analytical results, including 

separate schedules of the monetized 

benefits and costs that show the type 

and timing of benefits and costs. 

Circular A–4 also directs agencies to 

consider the variability of key elements 

underlying the estimates of benefits and 

costs. DOE believes its standard 30-year 

analysis is fully compliant with Circular 

A–4. For this rulemaking, DOE 

undertook an additional sensitivity 

analysis of its standard 30-year analysis, 

in compliance with Circular A–4, using 

a 9-year analytical period. The choice of 

a 9-year period is a proxy for the 


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32366 Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 

44EPCA requires DOE to review its standards at 

least once every 6 years, and requires, for certain 

products including clothes washers, 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 standards established in this 

direct final rule. 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 does not reflect the 

variability that may occur in the timing of standards 

reviews and the fact that for some consumer 

products, the compliance period is 5 years rather 

than 3 years. 

45National energy and water savings are 

cumulative over the 9-year period. Any savings for 

products entering the housing stock in this 9-year 

period which occur beyond the 9-year time limit are 

not reported in the national totals. 

timeline in EPCA for the review of the 

energy conservation standard 

established in this direct final rule and 

potential revision of and compliance 

with a new standard for clothes 

washers.44 The review timeframe 

established in EPCA generally does not 

overlap with the product lifetime, 

product manufacturing cycles or other 

factors specific to residential clothes 

washers. Thus, this information is 

presented for informational purposes 

only and is not indicative of any change 

in DOE’s analytical methodology. 

The sensitivity analysis results based 

on a 9-year analytical period are 

presented below. Table V–15 presents 

DOE’s forecasts of the national energy 

savings for each TSL for clothes 

washers, and Table V–16 presents 

forecasts of the national water savings.45

Table V–17 shows the consumer NPV 

results for each TSL DOE considered for 

clothes washers, using a 3-percent and 

a 7-percent discount rate. For 

determination of the NPV, the impacts 

are counted over the lifetime of 

products purchased in 2015–2023 (note 

that the average lifetime of a clothes 

washer is 14.2 years, which is longer 

than the 9-year analysis period; thus, 

the NPV estimate incorporates all of the 

operating cost savings of clothes 

washers purchased in the 9 year 

analytical period). 

TABLE V–15—CLOTHES WASHERS: CUMULATIVE NATIONAL ENERGY SAVINGS, NINE-YEAR ANALYSIS PERIOD

Energy (quads) 

Trial standard level 

1 2 3 4 5 

Standard Size .......................................................................................... 0.23 0.21 0.27 0.41 0.48

Compact Size ........................................................................................... 0.01 0.01 0.01 0.01 0.01

TABLE V–16—CLOTHES WASHERS: CUMULATIVE NATIONAL WATER SAVINGS, NINE-YEAR ANALYSIS PERIOD

Water (trillion gallons) 

Trial standard level 

1 2 3 4 5 

Standard Size .......................................................................................... 0.17 0.14 0.37 0.78 1.02

Compact Size ........................................................................................... 0.00 0.00 0.00 0.00 0.00

TABLE V–17—CLOTHES WASHERS: CUMULATIVE NET PRESENT VALUE OF CONSUMER BENEFITS, 3- AND 7-PERCENT

DISCOUNT RATES, NINE-YEAR ANALYSIS PERIOD* 

Discount rate 

Trial standard level 

1 2 3 4 5 

Billion 2010$ 

3 percent: 

Standard ........................................................................................... 7.40 6.48 10.60 14.21 17.35 

Compact ........................................................................................... 0.12 0.12 0.18 0.21 0.21 

7 percent: 

Standard ........................................................................................... 4.31 3.68 5.99 7.53 9.18 

Compact ........................................................................................... 0.07 0.07 0.10 0.12 0.12 

* The impacts are counted over the lifetime of products purchased in 2015–2023. 

c. Indirect Impacts on Employment 

DOE develops estimates of the 

indirect employment impacts of 

potential standards on the economy in 

general. As discussed above, DOE 

expects energy conservation standards 

for clothes washers to reduce energy 

bills for consumers of those products, 

and the resulting net savings to be 

redirected to other forms of economic 

activity. Those shifts in spending and 

economic activity could affect the 

demand for labor. As described in 

section IV.J, DOE used an input/output 

model of the U.S. economy to estimate 

indirect employment impacts of the 

TSLs that DOE considered in this 

rulemaking. DOE understands that 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 (2015– 

2020), where these uncertainties are 

reduced. 

The results suggest that today’s 

standards are likely to have 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 13 of the direct 

final rule TSD presents more detailed 

results. 

4. Impact on Utility or Performance of 

Products 

As presented in section III.D.1.d of 

this notice, DOE concluded that the TSL 

adopted in this direct final rule would 


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Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 32367 

46The analysis for today’s rule assumes the 

implementation of CAIR and does not take into 

account the recently issued (July 6, 2011) CrossState Air Pollution Rule. In future rulemakings, 

DOE will adjust its relevant models to reflect the 

implementation of the Cross-State Air Pollution 

Rule. 

not reduce the utility or performance of 

the clothes washers under consideration 

in this rulemaking. Manufacturers of 

these products currently offer units that 

meet or exceed today’s standards. (42 

U.S.C. 6295(o)(2)(B)(i)(IV)) 

5. Impact of Any Lessening of 

Competition 

DOE has also considered any 

lessening of competition that is likely to 

result from amended standards. The 

Attorney General determines the 

impact, if any, of any lessening of 

competition likely to result from a 

proposed standard, and transmits such 

determination to DOE, together with an 

analysis of the nature and extent of such 

impact. (42 U.S.C. 6295(o)(2)(B)(i)(V) 

and (B)(ii)) 

DOE published a NOPR containing 

energy conservation standards identical 

to those set forth in today’s direct final 

rule and transmitted a copy of today’s 

direct final rule and the accompanying 

TSD to the Attorney General, requesting 

that the DOJ provide its determination 

on this issue. DOE will consider DOJ’s 

comments on the rule in determining 

whether to proceed with the direct final 

rule. DOE will also publish and respond 

to DOJ’s comments in the Federal 

Register in a separate notice. 

6. Need of the Nation To Conserve 

Energy 

An improvement in the energy 

efficiency of the products subject to 

today’s rule is likely to improve the 

security of the nation’s energy system by 

reducing overall demand for energy. 

Reduced electricity demand may also 

improve the reliability of the electricity 

system. As a measure of this reduced 

demand, Table V–18 presents the 

estimated reduction in electricity 

generating capacity in 2044 for the TSLs 

that DOE considered in this rulemaking. 

TABLE V–18—REDUCTION IN ELECTRIC GENERATING CAPACITY IN 2044 UNDER TRIAL STANDARD LEVELS FOR CLOTHES

WASHERS

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

Gigawatts 

Clothes Washers ...................................................................................... 0.882 1.01 1.30 1.64 1.86 

Energy savings from amended 

standards for clothes washers are 

expected to produce environmental 

benefits in the form of reduced 

emissions of air pollutants and 

greenhouse gases associated with 

electricity production. Table V–19 

provides DOE’s estimate of cumulative 

CO2, NOX, and Hg emissions reductions 

that would be expected to result from 

the TSLs considered in this rulemaking. 

In the emissions analysis (chapter 15 of 

the direct final rule TSD), DOE reports 

annual CO2, NOX, and Hg emissions 

reductions for each TSL. 

As discussed in section IV.L, DOE has 

not reported SO2 emissions reductions 

from power plants because SO2

emissions caps have created uncertainty 

about the effect of energy conservation 

standards on the overall level of SO2

emissions in the United States. DOE 

also did not include NOX emissions 

reduction from power plants in States 

subject to CAIR because the emissions 

caps mandated by CAIR mean that an 

energy conservation standard would not 

affect the overall level of NOX emissions 

in those States.46

TABLE V–19—EMISSIONS REDUCTION ESTIMATED FOR CLOTHES WASHER TRIAL STANDARD LEVELS

[Cumulative in 2015–2044] 

TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

CO2 (million metric tons) .......................................................................... 87.65 81.96 112.90 155.51 178.82 

NOX (thousand tons) ............................................................................... 73.46 68.07 94.16 130.10 149.70 

Hg (tons) .................................................................................................. 0.198 0.226 0.269 0.364 0.413 

DOE also estimated monetary benefits 

likely to result from the reduced 

emissions of CO2 and NOX that DOE 

estimated for each of the TSLs 

considered for clothes washers. As 

discussed in section IV.M, DOE used 

values for the SCC developed by an 

interagency process. The four values for 

CO2 emissions reductions resulting from 

that process (expressed in 2010$) are 

$4.9/ton (the average value from a 

distribution that uses a 5-percent 

discount rate), $22.3/ton (the average 

value from a distribution that uses a 

3-percent discount rate), $36.5/ton (the 

average value from a distribution that 

uses a 2.5-percent discount rate), and 

$67.6/ton (the 95th-percentile value 

from a distribution that uses a 3-percent 

discount rate). These values correspond 

to the value of emission reductions in 

2010; the values for later years are 

higher due to increasing damages as the 

magnitude of climate change increases. 

For each of the four cases, DOE 

calculated a present value of the stream 

of annual values using the same 

discount rate as used in the studies 

upon which the dollar-per-ton values 

are based. Table V–20 presents the 

global values of CO2 emissions 

reductions at each TSL. DOE calculated 

domestic values as a range from 7 

percent to 23 percent of the global 

values. Those results are presented in 

Table V–21. 


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32368 Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 

TABLE V–20—ESTIMATES OF GLOBAL PRESENT VALUE OF CO2 EMISSIONS REDUCTIONS UNDER CLOTHES WASHER TRIAL

STANDARD LEVELS

TSL 

Million 2010$ 

5% discount rate, 

average* 

3% discount rate, 

average* 

2.5% discount 

rate, average* 

3% discount rate, 

95th percentile* 

1 ....................................................................................................... 410 2143 3645 6527 

2 ....................................................................................................... 384 2007 3414 6112 

3 ....................................................................................................... 530 2777 4727 8457 

4 ....................................................................................................... 729 3813 6488 11613 

5 ....................................................................................................... 838 4386 7462 13357 

* Columns are labeled by the discount rate used to calculate the SCC and whether it is an average value or drawn from a different part of the 

distribution. 

TABLE V–21—ESTIMATES OF DOMESTIC PRESENT VALUE OF CO2 EMISSIONS REDUCTIONS UNDER CLOTHES WASHER

TRIAL STANDARD LEVELS

TSL 

Million 2010$ * 

5% discount rate, average** 3% discount rate, average** 2.5% discount rate, 

average** 

3% discount rate, 95th 

percentile** 

1 ........................ 29 to 94 ................................. 150 to 493 ............................. 255 to 838 ............................. 457 to 1501. 

2 ........................ 27 to 88 ................................. 140 to 462 ............................. 239 to 785 ............................. 428 to 1406. 

3 ........................ 37 to 122 ............................... 194 to 639 ............................. 331 to 1087 ........................... 592 to 1945. 

4 ........................ 51 to 168 ............................... 267 to 877 ............................. 454 to 1492 ........................... 813 to 2671. 

5 ........................ 59 to 193 ............................... 307 to 1009 ........................... 522 to 1716 ........................... 935 to 3072. 

* Domestic values are presented as a range between 7 percent and 23 percent of the global values. 

** Columns are labeled by the discount rate used to calculate the SCC and whether it is an average value or drawn from a different part of the 

distribution. 

DOE is well aware that scientific and 

economic knowledge about the 

contribution of CO2 and other GHG 

emissions to changes in the future 

global climate and the potential 

resulting damages to the world economy 

continues to evolve rapidly. Thus, any 

value placed in this rulemaking on 

reducing CO2 emissions is subject to 

change. DOE, together with other 

Federal agencies, will continue to 

review various methodologies for 

estimating the monetary value of 

reductions in CO2 and other GHG 

emissions. This ongoing review will 

consider the comments on this subject 

that are part of the public record for this 

and other rulemakings, as well as other 

methodological assumptions and issues. 

However, consistent with DOE’s legal 

obligations, and taking into account the 

uncertainty involved with this 

particular issue, DOE has included in 

this final rule the most recent values 

and analyses resulting from the ongoing 

interagency review process. 

DOE also estimated a range for the 

cumulative monetary value of the 

economic benefits associated with NOX

emissions reductions anticipated to 

result from amended standards for 

clothes washers. The dollar-per-ton 

values that DOE used are discussed in 

section IV.M. Table V–22 presents the 

cumulative present values for each TSL 

calculated using 3-percent and 

7-percent discount rates. 

TABLE V–22—ESTIMATES OF PRESENT

VALUE OF NOX EMISSIONS REDUCTIONS UNDER CLOTHES WASHER

TRIAL STANDARD LEVELS

TSL 3% discount rate 

million 2010$ 

7% discount rate 

million 2010$ 

1 ...... 22 to 224 ............ 9 to 97. 

2 ...... 20 to 207 ............ 9 to 90. 

3 ...... 28 to 286 ............ 12 to 122. 

4 ...... 39 to 396 ............ 17 to 171. 

5 ...... 44 to 456 ............ 19 to 197. 

The NPV of the monetized benefits 

associated with emissions reductions 

can be viewed as a complement to the 

NPV of the consumer savings calculated 

for each TSL considered in this 

rulemaking. Table V–23 shows an 

example of the calculation of the 

combined NPV including benefits from 

emissions reductions for the case of TSL 

3 for front-loading clothes washers. 

Table V–24 and Table V–25 present the 

NPV values that result from adding the 

estimates of the potential economic 

benefits resulting from reduced CO2 and 

NOX emissions in each of four valuation 

scenarios to the NPV of consumer 

savings calculated for each TSL 

considered in this rulemaking, at both a 

7-percent and a 3-percent discount rate. 

The CO2 values used in the columns of 

each table correspond to the four 

scenarios for the valuation of CO2

emission reductions presented in 

section IV.M. 

TABLE V–23—ADDING NET PRESENT VALUE OF CONSUMER SAVINGS TO PRESENT VALUE OF MONETIZED BENEFITS

FROM CO2 AND NOX EMISSIONS REDUCTIONS AT TSL 3 

Category Present value 

(billion 2010$) 

Discount rate 

(%) 

Benefits 

Operating Cost Savings ............................................................................................................................... 15.3 7 

35.4 3 


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Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 32369 

TABLE V–23—ADDING NET PRESENT VALUE OF CONSUMER SAVINGS TO PRESENT VALUE OF MONETIZED BENEFITS

FROM CO2 AND NOX EMISSIONS REDUCTIONS AT TSL 3—Continued 

Category Present value 

(billion 2010$) 

Discount rate 

(%) 

CO2 Reduction Monetized Value (at $4.9/t)* .............................................................................................. 0.53 5 

CO2 Reduction Monetized Value (at $22.3/t)* ............................................................................................ 2.78 3 

CO2 Reduction Monetized Value (at $36.5/t)* ............................................................................................ 4.73 2.5 

CO2 Reduction Monetized Value (at $67.6/t)* ............................................................................................ 8.46 3 

NOX Reduction Monetized Value (at $2,537/Ton)* ..................................................................................... 0.07 7 

0.16 3 

Costs 

Total Incremental Installed Costs ................................................................................................................ 2.30 7 

4.15 3 

Net Benefits/Costs 

Net Benefits, Including CO2 and NOX** ...................................................................................................... 15.9 7 

34.2 3 

* These values represent global values (in 2010$) of the social cost of CO2 emissions in 2010 under several scenarios. See section IV.M for a 

discussion of the derivation of these values. The value for NOX (in 2010$) is the average of the low and high values used in DOE’s analysis. 

** Net Benefits for both the 3% and 7% cases utilize the central estimate of social cost of CO2 emissions calculated at a 3% discount rate, 

which is equal to $21.4/ton in 2010 (in 2010$). 

TABLE V–24—RESULTS OF ADDING NET PRESENT VALUE OF CONSUMER SAVINGS (AT 7% DISCOUNT RATE) TO NET

PRESENT VALUE OF MONETIZED BENEFITS FROM CO2 AND NOX EMISSIONS REDUCTIONS UNDER CLOTHES WASHER

TRIAL STANDARD LEVELS

TSL 

Consumer NPV at 7% discount rate added with: 

SCC Value of $4.9/metric ton 

CO2* and low value for 

NOX** 

billion 2010$ 

SCC Value of $22.3/metric 

ton CO2* and medium value 

for NOX** 

billion 2010$ 

SCC Value of $36.5/metric 

ton CO2* and medium value 

for NOX** 

billion 2010$ 

SCC Value of $67.6/metric 

ton CO2* and high value for 

NOX** 

billion 2010$ 

1 ........................ 9.1 10.9 12.4 15.4 

2 ........................ 8.2 9.8 11.2 14.0 

3 ........................ 13.6 15.9 17.8 21.6 

4 ........................ 17.2 20.3 23.0 28.2 

5 ........................ 20.8 24.4 27.5 33.5 

* These label values represent the global SCC of CO2 in 2010, in 2010$. Their present values have been calculated with scenario-consistent 

discount rates. See section IV.M for a discussion of the derivation of these values. 

** Low Value corresponds to $450 per ton of NOX emissions. Medium Value corresponds to $2,537 per ton of NOX emissions. High Value corresponds to $4,623 per ton of NOX emissions. 

TABLE V–25—RESULTS OF ADDING NET PRESENT VALUE OF CONSUMER SAVINGS (AT 3% DISCOUNT RATE) TO NET

PRESENT VALUE OF MONETIZED BENEFITS FROM CO2 AND NOX EMISSIONS REDUCTIONS UNDER CLOTHES WASHER

TRIAL STANDARD LEVELS

TSL 

Consumer NPV at 3% discount rate added with: 

SCC Value of $4.9/metric ton 

CO2* and low value for 

NOX** 

billion 2010$ 

SCC Value of $22.3/metric 

ton CO2* and medium value 

for NOX** 

billion 2010$ 

SCC Value of $36.5/metric 

ton CO2* and medium value 

for NOX** 

billion 2010$ 

SCC Value of $67.6/metric 

ton CO2* and high value for 

NOX** 

billion 2010$ 

1 ........................ 20.6 22.4 23.9 26.9 

2 ........................ 18.9 20.6 22.0 24.8 

3 ........................ 31.8 34.2 36.2 40.0 

4 ........................ 42.4 45.6 48.3 53.6 

5 ........................ 51.4 55.1 58.2 64.3 

* These label values represent the global SCC of CO2 in 2010, in 2010$. Their present values have been calculated with scenario-consistent 

discount rates. See section IV.M for a discussion of the derivation of these values. 

** Low Value corresponds to $450 per ton of NOX emissions. Medium Value corresponds to $2,537 per ton of NOX emissions. High Value corresponds to $4,623 per ton of NOX emissions. 

Although adding the value of 

consumer savings to the values of 

emission reductions provides a valuable 

perspective, two issues should be 

considered. First, the national operating 

cost savings are domestic U.S. consumer 

monetary savings that occur as a result 

of market transactions, while the value 

of CO2 reductions is based on a global 

value. Second, the assessments of 

operating cost savings and CO2 savings 

are performed with different methods 


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32370 Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 

47P.C. Reiss and M.W. White. Household 

Electricity Demand, Revisited. Review of Economic 

Studies (2005) 72, 853–883. 

48Alan Sanstad. ‘‘Notes on the Economics of 

Household Energy Consumption and Technology 

Choice.’’ Lawrence Berkeley National Laboratory. 

2010. Available online at: www1.eere.energy.gov/ 

buildings/appliance_standards/pdfs/ 

consumer_ee_theory.pdf. 

that use quite different time frames for 

analysis. The national operating cost 

savings is measured for the lifetime of 

products shipped in 2015–2044. The 

SCC values, on the other hand, reflect 

the present value of all future climaterelated impacts resulting from the 

emission of one ton of carbon dioxide in 

each year. These impacts continue well 

beyond 2100. 

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)(VI))) In developing the 

direct final rule, DOE has also 

considered the Joint Petition submitted 

to DOE. DOE recognizes the value of 

consensus agreements submitted by 

parties in accordance with 42 U.S.C. 

6295(p)(4) and has weighed the value of 

such consensus in establishing the 

standards set forth in today’s final rule. 

DOE has encouraged the submission of 

consensus agreements as a way to get 

diverse interested parties together, to 

develop an independent and probative 

analysis useful in DOE standard setting, 

and to expedite the rulemaking process. 

DOE also believes that standard levels 

recommended in the consensus 

agreement may increase the likelihood 

for regulatory compliance, while 

decreasing the risk of litigation. 

C. Conclusion 

When considering proposed 

standards, the new or amended energy 

conservation standard that DOE adopts 

for any type (or class) of covered 

product shall 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 to the greatest extent 

practicable, in light of 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)) 

The Department considered the 

impacts of standards at each trial 

standard level, beginning with 

maximum technologically feasible level, 

to determine whether that level was 

economically justified. Where the maxtech level was not justified, DOE then 

considered the next most efficient level 

and undertook the same evaluation until 

it reached the highest efficiency level 

that is both technologically feasible and 

economically justified and saves a 

significant amount of energy. 

To aid the reader as DOE discusses 

the benefits and/or burdens of each trial 

standard level, tables 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. Those 

include the impacts on identifiable 

subgroups of consumers, such as lowincome households and seniors, who 

may be disproportionately affected by a 

national standard. Section V.B.1 

presents the estimated impacts of each 

TSL for these subgroups. 

As background for the consideration 

of benefits from energy efficiency 

standards, DOE notes that the 

economics literature provides a wideranging discussion of how consumers 

trade off upfront costs and energy 

savings in the absence of government 

intervention. Much of this literature 

attempts to explain why consumers 

appear to undervalue energy efficiency 

improvements. This undervaluation 

suggests that regulation that promotes 

energy efficiency can produce 

significant net private gains (as well as 

producing social gains by, for example, 

reducing pollution). There is evidence 

that consumers undervalue future 

energy savings as a result of (1) a lack 

of information; (2) a lack of sufficient 

salience of the long-term or aggregate 

benefits; (3) excessive focus on the short 

term, in the form of inconsistent 

weighting of future energy cost savings 

relative to available returns on other 

investments; (4) computational or other 

difficulties associated with the 

evaluation of relevant tradeoffs; and (5) 

a divergence in incentives (that is, 

renter vs. owner or builder vs. 

purchaser). Other literature indicates 

that with less than perfect foresight and 

a high degree of uncertainty about the 

future, consumers may trade off these 

types of investments at a higher than 

expected rate between current 

consumption and uncertain future 

energy cost savings. 

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 a purchase of a 

product in the standards case, this 

decreases sales for product 

manufacturers and the cost to 

manufacturers 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 regulatory option 

decreases the number of products used 

by consumers, this decreases the 

potential energy savings from an energy 

conservation standard. DOE provides 

detailed estimates of shipments and 

changes in the volume of product 

purchases in chapter 9 of the direct final 

rule 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 (Reiss 

and White, 2005).47

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 efficiency 

standards, and potential enhancements 

to the methodology by which these 

impacts are defined and estimated in 

the regulatory process.48

DOE also conducted an analysis of the 

impacts on consumer welfare of the 

standards on clothes washers that 

required compliance in January 2007. 

This analysis assumes consumers made 

washer purchase decisions optimally 

(i.e., taking full account of the tradeoff 

between up-front cost and future energy 

costs) and infers welfare implications 

based on price and quantity changes 

that occurred around the time of the 

standard change. The analysis assumes 

the 2007 policy change sharply reduced 

supply of low-efficiency units, which in 

turn sharply increased demand for 

higher-efficiency units. 

The analysis used market survey data 

on total sales of washers purchased in 

the United States, with measures for 

units sold and average price broken 

down by washer brand and model. 

Values are reported for each month. The 

data include a limited number of 

attributes for each model, plus a 

measure of energy efficiency in terms of 

kilowatt-hours per year (kWh/y) for 

standard usage. The analysis used the 


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Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 32371 

49Uri Ronnen. Minimum quality standards, fixed 

costs, and competition. RAND Journal of 

Economics. Vol. 22, No. 4, Winter 1991. 

kWh/y measure to proxy for washers 

that may have been closer and farther 

from the 2007 standard and ENERGY 

STAR specifications. 

The net change in consumer welfare 

can be inferred from (a) the gain and/or 

loss from consumer welfare from 

increased purchases of higher-efficiency 

units minus (b) the loss in consumer 

welfare from reduced purchase of lowerefficiency units. Because washer units 

banned from manufacture in 2007 were 

still available for purchase for some 

months after the ban, observed changes 

in prices and quantities of the lower 

efficiency units facilitates estimation of 

(b). The data show that prices for these 

units increased slightly while quantities 

sold declined sharply. This suggests 

consumer welfare losses in (a) were 

modest. The data further show that 

prices of higher-efficiency units 

declined with the 2007 standard, in 

some cases markedly so. These price 

declines suggest that the welfare gains 

in (a) are quite substantial, and although 

the total gain cannot be inferred, any 

lower-bound estimate would indicate 

that these gains far exceed losses in (b). 

These inferred gains to consumers 

from the 2007 change in standards 

appears to have less to do with energy 

efficiency than with the way standards 

affect costs of production for highefficiency units, and possibly with the 

way standards influence competition 

among washer-producing firms (e.g., see 

Ronnen, 1991).49 As the scale of 

production of high efficiency units 

increased, production costs and/or 

markups by washer manufacturers fell, 

thereby increasing consumer welfare. 

The analysis is described in appendix 

8–F of the direct final rule TSD. 

DOE welcomes comments on 

approaches for improved assessment of 

the consumer welfare impacts of 

appliance standards. 

1. Benefits and Burdens of TSLs 

Considered for Residential Clothes 

Washers 

Table V–26 and Table V–27 

summarize the quantitative impacts 

estimated for each TSL for residential 

clothes washers. The efficiency levels 

contained in each TSL are described in 

section V.A. 

TABLE V–26—SUMMARY OF RESULTS FOR CLOTHES WASHER TRIAL STANDARD LEVELS: NATIONAL IMPACTS

Category TSL 1 TSL 2 TSL 3 TSL 4 TSL 5 

National Energy Savings (quads) ......................... 1.56 .................. 1.46 .................. 2.04 .................. 2.87 .................. 3.32. 

National Water Savings (trillion gal.) .................... 1.11 .................. 1.05 .................. 3.03 .................. 5.33 .................. 6.89. 

NPV of Consumer Benefits (2010$ billion): 

3% discount rate ............................................ 20.2 .................. 18.5 .................. 31.29 ................ 41.60 ................ 50.48. 

7% discount rate ............................................ 8.7 .................... 7.77 .................. 13.01 ................ 16.42 ................ 19.92. 

Cumulative Emissions Reduction: 

CO2 (million metric tons) ............................... 87.65 ................ 81.96 ................ 112.90 .............. 155.51 .............. 178.82. 

NOX (thousand tons) ..................................... 73.46 ................ 68.07 ................ 94.16 ................ 130.10 .............. 149.70. 

Hg (tons) ........................................................ 0.198 ................ 0.226 ................ 0.269 ................ 0.364 ................ 0.413. 

Value of Cumulative Emissions Reduction: 

CO2 (2010$ million) * ..................................... 410 to 6527 ...... 384 to 6112 ...... 530 to 8457 ...... 729 to 11613 .... 838 to 13357. 

NOX ¥ 3% discount rate (2010$ million) ..... 22 to 224 .......... 20 to 207 .......... 28 to 286 .......... 39 to 396 .......... 44 to 456. 

NOX ¥ 7% discount rate (2010$ million) ..... 9 to 97 .............. 9 to 90 .............. 12 to 122 .......... 17 to 171 .......... 19 to 197. 

Generation Capacity Reduction (GW) ** ............... 0.882 ................ 1.01 .................. 1.30 .................. 1.64 .................. 1.86. 

Parentheses indicate negative (¥) values. 

* Range of the economic value of CO2 reductions is based on estimates of the global benefit of reduced CO2 emissions. 

** Changes in 2044. 

TABLE V–27—SUMMARY OF RESULTS FOR CLOTHES WASHER TRIAL STANDARD LEVELS: CONSUMER AND MANUFACTURER

IMPACTS

Category TSL 1 TSL 2 TSL 3 * TSL 4 TSL 5 

Manufacturer Impacts 

Industry NPV (2010$ million) ................. (56.3) ¥ (64.0) (14.3) ¥ (490.3) 96.4 ¥ (858.8) 205.0 ¥ (1,256.4) 255.5 ¥ (1,335.3) 

Industry NPV (% change) ...................... (2.2) ¥ (2.5) (0.6) ¥ (19.0) 3.7 ¥ (33.2) 7.9 ¥ (48.6) 9.9 ¥ (51.6) 

Consumer Mean LCC Savings (2010$) 

Top-Loading Standard Clothes Washer 268 243 268/366 491 524 

Front-Loading Standard Clothes Washer ........................................................ NA ** 2.2 37 35 102 

Top-Loading Compact Clothes Washer 159 159 159/312 312 312 

Front-Loading Compact Clothes Washer ........................................................ 54 54 54 54 54 

Consumer Median PBP (years) 

Top-Loading Standard Clothes Washer 0.4 0.7 0.4/0.9 1.8 1.9 

Front-Loading Standard Clothes Washer ........................................................ NA * 0.9 1.3 9.2 5.2 

Top-Loading Compact Clothes Washer 0.5 0.5 0.5/2.1 2.1 2.1 


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TABLE V–27—SUMMARY OF RESULTS FOR CLOTHES WASHER TRIAL STANDARD LEVELS: CONSUMER AND MANUFACTURER

IMPACTS—Continued 

Category TSL 1 TSL 2 TSL 3 * TSL 4 TSL 5 

Front-Loading Compact Clothes Washer ........................................................ 0.8 0.8 0.8 0.8 0.8 

Distribution of Consumer LCC Impacts 

Top-Loading Standard Clothes Washer: 

Net Cost (%) ................................... 0.7 5.6 0.7/3.4 8.1 9.5 

No Impact (%) ................................. 19.5 15.1 19.5/14.1 4.6 0.0 

Net Benefit (%) ............................... 79.8 79.3 79.8/82.5 87.4 90.5 

Front-Loading Standard Clothes Washer: 

Net Cost (%) ................................... 0.0 0.1 1.5 45.1 29.6 

No Impact (%) ................................. 100.0 96.0 72.4 11.6 0.0 

Net Benefit (%) ............................... 0.0 3.9 26.1 43.3 70.4 

Top-Loading Compact Clothes Washer: 

Net Cost (%) ................................... 1.5 1.5 1.5/12.6 12.6 12.6 

No Impact (%) ................................. 0.0 0.0 0.0 0.0 0.0 

Net Benefit (%) ............................... 98.5 98.5 98.5/87.4 87.4 87.4 

Front-Loading Compact Clothes Washer: 

Net Cost (%) ................................... 0.0 0.0 0.0 0.0 0.0 

No Impact (%) ................................. 0.0 0.0 0.0 0.0 0.0 

Net Benefit (%) ............................... 100.0 100.0 100.0 100.0 100.0 

Parentheses indicate negative (¥) values. 

* For top-loading clothes washers under TSL 3, the first number for consumer impacts refers to the standard in 2015, and the second number 

refers to the standard in 2018. 

** The standard level is the same as the baseline efficiency level, so no consumers are impacted and therefore calculation of a payback period 

is not applicable. 

DOE first considered TSL 5, which 

represents the max-tech efficiency 

levels. TSL 5 would save 3.32 quads of 

energy and 6.89 trillion gallons of water, 

amounts DOE considers significant. 

Under TSL 5, the NPV of consumer 

benefit would be $19.92 billion, using a 

discount rate of 7 percent, and $50.48 

billion, using a discount rate of 3 

percent. 

The cumulative emissions reductions 

at TSL 5 are 179 Mt of CO2, 150 

thousand tons of NOX, and 0.413 ton of 

Hg. The estimated monetary value of the 

CO2 emissions reductions at TSL 5 

ranges from $838 million to $13,357 

million. Total generating capacity in 

2043 is estimated to decrease by 1.86 

GW under TSL 5. 

At TSL 5, the average LCC impact is 

a savings (LCC decrease) of $524 for toploading standard clothes washers, a 

savings of $102 for front-loading 

standard clothes washers, a savings of 

$312 for top-loading compact clothes 

washers, and a savings of $54 for frontloading compact clothes washers. The 

median payback period is 1.9 years for 

top-loading standard clothes washers, 

5.2 years for front-loading standard 

clothes washers, 2.1 years for toploading compact clothes washers, and 

0.8 years for front-loading compact 

clothes washers. A significant fraction 

of consumers, however, experience an 

LCC increase or net cost under TSL 5 for 

all product classes except front-loading 

compact: 9.5 percent for top-loading 

standard clothes washers, 30 percent for 

front-loading standard clothes washers, 

and 13 percent for top-loading compact 

clothes washers. In addition, because 

TSL 5 significantly raises the first cost 

of both top-loading and front-loading 

clothes washers, DOE is concerned 

some low-income consumers may be 

compelled to delay or forgo new 

purchases, using commercial coin 

laundries or repairing their existing 

clothes washers instead. 

At TSL 5, the projected change in 

INPV ranges from an increase of $255.5 

million to a decrease of $1,335.3 

million. At this TSL, manufacturers 

would have to overhaul both their frontloading and top-loading platforms by 

the 2015 compliance date to meet 

demand. Redesigning all units to meet 

the current max-tech efficiency levels 

would require considerable capital and 

product conversion expenditures. DOE 

believes that the scope of the redesigns 

necessary to meet TSL 5 by 2015 also 

heightens concerns over supply chain 

and operational risk. DOE estimates that 

complete platform redesigns would cost 

the industry over $700 million in 

product and capital conversion costs. 

These costs alone represent a substantial 

portion of the total value of the 

industry. In addition, manufacturers 

could face a substantial impact on 

profitability at TSL 5. Because 

manufacturers earn a premium for 

ENERGY STAR products and additional 

profit for products that exceed the 

ENERGY STAR level, collapsing the 

market to one commodity product 

makes it unlikely that manufacturers 

could maintain their base-case 

profitability on these products after 

compliance with the standards is 

required. As a result, DOE expects that 

TSL 5 would yield impacts closer to the 

high end of the range of INPV impacts. 

If the high end of the range of impacts 

is reached, as DOE expects, TSL 5 could 

result in a net loss of 51.6 percent in 

INPV to clothes washer manufacturers. 

The Secretary concludes that at TSL 

5 for residential clothes washers, the 

benefits of energy savings, water 

savings, positive NPV of consumer 

benefits, generating capacity reductions, 

emission reductions, and the estimated 

monetary value of the CO2 emissions 

reductions would be outweighed by the 

significant fraction of consumers that 

experience an increase in life-cycle cost 

and the impacts on manufacturers, 

including the conversion costs and 

profit margin impacts that could result 

in a very large reduction in INPV for the 

manufacturers and the risk of 

manufacturer capacity constraints 

resulting from the necessary changes by 

2015. Consequently, the Secretary has 


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concluded that TSL 5 is not 

economically justified. 

DOE next considered TSL 4. TSL 4 

would save 2.87 quads of energy and 

5.33 trillion gallons of water, amounts 

DOE considers significant. Under TSL 4, 

the NPV of consumer benefit would be 

16.42 billion, using a discount rate of 7 

percent, and $41.60 billion, using a 

discount rate of 3 percent. 

The cumulative emissions reductions 

at TSL 4 are 156 Mt of CO2, 130 

thousand tons of NOX, and 0.364 tons of 

Hg. The estimated monetary value of the 

CO2 emissions reductions at TSL 4 

ranges from $729 million to $11,613 

million. Total generating capacity in 

2044 is estimated to decrease by 1.64 

GW under TSL 4. 

At TSL 4, the average LCC impact is 

a savings of $491 for top-loading 

standard clothes washers, a savings of 

$35 for front-loading standard clothes 

washers, a savings of $312 for toploading compact clothes washers, and a 

savings of $54 for front-loading compact 

clothes washers. The median payback 

period is 1.8 years for top-loading 

standard clothes washers, 9.2 years for 

front-loading standard clothes washers, 

2.1 years for top-loading compact 

clothes washers, and 0.8 years for frontloading compact clothes washers. A 

significant fraction of consumers, 

however, experience an LCC net cost for 

all product classes except front-loading 

compact: 8 percent for top-loading 

standard clothes washers, 45 percent for 

front-loading standard clothes washers, 

and 13 percent for top-loading compact 

clothes washers. In addition, TSL 4 

significantly raises the first cost of both 

top-loading and front-loading clothes 

washers, and DOE is concerned some 

low-income consumers may be 

compelled to delay or forgo new 

purchases. 

At TSL 4, the projected change in 

INPV ranges from an increase of $205.0 

million to a decrease of $1,256.4 

million. At this TSL, manufacturers 

would be required to overhaul both 

front-loading and top-loading platforms 

by the 2015 compliance date to meet 

demand. DOE estimates that it would 

cost the industry approximately $692 

million in product and capital 

conversion costs at TSL 4. These costs 

reflect substantial platform changes to 

both top-loading and front-loading 

clothes washers by 2015, represent a 

significant portion of the total value of 

the industry, and trigger capacity 

concerns in light of the magnitude and 

timing of the necessary changes. In 

addition, manufacturers could face a 

substantial impact on profitability at 

TSL 4. Because manufacturers earn a 

premium for ENERGY STAR products 

and additional profit for products that 

exceed the ENERGY STAR level, 

collapsing the market to a few 

commodity products without efficiency 

differentiators makes it unlikely that 

manufactures could maintain their basecase profitability on these products after 

standards. Because of the effect, DOE 

expects that TSL 4 would yield impacts 

closer to the high end of the range of 

INPV impacts. If the high end of the 

range of impacts is reached, as DOE 

expects, TSL 4 could result in a net loss 

of 48.6 percent in INPV to clothes 

washer manufacturers. 

The Secretary concludes that at TSL 

4 for residential clothes washers, the 

benefits of energy savings, water 

savings, positive NPV of consumer 

benefits, generating capacity reductions, 

emission reductions, and the estimated 

monetary value of the CO2 emissions 

reductions would be outweighed by the 

economic burden on a significant 

fraction of consumers due to the large 

increase in product cost and the impacts 

on manufacturers, including the 

conversion costs and profit margin 

impacts that could result in a very large 

reduction in INPV for manufacturers 

and the risk of manufacturer capacity 

constraints resulting from the necessary 

changes by 2015. Consequently, the 

Secretary has concluded that TSL 4 is 

not economically justified. 

DOE then considered TSL 3. TSL 3 

would save 2.04 quads of energy and 

3.03 trillion gallons of water, amounts 

DOE considers significant. Under TSL 3, 

the NPV of consumer benefit would be 

$13.01 billion, using a discount rate of 

7 percent, and $31.29 billion, using a 

discount rate of 3 percent. 

The cumulative emissions reductions 

at TSL 3 are 113 Mt of CO2, 94.2 

thousand tons of NOX, and 0.269 ton of 

Hg. The estimated monetary value of the 

CO2 emissions reductions at TSL 3 

ranges from $530 million to $8,457 

million. Total generating capacity in 

2045 is estimated to decrease by 1.30 

GW under TSL 3. 

At TSL 3, the average LCC impact is 

a savings of $268 in 2015 and $366 in 

2018 for top-loading standard clothes 

washers, a savings of $37 for frontloading standard clothes washers, a 

savings of $159 in 2015 and $312 in 

2018 for top-loading compact clothes 

washers, and a savings of $54 for frontloading compact clothes washers. The 

median payback period is 0.4 years in 

2015 and 0.9 years in 2018 for toploading standard clothes washers, 1.3 

years for front- loading standard clothes 

washers, 0.5 years in 2015 and 2.1 years 

in 2018 for top-loading compact clothes 

washers, and 0.8 years for front-loading 

compact clothes washers. The fraction 

of consumers experiencing an LCC cost 

is small—less than 1 percent in 2015 

and 3 percent in 2018 for top-loading 

standard clothes washers, 1.5 percent 

for front-loading standard clothes 

washers, 1.5 percent in 2015 and 13 

percent in 2018 for top-loading compact 

clothes washers. No consumers 

experience a LCC cost for front-loading 

compact clothes washers. The much 

lower first cost of washers meeting TSL 

3, combined with the fact that the vast 

majority of consumers experience either 

net LCC benefits or no impacts at TSL 

3, mitigates DOE’s concern that some 

low-income consumers would be 

compelled to delay or forgo new 

purchases. 

At TSL 3, the projected change in 

INPV ranges from an increase of $96.4 

million to a decrease of $858.8 million. 

For most manufacturers, the efficiency 

levels for top-loading clothes washers at 

TSL 3 correspond to incremental 

product conversion by 2015 and a 

platform redesign by 2018. These 

compliance dates mitigate capacity risk 

to manufacturers and their supply 

chains and afford manufacturers the 

flexibility to spread capital 

requirements, engineering resources, 

and other conversion activities over a 

longer period of time depending on the 

individual needs of each manufacturer. 

These factors at TSL3 mitigate DOE’s 

concerns about manufacturers’ ability to 

match production capacity to market 

demand. At TSL 3, DOE recognizes the 

risk of negative impacts if 

manufacturers’ expectations concerning 

reduced profit margins are realized. 

However, the additional flexibility of 

the compliance dates and range of 

efficiency levels above TSL 3 afford 

manufacturers room to maintain higher 

value products. Therefore, DOE expects 

impacts to be closer to the low end of 

the range of impacts. 

The Secretary concludes that at TSL 

3 for residential clothes washers, the 

benefits of energy savings, water 

savings, positive NPV of consumer 

benefits, generating capacity reductions, 

emission reductions, the estimated 

monetary value of the CO2 emissions 

reductions, and favorable consumer LCC 

savings and payback period for more 

than 97 percent of consumers outweigh 

the LCC costs for less than 3 percent of 

consumers and the conversion costs and 

profit margin impacts that could result 

in a reduction in INPV for 

manufacturers. 

In addition, the efficiency levels in 

TSL 3 correspond to the recommended 

levels in the Joint Petition, which DOE 

believes sets forth a statement by 

interested persons that are fairly 

representative of relevant points of view 


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32374 Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 

50 DOE used a two-step calculation process to 

convert the time-series of costs and benefits into 

annualized values. First, DOE calculated a present 

value in 2011, the year used for discounting the 

NPV of total consumer costs and savings, for the 

time-series of costs and benefits using discount 

rates of 3 and 7 percent for all costs and benefits 

except for the value of CO2 reductions. For the 

latter, DOE used a range of discount rates, as shown 

in Table V–29. From the present value, DOE then 

calculated the fixed annual payment over a 30-year 

period that yields the same present value. The fixed 

annual payment is the annualized value. Although 

DOE calculated annualized values, this does not 

imply that the time-series of cost and benefits from 

which the annualized values were determined is a 

steady stream of payments. 

(including representatives of 

manufacturers of covered products, 

States, and efficiency advocates) and 

contains recommendations with respect 

to an energy conservation standard that 

are in accordance with 42 U.S.C. 

6295(o). Moreover, DOE has encouraged 

the submission of consensus agreements 

as a way for diverse interested parties to 

develop an independent and probative 

analysis useful in DOE standard setting 

and to expedite the rulemaking process. 

DOE also believes that the standard 

levels recommended in the consensus 

agreement may increase the likelihood 

for regulatory compliance, while 

decreasing the risk of litigation. 

After considering the analysis, 

comments on the framework document, 

and the benefits and burdens of TSL 3, 

the Secretary concludes that this TSL 

will offer the maximum improvement in 

efficiency that is technologically 

feasible and economically justified, and 

will result in the significant 

conservation of energy. Therefore, DOE 

adopts TSL 3 for residential clothes 

washers. The amended energy 

conservation standards for residential 

clothes washers, which are a minimum 

allowable integrated modified energy 

factor (IMEF) and maximum allowable 

integrated water factor (IWF), are shown 

in Table V–28. 

TABLE V–28—AMENDED ENERGY CONSERVATION STANDARDS FOR RESIDENTIAL CLOTHES WASHERS

Product class 

Effective 

March 7, 2015 

Effective 

January 1, 2018 

Minimum IMEF* Maximum IWF† Minimum IMEF* Maximum IWF† 

1. Top-loading, Compact (less than 1.6 ft3 capacity) ...................... 0.86 14.4 1.15 12.0 

2. Top-loading, Standard ................................................................. 1.29 8.4 1.57 6.5 

3. Front-loading, Compact (less than 1.6 ft3 capacity) .................... 1.13 8.3 N/A 

4. Front-loading, Standard ............................................................... 1.84 4.7 N/A 

* IMEF (integrated modified energy factor) is calculated as the clothes container capacity in cubic feet divided by the sum, expressed in kilowatt-hours (kWh), of: (1) The total weighted per-cycle hot water energy consumption; (2) the total weighted per-cycle machine electrical energy 

consumption; (3) the per-cycle energy consumption for removing moisture from a test load; and (4) the per-cycle standby and off mode energy 

consumption. 

† IWF (integrated water consumption factor) is calculated as the sum, expressed in gallons per cycle, of the total weighted per-cycle water consumption for all wash cycles divided by the clothes container capacity in cubic feet. 

2. Summary of Benefits and Costs 

(Annualized) of the Standards 

The benefits and costs of today’s 

standards can also be expressed in terms 

of annualized values. The annualized 

monetary values are the sum of (1) the 

annualized national economic value, 

expressed in 2010$, of the benefits from 

operating products that meet the 

proposed standards (consisting 

primarily of operating cost savings from 

using less energy and water, minus 

increases in product purchase costs, 

which is another way of representing 

consumer NPV), and (2) the monetary 

value of the benefits of emission 

reductions, including CO2 emission 

reductions.50 The value of the CO2

reductions, otherwise known as the 

Social Cost of Carbon (SCC), is 

calculated using a range of values per 

metric ton of CO2 developed by a recent 

interagency process. 

Although combining the values of 

operating savings and CO2 reductions 

provides a useful perspective, two 

issues should be considered. First, the 

national operating savings are domestic 

U.S. consumer monetary savings that 

occur as a result of market transactions, 

while the value of CO2 reductions is 

based on a global value. Second, the 

assessments of operating cost savings 

and SCC are performed with different 

methods that use quite different time 

frames for analysis. The national 

operating cost savings is measured for 

the lifetime of products shipped in 

2015–2044. The SCC values, on the 

other hand, reflect the present value of 

all future climate-related impacts 

resulting from the emission of one ton 

of carbon dioxide in each year. These 

impacts continue well beyond 2100. 

Table V–29 shows the annualized 

values for clothes washers. Using a 7- 

percent discount rate for benefits and 

costs other than CO2 reductions, for 

which DOE used a 3-percent discount 

rate along with the SCC series 

corresponding to a value of $22.3/ton in 

2010, the cost of the standards for 

clothes washers in today’s rule is $185 

million per year in increased equipment 

costs, while the annualized benefits are 

$1,234 million per year in reduced 

equipment operating costs, $141.7 

million in CO2 reductions, and $5.4 

million in reduced NOX emissions. In 

this case, the net benefit amounts to 

$1.20 billion per year. Using a 3-percent 

discount rate for all benefits and costs 

and the SCC series corresponding to a 

value of $22.3/ton in 2010, the cost of 

the standards for clothes washers in 

today’s rule is $212 million per year in 

increased equipment costs, while the 

benefits are $1,808 million per year in 

reduced operating costs, $141.7 million 

in CO2 reductions, and $8.0 million in 

reduced NOX emissions. In this case, the 

net benefit amounts to $1.75 billion per 

year. 


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TABLE V–29—ANNUALIZED BENEFITS AND COSTS OF AMENDED STANDARDS (TSL 3) FOR CLOTHES WASHERS SOLD IN

2015–2044 

Discount rate 

Monetized (million 2010$/year) 

Primary estimate* Low net benefits 

estimate* 

High net benefits 

estimate* 

Benefits 

Operating Cost Savings ................. 7% .................................. 1234 ............................... 1101 ............................... 1379. 

3% .................................. 1808 ............................... 1587 ............................... 2042. 

CO2 Reduction at $4.9/t** .............. 5% .................................. 34.5 ................................ 31.7 ................................ 37.4. 

CO2 Reduction at $22.3/t** ............ 3% .................................. 142 ................................. 130 ................................. 154. 

CO2 Reduction at $36.5/t** ............ 2.5% ............................... 226 ................................. 207 ................................. 246. 

CO2 Reduction at $67.6/t** ............ 3% .................................. 431 ................................. 396 ................................. 469. 

NOX Reduction at $2,537/t** ......... 7% .................................. 5.40 ................................ 5.03 ................................ 5.82. 

3% .................................. 8.01 ................................ 7.39 ................................ 8.68. 

Total † ............................................. 7% plus CO2 range ........ 1274 to 1671 .................. 1137 to 1502 .................. 1423 to 1854. 

7% .................................. 1381 ............................... 1236 ............................... 1539. 

3% plus CO2 range ........ 1851 to 2248 .................. 1626 to 1991 .................. 2089 to 2520. 

3% .................................. 1958 ............................... 1725 ............................... 2205. 

Costs 

Incremental Product Costs ............ 7% .................................. 185 ................................. 258 ................................. 200. 

3% .................................. 212 ................................. 309 ................................. 230. 

Total Net Benefits 

Total † ............................................. 7% plus CO2 range ........ 1088 to 1485 .................. 880 to 1244 .................... 1223 to 1654. 

7% .................................. 1196 ............................... 978 ................................. 1339. 

3% plus CO2 range ........ 1639 to 2036 .................. 1317 to 1682 .................. 1859 to 2291. 

3% .................................. 1746 ............................... 1416 ............................... 1976. 

* The Primary, Low Benefit, and High Benefit Estimates utilize forecasts of energy prices and housing starts from the AEO2010 Reference 

case, Low Economic Growth case, and High Economic Growth case, respectively. In addition, incremental product costs reflect a declining trend 

using the default price trend for product prices in the Primary Estimate, constant product prices in the Low Benefits Estimate, and a high estimate of the declining price trend in the High Benefits Estimate. 

** The CO2 values represent global values (in 2010$) of the social cost of CO2 emissions in 2010 under several scenarios. The values of $4.9, 

$22.3, and $36.5 per ton are the averages of SCC distributions calculated using 5%, 3%, and 2.5% discount rates, respectively. The value of 

$67.6 per ton represents the 95th percentile of the SCC distribution calculated using a 3% discount rate. The value for NOX (in 2010$) is the average of the low and high values used in DOE’s analysis. 

† Total Benefits for both the 3% and 7% cases are derived using the SCC value calculated at a 3% discount rate, which is $22.3/ton in 2010 

(in 2010$). In the rows labeled as ‘‘7% plus CO2 range’’ and ‘‘3% plus CO2 range,’’ the operating cost and NOX benefits are calculated using the 

labeled discount rate, and those values are added to the full range of CO2 values. 

VI. Procedural Issues and Regulatory 

Review 

A. Review Under Executive Order 12866 

and Executive Order 13563 

Section 1(b)(1) of Executive Order 

12866, ‘‘Regulatory Planning and 

Review,’’ 58 FR 51735 (Oct. 4, 1993), 

requires each agency to identify the 

problem that it intends to address, 

including, where applicable, the failures 

of private markets or public institutions 

that warrant new agency action, as well 

as to assess the significance of that 

problem. The problems that today’s 

standards address are as follows: 

(1) There is a lack of consumer 

information and/or information 

processing capability about energy 

efficiency opportunities in the home 

appliance market. 

(2) There is asymmetric information 

(one party to a transaction has more and 

better information than the other) and/ 

or high transactions costs (costs of 

gathering information and effecting 

exchanges of goods and services). 

(3) There are external benefits 

resulting from improved energy 

efficiency of residential clothes washers 

that are not captured by the users of 

such equipment. These benefits include 

externalities related to environmental 

protection and energy security that are 

not reflected in energy prices, such as 

reduced emissions of greenhouse gases. 

In addition, DOE has determined that 

today’s regulatory action is an 

‘‘economically significant regulatory 

action’’ under section 3(f)(1) of 

Executive Order 12866. Accordingly, 

section 6(a)(3) of the Executive Order 

requires that DOE prepare a regulatory 

impact analysis (RIA) on today’s rule 

and that the Office of Information and 

Regulatory Affairs (OIRA) in the Office 

of Management and Budget (OMB) 

review this rule. DOE presented to OIRA 

for review the draft rule and other 

documents prepared for this 

rulemaking, including the RIA, and 

included these documents in the 

rulemaking record. The assessments 

prepared pursuant to Executive Order 

12866 can be found in the technical 

support document for this rulemaking at 

http://www1.eere.energy.gov/buildings/ 

appliance_standards/residential/ 

clothes_washers.html. They are 

available for public review in the 

Resource Room of DOE’s Building 

Technologies Program, 950 L’Enfant 

Plaza SW., Suite 600, Washington, DC 

20024, (202) 586–2945, between 9:00 

a.m. and 4:00 p.m., Monday through 

Friday, except Federal holidays. 

DOE has also reviewed this regulation 

pursuant to Executive Order 13563, 

issued on January 18, 2011 (76 FR 3281, 

Jan. 21, 2011). EO 13563 is 

supplemental to and explicitly reaffirms 

the principles, structures, and 

definitions governing regulatory review 

established in Executive Order 12866. 

To the extent permitted by law, agencies 

are required by Executive Order 13563 

to: (1) Propose or adopt a regulation 

only upon a reasoned determination 

that its benefits justify its costs 


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(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. 

We emphasize as well that Executive 

Order 13563 requires agencies ‘‘to use 

the best available techniques to quantify 

anticipated present and future benefits 

and costs as accurately as possible.’’ In 

its guidance, the Office of Information 

and Regulatory Affairs has emphasized 

that such techniques may include 

‘‘identifying changing future 

compliance costs that might result from 

technological innovation or anticipated 

behavioral changes.’’ For the reasons 

stated in the preamble, DOE believes 

that today’s direct final rule is 

consistent with these principles, 

including that, to the extent permitted 

by law, agencies adopt a regulation only 

upon a reasoned determination that its 

benefits justify its costs and select, in 

choosing among alternative regulatory 

approaches, those approaches that 

maximize net benefits. 

B. Review Under the Regulatory 

Flexibility Act 

The Regulatory Flexibility Act (RFA, 

5 U.S.C. 601 et seq.) requires 

preparation of an initial regulatory 

flexibility analysis (IRFA) for any rule 

that by law must be proposed for public 

comment, unless the agency certifies 

that the rule, if promulgated, will not 

have a significant economic impact on 

a substantial number of small entities. 

As required by Executive Order 13272, 

‘‘Proper Consideration of Small Entities 

in Agency Rulemaking,’’ 67 FR 53461 

(August 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 Web site (www.gc.doe.gov). 

DOE reviewed today’s direct final rule 

and corresponding NOPR pursuant to 

the RFA and the policies and 

procedures discussed above. Set forth 

below is DOE’s initial regulatory 

flexibility analysis for the standards 

proposed in the NOPR, published 

elsewhere in today’s Federal Register. 

DOE will consider any comments on the 

analysis or economic impacts of the rule 

in determining whether to proceed with 

the direct final rule. DOE will publish 

its final regulatory flexibility analysis 

(FRFA), including responses to any 

comments received, in a separate notice 

at the conclusion of the 110-day 

comment period. 

1. Description of Why DOE Is 

Considering the Standards in Today’s 

Direct Final Rule 

The reasons why DOE is establishing 

the standards in today’s direct final rule 

and the objectives of these standards are 

provided elsewhere in the preamble and 

not repeated here. 

2. Statement of the Objectives of, and 

Legal Basis for, the Standards 

A statement of the objectives of, and 

legal basis for, the standards in today’s 

direct final rule is provided elsewhere 

in the preamble and not repeated here. 

3. Description and Estimated Number of 

Small Entities Regulated 

For manufacturers of residential 

clothes washers, 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. 65 FR 30836, 30848 (May 15, 

2000), as amended at 65 FR 53533, 

53544 (Sept. 5, 2000) and codified at 13 

CFR part 121.The size standards are 

listed by North American Industry 

Classification System (NAICS) code and 

industry description and are available at 

www.sba.gov/idc/groups/public/ 

documents/sba_homepage/ 

serv_sstd_tablepdf.pdf. Residential 

clothes washer manufacturing is 

classified under NAICS Code 335224, 

‘‘Household Laundry Equipment 

Manufacturing.’’ The SBA sets a 

threshold of 1,000 employees or less for 

an entity to be considered as a small 

business for this category. 

To estimate the number of small 

businesses who could be impacted by 

the amended energy conservation 

standards, DOE conducted a market 

survey using all available public 

information to identify potential small 

manufacturers. DOE’s research included 

the AHAM membership directory, 

product databases (CEE, CEC, and 

ENERGY STAR databases) and 

individual company Web sites to find 

potential small business manufacturers. 

DOE also asked interested parties and 

industry representatives if they were 

aware of any other small business 

manufacturers during manufacturer 

interviews and at previous DOE public 

meetings. DOE reviewed all publicly 

available data and contacted various 

companies, as necessary, to determine 

whether they met the SBA’s definition 

of a small business manufacturer of 

covered residential clothes washers. 

DOE screened out companies that did 

not offer products covered by this 

rulemaking, did not meet the definition 

of a ‘‘small business,’’ or are foreign 

owned and operated. 

The majority of residential clothes 

washers are currently manufactured in 

the United States by one corporation 

that accounts for approximately 64 

percent of the total market. Together, 

this manufacturer and three other 

manufacturers that do not meet the 

definition of a small business 

manufacturer comprise 92 percent of the 

residential clothes washer market. The 

small portion of the remaining 

residential clothes washer market 

(approximately 700,000 shipments) is 

supplied by a combination of 12 

international and domestic companies, 

all of which have small market shares. 

Of the remaining 12 companies that 

manufacturer residential clothes 

washers for sale in the United States, 

DOE identified only one manufacturer 

that is considered a small business 

under NAICS Code 335224. 

4. Description and Estimate of 

Compliance Requirements 

The one small business manufacturer 

of residential clothes washers covered 

by this rulemaking has one product 

platform. It makes a top-loading 

standard residential clothes washer that 

currently meets a 1.85 MEF and a 6.75 

WF. The product meets the 2015 energy 

conservation standards proposed in this 

direct final rule, but falls short of the 

2018 standard. The unit does not offer 

warm rinse and has electromechanical 

controls, making it likely that three 

wash temperatures (hot, warm, cold) are 

available on all settings including 

Normal for test procedure purposes. 

Thus, it is likely the unit will have to 

undergo alterations to its basic design to 

meet the 2018 efficiency requirements. 

This company appears to manufacture 

its residential clothes washer with less 


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automation and more labor than some of 

the larger competitors. To change the 

design of their current product to meet 

the 2018 efficiency standards, one 

available design pathway would be 

increasing the volume of the wash 

basket, assuming there is enough 

clearance within the cabinet. Increasing 

the drum’s radius would involve cutting 

slightly larger octagonal pieces of metal 

and would not be a capital intensive 

solution. With this pathway, the 

assembly process and fabrication time 

would essentially remain the same. This 

solution would also prevent the small 

business manufacturer from bearing the 

cost of retrofitting their manufacturing 

process and could result in lower perunit conversion costs relative to larger 

manufacturers. 

Based on the engineering analysis and 

manufacturer interviews, if two fulltime engineers took one year to 

implement a larger drum radius within 

the existing cabinet it could cost the 

manufacturer roughly $200,000 to 

implement the design change for the 

2018 compliance date. If the 

manufacturer were to incur additional 

tooling costs to implement this change, 

this could lead to an additional 

$200,000 in capital conversion costs. 

Because the small business 

manufacturer already meets the 2015 

energy conservation standards, it would 

have 7 years from the announcement of 

today’s direct final rule until it would 

have to make any changes to its current 

product in response to standards. 

5. Duplication, Overlap, and Conflict 

With Other Rules 

DOE is not aware of any rules or 

regulations that duplicate, overlap, or 

conflict with the rule being promulgated 

today. 

6. Significant Alternatives to the Rule 

The discussion above analyzes 

impacts on small businesses that would 

result from DOE’s rule. In addition to 

the other TSLs being considered, the 

direct final rule TSD includes a 

regulatory impact analysis (RIA). For 

residential clothes washers, the RIA 

discusses the following policy 

alternatives: (1) No new regulatory 

action; (2) consumer rebates; (3) 

consumer tax credits; (4) manufacturer 

tax credits; (5) voluntary energy 

efficiency targets; (6) early replacement; 

and (7) bulk government purchases. 

While these alternatives may mitigate to 

some varying extent the economic 

impacts on small entities compared to 

the amended standards, DOE 

determined that the energy savings of 

these regulatory alternatives are at least 

3.8 times smaller than those that would 

be expected to result from adoption of 

the amended standard levels. Thus, 

DOE rejected these alternatives and is 

adopting the amended standards set 

forth in this rulemaking. (See chapter 17 

of direct final rule TSD for further detail 

on the policy alternatives DOE 

considered.) 

C. Review Under the Paperwork 

Reduction Act 

Manufacturers of residential clothes 

washers must certify to DOE that their 

products comply with any applicable 

energy conservation standard. In 

certifying compliance, manufacturers 

must test their products according to the 

DOE test procedures for residential 

clothes washers, 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 

residential clothes washers. 76 FR 

12422 (March 7, 2011). The collectionof-information requirement for the 

certification and recordkeeping is 

subject to review and approval by OMB 

under the Paperwork Reduction Act 

(PRA). This requirement has been 

approved by OMB under OMB control 

number 1910–1400. Public reporting 

burden for the certification is estimated 

to average 20 hours per response, 

including the time for reviewing 

instructions, searching existing data 

sources, gathering and maintaining the 

data needed, and completing and 

reviewing the collection of information. 

Notwithstanding any other provision 

of the law, no person is required to 

respond to, nor shall any person be 

subject to a penalty for failure to comply 

with, a collection of information subject 

to the requirements of the PRA, unless 

that collection of information displays a 

currently valid OMB Control Number. 

D. Review Under the National 

Environmental Policy Act of 1969 

Pursuant to the National 

Environmental Policy Act (NEPA) of 

1969, DOE has determined that today’s 

rule fits within the category of actions 

included in Categorical Exclusion (CX) 

B5.1 and otherwise meets the 

requirements for application of a CX. 

See 10 CFR Part 1021, App. B, B5.1(b); 

1021.410(b) and Appendix B, B(1)–(5). 

The rule fits within the category of 

actions because it is a rulemaking that 

establishes energy conservation 

standards for consumer products or 

industrial equipment, and for which 

none of the exceptions identified in CX 

B5.1(b) apply. Therefore, DOE has made 

a CX determination for this rulemaking, 

and DOE does not need to prepare an 

Environmental Assessment or 

Environmental Impact Statement for 

this rule. DOE’s CX determination for 

this direct final rule is available at 

http://cxnepa.energy.gov. 

E. Review Under Executive Order 13132 

Executive Order 13132, ‘‘Federalism.’’ 

64 FR 43255 (Aug. 10, 1999) imposes 

certain requirements on Federal 

agencies formulating and implementing 

policies or regulations that preempt 

State law or that have Federalism 

implications. The Executive Order 

requires agencies to examine the 

constitutional and statutory authority 

supporting any action that would limit 

the policymaking discretion of the 

States and to carefully assess the 

necessity for such actions. The 

Executive Order also requires agencies 

to have an accountable process to 

ensure meaningful and timely input by 

State and local officials in the 

development of regulatory policies that 

have Federalism implications. On 

March 14, 2000, DOE published a 

statement of policy describing the 

intergovernmental consultation process 

it will follow in the development of 

such regulations. 65 FR 13735. EPCA 

governs and prescribes Federal 

preemption of State regulations as to 

energy conservation for the products 

that are the subject of today’s direct 

final rule. States can petition DOE for 

exemption from such preemption to the 

extent, and based on criteria, set forth in 

EPCA. (42 U.S.C. 6297) No further 

action is required by Executive Order 

13132. 

F. Review Under Executive Order 12988 

With respect to the review of existing 

regulations and the promulgation of 

new regulations, section 3(a) of 

Executive Order 12988, ‘‘Civil Justice 

Reform,’’ imposes on Federal agencies 

the general duty to adhere to the 

following requirements: (1) Eliminate 

drafting errors and ambiguity; (2) write 

regulations to minimize litigation; and 

(3) provide a clear legal standard for 

affected conduct rather than a general 

standard and promote simplification 

and burden reduction. 61 FR 4729 (Feb. 

7, 1996). Section 3(b) of Executive Order 

12988 specifically requires that 

Executive agencies make every 

reasonable effort to ensure that the 

regulation: (1) Clearly specifies the 

preemptive effect, if any; (2) clearly 

specifies any effect on existing Federal 

law or regulation; (3) provides a clear 

legal standard for affected conduct 

while promoting simplification and 

burden reduction; (4) specifies the 

retroactive effect, if any; (5) adequately 


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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 direct 

final rule meets the relevant standards 

of Executive Order 12988. 

G. Review Under the Unfunded 

Mandates Reform Act of 1995 

Title II of the Unfunded Mandates 

Reform Act of 1995 (UMRA) requires 

each Federal agency to assess the effects 

of Federal regulatory actions on State, 

local, and Tribal governments and the 

private sector. Public Law 104–4, sec. 

201 (codified at 2 U.S.C. 1531). For an 

amended 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 ‘‘significant 

intergovernmental mandate,’’ and 

requires an agency plan for giving notice 

and opportunity for timely input to 

potentially affected small governments 

before establishing any requirements 

that might significantly or uniquely 

affect small governments. On March 18, 

1997, DOE published a statement of 

policy on its process for 

intergovernmental consultation under 

UMRA. 62 FR 12820. DOE’s policy 

statement is also available at http:// 

www.gc.doe.gov/. 

DOE has concluded that this direct 

final rule would likely result in a final 

rule that could impose expenditures of 

$100 million or more on the private 

sector. Such expenditures may include: 

(1) Investment in research and 

development and in capital 

expenditures by residential clothes 

washer 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 residential clothes 

washers. 

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 final 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 

the notice of final rulemaking and the 

‘‘Regulatory Impact Analysis’’ section of 

the TSD for this direct final 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 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(d), (f), and (o), 6313(e), and 

6316(a), today’s final rule would 

establish energy conservation standards 

for residential clothes washers that are 

designed to achieve the maximum 

improvement in energy efficiency that 

DOE has determined to be both 

technologically feasible and 

economically justified. A full discussion 

of the alternatives considered by DOE is 

presented in the ‘‘Regulatory Impact 

Analysis’’ section of the TSD for today’s 

direct final rule. 

H. Review Under the Treasury and 

General Government Appropriations 

Act, 1999 

Section 654 of the Treasury and 

General Government Appropriations 

Act, 1999 (Pub. L. 105–277) requires 

Federal agencies to issue a Family 

Policymaking Assessment for any rule 

that may affect family well-being. This 

rule would not have any impact on the 

autonomy or integrity of the family as 

an institution. Accordingly, DOE has 

concluded that it is not necessary to 

prepare a Family Policymaking 

Assessment. 

I. Review Under Executive Order 12630 

DOE has determined, under Executive 

Order 12630, ‘‘Governmental Actions 

and Interference with Constitutionally 

Protected Property Rights’’ 53 FR 8859 

(March 18, 1988), that this regulation 

would not result in any takings that 

might require compensation under the 

Fifth Amendment to the U.S. 

Constitution. 

J. Review Under the Treasury and 

General Government Appropriations 

Act, 2001 

Section 515 of the Treasury and 

General Government Appropriations 

Act, 2001 (44 U.S.C. 3516, note) 

provides for Federal agencies to review 

most disseminations of information to 

the public under guidelines established 

by each agency pursuant to general 

guidelines issued by OMB. OMB’s 

guidelines were published at 67 FR 

8452 (Feb. 22, 2002), and DOE’s 

guidelines were published at 67 FR 

62446 (Oct. 7, 2002). DOE has reviewed 

today’s direct final rule under the OMB 

and DOE guidelines and has concluded 

that it is consistent with applicable 

policies in those guidelines. 

K. Review Under Executive Order 13211 

Executive Order 13211, ‘‘Actions 

Concerning Regulations That 

Significantly Affect Energy Supply, 

Distribution, or Use’’ 66 FR 28355 (May 

22, 2001), requires Federal agencies to 

prepare and submit to OIRA at OMB, a 

Statement of Energy Effects for any 

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 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 concluded that today’s 

regulatory action, which sets forth 

energy conservation standards for 

residential clothes washers, is not a 

significant energy action because the 

amended standards are not likely to 

have a significant adverse effect on the 

supply, distribution, or use of energy, 

nor has it been designated as such by 

the Administrator at OIRA. Accordingly, 

DOE has not prepared a Statement of 

Energy Effects on the direct final rule. 

L. Review Under the Information 

Quality Bulletin for Peer Review 

On December 16, 2004, OMB, in 

consultation with the Office of Science 

and Technology Policy (OSTP), issued 

its Final Information Quality Bulletin 


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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 2667. 

In response to OMB’s Bulletin, DOE 

conducted formal in-progress peer 

reviews of the energy conservation 

standards development process and 

analyses and has prepared a Peer 

Review Report pertaining to the energy 

conservation standards rulemaking 

analyses. Generation of this report 

involved a rigorous, formal, and 

documented evaluation using objective 

criteria and qualified and independent 

reviewers to make a judgment as to the 

technical/scientific/business merit, the 

actual or anticipated results, and the 

productivity and management 

effectiveness of programs and/or 

projects. The ‘‘Energy Conservation 

Standards Rulemaking Peer Review 

Report’’ dated February 2007 has been 

disseminated and is available at the 

following Web site: www1.eere.energy.

gov/buildings/appliance_standards/

peer_review.html. 

M. Congressional Notification 

As required by 5 U.S.C. 801, DOE will 

report to Congress on the promulgation 

of this rule prior to its effective date. 

The report will state that it has been 

determined that the rule is a ‘‘major 

rule’’ as defined by 5 U.S.C. 804(2). 

VII. Approval of the Office of the 

Secretary 

The Secretary of Energy has approved 

publication of today’s direct final rule. 

List of Subjects 

10 CFR Part 429 

Administrative practice and 

procedure, Confidential business 

information, Energy conservation, 

Household appliances, and Reporting 

and recordkeeping requirements. 

10 CFR Part 430 

Administrative practice and 

procedure, Confidential business 

information, Energy conservation, 

Household appliances, Imports, 

Intergovernmental relations, and Small 

businesses. 

Issued in Washington, DC, on May 11, 

2012. 

Dr. David Danielson, 

Assistant Secretary, Energy Efficiency and 

Renewable Energy. 

For the reasons set forth in the 

preamble, DOE amends parts 429 and 

430 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. 

■ 2. In § 429.20 revise paragraph (b)(2) 

to read as follows: 

§ 429.20 Residential clothes washers. 

* * * * * 

(b) * * * 

(2) Pursuant to § 429.12(b)(13), a 

certification report shall include the 

following public product-specific 

information: 

(i) For residential clothes washers 

manufactured before March 7, 2015: The 

modified energy factor (MEF) in cubic 

feet per kilowatt hour per cycle (cu ft/ 

kWh/cycle) and the capacity in cubic 

feet (cu ft). For standard-size residential 

clothes washers, a water factor (WF) in 

gallons per cycle per cubic feet (gal/ 

cycle/cu ft). 

(ii) For residential clothes washers 

manufactured on or after March 7, 2015: 

The integrated modified energy factor 

(IMEF) in cu ft/kWh/cycle, the 

integrated water factor (IWF) in gal/ 

cycle/cu ft, the capacity in cu ft and the 

type of loading (top-loading or frontloading). 

* * * * * 

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. In § 430.32 revise paragraph (g) to 

read as follows: 

§ 430.32 Energy and water conservation 

standards and their effective dates. 

* * * * * 

(g) Clothes washers. (1) Clothes 

washers manufactured on or after 

January 1, 2007 shall have a Modified 

Energy Factor no less than: 

Product class Modified energy factor 

(cu.ft./kWh/cycle) 

i. Top-loading, Compact (less than 1.6 ft3 capacity) ............................................................................................................... 0.65. 

ii. Top-loading, Standard (1.6 ft3 or greater capacity) ............................................................................................................. 1.26. 

iii. Top-Loading, Semi-Automatic ............................................................................................................................................. Not Applicable.1

iv. Front-loading ....................................................................................................................................................................... 1.26. 

v. Suds-saving ......................................................................................................................................................................... Not Applicable.1

1 Must have an unheated rinse water option. 

(2) All top-loading or front-loading 

standard-size residential clothes 

washers manufactured on or after 

January 1, 2011, and before March 7, 

2015, shall meet the following 

standard— 

(i) A Modified Energy Factor of at 

least 1.26; and 

(ii) A Water Factor of not more than 

9.5. 

(3) Clothes washers manufactured on 

or after March 7, 2015, and before 

January 1, 2018, shall have an Integrated 

Modified Energy Factor no less than, 

and an Integrated Water Factor no 

greater than: 


srobinson on DSK4SPTVN1PROD with RULES3
32380 Federal Register / Vol. 77, No. 105 / Thursday, May 31, 2012 / Rules and Regulations 

Product class 

Integrated modified 

energy factor 

(cu.ft./kWh/cycle) 

Integrated water 

factor 

(gal/cycle/cu.ft.) 

i. Top-loading, Compact (less than 1.6 ft3 capacity) ....................................................................... 0.86 14.4 

ii. Top-loading, Standard (1.6 ft3 or greater capacity) ..................................................................... 1.29 8.4 

iii. Front-loading, Compact (less than 1.6 ft3 capacity) ................................................................... 1.13 8.3 

iv. Front-loading, Standard (1.6 ft3 or greater capacity) ................................................................. 1.84 4.7 

(4) Clothes washers manufactured on 

or after January 1, 2018 shall have an 

Integrated Modified Energy Factor no 

less than, and an Integrated Water 

Factor no greater than: 

Product class 

Integrated modified 

energy factor 

(cu.ft./kWh/cycle) 

Integrated water 

factor 

(gal/cycle/cu.ft.) 

i. Top-loading, Compact (less than 1.6 ft3 capacity) ....................................................................... 1.15 12.0 

ii. Top-loading, Standard (1.6 ft3 or greater capacity) ..................................................................... 1.57 6.5 

iii. Front-loading, Compact (less than 1.6 ft3 capacity) ................................................................... 1.13 8.3 

iv. Front-loading, Standard (1.6 ft3 or greater capacity) ................................................................. 1.84 4.7 

* * * * * 

[FR Doc. 2012–12320 Filed 5–30–12; 8:45 am] 

BILLING CODE 6450–01–P 


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