10 -i CHAPTER 10. SHIPMENTS ANALYSIS TABLE OF CONTENTS

10.1 INTRODUCTION ............................................................................................................ 10-2 10.2 SHIPMENTS MODEL METH ODOLOGY ..................................................................... 10-2 10.2.1 Analyzed Product Classes, Market Sectors, and Market Segments ................... 10-3

10.2.1.1 Ballast Failure ............................................................................................ 10-3 10.2.1.2 New Construction/Renovation ................................................................... 10-4 10.3 BASE

- CASE INPUTS AND FORECASTS .................................................................... 10-6 10.3.1 Base

- Case Scenarios Analyzed .......................................................................... 10-6 10.3.2 Historical Shipments .......................................................................................... 10-7 10.3.3 Calculation of Installed Stock ............................................................................ 10-9 10.3.4 Base

- Case Market

- Share Apportionment .......................................................... 10-9 10.3.5 Base

- Case Forecast Results ............................................................................. 10-10 10.3.6 Base

- Case Forecast by Market Segment .......................................................... 10-13 10.4 STANDARDS

- CASE INPUTS ...................................................................................... 10-15 10.5 RESULTS ....................................................................................................................... 10-16 REFERENCES ........................................................................................................................ 10-22

LIST OF TABLES

Table 10.2.1 Product Classes and Market Sectors Analyzed in the Shipments Analysis .......... 10-3 Table 10.2.2 Modeled Fluorescent Lamp- and

- Ballast Replacement Trends ............................. 10-4 Table 10.3.1 Estimated NEMA and Non- NEMA Shipment Percentages for Fluorescent Lamp Ballasts

................................ ................................ ..................................... 10-8 Table 10.3.2 Total Historical Fluorescent Lamp Ballast Shipments (Millions) ........................ 10-9 Table 10.3.3 Weighted Apportionments for Standard- and High- Efficiency 4 -Foot T8 MBP Ballasts ................................................................................................... 10-10

LIST OF FIGURES Figure 10.3.1 Base- Case Forecasted Ballast Shipments (Existing Technologies Scenarios) .. 10-11 Figure 10.3.2 Base- Case Forecasted Ballast Shipments (Emerging Technologies Scenarios) ......................................................................................................... 10-12 Figure 10.3.3 Product Class 1— IS and RS Ballasts That Operate 4 -Foot MBP and 8-Foot Slimline Lamps: Ballast Shipments Forecast by Market Segment (Existing Technologies Scenario) .................................................................................... 10-13 Figure 10.3.4 Product Class 2— PS Ballasts That Operate 4 -Foot MBP, MiniBP SO and MiniBP HO Lamps: Ballast Shipments Forecast by Market Segment (Existing Technologies Scenario) .................................................................... 10-14 Figure 10.3.5 Product Class 3— IS and RS Ballasts That Operate 8

- Foot RDC HO Lamps: Ballast Shipments Forecast by Market Segment (Existing Technologies Scenario) .................................................................................... 10-1410

- ii Figure 10.3.6 Product Class 5— IS and RS Ballasts That Operate 8

- Foot RDC HO Lamps in Cold Temperature Outdoor Signs: Ballast Shipments Forecast by Market Segment (Existing Technologies Scenario) ........................................ 10-15 Figure 10.5.1 Produc t Class 1

— IS and RS Ballasts That Operate Two 4

- Foot MBP Lamps (Commercial): Base

- Case and Standards

- Case Ballast Shipments Forecasts (Existing Technologies, Shift Scenario) .......................................... 10-17 Figure 10.5.2 Product Class 1— IS and RS Ballasts That Operate Two 4

- Foot MBP Lamps (Residential): Base

- Case and Standards

- Case Ballast Shipments Forecasts (Existing Technologies, Shift Scenario) .......................................... 10-17 Figure 10.5.3 Product Class 1— IS and RS Ballasts That Operate Four 4

- Foot MBP Lamps: Base

- Case and Standards

- Case Ballast Shipments Foreca sts (Existing Technologies, Shift Scenario) .......................................................... 10-18 Figure 10.5.4 Product Class 1— IS and RS Ballasts That Operate Two 8

- Foot Slimline Lamps:Base

- Case and Standards

- Case Ballast Shipments Forecasts (Existing Technologies, Shift Scenario) .......................................................... 10-18 Figure 10.5.5 Product Class 2

— PS Ballasts That Operate Two 4 -Foot MBP Lamps: Base

- Case and Standards

- Case Ballast Shipments Forecasts (Existing Technologies, Shift Scenario) .......................................................................... 10-19 Figure 10.5.6 Product Class 2— PS Ballasts That Operate Four 4 -Foot MBP Lamps: Base

- Case and Standards

- Case Ballast Shipments Forecasts (Existing Technologies, Shift Scenario) .......................................................................... 10-19 Figure 10.5.7 Product Class 2— PS Ballasts That Operate Two 4 -Foot MiniBP SO Lamps: Base

- Case and Standards

- Case Ballast Shipments Forecasts (Existing Technologies, Shift Scenario) .......................................................... 10-20 Figure 10.5.8 Product Class 2— PS Ballasts That Operate Two 4 -Foot MiniBP HO Lamps: Base

- Case and Standards

- Case Ballast Shipme nts Forecasts (Existing Technologies, Shift Scenario) .......................................................... 10-20 Figure 10.5.9 Product Class 3— IS and RS Ballasts That Operate Two 8

- Foot RDC HO Lamps: Base

- Case and Standards

- Case Ballast Shipments Forecasts (Existing Technologies, Shift Scenario) .......................................................... 10-21 Figure 10.5.10 Product Class 5—IS And RS Ballasts That Operate Four 8- Foot RDC HO Lamps in Cold Temperature Outdoor Signs: Base- Case and Standards

Case Ballast Shipments Forecasts (Existing Technologies, Shift Scenario) ... 10-2110 -2 CHAPTER 10 . SHIPMENTS ANALYSIS

10.1 INTRODUCTION Shipments of fluorescent lamp ballast s ( hereafter “ballasts”) are key inputs to the national energy savings (NES) and net present value (NPV) calculations. Shipments are also a necessary input to the manufacturer impact analysis, which the U.S. Department of Energy (DOE) conducts for its n otices of proposed rulemaking (NOPRs). This chapter describes DOE’s methodology for projecting annual shipments and presents initial inputs and results for ballast s. In the shipments analysis, DOE develop ed a base

- case shipment forecast for each ballast type to depict what would happen to energy use and consumer costs for the purchase and operation of lamp- and

- ballast system s in the absence of amended Federal energy conservation standards. In determining the base case, DOE consider ed historical shipments, emerging technologies, the mix of efficiencies sold in the absence of amended standards, and how that mix might change over time. To evaluate the impacts of standards on ballast s, DOE then compared the base

- case project ion with forecasts of what could happen if DOE promulgates amended standards (the standards case ) . DOE consider ed multiple shipments scenarios to characterize both the base - and standards- case shipments. As an input to determine the cumulative NES and NPV of standards , DOE compare d forecasted shipments of a base to a standards case over the national impact analysis ( NIA ) analysis period, 2014–2043.
The shipments model and the n ational i mpacts model are integrated into a single Microsoft Excel spreadsheet accessible at www1.eere.energy.gov/buildings/appliance_standards/residential/fluorescent_lamp_ballasts.html

. Appendix 10 A discusse s how to acc ess the spreadsheet and provides basic instructions for its use. This NOPR technical support document ( TSD ) chapter explains the shipments models. Section 10.2 presents the shipments model methodology for ballast s ; section 10.3 describes the data inputs, historical shipments, base

- case scenarios , and shipments forecasts; section 10.4 discusses the impacts of proposed amended standards on the mix of ballast designs; and section 10.5 presents the shipments results for the different trial standard levels (TSL s).

10.2 SHIPMENTS MODEL METH ODOLOGY In general, DOE follow ed a three

- step process to forecast ballast shipments . First, DOE used 1990 to 2005 historical shipment data from U.S. Census Bureau to estimate historical shipments of each ballast type analyzed. Second, DOE calculate d an installed stock for each ballast type in 2005 bas ed on the lifetime distribution of each ballast type . Third, by modeling ballast purchasing events, such as replacement for failed ballasts and new construction, and applying growth rate, replacement rate, substitution among and within product classes and emerging technologies penetration rate assumptions, DOE developed annual shipment projections for the analysis period.10 -3 10.2.1 Analyzed Product Classes, Market Sectors, and Market Segments
DOE forecasted annual shipments for the ballast and ma rket sectors pre sented in Table 10.2.1 . The shipments model analyze d all ballast types at TSLs that assign efficiency levels for each product class

. Table 10.2.1 Product Classes and Market Sectors Analyzed in the Shipments Analysis Description Product Class Number IS and RS ballasts that operate 4- foot medium bipin (MBP) lamps* 8- foot slimline lamps 1 PS ballasts that operate 4- foot MBP lamps* 4- foot miniature bipin (MiniBP) standard output (SO) lamps 4

- foot MiniBP high output (HO) lamps 2

IS and RS ballasts that operate 8- foot recessed double

- contact (RDC) HO lamps 3 Ballasts that operate 8

- foot RDC HO lamps in cold temperature outdoor signs 5 *Includes both commercial and residential ballasts
In its shipments model , DOE consider ed specific market segments (“ ballast purchase events”) to develop estimates of annual shipments. These two market segments correspond to th e ballast purchase events that DOE used in the life

- cycle cost ( LCC ) and payback period ( PBP ) analys e s ( NOPR TSD c hapter 8) . These includ ed ballast failure (Event I) and new construction/renovation (Event II ). For each market segment, DOE ma de certain assumptions about how consumers are likely to purchase new ballasts or lamp

- and

- ballast systems. DOE used these purchasing assumptions to develop the b allast shipment forecasts.

10.2.1.1 Ballast Failure For those consumer purchases triggered by a ballast failure, DOE assume d that the consumer will purchase a ballast identical to the one that has retired, if it is available. If in the standards case , the base

- case ballast design is not standards-compliant (and therefore unavailabl e as a replacement option ), then DOE assume d consumers will purchase anew, standardscompliant lamp

- and

- ballast system from the same product class such that the system light output, if po ssible, never drops below 10 percent of the baseline system. In some instances this means a single ballast is replaced with two ballasts ( e.g. , replacing one two -lamp, 8- foot slimline lamp

and

- ballast system with two two -lamp, 4-foot MBP lamp

- and

- ballast systems)

. Table 10.2.2 presents a full listing of the modeled lamp

- and

- ballast system replacement trends.10 -4 Table 10.2.2 Modeled Fluorescent Lamp -and- Ballast Replacement Trends Retired Lamp

- and

- Ballast System Replacement Lamp

- and

- Ballast System 4

- f oot T12 e lectronic MBP (commercial sector) 87.5% 4

- f oot T8 MBP 12.5% 4

- f oot T5 MiniBP SO 4

- f oot T8 MBP (commercial sector) 87.5 % r eplace in kind 12.5% 4

- foo t T5 MiniBP SO 4

- f oot T12 e lectronic MBP (residential sector) 20% replace in kind 80 % 4

- foot T8 MBP 4

- f oot T8 MBP (residential sector) r eplace in kind 8

- f oot T12 s limline 10% 8

- f oot T8 s limline 10% r eplace in kind 80% two 4

- f oot T8 MBPs 8

- f oot T8 s limline r eplace in kind 4

- f oot T5 MiniBP SO r eplace in kind 4

- f oot T5 MiniBP HO r eplace in kind 8

- f oot T12 RDC HO 5% replace in kind 9 0% two 4

- f oot T5 MiniBP HO s ystems 5 % 8

- f oot T8 RDC HO 8

- f oot T8 RDC HO 9 0% two 4

- f oot T5 MiniBP HO s ystems 1 0% r eplace in kind 8

- f oot T12 m agnetic RDC HO ( c old t emp erature / s ign b allasts) r eplace in kind

DOE establishe d the timing of ballast replacements in response to ballast failure by tracking ballast shipments and then predicting when these ballasts are expected to retire based on their lifetime distribution

. DOE recognized that ballast lifetimes vary , and modeled ballasts lifetimes with Weibull distribution s with maximum lifetimes as follows:

• Commercial sector – 20 years

• Industrial sector – 15 years

• Residential sector – 30 years

A verage lifetimes were adjusted to match average service life in NOPR TSD chapter 8

. 10.2.1.2 New Construction /Renovation For consumer purchases triggered by new construction and renovation, DOE began by assuming that consumers may purchase new lamp- and

- ballast systems to service their particular lumen demand from within their current product class. DOE therefore produced ini tial shipment estimates due to new construction and renovation by deriving growth rates for each product class. The growth rates are based on the Energy Information Administration’s ( EIA’s ) Annual Energy Outlook 2010 ( AEO20 10 ), 1 which estimates annual commercial floor space and residential building growth. B ecause the AEO does not provide industrial floor space forecasts, DOE used commercial floor space growth values to establish a growth rate for the industrial sector

. DOE assumed that the intensity of bal lasts per unit of floor space remains constant ( i.e. , sector growth rates are assumed to be the only source of overall growth in the ballasts market ). For renovation/retrofit, DOE assumed that each year 1 percent of ballasts in residential sector (310 -5 percent of ballasts in commercial and industrial sectors) that do not fail (and are not replaced due to failure) are retrofitted. However, for several product classes DOE research indicated that the ballasts market is moving in a particular direction. In such instances, DOE adjusted its forecasted growth rates for particular ballast types accordingly. In almost all cases DOE’s approach was to make these adjustments by substituting growth in one product class for another, without adjusting the overall number of forecasted shipments. The only exception is that wherever ballasts operating 4-foot lamps replace ballasts operating 8-foot lamps , DOE assumed this occurs at a 2:1 ratio. In determining what shipment trends to assume for this rulemaking, DO E referenc ed its previous analysis of fluorescent lamp

- and

- ballast shipments , performed as part of its proposed rulemaking for general service fluorescent lamp and incandescent reflector lamps rulemaking (74 FR 34080 (July 14, 2009)) ; hereafter “the 2009 Lamps Rule”). For the commercial sector, historical lamps shipment data and manufacturer interviews indicated significant growth for only 4-foot T8 MBP and 4- foot T5 MiniBP SO systems; consequently, DOE modeled all purchases due to new construction in the commercial sector as being one of these two lamp- and

- ballast systems. DOE model ed commercial sector 4-foot T5 MiniBP SO and HO shipment growth based on a migration from other product classes. DOE’s research indicate d that shipment growth of 4-foot T5 MiniBP SO balla sts is primarily driven by a migration from the 4 -foot MBP market. As this migration requires the purchase of a new fixture, to establish 4 -foot MiniBP T5 SO shipments, DOE allotted a portion of what would otherwise be the 4 -foot MBP fixture new construction/renovation market to 4-foot T5 MiniBP systems. In the 2009 Lamps Rule , DOE first calculated the size of this potential market for new 4 -foot T5 MiniBP SO systems in each year. DOE then determined the portion of this market that would be serviced by 4

- fo ot T5 MiniBP SO systems by calculating the share that resulted in T5 shipments consistent with 2006 and 2007 data. For the ballasts shipments model, DOE h eld th e resulting percentage

— approximately 12.5 percent of the new construction/renovation market—cons tant throughout the analysis period. For 8 -foot T12 cold temperature/sign ballasts, DOE assumed that the new construction market would be split evenly between el ectronic and magnetic ballasts —50 percent each, even in the absence of proposed standard. This recognize d that electronic ballasts provide significant energy savings and would be an attractive replacement for some users

. In the industrial sector, confidential historical shipments sho wed a declining number of 8-foot RDC HO lamps. Therefore, DOE assume d all system purchases due to new construction in the industrial sector are 4 -foot T5 MiniBP HO systems (another rapidly growing market). In the 2009 Lamps Rule, DOE developed 4- foot T5 MiniBP HO ballast shipments by modeling a migration from two different lighting markets. Similar to 8

- foot RDC HO systems, marketing literature indicates a large portion of 4

- foot MiniBP T5 HO systems serve high

- bay applications due to their highly concentrated light output. Historical shipment data for 8

- foot RDC HO l amps show ed substantial declines in 2006 and 2007, indicating T5 HO systems may be rapidly displacing 8-foot RDC HO systems. In addition, DOE’s research indicated that a significant portion of 4-foot T5 MiniBP HO growth can be attributed to their penetration into the high intensity discharge (HID) lamp high- and low-bay markets. Therefore, to calculate the growth in 4-foot MiniBP T5 HO ballast shipments, DOE assumed that these systems were penetrating both the 8

- foot RDC HO and HID markets. Similar to its a nalysis for T5 SO systems, DOE established that the new construction/renovation market segment represents the available market10 -6 for 4 -foot MiniBP T5 HO systems. DOE obtained HID shipment data from the HID lamps rulemaking determination (75 FR 37975 (July 1, 2010)) , from which DOE calculated the total lumens servicing low-bay and high-bay applications. C onsistent with historical 4 -foot T5 MiniBP HO and 8-foot RDC HO shipments, DOE assumed 4- foot T5 MiniBP HO systems fully penetrate the 8 -foot RDC HO new const ruction/renovation market segment as well as the HID new construction/renovation market segment. These same assumptions were applied in the proposed ballast rulemaking. For the residential sector, manufacturer interviews indicated that the majority of new residential 4-foot MBP fixtures use T8 MBP systems. Consequently, DOE model ed only 4-foot T8 MBP lamp

- and

- ballast systems for new construction in the residential sector

. 10.3 BASE

- CASE INPUTS AND FORECASTS
This section describes the two base

- case scenarios DOE employ ed in its analysis and the base

- case input market

- share apportioning for ballast s and presents the base

- case forecasts for each ballast type along with historical ballast shipments data

. 10.3.1 Base- Case Scenarios Analyzed
DOE reco gnizes that rapidly emerging new lighting technologies could penetrate the fluorescent lighting market and significantly affect ballast shipment forecasts. These technologies, such as light- emitting diodes (LEDs) , already are or eventually could be signifi cantly more efficacious and longer lasting than the sources they replace. If emerging technologies achieve their potential, they may significantly affect the benefit calculations from efficiency standards. However, to calculate NES and NPV change d ue to emerging technologies, DOE would need to accurately forecast the anticipated price and performance points of each emerging technology , a difficult and highly speculative task. Because of th is high degree of uncertainly, DOE considered two base- case scenarios for ballast s : e xisting technologies and
e merging technologies. DOE believes evaluating two base- case scenarios will more completely and transparently characterize the uncertainty in estimating emerging technologies’ market penetration and the consequent impact on NPV and NES. Incorporating emerging technologies in the base case does not affect the relative benefits of each TSL and prevents uncertain projections of market share, price, or performance from obscuring the benefits derived from
mo re efficient ballast designs alone. The assumptions and methodology that drive these scenarios and the details specific to each are described in section s 10.3.2 and 10.3.3 , respectively. In general, DOE calculated the market penetration of each of the analyzed emerging technologies annually 2006–2043, assessing each sector separately. DOE then decreased the analyzed market size in each year in each sector by th e amount that corresponded to the highest level of market penetration achieved by a technology.
For its base- case analysis, DOE estimated the market penetration of LED systems into the projected installed stock. In gener al, the existing t echnologies scenario considers only the market penetration of technologies that have reached maturation in terms of price and efficiency

.10 -7 Because LED systems are assumed to have not yet reached maturation , no technologies outside those covered by this rulemaking were analyzed in the e xisting technologies scenario. DOE generally followed a five

- step process for each scenario to estimate the market penetration of the analyzed emerging technologies and account for their impact on NES and NPV. First, DOE developed price, performance, and efficiency forecasts for each of the analyzed emerging technologies. Second, using those estimates, DOE calculated the PBP of each technology in the rele vant sector using the difference between its purchase price, annual electricity cost, and annual replacement cost relative to the fluorescent lamp

- and

- ballast system it replaces. Specifically, DOE use d the following formula to calculate simple PBP:

($/klm/yr) Costt Replacemen Annual ($/klm/yr) Costy Electricit Annual ($/klm) Price Purchase Payback Simple ∆+ ∆ ∆−

=

Where:

Δ = the difference between the two technology options compared , Purchase Price = includes the lamp price and fixture price , Annual Electricity Cost = a function of the mean annual operating hours and efficiency for each technology option, the electricity price, and the lumen demand , and Annual Replacement Cost = a function of the mean ballast li fe, annual operating hours, ballast price, and labor charge. Third, DOE used the relationship between PBP and market penetration to predict the market penetration of each technology in the relevant sector annually 2006–2043. DOE assumed this relationship is valid for other emerging lighting technologies ( i.e. , given a PBP duration, a technology will achieve a certain market penetration ; the shorter the PBP, the greater the expected market penetration ). DOE used a 5- year average of the market penetrations predicted by the relationship as its final market penetration. The 5

- year average represents the time DOE assumed it takes products with lowe r PBPs to penetrate the market. Fourth, when necessary, DOE applied a scaling factor to the predicted market penetration to account for observed market trends. Fifth, the projected installed stock of covered products in each year affected by emerging tech nologies also exhibits decline, similar to shipments . Thus, emerging technologies have the effect of lowering the energy savings of a potential new standard. For those covered ballasts remaining, the cost effectiveness of LCC savings (and thus the relative cost effectiveness of each T SL ) is not impacted

. 10.3.2 Historical Shipments
DOE used U.S. Census Bureau Current Industrial Reports (CIR s ) for ballast s to estimate historical shipments for affected ballast design s. 2 , 3 T he census data contain National Electrical Manufacturers Association ( NEMA ) shipments for individual ballast designs ( e.g ., 2- lamp F96T8) as well as aggregated shipments for multiple designs to keep manufacturer information10 -8 confidential. For some ballast designs, all shipments are withheld in the CIR to prevent disclosing data for individual companies.
DOE estimated historical ballast shipments for 1990–2005 (CIRs for ballasts were discontinued in 2006). For those reporting years for which specific shipments data were not available, DOE extrapolated historical shipments based on trends within the availabl e data, and/or market trends identified in ballast manufacturer interviews, the 2009 Lamps Rule, and the Fluorescent Lamp Ballasts Energy Conservation Standards Final Rule published on Se ptember 19, 2000 (hereafter “the 2000 Ballast Rule” ). 65 FR 56740; 10 CFR 430.23(m)(4). Where shipments data were aggregated and not available for specific ballast designs , DOE estimated historical shipments based on apportionment estimates and market tren ds identified in ballast manufacturer interviews, the 2009 Lamps Rule and the 2000 Ballast Rule. To validate these estimation methods, DOE requested historical ballast and residential fixture shipments from NEMA , but was unable to obtain this data. Recognizing that shipment estimates based on CIR data reflect only the shipments of NEMA members, DOE increase d these estimates to account for the volume of ballasts that nonNEMA companies import or manufacture. Based on ballast manufacturer interviews an d conservative estimates , NEMA shipments were assumed to account for 50 –90 percent of total ballast shipments, depending on the ballast design. Table 10.3.1 presents estimated NEMA and non-NEMA shipment percentages for ballast designs considered in this rulemaking. Table 10.3.2 provides historical fluorescent lamp ballast shipment s estimates for the entire U.S. market.

Table 10.3.1 Estimated NEMA and Non

- NEMA Shipment Percentages for Fluorescent Lamp Ballasts Year 4

- F oot T8 MBP 4

- F oot T12 MBP 8

- F oot T8 S limline 8

- F oot T12 S limline 8

- F oot T8 RDC

HO 8

- F oot T12 RDC HO 4

- F oot T5 MiniBP SO 4

- F oot T5 MiniBP

HO 4

- Foot T8 & T12

MBP (residential) NEMA 90 70 90 70 90 60 90 90 50 Non

- NEMA 10 30 10 30 10 40 10 10 50 Total 100 100 100 100 100 100 100 100 10010 -9 Table 10.3.2 Total Historical Fluorescent Lamp Ballast Shipments (M illions)

Year 4

- F oot T8 MBP 4

- F oot T12 MBP 8

- F oot T8 S limline 8

- F oot T12 S limline 8

- F oot T8 RDC HO 8

- F oot T12 RDC HO 4

- F oot T5 MiniBP SO 4

- F oot T5 MiniBP HO Total

1990 11.3 7.6 0.1 1.0 0.1 3.1 0.0 0.0 23.2 1991 24.6 8.7 0.2 1.0 0.1 3.1 0.0 0.0 37.8 1992 36.3 9.3 0.4 1.0 0.1 3.5 0.0 0.0 50.5 1993 58.4 9.3 0.7 0.9 0.1 3.6 0.0 0.0 73.0 1994 51.9 7.9 0.6 0.9 0.1 3.7 0.0 0.0 65.0 1995 70.5 6.7 1.0 0.9 0.1 3.8 0.0 0.0 83.1 1996 67.2 6.1 0.9 0.9 0.1 3.5 0.0 0.0 78.7 1997 79.3 6.3 1.1 0.7 0.1 3.2 0.0 0.0 90.7 1998 85.8 6.1 1.1 0.7 0.1 2.8 0.0 0.0 96.4 1999 88.6 6.1 1.1 0.6 0.1 3.7 0.0 0.0 100.2 2000 99.8 5.8 1.3 0.6 0.1 3.2 0.0 0.0 110.9 2001 116.1 5.4 1.7 0.6 0.1 3.1 0.0 0.0 127.1 2002 118.8 5.2 1.7 0.6 0.1 3.2 0.9 0.9 131.5 2003 116.4 3.9 1.4 0.5 0.1 3.2 1.9 1.9 129.3 2004 118.6 2.7 1.3 0.5 0.1 3.2 3.2 3.2 133.0 2005 114.4 1.3 1.4 0.5 0.1 3.3 3.4 3.4 127.8
10.3.3 Calculation of Installed Stock
Based on historical ballast shipments estimated from U.S. Census Bureau CIR data and assumed lifetime distributions , DOE calculate d the 2006 ballast stock

. For a mature market, DOE estimat ed the installed stock at the beginning of an analysis period by summing the historical shipments f or the years that correspond to the service lifetime of each ballast type for every sector

. In the future years, installed stock was calculated by subtracting from previous year’s stock the number of ballasts that are estimated to fail and the number of ballasts that were estimated to be retrofitted , and adding current year’s shipments. Current year’s shipments were composed of ballasts that were purchased to replace failed ballasts and ballasts retired due to retrofitting ballasts as well as ballasts shipped to new construction. These new shipments were adjusted by substitution factors, described in the Table 10.2.2 and section 10.2.1.2

. 10.3.4 Base- Case Market

- Share Apportionment As discussed in the engineering analysis ( NOPR TSD chapter 5) and the LCC and PBP analys e s ( NOPR TSD chapter 8), consumers have a variety of choices in replacement ballasts and lamp

- and -ballast systems. When choosing lighting systems, consumers often make their choices considering attributes such as lifetime, efficiency , price, lumen output, rated wattage, and total system power. DOE capture d these considerations by designing product classes that account for these consumer preferences. As discussed earlier, the shipments for ballasts depend on such input assumptions as ballast lifetime and system lumen output. In addition, other ballast or lamp

- and

- ballast system properties su ch as price and energy consumption were key inputs to the NES and NPV calculations. Therefore, within each product class, DOE believe d it was necessary to directly account for the mix of technologies that consumers select in the base case and standards cas e. To account for the range of possible consumer choices, DOE develop ed10

- 10 technology market- share apportionments . These market

- share apportionments were used to estimate historical shipments and installed stock for each ballast design in the base case

. DOE was not able to obtain detailed historical ballast shipment data from NEMA to develop percentage market shares for the analyzed ballast designs. However, based on manufacturer interviews, DOE was able to develop a general assumed market

- share apportionment based on shipments of 4-foot T8 MBP electronic ballasts. Interviewed manufacturers provided estimated percentages of standard- efficiency and high

- efficiency T8 ballasts sold through original equipment manufacturer ( OEM ) fixture and electrical wholesaler distribution channels. As presented in Table 10.3.3 , DOE developed weighted apportionment s for the two efficiency levels. Specifically, DOE assume d that 69 percent of shipped 4-foot T8 MBP electronic ballasts are standard -efficiency designs, and 31 percent are high

- efficiency designs.

Table 10.3.3 Weighted Apportionments for Standar d- and High- Efficiency 4 -Foot T8 MBP Ballasts Ballast Efficiency Shipments T hrough Distribution Channel % Fixture OEM Electrical Wholesaler Weighted Average Standard 80 50 69 High 20 50 31 Overall v olume t hrough d istribution c hannel * 63 37 100

* Pe r centages from the 2000 Ballast Rule

. DOE believes that this apportionment is a reasonable estimate for the other ballast product classes analyzed in the base

- case shipments model, as it reflects the assumed tendency of most consumers to minimize their first cost and select standard

- efficienc y designs if not otherwise required. Consequently, for each product class in the base case, DOE apportion ed 69 percent of shipments to the baseline ballast design, and divided the remaining 31 percent of shipments ( i.e. , the high-efficiency apportionment) among the higher efficiency level (E L) designs. In most cases there were two ELs in addition to baseline, so the split was even or 20 percent were attributed to EL1 and 11 percent to EL 2. In some cases (like with sign ballasts), DOE had separated series f rom CIR for the two efficiency levels, so the split assumptions were not necessary

. 10.3.5 Base- Case Forecast Results Figure 10.3.1 and Figure 10.3.2 , respectively , present the base

- case ballast shipments forecasts fo r existing technologies case and emerging technologies case from 2014–2043, modeled from the 2006 installed stock (based on 1990–2005 historical shipments) and growth

r ates, substitution rates , and retrofit rates. For categories of ballasts that are expect ed to experience penetration of emerging technologies (for instance, two lamp 4- foot MBP), base case scenarios would differ, while for the rest the series are the same.10

- 11 Figure 10.3.1 Base-Case Forecasted Ballast Shipments (Existing Technologies Scenarios) - 20,000,000 40,000,000 60,000,000 80,000,000 100,000,000 120,000,000Shipments Two Lamp Normal BF 4ft MBP IS & RS

Two Lamp Normal BF 4ft MBP PS

Four Lamp Normal BF 4ft MBP IS & RS

Four Lamp Normal BF 4ft MBP PS

Two Lamp Normal BF 8ft SP Slimline

Two Lamp 8ft RDC HO IS & RS

Two Lamp Normal BF 4ft T5 MiniBP SO

Two Lamp 4ft T5 MiniBP HO

Two Lamp 4ft MBP IS & RS Residential

Four Lamp Sign Ballast10

- 12 Figure 10.3.2 Base-Case Forecasted Ballast Shipments ( Emerging Technologies Scenarios) - 10,000,000 20,000,000 30,000,000 40,000,000 50,000,000 60,000,000 70,000,000 80,000,000Shipments Two Lamp Normal BF 4ft MBP IS & RS

Two Lamp Normal BF 4ft MBP PS

Four Lamp Normal BF 4ft MBP IS & RS

Four Lamp Normal BF 4ft MBP PS

Two Lamp Normal BF 8ft SP Slimline

Two Lamp 8ft RDC HO IS & RS

Two Lamp Normal BF 4ft T5 MiniBP SO

Two Lamp 4ft T5 MiniBP HO

Two Lamp 4ft MBP IS & RS Residential

Four Lamp Sign Ballast10

- 13 10.3.6 Base- Case Forecast by Market Segment Figure 10.3.3 through Figure 10.3.6 present the base

- case ballast shipments forecast by market segment ( i.e. , ballast failure/replacement, or new construction/renovation) for representative product classes. For three of product classes , shipments of replacements dominate shipments related to new construction/renovation over the analysis period. Note tha t 8 -foot slimline ballasts are only shipped for replacement . They are substituted in the new construction by T5 ballast systems. The figures below are for the e xisting t echnologies scenario.

Figure 10.3.3 Product Class 1— IS a nd RS Ballasts That Operate 4- Foot MBP and 8 -Foot Slimline Lamps : Ballast Shipments Forecast by Market Segment (Existing Technologies Scenario) - 50 100 150 200 250Shipments in millions

PC 1 Replacement PC 1 New construction10

- 14 Figure 10.3.4 Product Class 2— PS Ballasts That Operate 4- Foot MBP , MiniBP SO and MiniBP HO Lamps : Ballast Shipments Forecast by Market Segment (Existing Technologies Scenario)

Figure 10.3.5 Product Class 3— IS a nd RS Ballasts That Operate 8

- Foot RDC HO Lamps : Ballast Shipments Forecast by Market Segment (Existing Technologies Scenario) - 20 40 60 80 100 120 140 160 180Shipments in millions

PC 2 Replacement PC 2 New construction

- 10 20 30 40 50 60 70 80Shipments in thousands

PC 3 Replacement10

- 15 Figure 10.3.6 Product Class 5— IS a nd RS Ballasts That Operate 8

- Foot RDC HO Lamps i n Cold T emperature Outdoor Signs: Ballast Shipments Forecast by Market Segment (Existing Technologies Scenario)

10.4 S TANDARDS

- CASE INPUTS
To characterize consumer behavior in the standards case , DOE consider ed many characteristics that consumers take into account when purchasing their lamp

- and

- ballast system s. Specifically, DOE regard ed system price, system energy consumption, and system lumen output as three key drivers of consumer purchases.
DOE develop ed two sets of two shipments scenarios to characterize consumers that may weigh th ese factors differently

. To evaluate a standards case , DOE model ed a standards- case scenario and compare d it to the base case.
The first set of standards- case scenarios for ballasts included the roll-up and s hift scenarios. The roll-up scenario represented a standards case in which all product efficiencies in the base case that do not meet the standard would roll up to meet the new standard level. Consumers in the base- case purchase ballasts above the standard level are not affected as they
were assumed t o continue to purchase the same base

- case ballast or lamp

- and

- ballast system in the roll-up scenario . The roll-up scenario characterizes consumers primarily driven by the first

cost of the analyzed equipment. In a roll-up scenario , DOE assume d consumers will buy the first standard

- compliant lamp

- and

- ballast system available. In contrast, in a shift scenario, DOE
assume d consumers seek to s hift to an efficiency level that keeps their purchase the same number of efficiency levels above the baseline as in the base case . T he s hift scenario model ed a standards
case in which all base

- case consumer purchases are affected by the standard. In this scenario, any consumer may purchase a more efficient ballast

. As the standard level increases, market share incrementally accumulates at the highest E L because it represents “max tech” ( i.e. , moving beyond it is impossible given available technology options ). The s hift scenario characterizes - 1 2 3 4 5 6 7 8Shipments in millions

PC 5 Replacement PC 5 New construction10

- 16 consumers primarily concerned with system energy consumption , and reflects an upper bound scenario

. In this rulemaking , DOE modeled shift scenario with a modification. It assumed that all the ballasts that are below the efficiency level established by the standard would roll up to the level required by the standard, and only the co nsumers of the ELs above the established standard would shift to a higher efficiency level than required. This adjustment would allow ballast shipments to be divided mor e realistically among EL s, when more than one EL is available on the market. Energy savings will be lower compared to “pure” shift scenario, but they represent a re -attainable boundary.
In either the roll-up or s hift scenario , consumers will attempt to buy a ballast from t he
same product class as their previous ly demanded system , except w here additional replacement trends are modeled (as given in Table 10.2.2 ). The structure of these product classes is such that at each E L level lumen output is within 10 percent of the baseline system’s lumen output. Each of these pairs of scenarios ( roll-up and shift) occurs in combination with the existing and e merging technologies scenarios from the base case, for a total of four standardscase scenarios.

M any tables for the shipments analysis , NIA ( NOPR TSD chapter 11), and some other downstream analyses present only two of the four possible shipments scenarios: e xisting technology, s hift and e merging technology, roll- up . These scenarios are presented because they produce the upper and lower bound scenarios for the energy impacts of this rulemaking, respectively.

10.5 RESULTS The following sections show the shipments forecasts for the various efficiency levels over time and by shipments scenario. DOE’s forecasts of the resultant stock forecasts for the various efficiency levels over time and by scenario are presented in NOPR TSD chapter 11. Figure 10.5.1 through Figure 10.5.10 present the shipments forecasts for the base case and standards cases for ballasts in the e xisting technologies, s hift scenario

. As noted, this reflect s the upper-bound scenario for ene rgy use . For the standards case, shipments are shown at what they are modeled as in the TSL 3 scenario.10

- 17 Figure 10.5.1 Product Class 1— IS a nd RS Ballasts That Operate Two 4- Foot MBP Lamps (C ommercial) : Base- Case and Standards -Case Ballast Shipments Forecasts ( Existing Technologies, Shift Scenario)

Figure 10.5.2 Product Class 1— IS a nd RS Ballasts That Operate Two 4- Foot MBP Lamps (R esidential) : Base- Case and Standards -Case Ballast Shipments Forecasts ( Existing Technologies, Shift Scenario) - 10 20 30 40 50 60 70 80 90 100

2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 2034 2036 2038 2040 2042 2044Millions

Base Case Baseline Base Case EL 1 (T8 Baseline)
Base Case EL 2 Base Case EL 3
TSL 3 EL 3

- 10 20 30 40 50 60 70 80Millions

Base Case Baseline Base Case EL 1 (T8 Baseline)
Base Case EL3 TSL 3 EL 310

- 18 Figure 10.5.3 Product Class 1— IS a nd RS Ballasts That Operate Four 4- Foot MBP Lamps: Base- Case and Standards

- Case Ballast Shipments Forecasts ( Existing Technologies, Shift Scenario)

Figure 10.5.4 Product Class 1— IS a nd RS Ballasts That Operate Two 8- Foot Slimline Lamps: Base- Case and Standards

- Case Ballast Shipments For ecasts ( Existing Technologies, Shift Scenario) - 5 10 15 20 25 30 35Millions

Base Case Baseline/EL2 Base Case EL 3 TSL 3 EL 3

- 200 400 600 800 1,000 1,200 1,400 1,600Thousands

Base Case Baseline/EL1 Base Case Baseline/EL2
Base Case EL 3 TSL 3 EL 310

- 19 Figure 10.5.5 Product Class 2— PS Ballasts That Operate Two 4- Foot MBP Lamps: BaseCase and Standards

- Case Ballast Shipments Forecasts ( Existing Technologies, Shift Scenario)

Figure 10.5.6 Product Class 2— PS Ballasts That Operate Four 4- Foot MBP Lamps: BaseCase and Standards

- Case Ballast Shipments Forecasts ( Existing Technologies, Shift Scenario) - 1 2 3 4 5 6 7 8 9 10Millions

Base Case Baseline Base Case EL 2 Base Case EL 3 TSL 3 EL 3

- 2 4 6 8 10 12Millions

Base Case Baseline Base Case EL 1 Base Case EL 3 TSL 3 EL 310

- 20 Figure 10.5.7 Product Class 2— PS Ballasts That Operate Two 4- Foot MiniBP SO Lamps: Base- Case and Standards -Case Ballast Shipments Forecasts (Existing Technologies, Shift Scenario)

Figure 10.5.8 Product Class 2— PS Ballasts That Operate Two 4- Foot MiniBP HO Lamps: Base- Case and Standards -Case Ballast Shipments Forecasts (Existing Technologies, Shift Scenario) - 20 40 60 80 100 120 140Millions

Base Case Baseline Base Case EL 1 Base Case EL 2
Base Case EL 3 TSL 3 EL 3

- 5 10 15 20 25 30 35Millions

Base Case Baseline Base Case EL 1 Base Case EL 2
Base Case EL 3 TSL 3 EL310

- 21 Figure 10.5.9 Product Class 3— IS and RS Ballasts That Operate Two 8- Foot RDC HO Lamps: Base- Case and Standards -Case Ballast Shipments Forecasts (Existing Technologies, Shift Scenario)

Figure 10.5.10 Product Class 5— IS And RS Ballasts That Operate Four 8

- Foot RDC HO Lamps in Cold Temperature Outdoor Signs: Base

- Case and Standards -Case Ballast Shipments Forecasts (Existing Technologies, Shift Scenario) - 10 20 30 40 50 60 70 80Thousands

Base Case Baseline Base Case EL 1 Base Case Baseline/EL 2
Base Case EL 3 TSL 3 EL 3

- 1 2 3 4 5 6 7 8Millions

Base Case Baseline Base Case EL 1 TSL 3 EL 110

- 22 REFERENCES 1. U.S. Department of Energy–Energy Information Administration. Annual Energy Outlook 2010 with Projections to 2035 . March 2010.
< http://www.eia.doe.gov/oiaf/aeo/aeoref_tab.html >.

2. U.S. Census Bureau. Current Industrial Reports, Fluorescent Lamp Ballasts: 2005

. July 2006. Washington, D.C. < http://www.census.gov/industry/1/mq335c055.pdf >. 3. U.S. Census Bureau. Current Industrial Reports, Fluorescent Lamp Bal lasts (individual annual reports for 1990

− 1996). MQ36C(90)-5 through MQ36C(96)-5. Washington, D.C.