9274 Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Rules and Regulations 

the relationship between the national 

government and the States, or on the 

distribution of power and 

responsibilities among the various 

levels of government. 

For the reasons discussed above, I 

certify that this AD: 

(1) Is not a ‘‘significant regulatory 

action’’ under Executive Order 12866, 

and 

(2) Will not affect intrastate aviation 

in Alaska. 

List of Subjects in 14 CFR Part 39 

Air transportation, Aircraft, Aviation 

safety, Incorporation by reference, 

Safety. 

The Amendment 

Accordingly, under the authority 

delegated to me by the Administrator, 

the FAA amends 14 CFR part 39 as 

follows: 

PART 39—AIRWORTHINESS 

DIRECTIVES 

■ 1. The authority citation for part 39 

continues to read as follows: 

Authority: 49 U.S.C. 106(g), 40113, 44701. 

§ 39.13 [Amended] 

■ 2. The FAA amends § 39.13 by adding 

the following new airworthiness 

directive: 

2021–04–06 Pilatus Aircraft Ltd.: 

Amendment 39–21427; Docket No. 

FAA–2021–0049; Project Identifier 

MCAI–2021–00033–A. 

(a) Effective Date 

This airworthiness directive (AD) is 

effective February 12, 2021. 

(b) Affected ADs 

None. 

(c) Applicability 

This AD applies to Pilatus Aircraft Ltd. 

Model PC–7 airplanes, all serial numbers, 

certificated in any category. 

(d) Subject 

Joint Aircraft System Component (JASC) 

Code 2510, Flight Compartment and 2560, 

Emergency Equipment. 

(e) Unsafe Condition 

This AD was prompted by a report of a 

missing release bar retaining screw on a 

Harley-type buckle assembly installed on a 

harness shoulder strap. The FAA is issuing 

this AD to detect and address defective 

buckle assembly release bar screws. The 

unsafe condition, if not addressed, could 

result in loss of pilot restraint with 

consequent loss of airplane control or 

injuries to the crew. 

(f) Actions and Compliance 

(1) For airplanes with a Harley-type seat 

buckle assembly or buckle component listed 

in the Effectivity, paragraph 2.A., of IrvinGQ 

Limited Service Bulletin IGQSB033, Issue 2, 

dated December 2020 (IrvinGQ SB 

IGQSB033, Issue 2), before further flight after 

the effective date of this AD, inspect each 

seat buckle assembly on the front and rear 

seats (4 buckle assemblies total) for 

movement of the release bar retaining screws 

by following the Accomplishment 

Instructions, section 3.C.(1), of IrvinGQ SB 

IGQSB033, Issue 2. If there is any movement 

of a release bar retaining screw, before further 

flight, repair or replace the buckle assembly 

by following the Accomplishment 

Instructions, section 3.C.(2), of IrvinGQ SB 

IGQSB033 Issue 2. 

(2) As of the effective date of this AD, do 

not install a Harley-type buckle assembly or 

buckle component listed in the Effectivity, 

paragraph 2.A., of IrvinGQ SB IGQSB033 

Issue 2, on the seat harness of any airplane 

unless it has been inspected as required by 

paragraph (f)(1) of this AD. 

(g) Special Flight Permit 

A special flight permit may be issued with 

the following limitations: Operation in areas 

of known turbulence and aerobatic flight are 

prohibited. 

(h) Alternative Methods of Compliance 

(AMOCs) 

(1) The Manager, International Validation 

Branch, FAA, has the authority to approve 

AMOCs for this AD, if requested using the 

procedures found in 14 CFR 39.19. In 

accordance with 14 CFR 39.19, send your 

request to your principal inspector or local 

Flight Standards District Office, as 

appropriate. If sending information directly 

to the manager of the certification office, 

send it to the attention of the person 

identified in Related Information. 

(2) Before using any approved AMOC, 

notify your appropriate principal inspector, 

or lacking a principal inspector, the manager 

of the local flight standards district office/ 

certificate holding district office. 

(i) Related Information 

(1) Refer to Federal Office of Civil Aviation 

(FOCA) AD HB–2021–001–E, dated January 

8, 2021, for more information. You may 

examine the FOCA AD at https://

www.regulations.gov by searching for and 

locating Docket No. FAA–2021–0049. 

(2) For more information about this AD, 

contact Doug Rudolph, Aviation Safety 

Engineer, General Aviation & Rotorcraft 

Section, International Validation Branch, 

FAA, 901 Locust, Room 301, Kansas City, 

Missouri 64106; phone: (816) 329–4059; fax: 

(816) 329–4090; email: doug.rudolph@

faa.gov. 

(j) Material Incorporated by Reference 

(1) The Director of the Federal Register 

approved the incorporation by reference of 

the service information listed in this 

paragraph under 5 U.S.C. 552(a) and 1 CFR 

part 51. 

(2) You must use this service information 

as applicable to do the actions required by 

this AD, unless the AD specifies otherwise. 

(i) IrvinGQ Limited Service Bulletin 

IGQSB033, Issue 2, dated December 2020. 

(ii) [Reserved] 

(3) For IrvinGQ Limited service 

information identified in this AD, contact 

Pilatus Aircraft Ltd., CH–6371, Stans, 

Switzerland; phone: +41 848 24 7 365; email: 

techsupport.ch@pilatus-aircraft.com; 

website: http://www.pilatus-aircraft.com/. 

(4) You may view this service information 

at FAA, Airworthiness Products Section, 

Operational Safety Branch, 901 Locust, 

Kansas City, Missouri 64106. For information 

on the availability of this material at the 

FAA, call (816) 329–4148. 

(5) You may view this service information 

that is incorporated by reference at the 

National Archives and Records 

Administration (NARA). For information on 

the availability of this material at NARA, 

email: fedreg.legal@nara.gov, or go to: 

https://www.archives.gov/federal-register/cfr/ 

ibr-locations.html. 

Issued on February 4, 2021. 

Gaetano A. Sciortino, 

Deputy Director for Strategic Initiatives, 

Compliance & Airworthiness Division, 

Aircraft Certification Service. 

[FR Doc. 2021–02793 Filed 2–10–21; 11:15 am] 

BILLING CODE 4910–13–P 

FEDERAL TRADE COMMISSION 

16 CFR Part 305 

RIN 3084–AB15 

Energy Labeling Rule 

AGENCY: Federal Trade Commission. 

ACTION: Final rule. 

SUMMARY: The Federal Trade 

Commission (‘‘FTC’’ or ‘‘Commission’’) 

amends the Energy Labeling Rule 

(‘‘Rule’’) to require EnergyGuide labels 

for portable air conditioners and issue 

amendments to central air conditioner 

labels to conform with Department of 

Energy (‘‘DOE’’) changes to efficiency 

descriptors. 

DATES: Amendatory instructions 1 

(authority), 3 (for § 305.2), 5 (for 

§ 305.3), 6 (for § 305.7), 7 (for § 305.10), 

8 (for § 305.11), 9 (for § 305.13), 10 (for 

§ 305.18), 12 (for § 305.27), 13 (for 

appendix E), and 14 (for appendix K2) 

are effective on October 1, 2022, and 

amendatory instructions 2 (for part 305), 

4 (for § 305.2), and 11 (for § 305.20) are 

effective on January 1, 2023. 

ADDRESSES: Copies of this document are 

available on the Commission’s website, 

www.ftc.gov. 

FOR FURTHER INFORMATION CONTACT: 

Hampton Newsome (202–326–2889), 

Attorney, Bureau of Consumer 

Protection, Federal Trade Commission, 

Room CC–9528, 600 Pennsylvania 

Avenue NW, Washington, DC 20580. 

SUPPLEMENTARY INFORMATION: 

Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Rules and Regulations 9275 

1 44 FR 66466 (Nov. 19, 1979). 

2 42 U.S.C. 6294. EPCA also requires the 

Department of Energy (‘‘DOE’’) to develop test 

procedures that measure how much energy 

appliances use, and to determine the representative 

average cost a consumer pays for different types of 

energy. 

3 16 CFR 305.10. 

4 79 FR 34642 (June 18, 2014); 80 FR 67351 (Nov. 

2, 2015); 81 FR 62681 (Sept. 12, 2016); and 82 FR 

29230 (June 28, 2017). Earlier in this proceeding, 

the Commission waited on label requirements 

pending a final DOE-issued test procedure for these 

products. DOE published that test procedure on 

June 1, 2016 (81 FR 35242), and it became 

mandatory for energy use representations on 

November 28, 2016. 

5 80 FR at 67357; and 81 FR at 62683. In 

discussing similar economic and technological 

feasibility determinations for labels in 1979, the 

Commission concluded ‘‘that Congress[’s] intent 

was to permit the exclusion of any product 

category, if the Commission found that the costs of 

the labeling program would substantially outweigh 

any potential benefits to consumers.’’ 44 FR at 

66467–68 (discussing determinations under 42 

U.S.C. 6294(a)(1)). 

6 82 FR at 29232. 

7 85 FR 1378 (Jan. 10, 2020). 

8 80 FR at 67357–58. 

9See 78 FR 40403, 40404–05 (July 5, 2013). 

10The most recent DOE shipment statistics are 

from 2014. 85 FR 1378; and ‘‘2016–12 Final Rule 

Technical Support Document: Energy Efficiency 

Program for Consumer Products and Commercial 

and Industrial Equipment: Portable Air 

Conditioners’’ (‘‘DOE TSD’’) December 2016 at 

https://www.regulations.gov/document?D=EERE2013-BT-STD-0033-0047. 

11 DOE TSD at Table 7.3.2. 

12See 80 FR at 67357 and 81 FR at 62683. 

I. Background on the Energy Labeling 

Rule 

The Commission issued the Energy 

Labeling Rule (‘‘Rule’’) in 1979,1

pursuant to the Energy Policy and 

Conservation Act of 1975 (‘‘EPCA’’).2

The Rule requires energy labeling for 

major home appliances and other 

consumer products to help consumers 

compare the energy usage and costs of 

competing models. It also contains 

labeling requirements for refrigerators, 

refrigerator-freezers, freezers, 

dishwashers, water heaters, clothes 

washers, room air conditioners, 

furnaces, central air conditioners, heat 

pumps, plumbing products, lighting 

products, ceiling fans, and televisions. 

The Rule requires manufacturers to 

attach yellow EnergyGuide labels to 

many of the covered products and 

prohibits retailers from removing these 

labels or rendering them illegible. In 

addition, it directs sellers, including 

retailers, to post label information on 

websites and in paper catalogs from 

which consumers can order products. 

EnergyGuide labels for most covered 

products contain three key disclosures: 

Estimated annual energy cost, a 

product’s energy consumption or energy 

efficiency rating as determined by DOE 

test procedures, and a comparability 

range displaying the highest and lowest 

energy costs or efficiency ratings for all 

similar models. The Rule requires 

marketers to use national average costs 

for applicable energy sources (e.g., 

electricity, natural gas, oil) as calculated 

by DOE in all cost calculations. Under 

the Rule, the Commission periodically 

updates comparability range and annual 

energy cost information based on 

manufacturer data submitted pursuant 

to the Rule’s reporting requirements.3

II. Notice of Proposed Rulemaking 

In an April 10, 2020 Notice of 

Proposed Rulemaking (NPRM) (85 FR 

20218), the Commission sought 

comments on EnergyGuide labels for 

portable air conditioners, updates to 

efficiency descriptors for central air 

conditioner labels, and the need for 

changes to the current label layout and 

format requirements. 

A. Proposed EnergyGuide Labels for 

Portable Air Conditioners 

The NPRM proposed establishing 

EnergyGuide labeling for portable air 

conditioners. Under EPCA, the 

Commission may require labeling for 

DOE-designated covered products if it 

determines labeling will ‘‘assist 

purchasers in making purchasing 

decisions’’ and will be ‘‘economically 

and technologically feasible.’’ 42 U.S.C. 

6294(a)(3). Prior to the NPRM, the 

Commission sought comment on 

labeling requirements for portable air 

conditioners in several previous Federal 

Register notices. In those publications, 

the Commission discussed the benefits 

and burdens of such labels, as well as 

their format and content, which would 

largely match the labels already 

required for room air conditioners.4

Over the course of this proceeding, the 

Commission found, in accordance with 

its EPCA authority, labeling for this 

product category is likely to be 

economically and technologically 

feasible and assist consumers in their 

purchasing decisions.5 Over several 

rounds of comments, a wide array of 

stakeholders, including industry 

members, utilities, and consumer 

groups supported (or did not oppose) 

the proposal. 

In 2017, the Commission delayed 

final label requirements due to 

uncertainty about when DOE would 

promulgate efficiency standards for 

these products.6 Specifically, in January 

of that year, DOE withdrew its final 

efficiency standards from Federal 

Register publication pursuant to the 

Presidential Memorandum on 

Implementation of Regulatory Freeze, 

leaving the final standards compliance 

date unclear. In early 2020, DOE 

announced a compliance date for the 

standards resolving any uncertainty.7

Accordingly, the Commission then 

released an NPRM proposing 

EnergyGuide labels for portable air 

conditioners and a January 10, 2025 

compliance date to coincide with the 

effective date of the DOE standards. 

In previous notices on these issues, 

the Commission addressed the benefits 

as well as the economic and 

technological feasibility of portable air 

conditioner labels. In a 2015 notice, for 

example, it found portable air 

conditioners are common in the 

marketplace, vary in energy efficiency, 

and use energy similar to or greater 

than, currently labeled room air 

conditioners.8 In addition, DOE 

reported the aggregate energy use of 

portable air conditioners has increased.9

According to DOE estimates, sellers 

shipped 1.32 million units in the United 

States in 2014, with future growth 

projected.10

DOE also found these products 

exhibit a wide range of efficiency ratings 

and energy costs for similarly sized 

units (a difference of about $100 per 

year between the most and least 

efficient models). After the 2025 

implementation of DOE standards, that 

range is likely to be smaller, but remain 

significant (a difference of about $30– 

$50 depending on the size category as 

indicated in Appendix E2). DOE 

estimated average per-household annual 

electricity consumption for these 

products at 804 kWh/yr, generating 

$105 in annual energy costs (at $0.13 

per kWh/hr).11 Given this information, 

the Commission concluded energy 

labels are likely to assist consumers 

with their purchasing decisions by 

allowing them to compare the energy 

costs of competing models and, 

consequently, save significant money on 

their electric bills. 

Further, in the NPRM, the 

Commission stated there is no evidence 

labeling is economically or 

technologically infeasible (i.e., the costs 

of labeling substantially outweigh 

consumer benefits). Indeed, the burdens 

(discussed infra in the Paperwork 

Reduction Act section) of labeling are 

not likely to differ significantly from 

those for room air conditioners, which 

already have EnergyGuide labels.12

As discussed in the NPRM, the 

proposed portable air conditioner label 

would be mostly identical to the current 

room air conditioner label in content, 

format, and placement (i.e., on 

packaging, not the product itself). The 

proposed amendments incorporated 

DOE’s definition of ‘‘portable air 

9276 Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Rules and Regulations 

13To effect new labeling requirements, the 

proposed amendments inserted the term ‘‘portable 

air conditioner’’ next to ‘‘room air conditioner’’ into 

appropriate paragraphs of the Rule as detailed in 

the amendatory language included in this Notice. 

14See DOE TSD, Chapter 3 at 24–25 and Ch. 5 

at 5–20. Using estimates for the most energy 

consumptive models based on the DOE standards, 

the ranges by size category expressed in yearly 

energy consumption are: (1) Less than 6,000 Btu/ 

hr: (375–753 kWh/yr), (2) 6,000 to 7,999 Btu/hr: 

(663–916 kWh/yr), and (3) 8,000 Btu/yr or greater: 

(807–1034 kWh/yr). 

15 81 FR at 62682; and 82 FR at 29231–29232. 

16 82 FR 29231. 

17 82 FR 1786 (Jan. 6, 2017); and 82 FR 24211 

(May 26, 2017). 

18The comments are available at 

www.regulations.gov. The comments consist of AirConditioning, Heating, and Refrigeration Institute 

(AHRI) (#33–09); Association of Home Appliance 

Manufacturers (AHAM) (#33–04); Appliance 

Standards Awareness Project (ASAP) (including 

American Council for an Energy-Efficient Economy 

(ACEEE), National Consumer Law Center, on behalf 

of its low-income clients (NCLC), Natural Resources 

Defense Council (NRDC), & Northwest Energy 

Efficiency Alliance (NEEA)) (ASAP et al.) (#33–06); 

Goodman Manufacturing (#33–08); Jieun Rim (#33– 

02); Consumer Federation of America, National 

Consumer Law Center, Sierra Club, Earthjustice 

(‘‘Joint Commenters’’) (#33–05); and the California 

Investor-Owned Utilities (Pacific Gas and Electric 

Company, San Diego Gas and Electric, and 

Southern California Edison) (CA IOUs) (#33–07). 

19 Joint Commenters, Jieun Rim, and ASAP et al. 

supported the proposal. AHAM stated that it did 

not oppose the labeling. 20See ASAP et al. and AHAM. 

conditioner’’ at § 305.3.13 Applying the 

same electricity cost rate ($0.13 kWh/hr) 

currently used for room air 

conditioners, the NPRM also contained 

cost ranges specifically for portable air 

conditioners in three size categories and 

derived from DOE energy use data.14

Consistent with findings made in the 

2016 and 2017 notices, the NPRM did 

not propose combining the ranges for 

portable and room air conditioners 

because it is not clear whether 

consumers routinely compare the two 

product categories when shopping.15

However, consumers who want to 

compare them would be able to do so 

easily using the label’s energy cost 

disclosure. In addition, consistent with 

provisions applicable to room air 

conditioners, the proposed amendments 

contained reporting requirements 

identical to those created by DOE for 

these products. 

Finally, in the NPRM, the 

Commission proposed establishing an 

effective date for the label coinciding 

with the compliance date for DOE 

standards. Citing burdens associated 

with testing and labeling, industry 

comments earlier in this proceeding 

urged the Commission to synchronize 

any new labeling requirements with the 

DOE standards compliance date.16

B. Efficiency Descriptors for Central Air 

Conditioners 

In the NPRM, the Commission also 

sought comments on updates to the 

efficiency descriptors on central air 

conditioner labels. In 2017, as part of an 

efficiency standards proceeding, DOE 

announced changes to the rating 

methods and associated efficiency 

descriptors for central air conditioners 

(e.g., from ‘‘Seasonal Energy Efficiency 

Ratio (SEER)’’ to ‘‘Seasonal Energy 

Efficiency Ratio 2 (SEER2)’’).17 The DOE 

changes become effective on January 1, 

2023. To ensure consistency with the 

DOE standards, the NPRM proposed 

changing all applicable references in 

Part 305, effective on January 1, 2023. 

Given the relatively small differences in 

the ratings produced by the old and the 

new rating methods, the Commission 

did not propose any additional label 

changes. The Commission noted plans 

to update ranges in Appendix H and I, 

as well as applicable numbers on the 

sample labels in Appendix L, when new 

data becomes available. 

C. Questions on Label Layout and 

Format Requirements 

The Commission also requested 

comment on whether it should revise 

requirements in the Rule related to 

layout, format, and placement of 

EnergyGuide labels. Specifically, the 

NPRM asked whether some of these 

requirements (e.g., § 305.13(b)) are too 

prescriptive. In addition, the NPRM 

asked whether the Rule should contain 

a general label durability and disclosure 

format requirement in lieu of the 

existing, specific provisions for layout, 

type style, setting, and label attachment. 

The NPRM also asked whether industry 

members interpret existing guidance in 

the Rule related to adhesive labels as a 

‘‘required standard.’’ Finally, the NPRM 

contained several questions about the 

Rule’s cost and benefits and the 

potential impact of more flexible 

requirements. 

V. Comments on the NPRM 

The Commission received seven 

comments in response to the NPRM.18

As detailed below, the commenters 

generally supported (or did not oppose) 

labels for portable air conditioners and 

the transition to the new DOE efficiency 

descriptors. However, they provided 

differing views on the need to revise 

existing label requirements. Finally, 

some commenters offered broad 

suggestions for replacing physical labels 

with electronic labels. 

A. Portable Air Conditioner Labels 

All the commenters supported (or did 

not oppose) adding portable air 

conditioner labels to the Rule.19 As 

discussed below, they asserted the 

labels’ energy cost information would 

help consumers choose among portable 

air conditioners and alert them to the 

relative cost of portable and room 

models. The commenters also supported 

providing comparability ranges separate 

from room air conditioners. 

The comments emphasized the label’s 

consumer benefits. For example, CFA 

explained the labels ‘‘will provide 

significant value to consumers making 

purchasing decisions.’’ The Joint 

Commenters noted the energy costs 

disclosures ‘‘will correctly indicate to 

consumers that portable units are 

typically less efficient than room air 

conditioners.’’ AHAM, which represents 

portable air conditioner manufacturers, 

did not oppose the label but, as 

discussed further below, urged the 

Commission to eliminate physical labels 

for all products and transition to an 

electronic label structure. 

The commenters supported (or did 

not oppose) separate comparability 

ranges for portable and room air 

conditioners. AHAM, which ‘‘fully 

agreed’’ with the proposed approach on 

ranges, explained ‘‘consumers can 

adequately compare the two products, 

to the extent they even wish to do so for 

these two different products, easily 

using the label’s energy cost 

disclosure.’’ Referencing earlier 

comments, it argued combining the 

ranges would cause confusion because 

consumers of these products are 

different, and the two air conditioner 

categories do not have similar usage. 

AHAM also argued consumers focus 

mostly on capacity and purchase price 

when buying air conditioner units and 

thus may not use comparative energy 

costs information between the two 

categories. 

Commenters further recommended 

two additional items. First, two 

commenters noted the regulatory text in 

§ 305.10 should include a reference for 

DOE capacity and rounding 

determinations for portable air 

conditioners (Appendix CC to 10 CFR 

part 430, subpart B).20 Second, the CA 

IOUs recommended statements on 

product packaging and literature about 

proper portable air conditioner 

operation, explaining the need for 

ducting to vent the heat produced by a 

unit to the outside. 

Commenters, however, offered 

differing views on the timing for the 

new labels. AHAM strongly supported a 

compliance date coinciding with the 

DOE standards. It asserted that 

designing products to meet the new 

standards requires ‘‘considerable effort,’’ 

a fact reflected in EPCA’s five-year leadVerDate Sep<11>2014 16:41 Feb 11, 2021 Jkt 253001 PO 00000 Frm 00024 Fmt 4700 Sfmt 4700 E:\FR\FM\12FER1.SGM 12FER1
Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Rules and Regulations 9277 

in period for DOE standards. According 

to AHAM, the pre-development, 

development, and tooling phases of 

launching a new product take years to 

complete and require extensive 

company resources. In its view, 

instituting a label mandate prior to the 

DOE compliance date would require 

companies to divert resources from 

developing new, more efficient products 

to labeling. AHAM also explained that 

aligning the compliance dates with the 

DOE standards and EnergyGuide labels 

would allow manufacturers to engage in 

the extensive development and testing 

activities required to innovate and bring 

more efficient products to market, as 

well as to comply with regulatory 

requirements. 

In contrast, the Joint Commenters, 

ASAP et al., and the California InvestorOwned Utilities (CA IOUs) disagreed. 

The Joint Commenters argued 

consumers who currently lack the 

protection of a DOE minimum efficiency 

standard should have access to labels 

sooner to help identify and avoid 

inefficient models. Given the delays in 

the proceeding caused by the DOE 

litigation, these commenters argued 

manufacturers have had ‘‘ample time to 

make the investments they have claimed 

are necessary to deploy the labels.’’ In 

addition, with the issuance of DOE’s test 

procedure in 2016, manufacturers must, 

pursuant to EPCA (42 U.S.C. 6293(c)), 

disclose the DOE results in any energy 

representations they make. Thus, 

according to the Joint Commenters, 

manufacturers ‘‘have had more than 

three years to gain familiarity with the 

test procedures and to understand how 

different basic models perform under 

test.’’ The CA IOUs also noted 

manufacturers are currently reporting 

their models’ efficiency ratings to the 

California state database. ASAP et al. 

agreed FTC should require labeling 

sooner, stating: ‘‘[l]abeling in advance of 

the compliance date of the DOE 

standards will provide consumers with 

information to compare portable AC 

units as well as an indication that 

portable ACs are less efficient than room 

ACs.’’ 

B. Energy Efficiency Descriptor 

Transition 

AHRI, Goodman, and the CA–IOUs 

generally supported the proposal to 

update the efficiency descriptors on the 

label. No commenter opposed the 

proposal. However, AHRI and Goodman 

urged the Commission to issue these 

updates as part of a broader overhaul to 

the Rule, which, as discussed in section 

V.C., would involve a transition from 

physical labels on individual units to 

online labels accessed through websites 

or QR codes. 

These commenters also discussed the 

importance of updating the efficiency 

descriptors. In preparation for the DOE 

change, AHRI’s members are designing, 

testing, certifying, and introducing new 

equipment. They are also educating 

industry members and consumers by 

modifying AHRI’s product directory and 

certification program. AHRI expects 

manufacturers to release products with 

updated efficiency descriptors prior to 

the 2023 compliance deadline. DOE has 

issued guidance allowing early 

compliance with the test procedures, as 

long as the represented efficiencies 

comply with the 2023 minimum 

requirements. Given this timing, AHRI 

urged the Commission to complete label 

updates by summer 2021, so 

manufacturers may release compliant 

products as early as January 2022. In 

contrast, Goodman urged the 

Commission to issue the updates earlier, 

by December 2020, to give 

manufacturers even more time. 

To minimize market confusion from 

such early compliance, AHRI is 

developing a communications campaign 

‘‘to inform distributors, contractors, 

regulators, and building inspectors 

about the transition.’’ AHRI did not offer 

any specific proposals for addressing 

the transition on the physical label 

itself. It also opposed any FTC mandate 

for two separate labels requiring 

disclosures of the old and new metrics. 

Instead, it recommended a transition to 

an ‘‘electronic label’’ beginning in 2023 

as discussed further below. Prior to that 

date, under AHRI’s proposal, 

manufacturers choosing to display the 

new efficiency descriptor earlier would 

use the physical EnergyGuide label 

along with a smaller label containing 

regional installation information, as 

well as a QR (or equivalent) link to an 

updated FTC electronic label. 

Finally, on a separate issue involving 

central air conditioners, Goodman 

suggested the Commission modify range 

information for split-systems to revert to 

a format that appeared on labels prior to 

2016. In its view, the current label, 

which limits the efficiency ratings to a 

single value, leads to consumer 

confusion because the actual efficiency 

rating for a system depends on the 

combination of the outdoor condenser 

and indoor unit. 

C. Label Burdens 

Commenters offered a variety of views 

regarding the Rule’s approach to 

labeling. First, the Joint Commenters, 

the CA IOUs, and Goodman offered 

differing views on whether the Rule’s 

labeling requirements are 

‘‘unnecessarily prescriptive.’’ Second, as 

discussed in section D, both AHAM and 

AHRI recommended the Commission 

completely revise the Rule to transition 

to online or virtual energy labels. 

The Joint Commenters and the CA 

IOUs rejected the notion that the Rule’s 

requirements for label layout, type style 

and setting, and label adhesion are too 

prescriptive. In the CA IOUs’ view, 

increased flexibility in the labeling 

requirements ‘‘could result in poor or 

inconsistent label quality that could 

inhibit consumers from making 

informed decisions regarding product 

performance.’’ Further, they asserted 

that uniform presentation facilitates 

effective ‘‘information delivery’’ and 

avoids ‘‘unnecessary confusion.’’ The 

CA IOUs further suggested the labels 

would better serve consumers if they 

appeared on both packages and the 

products themselves. Similarly, the 

Joint Commenters described the label 

specifications as ‘‘vital to the success of 

this program’’ and contended the 

questions in the NPRM ignore the 

‘‘unique context and history of the 

EnergyGuide label program.’’ In their 

view, because the EnergyGuide label has 

more information (e.g., operating costs, 

efficiency ratings, comparative range 

bars, key product features, and 

explanatory statements) than many 

other required disclosures in other 

programs (e.g., labels for textiles and 

leather goods), the energy labels require 

a format ‘‘highly standardized to ease 

comparisons.’’ In addition, they argued 

allowing variability in layout and type 

style would hinder the label’s 

effectiveness in assisting consumers 

with their purchasing decisions. 

Finally, the Joint Commenters 

asserted the NPRM’s questions 

regarding label flexibility ‘‘exhibits 

amnesia as to the widespread 

noncompliance that the inadequate 

specificity in [the FTC’s] prior 

regulations had fostered.’’ The 

commenters cited past store visits 

demonstrating ‘‘the use of adhesives 

varied widely and that certain 

approaches were associated with higher 

rates of missing or detached labels.’’ The 

Joint Commenters noted that, in 

response to these findings, FTC added 

‘‘specificity to its regulations governing 

adhesives.’’ In their view, reducing this 

specificity would ‘‘only encourage a 

return to labelling practices that deprive 

consumers of access to the important 

information that EnergyGuide labels 

provide.’’ 

In contrast, Goodman, a heating and 

cooling equipment manufacturer, 

offered several detailed suggestions to 

eliminate specific labeling requirements 

in § 305.20. It argued that these changes 

9278 Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Rules and Regulations 

would simplify the Rule and free 

‘‘businesses from unnecessarily 

prescriptive requirements.’’ Specifically, 

Goodman recommended the Rule 

specify only minimum dimensions 

instead of the current range of widths 

and lengths and include only whole 

number minimums (e.g., 7 inches for the 

length as opposed to 73⁄8 inches). It also 

suggested removal of requirements 

related to picas for copy set, the 

centering of text, and type style and 

setting, which includes requirements for 

a uniform font type. Goodman also 

recommended elimination of the 

existing paper stock requirement (‘‘58 

pounds per 500 sheets or equivalent’’) 

and minimum peel adhesion capacity 

(‘‘12 ounces per square inch’’). Finally, 

it claimed the suggested minimum peel 

adhesion capacity in § 305.20(d) ‘‘is 

typically taken to be’’ a requirement 

despite the Rule’s language to the 

contrary. 

D. Transition to Electronic Labeling 

Three commenters discussed issues 

beyond whether the Rule’s specific label 

requirements should be less 

prescriptive. Specifically, AHAM, 

AHRI, and Goodman urged the 

Commission to consider ‘‘whether 

physical labels continue to provide 

value to consumers.’’ AHAM, whose 

members manufacture large household 

appliances, such as refrigerators and 

dishwashers, argued the ‘‘showroom 

focus’’ of the label is outdated and 

recommended a ‘‘transition away from 

physical labels’’ and a shift to a program 

providing label content solely online. In 

addition to helping manufacturers by 

significantly reducing compliance costs, 

AHAM argued such an approach would 

help consumers by reflecting evolving 

shopping patterns. According to AHAM, 

the majority of consumers research 

appliances online before entering a store 

or purchasing from a website. Moreover, 

energy efficiency is not a primary factor 

in consumers’ appliance purchases. 

Instead, according to AHAM, consumers 

focus on other factors, primarily 

purchase ‘‘cost.’’ Should the FTC retain 

requirements for a physical label, 

AHAM recommended more flexible 

requirements, but also urged the 

Commission to retain the existing label 

specifications as a safe harbor. 

According to AHAM, companies have 

invested time and resources in 

developing labels compliant with the 

existing requirements. A safe harbor 

would allow them to benefit from these 

investments and provide more certainty 

even if the Commission shifts to less 

detailed regulations. 

In AHAM’s view, conditions have 

changed even in the last decade, and 

significant opportunities exist to permit 

‘‘the electronic delivery of label 

information.’’ It noted the Commission 

has already laid the groundwork for 

such a shift by requiring manufacturers 

to provide electronic access to label 

content (e.g., § 305.9 (online availability 

of labels) and § 305.11 (submission of 

website address for online labels)). With 

these regulatory requirements in place, 

AHAM predicted a transition to 

electronic labels would involve a ‘‘small 

step’’ that would ‘‘dramatically reduce 

regulatory burden and cost’’ and 

eliminate the redundancy of requiring 

labels in both digital and paper format. 

AHAM asserted such a change would 

allow consumers ‘‘to access the content 

in the form and manner that best suits 

them’’ and allow them to ‘‘readily 

access the content wherever they may 

be researching their purchase.’’ It also 

suggested such a shift would allow 

retailers to access labels from the DOE 

Compliance Certification Management 

System (CCMS) and provide flexibility 

to ‘‘present the label content through 

printouts, electronic displays, or other 

means’’ suitable to consumer needs. In 

addition, an online format would allow 

manufacturers to more easily update 

labels and make corrections to online 

content. Finally, AHAM urged the 

Commission to coordinate such efforts 

with Canada to ‘‘align data elements, 

reporting and content.’’ 

AHRI and Goodman offered similar 

suggestions but focused their comments 

on specific aspects of heating and 

cooling equipment. AHRI noted the FTC 

has the discretion under EPCA (42 

U.S.C. 6294(a)) to discontinue the use of 

EnergyGuide labels for central air 

conditioners and heat pumps if it 

determines the label does not assist 

consumers in making purchasing 

decisions. It agreed with AHAM that the 

FTC has ‘‘already taken the most 

dramatic step forward in the virtual 

revolution by requiring all 

manufacturers to have a pdf or link 

version of its FTC label available 

online.’’ Nevertheless, according to 

AHRI, the label’s small value for heating 

and cooling equipment renders its 

administrative burden ‘‘outsized.’’ 

However, as discussed below, AHRI did 

not recommend the ‘‘wholesale 

retirement of EnergyGuide labels,’’ but 

rather a ‘‘modernization’’ using QR 

codes and electronic labels to inform 

consumers without requiring 

‘‘anachronistic prescriptive stickers.’’ 

In discussing the Rule’s current 

approach, AHRI argued the label on 

central air conditioners does not help 

consumers with their purchasing 

decisions because consumers generally 

do not buy these products ‘‘off-theshelf’’ in retail stores and, for new home 

purchases, a builder (not the consumer) 

typically chooses equipment. In 

addition, contractors usually sell 

replacement products in the consumer’s 

home, often in urgent situations. In such 

transactions, contractors usually 

provide homeowners with information 

about their products using the 

‘‘manufacturer’s literature, the AHRI 

Directory of Certified Product 

Performance, energy code requirements, 

incentive programs, and specific design 

features.’’ AHRI also argued, given the 

many different efficiency ratings of 

various outdoor-indoor unit 

combinations, ‘‘the actual value of the 

physical label is questionable at best.’’ 

Accordingly, not only are consumers 

unlikely to view the label prior to 

purchase, information provided directly 

by the contractor, including efficiency 

ratings for various unit combinations, is 

‘‘significantly more accurate.’’ 

In lieu of the current labeling 

approach, AHRI recommended a 

modified, smaller label giving both 

electronic access to consumer 

information online (e.g., through a QR 

code), as well as regional standards 

compliance statements in ‘‘clear text.’’ 

In AHRI’s view, this approach would 

bring ‘‘the cost-benefit equation’’ of the 

labeling program ‘‘into balance.’’ It 

would also allow consumers to learn 

about the product’s efficiency, while 

dramatically reducing the burden 

associated with affixing labels to the 

equipment. 

V. Final Amendments 

The Commission issues the final 

amendments as proposed, with 

modifications discussed below. The 

amendments finalize the labeling 

requirements for portable air 

conditioners with a compliance date 

coinciding with the DOE standards. 

Additionally, the amendments contain 

the proposed changes to the efficiency 

descriptors on central air conditioner 

labels. The Commission, however, 

declines to propose additional wideranging changes (e.g., a transition to 

electronic labeling) to the EnergyGuide 

program at this time. Instead, the 

Commission may seek further comment 

on these issues, including the 

elimination of physical labels, in a 

future proceeding, where the 

Commission could gather the evidence 

necessary to fully consider significant 

amendments to the entire Rule. 

A. Portable Air Conditioner Labels 

As proposed in the NPRM and 

supported by commenters, the 

Commission adopts the proposed 

amendments containing new labeling 

Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Rules and Regulations 9279 

21 80 FR at 67357–58. 22See 80 FR at 67357 and 81 FR at 62683. 23Specifically, manufacturers must include the 

new label on all units produced on or after that 

date. 24 83 FR 7593, 7594 (Feb. 22, 2018). 25 80 FR 67285, 67293 (Nov. 2, 2015). 

26The final amendments also contain minor 

changes in section 305.27 (Paper Catalogs and 

websites) to include references to portable air 

conditioners. 

27As with the room air conditioner labels, the 

portable air conditioner labels include the operating 

assumptions behind the energy cost estimates. In 

addition, the amendments do not contain 

requirements related to the need for ducting. 

Manufacturers have an incentive to ensure 

consumers understand how to operate their 

products properly and should not need a mandate 

from the FTC to do so. However, should problems 

arise in the marketplace, the Commission may 

reconsider such requirements in the future. 

rules for portable air conditioners. As 

detailed in this and previous notices, 

these products are common in the 

marketplace, vary in energy efficiency, 

and use energy similar to, or greater 

than, currently labeled room air 

conditioners.21 Further, energy labels 

for these products are likely to assist 

consumers with purchasing decisions 

by allowing them to compare the energy 

costs of competing models and, 

consequently, save significantly on their 

electric bills. In addition, there is no 

evidence labeling is economically or 

technologically infeasible (i.e., that the 

costs of labeling substantially outweigh 

consumer benefits).22

After considering the comments, the 

Commission adjusts the compliance 

date to October 1, 2022.23 As some 

commenters noted, manufacturers have 

sufficient information to create labels 

because, pursuant to 42 U.S.C. 6293(c), 

they have been testing their products 

since 2016 using the DOE procedure to 

substantiate any energy-related claims 

(including unit capacity) for all their 

models. Therefore, the proposed 2025 

compliance date appears to be overly 

long, particularly given the expected 

consumer benefits from labeling very 

low efficiency units prior to the DOE 

standards. The Commission, however, 

understands such packaging changes 

can take time, particularly where 

manufacturers must redesign their box 

labels to accommodate the EnergyGuide. 

Accordingly, the final amendments 

establish an October 2022 compliance 

date to provide companies ample time 

to incorporate the label into packaging 

while getting these labels into the 

market sooner than originally proposed. 

As the Commission has noted in the 

past, manufacturers generally deploy 

their lines for these types of products on 

an annual basis beginning in October of 

each year.24 The final compliance date, 

which coincides with the beginning of 

the model year, will allow 

manufacturers to incorporate the 

changes into their normal production 

schedules with minimal disruption. In 

addition, the Rule allows manufacturers 

to incorporate the label into the primary 

packaging display or affix them to label 

packaging (relieving them from 

redesigning boxes for models scheduled 

to be phased out before the 2025 

standards).25

The final amendments also contain 

several other minor changes for the 

portable air conditioner labels in 

response to comments.26 First, the final 

Rule requires manufacturers to 

determine model capacity using the 

DOE testing requirements specifically 

applicable to portable air conditioners. 

Second, the final amendments contain a 

small change to the language in 

§ 305.18(a)(9) to clarify that the 

comparative information on the portable 

air conditioners applies to models of 

similar capacity only (without the 

various configurations applicable to 

room air conditioners).27

B. Energy Efficiency Descriptor 

Transition 

The final Rule adopts the proposed 

amendments to require manufacturers to 

update the efficiency descriptors for 

central air conditioners to conform to 

pending DOE changes. The change for 

all applicable references in Part 305 will 

become effective on January 1, 2023 to 

ensure consistency with the new DOE 

requirements. To aid the transition, 

manufacturers may begin using the new 

information prior to January 1, 2023 in 

a manner consistent with DOE 

guidance. Given the relatively small 

differences produced by the old and the 

new rating methods, the amendments 

do not require dual labels or any 

additional explanatory information. As 

indicated in its comments, AHRI is 

developing a communications campaign 

to help various entities with the 

transition to the new descriptors. In 

addition, as part of the scheduled 2022 

update to comparability ranges for all 

product classes (§ 305.12), the 

Commission will update ranges in 

Appendix H and I, as well as applicable 

numbers and terms on the sample labels 

in Appendix L. 

C. Label Burdens and Electronic 

Labeling 

The final amendments do not make 

any broad changes to the Rule, although 

commenters recommended a wide array 

of potential changes. For instance, both 

AHRI and AHAM recommended a 

transition away from the current 

physical label to a system that relies on 

electronic web-based labels or energy 

data to aid consumer purchasing 

decisions. Although these proposals 

warrant further exploration, such broad 

issues would require additional rounds 

of notice and comment to consider and 

develop. Accordingly, the Commission 

may consider those proposals during a 

future proceeding to avoid delay in 

promulgating the present amendments 

for portable air conditioner labels and 

update to efficiency descriptors for 

central air conditioners. 

These broad industry suggestions are 

part of a larger inquiry about the Rule’s 

future, particularly as online 

information continues to become more 

prevalent and consumer shopping 

habits change. EPCA’s basic labeling 

provisions, developed in the 1970’s, are 

predicated upon an understanding that 

consumers routinely examine and 

purchase products in retail showrooms 

with little prior information. Further, to 

ensure any covered product displayed 

in a showroom bears a label, the Rule 

requires manufacturers to affix the label 

on every unit it produces, apparently 

based on the expectation that any unit 

may be displayed in a store. 

Over the years, however, buying 

patterns have changed. Consumers now 

frequently compare and purchase 

products without ever visiting a store. 

To help consumers in this evolving 

marketplace, the Commission’s 

revisions in the last several years reflect 

these new buying patterns. Specifically, 

the FTC previously updated the Rule 

with clear requirements that retailers 

display labels on websites (§ 305.27), for 

manufacturers to make their labels 

accessible online (§ 305.9), and for 

manufacturers to submit links to those 

labels as part of their routine data 

reports filed through DOE’s CCMS 

(§ 305.11). 

Further amendments may reduce 

burdens while ensuring energy 

information is available to consumers. 

For instance, the Commission could 

examine whether the Rule should 

continue to require manufacturers to 

affix a display-ready EnergyGuide label 

on every appliance typically displayed 

in showrooms. Indeed, only a tiny 

fraction of units shipped actually appear 

in retail store displays, while the costs 

of affixing display-ready labels to all 

units can impose significant burden. On 

the other hand, past commenters have 

noted that consumers use the label 

affixed to their old product in choosing 

a new one. 

In addition, the Commission could 

consider changes to the label content to 

help consumers better compare 

products and understand issues not 

currently communicated by the label, 

such as climate change impacts, Smart 

9280 Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Rules and Regulations 

28 44 U.S.C. 3501 et seq.; see also 5 CFR 1320.3(c). 

29 In earlier comments, AHAM (#681–00012) 

estimated the data entry involved in filing reports 

with the FTC is not particularly burdensome, but 

estimated that other tasks involved in reporting 

(such as performing the required testing and 

gathering information) could take as long as 40 

hours per manufacturer. As noted above, however, 

testing and reporting are required and accounted for 

in DOE regulations. As a result, staff estimates that 

the primary burdens associated with reporting are 

due to DOE requirements. 

30These labor cost estimates are derived from the 

Bureau of Labor Statistics figures in ‘‘Table 1.’’ 

National employment and wage data from the 

Occupational Employment Statistics survey by 

occupation, May 2018,’’ available at: https://

www.bls.gov/news.release/ocwage.t01.htm. 

31 Id. 

32AHAM estimated manufacturers would require 

32 hours per model for testing and up to 4 hours 

for preparing the test data. AHAM Comment, #681– 

0016. 

Grid technologies, and better ways to 

display comparative energy cost 

information. However, without further 

commenter input, we do not know how 

valuable this information would be for 

consumers, and how easy it would be to 

convey such information with existing 

DOE-generated data. 

These issues represent a few of many 

possible issues the Commission could 

consider in a future proceeding. In 

weighing any alternatives to the Rule, 

the Commission would need to ensure 

any new approach is consistent with its 

existing authority under EPCA. The 

Commission must also ensure 

consumers have access to clear, truthful 

energy information to assist them in 

their purchasing decisions while 

minimizing burdens placed on industry 

members. Fully evaluating these issues 

requires a more extensive proceeding 

focused from the outset at broad issues 

affecting the Rule in the 21st century. 

The Commission also declines to 

propose amendments to eliminate the 

current physical labels for central air 

conditioners and replace them with a 

smaller label with a QR code (or its 

equivalent) linking consumers to online 

content as AHRI and Goodman 

recommended. Such substantial changes 

to the labeling program would require 

further study and consideration in a 

future rulemaking proceeding. In the 

meantime, the updated EnergyGuide 

label for central air conditioners, which 

contains both EPCA-mandated energy 

efficiency ratings and regional standards 

information for installers, will continue 

to aid both consumers and industry 

members. 

Finally, the Commission may 

consider changes to the detailed label 

requirements (e.g., the changes to 

current label layout and content 

advocated by Goodman) in a future 

proceeding. Some of the Rule’s detailed 

requirements mentioned in the NPRM 

may have indeed become obsolete. At 

the same time, detailed, uniform 

requirements for consumer labels like 

the EnergyGuide provide benefits to 

consumers by presenting information in 

a format that allows consumers to easily 

compare products across multiple 

categories. Moreover, the FTC’s online, 

editable EnergyGuide templates already 

include all the label’s general 

information in the size, font, and 

location required by the Rule and thus 

largely free manufacturers from having 

to navigate the detailed format 

requirements. 

VI. Paperwork Reduction Act 

The current Rule contains 

recordkeeping, disclosure, testing, and 

reporting requirements that constitute 

information collection requirements as 

defined by the Paperwork Reduction 

Act (‘‘PRA’’).28 Under the PRA, an 

agency may not collect or sponsor the 

collection of information, nor may it 

impose an information collection 

requirement, unless it displays a 

currently valid Office of Management 

and Budget (‘‘OMB’’) control number. 

OMB has approved the Rule’s existing 

information collection requirements 

through December 31, 2022 (OMB 

Control No. 3084–0069). 

The amendments include new 

labeling requirements for portable air 

conditioners that constitute information 

collections under the PRA. The 

Commission submitted these proposed 

information collections for review by 

OMB in conjunction with its 

publication of the NPRM. The 

Commission received no comments 

pertaining to its PRA estimates. OMB 

has approved these amended 

information collection requirements 

under the existing control number for 

the Rule (3084–0069). 

Burden estimates below are based on 

Census data, DOE figures and estimates, 

public comments, general knowledge of 

manufacturing practices, and trade 

association advice and figures. The FTC 

estimates there are about 150 basic 

models of portable air conditioners (i.e., 

units with essentially identical physical 

and electrical characteristics). In 

addition, FTC staff estimates there are 

45 portable air conditioner 

manufacturers and 1,500,000 portable 

air conditioner units shipped each year 

in the U.S. 

Reporting: The Rule requires 

manufacturers of covered products to 

annually submit a report for each model 

in current production containing the 

same information that must be 

submitted to the Department of Energy 

pursuant to 10 CFR part 429. In lieu of 

submitting the required information to 

the Commission, manufacturers may 

submit such information to DOE 

directly via the agency’s Compliance 

Certification Management System, 

available at https://regulations.doe.gov/ 

ccms, as provided by 10 CFR 429.12. 

Because manufacturers are already 

required to submit these reports to DOE, 

FTC staff estimates any additional 

burden associated with providing the 

information to the FTC is minimal. FTC 

staff estimates the average reporting 

burden for manufacturers of portable air 

conditioners will be approximately 15 

hours per manufacturer. Based on this 

estimate, the annual reporting burden 

for manufacturers of portable air 

conditioners is 675 hours (15 hours × 45 

manufacturers).29 Staff estimates that 

information processing staff, at an 

hourly rate of $16.24,30 will typically 

perform the required tasks, for an 

estimated annual labor cost of $10,962. 

Labeling: The amendments require 

that manufacturers label portable air 

conditioners. The burden imposed by 

this requirement consists of the time 

needed to draft labels and incorporate 

them onto package designs. Since EPCA 

and the Rule specify the content and 

format for the required labels and FTC 

staff provide online label templates, 

manufacturers need only input the 

energy consumption figures and other 

product-specific information derived 

from testing. FTC staff estimates the 

time to incorporate the required 

information into labels and label 

covered products is five hours per basic 

model. Accordingly, staff estimates that 

the approximate annual burden 

involved in labeling covered products is 

750 hours [150 basic models × 5 hours]. 

Staff estimates that information 

processing staff, at an hourly rate of 

$16.24,31 will typically perform the 

required tasks, for an estimated annual 

labor cost of $12,180. 

Testing: Manufacturers of portable air 

conditioners must test each basic model 

they produce to determine energy usage, 

but the majority of tests conducted are 

required by DOE rules. As a result, it is 

likely only a small portion of the tests 

conducted are attributable to the Rule’s 

requirements. In addition, 

manufacturers need not subject each 

basic model to testing annually; they 

must retest only if the product design 

changes in such a way as to affect 

energy consumption. FTC staff estimates 

manufacturers will require 

approximately 36 hours for testing of 

portable air conditioners,32 and that 

25% of all basic models are tested 

annually due to the Rule’s requirements. 

Accordingly, the estimated annual 

testing burden for portable air 

Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Rules and Regulations 9281 

33See supra note 20. 

34 Id. 

35 Id. 

conditioners is 1,368 hours ((150 basic 

models × 25%) × 36 hours). Staff 

estimates that engineering technicians, 

at an hourly rate of $28.37,33 will 

typically perform the required tasks, for 

an estimated annual labor cost of 

$38,300. 

Recordkeeping: The Rule also requires 

manufacturers of covered products to 

retain records of test data generated in 

performing the tests to derive 

information included on labels. See 16 

CFR 305.21. The FTC estimates the 

annual recordkeeping burden for 

manufacturers of portable air 

conditioners will be approximately one 

minute per basic model to store relevant 

data. Accordingly, the estimated annual 

recordkeeping burden would be 

approximately 3 hours (150 basic 

models × one minute). Staff estimates 

that information processing staff, at an 

hourly rate of $16.24,34 will typically 

perform the required tasks, for an 

estimated annual labor cost of $50. 

Online and Retail Catalog 

Disclosures: Staff estimates there are 

approximately 400 sellers of products 

covered under the Rule who are subject 

to the Rule’s catalog disclosure 

requirements. Staff has previously 

estimated covered online and catalog 

sellers spend approximately 17 hours 

per year to incorporate relevant product 

data for products that are currently 

covered by the Rule. Staff estimates the 

portable air conditioner requirements 

will add one additional hour per year in 

incremental burden per seller. Staff 

estimates these additions will result in 

an incremental burden of 400 hours 

(400 sellers × one hour annually). Staff 

estimates that information processing 

staff, at an hourly rate of $16.24,35 will 

typically perform the required tasks, for 

an estimated incremental annual labor 

cost of $6,496. 

Estimated annual non-labor cost 

burden: Staff anticipates that 

manufacturers are not likely to require 

any significant capital costs to comply 

with the amendments. 

VII. Regulatory Flexibility Act 

The Regulatory Flexibility Act (RFA), 

5 U.S.C. 601 through 612, requires the 

Commission provide an Initial 

Regulatory Flexibility Analysis (IRFA) 

with a proposed rule and a Final 

Regulatory Flexibility Analysis (FRFA), 

with the final rule, if any, unless the 

Commission certifies that the rule will 

not have a significant economic impact 

on a substantial number of small 

entities. See 5 U.S.C. 603 through 605. 

The Commission does not anticipate 

that the amendments will have a 

significant economic impact on a 

substantial number of small entities. 

The Commission recognizes that some 

of the affected manufacturers may 

qualify as small businesses under the 

relevant thresholds. The Commission 

estimates that the amendments will 

apply to 300 online and paper catalog 

sellers of covered products and about 45 

portable air conditioner manufacturers. 

The Commission expects that 

approximately 150 of these various 

entities qualify as small businesses. 

Although the Commission has 

certified under the RFA that the 

amendments would not have a 

significant impact on a substantial 

number of small entities, the 

Commission has determined, 

nonetheless, that it is appropriate to 

publish an FRFA in order to explain the 

impact of the amendments on small 

entities as follows: 

A. Description of the Reasons That 

Action by the Agency Is Being Taken 

Based upon the record, including 

public comments, the Commission is 

amending the Rule to expand product 

coverage and make additional 

improvements to the Rule to help 

consumers in their purchasing decisions 

for portable air conditioners. 

B. Issues Raised by Comments in 

Response to the IRFA 

The Commission did not receive any 

comments specifically related to the 

impact of the final amendments on 

small businesses. In addition, the Chief 

Counsel for Advocacy of the Small 

Business Administration did not submit 

comments. 

C. Estimate of Number of Small Entities 

to Which the Amendments Will Apply 

Under the Small Business Size 

Standards issued by the Small Business 

Administration, appliance 

manufacturers qualify as small 

businesses if they have fewer than 500 

employees. Catalog sellers qualify as 

small businesses if their sales are less 

than $8.0 million annually. The 

Commission estimates that there are 

approximately 150 entities subject to the 

final amendments that qualify as small 

businesses. The Commission estimates 

that the amendments will not have a 

significant impact on small businesses. 

D. Projected Reporting, Recordkeeping, 

and Other Compliance Requirements 

The amendments will slightly 

increase reporting, recordkeeping, and 

disclosure requirements associated with 

the Commission’s labeling rules as 

discussed above. The amendments 

likely will increase compliance burdens 

by extending the labeling requirements 

to portable air conditioners. The 

Commission anticipates that the label 

design change will be implemented by 

graphic designers. 

E. Description of Steps Taken To 

Minimize Significant Economic Impact, 

if Any, on Small Entities, Including 

Alternatives 

The Commission sought comment and 

information on the need, if any, for 

alternative compliance methods that 

would reduce the economic impact of 

the Rule on such small entities. To 

allow time for industry to come into 

compliance with the revised Rule and 

minimize the impact of the amendments 

on covered entities, the Commission has 

given manufacturers until October 1, 

2022 to implement portable air 

conditioner labels. The Commission 

may consider other proposals related to 

electronic labeling and additional issues 

in a future proceeding. 

VIII. Other Matters 

Pursuant to the Congressional Review 

Act (5 U.S.C. 801 et seq.), the Office of 

Information and Regulatory Affairs 

designated this rule as not a ‘‘major 

rule,’’ as defined by 5 U.S.C. 804(2). 

Final Rule Language 

List of Subjects in 16 CFR Part 305 

Advertising, Energy conservation, 

Household appliances, Labeling, 

Reporting and recordkeeping 

requirements. 

For the reasons stated above, the 

Commission amends part 305 of title 16 

of the Code of Federal Regulations as 

follows: 

PART 305—ENERGY AND WATER USE 

LABELING FOR CONSUMER 

PRODUCTS UNDER THE ENERGY 

POLICY AND CONSERVATION ACT 

(‘‘ENERGY LABELING RULE’’) 

■ 1. The authority citation for part 305 

continues to read as follows: 

Authority: 42 U.S.C. 6294. 

■ 2. In part 305, effective January 1, 

2023: 

■ a. Revise all references to ‘‘seasonal 

energy efficiency ratio (SEER)’’ to read 

‘‘seasonal energy efficiency ratio 2 

(SEER2)’’; 

■ b. Revise all references to ‘‘SEER’’ to 

read ‘‘SEER2’’; 

■ c. Revise all references to ‘‘heating 

seasonal performance factor’’ to read 

‘‘heating seasonal performance factor 

2’’; 

9282 Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Rules and Regulations 

■ d. Revise all references to ‘‘HSPF’’ to 

read ‘‘HSPF2’’; 

■ e. Revise all references to ‘‘Energy 

Efficiency Ratio’’ to read ‘‘Energy 

Efficiency Ratio 2’’; and 

■ f. Revise all references to ‘‘EER’’ to 

read ‘‘EER2.’’ 

■ 3. In § 305.2, effective October 1, 

2022, redesignate paragraph (l)(23) as 

(l)(24) and add new paragraph (l)(23) to 

read as follows: 

§ 305.2 Definitions. 

* * * * * 

(l) * * * 

(23) Portable air conditioners. 

* * * * * 

■ 4. In § 305.2, effective January 1, 2023, 

revise paragraph (p) to read as follows: 

§ 305.2 Definitions. 

* * * * * 

(p) Energy efficiency rating means the 

following product-specific energy usage 

descriptors: Annual fuel utilization 

efficiency (AFUE) for furnaces; 

combined energy efficiency ratio (CEER) 

for room and portable air conditioners; 

seasonal energy efficiency ratio 2 

(SEER2) for the cooling function of 

central air conditioners and heat pumps; 

heating seasonal performance factor 2 

(HSPF2) for the heating function of heat 

pumps; airflow efficiency for ceiling 

fans; and, thermal efficiency (TE) for 

pool heaters, as these descriptors are 

determined in accordance with tests 

prescribed under section 323 of the Act 

(42 U.S.C. 6293). These product-specific 

energy usage descriptors shall be used 

in satisfying all the requirements of this 

part. 

* * * * * 

■ 5. In § 305.3, effective October 1, 

2022, add paragraph (j) to read as 

follows: 

§ 305.3 Description of appliances and 

consumer electronics. 

* * * * * 

(j) Portable air conditioner means a 

portable encased assembly, other than a 

packaged terminal air conditioner, room 

air conditioner, or dehumidifier, that 

delivers cooled, conditioned air to an 

enclosed space, and is powered by 

single-phase electric current. It includes 

a source of refrigeration and may 

include additional means for air 

circulation and heating. 

■ 6. In § 305.7, effective October 1, 

2022, add paragraph (e)(3) to read as 

follows: 

§ 305.7 Prohibited acts. 

* * * * * 

(e) * * * 

(3) The requirements of this part shall 

not apply to any portable air conditioner 

produced before October 1, 2022. 

* * * * * 

■ 7. In § 305.10, effective October 1, 

2022, revise paragraph (f) to read as 

follows: 

§ 305.10 Determinations of capacity. 

* * * * * 

(f) Room air conditioners and portable 

air conditioners. The capacity for room 

air conditioners shall be the cooling 

capacity in Btu per hour, as determined 

according to appendix F to 10 CFR part 

430, subpart B, but rounded to the 

nearest value ending in hundreds that 

will satisfy the relationship that the 

energy efficiency value used in 

representations equals the rounded 

value of capacity divided by the value 

of input power in watts. If a value 

ending in hundreds will not satisfy this 

relationship, the capacity may be 

rounded to the nearest value ending in 

50 that will. The capacity for portable 

air conditioners shall be determined 

according to appendix CC to 10 CFR 

part 430, subpart B, with rounding 

determined in accordance with 10 CFR 

part 430. 

* * * * * 

■ 8. In § 305.11, effective October 1, 

2022, revise paragraph (b)(1) to read as 

follows: 

§ 305.11 Submission of data. 

* * * * * 

(b)(1) All data required by paragraph 

(a) of this section except serial numbers 

shall be submitted to the Commission 

annually, on or before the following 

dates: 

TABLE 1 TO § 305.11(b)(1) 

Product category 

Deadline 

for data 

submission 

Refrigerators ............................. Aug. 1. 

Refrigerators-freezers ............... Aug. 1. 

Freezers .................................... Aug. 1. 

Central air conditioners ............ July 1. 

Heat pumps .............................. July 1. 

Dishwashers ............................. June 1. 

Water heaters ........................... May 1. 

Room air conditioners .............. July 1. 

Portable air conditioners ........... Feb. 1. 

Furnaces ................................... May 1. 

Pool heaters ............................. May 1. 

Clothes washers ....................... Oct. 1. 

Fluorescent lamp ballasts ......... Mar. 1. 

Showerheads ............................ Mar. 1. 

Faucets ..................................... Mar. 1. 

Water closets ............................ Mar. 1. 

Ceiling fans ............................... Mar. 1. 

Urinals ....................................... Mar. 1. 

Metal halide lamp fixtures ........ Sept. 1. 

General service fluorescent 

lamps ..................................... Mar. 1. 

TABLE 1 TO § 305.11(b)(1)— 

Continued 

Product category 

Deadline 

for data 

submission 

Medium base compact fluorescent lamps ............................. Mar. 1. 

General service incandescent 

lamps ..................................... Mar. 1. 

Televisions ................................ June 1. 

* * * * * 

■ 9. In § 305.13, effective October 1, 

2022, revise the section heading and 

paragraph (e)(3) to read as follows: 

§ 305.13 Layout, format, and placement of 

labels for refrigerators, refrigeratorfreezers, freezers, dishwashers, clothes 

washers, water heaters, room air 

conditioners, portable air conditioners, and 

pool heaters. 

* * * * * 

(e) * * * 

(3) Package labels for certain 

products. Labels for electric 

instantaneous water heaters shall be 

printed on or affixed to the product’s 

packaging in a conspicuous location. 

Labels for room air conditioners 

produced on or after October 1, 2019 

and portable air conditioners, shall be 

printed on or affixed to the principal 

display panel of the product’s 

packaging. The labels for electric 

instantaneous water heaters, room air 

conditioners, and portable air 

conditioners shall be black type and 

graphics on a process yellow or other 

neutral contrasting background. 

* * * * * 

■ 10. In § 305.18, effective October 1, 

2022, revise the section heading and 

paragraph (a)(9) to read as follows: 

§ 305.18 Label content for room air 

conditioners and portable air conditioners. 

(a) * * * 

(9) Labels must contain a statement as 

illustrated in the prototype labels in 

appendix L of this part and specified as 

follows (fill in the blanks with the 

appropriate model type, year, energy 

type, and energy cost figure): 

Your costs will depend on your utility 

rates and use. 

Cost range based only on models [of 

similar capacity; of similar capacity 

without reverse cycle and with louvered 

sides; of similar capacity without 

reverse cycle and without louvered 

sides; with reverse cycle and with 

louvered sides; or with reverse cycle 

and without louvered sides]. 

Estimated annual energy cost is based 

on a national average electricity cost of 

ll cents per kWh and a seasonal use 

Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Rules and Regulations 9283 

of 8 hours use per day over a 3-month 

period. 

For more information, visit 

www.ftc.gov/energy. 

* * * * * 

■ 11. In § 305.20, effective January 1, 

2023, revise paragraphs (g)(11) through 

(14) to read as follows: 

§ 305.20 Labeling for central air 

conditioners, heat pumps, and furnaces. 

* * * * * 

(g) * * * 

(11) For any single-package air 

conditioner with a minimum Energy 

Efficiency Ratio 2 (EER2) of at least 10.6, 

any split system central air conditioner 

with a rated cooling capacity of at least 

45,000 Btu/h and minimum efficiency 

ratings of at least 13.8 SEER2 and 11.2 

EER2 or at least 15.2 SEER2 and 9.8 

EER2, and any split-system central air 

conditioners with a rated cooling 

capacity less than 45,000 Btu/h and 

minimum efficiency ratings of at least 

14.3 SEER2 and 11.7 EER2 or at least 

15.2 SEER2 and 9.8 EER2, the label 

must contain the following regional 

standards information: 

(i) A statement that reads: 

Notice 

Federal law allows this unit to be 

installed in all U.S. states and 

territories. 

(ii) For split systems, a statement that 

reads: 

Energy Efficiency Ratio 2 (EER2): The 

installed system’s minimum EER2 is 

ll. 

(iii) For single-package air 

conditioners, a statement that reads: 

Energy Efficiency Ratio 2 (EER2): This 

model’s EER2 is [ll]. 

(12) For any split system central air 

conditioner with a rated cooling 

capacity of at least 45,000 Btu/h and 

minimum efficiency ratings of at least 

13.8 SEER2 but lower than 11.2 EER2 or 

at least 15.2 SEER2 but lower than 9.8 

EER2, and any split-system central air 

conditioners with a rated cooling 

capacity less than 45,000 Btu/h and 

minimum efficiency ratings of at least 

14.3 SEER2 but lower than 11.7 EER2 or 

at least 15.2 SEER2 but lower than 9.8 

EER2, the label must contain the 

following regional standards 

information: 

(i) A statement that reads: 

Notice 

Federal law allows this unit to be 

installed only in: AK, AL, AR, CO, CT, 

DC, DE, FL, GA, HI, ID, IL, IA, IN, KS, 

KY, LA, MA, ME, MD, MI, MN, MO, 

MS, MT, NC, ND, NE, NH, NJ, NY, OH, 

OK, OR, PA, RI, SC, SD, TN, TX, UT, 

VA, VT, WA, WV, WI, WY and U.S. 

territories. Federal law prohibits 

installation of this unit in other states. 

(ii) A map appropriate for the model 

and accompanying text as illustrated in 

the sample label 7 in appendix L of this 

part. 

(iii) A statement that reads: 

Energy Efficiency Ratio 2 (EER2): The 

installed system’s minimum EER2 is 

ll. 

(13) For any split system central air 

conditioner with a rated cooling 

capacity of at least 45,000 Btu/h and a 

minimum rated efficiency rating less 

than 13.8 SEER2, and any split-system 

central air conditioners with a rated 

cooling capacity less than 45,000 Btu/h 

and minimum efficiency ratings of less 

than 14.3 SEER2, the label must contain 

the following regional standards 

information: 

(i) A statement that reads: 

Notice 

Federal law allows this unit to be 

installed only in: AK, CO, CT, ID, IL, IA, 

IN, KS, MA, ME, MI, MN, MO, MT, ND, 

NE, NH, NJ, NY, OH, OR, PA, RI, SD, 

UT, VT, WA, WV, WI, and WY. Federal 

law prohibits installation of this unit in 

other states. 

(ii) A map appropriate for the model 

and accompanying text as illustrated in 

the sample label 7 in appendix L of this 

part. 

(iii) A statement that reads: 

Energy Efficiency Ratio 2 (EER2): The 

installed system’s minimum EER2 is 

ll. 

(14) For any single-package air 

conditioner with a minimum EER2 

below 10.6, the label must contain the 

following regional standards 

information: 

(i) A statement that reads: 

Notice 

Federal law allows this unit to be 

installed only in: AK, AL, AR, CO, CT, 

DC, DE, FL, GA, HI, ID, IL, IA, IN, KS, 

KY, LA, MA, ME, MD, MI, MN, MO, 

MS, MT, NC, ND, NE, NH, NJ, NY, OH, 

OK, OR, PA, RI, SC, SD, TN, TX, UT, 

VA, VT, WA, WV, WI, WY and U.S. 

territories. Federal law prohibits 

installation of this unit in other states. 

(ii) A map appropriate for the model 

and accompanying text as illustrated in 

the sample label 7 in appendix L of this 

part. 

* * * * * 

■ 12. In § 305.27, effective October 1, 

2022, revise the section heading and 

paragraphs (a)(1)(i), (b)(1)(i) 

introductory text, and (b)(1)(i)(B) to read 

as follows: 

§ 305.27 Paper catalogs and websites. 

(a) * * * 

(1) * * * 

(i) Products required to bear 

EnergyGuide or Lighting Facts labels. 

All websites advertising covered 

refrigerators, refrigerator-freezers, 

freezers, room air conditioners, portable 

air conditioners, clothes washers, 

dishwashers, ceiling fans, pool heaters, 

central air conditioners, heat pumps, 

furnaces, general service lamps, 

specialty consumer lamps (for products 

offered for sale after May 2, 2018), and 

televisions must display, for each 

model, a recognizable and legible image 

of the label required for that product by 

this part. The website may hyperlink to 

the image of the label using the sample 

EnergyGuide and Lighting Facts icons 

depicted in appendix L of this part. The 

website must hyperlink the image in a 

way that does not require consumers to 

save the hyperlinked image in order to 

view it. 

* * * * * 

(b) * * * 

(1) * * * (i) Products required to bear 

EnergyGuide or Lighting Facts labels. 

All paper catalogs advertising covered 

products required by this part to bear 

EnergyGuide or Lighting Facts labels 

illustrated in appendix L of this part 

(refrigerators, refrigerator-freezers, 

freezers, room air conditioners, portable 

air conditioners, clothes washers, 

dishwashers, ceiling fans, pool heaters, 

central air conditioners, heat pumps, 

furnaces, general service fluorescent 

lamps, general service lamps, and 

televisions) must either display an 

image of the full label prepared in 

accordance with this part, or make a text 

disclosure as follows: 

* * * * * 

(B) Room air conditioners, portable 

air conditioners, and water heaters. The 

capacity of the model determined in 

accordance with this part, the estimated 

annual operating cost determined in 

accordance with this part, and a 

disclosure stating ‘‘Your operating costs 

will depend on your utility rates and 

use. The estimated operating cost is 

based on a [electricity, natural gas, 

propane, or oil] cost of [$ llper kWh, 

therm, or gallon]. For more information, 

visit www.ftc.gov/energy.’’ 

* * * * * 

■ 13. Effective October 1, 2022, 

redesignate appendix E to part 305 as 

appendix E1 and add appendix E2 to 

part 305. 

The addition reads as follows: 

9284 Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Rules and Regulations 

1See Dissenting Statement of Commissioner 

Christine S. Wilson on the Notice of Proposed 

Rulemaking: Energy Labeling Rule (Dec. 10, 2018) 

(expressing my view that the Commission should 

seek comment on the prescriptive labeling 

requirements), https://www.ftc.gov/publicstatements/2018/12/dissenting-statementcommissioner-christine-s-wilson-notice-proposed; 

See Dissenting Statement of Commissioner 

Christine S. Wilson on the Notice of Proposed 

Rulemaking: Energy Labeling Rule (Oct. 22, 2019) 

(urging the Commission to seek comment on the 

labeling requirements), https://www.ftc.gov/system/ 

files/documents/public_statements/1551786/ 

r611004_wilson_dissent_energy_labeling_rule.pdf. 

2See Concurring Statement of Commissioner 

Christine S. Wilson on the Notice of Proposed 

Rulemaking: Energy Labeling Rule (Mar. 20, 2020), 

https://www.ftc.gov/system/files/documents/ 

public_statements/1569815/r611004_wilson_

statement_energy_labeling.pdf. 

3See, e.g., Air-Conditioning, Heating and 

Refrigeration Institute (AHRI) Comment (#33–09), 

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

document?D=FTC-2020-0033-0009; Association of 

Home Appliance Manufacturers (AHAM) Comment 

(#33–04), available at: https://www.regulations.gov/ 

document?D=FTC-2020-0033-0004; Goodman 

Manufacturing Comment (#33–08), available at: 

https://www.regulations.gov/document?D=FTC2020-0033-0008. 

4 Id. 

5See, e.g., Timothy J. Muris, Paper: Will the 

FTC’s Success Continue?, George Mason Law & 

Economics No. 18 (Sept. 24, 2018) (discussing the 

successes and failures of the FTC’s enforcement 

efforts including the aggressive rulemaking 

activities in the 1970s), available at: https://

papers.ssrn.com/sol3/papers.cfm?abstract_

id=3254294; Timothy J. Muris, Rules Without 

Reason, AEI J. on Gov’t and Society (Sept/Oct. 

1982) (describing failed FTC rulemaking 

proceedings), available at: https://www.cato.org/ 

sites/cato.org/files/serials/files/regulation/1982/9/ 

v6n5-4.pdf; Teresa Schwartz, Regulating Unfair 

Practices Under The FTC Act: The Need For a Legal 

Standard of Unfairness, 11 Akron Law Rev. 1 (1978) 

(explaining that the judicial reversals of FTC 

regulations resulted from a failure to establish an 

adequate legal basis for the regulations), available 

at: https://ideaexchange.uakron.edu/ 

akronlawreview/vol11/iss1/1/. 

6See Concurring Statement of Commissioner 

Christine S. Wilson, Amplifier Rule (Dec. 17, 2020), 

https://www.ftc.gov/system/files/documents/ 

public_statements/1585038/csw_amplifier_rule_

stmt_11192020.pdf. 

Appendix E2 to Part 305—Portable Air 

Conditioners 

RANGE INFORMATION

Seasonally adjusted cooling 

capacity range 

(Btu/h) 

Range of 

estimated 

annual energy 

costs 

(dollars/year) 

Low High 

Less than 6,000 Btu .................... $48 $98 

6,000 to 7,999 Btu ...................... 87 120 

8,000 or greater Btu .................... 104 135 

■ 14. Effective October 1, 2022, revise 

appendix K2 to part 305 to read as 

follows: 

Appendix K2 to Part 305— 

Representative Average Unit Energy 

Costs for Dishwasher, Room Air 

Conditioner, Portable Air Conditioner 

Labels 

This Table contains the representative 

unit energy costs that must be utilized 

to calculate estimated annual energy 

cost disclosures required under 

§§ 305.16, 305.18 and 305.27 for 

dishwashers, room air conditioners, and 

portable air conditioners. This Table is 

based on information published by the 

U.S. Department of Energy in 2017. 

Type of energy In commonly used terms 

As required by 

DOE test 

procedure 

Electricity ........................................................................... ¢13.00/kWh1 .................................................................... $.1300/kWh. 

Natural Gas ....................................................................... $1.05/therm 2 or $10.86/MCF 3 ........................................ $0.00001052/Btu. 

No. 2 Heating Oil .............................................................. $2.59/gallon 4 ................................................................... $0.00001883/Btu. 

Propane ............................................................................ $1.53/gallon 5 ................................................................... $0.00001672/Btu. 

Kerosene ........................................................................... $3.01/gallon 6 ................................................................... $0.00002232/Btu. 

1 kWh stands for kilowatt hour. kWh = 3,412 Btu (British thermal units). 

2 therm = 100,000 Btu. 

3 MCF stands for 1,000 cubic feet. For the purposes of this table, one cubic foot of natural gas has an energy equivalence of 1,032 Btu. 

4For the purposes of this table, one gallon of No. 2 heating oil has an energy equivalence of 137,561 Btu. 

5For the purposes of this table, one gallon of liquid propane has an energy equivalence of 91,333 Btu. 

6For the purposes of this table, one gallon of kerosene has an energy equivalence of 135,000 Btu. 

By direction of the Commission, 

Commissioner Wilson dissenting. 

April J. Tabor, 

Acting Secretary. 

Editorial Note: The Office of the Federal 

Register received this document on December 

23, 2020. 

Note: The following will not appear in the 

Code of Federal Regulations. 

Dissenting Statement of Commissioner 

Christine S. Wilson 

Today’s Commission action finalizes 

required changes to the Energy Labeling 

Rule, but fails to remove prescriptive 

aspects of the Rule that I believe are 

unnecessary and that could hinder 

important aspects of competition. For 

the reasons described below, I dissent. 

The current amendments were 

proposed in March 2020. At that time, 

and at my urging,1 the Commission also 

sought comment on the more 

prescriptive aspects of the Rule.2 I was 

pleased to receive many interesting and 

thoughtful comments submitted by 

stakeholders. For example, industry 

members explained that changes in the 

market and consumer behavior indicate 

that affixed labels with detailed 

information may have ceased to provide 

benefits to consumers.3 Industry 

members also proposed providing the 

labeling information online or through 

QR codes at brick-and-mortar locations.4

Making this information easier to access 

in the digital era could foster greater 

competition among appliance 

manufacturers and more informed 

purchasing decisions by consumers. 

Rather than act on these comments or 

proposals, though, the Commission has 

chosen to finalize only the air 

conditioning proposals necessary to 

conform to Department of Energy 

changes. The Federal Register Notice 

approved by a majority of the 

Commission explains that revising other 

aspects of the labeling obligations 

imposed by the Rule will require further 

exploration. I see no reason for the 

Commission to forego that exploration 

now. We can both finalize these changes 

and ask stakeholders for additional 

input on how to improve the rest of the 

Rule. 

The FTC promulgated the Energy 

Labeling Rule in the 1970s, an era when 

the agency was engaged in prolific 

rulemaking.5 As I have noted 

previously,6 no area of commerce was 

too straightforward or mundane to 

escape the Commission’s notice: 

• The Rule on Misbranding and 

Deception as to Leather Content of 

Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Rules and Regulations 9285 

7 16 CFR 405.4, https://www.ftc.gov/sites/default/ 

files/documents/federal_register_notices/traderegulation-rule-misbranding-and-deception-leathercontent-waist-belts-16-cfr-part-405/ 

960522traderegulationruleonmisbranding.pdf. 

8 16 CFR 231.3, https://www.ftc.gov/sites/default/ 

files/documents/federal_register_notices/guidesluggage-and-related-products-industry-guides-shoecontent-labeling-and-advertising-and-guides/ 

950918luggageandrelatedproducts.pdf. 

9 16 CFR 22.3, https://www.ftc.gov/sites/default/ 

files/documents/federal_register_notices/guideshosiery-industry-16-cfr-part-22/ 

960202hosieryindustry.pdf. 

10Energy Policy and Conservation Act, 42 U.S.C. 

6295. 

11See 16 CFR §§ 305.13 and 305.20 

12 Dissenting Statement of Commissioner 

Christine S. Wilson on the Notice of Proposed 

Rulemaking: Energy Labeling Rule (Dec. 10, 2018), 

https://www.ftc.gov/public-statements/2018/12/ 

dissenting-statement-commissioner-christine-swilson-notice-proposed; Dissenting Statement of 

Commissioner Christine S. Wilson on the Notice of 

Proposed Rulemaking: Energy Labeling Rule (Oct. 

22, 2019), https://www.ftc.gov/system/files/ 

documents/public_statements/1551786/r611004_

wilson_dissent_energy_labeling_rule.pdf. 

13See 81 FR 62861 (Sept. 12, 2016) (seeking 

comment on proposed amendments regarding 

portable air conditioners, ceiling fans, and electric 

water heaters); 84 FR 9261 (Mar. 14, 2019) 

(proposing amendments to organize the Rule’s 

product descriptions); 85 FR 20218 (Apr. 10, 2020) 

(seeking comment on proposed amendments 

regarding central and portable air conditioners). 

Waist Belts prescribed unlawful 

practices in connection with the sale of 

belts when not offered for sale as part 

of a garment. Among other things, the 

Rule prohibited the sale of belts that 

looked like leather, but that were made 

of split, ground, pulverized, or shredded 

leather or non-leather material, absent 

disclosures.7

• The Guides for Shoe Content 

Labeling and Advertising required 

leather, split leather, and concealed 

insoles ‘‘containing . . . non-leather 

material which are concealed from 

view, but which also contain other 

visible parts of leather,’’ to bear a label 

clearly disclosing the presence of the 

non-leather innersole.8

• The Hosiery Guides established that 

the term ‘‘long staple cotton’’ used to 

describe hosiery ‘‘is understood to mean 

cotton fiber which is not less than 1 1⁄8′′ 

in length of staple’’ and that the term 

‘‘lisle’’ represents hosiery ‘‘made of yarn 

composed of two or more ply of combed 

long staple cotton fiber.’’ 9

A federal statute mandated that the 

FTC promulgate the Energy Labeling 

Rule.10 The FTC must implement the 

will of Congress, but it need not adopt 

a prescriptive approach while doing so. 

Here, the FTC itself has chosen to 

specify the trim size dimensions for 

labels, including the precise width 

(between 51⁄4′′ to 5 1⁄2′′) and length 

(between 7 3⁄8′′ and 7 5⁄8′′); the number 

of picas for the copy set (between 27 

and 29); the type style (Arial) and 

setting; the weight of the paper stock on 

which the labels are printed (not less 

than 58 pounds per 500 sheets or 

equivalent); and a suggested minimum 

peel adhesive capacity of 12 ounces per 

square inch.11 I urged the Commission 

take the opportunity to review these 

detailed labeling requirements in 2018, 

and again in 2019, when the 

Commission sought comment and 

revised other sections of this Rule.12

The Commission last conducted a full 

review of the Energy Labeling Rule in 

2015; under our 10-year regulatory 

schedule, the next review is scheduled 

for 2025. However, since 2015, the 

Commission has sought comment on 

provisions of this Rule at least three 

times, including the current proceeding, 

and has made numerous amendments.13

This piecemeal approach has clarified 

the Rule’s requirements—and I 

appreciate FTC staff’s efforts to keep 

this Rule clear and current—but the 

Commission can and should do more. 

Specifically, the Commission should 

conduct a full review of the Rule to 

consider removing all dated and 

prescriptive provisions, and to consider 

the recent comments suggesting 

changes. Nothing prevents the 

Commission from conducting this 

review now—we do not have to wait 

until the 10-year anniversary. I urge the 

Commission to act on these comments, 

eliminate the more prescriptive aspects 

of the Rule, and maximize the positive 

impact of this Rule for consumers. If we 

are statutorily mandated to maintain 

this Rule, we should endeavor to make 

it beneficial for consumers and 

competition. 

[FR Doc. 2020–28880 Filed 2–11–21; 8:45 am] 

BILLING CODE 6750–01–P 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 1 

[TD 9933] 

RIN 1545–BO79 

Unrelated Business Taxable Income 

Separately Computed for Each Trade 

or Business; Correction 

AGENCY: Internal Revenue Service (IRS), 

Treasury. 

ACTION: Final rule; correction. 

SUMMARY: This document contains 

corrections to the final regulations 

(Treasury Decision 9933) that published 

in the Federal Register on Wednesday, 

December 2, 2020. The final regulations 

provide guidance on how an exempt 

organization subject to the unrelated 

business income tax determines if it has 

more than one unrelated trade or 

business, and, if so, how the exempt 

organization calculates unrelated 

business taxable income. 

DATES: These corrections are effective 

on February 12, 2021 and are applicable 

on December 2, 2020. 

FOR FURTHER INFORMATION CONTACT: 

Jonathan A. Carter at (202) 317–5800 or 

Stephanie N. Robbins at (202) 317–4086 

(not toll-free numbers). 

SUPPLEMENTARY INFORMATION: 

Background 

The final regulations (TD 9933) that 

are the subject of this correction are 

issued under section 512 of the Internal 

Revenue Code. 

Need for Correction 

As published the final regulations (TD 

9933) contain errors that needs to be 

corrected. 

Correction of Publication 

Accordingly, the final regulations (TD 

9933), that are the subject of FR Doc. 

2020–25954, published on December 2, 

2020 (85 FR 77952), are corrected to 

read as follows: 

1. On page 77952, the third column, 

the seventeenth line from the top of the 

second full paragraph, the language 

‘‘balances legislative’’ is corrected to 

read ‘‘balances the legislative’’. 

2. On page 77954, the third column, 

the first line of the first full paragraph, 

the language ‘‘Because the NAICS’’ is 

corrected to read ‘‘Because NAICS’’. 

3. On page 77961, the second column, 

the third line from the bottom of the 

first partial paragraph, the language 

‘‘rule’’ is corrected to read ‘‘test’’. 

4. On page 77964, the second column, 

removing the language ‘‘of the 

supported organization’’ from the third 

and fourth lines from the bottom of the 

last full paragraph. 

5. On page 77964, the third column, 

the second line from the bottom of the 

last partial paragraph, the language 

‘‘Accordingly, the’’ is corrected to read 

‘‘The’’. 

6. On page 77965, the second column, 

the thirteenth line from the top of the 

first partial paragraph, the language 

‘‘owns interest’’ is corrected to read 

‘‘owns the interest’’. 

7. On page 77965, the third column, 

the third line from the bottom of the 

first full paragraph, the language ‘‘E.O.;’’ 

is corrected to read ‘‘exempt 

organization’’. 

8. On page 77967, the second column, 

the fifth line from the bottom of the first