National Impact Analysis2ANOPR Analyses Flow DiagramFrameworkDocumentANOPRNOPRFinalRuleNationalImpactAnalysisEnergy UseCharacterizationMarket andTechnologyAssessmentScreeningAnalysisEngineeringAnalysisMarkups forEquipmentPriceDeterminationLife-CycleCost andPaybackPeriod AnalysisShipmentsAnalysisNational Impact Analysis3PurposeShipments Analysis•Estimate refrigerated beverage vending machine (BVM) equipment shipmentsover time.National Impact Analysis•Estimate the National Energy Savings(NES) from BVM equipment at differentefficiency levels.•Estimate the national economic impacton the nation (or the Net PresentValue (NPV)) of the BVM equipmentat different efficiency levels.4National Impact Analysis ProcessShipmentsModelNationalEnergySavingsNationalEconomicImpactsLCCAnalysisResults andOther InputsNationalEnergy Savings(Quads)NationalNet Present Value(2007$, billion)National energy savings calculated for period from 2012-2042 (30 years).NPV calculated for period from 2012-2062 (50 years).National Impact Analysis5Inputs to Shipments Analysis ModelShipments AnalysisPopulation ForecastIndustry Estimate ofShipments (2002-2005)Initial ReplacementShipmentsInitial Shipments to NewLocationsInitial BVM StockEstimated Lifetimeof BVM StockShipments to NewLocationsReplacementShipmentsTotalShipments ByEquipmentClass and Size% Shipments byEquipment Class (2002-2005)BVM StockbyEquipmentClass andSizePopulation ForecastIndustry Estimate ofShipments (2002-2005)Initial ReplacementShipmentsInitial Shipments to NewLocationsInitial BVM StockEstimated Lifetimeof BVM StockShipments to NewLocationsReplacementShipmentsTotalShipments ByEquipmentClass and Size% Shipments byEquipment Class (2002-2005)BVM StockbyEquipmentClass andSize6Shipments Model InputsShipments AnalysisDistribution of Sales by Equipment Class and Purchaser•Based on 2002-2005 from State of the Vending Industry (2006),industry contacts, and assumptions (for capacities).Initial Stock•Declined from 2000 to 2006. Fell from about 4.2 million toapproximately 3.7 million.Sales of New Equipment•Assumed to be 50,000 in 2007.•Grows at 2%/yr thereafter based on rate of population growth.Sales of Replacement Equipment•All estimated sales 2001-2006 assumed to be for replacementequipment at 150,000/yr in 2001 declining to 67,000/yr in 2006.•Future replacements based on existing stock and Weibull distributionof stock survival (14-year average life) with replacement of 5%/yr.7Shipments Model ResultsShipments AnalysisThousands of Units Shipped by Year and Equipment ClassEquipment Class2012 2015 2020 2025 2030 2035 2040 2042CumulativeShipments(2012-2042)A-L-IN7.77.67.98.38.89.29.79.9265.9A-M-IN7.77.67.98.38.89.29.79.9265.9A-S-IN7.77.67.98.38.89.29.79.9265.9B-L-IO77.677.079.884.288.893.498.4100.52,688.3B-M-IO77.677.079.884.288.893.498.4100.52,688.3B-S-IO77.677.079.884.288.893.498.4100.52,688.3A=fully-cooled machine (indoor use only)S=small M=medium L=largeB=all other machines (indoor oroutdoor use)IN=indoor onlyIO=indoor/outdoor8National Impact Analysis ApproachNational Impact AnalysisStock of Units byYearUnits Shipped byYearUnits Shipped byEquipment Class,Efficiency Level byYearInstalled Costsper Unit, EnergyUse per Unit,Energy Prices,Other OperatingCosts per UnitShipmentsBackgroundMarket Sharesby EquipmentClassAnnualizedCostsCalculationsby Risk GroupMarket Shares byEquipment ClassStock of Units byEquipment Classand Efficiency,by YearInstalled Costs, byEquipment Class,Efficiency LevelTotal InstalledCosts by Year,Equipment Class,Efficiency LevelTotal EnergyUsed,Energy Costs, andOther OperatingCosts byEquipment Class,Efficieny Level,and YearElectricityPriceForecastsEnergyInformationAdministrationLCC ModelElectricity Used,Electricity Costper Unit, OtherOperating Costsper UnitDiscount Ratesand EfficiencyLevelsResults: Cumulative Energy Use, PVand Annualized Installed Cost andOperating Costs, Net Present Value andAnnualized Costs9InputsNational Impact AnalysisShipments•Annual units shipped by equipment class taken from shipments analysis.Total Installed Cost•National average cost per unit by equipment class and efficiencylevel taken fromLCC analysis.Repair and Maintenance Costs•Average annualized values per unit by equipment class and efficiency level takenfrom LCC analysis.Annual Energy Use•National average annual energy use per unit by equipment class and efficiencylevel.Market Shares by Efficiency Level•Estimated for base case using commercial customer risk-premium factors fromEIA NEMS model and LCC analysis results.•Developed for each standardscase using a roll-up approach -- base-case marketshares below a standard level are “rolled into” the market shares at the standardlevel.10Inputs (cont.)National Impact AnalysisEfficiency Trends•Future trends in average equipment efficiency improvementover time not forecastdue to lack of historical market data.Energy Prices Escalation•For base year of 2012, electricityprices taken from LCC analysis.•Future electricity prices adjusted using2007 Annual Energy Outlook (2030-2042estimated using 2020-2030 forecast trends).Electricity Site-to-Source Conversion Factors•Conversion factors forecast using2007 Annual Energy Outlook (2030-2042estimated using 2020-2030 forecast trends).•Factors vary annually and account for generation, distribution, and transmissionlosses.Discount Rate•Rate set at 7 percent and 3 percent real from OMB’s Regulatory AnalysisGuideline A-4.•Future expenses discountedto 2007, reported in 2007$.11Base Case and Standards Case Shipments Forecasts(Issue #5)Base case market shares by efficiency level are developed using aeconomic model.DOE did not have data with which to calibrate these market sharesto actual shipments by efficiency level.DOE did not have historical data to indicate how equipmentefficiencies have changed over time or might change in the future.Forecasted market shares for efficiencies above the new standardlevel remain constant from 2012 until the end of the forecast period.DOE invites comments on its basis for the forecasted shipments and itsprediction on how standards impact efficiency distributions in the yearthat standards take effect.National Impact Analysis12Differential Impact of New Standards on Future Shipmentsby Equipment Classes(Issue #6)The shipments model used by DOE presumes that the relativemarket shares between equipment classes remains constant overtime.DOE is concerned that higher standards set for specific classes ofequipment could shift the market to use other equipment that mayhave greater energy consumption.National Impact AnalysisDOE invites comments on the potentialfor standards-driven marketshifts between equipment classes that could reduce national energysavings, and how the standards-setting process can reduce oreliminate these potential shifts.13Example of Cumulative Energy Savings and Net Present Value(2012–2042 at 7% Discount Rate)National Impact AnalysisCumulative Source Energy Savings and NPV00.020.040.060.080.10.120.14 

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Cumulative Energy Savings (Quads)-0.7-0.6-0.5-0.4-0.3-0.2-0.100.10.2 NPV (Billion 2 007$)Energy SavingsNPV14Example of Net Present Value Results(2012–2042)National Impact AnalysisEfficiency LevelLevel 4Net Savings-0.00500.0050.010.0150.020.0250.032012 2016 2020 2024 2028 2032 2036 2040 2044 2048 2052 2056 2060Year

Billion 2007$Undiscounted Total Annual Operating SavingsUndiscounted Annual Equipment Purchase SavingsDiscounted Total Net Annual ImpactSelect efficiency level to plot AnnualNet Impacts trend.Total Net Annual Impact (red line) discounted at 7%15National Impact Analysis ResultsNational Energy Savings (2012-2042) range from 0.05 quads at Level2 to 0.39 quads at Level 8 (maximum efficiency level) analyzed forall equipment classesRange of NPV savings (at 7 percent discount rate) is from -$2.1billion (Level 8) to +$313 million (Level 5)Range of NPV Savings (at 3 percent discount rate) is from -$4.1billion (Level 8) to +$855 million (Level 5)National Impact Analysis16Other IssuesDOE invites comments and recommendations on any otheraspects related to the National Impact Analysis.National Impact Analysis