APPENDIX 12­A PRELIMINARY MANUFACTURER INTERVIEW GUIDES

TABLE OF CONTENTS

12­A.1 INTRODUCTION .......................................................................................... A­1

12­A.2 HEATING PRODUCTS PRELIMINARY MANUFACTURER INTERVIEW

GUIDE ......................................................................................................................... A­1

12­A.3 WATER HEATER PRELIMINARY MANUFACTURER INTERVIEW

GUIDE ......................................................................................................................... A­3

12­A.4 DIRECT HEATING EQUIPMENT PRELIMINARY MANUFACTURER

INTERVIEW GUIDE..................................................................................................... A­5

12­A.5 POOL HEATER PRELIMINARY MANUFACTURER INTERVIEW GUIDE

......................................................................................................................... A­6

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12­A.1 INTRODUCTION

This appendix presents samples of the interview guides used during the

preliminary manufacturer interviews. The interview guides detail the non­confidential

questions the Department of Energy (DOE) used as the basis for the discussions with

manufactures of residential water heaters, direct heating equipment, and pool heaters. The

results of the manufacturer interviews were aggregated and incorporated into the

engineering analysis (see chapter 5 of the preliminary technical support document (TSD))

and the preliminary manufacturer impact analysis (see chapter 12 of the preliminary

TSD).

12­A.2 HEATING PRODUCTS PRELIMINARY MANUFACTURER

INTERVIEW GUIDE

The following questions comprised the general questions DOE used while

interviewing all water heater, direct heating equipment, and pool heater manufacturers.

Heating Products Rulemaking – Preliminary Interview Guide

Preliminary Manufacturer Impact Analysis Topics

1 Key Issues

1.1 What are the key issues for your company regarding the residential heating

products rulemaking?

1.2 Are there any patent, technology, or other issues that you are aware of that would

prevent your company or competitors from implementing higher­efficiency

designs?

2 Shipment Projections

2.1 What is your company’s approximate market share in each of the product classes?

2.2 Would you expect your market share to change once standards become effective?

Does your outlook change with higher efficiency levels?

2.3 How would you expect shipments to change for the industry as a whole as a

function of standards and why?

2.4 Looking at price/cost effects only, how would you expect shipments to change for a

25, 50, 100 or 200 percent manufacturer price/cost increase?

3 Conversion Costs

3.1 What level of capital expenditure and product conversion costs would you

anticipate to make at higher standard levels? Please describe what they are and

provide your best estimate of their respective magnitudes.

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3.2 How would the imposition of new energy conservation standards affect capacity,

utilization and manufacturing assets at your domestic production facilities? Would

a new standard result in stranded capital assets? Would any facilities be closed or

downsized? Added or upgraded?

3.3 How might a new standard impact product innovation?

4 Product Mix and Profitability

4.1 How would your company’s product mix and marketing strategy change with

changes in the efficiency standard?

4.2 Would the current percentage of shipments be the same under a new standard?

4.3 What distribution channels are used from the manufacturer to the retail outlet?

What is the share of product going through each distribution channel?

4.4 Generally how would new product standards impact your customer mix,

distribution channels, and corresponding profit margins?

4.5 What is the approximate percentage of shipments (i.e., market share) for each

product, or more specifically, for each product class?

4.6 Do you enjoy a consistent profitability across all product classes?

5 Market Shares and Industry Consolidation

5.1 In the absence of new standards, do you expect any industry consolidation?

5.2 How would new standards affect your ability to compete?

5.3 Could new standards disproportionately advance or harm the competitive positions

of some firms?

5.4 Are there concerns over intellectual property?

5.5 Could new standards result in disproportionate economic or performance penalties

for particular consumer/user subgroups?

5.6 Beyond price and energy efficiency, could new standards result in products that

will be more or less desirable to consumers due to changes in product functionality,

utility, or other features?

6 Cumulative Regulatory Burden

6.1 Are there recent or impending regulations on your specific product or other

products that impose a cumulative burden on the industry?

6.2 If so, what is the total expected impact of those other regulations?

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12­A.3 WATER HEATER PRELIMINARY MANUFACTURER INTERVIEW

GUIDE

The following questions comprise the preliminary interview guide DOE used

while interviewing water heater manufacturers.

Heating Products Rulemaking – Residential Water Heaters

Preliminary Interview Guide

Design for Energy Improvement Information Request

The Department of Energy (DOE) would like to validate its assumptions for the

incremental costs of reducing product energy consumption by understanding the

technologies involved in efficiency improvement of residential water heaters.

1. Which design features impacting energy use are generally incorporated into

“baseline” water heater?

2. What design changes do manufacturers of residential water heaters make to

produce products that are more efficient? How do these design changes differ by

product class (i.e., storage versus instantaneous and fuel type)? For storage water

heaters, are these technologies applicable to all storage volumes? How do these

design changes correspond to the technologies DOE has identified for each

product class?

3. How do the costs of the individual technologies selected correspond to the cost

DOE has estimated in its analysis?

4. Are the industry manufacturing costs we have calculated representative of your

firm’s costs for water heaters?

5. How do overall dimensions affect shipping costs? If diameter is increased with

increased insulation thickness, how are shipping costs affected?

6. What percentage of water heaters are shipped with standing pilot ignition?

7. Would you help DOE understand and estimate the conversion capital investments

that would be necessary at higher efficiency levels? What is the nature of the

capital investments?

8. Are installation costs a function of efficiency? Maintenance costs? Repair costs?

If yes, would you please characterize this relationship by providing incremental

installation, maintenance, and/or repair cost data?

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9. What is the relationship between list price and manufacturer selling price?

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12­A.4 DIRECT HEATING EQUIPMENT PRELIMINARY MANUFACTURER

INTERVIEW GUIDE

The following questions comprise the interview guide DOE used while

interviewing direct heating equipment manufacturers.

Heating Products Rulemaking – Residential Direct Heating Equipment

Preliminary Interview Guide

Design for Energy Improvement Information Request

The Department of Energy (DOE) would like to validate its assumptions for the

incremental costs of reducing product energy consumption by understanding the

technologies involved in efficiency improvement of residential direct heating equipment.

1. Which design features impacting energy use are generally incorporated into

“baseline” direct heating equipment?

2. What design changes do manufacturers of residential direct heating equipment

make to produce products that are more efficient? How do these design changes

differ by product class? Are these technologies applicable to all capacity ranges?

How do these design changes correspond to the technologies DOE has identified?

3. For hearth products, how do the technologies differ from those identified for room

heaters? What percentage of room heater shipments are hearth products?

4. How do the costs of the individual technologies selected correspond to the cost

DOE has estimated in its analysis?

5. Are the industry manufacturing costs we have calculated representative of your

firm’s costs for direct heating equipment for each product class?

6. Would you help DOE understand and estimate the conversion capital investments

that would be necessary at higher efficiency levels? What is the nature of the

capital investments?

7. Are installation costs a function of efficiency? Maintenance costs? Repair costs?

If yes, would you please characterize this relationship by providing incremental

installation, maintenance, and/or repair cost data?

8. What is the relationship between list price and manufacturer selling price?

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12­A.5 POOL HEATER PRELIMINARY MANUFACTURER INTERVIEW

GUIDE

The following questions comprise the interview guide DOE used while

interviewing water heater manufacturers.

Heating Products Rulemaking – Residential Pool Heaters

Preliminary Interview Guide

Design for Energy Improvement Information Request

The Department of Energy (DOE) would like to validate its assumptions for the

incremental costs of reducing product energy consumption by understanding the

technologies involved in efficiency improvement of residential pool heaters.

1. Which design features impacting energy use are generally incorporated into

“baseline” pool heater?

2. What design changes do manufacturers of residential pool heaters make to

produce products that are more efficient? Are these technologies applicable to all

input capacities? How do these design changes correspond to the technologies

DOE has identified?

3. How do the costs of the individual technologies selected correspond to the cost

DOE has estimated in its analysis?

4. Are the industry manufacturing costs we have calculated representative of your

firm’s costs for pool heaters?

5. What percentage of “baseline” pool heaters are shipped with standing pilot

ignition systems?

6. What differentiates a residential pool heater from a commercial pool heater?

7. Would you help DOE understand and estimate the conversion capital investments

that would be necessary at higher efficiency levels? What is the nature of the

capital investments?

8. Are installation costs a function of efficiency? Maintenance costs? Repair costs?

If yes, would you please characterize this relationship by providing incremental

installation, maintenance, and/or repair cost data?

9. What is the relationship between list price and manufacturer selling price?

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