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APPENDIX 13A. MANUFACTURER IMPACT ANALYSIS INTERVIEW GUIDES 

TABLE OF CONTENTS

13A.1 FLUORESCENT LAMP BALLAST MANUFACTURER IMPACT ANALYSIS 

INTERVIEW GUIDE ..................................................................................................................... 1

13A.2 FLUORESCENT LAMP BALLAST SMALL BUSINESS MANUFACTURER 

IMPACT ANALYSIS INTERVIEW GUIDE .............................................................................. 20
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APPENDIX 13A MANUFACTURER IMPACT ANALYSIS INTERVIEW GUIDES

13A.1 FLUORESCENT LAMP BALLAST MANUFACTURER IMPACT ANALYSIS

INTERVIEW GUIDE

Manufacturer Impact Analysis Interview Guide for 

Fluorescent Lamp Ballasts

July 23, 2010 
13A-2 

The U.S. Department of Energy (DOE) is conducting a manufacturer impact analysis (MIA) as 

part of the rulemaking process to amend energy conservation standards for fluorescent lamp 

ballasts. In this analysis, DOE uses publicly available information and information provided 

during interviews to assess possible impacts on manufacturers due to amended energy 

conservation standards. 

1 TEST PROCEDURE FOLLOW-UP

DOE defines ballast efficiency (BE) as lamp arc power divided by ballast input power as 

measured while the ballast is operating a lamp. When encountering the term throughout the rest 

of this interview guide, please refer to this definition.

1.1 Are there any burdens or drawbacks due to the direct use of ballast efficiency as a metric 

for setting energy conservation standards (i.e., no correlations to BEF)? 

1.2 Are there any burdens or drawbacks due to the use of power measurements to determine 

ballast factor? In this technique, the measured output power (lamp arc power) would be 

compared to the arc power listed in ANSI C78.81, rather than comparing photocell output of a 

test and reference system. Will the variation in reference lamp measured power lead to variation 

in BF as measured and calculated by this method? 

1.3 ANSI C82.13-2002 defines a high-frequency ballast as a device that operates at a supply 

frequency of 50 or 60 Hz and operates the lamp at frequencies greater than 10 kHz. DOE is 

aware that lamps operate more efficiently at high frequency as compared to low frequency. Is 

this difference in lamp efficacy captured in the ballast efficiency metric? If not, can you suggest 

a reduction in efficiency to be applied to low frequency ballasts that will capture this difference?

1.4 What is the typical variation in ballast efficiency due to testing (instrumentation, 

materials, procedure)? What is the typical variation due to manufacturing variability (within 

multiple samples of the same model number)? Do you have any test data that you can provide to 

illustrate this variation?

1.5 Are you aware of any issues that might arise if DOE were to require testing at NVLAPaccredited labs?

2 PRELIMINARY ANALYSIS FOLLOW-UP

On March 24, 2010 DOE published a Federal Register notice announcing the availability of the 

preliminary technical support document.1 The following questions expand upon topics discussed 

in that document and at the April 26, 2010 public meeting. 

Scope of Coverage 

 

1 For more details about the analysis that has been done to date, please visit DOE’s website at: 

http://www1.eere.energy.gov/buildings/appliance_standards/residential/fluorescent_lamp_ballasts.html. 
13A-3 

2.1 Manufacturers commented that magnetic ballasts may be required for certain EMF/EMI 

sensitive applications where no “noise” can be tolerated. Can you please provide examples of 

these applications (and their associated EMI tolerances)? How large is the market for these types 

of ballasts?

2.2 Some ballasts that operate F96T8HO lamps are advertised to start in temperatures down 

to -20°F, though these ballasts are not marketed as cold temperature sign ballasts. Can traditional 

F96T8HO ballasts be used in outdoor sign applications? 

2.3 ANSI C82.13 provides definitions for instant-start (IS), modified rapid-start, programmed 

start (PS), rapid-start (RS), and switch-start (preheat) systems. How many of these starting 

methods are present in commercially available ballasts? Should DOE use the ANSI definitions 

to distinguish between the various starting methods?

Product Classes 

2.4 In the preliminary analysis, DOE put forward energy conservation standards specific to 

particular ballast factor bins. Do you believe this approach is necessary if BE were the metric? If 

so, should the ranges attributed to each ballast factor bin be revised (Low: BF ≤ 0.78, Normal: 

0.78 < BF < 1.10, High: BF ≥ 1.10)? 

2.5 NEMA provided recommended standard levels that indicate that BE increases with 

increasing BF. However based on an initial survey of commercially-available products, normal 

ballast factor ballasts often have the highest efficiency. Can you explain this trend?

2.6 All other things being equal, DOE believes that a programmed-start ballast should be less 

efficient than an instant-start ballast due to cathode heating. However, DOE’s preliminary test 

data found this to not always be the case. In fact, about a third of the time, a PS ballast was more 

efficient than a comparable IS ballast. Do you know why this might be occurring? What trend 

would you expect to see? 

2.7 What are the cathode heating losses associated with rapid start and programmed start 

ballasts that operate 4-foot MBP, 8-foot RDC HO, 4-foot T5 MiniBP SO, and 4-foot T5 MiniBP 

HO lamps?

2.8 NEMA provided recommended standard levels that indicate that BE increases with 

number of lamps operated by the ballast. However based on an initial survey of commerciallyavailable products, two-lamp and four-lamp ballasts often have the highest efficiency (relative to 

one-, three-, and six- lamp ballasts). Can you explain this trend? 

2.9 Residential ballasts are subject to different power factor requirements than commercial 

ballasts. Can you estimate the additional power losses associated with the power factor 

correction stage in commercial ballasts?
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2.10 The FCC requires residential ballasts to meet stricter EMI requirements than commercial 

ballasts. Can you estimate the additional power losses associated with the addition of an EMI 

filter?

Engineering Analysis 

DOE explicitly analyzes the ten representative product classes listed in the table below. DOE is 

currently considering between one and three efficiency levels (ELs) for each product class that 

correspond to higher ballast efficiency than the existing standards. In responding to this 

questionnaire, please refer to the ELs in the table below. The ballast efficiencies presented are 

mean tested efficiencies – taking into account products from several manufacturers. These levels 

do not take into account any kind of reduction (as recommended by NEMA) due to reporting 

requirements. DOE explains how it intends to determine the minimum efficiencies for the 

remaining product classes in the engineering chapter of the technical support document.2

 

 

2 Please see 

http://www1.eere.energy.gov/buildings/appliance_standards/residential/fluorescent_lamp_ballasts_ecs_prelim_tsd.h

tml for a complete description. 
13A-5 

Table 2.1 Efficiency Levels and Manufacturer Selling Prices for Representative Product 

Classes

Ref 

# Product Class EL BE+

(%)

MSP++

($) Product Line

1 Two Lamp Normal BF 

4ft MBP IS & RS

Baseline 81.0

Baseline/EL 1 86.0

EL 2 90.0

EL 3 91.6

EL 4* 92.0

2 Two Lamp Normal BF 

4ft MBP PS

Baseline 84.3

EL 1 89.1 

EL 2* 90.2

3 Four Lamp Normal BF 

4ft MBP IS & RS

Baseline 90.5

EL 1 92.0

EL 2* 93.1

4 Four Lamp Normal BF 

4ft MBP PS

Baseline 83.9

EL 1 89.4

EL 2* 92.5

5 Two Lamp Normal BF 

8ft SP Slimline

Baseline

Baseline/EL 1 90.0

EL 2 92.2

EL 3* 93.8

6 Two Lamp 8ft RDC HO 

IS & RS

Baseline

EL 1

EL 2

EL 3*

7 Two Lamp Normal BF 

4ft T5 MiniBP SO

Baseline 79.1

EL 1 87.1

EL 2* 89.6

8 Two Lamp 4ft T5 

MiniBP HO

Baseline 74.2

EL 1 87.8

EL 2* 90.3

9 Two Lamp 4ft MBP IS 

& RS Residential

Baseline 75.7

Baseline/EL 1 86.4

EL 2 88.5

EL 3* 90.4

10 Four Lamp Sign Ballasts

Baseline

EL 1

EL 2* + The blank boxes in this column have not yet been determined due to ongoing testing.

++ The MSPs reported in this column were provided at a previous interview for the preliminary analysis and 

represent the typical price to an OEM fixture manufacturer.

*The highest EL in each product class represents the “best in market” or the most efficient ballast as tested by DOE

2.11 If possible, please fill in the blank boxes in Table 2.1 to identify the representative BE or 
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MSP for each efficiency level. In addition, please indicate which efficiency levels are 

representative of your product lines. 

2.12 Do you agree with the efficiency levels described in the table above? Do you suggest any 

modifications or additions? 

2.13 Are the manufacturer selling prices and incremental costs developed in the engineering 

analysis and displayed in Table 2.1 representative of your company’s products? If not, please 

provide a quantitative indication of the differences. 

2.14 Do you believe that efficiency required to qualify for NEMA Premium would be the 

same if the program were extended to all ballast types identified in Table 2.1? 

Max Tech

2.15 Max Tech: The efficiency levels in Table 2.1 are based on commercially available 

products. However, DOE is required to consider the maximum technologically feasible energy 

conservation standard. To this point, DOE intends to analyze an efficiency level above the most 

efficient commercially available ballast. 

Table 2.2 lists the most efficient level in each representative product class. Please provide any 

efficiency improvements that may be possible as well as the associated cost increase expected.
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Table 2.2 Fluorescent Lamp Ballast Max Tech Levels for Representative Product Classes

Ref 

# Product Class

Highest Efficiency 

Commercially 

Available Product 

Analyzed

Potential 

Efficiency 

Improvement

Design Pathway Associated 

Cost Increase

1 Two Lamp Normal BF 

4ft MBP IS & RS 92.0% 

2 Two Lamp Normal BF 

4ft MBP PS 90.2% 

3 Four Lamp Normal BF 

4ft MBP IS & RS 93.1% 

4 Four Lamp Normal BF 

4ft MBP PS 92.5% 

5 Two Lamp Normal BF 

8ft SP Slimline 93.8% 

6 Two Lamp 8ft RDC 

HO IS & RS 89.4%* 

7 Two Lamp Normal BF 

4ft T5 MiniBP SO 89.6%

8 Two Lamp 4ft T5 

MiniBP HO 90.3%

9 Two Lamp 4ft MBP IS 

& RS Residential 90.4% 

10 Four Lamp Sign 

Ballasts 90.4%* 

*This value is from the preliminary analysis. DOE is currently retesting all ballasts in this product class.

2.16 Does your company currently sell any products that exceed the max-tech efficiency levels 

listed in the table above? If so, which ones? 

Residential Sector 

2.17 What are the characteristics (BE, BF, starting method, number of lamps, etc.) of the most 

common, least efficient ballast in the residential sector? For T8s, what percent are IS versus PS? 

What is the distribution of ballast factor in the residential sector?

2.18 In the residential sector, what percent are T12 versus T8 systems? Is it possible for T12 

and T8 systems in the residential sector to have similar light output? 

3 KEY ISSUES

3.1 In general, what are the key issues for your company regarding amended energy 

conservation standards and this rulemaking? 

3.2 For the issues identified, how significant are they for each efficiency level?

3.3 Are any of the issues more or less significant for different product classes or ballast
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types?

3.4 Do you have any suggestions for incorporating the identified issues into DOE’s 

manufacturing impact model?

4 COMPANY OVERVIEW AND ORGANIZATIONAL CHARACTERISTICS

DOE is interested in understanding manufacturer impacts at the plant or profit center level 

directly pertinent to fluorescent lamp ballast production. However, the context within which the 

plant operates and details of plant production and costs are not always readily available from 

public sources. Therefore, DOE invites you to provide these details confidentially, in your own 

words, to the extent possible and practical. Understanding the organizational setting around the 

fluorescent lamp ballast profit center will help DOE understand the probable future of the 

manufacturing activity with and without amended energy conservation standards. 

4.1 Do you have a parent company, and/or any subsidiaries relevant to the fluorescent lamp 

ballast industry?

4.2 What is your company’s approximate market share of the fluorescent lamp ballast 

market? Does this vary significantly for any particular product class that you manufacture?

4.3 Do you manufacture any products other than fluorescent lamp ballasts? If so, what other 

products do you manufacture? What percentage of your total manufacturing revenue corresponds 

to fluorescent lamp ballasts?

4.4 What percentage of your fluorescent lamp ballast manufacturing corresponds to each 

ballast type, both in terms of revenue and shipments? Please indicate if you do not manufacture a 

particular type of ballast.

Table 4.1 Fluorescent Lamp Ballast Percent Revenue and Shipment Volumes by Ballast 

Type 

Ballast Type 2009 Revenue 2009 Shipments

4-foot MBP IS and RS

4-foot MBP PS

8-foot SP Slimline

8-foot RDC HO

4-foot T5 MiniBP SO

4-foot T5 MiniBP HO

Residential Ballasts

Sign Ballasts
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5 MARKUPS AND PROFITABILITY

One of the primary objectives of the MIA is to assess the impact of amended energy 

conservation standards on industry profitability. In this section, DOE would like to understand 

the current markup structure of the industry and how amended energy conservation standards 

would impact your company’s markup structure and profitability. 

DOE estimated the manufacturer production costs for the ten representative product classes of 

fluorescent lamp ballasts. DOE defines manufacturer production cost as all direct costs 

associated with manufacturing a product: direct labor, direct materials, and overhead (which 

includes depreciation). The manufacturer markup is a multiplier applied to manufacturer 

production cost to cover non-production costs, such as SG&A and R&D, as well as profit. It 

does not reflect a “profit margin.” 

The manufacturer production cost times the manufacturer markup equals the manufacturer 

selling price. Manufacturer selling price is the price manufacturers charge their first customers, 

but does not include additional costs along the distribution channels. 

DOE estimated a baseline markup of 1.50 for fluorescent lamp ballasts. 

5.1 Is the 1.50 baseline markup representative of an average industry markup? 

5.2 Please comment on the baseline markup DOE calculated as compared to your company’s 

baseline markups for the fluorescent lamp ballast representative product classes.3

 

5.3 Please explain if profit levels vary by product class or product line. If yes, please indicate 

why. 

5.4 Because the market disruption caused by efficiency standards can alter the pricing of 

premium products, DOE is interested in understanding how margins currently change with 

efficiency. Within each product class, do markups vary by efficiency level? If yes, please 

provide information about the markups at higher efficiencies. 

5.5 What factors besides efficiency affect the profitability of fluorescent lamp ballasts within 

a product class?

5.6 Does your markup change with selected design options? Is the markup on incremental 

costs for more efficient designs different than the markup on the baseline models (as is assumed 

for retailer markups used in the analyses)?

5.7 Would you expect changes in your estimated profitability following an amended energy 

 

3 Please refer to Table 2.1 for a list of representative product classes.
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conservation standard? If so, please explain why. Can you suggest any scenarios that would 

model these expected changes?

5.8 In its preliminary analysis, DOE developed average markups for electrical wholesalers 

using publicly-available financial data. The surveyed wholesalers distribute other electrical 

products in addition to lighting; however, the available financial data does distinguish between 

their product lines. Within the same electrical wholesaler company, would you expect price 

markups for lighting products to be more, less, or no different than markups for other nonlighting electrical products?

6 SHIPMENT PROJECTIONS

An amended energy conservation standard can change overall shipments by altering product 

attributes, marketing approaches, product availability, and prices. The industry revenue 

calculations are based on the shipment projections developed in DOE’s shipments model. The 

shipments model includes forecasts for the base case shipments (i.e., total industry shipments 

absent amended energy conservation standards) and the standards case shipments (i.e., total 

industry shipments with amended energy conservation standards). DOE modeled two base case 

scenarios: an Existing Technologies scenario and an Emerging Technologies scenario. The 

latter assumes greater penetration of alternative lighting technologies, such as LEDs.

To determine efficiency distributions after the compliance date of the standard, DOE modeled 

two scenarios for 2014 and subsequent years: “roll-up” and “shift.” In the roll-up scenario, DOE 

assumed that product efficiencies in the base case that did not meet the standard under 

consideration would roll up to meet the new standard in 2014. In the shift scenario, some 

products that exceed the new standard level in the base case shift to even higher efficiencies in 

the standards case.

6.1 For each ballast type considered for coverage, what is the proportion of ballasts shipped 

by NEMA companies versus non-NEMA companies?

6.2 What kind of substitution between ballast types do you observe now? What shifts do you 

expect to see over time? Do you expect substitution trends to change as a result of standards? 

6.3 How do you think amended energy conservation standards will impact the sales of more 

efficient products? For example, would customers continue to buy products that exceed the 

energy conservation standard level? Would your response change for higher mandated efficiency 

levels?

6.4 DOE assumed that revised standards that increase purchase price do not result in reduced 

demand or shipments (price inelasticity). Do you agree with this assumption? If not, how 

sensitive do you think shipments will be to price changes? Does it vary with product class? 

6.5 Do you expect characteristics of ballasts to change in response to the standards? For 
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example, would new ballast factors or starting methods enter the market?

6.6 Would you expect your market share to change when higher energy conservation 

standards take effect?

6.7 Currently, DOE analyzes two replacement scenarios – one where lumen output is 

unchanged when replacing a ballast (because spacing can be changed) and one where lumen 

output does change (because the fixture spacing is fixed). Are both scenarios realistic for the 

commercial market? Are both scenarios realistic for the residential market? Can DOE assume 

that equal lumen replacements will exist at all efficiency levels?

6.8 For cold temperature sign ballasts, DOE estimated historical shipments based on U.S. 

Census data for 800-1000 mA rapid-start magnetic ballasts. This Census product category was 

not disaggregated by lamp length, lamps operated, cold temperature design, etc., and indicated 

total shipments of approximately 2.7 million units per year from 1990-2005, on average. What 

proportion of this Census shipments category is attributable to F96T12HO cold temp/sign 

ballasts? What are the proportions of ballasts shipped by number of lamps operated (e.g., 2-

lamp, 4-lamp, etc.)? What proportion of sign ballasts shipped are magnetic versus electronic? 

Absent new energy conservation standards, do you expect these proportions to change over time? 

If so, how? 

7 FINANCIAL PARAMETERS

Navigant Consulting, Inc. has developed a “strawman” model of the fluorescent lamp ballast

industry financial performance called the Government Regulatory Impact Model (GRIM) using 

publicly available data. However, this public information might not be reflective of 

manufacturing at the fluorescent lamp ballast profit center. This section attempts to understand 

the financial parameters for fluorescent lamp ballast manufacturing and how your company’s 

financial situation could differ from the industry aggregate picture. 
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7.1 In order to accurately collect information about fluorescent lamp ballast manufacturing, 

please compare your financial parameters to the GRIM parameters tabulated below.

Table 7.1 Financial Parameters for Fluorescent Lamp Ballast Manufacturers

GRIM Input Definition

Industry 

Estimated

Value

Your Actual (If 

Significantly 

Different from 

DOE’s Estimate)

Income Tax 

Rate

Corporate effective income tax paid (percentage of 

earnings before taxes, EBT) 27.6%

Discount Rate

Weighted average cost of capital (inflation-adjusted 

weighted average of corporate cost of debt and return 

on equity)

7.0%

Working 

Capital

Current assets less current liabilities (percentage of 

revenues) 8.3%

Net PPE Net plant property and equipment (percentage of 

revenues) 14.6%

SG&A Selling, general, and administrative expenses 

(percentage of revenues) 19.4%

R&D Research and development expenses (percentage of 

revenues) 3.8%

Depreciation Amortization of fixed assets (percentage of revenues) 3.7%

Capital 

Expenditures

Outlay of cash to acquire or improve capital assets 

(percentage of revenues, not including acquisition or 

sale of business units)

4.2%

Cost of Goods 

Sold

Includes material, labor, overhead, and depreciation 

(percentage of revenues) 66.7%

7.2 Do any of the financial parameters in Table 7.1 change significantly based on product 

class? Please describe any differences. 

7.3 Do any of the financial parameters in Table 7.1 change for a particular subgroup of 

manufacturers? Please describe any differences. 

7.4 How would you expect an amended energy conservation standard to impact any of the 

financial parameters for the industry? 

8 CONVERSION COSTS

DOE understands that amended energy conservation standards may cause your company to incur 

capital and product conversion costs to redesign existing products and make changes to existing 

production lines. Understanding the nature and magnitude of the conversion costs is a critical 

portion of the MIA. Depending on their magnitude, the conversion costs can have a substantial 

impact on the outputs used by DOE to evaluate the industry impacts. The MIA considers two 

types of conversion costs: 

• Capital conversion costs are one-time investments in plant, property, and equipment 
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(PPE) necessitated by an amended energy conservation standard. These may be 

incremental additions to existing PPE or the replacement of existing PPE. Included are 

expenditures on buildings, equipment, and tooling. 

• Product conversion costs are costs related to research, product development, testing, 

marketing and other costs for redesigning products necessitated by an amended energy 

conservation standard. 

Table 8.1 shows the design options used to research higher efficiencies for the major product 

categories covered by this rulemaking. DOE asks a number of questions to understand the nature 

and magnitude of your expected capital and product conversion costs. Please refer to Table 8.1

when considering your response to the following questions. In general, improved components 

include lower loss magnetic components and electrical components such as mosfets and diodes. 

Table 8.1 Design Options Used to Improve Efficiency for each Analyzed Product Class

Ref # Product Class EL Design Options

1 Two Lamp Normal BF 

4ft MBP IS & RS

1 T8 diameter, IS starting method

2 EL1 + better components, active feedback and control

3 EL2 + even better components

4 EL3 + the best components and circuit designs

2 Two Lamp Normal BF 

4ft MBP PS

1 Better components, cathode cutout

2 EL1 + even better components, smart controls

3 Four Lamp Normal BF 

4ft MBP IS & RS

1 Better components, active feedback and control

2 EL1 + the best components and circuit designs

4 Four Lamp Normal BF 

4ft MBP PS

1 Better components, cathode cutout

2 EL1 + better components, smart controls

5 Two Lamp Normal BF 

8ft SP Slimline

1 T8 Diameter

2 EL1 + better components, active feedback and control

3 EL2 + the best components, high/low temperature operation

6 Two Lamp Normal BF 

8ft RDC HO IS & RS

1 Electronic ballasts

2 EL1 + cathode control, feedback/constant lumen

3 EL2 + the best components and circuit designs

7 Two Lamp Normal BF 

4ft T5 MiniBP SO

1 Electronic ballasts

2 EL1 + the best components and circuit designs

8 Two Lamp 4ft T5 

MiniBP HO

1 Electronic ballasts

2 EL1 + the best components and circuit designs

9 Two Lamp 4ft MBP 

IS & RS Residential

1 T8 diameter

2 EL1 + Better components, active feedback and control

3 EL2 + the best components and circuit designs

10 Four Lamp Sign 

Ballasts

1 Electronic ballasts

2 EL1 + the best components and circuit designs
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8.1 At your manufacturing facilities, would these design options be difficult to implement? If 

so, would your company modify the existing facility or develop a new facility?

8.2 Are there certain design options that would require relatively minor changes to existing 

products? Are there certain efficiency levels where the capital or product conversion costs 

significantly increase over the previous efficiency levels? Would your answer change for 

different product classes? Please describe these changes qualitatively. 

8.3 For each of the product classes shown in Table 8.1, which ELs could be made within 

existing platform designs and which would result in major product redesigns? 

8.4 Please provide estimates for your capital conversion costs by product class in Table 8.2

below. In the description column, DOE is interested in understanding the kinds of changes that 

would need to be implemented to production lines and production facilities at each efficiency 

level. Where applicable, please quantify the number and cost of new production equipment, 

molds, etc., that would be required to implement the specified design changes. 
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Table 8.2 Expected Capital Conversion Costs for Fluorescent Lamp Ballasts 

Ref # Product Class EL Total Capital 

Conversion Costs Description

1 Two Lamp Normal BF 4ft MBP IS & RS

1 

2

3 

4 

2 Two Lamp Normal BF 4ft MBP PS 1 

2 

3 Four Lamp Normal BF 4ft MBP IS & RS 1 

2 

4 Four Lamp Normal BF 4ft MBP PS 1

2 

5 Two Lamp Normal BF 8ft SP Slimline

1

2 

3

6 Two Lamp Normal BF 8ft RDC HO IS & RS

1 

2 

3 

7 Two Lamp Normal BF 4ft T5 MiniBP SO 1 

2

8 Two Lamp 4ft T5 MiniBP HO 1 

2

9 Two Lamp 4ft MBP IS & RS Residential

1 

2

3 

10 Four Lamp Sign Ballasts 1 

2 

8.5 Would the changes in question 8.4 be similar across all of your production lines and 

factories for each product class? 

8.6 What level of product development and other product conversion costs would you expect 

to incur for each of these design changes for each product class? Please provide your estimates in 

Table 8.3 below considering such expenses as product development expenses, prototyping, 

testing, certification, and marketing. In the description column, please describe the assumptions 

behind the estimates provided. 
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Table 8.3 Expected Product Conversion Costs for Fluorescent Lamp Ballasts

Ref # Product Class EL Total Product 

Conversion Costs Description

1 Two Lamp Normal BF 4ft MBP IS & RS

1 

2

3 

4 

2 Two Lamp Normal BF 4ft MBP PS 1 

2 

3 Four Lamp Normal BF 4ft MBP IS & RS 1 

2 

4 Four Lamp Normal BF 4ft MBP PS 1

2 

5 Two Lamp Normal BF 8ft SP Slimline

1

2 

3

6 Two Lamp Normal BF 8ft RDC HO IS & RS

1 

2 

3 

7 Two Lamp Normal BF 4ft T5 MiniBP SO 1 

2

8 Two Lamp 4ft T5 MiniBP HO 1 

2

9 Two Lamp 4ft MBP IS & RS Residential

1 

2

3 

10 Four Lamp Sign Ballasts 1 

2 

8.7 Please provide any additional qualitative information that might help DOE understand the 

types and nature of your investments, including the plant and tooling changes and the product 

development effort required at different efficiency levels.

9 CUMULATIVE REGULATORY BURDEN

Cumulative regulatory burden refers to the burden that industry faces from overlapping effects of 

new or revised DOE standards and/or other regulatory actions affecting the same product or 

industry.

9.1 Below is a list of regulations that could affect manufacturers of fluorescent lamp ballasts. 

Please provide any comments on the listed regulations and provide an estimate for your expected 

compliance cost.
13A-17

Table 9.1 Other Regulations Identified by DOE

Regulation Estimated or Actual 

Effective Date(s)

Expected Expense 

for Compliance Comments

DOE’s Energy Conservation 

Standards for Other Products and 

Equipment

International Energy Efficiency 

Standards

Line Voltage Disconnect 

Requirements

UL1598 Revision

End of Life Requirements 

(Europe) 

Electromagnetic Field (EMF) 

Requirements

Restriction of Hazardous 

Substances (RoHS)

9.2 Are there any other recent or impending regulations that fluorescent lamp ballast 

manufacturers face (from DOE or otherwise)? If so, please identify the regulation, the 

corresponding effective dates, and your expected compliance cost. 

9.3 Under what circumstances would you be able to coordinate any expenditure related to 

these other regulations with an amended energy conservation standard? 

9.4 DOE research has not identified any production tax credits for manufacturers of 

fluorescent lamp ballasts. Do you know of any current or future tax credits or other benefits 

available to your company for manufacturing more efficient fluorescent lamp ballasts? If so, 

please describe.

9.5 Please discuss any intellectual property considerations regarding RoHS-compliant 

solders. 

10 DIRECT EMPLOYMENT IMPACT ASSESSMENT

The impact of amended energy conservation standards on employment is an important 

consideration in the rulemaking process. This section of the interview guide seeks to explore 

current trends in fluorescent lamp ballast employment and solicit manufacturer views on how 

domestic employment patterns might be affected by amended energy conservation standards. 

10.1 Where are your fluorescent lamp ballast facilities that produce products for the United 

States located? What types of products are manufactured at each location? Please provide annual 

shipment figures for your company’s fluorescent lamp ballast manufacturing at each location by 
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product class. Please also provide employment levels at each of these facilities.

Table 10.1 Fluorescent Lamp Ballast Manufacturing Facilities

Facility Location Product Types Manufactured Employees Annual 

Shipments

Example Jackson, TN PC 1, PC 8 650 300,000for PC 1, 

200,000 for PC 8

1 

2 

3 

4 

5 

10.2 Would your domestic employment levels be expected to change significantly under 

amended energy conservation standards? If so, please explain how and why they would change if 

higher efficiency levels were required.

10.3 Would the workforce skills necessary under amended energy conservation standards 

require extensive retraining or replacement of employees at your manufacturing facilities?

10.4 Would amended energy conservation standards require extensive retraining of your 

service/field technicians? If so, could you expand on how your service infrastructure would be 

impacted in general as a result of amended energy conservation standards? 

11 MANUFACTURING CAPACITY AND NON-US SALES

11.1 How would amended energy conservation standards impact your company’s 

manufacturing capacity?

11.2 For any design changes that would require new production equipment, please describe 

how much downtime would be required. What impact would downtime have on your business? 

Are there any design changes that could not be implemented before the compliance date of the 

final rule for certain product classes?

11.3 What percentage of your company’s fluorescent lamp ballast sales are made within the 

United States?

11.4 What percentage of your fluorescent lamp ballast sales are produced in the United 

States? 

11.5 What percentage of your U.S. production of fluorescent lamp ballasts is exported?
13A-19

11.6 Are there any foreign companies with North American production facilities?

11.7 Would amended energy conservation standards impact your domestic vs. foreign 

manufacturing or sourcing decisions? Is there an efficiency level that would cause you to move 

existing domestic production facilities outside the U.S.?

12 IMPACT ON COMPETITION

Amended energy conservation standards can alter the competitive dynamics of the market. This 

can include prompting companies to enter or exit the market, or to merge. DOE and the 

Department of Justice are both interested in any potential reduction in competition that would 

result from an amended energy conservation standard.

12.1 How would industry competition change as a result of amended energy conservation 

standards? How would amended energy conservation standards affect your ability to compete in 

the marketplace? Would the effects on your company be different than others in the industry? 

12.2 Do any firms hold intellectual property that gives them a competitive advantage 

following amended energy conservation standards? 

13 IMPACTS ON SMALL BUSINESS

13.1 The Small Business Administration (SBA) denotes a small business in the fluorescent 

lamp ballast manufacturing industry as having less than 750 total employees, including the 

parent company and all subsidiaries.4 By this definition, is your company considered a small 

business? 

13.2 Are there any reasons that a small business manufacturer might be at a disadvantage 

relative to a larger business under amended energy conservation standards? Please consider such 

factors as technical expertise, access to capital, bulk purchasing power for materials/components, 

engineering resources, and any other relevant issues.

13.3 To your knowledge, are there any small businesses for which the adoption of amended 

energy conservation standards would have a particularly severe impact? If so, why? 

13.4 To your knowledge, are there any niche manufacturers or component manufacturers for 

which the adoption of amended energy conservation standards would have a particularly severe 

impact? If so, why? 

 

4 DOE uses the small business size standards published on August 22, 2008, as amended, by the SBA to determine 

whether a company is a small business. To be categorized as a small business, a power, distribution, and specialty 

transformer manufacturer and its affiliates may employ a maximum of 750 employees. The 750 employee threshold 

includes all employees in a business’s parent company and any other subsidiaries. 
13A-20

13A.2 FLUORESCENT LAMP BALLAST SMALL BUSINESS MANUFACTURER 

IMPACT ANALYSIS INTERVIEW GUIDE

August 17, 2010 
13A-21

The Department of Energy (DOE) conducts the manufacturer impact analysis (MIA) as part of 

the rulemaking process to amend energy conservation standards for fluorescent lamp ballasts. In 

this analysis, DOE uses publicly available information and information provided during 

interviews to assess possible impacts on manufacturers due to amended energy conservation 

standards. 

1 INTRODUCTION

1.1 Are you aware of the US Department of Energy’s (DOE’s) ongoing rulemaking to amend 

national minimum energy conservation standards for fluorescent lamp ballasts? If you are not 

already in it, would you like to be added to DOE’s email database for updates relating to this 

rulemaking? 

1.2 We are assessing the impacts of a potential energy conservation standard on small 

businesses. Is your company a small business (defined as less than 750 employees by the US 

Small Business Administration (SBA), including all subsidiaries and parent companies, and 

employees in all countries where you operate)?

1.3 Are there any reasons that a small business manufacturer might be at a disadvantage 

relative to a larger business under amended energy conservation standards? Please consider such 

factors as technical expertise, access to capital, bulk purchasing power for materials/components, 

engineering resources, and any other relevant issues.

1.4 To your knowledge, are there any small businesses for which the adoption of amended 

energy conservation standards would have a particularly severe impact? If so, why? 

DOE explicitly analyzes the ten representative product classes listed in Table 1.1 below.5 DOE is 

currently considering between one and four efficiency levels (ELs) for each product class that 

correspond to higher ballast efficiency than the existing standards. In responding to this 

questionnaire, please refer to the ELs in the table below. DOE explains how it intends to 

determine the minimum efficiencies for the remaining product classes in the engineering chapter 

of the technical support document.6

 

 

5 When evaluating and establishing energy conservation standards, DOE divides covered products into classes by 

the type of energy used, capacity, or other performance-related features that affect efficiency, and factors such as the 

utility of the product to users. DOE then conducts its analysis and considers establishing or amending standards to 

provide separate standard levels for each product class. For ballasts, separate product classes are established based 

on lamp length, certain lamp diameters, ballast factor, lumen package, maximum number of lamps operated, certain 

start methods, and market sector.

6 Please see 

http://www1.eere.energy.gov/buildings/appliance_standards/residential/fluorescent_lamp_ballasts_ecs_prelim_tsd.h

tml for a complete description. 
13A-22

Table 1.1 Baseline and Efficiency Levels for Representative Product Classes

Number 

Designation Product Class Description EL BE 

(%)

1 

Two Lamp Normal BF 

4ft MBP 

IS & RS

T12 Electronic Baseline 81.0

T8 Single Voltage (Std Eff) Baseline / EL 1 86.0

T8 Universal (Std Eff) EL 2 90.0

T8 Universal (High Eff) EL 3 91.6

EL 4* 92.0

2 Two Lamp Normal BF 

4ft MBP PS

T8 (Std Eff) Baseline 84.3

T8 (High Eff) EL 1 89.1

EL 2* 90.2

3 Four Lamp Normal BF 4ft MBP IS & 

RS

T8 (Std Eff) Baseline 90.5

T8 (High Eff) EL 1 92.0

T8 Best in Market EL 2* 93.1

4 Four Lamp Normal BF 4ft MBP PS

T8 (Std Eff) Baseline 83.9

T8 (High Eff) EL 1 89.4

T8 Best in Market EL 2* 92.5

5 Two Lamp Normal BF 8ft SP Slimline

T12 Electronic Baseline - 

T8 (Std Eff) Baseline / EL 1 90.0

T8 (High Eff) EL 2 92.2

T8 Best in Market EL 3* 93.8

6 Two Lamp 8ft RDC HO IS & RS

T12 Magnetic Baseline - 

T12 Electronic EL 1 - 

T8 Electronic EL 2 - 

EL 3* - 

7 Two Lamp Normal BF 4ft T5 MiniBP 

SO

T5 Magnetic Baseline 79.1

T5 (Std Eff) EL 1 87.1

T5 Best in Market EL 2* 89.6

8 Two Lamp 4ft T5 MiniBP HO

T5 Magnetic Baseline 74.2

T5 (Std Eff) EL 1 87.8

T5 (High Eff) EL 2* 90.3

9 Two Lamp 4ft MBP IS & RS 

Residential

T12 Electronic Baseline 75.7

T8 (Std Eff) Baseline / EL 1 86.4

T8 (High Eff) EL 2 88.5

EL 3* 90.4

10 Four Lamp Sign Ballasts

T12 Magnetic Baseline - 

T12 Electronic EL 1 -

EL 2* - 

1.5 Do you agree with the ELs described in the table above? Do you suggest any 

modifications or additions? 
13A-23

2 KEY ISSUES

2.1 In general, what are the key issues for your company regarding amended energy 

conservation standards and this rulemaking? 

2.2 For the issues identified, how significant are they for each efficiency level?

2.3 Are any of the issues more or less significant for different product classes?

3 COMPANY OVERVIEW AND ORGANIZATIONAL CHARACTERISTICS

3.1 Do you have a parent company, and/or any subsidiaries relevant to the fluorescent lamp 

ballast industry?

3.2 What types of fluorescent lamp ballasts do you manufacture? Could you provide energy 

efficiency figures for those identified models? What is your company’s approximate market 

share of the fluorescent lamp ballast market? Does this vary significantly for any particular 

product class that you manufacture? 

3.3 Do you manufacture any products other than fluorescent lamp ballasts? If so, what other 

products do you manufacture? What percentage of your total manufacturing revenue corresponds 

to fluorescent lamp ballasts?

4 MARKUPS AND PROFITABILITY

One of the primary objectives of the MIA is to assess the impact of amended energy 

conservation standards on industry profitability. In this section, DOE would like to understand 

the current markup structure of the industry and how amended energy conservation standards 

would impact your company’s markup structure and profitability. 

DOE estimated the manufacturer production costs for ten representative product classes of 

fluorescent lamp ballasts. DOE defines manufacturer production cost as all direct costs 

associated with manufacturing a product: direct labor, direct materials, and overhead (which 

includes depreciation). The manufacturer markup is a multiplier applied to manufacturer 

production cost to cover non-production costs, such as SG&A and R&D, as well as profit. It 

does not reflect a “profit margin.” 

The manufacturer production cost times the manufacturer markup equals the manufacturer 

selling price. Manufacturer selling price is the price manufacturers charge their first customers, 

but does not include additional costs along the distribution channels. 

DOE estimated a baseline markup of 1.50 for fluorescent lamp ballasts. 
13A-24

4.1 Please comment on the baseline markup DOE calculated as compared to your company’s 

baseline markups for the fluorescent lamp ballast representative product classes. 

4.2 Please explain if profit levels vary by product class or product line. If yes, please indicate 

why. 

4.3 Because the market disruption caused by standards can alter the pricing of premium 

products, DOE is interested in understanding how margins currently change with efficiency. 

Within each product class, do markups vary by efficiency level? If yes, please provide 

information about the markups at higher efficiencies. 

4.4 Does your markup change with selected design options? Is the markup on incremental 

costs for more efficient designs different than the markup on the baseline models (as is assumed 

for retailer markups used in the analyses)?

4.5 Would you expect changes in your estimated profitability following an amended energy 

conservation standard? If so, please explain why. Can you suggest any scenarios that would 

model these expected changes?

5 FINANCIAL PARAMETERS

Navigant Consulting, Inc. has developed a “strawman” model of the fluorescent lamp ballast 

industry financial performance called the Government Regulatory Impact Model (GRIM) using 

publicly available data. However, this public information might not be reflective of 

manufacturing at the fluorescent lamp ballast profit center. This section attempts to understand 

the financial parameters for fluorescent lamp ballast manufacturing and how your company’s 

financial situation could differ from the industry aggregate picture. 

5.1 In order to accurately collect information about fluorescent lamp ballast manufacturing, 

please compare your financial parameters to the GRIM parameters tabulated below.

Table 5.1 Financial Parameters for Fluorescent Lamp Ballast Manufacturers

GRIM Input Definition

Industry 

Estimated

Value

Your Actual (If 

Significantly 

Different from 

DOE’s 

Estimate)

Income Tax Rate Corporate effective income tax paid (percentage 

of earnings before taxes, EBT) 27.6%

Discount Rate

Weighted average cost of capital (inflationadjusted weighted average of corporate cost of 

debt and return on equity)

7.0%

Working Capital Current assets less current liabilities (percentage 

of revenues) 8.3%

Net PPE Net plant property and equipment (percentage of 

revenues) 14.6%
13A-25

SG&A Selling, general, and administrative expenses 

(percentage of revenues) 19.4%

R&D Research and development expenses (percentage 

of revenues) 3.8%

Depreciation Amortization of fixed assets (percentage of 

revenues) 3.7%

Capital 

Expenditures

Outlay of cash to acquire or improve capital 

assets (percentage of revenues, not including 

acquisition or sale of business units)

4.2%

Cost of Goods 

Sold

Includes material, labor, overhead, and 

depreciation (percentage of revenues) 66.7%

5.2 Do any of the financial parameters in Table 5.1 change significantly based on product 

class? Please describe any differences. 

5.3 Do any of the financial parameters in Table 5.1 change for a particular subgroup of 

manufacturers? Please describe any differences. 

5.4 Would you expect an amended energy conservation standard to impact any of the 

financial parameters for your company?

6 CONVERSION COSTS

DOE understands that amended energy conservation standards may cause your company to incur 

capital and product conversion costs to redesign existing products and make changes to existing 

production lines. Understanding the nature and magnitude of the conversion costs is a critical 

portion of the MIA. Depending on their magnitude, the conversion costs can have a substantial 

impact on the outputs used by DOE to evaluate the industry impacts. The Manufacturer Impact 

Analysis considers two types of conversion costs: 

• Capital conversion costs are one-time investments in plant, property, and equipment 

(PPE) necessitated by an amended energy conservation standard. These may be 

incremental additions to existing PPE or the replacement of existing PPE. Included are 

expenditures on buildings, equipment, and tooling. 

• Product conversion costs are costs related to research, product development, testing, 

marketing and other costs for redesigning products necessitated by an amended energy 

conservation standard. 

 DOE seeks to understand the type (qualitative description) and magnitude (quantitative 

estimate) of the conversion expenditures that your company would expect to incur under the 

efficiency level scenarios described below. DOE recognizes that there are many variables and 

tradeoffs your company would ultimately need to consider in evaluating its conversion options 

under any of the below scenarios. DOE asks for your current best estimate of what your most 

likely path would be and what that path would cost. 
13A-26

In considering Table 6.1 below, your estimates should include all conversion 

expenditures associated with the ballast “product family” represented by given product classes. 

For example, Ref #1 represents all 2-lamp 4ft MBP low and high BF products, as well as the 

one-lamp products. 

 Depending on your manufacturing processes, it may be easier to group together certain 

product classes in the table below for the purposes of estimating expenditures (all 4ft MBP 

products, for example). DOE invites you to do so, if helpful. 

 

PRODUCT AND CAPITAL CONVERSION COSTS 

6.1 Looking at your high-volume product classes in Table 6.1, are there certain efficiency 

levels where the capital or product conversion costs significantly increase over the previous 

efficiency levels? Please describe these changes qualitatively.

6.2 Is there a typical cost required to upgrade a given product line (e.g., 2-lamp 4ft MBP, 

etc.)? 

6.3 Please provide estimates for your capital conversion costs by product class in Table 6.1

below. 

As an example, if the minimum energy efficiency level were set at EL2 for the Reference 

Product Class 1, all ballasts in this product class would have to be converted to this level. To 

complete this conversion, what changes to PPE would your company need to make to its 

production facility (e.g., number and type of new equipment; modifications to existing 

equipment)? What amount of capital expenditure would your company expect to incur as a 

result of these changes? 

6.4 Similarly, what level of product conversion costs would you expect to incur for each of 

efficiency levels for each product class? Do you outsource your product design operations or do 

keep them in-house? Please provide your estimates in Table 6.1 below considering such 

expenses as product development expenses, prototyping, testing, certification, and marketing. In 

the description column, please describe the assumptions behind the estimates provided. 
13A-27

 

Table 6.1 Product and Capital Conversion Costs for Representative Product Classes

Ref 

# Product Class EL BE+

(%)

Capital 

Conversion 

Cost

Description 

of Changes 

to PPE

Product 

Conversion 

Cost

Description 

(e.g., R&D, 

product 

development, 

etc.)

1 

Two Lamp 

Normal BF

4ft MBP IS & RS

Baseline 81.0 NA NA NA NA

Baseline / EL 1 86.0

EL 2 90.0

EL 3 91.6

EL 4* 92.0

2 

Two Lamp 

Normal BF

4ft MBP PS

Baseline 84.3 NA NA NA NA

EL 1 89.1

EL 2* 90.2

3 

Four Lamp 

Normal BF

4ft MBP IS & RS

Baseline 90.5 NA NA NA NA

EL 1 92.0

EL 2* 93.1

4 

Four Lamp 

Normal BF

4ft MBP PS

Baseline 83.9 NA NA NA NA

EL 1 89.4

EL 2* 92.5

5 

Two Lamp 

Normal BF

8ft SP Slimline

Baseline - NA NA NA NA

Baseline / EL 1 90.0

EL 2 92.2

EL 3* 93.8

6 

Two Lamp 8ft 

RDC HO

IS & RS

Baseline - NA NA NA NA

EL 1 - 

EL 2 - 
13A-28

Ref 

# Product Class EL BE+

(%)

Capital 

Conversion 

Cost

Description 

of Changes 

to PPE

Product 

Conversion 

Cost

Description 

(e.g., R&D, 

product 

development, 

etc.)

EL 3* - 

7 

Two Lamp 

Normal BF

4ft T5 MiniBP SO

Baseline 79.1 NA NA NA NA

EL 1 87.1

EL 2* 89.6

8 Two Lamp 4ft T5 

MiniBP HO

Baseline 74.2 NA NA NA NA

EL 1 87.8

EL 2* 90.3

9 

Two Lamp 4ft 

MBP IS & RS 

Residential

Baseline 75.7 NA NA NA NA

Baseline / EL 1 86.4

EL 2 88.5

EL 3* 90.4

10 Four Lamp Sign 

Ballasts

Baseline - NA NA NA NA

EL 1 - 

EL 2* - 

7 DIRECT EMPLOYMENT IMPACT ASSESSMENT

The impact of amended energy conservation standards on employment is an important 

consideration in the rulemaking process. 

7.1 Do you manufacturer any of your products domestically? 

7.2 Would your domestic employment levels be expected to change significantly under 

amended energy conservation standards? If so, please explain how and why they would change if 

higher efficiency levels are required.