RULEMAKING OVERVIEW AND PRELIMINARY MARKET 

AND TECHNOLOGY ASSESSMENT: 

ENERGY EFFICIENCY PROGRAM FOR CONSUMER 

PRODUCTS: 

Set-top Boxes and Network Equipment

January 2012

U.S. Department of Energy

Assistant Secretary

Office of Energy Efficiency and Renewable Energy

Building Technologies Program 

Appliances and Commercial Equipment Standards

Washington, DC 20585 
This Document was prepared for the Department of Energy

by staff members of

Lawrence Berkeley National Laboratory
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CHAPTER 1. INTRODUCTION

TABLE OF CONTENTS

1.1 SCOPE AND PURPOSE OF DOCUMENT ................................................................... 1-1

1.2 STRUCTURE OF DOCUMENT .................................................................................... 1-2
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LIST OF ACRONYMS

ACA American Cable Association

APD Auto Power Down

CA Conditional Access 

CEA Consumer Electronics Association 

CO2 Carbon dioxide 

DIF Digital Interoperability Forum 

DOCSIS Data Over Cable Service Interface Specification 

DOE Department of Energy

DSL Digital Subscriber Line 

DTA Digital Transport Adapter

DVR Digital Video Recorder

EPA Environmental Protection Agency 

FCC Federal Communications Commission

FM Frequency Modulation 

HD High Definition

HD-DVR High-Definition Digital Video Recorder

HEVC High Efficiency Video Coding 

HomePNA Home Phoneline Networking Alliance 

IP Internet Protocol 

IPTV Internet Protocol Television 

kWh Kilowatt-hours 

MoCA Multimedia over Coax Alliance

MSTV Association for Maximum Service Television 

NAB National Association of Broadcasters

NCTA National Cable and Telecommunications Association 

OTA Over the Air

OTT Over-the-top 

RUI Remote User Interface

SBCA Satellite Broadcasting and Communication Association 

SD Standard Definition 

SD-DVR Standard Definition Digital Video Record 

STB Set-Top Box 

TEC Total Energy Consumption (kWh/year) 

TWh Terawatt-hours (equal to 1 billion kWh) 

UEC Unit Energy Consumption 
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CHAPTER 1. INTRODUCTION

1.1 SCOPE AND PURPOSE OF DOCUMENT

The United States (U.S.) Department of Energy (DOE) Appliances and Commercial Equipment 

Standards Program, within the Office of Energy Efficiency and Renewable Energy (EERE)’s 

Building Technologies Program (BT), develops and promulgates test procedures and energy 

conservation standards for consumer appliances and commercial equipment. As a general matter, 

the process for developing standards involves analysis, public notice, and consultation with 

interested parties. 

Title III of the Energy Policy and Conservation Act (EPCA), as amended (42 U.S.C. 6291 et 

seq.), sets forth various provisions designed to improve energy efficiency. Part A of Title III of 

EPCA (42 U.S.C. 6291–6309) established the Energy Conservation Program for Consumer 

Products Other Than Automobiles,” which covers consumer products and certain commercial 

products (referred to as “covered products”)a

. In addition to specifying a list of covered 

residential and commercial products, EPCA contains provisions that enable the Secretary of 

Energy to classify additional types of consumer products as covered products. 

DOE recently published a Notice of Proposed Determination (76 FR 34914, June 15, 2011) 

(hereafter referred to as “proposed determination”) that preliminarily determined that set-top 

boxes (STBs) and network equipment meet the criteria for covered products because classifying 

products of such type as covered products is necessary or appropriate to carry out the purposes of 

EPCA, and the average U.S. household energy use for STBs and network equipment is likely to 

exceed 100 kilowatt-hours (kWh) per year. As a result, DOE has initiated test procedure and 

energy conservation standards rulemaking activities for STBs and network equipment. DOE may 

prescribe energy conservation standards if the product meets certain additional criteria, such as 

“average per household energy use within the United States” in excess of 150 kWh and 

“aggregate household energy use” in excess of 4.2 billion kWh, for any prior 12-month period. 

(42 U.S.C. 6295(l)(1)) 

This document is a stand-alone report that provides an overview of the rulemaking process for 

the benefit of interested parties, and provides a preliminary market and technology assessment 

for STBs. The preliminary assessments are subject to revision in future phases of the rulemaking 

process, and do not constitute a final assessment by DOE. 

 

a For editorial reasons, upon codification in the U.S. Code, Part B was re-designated Part A.
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1.2 STRUCTURE OF DOCUMENT 

The document is structured as follows: 

• Chapter 1: Introduction. 

• Chapter 2: Rulemaking and Analytical Overview. This chapter details the rulemaking 

process and how DOE generally seeks input from interested parties over the course of the 

rulemaking activity. This chapter also outlines all the stages of the analysis that DOE 

typically performs in support of energy conservation standards. 

• Chapter 3: Preliminary Market Assessment. This chapter provides an initial overview of

the current STB market, including major manufacturers, major service providers, annual 

shipments, installed base, average prices, and existing mandatory and voluntary 

regulatory programs. 

• Chapter 4: Preliminary Technology Assessment. This chapter provides an initial 

overview of the current technology used in STBs, unit and national energy consumption, 

and opportunities for energy reduction. The chapter also discusses potential product 

evolution in the near future. 

• Appendix. The appendix provides a list of definitions relevant to STBs. 
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CHAPTER 2. RULEMAKING AND ANALYTICAL OVERVIEW

TABLE OF CONTENTS

2.1 INTRODUCTION ........................................................................................................... 2-1

2.2 RULEMAKING PROCESS AND STAKEHOLDER PARTICIPATION ..................... 2-4

2.2.1 Notice of Proposed Rulemaking ...................................................................................... 2-5

2.2.2 Final Rule ......................................................................................................................... 2-6

2.3 MARKET AND TECHNOLOGY ASSESSMENT ........................................................ 2-6

2.3.1 Market Assessment .......................................................................................................... 2-6

2.3.2 Technology Assessment................................................................................................... 2-7

2.4 SCREENING ANALYSIS .............................................................................................. 2-7

2.5 ENGINEERING ANALYSIS .......................................................................................... 2-7

2.6 MARKUPS ANALYSIS ................................................................................................. 2-8

2.7 ENERGY USE ANALYSIS ............................................................................................ 2-9

2.8 LIFE-CYCLE COST AND PAYBACK PERIOD ANALYSIS ..................................... 2-9

2.9 SHIPMENTS ANALYSIS ............................................................................................ 2-10

2.10 NATIONAL IMPACT ANALYSIS .............................................................................. 2-10

2.10.1 National Energy Savings................................................................................................ 2-11

2.10.2 Net Present Value of Consumer Benefit ........................................................................ 2-11

2.11 CONSUMER SUBGROUP ANALYSIS ...................................................................... 2-12

2.12 MANUFACTURER IMPACT ANALYSIS.................................................................. 2-12

2.13 EMPLOYMENT IMPACT ANALYSIS ....................................................................... 2-12

2.14 UTILITY IMPACT ANALYSIS ................................................................................... 2-13

2.15 EMISSIONS ANALYSIS .............................................................................................. 2-13

2.16 MONETIZING CARBON DIOXIDE AND OTHER EMISSIONS IMPACTS ........... 2-15

2.16.1 Social Cost of Carbon .................................................................................................... 2-15

2.16.1.1 Monetizing Carbon Dioxide Emissions ....................................................... 2-15

2.16.1.2 Social Cost of Carbon Values Used in Past Regulatory Analyses ............... 2-17

2.16.1.3 Current Approach and Key Assumptions .................................................... 2-18

2.16.2 Valuation of Other Emissions Reductions ..................................................................... 2-20

2.17 REGULATORY IMPACT ANALYSIS ....................................................................... 2-20

LIST OF FIGURES

Figure 2.1.1 Flow Diagram of Analyses for the Rulemaking Process ..................................... 2-2
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CHAPTER 2. RULEMAKING AND ANALYTICAL OVERVIEW

2.1 INTRODUCTION

The purpose of this chapter is to provide an overview of the rulemaking process and to describe 

the procedural and analytical approaches that DOE anticipates using to evaluate energy 

conservation standards for STBs and network equipment. This chapter is also intended to inform 

interested parties of the process of the standards rulemaking for STBs and network equipment 

and to encourage and facilitate stakeholder input during the rulemaking. It should be noted that 

this chapter is merely the starting point for developing standards and is not a definitive statement 

with respect to any issue to be determined in the rulemaking. 

Section 6295(o)(2)(A) of 42 U.S.C. requires DOE to set forth energy conservation standards that 

are technologically feasible and economically justified and would result in significant additional 

energy conservation. The analytical framework is a description of the methodology, the 

analytical tools, and relationships among the various analyses that are part of this rulemaking. 

This chapter discusses the analysis DOE intends to conduct to fulfill the statutory requirements 

and guidance for this standards rulemaking. For example, the methodology that addresses the 

statutory requirement for economic justification includes analyses of life-cycle cost; economic 

impact on manufacturers and users; national benefits; impacts, if any, on utility companies; and 

impacts, if any, from lessening competition among manufacturers. Information regarding this 

rulemaking will be maintained on the DOE website at:

http://www.eere.energy.gov/buildings/appliance_standards/

Figure 2.1.1 summarizes the analytical components of the standards-setting process. The focus of 

this figure is the center column, identified as “Analyses.” The columns labeled “Key Inputs” and 

“Key Outputs” show how the analyses fit into the rulemaking process, and how the analyses 

relate to each other. Key inputs are the types of data and information that the analyses require. 

Some key inputs exist in public databases; DOE collects other inputs from stakeholders or 

persons with special knowledge. Key outputs are analytical results that feed directly into the 

standards-setting process. Lines connecting analyses show types of information that feed from 

one analysis to another. In general, the key outputs of each stage of the analysis become key 

inputs for the subsequent stages of analysis. 
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Figure 2.1.1 Flow Diagram of Analyses for the Rulemaking 

Process
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The analyses performed and reported as part of the rulemaking process include: 

• A market and technology assessment to characterize the relevant markets and existing 

technology options, including prototype designs. 

• A screening analysis to review each technology option to decide whether it is 

technologically feasible; is practicable to manufacture, install, and service; would 

adversely affect product utility or product availability; or would have adverse impacts on 

health and safety.

• An engineering analysis to develop cost-efficiency relationships that indicate the 

manufacturer’s cost of achieving increased efficiency. 

• A markups analysis to develop distribution channel markups that relate the manufacturer 

production cost (MPC) to the cost to the consumer. 

• An analysis of the annual energy use of the considered products. 

• Life-cycle cost (LCC) and payback period (PBP) analyses to calculate, at the consumer 

level, the savings in operating costs (minus maintenance and repair costs) throughout the 

estimated average lifetime of the considered products, compared to any increase in 

purchase and installation cost likely to result from increased energy efficiency. 

• A shipments analysis to forecast shipments of the considered products, which are then 

used to calculate the national impacts of standards on energy and net present value 

(NPV).

• A national impact analysis (NIA) to assess aggregate impacts at the national level of 

potential energy conservation standards for the considered products, as measured by the 

national energy savings (NES) and net present value (NPV) of total consumer economic 

impacts.

• A manufacturer impact analysis (MIA) to assess the potential impacts of energy 

conservation standards on manufacturers’ capital conversion expenditures, marketing 

costs, shipments, and research and development costs. 

• An environmental assessment (EA) to analyze the potential reduction in power plant 

emissions of CO2, NOX and Hg resulting from reduced consumption of electricity 

associated with energy savings from the considered products. 

• A monetization of emissions reduction benefits to estimate the monetary value of benefits 

resulting from reduced emissions of CO2 and NOX. 

Section 2.2 provides an overview of the rulemaking process. The analyses are described in more 

detail in sections 2.3 to 2.17. 
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2.2 RULEMAKING PROCESS AND STAKEHOLDER PARTICIPATION

When DOE evaluates any new or amended energy conservation standard for “covered products” 

under EPCA, the statute, as amended, specifies that any standard DOE prescribes for consumer 

products shall be designed to “achieve the maximum improvement in energy efficiency. . . which 

the Secretary [of Energy] determines is technologically feasible and economically justified.” (42 

U.S.C. 6295(o)(2)(A)) Moreover, EPCA states that the Secretary may not establish an amended 

standard if such standard would not result in “significant conservation of energy,” or “is not 

technologically feasible or economically justified.” (42 U.S.C. 6295(o)(3)(B)) In determining 

whether a standard is economically justified, DOE considers, to the greatest extent practicable, 

the following seven factors: 

1) The economic impact of the standard on the manufacturers and on the consumers of the 

products subject to such standard; 

2) The savings in operating costs throughout the estimated average life of the covered 

products in the type (or class) compared to any increase in the price, or in the initial 

charges for, or maintenance expenses of the covered products which are likely to result 

from the imposition of the standard; 

3) The total projected amount of energy (or as applicable, water) savings likely to result 

directly from the imposition of the standard; 

4) Any lessening of the utility or the performance of the covered products likely to result 

from the imposition of the standard; 

5) The impact of any lessening of competition, as determined in writing by the Attorney 

General, that is likely to result from the imposition of the standard;

6) The need for national energy and water conservation; and 

7) Other factors the Secretary considers relevant.

(42 U.S.C. 6295(o)(2)(B)(i) and 42 U.S.C. 6316(a)) 

Additional statutory requirements for prescribing new or amended standards are set forth in 42 

U.S.C. 6295(o)(1)–(2)(A), (2)(B)(ii)(iii), and (3)–(5); 42 U.S.C. 6316(a). 

The process for developing efficiency standards involves analysis, public notice, and 

consultation with interested parties. Such parties (collectively referred to as stakeholders) 

generally include manufacturers, consumers, energy conservation and environmental advocates, 

State and Federal agencies, and any other groups or individuals with an interest in energy 

conservation standards and test procedures. DOE considers stakeholder participation to be a very 

important part of the rulemaking process. Accordingly, DOE actively encourages the 

participation and interaction of all stakeholders during the comment period provided at each 

stage of the rulemaking. The broad array of stakeholders who routinely provide comments 

promotes a balanced discussion of critical information required to conduct the standards 

rulemaking. 

In conducting the test procedure rulemakings and the energy (and water) conservation standards 

rulemakings, DOE involves stakeholders through a variety of means, including formal public 

notifications (i.e., Federal Register notices) and public meetings. As discussed in further detail 
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below, DOE anticipates the standards rulemaking process for STBs and network equipment to 

involve two major public notices, which will be published in the Federal Register:

• Notice of proposed rulemaking (NOPR). The NOPR will present: (a) a discussion of 

select comments received in response to any Request for Information (RFI); (b) the 

analysis of the impacts of standards on consumers, manufacturers, and the nation; (c) 

DOE’s weighting of the impacts; and (d) the proposed standard levels for public 

comment.

• Final rule (see section 1.5). The final rule will present: (a) a discussion of comments 

received in response to the NOPR; (b) the revised analysis of the impacts of standards; 

(c) DOE’s weighting of the impacts; and (d) the standard levels DOE is adopting. The 

final rule also establishes the compliance dates of the standards.

In addition, DOE will publish in the Federal Register a final determination of STBs and network 

equipment as a covered consumer product. The final determination will present: (a) a final 

definition of the covered products; and (b) responses to comments received from the proposed 

determination (76 FR 34914, June 15, 2011). 

2.2.1 Notice of Proposed Rulemaking 

In developing the NOPR, DOE will first review and consider all the comments it received in 

response to any prior RFI. DOE will conduct complete engineering, economic, and 

environmental impact analyses at this stage of the rulemaking. These analyses generally include 

a consumer LCC subgroup analysis, a complete manufacturer impact analysis, a utility impact 

analysis, an employment impact analysis, an environmental assessment, and a regulatory impact 

analysis. See below for a description of these analyses.

DOE will describe the methodology used and make the results of all the analyses available on its 

website for review and comments. Based on comments by stakeholders, further revisions to the 

analysis may be undertaken. This analytical process ends with the selection of proposed standard 

levels (if any) that DOE will present in the NOPR. DOE selects the proposed standard levels 

from the trial standard levels (TSLs) analyzed during the NOPR phase of the rulemaking. The 

NOPR, published in the Federal Register, will document the evaluation and selection of any 

proposed standards levels, along with a discussion of other TSLs considered but not selected 

(and the reasons for not selecting them). 

The selection process for proposed efficiency standards generally runs as follows. For each 

product class, DOE will identify the maximum improvement in energy efficiency or maximum 

reduction in energy use that is technologically feasible. If DOE proposes a level that is below 

this maxtech level, it will sequentially explain the reasons for eliminating higher levels, 

beginning with the highest level considered. DOE will present the analysis results in the NOPR, 

with the details of the analysis provided in an accompanying Technical Support Document 

(TSD).
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DOE considers many factors in selecting proposed standards, as described above in section 2.2. 

These factors and criteria are established by EPCA and take into account the many benefits, 

costs, and impacts of energy conservation standards. Additionally, DOE encourages 

stakeholders to develop joint recommendations for standard levels. DOE will carefully consider 

such recommendations in its decision process. 

When DOE publishes the NOPR, it will provide the U.S. Department of Justice (DOJ) with a 

copy of the NOPR and TSD, in order to solicit feedback on the impact of the proposed standard 

levels on competition. DOJ will review these standard levels in light of any lessening of 

competition that is likely to result from the imposition of standards. (42 U.S.C. 

6295(o)(2)(B)(i)(V) and (B)(ii)) DOE will consider DOJ’s determination on the impacts of the 

proposed standard on competition in preparing the final rule. The NOPR is followed by a public 

comment period that includes one public meeting. DOE anticipates the comment period to be 50 

days for STBs and network equipment. 

2.2.2 Final Rule

After the publication of the NOPR, DOE will consider public comments it receives on the 

proposal (including TSLs) and accompanying analyses. On the basis of the public comments, 

DOE will review the engineering and economic impact analyses and proposed standards and 

make modifications as necessary. In addition, before it issues the final rule, DOE will consider 

DOJ’s comments on the NOPR relating to the impacts of the proposed standard levels on 

competition, to determine whether changes to these standard levels are needed.

The standards rulemaking will conclude with the publication of the final rule. DOE will select 

the final standard levels based on the complete record of the standards rulemaking. The final rule 

will promulgate the final standard levels and their compliance date and explain the basis for their 

selection. The final rule will be accompanied by a final TSD.

2.3 MARKET AND TECHNOLOGY ASSESSMENT

The market and technology assessment characterizes the relevant product markets and existing 

technology options, including prototype designs, for STBs and network equipment. 

2.3.1 Market Assessment

When initiating a standards rulemaking, DOE develops information on the present and past 

industry structure and market characteristics for the products concerned. This activity assesses 

the industry and products, both quantitatively and qualitatively, based on publicly available 

information. As such, for the considered products, DOE will address the following: (1) 

manufacturer market share and characteristics; (2) existing regulatory and non-regulatory 

product efficiency improvement initiatives; and (3) trends in product characteristics and retail 

markets. This information serves as resource material throughout the rulemaking. 
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DOE reviews existing literature and interview manufacturers to get an overall picture of the 

markets for the considered products in the United States. Industry publications and trade 

journals, market research firms, government agencies, and trade organizations provide the bulk 

of the information, including information on: (1) manufacturers and their market share; (2) 

shipments by capacity; and (3) market saturation. DOE uses the most reliable and accurate data 

available at the time of each analysis in the rulemaking. All data will be available for public 

review.

2.3.2 Technology Assessment

DOE typically uses information relating to existing and past technology options and prototype 

designs as inputs to determine what technologies manufacturers use to attain higher performance 

levels. In consultation with stakeholders, DOE develops a list and description of technologies 

for consideration for possible increases in energy efficiency of future products. Initially, these 

technologies encompass all those DOE believes are technologically feasible.

DOE also develops its list of technologically feasible design options through consultation with 

industry analysts and manufacturers of components and systems, and from trade publications and 

technical papers. Since many options for improving product efficiency are available in existing 

units, product literature and direct examination provide additional information. 

2.4 SCREENING ANALYSIS

The screening analysis examines various technologies as to whether they: (1) are technologically 

feasible; (2) are practicable to manufacture, install, and service; (3) have an adverse impact on 

product utility or availability; and (4) have adverse impacts on health and safety. As described in 

section 2.3.2 above, DOE develops an initial list of efficiency-enhancement options from the 

technologies identified as technologically feasible in the technology assessment. Then DOE, in 

consultation with interested parties, reviews the list to determine if these options are practicable 

to manufacture, install, and service, would adversely affect product utility or availability, or 

would have adverse impacts on health and safety. In addition, DOE removes from the list 

technology options that lack energy consumption data as well as technology options whose 

energy consumption cannot be adequately measured by existing DOE test procedures. In the 

engineering analysis, DOE further considers efficiency enhancement options that it did not 

screen out in the screening analysis.

2.5 ENGINEERING ANALYSIS 

The engineering analysis establishes the relationship between the manufacturing production cost 

(MPC) and the efficiency for each class of STB and network equipment. This relationship serves 

as the basis for cost/benefit calculations in terms of individual consumers, manufacturers, and the 

nation. The engineering analysis discusses the product classes DOE analyzes, the representative 

baseline units, the incremental efficiency levels, the methodology DOE uses to develop the 
2-8

manufacturing production costs, the cost-efficiency curves, the projected impact of efficiency 

improvements on the considered products, and the methodology DOE uses to extend the analysis 

to low-shipment-volume product classes. 

In the engineering analysis, DOE evaluates a range of product efficiency levels and their 

associated manufacturing costs. The purpose of the analysis is to estimate the incremental MPCs 

for a product that would result from increasing efficiency levels above the level of the baseline 

model in each product class. The engineering analysis considers technologies not eliminated in 

the screening analysis, although certain technologies are not analyzed due to negligible 

incremental efficiency improvements or the inability of existing DOE test procedures to measure 

any reduction in energy use. DOE considers the remaining technologies, designated as design 

options, in developing the cost-efficiency curves, which are subsequently used for the LCC and 

PBP analyses.

DOE typically structures its engineering analysis around one of three methodologies: (1) the 

design-option approach, which calculates the incremental costs of adding specific design options 

to a baseline model; (2) the efficiency-level approach, which calculates the relative costs of 

achieving increases in energy efficiency levels without regard to the particular design options 

used to achieve such increases; and/or (3) the reverse-engineering or cost-assessment approach, 

which involves a “bottom-up” manufacturing cost assessment based on a detailed bill of 

materials derived from tear-downs of the product being analyzed. 

Combinations of these approaches involve physically disassembling commercially available 

products, consulting with outside experts, reviewing publicly available cost and performance 

information, and modeling equipment cost. The efficiency levels that DOE considers in the 

engineering analysis are attainable using technologies currently available on the market or have 

been demonstrated in working prototypes. In addition, DOE associates some of the efficiency 

levels with specific technologies that manufacturers might use to provide interested parties with 

additional transparency of assumptions and results and the ability to perform independent 

analyses for verification. 

2.6 MARKUPS ANALYSIS

DOE uses markups to convert the manufacturer costs estimated in the engineering analysis to 

consumer prices, which are then used in the LCC and PBP, and manufacturer impact analyses. 

To develop markups, DOE identifies how the products are distributed from the manufacturer to 

the customer. DOE calculates markups for baseline products (baseline markups) and for more 

efficient products (incremental markups). The incremental markup relates the change in the 

manufacturer sales price of higher-efficiency models (the incremental cost increase) to the 

change in the retailer or distributor sales price.
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2.7 ENERGY USE ANALYSIS

The energy use analysis, which assesses the energy savings potential from higher efficiency 

levels, provides the basis for the energy savings values used in the LCC and subsequent analyses. 

The goal of the energy use analysis is to generate a range of energy use values that reflects actual 

product use in American homes. The analysis uses information on use of actual products in the 

field to estimate the energy that would be used by new products at various efficiency levels. 

Measurements of field energy use often vary considerably from the rated usage as determined by 

the DOE test procedure. To determine the field energy use by products that would meet possible 

energy efficiency standards, DOE generally uses data for a wide range of households. An 

example of such data might include a national sample survey of housing units that collects 

statistical information on the consumption of and expenditures for energy in housing units along 

with data on energy-related characteristics of the housing units and occupants. 

2.8 LIFE-CYCLE COST AND PAYBACK PERIOD ANALYSIS

New energy conservation standards affect products’ operating expenses—usually decreasing 

them—and consumer prices for the products—usually increasing them. DOE analyzes the effect 

of imposing standards on consumers by evaluating changes in the LCC of owning and operating 

the product. To evaluate the change in LCC, DOE uses the cost-efficiency relationship derived in 

the engineering analysis, along with the usage derived from the energy use analysis. Inputs to the 

LCC calculation include the purchase price of a product, energy expenses associated with 

operating the product, the lifetime of the unit, and a discount rate. 

Because the installed cost of a product typically increases while operating cost typically 

decreases in response to new standards, there is a time in the life of products having higher-thanbaseline efficiency when the net operating-cost benefit (in dollars) since the time of purchase is 

equal to the incremental first cost of purchasing the higher-efficiency product. The length of time 

required for products to reach this cost-equivalence point is known as the payback period (PBP). 

Recognizing that several inputs to the determination of consumer LCC and PBP are either 

variable or uncertain, DOE conducts the LCC and PBP analysis by modeling both the 

uncertainty and variability in the inputs using Monte Carlo simulation and probability 

distributions. DOE develops LCC and PBP spreadsheet models incorporating both Monte Carlo 

simulation and probability distributions by using Microsoft Excel spreadsheets combined with 

Crystal Ball (a commercially available add-in program).

As described above in section 2.7, DOE develops samples of individual households that use the 

considered product. DOE is able to perform the LCC and PBP calculations for each household to 

account for the variability in energy consumption and electricity price associated with actual 

users of the considered product. DOE identifies several other input values for estimating the 

LCC, including retail prices, discount rates, and product lifetime. DOE characterizes discount 

rates and product lifetime with probability distributions. 
2-10

DOE develops discount rates for residential consumers from estimates of the interest rate, or 

finance cost, applied to purchases of residential products. Following accepted principles of 

financial theory, the finance cost of raising funds to purchase such products can be interpreted as: 

(1) the financial cost of any debt incurred to purchase products, principally interest charges on 

debt; or (2) the opportunity cost of any equity used to purchase products, principally interest 

earnings on household equity. 

DOE considers installation, maintenance and repair costs for the efficiency levels considered in a 

rulemaking. Typically, small incremental changes in energy efficiency produce no, or only 

minor, changes in repair and maintenance costs over baseline efficiency products. Products 

having efficiencies that are significantly greater than baseline models can incur increased repair 

and maintenance costs, as they are more likely to incorporate technologies that are new to the 

industry. 

2.9 SHIPMENTS ANALYSIS

Forecasts of product shipments are needed to calculate the national impacts of standards on 

energy use and NPV, and future manufacturer cash flows. DOE develops shipment forecasts 

based on an analysis of key market drivers for each considered product. In DOE’s shipments 

model, shipments of products are driven by new housing construction, stock replacements, and 

other types of purchases. 

The shipments models take an accounting approach, tracking market shares of each product class 

and the vintage of units in the existing stock. Stock accounting uses product shipments as inputs 

to estimate the age distribution of in-service product stocks for all years. The age distribution of 

in-service product stocks is a key input to calculations of both the NES and NPV, because 

operating costs for any year depend on the age distribution of the stock. 

DOE also considers the impacts on shipments from changes in product purchase price and 

operating cost associated with higher energy efficiency levels. 

2.10 NATIONAL IMPACT ANALYSIS

The national impact analysis assesses the aggregate impacts at the national level of potential 

energy conservation standards for the considered products, as measured by the NPV of total 

consumer economic impacts and the NES. DOE determines the NPV and NES for the efficiency 

levels considered for each of the product classes analyzed. To make the analysis more accessible 

and transparent to all interested parties, DOE prepares a Microsoft Excel spreadsheet model to 

forecast NES and the national consumer economic costs and savings resulting from new 

standards. The spreadsheet model uses typical values as inputs (as opposed to probability 

distributions). To assess the effect of input uncertainty on NES and NPV results, DOE may 

conduct sensitivity analyses by running scenarios on specific input variables. 
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Several of the inputs for determining NES and NPV depend on the forecast trends in product 

energy efficiency. For the base case (which presumes no standards), DOE uses the efficiency 

distributions developed for the LCC analysis, and assumes some rate of change over the forecast 

period. DOE typically uses a roll-up scenario in developing its forecasts of efficiency trends after 

standards take effect. Under a roll-up scenario, all products that perform at levels below a 

prospective standard are moved, or rolled-up, to the minimum performance level allowed under 

the standard. Product efficiencies above the standard level under consideration would remain the 

same as before the standard takes effect.

2.10.1 National Energy Savings 

The inputs for determining the NES for each product analyzed are: (1) annual energy 

consumption per unit; (2) shipments; (3) product stock; (4) national energy consumption; and (5) 

site-to-full-fuel-cycle conversion factors. DOE calculates the national energy consumption by 

multiplying the number of units, or stock, of each product (by vintage, or age) by the unit energy 

consumption (also by vintage). DOE calculates annual NES based on the difference in national 

energy consumption for the base case (without new efficiency standards) and for each higher 

efficiency standard. DOE estimates energy consumption and savings based on site energy, and 

converts the electricity consumption and savings to full-fuel cycle energy. Cumulative energy 

savings are the sum of the NES for each year in the forecast period. 

2.10.2 Net Present Value of Consumer Benefit

The inputs for determining NPV of the total costs and benefits experienced by consumers of the 

considered products are: (1) total annual installed cost; (2) total annual savings in operating 

costs; (3) a discount factor; (4) present value of costs; and (5) present value of savings. DOE 

calculates net savings each year as the difference between the base case and each standards case 

in total savings in operating costs and total increases in installed costs. DOE calculates savings 

over the life of each product. NPV is the difference between the present value of operating cost 

savings and the present value of total installed costs. DOE typically uses a discount factor based 

on real discount rates of 3% and 7% to discount future costs and savings to present values. 

DOE calculates increases in total installed costs as the difference in total installed cost between 

the base case and standards case (i.e., once the standards take effect). Because the more efficient 

products bought in the standards case usually cost more than products bought in the base case, 

cost increases appear as negative values in the NPV. DOE expresses savings in operating costs as 

decreases associated with the lower energy consumption of products bought in the standards case 

compared to the base efficiency case. Total savings in operating costs are the product of savings 

per unit and the number of units of each vintage that survive in a given year. 

In addition to calculating the NPV of consumer benefit, DOE calculates a benefit that combines 

the NPV of the consumer savings, calculated for each efficiency level using 3% and 7% discount 

rates, with the present value of the potential economic benefits resulting from reduced CO2 and 

NOX emissions. See sections 2.15 and 2.16 for a discussion of the emissions analysis and 

monetization of emissions reduction. 
2-12

2.11 CONSUMER SUBGROUP ANALYSIS

The consumer subgroup analysis evaluates economic impacts on selected groups of consumers 

who might be adversely affected by a change in the national energy conservation standards for 

the considered products. DOE evaluates impacts on particular subgroups of consumers primarily 

by analyzing the LCC impacts and PBP for those particular consumers using the LCC 

spreadsheet model. 

DOE typically analyzes the following subgroups: (1) low-income households; and (2) 

households solely occupied by senior citizens. 

2.12 MANUFACTURER IMPACT ANALYSIS

The MIA assesses the impacts of new energy conservation standards on manufacturers of the 

considered products. Potential impacts include financial effects, both quantitative and qualitative, 

that might lead to changes in the manufacturing practices for these products. DOE identifies 

these potential impacts through interviews with manufacturers and other interested parties.

DOE typically conducts the MIA in three phases, and further tailors the analytical framework 

based on interested parties’ comments. In Phase I, an industry profile is created to characterize 

the industry, and a preliminary MIA is conducted to identify important issues that require 

consideration. In Phase II, an industry cash flow model and an interview questionnaire are 

prepared to guide subsequent discussions. In Phase III, manufacturers are interviewed, and the 

impacts of standards are assessed both quantitatively and qualitatively. Industry and subgroup 

cash flow and NPV are assessed through use of the Government Regulatory Impact Model 

(GRIM). Then impacts on competition, manufacturing capacity, employment, and cumulative 

regulatory burden are assessed based on manufacturer interview feedback and discussions. 

2.13 EMPLOYMENT IMPACT ANALYSIS

New energy conservation standards can impact employment both directly and indirectly. Direct 

employment impacts are changes in the number of employees at the plants that produce the 

covered products, and at the affiliated distribution and service companies, resulting from the 

adoption of new standards. DOE evaluates direct employment impacts in the MIA. Indirect 

employment impacts may result from expenditures shifting between goods (the substitution 

effect) and changes in income and overall expenditure levels (the income effect) that occur due 

to the adoption of standards. 

DOE typically investigates the combined direct and indirect employment impacts of standards 

using the Pacific Northwest National Laboratory (PNNL)’s “Impact of Sector Energy 

Technologies” (ImSET) model. The ImSET model, which was developed for DOE’s Office of 

Planning, Budget, and Analysis, estimates the employment and income effects energy-saving 

technologies produced in buildings, industry, and transportation. In comparison with simple 
2-13

economic multiplier approaches, ImSET allows for more complete and automated analysis of the 

economic impacts of energy conservation investments. 

2.14 UTILITY IMPACT ANALYSIS

The utility impact analysis estimates the effects of energy conservation standards on installed 

electricity generation capacity and electricity generation. DOE typically adapts NEMS, which is 

a large multi-sectoral, partial-equilibrium model of the U.S. energy sector that the Energy 

Information Administration (EIA) has developed throughout the past decade, primarily for 

preparing EIA’s Annual Energy Outlook (AEO). In previous rulemakings, a variant of NEMS 

(currently termed NEMS-BT, BT referring to DOE’s Building Technologies Program), was 

developed to better address the specific impacts of an energy conservation standard. NEMS, 

which is available in the public domain, produces a widely recognized baseline energy forecast 

for the United States. The typical NEMS outputs include forecasts of electricity and natural gas 

sales, prices, and electric generating capacity.

DOE conducts the utility impact analysis as a scenario that departs from the latest AEO reference 

case. In other words, the energy savings impacts from amended energy conservation standards 

are modeled using NEMS-BT to generate forecasts that deviate from the AEO reference case.

2.15 EMISSIONS ANALYSIS

In the emissions analysis, DOE estimates the reduction in power sector emissions of carbon 

dioxide (CO2), nitrogen oxides (NOX), and mercury (Hg) from potential energy conservation 

standards. DOE uses the NEMS-BT computer model, which is run similarly to the AEO NEMS

model, except that product energy use is reduced by the amount of energy saved (by fuel type) at 

each TSL. The inputs of national energy savings come from the NIA spreadsheet model, while 

the output is the forecasted physical emissions. The net benefit of each TSL is the difference 

between the forecasted emissions estimated by NEMS-BT at each TSL and the AEO Reference 

Case. NEMS-BT tracks CO2 emissions using a detailed module that provides results with broad 

coverage of all sectors and inclusion of interactive effects. For the NOPR, DOE intends to use 

the version of NEMS-BT based on latest AEO release, which incorporates projected effects of all 

emissions regulations promulgated as of its release date. For the final rule, DOE intends to revise 

the emissions analysis, if necessary, using the most current version of NEMS-BT.

SO2 emissions from affected electric generating units (EGUs) are subject to nationwide and 

regional emissions cap-and-trade programs, and DOE has preliminarily determined that these 

programs create uncertainty about the impact of potential energy conservation standards on SO2

emissions. Title IV of the Clean Air Act sets an annual emissions cap on SO2 for affected EGUs 

in the 48 contiguous States and the District of Columbia (D.C.). SO2 emissions from 28 eastern 

States and D.C. are also limited under the Clean Air Interstate Rule (CAIR; 70 FR 25162 (May 

12, 2005)), which created an allowance-based trading program. Although CAIR was remanded 

to EPA by the U.S. Court of Appeals for the District of Columbia Circuit (D.C. Circuit) (see 

North Carolina v. EPA, 550 F.3d 1176 (D.C. Cir. 2008)), it remained in effect temporarily, 
2-14

consistent with the D.C. Circuit’s earlier opinion in North Carolina v. EPA, 531 F.3d 896 (D.C. 

Cir. 2008). On July 6, 2010, EPA issued the Transport Rule proposal, a replacement for CAIR. 

75 FR 45210 (Aug. 2, 2010). On July 6, 2011 EPA issued the final Transport Rule, titled the 

Cross-State Air Pollution Rule. 76 FR 48208 (August 8, 2011). (See 

http://www.epa.gov/crossstaterule/). AEO 2011 NEMS assumes the implementation of CAIR, 

although future iterations of the NEMS-BT model will incorporate any changes necessitated by 

issuance of the Transport Rule. 

The attainment of emissions caps is typically flexible among EGUs and is enforced through the 

use of emissions allowances and tradable permits. Under existing EPA regulations, any excess 

SO2 emissions allowances resulting from the lower electricity demand caused by the imposition 

of an efficiency standard could be used to permit offsetting increases in SO2 emissions by any

regulated EGU. However, if potential energy conservation standards resulted in a permanent 

increase in the quantity of unused emissions allowances, there would be an overall reduction in 

SO2 emissions from the standards. While there remains some uncertainty about the ultimate 

effects of efficiency standards on SO2 emissions covered by the existing cap-and-trade system, 

the NEMS-BT modeling system that DOE uses to forecast emissions reductions currently 

indicates that no physical reductions in power sector emissions would occur for SO2. 

As discussed above, the AEO 2011 NEMS assumes the implementation of CAIR, which 

established a cap on NOX emissions in 28 eastern States and the District of Columbia. With 

CAIR in effect, energy conservation standards are typically expected to have little or no physical 

effect on NOX emissions in those States covered by CAIR, for the same reasons that they may 

have little effect on SO2 emissions. However, potential energy conservation standards would be 

expected to reduce NOX emissions in the 22 States not affected by CAIR. For these 22 States, 

DOE uses the NEMS-BT to estimate NOX emissions reductions from potential energy 

conservation standards. 

Similar to emissions of SO2 and NOX, future emissions of Hg would have been subject to 

emissions caps. In May 2005, EPA issued the Clean Air Mercury Rule (CAMR). 70 FR 28606 

(May 18, 2005). CAMR would have permanently capped emissions of mercury for new and 

existing coal-fired power plants in all states by 2010. However, on February 8, 2008, the D.C. 

Circuit issued a decision in New Jersey v. Environmental Protection Agency, 517 F.3d 574 (D.C. 

Cir. 2008), in which it vacated CAMR. EPA has decided to develop emissions standards for 

power plants under Section 112 of the Clean Air Act, consistent with the DC Circuit’s opinion 

on CAMR. See http://www.epa.gov/air/mercuryrule/pdfs/certpetition_withdrawal.pdf. Pending 

EPA’s forthcoming revisions to the rule, DOE is excluding CAMR from its emissions 

assessment. In the absence of CAMR, a potential energy conservation standard would likely 

reduce Hg emissions and DOE uses NEMS-BT to estimate these reductions. However, DOE 

continues to review the impact of rules that reduce energy consumption on Hg emissions, and 

may revise its assessment of Hg emission reductions in the future.
2-15

2.16 MONETIZING CARBON DIOXIDE AND OTHER EMISSIONS IMPACTS 

As part of the development of a potential energy conservation standard, DOE considers the 

estimated monetary benefits likely to result from the reduced emissions of CO2 and NOX that are 

expected to result from each of the TSLs considered. In order to make this calculation similar to 

the calculation of the NPV of consumer benefit, DOE considers the reduced emissions expected 

to result over the lifetime of products shipped in the forecast period for each TSL. This section 

summarizes the basis for the monetary values used for each of these emissions. 

DOE relies on a set of values for the social cost of carbon (SCC) that was developed by an 

interagency process. A summary of the basis for these values is provided below. 

2.16.1 Social Cost of Carbon 

Under section 1(b) of Executive Order 12866, agencies must, to the extent permitted by law, 

“assess both the costs and the benefits of the intended regulation and, recognizing that some 

costs and benefits are difficult to quantify, propose or adopt a regulation only upon a reasoned 

determination that the benefits of the intended regulation justify its costs.” The purpose of the 

SCC estimates presented here is to allow agencies to incorporate the monetized social benefits of 

reducing CO2 emissions into cost-benefit analyses of regulatory actions that have small, or 

“marginal,” impacts on cumulative global emissions. The estimates are presented with an 

acknowledgement of the many uncertainties involved and with a clear understanding that they 

should be updated over time to reflect increasing knowledge of the science and economics of 

climate impacts.

As part of the interagency process that developed these SCC estimates, technical experts from 

numerous agencies met on a regular basis to consider public comments, explore the technical 

literature in relevant fields, and discuss key model inputs and assumptions. The main objective of 

this process was to develop a range of SCC values using a defensible set of input assumptions 

grounded in the existing scientific and economic literatures. In this way, key uncertainties and 

model differences transparently and consistently inform the range of SCC estimates used in the 

rulemaking process. 

2.16.1.1 Monetizing Carbon Dioxide Emissions 

The SCC is an estimate of the monetized damages associated with an incremental increase in 

carbon emissions in a given year. It is intended to include (but is not limited to) changes in net 

agricultural productivity, human health, property damages from increased flood risk, and the 

value of ecosystem services. Estimates of the SCC are provided in dollars per metric ton of 

carbon dioxide. 

When attempting to assess the incremental economic impacts of carbon dioxide emissions, the 

analyst faces a number of serious challenges. A recent report from the National Research 
2-16

Councila points out that any assessment will suffer from uncertainty, speculation, and lack of 

information about (1) future emissions of greenhouse gases, (2) the effects of past and future 

emissions on the climate system, (3) the impact of changes in climate on the physical and 

biological environment, and (4) the translation of these environmental impacts into economic 

damages. As a result, any effort to quantify and monetize the harms associated with climate 

change will raise serious questions of science, economics, and ethics and should be viewed as 

provisional. 

Despite the serious limits of both quantification and monetization, SCC estimates can be useful 

in estimating the social benefits of reducing carbon dioxide emissions. Consistent with the 

directive in Executive Order 12866 quoted above, the purpose of the SCC estimates presented 

here is to make it possible for Federal agencies to incorporate the social benefits from reducing 

carbon dioxide emissions into cost-benefit analyses of regulatory actions that have small, or 

“marginal,” impacts on cumulative global emissions. Most Federal regulatory actions can be 

expected to have marginal impacts on global emissions.

For such policies, the agency can estimate the benefits from reduced (or costs from increased) 

emissions in any future year by multiplying the change in emissions in that year by the SCC 

value appropriate for that year. The net present value of the benefits can then be calculated by 

multiplying each of these future benefits by an appropriate discount factor and summing across 

all affected years. This approach assumes that the marginal damages from increased emissions 

are constant for small departures from the baseline emissions path, an approximation that is 

reasonable for policies that have effects on emissions that are small relative to cumulative global 

carbon dioxide emissions. For policies that have a large (non-marginal) impact on global 

cumulative emissions, there is a separate question of whether the SCC is an appropriate tool for 

calculating the benefits of reduced emissions. This concern is not applicable in general to energy 

conservation standards, and DOE does not attempt to answer that question here. 

At the time of the preparation of this document, the most recent interagency estimates of the 

potential global benefits resulting from reduced CO2 emissions in 2010, expressed in 2010$, 

were $4.9, $22.3, $36.5, and $67.6 per metric ton avoided. For emissions reductions that occur in 

later years, these values grow in real terms over time. Additionally, the interagency group 

determined that a range of values from 7 percent to 23 percent should be used to adjust the global 

SCC to calculate domestic effects,b although preference is given to consideration of the global 

benefits of reducing CO2 emissions. 

It is important to emphasize that the interagency process is committed to updating these 

estimates as the science and economic understanding of climate change and its impacts on 

society improves over time. Specifically, the interagency group has set a preliminary goal of 

revisiting the SCC values within 2 years or at such time as substantially updated models become 

available, and to continue to support research in this area. In the meantime, the interagency group 

 

a National Research Council. Hidden Costs of Energy: Unpriced Consequences of Energy Production and Use.

National Academies Press: Washington, DC (2009).

b It is recognized that this calculation for domestic values is approximate, provisional, and highly speculative. There 

is no a priori reason why domestic benefits should be a constant fraction of net global damages over time.
2-17

will continue to explore the issues raised by this analysis and consider public comments as part 

of the ongoing interagency process. 

2.16.1.2 Social Cost of Carbon Values Used in Past Regulatory Analyses 

To date, economic analyses for Federal regulations have used a wide range of values to estimate 

the benefits associated with reducing carbon dioxide emissions. In the final model year 2011 

CAFE rule, the U.S. Department of Transportation (DOT) used both a “domestic” SCC value of 

$2 per ton of CO2 and a “global” SCC value of $33 per ton of CO2 for 2007 emission reductions 

(in 2007$), increasing both values at 2.4 percent per year.c DOT also included a sensitivity 

analysis at $80 per ton of CO2. See Average Fuel Economy Standards Passenger Cars and Light 

Trucks Model Year 2011, 74 FR 14196 (March 30, 2009) (Final Rule); Final Environmental 

Impact Statement Corporate Average Fuel Economy Standards, Passenger Cars and Light 

Trucks, Model Years 2011-2015 at 3-90 (Oct. 2008) (Available at: http://www.nhtsa.gov/fueleconomy). A domestic SCC value is meant to reflect the value of damages in the United States 

resulting from a unit change in carbon dioxide emissions, while a global SCC value is meant to 

reflect the value of damages worldwide.

A 2008 regulation proposed by DOT assumed a domestic SCC value of $7 per ton of CO2 (in 

2006$) for 2011 emission reductions (with a range of $0−$14 for sensitivity analysis), also 

increasing at 2.4 percent per year. See Average Fuel Economy Standards, Passenger Cars and 

Light Trucks, Model Years 2011-2015, 73 FR 24352 (May 2, 2008) (Proposed Rule); Draft 

Environmental Impact Statement Corporate Average Fuel Economy Standards, Passenger Cars 

and Light Trucks, Model Years 2011-2015 at 3-58 (June 2008) (Available at: 

http://www.nhtsa.gov/fuel-economy). A regulation for packaged terminal air conditioners and 

packaged terminal heat pumps finalized by DOE in October of 2008 used a domestic SCC range 

of $0 to $20 per ton CO2 for 2007 emission reductions (in 2007$). 73 FR 58772, 58814 (Oct. 7, 

2008) In addition, EPA’s 2008 Advance Notice of Proposed Rulemaking on Regulating 

Greenhouse Gas Emissions Under the Clean Air Act identified what it described as “very 

preliminary” SCC estimates subject to revision. 73 FR 44354 (July 30, 2008). EPA’s global 

mean values were $68 and $40 per ton CO2 for discount rates of approximately 2 percent and 3 

percent, respectively (in 2006$ for 2007 emissions). 

In 2009, an interagency process was initiated to offer a preliminary assessment of how best to 

quantify the benefits from reducing carbon dioxide emissions. To ensure consistency in how 

benefits are evaluated across agencies, the Administration sought to develop a transparent and 

defensible method, specifically designed for the rulemaking process, to quantify avoided climate 

change damages from reduced CO2 emissions. The interagency group did not undertake any 

original analysis. Instead, it combined SCC estimates from the existing literature to use as 

interim values until a more comprehensive analysis could be conducted. The outcome of the 

preliminary assessment by the interagency group was a set of five interim values: global SCC 

estimates for 2007 (in 2006$) of $55, $33, $19, $10, and $5 per ton of CO2. These interim values 

represent the first sustained interagency effort within the U.S. Government to develop an SCC 

for use in regulatory analysis. The results of this preliminary effort were presented in several 

 

c Throughout this section, references to tons of CO2 refer to metric tons.
2-18

proposed and final rules and were offered for public comment in connection with proposed rules, 

including the joint EPA-DOT fuel economy and CO2 tailpipe emission proposed rules. 

2.16.1.3 Current Approach and Key Assumptions 

Since the release of the interim values, the interagency group reconvened on a regular basis to 

generate improved SCC estimates. Specifically, the group considered public comments and 

further explored the technical literature in relevant fields. The interagency group relied on three 

integrated assessment models (IAMs) commonly used to estimate the SCC: the FUND, DICE, 

and PAGE models. These models are frequently cited in the peer-reviewed literature and were 

used in the last assessment of the Intergovernmental Panel on Climate Change. Each model was 

given equal weight in the SCC values that were developed. 

Each model takes a slightly different approach to model how changes in emissions result in 

changes in economic damages. A key objective of the interagency process was to enable a 

consistent exploration of the three models while respecting the different approaches to 

quantifying damages taken by the key modelers in the field. An extensive review of the literature 

was conducted to select three sets of input parameters for these models: climate sensitivity, 

socio-economic and emissions trajectories, and discount rates. A probability distribution for 

climate sensitivity was specified as an input into all three models. In addition, the interagency 

group used a range of scenarios for the socio-economic parameters and a range of values for the 

discount rate. All other model features were left unchanged, relying on the model developers’ 

best estimates and judgments.

The interagency group selected four SCC values for use in regulatory analyses. Three values are 

based on the average SCC from three integrated assessment models, at discount rates of 2.5, 3, 

and 5 percent. The fourth value, which represents the 95th percentile SCC estimate across all 

three models at a 3-percent discount rate, is included to represent higher-than-expected impacts 

from temperature change further out in the tails of the SCC distribution. For emissions (or 

emission reductions) that occur in later years, these values grow in real terms over time, as 

depicted in Table 2.16.1. 
2-19

Table 2.16.1 Social Cost of CO2, 2010–2050 (in 2007 dollars per metric ton) 

Discount Rate

5% 3% 2.5% 3%

Avg Avg Avg 95th

2010 4.7 21.4 35.1 64.9

2015 5.7 23.8 38.4 72.8

2020 6.8 26.3 41.7 80.7

2025 8.2 29.6 45.9 90.4

2030 9.7 32.8 50.0 100.0

2035 11.2 36.0 54.2 109.7

2040 12.7 39.2 58.4 119.3

2045 14.2 42.1 61.7 127.8

2050 15.7 44.9 65.0 136.2

It is important to recognize that a number of key uncertainties remain, and that current SCC 

estimates should be treated as provisional and revisable since they will evolve with improved 

scientific and economic understanding. The interagency group also recognizes that the existing 

models are imperfect and incomplete. The National Research Council report mentioned above 

points out that there is tension between the goal of producing quantified estimates of the 

economic damages from an incremental ton of carbon and the limits of existing efforts to model 

these effects. There are a number of concerns and problems that should be addressed by the 

research community, including research programs housed in many of the Federal agencies 

participating in the interagency process to estimate the SCC.

DOE recognizes the uncertainties embedded in the estimates of the SCC used for cost-benefit 

analyses. As such, DOE and others in the U.S. Government intend to periodically review and 

reconsider those estimates to reflect increasing knowledge of the science and economics of 

climate impacts, as well as improvements in modeling. In this context, statements recognizing 

the limitations of the analysis and calling for further research take on exceptional significance.

In summary, in considering the potential global benefits resulting from reduced CO2 emissions, 

DOE uses the most recent values identified by the interagency process, adjusted to current 

dollars using the GDP price deflator. For each of the four cases specified, the values used for 

emissions in 2010 are $4.9, $22.3, $36.5, and $67.6 per metric ton avoided (values expressed in 

2010$). To monetize the CO2 emissions reductions expected to result from new OR amended 

energy conservation standards, DOE uses the values identified in Table A1 of the “Social Cost of 

Carbon for Regulatory Impact Analysis Under Executive Order 12866,”d

 appropriately adjusted 

to current dollars. To calculate a present value of the stream of monetary values, DOE discounts 

the values in each of the four cases using the specific discount rate that had been used to obtain 

the SCC values in each case.

 

d Table A1 presents SCC values through 2050. For DOE’s calculations, it derives values after 2050 using the 3-

percent per year escalation rate used by the interagency group.
2-20

2.16.2 Valuation of Other Emissions Reductions

DOE investigates the potential monetary benefit of reduced NOX emissions from the TSLs it 

considers. As noted above, DOE takes into account how new OR amended energy conservation 

standards would reduce NOX emissions in those 22 States not affected by the CAIR. DOE 

estimates the monetized value of NOX emissions reductions resulting from each of the TSLs 

considered based on environmental damage estimates found in the relevant scientific literature. 

Available estimates suggest a very wide range of monetary values, ranging from $370 per ton to 

$3,800 per ton of NOX from stationary sources, measured in 2001$ (equivalent to a range of 

$450 to $4,623 per ton in 2010$).e

 In accordance with OMB guidance, DOE conducts two 

calculations of the monetary benefits derived using each of the economic values used for NOX, 

one using a real discount rate of 3 percent and another using a real discount rate of 7 percent.f 

DOE is aware of multiple agency efforts to determine the appropriate range of values used in 

evaluating the potential economic benefits of reduced Hg emissions. DOE has decided to await 

further guidance regarding consistent valuation and reporting of Hg emissions before it once 

again monetizes Hg emissions in its rulemakings. 

2.17 REGULATORY IMPACT ANALYSIS

DOE prepares a regulatory impact analysis (RIA) under Executive Order 12866, “Regulatory 

Planning and Review,” 58 FR 51735, October 4, 1993, which is subject to review under the 

Executive Order by the Office of Information and Regulatory Affairs (OIRA) at the Office of 

Management and Budget. The RIA evaluates non-regulatory alternatives to standards, in terms of 

their ability to achieve significant energy savings in the considered products at a reasonable cost, 

and compares the effectiveness of each one to the effectiveness of the adopted standards.

DOE recognizes that voluntary or other non-regulatory efforts by manufacturers, utilities, and 

other interested parties can result in substantial improvements to energy efficiency or reductions 

in energy consumption. DOE considers the likely effects of non-regulatory initiatives on product 

energy use, consumer utility, and LCC. DOE bases its assessment on the actual impacts of any 

such initiatives to date, but also considers information presented regarding the impacts that any 

existing initiative might have in the future. 

 

e For additional information, refer to U.S. Office of Management and Budget, Office of Information and Regulatory 

Affairs, 2006 Report to Congress on the Costs and Benefits of Federal Regulations and Unfunded Mandates on 

State, Local, and Tribal Entities, Washington, DC.

f OMB, Circular A-4: Regulatory Analysis (Sept. 17, 2003).
3-i

CHAPTER 3. PRELIMINARY MARKET ASSESSMENT

TABLE OF CONTENTS

3.1 INTRODUCTION ........................................................................................................... 3-1

3.2 CATEGORIZING SET-TOP BOXES ............................................................................. 3-1

3.3 MARKET OVERVIEW .................................................................................................. 3-2

3.4 MAJOR MANUFACTURERS ........................................................................................ 3-4

3.5 MAJOR SERVICE PROVIDERS ................................................................................... 3-4

3.6 INDUSTRY TRADE GROUPS AND ASSOCIATIONS ............................................... 3-5

3.7 ANNUAL SHIPMENTS, INSTALLED BASE, AND AVERAGE PRICES ................. 3-7

3.8 RELEVANT CONSUMER ISSUES ............................................................................... 3-8

3.8.1 Principal Agent Problem .................................................................................................. 3-8

3.8.2 Other Issues ...................................................................................................................... 3-8

3.9 OVER-THE-TOP OPTIONS ........................................................................................... 3-9

3.10 STAND-ALONE DVRS AND DTAS........................................................................... 3-10

3.11 EXISTING REGULATORY AND VOLUNTARY PROGRAMS .............................. 3-11

3.11.1 ENERGY STAR ............................................................................................................ 3-11

3.11.2 Federal Communications Commission .......................................................................... 3-13

3.11.3 Summary of International Programs .............................................................................. 3-13

3.11.4 European Union Voluntary Agreement on Set-Top Boxes ........................................... 3-14

3.12 EXISTING TEST PROCEDURES................................................................................ 3-15

LIST OF TABLES

Table 3.2.1 Pay-TV STB Categories ...................................................................................... 3-1

Table 3.4.1 Major Pay-TV STB Manufacturers (2010) .......................................................... 3-4

Table 3.5.1 Major Pay-TV Service Providers (2011) ............................................................. 3-5

Table 3.5.2 Estimated Purchases of STBs by Major Pay-TV Service Providers (2010, 

in thousands) ........................................................................................................ 3-5

Table 3.7.1 Estimated and Projected Shipments of Pay-TV STBs in the U.S. by Base 

Type and Feature Class (in thousands) ................................................................ 3-7

Table 3.7.2 Estimated and Projected Installed Base of Pay-TV STBs in the U.S. by 

Base Type (in thousands) ..................................................................................... 3-7

Table 3.7.3 Average Estimated and Projected Prices of Pay-TV STBs in the U.S. by 

Base Type............................................................................................................. 3-8

Table 3.9.1 Select Over-the-Top STBs ................................................................................... 3-9

Table 3.9.2 Select Over-the-Top Services. ........................................................................... 3-10

Table 3.11.1 ENERGY STAR Requirements for STBs ......................................................... 3-12

Table 3.11.2 Select International Policy Pertaining to STBs .................................................. 3-13

Table 3.11.3 U.S. ENERGY STAR and EU Voluntary Agreement Total Energy 

Allowances (in kWh) ......................................................................................... 3-14
3-ii

LIST OF FIGURES 

Figure 3.3.1 U.S. Pay-TV and Broadband Market Trends ....................................................... 3-3

Figure 3.3.2 STB Distribution Channel.................................................................................... 3-3
3-1

CHAPTER 3. PRELIMINARY MARKET ASSESSMENT

3.1 INTRODUCTION

This chapter provides a preliminary assessment of the STB market in the United States. The 

assessment includes categories and potential product classes, major manufacturers, major service 

providers, relevant trade associations, annual shipments, the installed base, market trends, and 

emerging or niche market segments. This chapter also discusses existing mandatory and 

voluntary regulatory programs. 

3.2 CATEGORIZING SET-TOP BOXES

A STB can be generically defined as a device whose primary function is to receive television or 

video signals and deliver them to a consumer display or recording device (see Appendix for a 

complete list of definitions). Market analysts and service providers categorize pay-TV STBs into 

three base types and four feature classes, resulting in 12 unique groups of pay-TV STBs (Table 

3.2.1). This form of categorization distinguishes between: (1) what type of service provider (i.e., 

base type) a consumer is choosing from, and (2) what pay-TV STB feature class a consumer is 

selecting for their home. In addition, there are over-the-top options (OTT) and other STBs that 

do not provide conditional access (see sections 3.9 and 3.10). 

Table 3.2.1 Pay-TV STB Categories

Base Types

Cable

Satellite

Internet Protocol Television (IPTV)

Feature Classes

Standard definition (SD) receiver

High definition (HD) receiver

Standard definition digital video recorder (SD-DVR)

High definition digital video recorder (HD-DVR)

In addition, STBs without a DVR can have 1-way or 2-way communication with the service 

provider. 2-way communication allows for pay-per-view and video-on-demand functionality, 

although a DVR is necessary for such content to be stored locally. STBs with a DVR have 2-way 

communication. STBs with only 1-way communication currently represent a relatively small 

percentage of the market, and are losing market share in favor of 2-way STBs. 1-way cable STBs 

can be used, however, as an expensive way to connect secondary TVs with cable service in a 

home (as opposed to using simpler thin clients). 

 

In general, market data for pay-TV STBs are presented in this format (and perhaps include a few 

additional feature classes). Existing STB energy efficiency policies, however, categorize STBs 
3-2

slightly differently. While the market segment (e.g., Cable, Satellite, IPTV) of a STB remains a 

key distinction, feature class (e.g., SD, HD, SD-DVR, HD-DVR) has not been used as a specific 

way of grouping STBs for existing standards purposes. HD and DVR capability are instead 

considered additional functionalities, not specific types of STBs, among many other types of 

additional functionalities (e.g., advanced video processing, home network interface, multistream, multi-room, removable media player/recorder). A base functionality, determined by the 

market segment, combines with a set of additional functionalities (which can be used with any 

base type). This is the approach adopted by ENERGY STAR and with the European voluntary 

agreement, where the base functionality and additional functionalities determine the total energy 

consumption allowance for a given STB. When necessary, DOE divides covered products into 

product classes by the type of energy used, the capacity of the product, and any other 

performance-related feature that justifies different standard levels, such as features affecting 

consumer utility. (42 U.S.C. 6295(q)) As part of this rulemaking proceeding, DOE will evaluate 

the market for STBs and potentially separate covered products into product classes based on the 

criteria described above.

3.3 MARKET OVERVIEW

The current STB market has developed into a complex mix of deployed devices and service 

offerings. Over 80 percent of U.S. homes subscribe to pay-TV provided by their cable, satellite 

or phone company (Figure 3.3.1), resulting in over 160 million installed pay-TV STBs in U.S. 

homes.1 In recent years, however, viewership has declined as consumers moved to streaming 

online content only. Cable TV, in particular, lost over 2 million video subscribers in 2010, a 

bigger loss than the 1.5 million customers in 2009.2 Nevertheless, pay-TV remains the biggest 

piece of the media consumption market. Some consumers are replacing their pay-TV service 

with broadband-based services using OTT options (including both hardware and software 

options), such as AppleTV, Netflix, and Roku. Traditional pay-TV service includes a monthly 

subscription fee with additional pay-per-view options (e.g., live events, movies), whereas OTT 

options include pay-per-view only (e.g., AppleTV, Amazon Instant Video) or a monthly 

subscription for unlimited content (e.g., Netflix, Hulu). Pay-TV service providers are now 

offering similar features on their STBs. This assessment focuses on the pay-TV STB market 

specifically in the following sections (3.4 to 3.8), but provides an overview of the separate 

market for over-the-top options in section 3.9 and stand-alone devices in section 3.10. 
3-3

Figure 3.3.1 U.S. Pay-TV and Broadband Market Trends

Source: Hardy and Swofford (2011).1 Figure based on U.S. Census (www.tvb.org; OECD; and other public data).3

Reprinted with permission.

Pay-TV STB market actors fall into four main categories: (1) chip manufacturers, (2) 

middleware developers, (3) STB manufacturers and (4) service providers (Figure 3.3.2). This 

market assessment focuses on STB manufacturers and service providers as these two groups 

have the most influence on the energy consumption of pay-TV STBs. Hardware manufacturers 

design and produce STBs based on the demand and requirements of service providers. Service 

providers purchase a large number of STBs from these manufacturers.

4 The largest pay-TV 

service providers (e.g., DirecTV and Comcast; see section 3.5) ultimately decide on the 

chipset, middleware, and features offered for a deployed STB. They then present these product 

offerings to smaller service providers as off-the-shelf designs to reduce development costs. 

After procurement, service providers control box deployment, configuration, maintenance, and 

refurbishment. All service providers own the STBs and supply them to the consumer as part of 

a service agreement.

4 As a result, any potential changes in STB design and operation require 

the involvement of all actors in this supply chain and distribution system, including the service 

providers. Figure 3.3.2 outlines the components in the STB distribution channel chain 

Figure 3.3.2 STB Distribution Channel

Middleware

Programmer

Manufacturer Service Provider Pay-TV Subscriber

STBs

Build Specs TV Programming

$$$

Components

Chipset

Manufacturer
3-4

3.4 MAJOR MANUFACTURERS

Service providers purchase their STBs through a bidding process that multiple manufacturers 

compete in to meet requested specifications at the lowest cost.4 For example, a large service 

provider might specify a box including high definition video capability, MoCA networking 

capability, six tuners, and a DVR. Currently, Motorola, Cisco, Pace, and EchoStar own the 

majority of the STB manufacturing market in the U.S. (see Table 3.4.1). The development 

timeline for STB hardware is similar regardless of service provider type, typically ranging from 

6 to 18 months for motherboard and system design and three to five years for silicon design. The 

6 to18 month lead-time refers to the development of the motherboard and system based on 

available silicon technology.

Table 3.4.1 Major Pay-TV STB Manufacturers (2010) 

Company Market Share Cable Satellite IPTV 

Motorola 35% x x 

Cisco 18% x x 

Pace 18% x x 

EchoStar 12% x 

Other 18% N/A

Note: These market shares are for U.S. STBs only.

Source: IMS Research.5

3.5 MAJOR SERVICE PROVIDERS

In the U.S., service providers supply the majority of STBs to the consumer. Major service 

providers have considerable influence over the manufacturer in terms of choice of middleware, 

content protection features, applications and other functionalities. The pay-TV STB market is 

different from the markets for most other consumer electronics devices, in that consumers have 

little influence on the type of STB installed in their home. Service providers use STBs to store 

the latest user information, electronic program guide data and security codes to ensure only paid 

subscribers have access to content.4 These data are frequently updated (e.g., dynamic channel 

allocation, dynamic security codes), which is one reason why some STBs require a relatively 

long time to wake-up from a deep sleep. Table 3.5.1 lists the top ten U.S. pay-TV service 

providers by number of subscribers. Table 3.5.2 shows STB purchases by service providers in 

2010. 
3-5

Table 3.5.1 Major Pay-TV Service Providers (2011) 

Service Provider Segment Pay-TV Subscribers 

Comcast Cable 22,525,000

DirecTV Satellite 19,433,000

Dish Network Satellite 14,056,000

Time Warner Cable Cable 12,235,000

Cox Communications Cable 4,838,000

Charter Communications Cable 4,413,000

Verizon (FiOS) Communications Cable† 3,848,000

AT&T IPTV 3,407,000

Cablevision Systems Cable 3,284,000

Bright House Networks Cable 2,139,000

† Verizon FiOS provides TV on a fiber optic backbone, using cable network technology inside the home. AT&T 

U-Verse uses IPTV technology to deliver content via high speed DSL.

Source: National Cable Telecommunications Association.

6

Table 3.5.2 Estimated Purchases of STBs by Major Pay-TV Service Providers 

(2010, in thousands) 

Service Provider Grand Total

Comcast 16,430

DirecTV 7,413

Dish Network 5,293

AT&T 3,456

Verizon (FiOS) Communications 3,153

Time Warner Cable 2,293

Cox Communications 1,263

Charter Communications 1,048

Bright House Networks 793

Cablevision Systems 687

Other 904

Source: IMS Research.5

3.6 INDUSTRY TRADE GROUPS AND ASSOCIATIONS 

STB manufacturers and service providers are typically associated with the following groups 

(descriptions are adapted from group websites): 

American Cable Association (ACA). ACA’s membership comprises of cable, phone, and fiberto-the-home operators and municipalities, who deliver basic and advanced services, such as high 

definition television, next generation Internet access and digital phone, to more than 7 million 
3-6

households and businesses, some of whom have no other means of receiving these services. 

http://www.americancable.org/ 

Association for Maximum Service Television (MSTV). Trade organization focused on overthe-air broadcast technology and policy issues. 

http://www.mstv.org/ 

CableLabs. Cable Television Laboratories, Inc. (CableLabs®) is a non-profit research and 

development consortium that is dedicated to pursuing new cable telecommunications 

technologies and to helping its cable operator members integrate those technical advancements 

into their business objectives. 

http://www.cablelabs.com/ 

Consumer Electronics Association (CEA). CEA is a standards and trade organization for the 

consumer electronics industry in the United States. 

http://www.ce.org/ 

Digital Living Network Alliance (DLNA). A collection of various companies, the DLNA has 

developed interoperability guidelines that outline standards for device communication and 

content sharing among various devices within the home. 

http://www.dlna.org/ 

Multimedia over Coax Alliance (MoCA). MoCA is an open, international technology standard 

body promoting networking of multiple streams of high definition video around the home using 

the existing coaxial cabling. The MoCA standard uses the existing coax cabling in the home for 

connecting devices such as STBs, PVRs, home gateways, wireless access point and game 

consoles, among others. 

http://www.mocalliance.org/

National Association of Broadcasters (NAB). NAB is a trade organization for radio and 

television broadcasters, serving its members’ interests in federal government, industry and public 

affairs; improving the quality and profitability of broadcasting; encouraging content and 

technology innovation; and identifying ways stations serve their communities. 

http://www.nab.org/

National Cable and Telecommunications Association (NCTA). The National Cable and 

Telecommunications Association, formerly the National Cable Television Association, is the 

principal trade association of the cable industry in the United States. 

http://www.ncta.com/

RVU Alliance. The RVU Alliance is a consortium of leading content service provider, 

semiconductor and consumer electronics companies gathered to advance the use of Remote User 

Interface (RUI) technology for home networked television entertainment, ensuring 

interoperability among devices implementing RVU's RUI technology, and educating the market 

about RVU technology. 

http://www.rvualliance.org/ 
3-7

Satellite Broadcasting and Communications Association (SBCA). The Satellite Broadcasting 

and Communications Association is the national trade organization representing all segments of 

the consumer satellite industry. 

http://www.sbca.com/

3.7 ANNUAL SHIPMENTS, INSTALLED BASE, AND AVERAGE PRICES

Table 3.7.1 to Table 3.7.3 provide additional market data and forecasts for annual shipments, the 

installed base, and average prices of STBs. The average prices span all STB product classes (e.g., 

SD, HD, DVR, thin client, etc.) estimated to be sold that year. Cable remains the most prominent 

form of pay-TV, but increased popularity of both satellite and IPTV service offerings may 

change the landscape over the next few years. In terms of feature classes, the HD-DVR box is 

gaining significant share across all three market segments.

Table 3.7.1 Estimated and Projected Shipments of Pay-TV STBs in the U.S. by Base 

Type and Feature Class (in thousands) 

2009 2010 2011 2012 2013 2014 2015

Cable 23,803 25,607 25,007 26,867 21,474 19,693 18,874

Satellite 12,563 13,348 13,465 14,338 14,123 13,774 13,767

IPTV 3,461 3,598 3,753 4,527 4,483 4,767 5,109

Total DVR 11,975 14,929 16,656 19,934 18,099 17,734 16,876

Total non-DVR 27,852 27,624 25,569 25,798 21,981 20,500 20,874

Source: IMS Research.7

Table 3.7.2 Estimated and Projected Installed Base of Pay-TV STBs in the U.S. by 

Base Type (in thousands)

2009 2010 2011 2012 2013 2014 2015

Cable 80,228 95,206 103,550 113,349 116,383 116,151 113,309

Satellite 57,859 59,782 62,147 62,138 60,353 57,347 54,125

IPTV 5,997 8,508 10,959 13,713 16,185 18,620 20,648

Source: IMS Research.7 
3-8

Table 3.7.3 Average Estimated and Projected Prices of Pay-TV STBs in the U.S. by 

Base Type

2009 2010 2011 2012 2013 2014 2015

Cable $61-$223 $56-$218 $52-$214 $48-$210 $44-$195 $41-$189 $38-$183

Satellite $60-$190 $55-$180 $51-$171 $47-$163 $44-$154 $41-$147 $40-$140

IPTV $94-$192 $132-$182 $123-$173 $115-$165 $106-$156 $46-$149 $43-$141

Source: IMS Research.7 

3.8 RELEVANT CONSUMER ISSUES

3.8.1 Principal Agent Problem

Pay-TV STBs differ from other consumer electronics devices because the service provider owns 

the STB, not the consumer. Therefore, even though the consumer pays the electricity bill, it is the 

service provider that decides what STB is used and how much energy it uses.1 This situation, 

where one entity pays the first cost but another pays the operating cost, is known as a principal 

agent problem.8 The principal agent problem is most evident when service providers include the 

STB hardware as part of a rental agreement.9 This service agreement, including leased 

equipment, is the most common arrangement in the U.S. pay-TV market today. The principal 

agent problem offers only limited incentive for service providers to deploy more costly energy 

efficient STBs, beyond any efficiency required for increased utility. Although STB 

manufacturers are capable of building more efficient STBs, they only build to the service 

provider specifications, which is largely cost and quality-of-service driven. This situation is 

potentially the most significant barrier to reducing the national energy consumption of STBs in 

the U.S.

3.8.2 Other Issues

Other key consumer issues include the following: 

• Long Start-up Times. When a STB is powered off, it often takes two to five minutes to 

start (or “boot”) up and resume full functionality. This is why most STBs do not power 

down. This lead time is necessary for the STB to communicate with the service provider, 

download the latest electronic programming guide, check subscription entitlements, and 

enable all the appropriate conditional access. 

• Limited Customization/Choice. Customers have limited choice of what type of STB their 

service provider deploys to their home. In addition, the middleware installed by the 

service provider often gives little to no options for customization (e.g., view options, 

channel filtering, etc.). This is related to the principle agent problem. 

• IPTV Limitations. Currently, IPTV technology is not widely deployed across the United 

States. Due to bandwidth constraints, the video feed is compressed, resulting in minor 

artifacting and/or inferior picture quality. It is unclear, however, if this is widely 
3-9

perceived by consumers. In addition, it is very expensive to deploy fiber-to-the-home or 

high-speed digital subscriber lines in order to carry a pure IPTV signal to a large 

percentage of homes. 

3.9 OVER-THE-TOP OPTIONS

Consumers are increasingly utilizing media on demand to accommodate their lifestyles. Many 

viewers prefer sports, news, and season finales in real time, whereas TV series and movies can 

be recorded and watched at a later time. Consumers are watching content on a variety of 

different media (e.g., TV, tablet, laptop, cell phone) depending on their circumstances and 

location. Pay-TV service providers are working quickly to offer growing video on demand 

libraries, DVRs, multi-room functionality, and tablet PC streaming. Consumers can now access, 

however, a large amount of content outside the pay-TV spectrum. As a result, a growing number 

of consumers are canceling pay-TV subscriptions. Devices that access content outside the payTV spectrum are referred to as “over-the-top” (OTT) because they go “over-the-top” of a payTV subscription. Both hardware like AppleTV and software like Netflix supplement the video on 

demand library offered by the pay-TV provider. These devices are well-suited to watching older 

movies, sports highlights, and past TV episodes. The most recent content, however, is typically 

delayed anywhere from a day to a month, making OTTs a limited substitute for new broadcast 

content. OTTs are generally divided into three groups: 

OTT STBs. These include the hardware and software necessary to stream video content to a 

display. Like a pay-TV STB, these devices generally sit in close proximity to a television. What 

hinders OTT STBs is their lack of content. Without a number of the latest shows and live sports 

or news content, these options still offer only a portion of the content that the pay-TV industry 

provides. Examples of OTT STBs are included in Table 3.9.1. 

Table 3.9.1 Select Over-the-Top STBs

Name Company Description Comments

AppleTV Apple Hardware with installed 

software that offers video 

library (ITunes Store)

Over 1 million units sold in 

2010

Boxee Box Boxee Hardware with installed 

software (named Boxee) that 

offers video library and 

additional applications

Boxee Inc. startup company 

supported by various venture 

capital firms; collaborated 

with D-Link in developing 

Boxee Box device

Roku Roku Hardware with installed 

software that offers video 

library (Roku Channel Store)

Private consumer electronics 

firm in CA, USA

WD TV 

Live Hub

Western Digital STB device with additional 

storage capability 

Computer hard drive 

manufacturer 

OTT Services. These are the services that can be installed on a host to make video streaming 

possible. They include online video libraries, video subscription services, and media player 
3-10

software. Note that some OTT set-top manufacturers also provide OTT service (e.g., Apple, 

Boxee). Examples of OTT services are included in Table 3.9.2. 

Table 3.9.2 Select Over-the-Top Services.

Name Company Description Comments

Boxee Boxee Software (cross platform 

freeware media player)

Boxee Inc. startup company 

supported by various venture 

capital firms; collaborated 

with D-Link in developing 

Boxee Box device

Google TV Google Software built into CE 

products (e.g., Sony TV, 

Logitech STB) 

Expected to partner with 

more CE makers in 2011

Hulu Hulu Website and OTT 

subscription service

Hulu launched in the U.S. in 

2008 and has become a 

popular OTT option

iTunes Apple Software that offers video 

library (and other media) 

across Apple’s devices

First introduced by Apple in 

2001 and has become the 

most popular music library 

software

Kylo Kylo Software (open source 

television-based Internet

browser)

Hillcrest Labs introduced 

Kylo in Spring 2010

Netflix Netflix Content subscription service Offers on-demand streaming 

and rental by mail service

SlingBox Sling Preinstalled place shifting 

software installed on 

traditional STBs 

Acquired by EchoStar in 

2007 for approximately $380 

million

Vudu HDX, 

VuduBox

Vudu Software built into products 

from various television and 

blu-ray player 

manufacturers.

Acquired by Walmart in 2010 

for approximately $100 

million 

OTT Hosts. These include consumer electronics that offer OTT services as a secondary 

function. For example, the primary use of a video game console is to play video games, but some 

game consoles are also capable of streaming Netflix movies. OTT hosts are not the focus of this 

assessment. Examples of OTT hosts include the following: 

• Video game consoles 

• Personal computers 

• Blu-ray players

• Internet-enabled TVs

• Cell Phones 

• Tablets

3.10 STAND-ALONE DVRS AND DTAS

Other types of STBs not associated with service providers include stand-alone DVRs and digital 

transport adaptors (DTAs, also known as simple STBs in Europe). Stand-alone DVRs can be 
3-11

purchased through retail, whereas DTAs are primarily used in the U.S. to convert digital signals 

to analog signals for use with older analog televisions. 

TiVo provides the only known stand-alone DVR in the U.S. Today’s TiVo boxes are typically 

configured as cable STB by adding a CableCARD (to enable conditional access). Most TiVo 

customers use their TiVo DVR to replace their cable DVR. The standard TiVo costs $100 and 

requires a $20 monthly service fee. Instead of leasing a DVR from the cable service provider, the 

consumer would lease a CableCARD from the service provider and install it in the TiVo. The 

benefit of the TiVo is a robust user interface, electronic channel guide, OTT content, and a lower 

cable bill (if the cable service provider has a separate fee for a DVR rental). TiVo cannot display, 

however, video on demand programming from the service provider. Due to the CableCARD 

access, the TiVo STB is generally considered a cable STB.

TiVo can also be connected to a digital antenna and used as a DVR for free-to-air content for 

households that do not subscribe to pay-TV. This likely represents only a very small fraction of 

TiVo users, however. Furthermore, with the advent of Internet-enabled TVs and game consoles 

that can access the same OTT content as TiVo, there is only a marginal benefit associated with 

having the streaming functionality integrated into the same user interface as broadcast TV. In the 

coming months, TiVo will be working with DirecTV to manufacture a TiVo DVR that will be 

sold through DirecTV and not retail10; this STB would be classified as a satellite STB. 

Stand-alone DVRs and DTAs represent a very small market share. Furthermore, the market share 

is declining as consumers opt for pay-TV service or other OTT options, and as consumers 

purchase newer televisions capable of digital input. As a result, these devices are not the focus of 

this assessment.

3.11 EXISTING REGULATORY AND VOLUNTARY PROGRAMS

3.11.1 ENERGY STAR

ENERGY STAR’s Version 1.0 STB product specification went into effect on January 1, 2001. 

Tier 1 energy efficiency criteria took effect immediately, and more stringent Tier 2 criteria were 

expected to become effective on January 1, 2004. However, in June 2003, the EPA extended the 

Tier 1 criteria indefinitely based on input from stakeholders. On December 16, 2004, the EPA 

notified stakeholders of its intent to suspend the STB specification effective February 2, 2005. In 

March 2007, the EPA announced its intention to re-open the process to revise the ENERGY 

STAR program for STBs. 

Version 2.0 Tier 1 came into effect on January 1, 2009. Version 2.0 qualification requirements 

were based on a total energy consumption (TEC) allowance for (i) base functionality and (ii) 

additional functionalities. The TEC approach assumes a typical duty cycle for each mode. The 

current specification is Version 3.0, which came into effect on September 1, 2011. Version 4.0 is 

scheduled to come into effect on July 1, 2013. Both Version 3.0 and 4.0 use the same TEC 

allowance approach, in addition to defining general criteria for external power supplies, 
3-12

maintenance activities, auto power down (APD) and deep sleep. EPA finalized both Version 3.0 

and 4.0 on January 21, 2011. See Table 3.11.1 for ENERGY STAR requirements for STBs. 

Table 3.11.1 ENERGY STAR Requirements for STBs

STB Type Version 3.0 

(kWh/yr)

Version 4.0

(kWh/yr)

Base 

Functionality

Cable 60 45

Satellite 70 50

IPTV 50 25

Cable DTA 35 25

Terrestrial 22 18

Thin Client / 

Remote 35 20

Additional 

Functionality

Advanced Video 

Processing 12 8 

CableCARD 15 15

DVR 45 36

DOCSIS 20 15

HD 25 16

Home Network 

Interface 10 8 

Multi-room 40 30

Multi-stream 

(cable / satellite) 16 8 

Multi-stream 

(Terrestrial / IP) 8 6 

Removable Media 

Player 8 8 

Removable Media 

Player / Recorder 10 10

Source: EPA.11,12

As of October 17, 2011, there are 40 ENERGY STAR qualified STB models.13 They include the 

following: 

• 10 cable STBs, including HD, HD multi-room, and HD-DVR multi-room models. 

• 10 satellite STBs, including SD, HD, HD multi-room, and HD-DVR multi-room models. 

• 19 IPTV STBs, including HD, HD-DVR, HD multi-room, and HD-DVR multi-room 

models. 

• 1 thin client STB. This is a HD model.
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3.11.2 Federal Communications Commission

The U.S. Federal Communications Commission (FCC) has attempted to separate proprietary 

security from hardware in the U.S. cable industry via the mandatory CableCARD requirement. 

CableCARD allows any cable STB to be compatible with all service providers. The initial 

implementation of CableCARD did not, however, support electronic program guide, video-ondemand or pay-per-view features. As a result, although all cable STBs must have CableCARD, 

the majority of cable service providers also utilize additional proprietary security protocols to 

enable 2-way communication functionality such as video-on-demand. 

The FCC’s recently published National Broadband Plan details another path to achieve separable 

security in a second attempt to increase competition in the U.S. market. The FCC now 

recommends an approach where the service providers can own the home’s gateway device. The 

device would require an internal TV tuner and conditional access capability and the ability to 

stream video in a standard format. This would allow third party STBs and display devices that 

are interoperable with all service providers (i.e., cable, satellite, and IPTV) to be sold through 

retail channels. The new initiative, named AllVid, is currently in the notice of inquiry stage.14 If 

the FCC decides that AllVid is viable and receives sufficient industry support, the notice of 

inquiry may become a notice of proposed rulemaking. 

3.11.3 Summary of International Programs 

Several policy initiatives related to STBs, both in development and currently in effect, exist at 

the international level (Table 3.11.2). The following subsection section focuses on the recent 

European voluntary industry agreement. 

Table 3.11.2 Select International Policy Pertaining to STBs

Jurisdiction Equipment 

Addressed

Policy Approach Advantages Disadvantages

Australia and 

New Zealand

complex 

STBs 

Maximum Platform 

Allowance (MPA) power 

level for active standby and 

on mode that is dependent 

on the type of STB

Simple and easy to 

implement

No incentive for multi-room 

or thin clients

Canada Complex 

STBs 

Minimum energy 

performance standard 

(draft).Total energy 

consumption (TEC) 

approach with base type + 

functional adders

Simple and easy to 

implement; 

harmonized with 

ENERGY STAR and 

Europe

Covers only cable and 

satellite STBs. No incentive 

for multi-room or thin clients

China simple and 

complex 

STBs 

Endorsement label Covers all modes of 

operation

Varying definitions of simple 

vs. complex STBs and 

operation modes when 

compared to U.S. and 

Europe

China simple and 

complex 

STBs 

Draft regulation (in 

process); Modal power (On 

and Standby Modes) plus 

functional adder

Would cover all 

STBs sold in China

No expected incentive for 

multi-room or thin clients
3-14

European 

Union 

Voluntary 

Agreement

complex 

STBs 

Total energy consumption 

(TEC) approach with base 

type + functional adders

Approach supported 

by EU service 

providers; can 

frequently update

Does not cover 100% of 

STBs in Europe

Japan - Top 

Runner 

Program

DVD 

recorders 

with tuners

Total energy consumption 

(TEC) approach with base 

type + functional adders

Simple and easy to 

implement

HDD capacity as metric; 

does not address auto-power 

down

South Korea -

e-Standby 

Program

simple and 

complex 

STBs 

Targets standby power 

limits for “active” and 

“passive” standby modes.

Simple and easy to 

implement

Does not regulate On mode; 

little flexibility for

manufacturers to pursue 

comprehensive energy 

efficiency across all modes

Switzerland simple and 

complex 

STBs 

Endorsement label Harmonized with 

EU’s TEC approach 

from Code of 

Conduct

Must revise functional 

adders as new features 

become available

3.11.4 European Union Voluntary Agreement on Set-Top Boxes 

European industry, together with energy efficiency stakeholders, worked to develop a voluntary 

agreement for STBs, formally the “Industry Voluntary Agreement to improve the energy 

consumption of Complex Set Top Boxes,” as an alternative to a mandatory requirement. The 

agreement was designed as a self-regulatory instrument, and came into effect July 1, 2010.15 

The European voluntary agreement employs a total energy consumption approach to evaluating 

STB energy savings, similar to ENEGRY STAR. The calculation is based on the assumption that 

a STB will be in on mode for 9 hours and in standby for 15 hours per day. For devices that 

support auto-power down, an additional allowance is made, and it is assumed that auto-power 

down will result in the device being in on mode for only 4.5 hours per day. 

The total energy allowance methodology incorporates an allowance for base functionality, plus 

allowances for specific, additional functionalities present across a duty cycle. Different STB 

types have different base allowances and additional allowances are given for DVRs, Advanced 

Video and High Definition processing, and additional tuners. Table 3.11.3 compares the total 

energy allowances for base functionality and additional functionality, for both ENERGY STAR 

and the EU voluntary agreement. 

Table 3.11.3 U.S. ENERGY STAR and EU Voluntary Agreement Total Energy 

Allowances (in kWh) 

Base Functionality ENERGY STAR 2.0 EU Voluntary 

Agreement (Tier 1)

ENERGY STAR 3.0 

(effective September 

1, 2011)

Duty Cycle 14 On, 10 Stby

- or - 

7 On, 7 APD, 10 Stby

9 On, 15 Stby

- or - 

4.5 On, 19.5 Stby 

(APD enabled)

14 On, 10 Stby

- or - 

7 On, 7 APD, 10 Stby

Cable 70 45 60

Satellite 88 45 70
3-15

IP 45 40 50

Additional Functionality

Additional Tuners / Multi-stream 53 20 16

Advanced Video Processing 18 20 12

DVR 60 20 45

High Definition 35 20 25

Multi-room 44 38 40

DOCSIS / Return Path for EU 20 60 20

Source: EPA and DIF.11,15

3.12 EXISTING TEST PROCEDURES

Released in January 2011, the most recent ENERGY STAR test procedure revision requires 

power measurements for several different types of activities. This version came into effect at the 

same time Version 3.0 program requirements did, in September 2011. The test procedure 

requirements include measurements for watching Live TV, recording Live TV to DVR, playing 

back recorded TV from DVR, recording Live TV to removable media and playing back recorded 

TV from removable media. Measurements are typically taken in three different reference 

channels: network TV, live sports, and live news. Measurements are also required for STBs that 

have a sleep mode, auto power down feature and deep sleep state, as well as multi-room and thin 

client STBs. 

Other relevant test procedures include the Canadian Standards Association’s (CSA) test 

procedure C380-0816, the Consumer Electronics Association’s (CEA) industry standards CEA201317 and CEA-202218, and the International Electrotechnical Commission’s (IEC) industry 

standard IEC-6208719. The IEC test procedure uses a simplified ENERGY STAR test procedure 

methodology, with less required activity measurements (no reference channels) and slightly 

different operating mode definitions. ENERGY STAR may potentially modify its test procedure 

approach in future versions to better harmonize with the IEC. While the ENERGY STAR and 

IEC test methods use different terminology, the CSA test procedure C380-11, currently in public 

review, explains how IEC terminology maps to ENERGY STAR terms such that IEC STB test 

measurements can be used in conjunction with the energy allowance equations documented in 

the ENERGY STAR program requirements to determine product qualification status. 
3-16

REFERENCES

 

1

 Hardy, G., and J. Swofford. 2011. Better Viewing, Lower Energy Bills, and Less Pollution: 

Improving the Efficiency of Television Set-top Boxes. Edited by N. Horowitz: Prepared by 

Ecos Consulting for the Natural Resources Defense Council.

2

 http://www.investors.com/NewsAndAnalysis/Article/566402/201103171842/CableSubscriber-Losses-Mount.htm

3

 http://www.oecd.org/document/54/0,3343,en_2649_34225_38690102_1_1_1_1,00.html 

4

 Peters, J.S., M. Frank, J. Van Clock, and A. Armstrong. 2010. Electronics and Energy 

Efficiency: A Plug Load Characterization Study. Prepared by Research Into Action, Inc. for 

Southern California Edison. 

http://www.calmac.org/publications/BCE_FINAL.pdf

5

 IMS Research. 2010. US 2010 Set-top Box Share. Custom report prepared for Lawrence 

Berkeley National Laboratory.

6

 NCTA. Top 25 Multichannel Video Programming Distributors as of June 2011. National 

Cable Telecommunications Association. 

http://www.ncta.com/Stats/TopMSOs.aspx (accessed November 4, 2011) 

7

 IMS Research. Online Set-top Box and iDTV Database. Posted August 18, 2011. (accessed 

November 4, 2011). 

8

 Charles, D. 2009. Leaping the Efficiency Gap. Science 325 (5942): 804-811. 

9

 IEA. 2009. Chapter 7: Set-Top Boxes. In Gadgets and Gigawatts: Policies for Energy 

Efficient Electronics. International Energy Agency. Paris, France: IEA Publications.

10 DirectTV Website. Will DirectTV offer a TiVo DVR? 

http://support.directv.com/app/answers/detail/a_id/77/~/directv-relationship-with-tivo---newhd-dvr (accessed November 28, 2011) 

11 EPA. 2011. ENERGY STAR Program Requirements Product Specification for Set-top Boxes: 

Version 3.0. Environmental Protection Agency. 

http://www.energystar.gov/ia/partners/prod_development/revisions/downloads/settop_boxes/

ENERGY_STAR_STB_Final_Version_3_Specification.pdf

12 EPA. 2011. ENERGY STAR Program Requirements Product Specification for Set-top Boxes: 

Version 4.0. Environmental Protection Agency. 

http://www.energystar.gov/ia/partners/prod_development/revisions/downloads/settop_boxes/

ENERGY_STAR_STB_Final_Version_4_Specification.pdf
3-17

 13 EPA. 2011. ENERGY STAR Set-top Box Qualified Product List. Posted October 17, 2011. 

Environmental Protection Agency. (accessed November 4, 2011) 

14 FCC. 2010. FCC 10-60. Notice of Inquiry. Federal Communications Commission

15 Digital Interoperability Forum. 2009. DIF Q&A: On the Industry Voluntary Agreement to 

improve the energy consumption of Complex Set Top Boxes. 

http://www.difgroup.com/uploads/DocsAndMediaManager/documents/DIF%20Q&A%20-

%20On%20the%20Industry%20Voluntary%20Agreement.pdf

16 C380-08: Test Procedure for the Measurement of Energy Consumption of Set-Top Boxes

(2008). Canadian Standards Association. 

17 CEA-2013-A: Digital Set-Top Box Background Power Consumption (2007). Consumer 

Electronics Association.

18 CEA-2022: Digital Set-Top Box Active Power Consumption Measurement (2007). Consumer 

Electronics Association.

19 IEC-62087: Methods of measurement for the power consumption of audio, video and related 

equipment. Edition 3 (2011) Section 8. International Electrotechnical Commission.
4-i

CHAPTER 4. PRELIMINARY TECHNOLOGY ASSESSMENT

TABLE OF CONTENTS

4.1 TECHNOLOGY OVERVIEW ........................................................................................ 4-1

4.2 MARKET SEGMENT INFRASTRUCTURE ................................................................ 4-1

4.2.1 Cable ................................................................................................................................ 4-1

4.2.2 Satellite ............................................................................................................................ 4-2

4.2.3 Internet Protocol Television (IPTV) ................................................................................ 4-2

4.3 COMPONENTS .............................................................................................................. 4-2

4.4 SELECT FUNCTIONALITY AND FEATURES ........................................................... 4-3

4.4.1 Digital Video Recorder (DVR) ........................................................................................ 4-4

4.4.2 High Definition (HD) ....................................................................................................... 4-4

4.4.3 Multi-room Technology ................................................................................................... 4-4

4.4.4 Middleware ...................................................................................................................... 4-4

4.4.5 Content Protection ........................................................................................................... 4-5

4.4.6 Content Availability ......................................................................................................... 4-5

4.5 ENERGY CONSUMPTION ........................................................................................... 4-5

4.5.1 National Energy Use of STBs .......................................................................................... 4-5

4.5.2 Unit Energy Consumption of STBs ................................................................................. 4-7

4.6 POTENTIAL ENERGY EFFICIENCY MEASURES .................................................. 4-10

4.6.2 Power Management ....................................................................................................... 4-12

4.6.3 Multi-Room Technology ............................................................................................... 4-13

4.7 ASSESSMENT OF FUTURE PRODUCT EVOLUTION............................................ 4-15

4.7.1 Blending Content and Device Consolidation. ................................................................ 4-15

4.7.2 Placeshifting ................................................................................................................... 4-16

4.7.3 Advanced Video Functionality ...................................................................................... 4-16

LIST OF TABLES

Table 4.5.1 U.S. Annual Residential Electricity Consumption by End Use (2011) ............... 4-6

Table 4.5.2 STB Power Use by Segment and Technology Type ............................................ 4-7

Table 4.5.3 Estimated Power Use Breakdown for Cable and Satellite Pay-TV STBs ......... 4-10

Table 4.6.1 Energy-Saving Strategies for STBs ................................................................... 4-11
4-ii

LIST OF FIGURES 

Figure 4.3.1 Example of STB Internal Components ................................................................ 4-3

Figure 4.5.1 Projected Energy Use of STBs ............................................................................ 4-6

Figure 4.5.2 STB Power Demand, Measured from 58 Pay-TV STBs ..................................... 4-8

Figure 4.5.3 Recent ENERGY-STAR-qualified STB Power Demand .................................... 4-9

Figure 4.6.1 Deep Sleep Warning from Sky Broadcasting .................................................... 4-12

Figure 4.6.2 Schematic Deep Sleep Power Consumption Profile .......................................... 4-13

Figure 4.6.3 Example Multi-Room Configuration ................................................................. 4-14
4-1

CHAPTER 4. PRELIMINARY TECHNOLOGY ASSESSMENT

4.1 TECHNOLOGY OVERVIEW

Television signals in the U.S. have evolved from analog to digital signals. Recent regulatory 

mandates have shut off analog television signals, in order for wireless broadband providers to 

use that portion of the wireless spectrum. In the U.S., satellite, cable, and telecommunication 

service providers transmit their television signals digitally. While local channels are available to 

any cable-ready TV, video-on-demand, premium channels, and electronic channel guides all 

require some type of STB to protect the content streaming into the home. 

In its simplest form, a STB is a digital transport adapter that receives television signals from a 

service provider and delivers them to a consumer display and/or recording device.1 These 

simplest STBs may include an electronic program guide and the ability to view premium 

channels, but offer no video on demand or pay per view options. More advanced STBs offer 

multiple tuners and have two-way communication with the service provider, making it possible 

to request customized content, such as video-on-demand. Advanced STBs with the ability to 

record and timeshift content are called digital video recorders (DVRs). The newest STB form 

factor is a home gateway. These devices connect to multiple thin clients, which are low powered 

STBs that can only communicate within the home. The home gateways include up to fourteen 

tuners, process the video signals for all the attached thin clients, and can act as an Internet 

modem as well. Regardless of complexity, each STB is specific to the delivery technology, be it 

cable, satellite, or IPTV.

4.2 MARKET SEGMENT INFRASTRUCTURE

The types of STBs in households generally depend on the type of service provider, given that 

each type of service provider has a different video delivery approach (i.e., infrastructure 

technology). Each of the three main infrastructure technologies (cable, satellite, and IPTV) use 

varying amounts of energy. Field study power measurements of select STBs are provided in 

section 4.5. 

4.2.1 Cable

Cable television has historically dominated the U.S. pay-TV landscape. U.S. cable service 

providers operate regionally as well as nationally, and rarely compete against one another. 

Today’s cable TV infrastructure is a hybrid between fiber optic and coaxial cable, allowing for a 

larger throughput of data than either satellite or IPTV’s systems. The service provider sends 

every available channel to the STB, where the TV tuner picks the desired channel. Additional 

services, such as frequency modulation (FM) radio programming, high-speed Internet, and 

telephone are sent through the same cable, but using different frequencies. 
4-2

4.2.2 Satellite 

Television satellites are geosynchronous, meaning they orbit in sync with the earth and stay in 

the same position above the ground at all times. This makes it possible for a satellite dish to 

transmit data without readjusting its position. Satellite service providers broadcast, or uplink, 

signals to a satellite that they either own or lease for channel space. A transponder on the satellite 

receives the uplinked signals, converts the signal, and relays it to home satellite dishes. Each 

satellite occupies a particular location in orbit, and transmits signals across frequency bands 

assigned by the Federal Communications Commission (FCC). Satellite service providers deploy 

their STBs as part of a subscription package. 

4.2.3 Internet Protocol Television (IPTV)

IPTV is the newest pay-TV market segment. The concept first gained market share in France in 

the 1990s, but it was not until 2006 that the United States had an IPTV service provider (AT&T). 

IPTV provides television via the Internet. Cable and satellite function by sending every channel 

directly to the STB in the home and allowing the user to tune in to the channel(s) they want to 

watch. With IPTV, the service provider sends only the requested channel(s) to a home gateway, 

which routes the channel(s) to the corresponding STB. This is similar to how a network router 

sends a requested website to the corresponding computer.a

 Similar to cable and satellite pay-TV, 

IPTV provides a channel guide, live broadcasting, time-shifted content (i.e., content recorded via 

a DVR), and video on demand content. IPTV service providers deploy their STBs as part of a 

subscription package. 

4.3 COMPONENTS

Similar to a computer, a STB has a variety of components, as shown below in Figure 4.3.1: 

1) Basic Components. These include typical interfaces (including an IR receiver for a 

remote control), digital displays (e.g., timer, channel display, internal power supply, and 

a primary tuner and demodulator. In the case of satellite STBs, the power supply also 

powers the low noise block-downconverter on the dish (this power consumption is not 

measured as part of any current efficiency policy).

2) Conditional Access Module. The CA module (e.g., CableCARD) is placed before the 

demultiplexer and is used for descrambling the encrypted signal, and also provides a 

smart card interface for various security features.

3) Digital Decoder (a.k.a. Demultiplexer). A digital decoder receives the signal given by 

the demodulator, and then demultiplexes & decompresses the video requested by the 

user.

4) CPU (Processor). As in a regular PC, the CPU takes care of interactions between all the 

hardware peripherals and software modules inside a STB. 

 

a While many boxes can be connected like a computer using Cat5E Ethernet wire, many AT&T installations use the 

HomePNA protocol over coax or phoneline.
4-3

5) DRAM (Dynamic Random Access Memory). DRAM is used to store volatile data for 

all software needs. 

6) Video DRAM. Video DRAM is used in a STB for storing the decoded video image that 

is being output to the television or video recorder. 

7) NVRAM (Non-Volatile Random Access Memory). NVRAM is needed for persistent 

memory needs for the STB. Generally, STB configurations are written into NVRAM to 

keep the settings persistent during power cycles and to provide a consistent user 

experience.

8) Hard Disk Drive (HDD). This component is for STBs with digital video recorder (DVR) 

functionality, used to save and store video content for later viewing. The HDD is also 

sometimes used by the service provider to store electronic program guide information. 

9) High Definition (HD) Functionality. High definition is an additional functionality not 

normally categorized as a component itself. It requires a STB that includes additional 

graphics processing, along with an HD-enabled TV and subscription to HD-content. 

10) Data Modem. This is the data tuner necessary to provide two-way data communication 

with the service provider, to allow for features such as video on demand and provide 

accurate billing for viewed programs. Two-way data communication is sometimes 

referred to as return path functionality. 

11) Second TV Tuner. Allows the STB to handle two channel feeds simultaneously, 

enabling picture-in-picture viewing or recording one show while watching another 

(recording is only available for STBs with a DVR).

Figure 4.3.1 Example of STB Internal Components

Source: Mudgal, Schischke, and Iyama (2008).2 Reprinted with permission.

4.4 SELECT FUNCTIONALITY AND FEATURES

This section reviews select functionality and features available in STBs. ENERGY STAR uses 

an approach giving a total energy consumption (in kWh) allowance to many of these 

functionalities/features, applied to a base allowance. Additional functionality not described 
4-4

below includes advanced video processing, push video, home network interface, multi-stream, 

and removable media player/recorder. The Appendix includes information regarding these 

functionalities.

4.4.1 Digital Video Recorder (DVR)

DVRs are STBs with the ability to save shows for later viewing or to pause/fast-forward live TV. 

The term DVR is often used two ways: one referencing the functionality (e.g., a STB with DVR 

functionality) and the other as the type of STB (e.g., HD-DVR). Because one tuner is required 

for each channel the user “tunes in” to, DVRs typically have multiple tuners, so the user can 

record a show while watching live TV. 

4.4.2 High Definition (HD)

Similar to the rise of DVR functionality, the capability to output high definition (HD) content has 

become a very popular functionality of STBs. For a viewer to be able to watch content in HD, 

they need: (1) an HD-enabled STB, (2) an HD-enabled TV, and (3) access to HD-content as part 

of their pay-TV subscription. ENERGY STAR defines HD as the capability to transmit or 

display video signals with resolution greater than or equal to 720p.1

 720p refers to a resolution of 

1280 x 720. 

4.4.3 Multi-room Technology 

The pay-TV industry is moving toward multi-room solutions. As an example, instead of 

deploying three DVRs in a home, one for each TV, a user would have one DVR that acts as a 

server and two thin clients. The server DVR includes all the tuners and performs all the 

transcoding, so thin clients no longer need to communicate with the service provider, only the 

server DVR within the home. This enables the consumer to schedule recordings on a central 

DVR and view these recordings and live TV from any TV in the home. “Networked STBs that 

facilitate whole-home DVR functionality are becoming more common, and pay-TV service 

providers are looking to these solutions to provide differentiation, increased customer 

satisfaction, and ultimately new revenue streams”.3

 

By definition, multi-room is the capability to provide independent audio/video content to 

multiple devices within a single-family dwelling. This definition does not include the capability 

to manage gateway services for multi-subscriber scenarios.1

4.4.4 Middleware

Middleware is software that can communicate between the service provider head-end and 

network equipment. The term head-end generally refers to a pay-TV service provider’s local 

transmission facility. Middleware is similar to an operating system in a computer, although the 

customer does not see it. The customer sees the service provider applications software, such as a 

channel guide and video on demand. Several cable operators have adopted tru2way/OCAP 
4-5

specifications as the standard for their middleware.b IPTV stakeholders, on the other hand, have 

yet to come to a clear consensus on any standardized middleware platform. DirecTV was a 

founding member of the RVU Alliance, which is a middleware solution created for DVR 

server/thin client networks, and functions with cable or satellite.

4.4.5 Content Protection

STBs typically contain some type of encryption that ensures customers only have access to the 

services that they have paid for. Conditional access is a term that refers to the encryption, 

decryption and authorization techniques employed to protect content from unauthorized 

viewing.1 Before the FCC-mandated CableCARD, each STB was proprietary to the service 

provider and included propriety conditional access protocols. In efforts to bring STBs to retail, 

the FCC mandated all service providers provide their customers with a CableCARD, which is a 

separable form of conditional access. Shortly thereafter, video-on-demand became very popular 

and could only be accessed through proprietary service provider STBs since CableCARD does 

not support video-on-demand. This development drove consumers to lease STBs from their 

service providers. 

4.4.6 Content Availability

There is a growing consumer demand to access content on a variety of consumer electronic 

devices. “Consumers expect to have multiple options for consuming content, but content owners 

fear that once content is on the network, it is vulnerable to misuse and piracy”.3 The Digital 

Living Network Alliance (DLNA) has developed interoperability guidelines which outline 

standards for device communication and content sharing among various devices within the 

home.4

4.5 ENERGY CONSUMPTION

4.5.1 National Energy Use of STBs

Residential electricity consumption in the U.S. totals over 1,300 billion kilowatt-hours (kWh) 

annually (Table 4.5.1). Consumer electronics devices are becoming more commonplace in the 

U.S., and their resulting electricity consumption is growing relative to other end uses. STBs are a 

contributor to that energy use. Previous studies have estimated total U.S. STB energy 

consumption at approximately 20 billion kWh per year and 23 billion kWh per year.5,6 Other 

work has estimated national STB energy consumption as high as 27 billion kWh per year, or 

even higher.7,8 These estimates suggest STBs consume approximately 2 percent of total 

residential electricity consumption. Most experts agree that STB energy use is project to increase 

significantly, both domestically and internationally (Figure 4.5.1). At 27 billion kWh per year, 

this results in approximately 16 million metric tons of carbon dioxide (CO2) emissions annually.9 

 

b See http://www.tru2way.com/ and http://www.cablelabs.com/opencable/ for more information.
4-6

Table 4.5.1 U.S. Annual Residential Electricity Consumption by End Use (2011) 

End-Use Quadrillion Btu Billion kWh Share of Total

Space Cooling 0.80 234 17.3%

Lighting 0.70 205 15.1% 

Water Heating 0.44 129 9.5%

Space Heating a 0.42 123 9.1%

Refrigeration 0.36 106 7.8% 

Televisions and Set-Top Boxes 0.34 100 7.3%

Clothes Dryers 0.18 53 3.9% 

Computers and Related Equipment 0.18 53 3.9%

Cooking 0.11 32 2.4%

Dishwashers b 0.09 26 2.0%

Freezers 0.08 23 1.9%

Clothes Washers b 0.03 9 0.6% 

Other — Miscellaneous Uses 0.89 261 19.2%

Total 4.63 1,357 100.0%

 a Includes fans and pumps. b Excludes energy for water heating. 

 Source: EIA (2011).

10

Figure 4.5.1 Projected Energy Use of STBs

Source: IEA (2009).8 Reprinted with permission.

The majority of STBs today currently consume nearly the same power whether or not the device 

is being actively used to watch or record television. As a result, approximately two-thirds of the 

total annual energy use of STBs (an estimated 18 billion kWh/year) occurs when a consumer is 

neither watching nor recording a show.7
4-7

4.5.2 Unit Energy Consumption of STBs

Each new generation of STBs includes faster processors, more memory, larger hard drives, and 

many other new features into a box with limited size and limited ability to remove heat with 

cooling fans. The need to maintain a power limit in the face of significant feature advances has 

resulted in tremendous efficiency gains over the last decade. Although efficiency has improved, 

STB count per home is also increasing, resulting in increased total household energy 

consumption. Service providers have made only limited gains in reducing STB energy 

consumption when subscribers are neither watching nor recording video (though active energy 

use has indeed decreased). 

A recent study measured the energy consumption of 58 pay-TV STBs deployed in the U.S. over 

the past two years, along with a small number of pay-TV STBs in Europe.7 A few emerging OTT 

STBs like AppleTV were also measured. The key conclusions were: 

• U.S. STBs continue to use almost as much power when not in use as when active. 

However, leading European service providers have begun to solve this problem in their 

newest STBs. 

• Satellite HD-DVRs in this study drew slightly more power than their cable counterparts 

(Table 4.5.2). This trend may, however, change over time. IPTV, which is rapidly gaining 

market share compared to cable and satellite, enables the use of lower-power STBs. The 

most efficient U.S. HD-DVRs tested were IPTV boxes, drawing approximately 18 watts 

when active, 15 watts less than the average cable or satellite HD-DVR. European IPTV 

HD-DVRs demonstrated on mode power levels of less than 10 watts. 

• Pay-TV STB unit energy consumption has held steady in the last few years as the 

increased energy consumption of advanced features has offset component-level 

efficiency gains.

• Consumers are increasingly getting their video content from a variety of new broadband 

video streaming services, including Netflix, Hulu, AppleTV, and the just-introduced 

GoogleTV. Consumers can access these services via Internet-enabled TVs, video game 

consoles, Blu-ray players, or dedicated OTT STBs. The data included two of these OTT 

devices. The most efficient device in the study was an OTT STB, which drew just 3 watts 

in on mode and under 1 watt in sleep mode.

• Many consumers currently use these streaming devices in addition to their pay-TV STB. 

This streaming capability is likely to be integrated into future-generation TVs. These TVs 

will be able to stream video from sources such as Netflix, Hulu, and locally stored 

content on the home’s DVR. The study did not expect these low-power streaming devices 

to replace the central DVR in the near future. 

Table 4.5.2 STB Power Use by Segment and Technology Type 

Average On-Mode 

Power (W)

Average Sleep-Mode 

Power (W) Units Measured

Cable

SD 15 15 13

HD 21 20 11

SD-DVR 26 25 2 
4-8

HD-DVR 32 31 13

Satellite 

SD 12 9 1 

HD 18 17 2 

SD-DVR 30 29 1 

HD-DVR 40 38 11

IPTV 

SD-DVR 10 10 2 

HD-DVR 18 15 2 

OTT

STB 5 4 2 

 Source: Hardy and Swofford (2011).7 

Figure 4.5.2 STB Power Demand, Measured from 58 Pay-TV 

STBs

 Source: Modified from analysis used in Hardy and Swofford (2011).

7 Reprinted with permission.

Figure 4.5.2 shows the on mode and sleep mode power levels measured for all the devices in the 

study. On mode measurements are represented by dots, whereas sleep mode measurements are 

represented by bars. The measurements are grouped by broad STB functionality, and color-coded 

by base type (cable, satellite, IPTV, OTT). The major trends observed include: (a) a general 

increase in power with increased functionality (in particular HD and DVR); (b) a general 
4-9

increase in power for satellite STBs; (c) low power for IPTV and OTT STBs; and (d) very little 

difference between on mode and sleep mode power for the majority of STBs.

It is important to note, however, that the STBs measured in the study are up to two years old, and 

may not fully represent current models. These measurements are, however, higher than from 

similar studies in 2006 and 2007.8 Figure 4.5.3 shows a similar figure for ENERGY STARqualified STBs, as of Oct. 17, 2011. As these are qualified models, they exhibit the best 

efficiency for STBs in their class. On average, these models are consuming significantly less 

power than the average models in Figure 4.5.2, especially for HD-DVR models.

Figure 4.5.3 Recent ENERGY-STAR-qualified STB Power 

Demand

Source:EPA (2011).11

Table 4.5.3 lists the estimated power use of various STB components. These estimates, however, 

are a few years old, and may not fully represent modern functionality. Included in these power 

use estimates is the power required for the return path (communication with the service 

provider). Several current technologies can be used for the return path, including: 

• Plain Old Telephone System (POTS) – uses low speed dial-up modem to communicate 

infrequently with the service provider. Energy consumption is negligible. 

HD HD-DVR Multiroom

HD Multiroom

SD HD-DVR

On Mode Power

Sleep Mode Power

Cable

Satellite

IPTV

Thin-Client
4-10

• Ethernet – keeps network presence active at all times, even in standby. Ethernet has low 

power consumption (~1W). 

• ADSL – keeps network presence active at all times, even in standby. ADSL has higher 

power consumption (few watts up to 10 watts depending on type and speed). ADSL 

specification allows for low power states, although often they are not used by 

manufacturers or telecommunication companies. Current European best practice is 

ADSL2 (2nd generation ADSL), which uses 2.6W - 3W. VDSL2 (2nd Generation 

VDSL) uses 3.5 – 6W. 

• DOCSIS - keeps network presence active at all times, even in standby. DOCSIS has 

higher power consumption than ADSL. Current installations average from 5W up to 12W 

depending on type and speed of connection. DOCSIS currently does not have low power 

modes, although in DOCSIS 3 it should be possible to reduce the number of 

communication channels from 4up/8down to 1/1, but no service provider has done this 

commercially as yet. The best practice DOCSIS 3 would use 6.2 - 7.1W. 

Table 4.5.3 Estimated Power Use Breakdown for Cable and Satellite Pay-TV STBs

Functionality (F) or Component (C) On Mode Power 

Use (watts)

% of Energy 

Consumption for 

HD Receiver

% of Energy 

Consumption for 

HD-DVR STB 

Basic Components (C) 10 30% 24%

Data Modem (C) 10 30% 24%

High Definition (F) 8 25% 20%

Hard Disk Drive (C) 8 N/A 20%

Second TV Tuner (C) 5 15% 12%

Total 100% 100%

Source: Mudgal, Schischke, and Iyama (2008).2

4.6 POTENTIAL ENERGY EFFICIENCY MEASURES 

Service providers and manufacturers continue to improve on mode STB efficiency, by improving 

power supply efficiency and utilizing efficient components. Although the industry has made 

progress, the increased energy consumption of advanced features has offset component-level 

efficiency gains. Recent estimates suggest efficient pay-TV STBs and service provider networks 

could reduce the energy use of the installed base of STBs by 30 to 50 percent by 2020.7

Efficient networks are an important part of the solution, but there are significant barriers to 

improving them. If a cable user disconnects their STB from the network by powering it off, the 

head-end reports a service fault and an engineer can be called. Similarly, on satellite systems, 

software updates and subscription information may degrade over time, and the user may find 

they have no longer have a subscription when they turn the box on again. The cost to change the 

network infrastructure is potentially very large, and requires a long planning horizon. Changes to 

the STB are likely relatively low cost and easier to achieve than those to the existing network 

infrastructure.
4-11

The primary energy savings opportunities identified by recent studies7,8,12 (Table 4.6.1) include: 

• Enabling STBs to automatically power down to much lower power levels when not in use 

(e.g., in the middle of the night, while users are at work). 

• Shifting to whole-home solutions that include a main STB connected to the primary TV 

and either TVs specially-designed to access the video content stored on the main box or 

low-power thin client STBs that serve the same function.

These two opportunities are explained in detail below. Although other areas for energy efficiency 

improvement are worth mentioning (e.g., efficient power supplies, efficient components), power 

management and multi-room technology offer the most comprehensive means for maximizing 

energy savings without hindering the consumer experience. 

Table 4.6.1 Energy-Saving Strategies for STBs

Measure 

Number

Measure Name Explanation Relative 

Savings 

Opportunity

Difficulty

1 Power 

management Switch off components when not actually 

required, including hard disk, image processing 

chips, and multiple tuners

High Moderate

2 Utilize multiroom technology Shifting to whole-home solutions that include a 

main box connected to the primary TV with 

either TVs specially-designed to access the 

video content stored on the main box or lowpower thin client STBs that serve the same 

function

High Low

3 More efficient 

components

Install switch-mode power supply and more 

efficient chips for image conversion

Moderate Moderate

4 Reduce disk 

energy use

Install more efficient disk designs, switch to 

flash memory, or store content at a remote 

server

Moderate Moderate

5 Lower clock 

speeds on chips Reduce processing speed to minimum speed 

for type of image transmitted

Low Low

6 Consolidate 

boxes Some homes use two or more boxes to provide 

signals to several televisions

High Moderate

7 Relax security 

requirements Service provider currently restricts ability of box 

to enter low power modes to guard against 

hackers and to protect content

Moderate High

8 Allow user to set 

functionality Through a control panel, the user could modify 

settings to more precisely match his needs, 

possibly resulting in even greater energy 

savings

Low Moderate

Note: Some measures overlap (e.g., measure 2 helps to achieve measure 6 in theory). Table has been modified to 

include multi-room technology.

Source: IEA (2007),

12 Table 37: Energy-saving strategies for set-top boxes. p. 147. Based on presentations at the 

"Workshop on Energy-Efficient Set-Top Boxes and Digital Networks" at the IEA, Paris, France, 4-6 July 2007.
4-12

4.6.2 Power Management

Modern STBs draw nearly as much power when they are off or in sleep mode as they do when in 

use. There are “concerns about the energy use of today’s STBs because the power needed by the 

STB when the user is watching/recording programming and the power needed by the STB when 

the user has physically hit the off button are virtually the same”.13 STB components, such as hard 

drives and tuners, could be powered down when not in use without significantly impacting the 

user experience.6 This would considerably lower the power draw of STBs when they are not in 

use (i.e., watching or recording a show). Best in class power management schemes include both 

light and deep sleep states. 

In the U.S., no pay-TV service provider has initiated a significant power management scheme to 

date. “Unfortunately, incorporating a sleep mode in STBs is more difficult to implement because 

a sleep mode solution would need to be developed and specified by service providers and agreed 

upon by hardware manufacturers, software developers, and communication protocol experts”.13

There exist some reasons as to why such power management schemes have yet to be enabled in 

the U.S. Reasons include security, long boot-up times, updates to electronic program guides, and 

the need for the STB to continuously stay connected to the network, among others. On the other 

hand, select service providers in Europe have already begun implementing power management 

schemes despite the above-mentioned issues. 

European satellite service provider Sky Broadcasting offers an example of energy efficient STB

hardware. They offer a HD-DVR that draws 23 watts in on mode and 13 watts in a light sleep 

state.7

 Light sleep is a state in which there is no video output, no recording functions, but 

network connections are maintained. The STB enters light sleep when the user presses the power 

button on the remote. In addition, the STB enters a 1 watt deep sleep state between 11pm and 

4am (unless the consumer is actively using the device), after which it enters a light sleep state. 

This deep sleep feature may be disabled by the consumer, and a warning appears if the TV is on 

but there has been a long period of inactivity (see Figure 4.6.1). The STB requires 90 seconds to 

wake up from a deep sleep, and wakes up almost instantly from a light sleep. During deep sleep, 

the STB periodically and briefly wakes up every 30 minutes to check for updates and for new 

program recording requests, before returning to deep sleep. Figure 4.6.2 illustrates this sleep 

behavior schematically. Anecdotal reports suggest that Sky Broadcasting has received almost no 

negative feedback, that consumers are mostly happy with (or unaware of) the changes to the STB

operating behavior and that there is a low incidence of consumers disabling the auto-powerdown feature. 

Figure 4.6.1 Deep Sleep Warning from Sky Broadcasting

Source: Mudgal, Schischke, and Iyama (2008).2 Reprinted with permission.
4-13

Figure 4.6.2 Schematic Deep Sleep Power Consumption Profile

Source: Mudgal, Schischke, and Iyama (2008).2 Reprinted with permission.

Chinese manufacturer Skyworth produces another example of an efficient STB. Their cable

STBs consume only 8 W by employing low power components and an efficient power supply. 

The standby power is only 1 W, and the technologies needed to achieve this low standby power 

add only US$ 1 to the cost of each box. In addition, the wake-up time from this standby level is 

only 15 seconds.8

4.6.3 Multi-Room Technology 

Multi-room technology enables consumers to schedule recordings once on a central DVR and to 

view these recordings and live TV from any TV in the home. Multi-room STBs with DVRs 

provide additional consumer utility since consumers can access programs saved on their main 

STB hard drive from any connect TV in the house, and switch rooms while watching the same 

show. This is a premium feature that is sought after by consumers and is rapidly gaining 

popularity. 
4-14

Multi-room technology is new to the market, but it has the opportunity to limit national STB

energy by eliminating the need for multiple fully functional and energy consumptive STBs in 

one home. Instead of multiple, fully-functional STBs, a home could be outfitted with a central 

STB with multiple tuners, and several low-power thin-client STBs with minimal functionality 

(Figure 4.6.3). Multi-room is only applicable to households with more than one STB. 

True thin-client STBs do not require all of the components and functionality (and associated 

energy use) of a primary STB in the home. Implementing thin clients can significantly reduce 

household energy use. A central and fully functional DVR STB would communicate to the 

service provider and contain the conditional access and network connectivity necessary to 

provide pay-TV content to the home. This box would then serve other client boxes in the home 

connected to other TVs around the house. These client boxes would not need select functionality 

and components such as conditional access or DVRs, as they only need to be able to 

communicate to the central box to obtain content as needed. Thin clients can draw as little as 8 

W.7

 

Figure 4.6.3 Example Multi-Room Configuration

 

Source: Hardy and Swofford (2011).7 Reprinted with permission.

Some multi-room solutions currently deployed do not use true thin clients. Instead, the service 

provider uses fully functional STBs in the client role. Although this limits the number of DVRs 

in the home, it is not an optimal solution, and is potentially only saving energy at the household 

level for 4-5 STBs/house or more. Replacing the auxiliary boxes with true thin clients eliminates 

this problem. 
4-15

Another strategy for reducing energy consumption involves TVs themselves serving as clients, 

which can obtain the content they need from the single and central DVR STB in a home. This 

would eliminate the need for thin client STBs altogether and would reduce household energy use 

by consolidating devices. TVs are already trending toward Internet capability, with growing 

feature sets and functionality. The reduction in household energy from eliminating the need for 

multiple STBs may potentially offset any power premium that these additional features in the TV 

would entail. 

The RVU Alliance is a consortium of consumer electronics groups working to accelerate the 

availability of service provider content throughout the connected home.14 RVU’s goal is to use 

its Remote User Interface (RUI) technology for home networked television entertainment, 

ensuring interoperability among devices implementing RVU’s RUI technology, and educating 

the market about RVU technology. As innovation takes place in the market, service providers are 

encouraged to shift to multi-room solutions that only require one main STB and much lower 

power thin client STBs for the other TVs in the home. 

The main gateway STB, however, may use significantly more energy than a normal STB. A 

multi-room solution might therefore not save much energy per house if there are only 2 or 

perhaps 3 STBs in a house. There is rapid innovation in multi-room technology, and multi-room 

STB power consumption is changing quickly. There is currently insufficient data to precisely 

determine how many STBs per home are required before a multi-room setup would save energy, 

4.7 ASSESSMENT OF FUTURE PRODUCT EVOLUTION 

The pay-TV STB has evolved past its originally intended role. Initially limited to acting as a 

gateway for rendering pay-TV content to viewers, STBs are now technically capable of serving 

as a media center for the entire home. Technical innovation continues to take place at a rapid 

pace in both the pay-TV market and consumer electronics in general. Both have a significant 

impact on the STB. New opportunities already being implemented in some of today’s STBs

include blending broadcast and Internet content, remotely accessing content, other placeshifting 

features, targeted advertising, social networking applications, and additional storage.15 This 

section provides a brief overview of the importance of blending content, placeshifting, and other 

advanced video features, and their impact on the evolution of the STB. 

4.7.1 Blending Content and Device Consolidation.

The convergence of pay-TV, Internet video, and user-stored content will have a large impact on 

the role of the STB over the next decade. For example, currently, Google TV’s software enables 

users to search and watch broadcast video content, browse the Internet, and organize media 

stored on a DVR, all while sitting in front of a TV rather than a computer. Google TV software is 

also currently available on two hardware devices: the Logitech Revue (a dedicated STB) and 

Sony’s Internet TV with Google TV. The future of TV will likely be a mixture of technology and 

delivery methods, though service providers will remain influential stakeholders in the pay-TV 

arena.16 
4-16

Additionally, STBs and network equipment are likely to become consolidated, with a single 

gateway device providing television and Internet access to the home. EPA already includes 

“home network interface” in its list of additional functionalities for the ENERGY STAR STB 

program.1 Given that many users obtain Internet and television service from the same service 

provider, and that both services can be delivered via the same medium (e.g., cable), it is very 

natural for STBs and modem/routers to become integrated. 

4.7.2 Placeshifting

The term placeshifting refers to technology that allows the user to watch video content on 

multiple devices, and ultimately multiple locations. Whereas timeshifting simply refers to the use 

of a DVR to be able to watch content whenever you want, placeshifting makes content available 

to the screen in front of the user, be it a TV, laptop, tablet, or cell phone. Any screen with an 

Internet connection would be able to view broadcast TV, saved DVR content, or Internet videos. 

This type of viewing flexibility is becoming increasingly popular with consumers. 

The ultimate goal of placeshifting is to make video content, paid and free, available on all types 

of consumer electronics devices. One challenge of making pay-TV subscriptions available across 

multiple devices is ensuring adequate content protection, making sure the content is only viewed 

by those who pay for it. Video content owners are aware of past issues related to peer-to-peer file 

sharing, particularly with respect to music content. 

Important issues regarding the development of these cross-platform initiatives include:3

• How content providers, service operators and their consumer electronics partners agree 

on industry-wide digital rights management schemes; 

• The development of authentication solutions that account for the consumer as both a 

subscriber to premium pay-TV services and a user of online services; 

• The role of consumer electronics such as home computers and residential gateways to 

transcode media and apply appropriate management rules on content; and 

• Consumer demand for paying a premium on cross-platform content services.

4.7.3 Advanced Video Functionality

In the next few years, STBs will begin to offer advanced video functionality, including full 

1080p high definition video, high efficiency video coding (HEVC) which saves on bandwidth, 3-

D signals, and ultra high definition video. 
4-17

REFERENCES

 

1

 EPA. 2011. ENERGY STAR Program Requirements Product Specification for Set-top Boxes: 

Version 3.0. Environmental Protection Agency. 

http://www.energystar.gov/ia/partners/prod_development/revisions/downloads/settop_boxes/

ENERGY_STAR_STB_Final_Version_3_Specification.pdf

2

 Mudgal, S., K. Schischke, and S. Iyama. 2008. Preparatory study on complex set-top boxes 

(EuP Lot 18), Final Report. DG Transport and Energy, European Commission. 

3

 Scherf, K. 2010. The Necessity of Content Flexibility in the Connected Home. Parks 

Associates.

4

 Parks Associates. 2009. The Future of Networked Devices and Digital Content. Parks 

Associates.

5

 Roth, K., and K. McKenney. 2007. Residential consumer electronics electricity consumption 

in the United States. European Council for an Energy Efficiency Economy (ECEEE) 

Summer Study, June 4-9, at La Colle sur Loup, France. 

6

 May-Ostendorp, P. 2007. Tuning in to Energy Efficiency: Prospects for Energy Savings in 

TV Set-Top Boxes. edited by N. Horowitz: Prepared by Ecos Consulting for Natural 

Resources Defense Council.

7

 Hardy, G., and J. Swofford. 2011. Better Viewing, Lower Energy Bills, and Less Pollution: 

Improving the Efficiency of Television Set-top Boxes. edited by N. Horowitz: Prepared by 

Ecos Consulting for the Natural Resources Defense Council.

8

 IEA. 2009. Chapter 7: Set-Top Boxes. In Gadgets and Gigawatts: Policies for Energy 

Efficient Electronics. Paris, France: IEA Publications.

9

 Based on 0.6 metric tons of CO2 per MWh. 

EIA. 2008. 2008 Summary Statistics (United States). Table 1. U.S. Energy Information 

Administration. 

http://www.eia.doe.gov/cneaf/electricity/st_profiles/us.html

10 EIA. 2011. Annual Energy Outlook 2011. Energy Information Administration. 

http://www.eia.gov/forecasts/aeo/

 

11 EPA. 2011. ENERGY STAR Set-top Box Qualified Product List. Posted October 17, 2011. 

Environmental Protection Agency. (accessed November 4, 2011) 

12 IEA. 2007. Set-Top Boxes: Energy Use Affected by the Principal-Agent Problem in the 

United States. In Mind the Gap: Quantifying Principal-Agent Problems in Energy Efficiency. 

Paris, France: IEA Publications.
4-18

 13 Porter, S. 2005. Cable and Satellite Set Top Box Energy Savings Opportunities, edited by N. 

Horowitz: Prepared by Ecos Consulting for the Natural Resources Defense Council. 

http://www.nrdc.org/air/energy/energyeff/stb.pdf

14 http://www.rvualliance.org/

15 Parks Associates. 2009. Digital Lifestyles and the Service Provider. Parks Associates.

16 Drawbaugh, B. 2011. Could this be the year we get to ditch the cable box? engadget.

http://www.engadget.com/2011/01/09/could-this-be-the-year-we-get-to-ditch-the-cable-box/
1

APPENDIX: DEFINITIONS

VARIOUS GENERAL DEFINITIONS 

A set-top box is an electronic device that receives a video signal and converts it for display on a 

television or, increasingly, on a computer monitor.1

A set-top box is the generic name for a device used to convert an incoming TV broadcast signal 

to one that can be seen on a screen, and it therefore sometimes referred to as an integrated 

receiver decoder.2

A set-top box is a cable, satellite, Internet Protocol or other device whose primary function is to 

receive television signals from a specific source and deliver them to a consumer display and or 

recording device, such as a television or DVR.3

A set-top box is a device that connects to a television and some external source of signal, and 

turns the signal into content then displayed on a screen.4

A set-top box is any dedicated equipment that receives, processes and stores data from digital 

broadcasting streams and related services, and provides output audio and video signals.5

BASE TYPE3 

Cable. A set-top box whose primary function is to receive television signals from a broadband, 

hybrid fiber/coaxial, or community cable distribution system with conditional access (CA) and 

deliver them to a consumer display, thin-client/remote set-top box, and/or recording device. 

Satellite. A set-top box whose primary function is to receive television signals from satellites 

and deliver them to a consumer display, thin-client/remote set-top box, and/or recording device. 

Cable Digital Transport Adapter (DTA). A minimally-configured set-top box whose primary 

function is to receive television signals from a broadband, hybrid fiber/coaxial, or community 

cable distribution system and deliver them to a consumer display and/or recording device. 

Internet Protocol (IP). A set-top box whose primary function is to receive television/video 

signals encapsulated in IP packets and deliver them to a consumer display, thin-client/remote settop box, and/or recording device. 

Terrestrial. A Sset-top box whose primary function is to receive television signals over the air 

(OTA) or via community cable distribution system without conditional access (CCA) and deliver 

them to a consumer display, thin-client/remote set-top boxB, and/or recording device. 

Thin-client / Remote. A set-top boxB that (1) is designed to interface between a Multi-room settop box and a TV (or other output device), (2) has no ability to directly interface with a Service 

Provider, and (33) relies solely on a multi-room set-top box for content. Any set-top box that 

meets the definition of a cable, satellite, IP, or terrestrial STTB is not a thin-client/remote set-top 

box. 
2

PRODUCT FEATURES/COMPONENTS3

Base Functionality. The primary functionality that defines the ENERGY STAR criteria 

applicable to a particular set-top box. Base Functionality is one of the following: Cable, Satellite, 

IP, Terrestrial or Thin-Client/Remote. 

Advanced Video Processing. The capability to encode, decode, and/or transcode audio/video 

signals in accordance with standards H.264/MPE G 4 or SMPTTE 421M. 

CableCARD. The capability to decrypt premium audio/video content and services and provide 

other network control functions via a plug-in conditional access module that complies with the 

ANSI/SCTTE 28 HOST-PPOD Interface Standard.

a

Digital Video Recorder (DVR). The capability to store video in a digital format to a rewritable 

disk drive or other non-volatile storage device integrated into a set-top box. This definition 

excludes video capture software for personal computers or server-based DVR capabilities. 

Data Over Cable Service Interface Specification (DOCSIS®). The capability to distribute data 

and audio/video content over cable television infrastructure in accordance with the CableLabs®

Data Over Cable Service Interface Specification.

b

European Data Over Cable Service Interface Specification (EuroDOCSIS). An international 

suite of standards that define interface requirements for cable modems involved in high-speed 

data and video/audio content distribution over cable television systems. 

High Definition (HD) Resolution. The capability to transmit or display video signals with 

resolution greater than or equal to 720p. 

Home Network Interface. The capability to interface with external devices over a high 

bandwidth network (e.g., IEEE 802.11 (WiFi), MoCA, HPNA). For purposes of this 

specification, IEEE 802.3 wired Ethernet is not considered a Home Network Interface. 

Multi-room. The capability to provide independent audio/video content to multiple devices 

within a single-family dwelling. This definition does not include the capability to manage 

gateway services for multi-subscriber scenarios. 

Multi-stream. The capability to deliver two or more simultaneous audio/video streams to a 

consumer display, thin-client/remote set-top box, or recording device. The simultaneous streams 

may be delivered via a physically separate input or via the primary input. This definition does 

not include out-of-band tuners. 

Removable Media Player. The capability to decode digitized audio/video signals on DVD or 

Blu-ray Disc optical media. 

 

a http://www.scte.org/standards/

b http://www.cablelabs.com/specifications/
3

Removable Media Player / Recorder. The capability to decode and record digitized 

audio/video signals on DVD or Blu-ray Disc optical media. 

OPERATIONAL MODES3

On Mode. Where the product is connected to a mains power source, has been activated and may 

be providing one or more primary functions. The common terms “active”, “in-use” and “normal 

operation” also describe this mode. 

Sleep Mode. Where the product is connected to a mains power source, is not providing a 

primary function, and offers one or more of the following user oriented or protective functions 

which may persist for an indefinite time: 

1) To facilitate the activation of other modes (including activation or deactivation of On 

mode) by remote switch (including remote control), internal sensor, timer; 

2) Continuous function: information or status displays including clocks; 

3) Continuous function: sensor-based functions. 

Deep Sleep State. A power state within Sleep Mode characterized by reduced power 

consumption and increased time required to return to full On Mode functionality. 

OTHER DEFINITIONS3

Automatic Power Down (APD). The capability of a device to switch itself from On mode to 

Sleep mode after a predetermined period of time (APD timing) has elapsed. APD timing begins 

when the following criteria have been met: 

1) The device has ceased performance of all primary functions; or 

2) The last user input has been received (e.g., remote control signal, volume adjustment). 

Primary Function. 

1) Delivery of live or recorded audio/video content to a thin-client/remote set-top box or 

local/remote recording device is considered a primary function; 

2) Delivery of live or recorded audio/video content to a consumer display within four hours 

of last user interaction/input is considered a primary function; 

3) Continuous device functions (e.g., clocks, status displays, indicator lamps) are NOT 

considered primary functions. 

Service Provider. A business entity that provides audio/video content to subscribers with whom 

it has an ongoing contractual relationship. A Service Provider distributes ENERGY STAR 

qualified set-top boxes to end users under a lease or rental arrangement. 

Conditional Access. The encryption, decryption, and authorization techniques employed to 

protect content from unauthorized viewing. CableCARD and Downloadable Conditional Access 

System (DCAS) are examples of conditional access technology. 

Digital Television Adapter (DTA). A device that receives terrestrial (over the air) digital 

signals and converts them to an analog output suitable for analog TVs. DTAs do not provide 
4

digital signal output. This definition does not include converters for satellite or cable digital 

signals or devices that perform multiple functions (e.g., DVD players with DTA capability). 

Game Console. A stand-alone device whose primary function is to process video game content. 

The primary inputs for game consoles are special hand-held controllers rather than the mouse 

and keyboard used by a conventional computer. Game consoles are equipped with audio/video 

outputs for use with televisions as the primary display, rather than an external monitor or 

integrated display. Game consoles typically do not use a conventional general-purpose operating 

system, but often perform a variety of multimedia functions such as: DVD/CD playback, digital 

picture viewing, and digital music playback. 

Out-of-band Tuner. A tuner compliant with standards ANSI/SCTE 55-1 2002, ANSI/SCTE 55-

2 2002, or similar, that is used to gain access to data channels outside of the primary audio/video 

source signal. These tuners may facilitate two-way communication to allow a set-top box to 

exchange data (e.g., diagnostics) with the Service Provider, and may enable access to Pay-PerView or other rich-media interactive content. 

Typical Energy Consumption (TEC). A means for evaluating energy efficiency through a 

calculation of expected energy consumption for a typical user over a one year period, expressed 

in units of kWh/year. 

Unit Under Test (UUT). The device being tested. 

Product Family. A group of product models that are: (1) made by the same manufacturer, (2) 

subject to the same ENERGY STAR qualification criteria, and (3) of a common basic design. 

Product models within a family differ from each other according to one or more characteristics 

or features that either: (1) have no impact on product performance with regard to ENERGY 

STAR qualification criteria, or (2) are specified herein as acceptable variations within a product 

family. For Set-top Boxes, acceptable variations within a product family include aesthetic 

housing changes that do not affect the thermal characteristics of the device (e.g., color, labeling, 

or other cosmetic modifications). 
5

REFERENCES

 

1

 IEA. 2007. Set-Top Boxes: Energy Use Affected by the Principal-Agent Problem in the 

United States. In Mind the Gap: Quantifying Principal-Agent Problems in Energy Efficiency. 

Paris, France: IEA Publications.

2

 IEA. 2009. Chapter 7: Set-Top Boxes. In Gadgets and Gigawatts: Policies for Energy 

Efficient Electronics. Paris, France: IEA Publications.

3

 EPA. 2011. ENERGY STAR Program Requirements Product Specification for Set-top Boxes: 

Version 3.0. Environmental Protection Agency. 

http://www.energystar.gov/ia/partners/prod_development/revisions/downloads/settop_boxes/

ENERGY_STAR_STB_Final_Version_3_Specification.pdf

4

 Mudgal, S., K. Schischke, and S. Iyama. 2008. Preparatory study on complex set-top boxes 

(EuP Lot 18), Final Report. DG Transport and Energy, European Commission. 

5

 European Commission. 2009. Code of Conduct on Energy Efficiency of Digital TV Service 

Systems Version 8. Institute for Environment and Sustainability, Renewable Energy Unit. 

http://re.jrc.ec.europa.eu/energyefficiency/pdf/CoC_Digital_TV-version%208_2009.pdf